Eminent Domain Report

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 ...

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 ...

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. ... 

Property dedication requirements and eminent domain usually don’t mix well: they make for an odd and confusing set of valuation rules. For example, if an agency seeks to condemn property to build a road through an undeveloped area, but that road would be required in order to develop the properties, how should it be valued? Under one set of eminent domain rules (the Porterville doctrine), the property subject to dedication has little value since it would have to be given up as part of any future development. Under another set of eminent domain rules (the “project influence rule” ...

In California eminent domain cases, appraisers typically have relatively wide latitude in determining fair market value for the property to be acquired. However, there are certain rules they must follow, and when an appraiser violates those rules, the appraiser’s opinion may be completely stricken, leaving a property owner or a public agency with no valuation evidence. This is precisely what happened in a new unpublished California Court of Appeal decision, Solano Transportation Authority v. Anderson (2021 Cal.App. Unpub. LEXIS 2129), where the property owners’ ...

Providing listeners a convenient and concise medium to access timely reports on important land use topics, Nossaman’s recent podcast offerings make a great addition to your professional playlist.

First, check out Nossaman’s own Digging Into Land Use Law podcast, which covers the development of all things in, on or above the ground. Recently, I recorded the episode “Valuation and Damages: Assessing COVID-19’s Economic Impact.” Changes in how businesses operate, restrictions on property use and reduced revenues brought on by mandated closures due to COVID-19 have had ...

On December 3, Brad Kuhn and Maya Hamouie will co-present “Business Valuation and Damages: Assessing COVID-19’s Economic Impact” at the virtual lunch hosted by Chapter 1 of the International Right of Way Association (IRWA) for its members.

Brad and Maya will review the impacts of COVID-19 on the economy, discuss business valuation methodologies and how to take COVID-19 into consideration, then review how these scenarios are playing out in litigation. Following the presentation, they will have an interactive Q&A session with members of the audience.

Chapter 1 of IRWA seeks ...

On April 1, Nossaman’s Eminent Domain Group hosted a webinar to discuss the impacts COVID-19 is having on the Right of Way industry.  First, I’d like to thank the people who attended, many of whom added thoughtful questions to the discussion.  It’s clear a lot of people are giving these issues a lot of thought.  Second, obviously things continue to evolve at a breathtaking pace, and even by the time this post goes from being drafted to appearing on the blog, things are likely to change. 

Note that this post is not meant to recap the things we discussed at the webinar.  If you weren’t able to join us and want to review what we covered, feel free to download the COVID-19 PowerPoint we used, or watch the entire recorded webinar.  No, the purpose of this post is to provide some insights as to what other right of way professionals are thinking about a few of these issues.  During the webinar, we asked several poll questions, and since the Nossaman team found the results interesting, I’m hoping some of you will as well ...

COVID-19 has undoubtedly upended the world, including the way we do business and the future of our economy. We have received a number of questions and concerns from clients in the right of way industry on how the current pandemic affects the way we do business, and what to expect going forward. Please read on for links to helpful resources...

In Freeport Reg’l Water Auth. v. M&H Realty Partners VI, L.P., 2019 Cal. App. Unpub. LEXIS 6126 (Sept. 16, 2019), the court walked through a complicated fact pattern involving – in its simplest form – a 40-foot easement for an underground water pipeline.  For our purposes, the key issues were valuing (1) the easement being acquired, (2) the severance damages caused to the remainder parcel, and (3) a temporary construction easement for the pipeline’s installation.  Though it was not technically a eminent domain case because the parties had reached an agreement concerning the ...

In an eminent domain proceeding, the property owner and the condemning agency each typically introduce evidence of just compensation through valuation experts. The jury is then required to render a verdict in between the owner’s (high) valuation and the agency’s (low) valuation. Usually the biggest delta between the sides involves severance damages -- or damages to the remainder property not being acquired. But what happens when the agency’s appraiser does not render a specific valuation opinion, instead simply concluding that any damages are offset by project benefits? Is this sufficient, or is the appraiser required to identify specific dollar amounts for damages and benefits? A recent Court of Appeal decision concludes that the appraiser is not required to identify specific damages and benefits ...

We welcome you to join our Partners at several upcoming presentations on eminent domain topics taking place near and far.

First, Nossaman's Eminent Domain & Valuation Practice Group Chair Brad Kuhn will be presenting during Nossaman's 2019 Land Use Seminar on May 21st, in Costa Mesa, CA.  Brad will be part of a discussion concerning the very timely topics of Managed Retreat and Sea Level Rise.  This is an area of great interest for both private landowners, cites and towns, and public agencies alike, and the presentation will provide an overview of the current proposals and ...

Join Brad Kuhn, Chair of Nossaman's Eminent Domain & Valuation Practice Group, at the International Right of Way Association's Chapter One Annual Valuation Seminar.  The event will be held on Tuesday, February 12, 2019, at the Quiet Cannon Conference Center in Monterey Park, CA.  Brad will be addressing What To Do When the Cookie Isn’t From A Cutter:  Unusual Valuation Scenarios From Eminent Domain.  For current information on the seminar, please consult the IRWA Chapter One website.

Covering Los Angeles, Chapter One is the founding Chapter of the International Right of Way ...

Please join Nossaman Eminent Domain & Valuation Partner Rick Rayl at CLE International's 21st Anniversary Southern California Eminent Domain Conference.  The event will be held from Thursday, January 31^st through Friday, February 1^st at the DoubleTree Downtown in Los Angeles.  Rick will participate in the presentation, Case Law Update:  The Latest Developments, on January 31^st at 10:45 a.m.  Additional topics covered during the conference will include: Government Regulation of Short-Term Vacation Rentals, Insights into Severance Damages, and California’s Wildfires and Potential Inverse ...

On November 1, Nossaman Eminent Domain Partner Bernadette Duran-Brown will be Co-Chairing the Southern California Appraisal Institute’s 51st Annual Litigation Seminar.  Additionally, Ms. Duran-Brown will be joined by Brad Kuhn, Chair of Nossaman’s Eminent Domain & Valuation Practice Group, who will be participating in a panel discussion concerning Easement Valuation.

The seminar will be held on Thursday, November 1^st, at the Omni Hotel, 251 South Olive Street, Los Angeles.  The event will kick off with registration and breakfast at 7:30 a.m., and will also include luncheon ...

For years, the College of the Desert has been seeking to acquire the former Palm Springs mall in order to expand its campus to the west valley.  It has been quite a lengthy battle, as the property owner had repeatedly objected to the College's use of eminent domain for the site.  However, last week, the parties finally reached a settlement of the condemnation action, with the College agreeing to pay $22 million for the property -- dramatically more than the $9.6 million the College originally offered to pay.

According to an article in the Desert Sun, the 29-acre property will allow the College ...

This week, Nossaman Eminent Domain Partner Bernadette Duran-Brown will be speaking at the Southern California Appraisal Institute’s 50th Annual Litigation Seminar.

Ms. Duran-Brown will be providing a Summary of Recent Eminent Domain and Valuation-Related Cases. Her presentation will cover the most recent and upcoming legal developments and is essential for anyone involved with public projects or affected by large-scale development in the region.  We will provide a follow-up blog post summarizing Ms. Duran-Brown’s presentation for anyone unable to attend in person.

The ...

Acquiring a fee interest in property seems to be so out-of-style.  Nearly every linear infrastructure project I work on now involves the acquisition of various types of easements, whether its a typical temporary construction easement, access easement, street/highway easement, or transmission line easement, or a more complicated aerial easement, parking structure easement, or floating easement.  The scope and terms of these easements can have massive ramifications on compensation, and particularly severance damages to impacted properties.  If you're interested ...

Having recently worked on a number of pipeline and transmission line projects, I find the issue of proximity damages to be fascinating.  Does being adjacent to gas pipelines or electrical transmission lines diminish the value of an owner's remaining property?  I have seen studies suggesting nearly every possible conclusion.  If you're interested in this subject, there's a great article that was recently published in the Appraisal Institute's Appraisal Journal, Summer 2017 edition, titled The Effect of High-Voltage Overhead Transmission Lines on Property Values:  A Review of ...

When a business is taken as a result of a public improvement, the business is entitled to seek compensation for, among other things, loss of business goodwill. Typically, this loss is calculated by measuring the business’ before-condition value and comparing to its after-condition value.  This traditional methodology was the cornerstone for business goodwill appraisers to determine just compensation.  Yet late last year, the California Court of Appeal issued a ruling in People ex rel. Dep't of Transp. v. Presidio Performing Arts Found. (2016) 5 Cal. App.5th 190 which may have ...

In a previous post, "What is 'Just Compensation' For Gas Station Acquisitions," we explored various methods for valuing gas stations and car washes in an eminent domain action, including a recommendation by a gas station appraisal firm, Retail Petroleum Consultants, to approach such valuation assignments as "special use properties".  Retail Petroleum has issued another useful article, "Value Trends in Gas Stations and Car Washes," which examines recent trends driving the valuation of such properties in California.

Retail Petroleum explains that because gas stations ...

In an unpublished opinion filed this week, the California Court of Appeal confirmed two fundamental evidentiary rules related to eminent domain matters:

1. A witness intending to testify to an opinion of value must exchange a statement of valuation data; and
2. A witness will be precluded from testifying to a comparable sale if it is determined by the court that the comparable is not comparable and would confuse the jury.

Before we delve into the case, here’s a basic reminder of California law as it pertains to these two issues:

With respect to the court’s first finding, California Code of ...

Six weeks ago, I wrote about California Assembly Bill 624 and the Appraisal Institute’s effort to change California law that presently requires all licensed appraisers to comply with the Uniform Standards of Professional Appraisal Practice (USPAP).  While the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (FIRREA) would still mandate that USPAP be followed for federally-related transactions (i.e. appraisals for a financial institution that is federally insured), I observed that a licensed appraiser in California performing an appraisal for a ...

I know our blog is called the Eminent Domain Report -- implying we only cover eminent domain-related issues, but in actuality we cover anything valuation-related.  After all, our group of attorneys is known as the Eminent Domain & Valuation Practice Group.  With that said, an interesting value dispute has popped up, making its way to the California Supreme Court.  This one deals with whether intangible assets should be included in one's property tax assessments, and we're looking forward to the Court's decision.

The case, Elk Hills Power v. California State Board of Equalization, deals ...

In my recent post on City of Corona v. Liston Brick Company of Corona, 2012 Cal. App. LEXIS 873, I took a few minutes to discuss the conflict under California law concerning what happens when one side presents a valuation opinion and the other does not.  As I explained there, while I can see a basis for a rule that the jury must accept a single opinion of value OR a rule where the jury remains free to reach its own conclusion even if only one opinion is presented, I have a real problem with the current state of the law -- where sometimes the jury gets to decide and sometimes the judge directs a ...

Eminent domain cases typically revolve around one issue in dispute:  the property's (or business') fair market value.  And when appraisers seek to reach their opinions of value, they typically rely on a standard body of data:  comparable sales; income and expense figures; and reproduction costs. 

But sometimes the evidence does not fit into one of these neat boxes, either because there is a lack of "classic" evidence or because one party is seeking to adduce evidence of value in a more creative way. 

A recent published decision, City of Corona v. Liston Brick Company of Corona, 2012 Cal. App ...

Last April, we reported on a bizarre case arising out of the City of San Clemente's attempt to down zone a piece of property.  The trial court had concluded that the down zoning constituted a taking and ordered the City to rescind a decision supported by that down zoning.  The City had denied an application to develop the property because the application did not conform to the current general plan and zoning ordinance (the City seems to have sidestepped the fact that the development applications included applications to amend the general plan and zoning). 

In addition to a writ of mandate ...

The use of eminent domain in a declining real estate market presents a number of unique issues.  I often receive calls from property owners who are frustrated with the government's timing of condemnation proceedings, and want to know how they can get market-peak-values for their property. 

This issue was the hot topic of a previous IRWA seminar I chaired, Property Acquisition, Appraisal, and Relocation in an Upside Down Market.  And a recent blog post by the Weiss Serota Helfman law firm, Eminent Domain Valuation in a Falling Market Poses Questions for ...

A new published California court of appeal decision may be important for private utility companies with respect to the valuation of their possessory interests in public rights-of-way for property tax assessment purposes.  The case, Charter Communications Properties v. County of San Luis Obispo, provides that when assessing the fair market value of a utility's possessory interest, the County tax assessor will likely be able to disregard the utility's agreed-upon remaining term of possession and instead assume a much longer anticipated term of possession to match reality.  This ...

On July 29, 2011, the California Court of Appeal issued an unpublished decision confirming that when condemned property is subject to a roadway easement, and the property owner fails to demonstrate that there is "something special attaching to it," regardless of how the property is ordinarily bought or sold, the landowner is only entitled to nominal value.

In People ex rel. Department of Transportation v. Bakker, No. F060030, the California Department of Transportation (Department) condemned 18.13 acres of land belonging to the Bakkers, 4.4 acres of which were subject to a ...

When eminent domain attorneys think of just compensation in the context of an eminent domain case, we're typically thinking about the value of what we can see:  the dirt itself; and anything built on that dirt.  But every so often, a property's real value lies not in what is on the surface, but what sits below the surface.

A recent post by the Biersdorf law firm, Mineral Rights in Eminent Domain Cases, reminds us about this often overlooked issue.  The post contains a nice summary of when and how these issues can arise, and I won't repeat all of what they have to say.  The bottom line is that when a ...

In California eminent domain cases (this is an area in which the law varies dramatically from state to state), the property / business owner is entitled to an award of litigation expenses (including attorneys' fees) if (1) it makes a reasonable final demand for compensation and (2) the agency makes an unreasonable final offer of compensation.  (See Code Civ. Proc. § 1250.410.)

How one analyzes "reasonableness" once the jury issues its verdict has been the subject of a number of court opinions.  Tracy Joint Unified School Distract v. Pombo (Oct. 29, 2010) adds to that body of law. 

In ...

Another recent interesting court decision was somewhat lost in all the excitement last week over (1) the County of Los Angeles v. Glendora Redevelopment Project case striking down Glendora's redevelopment plan for inadequate blight findings and (2) the US Supreme Court decision in the Stop the Beach Renourishment, Inc. v. Florida Department of Environmental Protection case rejecting a "judicial takings" claim. 

That recent decision was by the California Court of Appeal in City of San Jose v. Union Pacific Railroad, which came down a month ago, but received little ...

A fundamental premise underlying eminent domain laws is that the owner is treated fairly under principles of just compensation.  This means that the owner receives fair market value for the property being condemned.  And, where there is an active, relevant real estate market with ample comparable sales data, this premise can be upheld through traditional appraisal methodologies.

Unfortunately, not all markets include legitimate, open market transactions from which to gather comparable sales data.  This is especially true where market conditions have deteriorated; in other ...

Just a few weeks ago, we reported on Tulare County's plans to condemn a number of properties to facilitate the widening of Road 80.  Now, Visalia Times-Delta reporter Valerie Gibbons reports that Tulare County is considereing condemnation for four additional parcels, this time to facilitate the widening of Road 108 (or Demaree Street) between Visalia and Tulare. 

The November 11 article, "Board of Supervisors moves to seize land for Road 108 project while still in property negotiations," explains that both the Road 80 and Road 108 projects raise the same concerns from property ...

Eminent domain lawyers who practice in Los Angeles County Superior Court are all familiar with LA County's detailed local rules on eminent domain -- "Chapter 16."   Chapter 16 is the chapter in the Los Angeles County local rules that deals specifically with eminent domain, and it contains meticulous procedural rules for the conduct of condemnation cases in Los Angeles.

Key provisions involve an elaborate "First Pretrial Conference" requiring a substantial, joint written submission to Department 59 (the LA County eminent domain department), along ...

On Tuesday, the City of Lake Forest voted unanimously to move forward with plans to condemn a 6.11-acre parcel to use as a land swap with the County of Orange.  The property will likely end up being incorporated into Whiting Ranch Wilderness Park. 

According to Orange County Register reporter Erika I. Ritchie, in her November 4 article "City moves forward with seizure of family's land," the property's owner, the Hernandez family, has resisted all efforts by the City to acquire the property voluntarily.   But the City needs the property to complete a land swap with the County that will ...

In his September 16 article entitled DWP outmaneuvered on Kern County land purchase, Los Angeles Times reporter David Zahniser described a story full of political intrigue. It seems someone with ties to Mayor Villaraigosa acquired a property out from under the Department of Water and Power (DWP), only to immediately offer to sell the property to DWP at a hugely inflated price. While the article focuses mainly on the political aspect of the situation (e.g., did the buyer know about DWPs plans for the property when it purchased it, etc.), the eminent domain angle is also interesting.

The ...