---
title: Eminent Domain and Just Compensation
description: An overview of the legal principles and requirements governing the government's power of eminent domain and the property owner's right to just compensation.
keywords: [eminent domain, just compensation, takings clause, public use, fair market value]
category: law
---

## Introduction to Eminent Domain

Eminent domain is the inherent power of the government to take private property for public use, subject to the payment of just compensation to the property owner.[^1] This power is derived from the Takings Clause of the Fifth Amendment to the U.S. Constitution, which states that "private property [shall not] be taken for public use, without just compensation."[^2] The Supreme Court has long recognized eminent domain as a necessary and valid exercise of the government's police power, provided that the taking is for a public purpose and the owner is fairly compensated.[^3]

The government's power of eminent domain extends to the federal, state, and local levels, and can be used to acquire land, buildings, personal property, and even intangible property rights, such as easements or leaseholds.[^4] However, the government's exercise of this power is subject to certain constitutional and statutory limitations to protect the rights of private property owners.[^5]

## The Public Use Requirement

For a taking to be lawful under the Fifth Amendment, the property must be acquired for a "public use."[^6] The Supreme Court has interpreted this requirement broadly, holding that a taking satisfies the public use test as long as it is "rationally related to a conceivable public purpose."[^7] This includes not only traditional public uses, such as roads, parks, and government buildings, but also economic development projects, urban renewal, and the elimination of "blight."[^8]

The burden is on the government to demonstrate that the taking is for a valid public use.[^9] However, the courts generally afford significant deference to the government's determination of public purpose, and will only invalidate a taking if it is "without any reasonable basis."[^10] Consequently, challenges to the public use requirement are rarely successful.

## The Just Compensation Requirement

The Fifth Amendment also requires the government to pay "just compensation" to the property owner whose property is taken through eminent domain.[^11] The Supreme Court has defined "just compensation" as the fair market value of the property at the time of the taking, plus any additional damages to the remaining property not taken.[^12] This is typically determined by appraisals and expert testimony.

The burden is on the property owner to establish the fair market value of the property, which is defined as the price that a willing buyer would pay a willing seller, neither being under any compulsion to buy or sell.[^13] Relevant factors in determining fair market value include the property's highest and best use, recent sales of comparable properties, and any unique characteristics or improvements to the land.[^14]

In addition to the fair market value of the taken property, the government may also be required to compensate the owner for consequential damages, such as the loss of business goodwill or the cost of relocating a business.[^15] However, the government is not required to compensate the owner for speculative or conjectural losses.[^16]

## The Eminent Domain Process

The process of exercising eminent domain typically begins with the government agency identifying the property needed for a public project and initiating condemnation proceedings.[^17] The agency must provide the property owner with notice and an opportunity to be heard, as well as an initial offer of compensation based on the property's appraised value.[^18]

If the property owner disputes the government's offer, the matter may proceed to a judicial determination of just compensation.[^19] In this process, the property owner has the burden of proving that the government's offer is inadequate, and the court will consider evidence from both parties to determine the appropriate amount of compensation.[^20] The property owner may also be entitled to recover attorneys' fees and other litigation expenses if the court awards an amount that exceeds the government's initial offer by a certain percentage.[^21]

## Limitations on Eminent Domain

While the government's power of eminent domain is broad, it is not unlimited. The Fifth Amendment's public use and just compensation requirements, as well as various federal and state laws, impose important constraints on the government's exercise of this power.[^22]

For example, the Supreme Court has held that the government cannot take property for the purpose of transferring it to a private party for economic development, unless the taking is necessary to remedy "blight" or some other harm to the public.[^23] Additionally, some states have enacted laws that further limit the government's power of eminent domain, such as by requiring a higher standard of public use or providing additional protections for property owners.[^24]

Moreover, property owners may have other legal remedies available, such as challenging the government's determination of public use, disputing the amount of just compensation, or seeking injunctive relief to prevent the taking.[^25] Ultimately, the balance between the government's power of eminent domain and the rights of private property owners continues to be an area of ongoing legal and political debate.

[^1]: Kelo v. City of New London, 545 U.S. 469, 477 (2005).
[^2]: U.S. Const. amend. V.
[^3]: Berman v. Parker, 348 U.S. 26, 33 (1954).
[^4]: 26 Am. Jur. 2d Eminent Domain § 21 (2022).
[^5]: Dolan v. City of Tigard, 512 U.S. 374, 384 (1994).
[^6]: U.S. Const. amend. V.
[^7]: Kelo, 545 U.S. at 490 (Kennedy, J., concurring).
[^8]: Berman, 348 U.S. at 33-34.
[^9]: Hawaii Hous. Auth. v. Midkiff, 467 U.S. 229, 244 (1984).
[^10]: Kelo, 545 U.S. at 490 (Kennedy, J., concurring).
[^11]: U.S. Const. amend. V.
[^12]: United States v. Miller, 317 U.S. 369, 373-74 (1943).
[^13]: United States v. Cors, 337 U.S. 325, 333 (1949).
[^14]: 27 Am. Jur. 2d Eminent Domain § 672 (2022).
[^15]: Kimball Laundry Co. v. United States, 338 U.S. 1, 7 (1949).
[^16]: United States v. Petty Motor Co., 327 U.S. 372, 377-78 (1946).
[^17]: 26 Am. Jur. 2d Eminent Domain § 201 (2022).
[^18]: 26 Am. Jur. 2d Eminent Domain § 202 (2022).
[^19]: 26 Am. Jur. 2d Eminent Domain § 203 (2022).
[^20]: 26 Am. Jur. 2d Eminent Domain § 204 (2022).
[^21]: 26 Am. Jur. 2d Eminent Domain § 205 (2022).
[^22]: Dolan, 512 U.S. at 384.
[^23]: Kelo, 545 U.S. at 477-78.
[^24]: See, e.g., Tex. Gov't Code Ann. § 2206.001 (West 2022).
[^25]: 26 Am. Jur. 2d Eminent Domain § 48 (2022).