Code of Virginia

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Code of Virginia
Title 25.1. Eminent Domain
Chapter 3. Transferring Defeasible Title by Certificate
12/8/2021

Chapter 3. Transferring Defeasible Title by Certificate.

§ 25.1-300. Definitions.

As used in this chapter, unless the context requires a different meaning:

"Authorized condemnor" means a condemnor that is specifically authorized by law to acquire property through the use of the procedure set forth in this chapter.

"Certificate" means an instrument that, when recorded in the office of the clerk of the circuit court wherein condemnation proceedings are pending or are to be instituted by an authorized condemnor, terminates the interest or estate of the owner of the property described therein and vests defeasible title to such property or interest or estate of the owner in the authorized condemnor. "Certificate" includes a certificate of deposit and a certificate of take.

"Certificate of deposit" means a certificate filed by an authorized condemnor with the court wherein condemnation proceedings are pending or are to be instituted, stating that any sum or sums designated therein shall be paid pursuant to the order of the court, and which is filed in lieu of the payment of funds into court as provided in subdivision A 2 of § 25.1-305.

"Certificate of take" means a certificate recorded by an authorized condemnor with the court wherein condemnation proceedings are pending or are to be instituted, in connection with which the authorized condemnor has deposited funds with the court as provided in subdivision A 1 of § 25.1-305.

2003, c. 940.

§ 25.1-301. Applicability of chapter; purpose.

A. The procedure established by this chapter shall be available for use, at the election of an authorized condemnor, in connection with the acquisition of property by condemnation if the use of the procedure is specifically authorized by law.

B. It is the intention of this chapter to provide that property may, in the discretion of the authorized condemnor, be condemned as provided in this chapter before, during or after the construction of improvements thereon.

2003, c. 940.

§ 25.1-302. Protection of property.

Authorized condemnors constructing improvements under the authority of this chapter shall use diligence to protect growing crops and pastures and to prevent damage to any property not taken.

2003, c. 940.

§ 25.1-303. Effort to acquire property by purchase.

An authorized condemnor shall comply with the applicable provisions of § 25.1-204 and subdivision A 1 of § 25.1-417 before exercising its authority to acquire property by condemnation under the procedure set forth in this chapter.

2003, c. 940.

§ 25.1-304. Authority to take possession and title to property.

In addition to any authority it has to exercise the power of eminent domain prior to entering upon property being condemned, an authorized condemnor is authorized to acquire title to and to enter upon and take possession of such property for the purposes for which such condemnor is authorized to condemn such property, and proceed with the construction of improvements upon such property, in accordance with the procedures set forth in this chapter.

2003, c. 940.

§ 25.1-305. Authorized condemnor to make payment into court or file certificate of deposit before entering upon land.

A. Before entering upon or taking possession of property, the authorized condemnor shall either:

1. Pay into the court wherein condemnation proceedings are pending, or are to be instituted, such sum as is required by subsection B; or

2. File with the court wherein condemnation proceedings are pending, or are to be instituted, a certificate of deposit issued by the authorized condemnor for such sum as is required by subsection B, which shall be deemed and held for the purpose of this chapter to be payment into the custody of such court.

B. The amount to be paid into the court as provided in subdivision A 1 or represented by a certificate of deposit as provided in subdivision A 2 shall be the amount that the authorized condemnor estimates to be the fair value of the land taken, or interest therein sought, and damage done, which estimate shall be based on a bona fide appraisal if required by § 25.1-417; however, such estimate shall not be less than the current assessed value of the land for real estate tax purposes, unless the property has physically changed in a material and substantial way since the current assessment date such that the real estate tax assessment no longer represents a fair valuation of the property, when the entire parcel for which the assessment has been made is to be acquired.

C. If the condemning authority makes a payment into court as provided in subdivision A 1, it shall also record a certificate of take as provided in § 25.1-307.

D. Payment against a certificate of deposit, when ordered by the court named therein, shall be paid by the authorized condemnor.

E. Nothing in this section shall make evidence of tax assessments admissible as proof of value in an eminent domain proceeding.

2003, c. 940; 2013, c. 764.

§ 25.1-306. Notice of intent to file certificate.

The authorized condemnor shall, between 30 and 45 days prior to the date on which any certificate will be filed or recorded pursuant to this chapter, give notice to the owner or tenant, if known, of the freehold by certified or registered mail that such certificate will be filed or recorded with respect to such person's property. Such notice shall contain the following language, as appropriate: (i) "Between 30 and 45 days from the date of this notice, a certificate of take will be recorded in the land records of the circuit court" or (ii) "Between 30 and 45 days from the date of this notice, a certificate of deposit will be recorded in the land records of the circuit court." Such notice shall also state that upon recordation of the certificate, the defeasible title to the property shall transfer to the condemnor and that the owner has the right to petition the court for distribution of the funds represented by the certificate, subject to any preexisting liens or other encumbrances upon the property. Additionally, within four business days of the filing or recording of a certificate, the authorized condemnor shall give notice of such filing or recording to the owner or tenant, if known, of the freehold by providing a copy of such certificate by certified or registered mail.

2003, c. 940; 2017, c. 563; 2021, Sp. Sess. I, c. 278.

§ 25.1-307. Content of certificates; recordation of certificates.

A. A certificate shall set forth the description of the property being taken or damaged, and the owner or owners, if known, of such property.

B. The authorized condemnor shall record a certificate of take or a certificate of deposit in the clerk's office of the court where deeds are recorded. The clerk shall record the certificate in the deed book and index it in the names of both (i) the person or persons who owned the land before the recordation of the certificate and (ii) the authorized condemnor.

2003, c. 940.

§ 25.1-308. Effect of recordation of certificate; transfer of title or interest in property.

A. Upon recordation of a certificate:

1. The interest or estate of the owner of the property described therein shall terminate;

2. The title to such property shall be vested in the authorized condemnor;

3. The owner shall have such interest or estate in the funds deposited with the court or represented by the certificate of deposit as the owner had in the property taken or damaged; and

4. All liens by deed of trust, judgment or otherwise upon such property shall be transferred to such funds.

B. The title in the authorized condemnor shall be defeasible until (i) the authorized condemnor and such owner reach an agreement as provided in § 25.1-317, or (ii) the compensation for the taking or damage to the property is determined by condemnation proceedings as provided in § 25.1-313.

2003, c. 940.

§ 25.1-309. Property situated in two or more localities.

If the property affected by the certificate is situated in two or more localities, the clerk of the court wherein the certificate is recorded shall certify a copy of such certificate to the clerk of the court of the locality in which any portion of the property lies. The clerk shall record the same in the deed book and index it in the manner prescribed in subsection B of § 25.1-307.

2003, c. 940.

§ 25.1-310. Proceedings for distribution of funds.

A. Any person shown by a certificate to be entitled to funds deposited with the court or represented by a certificate of deposit may petition the court for the distribution of all or any part of the funds. Any costs of filing such petition or otherwise withdrawing the funds shall be taxed against the condemnor.

B. A copy of such petition shall be served on either (i) the attorney of record for the petitioner, if a condemnation proceeding is pending; or (ii) if such a proceeding is not pending, an officer or agent of the authorized condemnor who is authorized to accept service of process in any court proceeding on behalf of the authorized condemnor.

C. The copy of the petition shall be served with a notice returnable to the court not less than 21 days after such service, to show cause, if the authorized condemnor can, why such amount should not be distributed in accordance with the petition.

D. If the authorized condemnor does not, on or before the return day of the petition, show such cause, and if the record in the proceeding does not disclose any denial or dispute with respect thereto, the court shall enter an order directing the distribution of such amount in accordance with the prayers of the petition. However, in the case of a nonresident petitioner the court may in its discretion require a bond before ordering the distribution.

E. If funds have been deposited with the court pursuant to subdivision A 1 of § 25.1-305, any interest that has accrued on the funds shall be payable to the person or persons entitled to receive such funds.

F. If funds are not then on deposit with the court but are represented by a certificate of deposit pursuant to subdivision A 2 of § 25.1-305, a certified copy of such order shall forthwith be sent to the authorized condemnor by the clerk. The authorized condemnor shall deposit such funds with the court within 30 days of the date of such order.

G. Interest shall be payable on funds represented by a certificate of deposit from the date of filing of the certificate of deposit until the funds are paid into court at no less than the judgment rate of interest as set forth in § 8.01-382. However, interest shall not accrue if an injunction is filed against the authorized condemnor that enjoins the taking of the property described in the certificate.

H. If the authorized condemnor shows such cause, or if the record in the proceeding discloses any denial or dispute as to the persons entitled to such distribution or to any interest or share therein, the court shall direct such proceedings as are provided by § 25.1-241 for the distribution of awards.

I. All funds due and owing pursuant to this section shall be payable promptly to the owner or, if the owner consents, to the owner's attorney. Nothing in this subsection shall be construed to alter the priority of liens or any obligation to satisfy or release any outstanding liens on the property or the funds.

2003, c. 940; 2018, c. 842; 2020, c. 1245.

§ 25.1-311. Effect of acceptance of payments; evidence as to amount of deposit or certificate.

A. The acceptance of payment as provided in § 25.1-310 shall not limit the amount to be allowed by the body determining just compensation in a condemnation proceeding, nor limit the rights of any party or parties to the proceeding to appeal from any decision therein.

B. A party to a condemnation proceeding shall not be entitled to introduce evidence of any amount deposited with the court or represented by a certificate, nor of any amount that has been accepted by any party entitled thereto pursuant to § 25.1-310.

2003, c. 940.

§ 25.1-312. Reformation, alteration, revision, amendment, or invalidation of certificate.

A. No reformation, alteration, revision, amendment, or invalidation shall be made to a recorded certificate for any purpose without the prior consent of the court wherein such certificate is recorded.

B. The court shall have jurisdiction to:

1. Reform, alter, revise, amend, or invalidate, in whole or in part, any certificate; and

2. Correct mistakes in the description of the property affected by such certificate, the name or names of the owner or owners in the certificate, or any other error that may exist with respect to such certificate for any other purpose.

C. A petition filed by the authorized condemnor with the court setting forth any error made in such certificate, or the necessity of any change therein, shall be deemed sufficient basis for the reformation, alteration, revision, amendment, or invalidation in whole or in part of such certificate.

D. The court may enter an order permitting the reformation, alteration, revision, amendment or invalidation, in whole or in part, of the certificate. Such order, together with any revised certificate that may be necessary, shall be recorded in the clerk's office in the same manner required for the recordation of a certificate. The filing of any certificate pursuant to the provisions of this section shall not alter the date of taking as established by the recordation of the original certificate pursuant to § 25.1-307 as to any property that is included in the amended certificate. An amended certificate shall not include any property not included in the original certificate.

E. Nothing in this section shall be construed to prohibit or preclude any person from recovering damages in a condemnation proceeding resulting from such reformation, alteration, revision, amendment, or invalidation.

2003, c. 940; 2019, c. 788.

§ 25.1-313. Institution of condemnation proceedings.

The authorized condemnor shall institute condemnation proceedings with respect to property described in a certificate within 180 days of the recordation of the certificate if (i) the authorized condemnor and the owner or owners of property taken or damaged by the authorized condemnor are unable to agree as to the compensation, if any, attributable to such taking or damage or (ii) such agreement cannot be obtained because the owners or one or more of them are under a disability, are unknown, or cannot with reasonable diligence be found within the Commonwealth. However, this section shall not require the institution of condemnation proceedings if they have been instituted prior to the recordation of such certificate.

2003, c. 940; 2017, c. 593.

§ 25.1-314. Order confirming award; recordation.

The final order of the court confirming an award of compensation to the owner or owners of property shall confirm in the authorized condemnor absolute and indefeasible title to the property that is the subject of the condemnation proceeding. Such order shall be recorded in the current land records in the office of each clerk of court in which the certificate was recorded.

2003, c. 940.

§ 25.1-315. Awards in greater amounts than deposit; interest.

A. If the amount of an award in a condemnation proceeding is greater than that deposited with the court or represented by a certificate of deposit, the excess amount, together with interest accrued on such excess amount, shall be paid into court for the person or persons entitled thereto.

B. Interest shall accrue on the excess amount at not less than the judgment rate of interest as set forth in § 8.01-382, computed from the date of such deposit to the date of payment into court and be paid into court for the person or persons entitled thereto. However, any interest that accrued before July 1, 1970, shall be paid at the rate of five percent, and interest accruing thereafter and prior to July 1, 1981, shall be paid at the rate of six percent, and any interest accruing thereafter and prior to July 1, 1994, shall be paid at the rate of eight percent.

2003, c. 940; 2017, c. 710.

§ 25.1-316. Awards in lesser amounts than deposit; interest.

If the amount of an award in a condemnation proceeding is less than that deposited with the court or represented by a certificate of deposit, and the person or persons entitled thereto have received a distribution pursuant to § 25.1-310 of such funds, the authorized condemnor shall recover (i) the amount of such excess and (ii) interest on such excess at the general account's primary liquidity portfolio rate. If any person has been paid a greater sum than that to which he is entitled as determined by the award, judgment shall be entered for the authorized condemnor against such person for the amount of such excess and interest.

2003, c. 940.

§ 25.1-317. Agreements as to compensation; petition and order of court thereon; disposition of funds.

A. At any time after the recordation of a certificate, but prior to the institution of condemnation proceedings, if the authorized condemnor and the owner of the property taken or damaged agree as to compensation for the property taken and damages, if any, caused by such taking, the authorized condemnor shall file with the court a petition so stating. A copy of the agreement shall be attached to the petition. If condemnation proceedings are already pending at the time such agreement is reached, the authorized condemnor shall not be required to file a petition, but shall file a motion to dismiss the condemnation proceedings containing an averment that such agreement has been reached. Upon the filing of such a petition or a motion to dismiss, the court shall enter an order confirming absolute and indefeasible title to the property in the condemning authority, or in the Commonwealth if the condemning authority is an agency of the Commonwealth. Such order shall be recorded in the clerk's office of each court in which the certificate is recorded. Upon entry of such order, the condemning authority shall be relieved of further obligation by virtue of having filed a certificate of deposit with the court.

B. If it shall appear from such petition and agreement, or motion to dismiss a pending suit, that no person other than those executing such agreement are entitled to the funds deposited with the court or represented by a certificate of deposit, the court shall direct that such funds, after payment therefrom of any taxes that may be charged against the property taken, be disbursed and distributed in accordance with the provisions stated in the petition, or motion, among the parties or persons entitled thereto. If it shall appear that a controversy exists as to the persons entitled to such funds, such distribution shall be made in accordance with the provisions of § 25.1-310.

2003, c. 940.

§ 25.1-318. Petition by owner for determination of just compensation.

A. The owner of property that an authorized condemnor has entered and taken possession of, or taken defeasible title of, pursuant to the provisions of this chapter may petition the circuit court of the locality in which the greater portion of the property lies for the appointment of commissioners or the empanelment of a jury to determine just compensation for the property taken and damages done, if any, to such property, as provided in Chapter 2 (§ 25.1-200 et seq.) if (i) the owner and the authorized condemnor have not reached an agreement as to compensation and damages, if any, and (ii) the authorized condemnor:

1. Has not completed the construction of the contemplated improvements upon the property after a reasonable time for such construction has elapsed; or

2. Has not instituted condemnation proceedings within:

a. Sixty days after completion of the construction of the contemplated improvements upon the property;

b. One hundred eighty days after the authorized condemnor has entered upon and taken possession of the property, regardless of whether the construction of the contemplated improvements has been completed; or

c. One hundred eighty days after the recordation of a certificate.

B. A copy of such petition shall be served upon the authorized condemnor at least 10 days before it is filed in the court. The authorized condemnor shall file an answer thereto within five days after the filing of the petition. If the court finds that the conditions prerequisite for such appointment as provided in subsection A are satisfied, the court shall appoint commissioners or empanel a jury, as requested in the owner's petition, to ascertain the amount of compensation to be paid for the property taken and damages done, if any. The proceedings shall thereafter be governed by the procedure prescribed by Chapter 2 (§ 25.1-200 et seq.) insofar as the same may be applicable.

2003, c. 940; 2006, c. 586; 2010, c. 835; 2017, c. 593.