Before an eminent domain proceeding can begin in court, the government agency that wants to acquire a person’s property must produce a “resolution of necessity.”
The Fifth Amendment of the U.S. Constitution gives the government the authority to exercise the power of eminent domain as long as it provides just compensation to the owners of the property that it takes. As eminent domain law has evolved, “just compensation” has come to mean “fair market value.”
The most common cases of eminent domain land and buildings are taken to accommodate the construction of public projects, such as highways, parks, schools, railroads, and utility lines. But eminent domain may also involve the taking of airspace, water, dirt, timber, and rock appropriated from private land for use in construction roads. Eminent domain can even involve property interests such as leases, stocks, and investment funds.
Eminent domain is supposed to be the final method by which a government agency acquires the private property it needs for a public project. If the government needs property for a public use, the law of eminent domain mandates that it first try to obtain it by way of voluntary agreement with the owners rather than through the use of the government’s power of eminent domain.
Therefore, by law, before filing an eminent domain lawsuit, the government agency is legally required to take the following steps:
- It should submit a written offer to the owners of the property based on an appraisal of its value obtained by the government;
- It should propose a “resolution of necessity” stating that it needs the property for a public use and that the government’s offer has been refused;
- The law requires the agency to give notice of and hold a public hearing on the resolution; and
- If it determines that the resolution of necessity is justified, it would pass the resolution.
Unless extraordinary circumstances are shown, an agency’s finding that it needs a particular piece of property, the agency’s resolution of necessity is generally considered legally sufficient. Extraordinary circumstances would be such things as a gross abuse of discretion, fraud, or bribery.
Private property is taken through eminent domain proceedings. This will offer the owners the opportunity to challenge the legality of the seizure and settle the matter of the fair market value that must be paid in compensation for the taking.
What Must the Government Agency Show?
To adopt a “resolution of necessity,” the government agency must show the following:
- The property is necessary for a public project planned by the government agency;
- The property offers the best location for the public project;
- Taking the property proposed would result in the least possible harm to private property owners;
- An offer to purchase the property for a fair price was made to the owners, who rejected it.
Thus, a resolution of necessity is the government’s formal determination that it has been unable to acquire property needed for public use by way of a voluntary agreement with the owners and that it has become a “necessity” to use eminent domain instead to acquire the private property it needs.
The process of determining the necessity of a taking depends on state law. In most states, the process would include a public hearing, and it would offer the property owner the opportunity to challenge the justification offered by the government agency.
Some examples of how states necessity are as follows:
- California: Government agencies in California that seek to take property through eminent domain must adopt a formal resolution of necessity at a public hearing. This must be done before the agency files its eminent domain action. The resolution should only be granted if the agency proves that the taking is for a public project that is located so as to offer the most public benefit with the least private detriment;
- Illinois: Agencies requesting land through eminent domain must prove (and may submit evidence showing) that “the acquisition of the property is necessary for a public purpose.” Any party to such an action may submit evidence of any benefit to the landowner, any unsafe or illegal conditions of the property, the effect of such conditions on the property’s market value, and the reasonable cost of improving such a property;
- New York: When the government wants to acquire property in New York state, it must hold a public hearing at a location that is reasonably close to the property it wants to acquire. The agency must also publish a notice of the day and time of the hearing in at least five successive issues of an official daily newspaper of record in the area of the property.
What Happens After the Resolution of Necessity Is Shown?
If a government agency is able to show that taking a person’s property is necessary, then it obtains the required resolution of necessity. The case heads to court, where a judge or jury decides the issues presented.
First, the government agency must file its eminent domain case and accomplish service of process on the property owner. The law requires the agency to deposit the amount of just compensation that is probably with the court. The agency may make a motion in court requesting early possession of the property, i.e., possession before the conclusion of the eminent domain action.
The government agency and the property owner then participate in the discovery phase of the lawsuit. There may be depositions, e.g., of property appraisers, document production, interrogatories, and the like.
Of course, one of the main issues is determining the fair market value of the property the agency seeks to acquire. It is likely that both the property owner and government would hire appraisers to offer opinions as to the “fair market value” of the subject property.
In the course of the discovery process, the property owner and government would each share their appraiser’s report with the other party. As the trial approaches, the parties would make their final demands and offers for settling the case. There may be a settlement conference supervised by the court. This depends on the rules of procedure of the court in which the case is filed.
If the government agency and the property owner cannot agree on a settlement, then a trial of the eminent domain action takes place before a jury. The jury’s role is to determine the “fair market value” of the subject property.
When the jury returns its decision, a “verdict,” in legal terminology, judgment is entered. The government must pay the judgment to the property owner within 30 days after the judgment is entered. Once the fair market value is paid, the court transfers title to the subject property to the government by the court.
Do I Need a Lawyer?
If a government agency wants to take your property through eminent domain, you need to consult a real estate lawyer. LegalMatch.com can connect you to a lawyer who understands the eminent domain process and can ensure that any resolution of necessity is sufficient to justify the taking. Your lawyer can also ensure that you receive the full fair market value of the property in exchange for title.
