If the land you are renting or leasing for raising crops or livestock has been selected for condemnation by an entity with eminent domain authority, what are your options? The law requires that the owner of the property receive a fair market value for the loss of their land. Depending on the language in the lease agreement, agricultural tenants in eminent domain cases may be entitled to compensation as well.
When a property owner leases their land to a tenant, both parties rarely consider the possibility that the landowner may lose all or part of the property through eminent domain proceedings. Overlooking this possibility can prove to be a costly mistake.
Does Your Lease Agreement Have A “Condemnation Clause” In It?
How do you know if you are entitled to compensation during a condemnation proceeding? First, read your lease agreement. If your lease contains a condemnation clause, it will typically govern the rights of the parties with respect to compensation.
A condemnation clause spells out the respective rights of the landlord and tenant when there is a condemnation of the property that is the part of the lease. Depending on the language, the condemnation clause can allow a landlord to terminate a lease if the leased property is lost through an eminent domain action. The clause will typically spell out each parties’ rights with respect to any compensation awarded.
What if the condemnation occurs while your lease is in effect and your lease doesn’t contain a condemnation clause? In this case, you will probably be able to seek compensation under Texas law. This can include compensation for your leasehold interest as well as relocation costs.
Consider the Possibility of Condemnation Before You Sign the Lease
Landlords and tenants should always work together to resolve any misunderstandings. Cooperation between the two parties could reap benefits for both sides during negotiations. This could mean a larger settlement from the condemning entity.
A highly detailed, written and signed lease agreement protects the both parties’ rights. An experienced Texas property rights attorney can be invaluable in drafting an agreement that best serves both landowner and tenant.
If a landlord insists on a condemnation clause in the lease agreement, make sure the clause defines:
- When and how the lease agreement can be terminated;
- Who has the right to terminate the lease; and
- Which party has a right to any damages or awards.
Also, it would be a good idea to file a memorandum of the lease in the county deed records so that when a condemning entity does a title search they will be aware of your interests in the property.
Frequently Asked Questions About Texas Eminent Domain Laws
Typically, all government entities, including federal, state, county, municipal, water districts, and school districts, have the right of eminent domain. Public utilities may also be granted the right to use eminent domain to acquire private property for power lines, pipelines, etc.
Read more about who can take private property through Eminent Domain in Texas.
In Texas, property may be taken only for a purpose or use that serves the general public. Some common public use reasons for taking land through condemnation in Texas include:
– Transportation projects
– Port authorities, navigational districts, or conservation or reclamation districts
– Water supply, wastewater, flood control and drainage projects
– Public buildings, hospitals and parks
– Utility services
Read more about the types of projects that commonly lead to eminent domain.
There are no laws in Texas that require you to have an attorney to negotiate with the condemning authority. However, when landowners negotiate on their own, they usually find it to be a mistake. An experienced lawyer understands Texas eminent domain laws and uses their knowledge, skills and resources to protect your rights and get the full value of your land.
Read more about how an attorney can help you in negotiating with a condemning authority in Texas.
We Protect the Property Rights of Texas Farmers, Ranchers and Agricultural Tenants in Eminent Domain Cases
Agricultural tenants whose livelihood is in jeopardy due to an eminent domain action should seek experienced legal representation to protect their rights during the condemnation proceedings.
The Texas eminent domain attorneys at Dawson & Sodd have been protecting the rights of both landowners and their tenants for over a century. We’re dedicated to getting both parties the fair and total compensation they are due for their losses. Before you accept any offer from an entity that claims to have eminent domain authority, contact Dawson & Sodd.
Highlighted Case Result for Agricultural Clients Facing Eminent Domain in Texas
At Dawson & Sodd, we regularly work with Texas farmers and ranchers facing eminent domain and inverse condemnation claims. Inverse condemnation claims refer to cases in which land is taken or damaged for public use without compensation to the property owner.
In one such case, our client’s large and productive ranch flooded repeatedly from water releases from an upstream lake. Our client received a final offer of $200,000. After trial and appeal, the Texas Supreme Court upheld a $34.2 million dollar recovery for the ranch owner. Net recovery to the landowners was $21.9 million after legal fees and litigation, trial, and appellate expenses.
