While property may be regulated to a certain extent, if regulation goes too far it will be recognized as a taking.
Defendant appealed from a decision of the Supreme Court of Pennsylvania, which found that although defendant had valid contractual and property rights, the Kohler Act, 1921 Pa. Laws 1198, was a valid exercise of police power and allowed an injunction to be issued to prevent defendant from mining under plaintiff's surface land. Defendant appealed appellate court's decision for plaintiffs in plaintiff's suit to enjoin defendant from mining under plaintiff's house and removing the supports and causing subsidence. A deed granted plaintiffs the surface rights to certain land but reserved to defendant the right to mine all coal under the house. Plaintiffs argued that the Kohler Act, 1921 Pa. Laws 1198, extinguished defendant's right to mine under plaintiff's surface land.
Can the Kohler Act be sustained as an exercise of the police power, so far as it affects the mining of coal under streets or cities in places where the right to mine such coal has been reserved?
The Court reversed the lower court's decision. The Court held that the Kohler Act was unconstitutional as a taking of defendant's rights under a valid contract. In order to protect themselves, plaintiffs should have contracted to acquire more than the surface rights. The Kohler Act could not have been used to terminate the valid contractual rights defendant received, nor could the Act could be used to take defendant's contract rights without adequate compensation.