The Takings Clause of the United States Constitution covers much more than the actual taking of land. Of course, if the government is going to take possession of your land for public use, it must pay you fair market value for it. In many cases, the government has taken some other type of action that practically erases the value of your land and keeps you from using it as you intended. When that happens, it must also compensate you. That is called a de facto taking of land, which is also known as inverse condemnation. If a government action has the same effect as an actual taking of your land, the same rules of compensation apply.
The Government May Not Always Call a Taking What it Actually Is
The legal theory of inverse condemnation is that the government should be forced to pay for an action that it has taken in all but name. It does not matter what the government calls it. You are requesting that the court formalize what the government has done in practice. The government has already taken action that has cost you money. Your legal response is to seek compensation for it.
The concept of a regulatory taking goes back a century. In a 1922 case, U.S. Supreme Court Justice Oliver Wendell Holmes stated that “while property may be regulated to a certain extent, if regulation goes too far, it will be recognized as a taking.”
The government will not always file a formal notice of condemnation of your property. It may think that it has the right to take certain actions even though they can have a profound effect on you. The government, however, does not have unlimited or unchecked power.
How the Government May Inversely Condemn Your Property
There are several ways the government may take action that could be considered by a court to be an inverse condemnation, including:
- Regulating property in a manner that can grossly lower the value, including zoning regulations and other restrictions on access and use
- Doing something that could accidentally cause severe damage to property
- Taking steps toward condemnation and then not following through, causing significant damage to the value of your property
- Taking action on an adjoining property that prevents you from using your own land or greatly lowers the value
- Imposing a fee on development that is so steep the developer cannot use their land for intended purposes
Even when the government pays you something for its actions, there is a chance it may owe you even more money. This could happen when the government partially takes your land for public use, and the functional effect of its actions deprives you of the use of the rest of your land. For example, taking part of your land can make it impossible for customers to access your business and cause you to lose money and possibly your entire business.
The government may not always come out and offer you fair compensation for its actions. For instance, the government may downplay the impact that its zoning regulation has on your business, not wanting to admit what it has done because it may then owe you money. In order to get compensation, it will be necessary for you to take legal action. You may not be able to stop the actual government action that has diminished the value of your property, but you will be able to get compensation for the resulting loss.
How to Win an Inverse Condemnation Action
Regardless of how the government takes action, your property rights remain the same. You can win an inverse condemnation action when you show the following:
- You owned the property
- There was a public project or action that caused an injury to the property
- The government participated in that action
- The public project or action was the proximate cause of the damage
One of the main differences between an eminent domain case and an inverse condemnation case is who initiates the action in the first place. In an eminent domain case, the government is taking some legal action to obtain ownership of your property. You may take the case to court if the government does not offer adequate compensation, but the government starts the process. When dealing with an actual takings case, it is much clearer what the government is doing. In an inverse condemnation case, the property owner has the burden to pull the curtain back on the government’s actions and show that there is more going on than the government has claimed.
You Must Take Legal Action to Get Full and Fair Compensation
In an inverse condemnation case, you are forced to take legal action on your own. If you do nothing, the government’s action will succeed in devaluing your property and potentially making it useless and unable to be enjoyed. You must persuade a court to reclassify the government action as a taking so you can then receive compensation based on the fair market value of your property. However, in Georgia, if you prevail in your inverse condemnation action, then you will be entitled to an award of your attorney’s fees for bringing the action. An award of attorney’s fees is not available in an ordinary condemnation action.
As a property owner, you should engage early in the regulatory process to have your viewpoint heard. The government cannot issue a new regulation without first providing notice to interested parties and an opportunity to comment. You can take the opportunity to comment to argue that the proposed regulation or action is a regulatory taking. If the government still continues with the regulation, you can file a lawsuit in court to challenge the regulation and/or to seek compensation.
The actual inverse condemnation case could be challenging. The government will usually deny that its actions constitute a taking. You have the burden of proof to meet all required elements and show the government has taken your land. To carry your burden, you would need to make a detailed factual inquiry into the realities of the situation to show what the government has done. To do this you will likely need expert testimony to prove your case. Given how difficult these cases are to win, you should consider retaining a Georgia real estate attorney with experience successfully handling inverse condemnation cases.