Electro Sales and Services, Inc. and Salim Merchant v. the City of Terrell Hills

ACCEPTED
04-17-00077-CV
FOURTH COURT OF APPEALS
SAN ANTONIO, TEXAS
9/25/2017 9:11 PM
FILED IN
4th COURT OF APPEALS
In the Fourth Court of Appeals SAN ANTONIO, TEXAS
Sitting at San Antonio, Texas 09/25/2017 9:11:33 PM
KEITH E. HOTTLE
CLERK
Electro Sales and Service, Inc. & Salim Merchant,
Appellants
v.
City of Terrell Hills,
Appellee
Appeal from the 57th District Court, Bexar County, Texas
Cause No. 2016-CI-19821; Hon. Michael Mery, Judge Presiding
Brief of Appellee City of Terrell Hills
Barbara L. Quirk Adolfo Ruiz
State Bar No. 16436750 State Bar No. 17385600
MCKAMIE KRUEGER, LLP MCKAMIE KRUEGER, LLP
941 Proton Road 941 Proton Road
San Antonio, Texas 78258 San Antonio, Texas 78258
210.546.2122 Telephone 210.546.2122 Telephone
210.546.2130 Facsimile 210.546.2130 Facsimile
barbara@mckamiekrueger.com adolfo@mckamiekrueger.com
Attorneys for Appellee
ORAL ARGUMENTS NOT REQUESTED
STATEMENT REGARDING ORAL ARGUMENT
1. Oral argument is not requested, because Defendant/Appellee asserts
the facts and legal arguments are adequately presented in the briefs and record.
This appeal is made from the trial court’s granting of a summary judgment motion.
The merit of the arguments of the parties may be readily determined from the
briefs of the parties without need for oral argument.
2. This appeal involves questions of law; for each of
Plaintiffs/Appellants causes of action, inverse condemnation and declaratory
judgment, whether Defendant/Appellee negates at least one element of the cause of
action, or otherwise demonstrates there is no genuine issue of fact and
Defendant/Appellee is entitled to judgment as a matter of law, or alternatively,
pleads and conclusively establishes each element of at least one of its affirmative
defenses, governmental or sovereign immunity, lack of standing, or lack of
ripeness/failure to exhaust administrative remedies; or, alternatively, whether
Plaintiffs have provided summary judgment evidence to create a genuine issue of
material fact regarding each of the elements of Plaintiffs’ causes of action against
Defendant/Appellee, the City of Terrell Hills, for inverse condemnation/regulatory
taking and for declaratory judgment in their response to Defendant’s traditional
and no evidence summary judgment motion; and, alternatively, whether Plaintiffs’
response raised a genuine issue of material fact sufficient to defeat one or more of
ii
the elements of each of the defenses established by Defendant in its summary
judgment motion, governmental/sovereign immunity, lack of standing, lack of
ripeness and exhaustion of administrative remedies. Because this matter was
decided on the basis of the summary judgment evidence, the pleadings of the
parties, Defendant’s Motion for Summary Judgment and the subsequent Response
and Reply, the relevant factual and legal allegations are all contained in the record
on appeal and the briefs of the parties before this Court.
3. The movant can move for summary judgment even with no evidence
on the grounds that there is no evidence of one or more essential elements of a
claim or defense on which the non-movant has the burden of proof. The burden
then shifts to the non-movant to present evidence raising an issue of material fact.
Oral argument would not assist the Court further in this matter.
iii
TABLE OF CONTENTS
STATEMENT REGARDING ORAL ARGUMENT .............................................. ii
TABLE OF CONTENTS ......................................................................................... iv
INDEX OF AUTHORITIES.................................................................................... vi
STATEMENT OF FACTS ........................................................................................1
SUMMARY OF ARGUMENT .................................................................................5
A. Summary Judgment Proper Because Plaintiffs Waived No Evidence Issues ...6
B. Summary Judgment Proper on Jurisdictional Grounds .....................................7
C. Appellee’s Objections to Appellant’s Issues 2, 3, and 4 Which Were not
Argued in Plaintiffs’ Response to Defendant’s Motion for Summary Judgment ..9
D. Summary Judgment Proper; No Fact Issue on Elements of Plaintiffs’ Claims
and Defendant Entitled to Judgment as a Matter of Law .....................................11
OBJECTION TO CERTAIN OF APPELLANTS’ FACTUAL ALLEGATIONS .19
ARGUMENT ...........................................................................................................22
I. The Trial Court’s Summary Judgment for the City should be upheld because
Plaintiffs/Appellants have not raised any issue on the City’s No-Evidence
grounds, and, alternatively, the Trial Court’s judgment should be upheld based
on defensive grounds of immunity, lack of standing, and lack of
ripeness/exhaustion of remedies. (Responds to Appellants’ Brief at pg. 6; ref.
Issue 1) ..................................................................................................................22
I-1. Appellants have failed to raise an issue on appeal regarding the no evidence
portion of Defendant’s Motion for Summary Judgment and on the declaratory
judgment grounds and summary judgment should be upheld on these grounds. .24
A. Standard and scope of review for subject matter jurisdiction (Responds to
Appellants’ Brief at pg. 6) .................................................................................29
B. Plaintiffs Failed to Raise Valid Regulatory Takings Claim; City Entitled to
Sovereign Immunity (Responds to Appellants’ Brief at pg. 7) .........................31
C. Plaintiffs have not provided evidence to create a fact issue to demonstrate
they have standing to sue. (Responds to Appellants, Brief at pg. 9). ................36
D. Plaintiffs’ claims are not ripe because Plaintiffs failed to establish futility
of other options available (Responds to Appellants’ Brief at pg.10) ................38
iv
II. No inverse condemnation/taking can be demonstrated because there is no
intentional taking and no property right in having one’s zoning changed to
commercial or in reinstating a non-conforming use abandoned by a predecessor
in interest (Responds to Appellants’ Brief at pg. 11; ref. issues 2, 3 and 4). .......42
A. Traditional summary judgment standards of review (Responds to
Appellants’ Brief at pg. 11) ...............................................................................42
B. Appellee Objects to Appellants’ “Issue 2” (Balance Between Public and
Private Interests) Raised for First Time on Appeal and Not a Relevant Issue
(Responds to Appellants’ Brief at pg. 11 and pg. 21; ref. Issue 2) ...................44
C. Subject to the foregoing objection, Defendant City not required to prove
that public interest in its zoning restrictions outweighs the private burden on
Plaintiffs, property, Plaintiffs failed to present any evidence on this issue or
raise question of fact (Responds to Appellants’ Brief at pg. 13 ref. Issue 2)....44
D. Appellee Objects to Appellants’ “Issue 4” (Stripped Economic Viability)
Raised for the First Time on Appeal. Subject thereto, Plaintiffs failed to
provide evidence or raise an issue of fact to support their argument that the
City’s zoning deprived Plaintiffs of the economically viable use of their
property or unreasonably interfered with their use of the property (Responds to
Appellants’ Brief at pg. 16; ref. Issue 4) ...........................................................52
III. Defendant objects to Appellants issue on the character of governmental
action which was not raised by Plaintiffs in their Response to Defendant’s
summary judgment motion. Subject thereto, the summary judgment evidence
shows no zoning intransigence and there is no regulatory taking as a matter of
law (Responds to Appellants’ Brief at pg. 20; ref. Issue 4) .................................61
IV. Appellee has objected above to Appellants’ “Issue 2” (Balance Between
Public and Private Interests) Raised for First Time on Appeal and Not a Relevant
Issue (Responds to Appellants’ Brief at pg. 21; ref. Issue 2) ...............................62
V. CONCLUSION ..............................................................................................63
PRAYER ..................................................................................................................64
CERTIFICATE OF SERVICE ................................................................................66
CERTIFICATE OF COMPLIANCE .......................................................................67
APPENDIX ..............................................................................................................68
v
INDEX OF AUTHORITIES
Cases
Abbott v. City of Princeton, 721 S.W.2d 872, 875 (Tex. App.--Dallas 1986, writ
ref'd n.r.e.) .............................................................................................................37
Ager v. Wichita Gen. Hosp., 977 S.W.2d 658, 660 (Tex. App.--Fort Worth 1998,
no pet.) ..................................................................................................................33
Agins v. City of Tiburon, 447 U.S. 255, 260 (1980) ................................................51
Allen v. City of Texas City, 775 S.W.2d 863 (Tex. App.--Houston [1st Dist.] 1989,
writ denied) ...........................................................................................................26
Azadpour v. City of Grapevine, No. 02-13-00323- CV, 2014 WL 2566024, at *4
(Tex. App.––Fort Worth June 5, 2014, pet. denied) (mem. op.) ..........................48
Bland ISD v. Blue, 34 S.W.3d 547, 44 Tex. Sup. Ct. J. 125 (Tex. 2000)................30
Browning-Ferris, Inc. v. Brazoria County, 742 S.W.2d 43, 49 (Tex. App.--Austin
1987, no writ) ........................................................................................................41
Carr v. Brasher, 776 S.W.2d 567 (Tex. 1989) ..........................................................6
City of Abilene v. Burk Royalty Co., 470 S.W.2d 643, 14 Tex. Sup. Ct. J. 489 (Tex.
1971) .....................................................................................................................26
City of Dallas v. Blanton, 200 S.W.3d 266 (Tex. App.--Dallas 2006, no pet.) 26, 31
vi
City of Dallas v. VSC, LLC, 347 S.W.3d at 236 .....................................................35
City of Fort Worth, 388 S.W.2d 400, 402 (Tex. 1964 ...................................... 51, 60
City of Hedwig Village Planning & Zoning Comm'n v. Howeth Invs., Inc., 73
S.W.3d 389 (Tex. App.--Houston [1st Dist.] 2002, no pet.) ................................30
City of Houston v. Clear Creek Basin Auth., 589 S.W.2nd 671, 678 (Tex. 1979) ...43
City of Pharr v. Pena, 853 S.W.2d 56, 63 (Tex. App.—Corpus Christi 1993, writ
denied)...................................................................................................................60
City of Pharr v. Tippitt, 616 S.W.2d 173, 176 (Tex. 1981).............................. 49, 52
City of San Antonio v. El Dorado Amusement Co., Inc., 195 S.W.3d 238 (Tex.
App.--San Antonio 2006, pet. denied) ..................................................................32
City of University Park v. Benners, 485 S.W.2d 773, 778 (Tex. 1972) ........... 48, 52
City of University Park v. Benners, 485 S.W.2d 773, 779 (Tex. 1972) ..................14
Denman v. Citgo Pipeline Co., 123 S.W.3d 728 (Tex. App. Texarkana 2003) ......37
Dillard v. Austin Indep. Sch. Dist., 806 S.W.2d 589 (Tex. App.--Austin 1991, writ
denied)...................................................................................................................31
EPGT Tex. Pipeline, L.P. v. Harris County Flood Control Dist., 176 S.W.3d 330
(Tex. App.—Houston, 2004, pet’n dismissed) ........................................ 30, 33, 43
vii
Flameout Design & Fabrication, Inc. v. Pennzoil Caspian Corp., 994 S.W.2d 830
(Tex. App.--Houston [1st Dist.] 1999, no pet.) ....................................................25
FM Props. Operating Co. v. City of Austin, 22 S.W.3d 868 (Tex. 2000) ...............22
Foster v. Denton Indep. Sch. Dist., 73 S.W.3d 454 (Tex. App. – Fort Worth, 2002)
...........................................................................................................................6, 25
Gen'l Servs. Comm'n v. Little-Tex Insulation Co., 39 S.W.3d 591 (Tex. 2001) .....25
Hamilton Bank Williamson County Reg’l Planning Comm’n v. Hamilton Bank, 473
U.S. 172, 186 (1985) .............................................................................................40
Hearts Bluff Game Ranch, Inc. v. State, 381 S.W.3d 468, 476 (Tex. 2012) ...........36
Jackson v. Fiesta Mart, Inc., 979 S.W.2d 68 (Tex. App.--Austin 1998, no pet.) ...25
King Ranch Inc. v. Chapman, 118 S.W.3d 742 (Tex. 2003) ...................................24
Lay v. Aetna Ins. Co., 599 S.W.2d 684, 686 (Tex. Civ. App.--Austin 1980, writ
ref'd n.r.e.) .............................................................................................................37
Lingle v. Chevron USA, Inc., 544 U.S. 528 (2005) ............ 11, 13, 16, 45, 49, 51, 57
Mayhew v. Town of Sunnyvale, 964 S.W.2d 922 (Tex. 1998).. 26, 46, 47, 49, 55, 60
McMahon Contracting, L.P. v. City of Carrollton, 277 S.W.3d 458 (Tex. App.-
Dallas 2009, pet. denied) ......................................................................................31
viii
Medrano v. City of Pearsall, 989 S.W.2d 141, 144 (Tex. App.--San Antonio 1999,
no pet.) ..................................................................................................................33
Moore v. K Mart Corp., 981 S.W.2d 266 (Tex. App.--San Antonio 1998, pet.
denied)...................................................................................................................25
Mr. W. Fireworks, Inc. v. Comal Cty., No. 03-06-00638-CV, 2010 WL 1253931, at
*8 (Tex. App.––Austin Mar. 31, 2010, no pet.) (mem. op.) ................................48
Public Util. Comm’n v. Houston Lighting & Power Co., 748 S.W.2d 439 (Tex.
1987) .....................................................................................................................41
Science Spectrum, Inc. v. Martinez, 941 S.W.2d 910, 40 Tex. Sup. Ct. J. 438 (Tex.
1997) .............................................................................................................. 30, 43
Sheffield Dev. Co. v. City of Glenn Heights, 140 S.W.3d 660 (Tex. 2002)7, 8, 45,
46, 47
State Bar of Texas v. Gomez, 891 S.W.2d 243, 245 (Tex. 1994) ............................41
State v. Terrell, 588 S.W.2d 784, 22 Tex. Sup. Ct. J. 543 (Tex. 1979)...................31
Taub v. City of Deer Park, 882 S.W.2d 824, 826 (Tex. 1994) ................................46
Tex. Ass'n of Bus. v. Tex. Air Control Bd., 852 S.W.2d 440, 36 Tex. Sup. Ct. J. 607
(Tex. 1993)..................................................................................................... 31, 41
ix
Tex. Dep't of Parks & Wildlife v. Miranda, 133 S.W.3d 217, 47 Tex. Sup. Ct. J.
386 (Tex. 2004)........................................................................................ 30, 31, 32
Tex. Dep't of Transp. v. A.P.I. Pipe & Supply, LLC, 397 S.W.3d 162 (Tex. 2013) 32
Texas Ass’n of Business v. Texas Air Control Bd., 852 S.W.2d 440, 1993 Tex.
LEXIS 22, 36 Tex. Sup. J. 607 (Tex. 1993) .........................................................36
Wasson Interests, Ltd. v. City of Jacksonville, 489 S.W.3d 427 (Tex. 2016) .........22
Statutes
Tex. Civ. Prac. & Rem. Code Ann. §37.001 (West 2017) ........................................4
Tex. Const. Art. I, §17 .............................................................................. 4, 8, 25, 26
TEX. LOC. GOV’T CODE § 211.010(b)................................................................39
Tex. Loc. Gov’t Code Ann §211.009(a) ..................................................................38
Tex. Loc. Gov’t Code Ann §211.010 ......................................................................38
Tex. Loc. Gov’t Code Ann §211.011 ......................................................................38
TEX. R. CIV. P. 166a(i) ................................................................................... 24, 25
Other Authorities
City of Terrell Hills Code of Ordinances Ch14, Sec. XV .......................................39
City of Terrell Hills Ordinance 1347 .........................................................................4
x
City of Terrell Hills Ordinance 1349 .........................................................................4
City of Terrell Hills Ordinance 1386 .........................................................................4
xi
No. 04-17-00077-CV
In the Fourth Court of Appeals
Sitting at San Antonio, Texas
Electro Sales and Service, Inc. & Salim Merchant,
Appellants
v.
City of Terrell Hills,
Appellee
Appeal from the 57th District Court, Bexar County, Texas
Cause No. 2016-CI-19821; Hon. Michael Mery, presiding
Brief of Appellee City of Terrell Hills
TO THE HONORABLE FOURTH COURT OF APPEALS:
NOW COMES Appellee, the CITY OF TERRELL HILLS (sometimes
referred to herein as “the City”), and submits this Brief of Appellee in accordance
with the Texas Rules of Appellate Procedure (“TRAP”).
STATEMENT OF FACTS
4. This case began with the purchase by Electro Sales and Service
through its President, Plaintiff/Appellant, Salim Merchant (“Merchant”), from
Billy and Gin Wei Eng (“the Engs”) of a property located within the City of Terrell
Hills (“the Property”). See Appellant’s Brief at pg. 1. The Warranty Deed and
1
purchase contract show that the purchaser of the property was a Texas corporation,
Plaintiff/Appellant Electro Sales and Service, Inc. Merchant signed as the
President of the Corporation. CR 564 to CR 580. Merchant has failed to provide
evidence of any alleged individual ownership interest in the Property.
5. The Property has been zoned semi-commercial since the mid-1960s.
See CR 613 and 696 (excerpts of the deposition of the previous property owner,
Billy Eng, who states the Property was always semi-commercial; all the way back
in the 60’s). In the mid-1960s the Property had been re-zoned from commercial to
semi-commercial by Defendant, the City of Terrell Hills (“the City”), pursuant to
the City’s plans for the area. See Appellants’ Brief, pg. 1, par. 1.
6. At the time of the zoning decision in the 1960’s certain commercial
business uses (such as the laundromat use in the center of the Property) were
allowed to continue as “non-conforming uses” for so long as they did not cease to
operate the use for six months or more.
7. Mr. Eng testified that at the time the Property was sold to Electro
Sales and Service the middle space already had lost it grandfathered status for
being able to be operated as a commercial laundromat and that he let Merchant
know. CR 614 - 615. The Engs allowed the previous tenant of the space in question
to vacate the premises because his business as a laundromat or dry cleaners was
failing. CR 696. Eng intentionally allowed the non-conforming commercial
2
laundromat use to lapse because he did not intend to do a laundromat anymore; he
believed he could lease it as office space (following the existing semi-commercial
zoning). CR 615, Excerpts of Billy Eng’s Deposition, pages 94:21 to 95:10. The
non-conforming commercial uses in the outer parcels, including a bar and a
convenience store, had not been abandoned since the time Mr. Eng’s father
acquired the Property in the 1960’s and continued to operate after Merchant’s
purchase of the Property. CR 611, Excerpts of Billy Eng’s Deposition, pages 18:4-
25; 19:1-21; 20:4-8.
8. Minutes of the City Council of the City of Terrell Hills of August 8,
2011 show that the City Council discussed a request by Merchant to re-zone the
Property to “Commercial,” but City Council denied the request, discussing the fact
that this area is a transition zone and there are immediate neighbors who would be
directly affected. CR 622.
9. The minutes of the City Council of the City of Terrell Hills from
October 8, 2012 show that the matter put before City Council from Merchant was a
request for rezoning of the Property from “Semi-Commercial” to “Commercial”.
CR 628. These were not requests to reinstate the previously abandoned non-
conforming laundromat use. Merchant told City Council he wished to lease to a
tenant who planned to open a barber shop. CR 628. The Planning and Zoning
Commission recommended City Council deny the re-zoning request. CR 628. The
3
re-zoning request was denied, but City Council decided a meeting should be held
by the Planning and Zoning Commission to discuss amending the zoning ordinance
to allow for the issuance of Special Use Permits which would allow uses such as a
barber shop, but not the entire range of commercial uses. CR 628.
10. Since that time, the City Council has granted Merchant’s requests for
special use permits for use of the Property under City of Terrell Hills Ordinance
1347, passed on December 10, 2012, providing for a Special Use Permit process;
City of Terrell Hills Ordinance 1349, passed May 13, 2013, allowing a hair and
nail salon use; and City of Terrell Hills Ordinance 1386, passed April 13, 2015,
allowing a hair and nail salon. See CR 632 to 639. 1
11. Plaintiffs’ filed causes of action against the City for a regulatory
taking 2 under Section 17 of Article I of the Constitution of the State of Texas and a
declaratory judgment under Chapter 37 of the Texas Civil Practices and Remedies
Code related to interpretation of the City’s Zoning Ordinance. CR 5 – 6; Tex. Civ.
Prac. & Rem. Code Ann. §37.001, et seq. Tex. Const. Art. I, §17.
1
The City requests that the Court take judicial notice of all of the provisions of the City’s Zoning
Code relied upon herein.
2
In the fact section of the Petition on page 4 Plaintiff states the interpretation of the ordinance is
regulatory condemnation, and the enforcement of the ordinance is regulatory taking. However,
the causes of action portion of the pleading only asserts regulatory taking. CR 4 – 5. The Petition
also contains a section d) which has a heading applicable to “all defendants”, but this section
contains no claims against the City. CR 8.
4
12. For further factual averments, Appellee incorporates herein as if set
forth in full the summary judgment evidence attached to Defendant’s Motion for
Summary Judgment and Reply in Support of its Motion for Summary Judgment,
Exhibits 1 through 8 at CR 610 to 651 and CR 696.
SUMMARY OF ARGUMENT
13. This lawsuit arose from Plaintiffs’ dispute with the Engs, the previous
owners of the Property, over Merchant’s own failure to investigate the long-
standing “Semi-Commercial” zoning classification of the Property before
purchasing the Property. Merchant has admitted his misconception regarding the
previous intentional abandonment and termination by the Engs, of a non-
conforming commercial laundromat use in the center suites of the Property.
Merchant attempted to compensate for his error by trying to force the City to
change the zoning of the Property from its long-standing “Semi-Commercial”
zoning to “Commercial” zoning. Although the City denied Plaintiffs’ re-zoning
request, the City has granted Plaintiffs Special Use Permits for their requested uses
on more than one occasion.
14. Appellants’ suit against the City is one for inverse condemnation and
declaratory judgment, claiming an intentional regulatory taking of their property
rights for a public purpose without compensation.
5
15. Appellants are appealing the Trial Court’s decision to grant
Defendant, the City of Terrell Hills’ Motion for Summary Judgment. The judgment
appealed from does not specify the reason for the Trial Court’s decision. CR 698.
This Court of Appeals should find for Defendant, the City of Terrell Hills, if any of
the City’s grounds for summary judgment are meritorious. Foster v. Denton Indep.
Sch. Dist., 73 S.W.3d 454, 464-465 (Tex. App. – Fort Worth, 2002); Carr v.
Brasher, 776 S.W.2d 567, 569 (Tex. 1989).
16. The City filed its Traditional and No-Evidence Motion for Summary
Judgment on all of Plaintiffs’ claims against the City (including inverse
condemnation/regulatory taking and declaratory judgment) on August 16, 2016.
(CR 581 to 651).
A. Summary Judgment Proper Because Plaintiffs Waived No Evidence
Issues
17. The grounds alleged by the City include a no-evidence motion that
Plaintiffs have provided no evidence of one or more of the material elements of
their claims. In particular, on the inverse condemnation claim Plaintiffs have
provided no evidence of a property right that was taken by the City, no evidence of
deprivation of all economically viable use of the Property or of unreasonable
interference with use of the property based on investment backed expectations, no
evidence that City action not substantially related to legitimate public purpose (if
6
the Court applies this element), and no evidence any action of the City was the
proximate cause of damages to Plaintiffs.
18. Appellants have failed to raise a viable issue on appeal with regard to
Defendant’s no evidence grounds for summary judgment and, for this reason, this
Court of Appeals should uphold the Trial Court’s Summary Judgment for
Defendant/Appellee on this ground with no need for further consideration of
Appellants’ issues.
B. Summary Judgment Proper on Jurisdictional Grounds
19. Defendant’s Motion for Summary Judgment also asserts alternative
grounds that Plaintiffs failed to establish jurisdiction because the jurisdictional
facts negate one or more elements Plaintiffs would need to establish to defeat
Defendant’s claims of immunity, lack of standing, failure to exhaust administrative
remedies, and ripeness.
20. Plaintiff has failed to properly invoke waiver of immunity under the
takings clause in the Texas Constitution primarily because Defendant has
demonstrated the taking of a property right is negated in this case. The undisputed
summary judgment evidence establishes the Property Plaintiffs were attempting to
up-zone to commercial zoning had been zoned semi-commercial (a transition area)
since the 1960s. This is not a fact situation like the one in the Sheffield case cited
by Appellants where a city passed regulations which down-zoned the uses allowed
7
on a developer’s property after he purchased it. Sheffield Dev. Co. v. City of Glenn
Heights, 140 S.W.3d 660, 663 (Tex. 2002). Landowners hold their property
subject to police regulations of the cities in which they are located. There is no
legal right to up-zone a property.
21. The Texas Constitution, Article I, Section 17 provides there is no
taking when the landowner consents. In this case, it is undisputed the prior owner
voluntarily abandoned the non-conforming commercial laundry use in the center
suites on the Property. Plaintiffs could not have acquired any rights to a takings
claim from the prior owners related to the termination of the non-conforming use.
It is also undisputed many property uses are allowed on a semi-commercial zoned
Property. Further, Plaintiffs have not been denied the right to use the center suites
for commercial uses because as Plaintiffs admit, the City granted Plaintiffs’
requests for Special Use Permits for the barber shop/hair salon uses requested.
There has been no legally recognized taking in this case and Plaintiffs failed to
invoke the waiver of immunity provided for a takings violation.
22. Defendant has established Appellants lack of standing to sue for a
regulatory taking for the same reasons discussed above. Additionally, Plaintiffs
failed to exhaust their administrative remedies as required for a takings claim
because they did not appeal the City staff interpretations of the zoning ordinance of
which Plaintiffs complain to the Zoning Board of Adjustment. For this same
8
reason, Plaintiffs’ causes of action are not ripe for adjudication. Plaintiffs have not
raised a question of material fact on any of these defenses established by
Defendant.
23. Appellants have addressed the defenses of subject matter jurisdiction,
immunity, standing and ripeness in Article 1 of their Brief which appears to
correspond with their Issue 1. Appellants fail to fully state the burden of proof on
these claims. Once Defendant establishes the elements of these defenses, which
Defendant has accomplished, the burden of proof shifts to Plaintiffs to raise a
genuine issue of material fact on these elements.
24. In its Motion for Summary Judgment Defendant established Plaintiffs
have failed to provide any evidence to create a genuine issue of material fact as to
the jurisdictional claims of Defendant and this Court of Appeals should uphold the
Trial Court’s judgment on the grounds of lack of jurisdiction without need to
examine Appellants’ arguments further.
C. Appellee’s Objections to Appellant’s Issues 2, 3, and 4 Which Were not Argued
in Plaintiffs’ Response to Defendant’s Motion for Summary Judgment
25. Defendant objects to three of Appellants’ issues which were not
argued in Plaintiffs’ Response to Defendant’s Motion for Summary Judgment:
1)(Appellants’ “Issue 2”) how the City’s regulation affects the balance between the
public and private interests; 2) (Appellants’ Issue 3”) whether the zoning of the
9
Property (as opposed to the previously argued denial of change in zoning) serves a
substantial public interest; and 3) (from Appellant’s “Issue 4”) whether Plaintiffs
were denied all economically viable use of the Property (although this was
mentioned in the pleading, no argument on this issue was presented in Plaintiffs’
Response to Defendant’s Motion for Summary Judgment). Appellee objects to the
three new issues because they were not raised in Plaintiffs’ Response to
Defendant’s Motion for Summary Judgment and for other reasons discussed
further below.
26. In Appellants’ “Issue 2,” discussed in Article II, Section C, and
Article IV of Appellants’ Brief, Appellants assert a fact issue exists regarding how
the City’s regulation of the Property affects the balance between public and private
interests. This is being raised for the first time and is not a valid issue for appeal.
27. In Appellants’ “Issue 3,” discussed in Article II, Section D, 2,
Appellants’ claim Defendant’s zoning of the Property does not serve a substantial
public interest. Plaintiffs’ Response to Defendant’s Motion for Summary Judgment
only addressed the substantial public interest test with respect to the City’s
decision to deny Plaintiffs’ request to up-zone the Property to commercial. That is
a different issue than a challenge to the substantial public interest in the City’s
decision in the 1960s to zone the property semi-commercial. If Plaintiffs intended
to argue this point on the 1960s zoning ordinance in Plaintiffs’ Response,
10
Defendant would have argued the statute of limitations argument raised in the
City’s Original Answer. Further, the City would have raised the issue previously
raised in the City’s Plea to the Jurisdiction that the Texas Attorney General’s
Office must be provided notice of the challenge to an existing law (such as the
zoning ordinance) before jurisdiction may attach. Further, the United States
Supreme Court in Lingle has backed away from the use of the substantial public
interest test in inverse condemnation cases, except in certain circumstances which
do not apply here. Lingle v. Chevron USA, Inc., 544 U.S. 528 (2005).
28. It would make more sense not to apply the substantial public interest
test in a case such as the present case where Plaintiffs have stated one of the
elements they need to prove for their takings claim is that the taking was for a
public purpose. By not arguing the substantial public interest test with regard to the
semi-commercial zoning of the Property in their Response Appellants have waived
this issue.
D. Summary Judgment Proper; No Fact Issue on Elements of Plaintiffs’ Claims
and Defendant Entitled to Judgment as a Matter of Law
29. In the alternative, if same be needed, and subject to the foregoing
objections, Defendant’s Motion for Summary Judgment asserts grounds that there
is no genuine issue of fact as to the negation of one or more of the elements of each
11
of Plaintiffs’ claims for which Plaintiffs would have the burden of proof at trial and
the City is entitled to judgment as a matter of law.
30. Appellants have failed to completely state the burden of proof on
summary judgment. In the event summary judgment is not upheld on the no-
evidence grounds or on the jurisdictional defenses raised by Defendant, it may still
be granted on the grounds that there is no genuine issue of fact as to the negation of
one or more elements of Plaintiffs’ causes of action and Defendant is entitled to
judgment as a matter of law. The burden of proof then shifts to Plaintiffs to provide
evidence sufficient to create a genuine issue of fact as to the elements negated.
31. Defendant has established there is no genuine question of material fact
as to one or more of the essential elements of Plaintiffs’ causes of action (inverse
condemnation/regulatory taking and declaratory judgment) and Defendant is
entitled to summary judgment on Plaintiffs’ causes of action as a matter of law. In
particular, the City did not act intentionally with reasonable certainty of the denial
of Plaintiff’s property rights. In fact, the City attempted to accommodate Plaintiffs’
needs by granting Plaintiff’s Special Use Permits for the uses requested.
32. Further, there has been no taking of a property right because there has
been no denial of all economically viable use of the Property and no unreasonable
interference with use of the Property based on reasonable investment backed
expectations. Plaintiffs are still free to use the Property for semi-commercial uses
12
and for commercial uses by obtaining Special Use Permits from the City. There is
no property right and no reasonable expectation to change the long-standing zoning
of a property, which in this case has been semi-commercial for over forty years,
which existed long before the purchase of the Property by Electro Sales and
Service. CR 612 to 616. There is no taking under the law when there is consent
which has been shown due to the voluntary abandonment and termination of a non-
conforming commercial use by the prior owners of the Property.
33. Plaintiffs have raised an issue based on the substantial advancement of
a public purpose test.
34. Subject to the foregoing objections, Appellants argument that the City
has not provided a rationale to show the semi-commercial zoning of Plaintiffs’
property and the refusal to rezone the Property to its prior commercial designation
or reinstate the former non-conforming use exception “effectuates a substantial
public purpose” is a red herring. See Appellants’ Brief at page 4. Plaintiffs Original
Petition does not include the element of substantial advancement of a legitimate
public purpose in Plaintiffs’ cause of action for taking, and instead, only indicates
Plaintiffs are basing their claim on alleged denial of economic viability and
unreasonable interference with use of the Property. See CR 170. In its Motion for
Summary Judgment the City discussed the change in the application of the
substantial advancement issue found in the Lingle case, but also provided argument
13
in the alternative regarding the presumption applied by the Courts in the favor of
finding a zoning ordinance substantially advances a legitimate government
purpose. CR 595 to 598. The City also attached the minutes of the City Council
meeting at which the transitional purpose of protecting abutting properties was
discussed. Because of the presumption in favor of a municipal zoning ordinance on
this issue, it is Plaintiffs’ burden to show conclusive evidence the ordinance is
arbitrary. See City of University Park v. Benners, 485 S.W.2d 773, 779 (Tex.
1972).
35. Appellants’ statement on page 4 of Appellants’ Brief that the City
refuses to allow commercial tenants in the center suites is contrary to the
undisputed facts admitted by Plaintiffs that the City has granted Special Use
Permits for the center suites for the commercial uses requested by Plaintiffs. As
seen in the minutes of the City Council attached to Defendant’s Motion for
Summary Judgment, the City Council has a legitimate concern regarding not
having any control over the types of commercial businesses which would be placed
in this transition zone if the zoning of the Property were to be changed to
commercial. The Special Use Permit process remedies this issue while still
allowing the uses requested by the landowner.
36. It is undisputed the City’s decision to zone the Property semi-
commercial occurred in the 1960s, long before the acquisition of the Property by
14
Electro Sales and Service. The prior commercial designation has not been in effect
since the 1960s. Any challenge to the decision in the 1960s would be barred by
limitations and waiver.
37. Further, the record reflects Plaintiffs have not met the prerequisite to
making a challenge to the zoning ordinance of notifying the Texas Attorney
General. For further argument, the City incorporates its discussion of this issue
from its Motion for Summary Judgment into this Brief as if set forth in full from
CR 595 to 598.
38. There is no dispute that in the 1960s when the zoning change occurred
the non-conforming use exception was allowed for particular uses which had
legally existed prior to the zoning change. CR 612 to 616. There is no dispute that
under the City’s ordinances the non-conforming use exception for each particular
use (in this case a laundromat) was to terminate whenever the use was abandoned
for six months. It is also undisputed that the non-conforming use in question was
voluntarily abandoned by the Engs before they sold the Property to Electro Sales
and Service. CR 612 -616.
39. The non-conforming use exception would have allowed the
landowners at the time of the zoning change in the 1960s to recoup their
investment backed expectations over time. In this case Plaintiffs have no right to
restart recoupment of the original landowner’s investment backed expectations
15
which would have already run. Plaintiffs can show no evidence of reasonable
investment backed expectations from their own purchase. Nothing has changed in
the zoning of the Property or the non-conforming use status of the center suites in
the Property since the date of the purchase by Electro Sales and Service. They can
still use the Property in the exact same manner as the date on which the purchase
was made. As purchasers of real estate Plaintiffs, not the public, should bear the
risk inherent in their own failure to investigate the zoning of the Property prior to
making their purchase.
40. Defendant has shown that the United States Supreme Court has
moved away from the use of a substantial relationship test except in certain cases
which do not apply here. CR 596. Lingle v. Chevron USA, Inc., 544 U.S. 528, 539
(2005).
41. If this Court of Appeals does determine the substantial relationship
test should apply here, Defendant has met its burden to show the relationship of the
City’s denial of up-zoning to the public purpose of maintaining the orderly
development of the City and providing transition zones between residential and
commercial areas to protect from the consequences of traffic congestion and
parking issues, and to insure orderly development of the City. The City has
provided evidence in the form of City Council hearing and meeting minutes that
this semi-commercial zone serves the purpose of a transition zone protecting
16
residential areas abutting the Property. CR 621 and 622. The Property has never
been zoned commercial and changing the zoning to commercial would mean that
rather than having a semi-commercial zone next to a residential area, the
residential zone would back up directly to a commercial zone. This would negate
what the City was trying to do in the 1960s when it created the semi-commercial
zone.
42. Plaintiffs now bear the burden to establish a question of fact on this
issue and they have not met that burden.
43. Page 4 and 5 of Appellants’ Brief contain factual statements which are
not supported by the only summary judgment evidence provided by Plaintiffs, Mr.
Merchant’s affidavit, and to which Appellee has objected elsewhere in this Brief.
Appellants argue the center suite is flanked by commercial businesses on either
side and throughout the entire area surrounding the Property. They conveniently
omit the residential neighbors backing up to the Property. Plaintiffs allege changes
in the area since the original zoning has passed, but provide no evidentiary support
for their arguments.
44. Appellants make a blanket statement that the center space has lost any
economic viability, but Plaintiffs have provided no evidence of this. Plaintiffs have
not mentioned, even in Merchant’s affidavit, any efforts to lease the space for any
of the numerous uses allowed in semi-commercial zoning. In fact, Mr. Eng
17
testified that he let the Laundromat out of their lease because they were no longer
making it financially and that he believed he could lease the space for a semi-
commercial office use.
45. Although it is not mentioned in Appellants’ list of issues, in Article II,
D and Article III of their Brief, Appellants also discuss their claim of unreasonable
interference with use and enjoyment of the Property. This issue was addressed in
Plaintiffs’ Response to Defendant’s Motion for Summary Judgment. However,
Plaintiffs failed to provide any evidence to support their claims and failed to raise a
genuine issue of fact to defeat Defendant’ summary judgment motion on this issue.
The Courts determine whether or not unreasonable interference has occurred based
primarily on investment backed expectations. Defendant has demonstrated
Plaintiffs could not have had reasonable investment backed expectations that the
center suites of the Property could be used for commercial uses where, as here, the
zoning of the Property had been changed to semi-commercial in the 1960s to serve
as a transition zone and the previous owner, Mr. Eng testified in deposition he told
Merchant the non-conforming use had terminated for the center suites. CR 615.
46. The only alleged evidence provided by Plaintiffs was the self-serving
and conclusory Affidavit of Salim Merchant (CR 682 to 895) to which Defendant
filed objections. Subject to this objection, the Affidavit failed to provide any
evidence demonstrating unreasonable interference with property rights or
18
reasonable investment backed expectations. Merchant provided no evidence as to
the relationship of the price of the Property to the semi-commercial zoning of the
Property and the previous termination of the non-conforming use of the laundromat
in the center suites.
47. Appellants have failed to address Defendant’s summary judgment
argument regarding Plaintiffs’ declaratory judgment claims and the Trial Court’s
decision to grant summary judgment for the Defendant should be upheld with
respect to these claims.
48. The Trial Court’s decision in favor of Defendant should stand.
OBJECTION TO CERTAIN OF APPELLANTS’ FACTUAL
ALLEGATIONS
49. Appellee objects to statements in Appellants’ Statement of Facts
(“Appellants’ Facts”) which are being raised for the first time on appeal or
otherwise differ from the facts as presented in Plaintiffs’ Response to Defendant’s
Motion for Summary Judgment (“Plaintiffs’ Summary Judgment Response”). (CR
654 – 656) Defendant further asserts there is no support in the summary judgment
evidence for these factual allegations and they should be stricken. (See Appellant’s
Brief at pg. 1).
50. In particular, Appellee objects to Appellants statement on page 1 that
the non-conforming use allowed the Property to be used by commercial enterprises
19
so long as it did not remain vacant for more than six months. Appellants have not
provided a citation to the record for this statement which revises earlier allegations
by Plaintiffs in a manner which fails to acknowledge the individual nature of the
non-conforming use allowance for each of the uses operated in the suites in the
Property.
51. Appellee further objects to Appellants’ statement on page 2 of
Appellants’ Brief without citation to any support that they made a request for
reinstatement of non-conforming use (in addition to the re-zoning request) which
came before Council on October 1, 2012, and was denied. This allegation was not
previously raised by Plaintiffs in their Response to Defendant’s Summary
Judgment Motion and should be stricken.
52. Appellee further objects to Appellants’ unsupported statement on page
2 in which Appellants state they were informed a barber shop violated the
prohibition against using the space for display or sale of merchandise. This
allegation was not previously raised by Plaintiffs in their Response to Defendant’s
Summary Judgment Motion and should be stricken.
53. Appellee further objects to the entire paragraph at the end of page 2
and the top of page 3 of Appellants’ Brief and requests that it be stricken.
Appellants make factual allegations not previously raised that neither permit
request was approved in a timely fashion, that one took six months, and the other
20
took over a year, and that Merchant lost two prospective tenants. Although
Plaintiffs do note pages in the Court Record for certain of these allegations, the
cited pages do not support these new factual allegations. It is impossible from the
cited references to determine the dates on which completed paperwork was
actually received by the City or even to connect the items referenced by Plaintiffs
in time. Further, there is no evidence in the summary judgment record of these two
alleged potential tenants, the timing of their submissions to the City of all required
paperwork, Plaintiffs’ alleged loss of two tenants, or any connection to the reasons
for any actions given. These objectionable facts as well as objectionable issues
raised for the first time on appeal are restated by Appellants in their Summary of
the Argument on pages 4 and 5 of Appellants’ Brief and Defendant requests these
two pages of Appellants’ Brief also be stricken.
54. Defendant renews its objection to the conclusory and self-serving
Affidavit of Salim Merchant originally stated in Defendant’s Reply in Support of
its Motion for Summary Judgment and incorporates herein for all purposes the
reasons for the objection set out therein. CR 688. Subject to this objection,
Appellee asserts the Affidavit does not provide any evidence sufficient to support
the statements alleged above by Plaintiffs.
55. Plaintiffs/Appellants refer to CR 227 on page 10 of Appellants’ Brief.
This page is a self-serving letter written by Plaintiff which is not supported by an
21
affidavit and is not proper summary judgment evidence. Plaintiffs did not refer to
this document in their Response to Defendant’s Motion for Summary Judgment
and have only referred to it now for the first time on appeal. For these reasons,
Appellee objects to Plaintiffs’ reference to CR 227 and requests any reference to
these documents by Plaintiffs/Appellants be stricken from the record.
ARGUMENT
I. The Trial Court’s Summary Judgment for the City should be upheld because
Plaintiffs/Appellants have not raised any issue on the City’s No-Evidence
grounds, and, alternatively, the Trial Court’s judgment should be upheld based
on defensive grounds of immunity, lack of standing, and lack of
ripeness/exhaustion of remedies. (Responds to Appellants’ Brief at pg. 6; ref.
Issue 1)
56. "When a trial court's order granting summary judgment does not
specify the grounds relied upon," as here, "the reviewing court must affirm
summary judgment if any of the summary judgment grounds are meritorious."
Wasson Interests, Ltd. v. City of Jacksonville, 489 S.W.3d 427, 439 (Tex. 2016);
FM Props. Operating Co. v. City of Austin, 22 S.W.3d 868, 872(Tex. 2000). The
Trial Court’s decision should be upheld if any one of Defendant’s grounds for
summary judgment was meritorious.
57. The City’s Traditional and No-Evidence Motion for Summary
Judgment filed August 16, 2016 (CR 581 to 651), alleges the following grounds:
22
a. There is no property right to a change in zoning in this case, and there can
be no taking when the City allowed the Plaintiffs a special use permit for
the requested use; as a result, Plaintiffs have failed to plead a claim which
would waive the City’s immunity. Plaintiffs have also failed to establish
standing to sue since the semi-commercial zoning classification occurred
in the 1960s and the previous property owners intentionally allowed the
non-conforming commercial use of the center suites to terminate;
b. Alternatively, Plaintiffs failed to exhaust administrative remedies
available because they did not appeal administrative decisions of City
staff to the Zoning Board of Adjustment;
c. Alternatively, Plaintiffs’ claims are not ripe;
d. Alternatively, Plaintiff has failed to provide evidence to create a genuine
issue of material fact to defeat summary judgment for the City on the
grounds that the denial to up-zone the Property does not deny Plaintiff all
economically viable use of the Property or unreasonably interfere with
Plaintiff’s right to use and enjoy the Property and is not a regulatory
taking as a matter of law (there should be no substantial advancement of
public interest test; however, if the Court looks at whether the City’s
decisions substantially advanced legitimate city interests, Plaintiffs have
also failed to produce any evidence to raise a question of fact on this
issue);
e. Plaintiffs’ declaratory judgment action is filed only to seek attorney’s fees,
will not resolve ripe justiciable issues between the parties, and should be
dismissed as a matter of law; and
f. Alternatively, Plaintiffs have provided no evidence of one or more of the
material elements of their claims; no evidence of property right that was
taken by the City, no evidence of deprivation of economically viable use
of the Property or of investment backed expectations, and no evidence any
action of the City was the proximate cause of damages.
CR 583 to 585.
23
58. To the extent Plaintiffs attempt to seek remedy for the zoning decision
of the City made in the 1960s, Defendant has also raised the defense of limitations
in its Original Answer.
I-1. Appellants have failed to raise an issue on appeal regarding the no
evidence portion of Defendant’s Motion for Summary Judgment and on the
declaratory judgment grounds and summary judgment should be upheld on
these grounds.
59. Appellants have not raised an issue on appeal related to Defendant’s
no-evidence grounds for summary judgment and the grounds related to declaratory
judgment. See Appellant’s Brief at page x. For this reason, Appellants have waived
any argument on appeal related to these issues and the judgment of the Trial Court
in favor of Defendant should be upheld on these grounds without the need for
further analysis of Appellants’ Issues. Only in the event this Court of Appeals
considers further argument on this issue Appellee offers the following:
For a no-evidence summary judgment, as alleged in paragraph 31 of
Defendant’s Motion for Summary Judgment, the movant can move for
summary judgment even with no evidence on the grounds that there is
no evidence of one or more essential elements of a claim or defense
on which the non-movant has the burden of proof. The burden then
shifts to the non-movant to present evidence raising an issue of
material fact. King Ranch Inc. v. Chapman, 118 S.W.3d 742, 751
(Tex. 2003); EPGT Tex. Pipeline, L.P. 176 S.W.3d at 334-335; see
TEX. R. CIV. P. 166a(i); Flameout Design & Fabrication, Inc. v.
Pennzoil Caspian Corp., 994 S.W.2d 830, 834 (Tex. App.--Houston
[1st Dist.] 1999, no pet.).
24
60. A trial court must grant a no-evidence summary judgment motion
unless the non-movant produces summary judgment evidence that raises a genuine
issue of material fact. See TEX. R. CIV. P. 166a(i) cmt.; Moore v. K Mart Corp.,
981 S.W.2d 266, 269 (Tex. App.--San Antonio 1998, pet. denied); Jackson v.
Fiesta Mart, Inc., 979 S.W.2d 68, 71 (Tex. App.--Austin 1998, no pet.); Foster v.
Denton Indep. Sch. Dist., 73 S.W.3d 454, 464-465.
61. Article I, Section 17 of the Texas Constitution ("the inverse
condemnation clause") provides, in part: "No person's property shall be taken,
damaged or destroyed for or applied to public use without adequate compensation
being made, unless by the consent of such person." TEX. CONST. art. I, § 17. To
demonstrate a constitutional inverse condemnation, the landowner must show: (1)
the State intentionally performed certain acts in the exercise of its lawful authority
(intent); (2) that resulted in the taking, damaging, or destroying of property
(causation); and (3) for public use (public use). Gen'l Servs. Comm'n v. Little-Tex
Insulation Co., 39 S.W.3d 591, 598 (Tex. 2001); Steele, 603 S.W.2d at 791.
62. Inverse condemnation occurs when property is taken, damaged, or
destroyed for public use without process or without proper condemnation
proceedings, and the property owner attempts to recover compensation. City of
Abilene v. Burk Royalty Co., 470 S.W.2d 643, 646, 14 Tex. Sup. Ct. J. 489 (Tex.
1971); Allen v. City of Texas City, 775 S.W.2d 863, 864 (Tex. App.--Houston [1st
25
Dist.] 1989, writ denied); EPGT Tex. Pipeline, L.P. v. Harris County Flood
Control Dist., 176 S.W.3d 330, 341-342.
63. Plaintiffs have failed to produce any evidence to support the elements
of a claim for inverse condemnation/regulatory taking. A regulatory taking occurs
when the government imposes restrictions that either deprive the owner of all
economically viable use of the property or unreasonably interfere with his right to
use and enjoy the property (a substantial advancement test may also be applied in
certain circumstances). See, Mayhew v. Town of Sunnyvale, 964 S.W.2d 922, 933-
935 (Tex. 1998). Whether particular facts are sufficient to allege a constitutional
taking is a question of law. City of Dallas v. Blanton, 200 S.W.3d 266, 271 (Tex.
App.--Dallas 2006, no pet.).
64. A compensable regulatory taking occurs when a governmental agency
imposes restrictions that unreasonably interfere with a landowner's right to use and
enjoy his property, such as denying a permit for development. See Mayhew, 964
S.W.2d at 933. In the present case, the undisputed facts show that the Property was
developed decades ago, the center suites on the Property may still be used as zoned
for semi-commercial use, and the City has granted Plaintiffs Special Use Permits
for commercial uses of the center suites on the Property.
65. In its Motion for Summary Judgment, Defendant asserted that
Plaintiffs provided no evidence of one or more of the material elements of their
26
claims, specifically: that a property right was intentionally taken by the City for
public use; that they were deprived of all economically viable use of the Property
or that any action of the City unreasonably deprived them of the use of the
Property based on reasonable investment backed expectations (or, if considered by
the Court, that the City’s regulations were not substantially related to a public
purpose); or that any action of the City was the proximate cause of any damages to
Plaintiffs.
66. Plaintiffs have failed to provide any evidence to demonstrate the
existence of a property right which was taken by the City’s regulations. Plaintiff,
Salim Merchant has also provided no evidence of his personal ownership interest
in the Property.
67. There is no protected property right to have the zoning of a property
changed in a manner inconsistent with the local governing authority’s long-
established zoning classification of a property. There is no property right to have a
non-conforming use privilege reinstated after the use has been abandoned by the
previous owners. Appellants would be unable to provide any case law
demonstrating such a right.
68. Subject to Defendant’s objection to Appellants’ failure to make any
argument as to economic viability in its Response to Defendant’s Motion for
Summary Judgment, Appellee asserts Plaintiffs have provided no evidence despite
27
extensive discovery in the case and could not provide evidence of the denial of all
economically viable use of the Property, or even of any unreasonable interference
with Plaintiffs’ use of the Property.
69. It is undisputed the Property has been zoned semi-commercial since
the 1960s and that this zoning allows the use of the center suites for a number of
semi-commercial uses, such as offices. Plaintiffs have failed to provide any
evidence of any failed attempts to operate an office or other semi-commercial use
at the site. It is undisputed the City has granted Plaintiffs Special Use Permits
allowing the uses requested by Plaintiffs. Plaintiffs have failed to provide any
evidence to support their claims.
70. Appellants claim the City has failed to establish it acted in accordance
with a substantial public interest. Subject to Defendant’s assertion that the
substantial advancement test should not be applied in this case after Lingle,
Plaintiffs have failed to demonstrate the City’s denial of their zoning change
request did not support the City’s substantial public interest in having transition
zoning such as semi-commercial zoning between commercial areas and residential
areas as reflected in related City Council minutes, and the recognized zoning
benefits of protecting neighbors from traffic congestion and parking issues, and
providing for the orderly development and growth of the City.
28
71. Because Appellants did not raise an issue on appeal as to the no-
evidence argument, they have waived any claim that the Trial Court should not
have granted summary judgment on the no-evidence grounds. The Trial Court’s
judgment was correct on these grounds.
72. Additionally, Plaintiffs have failed to raise an issue on appeal as to the
declaratory judgment cause of action and the Trial Court’s decision on that claim
should be upheld.
A. Standard and scope of review for subject matter
jurisdiction (Responds to Appellants’ Brief at pg. 6)
73. Alternatively, if same be necessary, the Trial Court was correct in
granting summary judgment for Defendant on all of its jurisdictional grounds,
including immunity, lack of standing, ripeness and failure to exhaust
administrative remedies. Appellee’s response to Appellants’ issues related to the
defenses follow. For further argument related to Defendant’s entitlement to
summary judgment on these defenses, Defendant incorporates herein as set forth in
full its related arguments from its Summary Judgment Motion at CR 590 to 594, its
Reply in Support of its Summary Judgment Motion at CR 689 to 692, and Plea to
Jurisdiction, CR 184 to 187.
74. Appellants have recognized on page 7 of Appellants’ Brief that they
have a burden to show that there is a disputed material fact regarding the
29
jurisdictional issue. Plaintiffs failed to meet that burden for any of the jurisdictional
issues.
75. Summary judgment for a defendant is proper if the defendant negates
at least one element of each of the plaintiff's theories of recovery, or pleads and
conclusively establishes each element of an affirmative defense. EPGT Tex.
Pipeline, L.P. v. Harris County Flood Control Dist., 176 S.W.3d 330, 334-335
(Tex. App.—Houston, 2004, pet’n dismissed); Science Spectrum, Inc. v. Martinez,
941 S.W.2d 910, 911, 40 Tex. Sup. Ct. J. 438 (Tex. 1997).
76. A motion for summary judgment may raise a challenge to a trial
court's subject-matter jurisdiction. City of Hedwig Village Planning & Zoning
Comm'n v. Howeth Invs., Inc., 73 S.W.3d 389, 391 (Tex. App.--Houston [1st Dist.]
2002, no pet.). A plaintiff then bears the burden of alleging facts affirmatively
showing the trial court has subject-matter jurisdiction. Tex. Dep't of Parks &
Wildlife v. Miranda, 133 S.W.3d 217, 226, 47 Tex. Sup. Ct. J. 386 (Tex. 2004);
Bland ISD v. Blue, 34 S.W.3d 547, 554, 44 Tex. Sup. Ct. J. 125 (Tex. 2000); Tex.
Ass'n of Bus. v. Tex. Air Control Bd., 852 S.W.2d 440, 446, 36 Tex. Sup. Ct. J. 607
(Tex. 1993); see also, McMahon Contracting, L.P. v. City of Carrollton, 277
S.W.3d 458, 464 (Tex. App.-Dallas 2009, pet. denied).
77. The question of whether a trial court has subject-matter jurisdiction
over a claim is one of law, and is reviewed de novo. Miranda, 133 S.W.3d at 226.
30
B. Plaintiffs Failed to Raise Valid Regulatory Takings Claim;
City Entitled to Sovereign Immunity (Responds to Appellants’
Brief at pg. 7)
78. Under the common-law doctrine of sovereign immunity, a unit of
government cannot be sued without its consent. State v. Terrell, 588 S.W.2d 784,
785, 22 Tex. Sup. Ct. J. 543 (Tex. 1979); Dillard v. Austin Indep. Sch. Dist., 806
S.W.2d 589, 592 (Tex. App.--Austin 1991, writ denied).
79. Governmental immunity protects a city from suit when it exercises its
governmental functions unless that immunity is clearly waived. See City of Dallas
v. Blanton, 200 S.W.3d 266, 271 (Tex. App.--Dallas 2006, no pet.). Although the
Texas Constitution waives immunity for a validly pled inverse condemnation
claim, when a plaintiff does not allege a valid inverse condemnation claim,
governmental immunity applies. Id.
80. On pages 7 and 8 of Appellants’ Brief Appellants have incorrectly
provided a standard based on a review of a denial of a plea to the jurisdiction based
solely on a plaintiff’s pleadings. In the present case, the jurisdictional issues,
including immunity are raised in a summary judgment motion and the Court may
consider evidence to resolve the jurisdictional issues.
81. To defeat a government entity's jurisdictional immunity claim, a
landowner must provide evidence to establish a fact issue with regard to the waiver
of immunity. Therefore, if a plaintiff cannot raise a fact issue with regard to its
31
inverse condemnation cause of action, there is no waiver of immunity, and the trial
court lacks subject-matter jurisdiction. Tex. Dep't of Transp. v. A.P.I. Pipe &
Supply, LLC, 397 S.W.3d 162, 166 (Tex. 2013). To satisfy this burden, the
landowner must raise a fact issue as to one of the elements of inverse
condemnation: intent, causation, or public use. See Miranda, 133 S.W.3d at 226-
228 (holding pleas to the jurisdiction generally follow summary judgment burden
of proof); but see City of San Antonio v. El Dorado Amusement Co., Inc., 195
S.W.3d 238, 244 (Tex. App.--San Antonio 2006, pet. denied) (a public use is not a
necessary component of a regulatory taking).
82. In an inverse condemnation case, once the movant has demonstrated it
is a government entity entitled to immunity and presented its defense that the Court
lacks jurisdiction, the burden of proof shifts to the non-movant to show a material
fact issue exists regarding the jurisdictional issue, that is, waiver of movant’s
immunity. See Miranda, 133 S.W.3d at 228; City of San Antonio v. Rogers
Shavano Ranch, Ltd., 383 S.W.3d at 241; see also, EPGT Tex. Pipeline, L.P. 176
S.W.3d at 334-335; Medrano v. City of Pearsall, 989 S.W.2d 141, 144 (Tex. App.-
-San Antonio 1999, no pet.); Ager v. Wichita Gen. Hosp., 977 S.W.2d 658, 660
(Tex. App.--Fort Worth 1998, no pet.); See also, EPGT Tex. Pipeline, L.P. 176
S.W.3d at 334-335.
32
83. In the present case the City is a governmental entity and has met its
initial burden to demonstrate it is a governmental entity entitled to immunity unless
Plaintiff can show a valid waiver of immunity. As discussed further below,
Defendant has demonstrated there has been no taking of a valid property right in
this case to support waiver of immunity under an inverse condemnation claim
because the Property has been zoned semi-commercial for over 40 years, the
cessation of the non-conforming commercial use in the center suites was
consensual and prior to Plaintiffs’ ownership of the Property, and the City has
allowed Plaintiffs the uses they requested by Special Use Permits.
84. Plaintiffs have failed to meet their burden to show a material fact issue
exists regarding the jurisdictional issue. On pages 8 and 9 of Appellants’ Brief
Plaintiffs rely entirely on their own statements in their pleadings to support their
jurisdictional argument and provide no evidence to create a material fact issue.
85. Further, Defendant is entitled to dismissal of Plaintiffs’ claims as a
matter of law because Plaintiff’s own facts as plead show Defendant granted
Plaintiffs the uses they requested in the form of Special Use Permits, a fact which
negates the takings element Plaintiffs would need to demonstrate in order to invoke
waiver of immunity under takings law.
86. Additionally, City Council minutes attached to the City’s Summary
Judgment Motion reflect this area is a transition zone abutting up to residential
33
property. CR 622. This type of zoning serves the purpose of protecting residential
areas from increased traffic, parking congestion, and provides for orderly
development of the City. Plaintiffs failed to provide any evidence to demonstrate
facts which would support the elements of a valid inverse condemnation claim by
regulatory taking. As a result, Plaintiffs have failed to meet their burden of
demonstrating facts to establish a genuine issue of fact regarding the City’s
entitlement to immunity.
87. In the present case, Plaintiffs can show no valid claim for inverse
condemnation, and therefore, the City’s immunity to suit and liability are not
waived as to Plaintiffs’ claims. Plaintiffs have not demonstrated a legal claim for
taking of a property right and have failed to present any evidence of their claims
despite extensive time for discovery in the case.
88. There can be no taking where, as here, there has been no action by the
City to take any property right. There is no legally protected property right to a
change in zoning as requested by Plaintiffs. A landowner’s use of the land is
subject to police power regulations of the relevant city, including zoning
regulations passed in accordance with regulations in the Texas Local Government
Code.
89. There also can be no taking where, as here, there is consent. The
previous property owner intentionally abandoned and therefore, consented to the
34
termination of the non-conforming use status of the laundromat in the center suites
because the laundromat was failing and he intended to lease the suites for “Semi-
Commercial” office uses.
90. Further, there can be no taking where, as here, Plaintiffs have been
free to use the Property for the use they requested. It is undisputed the City granted
Plaintiffs Special Use Permits on more than one occasion to allow Plaintiffs to
lease the Property for the uses requested. CR 655.
91. On pages 8 and 9 of Appellants Brief Appellants appear to be basing
their response to Defendant’s immunity grounds on Plaintiffs’ pleading allegations
and on unsupported factual allegations raised for the first time on appeal to which
Appellee has objected. These allegations and unsupported facts are not sufficient to
raise a question of fact to defeat Defendant’s immunity.
92. Plaintiffs list factors related to a “viable allegation” from City of
Dallas v. VSC, LLC, 347 S.W.3d at 236. The facts in the present case do not rise
to the level contemplated in these factors. There can be no credible allegation of
ouster, unreasonable restrictions, or overly burdensome standards when Plaintiffs
are simply subject to the zoning that existed on the Property when they bought the
Property and have by their own admission been given special use permits for the
uses he requested, including a barber shop use. CR 655. If Plaintiff’s claims
constitute a taking, then landowners all over the land could claim a taking simply
35
because they are subject to zoning classifications set by cities. There is no legal
precedent for any such claim to rise to a valid takings case. Plaintiffs do not
provide evidence of factual elements to support these legal conclusions.
93. Because Plaintiffs have failed to demonstrate a viable regulatory
takings claim, the City retains its immunity. See Hearts Bluff Game Ranch, Inc. v.
State, 381 S.W.3d 468, 476 (Tex. 2012). The Trial Court’s judgment for Defendant
should be upheld on immunity grounds.
C. Plaintiffs have not provided evidence to create a fact issue
to demonstrate they have standing to sue. (Responds to
Appellants, Brief at pg. 9).
94. Standing is not an affirmative defense but is a legal question regarding
subject-matter jurisdiction. See Texas Ass’n of Business v. Texas Air Control Bd.,
852 S.W.2d 440, 1993 Tex. LEXIS 22, 36 Tex. Sup. J. 607 (Tex. 1993) . Plaintiffs
have no standing to sue for the cessation of the non-conforming use in the middle
suite. Plaintiffs were not personally aggrieved because the non-conforming use was
voluntarily abandoned prior to the purchase of the Property. The right to sue for the
injury is a personal right belonging to the person owning the property at the time of
the injury. Denman v. Citgo Pipeline Co., 123 S.W.3d 728 (Tex. App. Texarkana
2003) relying on Abbott v. City of Princeton, 721 S.W.2d 872, 875 (Tex. App.--
Dallas 1986, writ ref'd n.r.e.); Lay v. Aetna Ins. Co., 599 S.W.2d 684, 686 (Tex.
36
Civ. App.--Austin 1980, writ ref'd n.r.e.). Therefore, without express provision, the
right does not pass to a subsequent purchaser of the property. Denman, supra;
Abbott, 721 S.W.2d at 875; Lay, 599 S.W.2d at 686. “A mere subsequent
purchaser cannot recover for an injury committed before his or her purchase.”
Denman, supra; Lay, 599 S.W.2d at 686.
95. Here, it is undisputed that Electro Sales and Service bought the
Property from the Eng Defendants after the non-conforming use expired and that
the regulatory zoning classification of the Property was put in place over 40 years
prior to the purchase. CR 613 to 615 and 696. Therefore, Plaintiffs’ unsupported
assertion that standing was somehow acquired when the Property was purchased
fails to raise a genuine issue of material fact.
96. Plaintiffs’ allegations on pages 9 and 10 of Appellants’ Brief are not
supported by summary judgment evidence. Plaintiffs further lack standing because
their claims are not ripe as discussed further below. Merchant also lacks standing
because he has not provided any evidence of individual ownership in the Property.
97. For these reasons the Trial Court’s summary judgment should be
upheld on grounds of lack of standing.
37
D. Plaintiffs’ claims are not ripe because Plaintiffs failed to
establish futility of other options available (Responds to
Appellants’ Brief at pg.10)
98. Appellants fail to raise an issue of fact and they are barred as a matter
of law from litigating a regulatory takings claim based on 1) the cessation of the
nonconforming use in the middle suite of the Property and 2) the denial of a barber
shop in a semi-commercial district because they failed to exhaust administrative
remedies to appeal those administrative enforcement decisions to the Board of
Adjustment. See Tex. Loc. Gov’t Code Ann §§211.009(a), 211.010 and 211.011.
Appellants have failed to address the lack of appeal to the Board of Adjustment on
either a ripeness or exhaustion of administrative remedies argument and have
failed to provide any evidence that such an appeal would be futile.
99. Plaintiffs base their takings claim and declaratory judgment claim in
large measure on the City staff’s interpretation and enforcement of the zoning
ordinances, specifically that prior to purchase of the Property the nonconforming
use in the middle suite on the Property ceased, and that a barber shop was not an
allowable use in the middle suite after the cessation of the nonconforming use and
its reversion back to semi-commercial zoning. However, there is no evidence that
Plaintiffs timely appealed these administrative decisions to the Board of
Adjustment as required by Section XV of the City’s Zoning Code. City of Terrell
Hills Code of Ordinances Ch14, Sec. XV
38
100. Under Chapter 14, Section XV of the Zoning Code, appeals to the
Board of Adjustment may be taken by any person aggrieved or by any officer,
department, board or bureau of the municipality affected by any decision of the
administrative officer. See CR 646 to 648 – Zoning Code, Ch. 14 Sec. XV
(2)(b)(1). Chapter 14 of the Zoning Code further defines what a “reasonable time”
is for the purposes of appealing a decision of a City administrative officer to the
Terrell Hills Board of Adjustment. Id. Such appeal shall be taken with ten (10)
days from the date of any such ruling, by filing with the officer from whom the
appeal is taken and with the Board of Adjustment a notice of appeal specifying the
grounds thereof. Id.
101. Here, Plaintiffs failed to obtain a final ruling from the City through
the appellate process set out in TEX. LOC. GOV’T CODE § 211.010(b) and the
Zoning Code, Ch. 14 Sec. XV (2)(b)(1). Plaintiff’s failure to timely appeal the
decisions of the City staff in compliance with the City’s appellate process bars
Plaintiff from litigating both the decision relating to the cessation of the
nonconforming use for the middle suite of the Property and the decision that the
barber shop was not an allowed semi-commercial use in the middle suite. As a
result, the City is entitled to dismissal of Plaintiff’s claims related to these decision.
102. Plaintiffs’ statement on pages 10 and 11 of Appellants’ Brief that
“Appealing to some review board for which the City Council is the convening
39
authority would have been futile since the City Council has the final say” defies
the entire due process system which the Board of Adjustment Procedures set out in
the Texas Local Government Code. Appellants did not even try to appeal to the
Board and base their argument on one decision by City Council, which simply is
not enough to demonstrate futility of appeal to the Board of Adjustment
103. In addition, Plaintiffs’ assertion that they obtained a final decision
denying the request to up-zone the Property to commercial fails to satisfy a
ripeness inquiry on the takings claim. The facts are undisputed that the City
granted Plaintiffs’ applications for a Special Use Permit allowing additional
permitted uses for the Property, including a barber shop/hair salon. There is no
final decision and the City has not closed the door to continued future uses for the
middle suite of the Property. See Hamilton Bank Williamson County Reg’l
Planning Comm’n v. Hamilton Bank, 473 U.S. 172, 186 (1985).
104. Ripeness is an element of subject matter jurisdiction. State Bar of
Texas v. Gomez, 891 S.W.2d 243, 245 (Tex. 1994). As such, ripeness is a legal
question. Texas Ass'n of Business v. Texas Air Control Bd., 852 S.W.2d 440, 444-
45 (Tex. 1993). A takings claim is not ripe for court action until a final decision
about what level of use will be permitted on the property. See Public Util. Comm’n
v. Houston Lighting & Power Co., 748 S.W.2d 439 (Tex. 1987) (“A court has no
jurisdiction to render an advisory opinion on a controversy that is not yet ripe.”).
40
“[T]he ripeness doctrine conserves judicial time and resources for real and current
controversies, rather than abstract, hypothetical, or remote disputes. Browning-
Ferris, Inc. v. Brazoria County, 742 S.W.2d 43, 49 (Tex. App.--Austin 1987, no
writ). In order for a regulatory takings claim to be ripe, there must be a final
decision regarding the application of the regulations to the property at issue.
Hamilton Bank at 186.
105. Here, the undisputed facts clearly demonstrate that the City granted
Plaintiffs’ applications for a Special Use Permit allowing additional permitted uses
for the Property, including a barber shop/hair salon. Plaintiffs cannot demonstrate
that the City ever shut its door to continued future uses for the middle suite of the
Property. Since the possibility remains that Plaintiffs’ future use requests would be
granted by the City, there can be no taking.
106. The existing zoning of the middle suite of the Property when Plaintiffs
acquired the Property was semi-commercial, and the City is allowing Plaintiffs
uses greater than the stated semi-commercial zoning for the Property. It would be
premature to request a court or jury to make a determination whether a
compensable taking has occurred under such circumstances when the undisputed
facts demonstrate that the City is likely to continue approving uses for the Property
above the stated semi-commercial zoning for the Property. As such, Plaintiffs’
41
claim is premature, and the Trial Court’s summary judgment in favor of the City
should be upheld on these grounds.
II. No inverse condemnation/taking can be demonstrated because there is no
intentional taking and no property right in having one’s zoning changed to
commercial or in reinstating a non-conforming use abandoned by a predecessor
in interest (Responds to Appellants’ Brief at pg. 11; ref. issues 2, 3 and 4).
107. Alternatively, if same be necessary, the Trial Court was correct in
granting summary judgment because Defendant has established there is no genuine
issue of material fact on one or more elements of Plaintiffs’ causes of action and
that Defendant is entitled to judgment as a matter of law. Plaintiffs failed to present
evidence to raise a genuine issue of material fact as to whether or not a taking of a
valid property right occurred or to demonstrate any unreasonable interference with
the property rights of Plaintiffs, and other issues related to declaratory judgment
and attorneys’ fees claims.
A. Traditional summary judgment standards of review (Responds to
Appellants’ Brief at pg. 11)
108. Summary judgment for a defendant is proper if the defendant negates
at least one element of each of the plaintiff's theories of recovery, or pleads and
conclusively establishes each element of an affirmative defense. EPGT Tex.
Pipeline, L.P. v. Harris County Flood Control Dist., 176 S.W.3d 330, 334-335
42
(Tex. App.—Houston, 2004, pet’n dismissed); Science Spectrum, Inc. v. Martinez,
941 S.W.2d 910, 911, 40 Tex. Sup. Ct. J. 438 (Tex. 1997).
109. However, Appellants have failed to include the complete standards for
the traditional summary judgment as raised by Defendant. For a traditional motion,
as stated in Paragraph 30 of Defendant’s Motion for Summary Judgment (CR 589),
once the movant establishes the right to judgment as a matter of law, the burden
shifts to the non-movant who must then set forth sufficient evidence to create an
issue of material fact. City of Houston v. Clear Creek Basin Auth., 589 S.W.2nd
671, 678 (Tex. 1979).
110. Since Defendant has met its burden, Plaintiffs would need to produce
facts to demonstrate a genuine issue of fact on each of the elements of Plaintiffs’
claims in order to defeat summary judgment. In the case of the inverse
condemnation/regulatory taking claim, Appellants would need to demonstrate an
ownership interest in the property, an intentional action by the City (for which the
City knew with reasonable certainty would have the result of taking Plaintiffs’
Property), that the action either denied them of all economically viable use of their
property or unreasonably interfered with their right to use and enjoyment of the
property based on reasonable investment backed expectations (or failed to
substantially advance a legitimate public interest, if the Court applies this test).
43
B. Appellee Objects to Appellants’ “Issue 2” (Balance Between
Public and Private Interests) Raised for First Time on Appeal and Not a
Relevant Issue (Responds to Appellants’ Brief at pg. 11 and pg. 21; ref.
Issue 2)
111. Appellants’ “Issue 2” argues there is a fact issue regarding how the
City’s regulation affects the balance between the public interest and that of the
private landowner. See Appellants’ Brief at pg. x. Defendant objects to this Issue 2
because Plaintiffs are raising this argument for the first time on appeal. Plaintiffs
failed to raise this issue in their response to Defendant’s Motion for Summary
Judgment. See CR 658 to 680. Defendant requests that this Court of Appeals strike
“Issue 2” and related argument at II, C and IV from Appellants’ Brief.
112. Subject to and without waiving the foregoing objection Defendant
asserts this issue is not material to the summary judgment issues because it is not
one of the elements of Plaintiffs’ cause of action for inverse condemnation or of
the City’s defenses. As stated by the Supreme Court in Lingle, the primary factors
are the economic impact of the regulation on the claimant and, particularly, the
extent to which the regulation has interfered with investment backed expectations.
Lingle v. Chevron U.S.A. Inc., 544 U.S. 528, 538-40 (2005). A question of fact as
to a non-material issue will not defeat a summary judgment motion.
C. Subject to the foregoing objection, Defendant City not required to
prove that public interest in its zoning restrictions outweighs the private
burden on Plaintiffs, property, Plaintiffs failed to present any evidence
44
on this issue or raise question of fact (Responds to Appellants’ Brief at
pg. 13 ref. Issue 2)
1. Subject to the foregoing objection, Appellee further objects
to Appellants argument because Appellants are challenging
the zoning ordinance on these grounds for the first time on
appeal. If the Summary judgment burden on City is to
establish conditions support passage and/or maintenance of
the zoning ordinance or make the issue arguable, which
Appellee does not admit, the City has met its burden and
Plaintiff has the burden to raise a genuine issue of material
fact (Responds to Appellants’ Brief at pg. 13).
113. Subject to and without waiving the foregoing objection, Appellee
responds to this argument in the following paragraphs in the event the Court
determines it should consider this argument. At page 11 of their Brief, Appellants
cite to the Texas Supreme Court decision in Sheffield for their proposition that the
Court is required to balance the public’s interest against that of the landowners.
The Sheffield case differs from the present case because Sheffield involved an
actual downzoning of undeveloped property by the City of Glenn Heights reducing
the number of residences that the owner/developer could build on the property.
Sheffield Dev. Co. v. City of Glenn Heights, 140 S.W.3d 660, 663 (Tex. 2002). In
Sheffield the Texas Supreme Court reversed the Appellate Court’s decision and
rendered a take nothing judgment in favor of the City on the developer’s takings
claim, finding that the down-zoning did not go too far and was not a taking.
Sheffield, 140 S.W.3d at 679.
45
114. In making its decision in Sheffield, the Texas Supreme Court noted
that the City's zoning decisions, apart from the faulty way they were reached, were
not materially different from zoning decisions made by cities every day. Id. The
Court also stated the down-zoning in Sheffield differed from the refusal to up-zone
found in the Mayhew decision where the City was maintaining the status quo in
any area which had a particular zoning classification for many years. Id; see also,
Mayhew v. Town of Sunnyvale, 964 S.W.2d 922, 936 (Tex. 1998)
115. The Texas Supreme Court discussed in Sheffield that the takings
clause does not charge the government with guaranteeing the profitability of every
piece of land subject to its authority. Sheffield, 140 S.W.3d at 677. Purchasing and
developing real estate carries with it certain financial risks, and it is not the
government's duty to underwrite this risk as an extension of obligations under the
takings clause. Id. 87
116. Similarly, in the present case, Merchant was an experienced purchaser
of property for his leasing business and undertook his own risk in not researching
the zoning of the Property before he made his purchase. Applying the Texas
Supreme Court’s analysis in Sheffield, the City of Terrell Hills’ action, not to
down-zone a property as in Sheffield, but to deny an up-zoning of the Property in
87 Taub v. City of Deer Park, 882 S.W.2d 824, 826 (Tex. 1994).
46
order to maintain the long-standing zoning of the Property as in Mayhew, does not
rise to the level of a taking.
117. With regard to the substantial advancement test, the Texas Supreme
Court stated in Sheffield that the Supreme Court appears to have equivocated
somewhat on its statement in Agins (that a substantial advancement test is
appropriate) outside the context of cases involving required dedications or
exactions. See, Id. at 673. However, the Court in Sheffield went on to apply the test
in this case. Sheffield, 140 S.W.3d at 674. They did not think it must be proved to a
certainty and stated that the actual effects of the City's rezoning are for the future
and can only be projected and estimated. Id. at 676. They supported the court of
appeals conclusion that the City's rezoning substantially advanced its interests in
avoiding the ill effects of urbanization and preserving the rate and character of
community growth. Id.
118. In the present case, Defendant demonstrated the public interest in not
up-zoning the Property because it is currently transition zoning, which protects
neighboring properties. Defendant’s Summary Judgment Motion asserted such
zoning accomplishes the public purposes of protection from traffic congestion and
to provide for the orderly development of the community. Minutes of the City
Council of the City of Terrell Hills of August 8, 2011 show that the City Council
discussed a request by Merchant to re-zone the Property to “Commercial”, but City
47
Council denied the request, discussing the fact that this area is a transition zone and
there are immediate neighbors who would be directly affected. CR 622.
119. Because Defendant has met its burden for summary judgment, the
burden shifted to Plaintiffs to provide evidence to establish a genuine issue of
material fact. Plaintiffs failed to provide evidence of the alleged economic impact
and alleged degree of interference with legitimate property interests. These issues
are not strictly within the City’s knowledge and purview as argued by Plaintiffs.
The decision of the Trial Court should be upheld on these grounds.
120. Generally, a property owner has no vested right to use its property in a
certain way without restriction. See Azadpour v. City of Grapevine, No. 02-13-
00323- CV, 2014 WL 2566024, at *4 (Tex. App.––Fort Worth June 5, 2014, pet.
denied) (mem. op.); Mr. W. Fireworks, Inc. v. Comal Cty., No. 03-06-00638-CV,
2010 WL 1253931, at *8 (Tex. App.––Austin Mar. 31, 2010, no pet.) (mem. op.).
In addition, it is well settled in Texas that “property owners do not acquire a
constitutionally protected vested right . . . in zoning classifications once made.”
City of University Park v. Benners, 485 S.W.2d 773, 778 (Tex. 1972). The City
retains its legislative authority to re-zone at any time as public necessity demands.
City of Pharr v. Tippitt, 616 S.W.2d 173, 176 (Tex. 1981). These principles apply
to an even greater extent in the present case where the City did not rezone the
Property, but only denied Plaintiff’s request to up-zone the Property.
48
121. The Supreme Court in Lingle concluded that the substantial
advancement test is a due process inquiry and not a takings inquiry. Lingle v.
Chevron U.S.A., Inc., 544 U.S. 528, 539 (2005). For this reason, even if Plaintiffs
were to defeat the City’s immunity, standing, ripeness, and other grounds for
summary judgment, Plaintiffs could not defeat the City’s summary judgment
motion in this case, unless Plaintiffs provide evidence sufficient to create a genuine
fact issue as to whether or not the City’s denial of Plaintiffs’ upzoning request has
denied Plaintiffs all economically viable use of their property or whether the City
unreasonably interfered with their right to use and enjoy the property. A regulatory
taking is a condition of use “so onerous that its effect is tantamount to a direct
appropriation or ouster.” Lingle., 544 U.S. 528 at 537. A court in deciding a zoning
issue cannot assume the role of “super zoning board.” Mayhew at 933.
2. Subject to the foregoing objections the City carried its
summary judgment burden and Plaintiffs failed to meet
their burden to present evidence or raise question of fact
(Responds to Appellants’ Brief at pg. 14)
122. In this case, the zoning of the Property has remained semi-commercial
for fifty years, not commercial. On pages 14 and 15 of Appellants’ Brief,
Appellants attempt to equate a non-conforming use exception with effective zoning
of the Property. These two terms do not have the same meaning or effect. Zoning is
49
the use which is allowed for an area. The very term, “non-conforming use” means
that the use does not comply with the zoning of the area. A non-conforming use
exception only allows a particular use (in this case a laundromat use) to continue
for a period of time until it is abandoned. This gives landowners a chance to recoup
investment backed expectations after a zoning change, but still does not allow
other unrestricted businesses into the area in the manner that an upzoning would
allow.
123. Plaintiffs propose the City should offer proof related to the
justification of the City’s zoning decision in 1962. Any claim for that time period
would be barred by the statute of limitations.
124. Here, the undisputed facts are that the City’s 1962 zoning ordinance
established zoning for the Property as semi-commercial with nonconforming uses
of the Property to continue until a nonuse of six months occurred whereupon the
nonconforming use would cease and revert to semi-commercial zoning. Plaintiffs
cannot demonstrate that the City’s denial of the up-zoning request was anything
but a decision to advance the City’s legitimate government concern to protect
residents from the ill effects of increased traffic, parking congestion and to control
the rate and character of community growth. As a result, the City is entitled to
summary judgment on Plaintiff’s taking claim.
50
125. Without waiving the City’s position that substantial advancement of
legitimate government interest is not applicable to this analysis, the City provides
the following argument in the event the Court finds this element does apply.
126. The City Council minutes attached to Defendant’s summary judgment
motion discuss the fact that the semi-commercial zoning is a transition zone that
protects neighbors. The Texas Supreme Court has determined that there are a broad
range of governmental purposes that will satisfy the substantially advance
requirement. Id. Legitimate state interests include protecting residents from the ill
effects of traffic congestion, parking congestion, enhancing the quality of life, and
controlling the rate and character of community growth. Id. at 934. Such zoning
benefits the public and serves the City’s interest in assuring careful and orderly
development of business uses. See Agins v. City of Tiburon, 447 U.S. 255, 260
(1980); see also Lingle, 544 U.S. at 539.
127. A zoning ordinance, duly adopted is presumed to be valid, and the
burden is on the one seeking to prevent its enforcement to prove that the ordinance
is arbitrary or unreasonable. City of Fort Worth, 388 S.W.2d 400, 402 (Tex. 1964).
Further, zoning is a legislative function of municipal government. City of Pharr v.
Tippitt, 616 S.W.2d 173, 175 (Tex. 1981). The courts must give deference to a
city’s action such that, “if reasonable minds may differ as to whether or not a
particular zoning ordinance has a substantial relationship to the public health,
51
safety, morals or general welfare, no clear abuse of discretion is shown and the
ordinance must stand as a valid exercise of the city's police power.” Id. at 176.
“Courts may not interfere unless a challenged ordinance is shown to represent a
clear abuse of municipal discretion or unless there is conclusive evidence that a
zoning ordinance is arbitrary either generally or as to particular property.” Benners
at 779. A plaintiff cannot ask the Court to review the wisdom of the City’s denial
of Plaintiff’s zoning request.
128. Further, the Texas Supreme Court has stated that “We are in accord
with the principle that municipal zoning ordinances requiring the termination of
nonconforming uses under reasonable conditions are within the scope of municipal
police power; and that property owners do not acquire a constitutionally protected
vested right in property uses once commenced or in zoning classifications once
made. Benners at 778. “A nonconforming use of land or buildings is a use that
existed legally when the zoning restriction became effective and has continued to
exist.” Id
129. The City has met its burden and Plaintiff has failed to create a fact
issue.
D. Appellee Objects to Appellants’ “Issue 4” (Stripped
Economic Viability) Raised for the First Time on Appeal.
Subject thereto, Plaintiffs failed to provide evidence or raise
an issue of fact to support their argument that the City’s
zoning deprived Plaintiffs of the economically viable use of
their property or unreasonably interfered with their use of
52
the property (Responds to Appellants’ Brief at pg. 16; ref.
Issue 4)
130. In “Issue 4”, discussed in Article II, Section D, 1 and 3, and Article III
of Appellants’ Brief, Appellants have included a discussion not previously made in
their Response to Defendant’s Motion for Summary Judgment. They assert for the
first time on appeal that the center strip was stripped of all economically viable
use. Defendant objects to this argument being raised for the first time on appeal.
Although Plaintiffs mentioned in their Response to Defendant’s Motion for
Summary Judgment that this element was plead in the petition, Plaintiffs failed to
make any argument or provide any evidence related to this element in their
Response. See CR 658 to 680. Defendant requests this Court strike Appellants’
“Issue 4” and related argument at II, D, 1 and 3, and III of Appellants’ Brief.
131. Subject to the foregoing objection, Defendant has demonstrated
Plaintiffs still have economically viable uses in the form of semi-commercial uses
for the center suites in the Property and have been granted Special Use Permits
even for the specific commercial uses requested by Plaintiffs.
132. Subject to and without waiving the foregoing objection, the City
asserts Plaintiffs failed to provide any evidence in support of this argument. The
City has shown that the prior owner, Eng, allowed the non-conforming laundromat
use to be abandoned because it was not performing financially and that he believed
he could lease the Property for semi-commercial office uses. Plaintiffs have
53
admitted the City granted them Special Use permits for the uses they requested.
Plaintiff has failed to provide any evidence that the Property has been stripped of
economic viability because of any action by the City.
1. Standard for showing regulatory taking requires
more than unsupported statements that zoning regulations
unreasonably interfere with use of property and affect the
economic viability of the property; must be evidence that
unreasonable restriction (Responds to Appellants’ Brief at
pg. 16)
133. Defendant has provided evidence that the denial of the upzoning
request was not unreasonable. The denial simply maintained the status quo which
existed at the time Plaintiffs purchased the Property. There can be no reasonable
investment backed expectation to have a property’s zoning changed to commercial
after it is acquired.
134. It is undisputed the City has granted Plaintiffs Special Use Permits for
the Property. The former owner Billy Eng testified that the laundromat operated in
the middle suite under the nonconforming commercial use and his business failed.
CR 696. Mr. Eng allowed the non-conforming use to be abandoned because he
believed he could lease the suites for office space. CR 696.
135. Plaintiffs have failed to provide any evidence that they tried to utilize
the space for office space or any other use allowed under the semi-commercial
54
zoning of the Property. All Plaintiffs have offered is their personal opinions that
having the middle suite zoned commercial would somehow be more economically
viable. Plaintiff’s self-serving and unsupported statements are not summary
judgment evidence sufficient to raise an issue of fact regarding the reasonableness
of the City’s actions. There can be no genuine dispute that the City has never
denied Plaintiff full economic use of the Property. Plaintiff’s desire not to need to
apply for a new special use permit for the middle suite when he changes tenants is
not a property right to which he is entitled under the law. It is not unreasonably
restrictive for the City to require a permit to use property in a manner which would
not otherwise have been allowed in that zoning district, particularly, as here, where
the City granted the permit
136. Defendant provides the following argument subject to its objection
above. “A restriction denies the landowner all economically viable use of the
property or totally destroys the value of the property if the restriction renders the
property valueless.” Mayhew at 935. While the semi-commercial zoning
classification for the middle suite of the Property does not permit Plaintiff to lease
to certain types of businesses, there are numerous economically viable businesses
which are permitted under the existing zoning. Any number of professional offices
for doctors, lawyers, real estate professionals are permitted. The undisputed facts
here clearly demonstrate that Plaintiff acquired several barber shops and nail salons
55
who were interested in the Property and requested Special Use Permits for them.
The City approved Special Use Permits on more than one occasion at Plaintiff’s
request for barber shop/nail salon uses, but Plaintiff, although authorized, never
filled the vacancy in the middle suite of the Property.
137. It is clear that the City has not “destroyed all value of the property” by
denying the Plaintiff’s zoning request. To the contrary, the City approved the
Plaintiff’s requests for Special Use Permits on more than one occasion. Plaintiff
operates two leased business suites on the property, that of a convenient grocery
store and a bar, that remain in use. Because Plaintiff cannot demonstrate that he
has been denied all economic uses of the Property, the City is entitled to summary
judgment on Plaintiff’s takings claim.
2. The zoning had been in effect for 50 years; allowing a
property owner to continue a non-conforming use subject to
termination of the use on certain conditions does not
constitute a zoning change, but a benefit to the landowner;
no evidence was shown of an unreasonable restriction on
the property and City not required to show serving a
substantial public purpose (Responds to Appellants’ Brief
at pg. 18; ref. Issue 3)
Appellees Object to Appellants’ “Issue 3” on Substantial Public Purpose of
the City’s “Zoning” (as opposed to denial) Raised for the First Time on
Appeal and Not a Relevant Issue
56
138. Appellants’ “Issue 3” and related argument at II, D, 2 of Appellants’
Brief argues there is a regulatory taking because the City’s zoning does not
effectuate a substantial public purpose. Appellant objects to Plaintiffs raising the
issue of whether or not there is a substantial public purpose to the City’s zoning for
the first time on appeal. Plaintiffs’ Response to Defendant’s Motion for Summary
Judgment only raised the issue of whether or not the City had established a
substantial public purpose for its decision not to up-zone the Property from long-
standing “Semi-Commercial” zoning to “Commercial” zoning. CR 668 to 675.
Appellee requests Appellants’ Issue 3 and related argument at II, D, 3 of
Appellants’ Brief be stricken.
139. Subject to and without waiving the foregoing objection, Appellant
asserts the City is not required to show a substantial public purpose in order to
succeed on its summary judgment motion for an inverse condemnation claim. In its
Motion for Summary Judgment, the City relied on the Supreme Court’s statement
in the Lingle decision that there is no substantial purpose test in a regulatory
takings claim because this is a due process factor. CR 596.
140. Nonetheless, Defendant did make an argument in its Motion for
Summary Judgment related to Plaintiffs’ failure to demonstrate the denial of
zoning did not advance a substantial state interest. This argument was made subject
57
to and without waiving the City’s position that the substantial advancement test is
not a valid issue in this inverse condemnation case. CR 596 to 598.
141. On page 18 of Appellants’ Brief, Appellants again attempt to confuse
“zoning” with “non-conforming use.” The Property has been zoned semi-
commercial for over fifty years. There can be no unreasonable burden on Plaintiffs
property where the zoning has remained as it was when Plaintiffs purchased the
Property and the City has granted Special Use permits for the uses requested.
142. Subject to the foregoing objection, in the event this Court of Appeals
does consider the substantial advancement test, Defendant has demonstrated the
substantial relationship between the City’s denial of the up-zone request and a
legitimate public purpose. The semi-commercial zone is a transition zone which
protects residents of residential areas from increased traffic and parking congestion
in commercial areas and allows the City to control the rate and character of
community growth. CR 596 to 598. The City has provided evidence of a
substantial public purpose in the form of minutes of a City Council meeting at
which the up-zoning request was discussed. The discussion included statements
regarding the fact that this area is a transition zone between “Commercial” and
“Residential” zones, and that there is a residential property backing directly up to
the Property and neighboring properties which would be negatively affected by
unrestricted commercial zoning of the Property. CR 621 and 622.
58
143. Because the City has met its burden to demonstrate a substantial
public purpose, the burden shifts to Appellants to provide evidence to create a fact
question as to this element. Defendant’s evidence demonstrates a substantial public
purpose and Plaintiffs’ only alleged evidence, the Affidavit of Salim Merchant,
fails to provide any evidence sufficient to create a question of fact on whether or
not the denial of the up-zone request substantially advanced a legitimate
government interest. CR 682 to 685.
144. Merchant’s reliance on a list of businesses he claims are allowed to
operate within one mile of the Property fails to demonstrate that the City’s zoning
decision regarding the Property does not substantially advance a legitimate City
interest. A bare list of business names without providing their specific location, the
location relative to residential homes, the availability of parking spaces, the impact
on traffic, the signage, the zoning for each, and the impact on the City’s
development fails to carry Plaintiffs’ burden to prove that the 50 year old zoning
ordinance in this case is somehow arbitrary or unreasonable. At a minimum,
Merchant’s affidavit does not even substantiate the list of business names
contained in the Response. Plaintiffs do not, at a minimum, produce evidence that
the businesses listed are even located within the City of Terrell Hills. In addition,
Merchant’s personal opinion that it is arbitrary or irrational for the City’s zoning to
allow for the middle suite not to be zoned commercial when the end suites are
59
zoned commercial is inaccurate and insufficient for the Court to overturn a
presumptively valid zoning ordinance. See City of Fort Worth, 388 S.W.2d 400,
402 (Tex. 1964). There is no dispute that the underlying zoning of all of the spaces
on the Property has been “Semi-Commercial” since the 1960’s although the non-
conforming commercial uses were allowed to continue provided they were not
abandoned.
145. Determining whether the government has unreasonably interfered
with a landowner's right to use and enjoy property requires consideration of two
factors: 1) the economic impact of the regulation, and 2) the extent to which the
regulation interferes with distinct investment-backed expectations. Mayhew, 964
S.W.2d at 935. The existing zoning of the property at the time the Property is
acquired is to be considered in determining whether the regulation interferes with
investment-backed expectations. Mayhew at 937-38. The party claiming privilege
to continue a nonconforming use, in this case Plaintiff, bears the burden of proving
its preexisting status. See City of Pharr v. Pena, 853 S.W.2d 56, 63 (Tex. App.—
Corpus Christi 1993, writ denied). Here, it is undisputed that Plaintiff acquired the
Property after the nonconforming use made of the middle suite on the Property had
been abandoned by the prior owner. The abandonment of only the non-conforming
use on the center suites and not the two outer suites of the Property was a decision
60
made by the former owner, Eng, not by the City. For this reason, it cannot be
considered an arbitrary action by the City.
146. For further argument the City incorporates the City’s argument from
CR 596 to 698 herein as if set forth in full for the purpose of demonstrating that
Plaintiffs have not met their burden on this test.
3. Plaintiffs presented no evidence City’s restriction was
unreasonable, or that any City restriction or any failure to
act timely made the center space un-leasable (Responds to
Appellants’ Brief at pg. 19; ref. Issue 4)
147. Plaintiff’s assertion that the semi-commercial status makes it
impossible to lease is a completely unsupported personal opinion, especially when
Plaintiff has testified that he had several potential barbershop and hair salon
tenants for the middle suite for which the City provided Plaintiff special use
permits. The decision to leave the non-conforming uses on the end suites, not the
center one was made by former owner, Eng, not by the City. It cannot be attributed
to the City.
III. Defendant objects to Appellants issue on the character of governmental
action which was not raised by Plaintiffs in their Response to Defendant’s
summary judgment motion. Subject thereto, the summary judgment evidence
shows no zoning intransigence and there is no regulatory taking as a matter of
law (Responds to Appellants’ Brief at pg. 20; ref. Issue 4)
61
148. Defendant objects to Appellants issue on the character of
governmental action which was not raised by Plaintiffs in their Response to
Defendant’s summary judgment motion. Subject thereto, the summary judgment
evidence shows no zoning intransigence and there is no regulatory taking as a
matter of law. The character of the City’s action in this case has been demonstrated
to be a typical zoning action to preserve the status quo of having a transition zone
to protect neighboring properties. Plaintiffs have failed to raise a question of fact to
defeat summary judgment.
IV. Appellee has objected above to Appellants’ “Issue 2” (Balance Between
Public and Private Interests) Raised for First Time on Appeal and Not a
Relevant Issue (Responds to Appellants’ Brief at pg. 21; ref. Issue 2)
149. Already above - Appellants’ “Issue 2” argues there is a fact issue
regarding how the City’s regulation affects the balance between the public interest
and that of the private landowner. See Appellants’ Brief at pg. x. Defendant objects
to Plaintiff raising this argument for the first time on appeal. Plaintiffs failed to
raise this issue in their response to Defendant’s Motion for Summary Judgment.
See CR 658 to 680. Defendant requests that this Court of Appeals strike “Issue 2”
and related argument at II, C and IV from Appellants’ Brief. Subject to and
without waiving the foregoing objection Defendant asserts this issue is not material
62
to the summary judgment issues because it is not one of the elements of Plaintiffs’
cause of action for inverse condemnation or of the City’s defenses.
150. Subject to the foregoing objection, in the event the Court does look to
the balancing test, Defendant asserts there is nothing to balance because Plaintiffs
have failed to provide evidence of burdens to them which could outweigh the
public interest demonstrated by Defendant of having a transition zone, protecting
neighbors from traffic congestion and parking issues, and providing for orderly
development of the City. A question of fact as to a non-material issue will not
defeat a summary judgment motion. The Trial Court’s Judgment should be upheld.
V. CONCLUSION
151. As shown above Plaintiffs/Appellants have failed to show any
evidence to support at least one of the elements of their cause of action,
alternatively, have failed to show waiver of immunity and otherwise establish
jurisdiction, and, alternatively, have failed to raise a question of material fact as to
the elements of their causes of action. Plaintiffs simply bought a piece of property
without researching its zoning and tried to make the public pay for their mistake.
The City’s actions in denying an upzoning merely maintained the long-standing
semi-commercial zoning of the Property. Plaintiffs’ self-serving statements that he
has been denied all use of the property simply don’t hold weight given that the City
has granted Special Use Permits for the uses requested by Plaintiffs. For the
63
reasons cited above Defendant/Appellee asserts the judgment of the District Court
granting Defendant’s Summary Judgment should be upheld.
PRAYER
WHEREFORE, PREMISES CONSIDERED, Defendant/Appellee, City
of Terrell Hills, prays this Court of Appeals finds the final judgment of the District
Court in favor of the City of Terrell Hills’ Motion for Summary Judgment should
stand and enters a decision upholding the decision of the District Court and order
that Plaintiffs take nothing, and for such other and further relief, both general and
special, at law and in equity, to which the Defendant/Appellee may show itself to
be justly entitled.
Respectfully submitted,
/s/ Barbara L. Quirk
Barbara L. Quirk
State Bar No. 16436750
MCKAMIE KRUEGER, LLP
941 Proton Road
San Antonio, Texas 78258
210.546.2122
210.546.2130 (Fax)
barbara@mckamiekrueger.com
Adolfo Ruiz
State Bar No. 17385600
64
MCKAMIE KRUEGER, LLP
941 Proton Road
San Antonio, Texas 78258
210.546.2122
210.546.2130 (Fax)
adolfo@mckamiekrueger.com
ATTORNEYS FOR APPELLEE,
CITY OF TERRELL HILLS
65
CERTIFICATE OF SERVICE
As required by Texas Rule of Appellate Procedure 6.3 and 9.5(b), (d), (e),
I certify that I have served the foregoing Appellee’s Brief on all other parties
which are listed below by e-filing on September 25, 2017 as follows:
R. Carlo Garcia
OLIVA, SAKS, GARCIA & CURIEL
14255 Blanco Road
San Antonio, Texas 78216
(210) 308-6600
(210) 308-6939 (fax)
cglaw@osgclaw.com
Jeff Small
LAW OFFICE OF JEFF SMALL
12451 Starcrest Drive, Suite 100
San Antonio, Texas 78216-2988
(210) 496-0611
(210) 579.-399 (fax)
jdslaw@satx.rr.com
Attorneys for Appellants Electro Sales and Service
And Salim Merchant
/s/ Barbara L. Quirk
Barbara L. Quirk
66
CERTIFICATE OF COMPLIANCE
I certify that this document is in compliance with Tex. R. App. P. 9.4 (e) and (i). It
contains 14,993(LESS THAN 15,000) words excluding the exempted parts of the
document. The body text is in 14 point font, and the footnote text is in 12 point
font.
/s/ Barbara L. Quirk
Barbara L. Quirk
September 25, 2017
Date
67
__________________________________________________________________
APPENDIX
__________________________________________________________________
TO THE HONORABLE JUDGE OF SAID COURT:
The following exhibits are incorporated by reference into the Appellee City of
Terrell Hills’ Brief:
A. City of Terrell Hill’s Motion for Summary Judgment filed August 16, 2016
B. City of Terrell Hill’s Reply to Plaintiff’s Response to Defendant’s Motion
for Summary Judgment filed September 28, 2016
C. Clerk’s Record Excerpt pp. 621 – 622 City Council Minutes
C-2. Clerk’s Record Excerpt p. 628 City Council Minutes
D. Clerk’s Record Excerpt pp. 636 – 639 Ordinances 1349 and 1386 granting
Special Use Permits to Plaintiff
D-2. Clerk’s Record Excerpt pp. 646 – 648 Section XV of the City of Terrell
Hills Zoning Ordinance, Board of Adjustment Procedures
E. Sheffield Dev. Co. v. City of Glenn Heights, 140 S.W.3d 660
E-2. Tex. Loc. Gov’t Code Section 211.010 Appeal to Board of Adjustment
68
EXHIBIT A
FILED
8/16/2016 12:25:00 PM
Donna Kay McKinney
Bexar County District Clerk
Accepted By: Marissa Ugarte
CAUSE NO. 2013-CI-00447
SALIM MERCHANT & ELECTRO § IN THE DISTRICT COURT
SALES AND SERVICES, INC., §
Plaintiff, §
§
v. § 57th JUDICIAL DISTRICT
§
THE CITY OF TERRELL HILLS AND §
BILLY W. ENG AND GIN WEI ENG, §
Defendants. § BEXAR COUNTY, TEXAS
CITY OF TERRELL HILLS’ MOTION FOR SUMMARY JUDGMENT
TO THE HONORABLE JUDGE OF SAID COURT:
COMES NOW the City of Terrell Hills, Texas (hereinafter the “City”), Defendant in the
above-entitled and numbered cause, and files this Motion for Summary Judgment and in support
thereof, would respectfully show the Court as follows:
I. BACKGROUND
1. This case began with the purchase by Plaintiff 1 on June 7, 2011, of 2111 to 2117 Harry
Wurzbach (“the Property”), located in the City of Terrell Hills from Billy W. Eng and Gin Wei
Eng (“the Eng Defendants”). The lawsuit arose from Plaintiff’s own failure to investigate the semi-
commercial zoning status of the property prior to purchasing the property, his misconception
regarding the abandonment by the previous owner of one of the commercial uses which had existed
previously on the property, and his subsequent efforts to force the City to change the zoning of the
property from semi-commercial to commercial in a manner not consistent with the City’s plans for
the area.
1
Plaintiff’s Original Petition names two plaintiff entities, Salim Merchant and Electro Sales and Services Inc., but
defines them as one “Plaintiff.” The City will likewise refer to both named plaintiff entities as a singular Plaintiff.
1
581
EXHIBIT A
2. Plaintiff’s misconceptions about the City’s ordinances are not relevant against the City. A
landowner has no right to a change in zoning in cases such as this and the City is entitled to
judgment as a matter of law dismissing all claims against the City in this lawsuit.
3. On January 10, 2013, Plaintiff filed this case against the Eng Defendants and the City.
Plaintiff’s primary case against the Eng Defendants can be summarized as alleged
misrepresentations in the sales transaction. As Plaintiff states on page 3 of Plaintiff’s Original
Petition (the “Petition”), Plaintiff alleges he was unaware of the semi-commercial (rather than
commercial) zoning of the Property prior to the purchase. Plaintiff states he was also unaware the
Engs had abandoned one of the non-conforming commercial uses previously operated at the
middle suite on the Property. 2 Plaintiff’s lack of knowledge does not create any duty on the City’s
part to give him the zoning he wants for the Property.
4. Plaintiff’s case against the City asserts a regulatory taking 3 without adequate compensation
having been made in violation of Section 17 of Article I of the Constitution of the State of Texas.
In the Petition Plaintiff disagrees with the City’s interpretation of its non-conforming use ordinance
prior to his purchase of the Property related to the cessation of one of the commercial
nonconforming uses which had been abandoned by the previous owner. The discontinuance of this
non-conforming use occurred before Plaintiff’s purchase of the Property and Plaintiff has no
standing for claims against the City related to this matter. Plaintiff further challenges the City’s
denial in October of 2012 of his request to up-zone the Property from semi-commercial to
commercial. Further, despite the fact that the City created a special use permit for the purpose of
2
The City’s Zoning Ordinance provides that a non-conforming use will be lost if the use is discontinued for six
months. In this case, the other non-conforming commercial uses on the Property purchased by Plaintiff which had not
been abandoned by the previous owner continue to this day.
3
In the fact section of the Petition on page 4 Plaintiff states the interpretation of the ordinance is regulatory
condemnation, and the enforcement of the ordinance is regulatory taking. However, the causes of action portion of
the pleading only asserts regulatory taking.
2
582
EXHIBIT A
allowing Plaintiff to use the middle suite location for the use he requested, Plaintiff complains of
the City’s interpretation of its zoning ordinance as not permitting a barber shop use in a semi-
commercial zoning district (without the special use permit) and asserts he should not be required
to make a new request for a special use permit whenever his tenant changes. See the Petition at
pages 3 and 4.
5. Plaintiff also seeks a judicial declaration as to the City’s interpretation of specific ordinance
provisions relating to permitted uses of the Property. It is difficult to interpret Plaintiff’s meaning
in the declarations language, but the overall intent of the declarations sought appears to be: 1)
whether Section VIII of the City’s comprehensive zoning ordinance (“Zoning Code”) forbids the
placement of a barbershop in the suite in question; 2) whether Section X of the City’s Zoning Code
allows one non-conforming use at a particular address in a larger tract to cease while other non-
conforming uses at different addresses in the same building continue; and 3) whether the City’s
Zoning Code prevents Plaintiff from placing a service-oriented business in the suite in question.
6. Pursuant to Texas Rules of Civil Procedure 166a(c) and 166a(i) the City requests summary
judgment in favor of the City on all of Plaintiff’s claims against the City.
II. SUMMARY OF THE ARGUMENT
7. The City is entitled to summary judgment on the following grounds:
a. Plaintiff cannot overcome the City’s assertion of immunity from this suit where
Plaintiff has not plead a viable regulatory takings claim. Plaintiff’s allegations do not set forth the
taking of any property right and no waiver of immunity is triggered. There was no taking, in part
because there is no property right in a zoning change for property from semi-commercial to
commercial. There also can be no taking where the City granted Plaintiff’s request for a special
use permit for the suite in question. Plaintiff also cannot establish standing to sue.
3
583
EXHIBIT A
b. Plaintiff is barred as a matter of law from litigating a regulatory takings claim based
on 1) the cessation of the nonconforming use in the middle suite of the Property and 2) the denial
of a barber shop in a semi-commercial district because he failed to exhaust his administrative
remedies to appeal those administrative enforcement decisions to the Board of Adjustment.
c. Plaintiff is barred as a matter of law from pursuing his claims because of lack of
ripeness.
d. Plaintiff cannot demonstrate that the City’s denial to up-zone the Property
constitutes a regulatory taking because 1) it substantially advances legitimate City interests; 2) it
does not deny Plaintiff all economically viable uses of the Property; 3) it does not unreasonably
interfere with Plaintiff’s right to use and enjoy the Property. There is no genuine issue of material
fact to defeat summary judgment for the City on these issues.
e. Plaintiff’s declaratory judgment action is an impermissibly duplication of his
takings claims for purposes of obtaining attorney’s fees.
f. Alternatively, Plaintiff has provided no evidence of the material elements of his
claims; that a property right was taken by the City; that he was deprived of any economically viable
use of the Property or of any investment backed expectations; or that any action of the City was
the proximate cause of any damages to him.
8. In addition, the City is entitled to summary judgment on Plaintiff’s claim for declaratory
judgment where the claim impermissibly duplicates the issues already before the trial court. In
addition, because Plaintiff’s claim for declaratory judgment is based on administrative decisions
relating to the cessation of the nonconforming use of the middle suite of the Property and the denial
of a barber shop use in a semi-commercial district, Plaintiff is barred from litigating those decisions
because he failed to exhaust his administrative remedies to the Board of Adjustment. Because there
4
584
EXHIBIT A
is no viable basis for the declaratory judgment action, Plaintiff’s claim is an improper request for
judicial opinion and is nothing more than a veiled request for attorney’s fees. Furthermore, because
Plaintiff cannot overcome the City’s assertion of immunity to the regulatory takings claim, the
request for declaratory relief will not resolve a live controversy as to the rights of the parties. The
City is entitled to judgment as a matter of law on all of Plaintiff’s claims against the City.
9. Alternatively, the City is entitled to judgment as a matter of law because Plaintiff has
provided no evidence to support his claims against the City. An adequate time for discovery has
passed since this suit was filed. Written discovery and depositions of Plaintiff and Co-Defendant
Mr. Eng have occurred. Plaintiff has produced no evidence of a taking of a property right, whether
it be because he allegedly has been denied all economically viable uses of the suite in question, or
that any action of the City unreasonably interfered with Plaintiff’s right to use and enjoy the
Property. In fact, Plaintiff admits on page 5 of the Petition that the City passed a special use permit
provision which would allow him to rent the middle suite as a barber shop. Plaintiff could not
claim he has been denied any reasonable investment backed expectations because the zoning status
of which he complains existed prior to his purchase of the Property. It would not be reasonable for
a purchaser of property to have expectations of uses in a zoning classification which do not apply
to the property at the time of the purchase. Further, Plaintiff has produced no evidence of any
damages he sustained which were proximately caused by any action on the City’s part.
10. Plaintiff has provided no evidence to support his takings claim against the City and has
provided no genuine issue of material fact to defeat summary judgment. The City is entitled to
judgment on all of Plaintiff’s claims against the City as a matter of law.
5
585
EXHIBIT A
III. SUMMARY JUDGMENT FACTS
11. All averments in the paragraphs above are incorporated herein as if set forth in full.
12. Defendant, City of Terrell Hills is a Home Rule municipality, organized, operating and
existing under Art. 11, Sec. 5, Constitution of the State of Texas.
13. Since the mid-1960s the zoning for the property located at 2111-2117 Harry Wurzbach
within the City of Terrell Hills (hereinafter “Property”) was semi-commercial. See Exhibit 1 –
Excerpts of Billy Eng’s Deposition, page 28:9-11; 33:12-17.
14. From 1962 to 2011, the previous owners of the Property continuously maintained three
separately leased suites of business on the Property. See Exhibit 1 – Excerpts of Billy Eng’s
Deposition, page 18:4-25; 19:1-21; 20:4-8.
15. Prior to Plaintiff buying the Property, the middle suite of the Property became vacant for
over six months and lost its grandfathered non-conforming commercial use status. See Exhibit 1
– Excerpts of Billy Eng’s Deposition, page 65:14-18.
16. The previous owner of the Property, the Eng Defendants, prior to selling the Property,
intended to let the grandfathered non-conforming use status lapse and follow the zoning rules
regarding the use of the middle suite as an office space. See Exhibit 1 – Excerpts of Billy Eng’s
Deposition, page 94:18-25; 95:1-18. He felt confident there were sufficient uses available to him
to lease the suite. See Exhibit 1 – Excerpts of Billy Eng’s Deposition, page 94:21; 95:10.
17. On June 7, 2011, Plaintiff purchased the Property. See Plaintiff’s Original Petition, page 3.
18. On June 13, 2011, Plaintiff applied to the City of Terrell Hills Planning and Zoning
Commission (“Zoning Commission”) to rezone the Property from semi-commercial to
commercial. See Exhibit 2 – Plaintiff’s June 13, 2011 Plaintiff’s Application for Rezoning.
6
586
EXHIBIT A
19. On August 8, 2011, the Terrell Hills City Council (“City Council”) held a public hearing
on Plaintiff’s application for rezoning. Following the conclusion of the public hearing, the City
Council denied the application for rezoning. See Exhibit 3 – City Records, August 8, 2011 City
Council Minutes Denying Rezoning.
20. On July 10, 2012, Plaintiff through his attorney, applied to the Zoning Commission to re-
zone the middle suite of the Property for a Cricket Communication store. See Exhibit 4 – July 10,
2012 Plaintiff’s Application for Rezoning Middle Space for Cricket.
21. On or about October 1, 2012, the City Council, following public hearing, denied the
application to rezone the middle suite of the Property. See Exhibit 3 – City Records, October 1,
2012 City Council Denial of Rezoning.
22. On December 10, 2012, the City Council adopted Ordinance 1347, amending the Zoning
Code adding Section VIII, Section D by providing for a Special Use Permit in the Semi-
Commercial Zoning District that will allow certain uses in more restrictive districts under special
conditions of design with the approval of the Planning and Zoning Commission and the City
Council. See Exhibit 3 – City Records, December 10, 2012 Ordinance 1347 Creating Special Use
Permit. 4
23. On December 12, 2012, Plaintiff applied to the Zoning Commission for a Special Use
Permit for the middle suite of the Property to be used as a Barber Shop and Beauty Parlor. See
Exhibit 5 – December 12, 2012 Plaintiff’s Application for Special Use Permit Hair Salon.
24. On or about January 10, 2013, Plaintiff filed a lawsuit against the Eng Defendants and the
City in Cause No. 2013-CI-00447, in the 57th Judicial District Court of Bexar County, Texas. The
Petition stated causes of action against the City for a Regulatory Taking and Declaratory Judgment.
4
The City requests that the Court take judicial notice of all of the provisions of the City’s Zoning Code relied upon
herein.
7
587
EXHIBIT A
25. On May 13, 2013, the City Council accepted and approved the site plan for the Property
located at 2115 Harry Wurzbach, Terrell Hills and passed Ordinance 1349 approving a Special
Use Permit for 2115 Harry Wurzbach, the suite at issue in this lawsuit, for use as a hair and nail
salon. See Exhibit 3 – May 13, 2013 Ordinance 1349 Approving Special Use Permit Hair Salon.
Under Section 2 (f) of Ordinance 1349, the Special Use Permit zoning classification will expire
six (6) months after the Property is no longer used for at least one (1) of the Permitted Uses. Id.
26. Plaintiff failed to open the hair and nail salon before the May 2013 Special Use Permit had
expired. As a result, Plaintiff again requested that the Zoning Commission grant a Special Use
Permit for a barber shop as soon as possible. See Exhibit 6 – February 5, 2014, Plaintiff’s
Application for Special Use Permit Hair Salon.
27. On April 13, 2015, the City Council again approved a site plan for the Property located at
2115 Harry Wurzbach, Terrell Hills, and adopted Ordinance 1386 approving a Special Use Permit
for 2115 Harry Wurzbach, the suite at issue in this lawsuit, for use as a hair and nail salon. See
Exhibit 3 – City Records, April 13, 2015, Ordinance 1386 Approving Special Use Permit Hair
Salon. Under Section 2 (f) of Ordinance 1386, the Special Use Permit zoning classification will
expire six (6) months after the Property is no longer used for at least one (1) of the Permitted Uses.
Id.
28. Even though authorized to do so, Plaintiff never used the middle suite located at 2115 Harry
Wurzbach on the Property for a permitted use allowed under the Specific Use Permits within six
months of being granted by the Zoning Commission and the City.
IV. SUMMARY JUDGMENT EVIDENCE
29. The City relies upon the following undisputed summary judgment evidence either on file
with the Court or appended to this motion:
8
588
EXHIBIT A
Exhibit 1 – Excerpts of Billy Eng’s Deposition
Exhibit 2 – Plaintiff’s June 13, 2011 Plaintiff’s Application for Rezoning Property
Exhibit 3 – City of Terrell Hills’ Records, including: August 8, 2011 City Council Minutes;
October 1, 2012 City Council Minutes; December 10, 2012 Ordinance 1347; May 13, 2013
Ordinance 1349; April 13, 2015 Ordinance 1386
Exhibit 4 – July 10, 2012 Plaintiff’s Application for Rezoning Middle Space for Cricket
Exhibit 5 – December 12, 2012 Plaintiff’s Application for Special Use Permit Hair Salon
Exhibit 6 – February 5, 2014 Plaintiff’s Application for Special Use Permit Hair Salon
Exhibit 7 – City of Terrell Hills Comprehensive Zoning Ordinance, Chapter 14
V. SUMMARY JUDGMENT STANDARDS
30. Tex. R. Civ. P. 166a(c) sets forth the standard for traditional summary judgment. The
movant for summary judgment has the burden of showing there is no genuine issue of material
fact and is entitled to summary judgment as a matter of law. Nixon v. Mr. Property Management,
690 S.W.2d 546, 548-49 (Tex. 1985). In deciding whether there is an issue of material fact,
evidence favorable to the non-movant will be taken as true and every reasonable inference indulged
in its favor. Id. Once the movant establishes the right to judgment as a matter of law, the burden
shifts to the non-movant who must then set forth sufficient evidence to create an issue of material
fact in order to avoid summary judgment. See City of Houston v. Clear Creek Basin Auth., 589
S.W.2d 671, 678 (Tex. 1979).
31. Tex. R. Civ. P. 166a(i) sets forth the standard for a no-evidence summary judgment. After
adequate time for discovery, a movant may move for summary judgment without evidence on the
ground that there is no evidence of one or more essential elements of a claim or defense on which
the non-movant has the burden at trial. The burden shifts to the non-movant to present evidence
raising an issue of material fact. The no-evidence motion for summary judgment should be granted
9
589
EXHIBIT A
when there is a complete absence of evidence of a vital fact. King Ranch Inc. v. Chapman, 118
S.W.3d 742, 751 (Tex. 2003).
VI. ARGUMENT
32. All assertions in the foregoing paragraphs are incorporated into this Article as if set forth
in full herein.
33. The City is entitled to summary judgment because no genuine issue of material fact exists
as to any element of Plaintiff’s claims against the City and the City is entitled to judgment as a
matter of law.
A. Immunity and Lack of Standing
34. All relevant assertions stated elsewhere in this Motion are incorporated into this section as
if set forth in full herein.
35. The City, as a municipal government, is entitled to governmental immunity from a suit for
money damages unless its immunity has been waived. City of Houston v. Carlson, 451 S.W.3d
828, 830 (Tex. 2014). Without this waiver, courts have no jurisdiction to adjudicate any claim
against the City. See id. It is Plaintiff’s burden to establish the City’s consent to be sued through a
waiver of immunity. Id. Because Plaintiff cannot demonstrate a viable regulatory takings claim as
discussed further below, the City retains its immunity. See Hearts Bluff Game Ranch, Inc. v. State,
381 S.W.3d 468, 476 (Tex. 2012). As a result, the City is entitled to dismissal of Plaintiff’s claims
against the City.
36. Further, Plaintiff has no standing to raise a takings claim against the City. The regulatory
zoning classification of which Plaintiff complains was put in place many years prior to Plaintiff’s
purchase of the Property. The discontinuance of the non-conforming use in question occurred prior
to Plaintiff’s purchase of the Property. Since Plaintiff purchased the Property, the City has not
10
590
EXHIBIT A
taken any action to restrict Plaintiff’s ability to use the Property. Instead the City has increased
Plaintiff’s ability to use the Property by allowing for a special use permit for the use Plaintiff
requested.
B. Failure to Exhaust Administrative Remedies
37. All relevant assertions stated elsewhere in this Motion are incorporated in this section as if
set forth in full.
38. Plaintiff bases his takings claim and declaratory judgment claim in large measure on the
City staff’s interpretation and enforcement of the zoning ordinances, specifically that prior to
Plaintiff’s ownership of the Property the nonconforming use in the middle suite on the Property
ceased, and that a barber shop was not an allowable use in the middle suite after the cessation of
the nonconforming use and its reversion back to semi-commercial zoning. However, there is no
evidence that Plaintiff timely appealed these administrative decisions to the Board of Adjustment
as required by Section XV of the City’s Zoning Code.
39. Federal case law provides that a takings claim is not ripe until (1) the relevant governmental
unit has reached a final decision as to what will be done with the property and (2) the plaintiff has
sought compensation through whatever adequate procedures the state provides. See Sandy Creek
Investors, Ltd. v. City of Jonestown, 325 F.3d 623, 626 (5th Cir. 2003); Williamson County Reg’l
Planning Comm’n v. Hamilton Bank, 473 U.S. 172, 194-95 (1985); Hidden Oaks Ltd. v. The City
of Austin, 138 F.3d 1036, 1041 (5th Cir. 1998); Samaad v. City of Dallas, 940 F.2d 925, 933-34
(5th Cir. 1991). This law is applicable to the present case with respect to the first element, that the
relevant governmental unit must have reached a final decision as to what will be done with the
property before a plaintiff may pursue a takings claim. In the present case, Plaintiff failed to appeal
the decisions of staff for a decision by the Board of Adjustment. As a result of Plaintiff’s failure
11
591
EXHIBIT A
to exhaust his administrative remedies, the Plaintiff is barred from litigating these administrative
decisions, and the City is entitled to summary judgment on his takings claim and request for
declaratory judgment based on those decisions.
40. In the present case, challenges to a zoning decision of an administrative official or staff
personnel should first have been brought to the Board of Adjustment. See TEX. LOC. GOV’T
CODE § 211.009(a). A Board of Adjustment may hear and decide an appeal that alleges error in
an order, requirement, decision, or determination made by an administrative official in the
enforcement of this subchapter. TEX. LOC. GOV’T CODE § 211.009(a)(1). A person aggrieved
by the decision of an administrative official or any officer, department, board or bureau of the
municipality may appeal. TX. LOC. GOV’T CODE § 211.010(b). The appellant must file with the
Board of Adjustment and the official from whom the appeal is taken a notice of appeal specifying
the grounds for the appeal within a reasonable time as determined by the rules of the board. TEX.
LOC. GOV’T CODE § 211.010(b). The City has created a Board of Adjustment pursuant to this
statutory authority.
41. Under Chapter 14, Section XV of the Zoning Code, appeals to the Board of Adjustment
may be taken by any person aggrieved or by any officer, department, board or bureau of the
municipality affected by any decision of the administrative officer. See Exhibit 7 – Zoning Code,
Ch. 14 Sec. XV (2)(b)(1). Chapter 14 of the Zoning Code further defines what a “reasonable time”
is for the purposes of appealing a decision of a City administrative officer to the Terrell Hills Board
of Adjustment. Id. Such appeal shall be taken with ten (10) days from the date of any such ruling,
by filing with the officer from whom the appeal is taken and with the Board of Adjustment a notice
of appeal specifying the grounds thereof. Id.
12
592
EXHIBIT A
42. Here, Plaintiff failed to obtain a final ruling from the City through the appellate process set
out in TEX. LOC. GOV’T CODE § 211.010(b) and the Zoning Code, Ch. 14 Sec. XV (2)(b)(1).
Plaintiff’s failure to timely appeal the decisions of the City staff in compliance with the City’s
appellate process bars Plaintiff from litigating both the decision relating to the cessation of the
nonconforming use for the middle suite of the Property and the decision that the barber shop was
not an allowed semi-commercial use in the middle suite. As a result, the City is entitled to dismissal
of Plaintiff’s claims related to these decisions.
C. Ripeness
43. All relevant assertions made elsewhere in this Motion are incorporated in this section as if
set forth in full.
44. Ripeness is an element of subject matter jurisdiction. State Bar of Texas v. Gomez, 891
S.W.2d 243, 245 (Tex. 1994). As such, ripeness is a legal question. Texas Ass'n of Business v.
Texas Air Control Bd., 852 S.W.2d 440, 444-45 (Tex. 1993). A takings claim is not ripe for court
action until a final decision about what level of use will be permitted on the property. See
Williamson Planning Comm’n at 173; see also Public Util. Comm’n v. Houston Lighting & Power
Co., 748 S.W.2d 439 (Tex. 1987)(“A court has no jurisdiction to render an advisory opinion on a
controversy that is not yet ripe.”). “[T]he ripeness doctrine conserves judicial time and resources
for real and current controversies, rather than abstract, hypothetical, or remote disputes. Browning-
Ferris, Inc. v. Brazoria County, 742 S.W.2d 43, 49 (Tex. App.--Austin 1987, no writ). In order for
a regulatory takings claim to be ripe, there must be a final decision regarding the application of the
regulations to the property at issue. Hamilton Bank at 186. A “final decision” usually requires both
a rejected development plan and the denial of any variances from the controlling regulations. Id.
at 187-88.
13
593
EXHIBIT A
45. Here, to the extent that Plaintiff’s regulatory taking claim is based on the use of the middle
suite of the Property, the undisputed facts clearly demonstrate that the City granted Plaintiff’s
applications for a Special Use Permit allowing additional permitted uses for the Property, including
a barber shop/hair salon. Plaintiff cannot demonstrate that the City ever shut its door to continued
future uses for the middle suite of the Property. Plaintiff specifically requested to put a barber shop
in the middle suite on the Property, and the City granted a Special Use Permit for that use. Since
the possibility remains open that Plaintiff’s requested uses would be permitted on the Property by
the City, a jury could not reach a decision on whether the Property had been “taken.” The
application history makes it clear that the City is allowing the uses of the Property as requested by
Plaintiff. The existing zoning of the middle suite of the Property when Plaintiff acquired the
Property was semi-commercial, and the City is allowing Plaintiff uses greater than the stated semi-
commercial zoning for the Property. It would be premature to request a court or jury to make a
determination whether a compensable taking has occurred under such circumstances when the
undisputed facts demonstrate that the City is likely to continue approving uses for the Property
above the stated semi-commercial zoning for the Property. As such, Plaintiff’s claim is premature,
and the City is entitled to summary judgment on the claims against them.
D. City Entitled to Judgment as Matter of Law on Regulatory Takings Claim
46. All relevant assertions made elsewhere in this Motion are incorporated in this section D
and its subparts as if set forth herein.
47. Plaintiff’s petition alleges that the City’s decisions related to his Property constitute a
regulatory taking without adequate compensation having been made, in violation of Section 17 of
Article I of the Constitution of the State of Texas. The decisions discussed in the factual summary
in the Petition include: the cessation of the previous nonconforming use on the middle suite of the
14
594
EXHIBIT A
Property prior to Plaintiff’s purchase of the property; a denial to up-zone the Property from semi-
commercial to commercial; staff’s interpretation that a barber shop/salon was not an allowable use
in a semi-commercial zone; and the City’s requirement for Special Use Permits for uses
determined not to be allowed in the zone.
48. The Texas Constitution provides, in pertinent part, that no “person’s property shall be
taken, damaged or destroyed for or applied to public use without adequate compensation being
made....” Tex. Const. art. I, § 17.
49. Generally, a property owner has no vested right to use its property in a certain way without
restriction. See Azadpour v. City of Grapevine, No. 02-13-00323- CV, 2014 WL 2566024, at *4
(Tex. App.––Fort Worth June 5, 2014, pet. denied) (mem. op.); Mr. W. Fireworks, Inc. v. Comal
Cty., No. 03-06-00638-CV, 2010 WL 1253931, at *8 (Tex. App.––Austin Mar. 31, 2010, no pet.)
(mem. op.). In addition, it is well settled in Texas that “property owners do not acquire a
constitutionally protected vested right . . . in zoning classifications once made.” City of University
Park v. Benners, 485 S.W.2d 773, 778 (Tex. 1972). The City retains its legislative authority to re-
zone at any time as public necessity demands. City of Pharr v. Tippitt, 616 S.W.2d 173, 176 (Tex.
1981). These principles apply to an even greater extent in the present case where the City did not
rezone the Property, but only denied Plaintiff’s request to up-zone the Property.
50. In order to succeed on a compensatory regulatory takings claim, Plaintiff must demonstrate
that a zoning regulation (1) does not substantially advance a legitimate state interest, (2) denies the
landowner of all economically viable use of their property, or (3) unreasonably interferes with a
landowners’ rights to use and enjoy their property. Mayhew v. Town of Sunnyvale, 964 S.W.2d
922, 932-33, 935 (Tex. 1998)(citing Lucas v. South Carolina Coastal Council, 505 U.S. 1003,
1015-19 & n.8 (1992)); see also Agins v. City of Tiburon, 447 U.S. 255, 260 (1980) and Lingle v.
15
595
EXHIBIT A
Chevron U.S.A., Inc., 544 U.S. 528, 539 (2005). Because the Supreme Court in Lingle concluded
that the substantial advancement test is a due process inquiry and not a takings inquiry, the City
asserts in this case Plaintiff would need to demonstrate either that he has been denied all
economically viable use of his property or that the City unreasonably interfered with his right to
use and enjoy the property. A regulatory taking is a condition of use “so onerous that its effect is
tantamount to a direct appropriation or ouster.” Id. at 537. (citation omitted). A court in deciding
a zoning issue cannot assume the role of “super zoning board.” Mayhew at 933. Whether a zoning
ordinance constitutes a compensable taking is a question of law, not fact. Id.
1. City Entitled to Judgment as Matter of Law because Plaintiff Cannot
Demonstrate City’s Zoning Decisions Do Not Substantially Advance
Legitimate Government Interests.
51. Without waiving the City’s position that substantial advancement of legitimate government
interest is not applicable to this analysis, the City provides the following argument in the event the
Court finds this element does apply.
52. Plaintiff cannot demonstrate that the City’s zoning decisions regarding the Property do not
substantially advance a legitimate City interest.
53. The substantial advancement requirement to demonstrate a regulatory takings claim looks
at the nexus between the effect of the ordinance and the legitimate state interest it is supposed to
advance. Mayhew at 934. “The standard requires that the ordinance ‘substantially advance’ the
legitimate state interest sought to be achieved rather than merely analyzing whether the
government could rationally have decided that the measure achieved a legitimate objective. Id.
Moreover, the “wisdom of the [City’s] decision” is not under review. Id. The Court must only be
concerned with whether the decision satisfies constitutional standards. The Texas Supreme Court
has determined that there are a broad range of governmental purposes that will satisfy the
16
596
EXHIBIT A
substantially advance requirement. Id. Legitimate state interests include protecting residents from
the ill effects of traffic congestion, parking congestion, enhancing the quality of life, and
controlling the rate and character of community growth. Id. at 934. Such zoning benefits the public
and serves the City’s interest in assuring careful and orderly development of business uses. See
Agins v. City of Tiburon, 447 U.S. 255, 260 (1980); see also Lingle, 544 U.S. at 539.
54. A zoning ordinance, duly adopted is presumed to be valid, and the burden is on the one
seeking to prevent its enforcement to prove that the ordinance is arbitrary or unreasonable. City of
Fort Worth, 388 S.W.2d 400, 402 (Tex. 1964). Further, zoning is a legislative function of
municipal government. City of Pharr v. Tippitt, 616 S.W.2d 173, 175 (Tex. 1981). The courts must
give deference to a city’s action such that, “if reasonable minds may differ as to whether or not a
particular zoning ordinance has a substantial relationship to the public health, safety, morals or
general welfare, no clear abuse of discretion is shown and the ordinance must stand as a valid
exercise of the city's police power.” Id. at 176. “Courts may not interfere unless a challenged
ordinance is shown to represent a clear abuse of municipal discretion or unless there is conclusive
evidence that a zoning ordinance is arbitrary either generally or as to particular property.” Benners
at 779. A plaintiff cannot ask the Court to review the wisdom of the City’s denial of Plaintiff’s
zoning request.
55. Further, the Texas Supreme Court has stated that “We are in accord with the principle that
municipal zoning ordinances requiring the termination of nonconforming uses under reasonable
conditions are within the scope of municipal police power; and that property owners do not acquire
a constitutionally protected vested right in property uses once commenced or in zoning
classifications once made. Benners at 778. “A nonconforming use of land or buildings is a use that
existed legally when the zoning restriction became effective and has continued to exist.” Id.
17
597
EXHIBIT A
56. Here, the undisputed facts are that the City’s 1962 zoning ordinance established zoning for
the Property as semi-commercial with nonconforming uses of the Property to continue until a
nonuse of six months occurred whereupon the nonconforming use would cease and revert to semi-
commercial zoning. See Exhibit 1 – Excerpts of Billy Eng’s Deposition, page 28:9-11; 33:12-17.
In addition, at the time that Plaintiff acquired this Property, the nonconforming use of the Property
had ceased on the middle suite and reverted to a semi-commercial use. See the Petition at pages 3
and 4. Almost 40 years after the semi-commercial zoning was assigned, Plaintiff requested an up-
zoning of the Property to commercial. See Exhibit 2 – June 13, 2011 Plaintiff’s Application for
Rezoning. Plaintiff cannot demonstrate that the City’s denial of the up-zoning request was
anything but a decision to advance the City’s legitimate government concern to protect residents
from the ill effects of increased traffic, parking congestion and to control the rate and character of
community growth. As a result, the City is entitled to summary judgment on Plaintiff’s taking
claim.
2. The City is Entitled to Summary Judgment because Plaintiff has Not Been
Denied All Economic Uses of the Property.
57. Plaintiff alleges the City’s zoning decisions constitute a “taking.” However, the undisputed
evidence clearly demonstrates Plaintiff has not been denied all economically viable uses of the
middle address suite or of the Property as a whole. Plaintiff has been allowed to continue non-
conforming uses in all suites on the Property except the middle suite for which the non-conforming
use had previously been discontinued. Plaintiff was provided a special use permit for the middle
suite on the Property so that Plaintiff could rent that suite for the use Plaintiff requested. Thus,
there can be no genuine dispute that the City has never denied Plaintiff full economic use of the
Property. Plaintiff’s desire not to need to apply for a new special use permit for the middle suite
when he changes tenants is not a property right to which he is entitled under the law. It is not
18
598
EXHIBIT A
unreasonably restrictive for the City to require a permit to use property in a manner which would
not otherwise have been allowed in that zoning district, particularly, as here, where the City granted
the permit.
58. “A restriction denies the landowner all economically viable use of the property or totally
destroys the value of the property if the restriction renders the property valueless.” Mayhew at
935. While the semi-commercial zoning classification for the middle suite of the Property does not
permit Plaintiff to lease to certain types of businesses, there are numerous economically viable
businesses which are permitted under the existing zoning. Any number of professional offices for
doctors, lawyers, real estate professionals are permitted. The undisputed facts here clearly
demonstrate that Plaintiff acquired several barber shops and nail salons who were interested in the
Property and requested Special Use Permits for them. The City approved Special Use Permits on
more than one occasion at Plaintiff’s request for barber shop/nail salon uses, but Plaintiff, although
authorized, never filled the vacancy in the middle suite of the Property. See, Exhibit 3 – City
Records, December 10, 2012 Ordinance 1347 Creating Special Use Permit and May 13, 2013
Ordinance 1349 Approving Special Use Permit Hair Salon.
59. It would appear from Plaintiff’s allegations and actions that Plaintiff is only interested in
having the Property rezoned from semi-commercial to commercial. He is essentially asserting that
commercial uses are the only economically viable uses of the Property and anything less than the
City changing the zoning classification would deny the only economically viable uses of his
Property and constitute a constitutional taking. Such an argument fails to satisfy the standard for
demonstrating a constitutional taking. The former owner, Defendant Billy Eng, testified that he
was intending, after the nonconforming use ceased, to put a business office in the middle suite in
conformity with the semi-commercial zoning. See Exhibit 1 – Excerpts of Billy Eng’s Deposition,
19
599
EXHIBIT A
page 94:18-25; 95:1-18. He felt confident there were sufficient uses available to him to lease the
suite. See Exhibit 1 – Excerpts of Billy Eng’s Deposition, page 94:21-25; 95:1-10.
60. It is clear that the City has not “destroyed all value of the property” by denying the
Plaintiff’s zoning request. To the contrary, the City approved the Plaintiff’s requests for Special
Use Permits on more than one occasion. Plaintiff operates two leased business suites on the
property, that of a convenient grocery store and a bar, that remain in use. Because Plaintiff cannot
demonstrate that he has been denied all economic uses of the Property, the City is entitled to
summary judgment on Plaintiff’s takings claim.
3. The City Did Not Unreasonably Interfere with Plaintiff’s Right to Use and
Enjoy Property.
61. Determining whether the government has unreasonably interfered with a landowner's right
to use and enjoy property requires consideration of two factors: 1) the economic impact of the
regulation, and 2) the extent to which the regulation interferes with distinct investment-backed
expectations. Hearts Bluff Game Ranch, 381 S.W.3d at 476; Mayhew, 964 S.W.2d at 935 (citing
Lucas, 505 U.S. at 1019, n. 8, 112 S. Ct. 2886; Penn Cent. Transp. Co., 438 U.S. at 124, 98 S. Ct.
2646). In the present case Plaintiff will be unable to demonstrate that the City’s zoning decisions
have interfered with Plaintiff’s right to use and enjoy his property when the zoning on the Property
has remained semi-commercial for many years prior to Plaintiff’s ownership of the Property and
the previous nonconforming use of the middle suite of the Property had been discontinued before
Plaintiff ever acquired the Property.
62. The existing zoning of the property at the time the Property is acquired is to be considered
in determining whether the regulation interferes with investment-backed expectations. Mayhew at
937-38. The party claiming privilege to continue a nonconforming use, in this case Plaintiff, bears
the burden of proving its preexisting status. See City of Pharr v. Pena, 853 S.W.2d 56, 63 (Tex.
20
600
EXHIBIT A
App.—Corpus Christi 1993, writ denied). Here, it is undisputed that Plaintiff acquired the Property
after the nonconforming use made of the middle suite on the Property had ceased and the use of
that suite had reverted back to semi-commercial use. The facts are undisputed that the Eng
Defendants allowed the middle suite to remain vacant for longer than six months. Pursuant to the
City’s zoning ordinance, when a use is discontinued, it loses its special use status and reverts back
to the established zoning of the Property, in this case, semi-commercial. The previous owner, Mr.
Eng, understood that the non-conforming use ceased prior to Plaintiff purchasing the Property due
to the vacancy of the middle suite for over six months. See Exhibit 1 – Excerpts of Billy Eng’s
Deposition, page 65:14-18. As a result, at the time of the sale to Plaintiff in 2011, the lawful use
of the middle suite was limited to semi-commercial uses based on the 1962 zoning ordinance
classifications. Once the non-conforming use had been abandoned, Plaintiff’s request after he
purchased the property to expand the use of the middle suite beyond semi-commercial purposes
was not consistent with the semi-commercial zoning of the Property. Because the nonconforming
use had ceased prior to Plaintiff acquiring the Property, Plaintiff cannot demonstrate that he had a
reasonable investment-backed expectation to a discontinued nonconforming use in the middle suite
of the Property and cannot demonstrate that the City unreasonably interfered with Plaintiff’s right
to use and enjoy the Property by denying his zoning request.
63. To the extent Plaintiff is complaining that the procedural requirement for a Special Use
Permit is “so onerous that its effect is tantamount to a direct appropriation or ouster,” Plaintiff
cannot demonstrate that such a procedural requirement somehow constitutes a regulatory taking
in Texas. Essentially, Plaintiff does not wish to follow the City’s process for application for a
Special Use Permit if there is a change in tenant for the middle suite of the Property. Plaintiff
cannot demonstrate that requiring a Special Use Permit somehow interferes with his right to enjoy
21
601
EXHIBIT A
the Property, especially, where the City has granted his several requests for Special Use Permits.
As a result, the City is entitled to summary judgment on Plaintiff’s takings claim against them.
E. Declaratory Judgment
64. Plaintiff seeks declaratory judgment and to recover attorney’s fees under the Uniform
Declaratory Judgments Act (the “Act”). See Tex. Civ. Prac. & Rem. Code § 37.003. Plaintiff
requests declarations as to: 1) whether Section VIII of the City’s Zoning Code allows the use of a
barbershop in a semi-commercial zoning district; 2) whether Section X of the City’s Zoning Code
allows the non-conforming use at one suite in a larger tract to be discontinued when other non-
conforming uses at other suites in the same building on the Property continue to operate; and 3)
whether the City’s Zoning Code prevents Plaintiff from placing a service-oriented business in the
middle suite of the Property.
65. A party cannot use the Act to obtain an otherwise impermissible attorney’s fee. MBM Fin.
Corp. v. Woodlands Operating Co., 292 S.W.3d 660, 669 (Tex. 2009). The Act provides that a
person whose rights, status, or other legal relations are affected by a statute or ordinance “may
have determined any question of construction or validity arising under” the statute or ordinance
and obtain a declaration of his rights, status, or other legal relations thereunder. Tex. Civ. Prac. &
Rem. Code § 37.004(a). The Act waives governmental immunity against claims that a statute or
ordinance is invalid. City of El Paso v. Heinrich, 284 S.W.3d 366, 373 n.6 (Tex. 2009). However,
it does not waive immunity against claims seeking a declaration of the claimant’s statutory rights.
Tex. Dep't of Transp. v. Sefzik, 355 S.W.3d 618, 621 (Tex. 2011)(per curiam). When declaratory
relief would resolve a controversy as to the rights and status of the parties, a trial court may award
relief under the Act when deciding cases “already within [its] jurisdiction.” Chenault v. Phillips,
914 S.W.2d 140, 141 (Tex. 1996). However, relief should not be awarded where the declaratory
22
602
EXHIBIT A
action has no greater ramifications than a plaintiff’s cause of action for a compensable taking and
is merely duplicating the issues already before the trial court. See City of Carrollton v. RIHR Inc.,
308 S.W.3d 444, 2010 (Tex. App. Dallas 2010).
66. Here, other than attorney’s fees, Plaintiff is seeking no relief under the declaratory
judgment pleading not associated with its cause of action alleging a compensable taking. The
Plaintiff’s declaratory action claims are subsumed within its cause of action for the regulatory
taking, i.e., the legitimate right of the City to regulate the uses on the Property, the legitimate right
of the City to allow nonconforming uses to cease on the Property, and the legitimate right of the
City to disallow a use that does not meet the zoning ordinance requirements and the City’s plans.
In addition, as stated above, Plaintiff is barred from litigating the staff decisions on nonconforming
use and the barber shop use because he did not timely appeal those decisions to the Board of
Adjustment as required by the Zoning Code. Moreover, the City has permitted the special use of a
barber shop to Plaintiff in the middle suite of the Property on more than one occasion. As such,
Plaintiff’s use of the Act is really an improper vehicle for obtaining attorney’s fees.
67. Furthermore, as stated in the regulatory takings section above, the City is entitled to
summary judgment on immunity grounds on Plaintiff’s taking claim. Because Plaintiff has failed
to overcome the City’s assertion of immunity, the request for declaratory relief would not resolve
a controversy as to the rights of the parties. As a result, the City is entitled to summary judgment
and all of Plaintiff’s requests for declaratory relief should be dismissed.
F. No Evidence
68. Alternatively, Plaintiff has provided no evidence of the material elements of his claims
despite the fact that ample time for discovery has passed. As discussed above, to establish a takings
claim Plaintiff must demonstrate that a property right was taken by the City. He has provided no
23
603
EXHIBIT A
evidence of the taking of any zoning use from him since the time of his purchase of the Property.
Further, Plaintiff has failed to provide any evidence of either of the two elements discussed above
from Mayhew and Lindle: that the City regulation either (1) denies the landowner of all
economically viable use of their property, or (2) unreasonably interferes with a landowners’ rights
to use and enjoy their property. The latter can be shown by denial of reasonable investment backed
expectations. However, Plaintiff cannot show that he was deprived of all economically viable use
of the Property because he was granted a special use permit by the City. Further, Plaintiff has failed
to provide any evidence of any legitimate investment backed expectations which were taken.
Plaintiff would be unable to produce such evidence because there could be reasonable expectation
of use of the Property for zoning which did not exist at the time of his purchase.
69. Proximate cause is an essential element of a takings case. “[W]ithout causation, there is no
‘taking.’” Tarrant Reg'l Water Dist. v. Gragg, 43 S.W.3d 609, 615 (Tex.App.—Waco 2001),
aff'd,151 S.W.3d 546 (Tex.2004). Plaintiff has failed to produce any evidence that any action of
the City proximately caused damages to Plaintiff.
G. Texas Business and Commerce Code, Chapter 27
70. Plaintiff generally alleges a violation of Chapter 27 of the Texas Business and Commerce
Code against all defendants. However, the original petition does not allege any factual references
against the City under the Texas Business and Commerce Code. The only factual references relate
to the real estate transaction and contract, none of which include any actions by the City. To the
extent Plaintiff is alleging some claim against the City under the Texas Business and Commerce
Code, the City is entitled for summary judgment on immunity grounds.
VII. CONCLUSION
The summary judgment evidence shows there is no genuine issue of material fact on
Plaintiff’s claims against the City and the City is entitled to judgment as a matter of law on all of
24
604
EXHIBIT A
Plaintiff’s claims against the City. Alternatively, Plaintiff has provided no evidence to support the
main elements of his cause of action against the City, that there was a taking of a property right.
Plaintiff has failed to provide any evidence that he has no economically viable use of the Property
in question in this lawsuit or even that any action of the City unreasonably interfered with his use
of the Property. In fact, the City granted Plaintiff’s request for a special use permit so that he could
rent out the suite in question for the use he requested. Further, Plaintiff’s request for declaratory
judgment is an impermissibly duplicitous claim designed only for the purpose of seeking attorney’s
fees. Plaintiff has failed to establish any grounds for proceeding against the City and the City is
entitled to summary judgment on all of Plaintiff’s claims against the City.
WHEREFORE, PREMISES CONSIDERED, Defendant City of Terrell Hills prays this
Court grant its Motion for Summary Judgment and dismiss all claims against it, that Plaintiffs,
Salim Merchant and Electro Sales and Services, Inc. take nothing by their suit against the City,
and that the City have and recover such other relief, both general and specific, at law or in equity,
to which the City may be justly entitled.
Respectfully submitted,
MCKAMIE KRUEGER, LLP
941 Proton Road
San Antonio, Texas 78258
(210) 546-2122
(210) 546-2130 Fax
/s/: Barbara L. Quirk
WILLIAM M. McKAMIE
State Bar No. 13686800
mick@mckamiekrueger.com
BARBARA L. QUIRK
State Bar No. 16436750
barbara@mckamiekrueger.com
25
605
EXHIBIT A
ADOLFO RUIZ
State Bar No. 17385600
adolfo@mckamiekrueger.com
SUE ANN GREGORY
State Bar No. 00795392
sue@mckamiekrueger.com
ATTORNEYS FOR DEFENDANT CITY
OF TERRELL HILLS
26
606
EXHIBIT A
STATE 0 F TEXAS §
COUNTY OF BEXAR §
VERIFICATION
Before me, the undersigned authority, on this day, personally appeared Sue Ann Gregory,
known to me, who upon being duly sworn by me, affirmed, "I certify that each of the exhibits
attached to this Motion are true copies of the originals or of documents provided by Plaintiff or
the Eng Defendants in this proceeding."
La~
Sue Ann Grego~~ _
. __,... {..(._
SUBSCRIBED AND SWORN BEFORE ME on _Aug· /':::J --- ,2016.
v!ft.e.-k ~~C~-n,J
BRENDA HEIMANN
My Notary ID# 130419536
Expires January 29, 2020 Notary Public of the State of Texas
27
607
EXHIBIT A
CAUSE NO. 2013-CI-00447
SALIM MERCHANT & ELECTRO § IN THE DISTRICT COURT
SALES AND SERVICES, INC., §
Plaintiff, §
§
v. § 57th JUDICIAL DISTRICT
§
THE CITY OF TERRELL HILLS AND §
BILLY W. ENG AND GIN WEI ENG, §
Defendants. § BEXAR COUNTY, TEXAS
FIAT
Hearing on the above Defendant City of Terrell Hills’ Motion for Summary Judgment is
hereby set for hearing on the 6TH y offSEPTEMBER
______ day 8:30 A_.m. in the
______________,, 2016, at _________
Presiding District Court m1
urt of Bexar County, Room1.09
09
_____.
___________________________________
______
_______________________
_______________________________
PRESIDING JUDGE
28
608
EXHIBIT A
CERTIFICATE OF SERVICE
I certify that a true and correct copy of City of Terrell Hills’ Motion for Summary
Judgment was served according to the Texas Rules of Civil Procedure on all counsel of record in
the manner specified below on August 16, 2016 as follows:
Carlo Garcia Via E-Serve
OLIVA, SAKS, GARCIA AND CURIEL, LLP
14255 Blanco Road
San Antonio, Texas 78216
Fax: 210.308.6939
cglaw@osglaw.com
Jay Moritz Via E-Serve
THE LAW OFFICES OF JAY MORITZ
2600 SW Military Drive, Suite 118
San Antonio, Texas 78224
Fax: 210.928.9118
JayLaw5@aol.com
/s/: Barbara L. Quirk
Barbara L. Quirk
29
609
EXHIBIT A
Page 1
CAUSE NO. 2013-CI-00447
SALIM MERCHANT AND ELECTRO * IN THE DISTRICT COURT
SALES & SERVICE, INC . *
*
vs. * BEXAR COUNTY , TEXAS
*
THE CITY OF TERRELL HILLS , *
BILLY W. ENG AND GIN WEI ENG * 57TH JUDICIAL DISTRICT
ORAL DEPOSITION OF BILLY W. ENG
JUNE 22, 2016
ORAL DEPOSITION of BILLY W. ENG, produced as a witness
at the instance of the Plaintiffs, and duly sworn , was taken in
the above - styled and numbered cause on June 22, 2016, from
9 : 49 a .m. to 12:00 p . m., before Darlene Zueh l, Certified
Shorthand Reporter in and for the State of Texas, reported by
method of machine shorthand, at the Law Off i ces of Oliva Saks
Garcia & Curiel, LLP, 14255 Blanco Road, San Antonio, Bexar
County, Texas, pursuant to the Texas Rules of Civil Procedure and
the provisions stated on the record or attached hereto.
* * * * * *
SAN ANTONIO COURT REPORTING, FIRM NO. 175
555 E. BASSE ROAD, SUITE 205
610 EXHIBIT 1
EXHIBIT A
3DJH 3DJH
 ZKHQ\RXDFTXLUHGWKHSURSHUW\DW\RXUPRWKHU
VGHDWKLQ
 WKDW\RXZHUHWKDWLWZDVEHLQJRSHUDWHGDVDEDU+RZORQJ
   HYHQEHIRUHWKDWFDQ\RXUHFDOOWKDWLWZDVRSHUDWLQJDVDEDU"
 $6LQFHWKHVZKHQP\IDWKHUERXJKWLW
   42ND\$QG,GRQ
WEHOLHYH,DVNHG\RXWKLVTXHVWLRQ
 ZLWKUHVSHFWWRWKHJURFHU\VWRUH+RZORQJGR\RXUHFDOOHYHQ
 SULRUWR\RXUDFTXLULQJWKHSURSHUW\WKDWZDVEHLQJRSHUDWHG
   DVDFRQYHQLHQFHVWRUH"
 $6LQFHP\IDWKHUDFTXLUHGLW
   42ND\/HW
VWDONDERXWWKHPLGGOHVSDFH$WWKH
   WLPHWKDW\RXVROGWKHSURSHUW\DQGZKHQ,VD\\RX,
P
   JRLQJWRUHIHUWR\RXDQG\RXUEURWKHURIFRXUVHRZQHGLWEXW
 DWWKHWLPHWKDW\RXDQG\RXUEURWKHURZQHGWKLVSURSHUW\DQG
   VROGLWWR0U0HUFKDQWWKDWSURSHUW\ZDVYDFDQWLVWKDW
   FRUUHFW"
   $7KDW
VFRUUHFW
   42ND\*RLQJEDFNWRZKHQ\RXDFTXLUHGWKDWSURSHUW\LQ
   KRZZDVWKDWVSDFHEHLQJRSHUDWHG"
   $$VD/DXQGURPDWRUGU\FOHDQLQJ
 42ND\'R\RXUHFDOOWKHQDPHRIWKH/DXQGURPDW"
 $7HUUHOO+LOOV&OHDQHUV
 
 
   
 
3DJH 3DJH
 
 
   
 42ND\6RWKDWSURSHUW\DOZD\VUHPDLQHGRFFXSLHGVLQFH  4$QGKRZORQJWR\RXUNQRZOHGJHGLGWKDWVSDFHRSHUDWH
 \RXDFTXLUHGLW7KDW
V/HW
VPRYHWRWKHIXUWKHVWVSDFH  DVD/DXQGURPDWSULRUWR\RXDFTXLULQJLWLQ"
 EHLQJWKHEDU+DUU\:XU]EDFK:KHQ\RXDFTXLUHGWKDWLQ  $3UHWW\PXFKDOOWKHZD\WKURXJK,WKLQNZHEHFDPH
 KRZZDVEHLQJRSHUDWHG"  YDFDQWD\HDU,
PQRWH[DFWO\VXUHRIWKHWLPHOLQHEXW,
 $$VDEDU  WKLQNLWZDVYDFDQWIRUPD\EHVHYHQPRQWKVWRD\HDU
 42ND\$QG,
OODVN\RXWKHVDPHTXHVWLRQ'LGLWHYHU  
 EHFRPHYDFDQWGXULQJWKHWLPHWKDW\RX
YHRZQHGLWVLQFH\RXVROG
 LWWRXSXQWLOWKHWLPH\RXVROGLWWR0U0HUFKDQW"  
 $1R  
 4+DYHWHQDQWVDFWXDOO\FKDQJHGLQWHUPVRIZKRWKH
 DFWXDORZQHU
 $2ZQHUVKLS"
 4·824 -7401
F/\X 210-A22 -2197
1-.L-~
617 EXHIBIT 2
EXHIBIT A
CUSTODIAN OF RECORDS AFFIDAVIT
CITY OF TERRELL HILLS
STATEOFTEXAS §
§
COUNTY OF BEXAR §
Records pertaining to: CITY OF TERRELL HILLS
Before me, the undersigned, personally appeared COLUMBUS STUTES, who is by me
duly, deposed as follows:
I, the undersigned, am over 18 years of age, competent to make this affidavit, and am
personally acquainted with the facts herein stated.
I am the CUSTODIAN OF RECORDS for:
THE CITY OF TERRELL HILLS
Attached hereto are 21 pages of records. These said records are kept by the CITY OF
TERRELL HILLS in the regular course of business. It is the regular course of business for
employees to make these records, with the knowledge of the act or event, and the records are
made at or near the time or reasonably soon thereafter. The records are true and correct copies of
the original documents on file with the CITY OF TERRELL HILLS.
COLUMBUS STUTES, Secretary-Manager
CITY OF TERRELL HILLS
SUBSCRIBED AND SWORN to before me by the said COLUMBUS STUTES on the 15th day
of August, 2016 to certify which witness my d and seal of office.
,~,uuu ,
11
/~,~~·'·~~..; \ AMY M 8UCKERT Y PUBLIC IN AND FOR THE
~: ::...,1~·:': ~ Norory Pub11c. State or Texas STAT FTEXAS
~~ · l~ ' •"$"Com m E~p 1res l 1-04 · 201Y
Expires:~ ~. 2t::l\Cj'
-..,.;
,, ~...
.,. ..
,t:·+ ,...
,,,,,,,,,,,,•' No ta ry JD 1304 3 J 98-7
My Commission
618 EXHIBIT 3
EXHIBIT A
CITY OF TERRELL HILLS
MINUTES OF TllE REGULAR CITY COUNCIL MEETING
AUGUST 8. 2011
AGENDA
!. Call lo Order and RecordingofQuonnn
2. Rcvlcw/aclion of Minutes oJ'1heJu1y 11. 2011 regular Council Meeting..
J. Employee of' the Quaner
4. Public Ilea.ring on the requesl from Mr. Salim Merchan1 for the rezoning of the property
located at 2115 J ISJTy Wurzbach Road from semi-commercial to commercial 1.1.ming.
5. Discussion/Action on the request from Mr. Salim Mercl1am for 1he rezoning of 1he
property located at 2 11 5 Harry Wurzbach Road from semi-commercial Lo commercial
1.oning
6. Discussion/ Action approving the spcc ifi c~tions for the 20 I I Bond Road projects and
authorizing lb!.! bid process.
7 Discussion/Action authorizing the disrmsal of surplus equipmenl
8. Discussion I Action on requesl for Special Activity Pern1il for the Texas Campaign for the
Env[rcmmenl to conduct a door-to-door canvass ofTerl'ell Hills on September 7. 2011 .
9. Oniinance~ and Resolutioni;
a. Resolution fl 1324 A Resolution approving the relocation of an easemenl
granted to San Antonjo Water System (SAWS) by the City of Terrell Hills alld
setting an effective dale.
iO. Reports
u. Chy Manager Report: General Fund. Debt Service and Capital Funds reports. Update
on the Ad Valorem Tax Rolls.
h Deputy Fire Chiefs' Report: Recent Fire Department Activity
c. Police Chief Report: Reccnl Activity
11 . Comments hy citizens
619
EXHIBIT 3
EXHIBIT A
11 Adjoummcnl
CALL TO ORDER ANO RECORDING OF QUORUM
Mayor Camp declared a quorum present and called lhc regular Council meeting to order
at 5'.00 p.m. at City Hall. 5100 North New Braunfels Avenue. on August 8. 201 I
fherc were present.
Ma}or .I Bradford Camp
Mayor Pro lem Michelle Brady
Ct.tuncilmember Wilham Ochse. IJl
Councilmcmhcr Anne Rallantyne
Cmmcilmember Charles Parish.. Jr
Also present were:
Interim City Manager. Columhus Stutes
Police Chief, Greg Whitlock
Deputy Fire Chief. William Knupp
Deputy Fire Chief. Justin Seibr.::rt
Fxecutive S1;:crctary, Kristine Sanchell'
City t\ttomcy, hank Garza
Buddy & Kay Rosene. 348 Ulac Lane
Salim Merchant. 2111 I-tarry Wurzhach
John Colquhoun. Preese & Nichols
Richard Kelley, Freese & Nichols
Mr & Mrs. James Flagg, 1433 Wiltshire
David Balmer. 347 Garra1y
Mr. & Mrs. George Ryan. 1437 Wiltshire
Halma Siemek. 139 Brykcr
Ross l'a:ylor 140 Bryker
IU:VIEW/ACTIO~ OF MTNl'TES OF THE JUI,\ 11. 201J REGULAR COUNCIL
\1FF-TING
Upon motiun hy Couocilmembcr Ballantynl!. and second hy Mayor Pro tern Brady. the
minutes of the July I I. 201 t regular Council Meeung were unanimously approved.
EMPLOYEE OF THE QUARTER
Mayor Camp rccogmLed Alan Swanson a> Lmployce of the Quarter. for the second
qunrter of 2011. Deputy Chief Seiher1 spoke orFirdightcr Swanson's accomplishments over the
Inst quar1cr stating lhal he had completed bis paramedic classes with an t\ average. played a
2
620
EXHIBIT 3
EXHIBIT A
significant role in the oew computer generated Pre-Pluns for the department. and continued hi'>
duties with his shift.
PUBLIC HEARING ON THE REQUEST FROM MR. SALIM MERCHANT FOR THE
REZONING OF TllE PROPERTY LOCATED AT 211 5 llARRY WURZBACH ROAD
FROM SEMI-COMMERCIAL TO COMMERCIAL ZONrNG
Mayor Camp opened the public hearing al 5:05 pm on Mr. Merchant's requesl. The City
Manager explained that this request had been submitted lo the Planning and Zoning Cnmmission
and rhe recommendation of the commission was against the request for re-zotU.ng. The property
in question is localed between the Fort Sam Grocery W1d Ebbt1de Lounge.
Mr Merchant addressed Council explaining that when he purchased the properly he
though1 the entire su·ip was commercial and U1at without the re-2oning he cannot lease !lie
property as he had intended and in addiuon this will decrease the property value. Mr. Merchant
said that he has a similar property on Eisenhauer which is all commercial. There is a spnns har,
convi:aience store as well as his office localed there and he ht1s encountered ao problems with
the neighbors during U1e past ten years.
Mr. Flagg spoke to Council saying that Lherc was a reason the pr•operties had heen re-
zorn:d. I he Laundroma1 that was located there previously hlls been closed for more than six
momhs and 1herefore is zoned semi-commercial and it should be kepi 1111s way. l le said he
agreed with the recommeudatiou of the P&Z Commjss100.
Mrs. Ryan said that her concern is tha1 once the property is zoned commercial there will
be no way of controlling what type of business opens there. She said she believed Mr.
Merchant's intentions were good but tltal does not mean iI he sells the property the new owner,s
would be. She explained 1ha1 their property backs directly up 10 that one and they have had
problems over the years with disturbances from the " drunks and derelicts" tha1 hang out in 1he
parking lot. Mr. Ryan agreed slating that at one time it was such a problem lhcy requested and
received a variance to put in a higher fence.
Couucilmembe1 Ocl1se verified with I.he City Manager that all of those p1-operties rue
zoned semi-commercial; the store and bar are grandfathered in because they were in existence
prior to the re-zoning The City Manager confirmed this saying they are not z.oned commercial
Councilmember Ochse asked what types of businesses WL"f'C allowe BY THE CITY OF
TERRELL RILLS AND SETTING AN EFFECTIVE DATE
'J be City Manager said this easement is required as part of the City I tall Renovalio11.
Mayor Pro tem Brady rnade the motion. whic11 was seconded by Councilmember Ballantyne lo
approve Resolution# 1324. All vored in favor and the motion passed.
CITY MANAGER REPORTS
The City Maniiger reponed that the budget is right where it should be for this Lime of
year. He said that expenses are 85% of budget and mcome il> 100% of budget. The combined
cash on hand is$ I 1-357,468 and all departments are operating within iheir bi1dgets. The Capital
outlays al this point are minimal, but will begin to increa-;e as the projects progress.
The ad valorem tax rate shows a 1.8% reduction in valuations. This means that in order to
set tl1e effective la~ rel.le to bnng in the same collections we would have to incrt:ase taxes by .02;
however staff bas found savings iu ol.ber areas uflhe budget to avoid a 1ax increase.
DEPUTY FIRE CHIEFS' REPORTS
Deput) ChiefSeiben reported that the department responded 10 51 calls in July. most of
which were emergency medical calls. There were no fire calls and response Lime is gooublic Ai.:cess Educational Governmental
Programming. Many smaller cities have opted 10 reject this paymen1 becnuse t11e cost of
'> UCh programming 1s greater than the PEG Fee received Time Warner Cable has said
1hat cities thnt pass the resolution before the end ol 1he year will not be required to return
the 1% and 111 addi1ion this will reduce the rcs1dcnt"s hill b, 1his 1%. Upon motion bv
5
630
EXHIBIT 3
EXHIBIT A
Councilmernber Ballantyne and second by Councilmcmbcr Ochsc, Council unanimously
voted to pass Resolution# 1343.
CITY MANAGER REPORTS
Mr. Stutes reported that the fund balance has shown a significant decrease
because of large paymenL'l on lhe City Hall and Street projects. The budget is perfomung
as 11 should. TI1e Capital PmjecLc; Fund shows both the City Hall and Street Projects have
paid $1 IM in expenses Lo date.
The Street projec1 is progressing. all of the signs have been collected that were
lefi on Newbury by the cont.rc1ctor. The work on Geneseo will move to the other sjde of
lhe esplanade within the nex1 v.edc Mayor Camp menuoncd that he has seen some
failure ut the comer of Fldon and I errcll arid 1J1c City Manager said Slaff is aware and is
in the process or revie\\.ing the engineers resting log.
POLICE CHIEF REPORTS
Chief Whitlock said tbat during National Night Out their were two
neighborhood gatherings: one in the 1200 block of Wiltshire and one in the 800 block of
1 errcll. Police and Fire personnel attended and spent some time mingling with Lhe
residents. fhe Fall Festival at St. David. s will take place on the 19111 of October and Lhe
PD will attend this as well.
Chief said lhat property crimes are very low; I 1. Foley 1s 1n Quantico and Sgt.
Baham is workmg C1D
FIRE CHIEF REPORTS
Chief Knupp reported 47 incidcnls for lhc rnonlh of September and response
tune was 1 min and 6 seconds. He said rha1 at National Night Out the FD had a Fire
fatinguisht.'T Demo and it was a hit with the residents. The Alamo Area Chiefs
Association has formed a comnuuee to dt.>vl!lop a "'best prJctaces·· which is similar k'
what the PO JUSt did, and Chief Knupp said he will be serving. on that committee. Shift
Officers allcndcd a symposium on October .i1h put on by the LA rirc County Department.
Tbe officer!. said it went Vt!T) .... cu and was very cJucalional.
ADJOURNMENT
TI11o:rc being no funber businc.-ss, Mayor Camp adjourned the meeting at 4:59 p.m.
AIJGLL~*-
SEC'RFTARY-MANAGER
631 6 EXHIBIT 3
EXHIBIT A
ORDINANCE NO. 1347
AN ORDINANCE
AMENDING THE CITY CODE O F ORDINANCES CHAPTER
14, AOOfNG SECTION Viti, SECTION (D) BY PROVIDING
FOR A SPECIAL USE PERMIT tN THE SEMI-COMMERCIAL
DIST RICT THAT WILL ALLOW CERTAlN USES IN MORE
RESTRJCTIVE DISTRICTS UNDER SPECIAL CONDITIONS
O F DESIGN, OPERATION AND APPE ARANCE AFTER
RECOMMENDATION BY THE PLANNING AND ZONING
COMMISSION AND AJ'PROVAL HY THE CITY COUNCIL;
PROVIDlNG FOR SEVERABILITY; PROVIDING AN
E FFECTIVE DATE; AND REPEALING ANY 0RD1NANCE IN
CONFLICT.
WllEREAS, the City of Terrell I !ills has u Laning Ordinance to comply with its comprehensive
plan which his designed to promote heaJtb and the general welfare. provide adequate light and
air. and prevent overcrowding~ and; and
WHEREAS, the City ofTerrell Hills Planning und Loning Commission held a public hcaring on
December 3, 2012 to gather public inp ut on providing for Special Use Permits in the Semi-
Commercial Zoning uode( special conditions of design, operation and appearance and may be
pe1111itted when specifically authorized by this section afrcr recommendation by the Planning and
Loning commission and approval by the City Council.
NOW, Tl:IEllEFOIU.:, BE IT ORDAINED {lY TRE CITY COUNCTL O F THF. CITY OF
TERRELL HILLS, T EXAS:
Section l. The City of Terrell Hills Code of Ordinances. Chapter 14 Zoning, Section Vil I.
Zone Distric1 B. Semi-Commercial District is amended to includt! Section D a'> follows:
D. Special Use Permit (SUP): Certain uses are considered appropriate in Distm;l B, Scmi-
Commercia1 District under special conditions of design. opera1ion and appearance and may be
permitted \Vh.en specifically authorized by this section after recommendation by the Planning and
Zoning Commission and approval by the City Council. Such special use pennits may be granted
in order tha~ lhe City muy develop in accordance with the intent and purpose or this chapter. that
land may be fully utilized for a lawful purpose and that substantial justice may be done.
In reaching a decision 011 any application for a special use pcnnil, I.he City shall
determine:
(a) That lhe requested special use permit will establish only thal further 1hc intent and
or
purpose this chapter.
(b) Thal the loi;ation of proposed activities and improvements are clearly defined on a
site plan filed by 1he applicant.
(c) That tbt: special use pennit will be wholly compatible with the use cmd permrtted
development of adjacent properties either as tiled or subject to such requirements a!>
Lhe city council may find necessary lo protect and maintain the st:Jbilily of adjacent
properties. The city council may also detennine co11dilions 10 be met (o meet the
intent of this chapter. They may include hours of operation.
(d) Granting of the special use permit will not adversely atTec1 the character and
appropriate use of the area or neighborhood in which it is proposed to locate; will
not substantially depreciate the value of adjacent and nearby properties for use in
accordanee with the regulations of the Semi-Commercial district in which they are
located~ will be io keeping with the spirit and intent of this chapter; will not
adversely affect the impJementaLion of the tomprehensiw plan~ and will not
adversely affect traffic. public utilities, public health, public safety, am.l the general
632
EXHIBIT 3
EXHIBIT A
welfare.
(e) No special use permh for the \!Se of buildings or lands shall bt: approvt:tl unLil a site
plan has been submitted and recommended by the planning and zoning commission
and approved by the city council. The site plan may be submitlcd concurrently with
the special use pcnnit applic:'ltion or separately following the initial recommendation
and approval
2. Special Use Permit Application. SUP Application sball be submitted 10 the City
with the proposed site plan and th.: same fees required for zoning changes. A site
pl~ with detail as required below must he submitted upon application for a
rezoning for an SUP. The site plnu shall be prepared to scale. Such rcquirnd site
plans shall show, al a rnimmum. lhe following:
(a) The location of the building or buildings to be constructed or altL"Tcd;
(b) All parking, loading, and driveways to be constnacted or altered:
(c) The location and dimensious of all screening devices. lighting equipment,
exterior located equipmc!nl such as cooling systems, trash containers, s igns. fire
hydrants, and sidewalks,
(d) The location 81ld details or all landscaping and planl malerials t<' be installed;
(e) Elevaticms and floor plans of Lhe buildings showing materials, treatments ol'
exteriors, location of balconies, overhangs, and paLio>; aml
(f) Such other details of Lbe development as the Commission and/or may deem
necessary to evaluate the impact of the development on adjoining and surrounding
properlii:s.
3. Procedures. Granting of an SUP as considered zoning and as such, all the procedures for
changing a zoning dist.rict apply to an appticalion for W1 SUP and shall be processed in
the same manner.
(a) Approval or an SUP by Lhe City Council shall be evidenced by an ortli.nancc which
shall include all special requirements lo be included in the SUI?, and all agreements
or other docurnenlS between the City and the applicant shall be incorporated in the
orctinance by reforence.
(b) If aJJ apµltcation is approved and an SUP is granted, all condilions which may have
been attached to 1.he approval are biadi.ng on tbe property and shall be complied wi.th
before a Certificate l)f Occupancy may be issued. All subsequent development and
use, as shown and described i11 Lhe approved SUP. or the property, shall be in
1:Lccordancc with the appruvcd plan and conditions.
(c) Any proposed amendment shall be approved in the same manner and under the same
procedures as are applicable to the issuance of the original pernut.
4. Rcvocatfoo of rcrmil. The SUP may be considered for revocation for, bu1 not limited
to, the following re-asons:
(a) A use other than the use approved in the SUP or in tbe underlying t.on.ing district is
developed.
(b) Construction fa nor begun wilhin one year of the date of approval of the permir.
(c) Failure to satisfy the condi1ions of tht! SUP or follow the site plan made part or tht:
SUP. The City Manager or dcsignee shall have the right to periodically examine the
operation of the special use to detennine compliance with the requirements and any
conditions. If the City Manager or dcsignee dctennmes I.hat the requirements have
not been met, or the conditions are being violated, a written notice shall be issued to
the owner of the property outlining the nature of the violation and giving the owner
633
EXHIBIT 3
EXHIBIT A
or the property a maximum or thirty (JO) days to come into compliance. ff after
lhirly (30) days the violations continue to exist, then lhe City Manager or dcsigncc
shall forward a report lo the City Council through the Planning aod toning
Commission which may recommend that action be taken to: (a) revoke the SUP
!Tom lhe property, (b) refuse issuance of a Certificate of Occupancy. or (c) revoke
lhe Certificate of Occupancy.
(d) Regardless of the notice requil'ements in Section 4(c), if a health and safety v1olauon
is cited, and there exists an imminent health and safety risk to the public as
detc.mnined by the City Manager or designee, lhe Cenifica1e of Occupancy will be
temporarily revoked. The revocation of the Certificate of Occupancy wiU last um11
the health and safety violation is cured, Failure lo cure violation within thirty (30)
days. then lbe City Manager or desjgnce shaU forward a repon to the City Council
through the Planning and Zoning Commission which may recommt:nd Lhat action be
taken lo revokt.: the Certificate of Occupancy.
(e) If property owner is in arrears on any taxes owed to the Ciry, th111 are not being
con~ested, City Manager shall provide a written notice LO lhe property owner of the
taxes owed and give the owner of the propeny a maximum of lhirty (30) days lo
make all necessary payments. If after thirty (30) days the taJccs are still owed to the
City or no arrangements have been made for rcpaymcut, City Manager shall forward
a repol1 to the City Council through the Planning and Zoni11g Commission which
will recommend Tevocauon of the SUP from the property.
(f) The revocation process shall be the same as for a zoning district change, with notice
to property owners within 200 feel. public bearing and recommendation by the
Planning and Zoning Commission, and public hearing and ordinance consideration
by the City Council.
(g) Th~ City Council may deny the SUP revoeation. approve the revocation, deny the
revocation and add additional restrictions 1o lhe SUP, suspend the SUP for a period
lhe Couocil determines, or amend the SUP wilh probationary n:quirements and terms
the Council determines.
(h) Upon revocation of an SUP the property subject lo Lhe SUP may be used for any
permiued ust' within the Semi-Cbmmt!rc1al districl.
5. Subliequeot Applications. An application for an SUP may be withdrawn nt any time.
No application for an SUP pertaining to any lot, parcel or ponion thereof which re4uests
the same use and same oooditions shall be considei:ed within one (I) year of a final
decision denying the application
Section 2. The SUP amendment identified in Section I of the Ordinance is th<.: only
iimendruent and all other provisions of Chapter 14, Section VIII shall remain ..is unchanged.
ScctionJ. This ordinance shall take effect immediately upon its passage, approval and
publication according. lo law.
Section 4. If any section or part of any section or paragraph of this ordinance is declared
invalid or w1constitutional for any reason, it shall not be held 10 invalidace or impair the validity ,
force, or effect of any olhcr section or sections or pan or a section or paragraph of lhis
Ordinance.
Section S. /\II ordinances or parts of ordinances, in conflict herewith are to the extent of such
contlicl hereby repealed The balance of such ordinance is herehy saved !Tom repeal.
634
EXHIBIT 3
EXHIBIT A
PASSED AND APPROVED THIS 10'1' DAY OF DECEMBER2012.
ATTEST:
SECRETARY-MANAGER
635
EXHIBIT 3
EXHIBIT A
OR.DlNANCE NO. 1349
AN ORDINANCE AMENDlNG ORDINANCE NO. O rd. 929, 1-15-96, THE
COMPREHENSIVE ZONING ORDTNANCE OF THE ClTY OF
TERRELL llILLS FOR THE PURPOSE OF ESTABLISHING A SPEClAL
USE PERMIT FOR TRE PORTION OF CB 5848A BLK 11 LOT E IRRG
122.10FTOF11, BEXAR COUNTY, TEXAS WHICH rs ZONED B SEMl-
COMMERCIAL. COMMONLY REFERRED T O AS 2 115 HARRY
WURZBACH, TERRELL HILLS, TEXAS 78209; AND SETTING AN
EFFECTTVE DATE.
WHEREAS, notice of pubJic hearings before the Planning and Zoning Commission and City
Council were published in a newspaper of general circulation; and
WHEREAS, notice of public hearings before lhe Planning and 7..oning Commission and City
Council was sent to property owners within 200 feet of the proposed special us~ permit via
Uniteducts, or as otherwise permmed and approved by the City Council,
d. No parking shall be pennittcd bclund the building located on the Prope11y:
e. No operation of any bus1.I1ess at lhe Property may occur between midnight and 6
a.m.;
638
EXHIBIT 3
EXHIBIT A
f. The Special Use Pennit zoning classification will expire six (6) months afl\!r the
Property is no longer used for at least one (I) of the Permitted Uses~ and
g. Tbe City Council must consider an ~ I
-0
Q
...- r-
m
0
-i
.,
_ F---r- _ v....1t-.\L_t;u·m_ __ _ _
~
w -0
"'11 };:
-:
q z
EVENTIDE DRIVE
641 EXHIBIT 5
EXHIBIT A
642
the___T.\T_
IB
____Tirur ____ ni·-·· SJ@H©ail-aiiif
IL-/:TI)CID hf. 19)~
.--:· ~~~5).---
JL\I W ~ · .fro. Barb~r !fhop &LJl&2Jcr LI 11 "2/2'
.. - ·-- --
EXHIBIT 5
EXHIBIT A
ELECTRO SALES & SERVICE INC
3941 EISENHAUER ROAD
SAN ANTONIO, TX 78218
TEL (210) 497 8969
FAX (21 0) 655 9505
EMAI L: SALIMMERCH ANT 04@AOL .COM
December 12, 2012
The Planning and Zoning Commission
City of Terrel Hills
5100 N. New Braunfels Ave
San Antonio, TX 78209
RE: SUP APPLICATION FOR 2115 HARRY WURZBACH ROAD
I like to apply SUP APPLICATION for 2115 Harry Wurzbach Road, San
Antonio, TX 78209.
(a) The location of the building not to constructed and altered. Its an
existing location and part of 2111/2117 Harry Wurzbach Road.
(b) The parking, loading and driveways not to be constructed.
(c) The location and dimensions of the building is an existence
building, no need to make sidewalks, signs, trash containers etc.
(d) No landscaping and plant materials to be installed.
(e) Its an existing building, no need to change in the strip center.
(f) No need to change the existing building including the
development on adjoining and surrounding properties.
643 EXHIBIT 5
EXHIBIT A
I have a tenant who wants to open Barber Shop and Beauty Parlor.
I would appreciate it if you kindly approve the above mention SUP
APPLICATION as soon as possible so I do not loose my tenant.
Thank you for your co-operation.
-~~OM~
S~~CHANT
cc:
Law Offices of
Kenneth E. Grubbs
4241 Woodcock Drive
San Antonio, TX 78228
I certify that this is a complete and true copy of Mr. Salim Merchant's SUP
Application submitted to the City of Terrell Hills for the property located at 2115
Harry Wurzbach.
CU$is
Columbus Stutes, City Secretary
644 EXHIBIT 5
EXHIBIT A
SALIM MERCHANT
P.O. BOX 790810
SAN ANTONIO, TX 78279
TEL (210) 497 8969
TEL (210) 771 7860
FAX (210) 591 1626
EMAIL: SALIMMERCHANT04@AOL.COM
February 5, 2014
The Planning & Zoning Commission
City of Terrell Hills
5100 N. New Braunfels Ave.
San Antonio, TX 78209
Tel (210) 824 7401
Fax (210) 822 2267
RE: 2113 HARRY WURZBACH ROAD. TERRELL HILLS, TX 78209
Dear Sir,
I. like to open Barber Shop dba STEEL CUTS at 2113 Harry Wurz.bach Road, Terrell
Hills, TX 78209.
I got SUP in May 2013 and failed to open hair and nail saloon because my tenant didn't
want to wait so long, and it was e~pircd. I, therefore, request you to kindly issue SUP for
barber shop as soon as possibJe.
Also, can you authorize to CPS so I can get the light.
Thank You.
SALIM MERCHANT
cc:
1. Mayor Anne Ballantyne aballantyne@terreU-hiUs.com
2. Pro Tem William Ochse wochse@terrell-hills.com
3. Council Person - Charles Parish - cpa ris h@terrel l·h ills.com
• DEPOSITION
I ex;r
645 EXHIBIT 6
EXHIBIT A
City of Terrell Hills Code Chapter I 4--Zoning
B. AH such applications for building permits shall further be accompanied by a complete set of
written plans and specifications covering the proposed construction. Such plans and specifications
shall be deemed insufficient unless they bear the seal of either a registered professional engineer or
an architect licensed under the laws of the State of Texas. All foundation plans shall be deemed
insufficient unless they bear the seal of a registered professional engineer licensed under the Jaws of
the State of Texas. Such set of plans shall be retained by the Building Inspector until a Certificate of
Occupancy and Compliance has been issued.
SECTION XIV: CERTIFICATE OF OCCUPANCY AND COMPLIANCE
A. No building hereafter erected or structurally altered shall be used, occupied or changed in use
until a certificate of occupancy and compliance shall have been issued by the Building Inspector,
stating that the building or proposed use of a building or premises complies with the building laws
and the provisions of these regulations.
B. Certificates of occupancy and compliance shall be applied for coincident with the application
for a building permit and shall be issued within ten days after the erection or structural alteration of
such buildings shall have been completed in conformity with the building laws and these regulations.
A record of all certificates shall be kept on file in the office of the Building Inspector.
SECTION XV: BOARD OF ADJUSTMENT AND PLANNING AND ZONING
COMMISSION
A. Board of Adjustment
1. Organization and Operation of the Board.
a. The Board shall consist of five members and three alternates appointed as required by
Section 10 of Article VITI of the City Charter. At the first meeting of the Board following
publication of an ordinance appointing members, the Board shall select a Chair and Deputy Chair
from its members.
b. A quorum shall consist of four members/alternates. No more than five members/alternates
may vote on any issue before the board; the voting altemate(s), if any, shall be designated by the
Chair at the start of the meeting.
c. Meetings of the Board shall be held at the call of the Chair. Such Chair, or in his absence
the Deputy Chair, may administer oaths and compel the attendance of witnesses. All meetings of
the Board shall be open to the public.
d. The Board shall keep minutes of its proceedings, showing the vote of each member upon
32 ZONJNG-3.DOC.WPD 12·10-12
646 EXHIBIT 7
EXHIBIT A
City o(Terre/l Hills Code Chapter 14--Zoning
each question, or, if absent or failing to vote, indicating such fact, and shall keep records of its
examinations and other official actions, all of which shall be immediately filed in the of fice of
the City Secretary and shall be a public record.
e. A member/alternate shall not vote or participate as a member in any matter before the
Board if the member has any interest in this matter, whether such interest is direct or indirect,
financial or otherwise. In any case, where the question of a member's interest is raised, the Chair
shalJ rule on whether the member should be disqualified.
f. Notice - Public notice of hearing before the Board of Adjustment shall be given for each
separate appeal thereto by publication two times in a newspaper of general circulation in the City
of Terrell Hills, stating the time and place of such hearing, which shall not be earlier than ten
(10) days fi:om the first date of such publication, and in addition thereto the Board of Adjustment
shall mail notices of such hearings to the petitioner and to the owners of property lying within
two hundred feet (200') of any point of the lot or portion thereof on which such variation is
desired, and to all other persons deemed by the Board of Adjustment to be affected thereby.
Such owners and persons shall be determined according to the current tax rolls of the City. The
published notice and the mailed notice may contain notice of a hearing on more than one matter.
Substantial compliance with the provisions of this section shall be deemed sufficient, and the
depositing of such written notice in the mail by the Board of Adjustment shall be deemed in
compliance with the provisions for mailed notices.
g. A fee of one-hundred dollars ($100.00) to cover the administrative costs of such hearing
wiJl be filed with the request for hearing.
2. The Board of Adjustment shall have the following powers:
a To authorize upon appeals in specific cases such variance from the terms ofthis ordinance
as will not be contrary to the public interest, where, owing to special conditions, a literal
enforcement of the provisions of this ordinance will result in unnecessary hardships, and so that
the spirit of this ordinance shall be observed and substantial justice done.
b. To hear and decide appeals where it is alleged there is an error in any order, requirement,
decision, or determination made by an administrative official in the enforcement of this
ordinance. In exercising this authority, the Board may reverse or affinn, in whole or in part, or
modify the administrative official's order, requirement, decision or determination from which an
appeal is taken and make the correct order, requirement, decision, or determination, and for this
purpose the board has the same authority as the administrative official.
(1). Appeals to the Board of Adjustment may be taken by any person aggrieved or by any
officer, department, board or bureau of the municipality affected by any decision of the
administrative officer. Such appeal shall be taken with ten (10) days from the date of any
33 7.0NING-3.DOC.WPD 12- 10-12
647 EXHIBIT 7
EXHIBIT A
City o(Terrell Hills Code Chapter 14--Zoning
such ruling, by filing with the officer from whom the appeal is taken and with the Board of
Adjustment a notice of appeal specifying the grounds thereof. The officer from whom the
appeal is taken shall forthwith transmit to the Board all papers constituting the record upon
which the action appealed from was taken.
(2). An appeal stays all proceedings in furtherance of the action appealed from unless the
officer from whom the appeal is taken certifies to the Board after notice of appeal shall have
been filed that by reason of facts stated in the certificate a stay would, in his opinion, cause
eminent peril to life or property. In such case proceedings shall not be stayed otherwise than
by a restraining order which may be granted by the Board of Adjustment or by a court of
record on application on notice to the officer from whom the appeal is taken and on due
cause shown.
(3). The Board of Adjustment shall fix a reasonable time for the hearing of the appeal and
give notice thereof, as hereinafter set forth, and upon the hearing any party may appear in
person or by agent or by attorney.
3. The concurring vote of four members/alternates of the board is necessary to:
a. Authorize a variation from the terms of this ordinance; or
b. Reverse an order, requirement, decision, or determination of an administrative official.
B. Planning and Zoning Commission
1. Organization and Operation of the Commission.
a. The Commission shall consist of seven members and three alternates appointed as
required by Section 9 ofArticle VIII ofthe City Charter. At the first meeting of the Commission
following publication of an ordinance appointing members, the Board shall select a Chair and
Deputy Chair from its members.
b. A quorum shall consist of four members/alternates of the commission. No final action
shall be taken on any matter except pursuant to a majority vote of the members present; however,
in no case shall less than four votes constitute a majority, and this requirement shall govern
requests for rehearings in zoning cases.
c. Meetings shall be called by the Chair, provided that written notice thereof is mailed or
given to each member at least forty-eight (48) hours prior to the time thereof. No approval or
disapproval of any zoning application shall be given except at a regular meeting. All meetings of
the Commission shall be held at the City Hall.
34 ZONING-3.DOC.WPD 12-10-12
648 EXHIBIT 7
EXHIBIT A
City of Terrell Hills Code Chapter 14--Zoning
d. The Commission shall keep minutes of its proceedings, showing the vote of each member
upon each question, or if absent or failing to vote, indicating such fact, and shall keep records of
its examinations and other official actions, all of which shall be immediately filed in the office of
the City Secretary and shall be a public record.
e. A member/alternate shall not vote or participate as a member in any matter before the
Commission if the member has any interest in this matter, whether such interest is direct or
indirect, financial or otherwise. In any case, where the question of a member/altemate's interest is
raised, the Chair shall rule on whether the member/alternate should be disqualified.
f. Notice - At least fifteen (15) days notice of any public hearing before the Planning and
Zoning Commission of the time and place of such hearing, shall be published in an official
paper, or a paper of general circulation in the city. Notice shall be mailed to owners of real
property lying within two hundred feet (200') of any lot to be replatted or any property upon
which a change in zoning classification is proposed. Such notice shall be given, not less than 15
days before the date set for hearing, to all such owners as indicated on the most recently
approved municipal tax roll.
g. A fee of one-hundred dollars ($100.00) to cover the administrative costs of each hearing
will be filed with the request for hearing.
2. Platting, Replatting and Recording Subdivisions
a. The provisions of Chapter 212 of the Texas Local Government Code will govern the
Commission's consideration of such matters. Ifthe commission disapproves a request no hearing
will be held involving the same tract of land for a six months period unless new, relevant and
substantial evidence, which could not have been secured at the time set for the original hearing is
produced by the applicant under sworn affidavit to that effect.
b. Final Approval Authority. The City Council will be the approval authority for all plats
and rep lats after such requests are considered by the Planning and Zoning Commission in accord
with this ordinance, if there are two dissenting votes on the Planning and Zoning Commission
action.
c. PROCEDURE: Annex A
d. SHORT FORM PROCEDURE: A short form procedure, omitting the filing of the
preliminary plat may be followed when:
( 1) All lots in the proposed subdivision front on a previously dedicated street and are so
situated that no new streets, alleys, easements or public property are required; and
35 ZONING-3.DOC.WPD 12-10-12
649 EXHIBIT 7
EXHIBIT A
City of Terrell Hills Code Chapter 14--Zoning
(2) The utilities and drainage facilities are in place to serve each lot in the proposed
subdivision and require no alterations; and
(3) Staff review by the city confirms that all engineering data remains accurate.
e. The Planning and Zoning Commission may approve and issue an amending plat as
provided in paragraph 212. 016 of the Texas Local Government Code without notice, a hearing,
and the approval of other lot owners.
3. Changes and Amendments to the Comprehensive Zoning Ordinance
a. The City Council may, from time to time, amend, supplement, or change by ordinance the
boundaries of the districts or the regulations herein established.
b. Before taking action on any proposed amendment, supplement or change, the City Council
shall submit the same to the Planning and Zoning Commission for its recommendation and
report.
c. Procedures for amendments of the zoning regulations.
( 1) All petitions, applications, recommendations or proposals for changes in the zoning
district classification of property or for changes in the textual provision of the zoning
ordinance shall be filed with the Planning and Zoning Commission.
(2) It is further provided that no application for the rezoning of any lot, lots or block of
land situated in the city, shall be received or filed with the Planning and Zoning Commission
of the city and no hearing had thereon, if within one year prior thereto the City Council, after
consideration and hearing, has denied an application for rezoning of the same property.
(3) Recommendations. The Planning and Zoning Commission shall make a preliminary
report on all proposed changes and hold a public hearing thereon before submitting its final
report to the City Council.
(4) After the final report is submitted by the Planning and Zoning Commission as
provided above, the City Council shall act upon said report after a public hearing in relation
thereto, at which parties in interest and citizens shall have an opportunity to be heard.
(5) Passage when protested. If the Planning and Zoning Commission has disapproved a
change in zoning or if there is a protest against any change in the reclassification of the
zoning district of any property, signed by the owners oftwenty percent (20%) or more either
of the area of the lots included in such proposed change, or of those immediately adjacent in
36 ZONING-3.DOC.WPD 12-10-12
650 EXHIBIT 7
EXHIBIT A
City of Terrell Hi/Is Code Chapter 14-Zoning
the rear thereof extending two hWldred feet (200') therefrom, or of those directly opposite
thereto extending two hundred feet (200') from the street frontage of such opposite lots, such
amendment shall not become effective except by favorable vote of three-fourths of all the
members of the City Council.
I certify that this is a complete and true copy of Section XV of the Terrell HiJls Code
cu
of Ordinances. ~
~
Columbus Stutes, City Secretary
37 ZONJNG-3.DOC.WPD 12-10-12
651 EXHIBIT 7
EXHIBIT A
EXHIBIT B
FILED
9/28/2016 5:26:57 PM
Donna Kay McKinney
Bexar County District Clerk
Accepted By: Edgar Garcia
CAUSE NO. 2013-CI-00447
SALIM MERCHANT & ELECTRO § IN THE DISTRICT COURT
SALES AND SERVICES, INC., §
Plaintiff, §
§
v. § 57th JUDICIAL DISTRICT
§
THE CITY OF TERRELL HILLS AND §
BILLY W. ENG AND GIN WEI ENG, §
Defendants. § BEXAR COUNTY, TEXAS
&,7<2)7(55(//+,//6¶REPLY IN SUPPORT OF
MOTION FOR SUMMARY JUDGMENT
TO THE HONORABLE JUDGE OF SAID COURT:
COMES NOW the City of Terrell Hills, Texas (hereinafter the ³City´Defendant in the
above-entitled and numbered cause, and files this Reply in Support of Motion for Summary
Judgment and in support thereof, would respectfully show the Court as follows:
I. INTRODUCTION
1. PlaintiffV¶6DOLP0HUFKDQWDQG(OHFWUR6DOHVDQG6HUYLFHV//&UHIHUUHGWRcollectively
KHUHLQDV³3ODLQWLII´ suit arose because a non-conforming commercial use which had existed on
SDUWRIWKHSURSHUW\LQTXHVWLRQLQWKLVODZVXLW³WKH3URSHUW\´ZDVDEDQGRQHGE\WKHSULRUSURSHUW\
owner and prior WR3ODLQWLII¶V purchase of the Property. This part of the Property may still be used
in accordance with the long-VWDQGLQJ]RQLQJFODVVLILFDWLRQRIWKH3URSHUW\³VHPL-FRPPHUFLDO´
Plaintiff later asked the City to up-zone the Property to commercial use, but was denied. Instead,
the City granted his requests for special use permits for the uses requested.
2. Plaintiff did not make available appeals to the Board of Adjustment, and, instead filed suit
against the City and the sellers of the Property, the Eng defendants. The causes of action against
the City are for a taking and for declaratory judgment.
1
686
EXHIBIT B
3. The City filed its Traditional and No-Evidence Motion for Summary Judgment on August
16, 2016, that there is no valid takings claim and the City is entitled to judgment as a matter of law
because:
a. There is no property right to a change in zoning in this case, and there can be no taking
when the City allowed the Plaintiff a special use permit for the use; as a result, Plaintiff has
failed to plead a claim which would waLYHWKH&LW\¶Vimmunity and has failed to establish
standing to sue;
b. Alternatively, Plaintiff failed to exhaust administrative remedies available;
c. $OWHUQDWLYHO\3ODLQWLII¶VFODLPVDUHQRWULSH
d. Alternatively, Plaintiff has failed to provide evidence to create a genuine issue of material
fact to defeat summary judgment for the City on the grounds that the denial to up-zone the
Property GRHVQRWXQUHDVRQDEO\LQWHUIHUHZLWK3ODLQWLII¶VULJKWWRXVHDQGHQMR\WKH3URSHUW\
and is not a regulatory taking as a matter of law;
e. 3ODLQWLII¶VGHFODUDWRU\MXGJPHQWDFWLRQLVILOHGRQO\WRVHHNDWWRUQH\¶VIHHV, will not resolve
ripe justiciable issues between the parties, and should be dismissed as a matter of law;
f. Alternatively, Plaintiff has provided no evidence of one or more of the material elements
of his claims; no evidence of property right that was taken by the City, no evidence of
deprivation of economically viable use of the Property or of investment backed
expectations, and no evidence any action of the City was the proximate cause of damages.
4. 3ODLQWLII ILOHG KLV 5HVSRQVH WR 'HIHQGDQW &LW\ RI 7HUUHOO +LOOV¶ 7UDGLWLRQDO DQG 1R-
Evidence Motion for Final Summary Judgment ³3ODLQWLII¶V5HVSRQVH´RQRUDERXW6HSWHPEHU
+RZHYHU3ODLQWLII¶V5HVSRQVH fails to create a genuine issue of material fact to defeat
'HIHQGDQW¶V0RWLRQIRU6XPPDU\-XGJPHQWDQGIDLOVWRSURYLGHDQ\OHJDOUHDVRQZK\'HIHQGDQW
is not entitled to judgment as a matter of law.
II. REPLY ARGUMENT AND AUTHORITIES
Standard
5. Plaintiff has failed to include the complete standards for both the traditional and no-
evidence summary judgment as raised by Defendant. For a traditional motion, as stated in
2
687
EXHIBIT B
Paragraph 30 of 'HIHQGDQW¶s Motion, once the movant establishes the right to judgment as a matter
of law, the burden shifts to the non-movant who must then set forth sufficient evidence to create
an issue of material fact. (Citing to Houston v. Clear Creek Basin Auth.).
6. For a no-evidence summary judgment, as alleged in paragraph 3RI'HIHQGDQW¶V0RWLRQ
the movant can move for summary judgment even with no evidence on the grounds that there is
no evidence of one or more essential elements of a claim or defense on which the non-movant has
the burden of proof. The burden then shifts to the non-movant to present evidence raising an issue
of material fact.
Objection to Salim Merchant Affidavit
7. Defendant objects WRWKHDIILGDYLWZKLFKLVDWWDFKHGWR3ODLQWLIIV¶5HVSRQVHEHFDXVHLWKDV
no legal weight, is self-serving, contains hearsay, is conclusory, not credible and his accusations
are not supported by evidence. In particular, on page 30 of 32, Plaintiff makes statements
regarding the thought processes of potential tenants which are not within his knowledge, which
are not supported by the evidence, and which, are hearsay. Plaintiff further makes self-serving
statements which are not credible and unsupported by the evidence related to his activity on the
premises. His statements are not plausible given that as he admits, the City has granted him special
use permits to use the space for requested uses. 6HH3ODLQWLII¶V5HVSRQVHSDJHRI, par. 4).
Defendant requests these statements in the second paragraph of the affidavit be stricken.
8. The entire page 31 of 32 is made up of improper legal conclusions by Plaintiff with no
evidentiary support. Defendant requests page 31 of 32 of the affidavit be stricken and that
3ODLQWLII¶VHQWLUHDIILGDYLWEHVWULFNHQIURPWKHVXPPDU\MXGJPHQWHYLGHQFH
3
688
EXHIBIT B
Immunity
9. All previous paragraphs are incorporated herein as if set forth in full.
10. Plaintiff has misstated the burden of proof for immunity. The plaintiff bears the burden to
plead facts that affirmatively demonstrate that governmental immunity has been waived and that
the court has subject-matter jurisdiction. McMahon Contracting, L.P. v. City of Carrollton, 277
S.W.3d 458, 464 (Tex. App.-Dallas 2009, pet. denied). In the present case, although Plaintiff
purports to sue Defendant under takings law, which does contain a waiver of immunity, Plaintiff
has failed to plead a valid claim under this law and therefore, has not properly invoked the Takings
Clause waiver of immunity.
11. As discussed further herein DQGLQ'HIHQGDQW¶V0RWLRQ, such discussion being included in
WKLVVHFWLRQDVLIVHWIRUWKLQIXOODVDPDWWHURIODZ3ODLQWLII¶VSOHDGLQJGRHVQRWDVVHUWIDFWVZKLFK
establish the necessary elements of a takings claim. Plaintiff must first demonstrate a property
ULJKWZKLFKKDVEHHQWDNHQ7KHUHFRXOGEHQRFUHGLEOHWDNLQJVFODLPLQ3ODLQWLII¶VFODLP$VD
matter of law, there is no property right to a zoning classification LQRQH¶VSURSHUW\7KHUHLVno
property right to reinstatement of a non-conforming use status after abandonment by a previous
RZQHU3ODLQWLII¶V5HVSRQVHKDVQRWSURYLGHGWKLV&RXUWZLWKDQ\FDVHODZWRVXSSRUWWKHH[LVWHQFH
any such property rights and could not do so. Further, by 3ODLQWLII¶VRZQDGPLVVLRQDWSDJHRI
 LQ 3ODLQWLII¶V 5HVSRQVH WKH &LW\ SURYLGHG 3ODLQWLII ZLWK VSHFLDO XVH SHUPLWV IRU WKH XVH KH
requested.
12. These facts do not support a takings claim and Plaintiff has failed to invoke the Takings
&ODXVH¶VZDLYer of immunity. 3ODLQWLIIOLVWVIDFWRUVUHODWHGWRD³YLDEOHDOOHJDWLRQ´IURPWKHCity
of Dallas case. The facts in the present case do not rise to the level contemplated in these factors.
There can be no credible allegation of ouster, unreasonable restrictions, or overly burdensome
4
689
EXHIBIT B
standards when Plaintiff is simply subject to the zoning that existed on the Property when he
bought the Property and has by his own admission been given special use permits for the uses he
requested, including a barber shop use. ,I3ODLQWLII¶VFODLPVFRQVWLWXWHDWDNLQJWKHQODQGRZQHUV
all over the land could claim a taking simply because they are subject to zoning classifications set
by cities. There is no legal precedent for any such claim to rise to a valid takings case. Plaintiff
points the Court to language in his pleading which appears to track the factors. However, he does
not demonstrate factual elements to support these legal conclusions.
13. 3ODLQWLII¶VFDVHVKRXOGEHGLVPLVVHGDVDPDWWHURIODZ
Standing
14. Plaintiffs incorrectly assert that a verified plea is required for the defense of standing and
FRQIXVHV³VWDQGLQJ´ZLWK³FDSDFLW\´6WDQGLQJLVQRWDQDIILUPDWLYHGHIHQVHEXWLVDOHJDOTXHVWLRQ
regarding subject-matter jurisdiction. Standing cannot be conceded or waived but is a legal
question regarding subject-matter jurisdiction; therefore, it is not an affirmative defense. See Texas
Ass’n of Business v. Texas Air Control Bd., 852 S.W.2d 440, 1993 Tex. LEXIS 22, 36 Tex. Sup.
J. 607 (Tex. 1993). Because it is not an affirmative defense, a verified answer was unnecessary.
In addition, Plaintiff has no standing because he was not personally aggrieved because the non-
FRQIRUPLQJXVHH[SLUHGSULRUWR3ODLQWLII¶VSXUFKDVHRIWKH3URSHUW\7KHULJKWWRVXHIRUWKHLQMXU\
is a personal right belonging to the person owning the property at the time of the injury. Denman
v. Citgo Pipeline Co., 123 S.W.3d 728, 2003 Tex. App. LEXIS 10242, 159 Oil & Gas Rep. 509
(Tex. App. Texarkana 2003) relying on Abbott v. City of Princeton, 721 S.W.2d 872, 875 (Tex.
App.--Dallas 1986, writ ref'd n.r.e.); Lay v. Aetna Ins. Co., 599 S.W.2d 684, 686 (Tex. Civ. App.-
-Austin 1980, writ ref'd n.r.e.). Therefore, without express provision, the right does not pass to a
subsequent purchaser of the property. Denman, supra; Abbott, 721 S.W.2d at 875; Lay, 599
5
690
EXHIBIT B
6:GDW³$PHUHVXEVHTXHQWSXUFKDVHUFDQQRWUHFRYHUIRUDQLQMXU\FRPPLWWHGEHIRUHKLV
RUKHUSXUFKDVH´Denman, supra; Lay, 599 S.W.2d at 686. Here, it is undisputed that Plaintiff
bought the Property from the Eng Defendants after the non-conforming use expired. Therefore,
3ODLQWLII¶V XQVXSSRUWHG DVVHUWLRQ WKDW VWDQGLQJ ZDV VRPHKRZ DFTXLUHG ZKHQ KH DFTXLUHG WKH
Property fails to raise a genuine issue of material fact. As such the City is entitled to summary
judgment.
Ripeness and/or Exhaustion of Remedies
15. ,QKLVUHVSRQVHWRWKH&LW\¶VDVVHUWLRQWKDW3ODLQWLII¶VFODLPVDUHQRWULSHDQGWKDW3ODLQWLII
has not exhausted administrative remedies, Plaintiff asserts that his takings claim LVEDVHG³WKH
reversion from commercial to semi-commercial [which] is a wholly separate issue than [his]
VXEVHTXHQWUHTXHVWIRUDVSHFLDOXVHSHUPLW´DQGWKDWWKH&LW\¶VILQDOGHFLVLRQDVWRWKHFHVVDWLRQ
of the non-conforming use occurred when the City first implemented the zoning of the Property as
commercial with a semi-commercial non-conforming clause. See Response at page 13. Such
DVVHUWLRQVIDLOWRRYHUFRPHWKH&LW\¶VULSHQHVVFKDOOHQJH)LUVWWKHIDFWVDUHXQGLVSXWHGWKDWWKH
&LW\¶VGHFLVLRQWRzone this Property as semi-commercial with a non-conforming commercial use
occurred in 1962. Second, Plaintiff is not challenging that the Property was zoned with a
nonconforming use; Plaintiff is challenging the City staff decision when the cessation of the non-
conforming use occurred. See Plaintiff’s Response at page 13. Plaintiff alleges his claims arise
from the cessation of the non-conforming use, or as he states in his response, his takings claim is
EDVHG RQ ZKHQ ³WKH UHYHUVLRQ IURP FRPPHUFLDO WR Vemi-FRPPHUFLDO´ RU ³ZKHQ WKH ORVV RI WKH
FRPPHUFLDOVWDWXV´RFFXUUHG3ODLQWLIIGRHVQRWEULQJIRUWKDQ\HYLGHQFHWKDWKHREWDLQHGDILQDO
decision in compliance with the Texas Local Government Code and the Zoning Code with regard
6
691
EXHIBIT B
to the cessation of the nonconforming use for the middle suite of the Property or the decision that
the barber shop was not an allowed semi-commercial use in the middle suite.
16. ,QDGGLWLRQ3ODLQWLII¶VDVVHUWLRQWKDWKHREWDLQHGDILQDOGHFLVLRQGHQ\LQJWKHUHTXHVWWR
upzone the Property to commercial fails to satisfy a ripeness inquiry on his takings claim. The
IDFWVDUHXQGLVSXWHGWKDWWKH&LW\JUDQWHG3ODLQWLII¶VDSSOLFDWLRQVIRUD6SHFLDO8VH3HUPLWDOORZLQJ
additional permitted uses for the Property, including a barber shop/hair salon. There is no final
decision and the City has not closed the door to continued future uses for the middle suite of the
Property. See Hamilton Bank Williamson County Reg’l Planning Comm’n v. Hamilton Bank, 473
U.S. 172, 186 (1985). As such, WKH &LW\ LV HQWLWOHG WR GLVPLVVDO RI 3ODLQWLII¶V FODLPV EDVHG RQ
ULSHQHVVDQG3ODLQWLII¶VIDLOXUHWRH[KDXVWDGPLQLVWUDWLYHUHPHGLHVUHODWHGWRWKRVHGHFLVLRQV
&LW\¶V $FWLRQV GR Substantially Advance Legitimate State Interest and Does not
Unreasonably Interfere with Rights to Use and Enjoy
17. 3ODLQWLII¶VUHVSRQVHPLVFKDUDFWHUL]HVKLVUHTXHVWIRUXS]RQLQJDVDUHTXHVWWRXS]RQH only
WKHPLGGOHVXLWHZKHQLQIDFW([KLELWDWWDFKHGWR'HIHQGDQW¶V0RWLRQIRU6XPPDU\-XGJPHQW
clearly reflects that Plaintiff requested that the entire Property strip be permanently zoned
FRPPHUFLDO,QDGGLWLRQ3ODLQWLII¶VUHOLDQFHRQDOLVWRIEXViness he claims are allowed to operate
ZLWKLQRQHPLOHRIKLVVWULSPDOOIDLOVWRGHPRQVWUDWHWKDWWKH&LW\¶V]RQLQJGHFLVLRQUHJDUGLQJWKH
Property does not substantially advance a legitimate City interest. A bare list of business names
without providing their specific location, the location relative to residential homes, the availability
of parking spaces, the impact on traffic, the signage, the zoning for each, and the impact on the
&LW\¶VGHYHORSPHQWIDLOVWRFDUU\3ODLQWLII¶VEXUGHQWRSURYHWKDWWKH0 year old zoning ordinance
LQWKLVFDVHLVVRPHKRZDUELWUDU\RUXQUHDVRQDEOH$WDPLQLPXP3ODLQWLII¶VDIILGDYLWGRHVQRW
even substantiate the list of business names contained in the Response. Plaintiff does not, at a
7
692
EXHIBIT B
minimum, produce evidence that the businesses he relies on are even located within the City of
7HUUHOO+LOOV,QDGGLWLRQ3ODLQWLII¶VSHUVRQDORSLQLRQWKDWLWLVDUELWUDU\RULUUDWLRQDOIRUWKH&LW\¶V
zoning to allow for the middle suite not to be zoned commercial when the end suites are zoned
commercial is insufficient for the Court to overturn a presumptively valid zoning ordinance. See
City of Fort Worth, 388 S.W.2d 400, 402 (Tex. 1964). 1RUGRHV3ODLQWLII¶VSHUVRQDORSLQLRQWKDW
having the middle suite zoned commercial demonstrate that the suite would somehow be more
economically viable. The former owner Billy Eng testified that the laundromat operated in the
middle suite under the nonconforming commercial use and his business failed. See Exhibit 8
attached hereto, excerpt of Bill\(QJ¶V'HSRVLWLRQSDJH+LVWRULFDOXVHVRIWKHSURSHUW\DUH
critically important when determining the reasonable investment-backed expectations of the
landowner." Mayhew v. Town of Sunnyvale, 964 S.W.2d 922, 937, 41 Tex. Sup. Ct. J. 517 (Tex.
1998).
18. /DVWO\3ODLQWLII¶VDVVHUWLRQWKDWWKHVHPL-commercial status makes it impossible to lease is
a completely unsupported personal opinion, especially when Plaintiff has testified that he had
several potential barbershop and hair salon tenants for the middle suite for which the City provided
3ODLQWLIIVSHFLDOXVHSHUPLWV3ODLQWLII¶VDVVHUWLRQRILPSRVVLELOLW\LVDOVRQRWVKDUHGE\WKHIRUPHU
owner Billy Eng who testified that he was planning on letting the non-conforming use permit lapse.
See Exhibit 2 ± H[FHUSWVRI%LOO\(QJ¶VGHSRVLWLRQDWWDFKHGWR WKH&LW\¶V 0RWLRQIRU6XPPDU\
Judgment. Furthermore,
Attorney Fees
19. 3ODLQWLII LQFRUUHFWO\ DVVHUWV WKDW KH LV HQWLWOHG WR DWWRUQH\¶V IHHV LQ WKLV WDNLQJV VXLW
$WWRUQH\¶V IHHV DUH QRW UHFRYHUDEOH XQOHVs authorized by statute or by contract. See New
8
693
EXHIBIT B
Amsterdam Casualty Co. v. Texas Indus. Inc., 414 S.W.2d 914, 915, 10 Tex. Sup. Ct. J. 357 (Tex.
1967). Texas law provides no statutory authority for awarding attorney's fees in inverse
condemnation claims arising under Article I, section 17 of the Texas Constitution. See State v.
Biggar, 848 S.W.2d 291, 298 (Tex. App.--Austin 1993), aff'd, 873 S.W.2d 11 (Tex. 1994).
WHEREFORE, PREMISES CONSIDERED, Defendant City of Terrell Hills prays this
Court grant its Motion for Summary Judgment and dismiss all claims against it, that Plaintiffs,
Salim Merchant and Electro Sales and Services, Inc. take nothing by their suit against the City,
and that the City have and recover such other relief, both general and specific, at law or in equity,
to which the City may be justly entitled.
Respectfully submitted,
MCKAMIE KRUEGER, LLP
941 Proton Road
San Antonio, Texas 78258
(210) 546-2122
(210) 546-2130 Fax
/s/: Barbara L. Quirk
WILLIAM M. McKAMIE
State Bar No. 13686800
mick@mckamiekrueger.com
BARBARA L. QUIRK
State Bar No. 16436750
barbara@mckamiekrueger.com
ADOLFO RUIZ
State Bar No. 17385600
adolfo@mckamiekrueger.com
SUE ANN GREGORY
State Bar No. 00795392
sue@mckamiekrueger.com
ATTORNEYS FOR DEFENDANT CITY
OF TERRELL HILLS
9
694
EXHIBIT B
CERTIFICATE OF SERVICE
I certify that a true and correct copy of City of Terrell Hills’ Reply to Plaintiff’s Response
to Motion for Summary Judgment was served according to the Texas Rules of Civil Procedure
on all counsel of record in the manner specified below on September 28, 2016 as follows:
Carlo Garcia Via E-Serve and e-mail
OLIVA, SAKS, GARCIA AND CURIEL, LLP
14255 Blanco Road
San Antonio, Texas 78216
Fax: 210.308.6939
cglaw@osglaw.com
Jay Moritz Via E-Serve and e-mail
THE LAW OFFICES OF JAY MORITZ
2600 SW Military Drive, Suite 118
San Antonio, Texas 78224
Fax: 210.928.9118
JayLaw5@aol.com
/s/: Barbara L. Quirk
Barbara L. Quirk
10
695
EXHIBIT B
3DJH 3DJH
 WKHH[SLUDWLRQRQWKHZULWWHQFRQWUDFWRUZULWWHQOHDVHWKDW\RX  DOORZHGKLPWRWHUPLQDWHWKHOHDVH,VWKHUHDZULWWHQGRFXPHQW
 KDG"  WKDWUHIOHFWVWKDW\RXDOORZHGKLPWRWHUPLQDWHWKDWOHDVHRUZDV
 $,DOORZHGKLPWREUHDNWKHOHDVH  LWDYHUEDODJUHHPHQW"
 42ND\6ROHWPHDVNWKHTXHVWLRQDJDLQ2ND\,V  $,WZDVDYHUEDODJUHHPHQWDWWKHWLPH
 LWDQG,EHOLHYH,XQGHUVWDQGWKHDQVZHUEDVHGRQ\RXU\RX  42ND\$QGZKDWZDVWKHUHDVRQWKDW\RXDOORZHGKLPWR
 NQRZ\RXUUHFHQWDQVZHU,I\RXFDQOLVWHQWRWKLVSDUWLFXODU  WHUPLQDWHWKHOHDVHRWKHUWKDQWKHUHDVRQWKDW\RXJDYHZKLFK
 TXHVWLRQ,VLWVDIHWRDVVXPHWKDWKHOHIWKLVOHDVHHDUO\WKDW  ZDVKLVEXVLQHVVZDVIDLOLQJ"
 ZDVVHWIRUWKLQWKHOHDVHDJUHHPHQW"  $7KDW
VDOO,KDYH
 $
duties with his shift.
PUBLIC HEARING ON THE REQUEST FROM MR. SALIM MERCHANT FOR THE
REZONING OF TllE PROPERTY LOCATED AT 211 5 llARRY WURZBACH ROAD
FROM SEMI-COMMERCIAL TO COMMERCIAL ZONrNG
Mayor Camp opened the public hearing al 5:05 pm on Mr. Merchant's requesl. The City
Manager explained that this request had been submitted lo the Planning and Zoning Cnmmission
and rhe recommendation of the commission was against the request for re-zotU.ng. The property
in question is localed between the Fort Sam Grocery W1d Ebbt1de Lounge.
Mr Merchant addressed Council explaining that when he purchased the properly he
though1 the entire su·ip was commercial and U1at without the re-2oning he cannot lease 1.he
property as he had intended and in addiuon this will decrease the property value. Mr. Merchant
said that he has a similar property on Eisenhauer which is all commercial. There is a spnns har,
convi:aience store as well as his office localed there and he ht1s encountered ao problems with
the neighbors during U1e past ten years.
Mr. Flagg spoke to Council saying that Lherc was a reason the pr•operties had heen re-
zorn:d. I he Laundroma1 that was located there previously hlls been closed for more than six
momhs and 1herefore is zoned semi-commercial and it should be kepi 1111s way. l le said he
agreed with the recommeudatiou of the P&Z Commjss100.
Mrs. Ryan said that her concern is tha1 once the property is zoned commercial there wtll
be no way of controlling what type of business opens there. She said she believed Mr.
Merchant's intentions were good but tltal does not mean iI he sells the property the new owner,s
would be. She explained 1ha1 their property backs directly up 10 that one and they have had
problems over the years with disturbances from the " drunks and derelicts" tha1 hang out in 1he
parking lot. Mr. Ryan agreed slating that at one time it was such a problem lhcy requested and
received a variance to put in a higher fence.
Couucilmembe1 Ocl1se verified with I.he City Manager that all of those p1-operties rue
zoned semi-commercial; the store and bar are grandfathered in because they were in existence
prior to the re-zoning The City Manager confirmed this saying they are not z.oned commercial
Councilmember Ochse asked what types of businesses WL"f'C alloweducts, or as otherwise permmed and approved by the City Council,
d. No parking shall be pennittcd bclund the building located on the Propc11y:
e. No operation of any bus1.I1ess at lhe Property may occur between midnight and 6
a.m.;
638
EXHIBIT 3
EXHIBIT D
f. The Special Use Pennit zoning classification will expire six (6) months afl\!r the
Property is no longer used for at least one (I) of the Permitted Uses~ and
g. Tbe City Council must consider an140 S.W.3d 660
Client/Matter: -None-
Search Terms: Sheffield Dev. Co. v. City of Glenn Heights, 140 S.W.3d 660
Search Type: Natural Language
Narrowed by:
Content Type Narrowed by
Cases -None-
| About LexisNexis | Privacy Policy | Terms & Conditions | Copyright © 2017 LexisNexis
BARBARA QUIRK
EXHIBIT E
Caution
As of: September 25, 2017 9:01 PM Z
Sheffield Dev. Co. v. City of Glenn Heights
Supreme Court of Texas
October 30, 2002, Argued ; March 5, 2004, Delivered
NO. 02-0033
Reporter
140 S.W.3d 660 *; 2004 Tex. LEXIS 195 **; 47 Tex. Sup. J. 327
SHEFFIELD DEVELOPMENT COMPANY, INC., PETITIONER, v. CITY OF GLENN HEIGHTS, TEXAS,
RESPONDENT
Subsequent History: Rehearing denied by Sheffield Dev. Co. v. City of Glenn Heights, 2004 Tex. LEXIS 765
(Tex., Sept. 3, 2004)
Prior History: ON PETITION FOR REVIEW FROM THE COURT OF APPEALS FOR THE TENTH DISTRICT OF
TEXAS
City of Glenn Heights v. Sheffield Dev. Co., 61 S.W.3d 634, 2001 Tex. App. LEXIS 7212, 45 Tex. Sup. Ct. J. 984
(Tex. App. Waco, 2001)
Disposition: Court reversed in part and affirmed in part the court of appeals' judgment, rendered judgment in part,
and remanded the case in part to the trial court.
Core Terms
rezoning, City's, moratorium, zoning, regulation, court of appeals, damages, argues, city council, trial court, plat,
expectations, acre, landowner, economic impact, vested, compensable taking, recommended, deprived,
substantially advance, investment-backed, advancement, plans, ripe, declaratory, downzoning, interfered,
purposes, factors, issues
Case Summary
Procedural Posture
Appellant developer sued appellee city in the district court for two inverse condemnation claims and a declaratory
judgment. The district court found for the developer on one of the inverse condemnation claims. The Court of
Appeals for the Tenth District of Texas found that the developer was entitled to recover on both takings claims,
affirmed the damages award, found the declaratory relief claim was ripe, and remanded. The parties appealed.
Overview
After a moratorium on development, the city rezoned undeveloped property owned by the developer, reducing the
number of residences that could be built on the property. The developer contended that the moratorium and the
rezoning each constituted a taking of its property without adequate compensation in violation of Tex. Const. art. I, §
17. The developer separately requested a declaration that its development rights became vested when it submitted
an application during an earlier hiatus in the moratorium. The Supreme Court of Texas found that, on balance, the
city's rezoning substantially advanced legitimate government interests, and was not a taking. Further, the court
could not say that the moratorium did not substantially advance a legitimate governmental purpose. Nor could the
BARBARA QUIRK
EXHIBIT E
Page 2 of 25
140 S.W.3d 660, *660; 2004 Tex. LEXIS 195, **195
court say that the moratorium went too far towards a taking. Therefore, there was not a compensable taking of the
developer's property by the moratorium. However, the developer's vested rights claim was ripe for determination, as
there was nothing to prevent the trial court from ruling on the merits of the claim.
Outcome
The judgment of the appellate court was reversed on the takings claims and judgment was rendered that the
developer take nothing against the city. The judgment of appellate court remanding the developer's claim for a
declaration that its development rights were vested was affirmed, and the case was remanded to the trial court to
determine whether the developer fixed its rights by submitting a plat during a hiatus in the moratorium.
LexisNexis® Headnotes
Constitutional Law > Bill of Rights > Fundamental Rights > Eminent Domain & Takings
HN1[ ] Fundamental Rights, Eminent Domain & Takings
See Tex. Const. art. I, § 17.
Constitutional Law > Bill of Rights > Fundamental Rights > Eminent Domain & Takings
Environmental Law > Land Use & Zoning > Eminent Domain Proceedings
Constitutional Law > Bill of Rights > State Application
HN2[ ] Fundamental Rights, Eminent Domain & Takings
The Takings Clause of the Fifth Amendment to the United States Constitution is made applicable to the states
through the Fourteenth Amendment.
Constitutional Law > Bill of Rights > Fundamental Rights > Eminent Domain & Takings
HN3[ ] Fundamental Rights, Eminent Domain & Takings
The Texas Constitution provides that no person's property shall be taken, damaged, or destroyed for or applied to
public use without adequate compensation being made. Tex. Const. art. I, § 17.
Constitutional Law > Bill of Rights > Fundamental Rights > Eminent Domain & Takings
HN4[ ] Fundamental Rights, Eminent Domain & Takings
The Takings Clause of the Fifth Amendment states that nor shall private property be taken for public use without
just compensation. U.S. Const. amend. V.
BARBARA QUIRK
EXHIBIT E
Page 3 of 25
140 S.W.3d 660, *660; 2004 Tex. LEXIS 195, **195
Constitutional Law > Bill of Rights > Fundamental Rights > Eminent Domain & Takings
Real Property Law > Inverse Condemnation > Constitutional Issues
Civil Procedure > Special Proceedings > Eminent Domain Proceedings > General Overview
Environmental Law > Land Use & Zoning > Eminent Domain Proceedings
Real Property Law > Inverse Condemnation > General Overview
Real Property Law > Inverse Condemnation > Regulatory Takings
HN5[ ] Fundamental Rights, Eminent Domain & Takings
By their plain terms, the takings provisions of the state and federal constitutions do not limit the government's power
to take private property for public use but instead require that a taking be compensated. Physical possession is,
categorically, a taking for which compensation is constitutionally mandated, but a restriction in the permissible uses
of property or a diminution in its value, resulting from regulatory action within the government's police power, may or
may not be a compensable taking. All property is held subject to the valid exercise of the police power and thus not
every regulation is a compensable taking, although some are. There is no one test and no single sentence rule. The
need to adjust the conflicts between private ownership of property and the public's interests is a very old one which
has produced no single solution.
Real Property Law > Inverse Condemnation > Constitutional Issues
Real Property Law > Eminent Domain Proceedings > General Overview
HN6[ ] Inverse Condemnation, Constitutional Issues
The general rule, at least, is that while property may be regulated to a certain extent, if regulation goes too far it will
be recognized as a taking, this is a question of degree -- and therefore cannot be disposed of by general
propositions. The question at bottom is upon whom the loss of the changes desired should fall.
Constitutional Law > Bill of Rights > Fundamental Rights > Eminent Domain & Takings
HN7[ ] Fundamental Rights, Eminent Domain & Takings
The United States Supreme Court acknowledges that determining how far is too far in a takings claim has proved to
be a problem of considerable difficulty. While the Supreme Court recognizes that the Fifth Amendment's guarantee
is designed to bar government from forcing some people alone to bear public burdens which, in all fairness and
justice, should be borne by the public as a whole, the Supreme Court, quite simply, has been unable to develop any
set formula for determining when justice and fairness require that economic injuries caused by public action be
compensated by the government, rather than remain disproportionately concentrated on a few persons. Indeed,
whether a particular restriction will be rendered invalid by the government's failure to pay for any losses proximately
caused by it depends largely upon the particular circumstances in that case.
BARBARA QUIRK
EXHIBIT E
Page 4 of 25
140 S.W.3d 660, *660; 2004 Tex. LEXIS 195, **195
Constitutional Law > Bill of Rights > Fundamental Rights > Eminent Domain & Takings
Real Property Law > Inverse Condemnation > Constitutional Issues
Real Property Law > Eminent Domain Proceedings > General Overview
Real Property Law > Inverse Condemnation > General Overview
Real Property Law > Inverse Condemnation > Regulatory Takings
HN8[ ] Fundamental Rights, Eminent Domain & Takings
The United States Supreme Court has identified at least two discrete categories of regulatory action as
compensable without case-specific inquiry in a takings claim. One is where regulation compels a property owner to
suffer a physical invasion of his property. The direct, physical effect on property, though short of government
possession, makes the regulation categorically a taking. Another is where regulation denies all economically
beneficial or productive use of land. To deprive an owner of all economically beneficial use of land is tantamount to
depriving him of the land itself. But this is limited to the extraordinary circumstance when no productive or
economically beneficial use of land is permitted and the landowner is left with a token interest. In addition to these
two situations, the Supreme Court has stated that regulation effects a taking if it does not substantially advance
legitimate state interests. Otherwise, however, whether regulation has gone too far and become too much like a
physical taking for which the constitution requires compensation requires a careful analysis of how the regulation
affects the balance between the public's interest and that of private landowners.
Real Property Law > Eminent Domain Proceedings > General Overview
Real Property Law > Inverse Condemnation > Regulatory Takings
HN9[ ] Real Property Law, Eminent Domain Proceedings
In engaging in the essentially ad hoc, factual inquiries in takings by regulation cases, the United States Supreme
Court's decisions have identified several factors that have particular significance. The economic impact of the
regulation on the claimant and, particularly, the extent to which the regulation has interfered with distinct
investment-backed expectations are, of course, relevant considerations. So, too, is the character of the
governmental action. A taking may more readily be found when the interference with property can be characterized
as a physical invasion by government, than when interference arises from some public program adjusting the
benefits and burdens of economic life to promote the common good.
Real Property Law > Eminent Domain Proceedings > General Overview
HN10[ ] Real Property Law, Eminent Domain Proceedings
The factors to consider in a taking by regulation case are as follows: (1) the economic impact of the regulation on
the claimant; (2) the extent to which the regulation has interfered with distinct investment-backed expectations; and
(3) the character of the governmental action. Nevertheless, the United States Supreme Court has cautioned that
BARBARA QUIRK
EXHIBIT E
Page 5 of 25
140 S.W.3d 660, *660; 2004 Tex. LEXIS 195, **195
these factors do not comprise a formulaic test. Case law does not supply mathematically precise variables, but
instead provides important guideposts that lead to the ultimate determination whether just compensation is
required. The temptation to adopt what amount to per se rules in either direction must be resisted. Thus, for
example, the economic impact of a regulation may indicate a taking even if the landowner has not been deprived of
all economically beneficial use of his property. Nor are the three factors the only ones relevant in determining
whether the burden of regulation ought in all fairness and justice to be borne by the public.
Real Property Law > Eminent Domain Proceedings > General Overview
HN11[ ] Real Property Law, Eminent Domain Proceedings
Whether a regulatory taking has occurred, depends on a complex of factors. The analysis necessarily requires a
weighing of private and public interests and a careful examination and weighing of all the relevant circumstances in
this context. Courts consider all of the surrounding circumstances in applying a fact-sensitive test of
reasonableness.
Business & Corporate Compliance > ... > Real Property Law > Zoning > Constitutional Limits
Environmental Law > Land Use & Zoning > Constitutional Limits
Real Property Law > Inverse Condemnation > Constitutional Issues
Constitutional Law > ... > Fundamental Rights > Procedural Due Process > General Overview
Constitutional Law > Substantive Due Process > Scope
Real Property Law > Eminent Domain Proceedings > General Overview
HN12[ ] Zoning, Constitutional Limits
While determining whether a property regulation is unconstitutional requires the consideration of a number of
factual issues, the ultimate question of whether a zoning ordinance constitutes a compensable taking or violates
due process or equal protection is a question of law, not a question of fact. In resolving this legal issue, courts
consider all of the surrounding circumstances.
Civil Procedure > Special Proceedings > Eminent Domain Proceedings > General Overview
Civil Procedure > Trials > Jury Trials > Province of Court & Jury
HN13[ ] Special Proceedings, Eminent Domain Proceedings
While appellate courts depend on the district court to resolve disputed facts regarding the extent of the
governmental intrusion on the property, the ultimate determination of whether the facts are sufficient to constitute a
taking is a question of law.
BARBARA QUIRK
EXHIBIT E
Page 6 of 25
140 S.W.3d 660, *660; 2004 Tex. LEXIS 195, **195
Business & Corporate Compliance > ... > Real Property Law > Zoning > Constitutional Limits
Real Property Law > Eminent Domain Proceedings > General Overview
Environmental Law > Land Use & Zoning > Eminent Domain Proceedings
Real Property Law > Inverse Condemnation > General Overview
Real Property Law > Inverse Condemnation > Regulatory Takings
HN14[ ] Zoning, Constitutional Limits
The application of a general zoning law to particular property effects a taking if the ordinance does not substantially
advance legitimate state interests.
Governments > Courts > Judicial Precedent
HN15[ ] Courts, Judicial Precedent
Prior decisions need not be reaffirmed periodically to retain authority.
Governments > Courts > Judicial Precedent
HN16[ ] Courts, Judicial Precedent
If a precedent of the United States Supreme Court has direct application in a case, yet appears to rest on reasons
rejected in some other line of decisions, a lower court should follow the case which directly controls, leaving to the
Supreme Court the prerogative of overruling its own decisions.
Governments > Courts > Judicial Precedent
HN17[ ] Courts, Judicial Precedent
The Supreme Court of Texas looks to federal takings cases for guidance in applying the Texas Constitution.
Real Property Law > Inverse Condemnation > Constitutional Issues
Real Property Law > Eminent Domain Proceedings > General Overview
HN18[ ] Inverse Condemnation, Constitutional Issues
Whether regulation substantially advances legitimate State of Texas interests is an appropriate test for a
constitutionally compensable taking, at least in some situations.
BARBARA QUIRK
EXHIBIT E
Page 7 of 25
140 S.W.3d 660, *660; 2004 Tex. LEXIS 195, **195
Real Property Law > Eminent Domain Proceedings > General Overview
HN19[ ] Real Property Law, Eminent Domain Proceedings
Government action may be for a public -- as opposed to a private -- purpose, even if that purpose is not a legitimate
one for the government to engage in. For instance, the government may not require a person to give up a
constitutional right in exchange for a discretionary benefit conferred by the government where the benefit sought
has little or no relationship to the property.
Constitutional Law > Equal Protection > Judicial Review > Standards of Review
HN20[ ] Judicial Review, Standards of Review
For equal protection purposes, government action has a rational basis if one can be conceived, regardless of
whether the government had it in mind when it took the action complained of.
Business & Corporate Compliance > ... > Real Property Law > Zoning > Constitutional Limits
Real Property Law > Eminent Domain Proceedings > General Overview
Real Property Law > Ownership & Transfer > Public Entities
HN21[ ] Zoning, Constitutional Limits
United States Supreme Court cases describe the condition for abridgement of property rights through the police
power as a substantial advancing of a legitimate state interest. The Supreme Court is inclined to be particularly
careful about the adjective where the actual conveyance of property is made a condition to the lifting of a land-use
restriction, since in that context there is heightened risk that the purpose is avoidance of the compensation
requirement, rather than the stated police-power objective.
Constitutional Law > Equal Protection > Judicial Review > Standards of Review
HN22[ ] Judicial Review, Standards of Review
An elevated standard of review must not be applied, but it ordinarily is, and should be, harder for the government to
show that its interests have been substantially advanced by regulation directed at one lone landowner.
Real Property Law > Eminent Domain Proceedings > General Overview
HN23[ ] Real Property Law, Eminent Domain Proceedings
BARBARA QUIRK
EXHIBIT E
Page 8 of 25
140 S.W.3d 660, *660; 2004 Tex. LEXIS 195, **195
The substantial advancement requirement for a legitimate regulation must be more than a pleading requirement,
and compliance with it more than an exercise in cleverness and imagination. But it must not be proved to a
certainty.
Real Property Law > Eminent Domain Proceedings > General Overview
HN24[ ] Real Property Law, Eminent Domain Proceedings
Lost profits are clearly one relevant factor to consider in assessing the value of property and the severity of the
economic impact of rezoning on a landowner.
Constitutional Law > Bill of Rights > Fundamental Rights > Eminent Domain & Takings
Real Property Law > Financing > Construction Loans
HN25[ ] Fundamental Rights, Eminent Domain & Takings
The takings clause does not charge the government with guaranteeing the profitability of every piece of land subject
to its authority. Purchasing and developing real estate carries with it certain financial risks, and it is not the
government's duty to underwrite this risk as an extension of obligations under the takings clause.
Civil Procedure > Special Proceedings > Eminent Domain Proceedings > Jury Trials
Real Property Law > Inverse Condemnation > Regulatory Takings
Real Property Law > Eminent Domain Proceedings > General Overview
Real Property Law > Inverse Condemnation > Remedies
HN26[ ] Eminent Domain Proceedings, Jury Trials
Diminution in value is not the only element to be considered in a regulatory takings claim.
Governments > Local Governments > Claims By & Against
HN27[ ] Local Governments, Claims By & Against
The actions and motives of individual officials and employees of a city are not those of the city itself.
Governments > Local Governments > Claims By & Against
Governments > Local Governments > Employees & Officials
BARBARA QUIRK
EXHIBIT E
Page 9 of 25
140 S.W.3d 660, *660; 2004 Tex. LEXIS 195, **195
HN28[ ] Local Governments, Claims By & Against
Evidence of one city official's motives cannot be attributed to the city itself.
Judges: JUSTICE HECHT delivered the opinion of the Court.
Opinion by: Nathan L. Hecht
Opinion
[*663] JUSTICE HECHT delivered the opinion of the Court.
After a twelve-month moratorium on development, the City of Glenn Heights rezoned undeveloped property owned
by Sheffield Development Co., reducing the number of residences that could be built on the property. Sheffield
contends that the moratorium and the "downzoning" each constituted a taking of its property without adequate
compensation in violation of article I, section 17 of the Texas Constitution. 1 Sheffield separately requests a
declaration that its development rights became vested when it submitted an application during an earlier hiatus in
the moratorium. Following a bench trial on liability issues and a jury trial on damages, the district court rendered
judgment for Sheffield for $ 485,000, plus pre- and post-judgment interest, on the downzoning takings claim only.
The court concluded that Sheffield's claim for declaratory relief was not ripe for adjudication. A divided court of [**2]
appeals concluded that Sheffield was [*664] entitled to recover on both takings claims, affirmed the damages
award for the downzoning claim, and remanded the moratorium claim for trial on damages. 2 The court also
concluded that Sheffield's claim for declaratory relief was ripe and remanded it. 3 We hold that Sheffield cannot
recover on either takings claim and reverse and render judgment accordingly. We agree with the court of appeals
that the case must be remanded to the trial court to determine whether Sheffield fixed its rights by submitting a plat
during a hiatus in the moratorium.
I
A
The City of Glenn Heights is a growing suburban community (1990 pop. 4,564; 2000 pop. 8,050) south of Dallas
astraddle the Dallas/Ellis County border. [**3] In 1986, the City zoned a 236-acre tract as Planned Development
District 10 (PD 10), allowing most of it to be developed for single-family residences on lots no smaller than 6,500
square feet, with a maximum density of 5.5 dwelling units per acre. 4 The owner at the time platted and developed
the first phase of the Stone Creek subdivision on just over 43 acres of the tract. Some of the lots in the first phase
met only the minimum required sizeminimum-size, but others were larger. The rest of the property was not
developed and remained vacant.
In 1995, the City adopted a comprehensive "Future Land Use Plan" which found that the City had an oversupply of
high-density residential areas. The plan designated the neighborhood including Stone Creek primarily as a lower
density residential area to contain four to five dwelling units per acre. Though PD 10 zoning allowed a
1 TEX. CONST. art. I, § 17 HN1[ ] ("No person's property shall be taken, damaged or destroyed for or applied to public use
without adequate compensation being made . . . .").
2 61 S.W.3d 634, 45 Tex. Sup. Ct. J. 984 (Tex. App.--Waco 2001).
3 Id. at 660.
4 Relatively small portions around the perimeter were earmarked for lots of 7500 square feet, 9,000 square feet, and 10,000
square feet.
BARBARA QUIRK
EXHIBIT E
Page 10 of 25
140 S.W.3d 660, *664; 2004 Tex. LEXIS 195, **3
maximum [**4] of 5.5 dwelling units per acre in the relevant area, the first phase of the development had been built
with only 3.9 dwelling units per acre, the trial court found, and thus would comply with the new plan. The plan left
PD 10 zoning in place. Except for PD 10 and the thirteen other planned development districts (PDs), all property
within the City was rezoned according to the plan, increasing most residential lot sizes to 20,000 square feet
minimum. The City did not rezone any of the PDs at that time.
In the summer of 1996, Sheffield Development Co. contracted to purchase the undeveloped part of Stone Creek
including certain unbuilt lots in the first phase area, in all about 194 acres, for $ 600 an acre. The price was below
market because the owner, a firm headquartered in England, was anxious to liquidate its real estate portfolio in the
United States. Sheffield's principal, Gary Sheffield, was an experienced, successful developer of single-family
subdivisions. Before closing on the contract, he made a due-diligence investigation of all City regulations and
restrictions affecting the property. He met several times with the City Secretary, the City Manager, the Mayor, and
various Council [**5] members to advise them of Sheffield's plans to continue the Stone Creek development as
permitted by the PD 10 zoning and to ascertain that no zoning changes for the property were planned. He
specifically requested that Sheffield be notified of any possible zoning changes. No City officer or employee
expressed any objection or reservation to Sheffield's plans or stated that the PD 10 zoning might change, but
neither did anyone offer any assurance that the zoning would not change.
[*665] At the time, the Vested Rights Statute allowed a landowner to vest zoning rights by filing a plat. 5 Through
the fall of 1996, representatives of the City met to discuss downzoning PD 10 and imposing a moratorium on
development, but they did not tell Sheffield of these meetings for fear that it would quickly close on the purchase of
the property, file a plat, and vest its zoning rights. When Sheffield finally did close on the purchase of the property in
December, the City Council met three days later in executive session to discuss downzoning PD 10.
[**6] On January 6, 1997, without prior notice to Sheffield (the law that now requires four days' notice in such
circumstances 6 was not yet in effect), the City Council adopted Resolution No. 287-97 prohibiting the filing and
acceptance of plats in PDs until February 6 to allow time to determine whether existing PD zoning was consistent
with the comprehensive land use plan. The resolution recited:
the temporary suspension is solely for the purpose of allowing the City Council to study, in conjunction with the
City's planning and administrative officials, the zoning, growth and development related issues and concerns
presented by the nonconformity of the City's planned developments with the City's Code and Future Land Use
Plan.
Before the end of this moratorium, the City's consultant recommended that PD 10 be rezoned to require lots no
smaller than [**7] 12,000 square feet, thereby permitting construction of about half the number of houses permitted
by PD 10. The consultant also recommended that eleven other PDs be rezoned, leaving two that would not be
rezoned. The recommendation was referred to the City's Planning and Zoning Commission, and the City Council
extended the moratorium to March 6.
On March 11, after the moratorium had expired on its face, Sheffield submitted a plat for the development of its
property under PD 10 zoning requirements. The City Secretary rejected the plat on the asserted ground that the
City Manager had continued the moratorium in effect without Council action. On March 17, the City Council
extended the moratorium to May 6.
5 Actof May 24, 1995, 74th Leg., R.S., ch. 794, § 1, 1995 Tex. Gen. Laws 4147 (codified as TEX. GOV'T CODE §§ 481.141-
.143), "inadvertently" repealed by Act of June 1, 1997, 75th Leg., R.S., ch. 1041, § 51(b), 1997 Tex. Gen. Laws 3943, 3966, and
reenacted by Act of April 29, 1999, 76th Leg., R.S., ch. 73, §§ 1, 2 1999 Tex. Gen. Laws 431, 432 (at § 1, finding that statute
was "inadvertently repealed"), and now recodified as TEX. LOCAL GOV'T CODE §§ 245.001-.006.
6 TEX. LOC. GOV'T CODE §§ 212.134(b) (adopted by Act of May 15, 2001, 77th Leg., R.S., ch. 441, § 1 2001 Tex. Gen. Laws
863).
BARBARA QUIRK
EXHIBIT E
Page 11 of 25
140 S.W.3d 660, *665; 2004 Tex. LEXIS 195, **7
On March 24, the Planning and Zoning Commission accepted some of the consultant's recommendations for
rezoning twelve PDs but rejected the proposed rezoning of PD 10 and four other PDs. Anticipating that the City
Council would be unwilling to accept the Commission's decision yet unable to override it -- a three-fourths vote, or
six of the seven members, was required by the City charter -- the City Manager recommended that final action be
delayed. Accordingly, on April 21, the City Council [**8] rezoned three of the twelve PDs as recommended by the
consultant and approved by the Commission, and adopted Resolution No. 292-97, essentially identical to
Resolution 287-97, extending the moratorium to July 21. The City Council later extended the moratorium under the
same resolution to December 31 and finally to May 15, 1998. From July through December 1997, the City rezoned
another seven of the twelve PDs as recommended by the consultant, leaving [*666] PD 10 and one other on
which the City Council had not acted. At the same time, the City and Sheffield made some efforts to negotiate their
differences, but the City had no further studies done or reports made on whether PD 10 should be rezoned.
On April 27, 1998, the Planning and Zoning Commission voted to accept the consultant's January 1997
recommendation to rezone PD 10 and the remaining PD. The same day, the City Council approved the rezoning.
B
Sheffield sued the City for inverse condemnation, arguing that both the moratorium and the rezoning of the property
violated the takings provision of the Texas Constitution, article I, section 17. Sheffield also sought a declaratory
judgment that the plat it filed in March 1997, during [**9] the gap in the moratorium periods authorized by the City
Council, had been deemed approved by the City's failure to take action on it 7 and vested Sheffield's rights by
statute. Sheffield's pleadings did not assert the claim for declaratory judgment as an alternative to the claims for
damages. 8 Sheffield asserted a number of other claims against the City, which the trial court denied. Sheffield has
not appealed the trial court's rulings on those claims, and thus they do not concern us here.
The parties agreed to try liability issues to the court and damages, if necessary, to a jury. After the bench trial, the
court issued findings and conclusions that:
. Sheffield purchased the property expecting that it could be developed under PD 10 zoning, in good faith
reliance on the City's representations and the already substantial development of the Stone [**10] Creek
subdivision;
. the moratorium:
. "substantially advanced a legitimate governmental interest",
. "did not unreasonably interfere with Sheffield's rights to use and enjoy its property", and thus
. "did not constitute a taking without payment of just compensation";
. the rezoning:
. "substantially advanced a legitimate government interest", but
. "had a severe economic impact on Sheffield",
. "deprived Sheffield of its investment-backed expectations",
. "unreasonably interfered with Sheffield's rights to use and enjoy its property", and thus
. "constituted a taking without payment of just compensation under Article I, Sec. 17 of the Texas Constitution."
Although the trial court found that no moratorium was in effect from March 6 to 17, 1997, it concluded, without
explanation, that Sheffield's claim that its rights were vested by the plat it filed during that period was not ripe.
In both the bench trial and the subsequent jury trial, the parties offered evidence of the value of Sheffield's property
before and after the rezoning. Witnesses for Sheffield testified that the property was worth $ 12,000-$ 14,000/acre
($ 2,328,000 - $ 2,716,000) before the rezoning and [**11] $ 600/acre ($ 116,400) afterward, a reduction of 95% or
more. The City's appraiser testified that the property was worth only $ 4,000/acre ($ 776,000) before the rezoning
7 See TEX. LOC. GOV'T CODE § 212.009.
8 See 61 S.W.3d at 661 (Vance, J., concurring and dissenting).
BARBARA QUIRK
EXHIBIT E
Page 12 of 25
140 S.W.3d 660, *666; 2004 Tex. LEXIS 195, **11
and $ 2,500/acre ($ 485,000) afterward, a reduction of 37.5%. Although the trial court found after the bench trial that
the rezoning [*667] had had "a severe economic impact on Sheffield", it did not quantify that impact. The jury
found that the property was worth $ 970,000 ($ 5,000/acre) before rezoning and $ 485,000 ($ 2,500/acre) afterward,
a reduction of 50%. In accordance with its findings and the jury's verdict, the trial court rendered judgment awarding
Sheffield $ 485,000.
Both the City and Sheffield appealed. Sheffield argued that the moratorium also constituted a taking of its property,
and that its claim for declaratory judgment should not have been dismissed. The City argued that neither the
moratorium nor the rezoning was a taking of Sheffield's property.
Drawing from this Court's opinion in Mayhew v. Town of Sunnyvale, 9 [**13] the court of appeals stated that
Sheffield could establish a compensable regulatory taking if the rezoning or moratorium either (1) did not
substantially advance the City's legitimate [**12] interests, 10 (2) deprived Sheffield of all economically viable use
of its property, 11 or (3) unreasonably interfered with Sheffield's use of the property 12 as measured by the severity
of the economic impact on Sheffield and the extent to which its investment-backed expectations had been defeated.
13 The court held that the rezoning was not a taking under either of the first two tests. The court determined that
rezoning Sheffield's property substantially advanced the City's legitimate interest in "protecting the community from
the ill effects of urbanization" and "preserving the rate and character of community growth". 14 The court pointed to
the City's evidence that rezoning had reduced the estimated potential population of Stone Creek from 3,090 to
1,563, and that a less densely developed subdivision would mean "more open space and less traffic[,] . . . greater
setbacks, fewer school children, 'less folks, and less noise . . . .'" 15 The court also held that rezoning did not
deprive Sheffield of "all economically viable use" of its property, 16 based on Sheffield's admission that the property
was still worth $ 600 acre.
But the court concluded that the rezoning unreasonably interfered with Sheffield's use of its property. The court
believed that in determining the economic impact on Sheffield it could not consider the jury's finding in the trial on
damages but could look only to the evidence offered in the bench trial on liability issues, even though that evidence
was substantially the same as the evidence before the jury. The court reasoned that the minimum economic impact
on Sheffield was a 38% reduction in the value of its property, based on testimony the City itself had offered, and
concluded that such a reduction was "a sufficient adverse economic impact to satisfy the first factor of the
unreasonable interference test." 17 [**15] The court then evaluated Sheffield's investment-backed expectations.
The court noted that the PD 10 zoning was in place when [**14] Sheffield bought the property, that 43 acres of the
original tract had already been developed under that zoning, that continued development was consistent with the
City's 1995 comprehensive land use plan, and that before closing on the property Sheffield had attempted [*668]
9 964 S.W.2d 922, 41 Tex. Sup. Ct. J. 517 (Tex. 1998).
10 61 S.W.3d at 644, 645.
11 Id. at 644, 647.
12 Id. at 647.
13 Id. at 647-48.
14 Id. at 646.
15 Id.
16 Id. at 647.
17 Id. at 648.
BARBARA QUIRK
EXHIBIT E
Page 13 of 25
140 S.W.3d 660, *668; 2004 Tex. LEXIS 195, **14
to confirm its development plans in several meetings with City officials. 18 The court also cited evidence that there
was no existing market in Glenn Heights for larger homes and lots, that the highest and best use of the property
was to hold it until such a market developed, and that Sheffield had lost anticipated profits of over $ 8 million. 19 The
court noted that development under PD 10 zoning would not burden city services because the infrastructure for the
development had long been in place. 20 The court recognized that no one fact could determine its inquiry, but
concluded, based on all of the circumstances, that the rezoning "unreasonably interfered with Sheffield's
investment-backed expectations." 21 Accordingly, the court held that the rezoning "unreasonably interfered with
Sheffield's right to use and enjoy the property." 22
Turning to the moratorium, the court disagreed with the trial court that the moratorium substantially advanced the
City's legitimate interests for the entire period it was in effect. 23 The court noted that the City's stated purpose for
the moratorium -- to study whether PD 10 and other planned development areas should be rezoned -- was
completed when the City's consultant tendered his report and recommendations less than a month after the
moratorium was first put in place. 24 Yet the moratorium was extended and re-extended a total of fifteen months
(excluding the twelve-day gap found by the trial court). The court of appeals cited testimony by the Mayor and one
Councilman that the moratorium was extended because of a stalemate on the Council and in order to pressure
Sheffield into accepting the City's development conditions. 25 The Mayor testified that one Councilman "had
expressed his concern that the City did not have [**16] enough leverage, as he likes to put it, over the developer".
26 From the evidence, the court concluded that "the motivation for the moratorium was never simply to study the
zoning issue." 27 "Once the city had all the information it needed to make a decision," the court concluded, "the
stalemate on the council [over whether to reject the Planning and Zoning Commission's decision not to rezone PD
10 and four other PDs] was not a legitimate reason to continue the moratorium which prevented development of the
property". 28 Thus, the court held that the moratorium was a compensable taking of Sheffield's property beginning
with the Council's stalemate on April 21, 1997. 29
Finally, the court also disagreed with the trial court's dismissal of Sheffield's claim for a declaratory judgment [**17]
as not ripe. Rather, the court of appeals concluded, "nothing else . . . can occur that will affect Sheffield's
entitlement to a determination of" whether it had filed a plat vesting its development rights during a gap in the
18 Id. at 650.
19 Id. at 650-51.
20 Id. at 651.
21 Id. at 652.
22 Id.
23 Id. at 657.
24 Id. at 655.
25 Id. at 655-56.
26 Id. at 656.
27 Id. at 657.
28 Id.
29 Id.
BARBARA QUIRK
EXHIBIT E
Page 14 of 25
140 S.W.3d 660, *668; 2004 Tex. LEXIS 195, **17
moratorium. 30 Accordingly, the court affirmed the judgment for damages for the rezoning and remanded the case
[*669] for a determination of damages for the moratorium and of Sheffield's claim for declaratory relief. 31 As the
dissent noted, however, the court gave no guidance on whether Sheffield could "prevail on approval of the plat
(thereby gaining the right to develop the property under the former zoning) and recover damages for the moratorium
and re-zoning". 32
We granted both parties' petitions for review. 33
[**18] II
We first consider Sheffield's claims that the rezoning and moratorium each effected a taking of its property without
adequate compensation in violation of article I, section 17 of the Texas Constitution. Sheffield makes no claim
under HN2[ ] the Takings Clause of the Fifth Amendment to the United States Constitution, which is made
applicable to the states through the Fourteenth Amendment. 34 The two guarantees, though comparable, are
worded differently. [**19] HN3[ ] The Texas Constitution provides that "no person's property shall be taken,
damaged or destroyed for or applied to public use without adequate compensation being made . . . ." 35 HN4[ ]
The Takings Clause of the Fifth Amendment states: "nor shall private property be taken for public use without just
compensation." 36 As the court of appeals noted, it could be argued that the differences in the wording of the two
provisions are significant, but neither Sheffield nor the City makes this argument. 37 Both agree that in applying the
Texas constitutional provision in this case, we should look to federal jurisprudence for guidance, as we have in the
past, 38 and so we do.
[**20] A
30 Id. at 658.
31 Id. at 660.
32 Id. at 661 (Vance, J., concurring and dissenting).
33 61 S.W.3d 634, 45 Tex. Sup. Ct. J. 984 (July 3, 2002).
34 Tahoe-Sierra Pres. Council, Inc. v. Tahoe Reg'l Planning Agency, 535 U.S. 302, 306 n.1, 152 L. Ed. 2d 517, 122 S. Ct. 1465
(2002) (citing Chicago, B.& Q. R.R. Co. v. Chicago, 166 U.S. 226, 239, 241, 41 L. Ed. 979, 17 S. Ct. 581 (1897)); Mayhew v.
Town of Sunnyvale, 964 S.W.2d 922, 933, 41 Tex. Sup. Ct. J. 517 (Tex. 1998) (also citing Chicago, B.& Q. R.R. Co.).
35 TEX. CONST. art. I, § 17.
36 U.S. CONST. amend. V.
37 61 S.W.3d at 642-44. See DuPuy v. City of Waco, 396 S.W.2d 103, 108, 9 Tex. Sup. Ct. J. 42 (Tex. 1965) ("It was the injustice
of requiring an actual [physical] taking which explains the inclusion for the first time in the Constitution of 1876 of the requirement
that compensation be paid for the damaging of property for public use."); Trinity & S. Ry. Co. v. Meadows, 73 Tex. 32, 11 S.W.
145, 146 (Tex. 1889) ("The insertion of the words 'damaged or destroyed' in [article I, section 17] was doubtless intended to
obviate this question [of whether a compensable taking required a physical appropriation], and to afford protection to the owner
of property, by allowing him compensation, when by the construction of a public work his property was directly damaged or
destroyed, although no part of it was actually appropriated.").
38 E.g.,
City of Austin v. Travis County Landfill Co., 73 S.W.3d 234, 238-39, 45 Tex. Sup. Ct. J. 511 (Tex. 2002); Mayhew v.
Town of Sunnyvale, 964 S.W.2d 922, 932, 41 Tex. Sup. Ct. J. 517 (Tex. 1982).
BARBARA QUIRK
EXHIBIT E
Page 15 of 25
140 S.W.3d 660, *669; 2004 Tex. LEXIS 195, **20
HN5[ ] By their plain terms, the takings provisions of the state and federal constitutions do not limit the
government's power to take private property for public use but instead require that a taking be compensated. 39
Physical possession is, categorically, a taking for which compensation is [*670] constitutionally mandated,
40 [**22] but a restriction in the permissible uses of property or a diminution in its value, resulting from regulatory
action within the government's police power, may or may not be a compensable taking. 41 As we have said, "all
property is held subject to the valid exercise of the police power" and thus not every regulation is a compensable
taking, although some are. 42
There is . . . no one test and no single sentence rule . . . . The need to adjust the conflicts between private
ownership of property and the public's interests is a very old one which has produced no single solution. 43
"Government hardly could go on", wrote Justice Holmes in the first regulatory takings case in the United States
Supreme Court, "if to some extent values incident to property could not be diminished [by government regulation]
without paying for every such change in the general [**21] law." 44 Yet, he continued, "a strong public desire to
improve the public condition is not enough to warrant achieving the desire by a shorter cut than the constitutional
way of paying for the change." 45 HN6[ ] "The general rule at least", he concluded, is "that while property may be
regulated to a certain extent, if regulation goes too far it will be recognized as a taking", 46 adding, "this is a
question of degree -- and therefore cannot be disposed of by general propositions." 47 "The question at bottom is
upon whom the loss of the changes desired should fall." 48
While the United States Supreme Court has never questioned this rule since Justice Holmes stated it, 49 [**24]
HN7[ ] the Court has acknowledged that determining how far is "too far"
39 See First English Evangelical Lutheran Church of Glendale v. County of Los Angeles, 482 U.S. 304, 314, 96 L. Ed. 2d 250,
107 S. Ct. 2378 (1987) ("As its language indicates, and as the Court has frequently noted, this provision does not prohibit the
taking of private property, but instead places a condition on the exercise of that power.") (citations omitted).
40 Tahoe-Sierra Pres. Council, Inc. v. Tahoe Reg'l Planning Agency, 535 U.S. 302, 322, 152 L. Ed. 2d 517, 122 S. Ct. 1465
(2002) ("When the government physically takes possession of an interest in property for some public purpose, it has a
categorical duty to compensate the former owner . . . .").
41 Taub v. City of Deer Park, 882 S.W.2d 824, 826, 37 Tex. Sup. Ct. J. 1079 (Tex. 1994) ("An act short of actual physical
invasion, appropriation, or occupation can amount to a compensable taking when a governmental agency has imposed
restrictions that constitute an unreasonable interference with the landowner's right to use and enjoy the property.")(citation
omitted).
42 City of College Station v. Turtle Rock Corp., 680 S.W.2d 802, 804, 28 Tex. Sup. Ct. J. 104 (Tex. 1984).
43 Id. (quoting City of Austin v. Teague, 570 S.W.2d 389, 392, 21 Tex. Sup. Ct. J. 534 (Tex. 1978)).
44 Pennsylvania Coal Co. v. Mahon, 260 U.S. 393, 413, 67 L. Ed. 322, 43 S. Ct. 158 (1922).
45 Id. at 416.
46 Id. at 415.
47 Id. at 416.
48 Id. (emphasis added).
49 See, e.g., First English Evangelical Lutheran Church of Glendale v. County of Los Angeles, 482 U.S. 304, 328, 96 L. Ed. 2d
250, 107 S. Ct. 2378 (1987) ("There is no dispute about the proposition that a regulation which goes 'too far' must be deemed a
taking.").
BARBARA QUIRK
EXHIBIT E
Page 16 of 25
140 S.W.3d 660, *670; 2004 Tex. LEXIS 195, **24
has proved to be a problem of considerable difficulty. While this Court has recognized that the "Fifth
Amendment's [**23] guarantee . . . [is] designed to bar Government from forcing some people alone to bear
public burdens which, in all fairness and justice, should be borne by the public as a whole," this Court, quite
simply, has been unable to develop any "set formula" for determining when "justice and fairness" require that
economic injuries caused by public action be compensated by the government, rather than remain
disproportionately concentrated on a few persons. Indeed, we have frequently observed that whether a
particular restriction will be rendered invalid by the government's failure to [*671] pay for any losses
proximately caused by it depends largely "upon the particular circumstances [in that] case." 50
As a result, the Supreme Court has admitted, "cases attempting to decide when a regulation becomes a taking are
among the most litigated and perplexing in current law." 51 For our part, we have called these legal battlefields "a
'sophistic Miltonian Serbonian Bog'". 52
There are small islands in the bog. HN8[ ] The Supreme Court has identified, in its words, "at least two discrete
categories of regulatory action as compensable without case-specific inquiry". 53 One is where regulation "compels
the property owner to suffer a physical 'invasion' of his property." 54 The direct, physical effect on property, though
short of government possession, makes the regulation [**25] categorically a taking. Another is "where regulation
denies all economically beneficial or productive use of land." 55 To deprive an owner of all economically beneficial
use of land is tantamount to depriving him of the land itself. [**26] But this is "limited to 'the extraordinary
circumstance when no productive or economically beneficial use of land is permitted'" 56 and "the landowner is left
with a token interest." 57 In addition to these two situations, the Supreme Court has stated that regulation "effects a
taking if [it] does not substantially advance legitimate state interests". 58
50 Penn Cent. Transp. Co. v. City of New York, 438 U.S. 104, 123-24, 57 L. Ed. 2d 631, 98 S. Ct. 2646 (1978) (alteration in
original) (citations omitted).
51 Eastern Enters. v. Apfel, 524 U.S. 498, 541, 141 L. Ed. 2d 451, 118 S. Ct. 2131 (1998).
52 Cityof Austin v. Teague, 570 S.W.2d 389, 391, 21 Tex. Sup. Ct. J. 534 (Tex. 1978) (quoting Brazos River Auth. v. City of
Graham, 163 Tex. 167, 354 S.W.2d 99, 105, 5 Tex. Sup. Ct. J. 12 (Tex. 1962)); see also JOHN MILTON, PARADISE LOST
49, bk. II, ll. 592-94 (Scott Elledge ed., Norton & Co. 1993)(1674)(describing the land beyond Lethe as "A gulf profound as that
Serbonian bog / Betwixt Damiata and Mount Casius old, / Where armies whole have sunk").
53 Lucas v. S.C. Coastal Council, 505 U.S. 1003, 1016, 120 L. Ed. 2d 798, 112 S. Ct. 2886 (1992).
54 Id.(citing Loretto v. Teleprompter Manhattan CATV Corp., 458 U.S. 419, 435-40, 73 L. Ed. 2d 868, 102 S. Ct. 3164 (1982))
(holding that "law requiring landlords to allow television cable companies to emplace cable facilities in their apartment buildings
constituted a taking").
55 Id.
at 1015-16 (citing Agins v. City of Tiburon, 447 U.S. 255, 260, 65 L. Ed. 2d 106, 100 S. Ct. 2138 (1980)); see also Mayhew
v. Town of Sunnyvale, 964 S.W.2d 922, 933, 41 Tex. Sup. Ct. J. 517 (Tex. 1998).
56 Tahoe-Sierra Pres. Council, Inc., v. Tahoe Reg'l Planning Agency, 535 U.S. 302, 330, 152 L. Ed. 2d 517, 122 S. Ct. 1465
(2002) (quoting Lucas, 505 U.S. at 1017-19); see also Mayhew, 964 S.W.2d at 935. But see Lucas, 505 U.S. at 1016 n.7
("Regrettably, the rhetorical force of our 'deprivation of all economically feasible use' rule is greater than its precision, since the
rule does not make clear the 'property interest' against which the loss of value is to be measured. When, for example, a
regulation requires a developer to leave 90% of a rural tract in its natural state, it is unclear whether we would analyze the
situation as one in which the owner has been deprived of all economically beneficial use of the burdened portion of the tract, or
as one in which the owner has suffered a mere diminution in value of the tract as a whole.").
57 Palazzolov. Rhode Island, 533 U.S. 606, 631, 150 L. Ed. 2d 592, 121 S. Ct. 2448 (2001); cf. Tahoe-Sierra, 535 U.S. at 350
(Rehnquist, C.J., dissenting) (arguing that economically beneficial use in Lucas is not synonymous with value).
58 Agins, 447 U.S. at 260 (1980) citation omitted); see also Mayhew, 964 S.W.2d at 933-34.
BARBARA QUIRK
EXHIBIT E
Page 17 of 25
140 S.W.3d 660, *671; 2004 Tex. LEXIS 195, **26
[**27] Otherwise, however, whether regulation has gone "too far" and become [*672] too much like a physical
taking for which the constitution requires compensation requires a careful analysis of how the regulation affects the
balance between the public's interest and that of private landowners. While each case must therefore turn on its
facts, guiding considerations can be identified, as the Supreme Court first explained in Penn Central Transportation
Co. v. City of New York:
HN9[ ] In engaging in these essentially ad hoc, factual inquiries, the Court's decisions have identified several
factors that have particular significance. The economic impact of the regulation on the claimant and,
particularly, the extent to which the regulation has interfered with distinct investment-backed expectations are,
of course, relevant considerations. So, too, is the character of the governmental action. A "taking" may more
readily be found when the interference with property can be characterized as a physical invasion by
government, than when interference arises from some public program adjusting the benefits and burdens of
economic life to promote the common good. 59
[**28] The Supreme Court has restated these factors simply as:
HN10[ ] (1) "the economic impact of the regulation on the claimant"; (2) "the extent to which the regulation
has interfered with distinct investment-backed expectations"; and (3) "the character of the governmental
action." 60
Nevertheless, the Supreme Court has cautioned that these factors do not comprise a formulaic test.
"Penn Central does not supply mathematically precise variables, but instead provides important guideposts
that lead to the ultimate determination whether just compensation is required." "The temptation to adopt what
amount to per se rules in either direction must be resisted." 61
Thus, for example, the economic impact of a regulation may indicate a taking even if the landowner has not been
deprived of all economically [**29] beneficial use of his property. Nor are the three Penn Central factors the only
ones relevant in determining whether the burden of regulation ought "in all fairness and justice" to be borne by the
public. 62 HN11[ ] Whether a regulatory taking has occurred, the Supreme Court has said, "depends on a complex
of factors including" the three set out in Penn Central. 63 The analysis "necessarily requires a weighing of private
and public interests" 64 and a "careful examination and weighing of all the relevant circumstances in this context." 65
As we have ourselves said of regulatory takings issues, "we consider all of the surrounding circumstances" 66 in
applying [*673] "a fact-sensitive test of reasonableness". 67 [**31]
59 438 U.S. 104, 124, 57 L. Ed. 2d 631, 98 S. Ct. 2646 (1978) (citations omitted).
60 Connollyv. Pension Benefits Guar. Corp., 475 U.S. 211, 225, 89 L. Ed. 2d 166, 106 S. Ct. 1018 (1986) (quoting Penn Cent.
Transp. Co. v. City of New York, 438 U.S. at 124).
61 Tahoe-Sierra, 535 U.S. at 326-27 n.23 (citations omitted) (quoting Palazzolo, 533 U.S. at 634, 636 (O'Connor, J., concurring)).
62 See,e.g., City of Austin v. Teague, 570 S.W.2d 389, 393, 21 Tex. Sup. Ct. J. 534 (Tex. 1978) ("There is still another test
which is sometimes helpful. It allows recovery of damages when the government's action against an economic interest of an
owner is for its own advantage.").
63 Palazzolo, 533 U.S. at 617 (emphasis added).
64 Agins v. City of Tiburon, 447 U.S. 255, 261, 65 L. Ed. 2d 106, 100 S. Ct. 2138 (1980).
65 Tahoe-Sierra, 535 U.S. at 326 n.23 (quoting Palazzolo, 533 U.S. at 636 (O'Connor, J., concurring)).
66 Mayhew v. Town of Sunnyvale, 964 S.W.2d 922, 933, 41 Tex. Sup. Ct. J. 517 (Tex. 1998).
BARBARA QUIRK
EXHIBIT E
Page 18 of 25
140 S.W.3d 660, *673; 2004 Tex. LEXIS 195, **31
We have said that HN12[ ] while
determining whether a property regulation is unconstitutional requires the consideration of a number of factual
issues, the ultimate question of whether a zoning ordinance constitutes a compensable taking or violates due
process or equal protection is a question of law, not a question of fact. In resolving this legal issue, we consider
all of the surrounding circumstances. HN13[ ] While we depend on the district court to resolve disputed facts
regarding [**30] the extent of the governmental intrusion on the property, the ultimate determination of whether
the facts are sufficient to constitute a taking is a question of law. 68
We apply this standard to the record before us.
B
We come, then, to whether the rezoning of Sheffield's property was a taking. There was no physical invasion of the
property, and Sheffield does not argue that it was deprived of all economically beneficial use of the property.
Sheffield argues that the rezoning was a taking because it did not substantially advance the City's legitimate
governmental interests, and because it went too far in restricting Sheffield's use and enjoyment of its property. We
consider each argument in turn.
1
a
As a threshold matter, the City argues that a regulation should not be considered a taking merely because it does
not substantially advance legitimate state interests. The United States Supreme Court flatly stated in Agins v. City
of Tiburon that HN14[ ] "the application of a general zoning law to particular property effects a taking if the
ordinance does not substantially advance legitimate state interests". 69 We agreed with that statement in Mayhew v.
City of Sunnyvale and used it in applying the takings provision in the Texas Constitution. [**32] 70 But the City
argues that the Supreme Court has receded from its statement in Agins, and so should we in applying the Texas
Constitution. Whether a regulation furthers a legitimate purpose, the City argues, is really a due process concern
and not a test for determining whether the government must compensate a taking of property. Furthermore, the City
argues, requiring compensation for a regulation merely because it does not advance state interests and therefore
does not benefit the public, unfairly burdens taxpayers by requiring them to pay for something from which they did
not benefit.
It is true, as the City says, that the Supreme Court appears to have equivocated somewhat on its statement in
Agins outside the context of cases involving required dedications or exactions. In City of Monterey v. Del Monte
Dunes at Monterey, Ltd., the trial court had instructed the jury that [**33] a city's refusal to allow development of
property would constitute a taking if "there was no reasonable relationship between the city's denial of the . . .
proposal and legitimate public purpose". 71 [*674] The Court said that although it had never provided
67 City of College Station v. Turtle Rock Corp., 680 S.W.2d 802, 804, 28 Tex. Sup. Ct. J. 104 (Tex. 1984).
68 Mayhew, 964 S.W.2d at 932-33.
69 447 U.S. at 260 (citation omitted).
70 964 S.W.2d at 933-34 (quoting Appendix at 304).
71 526 U.S. 687, 701, 143 L. Ed. 2d 882, 119 S. Ct. 1624 (1999).
BARBARA QUIRK
EXHIBIT E
Page 19 of 25
140 S.W.3d 660, *674; 2004 Tex. LEXIS 195, **33
a thorough explanation of the nature or applicability of the requirement that a regulation substantially advance
legitimate public interests outside the context of required dedications or exactions, we note that the trial court's
instructions are consistent with our previous general discussions of regulatory takings liability. 72
"Consistent" does not, of course, equal correct, a fact made all the more noticeable by five Justices' expressly
withholding opinion on whether Agins' substantial advancement requirement is a proper takings test. 73 [**34] But
since Del Monte Dunes, the Supreme Court has cited the substantial advancement test without criticism, 74 as it
had done several times earlier. 75
Whatever may be made of all of this, one thing is clear: the Supreme Court has never modified or retracted its
statement in Agins. HN15[ ] Prior decisions need not be reaffirmed periodically to retain authority. As the Supreme
Court has admonished:
HN16[ ] "if a precedent [**35] of [the Supreme] Court has direct application in a case, yet appears to rest on
reasons rejected in some other line of decisions, [a lower court] should follow the case which directly controls,
leaving to [the Supreme] Court the prerogative of overruling its own decisions." 76
We are not, of course, bound to follow Agins in this case since Sheffield makes no claim under the United State
Constitution, but as we have already said, HN17[ ] we do look to federal takings cases for guidance in applying
our own constitution. To that end, we conclude that Agins remains authoritative.
Furthermore, apart from what the Supreme Court has said, we continue to believe for purposes of state
constitutional law, as we held in Mayhew, that the statement in Agins is correct: that HN18[ ] whether regulation
substantially advances legitimate state interests is an appropriate test for a constitutionally compensable taking, at
least [**36] in some situations. In this case, for example, Sheffield argues that the City did not rezone Stone Creek
for any legitimate purpose, such as to avoid the ill effects of urbanization and provide for orderly development, but
simply to muscle Sheffield into modifying its development proposals or going away altogether. If Sheffield were
correct, we think the lack of a legitimate purpose alone would make the rezoning a taking, just as it would have in
Mayhew. The City equates a lack of legitimate purpose with a lack of public purpose, [*675] the latter being a
prerequisite to any taking. 77 Without a public purpose, the City reasons, there is no public benefit, and the public
should not be required by the substantial advancement test to pay for government action from which it has received
no benefit. But the flaw is in the equation. HN19[ ] Government action may be for a public -- as opposed to a
private -- purpose, even if that purpose is not a legitimate one for the government to engage in. For instance, as the
72 Id. at 704 (citation omitted).
73 Id.
at 732 n.2 (Scalia, J., concurring in part and concurring in the judgment); id. at 753 n.12 (Souter, J., joined by O'Connor,
Ginsburg, and Breyer, JJ., concurring in part and dissenting in part).
74 Tahoe-Sierra Pres. Council, Inc., v. Tahoe Reg'l Planning Agency, 535 U.S. 302, 323-24, 152 L. Ed. 2d 517, 122 S. Ct. 1465
(2002) ("For the same reason that we do not ask whether a physical appropriation advances a substantial government interest or
whether it deprives the owner of all economically valuable use, we do not apply our precedent from the physical takings context
to regulatory takings claims.").
75 Lucas v. S.C. Coastal Council, 505 U.S. 1003, 1016, 120 L. Ed. 2d 798, 112 S. Ct. 2886 (1992) ("As we have said on
numerous occasions, the Fifth Amendment is violated when land-use regulation 'does not substantially advance legitimate
state interests or denies an owner economically viable use of his land.' ") (quoting Agins, 447 U.S. at 260) (alteration in the
original) (citations omitted)).
76 Agostini v. Felton, 521 U.S. 203, 237, 138 L. Ed. 2d 391, 117 S. Ct. 1997 (1997).
77 Marrs v. R.R. Comm'n, 142 Tex. 293, 177 S.W.2d 941, 949 (Tex. 1944) ("'one person's property may not be taken for the
benefit of another private person without a justifying public purpose, even though compensation be paid'") (quoting Thompson v.
Consol. Gas Co., 300 U.S. 55, 80, 81 L. Ed. 510, 57 S. Ct. 364 (1936)).
BARBARA QUIRK
EXHIBIT E
Page 20 of 25
140 S.W.3d 660, *675; 2004 Tex. LEXIS 195, **36
Supreme Court has held, "the government may not require a person to give up a constitutional right . . . in
exchange for a discretionary benefit conferred by the government where [**37] the benefit sought has little or no
relationship to the property." 78 Sheffield argues, not that the City's purposes were not public, but that they were not
legitimate. If Sheffield is correct and the rezoning was therefore a taking, the benefit to the taxpayers would be that
of the City's having achieved its goal.
Accordingly, we decline the City's invitation to reject the substantial advancement test for compensable takings
stated in Agins and Mayhew.
b
The trial court concluded that the rezoning of PD 10 substantially advanced a legitimate governmental purpose,
[**38] and the court of appeals agreed. Sheffield argues that the assessment of the relationship between the City's
actions and legitimate governmental purposes must be confined to the record of events, documents, and meetings
leading up to the rezoning -- the "legislative record" -- and cannot consider, as the court of appeals did, post hoc
arguments made by the City in the course of this litigation. Sheffield also argues that the court of appeals was too
deferential to the City in assessing its purposes because the rezoning was not generally applicable but was aimed
directly at Sheffield. Finally, Sheffield argues that by any standard, the rezoning was a taking under the substantial
advancement test.
Sheffield cites no authority for its argument that the test must be limited to a "legislative record" of statements,
positions, or findings by the City prior to the rezoning, and we have found none. While Sheffield correctly points out
that the city commission in Mayhew gave reasons for its actions at the time they were taken, 79 we considered not
only those reasons but evidence later offered in litigation. 80 HN20[ ] For equal protection purposes, government
action has a rational basis [**39] if one can be conceived, regardless of whether the government had it in mind
when it took the action complained of. 81 Sheffield does not explain why the basis for takings analysis should be
more constricted, and we know of no reason. The court of appeals did not err in looking to the City's evidence and
arguments to assess its purposes.
Sheffield does not argue that the government must always be held to a heightened standard of judicial review when
its purposes are assessed in a takings context, but only that a heightened [*676] standard is appropriate when the
government has targeted a particular landowner or piece of property. As authority, Sheffield cites the Supreme
Court's decision in Nollan v. California Coastal Commission, which held that conditioning a home rebuilding permit
on the owners' conveyance of a public easement [**40] across their beachfront property was a compensable
taking. 82 The Supreme Court explained:
HN21[ ] our cases describe the condition for abridgement of property rights through the police power as a
"substantial advancing" of a legitimate state interest. We are inclined to be particularly careful about the
adjective where the actual conveyance of property is made a condition to the lifting of a land-use restriction,
since in that context there is heightened risk that the purpose is avoidance of the compensation requirement,
rather than the stated police-power objective. 83
78 Dolan v. City of Tigard, 512 U.S. 374, 385, 129 L. Ed. 2d 304, 114 S. Ct. 2309 (1994).
79 Mayhew v. Town of Sunnyvale, 964 S.W.2d 922, 935, 41 Tex. Sup. Ct. J. 517 (Tex. 1998).
80 Id.
81 Owens Corning v. Carter, 997 S.W.2d 560, 581, 42 Tex. Sup. Ct. J. 883 (Tex. 1999).
82 483 U.S. 825, 839, 97 L. Ed. 2d 677, 107 S. Ct. 3141 (1987).
83 Id. at 841 (alteration in the original).
BARBARA QUIRK
EXHIBIT E
Page 21 of 25
140 S.W.3d 660, *676; 2004 Tex. LEXIS 195, **40
We agree, but we read "particularly careful" to mean, not that HN22[ ] an elevated standard of review must be
applied, but that it ordinarily is, and should be, harder for the government to show that its interests have been
substantially advanced by regulation directed at one lone landowner. Moreover, the record does not support
Sheffield's argument that it was singled out. Eventually, the City's downzoning of residential property was virtually
city-wide, affecting non-PD property and most of the PDs. It was certainly not restricted to PD 10. In determining
whether the rezoning substantially advanced the City's [**41] legitimate purposes, the court of appeals was not, we
think, unduly deferential.
The court of appeals concluded that the City's rezoning substantially advanced its interests in avoiding the ill effects
of urbanization and preserving the rate and character of community growth. 84 The court pointed to evidence that
the downzoning would reduce the potential population and eventually result in more open space, less traffic, greater
setbacks, and fewer school children, although the court also noted that roads, schools, and utilities had all been
designed to accommodate original population estimates. 85 Sheffield argues that the most the evidence shows is
that rezoning could theoretically advance the City's legitimate purposes, and that is not enough. We agree that
HN23[ ] the substantial advancement requirement must be, in the Supreme Court's words, "more than a pleading
requirement, and compliance with it . . . more than an exercise in cleverness and imagination." 86 But we do not
think it must be proved to a certainty. Indeed, the actual effects of the City's rezoning are for the future and can only
be projected and estimated. The City offered evidence that rezoning the PDs would lower [**42] its potential
population by about 6,000, from about 31,000 to 25,000, and that rezoning PD 10 accounted for about one-fourth of
this reduction. The City could reasonably conclude that this would substantially advance its legitimate interest in
preserving a smaller community environment. Also, the City's concern with its growth first arose in 1995 and thus
was not prompted by Sheffield's acquisition of Stone Creek, even though Sheffield's imminent development plans
clearly stirred the City's anxiety. Thus, while the evidence establishes that from the fall of 1996 on, the City had its
eye on Sheffield all during the rezoning efforts, the Stone Creek subdivision was not the City's only [*677] focus,
and its efforts were not so narrowly directed at Sheffield alone as to indicate that the City's legitimate interests in
controlled growth had taken a back seat.
[**43] On balance, we agree with the lower courts that the City's rezoning substantially advanced legitimate
government interests.
2
Even so, we must consider whether the City went so far in restricting Sheffield's use of its property that the rezoning
was more like a taking and "in all fairness and justice", the burden of that restriction should be borne by the public.
We begin with the three Penn Central factors, mindful as we do that our analysis cannot be merely mathematical.
First, as the lower courts concluded, the rezoning clearly had a severe economic impact on Sheffield. By the City's
own evidence, the rezoning reduced the value of Sheffield's property by 37.5%, below what it was when Sheffield
purchased it, although not below the bargain price Sheffield paid. The jury found that the value of the property had
been reduced by half, but that it was still worth more than four times what Sheffield paid for it. From Sheffield's
perspective as a developer, the economic impact of the rezoning included more than $ 8 million in lost profits from
the planned development. There was no existing market for the larger lots required by the rezoning, and the
evidence was disputed whether [**44] one would ever develop. The City argues that evidence of lost profits should
be ignored, but we agree with the court of appeals that HN24[ ] lost profits are clearly one relevant factor to
consider in assessing the value of property and the severity of the economic impact of rezoning on a landowner. It
must be kept in mind, however, that
84 61 S.W.3d at 646.
85 Id.
86 Nollan, 483 U.S. at 841.
BARBARA QUIRK
EXHIBIT E
Page 22 of 25
140 S.W.3d 660, *677; 2004 Tex. LEXIS 195, **44
HN25[ ] the takings clause . . . does not charge the government with guaranteeing the profitability of every piece
of land subject to its authority. Purchasing and developing real estate carries with it certain financial risks, and it is
not the government's duty to underwrite this risk as an extension of obligations under the takings clause. 87
But while the impact of rezoning on Sheffield was unquestionably severe, it did not approach a taking. The court of
appeals focused on the diminution in the value of Sheffield's property, nearly 38% by the testimony of the City's
expert. We think the relevant number [**45] is 50%, as found by the jury. But HN26[ ] diminution in value is not
the only, or in this case even the principal, element to be considered. It is more important that, according to the jury
verdict, the property was still worth four times what it cost, despite the rezoning, because this makes the impact of
the rezoning very unlike a taking. Sheffield argues that its business acumen or good fortune in acquiring the
property cannot be considered in assessing the economic impact of rezoning, but we think that investment profits,
like lost development profits, must be included in the analysis.
Second, again as the lower courts concluded, the rezoning significantly interfered with Sheffield's reasonable,
investment-backed expectations. Sheffield's expectations were certainly reasonable. The PD 10 zoning had been in
place for ten years before Sheffield acquired the property, and part of the subdivision had already been developed
under that zoning scheme consistent with the City's comprehensive land use plan. 88 [**47] Moreover, [*678]
Sheffield's expectations were not merely those of any landowner, or even those of any developer; rather, Sheffield's
expectations were based in large part, and legitimately so, [**46] on its efforts to deal with the City. Sheffield met
with city officials to present his plans for development and inquire about any contemplated zoning changes, and as
the trial court found, its reliance on representations made in those meetings was in good faith. Although no City
employee ever promised Sheffield that there would be no change in zoning (nor would any such promise have
bound the City 89), it is fair to say that the moratorium and rezoning blindsided Sheffield, just as the City intended.
Evidence of Sheffield's dealings with the City is not, as the City argues, an improper basis to estop the City, but
proof of the reasonableness of Sheffield's expectations. However, it must also be said that the investment backing
Sheffield's expectations at the time of rezoning -- the $ 600/acre purchase price and the expenses of exploring
development with the City -- was minimal, a small fraction of the investment that would be required for full
development. And as with most development property, Sheffield's investment was also speculative, 90 as evidenced
by the fact that the property Sheffield acquired had not been developed in the ten years since it was first zoned PD
10.
Third, the rezoning, as we have already explained, was general in character and not exclusively directed at
Sheffield. This case is not like [**48] Nollan, for example, where an easement was exacted from a single
landowner for a rebuilding permit. Zoning changes are to be expected, especially in growing communities like Glenn
Heights. The rezoning here was typical of such changes.
Beyond the three Penn Central factors, we are concerned, as we have already indicated, about the City's conduct.
The evidence is quite strong that the City attempted to take unfair advantage of Sheffield, and quite lacking in any
87 Taub v. City of Deer Park, 882 S.W.2d 824, 826, 37 Tex. Sup. Ct. J. 1079 (Tex. 1994).
88 See Mayhew v. Town of Sunnyvale, 964 S.W.2d 922, 936, 41 Tex. Sup. Ct. J. 517 (Tex. 1998) ("Knowledge of existing zoning
is to be considered in determining whether the regulation interferes with investment-backed expectations.").
89 See, e.g., City of Pharr v. Pena, 853 S.W.2d 56, 62 (Tex. App.--Corpus Christi 1993, writ denied) ("statements or assurances
regarding zoning made by individual members of the city council, board or commission are not binding and do not give private
property owners a vested right to the use or disposal of their property so as to deny the city the exercise of its police power");
Alamo Carriage Serv., Inc. v. City of San Antonio, 768 S.W.2d 937, 941-42 (Tex. App.----San Antonio 1989, no writ)
("Statements of individual council members are not binding on the City."); City of Farmers Branch v. Hawnco, Inc., 435 S.W.2d
288, 292 (Tex. Civ. App.--Dallas 1968, writ ref'd n.r.e.) ("[assurances regarding continued zoning] by individual members of a
council or board are not binding on a governmental body which may act only in its official capacity").
90 See Taub, 882 S.W.2d at 826.
BARBARA QUIRK
EXHIBIT E
Page 23 of 25
140 S.W.3d 660, *678; 2004 Tex. LEXIS 195, **48
indication of unfair action on Sheffield's part. The City, fearful that we might consider the improvident statements of
individual officials and employees, argues that HN27[ ] the actions and motives of those individuals are not those
of the City itself. Of course, we agree. 91 But it is exactly the City's conduct, not that of its officials [*679] and
employees, that is so troubling. The City did not rezone or impose a moratorium on development, or indicate that it
had the remotest intention of doing so, until Sheffield closed on the purchase of the property. The moratorium it
imposed was for the purpose of "study", which was unquestionably completed within a month. Yet for a year the
City Council delayed action on the Planning and [**49] Zoning Commission's decision that PD 10 not be rezoned.
According to the City's own records, a reason for the delay was to muster the votes to reject the Commission's
decision. On the other hand, the City Council continued to consider the zoning of many other PDs during the same
time period, suggesting that the delay was lethargic rather than ill-motivated. And while the City's conduct is
troubling, it must also be said that the benefits the City legitimately sought to achieve from rezoning were not
thereby diminished.
[**50] Taking all of these factors into account, the trial court concluded that the rezoning was not unreasonable,
and a divided court of appeals disagreed. We agree with the court of appeals that the downzoning in this case is
much different from the refusal to upzone in Mayhew, thereby maintaining the status quo and preventing the
landowner from proceeding with an enormous development on land that had long been used solely for agricultural
purposes in a small, uniquely rural environment. Nevertheless, we do not agree that the rezoning in this case went
too far, approaching a taking. Rather, we think that the City's zoning decisions, apart from the faulty way they were
reached, were not materially different from zoning decisions made by cities every day. 92 On balance, we conclude
that the rezoning was not a taking.
[**51] C
We now turn to whether the fifteen-month moratorium preceding the rezoning was a taking.
1
We first consider whether the moratorium substantially advanced legitimate government interests. Sheffield does
not argue that the moratorium should never have been imposed. Rather, Sheffield would hold the City to its own
words. The moratorium, according to the City, was
solely for the purpose of allowing the City Council to study, in conjunction with the City's planning and administrative
officials, the zoning, growth and development related issues and concerns presented by the nonconformity of the
City's planned developments with the City's Code and Future Land Use Plan.
After April 21, 1997, Sheffield argues, there was nothing left "to study". The consultant's report was complete, the
Planning and Zoning Commission had reviewed it, the issues were drawn, and it was time for decision. At its
meeting on that date, Sheffield argues, the City Council could have taken up the Commission's decision to reject
the consultant's recommendation that PD 10 not be rezoned, and could have accepted or rejected it, but did neither
because of a stalemate among councilmembers. Furthermore, [**52] there is evidence that at least one
91 See, e.g., City of Corpus Christi v. Bayfront Assocs., Ltd., 814 S.W.2d 98, 105 (Tex. App.--Corpus Christi 1991, writ denied)
("an individual city council member's mental process, subjective knowledge, or motive is irrelevant to a legislative act of the city,
such as the passage of an ordinance"); Mayhew v. Town of Sunnyvale, 774 S.W.2d 284, 298 (Tex. App.--Dallas 1989, writ
denied) ("the subjective knowledge, motive, or mental process of an individual legislator is irrelevant to a determination of the
validity of a legislative act because the legislative act expresses the collective will of the legislative body") (quoting Sosa v. City
of Corpus Christi, 739 S.W.2d 397, 405 (Tex. App.-- Corpus Christi 1987, no writ)), aff'd after remand, 964 S.W.2d 922, 41 Tex.
Sup. Ct. J. 517 (Tex. 1998).
92 SeeLucas v. S.C. Coastal Council, 505 U.S. 1003, 1027, 120 L. Ed. 2d 798, 112 S. Ct. 2886 (1992) ("It seems to us that the
property owner necessarily expects the uses of his property to be restricted, from time to time, by various measures newly
enacted by the State in the legitimate exercise of its police powers . . . .").
BARBARA QUIRK
EXHIBIT E
Page 24 of 25
140 S.W.3d 660, *679; 2004 Tex. LEXIS 195, **52
councilmember wanted to use delay to give the City more leverage in pressuring Sheffield to agree to a less dense
development plan.
[*680] Again, we agree with the City that HN28[ ] evidence of one official's motives cannot be attributed to the
City itself. We look entirely to the objective evidence regarding the City's actions. The City argues, candidly but
remarkably, that using delay to extract concessions from landowners is a legitimate government function. We
disagree, 93 and were we convinced that this was the sole reason for the City's delay, we would be required to
consider whether the moratorium constituted a compensable taking. Delay may be necessary or appropriate to
allow everyone affected by a zoning decision an opportunity to fully consider all options and negotiate solutions, but
the use of delay for extortion is hardly a legitimate government function. The City also contends that we cannot
second-guess its motives and must presume that the extended moratorium was due to nothing other than an
honest disagreement over the appropriate zoning for the planned development areas. But the takings provision of
the Texas Constitution would suffer a huge [**53] loophole if we were required to presume that a city's endless
refusal to permit a landowner the reasonable use of his property was justified by an honest disagreement of
councilmembers.
The fact is that during eight months of the moratorium, the City rezoned seven PDs. It took time. There is no
evidence that the City meant to unfairly pressure all of the affected landowners. On the contrary, the evidence
reflects an orderly, albeit slow, process toward resolving the differences between the City Council, the Planning and
Zoning Commission, and the City's consultant. One can wish that the process had hurried along, but we cannot say
that the moratorium did not substantially [**54] advance a legitimate governmental purpose.
2
Nor can we say that the moratorium went too far towards a taking. Sheffield did not show during the liability trial, as
it was required to do, what economic impact it suffered from the moratorium as distinct from the rezoning. Nor does
the record show how Sheffield's reasonable, investment-backed expectations excluded the possibility of a fifteen-
month delay in a decision on its development plans. No other aspects of the moratorium make it more like a
temporary taking -- that is, an unreasonable prohibition in the use of property for a defined period 94 -- than a mere
delay in decision. We can easily imagine circumstances in which delay was aimed more at one person, or was
more protracted with less justification, and more indicative of a taking. But the evidence in this case does not
approach that situation.
III
Having failed [**55] to find that the City's rezoning was a compensable taking of Sheffield's property, we are left
with one issue: whether Sheffield's vested rights claim was ripe. Sheffield claims that the plat it filed on March 11,
1997, vested its development rights because the moratorium was not then in effect and the City did not act on the
filing. We agree with the court of appeals that this claim was ripe. The City argues that the parties did not argue
ripeness to the trial court, but that does not lessen the fact that ripeness [*681] was the basis for the trial court's
ruling. As the court of appeals concluded, there was nothing to prevent the trial court from ruling on the merits of
Sheffield's claim.
The concern expressed in the dissent in the court of appeals that Sheffield might both recover damages for
restrictions on the development of its property and nevertheless be permitted to develop its property unimpaired by
93 Cf.Westgate, Ltd. v. State, 843 S.W.2d 448, 454, 36 Tex. Sup. Ct. J. 282 (Tex. 1992) ("The policy reasons that support our
decision today [that delaying condemnation of property after announcement of an intent to do so is not a taking] might not be
applicable where the condemning authority is accused of intentionally injuring a landowner.").
94 See Tahoe-Sierra Pres. Council, Inc. v. Tahoe Reg'l Planning Agency, 535 U.S. 302, 152 L. Ed. 2d 517, 122 S. Ct. 1465
(2002).
BARBARA QUIRK
EXHIBIT E
Page 25 of 25
140 S.W.3d 660, *681; 2004 Tex. LEXIS 195, **55
those restrictions 95 is no longer real, since we have held that Sheffield cannot recover damages. However, another
issue remains: has Sheffield's pursuit of damages foreclosed its claim that it is entitled to develop its property under
PD 10 zoning because of a properly submitted [**56] plat during a hiatus in the moratorium, as found by the trial
court. While this action has been pending, Sheffield sued the City, asserting that its development rights were
statutorily fixed by the original Stone Creek plat in 1986. The court of appeals held in that case that the action for
damages now before us was an election of remedies, foreclosing Sheffield's claim, because Sheffield did not assert
that claim in this action before judgment. 96 But Sheffield's claim for declaratory relief in the present action is on a
different footing. Sheffield did assert in this action, before judgment, that its development rights were fixed, not by
the originally filed plat, but by a plat submitted to the City during what the trial court found was a hiatus in the
moratorium due to the City Council's failure to extend it. The election issue is therefore different. It has not been
briefed or argued, and we express no opinion on it.
[**57] Since the sole question before us is whether the vested rights issue is ripe for decision, and we agree with
the court of appeals that it is, we remand the issue to the trial court for further proceedings.
*****
Accordingly, we reverse the judgment of the court of appeals on Sheffield's takings claims and render judgment that
Sheffield take nothing against the City, and we affirm the judgment of the court of appeals remanding Sheffield's
claim for a declaration that its development rights have been vested by its plat submitted March 11, 1997.
Nathan L. Hecht Justice
End of Document
95 61 S.W.3d at 661 (Vance, J., concurring and dissenting).
96 City of Glenn Heights v. Sheffield Dev. Co., 55 S.W.3d 158 (Tex. App.--Dallas 2001, pet. denied).
BARBARA QUIRK
EXHIBIT E
EXHIBIT E-2
EXHIBIT E-2