WHAT IF THE PLANNING BOARD WON'T LET YOU DO ANYTHING AT ALL WITH YOUR PROPERTY? Often, real estate professionals call me and ask me what can be done when the government denies a wetlands permit or some other permit that is needed to develop a piece of property. In other words, what can a property owner do when a planning board or zoning board or administrative agency denies a permit that is vital if the property is going to be developed.

I explain to these people that any permit denial which takes away all practical use of the property may be considered to be a "regulatory taking," which is also called an "inverse condemnation." While these terms may be foreign sounding, everyone in the real estate business really needs to be acquainted with them; so, I will now explain them to you so that you do not have to be shocked the next time you hear them.

To begin with we need to read the Fifth Amendment of the United States Consitution. Here it is:

"No person shall be held to answer for a capital, or otherwise infamous crime, unless on a presentment or indictment of a Grand Jury, except in cases arising in the land or naval forces, or in the Militia, when in actual service in time of War or public danger; nor shall any person be subject for the same offence to be twice put in jeopardy of life or limb; nor shall be compelled in any criminal case to be a witness against himself, nor be deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation. "

The Fifth Amendment is probably the most famous of our Constitutional amendments. You have heard the expression, "I'll take the 5th." This is what these people mean-that they will not be a witness against themselves in a criminal action. There is a lot of other important material here, but for now we are looking at the last phrase of the Amendment: "nor shall private property be taken for public use, without just compensation."

Note that language: property will not be "taken" without just compensation. These kinds of cases are formally called regulatory takings or inverse condemnation cases. But they are nicknamed "takings" cases based on the word "taken" found in the Fifth Amendment.

Any time the government over-regulates a piece of property so that it no longer has any practical use, it may be that it has "taken" the property without paying just compensation. For people in the real estate industry, this may apply to denied wetlands permits, denied coastal development permits, denied zoning variances, other denied development applications, including those which eliminates all practical use of the property. The sky is the limit in terms of the kinds of government actions that may result in a valid takings claim.

Condemnation is the power of the government to take title to any property that it needs for a public purpose. You are likely familiar with this concept in terms of highway expansions, new airports, new schools and parks. The federal government and the states have laws that govern the government's behavior when it condemns property. The government must always pay the property owner fair market value, and the property must always be used for a public purpose.

Inverse condemnation means that a property has been so over-regulated that the government might have well condemned it, so the term "inverse" condemnation. Often, an affected property owner will ask a court to force the government to commence condemnation proceedings.

The other term, regulatory taking, means that the government has effectively "taken" the property without paying for it by over-regulating it. In other words, it has taken the property through the enforcement of its own regulations.

In parts of the country that are heavily developed there are now pressures to curtail development. This is being done through a number of mechanisms that often include attempts to re-zone open spaces, limits on the ability of developers to install infrastructure, such as sewers, and protection of sensitive areas, such as wetlands.

As the urge to preserve open space increases, expect more assertions that the government has taken property without just compensation. History has shown that takings claims are a natural by-product of government efforts to slow development.

Does the government have a right to block all use of person's property through regulation? Often the answer is yes, if the reason is for a public purpose. But, and this is a big but, the government must pay full fair market value and related costs.

If the government does not pay full fair market value, and it often does not, then the owner must go to court, or wherever the law says he or she must go, to seek just compensation and related costs. That often means ultimately filing a "takings" lawsuit.

Takings cases are unfortunately hard fought by the government. Government agencies have unlimited financial resources, and can remain in court indefinitely. Private property owners, on the other hand, usually have limited funds and one thing the government often tries to do is outspend property owners. Often, these cases reveal government at its ugliest.

Government should play fair and should never try to steal property from its citizens. Certainly, the Fifth Amendment guards against exactly this from happening. But, in all of the takings cases that I have done, and I have done many, the government has acted very aggressively and, I believe, improperly. Be ready for a fight.

The information provided in this column is written by Stuart Lieberman,a practicing environmental attorney, and is for general information purposes only. It is not legal advice and should not be used in place of legal advice.

Stuart Lieberman, Esq., and IRED.Com, Inc., will not accept any responsibilty for any reliance on the information in this column or any damages whatsoever resulting from reading this column.