City of Austin v. Casiraghi
In City of Austin v. Casiraghi, 656 S.W.2d 576 (Tex. App.--Austin 1983, no writ), the City sought to acquire by eminent domain three lots, in their entirety, on which the owners operated a restaurant. See 656 S.W.2d at 578.
At the trial, the owners stipulated to the value of the real property, but then sought to establish the value of their restaurant business independently of the value of the land upon which it was operated. Id. at 578-79.
The owners contended that "the restaurant could not practically be relocated elsewhere" and, therefore, the taking of the real property destroyed their business. Id. at 579.
On appeal, the Court recognized that no recovery for the loss of the business could be had under the eminent domain statutes, since the whole of the owner's land was taken. See id. at 581.
In addition to the City's statutory action, the owners asserted a right to bring a "constitutionally-based claim independent of the eminent domain statutes," as AVM attempts to do here, arguing that "the value of [a] business may be ascertained and recovered as an independent element of damages in a separate constitutionally-based right of action, where the City sought neither title nor possession of that business in its pleading." See id. at 579-80.
The Court expressed no opinion on the viability of the owners' constitutional claim, however, because the owners had failed to allege a separate cause of action reflecting that claim in their pleadings. See id. at 580.
In sum, the owners stipulated to the fair market value of the land and improvements thereon, including their restaurant, then presented evidence of the market value of the business apart from the land and improvements as damages recoverable in a statutory condemnation proceeding. Id. at 578.
The jury found the landowners' business was taken by the city and the market value of the business excluding the land and buildings thereon was $130,000. Id. at 579.
The court of appeals reversed the trial court's judgment awarding those damages for several reasons, including that there were no pleadings to support a claim for damages to the business independent of the owners' right to recover the market value of the three lots condemned by the city. Id.