- in United States
Over the last several years, we've been following an eminent domain case playing out in Mendocino County related to the Skunk Train. In 2023, the court concluded that the Skunk Train operator, Mendocino Railway, did not have the right to take property because it was not proposing to put the property to a public use. In a recent unpublished opinion, the Court of Appeal revisited this conclusion, and addressed whether a railroad corporation qualified as a public utility with the authority to exercise eminent domain, and what evidentiary showing is required to establish public use and compliance with California's "greatest public good and least private injury" standard.
Background
Mendocino Railway v. Meyer arose from a condemnation action in which Mendocino Railway sought to acquire private property to expand and support its rail operations in Mendocino County. The railway asserted that it was a common-carrier public utility authorized to provide passenger and freight rail service and therefore possessed the power of eminent domain under California law.
The property owners challenged the taking, arguing that Mendocino Railway was not a true public utility and that the proposed project did not serve a valid public use. They further contended that the railway failed to demonstrate that the taking was necessary or that it was planned in a manner that would achieve the greatest public good while causing the least private injury, as required by Code of Civil Procedure section 1240.030.
The trial court agreed with the property owners and denied the railway's right to condemn the property. Mendocino Railway appealed, contending that the trial court applied an overly restrictive standard and improperly rejected evidence establishing its public utility status, public use, and compliance with statutory necessity requirements.
Appellate Court's Ruling
The Court of Appeal reversed, concluding that Mendocino Railway had established its authority to exercise eminent domain and that the evidence was sufficient to allow the condemnation action to proceed. The benefit of this opinion is that it walks through the power of eminent domain for a public utility, what qualifies as a public use, and the requirements for showing greatest public good and least private injury, as discussed below.
- Public Utility Status and Eminent Domain
California law authorizes railroad corporations that operate as common carriers to exercise the power of eminent domain for purposes necessary to construct, maintain, and operate railroad facilities. In this case, the court held that Mendocino Railway qualifies as a public utility and therefore has statutory authority to exercise eminent domain. Evidence showing that the railway was authorized to operate as a common carrier — including prior administrative determinations — was sufficient to establish condemnation authority, even though the extent of current operations was disputed.
- Public Use
The court reaffirmed that acquiring property for railroad facilities serving passenger or freight rail transportation constitutes a valid public use. However, the court emphasized that the public use analysis requires more than a general assertion of public benefit. While future or planned service may support a public use finding, the proposed use must be tied to legitimate transportation purposes rather than speculative or predominantly private commercial activities. The court made clear that condemnation authority does not extend to projects where the asserted public benefit is incidental or unsupported by the record. Here, the Court found that even though 90% of the Skunk Train's revenue was from private excursions (i.e., a private use), it is the character of the use, not its extent, which determines whether it is public.
- Greatest Public Good and Least Private Injury
To satisfy Code of Civil Procedure section 1240.030, a condemnor must show that the project is planned or located to achieve the greatest public good while minimizing private injury. Although the court acknowledged weaknesses in the project record, it concluded that the evidence was sufficient to allow the condemnation action to proceed, including that the railway undertook an extensive site search, investigation and analysis, and considered multiple potential sites. The Court explained that a proper location is based on two factors: public good and private injury. Accordingly, the condemnor's choice is correct or proper unless another site would involve an equal or greater public good and a lesser private injury.A lesser public good can never be counter-balanced by a lesser private injury to equal a more proper location. Nor can equal public good and equal private injury combine to make the condemnor's choice an improper location. Having selected the Meyer site and given the analysis undertaken, the railway established that the property was necessary for the project and satisfied the greatest public good and least private injury.
Conclusion
Mendocino Railway v. Meyer reinforces the principle that public utilities may exercise eminent domain for legitimate transportation purposes, while underscoring the importance of credible planning and evidentiary support. The decision provides useful guidance for both condemning agencies and property owners navigating the boundaries of public use and necessity under California law.
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