Eminent domain

Eminent domain (United States), compulsory purchase (United Kingdom, New Zealand, Republic of Ireland), resumption/compulsory acquisition (Australia) or expropriation (South Africa and Canada) in common law legal systems is the inherent power of the state to seize a citizen's private property, expropriate property, or rights in property, without the owner's consent. The property is taken either for government use or by delegation to third parties who will devote it to "public use" or in some cases, economic development. The most common uses of property taken by eminent domain are public utilities, highways, and railroads. Some states require that the government body offer to purchase the property before resorting to the use of eminent domain.

The term "expropriation" as used in the law of eminent domain is not to be confused with situations in which private property is seized by revolutionary governments from its former owners and confiscated without payment. It should also be differentiated from forfeiture which is an uncompensated seizure of contraband from criminals and its confiscation by the government.

The term "condemnation" is used to describe the formal act of the exercise of the power of eminent domain to transfer title to private property from its rightful owner to itself. It is not to be confused with the same term that describes a declaration that real property, generally a building, has become so dilapidated as to be legally unfit for human habitation due to its physical defects. This type of condemnation of buildings (on grounds of health and safety hazards or gross zoning violation) usually does not deprive the owners of the title to the property condemned but requires them to rectify the offending situation or have the government do it for them and bill them for the cost.

Condemnation via eminent domain indicates the government is taking the property or an interest in it, such as an easement. In most cases the only thing that remains to be decided when a condemnation action is filed is the amount of just compensation, although in some cases the right to take may be challenged by the property owner on the grounds that the attempted taking is not for a public use, or has not been authorized by the legislature, or because the condemnor has not followed the proper procedure required by law.

The exercise of eminent domain is not limited to real property. Governments may also condemn personal property, such as supplies for the military in wartime, franchises, as well as intangible property such as contracts, patents, trade secrets, and copyrights.

Etymology

The term "eminent domain" originated from the Latin term dominium eminens ("supreme lordship"), which was first used in the 17th century by Grotius to describe this concept.

History

The first case of eminent domain in English law is called the "Dobbie Process" or the "King's Prerogative in Saltpeter Case". The English king needed saltpeter for munitions and took a saltpeter mine from a private individual. The private party sued the king and the court established the right of the sovereign to take "private property for public use" without liability for trespass but requiring payment of compensation for the taken saltpeter. When the colonies became the United States and the English Common Law was adopted as the law of the new nation, this principle was recognized. Contrary to popular belief, the Fifth Amendment to the Constitution did not establish this right in the U.S., as it was already inherent in common law. The Fifth Amendment limited the right of eminent domain by requiring that takings be for "public use" and that "just compensation" be paid for the taken property. The term eminent domain is used primarily in the States, where the term was derived in the mid-19th century from the legal treatise, De Jure Belli et Pacis, written by the Dutch jurist Hugo Grotius in 1625, who used the term dominium eminens and described the power as follows:

"... the property of subjects is under the eminent domain of the state, so that the state or he who acts for it may use and even alienate and destroy such property, not only in the case of extreme necessity, in which even private persons have a right over the property of others, but for ends of public utility, to which ends those who founded civil society must be supposed to have intended that private ends should give way. But it is to be added that when this is done the state is bound to make good the loss to those who lose their property."

However, another noted jurist, Samuel von Pufendorf, in his work, De Jure Naturae et Gentium criticized the usage of the term "eminent domain". In his analysis of the control ("potestas") of property he made a classification as follows:

(a) Control, in the proprietary sense, as of that which is one's own, he termed "dominium";

(b) Control, in the governmental or sovereign sense, as of that which belongs to others, he termed "imperium". It was his conclusion that a more accurate term for the power to take property for public use would be "imperium eminens".

Many other jurists, like Cornelius Bynkershoek and Johann Gottlieb Heineccius also were of the same opinion as Puffendorf. However, Heineccius noted that though there is a difference and it is imperium that belongs to rulers, still it would be futile to condemn the term when it has been so widely accepted.

The legal principle is that all property in a jurisdiction is "owned" by the sovereign of it, and that authority to make law for that property is ultimate ownership. In a democratic nation the sovereign is the people, collectively, over all the territory of that nation. What private parties can "own" is not the land itself, but an equitable interest in title to an estate in the land or property, and it is that equitable interest to which they are entitled for compensation if the title to the estate is taken.

The term compulsory purchase, also originating in the mid-19th century, is used primarily in England and Wales (see compulsory purchase order, and other jurisdictions that follow the elements of English law. Originally, the power of eminent domain was assumed to arise from natural law as an inherent power of the sovereign. Some states (New York, Louisiana) use the term appropriation as a synonym for the exercising of eminent domain.

Allodial versus feudal title

Allodial title is the title to land generally held in freehold, by an individual or group that is sovereign on that land. Thus, in English law, only the monarch holds allodial title. All others are tenants of the sovereign through their feudal vassalages. Sovereigns generally gain allodial title either by grant of another sovereign to such title, or through right of conquest. In this respect, while colonial American land grants were typically feudal grants in fee-simple, the victory of the American cause in the American Revolutionary War is considered an act of conversion to allodial title, such that the king was no longer the sovereign of the colonies. However, the new holders in this case are the several states that engaged in the revolution, and it is upon this basis that the practice of fee-simple titles is continued in the United States. This is an issue of dispute by some constitutionalist and property rights groups, with some individuals occasionally attempting to patent allodial titles to their land. Some states, notably Nevada, have instituted an Allodial Title Program in which property owners can purchase allodial title to their land essentially by paying an amount discounted from the sum of all future property taxes for the term of the owner's life expectancy.

United States

In the United States, the right for the government to take private real or personal property predates the constitution and goes back to English Common Law. This right was implicitly recognized in the Fifth Amendment to the U.S. Constitution in 1791, which reads, “…nor shall private property be taken for public use, without just compensation.”

State governments almost immediately began using a broad definition of public use. As early as 1829, States gave eminent domain authority to freight and passenger railroad companies, thereby allowing a private entity to take land for private use (in the case of freight railroads).

The U.S. Supreme Court has consistently upheld the rights of states to make their own definitions of public use. For instance, in 1832 the Supreme Court ruled that eminent domain could be used to allow a mill owner to expand his dam and operations by flooding an upstream neighbor. The court opinion stated that a public use does not have to mean public occupation of the land; it can mean a public benefit.

In fact, until the 14th Amendment was ratified in 1868, there was some debate if the Federal government and Supreme Court had any role in ensuring that States paid just compensation.

Another early case, Clark vs. Nash (1905), allowed one farmer to build/expand an irrigation ditch, taking property owned by another farmer. This was considered a public use even though the water from the ditch was used entirely by the one farmer.

An expansive interpretation of eminent domain was reaffirmed in Berman v. Parker (1954), in which the U.S. Supreme Court reviewed an effort by the District of Columbia to take and raze structures that were primarily--but not entirely--blighted, in order to transfer the sites to private redevelopers who would construct condos, private office buildings and a shopping center. The Supreme Court ruled against the owners of non-blighted properties within the area on the grounds that the project should be judged on its plans as a whole, not on a parcel by parcel basis. In Hawaii Housing Authority v. Midkiff (1984), the Supreme Court approved eminent domain to break up a housing oligopoly.

The Supreme Court's decision in Kelo v. City of New London, 545 U.S. 469 (2005) affirmed New London’s authority to take nonblighted private property by eminent domain, and then sell the property to a private developer. This 5-4 decision received heavy press and in some cases inspired a public outcry. Several states have enacted or are considering state legislation that would restrict the state's own power of eminent domain. The Supreme Courts of Illinois, Michigan (County of Wayne v. Hathcock(2004)), and Ohio (Norwood, Ohio v. Horney(2006)) have recently ruled to disallow such takings under their state constitutions.

Bush Executive Order

On June 23, 2006 - on the one-year anniversary of the Kelo decision (see above), President George W. Bush issued an executive order stating in Section I that the Federal Government must limit its use of taking private property for "public use" with "just compensation", which is also stated in the constitution, for the "purpose of benefiting the general public." He limits this use by stating that it may not be used "for the purpose of advancing the economic interest of private parties to be given ownership or use of the property taken." However, eminent domain is often exercised by local and state governments; the order may thus have little overall effect.

Examples

• Controversy on the Delaware: A Look Upstream at the Tocks Island Dam Project
• United States v. Carmack
• United States v. Gettysburg Electric Railway Company 160 U.S. 668 (1896)
• Berman v. Parker, 348 U.S. 26 (1954)
• Hawaii Housing Authority v. Midkiff, 467 U.S. 229 (1984)
• Norwood, Ohio v. Horney
• Kelo v. City of New London

Typo in the U.S. Constitution

See also: Errors in the United States Constitution § Comma or smudge?

Europe

In many European nations, the European Convention on Human Rights provides protection from appropriation of private property by the state. Article 8 of the Convention provides that "Everyone has the right to respect for his private and family life, his home and his correspondence" and prohibits interference with this right by the state, unless the interference is in accordance with law and necessary in the interests of national security, public safety, economic well-being of the country, prevention of disorder or crime, protection of health or morals, or protection of the rights and freedoms of others. This right is expanded by Article 1 of the First Protocol to the Convention, which states that "Every natural person or legal person is entitled to the peaceful enjoyment of his possessions." Again, this is subject to exceptions where state deprivation of private possessions is in the public interest, is in accordance with law, and, in particular, to secure payment of taxes.

France

In France, the Declaration of the Rights of Man and of the Citizen similarly mandates just and preliminary compensation before expropriation.

England and Wales

In England and Wales, and other jurisdictions that follow the principles of English law, the related term compulsory purchase is used. The landowner is compensated with a price agreed or stipulated by an appropriate person. The operative law is a patchwork of statutes and case law. The principal Acts are the Lands Clauses Consolidation Act 1845, the Land Compensation Act 1961, the Compulsory Purchase Act 1965, the Land Compensation Act 1973, part IX of the Town and Country Planning Act 1990, the Planning and Compensation Act 1991, and the Planning and Compulsory Purchase Act 2004.

Australia

In Australia, section 51, subsection xxxi of the Constitution permits the federal government to make laws with respect to "the acquisition of property on just terms from any State or person for any purpose in respect of which the Parliament has power to make laws." This has been construed to not necessarily mean just compensation as a just term might not of necessity be monetary or proprietary recompense, as was particularly notable in The Castle. However, it is for the court to determine what is just and it may be necessary to imply a need for compensation in the interests of justice, lest the law be invalidated (Andrews v Howell (1941) 65 CLR 255). The property is not restricted to real estate. The precedent established by the federal court (Smith v Harrison (1981) 135 CLR 280) extended the states' power to any form of physical property. The court ruled that animals under the federal Marsupial Protection Act (MPA) could be expropriated from private owners and reestablished in reservations.

For the purposes of section 51, subsection xxxi, money is not property which may be compulsorily acquired; the Commonwealth must also derive some benefit from the property acquired and not merely seek to extinguish the previous owner's title (Mutual Pools and Staff Pty Ltd v Commissioner of Taxation (1992) 173 CLR 450). A statutory right to sue has been considered "property" under this section (Smith v ANL Ltd (2000) 176 ALR 449).

The term resumption is a reflection of the fact that all land was owned by the crown in 1788, and that the crown is resuming ownership.

Canada

In Canada expropriation is governed by federal or provincial statutes. Under these statutory regimes public authorities have the right to acquire private property for public purposes, so long as the acquisition is approved by the appropriate government body. Once property is taken, an owner is entitled to "be made whole" by compensation for: the market value of the expropriated property, injurious affection to the remainder of the property (if any), disturbance damages, business loss and special difficulty relocating. Owners can advance claims for compensation above that initially provided by the expropriating authority by bringing a claim before the court or an administrative body appointed by the governing legislation.

Other countries

Many countries recognize eminent domain to a much lesser extent than the English-speaking world or do not recognize it at all. Japan, for instance, has very weak eminent domain powers, as evidenced by the high-profile opposition to the expansion of Narita International Airport, and the disproportionate amounts of financial inducement given to residents on sites slated for redevelopment in return for their agreement to leave, one well-known recent case being that of Roppongi Hills.

There are other countries such as the People's Republic of China that practice eminent domain whenever it is convenient to make space for new communities and government structures. Singapore practices eminent domain under the Land Acquisitions Act which allows it to carry out its Selective En bloc Redevelopment Scheme for urban renewal. The Amendments to the Land Titles Act allowed property to be purchased for purposes of urban renewal against an owner sharing a collective title if the majority of the other owners wishes to sell and the minority did not. Thus, eminent domain often invokes concerns of majoritarianism.

Most recently (and infamously) in Zimbabwe, the government of Robert Mugabe seized a great deal of land and homes of mainly poor villagers thought to be political opponents of his regime.

Further reading

• Dana Berliner, Opening the Floodgates; Eminent Domain Abuse in a Post-Kelo World, Institute for Justice, June 2006. Available online [1].
• Redevelopment Wrecks; 20 Failed Projects Involving Eminent Domain Abuse, Institute for Justice, June 2006. Available online [2].
• Myths and Realities of Eminent Domain Abuse, Institute for Justice, June 2006. Available online [3].
• Steven Greenhut, Abuse Of Power: How The Government Misuses Eminent Domain, Seven Locks Press, June, 2004, trade paperback, 312 pages, ISBN 1-931643-37-7
• Joshua U. Galperin, A Warning To States, Accepting this Invitation May be Hazardous to Your Health (Safety and Public Welfare): An Analysis of Post-Kelo Legislative Activity. 31 Vermont Law Review 663 (2007).
• Aaron Pirnack, So Long, and Thanks for Playing: Small Business Fair Compensation and Eminent Domain

• Dana Berliner, Public Power, Private Gain, Institute for Justice, April 2003. Available online [4].
• A.J. Hazarabedian, California Eminent Domain Handbook, California Eminent Domain Law Group, June 2005. Available free online [5].
• John Ryskamp, The Eminent Domain Revolt: Changing Perceptions in a New Constitutional Epoch, New York: Algora Publishing, 2006.
• Just Compensation, A Monthly Report on Condemnation Cases, Gideon Kanner, Editor, Published monthly since 1957.
• Property Owners' Rights Handbook: Your Rights and Remedies Under the Eminent Domain Law, Sullivan, Workman & Dee, LLP, 2005. Available online [6].
• Bulldozed: 'Kelo,' Emiment Domain and the American Lust for Land, Carla T. Main, Encounter Books, August 2007.
• NCSL: Eminent Domain. Available online [7]
• NCSL: State Case Law Prohibiting Eminent Domain for Economic Development, August 2005. Available online [8]
• New Jersey Eminent Domain Law [9]