Eminent Domain

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California High-Speed Rail Project

The lawyers at Turner Law are familiar with the California High-Speed Rail Project (“project”). Andy Turner has been the featured speaker at numerous meetings before community groups, realtors, appraisers and attorneys, on eminent domain as it relates to the project. He has given numerous presentations in the Bay Area, the City of Madera and the City of Fresno. Attached is the PowerPoint used at one of those presentations (Presentation). Turner Law is currently representing property owners in Madera and Fresno Counties against the State of California which is acquiring property for the California High-Speed Rail Authority (“Authority”) for its project.

The project includes an estimated 800 miles of track and up to 24 stations. The currently proposed project segments are as follows:

  • > San Francisco – San Jose
  • > San Jose – Merced
  • > Merced – Fresno
  • > Fresno – Bakersfield
  • > Bakersfield – Palmdale
  • > Palmdale – Los Angeles
  • > Los Angeles – Anaheim
  • > Los Angeles - San Diego
  • > Sacramento – Merced

Construction of the project has started. Construction Package 1 (CP1) construction area is a 29 mile stretch between Avenue 17 in Madera County to East American Avenue in Fresno County. Construction Packages 2 and 3 extend from 1,000 feet south of East American Avenue to 1 mile north of the Tulare County line. Construction Packages 4 is from 1 mile north of the Tulare County line south to Poplar Avenue in the City of Shafter. (http://www.hsr.ca.gov/docs/newsroom/fact%20sheets/CV_Factsheet_FINAL_082015.pdf)

The Authority’s Draft 2016 Business Plan provides that the Silicon Valley to Central Valley Line (San Jose – North of Bakersfield) will be the first line constructed. (http://www.hsr.ca.gov/docs/about/business_plans/DRAFT_2016_Business_Plan_0201816.pdf)

Below are the Authority’s currently published Right of Way Exhibits for CP1which depict its proposed acquisitions for CP1.

Exhibit Avenue 17 to San Joaquin River: (http://www.hsr.ca.gov/docs/programs/private_property/ROW%20Exhibits%20Ave.%2017%20to%20San%20Joaquin%20River.pdf)

Exhibit San Joaquin River to Route 41: (http://www.hsr.ca.gov/docs/programs/private_property/ROW%20Exhibits%20San%20Joaquin%20River%20to%20Route%2041.pdf

Exhibit Route 41 to East American Avenue: (http://www.hsr.ca.gov/docs/programs/private_property/ROW%20Exhibit%20-%20Route%2041%20to%20East%20American%20Ave.pdf)

Owners in the path of the project need to be prepared. Why? Because there is only one chance to obtain just compensation from the State for its taking and the impacts from the project. The law in California is that “[a] condemnation award must once and for all fix the damages, present and prospective, that will accrue reasonably from the construction of the improvement…” People ex rel Dept. of Public Works v. Silveria (1965) 236 CA2d 604, 621-622.

How do you prepare? First, whether it is from Turner Law or another law firm, it is our recommendation that you seek the assistance of counsel with significant eminent domain experience.

After reading the Authority’s “Your Property, Your High-Speed Rail Project” pamphlet (Pamphlet) one may get the impression that, with the help of the Authority’s Relocation Specialists, Right-of-Way Agents and Appraisers, the Authority will make certain that the impacted owners are fairly compensated and that legal assistance is unnecessary. We do not think that this is true. The Turner Law attorneys have over 70 years experience in eminent domain litigation and only rarely have we found the condemning agencies’ appraisers’ opinions of just compensation are as much as the opinions of valuation consultants who have been retained by our clients. We recommend that owners work with their eminent domain counsel in retaining an appraiser and any other necessary consultants to make their own determination of the amount of just compensation that they should be paid by the Authority.

The owners of the property interests acquired for the project are entitled to be paid the fair market value of the property taken and possibly, depending on the circumstances, severance damages, loss of goodwill and relocation benefits.

The issue of severance damages will come into play if the taking is only a portion of the larger parcel, e.g., 50,000 square feet of a 500,000 square feet larger parcel is acquired.

Severance damage is defined as follows:

“Damage to the remainder…caused to the remainder by either or both of the following:

  1. (a) (a) The severance of the remainder from the part taken.
  2. (b) (b) The construction and use of the project for which the property is taken in the manner proposed by the plaintiff whether or not the damage is caused by a portion of the project located on the part taken.” (CCP Sec. 1263.420.)

It is easy to imagine that with this project there will be significant issues relating to severance damages. These issues might include impacts such as noise, vibration, aesthetics, impairment of access, size and shape of the remainder, loss of usability, loss of permits, etc.

If there are benefits to the remaining property caused by construction and use of the project, the amount of those benefits must be offset against the severance damages and the recoverable loss of goodwill, if any. Benefits cannot be offset against the fair market value of the property taken. (CCP Secs. 1263.410(b) and 1263.430.)

The owner of a business conducted on the property taken, or on the remainder if the property taken is part of the larger parcel, may be entitled to recover loss of goodwill under the eminent domain law. Goodwill is “the benefits that accrue to a business as a result of its location, reputation for dependability, skill or quality, and any other circumstances resulting in probable retention of old or acquisition of new patronage.” (CCP Sec. 1263.510 (b).)

Additionally, persons, businesses and farm operations that move from the property as a result of acquisitions for the project will be entitled to Relocation Assistance. (Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970 42 USC Sec. 4601 et seq., California Relocation Act, Govt. Code Sec. 7260 et seq.)

The above information is intended to be only a very brief summary of the applicable law and some of the issues that may arise in takings by the Authority. An owner who is threatened by a proposed condemnation of property should contact his or her attorney for advice regarding the law and procedure which is applicable to that particular situation.