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Hawaii Housing Authority v. Midkiff

    Brief Fact Summary. The land in a state was owned only by a handful of people, so the state sought to redistribute ownership.

    Synopsis of Rule of Law. When the exercise of the eminent domain power is rationally related to a conceivable public purpose, the act of the state will be valid.

    Facts. Land in Hawaii remained in the hands of a few. To redress the problem, the legislature decided to compel the large landowners to break up their estates. They enacted legislation, which created a mechanism for condemning residential tracts and for transferring ownership of the condemned fee simple to existing lessees. The intent was to make the land sales involuntary, thereby making the federal tax consequences less severe while still facilitating the redistribution of fee simples. The state would transfer the land to the tenants living on them. Appellants seek to have the Act declared unconstitutional.

    Issue. Is it valid for a state to use its eminent domain power to take land from one property owner and transfer it to another, if the purpose was to remedy inequality in land ownership?

    Held. Yes.
    The public use requirement of the takings clause is coterminous with the scope of a sovereign’s police powers. The legislature defines what constitutes a taking for the public use, and their determination is subject only to specific constitutional limitations.
    When the exercise of the eminent domain power is rationally related to a conceivable public purpose, the court has never held a compensated taking to be proscribed by the Public Use Clause.
    The Hawaii Act is constitutional. Regulating oligopoly and the evils associated with it is a classic exercise of a state’s police powers.
    When the legislature’s purpose is legitimate and its means are not irrational, cases make clear that empirical debates over the wisdom of takings are not to be carried out in the courts. Redistribution of fee simple to correct deficiencies in the market determined by the state legislature to be attributable to land oligopoly is a rationale exercise of the eminent domain power. So, the statute passes the scrutiny of the Public Use Clause.

    Discussion. Even though the government never uses the land for itself, the transfer of property here falls under its eminent domain power. The state had a legitimate objective in redistributing land, so its act was justifiable under its police power.


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