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Palm Beach Isles Assocs. v. United States

Citation: 30 ELR 20481
No. No. 99-5030, 208 F.3d 1374/(Fed. Cir., 03/31/2000)

The court holds that summary judgment was improvidently granted in favor of the U.S. Army Corps of Engineers in a suit brought by property owners who claimed that the Corps' refusal to grant the owners a Clean Water Act (CWA) § 404 dredge and fill permit for 50 acres of submerged lands constituted a taking. The court first holds the relevant parcel subject to a taking is the 50.7 acres that the property owners currently plan to develop. The lower court held that the relevant parcel was the 311.7 acres of land that the property owners originally purchased in 1956 and that they divided in 1968 when they sold 261 acres to a developer. However, the property owners never planned to develop the parcels as a single unit, and the purchase of the land and the sale of the 261-acre parcel both occurred before enactment of the CWA in 1972. Likewise, the development plans for the 50.7 acres was unrelated to the development plans and disposition of the 261 acres. Thus, combining the two tracts for the purpose of the regulatory takings analysis involved here simply because at one time they were under common ownership or because the tracts sold for a substantial price cannot be justified. Therefore, the court next holds that the Corps' denial of the permit resulted in a categorical taking of the property. Once the proper parcel is defined as the 50.7 acres, it becomes clear that without the permit the 50.7 acres have no or minimal value.

The court then holds that the 50.7-acre parcel is subject to the navigational servitude because the entire parcel lies below the high watermark of a lake that is part of the navigable waters of the United states. Further, the court notes that the navigational servitude is a preexisting limitation on the landowner's title and, thus, may provide the Corps with a defense to a takings claim. In order to avoid paying compensation, however, the Corps must demonstrate that the permit denial was related to navigation. The court then holds that it is unable to determine whether the government has made a sufficient showing of a navigational purpose behind the permit denial. Thus, the case is remanded for development of this issue.

Counsel for Plaintiffs
Luther M. Taylor
Law Offices of Luther M. Taylor
11911 N. Federal Hwy., N. Palm Beach FL 33408
(561) 626-0909

Counsel for Defendant
Ethan G. Shenkman
Environment and Natural Resources Division
U.S. Department of Justice, Washington DC 20530
(202) 514-2000

Before Lourie and Clevenger, JJ.