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Kms Retail Rowlett, LP v. The City of Rowlett

Court of Appeals of Texas, Fifth District, Dallas

July 19, 2017

KMS RETAIL ROWLETT, LP F/K/A KMS RETAIL HUNTSVILLE, LP, Appellant
v.
THE CITY OF ROWLETT, TEXAS, Appellee

         On Appeal from the County Court at Law No. 4 Dallas County, Texas Trial Court Cause No. CC-15-01323-D

          Before Justices Evans, Stoddart, and Boatright

          MEMORANDUM OPINION

          DAVID EVANS JUSTICE

         KMS Retail Rowlett, LP, f/k/a KMS Retail Huntsville, LP appeals the trial court's adverse rulings on cross-motions for summary judgment resulting in a final judgment awarding KMS stipulated damages of $31, 662 for the City of Rowlett's taking in fee simple of its private drainage, access, and utility easement (private road easement) for use as a public roadway. In three issues, KMS generally asserts the summary judgment evidence conclusively establishes, or creates a fact issue as to whether, the City's taking was for a private use, specifically, to provide an economic benefit to a competing developer. KMS also challenges the trial court's evidentiary rulings on its objections to the City's summary judgment evidence and the denial of its request for attorney's fees. For the reasons set forth below, we affirm the trial court's judgment.

         Background

         Central to this appeal is the validity of the City's taking of KMS's private road easement to convert it to a public roadway. At the location of this dispute, a Wal-Mart Supercenter is located to the west of KMS's tract of land separated only by Kenwood Drive that generally runs north-south. East of KMS's tract is land owned by Briarwood Armstrong, LLC on which a Sprouts grocery store later was developed. The private road easement the City condemned generally runs east-west parallel to Lakeview Parkway. Lakeview Parkway is on the southern border of the Wal-Mart and Briarwood tracts. The private road easement connects at approximately the mid-point of Briarwood's tract to Kenwood Drive immediately across from an entrance to approximately the mid-point of Wal-Mart.

         KMS's undeveloped nine-acre tract is accessible from Kenwood Drive and is part of a commercial subdivision named Luke's Landing. The condemned private road easement is located on KMS's tract's southern boundary. KMS built a private road on the easement in 2006 in conjunction with KMS's sale of four commercial pad sites located on the southern edge of the private road easement. The southern boundary of those four commercial tracts is Lakeview Parkway. By the time of the condemnation proceeding, those four tracts had been developed into a Wells Fargo bank, Starbucks coffee shop, Chick-fil-A restaurant, and an Arby's restaurant. Along Lakeview Parkway, Wal-Mart is west and Briarwood's tract is east of those four retail businesses.

         KMS did not complete construction of the private road all the way to end of the easement on the eastern edge of its subdivision in accordance with the easement in the Luke's Landing's recorded plat. Instead, KMS constructed the private road only to the fourth pad site. To complete the private road to the end of the easement, KMS would have had to construct a bridge across a flood plain. At the time the private road was constructed, however, the tract to the east of KMS's tract was undeveloped so the City allowed the development of the four pad sites without requiring completion of the private road.

         Briarwood owns the twelve-acre tract abutting the east side of the KMS tract. In 2014, Briarwood entered into an Economic Development Incentive Agreement with the City in connection with Briarwood's development of a Sprouts grocery store and other retail lots on its twelve-acre tract. Among other things, the agreement provided for an infrastructure grant to Briarwood for the design, construction, improvement and installation of a private circulation drive and drainage culvert providing for cross-access between its tract and the KMS tract. After Briarwood learned that it did not have legal authority to enter Luke's Landing to construct the drive and drainage culvert, however, it approached KMS for permission. The parties were unable to reach an agreement. The City then sought to condemn the part of the private road easement on KMS's tract and convert it into a public roadway that would allow vehicles to travel from Kenwood Drive across KMS's tract to reach the Briarwood tract and vice versa.[1] The City's economic incentive agreement with Briarwood was amended to reduce Briarwood's grant amount for the off-site culvert crossing to reflect the condemnation costs incurred by the City to convert the private road easement into a public street. Notably, the City sought to condemn only the boundaries of KMS's existing private road easement, approximately a fifteen foot strip of land 691 feet in length, plus a thirty foot wide drainage swale crossing.[2]

         After the City filed its condemnation petition, special commissioners conducted a hearing and awarded KMS damages of $31, 662 for the taking. KMS filed an answer objecting to the award and moving to dismiss the eminent domain action, generally alleging the taking was not necessary for a public use and asserting the City's determinations of necessity and public use were fraudulent, in bad faith, or arbitrary and capricious.

         The parties filed competing motions for summary judgment regarding the propriety of the City's exercise of eminent domain. In its motion, the City requested the trial court deny KMS's illegal taking claims, confirm the special commissioners' damage award, and award the City reasonable attorney's fees. KMS moved for summary judgment seeking dismissal of the City's eminent domain petition asserting the taking was not necessary for a public use and violated chapter 2206 of the government code. It also asserted the City's determinations of public use and necessity were fraudulent, in bad faith, and arbitrary and capricious. The trial court granted in part the City's summary judgment motion and denied KMS's motion in its entirety, dismissing with prejudice KMS's claims related to the alleged illegality of the taking and alleged fraud, bad faith, and arbitrariness. These rulings were incorporated into a final judgment in the City's favor awarding KMS stipulated damages of $31, 662.00 which was deposited into the registry of the court.[3] This appeal followed.

         Analysis

         A. Standard of Review

         We review a trial court's summary judgment rulings de novo. See Travelers Ins. Co. v. Joachim, 315 S.W.3d 860, 862 (Tex. 2010). Both parties moved for summary judgment on traditional and no-evidence grounds. On their traditional summary judgments, each bears the burden of establishing that there are no issues of material fact and it is entitled to judgment as a matter of law. See City of Garland v. The Dallas Morning News, 22 S.W.3d 351, 356 (Tex. 2000). With respect to the no-evidence motions for summary judgment, the non-movant must produce more than a scintilla of evidence to raise a fact issue on each challenged element of a claim on which it had the burden of proof. See Gen. Mills Rests., Inc., v. Tex. Wings, Inc., 12 S.W.3d 827, 832-33 (Tex. App.-Dallas 2000, no pet.). When both parties move for summary judgment and the trial court grants one party's motion for summary judgment and denies the other party's motion, we can consider both motions, review the summary judgment evidence presented by both sides, determine all questions presented, and render the judgment the trial court should have rendered. See FM Props. Operating Co. v. City of Austin, 22 S.W.3d 868, 872 (Tex. 2000); Malcomson Road Util. Dist. v. Newsom, 171 S.W.3d 257, 263 (Tex. App.- Houston [1st Dist.] 2005, pet. denied) (op. on reh'g).

         B. Objections to the City's summary judgment evidence

         In its fifth issue, KMS contends that the trial court erred in overruling its objections to the affidavit of James Edward Grabenhorst, the City's Director of Economic Development.[4] KMS argues that the affidavit was the only evidence to support the City's contention that the taking was necessary for a public use, specifically, to alleviate traffic congestion and traffic hazards.

         A trial court's evidentiary rulings are matters left to its sound discretion and will not be disturbed on appeal unless an abuse of discretion is shown. See Cantu v. Horany, 195 S.W.3d 867, 871 (Tex. App.-Dallas 2006, no pet.). Moreover, we may not reverse for an erroneous evidentiary ruling unless the error probably caused the rendition of an improper judgment. See Tex. R. App. P. 44.1; Mancorp, Inc. v. Culpepper, 802 S.W.2d 226, 230 (Tex. 1990). Here, the summary judgment evidence included the following evidence to which there was no objection: (1) the City's formal resolution indicating the taking was for creation of a public street; (2) the City's staff report indicating (a) the public street would provide access from Kenwood Drive across the drainage channel to the Briarwood tract, (b) the drive approach would provide circulation between retail locations on the north side of Lakewood Parkway, facilitating retail activity and preventing an increase in traffic flow on Lakeview Parkway, and (c) the public street is necessary for emergency vehicle access and first responder service; and (3) statements in Grabenhorst's affidavit indicating the acquisition of the property in this case was needed for cross-access and traffic circulation between retail centers that were traffic generators. Because the statements in Grabenhorst's affidavit regarding traffic impact and emergency response vehicles that KMS objected to are substantiated by other unobjected to summary judgment evidence, any error with respect to the trial court's overruling of KMS's objections is harmless. We resolve this issue against KMS.[5]

         C.Public Use and ...


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