Playing the expectations game: When are investment-backed land use expectations (Un)reasonable in state courts?

Urban Lawyer

Volumn 38, Issue 1, 2006, Pages 81-110

  Breemer, J David ^a,b,c  

^a Pacific Legal Foundation   (United States)

^b UNIVERSITY OF HAWAII   (United States)

^c UNIVERSITY OF CALIFORNIA   (United States)

Author keywords

[No Author keywords available]

Indexed keywords

LAND USE CONFLICT; STANDARD (REGULATION); URBAN POLICY;

EID: 33646134138     PISSN: 00420905     EISSN: None     Source Type: Journal    
DOI: None     Document Type: Review

References (277)

1. U.S. 104 (1978).
2. "[N]or shall private property be taken for public use, without just compensation." U.S. Const. amend. V.
3. Penn Central, 438 U.S. at 124 (citation omitted).
4. See Lingle v. Chevron USA, 125 S. Ct. 2074, 2082 (2005) ("The Penn Central factors... have served as the principal guidelines for resolving regulatory takings claims that do not fall within the physical takings or Lucas rules.");
5. Palazzolo v. Rhode Island, 533 U.S. 606, 633 (2001) (O'Connor, J., concurring) ("Our polestar instead remains the principles set forth in Penn Central itself...").
6. See, e.g., Penn Central, 438 U.S. at 124;
7. see also Philip Morris, Inc. v. Reilly, 312 F.3d 24, 48-50 (1st Cir. 2002) (en banc) (Selya, J., concurring) (reading Supreme Court precedent to establish investment-backed expectations as a dispositive takings consideration);
8. Consumers Union of U.S., Inc. v. New York, 840 N.E.2d 68 (N.Y. 2005) ("The primary, but not exclusive Penn Central inquiry turns on "the extent to which the regulation has interfered with distinct investment-backed expectations");
9. Mayhew v. Town of Sunnyvale, 964 S.W.2d 922, 937 (Tex. 1998) ("The reasonable investment-backed expectation of the claimant is critical to this [partial takings] analysis....");
10. La Salle Nat'l Bank v. City of Highland Park, 799 N.E.2d 781, 797 (Ill. App. Ct. 2004) ("plaintiffs' reasonable investment-backed expectations are an especially important consideration in the takings analysis").
11. See, e.g., R. S. Radford & J. David Breemer, Great Expectations: Will Palazzolo v. Rhode Island Clarify the Murky Doctrine of Investment-Backed Expectations in Regulatory Takings Law?, 9 N.Y.U. Envtl. L.J. 449, 449 (2001) [hereinafter Great Expectations] ("Although more than two decades have elapsed since Penn Central, neither courts nor commentators have been able to agree on the meaning or applicability of investment-backed expectations in takings law.");
12. Gideon Kanner, Hunting the Snark Not the Quark: Has the U.S. Supreme Court Been Competent in Its Efforts to Formulate Coherent Regulatory Takings Law?, 30 Urb. Law. 307, 337-38 (1998) ("even though the Court has used [the expression 'distinct investment-backed expectations'] a dozen times, no one really knows what it.... means");
13. Lynda J. Oswald, Cornering the Quark: Investment-Backed Expectations and Economically Viable Uses in Takings Analysis, 70 Wash. L. Rev. 91, 107 (1995) ("[T]he meaning of the phrase remains uncertain, rendering its effectiveness as a legal doctrine questionable at best.");
14. Andrea L. Peterson, The Takings Clause: In Search of Underlying Principles Part I - A Critique of Current Takings Clause Doctrine, 77 Ca. L. Rev. 1301, 1324 (1989) ("It is not at all clear... what role 'interference with reasonable expectations' plays in the Court's takings analysis.").
15. See, e.g., Ruckelshaus v. Monsanto, 467 U.S. 986, 1005 (1984) (lack of reasonable investment-backed expectations defeated takings claim);
16. E. Enter. v. Apfel, 524 U.S. 498, 532-35 (1998) (plurality upholds plaintiff's takings claim largely on investment-backed expectations grounds);
17. Landgraf v. USI Film Prod., 511 U.S. 244, 265 (1994) ("settled expectations should not be lightly disrupted").
18. See Ala. Dep't of Transp. v. Land Energy, Ltd., 886 So. 2d 787, 799 (Ala. 2004) ("The specific terminology 'distinct investment-backed expectations' originates in Penn Central, but is not defined in that opinion or any subsequent decision of the United States Supreme Court relating to regulatory takings."); Philip Morris, 312 F.3d at 36 ("Despite the importance of reasonable investment-backed expectations, under the Penn Central framework courts have struggled to adequately define this term."); see also sources cited supra note 6.
19. Philip Morris, 312 F.3d at 36 ("Despite the importance of reasonable investment-backed expectations, under the Penn Central framework courts have struggled to adequately define this term.");
20. see also sources cited supra note 6
21. See sources cited supra note 6. Cat lovers may prefer R.S. Radford's comment that identifying reasonable expectations is like "trying to put a collar on a Cheshire cat."
22. See supra note 6 and accompanying text. See generally J. David Breemer & R.S. Radford, The (Less?) Murky Doctrine of Investment-Backed Expectations After Palazzolo, and the Lower Courts' Disturbing Insistence on Wallowing in the Pre-Palazzolo Muck, 34 Sw. U. L. Rev. 351 (2005) [hereinafter The (Less?) Murky Doctrine of Investment-Backed Expectations].
23. 125 S. Ct. 2491 (2005).
24. Id. at 2506.
25. For an in-depth look at the Penn Central litigation, see Gideon Kanner, Making Laws and Sausages: A Quarter-Century Retrospective on Penn Central Transportation Co. v. City of New York, 13 Wm. & Mary Bill Rts. J. 653 (2005).
26. Penn Central, 438 U.S. at 115-22.
27. See id. at 130-31 ("In deciding whether a particular governmental action has effected a taking, this Court focuses... on the nature and extent of the interference with rights in the parcel as a whole-here, the city tax block designated as the 'landmark site.'").
28. Id. at 136-37.
29. Penn Central had entered into a multi-million-dollar lease contract based on the projected construction of the office building, prepared two separate sets of architectural plans to effect the project, and demonstrated that the railroad terminal had originally been designed to be surmounted by a twenty-story office tower. See id. at 116.
30. Id. at 137.
31. See Penn Cent., 438 U.S. at 137, n.34.
32. See id. at 137.
33. Unlike the TDRs at issue in a later Supreme Court case, Suitum v. Tahoe Regional Planning Agency, 520 U.S. 725 (1997), those available in Penn Central were not a mere sham to avoid compensating property owners.
34. See R.S. Radford, A Last Word on 1998 Recent Development: Takings and Transferable Development Rights in the Supreme Court: The Constitutional Status of TDRs in the Aftermath of Suitum, 28 Stetson L. Rev. 685, 690 (1999) (stating that in Penn Central, "the development the City would not permit on one site could simply be shifted to another of the plaintiffs' properties in the same part of Manhattan. The TDRs had direct utility to the Terminal's owners, offering them other development opportunities in exchange for those that had been denied.").
35. Penn Cent., 438 U.S. at 136.
36. Id.
37. See Land Energy, Ltd., 886 So. 2d at 799;
38. Eller Media Co. v. City of Houston, 101 S.W.3d 668, 681-82 (Tex. Ct. App. 2003) ("The Court in Penn Central considered the theme of the law at issue - reasonable return on investment - in reaching the conclusion that the regulation in that case was not a taking." (Emphasis added.))
39. Penn Central, 438 U.S. at 124 (emphasis added).
40. See Robert M. Washburn, Reasonable Investment-Backed Expectations as a Factor in Defining Property Interest, 49 Wash. U.J. Urb. & Contemp. L. 63, 71 (1996) (stating "[t]he Supreme Court's adoption of the investment-backed expectation factor... emphasiz[ed] the rights of property owners... suggesting that courts apply this new factor to strengthen the position of the property owner against governmental regulation.").
41. 444 U.S. 164 (1979).
42. 467 U.S. 986 (1984).
43. 483 U.S. 825 (1987).
44. Kaiser Aetna, 444 U.S. at 164.
45. See Hodel v. Irving, 481 U.S. 704, 716 (1987) (citing Kaiser Aetna for proposition that the right to exclude others is "one of the most essential sticks in the bundle of rights that are commonly characterized as property").
46. See generally David L. Callies & J. David Breemer, The Right to Exclude Others from Private Property: A Fundamental Constitutional Right, 3 Wash. U.J.L. & Pol'y 41-43 (2000).
47. 444 U.S. at 175 (emphasis added).
48. Id. (emphasis added).
49. See Presbytery of Seattle v. King County, 787 P.2d 907, 915 n.29 (1990) (suggesting that "distinct" means the "expectation must have some concrete manifestation," while "reasonable" suggests that the expectation "must be appropriate under the circumstances");
50. Calvert G. Chipchase, From Grand Central to the Sierras: What Do We Do with Investment-Backed Expectations in Partial Regulatory Takings?, 23 Va. Envtl. L.J. 43, 57 (2004).
51. Ruckelshaus v. Monsanto Co., 467 U.S. 986, 1024 (1984).
52. 467 U.S. at 998-99.
53. Id. at 1005.
54. Id. at 1005-06
55. (quoting Webb's Fabulous Pharmacies, Inc. v. Beckwith 449 U.S. 155, 161)
56. Id.
57. Monsanto, 467 U.S. at 1006 (emphasis added).
58. Id. at 1008.
59. The court explained: [i]n an industry that long has been the focus of great public concern and significant government regulation, the possibility was substantial that the Federal Government, which had thus far taken no position on disclosure of health, safety, and environmental data concerning pesticides, upon focusing on the issue, would find disclosure to be in the public interest. Id.
60. Id. at 1005.
61. See Philip Morris, 312 F.3d at 38 (reviewing Monsanto and concluding that "notice negated any reasonable investment-backed expectations" during one period relevant to Monsanto's takings claim);
62. Daniel R. Mandelker, Investment-Backed Expectations in Takings Law, 27 Urb. Law. 215, 219 (1995) ("Monsanto suggests actual notice is not necessary because it held the statute put the company on notice it might have to disclose trade secrets. This is constructive notice.") [hereinafter Mandelker, Investment-Backed Expectations].
63. See Connolly v. Pension Benefit Guar. Corp., 475 U.S. 211, 227 (1986);
64. Bowen v. Gilliard, 483 U.S. 587, 608 (1987).
65. Nollan v. Cal. Coastal Comm'n, 483 U.S. 825 (1987).
66. Id. at 827-28.
67. Id. at 828.
68. Id. at 858.
69. Id.
70. Nollan, 483 U.S. at 833 n.2.
71. Id.
72. See Mandelker, Investment-Backed Expectations, supra note 42, at 222.
73. Palazzolo v. Rhode Island, 533 U.S. 606 (R.I. 2001).
74. See infra notes Part II and accompanying text.
75. Palazzolo, 533 U.S. at 632-36.
76. Palazzolo v. Rhode Island, 746 A.2d 707, 710 (R.I. 2000).
77. Palazzolo, 533 U.S. at 614.
78. Id.
79. Id.
80. Id.
81. Id. at 614-15.
82. Palazzolo, 533 U.S. at 615-16.
83. See Palazzolo, 746 A.2d at 717.
84. Id. at 715-17.
85. Id. at 716-17.
86. Id. at 715.
87. Although Justice Stevens agreed that Palazzolo's claim was ripe for adjudication and joined in that part of the majority opinion, he dissented from the judgment and, "in particular," from the majority's rejection of the notice rule. See Palazzolo, 533 U.S. at 638 (Stevens, J., concurring in part and dissenting in part).
88. Id. at 626-30.
89. Id. at 626.
90. Id.
91. Id. at 627.
92. Palazzolo, 533 U.S. at 627-28.
93. Id. at 627.
94. Id. at 630 (O'Connor, J., concurring).
95. See Stansbury v. Jones, 812 A.2d 312, 334 n.15 (Md. 2002) (citing Palazzolo for proposition that "the new owner could have asserted any rights the prior owner could have asserted"). See generally Breemer & Radford, The (Less?) Murky Doctrine of Investment-Backed Expectations, supra note 10, at 381-87.
96. Palazzolo, 533 U.S. at 637-38 (Scalia, J., concurring).
97. Id. at 632-33 (O'Connor, J., concurring).
98. O'Connor specifically agreed with the majority that "the Rhode Island Supreme Court erred in effectively adopting the sweeping rule that the preacquisition enactment of the use restriction ipso facto defeats any takings claim based on that use restriction." Id. at 632.
99. Id. at 633-34 (O'Connor, J., concurring).
100. Justice O'Connor's opinion sought to address the "more difficult question [of]... what role the temporal relationship between regulatory enactment and title acquisition plays in a proper Penn Central analysis." Id. at 632.
101. She concluded "[t]oday's holding does not mean that the timing of the regulation's enactment relative to the acquisition of title is immaterial to the Penn Central analysis." Id. at 633.
102. Id. at 635-36 (O'Connor, J., concurring).
103. Palazzolo, 533 U.S. at 634 (O'Connor, J., concurring) (emphasis added).
104. Id. at 635 (O'Connor, J., concurring).
105. Id. at 636 (O'Connor, J., concurring).
106. Id. at 634 (O'Connor, J., concurring).
107. Id. at 634 (O'Connor, J., concurring)
108. (quoting Pennsylvania Coal Co. v. Mahon, 260 U.S. 393, 415 (1922)).
109. See Palazzolo, 533 U.S. at 655 (Breyer, J., dissenting) (endorsing Justice O'Connor's inclusion of regulatory notice as an investment-backed expectations factor in partial takings cases).
110. U.S. 302 (2002).
111. See id. at 321, 322, 327 n.23, 335-36.
112. See generally Steven J. Eagle, The Regulatory Takings Notice Rule, 24 U. Haw. L. Rev. 533, 574-75 (2002) (noting that the regulatory note rule "appears destined to play an important (albeit undetermined) role in adjudicating partial takings regulatory takings claims").
113. In indicating that the regulatory notice rule and expectations analysis as a whole applied only to partial takings claims, the opinions of Justice O'Connor and the dissenting Palazzolo Justices were consistent with the Court's 1992 decision in Lucas v. South Carolina Coastal Council, 505 U.S. 1003 (1992).
114. In Lucas v. South Carolina Coastal Council, the Supreme Court held that a regulation which denies an owner all economically beneficial use of land constitutes a per se or categorical taking without regard for the landowner's investment-backed expectations. Lucas, 505 U.S. at 1019.
115. In a concurring opinion, Justice Kennedy took issue with the strictness of the Lucas majority's categorical "denial of all economically beneficial use" rule. Id. at 1032-36 (Kennedy, J., concurring).
116. He argued that the investment-backed expectations standard should apply even in cases of complete deprivation of beneficial use. Id. at 1034.
117. Kennedy further proposed that the reasonableness of a landowner's expectations should be judged not just by common law principles, but by the "whole of our legal tradition." Id. at 1035.
118. In Justice Kennedy's view, important state laws might justify the elimination of all productive use of private land under the reasonable investment-backed expectations inquiry. Id. at 1036.
119. But the majority opinion rejected Justice Kennedy's push to apply the "investment-backed expectations" test to the facts of Lucas. The Court recognized that the expectations inquiry might be pertinent to the per se "deprivation of all economically beneficial use" only if it helps to establish whether a total taking is at issue in the first place. Id. at 1016 n.7.
120. However, the majority made clear that once it is established that there has been a denial of all use, the expectations factor has no further place in that analysis. Id. at 1027, 1019 n.8.
121. See Palazzolo, 533 U.S. at 634 (O'Connor, J., concurring) (investment-backed expectations are not "talismanic").
122. Id. at 634.
123. See Mayhew v. Town of Sunnyvale, 964 S.W.2d 922, 936 (Tex. 1998) ("Knowledge of existing zoning is to be considered in determining whether the regulation interferes with investment-backed expectations");
124. Sherrill v. Town of Wrightsville Beach, 344 S.E.2d 357, 376 (N.C. Ct. App. 1986) ("Both plaintiffs acquired their property after the single-family restriction was in place. Neither is losing any 'investment-backed expectations' by not being allowed to construct a duplex.");
125. Wetlands Bd. v. Marshall, 500 A.2d 685, 690 (N.H. 1985) (knowledge of restrictions at time of purchase defeats investment-backed expectations).
126. See, e.g., City of Virginia Beach v. Bell, 498 S.E.2d 414 (Va. 1998);
127. Gazza v. Dep't of Envtl. Conservation, 679 N.E.2d 1035 (N.Y. 1997);
128. Hunziker v. State, 519 N.W.2d 367 (Iowa 1994).
129. See Gazza, 679 N.E.2d at 1039.
130. In Palazzolo, the majority opinion rejected the notion that regulations operate as a background principle exception to total takings liability simply because they predate the claimant's acquisition of property. See Palazzolo, 533 U.S. at 629-30.
131. See generally, David L. Callies & J. David Breemer, Selected Legal and Policy Trends in Takings Law: Background Principles, Custom and Public Trust "Exceptions" and the (Mis)Use of Investment-Backed Expectations, 36 Val. U. L. Rev. 339, 362-65 (2002).
132. See, e.g., Glenn v. City of Grant City, 69 S.W.3d 126, 130-31 (Mo. Ct. App. 2002) (stating that a "factual inquiry into the specific facts of the case is necessary" only in partial takings cases);
133. Machipongo Land & Coal Co. v. Commonwealth, 799 A.2d 751 (Pa. 2002) (reviewing Palazzolo and concluding that reasonable expectations analysis arises exclusively in the partial takings context).
134. See, e.g., La Salle, 799 N.E. 2d at 797 (The Emmermans' expectations were rendered unreasonable because they "had full knowledge of the... [large lot restriction] [and] use regulation when they purchased the property more than 30 years ago.");
135. Sanderson v. Town of Candia, 787 A.2d 167, 169 (N.H. 2001) ("The plaintiff purchased the property knowing both of the ordinance's frontage requirements and that the property lacked the required frontage. Thus, she purchased the hardship of which she now complains. Under these circumstances, the plaintiff had 'few, if any, legitimate investment-backed expectations of development rights which rise to the level of constitutionally protected property rights,' and applying the ordinance to her land did not constitute a taking.");
136. Town of Georgetown v. Sewell, 786 N.E.2d 1132, 1141 (Ind. Ct. App. 2003) (landowner had no reasonable expectation of being able to build a single-family home because he was "charged with knowledge of relevant statutory provisions affecting the control or disposition" of the home site);
137. Nieveen v. County of Saunders, No. A-01-833, 2003 WL 21211965, at *6 (Neb. Ct. App. May 27, 2003) (claimant had no reasonable expectations because she "was aware of the impending regulatory changes").
138. See, e.g., Sanderson, 787 A.2d at 171;
139. La Salle, 799 N.E. 2d at 789, 797.
140. No. 244455, 2005 WL 1753805 (Mich. Ct. App. July 26, 2005) [hereinafter K & K III].
141. Id. at *3.
142. Id.
143. Id.
144. Id. at *4.
145. & K III, 2005 WL 1753805 at *4.
146. Id.
147. Id.
148. Id.
149. See K & K Constr., Inc. v. Dep't of Natural Res., 551 N.W.2d 413 (Mich. Ct. App. 1996) [hereinafter K & K I].
150. See K & K Constr., Inc. v. Dep't of Natural Res., 575 N.W.2d 531 (Mich. 1998) [hereinafter K & K II].
151. Id. at 539-40.
152. Id. at 539.
153. Id. at 540.
154. See K & K III at *6.
155. Id. at *10.
156. Id.
157. Id. at *7.
158. Id. at *9.
159. & K III at *12.
160. Id.
161. Id. at *14.
162. Id. at *13 (emphasis added).
163. Id.
164. Id.
165. & K III at *13.
166. Id.
167. See supra note 95 and accompanying text.
168. See, e.g., Friedenburg v. Dep't of Envtl. Conservation, 767 N.Y.S.2d 451 (N.Y. App. Div. 2003).
169. See Richard Roeser Prof'l Builder, Inc. v. Anne Arundel County, 793 A.2d 545, 561 (Md. 2002) (reviewing Palazzolo and concluding that "[i]n Maryland, when title is transferred, it... takes with it all the benefits and rights inherent in ownership.... [I]f the prior owner has not self-created a hardship, a self-created hardship is not immaculately conceived merely because the new owner obtains title.");
170. State ex rel. Shemo v. City of Mayfield Heights, 765 N.E.2d 345, 352-53 (Ohio 2002);
171. Moroney v. Mayor of Old Tappan, 633 A.2d 1045, 1048 (N.J. Super. Ct. App. Div. 1993);
172. N. Pugliese, Inc. v. Palmer Township Zoning Hearing Bd., 592 A.2d 118, 121 (Pa. Commw. Ct. 1991);
173. Guy v. Brandon Township, 450 N.W.2d 279 (Mich. Ct. App. 1989).
174. A.2d 287 (N.H. 1984).
175. Id. at 292.
176. Id. at 288.
177. Id.
178. Id.
179. Id. at 290-91.
180. Claridge, 485 A.2d at 291.
181. Id. at 292.
182. S.E.2d 628 (S.C. 2000).
183. Id. at 629.
184. Id. at 630.
185. Id.
186. Id. at 630-31.
187. Id. at 633.
188. McQueen, 530 S.E.2d at 634-35.
189. Id. at 635.
190. See Palm Beach Isles Assoc. v. United States, 231 F.3d 1354, 1357 (Fed. Cir. 2000), modifying 208 F.3d 1374 (Fed. Cir. 2000) ("Questions of whether the owner had reasonable investment-backed expectations at the time the property was first acquired are simply not part of the analysis" in a Lucas per se takings claim); Breemer & Radford, The (Less?) Murky Doctrine of Investment-backed Expectations, supra note 10, at 387; 403-05 (discussing Palazzolo's implicit rejection of investment-backed expectations in categorical takings analysis and the state courts' post-Palazzolo pattern of limiting expectations analysis to partial takings claims).
191. W.R. Grace & Co. v. Cambridge City Council, 779 N.E.2d 141, 155 (Mass. App. Ct. 2002);
192. see also Zanghi v. Bd. of Appeals, 807 N.E.2d 221, 226 (Mass. App. Ct. 2004).
193. N.E.2d 865 (Mass. 2005).
194. N.E.2d 1154, 1161 (Mass. Ct. App. 2004).
195. Gove, 831 N.E.2d at 875.
196. Id.
197. See id.
198. (citing Palazzolo, 533 U.S. at 635-36) (O'Connor, J., concurring).
199. See Palazzolo, 533 U.S. at 634-35 (O'Connor, J., concurring).
200. U.S. 302 (2002).
201. See Kanner, supra note 6, at 338 (1998);
202. Daniel R. Mandelker, Investment-Backed Expectations: Is There a Taking?, 31 Wash U.J. Urb. & Contemp. L. 3 (1987).
203. S.W.3d 735 (Tex. Ct. App. 2002).
204. Id. at 736.
205. Id.
206. Id. at 737.
207. Hallco applied for the permit in 1992; the county passed an ordinance prohibiting its desired land use activity a year later. Id.
208. Id.
209. Hallco, 94 S.W.3d at 738.
210. Id.
211. Id.
212. Id.
213. (citing Mayhew, 964 S.W.2d at 936).
214. Penn Cent., 438 U.S. at 136 (emphasis added).
215. Id. at 107.
216. See, e.g., Palazzolo, 533 U.S. at 634 (noting that courts consider whether a person has legitimate expectations in "development" by considering "the nature and extent of permitted development... vis-à-vis the development sought by the claimant") (emphasis added).
217. See Kasparek v. Johnson County Bd. of Health, 288 N.W.2d 511, 518 (Iowa 1980) (holding that landowners had reasonable expectations where their primary expectation for raw land was developing consistent with residential zoning).
218. See 900 G. St. Assocs. v. Dep't of Hous. & Commercial Dev., 430 A.2d 1387, 1390 (D.C. 1981);
219. Nash v. City of Santa Monica, 688 P.2d 894, 907 (Cal. 1984);
220. Holmes v. Planning Bd. of New Castle, 78 A.D.2d 1, 29 (N.Y. App. Div. 1980) (noting that a land use decision would frustrate investment-backed expectations if it prevented use of an existing office building and restaurant).
221. See generally Mayhew, 964 S.W.2d at 936 ("existing and permitted uses of property constitute the 'primary expectation' of landowner that is affected by regulation").
222. See, e.g., Woodland Manor, III Assoc. v. Reisma, No. C.A. PC89-2477, 2003 WL 1224248, at *14 (R.I. Super. Ct. Feb. 24, 2003) ("[t]he defendant knew that this was a multiphase, multimillion dollar project and that plaintiff would rely on the defendant's [favorable] findings to determine the extent and feasibility of its project");
223. see also District Intown Props. L.P. v. District of Columbia, 198 F.3d 874, 886-87 (D.C. Cir. 1999) (Williams, J., concurring) (stating that it is strange for a court to conclude that a property owner could have no reasonable expectation of development in circumstances where a subdivision was legally approved and building permits had been approved before being reconsidered and withdrawn. If the permitting authorities believed the property could be developed at the time the request was submitted, then the property owner likewise had a reasonable basis to hold the same belief);
224. Laguna Gatuna, Inc. v. United States, 50 Fed. Cl. 336, 347 (2001) (owner reasonably expected to use leasehold and right-of-way over federal land for salt water disposal where landowner had all necessary permits and Environmental Protection Agency indicated that it foresaw no barrier to such a project).
225. S.W.3d 660 (Tex. 2004).
226. Id. at 664.
227. Id.
228. Id.
229. Id.
230. Id.
231. Sheffield, 140 S.W.3d at 664.
232. Id.
233. Id. at 665.
234. Id.
235. Id.
236. Id.
237. Sheffield, 140 S.W.3d at 665.
238. Id. at 666.
239. Id.
240. Id. at 677.
241. Id.
242. Id. at 678 (emphasis added).
243. See generally supra note 167 and sources cited therein.
244. U.S. at 167, 179.
245. Id. at 179.
246. Id.
247. See generally David L. Callies & J. David Breemer, The Right to Exclude Others From Private Property: A Fundamental Constitutional Right, 3 Wash. U. J.L. & Pol'y 39 (2000).
248. No. 024083, 2004 WL 3152350 (Mass. Super. Ct. Dec. 30, 2004). In the interest of full disclosure, the author notes that he will be representing the plaintiff in the Giovanella case on appeal. The Massachusetts Supreme Court recently agreed to review Giovanella's claims.
249. Id. at *1.
250. Id.
251. Id.
252. Id.
253. Giovanella, 2006 WL 3152350 at *2.
254. Id. at *3-4.
255. Id. at *5.
256. Id.
257. Michael Berger, Happy Birthday, Constitution: The Supreme Court Establishes New Ground Rules for Land-Use Planning, 20 Urb. Law. 735, 766 (1988) (citing cases).
258. Cooley v. United States, 324 F.3d 1297, 1306 (Fed. Cir. 2003) (emphasizing, when remanding case for investment-backed expectations analysis, that the landowner purchased the property for a "mixed-use commercial project" and during four subsequent years in which this project was blocked, "an explosion of commercial activity occurred in the target area").
259. Arnell v. Salt Lake County Bd. of Adjustment, 112 P.3d 1214, 1225 n.14 (Utah Ct. App. 2005).
260. See Terminal Plaza Corp. v. City and County of San Francisco, 177 Cal. App. 3d 892, 912 (Cal. Ct. App. 1986) ("There has been no showing by Terminal that its investment-backed expectations have been compromised by the ordinance. Terminal has failed to offer any evidence that it is not receiving a reasonable rate of return on its investment...");
261. Gardner v. N.J. Pinelands Comm'n, 593 A.2d 251, 259 (N.J. 1991) (regulatory taking more likely if it does not allow an "adequate" or "just and reasonable" return on investment).
262. See, e.g., Cheyenne Airport Bd. v. Rogers, 707 P.2d 717, 730 (Wyo. 1985) (plaintiffs did not show "that full use of air rights is so bound up with the investment-backed expectations... that governmental deprivation of these rights" causes a taking); see also Berger, supra note 200 (collecting cases).
263. Palazzolo, 533 U.S. at 635 (O'Connor, J., concurring).
264. Id. at 636 (O'Connor, J., concurring).
265. See Sheffield, 140 S.W.3d at 672 (stressing that "the three Penn Central factors [are not] the only ones relevant" to takings analysis and that the court will "'consider all the surrounding circumstances' in applying 'a fact sensitive test of reasonableness'").
266. See supra notes 188-90 and accompanying text. Several recent takings decisions show that the concept of a reasonable return is still pertinent to investment-backed expectations. See e.g., In re Condemnation, 870 A.2d 400, 406 (Pa. 2005) (applying reasonable return analysis as part of inquiry into investment-backed expectations); see also Land Energy, Ltd., 886 So. 2d at 799. Indeed, a relatively recent Maryland appellate decision cited Penn Central in noting that "the phrase [reasonable return] has all but disappeared from the vocabulary of zoning, except to the extent the term 'reasonable investment-backed expectations' has crept into 'takings jurisprudence'...." Friends of the Ridge v. Baltimore Gas & Elec. Co., 724 A.2d 34, 37 n.6 (Md. 1999) (emphasis added).
267. Palazzolo, 533 U.S. at 634 (O'Conner, J., concurring).
268. See Lucas, 505 U.S. at 1031 (explaining that the "fact that a particular use has long been engaged in by similarly situated owners ordinarily imports a lack of any common-law prohibition" on building. "So also does the fact that other landowners, similarly situated, are permitted to continue the use denied to the claimant").
269. For a recent example of the "what you see is what you get" expectations rule, see Arnell, 112 P.2d at 1224 n.14;
270. cf. Action Apartment Ass'n v. Santa Monica Rent Control Bd., 114 Cal. Rptr. 2d 412 (Cal. Ct. App. 2001) (holding that landlords had a reasonable expectation that they would have to pay interest on security deposits at the going bank rate).
271. See, e.g., La Salle, 799 N.E.2d at 796-97 (takings claim arising from city's attempt to keep one of last vacant lots in an established residential subdivision in a natural state for a "public purpose");
272. see also id. at 802-03 (O'Malley, J., dissenting).
273. See, e.g., Friedenburg, 767 N.Y.S.2d at 451.
274. Steven J. Eagle, Regulatory Takings §§ 7-13(b) (3d ed. 2005) ("it is not clear that 'investment backed expectations'... has any intrinsic meaning at all").
275. Palazzolo, 533 U.S. at 633, 635 (O'Connor, J., concurring).
276. Id. at 636 (O'Connor, J., concurring);
277. Tahoe-Sierra, 535 U.S. at 321.