REAL ESTATE NEWS by Attorney Margaret Norman

Sandra Day O’Connor and Eminent Domain

The resignation of Supreme Court Justice Sandra Day O’Connor on July 1, 2005 and the declining health of Justice Rehnquist means that President Bush will have the opportunity to nominate 2 judges to the Supreme Court. This will be the first new justice to the Supreme Court in 11 years. Could it make a difference to your life or your property?

The recent Eminent Domain case involving New London, Connecticut was decided by the U.S. Supreme Court on June 23, 2005. The Supreme Court ruled 5 to 4 in favor of The New London Economic Development group to use Eminent Domain to take private property and transfer it to another owner to use in a way that they decided might be more beneficial to the public.

The property would not be taken to directly use it for the public, for instance to use the land for schools or parks, but given to a developer. In fact one of the parcels would be used for a parking lot. The Connecticut Supreme Court ruled that promoting economic development outweighed private property rights. The U.S. Supreme Court agreed with them.

Sandra Day O’Connor and Justice Rehnquist were two of the 4 dissents in the New London case. A dissent means that they do not agree with the majority. Five judges voted to allow the wealthy developers to prevail over the owners of the property. In the Supreme Court, majority rules.

Justice Sandra Day O'Connor wrote a dissent which is an opinion stating that cities should not have unlimited authority to uproot families, even if they are provided compensation, simply to accommodate wealthy developers.

"Any property may now be taken for the benefit of another private party, but the fallout from this decision will not be random," she wrote. "The beneficiaries are likely to be those citizens with disproportionate influence and power in the political process, including large corporations and development firms."

Justices O’Connor and Rehnquist were outnumbered in this decision which affected several families who had property on the water. Those properties were not blighted. Until now, families in Manhattan, Hermosa, Redondo and other waterfront communities from Malibu to Laguna Beach thought eminent domain just involved the poor in blighted areas that were doing slum clearance, or needed land for the airport. Many of us thought that expensive water front land would be immune from unwanted sale, and many in the legal community were surprised at the Supreme Court’s opinion in this case.

Justice O’Connor was appointed by President Reagan in 1981. She became the first woman to serve on the nation's highest court. In her 24 years on the Court, O'Connor's votes were sometimes difficult to predict and the most coveted because her moderation and centrist position on the Court often made her the swing vote in controversial cases. As she leaves, and Justice Rehnquist’s health declines, a change of two justices could have a drastic impact on the court. The next case might involve the loss of rights you thought you had.