Be Careful What You Wish For . . .

A tip of our hat to Robert Thomas, our colleague who runs the blog and who informs us in his post of today that, the premier Supreme Court watcher, has put the petition for certiorari in Redevelopment Authority v. R. & J. Holding Co., No. 11-1234, on its watch list  (petition of the day of June 7, 2012) — which means that the SCOTUSblog folks believe it has a more than an average chance of being taken up by the court for review on the merits. Maybe. Then again, maybe not. Even if that were to happen, it would only open the door to an adverse holding, as we know from personal experience.

We were involved in two inverse condemnation cases in which the Supreme Court granted petitions for certiorari, but then when time came to a ruling on the merits, ruled against the petitioners in both of them. One was City of Monterey v. Del Monte Dunes, which turned out to be something of a big deal for property owners claiming a taking, when it held that under 42 U.S.C. Sec. 1983, property owners are entited to a trial by jury on the factual issues underlying the question of liability. The other one was Tahoe-Sierra Preservation Council, where the court held that a moratorium is not a taking when it is challenegd as a per se taking, though it may be such when it is presented and tried as an as-applied taking.

Why is R. & J. Holding a candidate for a similarly disappointing result for the petitioner? Though R & J comes from the 3rd Circuit, what is at issue in that case are the ramifications of the 9th Circuit’s San Remo Hotel v. San Francisco case on which the redevelopment agency relies, and in which the Supreme Court granted certiorari on the owner’s petition, but held that inasmuch as the California state courts had tried and adjudicated the owner’s federal taking claim, it followed under the doctrine of “full faith and credit” that the federal courts were required to accept the state courts’ no-liability holding. In the R & J case, the 3rd Circuit gave effect to the owner’s reservation of federal rights which were not adjudicated in the Pennsylvania state courts, and held that they could be pursued in federal courts. Of course, the owners’ problem in San Remo was that although they purported to reserve their federal issue for decision by federal courts while they were trying their case in state court, they nonetheless submitted it for decision there, so — held the Supreme Court — they were bound by the resulting decision.

But all that, and the Supreme Court’s holding does not change the fact that in its application of the Williamson County case, San Remo was a weird case. Don’t take our word in harshly assessing the San Remo Hotel mess. Four Supreme Court Justices joined in a separate concurring opinion expressing the view that Williamson County was so bizarre — our word, not theirs, but applicable anyway — that it should be reconsidered by the Court. So why didn’t they do that? Because the owners did not challenge the soundness of Williamson County in their San Remo submission. Maybe they should have, as Justice O’Connor who was then still on the court observed, but they didn’t, so Williamson County went unchallenged.

Now, if the Supreme Court grants the Redevelopment Agency’s petition, it will have before it a much better record (from the owner’s point of view) than did San Remo, and — who knows? — perhaps the battle of Williamson County will be re-fought with more rational results. As numerous commentators have noted, the present state of pertinent law has earned for itself a torrent of scholarly and judicial invective. See Michael M. Berger and Gideon Kanner, Shell Game:  You Can’t Get There From Here.  Supreme Court Ripeness Jurisprudence in Takings Cases at Long Last Reaches the Self-Parody Stage, 36 The Urban Lawyer 671 (2004) — see particularly pages 702-704, and note that much of this harsh language comes, not from property-minded advocates, but from commentators who take the government’s side in takings cases.

Anyway, that’s the situation as we see it. While we know and admire the work of counsel for the Redevelopment Agency, it seems to us that he is playing a dangerous game. Wouldn’t it be poetic justice if the Supreme Court took this case and straightened out the Williamson County/San Remo Hotel mess — and a mess it is — and removed the stigma from American property owners who as of now are de facto deemed to be legal pariahs — the only species of litigants known to us, who are forbidden to litigate their federal constitutional claims in federal courts. Surely the Court can do better than that.

Follow up. During the weekend we have had a chance to read the Respondents’ Brief in Opposition [to the Petition for Certiorari] and it seems clear to us that the Redevelopment Agency hasn’t a leg to stand on. Overlooked in its briefing is the fact that what the Agency did was to try and take by eminent domain a piece of property, but the Pennsylvania courts held that it lacked the power to do so, But it took it anyway (while litigation was pending) and had to give it back. But what it didn’t do is to pay just compensation to the owners for the temporary, five-year taking that was in place while the matter was being litigated. When the owners sued in state court, as they were supposed to do under the Williamson County case, the state courts denied relief on the grounds that state law permitted no such recovery. But the taking was incontestable (it was five-year, de jure taking) , so this was a clear-cut case of violation of the Just Compensation Clause of the federal Constitution, because Williamson County was crystal-clear that the sue-in-state-court-first procedural rigmarole applies only when there is a clear remedy under state law. When there isn’t, the federal courts are open to grant relief. In fact, that was the case in the Del Monte Dunes case in which SCOTUS upheld damages awarded by a federal district court. Why federal? Because at that time California courts refused to grant compensatiory relief, so it was perfectly proper for the aggrieved owners to seek it in the federal courts. Which is precisely the situation in R & J case. So what’s the fuss all about?

So what the Agency and its amici are trying to do is to distract the court by waving the old, tattered bloody shirt about how expensive it will be for them (and others like them) to have to pay damages to people who were damaged by their attempted illegal action. That’s BS. SCOTUS has held long ago that it is no defense to charges of constitutional violations that it is cheaper to deny relief than to afford it. [We are still on the road, but will have the citation for you in a day or two]. Moreover, at least here in la-la land, it is reversible misconduct of counsel to argue to a trial court that an award should be kept down because of the assertedly impecunious nature of the liable party (Hoffman v. Brandt). The entitlement to compensatory relief depends on the facts and the law, not the financial condition of the bad guys being called to task. We see no reason why the rule shoud be anyy different when a similarly morally icky argument is made to an appellate court.

But don’t take our word for anything. The owners’Brief in Opposition is available on line. Read it! Click here.

Second Follow up. We were right to conclude that the Agency did not have a leg to stand on. SCOTUS denied certiorari in this case today, June 18, 2012.