Online Publications

See some of Saul Fenchel's eminent domain articles covering various subjects in Eminent Domain Condemnation.

What about rent, insurance and real estate taxes and utilities?

Print PDF

Rent

  • Back Rents. The owner of the building should collect all his rents up to and pro-rated to the date of title vesting. If the owner does not collect back rent himself, it will not be adjusted or collected by the condemnor.
  • Rents after Vesting. If any rent is collected by the owner for a period subsequent to the passing of title, the condemnor will demand a turnover of those rents. If unpaid, such rents will be a lien against the award to be made and will have to be paid or adjusted prior to the payment of the award.
  • Continued Occupancy. As set forth in Section XXVI above, the owner or a tenant can often occupy any of the space in the building after vesting, either as a commercial or residential tenant. The condemning authority will demand a rent to be paid for use and occupancy. The amount of this rent may be negotiated. If unpaid, such rent will be deducted upon payment of the just compensation award. Disagreements on the amount of the appropriate use and occupancy rental are resolved by a judicial hearing or may be an issue in the trial itself. No written agreement as to rent should be entered until counsel has reviewed it.

Real Estate Taxes

  • Payment to Vesting. As a general rule, the owner is required to pay only the apportioned amount of the real estate taxes for that part of the tax year prior to vesting of title. However, if the owner is in title as of the tax status date, it is, as far as the assessor is concerned, still the owner and will be liable for the tax for the entire year, although the condemning authority may vest title at some point in that tax year. Note, however, that this excess payment can be adjusted later -- see below.
  • Condemnor/State Refund of Apportioned Taxes. If the tax has already been paid for a period beyond title vesting, the condemnor, upon proper application, will pay an apportioned amount of the taxes. Where the taking is partial, there will be a further apportionment.

Services/Utilities

It is unlikely that the condemnor will arrange for the continuation of utilities or provide services or repairs to the premises after the taking. If you remain in occupancy, it is your responsibility.

Insurance

As a precautionary measure, even where the taking is total, liability insurance should be continued for a reasonable period after the vesting of title as protection against pre-existing physical defects or claims. If the owner of the property continues to occupy all or any portion of the premises, all fire and liability and personal property insurances should continue. The owner should consult its insurance broker as to continuing protection for itself as a tenant with respect to fire and liability insurance.

Back to FAQ list