The National Association of REALTORS® (NAR) had several major wins recently in the U.S. Supreme Court, advancing and protecting property rights around the country. Legal challenges in support of property rights are an important tool in public policy and advocacy, with decisions that have broad regulatory implications around the country.
In 2023, NAR submitted two amicus briefs in support of property owners engaged in legal disputes with their states. In Tyler v. Hennepin County, an elderly homeowner who lost her condo to foreclosure filed a suit against the county for keeping the excess proceeds from the sale of her property above the tax debt owed. NAR supported her entitlement to the surplus equity, arguing the state statute is an unconstitutional taking of property under the Fifth Amendment. The Supreme Court agreed, holding unanimously that the homeowner had a plausible case under the Takings Clause, which requires the government to pay just compensation when acquiring property from private owners for public use.
In the second case, Sackett v. Environmental Protection Agency (EPA), homeowners were prohibited from developing near a lake due to the EPA’s “significant nexus” test for the Clean Water Act’s (CWA) Waters of the U.S. (WOTUS) rule, which considered whether waters that were adjacent to or impacted nearby “navigable waters” (those explicitly covered under WOTUS) and thus under the EPA’s jurisdiction. The Supreme Court declared the test overbroad and narrowed the WOTUS criteria. NAR’s brief, done in coalition with other impacted industry groups, emphasized that while the CWA has not changed, regulatory agencies have broadened its definitions over the years. The Court agreed, and the new definition of WOTUS, while still overbroad, is an improvement. NAR has had two more recent legal victories at the Supreme Court in 2024. NAR submitted amicus briefs in support of the property owners in both cases.
In Sheetz v. El Dorado County, the plaintiff sued the state of California over a large fee imposed by the state before he could build a home on his property, arguing that it was an illegal taking. The property owner asserted that a precedent previously established by the Supreme Court for fees imposed on an individual basis applied, while the state argued that because the fees came from legislation, it did not. The Court sided with the plaintiff, holding that the test can be applied to fees authorized by legislation.
In Devillier v. Texas, Texas used portions of a highway as a flood evacuation route, installing a barrier along it to act as a dam. The private property on the other side of the barrier then flooded, causing significant damage. The plaintiff argued that by building the barrier and using his property to store stormwater, the state had taken his property and owed him just compensation. The Court held that the plaintiff was able to pursue a takings-clause case under Texas state law.
NAR’s work in the legal arena is facilitated by the Amicus Brief Advisory Board and the Legal Action Committee. NAR also partners with state and local associations, the American Property Owners Association and other organizations when necessary.
The decisions cited here establish important precedents that will be used in future legal arguments to protect private property rights in this country.
For more information, visit https://www.nar.realtor.
