505 U.S. 1003 (1992)
In 1986, petitioner David H. Lucas purchased two residential lots on the Isle of Palms in Charleston County, South Carolina, for $975,000.1 He intended to construct single-family homes on the parcels, which at the time were zoned for such use and required no building permit for development.2 No portion of the lots qualified as a critical area under then-existing coastal zone legislation.3
Subsequently, in 1988, the South Carolina Legislature enacted the Beachfront Management Act.4 The legislation established a baseline and prohibited construction of occupable improvements seaward of a line drawn 20 feet landward of that baseline, directly affecting Lucas's parcels by barring any permanent habitable structures.5
Lucas filed an action in the Court of Common Pleas alleging that the Act's restrictions effected a taking of his property without just compensation.6 Following a bench trial, the court determined that the prohibition rendered the lots valueless and ordered the state to pay just compensation in the amount of $1,232,387.50.7
The Supreme Court of South Carolina reversed the trial court's judgment.8 It accepted the legislature's findings that new construction threatened public resources and concluded that a regulation designed to prevent serious public harm could not constitute a taking.9
The United States Supreme Court granted certiorari to review the South Carolina Supreme Court's decision.10
Whether a state regulation that denies a landowner all economically beneficial use of his property effects a taking under the Fifth Amendment?11
Regulations that deny the owner of land all economically beneficial or productive use of his property constitute a categorical taking for which compensation is required under the Fifth Amendment.12 This rule applies unless the prohibited use interests were not part of the owner's title to begin with.13
Yes. In 1986 David H. Lucas purchased two residential lots on the Isle of Palms for $975,000 intending to build single-family homes on parcels then zoned for that use with no permit required and no critical-area designation.14 The 1988 Beachfront Management Act thereafter barred all permanent habitable structures on those lots by fixing a baseline and prohibiting construction seaward of a line twenty feet landward of it.15
The trial court expressly found that this prohibition rendered the parcels valueless and awarded $1,232,387.50 in compensation.16 Because the Act effected a total deprivation of economic use, the categorical rule applies and requires compensation unless background principles of state law already prohibited the intended construction.17
The Beachfront Management Act effects a taking requiring just compensation unless the state establishes on remand that background principles would have barred the proposed use.18
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Justice Kennedy agreed that the South Carolina Supreme Court applied the wrong standard.19 He cautioned that the categorical rule should not become a per se rule in every case.20 He emphasized that reasonable investment-backed expectations must be measured against the whole of state law, including statutes and regulations in force when title was acquired.21
The common-law nuisance doctrine is not the sole source of background principles that can defeat a claim.22 On remand the state court should consider all relevant background principles rather than limiting itself to traditional nuisance abatement.23
Whether the state's police power to prevent serious public harm excuses the requirement of compensation when a regulation renders property valueless?24
No. The South Carolina Supreme Court relied on legislative findings that new construction threatened the beach/dune system and therefore constituted a valid exercise of the police power to prevent serious public harm.27 The trial court, however, found that the same Act rendered Lucas's two lots valueless.28 Because the distinction between preventing harm and conferring benefits is in the eye of the beholder and cannot justify a total economic deprivation, the police-power rationale does not excuse the compensation requirement.29
The state's police power to prevent serious public harm does not excuse the constitutional obligation to compensate when a regulation denies all economically beneficial use of property.30
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Justice Blackmun dissented on the ground that the Beachfront Management Act was a legitimate exercise of the police power to protect life and property from erosion and storms.31 He argued that the trial court's finding of valuelessness was implausible because Lucas retained rights to exclude others, to picnic, and to sell the land.32 Centuries of precedent permitted states to prohibit harmful uses without compensation.33
In his view the majority's new categorical rule departed from established doctrine and would encourage litigation whenever regulation affected property values.34
Whether background principles of state property and nuisance law determine if a total deprivation of economic use requires compensation?35
A regulation that denies all economically beneficial use requires compensation unless the proscribed use interests were not part of the owner's title to begin with.36 This means the regulation does no more than duplicate the result that could have been achieved under background principles of the state's law of property and nuisance.37
Yes. The trial court found that the Beachfront Management Act rendered Lucas's lots valueless by prohibiting the single-family homes he intended to build.38 On remand the South Carolina Supreme Court must determine whether any background principles of state property or nuisance law would have prohibited those uses at the time Lucas acquired title.39 If the intended construction was never permissible under those principles, no compensation is due.40 If it was permissible, the total deprivation effects a taking.41
Background principles of state property and nuisance law determine whether a total deprivation of economic use requires compensation under the Takings Clause.42
Related opinions on this issue
Justice Stevens joined Justice Blackmun's dissent.43 He noted that Lucas purchased the property after the State had begun studying coastal erosion problems.44 His reasonable, investment-backed expectations should be limited by the State's legitimate interest in protecting the coastline.45
The finding that the lots were rendered "valueless" is overstated; the property retains significant value for various uses.46 The judgment of the South Carolina Supreme Court should be affirmed.47