Real Estate & Property Law

New SCOTUS Cert Petition From Kauai: Is Surrender Clause In State Lease A Taking?

By Robert Thomas (inversecondemnation.com)

Recently, the owners of vacation cabins located on leased land in a state park on the island of Kauai filed a cert petition which asks the U.S. Supreme Court to review an unpublished decision of the Hawaii Intermediate Court of Appeals which held that the State did not run afoul of the Takings Clause when it required the owners to surrender their cabins at the end of the lease.

The trial court determined that the lessees had no property interest when their leases expired. The Hawaii Supreme Court declined review of the ICA's disposition.

The lessees' petition is available here, and presents the following question:

QUESTION PRESENTED

The State of Hawaii owns land in Kokee State Park on the island of Kauai. Petitioners, have leasehold estates in parcels on the land and own private cabins thereon. Each Petitioner, or his or her predecessor in interest, bought, built or inherited his or her private cabin. Collectively, the cabins are worth several million dollars. In 1985 when the prior land leases expired, the State required Petitioners, as a condition of retaining their leasehold interests in the land to sign 20-year land leases containing a clause whereby Petitioners would be required to surrender their pre-existing residence cabins to the State in 2006, when the 1985 lease expired -- and receive no compensation in return.

Question Presented

Whether a state may escape its constitutional obligation to pay just compensation for the taking of a citizen's pre-existing private property, by requiring the un-compensated surrender of the citizen's private property as a contract term in a land lease, where the lease contains no knowing, voluntary, clear or intelligent waiver of the constitutional right to just compensation -- and where the state would have taken the same private property without just compensation if the lease was not signed, as drafted by the State.

Petition at i-ii (emphasis original).

Full post as published by inversecondemnation on January 20, 2010 (boomark / email).