Inverse condemnation

Inverse condemnation is a term used in the law to describe a situation in which the government takes private property but fails to pay the compensation required by the 5th Amendment of the Constitution, so the property's owner has to sue to obtain the required just compensation. In some states the term also includes damaging of property as well as its taking. In inverse condemnation cases the owner is the plaintiff and that is why the action is called inverse – -- the order of parties is reversed, as compared to the usual procedure in direct condemnation where the government is the plaintiff who sues a defendant-owner to take his or her property.

The taking can be physical (e.g., land seizure, flooding, retention of possession after a lease to the government expires, deprivation of access, removal of ground support) or it can be a regulatory taking (when regulations are so onerous that they make the regulated property unusable by its owner for any reasonable or economically viable purpose). The latter is the most controversial form of inverse condemnation. It can occur when the regulation of the property's use is so severe that it goes "too far," as Justice Holmes put it in Pennsylvania Coal Co. v. Mahon, 260 U.S. 393 (1922), and deprives the owner of the property's value, utility or marketability, denying him or her the benefits of property ownership thus accomplishing a constitutionally forbidden de facto taking without compensation.

The Supreme Court of the United States has not elaborated on what "too far" is, and the doctrinal basis for its jurisprudence has been widely criticized as confused and inconsistent. But the court has articulated three situations in which inverse condemnation occurs. These are (a) physical seizure or occupation, (b) the reduction of the regulated property's utility or value to such an extent that it is no longer capable of economically viable use, and (c) where as a precondition to the issuance of a building permit, the government demands that the regulated owner convey property to the government even though there is no rational nexus between the owner's activity's impact on public resources and the owner's proposed regulated use, or where the extent of the exaction is not proportional to the effect of the owner's activities (Nollan v. California Coastal Commission and Dolan v. City of Tigard).

...
Wikipedia