Court Opinion

ID: 2902935
Source: CourtListenerOpinion
Date Created: 2015-09-09 19:42:03.459398+00
Date Added: 2024-06-11T12:26:09.842321
License: Public Domain

COURT OF APPEALS
                                     EIGHTH DISTRICT OF TEXAS
                                          EL PASO, TEXAS

                                                       §
 THE CITY OF EL PASO, TEXAS,                                             No. 08-06-00332-CV
 A MUNICIPAL CORPORATION,                              §
                                                                               Appeal from
                           Appellant,                  §
                                                                           171st District Court
 v.                                                    §
                                                                       of El Paso County, Texas
 TRUETT L. MADDOX, D.D.S. and                          §
 BERRY H. EDWARDS, TRUSTEE,                                                 (TC # 92-14046)
                                                       §
                           Appellees.

                                                OPINION

        The City of El Paso, Texas, a Municipal Corporation, brings this interlocutory appeal from

an order denying its plea to the jurisdiction. We sustain the City’s sole issue for review, reverse the

trial court’s order denying the plea to the jurisdiction, and render judgment dismissing the underlying

cause for want of subject matter jurisdiction.

                                         FACTUAL SUMMARY

        This is the third appeal arising from a suit brought by Appellees, Dr. Truett L. Maddox,

D.D.S. and Berry H. Edwards, Trustee, against the City and other defendants1 who are not parties

to this appeal. See Edwards v. Mesa Hills Mall Company Limited Partnership, 186 S.W.3d 587

(Tex.App.--El Paso 2006, no pet.); Maddox v. City of El Paso, Texas, No. 08-98-00409-CV, 2000
WL 799070 (Tex.App.--El Paso June 22, 2000, pet. denied). Although some of the basic facts of

        1
         Appellees also sued M esa Hills Mall Company, L.P., Simon Property Group, L.P., Melvin Simon, and Herbert
Simon (collectively referred to as the Simon Defendants).
the dispute have been set forth in our prior opinions, it is necessary to outline the pertinent factual

allegations contained in the live pleading2 and the evidence adduced in connection with the City’s

plea to the jurisdiction in resolving the jurisdictional issue presented.

            According to their pleadings, Dr. Maddox and Edwards own three tracts of property totaling

15.229 acres (referred to collectively as the Property) on the west side of El Paso.3 Dr. Maddox

acquired the first tract consisting of 12.5315 acres in 1972 (the Surplus Property), the second tract

consisting of .5505 acre in 1978 (the Trade Property), and the third tract consisting of 2.147 acres

in 1979 (the Abutting Property). He purchased the tracts for the purpose of commercial, office, and

residential development. One of the tracts abuts Park West Unit 3 on which Sunland Park Mall was

built.

            When Dr. Maddox acquired the Surplus Property in 1972, it did not have access to any public

street or right of way or, in other words, it was landlocked. The following year at Dr. Maddox’s

request, the City re-zoned the Surplus Property to Apartment/Office (A/O). Three years later, on

October 15, 1976, Mesa Hills Mall Company L.P. acquired the 79.168 acre tract which was platted

into Park West Unit 3, a single lot subdivision with no interior streets. Dr. Maddox acquired the

Abutting Property in 1979 with the knowledge that Mesa Hills Mall Company had purchased the

79.168 acre tract for the purpose of shopping center development, but he denies having knowledge

that the property had been platted into Park West Unit 3. He expected that his acquisition of the

Abutting Property would ensure that his landlocked property would eventually gain access to a

public street through Park West Unit 3. He based this belief on a 1974 Subdivision Ordinance and

            2
                The trial court entered an order that the Twelfth Amended Petition is the live pleading.

            3
                Dr. Maddox owns a 60 percent undivided interest in the property and Edwards owns a 40 percent undivided
interest.
City policy which required a subdivider to provide access to adjoining unplatted areas. Appellees

allege in their petition that neither Mesa Hills Mall Company nor the City disclosed during the

subdivision platting process between 1978 and 1987 that Mesa Hills intended to sell lots in Park

West Unit 3 without street frontage.

         Upon learning that the Property would not be provided street access via the Park West Unit 3

development, Appellees unsuccessfully attempted to negotiate access with Mesa Hills Mall

Company and the other Simon Defendants. In 1992, the Appellees asked the City to enforce the

1974 ordinance against Mesa Hills Mall Company, and the City Council instructed the City Attorney

to do so. Shortly thereafter, the City rescinded its prior order and amended the 1974 ordinance to

eliminate the requirement for public streets in a shopping center with internal lots so long as access

between lots was provided with reciprocal easements.

         Appellees filed suit against the City in 1992, alleging that the amendment to the 1974

Subdivision Ordinance and its retroactive application to Park West Unit 3 constituted a taking

because their property has been rendered unsaleable and of no value. The Simon Defendants were

later added as defendants, but the trial court granted summary judgment in their favor on both the

constitutional taking and the fraud claims asserted against them. See Edwards, 186 S.W.3d at 591-

92 (affirming summary judgment). The only claims remaining in the case are the constitutional

taking claims asserted against the City.4

         In 2004, the City filed a plea to the jurisdiction alleging that the trial court lacked jurisdiction

because Appellees’ claim of a regulatory taking is unripe. The trial court conducted a hearing on the

         4
             On October 19, 2004, the trial court granted summary judgment in favor of the City of El Paso with respect
to all of Appellees’ claims except for the takings claims asserted under Article I, Section 17 of the Texas Constitution,
the Fourteenth Amendment to the United States Constitution, and 42 U.S.C. § 1983. The limited record before us does
not reflect the nature of the other claims asserted against the City.
plea to the jurisdiction and both parties relied on evidence attached to their responsive pleadings.

The City presented the affidavit of Rodolfo Valdez, a city employee and custodian of city records.

Valdez averred that at the time the ordinance was amended, there was no active, pending plat,

subdivision application, or other development application submitted to or filed with the City

regarding the Property, and there has not been a rejection or denial by the City of any plat,

subdivision application, or other development application regarding the Property. Nor has a variance

been sought with respect to the application of the amended ordinance to the Property. There has

been no decision or determination by the City Council concerning the platting or development of the

Property. Valdez also stated that “there has not been any final decision or determination by the City

Council of the City concerning the platting or development of the Property.” According to Valdez’s

affidavit, a plat was filed for some or all of the Property in September 1989, to be known as the

“Commerce Park” subdivision. The City Plan Commission approved the plat in November 1989

subject to certain terms and conditions, including a name change. The name of the subdivision was

later changed to Galleria Plaza subdivision. In 1991, the platting process for the Galleria Plaza

subdivision was “actually or constructively abandoned” at a preliminary stage. No action had been

taken seeking approval from the City for platting of the Galleria Plaza subdivision. According to

Valdez, the City owns significant portions of land which border or are “in the neighborhood of” the

Property, but the City has not had the opportunity to formally deliberate, consider, and decide, in the

ordinary administrative process, any method of providing alternative means of access to the Property

because Appellees filed suit shortly after the ordinance was amended rather than making any effort

to file a plat, subdivision application, or other development application with the City, or seek a

variance.
         Appellees relied on evidence5 that when their property was re-zoned in 1973, the City

imposed a requirement that they show ingress and egress to obtain building permits. Appellees also

presented evidence that in 1992, as alleged in their petition, they made a complaint to the City

Council regarding Park West Unit 3’s non-compliance with the subdivision ordinance which

required that access be provided to the Property, and in response, the City Council ordered the City

Attorney to enforce the ordinance. Subsequently, however, the City Council rescinded its directive

to enforce the ordinance, and it instead amended the ordinance to eliminate the requirement which

would have required that Park West Unit 3 provide access to the Property. Following the hearing,

the court denied the plea to the jurisdiction and the City filed notice of accelerated appeal.

                                     PLEA TO THE JURISDICTION

         In its sole issue for review, the City complains that the trial court erred by denying its plea

to the jurisdiction because Appellees’ constitutional taking claim is not ripe because they have not

(1) submitted a development plan with the City, which was rejected; and (2) sought a variance,

which was denied. Appellees concede that they did not file a development plan after the regulation

was retroactively applied to Park West Unit 3, but contend that taking these actions would have been

futile. Further, they argue that under the unique facts of this case, the City’s actions in withdrawing

its order to enforce the 1974 Subdivision Ordinance and amending the ordinance in the face of

Appellees’ request to enforce the ordinance, constituted a final decision applying the ordinance to

the Property.

                                              Standard of Review

         A plea to the jurisdiction contests a trial court’s subject matter jurisdiction. Bland

         5
           Appellees attached documents and deposition excerpts to its response. At the hearing, the City objected to
the evidence but did not obtain a ruling.
Independent School District v. Blue, 34 S.W.3d 547, 554 (Tex. 2000). Whether a court has subject

matter jurisdiction is a question of law. Texas Department of Parks & Wildlife v. Miranda, 133
S.W.3d 217, 226 (Tex. 2004). Ripeness is an element of subject matter jurisdiction. Mayhew v.

Town of Sunnyvale, 964 S.W.2d 922, 928 (Tex. 1998). The issue whether a pleader has alleged facts

that affirmatively demonstrate a trial court’s subject matter jurisdiction is a question of law which

is reviewed de novo. Miranda, 133 S.W.3d at 226. Similarly, whether undisputed evidence of

jurisdictional facts establishes a trial court’s jurisdiction is also a question of law subject to de novo

review. Id. In some cases, however, disputed evidence of jurisdictional facts that also implicate the

merits of the case may require resolution by the finder of fact. Id. In that circumstance, the trial

court cannot grant the plea to the jurisdiction, and the fact issue must be resolved by the fact finder.

Id. at 227-28. If the relevant evidence is undisputed or fails to raise a fact question on the

jurisdictional issue, the trial court rules on the plea to the jurisdiction as a matter of law. Id. at 228.

This standard generally mirrors that of a summary judgment under TEX .R.CIV .P. 166a(c). Id.

        The City’s plea to the jurisdiction challenges the existence of jurisdictional facts and it

presented evidence in support of its assertion that the court lacked subject matter jurisdiction.

Appellees filed a response and also presented evidence in support of their claim that their takings

claims were ripe. Neither party asserted that there were fact issues which required resolution by a

fact finder before the jurisdictional issue could be resolved. By determining that it had subject

matter jurisdiction, the trial court impliedly determined that there were no fact issues which required

resolution. Neither party submits on appeal that there are disputed fact issues. We are presented

with a plea to the jurisdiction in which undisputed evidence implicates both subject matter

jurisdiction and the merits of the case. In resolving the jurisdictional issue presented, we consider

relevant evidence submitted by the parties as the trial court is required to do. Id. at 227.
                                         Regulatory Taking

       Article 1, Section 17 of the Texas Constitution provides that “[n]o person’s property shall

be taken, damaged or destroyed for or applied to public use without adequate compensation being

made . . . .” TEX .CONST . art. 1, § 17. Inverse condemnation occurs when property is taken for public

use without proper condemnation proceedings and the property owner attempts to recover

compensation for that taking. City of Abilene v. Burk Royalty Company, 470 S.W.2d 643, 646 (Tex.

1971); Park v. City of San Antonio, 230 S.W.3d 860, 867 (Tex.App.--El Paso 2007, pet. denied).

To state a cause of action for inverse condemnation under the Texas Constitution, a plaintiff must

allege (1) an intentional governmental act; (2) that resulted in his property being taken, damaged, or

destroyed; (3) for public use. General Services Commission v. Little-Tex Insulation Company, Inc.,

39 S.W.3d 591, 598 (Tex. 2001); Park, 230 S.W.3d at 867. Takings are classified as either physical

or regulatory. Mayhew, 964 S.W.2d at 933. Physical takings occur when the government authorizes

an unwarranted physical occupation of an individual’s property. Id. A compensable regulatory

taking occurs when a governmental agency imposes restrictions that either deny a property owner

all economically viable use of his property or unreasonably interferes with the owner’s right to use

and enjoy the property. City of Dallas v. Blanton, 200 S.W.3d 266, 271 (Tex.App.--Dallas 2006,

no pet.), citing Mayhew, 964 S.W.2d at 935.

                                              Ripeness

       For a regulatory takings claim to be ripe, there must be a final decision regarding the

application of the regulation to the property at issue. Mayhew, 964 S.W.2d at 929, citing Suitum v.

Tahoe Regional Planning Agency, 520 U.S. 725, 734, 117 S. Ct. 1659, 1665, 137 L. Ed. 2d 980 (1997)

and Williamson County Regional Planning Commission v. Hamilton Bank, 473 U.S. 172, 186, 105
S. Ct. 3108, 3116, 87 L. Ed. 2d 126 (1985). A final decision usually requires both a rejected
development plan and the denial of a variance from the controlling regulation. Mayhew, 964 S.W.2d

at 929, citing Hamilton Bank, 473 U.S. at 187-88, 105 S.Ct. at 3117. However, futile variance

requests or re-applications are not required. Mayhew, 964 S.W.2d at 929. The term “variance” is

“not definitive or talismanic;” it encompasses “other types of permits or actions [that] are available

and could provide similar relief.” Id. at 930, quoting Southern Pacific Transportation Company v.

City of Los Angeles, 922 F.2d 498, 503 (9th Cir. 1990), cert. denied, 502 U.S. 943, 112 S. Ct. 382,

116 L. Ed. 2d 333 (1991). The variance requirement is therefore applied flexibly in order to serve its

purpose of giving the governmental unit an opportunity to “grant different forms of relief or make

policy decisions which might abate the alleged taking.” Id., quoting Southern Pacific, 922 F.2d at

503.

                               Appellees’ Regulatory Taking Claim

       The nature of Appellees’ claim complicates the ripeness inquiry because it is not the typical

regulatory taking claim arising when some sort of regulation is applied directly to property with a

resulting loss of value. Instead, Appellees’ claim is based on allegations that (1) the City’s refusal

to enforce the 1974 Subdivision Ordinance against an abutting property, Park West Unit 3, and (2)

the City’s amendment of the Subdivision Ordinance and its retroactive application of the amended

ordinance to Park West Unit 3, has resulted in a denial of access to their Property and a loss of all

value. Thus, the claim is based on an indirect application of a regulation to their property. Although

Appellees’ claim is atypical, we conclude that it involves a regulatory taking and they must show that

there has been a final decision applying the regulation to their property

                                         The Ripeness Issue

       Appellees first argue that the City made a final decision when it refused to enforce the 1974

Subdivision Ordinance against Park West Unit 3 and it amended the ordinance so that Park West
Unit 3 was not required to provide access to the abutting property. It may well be a final decision

with respect to Park West Unit 3, but to show that their regulatory taking claim is ripe, Appellees

must demonstrate that the City has made a final decision applying the regulation to the Property.

The evidence does not support such a conclusion.

       It is undisputed that the City has not rejected a development plan for the Property. The

evidence shows that Appellees abandoned a development plan for the Property in 1991 and they did

not take any action seeking approval from the City for platting of the Galleria Plaza subdivision.

This abandonment of the development plan occurred before the City’s alleged refusal to enforce the

1974 Subdivision Ordinance and the amendment of that ordinance in 1992. Since that time,

Appellees have not taken any steps to re-submit a development plan or seek a variance from the

amended ordinance. Instead, they filed suit shortly after the City amended the ordinance. As a result

of Appellees’ failure to submit a development plan or seek a variance, the City has not been given

an opportunity to consider, in the ordinary administrative process, Appellees’ complaints about a

lack of access to their landlocked property. During that process, the City could consider alternative

means of providing access to the Property. Based on these facts, we find that the City has not made

a final decision applying the amended ordinance to the Property.

       Appellees also claim that it would have been futile for them to submit a development plan,

plat the Property, or seek a variance from the amended ordinance. In support of their argument that

the futility exception applies under the facts of this case, Appellees cite Hallco Texas Inc. v.

McMullen County, 221 S.W.3d 50 (Tex. 2006) and Mayhew.

       In Mayhew, the town initially permitted residential development at a density of 3.6 units per

acre, but the ordinance was amended in response to septic tank failures to require a one-acre

minimum lot size. Mayhew, 964 S.W.2d at 925. Even though sanitary sewer facilities were later
made available, the town did not repeal the one-acre minimum lot requirement. Id. The Mayhews

began meeting with town officials seeking permission to proceed with a planned development with

a density which exceeded the one-unit-per acre zoning requirement, and they told the town officials

that a planned development would not be feasible under the one-unit-per-acre zoning. Id. at 925-26.

The town amended its zoning ordinances to allow, upon council approval, planned developments

with densities in excess of one unit per acre. Id. at 926. After spending more than $500,000 on

studies and evaluative reports, the Mayhews submitted their planned development proposal to the

town. Id. The proposal was based on a density of over three units per acre. Id. While the planning

and zoning commission was reviewing the application, the town council passed a moratorium on

planned developments. Id. The commission recommended denial of the Mayhew’s proposal, stating

a preference for a less dense use of the property. Id. The town council appointed a negotiating

committee which met with the Mayhews. Id. Both sides tentatively agreed to a compromise

development of 3,600 units. Id. At a meeting with the town council, the Mayhews told the council

that anything less than approval for 3,600 units would be considered an outright denial. Id. The

town council again voted to deny the Mayhews’ development proposal and the town canceled a

meeting to reconsider the planned development request. Id. The Mayhews subsequently filed suit

alleging, among other things, that the town’s refusal to approve the planned development was a

taking of their property. Id. The trial court granted summary judgment on behalf of the town with

respect to this claim, but the Dallas Court of Appeals reversed concluding that material fact

questions existed as to whether the town violated the Mayhews’ rights under the state and federal

constitutions. Id. Upon remand, the case was tried to the court. Id. at 927. The district court

concluded that the case was ripe for adjudication and that the town’s decision to deny the application

for the planned development was an unconstitutional taking under both the federal and state
constitutions. Id. The court of appeals reversed the district court’s judgment and dismissed the

Mayhews’ claims, holding that none of the claims was ripe for review. Id. In the Supreme Court,

the town argued that the Mayhews’ claims were not ripe because they submitted only one planned

development application and did not thereafter reapply for development or submit a variance. Id.

at 931. Although the failure to reapply or seek a variance normally would be fatal to the ripeness

of the Mayhews’ claims, the Supreme Court found that, under the unique facts of the case, the

Mayhews’ planned development application and amended request for 3,600 units were sufficient,

and any further applications would have been futile. Id. The court based its decision on the evidence

showing that the Mayhews expended over $500,000 preparing and developing the application, they

presented the initial proposal based on a density of over three units per acre, they engaged in

negotiations with the town for over a year after the first proposal was rejected, and they presented

a modified proposal which was subsequently rejected.            Id.   The instant case is factually

distinguishable. In Mayhew, the town rejected the development plan. Here, Appellees abandoned

their original development plan and they have not submitted a plan since the ordinance was

amended. In short, the City has not rejected a development plan submitted by Appellees.

       In Hallco Texas, Hallco purchased property near a reservoir with the intent of operating a

non-hazardous industrial waste landfill, which required a permit from the Texas Commission on

Environmental Quality. 221 S.W.3d at 52. Shortly after Hallco purchased the property, the

McMullen County Commissioners Court adopted a resolution expressing opposition to the proposed

use as a potential hazard to local water supplies. Id. at 53. Despite the opposition, Hallco filed its

application with TCEQ. Id. McMullen County subsequently passed an ordinance banning the

disposal of solid waste within three miles of the reservoir but allowed disposal in other areas

provided applicable state requirements were satisfied. Id. Hallco challenged the ordinance by filing
suit in federal district court and it filed a parallel proceeding in state court. Id. at 53-54. The federal

court dismissed without prejudice Hallco’s claim alleging an unconstitutional taking in violation of

the Fifth Amendment to the United States Constitution, holding that to ripen its federal takings

claim, Hallco first had to seek compensation through procedures the state had established. Id. at 54.

A week after the federal court’s dismissal, the County moved for summary judgment in state court

on various grounds. Id. The court of appeals affirmed the trial court’s judgment, holding that

Hallco’s takings claim failed because it did not have a cognizable property interest of which the

government could deprive it. Id.6 Hallco did not appeal that decision. Id. at 55. More than two

years later, Hallco submitted a request for a variance to the McMullen County Commissioners Court

but offered no changes to its proposed landfill. Id. The commissioners heard a presentation on the

variance request, but did not take any action. Id. Two months later, Hallco filed suit alleging that

the county’s denial of the variance request constituted a taking under Article 1, Section 17 of the

Texas Constitution. Id. The county moved for summary judgment on all of Hallco’s claims on

various grounds, including that all of Hallco’s claims were barred by res judicata because they were

or could have been raised in the first state lawsuit (Hallco I). Id. The trial court again granted the

county’s motion without specifying the grounds, and the court of appeals affirmed. Id. at 55-56.7

To avoid the County’s res judicata argument, Hallco argued that its takings claim was not ripe in

Hallco I. Id. at 58-59. The Supreme Court addressed the ripeness argument in Section IIIA of its

opinion, but only four of the justices joined this part of the opinion. Id. at 58. The court found that

the ordinance at issue was not subject to discretionary application or variance and it prohibited

        6
           Hallco Texas, Inc. v. McMullen County, Texas, 1997 W L 184719, *2, 3 (Tex.App--San Antonio April 16,
1997, no pet.)(not designated for publication)(“Hallco I”).

        7
            Hallco Texas, Inc. v. McMullen County, 94 S.W .3d 735 (Tex.App.--San Antonio 2002, no pet.)(“Hallco II”).
precisely the use Hallco intended to make of the property. Id. at 60. Thus, Hallco’s taking claim was

ripe upon enactment of the ordinance and res judicata applied.             Id.   The instant case is

distinguishable because the ordinance in question does not prohibit Appellees’ intended use of the

property. Further, the City has the discretion to grant a variance.

       We conclude that the City has not been given an opportunity to make a final decision on

Appellees’ access to its property and Appellees have not presented evidence establishing that

submitting a development plan or seeking a variance would have been futile. Accordingly, we

reverse the order of the trial court denying the City’s plea to the jurisdiction and we render judgment

dismissing Appellees’ taking claims without prejudice.

September 11, 2008
                                                       ANN CRAWFORD McCLURE, Justice

Before Chew, C.J., McClure, and Carr, JJ.
Carr, J., concurs in the judgment