Developer can go forward in suit challenging closure of roadway which does not abut its own property.

 

City of Dallas v. Millwee-Jackson Joint Venture, 05-13-00278-CV (Tex. App. – Dallas, April 4, 2014).

This is an interlocutory appeal from the denial of a plea to the jurisdiction in an inverse condemnation suit. The Dallas Court of Appeals affirmed the denial noting jurisdictional fact questions exist precluding dismissal.

Millwee-Jackson Joint Venture (“MJJV”) intended to build a hotel and sought a permit to build a bridge over a creek to connect to a key artery in 1982. Due to a variety of reasons, the property did not develop. MJJV alleges in 1998 the City deleted the main artery, Alamo Street, from its master thoroughfare plan. The City closed Alamo Street in 2002 and MJJV filed suit in 2004 for inverse condemnation, injunction and nuisance. The case went up and down the court of appeals until the City amended its plea to the jurisdiction, which the trial court denied and the City appealed.

After analyzing the standards for different types of regulatory takings, the court explained that MJJV alleges TxDOT intends to acquire City parkland for widening of an interstate and, under federal and state law, the City must mitigate the loss by acquiring new parkland. MJJV’s property is the nearest property realistically capable of being condemned for that purpose, so the City allegedly is intentionally thwarting its development to lower condemnation costs. Despite no direct evidence the City intends to condemn the property for parkland, MJJV presented evidence forming the basis of this speculation. And while the City produced plans and evidence of future development showing the MJJV property not being acquired for any purpose, the court determined a fact question existed.

The court next examined MJJV’s investment-backed expectation entitlements. The City asserted that since MJJV offered to donate the property to the City prior to closing Alamo Street, he had no expectation of development. MJJV countered the offer to donate was part of an attempted settlement in a sign code dispute, which the City did not accept. It purchased the property in a commercial zone and produced evidence of the attempted development activity towards the property. As a result, factual questions exist precluding dismissal. Next, the City asserted that no taking can occur for the closing of Alamo Street since it was not connected with the property originally so no denial of access could result. However, the evidence established MJJV’s property could not be developed without the bridge connecting it to Alamo Street and permits were applied for and conditionally granted prior to closure. Sufficient jurisdictional assertions were raised to give jurisdiction to the trial court.

The court analyzed MJJV’s injunctive relief to force the City to reopen Alamo Street next. Even though MJJV’s property does not abut Alamo Street as typically required under Tex. Civ. Prac. & Rem. Code §65.015 (statutory requirements for closure in relation to abutting property owner’s rights), an owner can acquire rights by easement or prescription so does not have to abut the roadway. MJJV presented evidence establishing jurisdiction to determine whether its actions qualify as a prescriptive easement to Alamo Street, which could entitle him to force the City to reopen the roadway. Finally, in relation to the nuisance claim, the court off-handedly simply said the regulatory taking claim remains unresolved so fact questions exist as to nuisance.  The plea was properly denied.

If you would like to read this opinion click here. Panel: Justices Moseley, Lang, and Brown. Opinion by Justice Moseley.  The attorneys listed for the City are Barbara E. Rosenberg and Christopher J. Caso.  The attorney listed for MJJV is Arthur J. Anderson.