Sunday, April 8, 2012

Attorney's fees in an eminent domain case in California

In an eminent domain lawsuit in California, can a property owner obtain an award of attorney's fees against the condemning government agency?  According to California Code of Civil Procedure section 1250.410, at least 20 days before an eminent domain trial relating to the issue of compensation to the property owner, both the government and the property owner are required to exchange their final offer (from the government) and final demand (from the property owner) for compensation. Within 30 days after judgment in the case, if the the property owner thinks that the government's pre-trial offer was unreasonable, and that the property owner's pre-trial demand was reasonable, in light of the evidence admitted at the trial and the compensation actually awarded to the property owner at the trial, then the property owner can file papers requesting that the court award litigation expenses to the property owner, which includes the property owner's reasonable attorney's fees. 

But what if an eminent domain/condemnation lawsuit is resolved before the trial, with one of the parties accepting the other's Code of Civil Procedure section 1250.410 pre-trial offer?  In that case, can the property owner still obtain an award of attorney's fees against the government?  This issue was addressed recently in the case People ex rel. Department of Transportation v. The Superior Court of Sutter County (2012) 203 Cal.App.4th 1505.  The Court of Appeal's decision was filed on March 1, 2012. 

In the Sutter County case, the parties exchanged an offer and demand, as required by section 1250.410.  The condemnor, the Department of Transportation ("DOT"), accepted the property owner's demand and the parties entered into a stipulation for judgment in condemnation, before the trial started. However, the stipulated judgment mentioned nothing about litigation expenses.  The property owners then made a motion for litigation expenses, which the trial court granted, including an amount for attorney's fees.  The DOT subsequently filed a petition for a writ of mandate (similar to an appeal) with the Court of Appeal, and the Court of Appeal agreed to review the matter.  The DOT argued that when the condemning agency accepts the property owner's demand, thereby avoiding a trial, the property owner is not allowed to obtain its litigation expenses from the government.  The Court of Appeal agreed, stating that the focus of section 1250.410 is a case where "the government's unreasonable conduct forces the matter to trial."  In this case, there was no trial, and the Court of Appeal ordered the trial court to vacate its award of litigation expenses in favor of the property owners and enter a new order denying those expenses.