Loretto v. Teleprompter Manhattan CATV Corp.

No. 81-244. Argued March 30, 1982. Decided June 30, 1982. Appeal from the Court of Appeals of New York. Judgment reversed and the case remanded (53 N.Y.2d 124, 423 N.E.2d 320, reversed and remanded). Opinion of the Court by Justice Marshall; Justice Blackmun filed a dissenting opinion, in which Justices Brennan and White joined.

Editorial note. Section 828 of the New York Executive Law required a landlord to permit a cable television company to install its facilities on the landlord's property and forbade demanding payment beyond the amount a state commission found reasonable; the commission had set a one-time fee of one dollar. After purchasing a five-story apartment building in New York City, the appellant discovered that the cable company had installed cable along the roof and exterior wall and had placed directional taps and boxes on the building to serve tenants and adjoining buildings. She sued, contending that the installation was a taking without just compensation.

Editorial note. The New York Court of Appeals upheld the statute as a legitimate exercise of the police power and held that no taking had occurred because the installation caused no significant interference with the landlord's use. The Supreme Court reversed and remanded, leaving the adequacy of the one-dollar fee for the state courts.

Editorial note. The issue was whether a minor but permanent physical occupation of an owner's property authorised by statute is a taking. The Court held that it is. When the character of the government action is a permanent physical occupation, there is a taking to the extent of the occupation without regard to whether the action achieves an important public benefit or has only minimal economic impact on the owner. The rule that follows is categorical: permanent physical occupation is a per se taking, and the constitutional inquiry shifts from liability to the measure of just compensation.

Editorial note. Justice Marshall reasoned from the historical distinction between physical invasion and mere regulation of use. A permanent occupation destroys each of the owner's rights in the space occupied: the rights to possess, use, and dispose of it, and above all the right to exclude. That is qualitatively different from a regulation that merely restricts use, which is assessed under the multifactor analysis of Penn Central. The Court accordingly declined to weigh the public purpose of promoting cable service or the trivial economic loss, and distinguished ordinary landlord-tenant regulation, such as compulsory compliance with building codes, on the ground that such requirements do not authorise a stranger to occupy the premises.

Editorial note. Loretto establishes the first of the categorical takings rules and gives the right to exclude its central place in the constitutional law of property. For the treatise it marks the boundary between physical takings and regulatory takings, and it explains why later cases turn so heavily on whether the challenged measure appropriates an interest in land or merely restricts the owner's use of it.

Editorial note. Followed and applied. Lucas v. South Carolina Coastal Council, 505 U.S. 1003 (1992), treated Loretto as one of two categorical rules; Horne v. Department of Agriculture, 576 U.S. 350 (2015), extended the physical-appropriation analysis to personal property; and Cedar Point Nursery v. Hassid, 594 U.S. 139 (2021), applied it to a regulation granting third parties a right of access, holding that the appropriation need not be continuous in time to be a per se taking.

Editorial note. Read with U.S. Const. amend. V (Takings Clause) and the treatise chapters on regulatory takings and landlord and tenant.