Euclid was a suburb of Cleveland. They instituted a
zoning ordinance. Ambler sued Euclid on the basis that the zoning
ordinance interfered with the value of their properties.
Under Euclid's zoning laws, the heights of buildings to
be built on Ambler's land was limited, thereby reducing the potential
value of the land.
Ambler argued that the zoning law was a violation of the 14th
Amendment.
The zoning law deprived Ambler of liberty and property
without due process.
Ambler further argued that even if the concept of zoning
was legal, it still constituted a taking, and Euclid would have to
compensate Ambler for the loss.
The realty industry was generally against the concept of
zoning and decided to test the constitutionality of zoning laws by suing Euclid.
The Trial Court found for Ambler. Euclid appealed.
Finding that the zoning ordinance did in fact constitute
a taking by Euclid of Ambler's property, the Trial Court stated
that the ordinance was unconstitutional.
Euclid argued that zoning is a form of nuisance control
and therefore a reasonable police power measure.
The US Supreme Court overturned the judgment, and found
the zoning law to be constitutional.
The Supreme Court found that the zoning ordinance was not
an unreasonable extension of the Euclid's police power and did not have
the character of arbitrary fiat, and thus it was not unconstitutional.
The Supreme Court also found that Ambler had failed to
prove that the land would lose value. Ambler was only speculating, which
is not a valid basis for a claim of takings.
The Supreme Court caveated their decision by saying that
while zoning laws were constitutional in general, there could be specific
applications or provisions of zoning laws which could be
unconstitutional.
The Supreme Court found that in order for a jurisdiction
to take land without violating due process, the taking must meet
two tests:
There must be a legitimate end goal, such as the
increase of the general welfare or public health.
There are many reasons why Euclid can meet this
standard, including pollution control, firefighting, population density
control, and ensuring that residential neighborhoods will not disappear
because the land is more valuable as industrial space.
Plus, it keeps the immigrants out of the nice
neighborhoods...
It also must use means that are not capricious or
irrational.
The 5th Amendment says that the
government cannot take someone's property without compensating the owner.
So why is it ok for the government to reduce the value of property by
placing zoning restrictions on it?
See Pennsylvania Coal Co. v. Mahon
Rich conservatives loved this decision, even though they
are generally against government regulation. In this case though, it
ensured the value of their expensive property because they could now use
zoning laws to keep 'undesirables' away from their land.
Overall, if you look at the case law, zoning regulations
almost never trigger the need for compensation as a taking.
