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Eminent domain occurs when the government exercises its right to take private property for public use. When this action is performed, the government must pay the property owner just compensation for the property acquired. This responsibility is stated in the fifth amendment of the United States Constitution. The government may take all of an individual's property or a portion of the individual's property.
For condominiums, when there is a potential eminent domain action, the Board of the Condominium Association may review the governing Master Deed, By-Laws, and New Jersey Condominium Act to determine who must get notice of the potential eminent domain action and what rights the various parties may have. Generally, only the Condominium Association will be named as a defendant in a condemnation lawsuit representing the tenants of the property and is the party who is charged with handling the litigation.
After confirming who gets notice and who oversees negotiations and litigation, the Board may address the merits of the case, which generally focuses on the issue of just compensation to be paid by the government to the Association.
Once the case is settled or reduced to a trial verdict, the responsibility to allocate the award of just compensation is vested in the Board. N.J.S.A. § 46:8B-25. Condemnation actions are expected to increase. Large infrastructure spending bills have been working their way through the federal and state governments for years and will increase condemnation cases since the government and utility companies often need to accumulate private property for their projects.