U.S. Supreme Court Case:  Condemnation for Private Development

Kelo et al. v. City of New London Case 04-108 (2005)

This case involves a city condemning private property and transferring ownership to other private owners, one being the pharmaceuticals giant Pfizer. The Fifth Amendment provides that private property may be taken through eminent domain only for "public use."  The City of New London contends the taking complies with the public use requirement because it is part of an economic development plan that will create jobs and benefit the public.  The Court agreed with the city even though the land taken in this case will not be used by the public but will be used by its new private owner.  Justice Clarence Thomas' dissent states:  "I cannot agree. If such ‘economic development’ takings are for a ‘public use,’ any taking is. ... I would revisit our Public Use Clause cases and consider returning to the original meaning of the Public Use Clause:  that the government may take property only if it actually uses or gives the public a legal right to use the property."

Texas Supreme Court Cases

Compensation for Delay of Condemnation

Westgate, Ltd. v. State of Texas and City of Austin Case D-0732 (1992)

Property owners may not recover damages caused by the announcement intention and subsequent years of delay to acquire property by condemnation.

Compensation for Diminished Access

State of Texas and City of Austin v. Robert M. Schmidt and Richard A. Massman, Co-trustees of the Leon A. Schmidt Children’s Trust No. 1, et al. Case D-1006 (1993)

The Court ruled that damages to a remainder tract might not include changes in visibility of property and other results of roadway alterations.

Bona Fide Offer and Good Faith Negotiations

Thelma Blahuta Hubenak and Emil Blahuta v. San Jacinto Gas Transmission Company (2004)

Before this decision, condemnors were required to make landowners a bona fide offer based on the estimated fair market value of the land in good faith negotiations.  However, the Court decided that fair market value is not necessary for a bona fide offer--the condemnor needs only to make a monetary offer.  Therefore the first phase of condemnation--negotiations--has basically been eliminated.

In this case, the condemnor--a pipeline company--also sought to purchase three additional property rights that they could not condemn.  The landowners felt that this attempt did not qualify as a good faith negotiation but the Court found this to be “simply irrelevant.”

Bandera County Courier Farm and Ranch News:  TLC Articles

“The Texas Supreme Court’s condemnation of Texas”

By Lauren Stucky, August 23, 2007

“Eminent domain, groundwater law at forefront of TLC conference”

By Lauren Stucky Flake, February 14, 2008

Resources

Texas A&M University Real Estate Center:  Condemnation Publications

Texas Public Policy Foundation:  Eminent Domain

Dawson, Sodd, Ellis & Hodge, L.L.P.:  Eminent Domain FAQs

Barron & Adler, L.L.P.:  Eminent Domain Publications