The Difference Between the Government Taking of Private Property and Exercising

The general rule is that when the government takes private land for public use, it must pay the fair market value for the private land or property taken. This is a constitutional requirement. This requirement applies when the government exercises its power of eminent domain. However, there is a different rule with regard to payment of compensation when the government exercises its police power. As the North Carolina Supreme Court has stated:

"The state must compensate for property rights taken by eminent domain; damages resulting from the exercise of the police power are noncompensable."

Barnes v. North Carolina State Highway Commission, 126 SE 2d 732 (NC Supreme Court 1962). Here is a brief explanation of the difference between the government using its power of eminent domain and its police powers.

Generally, if there is a "physical taking" or "physical invasion," that is deemed by courts to be a taking as a matter of law and fair market value must be paid. Legally, this is called a per se taking. Thus, for example, if the government takes title to and physical possession of a strip of land from a private person or entity to widen a local road, then fair compensation must be paid for the strip of land. That is the exercise of eminent domain and fair compensation must be paid.

In general, if the government takes some action -- like enacting a statute or promulgating a regulation -- that does not involve a physical taking or invasion but damages private property or diminishes its value, then it is possible to make a claim for a taking by the government for which compensation must be paid. This is called an inverse condemnation claim. However, it is also possible that the government action is a legitimate use of its police power. Under those circumstances, no compensation is required.

An easily understood example comes from a South Carolina case involving spraying of mosquito control pesticides. See Yawn v. Dorchester County, 446 F. Supp. 3d 41 (US Dist. Court, D. South Carolina 2020). In that case, the South Carolina county sprayed to control mosquitos in response to health and safety concerns involving the Zika virus (spread, in part, by mosquitos). The persons who sued owned a beekeeping business and millions of bees were killed as a result of the spraying. The plaintiffs sued claiming that their property -- the bees -- were taken and that the County owed them just compensation.The court, however, said "no." To quote the court:

"It is undisputed that the spray was conducted to prevent the spread of disease, a matter that would affect public health. Such an action fits squarely within the state's police power... The loss of Plaintiff's bees was unintentional; it was an unfortunate consequence to a proper exercise of Defendant's police power. Because Defendant was exercising its police power, and not its power of eminent domain, the Takings Clause is not implicated."

As such, the South Carolina County was not required to pay compensation to the bee owners.

Here in North Carolina, the most prominent case involving the distinction between use of the power of eminent domain and the police power is the famous case of Kirby v. North Carolina Department of Transportation, 786 SE 2d 919 (NC Supreme Court 2016). That case involved the MAP Act under which the North Carolina Department of Transportation was empowered to designate land as future road corridors. If land was so designated, there were significant and hefty limitations on what the landowners could do with their land. Various landowners sued, claiming that the MAP Act was a taking and that they were owed just compensation.

In defending, the NCDOT argued that they had not physically taken the land and that it was exercising legitimate police powers for which no compensation was due. The North Carolina Supreme Court disagreed. The court stated:

"The Map Act's indefinite restraint on fundamental property rights is squarely outside the scope of the police power.... The societal benefits envisioned by the Map Act are not designed primarily to prevent injury or protect the health, safety, and welfare of the public."

The court concluded that the MAP Act was primarily the use of the State's power of eminent domain. As such, the landowners were entitled to compensation for the taking of their property rights.

For more information, and to schedule a confidential consultation with experienced and dedicated eminent domain and condemnation attorneys in Charlotte, contact Arnold & Smith, PLLC. Use our “Contact” page or give us a call at 704-370-2828. We handle land use, zoning and condemnation legal matters in federal court, in Mecklenburg County and elsewhere in North Carolina. We have offices in Charlotte, Lake Norman, and Union County.