AB 374, as introduced, Wagner. Eminent domain: compensation: loss of goodwill.
Existing law requires the governing body of a public entity to adopt a resolution of necessity, as specified, and send related notices before commencing an eminent domain proceeding. Existing law provides that an owner of property taken by eminent domain is entitled to compensation and imposes certain requirements on the owner in order to be compensated for loss of goodwill, as described.
This bill would further require the owner of a business to prove that there is sufficient evidence to permit the trier of fact to find that goodwill existed prior to the taking of the property.
Vote: majority. Appropriation: no. Fiscal committee: no. State-mandated local program: no.
The people of the State of California do enact as follows:
Section 1263.510 of the Code of Civil Procedure
2 is amended to read:
(a) The owner of a business conducted on the
4property taken, or on the remainder if the property is part of a
P2 1larger parcel, shall be compensated for loss of goodwill if the
2owner proves all of the following:
3(1) The loss is caused by the taking of the property or the injury
4to the remainder.
5(2) The loss cannot reasonably be prevented by a relocation of
6the business or by taking steps and adopting procedures that a
7reasonably prudent person would take and adopt in preserving the
8goodwill.
9(3) Compensation for the loss will not be included in payments
10under Section 7262 of the Government
Code.
11(4) Compensation for the loss will not be duplicated in the
12compensation otherwise awarded to the owner.
13(5) There is sufficient evidence to permit the trier of fact to find
14that goodwill existed prior to the taking of the property.
15(b) Within the meaning of this article, “goodwill” consists of
16the benefits that accrue to a business as a result of its location,
17reputation for dependability, skill or quality, and any other
18circumstances resulting in probable retention of old or acquisition
19of new patronage.
20(c) If the public entity and the owner enter into a leaseback
21agreement pursuant to Section 1263.615, the following shall apply:
22(1) No additional goodwill shall accrue during the lease.
23(2) The entering of a leaseback agreement shall not be a factor
24in determining goodwill. Any liability for goodwill shall be
25established and paid at the time of acquisition of the property by
26eminent domain or subsequent to notice that the property may be
27taken by eminent domain.
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