Posted by: Patricia Salkin | February 8, 2011

7th Circuit Holds that Denial of Request to Remove Conditions of Previous Re-Zoning Did Not Constitute a Taking

Bettendorf owned property in St. Croix County, zoned agricultural-residential. In 1972, he began to operate a carpet sales and installation business. By 1974, he was also operating an excavating company and a trucking company on the property. In 1984, Bettendorf applied to the St. Croix County Planning, Zoning, and Parks Committee to re-zone the land as commercial so that he could operate a trucking terminal. The committee approved the request on condition that the commercial re-zoning was only for Bettendorf’s use and was not transferable, and this was confirmed in a 1985 ordinance. 

Bettendorf knew this conditional language restricted his ability to recoup the value of his commercial investments when he was ready to sell, and petitioned the County to make the re-zoning permanent. When the County refused, Bettendorf initiated litigation to construe the limits of the ordinance, hoping the court would remove the limitation on the re-zoning; instead, the ordinance and his special use permit were declared void, so that continued commercial use was deemed illegal. Bettendorf now argued that the County’s removal of the commercial zoning designation following the Wisconsin Court of Appeals’ decision to invalidate the ordinance constituted a taking, and that the state court proceedings and resulting decision by the County to revoke the ordinance did not provide him with adequate substantive and procedural due process protections. The district court, however, granted summary judgment in favor of the County. 

The Seventh Circuit affirmed. To establish a regulatory or “constructive” taking, the challenged government action had to deprive the landowner of “all or substantially all practical uses of the property.” The court rejected Bettendorf’s claim that the degree of interference with the landowner’s anticipated and distinct investment opportunities had not been adequately considered. Here, any improvements Bettendorf made to his property were completed with full knowledge that the commercial designation was limited and would ultimately be lost; further, he initiated the litigation, assuming the risk in asking the court to interpret the scope and validity of the ordinance. This was not a government intrusion or interference with his investment opportunities, and even now he retained full use of his property for agricultural and residential purposes. The court declined to exercise jurisdiction over any potential “vested rights” claim. 

Dealing with the due process issues – the denial of the protection of the substantive legal standards that would have applied to a change in zoning, as well as the deprivation of his right to a public hearing and consideration by the appropriate municipal decision-makers – the court found the claims without merit. First, the County’s decision to revoke the commercial designation could “hardly be considered conscious-shocking or arbitrary,” as it was done in response to a judgment and court order; thus, no substantive due process violation resulted.  Second, Bettendorf was afforded adequate process in the state court system and no procedural due process violation occurred. “The fact that he bypassed an appeals process which he now suggests must be followed as a matter of constitutional fairness seriously undermines his argument that the state court process was deficient.”

Bettendorf v. St. Croix County, 2011 WL 167030 (7th Cir. 1/20/2011). 

The opinion can be accessed at: http://www.ca7.uscourts.gov/tmp/581BOQDF.pdf 

This summary appears in the February 2, 2011 Issue of the IMLA E-News.  For more information about IMLA visit www.imla.org


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