Town of Flower Mound v. Stafford Estates

• Decision Date: 14 February 2002
• Docket Number: No. 2-00-205-CV.,2-00-205-CV.
• Citation: 71 S.W.3d 18
• Parties: TOWN OF FLOWER MOUND, Texas, Appellant and Appellee, v. STAFFORD ESTATES LIMITED PARTNERSHIP, Appellee and Appellant.
• Court: Texas Court of Appeals

71 S.W.3d 18

TOWN OF FLOWER MOUND, Texas, Appellant and Appellee, v. STAFFORD ESTATES LIMITED PARTNERSHIP, Appellee and Appellant.

No. 2-00-205-CV.

Court of Appeals of Texas, Fort Worth.

February 14, 2002.

Rehearing Overruled March 14, 2002.

Bickerstaff, Heath, Smiley, Pollan, Kever & McDaniel, L.L.P., Robert F. Brown, Terrence S. Welch, Dallas, for appellant, Flower Mound.

Moseley & Standerfer, P.C., Gregory P. Standerfer, Bruce W. Bringardner, Dallas, for appellee, Stafford Estates.

Panel A: CAYCE, C.J.; DAY and WALKER, JJ.

OPINION

SUE WALKER, Justice.

I. Introduction.

In this development exaction case, the primary issue we must decide is whether the two-prong test articulated in Dolan v. City of Tigard, 512 U.S. 374, 114 S.Ct. 2309, 129 L.Ed.2d 304 (1994) applies to a municipality's requirement that a developer construct and pay for offsite public improvements as a condition to plat approval for subdivision development. We conclude that the Dolan test applies to the public improvements development exaction in this case and that the exaction does not satisfy the Dolan test.

We must also decide what is the proper measure of damages when a development exaction does not satisfy the Dolan test and whether a developer can recover attorney's fees and expert witness fees under United States Code section 1988 if a state remedy adequately compensates the developer for any taking resulting from the development exaction. We hold that the proper measure of damages is the amount paid for the public improvements in excess of the amount roughly proportional to the consequences generated by the development minus any special benefits conferred on the development by the exaction. Applying this measure of damages, we hold that legally and factually sufficient evidence exists supporting the trial court's damages award. We also hold that the developer cannot recover section 1988 expert witness fees and attorney's fees if the state remedy provides adequate compensation because, in this circumstance, the developer's federal takings claim is not ripe. Accordingly, we will affirm the trial court's judgment in part and reverse and render in part.

II. Background Facts.

The Town of Flower Mound ("Town") is a duly formed and validly existing home-rule city and a political subdivision of the State of Texas. In June 1994, the Town adopted its land development code. Section 4.04 of the land development code addresses standards for streets located within the Town. Section 4.04(b) requires all developers "to construct concrete streets according to the Engineering Standards Manual." Section 4.04(o) sets out the requirements a developer must satisfy when developing a subdivision abutting a street that does not meet the Town's minimum street design standards.¹ Section 4.04(a) allows developers to apply for and the Town Council to grant exceptions to the street design standards.²

Stafford Estates Limited Partnership ("Stafford") is a Texas limited partnership that purchased approximately 90 acres of vacant and unimproved land in the Town between 1994 and 1997 ("the Property"). The Property is generally located at the southeast corner of the intersection of two of the Town's roads: McKamy Creek Road and Simmons Road. Between 1994 and 1997, Stafford applied for, and the Town approved, three phases of a residential subdivision on the Property known as Stafford Estates ("the Subdivision"). The Subdivision contains approximately 247 single-family lots. Phase I of the Subdivision abuts McKamy Creek Road, and Phases II and III abut Simmons Road. All three phases have vehicular access to and from both McKamy Creek and Simmons Roads.

At the time Stafford acquired its interest in the Property, Simmons Road was an existing two-lane asphalt road, which was adjacent to the proposed Subdivision, but not part of the Property. Simmons Road was designated as a rural collector roadway on the Town's thoroughfare plan.

In December 1995, Stafford applied for record plat approval for Phase II of the Subdivision. As a condition to plat approval, the Town required Stafford to demolish the part of Simmons Road that abutted Phase II, replace it with a two-lane concrete road with three-foot concrete shoulders, and pay 100% of the cost of these improvements. The Town denied Stafford's request for an exception from this requirement.

In April 1997, Stafford applied for record plat approval for Phase III of the Subdivision. The town initially approved the record plat for Phase III without any obligation that Stafford improve Simmons Road. However, several weeks later at a preconstruction conference, the Town informed Stafford that Stafford would be required to improve the portion of Simmons Road that abutted Phase III in the same manner as had been required for Phase II and to again bear 100% of the cost.

At every administrative level within the Town, Stafford objected, unsuccessfully, to the Town's requirement that Stafford construct and pay for 100% of the Simmons Road improvements. The Town's land development code did not, however, require Stafford to sue to challenge this condition before receiving record plat approval, and Stafford did not sue before obtaining plat approval or constructing the improvements.

III. Procedural History.

In 1998, after completing construction of the Simmons Road improvements, Stafford sued the Town, contending that the plat approval condition was a taking without just compensation in violation of article I, section 17 of the Texas Constitution and the Fifth and Fourteenth Amendments of the United States Constitution. Stafford later amended its pleadings to drop its Fourteenth Amendment claim and to assert an additional takings claim under section 1983 of the United States Code. Stafford's amended pleading also sought attorney's fees and expert witness fees under section 1988 of the United States Code.

The liability phase of the trial was tried to the court based on stipulated facts, and the parties also stipulated that Stafford's takings claims under the Texas Constitution, the Fifth Amendment, and section 1983 would be the claims tried during this phase. At the close of the liability phase, the trial court entered a judgment as to liability in Stafford's favor on all three of its takings claims. The trial court then heard evidence on damages, expert witness fees, attorney's fees, and costs and rendered a final judgment awarding Stafford damages, expert witness fees, attorney's fees, and costs. This appeal followed.

IV. Standards of Review.

With the exception of the Town's sufficiency challenges to the amount of Stafford's damages award, the issues presented for our review are all questions of law. See Weingarten Realty Investors v. Albertson's, Inc., 66 F.Supp.2d 825, 843 (S.D.Tex.1999) (holding that whether there has been a taking is a legal issue), aff'd, 234 F.3d 28 (5th Cir.2000); Mayhew v. Town of Sunnyvale, 964 S.W.2d 922, 928, 932-33 (Tex.1998) (holding that whether there has been a taking and whether federal takings claim is ripe are questions of law), cert. denied, 526 U.S. 1144, 119 S.Ct. 2018, 143 L.Ed.2d 1030 (1999); Allied Vista, Inc. v. Holt, 987 S.W.2d 138, 141 (Tex. App.-Houston [14th Dist.] 1999, pet. denied) (stating that the correct measure of damages to be applied is a question of law). Accordingly, we will apply a de novo standard of review to the trial court's legal conclusions on these issues. See Garner v. Long, 49 S.W.3d 920, 922 (Tex.App.-Fort Worth 2001, pet. denied); Hitzelberger v. Samedan Oil Corp., 948 S.W.2d 497, 503 (Tex. App.-Waco 1997, pet. denied).

We review the Town's sufficiency challenges to Stafford's damages award under the traditional no-evidence and insufficient evidence standards. See, e.g., Cont'l Coffee Prods. Co. v. Cazarez, 937 S.W.2d 444, 450 (Tex.1996) (applying no-evidence standard of review); Garza v. Alviar, 395 S.W.2d 821, 823 (Tex.1965) (applying insufficient evidence standard of review). We will sustain a no-evidence challenge only when, considering only the evidence and inferences that tend to support the finding and disregarding all contrary evidence and inferences, the record discloses: (1) a complete absence of evidence of a vital fact; (2) the court is barred by rules of law or evidence from giving weight to the only evidence offered to prove a vital fact; (3) the evidence offered to prove a vital fact is no more than a mere scintilla of evidence; or (4) the evidence establishes conclusively the opposite of a vital fact. Uniroyal Goodrich Tire Co. v. Martinez, 977 S.W.2d 328, 334 (Tex.1998), cert. denied, 526 U.S. 1040, 119 S.Ct. 1336, 143 L.Ed.2d 500 (1999). We review a factual sufficiency challenge by examining all of the evidence to determine whether the evidence supporting the finding is so weak or the evidence to the contrary is so overwhelming that the finding should be set aside and a new trial ordered. Garza, 395 S.W.2d at 823.

V. Waiver of Suit.

In its fifth issue on appeal, the Town asserts that Stafford is barred from challenging the Simmons Road improvements as a condition to plat approval because Stafford did not sue to challenge the requirement before obtaining final plat approval from the Town. The Town contends that, because Stafford sought to receive the benefit of plat approval without first filing suit, Stafford has consented to the condition, has waived any challenge to it, and should be estopped from challenging it.

The Town has not directed us to any Texas law that would require a landowner to sue to challenge a condition to plat approval before obtaining final approval of the plat. Instead, the Town relies on Minnesota and California cases in which the courts held that a developer must challenge the reasonableness of conditions to plat approval before obtaining final plat approval or the challenge is waived. See Selby Realty Co. v. City of San Buenaventura, 10 Cal.3d 110, 109 Cal.Rptr. 799, 514 P.2d 111, 122 (1973); Crystal Green v....