Eminent domain is defined as a mandatory transfer of a real or leasehold interest in a piece of property to a governmental entity for a public purpose. The action of the transfer through eminent domain is known as condemnation or a taking. This transfer, dictated by state law and/or constitutions, is to be undertaken only when a public purpose outweighs the interests of an individual property owner.

The property owner is then entitled to a market value that is fair and reasonable, or “just compensation” as guaranteed in the U.S. Constitution. The rationale for the use of eminent domain is often financial. Eminent domain has been used to keep the cost of a project manageable when one property owner blocks a project by either refusing to sell or holding out for a very high purchase price.

• Publication date: April 2019