Lucas v. South Carolina Coastal Council
505 U.S. 1003 (1992)

  • Lucas bought some beachfront property on an island for $975k in order to build a pair of houses.
  • Two years later, the South Carolina legislature passed the Beachfront Management Act that made it illegal for Lucas to develop the land. Lucas sued.
    • Lucas argued that the law constituted a taking of his property without just compensation, hence a violation of the 5th Amendment.
      • Under the 5th Amendment, the government has a right to take land, but it must be for the public good and there must be compensation.
    • South Carolina argued that this was a legitimate use of police power because Lucas’ construction would cause beach erosion and the destruction of a valuable public resource.
  • The Trial Court found for Lucas. South Carolina appealed.
    • The Trial Court found that the new law deprived Lucas of 100% of the economic value of the land, and therefore constituted a taking.
    • Even if Lucas didn’t lose 100% of the value, clearly he lost the “primary investment backed expectation” value that was mentioned in Penn Central v. City of New York (438 U.S. 104 (1978)).
  • The South Carolina Supreme Court reversed. Lucas appealed.
    • The South Carolina Supreme Court found that the Statute served a valuable public purpose and therefore no compensation was required by the 5th Amendment.
  • The US Supreme Court reversed and remanded for trial.
    • The US Supreme Court found that there are two clear-cut cases of regulatory takings:
      • Physical occupation of private property.
      • Denial of all economically productive use of private property.
    • The Court found that when the State deprives a property owner of 100% of the economic value of their land for some public purpose, it is a taking unless the use that is being taken away was never part of the title to the land in the first place.
      • For example, it’s not a taking to deprive the owner of the right to create a nuisance on their land, because that wasn’t part of their property rights anyway.
    • The Court remanded for trial since South Carolina could possibly show that if Lucas’ intended use of the land constituted a nuisance, the law would stand and Lucas would not get compensation.
      • South Carolina had a reasonable argument that causing the erosion of a public beach was a nuisance.
  • This case established the total takings test for evaluating whether a particular regulatory action constitutes a regulatory taking that requires compensation.
    • Basically, the Court held that land use regulations that prohibit all economic uses of a property are takings, unless the prohibited uses are nuisances.
    • Total takings analysis requires a consideration of:
      • The degree of harm to public lands or adjacent property posed by the regulated activities.
      • The social value of such activities.
      • The relative ease with which the alleged harms can be avoided through measures taken by either the claimant or the government.
  • Did Lucas’ land really lose “all economic value” as the majority suggested? In a dissent, it was argued that the land was still quite valuable for camping and such. If the land still has some economic value, it isn’t covered by the total takings doctrine that the Court developed for this case.
    • The dissent felt that the test shouldn’t be whether the prohibition results in the availability of some residual value or not, but whether the government interest was sufficient to prohibit the activity given the significant private cost.
  • In another dissent, it was argued that the new rule is rather arbitrary. If someone loses 100% of the value of their land, they are entitled 100% compensation, but if they only lose 95% of the value, they are entitled to nothing. That doesn’t seem fair.
    • Some States agree, and have enacted Statutes that provide for some compensation when a regulation partially reduces the value of a property.