As we know, the private property rights in the United States, though extensive, are not absolute. Using the power of eminent domain, the government can forcibly seize private property for public purposes, if they provide the Constitutionally mandated compensation. Going a little deeper, it’s important to mention that there are three main sub-types of eminent domain. These are physical takings, regulatory takings, and inverse condemnation.
In physical takings, the government performs some action that results in the occupation of private land. In regulatory takings, the government imposes a legal burden so expansive that it deprives the landowner the use of their property. An example might be environmental regulation that prohibits any kind of land developments. If the regulation deprives the land of all economically beneficial uses, it would essentially make the land worthless. Finally, inverse condemnation is a situation where a landowner has brought a claim against the government for compensation. In these cases, the landowner is alleging that government action has resulted in the taking of their land or has caused uncompensated property damage to occur.
There are exceptions to inverse condemnation, however. In a recent California case, Prout v. California Department of Transportation, the Court held that the California Department of Transportation (“Caltran”) did not have to pay the landowner compensation even though it physically occupied the landowner’s property. The exception turned on the fact that the property was legally subject to “dedication.”
Approximately twenty years before the case, the land owner, Loren Prout, dedicated a small strip of land to the state. Briefly, dedication is the donation of private property for public use. This dedication went unaccepted by the government for approximately two decades. Then, in 2010, Caltrans began physically occupying the dedicated strip as part of its work to modify a highway. They did not compensate the landowner for this use.
The landowner sued for inverse condemnation, arguing that Caltrans’ behavior amounted to a physical taking of his property. During its analysis of case documents, Caltrans discovered the twenty-year-old dedication, and argued that there was no taking because Prout had already dedicated the land to the government. Prout countered by pointing out that the government had failed to formally accept the dedication, even though the dedication was offered two decades ago.
The Court held against the landowner on two counts. First, it decided that the government had accepted the dedication by implication. The basis for the implied acceptance was the fact that Caltrans began using the land for its construction process. Second, the Court held that Prout had failed to voice his grievances with the terms of the dedication in a timely manner. The Court pointed out that Prout could’ve objected to the dedication before the onset of this case but failed to do so. Therefore, the Court held for the government.
The case is a lesson for both governments and private property owners on the importance of timeliness in the legal process. Though two decades seems like a generous period, neither the government nor the land owner managed to act in their own interest within that time. If they had, the outcome of the case might very well have been different, particularly from the landowner’s perspective. In fairness to the landowner, knowledge on matters of legal timing, particularly as it concerns niche real estate issues such as dedication, are not common knowledge. Landowners may wish to be conscientious about obtaining qualified legal advice if they have uncertainty, particularly when the government’s ability to occupy their land is at stake.