Eminent Domain
     protect your land

When TXDOT and other governmental entities want to take your property through eminent domain, they work for the project not for you.

Showalter Law Firm will use our database, information and experience with thousands of clients in property matters to help you level the playing field. Our strategies for proving value impairment are designed to obtain your maximum reasonable recovery. The firm utilizes a team of highly qualified professionals experienced in real estate appraisal, land use and economic factors affecting property owners.

Each parcel of land is unique. Your property can not necessarily be valued by comparing the sales prices of other properties. You must analyze the highest and best uses of your property, present land use plans that evidence feasible uses, and consider the effect of taking your property on the rest of your property. You must also consider issues of relocation expense and business disruption.

To protect your interests, it is vital that you begin now formulating a strategy for dealing with the taking of your property. Call the Showalter Law Firm now to obtain representation and protection of your rights.

EMINENT DOMAIN:Texas Landowner's Bill of Rights
TRANS-TEXAS CORRIDOR: Showalter Law Firm Response to Environmental Statement
TRANS-TEXAS CORRIDOR: Texas Farm Bureau Firm Response to Environmental Statement

Showalter Law Firm Principal, David W. Showalter presented the following
Eminent Domain information at the Corridor Watch Workshop in Austin, Texas
in 2006.

I. Source of the Power to Take Private Property

      Taking private property by public entities, without consent of the landowner is the exercise of the power of 'eminent domain.'  This process is set our in Chapter 21 of the Texas Property Code.  The Property Code embodies what our legislature has deemed sufficient to satisfy landowners' due process rights as guaranteed by the State and Federal constitutions.  This process is known as "condemnation."

      The First Amendment the United State Constitution provides in part that private property shall not be taken for public use, without just compensation.  Further, Article I, Section 17 of the Texas Constitution provides that, "no person's property shall be taken, damaged, or destroyed, or applied to public use without adequate compensation being made...".  As stated above, the Texas Property Code outlines the procedure for taking private property for public use. Under the Federal Constitution, "due process" must be insured and "just compensation" is required to be paid to the owner.  Under the Texas Constitution, this is couched in terms that "adequate compensation" must be rendered.

      The power of eminent domain is vested in the Legislature.  The Legislature is empowered to name corporations, persons, and municipalities to institute condemnation proceedings.  Condemning authorities include the United States, the State of Texas, counties, municipalities, municipal utility districts, water authorities, electric utilities, pipelines, transmission companies, levy improvement districts, drainage districts and others.

II.  Restrictions on the Power of Condemnation

     The power of condemnation is said to be constrained by four factors.  Two of these restrictions result in little practical protection for the landowner.

Condemnation is subject to these four restraints:

            1.  Public Use.  Private property may not be taken without justifying a public purpose.  Defining "public use" has typically been decided on the merits of each case.  Generally, if the public receives some right or use in the business or undertaking to which the condemned property is devoted, the Courts have found the "public use" criteria satisfied.  As the result of the furor surrounding the Kelo vs. City of New London decision by the United States Supreme Court, the Texas Legislature passed a new statute which on its face appears to limit the power of governmental or private entities to use eminent domain to take private property.  The statute specifically appears to limit the taking of property to confer a private benefit on a particular private party.  The statute also purports to limit the taking of private property when the public use is merely a pretext to benefit a particular private party.  The statute also seeks to limit condemnation for purely economic purposes.

     Unfortunately, like most statutes which purport to protect the public, this statute is riddled with exceptions.  It does not limit the authority of numerous entities to take private property when the project involves:

    * sports and community venue projects approved by voters after December 1, 2005
    * waste disposal projects
    * utility services
    * water supply, wastewater, flood control and drainage projects
    * port authorities, navigational districts, conservation or reclamation districts
    * transportation projects

    Consequently, the statute has an exception big enough through which to drive the Trans-Texas Corridor.  All the politicians who took credit for championing the rights of private property owners routinely fail to mention this hot-button exception.

            2.  Public Necessity.  "Public necessity" relates to the amount of land that can be condemned and imposes a theoretical limit on the legislature.  The Legislature may not authorize, and the condemnor may not legally condemn more property than is reasonably required to serve its public use.  However, the condemnor's determination of the necessary amount of the property, as well as the location, is conclusive in the absence of fraud, bad faith or gross abuse of discretion.  This results in entities like the City of Houston's Metro taking prime locations along its light rail line to sell or lease to developers.  In essence, condemning authorities are substituting their own bureaucratic judgment for the forces of the market with a build-it-they-will-come mentality.  This displaces private property owners and deprives them of the appreciation that may accompany transportation projects.

            3.  Just or adequate compensation.  Adequate compensation for every right that is being taken must be made by the condemning authority.  "Adequate Compensation" under the Texas Property Code is expressed in terms of “market value.”  Cases define market value as the price property will bring in a offer for sale by one who desires to sell, but is not obligated to sell, and is bought by one who desires to buy, but is under no necessity of buying.  Market value is not limited to the current use of the property.  Rather, Texas law allows the landowner to recover the highest and best use to which the property can reasonably be adapted.

            It is important to determine whether all of an owner's tract is being condemned or only a portion of his property is being taken.  When a partial taking occurs, the statute considers 1) the value of the parcel being condemned, 2) the damage to the remainder (also called special damages) and 3) the benefit to the remainder (sometimes called special benefits).  The court determines the final award by adding the market value of the condemned land to any special damages and subtracting any special benefits.

            4.  Due Process.  Due process is a right guaranteed by the State and Federal Constitutions.  The concept of due process appears throughout American jurisprudence, and essentially requires that persons whose rights may be affected must be provided reasonable notice and a reasonable opportunity to be heard in order to present a claim or defense.  The Texas Property Code generally addresses the due process guarantee in three phases of the condemnation process:

            1.  Informal non-judicial negotiation between the condemnor and the condemnee;

            2.  A hearing before a panel of special commissioners and the resulting award; and,

            3.  The appeal from the special commissioners' award.

III. Steps Through the Condemnation Process

            The condemnation process is convoluted, confusing and fraught with nuances which are frequently exploited by condemning authorities to the detriment of the landowners.  Landowners must be wary at each phase of the process to fully protect their rights.

Here are the steps of the condemnation process:

            1.  Condemnor makes a "bona fide" attempt to purchase the property.  Typically, the condemnor provides an appraisal upon which its offer is based.  The appraisals tend to be biased in favor of the condemnor by the selective use of comparable values.  Further, the condemnor often leads the property owner to believe that there are no effective alternatives to accepting the offer.  Landowners are told that it is not necessary to obtain counsel.  Under current law, virtually any offer constitutes a "bona fide" attempt to negotiate market value. Landowners sometimes achieve limited beneficial results by negotiating a settlement at this initial stage of the process.  Typically, it is best to reject the condemnor's first offer.

            2.  When the condemnor's offer is rejected, the condemnor commences the formal condemnation process by filing a petition with either the county court at law or the district court.  The petition must describe the land, state the purpose for which the land is being condemned, name the owners and state that the parties have been unable to agree on damages.

            Promptly after the petition has been filed the judge will appoint three disinterested landowners in the county as special commissioners.  The special commissioners are sworn to assess damages fairly and impartially.  They set a time and place for hearing at the earliest practicable day and in a location near the property in question.  Each interested party is entitled to at least ten (10) days notice of the hearing.  The only issues the special commissioners can determine are market value, special damages, and special benefits.  The propriety of the taking cannot be questioned at this hearing.  Both parties frequently put on evidence through appraisers and witnesses to support their respective positions regarding market value.  The special commissioners then document their decision in writing and file it with the court.  Many times the award provides the landowner additional leverage in negotiating a satisfactory settlement

            3.  Either party may object to the award by filing written objections with the court.  The objections must be filed no later than the first Monday following the 20th day after the filing of the special commissioners' award.  If objections are not timely filed, the award becomes final and unappealable.  Consequently, it is critical for the landowner to comply with this deadline.  Once objections are filed the matter proceeds as a typical lawsuit, a condemnee who files objections to the award must, with reasonable diligence, issue and serve citation upon the condemnor.  If a landowner fails to serve the citation with reasonable diligence, he abandons his objections to the award as a matter of law.  The court will then require the landowner to accept the commissioners' award.

        A jury trial may be requested.  The process is then governed by the Texas Rules of Civil Procedure.  The parties may employ all of the usual discovery techniques authorized by the Texas Rules of Civil Procedure.  These include depositions, written interrogatories, requests for production of documents, and requests for admissions.  Each party typically hires expert witnesses such as appraisers, land planners, engineers, environmentalists, and real estate brokers to establish market value and special damages.

       Evidence concerning the special commissioners' final award is not admissible.  The matter proceeds to trial, the judge enters a judgment, which may then be appealed by either party.  The parties must comply with the judgment once it becomes final and unappealable.

      The landowner is not entitled to recover attorney's fees or expert witness fees.  If the final award of the commissioners or the trial court is less than or equal to the condemnor's offer before the proceedings, the landowner must pay all court costs.  Conversely, if the award of the commissioners or trial court is more than the condemnor's offer, the landowner recovers its court costs (not including attorney and appraiser fees).  Court costs typically includes: court reporter's charges, filing fees, and subpoenas.

IV. Losing Possession of Your Land

      The condemning authority is entitled to take possession of the land any time after the commissioners file their award, even if the award is being appealed.  Upon payment of the commissioners' award into the court registry or to the landowner, the condemnor is entitled to take possession and if necessary, evict the owner.  This is true even though the dispute regarding value is not resolved.  By accepting the payment, the landowner waives the right to protest the propriety of the taking as well as any prior procedural irregularities.  However, the landowner does not forfeit the right to prove that the amount of the award is inadequate.

V. Observations on the Trans-Texas Corridor and the Changing Face of Eminent Domain

 

      Significant changes are underfoot in the world of eminent domain and highway construction.  We are seeing firsthand a dramatic shift in the management  of the power of eminent domain by public officials and agencies.  This power is being used to exploit real or perceived value that is inherent in our property and transportation assets.

The State has turned over a new leaf and is looking at projects with an entrepreneurial zeal never before seen.  Transportation Department Commissioners are explicitly setting out to "extract the value from the dirt."

We are seeing the "Wal Martization" of our highway system.

The State may employ options to tie-up property.  This increases the potential loss to the landowner because the payment for the land is deferred.  Of greater concern is the potential for fraud or misleading of the landowner as to the identity of the actual purchaser.

Condemning authorities are not required to advise landowners to seek counsel.  This prejudices the ability of the landowner to obtain just and fair compensation.  The process is very complicated.  The landowner is subject to intimidation and the feeling that you "can't fight city hall."  Landowners are told they do not need counsel, even though the State has extensive resources and information available to it which it does not share with the landowner.  Landowners are lead to believe they do not have options beyond accepting the State's offer.

Kelo v. City of New London emboldened condemning authorities to use the power of eminent domain in unheard of deals to generate funds to finance construction.  Examples include: selling toll roads to private investors for up-front cash; expanding the use of toll roads; and granting concessions to investors to finance the acquisition of property and construct roads.