Eminent domain: identifying issues in damages for the general practitioner.

• Author: Kelly, Carlos A.
• Position: Florida

"The power of eminent domain is an inherent feature of the sovereign authority of the state." (1) (In other words, the fleas go with the dog.) The Florida Constitution limits this power by requiring that full compensation be paid to an owner for property taken,2 and our court system seeks to achieve full compensation with the remedy of damages. In evaluating the merits of a damages claim in an eminent domain proceeding, counsel should recognize the types of damages that are available. This article will briefly review the three categories of compensation in eminent domain and then focus on a single category: the damages that may be available when less than the entire property is sought to be appropriated.

Types of Damages Available

F.S. [section]73.071 addresses compensation and related issues in an eminent domain proceeding. Section 73.071(3) describes the three categories of compensation. The first category is "[t]he value of the property sought to be appropriated." (3) In the next category, severance damages and business damages may be available where less than the entire property is sought to be appropriated. (4) Finally, the third category allows for an award of the reasonable removal or relocation expenses incurred by a mobile home owner. (5)

Before exploring these three categories of damages, an understanding of some basic concepts associated with eminent domain takings will be helpful. To begin with, counsel should recognize there are different interests in real property available to the condemning authority, which is the party exercising the power of eminent domain. (6) For example, the condemning authority can acquire an easement interest or a fee simple interest in a particular parcel of land. In addition, a condemning authority can seek a partial taking or a whole taking, the difference being that a partial taking involves acquiring an interest in less than the entire parcel of real property owned, while a whole taking involves acquiring an interest in the entire parcel.

The damages in the first category (the value of the property taken) and in the third category (the reasonable removal or relocation expenses incurred by a mobile home owner) can be readily calculated. Of the three categories of damages, those available in the second category--the severance and business damages described in [section]73.071(3)(b)--are the least straight-forward. For example, severance damages require not only that less than the entire property be taken, but the taking must cause the damages. (7) Similarly, business damages are available only where there has been a partial taking; they are not recoverable in a whole taking. (80 In addition, as shown in the statutory text, a party seeking business damages must show that the taking of a right-of-way, by the state or other specified governmental body, has damaged or destroyed an established business of a certain longevity, which is owned by the party whose lands are being taken, and which is located upon the adjoining lands owned or held by that party. (9) As severance damages and business damages can be more difficult to ascertain, the balance of this article addresses both of these types of damages exclusively.

Working with Severance Damages and Business Damages

Though severance damages and business damages are related, they are not based upon identical concepts. (10) The two are related because, in order to be awarded, less than the entire property must be sought by the condemning authority. (11) Significant differences between the theoretical underpinnings of severance damages and business damages exist, however, as will be demonstrated.

The Conceptual Basis for Severance Damages and Business Damages. Severance damages may be awarded when a part has been severed from the whole. (12) Stated another way, severance damages are compensation for the reduction in value to the portion of the property not taken by condemnation. (13) Severance damages are considered part of the "just compensation required to be given" for the public taking of private property pursuant to the Florida Constitution. (14) Severance damages and business damages are not duplicative of each other, as illustrated in Division of Admin., State Dept. of Transp. v. Ness Trailer Park, Inc., 489 So. 2d 1172 (Fla. 4th DCA 1986).

Before trial in Ness Trailer Park, the Department of Transportation had contested entitlement to business damages, but stipulated if business damages were available, their amount was $105,000. (15) On appeal, one of the issues raised was "[w]hether the trial court erred in awarding business damages in addition to compensation for the land taken and severance damages," on the grounds that an award of business damages was duplicative of damages for the reduced value of the land remaining with the land owner (i.e., duplicative of severance damages). (16) In reaching the conclusion that severance damages and business damages were not duplicative, the Fourth District Court of Appeal observed that [section]73.071(3)(b) "permits both severance damages--if suffered--and business damages, if proven. It does not say the condemnee may have one or the other, but not both." (17) The Fourth District Court of Appeal concluded that "[t]here is nothing...