What Property Owners Should Know About Eminent Domain Laws in North Carolina

Aerial view over of a rural landscape near a lake. Concept image for blog: What Property Owners Should Know About Eminent Domain Laws in North Carolina.

Eminent domain refers to the government’s right to take private property in cases where it is deemed necessary for public use, in exchange for just compensation. If you are a landowner and your land is being seized by a federal, state, or local government entity, it’s important to understand that you have rights. The following are three essential things all property owners should know about eminent domain and condemnation:

1. Private Property Can Only Be Taken for Public Use

Under North Carolina and federal law, a government agency may only acquire property through eminent domain if it is for a public benefit. Courts generally allow for a broad definition of the term, “public use” when it comes to eminent domain matters. However, there are two criteria that are evaluated to determine whether the public use requirement is satisfied. The public use test asks 1) whether the public has a right to definite use of that specific property; and 2) whether the public would receive a benefit from the seizure of the property.

In the event the government cannot satisfy the above elements, the taking would be considered unlawful. In addition, the taking must result in an advantage to the public as a whole — not just a few individuals. Eminent domain is typically used to take private property to build things like schools, hospitals, public gardens, power lines, bridges, and roads. Nevertheless, in certain situations, a taking may qualify under eminent domain if an incidental public benefit would be provided to private developers — such as in cases where jobs would be created and the tax base of a community would increase.

2. Property Owners Must Be Provided with Fair Compensation

Although the government has a right to seize private land for a public benefit, it can only do so if the owner is provided with “just compensation.” This is a crucial protection afforded to private property owners under the U.S. Constitution and North Carolina law. Just compensation is defined as the fair market value of the property on the date the taking occurs. But if only part of the land is seized, the compensation that must be provided to the property owner is measured by the difference in fair market value of the entire parcel immediately before the taking — and the fair market value of the remaining land following the taking.

Pursuant to North Carolina law, there are three basic appraisal methods to value a property when it comes to eminent domain. These include the comparable sales approach, the income capitalization approach, and the cost approach. The comparable sales approach compares similar properties that have been purchased and sold. The income capitalization approach may be applied to income producing properties and considers the property’s earning capabilities in connection with income capitalization to determine the value. If a property has a unique structure that cannot be repurposed, the cost approach may be used to calculate its value.

3. You Can Take Steps to Fight Eminent Domain

There are limited circumstances under which a property owner may be able to fight eminent domain. Although a landowner can’t stop the government from taking their property, they are not required to accept the first offer for compensation. Importantly, eminent domain can be challenged in the following scenarios:

  • The proposed taking does not meet the public use requirement — If the taking is not for a public purpose, the government is not permitted to seize the land.
  • The property owner is not offered fair compensation — The government usually offers much less money to a property owner than the land is worth. While a taking cannot be stopped, a property owner can often negotiate or pursue litigation to obtain a higher amount.
  • The government does not follow the proper steps for a taking — A landowner may be entitled to file an inverse condemnation claim in cases where the government damaged their property and failed to comply with the proper steps for a taking. The property owner then has the right to obtain compensation from the government for the land that was destroyed.

While the government uses an appraisal to support its determination of the amount of compensation it will offer to a property owner, an owner may bring their own appraiser into a case if they are not offered fair compensation. The appraiser is required to assess the best use of the property.

Contact an Experienced North Carolina Eminent Domain Attorney

If you are facing a governmental taking, it’s vital to have skillful representation to obtain the best possible results in your condemnation case. Located in Charlotte, Murray Law provides knowledgeable representation to landowners throughout North Carolina for eminent domain matters. We welcome you to call Murray Law’s Charlotte office at 704-940-9095 to schedule a consultation to discuss your case.

Categories: Eminent Domain