ALTHOUGH it was overshadowed by the hullabaloo over the Supreme Court's abortion ruling Monday, the justices that day handed down another important decision attempting to strike a balance between individual rights and government regulation. The court said that in some cases the state must compensate private-property owners for the economic effects of environmental and other land-use restrictions.
The case was brought by a property owner in South Carolina who paid $975,000 for two beach-front lots he planned to develop. He sued the state after new regulations prohibited further building on the fragile coastline; the restrictions, he contended, constituted a "taking" of property by government, requiring compensation under the Constitution. Previously courts have held that the so-called takings clause applied only to actual confiscations of private property, for example to build a road.
A majority of the justices agreed that government must compensate property owners when land-use regulations prohibit "all economically beneficial uses in the name of the common good." But the court stopped far short of the ringing endorsement of private-property rights that many advocates had hoped for. While it left many questions unanswered, the court seemed to say that government will not be economically inhibited from imposing reasonable environmental and other regulations that leave landowners with some use options.
Land is the most valuable asset held by many individuals and small businesses, and government shouldn't be allowed simply to wipe out the value of property, even for environmental protection.
But property law has long recognized the need to restrict "nuisance" uses that harm adjacent land or threaten the public interest. Modern research has identified harmful land-use practices beyond those traditionally recognized. Property owners can rightly be expected to be aware of public-interest concerns and to assume some of the risk that government will act to protect the public interest.