Landowners Should Be Compensated for Loss of Business in Eminent Domain Cases

Date: September 29, 2016 Last Edit: October 04, 2016

The National Federation of Independent Business (NFIB) has joined with Pacific Legal Foundation in asking the state Supreme Court to rule in favor of compensating property owners for direct business losses resulting from an eminent domain taking.
NFIB and the Pacific Legal Foundation have filed an amicus brief in the case of South LaFourche Levee District v. Chad M. Jarreau. The case concerns an easement over a property on the west bank of Bayou Lafourche which the Levee District had determined was susceptible to storm surges and flooding. The Levee District asserts that the imposed easement prohibits the owner from continuing his excavation business on site.
 
“This is a very important case for small business owners, because it would require the government to compensative owners not only for the surface value of the land but also for the direct loss of revenue that land produced for them,” said Karen Harned, executive director of the NFIB Small Business Legal Center.
 
The Levee District sent landowners a letter demanding they “immediately cease and desist performing any and all activities upon the property appropriated.” In return, the Levee District said it would pay them the fair market value of the land, as required by state law. “But, in cases like this, government agencies often make low-ball offers in an attempt to undercompensate,” said Harned.
 
One of the landowners who received the letter was Jarreau, of Cutoff, La. He has been using part of the land appropriated by the Levee District for a dirt excavation and hauling business called Bayou Construction & Trucking Co. Jarreau and Bayou Construction filed suit in 2011, claiming that the company should be compensated for the loss of revenue it would have gotten from the use of the land as well as for the land itself.
 
In its filing, the NFIB Small Business Legal Center writes that, “Even where the condemning authority may have only wanted the land and not the business, there is an absolute legal obligation to pay the ‘full and perfect equivalent’ of what has been taken—including direct business losses.” The courts should consider each landowners unique circumstances in determining whether to award damages for loss of business revenue, Harned said.
 
“This isn’t a question of whether the Levee District had the authority to appropriate Mr. Jarreau’s land,” Harned said. “This is about requiring the government to compensate landowners fairly in cases of eminent domain.”
 
NFIB is Louisiana’s and the nation’s leading small business association. 

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