Friday, May 18, 2012

Astroworld Property Tax Aftermath: How much is the urban prairie at the South Loop worth now?


… or, rather, how much was it worth in 2006, which was the issue in an ad-valorem tax appraisal dispute which finally reached decision-stage in one of our local courts of appeals a few years more down the road ....while the the weeds have been growing.  
     
APPRAISING THE AMUSEMENT PARK sans THE AMUSEMENTS:
 
The Appraiser was not amused and appealed the reduction in appraised value obtained by the owner in its successful tax protest to the district court, and then to the court of appeals.  The decision came down yesterday. Appraiser has yet more reason not to be amused, as the First Court’s panel assigned to the case, in an opinion by Justice Massengale, upholds the reductions in the appraised value of the Houston’s premier playground-turned-weedland, which has been sitting vacant in hopes of a brighter future along with the  domed -- and now likely doomed -- erstwhile world wonder just North of the 610 South.
Rare Astroworld antique: Duck on wheels adorning parking lot in West Houston

Harris County Appraisal District v. Houston 8th Wonder Property, L.P., d/b/a Six Flags Astroworld (Tex.App.- Houston [1st Dist.] May 17, 2012, no pet. h.)
O P I N I O N


Appellee Houston 8th Wonder Property, L.P., d/b/a Six Flags Astroworld successfully protested the 2006 appraised and market values of its commercial property as determined by appellant Harris County Appraisal District.  See Tex. Tax. Code Ann. § 41.41(a) (West 2008).  Both the property owner and the appraisal district invoked their rights to seek judicial review of the appraisal review board’s valuation.  See id. §§ 42.01, 42.02 (West Supp. 2011).  The appraisal district’s appeal was dismissed for want of jurisdiction.  After a de novo bench trial, the district court entered a final judgment further lowering the appraised value of the property, and the appraisal district now appeals from that judgment.  See id. § 42.28.

We conclude that the dismissal of the appraisal district’s appeal was error.  Despite this error, the ruling that the appraisal district sought to challenge by its appeal—the appraisal review board’s valuation—remained at issue in the de novo trial that ensued for the property owner’s appeal.  The record reflects that the appraisal district was permitted to actually present its arguments and evidence about the market value of the property, both at trial and in post-trial briefing, and without any substantive limitation.  Because the district court ultimately heard and determined the appraised value of the property de novo, on this record there is no basis to conclude that the error probably caused the rendition of an improper judgment.  See Tex. R. App. P. 44.1(a).
We also reject the appraisal district’s remaining issues on appeal, relating to the admissibility of expert testimony and the constitutionality of the judgment.  Accordingly, we affirm.
Background
Houston 8th Wonder purchased 104.196 acres of unimproved land in Harris County on May 31, 2006 for $77,000,000.  This property was formerly the site of the Six Flags Astroworld theme park.  The Harris County Appraisal District appraised 101.833 acres of the purchased tract at a value of $74,668,035 for the 2006 tax year.  The property owner protested this appraisal to the appraisal review board under section 41.44 of the Tax Code, presenting two grounds: (1) “Value is over market,” and (2) “Value is unequal compared with other properties.”  The ARB panel “determined that the property appraisal is incorrect and unequal and the value should be changed.”  The ARB reduced both the property’s market value and appraised value from $74,668,035 to $48,054,000.
Both the property owner and the appraisal district appealed to the district court.  The property owner sought relief for unequal appraisal, alleging that it was “entitled to have the court order the value changed to [the] median level of appraisal in accordance with Section 42.26 of the Texas Tax Code.”  The appraisal district alleged that the “appraised value as determined by the Appraisal Review Board is far lower than the actual fair market value of the Property as of January 1, 2006,” and it requested that the court “determine the market value of the Property and increase its appraised value on the appraisal roll as authorized by sections 42.23 and 42.24 of the Tax Code.”
The property owner filed a motion to dismiss the appraisal district’s appeal for lack of jurisdiction.  The district court granted that relief after a hearing.  A de novo bench trial was conducted on the property owner’s appraised-value challenge.  The district court rendered judgment in favor of the property owner that the appraised value of the subject property was $31,938,000.00 for the 2006 tax year.  The court also issued findings of fact and conclusions of law.  The appraisal district now appeals from that judgment.
Analysis
I.               Appraisal district’s appeal from appraisal review board’s order
In its second issue, the appraisal district argues that the district court erred by granting the property owner’s plea to the jurisdiction because the statutory requirements for an appeal of an ARB order by the chief appraiser had been satisfied.  We review a trial court’s ruling on a plea to the jurisdiction de novo.  KM-Timbercreek, L.L.C. v. Harris Cnty. Appraisal Dist., 312 S.W.3d 722, 726 (Tex. App.—Houston [1st Dist.] 2009, no pet.).
A.   Right of appeal by chief appraiser
Section 42.02 of the Property Tax Code provides that “the chief appraiser is entitled to appeal an order of the appraisal review board determining” a taxpayer protest.  Tex. Tax Code Ann. § 42.02(a)(1).  A chief appraiser who wishes to appeal such an order of the ARB must (1) obtain written approval of the board of directors of the appraisal district, (2) file a written notice of appeal within 15 days of receipt of the notice from the ARB determining the taxpayer protest, and (3) deliver a copy of the notice of appeal to the property owner whose property is involved in the appeal.  Id. §§ 42.02(a), 42.06(a), (c) (West 2008 & Supp. 2011).  In this case, the chief appraiser obtained written approval from the board of directors to appeal the ARB order determining the property owner’s protest.  Six days later, the appraisal district filed a notice of appeal and sent a copy to the property owner.  The appraisal district thus satisfied the statutory prerequisites to appeal the ARB order.  The property owner presented three arguments to the court in support of its plea, each of which we address below.
1.       Actual market valuation controversy. 
The appraisal district’s petition sought a determination of “the market value of the Property.”  The property owner argued in the district court that its original tax protest had been limited to the question of equal and uniform appraisal because that was the only relevance of the evidence it presented to the ARB.  See Tex. Tax Code Ann. § 42.26 (West 2008) (remedy for unequal appraisal).  The property owner thus argued that the ARB’s order did not implicate market value and there was “no ARB order for [the appraisal district] to appeal based on market value.”  However, the “Property Tax Notice of Protest” filed by the property owner listed two reasons for protest, namely: (1) value is over market and (2) value is unequal compared with other properties.  In addition, the ARB order actually determined that the original property appraisal was both “incorrect and unequal,” and it reduced not only the “appraised” value but also the “market” value from $74,668,035 to $48,054,000.  Accordingly, the suggestions that the property owner did not challenge the property’s market value and that the ARB did not actually lower market value are affirmatively disproved by the record on appeal.
2.       Appraisal district’s “standing” to challenge ARB order. 
In a brief supporting the plea to the jurisdiction, the property owner argued that the chief appraiser had “no standing to appeal that which he had no standing to protest.”  The court apparently found this argument persuasive, as its conclusions of law expressly noted that it lacked jurisdiction over the appraisal district’s appeal because the “Chief Appraiser has no right of appeal of an ARB order on any basis which the protesting property owner does not have.”  The consequence of this reasoning is that the property owner’s evidence and arguments presented to the ARB establish the exclusive parameters for any subsequent appeal of the ARB ruling by either party to the proceeding.  Thus the property owner contended that the appraisal district could not appeal the order on market-value grounds that had not been a basis for the original tax protest. 
This argument is apparently premised upon the requirement applicable to property owners that administrative remedies must be exhausted before seeking judicial review of an appraisal district’s property valuation.[1]  However, the procedural differences between the avenues of appeal available to the property owner and the appraisal district require that the exhaustion principle be applied differently to the two types of appeals.  Only the property owner, and not the chief appraiser or the taxing unit, has the right to protest the appraised value of a single taxpayer’s property before the ARB.[2]  But both the property owner and the chief appraiser have distinct rights to appeal the ARB order determining the protest.[3] 
Unlike the property owner, the appraisal district had no prior administrative remedy to exhaust at the ARB stage of the proceedings.  As the entity responsible for the initial property valuation, the appraisal district had no right to initiate the protest procedure and no control over what objections would be presented by the property owner to the ARB.  Regardless of what issues were presented by the property owner, the appraisal district had no grievance until the ARB altered its determination of the property’s market value and appraised value.  The statutory procedure for the appraisal district to complain about the ARB’s ruling began with its right of “appeal” to the district court for a trial de novo.  Thus, because the appraisal district contended that the ARB erred by reducing the property’s market value and appraised value, and it followed the statutory procedures for initiating an appeal, it had standing to challenge the ARB’s order in accordance with its statutory right to do so.  There was no prior administrative procedure available to the appraisal district that it failed to exhaust.
3.       Relevance of market valuation. 
Finally, the property owner argued that market value, which the appraisal district sought to challenge in its appeal, is irrelevant to the issue of unequal appraisal, which was a basis of the property owner’s protest to the ARB and appeal to the district court.  Section 42.26 of the Tax Code specifies three methods for determining if a property has been unequally appraised: 
The district court shall grant relief on the ground that a property is appraised unequally if:
(1)     the appraisal ratio of the property exceeds by at least 10 percent the median level of appraisal of a reasonable and representative sample of other properties in the appraisal district;
(2)     the appraisal ratio of the property exceeds by at least 10 percent the median level of appraisal of a sample of properties in the appraisal district consisting of a reasonable number of other properties similarly situated to, or of the same general kind or character as, the property subject to the appeal; or
(3)     the appraised value of the property exceeds the median appraised value of a reasonable number of comparable properties appropriately adjusted.
Tex. Tax Code Ann. § 42.26(a).  Although market value may not be necessary to a determination made pursuant to Tax Code section 42.26(a)(3), it is not irrelevant to a determination of appraisal value made pursuant to section 42.26(a)(1) & (2).  Section 1.12 of the Tax Code defines the term “appraisal ratio” as used in section 42.26(a)(1) & (2) as follows:
An appraisal ratio is the ratio of a property’s appraised value as determined by the appraisal office or appraisal review board, as applicable, to:
(1)           the appraised value of the property according to law if the property qualifies for appraisal for tax purposes according to a standard other than market value; or
(2)           the market value of the property if Subdivision (1) of this subsection does not apply.
Id. § 1.12(b).  Because market value is an element of the calculation of “appraisal ratio” that may be used to determine whether an appraisal is equal and uniform, the market value is not irrelevant,[4] and the property owner’s argument to the contrary was incorrect.
We conclude that the appraisal district had the right to appeal from the ARB’s order.  Irrespective of any rights the property owner might exercise to appeal from an order of the appraisal review board, the Tax Code separately authorizes the chief appraiser to appeal an ARB order determining a taxpayer protest.  Id. § 42.02(a)(1).  In this case, the appraisal district fulfilled all of the statutory requirements to appeal the ARB’s order by (1) filing a timely notice of appeal, (2) obtaining written approval of the board of directors, and (3) notifying the taxpayer that the chief appraiser has filed a notice of appeal.  See id. §§ 42.02, 42.06.  The appraisal district’s appeal was not barred for failure to exhaust administrative remedies; it had no predicate administrative remedy to exhaust in this situation.  Finally, market value was not irrelevant to the questions at issue in this appeal.  Accordingly, we hold that the district court had jurisdiction over the appraisal district’s appeal.
B.   Harm analysis
To reverse the judgment on appeal, we must conclude that any error probably caused the rendition of an improper judgment or prevented the appellant from properly presenting its appeal.  Tex. R. App. P. 44.1(a).  To make this determination, we review the entire record.  See, e.g., McCraw v. Maris, 828 S.W.2d 756, 758 (Tex. 1992).  We are also mindful that an erroneous decision by a trial court can be rendered harmless by subsequent events.  See, e.g., Progressive Cnty. Mut. Ins. Co. v. Boyd, 177 S.W.3d 919, 921 (Tex. 2005).
In the circumstances of this case, a de novo bench trial mooted the effect of granting the property owner’s jurisdictional plea.  Both parties had attempted to appeal from the ruling of the ARB—the appraisal district wanted to increase the ARB’s appraised value of the property, while the property owner wanted to further decrease that value.  After dismissing the appraisal district’s appeal, the court conducted a trial de novo, in which it was empowered to grant the relief in favor of either side by either increasing or decreasing the property values at issue.  See Cherokee Water Co. v. Gregg Cnty. Appraisal Dist., 801 S.W.2d 872, 877 (Tex. 1990).  The district court granted relief in favor of the property owner, further reducing the appraised value of the property beyond the reduction already achieved in the protest proceeding before the ARB. 
If the court had not dismissed the appraisal district’s appeal, the resulting proceeding still would have concerned the appraised value of the same property.  The appraisal district was not required to perfect its own appeal for the trial court to have the ability to increase the property value in its de novo determination of “the appraised value of property in accordance with the requirements of law.”  Tex. Tax Code Ann. § 42.24(a); see Cherokee Water, 801 S.W.2d at 877.  The appraisal district remained free to present its evidence and arguments in favor of a higher value, and the record does not show that the appraisal district was in any way prevented from doing so.  Even though the appraisal district’s appeal was dismissed and the property owner took the position that evidence of market value was irrelevant to the proceeding, the district court nevertheless admitted all of the evidence offered by the appraisal district, including evidence of market value which was admitted over the property owner’s relevance objections.  The appraisal district also cross-examined the property owner’s valuation expert about his failure to incorporate market value into his analysis.
The appraisal district has provided no suggestion of how the erroneous dismissal of its appeal probably caused the rendition of an improper judgment with respect to the trial court’s final determination of appraised value.  See Tex. R. App. P. 44.1(a).  Neither has it demonstrated that the error probably prevented it from presenting its appeal.  See id.  Our review has revealed no such harm.  We therefore overrule the appraisal district’s second issue. 
II.            Expert testimony 
In its first issue, the appraisal district argues that the trial court abused its discretion in admitting the testimony of the property owner’s expert, Gerald Teel.  The appraisal district contends that Teel’s testimony was unreliable because of a flawed methodology and his failure to produce certain documents upon which he relied.  For these reasons, the appraisal district asserts that Teel’s testimony was no evidence.
Ordinarily, a challenge to the admissibility of evidence, including whether expert testimony is reliable, is reviewed for an abuse of discretion.  Whirlpool Corp. v. Camacho, 298 S.W.3d 631, 638 (Tex. 2009); see Harris Cnty. Appraisal Dist. v. Kempwood Plaza, Ltd., 186 S.W.3d 155, 157 (Tex. App.—Houston [1st Dist.] 2006, no pet.).  A trial court has broad discretion in deciding whether to admit or exclude expert testimony, and this court will uphold a trial court’s evidentiary ruling if a legitimate basis for the ruling exists.  See Gammill v. Jack Williams Chevrolet, Inc., 972 S.W.2d 713, 719–20 (Tex. 1998); Weingarten Realty Investors v. Harris Cnty. Appraisal Dist., 93 S.W.3d 280, 283 (Tex. App.—Houston [14th Dist.] 2002, no pet.).  We will reverse only if the court acted arbitrarily, unreasonably, or without reference to any guiding rules or principles.  Kempwood Plaza, 186 S.W.3d at 157. 
To be admissible, expert testimony must be both relevant and reliable.  Gammill, 972 S.W.2d at 727; Kempwood Plaza, 186 S.W.3d at 157.  Expert testimony is relevant when it assists the fact finder in determining an issue or in understanding other evidence.  See Tex. R. Evid. 702; TXI Transp. Co. v. Hughes, 306 S.W.3d 230, 234 (Tex. 2010).  As to reliability, the court must examine the expert’s methodology, foundational data, and whether too great an analytical gap exists between the data and methodology, on the one hand, and the expert’s opinions, on the other.  See Gammill, 972 S.W.2d at 728; Kempwood Plaza, 186 S.W.3d at 159.  “[I]t is the basis of the witness’s opinion, and not the witness’s qualifications or his bare opinions alone, that can settle an issue as a matter of law; a claim will not stand or fall on the mere ipse dixit of a credentialed witness.”  Burrow v. Arce, 997 S.W.2d 229, 235 (Tex. 1999).
When a party asserts on appeal that an expert’s testimony is insufficient because it is unreliable, a court will ordinarily consider both the Robinson reliability factors and the expert’s experience.  Whirlpool, 298 S.W.3d at 638; see E.I. du Pont de Nemours & Co. v. Robinson, 923 S.W.2d 549, 556 (Tex. 1995) (identifying factors for courts to consider in evaluating reliability of expert testimony).  Robinson set out the following list of nonexclusive factors: (1) the extent to which the theory has been or can be tested, (2) the extent to which the technique relies upon the subjective interpretation of the expert, (3) whether the theory has been subjected to peer review and/or publication, (4) the technique’s potential rate of error, (5) whether the theory or technique has been generally accepted as valid by the relevant scientific community, and (6) the non-judicial uses which have been made of the theory or technique.  Robinson, 923 S.W.2d at 557.  However, not all of these factors may applicable to a case, like this one, involving specialized but non-scientific expert testimony.  See Weingarten, 93 S.W.3d at 285; see also Kempwood Plaza, 186 S.W.3d at 157.  Likewise, when the opponent of the testimony stipulates that the expert is qualified, an appellate court need not review that finding.  See Kempwood Plaza, 186 S.W.3d at 158.
Because the appraisal district stipulated that Teel was qualified as a real estate appraiser, we limit our analysis to the reliability of his testimony.  Thus, we will examine his methodology and the foundational data upon which he relied.  Teel testified that his assignment was to evaluate the subject property under section 42.26 of the Texas Tax Code.  Section 42.26(a)(3) provides that “[t]he district court shall grant relief on the ground that a property is appraised unequally if: . . . the appraised value of the property exceeds the median appraised value of a reasonable number of comparable properties appropriately adjusted.”  Tex. Tax Code Ann. § 42.26(a)(3).  The “‘appraised value’ means the value as determined by Chapter 23 of this code.”  Id. § 1.04(8).  Chapter 23 provides that, “[e]xcept as otherwise provided by this chapter, all taxable property is appraised at its market value as of January 1.”  Id. § 23.01(a) (West Supp. 2010).
To determine if “the appraised value of the property exceeds the median appraised value of a reasonable number of comparable properties appropriately adjusted” under section 42.26(a)(3), “the appraisal expert determines a reasonable number of comparable properties.  Then, the expert takes the appraised value of those properties from the public record, and appropriately adjusts them to the subject property.”  In re MHCB (USA) Leasing & Fin. Corp., No. 01-06-00075-CV, 2006 WL 1098922, at *3 (Tex. App.—Houston [1st Dist.] Apr. 27, 2006, orig. proceeding) (mem. op.) (quoting Weingarten, 93 S.W.3d at 286) (examining application of former section 42.26(d), now found at section 42.26(a)(3)).  The comparable properties are adjusted according to factors that tend to influence value, such as location, age, depreciation, physical characteristics of the property, and “economic factors.”  Id.; see Harris Cnty. Appraisal Dist. v. United Investors Realty Trust, 47 S.W.3d 648, 650 n.4 (Tex. App.—Houston [14th Dist.] 2001, pet. denied); see also Kempwood Plaza, 186 S.W.3d at 160–61.  Finally, “the appropriately adjusted comparable properties are arrayed and a median is determined.”  Weingarten, 93 S.W.3d at 286.
Section 42.26(a)(3) does not delineate what specific considerations are relevant for adjustment.  MHCB, 2006 WL 1098922, at *4.  In Harris County Appraisal District v. United Investors Realty Trust, the parties relied upon values of comparable properties taken from the appraisal district’s tax rolls, but they made adjustments for location, traffic, access, age, and depreciation.  47 S.W.3d 648, 650 n.4 (Tex. App.—Houston [14th Dist.] 2001, pet. denied).  The Fourteenth Court of Appeals held that a protest alleging only that the appraised value is not uniform and equal does not require independent proof of the market value of the comparable properties.  Id. at 653.  The court explained that the tax rolls could be used to determine value, with “the only independent analysis required [being] adjusting the appraised values to put the properties on equal footing.”  Id.  This court has also held that an appraiser may base his adjustments on his personal experience.  Kempwood Plaza, 186 S.W.3d at 161 (“Appraising property is not an exact science based on set mathematical formulas.  It is not error for an appraiser to use his or her personal experience and expertise to make certain determinations.”).
Teel testified that he considered adjustments for location to be much more subjective than adjustments for size of the property, which could be done based on a well-established logarithmic relationship between size and value that is commonly used among appraisers in his industry.  Therefore, he considered only properties that had the same “neighborhood code” on tax rolls of the appraisal district.  He testified that he looked to properties that were being used for the types of businesses that would potentially form part of the mixed-use, which was the highest and best use of the subject property.  He considered only the unimproved value of the comparable properties because the subject property was unimproved.  He also testified that the comparables were smaller than the subject property because there were no properties of a similar size in the relevant location. 
Teel’s testimony makes clear that he followed a statutorily-approved methodology for estimating an appraised value.  See Tex. Tax Code Ann. § 42.26(a)(3).  He used the appraisal value of the comparable properties as listed in the tax rolls as his starting point.  When he adjusted the values of the comparable properties, he relied on generally accepted appraisal principles that are commonly used among professionals in his field.  Teel testified that his methodology had been tested, was generally accepted as valid, and was mandated, to some extent, by statute.  See, e.g., Robinson, 923 S.W.2d at 557.  By choosing to limit the comparable properties he selected to those near the subject property, he minimized the extent to which his analysis relied on his subjective interpretation.  See id.  We conclude that Houston 8th Wonder met its burden to show the reliability of Teel’s testimony, and we hold that the trial court did not abuse its discretion in admitting his testimony.  In addition, we further hold that Teel’s testimony was legally sufficient to support the trial court’s judgment.
Accordingly, we overrule the appraisal district’s first issue.
III.         Constitutionality of the trial court’s judgment
In its third and final issue, the appraisal district argues that the trial court’s judgment determining that the value of the subject property was approximately $31 million was unconstitutional because that value was unrelated to market value.  This court rejected this argument in Kempwood Plaza.  See Kempwood Plaza, 186 S.W.3d at 162.  We overrule the appraisal district’s third and final issue.
Conclusion
We affirm the judgment of the trial court.
Michael Massengale
Justice
Panel consists of Justices Jennings, Bland, and Massengale.
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[1]         “Because the administrative procedures established by the Code are exclusive of a taxpayer’s other remedies, a taxpayer must first exhaust all administrative remedies before seeking judicial review of a taxing authority’s actions.”  ABT Galveston Ltd. P’ship v. Galveston Cent. Appraisal Dist., 137 S.W.3d 146, 152 (Tex. App.—Houston [1st Dist.] 2004, no pet.).  The taxpayer’s failure to comply with the Code requirements, such as not protesting the initial valuation before the appraisal review board, deprives the reviewing district court of jurisdiction over the taxpayer’s appeal.  See, e.g., id. at 152.
 [2]         See Tex. Tax Code Ann. § 41.41 (West 2008) (property owner’s right of protest); see also id. § 41.03(a) (challenge by taxing unit may not include “the appraised value of a single taxpayer’s property”).
 [3]         See id. § 42.01 (right of appeal by property owner); id. § 42.02 (right of appeal by chief appraiser).  Such appeals are to the district court, and review is “by trial de novo.”  Id. § 42.23(a).
 [4]         See In re MHCB (USA) Leasing & Fin. Corp., No. 01-06-00075-CV, 2006 WL 1098922, at *4 (Tex. App.—Houston [1st Dist.] Apr. 27, 2006, orig. proceeding) (mem. op.) (stating that “information regarding both the appraised and the market value of comparable properties, insofar as this information shows the need for the ‘adjustments’ contemplated by the statute, including quality, size, age, and depreciation, could be potentially relevant to a determination of whether an appraisal district has appraised properties unequally”). 


Thursday, May 17, 2012

Litigating Finality: Is an order granting a motion for summary judgment final and appealable? ... It all depends


APPELLATE JURISDICTION DEPENDS ON FINALITY OF ORDER APPEALED FROM   [UNLESS INTERLOCUTORY APPEAL IS OTHERWISE AUTHORIZED]


What if there was a counterclaim, which was not addressed by the summary judgment motion and therefore wasn’t properly before the judge for adjudication? Can you appeal? Well, it depends, as illustrated by an opinion released May 17, 2012. The lesson: Pay careful attention to the wording of the [proposed] order granting the motion for summary judgment. Additional complication in this case: Filing fee was not paid when counterclaim was filed. So was it even a pending claim at the time of the SJ hearing?
 
MEMORANDUM OPINION BY JUSTICE HARVEY BROWN
  

Linda Kujawa appeals from the trial court’s order granting summary judgment in favor of Myrta Kujawa on Linda’s adverse possession and prescriptive easement claims. Because we conclude that the summary judgment order is not a final and appealable judgment, we dismiss this appeal for lack of jurisdiction.
  
Background
  
Linda and Myrta are neighbors and relatives-by-marriage. Linda purchased the home next door to Myrta after the passing of the home’s previous owner, Linda’s aunt and Myrta’s sister-in-law. The home’s roof, air conditioning unit, and window awning encroach onto Myrta’s property.[1] Linda filed suit against Myrta for adverse possession and prescriptive easement over the approximately two-foot strip of Myrta’s property on which the home encroaches. Myrta filed a counterclaim for trespass to try title, but she failed to pay the filing fee.
  
After discovery, Myrta moved for no-evidence summary judgment. The summary judgment motion addressed Linda’s claims against Myrta but not Myrta’s counterclaim. Linda filed an untimely response to Myrta’s summary judgment motion. The trial court granted Myrta’s motion for summary judgment, stating that it had considered both Myrta’s motion and Linda’s “untimely response.”
  
Myta later moved to modify the summary judgment order, asking the trial court to make the judgment a partial summary judgment so that she could pay the filing fee and prosecute her counterclaim. Linda objected to the motion to modify and moved for reconsideration of the summary judgment, for a new trial, and for leave to file evidence out of time.[2] The trial court denied Linda’s motions and did not rule on Myrta’s motion to modify. Linda appealed.
  
Jurisdiction
  
In her first issue, Linda challenges this court’s jurisdiction to hear her appeal, asserting that the order from which she appeals is not a final, appealable judgment. A trial court’s summary judgment order is final and appealable if it actually or expressly disposes of all parties and claims in the suit. See Lehmann v. Har-Con Corp., 39 S.W.3d 191, 200 (Tex. 2001) (holding that summary judgment order is final judgment if it actually disposes of all parties and claims or if it expressly states that it “finally disposes of all parties and all claims and is appealable”). If the order does not actually dispose of all parties and claims or expressly state that it disposes of all parties and claims, it is interlocutory. See id. Absent certain statutory authorization not asserted here, this Court lacks jurisdiction over appeals from interlocutory orders. See id. at 195 & n.12.
   
Linda asserts that the trial court’s summary judgment order is not a final judgment because it does not address Myrta’s counterclaim. In the trial court, Linda initially asserted that the trial court’s summary judgment order was final, resulting in the forfeiture of Myrta’s counterclaim.[3] On appeal, Linda asserts that Myrta’s counterclaim was properly before the trial court, such that the trial court’s failure to address the counterclaim renders the judgment interlocutory. Myrta responds that a pleading filed without payment of the filing fee is “conditionally filed.” Therefore, she contends, her counterclaim was not before the trial court, and the trial court’s judgment disposes of all claims properly before the court.
    
A.      The trial court had discretion to consider or not consider Myrta’s counterclaim 
   
In Tate v. E.I. DuPont de Nemours & Co., Inc., a party filed a timely motion for new trial but did not pay the filing fee for the motion until after it was overruled by operation of law, though payment was made within the trial court’s plenary power. 934 S.W.2d 83, 83 (Tex. 1996). Concluding that the motion was “conditionally filed when [the party] presented it to the clerk, and the filing became complete when she later paid the filing fee,” the Texas Supreme Court held that the motion validly extended the deadline for filing an appeal. See id. at 84 (“Accordingly, the failure to pay the fee before the motion is overruled by operation of law may forfeit altogether the movant’s opportunity to have the trial court consider the motion; it does not, however, retroactively invalidate the conditional filing for purposes of the appellate timetable.”). More recently, the Texas Supreme Court has extended this holding to circumstances in which the filing fee for a motion for new trial was never paid. Garcia v. Garcia, 137 S.W.3d 36, 38 (Tex. 2004). In both cases, the Court noted that, absent emergency or other rare circumstances, the trial court should not consider the motion for new trial until the filing fee is paid. Garcia, 137 S.W.3d at 38; Tate, 934 S.W.2d at 84. And in Garcia, the Court held that, because the motion for new trial was never properly before the trial court, the motion failed to preserve any error for appeal. Garcia, 137 S.W.3d at 38 (“Garcia’s factual sufficiency complaint had to be raised in a motion for new trial, but because she never paid the $15 fee, the trial court was not required to review it. As her complaint was never properly made to the trial court, it preserved nothing for review”). A trial court has the authority to act on motions filed without payment of the filing fee but need not do so. See Garcia, 137 S.W.3d at 38; Tate, 934 S.W.2d at 84.
    
This Court has held that a trial court has jurisdiction over claims that were filed in the trial court without payment of a filing fee. Tanner v. Axelrad, 680 S.W.2d 851, 853 (Tex. App.—Houston [1st Dist.] 1984, writ dism’d) (holding that failure to pay filing fee did not affect trial court’s jurisdiction and noting that, although clerk of court was authorized to refuse to accept case for filing if fee was not paid, “[i]f the clerk accepts and files the case without payment of the fee, the duty to collect the fee continues”). Other courts of appeals have also noted that “the payment of a filing fee ‘is not generally a prerequisite to jurisdiction, nor does the failure to pay such fees deprive the trial court of jurisdiction over a case.’” Nolte v. Flournoy, 348 S.W.3d 262, 268 (Tex. App.—Texarkana 2011, pet. denied) (quoting J. Allen Family Partners, Ltd. v. Swain, No. 04–09–00384–CV, 2010 WL 2103228, at *3 (Tex. App.—San Antonio May 26, 2010, no pet.) (mem. op.) and citing Kvanvig v. Garcia, 928 S.W.2d 777, 779 (Tex. App.—Corpus Christi 1996, no writ)); Tanner, 680 S.W.2d at 853; Advance Imps., Inc. v. Gibson Prods. Co., 533 S.W.2d 168, 169–70 (Tex. Civ. App.—Dallas 1976, no writ)).
   
In J. Allen Family Partners, the San Antonio Court of Appeals addressed an argument similar to Linda’s argument here, except that the trial court in that case expressly ruled on the counterclaims filed without payment of the fee. The trial court entered an award in favor of the defendant on his counterclaim for attorney’s fees after it had entered an order of nonsuit on the plaintiffs’ claims against the defendant. J. Allen Family Partners, 2010 WL 2103228, at *1. The plaintiffs argued that the trial court lacked jurisdiction to award attorney’s fees because the defendant failed to pay the filing fee for their counterclaims; thus, they argued, the defendant’s counterclaim was not before the court and the trial court’s order of nonsuit was a final judgment. Id. at *1, *3. The San Antonio Court of Appeals rejected the plaintiffs’ argument, concluding that the defendant “did not have an unconditional right to have the counterclaim heard if the fee was not paid, but the trial court had jurisdiction to consider and rule on the claim.” Id. at *3.
  
The Texarkana Court of Appeals reached the same conclusion in Nolte, when a trial court entered judgment in favor of a defendant on his counterclaim for attorney’s fees after the plaintiff filed a notice of nonsuit. Nolte, 348 S.W.3d at 268 (“even though a defendant does not have an unconditional right to be heard on counterclaims absent the payment of a filing fee, a trial court may, in its discretion, consider such counterclaims without payment of the statutory filing fee.”). Thus, courts of appeals generally have held that a trial court has jurisdiction over, and discretion to hear, claims that are conditionally before it—i.e., claims filed without payment of a filing fee. See Nolte, 348 S.W.3d at 268; Tanner, 680 S.W.2d at 853; J. Allen Family Partners, 2010 WL 2103228, at *3; see also Rodriguez v. Womack, No. 14-10-01213-CV, 2012 WL 19659, at *2–4 (Tex. App.—Houston [14th Dist.] Jan. 5, 2012, no pet.) (considering counterclaim in determining whether amount in controversy was within court’s jurisdiction even though defendant had not paid filing fee for counterclaim).
     
The Dallas Court of Appeals has also held that a trial court has discretion not to hear claims for which the party did not pay a filing fee. In re C.A.S., 128 S.W.3d 681, 685–686 (Tex. App.—Dallas 2003, no pet.). In C.A.S., the trial court entered an order dismissing the case after the plaintiff filed a notice of nonsuit. Id. The defendant argued that the trial court’s order was erroneous because he had filed a counterclaim for affirmative relief. Id. The Dallas court rejected this argument because the defendant had not paid the filing fee for his counterclaim. Id. It observed that, because the defendant had not paid the filing fee, his claims were conditionally filed, and he “had no unconditional right to be heard on those claims.” Id. at 686.
  
In sum, if Myrta’s motion for summary judgment was meritorious, the trial court would have been within its discretion to enter a final judgment disposing of the case without considering Myrta’s counterclaim or to enter an interlocutory order disposing of Linda’s claims only. We turn to the record to determine how the trial court exercised its discretion.
  
B.      The record does not establish whether the trial court intended to exercise its discretionary authority over Myrta’s counterclaim
  
The trial court’s summary judgment order is entitled “Order.” It does not state that it is final, contain any reference to finality or appealability, or employ the kind of customary finality language that will dispose of all claims and parties regardless of whether all issues are properly before the trial court on summary judgment. See, e.g., Bison Bldg. Materials, Ltd. v. Aldridge, No. 06-1084, 2012 WL 1370859, at *3 (Tex. Apr. 20, 2012) (“The order is not final because it does not contain finality language, state that it is a final order, or dispose of all claims and parties.”); Lehmann, 39 S.W.3d at 206 (noting that statement that judgment “finally disposes of all parties and all claims and is appealable” would dispose of all claims, even those not raised in summary judgment motions). It does not reference Myrta’s counterclaim, nor indicate that the court considered any relief other than that sought in Myrta’s motion for summary judgment. The order specifically identifies the filings the court considered as Myrta’s motion and Linda’s response, and it orders only that Myrta’s summary judgment motion “is in all things GRANTED.” Myrta’s summary judgment motion requests judgment on Linda’s claims against her but does not request relief on Myrta’s counterclaim. Thus, the trial court’s summary judgment order actually and expressly disposes only of Linda’s claims against Myrta—the only claims upon which Myrta requested relief. See Bison Bldg. Materials, 2012 WL 1370859, at *3; Lehmann, 39 S.W.3d at 206; see also Futch v. Reliant Sources, Inc., 351 S.W.3d 929, 932–33 (Tex. App.—Houston [14th Dist.] 2011, no pet.) (holding that summary judgment order was not final when it was titled only as order on motion for summary judgment, expressly granted only “Motion in its entirety,” and did not actually dispose of all claims).
  
Nor is there any indication elsewhere in the record as to the trial court’s intentions, if any, with respect to Myrta’s counterclaim. The trial court did not enter an order on Myrta’s motion to modify the summary judgment order. The trial court’s denial of Linda’s motions is equally consistent with an interlocutory or final summary judgment order. Although the parties make representations about hearings on these motions before the trial court, they did not file a reporter’s record in this appeal. We therefore have no record of what happened at the trial hearings. We generally may not consider events outside of the record. See Sabine Offshore Serv., Inc. v. City of Port Arthur, 595 S.W.2d 840, 841 (Tex. 1979); Bencon Mgmt. & Gen. Contracting, Inc. v. Boyer, Inc., 178 S.W.3d 198, 210 (Tex. App.—Houston [14th Dist.] 2005, no pet.)
  
Finally, it appears that the reason that the parties began treating the trial court’s summary judgment order as a final judgment in the first place is an entry on the trial court’s docket sheet indicating that a “Final Summary Judgment [was] Signed” by the trial court on the date of the order. This Court will not ordinarily rely on docket entries, and there is no basis here for concluding that the docket entry’s designation of the order as “Final” reflects the intentions of the trial court. See Daniel v. Falcon Interest Realty Corp., 190 S.W.3d 177, 188 (Tex. App.—Houston [1st Dist.] 2005, no pet.) (quoting Rush v. Barrios, 56 S.W.3d 88, 95–96 (Tex. App.—Houston [14th Dist.] 2001, pet. denied) for the proposition that “an ‘appellate court may not consider docket entries since they are only made for the clerk’s convenience and are usually unreliable’”); see also Miller v. Kendall, 804 S.W.2d 933, 944 (Tex. App.—Houston [1st Dist.] 1990, no writ) (“Generally, a docket entry forms no part of the record we may consider; it is a memorandum made for the trial court and clerk’s convenience. This rule results, in part, from the inherent unreliability of docket entries.”) (citations omitted).
   
We hold that the trial court’s summary judgment order is not a final opinion. We therefore lack jurisdiction over the merits of this appeal. See Bison Bldg. Materials, 2012 WL 1370859, at *3; Lehmann, 39 S.W.3d at 206.
  
Conclusion
  
We dismiss this appeal for lack of jurisdiction.

                                                                   Harvey Brown

                                                                   Justice

Panel consists of Justices Bland, Massengale, and Brown.

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[1]           According to Myrta’s pleadings, the parties discovered the encroachment when, shortly after Linda purchased the neighboring property, Myrta obtained a survey of her property for the purpose of installing a new fence.

[2]           Linda asserted that an efiling error had occurred with respect to her (untimely) summary judgment response, asking the trial court to reconsider in light of the response she had intended to file.

[3]           Linda later asserted that the trial court’s summary judgment was interlocutory as an alternative ground for her argument that the trial court should grant her motion for new trial and for leave to file late evidence.

Pro Se Appellant did not update his mailing address (or pay, for that matter). There goes the appeal…


Numerous appeals get dismissed because the appellant - for whatever reason - does not pay the filing fee, does not pay the court reporter, or does not pay the trial court's clerk for preparation of the appellate record (or a combination of these). The dismissal opinion in a case dissed today is routine, except for one additional twist: The unrepresented appellant apparently disappeared, or at least became unreachable. That too, can net dismissal.
 


MEMORANDUM OPINION ON DISMISSAL OF APPEAL

Appellant, [name omitted], has neither established indigence nor paid all the required fees.  See Tex. R. App. P. 5 (requiring payment of fees in civil cases unless indigent), 20.1 (listing requirements for establishing indigence); see also Tex. Gov’t Code Ann. § 51.207 (Vernon Supp. 2011), § 51.941(a) (Vernon 2005), § 101.041 (Vernon Supp. 2011) (listing fees in court of appeals); Order Regarding Fees Charged in Civil Cases in the Supreme Court and the Courts of Appeals and Before the Judicial Panel on Multidistrict Litigation, Misc. Docket No. 07-9138 (Tex. Aug. 28, 2007), reprinted in Tex. R. App. P. App. A § B(1) (listing fees in court of appeals).  On May 27, 2011, the Court notified appellant that the appeal was subject to dismissal if he did not respond within 10 days.  See Tex. R. App. P. 5 (allowing enforcement of rule); 42.3(c) (allowing involuntary dismissal of case).  The notice was returned as undeliverable.
  
A pro se appellant is required to keep this Court apprised of his current mailing address.  See Tex. R. App. P. 6.3(c), 9.1(b). 
  
Because appellant has failed to pay the filing fee and has failed to comply with the Rules of Appellate Procedure, we dismiss the appeal.  See Tex. R. App. P. 5, 9.1(b), 37.3(b), and 42.3(b), (c).  We dismiss any pending motions as moot.
 
PER CURIAM
 
Panel consists of Justices Bland, Massengale, and Brown.
SOURCE: HOUSTON COURT OF APPEALS - 01-11-00291-CV - 5/17/12