Wednesday, November 16, 2011

Case of the Week

Los Angeles County Metropolitan Transp. Authority v. Alameda Produce Market, LLC (California Supreme Court)

Background: Under California's “quick-take” eminent domain procedure, a public entity filing a condemnation action may seek immediate possession of the condemned property upon depositing with the court the probable compensation for the property. Any defendant in the condemnation action—which includes anyone the public entity knows to have or claim an interest in the property may apply to the court to withdraw all or any portion of the deposit. Section 1255.260 provides that, “[i]f any portion” of the deposit “is withdrawn, the receipt of any such money shall constitute a waiver by operation of law of all claims and defenses in favor of the persons receiving such payment except a claim for greater compensation.”

Issue:  If a lender holding a lien on condemned property applies to withdraw a portion of the deposit, and the property owner does not object to the application, does the lender's withdrawal of a portion of the deposit constitute a waiver of the property owner's claims and defenses?

Holding: No. A property owner's failure to object to another party's withdrawal request is not a waiver of the owner's claims.

Steve Clowney

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