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The Ninth Circuit Court of Appeals held that an Arizona court's arbitration appointment system, whereby attorneys are required to serve as arbitrators for up to two days a year, does not constitute a taking that triggers the constitutional requirement of just compensation.
In Scheehle v. Justices of Supreme Court of Arizona, No. 05-17063, 2007 WL 3377965 (9th Cir. Nov. 15, 2007), Scheehle, an Arizona attorney, challenged an arbitrator appointment system used by an Arizona trial court whereby experienced attorneys are required to serve as arbitrators (for $75 per day) for up to two days a year. Specifically, Scheehle argued that the service requirement constituted an unconstitutional taking. The district court ruled that the system did not constitute a taking.
On appeal, the Court held that the arbitration appointment system did not constitute a regulatory taking under the Penn Central test. Penn Central Transportation Company v. City of New York, 438 U.S. 104 (1978). In reaching this holding, the Court found that (1) the economic impact on Scheehle was negligible because he was only required to work a maximum of two days a year; (2) the requirement did not interfere with Scheehle's "distinct investment-backed expectations" because his membership in the bar required him to serve as an officer of the court; and (3) there was no suggestion that the "two-day obligation remotely outweighs the benefits conferred by admission to the practice of law."
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