Trail Enterprises, Inc. D/B/A Wilson Oil Company, Thomas G. Rogers, Catherine Baumann, Carolyn Whipple, Mrs. S. Kelley Bruce, John Hobbs Kelley, Mary Virginia Kelley Ingram, Daystar Oil & Gas Corporation, John Alexander, Rebecca Bruce Jones v. the City of Houston

Opinion

IN THE

TENTH COURT OF APPEALS

 

No. 10-05-00382-CV

Trail Enterprises, Inc. d/b/a

Wilson Oil Company, THOMAS G.

ROGERS, CATHERINE BAUMANN,

CAROLYN WHIPPLE, MRS. S. KELLEY

BRUCE, JOHN HOBBS KELLEY, MARY

VIRGINIA KELLY INGRAM, DAYSTAR

OIL AND GAS CORPORATION, JOHN

ALEXANDER, REBECCA BRUCE JONES,

ELEANOR BRUCE McREYNOLDS, ROBERT

D. BRUCE, AND INTERVENOR, MARY BRUCE

                                                                                    Appellants

 v.

The City of Houston,

                                                                                    Appellee

From the County Civil Court at Law No. 1

Harris County, Texas

Trial Court No. 799234

O p i n i o n

        This appeal concerns Trail Enterprises’ inverse-condemnation claim against the City of Houston for an ordinance prohibiting oil drilling on Trail’s property near Lake Houston.  “An inverse condemnation occurs when property is taken for public use without process or without proper condemnation proceedings, and the property owner attempts to recover compensation therefor.”  Tarrant Reg’l Water Dist. v. Gragg, 43 S.W.3d 609, 614 (Tex. App.—Waco 2001), aff’d, 151 S.W.3d 546 (Tex. 2004); see U.S. Const. amend. V; Tex. Const. art. I, § 17.  The trial court initially found the City liable on Trail’s takings claim, and a jury determined the amount of Trail’s damages.  Thereafter, the trial court determined that Trail’s claims were not ripe and dismissed the claims for want of jurisdiction.  Trail appeals.  We reverse and render.

        Motions for Summary Judgment.  Most of Trail’s issues concern the trial court’s jurisdiction.  In Trail’s fourth and fifth issues, it contends that the trial court erred in granting the City’s motions for summary judgment, which were premised upon the lack of jurisdiction.  In Trail’s seventh issue, Trail contends that the trial court erred in overruling Trail’s motion for summary judgment on jurisdiction.  In Trail’s first three issues, it contends that the trial court erred in rendering judgment dismissing Trail’s cause for lack of jurisdiction.

        The parties’ motions for summary judgment concern whether Trail’s claims were ripe, specifically whether Trail exhausted its remedies within the City.  “Ripeness is an element of subject matter jurisdiction.”  Mayhew v. City of Sunnyvale, 964 S.W.2d 922, 928 (Tex. 1998); accord McAllen Med. Ctr., Inc. v. Cortez, 66 S.W.3d 227, 231 (Tex. 2001); Waco Indep. Sch. Dist. v. Gibson, 22 S.W.3d 849, 850, 851 (Tex. 2000).  “A case is not ripe when determining whether the plaintiff has a concrete injury depends on contingent or hypothetical facts, or upon events that have not yet come to pass.”  Gibson at 852.  However, “futile variance requests or re-applications are not required” in order for a regulatory takings claim to be ripe.  Mayhew at 929.  Moreover, 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. v. McMullen County, 221 S.W.3d 50, 60 (Tex. 2006) (quoting Palazzolo v. Rhode Island, 533 U.S. 606, 620 (2001)).

        The City’s motion raised two grounds: that Trail’s claim was not ripe, see Tex. R. Civ. P. 166a(c), and that there was no evidence that Trail’s claim was ripe, see Tex. R. Civ. P. 166a(i).  In Trail’s motion for summary judgment, it contended that its claim was ripe upon enactment of the ordinance.

        In a traditional summary-judgment motion, “[t]he judgment sought shall be rendered forthwith if” the summary-judgment evidence “show[s] that . . . there is no genuine issue as to any material fact and the moving party is entitled to judgment as a matter of law . . . .”  Tex. R. Civ. P. 166a(c).  In a no-evidence summary-judgment motion, “[t]he court must grant the motion unless the respondent produces summary judgment evidence raising a genuine issue of material fact.”  Id. 166a(i).  “The reviewing court must affirm summary judgment if any of the summary judgment grounds are meritorious.”  Tex. Workers’ Comp. Comm’n v. Patient Advocates, 136 S.W.3d 643, 648 (Tex. 2004); accord Star-Telegram, Inc. v. Doe, 915 S.W.2d 471, 473 (Tex. 1995).  “When both parties move for summary judgment and the trial court grants one motion and denies the other, the reviewing court should review the summary judgment evidence presented by both sides and determine all questions presented and render the judgment the trial court should have rendered.”  Patient Advocates at 648; accord FM Props. Operating Co. v. City of Austin, 22 S.W.3d 868, 872 (Tex. 2000).

        In the City’s traditional motion, the City moved for summary judgment on the ground that Trail’s “takings claim lack[ed] the necessary predicate of the denial of a drilling permit and the exhaustion of administrative remedies.”  (III C.R. at 939.)  In the City’s no-evidence motion, the City moved for summary judgment on the ground that there was “no evidence that [Trail] applied for and w[as] denied a drilling permit or otherwise exhausted [its] administrative remedies prior to initiating th[e] lawsuit.”  (Id. at 940.)  In Trail’s response to the City’s no-evidence motion, Trail argued that it “d[id] not need to produce evidence of a permit application,” and it did not.^[1]  (Id. at 1069; see Trail Br. at 12.)  Trail “concede[d] that no formal application was filed on [its] behalf with [the City] to obtain a permit to drill wells on [Trail’s] mineral properties.”  (III C.R. at 1058.)  Rather, Trail argues that such an application would have been futile: Trail’s “claims were ripe, as a matter of law, upon the City’s passage of” the ordinance and Trail “is not required to produce evidence on this element.”  (Br. at 18.)  In Trail’s motion, Trail argued that the ordinance does not provide for a variance from its prohibition.

Trail’s claims were ripe upon enactment of the ordinance.  The trial court erred in holding that Trail’s claims were not ripe and that the court thus lacked jurisdiction.  We sustain Trail’s first, second, third, fourth, fifth, and seventh issues.[2]  The trial court’s judgment dated August 29, 2005, will be reversed.

Motion for Judgment.  Trail’s sixth issue contends that the trial court erred in overruling Trail’s motions for judgment.  Trail argues that judgment should now be rendered for Trail on the finding of liability and the jury’s determination of damages.  We have concluded that the court erred in holding that Trail’s claims were not ripe.  Thus, we also sustain the sixth issue.  The judgment appealed from, signed on August 29, 2005, recites the history of the litigation and, prior to addressing the ripeness issue, states:

            The Court, based upon its findings and determination that an inverse condemnation occurred in this case on November 5, 1997, and based upon the stipulations of the parties and the jury verdict on the difference in market value of the property, was of the opinion that Plaintiffs were entitled to recover from Defendant $16,849,099.37 plus pre-judgment interest at the rate of 5.0% per annum from November 5, 1997, until date of judgment.  The final judgment is incorporated for all purposes by reference.

            After entry of judgment based upon the Jury Trial Verdict, the City filed a Motion for New Trial and urged that the cause was not ripe and should be denied for want of jurisdiction.

The Court then sustained the City’s motion on the ripeness issue and dismissed the case, without prejudice, for lack of jurisdiction.

The parties agree that neither a “final judgment” nor a “motion for new trial” described by the August 29, 2005, judgment quoted above was filed.  Accordingly, we requested that the parties submit their proposed judgments for our consideration.  We will render judgment for Trail.

            Conclusion.  We have sustained all of Trail’s issues.  We will reverse the trial court’s judgment and, based on the trial court’s finding that an inverse condemnation occurred,[3] the stipulations of the parties, and the jury’s verdict, render judgment[4] that:

1. Plaintiffs have and recover of and from the City of Houston the sum of SIXTEEN MILLION EIGHT HUNDRED FORTY-NINE THOUSAND NINTY-NINE AND 37/100 DOLLARS ($16,849,099.37), together with pre-judgment interest thereon at the rate of 5% per annum from November 5, 1997, to date of this judgment, and post-judgment interest at the maximum rate provided by law from the date of this judgment until paid;
2. The City of Houston have and recover of and from Plaintiffs as of November 5, 1997, all of Plaintiffs’ right, title, and interest in and to all of the oil, gas, and other minerals in and under 1,025 acres of land in Harris County, Texas, and being described as three tracts of 885 acres, 100 acres, and 40 acres, respectively, in Exhibit “A” attached to the judgment, which descriptions are incorporated herein for all purposes, the interests of the respective Plaintiffs being shown in Exhibits “B” and “C” attached to the judgment and being 88.46204 per cent of the mineral interests underlying the above described land according to the parties’ Stipulation appearing at Volume IV, Page 1166 of the Clerk’s Record in this cause;
3. The City of Houston is entitled to credit against the judgment granted herein for sums received by the Plaintiffs since the date of taking, November 5, 1997, on their respective interests set forth in Stipulations of the parties appearing at Volume IV, Page 1192 of the Clerk’s Record in this cause; and
4. The City of Houston pay all costs of this proceeding, including costs incurred in the trial court and in this court.

BILL VANCE

Justice

Before Chief Justice Gray,

        Justice Vance, and

        Justice Reyna

        (Chief Justice Gray dissenting)

Reversed and judgment rendered

Opinion delivered and filed November 21, 2007

[CVPM]         

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[1] Trail suggests on appeal that the ripeness doctrine should not apply to mineral interests.  The ripeness doctrine applies to mineral interests.  See City of Anson v. Harper, No. 11-05-00398-CV, 2006 Tex. App. LEXIS 6055, at *7-*10 (Tex. App.—Eastland July 13, 2006, no pet.).

[2] The opinion to this point was written by Chief Justice Gray.  When a majority voted to render judgment, the undersigned became the author.

[3] The trial court instructed the jury that a “taking” had occurred on November 5, 1997.

[4] If any party believes that the judgment we render should be modified or corrected, we invite a motion for rehearing to that effect.