June 14, 2016

So the Government Wants Your Property: Answers to 10 of the Most Common Landowner Questions

If the government is seeking to take your property, it’s important to ensure you receive fair treatment and compensation. Read on for an outline of what to expect and tips to protect yourself during the condemnation process.

1. Can the government really take my property?

Generally, yes the government can take your property as long as two general requirements are met:

  1. The governmental agency has condemnation authority.
  2. The taking is for a “public purpose.”

In very limited circumstances, there may be a basis to challenge whether the proposed taking is for a public purpose. These situations, however, are uncommon. You should also be aware that some nongovernmental entities such as public utilities and pipeline companies also have condemnation powers in most states. As a result, even private entities can sometimes take your property if they have met all of the specific legal requirements to do so.

2. What will happen first?

The government will first try to acquire your property through voluntary negotiations. A government representative or their agent will likely contact you about the project and make one or more offers to purchase the property. You will likely receive formal letters which are sometimes called a “notice of intent to acquire” or “initial offer letter” and/or a “final offer.” These formal letters are important because they can set the bar for your ability to recover your attorneys’ fees and start a clock on the time that you have to obtain an appraisal at the expense of the government. If you do nothing in response to these formal letters, you may lose some of your rights.

3. What is this appraisal I received from the government, and do I need to get my own?

The government will usually (but not always) obtain an appraisal of your property in order to provide a monetary offer of just compensation. Sometimes they will give you a copy of the appraisal voluntarily and sometimes you will have to ask for a copy. You should not assume that this appraisal, or the offer it is based upon, has accurately analyzed all of the economic consequences to your property from the proposed taking. Depending on the state, the government may be required to reimburse the reasonable cost of your own appraisal (as long as you meet certain timing requirements or other prerequisites), so it is worth knowing the law in your state on this issue.

4. How do I find my own appraiser?

It is important that you retain an appraiser who is experienced in performing eminent domain valuations on a regular basis. A general appraiser who may have appraised your property for a mortgage is highly unlikely to have experience and expertise necessary to prepare an appraisal that can be used in an eminent domain case. Additionally, each taking and property is different. Often, even experienced eminent domain appraisers will need to understand certain legal principles if they are to accurately assess the just compensation due to a landowner whose property is being taken.

5. Why has the government named me a in a lawsuit?

In the event that negotiations are unsuccessful, the government will file a lawsuit seeking to take the property in exchange for what it deems is “just compensation.”

6. Do I need a lawyer?

Condemnation lawsuits are a very specialized area of the law with unique statutes and case law defining what a landowner can and cannot recover in any given case. Landowners benefit greatly from hiring an experienced eminent domain attorney early on to assess what damages are available under the law of any given state. An experienced eminent domain attorney can also help you retain the appropriate appraiser for your situation. It is therefore incredibly important to retain a lawyer who specializes in eminent domain. It is often advantageous to retain a lawyer well before any condemnation lawsuit is filed. He or she can help analyze any pre-filing documents, assist with the retention of an experienced eminent domain appraiser, and assist in the pre-lawsuit negotiations. Hiring eminent domain counsel early on can result in more favorable monetary and non-monetary settlement terms and potentially avoiding litigation altogether.

7. The government says they need immediate possession of my property. Can they do that and how does it work?

In the event negotiations are not successful, the government will likely file a lawsuit seeking to condemn your property. Once that lawsuit is filed, the government can generally seek some form of what is often called “immediate possession” or a “quick take” of your property. In Colorado, for example, this is an expedited procedure in which the government can seek an order from the court to obtain possession (but not title) to your property upon the deposit of an amount that the court is satisfied constitutes a reasonable estimate of the fair market value of the property to be taken. Many other states have similar procedures.

8. The government took possession of my property. Now what?

You can usually withdraw most or all of the funds that have been deposited with the court following or at the time of the transfer of possession of your property. For example, in Indiana, a landowner can withdraw the funds deposited by the government 20 days after the court-appointed appraisers have completed their report. The court will then generally set a trial date (if not already set), at which time the ultimate amount of just compensation will be determined.

9. How does the trial work?

The procedure for condemnation trials varies by state. In some states, such as Colorado and Minnesota, valuation trials are typically held before a group of commissioners. Many states, such as Illinois, allow for one or both parties to elect to have the trial held before the court rather than a panel of commissioners. You may also have the right to ask a jury to decide how much just compensation is to be paid for your property.

10. Will I be reimbursed for my attorneys’ fees?

Your instincts may tell you that the answer should be yes, but this is complicated and varies from state to state. You may be entitled to have the condemnor pay your attorneys’ fees. In Colorado, if the final award of just compensation is at least 130 percent of the final written offer the government gave you to voluntarily acquire your property prior to filing the condemnation lawsuit, the government (with the exception of certain governmental agencies) must pay your reasonable attorneys’ fees. Many other states have similar mechanisms in place. For example, in California, the landowner may be awarded attorney fees if the court determines that the landowner’s final demand for compensation was reasonable and the government’s final offer was unreasonable in light of the ultimate compensation awarded.

The Faegre Drinker Biddle & Reath LLP website uses cookies to make your browsing experience as useful as possible. In order to have the full site experience, keep cookies enabled on your web browser. By browsing our site with cookies enabled, you are agreeing to their use. Review Faegre Drinker Biddle & Reath LLP's cookies information for more details.