Murr v. Wisconsin
Headline: Court affirms that local merger rules can treat adjacent small lots as one property, upholding limits on separate sale or development and making separate sales harder for owners of substandard riverfront lots.
Holding: The Court ruled that the two adjacent riverfront lots should be treated as a single parcel under a multifactor test and that Wisconsin’s merger regulation did not amount to a taking because owners retained substantial residential use and value.
- Allows merger rules to treat adjacent substandard lots as one parcel in takings claims.
- Holds that owners retained residential use and were not deprived of all economic value.
- Supports local limits on separate sale or development to protect scenic river areas.
Summary
Background
Two sisters and two brothers in the Murr family own two adjacent riverside lots in Wisconsin. Each lot is about 1.25 acres but has less than one acre of buildable land because of steep bluffs and the waterline; combined buildable area is 0.98 acres. Wisconsin rules require at least one acre of buildable land to use a lot separately, include a grandfather clause for lots separately owned in 1976, and a merger rule that prevents adjacent lots under common ownership from being sold or developed separately. The Murrs acquired the lots in 1994 and 1995, sought variances to move a cabin and sell a lot, were denied, and sued claiming a regulatory taking. Lower courts found the lots merged and that the regulation did not deprive them of all economic value.
Reasoning
The Court addressed how to define the relevant "parcel" in a taking claim and adopted a multifactor approach weighing state and local treatment of the land, physical characteristics, and the land’s prospective value and reasonable expectations. Applying those factors, the Court agreed the lots should be treated together because state and local law merged them, they are contiguous with complementary features, and their combined valuation far exceeded the separate undevelopable estimate. The majority concluded the regulation left substantial residential use and did not destroy all economic value, so no taking was found under Lucas or the Penn Central framework.
Real world impact
The decision supports use of merger and minimum-lot rules in river and scenic areas and makes it harder for owners of adjacent substandard lots to claim a per se taking by isolating one lot. It signals that courts will apply a fact-based, multifactor inquiry rather than a strict lot-line rule when similar land-use regulations are challenged.
Dissents or concurrances
The Chief Justice, joined by Justices Thomas and Alito, dissented, arguing state law should define the parcel and that the majority’s ad hoc test undermines established property protections; Justice Thomas urged reconsideration of takings doctrine.
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