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What business owners should know about eminent domain - II

Earlier this month, our blog began discussing how commercial litigation is a somewhat nebulous term, encompassing far more than just contract disputes and shareholder disagreements. Indeed, we indicated that it frequently revolved around other legal issues that people typically don't associate with the business world, such as eminent domain.

To that end, we began providing some basic background information on what eminent domain is and the degree to which Tennessee law has established limitations on its use. We'll continue our examination of this complex -- and frequently controversial -- topic in today's post.

Who can exercise the power of eminent domain?

At its core, eminent domain, meaning the power to secure private property for a public use, rests with the General Assembly. Specifically, the state legislature may exercise the power in one of two ways:

  • Passing a statute that expressly identifies a particular private property to be acquired by the state via eminent domain
  • Delegating the power to designated agents via an enabling statute

To whom has the state legislature delegated the power of eminent domain?

The General Assembly has vested both counties and municipalities with the power of eminent domain, as well as corporations/persons legally authorized to undertake work on internal improvement projects, including the construction of roads, causeways, canals, toll bridges, turnpikes and railroads.

How do the state courts view eminent domain?

In general, the state courts recognize that grants of the power of eminent domain are made at the expense of private property rights, and, in accordance with state law, narrowly construe such grants against the condemning agents and in favor of the affected property owners.

Indeed, if the condemning agent has failed to abide by the procedures set forth under state law for exercising the power of eminent domain to any degree, the ability to take the property will be denied.

We'll continue this important discussion in future posts …

Consider speaking with a skilled legal professional who can provide answers and pursue solutions if you have any concerns regarding commercial litigation.

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