United States Court of Appeals
For the First Circuit
Nos. 02-2179
02-2233
PASCOAG RESERVOIR & DAM, LLC,
Plaintiff-Appellant/Cross-Appellee,
v.
THE STATE OF RHODE ISLAND, acting by and through
JAN REITSMA, in his capacity as Director of the
RHODE ISLAND DEPARTMENT OF ENVIRONMENTAL MANAGEMENT,
and SHELDON WHITEHOUSE, in his capacity as Attorney General
for the State of Rhode Island,
Defendants-Appellees/Cross-Appellants.
APPEALS FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF RHODE ISLAND
[Hon. Ronald R. Lagueux, U.S. District Judge]
Before
Boudin, Chief Judge,
Torruella and Lipez, Circuit Judges.
Barry J. Kusinitz, for plaintiff-appellant/cross-appellee.
Michael Rubin, Assistant Attorney General, with whom Sheldon
Whitehouse, Attorney General, James R. Lee, Assistant Attorney
General Div. Chief for the State of Rhode Island, Claire Richards,
Deputy Executive Counsel, and Mary Kay, Deputy Chief Legal Counsel,
for the Rhode Island Department of Environmental Management, were
on brief, for defendants-appellees/cross-appellants.
July 28, 2003
TORRUELLA, Circuit Judge. Rhode Island, through its
Department of Environmental Management, acquired an area of land in
the Pascoag Reservoir ("Reservoir" or "Lake") by adverse possession
and obtained a prescriptive easement on behalf of the public to use
the Reservoir for recreational activities. In this inverse
condemnation suit,1 Pascoag Reservoir & Dam, LLC ("Pascoag"), the
Reservoir's owner, seeks compensation for that acquisition.
The district court dismissed the case for failure to
state a claim. Pascoag Reservoir & Dam, LLC v. Rhode Island, 217
F. Supp. 2d 206, 229 (D.R.I. 2002) (hereinafter "Pascoag Federal
Decision"). The court found that, as a general rule, the
government must compensate for a taking made by adverse possession
or prescription, but Pascoag may not recover in this case either
because the statute of limitations began to run in 1975, when the
state acquired its property rights, or because the doctrine of
laches bars recovery. Id. at 226-29. The court then dismissed
Pascoag's state law claims. Id. at 229.
The state appeals the first finding, asserting that
adverse possession and prescription do not constitute a taking of
property under the Constitution. Pascoag appeals the dismissal of
1
Inverse condemnation is "'a cause of action against a
governmental defendant to recover the value of property which has
been taken in fact by the governmental defendant, even though no
formal exercise of the power of eminent domain has been attempted
by the taking agency.'" United States v. Clarke, 445 U.S. 253, 257
(1980) (quoting D. Hagman, Urban Planning and Land Development
Control Law 328 (1971)).
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its claim, arguing that the statute of limitations did not begin to
run until the recent judicial determination that the state had
acquired property rights in the Reservoir.
We agree with the district court that Pascoag failed to
state a viable claim. Because Pascoag failed to timely pursue its
state remedies, it forfeited its federal claim. Following the
"fundamental rule of judicial restraint," we do not reach the
constitutional question of whether compensation is due when the
state acquires land by adverse possession or prescription. Am.
Mfrs. Mut. Ins. Co. v. Sullivan, 526 U.S. 40, 62 (Ginsburg, J.,
concurring in part and concurring in the judgment) (quotation
omitted); see also Kelly v. Marcantonio, 187 F.3d 192, 197 (1st
Cir. 1999) (declaring "courts should not reach constitutional
questions in advance of the necessity of deciding them").
I. Facts
Located in the towns of Burrillville and Glocester, Rhode
Island, the Reservoir (also known as Echo Lake) is more than two
miles long and has more than ten miles of shoreline. Pascoag's
predecessor in title created the Lake in 1860; Pascoag has owned
the Reservoir since 1983. In 1964, the state purchased a lot
abutting the Reservoir and constructed a public boat ramp the
following year.
Until at least 1997, "members of the public could . . .
use the ramp as a point of access to the lake for various
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recreational activities, including boating and fishing." Reitsma
v. Pascoag Reservoir & Dam, LLC, 774 A.2d 826, 829 (R.I. 2001)
(hereinafter "Pascoag State Decision"). The Reservoir was enjoyed
by "innumerable members of the public and other lakeside property
owners." Id. In 1997, Pascoag sought to limit the public's use by
placing a "NO TRESPASSING" sign near the water. Id.
In 1998, the state brought suit in state court asserting,
among other things, that it had acquired property rights in the
Reservoir. Pascoag cross-claimed, alleging that the state's
actions constituted a taking without just compensation, but the
state courts did not decide the taking issue because Pascoag later
voluntarily dismissed its inverse condemnation claim. In 2001, the
Rhode Island Supreme Court held that the state had acquired by
adverse possession a small portion of the Lake bottom (occupied by
the boat ramp) and had acquired, on the public's behalf, a
prescriptive easement to use the boat ramp to access the entire
Lake for recreational purposes. Id. at 834. The court held "that
the state had begun to use the Reservoir property in 1965 and,
under the Rhode Island ten year adverse possession statute, had
acquired title to a portion of the Reservoir plus an easement in
1975." Pascoag Federal Decision, 217 F. Supp. 2d at 211 (citing
Pascoag State Decision, 774 A.2d at 838). The issue in the state
case was whether the state acquired land rights by adverse
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possession and prescription; the Rhode Island Supreme Court held
that it did. Pascoag State Decision, 774 A.2d at 834.
Pascoag filed this complaint in federal court in October
2001, alleging that the state violated the Takings Clause of the
Fifth and Fourteenth Amendments and asserting related state law
claims. The district court, treating the claim as one arising
under 42 U.S.C. § 1983, dismissed the suit, and this appeal
followed.
II. Standard of Review
We review de novo the district court's dismissal for
failure to state a claim under Fed. R. Civ. P. 12(b)(6). Rockwell
v. Cape Cod Hosp., 26 F.3d 254, 255 (1st Cir. 1994). We accept the
complaint's allegations as true and make all reasonable inferences
in favor of the plaintiff. Id. We will affirm the dismissal only
if Pascoag cannot prove any facts entitling it to relief. Id.
III. Discussion
A. Prerequisites to a Takings Claim
In Williamson County Regional Planning Commission v.
Hamilton Bank, the Supreme Court outlined two prerequisites to a
federal suit alleging a Fifth Amendment taking of a property
interest. 473 U.S. 172, 186, 194-95 (1985). A federal suit is not
timely until a plaintiff demonstrates that (a) "the government
entity charged with implementing the regulations has reached a
final decision regarding the application of the regulations to the
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property at issue," (the "final decision requirement") and (b) the
plaintiff sought (and was denied) just compensation by means of an
adequate state procedure (the "state action requirement").2 Id. at
186, 194-95. Williamson County stands "for the proposition that
there is no uncompensated taking -- that is, nothing to litigate
under § 1983 -- until the state has established (a) what it has
taken, and (b) its refusal to pay 'just compensation.'" SGB Fin.
Servs., Inc. v. Consol. City of Indianapolis-Marion County, Ind.,
235 F.3d 1036, 1038 (7th Cir. 2000).
Although Williamson County was a regulatory taking case,
a modified verison of its timeliness analysis applies to physical
taking cases. Daniel v. County of Santa Barbara, 288 F.3d 375, 382
(9th Cir. 2002). The present case concerns a potential physical
taking, based on the intrusion onto Pascoag's property or the
acquisition of rights in that property.3 In a physical taking
case, the final decision requirement is relieved or assumed because
"[w]here there has been a physical invasion, the taking occurs at
once, and nothing the [governmental actor] can do or say after that
point will change that fact." Hall v. City of Santa Barbara, 833
2
This case does not raise the issue of whether the Williamson
County requirements apply when a litigant alleges that the state
has taken property for a purely private use. See Daniels v. Area
Plan Comm'n, 306 F.3d 445, 453 & n.6 (7th Cir. 2002) (identifying
circuit split and citing cases).
3
Both the fee simple in the Lake bottom and the easement on
behalf of the public are permanent physical occupations. See
Nollan v. Cal. Coastal Comm'n, 483 U.S. 825, 832 (1987).
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F.2d 1270, 1281 n.28 (9th Cir. 1987); cf. Arnett v. Myers, 281 F.3d
552, 563 (6th Cir. 2002) (finding final decision requirement
satisfied because decision maker "arrived at a definitive position
inflicting an actual, concrete injury when its agents removed and
destroyed" plaintiff's alleged property); Forseth v. Village of
Sussex, 199 F.3d 363, 372 n.12 (7th Cir. 2000) (finding physical
taking claim subject only to Williamson County's state action
requirement). However, the state action requirement remains in
physical taking cases: "[C]ompensation must first be sought from
the state if adequate procedures are available." Sinaloa Lake
Owners Ass'n v. City of Simi Valley, 882 F.2d 1398, 1402 (9th Cir.
1989), overruled on other grounds by Armendariz v. Penman, 75 F.3d
1311, 1326 (9th Cir. 1996) (en banc).
B. State Action Requirement
Here, if Rhode Island "provides an adequate process for
obtaining compensation, and resort to that process holds out some
realistic promise of yielding just compensation," Pascoag may not
seek compensation in federal court for an alleged taking without
first resorting to the state process. Gilbert v. City of
Cambridge, 932 F.2d 51, 63 (1st Cir. 1991); accord Williamson
County, 473 U.S. at 195 ("[I]f a state provides an adequate
procedure for seeking just compensation, the property owner cannot
claim a violation of the Just Compensation Clause until it has used
the procedure and been denied just compensation."). "'[B]ecause
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the Fifth Amendment4 proscribes takings without just compensation,
no constitutional violation occurs until just compensation has been
denied.'" Gilbert, 932 F.2d at 63 (quoting Williamson County, 473
U.S. at 194 n.13); accord Gamble v. Eau Claire County, 5 F.3d 285,
286 (7th Cir. 1993) (stating that a litigant must "exhaust[] his
remedies for obtaining a compensation award or equivalent relief
from the state" because "the right protected by the duty of just
compensation is not to the land or its use but merely to the market
value of what is taken"). Thus, "the state's action . . . is not
'complete' until the state fails to provide adequate compensation
for the taking." Williamson County, 473 U.S. at 195.
Pascoag did not seek compensation through the state
court. Pascoag's burden is to show that one of the narrow
exceptions to the state action requirement applies. The Supreme
Court in Williamson County identified two exceptions -- where state
remedies were "unavailable" or "inadequate." 473 U.S. at 196-97;
accord Deniz v. Municipality of Guaynabo, 285 F.3d 142, 146 (1st
Cir. 2002); Gilbert, 932 F.2d at 65. Some courts have also
recognized an exception where state remedies are "futile." See,
e.g., Daniels, 306 F.3d at 456.
4
The Fifth Amendment provides that "private property [shall not]
be taken for public use without just compensation." U.S. Const.
amend. V. It applies to the states through the Fourteenth
Amendment. MacDonald, Sommer & Frates v. County of Yolo, 477 U.S.
340, 342 n.1 (1986).
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1. Availability of adequate state remedies
First, we consider whether adequate state remedies were
available to Pascoag. Courts have made exceptions to Williamson
County's state action requirement when state law did not recognize
the taking that occurred, or did not permit the relief required to
make the plaintiff whole. See, e.g., Daniels, 306 F.3d at 456-57
(finding an exception to the state action requirement because
plaintiffs did not have a "definable pecuniary loss" and state
inverse condemnation proceedings were limited to monetary damages);
Hall, 833 F.2d at 1281 n.28 (finding a state court process
inadequate because at the time, no action for inverse condemnation
based on a regulatory taking could be brought under California
law); see also Suitum v. Tahoe Reg'l Planning Agency, 520 U.S. 725,
734 n.8 (1997) ("Ordinarily, a plaintiff must seek compensation
through state inverse condemnation proceedings before initiating a
takings suit in federal court, unless the state does not provide
adequate remedies for obtaining compensation.").
Pascoag cannot show that Rhode Island's remedies were
inadequate or unavailable. The Rhode Island Constitution prohibits
the taking of private property for public use without just
compensation and Rhode Island state courts have long allowed
recovery through suits for inverse condemnation. Annicelli v.
Town of South Kingstown, 463 A.2d 133, 139 (R.I. 1983); E & J Inc.
v. Redevelopment Agency of Woonsocket, 405 A.2d 1187, 1189 (R.I.
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1979) ("Governmental action short of actual acquisition of property
may be a constructive taking or an inverse condemnation . . . .");
cf. Caldarone v. Rhode Island, 199 A.2d 303, 304 (R.I. 1964)
(assessing damages for land taken by state); see also Harris v. Mo.
Conservation Comm'n, 790 F.2d 678, 680-81 (8th Cir. 1986) (finding
constitutional provision provided adequate remedy). Thus, Rhode
Island has an adequate process available to address Pascoag's suit
for just compensation.
2. Futility of pursuing state remedies5
In its decision regarding the property rights of the
state and Pascoag, the Rhode Island Supreme Court discussed
Pascoag's potential takings claims in dicta:
[E]ven if the state's conduct from 1965 to
1975 had been unlawful and amounted to an
improper taking of the lake owner's property
without paying just compensation, and even if
the lake owner's property had not been taken
in the constitutional sense until the
prescriptive period ended in 1975 - issues
that we have no need to decide in this case -
the corporation and its predecessors failed to
assert any takings claim in a timely manner.
Thus, they are barred from asserting them now
under any statute of limitations that possibly
could apply to such claims . . . .
5
We recognized a futility exception to Williamson County's final
decision requirement where "the granting authority has dug in its
heels and made it transparently clear that the permit, application
or no, will not be forthcoming." Gilbert, 932 F.2d at 61 (citation
omitted). A futility exception to the state action requirement
would exist under similar circumstances.
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Pascoag State Decision, 774 A.2d at 838. Pascoag argues that
because this language suggests that Pascoag's claim is time-barred,
state court remedies are futile.
Again, Pascoag fails to carry its burden to show that an
exception to the state action requirement applies. Pascoag's
futility argument is simply that it is now time-barred from making
state law claims. If the futility rule were read this broadly it
would swallow the general rule of state remedy exhaustion. Like
the other exceptions, the futility exception must consider the
landowner's available state remedies at the time of the taking.
See Williamson County, 473 U.S. at 194 ("[A]ll that is required [by
the Fifth Amendment] is that a reasonable, certain and adequate
provision for obtaining compensation exist at the time of the
taking.") (quotation omitted). There is no evidence that the state
would not have been receptive to Pascoag's claim had it been
brought at the time the property was taken (regardless of whether
that was in 1965 or 1975 -- a determination we address below).
Pascoag offers no compelling explanation for not using state
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procedures earlier,6 and we find that state court remedies are not
futile.
C. Consequences of Failure to Bring a Timely State Claim
Pascoag did not satisfy the Williamson County
prerequisites for a federal claim. We have stated that takings
claims are "unripe until the potential state remedy has been more
fully pursued."7 Gilbert, 932 F.2d at 65. The situation here is
different. As the Rhode Island Supreme Court noted, there is a
fatal flaw in Pascoag's claim: it is too late for any state law
cause of action. Williamson County requires the pursuit of state
6
Because Pascoag's federal claim has been forfeited, we need not
address the issue of whether Pascoag, who became the owner of the
Reservoir in 1983, has a right to compensation. See Palazzolo v.
Rhode Island, 533 U.S. 606, 628 (2001) (noting that in a physical
taking case, "it is a general rule of the law of eminent domain
that any award goes to the owner at the time of the taking, and
that the right to compensation is not passed to a subsequent
purchaser.").
7
The term "ripe" is confusing because, as explained infra, a
plaintiff is barred from bringing federal suit in a situation such
as Pascoag's, where the state statute of limitations has run.
Ripeness terminology suggests that a claim will later be available
to the plaintiff; such language has been avoided in some recent
cases. See City of Monterey v. Del Monte Dunes at Monterey, Ltd.,
526 U.S. 687, 721 (1999) ("A federal court, moreover, cannot
entertain a takings claim under § 1983 unless or until the
complaining landowner has been denied an adequate postdeprivation
remedy."); Harbours Pointe of Nashotah, LLC v. Village of Nashotah,
278 F.3d 701, 704 (7th Cir. 2002) (noting that a plaintiff "cannot
state a claim under federal law until he has used those [state]
procedures and been denied compensation."); but see Palazzolo, 533
U.S. at 618 (using "ripeness" to explain Williamson County's
requirements in the regulatory taking context). We, too, avoid
terms of ripeness because the Williamson County requirements may
reveal the claim to be either unripe (too early) or overripe (too
late).
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remedies before a taking case is heard in federal court. Adequate
state remedies were available to Pascoag; it simply ignored those
remedies until it was too late. By failing to bring a timely state
cause of action, Pascoag forfeited its federal claim.
We assume for purposes of this appeal that a taking claim
may arise when the government acquires property rights by adverse
possession or prescription. Reviewing the dates as determined by
the Rhode Island Supreme Court, the state and the public began
using the land and water in a manner that was open, actual,
notorious, hostile, adverse, continuous, and under a claim of right
in 1965. Pascoag State Decision, 774 A.2d at 834. Property rights
were acquired by the state and the public in 1975. Id. at 838.
The state court decision was issued in 2001.
Relying on United States v. Dickinson, 331 U.S. 745
(1947), Pascoag argues that the circumstances surrounding the
taking had not "stabilized" until the Rhode Island Supreme Court's
final decision, and the statute of limitations did not begin to run
until that time. See id. at 749. We find Dickinson
distinguishable. There, the government caused plaintiff's land to
be flooded, and the water level rose over a period of years. Id.
at 747. The government did not use condemnation proceedings, but
"left the taking to physical events." Id. at 748. The Court held
that the statute of limitations did not begin to run when flooding
commenced, but only when physical events stabilized, Id. at 749.
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This ensured that damages could be ascertained and that res
judicata would not bar recovery for future damage. Id.
While Pascoag points to facts suggesting that the
situation regarding ownership of the Reservoir was not certain as
late as 1997, the State Supreme Court found that the State's use
satisfied all the adverse possession requirements by 1975. At that
time a final account could be struck, and nothing in the State's
use of the Lake changed over time, so piecemeal litigation would
not result. There was continuous occupancy by the State for ten
years at which point property rights were acquired by operation of
law and, if compensable, must be countered by a state court suit
within the period allowed by the state statute of limitations.
Pascoag also asserts that its claim was not ripe until
the decision of the Rhode Island Supreme Court. We disagree.
First, Pascoag's argument is at odds with the state court's finding
of adverse possession and prescription, which is binding on Pascoag
and requires open and notorious possession by the adverse party.
That determination means, assuming arguendo that a taking claim
could be made for acquisition by adverse possession or
prescription, Pascoag should have known that a taking was in
progress and brought suit under state law at that time (within the
relevant statute of limitations).8 The statute of limitations for
8
What remedies did Pascoag have available to it? From 1965 to
1975, before adverse possession and prescription transferred title,
Pascoag could have brought a suit to evict the state from the land
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a state taking claim is, at most, 10 years (for "all civil actions
not otherwise limited"), and likely 1 year (for "assessment of
damages in state condemnation proceedings"). R.I. Gen. Laws § 9-1-
36 (2002). Pascoag's claim was ripe under state law at least by
1975, when Pascoag, assuming it had any claim at all, could have
brought suit for recovery in state proceedings. If it had done so
and the state had denied a remedy in violation of the Constitution,
then a § 1983 claim would have ripened at the time of the denial.
To its detriment, Pascoag did not file suit, but instead waited
until the state sought judicial remedies in 1998.
Second, while the Williamson County requirements
typically reveal a claim to be premature, they may also reveal that
a claim is barred from the federal forum. See Vandor, Inc. v.
Militello, 301 F.3d 37, 39 (2d Cir. 2002); Harbours Pointe, 278
F.3d at 706; Gamble, 5 F.3d at 286; Harris, 790 F.2d at 681. The
Williamson County "ripeness" requirements will never be met in this
case, because the state statute of limitations has run on Pascoag's
inverse condemnation claim. By failing to bring its state claim
within the statute of limitations period, Pascoag forfeited its
federal claim. Gamble, 5 F.3d at 286; accord Vandor, 301 F.3d at
39. "The state provided a remedy, but plaintiff[] failed to pursue
or, alternatively, should have demanded that the state agree in
writing that occupancy was not intended to be adverse but was by
temporary and revocable permission. This may seem harsh but
adverse possession law puts this burden on all landowners as to all
occupants.
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it. [It] cannot obtain jurisdiction in the federal courts simply
by waiting until the statute of limitation bars the state
remedies." Harris, 790 F.2d at 681.
In Gamble, the plaintiff filed suit in federal court
alleging that she had been denied just compensation by a zoning
plan. Gamble, 5 F.3d at 285. The Seventh Circuit, citing
Williamson County, asked whether she had exhausted her remedies
"for obtaining a compensation award or equivalent relief from the
state." Id. at 286. Among the options available to the plaintiff
under state law was the ability to bring an inverse condemnation
suit. Id. However, the statute of limitations barred plaintiff
from raising that issue in the state courts. Id. Analogizing to
other situations where exhaustion of remedies is required, the
court held that the failure to pursue state compensation remedies
in a timely fashion forfeited plaintiff's federal claim to just
compensation. Id.
Similarly, Pascoag's failure to bring a timely suit for
compensation under state law has led to the forfeiture of its
federal taking claim. Even making all reasonable inferences in
favor of Pascoag -- that a taking claim can stand when the state
acquires land by adverse possession, that the claim did not accrue
until the state assumed property rights in 1975, and that the Rhode
Island statute of limitations for such a claim is 10 years --
Pascoag's state claim was time-barred in 1985. "[A] claimant
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cannot be permitted to let the time for seeking a state remedy pass
without doing anything to obtain it and then proceed in federal
court on the basis that no state remedies are open." Id.
Pascoag's failure to assert a timely state claim has foreclosed its
federal cause of action. "Litigants who neglect or disdain their
state remedies are out of court, period." River Park, Inc. v. City
of Highland Park, 23 F.3d 164, 165 (7th Cir. 1994).
IV. Conclusion
To sum up, a taking by adverse possession occurred, on
Pascoag's own theory, in 1975 after a ten-year period of government
occupancy or use. At that point, Pascoag had an obligation to
bring a suit in state court for compensation within the limitations
period unless the state remedy was plainly futile (which in this
case it was not); and by failing to do so it forfeited any federal
claim that state processes were inadequate. Of course, the
situation in 1975 may well have been unclear from a legal
standpoint, but for that, Pascoag's remedy was to bring a lawsuit
within the statutory period. The question of whether or not the
state must pay when it takes land by adverse possession or
prescription will have to wait for another day. Because Pascoag
failed to bring a timely claim in state court, it forfeited its
federal takings claim. The district court's decision is affirmed.
Affirmed.
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