MJR'S Fare of Dallas, Inc. v. City of Dallas

• Decision Date: 21 June 1990
• Docket Number: No. 05-89-00765-CV,05-89-00765-CV
• Parties: MJR'S FARE OF DALLAS, INC. d/b/a, The Fare, et al., Appellants, v. The CITY OF DALLAS, Appellee.
• Court: Texas Court of Appeals

Page 569

792 S.W.2d 569

MJR'S FARE OF DALLAS, INC. d/b/a, The Fare, et al., Appellants, v. The CITY OF DALLAS, Appellee.

No. 05-89-00765-CV.

Court of Appeals of Texas,

Dallas.

June 21, 1990.

Rehearing Denied July 12, 1990.

Steven H. Swander, Dallas, for appellants.

Sally Jo Field, Dallas, for appellee.

Before STEWART, THOMAS and KINKEADE, JJ.

OPINION ON REHEARING

KINKEADE, Justice.

The City of Dallas filed a motion for rehearing contending that the doctrines of res judicata and collateral estoppel bar plaintiffs' claims. Because we agree with the City of Dallas, we grant its motion, withdraw our February 26, 1990 opinion, and vacate the judgment entered on that same date. The following is now the opinion of this Court.

MJR's Fare of Dallas, Inc. d/b/a The Fare and other existing businesses (collectively "MJR") appeal the granting of a declaratory judgment upholding the constitutionality of amended City of Dallas Zoning Ordinance No. 19196 (the "Ordinance"). MJR argues that the trial court erred when it found that the doctrines of res judicata and/or collateral estoppel barred MJR's claims in the instant case. MJR further argues that the Ordinance violates the Texas Constitution since: (1) the distance restrictions exceed Dallas's delegated zoning authority and result in an unlawful taking; (2) the female gender-based classifications conflict with the Equal Rights Amendment; and (3) prior law already provides similar regulations and thus preempts the Ordinance. Finally, MJR argues that the Ordinance's substantially overbroad definition of nudity violates the United States Constitution.

Res Judicata/Collateral Estoppel

In its first point of error, MJR contends that the trial court erred when it held that a prior federal declaratory judgment, which involved MJR making facial challenges to the same ordinance under attack in this case, precludes MJR's recovery in this suit pursuant to the doctrines of res Because MJR originally challenged the Ordinance in federal court, the state court must apply federal law to determine whether res judicata bars the facial challenges made in the instant case. Jeanes v. Henderson, 688 S.W.2d 100, 103 (Tex.1985). In its federal court action, MJR sought a declaratory judgment and injunctive relief pursuant to the Federal Declaratory Judgment Act. See 28 U.S.C. §§ 2201 and 2202. The rules of res judicata actually comprise two doctrines concerning the preclusive effect of a prior adjudication. The first such doctrine is "claim preclusion," or true res judicata. It treats a judgment, once rendered, as the full measure of relief to be accorded between the same parties on the same "claim" or "cause of action." The effect of a judgment extends to litigation of all issues relevant to the same claim between the same parties, whether or not raised at trial. Kaspar Wire Works, Inc. v. Leco Eng'g & Mach., Inc., 575 F.2d 530, 535 (5th Cir.1978).

judicata and/or collateral estoppel. MJR asserts that it now for the first time facially challenges the Ordinance for violations of the Texas Constitution, while in the prior federal case it only facially challenged the Ordinance for violations of the United States Constitution. Further, MJR asserts that it bases its United States Constitutional challenges to the Ordinance in the instant case on overbreadth, alleging that the Ordinance includes more activities than Dallas may permissibly regulate, rather than vagueness as it urged in the federal court proceedings. Finally, MJR contends that, because Dallas amended the Ordinance's nudity definition subsequent to the federal court decision, MJR can now challenge this amended definition under the United States Constitution.

The second doctrine, collateral estoppel or "issue preclusion," recognizes that suits addressed to particular claims may present issues relevant to suits on other claims. In order to effectuate the public policy in favor of minimizing redundant litigation, issue preclusion bars the relitigation of issues actually adjudicated, and essential to the judgment, in a prior litigation between the same parties. Kaspar, 575 F.2d at 535-36. The law instills a declaratory judgment with the full force and effect of a final judgment and shall be reviewable as such. Kaspar, 575 F.2d 530 at 535-37; 28 U.S.C. § 2201.

The trial court stated in its conclusions of law that the prior federal declaratory judgment was rendered by a court of competent jurisdiction and that such judgment was final in its holding on the merits that all provisions of the Ordinance are constitutional. The trial court further stated that the cause of action involved in the prior federal proceeding and the cause of action before the court were the same. We agree with the trial court's conclusion that the doctrines of res judicata and collateral estoppel bar MJR's claims, and we sustain the City of Dallas's assignment of error on rehearing. However, out of an abundance of caution, the trial court also addressed MJR's constitutional challenges to the Ordinance and found the Ordinance did not violate either the Texas or United States Constitutions. Because we agree with the trial court's determinations, we affirm the trial court's judgment on all issues.

Facts

MJR, a business licensed by the Texas Alcoholic Beverage Commission, regularly features topless dancers as entertainment for its customers. On June 12, 1986, the Dallas City Plan Commission began review of proposed Ordinance No. 19196. This proposed Ordinance sought to add the classification, "Sexually Oriented Businesses", to the comprehensive zoning ordinance of Dallas which provides for licensing and distance restrictions applicable to existing businesses like MJR. In reviewing the proposed Ordinance, the plan commission considered numerous studies from various cities. These studies primarily focused on the relationships among concentrations of sexually oriented businesses, crime, and property values. Although the plan commission did not undertake a similar study of Dallas, it did consider a map of Dallas that indicated areas in which sexually oriented businesses could locate under the proposed Ordinance. Additionally, the plan On June 18, 1986, the Dallas City Council considered, in addition to the studies presented to the plan commission and their recommendation, a study prepared by the Dallas Police Department which compared crime rates in two commercial sections of Dallas, one with sexually oriented businesses and one without any of those establishments. The police study showed a 90 percent higher crime rate in the district with the sexually oriented businesses. The council also heard public testimony in favor of the proposed Ordinance. After considering all this information, the council unanimously voted to enact the Ordinance.

commission heard public testimony from individuals and groups which both supported and opposed the proposed Ordinance. Subsequently, the plan commission voted unanimously to recommend adoption of an ordinance that regulated sexually oriented businesses.

Zoning Authority

In its third point of error, MJR contends that the Ordinance's distance restrictions violate the Texas Constitution because the restrictions exceed the authority delegated to Dallas by the Zoning Enabling Acts and the Alcoholic Beverage Code. The Zoning Enabling Acts (the "Acts") grant a municipality the power to divide a city into zoning districts and to regulate the use of buildings within those districts. See TEX.LOCAL GOV'T.CODE ANN. §§ 211.001-211.013 (Vernon 1988). MJR argues, however, that the Acts fail to specifically grant a city the power to provide distance restrictions regardless of a building's district. Further, MJR argues that the Alcoholic Beverage Code regulates the location restrictions applicable to nightclubs serving alcoholic beverages. See TEX.ALCO.BEV.CODE ANN. § 109.31 (Vernon 1978) and § 109.33 (Vernon Supp.1990). Accordingly, MJR asserts that this attempt by Dallas to use its zoning power to implement location restrictions conflicts with these state statutes and thus violates the Texas Constitution. See TEX.CONST. art. XI, § 5.

MJR misconstrues the powers available to Dallas, a home-rule city. A home-rule city acts by constitutional authority rather than through power conferred on it by the legislature. City of El Paso v. State ex rel. Town of Ascarate 209 S.W.2d 989, 994 (Tex.Civ.App.--El Paso 1947, writ ref'd). Home-rule cities possess the full power of self-government and look to acts of the legislature not for grants of power, but only for limitations on their powers. City of Corpus Christi v. Continental Bus Systems, Inc., 445 S.W.2d 12, 17 (Tex.Civ.App.--Austin 1969), writ ref'd n.r.e., per curiam 453 S.W.2d 470 (Tex.1970). When the constitution addresses questions that deal with public safety, health, morals, general welfare, and questions properly within the scope of the city's police power, it vests home-rule cities with broad discretion. John v. State, 577 S.W.2d 483, 484-85 (Tex.Crim.App.1979); Driggs v. City of Denison, 420 S.W.2d 446, 448 (Tex.Civ.App.--Dallas 1967, no writ). The Ordinance in question here sought to protect the public safety through decreased crime rates and to promote the general welfare through the protection of property values and elimination of urban blight. Dallas possessed the power to enact just this type of ordinance.

MJR also argues that the language in the Ordinance conflicts with the language contained in the Zoning Enabling Acts. The pertinent part of the statute provides that "a municipality may divide the municipality into districts" and "[w]ithin each district, the governing body may regulate the erection, construction, reconstruction, alteration, repair, or use of buildings, other structures, or land." TEX.LOCAL GOV'T.CODE ANN. § 211.005(a) (Vernon 1988) (formerly TEX.REV.CIV.STAT.ANN. art. 1011b (Vernon 1964)). Since Dallas possesses the powers of a home-rule city and the statute...