Euclid v Ambler Realty Co. 272 U.S. 465 (1926). Where it all began. Euclid. Euclid. 15 miles. But everybody’s doing it!. City of New York adopts zoning in 1915 Many cities followed New York’s lead
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Euclid v Ambler Realty Co.272 U.S. 465 (1926) Where it all began.
Euclid 15 miles
But everybody’s doing it! • City of New York adopts zoning in 1915 • Many cities followed New York’s lead • Federal Government promulgated the Standard State Zoning Enabling Act (SSZEA) in 1926 . . . The same year as Euclid decision. • Euclid adopting it’s zoning code in 1922. • By that time  there were hundreds of zoning codes, ordinances or resolutions.
Background • Euclid largely was a farming community in the 1920’s, but one that had become connected to Cleveland by inter-urban rail. • Euclid enacted its zoning code in 1922 with 6 use districts: • U-1, single family detached homes • U-2, U-1 plus duplex units • U-3, U-2 plus apartments • U-4, U-3 plus office & commercial • U-5, U-4 plus warehouses and some manf. • U-6, U-5 plus all other industries.
This is termed “cumulative” or “Euclidian” zoning, meaning that . . . • All more restrictive uses are permitted in the less restricted area, so . . . • Single family is permitted in all 6 districts • Duplexes are permitted in 5 districts, U-2 thru U-6 • Apartments are permitted in 4 districts, U-3 thru U-6 • Office & Commercial are permitted in 3 districts, U-4, U-5 & U-6. • Limited manufacturing is permitted in 2 districts, U-5 and U-6. • All other activities are only permitted in 1 district, U-6.
The property . . . . • Ambler Realty Co. owned 68 acres of land in Euclid, Ohio. • Purchased in 1911. • Euclid’s zoning code would restrict the property to: • Industrial development – 60% or 41 acres • Apartments – 6% or 4 acres • Duplex units – 33% or 22 acres • Note, none of the property is single family
Configuration N ←Rail Road to Cleveland R D e e s v i e d l e o n p t e i d a l R D e e s v i e d l e o n p t e i d a l Industrial Apartments 2 Family home Euclid Avenue 1,800’
Impact on the property owner • Land as industrial $100,000 per acre (7/2002 = 100) • Land as residential $25,000 per acre (7/2002 = 100) • Regulated land would be diminished 75% in value • Parcel would diminish in value 29% -- $1,950,000
The suit • 15 property owners joined together in brining the suit • Newton D. Baker, former Secretary of War and mayor of Cleveland represented the plaintiffs (heavy hitter) • This was a facial attack, arguing that the application of the ordinance would be wrong in every instance because it was a denial of due process.
Lower Court • District Judge David Westenhaven ruled, in January 1924, that the ordinance was an improper use of the Village’s police powers and thus unconstitutional.
Appeal • City argued that zoning was a form of nuisance control and thus a reasonable exercise of the police power. • Plaintiff claimed that zoning deprived an owner of property without due process.
Opinion by Justice Sutherland • Justice George Sutherland, a conservative perhaps best known for his opposition to FDR’s “new deal.” • He swung the court toward Euclid, accepting zoning as a legitimate means of addressing problems arising from the nation’s growth.
Sutherland’s observation • “Until recent years, urban life was comparatively simple; but with the great increase and concentration of population, problems have developed, and constantly are developing, which require, and will continue to require, additional restrictions in respect of the use and occupation of private lands in urban communities.”
What’s Southerland talking about? • Urban America was on the ascendancy • In the 1920 census 50% of nation’s population were in urbanized areas (2,500 persons or more) • The problems of urbanization where before society. Ignoring them was not option. • The only question was who would deal with them and under what legal theory.
No one disagreed . . . • The problems were present and someone was going to have to do something. • BUT . . . • Should the problems be dealt with on a case by case basis and on the basis of nuisance law OR . . . • Should communities be allowed to restrict activities in certain areas, presumably to prevent nuisances.
“The ordinance under review . . . must find [its] justification is some aspect of the police powers.” • “A nuisance may be merely a right thing in the wrong place, like a pig in a parlor instead of in the barnyard.” • “If the validity of the legislative classification for zoning purposes be fairly debatable, the legislative judgment must be allowed to control.” So keeping the pig out of the parlor would be a reasonable thing to do, as distinct from allowing the pig in, and then ejecting it when it acted like a pig.
And, what’s more • “Apartment houses are often mere parasites, taking advantage of the residential character created by surrounding single-family use. And, one apartment house is followed by another, creating noise, congestion, traffic until the residential character is utterly destroyed.”
Exclusion of business will • Achieve . . . • Easier provision of fire apparatus • Increase safety and security of homelife • Prevent street accidents, especially to children • Reducing traffic • Reducing noise • Reducing other conditions that produce or intensify nervous disorders • Preserve a more favorable environment in which to raise children
“. . .the exclusion of buildings devoted to business, trade, etc. from residential districts, bears a rational relationship to the health and safety of the community.” • Therefore the exclusion of buildings devoted to business, trade, etc. from residential districts would be an exercise of the police power to protect public health, safety etc.
Facial attack • Southerland – “[We] determine . . . that the ordinance in its general scope and dominant features, so far as its provisions are here involved, is a valid exercise of authority, leaving other provisions to be dealt with as cases arise directly involving them. • [meaning that “other provisions” will be dealt with as they are applied in individual cases]
The rest of the story • The Ambler site remained vacant until World War II, when it was rezoned by the city to industrial as a site for a General Motors aircraft plant. • After the war GM used it as a Fisher body plant, assembling Cadillac bodies. • In 1994 GM closed the plant – permanently • In 1996 the site sold for $3 million [$44,000 per acre] and is now available for rent.
The Denominator Issue Part I • The 68 acre site as Industrial or U–6: • 68 acres * $100,000 = $6.8 Million • The 68 acre site as U-2, U-3 & U-6: • 42 acres * $100,000 = $4.2 Million • 4 acres * $25,000 = 0.1 Million • 22 acres * $25,000 = 0.55 Million $4.85 Million • Change -$1.95 Million -29%
What is the extent of diminution? • Did the site diminish by 29% in value? • Did the regulated property diminish by 75% in value? • The answer to both is yes! • Which is the relevant measure of harm?