Fed. Dist Court of TX Holds Takings Claims Were Unripe

This post was authored by Matthew Loescher, Esq.

Plaintiffs Joe Murphy, Yoram Ben-Amram, and Galtex Development, LLC sued the City of Galveston in 2012, claiming that the City took their property without just compensation in violation of the Texas and United States Constitutions. The case began in state court, was removed to federal court, remanded to state court where it bounced between the state district court and the state appellate courts for a number of years, and returned to federal court in this case.

The City contended the court lacked subject matter jurisdiction over the case because Plaintiffs’ takings claims under the United States Constitution were not ripe for adjudication. The record reflected that the City never reached an official and final decision as to whether it would issue an SUP to Plaintiffs. At the time City Council initially voted down the SUP application, City officials pointed out numerous issues they had with the property that Plaintiffs could have resolved before reapplying for the SUP. Thus, the transcript of the City Council hearing indicated that City officials encouraged Ben-Amram to bring the property up to code, acquire the engineer’s letter, and then reapply for the SUP. Moreover, City Council members stated that they were denying the SUP over concerns about the safety of the building and the health of its future occupants, thereby suggesting that an SUP would be granted were it not for those concerns. After the City rejected the SUP application, however, Plaintiffs brought this lawsuit instead of bringing the property into compliance with applicable code and then resubmitting an SUP application reflecting completion of the repairs.

 Lastly, Plaintiffs claimed the City Code Enforcement Officer’s revocation of the property’s grandfather status amounted to an unlawful taking under the Fifth Amendment. Specifically, Plaintiffs posited that they should be excused from filing an appeal to the Board on the grandfather status issue because that effort would have been futile. The court found that Plaintiffs’ argument was founded solely on speculation, and therefore rejected it. Accordingly, Plaintiffs’ takings claim for the loss of grandfather status was not ripe, and was dismissed on that basis.

 Murphy v City of Galveston, TX, 2021 WL 1220204 (SD TX 3/31/2021)