A Florida company was awarded nearly $7 million by the U.S. Court of Federal Claims on March 14 in a long-running case involving a claimed unconstitutional taking of property arising from the denial of a Clean Air Act Section 404 wetlands fill permit. The critical issue underlying the court’s ruling, as is often the case in “regulatory takings” cases seeking just compensation for the denial of property rights, was the proper definition of the property parcel that was taken.  This issue is often called the “parcel-as-a-whole” doctrine. Developers and others whose businesses require permits of various types should be familiar with this doctrine.

The trial court initially found no taking, concluding that the denied permit was for a parcel that was merely a part of a much larger relevant tract.  Thus, the permit denial only impaired the value of the larger tract, which is not a taking. The appeals court reversed, holding that the relevant parcel for takings purposes was just the parcel for which the permit was denied.  That ruling led the trial court on remand to find that the permit denial completely eliminated the value of the relevant parcel, which is a taking and entitled the property owner to substantial compensation (as well as attorneys’ fees).