Condemnation comes as a result of a government (local city, state or federal) seeking to acquire or use the land for either public or private means, making an offer to the owner for compensation. This includes making space for a major project like a road, railway, or even a public utility like a school, a public part or residential settlement. There can also condemnation for other uses like military use, mining projects or for an environmental reason.
The owner of the asset cannot object to this role and is only allowed by law to negotiate the amount of compensation due to him. These are provisions under the 5th Amendment.
The condemnation processes are mostly guided by a court of law. The courts decide if the property is worth being condemned or whether or not the amount offered is fair or just.
This process can be extensive and taxing but with a formidable legal counsel, you are likely to go through it with ease. We have engaged in condemnation matters and assisted clients in obtaining a favorable result. The attorney, during this process, assists in negotiating a fair payment and also deals with the contractual issues, especially if the asset has tenants or other users who will require termination of their tenancy.
Condemnation mainly targets real estate though it is not limited to that. There have been cases of eminent domain on intellectual property as well as privately held funds when the government feels those funds can be used for the public good.
Circumstances under which an Asset can be condemned
Governments are in frequent need of land and at various times a government requires the use of certain parcels of land for a specific need. The laws that govern condemnation (also known as eminent domain) dictate that the owner of the land has little or no say in whether the land will be acquired but can only negotiate the amount of compensation. Even then, the government uses valuation experts to determine an asset’s value.
- Seizure of asset for private purposes – This is widely debated but it is something that can happen. The government may feel that private land is not having enough impact on the public good and might seize it to be converted to another private hand that will generate more revenue for the government. This can also involve taking over an asset or a building that, once in the hands of the government, can generate additional taxes, jobs or even investments. A city can seize private land in the event such as they are experiencing a housing shortage and then allows a private realtor to build houses for public use.
- Seizure for public use – This is the most common type of condemnation. In this case, a state may choose to seize a private asset to allow construction of a road, a school, utility installation, such as power lines or pipelines, as well as, to construct public spaces like parks and game zones.
- Seizure for military government agency use – When it comes to sensitive undertakings, a government might decide to take private land and convert it for use by the military or sensitive research. In this instance, the government finds it easy to convince the court that the land will be put to better use or argue that by removing the owners of the land, it shields them from grievous harm. There are elaborate clauses that grant the military power to establish defenses, fortifications and expand existing bases through condemnation.
- Seizure for mineral and other state use – Mining laws allow mining companies to condemn land they feel holds substantial minerals, both at the surface and subsurface.
Processes of Condemnation
- Identification of the land for condemnation
The government may use the above reasons to identify an asset. This is an important step as they have to produce a valid reason why this asset must be condemned.
- An offer of pro tanto award
The state then moves to discuss with the owner of the land or asset and offers a partial payment as compensation for the land being seized. If the owner accepts the offer, the process is made easy and the acquisition proceeds. However, if the owner objects to the offer, the state must move for an action before the court seeking the right to an eminent domain.
- Seeking Issue of right to eminent domain
The state files a case or a suit in a court of law detailing the reason it needs to have full control or seizure of the asset. The court then schedules a hearing so that each party may present their case for or against condemnation.
The court can order a valuation process to determine the actual cost of the asset. Most of the value given by the state is dictated by the market value, however, there instances when the state presents a value, lower than market value, at which time the assistance of an attorney can guide you through this process.
- A court hearing for compensation
The court allows the parties to reach the most reasonable resolution and compensation is awarded pursuant to that resolution.
Defense against Condemnation
We have defended and been granted fair compensation for clients on assets earmarked for condemnation. The attorney may present various grounds in building their case and defending the clients’ asset against compulsory seizure such as:
- Identify errors either on the procedure used to file condemnation suit – This is mostly used as a delay tactic allowing the owner time and resources to obtain fair compensation. By challenging the procedure, the entity seeking eminent domain might delay and then return once the procedural error is rectified. The advantage is that, when they return, the value of the land may have increased.
- Challenge on the intended use of the asset – If an owner convinces the judge that the land is not as important to the entity seeking to condemn it, they may receive relief and avoid the land being seized. For example, an attorney can prove that the land will not provide adequate public good as indicated by the party seeking seizure.
- Produce evidence that the compensation package is inadequate – If your legal team sends viable evaluation reports showing the cost of the land being condemned, a judge may decide that the owner should receive higher compensation. The trick is to do your homework to ensure the right value is achieved.
- Prove a case of inverse Condemnation – When a government takes over an asset without compensating the owner or giving poor compensation, the landowner can move for the court to grant fair compensation. This can occur in the case of both permanent land seizure and temporal use. For example, the government may be sued if, in the process of creating a dam, water seeped out and flooded areas downstream, displacing owners. The owners can then seek damages and inverse condemnation compensation. Various states have a different way of addressing this matter, but the procedures of compensation are generally standard. The 5th Amendment shields the population against unjustified compensation or takeovers.
The entity seeking an eminent domain must provide clear ways under which it compensates those affected. This includes providing alternative land under which those affected can relocate. A relocation plan is sometimes requested by a court of law to ensure there is just and fairness in this exercise. Within this relocation plan, the Eminent Domain entity must cover the cost of relocation, which at times may involve the transportation or the cost of establishing a new base. In some instances, the eminent domain may also be required to pay for any costs associated with advertising/informing others of the new location address.
Reviewing your Condemnation Suit
When a state or government agency approaches you for condemnation, it is best to immediately seek legal advice from your most-preferred attorney. Your legal team will help clear the grey areas of this process.
Every case is determined differently and no matter the number of times you have faced a condemnation suit, it is always important to pass it through your legal team.
For more information, contact us. We can assist you in dealing with matters in case they arise and help you get the fair hearing you deserve.