Eminent Domain Report

The contours of inverse condemnation liability are often tested by creative California plaintiff’s lawyers. In an opinion earlier this year, one Northern California Federal Court dealt with a novel lawsuit in which the Vichy Springs Resort asserted Federal and state-based inverse condemnation theories against the City of Ukiah arising out the City’s shooting range used to train its police officers (Vichy Springs Resort v. Ukiah).

According to the complaint, guests have been visiting the resort for almost two centuries to take in the curative powers of the carbonated warm ...

In 2024, in what was heralded as a big win for developers in California, the U.S. Supreme Court upended decades of California precedent and held that legislatively enacted development impact fees must satisfy the “essential nexus” and “rough proportionality” tests established in Nollan v. California Coastal Commission (1987) 483 U.S. 825 and Dolan v. City of Tigard (1994) 512 U.S. 374. Sheetz v. County of El Dorado (2024) 601 U.S. 267. But the Supreme Court did not decide whether the legislatively enacted fee program at issue in Sheetz actually failed to comply with ...

Planning and constructing public infrastructure projects takes significant time – sometimes many years. Property owners and businesses who may be impacted are left in a state of limbo, not knowing for sure whether the project will move forward, when it will move forward and what the ultimate impacts will be. This can make selling or leasing property problematic and it can also become difficult for businesses to plan effectively. Despite these impacts, unless public agencies engage in oppressive or unreasonable conduct or unreasonable delay, there is typically no liability for ...

Periodically, a new public project needs to acquire land that is already put to an existing public use. In order to condemn such land, the condemning entity must demonstrate that the proposed use is either a compatible use or a “more necessary public use.” If thorough due diligence is not conducted in the early project stages to identify and address impacted existing public uses, a condemning entity may later face a right to take challenge based on the position that the proposed use is not more necessary than the existing public use.

So, what uses qualify as a more necessary use?

On June 24, 2025, the California Court of Appeal heard argument in Sheetz v. County of El Dorado. You may recall that the California Court of Appeal previously held that legislatively enacted development impact fees are exempt from Nollan/Dolan scrutiny, consistent with what was at the time longstanding California Supreme Court precedent. In 2024, however, the U.S. Supreme Court held that legislatively imposed exactions are not exempt from the essential nexus test established in Nollan v. California Coastal Commission (1987) 483 U.S. 825 or the rough proportionality test in ...

For the third year in a row, our attorneys have outlined key trends and issues shaping the water landscape in Nossaman’s California Water Views – 2025 Outlook. Topics range from the effects of climate change on water availability and infrastructure to critical updates in legislative and regulatory frameworks. The publication not only provides insight into developments at the state level but also addresses how decisions from Sacramento, Washington, DC and across the U.S. are influencing California’s water sector. … 

Can a public entity be held liable for inverse condemnation when it fails to prevent another party from causing damage to private property? This one is pretty simple: the answer is no. 

In Youngsma v. City of Cypress, homeowners sued the City for inverse condemnation and public nuisance because the construction of a vehicle maintenance and repair facility on property near their homes caused significant damage. The homeowners claimed that a school district owned the property in question, and the City failed to hold any public hearings or approve of the proposed repair facility. The ...

We previously reported on the recent California Court of Appeal district split as to what standard of review should apply in utility takeover condemnation cases as it pertains to more necessary public use challenges, and specifically whether courts are to exercise independent judgment or whether a public agency’s determination is subject to substantial deference. This district split stems from the 2024 South San Joaquin Irrigation District v. PG&E case (holding that courts should exercise independent judgment) and the 2025 Town of Apple Valley v. Apple Valley Ranchos Water case (holding that courts should give deference to a public agency’s findings). … 

In California, the primary governing structure for condemnation suits is set forth within Title 7 of the California Code of Civil Procedure (CCP 1230.010, et. seq.), otherwise known as the Eminent Domain Act, which was enacted in 1975. In 2006, a few modest updates were made, including the addition of an appraisal reimbursement provision that requires a public entity to pay the reasonable costs, not to exceed $5,000, for a property owner facing condemnation to secure its own appraisal. Now, about twenty years later in 2025, new legislation, AB 1033, has been introduced to the ...

When water agencies provide water to customers, and that water causes damage to customer property, can water agencies face inverse condemnation liability? For quite some time, inverse condemnation liability appeared to be unavailable based on the theory that the customer “invited” the water onto private property by voluntarily connecting to the public water system. However, a recent court of appeal decision, Shehyn v. Ventura County Pub. Works Agency (2025 Cal. App. LEXIS 94*), has opened the door to potential inverse claims, at least where a property owner receives a ...

In 2024, we reported on a significant published appellate decision, South San Joaquin Irrigation District v. PG&E, which concluded that when a public agency uses eminent domain to acquire the assets of an electric, gas, or water utility, the court can exercise its independent judgment in determining whether the agency’s acquisition satisfies the public use and necessity requirements. The decision provided guidance on the standard of review and the limited level of deference given to public agencies in their decision-making on such utility take-overs. … 

Appraising a property being acquired through eminent domain involves a number of unique valuation rules, including highest and best use, larger parcel, date of value, and unique evidentiary restrictions on comparable sales and hypothetical conditions.  One of those rules is known as the “project influence rule”:  an appraiser must disregard any increase or decrease in the property’s value due to the project for which the property is being acquired.  A recent court of appeal decision, City of Pacifica v. Tong (2024 Cal. App. Unpub. LEXIS 7984*), highlights why this rule is not ...

Investors and developers scour the Southern California real estate market searching for opportunities to buy dated houses that they can demolish and replace with large, modern homes to sell for much more.  A few individuals likely thought they struck gold after inheriting a small bungalow cottage in Coronado, California with panoramic views of the Bay and golf course nearby. The cottage, built in 1924, was the smallest house on the street with the least-utilized lot; it represented both a great opportunity and a bygone era. These soon-to-be developers turned inverse condemnation ...

Despite California’s record high levels of precipitation in 2023, water scarcity remains a pressing issue. Governments have turned to using the power of eminent domain to acquire investor-owned utilities in an effort to improve water service and costs for their communities. This complex process, known as municipalization, contains significant legal hurdles for governments because investor-owned utilities are uniquely empowered to challenge such takeovers.

In Nossaman’s California Water Views – 2024 Outlook, we explore the legal framework of condemnation actions ...

Jillian Friess Leivas recently represented IRWA Chapter 67 (Orange County) at the 2024 Region 1 Spring Forum in Las Vegas, Nevada as the Chapter’s President-Elect and International Director. IRWA Region 1 encompasses all chapters within California, Nevada and Arizona.

During the forum, Jillian was awarded the IRWA Region 1 Young Professional of the Year Award. The award recognizes association members who have demonstrated a commitment to the industry at the Chapter, Region and/or International level of the association in terms of participation, contribution and service ...