Property Rights in the State of Oklahoma
Like many states, Oklahoma’s eminent domain laws are a combination of Constitutional provisions, state statutes and case law. To understand the process and procedures fully it is important for any property owner being subjected to the eminent domain power to consult with an attorney experienced in the area of eminent domain and property takings.
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A Summary of Oklahoma’s Eminent Domain Laws
The following responses are intended to provide general information about eminent domain laws in the featured state. Such information does not constitute legal advice. Anyone interested in learning more about eminent domain law and the impact it may have on a given set of facts should consult with an OCA attorney or another attorney experienced in handling eminent domain cases.
Who Can Exercise Eminent Domain Laws?
The primary eminent domain process and procedures in Oklahoma can be found in Title 27 and Title 66 of the State Statutes. Title 66 allows railroads to use the power of eminent domain.
Besides the State of Oklahoma and the Oklahoma Department of Transportation, Title 27 provides that the following additional entities, among others, can take private property:
- Local governments such as counties, cities, towns, and townships
- Turnpike authorities
- Utility companies
- Coal pipelines
- Schools, school districts, and universities
- Water power companies
- Common carriers
- Private parties for private ways of necessity
What Are the Legal Requirements for Exercising the Power?
Article 2, Section 24 of the Oklahoma Constitution provides in part that:
"Private property shall not be taken or damaged for public use without just compensation. Just compensation shall mean the value of the property taken, and in addition, any injury to any part of the property not taken. Any special and direct benefits to the part of the property not taken may be offset only against any injury to the property not taken. Such compensation shall be ascertained by a board of commissioners of not less than three freeholders, in such manner as may be prescribed by law.
It also states that:
"In all cases of condemnation of private property for public or private use, the determination of the character of the use shall be a judicial question."
What Limitations or Defenses Exist?
Under Oklahoma law, the intended use of property being taken by the eminent domain power must be for a public purpose and also must be reasonably necessary. Further, with the adoption of the Landowner's Bill of Rights in 2015 property owners are provided with a Statement of Rights if their property is being taken under Title 27 or Title 66. The Statement of Rights generally addresses, among other things, the following:
- You are entitled to receive just compensation if your property is taken for a public use.
- Your property can only be taken for a public purpose.
- Oklahoma law prohibits the taking of your property solely for economic development.
- Your property can only be taken by a governmental entity or private entity authorized by law to do so.
- The entity must notify you that it wants to take your property.
- The entity proposing to take your property must make a bona fide effort to negotiate to buy the property before it files a lawsuit to condemn the property – which means the condemning entity must make a good faith offer that conforms within Titles 27 and 66 of the Oklahoma Statutes.
- You may hire an appraiser or other professional to determine the value of your property or to assist you in any condemnation proceeding.
- You may hire an attorney to negotiate with the condemning entity and to represent you in any legal proceedings involving the condemnation.
- Before your property is condemned, you are entitled to a copy of the commissioners’ report which determines the injury you may sustain by the condemnation of your property and the amount of just compensation entitled to you.
- If you are unsatisfied with the compensation awarded by the commissioners’ report, or if you question whether the taking of your property was proper, you have the right to a trial by a jury or review by the district court judge. If you are dissatisfied with the trial court’s judgment, you may appeal that decision.
What Constitutes a Public Purpose?
There are many common public uses for taking property under Oklahoma law, including but not limited to municipal buildings, new roads or highways, public parks, airports, libraries, courthouses, and hospitals.
However, in Board of County Commissioners of Muskogee County v. Lowery, the Oklahoma Supreme Court held that economic development alone is not a valid public purpose for which eminent domain may be used.
How is Just Compensation Determined?
If a settlement between the parties cannot be reached, the condemnor must file a formal condemnation Petition in the District Court for the county in which the subject property is located. Thereafter, a District Judge will appoint three unbiased, disinterested freeholders, or "commissioners", to decide the amount of compensation that they believe the property owner should receive.The commissioners will inspect the property and issue a report assessing the amount of compensation the condemnor should pay. Compensation awarded by the commissioners must include the value of the property actually acquired as well as damages, if any, by reason of the project’s impact on the value of the remaining property.
If either party believes there has been an error or omission in the commissioner’s report, a written exception must be filed within a certain time period with the court. If the court accepts the written exception, it may order a new appraisal.
If either party desires to challenge the amount awarded by the commissioners, it must do so by filing a Demand for Jury Trial with the Court Clerk within a specific time period following the filing of the commissioners’ report.
How Is Fair Market Value Defined?
Appraisers can determine the fair market value of the property using different appraisals methodologies and based on what is called its “highest and best use,” even if different from the current use. The most common appraisal approaches for ascertaining fair market value are referred to as the comparable sales approach, income approach and cost approach.
What About Recovering Damages to Remaining Property?
It is not uncommon that a condemning authority will use eminent domain to take only part of the landowner’s property. This is sometimes called a partial taking. As stated above, the Oklahoma Constitution requires just compensation be paid not only for the property being taken, but also for damages or injury to remaining property. However, the constitution also requires an offset (or reduction) in compensation for injury to the remainder property resulting from benefits provided by the project.
Is the Landowner Entitled to Recover Reasonable Attorney Fees? Expert Fees? Litigation Costs?
Some of a property owner’s expenses resulting from the taking of property by eminent domain are recoverable. For instance, under Oklahoma law there are three situations that may result in a property owner being awarded reasonable attorney, appraisal and engineering fees. They are (1) when a final judgment determines that the property cannot be taken by condemnation (2) when the condemnation action is abandoned and (3) when a commission first determines the amount of just compensation due, but a later jury awards compensation that exceeds the award of the commissioners by at least 10%.