Good Jr. v. U.S.

• Decision Date: 31 August 1999
• Citation: 189 F.3d 1355
• Parties: (Fed. Cir. 1999) LLOYD A. GOOD, JR., Plaintiff-Appellant, v. UNITED STATES, Defendant-Appellee. 97-5138 DECIDED:
• Court: U.S. Court of Appeals — Federal Circuit

Page 1355

189 F.3d 1355 (Fed. Cir. 1999)

LLOYD A. GOOD, JR., Plaintiff-Appellant, v. UNITED STATES, Defendant-Appellee.

97-5138

United States Court of Appeals for the Federal Circuit

DECIDED: August 31, 1999

Appealed from: United States Court of Federal Claims Judge James F. Merow

Richard R. Nageotte, Nageotte, Nageotte & Nageotte, of Stafford, Virginia, argued for plaintiff-appellant. Of counsel was John G. Roberts, Jr., Hogan & Hartson, of Washington, DC.

Ethan G. Shenkman, Attorney, Appellate Section, Environment and Natural Resources Division, Department of Justice, of Washington, DC, argued for defendant-appellee. With him on the brief were Lois J. Schiffer, Assistant Attorney General, Robert L. Klarquist, and Dorothy R. Burakreis, Attorneys.

Glenn P. Sugameli, National Wildlife Federation, of Washington, DC, for amicus curiae The National Wildlife Federation. Of counsel on the brief was James B. Dougherty, of Washington, DC.

James S. Burling, Pacific Legal Foundation, of Sacramento, California, for amicus curiae Pacific Legal Foundation. With him on the brief was Peter G. Gioia, Pacific Legal Foundation, of Stuart, Florida.

John D. Echeverria, Georgetown University Law Center, of Washington, DC, for amicus curiae Florida Audubon Society.

Before NEWMAN, Circuit Judge, SMITH, Senior Circuit Judge, and GAJARSA, Circuit Judge.

SMITH, Senior Circuit Judge.

This is a regulatory takings case. Lloyd A. Good, Jr. sued the federal government on the basis that it effectively took his property without just compensation when the U.S. Army Corps of Engineers denied him permission to dredge and fill on land he owns in the Florida Keys. The U.S. Court of Federal Claims granted summary judgment to the United States. Lloyd A. Good, Jr. v. United States, 39 Fed. Cl. 81 (1997). We affirm.

Facts

Lloyd A. Good, Jr. ("Good") and his mother purchased a forty-acre tract of undeveloped land on Lower Sugarloaf Key, Florida, in 1973,¹ as part of a much larger real estate purchase. The tract, known as Sugarloaf Shores, consists of thirty-two acres of wetlands (a combination of salt marsh and freshwater marsh) and eight acres of uplands. The sales contract for the land stated that:

The Buyers recognize that certain of the lands covered by this contract may be below the mean high tide line and that as of today there are certain problems in connection with the obtaining of State and Federal permission for dredging and filling operations.

Good's efforts to develop the property began in 1980, when he hired Keycology, Inc., a land planning and development firm, to obtain the federal, state, and county permits necessary to develop Sugarloaf Shores into a residential subdivision. In their contract, Good and Keycology acknowledged that "obtaining said permits is at best difficult and by no means assured."

Good submitted his first permit application to the U.S. Army Corps of Engineers ("Corps") in March 1981. The Corps permit was required for dredging and filling navigable waters of the United States, including wetlands adjacent to navigable waters, under the Rivers and Harbors Act of 1899² and under § 404 of the Clean Water Act.³ Good proposed filling 7.4 acres of salt marsh and excavating another 5.4 acres of salt marsh in order to create a 54-lot subdivision and a 48-slip marina. The Corps granted the requested permit in May 1983. Good modified the permit in response to county environmental concerns and the modified permit was issued January 6, 1984. Under both permits, the authorized work had to be completed within five years. See 33 CFR § 325.6 (1998).

Good and Keycology were also pursuing the required state and county permits. In February 1983, the state Department of Environmental Regulation issued a permit for the requested dredging and filling. The state permit was conditioned, however, on Good obtaining county approval for the project.

On May 10, 1983, Good applied for county approval of the dredge-and-fill proposal that had been approved by the federal and state permits. The county determined that the plan was a "major development" subject to a more stringent environmental review than under standard procedures. After Good appealed the "major development" determination, the County Commission ordered the county to process the permit application under standard review procedures. The county granted Good's permit on July 13, 1984.

At this point, Good had received federal, state, and county approval to develop the property. Florida law, however, presented one more hurdle, in the form of the Environmental Land and Water Management Act, Fla. Stat. Ann. §§ 380.012 to 380.12 (West 1997). The Act created a statutory regime for regulating development in Areas of Critical State Concern, including the entire Florida Keys.⁴ Under the Act, the Florida Department of Community Affairs ("DCA") reviews local land development orders in Areas of Critical State Concern and may appeal those orders to the Florida Land and Water Adjudicatory Commission ("FLAWAC").⁵ See Fla. Stat. Ann. § 380.07 (West 1997). On September 10, 1984, the DCA appealed the county's approval of Good's dredge-and-fill project. FLAWAC held that the county had erred in subjecting Good's plan only to the standard review, and on May 29, 1986 ordered the county to review the project as a "major development."

Making matters worse for Good, the county in the meantime had adopted a new land use plan and new development regulations. The new regulations prohibited dredging to provide access to docks, prohibited filling of salt marsh for building sites, and limited filling of salt marsh to 10% of the salt marsh on a parcel. Monroe County, Fla. Code, art. II, § 9.5-345 (1986). Since Good's plan involved dredging to provide boat access between the proposed marina and Upper Sugarloaf Sound, and required filling roughly 25% of the parcel's salt marsh to provide building sites, Good's project would not have been allowed under the new regulations.

Good filed suit in state court, alleging that the state had taken his property without just compensation and that FLAWAC's order was an unreasonable exercise of police power. That suit was settled on October 22, 1987. The consent decree provided that Good's application would be evaluated under the repealed major development review standard but that any future development of Sugarloaf Shores would be subject to later-enacted land use regulations.

Good's efforts to get state and county approval for his project had used up most of the five-year time limit on the federal permits issued in 1983 and 1984. Good therefore requested that the Corps extend the time limits of the permits. The Corps denied Good's request to reissue the permits without changes, but granted a new permit allowing substantially the same development on October 17, 1988.

The county gave preliminary approval to Good's plan on November 9, 1989. Final county approval, however, was subject to fifteen conditions, the most significant of which was approval of the project by the South Florida Water Management District (SFWMD).

Good filed an application with SFWMD. A few months later, SFWMD notified Good that its staff recommended denying the application, based on "the unmitigated loss of wetlands, the loss of habitat for the endangered species within them [i.e., the state-listed mud turtle and Lower Keys marsh rabbit] and the lack of reasonable assurance that future unmitigated wetlands destruction will not occur due to the lack of the above-requested dedication." In view of this negative review, Good requested that his application be removed from SFWMD's agenda. He never reactivated the application or otherwise obtained SFWMD approval for his project.

Apparently despairing of ever obtaining approval for his 54-lot plan, Good submitted a new, scaled-down plan to the Corps in July 1990. In this 1990 permit application, Good proposed building only sixteen homes, together with a canal and tennis court. Although the new plan greatly reduced the overall number of houses, it located all of them in the wetlands area. The overall wetlands loss, therefore, was only reduced from 10.53 acres to 10.17 acres.

Between the time the Corps issued Good's 1988 permit and the time he applied for the 1990 permit, the Lower Keys marsh rabbit was listed as an endangered species under the Endangered Species Act ("ESA"). See 16 U.S.C. § 1533 (1994); 55 Fed. Reg. 25,588 (June 21, 1990). The Corps was therefore required to consult with the Fish and Wildlife Service ("FWS") to insure that issuing the requested permit would not place the continued existence of the species in jeopardy. See 16 U.S.C. § 1536(a)(2) (1994).

Under this so-called "section 7 consultation," FWS prepared a biological opinion as to whether the proposed permit would put the rabbit in jeopardy. In its biological opinion, issued February 19, 1991, FWS concluded that the project proposed in Good's 1990 permit application would not jeopardize the continued existence of the marsh rabbit. Nevertheless, it recommended denial of the permit based on the development's overall environmental impact.⁶

The FWS biological opinion also instructed the Corps to notify Good not to proceed under his 1988 permit. The 1988 permit had been issued before the marsh rabbit was listed as an endangered species and proposed a different project than the 1990 permit application. Therefore, the FWS "no jeopardy" finding did not apply to the earlier permit, and development pursuant to the 1988 permit could violate the ESA.

On May 14, 1991, the Corps notified FWS that Good intended to proceed with the project allowed by the 1988 permit. The Corps also noted that it did not believe the project would jeopardize the marsh rabbit, but noted that the silver rice rat had been listed as an endangered species subsequent to the FWS biological opinion on the 1990 permit application. See 56 Fed. Reg. 19,809 (April 30, 1991).

In response, FWS initiated consultation...