A Jargon-Free Property Rights Update for Forest Landowners

Thanks to the Southeastern Wood Producers Association for inviting me to give its membership a "Forestry and Property Rights Legal Update" in the latest edition of its newsletter, Out of the Woods. It's excerpted below:

Forestry and Property Rights Legal Update

In recent months, there have been several legal developments that property owners and those involved in forestry should know about. Having some familiarity with these legal issues can be an important service to the landowners that members of this Association work with.

You’ve probably heard about the forest roads lawsuit, Decker v. NEDC, argued before the U.S. Supreme Court in early December. At stake is whether logging roads and ditches need federal stormwater permits. Since the 1970s, EPA has agreed they do not with its “Silvicultural Rule.” When environmentalists sued in Oregon, a federal court ruled that EPA was incorrect. Last year, Congress blocked EPA from developing the new permit while the case was on appeal.

The case before the Supreme Court looked strong. EPA, however, complicated things by issuing a new rule intended to replace the faulty Silvicultural Rule on the eve of the case being heard. While the new rule helps the forestry community by generally not requiring permits for logging roads and ditches, the Supreme Court seemed concerned about this new development. The Supreme Court should rule by July. For now, it has asked the parties for further information about EPA’s new rule. The only real solution here is congressional action, so talk to your U.S. representative and senators about this issue.

Two important property rights cases have not been in the news quite as much. One case, Koontz v. St. Johns River Water Management District, questions bargaining practices that governments use for land-related permits. There, the government agreed to issue a permit to fill wetlands if the landowner paid to improve government culverts miles away. The landowner refused and sued when the government denied the permit. The Florida Supreme Court said the landowner could only challenge the unreasonable permit demand after giving in to it.

The outcome of Koontz will be important to all landowners—even average homeowners and agricultural landowners. The growth in government at all levels means that every landowner in the country is now subject to a complex permitting regime. Imagine a local government that requires you to buy $25,000 in new library books in order to get a permit to build a new deck. Or a state agency that requires a timberlands owner in the Panhandle to build a nature walk in South Florida to get a permit to build a logging road. The Supreme Court is being asked to decide how far these outrageous requests can go. I was fortunate to be involved in this case. I watched the oral arguments in Washington, D.C. in January and am cautiously optimistic that the Justices will support the landowner.

The other recent property rights case before the Supreme Court has already been decided—and it was a big win for landowners and forestry. In Arkansas Game and Fish Commission v. United States, the Supreme Court held that a landowner could be compensated where the federal government’s temporary flooding of the property destroyed millions of dollars of standing timber.

From the beginning of the Republic, governments have tried to get out of paying compensation for property they take by arguing it was for the public good. The Supreme Court once again rejected this argument. The Constitution, it said, requires the government to pay landowners for damages to property, no matter whether the government had a good reason for its actions or not.

We must be our own advocates for property rights and the sound environmental practices used in forestry. As these cases illustrate, we must remain diligent in working to protect our property rights and livelihoods. The next time you talk to a landowner, tell them about these recent developments. Remind them about the legal struggles that our industry faced and is still facing out West because our laws prioritize the Northern Spotted Owl above people. It could happen here if we are not mindful.

Jacob T. Cremer is an attorney at Bricklemyer Smolker, P.A., in Tampa. His practice focuses on property rights, environmental, and land use law. He grew up in a family that has been involved in forestry in Florida for many generations. Follow the developments on these cases and others at his blog, The Florida Land Environment.

Friday Roundup of Environmental & Property Rights Cases before the U.S. Supreme Court

This was a big week at the U.S. Supreme Court for environmental and property rights cases. What's my soundbite? The environmental cases are extremely unlikely to actually resolve anything, which will certainly lead to more litigation. The property rights case was a big win for landowners.

First, as I discussed earlier in the week, the Court issued its opinion in Arkansas Game & Fish Commission v. United States, No. 11-597 (cert. granted Apr. 2, 2012), holding that where the government causes flooding, even if the flooding is merely temporary and non-recurring, it may be liable for a taking. Commentary and recaps:

• SCOTUSblog analysis of the opinion.
• Collection of commentary at SCOTUSblog.
• Robert Thomas at InverseCondemnation collects commentary and gives his own detailed thoughts.

Second, the Court heard the Forest Roads case (consolidated: Decker v. NEDC, No. 11-338, and Georgia-Pacific West, Inc. v. NEDC, No. 11-347). As I blogged about previously, EPA issued a new final rule about logging roads on the eve of oral arguments, so the Court spent most of its time discussing what should be done in light of the new development. After this, I question whether this case will actually resolve anything about the Clean Water Act. Commentary and recaps:

• The SCOTUSblog preview and recap.
• Lawrence Hurley reports over at Greenwire.
• From the New York Times.
• The National Alliance of Forest Owner's blog, which as always, boils down the legalese into something that's easy to understand, if unfortunate: "Perhaps the most significant impact of the new rule is that it will perpetuate litigation in the Ninth Circuit with the added twist that, since the rule applies nationwide, whatever the Ninth Circuit ultimately decides will apply nationwide as well. The NEDC attorney told the Court in very clear terms that NEDC intends to continue litigation by whatever means to require permits for forest roads, stating:“…we contend that the new rule simply violates the statute, and we have a right to bring a citizen suit for a violation of the Clean Water Act itself…I think that what we’ll do is proceed whatever way we can.”"

Third, the Court heard the other Clean Water Case, Los Angeles County Flood Control District v. NRDC, No.11-460 (cert. granted June 25, 2012). As with Decker, it appears that this case may not end up resulting in much insight because all parties agreed the Ninth Circuit was wrong; they just disagreed on how to fix the error. It also appears that most of the arguments are permit-specific and an opinion from the Court would likely be confined to the facts. Commentary and recaps:

• SCOTUSblog has a great preview and excellent recap of why this case will probably not end up being all that important.
• The transcript.
• From the L.A. Times.
• One Los Angeles blog thinks this case was all about money behind the scenes.

U.S. Supreme Court Refuses to Elevate Vague Public Interest above Private Property Rights

In a unanimous opinion today by Justice Ginsburg, the U.S. Supreme Court refused to elevate vague public interests above private property rights. The Court's opinion in Arkansas Game & Fish Commission v. United States, No. 11-597 (cert. granted Apr. 2, 2012), explains that where the government causes flooding, even if the flooding is merely temporary and non-recurring, it may be liable for a taking.

The Court roundly criticizes the government for attempting to carve out exceptions to the Takings Clause. It rejects the familiar argument that is made in nearly every takings case that the government won't be able to do its job if it is burdened with the mandate to pay just compensation:

There is thus no solid grounding in precedent for setting flooding apart from all other government intrusions on property. And the Government has presented no other persuasive reason to do so. Its primary argument is of the in for a penny, in for a pound genre: reversing the decision below, the Government worries, risks disruption of public works dedicated to flood  control.  “[E]very passing flood attributable to the  government’s operation of a floodcontrol project, no matter  how brief,” the Government hypothesizes, might qualify as a compensable taking. Brief for United States 29.  To reject a categorical bar to temporary-flooding takings claims, however, is scarcely to credit all, or even many, such claims. It is of course incumbent on courts to weigh carefully the relevant factors and circumstances in each case, as instructed by our decisions. See infra, at 14. 

The slippery slope argument, we note, is hardly novel or unique to flooding cases. Time and again in Takings Clause cases, the Court has heard the prophecy that recognizing a just compensation claim would unduly impede the government’s ability to act in the public interest. Causby, 328 U. S., at 275 (Black, J., dissenting); Loretto, 458 U. S., at 455 (Blackmun, J., dissenting).  We have rejected this argument when  deployed to urge blanket exemptions from the Fifth Amendment’s instruction. While we recognize the importance of the public interests the Government advances in this case, we do not see them as categorically different from the interests at stake in myriad other Takings Clause cases.  The sky did not fall after Causby, and today’s modest decision augurs no deluge of takings liability.

This is a solid opinion for property owners that brings some much-needed clarity to the law. It's good to see a unanimous opinion protecting property rights. The Court also seems comfortable that its current takings precedents cover most situations, making it disinclined to adopt any new rules. We may see more of this philosophy in January when the Court hears Koontz v. St Johns River Water Management District, No. 11-1447 (cert. granted Oct. 5, 2012). This still leaves the petitioning property owner there in a good position because the biggest stretch the Court would need to make is to modestly expand its current caselaw. Dolan v. Tigard, 512 U.S. 374, 391 (2005); Nollan v. Cal. Coastal Com., 483 U.S. 825, 837 (1987).

I'll post more analysis later, but until then my archives on the case are here. My fellow blogger Robert Thomas has already posted some of his initial thoughts.

The Other Clean Water Act Case: One of Five Cases Relevant to Property Owners Before the U.S. Supreme Court

With all of the environmental and land use cases on the Court's docket this term, it's shaping up to be an important year for property owners (and maybe another tough year for environmental interests). It's may also be a year of correction for the Ninth Circuit, since several of these cases are out of that Circuit. It's unusual for the Court to hear so many of this type of case in the same term; it's unclear whether this is just a coincidence, or if there is something else driving their interests. These cases, with links to my commentary about them, are below:

• Arkansas Game & Fish Commission v. United States, No. 11-597 (cert. granted Apr. 2, 2012, argued Oct. 3d, 2012), concerning the federal government's taking of timber by flooding.
• Decker v. NEDC, No. 11-338 (cert. granted June 25, 2012, to be argued Dec. 3, 2012) (consolidated with Georgia-Pacific West, Inc. v. NEDC, No. 11-347), about the viability of the EPA's Silvicultural Rule under the Clean Water Act.
• Los Angeles County Flood Control District v. NRDC, No.11-460 (cert. granted June 25, 2012, to be argued Dec. 4, 2012), which will consider whether the District should be held liable under the Clean Water Act for polluted stormwater that is discharged into two rivers.
• Koontz v. St Johns River Water Management District, No. 11-1447 (cert. granted Oct. 5, 2012, to be argued Jan. 15, 2012), regarding a government's failed attempt to exact personal property in connection with a land use permit.
• Horne v. U.S. Department of Agriculture, No. 12-236 (cert. granted Nov. 20, 2012), considering whether a New Deal agricultural statute takes property of raisin growers without compensation.

Next week, the U.S. Supreme Court will hear oral arguments in two of these cases, both of which concern the Clean Water Act. My readers know that I've followed the first very closely because, here in Florida, so much of my practice representing agricultural landowners relates to forest landowners. And, sure, it doesn't hurt that I'm in the fifth generation of my family in a profession dealing with forestry. Those cases are the forest roads litigation (consolidated: Decker v. NEDC, No. 11-338, and Georgia-Pacific West, Inc. v. NEDC, No. 11-347).

The second case is the only case among this bunch that I haven't discussed in any detail: Los Angeles County Flood Control District v. NRDC, No.11-460 (cert. granted June 25, 2012). I have not spent much time discussing this case because it does not directly affect my main audience of private landowners. The case could, however, have implications for some private landowners, as indicated by the National Association of Home Builders' amicus brief. As it points out, "[f]or all its complexity, the Clean Water Act is simple in one respect-it creates liability for a person who adds pollutants to 'a water of the United States' through a 'point source.'" The main issue I see that could ensnare a private landowner is that, if the Supreme Court rules against the District, then those who merely convey pollutants into a water of the United States could be exposed to liability, even if others actually create the pollutants. However, as the Solicitor General of the United States argued, no matter what the ruling in this case, the Supreme Court should be able to confine it to the unique facts of this case.

You can follow the case's progress at SCOTUSblog, or read here for much more depth about the legal issues in this case.

What If the Government's Power Plant Kills Your Chickens? More on Elevating Public Interest above Private Property Rights

The transcript for today's flood takings case argued before the U.S. Supreme Court is out. Arkansas Game & Fish Commission v. United States, No. 11-597 (cert. granted Apr. 2, 2012). As Lawrence Hurley points in out in his recap of today's oral argument, a majority of the Court seemed sympathetic to the property owner's plight. As always, the justices tossed out some fun, nearly nonsensical hypotheticals that make lawyers recall their worst days in law school.

Earlier this week, I explained that, behind the legal doctrines, is a simple philosophical question: should property rights depend on the importance of the public interest? Today, the federal government said that's exactly the case (represented below by Mr. Kneedler). In fact, Congress had been good enough to help these landowners to begin with, so that the landowners should have known that the government could later decide to flood their lands:

MR. KNEEDLER: I don't believe that that's correct. I mean, that -- that would turn on the happenstance of what a particular landowner had -- had on his property downstream. And I think the government, in operating the general project, cannot be held to do an investigation of every property owner. Again, it's releasing water generally. And if we -- maybe if I could use the levy example here. This -- the release changes that were made here were made to protect farmers so that they could -­ so that they could plant more crops and not -- and be protected during their harvesting.  If you shift back to what the Corps -- to the Corps' regular operating scheme, it affects the farmers. There might be a flood -­ 

MR. KNEEDLER: It is in the nature -­ 

JUSTICE SCALIA: That doesn't seem to me particularly fair. 

MR. KNEEDLER: It is in the nature of living along a river. Riparian ownership carries with it certain risks and uncertainties, from weather, from intervening causes. The government is -- there are a thousand square miles, more square miles of drainage area -- 

JUSTICE SCALIA: I don't think -- one of those risks has to be the Government's going to make you pay for protecting somebody else.  Is that one of the risks? 

MR. KNEEDLER: Well, when -- picking up on what I said about Congress, Congress would not have
gotten into the flood control business without this protection of liability. People -­

JUSTICE SCALIA: I doubt that.

JUSTICE SCALIA: I mean, the issue is who is going to pay for the wonderful benefit to these farmers. Should it be everybody, so that the government pays, and all of us pay through taxes, or should it be this -­ this particular sorry landowner who happens to lose all his trees?

Even Justice Breyer agreed that this position was absurd, since the government undertakes public works in many fields, and in all of them it must compensate a property owners if something goes awry and property is taken:

JUSTICE BREYER: But building a Government project, let's say an electricity plant or high tension wires, you could require the taking of some land to build it. Now, you've got that and you begin to run it. You could run it in such a way that it takes some of the property. I mean, the electricity could, for example, because of some odd thing run around over somebody's land and kill all the chickens. That wasn't expected but it happens, and it happened because of the way the Government runs the plant. Now, I guess there would be a taking in such circumstance if in fact, because of the way it's run, it makes that land which no one thought would happen, as a consequence of the project uninhabitable; wouldn't there be? 

MR. KNEEDLER: Well, again, it depends. If the Government -- if the Government is occupying the land when it happens, yes. But there's -- as you've I think pointed out, there's a critical difference between a tort and a taking. And there -- there can be collateral consequences of what the Government does that -- that cause injury. 

JUSTICE BREYER: The collateral consequence is to make some piece of land 4 miles away quite unexpectedly but totally uninhabitable. Now, what's supposed to happen there? That's not just a trespass because it's permanent. And even if it's once every 2 years, it's permanently once every 2 years.

Hopefully the rest of the Court will agree that it is absurd to elevate the public interest so much that a private landowner must single-handedly bear a burden that results from a benefit given to the public at large. Otherwise, expect to see less private investment in areas near government public works.

Property Rights at Stake This Week: Should Property Rights Depend on the Importance of the Public Interest?

Last week, I previewed the property rights case to be argued this week before the U.S. Supreme Court. Arkansas Game & Fish Commission v. United States, No. 11-597 (cert. granted Apr. 2, 2012). I focused on the legal arguments in the case, which seeks payment for the extensive timber that was destroyed when the Army Corps of Engineers flooded the Commission's property. Lawrence Hurley has written a great article giving a feel for just how important this case is at the local level. The article also explains the property rights at stake and the implications of the case:

The case could have implications beyond the narrow question of Army Corps-directed water discharges. Those keen for the Supreme Court to become more active in the property rights area, like Jonathan Adler, a law professor at Case Western Reserve University School of Law, certainly hope so. "We don't see many property rights cases," he said. "The language of the opinion will really matter." 

Others are wary of the Supreme Court expanding the definition of what constitutes a taking. John Echeverria, a professor at Vermont Law School, is concerned that any kind of ruling in favor of Arkansas could have "enormous implications" for local governments. 

Although the federal government is the defendant in the case before the court, local governments are far more likely to be on the receiving end of such claims if the Supreme Court endorses the practice, Echeverria wrote in a brief in support of the Army Corps filed by the International Municipal Lawyers Association and other local government groups. 

In an interview, Echeverria said property rights advocates would be keen for a broad ruling on "temporary takings" that could prompt challenges to such activities as government inspections of property. "This is one front of a multifaceted debate over property rights," he added. "The property rights advocates see it as an opportunity to expand the doctrine."

Professor Echeverria is well known for having never seen a property rights claim that amounted to a taking. He supported the State of Florida before the U.S. Supreme Court in Stop the Beach Renourishment, Inc v. Florida Dept. of Environmental Protection, 130 S. Ct. 2592 (2010). In that case, I worked for counsel of record in representing the property owners after the Florida Supreme Court rewrote its waterfront property law. 

In this case, Professor Echeverria "urge[s] the Court to avoid an interpretation of the Takings Clause that would impose unreasonable new burdens on local governments charged with addressing flooding threats and other serious water management challenges":

The facts of this relatively unique case have the potential to obscure the particular threats to local governments posed by the arguments of Petitioner and its  amici curiae for extending physical takings octrine to temporary occupations or invasions. In a variety of contexts, for a variety of important public purposes, government officials intentionally or inadvertently cause temporary or occasional physical invasions of private property. Exposing local taxpayers to potential financial liability under the Takings Clause for all such incidental injuries to property would impose significant  new financial burdens on already straitened local governments as well as impede important government functions. In other words, in the context of  temporary invasions or occupations, as much as with regulatory restrictions, “government hardly could go on” if it could be held liable under the Takings Clause every time it acted. Pennsylvania Coal Co. v. Mahon, 260 U.S. 393, 413 (1922). 

Of most immediate concern, Petitioner’s proposed takings theory would seriously undermine the ability of local governments to address a host of local water management issues. Managing the flow of storm water, sewage and other forms of water is one of the most important and difficult functions of local government.

Professor Echeverria seems to miss the point of constitutional protection of property rights entirely. As is always the case in property rights disputes, there are many competing interests at stake here. The interests of farmers and others that the Army Corps was working towards when it flooded the Commission's property are certainly important, as were the more general interests of the public in being protected from flooding. That makes this case all the more compelling: property rights must be respected, no matter how compelling the public interest is. Any other rule cheapens the freedoms we've worked so diligently for in this country.

Takings Case to Watch before the U.S. Supreme Court: Arkansas Game & Fish Commission v. United States

Next week, on October 3d, the U.S. Supreme Court will hear an important case for property rights: Arkansas Game & Fish Commission v. United States, No. 11-597 (cert. granted Apr. 2, 2012). Property owners should be concerned about this case because it could affect their investment decisions, especially investments related to natural resources. If the decision below stands, landowners will oftentimes be uncertain of whether they deserve compensation when the government floods their property.

In this case, the Federal Circuit Court of Appeals, which reviews takings claims against the federal government, held that the flooding of private land cannot be a taking. The only exception is where the government intends for the flooding to be a permanently recur on the property. The Federal Circuit held that courts should not look at the damages caused by the flooding or the time it lasted, but rather on the character of the policy behind the intrusion. The Federal Circuit then held that each flooding instance was merely a temporary policy not subject to review. Consequently, the Commission could not recover for the timber that the federal government killed by flooding.

The Legal Information Institute at Cornell has published a concise summary of the case:

The Arkansas Game and Fish Commission (“the Commission”) is an agency that works to regulate and preserve Wildlife Management Areas in Arkansas. One of the areas that the Commission manages (the “Management Area”) is a bottomland hardwood forest in the Upper Mississippi Alluvial Valley, home to diverse wildlife and hardwood timber species. The Black River runs through the Management Area. One way that the Commission regulates the Management Area is by harvesting timber in the area and then planting new trees. The Commission also controls the flooding of multiple reservoirs in the Management Area to improve the habitat for migratory waterfowl. 

On March 18, 2005, the Commission filed a lawsuit in the Court of Federal Claims against the United States claiming that from 1993 through 2000, the United States effectuated a taking of the Commission’s property and failed to provide compensation. The Commission argued that during those years, the United States Army Corps of Engineers (“the Corps”), deviated from the Corps’ 1953 water control plan for the Clear Water Dam, which regulates the flow of the Black River. The Commission claims that the deviations caused increased flooding in the Management Area, which devastated the timber in the region. The Corps deviated from the 1953 water control plan to help farmers near the Management Area. 

In December 2008, the Court of Federal Claims conducted a hearing concerning the Commission’s lawsuit. At the hearing, the United States argued that the flooding in the Management Area was temporary and therefore did not constitute a taking. The Court of Federal Claims rejected the United States’ argument and awarded the Commission $5.5 million for the damage resulting from the flooding and $176,428.34 to regenerate the Management Area. The United States appealed to the Court of Appeals for the Federal Circuit (“Court of Appeals”), arguing that a taking had not occurred and the Commission cross-appealed, requesting more funds for regeneration. The Court of Appeals ruled in favor of the United States and then denied the Commission’s petition for a rehearing. On April 2, 2012, the Supreme Court of the United States granted the Commission certiorari to consider whether flooding has to be permanent to constitute a taking under theTakings Clause of the Fifth Amendment. On August 16, 2012, the Commission rejected a $13 million settlement offer from the United States because the United States refused to agree that the Corps would not increase the flooding in the Management Area again.

One interesting aspect of this case is that it has not pitted environmental interests against property rights, as is often the case. Jonathan Adler has gone so far as to call it "A Takings Claim Even Environmentalists Could Love." For more in-depth reading, here are the briefs in the case. You might also check out Robert Thomas's excellent blog, where Robert has discussed the case in depth along with the amicus brief that he filed supporting the property owner.

I'll prove updates in the coming weeks once reports from oral argument at the Supreme Court come in.