Does An LLC Have Eminent Domain Power?

Does An LLC Have Eminent Domain Power?

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Some homeowners living around this construction work don't like it.  Many settled out of fear of losing out to a condemnation lawsuit after a back and forth negotiation with the company.  It ends with some so afraid of violating a non-disclosure agreement they don't want to show their faces.  This man is one of them. 

"Either you accept this final offer or we're going to institute this eminent domain so I felt like I didn't have any choice at that point," said the man who didn't want to be identified.  So what is the law? Alabama grants eminent domain powers to some companies if their projects meet specific criteria.  Warren Herlong is an attorney who represented seven homeowners against the pipeline company.  He argues Southcap doesn't have eminent domain authority because it's technically not the right kind of corporation.

"The plains limited liability company in my opinion does not have the legal authority to condemn," says Herlong.  Probate Judge Don Davis sided with that argument in April, but the seven clients have since settled with Plains.  Herlong says it eminent domain can be used in projects that meet the criteria. 

"The condemning agency if it has the power if it can proceed with those rights it is legally entitled to acquire," says Herlong.  Right now the project is being held up because MAWSS is being sued by Southcap because the water system isn't giving it access to property near Big Creek Lake.  Herlong say Southcap will have to prove it won't interfere with MAWSS use of the property.  It's not clear if MAWSS will use that argument in its defense when the two sides face off in court. 

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