Will Houston Award of Nuisance Damages Stymie Urban Development?

A Houston trial court allowed a jury award to stand in favor of 20 homeowners who filed suit in opposition to a proposed urban residential 21- story high – rise development. Neighboring homeowners had opposed the Ashby High-Rise development for six years before suit was filed in 2013. The jury found that a private nuisance existed as to 20 of the 30 plaintiffs and awarded approximately 1.2 million dollars in damages for diminution in their property values and approximately $ 400,000 for loss of use and enjoyment of their property. The court allowed the decrease in value damages but disallowed the loss of use damages because they were speculative until the project is constructed. An appeal is anticipated.

In a lengthy order, the trial court concluded that there was sufficient evidence to support a jury finding of private nuisance because the proposed development would be “abnormal and out of place in its surroundings,” and that it “substantially interferes with Plaintiffs’ use and enjoyment of their land.”   Plaintiffs argued several factors contributed to a nuisance: increased traffic; loss of privacy; foundation damage to adjacent landowners due to settlement; increased light to adjacent landowners; construction annoyances; and shadow cast by the Project with resulting vegetation damage. Despite the jury finding of damages, the plaintiffs asked the court to grant a permanent injunction preventing the project from being built at all instead.

The court denied injunctive relief and discussed some of the reasons why. First, the nuisance was “very localized” in that plaintiffs north of the Project lost, and a nuisance was only found as to plaintiffs within approximately 200 feet of the Project. Next, it would be very difficult to enforce an injunction as such an order would not end the controversy. The developer could come back and apply to the city for a modified project to be followed by another lawsuit. Then the court balanced the equities and concluded that an injunction would harm both the defendant and the City of Houston. The court noted the amount of time and expense the developer had devoted to the Project. As for the City of Houston, the court acknowledged Houston’s unique absence of zoning and stated: “there is no question but that it will have a chilling effect on other development in Houston. For better or worse, the City of Houston has repeatedly opted against zoning . . . If an injunction was issued, then a judge can become a one man zoning board with little criteria . . . perhaps Houston should reconsider whether zoning is appropriate for this City.“

The court concluded that the Project “will provide benefits to the city as a whole” with tax revenues, housing and the reduction in urban sprawl and freeway congestion. The court also noted that the City of Houston approved the Project and extracted concessions from the defendant in doing so, that other mid-rise residential projects were developed in the neighborhood, and that the privacy concerns of the plaintiffs predated the Project because the prior structure had two story apartments. Last, the court pointed out, although of lesser importance, that some plaintiffs bought their properties after the development of the Project, and that the plaintiffs had aggressively fought the project with threats of picketing and boycotts. The court quoted the threat from evidence presented at trial: “we will appear at the homes of the owners, investors, and chef of your restaurant tenant and demonstrate our opposition to their presence in our neighborhood.” Plaintiffs, therefore, violated the rule that a party who seeks equity (injunctive relief) must do equity (behave nicely).

Here is a link to the May 1, 2014 order:

http://www.justex.net/JustexDocuments/12/Ashby opinion.pdf

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