Property bought would be then re-sold to developers at a profit - or, if they choose, at a reduced price so the developers make even more money.

Legal authorities describe as "quite remarkable" a section of new planning laws flagged by the Minister for Planning, Frank Sartor, to acquire land by force to onsell to private developers.

"A man's home may no longer be his castle, but it could well end up being somebody else's castle," said Anthony Whealy, a planning expert with Gadens Lawyers. "It will certainly be welcome news to many in the development game.

"Under the current law, the minister is not able to re-sell land which has been acquired or transfer it to another person. The new scheme expressly allows that, and makes it clear that it may be done as part of a profitable proposal by a private developer."

Mr Sartor insists the law will only be used to ensure developments for the greater public benefit cannot be blocked, but the Greens - who have helped to expose the extent of developers' donations to the Labor Party - say it could invite corruption.

"Given the whole stench surrounding developer donations, it lends added weight to the view that this Government is introducing the most developer-friendly laws ever seen in this state," the Greens MP Sylvia Hale said.

A similar US state law to transfer land from one private owner to another for an urban renewal plan in New London, Connecticut, caused national uproar several years ago. In 2005, the US Supreme Court upheld the law by the narrowest of margins but it was widely criticised as a gross violation of property rights and 42 states passed laws to limit the impact of the court's decision.

A provision in the draft bill released by Mr Sartor last week arises from similar circumstances. Last year Parramatta City Council sought to compulsorily acquire three properties, with Mr Sartor's approval, to allow its $1.4 billion Civic Place redevelopment. The land would have ended up in the ownership of the developer Grocon.

The Land and Environment Court upheld an appeal by the two owners against the acquisition. Now the minister wants to override that ruling and give himself the power to acquire land to transfer to another private owner, and to delegate such power to councils and state agencies such as Landcom, for the purposes of urban renewal and land releases.

The power would extend to land that "adjoins or lies in the vicinity of" such projects. It could be sold "whether for profit or otherwise" with the only constraint being that in the opinion of the designated authority there is a "net public benefit". But Gadens says this is not defined anywhere on the legal statutes. "Inevitably this will lead to a purely subjective determination of whether a proposal amounts to a net public benefit," Mr Whealy said.

Alex Davidson, who owns land suitable for subdivision on Sydney's outskirts at Glenorie, is fearful of the proposed law.

"That provision, if enacted, will end any pretence that owners actually 'own' land in NSW. It will enable the Government to force a landowner to sell … then sell, perhaps cheaply, to a favoured son waiting in the wings," Mr Davidson said. "It is an absolutely unacceptable elevation of state power over private property rights and will greatly exacerbate the potential for corruption. It is an abuse of power for the Government, when faced with being unable to get their way because the judge upheld ownership rights, to simply change the law so they win next time."

Mr Sartor's spokeswoman said it followed two court cases that might have frustrated good planning. The first concerned Parramatta's "award-winning" Civic Place project.

"In the second, City of Sydney Council's existing provision that removes cars from Pitt Street Mall may have been jeopardised through the inability to acquire an adjacent easement to allow vehicle movements into a proposed development site."

The ability to compulsorily acquire land for "important public outcomes" had been a longstanding, accepted practice for Government.

"It is also established practice to offer for sale any residual land which may be left over after the completion of a project, such as a new road or railway line.

"Importantly, the acquisition of land for such purposes would only be authorised after all other avenues have failed and after appropriate public exhibition and consideration."

Anyone could challenge any determination by the minister or the acquiring authority, including on the issue of net public benefit, in court.