Nevada's Eminent Domain Laws and Property Rights

The following responses are intended to provide general information about eminent domain laws in the featured state. Such information does not constitute legal advice. Anyone interested in learning more about eminent domain law and the impact it may have on a given set of facts should consult with an OCA attorney or another attorney experienced in handling eminent domain cases.

• Who Can Exercise Eminent Domain Laws?

  Essentially, the State of Nevada, its political subdivisions, agencies, and in some limited circumstances private agencies or entities have the power of eminent domain.

• What Are the Legal Requirements for Exercising the Power?

  Property in Nevada can only be taken for a public purpose upon the payment of just compensation. Chapter 37 of the Nevada Revised Statutes (NRS) sets forth the process and procedures for initiating a condemnation action.

• What Limitations or Defenses Exist?

  No judgment of condemnation shall be entered unless the court first finds that:
  a. The use to which the property is to be applied is a public use;
  b. The property is necessary to such public use; and
  c. If the property is already appropriated to some public use, the public use to which it is to be applied is a more necessary public use.

• What Constitutes a Public Purpose?

  NRS 37.010 identifies a long list of “public uses” for which eminent domain may be exercised. However, as a result of Art. 1, § 22 in the Nevada Constitution, public use shall not include the direct or indirect transfer of any interest in property taken in an eminent domain proceeding from one private party to another private party. In all eminent domain actions, the government shall have the burden to prove public use.

• How is Just Compensation Determined?

  In all eminent domain actions, just compensation shall be defined as that sum of money, necessary to place the property owner back in the same position, monetarily, without any governmental offsets, as if the property had never been taken. Just compensation shall include, but is not limited to, compounded interest and all reasonable costs and expenses actually incurred.

• How Is Fair Market Value Defined?

  Under Nevada law, fair market value includes the highest price the property would bring on the open market. Moreover, as a result of Art. 1, § 22 in the Nevada Constitution, both the taken and damaged property must be valued at its highest and best use, without considering any future dedication requirements imposed by the government. In situations where private property is taken for any proprietary governmental purpose, then the property must be valued at the use to which the government intends to put the property, if such use results in a higher value for the land taken.

• What About Recovering Damages to Remaining Property

  In all eminent domain actions, just compensation includes that sum of money, necessary to place the property owner back in the same position, monetarily, without any governmental offsets, as if the property had never been taken. This would, of course, include damages to any remaining property as well. Moreover, in State v. Cowan, 210 P.3d 769 (Nev. 2007) the Nevada Supreme Court held that lessees were entitled to compensation for destruction of their business as an exception to the undivided-fee rule. The court also held that business goodwill, rather than lost profits, was the appropriate measure of damages for the complete destruction of the lessees’ business.

• Is the Landowner Entitled to Recover Reasonable Attorney Fees? Expert Fees? Litigation Costs?

  The government agency is usually required to pay interest on any award of “just compensation.” The property owner is also entitled to recover costs actually incurred which are related to and part of the litigation. The property owner’s attorneys’ fees may also be recoverable in certain situations.