A Lawyer's Take on Eminent Domain Issues: Better Planning to Minimize Impacts to Business Owners

A Lawyer’s Take on
Eminent Domain Issues –
Better Planning to Minimize
Impacts to Business Owners

Presented by:
Anthony H. Misseldine

©JacksonWhite, P.C.
(2012) All Rights Reserved

FY 2016 CONSTRUCTION
PROGRAM

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FLOOD CONTROL DISTRICT OF MARICOPA COUNTY:

ACTIVE PROJECTS

―. . .nor shall private property be taken for public use,
without just compensation.‖

5th Amendment to the United States Constitution

• ―Private property shall not be taken for
PRIVATE use. . .‖

• ―No
private property shall be taken or
damaged without JUST
COMPENSATION having first been
made. . .‖

Arizona Constitution: Article 2 Section 17

CAN THE EXERCISE OF THE POWER OF
EMINENT DOMAIN BE CHALLENGED??


YES, BUT FEW SUCCEED.
• Early involvement
• Be aware of planning process
• Give input (show up at public meetings)
• What is at stake if the project is approved?


WHAT IS A TAKING?


A TAKING MAY BE. . .

• TOTAL OR PARTIAL

• PERMANENT OR TEMPORARY

• REGULATORY


WHAT MAY BE TAKEN?


WHAT INTERESTS IN ―PROPERTY‖ MAY BE
TAKEN BY EMINENT DOMAIN?

• ANY INTEREST IN REAL PROPERTY

• FEE TITLE

• LEASE (LANDLORD/TENANT)

• EASEMENT/LICENSE

• SURFACE/SUBSURFACE


WHAT ARE NON-COMPENSABLE
DAMAGES?

BUSINESS LOSSESS


The Process

1. Resolution to acquire property (purchase or condemnation)
2. Appraisal or basis for valuation
• Be careful what you say or disclose
3. Offer to purchase (20 days)

4. If the property owner accepts—sale of real estate

5. If not, government must condemn:
• File lawsuit
• Immediate possession
• Expert reports/Rebuttal
• Trial
• Judgment (jury trial)
• Government pays the judgment
• Court enters a ―Final Order‖ conveying title

WHAT IS IMMEDIATE POSSESSION?

• GOVERNMENT’S RIGHT TO USE THE PROPERTY BEFORE
JUDGMENT IS AWARDED (ARS § 12-1116)
• DEPOSIT OF ―PROBABLE DAMGES‖
• PRE-JUDGMENT INTEREST ON DAMAGES FROM THE DATE OF
POSSESSION
• Includes actual damages awarded above the deposit
• The deposit may be drawn down, but there is a catch.


HUH?

• WHAT MAY AN OWNER DO WITH PROPERTY AFTER
A PUBLIC PROJECT IS ANNOUNCED, BUT BEFORE
A CONDEMNATION LAWSUIT?

• REASONABLE ENHANCEMENTS


NECESSARY INFORMATION

• Title report (read it and related documents)

• Alta survey of property

• Aggregate/Ore studies

• Reserve studies

• Supply/Demand information

• Operating information

• Royalty rate data

• Permit status and history

• Ownership

75TH AVENUE & THE SALT RIVER


VALUATION AND APPRAISAL
ISSUES
Who may testify as to the value and damages?

• Property Owner (Company representative with knowledge/authority)

• Appraiser
• Not all appraisers are the same

• Valuation method(s) must be accepted by the courts

• ―Daubert‖ challenges

• Cost

• Other experts may be required

POTENTIAL CONCERNS

• Tax valuation appeals

• Business records being shared

• Violations or citations

• Lapsed permits

• Statements/Data submitted to agencies

• Discussions with appraisers, engineers, for the government

• Prior appraisals/valuations

• Costs

U.S. ARMY CORPS and 404 PERMITS

RAPANOS et ux., et al. v. UNITED STATES
certiorari to the united states court of appeals for
the sixth circuit


THE TEAM
• Owner/Operator

• Eminent Domain Attorney

• Appraiser

• Engineer/Hydrologist/Geologist

• Others

THE PART TAKEN


SEVERANCE DAMAGE

―. . .any diminution in value of the remaining property caused by the
taking.‖

Examples of this include:
• DRAINAGE • RE-OPENING MINE PLAN APPROVAL
• LOSS OF PARKING • TRIGGERING GOVERNMENT REVIEW
• RESTRICTED ACCESS • INCREASED COST OF OPERATIONS
• DECREASING SIZE • REDUCED RESERVES
• CHANGE IN USE • PERMITS
• FUNCTIONALITY
• AESTHETICS


California Case


California Case – During Construction


California Case – Near Completion


Creamland Dairy – 2002 Aerial View


Creamland Dairy – 2007 Aerial View


PARK CITY
BEFORE


PARK CITY
AFTER


A Lawyer's Take on Eminent Domain Issues: Better Planning to Minimize Impacts to Business Owners

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