Supreme Court limits ability to enforce access to private property without compensation

On June 23, 2021, the United States Supreme Court ruled that a California law granting union organizers the “right to access” an employer’s private property violated the United States Constitution because it took employer property for public use without paying compensation. In the decision Cedar Point Nursery v. Hassid, the Supreme Court ruled that a law allowing third parties to access the premises of a private employer, even for the purpose of organizing trade unions on a temporary basis (three hours a day, 120 days a year) was equivalent to physical taking of the employer’s property without fair compensation. In its decision to strike down California law, the Supreme Court was careful to note that no employee resided on the employer’s premises. In ruling on behalf of the employer and finding that California labor regulations violated the United States Constitution, the court distinguished between laws such as California that would allow the physical occupation of land private by a third party and laws that are permissible regulations of the use of private property.

The Court held that there is a foreclosure when “the government has physically taken a property for itself or for someone else – by whatever means – or rather has restricted the ability of a landlord to use their own property ”. Cedar point, Slip op. p. 7. In an effort to distinguish California labor regulations at issue in the Hasid case of civil rights and other laws that govern the conduct of businesses open to the public, the Court noted that “[l]imitations of how a business generally open to the public may treat individuals on premises are easily distinguished from regulations granting a right to invade property closed to the public. Cedar point, Leaflet op., P. 14-15.

Defining what can often be a nebulous standard of when a law constitutes an unconstitutional take rather than a legal regulation of use, the Supreme Court stressed that a characteristic of a government take is when the government takes away from an owner the right to exclude others from one’s property, “one of the most precious property rights”. Cedar point, Leaflet op., P. 7. As with all levies, the United States Constitution prescribes that the remedy for the owner is compensation as opposed to return of the property.

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