Possible Victory for Property Rights Coming Soon

yeayo · Mar 4, 2006

Property Rights Case Heard in Supreme Court May Impact Rent Control

On February 22, the U.S. Supreme Court heard oral arguments in a property rights case that has major implications for rent control in manufactured home communities. The case Lingle verus Chevron, originally stems from a law passed in 1997 by the Hawaii state legislature which established a cap on the maximum rent an oil company may charge a lessee-dealer. The intent was to help address the very concentrated gasoline market that was resulting in the high price of gasoline to consumers. Chevron sued on the grounds that the law was unconstitutional as an uncompensated taking of its property in violation of the Fifth Amendment.

The District Court found in favor of Chevron, and the U.S. Court of Appeals for the Ninth Circuit Court affirmed the decision. The U.S. Supreme Court agreed to hear the case, and now basically it can endorse the Ninth CircuitÃ¯Â¿Â½s decision, thereby strengthening the ability of small property owners to challenge rent control as an unconstitutional taking, or it can rule in HawaiiÃ¯Â¿Â½s favor, thereby effectively finding that all types of rent control laws are constitutional.

NCC members are following this case closely, and some have joined the case on behalf of Chevron by writing amicus briefs. The Pacific Legal Foundation filed an amicus brief on behalf of the Western Manufactured Housing Communities Association, and another brief was filed by Jenner and Block, LLP, on behalf of Equity Lifestyle Properties, Inc. (formerly MHC), and the California Mobilehome Parkowners Alliance.

Both briefs argue that it is essential for the Supreme Court to maintain that if a regulatory rent restriction is placed on real property, then there must be a substantial advancement of a legitimate state interest in order for such a restriction to be legal. Should the U.S. Supreme Court affirm the Circuit CourtÃ¯Â¿Â½s decision, this opens the door to challenge other forms of regulated rent control.
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http://www.manufacturedhousing.org/publications/default.asp?id=10&article=116

yeayo · Mar 4, 2006

Hope Roberts and Alito pull thru on this one. Hope they don't let those who wear pink underwear defeat property rights on this important issue.

yeayo · Mar 4, 2006

http://www.commondreams.org/views05/0221-26.htm

Is Your Stuff Yours? The Answer Isn't So Simple
Seeking to limit government seizures, conservatives take the issue to court.
by Martin Garbus

On Tuesday, the U.S. Supreme Court will be faced with the following question: Under what conditions, if any, can the government take property from you or your business for the public good? Although the question sounds straightforward enough, its answer will have profound, complex Ã¢â¬â and terribly important Ã¢â¬â consequences for the future of American social policy.

Under current law, the government can take your house or land. In order to do so, it must merely show that the property is being taken for a legitimate "public use," and it must pay a fair compensation. That's the law of "eminent domain." It can also, under certain circumstances, take money out of your business or limit the amount of money you can take out of your business, if it has a good, publicly beneficial reason to do so.

But although these are the rules under which our government has operated for the last 85 years, they're not making everyone happy. In the first of two obscure cases coming before the court on Tuesday, Kelo vs. City of New London, the city of New London, Conn., took property from homeowners in order to build an economic development area that was presumably going to give the city desperately needed funds. The homeowners said the government might have had the right to take the land if it had become a slum, or if it was in some way blighted, but not for a purely profit-making enterprise Ã¢â¬â even if they were provided fair compensation. The owners argued that the community they had lived in for many years, with their friends and family surrounding them, and the property itself, could not be replaced by dollars. Why, the landowners argued, should they arbitrarily and capriciously be singled out to help the entire community get income? The Connecticut Supreme Court, however, upheld the city's right to take the land.

In the second case, Lingle vs. Chevron, Chevron challenged a Hawaii law limiting the maximum rent that oil companies could collect from dealers who leased company-owned service stations. The state had passed the law in order to hold down gasoline prices, but the federal appeals court agreed with Chevron that the rent control regulations were unconstitutional because the government had no right to, effectively, "take" rent that dealers had been prepared to pay to Chevron.

Chevron, in its brief before the Supreme Court, argued that the government could not arbitrarily take from the company profits that would otherwise be shared by its stockholders.

Why, Chevron asked, should one class of citizens lose out to another class? Why should corporate stockholders (much like the property owners in the Connecticut case) be arbitrarily and capriciously made to pay to solve society's problem? Wouldn't it make more sense, Chevron asked, for the entire community to pay?

At the heart of the issue in both cases is a little-known sentence in the 5th Amendment to the Constitution known as the "Takings Clause" that says, "Nor shall private property be taken for public use, without just compensation." The Takings Clause is the part of the Constitution that gives rise to the government's power of eminent domain.

But in recent years, conservatives have taken issue with that interpretation. The clause, in the view of University of Chicago Law School professor Richard Epstein and some of his judicial and academic colleagues, has been misinterpreted to justify virtually any governmental "interference" with the owner's right to possess, use and dispose of property. Epstein and his colleagues say that, on the contrary, the clause is meant to protect property owners and should be used to strike down regulations that interfere with the profit of an individual or corporation. That might mean regulations allowing the government to take your house Ã¢â¬â or environmental regulations that are costly to businesses or health and safety standards that businesses find onerous. Even minimum-wage laws could be deemed unacceptable under this theory.

If Epstein and his allies are victorious, it will be the culmination of a long-standing conservative battle to constitutionally undermine the New Deal administrative state.

In the 1980s, Edwin Meese, Ronald Reagan's attorney general, urged his department to present "takings" cases to courts that he believed would be sympathetic to the restricting regulation. Today, with the strongly pro-corporate Rehnquist court in place, the Bush administration sees another chance to create an unfettered free market.

But these arguments go back even further than Reagan, resurrecting a battle waged before the court between 1890 and 1916. That was a period of strikes and sweatshops, low wages and long hours, tenement living and economic tumult. As a result of new progressive forces and the beginning of unionism, dozens of states passed legislation to regulate sanitary conditions as well as to reform working conditions and reduce work hours.

But the court was having none of it. In 1905, in a 5-4 decision in the case of Lochner vs. New York, the court ruled that New York's attempt to regulate hours of labor in bakeries was unconstitutional because the law "necessarily interfered with the right of contract between the employer and the employee." Justice Rufus Peckham wrote that the 14th Amendment of the U.S. Constitution guaranteed a company's right to purchase and sell labor on any terms management could bargain for.

Lochner and its overbroad anti-regulatory attitude was later rejected. But these days, justices Clarence Thomas and Antonin Scalia are inching back to those legal concepts.

The rest of the court is not quite in agreement yet, but the continued appointment of irresponsibly pro-business judges could bring us there.

Do we really want to allow the court to obstruct socially desirable legislation in the name of the property rights of corporations?

The Takings Clause could give the Supreme Court a powerful new weapon to severely restrict government attempts to work for the public good Ã¢â¬â and we should be very wary about how that weapon is wielded.

Martin Garbus is a trial lawyer in the law firm of Davis & Gilbert in New York.

ÃÂ© 2005 LA Times
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If Roberts and Alito don't side with private property on this issue then that would be the biggest failure of the Bush Admin. Cause the pinks seem like they may seize government control in 2006 and 2008. We need powerful property rights advocates on the Supreme Court to fight these socialists when the come to power especially during a recession.

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Possible Victory for Property Rights Coming Soon

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