Glossary

Condemnation

Also known as: Eminent Domain Taking

The exercise of a government's eminent domain power to take private property for public use, whether through a full acquisition of title or a partial taking of an interest such as an easement, subject to the constitutional requirement of just compensation.

Condemnation can be either a total taking (the government acquires the entire fee) or a partial taking (the government acquires only a portion of the property or an easement across it, such as for a road widening), with just compensation for a partial taking sometimes including severance damages if the taking diminishes the value of the owner's remaining land. Loan documents universally include condemnation provisions addressing how any condemnation award is applied — typically requiring that proceeds be paid to the lender and applied to reduce the loan balance or, for a partial, non-material taking, made available for restoration, subject to lender approval rights. A related but narrower doctrine, inverse condemnation, allows a property owner to sue the government for compensation when a regulatory action or physical impairment amounts to a de facto taking without a formal condemnation proceeding having been filed.