## Facts

- Mariner’s Cove was a 58-unit townhome community governed by recorded declarations creating servitudes and covenants running with the land.
- Mariner’s Cove Townhomes Association, Inc. (MCTA) provided services and funded operations through periodic assessments charged to each unit owner on a 1/58 proportional basis.
- The United States undertook a post-Hurricane Katrina flood-control project and condemned 14 of the 58 townhome properties in several related eminent-domain actions.
- The United States named MCTA as an interested party because of its recorded covenants and assessment structure.
- MCTA asserted no ownership interest in the condemned land or improvements.
- MCTA sought just compensation for the alleged loss of its right to collect assessments on the 14 condemned units, claiming the condemnation reduced its assessment base and shifted greater costs to remaining owners.

## Issues

1. Whether an association’s asserted right to collect future assessments on condemned units constitutes a compensable property interest requiring just compensation under the Fifth Amendment.
2. Whether the reduced assessment base and resulting financial impacts on the association are noncompensable consequential damages from the taking of other parties’ property.

## Decision

- The Fifth Circuit affirmed the district court’s Rule 12(c) judgment on the pleadings for the United States.
- The court held that MCTA’s loss of assessment revenue tied to the condemned units was not a compensable property interest under the Takings Clause.
- MCTA was not entitled to any portion of the condemnation awards based solely on the diminution of its assessment base.

## Legal Principles

- The Takings Clause requires just compensation only for the taking of legally cognizable property interests, not for all economic injuries caused by a condemnation.
- Indirect or consequential financial losses suffered by third parties from the government’s taking of others’ property are generally not compensable.
- A claimed right to collect future assessments, when not coupled to a recognized property interest in the condemned parcels (such as an ownership interest, lien, or other secured interest), is treated as an expected revenue stream rather than a compensable interest in the property taken.

## Conclusion

Because MCTA claimed only a reduced stream of future assessment payments resulting from the condemnation of individual units, and not a recognized property interest in the condemned parcels, its asserted loss was a noncompensable consequential economic injury for which the Fifth Amendment required no just compensation.


United States v. 0.073 Acres of Land, 705 F.3d 540 (5th Cir. 2013)