What are the facts?
Del Monte Dunes at Monterey, Ltd. purchased an approximately 37-acre coastal parcel in Monterey, California, intending to develop it consistent with the City's zoning and general plan. Over several years, the developer submitted a series of revised site plans in response to City feedback, repeatedly reducing density, expanding open space, and redesigning to address concerns about traffic, access, coastal resources, and the protection of sensitive dune habitat (including habitat for an endangered butterfly). Despite the developer's successive concessions and compliance with numerous staff-recommended conditions, the City denied approval multiple times, often introducing new or evolving reasons for rejection even after earlier conditions had ostensibly been met. Eventually, after the City denied yet another substantially scaled-back proposal, the developer sued under 42 U.S.C. § 1983, alleging that the City's conduct effected a temporary regulatory taking without just compensation in violation of the Fifth and Fourteenth Amendments and also violated substantive due process. A federal jury found in favor of the developer, awarding damages for the period during which all economically viable use was allegedly denied. The district court entered judgment and awarded attorney's fees; the Ninth Circuit affirmed. The Supreme Court granted certiorari to decide whether the Seventh Amendment guaranteed a jury trial in such §1983 actions and whether the Dolan "rough proportionality" standard governed the case.
What is the legal issue?
1) In a §1983 action seeking legal damages for an alleged regulatory taking and substantive due process violations arising from repeated land-use permit denials, does the Seventh Amendment guarantee a right to trial by jury on liability and damages? 2) Does Dolan's "rough proportionality" test apply to a case involving repeated permit denials where the government did not demand a dedication or exaction of property as a condition of approval?
What rule applies?
• Seventh Amendment: The Amendment preserves the right to a jury trial in actions at law. A §1983 claim seeking legal relief (money damages) for constitutional violations is analogous to traditional actions at law, and thus the parties are entitled to a jury on issues traditionally tried to a jury, including liability and damages. • Regulatory Takings and Temporary Takings: Government regulations that deny all economically beneficial use of property, even temporarily, may give rise to compensable takings, and damages are an available remedy (see, e.g., First English Evangelical Lutheran Church). • Exactions Doctrine Limited: The heightened "essential nexus" and "rough proportionality" tests (Nollan, Dolan) apply to adjudicative exactions—government demands that a permit applicant dedicate property or an interest in property as a condition of approval—not to general permit denials or ordinary land-use decisionmaking where no property dedication is exacted. • Municipal Liability: A municipality can be liable under §1983 when a constitutional deprivation results from an official policy or decision by the municipality's final policymakers (Monell).
What did the court hold?
Yes. The Court held that the Seventh Amendment entitles the parties to a jury trial in a §1983 action seeking legal damages for alleged regulatory takings and related due process violations arising from land-use decisions. No. The Court further held that Dolan's "rough proportionality" standard does not apply to this case because the City did not demand a property dedication as a condition of permit approval; the dispute involved general permit denials, not exactions. The judgment for the developer was affirmed.
What is the reasoning?
On the Seventh Amendment question, the Court explained that the proper inquiry is twofold: whether the action resembles suits at common law and whether the relief sought is legal or equitable. A §1983 claim for damages arising from unconstitutional land-use decisions is akin to traditional tort actions at law, and the remedy—money damages for the period of deprivation—is legal. The Court emphasized that the jury's role in resolving disputed facts about the City's conduct and its effects on property use aligns with historical practice. Nor did anything in the Takings Clause transform the damages claim into a uniquely equitable proceeding; First English confirms that damages are an available form of relief for temporary takings. Turning to Dolan, the City sought to import the "rough proportionality" test to challenge the jury instructions and verdict. The Court rejected that move, clarifying that Nollan and Dolan address a specific scenario: when the government conditions permit approval on the applicant's surrender of a property interest, raising a distinctive risk of coercion. In contrast, Del Monte Dunes involved a series of outright denials and changing conditions, without a demand that the developer dedicate land or an interest in land. Because no exaction occurred, the heightened Dolan scrutiny was inapposite. The Court concluded that the district court properly sent the factual disputes to a jury under then-prevailing standards, and the City's challenges to the instructions did not warrant reversal. Finally, the Court noted that municipal liability was properly premised on the actions of final City policymakers in repeatedly denying approvals. The developer's claims were tried as claims against the City's own decisions, satisfying Monell's requirement that the deprivation stem from official policy or custom.
Why is this case significant?
City of Monterey clarifies procedure and doctrine in land-use constitutional litigation. Procedurally, it confirms a jury right in §1983 actions seeking legal damages for regulatory takings and due process violations, recognizing that such claims often turn on fact-intensive disputes suitable for juries. Substantively, it confines the powerful Nollan/Dolan framework to true exaction cases, preventing its overextension to general permit denials. The case also affirms that temporary regulatory takings can yield damages. For students, it underscores the importance of framing claims and remedies, understanding the limits of exactions doctrine, and appreciating Monell's role when suing municipalities. Note: In 2005, Lingle v. Chevron rejected the "substantially advances" test as a takings inquiry, relocating such concerns to due process; Monterey's core holdings on the jury right and the limits of Dolan remain intact.
Does City of Monterey mean all takings claims must be tried to a jury?
No. The decision recognizes a Seventh Amendment jury right in §1983 actions seeking legal damages for alleged regulatory takings and related due process violations. Many inverse condemnation actions for just compensation or equitable/declaratory relief may still be tried to the court, and state procedures may differ. The key is the nature of the action and remedy: legal damages in a §1983 suit triggers the jury right.
How does the case limit Dolan and Nollan?
The Court confined Dolan's "rough proportionality" (and Nollan's "essential nexus") to adjudicative exactions—situations where the government conditions permit approval on the dedication of property. The standards do not apply to general permit denials or to ordinary land-use conditions that do not require surrender of a property interest.
Did the Supreme Court decide that a taking occurred on the merits?
The Court did not reweigh the evidence to decide liability anew. Instead, it addressed the proper decisionmaker (jury versus judge) and the applicability of Dolan. It affirmed the judgment, leaving the jury's factual determinations and the lower courts' application of then-governing standards in place.
What role did Monell municipal liability play?
Monell requires that a municipality be responsible only for deprivations caused by its official policy or decisions of final policymakers. Here, the denials were made by the City's authorized decisionmakers, so the jury could attribute the constitutional injury to the City itself. The Supreme Court found no reversible error on that point.
How does City of Monterey interact with later cases like Lingle v. Chevron?
At the time of City of Monterey, courts often referenced the "substantially advances" test (from Agins) in takings analysis. Lingle later held that test is not a takings inquiry but may relate to due process. City of Monterey's core holdings—jury right in §1983 damages actions and limiting Dolan to exactions—remain good law.