236.10 Right Of Way Condemnation: Difference between revisions
→236.10.7.5 Appraisal, Waiver Valuation and Written Offer (RSMo 523.253): updated per RR3676 |
m →236.10.7.3 Alternative Location Proposals (RSMo 523.265): updated per RR3693 |
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===236.10.7.3 Alternative Location Proposals ([http://revisor.mo.gov/main/OneChapter.aspx?chapter=523 RSMo 523.265])=== | ===236.10.7.3 Alternative Location Proposals ([http://revisor.mo.gov/main/OneChapter.aspx?chapter=523 RSMo 523.265])=== | ||
With regard to property interests acquired by condemnation or negotiations, the landowner may propose an alternative location for the property to be condemned to the condemning authority. The alternative location proposal is to be made in writing to the condemning authority, and is to be received by the condemning authority within thirty days of the landowner’s receipt of a [https://epg.modot.org/forms/RW/Chapter%2010_Condemnation%20Procedures/Written%20Notice%20of% | With regard to property interests acquired by condemnation or negotiations, the landowner may propose an alternative location for the property to be condemned to the condemning authority. The alternative location proposal is to be made in writing to the condemning authority, and is to be received by the condemning authority within thirty days of the landowner’s receipt of a [https://epg.modot.org/public_html/forms/RW/Chapter%2010_Condemnation%20Procedures/Written%20Notice%20of%20alternative%20Location%20and%20Design.docx Written Notice of Alternative Location and Design Letter (Form 236.10.7.3B)] sent under Section 523.250. Further, the alternative location proposal is to be on the same parcel of the landowner’s property that the condemning authority seeks to condemn, and be in such detail that the alternative location is clearly defined for the condemning authority. This section does not apply to acquisitions of an entire parcel of land. | ||
The condemning authority will consider all such alternative location proposals. A written statement containing the following is conclusive evidence that sufficient consideration was given to alternative location proposals. Therefore, to be found to have engaged in good-faith negotiations during condemnation proceedings, the condemning authority must provide a written statement to landowners who propose alternative locations. | The condemning authority will consider all such alternative location proposals. A written statement containing the following is conclusive evidence that sufficient consideration was given to alternative location proposals. Therefore, to be found to have engaged in good-faith negotiations during condemnation proceedings, the condemning authority must provide a written statement to landowners who propose alternative locations. The written statement '''must''' include the following: | ||
* that the alternative location has been considered, AND | * that the alternative location has been considered, AND | ||
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MoDOT's written response to alternate locations must be made to the affected landowner within two weeks (10 working days) after MoDOT receives the landowner's counter-proposal. | MoDOT's written response to alternate locations must be made to the affected landowner within two weeks (10 working days) after MoDOT receives the landowner's counter-proposal. | ||
If a parcel goes to condemnation, MoDOT must be able to prove that it has engaged in good-faith negotiations. The law | If a parcel goes to condemnation, MoDOT must be able to prove that it has engaged in good-faith negotiations. The law allows the property owner to submit an alternate location for the improvement project and requires MoDOT consider that alternative. Property owners have up to 30 days after they receive the [https://epg.modot.org/public_html/forms/RW/Chapter%2010_Condemnation%20Procedures/Written%20Notice%20of%20alternative%20Location%20and%20Design.docx Alternative Location and Design Letter]. | ||
District right of way staff will send the 60-day notice, Form 236.10.7.3A (04/04/2023), to all property owners once right of way plans have been approved. | |||
The right of way manager must be provided with copies of any rejection and acceptance letters sent to property owners who submit an alternate location proposal. Copies of these letters will be used during the condemnation process to prove that MoDOT has engaged in good faith negotiations. | Since condemnation is uncertain at the time right of way plans are approved, MoDOT will provide the [https://epg.modot.org/public_html/forms/RW/Chapter%2010_Condemnation%20Procedures/Written%20Notice%20of%20alternative%20Location%20and%20Design.docx Alternative Location and Design Letter] and [[media:236.18.8_60_Day_Notice_Letter_for_LPAs.doc|60 day Notice of Intent to Acquire Letter]] written statements to all property owners, or potential property owners, who submit alternate location proposals. | ||
The right of way manager must be provided with copies of any rejection and acceptance letters sent to property owners who submit an alternate location proposal. Copies of these letters will be placed in the parcel owners file and be used during the condemnation process to prove that MoDOT has engaged in good faith negotiations. | |||
===236.10.7.4 Written Notice ([https://revisor.mo.gov/main/OneSection.aspx?section=523.250&bid=28018&hl= RSMo 523.250])=== | ===236.10.7.4 Written Notice ([https://revisor.mo.gov/main/OneSection.aspx?section=523.250&bid=28018&hl= RSMo 523.250])=== |
Revision as of 11:47, 5 June 2023
236.10.1 Introduction
236.10.1.1 Scope
This information sets out the procedure and basic law relating to the exercise of the power of eminent domain in Missouri. It deals with procedure and the rules of evidence in determining the value of the property involved and the just compensation to which the owner of the property is entitled as a result of the taking of all or a part of the property for public use. Space does not permit a complete discussion of all of the ramifications which can develop from various fact situations presented by the physical features of the property involved and the proposed facility for which the property is taken. Argument and controversial aspects of damages, such as the numerous elements for which a property owner may or may not be compensated, which have not been resolved by statute or court decision, will be avoided. In this chapter the term "condemnor" adopted by the courts, is used to denote the agency or corporation authorized to exercise the power of eminent domain.
236.10.1.2 Authority To Exercise Power of Eminent Domain
The authority to exercise the power of eminent domain is inherent in the sovereign and no constitutional grant is necessary to its exercise. This right has been delegated by the Constitution and statues of the State to agencies of the State, such as municipalities, counties, Conservation Commission, State Highway Commission, State Park Board, colleges and universities, Board of Public Buildings, and to certain so-called public service corporations, such as railroads, water companies, power companies, telephone and telegraph companies, and pipeline companies.
When an agency of the State or a corporation seeks to exercise the power of eminent domain it must be able to show its authority to do so. The use to be made of the property must be a public one, and the purpose must be within the scope of authority or power of the condemnor.
236.10.1.3 Necessity
The authority to exercise the power of eminent domain carries with it the authority to determine the necessity for its exercise; that is, the exact location and route of the facility to be constructed and the amount of land necessary. This, of course, can be limited by the Legislature, as has been done in Chapter 523.100, RSMo 1994, and the requirement that certain public utility companies obtain a certificate of convenience and necessity from the Public Service Commission. Also, upon proper objection, the courts can inquire into whether or not the condemnor has abused its discretion in making the determination as to the amount land needed.
236.10.1.4 Public Use
Private property may not be taken for a private use except for a way of necessity and for drains and ditches. Condemnation of private property for any other purpose must by for a use which is considered to be public in nature. The condemning authority must allege its intention to devote the property to a public use, and the courts may go beyond this allegation to determine whether the proposed use is actually public. This does not necessarily involve a hearing of evidence by the court but the court may do so. The mere fact that the proposed facility ordinarily will be used by a limited number of people or that a single person might derive substantial benefit from the improvement does not render it private. Additional property may be acquired by the condemnor for a proposed future expansion of the facility to be constructed or for maintenance of the improvements. This does not permit the condemnation of property that could not possibly, under any circumstances, be utilized for the improvement.
When condemnation is necessary to acquire right of way for a project, approval and certification of the plans by the commission is required. See EPG 236.13.13.2 Right of Way Obtained by Condemnation for the steps to request the commission’s approval and certification of plans.
236.10.2 Condemnation Procedures
236.10.2.1 General Information
When property is to be acquired by condemnation, the procedure is prescribed in Chap. 523, RSMo 1994 and Sup. Ct. Rule 86. Under this procedure the condemnor may exercise the power of eminent domain if it cannot agree with owner of the property on the compensation to be paid, or if the owner is a nonresident of the State of Missouri, or is unknown or cannot be found, or if the owner is incapable of contracting. As between the condemnor and the property owners, there is one estate in the property although there may be several interests therein. The condemnor's taking, except perhaps for a temporary use, usually affects all interests in the property. Thus, if it cannot acquire by negotiation some of the interests which its taking affects, it may condemn all the interests affected, since one interest could not be utilized unless all interests affected are obtained. For detailed information concerning the process of acquiring property by the use of eminent domain see Eminent Domain Guidelines located at the end of this article.
236.10.2.2 Petition
When the condemnor has complied with all conditions precedent to condemning, it may file its petition in the circuit court of the county where the land, or a part thereof, lies. Numerous tracts may be joined in one petition. The petition must allege all conditions precedent to the condemnation, such as the condemnor's authority to condemn, the nature of the use to be made of the property, the condemnor's authority to construct the proposed facility, the inability of the condemnor to agree with the owners of the properties involved upon the proper compensation to be paid (or that the owner is incapable of contracting, cannot be found, is unknown or is a nonresident). The petition must also contain descriptions of the properties and rights sought to be acquired. If the condemnor intends to limit the rights it seeks to acquire to less than it is permitted by statute to acquire, this must be set out in the petition, otherwise the condemnor will acquire the right to utilize the property to the fullest extent permitted by statute. The petition should also allege that the governing body of the condemnor has authorized and directed the construction of the particular facility.
236.10.2.3 Service of Process
Parties (defendants) must be given not less than ten days' notice of the pendency of the proceeding. The summons must state the time and place, when and where, the petition will be heard for the appointment of commissioners. Service by publication one day a week for three weeks in a newspaper of the county where the petition is pending or by registered mail, may be had on persons who are not residents of the state or upon whom personal service for other reasons cannot be obtained. Request for service by publication or mail should be made in the petition setting out the reasons why such service is requested.
236.10.2.4 Responsive Pleadings
It is not necessary for the owners of the properties involved to make answer to the petition in order to have just compensation determined; however, an answer or motion must be filed to the petition in order to raise issues of jurisdiction. Thus, the owner, by responsive pleading, may question the condemnor's authority to condemn or to construct the particular facility or may question that the proposed use is a public one.
236.10.2.5 Appointment of Commissioners
At the time and place set, the court will consider the petition for the appointment of commissioners. The Court must dispose of issues raised by responsive pleadings prior to the appointment of commissioners. It is not required that the court hear evidence on the propriety and necessity for condemning the land. Matters relating to the location and design of the facility are legislative and not judicial in nature. All issues to be resolved prior to the appointment of commissioners are tried by the court without a jury.
Upon the court being satisfied with the sufficiency of the petition and that proper notice has been given to all parties and upon such issues as are raised by responsive pleadings being resolved in favor of the condemnor, the court shall appoint three commissioners to assess the damages resulting to the various tracts involved as a result of the proposed taking. The commissioners must be disinterested fee-holders and residents of the county where all or part of the land lies. In determining damages the commissioners shall take into consideration the benefits that result to the remaining property from which a part is taken as a result of the construction and maintenance of the proposed facility upon the land taken (the statute says only "benefits" but the courts have interpreted this as meaning that the benefits must be special. The distinction between general and special benefits will be discussed, later in this article). The commissioners shall view the property, determine the damages to which the owners are entitled and file two copies of their report under oath with the clerk of the court describing the property taken and setting out the sum awarded as damages as to each property. If all three commissioners fail to agree upon an award of damages, two of such commissioners may agree and sign the report with the same effect as if all three commissioners had agreed. The commissioners are required to separately assess the damages as to each tract which is under separate ownership, but are not required to determine the amount to which each of the various owners of one tract are entitled. One copy of this report is filed by the clerk in the office of the recorder of deeds for recording in the land records of the county.
In making their inspection and arriving at their conclusion as to the compensation to be awarded to the property owners, the commissioners are permitted considerable leeway. They are directed by statute to view the property. There is, however, no provision for the commissioners to hold hearings and receive sworn testimony. This allows the commissioners considerable informality and they are permitted to discuss the features of the taking with the property owners and with the condemnor and their respective representatives, and to gather information from any sources that they feel necessary for their use in arriving at their award. Any instructions to the commissioners which are necessary, or which they request, on legal points to enable them to carry out their duties should be given by the court.
236.10.2.6 Proceedings Subsequent to Report of Commissioners
Following the filing of the report of commissioners the clerk of the circuit court must notify the owners immediately of the various properties that the commissioners have filed their report. It is not necessary that this notice specify the amount awarded by the commissioners. Upon the report being filed, the condemnor may pay the amount of the award into the registry of the court. The date upon which the check is deposited with the clerk of the court is the date of taking. At this time title passes to the condemnor who may take possession of the property and construct the proposed facility, even though further proceedings may be requested by either party. Within ten days after receipt of notice of the payment of the award the owners shall surrender possession of the property condemned to the condemnor, and if the owner fails to do so, the condemnor may, upon application to the court, obtain a writ of possession from the court directing the sheriff to place the condemnor in possession of the property. The time for the surrender of possession by the owner may be extended for good cause shown for a period not to exceed ninety days upon application of the owner.
Within thirty days after the receipt of notice of the filing of the commissioners report, either party may file exceptions thereto and request a jury trial. If the award is not paid into court within thirty days, then the owners are entitled to interest at six per cent per annum on the amount of any subsequent verdict, or if no verdict, then on the amount of the award from the date of filing of the commissioners report. If the award is paid within thirty days and a subsequent trial results in a verdict for an amount greater than that awarded by the commissioners, the owner of the property is entitled to interest at the rate of six per cent on the excess of the verdict over the commissioners' award from the date of the filing of the commissioners' report until the judgment is paid. If the award is paid into court within thirty days and a subsequent trial results in a verdict of less than the amount awarded by the commissioners the condemnor is entitled to interest at the rate of six per cent on the decrease of the award from the date the award was paid into court until the judgment is paid. If the property owner has, however, not drawn down the commissioners' award, the property owner is not required to pay interest on any part not drawn down. The condemnor may abandon the proposed appropriation by filing a written election to do so within any time prior to the expiration of ten days after final judgment. If such election to abandon is not filed within thirty days after the commissioners' report is filed and the award made by the commissioners is not paid into court within thirty days after such report, then the court may, upon motion of the owner filed within ten days after filing the election to abandon, award to the owner interest on the award at the rate of six per cent per annum from the date of the filing of the commissioners' report to the date of the filing of the election to abandon. If the condemnor abandons a proposed appropriation, no new proceedings shall be instituted within a period of two years thereafter for the condemnation of the same property. This, however, does not apply if the abandonment is in good faith and is necessary as a result of a defect in the proceedings. All court costs up to and including the filing and recording of commissioners' report are taxed against the condemnor. Any subsequent costs are taxed by the court as justice requires.
236.10.2.7 Right to Jury Trial
If either party to a condemnation proceeding files exceptions and requests a reassessment of damages within the time provided, such trial is to be conducted as in ordinary civil cases involving damages. This reassessment shall be made under the supervision of the court and by a jury if requested by either party. Neither party can have new commissioners appointed to reassess the damages. Following the filing of exceptions, all proceedings subsequent to that relate only to the amount of compensation to which the owner is entitled. Until the time exceptions may be filed, the condemnation proceeding is treated as one case even though there may be numerous tracts of land and property owners involved. After the commissioners have made their report, each separate tract of land upon which exceptions are filed is treated as a separate case for trial.
236.10.3 Preparation For and Conduct of Trial
236.10.3.1 Preparation
Generally, considerable trial preparation will have been accomplished prior to the time exceptions to the report of commissioners are filed. This especially true as to the condemnor, which must conduct its affairs through its officers or agents. Because of this it is necessary that the condemnor rely upon the advice and opinions of others. Thus, when it is determined that a particular improvement or facility is to be constructed which requires the acquisition of property, it is reasonable to anticipate that it will be necessary to condemn some of such properties. In order for the agency or corporation proposing to construct the facility to successfully carry on its negotiations for the properties needed, it must make sufficient trial preparations that its officers will be in a position to know what evidence it can produce as to values and damages as to each specific property in the event condemnation should result. This is the only method by which officers of the agency or corporation can make a valid decision as to what price should be paid to the property owners or whether to proceed to condemnation. Therefore, the condemnor, in anticipation that litigation as to compensation may result, will generally have made at least basic preparation for trial prior to the institution of condemnation proceedings. This preparation prior to condemnation probably will not include the preparation of detailed plats and the making of necessary photographs, but should at the least involve retaining persons who can qualify as competent witnesses in court to make inspections and appraisals of the properties affected and the damages which will possibly result thereto from the taking.
The owner of the property usually personally conducts negotiations until the appointment of commissioners and frequently until the time for filing exceptions before the owner employs legal counsel. Thus, the lawyers employed by property owners will sometimes be found in such a position that if their clients are not satisfied with the commissioners' report the lawyers must file exceptions to protect the clients' interests even though it may be that later, in trial preparation, it is difficult or impossible to find competent witnesses who share the clients' views as to the damages resulting to the property.
Whether the attorney represents the condemnor or the property owner, the attorney's basic trial preparation should start at the earliest possible time. Such practice will not only protect the interests of the client, but in many instances will avoid litigation altogether. All such preparation is privileged against discovery by the opposing party.
Trial preparation should consist of appraisals of the property as it exists before and after the appropriation by persons who can qualify as competent witnesses, the preparation of plats and the making of photographs where necessary. The attorney should be familiar with the property to the greatest extent possible, and if the taking involves a part of the property only, the attorney should review the plan for the proposed facility to be constructed. Conferences should be held with the prospective witnesses so as to make certain that they are thoroughly familiar with the property and the plans for construction of the facility insofar as they affect the property remaining, as well as market conditions in the area. The witnesses' opinions as to damages or special benefits to the remainder should be reviewed thoroughly to make certain that the witnesses have considered all proper matters and that the witnesses' opinions have a sound basis and are predicated upon features which will be proper matters for consideration by the jury in its determination of value and damages or benefits.
In deciding whether or not plats, photographs and other visual aids are necessary, we should keep in mind that such items within themselves are not evidence, but are merely aids in presenting testimony and should be used only when they will aid in explaining various features to the jury. When visual aids are used, they should be connected to the testimony of a witness or witnesses.
236.10.3.2 Conduct of Trial
The trial is conducted as if no prior award had been made by the commissioners. The amount awarded by the commissioners is not admissible in evidence in the jury trial. However, the commissioners themselves (without being identified as such) may testify to value and the amount of damages may be the same as in the report, but the report cannot be entered as evidence. The trial is conducted in the same manner as one involving an inquiry into damages in an ordinary civil case. Since the owners of the property have the burden of proving the amount of damages which they will sustain as a result of the taking, they are entitled to open and close regardless of which party filed exceptions to the commissioners' report.
Where the entire property is taken, all evidence as a general rule will relate only to the value of the property taken, which is the amount to which the owners are entitled. If, however, a portion of the property is taken, the owners are entitled to the difference between the value of the property as it existed prior to the taking of a part thereof and the value of the remaining property. When this is the case it will generally involve evidence and consideration of the facility to be constructed since the owner is entitled to be compensated for any damage resulting to the remainder of this property as a result of the construction of the facility and the condemnor is entitled to have the jury give consideration to any special benefits to the remaining property which will accrue as a result of the construction of the facility.
The court may permit the jury to view the property involved. If this is done, the court must make such rules and orders as are necessary to properly supervise the conduct of the jury and the parties during such view. There are many instances where such a procedure might be of considerable benefit to the jury, such as where the property in question is difficult to describe to the jury and is still intact so that the jury in viewing the premises will get a clear picture of the property as it exists prior to the taking. There are also instances where a view of the property after the completion of the construction of the facility might be of benefit to the jury. This is true where only a part of the property is taken and there is a question as to the effect that the facility has upon the remaining property because of the plan of construction. Because of the problems encountered, the trial courts are reluctant to order a view of the premises by the jury. The procedure is time-consuming and involves the arrangement for transportation to take the jury to the premises. It also requires that the court give careful directions so that statements relating to the issues of the case will not be made to the jury by interested parties outside the normal trial proceedings. Any request, by either party that the court permit the jury to view the premises, should be made out of the hearing of the jury.
As is the case with commissioners, the jury should consider the property involved as one estate without regard to the numerous ownership's or interests therein and render a verdict in one sum. It is then left to the court to apportion the amount awarded among the various claimants.
236.10.3.3 Evidence of Value and Compensation
If the condemnation involves the taking of an entire parcel of land, the question to be determined by the jury is the value of the land as of the date of the taking. When the condemnation involves the taking of a part of a tract of land, then the question is the difference between the value of the entire tract prior to the taking of a part thereof and the value of the part remaining after the taking, which difference is the amount to which the owner is entitled as just compensation. Stated another way, the owner is entitled to the value of the land taken, plus any decrease in the value of the remainder of the tract caused by the taking. In the event of a partial taking the jury is also required to determine from the evidence whether or not there are any special benefits resulting to the remaining property from which a part is taken from the construction and maintenance of the proposed facility. The jury cannot take into consideration general benefits. General benefits are those benefits accruing to all owners of property in a neighborhood or vicinity that result from the construction and maintenance of the proposed facility. Examples of general benefits are: the public's right to enjoy a facility such as a park or public way or the improvement of the economy of a community generally by the construction of a facility. Evidence of such general benefits should not be submitted. The courts have defined special benefits as being those benefits accruing to a tract of land and resulting in an increase in its value because of its position directly upon, or adjacent to, the proposed facility. Examples of special benefits are: improved drainage, improved accessibility, availability of a service for use in connection with the property not previously enjoyed, and the availability of a facility which makes the adjacent property adaptable to a higher or better use, thereby increasing its value. A good example of the distinction between general and special benefits is found in the older railroad condemnation cases where the benefits derived by a community, generally from the construction of a railroad through it, thereby making transportation available to the community, is a general benefit; while the benefit a particular tract of land might receive by the construction of a railroad immediately adjacent to it, in making the land adaptable as a shipping and receiving point, thereby increasing its value, is a special benefit. The mere fact that other tracts of land located adjacent to the facility may receive the same benefit as the property in question does not make that benefit general in nature. However, such matters as increased traffic from the construction of an improved highway are not considered as special benefits to be offset against damages even though such increase in traffic may enhance the desirability of the property for commercial purposes.
When there is a question of damages or special benefits to the remainder of a tract of land, a part of which is taken, the facility to be constructed is to be considered by the jury insofar as it relates to, or has a bearing upon, the damages or special benefits to the remainder. The damages or benefits must be direct and such as can reasonably be expected to result from the taking and the construction of the facility. Only evidence of those elements which are sufficiently certain and definite as of the time of evaluation that they would influence a prospective purchaser of the property in arriving at the figure which would be paid for the property should be submitted to the jury. All evidence of damages and benefits to the remainder of the tract of land must relate to the value of the land. The converse of the rule that general benefits cannot be charged against the property owner is the rule that the owner is not entitled to compensation for inconveniences which the owner shares in common with the community generally as a result of the construction and use of the facility. However, courts have allowed general items of damages such as, noise, traffic, unsightliness, possible risk of explosion, inconvenience and loss of security and privacy to be considered in totality, as causing a diminution in market value, although no specific individual value was allowed to be assigned to any of these items.
The value of the property, whether it be its value prior to the taking or after, should be determined in relation to the uses for which the property is reasonably adaptable in the immediate future. Evidence of value which is purely speculative and based upon the happening of events in the future, which may or may not result, should not be permitted. Since in the larger metropolitan areas there is always a degree of speculation in the sale and purchase of vacant undeveloped land, we should not confuse such speculation, which is based upon expectancy of the continuation of the normal economic development and conditions, with the remote speculation that the property will become adaptable to some higher or better use because of some remote contingency which hinges upon the happening of events outside of the normal economic development and expansion. Although a particular use is prohibited by an existing zoning ordinance, if there is sufficient evidence of a reasonable probability that the zoning may be changed or an exception made to it so as to permit a higher use in the reasonably near future, the effect which the probability of rezoning has upon the value of the land in view of its present zoning may be taken into consideration.
Although evidence of the probability of rezoning is admissible, the property is not to be valued as though the rezoning is an established fact, but is to be valued in light of the effect that the probability of rezoning has upon the property. Evidence of the rezoning of other comparable property is admissible for showing a probability of rezoning. The mere proof of uses of nearby property without showing that the original zoning was altered to permit that use is not sufficient to show a probability of rezoning. The lack of rezoning is admissible to counter evidence of a reasonable probability of rezoning. Evidence of rezoning of similar property occurring subsequent to the taking may be admissible to show a probability of rezoning. However, the effect which the public improvement for which the property is taken has had or might have on the question of rezoning should not be considered.
A depressed value resulting from the knowledge that the property in the future is going to be taken for a public use should not be considered; just as an enhanced value resulting from the knowledge that a public improvement is going to be made should not be considered.
The suitability of land for a particular use is subject not only to the question of whether the land physically can be utilized for such purpose but also whether there is a demand for the property for that purpose in the market place.
The price which the property in question has sold for in the past, whether it be prior to or after the institution of the condemnation proceedings, is admissible as having some bearing upon the value of the property unless the sale was so remote in time, in reference to the condemnation, that the normal change in economic conditions would have resulted in the sales price being not representative of the value of the property at the time in question. Such evidence, however, is not conclusive as to the value of the property and in rebuttal, evidence of peculiar or unusual conditions surrounding the sale which had a bearing upon the sales price may be offered.
The price for which other property in the vicinity of the property in question has sold is admissible as having a bearing upon the value of the property in question. However, in order to avoid too many collateral issues coming into the case, the proponent of such evidence should first be required to establish that the property sold has a sufficient degree of comparability to the property in question and that it does have a bearing upon the value of the property in question. The trial court is permitted a considerable degree of discretion in whether or not such evidence will be permitted. It should be remembered, however, that the mere fact that the property that has sold is sufficiently comparable to the property in question that its sales price can be admitted by the court does not mean that such sales price is conclusive as to the value of the property in question. The weight of such evidence is still to be determined by the jury. When the sales price of other property is admitted in evidence the court should not thereafter comment on the comparability of such property to the property in question but should leave the weight of such evidence to the jury unless subsequent evidence should justify the striking of the sales price previously admitted.
Although the sales price of properties that are comparable to the property in question may be admissible in evidence, the price which the condemnor has paid for other properties should not be admitted. The reason for this rule is very simple in that such sales are not conducted in the usual and ordinary course of business. When the condemnor purchases property, as a general rule, it is compelled to purchase the particular property, abandon the proposed facility or exercise its power of eminent domain. The property owner is compelled either to sell the property or take a chance in court in a condemnation proceeding. Because of this the parties are frequently inclined to compromise and agree upon a price that is not entirely satisfactory with one or both. Only those sales of other properties occurring in the normal and usual course of business should be admitted in evidence as having any bearing upon the value of the property in question. Generally only consummated sales and not offers or contracts to purchase or sell which have not yet been executed, are admissible. Although some courts, upon exception, have allowed sales contracts to be admissible evidence. Offers and negotiations between the parties to the proceeding are not admissible since they constitute efforts to compromise.
The assessed valuation of a tract of land, in the absence of some showing that the owner actively obtained such evaluation, is not admissible. If the owner has actively obtained the assessment, there is no reason why it should not be admissible, at least for impeachment.
In determining the value of a tract of land that is improved with buildings, the cost of construction is not necessarily admissible in evidence since the buildings are to be valued with the land and should be considered only insofar as they add value to the land. Thus, an ill-adapted building on a tract of land may not add value to the land to the extent of the cost of reproducing the building less the physical depreciation of the building. The reason for this rule is well demonstrated in the instance where the best use of a tract of land is for commercial purposes while the tract is improved with an older type residence. In order to reassess the value that the land has for commercial purposes it would be necessary to demolish the residence. However, the mere fact that a residence is located in an area primarily adaptable for commercial use does not mean that the building has no value, since in many instances the loss which would be sustained in demolishing the building to permit the land to be devoted to another use would exceed the enhanced value to be realized from the land in devoting it to such uses. In such instances the land and improvements should not be evaluated separately, thereby placing a commercial value upon the land and a residential value upon the building, but the property should be evaluated on the basis of its value for sale as a residential property.
The rental realized from a piece of property may be admissible when properly connected to the issues as having a relationship to the value of the property. It is required, however, that if the rental realized from a tract of land is admitted in evidence, it must be connected in some manner to the value of the property. A definite destination must be drawn between the rental produced by a property and the income produced upon the property. The former is the price which a tenant is willing to pay, or is paying, for the right to use the property while the latter represents not only productiveness of the property itself, but also the productiveness of the person who is conducting the business. Thus, the volume of business and the profits from the business are not admissible as bearing upon the value of the property, since such items reflect not only the earning of the property but the good will and productiveness of the owner of the business. However, case law holds that the gallons of gasoline sold at a service station is admissible when properly related to the rental value of the property.
236.10.3.4 Witnesses
Since "expert witnesses" in condemnation cases, who are called to express opinions as to values, are not in a strict legal sense experts to the same extent that doctors are experts in the medical field, it is necessary before such witnesses are permitted to testify that a showing be made that the witness is in a position to have knowledge of the property in question and its value which is superior to that of the jury. Thus, these witnesses must be sufficiently familiar with the property in question and its surrounding conditions, as well as the general market value of lands in the community to the extent that the reasonable inference would be that they are capable of arriving at a more valid conclusion as to the value of the property than would the jury be by merely describing to them the physical aspects of the property and the market conditions in the community where it is located. Such witnesses, however, are not disqualified by the mere fact that they have never bought or sold property in the community where the property is located if it is shown that they have had sufficient experience generally in the purchase and sale of real estate, are familiar with the property in question and the surrounding community, and have made sufficient investigation of the market conditions in the area to acquaint themselves with the market values generally.
The fact that witnesses may have served as a commissioner in the case does not prevent them from witnessing before the jury if they are otherwise qualified. The fact that they were a commissioner, however, and the amount of the award should not be revealed to the jury. If the witnesses testify to an amount of damages which is different from that contained in the commissioners' report which they signed, the opposing party should be permitted to cross-examine the witnesses as to a prior inconsistent statement having been made by them under oath. This, however, involves the risk that such cross-examination might reveal to the jury the amount of the commissioners' award or the fact that the witness was a commissioner. In order to minimize this risk, however, there appears to be no reason why a request cannot be made to the court that the witnesses be instructed, out of the hearing of the jury, that in making answers to questions on cross-examination the witnesses not reveal or indicate to the jury the amount of the commissioners' award or the fact that they were a commissioner.
Witnesses who appear and testify in a condemnation case should be in a position to state the basis upon which they have formed their opinion. It is doubtful, however, that their inability to do so renders their testimony incompetent and subject to being stricken from the record. Such a failure does, however, go considerably to the weight that the jury should give to such witness' testimony. Witnesses, in stating the basis for their opinion, should not be permitted to lug into the case matters that are not proper for the jury's consideration and the witnesses' opinion should be based upon matters that are relevant and elements for which the property owner is entitled to compensation. The testimony of witnesses who have based their opinion of damages in part upon elements that are not compensable is not subject to being stricken in the absence of a showing that the witnesses have no opinion did they not consider such elements. It is possible for this rule to result in considerable confusion to the jury. When it is shown that witnesses have included elements which are not proper yet the witnesses are unable to testify as to what extent those elements influenced their opinion, the opponent is entitled to have the portion of the testimony of the witnesses which is not proper stricken, and the jury instructed to disregard it, with the result being that the jury is left with no yardstick to determine what portion of the witnesses' testimony they should consider.
236.10.4 After Trial Proceedings
236.10.4.1 Apportionment Among Various Owners
In the trial of a condemnation case, the case should be tried and submitted to the jury or to the court as though the property were under the ownership of one person and thereafter the total compensation found to be owing to the owners should be apportioned among the various owners according to their respective interests. As a general rule the owners of the property involved are able to agree among themselves as to the apportionment of the award or the final judgment. Legislation provides a method for the apportionment of the commissioners' award prior to final judgment. Under this statute the parties may agree among themselves as to a distribution of the award and file the agreement with the court, setting out the manner and the percentages of the award which is to be divided among the various owners. If no such agreement has been filed within thirty days after the commissioners' award is paid into court, any party interested in the award may petition the court for a distribution of the award among the various owners. Under this proceeding the condemnor has the right to intervene in the proceeding for the apportionment of the award whether it be by agreement or by the court. The statute also provides that if the award is apportioned by the court on motion of any party, it shall be considered as an appealable judgment and that any party aggrieved by the determination may appeal. The respective interests of all parties, whether determined by agreement or by the court, shall be final and binding on all parties and shall extend by percentage to any additional compensation awarded as a result of a trial of exceptions or any reduction of the award thereafter made, provided, however, that when the interest of any owner is not related to the difference in the value of the property before and after the taking, the share set out in the agreement or the court's finding will not be affected by any increase or reduction so long as the final compensation is not less than such interest. Under this procedure whether the apportionment is made either prior to the trial exceptions or after the trial of exceptions, all parties who have an interest in the land taken or damaged are entitled to be compensated out of the fund in the hands of the clerk for the amount of any such damages. Evidence introduced at the hearing for distribution is not admissible in the subsequent trial of exceptions.
The most common problem encountered is in making the division between the compensation due a landlord and that due a tenant. Ordinarily, the lessee's interest is determined by subtracting the actual rent and other expenses assumed by the tenant from the present worth of the fair rental value of the property for the remaining period of the lease. A tenant, however, is not always entitled to compensation. Courts have held that a mere expectation of the renewal of a lease because of the mutual satisfaction of the landlord and tenant is not such a property right in the property as to give to the tenant a right of compensation for that expectation. Also, a month-to-month tenant has been held to have no compensable interest in the award resulting from taking of the property. Also involved in the apportionment of awards is the question of the rights as between the mortgagor and the mortgagee. When the taking involves an entire tract of land, there is, of course, little difficulty in determining the amount to which the mortgagee is entitled. When the entire property is taken, the mortgagee would be entitled to the entire award up to the amount remaining due on the mortgage. The greatest difficulty results when there is only a partial taking of a tract of land. The writer has been unable to find a Missouri case setting out the rights as between the mortgagor and the mortgagee where only a portion of the land is taken. However, it would appear that the proper principle to apply if the parties cannot agree upon apportionment would be that the mortgagee should be entitled to a sufficient part of the award so that the mortgagee will be left with the same margin of security after the taking as before the taking.
236.10.4.2 Judgment and Appeal
There is no necessity in a statutory condemnation case that a judgment of condemnation be entered in order to pass title to the condemnor. The condemnor works its own condemnation of the property by paying into court the award made in favor of the property owner. The judgment entered in a case after a jury trial should be a judgment for money in favor of the property owner if the jury awards monetary compensation to the owner. The judgment, so as to conform to the record, should recite the total judgment entered, the date of the commissioners' report, and the amount awarded, the date such award was paid into court, with the balance due in favor of the property owner with interest, or the amount due to the condemnor with interest as a result of the verdict and judgment being for less than the amount awarded by the commissioners.
The judgment of the trial court entered after a jury trial may be appealed in the same manner as an appeal is taken in the ordinary civil case for damages. Ordinarily, a condemnation case does not involve title to real estate and generally, appellate jurisdiction is determined on the basis of the monetary amount in dispute between the parties. No appeal can be taken by either party in a condemnation case prior to the entry of final judgment except for the right to appeal from an order distributing the commissioners' award. Thus, if either party files exceptions to the commissioners' report in a condemnation case, no appeal can be taken until those exceptions are disposed of. For this reason, attorneys should take care that they preserve their record of objections to matters raised on the appointment of commissioners, as well as their objections to matters during the conduct of the jury trial.
236.10.5 Condemnation Procedures; A Summary
236.10.5.1 Summary
By many, the exercise of the power of eminent domain is thought to be in derogation of property rights. These same persons, however, would be very reluctant to forego the many conveniences and necessities that can be provided only by the utilization of the power of eminent domain. Were condemnation of private property for public purposes not permitted, most of our facilities for public use and public utilities that provide a public service would not be available to us. Were it not for the power of eminent domain, the acquisition of the necessary property and easements for the constructions of public facilities would, in many instances, be impossible, and in others, would be so burdensome economically as to defeat their construction. Thus, without the power to condemn property and devote it to a public use, the construction and maintenance of water lines, power lines, telephone and telegraph lines, railroads, highways and many other such facilities could not be provided. On the other hand, since the primary purpose of constructing and maintaining such facilities is for the public welfare, it is only just and fair that no owner of property be required to relinquish it for such uses without being paid just compensation for such property. Thus, the attorney who takes on the representation of an authority which proposes to exercise the power of eminent domain must be sufficiently familiar with the law on the subject that the attorney can properly advise that authority to what extent and under what conditions it can exercise that power. On the other hand, the attorney who takes on the representation of property owners, whose property is to be acquired, whether it be by negotiation or by condemnation, must remember that the property owners have a right to insist that their property be taken only by an authority authorized to do so, and only for a purpose permitted by statute, as well as their right to insist that they be fairly compensated for the property taken. With this in mind, the attorneys should not only know how to obtain for the property owners just compensation but must also be sufficiently familiar with the other aspects of condemnation that the lawyer can defend the property owner against unauthorized taking of their property.
In the foregoing section, an attempt has been made to set out the basic principles governing the exercise of the power of eminent domain; however, it should be kept in mind that this section is only a guide and does not come even close to answering all questions which can arise in a condemnation proceeding. Anyone who is familiar with the many volumes which have been written on condemnation law, and with the many issues concerning such law which have not yet been resolved by the legislatures or the courts, will readily understand why it is impossible in a short article such as this to set out all details of condemnation law and procedure. With that in mind this chapter is offered with the hope that it will be considered a reference and not a text of authority.
236.10.6 Condemnation Procedures; Case File
The district shall submit one copy of Exhibit 10.6.1 to Legal, Central Office, for each condemnation case immediately after the time for filing exceptions has expired, or after the payment of the award into court, whichever occurs the latest. The district shall retain a copy of this information for their file, and in districts where an assistant counsel maintains separate files, furnish a copy for their file.
All required data on Exhibit 10.6.1 must be accurate. A space is provided for the district right-of-way manager to make recommendation for disposition of the case. Also a brief outline of any unusual circumstances that may affect a settlement or a trail should be provided. The back side of form may be used when necessary.
236.10.7 Eminent Domain Guidelines
236.10.7.1 Introduction
Acquisition of property by "eminent domain" requires the condemned property to be considered for Heritage Value and Homestead Acquisitions; whichever would net the higher proceeds to the owner, if applicable. In the effort to provide the best opportunity for successful negotiations, MoDOT has made the decision to implement these considerations as a part of the negotiations process. This policy provides guidance and a quick reference to the process of acquiring property by eminent domain. However, using district regional counsel and resources from the Right of Way Section should help determine district direction as well as provide consistency between districts.
No condemning authority shall acquire private property through the process of eminent domain for solely economic development purposes.
The terms, “Just Compensation and Fair Market Value,” have been used somewhat synonymously in the past. We are required to offer just compensation based on fair market value, and will continue to do so in our acquisitions using the terms as we do now. There might be other references where fair market value is used in a different context so we will leave those two terms as they are in the current manual.
236.10.7.2 Definitions (RSMo 523.001)
Fair Market Value, the value of the property taken after considering comparable sales in the area, capitalization of income, and replacement cost less depreciation, singularly or in combination, as appropriate, and additionally considering the value of the property based upon its highest and best use, using generally accepted appraisal practices. If less than the entire property is taken, fair market value shall mean the difference between the fair market value of the entire property immediately prior to the taking and the fair market value of the remaining or burdened property immediately after the taking.
Heritage Value, the value assigned to any real property, including but not limited to, real property owned by a business enterprise with fewer than one hundred employees, that has been owned within the same family for fifty or more years, such value to be fifty percent of fair market value.
Homestead Taking, any taking of a dwelling owned by the property owner and functioning as the owner’s primary place of residence or any taking of the owner’s property within three hundred feet of the owner’s primary place of residence that prevents the owner from utilizing the property in substantially the same manner as it is currently being utilized.
236.10.7.3 Alternative Location Proposals (RSMo 523.265)
With regard to property interests acquired by condemnation or negotiations, the landowner may propose an alternative location for the property to be condemned to the condemning authority. The alternative location proposal is to be made in writing to the condemning authority, and is to be received by the condemning authority within thirty days of the landowner’s receipt of a Written Notice of Alternative Location and Design Letter (Form 236.10.7.3B) sent under Section 523.250. Further, the alternative location proposal is to be on the same parcel of the landowner’s property that the condemning authority seeks to condemn, and be in such detail that the alternative location is clearly defined for the condemning authority. This section does not apply to acquisitions of an entire parcel of land.
The condemning authority will consider all such alternative location proposals. A written statement containing the following is conclusive evidence that sufficient consideration was given to alternative location proposals. Therefore, to be found to have engaged in good-faith negotiations during condemnation proceedings, the condemning authority must provide a written statement to landowners who propose alternative locations. The written statement must include the following:
- that the alternative location has been considered, AND
- an explanation of why the alternative location was rejected or accepted.
MoDOT's written response to alternate locations must be made to the affected landowner within two weeks (10 working days) after MoDOT receives the landowner's counter-proposal.
If a parcel goes to condemnation, MoDOT must be able to prove that it has engaged in good-faith negotiations. The law allows the property owner to submit an alternate location for the improvement project and requires MoDOT consider that alternative. Property owners have up to 30 days after they receive the Alternative Location and Design Letter.
District right of way staff will send the 60-day notice, Form 236.10.7.3A (04/04/2023), to all property owners once right of way plans have been approved.
Since condemnation is uncertain at the time right of way plans are approved, MoDOT will provide the Alternative Location and Design Letter and 60 day Notice of Intent to Acquire Letter written statements to all property owners, or potential property owners, who submit alternate location proposals.
The right of way manager must be provided with copies of any rejection and acceptance letters sent to property owners who submit an alternate location proposal. Copies of these letters will be placed in the parcel owners file and be used during the condemnation process to prove that MoDOT has engaged in good faith negotiations.
236.10.7.4 Written Notice (RSMo 523.250)
At least sixty days before the filing of a condemnation petition seeking to acquire an interest in real property, the condemning authority will provide the owner of record of such property with a Written Notice of the Intended Acquisition. Written notices will be provided to fee owners, in addition to any other parties to which a written offer will be made. Such notice shall include:
- Identification of the interest in real property to be acquired and a statement of the legal description or commonly known location of the property (examples: land, access rights, permanent easement, temporary easement, etc.; street address, relationships to landmarks, etc.)
- The purpose or purposes for which the property is to be acquired, which would be the general description of the project that is consistent with the STIP description.
- A statement that the property owner has the right to:
- Seek legal counsel at the owner’s expense;
- Make a counteroffer and engage in further negotiations;
- Obtain such owner’s own appraisal of just compensation;
- Have just compensation determined preliminarily by court-appointed condemnation commissioners and, ultimately, by a jury; Seek assistance from the office of the ombudsman for property rights created under RSMo 523.277;
"The office of public counsel shall create an office of ombudsman for property rights by appointing a person to the position of ombudsman. The ombudsman shall assist citizens by providing guidance, which shall not constitute legal advice, to individuals seeking information regarding the condemnation process and procedures. The ombudsman shall document the use of eminent domain within the State of Missouri and any issues associated with its use and shall submit a report to the general assembly on January 1, 2008, and on such date each year thereafter."
- Contest the right to condemn in the condemnation proceedings; and
- Exercise the rights to request vacation of an easement under the procedures and circumstances provided for in Missouri Statute.
"A property owner of land burdened by an easement created after December 31, 2006, abandoned in whole for a period in excess of ten years, may petition a court of competent jurisdiction to obtain the rights previously transferred and vacation of the easement for monetary consideration equal to the original consideration obtained by the property owner in exchange for the easement. The holder of the easement shall be a party to such action. The holder of any such easement shall be allowed to maintain the easement upon a showing that the holder, in good faith, plans to make future use of the easement. The right to request that an easement be vacated may be waived by the property owner of record from whom the easement was originally acquired or by such property owner's successor in title to the burdened property either in the original instrument of conveyance or in a subsequent signed writing."
The written notice shall be deposited in the United States mail, certified or registered, and with postage prepaid, addressed to the owner of record as listed in the office of the city or county assessor for the city or county in which the property is located. The receipt issued to the condemning authority by the United States Post Office for certified or registered mail shall constitute proof of compliance with the notice requirement; provided, however, that nothing in this section shall preclude a condemning authority from proving compliance with this notice requirement by other competent evidence.
The Written Notice of the Intended Acquisition is to be immediately provided to property owners following the approval of right of way plans. The district shall determine the exact method for delivery of the notice. However, if the district decides to hand-deliver the notice, property owners will be expected to sign a receipt verifying that they have received the notice, and the specific date on which the notice was received. Should the property owners refuse to sign a receipt verifying that they have received the notice, the individual delivering the notice should document the file with the date the notice was delivered, who delivered the notice, who was present when the notice was delivered, that the property owners refused to sign a receipt, etc.
236.10.7.5 Appraisal, Waiver Valuation and Written Offer (RSMo 523.253)
MoDOT will continue to present a written offer to all owners of record of the property. The offer is to be made at least thirty days before filing a condemnation petition and will be held open for the thirty-day period, unless an agreement is reached sooner.
MoDOT will continue to provide the property owner with an appraisal or waiver valuation at the time the offer is made.
All appraisals, payment estimates and/or waiver valuations for properties proceeding to condemnation will be prepared using generally accepted appraisal practices and be prepared by a state-licensed or state-certified appraiser.
HERITAGE VALUE
When right of way plans require the acquisition of any portion of contiguous property that has been owned within the same family for fifty or more years and cannot be utilized in substantially the same manner as it was being utilized immediately prior to the acquisition, the Heritage Value will be verbally offered to the property owner as an administrative settlement, immediately following the presentation of the written offer. Heritage Value is calculated by multiplying the total approved fair market value by fifty percent. The law is written in such a manner that a Heritage Value payment would only be applied within the limits of eminent domain proceedings. However, MoDOT will make administrative settlements for Heritage Value acquisitions in all instances when the properties and property owners meet the requirements to qualify for a Heritage Value payment.
The burden of proof is the responsibility of the property owner. However, MoDOT desires to be proactive and learn of a possible Heritage Value acquisition early in the process. The district will determine the procedures necessary to determine when a Heritage Value acquisition exists, so that the offer to administratively settle the parcel for an additional fifty percent of the fair market value may be presented at the same time the offer is made.
Burden of Proof is defined as legal documentation (i.e. abstracts, copies of deeds, probate/wills, marriage certificates, birth certificates, etc.) that indicates family lineage and provides proof of family relationship in regard to the length of time a family has owned a piece of property and whether or not a Heritage Value acquisition exists.
Family ownership of property may be established through evidence of ownership by children, grandchildren, siblings, nephews or nieces of the family member owning the property fifty years prior to the acquisition. Family ownership may be established through marriage or adoption by such family members, and includes adopted children, step-children, and relatives related solely by marriage. If an entity owns the real property, members of the family shall have an ownership interest in more than fifty percent of the entity in order to be within the family line of ownership.
If the acquisition includes land and/or permanent easements, the fee owner will be offered the Heritage Value. When only a temporary easement will be acquired, the fee owner may or may not qualify for the Heritage Value. For example, if the temporary easement is merely for the construction of an entrance, or “…for men and machinery to work and turn on…” etc., the fee owner would most likely not qualify for the Heritage Value. However, if the temporary easement will substantially change the terrain of the land, it would qualify for the Heritage Value. If a temporary easement is being acquired, in addition to other realty rights, the Heritage Value will be applied to the total approved offer.
Any administrative settlement above the approved offer WILL NOT be used to determine a different fifty percent Heritage Value. Any deviation from this section of the policy requires concurrence from the Right of Way Section.
If it is necessary to acquire a parcel through condemnation and the property owner qualified for the Heritage Value, the approved just compensation as submitted to the district regional counsel for condemnation will only include the just compensation as approved on the appraisal. The Heritage Value will only be considered as an administrative settlement and not a portion of the approved offer.
Should a difficult or unusual circumstance arise, consult the appropriate regional counsel and/or Right of Way Section.
HOMESTEAD VALUE
The Homestead Value will be verbally offered to the property owner as an administrative settlement, immediately following the presentation of the written offer when the following criteria are met:
- The acquisition includes a dwelling that functions as the fee owner’s primary place of residence,
OR
- Includes property within three hundred feet of a dwelling that functions as the fee owner’s primary place of residence, and cannot be utilized in substantially the same manner as it was being utilized immediately prior to the acquisition.
Homestead Value is calculated by multiplying the total approved fair market value by twenty-five percent. The law is written in such a manner that a Homestead Value payment would only be applied within the limits of eminent domain proceedings. However, MoDOT will make administrative settlements for Homestead Value acquisitions in all instances when the properties and property owners meet the requirements to qualify for a Homestead Value payment.
The burden of proof is the responsibility of the property owner. However, MoDOT desires to be proactive and learn of a possible Homestead Value acquisition early in the process. The district will determine the procedures necessary to determine when a Homestead Value acquisition exists, so that the offer to administratively settle the parcel for an additional twenty-five percent of the fair market value may be presented at the same time the offer is made.
Methods for determining the fee owner’s primary place of residence may be, but are not limited to, the following: address on driver’s license, mailing address, voter identification address, address reported to the Internal Revenue Service for taxing purposes, address in the local telephone directory, etc. A notarized, sworn statement from the fee owner regarding the fee owner’s primary place of residence may also be used to substantiate residency.
If the acquisition includes the fee owner’s primary place of residence, the Homestead Value payment will not reduce any replacement housing payment the fee owner may be eligible to receive through the Uniform Relocation Act. However, any administrative settlement above the sum of the approved offer and Homestead Value will proportionately reduce the replacement housing payment.
If the acquisition includes land and/or permanent easements within three hundred feet of the fee owner’s primary place of residence, the fee owner will be offered the Homestead Value. When only a temporary easement will be acquired, the fee owner may or may not qualify for the Homestead Value. For example, if the temporary easement is merely for the construction of an entrance, or “…for men and machinery to work and turn on…” etc., the fee owner would most likely not qualify for the Homestead Value. However, if the temporary easement will substantially change the terrain of the land, it would qualify for the Homestead Value. If a temporary easement is being acquired, in addition to other realty rights, the Homestead Value will be applied to the total approved offer.
Any administrative settlement above the approved offer WILL NOT be used to determine a different twenty-five percent Homestead Value. Any deviation from this section of the policy requires concurrence from the Right of Way Section.
If it is necessary to acquire a parcel through condemnation and the property owner qualified for the Homestead Value, the approved just compensation as submitted to the district regional counsel for condemnation will only include the just compensation as approved on the appraisal. The Homestead Value will only be considered as an administrative settlement and not a portion of the approved offer.
If any situation is encountered that is questionable with regard to the fee owner qualifying to receive the Homestead Value, such as the acquisition of controlled access rights only, contact the Right of Way Section.
236.10.7.6 Good Faith Negotiations (RSMo 523.256)
Before a court may enter an order of condemnation, the court shall find that the condemning authority engaged in good faith negotiations prior to filing the condemnation petition. A condemning authority shall be deemed to have engaged in good faith negotiations if:
- The condemning authority has properly and timely given all notices to owners as required,
- Relocation notices to all displaced persons including a general description of their potential rights and benefits Residential Relocation Brochure and Business Relocation Brochure Brochures and Eligibility Notice).
- Written notice of the intended acquisition at least 60 days before the filing of a condemnation petition (Written Notice of the Intended Acquisition).
- A written letter offer to all owners of record.
- The condemning authority has made an offer, under Section 523.253, that was no lower than the amount reflected in an appraisal performed by a state-licensed or state-certified appraiser, provided an appraisal is given to the owner. In other cases, the offer is no lower than the amount provided in the basis for its determination of value of the property, in which an explanation with supporting financial data is used (Copy of appraisal signed or co-signed by a state-licensed or state-certified appraiser or waiver valuation).
- The owners have been given an opportunity to obtain their own appraisal from a state licensed or state certified appraiser of their choice (Written Notice of Intended Acquisition).
- Where applicable, the condemning authority has considered an alternative location proposed by the owners (certified letter sent prior to the public hearing and letter responding to alternative location proposals).
If the court does not find that good faith negotiations have occurred, the court shall dismiss the condemnation petition, without prejudice, and shall order the condemning authority to reimburse the owners for their actual and reasonable attorney’s fees and costs incurred with respect to the condemnation proceeding, which has been dismissed. The necessary documentation to be included in the tract packs submitted for condemnation should be coordinated with the district’s regional counsel.
236.10.7.7 Just Compensation for Condemned Properties (RSMo 523.039)
As defined in the law, in all condemnation proceedings filed after December 31, 2006, just compensation for condemned property shall be determined under one of the three following methods. The method used will be the one that yields the highest payment.
- An amount equal to fair market value; or
- For condemnation of property that results in a homestead acquisition, an amount equal to the fair market value of such property multiplied by one hundred twenty-five percent; or
- For condemnation of property that results in any acquisition that prevents the owner from utilizing the property being acquired in substantially the same manner as it was being utilized immediately prior to the acquisition, and involving property owned within the same family for fifty or more years, an amount equal to the sum of the fair market value of such property multiplied by one hundred fifty percent.
Keep in mind that the three methods listed above are referenced in the law as instructions to Circuit Court Judges once the property has been condemned. Neither the MHTC nor other condemning authorities are obligated or required to use these methods to determine just compensation.
HOUSE BILL 1944 SECTION 523.061
After the filing of the commissioners' report pursuant to section 523.040, the circuit judge presiding over the condemnation proceeding shall apply the provisions of section 523.039 and shall determine whether a homestead acquisition has occurred and shall determine whether heritage value is payable and shall increase the commissioners' award to provide for the additional compensation due where a homestead acquisition occurs or where heritage value applies, in accordance with the just compensation provisions of section 523.039. If a jury trial of exceptions occurs under section 523.060, the circuit judge presiding over the condemnation proceeding shall apply the provisions of section 523.039 and shall determine whether a homestead acquisition has occurred and shall determine whether heritage value is payable and shall increase the jury verdict to provide for the additional compensation due where a homestead acquisition occurs or where heritage value applies, in accordance with the just compensation provisions of section 523.039.
236.10.7.8 Report of Commissioners (RSMo 523.040)
The condemnation commissioners shall have forty-five days after appointment by the court to return report of commissioners. The court may extend this date, with good cause shown.
Prior to the issuance of any report, a commissioner shall notify all parties named in the condemnation petition, no less than ten days prior to the commissioners’ viewing of the property, of the named parties’ opportunity to accompany the commissioners on the commissioners’ viewing of the property and of the named parties’ opportunity to present information to the commissioners.
236.10.7.9 Displaced Owners (RSMo 523.055)
Displaced owners of a principle place of residence shall have 100 days possession from the filing of the Report of Commissioners. For detailed information, please refer to EPG 236.8.14.1 and EPG 236.8.14.2, and Form 236.8.14.2(d)1(c)). The 100-Day Vacancy Notice is the only vacancy notice required for owner-occupants who are displaced from their primary place of residence and shall be provided to the owner immediately after the filing of the Report of Commissioners.
Vacancy Notice requirements for the other types of displacements will remain the same.
236.10.7.10 Recovering Damages and Fees (RSMo 523.259)
If any condemning authority abandons a condemnation, each owner of interests sought to be condemned shall be entitled to recover:
- The owner’s reasonable attorneys’ fees, expert expenses and costs; and
- The owner’s actual damages accruing as a direct and proximate result of the pendency of the condemnation, if proven by the owner.
236.10.7.11 RWPA System Requirements for Condemnations
All applicable data must be entered in RWPA under the Condemnation screen for each parcel being condemned.