What is inverse condemnation?

​When most people think of eminent domain or condemnation, what typically comes to mind is a physical taking of land for a public works project (i.e., expanding a right of way for a road widening project).  Physical, or “direct,” takings are the most common exercise of the government’s eminent domain power. The government identifies land that it needs for a public project, and it is then required to pay the owner just compensation. Sometimes it takes a while for the government and the landowner to agree on what constitutes “just compensation,” or its fair market value, and the process for arriving at a figure that accurately depicts a property’s fair market value can get complicated.
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What is less commonly understood, is that the government can “take” property even where it does not physically take control over land.  When this happens, landowners are force to assert their rights in a legal action known as an inverse condemnation, which simply means the landowner initiates the lawsuit rather than the government.  Inverse condemnation actions can be more complicated because the landowner must prove that the government’s actions took their property, where in the typical condemnation that fact is admitted.  A taking can be proven by showing that the government took some action that physically impacted the property in a detrimental way, or that the governmental body imposed unreasonable regulatory limits on land use that took away economically beneficial uses.  If the court determines that a taking has occurred, then a jury will decide the amount of  just compensation.

What are some examples of inverse condemnation?
In order to establish a claim for inverse condemnation, the landowner must show an affirmative, positive, aggressive act of the government.  This may include water or flooding damage that is the result of a public project such as a street widening or sidewalk improvement, a road closing impacting a property’s access to the public road system, or temporarily or permanently blocking a property owner’s access to the public road system. 

However, where a landowner alleges that the government failed to act, for example by failing to properly maintain public water or sewer systems, Courts have generally not found a basis for an inverse condemnation.  For example, where property flooding is alleged to be caused by the government’s negligent design of a drainage system or improperly maintained drainage system, or where a sewage spill is alleged to have been caused by a city’s failure to maintain sewer lines, these cases have historically not been successful where the landowner in unable to allege at least one affirmative act that led to the damage they suffered.   

Most recently, in Ray v. City of Rock Hill, Lucille Ray brought an inverse condemnation action against the City of Rock Hill, alleging that a stormwater pipe located under her house was causing sinkage and related damage to her property.  The stormwater pipe had been located under her house and channeling water for over 100 years, and Ray had recognized problems with sinkage for years. 

Typically, a claim with these facts would be time barred by the three-year statute of limitations; however, in this instance, after Ray commenced suit, the city began a project to repair sewer lines near Ray’s property.  As part of the sewer line project, the city had to cut the stormwater pipes, which temporarily stopped the flow of water under Ray’s house and Ray requested that the city not reconnect the stormwater pipes.  However, the city ignored Ray’s request and after finishing the project, it reconnected the stormwater lines and water again flowed under Ray’s house.  This act of reconnection, the South Carolina Supreme Court ruled, was sufficient to constitute an affirmative, positive, aggressive act and maintain an action for inverse condemnation.  While this was a victory for Ray, the Court limited her potential recovery to those damages caused after the reconnection of the stormwater lines, if any, because all other claims for prior damage were time-barred.

Inverse condemnation can also result from regulatory actions that cause a landowner to lose all “economically beneficial uses” of their property, which is called a “regulatory taking.”  Firm co-founder Cam Lewis litigated a landmark case on this issue, Lucas v South Carolina Coastal Council, all the way to the U.S. Supreme Court.  In Lucas, regulations placed on Mr. Lucas’s property after he purchased it to build homes would have forced him to leave it wholly undeveloped.  The Supreme Court held that this was a taking.  Regulatory takings are difficult to establish, as courts generally recognize the public benefits of regulations such as zonings and historic districts, etc.  Most regulatory takings cases involve balancing the public benefit as against the harm to the individual landowner.
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If you’ve lost the use of your property due to government action, inaction or regulation, the eminent domain attorneys at Lewis Babcock can help you fight for compensation. Contact us to see how we can help.