Barshop v. City of Houston
12 Tex. Sup. Ct. J. 487, 1969 Tex. LEXIS 247, 442 S.W.2d 682 (1969)
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Rule of Law:
In an eminent domain proceeding, a landowner is entitled to have the condemned property's market value calculated inclusive of any value enhancement caused by the public project itself, up until the point the government manifests a definite purpose to take that specific parcel of land. Prolonged uncertainty regarding whether a property will be acquired for a project allows the owner to benefit from the enhanced value that accrues during the period of uncertainty.
Facts:
- Beginning in 1950, the City of Houston initiated studies for a new airport.
- In 1957, Houston agreed to purchase a 3,125-acre tract from Jetero Ranch Company for the new airport, though it was generally known this tract was not large enough for the entire project.
- Joe Barshop's 52.66-acre tract was not part of this initial purchase but was located on its edge, beneath a planned runway's flight path.
- The property's value increased due to the airport project, leading to its sale to Select Homes for $79,000 in 1959 and then to Barshop for $90,000 on April 20, 1960.
- On October 11, 1960, Houston passed an ordinance authorizing an offer of $63,192 to Barshop, but the city did not communicate this offer for another 32 months.
- A subsequent ordinance in October 1960 designated a larger area that included Barshop's tract but did not commit the city to acquiring all the land within it, creating continued uncertainty.
- A Master Plan adopted on October 23, 1961, formally included the Barshop tract within the airport's boundaries.
- Throughout the years between the initial airport announcement and the eventual taking, there was a continuing state of uncertainty as to whether Houston would actually condemn Barshop's property.
Procedural Posture:
- The City of Houston filed a condemnation suit against Joe Barshop in the trial court to acquire his property.
- At trial, the court admitted evidence of the property's market value, including value enhancement caused by the airport project, over Houston's objections.
- The jury returned a verdict finding the market value of the tract to be $168,512.00, and the trial court entered judgment for that amount.
- The City of Houston, as appellant, appealed the decision to the court of civil appeals (an intermediate appellate court).
- The court of civil appeals reversed the trial court's judgment, holding that value enhanced after October 11, 1960, should have been excluded, and it remanded the case for a new trial.
- Joe Barshop, as petitioner, then appealed to the Supreme Court of Texas (the state's highest court) for review.
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Issue:
In a condemnation proceeding, does a property owner have the right to include the enhancement in their property's market value caused by the public project itself, when there was a long period of uncertainty as to whether their specific tract would be acquired for the project?
Opinions:
Majority - Pope, Justice
Yes, a property owner is entitled to the enhanced market value under these circumstances. The general rule is that any enhancement in value occasioned by the public facility itself should be excluded from a condemnation award. However, an exception applies when the exact location or extent of the project is uncertain for a significant period. Citing City of Dallas v. Shackelford, this court holds that valuation properly includes enhanced value up to the time the government manifests a definite purpose to take the specific land. Given the fourteen years of public discussion and the prolonged, continuing uncertainty about whether Barshop's particular tract would be taken, Houston had not manifested a definite purpose to take it until much later. Therefore, the trial court was correct to allow the jury to consider the enhanced value, and Houston's request to exclude all enhancement evidence was properly denied.
Analysis:
This case refines the 'scope of the project' rule in Texas eminent domain law, establishing that government indecision or prolonged uncertainty about which specific parcels will be taken for a public project can benefit landowners. It prevents the government from depressing property values by announcing a project long before it commits to specific acquisitions. The decision solidifies the principle that fair market value must be determined at the date of taking and can include project-induced appreciation until the government makes a 'definite purpose to take' clear, thereby protecting property owners from bearing the financial cost of governmental delay.
