Board of Regents of Univ. V. Fkm Partnership
| Decision Date | 14 April 2005 |
| Docket Number | No. 14-03-00392-CV.,14-03-00392-CV. |
| Citation | 178 S.W.3d 1 |
| Parties | BOARD OF REGENTS OF THE UNIVERSITY OF HOUSTON SYSTEM and The State of Texas, Appellants, v. FKM PARTNERSHIP, LTD., A Texas Limited Partnership, Nationsbank of Texas N.A., City of Houston, County of Harris, Houston Community College, And Houston Independent School District, Appellees. |
| Court | Texas Supreme Court |
Katherine E. Clark Kasten, Cavitt Wendlandt, Danica Lynn Milios, Austin, for appellants.
Alan Brandt Daughtry, Billy C. Dyer, H. Dixon Montague, Houston, for appellees.
Panel consists of Justices FOWLER, EDELMAN, and SEYMORE.
MAJORITY OPINION
The University of Houston appeals from the county court's dismissal of its suit for condemnation of a tract of land owned by FKM Partnership (FKM). The University alleges the county court erred in (1) dismissing its cause for want of jurisdiction, and (2) assessing temporary damages, attorney's fees, and costs for the University's temporary possession of the property. We reverse and remand.
FKM owns a 1.0792 acre tract of land located along the east side of the University's campus with frontage on Calhoun Road and the frontage road of State Highway 35. In 1996, FKM made plans to develop the property as a retail shopping center. FKM presented its plan to Ron Shoup at the University, who expressed such an interest in the shopping center he explored the possibility of a partnership with FKM to develop the property. FKM worked with the University on sign control, tenants desired by the University, and landscaping for the retail center. After investigating the possibility of a partnership, the University declined to enter into an arrangement with FKM. FKM continued to work toward development of the shopping center and in early 1998, sent a site plan to the president of the University showing the proposed retail center. At approximately the same time, the University informed FKM it was considering acquiring the property.
On January 7, 1998, the University offered to purchase the property from FKM for $205,250. FKM rejected the University's offer. On February 19, 1998, the University Board of Regents met and approved acquisition of the property by condemnation. The minutes of the board meeting reflected, Two days before the Board of Regents' meeting, the University filed an original petition in condemnation in the County Civil Court at Law No. 3 for Harris County. Special commissioners were appointed by the county court and the commissioners assessed damages to be paid to FKM at $275,000. FKM timely filed objections to the special commissioners' award and trial was set for February 17, 2003. Before trial, the University filed a motion for partial summary judgment on the grounds that (1) public necessity existed for the condemnation, (2) the University complied with statutory prerequisites, and (3) good faith negotiations occurred.
Several years later, the University filed a Fourth Amended Petition requesting a significantly smaller tract of land within the original 1.0792 acre tract sought in the condemnation proceeding before the special commissioners. Some time after this, FKM filed its Second Amended Motion to Dismiss and Plea to the Jurisdiction in which it contended the University failed to (1) demonstrate public necessity for the taking of the smaller tract; (2) comply with the statutory prerequisites; and (3) negotiate in good faith for the smaller tract prior to filing the fourth amended petition.
The trial court held a hearing on FKM's motion to dismiss shortly thereafter. After hearing arguments of counsel, the county court determined the University did not have the legal right to acquire the smaller tract of land in the condemnation proceeding. The county court dismissed the University's condemnation petition for want of jurisdiction and set a trial date to hear evidence of FKM's temporary damages incurred because of the wrongful condemnation proceeding. The issue of FKM's temporary damages was tried to a jury, which found FKM's reasonable and necessary appraisal fees and expenses were $67,031.71, FKM's reasonable and necessary attorney's fees were $495,642.05 for preparation and trial plus $150,000 in the event of appeals to the Court of Appeals and the Texas Supreme Court, and $25,000 for further proceedings if the petition for review is granted. The jury further found $323,026 as damages for the University's temporary possession of FKM's property from July 6, 1999 to the date of trial.
In its first issue, the University contends the county court erred in concluding it lacked jurisdiction. The procedure for condemning public property is prescribed in sections 21.012 through 21.016 of the Texas Property Code. If the entity with eminent domain authority cannot agree with the property owner regarding the amount of damages, it must file a petition with the proper court with a description that contains the following: (1) the property to be condemned; (2) the purpose for which the entity intends to use the property; (3) the name of the property owner; and (4) a statement that the entity and the property owner are unable to agree on the damages. TEX. PROP.CODE § 21.012. The judge of the court must then appoint three disinterested freeholders who reside in the county as special commissioners to assess the damages of the property owner. TEX. PROP.CODE § 21.014. The special commissioners must conduct a hearing to determine the amount of damages. TEX. PROP.CODE § 21.015. If a party timely objects to the findings of the special commissioners, the court shall try the case in the same manner as other civil cases. TEX.PROP.CODE § 21.018.
At the hearing on the motion to dismiss, FKM argued the county court at law is not a court of general jurisdiction, and its power to act in condemnation cases is both special and limited. See Pearson v. State, 159 Tex. 66, 315 S.W.2d 935, 937 (1958). FKM further claimed the University did not strictly comply with the Property Code and the county court was, therefore, without jurisdiction to hear the case. More specifically, FKM argued the following points:
• the jurisdictional prerequisite that the special commissioners conduct a hearing to determine the amount of damages was not satisfied because the smaller tract was not presented to the commissioners (see TEX.PROP.CODE § 21.015);
• the jurisdictional prerequisite that the University's acquisition of the property was for a public purpose was not satisfied (see TEX.PROP.CODE § 21.012(b)(2)); and
• the jurisdictional prerequisite that the parties negotiate in good faith was not satisfied. (see TEX.PROP.CODE § 21.012(b)(4)).
The county court retained jurisdiction when the University sought to condemn less land
In FKM's first contention before the county court, it argued the court had no jurisdiction because acquisition of the smaller tract of land was not presented to the special commissioners; therefore, the county court had no "appellate jurisdiction." Proceedings to condemn land are special in character, and the party attempting to establish its right to condemn must show strict compliance with the law authorizing private property to be taken for public use. State v. Bristol Hotel Asset Co., 65 S.W.3d 638, 640 (Tex.2001). When, as here, the parties are unable to agree on the amount of damages, section 21.015 of the Property Code requires that special commissioners be appointed to make a disinterested finding as to the amount of damages. State v. Blackstock, 879 S.W.2d 125, 126 (Tex.App.-Houston [14th Dist.] 1994, writ denied). From the time the condemnor files the original statement seeking condemnation to the time of the special commissioners' award, the initial proceedings are administrative in nature. Amason v. Natural Gas Pipeline Co., 682 S.W.2d 240, 242 (Tex.1984). If either party timely files an objection to the commissioners' award, the county court is invested with jurisdiction of the subject matter of the case. Denton County v. Brammer, 361 S.W.2d 198, 200 (Tex.1962).
FKM contends that because the acquisition of the smaller tract of land was never presented to the commissioners, the commissioners could not have assessed damages with respect to that piece of property. The University contends, however, it was entitled to decrease the amount of property it sought to acquire at any time. A condemnor has the right to dismiss a portion of the land it seeks when it decides its purpose may be accomplished with less land than was initially sought. Southwestern Bell Telephone Co. v. West, 417 S.W.2d 297, 299 (Tex.Civ.App.-Tyler 1967, writ ref'd n.r.e.).
Dismissal is not mandated by statute
Our review of this case must be guided by the applicable statutes and controlling case law. Although not immediately apparent, the property code's eminent domain provisions, read in conjunction with Texas case law, reveal that the county court did not lose jurisdiction when the University amended its pleadings to condemn a smaller portion of land than originally sought before the commissioners. The county court's jurisdiction vests when a party files objections to the special commissioners' findings. TEX.PROP.CODE § 21.017. Once the objections are filed, the court must "try the case in the same manner as other civil cases." TEX.PROP.CODE § 21.018(b). Like other civil cases, an eminent domain proceeding is subject to the rules of civil procedure. Rose v. State, 497 S.W.2d 444, 445-46 (Tex.1973). The rules of civil procedure permit parties to amend their pleadings and also to dismiss some or all of their claims. Tex.R. Civ. P. 63 (per...
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