When property changes hands, the pre-existing right of the seller to
bring an inverse condemnati... more When property changes hands, the pre-existing right of the seller to bring an inverse condemnation claim against the government does not always pass to a subsequent owner. Sometimes it does. If valid takings claims expire on sale, the government may experience a windfall. But if a buyer gets a deal on burdened property and then sues under a prior owner’s takings claim, the new property owner gets a windfall. Established Supreme Court rules draw distinctions between the character of various “takings” to determine whether a claim survives a transfer of ownership. But the character of these distinctions is blurred (along with the rights of landowners) in Washington, Louisiana, and other states that continue to follow the “subsequent purchaser rule,” which is inconsistent with the U.S. Supreme Court’s ruling in Palazzolo v. Rhode Island. In those states, the determination of who gets the windfall may depend on the narrow distinction of whether a subsequent purchaser’s status turns on the doctrine of “standing” or “ripeness.”
Additionally, a new SCOTUS rule about recurring temporary physical invasions of property delineates and expands what constitutes a “taking.” These regulation-enabled invasions present a new challenge in determining whether a valid inverse condemnation claim passes on sale.
Many of the U.S. Supreme Court's recent decisions have embraced federalism-except in one notable ... more Many of the U.S. Supreme Court's recent decisions have embraced federalism-except in one notable area. Modern Supreme Court Fifth Amendment takings cases have paradoxically diminished the role and importance of state law. Doing so creates uncertainty and unpredictability in determining where private property rights begin and where government's authority ends. The parameters of a property interest, the applicable venue, and the definition of "background principles" that limit takings claims are all subject to judicially created factors that are outside the realm of state law. Property interests are historically defined by state laws, and takings law is arguably the archetypal realm of state law. But contemporary takings cases contrast with other recent cases where the Court has enthusiastically embraced federalism. The Court has furthered federalism in access to the right of abortion and in the reach of climate change regulation, but not in the core area of property law, which is a traditional bastion of state authority under the Tenth Amendment.
The 2020 Coronavirus Pandemic and the ensuing shutdown of private businesses -- to promote the pu... more The 2020 Coronavirus Pandemic and the ensuing shutdown of private businesses -- to promote the public’s health and safety -- demonstrated the wide reach of state and local governments’ police power. Many businesses closed and many went bankrupt as various government programs failed to keep their enterprises afloat. These businesses were shut down to further the national interest in stemming a global pandemic. This is an archetypal example of regulating for the public health – preventing a direct threat that sickened hundreds of thousands of Americans. But some businesses were disproportionately hit while others flourished. Many who bore the brunt of these regulations sued, alleging their property was taken by the government without just compensation. These unfortunate businesses and individuals are unlikely to be successful, absent arbitrary action by the government or egregious circumstances. The takings clause is therefore woefully inadequate to provide what Aristotle called “dist...
In Murr v. Wisconsin,1 the United States Supreme Court
articulated a new Fifth Amendment takings ... more In Murr v. Wisconsin,1 the United States Supreme Court articulated a new Fifth Amendment takings test. The new test muddies the turbid waters of the Takings Clause by creating an additional threshold for property owners, who must now define the relevant property interest prior to proving that government action has “taken” private property. The Court could have reached the same result without resorting to a new test and creating further confusion. Prior cases defined the “relevant parcel” in terms of state law and the three Penn Central Transp. Co. v. New York City factors: the character of the government action, diminution in value, and the economic impact to the landowner. Murr departs from that existing law and creates a new threshold that lessens the import of state-specific property law. This new test complicates and elongates the takings claim process. It may make it more difficult for property owners and well-meaning government agencies to identify a valid takings claim. In the interests of fairness, predictability, and federalism, courts should defer to local and state laws in determining the parameters of the “relevant parcel.” The state laws affecting property rights are inseparable from reasonable investment-backed expectations. Penn Central should guide “relevant parcel” cases where there is ambiguity in state law or manifest interference with reasonable investment-backed expectations and where there is a significant economic impact—as part of a holistic takings analysis.
In Jordan v. Nationstar Mortgage, the Washington Supreme Court effectively eliminated a lender’s ... more In Jordan v. Nationstar Mortgage, the Washington Supreme Court effectively eliminated a lender’s ability to change the lock on a house after a borrower has defaulted on a loan – even to secure and protect the lender’s interest in the property – regardless of whether such limited entry is contractually permissible or whether the property is vacant. The case represents “a significant development in the law of Washington,” and may reverberate to the many states with lien theory statutes like Washington’s. Jordan may have the unintended consequence of harming lenders, borrowers and neighborhoods by furthering blight, increasing crime, devaluing property and preventing lenders from maintaining vacant and deteriorating homes.
This article analyzes the Jordan case, and looks at how other jurisdictions handle vacant houses in default. Ultimately, the author rejects the court’s reasoning, generally agrees with the dissent’s analysis and advocates for legislative fixes that leave defaulting property owners the right to possess their property after default and prior to foreclosure, while allowing the lender to protect its interest in vacated property and to curb the proliferation of zombie properties.
When property changes hands, the pre-existing right of the seller to
bring an inverse condemnati... more When property changes hands, the pre-existing right of the seller to bring an inverse condemnation claim against the government does not always pass to a subsequent owner. Sometimes it does. If valid takings claims expire on sale, the government may experience a windfall. But if a buyer gets a deal on burdened property and then sues under a prior owner’s takings claim, the new property owner gets a windfall. Established Supreme Court rules draw distinctions between the character of various “takings” to determine whether a claim survives a transfer of ownership. But the character of these distinctions is blurred (along with the rights of landowners) in Washington, Louisiana, and other states that continue to follow the “subsequent purchaser rule,” which is inconsistent with the U.S. Supreme Court’s ruling in Palazzolo v. Rhode Island. In those states, the determination of who gets the windfall may depend on the narrow distinction of whether a subsequent purchaser’s status turns on the doctrine of “standing” or “ripeness.”
Additionally, a new SCOTUS rule about recurring temporary physical invasions of property delineates and expands what constitutes a “taking.” These regulation-enabled invasions present a new challenge in determining whether a valid inverse condemnation claim passes on sale.
Many of the U.S. Supreme Court's recent decisions have embraced federalism-except in one notable ... more Many of the U.S. Supreme Court's recent decisions have embraced federalism-except in one notable area. Modern Supreme Court Fifth Amendment takings cases have paradoxically diminished the role and importance of state law. Doing so creates uncertainty and unpredictability in determining where private property rights begin and where government's authority ends. The parameters of a property interest, the applicable venue, and the definition of "background principles" that limit takings claims are all subject to judicially created factors that are outside the realm of state law. Property interests are historically defined by state laws, and takings law is arguably the archetypal realm of state law. But contemporary takings cases contrast with other recent cases where the Court has enthusiastically embraced federalism. The Court has furthered federalism in access to the right of abortion and in the reach of climate change regulation, but not in the core area of property law, which is a traditional bastion of state authority under the Tenth Amendment.
The 2020 Coronavirus Pandemic and the ensuing shutdown of private businesses -- to promote the pu... more The 2020 Coronavirus Pandemic and the ensuing shutdown of private businesses -- to promote the public’s health and safety -- demonstrated the wide reach of state and local governments’ police power. Many businesses closed and many went bankrupt as various government programs failed to keep their enterprises afloat. These businesses were shut down to further the national interest in stemming a global pandemic. This is an archetypal example of regulating for the public health – preventing a direct threat that sickened hundreds of thousands of Americans. But some businesses were disproportionately hit while others flourished. Many who bore the brunt of these regulations sued, alleging their property was taken by the government without just compensation. These unfortunate businesses and individuals are unlikely to be successful, absent arbitrary action by the government or egregious circumstances. The takings clause is therefore woefully inadequate to provide what Aristotle called “dist...
In Murr v. Wisconsin,1 the United States Supreme Court
articulated a new Fifth Amendment takings ... more In Murr v. Wisconsin,1 the United States Supreme Court articulated a new Fifth Amendment takings test. The new test muddies the turbid waters of the Takings Clause by creating an additional threshold for property owners, who must now define the relevant property interest prior to proving that government action has “taken” private property. The Court could have reached the same result without resorting to a new test and creating further confusion. Prior cases defined the “relevant parcel” in terms of state law and the three Penn Central Transp. Co. v. New York City factors: the character of the government action, diminution in value, and the economic impact to the landowner. Murr departs from that existing law and creates a new threshold that lessens the import of state-specific property law. This new test complicates and elongates the takings claim process. It may make it more difficult for property owners and well-meaning government agencies to identify a valid takings claim. In the interests of fairness, predictability, and federalism, courts should defer to local and state laws in determining the parameters of the “relevant parcel.” The state laws affecting property rights are inseparable from reasonable investment-backed expectations. Penn Central should guide “relevant parcel” cases where there is ambiguity in state law or manifest interference with reasonable investment-backed expectations and where there is a significant economic impact—as part of a holistic takings analysis.
In Jordan v. Nationstar Mortgage, the Washington Supreme Court effectively eliminated a lender’s ... more In Jordan v. Nationstar Mortgage, the Washington Supreme Court effectively eliminated a lender’s ability to change the lock on a house after a borrower has defaulted on a loan – even to secure and protect the lender’s interest in the property – regardless of whether such limited entry is contractually permissible or whether the property is vacant. The case represents “a significant development in the law of Washington,” and may reverberate to the many states with lien theory statutes like Washington’s. Jordan may have the unintended consequence of harming lenders, borrowers and neighborhoods by furthering blight, increasing crime, devaluing property and preventing lenders from maintaining vacant and deteriorating homes.
This article analyzes the Jordan case, and looks at how other jurisdictions handle vacant houses in default. Ultimately, the author rejects the court’s reasoning, generally agrees with the dissent’s analysis and advocates for legislative fixes that leave defaulting property owners the right to possess their property after default and prior to foreclosure, while allowing the lender to protect its interest in vacated property and to curb the proliferation of zombie properties.
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bring an inverse condemnation claim against the government does not
always pass to a subsequent owner. Sometimes it does. If valid takings
claims expire on sale, the government may experience a windfall. But if a
buyer gets a deal on burdened property and then sues under a prior
owner’s takings claim, the new property owner gets a windfall.
Established Supreme Court rules draw distinctions between the character
of various “takings” to determine whether a claim survives a transfer of
ownership. But the character of these distinctions is blurred (along with
the rights of landowners) in Washington, Louisiana, and other states that
continue to follow the “subsequent purchaser rule,” which is inconsistent
with the U.S. Supreme Court’s ruling in Palazzolo v. Rhode Island. In
those states, the determination of who gets the windfall may depend on the
narrow distinction of whether a subsequent purchaser’s status turns on
the doctrine of “standing” or “ripeness.”
Additionally, a new SCOTUS rule about recurring temporary physical
invasions of property delineates and expands what constitutes a “taking.”
These regulation-enabled invasions present a new challenge in
determining whether a valid inverse condemnation claim passes on sale.
articulated a new Fifth Amendment takings test. The new test muddies the turbid
waters of the Takings Clause by creating an additional threshold for property
owners, who must now define the relevant property interest prior to proving
that government action has “taken” private property. The Court could have
reached the same result without resorting to a new test and creating further
confusion.
Prior cases defined the “relevant parcel” in terms of state law and the three
Penn Central Transp. Co. v. New York City factors: the character of the government
action, diminution in value, and the economic impact to the landowner.
Murr departs from that existing law and creates a new threshold that lessens the
import of state-specific property law. This new test complicates and elongates the
takings claim process. It may make it more difficult for property owners and
well-meaning government agencies to identify a valid takings claim.
In the interests of fairness, predictability, and federalism, courts should
defer to local and state laws in determining the parameters of the “relevant
parcel.” The state laws affecting property rights are inseparable from reasonable
investment-backed expectations. Penn Central should guide “relevant parcel”
cases where there is ambiguity in state law or manifest interference with
reasonable investment-backed expectations and where there is a significant economic
impact—as part of a holistic takings analysis.
This article analyzes the Jordan case, and looks at how other jurisdictions handle vacant houses in default. Ultimately, the author rejects the court’s reasoning, generally agrees with the dissent’s analysis and advocates for legislative fixes that leave defaulting property owners the right to possess their property after default and prior to foreclosure, while allowing the lender to protect its interest in vacated property and to curb the proliferation of zombie properties.
bring an inverse condemnation claim against the government does not
always pass to a subsequent owner. Sometimes it does. If valid takings
claims expire on sale, the government may experience a windfall. But if a
buyer gets a deal on burdened property and then sues under a prior
owner’s takings claim, the new property owner gets a windfall.
Established Supreme Court rules draw distinctions between the character
of various “takings” to determine whether a claim survives a transfer of
ownership. But the character of these distinctions is blurred (along with
the rights of landowners) in Washington, Louisiana, and other states that
continue to follow the “subsequent purchaser rule,” which is inconsistent
with the U.S. Supreme Court’s ruling in Palazzolo v. Rhode Island. In
those states, the determination of who gets the windfall may depend on the
narrow distinction of whether a subsequent purchaser’s status turns on
the doctrine of “standing” or “ripeness.”
Additionally, a new SCOTUS rule about recurring temporary physical
invasions of property delineates and expands what constitutes a “taking.”
These regulation-enabled invasions present a new challenge in
determining whether a valid inverse condemnation claim passes on sale.
articulated a new Fifth Amendment takings test. The new test muddies the turbid
waters of the Takings Clause by creating an additional threshold for property
owners, who must now define the relevant property interest prior to proving
that government action has “taken” private property. The Court could have
reached the same result without resorting to a new test and creating further
confusion.
Prior cases defined the “relevant parcel” in terms of state law and the three
Penn Central Transp. Co. v. New York City factors: the character of the government
action, diminution in value, and the economic impact to the landowner.
Murr departs from that existing law and creates a new threshold that lessens the
import of state-specific property law. This new test complicates and elongates the
takings claim process. It may make it more difficult for property owners and
well-meaning government agencies to identify a valid takings claim.
In the interests of fairness, predictability, and federalism, courts should
defer to local and state laws in determining the parameters of the “relevant
parcel.” The state laws affecting property rights are inseparable from reasonable
investment-backed expectations. Penn Central should guide “relevant parcel”
cases where there is ambiguity in state law or manifest interference with
reasonable investment-backed expectations and where there is a significant economic
impact—as part of a holistic takings analysis.
This article analyzes the Jordan case, and looks at how other jurisdictions handle vacant houses in default. Ultimately, the author rejects the court’s reasoning, generally agrees with the dissent’s analysis and advocates for legislative fixes that leave defaulting property owners the right to possess their property after default and prior to foreclosure, while allowing the lender to protect its interest in vacated property and to curb the proliferation of zombie properties.