Background
McDaniel Jones, LLC bought a 1.86-acre Greenville parcel for $1.43 million and proposed dividing it first into seven lots and then six. The revised plan preserved a magnolia tree through a conservation easement, but neighbors objected based on traffic, drainage, tree canopy, neighborhood character, and property values. The Greenville Planning Commission indicated it could approve five lots; the developer declined to reduce the plan, and the commission denied the application because the proposed lot sizes and configuration were incompatible with surrounding development.
A circuit court upheld that land-use decision, and McDaniel did not appeal. It sold the parcel for $1.4 million and later sued, asserting that the denial effected a regulatory taking under the Fifth Amendment and denied equal protection under the Fourteenth Amendment. The master-in-equity granted summary judgment to the commission. The appeal required the Court of Appeals to apply the fact-intensive Penn Central test for a regulation that leaves economically beneficial use, and rational-basis review to the selective-treatment claim.
McDaniel emphasized the projected proceeds from a six-lot project and a different subdivision that the commission had approved. The city pointed to the parcel’s continued value, the possibility of a five-lot plan, and physical differences between the two projects. The prior circuit-court ruling had also determined that the governing Greenville ordinance gave the commission discretion to assess neighborhood compatibility. With the material facts stipulated, the appellate dispute turned on the legal significance of those facts rather than a trial-worthy conflict over what the commission did.
The Court’s Holding
The Court of Appeals affirmed. On economic impact, the relevant unit was the parcel as a whole—not the value of the single lot the developer said it lost. The property retained substantial market value, could still be developed in other ways, and sold for only slightly less than its purchase price. On investment-backed expectations, McDaniel bought land subject to an ordinance allowing the commission to assess compatibility and had no entitlement to assume that a preferred six-lot configuration would be approved. The commission also offered a five-lot path rather than barring development.
The character of the government action likewise favored the city because the compatibility review was a generally applicable land-use process, not a physical occupation or a measure singling out the owner to confer a private benefit elsewhere. The equal-protection claim also failed. Another project was not similarly situated in all relevant respects, and this parcel’s street frontage, curb cuts, traffic setting, and historic magnolia supplied rational distinctions. Public concerns could support a zoning decision, and McDaniel produced no evidence that the commission acted with a discriminatory purpose.
Key Takeaways
- Penn Central measures economic impact against the parcel as a whole, not the projected value of one proposed lot.
- A developer’s expectations are weaker when existing ordinances give the planning body compatibility discretion and a less intensive project remains available.
- A class-of-one equal-protection theory requires truly comparable properties plus evidence negating rational grounds for different treatment.
Why It Matters
The unreported decision synthesizes recent South Carolina regulatory-takings authority for local land-use disputes. Developers should evaluate the purchase price, post-decision market value, remaining permitted uses, and the ordinance in effect at acquisition before treating a denied configuration as a compensable taking. They should also create a record explaining why proposed comparators match the parcel on access, physical features, neighborhood effects, and applicable standards.
For municipalities, the ruling reinforces the value of a written decision tied to ordinance criteria and site-specific facts. Offering an approvable alternative can help demonstrate that the government has regulated rather than confiscated. Still, commissions should not rely on generalized opposition alone; minutes and denial letters should connect public concerns such as stormwater, traffic, and compatibility to the governing standards and the particular property. Counsel should preserve appraisal evidence and identify the full range of uses remaining after a denial, because both points shape the Penn Central analysis.