Nollan v. California Coastal Commission

James and Marilyn Nollan owned a beachfront lot in Ventura County, California, with a small bungalow that they wanted to demolish and replace with a larger three-bedroom house. The property was located between two public beaches and was visible from a public road.

The California Coastal Commission granted the Nollans a permit to demolish the existing structure and build the new house, but conditioned the permit on their agreement to allow the public an easement to pass across their beach property. This easement would connect the two public beaches on either side of the Nollans' property.

The Commission justified the condition by arguing that the new house would increase blockage of the view of the ocean from the road and would contribute to a "wall" of residential structures that would prevent the public from realizing that a public beach was nearby. The Nollans challenged the condition as an unconstitutional taking of their property.

Justice Scalia, writing for the majority, established the essential nexus test through several key points:

• Physical Taking: The required easement constituted a permanent physical occupation of the Nollans' property, which is a per se taking under Loretto v. Teleprompter Manhattan CATV Corp.
• Essential Nexus Test: The condition must substantially advance the same interest that would justify denying the permit outright. Here, the Commission's concern was visual access to the beach, but the easement provided physical access
• Lack of Connection: A lateral easement along the beach does not address the problem of visual blockage from the road. The easement serves a different governmental purpose than the one cited to justify the condition
• Extortion Prevention: Without the nexus requirement, government could leverage its permit authority to obtain property interests that it could not acquire through eminent domain without paying just compensation

The Court emphasized that the government cannot evade the compensation requirement of the Fifth Amendment by conditioning permits on property dedications that do not address the specific problems created by the proposed development.

The decision established that permit conditions involving property dedications must be analyzed as potential takings, not merely as exercises of the police power, when they lack sufficient connection to the permit's purpose.

Nollan v. California Coastal Commission has had significant impact on land use regulation and property rights:

• Essential Nexus Test: Established the requirement that permit conditions must be substantially related to the governmental interest justifying the permit denial
• Conditional Takings Doctrine: Created framework for analyzing when permit conditions constitute takings requiring compensation
• Exaction Limitations: Limited government's ability to extract property dedications through the permit process without clear justification
• Property Rights Protection: Strengthened constitutional protection against regulatory overreach in land use planning
• Foundation for Dolan: Provided the foundation for the later Dolan v. City of Tigard decision, which added the "rough proportionality" requirement

The case has been influential in challenging excessive permit conditions and has led to more careful scrutiny of government exactions. Together with Dolan, it forms the core of the unconstitutional conditions doctrine in land use law.