IN RE SPIRITAS RANCH ENTERPRISES, LLP

• Decision Date: 22 March 2007
• Docket Number: No. 2-06-463-CV.,2-06-463-CV.
• Citation: 218 S.W.3d 887
• Parties: In re SPIRITAS RANCH ENTERPRISES, L.L.P., Relator.
• Court: Texas Court of Appeals

218 S.W.3d 887

In re SPIRITAS RANCH ENTERPRISES, L.L.P., Relator.

No. 2-06-463-CV.

Court of Appeals of Texas, Fort Worth.

March 22, 2007.

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Winstead Sechrest & Minick, P.C., David F. Johnson, Fort Worth, Arthur J. Anderson, Dallas, for Petitioner.

Brown & Hofmeister, L.L.P., Robert F. Brown, Edwin P. Voss, Jr., Richardson, for Real Party in Interest.

PANEL B: LIVINGSTON, DAUPHINOT, and HOLMAN, JJ.

OPINION ON REHEARING

TERRIE LIVINGSTON, Justice.

Introduction

After reconsidering our prior opinion on the Town of Little Elm's motion for rehearing, we deny the motion, but we withdraw our opinion and judgment of February 22, 2007 and substitute the following in their place.

This original proceeding concerns the Town of Little Elm's proposed annexation of property owned by relator Spiritas Ranch Enterprises, L.L.P. The main issue is whether the trial court should have issued a temporary restraining order (TRO) prohibiting the Town from annexing or taking steps to annex Spiritas's property until after Spiritas had been given the opportunity to arbitrate whether the property could be annexed without inclusion in the Town's three-year annexation plan. For the reasons set forth below, having considered all of the filings from both parties,¹ we determine that Spiritas is entitled to mandamus relief.

Background Facts

In late September 2006, the Town began the process of annexing approximately 1,103 acres of nonresidential properties located within its extraterritorial jurisdiction² along State Highway 380 pursuant to section 43.052(h)(1) of the local government code, which allows largely undeveloped property to be annexed without inclusion in the Town's three-year annexation plan.³ TEX. LOC. GOV'T CODE ANN. § 43.052(h)(1) (Vernon Supp.2006). Spiritas owns multiple tracts⁴ included within this proposed fast-track annexation.⁵ In October 2006, in accordance with the statutorily-required annexation process applicable to fast-track annexations, the Town sent written notice to landowners of its intent to annex their properties. See id. § 43.062. Between November 1 and November 10, 2006, it posted public hearing notices in accordance with the statute. Id. § 43.063.

On November 6, 2006, Spiritas sent a letter to the Town asking that its property be included in the Town's three-year annexation plan rather than being annexed according to the fast-track procedures. The Town Council held public hearings on the fast-track annexation ordinance on November 21, 2006,⁶ but it did not vote on Spiritas's request at that time because there was not enough time to place it on the agenda. At a subsequent meeting on December 5, 2006, the Town Council voted not to include Spiritas's land in the three-year annexation plan and instead to proceed with the fast-track annexation of Spiritas's property. Accordingly, on December 6, 2006, Spiritas requested that the Town arbitrate the issue under section 43.052(i) of the local government code. Id. § 43.052(i). In a December 7, 2006 letter to Spiritas, the Town's attorney confirmed that the Council would consider whether to arbitrate at a meeting scheduled for December 19, 2006.

The agenda for the December 19 Council meeting was published on Friday, December 15, 2006. Item 11.e. was titled, "Discussion and consideration to adopt Ordinances No. 809 an Ordinance of the Town of Little Elm, Texas annexing territory described in Exhibit A attached hereto to the Town, and extending the boundary limits of the Town so as to include the said property within the corporation limits of the Town . . . ." Item 12 read as follows:

The Town Council will hold a Closed (executive) session meeting pursuant to the provisions of Chapter 551, Texas Government Code, . . . in accordance with the authority contained in:

Section 551.071 Consultation with Town Attorney to receive legal advice concerning Spiritas Ranch Enterprises L.L.P. request for arbitration petition regarding the Little Elm U.S. 380 annexation, and contemplated litigation.

Discussion and consideration to take any action necessary as the result of the Closed (executive) session:

Section 551.071 Consultation with Town Attorney to receive legal advice concerning Spiritas Ranch Enterprises L.L.P. request for arbitration petition regarding the Little Elm U.S. 380 annexation, and contemplated litigations.

The last page of the agenda contains a notation that "pursuant to the Texas Open Meeting Act . . ., one or more of the above items may be considered in executive closed session to the public. Any decision on any item will be taken or conducted in open session following the conclusion of the executive closed session." Accordingly, the agenda appeared to allow the Council to vote on whether Spiritas's property should be annexed before considering Spiritas's request to arbitrate the matter.

On Monday, December 18, 2006, Spiritas filed suit against the Town, asking for a declaratory judgment and a temporary and permanent injunction. More specifically, Spiritas asked the trial court to enjoin the Town from taking any action to directly or indirectly annex the property according to the fast-track annexation procedures until arbitration is completed under sections 43.052(i), 43.0565, and 43.0564 of the local government code. Id. §§ 43.052(i), .0565,.0564. Spiritas also filed an application for a TRO, asking the trial court to issue a TRO restraining the Town from directly or indirectly taking any steps to annex the property before notice could be given and a hearing held on Spiritas's temporary injunction request. That same day, the Town filed a response, the trial court held a hearing at which it heard argument from both parties, and the trial court denied the TRO application. Because the Town Council meeting was to occur at 7:00 p.m. the next day, Spiritas did not have enough time to schedule a hearing on its request for temporary injunctive relief. See TEX.R. CIV. P. 21 (requiring at least three days' notice of hearing unless shortened by trial court); Tex. Dep't of Parks & Wildlife v. Miranda, 133 S.W.3d 217, 229 (Tex. 2004) (noting rule 21's three-day notice period).

On December 19, 2006, Spiritas filed a petition for writ of mandamus, asking this court to compel the trial court to reverse its order denying the TRO and order the trial court to enter a TRO "maintaining the status quo" and "precluding the Town . . . from taking any action to annex the property until the trial court can determine the merits of Spiritas's temporary injunction request." Spiritas also requested that this court issue temporary emergency relief prohibiting the Town from taking any action to annex the property while Spiritas's petition was pending. After reviewing Spiritas's motion, petition, and a faxed response from the Town, we issued an order granting Spiritas's motion for emergency temporary relief.

In accordance with our order, the Town Council did not vote on the proposed fast-track annexation ordinance at the December 19 meeting. However, the Town did vote to arbitrate the dispute with Spiritas. On December 22, 2006, we received an Agreed Motion for Reciprocal Temporary Injunctive Relief in which the parties informed this court of an issue that had not yet been presented to this court or the trial court: that Spiritas had submitted two preliminary plat applications to the Town regarding the property included in the proposed fast-track annexation. Accordingly, the parties agreed that while this court's stay was in effect, not only would the Town be prohibited from taking any action to annex the property, but Spiritas would refrain from submitting any permit applications, except for the two pending preliminary plat applications, with respect to the property and from asserting any rights under section 43.002(a) of the local government code with respect to the two pending applications. TEX. LOC. GOV'T CODE ANN. § 43.002(a).

Because it was unclear whether the parties' agreement was intended to encompass the temporary injunctive relief requested by Spiritas in its original petition in the trial court, and because the issue had not been ruled upon by the trial court, we abated this original proceeding for the trial court to enter an order based on the parties' agreement. When we received a copy of the agreed order entered by the trial court,⁷ and subsequent correspondence from the parties related to other motions pending in this court, it became clear that the injunctive relief agreed to by the parties was applicable only during the pendency of this court's December 19 stay order and did not encompass the temporary injunctive relief requested by Spiritas in the trial court. Accordingly, it is necessary for us to address Spiritas's two issues: (1) whether the trial court abused its discretion by denying Spiritas's application for a TRO enjoining the Town from attempting to annex the property until an evidentiary hearing could be held on Spiritas's request for a temporary injunction and (2) whether Spiritas has an adequate remedy by appeal.⁸

In its response to Spiritas's petition for writ of mandamus, the Town contends that this court lacks jurisdiction over this original proceeding and that Spiritas lacks standing to bring it. Because an analysis of the jurisdictional and standing issues necessarily includes a discussion of the merits of Spiritas's complaint—and because we conclude that we have jurisdiction and that Spiritas has standing—we will review those typically threshold issues after we have reviewed the merits of Spiritas's complaint.

Standard of Review

Mandamus relief is proper only to correct a clear abuse of discretion when there is no adequate remedy by appeal. In re Prudential Ins. Co. of Am., 148 S.W.3d 124, 135-36 (Tex.2004) (orig.proceeding).

A trial court clearly abuses its discretion when it reaches a decision so arbitrary and unreasonable as to amount to a clear and...