; nor shall private property be taken for public use
without just compensation.”
The Best Class
“The Last Class”
The Process of Eminent Domain
Public Necessity and Just Compensation
Eminent Domain – Legal Theory
• Eminent Domain is an ancient power
• It is the pre-eminent power of government
• Assuming that all land and land rights devolve
from the King – the sovereign’s power extends to
the re-possession of any land upon showing of a
pubic necessity
• Under our 5th Amendment – “nor shall property
be taken by the government except for a public
purpose and upon payment of just
compensation”
Blackstone On Property and Takings
• So great moreover is the regard of the law for private
property, that it will not authorize the least violation of it;
no, not even for the general good of the whole
community. If a new road, for instance, were to be
made through the grounds of a private person, it might
perhaps be extensively beneficial to the public; but the
law permits no man, or set of men, to do this without
consent of the owner of the land. In vain may it be
urged, that the good of the individual ought to yield to
that of the community; for it would be dangerous to
allow any private man, or even any public tribunal, to
be the judge of this common good, and to decide
whether it be expedient or no.
Blackstone II
• Besides, the public good is in nothing more essentially
interested, than in the protection of every individual's
private rights, as modeled by the municipal law
• In this, and similar cases the legislature alone can, and
indeed frequently does, interpose, and compel the
individual to acquiesce
• But how does it interpose and compel? Not by
absolutely stripping the subject of his property in an
arbitrary manner; but by giving him a full indemnification
and equivalent for the injury thereby sustained. The
public is now considered as an individual, treating with
an individual for an exchange.
Blackstone
• All that the legislature does is to oblige the
owner to alienate his possessions for a
reasonable price; and even this is an exertion of
power, which the legislature indulges with
caution, and which nothing but the legislature
can perform.
What Is Condemnation?
• The government may “take” in three ways:
– Eminent Domain
– Regulatory or Categorical Taking of All or Practically
All Value Related to Use
– Inverse Condemnation – When the government, by its
actions, makes the use of private property untenable
•
•
•
•
Airport Cases
Military Bases
Damage resulting from flooding or dam projects
A project which undermines nearby structural foundations
What is Just Compensation
• Just compensation is based on value
• Value can have many faces but “fair market
value” is the standard used in Eminent Domain
• This is classically define as “what a willing seller
with take and a willing buyer offer”
• Justice Butler defined just compensation as:
– “The owner is entitled to the full money equivalent of
the property taken, and thereby to be put in as good
a position pecuniarily as he would have occupied, if
the property had not been taken”
Value – The Principles
• Courts talk in terms of present market value and
not future or speculative value unless the
probability of such future value affects present
value
• If the special adaptability of the land for the
projected use creates a special demand by
ordinary purchasers, this may be included in
present value
• The market value is not all of the just
compensation picture.
• It is only a payment for strict money value on a
well define parcel
Damages And Value
• Consequential Damages
– Term used to describe the personal injuries such as the
expense of moving, inconvenience, interruption of
business, loss of good will and under rare
circumstances, pain and suffering
– The major principle is that the owner should only be
compensated for those things of value that cannot
be taken with him
• Severance Damage
– The damage resulting from diminution in market value
of the owner’s remainder – the relationship of the part
to the whole
Public Purpose
• Public purpose is shown when the holder of a
certificate of necessity demonstrates a
compelling need (under their corporate
purpose) to acquire real property to increase
the benefit to the public in general
• Thus, there is a general benefit in:
–
–
–
–
Building roads
Supplying electrical power
Removing and redeveloping blighted areas
Creating flood control
Case Examples
Public Roads
Parking Lots
Sidewalks
Riley v District of Columbia Redevelopment
Corporation, 1956
• The District of Columbia instituted eminent
domain against 45 parcels of land for the
purpose of clearance for a public building
• Mrs. Riley was given 3 appraisals:
– $6,500
– $7,000
– $6,200
• The jury returned an award of $7,000
This is A Case About Mrs. Riley
She is not the
sharpest tack
on the bulletin
board
Background
•Mrs. Riley bought the
house in 1951 for a total of
$9,950
–She added $877 worth of
improvements
•When it was seized in 1954
she owned a total of $8,902
for the mortgage
•Thus the award was $3,800
less than the purchase price
and about $1,900 less than
her total investment
•Mrs. Riley was ticked off
and appealed the award
Appeals Court
• The Court begins by saying that just compensation
means the full and perfect equivalent in money of the
property taken
• The Court then examines two key questions:
– The nature of the property in 1951
– The nature of the purchase in 1951
• The Court found the house to be solidly built and in good
condition for its 50 years of age
• Mrs. Riley purchased the home for her daughter and her
elderly Mother – it was conveniently located within
walking distance of the Civil Service where Mrs. Riley
worked
• It was all she could afford
Can You See What’s Coming?
Real Estate and Appraisers
• A real estate agent testified for Mrs. Riley. He
had sold a large amount of homes in the area
for $10,000
• A neighbor purchased a home adjacent to Mrs.
Riley in 1952 for $10,800
• The appraisers said the house was
approximately 40 percent depreciated and
could be built today for $9,355. It had no
income producing properties
• The appraisers felt that the purchase price bore
no relation to the fair value. She paid too much
for it – almost stupidly excessive
And The Court
It is the ordinary rule that the burden of proof in a
commendation case rests with the owner
But this is not ordinary
Mrs. Riley seeks nothing – the government here is
taking her private property – her home
To take it is the highest form of power and requires
the highest form of justice – unequivocal just
compensation
God Strikes Down For Mrs. O’Reily
The Lone Ranger Rides Again
Inverse Condemnation and The Rule of
Remnants
Martin v Port of Seattle, 1964
• In this case 196 property owners seek damages
arising from inverse condemnation against the
Seattle-Tacoma Airport
• The damage is from low altitude flights of
jetliners over their property
• The essential legal question is whether the
property owners actually have a claim for
damage from the noise of aircraft
Background
• The property in question forms a rectangular
area about one mile long and ½ mile wide
directly south of the primary runway
• Jetliners in the process of landing pass over this
area at approximately 500 feet in altitude
• Basic problems
–
–
–
–
Vibration is sufficient to throw dishes from shelves
Conversation is interrupted from noise
Sleep is disrupted, and the noise painful to many
Many cannot sell their homes
Primary
Runway
The Airport Responds
• Congress has placed all navigable airspace
within the public domain
• The damage is incidental and does not
constitute a physical invasion
• At most, it damages but does not take the
property
• If a property owner can prove a diminution of
value we should pay for that increment only –
not be required to take the entire property
The Trial Court
• The trail court found that the interference
amounted to a physical invasion of the air
easement and constituted an inverse
commendation
• When the noise and vibration deprives the land
owner of an essential element of their land the
result should be the same as if the airport
operator brings the condemnation of the
property
Appeals Court
• This is no different that it would be if the land in
question would have been condemned by the
State when the airport land was acquired
• If the damage is slight – then an owner should
be entitled to payment for the increment of
diminishment of enjoyment – even a slight
burden must be paid
• If the damage is substantial, then the owner
should be entitled to full and perfect recovery of
property under formal condemnation
Remnants
City of Crookstown v Erickson Minn. 1955
• The City condemned land for a sewerage
treatment plant, discharge system, and
administration building from a Mr. Erickson
• They did not take all the land Erickson owned
and left a remnant of 1.3 acre plus the house
• Erickson appealed the judgment and claimed
that the contemplated use would damage his
remainder
The Erickson Tract Taking
Sewer Plant Office
Erickson House
Area of Taking Formerly
Erickson Tract
Waste Water Treatment Plant
Erickson Tract
Remainder
Appeals Court
• The Court sets out important rules in this case
– When no part of an owner’s land is taken, and the
use of adjoining land causes damage, the damage is
not compensable unless it is peculiar to the adjoining
land and not the type suffered by the public in
general
– Where there is a partial taking, the injured owner is
required to show damage peculiar to the remaining
property and this becomes part of the compensation
– When the use of the land taken constitutes and
integral and inseparable part of the single use, the
government will be required to take the entire whole
Why Not Future Value?
• In Board of Education v Baczewski (1992) a
Michigan School District condemned 110 acres
of land for a future school
• The Board admits that it may continue to use the
present High School for another 30 years
• It admits that it took the land to save money
because of increased prices in the future
• Should the Board have paid on future value
rather than current fair market value?
Court Rule
• School Board officials would not have been
performing their duties had they waited for the
present school to deteriorate before they
purchased land
• Fair market value is all that is required
Eminent Domain: An Analysis
of Kelo v. New London
“For violent fires soon burn out themselves.”
Source: W Shakespeare; The Tragedy of King Richard the Second (Gaunt at II, i)
Outline
•
•
•
•
Background
Analysis
Implications
Conclusion
Eminent Domain
• Defined by Webster's as the right of the government to take property
from a private owner for public use by virtue of the superior
dominion of its sovereignty over all lands within its jurisdiction
Background
• New London is in a long economic recession
• Kelo purchased a house in the Fort Trumbull
neighborhood
• Pfizer builds a multimillion dollar research facility
adjacent to the neighborhood
• New London Development Corporation, a private, nonprofit organization, is reactivated
• The City of New London calls for complete
redevelopment of the entire deactivated Fort Trumbell
Area – housing; parks; businesses
The Actions
• After the development plan was approved by
the city, the NLDC began negotiations with the
landowners of the area for the purchase of their
property
• The development area consists of 115 parcels in
addition to the 32 acres of land formerly
occupied by the U.S. Naval base.
Background
• NLDC plans a mixed use development with a
high end hotel, condos, and retail development
• Area contains approximately
• Of the115 privately owned parcels, 15 parcels
are owned by the seven petitioners who are
unwilling to sell
• City of New London initiates condemnation at
the request of the NLDC
Suzette Kelo et al Take Exception
"There is no amount of money that could
replace our homes and our memories.
This is where we chose to settle, and this
is where we want to stay. This is
America, the home of the free, isn't it?”
Brief of the Petitioners
• Want a bright line rule prohibiting eminent
domain for economic development
• Condemnation was unconstitutional
• Economic development is not a valid public use
under the Fifth Amendment
• Affirming the condemnations will promote more
cities to condemn property
Brief of the Petitioners
• Argues that the use of eminent domain amounts
subsidizing private projects
• Relies on their interpretation of Berman and
Midkiff in their arguments
• Want a “reasonable certainty” of success for
any property condemned
Brief of the Respondents
• Court should adhere to its deference to
legislatures and hold that economic
development constitutes a public use
• Exercise of eminent domain authority by the
respondents in this case satisfies the public use
requirement
• Courts opinion in Berman and Midkiff validate
the condemnation
Brief of the Respondents
• Economic development constitutes a public use
because it is rationally related to a conceivable
public purpose
• Respondents feel that there is no need for
greater oversight on the part of the judiciary
Opinion of the Court
• Court ruled for the respondent by a 5-4 margin
• The court upheld the ruling that the proposed
development was a public use within the takings
clause.
– NLDC had a carefully formulated development plan
– Area was judged to be sufficiently distressed to justify
economic rejuvenation
– Economic development is a governmental function
that cannot be separated from other functions
Opinion of the Court
• Supreme Court ruled that economic
development constitutes a public use
• Consequently, eminent domain can be used to
assemble parcels and eliminate holdouts
• Court reminded the parties that individual states
can enact legislation either prohibiting or
allowing eminent domain for economic
development
Implications
• The use of eminent domain as a major tool for
public/private alliances in local economic
development
• State and Federal legislation prohibiting eminent
domain for economic development
• Pending legislation that will limit or prohibit the
powers of condemnation.
Comment/Observations
• Berman v Parker, 1954
– n 1945, the United States Congress passed the District
of Columbia Redevelopment Act of 1945 to address
the vast blighted area found in the District of
Columbia
– The Act created a commission of five members called
the District of Columbia Redevelopment Land
Agency and granted it the power to redevelop
blighted areas and eliminate any "blighting factors or
causes of blight." The act granted the Agency the
power of eminent domain if necessary
Findings
– After five years of planning, the Planning Commission
published its results and determined that in one
blighted area, [Area B] "64.3% of the dwellings were
beyond repair, 18.4% needed major repairs, only
17.3% were satisfactory; 57.8% of the dwellings had
outside toilets, 60.3% had no baths, 29.6% lacked
electricity, 82.2% had no wash basins or laundry tubs,
83.8% lacked central heating
– “The population of Area B amounted to 5,012
persons, of whom 97.5% were Negroes”
The Supreme Court Weighs In
• Justice Douglas
– We do not sit to determine whether a particular housing project
is or is not desirable. The concept of the public welfare is broad
and inclusive. The values it represents are spiritual as well as
physical, aesthetic as well as monetary. It is within the power of
the legislature to determine that the community should be
beautiful as well as healthy, spacious as well as clean, wellbalanced as well as carefully patrolled. In the present case, the
Congress and its authorized agencies have made
determinations that take into account a wide variety of values. It
is not for us to reappraise them. If those who govern the District
of Columbia decide that the Nation's Capital should be
beautiful as well as sanitary, there is nothing in the Fifth
Amendment that stands in the way.
And
• On public use
– Here one of the means chosen is the use of private enterprise for
redevelopment of the area. Appellants argue that this makes
the project a taking from one businessman for the benefit of
another businessman. But the means of executing the project
are for Congress and Congress alone to determine, once the
public purpose has been established.
– The public end may be as well or better served through an
agency of private enterprise than through a department of
government - or so the Congress might conclude. We cannot
say that public ownership is the sole method of promoting the
public purposes of community redevelopment projects. What
we have said also disposes of any contention concerning the
fact that certain property owners in the area may be permitted
to repurchase their properties for redevelopment in harmony
with the over-all plan. That, too, is a legitimate means which
Congress and its agencies may adopt, if they choose
Actions
– The Commission's plans made "detailed provisions for the types
of dwelling units and provides that at least one-third of them are
to be low-rent housing with a maximum rental of $17 per room
per month." The Commission then held a public hearing, after
which the plan was approved
– After approval of the plan, owners of a department store in the
area designated to be redeveloped brought suit to the court.
The landowners claimed that because the department store
itself was not blighted, its redevelopment was not necessary and
would not constitute a public use. The owners further argued
that taking the land under eminent domain and giving it to
redevelopers amounted to "a taking from one businessman for
the benefit of another businessman
Berman’s – 704 S.W. 4th Washington DC
Conclusion
• TAKE HOME POINTS
• Coverage by popular media is incomplete
• Given the precedent set in Berman and Midkiff,
the decision was predictable
• Eminent domain for economic development is
constitutionally valid
• State Legislatures are free to do as they wish
Questions? Comments?