Hawaii Housing Authority v. Midkiff

467 U.S. 229 (1984)

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Nature of the Case

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Facts

Hawaii was originally conquered by the U.S. This created a problem in that the feudal land system that was present was hard to end. Even by the mid-1960s, 49% of the land was owned by the State, and Federal Government and 47% was owned by just 72 private landowners. The State legislature concluded, and rightfully so, 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. The State of Hawaii's Housing Authority (D) enacted the Land Reform Act in 1967. This created a procedure for condemning residential tracts and transferring ownership to existing lessees. The purpose of the Act was to make land sales involuntary, thereby making federal tax consequences less severe, which was a complaint of the landowners, while still facilitating the redistributions of fee simples. D had a procedure to transfer ownership whereby those living in tracts of at least five acres and at least 25 eligible tenants or half of the lots in a tract applied to condemn the lots, and the process would begin. A public hearing was then held to determine which tracts should or should not be taken and sold and then the prices were set by a condemnation trial or by negotiation between the owner and the lessees. In April 1977, a hearing was held for Midkiff’s (P) land. Negotiations over the sale were not successful, and D ordered compulsory arbitration. P and other fee holders refused to comply and sued, claiming that the statute violated the Fifth Amendment. The trial court issued a TRO and then three months later declared the compulsory arbitration and compensation formulae unconstitutional but refused to enjoin D from conducting the statutory designation and condemnation proceedings. In December 1979, it finally granted a partial summary judgment to D declaring that the rest of the Act was constitutional. The Court of Appeals reversed; the transfers under this Act are unlike any we have ever seen that have been previously held to constitute public uses. The appeals court also found that the public purpose of the Act was not deserving of judicial deference and that the act was simply a naked attempt to take private property and transfer it to others for private use. The majority of the Court of Appeals determined that the Act violates the 'public use' requirement of the Fifth and Fourteenth Amendments. D petitioned the Supreme Court for a writ of certiorari, claiming that the statute was reasonably related to a legitimate purpose, and was therefore constitutional.