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  • Cited by 1
  • Print publication year: 2011
  • Online publication date: June 2012

5 - Regulatory Takings


The general rule at least is that while property may be regulated to a certain extent, if regulation goes too far it will be recognized as a taking.

Oliver Wendell Holmes, Jr. (Majority opinion, Pennsylvania Coal v. Mahon, 1922)

Every restriction upon the use of property imposed in the exercise of police power deprives the owner of some right theretofore enjoyed…. But restriction imposed to protect the public health, safety or morals from dangers threatened is not a taking.

Louis Brandeis (Dissenting opinion, Pennsylvania Coal v. Mahon, 1922)

To this point in the book, our discussion of eminent domain has focused primarily on government acquisitions, or condemnations, of property. Much more common, however, are government regulations that restrict the use of property without actually seizing title to it. Examples include zoning, environmental and safety regulations, historic landmark designation, rules requiring equal accommodation for the disabled, and so on. I have also emphasized, however, that from an economic perspective, regulations that reduce the value of private property are not fundamentally different from outright takings; the difference is one of degree rather than of kind. This is true because neither economists nor lawyers view property as a single entity, but rather as a bundle of rights or entitlements, each of which has some value. Thus, any deprivation or restriction of a particular right reduces the value of the property proportionately. A physical taking, which deprives the owner of all rights, is simply one end of a continuum.