Opinion ID: 3008277
Heading Depth: 3
Heading Rank: 1

Heading: Fraud in the Public Use of the Parking Garage

Text: The parties agreed to define public use as: a use which the public is entitled to share indiscriminately in as a matter of right. A use is public when the public obtains some definite right or use in the undertaking to which the property is devoted. What is important in the public-use determination is the character of the right inuring to the public, not the extent to which the public’s right is exercised. 10 The City objected and proposed an alternate definition of fraud, but has not pursued that issue on appeal. As our inquiry is a question of law, these definitions in the jury charge should instead have been conclusions of law. W e may review conclusions of law to determine their correctness. BMC Software Belgium, N.V. v. Marchand, 83 S.W .3d 789, 794 (Tex. 2002). But we will not reverse an erroneous conclusion if the trial court rendered the proper judgment. Id. Because any change in the definition would not yield a different outcome here, we do not address whether the parties’ definition of fraud is legally correct in its entirety. 14 A “public use” is not a private use. A taking may not be used to confer a private benefit on a particular private party or parties through the use of the property. A taking may not be used for a public use that is merely a pretext to confer a private benefit on a particular private party or parties. This Court has defined public use in similar circumstances as when the public obtains some definite right or use in the undertaking to which the property is devoted. Coastal States Gas Producing Co. v. Pate, 309 S.W.2d 828, 833 (Tex. 1958); see also Higginbotham, 143 S.W.2d at 84 (“‘It is immaterial if the use is limited to the citizens of a local neighborhood, or that the number of citizens likely to avail themselves of it is inconsiderable, so long as it is open to all who choose to avail themselves of it.’”(quoting West, 238 S.W. at 978)). Public use, however, does not include a benefit to the public welfare or good under which any business that promotes the community’s comfort or prosperity might be benefitted from the taking.11 Pate, 309 S.W.2d at 833. In 2001, the City Council authorized a condemnation lawsuit “for the construction of a parking garage for the Austin Convention Center . . . .” The Whittingtons assert that the taking was fraudulent as to the parking garage because it “favored one private party over another at public expense” by “reliev[ing] H.L. Hotels of its obligation to provide parking for the Convention Center.” We disagree. The parking garage was to provide parking for the expanded convention center. This is a public use. Pate, 309 S.W.2d at 833.12 The effect of the City’s decision to take Block 38 11 In 2003, the Legislature added section 21.023 to the Property Code, which requires a governmental entity acquiring property through eminent domain to notify landowners of their right to repurchase the property if the public use for which the property was acquired is cancelled before the tenth anniversary of the acquisition. T EX . P RO P . C O DE § 21.023. 12 See T EX . L OC . G O V ’T C O D E § 251.001(a)(1) (authorizing home rule municipalities to “exercise the right of eminent domain for a public purpose” such as providing, enlarging, or improving auditoriums); id. at § 251.001(a)(5) (authorizing home rule municipalities to “exercise the right of eminent domain for a public purpose,” including “for any other municipal purpose the governing body considers advisable”). 15 rather than build the larger underground garage with the hotel project was, at best, an incidental benefit to the H.L. Hotels.13 The decision not to build the larger underground garage resulted in a cost savings to the hotel project of approximately $10–12 million, resulting in fewer bonds being issued. The direct impact to the project developer was that its fee would be reduced if the overall project cost was reduced. There was no evidence introduced at trial to prove a benefit to H.L. Hotels due to the lower cost of the project. We hold that the City’s determination that the parking garage was a public use was not fraudulent.