South West Property v. Dallas County Flood

• Decision Date: 03 October 2001
• Docket Number: No. 05-97-00399-CV.,05-97-00399-CV.
• Citation: 136 S.W.3d 1
• Parties: SOUTH WEST PROPERTY TRUST, INC. and SWP Properties I, L.L.P., Appellants, v. DALLAS COUNTY FLOOD CONTROL DISTRICT NO. 1, Appellee.
• Court: Texas Court of Appeals

136 S.W.3d 1

SOUTH WEST PROPERTY TRUST, INC. and SWP Properties I, L.L.P., Appellants, v. DALLAS COUNTY FLOOD CONTROL DISTRICT NO. 1, Appellee.

No. 05-97-00399-CV.

Court of Appeals of Texas, Dallas.

October 3, 2001.

Supplemental Opinion on Overruling of Rehearing April 4, 2002.

Martin J. Lehman, Tim Kirk, Heather M. Harvey, Miller & Lehman, P.C., Dallas, for appellants.

James D. Blume, Blume & Stoddard, W. Alan Wright, LaDawn H. Conway, Haynes & Boone, L.L.P., Dallas, Joe Putnam, Irving, for appellee.

Before Justices KINKEADE, MOSELEY, and O'NEILL.

OPINION

MOSELEY, Justice.

South West Property Trust, Inc. ("South West") and SWP Properties I, L.L.P. ("SWP"), appeal a summary judgment granted in favor of the Dallas County Flood Control District, No. 1 ("District"). In nine points of error, South West and SWP assert, inter alia, that the trial court erred in granting the District's motion for summary judgment on their claims under the Private Real Property Rights Preservation Act ("Act"). TEX. GOV'T CODE ANN. §§ 2007.001-.045 (Vernon 2000). For the reasons set forth below, we reverse that portion of the summary judgment disposing of SWP's claims under the Act and remand those claims to the trial court for further proceedings. We vacate that portion of the summary judgment awarding attorney's fees against SWP and affirm the award of attorney's fees against South West. We affirm the remaining portion of the summary judgment.

BACKGROUND

The District is a conservation and reclamation district under article XVI, section 59 of the Texas Constitution. The District was originally created in 1976 by the Dallas County Commissioners Court and was subsequently validated by a special act of the Texas Legislature. See Act of June 1, 1987, 70th Leg., R.S., ch. 600, § 2, 1987 Tex. Gen. Laws 2350, 2352-55. The Legislature declared the District was a governmental agency and body politic. It also validated the boundaries of the District as set out in the deed records of Dallas County, and specifically found the property included in the District would benefit from the works and projects to be accomplished by the District.

The Texas Constitution expressly allows districts, such as the one before us, to issue bonds and levy taxes subject to voter approval. TEX. CONST. art. XVI, § 59. The Legislature authorized the District to issue bonds and levy and collect ad valorem taxes on all taxable property in the District. The Texas Water Code also expressly permits taxation on an ad valorem basis. TEX. WATER CODE ANN. § 57.251 (Vernon 1988). Both the Texas Constitution and the water code require that the level of taxation be sufficient to pay the interest on the bonds and to create a sinking fund sufficient to pay the bonds at maturity. TEX. CONST. art. XVI, § 59; TEX. WATER CODE ANN. § 57.251.

In 1982, the District's voters authorized the District to issue $19,250,000 in bonds and assess an ad valorem tax. In 1988, the District's taxpayers voted in favor of an additional $30,000,000 in bonds for flood control purposes. The bonds were approved by the attorney general and issued, and are now incontestable. After the bonds issued, the District levied taxes on property located within the District on an ad valorem basis to satisfy its obligations to the bondholders.

In June 1993, South West purchased an apartment complex located within the District. South West voluntarily paid the 1993 ad valorem taxes. In January 1994, South West transferred the property to SWP. SWP is wholly owned by South West.

In January 1995, South West and SWP filed suit against the District contesting the ad valorem tax. They complained their tax funds were being used for expenditures the District made in association with, but not in accordance with, a 1983 land reclamation plan ("Plan"). They further asserted SWP's property was not located in the flood plain and that the property received no benefit from the District's expenditure of bond funds. Appellants alleged the District's tax on SWP's property violated several provisions of the United States and Texas Constitutions and that the taxation constituted a "taking" under the Act. They sought a permanent injunction to prevent the District from collecting the taxes and a declaration that the ad valorem taxes were illegal and uncollectible. They also sought recovery of the 1993 taxes already paid. They did not complain about the inclusion of SWP's property in the District.

The District first moved for summary judgment under Texas Rule of Civil Procedure 166a(c), asserting South West lacked standing because it did not own property located in the District. The District also asserted that neither South West nor SWP could recover the 1993 taxes because the taxes were voluntarily paid. The trial court granted partial summary judgment, concluding South West had no standing to bring the suit and that any claim for a refund of the 1993 taxes was waived.

The District filed a second motion for summary judgment under Texas Rule of Civil Procedure 166a(c), seeking summary judgment as to SWP's remaining claims for declaratory and injunctive relief. The District asserted, among other things, that it was entitled to judgment as a matter of law because (1) the complained-of tax was required by law, (2) SWP cannot complain of past illegal expenditures, (3) the ad valorem tax was not unconstitutional, and (4) the tax was not a "taking" under the Act. The District again requested its reasonable and necessary attorney's fees. The trial court granted the District's second motion for summary judgment, rendered a final take-nothing judgment against appellants, and awarded the District its attorney's fees. The order granting summary judgment did not state the grounds upon which the trial court relied.¹

CLAIMS BY SOUTH WEST PROPERTY TRUST, INC.

The trial court's partial summary judgment disposed of South West's claims against the District on two grounds: that South West lacked standing to pursue the alleged claims and that any claim to recover the 1993 taxes was waived. This partial summary judgment was incorporated into and became a part of the final judgment. See H.B. Zachry Co. v. Thibodeaux, 364 S.W.2d 192, 193 (Tex.1963). Appellants have not challenged the partial summary judgment ruling disposing of South West's claims on the ground that it lacked standing. Therefore, we affirm the summary judgment disposing of South West's claims. See Malooly Bros., Inc. v. Napier, 461 S.W.2d 119, 121 (Tex.1970); Holloway v. Starnes, 840 S.W.2d 14, 23 (Tex.App.-Dallas 1992, writ denied). Accordingly, we address appellants' points of error one through five with respect to SWP only. See TEX.R.APP. P. 47.1.

CLAIMS BY SWP PROPERTIES I, L.L.P.

In its first five points of error, SWP contends the trial court erred in granting the District's motions for summary judgment. Specifically, it complains the trial court erred in granting the District summary judgment because: (1) the District failed to submit any evidence (other than an affidavit regarding attorney's fees) in support of its second motion for summary judgment; (2) the District failed to conclusively negate an element of each of SWP's causes of action; (3) the District failed to conclusively prove all elements of any properly pleaded affirmative defense; (4) the summary judgment evidence submitted by SWP created genuine issues of material fact; and (5) the grounds expressly raised by the District in its second motion for summary judgment are not legally sufficient defenses to SWP's causes of action.

Under these points of error, SWP asserts that (1) it did not lack standing, nor did it waive the right, to contest the levy of the 1993 taxes, (2) the levy of the ad valorem taxes violated SWP's substantive and procedural due process rights and constituted a denial of equal protection under the United States Constitution, (3) the levy of taxes violated the Texas constitutional requirement that taxes be uniform, levied for a public purpose, and equitably distributed and (4) the District's levy of taxes constituted a taking under the Act.

STANDARD OF REVIEW

The standards for reviewing a summary judgment are well established. The party moving for summary judgment has the burden of showing no genuine issue of material fact exists and it is entitled to judgment as a matter of law. See TEX.R. CIV. P. 166a(c); Nixon v. Mr. Prop. Mgmt. Co., 690 S.W.2d 546, 548 (Tex.1985); Swilley v. Hughes, 488 S.W.2d 64, 67 (Tex. 1972). A plaintiff moving for summary judgment must conclusively prove all essential elements of its claim. See MMP, Ltd. v. Jones, 710 S.W.2d 59, 60 (Tex.1986) (per curiam). A defendant moving for summary judgment must either (1) disprove at least one element of the plaintiff's theory of recovery, or (2) plead and conclusively establish each essential element of an affirmative defense. See City of Houston v. Clear Creek Basin Auth., 589 S.W.2d 671, 678-79 (Tex.1979); Zep Mfg. Co. v. Harthcock, 824 S.W.2d 654, 657 (Tex.App.-Dallas 1992, no writ).

1993 TAXES

SWP purports to challenge the District's first motion for summary judgment with respect to whether it waived its rights to contest the 1993 taxes already paid. The District asserts that, because SWP voluntarily paid the 1993 taxes, it waived any right to seek judicial relief from the assessment of those taxes. The District further claims SWP has no right to contest the taxes before or after paying them. SWP asserts that it is disingenuous to contend that by failing to exercise a right it did not have, SWP waived the right to contest the 1993 taxes. However, SWP provides no argument or authority to show that the summary judgment on this claim was improper. Therefore, we affirm the summary judgment against SWP with respect to waiver regarding the 1993 taxes. See TEX.R.APP. P. 38.1(h); Kang v. Hyundai Corp., 992 S.W.2d 499, 503 (Tex.App.-Dallas 1999, no pet.); State Farm Lloyds, Inc. v. Williams, 960 S.W.2d 781, 789 (Tex. App.-Dallas...