June 24, 2005 – In a five-to-four ruling yesterday, the United States Supreme Court held that local governments may forcibly purchase property from one owner and provide it to a private developer.
The case, Kelo v New London, arose after several residents of the Connecticut city refused to sell their homes to make way for planned development of hotels, restaurants and other "mixed use" venues along the Thames River. In 2000, New London condemned the fifteen homes belonging to holdouts, prompting a lawsuit by the homeowners that made it to the state Supreme Court last year.
A four-to-three decision by the Connecticut Supreme Court held that New London did not violate the homeownerâ€™s rights in condemning the property for purposes of economic development. Yesterdayâ€™s five-to-four US Supreme Court decision upheld that ruling, finding that "because that plan unquestionably serves a public purpose, the takings challenged here satisfy the Fifth Amendment."
The takings clause of the Fifth Amendment allows for what the courts call "eminent domain," whereby a government can take private property for "public use" as long a "just compensation" is provided.
In arguments, the plaintiffs asked the Court to invalidate the use of eminent domain laws solely for private economic development.
In the majority opinion denying the request, Justice John Paul Stevens wrote that the "petitioners proposal that the Court adopt a new â€˜bright-lineâ€™ rule that economic development does not qualify as a public use is supported by neither precedent nor logic."
The dissenting opinion, written by Justice Sandra Day Oâ€™Connor, charged that yesterdayâ€™s decision effectively nullified the Fifth Amendment and bodes ill for the economically disadvantaged. "The government now has license to transfer property from those with fewer resources to those with more. The Founders cannot have intended this perverse result," Oâ€™Connor said.
Susette Kelo, the lead petitioner, said in a statement after the ruling, "I was in this battle to save my home and, in the process, protect the rights of working class homeowners throughout the country. I am very disappointed that the Court sided with powerful government and business interests, but I will continue to fight to save my home and to preserve the Constitution."
The Institute for Justice, the nonprofit libertarian law clinic that represented the homeowners, has pledged to fight against the use of eminent domain laws for private development in state courts, according to Chip Mellor, president of the organization.
Justice John Paul Stevens wrote the majority opinion and was joined by Justices David Souter, Stephen Ginsberg and Stephen Breyer. Justice Anthony Kennedy wrote a separate concurring opinion.