Stanley Works v. Wichita Falls Independent School District
366 S.W.3d 816
| Tex. App. | 2012Background
- Stanley Works d/b/a Stanley Mechanics Tools entered into a Tax Abatement Agreement with Wichita County in 1994, with Wichita Falls ISD (WFISD) later joining in 1994, to relocate and expand equipment and processes at Stanley's Wichita Falls facility.
- Exhibit B described three phases: Phase I (1994) manufacturing Mac tools; Phase II (1995) closing Ohio facility and expanding Texas operations; Phase III (1994) major investment in process equipment to increase capacity.
- Wichita County approved declining ad valorem tax abatements for Phase I and III from 1995-2005 and for Phase II from 1996-2006; Wichita Appraisal District administered the abatement and Stanley had annual reporting duties.
- The Agreement required Stanley to perform certain personal property additions/improvements; failure to do so triggered repayment of lost tax revenue attributable to the relevant Phase, but one Phase's failure did not affect other Phases' abatements.
- From 1994-2001 Stanley made substantial personal property additions totaling about $3.32 million; after 2001, Stanley stopped making additions and moved operations out of Wichita County in 2002.
- WFISD and Wichita County abated about $220,087.54 in taxes from 1995-2001; WFISD later sued in 2006 for damages for asserted breaches of the Phase obligations.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether §33.05(a)(1) limits the suit | Stanley argues limitations apply because taxes were delinquent more than four years prior. | WFISD contends §33.05(a)(1) applies only to suits to collect delinquent taxes, not breach damages. | Section 33.05 does not apply; the suit is for breach, not delinquent taxes. |
| Whether laches bars WFISD's claim | Stanley asserts unreasonable delay prejudiced defense and impaired witnesses. | WFISD contends laches requires proof of prejudice and a good-faith, detrimental change due to delay. | Stanley failed to prove requisite elements; laches does not bar the claim. |
| Whether WFISD is barred by quasi-estoppel | Stanley asserts quasi-estoppel prevents WFISD from asserting inconsistent positions. | WFISD argues Stanley did not properly plead or prove quasi-estoppel. | Issue waived for lack of proper pleading/ findings; quasi-estoppel not upheld. |
| Whether the Tax Abatement Agreement is divisible or indivisible | Stanley contends the contract is divisible by Phases I–III, each with separate obligations. | WFISD contends the contract is indivisible. | Contract is divisible; Section 4.4 allows Phase-specific recovery for failed Phases. |
| Amount of recovery and sufficiency of evidence by Phase | WFISD seeks lost tax revenue attributable to all relevant Phases; evidence should allocate Phase I-III losses. | Evidence does not separately attribute Phase I losses from Phase III; Phase II losses are clearly itemized. | Recovery limited to Phase I and II losses; Phase I/III split not separable; damages for I–II supported, Phase III non-recoverable for this claim. |
Key Cases Cited
- BMC Software Belgium, N.V. v. Marchand, 83 S.W.3d 789 (Tex. 2002) (legal conclusions reviewed de novo; sufficiency standards)
- City of Keller v. Wilson, 168 S.W.3d 802 (Tex. 2005) (no-evidence review; sufficiency standards)
- Italian Cowboy Partners, Ltd. v. Prudential Insurance Co. of America, 341 S.W.3d 323 (Tex. 2011) (contract interpretation; ambiguity; extrinsic evidence)
- J.M. Davidson, Inc. v. Webster, 128 S.W.3d 223 (Tex. 2003) (contract interpretation and intention of parties)
- Pearson v. American Fidelity & Casualty Co., 321 S.W.2d 620 (Tex. App.-Amarillo 1959) (laches involves prejudice from delay)