Another Judicial Takings Case Headed to the Court

The Montana Supreme Court overturned more than 100 years of state property law concerning navigable waters by effectively converting the title in hundreds of miles of riverbeds to the State. The majority of that court ruled that the entirety of the Missouri, Clark Fork, and Madison rivers were navigable at the time of Montana’s statehood, producing a broad holding that eradicates property rights to the rivers and riverbanks that Montanans had enjoyed for over a century.

Before this case, the hydroelectric energy company PPL Montana and thousands of other private parties exercised their property rights over these non-navigable stretches that the state never claimed.  Today, Cato joined a brief filed by the Montana Farm Bureau Federation supporting the PPL Montana’s request that the U.S. Supreme Court review the Montana high court’s ruling for possible Takings Clause violations under the Fifth Amendment.

We argue two main points.  First, that the Court should adhere to its standard for navigability rights set out in Utah v. U.S. in 1933. Unlike the approach taken by the Montana Supreme Court’s majority — that entire rivers were navigable simply because certain reaches of the river were navigable — the U.S. Supreme Court in Utah used an approach of meticulously analyzing the rivers at issue section-by-section. Second, this arbitrary ruling against rights long protected by Montana law amounts to a “judicial taking,” as explained last term Stop the Beach Renourishment v. Florida Dept. of Environmental Protection (in which Cato also filed a brief). There, a plurality of the Court held that there is no “textual justification” for limiting takings claims deriving from executive or legislative action, thereby extending it to a judicial action of the same nature (and two other members of the Court found potential relief in the Fourteenth Amendment’s Due Process Clause). Here, the Montana court did exactly that, violating due process rights that the Montana legislature could not and further violating the procedural due process rights of the thousands harmed by the decision in not affording them notice or a hearing.

The U.S. Supreme Court should thus review the case to reinforce its Utah precedent and ensure that arbitrary judicial takings of this sort cannot continue.  The name of the case is PPL Montana, LLC v. Montana.  The Court will decide later this fall whether to take it up.