Master Foundational regulatory takings case holding that a regulation that goes too far is a taking requiring just compensation. with this comprehensive case brief.
Pennsylvania Coal v. Mahon is the case that launched modern regulatory takings doctrine. Before Mahon, the prevailing view was that the state’s police power could impose substantial limits on property use without compensation so long as the aim was to protect public health, safety, morals, or welfare. Justice Holmes’s majority opinion reframed the inquiry: if a regulation so diminishes private property rights that it effectively appropriates them, the Constitution treats it as a taking, even without formal expropriation. His now-famous line—"a regulation that goes too far will be recognized as a taking"—marks the birth of the regulatory takings concept.
Mahon is also significant for highlighting tensions that animate the Takings Clause: the balance between individual property rights and collective welfare, the line between harm-preventing and benefit-conferring regulations, and the role of value diminution, reciprocity of advantage, and nuisance principles. The case foreshadows later doctrinal developments—Penn Central’s multifactor balancing, Lucas’s categorical rule for total economic wipeouts, Loretto’s per se rule for physical occupations, and Keystone’s narrowing of Mahon—while also containing ideas (like conceptual severance of property interests) that later decisions cabined.
260 U.S. 393 (U.S. Supreme Court 1922)
Pennsylvania Coal Company owned subsurface mineral rights (anthracite coal) beneath land in Scranton, Pennsylvania. It had previously conveyed the surface estate to Mahon’s predecessor in title while expressly reserving the right to mine the coal and securing a waiver of surface support in the deed—meaning the surface owner accepted the risk that mining could cause the surface to subside. In 1921, Pennsylvania enacted the Kohler Act, which prohibited mining of anthracite in a manner that would cause subsidence damage to any structure used for human habitation. Pennsylvania Coal notified Mahon that it intended to mine under his property in accordance with its reserved rights and the waiver. Mahon sought an injunction relying on the Kohler Act. The Pennsylvania courts granted the injunction and upheld the statute’s application, effectively preventing the company from mining the coal beneath Mahon’s property. The U.S. Supreme Court granted review to consider whether the Kohler Act, as applied, constituted a taking without just compensation in violation of the Fifth Amendment (as incorporated via the Fourteenth Amendment).
Does a state statute prohibiting coal mining that would cause subsidence of surface structures—thereby destroying the value of a reserved mineral estate and nullifying an express waiver of support—effect a taking of property requiring just compensation under the Fifth Amendment as applied to the states through the Fourteenth Amendment?
While the state may regulate property under its police power to protect public health, safety, and welfare, a regulation that goes too far in diminishing private property rights will be recognized as a taking requiring just compensation. Factors relevant to this determination include the extent of economic diminution, the character of the governmental action (including whether it prevents a noxious use or confers general reciprocity of advantage), and the degree to which the regulation singles out one owner to bear burdens that should be borne by the public.
Yes. As applied to Pennsylvania Coal’s reserved mineral estate and the express waiver of surface support, the Kohler Act went too far and effected a taking, violating the Takings Clause. The injunction enforcing the statute could not be sustained.
Justice Holmes emphasized that regulation can be so onerous that it effectively appropriates property. The Kohler Act did not merely adjust the benefits and burdens of economic life; it destroyed the practical value of Pennsylvania Coal’s support estate and rendered the reserved coal unmineable under the relevant parcel, nullifying contractually negotiated rights. The magnitude of the diminution in value—functionally eliminating the profitable use of that portion of the property—was a critical factor indicating a taking. Holmes distinguished traditional exercises of the police power that prevent harmful or noxious uses (e.g., Mugler and Hadacheck) from regulations that confer benefits on particular private parties without a corresponding reciprocity of advantage. He found the Kohler Act primarily protected private surface owners and buildings rather than abating a public nuisance or addressing a broad public hazard. The Act imposed the burden of supporting surface structures on the coal owner alone, rather than spreading the costs across the public, and it upset settled expectations memorialized in deeds that expressly waived support. While acknowledging that property may be regulated, the Court cautioned that a "strong public desire to improve the public condition" does not authorize the state to "achiev[e] the desire by a shorter cut than the constitutional way of paying for the change." On balance, and as applied to these facts, the extent of economic impact, the character of the regulation (benefiting private surface owners without reciprocal advantage), and the destruction of a distinct property interest compelled the conclusion that the statute went too far. Justice Brandeis dissented, arguing the Act reasonably prevented a harmful use and lay within the state’s police power, and that diminished value alone should not trigger compensation.
Mahon is the cornerstone of regulatory takings law. It introduced the idea that regulations can be takings and identified guideposts—extent of diminution, character of the action, reciprocity of advantage—that later matured into the Penn Central balancing test. It also sparked enduring debates: how to define the relevant parcel (Holmes’s analysis effectively severed the support estate, later constrained by the "parcel as a whole" approach), how to treat harm-preventing regulations (Brandeis’s view resurfaces in Keystone), and when compensation is due for severe value loss (refined in Lucas for total economic wipeouts). For law students, Mahon frames the analytical vocabulary and tensions every takings exam problem invokes.
It signals that there is no categorical line between permissible regulation and compensable taking; instead, courts weigh factors such as the extent of economic diminution, the character of the government action (harm prevention vs. benefit conferral), reciprocity of advantage, and interference with investment-backed expectations. This open-textured standard was later systematized in Penn Central, which formalized a multifactor inquiry, while Lucas and Loretto added categorical rules for total economic wipeouts and permanent physical occupations.
No. The Court held the statute unconstitutional as applied and reversed the injunction. At the time, takings challenges to regulations typically sought invalidation rather than compensation in an inverse condemnation posture. Modern practice often channels such claims into inverse condemnation actions for monetary relief where available under state or federal law.
Penn Central reframed Mahon’s considerations into a balancing test and rejected conceptual severance by emphasizing the "parcel as a whole." Keystone Bituminous Coal v. DeBenedictis distinguished Mahon and upheld a similar Pennsylvania law by focusing on broader public purposes (safety and environmental protection), the widespread distribution of burdens and benefits, and the parcel-as-a-whole approach that showed less severe economic impact. Lucas created a categorical rule for regulations that eliminate all economically beneficial use, narrowing the need to quantify "how far is too far" in those rare cases.
It underscored settled expectations and contractually allocated risk: the surface owner accepted subsidence risk, and the coal company retained a distinct support estate. By nullifying this bargained-for right, the statute effectively appropriated a recognized property interest. Holmes treated the destruction of that specific estate as evidence that the regulation crossed the constitutional line—a move later tempered by the "parcel as a whole" concept to prevent owners from slicing property into segments to magnify impact.
Justice Brandeis’s dissent said yes, analogizing to nuisance-prevention cases where the state may prohibit harmful uses without paying. The majority viewed the Kohler Act as primarily protecting private structures rather than abating a public nuisance affecting the community at large, and as imposing targeted burdens without reciprocal advantage. Keystone later adopted an approach closer to Brandeis’s view when the regulation addressed broad public harms and did not wipe out value when the parcel is viewed as a whole.
Pennsylvania Coal v. Mahon set the constitutional baseline that regulation can be compensable when it so drastically curtails property rights that it is the functional equivalent of appropriation. Holmes’s formulation invited a context-sensitive, fact-intensive inquiry into economic impact and the character of the government action, establishing the intellectual framework for modern takings analysis.
For students, Mahon is both a starting point and a cautionary tale: it supplies the seminal goes too far principle while previewing doctrinal challenges later cases attempt to resolve—defining the relevant parcel, balancing private loss against public gain, and distinguishing harm prevention from benefit conferral. Mastery of Mahon’s reasoning equips you to navigate Penn Central, Lucas, Loretto, and Keystone—and to analyze contemporary land-use regulations through the constitutional lens it created.