Severance Damages

Severance damages represent compensation awarded to property owners when a portion of their property is condemned and taken for public use. These damages account for the depreciation in value or inconvenience caused to the remaining property.
On this page

Definition

Severance damages refer to the financial compensation awarded to a property owner when a portion of their property is condemned and taken for public use, often as part of an eminent domain action. These damages are intended to cover the loss in value or the inconvenience suffered by the owner due to the reduced utility or accessibility of the remaining property after part of it has been taken.

Examples

  1. Highway Expansion: Suppose a state highway department needs a 100-foot-wide strip of land from the middle of a farm for highway expansion. The department awards the farmer $1,000 per acre for the land taken and additional $15,000 in severance damages to compensate for the inconvenience of traveling from one side of the highway to the other.

  2. Utility Easement: In another instance, a utility company requires a strip of land for running power lines. The property owner is paid for the easement, and severance damages are awarded for the reduced market value of the remaining property due to the visual and practical impact of the power lines.

Frequently Asked Questions (FAQ)

1. How are severance damages calculated? Severance damages are typically calculated based on the reduction in the market value of the remaining property or the inconvenience caused to the property owner. Appraisals and expert testimony may be used to determine the appropriate amount.

2. Can severance damages be awarded even if the remaining property is still usable? Yes, severance damages can still be awarded if the remaining property is usable but has decreased in value or utility due to the partial taking.

3. Are severance damages the same as compensation for the land taken? No, severance damages are separate from the compensation paid for the land taken. The payment for the land taken covers the value of the land itself, while severance damages cover additional losses or inconveniences.

4. Do severance damages apply only to residential properties? No, severance damages can apply to all types of properties, including residential, commercial, and agricultural land.

5. Is there a standard formula for calculating severance damages? There is no single standard formula, as each case is unique. The calculation considers the specific impact on the property’s value and usability, often requiring expert appraisal.

  • Condemnation: The legal process by which a government or public utility takes private property for public use, with compensation to the owner.
  • Eminent Domain: The right of a government or its agents to expropriate private property for public use, with payment of compensation.
  • Compensation: Payment awarded to a property owner for the taking of their property, ensuring they are not financially disadvantaged.
  • Appraisal: An expert’s evaluation of the market value of property, used to determine the amount of compensation.
  • Easement: A legal right to use another’s land for a specific purpose, such as running utilities or access roads.

Online References

Suggested Books for Further Study

  • “Eminent Domain: A Handbook of Condemnation Law” by William Scheiderich
  • “Real Estate Principles: A Value Approach” by David C. Ling and Wayne R. Archer
  • “The Law of Eminent Domain: Fifty-State Survey” by William G. Blake
  • “The Appraisal of Real Estate” by Appraisal Institute

Fundamentals of Severance Damages: Real Estate Law Basics Quiz

Loading quiz…

Thank you for exploring severance damages in the context of real estate law. Your commitment to understanding these principles is commendable!

Severance Pay
Severance Benefit