FAQs About North Carolina Eminent Domain and Condemnation Proceedings

Many people have questions about the eminent domain process in North Carolina. The Tarheel State is one of the only remaining jurisdictions with a “public use” eminent domain requirement. For many years, public use was mostly public works projects. Then, in 2005, the Supreme Court expanded this category to include some private development projects, such as rejuvenating a downtown area. As a result, the state and its bedfellows have unprecedented power to seize private property.

In these matters, a Charlotte land condemnation attorney is mostly a negotiator. Once the state launches eminent domain proceedings, it’s impossible to stop them, at least in most cases. However, the price the state must pay is a different matter. Rather understandably, the state wants to pay the minimum amount possible. An attorney ensures that you get fair compensation for your lost property rights.

There is not much of a difference and these terms are basically interchangeable. Eminent domain is the constitutional power to seize private property for public use, provided that the seizing agency pays just compensation to the property owner. Land condemnation is the act of transferring title from a private owner to a state agency. The state may also use its police power to condemn hazardous property, such as property used for illicit purposes or property that creates a danger to health or safety. That is separate from eminent domain. In most cases, these owners are not entitled to compensation.

Almost all eminent domain seizures are related to infrastructure projects, mostly road and bridge projects. Others include parks, lakes, rivers, and energy projects, like pipelines and utilities. Sometimes, the state takes an entire plot of land. Other times, the state adds a utility or other easement on the title. The state must pay just compensation.

First, let’s look at what just compensation is not. It is not what the state says it is. More on that below. Furthermore, just compensation is not necessarily the same thing as current fair market value. Instead, just compensation is based on the highest and best use of the land. For example, an undeveloped tract of land in a growing area might have an HBU (Highest and Best Use) value that is two or three times its current fair market value.

If the condemnor (state agency trying to take the property) and current owner cannot agree on the amount of just compensation, an “independent commission” often evaluates the property and makes an offer. We put this phrase in quotation marks because, in most cases, the commission is not independent. The condemnor usually handles the logistics, and the condemnor naturally uses this chance to build a rapport with commissioners. Then, after hearing the landowner’s side of the story, the commission usually sets a sales price. If the condemnor deposits this money into an escrow account, the land seizure proceeds.

HBU value and the type of taking usually determine the amount of just and adequate compensation. HBU value is seldom the same as market value. Infrastructure projects and population expansion almost always increase land value, especially if the land is currently undeveloped. The compensation must reflect this amount as opposed to the current market value. If the condemnor wants to take the entire tract, the landowner is entitled to the entire value of the property. If a condemnor wants an easement, the condemnor must only pay a fraction of the HBU value.

Experience is usually the most important factor to consider. Land condemnation proceedings are quite unique. The legal battle is over the price of the land, as opposed to the sale itself. So, in many cases, these matters come down to an attorney’s negotiating ability. Dedication is a related quality. Since this area of law is so different, you do not want a lawyer who treats land condemnation like a sideshow. Finally, consider the attorney’s accessibility. Your lawyer should be available to meet with you and answer your questions. But if a lawyer is not very busy and has an excessive amount of time to commit to your case, that is probably a bad sign.

The government cannot take private property for any purpose without paying just compensation. For a confidential consultation with an experienced land condemnation attorney in Charlotte, contact Arnold & Smith, PLLC. After-hours visits are available.