HUFFMAN: Property rights and wrongs

By | Thursday, June 26, 2008

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In 1978, Wayne and Jean Hage purchased a 7,000-acre ranch in Nevada. With the ranch they acquired grazing permits on large tracts of public land and rights to water diverted from some of those lands. In accordance with their grazing permits and pursuant to their state-recognized water rights, the Hages constructed a variety of improvements, including several miles of pipeline, 298 miles of fence and 634 miles of roads and trails.

For its part, the government authorized the Nevada Department of Wildlife to release elk onto the Hage grazing lands, fenced waters owned by Hage to exclude cattle (but not Elk who can jump fences), made 70 visits to the Hage ranch and sent 40 letters alleging a wide array of mostly minor infractions of regulations, refused to renew some of Mr. Hage's grazing permits, prevented Mr. Hage from accessing public lands to maintain his water supply, prosecuted him (unsuccessfully) for trespass and twice impounded his cattle.

Mr. Hage filed a lawsuit in 1991 claiming his property rights had been taken without just compensation in contravention of the Fifth Amendment takings clause. Seventeen long years later, on June 6, the U.S. Court of Federal Claims decided the United States owes the estate of Wayne and Jean Hage $4.2 million. With interest and attorney's fees the total government bill will be several times that amount, but still it is not a lot of money for a government eager to spend more than $300 million on a bridge to nowhere.

But paying what would have been a much lower price to purchase Mr. Hage's rights in 1991 did not occur to the federal government. Instead it engaged in a 17-year legal battle that outlived the Hages. The government's purpose in this marathon was to prove that the Hages did not have the property rights they claimed. Lest Mr. Hage, who could not afford the cost to redeem his cattle, take advantage of the government, the National Wildlife Federation, the Natural Resources Defense Council, the Nevada Wildlife Federation and the Sierra Club all weighed in as amici curiae in support of the government's position.

There is no mystery why the nation's leading environmental groups weighed in against the Hages. They find property rights and productive use of the land anathema to their antidevelopment, preservationist agenda. But shouldn't we expect better of our government?

"It is a fundamental duty of government to protect, rather than to destroy, personal property," wrote Court of Claims Judge Loren Smith. For good measure, Judge Smith quoted John Locke who wrote that "[w]henever the legislators endeavor to take away, and Destroy the Property of the People ... they put themselves into a state of War with the People, who are there upon absolved from any further obedience."

And war it must have seemed to this family of Nevada cattle ranchers. But there was no absolution for the Hages who, like so many other elderly Americans, died while waiting and hoping that a court would enforce their constitutionally protected property rights. Of course, the battle over Hage's property rights may not be over. There is every reason to assume the government will appeal the trial court judgment.

The Hage case is just one of many evidencing that modern American governments at every level have no sense of the duty of which Judge Smith wrote. Property rights and the constitutional mandate that compensation be paid when property is taken are viewed by governments as unfortunate obstacles to the pursuit of the public interest. There is little appreciation for the essential role of property rights to a thriving economy or to the fundamental liberties of American citizens.

Property rights advocates will celebrate this little victory, though sadly, the Hages are missing the party. Environmentalists, on the other hand, will assail the judge as a lackey of the propertied classes and the Hages as destroyers of the environment.

The rest of us, if we care about fairness and the rule of law, should appreciate Judge Smith's decision for what it is - a careful, thoughtful, respectful application of the law, including the much maligned and often ignored takings clause of the Fifth Amendment.

James L. Huffman is Erskine Wood Sr. Professor of Law at the Lewis & Clark Law School in Portland, Ore., and a member of the Property Rights, Freedom and Prosperity Task Force at Stanford University's Hoover Institution.

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