Archive | Property Rights

My Findlaw Column on Alvarez v. Smith – A Key Property Rights Case Argued Before the Supreme Court Today

Findlaw has just posted a column I wrote on Alvarez v. Smith, an important Fourteenth Amendment Due Process Clause property rights case that was heard by the Supreme Court today:

Today, the Supreme Court hears Alvarez v. Smith, an important case that will affect the constitutional property rights of many people around the country but has failed to attract the attention it deserves.

In Alvarez, the federal Seventh Circuit Court of Appeals ruled that it was unconstitutional for Chicago police to seize cars and other property and hold it for many months at a time a without giving the owners any chance challenge the seizure. The Illinois Drug Asset Forfeiture Procedure Act (DAFPA) allows the police to seize property that may have been involved in a drug-related crime and hold onto it for up to 187 days without any kind of legal hearing. This rule applies even to property owned by completely innocent persons who simply had their possessions caught up in a drug investigation through no fault of their own… The three car owners involved in Alvarez were never even charged with a crime, much less convicted….

Laws like DAFPA pose a serious danger to the property rights of innocent people caught up in the War on Drugs. In many jurisdictions, police departments are allowed to auction off property seized in drug investigations and keep the profits, giving them a clear incentive to seize cars first and ask questions later. Moreover, many of the people whose cars are seized are poor or minorities. They often lack the political power necessary to persuade police to release their property without judicial intervention.

The Court of Appeals ruled that DAFPA violate the property owners’ rights under the Due Process Clause of the Fourteenth Amendment. It should have been an

[…]

Continue Reading 36

Elinor Ostrom and the Tragedy of the Commons

I was very happy to hear about Elinor Ostrom’s Nobel Prize in Economics. Her work focuses on the tragedy of the commons and collective action problems, which overlaps several of my own research interests. When Ostrom began writing in this field in the 1960s, the conventional wisdom in economics and political science was that the tragedy of the commons and other similar collective action problems could only be addressed through government intervention. Some dissenting economists (such as Ronald Coase) argued that they could often be addressed through privatization – converting common property into property owned by individuals, who would then have strong incentives not to overuse or destroy it. In a series of influential articles and books, Ostrom showed that there is a third way: often individuals can use social norms and informal institutions to manage common property resources and prevent tragedies of the commons. In many situations, Ostrom demonstrates, informal, decentralized approaches to managing common property resources are superior to government-imposed ones. The former take more account of the specialized local knowledge possessed by the people who actually use the resources and depend on them for their livelihoods.

For the best summary of Ostrom’s work, see her excellent 1990 book Governing the Commons.

Ostrom’s theories are often seen as an alternative to traditional libertarian thought, which emphasizes the importance of private property and markets. However, it actually fits well with libertarianism defined more broadly as advocacy of the superiority of private sector institutions over government. In some respects, Ostrom’s norm-based approach to dealing with tragedies of the commons is actually less dependent on government than the more traditional libertarian approach of relying on exclusive private property rights. The latter, after all, often depend on enforcement by government. Even where private property rights exist, it is often easier […]

Continue Reading 28

New York’s Highest Court to Hear Important Eminent Domain Case

The New York Court of Appeals – the state’s highest court -is about to consider an important property rights case, Goldstein v. New York State Urban Development Corporation. The case involves a challenge to the condemnation of large amounts of property for the purpose of transferring the land to influential developer Bruce Ratner, who plans to use most of it to build a stadium for the New Jersey Nets (which he owns), and “luxury housing.” The targeted property owners argue that these takings are not for a “public use,” as the New York state constitution requires. Certainly, the case is a fairly egregious example of the use of eminent domain power to benefit private interests. I wrote about this taking in a 2008 post addressing the federal court case in which the Second Circuit Court of Appeals upheld these condemnations under the federal Constitution (as it was required to do, given the Supreme Court’s decision in Kelo v. City of New London):

…[T]he fact that much of the condemned land is to be used to build a sports stadium raises serious red flags about the true likelihood that the general public will benefit from the condemnation. Numerous studies by economists show that public subsidies for stadium construction create no economic benefits for the general public….

Second, the court claims that the creation of “affordable housing” for the poor is one of the public benefits to be expected from the project. The project will indeed create some new housing units (in addition to the stadium). However, as the Second Circuit opinion concedes (pg. 15), almost 70% of the new housing units will be “luxury” units for the wealthy, and the remainder is mostly not guaranteed to be ever built and is still intended for the “middle class” rather than

[…]

Continue Reading 48

Does CHL ban in churches violate the First Amendment?

An opinion released today by the Arkansas Attorney General says “no.” Like most states, Arkansas allows adults to obtain a permit to carry a concealed handgun for lawful purposes, after passing a background check and  safety class.  Like a few states, Arkansas prohibits licensed carry in “Any church or other place of worship.”

In short, the AG opinion says that there is no Free Exercise violation because the statute does not (at least facially) hinder the exercise of religion. Further, the statute is one of general applicability, and does not single out religion for different treatment, because the Arkansas conceald handgun license (CHL) statute also bans CHL in some other locations. The opinon suggests that what these disparate places have in common is that they are likely to be crowded.

There is no Establishment Clause violation because the CHL in churches ban does not appear, facially, to favor one sect or denomination over another. (The AG opinion and this post both use “churches” to include synagogues, mosques, and all other houses of worship of various religions.)

The AG opinion strongly emphasizes that the issue is one of first impression, and that a full legal resolution of the issue might well require fact-finding.  The purpose of an Attorney General opinion is only facial review, and not the kind of fact-finding that a court might engage in.

Given the self-declared limited scope of the AG opinion, its tentative legal conclusions are plausible. However, I think that if we broaden our view a little bit–in either a court of law, or the court of public opinion–there do appear to be some potential violations of the Establishment and Free Exercise clauses.

Two preliminary caveats: First, neither the AG opinion nor this post address whether the church ban violates the right to arms clause of […]

Continue Reading 72

Goldstein v. Pataki and the Shortcomings of Kelo:

The US Court of Appeals for the Second Circuit recently decided Goldstein v. Pataki, a case challenging the condemnation of homes and other property in Brooklyn for the purpose of transferring them to developer Bruce Ratner, owner of the New Jersey Nets. Ratner plans to use the land to build a new stadium for the Nets, as well as other facilities, including some 2250 new housing units.

Not surprisingly, the Second Circuit upheld the condemnations. Under Kelo v. City of New London, they had very little choice. As I discuss in great detail in this article, Kelo mandates very broad judicial deference to the government in determining whether a condemnation is a genuine “public use” under the Fifth Amendment. Any potential benefit to the general public is sufficient, even if it is greatly outweighed by the project’s cost.

The case nonetheless reveals some of the serious shortcomings of Kelo and related precedents. Goldstein v. Pataki is a correct application of Kelo; it is also an example of the sort of abuse that more robust judicial protection of property rights could prevent.

First, the fact that much of the condemned land is to be used to build a sports stadium raises serious red flags about the true likelihood that the general public will benefit from the condemnation. Numerous studies by economists show that public subsidies for stadium construction create no economic benefits for the general public (see, e.g, this book published by the liberal Brookings Institution).

Second, the court claims that the creation of “affordable housing” for the poor is one of the public benefits to be expected from the project. The project will indeed create some new housing units (in addition to the stadium). However, as the Second Circuit opinion concedes (pg. 15), almost 70% of the […]

Continue Reading 32