Goldwater Institute Asks AZ Supreme Court to Ensure Just Compensation for Property Owners

The Goldwater Institute filed a brief in the Arizona Supreme Court today asking the justices to reverse a lower court’s decision that effectively rewrote the state’s eminent domain laws in a way that denies compensation to certain property owners whose rights are diminished by the government. State law provides for “severance” and “proximity damages”—which compensates property owners when their land isn’t taken through eminent domain but is damaged by the use of eminent domain. But a state appellate court held that this only applies to cases where the damaged property is a “parcel”—thus ruling out compensation in cases where the government damages a more abstract right, such as an easement. Worse still, the court said that if a property owner can’t point to a statute that provides compensation, the owner is out of luck.

That’s wrong. As we explain in the brief, not only does Arizona law provide compensation for the damage to a person’s easement rights, but the state Constitution promises compensation even if there’s no statute on the books that says so. That’s because Arizona’s Constitution requires the government to pay not only when it takes property, but also when it “damages” property—and that word was added to the state Constitution precisely to cover situations in which public construction projects intruded on people’s property without actually confiscating it.

The case arose from the construction of a freeway, which required the government to use eminent domain to take not only some actual land, but also the rights of access to that land—rights that were held by some nearby homeowners. They asked for compensation, arguing that while their homes themselves had not been condemned, those access rights were, and that they were entitled to be paid for those rights under a statute that guarantees “proximity” and “severance” damages.

But the court ruled that these damages weren’t available. It reasoned that while the law requires payment “[i]f the property sought to be condemned constitutes … a part of a larger parcel,” the word “property” in this sentence should actually say “parcel”—in other words, that compensation is only provided if what’s taken is a piece of actual land, not if what’s taken is an abstract right like a right of access.

The problem with that is that courts aren’t supposed to rewrite laws—they’re supposed to apply them as written. And even if the statute did say that people only get compensation if a “parcel” is taken, that wouldn’t be enough to satisfy the Arizona Constitution, which expressly promises compensation not only when property is taken, but also when it’s damaged. That word “damaged,” which doesn’t appear in the federal Constitution, was added to state constitutions during the nineteenth century due to public works projects such as railroad construction that infringed on neighboring property owners without actually taking their property. In other words, even if Arizona’s compensation law didn’t apply here, the state Constitution still requires compensation for the damaging of these homeowners’ property—which, in this case, is their right of access.

State constitutions often provide stronger protections for individual rights than the federal Constitution does—and often because of the experiences of the nineteenth century, when technological and social innovations brought about new problems that the federal Constitution’s authors hadn’t thought of. The result was provisions such as the “or damaged” phrase in the Grand Canyon State’s basic law. As part of Goldwater’s mission to enforce these broader rights-protections, we’re asking the Arizona Supreme Court to take up this case and make clear that property owners enjoy full security for their rights—including the promise of just compensation when their property is damaged.

You can read our brief here and learn more about our work to defend property rights here.

Timothy Sandefur is the Vice President for Legal Affairs at the Goldwater Institute.