MARYLAND EMINENT DOMAIN LAW 101: Attorney & Author Charles Jerome Ware

www.CharlesJeromeWare.com (We fight.  You win.)

The national law firm of Charles Jerome Ware, P.A., Attorneys & Counsellors, is headquartered in Columbia, Howard County, Maryland.  For an initial consultation, you are invited to contact us at (410) 730-5016, (410) 720-6129, www.CharlesJeromeWare.com.

What Is Eminent Domain?

Eminent domain, broadly understood, is the power of the state or the federal government

to seize private property without the owner's consent. Historically, the most common uses of property taken by eminent domain are public facilities, highways, and railroads.

Traditionally the power of eminent domain has been exercised for the construction of large public projects, but its use is beginning to be broadened to projects involving not ‘public use’ but ‘public benefit.’ The decision in Kelo v. City of New London, a case that came before the US Supreme Court in 2004, set a precedent for property to be transferred to a private owner for the purpose of economic development. The court found that if an economic project creates new jobs, increases tax and other city revenues, and revitalizes a depressed or blighted urban area it qualifies as a public use [Kelo v. City of New London, 545 U.S. 469 (2005)].

Maryland Eminent Domain Laws

[eminentdomain.uslegal.com/Maryland; www.msba.org/Eminent Domain; articles.baltimoresun.com/Eminent Domain; Report of the State of Maryland Task Force On Business Owner Compensation In Condemnation Proceedings/12-7-2005; msa.maryland.gov/megafile/msa/specco/EminentDomain]
 
Maryland Eminent Domain Laws can be found in Title 12 of Code of Maryland.

Subtitle one of title twelve contain the general provisions and subtitle two contains provisions regarding relocation and assistance.  All proceedings for the acquisition of private property for public use by condemnation are governed by the provisions of title 12[i].

Md. REAL PROPERTY Code Ann. § 12-101 provides that the state, any of its instrumentalities, or political subdivisions acting under statute or ordinance passed pursuant to Article III of the Maryland Constitution, may take private property for public use immediately on making the required payment and giving any required security.

A property is deemed to be taken if the plaintiff lawfully is authorized to take the property before trial pursuant to Article III of the Constitution of the State and the required payment has been made to the defendant or into court and the plaintiff has taken possession of the property and actually and lawfully appropriated it to the public purposes of the plaintiff[ii].

The damages to be awarded for the taking of land are its fair market value[iii].  When part of land is taken, the damages to be awarded is the fair market value of the part taken, but not less than the actual value of the part taken plus any severance or resulting damages to the remaining land by reason of the taking and of future use by the plaintiff of the part taken[iv].

For the purpose of determining the extent of the taking and the valuation of the tenant’s interest in a condemnation proceeding, improvement or installation done by the tenant is deemed personal property of the tenant and it is excluded from the taking[v].

The state or any of its instrumentalities or political subdivisions should file an action to acquire private property for public use by condemnation within four years of the date of the specific administrative or legislative authorization to acquire the property[vi].

However, if an action for condemnation is not filed within four years, the state, any of its instrumentalities, or political subdivisions may not proceed with condemnation until it first obtains a new authorization to acquire the property.

The plaintiff should pay all the costs in the trial court and also interest at the rate of six percent per annum on any difference between the amount of money initially paid into court for the use of the defendant and the jury award[vii].

On taking possession, acquiring the right to take possession or the actual transfer of title to the plaintiff, whichever occurs first, the plaintiff immediately should file, with the supervisor of assessments for the county involved, a written notification or a record setting forth in sufficient detail the area of the land and a description of any improvement being acquired[viii].

MARYLAND EMINENT DOMAIN STATUTES

Md. REAL PROPERTY Code Ann. § 12-107 provides that any party to a condemnation case may appeal from a final judgment or determination.  Further, if the plaintiff desires possession pending appeal, it may make payment of the award.  In addition, the plaintiff should file with the clerk of the court a bond to the state for the penalty the court prescribes.

Pursuant to Md. REAL PROPERTY Code Ann. § 12-109, a plaintiff may abandon a proceeding for condemnation by filing a written election to abandon.  Also, a copy of the election should be served on each defendant who has been personally subjected to the jurisdiction of the court.

Md. REAL PROPERTY Code Ann. § 12-110 provides that if the condemnee or his/her predecessor in title has paid taxes, the condemnee is entitled to receive from the condemnor, in addition to the damages awarded for the premises taken, an amount of money which bears the same ratio to the entire amount of taxes on the premises taken as the part of the taxable year remaining on the date of taking bears to the entire taxable year.

In addition to payment otherwise authorized, a displacing agency should make an additional payment to any displaced person who is displaced from a dwelling actually owned and occupied by the displaced person for not less than 180 days prior to the initiation of negotiations for the acquisition of the real property[ix].

Further, whenever a program or project undertaken by a displacing agency will result in the displacement of any person, the displacing agency should make a payment to the displaced person[x].  The payment should include:

1. actual reasonable expenses in moving,
2. actual direct loss of tangible personal property as a result of moving,
3. actual reasonable expenses in searching for a replacement business or farm, and
4. actual reasonable expenses necessary to reestablish a displaced farm, nonprofit organization, or small business at its new site as determined by the displacing agency.

Pursuant to Md. REAL PROPERTY Code Ann. § 12-208, if a displacing agency acquires any interest in real property, the displacing agency should acquire at least an equal interest in all buildings, structures, or other improvements, located on the real property acquired.

[i] Md. REAL PROPERTY Code Ann. § 12-101.

[ii] Md. REAL PROPERTY Code Ann. § 12-102.

[iii] Md. REAL PROPERTY Code Ann. § 12-104 (a).

[iv] Md. REAL PROPERTY Code Ann. § 12-104 (b).

[v] Md. REAL PROPERTY Code Ann. § 12-104 (c).

[vi] Md. REAL PROPERTY Code Ann. § 12-105.1.

[vii] Md. REAL PROPERTY Code Ann. § 12-106.

[viii] Md. REAL PROPERTY Code Ann. § 12-106 (d).

[ix] Md. REAL PROPERTY Code Ann. § 12-202.

[x] Md. REAL PROPERTY Code Ann. § 12-205.

15 Stages of a Maryland Eminent Domain Case

[www.ownerscounsel.com/The Eminent Domain Process/ Joseph P. Suntum, Esq.]

 

What can a property owner expect when the Government decides to take private property for a public use in the State of Maryland?

 

(1) Identification of public need and property to be acquired. In the State of Maryland, the process of condemnation begins with the identification of a public need, and the determination by the applicable governmental body that it is necessary to acquire private property to fulfill that public need.

 

(2) Notice, Offer to Purchase, and Negotiations. Once the decision to acquire private property in Maryland has been made, the condemning authority (also referred to as the "condemnor") generally gives the property owner written notice that it intends to acquire that person's property.

 

(3) Filing an Eminent Domain Lawsuit. If negotiations for the acquisition of the property are unsuccessful, the condemning authority may file a complaint in the circuit court of the county in which the property to be acquired is located. In some Maryland localities, this first requires a taking resolution of the local government to allow a condemnation petition to be filed in court.

(4) Deposit of Estimate of Just Compensation into the Court Registry in Quick-Take Cases. Certain State agencies (such as the State Roads Commission and the Washington Suburban Sanitary Commission in Prince Georges County) and certain jurisdictions (such as Baltimore City, and Baltimore, Cecil and Montgomery Counties) have "quick-take" authority, but the owner still has the right to a full trial to determine the amount of compensation paid after the property is taken by the power of eminent domain. In order to quickly take possession of the property in this fashion, the condemning authority must pay into the court's registry the amount of compensation it believes the owner is entitled to receive (this will usually be based upon an appraisal the owner has received in the earlier negotiations stage). The date that the funds are deposited into the court becomes the "date of valuation" of the property. Once those funds are deposited into the court, the condemning authority has the right to enter upon the property and begin the necessary construction and the property owner is entitled to withdraw these funds.

This step is not applicable in traditional eminent domain cases, as the condemning authority does not take possession, or pay any money, until after a judgment is entered. The date of value is the date of trial, in traditional condemnation cases.

(5) Withdrawing Money from the Court. Also in Maryland quick-take cases, the property owner is entitled to withdraw the estimate of just compensation deposited into the court. This requires a motion be filed with the court requesting that the funds be disbursed to the property owner. There may be several parties with an interest in the funds on deposit; frequently, this includes the property owner and any mortgagee holding a lien against the property at issue. A hearing may be scheduled for the court to hear argument on the motion, but frequently such motions are consented to by all parties interested and no hearing is necessary. Withdrawal of funds paid into court does not prejudice a property owner's claim-he or she can still seek a higher value for the property at trial. Alternatively, a lower judgment could also be entered at trial, meaning that a property owner would have to pay some of the deposited money back to the condemnor.

This step is not applicable in traditional Maryland condemnation cases, as the condemning authority does not take possession, or pay any money, until after a judgment is entered.

(6) Board of Property Review Hearing. In Maryland eminent domain cases in which the State Roads Commission is pursuing the condemnation of property through its quick-take authority, the matter may proceed to a Board of Property Review after negotiations fail. These are 3-member boards in each county, which will hear the case and render an award. Any dissatisfied party may appeal to the circuit court and have the case heard "de novo", or anew. These boards are generally meant to provide an inexpensive procedure for resolving small cases and are not likely appropriate for large contested cases. The Commission can-and often does-bypass a Board of Property Review hearing preferring to file a formal condemnation petition with the circuit court from the outset.

This step is not applicable in traditional Maryland eminent domain cases; it applies only to State Roads Commission quick-take cases.

(7) Scheduling Order. When the formal condemnation petition is filed with the court, the court will issue a scheduling order that will govern the significant deadlines in the eminent domain case. It is very important that the deadlines be noted and complied with, as failure to comply with a deadline can result in prejudice to a property owner's case.

(8) Retention Expert Witnesses. In most Maryland condemnation cases, the only issue for the fact-finder to determine is the amount of money owed to the property owner for the property taken, and this depends on the value of the property taken and the damages to any remaining property. The condemning authority and the property owner will hire a real estate appraiser to value the property and give an opinion as to the just compensation amount the property owner should be paid. In some more complicated cases, additional experts, such as land planners, engineers, or even traffic experts will be necessary to provide the appraiser with the foundational information needed to accurately value the property taken and damages caused to any of the remaining property. It is important that these experts be consulted with and retained early, for the proper framing of a Maryland eminent domain case.

(9) Discovery. The condemning authority and the property owner each have the right to ask the other for information and documents relating to their case, including the names and contact information for witnesses, the documents supporting their claims, and also carry out depositions of witnesses to get more information. This process is referred to as "discovery." In many Maryland eminent domain cases, most of the discovery will relate to the appraisals, opinions, and testimony of the expert witnesses.

(10) Continued Settlement Negotiations and Mediation. The parties may continue informal settlement negotiations up to the date of trial. Additionally, the parties will have the opportunity to participate in a mediation or settlement conference, depending on the jurisdiction. Although voluntary, most courts strongly encourage these as opportunity to make another effort at settlement before trial. Often they are more successful than informal settlement negotiations because a judge or very experienced attorney participates and aids the parties at achieving a resolution.

(11) Pre-trial hearings. Several hearings may occur prior to trial to resolve a variety of issues. Hearings may be scheduled to resolve motions, such as those dealing with discovery disputes or addressing legal or evidentiary issues in the case. Administrative hearings may also occur to address administrative issues such as scheduling a trial date. Most hearings can be carried out by the attorney and do not require the attendance of the property owner.

(12) Condemnation Trial. Maryland provides a right to a jury trial on the issue of just compensation in State condemnation proceedings. The parties may, nonetheless, elect to waive a jury trial, in which case the judge will be responsible for making the determination of the appropriate amount of damages. In Maryland, the property owner also has the right to a jury view, where the jury is transported to the property so that it can view the property first-hand. The parties have the opportunity to present evidence and testimony in support of their claim as to the correct amount of compensation.

(13) Verdict. Once the jury has been presented with all of the testimony and evidence, it will enter a verdict for the amount of compensation to which it believes the property owner is entitled.

In "quick-take" cases, if the award is higher than the initial amount paid into court (see number 5, above), the property owner is entitled to be paid the difference, plus interest. If the award is less, the property owner will have to reimburse the over-payment.

In traditional Maryland condemnation cases, once the jury enters the verdict, the condemning authority can pay the amount of the jury's award and obtain possession of the property. Or, it can elect to abandon the condemnation (if, for example, the jury award is too costly), in which case it will be required to pay the property owner reasonable costs and attorney's fees.

(14) Post-Trial and Appeal. After judgment is entered either party has the right to appeal the judgment if they believe there was an error in the trial. Appeals can take several years to reach resolution. If the judgment is not appealed, it is final.

(15) Relocation Benefits. In some instances, the property owner is entitled to additional compensation for having to relocate a residence or business. Relocation benefits may reimburse a portion of moving expenses, utility reconnection expenses, business advertising expenses, or a variety of other related expenses.