4.1.3. Federal Law Controls.Just compensation is determined in accordance with federal rather than state law.177 Both appraisers and attorneys must correctly apply federal law as it affects the appraisal process in the estimations of market value, recognizing that federal and state laws differ in important respects. Appraisals for federal acquisitions must follow the appropriate legal standards.178 Most appraisals for federal acquisitions involve straightforward application of established legal standards to the facts.179 But some valuation problems require nuanced legal instructions to address complicated or undecided questions of law.180 If the correct legal standard is unclear, agencies may find it prudent to procure a dual-premise appraisal.181 

Federal courts have jurisdiction to determine title (ownership) questions in federal condemnation proceedings, but sometimes refer to state law in resolving the nature of property rights acquired.182 The United States Supreme Court has stated that “[t]hough the meaning of ‘property’…in the Fifth Amendment is a federal question, it will normally obtain its content by reference to local law.”183 It is also established that the United States can acquire any property interest it deems necessary, whether or not the interest is recognized under state laws.184 Federal law is “wholly applicable” to condemnations by federal agencies,185 controlling procedural as well as substantive matters under Rule 71.1 of the Federal Rules of Civil Procedure.186