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Like so many precedent setting cases this one has rather humble beginnings. The Nollans originally leased the subject property which is located in Ventura County. The property is located a quarter mile from one public beach and 1,800 feet from another. A 504 square foot bungalow, which they used primarily as a holiday home, was located on the lot. The bungalow had fallen into disrepair when the Nollans entered into a purchase option on the condition that they demolish and replace it. On 25 February

1982 they made application to the California Coastal Commission, as required under California statute, for a two storey, three bedroom house in keeping with the neighbourhood. The Commission conditioned their approval on the dedication of a ten foot wide lateral access easement,

bounded by the mean high tide line and their seawall, to facilitate movement between the two public beaches (Michelman,1987, 1605-6, 1098, Nollan, 483 U.S., 1987, 3141-4, Roddewig and Durken, 1989, 6-7).

On 3 June 1982 the Nollans filed a petition to invalidate the condition,

arguing that it could not be imposed without evidence that their house would have an adverse impact on public access to the beach. The Ventura County Superior Court agreed. The issue was returned to the Coastal Commission. At a public hearing, the Commission reaffirmed its position that the new house would contribute to a wall of development that reduced the public's visual and "psychological" access to the beach. The "burden to the public's ability to traverse to and along the shoreline" created by the new house was to be offset by the access easement. The Commission had applied similar conditions to forty-three of the sixty-nine coastal lots in the area. Of the seventeen without the condition, fourteen had been approved prior to the

inception of the Commission and the remaining three were not shore-front lots (Nollan, 483 U.S.. 3134, 1987).

The Nollans petitioned the Superior Court of California on the grounds that the condition violated the takings clause of the Fifth Amendment to the United States Constitution. The court ruled in favour of the Nollans on statutory grounds. The court held that under the California Coastal Act of 1976 the Commission could impose access conditions if there was an adverse impact on public access to the sea. In the court's view the

administrative record was not adequate to concluded that the new house would create a such a burden. Having made this ruling the court found it unnecessary to rule on the constitutional issue (Harvard Law Review, 1987, 243-4, Nollan, 483 U.S., 1987, 3134-5).

The Commission appealed the decision to the California Court of Appeal. While that decision was pending the Nollans demolished the bungalow and built a new house without informing the Commission. The Superior Court decision was reversed. The Court of Appeal found that a coastal permit was required as the new house was more than ten percent iarger than the

bungalow and a condition that an access easement be granted could be imposed. On the basis of on the earlier Court of Appeal ruling in Grupe v California Coastal Commission (1985) the court held that the requirement did not violate the Constitution. In Grupe, the court had found that as long as a development contributed to the need for public access, even if indirectly, the imposition of the access easement was constitutional. The Nollan claim also failed because although the access easement diminished the value of their lot, they were left with a reasonable economic use (Harvard Law Review. 1987, 243-4, Nolian, 483 U.S., 1987, 3134-5).

The Nollans then appealed to the United States Supreme Court which reversed the lower court decision. Justice Scalia, writing for the five justice majority, stated that had the Commission demanded the outright granting of the easement there "no doubt would have been a taking." Beginning with the 1982 decision in Loretto v Teieprompter Manhattan CATV Corporation

the Court had consistentiy held that "the right to exciude [others is] 'one of the most essential sticks in the bundle of rights that are commonly

characterized as property.'" There can not be a permanent physical occupation of property, regardless of the extent of the occupation and whether or not it achieves an important public purpose. Here a permanent

physical occupation occurred even though no individual would be permanently stationed on the property (Harvard Law Review. 1987, 244, Nollan, 483 U.S., 1987, 3135-6).

Requiring dedication of an easement without compensation would violate the Fifth Amendment. Therefore, question then became whether such a dedication imposed as a condition of a grant of planning permission would also be a taking. Justice Scalia asserted that the Court had:

long recognized that land-use regulation does not effect a taking if it 'substantially advance[s] legitimate state interests' and does not 'den[y] an owner economically viable use of his land.'

However, previous cases had not set standards for the connection between legitimate state interests and land-use regulations. In this case the Coastal Commission argued that protecting the public's visual and "psychological" access to the beach was a legitimate state interest. The Court assumed this to be so. The Commission would have been within their constitutional rights to deny a permit for the house if it would have blocked views, unless this would have left the Nollans without an economically viable use of their property. The Commission went on to argue that the access easement served the same purpose. The Court held that a height limit or a condition requiring a public viewing spot would have been constitutional. The access easement, however, was not sufficiently related to the legitimate government purpose of visual and "psychological" access. Therefore, it failed to meet "even the most untailored standards." In short, there was no "essential nexus", or connection. Unless the condition served the same purpose as a building restriction it was not a valid exercise of the police power, but was a taking (Harvard Law Review, 1987, 244, Nollan, 483 U.S., 1987, 3147-8).

In their dissents. Justices Brennan and Marshall asserted that the access requirement imposed by the Commission was not irrational. Rather, the Commission had sought to offset the visual and "psychological" barrier created by the new house with public access across the property. They felt that the standard imposed by the Court was too precise and out of line with previous rulings. The justices rejected the contention that land-use

regulations must be "substantially related" to a legitimate government

purpose, rather a state's exercise of its police powers demands only that the state "could rationally have decided" that the measure adopted might

a decision that would have allowed the State of California to deny the permit for a house, but denied them the power to Impose a condition that would have served the Interests of both the Nollans and the public. Justice

Blackmum also dissented, disagreeing with the majority's strict correlation. He felt that the Commission had been constitutional In their exercise of the police power. There was only a minimal physical Intrusion and no

Investment backed expectations had been diminished as a result of the condition. The Nollans also had known about the dedication requirement before they purchased the property. In his dissent Justice Stevens warned that public officials would need to be Increasingly aware of vague standards In their regulations (Harvard Law Review, 1987, 245, Nollan, 483 U.S., 1987, 3150-64).