In the video below, Dan Biersdorf, our lead attorney, discusses fee and cost recovery in Eminent Domain
One of the greatest hardships imposed on property owners in an eminent domain proceeding is the burden of paying attorneys and experts and incurring other costs when the owner wants to challenge the power of eminent domain. These burdens fall into four general categories.
One category involves challenging the right to take. State and federal constitutions limit eminent domain takings by a condemning authority to situations where the taking will further a public use. Over the years, the concept of public use has expanded to also mean public purpose. Both of these concepts incorporate the requirement that the scope of the taking is limited to what is necessary to accomplish the public use. Naturally, a property owner, who is subject to a taking, is entitled to challenge the right to take on the grounds that the taking does not satisfy the public use requirement of either the state or federal constitution. Where a property owner is successful in challenging the right to take, many states will allow the costs and fees incurred by that owner in that challenge to be reimbursed by the condemning authority.
A second category, where fees and costs burden an owner, arises when a taking occurs, but the condemning authority has refused to acknowledge it. These situations occur, generally, when a condemning authority either 1) physically invades private property or 2) enacts an onerous regulation on property that effectively takes the property from the owner. An owner is not without recourse in these situations. The owner has the right to initiate an inverse condemnation action which seeks a court order declaring that the invasive activity or regulatory action constitutes a taking of the owner’s property. In pursuing an inverse condemnation action, the property owner will be required to incur costs and fees. Where a property owner successfully obtains a court order that declares that a taking has occurred, many states will allow the property owner to recover those costs and fees from the condemning authority.
The most common challenge to the power of eminent domain involves an owner seeking more money for the condemned (taken) property than the condemning authority was willing to offer. This addresses the constitutional requirement that the condemning authority must pay just compensation for any property it takes under the power of eminent domain. Condemnation offers will often be way below the amount necessary to satisfy the just compensation requirement. Two common reasons for low offers are the failure by condemning authorities to acknowledge 1) the proper highest and best use for the property or 2) severance damages to the remainder property still retained by the owner after the taking. The full list of reasons, though, is much broader than this. In many states, where an owner successfully recovers more money than the offer from the condemning authority, the owner can also recover the costs and fees which were incurred to get this extra money.
As the foregoing discussion explains, property owners can incur significant costs and fees defending their rights in eminent domain proceedings. Periodically, but infrequently, a condemning authority will choose to abandon its project and end up not taking the property that was targeted. The property owner now still owns the property but has incurred significant costs and fees defending the owner’s rights in the preceding that has been abandoned. Most states recognize that this is unfair to the owner, so owners in that situation will also be allowed to recover the costs and fees that were incurred in that proceeding.
Below is a listing of the states and how they address the reimbursement of cost and fees for the categories discussed above. Since states do expand the rights of owners from time to time, it is always good to check an area where non-reimbursement is shown to see if that has been expanded in that state.