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CF-Deforest LS-CS 970421WOLFE, CLARK, HENDERSON & TIDWELL, L.L.P. 123 N. Crockett St.~ Suite 100 (903) 892-2397 (F~) TO= Mr. Jim Witt Hr. Ken Griffin FRO~: James Corley Henderson NUMBER OF PAGES (Includln~ this cover): 11 PEIt~ON OPERATING FAX~ Pattie Trott OUR FILE NUMBER= O~ FI~ N~: Turner v. city of coppelL ~ENT ~SMI~ED: ~tter and Award of Arbitration attorney prl¥11eged and confiden~ial in~orma~Lon in~ended £or the use of the individual or en~i2y named above. If the re~der of ~hi~ mes~e is not the intended r~ciplent~ or the distribution or copying of this information is strictly prohibited. If you have received this fax in error, please i~ediately notify us by telephone, and return the original Po~tal Se~ice. 84/28/97 23=42 002 WOLFE, CLARK, HENDERSON & TID%VI~LL,!L.L.P. A1T¢~NF. Y5 & CO[IN.~ELOR5 (l~O~-tgvl) ~! IE~, TE~ 75090 aoN C~ April 21, 1997 Ms. Tiaa Lee Claims Management Specialist TeXas Municipal League Post Office Box 149194 AUStin, Texas 78754 Re= Shelley D. Turner v. city of Coppell, e~ al Cause No. 96-02859, Dallas County (192d DiSt.) TML Claim No. 9500025207/2 Dear Tina: I am enclosing the Award of the arbitration proceeding in this case, which I received Friday aft=moon, April 18. The arbitrator found that the DeForest Lift Station did cause a nuisance, and the Award orders the city to pay to the plaintiff, Shelley Turner, the sum of $21,Z50. This amount will be due within 30 days of the date of the Award, which is April 18. Needless to say, the ultimate finding of this Award is quite a surprise. I believe that th= result is particularly surprising taking into account the oth~r findings in the Award~ which does not find liability against an~ of the other defendants, and which the existence of and smells emitting from the lift station prior to closing on her home. The Award also states tha~ the plaintiff failed =o produce evidence of damages related to "traditional time aZ sale differential value," paragraph 8, but that the plaintiff's offer of proof identifying "impaired appreoiation in value" is an appropriate proof oS nui~al~e damages, paragraph 13. I gave you u brief o¥~rview of the evidence When we spoke on the telephone last week, b~t, in light of thl~ Award, I want to give it to you in a more complete fashion. WOLFE~ CLAR.I(, HENDER~ON&.TIDYN'ELL,!L.L,P. Ms. Tina Lee April Zl, 1997 Page 2 The arbitration proceeding began at approximately 9;00 a.m. Evidence and witnesse~ w~z'e called until approxinlately 7:00 p.m. Arguments were presented until approximately 8:30 p.m., at which time the arbitration proceeding was concluded. ThB arbitration was attended by the following parties: Plaintiff, Shelley Turner, and her attorney; the Builder Defendants--mlrkdale Homes, Inc.; Dob D~lsanter, Jim Siepiela, Mark Siepiela and G~orge Davis, and their attorney; the Developer Defendants--Tom Wise and wi~e=o, and their attorney; and the City, represented at the hearing by City Engineer/Assistant City Manager Ken Griffin, and myself. Eaoh of the individual party witnesses tmstified at the hearing. Generally, the testimony elicited was that the lift station emitted an odor in the summer and fall of 1993, which was the time period when the homes close to the lift ~tation were under construotion. The plaintiff testified that ~he no=i~ed the but was assured by the individual builder defendan=~ that this was a "fresh water" lift station, and not a wastewater lift station. The smell was very bad in 1993, but improvements were made to the lift ~tation, and the ~mell5 were reduced in freciuency and intensity. Everyone a~reed that the smells are no~ bad now, and a number of witnesses testified that there is absolutely no odor a~o~iated with the lift ~tation at present. Shelley Turner testified that ~he ha~ not noticed an odor since the summer of 1996, and at that time it was only occasional. Turner also testified that prior to the summer of 1996, there were times when she was embarrassed by the smell, and that she has not invited people over to herllume because she ha~ been afraid that the smell would be bad. Testimony was also elicited that the Pr~)=ct Agreement required that the subdeveloper, Wise, require that the builders give notice of the lift station to all homebuilders within 400 feet of the lift station. E¥ideuce was submitted that the City was given written assurance that this had been done. Other witnesses called during the day were: Steve HC~/ghton, who resides at 657 DeForest. Houghton's testimony related ~o when the plaintiff first learned that tBis was a sewage lift station. He testified that she appeared alarmed at the MUD Board meeting in Deue~uel' of 1993 wll~n she learned that this no% a "fresh water" lift station, but ~ wa~tewatu~ lift station. Regarding the odor, Houghton testified that "back then", referring to the construction time period, which was the fall of 1993, the smell would "come and go." Houghton testified that there i~ no 04/20/9? 2:3: 42 00,4 WOLFE, CLARK, HENDERSON&TIDWELL, L.L.P- Ms. Ttna Lee April 21, 1997 Page 3 odor at present. Earl and venida Hudley, who li¥~d acros~ the street from TUrner, but who Lave since moved to Georgia. They testified that the smell was bad during the summer and fall of 1993, and that it never got any better by the time they moved. Luis Ramos and Steve Jones, who al~o live within 400 feet of the lift station. Ea=h of 5h~se two homeowners testified that the smell has been eliminated, but that it was bad during the construction period. They testified that Shelley Turner knew that this was a wastewater lift ~tation prior to ¢losimg on her home. Beverly Debbs, who was an agent for a company to which Tom Wise had given the assignment of obtaining written noti~e from all of the homeowners who purchased homes within 400 feet of the lift station. Ms. DebbS testified that she sent written instructions to a number of closing companies, along with proposed notifications, which were to be signed by each of tile homeowners at closing. However, either Ms. Debbs did not transmit these instructions to the clo~ing company whicl~ clo~ed the Turner property, or the closing company failed to use the uorreu~ notice form in obtaining Turner's signatures at The damages evidence was presented by the plaintiff~s expert, W. M. McClellan. Basically, McClellan testified that he performed market analysis and determined ~hat Tamer's home is worth $Z5,000 less because it is located across the street (86 ft.) from wastewater lift station compared to what it would be worth if the lift ~tatiul] wa~ not tl~re. On cross examination, McClellan admitted that in the five times he was in the neighborhood he never once ~melled any bud odor, that he never ~poke with anyone other than the plaintiff who reported amy odor, that he never spoke with anyone from the city regdrding whether there ha4 been any odor complaints, and that his te~timomy regarding the prope~ty~ value was not based upon the existence of odor, but upon the existence of the lift station. There was also evidence presented regarding the litigation over the Pro~ect Agreement which occurred between the developer, wise, a~d the city. The plaintiff did not really articulate this argument, but some of the que~tion~ ~r~nted by the arbitrator suggest that he may have believed that the question of notice to residents, and the liability for not obtaining written notice of the pre~ence of the lift station, should have been or was in fact resolved in the settlement of that Wise v. City of Coppell lawsuit. You may recall that that lawsuit was settled upor~ an agreement that the City would withhold from the developer a ~um of money because WOLFE, CLARK, III~NDERSON & TIDWI~LL, L,L.P. Ms. Tina Lee April 21, 1997 Paqe 4 ho had not given the notice required by the Projec~ Agreement. I am not exactly sure of the precise amount withheld from %h~ developer because he £ailed to obtain the appropriate written Notice, but I am fairly certain that it was in excess of the $21,250 given in this Award. In other words, it ~ppears from the Award t~at the arbitrator may have seen in that settlement a recovery by the city against wi~euo for failing to give notice, and thought it appropriate that the city should perhap~ devote some of that money to compensate this plaintiff for the nuisance caused by the lift station. I cannot say that this r~solution is totally without some logic, if you loo~ at it in ~his way. As mentioned above, this argument was never really articulated by the plaintiff, or, indeed by any party in ti%is case, and I did not really appreciate it until this Award. For my part, the primary argument which I presented was one of estoppel. In other words, our position was that the lift station was open and obvious to the plaintiff when she purohased her home, that she was perfectly within her rigt%ts to purchase a home across the street from a lift station, but, having done so, she should not be allowed to recover for a nuisance which she knew woul~ exist. In fact, the plaintiff admitted a~ much on ~ros~ examination, as did her expert witness. The evidence in the record was that the plaintiff never contacted anyone with either the ~4~JD or the City regarding the true nature of the lift station, and that, had she done so, there was every indication that ~he would have been given every detail about it. There was really no way to argue that there was never a smell associated with the lift station, but the argument was made that whatever problem existed ha~ been adequately addressed, and that the lift station is funutioning at an optimum level aS far as the emission of odor is concerned. Overall, my ~eeling is that the arbitrator wanted to find some way to gxve the plaintiff an award, and simply identified the party which was best able to bear the cost. There was ~vidence which was essentially undisputed that the lift station caused some odor in the late 1993, early 1994 time frame, and the arbitrator apparently felt that this justified an award against the city, particularly taking ~nto consideration the prior settlement Of the "notice" dispute in the Wise v. city of coppell lawsuit. I think that there are certainly some contradictions in the findings that the plaintiff knew about the lift station and the mmells prior to closing on her home and the finding that she may r~cover for a nuisance. 006 WOLFE, CLARIr~, HENDERSON & TIDWELL, L.L.P. Ms. Tinai Lee April 21~ 1997 Page 5 ~ro~ another perspective, tl~e plaintiff's claim for damages against all defendants was in %he $250,000 range, which included mental anguish type damages, plus attorneys fee~ of approximately $50,000. Moreover, the builder and developer defendants were pressing cross claims for a~torneys fees against the plaintiff in the range of approximately $75,000 each, most of which remain unpaid. In s~m, it appears to me that the arbitrator may have seen this result as something of a compromise. Dy copy of this letter, I am transmitting the Awar~ to thoss listed below. I ask that everyone pleaso feel fre~ to con~aot me if I may provide any further information at this time. I will keep yOU informed Of subsequent developments. Sincerely, ley Henderson JCH/ Enclosure pc: [with enclosure] Mr. Peter G. smith TELECO~Y TO ~2~4~ 965--Q0~G Nichols, JaCKson, Dillard, Ha~er & Smith 1800 Lincoln Plaza 500 North Akard Dallas, Texas 75201. Mr. Jim witt Mr. Ken Gri££in ~ND. BY ~EGU~R~M~IL city Of Coppell PoSt Office Box 478 Coppell, Texa~ 75019 00? 04×20/~? 2~:44 -~ 96-02859 S~ELLE¥ D. TURNER, ~ IN TME DISTRICT COURT OF Plaintiff, § vs. § DALLAS COUNTY, CITY OF COPP~LL, TEXAS, mn its § capa¢$~y am a municipality, § and as Successor of § COPPELLM~XCIPAL UTILITY DX~TRICT NO. 1; WIS~CO LAND § DEVELOPMENT, INC.; § TOMMY C. WISE; § B~ENTWOOD BUI4DERS, INC,; JAM~$ A. SIEPIELA; ROBERT D~ART~K; MARK SIEPT~LA and GEORG$ C. DAVIS, § De;~endanus. § 192ND JUDICIAL DISTRICT ~ ~Gordance w~h the parties' a~r~en% for submission tO Binding Ar~&=ra~lon, S~LLY D. TURNER as Plain=iff and THE CITY 0~ COPPELL, TEXAS, WIS~CQ LJ~ND DSV~LO~MENT, INC., TOMMY C. wISE, BR~NTWOOD BUILDERS, INC., BIRKDALE HOMES, INC., JAM~$ A. $~PIELA, MARK R. SIEPIELA, ROBERT DELSANT~R, AND G~OKG~ C. DAVIS, e~ch as De:endan%s submitted ail disputes ~o Arb£t£'ation before F~%RLAN M3%RTIN, a¢=&~ ~S =he sole Arbitrator. FOllowing a full and complete hearin~ O~ all testimony, documen~a~io~ and argument of coun~l, =his Award is i~sued in ~%nal resolution o~ all claims between the par=ies, including any a~uorne¥'s f~es, co~ or ~nter~st. HA~LAN MARTIN, as %he ~art£es' ARBITRATOR finds and 008 04/20/9? concludes aB £ollows: 1, Pl~lntl~ ~Ld defendant~ Btrkdale a~d SrentwOOd have warranty" disputes. HcweYer, plaintiff re=nine all a~d this se:element in n~ way limlt~ pla~nuiff's righ~ ~o claims aga~.nst HOW. 2. Plaintiff's =laim$ again$~ individual defendant Tommy C, wi~= ~r~ without merit and are denied. 3. The Pro~ec% A~reement between de£endant WISECO ~efend&n~ ciuy o~ coppell, by it~ ~erm~ and ~h~ clearly kn~en5 o~ 5he cont~acninF part~e~, ~cludes any potential for ~hird party benefzciary claims. Therefore plaintiff claims a~ains~ defendant WIS=CO ~' de~endan5 City ~ Coppel%, for breach of con%rac~ are without msriu and are denied. 4. Any duty undertaken by de£undan~ w~$~CO under party. To the extent delendan% City o~ Coppell would require City of Coppell, the City reserved %o itself any right~ to enforce, waive oz' modify any performance required of de£end&n= WI$~CO. 04/20/97 23:44 ~ 00~ Arbitrator Zind~ that w~$~CO acted reaeonably in its e~forts to perform "i~ giving of wriuu~n notice" a~ required by the Projec~ Agreement. T~ereZore, Diaintiff'~ ulmims a~ainst defendant WISECO The ArDitrator finds no evidence %~ ~upport Plain~Z~f's claims o~ al%er e~o, single business en=er;ris~ or ~rans~r of assess in fraud of creditors or ~his plain%i£~. Therefore, all of wlainuiff's claims aga~nsu de~nd~n: Bren~woo4 6. Plainziff purchased her home mt a bargain price, comslderably u~der mark~% valuu. Plaintiff wae offered a return o~ ~nds ~O~ tO close and =ermina~ the purchase con~ract. ~laintif~ Ov~rwrQ~e and modified ~he "Termir~a~ion-liqui~at~d damage" clause of the purchase con~racu and could noZ have been mislead by any ar~bi~ulsy in ~he builders o££~& %Q return funds. Plainti~ appreciated the bene£i%s of her bargain, was motivated to close the purchase con~racu and declined the opportunity =o =ermina~ the 7. prior to ~xecusin~ the purchase contrac~ an~ again emiuuing from t~e 1t:% station. The smells were rank an~ offensive and could be reGognized as sewage. 8. plal~%~i~f's "mazke5 value" e~per~ has iden~ified damages as~ocla=ed only wit~ ~n impaired poSen=ia! of =he property 04×20×9? 2~: 45 .... 010 %Q appreciate in value. There is no.Loafer ~f proo~f of traditional ~im~ ~£ sale di~fez~ia!_valLL~. 9. Therefore, for reasons sta~e~ in ~indin~s 6, 7 & 8, above, the Arbitrator ~inds ~hat Plain=if£'s cla~m~ de~end&~=$ BirKdale, James Slepi~la, Mark $iepiela, Dele&near and Davis for trauO, constructive fraud, misrepresen~azion or violation of %he DTPA are without meriC and are denied. IQ. Plaintiff, Dy stipul=cion, has abandoned all claims against the city of Coppell ~or negligence or inve=se condemnaCion. I1. The CMUD or the City of Coppel% has operated ~h& De~ore~= Litt Station az all relevant times and %he city o~ Coppell ~y reason of its absorption o~ ~he CMUD l~ legally responsible for any damages recoverable by 3rd parcle~ caused by operation of the lift station. 12. On several occasions between Se~ccmber, 1993, and April, 1995, failures in che o~racion0 ~,~intsn&nce or design of the lift s~ation allowed the generalized escape of rmnk and oi~ensive smells %o encroach on ~lainti££'s property and significantly and adversely e~fect her use, unjoy:nen% and pz-operty rights. Followin~ SepSember, 1993, and un~il r=aso~ably abated by May, 1995, escape a~d encroachment of offensive sewa~ smells was Ca~sed Dy defendant City o: co~=l!'o zngen~ional £ailure to employ available and reasonable equipment and proccdur¢~ in l~m operation and maim~enance u~ the lift 13. Plaintiff's offer oi pz-oo~ identifying · 04×20×9? 23:45 ~ 011 '4, appreciation in value i~ an appropriate proof of nUisanCe damages. 1~. 'the Arbitrator finds cha& Plaintiff hms suetalned demages caused by a nuisance in=en=ion~lly ~uffer~d and a~low~ by def,ndanU The City Of Damages ar~ £~u:'~d to be the to, al su~ of ~wenty-one %~Q~nd, two hundred and '~fty dollars ($21,250). ~e~en~an~s WISECO, Tommy W~se, Birkdale, Br~ntwood, James Mark $iepiela, DelsanDer and Davis. Plain~lf~ is awarded. __.~he. . total._ sum of $21,250 against The City o~ Coppell. All claims not ~pecl~lcaily awarded In £avor o£ Plain~if~ All claims for a~orn~¥s £~ or co,cs stated by any party are denied and each party ~hall pay =heir own a~torney's and Post award intcz'esD at ten percent per annum {10%) shall accrue Qn 91aintitt's award beginr, ing ~he 31s= day following date. Def~ndan~ City o~ Co~ell ~hal! pay Plaintiff the total s~ o~ $Z1,~$0 within 30 days, in £ull satisfaction of thi~ award.