There several different types of takings that we define
This acquisition by the condemning authority encompasses the entire parcel of land that belongs to the property owner. The amount of just compensation that must be paid is the market value of the parcel under its highest and best use. This valuation must assume that the project, which is causing the taking, was never conceived, never planned, nor ever going to be built.
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As the name for this taking suggest, it constitutes only a part of the parcel that belongs to the property owner. The amount of compensation for a partial taking has two components. One is the direct damages, which is the value of the land and improvements that are actually acquired. The other component is indirect damages, or severance damages, which represents the loss in value to the property, that is still retained by the owner, which is caused by the taking. The property retained by the owner is called the remainder.
Very frequently, a condemning authority will ignore or significantly understate the impact that a partial taking has on the remainder. This means the severance damages claimed by condemning authority can be vastly different from the amount actually owed to the property owner.
This is the most common taking. It means the property interest acquired by the condemning authority will never revert back to the owner. Takings used for roads and public buildings fall into this category
This is a taking that last only for a set period of time. Probably the most common example of a temporary taking is a construction easement. Where a new driveway is being built when a road is being upgraded, the condemning authority needs land around the driveway to do the construction. Thus, the condemning authority takes that land around the driveway to complete the construction. When the driveway is finished, the construction easement ends and the land around the driveway reverts back to the owner.
Just compensation for a temporary easement is typically the rental value of the land being occupied for the term of the easement. In some cases, though, the temporary easement can have a negative impact on the land that is not covered by that easement. An example is an easement which blocks access to the rest of the property. Then, just compensation for the temporary easement will be much greater and would be determined by the rental value for the entire property for the term of the easement.
Governments enact ordinances and regulations all the time that affect how real property can be used. When an ordinance or regulation becomes too onerous, it constitutes a regulatory taking.
A total regulatory taking occurs when the regulation prevents a property from being able to be used for any purpose, i.e. the property no longer has any value. This taking is called a Lucas taking after the name of the case which enunciated this rule.
A partial regulatory taking occurs when the regulation causes the property to lose a substantial portion of its value. The courts have not established a bright-line for the amount of reduction required. No known case exist, however, where the reduction is less than 70%. In most cases involving a partial regulatory taking, the loss in value will need to be 90% or more. In addition, two other factors need to be considered. Partial regulatory takings are called Penn Central takings after the name of the case which enunciated that rule.
A regulatory taking can be permanent or temporary. The law surrounding temporary takings, however, is very recent, so it has not been developed very much at this time.
Ownership of all of the interests in the title for property is called fee simple ownership. This is what applies for a typical homeowner. When a condemning authority acquires property by eminent domain, this is the most common ownership form that is acquired. When this happens, the former owner has no ownership interest left in the property. It is the same as if the owner sold it to some third party.
For any number of reasons, a condemning authority cannot or does not need to acquire complete ownership of a parcel of property. In such instances, the condemning authority merely requires an easement. One example is a drainage easement. Here the condemning authority merely needs an area of land to drain water when drainage is required. For the rest of the time the owner can use the property in any way desired so long as that use does not interfere with the drainage when drainage is required. These easements are permanent, meaning they last forever.
Another permanent easement that is taken occurs near airports. These are called an avigation easement. They extend over land that is not needed for runways or other airport improvements, but is adjacent to those lands. An avigation easement acquires the airspace over the affected land. It limits the construction of improvements in the easement area completely or to certain height restrictions so landing and departing aircraft don’t have interference with their procedures.
Another easement that is appearing more and more is an easement for underground storage rights. With the advent of natural gas replacing coal and oil as the energy source for power plants, a greater need has arisen to store gas to be available for peaks in our energy supply system. Depleted underground gas formations are now being repurposed to become natural gas reservoirs where natural gas is injected to later be withdrawn. This conversion is being undertaken by utilities which are frequently given the power of eminent domain to take these storage rights from the property owners who owned the rights in the original gas formation. These takings are done by way of easement and the just compensation calculation has become controversial.
Easement takings can also be temporary. A common example is a construction easement. Here, the condemning authority acquires land only during the period of the project to provide space to do construction work, like operating equipment, on part of the project.
Frequently, when roads with high volumes and high speeds are upgraded, the condemning authority will acquire access rights by eminent domain. When this is done, there is no longer any ability for the owner to ingress or egress the property from the road. Depending upon the highest and best use for the property which is losing access, this loss of access can create significant losses in value to that property.
If the owner is not left with any other way to get to and from the property on the ground, the property is landlocked. Then the condemning authority will be required to pay the owner the full value of the property even though the condeming authority does not actually aquire it.
A condemning authority does not gain the right to acquire an entire parcel merely because the taking of access rights causes that property to be landlocked. Frequently, the condemning authority will make an offer to purchase the entire property, though. Property owners always have the right to freely sell this property to the condemning authority if the condemning authority will buy it. However, many owners mistakenly think the condemning authority has the right to acquire the landlocked property by eminent domain, so they agree to sell the property to the condemning authority for less than it is really worth. Property Owners should not sell to the condemning authority in this situation, unless it is truly what they want to do. There are also strategy considerations for negotiating with the condemning authority in this situation that should be considered.
A recent decision by the Wisconsin Supreme Court has created a troubling scenario for property owners. In that case, when the condemning authority acquired the access rights, it also gave a revocable driveway permit to the property owner so ingress and egress to the property from the road was still possible. Some years later, that driveway permit was revoked by the condemning authority causing significant loss in value to the property. In denying the owner’s claim for lost access rights, the Supreme Court said that the claim for the lost value could not be made when the driveway permit was revoked. It had to be made when the access rights were taken years earlier. Thus, the property owner could not recover the loss in value as just compensation because it was too late to make a claim. While this decision might be an outlier, property owners should be extra vigilant when access rights are acquired and a revocable driveway permit substituted in its place to replace those rights.
Access to water usually makes a property much more valuable. On occasion, a property’s unobstructed access to water is taken or at least hindered by public trails or other public projects. This can cause significant loss in value to the property and should not be ignored.
When a condemning authority physically takes property by eminent domain, the taking can include land, buildings on the land, and/or site improvements like parking lots, landscaping, etc. These physical items that the owner loses in an eminent domain action constitute a direct taking.
Whenever a direct taking occurs, there can also be a loss in value to the property that was not taken. The property not taken is called the remainder. Any loss in value to the remainder, when compared to the value of that remainder before the taking, is called an indirect taking. That loss of value is also called indirect damages or severance damages.
Many states have a statutory provision to allow property owners with landlocked parcels to condemn a path over other private property to reach a public road. The condemned path is typically limited to the most minimal path necessary to provide such access. The condemning property owner has to pay just compensation like a governmental condemning authority would.
De facto Taking
In nearly all takings that occur, the condemning authority declares its intention to take the desired property and follow the statutory procedure for exercising the eminent domain powers and paying just compensation. In an extremely small percentage of situations, private property is taken or damaged where the condemning authority has no intention of doing so and ignores the required eminent domain statutory procedures. Some examples are: 1) flooding caused by government action, 2) passage of an onerous regulation, and 3) temporary or permanent trespassing on private property. When these takings arise and are not declared, they are called de facto takings. The ultimate problem with de facto takings is that the condemning authority ignores or refuses to recognize the obligation to pay just compensation. The remedy for the property owner in this situation is to start an inverse condemnation action.
Questions about takings or if you’re interested in a free consultation, contact us today! If you want to call us, our main number is 866-339-7242. We look forward to hearing from you.