467 U.S. 229
Nos. 83-141, 83-236
Argued March 26, 1984.
Decided May 30, 1984.
The syllabus constitutes no part of the opinion of the Court
but has been prepared by the Reporter of Decisions for the
convenience of the reader. See United States v. Detroit Lumber
Co., 200 U.S. 321, 337, 26 S.Ct. 282, 287, 50 L.Ed. 499.
reduce the perceived social and economic evils of a land oligopoly
traceable to the early high chiefs of the Hawaiian Islands,
the Hawaii Legislature enacted the Land Reform Act of 1967
(Act) which created a land condemnation scheme whereby title
in real property is taken from lessors and transferred to
lessees in order to reduce the concentration of land ownership.
Under the Act, lessees living on single-family residential
lots within tracts at least five acres in size are entitled
to ask appellant Hawaii Housing Authority (HHA) to condemn
the property on which they live. When appropriate applications
by lessees are filed, the Act authorizes HHA to hold a public
hearing to determine whether the State's acquisition of the
tract will "effectuate the public purposes" of the
Act. If HHA determines that these public purposes will be
served, it is authorized to designate some or all of the lots
in the tract for acquisition. It then acquires, at prices
set by a condemnation trial or by negotiation between lessors
and lessees, the former fee owners' "right, title, and
interest" in the land, and may then sell the land titles
to the applicant lessees. After HHA had held a public hearing
on the proposed acquisition of appellees' lands and had found
that such acquisition would effectuate the Act's public purposes,
it directed appellees to negotiate with certain lessees concerning
the sale of the designated properties. When these negotiations
failed, HHA ordered appellees to submit to compulsory arbitration
as provided by the Act. Rather than comply with this order,
appellees filed suit in Federal District Court, asking that
the Act be declared unconstitutional and that its enforcement
be enjoined. The court temporarily restrained the State from
proceeding against appellees' estates, but subsequently, while
holding the compulsory
arbitration and compensation formulae provisions of the Act
unconstitutional, refused to issue a preliminary injunction
and ultimately granted partial summary judgment to HHA and
private appellants who had intervened, holding
230 the remainder of the Act constitutional
under the Public Use Clause of the Fifth Amendment, made applicable
to the States under the Fourteenth Amendment. After deciding
that the District Court had properly not abstained from exercising
its jurisdiction, the Court of Appeals reversed, holding that
the Act violates the "public use" requirement of
the Fifth Amendment.
The District Court was not required to abstain from exercising
its jurisdiction. Pp. 2325-2328.
Abstention under Railroad Comm'n v. Pullman Co., 312 U.S.
496, 61 S.Ct. 643, 85 L.Ed. 971, is unnecessary. Pullman
abstention is limited to uncertain questions of state law,
and here there is no uncertain question of state law, since
the Act unambiguously provides that the power to condemn
is "for a public use and purpose." Thus, the question,
uncomplicated by ambiguous language, is whether the Act
on its face is unconstitutional. Pp. 2325-2326.
Nor is abstention required under Younger v. Harris, 401
U.S. 37, 91 S.Ct. 746, 27 L.Ed.2d 669. Younger abstention
is required only when state-court proceedings are initiated
before any proceedings of substance on the merits have occurred
in federal court. Here, state judicial proceedings had not
been initiated at the time proceedings of substance took
place in the District Court, the District Court having issued
a preliminary injunction before HHA filed its first state
eminent domain suit in state court. And the fact that HHA's
administrative proceedings occurred before the federal suit
was filed did not require abstention, since the Act clearly
states that those proceedings are not part of, or are not
themselves, a judicial proceeding. Pp. 2326-2329.
The Act does not violate the "public use" requirement
of the Fifth Amendment. Pp. 2329-2331.
That requirement is coterminous with the scope of a sovereign's
police powers. This Court will not substitute its judgment
for a legislature's judgment as to what constitutes "public
use" unless the use is palpably without reasonable
foundation. Where the exercise of the eminent domain power
is rationally related to a conceivable public purpose, a
compensated taking is not prohibited by the Public Use Clause.
Here, regulating oligopoly and the evils associated with
it is a classic exercise of a State's police powers, and
redistribution of fees simple to reduce such evils is a
rational exercise of the eminent domain power. Pp. 2330-2331.
The mere fact that property taken outright by eminent domain
is transferred in the first instance to private beneficiaries
does not condemn that taking as having only a private purpose.
Government does not itself have to use property to legitimate
the taking; it is only the taking's purpose, and not its
mechanics, that must pass scrutiny under
231 the Public Use Clause. And
the fact that a state legislature, and not Congress, made
the public use determination does not mean that judicial
deference is less appropriate. Pp. 2331-2332.
F.2d 788 (CA9 1983), reversed and remanded.
H. Tribe, Special Deputy Attorney General of Hawaii, argued
the cause for appellants.
With him on the briefs for appellants in Nos. 83-141
and 83-283 were Kathleen M. Sullivan and David Rosenberg,
Special Deputy Attorneys General, Tany S. Hong, Attorney General,
Michael A. Lilly, First Deputy Attorney General, Dennis E.
W. O'Connor, James H. Case, and A. Bernard Bays. Richard J.
Archer and Corey Y. S. Park filed briefs for appellants in
R. Ashford argued the cause for appellees.
With him on the brief were E. Barrett Prettyman, Jr.,
B. Evan Bayh III, Rosemary T. Fazio, G. Richard Morry, and
Earl T. Sato.<<dagger>>
Briefs of amici curiae urging affirmance were filed for the
Office of Hawaiian Affairs by H. K. Bruss Keppeler; for the
Pacific Legal Foundation by Ronald A. Zumbrun and Harold J.
Hughes; and the the Queen Liliuonkalani Trust et al. by Daniel
A. Dobrovir and Joseph D. Gebhardt filed a brief for the Hou
Hawaiians et al. as amici curiae.
O'CONNOR delivered the opinion of the Court.
Fifth Amendment of the United States Constitution provides,
in pertinent part, that "private property [shall not]
be taken for public use, without just compensation."
These cases present the question whether the Public Use Clause
of that Amendment, made applicable to the States through the
Fourteenth Amendment, prohibits the State of Hawaii from taking,
with just compensation, title in real property from
lessors and transferring it to lessees
in order to reduce the concentration of ownership of fees
simple in the State. We conclude that it does not.
Hawaiian Islands were originally settled by Polynesian immigrants
from the western Pacific. These settlers developed an economy
around a feudal land tenure system in which one island high
chief, the ali'i nui, controlled the land and assigned it
for development to certain subchiefs. The subchiefs would
then reassign the land to other lower ranking chiefs, who
would administer the land and govern the farmers and other
tenants working it. All land was held at the will of the ali'i
nui and eventually had to be returned to his trust. There
was no private ownership of land. See generally Brief for
Office of Hawaiian Affairs as Amicus Curiae 3-5.
in the early 1800's, Hawaiian leaders and American settlers
repeatedly attempted to divide the lands of the kingdom among
the crown, the chiefs, and the common people. These efforts
proved largely unsuccessful, however, and the land remained
in the hands of a few. In the mid-1960's, after extensive
hearings, the Hawaii Legislature discovered that, while the
State and Federal Governments owned almost 49% of the State's
land, another 47% was in the hands of only 72 private landowners.
See Brief for the Hou Hawaiians and Maui Loa, Chief of the
Hou Hawaiians, as Amici Curiae 32. The legislature further
found that 18 landholders, with tracts of 21,000 acres or
more, owned more than 40% of this land and that on Oahu, the
most urbanized of the islands, 22 landowners owned 72.5% of
the fee simple titles. Id., at 32-33. The legislature concluded
that concentrated land ownership was responsible for skewing
the State's residential fee simple market, inflating land
prices, and injuring the public tranquility and welfare.
To redress these problems, the legislature
decided to compel the large landowners to break up their estates.
The legislature considered requiring large landowners to sell
lands which they were leasing to homeowners. However, the
landowners strongly resisted this scheme, pointing out the
significant federal tax liabilities they would incur. Indeed,
the landowners claimed that the federal tax laws were the
primary reason they previously had chosen to lease, and not
sell, their lands. Therefore, to accommodate the needs of
both lessors and lessees, the Hawaii Legislature enacted the
Land Reform Act of 1967 (Act), Haw.Rev.Stat., ch. 516, which
created a mechanism for condemning residential tracts and
for transferring ownership of the condemned fees simple to
existing lessees. By condemning the land in question, the
Hawaii Legislature intended to make the land sales involuntary,
thereby making the federal tax consequences less severe while
still facilitating the redistribution of fees simple. See
Brief for Appellants in Nos. 83-141 and 83-283, pp. 3-4, and
the Act's condemnation scheme, tenants living on single‑family
residential lots within developmental tracts at least five
acres in size are entitled to ask the Hawaii Housing Authority
(HHA) to condemn the property on which they live. Haw.Rev.Stat.
§§ 516-1(2), (11), 516-22 (1977). When 25 eligible tenants,
[FN1] or tenants on half the lots in the tract, whichever
is less, file appropriate applications, the Act authorizes
HHA to hold a public hearing to determine whether acquisition
by the State of all or part of the tract will "effectuate
the public purposes" of the Act. § 516-22. If HHA finds
that these public purposes will be served, it is authorized
234 to designate some or all of
the lots in the tract for acquisition. It then acquires, at
prices set either by condemnation trial or by negotiation
between lessors and lessees, [FN2] the former fee owners' full "right, title,
and interest" in the land. § 516-25.
An eligible tenant is one who, among other things, owns a
house on the lot, has a bona fide intent to live on the lot
or be a resident of the State, shows proof of ability to pay
for a fee interest in it, and does not own residential land
elsewhere nearby. Haw.Rev.Stat. §§ 516-33(3), (4), (7) (1977).
See § 516‑56 (Supp.1983). In either case, compensation
must equal the fair market value of the owner's leased fee
interest. § 516-1(14). The adequacy of compensation is not
has been set, HHA may sell the land titles to tenants who
have applied for fee simple ownership. HHA is authorized to
lend these tenants up to 90% of the purchase price, and it
may condition final transfer on a right of first refusal for
the first 10 years following sale. §§ 516-30, 516-34, 516-35.
If HHA does not sell the lot to the tenant residing there,
it may lease the lot or sell it to someone else, provided
that public notice has been given. § 516-28. However, HHA
may not sell to any one purchaser, or lease to any one tenant,
more than one lot, and it may not operate for profit. §§ 516-28,
516- 32. In practice, funds to satisfy the condemnation awards
have been supplied entirely by lessees. See App. 164. While
the Act authorizes HHA to issue bonds and appropriate funds
for acquisition, no bonds have issued and HHA has not supplied
any funds for condemned lots. See ibid.
In April 1977,
HHA held a public hearing concerning the proposed acquisition
of some of appellees' lands. HHA made the statutorily required
finding that acquisition of appellees' lands would effectuate
the public purposes of the Act. Then, in October 1978, it
directed appellees to negotiate with certain lessees concerning
the sale of the designated properties. Those negotiations
failed, and HHA subsequently ordered appellees to submit to
comply with the compulsory arbitration order, appellees filed
suit, in February 1979, in United States District
Court, asking that the Act be declared
unconstitutional and that its enforcement be enjoined. The
District Court temporarily restrained the State from proceeding
against appellees' estates. Three months later, while declaring
the compulsory arbitration and compensation formulae provisions
of the Act unconstitutional, [FN3] the District Court refused
preliminarily to enjoin appellants from conducting the statutory
designation and condemnation proceedings. Finally, in December
1979, it granted partial summary judgment to appellants, holding
the remaining portion of the Act constitutional under the
Public Use Clause. See 483 F.Supp. 62 (Haw.1979). The District
Court found that the Act's goals were within the bounds of
the State's police powers and that the means the legislature
had chosen to serve those goals were not arbitrary, capricious,
or selected in bad faith.
FN3. As originally
enacted, lessor and lessee had to commence compulsory arbitration
if they could not agree on a price for the fee simple title.
Statutory formulae were provided for the determination of
compensation. The District Court declared both the compulsory
arbitration provision and the compensation formulae unconstitutional.
No appeal was taken from these rulings, and the Hawaii Legislature
subsequently amended the statute to provide only for mandatory
negotiation and for advisory compensation formulae. These
issues are not before us.
Court of Appeals for the Ninth Circuit reversed. 702 F.2d
788 (CA9 1983). First, the Court of Appeals decided that the
District Court had permissibly chosen not to abstain from
the exercise of its jurisdiction. Then, the Court of Appeals
determined that the Act could not pass the requisite judicial
scrutiny of the Public Use Clause. It found that the transfers
contemplated by the Act were unlike those of takings previously
held to constitute "public uses" by this Court.
The court further determined that the public purposes offered
by the Hawaii Legislature were not deserving of judicial deference.
The court concluded that the Act was simply "a naked
attempt on the part of the state of Hawaii to take the private
property of A and transfer it to B solely for B's private
use and benefit." Id., at 798. One judge dissented.
On applications of HHA and certain private
appellants who had intervened below, this Court noted probable
U.S. 932, 104 S.Ct. 334, 78 L.Ed.2d 304 (1983). We now reverse.
begin with the question whether the District Court abused
its discretion in not abstaining from the exercise of its
jurisdiction. The appellants have suggested as one alternative
that perhaps abstention was required under the standards announced
in Railroad Comm'n v. Pullman Co., 312 U.S. 496, 61 S.Ct.
643, 85 L.Ed. 971 (1941), and Younger v. Harris, 401 U.S.
37, 91 S.Ct. 746, 27 L.Ed.2d 669 (1971). We do not believe
that abstention was required.
In Railroad Comm'n v.
Pullman Co., supra, this Court held that federal courts should
abstain from decision when difficult and unsettled questions
of state law must be resolved before a substantial federal
constitutional question can be decided. By abstaining in such
cases, federal courts will avoid both unnecessary adjudication
of federal questions and "needless friction with state
policies...." Id., 312 U.S., at 500, 61 S.Ct., at 645.
However, federal courts need not abstain on Pullman grounds
when a state statute is not "fairly subject to an interpretation
which will render unnecessary" adjudication of the federal
constitutional question. See Harman v. Forssenius, 380 U.S.
528, 535, 85 S.Ct. 1177, 1182, 14 L.Ed.2d 50 (1965). Pullman
abstention is limited to uncertain questions of state law
because "[a] bstention from the exercise of federal jurisdiction
is the exception, not the rule." Colorado River Water
Conservation Dist. v. United States, 424 U.S. 800, 813, 96
S.Ct. 1236, 1244, 47 L.Ed.2d 483 (1976).
these cases there is no uncertain question of state law. The
Act unambiguously provides that "[t]he use of the power
... to condemn ... is for a public use and purpose."
Haw.Rev.Stat. § 516-83(a)(12) (1977); see also §§ 516-83(a)(10),
(11), (13). There is no other provision of the Act -- or,
for that matter, of Hawaii law -- which would suggest that
237 § 516-83(a)(12) does not mean
exactly what it says. Since "the naked question, uncomplicated
by [ambiguous language], is whether the Act on its face is
unconstitutional," Wisconsin v. Constantineau, 400 U.S.
433, 439, 91 S.Ct. 507, 511, 27 L.Ed.2d 515 (1971), abstention
from federal jurisdiction is not required.
The dissenting judge in the Court
of Appeals suggested that, perhaps, the state courts could
make resolution of the federal constitutional questions unnecessary
by their construction of the Act. See 702 F.2d, at 811-812.
In the abstract, of course, such possibilities always exist.
But the relevant inquiry is not whether there is a bare, though
unlikely, possibility that state courts might render adjudication
of the federal question unnecessary. Rather, "[w]e have
frequently emphasized that abstention is not to be ordered
unless the statute is of an uncertain nature, and is obviously
susceptible of a limiting construction." Zwickler v.
Koota, 389 U.S. 241, 251, and n. 14, 88 S.Ct. 391, 397, and
n. 14, 19 L.Ed.2d 444 (1967). These statutes are not of an
uncertain nature and have no reasonable limiting construction.
Therefore, Pullman abstention is unnecessary. [FN4]
FN4. The dissenting
judge's suggestion that Pullman abstention was required because
interpretation of the State Constitution may have obviated
resolution of the federal constitutional question is equally
faulty. Hawaii's Constitution has only a parallel requirement
that a taking be for a public use. See Haw. Const., Art. I,
§ 20. The Court has previously determined that abstention
is not required for interpretation of parallel state constitutional
provisions. See Examining Board v. Flores de Otero, 426 U.S.
572, 598, 96 S.Ct. 2264, 2279, 49 L.Ed.2d 65 (1976); see also
Wisconsin v. Constantineau, 400 U.S. 433, 91 S.Ct. 507, 27
L.Ed.2d 515 (1971).
The dissenting judge also suggested
that abstention was required under the standards articulated
in Younger v. Harris, supra. Under Younger-abstention doctrine,
interests of comity and federalism
counsel federal courts to abstain from jurisdiction whenever
federal claims have been or could be presented in ongoing
state judicial proceedings that concern
238 important state interests. See
Middlesex Ethics Committee v. Garden State Bar Assn., 457
U.S. 423, 432-437, 102 S.Ct. 2515, 2521-2524, 73 L.Ed.2d 116
(1982). Younger abstention is required, however, only when
state court proceedings are initiated "before any proceedings
of substance on the merits have taken place in the federal
court." Hicks v. Miranda, 422 U.S. 332, 349, 95 S.Ct.
2281, 2291, 45 L.Ed.2d 223 (1975). In other cases, federal
courts must normally fulfill their duty to adjudicate federal
questions properly brought before them.
these cases state judicial proceedings had not been initiated
at the time proceedings of substance took place in federal
court. Appellees filed their federal court complaint in February
1979, asking for temporary and permanent relief. The District
Court temporarily restrained HHA from proceeding against appellees'
estates. At that time, no state judicial proceedings were
in process. Indeed, in June 1979, when the District Court
granted, in part, appellees' motion for a preliminary injunction,
state court proceedings still had not been initiated. Rather,
HHA filed its first eminent domain lawsuit after the parties
had begun filing motions for summary judgment in the District
Court -- in September 1979. Whether issuance of the February
temporary restraining order was a substantial federal court
action or not, issuance of the June preliminary injunction
certainly was. See Doran v. Salem Inn, Inc., 422 U.S. 922,
929-931, 95 S.Ct. 2561, 2566-2567, 45 L.Ed.2d 648 (1975).
A federal court action in which a preliminary injunction is
granted has proceeded well beyond the "embryonic stage,"
id., at 929, 95 S.Ct., at 2566, and considerations of economy,
equity, and federalism counsel against Younger abstention
at that point.
only extant proceedings at the state level prior to the September
1979 eminent domain lawsuit in state court were HHA's administrative
hearings. But the Act clearly states that these administrative
proceedings are not part of, and are not themselves, a judicial
proceeding, for "mandatory arbitration shall be in advance
of and shall not constitute any part of any action in condemnation
or eminent domain." Haw.Rev.Stat. § 516-51(b) (1976).
Since Younger is not a
bar to federal court action when state
judicial proceedings have not themselves commenced, see Middlesex
County Ethics Committee v. Garden State Bar Assn., supra,
457 U.S., at 433, 102 S.Ct., at 2522; Fair Assessment in Real
Estate Assn., Inc. v. McNary, 454 U.S. 100, 112-113, 102 S.Ct.
177, 184-185, 70 L.Ed.2d 271 (1981), abstention for HHA's
administrative proceedings was not required.
majority of the Court of Appeals next determined that the
Act violates the "public use" requirement of the
Fifth and Fourteenth Amendments. On this argument, however,
we find ourselves in agreement with the dissenting judge in
the Court of Appeals.
The starting point for our analysis
of the Act's constitutionality is the Court's decision in
Berman v. Parker, 348 U.S. 26, 75 S.Ct. 98, 99 L.Ed. 27 (1954).
In Berman, the Court held constitutional the District of Columbia
Redevelopment Act of 1945. That Act provided both for the
comprehensive use of the eminent domain power to redevelop
slum areas and for the possible sale or lease of the condemned
lands to private interests. In discussing whether the takings
authorized by that Act were for a "public use,"
id., at 31, 75 S.Ct., at 101, the Court stated:
deal, in other words, with what traditionally has been known
as the police power. An attempt to define its reach or trace
its outer limits is fruitless, for each case must turn on
its own facts. The definition is essentially the product of
legislative determinations addressed to the purposes of
government, purposes neither abstractly nor historically capable
of complete definition. Subject to specific constitutional
limitations, when the legislature has spoken, the public interest
has been declared in terms well-nigh conclusive. In such cases
the legislature, not the judiciary, is the main guardian of
the public needs to be served by social legislation, whether
it 240 be
Congress legislating concerning the District of Columbia ...
or the States legislating concerning local affairs.... This
principle admits of no exception merely because the power
of eminent domain is involved...." Id., at 32, 75 S.Ct.,
at 102 (citations omitted).
Court explicitly recognized the breadth of the principle it
was announcing, noting:
the object is within the authority of Congress, the right
to realize it through the exercise of eminent domain is clear.
For the power of eminent domain is merely the means to the
end.... Once the object is within the authority of Congress,
the means by which it will be attained is also for Congress
to determine. Here one of the means chosen is the use of private
enterprise for redevelopment of the area. Appellants argue
that this makes the project a taking from one businessman
for the benefit of another businessman. But the means of executing
the project are for Congress and Congress alone to determine,
once the public purpose has been established." Id., at
33, 75 S.Ct., at 102.
"public use" requirement is thus coterminous with
the scope of a sovereign's police powers.
is, of course, a role for courts to play in reviewing a legislature's
judgment of what constitutes a public use, even when the eminent
domain power is equated with the police power. But the Court
in Berman made clear that it is "an extremely narrow"
one. Id., at 32, 75 S.Ct., at 102. The Court in Berman cited
with approval the Court's decision in Old Dominion Co. v.
United States, 269 U.S. 55, 66, 46 S.Ct. 39, 40, 70 L.Ed.
162 (1925), which held that deference to the legislature's
"public use" determination is required "until
it is shown to involve an impossibility." The Berman
Court also cited to United States ex rel. TVA v. Welch, 327
U.S. 546, 552, 66 S.Ct. 715, 718, 90 L.Ed. 843 (1946), which
emphasized that "[a]ny departure from this judicial restraint
would result in courts deciding on what is and is not a governmental
function and in their invalidating legislation on the basis
of their view 241 on that question
at the moment of decision, a practice which has proved impracticable
in other fields." In short, the Court has made clear
that it will not substitute its judgment for a legislature's
judgment as to what constitutes a public use "unless
the use be palpably without reasonable foundation." United
States v. Gettysburg Electric R. Co., 160 U.S. 668, 680, 16
S.Ct. 427, 429, 40 L.Ed. 576 (1896).
be sure, the Court's cases have repeatedly stated that "one
person's property may not be taken for the benefit of another
private person without a justifying public purpose, even though
compensation be paid." Thompson v. Consolidated Gas Corp.,
300 U.S. 55, 80, 57 S.Ct. 364, 376, 81 L.Ed. 510 (1937). See,
e.g., Cincinnati v. Vester, 281 U.S. 439, 447, 50 S.Ct. 360,
362, 74 L.Ed. 950 (1930); Madisonville Traction Co. v. St.
Bernard Mining Co., 196 U.S. 239, 251‑252, 25 S.Ct.
251, 255‑256, 49 L.Ed. 462 (1905); Fallbrook Irrigation
District v. Bradley, 164 U.S. 112, 159, 17 S.Ct. 56, 63, 41
L.Ed. 369 (1896). Thus, in Missouri Pacific R. Co. v. Nebraska,
164 U.S. 403, 17 S.Ct. 130, 41 L.Ed. 489 (1896), where the
"order in question was not, and was not claimed to be,
... a taking of private property for a public use under the
right of eminent domain," id., at 416, at 135 (emphasis
added), the Court invalidated a compensated taking of property
for lack of a justifying public purpose. But where the exercise
of the eminent domain power is rationally related to a conceivable
public purpose, the Court has never held a compensated taking
to be proscribed by the Public Use Clause. See Berman v. Parker,
supra; Rindge Co. v. Los Angeles, 262 U.S. 700, 43 S.Ct. 689,
67 L.Ed. 1186 (1923); Block v. Hirsh, 256 U.S. 135, 41 S.Ct.
458, 65 L.Ed. 865 (1921); cf. Thompson v. Consolidated Gas
Corp., supra (invalidating an uncompensated taking).
On this basis, we have no trouble
concluding that the Hawaii Act is constitutional. The people
of Hawaii have attempted, much as the settlers of the original
13 Colonies did, [FN5] to reduce the perceived social and
economic evils of a
242 land oligopoly traceable to
their monarchs. The land oligopoly has, according to the Hawaii
Legislature, created artificial deterrents to the normal functioning
of the State's residential land market and forced thousands
of individual homeowners to lease, rather than buy, the land
underneath their homes. Regulating oligopoly and the evils
associated with it is a classic exercise of a State's police
powers. See Exxon Corp. v. Governor of Maryland, 437 U.S.
117, 98 S.Ct. 2207, 57 L.Ed.2d 91 (1978); Block v. Hirsh,
supra; see also People of Puerto Rico v. Eastern Sugar Associates,
156 F.2d 316 (CA1), cert. denied, 329 U.S. 772, 67 S.Ct. 190,
91 L.Ed. 664 (1946). We cannot disapprove of Hawaii's exercise
of this power.
After the American Revolution, the colonists in several States
took steps to eradicate the feudal incidents with which large
proprietors had encumbered land in the Colonies. See, e.g.,
Act of May 1779, 10 Henning's Statutes At Large 64, ch. 13,
§ 6 (1822) (Virginia statute); Divesting Act of 1779, 1775-1781
Pa. Acts 258, ch. 139 (1782) (Pennsylvania statute). Courts
have never doubted that such statutes served a public purpose.
See, e.g., Wilson v. Iseminger, 185 U.S. 55, 60-61, 22 S.Ct.
573, 574-575, 46 L.Ed. 804 (1902); Stewart v. Gorter, 70 Md.
242, 244-245, 16 A. 644, 645 (1889).
can we condemn as irrational the Act's approach to correcting
the land oligopoly problem. The Act presumes that when a sufficiently
large number of persons declare that they are willing but
unable to buy lots at fair prices the land market is malfunctioning.
When such a malfunction is signalled, the Act authorizes HHA
to condemn lots in the relevant tract. The Act limits the
number of lots any one tenant can purchase and authorizes
HHA to use public funds to ensure that the market dilution
goals will be achieved. This is a comprehensive and rational
approach to identifying and correcting market failure.
Of course, this Act, like any
other, may not be successful in achieving its intended goals.
But "whether in fact the provision will accomplish its
objectives is not the question: the [constitutional requirement]
is satisfied if ... the ... [state] Legislature rationally
could have believed that the [Act] would promote its objective."
Western & Southern Life Ins. Co. v. State Bd. of Equalization,
451 U.S. 648, 671-672, 101 S.Ct. 2070, 2084-2085, 68 L.Ed.2d
514 (1981); see also Minnesota v. Clover Leaf Creamery Co.,
449 U.S. 456, 466, 101 S.Ct. 715, 725, 66 L.Ed.2d 659 (1981);
Vance v. Bradley, 440 U.S. 93, 112, 99 S.Ct. 939, 950, 59
L.Ed.2d 171 (1979). When the legislature's purpose is legitimate
and its 243
means are not irrational, our cases make clear that empirical
debates over the wisdom of takings -- no less than debates
over the wisdom of other kinds of socioeconomic legislation
-- are not to be carried out in the federal courts. Redistribution
of fees simple to correct deficiencies in the market determined
by the state legislature to be attributable to land oligopoly
is a rational exercise of the eminent domain power. Therefore,
the Hawaii statute must pass the scrutiny of the Public Use
We similarly find no merit in appellees' Due Process and Contract
Clause arguments. The argument that due process prohibits
allowing lessees to initiate the taking process was essentially
rejected by this Court in New Motor Vehicle Board v. Fox Co.,
439 U.S. 96, 108-109, 99 S.Ct. 403, 411-412, 58 L.Ed.2d 361
(1978). Similarly, the Contract Clause has never been thought
to protect against the exercise of the power of eminent domain.
See United States Trust Co. v. New Jersey, 431 U.S. 1, 19,
and n. 16, 97 S.Ct. 1505, 1516, and n. 16, 52 L.Ed.2d 92 (1977).
of Appeals read our cases to stand for a much narrower proposition.
First, it read our "public use" cases, especially
Berman, as requiring that government possess and use property
at some point during a taking. Since Hawaiian lessees retain
possession of the property for private use throughout the
condemnation process, the court found that the Act exacted
takings for private use. 702 F.2d, at 796-797. Second, it
determined that these cases involved only "the review
of ... congressional determination[s] that there was a public
use, not the review of ... state legislative determination[s]."
Id., at 798 (emphasis in original). Because state legislative
determinations are involved in the instant cases, the Court
of Appeals decided that more rigorous judicial scrutiny of
the public use determinations was appropriate. The court concluded
that the Hawaii Legislature's professed purposes were mere
"statutory rationalizations." Ibid. We disagree
with the Court of Appeals' analysis.
The mere fact that property taken
outright by eminent domain is transferred in the first instance
to private beneficiaries does not condemn that taking as having
only a private 244
purpose. The Court long ago rejected
any literal requirement that condemned property be put into
use for the general public. "It is not essential that
the entire community, nor even any considerable portion, ...
directly enjoy or participate in any improvement in order
[for it] to constitute a public use." Rindge Co. v. Los
Angeles, 262 U.S., at 707, 43 S.Ct., at 692. "[W]hat
in its immediate aspect [is] only a private transaction may
... be raised by its class or character to a public affair."
Block v. Hirsh, 256 U.S., at 155, 41 S.Ct., at 459. As the
unique way titles were held in Hawaii skewed the land market,
exercise of the power of eminent domain was justified. The
Act advances its purposes without the State's taking actual
possession of the land. In such cases, government does not
itself have to use property to legitimate the taking; it is
only the taking's purpose, and not its mechanics, that must
pass scrutiny under the Public Use Clause.
Similarly, the fact that
a state legislature, and not the Congress, made the public
use determination does not mean that judicial deference is
less appropriate. [FN7] Judicial deference is required because,
in our system of government, legislatures are better able
to assess what public purposes should be advanced by an exercise
of the taking power. State legislatures are as capable as
Congress of making such determinations within their respective
spheres of authority. See Berman v. Parker, 348 U.S., at 32,
75 S.Ct., at 102. Thus, if a legislature, state or federal,
determines there are substantial reasons for an exercise of
the taking power, courts must defer to its determination that
the taking will serve a public use.
It is worth noting that the Fourteenth Amendment does not
itself contain an independent "public use" requirement.
Rather, that requirement is made binding on the States only
by incorporation of the Fifth Amendment's Eminent Domain Clause
through the Fourteenth Amendment's Due Process Clause. See
Chicago, B. & Q.R. Co. v. Chicago, 166 U.S. 226, 17 S.Ct.
581, 41 L.Ed. 979 (1897). It would be ironic to find that
state legislation is subject to greater scrutiny under the
incorporated "public use" requirement than is congressional
legislation under the express mandate of the Fifth Amendment.
of Hawaii has never denied that the Constitution forbids even
a compensated taking of property when executed for no reason
other than to confer a private benefit on a particular private
party. A purely private taking could not withstand the scrutiny
of the public use requirement; it would serve no legitimate
purpose of government and would thus be void. But no purely
private taking is involved in these cases. The Hawaii Legislature
enacted its Land Reform Act not to benefit a particular class
of identifiable individuals but to attack certain perceived
evils of concentrated property ownership in Hawaii -- a legitimate
public purpose. Use of the condemnation power to achieve this
purpose is not
irrational. Since we assume for purposes of these appeals
that the weighty demand of just compensation has been met,
the requirements of the Fifth and Fourteenth Amendments have
been satisfied. Accordingly, we reverse the judgment of the
Court of Appeals, and remand these cases for further proceedings
in conformity with this opinion.
is so ordered.
MARSHALL took no part in the consideration or decision of