VDOT Condemnation Cases Involve Appraisal Issues

VDOT Condemnation Cases

Brien Roche

Virginia Department of Transportation (VDOT) is the primary condemner in most eminent domain cases statewide. However there may be other governmental entities that condemn property. Their process is all much the same. Title 33.2 of the Virginia Code governs VDOT’s acquisition of highway rights. Virginia Code § 25.1 sets forth general condemnation procedures that apply to VDOT and also to all other governmental entities.

The first thing that VDOT will typically do is a mass appraisal if their plan is to acquire several properties. That appraisal is done typically by one appraiser. That appraiser knows who is buttering their bread and therefore they come in with lowball appraisals. VDOT may negotiate off that number to some extent. Their mantra however is that they’re bound by this independent appraisal. Obviously the appraiser is about as independent as I might be.

As a property owner, you need to have your own appraiser who is going to come in with an appraisal that is on the high end of what is reasonable. The true value of the property may well be somewhere in between but you don’t want to accept what VDOT is preaching.

If a lawsuit is filed, you need to make a decision as to whether or not you want to initiate discovery. If VDOT initiates discovery then they may be liable for some of your cost and expenses including experts.

VDOT Condemnation Cases-Appointment of Commissioners

As the property owner, you want commissioners to decide the issue of fair market value at trial. Those commissioners simply need to be local property owners. Ideally they should be property owners somewhere in the area of the property in question. As a property owner, you can select a group of potential property owners and ask that they be summoned for trial to be interviewed by counsel and either seated or not seated as the jury commissioners. Their role is to decide what is the fair market value of the property i.e., just compensation. That value is determined as of the date of the taking. The decision of the commissioners need not be unanimous. They must however undertake a view of the property as part of the court proceeding.

If the property owner is claiming loss of profits as a result of the relocation, the burden of proof rests with the property owner on that issue.

For more information on how the property is evaluated, see a blog post on this site dealing with market value of real estate.

Testimony of Property Owner

As part of a condemnation case, testimony from the property owner as to value of the property may be powerful. The property owner needs to be well-armed. The property owner needs to be familiar with the recent sales in the area. In particular they need to be familiar with any of the comparables used by either the VDOT appraiser or your own appraiser.

As to each of those sales, you need to speak with the listing real estate agent to get the true background on the sale. In addition you need to find out whether or not these other properties, assuming that they’re commercial, have a Certificate of Occupancy or a Non-Residential Use Permit. Is there a business license issued to them? How they are zoned. Anything that might be pertinent to the value of the property? It’s not unusual that properties have split zoning. That is, part of the property may be zoned commercial and part of the property residential. If the subject property does not have that split zoning and the purported comparable does, then it probably is not comparable.

VDOT Condemnation Cases-The Award

If the award by the jury commissioners exceeds 25% of the initial offer made by VDOT, then the court may award cost and fees. The property owner should have already received the amount of the deposit made by VDOT to the court. If the property has an improvement on it, then VDOT is not entitled to recover the amount by which the deposit exceeds the eventual award.

The jury award may not be what is called a “quotient verdict”.

Jury Instructions

Jury instructions can be critical in a case such as this. The book edited by Paul Terpak entitled, Eminent Domain Law in Virginia, published by Virginia CLE is an excellent source on all condemnation issues. That book provides some potential jury instructions. One of them deals with the definition of what is a comparable sale.