Stephen Morale D/B/A Action Collision Repair and Kimberly Morale v. State, 557 S.W.3d 569

State condemned a 3,200 sq ft strip of a 33,000 sq ft commercial parcel owned by Stephen and Kimberly Morale, affecting an 8,831 sq ft collision-repair facility and a metal canopy.
State appraiser Ayers initially classified the Morales as “displaced” (May 2012), but after a new cure plan by State land planner O’Connor she revised her appraisal and the State revoked displacement (Nov 2013).
Morales retained appraiser David Bolton and planner Bill Carson; Bolton offered two valuations: a "displaced" valuation (~$1,262,947) assuming demolition, and a nondisplaced valuation (~$1,064,335) assuming a cure plan and zoning relief.
Zoning: the property’s existing collision-repair use was legally nonconforming; continuation post-taking depended on obtaining variances/approvals from the Town. Key testimony from town officials conflicted on the likelihood of such approvals.
Trial court admitted evidence about displacement and Bolton’s alternative valuations, excluded testimony from two town officials about prior variance practice; jury awarded $1,064,335 (Bolton’s nondisplacement value). Court of appeals reversed; Supreme Court of Texas reversed the court of appeals and reinstated the trial judgment.

Issue	Plaintiff's Argument (Morale)	Defendant's Argument (State)	Held
Admissibility of evidence about the State’s initial displacement classification	Displacement classification and related testimony are probative of highest-and-best-use and market value after taking	Classification was irrelevant after revocation and prejudicial	Admissible — classification was relevant to highest-and-best-use and probative of valuation and State motives
Admissibility of Bolton’s displacement valuation (opining demolition and higher damages)	Bolton’s displaced valuation reasonably assumed facts supported by evidence (Morales’ testimony and initial displacement classification)	Valuation was speculative because demolition and relocation were not shown to be certain	Admissible — not so speculative as to be excluded; assumptions could be tested by cross-examination
Exclusion of town officials’ testimony about prior zoning variances for other properties	Prior variance practice tends to show the Town would or would likely grant variance for Morales’ cure plan	Testimony was speculative and not specific to Morales’ property	Exclusion not an abuse of discretion — testimony too speculative and not specific to the parcel; if error, it was harmless because similar evidence was before the jury
Standard of review for trial court evidentiary rulings	N/A (procedural position)	N/A	Trial court’s evidentiary rulings reviewed for abuse of discretion; no abuse found

Owens-Corning Fiberglas Corp. v. Malone, 972 S.W.2d 35 (Tex. 1998) (trial court’s evidentiary rulings reviewed for abuse of discretion)
Enbridge Pipelines (E. Tex.) L.P. v. Avinger Timber, LLC, 386 S.W.3d 256 (Tex. 2012) (highest-and-best-use presumed to be existing use)
State v. Petropoulos, 346 S.W.3d 525 (Tex. 2011) (measure of just compensation in partial takings)
State v. Schmidt, 867 S.W.2d 769 (Tex. 1993) (expert condemnation testimony inadmissible when based on remote, speculative uses)
City of Austin v. Whittington, 384 S.W.3d 766 (Tex. 2012) (owner may challenge condemnor’s classifications by proving fraud, bad faith, or arbitrariness)
Horizon Health Corp. v. Acadia Healthcare Co., 520 S.W.3d 848 (Tex. 2017) (an expert may assume facts established by legally sufficient evidence)
Burroughs Wellcome Co. v. Crye, 907 S.W.2d 497 (Tex. 1995) (same principle regarding assumed facts for expert testimony)
Moore Outdoor Props., L.P. v. State, 416 S.W.3d 237 (Tex. App.—El Paso 2013) (market-value testimony should reflect willing buyer–willing seller assumptions)
Caffe Ribs, Inc. v. State, 487 S.W.3d 137 (Tex. 2016) (erroneous exclusion of evidence is reversible only if it probably resulted in an improper judgment)
Cannizzo v. City of Austin, 267 S.W.2d 808 (Tex. 1954) (willing-seller/willing-buyer market-value framework)