Expropriation and the Partial Taking Appraisal

Expropriation and the Partial Taking Appraisal Sponsor: IRWA Annual Conference Date: June 29, 2010 Location: Presenter: Calgary, AB Gord MacNair, AACI, P.App, SR/WA macnairg@rogers.com Copyright Gordon E. MacNair, AACI, P.App, SR/WA 1

Presentation Outline Overview on Expropriation & Partial Taking What is the Larger Parcel? Value of Part Taken Remainder Cost to Cure Injurious Affection & Disturbance Damages Benefits (General & Special) Case Studies & various Expropriation Acts Copyright Gordon E. MacNair, AACI, P.App, SR/WA 2

Partial Taking Objectives Objectives: Identify valuation techniques used in Partial Taking Review various components of compensation Identify available resources for information on expropriation Copyright Gordon E. MacNair, AACI, P.App, SR/WA 3

Expropriation vs. Surface Rights Act Generally the Expropriation Act is concerned with expropriations by the Crown and municipalities i.e. highways, water, sewer, etc. Surface Rights Act applies to pipelines, telephone lines and power transmission lines. The focus of this seminar relates to compensation under the Expropriation(s) Act. Copyright Gordon E. MacNair, AACI, P.APP, SR/WA 4

Issues related to a Partial Taking Where only a portion of the larger parcel is acquired, it is known as a Partial Taking. It can be obtained through negotiation (majority) or expropriation. With a partial taking, we are concerned about the following: - Larger Parcel/Donor Parcel/Parent Parcel - The taking itself - The remainder (what is left) - Before & After Value An appraisal for a partial taking involves appraisal principles and case law. The difficulty with a partial taking is that the owner is left with something less than what he/she had in the first place. Copyright Gordon E. MacNair, AACI, P.App, SR/WA 5

Real Estate Theory Bundle of Rights Theory The rights of ownership are often referred to as the Bundle of Rights Theory which affirms that ownership of property involves a bundle of privileges. This concept has its origins in Roman law. Like a bundle of sticks, each one represents a distinct and separate right or interest. Included in the bundle of rights: 1. Right of Possession 2. Right to Exclude others 3. Right of Disposition 4. Right of Using 5. Right of Enjoying the Fruits and Profits of Land 6. Right of Destroying or Injuring Property Copyright Gordon E. MacNair, AACI, P.App, SR/WA 6

Terminology Canada expropriate United States eminent domain describes the right and condemnation describes the exercise of the right England compulsory taking Copyright Gordon E. MacNair, AACI, P.App, SR/WA 7

History of Expropriation Until the late 1960 s, procedures regarding expropriation varied across Canada. The various statutes authorizing expropriation were inconsistent. The Federal and majority of Provincial Acts came into play in the 1960 s with B.C. being the last Province to introduce an Act in 1986. www.expropriationlaw.ca www.landcompensation.com www.bcexpropriationassociation.ca www.oea.on.ca Copyright Gordon E. MacNair, AACI, P.App, SR/WA 8

Right to Compensation for Taking of a Property Right? In Canada, no right to compensation unless conferred by statute. No constitutional right unlike the U.S. with it s Fifth Amendment that provides for just compensation. Sisters of Charity of Rockingham v. The King, [1922] 2A.C.315(Privy Council) Compensation claims are statutory and depend on statutory provisions. No owner of lands expropriated by statute for public purposes is entitled to compensation, either for the value of land taken, or for damage on the ground that his land is injuriously affected, unless he can establish a statutory right. Copyright Gordon E. MacNair, AACI, P.App, SR/WA 9

Expropriation (Heads of Claim) Principles of compensation (Alberta Act) 42(1) When land is expropriated, the expropriating authority shall pay the owner the compensation as is determined in accordance with this Act. (2) When land is expropriated, the compensation payable to the owner must be based on (a) (b) (c) (d) the market value of the land, the damages attributable to disturbance, *the value to the owner of any element of special economic advantage to the owner arising out of or incidental to the owner s occupation of the land to the extent that no other provision is made for its inclusion, and damages for injurious affection. *In Expositio v. Edmonton (1981), 23 LCR 81 the Board found this test met in the circumstances of the owner s home being located immediately beside their premises. This saved the owners a great deal of time and expense otherwise spent in travelling and added a measure of security from theft and vandalism to the store premieses. Copyright Gordon E. MacNair, AACI, P.APP, SR/WA 10

Partial Taking The requirement for a partial taking can involve any of the following: the fee simple interest the acquisition of a lesser interest such as an easement, covenant, etc. a temporary working easement for a specific time, or any combination thereof Copyright Gordon E. MacNair, AACI, P.App, SR/WA 11

Considerations in a Partial Taking A change in the highest and best use (h & bu) Ingress & egress Change in size & shape Change in grade, topography & drainage Increased costs in developing remainder Increased fixed costs In summary, what part of the Bundle of Rights has the owner lost Important principles in a Partial Taking are h & bu, Consistent Use, and Contribution Copyright Gordon E. MacNair, AACI, P.App, SR/WA 12

Principle of Highest & Best Use H & BU is the cornerstone of every appraisal and can be defined as that use which is likely to produce the greatest net return in money or amenities to land over a given period of time With a partial taking appraisal, the appraiser might have two separate H& BU estimates Highest and Best Use and partial acquisitions, Todd Pickett, Canadian Appraiser 2006 Copyright Gordon E. MacNair, AACI, P.App, SR/WA 13

Highest and Best Use 2010 CUPAP (12.34) May be defined as that reasonably probable and legal use of vacant land or as an improved property which is physically, appropriately supported, financially feasible, and that results in the higher value. H & BU is an economic concept that measures the interaction of four criteria: Legally permissible, physically possibility, financially feasible and maximum profitability. Copyright Gordon E. MacNair, AACI, P.App, SR/WA 14

Case Law related to H&BU In Minute Muffler Installations Ltd. v. R (1981), 23 L.C.R.213, the Board set out four primary criteria or tests to be applied in determining h & bu: 1. The use must be legal 2. The use must be probable 3. There must be a demand for the use. 4. The use must be profitable.. These tests were also applied in Trimble v. Alberta (Minister of the Environment) (1983), 27 L.C.R. 313 To research case law in Alberta www.surfacerights.gov.ab.ca/lcb/ Copyright Gordon E. MacNair, AACI, P.App, SR/WA 15

The issue of Highest and Best Use was also addressed in Farlinger Developments Ltd. and Borough of East York (1976) which dealt with the relationship between zoning restrictions and the concept of Highest and Best Use in an expropriation where Howland, J.A. stated the following guiding principles: From these authorities it would seem to be established that the highest and best use must be based on something more than a possibility of rezoning. There must be a probability or a reasonable expectation that such rezoning will take place. It is not enough that the lands have the capability of rezoning. In my opinion, probability Probability connotes something higher than a 50% possibility. Copyright Gordon E. MacNair, AACI, P.App, SR/WA 16

Another important principle to consider with partial takings is the Principle of Consistent Use. The underlying premise with this principle is that when improved land is in a state of transition to another Highest and Best Use, it cannot be appraised with one use allocated to the land and another to the building or improvements. This is an important principle that will be addressed in more detail under the Injurious Affection section with respect to double recovery. Copyright Gordon E. MacNair, AACI, P.App, SR/WA 17

Other principles such as Contribution need to be considered in a partial taking. The Principle of Contribution is based on the value of a particular component being measured by its contributory value to the property, or by the amount its absence detracts from the whole. Since this principle applies to the two main ingredients that make up the value of real property, e.g. land and improvements, the utility of either component could be affected by a partial taking. Copyright Gordon E. MacNair, AACI, P.App, SR/WA 18

Definition of an Appraisal Report Bamborough v. Minister of Housing for Ontario (1974) 7 L.C.R. 103 The acquiring authority s offer of compensation was accompanied by an appraisal report comprising a two page document and a schedule listing the sale prices of three properties. The court held that the latter was not an appraisal report within the meaning of the Act [Section 25(2)] and determined that the person whose property is being expropriated should be able to determine from the appraisal report if he should proceed to arbitration or should accept the offer which has been made. This was not possible on the basis of the document which was served on the applicants. Copyright Gordon E. MacNair, AACI, P.App, SR/WA 19

Effective Date The Alberta Act contains no statement of the valuation date in determining compensation. *It has been held the effective valuation date is the date upon which title vests in the authority, namely the date of registration of the certificate of approval (date of registration of the plan of expropriation according to Waque) BC the date the vesting notice is filed in the LTO under Section 23. NS is when the expropriation documents are deposited in the office of the registrar of deeds. In Ontario, the owner can choose from 3 dates. *The Law of Expropriation and Compensation in Canada, Second Edition, pg. 92 Copyright Gordon E. MacNair, AACI, P.APP, SR/WA 20

Competence 2010 CUSPAP (5.12) 5.12.1 Prior to accepting an assignment or entering into an agreement to perform an assignment, an appraiser must properly identify the problem to be addressed and have the knowledge and experience to complete the assignment competently; or alternatively: 1. Disclose the lack of knowledge and/or experience to the client before accepting the assignment; and 2. Take all steps necessary or appropriate to complete the assignment competently; and 3. Describe the lack of knowledge and/or experience and the steps taken to complete the assignment competently in the report. Copyright Gordon E. MacNair, AACI, P.App, SR/WA 21

Valuation of the Whole (Larger Parcel) Objectives: The first step in a partial taking is to determine the Before Value before the taking Establishing the Larger Parcel is analogous to building the foundation for your house Expropriation & Condemnation: The Larger Parcel, by Tony Sevelka, MAI, AACI The Appraisal Journal, January 2003 Copyright Gordon E. MacNair, AACI, P.App, SR/WA 22

The Larger Parcel [1] The term larger parcel is defined as the subject property when considered together with contiguous or nearby property, the value of which is impacted by common ownership. 612118 Ontario Ltd. V. Ontario (Ministry of Trans) 64/5 [1] 2010 CUSPAP, Definitions 2.38 Copyright Gordon E. MacNair, AACI, P.App, SR/WA 23

The Larger Parcel, CUSPAP 2010 12.27.2 Appraisal of a partial taking through expropriation may require consideration of the larger parcel and injurious affection (loss in value to the remainder). Expert Witness, the Foresnsic Appraiser, Mike Grover, AACI AIC Website Copyright Gordon E. MacNair, AACI, P.App, SR/WA 24

The purpose of establishing the Larger Parcel is that it sets the stage for establishing the value of the part taken, injurious affection and special benefits. In order to establish the Larger Parcel, 3 tests must be satisfied. The three tests for the Larger Parcel are Unity of Title (ownership), Unity of Contiguity (adjoining or separated), and Unity of Use (under one highest and best use). The concept of the three tests is also referenced in some Expropriation Acts under the definition of injurious affection which partially states and for the purposes of this clause, part of the lands of an owner shall be deemed to have been acquired where the owner from who lands are acquired retain lands contiguous to those acquired or retain lands of which the use is enhanced by unified ownership with those acquired (emphasis added). Copyright Gordon E. MacNair, AACI, P.App, SR/WA 25

Bands of Land Value Zoning Use - current or anticipated Natural topography and soil quality Cases: Helenslea Farming Ltd. v. County of Parkland No. 31 et al 33 L.C.R. 133 Hallman v. City of Niagara Falls, 9 L.C.R. 149 Lorenz et al v. City of Lloydminister, 26 L.C.R. 157 CNR Co. v. Industrial Estates Ltd., 35 L.C.R. 220 Grand Forks case Copyright Gordon E. MacNair, AACI, P.App, SR/WA 26

Larger Parcel Double Alpha Holdings Corp.v.Pacific Coast Energy Corp(1998),65 L.C.R. 99 (B.C.E.C.B.) A 1600 acre development property comprising a number of parcels containing radically different areas, the board concluded the larger parcel was a 25.56 acre parcel. It defined this block as the larger parcel because of the natural boundaries caused by the roads, the creek and the municipal border and the fact that it is a discrete parcel intended for development separate from the other areas Copyright Gordon E. MacNair, AACI, P.App, SR/WA 27

Case Study A Requirement Apartments What is the larger parcel? Both parcels under same ownership. Highway Service Station Copyright Gordon E. MacNair, AACI, P.App, SR/WA 28

Case Study B What is the larger parcel? Total size is 147 acres (110 acres + 37 acres) Both parcels are under same ownership Refer to Kerr 20 LCR 67 (1980) & Kerr 22 LCR 179 (1981) Open Space Recreational Highway Highway Commercial Requirement Copyright Gordon E. MacNair, AACI, P.App, SR/WA 29

When it is Not necessary to Value Entire Parcel CUSPAP 2010 (12.27.1) Fractional Interest An appraiser does not generally have to value the whole of a property (or the larger parcel) when the subject of an appraisal is a small component. Case Law on this point. Roman Catholic Episcopal Corp.Toronto v. Metro Toronto & Region Conservation Authority (1978), 15 L.C.R. 133 where bldgs are located on part of the owner s land and these lands are not affected by the expropriation, they may, and in some cases should be, excluded from the determination of market value, both before and after. Copyright Gordon E. MacNair, AACI, P.App, SR/WA 30

Valuation of the Part Taken Objectives: This is the second step in a partial taking appraisal r.o.w. Copyright Gordon E. MacNair, AACI, P.App, SR/WA 31

Valuation of the Part Taken Value the part taken as part of the whole Not appraised as a separate parcel Copyright Gordon E. MacNair, AACI, P.App, SR/WA 32

Valuation of the Part Taken Taking off the Back Theory taking off the front end of the back band use when bands of value can move, zoning can change and access rights are not altered do not use when topographic conditions vary, zoning restrictions cannot be changed and other legal restrictions Gentle v. RMOC 14/167 Copyright Gordon E. MacNair, AACI, P.App, SR/WA 33

The Homogeneous Rule The homogeneous rule, developed in the Bonaventure case and qualified in Kerr, was applied in Lorenz v. Lloydminister (1982), 26 LCR 157, when the value of river flat land was determined, not on the basis of the overall per acre value of the parcel affected, but on the per acre value of the river flat land area which the taking was homogeneous. Flat land $1,000/ac; Riverbank land $450/ac Source: New Law of Expropriation Copyright Gordon E. MacNair, AACI, P.App, SR/WA 34

The Blackstock Formula The Blackstock formula is a principle of compensation for injurious affection which requires an authority to pay 50 per cent or more for the part taken than the average per acre value of the land from which the part is taken. Copyright Gordon E. MacNair, AACI, P.App, SR/WA 35

Case Study taking The expropriating authority requires 5 acres of land from the larger parcel which contains 100 acres. The lands are vacant and are presently zoned industrial within the City of New Mills. The taking is for road widening purposes. 100 acre parcels similar to the subject are selling for $1,500,000 whereas 5 acre parcels are selling for $ 175,000. There is no injurious affection. What is the just compensation payable to the owner? Refer to Bonaventure 17 LCR 161 (1979) & 22 LCR 327 (1981) GTE Sylvania Canada Ltd. V. British Columbia Transit, (1991) B.C.J.No.2(Q.L.)(B.C.C.A.) Copyright Gordon E. MacNair, AACI, P.App, SR/WA 36

Valuation of the Remainder as Part of the Whole and as a Separate Parcel Objectives: This is a two step process First, we will look at the Remainder as Part of the Whole which is the third step in the process. And second, we will learn how to estimate the value of the remainder, after taking and before consideration of special benefits, by a whole new independent appraisal, as a separate parcel. Copyright Gordon E. MacNair, AACI, P.App, SR/WA 37

Step 3 - Remainder (as part of the Whole) The remainder as part of the whole is the difference between the larger parcel and the take Remainder as part of the whole = Larger Parcel (less) Part Taken Copyright Gordon E. MacNair, AACI, P.App, SR/WA 38

Step 4 - Remainder (as a Separate Parcel) Remainder is valued as a separate parcel Disregard any special benefits Most difficult part of partial taking appraisal Might require a new Highest and Best Use Jackson v. Foothills (Municipal District) No. 31 57/112 Copyright Gordon E. MacNair, AACI, P.App, SR/WA 39

Features Affecting Value of the Remainder Accessibility Loss of parking (Marcus v. Municipality of Metro Toronto 8/359) Size and configuration Drainage Topography Elevation Functional utility of improvements Visibility Copyright Gordon E. MacNair, AACI, P.App, SR/WA 40

Valuation of Remainder Value after Acquisition Most difficult Visualize future conditions Use or utility Desirability Highest and Best Use After Lack of setbacks results in a zoning violation Legal non-conforming use Over improvement Ramey v. The Queen 36/97 Copyright Gordon E. MacNair, AACI, P.App, SR/WA 41

Injurious Affection and Damages The concept of injurious affection is based upon the reduction in the value of remaining lands resulting from an expropriation or taking. Alternatively, it is a loss in value to the remainder property as a result of a partial taking. Examples of injurious affection include landlocking, loss of parking, proximity to hydro transmission towers, loss of access, change in shape, loss of exposure and visibility. It is interesting to note that in the U.S. the term injurious affection is not used, as damages are considered to be either consequential or severance. Copyright Gordon E. MacNair, AACI, P.App, SR/WA 42

Summary: Valuation of Remainder Remainder is appraised as part of the larger parcel. Next step is to consider the remainder as a separate parcel after taking, and before consideration of special benefits Main considerations are access, size, shape, off-site improvements, functional utility, elevation & topography Copyright Gordon E. MacNair, AACI, P.App, SR/WA 43

Compensation The total amount of money due a property owner as payment for real property acquired under expropriation e.g.. market value, damages, etc. Some provinces refer to this as Due Compensation whereas the states refers to it as Just Compensation. Copyright Gordon E. MacNair, AACI, P.App, SR/WA 44

Two Primary Approaches for Partial Takings Before & After Method Difference in value between Before and After conditions May result in no payment for part taken and therefore benefits expropriating authority The Canada Acts precludes the use of this Method There is no provision in the Alberta Act for the B & A Method The Ont, BC, NS and others state that it may be used US Federal Act supports this method Summation, Aggregate or Market Value plus Method Value of the take, plus any damages less special benefits Used in many jurisdictions Shows separately the values of the part taken, damages and/or special benefits Favors the owner Belleville Livestock Sales Co. v. Belleville (1974), 6 L.C.R. 189 Copyright Gordon E. MacNair, AACI, P.App, SR/WA 45

Important Consideration Notwithstanding the two methods, whenever a part of an owner s land is taken in Canada, the Courts will want to see a just result in that the owner is always compensated for at least the part taken. Dealt with under Set-off provisions in various Expropriation Acts Copyright Gordon E. MacNair, AACI, P.App, SR/WA 46

Cost to Cure Objectives: We will learn how to recognize those features of a partial taking that could be cured by the cost of construction or replacement. Copyright Gordon E. MacNair, AACI, P.App, SR/WA 47

Cost to Cure This method is used in situations where a property has suffered a damage which can be physically and economically corrected Under no circumstances can the cost to cure exceed the diminution in value, in other words, it must make economic sense to apply the cost of cure as a measure of damage. Crocker v. Municipality of Metro Toronto 21/297 Copyright Gordon E. MacNair, AACI, P.App, SR/WA 48

Cost to Cure A method that can be used to offset damages is the 11 Cost to Cure approach. Cost to Cure can be used to offset damages and is defined as the cost to restore an item of physical depreciation or functional depreciation to near new or new condition. However, it must make economic sense to apply the Cost to Cure as a measure of damage. An example of Cost to Cure would be reinstating access to a site that would otherwise be landlocked as a result of the taking. Copyright Gordon E. MacNair, AACI, P.App, SR/WA 49

Injurious Affection & Disturbance Damages Objectives: We will look at different types of Injurious affection and disturbance damages as parts of the heads of claim under the Expropriations Act. Copyright Gordon E. MacNair, AACI, P.App, SR/WA 50

*Landlocking A landlocked parcel is created when an Acquisition creates severance damages to a portion of the property and leaves it as a remnant or non-viable parcel. There was an interesting discussion on Landlocking in Parks v. Ministry of Transportation and seven other claims, 56 L.C.R. 166. The summary of Landlocking as described on pg. 229 is as follows: While the board is persuaded that the market for such landlocked parcels is somewhat restrictive and that the parties would be in different relative bargaining positions than with non-land-locked parcels, it does recognize that the various sales reviewed by the appraisers seem to indicate a clear tendency towards land assemblies in order to provide for comprehensive development plans. As such, the board finds that a 50% reduction in value seems most reasonable and sensible in terms of what a reasonably prudent purchaser might seek from a reasonably motivated vendor. *Value in Contribution & Landlocking, right of way magazine Jan/Feb 2004 Copyright Gordon E. MacNair, AACI, P.App, SR/WA 51

Proximity Damages This is an element of severance damage caused by proximity of the remainder to the improvement being constructed, such as a highway, hydro line, gas line, etc. Copyright Gordon E. MacNair, AACI, P.App, SR/WA 52

Causes for Proximity Damages Highways - loss of access, change in elevation, drainage, etc. Overhead Easements - visual impact, danger (real or implied) Underground Easements Balgerran Farms Ltd. v. Lacombe County (No. 14) 50/27 Copyright Gordon E. MacNair, AACI, P.App, SR/WA 53

Double Recovery In Horn v. Sunderland Corporation (1941) the decision was as follows: The value of the land determined on the basis of it s highest and best use, or the aggregate of the value of the land determined on the basis of its existing use plus disturbance damages. In other words, this case confirms that compensation must be awarded on a consistent basis. Therefore it is not appropriate to double dip by awarding compensation based on the Highest and Best Use, plus compensation for damages attributed to the lesser use. This concept has been entrenched in a number of Expropriation Acts such as British Columbia (31), Ontario (13), New Brunswick 38(1) and Nova Scotia 27(3). By way of an example, if the existing use was residential but the Highest and Best Use was commercial, it would not be consistent in arriving at a market value based on the commercial use and then adding compensation for injurious affection for the residential use. Copyright Gordon E. MacNair, AACI, P.App, SR/WA 54

Example Illustrating Horn Rule The subject property is 100 acres. Five acres is required for a road widening project. The property is zoned Agricultural and the current use is agricultural. The highest and best use for the subject is for future residential development within 5-7 years. Agricultural land in the area is worth $4,000/ac while development lands similar to the subject are selling for $25,000/ac. The cost to replace the agricultural fencing is estimated at $ 12,000. What is the due compensation payable to the owner? Pike v. Minister of Housing 20 L.C.R. 166 Take Copyright Gordon E. MacNair, AACI, P.App, SR/WA 55

Estimation of Damages Cost to Cure deficiency caused by construction Capitalized rent loss Judgment Beware of double compensation Percent of fee policy - administrative, not part of appraisal process Copyright Gordon E. MacNair, AACI, P.App, SR/WA 56

Calculation of Damages 1) Due Compensation Part Taken = Damages 2) Value of Remainder, Before (as part of the whole) less Value of the Remainder, After (as separate parcel) = Damages Copyright Gordon E. MacNair, AACI, P.App, SR/WA 57

Benefits (General & Special) Objectives: We will discuss the difference between general & special benefits. Benefits or Advantages are simply the converse of Injurious Affection. Copyright Gordon E. MacNair, AACI, P.App, SR/WA 58

Benefits General Benefits - accrue to the community at large Special Benefits - accrue directly and solely to the advantage of the property remaining after a partial taking F & F Realty Holdings Inc. v. Ont (MOT) 64/52 Kiear v. Manitoba (Dept of Highways & Trans) 66/117 Tanenbaum Estate v. Ontario (MTC) 54/161 Copyright Gordon E. MacNair, AACI, P.App, SR/WA 59

Benefits Typically, only special benefits can be offset against injurious affection or damages and not against the value of the part taken. As referenced earlier, the Courts in Canada will want to see a just result in that the owner is always compensated for at least the part taken. Set-off provision Copyright Gordon E. MacNair, AACI, P.App, SR/WA 60

Special Benefits Examples: Less near interchange increased road frontage increased visibility improved drainage better access Formula: Value of Remainder, After (Separate Parcel) Value of Remainder, Before (Part of Whole) = SPECIAL BENEFITS Copyright Gordon E. MacNair, AACI, P.App, SR/WA 61

Excellent Source of Information for Expropriation New Law of Expropriation by John Coates and Stephen Waque, published by Carswell Provides each section of the various Provinces with Expropriation Act along with explanations and examples of case law. Updated on a regular basis Copyright Gordon E. MacNair, AACI, P.App, SR/WA 62

Another Excellent Source of Information for Expropriation The Law of Expropriation and Compensation in Canada, 2 nd Edition (1992) by Dr. Eric C.E.Todd, published by Carswell Expropriation in Canada, A Practitioner s Guide, Kenneth J. Boyd, published by Canada Law Book Inc. (1988) Copyright Gordon E. MacNair, AACI, P.App, SR/WA 63

Conclusion Appraising real estate for expropriation purposes related to partial takings creates interesting challenges for the real estate appraiser. With this type of appraisal, it is important for the appraiser to understand the two partial taking valuation methods and how each is applied. As well, the appraiser must be familiar with the concepts of injurious affection, damages and benefits. And finally, it is important for the appraiser to obtain clear terms of reference from, and an agreed Scope of Work with the client. Legal counsel can be very useful in agreeing on terms of reference and Scope, as well as providing necessary instructions on an assignment. Research into case law, and familiarity with the applicable Expropriation Act is essential, but may go beyond the role of the appraiser. In this event legal counsel might be consulted to receive instructions as it applies to an expropriation. Copyright Gordon E. MacNair, AACI, P.App, SR/WA 64