THE PENN CENTRAL TEST AND
TENSIONS IN LIBERAL PROPERTY THEORY
Eric R. Claeys*
This Article uses background theories of property and government to
provide a partial explanation of the Supreme Court’s precedent on regula-
tory takings. The author advances two theses. First, the Penn Central test is
not as ad hoc and case-speciªc as is often assumed: although the three fac-
tors in this test can each vary sharply in application, the different factors
are regularly construed together to advance one of two theories of govern-
ment—a “classical” theory, reºecting commitments of classical liberalism,
and a “modern” theory, reºecting the commitments associated with a cen-
tralized regulatory state. Second, the Court’s most moderate Justices have
used one or the other of these two theories depending on factors including:
whether the right allegedly taken is essential to the species of property to
which it is attached; whether legal precedent has historically treated that
right as essential to the species of property in question; and how compelling
the reasons to regulate potential abuses of that property right are. While these
insights by no means explain regulatory takings doctrine completely, they are
two signiªcant contributing factors in any comprehensive explanation.
Introduction
This Article aims to clear up some of the “muddle”1 that confuses
contemporary federal regulatory-takings law. In its decision in Penn Cen-
tral Transportation Co. v. City of New York, the Supreme Court confessed
that its regulatory-takings doctrine is “ad hoc.”2 As most practitioners
appreciate, however, this confession is not entirely accurate. Most of the
Court’s regulatory-takings decisions lean toward one of two theoretical
extremes. In one, the Court sounds formalistic, libertarian, and insistent
that compensation be made though the heavens may fall. In the other, the
Court seems realistic and greatly concerned that takings law not stymie
government action. As two commentators have observed, the Court “has
s