Appraisals and Eminent Domain

One of the most important but often problematic steps in the eminent domain process can be obtaining an appraisal or valuation, however it is extremely important not to undertake appraisal too early in the process. Many times landowners hire appraisers before consulting with an attorney, and sometimes before even really knowing what is going to happen to their property. This is usually an enormous mistake. Every year we see many landowners who hired appraisers to do appraisals far too early in the process, and many times ended up severely regretting it. This can be for a number of reasons, including for the very simple one that until the project is actually built it is likely subject to a degree or revision. Eminent domain is typically an important enough thing for people that they should take the time to ensure that it is done right. That means not rushing to try to get an appraisal early in the process unless the case has been evaluated and the impact of the taking is minimal, or extremely straight forwards.

The short answer is that it is often not as much of a rush as the acquiring agency might lead you to believe. When the acquiring authority makes an offer for your land in an eminent domain proceeding, the amount of the offer is based on the value determined by the acquiring authority's internal reviewer, but informed by the authority's appraisal. However, these appraisals are not always accurate and at the very least may be weighted in the government’s favor due to following the government's interpretation of certain laws, rules, and regulations. This, in turn, can results in the government offering you less than you may have a right to.

There are many reasons that an appraisal can be inaccurate. An appraiser could have missed or misunderstood important legal issues. In addition, the appraiser could have misjudged the property’s actual highest and best use or value, or not be well versed in the rules relating to eminent domain. Finally, some appraisers that are hired by certain condemning authorities appear to have track record of not accounting for, or underestimating, what may be very important factors in certain cases.

Many times condemning authorities try to pressure people into getting what are called sixty day appraisals. The condemning authority will typically tell the landowner that if the landowner gets an appraisal in 60 days, the government will reimburse the landowner for the appraisal. Some landowners believe that they are required to obtain an appraisal in 60 days. While it is true that the condemning authority must reimburse the reasonable cost of an appraisal that is give to them within 60 days, in many cases it is a very bad idea to get an appraisal under these conditions. But, admittedly, in some cases it is a very good idea to get a 60 day appraisal, for example if the case is not complicated and the appraiser is highly competent and well informed. Be sure to contact and consult with an attorney well versed in eminent domain before hiring an appraiser, and if possible before discussing your property with the condemning authority at all.

It is generally good advice not to hire an appraiser until you have consulted with an attorney. The first step in any representation must be to determine whether or not the taking is lawful, and if it is, what extent of legal and property rights are being acquired, and what legal and property rights the condemning authority must compensate for. The original appraisal that you have done can likely be used against you in a hearing or in a court.  Therefore, choosing the wrong appraiser or getting an appraisal too early in the process can greatly hinder your chances of receiving just compensation. Hiring an appraiser or getting an appraisal too early in the process is potentially one of the most detrimental things you can do in your case.

In conclusion, if at all possible do not simply accept the acquiring authority’s offer, do not hire an appraiser, do not talk to the authority's agents about your property, do not rush to obtain an appraisal, and do not sign anything, until you have consulted with a lawyer who is well versed in eminent domain for a case evaluation. The government will frequently try to offer you much less than you have a right to receive, but there may be many other issues at stake that are not immediately apparent and in some cases the government's offer is fair or even generous. There is an appropriate time to have a qualified appraiser or other professional weigh in on the value of your land to help ensure that your rights are protected and that you receive just compensation, but do not hire an appraiser or get an appraisal prior to having your case evaluated by an attorney well versed in Wisconsin Eminent Domain law if possible.