Weingarten Realty Investors v. Albertson's, Inc.

Decision Date24 September 1999
Docket NumberNo. Civ.A. H-98-0912.,Civ.A. H-98-0912.
Citation66 F.Supp.2d 825
CourtU.S. District Court — Southern District of Texas

Billy Edward Williamson, Dow Cogburn & Friedman, Houston, TX, for Weingarten Realty Investors, plaintiff.

Brian F Antweil, Winstead Sechrest & Minick, Houston, TX, for Albertson's Inc, defendant.

Brian F Antweil, Winstead Sechrest & Minick, Houston, TX, for Albertson's Inc., counter-claimant.

Billy Edward Williamson, Dow Cogburn & Friedman, Houston, TX, for Weingarten Realty Investors, counter-defendant.


CRONE, United States Magistrate Judge.

Pending before the court is Defendant Albertson's, Inc.'s ("Albertson's") Motion for Interlocutory Summary Judgment (# 23), Plaintiff Weingarten Realty Investors's ("Weingarten") Motion for Partial Summary Judgment (# 31), and Plaintiff Weingarten's Motion for Summary Judgment on all Liability Issues (# 41). Having reviewed the pending motions, the submissions of the parties, the pleadings, and the applicable law, this court is of the opinion that Albertson's motion for interlocutory summary judgment should be granted, Weingarten's motion for partial summary judgment should be denied, and Weingarten's motion for summary judgment on all liability issues should be granted in part and denied in part.

I. Background

On July 28, 1988, Weingarten's predecessor, Weingarten/Lubbock, Inc., as landlord, entered into a document entitled "Lease Contract" with Albertson's predecessor in interest, Furr's, Inc. ("Furr's"), as tenant, for commercial space in the Town & Country Shopping Center in Lubbock, Texas. On October 7, 1991, pursuant to an assignment from Furr's, Albertson's assumed all liabilities and rights of the tenant under the Lease Contract.

The Lease Contract provides for a primary term of fifteen years, ending on June 30, 2004, with an option to extend the term for three additional sixty-month periods. Under Article VII of the Lease Contract, Weingarten, as landlord, is obligated to provide a "Common Area" in the shopping center and to make necessary repairs to such area. The Common Area includes parking spaces for customers and employees of the tenants, service drives and roads, traffic islands, loading and service areas, sidewalks, landscaped areas, roofs, gutters and downspouts, and sprinkler risers. In addition, Weingarten agrees not to make any changes to certain portions of the Common Area without the consent of the tenant. The tenant is obligated to pay a "Common Area Payment" as additional rent to cover a proportionate share of the "Common Area Operating Costs" plus an administrative fee. In Article VIII, the tenant, after once opening a supermarket in the leased premises, is given the right, after 150 days' prior written notice to the landlord, to cease operations and discontinue conducting the supermarket business, but nevertheless remains obligated to perform all covenants and agreements under the Lease Contract, including the payment of rent. Under Article XVI, "[f]ailure or refusal by Tenant to timely pay Minimum Rent or Percentage Rent or any other sum when due hereunder" is designated an "Event of Default." Article XIX of the Lease Contract addresses the issue of eminent domain:


Eminent Domain

Section 19.01. If there shall be taken during the term of this Lease any portion of the Leased Premises, by any authority having the power of eminent domain, then and in that event, the term of this Lease shall cease and terminate, and the date of such termination shall be, at Landlord's or Tenant's election, the earlier of either the date upon which possession shall be tendered to such authority by Landlord or the date upon which possession is taken by such authority.

Section 19.02. Whether or not any portion of the Leased Premises may be taken by such authority, either Landlord or Tenant may nevertheless elect to terminate this Lease or to continue this Lease in effect in the event any portion of any building in the portion of the Shopping Center outlined in green, or more than twenty five percent (25%) of the Common Area of the Shopping Center be taken by such authority.

Section 19.03. Separate awards for damages to the respective interests of Landlord and Tenant shall be made, and each shall be entitled to receive and retain such awards as shall be made to it, and the termination of this Lease shall not affect the rights of the respective parties to the awards. In addition Tenant shall be entitled to a portion of any award to Landlord for improvements comprising the Leased Premises taken in such amount as necessary to enable Tenant to recover any unrecovered amount of its certified cost and accrued interest on the new addition added by Tenant.

In 1996, the Texas Department of Transportation ("TxDOT") gave notice of its intent to initiate condemnation proceedings for a substantial portion of the shopping center's parking lot needed for expansion of U.S. Highway 82 into a controlled access, east-west freeway through Lubbock. On October 21, 1996, TxDOT sent a letter to Albertson's advising that "[t]his Department assists persons displaced by the purchase of land for highway purposes through our `"Relocation Assistance Program,"'" summarizing the highlights of the program. By letter to Albertson's dated December 30, 1996, TxDOT "acknowledge[d] your lessee's interest in the property" and advised that "[Albertson's], and the other affected tenants, will be joined in our condemnation suit." On April 23, 1997, TxDOT forwarded a quitclaim deed to Albertson's, explaining that if it wished to be excluded from potential condemnation proceedings, it could sign the deed releasing its interest in the property to be condemned, but Albertson's declined to do so. On July 17, 1997, TxDOT sent correspondence to Albertson's entitled "Proposed Condemnation Proceedings," informing Albertson's that it was "being joined as a party to the State's condemnation proceedings," noting that it could avoid being named a party by signing the quitclaim deed.

Nevertheless, on August 18, 1997, Weingarten, in lieu of condemnation proceedings, agreed to convey the property to TxDOT for the sum of $8,475,000.00, as set forth in a "Memorandum of Agreement" dated August 14, 1997, and a "Settlement Agreement" executed August 18, 1997, between Weingarten and TxDOT. On that same day, Weingarten executed and acknowledged a deed conveying the necessary right-of-way to the State. The following day, the deed was delivered to the Stewart Title Company, which had been designated by TxDOT as "the State's closing agent" in the Memorandum of Agreement. The deed was recorded on August 26, 1997. Also on August 26, Weingarten signed and acknowledged a document entitled "Lease Agreement," whereby TxDOT leased the conveyed right-of-way to Weingarten for a maximum term of four years, subject to cancellation by either party upon twelve months' written notice. On September 26, 1997, TxDOT sent Albertson's a notice entitled "Cancellation of Proposed Condemnation Proceedings," informing Albertson's that "the State did not have to file condemnation proceedings for the acquisition of the subject parcel of land."

Albertson's sent written notice to Weingarten on November 25, 1997, terminating the Lease Contract under Article XIX and requesting its share of the eminent domain proceeds. Albertson's ceased operations at the site and vacated the shopping center on November 28, 1997. On January 27, 1998, TxDOT forwarded to Albertson's a form entitled "Claim for Actual Moving Expenses" pursuant to the State's Relocation Assistance Program. Albertson's subsequently submitted a claim and was paid $91,023.00 for its moving expenses. Weingarten, after several attempts to resolve this dispute, sent a notice of default to Albertson's on February 5, 1998. On March 31, 1998, Weingarten instituted this breach of contract action to collect unpaid rent and other damages, along with attorneys' fees and costs. Albertson's filed a counterclaim asserting claims for declaratory relief, civil rights violations, and breach of contract, seeking the recovery of actual and punitive damages, as well as attorneys' fees and costs.

II. Analysis
A. Summary Judgment Standard

Rule 56(c) of the Federal Rules of Civil Procedure provides that summary judgment "shall be rendered forthwith if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue of material fact and that the moving party is entitled to judgment as a matter of law." FED.R.CIV.P. 56(c). The party seeking summary judgment bears the initial burden of informing the court of the basis for its motion and identifying those portions of the pleadings, depositions, answers to interrogatories, admissions on file, and affidavits, if any, which it believes demonstrate the absence of a genuine issue of material fact. See Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986); Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-48, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986); Colson v. Grohman, 174 F.3d 498, 506 (5th Cir.1999); Marshall v. East Carroll Parish Hosp. Serv. Dist., 134 F.3d 319, 321 (5th Cir.1998); Wenner v. Texas Lottery Comm'n, 123 F.3d 321, 324 (5th Cir.1997), cert. denied, 523 U.S. 1017, 118 S.Ct. 1514, 140 L.Ed.2d 667 (1998). The moving party, however, need not negate the elements of the nonmovant's case. See Wallace v. Texas Tech Univ., 80 F.3d 1042, 1047 (5th Cir.1996) (citing Little v. Liquid Air Corp., 37 F.3d 1069, 1075 (5th Cir. 1994)).

Once a proper motion has been made, the nonmoving party may not rest upon mere allegations or...

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