KEY ENERGY SERVICES, LLC, Appellant v. SHELBY COUNTY APPRAISAL DISTRICT, Appellee
428 S.W.3d 133
| Tex. App. | 2014Background
- Key Energy Services, LLC appeals SCAD valuations of two saltwater disposal wells (Davis #3 and Davis #5) in Shelby County, Texas.
- Davis Vacuum Services purchased the tract with the wells in 2007; Key later merged with Davis and leases Davis #3 from Leggett for land on which it sits.
- Valuations rose dramatically in 2007; Key protested 2007–2010 protests, which the appraisal review board denied; Key filed suit for trial de novo, later nonsuiting the board.
- Key sought declaratory relief claiming protests were timely and appraisals/roll entries for 2007–2010 void for misdescriptions; SCAD sought a ruling that wells are real property and subject to tax.
- Trial court denied Key’s requests, declined to change 2007 valuation due to lack of jurisdiction, and ordered each party to bear its own costs; no findings of fact or conclusions of law were filed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Jurisdiction over 2007 tax year claims | Key contends 31.04(a-1) tolls jurisdiction for timely protest and payment. | SCAD asserts 31.04(a-1) not applicable; this is a supplemental appraisal, not omitted property. | No jurisdiction under 31.04(a-1); Section 31.04(a) applies. |
| Whether SCAD correctly categorized the property as an estate or interest in land | SCAD impermissibly commingled real and personal property; miscategorized. | Wells comprise a real property interest (estate or right to inject) with related personal property; proper categorization supported. | SCAD properly categorized as estate or interest in land; no voiding of appraisals. |
| admissibility of expert testimony from Kret | Kret lacks relevant expertise; methodology flawed; commingles real/personal property. | Kret’s testimony is admissible; his income approach and methodology are reliable and properly grounded in Tex. Tax Code. | Kret’s testimony admitted; no abuse of discretion. |
| Whether trial court erred in refusing to reduce valuations | Kret overstated value; Cobb’s testimony supports lower value; valuation should reflect ad valorem value of property. | SCAD’s mixed-method approach is appropriate; valuation supported by income/cost methods; Cobb’s attack insufficient to overturn. | No reduction; valuation sustained. |
| Findings of fact and conclusions of law | Timely requests for findings were filed; judge’s failure to respond caused prejudice. | No timely request; no reversible error; record shows basis for ruling. | No error; findings not required given timing; no harm shown. |
Key Cases Cited
- Tex. Ass’n of Bus. v. Tex. Air Control Bd., 852 S.W.2d 440 (Tex. 1993) (subject-matter jurisdiction is essential; de novo review)
- Cameron Appraisal Dist. v. Rourk, 194 S.W.3d 501 (Tex. 2006) (exhaustion of administrative remedies; jurisdictional prerequisites)
- Anderton v. Rockwall Cent. Appraisal Dist., 26 S.W.3d 539 (Tex. App.–Dallas 2000) (time to protest; fixed appraisal rolls; 25.25 provisions)
- Coastal Liquids Partners, L.P. v. Coastal Liquids, 165 S.W.3d 329 (Tex. 2005) (real property categories; separate appraisal considerations)
- Gregg County Appraisal Dist. v. Laidlaw Waste Systems, Inc., 907 S.W.2d 12 (Tex. App.–Tyler 1995) (excludes going-concern factors; appraisal reports must identify components)
- City of Keller v. Wilson, 168 S.W.3d 802 (Tex. 2005) (court may deem testimony reliable; credibility and weight go to fact-finder)
- Dow Chem. Co. v. Francis, 46 S.W.3d 237 (Tex. 2001) (standard for reviewing legal sufficiency of evidence)
- Texas v. Ar. v. Robinson, 923 S.W.2d 549 (Tex. 1995) (abuse of discretion standard for evidentiary rulings)