2/21/2005

High court to weigh eminent domain: Pittsburgh (PA) Post-Gazette, 2/21/05

By Michael McGough

When the U.S. Supreme Court returns to the bench tomorrow, it will hear arguments in a case that could lead to new rules on when government can seize private property from its owner and turn it over to another party in hopes of creating jobs and increasing tax revenue — a common "public use" far removed from the highways and bridges that were the traditional purpose of eminent domain.

In the audience will be a man for whom this is a landmark case in more ways than one. Bill Von Winkle owns three buildings in the Fort Trumbull area of New London, Conn., which the city and a development agency have sought to acquire by eminent domain for an elaborate redevelopment plan anchored by a Pfizer pharmaceutical company research center.

Von Winkle, who closed a delicatessen he operated in one of his buildings but continues to rent apartments on his property, is confident that he and eight other property owners will prevail in the Supreme Court.

"How could we possibly lose this?" Von Winkle said in an interview. "You can't do what they're doing. If Pfizer wants property, they've got to buy it, not steal it."

Actually, Von Winkle and the other property owners would receive payment for their property under Connecticut law and the Fifth Amendment to the U.S. Constitution, which says private property may not be "taken for public use without just compensation."

The question before the Supreme Court is whether the redevelopment of Fort Trumbull, which the city believes will invigorate the economy of New London, is a "public use" that overrides the owners' right to hold on to their land if they choose.

For Scott G. Bullock, the lawyer for the New London property owners, the answer is obvious: "This is a clear abuse of eminent domain. If they can take these properties, any neighborhood is up for grabs."

Bullock is an attorney for the Institute for Justice, a Washington-based libertarian public interest group well-known in Pittsburgh for its opposition to Mayor Tom Murphy's plans — later abandoned — to use eminent domain to assemble property for the redevelopment of the Fifth and Forbes retail area Downtown.

In interviews and in the institute's brief to the Supreme Court, Bullock argues that the New London case should be an easy one because — as is not the case with other uses of eminent domain — New London did not assert that the neighborhoods it seeks to condemn are "blighted." The redevelopment took place under a state law designed to revitalize older commercial and industrial areas.

"To petitioners, like most Americans, their homes are their castles," the institute's brief says. "In this case, they face the loss of the homes and neighbors they cherish through the use of eminent domain not for a traditional public use, such as a road or public building, nor even for the removal of blight. Rather, respondents — a local government and a private development corporation — seek to take petitioners' 15 homes to turn them over to other private parties in the hope that the city may benefit from whatever trickle-down effects those new businesses produce."

Supported by city governments — not including Pittsburgh's — and environmental organizations, New London argues in its brief that "employing the power of eminent domain to revitalize a municipality's economy satisfies the public use requirement. This is especially true in urban settings, in which the problem of land assembly often acts as a barrier to economic revitalization."

(The Bush administration has declined to take sides on the matter, which given the federal government's own past use of eminent domain is being interpreted as a victory for the property owners.)

Who's right? In 1954, the high court upheld the use of eminent domain by Congress for an urban renewal program in the District of Columbia.

Writing for the court, Justice William O. Douglas said, "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."

New London also cites a 1984 case in which the high court upheld Hawaii's use of eminent domain to condemn large tracts of leased residential property so it could break up an "oligopolistic pattern of landownership" left over from Hawaii's days as a monarchy.

New London and its allies insist that under these precedents Connecticut has the discretion to decide what a public purpose is without a federal judge second-guessing that decision.

Not surprisingly, the Institute for Justice reads the two Supreme Court precedents differently. Both, they said, limited the definition of "public use" to "the elimination of the undesirable conditions, not the land's subsequent use."

Although the Institute for Justice's preferred outcome would be for the court to rule that the trickle-down benefits of economic development never constitute a "public use," its brief offers the justices a fallback position: that even if such economic benefits can be a public use in some circumstances, the New London condemnations would not qualify because there is no "reasonable certainty" that the desired economic benefits will actually occur.

However the Supreme Court rules, experts on property law see this as a significant case, although one in which the court is unlikely to revoke the discretion it has given local governments to use eminent domain in "blighted" areas.

"Unless the Supreme Court uses this as a vehicle for revisiting [its 1954 ruling], the practical effect of a decision for the property owners would be small," said Paul Rosenzweig, senior legal research fellow at the Heritage Foundation's Center for Legal & Judicial Studies. "But I wouldn't underestimate the political effect of a decision in their favor. City councils will hesitate before ascribing blight to situations in which it didn't apply."

"This is an important case no matter how you look at it," agreed Laura S. Underkuffler, a property-law expert at Duke University.

"We've been operating, under a basic hands-off policy [regarding eminent doman] for a long time. Any incursion on that bedrock principle would be significant."

Underkuffler said she believed the court would rule narrowly in favor of the New London property owners.

"My guess is that the court will probably decline to craft some broad principle and will instead say that under the facts of this case this is not a public use," she said.

The willingness of the court to go further in reining in eminent domain may depend on how conservative justices resolve a tension between their support for property rights and their view that federal courts should not be "activist."

"This is a case where judges are being asked to trump legislative decisions," Underkuffler said, something conservative justices usually are reluctant to do.

Landmarks line eminent domain's path

It has been 50 years since the U.S. Supreme Court adopted an expansive view of the power of eminent domain in the case of Berman v. Parker, in which it upheld the condemnation of private property by the federal government as part of an urban renewal plan in the District of Columbia.

But the scope of eminent domain and the definition of the "public use" for which it may be employed have continued to generate controversy both in federal and state courts, whether the legal argument has focused on the Fifth Amendment to the U.S. Constitution or comparable provisions in state constitutions.

Some recent landmarks in the continuing legal debate:

  • 1981 — In Poletown Neighborhood Council v. City of Detroit, the Michigan Supreme Court upholds a plan under which private property is condemned to allow for the expansion of a General Motors plant. The majority opinion says that "eminent domain is to be used in this instance primarily to accomplish the essential public purposes of alleviating unemployment and revitalizing the economic base of the community. The benefit to a private interest is merely incidental."
  • 1984 — In the case of Hawaii Housing Authority v. Midkiff, the U.S. Supreme Court unanimously rules that the state did not violate the "public use" requirement by using eminent domain to transfer ownership from a small group of landowners to their tenants.
  • 2004 — In County of Wayne v. Hathcock, the Michigan Supreme Court overrules its holding in the Poletown case, calling the earlier decision "a radical departure from fundamental constitutional principles." In this case, dealing with a proposed acquisition of property near Detroit Metropolitan Airport, the court says that "Wayne County intends to transfer the condemned properties to private parties in a manner wholly inconsistent with the common understanding of 'public use' at the time our Constitution was ratified."
  • 2005 — This month, the Institute for Justice asked the Ohio Supreme Court to protect the vacant home of a couple in the city of Norwood who left the premises after lower courts ruled that the city did not exceed its authority in using eminent domain to acquire property for the expansion of a shopping mall.




Pittsburgh Post-Gazette: www.post-gazette.com