The Fifth Amendment protects a number of rights, including a prohibition on government taking property without paying for it. Plain and simple, the amendment says, “nor shall private property be taken for public use, without just compensation.” It’s the Pottery Barn rule for government: “You break it, you bought it.”
But a small town in Oklahoma thinks it has found a loophole. Melisa Robinson bought a small mobile home community in tiny Okay, about an hour outside Tulsa. It was in poor shape when she and her husband bought it, but they put in the work to make it a good place to live. It is now a safe, clean, and family friendly community.
When the Okay Water Authority started making much needed upgrades to the sewer system, Melisa let the construction company store some equipment and supplies on a corner of her property. That kindness was not repaid.
Instead, one morning Melisa found the property in disarray. Workers had installed a new sewer line running along the back of her property—and they had replaced another sewer line that runs right up the middle of her property and connects to the mobile homes. The Okay Water Authority had no authorization or permission to dig up Melisa’s property. In fact, they hadn’t even told her about its plans; she thought they were going to replace a sewer line on her neighbor’s property, where it did have an easement.
On top of the mess, the work was poorly performed. The new lines running to the mobile homes were badly graded and sewage was backing up. The digging also clipped underground power lines and appliances in the homes shorted out.
Despite the poor work done on her private property, Okay dragged its feet on paying to fix the damage. Melisa could not wait to make the mobile homes livable again, so she used her own funds for the repairs. When she sent the town a bill, it continued refusing to pay.
Melisa then took the town to court, filing an “inverse condemnation” suit. Basically, inverse condemnation works like eminent domain but when the government hasn’t gotten permission first.
After years of litigation, a jury eventually sided with Melisa, awarding her more than $73,000 in compensation. A state appeals court reversed the decision, but Melisa appealed to the Oklahoma Supreme Court, which ruled in her favor.
But then something Kafkaesque happened. The Okay Water Authority said that it had no money to pay Melisa. The town had structured the authority so that it was penniless on paper, no cash accounts and no assets. For the last two years, Melisa has been trying to get what she is owed. But town officials continue to funnel money away from the authority and into the town’s coffers.
Fed up, Melisa filed a federal lawsuit with the Institute for Justice (IJ). She’s asking for the federal courts to hold that Okay cannot play shell games, it must pay her with money.
There’s a long history of government trying to escape its obligation to pay for what is takes. One of the important reforms of Magna Carta was demanding that the king pay with money. Before the charter, English kings would try to delay payments by giving out “tally sticks.” The IOUs were worthless in practice. So Magna Carta barred the crown from taking “without immediately tendering money therefor.”
This is the root of the Fifth Amendment’s takings clause. But even in America, the government has occasionally tried to play games to get out of its obligations. Recently, the Louisiana Supreme Court said that the state could not escape paying by simply refusing to appropriate money after a judgment. Floridians fought for years to get their payments after government programs that took citrus trees to fight a blight.
Melisa’s case also has echoes of a case that IJ just won at the U.S. Supreme Court. In Devillier v. Texas, highway construction effectively turned ranchland near Houston into retention ponds. The state tried a crafty legal strategy to claim immunity from the ranchers’ lawsuit.
Under the pressure of oral argument, the Texas’s attorney admitted that the ranchers’ case could go forward in state court (an argument the state had not made in its written briefs). Because of that admission, the Court decided not to rule on the legal question before it but gave the ranchers what they wanted: a path forward to getting paid.
The Constitution is simple and courts need to reject shell games and complicated legal strategies that get the government out of its debts. Melisa is now owed more than $200,000 in compensation and fees and the more the town fights, the more it is likely to owe in the end. For Okay, following the Constitution would have been the right, and the smart thing, to do.