Monday, May 24, 1999

In ruling today in City of Monterey v. Del Monte Dunes, the U.S. Supreme Court handed a single developer, developers and advocates of community rights a decidedly mixed bag.

The Court affirmed a $1.45 million jury verdict in favor of a developer. The Court ruled first that a developer had a right to jury trial under the Seventh Amendment of the U.S. Constitution in the extremely limited context of a federal claim alleging both that a state had (1) taken property within the meaning of the Fifth Amendment and (2) provided no procedure by which a developer could recover compensation for that taking. The Court then upheld the jury's award on procedural grounds -- the fact that the city had not objected to the jury instructions -- without addressing whether the jury's ruling on the merits was correct.

The Court's narrow ruling in favor of a single developer, however, gave communities much to cheer about. Specifically:

• The Court overruled a key portion of the Ninth Circuit's opinion for the developer that had suggested that Monterey's permit denial must be "related both in nature and extent to the proposed development." The Court unanimously ruled that this "roughly proportional" test derived from the Court's 1994 case, Dolan v. Tigard, is limited to "the special context of exactions -- land-use decisions conditioning approval of development on the dedication of property to public use."

"While ruling for this particular developer, the Supreme Court has given communities much to cheer about. Monterey has lost, but state and local governments around the country have largely prevailed in this case."