Pennsylvania Coal v Mahon 260 U.S. 393 (1922)

1. Pennsylvania Coal v Mahon260 U.S. 393(1922) Welcome to the wonderful world of regulatory takings.

2. What’s it all about? • Could a restriction on the use of property to protect others constitute a taking of private property? • Prevailing thought was no. • Restrictions that protected the property of others were legitimate exercises of the police power if a treat to others actually existed. • Issues with respect to reasonableness always were relevant.

3. Subsidence Pit Subsidence – a diagrammatic depiction of a mine- roof collapse and the effect on the surface.

4. Subsidence – a man-made sink hole

7. The Kohler Act of 1921 • Pennsylvania law that: • Forbid coal mining that would result in subsidence under “structures used by the public.” • In effect, act required a “pillar” of coal to be left under “structures,” streets, etc.

8. Why enacted? • Before say 1900, coal was mined by the “room and pillar” method.

9. Room & Pillar Method Coal Bedrock

10. Why enacted? • Before say 1900, coal was mined by the “room and pillar” method. • Enough pillars were left to support the surface. • This was not to be a good neighbor • This was to get the miners and equipment out • But . . .

11. The technology and economics of coal mining changed – • More of the coal could be removed [technologically] and • The price of coal put pressure on maximization of yield, so some • Companies were “remining” previously mined shafts, removing some of the pillars. • So . . .

12. Now the support only had to last long enough to get the miners and machinery out. • Subsidence followed. • The Kohler Act followed subsidence.

13. The new and improved Room & Pillar method Coal Bedrock

14. Background • 1878 Mr. & Mrs. H. J. Mahon bought the property – during the earlier “room & pillar” method. • The property was sold with the express reservation of the right to remove coal under the property. • The grantee took the premises with that risk and waived all claims for damages that may arise from the mining out the coal. • Mr. Mahon was an attorney.

15. State Court • After receiving notice of their intent to mine under his property, Mahon filed suit pursuant to the Kohler Act to enjoin Penn Coal from removing supports [the pillars] under his property, thereby causing subsidence of the surface. • Injunction was denied but then reversed by the Pennsylvania Supreme Court. • State court action was appealed to the US Supreme Court.

16. A new concept of takings • Justice Oliver Wendell Holmes wrote the opinion.

17. Holmes’ observations “Government hardly could go on if to some extent values incident to property could not be diminished without paying for every such change in the general law. • As long recognized, some values are enjoyed under an implied limitation and must yield to the police power. • But obviously the implied limitation must have its limit . . . • . . . One fact for consideration in determining such limits is the extent of the diminution.”

18. “When it [diminution] reaches a certain magnitude, in most if not in all cases, there must be an exercise of eminent domain and compensation to sustain the act.” • “So the question depends upon the particular facts. • The greatest weight is given to the judgment of the legislature, but it always is open to interested parties to contend that the legislature has gone beyond its constitutional power.”

19. The Holmes Rule • “The general rule at least is that while property may be regulated to a certain extent, if regulation goes too far it will be recognized as a taking.” • How far is too far?

20. “What makes the right to mine coal valuable is that it can be exercised with profit. • To make it commercially impracticable to mine certain coal has very nearly the same effect for constitutional purposes as appropriating or destroying it.” . . . • “We are in danger of forgetting that a strong public desire to improve the public condition is not enough to warrant achieving the desire by a shorter cut than the constitutional way of paying for the change.”

21. Brandeis’ Dissent • A restriction imposed to protect the public from danger is not a taking. • The restriction imposed is merely the prohibition of a noxious use. • If mining were to set free a noxious gas, state could prohibit it without payment. • Why not also a mining practice that constitutes a danger?

22. The denominator • Holmes addresses the “extent of the diminution”. He sees it as an indicator of the requirement to pay compensation. • But, the diminution of what? • The total ownership, or • The regulated property?

23. Under the Kohler Act • Could mine without restriction • In areas with no habitable structures, or • In areas with no public improvements, or • In areas when the same entity owned both surface and subsurface rights. • Could mine under restricted areas if supporting pillars remained.

24. Coal Mining under the Kohler Act

25. Extent of diminution • In above, 10% of coal affected by requirement, so . . . • Diminution to total ownership – 10% • Diminution to regulated land – 100% • Holmes did not elaborate on this matter, but he clearly is focusing on the extent of the diminution in value of the regulated land.