Every condemnation case in Texas must go through an administrative phase in which disinterested real property owners (who live in the county where the suit is filed) are appointed as Special Commissioners to assess the market value of the property being condemned and damages, if any, to the remainder property and render an Award on compensation after hearing testimony and evidence from both sides at a Special Commissioners Hearing.
Appointment of Special Commissioners:
Once a condemnation petition is filed a judge will appoint three disinterested real property owners and two alternates, who reside in the county where the condemnation petition is filed, no later than 30 calendar days after the petition is filed. [TX Property Code 21.014 (a)].
Strike Period:
Unlike baseball where you get three strikes, each party in a condemnation suit gets one strike. Each party has the option of striking one of the three special commissioners as long as they do so within 10 calendar days of the Order Appointing the Special Commissioners or 20 days after the petition was filed. If a special commissioner is struck, an alternate will serve as a replacement based on the order in which the alternate is listed in the initial Order Appointing Special Commissioners. [TX Property Code 21.014 (a)].
To Strike or Not to Strike?
Exercising or not exercising a strike can be a strategic move. So, what if a party waits until the last day in the “Strike Period” to file a strike and the alternate is not someone you want to serve as a special commissioner? Well, you are in luck if you haven’t already exercised a strike since you can strike that commissioner if you do so within 3 days of when the other party exercised their strike. [TX Property Code 21.014(a)]. Note: the other alternate commissioner listed in the initial Order Appointing Special Commissioners will become the replacement for the commissioner you strike, so take that into consideration before exercising a strike.
Notice of Hearing:
Once a hearing has been set, an Order Setting Hearing Before Special Commissioners is signed by the three special commissioners, who took and filed an oath to serve as a special commissioner, and provided to the condemnor who must provide a copy of the signed Order to the property owner and all other parties by certified mail return receipt requested. [TX Property Code 21.014(d)]. Thereafter, a Notice of Hearing must be served by the condemnor on all parties at least 20 days before the date of the hearing. The Notice of Hearing may be served on the party or the party’s agent or attorney. Upon completion of service, a return of service should be filed with the court on or before the day of the hearing. [TX Property Code 21.016]. Note: A Waiver of Notice of Hearing (waiving the 20-day notice) can be executed and filed with the court in lieu of serving a Notice of Hearing.
At the Hearing: Let the Games Begin…
Luckily, a Special Commissioners’ Hearing is not like the “Hunger Games” but it can be analogous to the “Wild West” with a sense of lawlessness given that the Texas Rules of Evidence and Texas Rules of Civil Procedure do not apply at the hearing.
At the hearing, opening statements may be made by each of the parties and then the condemnor puts on their case: direct and cross examination of witnesses (i.e. engineer & appraiser) and then the property owner puts on their case: direct and cross examination of witnesses (i.e. appraiser, possibly a land planner or the property owner may testify) then the hearing usually concludes with the parties each making closing arguments. Afterwards, the Special Commissioners deliberate and render a decision on compensation and an Award is filed with the court.
Special Commissioners have Limited Power/Authority:
Special Commissioners are given authority to hear the evidence at a Special Commissioners’ Hearing and assess the amount of damages fairly, impartially, and according to the law. [TX Property Code 21.014 (b)]. They are also given the power to compel the attendance of witnesses and the production of testimony, administer oaths and punish for contempt in the same manner as a county judge. [TX Property Code 21.014 (c)].
Proceeding with Two Commissioners:
What should you do if you find out before a hearing that only two commissioners are able to attend?
- Confirm in writing that the commissioner cannot attend the hearing;
- File a Motion to Substitute that commissioner and make sure to attach the written confirmation that the commissioner cannot attend the hearing as an exhibit; and
- Provide a courtesy copy of the Motion to Substitute to the Judge’s staff especially if the situation is time sensitive given the date of the hearing.
What should you do if you find out at a hearing that one of the commissioners is not able to attend?
Texas Property Code 21.014 states in pertinent part: “The judge…shall appoint three disinterested real property owners who reside in the county as special commissioners….” The rule doesn’t say that you “MUST” have all three commissioners in attendance at a hearing in order to proceed with the hearing or that you cannot proceed with the hearing if only two of the commissioners are present. Therefore, absent any local court rules on this topic, if the condemnor and condemnee (property owner) agree on the record or in writing to have the hearing with only two commissioners present, the hearing may proceed. Note: there is case law to support an award entered by two special commissioners.
When should the Award be filed with the Court?
Once the commissioners have assessed the damages, they should make a written statement of their decision (i.e., Award of Special Commissioners) that is dated, signed and filed with the court on the day the decision is made or on the next working day after the day the decision is made. [TX Property Code 21.048].
Objection Period: How long do I have to file objections?
Texas Property Code 21.018 states in relevant part: If a party to a condemnation proceeding wants to file an objection to the findings (Award) of the Special Commissioners, the objection must be filed on or before the first Monday following the 20th day after the commissioners file their findings with the court.
What happens if no objections are filed to the Special Commissioners Award?
If no objections are filed within the applicable objection period and the condemnor has already deposited the amount of the Award into the registry of the court, the condemnor can file a Judgment Absence Objections (JAO) for the Judge’s signature. Once the judge signs the JAO, the case can be closed. Note: A JAO cannot be filed until the condemnor deposits the amount of the Award into the registry of the court.
Possession - Notice of Deposit
Once the condemnor deposits the amount of the Special Commissioners Award into the registry of the court, the condemnor may take possession of the property being condemned pending the results of further litigation. [TX Property Code 21.021].
Key takeaway: Once a Special Commissioners Hearing is held, an Award is rendered, and the condemnor deposits the amount of the Award into the registry of the court, the condemnor can take possession of the property while the suit is pending if objections are filed to the Award.
What’s it all for? Judicial Economy
Given that a Special Commissioners Hearing is not your typical hearing and it is more like a mini-trial (opening statements, direct & cross examinations, and closing statements) where the commissioners determine the amount of compensation and damages, if any, for the property being condemned, the parties are in a better position after the Special Commissioners Hearing to evaluate each of their respective cases (strengthens and weaknesses) and consider settlement before spending a lot of time and money litigating the case. For that reason, many cases are often resolved following the administrative phase which enables our courts to be more efficient.
