Whittington v. City of Austin

• Decision Date: 29 January 2015
• Docket Number: NO. 03–13–00410–CV,03–13–00410–CV
• Citation: 456 S.W.3d 692
• Parties: Harry M. Whittington; Mercedes B. Whittington; Mercedes Gregg f/k/a Mercedes Whittington, individually and as trustee of the Margaret Lynn Puckett 1989 Trust, the Sara Whittington May 1989 Trust, the Caroline Elizabeth Puckett 1989 Trust, the Michael Erskine May 1989 Trust, the Camille Meriwether May 1989 Trust, and the William Tyndale Puckett, Jr. 1989 Trust; Sally Whittington May, individually and as trustee of the Margaret Lynn Puckett 1989 Trust, the Sara Whittington May 1989 Trust, the Caroline Elizabeth Puckett 1989 Trust, the Michael Erskine May 1989 Trust, the Camille Meriwether May 1989 Trust, and the William Tyndale Puckett, Jr. 1989 Trust; and Margaret Whittington Puckett, individually and as trustee of the Margaret Lynn Puckett 1989 Trust, the Sara Whittington May 1989 Trust, the Caroline Elizabeth Puckett 1989 Trust, the Michael Erskine May 1989 Trust, the Camille Meriwether May 1989 Trust, and the William Tyndale Puckett, Jr. 1989 Trust, Appellants, City of Austin, Cross–Appellant, v. City of Austin, Appellee Harry M. Whittington; Mercedes B. Whittington; Mercedes Gregg f/k/a Mercedes Whittington, individually and as trustee of the Margaret Lynn Puckett 1989 Trust, the Sara Whittington May 1989 Trust, the Caroline Elizabeth Puckett 1989 Trust, the Michael Erskine May 1989 Trust, the Camille Meriwether May 1989 Trust, and the William Tyndale Puckett, Jr. 1989 Trust; Sally Whittington May, individually and as trustee of the Margaret Lynn Puckett 1989 Trust, the Sara Whittington May 1989 Trust, the Caroline Elizabeth Puckett 1989 Trust, the Michael Erskine May 1989 Trust, the Camille Meriwether May 1989 Trust, and the William Tyndale Puckett, Jr. 1989 Trust; and Margaret Whittington Puckett, individually and as trustee of the Margaret Lynn Puckett 1989 Trust, the Sara Whittington May 1989 Trust, the Caroline Elizabeth Puckett 1989 Trust, the Michael Erskine May 1989 Trust, the Camille Meriwether May 1989 Trust, and the William Tyndale Puckett, Jr. 1989 Trust, Cross–Appellees
• Court: Texas Court of Appeals

456 S.W.3d 692

Harry M. Whittington; Mercedes B. Whittington; Mercedes Gregg f/k/a Mercedes Whittington, individually and as trustee of the Margaret Lynn Puckett 1989 Trust, the Sara Whittington May 1989 Trust, the Caroline Elizabeth Puckett 1989 Trust, the Michael Erskine May 1989 Trust, the Camille Meriwether May 1989 Trust, and the William Tyndale Puckett, Jr. 1989 Trust; Sally Whittington May, individually and as trustee of the Margaret Lynn Puckett 1989 Trust, the Sara Whittington May 1989 Trust, the Caroline Elizabeth Puckett 1989 Trust, the Michael Erskine May 1989 Trust, the Camille Meriwether May 1989 Trust, and the William Tyndale Puckett, Jr. 1989 Trust; and Margaret Whittington Puckett, individually and as trustee of the Margaret Lynn Puckett 1989 Trust, the Sara Whittington May 1989 Trust, the Caroline Elizabeth Puckett 1989 Trust, the Michael Erskine May 1989 Trust, the Camille Meriwether May 1989 Trust, and the William Tyndale Puckett, Jr. 1989 Trust, AppellantsCity of Austin, Cross–Appellant

v. City of Austin, AppelleeHarry M. Whittington; Mercedes B. Whittington; Mercedes Gregg f/k/a Mercedes Whittington, individually and as trustee of the Margaret Lynn Puckett 1989 Trust, the Sara Whittington May 1989 Trust, the Caroline Elizabeth Puckett 1989 Trust, the Michael Erskine May 1989 Trust, the Camille Meriwether May 1989 Trust, and the William Tyndale Puckett, Jr. 1989 Trust; Sally Whittington May, individually and as trustee of the Margaret Lynn Puckett 1989 Trust, the Sara Whittington May 1989 Trust, the Caroline Elizabeth Puckett 1989 Trust, the Michael Erskine May 1989 Trust, the Camille Meriwether May 1989 Trust, and the William Tyndale Puckett, Jr. 1989 Trust; and Margaret Whittington Puckett, individually and as trustee of the Margaret Lynn Puckett 1989 Trust, the Sara Whittington May 1989 Trust, the Caroline Elizabeth Puckett 1989 Trust, the Michael Erskine May 1989 Trust, the Camille Meriwether May 1989 Trust, and the William Tyndale Puckett, Jr. 1989 Trust¹ , Cross–Appellees

NO. 03–13–00410–CV

Court of Appeals of Texas, Austin.

Filed: January 29, 2015

William Christian, Robert J. Hearon, Jr., John J. McKetta, III, Graves, Dougherty, Hearon & Moody, PC, Austin, TX, for appellant.

Anne L. Morgan, Division Chief, Litigation, City of Austin, Renea Hicks, Law Office of Max Renea Hicks, Austin, TX, for appellee.

Before Justices Puryear, Goodwin, and Field

OPINION

David Puryear, Justice

The City elected to take property belonging to the Whittingtons. As part of the process, the City paid a deposit into the registry of the trial court, and the deposit was later placed in an investment account with the permission of the parties. After the supreme court determined that the condemnation of the property was proper, the district court awarded the investment income to the City. Further, the district court used the date of a prior trial court judgment in its calculations when determining the amount of prejudgment and postjudgment interest owed. On appeal, the Whittingtons urge that they were entitled to the investment income, and on cross-appeal, the City challenges the district court's decision to use the date of the prior judgment when determining the interest awards. We will reverse the portion of the district court's judgment awarding investment interest to the City and affirm the remainder of the judgment.

BACKGROUND

This case presents the denouement of a conflict that arose between the City and the Whittingtons, which has resulted in extensive litigation as well as multiple appeals in this Court and in the supreme court. See City of Austin v. Whittington, 384 S.W.3d 766 (Tex.2012) (“Whittington ”); City of Austin v. Whittington, 379 S.W.3d 278 (Tex.App.–Austin 2010) (“2010 Whittington ”), rev'd, 384 S.W.3d 766 (Tex.2012) ; City of Austin v. Whittington, 385 S.W.3d 28 (Tex.App.–Austin 2007, no pet.) (“2007 Whittington ”); Whittington v. City of Austin, 174 S.W.3d 889 (Tex.App.–Austin 2005, pet. denied) (“2005

Whittington

”). In conformity with an extensive construction project, including the expansion of the City's convention center and the building of a cooling plant, the City elected “to acquire Block 38.” Whittington, 384 S.W.3d at 774. At that time, Block 38 was owned by the Whittingtons. Id. at 773. “The City and the Whittingtons could not agree on a price for Block 38, so the City Council passed a resolution in August 2001 authorizing a condemnation suit to acquire Block 38.” Id. at 775.

In October 2001, “[t]he City filed a condemnation suit” in a county court at law. Id. Subsequently, the trial court “appointed three special commissioners, who awarded the Whittingtons $7,650,000.” Id. However, the City and the Whittingtons objected to the amount of the award. Id. In order to take possession of the property pending the resolution of the dispute, the City deposited the amount of the award “into the registry of the court in January 2002.” Id. ; see Tex. Prop. Code § 21.021(a) (authorizing condemnor to take possession of property if condemnor deposits with court amount awarded by special commissioners); Tex. Loc. Gov't Code § 117.052(c)(7) (explaining that county clerk “is responsible for funds deposited into the registry fund” for “an eminent domain proceeding”). Once the City took possession of the property, the construction project began. Shortly after the award was placed in the registry of the court, the Whittingtons filed a motion to place the money in a separate account “[i]n order that this award earn interest at the highest rate reasonably available,” and the City agreed with the request. See Tex. Loc. Gov't Code § 117.053(c) (authorizing clerk to transfer funds into separate account if ordered by court). Accordingly, the trial court granted the request. When they made the request, the Whittingtons explained that they were still contesting the City's right to condemn the property and, therefore, were not asking “to withdraw funds from the custody of the Clerk's Registry.”

At the end of the trial before the county court at law, the “jury awarded $7,750,000 in damages, and the trial court entered judgment on that award.” Whittington, 384 S.W.3d at 775–76. Because the damages awarded by the jury were $100,000 more than the deposit that the City originally made, the City deposited an additional $100,000 into the account plus an additional $13,260, which represented the amount of prejudgment interest on the extra deposit that had accrued since the first deposit. See 2005 Whittington, 174 S.W.3d at 907 (explaining that “prejudgment interest begins to accrue on the date of the constitutional taking, the date the condemnor pays the amount of the special commissioners' award into the court's registry and gains the right to possess the property”). The Whittingtons appealed the judgment of the trial court, and this Court determined “that the City failed to meet its ... burden regarding its authority to condemn the Whittingtons' property.” Id. at 894, 908. Accordingly, we reversed and remanded the case for further proceedings. Id. at 908.

After the case was remanded, it was transferred to the district court. Whittington, 384 S.W.3d at 776. At the end of the trial on remand, “the jury found that: (1) the taking was not necessary to advance or achieve a public use; (2) the taking was for economic development purposes; and (3) the decision to take the property was fraudulent, in bad faith, and arbitrary and capricious.” Id. at 776. Moreover, the jury determined that the fair market value of Block 38 was $10,500,000. After the jury reached its decision, the Whittingtons filed a motion for entry of judgment and proposed judgment in which the Whittingtons requested that the district court decide, in accordance with the jury's determinations, that the City did not have the right to condemn the property and to order that the City surrender possession of the property to the Whittingtons. Subsequently, the trial court determined “as a matter of law that: (1) the taking was necessary to advance or achieve a public use”; and (2) “the statute prohibiting takings for economic development ... did not apply retroactively to the proceeding (disregarding the jury's contrary answers).” Id. Although the district court reversed two of the jury's findings, it “entered judgment for the Whittingtons because it determined that legally and factually sufficient evidence supported the jury's findings that the taking was fraudulent, in bad faith, and arbitrary and capricious.” Id. Accordingly, the district court ordered the City to surrender possession of Block 38 and awarded the Whittingtons damages resulting from the temporary possession of Block 38. After the district court rendered its judgment (“2007 judgment”), the City did not place any additional funds into the account.

Subsequently, the City appealed the district court's judgment. See 2010 Whittington, 379 S.W.3d at 280. On appeal, this Court concluded that the jury's determination of bad faith “was supported by legally and factually sufficient evidence.” Id. at 282–83. The City appealed our decision, and the supreme court reversed our judgment and concluded that “the City's determination that Block 38 was necessary for public use was not fraudulent, in bad faith, or arbitrary and capricious.” Whittington, 384 S.W.3d at 792. In addition, the court decided that the City's taking did not violate the statutory prohibition against takings for economic development because the City's actions fell within a statutory exception. Id. In light of these determinations, the court remanded the case to the district court “for entry of judgment in accordance with [its] opinion.” Id.

During this remand, the Whittingtons and the City filed competing motions for entry of final judgment. In the City's motion, the City mentioned that it has “thus far deposited a total of $7,763,260.60” into the registry of the court, that the money was transferred to an investment account, and that the...