Hawai'i lawmakers, frustrated by often having the highest gasoline prices in the nation, adopted the law in 1997, saying it would help bring down gasoline prices.

The 9th U.S. Circuit Court of Appeals ruled the law unconstitutional because it would take away property — in this case, rent — from private owners without a compelling public benefit. The court questioned whether this law would actually lead to lower prices.

Lingle, who opposes the rent-cap law, is sending state Attorney General Mark Bennett to Washington to argue in favor of the state's right to enact it.

"This is not about whether this rent-cap law is a good or bad idea," said Bennett. "This case has implications for almost any kind of economic law that a state or municipality could pass that could affect property interests."

The U.S. Constitution allows a state government to take someone's property if there is a compelling public interest in doing so.

Instead of arguing that the law makes sense for consumers, Bennett will argue that the courts should give states more deference on economic and social policy matters. Hawai'i will be joined by 27 states, Puerto Rico, Guam and several cities and other groups in pushing to reverse the lower-court decision in Linda Lingle vs. Chevron USA Inc.

"The question is who has the power to make economic laws and what kinds of discretion does the constitution allow to legislatures," Bennett said. "In our representative democracy, economic development decisions are the Legislature's to make."

Lawmakers created the rent cap after claims of "economic eviction" were raised by some gas station dealers, who contended that oil companies raised rents, forcing them from their locations. Lawmakers hoped that lower gasoline prices would result if stations were provided rent relief.

More than a year ago, former Shell dealer Warren Higa closed Makiki Shell, claiming that Shell Oil Co. tripled the station's monthly rent to $19,000 over a three-year period. Higa has said he might still be in business at that location if the rent cap had been in place.

Also on Tuesday, the Supreme Court will hear arguments on a related issue. In Kelo vs. New London, a group of homeowners in the New London, Conn., are appealing a lower-court ruling that allows the city to take the homeowners' land for redevelopment by Pfizer Inc.

In the Kelo case, the question is whether government can take private property for someone else's private use, if it is for a greater public interest such as job creation and economic development, said Robert Thomas, managing attorney for the Pacific Legal Foundation's Hawaii Center.

The Hawaii Center has filed briefs asking the court to rule in favor of the homeowners and Chevron.

Chevron will argue that the rent-cap law doesn't substantially advance a public interest — a position backed by the prior appellate court, Thomas said. Chevron, now ChevronTexaco, said it would not comment on pending litigation.

"Chevron is seeking only to strike down the rent cap .... because it doesn't advance a substantial public interest," Thomas said.

A Supreme Court decision in each case is expected around the end of June.