State Supreme Court Hears Hays Street Group’s Case

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The Martinez family walks towards Hays Street Bridge.

Scott Ball / Rivard Report

Neighborhood residents walk on the street adjacent to the Hays Street Bridge.

AUSTIN — Attorneys for the City and the Hays Street Bridge Restoration Group appeared before the Supreme Court of Texas on Thursday, offering arguments on whether the City could use government immunity as a defense in a 6-year-old breach-of-contract lawsuit.

The Restoration Group, in the 2012 suit, claimed the City violated a then-decade-old memorandum of understanding (MOU) and State law by selling land at 803 N. Cherry St. to the venture that owns Alamo Beer Co. The land has since been sold to local developer Mitch Meyer, who intends to build a multistory, mixed-use apartment complex there.

According to the group, the MOU stated the 1.7-acre property would become a public park as part of larger efforts to preserve the historic Hays Street Bridge. The hearing also was to determine whether the City's claim of government was still valid since the group is seeking to have the contract invalidated instead of monetary damage.

A Bexar County jury in 2014 decided the City had violated only the MOU when it sold the land. In 2017, the Fourth Court of Appeals overturned the ruling stating the City was immune from being sued for breach of contract. The Restoration Group took its appeal to the Supreme Court.

In August, the City filed a motion to dismiss the Restoration Group’s case, asking the State Supreme Court to find the matter moot. The property sale is not an issue before the court and will not be affected by its ruling.

The City's legal team contended the City carried out all requirements in the MOU, which included applying proceeds from the land sale toward bridge restoration.

Attorneys for both sides said they do not expect an opinion from the State Supreme Court for at least three to four months.

About 50 members and supporters of the group, nearly all residents living near the bridge, went to Austin to witness the proceedings.

The Restoration Group's attorney, Amy Kastely, told Supreme Court justices Thursday that the motion to dismiss rests on "very flawed legal arguments" from the City.

One such argument, Kastely claimed, is that the City wrongly interprets the appellate court's decision, which includes that the City has done all that was spelled out in the MOU.

"We're entitled to have the judgment be interpreted as any contract or any other piece of legislation would be interpreted," Kastely said.

Edmond Ortiz / Rivard Report

Amy Kastely, attorney for the Hays Street Bridge Restoration Group, addresses group members and supporters following a Supreme Court of Texas hearing in Austin on Thursday, Sept. 13, 2018.

Kastely argued the City agreed in the MOU that the Restoration Group would be responsible for raising funds and other resources to benefit the preservation project, including maintaining 803 N. Cherry St. for future park space. This, Kastely added, would be done to positively impact the wider community.

"The primary purpose of the [Restoration] Group is to preserve and maintain the Hays Street Bridge for the purpose of educating the public and preserving community identity," Kastely said.

"The Hays Street Bridge is an engineering monument, as well as a cultural monument for San Antonio's East Side, a traditionally African-American part of San Antonio."

Mike Truesdale, one of two attorneys speaking on the City's behalf, contended the City had met its obligations per the appeals court's ruling.

Truesdale said any and all money raised as part of the restoration project — including the land sales proceeds — be applied toward restoring the bridge, regardless of who raised the money.

Truesdale added, however, this case had nothing to do with the notion that any of the property was to be reserved as future park space.

"Claims in this case that involved use of the property as a park were denied by the jury," Truesdale said. "The property was not owned, used, or held as a park."

Truesdale said while the City feels it has met its obligations, the City also wants to settle its claim to governmental immunity in this years-long dispute with the Restoration Group.

"We wanted a judgment on that, we wanted it taken care of," he said. He added if the Restoration Group seeks some kind of relief in the case, there is none to be had.

"If this court reverses the immunity ruling and sends this case back, what else is to be done?" Truesdale rhetorically asked.

The adjacent vacant property was subsequently sold and now is the proposed site for a controversial apartment complex that some Dignowity Hill residents say would further gentrify the neighborhood and ruin views of the bridge.

Edmond Ortiz / Rivard Report

Supreme Court of Texas Justices Jeff Brown (left to right), Eva Guzman, and Chief Justice Nathan Hecht listen to oral arguments from Dan Pozza, attorney for the City of San Antonio, in a hearing on the Hays Street Bridge Restoration Group's case in Austin on Thursday, Sept. 13, 2018.

Dan Pozza, another attorney for the City, added that the MOU contained the idea that the area around North Cherry would and should be made attractive for development in the future.

"The one thing that the [Restoration] Group can't say, is that they can't claim surprise or shock that there'd be residential development on the land adjacent to the bridge," Pozza said.

In the case of whether the City can claim government immunity in the land sale, Kastely later told reporters "the trick is to figure out whether the City was being a government or if they entered the contract as a corporation."

Kastely added while monetary damages cannot be sought, the only other relief that could be gained is to preserve the rest of the disputed property as future public land.

"The group was injured because they didn't get what they were promised," she added, referring to preserving the land for public use.

If the State Supreme Court rules for the City, the Restoration Group's claim to breach-of-contract ends.

But Kastely said she's confident the group and its supporters would keep opposing the planned five-story mixed-use development, which would include a small public pocket park next to the bridge.

"I'm sure there will continue to be community protests," she added.

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