Knick v. Scott Township Reopened the Federal Courthouse to Landowners

A cemetery is an odd place to start a constitutional revolution. Nobody in a graveyard is in a hurry, nobody is lobbying, and the residents have never once filed a brief. Yet a small family burial ground on a Pennsylvania farm ended up undoing a rule that had stood since 1985, and the way it got there tells you most of what you need to know about how government treats property owners when it thinks nobody is watching.

This is the story of Knick v. Township of Scott, decided on June 21, 2019. It is a short story with a plain moral: a right you cannot enforce in the courthouse that was built to enforce rights is not much of a right. The Fifth Amendment says private property shall not be taken for public use without just compensation. For 34 years, the Supreme Court's own procedural rule made that promise harder to collect on than almost any other guarantee in the Bill of Rights. In 2019 the Court, by a vote of five to four, said that was a mistake and fixed it.

The farm, the graves and the ordinance

Rose Mary Knick owns 90 acres in Scott Township, Pennsylvania, near Scranton, where she keeps horses and other farm animals. On the land is a small family graveyard. Private burial plots on private land are an old American tradition, and nobody had made a federal case of it.

In 2012 the township passed an ordinance requiring that cemeteries, defined broadly enough to reach any land where human remains were buried, be kept open and accessible to the public during daylight hours. The ordinance also authorized the township's code enforcement officer to enter property to find out whether a cemetery was present. Her complaint was simple. A rule that forces you to open your land to the public every day is not a mere regulation of how you use your land. It takes from you the most basic right an owner has, the right to exclude. A government that wants a public right of way across your land can buy one, or it can condemn it and pay. What it may not do is declare the right of way by ordinance and send the bill to nobody.

In 2013 a township officer found grave markers on her land and notified her that she was in violation. She went to state court seeking a declaration that the ordinance was a taking and an injunction against enforcing it. The township then withdrew its notice of violation and agreed to hold off enforcement, and the state court declined to rule on her request because, with no enforcement action pending, she could not show the harm that equitable relief requires. She had a claim; she was told it was not ripe. So she went to federal court under Section 1983 of the Civil Rights Act of 1871, the statute that lets a person sue state and local officials in federal court for violating the Constitution.

The federal courts turned her away too. The Third Circuit said, in effect, that her claim might well be good on the merits, but that under the Supreme Court's decision in Williamson County she could not bring it in federal court until she had first gone to state court and been denied compensation there. She had tried state court. State court had sent her away. The rule had produced a loop with no exit.

What Williamson County actually said

To see how a rule like that survives for three decades, you have to read the case that created it. Williamson County Regional Planning Commission v. Hamilton Bank of Johnson City, decided in 1985, involved a bank, which had come into a Tennessee subdivision development through foreclosure, and whose proposed plat the county planning commission had rejected. The bank sued in federal court under Section 1983, claiming a regulatory taking.

The Court said the claim was premature, and it gave two reasons. The first was about finality. A takings claim against a regulation does not exist until the government has made a final decision about how the regulation applies to the land. In that case the bank had never applied for the variances that could have resolved some of the commission's objections. That requirement is sensible and it survived Knick, which did not touch it.

The second reason is the one that mattered. The Court said that a property owner has not suffered a violation of the Takings Clause until the owner has used the available state procedures to seek just compensation and been denied. The logic went like this: the Fifth Amendment does not forbid takings, it forbids takings without just compensation; if the state provides a way to get compensation, then no violation has occurred until the state refuses to pay.

That reasoning sounds tidy. It also has a trapdoor, and the trapdoor opened in 2005 in San Remo Hotel v. City and County of San Francisco. The hotel owners did what Williamson County told them to do: they went to state court first. They lost there. Then they went to federal court, and the Supreme Court held that the state court's judgment barred them under ordinary rules of preclusion, the doctrine that says you cannot litigate again what you already litigated. Put the two rules together and the result is almost comic, the sort of thing a satirist would reject as too on the nose. A bureaucracy that designed it on purpose would be accused of cruelty; one that stumbled into it gets called "settled law." The landowner must go to state court first. If he loses there, he is bound by the loss. He may then proceed to federal court, where he will be told he already lost. Federal court was a place a takings claimant could visit only until he arrived.

Why the Takings Clause got stuck in the hallway

Consider how other rights work. A person who claims police searched his house without a warrant may sue under Section 1983 in federal court. A person who says a town banned his church sign may sue in federal court. Nobody tells him to exhaust state remedies first, because the Court has said since Monroe v. Pape in 1961 that Section 1983 gives a federal remedy that does not depend on state remedies.

Only one right in the Bill of Rights had to stand in line at the state courthouse first. That was property. The Chief Justice's opinion in Knick said the state-litigation requirement relegated the Takings Clause to the status of a poor relation among the Bill of Rights guarantees, borrowing a phrase from an earlier case, and that is about right. Property owners were held to a gate that nobody else had to pass through. Imagine telling a newspaper that it must first lose a free-speech case in a state court before it is allowed to mention the First Amendment to a federal judge. The editorial pages would be set in a type size normally reserved for declarations of war.

There is a practical reason this matters beyond the symbolism. State courts, in many places, are friendlier to the local government than a federal court would be, and they are applying state law to a federal question. A local official who knows that the owner must start in state court, and that a loss there will probably end the case, has less to fear from taking first and arguing later.

The Court's answer: a taking is complete when it happens

Knick reached the Court on one question, framed by the petition: should Williamson County's state-litigation requirement be overruled? Chief Justice Roberts wrote for a five-justice majority, joined by Justices Thomas, Alito, Gorsuch and Kavanaugh. The holding can be stated in one sentence. A property owner has a claim under the Fifth Amendment as soon as the government takes the property without paying for it, and the owner may bring that claim under Section 1983 in federal court at that moment.

The reasoning is worth following in order.

1. The text. The Fifth Amendment says private property shall not be taken for public use without just compensation. The Court read that to mean that a taking without payment at the time of the taking is itself the violation. The Constitution does not say "unless a remedy exists later."
2. The history. The government's later offer to pay, the Court said, does not erase the earlier wrong any more than a thief's later offer to return what he took erases the theft. The remedy the owner seeks is for the period of the taking and the loss of use.
3. The state-litigation rule was wrong on its own terms. Under Williamson County, a federal claim was treated as nonexistent while the owner pursued a state remedy, and then as already litigated once he had. The Chief Justice's opinion treated the requirement as a rule in search of a justification that turned a federal right into a state-court right.
4. No other right works this way. The Court saw no reason to give property a lesser rank than speech or search and seizure.

The Chief Justice also answered the government's chief practical worry, which is that governments will be exposed to damages claims for every regulation. He said that governments need not fear federal courts invalidating their regulations, because an injunction is ordinarily unavailable when a compensation remedy exists after the taking, and an owner who is paid promptly has no unpaid taking to sue over. The change is in who must go first. Under Williamson County the owner had to chase the government. After Knick the government has the incentive to pay promptly or to avoid the taking.

The strongest case for the other side

A fair reading of the dissent starts from a premise any lawyer would respect. Justice Kagan, joined by Justices Ginsburg, Breyer and Sotomayor, wrote that the majority was throwing over a long-settled rule with no good reason. Stare decisis, the principle that the Court should follow its own precedent, protects the stability of the law. Williamson County had been on the books for 34 years. Lower courts, governments and landowners had all built their practices around it.

The dissent also made a structural argument that deserves a fair statement. The Fifth Amendment, she wrote, allows takings; what it forbids is taking without compensation, and so a government that offers an adequate path to payment has not violated the Constitution. On that account, the owner who sues the day after a taking has not yet suffered an uncompensated taking, because the government has not yet had a chance to pay. The dissent warned that the new rule would send local land-use disputes to federal courts that are not equipped for them, and would let federal judges second-guess the zoning decisions of town councils.

That is a serious argument and it is made by serious judges. Here is why it does not survive.

One: the stare decisis point cuts against the dissent. The Court has overruled precedent when the rule was badly reasoned, unworkable, and inconsistent with other cases. Williamson County was all three. Its second requirement was thinly argued, it was in conflict with a long line of cases in which the Court had treated an uncompensated taking as an immediate violation, and San Remo showed it could not be applied without making the federal courts a mirage. Reliance interests are weak when the "reliance" is the government's reliance on being able to avoid paying.

Two: the dissent's reading puts compensation above the taking. If the Constitution is satisfied whenever some court might eventually order payment, then the promise is one the government can keep or break at its pleasure. The Court has long held that the right to compensation arises at the time of the taking. The property owner whose land is occupied for a decade does not get the decade back.

Three: the federal courts are the ordinary forum for Section 1983. Congress put this remedy in federal court in 1871 because it did not trust local courts to enforce the Reconstruction amendments against local officials. Property owners standing on the Fourteenth Amendment, which carries the Takings Clause against the states and cities, are standing on that same ground.

Four: the worry about federal courts being flooded has not come true in the way predicted. The ripeness requirement of finality is still alive. A landowner must still show that the government has made a final decision. What went away was the extra requirement to detour through state compensation procedures first.

What it means for a landowner

None of this should be read as legal advice for a particular parcel; that takes a lawyer who knows your state and your facts. What the decision changes is the map, and the map is worth knowing.

• Where to sue. An owner who believes a regulation or an official's action amounts to a taking by a state or local government may bring a Section 1983 claim in federal court without first exhausting state compensation procedures. The owner may still choose state court, but the choice belongs to the owner and is no longer forced.
• What must still be shown. The finality rule from Williamson County is intact, so the government must have made a definitive decision about what can be done with the land. The owner still has to prove a taking, which is a different and harder question than getting into court. Ordinary rules on physical occupations, on regulations that wipe out all economic use of the land, and on the balancing test from Penn Central remain the law.
• Who is on the hook. The government that took the property, and not an individual official, is where the claim runs.
• The federal government is different. A claim against the United States for a taking is brought in the Court of Federal Claims under the Tucker Act. Knick was about state and local governments and Section 1983.

The decision connects to a larger recovery of property rights in the Court's recent work. In Tyler v. Hennepin County, the Court held that a county that kept the whole value of a home sold for a small tax debt took more than it was owed; that story is told in A 94-Year-Old Lost Her Condo Over a Tax Debt and the Court Said Enough. The older ground, the original meaning of "public use" and what compensation must cover, is covered in The Takings Clause Explained, From Public Use to Just Compensation, and the Michigan reversal of the infamous Poletown condemnation is in Detroit Bulldozed Poletown for a Car Plant and Michigan Took 23 Years to Repent.

The Founding view of property, and why it settles the matter

The Founders did not treat property as a second-tier right. James Madison, who drafted the Takings Clause, wrote in 1792 that government is instituted to protect property of every sort, and that a government which fails to do so is not a just one. John Locke, whom the Founders read the way their grandchildren read the newspaper, argued that the preservation of property is among the chief ends of government. The idea that a person may be dispossessed first and argue about payment later would have struck them as an inversion of the order of things. The reading of Madison's argument that property includes opinions and conscience as well as land is explored in Madison Wrote That Government Exists to Protect Property of Every Sort, and the labor theory behind it is in Locke Said Property Begins the Moment Your Labor Mixes With the Earth.

There is a humbler lesson too. Rules that look procedural are often where rights live or die. Nobody in 1985 thought Williamson County repealed a clause of the Fifth Amendment. It said only that a claim was early. But a right that is always too early to enforce and, once enforced elsewhere, too late to enforce here, is a right on a leash. The Court in Knick did what courts sometimes do best: it looked at the effect of a rule and decided that the rule had to go.

Here is the part the coverage rarely stresses. The possibility of a federal lawsuit concentrates the municipal mind in a way that a state-court detour never did. If you want a one-line summary of the economics, it is this: the price of a taking should be paid by the party doing the taking, and a government that can force you to chase it through the wrong courthouse first is not paying the price. It is billing you for the privilege of finding out where to send the bill. The motor vehicle office at least has the decency to hand you a number.

What the case does not do

Honesty requires a few limits. Knick does not say that every regulation is a taking, and it does not give owners a damages claim against every unwelcome zoning decision. The law of regulatory takings is a hard body of law, with the threshold set high on purpose. The case does not overrule the finality requirement. It does not address federal takings, which have their own track. And it does not turn the federal bench into a zoning board; a judge who finds no taking will say so, and the owner will have lost on the merits instead of being turned away at the door.

What it does is restore a simple order of events. The government acts. If the act is a taking, the owner may go to a federal court and say so. If the government does not want to be sued, it may pay. That is the arrangement the text suggests, and it is the one the Founders would have expected.

The case in brief

1. The Fifth Amendment bars the taking of private property for public use without just compensation, and for 34 years Williamson County made owners litigate in state court before they could bring that federal claim to a federal one.
2. San Remo showed the trap: an owner who followed the rule and lost in state court was then barred from federal court, so the federal forum existed on paper only.
3. In Knick, decided June 21, 2019, a 5-to-4 Court held that a taking without payment is a violation when it happens and may be brought under Section 1983 in federal court right away.
4. The dissent's stare decisis and federalism arguments deserve respect, and they fail because the old rule was badly reasoned, unworkable and unlike how every other right in the Bill of Rights is treated.
5. The finality requirement survives, the owner must still prove a taking, and a government that pays promptly leaves nothing to sue over; what changed is who has to go first.

What you can do: read the Fifth Amendment's takings clause in the Constitution, then look up your own county's or city's procedure for compensation when land is taken, so you know the process before you ever need it.