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Horne v. Dep't of Agric. - 135 S. Ct. 2419 (2015)

Rule:

Four years after it decided Penn Central Transp. Co. v. New York City, the United States Supreme Court reaffirmed the rule that a physical appropriation of property gives rise to a per se taking, without regard to other factors. In Loretto v. Teleprompter Manhattan CATV Corp., the Court held that requiring an owner of an apartment building to allow installation of a cable box on her rooftop was a physical taking of real property, for which compensation was required. That was true without regard to the claimed public benefit or the economic impact on the owner. The Court explained that such protection was justified not only by history, but also because such an appropriation is perhaps the most serious form of invasion of an owner’s property interests, depriving the owner of the rights to possess, use, and dispose of the property. That reasoning—both with respect to history and logic—is equally applicable to a physical appropriation of personal property. Nothing in the text or history of the Takings Clause of the Fifth Amendment, or United States Supreme Court precedents, suggests that the rule is any different when it comes to appropriation of personal property. 

Facts:

The Agricultural Marketing Agreement Act of 1937 authorized the Secretary of Agriculture to promulgate “marketing orders” to help maintain stable markets for particular agricultural products. The marketing order for raisins established a Raisin Administrative Committee that imposed a reserve requirement for growers to set aside a certain percentage of their crop for the account of the Government, free of charge. The Government made use of those raisins by selling them in noncompetitive markets, donating them, or disposing of them by any means consistent with the purposes of the program. If any profits were left over after subtracting the Government's expenses from administering the program, the net proceeds were distributed back to the raisin growers. In 2002-2003, raisin growers were required to set aside 47 percent of their raisin crop under the reserve requirement. In 2003-2004, 30 percent. Marvin Horne, Laura Horne, and their family were raisin growers who refused to set aside any raisins for the Government on the ground that the reserve requirement was an unconstitutional taking of their property for public use without just compensation. The Government fined the Hornes the fair market value of the raisins, as well as additional civil penalties for their failure to obey the raisin marketing order.

The Hornes sought relief in federal court, arguing that the reserve requirement was an unconstitutional taking of their property under the Fifth Amendment. On remand from the Supreme Court of the United States over the issue of jurisdiction, the United States Court of Appeals for the Ninth Circuit held that the reserve requirement was not a Fifth Amendment taking. The Ninth Circuit Court determined that the requirement was not a per se taking because personal property is afforded less protection under the Takings Clause than real property and because the Hornes, who retained an interest in any net proceeds, were not completely divested of their property. The Ninth Circuit held that, as in cases allowing the government to set conditions on land use and development, the Government imposed a condition (the reserve requirement) in exchange for a Government benefit (an orderly raisin market). It held that the Hornes could avoid relinquishing large percentages of their crop by “planting different crops.” 

Issue:

Was there a taking, in violation of the Takings Clause of the Fifth Amendment, where the the U.S. Government took raisins belonging to family farmers and required that the farmers set aside a portion of their raisins for the Government, free of charge?

Answer:

Yes

Conclusion:

On a writ of certiorari, the Supreme Court of the United States held that the U.S. Government took raisins belonging to family farmers who grew raisins and handled raisins they purchased from other growers when it required that the farmers set aside a portion of their raisins for the Government, free of charge. The Court held that the U.S. Court of Appeals for the Ninth Circuit erred when it upheld the Government's decision imposing fines and penalties on the farmers because they refused to set aside a portion of their raisins for the Government in 2002-2003 and 2003-2004. The Takings Clause of the Fifth Amendment required the Government to pay just compensation when it took personal property, just as when it took real property, and the Government could not make raisin growers relinquish their property without just compensation as a condition for selling their raisins in interstate commerce. The reserve requirement imposed by the Raisin Committee was a clear physical taking. Actual raisins were transferred from the growers to the Government. Title to the raisins passed to the Raisin Committee.The Court reversed the judgment. 

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