Freeman

ARTICLE

Private Property Ownership

Government Power Diminishes Our Private Property Rights

JANUARY 01, 1995 by AL BELLERUE

Filed Under : Property Rights, Private Property, U.S. Constitution

Mr. Bellerue is a real property analyst specializing in eminent domain.

According to the Fifth Amendment to the U.S. Constitution, no person shall be “deprived of life, liberty or property, without due process of law; nor shall private property be taken for public use without just compensation.” This clause, known as the eminent domain reservation, gives the state the legal right to take private property for public use without the consent of the owner. But, the owner has a right to his day in court to insure “just compensation.”

The Fourteenth Amendment states that no state shall “deprive any person of life, liberty, or property, without due process of law; nor deny to any person within its jurisdiction the equal protection of the laws.” This simply extends legal property protection from all of the amendments in the Bill of Rights down to local government protection of private property ownership.

But just what is private property ownership? Property is anything subject to ownership and private relates basically to an individual. Ownership relates to a possessory interest in a property. This is the right to exert control over the uses of property to the exclusion of others.

The Bundle of Rights

In real estate, the ownership-rights theory is compared to a bundle of sticks wherein each stick represents a separate right-to-use. For example, a property owner can sell his mineral rights usage to one person and lease his surface rights to another. Likewise, an aerial or scenic easement can be granted wherein the underlying rights of use may be retained. But, each time a use is granted away, the bundle of rights shrinks.

Government power further reduces the number of sticks in the bundle of rights through taxation, escheat, eminent domain, and police power.

In matters of taxation, the federal government is precluded from direct taxation of real property. This right of taxation is reserved to state and local governments. But local encroachment also removes a number of sticks from the ownership bundle.

Escheat deals with the state taking over ownership of property if the property owner dies without a will.

As previously explained, eminent domain limitations set out in the Fifth and Fourteenth Amendments at the very least prohibit government expropriation without payment for the taking.

Police power relates to government regulation of property in accordance with that ambiguous term “general welfare.” Examples of major government intrusions into the right to private property ownership are planning and zoning ordinances; building codes; air and land traffic regulations; and health, safety, and sanitary regulations. Some of these make sense; others are downright damaging to the right to life, liberty, and property ownership.

It is in this latter group of police powers assumed by political government that private property ownership rights are being ignored. More and more sticks have been expropriated from the bundle by regulation or negation of proprietary uses. Such damaging political action often reduces the owner’s property value without just compensation. The proper term for that is “extortion.”

If there is any question about the act of protecting and maintaining rights rather than property per se, a statement by U.S. Supreme Court Justice George Sutherland should provide clarification: “It is not the right of property which is protected, but the right to property. Property, per se, has no rights; but the individual, the man, has three great rights, equally sacred from arbitrary interference: the right to his life, the right to his liberty, the right to his property. . . . The three rights are so bound together as to be essentially one right. To give a man his life but deny him his liberty is to take from him all that makes his life worth living. To give him liberty but to take from him the property which is the fruit and badge of his liberty, is to still leave him a slave.”

Legal Plunder—The Law Perverted

Morality, or proprietary relations between people, cannot exist without a basic understanding of the birthrights of everyone to life, liberty, and property. Basically, human rights are nothing more than property rights.

Currently, throughout the world, nation after nation is in chaos because of trespass upon human property rights.

The United States is no exception. Increasingly, our people are at odds with political governments because of disregard for these rights. Yet, recognition of participation in these trespasses should first be placed at the doorstep of the people who unconscionably take part in this legal plunder.

The City of Mesa, Arizona, recently refused to grant a permit for a residential subdivision located two miles distant from Williams Airport. The basic reason given was that noise from the aircraft would annoy future residents. An aerial easement which would have offset future liability was never suggested.

No mention was made of the fact that the hundreds of existing Capehart Homes on the old Air Force base remain occupied. The emphasis was placed upon the City Planning and Zoning projections calling for industrial usage to surround Mesa’s newly-to-be-acquired airport.

No exceptions were to be made in spite of the fact that there is no present demand for industrial usage in the surrounding agricultural area. Nor is there any assurance that the federal property will be transferred soon because of Indian claims to some of the property. It may be years before industrial demand surfaces.

The original sticks existing in this owner’s bundle of rights that gave him a prior right to use his property for residential subdivision have been taken from him by city police power with no just compensation.

The only legal use remaining to him now is industrial, the likely market demand for which he may never see in his lifetime. Through police power of local government regulation, this octogenarian’s retirement nest egg has been legally plundered.

No longer do local governments use eminent domain’s Fifth Amendment where they must compensate the owner for partial loss in property value. Instead, they fall back upon police power through planning and zoning regulation. This permits them to take property without compensation: legal plunder! The bundle of ownership rights to private property keeps shrinking.

Frederic Bastiat (1801-1850), a French economist-statesman, brilliantly and presciently described this encroachment by government: “The law perverted! And the police powers of the state perverted along with it! The law, I say, not only turned from its proper purpose but made to follow an entirely contrary purpose! The law became the weapon of every kind of greed! Instead of checking crime, the law itself guilty of the evils it is supposed to punish!”

City and county planners and zoners in Arizona have become tyrannical in their unconstitutional takings because judicial decisions have favored local government trespasses upon private property ownership for nearly half a century.

Local officials continue to manipulate the legal use of real property for maximum political benefit to themselves, at the expense of the owners of private property.

Supreme Court Takes Favorable Stand

Hopefully, the tide may be changing. After many years of wishy-wash, the U.S. Supreme Court has finally come out with a ruling in favor of private property rights. On June 14, 1994, the importance of individual property ownership was revived in a decision in Dolan vs. City of Tigard, Oregon.

The court ruled in favor of the petitioner, Florence Dolan, saying that land-use regulations cannot be based upon the political theory that desirable ends justify any means to restrict the freedom of the property owner. Mrs. Dolan had proposed replacement of her 9,700 square-foot plumbing-supply store with a much larger commercial building on her 1.67 acre lot. But in order to obtain a permit the city of Tigard required her to donate 10 percent of her property to the city for the City Drainage Plan in order “that it be preserved as greenways to minimize flood damage.”

While the Oregon courts had ruled against Mrs. Dolan, in favor of the local government taking, the U.S. Supreme Court reversed these rulings. Chief Justice William Rehnquist wrote: “We see no reason why the takings clause of the Fifth Amendment, as much a part of the Bill of Rights as the First Amendment or Fourth Amendment, should be relegated to the status of a poor relation.” His reference related to the questionable practice of local governments using planning and zoning regulation to take private property without “just compensation.”

The decision also stated that the local government did not show a “rough proportionality” between the effects of the proposed development and the proposed government uncompensated taking. Henceforth the burden of proof will fall directly upon the local government rather than the property owner.

There is much more in Rehnquist’s Writ of Certiorari than just items relating to abuses by the City of Tigard. Many of the supporting cases bring to mind comparable land-use regulation abuses throughout Arizona.

Richard A. Epstein was the lawyer who won the Dolan decision. In his book Takings, which explores private property and the power of eminent domain, he states: “The sole function of police power is to protect individual liberty and private property against all manifestations of force and fraud.”

Since government land use regulation is police power and since many Arizona planning and zoning enforcements smack of force and fraud, who is to protect individual liberty? Most property owners can’t afford to fight city hall and city and county attorneys are more interested in politics.

Perhaps this question provides the answer to why the Phoenix Gazette took an editorial position in support of Proposition 300, the state regulatory takings bill wherein the office of the Arizona Attorney General would review a “taking’s impact analysis” of all proposed takings. (The proposition was defeated in the November 8 election.)

This sounds like a good proposal, provided that the Attorney General’s Office also reviews questionable local planning and zoning regulations that might be in violation of the Fifth Amendment.

Since the concept of private property ownership provides the basis for morality, maybe Dolan vs. City of Tigard will help us recover some of the sticks in the bundle of rights that we keep losing. It may, in the long run, help to reduce crime—both legal and illegal varieties.

ASSOCIATED ISSUE

January 1995

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