Private property rights was a tenet of our founding fathers.  An individual's right to keep what was his was a basic principal that our founding fathers considered sacred and inviolable. 

"That alone is a just government which impartially secures to every man whatever is his own."
~James Madison (circa 1792)

James Madison was the author of the 5th Amendment and I think it is clear what he meant by "nor shall private property be taken for public use, without just compensation." In the era of the late 18th century there was very little discussion about property rights - most likely because everyone of the time had the same perceptions. 

However, in 2005, when the Supreme Court decided Kelo v. City of New London, the Court effectively allowed the State to take private property and give it to someone else.  Justice O'Connor, in a strong dissenting opinion, said that they effectively deleted the words "for public use" from the Takings Clause of the 5th Amendment.

How have we moved so far from our framers intent to protect individual property rights?

If you aren't familiar with Kelo, some background is in order.  The City of New London, Connecticut was home to the Naval Undersea Warfare Center and the federal government closed the base in 1996.  By 1998, the unemployment rate in New London was double the average of the State and the population was at its lowest level since 1920 - just under 24,000. 

Then, Pfizer announced that it was planning to build a $300 million facility nearby and, in order to capitalize on the development, New London decided to develop a comprehensive economic redevelopment plan.  By redeveloping the old Navy base and surrounding property, they hoped to rejuvenate the city - creating jobs and attracting new residents.  The plan called for taking 115 privately owned properties... by eminent domain if necessary.

There was nothing wrong with these private properties - they weren't blighted or causing any other harm.  But, the city decided that they could put the property to a better use.

A few of the homeowners challenged the constitutionality of the takings as violating the 5th Amendment.  The Court, in a very divisive 5-4 decision, upheld the takings finding that it served a "public purpose."  However, the Takings Clause uses the words "public use" - not "public purpose."  The old "use by the public" test, they said, was too difficult to administer and impractical given the diverse and always evolving needs of society.  The basic holding of the Court was that it was up to the States to determine what was "public use" and once the legislature had spoken, it was not for the courts to second guess them.

The Supreme Court hasn't always been so deferential.

"An Act of the Legislature (for I cannot call it a law) contrary to the great first principals of the social compact, cannot be considered a rightful exercise of legislative authority... a few instances will suffice to explain what I mean... A law that takes property from A, and gives it to B: It is against all reason and justice, for a people to entrust a Legislature with such powers; and, therefore, it cannot be presumed that they have done it."
~Justice Samuel Chase, Calder v. Bull (1978).

Interestingly, as an aside, Justice Chase was the only Supreme Court Justice ever to be impeached.  He apparently couldn't keep his political bias out of the courtroom.  He was eventually acquitted.  Still his wise words are often quoted and he recognized something that seems to be long forgotten.  The ultimate authority of the government comes from the sovereign - the people.  The government only has those powers which the people have given to it.

So, where did our Takings Clause jurisprudence go astray?  I had assumed that it was in relatively modern cases that came before Kelo - mainly Berman v. Parker (1954) and Hawaii Housing Authority v. Midkiff (1984).  This is also a common view among legal scholars.

First, in Berman, the Court upheld a taking associated with a redevelopment plan aimed at curing a large section of Washington D.C. of blight and substandard housing.  But rather than limiting their holding narrowly to blighted areas, the court stressed the deference to the legislature to determine public use.

"It is within the power of the legislature to determine that the community should be beautiful as well as healthy, spacious as well as clean, well-balanced as well as carefully patrolled... there is nothing in the 5th Amendment that stands in the way."

Next, in Midkiff, the Court upheld an Act in Hawaii that required lessors to sell property to their lessees.  Prior to Midkiff, 47% of the land in Hawaii was owned by 72 landowners - the result of the feudal land tenure system where all of the land was owned by chiefs and subchiefs.  This oligopoly was determined to be harmful to the real estate market that forced many to lease rather than buy. 

Rather than analyze the takings under a "use by the public test," the Court noted that "where the exercise of the eminent domain power is rationally related to a conceivable public purpose, the Court has never held a compensated taking to be proscribed by the Public Use Clause."  Expanding on the holding of Berman, the court held that "the public use requirement is coterminous with the scope of a sovereigns police power."

Again, Midkiff dealt with a very unique land oligopoly that does not exist anywhere else in the country.  This issue will never arise again.  But, rather than narrowly tailor their holding to this set of facts, the Court took the opportunity once again chip away at the Takings Clause.

Interestingly, both of the opinions in Berman and Midkiff were unanimous - there were no dissenting opinions.  Even more bizarre, Justis O'Connor authored the Court's opinion in Midkiff and a very strong dissent in Kelo.  She seemed to recognize this as a mistake.

"There is a sense that this troubling result [in Kelo] follows from certain errant language in Berman and Midkiff."

Translation:  Oops!  I might have screwed that up.

Justice O'Connor did make a compelling argument that Berman and Midkiff could have, and should have, been distinguished from Kelo.  The issues in both of the former cases dealt with the taking of property that was causing affirmative harm - the blight and substandard housing in Berman, and the oligopoly in Midkiff.

Regardless, the problem really started about 100 years earlier.  In various State courts, Mill-Dam Acts were upheld and they also showed extreme deference to legislatures in determining public use.

The Mill-Dam Acts allowed private mill owners to create dams, thereby flooding neighboring properties and depriving others of their property forever, for the purpose of operating mills. Arguably, the mills were necessary in agrarian communities and they were providing valuable services to the public.  Similar logic had already been used in rail road cases that took private land and gave it to private companies to operate rail lines.

One of the earliest Mill-Dam cases was Newcome v. Smith (Wisc. 1849).  Again, rather than a narrowly tailored opinion recognizing the important public interest served by mill operations (and the extent to which the public would use and benefit from them), the court issued a broad interpretation of the Takings Clause.

"If the public interest can be in any way promoted by the taking of private property, it must rest in the wisdom of the legislature to determine whether the benefit to the public will be of sufficient importance to render it expedient for them to exercise the right of eminent domain, and to authorize an interference with the private rights of individuals for that purpose."

Though those cases were mainly in the State courts, because the 5th Amendment had not been ruled applicable to the States through the 14th Amendment, the U.S. Supreme Courts were already following the same line of eminent domain analysis.  In West River Bridge v. Dix (1848), the Supreme Court held that eminent domain power could be used to take private property rights in contracts.

The West River Bridge Company was granted a contract to erect and operate a toll bridge for a period of 100 years.  Shortly thereafter, the State decided to use its eminent domain power to make the toll-bridge a part of the free highway system in the state.  Thus, depriving the company of their property rights in the contract.  Though the case was brought under the Contracts Clause, the court held that contracts are property and, thus, subject to the States eminent domain power. 

The Court held that the use of eminent domain is appropriate "whenever the public interest requires it," and that it "may be exercised, not only where the safety, but also where the interest, or even the expediency, of the State is concerned."

Thus, contrary to the view of many scholars, the shift in view of the Public Use Clause did not happen rather suddenly in recent history.  It has been a gradual erosion over more than 150 years.  In fact, it could be argued that the Court's deference to the legislature, and the broad interpretation of public use as public purpose or public interest, has been well established in our takings jurisprudence.  Only the cases that have been brought around them have changed - ever pushing the boundaries of the constitutionality of takings under the 5th Amendment.

This has created an absurd result that Justice Thomas pointed out rather well in his dissent in Kelo.  He argued that in interpreting the Constitution every phrase must be given meaning.  The plain language requires, and the concept is not disputed, that whenever private property is taken for public use, just compensation must be paid.  If the phrase "for public use" means anything, and the Court is willing to authorize takings for private use, it must mean that when private property is taken for private use - just compensation is not required.  Certainly, that cannot be the case.

The plain language of the Takings Clause seems to be clear.  The State cannot take private property unless it is to be for public use - not merely provide an incidental public benefit.  Any test that equates public use with public purpose, or public interest, must offend the Constitution.  Otherwise, the Takings Clause could be rewritten.

nor shall private property be taken for public use, without just compensation.

I'll leave you with Justice O'Connor's words from her dissent in Kelo that sums up the current state of our Supreme Court's interpretation of the Takings Clause.

"Under the banner of economic development, all private property is now vulnerable to being taken and transferred to another private owner, so long as it might be upgraded -- i.e. given to an owner who will use it in a way the legislature deems more beneficial to the public...

Nothing is to prevent the State from replacing any Motel 6 with a Ritz-Carlton, any home with a shopping mall, or any farm with a factory."

What do you think?  Should any taking that our legislature deems to be for the common good be acceptable?  Where would you draw the line on eminent domain?  Certainly, using the eminent domain power to acquire land for the rail roads has been nearly universally accepted as a legitimate use of the power - and the rail road companies are privately owned.  Is it okay to take homes within blighted areas when it is given to private owners who will create safe and affordable housing?  Is it okay to take someone's home when it can create jobs or a higher tax base?  How could you tailor a rule that would honor the original meaning of the Takings Clause and still be flexible enough to allow the government to meet the need of society?

Robert A. Franco
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