Eminent Domain FAQs

What is eminent domain, and what is condemnation? 

Eminent domain is the power to take private property for public use. Condemnation is the legal process by which the power of eminent domain is exercised. Under the Texas and United States Constitutions, the government, or any entity with the power of eminent domain, must pay just compensation for the portion of property that is taken, and it must show that the taking is necessary for public use.

How do I find out how much the condemning authority is willing to pay me?

Condemning authorities are required to make Initial and Final Offers and to provide the landowner with an appraisal of just compensation.  Although the Texas and U.S. Constitutions mandate that the landowner receive “adequate” or “just” compensation, in many instances, the condemning authority’s opinion as to what that compensation should be is far below what Texas law and market evidence requires. If a settlement can’t be reached after the offers and appraisal are provided, then the condemning authority can ask the Court to appoint three Special Commissioners to resolve the issue of just compensation at a contested hearing. If either side is dissatisfied with the decision of the Special Commissioners, then either side can appeal and request judge or jury to determine how much the condemning authority must pay.

What criteria should I consider in selecting an eminent domain attorney?

Important considerations when hiring an attorney for an eminent domain matter are:

1. Does the attorney handle eminent domain cases on a regular basis or only occasionally?
2. Does the attorney know how to evaluate appraisers and appraisal reports?
3. Will the attorney be compromised by any current or potential work for the government, including representing the government in takings on other projects?  
4. Will the attorney hesitate to take a case to trial?  
5. Does the attorney know how to develop a trial strategy and has the attorney taken an eminent domain case to trial in the past two years?

Why do people decide not to hire an eminent domain attorney? 

There are several misconceptions that cause landowners to forgo hiring an eminent domain attorney:

1. They think they have no other options.
2. They do not realize the offer is too low.
3. They don’t want to appear greedy or to seem against the public interest.
4. They think hiring an attorney costs more in the long run.
5. They think hiring an attorney will make the eminent domain process more stressful or require them to testify at trial.

What is the Landowner Bill of Rights?

According to Sec. 402.031 of the Texas Government Code and Chapter 21 of the Texas Property Code, landowners have the following rights when any government or private entity attempts to take property in Texas State Courts:

1. Right to adequate compensation for property taken for public use.
2. Right to only have your land taken if it is for public use.
3. Right to only have property taken by a government entity or private entity authorized by the government.
4. Right to be notified of an interest in taking your property.
5. Right to be provided with an assessment of fair compensation for your property.
6. Right to get a good faith offer from the entity proposing to buy the property before that entity files a lawsuit condemning your property.
7. Right to hire an appraiser to determine the value of your property.
8. Right to hire an attorney to negotiate on your behalf and represent you in legal proceedings related to the eminent domain proceedings.
9. Right to a hearing before a court-appointed panel of 3 special commissioners before your property is condemned to have the issue of just compensation decided.
10. Right to take your case before a judge or jury if you the commissioners’ decision is unsatisfactory or if you believe the taking of your property didn’t follow proper procedures.
11. Right to appeal a court’s judgment.

Given eminent domain laws and the Landowner Bill of Rights, can I assume that the government will treat me fairly?

No. The government is no different from any other buyer of real estate. It wants to buy property as cheaply as it can. The government has no obligation to look out for a property owner’s interests. Like any real estate buyer, the government wants to pay the lowest price.

Will talking to the government’s agents, like their right-of-way agents or appraisers, help me? 

Usually not.  It’s best to avoid discussing your property with the government’s agents as they are aligned with the government, who wants to obtain your property as cheaply as possible.  Spend your time asking questions that you need answered rather than sharing specific information about your property.

Given the government is required to pay me the fair market value for my property under the eminent domain rules, shouldn’t I just accept the offer given to me?

No. Fair market value may vary dramatically depending upon choices that the government’s appraisers make based on their limited knowledge of your property. Too often they select properties that are not truly comparable to yours, or do not make proper adjustments to account for the differences.  Taken together, this explains why many landowners are not satisfied with the “bona fide offer process” in Texas.   Always remember that the government is no different from any other buyer of real estate. It wants to buy property as cheaply as it can.

Should I receive extra compensation if the government’s eminent domain acquisition causes my remaining property to become nonconforming with zoning ordinances, for example, setback requirements, lot coverage ratios, parking requirements, etc.? 

These issues require the analysis of an experienced eminent domain attorney and related experts such as appraisers and land planners. 

Can the government take my business under eminent domain?

Not exactly. If your business is on the property area marked for a public project - like highway construction or redevelopment - the government can take the property on which your business is located and require your business to be relocated.  In this case, the government does not take ownership of the business itself. However, in many cases, losing the building, the property and the location seriously impacts the continued operation of the displaced business.

What if I still owe the bank money on the property being taken? 

If you're like many people, you may have a loan, mortgage, or equity line of credit on your property. This debt complicates the eminent domain process because your lender usually has the right to get paid before you do. But, there are solutions. An experienced attorney can try to help ensure that banks do not cause needless delay, and that you are treated fairly. For example, disclaimers of interest, full or partial waivers, full or partial payoffs, or refinancing of the loan are all viable options that an experienced attorney can facilitate to simplify the eminent domain process and ease the burden on their landowner client.