What is the term used to describe the right of a government to take private property for public use upon payment of its fair market value?

The term that describes the right of a government to take private property for public use, accompanied by payment of its fair market value, is eminent domain. This legal principle enables governments to acquire private land for purposes such as building roads, schools, or other infrastructure deemed beneficial for the public good.

Eminent domain is grounded in the understanding that while individuals have property rights, those rights can be overridden when necessary for the greater benefit of society, as long as property owners receive just compensation. This compensation is typically equivalent to the fair market value of the property at the time of the taking.

In contrast, encroachment involves a situation where a property owner unlawfully extends their property line onto a neighboring property. Equity refers to the concept of fairness in legal matters, often relating to the justice of outcomes rather than specifically property rights. Escrow involves a financial arrangement in which a third party temporarily holds funds or assets until specific conditions are met, and does not relate to property acquisition. Thus, eminent domain accurately captures the legal concept at hand in this scenario.