Inverse condemnation refers to a legal process in which the government seizes private property and fails to provide just compensation for the taken property. When the government takes property, it is called “condemning” it through eminent domain. If the government fails to provide just compensation, the former owner may sue the government under the Fifth Amendment.
Defining “Taking”
The government can take property in several ways. For example, the government can seize the property for public use, such as taking private houses to make space for a new highway or airport expansion. The government can also deny property owners access to their property by removing ground support or access.
Finally, the government can also impose regulations so demanding that it denies the reasonable owner value, utility, or marketability (i.e., a regulatory taking). However, regulatory takings are controversial and usually need to be severe enough to deny the property nearly all economic use. Therefore, even if the regulation denies the property owner the intended use for the property, but there remain other uses, a claim for regulatory taking may still fail.
Inverse Condemnation Explained
The government can take private property for the public good – which is how freeways and border walls were built. However, the government must provide just compensation for the property. If the government fails to provide compensation, the owner has a claim for inverse condemnation.
Even if the government doesn’t take the property directly but engages in an action that reduces its use or value, the owner may still have a claim. For example, suppose the government builds a freeway onramp next to an outdoor restaurant. The restaurant owner may claim inverse condemnation because the noise, pollution, and lost sunlight dramatically reduced the value of the property. The restaurant owner may request the government to build abatement structures to reduce the noise pollution, such as a sound barrier wall, or provide adequate compensation to assist the owner in moving his or her establishment.
Another common problem arises when a local government condemns a property piece for development but fails to complete the project. The business owner is left with lost revenue and increased expenses because he or she relied on the condemnation. Those losses are compensable. Unfortunately, governments abandon projects all the time, forcing business owners to absorb thousands of dollars of losses.
