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Texan Able to Develop Land After 10 Years of Litigation
 After a tough 10-year legal battle, a Texas developer has secured the right to develop most of his property as he had originally planned.
Gary Sheffield, a Fort Worth and Dallas developer, recently reached a settlement agreement with the City of Glenn Heights, which had sought to stop or significantly alter his plans to build a large master planned community there, about 20 miles south of downtown Dallas.
“This was not easy, and litigation is not for the faint of heart,” Sheffield said. “I hope other builders and developers will learn from my experience just how important it is for an individual member to have a wide range of support during complex and time-consuming litigation.”
Glenn Heights initially attempted to forestall Sheffield’s plan to build the community by imposing a moratorium on any development on his property. The city never gave Sheffield notice of the moratorium, and it did not have to under then-existing Texas law. The city then down zoned the property, reducing the number of units that could be developed on it by 50%, and Sheffield challenged this as a regulatory taking.
The city put the moratorium in place so that it could down zone the property, despite assuring Sheffield before he purchased the property on its acceptable use based on existing zoning.
Sheffield prevailed at a state trial and in an appellate court, which found that the city’s down zoning was, in fact, a regulatory taking of his property because he was deprived of his investment-backed expectations. The Supreme Court of Texas disagreed and held that the economic impact of the city’s actions, though substantial, did not rise to the level of a taking.
The imposition of a moratorium without notice, however, remained an issue. Sheffield had filed a plat to vest his development rights after the city neglected to seek a permanent moratorium when the temporary suspension expired, and the high court remanded the case on this issue.
Glenn Heights officials recognized that Sheffield’s development rights had vested and ultimately agreed to settle the case. After 10 years of costly legal wrangling, Sheffield secured the right to develop his property largely as he intended, although with fewer units in a compromise with the city.
Sheffield’s perseverance has led to changes in the property rights law in Texas. State legislators found the idea of a municipality imposing a moratorium without notice so troubling that they added a notification requirement to the law.
“This case and the legislative changes that resulted from it demonstrate how important it is to ensure that municipalities are required by law to provide proper notice for decisions that could have enormous financial consequences to an individual builder or developer,” Sheffield said.
The case, Sheffield said, also illustrates the importance of industry support in enabling an association member to pursue such lengthy, costly and hard-fought litigation. Financial support was provided by NAHB, the Texas Association of Builders, Greater Fort Worth Builders Association and the Home Builders Association of Greater Dallas, and NAHB filed an amicus brief in the litigation.
Without this assistance and emotional support “from someone on the same side,” it would have been difficult to continue the litigation, he said.
For more information, e-mail Blake Smith at NAHB, or call him at 800-368-5242 x8583.
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