The Fifth Amendment’s Takings Clause provides “nor shall private property be taken for public use without just compensation.” The Takings Clause therefore raises three distinct legal questions: First, when has property been “taken,” triggering the just compensation requirement? This is the question raised in “regulatory takings” cases. Second, to what extent does the clause prohibit takings except for “public uses”? This is the question raised in “public use cases,” when the government takes property by eminent domain with the intention of transferring it to a private party.1 These first two questions receive the most scholarly attention.
In the recent article What is Just Compensation?, Wanling Su provides a deep historical analysis and unique process-based focus on the third question triggered in Takings Clause analysis—what amount of compensation for property that is taken is “just”? This is the question raised whenever the government takes property, by eminent domain or otherwise, and property owners are entitled to be compensated for their loss.
Su’s work examines the question that has—perhaps not surprisingly—received the least attention in the scholarly literature on takings. But that is not to say that it has received no attention.
Scholars addressing the question typically assume that property owners are systematically undercompensated when their property is taken, although this assumption has been challenged, including by me.2 Concerns about under-compensation flow from the substantive legal standard used to determine what compensation is due when property is taken by the government (by eminent domain or regulation).
In United States v. Miller, the Supreme Court held that “just compensation” is the equivalent of “fair market value”—that is, the price that a willing buyer and willing seller would agree upon in a voluntary market transaction.3 There are many problems with applying this standard in the takings context—including the facts that the seller is typically unwilling and the market is nonexistent, leading to a high risk of error. Scholarly commentators primarily focus on the fact that the “fair market value” standard fails to take into account factors such as the owner’s subjective attachment to her property.4
Su approaches the question from a different angle by focusing on process rather than substance. Su argues, convincingly in my view, that the Fifth Amendment’s “just compensation” requirement requires a jury determination of the compensation due when property is taken by the government.
Historically, the article is a tour de force. It links the right to a jury determination of value to the ancient English common law writ of Ad Quod Damnum (“to what damage”). (P. 1492.) Su traces the jury requirement in the takings context as far back as 1086, when William the Conqueror surveyed all the value of lands in England, relying entirely on jury assessments, for the Domesday Book. (P. 1498.) She demonstrates that the right of a jury assessment of value when property is taken was required by the Magna Carta (Pp. 1501-03), was endorsed by the Framers of the Constitution (Pp. 1506-09), and was assumed to be required by courts throughout the colonial and early republican eras. (Pp. 1505-13.)
Her historical analysis leaves, in my mind at least, little question that the Seventh Amendment, as originally understood, guarantees a jury determination of what compensation is “just” when private property is taken. She calls the constitutionality of alternatives to jury determinations, such as the commissions permitted by the Federal Rules of Civil Procedure,5 into serious question. And, she urges the federal courts to restore the proper understanding of the just compensation required by guaranteeing a right to a jury determination of property values. (Pp. 1518-27.) I’m convinced that she’s right on this important point.
That said, I remain uncertain whether her argument satisfactorily answers the question of whether the compensation awarded when property is taken is “just” or not. My uncertainty flows from three concerns.
The first is that, although the Fifth Amendment’s takings clause has been incorporated against the states, the Seventh Amendment’s jury right has not been incorporated against the states.6 So it is not clear whether the jury-right identified by Su applies to the vast majority of takings, which are accomplished by state and local—not federal—actors.
The second is that, as I have previously argued, most compensation calculations result from bargains made in the shadow of eminent domain—not in eminent domain proceedings, judicial or otherwise. That is to say, most of the time, private property owners accept the compensation offered by government actors under the threat of eminent domain. (Pp. 126-30.) They have good reason to do so since eminent domain proceedings impose what Thomas Merrill has called high “due process costs” on both bargaining parties.7 Jury trials undoubtedly increase those costs, perhaps further deterring private property owners from challenging compensation offers. (Of course, jury trials impose high due process costs on both sides, so a jury guarantee might increase compensation offers.)
The third, and most important, of my concerns is the following: Su offers a procedural solution to a substantive problem. If the fair-market-value standard systematically results in under-compensation by disregarding important “values” (such as subjective attachment to property), then restoring the right to a jury determination of fair-market value does not solve the under-compensation problem. It might be that juries are more sensitive to such attachments and will increase compensation awards to compensate for them. But, Su’s own analysis suggests that this isn’t necessarily the case.
In the end, Su’s account of the jury process for just compensation determinations does not leave assurances that jury awards will be just. Nevertheless, she provides a convincing account of why justice requires jury awards in the case of takings, adding an important perspective and new historical insights into the takings discussion.
- Justice Thomas recently suggested that the public use limitation also applies in regulatory takings cases, but the court has not ever applied it in this context. Horne v. U.S. Dep’t of Agriculture, 135 S.Ct. 2419, 2433 (2015) (Thomas, J., concurring).
- See Nicole Stelle Garnett, The Neglected Political Economy of Eminent Domain, 105 Mich. L. Rev. 102 (2006) (reviewing literature on under-compensation). See also Brian Angelo Lee, Just Undercompensation: The Idiosyncratic Premium in Eminent Domain, 113 Colum. L. Rev. 593 (2013).
- 317 U.S. 369 (1943).
- Garnett, supra note 2, at 106-10 (reviewing literature).
- Fed. R. Civ. P. 71.1(h)(2)(A) (“If a party has demanded a jury, the court may instead appoint a three-person commission to determine compensation because of the character, location, or quantity of the property or for other just reasons.”).
- See generally Steven G. Calabresi & Sarah E. Agudo, Individual Rights Under State Constitutions when the Fourteenth Amendment Was Ratified in 1868: What Rights Are Deeply Rooted in American History and Tradition?, 87 Tex. L. Rev. 7, 78 (2008) (“[T]he Supreme Court’s failure to incorporate the Seventh Amendment, when it has incorporated almost all of the rest of the Bill of Rights, is quite odd and perhaps mistaken.”).
- Thomas W. Merrill, The Economics of Public Use, 72 Cornell L. Rev. 61, 84 (1986).