The Worcester Telegram & Gazette reports that the Massacusetts Court of Appeals recently reversed the judgment of a trial court that had refused to award compound interest in an eminent domain case and awarded only simple interest. The appellate court disagreed.
This is a story of poetic justice. Owners of lakeshore properties in Leicester formed the Cedar Meadow Lake Watershed District (whose purpose was evidently to acquire the lake). After failing to strike a deal with the lake owner (Central Water District) the Cedar Meadow Lake folks filed an eminent domain action to take the lake, offering $87,200. But the trial court awarded $1,157,634. Now, there will be an additional payment of increased interest — compound instead of simple interest — adding another $512,000 in interest. Why so much? Because it took 12 years of litigation to resolve this controversy, and time, as they say, is money.
So it appears that the eventual award was over 13 times the condemnor’s original offer.
You can find the Appeals Court opinion reported as Central Water District Associates v. Cedar Meadow Lake Watershed Dist. , 2011 WL 4424819 (Mass.App.Ct.))