Hawaii Supreme Court Oral Arguments In Lucas "Economically Beneficial Use" Taking Case

MP3: AUDIO LINK

by Robert Thomas, InverseCondemnation, January 12, 2017

After the Hawaii Supreme Court decided GATRI v. Blane, 962 P.2d 367 (Haw. 1998) one big question remained.

In GATRI, the court held that in the coastal zone, a county Community Plan (also known as a "General Plan" in some counties) is a binding land use regulation, and thus has the force and effect of law. (Outside the coastal zone, the CP/GP's don't actually control any land uses, and are general statements of long-term planning goals. The zoning, and the zoning alone, regulates the uses of land.)

But the state legislature in the Coastal Zone Management Act mandated a different result in the coastal zone and there, the planning also controls land use, as the court held in GATRI. Thus, in order to develop property in the coastal zone in accordance with the applicable zoning, the applicable CP/GP must also permit the use. This is know as "plan-zone consistency," and when the zoning and the planning are consistent, all is well.

The big question, however, is what happens when the zoning and the CP/GP are not consistent? First, we know that as a consequence of the inconsistency, the landowner cannot use her land in accordance with the zoning. Second, what, if any uses can be made of the property under the CP/GP designation? If none, this should set off your takings alarm bells: when a property is deprived by regulation of its economically beneficial uses, what is left but a Lucas wipeout?

As we detailed in our preview post, this is the issue confronting the Hawaii Supreme Court in a case argued last week, Leone v. County of Maui. There, the parcel is zoned "Hotel" (which permits residential use as a matter of right), but is designated on the CP as "park." In other words, its GATRI inconsistent.

We won't go into the background or the arguments made by each side (for details, see our earlier post, and the amicus brief we filed in support of the property owners in an earlier phase of the case in which the County lost its argument that the case wasn't ripe under Williamson County because the owners hadn't made an attempt to get the hotel zoning and the park CP consistent by seeking an amendment to the CP which would allow for residential use). Instead, we've posted the oral argument recording above for your edification.

After the Court of Appeals correctly determined that Williamson County doesn't require a takings plaintiff to seek a change in the law in order to ripen her claim, the Lucas wipeout question ended up being presented to a Maui jury, which somehow concluded that despite the plan/zone inconsistency, the Leones' have some economically viable uses remaining.

What those uses are, we can't imagine. We know the Leones can't build a home which the hotel zoning would otherwise permit. And we know the Leones can't make use of it as a park because the lot is too small (the minimum lot size in the park CP is 1 acre, and the Leone parcel is less than 1 acre). That should have been game, set, and match.

But it wasn't, and after the adverse jury decision, the property owners appealed. To explain the verdict, the County made all sorts of arguments that in our view, can't be harmonized in a way that makes any sense under the Fifth Amendment or federal court case law. Who knows, maybe the jury bought the County's argument the Leones could hold the property for "investment" purposes (in other words, despite it being frozen out of present uses today, in the future it might have value), despite that argument being foreclosed as a matter of Fifth Amendment law by cases like Lost Tree. Or maybe the Leones really could open a park concession or something and that is an economically beneficial use of the parcel, even though the CP says otherwise. Or maybe they could have somehow convinced the County to let them build a home, even though it is flatly prohibited by their own rules and GATRI, and that it wasn't the inconsistency which caused the County to deny the Leones' application to build. (Other neighboring homeowners eventually secured the County's ok, and even though those parcels were in different situations, the County pointed to them and argued why not the Leones as well?)

MP3: AUDIO LINK

The oral argument recording (above and at the top of the post) has all of the details, and is a worthy listen for you takings junkies. The issues are all there: Williamson County, Lucas, Nollan/Dolan, nothing omitted.

Check it out.

PDF: Brief Amicus Curiae of Pacific Legal Foundation, Leone v. County of Maui, No. 29696 (Haw. App. filed. Sep....