The dispute over the validity of the St. Croix County zoning ordinance at issue in Murr really depends on how you define the petitioners’ property. (For an overview of the facts of this case, click here.) If, like the petitioners, you believe that Lots E and F are separate properties and must be considered as such, then there is a stronger argument that the zoning laws result in a taking. If, like the County and the State, you believe that the St. Croix County ordinance effectively merged the two lots into a single property once they came under common ownership, then there probably is no taking, because the petitioners have several options for uses of the property that would conform to the zoning laws.

A regulation is often more onerous when applied to a smaller parcel than to a larger parcel. For that reason, land owners alleging a taking generally seek to define the affected property in the narrowest possible terms, while regulators generally seek to define the property as broadly as possible. In takings law, the definition of the property subject to the challenged regulation is known as the “denominator question.” Here, the petitioners insist that the Wisconsin Court of Appeals erroneously understood the Constitution to require considering Lots E and F together as the denominator. The County and the State (as well as the federal government) disagree with that contention, though they offer different reasons for their conclusions.

The petitioners’ argument

The petitioners assert that Lots E and F are two separate parcels of land. They rely on Penn Central Transportation Co. v. New York City, 438 U.S. 104 (1978), to support the argument that their adjacent properties cannot be considered as one. In that case, the owner of Grand Central Terminal claimed to have suffered a regulatory taking when New York City cited its Landmarks Preservation Law in denying the owner’s application to build an office tower above Grand Central. Specifically the company claimed its air rights had been taken without compensation. The U.S. Supreme Court held there was not a taking. The Court explained that, because takings law does not provide for dividing a single parcel into segments, the air rights should not be considered separate from the rest of the property for the takings analysis.

The petitioners read Penn Central as supporting their position. They see it as rejecting the idea that a single property can be divided into separate subdivisions with the aim of showing that one piece had been taken. But they also see it as a narrow ruling that does not allow—much less require—the aggregation of commonly owned parcels for a takings analysis. They note that, although the New York state courts evaluating the takings claim in Penn Central had considered income from other nearby properties also owned by the same developer who owned Grand Central Terminal, the U.S. Supreme Court did not adopt that reasoning. As a result, the petitioners cite Penn Central for the proposition that property neither be segmented nor aggregated in determining the denominator for a takings analysis; rather, the property must be viewed on its own terms. In this case, they see those terms as the metes and bounds that define Lot E as separate a property from Lot F.

The petitioners argue that their parents’ expectations when they purchased Lots E and F further support treating the lots as separate properties for the takings analysis. Their expectations that the two lots were distinct properties and that they had ownership rights—including the rights to possess, exclude, to use, and to convey—over each property were reasonable because the government created and approved the lots as separate parcels.

The State of Wisconsin’s argument

The State argues the petitioners’ property is one unified whole. To support this conclusion, it relies on Lucas v. South Carolina Coastal Council, 505 U.S. 1003 (1992). Lucas says that, in identifying the relevant denominator for a takings analysis, a court should consider how state law shaped the land owner’s reasonable expectations. The State argues that applying Lucas respects each state’s authority over the division of land within its borders and that relying on state law leads to greater predictability in the results of takings litigation. The State suggests that courts should avoid looking to case-specific and subjective factors to determine the relevant parcel, because doing so will lead to less-predictable outcomes.

The State therefore frames the question in Murr this way: how have Wisconsin’s laws and regulations shaped the petitioners’ reasonable expectations regarding their land? In response, the State argues that, under Lucas, the petitioners’ claim that Lots E and F are separate parcels is unreasonable in light of Wisconsin law. To support that conclusion, the State points to the St. Croix County zoning ordinance that merges contiguous, substandard properties under common ownership; a similar regulation promulgated by the Wisconsin Department of Natural Resources; and the Wisconsin Supreme Court’s ruling in Zealy v. City of Waukesha, 201 Wis. 2d 365, 548 N.W.2d 528 (1996).

St. Croix County’s argument

Like the State, St. Croix County argues the petitioners’ property is one parcel, not two. The County focuses on the issue of valuation, arguing that the Wisconsin Court of Appeals correctly considered the value of Lots E and F as one combined property with a residence, rather than the hypothetical value of Lots E and F separately with a residence on each lot. The County explains that state law defines property interests and that lot lines are not themselves controlling. It notes that the lot lines for the petitioners’ property were not permanent, but had changed several times since they were initially drawn in 1959. The County contends the Court should consider several factors—of which lot lines should be only one—when determining the relevant parcel, including ownership history, unity of use, and government treatment of the land. The County urges the Court to ignore the owner’s subjective desires for use of the property.

The County defends its zoning ordinance (and the state regulation underlying it) that treats contiguous, substandard properties under common ownership as merged by noting that many other states have similar regulations, which are “longstanding and widespread.” The County explains that isolated lots that are nonconforming to zoning ordinances are usually granted variances. However, if nonconforming lots are adjacent and have common ownership, the lots are combined and denied the variance in order to meet the zoning under the code (or become closer to meeting it). The County contends that such laws are important for striking a balance between achieving zoning goals and maintaining land uses that were allowed when the land owner purchased the property. The County notes the prevalence of such merger laws shape land owner’s reasonable expectations, as well as other factors.

Solicitor General’s amicus brief

The Solicitor General of the United States, who is the nation’s chief legal advocate, filed an amicus brief in support of the State and the County. In that brief, the United States government agrees with both the State and the County’s conclusion that the lots are one parcel, but it reaches that conclusion for different reasons.

The government explains that state lot lines do not establish the relevant parcel. Spatial, functional, and temporal considerations establish that Lots E and F are one property. The lots are contiguous, have common ownership, were acquired closely in time, and share the same topography. The Wisconsin regulation merging substandard lots in the area provides an additional reason to consider the two lots as one. On this basis, the government joins the State and the County in urging the Supreme Court to affirm the Wisconsin Court of Appeals decision.

The Solicitor General has also filed a motion asking the Supreme Court to grant the federal government some time at oral argument to advocate for its position.

The petitioners have an opportunity to respond to the State, the County, and the federal government’s arguments in their reply brief, which is due by July 29.

Our main, introductory post on Murr v. Wisconsin can be found here.

Law clerk Olivia Pietrantoni assisted in researching and writing this post.

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