97 F. Supp. 3d 713
E.D.N.C.2014Background
- Six oceanfront cottages in Nags Head were damaged in a November 12, 2009 storm; the Town closed the adjacent road during the storm, preventing contractors from finishing protective work.
- On November 30, 2009 the Town issued letters declaring each cottage a public nuisance under subsections (b) and (c) of its Nuisance Ordinance, ordered removal within 18 days, and later assessed $100/day civil penalties when owners refused to demolish.
- Subsection (c) declared any structure located in a “public trust area” a nuisance regardless of condition; the Town treated the dry‑sand beach as part of the public trust and had an informal enforcement standard focused on obstruction of public beach use.
- Owners sued in 2010 raising federal and state claims (including takings, inverse condemnation, due process, declaratory relief); the Fourth Circuit reversed dismissal of the regulatory‑takings claim and remanded.
- The Town later adopted Ordinance 10‑07‑021 barring permits for structures the Town considered in the public trust; the Town renourished the beach in 2011, lifted the subsection (c) declarations, and owners eventually obtained most building permits and began repairs.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Authority to declare structures nuisances solely because they lie on dry‑sand beach (Ordinance §16‑31(6)(c)) | Town exceeded delegated authority; only State (Attorney General) may enforce public trust rights | Town relied on public trust rights to treat dry‑sand structures as nuisances | Court: Owners win — Town lacked authority; summary judgment for Owners on claim 2 and 4 |
| Whether cottages are on wet‑sand (state‑owned) beach | Owners: recent survey shows cottages are not on wet‑sand beach | Town had no evidence to the contrary | Court: Owners win — none of the cottages are on the wet‑sand beach (claim 1) |
| Physical‑occupation/block‑access takings (Loretto/Nollan) — did Town’s nuisance declaration or statements effect a permanent physical invasion or authorize public access? | Owners: Town’s repeated assertions that cottages lie in public trust granted public perpetual access; thus a physical‑occupation taking | Town: it only stated a legal view and did not authorize or license public invasion; emergency actions (blocking access) were justified | Court: Town wins on physical‑occupation and block‑access theories; summary judgment for Town on those portions |
| Temporary regulatory taking from refusal to issue permits and enforcement (Penn Central) | Owners: Nuisance declaration plus permit denial prevented repairs and rental income, causing major economic loss — temporary taking | Town: Fourth Circuit precedent and other factors show no deprivation or causation; other regulatory constraints also relevant | Court: Genuine issues of material fact exist on Penn Central factors and causation; summary judgment denied for both parties — claim survives to jury/trial |
| Civil penalties for failing to demolish under Town orders | Owners: Town lacked authority to order demolition and thus cannot recover penalties | Town: penalties authorized under its nuisance enforcement provisions | Court: Owners win — Town lacked legal authority to order destruction without opportunity to repair and cannot collect civil penalties (Town’s 4th counterclaim dismissed) |
Key Cases Cited
- Lingle v. Chevron U.S.A. Inc., 544 U.S. 528 (explains takings doctrine and distinguishes takings from due‑process inquiry)
- Loretto v. Teleprompter Manhattan CATV Corp., 458 U.S. 419 (permanent physical occupation is a per se taking)
- Lucas v. S.C. Coastal Council, 505 U.S. 1003 (total loss of economically beneficial uses may be a per se taking absent background principles)
- Penn Central Transp. Co. v. New York City, 438 U.S. 104 (multi‑factor balancing test for regulatory takings)
- Nollan v. California Coastal Comm’n, 483 U.S. 825 (public easement conditioned on permit can be a taking)
- Tahoe‑Sierra Pres. Council, Inc. v. Tahoe Reg’l Planning Agency, 535 U.S. 302 (temporary regulatory takings doctrine)
- First English Evangelical Lutheran Church v. Cnty. of Los Angeles, 482 U.S. 304 (temporary regulatory takings require compensation if they deny all use)
- Town of Nags Head v. Cherry, Inc., 219 N.C. App. 66 (N.C. Ct. App. holding that only State may enforce public trust rights)
- Toloczko v. Town of Nags Head, 728 F.3d 391 (4th Cir. discussion of public trust/enforcement by State)