 |
Definition of 'Eminent Domain'
The power the government has to obtain the property of an individual even without the person's full consent. In most countries, including the U.S., the land owner will be compensated for the land at fair market value. This power allows the government to seize land to be used in public enterprises such as roads, schools, or utilities installations. Eminent domain is generally found in some form in most common law nations.
Also known as "compulsory purchase" (U.K, New Zealand and Ireland), "expropriation" (Canada) and "compulsory acquisition" (Australia).
|
 |
Investopedia explains 'Eminent Domain'
In the United States, eminent domain is a right granted under the Fifth Amendment of the Constitution. If real estate property is being seized, fair market value must take into account prices in the surrounding area, and payment must be made promptly. Eminent domain laws are frequently contested in the courts, as there have been cases of property being seized only to have a private business set up shop on the grounds, which goes against the intention of the power.
|