Annotation 6 - Fourteenth Amendment
Oil and Gas .--To prevent waste, production of oil and gas may be prorated; the prohibition of wasteful conduct, whether primarily in behalf of the owners of oil and gas in a common reservoir or because of the public interests involved, is consistent with the Constitution. 79 Thus, the Court upheld against due process challenge a statute which defined waste as including, in addition to its ordinary meaning, economic waste, surface waste, and production in excess of transportation or marketing facilities or reasonable market demands, and which limited each producer's share to a prorated portion of the total production that can be taken from the common source without waste. 80 Whether a system of proration based on hourly potential is as fair as one based upon estimated recoverable reserves or some other combination of factors is a question for administrative and not judicial judgment. In a domain of knowledge still shifting and growing, it has been held to be presumptuous for courts, on the basis of conflicting expert testimony, to invalidate an oil proration order, promulgated by an administrative commission in execution of a regulatory scheme intended to conserve a State's oil resources. 81 On the other hand, where the evidence showed that an order, purporting to limit daily total production of a gas field and to prorate the allowed production among several wells, had for its real purpose, not the prevention of waste nor the undue drainage from the reserves of other well owners, but rather the compelling of pipeline owners to furnish a market to those who had no pipeline connections, the order was held void as a taking of private property for private benefit. 82 Also sustained as conservation measures were orders of the Oklahoma Corporation Commission, premised on a finding that existing low field prices for natural gas were resulting in economic and physical waste, fixing a minimum price for gas and requiring one producer to take gas ratably from another producer in the same field at the dictated price. 83
Even though carbon black is more valuable than the gas from which it is extracted, and notwithstanding a resulting loss of investment in a plant for the manufacture of carbon black, a State, in the exercise of its police power, may forbid the use of natural gas for products, such as carbon black, in the production of which such gas is burned without fully utilizing for other manufacturing or domestic purposes the heat therein contained. 84 Likewise, for the purpose of regulating and adjusting coexisting rights of surface owners to underlying oil and gas, it is within the power of a State to prohibit the operators of wells from allowing natural gas, not conveniently necessary for other purposes, to come to the surface without the lifting power having been utilized to produce the greatest quality of oil in proportion. 85
Protection of Property and Agricultural Crops .--An ordinance conditioning the right to drill for oil and gas within the city limits upon the filing of a bond in the sum of $200,000 for each well, to secure payment of damages from injuries to any persons or property resulting from the drilling operation, or maintenance of any well or structure appurtenant thereto, is consistent with due process of law and is not rendered unreasonable by the requirement that the bond be executed, not by personal sureties, but by a bonding company authorized to do business in the State. 86 On the other hand, a Pennsylvania statute, which forbade the mining of coal under private dwellings or streets of cities by a grantor that had reserved the right to mine, was viewed as restricting the use of private property too much and hence as a denial of due process and a ''taking'' without compensation. 87 Years later, however, a quite similar Pennsylvania statute was upheld, the Court finding that the new law no longer involved merely a balancing of private economic interests, but instead promoted such ''important public interests'' as conservation, protection of water supplies, and preservation of land values for taxation. 88 Also distinguished from Pennsylvania Coal was a challenge to an ordinance prohibiting sand and gravel excavation near the water table and imposing a duty to refill any existing excavation below that level. The ordinance was upheld; the fact that it prohibited a business that had been conducted for over 30 years did not give rise to a taking in the absence of proof that the land could not be used for other legitimate purposes. 89
A statute requiring the destruction of cedar trees within two miles of apple orchards in order to prevent damage to the orchards caused by cedar rust was upheld as not unreasonable even in the absence of compensation. Apple growing being one of the principal agricultural pursuits in Virginia and the value of cedar trees throughout the State being small as compared with that of apple orchards, the State was constitutionally competent to require the destruction of one class of property in order to save another which, in the judgment of its legislature, was of greater value to the public. 90 Similarly, Florida was held to possess constitutional authority to protect the reputation of one of its major industries by penalizing the delivery for shipment in interstate commerce of citrus fruits so immature as to be unfit for consumption. 91
Water .--A statute making it unlawful for a riparian owner to divert water into another State was held not to deprive the owner of property without due process of law. ''The constitutional power of the State to insist that its natural advantages shall remain unimpaired by its citizens is not dependent upon any nice estimate of the extent of present use or speculation as to future needs. . . . What it has it may keep and give no one a reason for its will.'' 92 This holding has since been disapproved, but on interstate commerce rather than due process grounds. 93 States may, however, enact and enforce a variety of conservation measures for the protection of watersheds. 94
Fish and Game .--A State has sufficient control over fish and wild game found within its boundaries 95 that it may regulate or prohibit fishing and hunting. 96 For the effective enforcement of such restrictions, a state may also forbid the possession within its borders of special instruments of violations, such as nets, traps, and seines, regardless of the time of acquisition or the protestations of lawful intentions on the part of a particular possessor. 97 The Court also upheld a state law, designed to conserve for food fish found within its waters, restricting a commercial reduction plant from accepting more fish than it could process without deterioration, waste, or spoilage, and applying such restriction to fish imported into the State. 98
The Court's early decisions rested on the legal fiction that states owned the fish and wild game within their borders, hence could reserve these possessions solely for use by their own citizens. The Court soon backed away from the ownership fiction, 99 and in Hughes v. Oklahoma 100 overruled Geer v. Connecticut, indicating instead that state conservation measures discriminating against out-of-state persons were to be measured under the commerce clause. Although a state's ''concerns for conservation and protection of wild animals'' were still a ''legitimate'' basis for regulation, these concerns could not justify disproportionate burdens on interstate commerce. 101 More recently still, in the context of recreational rather than commercial activity, the Court reached a result more deferential to state authority, holding that access to recreational big game hunting is not within the category of rights protected by the Privileges and Immunitites Clause, and that consequently a state could without differential cost justification charge out-of-staters significantly more than in-staters for a hunting license. 102 Suffice it to say that similar cases involving a state's efforts to reserve its fish and game for its own inhabitants are likely to be challenged under commerce or privileges and immunities principles, rather than under substantive due process.
Zoning and Similar Actions .--That states and municipal subdivisions may zone land for designated uses is now a well established aspect of the police power. Zoning authority gained judicial recognition early in the 20th century. Initially, analogy was drawn to public nuisance law, the Court recognizing that States and their municipal subdivisions may declare that in particular circumstances and in particular localities specific businesses, which are not nuisances per se, are to be deemed nuisances in fact and in law. 103 Thus, a State may declare the emission of dense smoke in populous areas a nuisance and restrain it; regulations to that effect are not invalid even though they affect the use of property or subject the owner to the expense of complying with their terms. 104 So too, the Court upheld an ordinance that prohibited brickmaking in a designated area, even though the land contained valuable clay deposits which could not profitably be removed for processing elsewhere, was far more valuable for brickmaking than for any other purpose, had been acquired before it was annexed to the municipality, and had long been used as a brickyard. 105
With increasing urbanization and consequent broadening of the philosophy of regulation of land use to protect not only health and safety but also the amenities of modern living, 106 the Court has recognized the discretion of government, within the loose confines of the due process clause, to zone in many ways and for many purposes. The Court will uphold a challengened land-use plan unless it determines that the plan is clearly arbitrary and unreasonable and has no substantial relation to the public health, safety, or general welfare, 107 or unless the plan as applied amounts to a tak ing of property without just compensation. 108 Applying these principles, the Court has held that the creation of a residential district in a village and the exclusion therefrom of apartment houses, retail stores, and billboards is a permissible exercise of municipal power. 109 So too, a municipality restricting housing in a community to one-family dwellings, in which any number of persons related by blood, adoption, or marriage could occupy a house but only two unrelated persons could do so, was sustained in the absence of any showing that it was aimed at the deprivation of a ''fundamental interest.'' 110 Such a fundamental interest was found impaired by a zoning ordinance in Moore v. City of East Cleveland, 111 which restricted housing occupancy to a single family but so defined ''family'' that a grandmother who had been living with her two grandsons of different children was in violation of the ordinance. Similarly, black persons cannot be forbidden to occupy houses in blocks where the greater number of houses are occupied by white persons, or vice versa. 112 But aside from such basic constraints, a wide range of regulation is permissible. Government may regulate the height of buildings 113 and establish building setback requirements. 114 The preservation of open spaces, through density controls and restrictions on the numbers of houses, 115 and the preservation of historic structures 116 are also permissible utilizations of the zoning power.
In one aspect of zoning--the degree to which such decisions may be delegated to private persons--the Court has not attained consistency. Thus, it invalidated a city ordinance which conferred the power to establish building setback lines upon the owners of two thirds of the property abutting any street, 117 and, subsequently, it struck down an ordinance which permitted the establishment of philanthropic homes for the aged in residential areas but only upon the written consent of the owners of two-thirds of the property within 400 feet of the proposed facility. 118 In a decision falling chronologically between these two, it sustained an ordinance which permitted property owners to waive a municipal restriction prohibiting the construction of billboards. 119 In its most recent decision, upholding a city charter provision permitting the petitioning to citywide referendum of zoning changes and variances by the city planning commission and necessitating a 55% approval vote in the referendum to sustain the commission's decision, the Court distinguished between delegating to a small group of affected landowners such a decision relating to other people and the people's retention of the ultimate legislative power in themselves which for convenience they had delegated to a legislative body. 120 The zoning power may not be delegated to a church, the Court invalidating under the Establishment Clause a state law permitting any church to block issuance of a liquor license for a facility to be operated within 500 feet of the church. 121
Estates, Succession, Abandoned Property .--The Court upheld a New York Decedent Estate Law that granted to a surviving spouse a right of election to take as in intestacy, as applied to a widow who, before enactment of the law, had waived any right to her husband's estate. Impairment of the widow's waiver by subsequent legislation did not deprive the husband's estate of property without due process of law. Because rights of succession to property are of statutory creation, the Court explained, New York could have conditioned any further exercise of testamentary power upon the giving of right of election to the surviving spouse regardless of any waiver however formally executed. 122
Even after the creation of a testamentary trust, a State retains the power to devise new and reasonable directions to the trustee to meet new conditions arising during its administration, especially such as the Depression presented to trusts containing mortgages. Accordingly, no constitutional right is violated by the retroactive application to an estate on which administration had already begun of a statute which had the effect of taking away a remainderman's right to judicial examination of the trustee's computation of income. Under the peculiar facts of the case, however, the remainderman's right had been created by judicial rules promulgated after the death of the decedent, so the case is not precedent for a broad rule of retroactivity. 123
States have several jurisdictional bases for application of escheat and abandoned property laws to out-of-state corporations. Application of New York's Abandoned Property Law to insurance policies on the lives of New York residents issued by foreign corporations did not deprive such companies of property without due process, where the insured persons had continued to be New York residents and the beneficiaries were resident at the maturity date of the policies. The relationship between New York and its residents who abandon claims against foreign insurance companies, and between New York and foreign insurance companies doing business therein, is sufficiently close to give New York jurisdiction. 124 In Standard Oil Co. v. New Jersey, 125 a divided Court held that due process is not violated by a statute escheating to the State shares of stock in a domestic corporation and unpaid dividends declared thereon, even though the last known owners were nonresidents and the stock was issued and the dividends were held in another State. The State's power over the debtor corporation gives it power to seize the debts or demands represented by the stock and dividends.
The large discretion the States possess to define abandoned property and to provide for its disposition is revealed in Texaco v. Short. 126 There upheld was an Indiana statute which terminated interests in coal, oil, gas, or other minerals which have not been used for twenty years and which provided for reversion to the owner of the interest out of which the mining interests had been carved. With respect to interests existing at the time of enactment, the statute provided a two-year grace period in which owners of mineral interests that were then unused and subject to lapse could preserve those interests by filing a claim in the recorder's office. The ''use'' of a mineral interest which could prevent its extinction included the actual or attempted extraction of minerals, the payment of rents or royalties, and any payment of taxes. Merely filing a claim with the local recorder would preserve the interest. The statute provided no notice, save for its own publication, to owners of interests, nor did it require surface owners to notify owners of mineral interests that the interests were about to expire. By a narrow margin, the Court sustained the statute, holding that the State's interest in encouraging production, securing timely notices of property ownership, and settling property titles provided a basis for enactment, and finding that due process did not require any actual notice to holders of unused mineral interests. Property owners are charged with maintaining knowledge of the legal conditions of property ownership. The act provided a grace period and specified several actions which were sufficient to avoid extinguishment. The State ''may impose on an owner of a mineral interest the burden of using that interest or filing a current statement of interests'' and it may similarly ''impose on him the lesser burden of keeping informed of the use or nonuse of his own property.'' 127
[Footnote 79] Thompson v. Consolidated Gas Co., 300 U.S. 55, 76 -77 (1937) (citing Ohio Oil Co. v. Indiana (No. 1), 177 U.S. 190 (1900)); Lindsley v. Natural Carbonic Gas Co., 220 U.S. 61 (1911); Oklahoma v. Kansas Natural Gas Co., 221 U.S. 229 (1911).
[Footnote 81] Railroad Comm'n v. Rowan & Nichols Oil Co., 310 U.S. 573 (1940). See also Railroad Comm'n v. Rowan & Nichols Oil Co., 311 U.S. 570 (1941); Railroad Comm'n v. Humble Oil & Ref. Co., 311 U.S. 578 (1941).
[Footnote 94] See, e.g., Perley v. North Carolina, 249 U.S. 510 (1919) (upholding law requiring the removal of timber refuse from the vicinity of a watershed to prevent the spread of fire and consequent damage to such watershed).
[Footnote 98] Bayside Fish Co. v. Gentry, 297 U.S. 422 (1936). See also New York ex rel. Silz v. Hesterberg, 211 U.S. 31 (1908) (upholding law proscribing possession during the closed season of game imported from abroad).
[Footnote 99] See, e.g., Foster-Fountain Packing Co. v. Haydel, 278 U.S. 1 (1928) (invalidating Louisiana statute prohibiting transportation outside the state of shrimp taken in state waters, unless the head and shell had first been removed); Toomer v. Witsell, 334 U.S. 385 (1948) (invalidating law discriminating against out-of-state commercial fishermen); Douglas v. Seacoast Products, 431 U.S. 265, 284 (1977) (state could not discriminate in favor of its residents against out-of- state fishermen in federally licensed ships).
[Footnote 101] Id. at 336, 338-39.
[Footnote 103] Reinman v. City of Little Rock, 237 U.S. 171 (1915) (location of a livery stable within a thickly populated city ''is well within the range of the power of the state to legislate for the health and general welfare''). See also Fischer v. St. Louis, 194 U.S. 361 (1904) (upholding restriction on location of dairy cow stables); Bacon v. Walker, 204 U.S. 311 (1907) (upholding restriction on grazing of sheep near habitations).
[Footnote 106] Cf. Developments in the Law-Zoning, 91 Harv. L. Rev. 1427 (1978).
[Footnote 107] Village of Euclid v. Ambler Realty Co., 272 U.S. 365 (1926); Zahn v. Board of Pub. Works, 274 U.S. 325 (1927); Nectow v. City of Cambridge, 277 U.S. 183 (1928); Cusack Co. v. City of Chicago, 242 U.S. 526 (1917); St. Louis Poster Adv. Co. v. City of St. Louis, 249 U.S. 269 (1919).
[Footnote 111] 431 U.S. 494 (1977). A plurality of the Court struck down the ordinance as a violation of substantive due process, an infringment of family living arrangements which are a protected liberty interest, id. at 498-506, while Justice Stevens concurred on the ground that the ordinance was arbitrary and unreasonable. Id. at 513. Four Justices dissented. Id. at 521, 531, 541.
[Footnote 119] Thomas Cusack Co. v. City of Chicago, 242 U.S. 526 (1917). The Court thought the case different from Eubank, because in that case the ordinance established no rule but gave to decision of a narrow segment of the community the force of law, whereas in Cusack the ordinance barred the erection of any billboards but permitted the prohibition to be modified by the persons most affected. Id. at 531.
[Footnote 124] Connecticut Ins. Co. v. Moore, 333 U.S. 541 (1948). Justices Jackson and Douglas dissented on the ground that New York was attempting to escheat unclaimed funds not actually or constructively located in New York, and which were the property of beneficiaries who may never have been citizens or residents of New York.
[Footnote 127] Id. at 538. The four dissenters thought that some specific notice was required for persons holding before enactment. Id. at 540.