Eminent Domain FAQ

View Eminent Domain/Condemnation FAQ
Eminent Domain FAQs about Eminent Domain Condemnation Law.

A) The Ultimate Objective: “Just Compensation”

The Court’s function in a condemnation proceeding, which is imbued with the overall obligation to achieve the constitutional objective of just compensation, is not the acceptance of one value or the other. An award must accomplish payment of just compensation to compensate the property owner for what was “lost” (i.e., damages). Nassau County Beach Club [In re Lido Blvd.], 43 A.D.2d 45, 349 N.Y.S.2d 422 (2d Dept. 1973), aff’d 39 N.Y.2d 958, 386 N.Y.S.2d 886 (1976); Yaphank Development Co. v. County of Suffolk, 203 A.D.2d 280, 609 N.Y.S.2d 346 (2d Dept. 1994) (“there is a constitutional mandate upon the Court to give just and fair compensation for any property taken”).

B) Condemnation Damages: The “Before” and “After” Rule

As a general rule, in a partial taking, the claimant is entitled to direct damages for the property actually taken, and is also entitled to indirect damages (i.e., diminution in value) to the property remaining (i.e., the “Remainder Parcel”). Town of Brookhaven v. Gold, 89 A.D.2d 963, 454 N.Y.S.2d 111 (2d Dept. 1982); McDonald v. State, 42 N.Y.2d 900, 397 N.Y.S.2d 990 (1977); Centereach Car Care Center, Ltd. v. State, 271 A.D.2d 391, 705 N.Y.S.2d 634 (2d Dept. 2000).1

A problem can arise where the overall property consists of two or more parcels. Frequently, the claimant/property owner wants the Court to value the “entire” property so that the “Before” value is as high as possible. In order to apply the “Before” and “After” standard, it must be shown that the parcels should be valued together as one unified parcel. This requires that three conditions be satisfied. There must be (i) unity of title; (ii) unity of use; and (iii) contiguity. The “unity of title” requirement often presents a major issue since contiguous properties, although owned by related parties, often are under different record title ownership or there may be different ownership percentage in the contiguous properties.

C) Unity of Title

In considering the “unity of title” requirement, the courts have applied a “commonsense approach”. Since the overriding objective is a fair award of just compensation, the courts are inclined to look beyond the nominal record ownership of separate parcels; applying a practical approach and value the overall properties as a unified parcel. Legal record title is not the dispositive factor. In Di Bacco v. State, 46 A.D.2d 461, 363 N.Y.S.2d 121 (3d Dept. 1975), the Court held:

“... As we said in Guptill Holding Corp. v. State of New York (23 A.D.2d 434, 437), “it would be contrary to common sense and the rule of just compensation to conclude anything but that the two tracts should be treated as one for the purposes of severance damages in this particular case. ... The paramount constitutional requirement of just compensation must be allowed to prevail over the niceties of legal title advanced by the State”. We also note that the State has not hesitated in the past to urge that separate parcels be treated as a single economic unit notwithstanding technically divergent ownership upon comparable facts, where the effect would be to show that there were no consequential damages in fact (see Red Apple Rest. v. State of New York, 27 A.D.2d 417). Here the sons were deprived of a leasehold in land over which they had control sufficient in the view of the trial court to give them a property interest, the deprivation of which entitled them to consequential damages. In taking that view, in our opinion, the trial court did not err.” (Emphasis Added)

The Guptill case involved two decisions by the Appellate Division. Contiguity was not an issue. However, the legal record title to the separate parcels was in different record ownership. In the first Guptill case, 20 A.D.2d 832, 247 N.Y.S.2d 800 (3d Dept. 1964) (“Guptill I”), the Court stated:

“... After the appropriation and the filing of the claim, the State advised claimant corporation that title to one of the parcels appeared to be in the name of Charles M. Guptill, claimant’s president, and suggested that he assign his claim to the corporation and that the corporation’s claim be amended so as to include the damage to both parcels, all of which was done...”

The Court in Guptill I observed that:

“...the question is a basic legal issue, fundamental to the recovery – that of title and ownership as of the appropriation date.

...

The record before us affords no basis for considering whether the rule might have to be relaxed, or whether close and long-term control could be equated to unity of ownership, where, as here, a well-advanced, functionally unified development can be shown; and any question as to apportionment of damages has been removed by assignment from one owner to the other; and mutual interest and advantage would clearly have demanded – had the proprietors determined to sell – that the tracts be treated as a unit for purposes of evaluation by, and sale to a willing buyer; and where, in addition, there shall exist the factor of control – an element not proven here – by contractual or other effective arrangement. (Cf. 4 Nichols, Eminent Domain [3d ed.], § 14.31, subd. [2], p. 734.) The question is a novel one and the answer uncertain at best and determinable only upon a fully-developed record.” (Emphasis Added)

Upon re-trial, the Court found the requisite unity of title and awarded damages accordingly. 43 Misc.2d 631, 251 N.Y.S.2d 766 (1964).