Eminent Domain Report

When a public agency acquires property for a public project, property owners have a constitutional right to receive just compensation. But what about the businesses that operate on the property – are they entitled to anything? 

The rights of business owners vary from state to state, as there is not a constitutional right to compensation for business losses. In California, business owners may be entitled to compensation for several items. These include:

• Loss of Business Goodwill: A business may accrue “goodwill” because of its location, reputation and ability to attract and ...

Join me and my colleague Liz Klebaner on November 22, 2024 as we present “Environmental Considerations for Right of Way Acquisition: Identifying and Tackling Pre-Acquisition and Post EIR/S Issues” during the IRWA Region 1 Fall Conference and Networking Round-Up 2024. … 

In 1831, the colony of Gonzales requested a cannon for defense that was granted by the Mexican authorities. This cannon was a Spanish made bronze six-pounder. The grant had one condition; the cannon had to be returned when asked. By 1835, the political climate had changed in the area and Mexico had asked the Texians to return the cannon. The Texians response: “Come and Take It”. This led to a Mexican military response against the Texians with the colonists producing a flag of a white field with stitching of a black star, a cannon and the words: COME AND TAKE IT. The Texians faced off ...

Join me on January 24, 2025, as I participate in the “Masters of Trial” panel during CLE International’s 27th Annual California Eminent Domain Conference in Irvine, CA. Our panel will discuss effective direct and cross examination of appraisers and other experts.

CLE International’s California Eminent Domain Conference provides the opportunity to network with attorneys, appraisers, agency representatives, right of way professionals and others from around the state, while you hear all points of view on the most important and timely condemnation issues. I hope to see ...

Investors and developers scour the Southern California real estate market searching for opportunities to buy dated houses that they can demolish and replace with large, modern homes to sell for much more.  A few individuals likely thought they struck gold after inheriting a small bungalow cottage in Coronado, California with panoramic views of the Bay and golf course nearby. The cottage, built in 1924, was the smallest house on the street with the least-utilized lot; it represented both a great opportunity and a bygone era. These soon-to-be developers turned inverse condemnation ...

We’ve reported in the past that public agencies are more frequently demanding certain off-site public improvements to accommodate proposed private developments as a condition of entitlement approval.  These can range from street widenings to accommodate additional traffic, pump stations for additional water capacity, or flood improvements to address drainage or run-off concerns.  Additionally, a new condition facing California developers is dedicating or acquiring open space to mitigate wildfire risk.    

Recently, the owner of a mixed-use development project in San Diego ...

The regulations implementing the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970 (the Uniform Act or Act) have not been amended since 2005. In 2019, the U.S. Department of Transportation promulgated proposed regulations. After extensive comment, the final rule was passed and circulated on May 3, 2024. It went into effect on June 3, 2024. This article summarizes some of the major changes to the Uniform Act. … 

When a property owner brings a regulatory taking / inverse condemnation claim based on a city or county’s zoning decisions, the owner often provides context and history, including public statements made by staff, board members or city council members.  Are those public statements protected speech and therefore subject to California’s Anti-SLAPP statute?  A recent California Court of Appeal decision, City of Redondo Beach v. 9300 Wilshire, provides some context on what is and what is not permissible.  … 

Despite California’s record high levels of precipitation in 2023, water scarcity remains a pressing issue. Governments have turned to using the power of eminent domain to acquire investor-owned utilities in an effort to improve water service and costs for their communities. This complex process, known as municipalization, contains significant legal hurdles for governments because investor-owned utilities are uniquely empowered to challenge such takeovers.

In Nossaman’s California Water Views – 2024 Outlook, we explore the legal framework of condemnation actions ...

Jillian Friess Leivas recently represented IRWA Chapter 67 (Orange County) at the 2024 Region 1 Spring Forum in Las Vegas, Nevada as the Chapter’s President-Elect and International Director. IRWA Region 1 encompasses all chapters within California, Nevada and Arizona.

During the forum, Jillian was awarded the IRWA Region 1 Young Professional of the Year Award. The award recognizes association members who have demonstrated a commitment to the industry at the Chapter, Region and/or International level of the association in terms of participation, contribution and service ...

The regulations in 49 CFR Part 24 implementing 42 USC Ch. 61, generally known as the “Uniform Act,” are being updated for the first time since 2005. New regulations are set to take effect on June 3, 2024 (the “Rule”). We will be discussing specific aspects of the new Rule in future posts. Please contact us with any specific questions in the meantime. 

In general, the new Rule provides that caps on certain benefits, limits on waiver valuations and conflict of interest have increased. Cost of living adjustment will be allowed to increase maximum waiver and benefit levels over time ...

Aleene Madikians and I recently authored the article “Mitigating Damages—Condemning Replacement or Substitute Property” for the May/June 2024 issue of the International Right of Way Association (IRWA) newsletter, Right of Way. In the article we discuss, among other topics, severance damages from 'partial takings'. … 

Dodge, duck, dip, dive and… dodge. An interesting case from the United States Supreme Court yesterday. Interesting because of what it says, and interesting because of what it very explicitly declined to say.

The question presented in DeVillier v. Texas, 601 U.S. ___ (2024) was whether the Takings Clause of the Fifth Amendment was “self-executing”. That is, whether a landowner could sue a State for money directly under the Takings Clause, even if there is no statute specifically creating a cause of action (and where the closest statute very expressly does not provide a remedy ...

With its expansion into Texas, Nossaman is enjoying more opportunities to assist public entities with large and significant public works projects.  These projects will help to shape the infrastructure being developed and integrated throughout the United States.  The recent addition of two partners with vast experience in eminent domain law, particularly as applied in the Lone Star State, will fortify Nossaman’s efforts to assist clients with their projects so that they progress seamlessly from start to finish. …

On April 12, 2024, in Sheetz v. County of El Dorado, the U.S. Supreme Court unanimously overruled more than two decades of California precedent, holding that legislatively established development impact fee programs must have an essential nexus and a rough proportionality to the impacts from the proposed development project on which they are being applied. The full ramifications of this ruling are still yet to be decided, however, as the Supreme Court left open the possibility of applying the nexus/proportionality tests in a more deferential manner when the development impact ...

Most private development projects in California trigger some sort of discretionary public approval, whether it be environmental review, zone changes, permits, or other forms of entitlement approvals.  As part of that approval process, public agencies are more frequently demanding certain off-site public improvements to accommodate the proposed private development.  Such improvements could include, for example, street widenings to accommodate additional traffic, pump stations for additional water capacity, or flood improvements to address drainage or run-off concerns.  ...

Procedures governing eminent domain actions differ in some respects from other areas of law. Notably, all issues, except the sole issue of compensation, are adjudicated by the court. This requires the court to decide issues of law before the jury can determine compensation, complicating timing issues even where civil code sections on the matter seem straightforward.

Pursuant to California Code of Civil Procedure § 583.310, “An action shall be brought to trial within five years after the action is commenced against the defendant.” Absent a written stipulation, oral agreement ...

It is spring.  Flowers are blooming; the rivers swell with snowmelt from the mountains; newly thawed Northern ponds welcome the return of their ducks and geese; Florida convulses with an annual migration of revelers.  It is only natural for the mind to turn to one of the two inevitabilities: Taxes.   

Tax time

As the Ides of April approach for individual tax filers, a mad dash to find tax savings is underway.  Many real estate investors and professionals are quite familiar with the tax saving potential of a 1031 Exchange.  Named after a section number of the tax code at 26 U.S.C. § 1031—which ...

The Arizona Court of Appeals recently held that members of a homeowners’ association are not entitled to severance damages to their residential parcels when common areas are condemned.

Property owners in Arizona eminent domain actions are entitled to just compensation. Just compensation includes (1) “the value of the property sought to be condemned” and (2) “[i]f the property sought to be condemned constitutes only a part of a larger parcel, the damages that will accrue to the portion not sought to be condemned by reason of its severance from the portion sought to be ...

A public agency’s acquisition of private property can sometimes trigger significant severance damages due to eliminating access, cutting off utility service, or taking a substantial portion of a property’s parking.  As agencies look to get more creative in minimizing exposure to large damages claims, they will sometimes offer up mitigation alternatives, such as providing an alternative access, or new utility service, or replacement parking, with such rights being granted from an adjacent or neighboring property.  These mitigation solutions are often a win-win for ...

When one hears “eminent domain” or “condemnation,” you might envision a governmental agency or utility coming in and acquiring the entirety of a piece of property and leaving nothing behind.  However, often times, condemnation does not require the entire property, but only a portion or rights to use a portion a specific way. So, what is the difference between the various terms of fee simple, an easement, full take, and part take? … 

Join us in Riverside, CA on February 7th as we provide an overview of the eminent domain process, along with best practices for right-of-way acquisition, during the International Right of Way Association (IRWA) Chapter 57 Membership Luncheon. We’ll cover everything from identifying project alternatives to ultimately acquiring specific property.

We will provide an overview of the entire process and illustrate how all of the individual components work together. In particular, we’ll discuss how to effectively navigate the precondemnation process to position for the ...

In California, a fundamental principle of eminent domain law is that an owner of property acquired by eminent domain is entitled to just compensation for the property interests taken (Code Civ. Proc. §1263.010). 

However, what if the acquisition for the public project involves only a portion of the owner’s property interests? This question arises quite often when a portion of an owner’s property is acquired for street or freeway widenings, grade separation projects, expansion of property already dedicated to an existing public use, as well as many other types of public ...

We’ve been closely watching the Sheetz v. County of El Dorado case, which has worked its way up through the California trial and appellate courts all the way to the U.S. Supreme Court. For a quick refresher, the case concerns whether legislatively enacted development impact fees (such as fees for building permits, etc.) are subject to the rough proportionality and nexus requirements (i.e., can a generally enacted permit fee be the subject of an unconstitutional taking). … 

Join me on January 8, 2024, as I present “Rights Included in Rights-of-Way” during “California Highway and Utility Rights-of-Way,” a webinar hosted by HalfMoon Education. During my presentation, I will discuss the condemnation process, landowner rights, maintenance of rights-of-way, alterations and encroachments and different types of rights-of-way used for highway purposes.

HalfMoon Education is a nonprofit continuing education provider whose mission is to develop and sponsor high-quality, timely and competitively-priced continuing education seminars ...

In California, a business operating on real property being acquired, in whole or in part, for a public project may make a claim for loss of goodwill and be entitled to compensation if the business operator establishes the foundational elements: (1) the taking caused the loss, (2) the loss could not be prevented by relocation or other reasonable mitigation measures, (3) the loss is not includable as a reimbursable relocation expense, and (4 ) the loss does not duplicate other compensation being paid.  (Code Civ. Proc. §1263.510(a).)  As part of its affirmative duty to mitigate damages, a ...

This past week I had the opportunity to attend the International Right of Way Association’s (IRWA) Region 1 Fall Forum and Symposium in San Diego, California. On Friday, Brad Kuhn and I presented an update on recent federal and state cases impacting takings, land use and development in California.  On Saturday, I was an attendee at the Fall Forum where IRWA professionals throughout Region 1 (California, Nevada, and Arizona) shared updates on the status of the industry in their area. … 

2023 has been another interesting year in the eminent domain world. We’ve reported on some interesting court decisions, we’ve seen funding make its way to some critical infrastructure projects in California and changing weather continues to make resiliency and natural disasters a hot topic for inverse condemnation law. But before 2023 winds down, there are some exciting end-of-year events and we hope to see you there.  … 

A question that arises with some frequency in our practice is whether a public entity can adversely possess a property interest against another public entity. The general rule of thumb is that a private entity cannot obtain an interest in real property owned by a public entity through adverse possession. This rule is in part based off of the long-established principle nullum tempus occurrit regi, which means "time does not run against the king."

In California, this common law principle has been affirmed and reaffirmed for over a century in our courts and has been codified by the ...

With the frequency of wildfires and flooding, landslides are becoming more frequent throughout California. When public agencies have water pipelines located in hillsides, the situation presents the classic “chicken or egg” debate: (1) did the soil movement cause the pipe to displace and leak water, thereby causing the landslide, or (2) did the pipe leak water independently, thereby causing the landslide? Answering this question addresses one of the key factors for liability for inverse condemnation and other real property causes of action: causation. … 

The Supreme Court has granted certiorari in George Sheetz v. County of El Dorado, agreeing to answer the question of whether legislatively enacted development impact fees are subject to a lower level of constitutional scrutiny than fees that are imposed by a permitting authority on an ad hoc basis. While this question has been presented to the Court multiple times over the last several decades, historically the Court has declined to take up the issue. Now, with the changing makeup of the Court, at least four justices appear willing to address the issue. … 

We are excited to partner with Gallagher & Kennedy once again to host Condemnation Summit XXX on October 27, 2023 in Phoenix, AZ! We have developed another outstanding agenda filled with educational and interactive presentations and plenty of time for networking. Join us to hear from subject matter experts as they discuss timely information on industry topics, including:

• Unusual and forgotten condemnation statutes;
• Condominium terminations;
• Technology in the law;
• Eminent domain jury verdicts; and
• Powerline avian protection.

Arizona Supreme Court Justice William Montgomery ...

In California, when a government entity adopts a resolution of necessity to acquire property by eminent domain, that resolution typically “conclusively” establishes the requisite findings of public use and necessity. However, when the government is seeking to condemn a public utility to take over its operations, that conclusive presumption disappears. There has been an ongoing dispute about what standard of review applies in such take-over cases, and the California Court of Appeal recently provided guidance. … 

We recently had the pleasure of collaborating with Robert Thomas and Ajay Gajaria once again for the International Right of Way Association’s (IRWA) biannual report covering numerous eminent domain cases at local, state and federal levels from January through the end of June 2023. This report is an important resource and reference point for professionals in the right-of-way industry.

In the report, we also take a brief look at pending, adopted and failed legislation across the U.S., while also providing updates on federal funding and projects associated with the recent ...

I recently had the privilege of participating as a guest on The Eminent Domain Podcast to talk about trying an eminent domain case to a jury and my thought process around voir dire, opening statements and presentation of appraisal evidence. The Eminent Domain Podcast is ... 

Local governments—generally counties—impose property taxes on real estate pursuant to state law. Sometimes called ad valorem taxes, these property taxes are set based on the assessed value of the property. When a landowner does not pay their property tax, the law allows the county to foreclose on the property and sell it to another person.

The purpose of this sale is to make the county whole for the tax debt. In most states, if the property sells for more than the debt and there are excess proceeds, then the landowner receives the surplus after valid lienholders with priority are ...

In a recent article for Valuation magazine, “A Changing Landscape: How new state legislation may affect eminent domain valuation,” we examine how new and changed legislation can affect the role appraisers play in eminent domain actions, as well as how condemnation valuations are governed. ... 

Redevelopment agencies (RDAs) have held a rather infamous position in California history.  While originally created to address urban decay (aka “blight”), generally speaking, RDAs developed into entities that wielded the power of eminent domain to designate large areas of property “blighted,” acquire the property, and then hand it off to private developers.  The RDAs were motivated to engage in this behavior because they captured the increases in property tax revenues that resulted from the increase in property values caused by the urban renewal projects. This resulted ...

In eminent domain cases, it is uncommon that right to take challenges are upheld, and when they are, it is typically a procedural deficiency that can be cured. It is even more unusual where a right to take challenge is successful based on the condemning entity not possessing the power of eminent domain. But, that is exactly what recently happened with an eminent domain case in Northern California involving a popular excursion train – the Skunk Train. ...

We are excited to cohost Condemnation Summit XXIX with Gallagher & Kennedy on May 12, 2023 in Phoenix, AZ! Gallagher & Kennedy’s Jennifer Cranston and I have developed an outstanding agenda filled with educational and interactive presentations and plenty of networking. Subject matter experts will discuss a variety of topics, including:

• Arbitration for Condemnation Practitioners
• Temporary Construction Easements
• Access Issues
• Ethics for Real Estate Professionals and Attorneys
• Public Use Determinations

This all-day program encourages deeper conversations and social ...

In the most recent biannual report from the Real Estate Law Committee of the International Right of Way Association (IRWA), we once again collaborated with Robert Thomas and Ajay Gajaria to examine numerous cases at local, state and federal levels from June to the end of December 2022 that are of interest for professionals in the right-of-way industry.

In the report, we also take a brief look at pending and adopted legislation, while also providing updates on federal funding and projects associated with the recent Infrastructure Bill. The report also examines a similarly notable case ...

Planning and constructing large public works projects can take years. When those projects will impact private property, owners are left in a difficult situation, as the cloud of condemnation hangs over their property, making it difficult to lease or sell. When do planning activities for public projects go too far, and trigger inverse condemnation liability? A recent court of appeal decision, Ramsey v. City of Chowchilla (2023 Cal.App. Unpub. LEXIS 2147) provides some clarity on just how much flexibility is afforded to public agencies. ...

April 1st is an important milestone in California’s water year – marking the annual snowpack assessment and related drought determination. In the inaugural issue of Nossaman’s California Water Views – 2023 Outlook, our attorneys and policy advisors who are committed to the water sector identify the pivotal issues they’re watching now and for the year ahead.

Of particular interest to our readers, Brad Kuhn and Jillian Friess Leivas examine whether or not public agencies could face inverse condemnation liability for any flooding-related damages due to the recent storm ...

With all the recent storms in California, private property is bound to suffer impacts from storm water runoff, landslides, erosion and subsidence. Understanding whether the government bears responsibility for such damage is a complex and fact-specific analysis. However, a recent court of appeal decision, Shenson v. County of Contra Costa (2023 Cal. App. LEXIS 244), provides an excellent history on liability in these circumstances, and explains when natural watercourses, drainage improvements, and a public agency’s approval of development can trigger inverse ...

Join us on April 18, 2023 as we present “Right of Way 101 – An Overview of the Condemnation Process” during the International Right of Way Association (IRWA) Chapter 11 Luncheon in San Diego, CA.

Right of way and condemnation is the overarching process that encompasses everything from identifying project alternatives to ultimately acquiring specific property. During this presentation, we will provide an overview of the entire process and illustrate how all of the individual components work together. In particular, they will provide insight into how to effectively navigate ...

Join me on March 16, 2023, in Anaheim, CA for the Masters of Trial panel, “Tips and Tactics for the Courtroom,” during CLE International's 25th Annual Southern California Eminent Domain Conference. My fellow panelists and I will provide insights regarding best practices to use while in the courtroom to achieve favorable results. We’ll explore jury selection, burden of proof, presentation of evidence, trial preparation, jury instructions, demonstrative exhibits and other eminent domain trial related issues.

During this conference, attendees will learn and discuss how ...

We are excited to be hosting our Eminent Domain seminars in person once again! Please join us in San Francisco on March 14th or Costa Mesa on March 28th. These complimentary programs will focus on current issues involving right of way, property acquisitions and eminent domain. Key topics to be covered by our panels of leading industry professionals include:

• Inverse Condemnation and Disaster: Exploring the interplay of natural disaster and potential liability to public entities in cases such as fire and flood;
• Environmental Considerations for Right of Way Acquisition: Identifying ...

The payment of “just compensation” for the taking of private property includes more than merely writing a check to the property owner after a jury determines the current fair market value of the taking. A property owner is entitled to interest on the award of condemnation as well. 

Over the last year, the Federal Reserve has raised its federal funds rate multiple times. In California and Nevada, the interest rate is calculated in very different manners and the increase in the federal funds rate has differing impacts.

California

In California, a property owner is entitled to interest ...

Join us in Austin, TX or virtually for Eminent Domain and Land Valuation Litigation 2023 hosted by American Law Institute Continuing Legal Education (ALI CLE) February 2-4, 2023. This conference will benefit land use, zoning or real estate lawyers, particularly those who may be involved in an eminent domain dispute; appraisers; property valuation consultants; constitutional law enthusiasts; and municipal/local government lawyers.

During “When the SWAT Team Comes (No) Knocking: Police Power Takings” at 9:00 a.m. CT on February 3rd, Steve’s panel will discuss the ...

According to the U.S. Court of Appeals for the Ninth Circuit, the answer is a definitive yes. 

Generally speaking, Pullman abstention permits a federal court to stay a federal claim to allow a state court to resolve a state issue that could either eliminate or narrow the scope of the federal claim. In order to invoke Pullman abstention, the federal claim must also touch on a sensitive area of social policy and involve an undecided question of state law.

In Gearing v. City of Half Moon Bay, the Gearings asserted that under California’s Housing Crisis Act and California legislation passed ...