Eminent domain is the government’s right to take private property for public use, even against the wishes of the owner, in exchange for the payment of just compensation. The process for eminent domain begins with the government entity interested in acquiring the property making contact with the property owner. This is done to express the government’s interest and to schedule a date for an appraisal of the property.
The federal government, state governments, county governments and municipalities have the right to take private property for public use through the use of eminent domain.
The Fifth Amendment to the U.S. Constitution grants the right of eminent domain, stating, as it does, that private property cannot be taken for public use without just compensation. Most other common law nations give their governments this power, although in many of them it is referred to as “expropriation”, “compulsory acquisition” or “compulsory purchase.”
Government authorities can take private property in exchange for just compensation through condemnation proceedings, in which owners can challenge the legal validity of the reason for the taking and settle the matter of fair market value used to set the amount of compensation.
The most straightforward examples of condemnation involve land and buildings purchased by a public entity to make way for a public project, such as construction of a public road. But eminent domain can be used to purchase airspace, water, dirt, timber, and rock appropriated from private land for the construction of roads.
The final step in eminent domain is for the government to make a formal offer to purchase the property from the owner. A property owner who does not want to sell their property to the government may be able to challenge the acquisition in some situations, but not always.
The following are considered property that may be acquired by a government authority through eminent domain depending on the law of the state and locality in which the property is located:
- Other forms of property such as airspace, land, contract rights and intellectual property can be subject to eminent domain if a case can be made that it will be put to public use;
- Both an entire property and a partial property can be seized, and there is the possibility of a temporary seizure.
How Do I Know That the Government Wants My Property?
The government is required to send a formal notice to the owner of property that it wants to purchase it through the use of eminent domain. The notice informs the property owner of the government’s intent to exercise its right of eminent domain on the owner’s property.
Can I Challenge a Government’s Exercise of Eminent Domain?
Different government entities in different states have different procedures for the eminent domain process. The process may involve an administrative hearing. However, regardless of which government entity is attempting to acquire the property, the administrative hearing is an opportunity for the owner to contest the taking and the compensation offered for the property.
As mentioned above, there are some clear guidelines for eminent domain. They are that the property is taken to serve a public purpose, that just compensation is offered in exchange, and that the property is acquired by a governmental entity.
Generally speaking, it is usually not possible for an owner to refuse eminent domain in the end. The most that the vast majority of property owners can hope to achieve is to drive the market valuation higher.
Eminent domain has been utilized on occasion to provide land for private use on the grounds that this would benefit the public in quite an indirect manner. For example, in the 1980s private land was taken for General Motors, the motor vehicle manufacturer, so that a factory could be built on the premises. Supposedly, this was a public use because it would create jobs for the citizens of the locale in which the factory was built and boost tax revenues.
Another well-known case in which homeowners challenged an exercise of eminent domain by a city in Connecticut was fought in the courts in the early 2000s. A city sought to condemn homes and small businesses in order to make space for private development by the Pfizer pharmaceutical corporation. Homeowners and business owners were surprised to learn that the city could take their property to promote private development.
The U.S. Supreme Court ruled in favor of the city and against the homeowners and business owners. In response to this ruling, some states have passed new laws that protect property owners from eminent domain takings that many consider abusive, because they are done to benefit a private person or company and their connection to a public use that serves the public good is questionable.
How Can I Challenge a Government Taking?
There are two ways to challenge a government taking. A property owner can either:
- Challenge the government on the issue of whether the property is necessary for the intended purpose; or
- Challenge the government on the issue of whether the intended use of the property actually serves a public purpose.
Inverse condemnation is an option in some circumstances. A property owner can file an inverse condemnation lawsuit when they believe that there has been a taking of their property or damage to it without just compensation or formal eminent domain proceedings.
What Constitutes Public Use?
What constitutes a public use depends on the law in the state and locality in which a person’s property is located. Generally, public use means that the property would be accessible to the general public, such as a highway or community recreation facility.
However, under eminent domain, “public use” has been interpreted as including certain private uses on the assumption that it benefits the public, such as seizing property and turning it into a “business park” or development zone of some type that would lead to job growth in the local economy. The justification is that private development provides a community with jobs and tax revenue.
In response to the Pfizer case, many states passed laws regarding the use of eminent domain for the purpose of giving land to private entities for private development. For example, Minnesota adopted a new law that limits the use of eminent domain to a public use or public purpose.
The law in Minnesota defines “public use” or “public purpose” as the possession, occupation, ownership, or enjoyment of the property by the general public or a public agency, or for the mitigation of blight. It states that the public benefits of private development do not qualify as a public use or a public purpose. The law also requires that public agencies negotiate with property owners in good-faith and provide additional public notice and improved public hearings on the issues involved in a case of eminent domain.
A new law in Pennsylvania prohibits eminent domain for serving the purposes of private business. Public use in Pennsylvania can include so-called “redevelopment projects” in areas where properties have been abandoned and have become uninhabitable, or have been condemned, or allowed to become public nuisances due to their dangerous conditions.
Each state has its own laws with its own definitions. A person must consult the law in the state and locality in which the property is located, because eminent domain is a type of local action, which means proceedings must take place where the property is located.
Can I Lose the Administrative Hearing?
As with any legal proceeding in which parties contend for legal victory, the outcome is never certain. The officials overseeing the hearing may well side with the government regarding the eminent domain and the compensation amount. However, a less than favorable outcome from the administrative hearing does not have to be the end of a person’s challenge to an exercise of eminent domain. The losing party has the right to appeal.
Can I Continue to Challenge the Eminent Domain Taking If I Lose?
The losing party has the right to appeal a decision in an eminent domain case either to an appeals board or to a higher court, again depending on state and local rules. If the property owner wins the appeal, they will be able to prevent the government from taking their property.
If the appeal fails, the property owner can appeal all the way up to the U.S. Supreme Court. Of course, they would want to consider the expense of doing so as well as the likelihood of ultimate victory.
Do I Need the Help of an Attorney to Challenge a Taking Through Eminent Domain?
Challenging a government entity in an eminent domain proceeding can be difficult and complicated. If you are fighting to save your property from eminent domain, you want to consult a real estate attorney.
An attorney can explain your rights and how the process works. They can help you fight off the government’s attempt to take your property or drive the value of the compensation you will receive to an acceptable amount.
