Lost Tree Village Corporation v. United States
115 Fed. Cl. 219
Fed. Cl.2014Background
- Lost Tree sought a wetlands fill permit under Section 404 for Plat 57 on John’s Island, Florida, which the Corps denied in August 2004.
- The relevant parcel for takings analysis was defined as Plat 57 (and previously Plat 55 and scattered wetlands) by the trial court, but the Federal Circuit later held Plat 57 alone was the proper parcel.
- Appraisals showed Plat 57’s value with a permit at about $4.72 million and its value without a permit at about $27,500, yielding a substantial diminution if the permit is denied.
- On remand, the court re-evaluated the Lucas/Penn Central framework using Plat 57 alone, deciding the permit denial caused a near-total loss of value.
- The court concluded a 99.4% diminution constitutes a categorical taking under Lucas and also weighs heavily under Penn Central’s economic impact factor.
- The court awarded Lost Tree $4,217,887.93, plus interest calculated with ten-year STRIPS from 2004 to judgment.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Proper parcel for takings analysis | Lost Tree: Plat 57 plus other holdings define the parcel. | United States: Plat 57 alone is the relevant parcel. | Parcel should be Plat 57 alone. |
| Appropriate takings framework on remand | Lucas framework or Penn Central as appropriate; no new valuation theory needed. | Reopen record and consider new valuation theory on remand. | Lucas-based analysis yields a taking; Penn Central also supports taking without reweighing unrelated factors. |
| Value with permit vs value without permit | Plat 57’s value with permit should reflect highest and best use; trial evidence suffices. | New valuation approach considering pre-denial uncertainty is warranted. | Value with permit $4,245,387.93; without permit $27,500. |
| Whether the diminution is compensable under Lucas | Diminution nearly total should be compensable as a categorical taking. | Diminution alone may not necessitate compensation absent total wipeout. | Yes, 99.4% diminution constitutes a categorical taking under Lucas. |
Key Cases Cited
- Lucas v. South Carolina Coastal Council, 505 U.S. 1003 (U.S. 1992) (categorical taking when all economically beneficial use is taken)
- Penn Central Transp. Co. v. City of New York, 438 U.S. 104 (U.S. 1978) (three-factor framework for regulatory takings)
- Tahoe-Sierra Pres. Council, Inc. v. Tahoe Reg’l Planning Agency, 535 U.S. 302 (U.S. 2002) (limits on regulatory takings if substantial economic impact remains)
- Palazzolo v. Rhode Island, 533 U.S. 606 (U.S. 2001) (economic impact and investment-backed expectations framework)
- Loveladies Harbor, Inc. v. United States, 21 Cl. Ct. 153 (Ct. Cl. 1990) (valuing property at highest and best use consistent with precedents)
- Brace v. United States, 72 Fed. Cl. 337 (Fed. Cir. 2007) (definition of highest and best use in valuation)
- Olson v. United States, 292 U.S. 246 (U.S. 1934) (constitutional consideration of land use in takings)
- Maritrans Inc. v. United States, 342 F.3d 1344 (Fed. Cir. 2003) (economic impact factor guidance in Penn Central analysis)
- Gindes v. United States, 740 F.2d 947 (Fed. Cir. 1984) (mandate and law-of-the-case limitations in appellate remands)