[Real Property] Loretto, LAWRENCE

[강석근]

Loretto v. Teleprompter Manhattan Catv Corp.

Supreme Court of the United States, 1982

LORETTO v. TELEPROMPTER MANHATTAN CATV CORP. ET AL.

Opinion

 [*421]  [***873]  [**3168]  JUSTICE MARSHALL delivered the opinion of the Court.

LEdHN[1A] [1A]This case presents the question whether a minor but permanent physical occupation of an owner's property authorized by government constitutes a "taking" of property for which just compensation is due under the Fifth and Fourteenth Amendments of the Constitution. New York law provides that a landlord must permit a cable television company to install its cable facilities upon his property. N. Y. Exec. Law § 828(1) (McKinney Supp. 1981-1982). In this case, the cable installation occupied portions of appellant's roof and the side of her building. The New York Court of Appeals ruled that this appropriation does not amount to a taking. 53 N. Y. 2d 124, 423 N. E. 2d 320 (1981). Because we conclude that such a physical occupation of property is a taking, we reverse.

I

Appellant Jean Loretto purchased a five-story apartment building located at 303 West 105th Street, New York City, in 1971. The previous owner had granted appellees Teleprompter Corp.  [****7]  and Teleprompter Manhattan CATV (collectively Teleprompter) 1 permission to install a cable on the building and the exclusive privilege of furnishing cable  [*422]  television (CATV) services to the tenants. The New York Court of Appeals described the installation as follows:

"On June 1, 1970 TelePrompter installed a cable slightly less than one-half inch  [**3169]  in diameter and of approximately 30 feet in length along the length of the building about 18 inches above the roof top, and directional taps, approximately 4 inches by 4 inches by 4 inches, on the front and rear of the roof. By June 8, 1970 the cable had been extended another 4 to 6 feet and cable had been run from the directional taps to the adjoining building at 305 West 105th Street." Id., at 135, 423 N. E. 2d, at 324.

Teleprompter also installed two large silver boxes along the roof cables. The cables are attached by screws or nails penetrating the masonry at approximately two-foot intervals, and other equipment is installed by bolts.

 [****8]  Initially, Teleprompter's roof cables did not service appellant's building. They were part of what could be described as a cable "highway" circumnavigating the city block, with service cables periodically dropped over the front or back of a building  [***874]  in which a tenant desired service. Crucial to such a network is the use of so-called "crossovers" -- cable lines extending from one building to another in order to reach a new group of tenants. 2 Two years after appellant purchased the building, Teleprompter connected a "noncrossover" line -- i. e., one that provided CATV service to appellant's own tenants -- by dropping a line to the first floor down the front of appellant's building.

 [****9]  [*423]  Prior to 1973, Teleprompter routinely obtained authorization for its installations from property owners along the cable's route, compensating the owners at the standard rate of 5% of the gross revenues that Teleprompter realized from the particular property. To facilitate tenant access to CATV, the State of New York enacted § 828 of the Executive Law, effective January 1, 1973. Section 828 provides that a landlord may not "interfere with the installation of cable television facilities upon his property or premises," and may not demand payment from any tenant for permitting CATV, or demand payment from any CATV company "in excess of any amount which the [State Commission on Cable Television] shall, by regulation, determine to be reasonable." 3 The landlord may, however, require the CATV company or the tenant to bear the cost of installation and to indemnify for any damage caused by the installation. Pursuant to § 828(1)(b), the State Commission has ruled that a one-time $ 1 payment  [*424]  is the normal fee to which a landlord is entitled. In the Matter of Implementation of Section 828 of the Executive Law, No. 90004, Statement of General Policy (New York [****10]  State Commission on Cable Television, Jan. 15, 1976) (Statement of  [**3170]  General Policy), App. 51-52; Clarification of General Policy (Aug. 27, 1976), App. 68-69. The Commission ruled that this nominal fee, which the Commission concluded was equivalent to what the landlord would receive if the property were condemned pursuant to New York's Transportation Corporations  [***875]  Law, satisfied constitutional requirements "in the absence of a special showing of greater damages attributable to the taking." Statement of General Policy, App. 52.

 [****11]  Appellant did not discover the existence of the cable until after she had purchased the building. She brought a class action against Teleprompter in 1976 on behalf of all owners of real property in the State on which Teleprompter has placed CATV components, alleging that Teleprompter's installation was a trespass and, insofar as it relied on § 828, a taking without just compensation. She requested damages and injunctive relief. 4 Appellee City of New York, which has granted Teleprompter an exclusive franchise to provide CATV within certain areas of Manhattan, intervened. The Supreme Court, Special Term, granted summary judgment to Teleprompter and the city, upholding the constitutionality of § 828 in both crossover and noncrossover situations. 98 Misc. 2d 944, 415 N. Y. S. 2d 180 (1979). The Appellate Division affirmed without opinion. 73 App. Div. 2d 849, 422 N. Y. S. 2d 550 (1979).

 [****12]  On appeal, the Court of Appeals, over dissent, upheld the statute. 53 N. Y. 2d 124, 423 N. E. 2d 320 (1981). The court concluded that the law requires the landlord to allow both crossover and noncrossover installations but permits him to  [*425]  request payment from the CATV company under § 828(1)(b), at a level determined by the State Cable Commission, only for noncrossovers. The court then ruled that the law serves a legitimate police power purpose -- eliminating landlord fees and conditions that inhibit the development of CATV, which has important educational and community benefits. Rejecting the argument that a physical occupation authorized by government is necessarily a taking, the court stated that the regulation does not have an excessive economic impact upon appellant when measured against her aggregate property rights, and that it does not interfere with any reasonable investment-backed expectations. Accordingly, the court held that § 828 does not work a taking of appellant's property. Chief Judge Cooke dissented, reasoning that the physical appropriation of a portion of appellant's property is a taking without regard to the balancing analysis courts [****13]  ordinarily employ in eval‎uating whether a regulation is a taking.

In light of its holding, the Court of Appeals had no occasion to determine whether the $ 1 fee ordinarily awarded for a noncrossover installation was adequate compensation for the taking. Judge Gabrielli, concurring, agreed with the dissent that the law works a taking but concluded that the $ 1 presumptive award, together with the procedures permitting a landlord to demonstrate a greater entitlement, affords just compensation. We noted probable jurisdiction. 454 U.S. 938 (1981).

II

LEdHN[2] [2]The Court of Appeals determined that § 828 serves the legitimate public purpose of "rapid development  [***876]  of and maximum penetration by a means of communication which has important educational and community aspects," 53 N. Y. 2d, at 143-144, 423 N. E. 2d, at 329, and thus is within the State's police power. We have no reason to question that determination. It is a separate question, however, whether an otherwise valid regulation so frustrates property rights that compensation must be paid. See Penn Central Transportation [****14]   [*426]  Co. v. New York City, 438 U.S. 104, 127-128  [**3171]  (1978);Delaware, L. & W. R. Co. v. Morristown, 276 U.S. 182, 193 (1928).We conclude that a permanent physical occupation authorized by government is a taking without regard to the public interests that it may serve. Our constitutional history confirm‎s the rule, recent cases do not question it, and the purposes of the Takings Clause compel its retention.

A

LEdHN[3] [3]In Penn Central Transportation Co. v. New York City, supra, the Court surveyed some of the general principles governing the Takings Clause. The Court noted that no "set formula" existed to determine, in all cases, whether compensation is constitutionally due for a government restriction of property. Ordinarily, the Court must engage in "essentially ad hoc, factual inquiries." Id., at 124.But the inquiry is not standardless. The economic impact of the regulation, especially the degree of interference with investment-backed expectations, is of particular significance. "So, too, is the character [****15]  of the governmental action. A 'taking' may more readily be found when the interference with property can be characterized as a physical invasion by government, than when interference arises from some public program adjusting the benefits and burdens of economic life to promote the common good." Ibid. (citation omitted).

LEdHN[4] [4]As Penn Central affirms, the Court has often upheld substantial regulation of an owner's use of his own property where deemed necessary to promote the public interest. At the same time, we have long considered a physical intrusion by government to be a property restriction of an unusually serious character for purposes of the Takings Clause. Our cases further establish that when the physical intrusion reaches the extreme form of a permanent physical occupation, a taking has occurred. In such a case, "the character of the government action" not only is an important factor in resolving whether the action works a taking but also is determinative.

 [*427]  When faced with a constitutional challenge to a permanent physical occupation of real property, this Court has invariably [****16]  found a taking. 5 As early as 1872, in Pumpelly v.  [***877]  Green Bay Co., 13 Wall. 166, this Court held that the defendant's construction, pursuant to state authority, of a dam which permanently flooded plaintiff's property constituted a taking. A unanimous Court stated, without qualification, that "where real estate is actually invaded by superinduced additions of water, earth, sand, or other material, or by having any artificial structure placed on it, so as to effectually destroy or impair its usefulness, it is a taking, within the meaning  [**3172]  of the Constitution." Id., at 181. Seven years later, the Court reemphasized the importance of a physical occupation by distinguishing a regulation that merely restricted the use of private property. In Northern Transportation Co. v. Chicago, 99 U.S. 635 (1879), the Court held that the city's construction  [*428]  of a temporary dam in a river to permit construction of a tunnel was not a taking, even though the plaintiffs were thereby denied access to their premises, because the obstruction only impaired the use of plaintiffs' property. The Court distinguished [****17]  earlier cases in which permanent flooding of private property was regarded as a taking, e. g., Pumpelly, supra, as involving "a physical invasion of the real estate of the private owner, and a practical ouster of his possession." In this case, by contrast, "[no] entry was made upon the plaintiffs' lot." 99 U.S., at 642.

 [****18]  Since these early cases, this Court has consistently distinguished between flooding cases involving a permanent physical occupation, on the one hand, and cases involving a more temporary invasion, or government action outside the owner's property that causes consequential damages within, on the other. A taking has always been found only in the former situation. See United States v. Lynah, 188 U.S. 445, 468-470 (1903); Bedford v. United States, 192 U.S. 217, 225 (1904); United States v. Cress, 243 U.S. 316, 327-328 (1917); Sanguinetti v. United States, 264 U.S. 146, 149 (1924) (to be a taking, flooding must "constitute an actual, permanent invasion of the land, amounting to an appropriation of, and not merely an injury to, the property"); United States v. Kansas City Life Ins. Co., 339 U.S. 799, 809-810 (1950).

In St. Louis v. Western Union Telegraph Co., 148 U.S. 92 (1893), the Court applied the principles enunciated in Pumpelly  [***878]  to a situation closely analogous to the one presented today. In that case, the Court held that the city [****19]  of St. Louis could exact reasonable compensation for a telegraph company's placement of telegraph poles on the city's public streets. The Court reasoned:

"The use which the [company] makes of the streets is an exclusive and permanent one, and not one temporary, shifting and in common with the general public. The ordinary traveler, whether on foot or in a vehicle, passes to and fro along the streets, and his use and occupation  [*429]  thereof are temporary and shifting. The space he occupies one moment he abandons the next to be occupied by any other traveller. . . . But the use made by the telegraph company is, in respect to so much of the space as it occupies with its poles, permanent and exclusive. It as effectually and permanently dispossesses the general public as if it had destroyed that amount of ground. Whatever benefit the public may receive in the way of transportation of messages, that space is, so far as respects its actual use for purposes of highway and personal travel, wholly lost to the public. . . .

. . . .

". . . It matters not for what that exclusive appropriation is taken, whether for steam railroads or street railroads, telegraphs or telephones,  [****20]  the state may if it chooses exact from the party or corporation given such exclusive use pecuniary compensation to the general public for being deprived of the common use of the portion thus appropriated." Id., at 98-99, 101-102 (emphasis added). 6

 [****21]   [**3173]  Similarly, in Western Union Telegraph Co. v. Pennsylvania R. Co., 195 U.S. 540 (1904), a telegraph company constructed and operated telegraph lines over a railroad's right of way. In holding that federal law did not grant the company the right of eminent domain or the right to operate the lines absent the railroad's consent, the Court assumed that  [*430]  the invasion of the telephone lines would be a compensable taking. Id., at 570 (the right-of-way "cannot be appropriated in whole or in part except upon the payment of compensation"). Later cases, relying on the character of a physical occupation, clearly establish that HN2 permanent occupations of land by such installations as telegraph and telephone lines, rails, and underground pipes or wires are takings even if they occupy only relatively insubstantial amounts of space and do not seriously interfere with the landowner's use of the rest of his land. See, e. g., Lovett v. West Va. Central Gas Co., 65 W. Va. 739, 65 S. E. 196 (1909); Southwestern Bell Telephone  [****22]  Co. v. Webb, 393 S. W. 2d 117, 121 (Mo. App. 1965). Cf. Portsmouth Harbor  [***879]  Land & Hotel Co. v. United States, 260 U.S. 327 (1922). See generally 2 J. Sackman, Nichols' Law of Eminent Domain § 6.21 (rev. 3d ed. 1980). 7

More recent cases confirm‎ the distinction between a permanent physical occupation, [****23]  a physical invasion short of an occupation, and a regulation that merely restricts the use of property. In United States v. Causby, 328 U.S. 256 (1946), the Court ruled that frequent flights immediately above a landowner's property constituted a taking, comparing such overflights to the quintessential form of a taking:

"If, by reason of the frequency and altitude of the flights, respondents could not use this land for any purpose, their loss would be complete. It would be as complete as if the United States had entered upon the surface of the land and taken exclusive possession of it." Id., at 261 (footnote omitted).

 [*431]  As the Court further explained,

"We would not doubt that, if the United States erected an elevated railway over respondents' land at the precise altitude where its planes now fly, there would be a partial taking, even though none of the supports of the structure rested on the land. The reason is that there would be an intrusion so immediate and direct as to subtract from the owner's full enjoyment of the property and to limit his exploitation of it." Id., at 264-265.

The Court [****24]  concluded that the damages to the respondents "were not merely consequential. They were the product of a direct invasion of respondents' domain." Id., at 265-266. See also Griggs v. Allegheny County, 369 U.S. 84 (1962).

Two wartime takings cases are also instructive. In United States v. Pewee Coal Co., 341 U.S. 114 (1951), the Court unanimously held that the Government's seizure and direction of operation of a coal mine to prevent a national strike of coal miners constituted a taking,  [**3174]  though members of the Court differed over which losses suffered during the period of Government control were compensable. The plurality had little difficulty concluding that because there had been an "actual taking of possession and control," the taking was as clear as if the Government held full title and ownership. Id., at 116 (plurality opinion of Black, J., with whom Frankfurter, Douglas, and Jackson, JJ., joined; no other Justice challenged this portion of the opinion). In United States v. Central Eureka Mining Co., 357 U.S. 155 (1958), by contrast, the Court found no taking  [***880]   [****25]  where the Government had issued a wartime order requiring nonessential gold mines to cease operations for the purpose of conserving equipment and manpower for use in mines more essential to the war effort. Over dissenting Justice Harlan's complaint that "as a practical matter the Order led to consequences no different from those that would have followed the temporary acquisition of physical possession of these mines by the United States," id., at 181, the Court reasoned that "the Government did not occupy,  [*432]  use, or in any manner take physical possession of the gold mines or of the equipment connected with them." Id., at 165-166. The Court concluded that the temporary though severe restriction on use of the mines was justified by the exigency of war. 8 Cf. YMCA v. United States, 395 U.S. 85, 92 (1969) ("Ordinarily, of course, government occupation of private property deprives the private owner of his use of the property, and it is this deprivation for which the Constitution requires compensation").

 [****26]  LEdHN[5] [5]Although this Court's most recent cases have not addressed the precise issue before us, they have emphasized that physical invasion cases are special and have not repudiated the rule that any permanent physical occupation is a taking. The cases state or imply that a physical invasion is subject to a balancing process, but they do not suggest that a permanent physical occupation would ever be exempt from the Takings Clause.

LEdHN[6A] [6A]Penn Central Transportation Co. v. New York City, as noted above, contains one of the most complete discussions of the Takings Clause. The Court explained that resolving whether public action works a taking is ordinarily an ad hoc inquiry in which several factors are particularly significant -- the economic impact of the regulation, the extent to which it interferes with investment-backed expectations, and the character of the governmental action. 438 U.S., at 124.The opinion does not repudiate the rule that a permanent physical occupation is a government action of such [****27]  a unique character that it is a taking without regard to other factors that a court might ordinarily examine. 9

LEdHN[6B] [6B]

 [****28]   [*433]  In Kaiser Aetna v. United States, 444 U.S. 164 (1979), the Court held that the Government's imposition of a  [***881]  navigational servitude requiring public access to a pond was a taking where the landowner had reasonably relied on Government consent in connecting the pond to navigable water. The Court emphasized that the servitude took  [**3175]  HN3 the land-owner's right to exclude, "one of the most essential sticks in the bundle of rights that are commonly characterized as property." Id., at 176. The Court explained:

"This is not a case in which the Government is exercising its regulatory power in a manner that will cause an insubstantial deval‎uation of petitioner's private property; rather, the imposition of the navigational servitude in this context will result in an actual physical invasion of the privately owned marina. . . . And even if the Government physically invades only an easement in property, it must nonetheless pay compensation. See United States v. Causby, 328 U.S. 256, 265 (1946); Portsmouth Co. v. United States, 260 U.S. 327 (1922)." Id., at 180 (emphasis [****29]  added).

Although the easement of passage, not being a permanent occupation of land, was not considered a taking per se, Kaiser Aetna reemphasizes that a physical invasion is a government intrusion of an unusually serious character. 10

 [*434]  Another recent case underscores the constitutional distinction between a permanent occupation [****30]  and a temporary physical invasion. In PruneYard Shopping Center v. Robins, 447 U.S. 74 (1980), the Court upheld a state constitutional requirement that shopping center owners permit individuals to exercise free speech and petition rights on their property, to which they had already invited the general public. The Court emphasized that the State Constitution does not prevent the owner from restricting expressive activities by imposing reasonable time, place, and manner restrictions to minimize interference with the owner's commercial functions. Since the invasion was temporary and limited in nature, and since the owner had not exhibited an interest in excluding all persons from his property, "the fact that [the solicitors] may have 'physically invaded' [the owners'] property cannot be viewed as determinative." Id., at 84. 11

 [****31]  In  [***882]  short, HN4 when the "character of the governmental action," Penn Central, 438 U.S., at 124, is a permanent physical occupation of property, our cases uniformly have found a taking to the extent of the occupation, without regard to  [*435]  whether the action achieves an important public benefit or has only minimal economic impact on the owner.

B

The historical rule that a permanent physical occupation of another's property is a taking has more than tradition to commend it. Such an appropriation is perhaps  [**3176]  the most serious form of invasion of an owner's property interests. To borrow a metaphor, cf. Andrus v. Allard, 444 U.S. 51, 65-66 (1979), the government does not simply take a single "strand" from the "bundle" of property rights: it chops through the bundle, taking a slice of every strand.

LEdHN[7] [7]LEdHN[8A] [8A]HN5 Property rights in a physical thing have been described as the rights [****32]  "to possess, use and dispose of it." United States v. General Motors Corp., 323 U.S. 373, 378 (1945). To the extent that the government permanently occupies physical property, it effectively destroys each of these rights. 

First, the owner has no right to possess the occupied space himself, and also has no power to exclude the occupier from possession and use of the space. The power to exclude has traditionally been considered one of the most treasured strands in an owner's bundle of property rights. 12 See Kaiser Aetna,  [*436]  444 U.S., at 179-180; see also Restatement of Property § 7 (1936). 

Second, the permanent physical occupation of property forever denies the owner any power to control the use of the property; he not only cannot exclude others, but can make no nonpossessory use of the property. Although deprivation of the right to use and obtain a profit from property is not, in every case, independently sufficient to establish a taking, see Andrus v. Allard, supra, at 66, it is clearly relevant. 

Finally, even though the owner may retain the bare legal right to dispose of the occupied  [***883]  space [****33]  by transfer or sale, the permanent occupation of that space by a stranger will ordinarily empty the right of any value, since the purchaser will also be unable to make any use of the property.

LEdHN[8B] [8B]

 [****34]  Moreover, an owner suffers a special kind of injury when a stranger directly invades and occupies the owner's property. As Part II-A, supra, indicates, property law has long protected an owner's expectation that he will be relatively undisturbed at least in the possession of his property. To require, as well, that the owner permit another to exercise complete dominion literally adds insult to injury. See Michelman, Property, Utility, and Fairness: Comments on the Ethical Foundations of "Just Compensation" Law, 80 Harv. L. Rev. 1165, 1228, and n. 110 (1967). Furthermore, such an occupation is qualitatively more severe than a regulation of the use of property, even a regulation that imposes affirmative duties on the owner, since the owner may have no control over the timing, extent, or nature of the invasion. See n. 19, infra.

LEdHN[9] [9]The traditional rule also avoids otherwise difficult line-drawing problems. Few would disagree that if the State required landlords to permit third parties to install swimming pools on the landlords' rooftops for the convenience of the tenants, the [****35]  requirement would be a taking. If the cable installation here occupied as much space, again, few would disagree that the occupation would be a taking. But constitutional protection for the rights of private property cannot be made to depend on the  [**3177]  size of the area permanently occupied. 13 [****36]   [*437]  Indeed, it is possible that in the future, additional cable installations that more significantly restrict a landlord's use of the roof of his building will be made. Section 828 requires a landlord to permit such multiple installations. 14

LEdHN[10] [10]Finally, whether a permanent physical occupation has occurred presents relatively few problems of proof. The placement of a fixed structure on land or real property is an obvious fact that will rarely be subject to dispute. Once the fact of occupation is shown, of course, a court should consider the extent of the occupation as one relevant factor in determining the compensation  [***884]  due. 15 For that reason, moreover, there is  [*438]  less need to consider the extent of the occupation in determining whether there is a taking in the first instance.

 [****37]  C

LEdHN[1B] [1B] LEdHN[11A] [11A]Teleprompter's cable installation on appellant's building constitutes a taking under the traditional test. The installation 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. 16

LEdHN[11B] [11B]

 [****38]  In light of our analysis, we find no constitutional difference between a crossover  [**3178]  and a noncrossover installation. The portions of the installation necessary for both crossovers and noncrossovers permanently appropriate appellant's property. Accordingly, each type of installation is a taking.

Appellees raise a series of objections to application of the traditional rule here. Teleprompter notes that the law applies only to buildings used as rental property, and draws the  [*439]  conclusion that the law is simply a permissible regulation of the use of real property. We fail to see, however, why a physical occupation of one type of property but not another type is any less a physical occupation. Insofar as Teleprompter means to suggest that this is not a permanent physical invasion, we must differ. So long as the property remains residential and a CATV company wishes to retain the installation, the landlord must permit it. 17

 [****39]  LEdHN[12] [12]Teleprompter  [***885]  also asserts the related argument that the State has effectively granted a tenant the property right to have a CATV installation placed on the roof of his building, as an appurtenance to the tenant's leasehold. The short answer is that § 828(1)(a) does not purport to give the tenant any enforceable property rights with respect to CATV installation, and the lower courts did not rest their decisions on this ground. 18 Of course, Teleprompter, not appellant's tenants, actually owns the installation. Moreover, the government does not have unlimited power to redefine property rights. See Webb's Fabulous Pharmacies, Inc. v. Beckwith, 449 U.S. 155, 164 (1980) ("a State, by ipse dixit, may not transform private property into public property without compensation").

 [****40] 

 [*440]  LEdHN[13] [13]Finally, we do not agree with appellees that application of the physical occupation rule will have dire consequences for the government's power to adjust landlord-tenant relationships. This Court has consistently affirmed that States have broad power to regulate housing conditions in general and the landlord-tenant relationship in particular without paying compensation for all economic injuries that such regulation entails. See, e. g., Heart of Atlanta Motel, Inc. v. United States, 379 U.S. 241 (1964) (discrimination in places of public accommodation); Queenside Hills Realty Co. v. Saxl, 328 U.S. 80 (1946) (fire regulation); Bowles v. Willingham, 321 U.S. 503 (1944) (rent control); Home Building & Loan Assn. v. Blaisdell, 290 U.S. 398 (1934) (mortgage moratorium); Edgar A. Levy Leasing Co. v. Siegel, 258 U.S. 242 (1922) (emergency housing law); Block v. Hirsh, 256 U.S. 135 (1921) (rent control). In none of these cases, however, did the government authorize [****41]  the permanent occupation of the landlord's property by a third party. Consequently, our holding today in no way alters the analysis governing the State's power to require landlords to comply with building codes and provide utility connections, mailboxes, smoke detectors, fire extinguishers, and the like in the common area of a building. So long as these regulations do not require the landlord to suffer the physical occupation of a portion of his  [**3179]  building by a third party, they will be analyzed under the multifactor inquiry generally applicable to nonpossessory governmental activity. See Penn Central Transportation Co. v. New York City, 438 U.S. 104 (1978). 19

 [****42]  [*441]  III

 [***886]  LEdHN[1C] [1C]Our holding today is very narrow. We affirm the traditional rule that a permanent physical occupation of property is a taking. In such a case, the property owner entertains a historically rooted expectation of compensation, and the character of the invasion is qualitatively more intrusive than perhaps any other category of property regulation. We do not, however, question the equally substantial authority upholding a State's broad power to impose appropriate restrictions upon an owner's use of his property.

LEdHN[14] [14]Furthermore, our conclusion that § 828 works a taking of a portion of appellant's property does not presuppose that the fee which many landlords had obtained from Teleprompter prior to the law's enactment is a proper measure of the value of the property taken. The issue of the amount of compensation that is due, on which we express no opinion, is a matter for the state courts to consider on remand. 20

 [****43]  [*442]  The judgment of the New York Court of Appeals is reversed, and the case is remanded for further proceedings not inconsistent with this opinion.

It is so ordered.

Dissent by: BLACKMUN

Dissent

JUSTICE BLACKMUN, with whom JUSTICE BRENNAN and JUSTICE WHITE join, dissenting.

If the Court's decisions construing the Takings Clause state anything clearly, it is that "[there] is no set formula to determine where regulation ends and taking begins." Goldblatt v. Town of Hempstead, 369 U.S. 590, 594 (1962). 1

 [****44]  In a curiously anachronistic decision,  [***887]  the Court today acknowledges its historical disavowal of set formulae in almost the same breath as it constructs a rigid per se takings  [**3180]  rule: "a permanent physical occupation authorized by government is a taking without regard to the public interests that it may serve." Ante, at 426. To sustain its rule against our recent precedents, the Court erects a strained and untenable distinction between "temporary physical invasions," whose constitutionality concededly "is subject to a balancing process," and "permanent physical occupations," which are "[takings] without regard to other factors that a court might ordinarily examine." Ante, at 432.

In my view, the Court's approach "reduces the constitutional issue to a formalistic quibble" over whether property has been "permanently occupied" or "temporarily invaded." Sax, Takings and the Police Power, 74 Yale L.J. 36, 37  [*443]  (1964). The Court's application of its formula to the facts of this case vividly illustrates that its approach is potentially dangerous as well as misguided. Despite its concession that "States have broad power to regulate [****45]  . . . the landlord-tenant relationship . . . without paying compensation for all economic injuries that such regulation entails," ante, at 440, the Court uses its rule to undercut a carefully considered legislative judgment concerning landlord-tenant relationships. I therefore respectfully dissent.

I

Before examining the Court's new takings rule, it is worth reviewing what was "taken" in this case. At issue are about 36 feet of cable one-half inch in diameter and two 4' x 4' x 4' metal boxes. Jointly, the cable and boxes occupy only about one-eighth of a cubic foot of space on the roof of appellant's Manhattan apartment building. When appellant purchased that building in 1971, the "physical invasion" she now challenges had already occurred. 2 Appellant did not bring this action until about five years later, demanding 5% of appellee Teleprompter's gross revenues from her building, and claiming that the operation of N. Y. Exec. Law § 828 (McKinney  [*444]  Supp. 1981-1982) "took" her property. The New York Supreme Court, the Appellate Division, and the New York Court of Appeals all rejected that claim, upholding § 828 as a valid exercise of the State's police power.  [****46] 

 [***888]  The Court [****47]  of Appeals held that:

"the State may proscribe a trespass action by landlords generally against a cable TV company which places a cable and other fixtures on the roof of any landlord's building, in order to protect the right of the tenants of rental property, who will ultimately have to pay any charge a landlord is permitted to collect from the cable TV company, to obtain TV service in their respective apartments." 53 N. Y. 2d 124, 153, 423 N. E. 2d 320, 335 (1981).

In so ruling, the court applied the multifactor balancing test prescribed by this Court's recent Takings Clause decisions. Those decisions teach that takings questions should be resolved through "essentially ad hoc, factual inquiries," Kaiser Aetna v. United States, 444 U.S. 164, 175 (1979), into "such factors as the character of the governmental action, its economic impact, and its interference with reasonable investment-backed expectations." PruneYard Shopping Center v. Robins, 447 U.S. 74, 83  [**3181]  (1980). See 53 N. Y. 2d, at 144-151, 423 N. E. 2d, at 330-334.

The Court of Appeals found, first, that § 828 represented a reasoned [****48]  legislative effort to arbitrate between the interests of tenants and landlords and to encourage development of an important educational and communications medium. 3 [****49]  Id., at  [*445]  143-145, 423 N. E. 2d, at 329-330. Moreover, under PruneYard Shopping Center v. Robins, 447 U.S., at 83-84, the fact that § 828 authorized Teleprompter to make a minor physical intrusion upon appellant's property was in no way determinative of the takings question. 53 N. Y. 2d, at 146-147, 423 N. E. 2d, at 331. 4

Second, the court concluded that the statute's economic impact on appellant was de minimis because  [***889]  § 828 did not affect the fair return on her property. 53 N. Y. 2d, at 148-150, 423 N. E. 2d, at 332-333. Third, the statute did not interfere with appellant's [****50]  reasonable investment-backed expectations. Id., at 150-151, 423 N. E. 2d, at 333-334. When appellant purchased the building, she was unaware of the existence of the cable. See n. 2, supra. Thus, she could not have invested in the building with any reasonable expectation that the one-eighth cubic foot of space occupied by the cable television installment would become income-productive. 53 N. Y. 2d, at 155, 423 N. E. 2d, at 336.

 [*446]  II

Given that the New York Court of Appeals' straightforward application of this Court's balancing test yielded a finding of no taking, it becomes clear why the Court now constructs a per se rule to reverse. The Court can escape the result dictated by our recent takings cases only by resorting to bygone precedents and arguing that "permanent physical occupations" somehow differ qualitatively from all other forms of government regulation.

The Court argues that a per se rule based on "permanent physical occupation" is both historically rooted, see ante, at 426-435, and jurisprudentially sound, see ante, at 435-438. I disagree in both respects. The 19th-century precedents relied on by the Court [****51]  lack any vitality outside the agrarian context in which they  [**3182]  were decided. 5 But if, by chance, they  [*447]  have any lingering vitality, then, in my view, those cases stand for a constitutional rule that is uniquely unsuited to the modern urban age. Furthermore, I find logically untenable the Court's assertion that § 828 must be analyzed under a per se rule because it "effectively destroys" three of "the most treasured strands in an owner's bundle of property rights," ante, at 435.

 [****52]  A

The Court's recent Takings Clause decisions teach that nonphysical government intrusions on private property, such as zoning ordinances and other land-use restrictions, have become  [***890]  the rule rather than the exception. Modern government regulation exudes intangible "externalities" that may diminish the value of private property far more than minor physical touchings. Nevertheless, as the Court recognizes, it has "often upheld substantial regulation of an owner's use of his own property where deemed necessary to promote the public interest." Ante, at 426. See, e. g., Agins v. City of Tiburon, 447 U.S. 255 (1980); Penn Central Transportation Co. v. New York City, 438 U.S. 104, 124-125 (1978); Village of Euclid v. Ambler Realty Co., 272 U.S. 365 (1926).

Precisely because the extent to which the government may injure private interests now depends so little on whether or not it has authorized a "physical contact," the Court has avoided per se takings rules resting on outmoded distinctions between physical and nonphysical intrusions. As one commentator has observed, a takings rule based on such [****53]  a distinction is inherently suspect because "its capacity to distinguish, even crudely, between significant and insignificant losses is too puny to be taken seriously." Michelman, Property, Utility, and Fairness: Comments on the Ethical Foundations of "Just Compensation" Law, 80 Harv. L. Rev. 1165, 1227 (1967).

Surprisingly, the Court draws an even finer distinction today -- between "temporary physical invasions" and "permanent  [*448]  physical occupations." When the government authorizes the latter type of intrusion, the Court would find "a taking without regard to the public interests" the regulation may serve. Ante, at 426. Yet an examination of each of the three words in the Court's "permanent physical occupation" formula illustrates that the newly created distinction is even less substantial than the distinction between physical and nonphysical intrusions that the Court already has rejected.

First, what does the Court mean by "permanent"? Since all "temporary limitations on the right to exclude" remain "subject to a more complex balancing process to determine whether they are a taking," ante, at 435, n. 12, the Court presumably describes  [**3183]   [****54]  a government intrusion that lasts forever. But as the Court itself concedes, § 828 does not require appellant to permit the cable installation forever, but only "[so] long as the property remains residential and a CATV company wishes to retain the installation." Ante, at 439. This is far from "permanent."

The Court reaffirms that "States have broad power to regulate housing conditions in general and the landlord-tenant relationship in particular without paying compensation for all economic injuries that such regulation entails." Ante, at 440. Thus, § 828 merely defines one of the many statutory responsibilities that a New Yorker accepts when she enters the rental business. If appellant occupies her own building, or converts it into a commercial property, she becomes perfectly free to exclude Teleprompter from her one-eighth cubic foot of roof space. But once appellant chooses to use her property for rental purposes, she must comply with all reasonable government statutes  [***891]  regulating the landlord-tenant relationship. 6 [****56]  If § 828 authorizes a "permanent" occupation,  [*449]  and thus works a taking "without regard to the public interests that it may serve,  [****55]  " then all other New York statutes that require a landlord to make physical attachments to his rental property also must constitute takings, even if they serve indisputably valid public interests in tenant protection and safety. 7

 [****57]  The Court denies that its theory invalidates these statutes, because they "do not require the landlord to suffer the physical occupation of a portion of his building by a third party." Ante, at 440. But surely this factor cannot be determinative, since the Court simultaneously recognizes that temporary  [*450]  invasions by third parties are not subject to a per se rule. Nor can the qualitative difference arise from the incidental fact that, under § 828, Teleprompter, rather than appellant or her tenants, owns the cable installation. Cf. ante, at 440, and n. 19. If anything, § 828 leaves appellant better off than do other housing statutes, since it ensures that her property will not be damaged esthetically or physically, see n. 4, supra, without burdening her with the cost of buying or maintaining the cable.

 [**3184]  In any event, under the Court's test, the "third party" problem would remain even if appellant herself owned the cable. So long as Teleprompter continuously passed its electronic signal through the cable, a litigant could argue that the second element of the Court's formula -- a "physical touching" by a stranger -- was satisfied and that  [****58]   [***892]  § 828 therefore worked a taking. 8 Literally read, the Court's test opens the door to endless metaphysical struggles over whether or not an individual's property has been "physically" touched. It was precisely to avoid "[permitting] technicalities of form to dictate consequences of substance," United States v. Central Eureka Mining Co., 357 U.S. 155, 181 (1958) (Harlan, J., dissenting), that the Court abandoned a "physical contacts" test in the first place.

 [****59]  Third, the Court's talismanic distinction between a continuous "occupation" and a transient "invasion" finds no basis in either economic logic or Takings Clause precedent. In the landlord-tenant context, the Court has upheld against takings challenges rent control statutes permitting "temporary"  [*451]  physical invasions of considerable economic magnitude. See, e. g., Block v. Hirsh, 256 U.S. 135 (1921) (statute permitting tenants to remain in physical possession of their apartments for two years after the termination of their leases). Moreover, precedents record numerous other "temporary" officially authorized invasions by third parties that have intruded into an owner's enjoyment of property far more deeply than did Teleprompter's long-unnoticed cable. See, e. g., PruneYard Shopping Center v. Robins, 447 U.S. 74 (1980) (leafletting and demonstrating in busy shopping center); Kaiser Aetna v. United States, 444 U.S. 164 (1979) (public easement of passage to private pond); United States v. Causby, 328 U.S. 256 (1946) (noisy airplane flights over private land). While, under the Court's [****60]  balancing test, some of these "temporary invasions" have been found to be takings, the Court has subjected none of them to the inflexible per se rule now adapted to analyze the far less obtrusive "occupation" at issue in the present case. Cf. ante, at 430-431, 432-435.

In sum, history teaches that takings claims are properly eval‎uated under a multifactor balancing test. By directing that all "permanent physical occupations" automatically are compensable, "without regard to whether the action achieves an important public benefit or has only minimal economic impact on the owner," ante, at 434-435, the Court does not further equity so much as it encourages litigants to manipulate their factual allegations to gain the benefit of its per se rule. Cf. n. 8, supra. I do not relish the prospect of distinguishing the inevitable flow of certiorari petitions attempting to shoehorn insubstantial takings claims into today's "set formula."

B

Setting aside history, the Court also states that the permanent physical occupation authorized by § 828 is a per se taking because it uniquely impairs appellant's powers  [***893]  to dispose of, use, and exclude others from,  [****61]  her property. See ante, at  [*452]  435-438. In fact, the Court's discussion nowhere demonstrates how § 828 impairs these private rights in a manner qualitatively different from other garden-variety landlord-tenant legislation.

The Court first contends that the statute impairs appellant's legal right to dispose of cable-occupied space by transfer and sale. But that claim dissolves after a moment's  [**3185]  reflection. If someone buys appellant's apartment building, but does not use it for rental purposes, that person can have the cable removed, and use the space as he wishes. In such a case, appellant's right to dispose of the space is worth just as much as if § 828 did not exist.

Even if another landlord buys appellant's building for rental purposes, § 828 does not render the cable-occupied space valueless. As a practical matter, the regulation ensures that tenants living in the building will have access to cable television for as long as that building is used for rental purposes, and thereby likely increases both the building's resale value and its attractiveness on the rental market. 9

 [****62]  In any event, § 828 differs little from the numerous other New York statutory provisions that require landlords to install physical facilities "permanently occupying" common spaces in or on their buildings. As the Court acknowledges, the States traditionally -- and constitutionally -- have exercised their police power "to require landlords to . . . provide utility connections, mailboxes, smoke detectors, fire extinguishers, and the like in the common area of a building." Ante, at 440. Like § 828, these provisions merely ensure tenants access to services the legislature deems important, such as water, electricity, natural light, telephones, intercommunication systems, and mail service. See n. 7, supra. A landlord's dispositional rights are affected no more adversely  [*453]  when he sells a building to another landlord subject to § 828, than when he sells that building subject only to these other New York statutory provisions.

The Court also suggests that § 828 unconstitutionally alters appellant's right to control the use of her one-eighth cubic foot of roof space. But other New York multiple dwelling statutes not only oblige landlords to surrender significantly [****63]  larger portions of common space for their tenants' use, but also compel the landlord -- rather than the tenants or the private installers -- to pay for and to maintain the equipment. For example, New York landlords are required by law to provide and pay for mailboxes that occupy more than five times the volume that Teleprompter's cable occupies on appellant's building. See Tr. of Oral Arg. 42-43, citing N. Y. Mult. Dwell. Law § 57 (McKinney 1974). If the State constitutionally can insist that appellant make this sacrifice so that her tenants may receive mail, it is hard to understand why the State may not require her to surrender  [***894]  less space, filled at another's expense, so that those same tenants can receive television signals.

For constitutional purposes, the relevant question cannot be solely whether the State has interfered in some minimal way with an owner's use of space on her building. Any intelligible takings inquiry must also ask whether the extent of the State's interference is so severe as to constitute a compensable taking in light of the owner's alternative uses for the property. 10 Appellant freely admitted that she would have  [*454]   [****64]  had no other use for the cable-occupied space, were Teleprompter's equipment not on her building. See App. 97 (Deposition of Jean A. Loretto).

 [****65]  [**3186]  The Court's third and final argument is that § 828 has deprived appellant of her "power to exclude the occupier from possession and use of the space" occupied by the cable. Ante, at 435. This argument has two flaws. First, it unjustifiably assumes that appellant's tenants have no countervailing property interest in permitting Teleprompter to use that space. 11 Second, it suggests that the New York Legislature may not exercise its police power to affect appellant's common-law right to exclude Teleprompter even from one-eighth cubic foot of roof space. But this Court long ago recognized that new social circumstances can justify legislative modification of a property owner's common-law rights, without compensation, if the legislative action serves sufficiently important public interests. See Munn v. Illinois, 94 U.S. 113, 134 (1877) ("A person has no property, no vested interest, in any rule of the common law. . . . Indeed, the great office of statutes is to remedy defects in the common law as they are developed, and to adapt it to the changes of time and circumstance"); United States v. Causby, 328 U.S., at 260-261 [****66]  (In the modern world, "[common] sense revolts at the idea" that legislatures cannot alter common-law ownership rights).

 [*455]  As the Court of Appeals recognized, § 828 merely deprives appellant of a common-law trespass action  [***895]   [****67]  against Teleprompter, but only for as long as she uses her building for rental purposes, and as long as Teleprompter maintains its equipment in compliance with the statute. JUSTICE MARSHALL recently and most aptly observed:

"[Appellant's] claim in this case amounts to no less than a suggestion that the common law of trespass is not subject to revision by the State. . . . If accepted, that claim would represent a return to the era of Lochner v. New York, 198 U.S. 45 (1905), when common-law rights were also found immune from revision by State or Federal Government. Such an approach would freeze the common law as it has been constructed by the courts, perhaps at its 19th-century state of development. It would allow no room for change in response to changes in circumstance. The Due Process Clause does not require such a result." PruneYard Shopping Center v. Robins, 447 U.S., at 93 (concurring opinion).

III

In the end, what troubles me most about today's decision is that it represents an archaic judicial response to a modern social problem. Cable television is a new and growing, but somewhat controversial, communications medium.  [****68]  See Brief for New York State Cable Television Association as Amicus Curiae 6-7 (about 25% of American homes with televisions -- approximately 20 million families -- currently subscribe to cable television, with the penetration rate expected to double by 1990). The New York Legislature not only recognized, but also responded to, this technological advance by enacting a statute that sought carefully to balance the interests of all private parties. See nn. 3 and 4, supra. New York's courts in this litigation, with only one jurist in dissent, unanimously upheld the constitutionality of that considered legislative judgment.

 [*456]  This Court now reaches back in time for a per se rule that disrupts that legislative  [**3187]  determination. 12 Like Justice Black, I believe that "the solution of the problems precipitated by . . . technological advances and new ways of living cannot come about through the application of rigid constitutional restraints formulated and enforced by the courts." United States v. Causby, 328 U.S., at 274 (dissenting opinion). I would affirm the judgment and uphold the reasoning of the New York Court of Appeals.

LAWRENCE Beckett v. City of Paris Dry Goods Co

Supreme Court of California, 1939

LAWRENCE G. BECKETT, Plaintiff and Appellant, v. CITY OF PARIS DRY GOODS COMPANY (a Corporation), Defendant and Appellant

Disposition: 

Modified and affirme

Opinion

 [*635]  [**123]  In this case, the court is called upon to determine whether a contract made by the parties is a lease or only a license to occupy certain property. The plaintiff recovered damages for unlawful eviction, but the trial judge refused to allow certain amounts claimed and each of the parties has appealed from the judgment.

The defendant agreed in writing with the plaintiff, who is an optometrist, that the latter might, for a period of three years, conduct a first-class optical department in its large store. The space to be occupied at any time was to be designated by the defendant, which was to supply all light, heat, water, telephone and elevator service. Dr. Beckett [***2]  agreed to furnish equipment, fixtures and show-cases conforming in style and finish with those used in the store, and to pay it twenty per cent of his total monthly sales as consideration for the right to do business upon the conditions stated. It was further stipulated that all money taken in by Dr. Beckett should be deposited with the cashier of the City of Paris at the end of each day, and that the latter would later render a statement to him showing the balance of his account after deduction of amounts chargeable to him for rental, advertising, and uncollectible bills.

By the terms of the contract Dr. Beckett was required to purchase merchandise in his own name and upon his own credit, and he agreed to provide liability insurance indemnifying the store against liability arising because of his negligence or that of his employees. Other provisions are that he "cannot assign this lease or any interest therein" without the written consent of the dry goods company and that "on the last day of the term created hereby", he will "forthwith quietly and peaceably surrender and yield up unto the . . . [department store] any occupied premises".

 [*636]  Following the execution of [***3]  this agreement, Dr. Beckett took possession of several rooms designated by the City of Paris and occupied them for more than two years. The store then notified him that it was cancelling the agreement because of asserted violation of the provision requiring the deposit of receipts with its cashier, and it requested that he vacate on the evening of December 7th. This date was later postponed for three weeks, but immediately thereafter all of the plaintiff's instruments and merchandise were taken out of his rooms and he was excluded therefrom.

The department store contends that its agreement gave Dr. Beckett only a license to use the premises, and that the contract could, therefore, be terminated for just cause at any time. In support of its position, the defendant points out that no definite space was set apart for Dr. Beckett to occupy, and that it was given control of his business in matters of advertising policy and the keeping of accounts. By the terms of the contract, Dr. Beckett also agreed to discharge any employee who should "become objectionable" to the store. Under  [**124]  these circumstances, says the City of Paris, it is obvious that the parties intended the optical [***4]  department to be an integral part of the store which Dr. Beckett had only a license to manage and operate; hence it had the right to terminate that license at any time and to exclude him from the premises.

CA(1) (1) HN1 A lease is both a contract and a conveyance; under such an agreement there are rights and obligations based upon the relationship of landlord and tenant as well as upon the contractual promises. ( Realty & Rebuilding Co. v. Rea, 184 Cal. 565 [194 Pac. 1024]; Samuels v. Ottinger, 169 Cal. 209 [146 Pac. 638, Ann. Cas. 1916E, 830]; Tiffany, Landlord and Tenant, sec. 16.) It is well recognized that no particular legal terminology is required in the making of a lease, but it is essential that the instrument show an intention to establish the relationship of landlord and tenant. ( Baranov v. Scudder, 177 Cal. 458 [170 Pac. 1122]; Morris v. Iden, 23 Cal. App. 388 [138 Pac. 120].)

CA(2) (2) Although Dr. Beckett agreed to conduct his business in accordance with the policy of the store, to do his billing through the company's office, to discharge employees who were objectionable to the company, and to cooperate in other  [*637]  matters, there are other provisions [***5]  in the agreement which definitely point to an intention that the relationship between them should be that of lessor and lessee. For example, the agreement provides that "the designated space shall be delivered to second party in good, tenantable condition", and that Dr. Beckett shall have "the sole and exclusive right to conduct the optical department". It also bound Dr. Beckett, in terms common to leases, "to pay as a monthly rental a sum equivalent to twenty per cent (20%) of the total monthly sales of said department". Also, not only do the parties use the term "lease" in their agreement but the provision which forbids assignment without the consent of the department store is not applicable to HN2 a license, which is "a personal, revocable and unassignable permission to do one or more acts on the land of another without possessing any interest therein. . . . A license, because it is personal, is incapable of being assigned by the licensee". ( Eastman v. Piper, 68 Cal. App. 554 [229 Pac. 1002].)

Moreover, throughout the whole instrument, rights are given and language is used which definitely indicates that a lease was intended. HN3 The phrases "good, tenantable condition",  [***6]  "cannot assign this lease", "space demised", and "monthly rental" are the terminology of a lease. The use of these words is not conclusive of intention ( Morris v. Iden, supra) but strongly indicates that the parties contemplated such a relationship. Nor does the retention by the store of a certain amount of control over the management of the optical department, or the requirement that Dr. Beckett adhere to the rules and regulations governing its operations, negative this intention.

CA(3) (3) HN4 A lease must include a definite description of the property leased and an agreement for rental to be paid at particular times during a specified term. ( Losson v. Blodgett, 1 Cal. App. (2d) 13 [36 Pac. (2d) 147].) Yet, where one goes into possession of premises under a contract containing an ambiguous or uncertain description of property to be occupied and pays the stipulated rent, it will be enforced as a lease if the parties acted upon it as relating to particular premises. ( Baranov v. Scudder, supra; Merchants' Nat. Bank v. Weston, 34 Cal. App. 693 [168 Pac. 587].)

 [*638]  CA(4) (4) When the litigants made their contract, they stated only that "the space to be occupied by [***7]  said [optical] department at any time" was to be designated by the City of Paris, and "shall be delivered to . . . [Dr. Beckett] in good tenantable condition". This provision is not inconsistent with the requirements of a lease and in cases which have arisen under facts strikingly similar to those in the present controversy it has been held that HN5 an agreement under which an owner of real property allows another to conduct his own separate business in a stall or section of a store or lot creates the relationship of landlord and tenant rather than licensor and licensee. ( Herman v. Rohan, 37 Cal. App. 678 [174 Pac. 349]; Smith v. Royal Ins. Co., 93 Fed. (2d) 143; In re Owl Drug Co., 12 Fed. Supp. 439.)

CA(5) (5) Both parties agree that if the agreement is a lease, violations of the requirement for all money received to be turned in at the end of each day are not sufficient to justify a forfeiture of it. This is the correct construction of their contract and the plaintiff is, therefore, entitled to recover upon his cause of action for eviction.

 [**125]  CA(6) (6) Passing to a consideration of the points presented by Dr. Beckett upon his appeal from the judgment, he first challenges [***8]  the conclusion of the trial judge concerning the amount of his actual damages. It is undisputed that during the year immediately preceding his eviction, his average monthly earnings were $ 259.61. As he was evicted three months before the expiration of his lease, he is entitled to the sum of $ 778.83 for loss of profits instead of $ 666 allowed as actual damages. Also, the defendant does not deny that Dr. Beckett expended $ 35 for the removal of his furniture and equipment. This sum is recoverable by him. ( Klein v. Lewis, 41 Cal. App. 463 [182 Pac. 789].)

CA(7) (7) Another contention of Dr. Beckett is that he is entitled to damages for loss of good will. Although such damages may be recoverable under certain circumstances ( Landon v. Hill, 136 Cal. App. 560 [29 Pac. (2d) 281]; Risdon v. Hotel Savoy Co., 99 Wash. 616 [170 Pac. 146]), there is no evidence in the present case to support an award therefor. Dr. Beckett testified to a loss of business following his eviction but there is nothing to indicate that this decrease was caused by the eviction.

 [*639]  CA(8) (8) He also urges his right to exemplary damages. However, HN6 such damages are recoverable only "where [***9]  the defendant has been guilty of oppression, fraud, or malice, express or implied" ( sec. 3294, Civ. Code), and whether there has been such conduct is always a question for the trial judge or the jury to decide upon the evidence in the particular case. Although the acts of the department store's employees in connection with the eviction of Dr. Beckett were somewhat extreme, the finding that Dr. Beckett should not recover exemplary damages is conclusive upon this court under the evidence as a whole.

The judgment is therefore modified by adding the sum of $ 147.83 to the amount of $ 666 for which damages were awarded and as so modified the judgment is affirmed, the appellant Lawrence G. Beckett to recover costs on appeal.

[강석근]

로레토 케이스는 permanent physical occupation rule 을 정립한 케이스로 알고 있습니다. 하지만 이를 비판 하는 목소리가 본케이스 외에서도 많이 들리는 것 같습니다. 디센팅 에서는 permanent physical occupation rule 을 traditional rule 로 인정 하지 않고 있으며 per se rule 을 사건에 적용하기에 여러가지 한계가 있음을 지적 하고 있습니다. 예를 들어 본 케이스에 적용하자면 점유시설물은 아주 작은 형태 입니다. 이것을 돈으로 환산 한다면 정말 딱 $1가 될지도 모릅니다. 이러한 미미한 점유로 법률분쟁을 일으키는 것은 소위 배보다 배꼽이 더 클지도 모르는 일 입니다. 또한 건물주는 정부의 점유로 인해 건물의 미관이 파괴된다고 주장 하지만 실제로 건물의 가치는 올랐다고 보고 있으므로 건물주의 데미지를 입증하는데 어려움을 주고 있습니다.

[강석근]

또한 점유가“permanent”한지에 대하여 따지자면, 건물주가 세입자를 들이는 한 그리고 세입자가 케이블티브이를 원하는 한, 그리고 케이블티브이 회사가 사업을 유지 하는 한 시설물은 (영원히?)철거 되지 않을 것임을 다수의견과 디센팅 의견이 동시에 언급 하고 있지만, 디센팅의 관점 에서는 세입자와 사업자가 원하는 동안만 시설물이 존재하는 것이지 per se rule 에서 말하는 permanent 와는 다소 성격이 다르다는 점을 지적 하고 있습니다. 건물주는 단지 건물을 주거지임대가 아닌 다른 용도로 사용 함으로서 828을 벋어 날수 있다는 사실 또한 점유가“permanent”의 성격과 거리가 있다는 것을 잘 보여 줍니다. 이러한 관점에서 볼 때, Per se rule 보다 Penn Central의ad hoc, factual inquiries 더욱 실용적이고 합리적으로 보입니다. Penn Central 에서는 physical occupation 뿐만 아니라 여러가지 요소를 고려해서 case by case 로 좀더 합리적인 결과를 유도 한다고 생각 합니다. 즉,점유물의 크기나 유용성 및 성격을 종합적으로 고려할 필요가 있다고 생각 합니다.

[강석근]

로렌스 케이스는 계약이 라이센스인지 리스인지가 주 이슈 입니다. 건물주가 패소 했지만 그러므로 케이스의 생동감을 살리기 위해 건물주의 입장을 최대한 고려해 보겠습니다. 계약서에는 건물주가 언제든지 사원을 해고 할 수 있다는 조항이 포함 되어 있습니다. 또한 렌트는 정해진 액수가 없고 이윤의 20% 입니다. 게다가 부동산의 주소도 포함 되어 있지 않아 보입니다. 이러한 사실을 미루어 보아 건물주는 입대가 아닌 라이센스라고 굳게 믿고 있었던 것 같고 충분히 일반적인 사람들도 거물주의 입장을 이해 할 수 있다고 생각 합니다. 하지만 법원은 계약서의 문장과 형식에서 원고의 승소 원인을 찾았다고 생각 합니다.