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2014-09-18

City litigation settled - no alleyway, never has been

By Judith Pannebaker BCC Editor

Pictured: For years, litigators working on behalf of the City of Bandera argued that a boutique, owned by Stella Tedesco and located inside the 11th Street Cowboy Bar, had insisted that Harleys and Horses had been constructed on a so-called "public alleyway" that ran vertically through the entertainment venue from 11th Street to the back of the property. After two years of spending taxpayers' money on the litigation, the city finally admitted defeat on July 8.

Stella Tedesco and James McGroarty



Believe it or not, the books are finally closed on the infamous Alley War waged by the City of Bandera against businessman James McGroarty, owner of the 11th Street Cowboy Bar. And, judging from the outcome, the city seems to be wiping egg off their collective face(s).
After its beginning in 2012, the brouhaha came to an official - and unaccountably quiet - end on July 8 when a "declaratory judgment to quiet title" on the so-called alleyway was filed in the 216th District Court.
However, at the conclusion of a March 20 executive session, city council announced that protracted litigation over a by-now-proven non-existent alleyway, purportedly located somewhere within the confines of Bandera's popular entertainment venue, had been settled. At that time, Mayor Don Clark had apparently signed the agreement.
It was also announced that no public comment would be forthcoming until the signatures of former councilmen, Maggie Schumacher, Nancy Montgomery, Binky Archer and Brandi Morgan, as well as that of McGroarty, were also affixed to the legal document and it had been accepted by the court.
'Public' comment
Now, five months later, the city's public comment on the settlement is as follows:
"The City of Bandera is pleased to announce that the parties have agreed to settle all issues in connection with a lawsuit filed by Bandera businessman James McGroarty in response to ten (10) citations issued by the City of Bandera. The resolution is amicable and allows all parties to avoid the cost of further litigation.
"This agreement establishes a new beginning, and the City looks forward to a collaborative, productive relationship with Mr. McGroarty, a valued business owner in the City and a valued member of the community."
Interestingly, McGroarty's attorneys, Fred R. Jones and Cynthia Cox Payne, had to add the phrase "in response to ten (10) citations issued by the City of Bandera," to the public statement, which Mayor Clark has never really stated publicly. Given the number of citations issued, the amount charged by the city per day and the protracted litigation, McGroarty could possibly have owed the city $3,650,000 in accumulated fines and penalties. That figure is based on an assessment of $5,000 per day, coupled with two years of litigation.
McGroarty's legal team also included Allen Cazier and KH "Kerry" Schneider.
Additionally, the State's motion to dismiss all citations "in the interest of justice" was filed in municipal court on August 4 by then-city prosecutor Zachariah Evans and signed by Judge Frances Kaiser.
Throughout the drawn-out process, city officials allegedly exhorted McGroarty simply to pay the fines, which, in turn, would lead to the city's claim regarding the alleyway "to go away." However, McGroarty refused to pay up as allegedly requested because he would essentially be admitting guilt in the matter and therefore cloud his title to the property in question.
'Alley War' backstory
The Courier covered the "Alley War" extensively from April 2012 to the first utterance of a settlement in March of this year.
In the April 12, 2012 edition, then - City Administrator Mike Cardenas was quoted as saying "We don't think it's a city alley. In over 20 years, it's never been maintained." Then-municipal attorney Barbara Boulware-Wells advocated abandoning or vacating the property. No document, she said at that time, had surfaced that indicated how the alleyway had been created in the first place. However, Boulware-Wells' tune apparently changed after the late Mayor Horst Pallaske allegedly turned management of the lawsuit over to her and the then-city secretary.
Also clouding the issue were recollections of long time city residents who recalled, "wagons traveling up the alleyway" to a blacksmith shop because "it was the only access they had." And, those recollections apparently became the crux of the city's argument. The city purportedly relied on residents' memories rather than metes and bounds for proof an alleyway actually existed.
The question of an alleyway on the premises of the 11th Street Cowboy Bar first surfaced in 2003 when Stephanie Logue wrote an article, titled "11th Street Cowboy Bar gets the boot," for the now defunct Bandera Review. At that time, city council had refused a request from then-owners, Susanne and Eldon Reed, for a variance for a women's restroom supposedly constructed in a city right-of-way. The port-a-potties had apparently been installed in the vicinity of a present boutique marketplace within the entertainment complex.
'Property is mine'&
city's response
During the April 2012 meeting, McGroarty told council he had purchased the property in question from Alfredo Arizola for $137,000. "We went through the due process of the law," McGroarty said. "This discussion is moot. The property is mine."
An article published in the Courier on April 26, 2012 traced ownership of what the city referred to as an alleyway. The property was sold to Domingo Arizola and his wife, Valeria, on Jan. 12, 1978. On May 19, 1995, Domingo Arizola appeared to have transferred the tract to his son, Alfredo V. Arizola, a resident of Humble.
It was later revealed that Alfredo V. Arizola and his brother Domingo Arizola Jr. had actually acquired title to the property by means of adverse possession and a Final Judgment in Suit to Quiet Title from the 216th District Court in Bandera and signed by presiding Judge Stephen Ables on Nov. 2, 2011.
As reported in the July 5, 2012 edition of the Courier, Boulware-Wells sent McGroarty a hand-delivered letter on April 24, addressing building code violations and encroachment on the "alleyway" inside his bar. She referenced "various buildings built either by you or on your behalf (that) are encroaching on the public alleyway that is between Mr. Hart's property and the property formerly owned by Mr. Arizola and now apparently owned by you."
As a result, Cardenas was reportedly instructed by Pallaske to issue a total of 10 citations to McGroarty - four for alleyway obstruction, four for violating setback distances and two for failing to obtain building permits. These citations were predicated on the structures encroaching upon and-or obstructing what was referred to as a "public alleyway" that ostensibly ran vertically through the 11th Street Cowboy Bar from 11th Street to the back of the property.
Legal description error
In turn, McGroarty's attorney Cazier filed a motion to quash all citations issued by the City of Bandera, opining, "The mistaken belief that such an alleyway exists is based upon an error made in a deed's legal description well over 100 years ago, long before Bandera was an incorporated city." Cazier also considered the citations filed by the City of Bandera as "an unlawful taking of (McGroarty's) property without due process of the law and without adequate compensation."
Foreshadowing McGroarty's eventual lawsuit, Cazier also noted that if a governmental unit acts intentionally, it is deprived of governmental immunity when that government takes property - even if it believes it has title to the property. Had a court agreed with Cazier's contention, liability insurance provided by the Texas Municipal League would not have protected public officials and council members would have been personally liable because they had acted "without legal or statutory authority."
Not surprisingly, on Friday, Sept. 28, 2012, McGroarty's attorney Fred R. Jones filed a lawsuit against the city and city council. Jones represented McGroarty on behalf of Western Title of Bandera, the company involved in the sale of the disputed alleyway. Councilmen were sued in both their official and individual capacities.
Litigation gets
personal?
In court documents, Jones noted that the city's claim to a public alleyway across McGroarty's property is unsupported by any documentation - whether through dedication to the city for public use or acquired by the city via public domain.
At this point, litigation stalled for two more years due to ever-changing casts of city councilmen and municipal attorneys, all of whom had to be repeatedly "brought up to speed on the lawsuits."
Also during this time, it was ostensibly reported that a councilman refused to settle because he allegedly "didn't want that bully (McGroarty) to win." Other council members also purportedly suggested changing the city's sound ordinance to make it more difficult for McGroarty's outdoor venue to adhere to the law. Apparently, an attorney put the kibosh on this suggestion, informing the councilmen that such an action could be considered "retaliatory" in nature.
In a Hail Mary play, the city also attempted to contend the bar's elaborate outdoor stage had been constructed without proper permits. However, McGroarty produced his copies of the required documentation, including engineering plans and permits signed by former Mayor Denise Griffin. According to reports, the city apparently had misplaced their copies - and there was reportedly no record of the money McGroarty paid for the necessary permits.
Waste of
taxpayers' $$$
In the end, however, a looming trial date and the hiring of a new law firm ended the litigation that had, by all accounts, split the community and created a toxic atmosphere for business in Bandera. McGroarty did not receive a monetary settlement; however, the city dropped the citations with alacrity. "I'm just glad to see an end to the waste of my and the City of Bandera taxpayers' money," McGroarty said, adding, "Other than that, I have no comment on the case."
For the record, the litigation, which has been described as "an overreach of public officials" and the resultant discord was begun during the administration of Pallaske - rather than during the five months that Schumacher, as mayor pro tem, led the city after Pallaske's death.
Additionally, during the course of the protracted negotiations, both Cardenas and Schumacher had asked then-municipal attorney Monte Akers to settle the case and, at the request of McGroarty, to appoint a different attorney to work on the settlement.