Town of Chester v. Laroe Estates, Inc.

LII note: The U.S. Supreme Court has now decided Town of Chester v. Laroe Estates, Inc. .


Under Federal Rules of Civil Procedure, are intervenors participating in a lawsuit required to have Article III standing, or is standing presumed if there is a valid case or controversy between the parties?

Oral argument: 
April 17, 2017

The Supreme Court will consider whether under Federal Rule of Civil Procedure 24(a) intervenors in a lawsuit must have Article III standing or whether a case or controversy between the named parties satisfies Article III. Petitioner, the Town of Chester, argues that courts should not permit parties to intervene in an action unless they can prove they have independent Article III standing, which it argues is required by Federal Rule of Civil Procedure 24. In contrast, Respondent Laroe Estates contends that so long as the initial party who brought the action has Article III standing, other parties can intervene without showing standing. The outcome of this case will have implications for the separation of powers and the potential litigation burdens on courts and parties.

Questions as Framed for the Court by the Parties 

Whether intervenors participating in a lawsuit as of right under Federal Rule of Civil Procedure 24(a) must have Article III standing, or whether Article III is satisfied so long as there is a valid case or controversy between the named parties.


Steven Sherman, now deceased, was a land developer in the Town of Chester who applied in 2000 to subdivide a $2.7 million piece of land that measured close to 400 acres. . Over the next decade, the Town and Sherman went back and forth, with the Town passing new regulations that barred Sherman’s subdivision and Sherman submitting new proposals to satisfy the new regulations. . Eventually, Sherman decided to sell the land to Laroe Estates, Inc. (“Laroe”) instead. Sherman then sued the town in 2012 claiming that the town wrongfully prevented him from developing the land; and, that the town’s actions had amountied to a regulatory taking. The trial court dismissed the regulatory takings claim as unripe in 2013, because the Town had yet to make a final decision on the proposal for the developmental project.

Sherman then appealed this decision, and the Second Circuit reversed the lower court’s dismissal of the takings claim and remanded the case, finding that seeking a final decision from the Town would be futile given the Town’s history of continually changing its regulations to bar Sherman’s proposals. The Court found that Sherman’s initial claims were enough to state a regulatory-takings claim.

Before the District Court had time to take the case up on remand, Laroe notified the District Court of its intent to intervene per Federal Rule of Civil Procedure 24 (“Rule 24”) as of right or, alternatively, by permission. Laroe argued its interest as equitable owner of the land in question, adding that barring its intervention would impair or impede their interest. . Laroe added that it was an adversary to Sherman because of its equal claim that the Town took the property “without just compensation” and because proceeds received from settlement or judgment may not be enough to adequately compensate all parties. The District Court denied Laroe’s motion to intervene, leaving the question of Laroe’s satisfaction of the requirements for intervention under Rule 24 undecided.

Laroe filed an interlocutory appeal, and the Second Circuit vacated the District Court’s decision, noting that a party need not have independent standing to seek intervention. . Rather, the Second Circuit held that the relevant inquiry is whether there exists a case or controversy under Article III, and that once this requirement has been met, other parties can intervene without independent standing. The Second Circuit also denied the Town’s claim that Laroe had failed to state a claim. The court ultimately concluded that the District Court should have focused on the requirements of Rule 24.



The Town of Chester maintains that Article III does not allow courts to consider a claim from a party lacking standing, even if that party is seeking to intervene in a pre-existing action. The Town of Chester asserts that an intervenor as of right must satisfy Article III requirements of standing because otherwise it would be in a better position than the original plaintiff by getting all the benefits of being a party without having to prove standing. To illustrate, the Town of Chester notes that because an intervenor as of right becomes a party to the lawsuit, it can raise new claims and seek new forms of relief. Defendants, the Town argues, would then be forced to expend litigation costs defending themselves against a party who may not even have standing.

Laroe responds that courts have held that so long as the initial plaintiff has Article III standing, potential intervenors asserting identical claims and seeking identical relief are generally allowed to intervene because the claim has already been deemed justiciable through the initial plaintiff’s standing. Laroe maintains that such a proposed intervention does not alter or extend litigation because the course of the litigation can be tied back to the actions of the initial plaintiff. Further, Laroe argues that the requirements of Rule 24 and Article III are separate, and that Rule 24 has no specific standing requirement. .


The Town of Chester argues that even if there is no constitutional requirement for an intervening party to establish Article III standing, Rule 24 requires such a showing. Pointing to the wording of Rule 24 and Supreme Court precedent, the Town contends that the Rule imports the standing requirements of Article III. In fact, the Town argues that the standing tests from Article III and Rule 24 are so similar that lower courts have often found them to be substantially the same. The Town notes that this is a sensible outcome, because an intervening party is given the same rights as the initial parties, and thus should be held to the same requirements.

Laroe responds that Rule 24 does not incorporate Article III’s requirement. Laroe maintains that Rule 24 does not include many of the specific standing requirements from Article III and uses language that is much less strict. Laroe notes that the Article III standing requirements of traceability and redressability are noticeably absent from Rule 24. Laroe argues that Rule 24 is designed to allow parties whose rights are potentially affected by an existing case or controversy to have a say in the adjudication of that case of controversy. Further, Laroe contends that its reading of Rule 24 is supported by the Rule’s goal of judicial efficiency.


The Town of Chester argues that Laroe does not have standing. Further, it notes that both parties agree that the question of whether Laroe has standing is not properly before the Supreme Court.

Laroe argues that even if it is necessary for an intervening party to establish standing, it has standing under both Article III and Rule 24. Laroe explains that it possesses the equitable title to and thus has ownership of the property at issue, which gives it standing to sue the Town for its regulatory taking of the land. Finally, Laroe argues that the issue of whether it has standing should not be decided by the Supreme Court, but rather by the Second Circuit on remand.



The Town of Chester argues that the Article III standing requirement helps to establish the fundamental boundaries of the separation of powers by outlining what falls within a court’s jurisdiction. The Town of Chester maintains that these jurisdictional limitations promote the appropriate balance of power between the three branches of government. If parties were allowed to intervene in cases without standing, the Town of Chester argues that would inappropriately broaden judicial powers. The Town of Chester notes that this undermines the separation of powers, because it would allow courts to make decisions for entities over whom they should not have jurisdiction. Professor Aaron-Andrew P. Bruhl, in support of the Town of Chester, adds that all plaintiffs who bring distinct issues in cases must meet Article III’s standing requirements because allowing one plaintiff to rely solely on the standing of another plaintiff is inconsistent with the fundamentals of the standing requirement. He notes that holding otherwise would allow some plaintiffs with improper standing in cases seeking damages to be awarded money improperly. The Town of Chester elaborates that when an intervenor requests a remedy or brings a claim not previously brought by the named party, that would enable the court to assert power beyond constitutional limits.

Laroe responds that the case-or-controversy requirement of Article III sets the necessary limits on judicial power and maintains the proper balance of power between the governmental branches. After a court has established that a case or controversy exists, Laroe argues that the court possesses the authority to adjudicate the entirety of the claim, even if it involves intervening parties who lack standing. Laroe is careful to note that separation of powers concerns may arise if an intervening party pursues additional claims or relief, but notes that it not a reason to categorically require intervening parties to demonstrate they have standing. Instead, Laroe argues that parties should be allowed to intervene for the same claim and relief and that standing could be addressed later if an intervening party amended its complaint to include new claims or relief.


The Town of Chester argues that allowing entities to intervene in a case without establishing Article III standing would unnecessarily complicate litigation. Further, the Town of Chester states that allowing a party to join litigation without showing it has standing would inappropriately subject the defendant to increased litigation burdens. With regard to judicial efficiency concerns, Professor Aaron-Andrew P. Bruhl, in support of the Town of Chester, maintains that requiring intervenors to show independent Article III standing would not cause undue burdens on the court. . In fact, he argues that such a rule could produce practical benefits such as allowing courts to handle parallel standing claims.

The American Forest Resource Council (“American Forest”), in support of Laroe, counters that the judicial system will not be overburdened if parties are allowed to intervene without Article III standing under Rule 24. American Forest notes that intervening parties are still subject to limitations that will both limit the number of intervening parties and provide efficiency-conscious requirements for their conduct during the litigation. Additionally, Laroe maintains that the judicial system would be unduly burdened by a rule requiring every intervening party to prove it had Article III standing because the process for showing standing is so lengthy and complex. The burden on the court system would be magnified, Laroe contends, because rulings on standing are frequently appealed and remanded. Finally, Laroe argues that allowing parties to intervene under Rule 24 without proving independent standing would promote judicial efficiency by allowing courts to settle related matters simultaneously.

Edited by 

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