Background Image
Previous Page  16 / 41 Next Page
Information
Show Menu
Previous Page 16 / 41 Next Page
Page Background

16

The Texas Property Owner Rule

By Hon. Craig Estlinbaum

*

T

exas judges and jurors are often called upon to resolve disputes regarding property value.

These disputes may arise in many case types, including divorce, probate, property tax

and some civil cases. Generally, when property value becomes issue in a case, parties

are required to present valuation testimony through an expert witness. An exception to

this requirement is known as the Property Owner Rule.

1

The Property Owner Rule provides that a property owner

2

is qualified to testify about his property’s

value even though he would not be qualified to testify about the value of similar property owned

by someone else.

3

Property Owner Rule testimony falls under Rule 701.

4

This evidentiary rule

allows lay witnesses to provide opinion testimony when that testimony is “rationally based on the

perceptions of the witnesses,” and is “helpful to a clear understanding of the witnesses’ testimony

or the determination of a fact in issue.”

5

The Property Owner Rule rests upon the assumption that

a property owner is familiar with his property and its value even though he may not be familiar with

property values generally.

6

The owner’s valuation testimony serves the same function at trial as

Rule 702 expert testimony.

7

The Property Owner Rule provides a cost advantage for the landowner litigant when value is an

issue. Utilizing the rule, a property owner can testify to market value while a non-owner in the same

litigation usually must hire or otherwise secure valuation testimony from a qualified Rule 702 expert.

The rule, therefore, offers parties an opportunity to save litigation costs even though some expertise

and objectivity may be lost.

A recent Supreme Court of Texas case,

Natural Gas Pipeline Co. of America v. Justiss

,

8

addressed

the relationship between the Property Owner Rule and the requirements for Rule 702 opinion

testimony by experts generally. This case reveals that presenting valuation testimony through the

property owner may not be as simple a proposition as it may first appear. The case holds that a

property owner’s valuation testimony must meet the same reliability requirements that apply to

expert witnesses generally.

9

Porras

and the Market

Value Standard

To understand how

Justiss

affects the Property Owner

Rule, it is necessary to first

understand the rule as it

existed prior to that decision.

The first Supreme Court of

Texas case to examine the

Property Owner Rule in the

post-war era was

Porras v.

Craig

,

0

a suit for trespass

damages to land. The

property owner plaintiff, Craig,

testified about the affected

property’s value. Craig limited

his testimony to the property’s

intrinsic value

1

to him and his

The Property

Owner Rule

rests upon the

assumption that

a property owner

is familiar with

his property and

its value...