City Hall

Four Years Later, Jury Finds TCI West End Guilty of Fraud For Razing MKT Freight Station

On Monday I noted that city officials were anxiously awaiting a verdict in the 4-year-old case of City of Dallas v. TCI West End Inc., which concerned the demolition of the Missouri-Kansas-Texas Freight Station in the West End in '06. The trial started two weeks ago, and on Friday, city attorneys, two state assistant attorneys general repping the Texas Historical Commission and lawyers for TCI West End Inc. presented their closing arguments. One Friend of Unfair Park who attended the climactic showdown said all parties did a bang-up job, so much so it could have gone either way -- especially since the jury had about 30 questions to consider before rendering its verdict.

But the verdict's in: This morning a Dallas jury found TCI West End Inc. guilty of fraud -- that is, obtaining a demolition permit not for the historically protected building at Houston and Ross, but a "500 square-foot guard shack," and then leaving blank the box signifying their intentions to raze a historic building. The jury awarded the city $750,619 in civil penalties for not going through the Landmark Commission to get the demolition permit, a violation of the city historic preservation ordinance. The state gets $1.5 million -- $1 mil in exemplary damaged for the fraudulent conduct of obtaining the permit by fraud, and $500,000 in actual damages.

The property, incidentally, is no longer owned by TCI West End Inc. It's now in the possession of Dorbet Inc., which is not responsible for any of the damages awarded.

The City Attorney's Office is preparing a statement for release shortly, which is why First Assistant City Attorney Chris Bowers declined comment for now. But Katherine Seale, exec director of Preservation Dallas, tells Unfair Park this is a significant victory -- the kind that sends a message that "you don't violate the city's historic preservation ordinance and get away with it. It remains to be seen if the city or the state will receive any of the money awarded, but what's most significant is that the city will vigorously defend its historic preservation ordinance. Chris Bowers and the city attorneys who worked on behalf of this case are to be congratulated for not only pursuing the lawsuit, but for prosecuting to the fullest extent. They went after them for everything they could get."

Update at 4:28 p.m.: On the other side is a press release we just received from the Dallas City Attorney's Office concerning today's verdict. It also contains a comment from Mayor Tom Leppert: "The jury's verdict reaffirms the importance of the City's historic structures and the established processes that must be respected."

The City and Texas Historical Commission obtain important verdict; Jury awards damages for unlawful demolition of historic structure

The City of Dallas and the Texas Historical Commission today obtained a $2.25 million verdict against the former owner of the historic Missouri-Kansas-Texas (MKT) Freight Station for its unlawful demolition. "The jury's verdict reaffirms the importance of the City's historic structures and the established processes that must be respected," said Mayor Tom Leppert.

The building was located in downtown Dallas in the West End, which is both a city historic district and a district listed in the National Register of Historic Places. The 30,000 square foot brick building was built around 1925 and was a key part of Dallas' emergence as a rail center. Testimony at trial showed that a consultant told Transcontinental Realty Investors, Inc. that it needed the Dallas Landmark Commission's approval to demolish the building. Thereafter Transcontinental set up a single-asset subsidiary, TCI West End, Inc., and transferred the property to it in February 2006. TCI soon gave the City an application for a demolition permit, describing the building as a 500 square foot structure and not checking the box to indicate it was a landmark. A city plans examiner relied on the application when issuing the permit.

When city officials discovered the permit had been issued, they immediately called two demolition contractors hired by TCI and verbally revoked the permit. However, TCI found another contractor, who demolished the building in April 2006 without Landmark Commission approval or a proper demolition permit.

The City sued TCI in May 2006. The Texas Historical Commission, represented by the Attorney General's Office, joined the lawsuit a few months later. At trial, the City and the Commission sought actual damages, exemplary damages, and civil penalties for the unlawful demolition. After a two-week trial before State District Judge Jim Jordan, the jury awarded the Commission $500,000 in actual damages and $1 million in exemplary damages. The jury also awarded the City $750,000 in civil penalties. In addition, the jury found that TCI obtained the demolition permit through fraud. City Councilmember Angela Hunt was pleased with the verdict: "Hopefully the jury's verdict will discourage others from unlawfully demolishing historic landmarks."

The City and the Commission will soon ask the judge to sign a judgment in their favor based on the jury's verdict. City Councilmember Pauline Medrano appreciated the State of Texas' help with this case: "The City of Dallas is grateful that the Texas Historical Commission and the Attorney General's Office recognized that this unlawful demolition of a historic treasure could not be tolerated. The State's help has been invaluable in this case."