City of Houston v. James & Elizabeth Carlson, 451 S.W.3d 828

Park Memorial: 108-unit condominium in Houston with reported structural, electrical, and plumbing defects; one owner notified city in 2008 prompting investigation.
City inspectors found code violations and, citing immediate hazards (esp. possible underground parking failure), posted notices and ordered residents to vacate after owners did not obtain occupancy certificates or make repairs.
Owners sought administrative review; the city upheld the vacate order and residents left. Later a district court found due-process violations and enjoined the vacate order; the order was reversed on procedural grounds in Carlson (no further review by the Court here) and the property was ultimately sold for redevelopment.
Sixteen condominium owners then sued the City in an inverse-condemnation action seeking compensation for lost use and other damages, alleging a regulatory taking arising from the vacate order.
The trial court sustained the City’s plea to the jurisdiction (dismissing for lack of a takings claim); the court of appeals reversed; the Texas Supreme Court granted review and reinstated dismissal for lack of jurisdiction.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether plaintiffs alleged a taking under inverse-condemnation law	The vacate order deprived owners of use and was tantamount to a regulatory taking requiring compensation	The vacate order was a civil-enforcement action and not a taking; absent a taking the City retains immunity	No — plaintiffs did not plead a taking; dismissal for lack of jurisdiction
Whether procedural defects in enforcement can alone constitute a regulatory taking	Due-process failures and the manner of enforcement converted the enforcement into a taking	Procedural infirmities do not convert a valid regulatory regime into a taking	No — procedural-only challenges do not state a takings claim
Whether plaintiffs challenged the underlying land-use regulations	Plaintiffs argued the enforcement and penalty were excessive and misapplied (but did not challenge the code standards themselves)	The City noted plaintiffs did not contest the substance of building-code requirements	Court: Plaintiffs never challenged the substantive restrictions; absence of such challenge defeats a regulatory-takings claim
Whether government immunity is waived absent a properly pled takings claim	Plaintiffs: waiver applies because they sought just compensation via inverse condemnation	City: waiver does not apply because no taking was pled	Court: Immunity remains; waiver applies only when a valid takings claim is pleaded

Reata Constr. Corp. v. City of Dallas, 197 S.W.3d 371 (Tex. 2006) (municipal immunity principles and jurisdictional limits)
City of Dallas v. VSC, LLC, 347 S.W.3d 231 (Tex. 2011) (Texas Constitution waives immunity for inverse-condemnation claims)
Hearts Bluff Game Ranch, Inc. v. State, 381 S.W.3d 468 (Tex. 2012) (requirement that takings claim be properly pled for waiver to apply)
Lingle v. Chevron U.S.A. Inc., 544 U.S. 528 (2005) (regulatory-takings standard and distinction between due process and takings analyses)
Penn Cent. Transp. Co. v. City of New York, 438 U.S. 104 (1978) (land-use regulations and takings framework)
Penn. Coal Co. v. Mahon, 260 U.S. 393 (1922) (recognition of regulatory takings where regulation goes too far)
Mayhew v. Town of Sunnyvale, 964 S.W.2d 922 (Tex. 1998) (takings can be physical or regulatory)
City of Abilene v. Burk Royalty Co., 470 S.W.2d 643 (Tex. 1971) (elements of inverse-condemnation; intent requirement)