In Condemnation, Landowners Entitled to Receive Compensation for Damages

By Patrick Reznik

Texas landowners, juries and courts agree – landowners are entitled to receive compensation for damages to their farms, ranches and lands caused by new pipelines. On February 15, 2013, the Texas Supreme Court made a decision inLaSalle Pipeline, L.P. v. Donnell Lands, L.P  to deny LaSalle Pipeline’s  appeal, a ruling favoring the landowner who was affected by the pipeline crossing their land. This is great news for landowners impacted by condemnation or threats of eminent domain proceedings, as this ruling now stands as good law.

We are already seeing the benefits of this new ruling in action. I just got off the phone with a Texas landowner who was contacted by yet another pipeline company who planned to lay a new twenty- inch pipeline across their family lands.  The right-of-way agent (who I’ll call “Mr. Agent”) made the family a very low offer for a planned fifty-foot permanent easement, and forty-five foot temporary easement.  The family told Mr. Agent to “go away,” and called me.  I advised the family to insist on “damages to the remainder” of their lands to be crossed by the pipeline. Damages include the portion the pipeline traverses (or that “take” for the permanent easement and right-of-way) and damages to the rest of the land – or to the “remainder” outside the new permanent pipeline easement. They followed my advice, but Mr. Agent claimed that his company DOES NOT pay for “remainder damages.” Well Mr. Agent, the law allows for compensation to the landowner for reminder damages.

I’m betting Mr. Agent is unaware of the recent Texas Supreme Court decision in  Donnell. In this case, the San Antonio Court of Appeals generally upheld the McMullen County jury’s verdict that almost tripled the damages found by the Special Commissioners. LaSalle Pipeline, like Mr. Agent, found no remainder damages.  The Donnell family’s expert appraiser found a 10% remainder damage for 4,100 acres of the 8,034-acre tract and a 25% remainder damage for the 46-acre tract.

As landowners know, remainder damages to their land are very real – not speculative as Mr. Agent and most in his industry have been asserting for too long

We are watching the Texas Legislature very closely to make sure it does not give this issue back to the pipeline companies. In the meantime, if you have any questions about how much in remainder damages you are entitled to, consulting a qualified attorney is your safest bet.  There are hundreds of ”Mr. Agents” out there, and in most every case, they do not have your best interests in mind, although they claim they do!  Having someone on your side to negotiate the terms of your remainder damages will ensure that you receive the highest dollar possible.