Opinion
No. 3:21-cv-74
2022-05-23
Thomas E. RHONE d/b/a Rhone Investments, Plaintiff, v. The CITY OF TEXAS CITY, TEXAS, Defendant.
Mark Wandless Stevens, Attorney at Law, Galveston, TX, for Plaintiff. Kyle Lesley Dickson, Philip James McCrady-Nolen, Murray Lobb PLLC, Houston, TX, for Defendant.
Mark Wandless Stevens, Attorney at Law, Galveston, TX, for Plaintiff.
Kyle Lesley Dickson, Philip James McCrady-Nolen, Murray Lobb PLLC, Houston, TX, for Defendant.
MEMORANDUM OPINION AND ORDER
Jeffrey Vincent Brown, United States District Judge:
Before the court is the defendant's motion for summary judgment on seven of the plaintiff's claims. Dkt. 14. Having considered the arguments, the evidence, and the applicable law, the court grants in part and denies in part.
I. Background
The plaintiff, Thomas E. Rhone d/b/a Rhone Investments, owns three apartment buildings adjacent to Carver Park in Texas City. Dkt. 1-3 at 3. In January of 2020, Texas City inspected the property and later issued a notice to Rhone drawing his attention to § 107.6 of the Texas City Property Maintenance Code. Id. at 16. Section 107.6 provides that it is "unlawful for the owner of any dwelling unit or structure who has received a compliance order or upon whom a notice of violation has been served to sell, transfer, mortgage, lease or otherwise dispose of such dwelling unit ... until the provisions of the compliance order" have been satisfied. Id.
Rhone alleges that in the months following the January 2020 inspection, "one or more City officials, acting under color of law but without valid authorization or court declaration, visited tenants of the property in question" informing them that the "property was unsafe; that they should vacate, and that they should not pay rent to Rhone." Id. at 3. He also alleges that Texas City has "interfered with efforts by Rhone to remedy the violations claimed by the city." Id. at 5. Rhone further charges the reasons Texas City gave for refusing to issue permits he sought were pretextual, such as permit applications having been emailed incorrectly or Rhone listing his business address on the applications rather than the property address. Id. Rhone likewise alleges Texas City ignored plans he submitted and interposed conditions—such as the requirement to obtain a certificate of occupancy—which make it "impossible" for him to preserve the value of his property by repairing rather than demolishing. Id.
Texas City filed an administrative action in its Municipal Court of Record, which was dismissed "after several hours of testimony," in November of 2020. Dkt. 1-3 at 4. The dismissal was followed by two separate actions. Texas City filed an action against Rhone in the 405th District Court of Galveston County seeking only an injunction to prohibit " ‘renting’ the building due to the alleged lack of a certificate of occupancy." Id. A temporary injunction was granted and is currently on interlocutory appeal. Id. Texas City also filed a second abatement action in its Municipal Court of Record in December 2020, with a hearing set for February 24, 2021. Id. Rhone alleges Texas City did not file its complaint in the second abatement action until February 22—just two days before the hearing. Id. He also complains that the Municipal Court overruled his motion for continuance "[i]n a departure from its posted procedures." Id. The Municipal Court conducted the hearing on February 24 and entered an order of abatement directing the demolition of the buildings on the property. Id. The Municipal Court also overruled Rhone's motion for new trial. Id.
The live pleading in this case incorrectly states the dates of Texas City's complaint and the trial as February 21 and 23; the dates, taken directly from the Municipal Court's orders, were in fact February 22 and 24, respectively. Dkt. 1-3 at 19, 28.
Rhone appealed the Municipal Court's order of abatement by verified petition in the 122nd Judicial District Court of Galveston County on March 24. Dkt. 1. Texas City timely removed that action to this court under federal-question jurisdiction. Id. Rhone has sued Texas City: (1) seeking a declaratory judgment that the Municipal Court of Record is unconstitutional; (2) for de novo review of the Municipal Court's order of abatement; (3) for a finding of inverse condemnation under state law; (4) for state due-course-of-law protection; (5) for deprivation of federal due process; (6) under § 1983 alleging a Fifth Amendment Taking; (7) under § 1983 alleging an unconstitutional seizure under the Fourth Amendment; (8) for injunctive relief; (9) to bar Texas City's claim for attorney's fees; and (10) for attorney's fees. Dkts. 1-3 at 5–10; 15 at 11 (adding the Fourth Amendment seizure claim).
Rhone has abandoned his application for a temporary restraining order/preliminary injunction by failing to pursue it beyond the state-court petition. See Black v. N. Panola Sch. Dist. , 461 F.3d 584, 588 n.1 (5th Cir. 2006) (finding failure to pursue a claim beyond the complaint constituted abandonment).
Texas City has moved for summary judgment on claims 1–6, as well as on the issue of monetary damages for due-process violations under the Texas Constitution. Dkt. 14.
II. Legal Standard
Summary judgment is proper when "there is no genuine dispute as to any material fact and the movant is entitled to a judgment as a matter of law." Fed. R. Civ. P. 56(a). The court must view the evidence in the light most favorable to the nonmovant. Coleman v. Houst. Indep. Sch. Dist. , 113 F.3d 528, 533 (5th Cir. 1997). The movant bears the burden of presenting the basis for the motion and the elements of the causes of action on which the nonmovant will be unable to establish a genuine dispute of material fact. Celotex Corp. v. Catrett , 477 U.S. 317, 323, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). The burden then shifts to the nonmovant to offer specific facts showing a genuine dispute for trial. See Fed. R. Civ. P. 56(c) ; Matsushita Elec. Indus. Co. v. Zenith Radio Corp. , 475 U.S. 574, 586–87, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986). "A dispute about a material fact is ‘genuine’ if the evidence is such that a reasonable jury could return a verdict for the nonmoving party." Bodenheimer v. PPG Indus., Inc. , 5 F.3d 955, 956 (5th Cir. 1993) (citation omitted).
The court "may not make credibility determinations or weigh the evidence" in ruling on a summary-judgment motion. Reeves v. Sanderson Plumbing Prods., Inc. , 530 U.S. 133, 150, 120 S.Ct. 2097, 147 L.Ed.2d 105 (2000). But when the nonmoving party has failed "to address or respond to a fact raised by the moving party and supported by evidence," then the fact is undisputed. Broad. Music, Inc. v. Bentley , No. SA-16-CV-394-XR, 2017 WL 782932, at *2 (W.D. Tex. Feb. 28, 2017). "Such undisputed facts may form the basis for summary judgment." Id. The court may grant summary judgment on any ground supported by the record, even if the ground is not raised by the movant. United States v. Houst. Pipeline Co. , 37 F.3d 224, 227 (5th Cir. 1994).
III. Analysis
a. De Novo Review
Rhone timely appealed the Municipal Court's order to the appropriate state district court. Tex. Loc. Gov. Code § 214.0012(a) (affording an appeal from a nuisance determination via verified petition in state district court). But review of a nuisance determination in the district court is limited by the substantial-evidence rule. Tex. Loc. Gov. Code § 214.0012(f). The reviewing court may reverse or affirm, in whole or in part, or may modify the decision. Id. It was from the district court that Texas City removed Rhone's appeal to this court on the basis of federal-question jurisdiction. Dkt. 1.
Rhone styles this appeal as, in part, a petition for writ of certiorari, and premises the support for de novo review on both his due-process claims and the unconstitutionality-of-municipal-courts-of-record argument. Dkt. 1-3 at 6. Rhone argues that de novo review is appropriate "because Texas [l]aw contemplates and requires that such court afford due process, i.e., a neutral and detached magistrate." Dkt. 15 at 24.
Tex. Loc. Gov. Code § 214.0012(b) ("On the filing of the petition, the court may issue a writ of certiorari directed to the municipality to review the order of the municipality and shall prescribe in the writ the time within which a return on the writ must be made, which must be longer than 10 days, and served on the relator or the relator's attorney").
Texas City agrees Rhone is entitled to appellate review as a property owner saddled with a nuisance determination, Tex. Loc. Gov. Code § 214.0012(a), but disagrees as to the appropriate standard. Dkt. 14 at 16 (citing City of Dallas v. Stewart , 361 S.W.3d 562, 571 (Tex. 2012) ).
As for Rhone's argument for an equitable adjustment to the standard of review, it is without legal support. Contrary to Rhone's mischaracterization of Stewart , de novo review was appropriate in that case because it was appealed from an unelected municipal agency. 361 S.W.3d at 580. The court's closing statement, in full, clearly states the proposition:
Because we believe that unelected municipal agencies cannot be effective bulwarks against constitutional violations, we hold that the [unelected municipal agency]’s nuisance determination, and the trial court's affirmance of that determination under a substantial evidence standard, were not entitled to preclusive effect in Stewart's takings case, and the trial court correctly considered the issue de novo.
Id. at 580–81.
Whatever misgivings Rhone harbors against municipal courts of record, this court will not entertain his contentions that they are unelected municipal agencies in disguise, entitling him to de novo review under Stewart . Rhone has not cited, and this court is unaware of, any legal authority that compels any change of the standard of review based on removal or for equitable reasons. Accordingly, for the purpose of appellate review of the Municipal Court's determination that Rhone's property was a nuisance, this court is obligated to employ the substantial-evidence rule. b. Constitutionality of Municipal Courts of Record
In addition to the other relief sought, Rhone seeks a declaration by this court that "the Municipal Court of Record of Texas City, Texas[,] is constitutionally barred from hearing this or any other case in which the City of Texas City is either a prosecuting entity or an interested party." Dkt. 1-3 5–6. Rhone argues the structure of the municipal courts of record violates due process because it deprives parties of hearing by a neutral and detached magistrate. Id. (citing Tumey v. Ohio , 273 U.S. 510, 47 S.Ct. 437, 71 L.Ed. 749 (1927) ). Rhone stresses that the relationship between Texas City and its judges is spoiled by the very nature in which judges are appointed by contract between the city and the judge's law firm instead of by election. Dkt. 15 at 12.
Following Rhone's logic, this makes Texas City the municipal judge's "client," and "[a] federal judge would be required to recuse if he owned so much as one share of a corporation which was a party in interest before him." Id. Rhone takes issue with the contract itself, in which the municipal judge agrees: "I will maintain communications with you during my tenure and responsibilities to the City of Texas City and all material decisions affecting the office of Municipal Court Judge will be submitted to you for approval." Id. The "you" in this instance appears to be Kyle Dickson, Texas City's city attorney, who is a signatory to the contract and also the lead attorney for Texas City in this case. Id. at 13. The court takes judicial notice that Dickson, a practicing attorney and partner in a Houston law firm, is also the city attorney for Hitchcock.
Texas City responds that Rhone's argument is without merit because (1) the appointment of judges does not, standing alone, impugn the neutrality of the judge; and (2) the Texas legislature has authorized the creation of municipal courts of record by statute. Dkt. 14 at 18; see Tex. Loc. Gov't Code § 30.00003(a). Further, this same statute provides that municipal judges will be appointed by ordinance for a term of either two or four years. Id. § 30.00006. The judges must also be licensed attorneys in good standing with a minimum of two years of experience in the practice of law. Id. § 30.00006(c). Moreover, Texas courts have repeatedly affirmed the constitutional validity of municipal courts of record. Martin v. State , 13 S.W.3d 133, 136 (Tex. App.—Dallas 2000, no pet.).
See also Leverson v. State , No. 03-15-90-CR, 2016 WL 4628054, at *6 (Tex. App.—Austin Aug. 30, 2016, no pet.) ("The Legislature exercised its constitutional authority when it enacted the statutory scheme creating municipal courts"); Ex parte Wilbarger , 41 Tex.Crim. 514, 55 S.W. 968, 971 (1900) (upholding constitutionality of corporation courts, precursor to municipal courts and municipal courts of record).
Moreover, the relationship between Texas City and its appointed municipal court judges is easily distinguishable from the cases Rhone has cited in support. Those cases make clear that the principal concern of the court was not a de minimis pecuniary interest of the judge, but a judge who has a "direct, personal, substantial pecuniary interest in reaching a conclusion against [the defendant] in his case." Tumey , 273 U.S. at 523, 47 S.Ct. 437.
Aetna Life Ins. Co. v. Lavoie , 475 U.S. 813, 827 n.3, 106 S.Ct. 1580, 89 L.Ed.2d 823 (1986) ("We therefore follow Ward v. Village of Monroeville and decline to read Tumey as constitutionalizing any rule that a decision rendered by a judge with ‘the slightest pecuniary interest’ constitutes a violation of the Due Process Clause.") (citation omitted).
In Tumey and Ward v. Village of Monroeville , 409 U.S. 57, 93 S.Ct. 80, 34 L.Ed.2d 267 (1972), the Supreme Court based its decisions in part on the "possible temptation" of an official who "occupies two practically and seriously inconsistent positions, one partisan and the other judicial." 273 U.S. at 534, 47 S.Ct. 437. "The mere union of the executive power and the judicial power in [one official] cannot be said to violate due process," id. , rather "the test is whether the [official's] situation is one ‘which would offer a possible temptation to the average man as a judge to forget the burden of proof required to convict the defendant, or which might lead him not to hold the balance nice, clear, and true between the state and the accused.’ " Ward , 409 U.S. at 60, 93 S.Ct. 80 (quoting Tumey , 273 U.S. at 532, 47 S.Ct. 437 ).
Rhone's reliance on Aetna Life Insurance Company v. Lavoie , 475 U.S. 813, 106 S.Ct. 1580, 89 L.Ed.2d 823 (1986), is no more convincing. In Aetna the Court held that due process was violated when an Alabama Supreme Court justice refused to recuse himself from a case in which he had a "direct, personal, substantial, [and] pecuniary" interest. 475 U.S. at 824, 106 S.Ct. 1580 (quoting Ward , 409 U.S. at 60, 93 S.Ct. 80 ). In the Court's language, "when Justice Embry made that judgment, he acted as ‘a judge in his own case,’ " id. , in violation of the mandate established by In re Murchison , 349 U.S. 133, 136, 75 S.Ct. 623, 99 L.Ed. 942 (1955). Aetna is a far cry from the facts of this case, where Texas City's municipal court judge was appointed by local ordinance, in keeping with state statute, to adjudicate his docket in accordance with the city's policies and procedures and his own legal training and experience.
None of these cases stand for the proposition that a state policy of local appointment of municipal court judges is inherently unconstitutional. Indeed, all sides agree that it is axiomatic that a "[a] fair trial in a fair tribunal is a basic requirement of due process." Id. at 136, 75 S.Ct. 623. The Supreme Court has recognized, however, that "most matters relating to judicial disqualification [do] not rise to a constitutional level." FTC v. Cement Inst. , 333 U.S. 683, 702, 68 S.Ct. 793, 92 L.Ed. 1010 (1948). As far back as Tumey , the Court recognized this, stating "matters of kinship, personal bias, state policy , remoteness of interest, would seem generally to be matters merely of legislative discretion." 273 U.S. at 523, 47 S.Ct. 437 (emphasis added).
Accordingly, Texas City is entitled to summary judgment on Rhone's request for declaratory judgment.
c. Monetary Damages under § 19 of the Texas Constitution
Texas City argues, and Rhone concedes, that monetary damages are unavailable under the due-course-of-law protections in the Texas Constitution. Dkts. 14 at 17; 15 at 25. The court agrees. City of Houston v. Downstream Env't, L.L.C. , 444 S.W.3d 24, 40 (Tex. App.—Houston [1st Dist.] 2014, pet. denied) ; Nueces Cnty. v. Ferguson , 97 S.W.3d 205, 217 (Tex. App.—Corpus Christi 2002, no pet.) (citing City of Beaumont v. Bouillion , 896 S.W.2d 143, 149 (Tex. 1995) (determining that no private right for damages was permitted for violations of state constitutional rights and vacating jury award of damages)). Texas City is entitled to summary judgment on Rhone's claim for monetary damages for due-course-of-law violations.
d. Due-Process/Due-Course-of-Law Protection Claims
Following a review of Rhone's due-process claims, the court is of the notion that Rhone may well prevail on them as a matter of law. But before finally ruling on those claims, the court requests supplemental briefing by both parties, under Rule 56(f), with particular emphasis on whether the city's failure to file its complaint until two days before the February 24 hearing and the Municipal Court's denial of Rhone's motion for continuance violated his due-process rights. Until then, Texas City's motion for summary judgment on the due-process and due-course-of-law protection claims is held in abeyance.
e. Inverse Condemnation
Because Rhone's inverse-condemnation claim under the Texas Constitution (Article I, §§ 17, 19 ) is intertwined with his federal due-process and state due-course-of-law claims, the court also stays decision on this claim.
* * *
The parties are ordered to submit supplemental briefs (limited to no more than 10 pages) responsive to Section III(d), above, no later than June 24, 2022.
For all of the above reasons, the court grants in part and denies in part Texas City's motion for summary judgment. Dkt. 14.
For clarity, the following claims and remedies are dismissed:
• Declaratory judgment that Municipal Court of Record of Texas City is unconstitutional
• De novo review of Municipal Court's order of abatement
• Monetary damages for due-process violations under the Texas Constitution
• Application for temporary restraining order/preliminary injunction
The following claims survive:
• Fourth Amendment Seizure (§ 1983)
• Barring of Texas City's claim for attorneys fees*
• Attorneys Fees*
Not addressed in Texas City's motion.
The following claims are stayed pending supplemental briefing:
• State inverse condemnation
• State due-course-of-law protection
• Federal due process
• Fifth Amendment Takings (§ 1983)