It is familiar decisional law that property owners seeking just compensation in inverse condemnation cases arising from physical taking or damaging of their land are told that they are entitled to no more than the measure of damages awarded to plaintiffs in private tort cases. Of course, that isn’t entirely true — at its best it applies only to the strictly compensatory element of economic damages, and does not include other damages awarded in tort cases. But is this rule really true even as to the strictly compensatory elements of compensation?
Consider the recent decision of the New Mexico Court of Appeals Primetime Hospitality, Inc. v. City of Albuquerque, 168 P.3d 1087 (N.M.App. 2007)) that raises that question, and after much circumlocution answers “no.” The owner of the subject property discovered that the city had laid some water lines under his property without his permission. But the city then said “oops” and removed the lines, giving rise to a temporarty taking. On those facts, what is the measure of damages? The owner contended that his measure should be the same as that provided in private tort cases involving trespass by encroachment. The court went through an extensive analysis of possible measures of compensation for partial physical takings. Its opinion comprehensively reviews decisional law in other states, and should be read in its entirety by counsel and appraisers with an interest in this subject. It also collects numerous law review articles dealing with the subject of damages for temporary takings (see 168 P.3d at 1094).
But what about that busines of using the same measure of damages in inverse physical takings as in private encroachment tort cases? Nothing doing, said the court, adding in a bit of judicial doubletalk: “We are aware that the notion of full indemnification in the context of condemnation proceedings is generally recognized to encompass a more limited range of remedies than, for example, negligence tort law.” In other words, “full indemnification” isn’t full and it isn’t indemnification; it’s less than in cases of private encroachment. Concluded the court: “. . . New Mexico has not adopted a tort measure of damages in condemnation. . .” * * * “We decline to do so.” * * * “We detect no general movement in our condemnation case law toward a broader measure of damages.” * * * “The default measure of damages for [the owner’s] loss is . . . an eminent domain measure. Whatever that measure ultimately may be, we do not agree that we must import tort concepts wholesale to provide constitutionally adequate just compensation.”
So there you have it folks. The tort measure of damages is just dandy when it is used by the courts as a ceiling, to limit compensation in inverse condemnation cases, but its use is a no-no when it comes to using it as a compensatory floor. Now, all that’s left to explain is the why of it. Why do the courts go on about making the condemnees whole, about putting them in the same position pecuniarily that they would have occupied had there been no taking, but then — in a classic bait-and-switch exercise — the courts have it that compensation which fails to meet these criteria is nonetheless the constitutionally required “just” compensation?