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Voice of America's interview with Joseph T. Waldo on Virginia eminent domain cases for broadcast in China

September 26, 2003
By Voice of America

The following are excerpts from a Voice o f America broadcast, aired in Mainland China, discussing eminent domain and private property rights in the U.S. The broadcast included commentary from: 1) Joseph T. Waldo, eminent domain attorney in Virginia; 2) Dana Berliner, Attorney at the Institute for Justice, Washington D.C.; 3) Robin Paul Malloy, Professor of Law and Economics, Syracuse University College of Law; 4) Robert Brauneis, Professor of Law, George Washington University Law School; 5) Faron Stull, plaintiff in the Stull case;

In the US, the government sometimes takes private lands for public use, and demands the landowners to sell and move. Some people reluctantly reach agreements with the government and receive some compensation for moving, while some refuse to move, and, chose to fight for their own interests, even sue the government in court. In today's program, we will review cases of common people, to get an idea of the American legal rules on eminent domain.

The US Constitution establishes the basic parameters for eminent domain. The Fifth Amendment of US Constitution prescribes: “…Nor shall private property be taken for public use, without just compensation.” Dana Berliner , a senior attorney at the Institute for Justice in Washington DC, explains the meaning of this clause. She points out, “What this means is that if the government is going to take someone's property, there are two requirements. First of all, the government has to pay what is called just compensation. That means fair market value. The second requirement is that even if they pay that, still the government can only take property for a public use, and traditionally that has meant things like roads, bridges, things that will be either owned by the public or used by the public.”

Robin Paul Malloy , Professor of Law and Economics at Syracuse University College of Law, analyzes the basis of this rule, noting, “A basic idea in the Constitution is that private property is an important civil or human right. It is not just an economic right. The right should be protected for reasons that are beyond simply trying to create incentives for people to work hard by protecting their private property. It is a fundamental right like other human rights.”

These two constitutional requirements of eminent domain are also incorporated into almost every state Constitution. But, how do US courts interpret “just compensation” and “public use?” Robert Brauneis , a professor at the George Washington University Law School, explains: “The US Supreme Court has interpreted the public use limitation very broadly. It has said that anytime the government has any public purpose that it can articulate that it is served by the taking, it can go ahead and do it. For example, if the government says there is a slum in this area, we decide that the physical condition of the housing or the buildings in this are is bad and we want to replace them, that is enough. Some of the State Supreme Courts have been a little more stringent in their interpretation of the public use restriction. So in some cases a project might be okay under the federal Constitution, and yet a state court could find under state law it is not a public use.”

Professor Brauneis further explains the court's interpretation of just market price, saying, “In a court proceeding, experts will be called to testify about similar sales or sales of similar property in the area, how much these properties sold for and how much this property would sell for if it were not being taken forcibly but were for sale by the owner and that owner would get bids from various purchasers to pay for the property. That measure of just compensation clearly does not compensate owners for some of the damage that they may suffer when the property is taken forcibly. For example, if I have an existing business that runs on this land and if I have to relocate my business, I will lose some of my current customers and I will have to build up a new customer base. ‘Just compensation' generally does not call for any compensation for that loss in customers or the loss in the value of my business, nor does it compensate for the cost for relocation, the cost that I would have to pay to get a moving company to move my business to a new site.”

The family of one party of the case, Faron Stull , owned a dairy operation, where they had lived and worked for over 70 years. But, one day, the Virginia Department of Transportation notified them that the government planned to build a road near their dairy, and that some feed barns, milking barns, and dairy processing barns had to be destroyed. Faron Stull recounts the case: “It started roughly, I would say, in March 2001. The state contacted us about redoing the road by our dairy operation. After it was surveyed and everything said and done, their offer to us was $75,000. So we told the state we wouldn't take that. They said they would condemn us and shove us out of the way, saying ‘That is our final offer.' That is when we got in contact with Mr. Waldo.”

Joseph Waldo , who specializes in eminent domain cases, represented the Stull family and sued the Virginia government in court. He says that the Stulls did not want to sell their real estate, but under the government's pressure, they had to choose to ask the court to at least protect their economic interest on the grounds of the constitutional principle of just compensation. He notes, ‘The government came to the Stull family with an appraisal from an appraiser. He said the fair market value was $75,000. So the way the law works is that $75,000 was given to the Stulls and the state got the buildings and took them down, since it owned the land underneath the buildings to build the new road. The Stulls took the $75,000, which they are entitled to do in Virginia, and then went to court before a jury to ask for a larger award. We call the just compensation.”

Just compensation is guaranteed by the US Constitution. And also the State Constitution of Virginia declares that no property shall be taken without due process of law or without just compensation. So the Constitution protects property owners and gives them the right and the ability to challenge the government sometimes when the government is wrong. Joseph Waldo recounts the court's decision, saying, “The system we use in Virginia is similar to what we use in many state in the United States. At the end of two days of trial, the jury awarded the Stull family more than $350,000, which is what they were asking for. Even though the jury in Virginia does not have to be unanimous, this particular jury reached an unanimous verdict.”

Even after paying attorney's fees, the Stulls finally got the compensation of about $300,000 from the state of Virginia. Although he still not completely satisfied with this result, Stull says, this is much better than the government's original offer. Stull complains: “They can do basically what they want to do. What this tells you is: ‘You think you pay taxes and own your buildings, but if the state wants it, you don't own a thing.' That is basically what it is.”

Of course, Chinese and American law handle property rights differently.