89 N.Y.2d 535 (1997)

A subsequent purchaser of property is generally prevented from asserting a regulatory takings claim based on regulations that were in effect at the time of purchase, especially when the property is also subject to restrictive covenants.

Summary

This case concerns whether a property owner, Anello, who purchased land already subject to wetlands regulations and restrictive covenants, could claim a regulatory taking. The New York Court of Appeals held that Anello could not claim a taking. The court reasoned that the regulations were in place when she bought the property, and the prior owner had already encumbered the property with covenants that limited its use and value. Therefore, Anello did not have the unrestricted development rights in her “bundle” of property rights when she acquired the land, precluding her takings claim.

Facts

A prior owner of the property filed covenants that substantially restricted the use and value of the property, in exchange for the right to subdivide and develop what was then a larger parcel. Later, Anello purchased the property. At the time of purchase, the property was subject to both the existing wetlands regulations and the previously filed restrictive covenants.

Procedural History

The Supreme Court determined that the Town did not need to compensate Anello as if she retained the unrestricted right to develop the parcel. The New York Court of Appeals affirmed this decision.

Issue(s)

Whether a claimant is prevented from claiming a regulatory taking of her property based on regulations already in place at the time she took title, when the property is also subject to restrictive covenants filed by a former owner substantially restricting its value and use.

Holding

No, because the claimant took title subject to covenants filed by the former owner of the property, which substantially restrict the value and use of the property, and because the wetlands regulations were already in effect when the claimant purchased the property.

Court’s Reasoning

The court reasoned that the wetlands regulations did not deprive the claimant of any interest in the property that had not already been encumbered by the former owner through the covenants. By purchasing the property with pre-existing restrictions, the claimant never possessed the unrestricted right to develop the parcel. The court essentially adopted the principle that a purchaser cannot claim a taking based on regulations already in place when they bought the property, because the purchase price presumably reflected the restrictions. Wesley, J., concurring, stated that, even if the property should be valued for single-family residences, that valuation is “a consequence of the covenants entered into by the former owner in exchange for the right to subdivide and develop what was then a larger parcel.” The court, in effect, decided that the restrictions already ran with the land, meaning the current owner took title to land that already had those restrictions in place.