California Civil Jury Instructions (CACI)
3504. Project Enhanced Value
You must consider any increase or decrease in the property's fair market value caused by public knowledge of [insert entity's purpose for condemning the property] until [insert date of property's probable inclusion]. You may not consider any change in value caused by [insert entity's purpose for condemning the property] after that date. You may, however, consider other factors that changed the property's value after [insert date of property's probable inclusion], but before [insert date of valuation].
Sources and Authority
Code of Civil Procedure section 1263.330 provides: The fair market value of the property taken shall not include any increase or decrease in the value of the property that is attributable to any of the following:
(a) The project for which the property is taken.
(b) The eminent domain proceeding in which the property is taken.
(c) Any preliminary actions of the plaintiff relating to the taking of the property.
"A legitimate element of just compensation lies in the increase in value resulting from a reasonable expectation that a particular piece of property will be outside a proposed public improvement, and thus will reap the benefits of that improvement." (Merced Irrigation Dist. v. Woolstenhulme (1971) 4 Cal.3d 478, 488 [93 Cal.Rptr. 833, 483 P.2d 1].)
"The 'market value' of a given piece of property, of course, reflects a great variety of factors independent of the size, nature, or condition of the property itself. The general character of the neighborhood, the quality of the public and private services, and the availability of public facilities all play important roles in establishing market value. Thus, widespread knowledge of a proposed public improvement, planned for an indefinite location within a given region or neighborhood, will frequently cause the market value of land in the region or neighborhood to rise." (Merced Irrigation Dist., supra, 4 Cal.3d at p. 488.)
"[W]e now hold that increases in value, attributable to a project but reflecting a reasonable expectation that property will not be taken for the improvement, should properly be considered in determining 'just compensation.' " (Merced Irrigation Dist., supra, 4 Cal.3d at p. 495.)
"[I]n computing 'just compensation' in such a case, a jury should only consider the increase in value attributable to the project up until the time when it became probable that the land would be needed for the improvement." (Merced Irrigation Dist., supra, 4 Cal.3d at p. 498.)
8 Witkin, Summary of California Law (9th ed. 1988) Constitutional Law, § 1020
1 Condemnation Practice in California (Cont.Ed.Bar 2005) §§ 4.3-4.8
3 Nichols on Eminent Domain, Ch. 8A, Enhancement, §§ 8A.01-8A.02 (Matthew Bender)
4 Nichols on Eminent Domain, Ch. 12B, Valuation of the Fee Interest, § 12B.17 (Matthew Bender)
(New September 2003)