T & R Associates, Inc. v. City of Amarillo

• Decision Date: 21 January 1985
• Docket Number: No. 07-83-0217-CV,07-83-0217-CV
• Parties: T & R ASSOCIATES, INC. D/B/A Scarlett O'Hara's, Appellant, v. CITY OF AMARILLO, Appellee.
• Court: Texas Court of Appeals

Page 622

688 S.W.2d 622

T & R ASSOCIATES, INC. D/B/A Scarlett O'Hara's, Appellant, v. CITY OF AMARILLO, Appellee.

No. 07-83-0217-CV.

Court of Appeals of Texas Amarillo.

Jan. 21, 1985.

Rehearing Denied Feb. 11, 1985.

Judge & Russ, John Judge, Amarillo, for appellant.

Underwood Law Firm, C.A. Stein and Josiah M. Daniel, III, Merril E. Nunn, City Atty., Amarillo, for appellee.

Before REYNOLDS, C.J., and COUNTISS and BOYD, JJ.

BOYD, Justice.

Appellant T & R Associates, Inc. d/b/a Scarlett O'Hara's (herein T & R) brings this appeal from a summary judgment that it take nothing on its counterclaim for money damages against appellee City of Amarillo (herein City). The action originated in the form of a counterclaim by T & R in a suit filed by the City seeking to enjoin the continued operation of a lounge known as Scarlett O'Hara's. In the counterclaim, T & R sought damages to which it was assertedly entitled under both state law and 42 U.S.C. § 1983 (Supp.1984). T & R asserted the City, by seeking the injunction and by denying T & R's application for a specific use permit to continue operation of the lounge within a general retail district, in addition to violating state law, denied T & R "its due process of law as guaranteed by the Fifth and Fourteenth Amendments to the Constitution of the United States." On November 6, 1981, the trial court entered an interlocutory summary judgment that T & R take nothing on its counterclaim. On June 1, 1983, an order was entered severing the counterclaim from the other matters raised in the litigation. Hence, this appeal. We affirm the action of the trial court.

The record reveals that T & R is a Texas corporation which operated the lounge in question at Space 15-A in the Sunset Center mall in Amarillo. The original tenant of the space sold both prepared food and beverages. However, between that time and the date of acquisition of the premises by T & R, some of the interim tenants had dropped the food service portion. During that period of time, each of the tenants did have a liquor license from the State of Texas, although the nature of such licenses is not shown. On November 16, 1978, officials of the City notified T & R that its operation without food service was in violation of the City's zoning ordinance. Upon being so informed, T & R made application with the City for a specific use permit which would allow the continued operation of the lounge. Although the Planning and Zoning Commission recommended approval of the permit, after a public hearing, the City Commission denied the application.

In its first three points, T & R contends the refusal by the City of its specific use permit denied it due process of law. In the first point, it contends this was effectuated by the consideration by members of the Amarillo City Commission of "secret evidence" received outside the City's duly constituted hearing procedure. In its second and third points, T & R contends that this denial was accomplished by the failure of the City to follow what T & R denominates as guidelines set out in Amarillo, Tex., Code of Ordinances § 26-22.

In discussing these points, we initially note the litany of legal guidelines to be observed by this Court in the determination of summary judgment appeals. A summary judgment should be affirmed only if the summary judgment record establishes a right thereto as a matter of law, and the movant must establish that it is entitled to the judgment by reason of the matters set out in the motion. City of Houston v. Clear Creek Basin Authority, 589 S.W.2d 671, 678 (Tex.1979); Harrington v. Young Men's Christian Ass'n of Houston, 452 S.W.2d 423, 424 (Tex.1970); Gibbs v. General Motors Corporation, 450 S.W.2d 827, 828 (Tex.1970). The burden of demonstrating the lack of a genuine issue of material fact is upon the movant and all doubts are resolved against him. Womack v. Allstate Insurance Company, 156 Tex. 467, 296 S.W.2d 233, 235 (1957); Durham v. Cannan Communications, Inc., 645 S.W.2d 845, 852 (Tex.App.--Amarillo 1983, writ dism'd); Lindley v. Smith, 524 S.W.2d 520, 523 (Tex.Civ.App.--Corpus Christi 1975, no writ).

Furthermore, we note that it is well established that regulation of the sale of alcoholic beverages through zoning ordinances is a proper exercise of a city's police powers. Eckert v. Jacobs, 142 S.W.2d 374, 376-77 (Tex.Civ.App.--Austin 1940, no writ). See also Deckard v. City of Port Lavaca, 491 S.W.2d 748, 751 (Tex.Civ.App.--Corpus Christi 1973, no writ). The rationale for this has been expressed as that the sale of intoxicants is accompanied with objections not present in other types of commercial enterprises, and that fact constitutes valid grounds for a separate classification or prohibition thereof in a given commercial area, for the protection of the health, morals, safety, peace and convenience of the public. Eckert v. Jacobs, 142 S.W.2d at 377.

The adoption and amendment of zoning ordinances is an exercise of the legislative power of the City. City of Waxahachie v. Watkins, 154 Tex. 206, 275 S.W.2d 477, 480 (1955); Sherwood Lanes, Inc. v. City of San Angelo, 511 S.W.2d 597, 599 (Tex.Civ.App.--Austin 1974, writ ref'd n.r.e.). The issuance of a specific use permit such as here sought would constitute an amendment of the zoning ordinance. See City of Lubbock v. Whitacre, 414 S.W.2d 497, 499 (Tex.Civ.App.--Amarillo 1967, writ ref'd n.r.e.). A city ordinance is presumed to be valid and this presumption applies to amendatory zoning ordinances as well as original comprehensive zoning ordinances. Hunt v. City of San Antonio, 462 S.W.2d 536, 539 (Tex.1971).

Therefore, a city council, acting in its legislative capacity may determine in the first instance whether or not facts exist warranting a classification and its determination of that issue cannot be disturbed in the absence of a clear showing that there is no reasonable basis therefor. It will be presumed, in the absence of a clear showing to the contrary, that in making that decision, the governing body had sufficient reason, in view of local conditions, to make the decision they have made. City of Dallas v. Lively, 161 S.W.2d 895, 898 (Tex.Civ.App.--Dallas 1942, writ ref'd). The burden of proof falls upon the party complaining of the decision to show that the decision amounted to a clear abuse of municipal discretion. Hunt v. City of San Antonio, 462 S.W.2d at 539. That burden has been described as "extra-ordinary" and requires a showing that no conclusive or even controversial or issuable facts exist which would justify the decision of the municipality. Thompson v. City of Palestine, 510 S.W.2d 579, 581 (Tex.1974); City of Bellaire v. Lamkin, 159 Tex. 141, 317 S.W.2d 43, 45 (1958); City of Waxahachie v. Watkins, 275 S.W.2d at 480. The decision as to whether the action of the municipality was an abuse of its discretion is a question of law for the court, and in deciding that question, the court must have due regard to all the circumstances of the city, the object sought to be attained and the necessity existing for the ordinance. City of Bellaire v. Lamkin, 317 S.W.2d at 45; Edge v. City of Bellaire, 200 S.W.2d 224, 227 (Tex.Civ.App.--Galveston 1947, writ ref'd).

In support of its argument that "secret" evidence was received and considered by the City Commission in making its decision, T & R cites statements made in depositions by Mayor Jerry H. Hodge and Commissioner J. Dean Christy. In Hodge's case, that reference was to the fact that a previous owner of the property had told him that he had informed the owners of T & R that "they had a restaurant permit" and "if they removed that kitchen they would be in trouble." When queried as to whether that conversation was "a part of your decision making process," Hodge replied, "It certainly was, that and the fact that they had been in violation, and it's our responsibility as ... the ultimate responsibility of the City Commission to approve zoning, regardless whether it's in agreement with the Planning and Zoning Commission nor [sic] the city staff, and we have that responsibility and obligation."

In Christy's instance, the challenged statement was made in the course of a rambling answer concerning a comment Christy had made at the conclusion of the public hearing on the specific use permit. In that comment, he made reference to the fact that some innuendos and remarks had been made about the applicants that he did not appreciate. In his answer Christy said he was referring to the fact that name calling and innuendos weren't pertinent to the subject and "the crux of the matter, as I saw it, was strictly this, and the reason I voted as I did, there was an establishment in operation in violation of city codes. That was a foregoing fact, that was clear cut." He then stated he thought "people" should have had "a right at the time that the zoning was changing to permit this establishment to either protest or not protest" and that they "had been denied that right." The remainder of the answer, and the challenged portion was as follows:

The one other thing that bothered me along these lines, is the fact that some $35,000 worth of improvements were done without a permit. I was told, and now this is heresay [sic], that the reason no permit was gotten was that they knew that they could not get a permit for this type of remodeling due to the fact that a permit would not have been granted therefore, they went ahead with some $35,000 worth of remodeling without a city permit, in violation of another city ordinance. This is what I was told.

We do not believe these references require reversal. While a public hearing is required by Tex.Rev.Civ.Stat.Ann. art. 1011d (Vernon 1963), that hearing is legislative rather than judicial in nature. Lawton v. City of Austin, 404 S.W.2d 648, 651 (Tex.Civ.App.--Austin 1966, writ ref'd n.r.e.). It is not required that the decision of the City Commission be made solely on the basis of evidence produced at the hearing....