UNITED STATES SUPREME COURT DECISIONS ON-LINE

To reduce the perceived social and economic evils of a land oligopoly traceable to the early high chiefs of the Hawaiian Islands, the Hawaii Legislature enacted the Land Reform Act of 1967 (Act), which created a land condemnation scheme whereby title in real property is taken from lessors and transferred to lessees in order to reduce the concentration of land ownership. Under the Act, lessees living on single-family residential lots within tracts at least five acres in size are entitled to ask appellant Hawaii Housing Authority (HHA) to condemn the property on which they live. When appropriate applications by lessees are filed, the Act authorizes HHA to hold a public hearing to determine whether the State's acquisition of the tract will "effectuate the public purposes" of the Act. If HHA determines that these public purposes will be served, it is authorized to designate some or all of the lots in the tract for acquisition. It then acquires, at prices set by a condemnation trial or by negotiation between lessors and lessees, the former fee owners' "right, title, and interest" in the land, and may then sell the land titles to the applicant lessees. After HHA had held a public hearing on the proposed acquisition of appellees' lands and had found that such acquisition would effectuate the Act's public purposes, it directed appellees to negotiate with certain lessees concerning the sale of the designated properties. When these negotiations failed, HHA ordered appellees to submit to compulsory arbitration as provided by the Act. Rather than comply with this order, appellees filed suit in Federal District Court, asking that the Act be declared unconstitutional and that its enforcement be enjoined. The court temporarily restrained the State from proceeding against appellees' estates, but subsequently, while holding the compulsory arbitration and compensation formulae provisions of the Act unconstitutional, refused to issue a preliminary injunction and ultimately granted partial summary judgment to HHA and private appellants who had intervened, holding clubjuris

Page 467 U. S. 230

the remainder of the Act constitutional under the Public Use Clause of the Fifth Amendment, made applicable to the States under the Fourteenth Amendment. After deciding that the District Court had properly not abstained from exercising its jurisdiction, the Court of Appeals reversed, holding that the Act violates the "public use" requirement of the Fifth Amendment.

Held:

1. The District Court was not required to abstain from exercising its jurisdiction. Pp. 467 U. S. 236-239.

(a) Abstention under Railroad Comm'n v. Pullman Co., 312 U. S. 496, is unnecessary. Pullman abstention is limited to uncertain questions of state law, and here there is no uncertain question of state law, since the Act unambiguously provides that the power to condemn is "for a public use and purpose." Thus, the question, uncomplicated by ambiguous language, is whether the Act, on its face, is unconstitutional. Pp. 467 U. S. 236-237.

(b) Nor is abstention required under Younger v. Harris, 401 U. S. 37. Younger abstention is required only when state court proceedings are initiated before any proceedings of substance on the merits have occurred in federal court. Here, state judicial proceedings had not been initiated at the time proceedings of substance took place in the District Court, the District Court having issued a preliminary injunction before HHA filed its first state eminent domain suit in state court. And the fact that HHA's administrative proceedings occurred before the federal suit was filed did not require abstention, since the Act clearly states that those proceedings are not part of, or are not themselves, a judicial proceeding. Pp. 467 U. S. 237-239.

2. The Act does not violate the "public use" requirement of the Fifth Amendment. Pp. 467 U. S. 239-244.

(a) That requirement is coterminous with the scope of a sovereign's police powers. This Court will not substitute its judgment for a legislature's judgment as to what constitutes "public use" unless the use is palpably without reasonable foundation. Where the exercise of the eminent domain power is rationally related to a conceivable public purpose, a compensated taking is not prohibited by the Public Use Clause. Here, regulating oligopoly and the evils associated with it is a classic exercise of a State's police powers, and redistribution of fees simple to reduce such evils is a rational exercise of the eminent domain power. Pp. 467 U. S. 239-243.

(b) The mere fact that property taken outright by eminent domain is transferred in the first instance to private beneficiaries does not condemn that taking as having only a private purpose. Government does not itself have to use property to legitimate the taking; it is only the taking's purpose, and not its mechanics, that must pass scrutiny under clubjuris

Page 467 U. S. 231

the Public Use Clause. And the fact that a state legislature, and not Congress, made the public use determination does not mean that judicial deference is less appropriate. Pp. 467 U. S. 243-244.

702 F.2d 788, reversed and remanded.

O'CONNOR, J., delivered the opinion of the Court, in which all other Members joined, except MARSHALL, J., who took no part in the consideration or decision of the cases.