Need Help With Question(Applied Business Law)?

Sam owns an acre of land on Red River. The government dams the river. A lake forms behind the dam, covering Sam's land. Does the government owe Sam anything?

If so, what? If not, why?


Yes, The Takings Clause of the Fifth Amendment of the US Constitution has been held to require "just compensation" for the taking of private property by the government, typically measured as "the market value of the property at the time of the taking".

For example, if Sam's land was worth $1,000 at the time of the flooding, then the g'ment would owe $1,000, assuming there was no further value to having the land (other than an historic deed showing he owns some underwater real estate). However, if Sam's land was worth $200,000 the day before the government announced the dam project, that raises an interesting question of when the "taking" actually occurred. There are sometimes "speculators" who buy land "in the way", hoping to make a buck by selling out early.

Agencies often play another game: Propose a new development, condemn the properties in the way, and only THEN take the properties, paying only the condemned value.


Why would the government owe Sam anything? They gave him a lake! He should be paying them for getting a new lake, not the other way around. Have you ever gotten an estimate to have a lake put on your property? Those things are not cheap.