Source: http://www.tatumlawfirm.com/a-background-to-north-carolina-eminent-domain/
Timestamp: 2019-04-20 10:13:42+00:00

Document:
Just as is the case under Federal law, the power to take property through the exercise of eminent domain is viewed as an inherent function of the state in that it does not need to be bestowed by a particular law. “The right to take private property for public use, the power of eminent domain, is one of the prerogatives of a sovereign state. The right is inherent in sovereignty; it is not conferred by constitutions. State v. Core Banks Club Properties, Inc., 167 S.E.2d 385, 275 N.C. 328 (1969). Department of Transp. v. MM Fowler, Inc., 637 S.E.2d 885, 361 N.C. 1 (2006).
Statutory Authority for Eminent Domain Exercised by Private Condemnors, Local Public Condemnors and the North Carolina Department of Transportation.
N.C.G.S. § 40A-3 provides a list of entities that may exercise eminent domain and under what conditions they may exercise this power. The statute authorizes eminent domain power for private condemnors such as private utilities and other entities engaged in public works projects and local public condemnors such as counties, municipalities, and other local public entities.
Both federal and North Carolina law limit the exercise of eminent domain power.
North Carolina Constitution provides further protections against uncompensated takings. Article I, Section 19 of the North Carolina Constitution provides in part: No person shall be . . . disseized of his freehold . . . or in any manner deprived of his life, liberty, or property, but by the law of the land.
The “law of the land” clause contained in the North Carolina Constitution has been interpreted to incorporate the “public use” limitation on the use of eminent domain from the Fifth Amendment of the U.S. Constitution. Long v. City of Charlotte, 293 S.E.2d 101, 306 N.C. 187 (1982).
(1) the taking must for a public use or purpose State Highway Commission v. Batts, 144 S.E.2d 126, 265 N.C. 346 (1965).
(2) the property owner must receive just compensation for property condemned under the legitimate exercise of eminent domain power Lea Co. v. North Carolina Bd. of Transp., 304 S.E.2d 164, 308 N.C. 603 (1983).
Permanent physical occupations involve some government activity that interferes with the use of property. Even minor interferences will qualify as a taking. Loretto v. Teleprompter Manhattan CATV Corp, 458 U.S. 419, 427 (1982). Further, indirect entry to property caused by a government entity such as flooding, nuisances or odors may also qualify as a taking. Lea Co. v. North Carolina Bd. of Transp., 304 S.E.2d 164, 308 N.C. 603 (1983).
There must be a “rough proportionality”- the exaction must be related in both nature and extent to the impact of the proposed development. Dolan v. City of Tigard, 512 U.S. 374, 391 (2005). See also Batch v. Town of Chapel Hill, 376 S.E.2d 22, 92 N.C. App. 601 (Ct. App. 1989).
Inverse condemnation actions are limited by N.C. Gen. Stat. § 136-111 and § 40A-51 which state that the landowner must institute an action within 24 months of the date of the taking or the date the “project” is completed, whichever occurs later. McAdoo v. City of Greensboro, 91 N.C. App. 570, 372 S.E.2d 742 (1988).
N.C. Gen. Stat. § 40A-1 outlines the procedure in condemnation matters.
There are three basic condemnation procedures, which vary depending on the condemning entity.
In Kelo v. New London, 545 U.S. 469, 125 S. Ct. 2655, 162 L. Ed. 2d 439 (2005) whereby the United States Supreme Court allowed the condemnation and transfer of land to a private corporation for economic development purposes. In North Carolina, the type of eminent domain authority that was exercised in Kelo is restricted by North Carolina’s Urban Redevelopment Law, particularly against blighted properties.
Landowners may challenge a condemnation action in two ways, through a challenge against the condemning authority’s “taking.” If the condemnation action if found to be a legitimate exercise of authority, then the landowner may present a challenge against the amount of “just compensation” offered in exchange for the property.
Although a landowner may present a challenge based on allegations that the condemning authority decision to exercise eminent domain is based on bad faith or an oppressive or manifest abuse of discretion. City of Charlotte v. McNeely, 190 S.E.2d 179, 281 N.C. 684 (1972). In re Housing Authority, 235 N.C. 463, 70 S.E.2d 500 (1952).
Challenges against the calculation of just compensation enjoy a greater latitude in North Carolina courts. As stated below the issue of what defines just compensation is quite clearly defined by the various statutes on the topic, however many disputes will center on how the accepted method of calculation was conducted, primarily as to the assessment of fair market value by appraisers and other experts who provide evidence as to these assessments. In this case, the court may be placed in a position of weighing the validity of each party’s assessment to arrive at the one, which complies most closely with North Carolina law.
What if the Condemning Authority No Longer Needs the Land?
In cases where the condemning authority may attempt to return condemned property also known as surplus property N.C. Gen. Stat. § 40A-70, states the landowner must pay the original condemnation price, and the cost of any improvements, plus the legal rate of interest.
In North Carolina, just compensation is defined by statute.
Under N.C. Gen. Stat. § 40A-64 “the measure of compensation for a taking of property is its fair market value. (b) If there is a taking of less than the entire tract, the measure of compensation is the greater of either (i) the amount by which the fair market value of the entire tract immediately before the taking exceeds the fair market value of the remainder immediately after the taking; or (ii) the fair market value of the property taken.
(1) Where only a part of a tract is taken, the measure of damages . . . shall be the difference between the fair market value of the entire tract immediately prior to said taking and the fair market value of the remainder immediately after said taking, with consideration being given to any special or general benefits resulting from the utilization of the part taken for highway purposes.
(2) Where the entire tract is taken, the measure of damages for said taking shall be the fair market value of the property at the time of taking.
Just compensation in a partial taking is calculated using the “before and after” rule, or “the measure of damages for injury to personal property is the difference between the market value of the damaged property immediately before and immediately after the injury.” Carolina Power & Light Company v. Paul, 136 S.E.2d 103, 261 N.C. 710 (1964). See also Department of Transportation v. Bragg, 308 N.C. 367, 302 S.E.2d 227 (1983).
Under North Carolina law, when the whole or a part of a particular tract of land is taken the owner is not entitled to compensation for injury to other separate and independent parcels of land belonging to him. Barnes v. North Carolina State Highway Commission, 109 S.E.2d 219, 250 N.C. 378 (1959).
Under N.C. Gen. Stat. § 40A-64 and N.C. Gen. Stat. § 136-112 a condemning authority must compensate the landowner for any damage to his property when the condemnor enters property before condemnation. If the parties cannot agree on the damages owed, the landowner may institute an action against the condemnor under the statute.
Under N.C. Gen. Stat. § 136-112 a private condemnor and local public condemnor may be required, in the court’s discretion, to pay a landowner’s reasonable attorney fees, if the landowner recovers damages of 25% over the amount offered by the condemnor.
However, under N.C. Gen. Stat. § 136-112 a landowner is entitled to be reimbursed for attorney fees where his property was damaged but not “taken” by the Department of Transportation or other state agency. Kaperonis v. State Highway Commission, 260 N.C. 587, 133 S.E.2d 464 (1963).
(2) Neither the condemnor nor the owner is liable to the lienholder for any penalty for prepayment of the debt secured by the lien, and the amount awarded by the judgment to the lienholder shall not include any penalty therefor.

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