Date: Jul 2, 2026

Sablan v. CUC (2026 MP 5): Inverse Condemnation Is Time-Barred Only After Survey-Ascertainable Accrual; Public Corporations Without Eminent-Domain Authority May Owe Just Compensation; Partial Takings Require Before-and-After Valuation

1. Introduction

Parties. Plaintiff-Appellant/Cross-Appellee Conrad M. Sablan (“Conrad”) sued the Commonwealth Utilities Corporation (“CUC”) and the Commonwealth of the Northern Mariana Islands (the “Commonwealth”) for inverse condemnation arising from the construction and ongoing operation of the “Maui IV Water Tank and Pump Station” (“Maui IV facility”) on the Sablan family land.

Background. CUC entered the land in 1991 and completed construction by March 31, 1992. The facility’s tank, pump house, and fenced footprint occupy about 1,029 square meters. Conrad observed the facility in 1992, but an “as-built” survey confirming the facility encroached onto the family tract was not produced until October 2013. Conrad filed suit in 2015.

Core issues. The Supreme Court addressed: (i) whether a statute of limitations applies to inverse condemnation and, if so, when the claim accrues; (ii) whether CUC can be liable absent statutory eminent-domain authority; (iii) whether trial management (bifurcation/reopening) was an abuse of discretion; (iv) whether a separate taking occurred as to Tract 22654-1 (alleged landlocking); (v) who owns the right to compensation after later conveyances; (vi) the proper prejudgment interest approach; and (vii) the correct valuation methodology for a partial physical taking.

2. Summary of the Opinion

The Court affirmed that (a) inverse condemnation claims are subject to a statute of limitations but Conrad’s claim was timely because it accrued in 2013; (b) CUC may be liable for inverse condemnation under Article XIII despite lacking independent eminent-domain authority; (c) additional proceedings after the liability phase were permissible case management; (d) no compensable taking occurred as to Tract 22654-1; and (e) the trial court did not clearly err in using the Moody’s Aaa Corporate Bond Index as the prejudgment interest rate under the prudent-investor rule.

The Court reversed that the compensation must be shared among the four 1991 co-owners, holding that Conrad alone is entitled to the compensation due to the parties’ conveyance intent and assignment of “claims.”

The Court vacated and remanded the compensation award because the trial court used the wrong valuation unit and method; on remand the court must apply the before-and-after method to the parent tract as it existed in 1991, not a later-created subdivided parcel.

3. Analysis

3.1. Precedents Cited

A. Statute of limitations and accrual for inverse condemnation

John R. Sand & Gravel Co. v. United States, 552 U.S. 130 (2008): Used to reject the trial court’s categorical view that constitutional takings claims are exempt from limitation periods; the Court emphasized that even takings claims can be time-limited and that limitations may serve structural purposes.
Estate of Rogolifoi v. Estate of Rogolifoi, 2024 MP 4: Reinforced that constitutional claims (there, due process) are not automatically immune from CNMI statutes of limitations (“no exceptions” language highlighted).
DW Aina Le'a Development, LLC v. State, 477 P.3d 836 (Haw. 2020): Persuasive authority for applying statutes of limitations to takings claims arising directly under a constitution.
Knick v. Twp. of Scott, 588 U.S. 180 (2019): Cited for the proposition that a takings claim may be brought immediately upon taking (timing principles relevant to the accrual discussion).
Estate of Muna v. Commonwealth, 2007 MP 16: Anchored valuation and interest principles to the “actual time of the physical taking” while recognizing timing considerations for payment/interest.
Boling v. United States, 220 F.3d 1365 (Fed. Cir. 2000) (quoting Hopland Band of Pomo Indians v. United States, 855 F.2d 1573 (Fed. Cir. 1988)): Provided the general accrual formulation (“all events which fix the government’s alleged liability… and the plaintiff was or should have been aware…”).
Katzin v. United States, 908 F.3d 1350 (Fed. Cir. 2018): Supplied the Court’s adopted two-part accrual test for physical occupations: (1) the occupation’s scope must be “fixed and ascertainable,” and (2) the plaintiff knew or reasonably should have known the occupation extended onto his property.
Cattellus Dev. Corp v. United States, 31 Fed. Cl. 399 (Fed. Cl. 1994): Recognized situations where invasions are obvious and permanent—used to evaluate (and distinguish) CUC’s argument that knowledge in 1992 was enough.
Aguon v. Marianas Pub. Land Corp., 2001 MP 4: Illustrated CNMI boundary uncertainty and how discrepancies can remain undiscovered for decades absent a survey—supporting the Court’s reluctance to impute earlier knowledge.
Commonwealth v. Lot No. 218-5 R/W, 2016 MP 17 and U.S. v. Dickenson, 331 U.S. 745 (1947): Used to emphasize fairness concerns where the government takes without notice/compensation, cautioning against forcing premature suits before owners can reasonably know what was taken.
Estate of Taisacan v. Hattori, 4 NMI 26 (1993): Cited in a footnote to explain historical land record imprecision (“more or less,” “subject to survey”) and the need for formal surveying to resolve boundaries.

B. Who can be liable for inverse condemnation (eminent-domain authority not required)

In re Estate of Roberto, 2004 MP 7 and Castro v. Castro, 2009 MP 8: Distinguished as addressing whether courts (the judiciary) “take” property when adjudicating private disputes; not controlling where an executive/public utility entity physically occupies land for public infrastructure.
First English Evangelical Lutheran Church v. County of Los Angeles, 482 U.S. 304 (1987) and Cedar Point Nursery v. Hassid, 594 U.S. 139 (2021): Cited for the central principle that the duty to pay just compensation flows from the taking/occupation itself, regardless of whether formal condemnation procedures were used.
Fountain v. Metro. Atlanta Rapid Transit Auth., 678 F.2d 1038 (11th Cir. 1982) and Tahoe-Sierra Pres. Council, Inc. v. Tahoe Regional Planning Agency, 911 F.2d 1331 (9th Cir. 1990): Persuasive authority that government cannot evade constitutional compensation duties by delegating operational/regulatory power to entities lacking eminent-domain authority.

C. Trial management: bifurcation/reopening

Ito v. Macro Energy, Inc., 4 NMI 46 (1993): Confirmed trial courts’ inherent docket and trial-timing discretion (abuse-of-discretion review).
Olopai v. Fitial, 3 NMI 101 (1992): Provided the framework for evaluating reopening of a case, focusing on prejudice.
United States v. McQuisten, 795 F.2d 858 (9th Cir. 1986) and Commonwealth v. Safka, 141 A.3d 1239 (Pa. 2016): Persuasive support that reopening (including sua sponte) is permissible absent prejudice.
Pritchett v. United States, 351 A.3d 14 (D.C. 2026): Cited for the abuse-of-discretion/prejudice framing (even though arising in the criminal context).

D. Access/landlocking and takings causation

Loretto, 458 U.S. 419 (1982) and Lucas v. S.C. Coastal Council, 505 U.S. 1003 (1992): Provided the core categories for per se physical takings and total regulatory deprivations.
Carillion Realty Corp. v. State, 158 Misc. 2d 810 (N.Y. Ct. Cl. 1993): Used to frame the concept that denial of access can be a taking, but also to highlight causation limits.
Esplanade Props., LLC v. City of Seattle, 307 F.3d 978 (9th Cir. 2002): Cited for the requirement of a causal connection between government action and the alleged deprivation.
Santos v. Santos, 2000 MP 9 and Castro v. Castro, 2009 MP 8: Supplied standards of review for mixed questions (clear error for facts, de novo for legal takings conclusion).

E. Ownership/assignment of the right to compensation

Palazzolo v. Rhode Island, 533 U.S. 606 (2001) and Danforth v. United States, 308 U.S. 271 (1939): Used to state the general rule that once a taking claim is known/vested, it is personal and does not automatically pass to later purchasers.
Brooks Inv. Co. v. City of Bloomington, 232 N.W.2d 911 (Minn. 1975): Quoted for the proposition that the vested right to compensation is “personal to the owner” and does not run with the land absent assignment.
Snow v. Town of Calumet Okla., 512 P.3d 369 (Okla. 2022) (citing Drabek v. City of Norman, 946 P.2d 658 (Okla. 1996)) and Argier v. Nevada Power Co., 952 P.2d 1390 (Nev. 1998): Recognized an exception where the prior owner assigns the compensation right.
Saipan Achugao Resort Members Ass'n v. Wan Jin Yoon, 2011 MP 12; Benavente v. Marianas Pub. Land Corp., 2000 MP 13; Northern Marianas Hous. Corp. v. BankPacific, Ltd., 2021 MP 7: Provided CNMI deed/contract interpretation principles (plain meaning first; if ambiguous, consider extrinsic evidence).
Sherman v. Sherman, 122 N.E. 439 (S.D. 1909) and the Restatement (First) of Property §§ 1, 5: Used to interpret the breadth of “claim,” “interest,” and “right,” supporting the conclusion that inverse condemnation rights can be conveyed/assigned.
Maslonka v. Pub. Util. Dist. No. 1 of Pend Orielle County, 533 P.3d 400 (Wash. 2023) and Cox Enters. v. Phillips Petroleum Co., 550 P.2d 1324 (Okla. 1976): Used to distinguish market-price-adjusted transfers from “hidden invasion” scenarios where the taking is not priced in and the claim effectively follows the land until it accrues/comes to light.

F. Prejudgment interest (prudent investor rule; expert gatekeeping)

Estate of Muna v. Commonwealth, 2007 MP 16 and Lot No. 353 New G, 2015 MP 6: Anchored prejudgment interest as part of constitutional just compensation and articulated the prudent-investor rule.
Commonwealth v. Lisua, 2024 MP 11 and Daubert v. Merrell Dow Pharm., Inc., 509 U.S. 579 (1993): Supported the trial court’s gatekeeping authority to reject unreliable expert methodology even if unrebutted.
Jackson v. United States, 155 Fed. Cl. 689 (2021); Tech. College of the Low Country v. United States, 147 Fed. Cl. 364 (2020); Sears v. United States, 132 Fed. Cl. 6 (2017): Persuasive authority approving the Moody’s Aaa rate as a prudent-investor benchmark.
Commonwealth v. Lot No. 353 New G, 2015 MP 6: Noted the Court’s willingness to consult federal takings jurisprudence for guidance on interest-rate issues.

G. Valuation methodology for partial physical takings

Knick v. Twp. of Scott, 588 U.S. 180 (2019) and Danforth v. United States, 308 U.S. 271 (1939): Reiterated that just compensation is anchored to the time of taking.
Est. of Muna, 2007 MP 16 and 2 CMC § 4712: Cited to reinforce that later subdivisions/conveyances do not reset the valuation baseline.
Olson v. United States, 292 U.S. 246 (1934): Cited for the core compensation principle of placing the owner in as good a pecuniary position as if the property had not been taken—supporting the before-and-after framework for partial takings.
Dow, 357 U.S. at 20-22 (as cited in the Opinion): Referenced for the proposition that the adopted appraisal must reliably measure the loss attributable to the government’s occupation.

3.2. Legal Reasoning

A. A new CNMI rule: inverse condemnation is subject to limitations, and accrual is “survey-ascertainable” under a two-part test

The Opinion’s most operationally significant holding is not merely that a limitations period applies; it is how the Court defines accrual for physical-occupation inverse condemnation in the CNMI.

The Court rejected the Superior Court’s view that limitations categorically do not apply because the Takings Clause lacks express limitations language. Relying on John R. Sand & Gravel Co. v. United States, Estate of Rogolifoi v. Estate of Rogolifoi, and DW Aina Le'a Development, LLC v. State, the Court held constitutional origins do not immunize claims from procedural deadlines.

On accrual, the Court adopted the federal framework from Boling v. United States/Hopland Band of Pomo Indians v. United States, refined for physical takings by Katzin v. United States: accrual requires (1) the occupation’s scope is fixed and ascertainable, and (2) the landowner knew or reasonably should have known the occupation extended onto his property.

Applying that test to CNMI realities, the Court emphasized that boundaries are often not visually knowable due to historic title determinations “without actual surveys,” citing Aguon v. Marianas Pub. Land Corp. and footnoted references including Estate of Taisacan v. Hattori. The Court also underscored fairness where the Commonwealth has a history of taking without compensation (Commonwealth v. Lot No. 218-5 R/W) and invoked U.S. v. Dickenson for the principle that just compensation is about fairness, not procedural technicalities.

Result: even though the physical taking occurred in 1991 and Conrad knew of the facility in 1992, the claim did not accrue until the 2013 survey revealed the encroachment. Thus the 2015 filing was timely, and the Court affirmed the timeliness outcome (while correcting the trial court’s categorical rationale).

B. A new CNMI rule: CUC can be constitutionally liable even without statutory eminent-domain authority

CUC argued only entities with eminent-domain power can owe just compensation, relying on In re Estate of Roberto and Castro v. Castro. The Court limited those cases to a narrow institutional principle: courts generally do not “take” property when adjudicating private disputes.

For affirmative public infrastructure occupations, the Court held the duty to pay derives from “the taking itself” (citing First English Evangelical Lutheran Church v. County of Los Angeles and Cedar Point Nursery v. Hassid). The Court relied on persuasive federal appellate authority—Fountain v. Metro. Atlanta Rapid Transit Auth. and Tahoe-Sierra Pres. Council, Inc. v. Tahoe Regional Planning Agency—to reject the idea that government can avoid constitutional obligations by routing projects through entities lacking eminent-domain authority.

This is a functional, anti-evasion holding: if a governmental entity physically occupies private land for a public purpose, it can be sued in inverse condemnation in the CNMI even if it cannot itself formally condemn.

C. Trial management: bifurcation and a prejudice-focused lens

The Court treated the post-liability proceedings as consistent with bifurcation rather than an improper “reopening.” Under Ito v. Macro Energy, Inc. and Olopai v. Fitial, the key inquiry is prejudice. Citing Commonwealth v. Safka and United States v. McQuisten, the Court held that even sua sponte supplementation is permissible absent surprise or denied opportunity to respond.

D. No taking of Tract 22654-1: causation and the timing of landlocking

Conrad’s theory was that the fence effectively landlocked Tract 22654-1. The Court accepted the doctrinal possibility that lost access can amount to a taking (citing Carillion Realty Corp. v. State), but held the facts did not establish causation as required by Esplanade Props., LLC v. City of Seattle.

The Court upheld the trial court’s factual finding (clear-error review per Santos v. Santos) that at the time of the fence’s construction, the triangular area remained reachable through the unified parent tract. The later landlocked condition resulted from the family’s own subdivision and failure to reserve internal easements—not government action—so there was no compensable taking of Tract 22654-1.

E. Compensation ownership: assignment via deed language and context

The Court accepted the general rule that once a takings claim vests, it is personal and does not automatically pass with later conveyances (Palazzolo v. Rhode Island; Danforth v. United States; Brooks Inv. Co. v. City of Bloomington). But it applied the recognized exception that an assignment can transfer the compensation right (Snow v. Town of Calumet Okla. (citing Drabek v. City of Norman); Argier v. Nevada Power Co.).

The interpretive work is deed-centered and CNMI-contract-law-grounded (Saipan Achugao Resort Members Ass'n v. Wan Jin Yoon; Benavente v. Marianas Pub. Land Corp.; Northern Marianas Hous. Corp. v. BankPacific, Ltd.). The Court found ambiguity created by the Confirmation Deed’s inclusion of “claims” alongside “all rights, title, and interests,” invoking the breadth of “claim” (Sherman v. Sherman) and “interest/right” concepts from the Restatement (First) of Property.

Crucially, the Court used surrounding context to resolve intent: the 2013 survey “dug up” a previously unknown encroachment, and the co-owners then proceeded to subdivide and convey within the same year. Analogizing to hidden-invasion cases like Cox Enters. v. Phillips Petroleum Co. and distinguishing market-adjusted transfers noted in Maslonka v. Pub. Util. Dist. No. 1 of Pend Orielle County, the Court held the co-owners intended to convey the inverse condemnation “interest” to Conrad. Thus, Conrad alone was entitled to the compensation award.

F. Prejudgment interest: objective prudent investor, not plaintiff-specific investing

The Court reaffirmed that prejudgment interest is constitutionally required as part of just compensation (Estate of Muna v. Commonwealth; Lot No. 353 New G) and is governed by the objective prudent-investor rule. It rejected Conrad’s argument that his unrebutted expert rate had to be accepted, stressing the court’s gatekeeping role under Commonwealth v. Lisua and Daubert v. Merrell Dow Pharm., Inc..

Because Conrad’s expert used a portfolio tailored to Conrad’s personal characteristics (age, risk tolerance, horizon), the trial court could deem it inconsistent with the objective prudent-investor benchmark. The Court then approved use of the Moody’s Aaa Corporate Bond Index as a conservative, market-based proxy, supported by federal takings cases (Jackson v. United States; Tech. College of the Low Country v. United States; Sears v. United States).

G. Valuation methodology: partial takings must be valued on the parent tract at the time of taking (before-and-after)

The Court’s second major remedial holding is methodological: because the Maui IV facility occupied only part of a larger tract in 1991, compensation must be measured using the before-and-after method on the parent tract as it existed at the time of taking, not by valuing a later-created subdivided parcel as though wholly taken.

Relying on the date-of-taking principles in Knick v. Twp. of Scott and Danforth v. United States, and reinforcing that later subdivisions do not alter the valuation baseline (Est. of Muna; 2 CMC § 4712), the Court held the unit of analysis was the 1991 undivided Tract 22654 (after right-of-way deductions). For partial takings, the Court invoked Olson v. United States to support the before-and-after measure: the difference between the tract’s fair market value immediately before the taking and the remainder’s fair market value immediately after, accounting for the permanent occupation footprint.

Because Conrad’s appraisal valued Tract 22654-R2—created in 2014—and assumed an entire parcel taken as vacant land, it did not reliably measure the 1991 partial taking. The Court therefore vacated and remanded with specific instructions: find the parent tract’s 1991 value, use March 31, 1991 as the valuation date, and apply before-and-after; parties may submit updated appraisals consistent with the Opinion.

3.3. Impact

Accrual and CNMI land-record realities. By adopting Katzin v. United States and emphasizing boundary-survey uncertainty, the Court effectively recognizes that in CNMI practice, accrual may hinge on when an encroachment becomes reasonably knowable—often when a survey or comparable notice fixes the encroachment relative to boundaries. This will materially shape litigation timing and defenses in infrastructure-adjacent land disputes.
Expanded accountability for public instrumentalities. The holding that CUC can be liable despite lacking eminent-domain authority reduces incentives to “structurally evade” compensation obligations through delegation. Public corporations and similar entities should anticipate direct inverse-condemnation exposure when they physically occupy private land.
Assignment of takings claims in conveyancing. The deed-analysis portion signals that CNMI courts will examine deed language (“claims,” “rights,” “interests”) and context to determine whether inverse condemnation rights were assigned—important for estate planning, family partitions, and subdivision/conveyance transactions following a newly discovered encroachment.
Valuation discipline. The remand instructions tighten appraisal practice: partial physical takings should be valued with before-and-after on the parent tract as of the taking date, not via post-taking parcelization that can inflate or distort the compensation baseline.
Prejudgment interest benchmarks. The approval of the Moody’s Aaa Corporate Bond Index, alongside prudent-investor objectivity and gatekeeping, provides a practical template for future CNMI takings cases where parties offer aggressive or highly individualized return models.

4. Complex Concepts Simplified

Inverse condemnation: A lawsuit by a property owner claiming the government (or a governmental entity) effectively took property for public use without formally condemning it and without paying just compensation.
Physical taking vs. regulatory taking: A physical taking involves occupation or appropriation of land (e.g., building a tank and fencing it). A regulatory taking involves regulations that so restrict use that they are equivalent to a taking (discussed by analogy through cases like Palazzolo v. Rhode Island).
Statute of limitations vs. “accrual”: The limitations period is the filing deadline; “accrual” is when the clock starts. Here, accrual required both a fixed occupation and reasonable knowledge that the occupation encroached onto the owner’s parcel—often not possible in the CNMI without a survey.
Before-and-after method: A valuation approach for partial takings: compare the fair market value of the whole property immediately before the taking with the fair market value of what remains immediately after. The difference is compensation (plus interest), reflecting the real economic loss caused by the partial occupation.
Sales-comparison method (and why it failed here): Sales comparison values a parcel by comparing it to similar sold parcels. The Court held it was misapplied because the appraisal treated a post-2014 subdivided lot as if it existed and was wholly taken in 1991, instead of valuing the 1991 parent tract and the partial occupation.
Prudent investor rule (prejudgment interest): Interest is designed to make the owner whole for the delay in payment—measured by what a reasonable, careful investor could have earned while preserving principal, not a plaintiff’s personal risk preferences.
Assignment of a takings claim: Even if the right to compensation initially belongs to the owner at accrual, it can be transferred if the conveyance shows an intent to assign that claim (here, the deed’s “claims” language plus context).

5. Conclusion

Sablan v. CUC establishes and clarifies several consequential CNMI takings rules: (1) inverse condemnation claims are subject to statutes of limitations; (2) for physical occupations, accrual occurs when the occupation is fixed and the owner knew or reasonably should have known it encroached—often tied to survey-ascertainable boundary knowledge in CNMI conditions; (3) a public corporation like CUC may owe just compensation even without statutory eminent-domain authority; (4) deed language and context can assign the right to compensation to a later owner; (5) prejudgment interest is governed by an objective prudent-investor approach and may be benchmarked to Moody’s Aaa; and (6) partial physical takings must be valued by the before-and-after method on the parent tract at the time of taking, not by valuing later-created subdivided parcels.