- Failure to exhaust state court remedies is no longer a bar to filing a federal Fifth Amendment claim.
- Section 1983 claims may be brought as soon as an unconstitutional taking occurs.
Property owners may now file a federal claim for a constitutional violation of property rights as soon as a government takes private property for public use without paying for it. On June 21, 2019, the Supreme Court of the United States reconsidered the issue of whether property owners have standing to bring Fifth Amendment §1983 claims in federal court at the time of a taking or must first exhaust their remedies in state court. In Knick v. Township of Scott, Pennsylvania, et al., the Court overturned a decades-old exhaustion-of-state-litigation requirement and held that when a government violates the Takings Clause, a property owner has immediate standing to bring a §1983 action in federal court, even if the issue of just compensation has not been addressed by the state courts.
Under the old rule set forth in Williamson County Regional Planning Comm’n v. Hamilton Bank of Johnson City, which controlled the issue for approximately 35 years, when a government took a property owner’s land, the property owner could not pursue an action in federal court until its property had been taken and it had exhausted all of its remedies to pursue just compensation in state court proceedings. However, in practice, a state court’s resolution of a claim for just compensation under state law precludes any subsequent federal suits under the full faith and credit statute, as the Court recognized in San Remo Hotel, L.P. v. City and County of San Francisco, 545 U.S. 323 (2005). The Knick court concluded that the state-litigation requirement under Williamson and the subsequent preclusion trap recognized in San Remo Hotel imposed an impermissible burden on plaintiffs seeking to vindicate their rights under the Takings Clause and subjected them to hurdles not faced by plaintiffs seeking redress under other constitutional protections through §1983 litigation.
What does this mean for property owners going forward? The Knick decision restores the Fifth Amendment property rights to the same level of protection as other constitutional claims, which can be enforced in federal court as soon as an unconstitutional violation occurs. Under the previous Williamson framework, property owners affected by takings without just compensation provided in advance were forced to exhaust state court remedies – often in the form of procedurally complex inverse condemnation actions, essentially forcing condemning authorities to initiate formal proceedings – and then live with the results of any just compensation resolution in state court proceedings. Now, under Knick, property owners facing condemning authorities that are reluctant to come forward with a just compensation package or to initiate proper condemnation proceedings have an immediate right to seek redress in federal court from the moment the taking occurs.