California Civil Jury Instructions (CACI) (2017)

3507. Personal Property and Inventory

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3507.Personal Property and Inventory
Just compensation also includes the loss of any inventory or personal
property caused by the taking. [Name of property owner] may be entitled
to the retail value of the inventory or personal property if the property
is unique and not readily replaceable. Otherwise, [name of property
owner] is entitled to wholesale value.
New September 2003
Sources and Authority
• “The Fifth Amendment of the United States Constitution, as applied to the
states by the Fourteenth Amendment, conditions the power of eminent domain
upon the payment of ‘just compensation.’ That constitutional requirement makes
no distinction between real property and personal property. If personal property
is taken by the government in the exercise of its eminent domain power, it must
compensate the owner.” (City of Needles v. Griswold (1992) 6 Cal.App.4th
1881, 1891 [8 Cal.Rptr.2d 753].)
• “We further acknowledge that where a condemner takes certain real property
and the removal or relocation of either tangible or intangible personal property
is impossible due to the condemnatory act, the owner is entitled to be justly
compensated for the loss of property, regardless of its nature.” (San Diego
Metropolitan Transit Development Bd. v. Handlery Hotel, Inc. (1999) 73
Cal.App.4th 517, 533 [86 Cal.Rptr.2d 473], internal citations omitted.)
• “The general rule is that the Constitution does not require compensation for
personal property not affixed to the condemned realty. Movable items of
personal property are not ‘taken’ by the public entity when it condemns real
property or a business; instead, under the Relocation Assistance Act, the public
entity compensates the owner for the cost of moving the personal property to a
new site.” (County of San Diego v. Cabrillo Lanes, Inc. (1992) 10 Cal.App.4th
576, 583 [12 Cal.Rptr.2d 613].)
• “Business inventory may be compensable under limited circumstances, i.e.,
where the loss results from the condemnatory act itself (e.g., the inventory
cannot be relocated) rather than the personal circumstances of the condemnee
(e.g., the owner has decided that he will not relocate).” (Chhour v. Community
Redevelopment Agency of Buena Park (1996) 46 Cal.App.4th 273, 283 [53
Cal.Rptr.2d 585].)
• “The goal of the eminent domain trial [is] ‘to determine just compensation,’ to
wit, to put [condemnee] in ‘as good a position’ as if its business inventory had
‘not been taken.’ However, [condemnee] was only ‘entitled to be reimbursed for
the actual value of what [it] lost—no more and no less.’ ” (People ex rel. Dept.
of Transportation v. Clauser/Wells Partnership (2002) 95 Cal.App.4th 1066,
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1072–1073 [116 Cal.Rptr.2d 240], internal citations omitted.)
• “To award [condemnee] retail value instead of wholesale value would result in
a windfall to [condemnee]—an award in excess of just compensation sufficient
to make [condemnee] whole. Here, the proper standard of fair market value is
the wholesale value. This is what a retailer, whose inventory of nonunique,
fungible, and readily replaceable goods is damaged as a result of an act of
inverse condemnation, should receive.” (McMahan’s of Santa Monica v. City of
Santa Monica (1983) 146 Cal.App.3d 683, 700 [194 Cal.Rptr. 582].)
• In People ex rel. Dept. of Transportation, supra, the court held that a jury
should have been allowed to consider expert witnesses’ testimony on valuation
of inventory based both on retail and wholesale value: “[A]lthough any ‘just
and equitable’ method could be proper, the jury would remain ‘free to accept or
reject’ [an expert’s] valuation.” (People ex rel. Dept. of Transportation, supra,
95 Cal.App.4th at p. 1083, internal citation omitted.)
• “[T]he general rule in eminent domain actions is that ‘the right to a jury trial
. . . goes only to the amount of compensation. All other questions of fact, or
mixed fact and law, are to be tried . . . without reference to a jury.’ ”
(Emeryville Redevelopment v. Harcros Pigments (2002) 101 Cal.App.4th 1083,
1116 [125 Cal.Rptr.2d 12], original italics, internal citations omitted.)
Secondary Sources
8 Witkin, Summary of California Law (10th ed. 2005) Constitutional Law, § 1247
1Condemnation Practice in California (Cont.Ed.Bar 3d ed.) § 4.56
4 Nichols on Eminent Domain, Ch. 13, Fair Market Value—Physical Character,
§§ 13.11, 13.18[8] (Matthew Bender)
20 California Forms of Pleading and Practice, Ch. 247, Eminent Domain and
Inverse Condemnation, § 247.136 (Matthew Bender)
CACI No. 3507 EMINENT DOMAIN
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