SAN FRANCISCO – A Walnut Creek real estate dispute attorney believes a July 31 ruling entered by the California Supreme Court that reforms legislation to give property owners a right to a trial by jury to determine compensation for pre-condemnation entry and inspection will push the state to try harder to resolve these disputes to avoid costly, time-consuming jury trials.  

“The opinion does give property owners the right to have a jury decide compensation for pre-condemnation entry/inspection, which is a victory for property owners,” Miller Starr Regalia shareholder Basil “Bill” Shiber told the Northern California Record.


However, Shiber said the entry/inspection part of the process is usually temporary and does not involve significant disruption or changes to the site, so the compensation awarded or agreed to in most situations will be relatively small.


Shiber said the Supreme Court’s ruling on the case in question, Property Reserve Inc. v. Superior Court, also made it clear that the government has the right to do this type of entry/inspection without filing a traditional condemnation action, even if the entry and inspection involves temporarily occupying property with equipment, drilling deep into the ground or other invasive testing.


“It is a pragmatic result that allows the government to ‘kick the tires’ using an abbreviated statutory procedure, but also protects the right of a property owner to have a jury decide compensation if agreement can’t be reached,” Shiber said.


In situations where the government decides after an inspection to condemn a property and files a condemnation action, Shiber said there likely will not be much deviation from current procedures because compensation for the pre-condemnation entry will be decided at the same time as compensation for the permanent take.


“Where no condemnation action is filed, the government can still do its entry/inspection, but may be stuck with a jury trial on the amount of compensation due to the owner if agreement is not reached,” Shiber said.


Shiber said Art I, Sec 19 of the California Constitution states that a property owner is entitled to have a jury determine compensation if the government takes his or her property.


“The Supreme Court found the entry statutes would be unconstitutional if they did not provide the right to a trial by jury on the compensation owed to the landowner for the entry/inspection,” Shiber said.


Under the statute addressed in the Supreme Court’s opinion, the state is required to file a petition detailing the access and testing being requested in connection with the entry and inspection of a property. The court would then rule on the government’s petition following a hearing. In addition, the court can order the state to make a deposit that would reimburse the property owner for any damage that may result from the entry/inspection.


In Property Reserve, part of the State Department of Water Resources’ request for testing on 150 parcels spanning several counties in connection with a water conveyance project was approved, but the department did not receive approval to conduct geological testing. An appeals court subsequently denied the department’s requests for both environmental and geological work on the privately owned properties.

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