The case of "Lucas v. South Carolina Coastal Council" involved a man named David H. Lucas who was prevented from building on his residential lots due to the Beachfront Management Act enacted by the South Carolina Legislature. The Act rendered Lucas's parcels valueless, and the case required a decision on whether this constituted a taking of private property under the Fifth and Fourteenth Amendments, requiring just compensation. Justice Scalia delivered the majority opinion, stating that the Act constituted a taking and that Lucas was entitled to just compensation.

South Carolina had enacted its own Coastal Zone Management Act in 1977, requiring owners of coastal zone land to obtain a permit from the South Carolina Coastal Council before committing the land to a use other than what it was devoted to on September 28, 1977. The Beachfront Management Act prohibited the construction of any habitable structures seaward of a line drawn 20 feet landward of and parallel to the baseline, without any exceptions. Lucas claimed that the Act resulted in a taking of his property without just compensation.

The lower court agreed with Lucas and ordered the respondent to pay just compensation. However, the Supreme Court of South Carolina reversed the decision, stating that when a regulation is designed to prevent serious public harm, no compensation is owed under the Takings Clause, regardless of the regulation's effect on the property's value. Two justices dissented, stating that the Act's impact on the value of petitioner's lots constituted a taking. The case was granted certiorari.

The court ruled that Lucas's takings claim is valid and compensation is required if a regulation denies all economically beneficial use of land. The government cannot take away all economically beneficial use of land without compensation, unless the prohibited use was already unlawful. The Beachfront Management Act is presumed to be constitutional and allows the state to prevent harmful use of property. The court upheld the building ban as necessary to prevent harm to the community, but erred in reviewing the case before a final decision was made on what uses of the property would be permitted. The Supreme Court established a new standard that regulations eliminating all economic value are classified as a taking, except when they bar a background common-law nuisance or property principle. The Court permits a State to regulate all economic value only if the State prohibits uses that would not be permitted under background principles of nuisance and property law.

The Court's new rule prohibiting the legislature from taking away a property owner's only economically valuable use of their land lacks support from past precedents and restricts the legislature's power to adapt the law to changing circumstances. The Beachfront Management Act did not effect a taking of Lucas' property, and the Court's approach may hinder the efforts of local officials and planners dealing with complex land-use and environmental regulation problems. Justice Souter dissents and argues that the Court's holding rests on an unreviewable assumption, making it unclear and not useful to deal with the case on the merits. The Court cannot clarify the concept of total deprivation and assumes something about its scope, making it proper to vote to dismiss the writ.