MICHIGAN LAW ENTITLES HOMEOWNERS TO SUBSTANTIAL BENEFITS IN ADDITION TO PAYMENT OF JUST COMPENSATION

If people are forced to move from their home by condemnation, they may be entitled to additional benefits including payment of 125% of just compensation, a payment to offset future property tax increases, and moving benefits.  Property owners are always entitled to reimbursement of reasonable expert fees and generally entitled to reimbursement of their attorney fees.

Entities with the power to condemn are called agencies.  Agencies may be units of government such as the Michigan Department of Transportation, county road or drain commissions, cities and airport authorities.  Additionally, they might be utility companies.  An agency is free to negotiate voluntary purchases from property owners without using the condemnation process.  An agency may try to avoid condemning in order to avoid paying all of the benefits that property owners are entitled to receive if they are forced to move.

If an agency chooses to condemn, they must first provide a good faith written offer identifying the amount of just compensation that the agency is willing to pay.  The GFO is usually based on an appraisal.

Pursuant to MCL 213.66, an owner receives reimbursement of reasonable attorney fees.

(3)  If the amount finally determined to be just compensation for the property acquired exceeds the amount of the good faith written offer under section 5, the court shall order reimbursement in whole or in part to the owner by the agency of the owner's reasonable attorney's fees, but not in excess of 1/3 of the amount by which the ultimate award exceeds the agency's written offer as defined by section 5. The reasonableness of the owner's attorney fees shall be determined by the court.

An agency can avoid paying some or all of the attorney fees if they increase their good faith offer to reflect certain items that it might have missed originally through a complicated statutory process.

Finally, pursuant to MCL 213.66, an owner receives reimbursement of reasonable expert witness fees regardless of whether they increase the amount of just compensation. 

( (1)  Except as provided in this section, an ordinary or expert witness in a proceeding under this act shall receive from the agency the reasonable fees and compensation provided by law for similar services in ordinary civil actions in circuit court, including the reasonable expenses for preparation and trial.

This statute exists to allow an owner to obtain verification of the fairness of an offer made by an agency.  An owner is entitled to have an appraiser review their case even if the appraiser concurs that the agency’s offer was reasonable.  However, the appraiser should not be retained before receiving a good faith offer.

I have represented many homeowners who have been forced to move by eminent domain.  It is an extremely traumatic process.  Fortunately, there are processes in place to ease the financial burden on owners.

If you have any questions about condemnation and eminent domain issues, please do not hesitate to contact me.