KMS Retail Rowlett, LP f/k/a KMS Retail Huntsville, LP, Petitioner
City of Rowlett, Texas, Respondent
October 31, 2018
Petition for Review from the Court of Appeals for the Fifth
District of Texas
Justice Brown delivered the opinion of the Court, in which
Chief Justice Hecht, Justice Green, Justice Guzman, Justice
Devine, and Justice Busby joined.
Jeffrey V. Brown Justice
City of Rowlett exercised its eminent-domain authority to
take KMS's private-road easement and convert it to a
public road connecting several commercial retail and
restaurant sites. Pointing to the taking's relationship
to an economic-incentives deal that would secure a Sprouts
Farmers Market grocery store for the city, KMS argues the
taking violates both the Texas Constitution's public-use
requirement as well as chapter 2206 of the Government Code,
which prohibits takings for economic-development purposes.
KMS further urges that the taking should be invalidated
because it was fraudulent, in bad faith, and arbitrary and
trial court below granted partial summary judgment in the
city's favor and denied KMS's motion for summary
judgment altogether. The court of appeals affirmed. We agree
with the court of appeals that (1) chapter 2206 does not
apply here; (2) the taking was necessary for a constitutional
public use; and (3) KMS failed to raise a fact issue
precluding summary judgment. Accordingly, we affirm.
Retail Rowlett, LP, is a commercial-real-estate developer. It
owns a triangle-shaped nine-acre tract in the City of Rowlett
that is part of a commercial subdivision called Luke's
Landing. The tract is bordered to the west-northwest by
Kenwood Drive; to the south by Lakeview Parkway; and to the
east-northeast by a twelve-acre tract owned by Briarwood
Armstrong, LLC, also a commercial-real-estate developer.
much of the KMS tract remains undeveloped, four commercial
sites were built along the southern boundary with primary
access from Lakeview Parkway. At the time of the condemnation
proceeding at issue, those sites were occupied by a Wells
Fargo bank, a Starbucks, a Chick-fil-A, and an Arby's. As
part of its limited development of the tract, KMS built a
private drive that allows access to these four sites from the
west-northwest via Kenwood Drive. Located at a stoplight on
Kenwood Drive, the private drive allowed traffic to access
the four commercial sites from the rear. The drive extended
the length of the four commercial sites, but no farther,
leaving a stretch of vacant land between the edge of the four
sites and the border with the Briarwood tract to the east.
entrance to KMS's private drive was positioned across a
Walmart parking-lot entrance on the other side of Kenwood
Drive. Accordingly, customers leaving Walmart's parking
lot could reach KMS's commercial sites from the rear by
proceeding straight through a stoplight at Kenwood Drive.
Without the private drive, the most efficient route to reach
those sites from Walmart would be to travel south-southwest
along Kenwood Drive, turn left onto Lakeview Parkway, and
then turn left into the businesses' front-facing
parking-lot entrances. A not-to-scale map of Luke's
Landing and its surrounding properties and roadways is
appended to this opinion.
record reflects that as early as 2012, the city undertook
efforts to recruit a high-quality grocery store. City
representatives approached Sprouts Farmers Market and
discovered mutual interest in a Rowlett location. Sprouts
began negotiating with Briarwood to execute a long-term lease
under which Sprouts could build a store on the Briarwood
tract. In 2014, Briarwood asked the city about the
possibility of an economic-incentives deal to facilitate
negotiations with Sprouts. The city and Briarwood fleshed out
a deal that largely centered on tax breaks but also required
Briarwood to build a "private circulation drive
providing for cross-access between adjacent properties."
The "private circulation drive" would connect
KMS's existing private drive to the commercial
development on Briarwood's property. With the private
drive extended to reach the Briarwood tract, Sprouts would
benefit from cross-access traffic from the west via Kenwood
Drive. In exchange, the city agreed to pay Briarwood $225,
000, roughly half the projected cost of extending the private
case is about the city's eventual decision to condemn the
land necessary to extend the private drive to connect the KMS
and Briarwood tracts. The economic-incentives deal is silent
on whether Briarwood had an existing legal right to extend
the private drive. KMS argues that Briarwood and the city
colluded to have the city condemn what Briarwood could not
acquire on its own after Briarwood learned it had no easement
allowing it to extend the private drive and failed to
negotiate purchase of the necessary land. Accordingly, KMS
insists the city impermissibly condemned its property solely
to benefit a private entity. KMS points to Briarwood's
lease with Sprouts, which provides for reduced lease payments
to Briarwood if the cross-access drive isn't built, as
Briarwood's motivation for enlisting the city to condemn
between the tracts is mentioned in the city's earliest
documentation in the record regarding the Sprouts deal. A
PowerPoint presentation dated July 2014 that was prepared for
elected officials acknowledges the "potential need for
condemnation" to provide cross-access. The anticipated
private-road extension appears in schematics and an internal
city memo regarding preliminary plat approval of the Sprouts
development. And it is mentioned in every version of the
draft economic-incentives deal that appears in the record
along with the city's payment to Briarwood in exchange
for building it.
earliest indication in the record that Briarwood would have
trouble extending the drive appears in a September 2014 email
in which Briarwood's title insurer communicated that it
found no legal avenue for Briarwood to build on KMS's
tract. That finding had an immediate impact on the still
unapproved economic-incentives deal between the city and
Briarwood. On October 1, a city staffer emailed the city
council, stating, "I wanted to make sure you know that
we have pulled the agenda item on the Sprouts deal from the
October 7th council meeting. . . . To be clear, the parties
are good to go with the proposed development agreement.
However, the issue has to do with the wording on the plat of
the [KMS tract] and the connection of the road that is
proposed to be built between the two properties."
evidence suggests Briarwood offered to purchase an easement
to extend the private drive and that Briarwood rejected a
counter-offer from KMS. In an email, a Briarwood
representative stated, "We have decided our best way
forward on this situation is to convince our tenant to do
this deal without the bridge and without direct access to
Kenwood [D]rive." But that same month, the city's
attorney emailed a city staffer directing him to use an
attached easement-deed form to "get as many voluntary
dedications as possible" and then "get someone to
prepare a full-blown legal for the part of the roadway that
sits on the [KMS] tract and for anyone who doesn't
voluntarily sign the deed. Then . . . get an appraisal and
get the acquisition process underway."
economic-incentives deal was back on the city-council agenda
in November, and the terms regarding the cross-access drive
in the executed version of the agreement were unchanged from
previously circulated drafts. On January 16, however,
Briarwood and the city executed a letter amendment to the
economic-incentives deal that modified the terms of the
city's payment to Briarwood for construction of the
cross-access drive. It provided that the $225, 000 payment
"may, however, be reduced in accordance with
right-of-way acquisition costs incurred by the City (to
include payments made to property owners, ROW acquisition
agents, and direct costs incurred to acquire rights-of-way)
to convert the existing private easement on the adjacent
properties in the Luke's Landing subdivision/addition to
a public street or roadway. Such reduction shall not exceed
$62, 750 without [Briarwood's] approval."
city filed its original petition in eminent domain in March
2015. As evidence of collusion between Briarwood and the
city, KMS points out that a boundary survey attached to the
petition was prepared by the same engineering firm Briarwood
hired to prepare its preliminary plat and development plan.
KMS further insists, and the city has not disputed, that
Briarwood paid for the survey included with the
KMS's objections, a panel of special commissioners
awarded KMS $31, 662 for the taking. After KMS moved to
dismiss the eminent-domain action, the city and KMS filed
competing motions for summary judgment regarding the
permissibility of the city's taking. KMS argued in its
motion that the taking violated Government Code chapter 2206
and was not for a constitutional public use. KMS further
argued that the city's public use and necessity findings
were fraudulent, in bad faith, and arbitrary and capricious.
The trial court denied KMS's motion. It also granted the
city's motion for summary judgment in part, issued a
final judgment confirming the commissioners' award, and
dismissed all of KMS's claims with prejudice.
court of appeals affirmed, holding the summary-judgment
evidence established that the city's condemnation was
necessary for a public use and that KMS failed to raise a
fact issue as to whether the taking was fraudulent, in bad
faith, or arbitrary and capricious. 559 S.W.3d 192 (Tex.
App.-Dallas 2017). It further held chapter 2206 of the
Government Code inapplicable to the taking because an
exception provides that the statute "does not affect the
authority of an entity authorized by law to take private
property through the use of eminent domain for . . .
transportation projects, including, but not limited to . . .
public roads or highways." Id. at 203 (citing
Tex. Gov't Code § 2206.001(c)(1)). We granted
KMS's petition for review.
review a trial court's summary judgment de novo.
Valence Operating Co. v. Dorsett, 164 S.W.3d 656,
661 (Tex. 2005). When reviewing a summary judgment, we take
as true all evidence favorable to the nonmovant, and we
indulge every reasonable inference and resolve any doubts in
the nonmovant's favor. Provident Life & Accident
Ins. Co. v. Knott, 128 S.W.3d 211, 215 (Tex. 2003). Both
KMS and the city moved for summary judgment on traditional
and no- evidence grounds. To prevail on a traditional
summary-judgment motion, a movant must show that no genuine
issue of material fact exists and that it is entitled to
judgment as a matter of law. Sw. Elec. Power Co. v.
Grant, 73 S.W.3d 211, 215 (Tex. 2002). To defeat a
no-evidence motion, the nonmovant must produce at least a
scintilla of evidence raising a genuine issue of material
fact as to the challenged elements. Ford Motor Co. v.
Ridgway, 135 S.W.3d 598, 600 (Tex. 2004). Less than a
scintilla of evidence exists when the evidence is so weak as
to do no more than create a mere surmise or suspicion of a
fact. King Ranch, Inc. v. Chapman, 118 S.W.3d 742,
751 (Tex. 2003).
both sides move for summary judgment and the trial court
grants one motion and denies the other, the reviewing court
should review both sides' summary-judgment evidence and
determine all questions presented. FM Props. Operating
Co. v. City of Austin, 22 S.W.3d 868, 872 (Tex. 2000).
But when parties move for summary judgment on both
traditional and no-evidence grounds, we first consider the
no-evidence motion. Lighting Oil Co. v. Anadarko E&P
Onshore, LLC, 520 S.W.3d 39, 45 (Tex. 2017).
must be "necessary" for a "public
the Texas Constitution, property may be condemned only for a
public use and only so long as the owner is justly
compensated. Tex. Const. art. I, § 17 ("No
person's property shall be taken, damaged, or destroyed
for or applied to public use without adequate compensation
being made . . . ."). The Local Government Code
additionally requires that a taking be necessary for
a public use: "When the governing body of a municipality
considers it necessary, the municipality may exercise the
right of eminent domain for a public use to acquire public or
private property . . . ." Tex. Loc. Gov't Code
§ 251.001(a). In short, these provisions require the
municipality to demonstrate: (1) it intends to put the
property to public use (the public-use requirement); and (2)
the condemnation is necessary to advance or achieve that
public use (the necessity requirement). City of Austin v.
Whittington, 384 S.W.3d 766, 772 (Tex. 2012). KMS
primarily argues that the city's taking was not for a
public use but also contends it was unnecessary to achieve a
limitations in Government Code chapter 2206
2005, the United States Supreme Court held in Kelo v.
City of New London that the public-use requirement
imposed by the Fifth Amendment to the United States
Constitution was not violated when a city condemned a private
home as part of an economic-redevelopment plan that would
turn the land over to a private business See generally 545
U.S. 469 (2005) In a special-called session later that year,
the Texas legislature enacted Government Code chapter 2206,
which placed new statutory limits on governmental
entities' eminent-domain authority Act of Aug 16, 2005,
79th Leg, 2d CS, ch 1, § 1, 2005 Tex Gen Laws 1, 1-2
Specifically, chapter 2206 prohibits a taking that (1)
"confers a private benefit on a particular private party
through the use of the property", (2) "is for a
public use that is merely a pretext to confer a private
benefit on a particular private party", (3) is for
"economic development purposes", or (4) "is
not for a public use" Tex Gov't Code §
2206001(b)(1)-(4) These limitations were considered a swift
legislative response to Kelo See W Seafood Co v United
States, 202 F App'x 670, 677 (5th Cir 2006) (noting that
chapter 2206 was passed in response to the Kelo decision);
see also Harris Cty Flood Control Dist v Kerr, 499 S.W.3d
793, 813 (Tex 2016) (Lehrmann, J, concurring) (noting that
chapter 2206 "has widely been viewed as a response to
taking is exempt from Government Code chapter 2206
argues that because the "new public use definitions in
Section 2206.001(b) are entitled to judicial deference,"
the legislature's enactment of chapter 2206
"altered" our public-use jurisprudence.
Specifically, KMS contends we should more narrowly construe
constitutional "public use" in light of the
legislature's statutory winnowing of permissible takings.
We therefore first consider the applicability of chapter 2206
to the facts before us.
a taking is for a constitutional public use is a question
ultimately decided by the courts, but we have previously
stated that a legislative declaration on public use is
entitled to our deference. See Whittington, 384
S.W.3d at 777; Hous. Auth. of City of Dall. v.
Higginbotham, 143 S.W.2d 79, 83 (Tex. 1940)
("[W]here the legislature has declared a certain thing
to be for a public use, such declaration of the legislature
must be given weight by the courts."). Of course,
chapter 2206 does not purport to declare a public use. At
most, it declares what is not a public use. But
assuming chapter 2206 should nonetheless receive the
deference our precedent contemplates, we must first decide
whether chapter 2206 applies at all to this taking.
The city argues, and the court of appeals held, it does not.
argues that the city's taking violates all four of the
prohibitions found in section 2206.001(b). The city's
only response is that chapter 2206 includes an exception that
applies to this taking: "This section does not affect
the authority of an entity authorized by law to take private
property through the use of eminent domain for . . .
transportation projects, including, but not limited to,
railroads, airports, or public roads or highways . .
. ." Tex. Gov't Code § 2206.001(c)(1) (emphasis
easement was indisputably taken to facilitate construction of
a public road. KMS, however, contends the taking was not for
a legitimate transportation project. The
cross-access drive is inextricably linked, KMS argues, to the
economic-incentives agreement between Briarwood and the city.
So, KMS continues, it falls squarely under the type of taking
the legislature sought to prohibit. See id. §
2206.001(b)(1)-(4). KMS particularly emphasizes subsection
(b)(2), which prohibits a taking "for a public use that
is merely a pretext to confer a private benefit on a
particular private party." KMS insists the city's
stated reasons for taking its property-that it was needed to
facilitate cross-access, alleviate traffic, and provide
first-responder access-were merely pretexts for the
city's actual motivation: to provide a private benefit to
Briarwood and Sprouts that would help close their deal and
bring a Sprouts store to the city.
court of appeals noted our pronouncement in City of
Austin v. Whittington that the prohibitions found in
section 2206.001(b) "would not invalidate a taking for a
purpose that falls within one of the statutory exceptions
listed in section 2206.001(c)." 559 S.W.3d at 203
(citing Whittington, 384 S.W.3d at 791). It then
rejected KMS's argument that the taking is not a
legitimate transportation project, reasoning that
there is no statutory language "on which to add an
exception to the application of subsection (c) if a
transportation project is illegitimate or a requirement of
legitimacy." Id. In that court's view, a
determination that the taking is for a "transportation
project"-specifically, a "public road"-renders
section 2206 inoperative, ulterior motives notwithstanding.
appeal to this Court, KMS argues that the court of appeals
failed to reconcile subsections (b) and (c) in a manner that
would give effect to both provisions. KMS also contends that
probing the legitimacy of a taking for a "transportation
project" does not impermissibly add to the statute's
text. KMS further insists legislative history supports its
position. Finally, KMS argues that this taking is not for a
"transportation project" as defined by the
Transportation Code, nor is it a "public road"
under the city's own ordinances and standards.
interpreting statutes, we look to the plain meaning of the
enacted text. "We must enforce the statute 'as
written' and 'refrain from rewriting text that
lawmakers chose.'" Jaster v. Comet II Constr.,
Inc., 438 S.W.3d 556, 562 (Tex. 2014) (quoting
Entergy Gulf States, Inc. v. Summers, 282 S.W.3d
433, 443 (Tex. 2009)). We do not "resort to extrinsic
aids, such as legislative history, to interpret a statute
that is clear and unambiguous." Sullivan v.
Abraham, 488 S.W.3d 294, 299 (Tex. 2016). Rather, we
limit our analysis to the words of the statute and apply the
plain meaning of those words "unless a different meaning
is apparent from the context or the plain meaning leads to
absurd or nonsensical results." Molinet v.
Kimbrell, 356 S.W.3d 407, 411 (Tex. 2011). In doing so,
we use definitions the legislature has prescribed and take
into account any technical or particular meaning the words
have acquired. City of Rockwall v. Hughes, 246
S.W.3d 621, 625 (Tex. 2008) (citing Tex. Gov't Code
§ 311.011(b)). While we must consider the specific
statutory language at issue, we must do so while looking to
the statute as a whole, rather than as "isolated
provisions." TGS-NOPEC Geophysical Co. v.
Combs, 340 S.W.3d 432, 439 (Tex. 2011).
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