What Is Inverse Condemnation?

What Is Inverse Condemnation

To understand inverse condemnation, it’s best to understand condemnation cases first. Condemnations are real estate occurrences when a government entity – whether local, state, or federal – seeks to take property from a private owner via its eminent domain authority.

Inverse condemnation is also a real estate occurrence where a government entity takes private property for public use, and that use damages or lowers the property value. In these cases, the private property owner sues for just compensation by the condemnor that has taken the property for economic development, public improvement, or another feasible reason. The entity doing the taking has the legal right to do so through the law of eminent domain, but takes the property without first paying just compensation.

Eminent Domain vs Inverse Condemnation

Eminent domain refers to the government’s right to seize private property to use it to improve the public and for public use in some way, normally economically. Through the power of eminent domain, the entity seizing the property must provide reasonable compensation for the taking. Eminent domain does not, however, require the private property owner’s consent to take the property. In condemnation cases, the government initiates the taking while offering the property owner fair compensation. The property owner can accept the compensation offered or fight to increase the amount.

For example, the government may need to seize someone’s house and demolish it in order to build a highway over it. Eminent domain may be exercised as a complete, partial, or temporary taking of a property. Physical takings mean property owners will likely not have the same access to the property as they did before.

Inverse condemnation occurs when the government takes or damages property without first paying the required compensation. The landowner and not the government initiates an inverse condemnation action. These lawsuits require the following four elements:

  1. Proof of property ownership
  2. Participation by the government entity in a physical or regulatory taking
  3. Taking of and/or substantial damage to the property
  4. The damage was caused by the government’s actions

Example of Inverse Condemnation

The owner of the property being seized is, by law, entitled to be compensated for the property’s fair market value. For example, if a town wants to make one of its main roads wider, this could require the taking of a home or business’s driveway and sometimes part of the building itself.

Inverse condemnation occurs when the owner of the home or business is paid the fair market value for the taking of their property but argues the damage to the property is worth more than the fair market value or the compensation being offered. Generally, a property owner will claim the partial seizing has made it impossible to run the business or live properly or safely on the property, which is why they deserve more compensation. The property owner will often claim they deserve to be compensated for the entire value of the property and/or building.

Types of Inverse Condemnation Claims

The common types of inverse condemnation claims include a landowner being deprived enjoyment of their property due to:

  • Seizing and Damaging Property: The government seizes or constructively seizes and damages private property.
  • Physical Appropriation: When the government physically takes possession of a property interest for a public purpose.
  • Exactions: Instances where the government requires a property owner to trade money or other development concessions like land for the government’s approval or permitting.
  • Regulatory Takings: When the government over-regulates a property to the extent that it cannot be used.

Situations Where You Might Have a Valid Inverse Condemnation Claim

To make an inverse condemnation claim valid, there are a few things to keep in mind. If there was road construction, projects for flood control, or regulation that deprives a landowner of the use of their property, these scenarios be make for strong cases that the compensation a property owner received was not equal to the value of the damage the taking caused.

Even if the additional damage is excessive noise from nearby airports, railroads, or roadways, you may have a valid inverse condemnation claim. Other common valid inverse condemnation claims include difficulties accessing and using the property as well as having pipelines or powerlines crossing the property.

How Our Eminent Domain Attorneys Can Help Texas Landowners

If you are a Texas property owner who has been notified of a condemnation or partial taking of your property, you should seek the advice of an experienced eminent domain attorney. If you find yourself wondering if the compensation you will receive or have received for condemnation is not fair market value and/or not equal to the damage caused to your property or your business, you may have a strong inverse condemnation claim. There is nothing more frustrating than finding your business struggling from lack of parking due to a government entity taking your land.

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