Thank you for sharing!

Your article was successfully shared with the contacts you provided.
Click here for the full text of this decision FACTS:The city of Carrollton acquired a strip of land from Hebron Baptist Church as part of a street widening and reconstruction. Benefit Realty, which had a right of first refusal on the church’s property, sued the city, saying it was due compensation for the city’s taking. Benefit asserted claims of conversion, common-law fraud, tortious interference with contractual relations, civil conspiracy and tortious interference with prospective contracts. The trial court granted the city’s plea to the jurisdiction based on sovereign immunity. HOLDING:Affirmed. The court first examines whether Benefit’s claims could be brought under the Tort Claims Act. Benefit claims the city’s action was proprietary and not subject to the TCA. The city says its action was governmental. The TCA specifically lists “street construction and design” as a governmental function, and also says that proprietary functions “do not include” functions listed in the same section where street construction is discussed. Although the city entered into an agreement with the church to acquire the land rather than going through the condemnation process, the court still finds the agreement arose out of the city’s plans for street construction and design. Under the TCA, when the government is engaged in a governmental function, its immunity is not waived for claims arising out of intentional torts. Thus, the city is immune from Benefit Realty’s intentional torts. Moreover, Benefit Realty makes no argument that its negligence-based tort claims fit within any specific waiver of immunity under the TCA. The court next examines whether Benefit’s claim could be brought as an inverse condemnation case, again, where immunity would be waived. If Benefit’s property has been taken, damaged or destroyed for a public use without adequate compensation, Benefit will have stated a claim under the Texas constitution. The court finds no Texas cases on point over whether a party with a right of first refusal can make an inverse condemnation claim. The court eventually agrees with the city that no “taking” of Benefit’s right has occurred. The court relies on a California case, noting that, “[t]he purpose of condemnation is to ensure that public entities obtain land needed for public purposes to benefit the community. Public entities have the right and the duty to act swiftly in condemnation proceedings for the public health, safety, and welfare. And land is not fungible. Public entities may not simply go to another vendor for the same or similar widgets such as paper clips. The Legislature has provided that if a public entity is forced into eminent domain litigation, it should settle with as many owners as swiftly as possible to minimize the costs, uncertainties and time to obtain such needed land. Private holders of rights of first refusal may not thwart such public purposes by forcing the owner or the subsequent public entity to sell it to them.” Because the church’s sale of the city was involuntary, Benefit’s right of first refusal did not apply, and there was no taking from Benefit. OPINION:Whittington, J.; Morris and Whittington, JJ.

Want to continue reading?
Become a Free ALM Digital Reader.

Benefits of a Digital Membership:

  • Free access to 1 article* every 30 days
  • Access to the entire ALM network of websites
  • Unlimited access to the ALM suite of newsletters
  • Build custom alerts on any search topic of your choosing
  • Search by a wide range of topics

*May exclude premium content
Already have an account?


ALM Legal Publication Newsletters

Sign Up Today and Never Miss Another Story.

As part of your digital membership, you can sign up for an unlimited number of a wide range of complimentary newsletters. Visit your My Account page to make your selections. Get the timely legal news and critical analysis you cannot afford to miss. Tailored just for you. In your inbox. Every day.

Copyright © 2021 ALM Media Properties, LLC. All Rights Reserved.