Summary
In O'Fiel, the plaintiff's owned a home on the property affected by the 2006 amendment, and they alleged they were unable to build an improvement on their property.
Summary of this case from City of Houston v. HS Tejas, Ltd.Opinion
No. 01-08-00242-CV
Opinion issued January 29, 2009.
On Appeal from County Civil Court of Law Number One Harris County, Texas, Trial Court Cause No. 901201.
Panel consists of Justices JENNINGS, HANKS, and BLAND.
MEMORANDUM OPINION
Appellant, the City of Houston ("the City"), appeals the trial court's denial of its plea to the jurisdiction. The City argues that the trial court should have granted its plea to the jurisdiction because the suit filed against it by appellees, John and Mary Jane O'Fiel ("the O'Fiels"), is not ripe for adjudication. We affirm.
Background
John and Mary Jane O'Fiel own property near White Oak Bayou, within the City of Houston. The property consists of 45,750 square feet of land and one 628-square-foot house. According to the O'Fiels, prior to 2006, the City's Code of City Ordinances ("the Code"), restricted development within the floodway of the City but allowed the city engineer to issue permits notwithstanding those restrictions. In 2006, the City amended the Code to further restrict development within the floodway.
The City has filed an authenticated copy of the Ordinance at issue in this Court, and we hereby take judicial notice of the contents of that Ordinance. TEX. R. EVID. 204.
Section 19-43(a)(2) prohibits the issuance of a permit for "development to be located in any floodway, . . . if that development provides for [n]ew construction, additions to existing structures, or substantial improvement of any structure within the floodway." Section 19-43(d) allows the city engineer to issue a permit, even if a permit application is denied under section 19-43(a)(2), so long as the general appeals board determines in writing that the improvement is insubstantial and will not increase flood levels during occurrence of the base flood nor impede the flow of floodwaters.
The O'Fiels filed suit against the City in 2007, alleging that, after the Federal Emergency Management Agency approved new Flood Insurance Rate Maps in June 2007, their property was within a newly delineated floodway. The O'Fiels allege that, in light of that new designation, the City's 2006 amendments to Section 19-43(c) of the Code prohibit the issuance of building permits for "new construction, additions to existing structures or substantial improvement of any structure" on their property. In addition, the O'Fiels contend that the amended Code prohibited the City Engineer from issuing any building permits for such construction, stating that the Code "simply denies [the O'Fiels] the ability to secure a building permit without a right to be heard by any administrative body or agency." The O'Fiels allege that the City's ordinance "unlawfully deprived [them] of use, benefit and enjoyment of the Property and has drastically reduced its value because [they] can neither construct any improvement in or upon the Property nor sell the Property to anyone who desires to construct any improvements in or upon the Property." Finally, the O'Fiels allege that "no administrative procedures have been established by [the City] for the issuance of building permits on properties situated in the Floodways within the geographical boundaries of the City of Houston."
The City's answer alleges that the O'Fiels had failed to exhaust the administrative remedies allowed by the Code. The City also provided an affidavit from the City Engineer attesting that the O'Fiels had not applied for a development permit for their property, that no such permit had been yet denied to them, and that no appeal had been taken from such a denial. The City filed a plea to the jurisdiction contending that the City Engineer has exclusive authority to approve or disapprove an application for a permit for proposed development in a floodway, and that the Code also allows for an appeal to the General Appeals Board if the City Engineer denied a development permit for an improvement that the Board determined was "insubstantial." The City argues that, because the O'Fiels had not filed an application for a permit, nor had they yet appealed such a denial as allowed by the Code, their claims were not ripe and the trial court lacked jurisdiction to consider their petition. The City again attached the affidavit of the City Engineer, stating that the O'Fiels had not sought, nor had they been denied or appealed, a development permit for their property.
The O'Fiels responded that, under the plain language of the Code, their intended use for the property — residential construction — was expressly forbidden and the Code allowed no discretion or variances. After hearing, the trial court denied the City's plea to the jurisdiction, and this interlocutory appeal followed.
Standard of Review
We review the trial court's ruling on a plea to the jurisdiction under a de novo standard. Tex. Dep't of Parks Wildlife v. Miranda, 133 S.W.3d 217, 228 (Tex. 2004). If the plea challenges the sufficiency of the claimant's pleadings, the trial court must construe the pleadings liberally in the claimant's favor and deny the plea if the claimant has alleged facts affirmatively demonstrating jurisdiction to hear the case. If the pleadings are insufficient, the court should afford an opportunity to replead if the defects are potentially curable but may dismiss if the pleadings affirmatively negate the existence of jurisdiction. Id. at 226-27.
If the plea to the jurisdiction challenges the existence of jurisdictional facts, the trial court must consider relevant evidence submitted by the parties. Id. at 227. If the evidence creates a fact question regarding jurisdiction, then the trial court cannot grant the plea to the jurisdiction, and the fact issue will be resolved by the fact-finder. But if the relevant evidence is undisputed or fails to raise a fact question on the jurisdictional issue, the trial court rules on the plea to the jurisdiction as a matter of law. Id. at 227-28. In reviewing the evidence presented in support of the plea to the jurisdiction, we take as true all evidence favorable to the nonmovant. Id. at 228. We indulge every reasonable inference and resolve any doubts in the nonmovant's favor. Id. "[T]his standard generally mirrors that of a summary judgment under Texas Rule of Civil Procedure 166a(c). . . . By requiring the [political subdivision] to meet the summary judgment standard of proof in cases like this one, we protect the plaintiffs from having to put on their case simply to establish jurisdiction." Id. (internal quotations and citation omitted); accord Dallas County v. Wadley, 168 S.W.3d 373, 377 (Tex.App.-Dallas 2005, pet. denied) ("[On a plea to the jurisdiction,] the burden is on the government to meet the summary judgment standard of proof.").
We remain mindful of the Texas Supreme Court's admonishment that, although the plaintiff's claims may form the context against which the jurisdictional plea is determined, the plea generally "should be decided without delving into the merits of the case." Bland Indep. Sch. Dist. v. Blue, 34 S.W.3d 547, 554 (Tex. 2000). In general, "the proper function of a dilatory plea does not authorize an inquiry so far into the substance of the claims presented that plaintiffs are required to put on their case simply to establish jurisdiction." Id. at 554.
Analysis
The Texas Constitution provides that no "person's property shall be taken, damaged or destroyed for or applied to public use without adequate compensation being made." TEX. CONST. art. I, § 17; Sheffield Dev. Co., Inc. v. City of Glenn Heights, 140 S.W.3d 660, 669 (Tex. 2004). Similarly, the Just Compensation Clause of the Fifth Amendment provides that "private property [shall not] be taken for public use without just compensation." U.S. CONST. amend. V. The Just Compensation Clause applies to the states by operation of the Fourteenth Amendment. Mayhew v. Town of Sunnyvale, 964 S.W.2d 922, 933 (Tex. 1998).
Inverse condemnation occurs when property is taken for public use without proper condemnation proceedings and the property owner attempts to recover compensation for that taking. City of Dallas v. Blanton, 200 S.W.3d 266, 271 (Tex.App.-Dallas 2006, no pet.). To state a cause of action for inverse condemnation, a plaintiff must allege: (1) an intentional governmental act; (2) that resulted in his property being taken, damaged, or destroyed; (3) for public use. Id. Although the Texas Constitution's adequate compensation provision is worded differently than the just compensation clause of the Fifth Amendment to the United States Constitution, the Texas Supreme Court has described them as comparable and generally looks to federal cases for guidance in takings cases. See Hallco Tex., Inc. v. McMullen County, 221 S.W.3d 50, 56 (Tex. 2006); Sheffield, 140 S.W.3d at 669.
Is the O'Fiels' claim ripe?
A regulatory-takings claim may challenge a land-use restriction on its face or as applied to particular property. Keystone Bituminous Coal Ass'n v. DeBenedictis, 480 U.S. 470, 494, 107 S. Ct. 1232, 1247 (1987) (recognizing "an important distinction between a claim that the mere enactment of a statute constitutes a taking and a claim that the particular impact of government action on a specific piece of property requires the payment of just compensation"); City of Corpus Christi v. Pub. Util. Comm'n, 51 S.W.3d 231, 247 (Tex. 2001). A facial challenge is ripe when the restriction is imposed, but an as-applied claim is not ripe until the regulatory authority has made a final decision regarding the application of the regulation to the property. Compare Yee v. City of Escondido, 503 U.S. 519, 533-534, 112 S. Ct. 1522, 1531-32 (1992) with Williamson County Reg'l Planning Comm'n v. Hamilton Bank, 473 U.S. 172, 186, 105 S. Ct. 3108, 3116 (1985). Because the O'Fiels do not allege that the sections of the Code at issue do not "substantially advance a legitimate state interest" no matter how they are applied, we construe the O'Fiels' claim as complaining that the Code, as applied to their property, amount to an unconstitutional regulatory taking of their property. Yee, 503 at 533-534, 112 S. Ct. at 1531-32.
Ripeness is an element of subject matter jurisdiction and, as such, is subject to de novo review. Mayhew v. Town of Sunnyvale, 964 S.W.2d 922, 928-29 (Tex. 1998). We look to the experience of the federal courts in determining the ripeness of constitutional challenges to land-use regulations. Id.
"[W]hile property may be regulated to a certain extent, if regulation goes too far it will be recognized as a taking." Pa. Coal Co. v. Mahon, 260 U.S. 393, 415, 43 S. Ct. 158, 160 (1922). In an as-applied takings claim, "[a] court cannot determine whether a regulation has gone `too far' unless it knows how far the regulation goes." Mayhew, at 929. To that end, a "final decision" in this context usually requires both a rejected development plan and the denial of a variance from the controlling regulation. Id.; see also Williamson County Reg'l Planning Comm'n, 473 U.S. at 186-88, 105 S. Ct. 3108, 3116 (holding takings claim not ripe where the property owner never sought variances from the zoning ordinance).
The term "variance" is "not definitive or talismanic"; it encompasses "other types of permits or actions [that] are available and could provide similar relief." Mayhew, 964 S.W.2d at 930. The variance requirement is therefore applied flexibly in order to serve its purpose of giving the governmental unit an opportunity to "grant different forms of relief or make policy decisions which might abate the alleged taking." Id. However, futile variance requests or re-applications are not required. Id. at 929. For instance, property owners are not required to seek permits for developments that the "property owner does not deem economically viable." Id. at 932; see also Palazzolo v. Rhode Island, 533 U.S. 606, 622, 121 S. Ct. 2448, 2460 (2001) ("Ripeness doctrine does not require a landowner to submit applications for their own sake."). "While a landowner must give a land-use authority an opportunity to exercise its discretion, once it becomes clear that the agency lacks the discretion to permit any development, or the permissible uses of the property are known to a reasonable degree of certainty, a takings claim is likely to have ripened." Palazzolo, 533 U.S. at 620, 121 S. Ct. at 2459. Where an ordinance "prohibit[s] precisely the use" the property owner "intended to make of th[e] property, and nothing in the ordinance suggest[s] any exceptions would be made," the owner's "taking claim [i]s ripe upon enactment" of the ordinance "because at that moment the `permissible uses of the property [are] known to a reasonable degree of certainty.'" Hallco Tex., Inc., 221 S.W.3d at 60(quoting Palazzolo, 533 U.S. at 620, 121 S. Ct. at 2459). We review the ripeness evidence before the trial court in the light most favorable to the O'Fiels. Miranda, 133 S.W.3d at 227-28.
The City argues that, because the O'Fiels have not applied for a permit to develop their property, their claim for inverse condemnation cannot be ripe and the trial court should have granted the City's plea to the jurisdiction. The City relies upon the Texas Supreme Court's decision in Mayhew to argue that there must be a "final decision" before the O'Fiels' claim can be ripe. Without such an application, and a denial of that application, the City argues it cannot be known for certain whether the O'Fiels' property has been taken or impaired in any way. The City essentially argues that, despite the seemingly mandatory language of the ordinance, the City or some agent thereof might grant the O'Fiels a variance or development permit for their property to allow construction.
The City's reliance on Mayhew misplaced. In Mayhew, the Mayhews sought permission for a development with a density exceeding the one-unit-per acre zoning requirement, and they told the town officials that a planned development would not be feasible under the one-unit-per-acre zoning. Id. at 925-26. After the Mayhews engaged in a series of discussions with officials lasting over a year, and submitted several studies and evaluative reports, the planned development request was denied. Id. The Mayhews subsequently filed suit alleging, among other things, that the town's refusal to approve the planned development was a taking of their property. Id. The town argued that the Mayhews' claims were not ripe because they submitted only one planned development application and did not thereafter reapply for development or submit a variance. Id. at 931. The Supreme Court found that, under the unique facts of the case, the Mayhews' efforts to gain permission for the development were sufficient to make their claim ripe, and any further applications would have been futile. Id. Unlike Mayhew, this case does not present the issue of whether the O'Fiels' efforts thus far to gain a variance or permit are sufficient, but whether the Code's plain language removes the need for any such efforts.
The O'Fiels point out that the plain language of section 19-43(a)(2) forbids exactly the type of development they wish to pursue on their property — "[n]ew construction, additions to existing structures, or substantial improvement of any structure within the floodway," and permits the city engineer to issue permits only for those permits which are initially denied but are later determined to be "insubstantial."
In addition, the O'Fiels point to section 19-20 of the Code which, while generally allowing applications for variances from the Code's requirements on the grounds of a "substantial hardship," specifically forbids variances for development within any floodway "if the development cannot meet the requirements of section 19-43(b) of this Code." Thus, the O'Fiels contend, applying for a permit or a variance would have been an exercise in futility and a waste of resources.
In light of the plain language of the ordinance, and specifically section 19-20's specific language prohibiting variances for the type of development sought by the O'Fiels, we believe the outcome in this case is controlled by the United States Supreme Court's decision in Suitum v. Tahoe Regional Planning Agency, 520 U.S. 725, 117 S. Ct. 1659 (1997) and the Supreme Court of Texas' opinion in Hallco Tex., Inc., 221 S.W.3d 50 (Tex. 2006).
In Suitum, a landowner filed suit claiming an unconstitutional regulatory taking of her land after the regional planning agency adopted a plan restricting development on parcels of land carrying runoff into area watersheds, a designation which included her land. The agency rules at issue did not permit any "additional land coverage or other permanent land disturbances" on such land. 520 U.S. at 730, 117 S. Ct. at 1663. Further, the rules did not provide for variances or exceptions, although they did provide for certain credits that landowners of land ineligible for construction could sell to owners of eligible parcels. Id. The agency argued that Suitum's claim could not be ripe, in part because she had not yet applied for a permit to develop her land. The Supreme Court disagreed, finding that, in light of the agency's complete lack of discretion under its rules to actually allow Suitum to build on her land, "no occasion exists for applying [the] requirement that a landowner take steps to obtain a final decision about the use that will be permitted on a particular parcel." Id. at 739, 117 S. Ct. at 1667.
In Hallco, the plaintiff purchased land in McMullen County near the Choke County Reservoir, which supplies water to Corpus Christi and surrounding areas. Hallco intended to operate an industrial waste landfill on the site. 221 S.W.3d at 60. After Hallco purchased the land, the McMullen County Commissioners Court passed an ordinance prohibiting the disposal of solid waste within three miles of the Reservoir, an area that included Hallco's property. Id. at 52-53. The ordinance did not establish any procedures for obtaining a variance. Id. at 53. Hallco filed suit against the County alleging that the ordinance amounted to an unconstitutional regulatory taking of its property. Id. In addressing when Hallco's takings claim had ripened, the Court noted that, "unlike Williamson County, this is not a case in which a general zoning or land-use restriction was subject to discretionary application." Id. at 60. Instead, "the ordinance here prohibited precisely the use that Hallco intended to make of this property, and nothing in the ordinance suggested any exceptions would be made." Id. Accordingly, the Court concluded that "Hallco's claim was ripe upon enactment because at that moment the permissible uses of the property were known to a reasonable degree of certainty." Id. (citing Palazzolo, 533 U.S. at 620, 121 S. Ct. at 2459).
Like the plaintiff in Suitum, the O'Fiels allege that the Code does not provide the City or any other agency discretion in allowing the O'Fiels to develop or build upon their property as they desire. Similarly, as in Hallco, the Code prohibits precisely the use the O'Fiels claim that they intend to make of their property, and nothing in the ordinance suggests any exceptions or variances would be granted to them for this use. The City did not present any evidence to raise a question of fact as to these assertions. Accordingly, we overrule the City's issue and find that, based upon the pleadings and the evidence that the record reflects were before the trial court at the time of the hearing, the issue of whether the Code constitutes an unconstitutional regulatory taking of the O'Fiels' property was ripe for adjudication.
Conclusion
We affirm the trial court's denial of the City's plea to the jurisdiction.