Loretto v. Teleprompter Manhattan Catv Corp., 458 U.S. 419 (1982)

Loretto v. Teleprompter Manhattan CATV Corp.

No. 81-244

Argued March 30, 1982
Decided June 30, 1982
458 U.S. 419

APPEAL FROM THE COURT OF APPEALS OF NEW YORK

Syllabus

A New York statute provides that a landlord must permit a cable television (CATV) company to install its CATV facilities upon his property and may not demand payment from the company in excess of the amount determined by a State Commission to be reasonable. Pursuant to the statute, the Commission ruled that a one-time $1 payment was a reasonable fee. After purchasing a five-story apartment building in New York City, appellant landlord discovered that appellee CATV companies had installed cables on the building, both "crossovers" for serving other buildings and "noncrossovers" for serving appellant’s tenants. Appellant then brought a class action for damages and injunctive relief in a New York state court, alleging, inter alia, that installation of the cables insofar as appellee companies relied on the New York statute constituted a taking without just compensation. Appellee New York City, which had granted the companies an exclusive franchise to provide CATV within certain areas of the city, intervened. Upholding the New York statute, the trial court granted summary judgment to appellees. The Appellate Division of the New York Supreme Court affirmed, and, on further appeal, the New York Court of Appeals also upheld the statute, holding that it serves the legitimate police power purpose of eliminating landlord fees and conditions that inhibit the development of CATV, which has important educational and community benefits. Rejecting appellant’s argument that a physical occupation authorized by government is necessarily a taking, the court further held that the statute did not have an excessive economic impact upon appellant when measured against her aggregate property rights, did not interfere with any reasonable investment-backed expectations, and accordingly did not work a taking of appellant’s property.

Held: The New York statute works a taking of a portion of appellant’s property for which she is entitled to just compensation under the Fifth Amendment, as made applicable to the States by the Fourteenth Amendment. Pp. 425-441.

(a) When the "character of the governmental action," Penn Central Transportation Co. v. New York City, 438 U.S. 104, 124, is a permanent physical occupation of real property, there is a taking to the extent of the occupation without regard to whether the action achieves an important public benefit or has only minimal economic impact on the owner. Pp. 426-435.

(b) To the extent that the government permanently occupies physical property, it effectively destroys the owner’s rights to possess, use, and dispose of the property. Moreover, the owner suffers a special kind of injury when a stranger invades and occupies the owner’s property. Such an invasion is qualitatively more severe than a regulation of the use of property, since the owner may have no control over the timing, extent, or nature of the invasion. And constitutional protection for the rights of private property cannot be made to depend on the size of the area permanently occupied. Pp. 435-438.

(c) Here, the cable installation on appellant’s building constituted a taking under the traditional physical occupation test, since it involved a direct physical attachment of plates, boxes, wires, bolts, and screws to the building, completely occupying space immediately above and upon the roof and along the building’s exterior wall. There is no constitutional difference between a crossover and noncrossover installation, since portions of the installation necessary for both types of installation permanently appropriated appellant’s property. The fact that the New York statute applies only to buildings used as rental property does not make it simply a regulation of the use of real property. Physical occupation of one type of property but not another is no less a physical occupation. The New York statute does not purport to give the tenant any enforceable property rights with respect to CATV installation, and thus cannot be construed as merely granting a tenant a property right as an appurtenance to his leasehold. Application of the physical occupation rule in this case will not have dire consequences for the government’s power to adjust landlord-tenant relationships, since it in no way alters the usual analysis governing a State’s power to require landlords to comply with building codes. Pp. 438-440.

53 N.Y.2d 124, 423 N.E.2d 320, reversed and remanded.

MARSHALL, J., delivered the opinion of the Court, in which BURGER, C.J., and POWELL, REHNQUIST, STEVENS, and O’CONNOR, JJ., joined. BLACKMUN, J., filed a dissenting opinion, in which BRENNAN and WHITE, JJ., joined, post, p. 442.