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Eminent domain ruling causes no imminent change in South Carolina
By Rachel Pleasant
Staff Writer
The U.S. Supreme Court handed down a controversial 5-to-4 decision in late June, deciding that a Connecticut city could use its power of eminent domain to seize private properties to make way for economic development projects.
Local lawyers and government officials, however, say that for all the attention Kelo v. New London (Conn.) is getting, the decision is likely to have little bearing on decisions made in South Carolina or the Charleston area.
“I think the decision is significant, and I think it’s unfortunate because property owners don’t have the Fifth Amendment (guaranteeing the right to property) to turn to (now),” says Rick Bybee, a partner in Mount Pleasant’s Smith Bundy Bybee & Barnett, who handles eminent domain and real estate litigation.
“I think it’s significant, but because of the constitution of South Carolina, we can still protect the very property rights that will perhaps not be protected in other states.”
Kelo v. New London
Kelo v. New London involved the city’s plans for revitalization after decades of economic decline.
The plans included a waterfront conference hotel, restaurants and shops, 80 new residences, research and development office space, and a renovated marina, all with the purpose of creating 1,000 jobs and increasing tax and other revenue.
To assemble the land for the project, the city’s development agent purchased property from those willing to sell. Eminent domain was used to condemn the properties of those unwilling to cooperate.
Among those homeowners who refused to sell was Susette Kelo, who had lived in her home since 1997 and had made improvements to her property. Like Kelo’s home, none of the 15 properties involved were blighted or in poor condition.
Defining public use
What the Supreme Court did in deciding the Kelo case, says Sheryl Schelin, a staff attorney for Horry County who works with eminent domain cases, was redefine the term “public use.” The Fifth Amendment provides that private property can be taken for public use only with just compensation.
“Up until the Kelo case, when a local government took private property, they had to do it for a public purpose. You can’t just take it and sell it for a commercial interest,” Schelin says.
“For instance, drug houses can be taken because that will no longer be tolerated in a community. This was a little different situation because now we have the understanding that the public purpose test is met even though a property is not blighted.”
Though the Kelo v. New London decision is the law according to the Supreme Court, individual states can provide additional protections. Such is the case in South Carolina, say a handful of Charleston’s lawyers who deal with eminent domain issues every day.
According to the South Carolina constitution, no one can be denied property without the due process of law, and private property cannot be taken for public use without just compensation.
In South Carolina, the term “public use” is strictly interpreted.
“I’m not sure (Kelo v. New London) will have a major impact here. Public use is much stricter here than in the U.S. Supreme Court,” says Bybee, who typically represents property owners in eminent domain cases.
As an example of eminent domain for public use in South Carolina, and specifically Charleston, attorney James A. Stuckey points to the Arthur Ravenel Jr. Bridge project.
“It has to serve a public purpose, and this is a good example,” says Stuckey who represents government agencies in eminent domain cases. Under the threat of condemnation, owners were given the chance to sell their properties, making way for the new bridge.
“They were paid not exorbitant but very high prices.”
Reducing the impact
The U.S. Supreme Court’s decision may be final, but Congress has options, and it intends to use them.
The House of Representatives recently passed a bill that would deny federal funds to any city or state project that used eminent domain as a method of forcing people to sell their property, making way for profit-making projects, such as those in the New London case, the The Washington Post reported.
The move, if passed by Congress, will make it even more unlikely the Supreme Court’s decision will have an impact in communities, including Charleston.
“Federal funds are the driving force behind all this,” Stuckey says. “If you can’t use federal funds, that would substantially cut down on efforts to do projects.”
North Charleston Mayor Keith Summey says eminent domain is always a touchy subject and something that should be used carefully. The Supreme Court’s decision won’t change that.
“I don’t think you’re going to see any radical changes,” Summey says. “You have to use eminent domain very carefully, and in my 11 years as mayor, we’ve never used it.”
Rachel Pleasant is a staff writer for the Business Journal. E-mail her at rpleasant@crbj.com.
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