Gas Drilling : Inverse Condemnation : Private vs. Public Interests


EDITORIAL

Imagine a Neandrathal  stumbling upon a luscious piece of trail-kill 30,000 years ago  and debating  whether to share it with his hungry tribe or  eat it  himself.

Would survival of the fittest have trumped  his community’s needs?  Or would he have recognized  that food (like water) was  a Neandrathal utility — a resource essential to  the tribe’s survival  —  its consumption regulated with the common weal in mind?   Would Neandrathal society have  concocted some system of head thumps to ensure  that  fortunate ones shared with the hungry many?

Long-enshrined in our societal  understanding of survival  are two fundamental concepts that we treat with varying importance depending on the situation.

  • “A chain is only as strong as its weakest link.”  (Our community prospers when it  fosters and defends  the rights and strengths of  its members.)
  • “Ask not what your country can do for you  — ask what you can do for your country.”   (The strength of our  community  depends on the responsible generosity of its members.)

Some of the wildest and most contentious cases in Supreme Court history have attempted to resolve conflicts between  individual rights and  the community’s expectation that its larger, more inclusive  interests will predominate.

In  the earliest days of our Republic, Eminent Domain was  recognized as a  tool  inherent to the Federal Government’s mandate to “defend and protect.”   For  the  “public good,”  soldiers were billeted in Colonial homes during the Revolution  but  seizure of  private lands for permanent use  was  onerous to most early Americans and the “public use” restriction in the Fifth Amendment’s Takings Clause was strictly interpreted as a  protection against such seizures.

As  our population grew  and technology created a more mobile citizenry,  public works demanded more land for  roads, bridges and railroads.  In more recent years and in response to a landscape crammed full of skyscrapers, derricks, residential and shopping mall sprawl,  eminent domain has been used to protect open space for public enjoyment.   (The “public good” in this instance being protected  from the narrower interests of a few developers.)

Of particular interest to us in the Delaware River Basin is the  legal concept of  “inverse condemnation” which we hear with increasing frequency from  property holders demanding  they be compensated  when  regulations prohibit gas drilling on their properties.  According to a Fifth Amendment Annotation,** “While [the Fifth Amendment]  established that government may take private property, with compensation, to promote the public interest, that interest also may be served by regulation of property use….‘The distinguishing characteristic between eminent domain and the police power is that the former involves the taking of property because of its need for the public use while [police power] involves the regulation of such property to prevent the use thereof in a manner that is detrimental to the public interest.’ 251 But regulation may deprive an owner of most or all beneficial use of his property and may destroy the values of the property for the purposes to which it is suited. 252 The older cases flatly denied the possibility of compensation for this diminution of property values, 253 but the Court in 1922 established as a general principle that ‘if regulation goes too far it will be recognized as a taking.”’ 254

Later, in a 2002 case,  (Tahoe-Sierra Preservation Council v. Tahoe Regional Planning Agency)  The U.S. Supreme Court found that, “Moratoria on all development in Lake Tahoe Basin area for a period totaling 32 months, imposed by a regional planning agency while formulating a land use plan for the area, were not per se takings of property requiring compensation under the Takings Clause.”

In a seemingly oblique but related development,  corporations attained “personhood”  when The U. S. Supreme Court stated in  Minneapolis & St. Louis Railroad Co. v. Beckwith (1889) “…corporations are persons within the meaning of the [Due Process and Equal Protection clauses of the Fourteenth Amendment]….    We admit also… that corporations can invoke the benefits of provisions of the constitution and laws which guaranty [sic] to persons the enjoyment of property, or afford to them the means for its protection, or prohibit legislation injuriously affecting it.”   (Bold added for emphasis.)

As the trend toward  condemnation of privately held lands has become more usual,  eminent domain actions have increasingly benefited “corporate  persons” in the guise of  public interests.  This trend  occasioned public outrage in 2005,  when The Court ruled in   Kelo v. New London that  privately-held  property could be  seized by a government  and handed over to  a private corporation  for the public benefit —  while said corporation stood to reap a boatload of  profits.

I would never deny just compensation to landholders whose property is seized for the public good but as I write this,  Congress has just launched  an investigation into  gas drilling practices  and their  potential harm to the environment.   Perhaps we should await its findings before deciding that those practices are either legal or in the public interest, as NYS Senator Bonacic has contended.

In that context, NYS  Senator John  Bonacic, the Northern Wayne Property  Owners’ Association (NWPOA) and energy corporations  have  begun a campaign of hostage-taking.  In an  “Alice-Down-The-Rabbit-Hole” logical warp,  they have demanded that millions of people who depend on water from the Delaware River Basin and New York City Watershed pay  landholders NOT to risk  that water supply with a toxic soup of corporate fracking fluids.

“Bizarre-o!”  as my friend Amanda might say.  Or more elegantly,  I refer you to  Cliff Westfall’s analogy of a few days ago, “What if I decided to burn down the woods on my land, claiming it was the cheapest way to clear a field, with no concern for preventing its spread to my neighbor’s house?  Of course the government could regulate that. The bottom line is this: the government may prevent you from doing things on your property when those actions would harm public welfare.”   In further explanation of Mr. Westfall’s comparison,  please understand that  fracturing fluids  used in gas drilling are injected underground,  may travel as much as 6,000 feet and their  direction is neither predictable nor controllable…like a forest fire.

It is inconceivable  that Senator Bonacic and the NWPOA  truly believe that in our current economic crisis any governmental entity (or body of taxpayers) has the means to pay the ransom.  The national unemployment rate is blowing up in our faces.  Tax revenues are plummeting.  Small businesses are dying.  Our infrastructure is crumbling and our children are moving back home and forsaking dreams of college.  In the event NWPOA or some other organization of  lessors prevails in  a lawsuit demanding compensation for the value of their  mineral rights,  every taxpayer, student and worker who does not  benefit from gas royalties will lose.  And the sure winners?  Drilling companies who stand in the background ready to reap the  profits.

Given the latest U.S. Supreme Court decision which found in Citizens United v. Federal Election Commission —  a la George Orwell’s  Animal Farm —  that some “persons”  and their lobbyists  “are more equal than others,” we should not doubt the risk faced by our water and our Republic.

And given the evolutionary demise of Neandrathal,  I can’t help but wonder if  he decided to eat the whole thing all by himself.

Urge the Delaware River Basin Commission and the US Congress  to  enact moratoria  on drilling. It’s for the “public good”  because,  as more and more people are beginning to remember,  “We cannot drink gas  nor grow our food with it.”

************************

*   “…nor shall private property be taken for public use, without just compensation.”

**In general, compensation must be paid when a restriction on the use of property is so extensive that it is tantamount to confiscation of the property.

In the Mahon case, Justice Holmes for the Court, over Justice Brandeis’ vigorous dissent, held unconstitutional a state statute prohibiting subsurface mining in regions where it presented a danger of subsidence for homeowners. The homeowners had purchased by deeds which reserved to the coal companies ownership of subsurface mining rights and which held the companies harmless for damage caused by subsurface mining operations. The statute thus gave the homeowners more than they had been able to obtain through contracting, and at the same time deprived the coal companies of the entire value of their subsurface estates. The Court observed that ”[f]or practical purposes, the right to coal consists in the right to mine,” and that the statute, by making it ”commercially impracticable to mine certain coal,” had essentially ”the same effect for constitutional purposes as appropriating or destroying it.” 255 The regulation, therefore, in precluding the companies from exercising any mining rights whatever, went ”too far.” 256 However, when presented 65 years later with a very similar restriction on coal mining, the Court upheld it in Keystone Bituminous Coal Ass’n v. DeBenedictis. 257 Unlike its precursor, the Court explained, the newer law ”does not merely involve a balancing of the private economic interests of coal companies against the private interests of the surface owners.” 258 Instead, the state had identified ”important public interests” (e.g., conservation, protection of water supplies, preservation of land values for taxation) and had broadened the law to apply regardless of whether the surface and mineral estates were in separate ownership. A second factor distinguishing Keystone from Mahon, the Court explained, was the absence of proof that the new subsidence law made it ”commercially impracticable” for the coal companies to continue mining. 259 The Court rejected efforts to define separate segments of property for taking purposes–either the coal in place under protected structures, or the ”support estate” recognized under Pennsylvania law. 260 Economic impact is measured by reference to the property as a whole; consideration of the coal placed off limits to mining as merely part of a larger estate and not as a separate estate undermined the commercial impracticability argument.

In a case examining a Moratorium imposed on development in the Lake Tahoe area, the U.S. Supreme Court has decided that a moratorium on development is not necessarily a taking, and that regulatory takings cases must be decided on a case-by-case basis rather than on categorical rules, Tahoe-Sierra Preservation Council v. Tahoe Regional Planning Agency, 535 U.S. 302, 122 S. Ct. 1465, 152 L. Ed. 2d 517 (U.S., Apr 23, 2002) (NO. 00-1167).  …the Court held that because the regulation was temporary, it could not constitute a categorical taking.”

12 thoughts on “Gas Drilling : Inverse Condemnation : Private vs. Public Interests

  1. Jerry Lobdill

    The referenced 1889 case is from the US Supreme Court. The case was apparently about unfenced railroad right of way (ROW), dead pigs killed by a train, and an irate farmer who blamed the RR for negligence in failing to fence its ROW.

    This case invoked the 14th Amendment, the 1886 SC case of Santa Clara County v. Southern Pacific RR, and ruled that the RR had been deprived of its right NOT to fence its ROW, a right apparently granted to human persons as landowners in Iowa.

    This SC case cites also another SC case, that invoked the Santa Clara case, to find in favor of a mining company against a human plaintiff.

    My point here is that the Santa Clara case did NOT find that corporations were persons under the 14th Amendment. The only reference to such a crazy concept was in the HEADNOTES of that case, which part of any SC case does not ever carry the force of law. The HEADNOTES were written by a SC clerk after the case had been decided, and in this particular were WRONG. Yet the SC immediately pretended the opposite and began a series of wrong decisions on the basis of that 1886 case. The force of stare decisis has now made corporate personhood a fact which lawyers say cannot now be reversed.

    How crazy is that?????

  2. lizbucar Post author

    Dear Mr. Lobdill: Here is the link directly to the Supreme Court case in which corporations were determined to be persons. It is the exact case I cited in this article. It uses the exact language I quoted.

    If you have some evidence that subsequent cases wrongly included the language in the body of the decision, please substantiate the claim with either a link or a book citation.

    http://openjurist.org/129/us/26

    I’m not sure what your point is concerning the other cases and hope you will clarify but I will try to find links to those other earlier cases (which I did not cite to or quote) after I’ve had my coffee. Best, Liz

  3. lizbucar Post author

    Dear Angry Letter Writer Who Did NOT Post A Comment In This Public Forum But Rather To My Home Email —

    As an Auxiliary member of the Sullivan County Chapter of Vietnam Veterans during the 1980s and early 1990s, I fought to have road salt taken off our roads due to the harmful impact on our gardens, farmers and food supply. In that same capacity, I fought to ban herbicide treatments along our roads for the same reasons. I was successful in getting the Sullivan County Board of Supervisors (that legislative body’s name at the time) to write a letter of agreement to NYS.

    No, to those who’ve asked: I have NOT fought to keep embalming fluid out of the ground. Perhaps those who have can send us a link to an organization with whom they’ve collaborated…?

  4. lizbucar Post author

    Follow-up to Mr. Lobdill’s points concerning the US Supreme Court’s history of considering corporations as persons.

    Here is the language to which the Court referred in the Santa Clara case. It is in the Court’s notes on the Santa Clara case:

    (2) That the provisions of the constitution and laws of California, in respect to the assessment for taxation of the property of railway corporations operating railroads in more than one county, are in violation of the fourteenth amendment of the constitution, in so far as they require the assessment of their property at its full money value, without making deduction, as in the case of railroads operated in one county, and of other corporations, and of natural persons, for the value of the mortgages covering the property assessed; thus imposing upon the defendant unequal burdens, and to that extent denying to it the equal protection of the laws.

    Here is the link where the language can be found:

    http://openjurist.org/118/us/394

    If that is insufficient response to your argument, I would remind you that in the Minneapolis case, the Supreme Court affirmed quite clearly, “We admit also… that corporations can invoke the benefits of provisions of the constitution and laws which guaranty [sic] to persons the enjoyment of property, or afford to them the means for its protection, or prohibit legislation injuriously affecting it.“

    Regardless of your point concerning the over-zealous Supreme Court clerk, the Court in The Minneapolis and St. Louis Railroad case agreed that for their purposes, corporations were persons within the context of the Fourteenth Amendment.

    I’m especially curious though about your thoughts on the point of the article concerning “inverse condemnation.”

  5. Sara

    I see the interest in “takings law” as a positive development. Suddenly, landowners and gas companies are concerned that drilling in NY is not going to happen as they planned after all. Their sure-bet is looking less sure, and they’re frantically looking for costly threats to force the drilling ahead. I say, Hooray for our side! Let’s re-double our effort!

  6. James Barth

    I have heard several of the NWPOA people, most especially the executive director, demand compensation if drilling is not permitted. I am not a lawyer, but I think Liz Bucar, and Cliff Enright are correct. This denial of permit would be perfectly legal and morally correct, if such drilling is determined to be a threat to local or regional health, or welfare. A moratorium, under current conditions, would be most logical, and prudent.

    The precautionary principle should apply while the EPA studies are being performed. This should also apply until the DRBC has established clear and consistant rules and regulations that govern the entire basin (PA and NY should have the same set of rules in the basin). This can be established by either the DRBC, or the US EPA. The Delaware River Basin does not adhere to one state boundary, but four. The DRBC has an obligation to the entire basin. If this type of drilling and fracturing is determined safe, and when proper laws are in place that will regulate, and when enforcement is sufficient to protect, then it can move forward. What would constitute the above should be publicly aired and commented on, before being adopted.

    As to a “taking”. The police powers would be preventing ONE use. The landowners have multiple potential uses that would not be infringed upon. The most basic would be to sell the property, if the owner can not afford to own 712 acres, for example. Or, if a person(s) purchased, say 435.5 acres in order to bet on the coming gas “gold rush”, and those owners would not be able to afford keeping (or no longer want to keep) the property, then she/he could simply sell the property that he/she purchased speculatively between June of 2008 and June of 2009.

    Instead, the drilling advocates tell the non leasing property owners, who can afford to own their property (or who choose not to seek support through gas extraction) to sell and move away. Perhaps, this could be phrased as, “Gas extraction, love it or leave it!”

    I would rather quote Winston Churchill’s famous paragraph: ” We shall go on to the end, we shall fight in France, we shall fight on the seas and oceans, we shall fight with growing confidence and growing strength in the air, we shall defend our Island, whatever the cost may be, we shall fight on the beaches, we shall fight on the landing grounds, we shall fight in the fields and in the streets, we shall fight in the hills; we shall never surrender, and even if, which I do not for a moment believe, this Island or a large part of it were subjugated and starving, then our Empire beyond the seas, armed and guarded by the British Fleet, would carry on the struggle, until, in God’s good time, the New World, with all its power and might, steps forth to the rescue and the liberation of the old.”

    Or, perhaps something a bit less dramatic.

  7. lizbucar Post author

    Sara, I agree that taking taxpayers hostage is a desperate act. I hope Senator Bonacic comes to realize it. Thank you for taking your time to comment!

    James, Thank you for stressing the point that even if property holders are unable to lease their mineral rights, there are a ton of productive things that can be done with land in the Basin… A regional creamery might be a good place to start.

    Which would mean that those of us who have fought for a moratorium must fight just as hard for local farms, transportation and business initiatives that will create sustainable, long-lasting employment.

    Maria Grimaldi wrote a post here that incorporated one great idea after another. Of course it’s just the beginning but when I stand in a DRBC hearing and am told that a moratorium on drilling will set the hounds of development and/or lawsuits loose, I can’t help but wonder which part of our Basin the speaker cares about. Especially when, as you say, so many tracts of land have been purchased in apparent pre-drilling speculation.

    Here’s the link to Maria’s Transition Town article:

    https://lizjbucar.wordpress.com/?s=grimaldi

  8. Jerry Lobdill

    Dear Ms. Bucar,

    I’m not a lawyer, but I’m not enamored of what’s been done by clever lawyers to our Founders’ concept of government as put forward in the U. S. Constitution. I am a long time activist for the environment. I’m a retired physicist and chemical engineer whose career was spent in doing R&D in applied science.

    My comment was not in criticism of the citations in your original essay. It was intended to expand on the concept of corporate personhood and how it came to dominate our lives. This gas drilling issue is my current major area of activism, and it is corporate personhood that has gotten the domination efforts of the gas industry so much mileage, in my opinion.

    The story of the 1886 SC case is a large part of the meat of the book, “Unequal Protection”, by Thom Hartmann. I recommend that book to lay readers. The book does not go into a litany of all the subsequent cases that used this 1886 case in support of corporate personhood, and I was not aware of the case of the unfortunate pigs, but I was struck by how soon after the 1886 case big money started their stare decisis effort to cast the concept in stone.

    I have been one of the activists at the forefront of the effort to save Fort Worth from the gas drilling insanity since 2007. Previous to that I was the technical advisor to a select committee of the Philmont Staff Association advising the Philmont Scout Ranch about the evils of a proposal to make a coalbed methane gas field out of the Valle Vidal in New Mexico.

  9. lizbucar Post author

    Dear Mr. Lobdill, Thank you for clarifying your comments! And, though not necessary, your personal context certainly provides greater understanding.

    I think it’s important that entities that can be sued have the rights of Due Process and Equal Protection as provided by the Fourteenth Amendment — whether that entity is Chesapeake or the tradesman who keeps my furnace in good working order.

    A lawsuit implies that the “complainant” or “plaintiff” believes the entity (whether Wal-Mart or the neighbor next door) has not met its obligations as a citizen. The intent of the lawsuit is to force the entity to behave as a responsible citizen. Consequently, I think it’s imperative that the entity have the right to defend itself.

    In these days when the business interests (rights) of corporations are so entangled with government, it’s imperative that local businesses and citizens have the protection of the Fourteenth Amendment, also. Otherwise, as with Kelo, any large business and its governmental partners can run roughshod over the community.

    Unfortunately, as we’ve seen in New Mexico, Wyoming, Pennsylvania (and on and on) large business interests like Chesapeake, Cabot et al seemingly have unlimited RIGHTS to Fourteenth Amendment “personhood” protections WITHOUT the balance of citizen RESPONSIBILITY.

    For me, that’s the crux of the moratorium issue. We have ample evidence of corporations behaving irresponsibly and we have ample evidence of their corporate partners (DEC, DEP and Bush’s EPA) colluding to NOT enforce corporate responsibility. (Whether that be due to half-baked regulations or ineffectual enforcement, the detrimental outcome is the same.)

    Over and over at hearings, citizens/tradespeople raise the same question, “Why is it the DEP/DEC/EPA/Building Inspectors will put me out of business (or prevent me building an addition on my house) with fines for the smallest of infractions but Stone Energy can flaunt the regulations and be given a permit to carry on as usual?”

    So, as we’re both saying, “The slope has been slippery for a long time.” My fear is we’re nearly to the bottom because corporations are granted the rights of persons without a concomitant enforcement of their responsibilities to the larger community.

    So underlying it all is this question, “Without local controls and community protections, where are OUR Equal Protections and Due Process Rights?”

    Thank you very much for helping to broaden this discussion, Mr. Lobdill!

  10. Pingback: NYS Drilling Moratorium : Aileen Gunther « Breathing is Political

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