Opposition Brief — Madero Development & Construction Co. v. City of El Paso

ep, Supreme Court, U.S

91-901 FILLED

ig DEC 31 1990

No. 91-101

OFFICE OF tHE CLERK

In The

Supreme Court of the United States

October Term, 1991

r

MADERO DEVELOPMENT AND CONSTRUCTION

COMPANY, INC., a Texas Corporation,

and CHAPARRAL EQUITY CORPORATION,

a Texas Corporation,

Petitioners,

V.

CITY OF EL PASO, TEXAS,

a Municipal Corporation, and

CITY PLAN COMMISSION,

Respondents.

¢

Petition For Writ Of Certiorari To The

Court Of Appeals Of Texas,

Eighth District, El Paso, Texas

¢

RESPONDENTS’ BRIEF IN OPPOSITION

+

Ropert H. FReEILIcH

RICHARD G. CARLISLE

Terry D. MorGAN

FREILICH, LEITNER, CARLISLE

_& SHORTLIDGE

1000 Plaza West

4600 Madison

Kansas City, Missouri 64112

(816) 561-4414

Counsel for Respondents

COCKLE LAW BRIEF PRINTING CO., (800) 225-6964

OR CALL COLLECT (402) 342-2831

=

QUESTIONS PRESENTED

In Madero Development and Constr. Co. v. City of El

Paso, No. EP-86-CA-403, slip op. (W.D. Tex. Dec. 21, 1988),

the United States District Court for the Western District

of Texas granted the City of El Paso’s motion for sum-

mary judgment dismissing Petitioners’ claims as unripe

under Williamson County Regional Planning Comm'n v.

Hamilton Bank of Johnson City, 473 U.S. 172 (1985) (requir-

ing, first, a final decision from the city applying its ordi-

nance to petitioners’ land and, second, a denial of jusi

compensation to petitioners by the state court). Peti-

tioners ignored the holdings of the District Court and

refused to seek a “variance from the Zoning Board of

Adjustment, the City Plan Commission, or the City Coun-

cil.” Slip op. at p.7.

Petitioners failed to appeal the District Court’s ruling

that they should seek a variance determination under

Texas law and, instead, filed the instant damages action

in state court. The Texas appellate court held that a

variance was available to Petitioners under Texas law and

that, accordingly, under state law the court was without

jurisdiction until Petitioners sought a final decision from

the City of El Paso.

The Texas court’s decision that Madero was required

to seek a final decision from the City of El Paso raises no

novel issues of federal law; nor does the decision of the

Texas courts in any way conflict with any other state or

federal decision. There is not even a hint that the State of

Texas — nor, for that matter, the City of El Paso — has acted

sO as to raise an important question of federal law.

ii

LIST OF PARTIES

Respondent City of El Paso, Texas, is a municipal

corporation organized under the laws of the State of

Texas. Respondent City Plan Commission is a public body

formed under the laws of the State of Texas and the El

Paso City Code.

ili

TABLE OF CONTENTS

Page

OO 8 Bg i

| ene sc ccsesvevcscecscccresus: ii

(ig SO > ere iii

ee ee 1

Nt hk boi us sm a Visio oa dos sseee ses 1

CONSTITUTIONAL PROVISIONS, STATUTES AND

6 8 2 1

a BE ad rn 2

A. Respondents’ Statement of Facts............. 2

B. Misstatements of Fact in Petitioners’ Statement

O60 —— eR ese An A ,

ee oun Dic eo es ¥ os 8

Surmamemey Gir ARGUMENT.............-.ececcee: Yy

a e.g hg Ace vw viet ewes’ 10

I. PETITIONERS WAIVED ANY CHALLENGE

TO THE FACIAL VALIDITY OF THE REGU-

cect utvcen vane 10

II. BECAUSE A STATE CONSTITUTIONAL REM-

EDY IS AVAILABLE, PETITIONERS’ FED-

ERAL TAKING CLAIM HAS NOT MATURED.

EES gee OL Eh oon ec ena 12

II. A DEVELOPMENT APPLICATION AND

FINAL DECISION ARE REQUIRED. ........ 15

i

iv

TABLE OF CONTENTS —- Continued

Page

IV. EVEN IF THE COURT OF APPEALS

REACHED THE FEDERAL RIPENESS QUES-

TION, IT CORRECTLY RULED THAT RIPE-

NESS IN THE CONTEXT OF AN AS

APPLIED REGULATORY TAKING CLAIM IS

JURISDICTIONAL UNDER FEDERAL LAW.

NO TAKING CLAIM ACCRUES UNTIL RIPE-

NESS REQUIREMENTS ARE SATISFIED..... 17

A. Ripeness goes to Article III case or con-

Sy ee rT Peery 17

B. The decision in First English had no effect

on jurisdictional prerequisites of a taking

CU save che postin a eres eratad ertsnes 22

C. If an Article III case or controversy does

not exist, prudential considerations are

SING kino i otucs wide soe eee cnn ss 22

V. THERE IS NO CONFLICT BETWEEN FED-

ERAL RIPENESS RULINGS AND EXHAUS-

TION OF REMEDIES DOCTRINE. ........... 24

VI. THIS CASE PRESENTS NO OCCASION FOR

THE SUPREME COURT TO RECONSIDER

THE FUTILITY EXCEPTION TO THE RIPE-

NESS DOCTRINE ANNOUNCED IN MAC-

; UNIS or ve eed een isce ee rs 26

PIII ca eve ahve vueuaceeeererrinssene 27

| MII os ca oe sn oh ce dncans: aver rer revere l-a

TABLE OF AUTHORITIES

Page

Cases

Abbott Laboratories v. Gardner, 387 U.S. 136 (1967) ...22, 23

Agins v. City of Tiburon, 447 U.S. 255 (1980)

+4 sgh 9 hee oe aaa ree ode aie ee eee 16, 17, 18, 20

Ashwander v. ‘iennessee Valley Auth., 297 U.S. 288

CPN 5 Ss-0.c-0 no cues Seu ene eecakes cae nd geen 23

Beure-Co. v. United States, 16 Cl. Ct. 42 (1988)....... 27

Biddison v. City of Chicago, 921 F.2d 724 (7th Cir.

ON a5 SLES COUN ee beeen cane eae 14, 21

Ciampetti v. United States, 18 Cl. Ct. 548 (1989)...... 27

. City of Abilene v. Downs, 367 S.W.2d 153 (Tex. 1963) .... 13

City of Austin v. Teague, 570 S.W.2d 389 (Tex. 1978) .... 13

City of El Paso v. Madero Development, 803 S.W.2d

Fee Cl EA. TU, Fe Reece sete xcttcsak. 44,747, 21

Corn v. City of Lauderdale Lakes, 816 F.2d 1514 (11th

Tabs ci eerees ees Cad ees oe Ea ew Coen hee ee 27

de St. Aubin v. Flacke, 68 N.Y.2d 66, 505 N.Y.S.2d

a Re | ee er 27

First English Evangelical Lutheran Church v. County

of Los Angeles, 482 U.S. 304 (1987) ............. is; Se

Formanek v. United States, 18 Cl. Ct. 785 (1989)...... 27

Hodel v. Virginia Surface Mining & Reclamation

FOG 0, CGE Ee. a a vc ged cin nnscds 18, 19

Hoehne v. County of San Benito, 870 F.2d 529 (9th

CO FRR have case eck ucuce velar se niaeyeneie ayers os 27

Howlett v. Rose, 110 S. Ct. 2430 (1990)............... 15

vi

TABLE OF AUTHORITIES - Continued

Page

International Longshoremen’s Ass'n v. Davis, 476

ee | ere ere tee ac ye 13

Keystone Bituminous Coal Ass’n v. DeBenedictis, 480

Oe ere ers eee 11, 2, 21

MacDonald, Sommer & Frates v. County of Yolo, 477

Re UE MOO one ycidneieacen 16, 18, 19, 20, 25, 26

Madero Development and Constr. Co. v. City of El

Paso, No. EP-86-CA-403, slip op. (W.D. Tex. “Dec.

Beg HUE oc0ac ks ecde vs ka ate KEG aCe oe aks 1, 12

Mayhew v. Town of Sunnyvale, 774 S.W.2d 284 (Tex,

Sn ey meme irinet, Senpeyr 26

Michigan v. Long, 463 U.S. 1032 (1983)............ 13, 35

Miller v. Campbell County, 945 F.2d 348 (10th Cir.

ah ET EE Te ETO oa tae 14

Minnesota v. National Tea Co., 309 U.S. 551 (1940)....15

Molins PLC v. Quigg, 837 F.2d 1064 (Fed. Cir. 1988),

cert. denied, 486 U.S. 1055 (1988).................. 23

Mondou v. New York, N.H.&.H. R.R. Co., 223 U.S. 1

SOE Cal ees Skee nates aves Fae he eee Tae Wee Oe 15

O’Shea v. Littleton, 414 U.S. 448 (1974)............... 18

Patsy v. Florida Board of Regents, 457 U.S. 496 (1982) .... 25

Payton v. New York, 445 U.S. 573 (1980) ............. 13

Pennell v. City of San Jose, 485 U.S. 1 (1988)......... 19

Poe v. Ullman, 367 U.S.. 497 (1961)...........0...0005. 23

Preseault v. Interstate Commerce Comm'n, 110 S. Ct.

Sr ae nee aT ee 18

vii

TABLE OF AUTHORITIES - Continued

Rescue Army v. Municipal Court, 331 U.S. 549 (1947) .... 23

Ruckelshaus v. Monsanto Co., 467 U.S. 986 (1984)..... 18

Samaad v. City of Dallas, 940 F.2d 925 (5th Cir. 1991) .13, 21

Schnuck v. City of Santa Monica, 935 F.2d 171 (9th

es BIRR INE Re an ee are ROCs Er ae 13

Socialist Labor Party v. Gilligan, 406 U.S. 583 (1972)... . 23

Southern Pac. Transp. Co. v. City of Los Angeles, 922

F.2d 498 (9th Cir. 1990), cert. denied, 112 S.Ct. 382

| UE RR POON Pan EN OM a REM ee oS eae 21

Suess Builders Co. v. City of Beaverton, 295 Or. 254,

ee Sy AUPE oe od Sein 604s Gen pete e es tees 14

Village of Euclid v. Ambler Realty Co, 272 U.S. 398

ALi ce hchnasinGhnSus iene vinesiTeCenre ne vse 11

Williamson County Regional Planning Comm'n v.

Hamilton Bank of Johnson City, 473 U.S. 172

itt Nara ss fare ue aur epaeen ones ees passim

Zacchini v. Scripps-Howard Broadcasting Co., 433

SA SONU ere ies arnsraseederes boner yes 15

PROCEDURAL RULES

OPINIONS BELOW

Petitioners’ Petition omits the relevant opinion of the

United States District Court for the Western District of

Texas in the case styled Madero Development and Construc-

tion Co. v. City of El Paso, No. EP-86-CA-403 (Dec. 21,

1988). That opinion, which is unreported, is included in

Respondents’ Appendix, at p.l-a. The other relevant

opinion, City of El Paso v. Madero Development, 803 S.W.2d

396 (Tex. Ct. App. 1991), is contained in Appendix A of

the Petition for Writ of Certiorari.

+

JURISDICTION

Petitioners have failed to allege a constitutional vio-

lation invoking the jurisdiction of this Court since the

mere enactment of the City’s zoning ordinance does not

violate the Just Compensation Clause of the Fifth Amend-

ment or any other section of the United States Constitu-

tion. Further, the Constitution of the State of Texas

provides a compensation remedy, which Petitioners have

not yet pursued.

¢

CONSTITUTIONAL PROVISIONS, STATUTES

AND ORDINANCES INVOLVED

The Fifth Amendment to the United States Constitu-

tion provides in pertinent part as follows:

No person shall. . . be deprived of life, liberty,

or property, without due process of law; nor

shall private property be taken for public use,

without just compensation.

The Fourteenth Amendment to the United States

Constitution provides in pertinent part as follows:

No State shall make or enforce any law which

shall abridge the privileges or immunities of

citizens of the United States; nor shall any State

deprive any person of life, liberty, or property,

without due process of law .. .

Article I, § 17 of the Texas Constitution provides in

pertinent part as follows:

No person’s property shall be taken, damaged

or destroyed for or applied to public use with-

out adequate compensation being made, unless

by the consent of such person; and, when taken,

except for the use of the State, such compensa-

tion shall be first made, or secured by a deposit

of money...

Pertinent provisions of the City of El Paso Ordi-

nances and Texas Local Government Code are attached as

Appendices “D” and “E” respectively, of the Petition for

Writ of Certiorari.

STATEMENT OF THE CASE

A. Respondents’ Statement of Facts

Petitioner’s Statement of the Case fails to specify the

stage in the proceedings, both in the District Court and in

subsequent proceedings, at which the Questions Pre-

sented for Review were raised or to otherwise comply

with the provisions of Supreme Court Rule 14.1(h). Fur-

ther, Petitioners’ Statement of the Case is argumentative,

fails to cite the record below, and presents a misleading

and inaccurate account of the facts regarding their litiga-

tion against the City of El Paso in the federal and state

courts.

Respondents do not accept Petitioners’ statement of

the facts of this case and would substitute the following

statement:

Petitioners in this case, Madero Development and

Construction Co. and Chaparral Equity Corp., allege that

the rezoning of their property by the City of El Paso to

Planned Mountain Development (PMD) constituted a

compensable taking.

Richard Miller purchased 100 acres on Crazy Cat

Mountain in the City of El Paso in the late 1960s, (SF

929).! Miller obtained rezoning for 67 acres of the prop-

erty from R-3 to Planned Unit Development (Def.Exh. 1;

SF 957-958, 930), and received approval for two single-

family residential units per acre in a development known

as “Sierra Crest,” (Def.Exh. 2; SF 965). The remaining 33.9

acres retained the R-3 zoning classification, (SF 283-285,

508). Subsequently, Miller built several single family resi-

dences in Sierra Crest and sold all remaining lots, (SF

971-972).

At the public hearing for Miller’s rezoning, the Kern

Place Association voiced opposition to the project based

on environmental and safety considerations, (SF 963-964).

Rolando Madero, who was employed as Miller’s urban

' For the purposes of this brief and in compliance with

Tex. R. App. P. 74(f) (1989), the trial court records will be

designated: SF — Statement of Facts; Def.Exh. - Defendant's

Exhibit; Pl.Exh. — Plaintiff's Exhibit; Tr. —- Transcript.

designer at the time, was aware of the neighbors’ opposi-

tion to development of the property, (SF 490-491, 967).

Madero purchased the remaining 33.9 acres from Miller

for $200,000 in 1979, (Def.Exh. 82; SF 295). This parcel

ultimately became known as Madero Hills and is the

subject of this law suit.

In February of 1982, Madero sold 1.417 acres of the

parcel to Jorge Angulo for development purposes,

(Def.Exh. 88; SF 292). In 1984, Madero sold approximately

one quarter of an acre of the property he owned in fee

simple, (Def.Exh. 141; SF 293, 1262, 810). After these sales,

Madero Hills currently consists of approximately 32

acres, (Def.Exh. 66; SF 1261-1265). Of that 32 acres, Miller

owns 20 acres due to partial foreclosure after Madero

defaulted on the purchase money mortgage loan,

(Def.Exh. 86; SF 936, 937, 946).

Madero sought to subdivide the property under the

R-3 zoning, resulting in preliminary approval by the City

Planning Commission (CPC) of the first phase of Madero

Hills in July, 1981, consisting of two single family and

four duplex units on 1.87 acres of land, (PI.Exh. 30; SF

340, 671). (Miller took no part in efforts to develop Mad-

ero Hills, (SF 671, 942, 967)). Preliminary approval of Unit

One was conditioned in part on submission and approval

of a drainage study, (P1.Exh. 30).

Following a request by the CPC, Madero submitted

an application for preliminary approval of a Master Plan

for all of Madero Hills in November, 1981, (P1.Exh. 32,

126; SF 344). The Master Plan proposed development of

77 lots in four phases over 33.9 acres, (PI.Exh. 32;

Def.Exh. 126; SF 614-618, 674-675). The CPC approved the

development concept in the Master Plan and granted

preliminary approval to phases two through four of the

plat in July, 1982, (Pl.Exh. 39, 42; SF 346, 677-679). All

approvals were subject to conditions, which were stan-

dard. Id.

In December, 1982, the CPC gave final conditional

approval to Unit One of Madero Hills, subject to subse-

quent approval of a geological study for the site, a street

drainage plan and a grading plan, (Def.Exh. 29; SF

346-347, 682-683). Thereafter, Madero sought approval for

a revised final plat, with reconfigured “panhandle” lots,

(Def.Exh. 30, 152; SF 701-703, 707, 712). The CPC eventu-

ally approved a revised plat (December, 1983), subject to

similar conditions as imposed on the original plat,

(Def.Exh. 34, 37, 38; Pl.Exh. 55; SF 713, 714, 1391-1392).

The City Council conditionally approved Madero’s

Mountain Development Area (MDA) grading permit

application for Unit One, following appeal from CPC

approval by the Kern Place Association, in July, 1984,

(P1.Exh. 65, 77). Madero did not meet the conditions

attached to the grading permit, (P].Exh. 84; SF 809,

1035-1036, 1316-1318). All engineering work on the pro-

ject by Madero ceased following the City’s conditional

approval of the grading permit, (SF 808, 1316-1317).

Madero did not take further steps required by City

ordinance to obtain final plat approval for Units Two,

Three and Four of Madero Hills. Madero did not meet the

conditions attached to the final plat for Unit One and did

not record the plat with the El Paso County Clerk, as

required by City subdivision regulations and state law,

(SF 1391-1392, 1423-1424, 1475). On August 13, 1985, the

City notified Madero that his subdivision file for Unit

One was closed officially due to inactivity for more than

one year and that, pursuant to the subdivision ordinance,

approval had lapsed, (P1.Exh. 83; Def.Exh. 106, VI D.1; SF

1403-1404). Thus Petitioners by their own inaction did not

even complete processing of the development application

under the former ordinance no less the new ordinance

under attack.

The City Council passed the PMD Ordinance on

December 4, 1984,? (P].Exh. 1, Ord. No. 8226.3). The pur-

poses of the PMD district are:

(1) to protect significant natural features of the

Mountain Development Area and preserve

the City’s unique visual setting as part of

the comprehensive plan;

(2) to provide an alternative approach to con-

ventional flatland development by allowing

transfer of residential densities through

clustering of dwellings in order to preserve

larger areas of open space;

(3) to minimize scarring and disturbances of

the natural character of the Mountain

Development Area through control of gra-

ding and cut/fill operations as defined in

the Grading Ordinance;

(4) to control water runoff and soil erosion;

(5) to provide a safe means of ingress and

egress for vehicular and pedestrian traffic

to and within the Mountain Development

Area; and

2 This ordinance is reprinted as Appendix D of the Petition

for Writ of Certiorari.

(6) to encourage sound engineering practices

related to mountain development.

On January 14, 1986, the City Council rezoned all

property within the MDA to PMD, except for those prop-

erties that fell within an exemption, (P].Exh. 2, Ord. No.

8561). The majority of Madero Hills was zoned PMD;

however, a portion of Unit One remains R-3, (SF 800-802,

811-813, 1262-1263). Madero Hills was one of several

hundred properties rezoned to PMD on January 14, (SF

1351, 1255).

Under the PMD Ordinance, the density of develop-

ment is related, in part, to slope of the land, (Appendix D,

PMD Ord. §§ 25-24.8, -24.9, -24.10). Madero Hills has an

average slope of forty-eight (48%) percent, (P1.Exh. 90; SF

457). Under the PMD and R-3 zoning, Madero can

develop up to 26 single family residential units on the

property without obtaining variances, (SF 1243,

1260-1265). In addition, the PMD Ordinance authorizes,

as uses permitted by right, multiple-family and duplex

residential development and recreational facilities,

(Appendix D, PMD Ord. § 25-24.4; SF 1185). The ordi-

nance further authorizes by special permit other uses,

such as resort lodging, retail shopping facilities and thea-

ters, (Appendix D, PMD Ord. § 25-24.7; SF 1185). Madero

did not make application for any use under the PMD

regulations, nor did Madero make application for a vari-

ance or special permit to the Zoning Board of Adjust-

ment, (SF 830-831; City’s Bill of Exceptions, Exh. B, City

Code §§ 2.16.010 et seq., Vol. IV, Tr. 1381-1383 (Addendum

B); Exh. E, Vol. IV, Tr. 1583-1588).

Instead, Madero directly filed suit in the United

States District Court for the Western District of Texas,

alleging that the rezoning of Madero Hills constituted a

taking of their property without just compensation. In

late December, 1988, the federal District Court dismissed

Madero’s suit as unripe. Specifically, the court ruled that

Madero had failed to utilize either the variance pro-

cedures authorized by state and local laws or the state

court procedures for just compensation.

Less than a month later, Madero filed essentially the

same action in state court, without returning to the City

to process the application under the PMD Ordinance or to

seek a variance from the PMD Ordinance. Madero was

successful at trial, but the judgment was reversed by the

Texas Court of Appeals on grounds of ripeness.

B. Misstatements of Fact in Petitioners’ Statement

of the Case

In addition to omitting pertinent facts, Petitioners’

Statement of the Case contains factual inaccuracies and

argumentative conclusions which require a response.

1. On pages 4 and 5 of the Petition, Petitioners

allege that Unit One of Madero Hills was subjected to

unusual and impossible conditions. In fact, the approval

of Unit One was subject only to standard development

conditions, imposed by Respondents for health and safety

reasons. (PI.Exh. 30; Def.Exh. 29; SF 346-347, 682-683). Peti-

tioners adduced no evidence at trial to prove that these

conditions were either out of the ordinary or impossible to

meet.

2. On page 5, Petitioners argue that the approval of

Unit One was wrongfully terminated. Respondents res-

cinded their approval of Unit One due to Petitioners’

inaction on the project for over a year and their failure to

meet the conditions imposed upon that approval. More-

over, Petitioners failed to record a final plat with the E]

Paso County Clerk, as required by state and local law.

(PILExh. 84, SF 809, 1035-1036, 1316-1318, 1391-1392,

1423-1424, 1475).

3. The statement on page 6 that “[i]t was not eco-

nomically feasible to subdivide Madero Hills into only

eleven lots” is merely Petitioners’ legal opinion. Given

that Petitioners never attempted to develop their prop-

erty under the PMD Ordinance, this conclusion has no

basis in fact or law. (SF 830-831; City’s Bill of Exceptions,

Exh. B, City Code §§ 2.16.010 et seq., Vol. IV. Tr. 1381-1383

(Addendum B); Exh. E, Vol. IV. Tr. 1583-1588).

4. Contrary to the misstatement on page 6, Peti-

tioners failed to present any competent evidence of futil-

ity. The testimony of certain city council members was

ruled to be incompetent evidence by the Texas Court of

Appeals. Moreover, Petitioners’ claim that the Zoning

Board of Adjustment is powerless to grant Petitioners a

variance is a legal conclusion rejected by the Texas Court

of Appeals.

SUMMARY OF ARGUMENT

There are no grounds on which to accept review of

the state court decision, based on the following points:

10

1. The Texas Court of Appeals’ disposition of this

case on grounds of ripeness was premised upon Article I,

Section 17, of the Texas Constitution. No federal or state

taking claim is mature because an adequate state compen-

sation remedy exists under the Texas Constitution and

Petitioners were free to pursue such remedy and totally

failed to do so.

2. Even if the Texas Court of Appeals reached the

federal ripeness issue concerning the availability of local

remedies, the court correctly applied the federal ripeness

doctrine.

3. Ripeness of an as applied regulatory taking claim

goes to the subject matter jurisdiction of the court, both

under state law and federal law. No taking claim accrues

until such ripeness requirements are satisfied.

4. This case presents no occasion for the Supreme

Court to reconsider the futility exception to the ripeness

doctrine.

ARGUMENT

I. PETITIONERS WAIVED ANY CHALLENGE TO

THE FACIAL VALIDITY OF THE REGULATIONS

Petitioners pleaded and tried this case solely as an as

applied regulatory taking claim. Petitioners expressly

waived any challenge to the facial validity of the Planned

Mountain Development regulations as expressly

acknowledged by their appellate brief:

(1) Appellees filed this inverse condemnation

action alleging, among other things, that

11

the PMD Zoning Ordinance, as applied to

Madero Hills, constituted a taking without

compensation in violation of the Texas Con-

stitution, Article 1, Section 17, and the Fifth

and Fourteenth Amendments of the United

States Constitution. (Petitioners’ Brief to

Texas Court of Appeals, June 15, 1990, page

XI);

(2) The trial court expressly found that the

application of the PMD to Appellees prop-

erty constituted a compensable “taking.”

The jury in this case also found that a “tak-

ing” had occurred. Appellants’ arguments

under this point of error concerning a facial

attack of the PMD Zoning Ordinance are not

before this Court. (emphasis supplied). Peti-

tioners’ Brief to Texas Court of Appeals,

June 15, 1990, page 29).

The Texas Court of Appeals disposed of Petitioners’ claim

for want of subject matter jurisdiction under Article I,

Section 17, of the Texas Constitution (the taking clause).

Unlike Village of Euclid v. Ambler Realty Co., 272 US.

398 (1926), this case does not involve issues concerning

the facial or general validity of the PMD regulations or

heir relationship to public health and safety, as in Key-

stone Bituminous Coal Ass’n v. DeBenedictis, 480 U.S. 470

(1987). Such matters were conceded during trial. Conse-

quently, the Texas Court of Appeals reviewed only an “as

applied” regulatory taking claim in reaching its decision.

12

II. BECAUSE A STATE CONSTITUTIONAL REMEDY

IS AVAILABLE, PETITIONERS’ FEDERAL TAK-

ING CLAIM HAS NOT MATURED.

In Madero Development and Constr. Co., Inc. v. City of El

Paso, No. EP-86-CA-403, slip op. (W.D.Tex. Dec. 21, 1988)

(Appendix at p.1-a), the United States District Court for

the Western District of Texas granted the City of El Paso’s

motion for summary judgment dismissing Petitioners’

claims as unripe. The court held that Madero had failed

to obtain a final decision from the City applying its

Planned Mountain Development Ordinance to Madero’s

land. The court further held that Madero had adequate

state remedies available. Accordingly, both prongs of Wil-

liamson County Regional Planning Comm'n v. Hamilton Bank

of Johnson City, 473 U.S. 172 (1985) were applied to Mad-

ero. Instead of filing an appeal of the District Court’s

holding or seeking a variance from the City, Madero

instead filed a damages action in state court. In the litiga-

tion that followed, the Texas Court of Appeals held,

under Texas law, that a variance was available to Peti-

tioners and, again under Texas law, that Madero’s claims

were unripe under Article I, Section 17, of the Texas

Constitution. As with Madero’s federal action, its state

claim was dismissed without prejudice.

Madero failed to file an appeal of the District Court’s

decision which, as a matter of federal law, was due within

30 days after the decision. F.R.App.P. 4(a)(1). As dis-

cussed above, the Texas Court of Appeals determined, as

a matter of state law, that Madero’s claim for just compen-

sation was premature. The state court determination as to

Madero’s claims under the Texas Constitution is purely a

13

matter of state constitutional law, unreviewable by this

Court. International Longshoremen’s Ass'n v. Davis, 476 U.S.

380, 387 (1986) (“[W]e have no authority to review state

determinations of purely state law.”); Michigan v. Long,

463 U.S. 1032, 1041 (1983) (“It is fundamental that state

courts be left free and unfettered by us in interpreting

their state constitutions.”); Payton v. New York, 445 U.S.

573, 600 (1980) (“[B]y invoking a state constitutional pro-

vision, a state court immunizes its decision from review

by this Court.”).

Moreover, this state court determination of its own

jurisdiction does not alter the fact that Texas law provides

an adequate monetary remedy in the event that state land

use regulations constitute a taking. See Samaad v. City of

Dallas, 940 F.2d 925, 935-36 (5th Cir. 1991); City of Austin v.

Teague, 570 S.W.2d 389 (Tex. 1978); City of Abilene v.

Downs, 367 S.W.2d 153, 159 (Tex. 1963). Following this

Court’s ruling in First English Evangelical Lutheran Church

v. County of Los Angeles, 482 U.S. 304 (1987), all state

courts must obviously provide monetary relief for tempo-

rary takings. See Schnuck v. City of Santa Monica, 935 F.2d

171, 173 (9th Cir. 1991).

Because the State of Texas provides an adequate pro-

cess for obtaining just compensation, there can be no

taking under the Fifth Amendment unless and until the

landowner has appropriately utilized the state’s pro-

cedures for obtaining just compensation. Williamson

County, 473 U.S. at 194-97. In Williamson County, this

Court explained that the Fifth Amendment does not

require that “just compensation be paid in advance of, or

contemporaneously with, the taking; all that is required is

that a ‘reasonable, certain and adequate provision for

14

obtaining compensation’ exist at the time of taking.” 473

U.S. at 194. Thus, as a matter of law, “no constitutional

violation occurs until just compensation has been denied

[by the state].” 473 U.S. at 194 n.13. See also Biddison v.

City of Chicago, 921 F.2d 724, 729 (7th Cir. 1991) (“His

federal claim will ripen . . . if and when Biddison is

denied just compensation by the state courts.”); Miller v.

Campbell County, 945 F.2d 348, 352 (10th Cir. 1991)(“In the

instant case, the plaintiffs have pending under Wyoming

law an inverse condemnation action to recover compen-

sation for the loss of their homes. . . . Because the plain-

tiffs have not yet been turned away empty-handed, it is

not clear whether their property has been taken without

just compensation.”); see also Suess Builders Co. v. City of

Beaverton, 295 Or. 254, 656 P.2d 306 (1982). As the District

Court resolved herein, as a matter of federal law, Mad-

ero’s takings claim is not ripe at this time.

The Texas Court of Appeals dismissed Madero’s

claims because, as a matter of state law, the trial court

lacked subject matter jurisdiction. Specifically, the court

held that because Madero failed to apply for a variance

from the PMD Ordinance, its inverse condemnation

claims are not ripe, and under Texas law ripeness goes to

a court’s subject matter jurisdiction. City of El Paso v

Madere- Development, 803 S.W.2d 396, 399-400 (Tex. Ct.

App. 1991).

While the court relied on certain opinions of this

Court regarding the ripeness issue in inverse condemna-

tion cases, in determining the ultimate issue of subject

matter jurisdiction the court relied exclusively on Texas

state opinions. Thus, in citing federal opinions, the court

relied on them not as binding precedents on the state law

15

issue, but as guidance in the same way the court might

rely on the opinion of another state court. Nothing in the

opinion suggests that the Texas court dismissed Madero’s

cause because it “felt compelled by what it understood to

be federal constitutional considerations to construe . . . its

own law in the manner it did.” Michigan v. Long, 463 U.S.

at 1044 (quoting Zacchini v. Scripps-Howard Broadcasting

Co., 433 U.S. 562, 568 (1977)). See also Minnesota v. National

Tea Co., 309 U.S. 551, 556 (1940)(“It is possible that the

state court employed the decisions under the federal

constitution merely as persuasive authorities for its inde-

pendent interpretation of the state constitution. If that

were true, we would have no jurisdiction to review.”)

Under principles of federalism and comity, it has

long been understood that states are free to control and

define the jurisdiction of their courts without interference

from federal law. Even in cases where federal claims are

present, federal law does not “enlarge or regulate the

jurisdiction of state courts, or . . . control or affect their

modes of procedure.” Howlett v. Rose, 110 S. Ct. 2430, 2441

(1990) (quoting Mondou v. New York, N.H.&.H. R.R. Co.,

223 U.S. 1, 56 (1912)).

Ill. A DEVELOPMENT APPLICATION AND FINAI

DECISION ARE REQUIRED.

The decision of the Texas Court of Appeals is entirely

consistent with the decisions of this Court relating to

ripeness. The court correctly declined to analyze the eco

nomic effect of the City’s zoning legislation on the basis

16

of hypothetical plans which were never presented to the

City.

As appears from the record, Petitioners had no pend-

ing development application on file with the City when

the Planned Mountain Development Ordinance was

enacted. Petitioners never submitted any development

application, much less a request for a variance or change

in zoning classification, following the adoption of the

PMD Ordinance. In fact, the only development applica-

tion which was ever finalized on the property was for the

first phase of a subdivision for approximately three per-

cent of the development site. Even this approval lapsed

for the Petitioners’ failure to satisfy reasonable conditions

prior to the rezoning.

The court did not rely upon this ground, however, in

disposing of Petitioners’ claim. Rather, the court held that

a variance procedure was available under Texas law and

under local ordinance by which Petitioners could obtain

relief from the PMD regulations. This holding, which is

based entirely on state law, must be given great respect

by this Court. MacDonald, Sommer & Frates v. County of

Yolo, 477 U.S. 340, 352 n.8 (1986); Agins v. City of Tiburon,

447 U.S. 255, 259 n.6, 262 (1980). In the complete absence

of a variance request and any development application,

the court refused to entertain Petitioners’ arguments that

the El Paso Zoning Board of Adjustment could not grant a

variance in harmony with the PMD Ordinance, stating:

There is then, a question of degree in determin-

ing whether a particular variance would violate

the spirit of the zoning laws. Some number of

density of lots over eleven may or may not [be

authorized], and that must be determined by the

17

zoning board of adjustment acting within its

guidelines. After this degree is attained, the

degree of taking can be arrived at. These

degrees not only affect whether there is a taking

but are relevant to the market value of the prop-

erty for the purposes of establishing damages, if

there is a taking.

City of El Paso, 803 S.W.2d at 401.

As recognized by the Texas Court of Appeals, this

fact pattern is precisely the reason why federal courts

fashioned ripeness requirements for regulatory taking

claims. The facts in this case present familiar ground,

which this Court and the lower courts have considered

and mandated that a development application and

attempts to obtain administrative relief from otherwise

harsh impacts are necessary prerequisites to review of

claims based upon the Just Compensation Clause of the

Fifth Amendment.

IV. EVEN IF THE COURT OF APPEALS REACHED

THE FEDERAL RIPENESS QUESTION, IT COR-

RECTLY RULED THAT RIPENESS IN THE CON-

TEXT OF AN AS APPLIED REGULATORY

TAKING CLAIM IS JURISDICTIONAL UNDER

FEDERAL LAW. NO TAKING CLAIM ACCRUES

UNTIL RIPENESS REQUIREMENTS ARE SATIS-

FIED.

A. Ripeness goes to Article III case or controversy.

This Court has unequivocally held that a develop-

ment application and a request for a variance or other

18

form of administrative relief normally are essential pre-

requisites to judicial review of an as applied regulatory

taking claim premised on the Fifth Amendment of the

United States Constitution. MacDonald, 477 U.S. at 351;

Williamson County, 473 U.S. at 194; Hodel v. Virginia Sur-

face Mining & Reclamation Ass‘n, Inc., 452 U.S. 264 (1981);

Agins, 447 U.S. at 261. The Court also has determined that

there can be no as applied regulatory taking claim as long

as there is a “reasonable, certain and adequate provision

for obtaining compensation at the time of the taking.”

Williamson County, 473 U.S. at 194.

It is undeniable that Article II] requires a plaintiff to

present a ripe controversy. O’Shea v. Littleton, 414 U.S. 488

(1974). In Agins, plaintiff’s failure to submit a develop-

ment application under the zoning ordinance in question

left plaintiff’s as applied takings challenge premature for

lack of a “concrete controversy.” 447 U.S. at 260. In Wil-

liamson County, plaintiff’s failure to seek a variance left it

“impossible for the jury to find, on this record, whether

respondent ‘will be unable to derive economic benefit’

from the land.” 473 U.S. at 172. Moreover, the Court

determined that until a landowner seeks compensation

through state procedures, it cannot be said that the state

has violated the Just Compensation Clause of the Fifth

Amendment: “Thus, the State’s action is not ‘complete’ in

the sense of causing a constitutional injury ‘unless or

until the State fails to provide an adequate postdepriva-

tion remedy for the property loss.’ ” 473 U.S. at 172. See

also Preseault v. Interstate Commerce Comm’‘n, 110 S. Ct. 914

(1990); Ruckelshaus v. Monsanto Co., 467 U.S. 986 (1984)

(taking claim against the Federal Government premature

until landowner has sought compensation under the

Tucker Act).

19

In MacDonald, the Court explained:

It follows from the nature of a regulatory tak-

ings claim that an essential prerequisite to its

assertion is a final and authoritative determina-

tion of the type and intensity of development

legally permitted on the subject property. A

court cannot determine whether a regulation

has gone “too far” unless it knows how far the

regulation goes.

477 US. at 348.

Likewise, in Hodel, the Court found plaintiff's takings

challenge unripe because it had failed to utilize the

administrative remedies available to obtain relief from

the operation of the statute in question and because

plaintiffs had failed to identify “any property in which

appellees have an interest that has allegedly been taken

by operation of the Act.” 452 U.S. at 294. Given these

facts, the Court concluded that the case “presented no

concrete controversy concerning either application of the

Act to particular surface mining operations or its effect

on specific parcels of land.” 452 U.S. at 295. See also

Pennell v. City of San Jose, 485 U.S. 1 (1988).

A synthesis of these opinions plainly shows that the

Court rejected the takings claim in these cases because

the plaintiffs were unable to demonstrate that they had

been injured in fact by the local government. In other

words, absent a final decision from the local government

and an unsuccessful attempt to gain administrative relief

therefrom, it is impossible to say that there has been a

taking, 1.e., an injury redressable under the Fifth Amend-

ment. And, until a landowner has unsuccessfully sought

compensation through state courts, the property owner

20

cannot as a matter of law claim a violation of the Fifth

Amendment; no such violation has occurred at that point.

In sum, until the requirements of Agins, MacDonald and

Williamson County are satisfied, as a matter of law a

landowner cannot demonstrate that his Fifth Amendment

rights have been violated.

Petitioners would have the Court hold that the mere

legislative enactment of a zoning ordinance renders the

controversy concrete as to the regulation’s economic

impact on the landowner’s use of the property. This

proposition was fully explored and rejected in Williamson

County, MacDonald and Keystone Bituminous, and does not

require reexamination in this case.

Such a view is totally inconsistent with the nature of

the development process. Zoning constitutes only the

initial step in development of property and, hence, realiz-

ation of economic return. The nature of the use and the

intensity of development on the property cannot be deter-

mined until an application for a development permit of

some kind has been acted upon. Hence, the Court's

requirement that a development application be submitted

pursuant to the allegedly offending zoning regulations

goes to the concreteness of the controversy, not to pru-

dential considerations. Further, under all state zoning

enabling acts, a variance procedure has been incorpo-

rated in the very fabric of the authorization for zoning. A

variance is not an extraordinary remedy, but is part and

parcel of the process of deciding the permissible use and

intensity of use of land.

This Court’s rulings on finality precisely apprehend

the nature of the development process under local zoning

21

laws. As this Court long has recognized, regulatory tak-

ings are fundamentally different from physical takings, in

that the police power actions of local governments consti-

tute only a restraint on the use of the property consistent

with the notion of “reciprocity of advantage.” Keystone,

480 U.S. at 488-93. This Court has ruled that a property

owner must at least proceed through the normal develop-

ment process before the effect of the actions of local

government officials can be ascertained. Such a standard

goes directly to the case or controversy requirement

under Article III.

The Texas Court of Appeals followed this reasoning,

stating:

It follows from the nature of a regulatory tak-

ings claim that an essential prerequisite to its

assertion is a final and authoritative determina-

tion of the type and intensity of development

legally permitted on the subject property. A

court cannot determine whether a regulation

has gone “too far” unless it knows how far the

regulation goes.

City of El Paso, 803 S.W.2d at 400.

Nor is there any reason to examine the application by

lower federal courts of this Court’s ripeness guidelines.

The circuits consistently and correctly hold that ripeness

goes to subject matter jurisdiction. See, e.g., Biddison v.

City of Chicago, 921 F.2d 724, 726 (7th Cir. 1991); Samaad v.

City of Dallas, 940 F.2d 925, 934 (5th Cir. 1991); Southern

Pac. Transp. Co. v. City of Los Angeles, 922 F.2d 498, 502

(9th Cir. 1990).

B. The decision in First English had no effec. on

jurisdictional prerequisites of a taking claim.

Petitioners assert that the Court’s decision in First

English Evangelical Lutheran Church »,.County of Los

Angeles, 482 U.S. 304 (1987), impliedly overruled this

Court’s decisions on ripeness issues. Petitioners argue

that the Court’s ruling on the availability of compensa-

tion for temporary regulatory taking claims affected its

previous rulings on ripeness, necessitating further clari-

fication by this Court.

The First English decision addressed only the ques-

tion of the availability of compensation in the event that a

regulatory taking under the Fifth Amendment is actually

found. The decision presumed that a taking already had

occurred, due to the unique posture of the case, and did

not question whether the controversy was ripe for review.

482 U.S. at 311-13. First English neither abrogates nor in

any way alters the Court’s previous decisions on ripeness

and has no bearing on this case.

C. If an Article III case or controversy does not

exist, prudential considerations are irrelevant.

Petitioners argue that the Texas Court of Appeals,

together with many other lower federal and state courts,

have misapprehended the federal ripeness doctrine. In

particular, Petitioners assert that the controlling case is

Abbott Laboratories v. Gardner, 387 U.S. 136 (1967), in

which the Court held that the ripeness doctrine is

23

founded both on Article III case or controversy require-

ments and on certain prudential considerations. Peti-

tioners falsely reason that reviewing courts are required

to examine prudential factors, such as the relative hard-

ship to the parties, in every ripeness claim.

It is ironic that Petitioners claim that the ripeness of

their claim should be evaluated under the prudential

considerations of Abbott Laboratories instead of the case or

controversy requirement of Article III, because these pru-

dential considerations enlarge the grounds for dismissing

cases. See Socialist Labor Party v. Gilligan, 406 U.S. 583, 588

(1972) (“This Court has recognized in the past that even

when jurisdiction exists it should not be exercised unless

the case ‘tenders the underlying constitutional issues in

clean-cut and concrete form.’ Rescue Army v. Municipal

Court, 331 U.S. 549, 584 (1947).”); Poe v. Ullman, 367 U.S.

497, 502 (1961) (“The restriction of our jurisdiction to

cases and controversies within the meaning of Article III

of the Constitution .. . is not the sole limitation on the

exercise of our appellate powers, especially in cases rai-

sing constitutional questions.”); Ashwander v. Tennessee

Valley Auth., 297 U.S. 288, 341 (1935) (Brandeis, J., concur-

ring) (“The Court [has] developed, for its own gover-

nance in the cases confessedly within its jurisdiction, a

series of rules under which it has avoided passing upon a

large part of all the constitutional questions pressed upon

it for decision.”); Molins PLC v. Quigg, 837 F.2d 1064, 1068

(Fed. Cir. 1988) (“A case or controversy may be constitu-

tionally ripe for review but that does not automatically

invoke review. Prudential considerations must also be

satisfied.”).

24

No amount of prudential considerations can ever

expand the subject matter jurisdiction of federal courts to

render advisory opinions where Article III case or contro-

versy requirements are not met. The Texas Court of

Appeals unequivocally ruled that in the context of an as

applied regulatory taking claim ripeness goes to the sub-

ject matter jurisdiction of the case. Consequently, pruden-

tial considerations have no bearing on whether the court

has jurisdiction.

V. THERE IS NO CONFLICT BETWEEN FEDERAL

RIPENESS RULINGS AND EXHAUSTION OF

REMEDIES DOCTRINE.

Petitioners assert that the Court must clarify the rela-

tionship between exhaustion of administrative remedies

and ripeness in the context of taking claims, due to confu-

sion by lower courts in applying those doctrines. In Wil-

liamson County, the Court instructed that satisfaction of

ripeness principles was a necessary prerequisite to con-

sideration of as applied regulatory taking claims, but that

exhaustion of administrative remedies was not. The

Court clearly established that the requirements of a

development application and petition for variance fell

within the ripeness doctrine, not under the exhaustion of

administrative remedies doctrine.* 473 U.S. at 192-94.

3 It is immaterial, of course, whether state courts classify

such requirements as components of ripeness or exhaustion of

administrative remedies; it is not the label, but the availability

of alternative sources of relief, which determines whether a

court should exercise jurisdiction over the controversy.

25

The difference between these doctrines, as ex-

haustively explored in Williamson County, grows out of

the Court’s rulings that exhaustion of administrative

remedies is not a prerequisite to bringing a Section 1983

claim. In the context of civil rights claims, the exhaustion

of remedies doctrine generally applies to agency pro-

cedures which challenge the validity of a final decision

by the agency after the unconstitutional deprivation has

already occurred. See Patsy v. Florida Board of Regents, 457

U.S. 496 (1982). As stated in Williamson County, “the

exhaustion requirement generally refers to administrative

and judicial procedures by which an injured party may

seek review of an adverse decision and obtain a remedy if

a decision is found to be unlawful or otherwise inap-

propriate.” 473 US. at 193.

The variance procedure, classified as an element of

the ripeness doctrine in Williamson County, is not a pro-

cedure to evaluate the validity of zoning regulations or to

appeal zoning decisions. To the contrary, the variance

procedure is part and parcel of the normal statutory

scheme for determining the type and intensity of use

permitted on property in the face of alleged hardship to

the applicant. Thus variance, special use and rezoning

applications are necessary to determine the ultimate eco-

nomic impact and the character of the regulation — two of

the “essentially ad hoc, factual inquiries” that make up

takings analysis. MacDonald, 473 U.S. at 349.

The guidelines established in Williamson County for

differentiating between procedures which fall under the

ripeness doctrine and those which fall under the exhaus-

tion of remedies doctrine are clear. Lower courts have no

26

problems applying such procedures. This case presents

no occasion for reconsidering the guidelines.

VI. THIS CASE PRESENTS NO OCCASION FOR THE

SUPREME COURT TO RECONSIDER THE

FUTILITY EXCEPTION TO THE RIPENESS DOC-

TRINE ANNOUNCED IN MACDONALD.

Petitioners assert that this Court should reexamine

and clarify its futility “exception” to ripeness require-

ments. In McDonald, this Court decided that, under

extraordinary circumstances, the property owner could

be excused from complying with ripeness requirements

by demonstrating that it would be futile to proceed with

a development application or variance request; bare alle-

gations of futility would not, however, suffice to establish

futility.

The Court of Appeals correctly disposed of Peti-

tioners’ contentions that development applications and

variance requests were futile due to statements of partic-

ular legislators about the enactment of the PMD regula-

tions. Under both state and federal law, the subjective

intent of individual legislators is incompetent evidence

by which to establish the intent of the City in the enact-

ment of land use regulations. Regan v. Wald, 468 U.S. 222

(1984); Mayhew v. Town of Sunnyvale, 774 S.W.2d 284 (Tex.

Ct. App. 1989).

The state court conclusively determined that the vari-

ance remedy was available in order to obtain relief from

the allegedly harsh effects of local zoning regulations.

The decision of the Texas Court of Appeals as to the

availability of the local remedy is one purely of state law

not subject to review by this Court.

27

Contrary to Petitioners’ assertions, lower courts have

followed the Court’s outline of the futility exception in

formulating reasonable rules for determining whether a

property owner should be excused from finality require-

ments. It is true, as Petitioners assert, that some courts

have found that futility simply may not be established in

the absence of at least one development application. This

logic is premised upon the same reasoning that underlies

the ripeness doctrine: avoidance of premature speculation

on the type and extent of development that would be

allowed under local regulations.

Lower courts have established futility exceptions on

a number of grounds, including (1) unavailability of vari-

ance procedure (Beure-Co. v. United States, 16 Cl. Ct. 42

(1988); Formanek v. United States, 18 Cl. Ct. 785 (1989)); (2)

ground for denial of application was not compatible with

subsequent development application (Ciampetti v. United

States, 18 Cl. Ct. 548 (1989)); (3) submission of multiple

applications unnecessary (de St. Aubin v. Flacke, 68 N.Y.2d

66, 505 N.Y.S.2d 859, 496 N.E.2d 879 (1986)); (4) legislative

action such as enactment of a moratorium precluded the

proposed use of the property (Corn v. City of Lauderdale

Lakes, 816 F.2d 1514 (11th Cir. 1987)); and (5) rezoning of

property precluded use for which development applica-

tion was filed (Hoehne v. County of San Benito, 870 F.2d 529

(9th Cir. 1989)). None of these situations is even remotely

present in this case.

CONCLUSION

The Texas Court of Appeals disposed of Petitioners’

taking claim on state constitutional grounds. Because a

28

state constitutional remedy exists, a federal clain: has not

matured. Petitioners are free to pursue the compensation

remedy under the Texas Constitution by taking the two

steps necessary under state law to perfect their as applied

taking claim: (1) submitting a development application

under the challenged regulations; and (2) seeking a vari-

ance.

Even if the Court of Appeals reached the federal

ripeness issue, the court correctly applied federal law.

This case presents no extraordinary facts which would

form the basis for a different direction in federal jurispru-

dence on the taking question. Nor have Petitioners

pointed out any conflict among federal circuits in apply-

ing the ripeness doctrine outlined by this Court over the

last decade. In fact, Petitioners concede that both federal

and state lower courts uniformly apply ripeness princi-

ples to dispose of premature as applied taking claims,

although the result is not to the Petitioners’ liking. Peti-

tioners have presented no grounds for review of the

decision of the Texas Court of Appeals. ae

For these reasons, Petitioners’ Petition for Writ of

Certiorari should be denied.

Respectfully submitted,

Rosert H. FReILicu

(Counsel of Record)

RicHARD G. CARLISLE

TerrRY D. Morcan

FREILICH, LEITNER, CARLISLE

& SHORTLIDGE

1000 Plaza West

4600 Madison

Kansas City, Missouri 64112

(816) 561-4414

Counsel for Respondents

l-a

APPENDIX

IN THE UNITED STATES DISTRICT COURT FOR THE

WESTERN DISTRICT OF TEXAS

MADERO DEVELOPMENT AND

CONSTRUCTION COMPANY,

INC., a Texas Corporation, and

CHAPARRAL EQUITY

CORPORATION, a Texas

Corporation,

Plaintiffs,

No. EP-86-CA-403

Vv.

CITY OF EL PASO, TEXAS,

a Municipal Corporation, and

CITY PLAN COMMISSION,

Defendants.

)

)

)

)

)

)

)

)

)

)

)

)

)

ORDER REGARDING MOTIONS

FOR SUMMARY JUDGMENT

This is an action for damages and other relief under

42 U.S.C. §§ 1983 and 1985 and the Fourteenth Amend-

ment to the Constitution of the United States. The Plain-

tiffs also ask the Court to accept pendent jurisdiction over

a claim pursuant to Article 1, § 17, of the Texas Constitu-

tion. Both parties have filed motions for summary judg-

ment. The Defendants have also filed a motion for leave

to file an amended answer, which the Plaintiffs oppose.

The facts are relatively undisputed. In 1979, Chapar-

ral Equity Corporation, one of the Plaintiffs herein, sold a

thirty-acre tract of land to one Rogelio Madero. Madero

later conveyed the land to the other Plaintiff, Madero

2-a

Development and Construction Company, Inc. In Septem-

ber, 1980, Madero Development filed an application with

the City for preliminary approval of a 1.8 acre subdivi-

sion to be built on the same tract of land, now known as

“Madero Hills”. Madero Development also requested a

change of zoning from the City Plan Commission. The

Commission deferred decision on the subdivision appli-

cation and requested that Madero submit a master plan

for the ‘entire Madero Hills development. The Commis-

sion also denied the request of Madero Development for

a zoning change from R-3/R-4 (high density residential)

to SD (a special zoning category), recommending instead

that Madero Hills be rezoned RMD (residential mountain

district), a zoning classification that severely limited

development. In December, 1984, the El Paso City Council

passed an ordinance amending the RMD ordinance and

changing its name to PMD (planned mountain district), a

zoning classification with similarly strict limitations on

development. In January, 1986, the City Council rezoned

the Madero Hills property from R-3/R-4 to PMD. Under

PMD zoning, the allowable density of development on a

tract of land is tied to its percentage of slope. According

to the City’s method of calculation, the Madero Hills

property had a slope of forty-eight percent. Therefore,

under this zoning classification only twelve units could

be built on the property, compared with 179 units under

the previous R-3/R-4 zoning classification. The Plaintiffs

have not sought a variance or special exception from the

City Plan Commission or the Zoning Board of Adijust-

ment to enable the property to be developed as previ-

ously planned, nor has either Plaintiff formally requested

that the City Plan Commission or the City Council rezone

3-a

the property. Instead, they brought this action claiming

thai the Defendants have taken their property without

just compensation and have denied them due process of

law and equal protection of the law. They have filed a

motion for summary judgment with respect to these

claims. The Defendants have filed a motion for leave to

file an amended answer, which the Plaintiffs oppose. The

Defendants also seek summary judgment in their favor,

contending that (1) Plaintiffs’ claims are not ripe for

review in federal court; (2) that the Plaintiffs lack stand-

ing to protest the City’s zoning of the property, and (3)

that even if the question were ripe and the Plaintiffs did

have standing, they have not shown that the City’s action

constitutes a deprivation of their constitutional rights.

The Defendants’ answer was filed on December 22,

1986. Paragraph 4 of that original answer read in its

entirety as follows:

Defendants [sic] admit the first sentence of para-

graph Four of County I of Plaintiffs’ Original

Petition.! Defendants admit the remaining alle-

gations of paragraph Four of Count I! of Plain-

tiffs’ Original Petition.

The Defendants claim that the second “admit” in this

paragraph was a clerical error; it should have read

“denied”. They move to amend the answer to clear this

up. The Court finds that leave to amend should be

granted. It is well settled that leave to amend pleadings

should be “freely given when justice so requires”. Rule

! The Plaintiffs labeled their pleading a “Petition” instead

of a complaint as prescribed by Rule 3, Federal Rules of Civil

Procedure.

4-a

15(a), Federal Rules of Civil Procedure. It is obvious from

the history of this case that the “admission” was a clerical

error which did not reflect the position of the Defendants.

Furthermore, it must have been obvious to the Plaintiffs

from the beginning that the Defendants’ “admission” was

unintentional. The parties pursued extensive discovery

for over a year, and no one could have doubted that the

merits of this case were being hotly contested, nor have

believed that the Defendants intended to concede that

their zoning action was “an arbitrary, unreasonable,

exclusionary, and illegal act by the municipality” (Plain-

tiffs’ Original Petition, paragraph Four, page 3). Further-

more, the parties have filed a joint pretrial order which

was approved by the Court. The pretrial order clearly sets

forth the Defendants’ denial that the City’s zoning

actions on the Madero Hills property violated any of

Plaintiffs, constitutional rights. A properly approved pre-

trial order supersedes all previous pleadings in the case.

Defendants’ motion for leave to amend should be

granted, therefore, because it would bring the pleadings

in line with the parties’ common understanding of the

contested issues in the case.

The Defendants have moved for summary judgment

in their favor with respect to the Plaintiffs’ claims under

Section 1983, contending that the case is not ripe for

review because the Plaintiffs have failed to obtain a final

decision on the zoning in question. Of course, the exhaus-

tion of administrative remedies is not a prerequisite to a

suit under Section 1983. Patsy v. Florida Board of Regents,

457 U.S. 496 (1982). Nevertheless, an administrative

action must be final before it is judicially reviewable.

-5-a

Williamson County Regional Planning Commission v. Ham-

ilton Bank of Johnson City, 473 U.S. 172, 193 (1985). An

action is not “final” unless the decisionmaker has arrived

at a definitive position on the issue that inflicts an actual,

concrete injury. Williamson County Regional Planning Com-

mission v. Hamilton Bank of Johnson City, supra at 193-94.

Furthermore, when a party alleges that his property has

been taken without just compensation in violation of the

Fifth and Fourteenth Amendments, he must show that he

has pursued the recovery of just compensation in the

state courts and that recovery has been denied. Wil-

liamson County Regional Planning Commission v. Hamilton

Bank of Johnson City, supra, at 195-96. The Constitution

does not require that taking and compensation be simul-

taneous; it only requires a reasonable, certain and ade-

quate provision for obtaining compensation. Williamson

County Regional Planning Commission v. Hamilton Bank of

Johnson City, supra at 195; Regional Rail Reorganization Act

cases, 419 U.S. 102, 124-25 (1974); Cherokee Nation v. South-

ern Kansas Railroad Co., 135 U.S. 641, 659 (1890). Like the

instant case, Williamson County involved claims under

both the Due Process Clause and the Just Compensation

Clause, and the Supreme Court held that both were pre-

mature.

Plaintiffs argue that the instant case is distinguish-

able from Williamson County, because that holding was

dependent upon the existence of procedures under state

and local law for seeking an exemption from the zoning

ordinance. They contend that the Defendants in this case

have failed to show the availability of variances or special

exemptions which would provide relief from the density

restrictions of the PMD zoning. With respect to the claim

6-a

under the Just Compensation Clause, the Plaintiffs deny

the existence of an “inverse condemnation” action in

Texas comparable to the one in Tennessee upon which the

Supreme Court relied.

With respect to the finality question, it is unclear

under Texas law as to whether the Madero Hills zoning

decision is “final”. Under the El Paso City Code, the

Zoning Board of Adjustment has authority to hear

appeals and applications for variances and special excep-

tions. El Paso City Code, § 20.04.050. Furthermore, the City

Code provides that “the board shall have the powers

granted by, and be controlled by, Article 1101g, Rev. Civ.

Stat. of Texas, as amended.” The statute to which the City

Code refers has been codified in the Texas Local Govern-

ment Code. It provides in pertinent part:

The governing body [the City Council] may

authorize the Board of Adjustment, in appropri-

ate cases and subject to appropriate conditions

and safeguards, to make special exceptions to

the terms of the zoning ordinance that are con-

sistent with the general purpose and intent of

the ordinance and in accordance with any appli-

cable rules contained in the ordinance.

Texas Local Government Code, § 211.008(a) (Vernon

1988). Boards of adjustment are also empowered to grant

variances from the terms of zoning ordinances:

[I]f the ordinance is not contrary to the public

interest, and due to a special condition, a literal

enforcement of the ordinance would result in

unnecessary hardship, and so that the spirit of

the ordinance is observed and substantial justice

is done.

7-a

Texas Local Government Code, § 211.009(3) (Vernon

1988). Furthermore, the Code provides that a decision of

the Zoning Board of Adjustment may be reviewed by a

state district court. In the instant case, there is no indica-

tion that the Plaintiffs have sought a variance from the

Zoning Board of Adjustment, the City Plan Commission,

or the City Council. Although the Plaintiffs suggest that

such a request would have been futile, they have cited no

case law in support of a “futility” exception to the ripe-

ness and finality requirement imposed by the Supreme

Court.

Even if the availability of relief from the Zoning

Board of Adjustment is uncertain, the Plaintiffs clearly

had the right to seek relief in state court. Texas law

recognizes a judicial remedy for a property owner

aggrieved by an arbitrary and unreasonable zoning

action by a city. Hunt v. City of San Antonio, 462 S.W.2d

536, 539 (Tex. 1971); City of Austin v. Nelson, 45 S.W.2d 692

(Tex. Civ. App. - Austin 1931, no writ). Property owners

also have recourse to the Texas courts if a zoning board of

adjustment arbitrarily grants or de ies variances that

restrict the use of or affect their prop ty. Board of Adjust-

ment v. Willie, 511 S.W.2d 591 (Tex.Civ.App. - San Antonio

1974, writ ref’d n.r.e.); Swain v. Board of Adjustment of the

City of University Park, 433 S.W.2d 727 (Tex.Civ.App. -

Dallas 1968, writ dsm’d w.o.j.), cert denied, 396 U.S. 277

(1970).

The Plaintiffs challenge the continuing viability of

the Williamson County ripeness requirement in light of the

Supreme Court decision in First English Evangelical

Lutheran Church of Glendale v. County of Los Angeles,

8-a

___ US. __, 107 S.Ct. 2378 (1987). The Court finds that

holding not inconsistent with Williamson County. In First

English Evangelical Lutheran Church, the plaintiff had

alleged a taking without just compensation and had filed

suit in California state court. The matter had been liti-

gated all the way to the Supreme Court of California, and

came to the United States Supreme Court by means of

direct appeal. Surely the ripeness requirement was satis-

fied in that case, whereas in the instant case it has not

been satisfied. The Plaintiffs must take their grievance to

state court and seek just compensation for the alleged

“taking” before bringing suit in this Court under Section

1983.

Finally, the Plaintiffs have failed to state a claim for

relief under 42 U.S.C. § 1985(3). The statute now codified

as 42 U.S.C. § 1985(3) was originally enacted by Congress

as part of the Ku Klux Klan Act of 1871. Its purpose was

to protect emancipated blacks and their supporters from

conspiracies to deprive them of their civil rights. United

Brotherhood of Carpenters and Joiners v. Scott, 463 U.S. 825,

835-37 (1983). In order to state a claim under Section

1985(3), the plaintiff's complaint must allege a conspiracy

motivated by race-based invidiously discriminatory

animus. United Brotherhood of Carpenters and Joiners v.

Scott, supra; Griffin v. Breckenridge, 403 U.S. 88 (1971). No

such allegations are made in the instant case, and no

claim under Section 1985(3) has been stated.

In light of the foregoing discussion, the following

orders should be entered.

It is ORDERED that the Defendants’ motion for leave

to file and amended answer in the above-styled and

9-a

numbered cause be, and it is hereby, GRANTED. The

District Clerk is directed to file the first amended answer.

It is further ORDERED that the Defendants’ motion

for summary judgment be, and it is hereby, GRANTED.

It is further ORDERED that the Plaintiffs’ claim for

relief under 42 U.S.C. § 1983 be, and it is hereby, DIS-

MISSED without prejudice.

It is further ORDERED that the Plaintiffs’ claim

under 42 U.S.C. § 1985(3) be, and it is hereby, DISMISSED

with prejudice.

SIGNED AND ENTERED this 21st day of December,

1988.

/s/ Harry Lee Hudspeth

HARRY LEE HUDSPETH

UNITED STATES DISTRICT

JUDGE