BILL ANALYSIS
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|SENATE RULES COMMITTEE | AB 237|
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THIRD READING
Bill No: AB 237
Author: Papan (D)
Amended: 8/28/01 in Senate
Vote: 21
SENATE JUDICIARY COMMITTEE : 4-1, 8/21/01
AYES: Escutia, Ackerman, O'Connell, Peace
NOES: Haynes
ASSEMBLY FLOOR : 76-0, 5/10/01 (Passed on Consent) - See
last page for vote
SUBJECT : Eminent domain
SOURCE : California Law Revision Commission
DIGEST : This bill would amend eminent domain law to
facilitate resolution of condemnation cases without trial.
Specifically, it would (1) allow parties to submit any
dispute in an eminent domain proceeding for mediation or
arbitration; (2) require appraisal summaries and offers of
compensation to contain detail sufficient to indicate the
basis for the appraisal or offer; and (3) require final
offers and demands to include all elements of required
compensation, including loss of goodwill.
This bill would apply to any eminent domain proceeding
commenced on or after January 1, 2002.
ANALYSIS : Existing law provides that at least 20 days
prior to trial in an eminent domain proceeding, the
CONTINUED
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plaintiff and defendant shall file and serve upon each
other their final offer of, and demand for, compensation
for the subject property.
This bill would provide that the offer and demand shall
include all compensation required pursuant to this title,
including compensation for loss of goodwill, if any, and
shall state whether interest and costs are included.
Existing law provides that issues of compensation in
eminent domain proceedings may be submitted to binding
arbitration by agreement of the parties.
This bill would provide that the parties may agree to refer
a dispute that is the subject of an eminent domain
proceeding to mediation, binding arbitration, or nonbinding
arbitration.
This bill further would provide that in a nonbinding
arbitration, the arbitrator's decision would be final
unless a party timely moves the court for trial. If that
party fails to secure a more favorable judgment at trial,
he or she shall pay the other party's specified costs
incurred from the time of election of trial (including
reasonable costs of expert witnesses) unless the court
finds the imposition of costs would create a substantial
economic hardship contrary to the interest of justice.
This bill further would provide that on motion of a party,
the court may postpone the date of trial for a period that
appears adequate to enable resolution of a dispute pursuant
to mediation or arbitration, if the court is satisfied that
the parties are actively engaged in the resolution process,
appear to be making progress, and agree that additional
time for resolution is desirable.
Existing law provides that at any time before entry of
judgment, the plaintiff may deposit with the State Treasury
the probable amount of compensation, based on an expert
appraisal, that will be awarded in the proceeding. The
expert shall prepare a written statement of, or summary of
the basis for, the appraisal. (CCP Sec. 1255.010)
Existing law further provides that, at any time after this
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deposit has been made, the plaintiff or any other party
having an interest in the property may move the court to
determine or redetermine whether the amount deposited is
the probable amount of compensation that will be awarded in
the proceeding.
This bill would provide that the statement or summary
accompanying the deposit shall contain detail sufficient to
indicate clearly the basis for the appraisal, including:
1. The date of valuation, highest and best use, and
applicable zoning.
2. The principal transactions, reproduction or replacement
cost analysis, or capitalization analysis, supporting
the appraisal.
3. Separate statements of compensation for the property and
damages for the remainder, if any, and the calculations
and a narrative explanation supporting the compensation,
including any offsetting benefits.
This bill further would provide that a motion for
redetermination made pursuant to this section shall be
supported by the same detail as the analysis accompanying
the initial deposit.
Existing law provides that, unless otherwise agreed to by
the parties, the date of exchange for expert witness lists
and statements of valuation data shall be 60 days prior to
trial.
Existing law further provides that statements of valuation
data shall include each matter on which an expert witness
will give an opinion, what that opinion is, and shall
specify the factors used to reach the opinion.
This bill would provide that, unless otherwise agreed to by
the parties, the date of exchange for these lists and
statements shall be 90 days prior to trial.
This bill further would provide that unless otherwise
agreed to by the parties, the date of exchange shall not be
earlier than nine months after the date of commencement of
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the proceeding.
This bill further would provide that if an opinion in a
statement of valuation data concerns loss of goodwill, the
statement shall include the method used to determine the
loss, and a summary of the data supporting the opinion.
Existing law provides for the resolution by the court of
disputes on matters of law, such as the plaintiff's right
to take the subject property, prior to jury trial on the
issue of just compensation.
This bill would provide that, if the parties dispute an
evidentiary or other legal issue affecting the
determination of compensation, either party may move the
court for a ruling on the issue no later than 60 days
before trial. A court that issues a ruling on such a
motion may postpone other statutory deadlines in the action
for a period sufficient to enable the parties to engage in
further proceedings in response to the court's ruling on
the motion.
Existing law provides that, prior to adopting a resolution
of necessity to initiate condemnation proceedings, a
public entity considering acquisition of property shall
offer the property owner an amount it believes to be just
compensation therefor, and shall provide the owner with a
written statement of, and summary of the basis for, the
amount offered as just compensation.
Existing law further provides that, where the property
involved is owner- occupied residential property and
contains no more than four residential units, the homeowner
shall, upon request, be allowed to review a copy of the
appraisal upon which the offer is based.
This bill would provide that the written statement and
summary provided to the property owner shall contain detail
sufficient to indicate clearly the basis for the offer,
including but not limited to the data set forth in the
proposed amendment to CCP Section 1255.010, above.
This bill further would provide that the public entity may,
but is not required to, satisfy the written statement,
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summary, and review requirements of this section by
providing the owner a copy of the appraisal on which the
offer is based.
This bill further would provide that this act in its
entirety shall apply to any eminent domain proceeding
commenced on or after January 1, 2002.
In October of 2000, the California Law Revision Commission
published a report entitled "Early Disclosure of Valuation
Data and Resolution of Issues in Eminent Domain,"
recommending improvements in several areas of eminent
domain law.
The report notes that in almost all condemnation cases, the
primary issue is the amount of compensation. Existing law
seeks to encourage settlement of compensation disputes
before trial in various ways, such as requiring the parties
to exchange valuation data early in the process, and to
make their final offers and demands for compensation before
trial.
The report states that the various incentives for pretrial
settlement have been "reasonably successful," noting that
92 percent of the 3,477 California eminent domain cases
brought to conclusion between 1996 and 1999 either were
resolved before trial or were uncontested at trial.
Nevertheless, the report concludes that various provisions
could be improved to increase the number of cases settled
without trial. The Commission now sponsors this bill
incorporating most of the recommendations in its report.
FISCAL EFFECT : Appropriation: No Fiscal Com.: No
Local: No
SUPPORT : (Verified 8/28/01)
California Law Revision Commission (source)
California Chamber of Commerce
Civil Justice Association of California (CJAC)
ASSEMBLY FLOOR :
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AYES: Aanestad, Alquist, Ashburn, Bates, Bogh, Briggs,
Calderon, Bill Campbell, John Campbell, Canciamilla,
Cardenas, Cardoza, Cedillo, Chan, Chavez, Cogdill, Cohn,
Corbett, Correa, Cox, Daucher, Diaz, Dickerson, Dutra,
Firebaugh, Florez, Frommer, Goldberg, Harman, Havice,
Hollingsworth, Jackson, Keeley, Kehoe, Kelley, Koretz, La
Suer, Leach, Leonard, Leslie, Longville, Lowenthal,
Maddox, Maldonado, Matthews, Migden, Mountjoy, Nakano,
Nation, Negrete McLeod, Oropeza, Robert Pacheco, Rod
Pacheco, Papan, Pavley, Pescetti, Reyes, Richman, Runner,
Salinas, Shelley, Simitian, Steinberg, Strickland,
Strom-Martin, Thomson, Vargas, Washington, Wayne, Wesson,
Wiggins, Wright, Wyland, Wyman, Zettel, Hertzberg
RJG:sl 8/28/01 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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