In ruling against the Yims, the Western District of Washington ignored or discounted two landmark Supreme Court rulings involving property rights. These cases established two rules that together accord certain elements of property a higher standard of review than run-of-the-mill rational basis. The first concerns the Fourteenth Amendment’s Due Process Clause, which protects “life, liberty, or property” from state interference without “due process of law.” The second involves the Fifth’s Takings Clause, which provides that “nor shall private property be taken for public use, without just compensation.”
In 2005, in Lingle v. Chevron, the Supreme Court confirmed that for a property regulation to comply with the Due Process Clause, it must “substantially advance a legitimate state interest.” Plausibility, which is enough for rational basis, will not cut it under this test. As the Court in Lingle put it, the “substantially advances” rule “asks, in essence, whether a regulation of private property is effective in achieving some legitimate public purpose.” But even that doesn’t cut it for the fundamental elements of property—that is, those attributes that make property, well, property—because in last term’s Cedar Point Nursery v. Hassid the Court held that public interferences with those elements are subject to the “per se takings” test. If a fundamental aspect of property is violated, then that property right has been “taken” under the Fifth Amendment’s Takings Clause.
One such aspect of property—the right to exclude—is a sine qua non of property ownership. Seattle’s interference with this fundamental right merits a heightened scrutiny. Together, Lingle and Chevron prescribe a formula for measuring due process violations of individuals’ fundamental property rights. While some of its variables are yet to be determined—it will take more Supreme Court rulings to do that—the Court has indicated that the right to exclude cannot be surrendered to any barely respectable reason lawmakers might conjure.
The Cato Institute has filed a brief in the Ninth Circuit supporting the Yims, as we did in a similar case last year involving the Yims and their fellow Seattle landlords, urging the Ninth Circuit Court of Appeals to reverse the district court’s use of rational basis review. Applying a heightened level of scrutiny, the circuit court should then have no choice but to invalidate the FCHO for violating the Yims’ due process rights.
