Property is obtained for a  project like the airport in a similar method to an electric line or pipeline.  It could begin with a request to survey an area of your property for a “potential” expansion.  Then, typically an offer is made for the purchase of the property from the entity seeking to take the property for the expansion.  If the landowner does not think the offer is fair, they have to make a decision.  Accept the low offer or deal with the threat of an eminent domain lawsuit.

In one of the most controversial eminent domain decisions ever, the United States Supreme Court ruled in 2005 (Kelo vs. City of New London ) that a city’s exercise of its eminent domain powers to take private property in furtherance of an economic development plan satisfied the constitutional requirement that such power be used only for a “public use,” even though private developers stood to profit handsomely from the city’s actions. In reaction to that ruling, some state legislatures have been busy crafting legislation to limit the use of condemnation powers in such circumstances. For their part, the owners of property targeted for condemnation have considered how they still might fend off the taking, or, failing that, how to maximize the compensation that the government must pay.

In Kelo vs. City of New London, a landowner was not able to defeat a condemnation initiated by a city so that a new hotel could be built on the property, but he did receive maximum compensation from an obviously sympathetic jury. The landowner was an immigrant who had spent two years and a lot of money renovating a warehouse and building a mail-order cigar business. When two private developers were unsuccessful in negotiations to buy the property as a site for a hotel, they instead reached an agreement with the city whereby the city would condemn the property for their desired use and the developers would pay the costs and fees associated with the condemnation.

When the city was first attempting to buy the property, it sent the landowner a toxic waste notice requiring him to investigate whether any toxins existed in the ground. The landowner tried to comply, but after spending many thousands of dollars he found no toxins. The city would later admit in the litigation that such an investigation was not really feasible so long as a building remained on the property. The toxic waste notice, and especially its suspicious timing, came to be seen as a tactic to put pressure on the landowner during the negotiations leading up to the condemnation.

Although the trial court ruled that the city could condemn the land for the hotel, in the subsequent trial before a jury for damages, the landowner fared much better. The jury awarded him the entire amount he had sought. The award included several million dollars each for the value of the property itself and for the loss of the goodwill associated with the cigar business. Damages for loss of a business are not typical in condemnation cases, but the landowner was able to show that there was no suitable alternative location for the business, so that he would have to start over from scratch. For good measure, the jury also awarded damages equal to the cost of the dubious toxicity study that the landowner had been forced to undertake.

As Texas’ population grows, additional property will be necessary to accommodate this growth, i.e., airports,  roadways, pipelines, utility lines, etc.  Usually the acquisition of this additional property will be through negotiations with the landowner and buyer/developer.  While the landowner may believe he is negotiating the price that he will accept, he could quickly find himself boxed into a corner with limited leverage.  The party pursuing eminent domain could have their lawsuit filed and a group of hand picked special commissioners, whose duty it is to determine a value for the property, already in place well before the owner is aware of what is happening.  This is because the notice requirement in eminent domain lawsuits is much different than the notice requirements in other lawsuits.  Additionally, it may not be the local government pursing this action.  It could be a development company or the state widening a highway or Farm to Market Road.  Their goal is to get the property for the lowest price they can.  On the one hand, they are spending taxpayer money, but on the other hand, it is your home or land they are taking.

If you find yourself in the position of having your property taken by a pipeline company, state or local government about an airport or road expansion, then you should immediately consult an attorney who is skilled in eminent domain, real estate transactions and familiar with the local real estate market.

The post PIPELINES, AIRPORTS, & ROAD EXPANSION appeared first on Moak & Moak, P.C. -Attorneys At Law.

In my last column, I discussed landowner liability.  This week, I will discuss a few steps that should allow a landowner the best opportunity to avoid being held liable.

There are a number of steps for a landowner to consider in order to protect himself or herself from liability.  Importantly, there is no magic solution that will ensure a landowner will never be liable for injury.  Further, there is nothing a landowner can do to prevent a person from filing suit against the landowner. 

Carry Liability Insurance

The most important step a landowner can take to protect his or her operation is to carry liability insurance.  Every landowner needs to have a liability insurance policy covering every activity taking place on the property.  For example, if a landowner has a farm and ranch policy for their cattle operation, but also conducts other activities like leasing the property for deer or bird hunting, the landowner should consult with their insurance agent to confirm the additional activities are covered. 

The amount of insurance coverage depends on the activity happening on the property and the location.  Landowners should consider the amount of risk associated with their operation.  For example, a farm in northwest Texas (middle of nowhere) that does not host any sort of events or have any guests would likely need a lower coverage amount than a rancher in East Texas just North of Houston (populated area) that leases day hunts for deer or birds.  Talking through the details of an operation with an insurance agent will allow a landowner to determine the right coverage level.  You should also discuss the endorsements and exclusions that may be contained in your liability policy.

Identify Dangerous Conditions On the Land

As I pointed out in my earlier column, Landowner Liability, a landowner owes certain duties to a person on his or her property.  Although a landowner is only required to conduct a reasonable inspection and make safe or warn of dangerous conditions for a guest, doing so for all persons may help to avoid an injury altogether.  Landowners should think about their properties and seek to identify any potentially dangerous conditions. Once these conditions have been identified, landowners should take care to warn guests about them or to make them safe. 

Obtain Written Liability Waivers

Liability waivers or releases, are simply documents signed by guests agreeing that they will not hold a landowner liable for injuries that occur on the property.  Texas courts will generally enforce this type of waiver if drafted in a manner complying with Texas law. 

Texas courts require liability waivers to be conspicuous and to comply with the express negligence doctrine.  These requirements are in place in order to ensure a person signing a waiver has fair notice and understands what he or she is agreeing to. 

The language required in liability waivers must meet very specific requirements and therefore you should consult an attorney when drafting them.  Releases should identify the activity involved and common dangers.  Again, seeking the professional help from an attorney when drafting them is recommended. 

Consider Using a Business Entity Structure

Another way to limit potential liability exposure is to consider putting one’s land and/or assets into a business entity which offers limited liability.  This would include a corporation, limited liability company, limited partnership or trust.  These entities must be formed correctly and managed properly.  Many people try to form such entities themselves and/or manage them improperly.  Failing to do either correctly is fatal to the entity and the landowner would lose liability protection.  Factors such as ease of creation, complexity of management and tax liability should all be considered.  Therefore, this is another area to seek legal counsel and expertise.  When formed and managed properly, these entities can provide limited liability for a landowner if someone gets injured on property owned by the entity. 

Does a Limited Libabilty Statute Apply

Texas has three limited liability statutes:  Recreational Use Statute, Texas Agritourism Statute and the Texas Farm Animal Liability Act.  These statutes may apply depending on the activities the landowner is conducting on his or her property.  However, each statute has its own specific requirements.  For example, are fees charged, do the property taxes paid exceed the fees, adequate insurance coverage, and are signs required to be posted?  Therefore the landowner must familiarize himself or herself with each statute’s requirements and consult with an attorney. 

All landowners should be aware of the potential risk of liability if someone is injured on their property.  A personal injury lawsuit can be difficult, time consuming, and expensive to defend.  However, there are a number of steps that can be taken in order to prevent injuries from occurring in the first place and to limit potential exposure in the event one does occur.  Consulting an attorney familiar with real estate and business entity law to help you in this area is very important. 

The information in this column is not intended as legal advice but to provide a general understanding of the law.  Any readers with a legal problem, including those whose questions are addressed here, should consult an attorney for advice on their particular circumstances.

Sam A. Moak is an attorney with the Huntsville law firm of Moak & Moak, P.C.  He is licensed to practice in all fields of law by the Supreme Court of Texas, is a Member of the State Bar College, and is a member of the Real Estate, Probate and Trust Law Section of the State Bar of Texas. 

www.moakandmoak.com

The post Steps for Landowner Liability Protection appeared first on Moak & Moak, P.C. -Attorneys At Law.

A common concern for any Texas landowner is when they may be held liable if someone is injured on their property.  Landowners often ask, “What can I do to protect myself in the event this occurs?”  It is important for landowners to understand the duty the law imposes on them for each person entering their land.  Additionally, there are a number of steps landowners can take in order to protect themselves and their operations from liability.  This week I will deal with a look at the most common legal claims.  

When someone is injured on another’s land, he or she has two potential legal causes of action—a negligent act claim or a premises liability claim.  The two claims each have a separate applicable legal framework.  Thus, the threshold issue is to determine which of these two claims the case falls under. 

Negligence:

A negligent act occurs when there is an “ongoing activity” that leads to the person’s injury.  For example, a person was injured when a box being moved by employees was dropped on the person’s head.  In this example, because the person was injured by an ongoing act – the moving of the box – it was a negligent act case.  

In order to prevail in a negligent act case, a party/plaintiff must prove the following elements: (1) the defendant owed a duty to the plaintiff; (2) the defendant breached that duty; (3) the defendant’s action caused the plaintiff’s injury, and (4) the plaintiff suffered damage.  This is the analysis in a common negligence case, such as a car accident.  In a negligent act case, the plaintiff must prove the defendant acted unreasonably under the circumstances and such action caused the plaintiff’s injury.  Negligence is one of the more common legal claims and can be made in a variety of different circumstances, including a negligent act, a car accident, or pesticide drift. Regardless of the factual circumstances, every negligence case is analyzed utilizing these elements.  

Premises liability:

A premises liability case arises when a plaintiff is injured by a condition on the land, as opposed to an ongoing activity.  Most people have heard of “slip and fall” cases, but I will describe one as an example.  Suppose a grocery store sprayed a substance on the plants in the store.  A person who comes along and falls in that location.  The plaintiff would try to prove that they were injured not by  the ongoing activity of spraying, but rather the condition created after the spraying, wetting the floor, and, as a result of this condition, they slipped and fell.  

It is more difficult to prove the elements of a premises liability claim than a negligent act claim.  For a premises liability claim, an injured party must prove the following elements: (1) the defendant had actual or constructive knowledge of some condition on the premises; (2) the condition posed an unreasonable risk of harm; (3) the defendant did not exercise reasonable care to reduce or eliminate the risk; and (4) the defendant’s failure proximately caused the plaintiff’s injury.  

Note that Texas law divides people into three different categories for the purposes of knowledge of the condition.  They are: (1) trespasser; (2) licensee; and (3) invitee.  A different standard of duties is owed to each of the above with regards to having knowledge of the condition.  Thus, anytime someone is injured on the land of another, it is important to determine which of these categories the injured party belongs to.   My intent this week was to make property owners aware of their liabilities when owning property.  In next week’s column, I will attempt to explain the steps a landowner can take for liability protection.  For more details on what duties you may have as a landowner, please contact an attorney familiar with real estate.  This way you can take steps to protect yourself and your operations from this liability.  

The information in this column is not intended as legal advice but to provide a general understanding of the law.  Any readers with a legal problem, including those whose questions are addressed here, should consult an attorney for advice on their particular circumstances.

Sam A. Moak is an attorney with the Huntsville law firm of Moak & Moak, P.C.  He is licensed to practice in all fields of law by the Supreme Court of Texas, is a Member of the State Bar College, and is a member of the Real Estate, Probate and Trust Law Section of the State Bar of Texas. www.moakandmoak.com

The post Landowner Liability appeared first on Moak & Moak, P.C. -Attorneys At Law.

When land is acquired, through purchase or otherwise, a good starting point for a new landowner is to take time to review the deed records related to that property.  If it is a purchase, the best advice I can give is to obtain a title policy.  The title company can then provide a written summary of matters that affect the property and should be able to provide copies of the deed records.  

Without a title policy, you will find these records are maintained in the courthouse and contain various documents related to the property such as deeds showing the transfer of ownership from one party to another.  This is commonly called the chain of title.  Additionally, the courthouse records will show any express reservations when property is transferred, any encumbrances such as mortgages or liens on the property, and any easements burdening the property.  These records are open to the public, but a thorough exam will take an expert. 

When reviewing records, there are a number of issues to consider.  First, the new landowner should determine if the most recently filed deed shows the correct owner.  When property is transferred by sale, this is generally not an issue, as I said, because a title company often handles examining the chain of title and preparation of the conveying instruments and filing of them to transfer ownership.  

If property is inherited, however, it is the admittance of a Last Will and Testament  or a trust document that dictates how the property transferred.  In either case, there should be a legal instrument filed that either transfers the property from the estate or trust.  This may or may not be in the form of a deed.  Many times I have helped clients with property that is still legally titled in grandparents or even great grandparents names.  This can be a lengthy and expensive process as property does not “automatically” transfer to the next generation.

Second, deed records should be reviewed to determine if there have been any reservations recorded in the official public records.  This is particularly important when determining mineral interest.  There may or may not have been a severance of the property that resulted from reservations.  It is important to consider if there have been any reservations of rights on the property such as mineral, groundwater, or even wind rights.  

Finally, determine if there are any encumbrances on the property.  This could include liens or mortgages on the property that have not been released.  For agricultural land, there could also be lease agreements that have been recorded  that might have to be honored by the new landowner.  Also important is to determine if there are any existing easements on the land, whether those be for existing pipelines, power lines, water lines, or access easements allowing another party to enter the land.  Access easements may be exclusive, shared or for a limited purpose or time. 

This might seem like a relatively easy task, but it can take hours or days to dig through volumes of records, reading very specifically the language in instruments, some of which can be very confusing.  Therefore, while it may be expensive, the best course is to hire an attorney familiar with real estate to assist you.  Then be patient as they perform the task.  And as I pointed out earlier, hiring a title company when you purchase property is a great investment in knowing what you are buying and protecting your purchase.

Sam A. Moak is an attorney with the Huntsville law firm of Moak & Moak, P.C.  He is licensed to practice in all fields of law by the Supreme Court of Texas, is a Member of the State Bar College, and is a member of the Real Estate, Probate and Trust Law Section of the State Bar of Texas. 

www.moakandmoak.com

The post What Do You Own? appeared first on Moak & Moak, P.C. -Attorneys At Law.