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Overview of eminent domain

On Behalf of | Dec 22, 2021 | Eminent Domain

If you live in California, you may benefit from learning more about eminent domain. The term eminent domain refers to the government’s power to take private property and convert it to public use. The Fifth Amendment of the U.S. Constitution states that the government can only exercise this power if the property owners are provided with just compensation.

Understanding eminent domain

Private property is obtained by the government through condemnation proceedings. Here, property owners have the opportunity to challenge the seizure’s legality or settle on fair market value for compensation. The most common example of using condemnation proceedings for eminent domain involves seizing land or buildings for public projects. This could be for anything involving water, airspace, rock, dirt or timber taken from private land for the construction of public roads or infrastructure.

Eminent domain and intellectual property

Eminent domain can also apply to investment funds, leases and stocks. Other types of intellectual property that could be subject to eminent domain include patents, copyrights and contract rights. In 2013, several municipalities considered using eminent domain as a tool for refinancing underwater mortgages by seizing from investors at their market rate and reselling them for more favorable rates. In 2015, Congress passed laws prohibiting the Federal Housing Administration from financing mortgages seized through eminent domain.

Eminent domain in court

Property owners can file a claim against the government in a process called inverse condemnation. This proceeding occurs when a property owner has been unfairly compensated or when the property is damaged by the government. Inverse condemnation is often used to obtain damages for environmental problems like pollution. Electrical utilities could be found liable for economic damages caused by wildfires and power lines.

Ultimately, property owners have rights when the government attempts to purchase or seize their property. It’s important for property owners to understand these rights and protect them.