Eminent Domain

Eminent domain is the inherent sovereign power to take private property for public use. The Fifth Amendment's Takings Clause conditions this power on two requirements: the taking must be for "public use" and the government must pay "just compensation."

The definition of "public use" has been a major area of judicial development. In Kelo v. City of New London (2005), the Supreme Court broadly interpreted "public use" to include economic development, holding that the city could condemn private homes to make way for a private development project expected to create jobs and increase tax revenue. The Court gave substantial deference to the legislature's determination that the taking would serve a public purpose. Kelo was highly controversial and prompted many states to enact legislation restricting the use of eminent domain for economic development.

Just compensation is typically measured by the property's fair market value at the time of the taking — the price a willing buyer would pay a willing seller in an arm's-length transaction. The focus is on the loss to the owner, not the gain to the taker. Consequential damages (such as loss of business goodwill) are generally not compensable, though some states provide additional compensation by statute.

The government may acquire property through condemnation proceedings, in which the government files an action to take the property and a court determines just compensation. In some cases, the government may take immediate possession through "quick-take" procedures, with compensation determined later.

Eminent domain intersects with regulatory takings doctrine — when the government regulates property to the point that regulation effectively takes it, the owner may be entitled to compensation even without a formal condemnation proceeding. The Penn Central, Lucas, and Loretto frameworks address this intersection.

On exams, eminent domain questions typically focus on whether the "public use" requirement is satisfied and how "just compensation" should be calculated. Students should know Kelo's broad interpretation and the state-level backlash.