397 S.W.3d 162 | Tex. | 2013
Lead Opinion
delivered the opinion of the Court.
Texas legal rules governing real-estate transactions demand assiduousness, lest
1. 2003 Judgment — which the Texas Department of Transportation (TxDOT) and the City of Edinburg claim gives the City fee-simple ownership, subject to a drainage easement granted to TxDOT.
2. 200k Judgment — which A.P.I. Pipe Supply, LLC and Paisano Service Company, Inc. (collectively API) claim gives API fee-simple ownership, subject to a drainage easement granted to the City (and, via subsequent conveyance, to TxDOT).
In 2005, TxDOT began its drainage project, and API, relying on the 2004 Judgment, brought a takings claim for the value of the removed soil. TxDOT counters that API lacks any ownership interest because the 2004 Judgment, which purports to declare the 2003 Judgment “hull and void,” is itself void — to which API replies, even if the 2003 Judgment controls, API is an “innocent purchaser” entitled to ownership under Property Code section 13.001.
We agree with TxDOT. The void 2004 Judgment cannot supersede, the valid 2003 Judgment; API is statutorily ineligible for “innocent purchaser” status; and equitable estoppel is inapplicable against the government in this case. Because API’s takings claim fails, we reverse the court of appeals’ judgment and dismiss the suit.
I. Facts
The chain of title contains conflicting récords, so we first describe how the City, TxDOT, and API obtained their purported interests in the land.
A. The 2003 Judgment Giving the City Ownership
Herschell White originally owned the land, and the City brought a condemnation action so it could dig a drainage channel. As compensation for the land, the commissioners awarded, and White accepted, $207,249 (plus $17,000 for damage to- the remainder of the property). The special commissioners’ report described the interest conveyed as a “right-of-way” but also incorporated by reference the City’s original petition for condemnation, which described the interest sought as a “fee .title.” No one objected to the special commissioners’ award, and the trial court adopted it as the judgment of the court (the 2003 Judgment).
B. The 2004 Judgment Nunc Pro Tunc Giving API Ownership
A year later, the same trial court entered a “Judgment Nunc Pro Tunc” (the' 2004 judgment), which was agreed to by the City’s and White’s attorneys. A TxDOT employee apparently also approved the 2004 Judgment by email.
The 2004 Judgment purported to render the 2003 Judgment “null and void.” The 2004 Judgment states that the City’s interest in the land was a “right of way easement” obtained “for the purpose of opening, constructing. and maintaining a permanent channel or drainage ease
C. Subsequent Title Transfers
Three months after the trial court signed the 2004 Judgment, White sold the ten acres and some surrounding property to API.
II. Proceedings Below
When TxDOT started digging, API filed an inverse-condemnation action against the City and TxDOT over the removed dirt. TxDOT and the City filed a plea to the jurisdiction, which the trial court denied. The court of appeals affirmed, holding the 2004 Judgment was void but saying the record was unclear as to whether API had notice of the 2003 Judgment.
Upon remand to the trial court, TxDOT and the City produced evidence that the 2003 Judgment was indeed recorded in the county registry. TxDOT and the City filed a second plea to the jurisdiction, arguing that, because the 2004 Judgment was void and API had notice of the 2003 Judgment, the City held fee-simple title to the land, subject only to TxDOT’s easement. The trial court denied the second plea to the jurisdiction, and the court of appeals affirmed, concluding that API was a good-faith purchaser for value since the 2004 Judgment superseded the 2003 Judgment.
III. Discussion
Whether a court has jurisdiction is a matter of law we decide de novo.
A trial court lacks jurisdiction and should grant a plea to the jurisdiction where a plaintiff “cannot establish a viable takings claim.”
For the reasons discussed below, we hold that API does not own the land and cannot assert the good-faith purchaser
A. The 2004 Judgment in Favor of the City Was Void.
A judgment nunc pro tunc can correct a clerical error in the original judgment, but not a judicial one.
Here, the change was undeniably significant. The 2003 Judgment granted a fee simple to the City, while the 2004 Judgment purported to turn the City’s outright ownership into a mere easement. Again, the fact that the change was significant is not fatal to the 2004 Judgment’s nunc pro tunc status. However, TxDOT and the City produced evidence showing that the 2003 Judgment correctly reflected the underlying judicial determination,
Further, the trial court in this case was by law required to adopt the award of the special commissioners, who in turn granted the fee-simple title the City sought in its condemnation petition. If parties do not timely object to a special commissioners’ report, the trial court is required to enter “the [special] commissioners’ findings as the judgment of the court.”
One more timing issue cuts against API: the expiration of the trial court’s plenary power. Such power usually lasts 30 days.
Because the 2004 Judgment was void, it did not convey anything to anyone. Instead, under the 2003 Judgment, the City continued to hold fee-simple title. White continued to have no interest in the land, and API could not buy from White what White did not own.
B. The Innocent-Purchaser and Equitable Estoppel Doctrines Are Inapplicable.
API urges that, even if the 2004 Judgment is void such that White had no interest to convey, API should still prevail because it depended on the 2004 Judgment when it bought the land from White. API presents two theories, neither persuasive.
1. The Innocent-Purchaser Statute, by its Terms, Does not Apply to Recorded Judgments.
The court of appeals held that API was a good-faith purchaser for value. However, we refused the writ of error in a case holding that this doctrine does not protect a purchaser whose chain of title includes a void deed: “One holding under a void title cannot claim protection as an innocent purchaser.”
Codified at Property Code section 13.001, the innocent-purchaser doctrine is simply inapplicable here:
A conveyance of real property or an interest in real property ... is void as to ... a subsequent purchaser for a valuable consideration without notice unless the instrument has been ... proved and filed for record as required by law.23
By its terms, the statute protects purchasers from unrecorded property conveyances — covert, off-the-books transfers that leave buyers unaware of adverse interests. But one cannot be “innocent” of a recorded judgment, and here, API concedes it knew of the recorded 2003 Judgment before it purchased the property.
API essentially argues that the 2003 Judgment was superseded by the 2004 Judgment because the latter purported to nullify the former. But our caselaw does
[A]ny description, recital of fact, or reference to other documents puts the purchaser upon inquiry, and he is bound to follow up this inquiry, step by step, from one discovery to another and from one instrument to another, until the whole series of title deeds is exhausted and a complete knowledge of all the matters referred to and affecting the estate is obtained.27
In other words, API, constructively and actually aware of the recorded 2003 Judgment, was responsible for squaring it with the contradictory 2004 Judgment.
Slaughter v. Qualls,
API argues that TxDOT’s acquiescence to the 2004 Judgment bars it from objecting now to what it accepted then. While the argument has a certain force— purchasers should be able to rely upon facially valid judgments — this argument goes to equitable estoppel, a doctrine inapplicable against the government in this case.
For estoppel to apply against the government, two requirements must exist: (1) “the circumstances [must] clearly demand [estoppel’s] application to prevent manifest injustice,”
As to the first requirement, we have applied estoppel to prevent manifest injustice if, “officials acted deliberately to induce a party to act in a way that benefitted the [government].”
We have also held that the fact that a governmental error was “discoverable” militates against applying estoppel.
IY. Conclusion
The 2004 Judgment was void. The pleadings and evidence establish that API holds no interest in the land and thus “cannot establish a viable takings claim,”
. See Tex. Prop.Code § 21.061 (providing that if no party objects to the findings of the special commissioners, the trial court "shall adopt the commissioners’ findings as the judgment of the court”).
. The record is unclear as to why the parties agreed to the 2004 judgment, or why TxDOT, which did not yet have- an interest in the property, would agree to the nunc pro tunc judgment.
. API paid $292,800 for approximately 34 acres, including the 9.869 acres at issue in this case.
. Tex. Dep't of Transp. v. A.P.I. Pipe & Supply, LLC, No. 13-07-221-CV, 2008 WL 99629, at *3-*5, 2008 Tex.App. LEXIS 276, at *8-* 14 (Tex.App.-Corpus Christi Jan. 10, 2008, no pet.) (mem.op.).
. Tex. Dep’t of Parks & Wildlife v. Miranda, 133 S.W.3d 217, 226 (Tex.2004).
. Id. at 227.
. Hearts Bluff Game Ranch, Inc. v. State, 381 S.W.3d 468, 491 (Tex.2012).
. Tex. Dep’t of Transp. v. City of Sunset Valley, 146 S.W.3d 637, 644 (Tex.2004).
. We have jurisdiction over this interlocutory appeal under Texas Government Code section 22.225(c) because of a conflict between the court of appeals’ decision and a decision of another court of appeals. See Tex.
. Andrews v. Koch, 702 S.W.2d 584, 585 (Tex.1986) (per curiam).
. Dikeman v. Snell, 490 S.W.2d 183, 186 (Tex.1973).
. Andrews, 702 S.W.2d at 585.
. See id. at 584-86 (using a nunc pro tunc judgment to add an easement to a deed; a prior court order had required the easement, so exclusion of the easement was clearly a clerical mistake).
. Id. at 586.
. There is circumstantial evidence that the 2003 Judgment intended to award a fee simple rather than an easement. The condemnation award approved by the court in the 2003 Judgment provided compensation of over $207,000 for 10 acres in April 2003, whereas API purchased that tract plus 20 more acres for approximately $90,000 more in August 2004.
. Tex. Prop.Code § 21.061.
. Id. § 21.018. The time for making objections to the special commissioners’ award is tolled if the parties are not given proper notice of the special commissioners’ award. John v. State, 826 S.W.2d 138, 141 n. 5 (Tex. 1992). However, there is no evidence here that there were any notice problems regarding the award.
.John, 826 S.W.2d at 141 n. 5. See also Pearson v. State, 159 Tex. 66, 315 S.W.2d 935, 938 (1958) (noting that if there are no objections to the special commissioners’ award, ”[n]o jurisdiction is conferred upon the court to do anything more than accept and adopt the [special commissioners’] award as its judgment, and this follows by operation of law and the ministerial act of the county judge”).
. See Tex R. Civ. P. 329b(d)-(f).
. Here, the 2004 Judgment was entered 351 days after the 2003 Judgment.
. Wall, 118 S.W. at 888.
. Tex. Prop.Code § 13.001(a).
. API does not argue, and we do not consider, whether the 2004 Judgment is a "correction instrument” under recently enacted sections 5.027-031 of the Property Code.
. Wall, 118 S.W. at 888.
. Cooksey v. Sinder, 682 S.W.2d 252, 253 (Tex.1984) (per curiam).
. 637 S.W.2d 903, 908 (Tex. 1982) (citations and quotations omitted) (emphases in original).
. 139 Tex. 340, 162 S.W.2d 671 (1942).
. Id. at 675.
. Id. at 674.
.That is, Slaughter says (in its explanation of its dicta):
It is true that under circumstances such as we have here, those who purchased interests in or took liens on the land in good faith from [the purchaser of a deed voided by a wrongful foreclosure sale] acquired good title as against [the debtor who had originally executed the deed of trust]; but this is so not on the theory that the title actually passed, but rather on the theory that [the debtor], by the execution of the deed of trust, made it possible for the trustee to create the appearance of good title in [the purchaser at the foreclosure sale], and it would he inequitable to permit [the débt- or] now to show otherwise as against those who have purchased in good faith in reliance thereon.
. City of White Settlement v. Super Wash, Inc., 198 S.W.3d 770, 774 (Tex.2006) (quotations omitted).
. Id. at 776-78.
. Id. at 775.
. Apparently for the first time, API argued at oral argument before this Court that TxDOT and the City did receive a benefit from their interest being merely an easement. API alleges that it let the government use other portions of API’s property, which API thought was required so that the government could make reasonable use of its purported easement. However, we find this argument unavailing. First, we note that this last-minute allegation of the government's benefit from the easement is not preserved for our review. Tex.R.App. P. 33.1(a). Further, this last-minute allegation is not even enough to lead us to remand to allow API to amend its jurisdictional allegations. Any purported benefit to TxDOT and the City is minimal compared to the substantial loss to the government for giving up its right to fee-simple title. This purported benefit is “simply too attenuated to establish grounds for equitable relief.” Super Wash, 198 S.W.3d at 775. Finally, availability of "alternative remedies weighs strongly against” estoppel against the government, id., and API may well have other remedies available for the government’s alleged wrongful use of API’s surrounding property in digging the ditch.
. Super Wash, 198 S.W.3d at 774-76 (explaining the significance of the only two cases where we have applied estoppel against the government, Roberts v. Haltom City, 543 S.W.2d 75 (Tex.1976) and City of San Antonio v. Schautteet, 706 S.W.2d 103 (Tex.1986)).
. Super Wash, 198 S.W.3d at 775.
. City of Tyler v. Likes, 962 S.W.2d 489, 501 (Tex.1997) (holding that, under common law, "design and planning" of drainage ditches was a “quasi-judicial function[] subject to governmental immunity,” whereas "the acts of constructing and maintaining a storm sewer are proprietary at common law”). The Texas Tort Claims Act also classifies governmental acts related to "sanitary and storm sewers” as "governmental functions." Tex. Civ. Prac. & Rem.Code § 101.0215(9). While this legislative interpretation of "governmental functions” is binding only in the context of the Tort Claims Act, we have previously found that "the statute is helpful” in our interpretation of whether an activity is a "governmental function.” Super Wash, 198 S.W.3d at 776-77.
. If we found that the government was es-topped, the government would have only a few options for removing dirt from the property, such as paying API to remove the dirt, relying on API to remove the dirt, or obtaining API’s consent to let the government dump the dirt on API’s surrounding land. Any of these options could impair plans to expand or improve the ditches by impeding the dirt-removal process.
. Hearts Bluff Game Ranch, 381 S.W.3d at 491.
. Id. at 491-92.
Concurrence Opinion
joined by Justice
GUZMAN, concurring.
I join the Court’s opinion because I agree that the 2004 Judgment, which was issued after the expiration of the trial court’s plenary power, makes a judicial change to the 2008 Judgment and is therefore void. I write separately to clarify why I agree.
As the Court notes, “a significant alteration to the original judgment may be accomplished through a judgment nunc pro tunc so long as it merely corrects a clerical error.” 397 S.W.3d at 167 (citing Andrews v. Koch, 702 S.W.2d 584, 584-86 (Tex.1986) (per curiam)). Indeed, clerical errors frequently concern matters of substance; they are simply errors “made in entering final judgment” and not “in rendering a final judgment.” Escobar v. Escobar, 711 S.W.2d 230, 231 (Tex.1986). Thus, the fact that the change made in the 2004 Judgment — which awards the City an easement as opposed to the fee simple interest awarded in the 2003 Judgment — is undeniably significant has no bearing on the validity of the nunc pro tunc judgment. Rather, the change was invalid because the 2003 Judgment correctly reflects the true decision of the court, and the 2004 Judgment therefore improperly makes a judi
In many cases, depending on the state of the record, it may be difficult for an appellate court to discern which of two conflicting judgments accurately “reflects the true decision of the [trial] court,” 397 S.W.3d at 167 (quoting Andrews, 702 S.W.2d at 586) (internal quotation marks omitted), and, in turn, whether a judgment nunc pro tunc is valid. However, this case does not present such a dilemma. The evidence establishing the fee simple nature of the conveyance reflected in the 2003 Judgment is conclusive. In that judgment, the trial court ordered that the special commissioners’ award “is hereby made[] the judgment of this [c]ourt.” In turn, the special commissioners “award[ed] to [the City] all rights described and prayed for in [the City]’s Original Statement and Petition for Condemnation.” And the City’s condemnation petition requested “a final judgment of condemnation vesting in the City of Edinburg the fee title to said land and the rights therein.” Further, as noted by the Court, the trial court in this case essentially conducted a ministerial duty in entering judgment on the special commissioners’ findings, to which no one had objected. 397 S.W.3d at 167-68. In light of this evidence, there is no question that the “true decision of the court” was to award fee simple title. Thus, the 2004 Judgment’s award of an easement to the City did not merely correct a clerical error and could not be accomplished through a judgment nunc pro tunc.
API contends the’ use of the term “right-of-way” in the City’s condemnation petition and the 2003 Judgment renders it unclear whether the 2003 Judgment was awarding fee simple title or an easement. For example, the 2003 Judgment awards the City “title (right of way) described in attached Exhibit ‘A’ [the special commissioners’ award] and ‘B’ [condemnation petition],” and orders issuance of a writ of possession to allow the City to “enter upon said right-of-way.” The commissioners’ award notes that the City sought a decree “vesting in [the City] a right-of-way ... more fully described in [the City]’s [petition.” The condemnation petition, in the paragraph setting out the purpose for the action, alleges that the land is sought for the purpose of “laying out, opening, constructing, reconstructing, maintaining, and operating ... a certain right-of-way,” specifically the U.S. Highway 281 Drainage outfall ditches project.
However, such language does not call into question the effect of the 2003 Judgment. The term “right-of-way,” used alone, may mean either a “right of passage” over a parcel of land or the parcel of land itself that “is to be used as a right of way.” Tex. Elec. Ry. Co. v. Neale, 151 Tex. 526, 252 S.W.2d 451, 454 (1952); see also Lakeside Launches, Inc. v. Austin Yacht Club, Inc., 750 S.W.2d 868, 871 (Tex. App.-Austin 1988, writ denied). There is no indication that the condemnation petition, the special commissioners’ award, or the 2003 Judgment used the term “right-of-way” synonymously with an easement or right of passage; rather, it was used to denote the property itself.
Further, the City’s agreement with the issuance and recording of the 2004 Judgment nunc pro tunc, while potentially relevant to an equitable claim, does not call into question the true decision of the trial court in entering the 2003 Judgment. At that time, the trial court had before it the City’s request for a judgment for “fee title” in the property and the unobjected-to special commissioners’ award, which awarded all rights prayed for in the petition. Again, because the 2003 Judgment adopted the award as the judgment of the
It bears repeating that the invalidity of the 2004 Judgment is not evident from the fact that the two judgments are facially in conflict, which in and of itself does not raise suspicion. In reality, most nunc pro tunc judgments conflict substantively with the underlying judgments they are entered to correct. The nunc pro tunc judgment that merely corrects a misspelled word or a grammatical error is an anomaly. After all, reasonable parties do not generally file lawsuits to correct trivial mistakes such as missing commas or misspelled words. Rather, reasonable litigants go to court to correct clerical errors affecting substantive rights. A thorough review of this record, however, conclusively shows that the true decision of the trial court, as reflected in the 2003 Judgment, was to award fee simple title to the City.
Given that the 2004 Judgment was void, API could not acquire legal title from White because the City owned the land. I agree with the Court that any recovery against TxDOT and the City would necessitate application of the doctrine of equitable estoppel, which does not apply against the government under the circumstances of this case. Accordingly, I concur in the Court’s opinion and judgment.