The San Antonio Court of Appeals has dealt the Bexar Central Appraisal District a legal defeat that cost local governments in the county millions of dollars in property tax revenue.
Bexar Appraisal District v. Abasto Properties, et al. (No. 04-22-00675-CV; December 10, 2025) arose from a dispute between Bexar Central Appraisal District and Abasto Properties, the developer of the San Antonio Whole Sale Produce Market (SAWPM), over the appraised value of certain property. The SAWPM is a “unified warehouse and distribution center for produce and other food products” made up of 60 individual and separately owned 4000-square-foot units where tenants can sell their products. Property owners of the these units joined Abasto as plaintiffs to assert unequal appraisal claims pursuant to § 42.26(a)(3), Tax Code. The plaintiffs argued the the District’s appraised value exceeded the median appraised value of comparable properties for tax years 2018, 2019 and 2020.
The SAWPM operates under a condominium regime, where each property owner shares a 1/60th undivided interest in commonly-owned areas. After the implementation of the condominium regime, the District created separate accounts for each individual unit, but still maintained an account for the entire 240,000-square-foot property. For tax year 2018, each of the properties was appraised at $250,000, including the 1/60th undivided interest in the SAWPM commonly owned property. Appraisals rose to $510,350 in 2019 and climbed to $531,170 in 2020.
At trial, two appraisal experts testified, one for the District and one for the plaintiffs. The only properties which the District’s expert used as comparables to find the median appraised values of individual units were the other units of the SAWPM. “In other words, Wood’s valuation for each of the Subject Properties in this litigation was based solely upon his valuation of the other fifty-nine Subject Properties in this litigation.” Wood came up with median appraised values for the individual units ranging between $250,000 and $263,607 for 2018; $510,350 to $538,065 for 2019, and $531,170 to $559,950 for 2020.
The plaintiffs’ expert used 11 cold-storage facilities, including facilities which directly compete with SAWPM, as comparables to find a median appraised value. His analysis found a per-square-foot median appraised value for the 11 facilities and multiplied by the 240,000 square feet which make up the SAWPM. After dividing by 60, Craig reached his median appraised value of the individual properties. His numbers came out to $179,560 for 2018, $200,080 for 2019, and $209,280 for 2020. The jury found the District had unequally appraised the properties of SAWPM in 2019 and 2020, and determined a valuation of $260,000 per unit for 2019 and $270,400 per condominium for 2020. The District appealed, challenging the jury’s determination, as well as evidentiary rulings and attorney’s fee awards.
In an opinion by McCray, court of appeals affirmed. The District argued that the trial court “erred in not excluding Owners’ expert as unreliable; there was no evidence or insufficient evidence to support the jury’s property valuations; the trial court erred by accepting the jury’s property valuations because the jury was not authorized to determine such, and was instead limited to the valuations presented by the two appraisal experts.”
First, the court rejected the District’s assertion that the trial court erred by allowing Plaintiffs’ expert’s testimony. The District contended that the expert’s methodology was unreliable because the expert chose to treat SAWPM as a single cold-storage facility to find comparable properties, and apportion valuation to the 60 individual units after determining the mean appraisal value from the comparable properties. The court found that the unique ownership structure of SAWPM justified the expert’s methods and noted that such structure exists nowhere else in Bexar County. Furthermore, the court noted that the District’s expert testified about his own methodology and that he had never before used subject properties to compare to other subject properties before this case. According to the record, the District’s expert excluded from his analysis seven potential comparables because of their age and size, but the court cited both § 42.26(a)(3) and SCOTX’s opinion Valero Ref.-Tex., L.P. v. Galveston Cent. Appraisal Dist., 519 S.W.3d 66 (Tex. 2017)to point out that the uniqueness of a property does not exclude it from comparison. The court stated that the Valerodecision supports the use of larger cold-storage facilities as comps “given the lack of similarly sized comparables in Bexar county.”
The District failed to present any authority supporting its position that Plaintiffs’ expert’s apportionment method was contrary to law. In fact, it “tacitly recognized” that its own accounts for the 60 individual units included 1/60th interest in commonly owned elements and apportioned taxes as such. The court noted that if the expert took the square foot appraised value, and multiplied by 4000 to reach the value of each unit, as the District’s expert did, he would have reached the same results. The court concluded that Plaintiffs’ method did not create an analytical gap. The trial court thus did not abuse its discretion by considering it reliable.
The court likewise rejected the District’s legal and factual insufficiency challenges to the jury’s verdict, as well as its argument that the jury did not have authority to calculate its own appraised value. While the District contended that its own expert’s testimony proved the unreliability of Plaintiffs’ method of appraisal, the court reiterated its previous holding that Plaintiffs’ methodology was reliable, and that while one expert’s testimony could prove an opposing expert’s testimony unreliable and therefore legally insufficient, the court found that the District’s expert’s testimony accomplished no such thing. Accordingly, Plaintiffs’ expert’s testimony was sufficient evidence to support the jury’s findings.
In cases in which a “battle of the experts” occurs, the Court emphasized that the jury is the sole judge of credibility, and the fact that the jury’s valuations fell within the range of the two expert’s valuations suggests findings of sufficiency. Even without Plaintiffs’ expert’s testimony, the court added, the jury still had sufficient evidence considering the District’s value and the province to determine the weight of its expert’s testimony. The court could not therefore substitute its judgement for the jury’s. Because the jury’s valuations fell within the range of trial evidence, the court concluded the the valuations could not be clearly wrong or unjust and were legally and factually sufficient to support the jury’s findings.
The District argued further that the jury improperly determined the appraised value and that the trial court erred by permitting jurors who were not qualified to establish appraised values to do so. While the court recognized the expertise of property tax appraisal, it maintained the jury’s province to “weigh the competing expert valuations and determine the median appraised value.” The court looked to other appraisal cases and found nothing supporting the District’s position that a jury should be more limited in an unequal appraisal case than otherwise. Furthermore, the court found this position to “take away the jury’s role as the factfinder under section 42.26(a)(3) of the Tax Code.” The trial court did not err in accepting the jury’s valuations, and the District’s first two issues were overruled.
The District’s challenges to the trial court’s evidentiary rulings were met with the same fate as its challenge to the sufficiency of the evidence The District argued that the trial court should have excluded the 2018-2020 certified appraisal roll values of the condominiums “because an appeal of an appraisal review board (“ARB”) decision is a de novo proceeding and, pursuant to § 42.26(b) no prior action by the ARB may be admitted as evidence. But the court found no support for this assertion. Instead, what may not be admitted “is the prior proceeding and final decision of the reviewing agency.” The court also cited §42.26(a)(3)’s mandate that the reviewing court “shall try all issues of fact and law raised by the pleadings.” In a de novo review where the central issue is whether the appraised value exceeded the properly adjusted median value of comparable properties, the court explained, it was “self-evident” that the certified appraised values of the properties in question are relevant evidence. Accordingly, the court concluded that it was not an error to admit such evidence. Even if the evidence had been improperly admitted, the court added, the error would be harmless due to its cumulative nature, as the District’s certified appraised values were introduced many times in properly admitted evidence and in both experts’ testimony.
The District’s next issue asserted an error by the trial court for allowing Plaintiffs to call on the District’s expert to authenticate an exhibit of the Plaintiffs’ evidence pursuant to Rule 193.6 because Plaintiffs did not disclose that they would do so. Citing Alvarado v. Farah Mfg. Co., 830 S.W.3d 911 (Tex. 1992), which held that “there may be circumstances in which good cause can be shown for admitting testimony of an undisclosed witness … as for example when the need for the testimony could noty reasonably have been anticipated,” the Court concluded that the District’s unexpected challenge to the authenticity of excerpts of its own ‘s testimony put Plaintiffs’ in a position to call him as an undisclosed witness. The District asserted further that the exclusion of recent sales prices of some of the condominiums was an error by the trial court because such evidence was necessary to rebut the rise in certified appraised values shown in the Plaintiffs’ exhibit. But because the record showed that the District never said anything about this specific evidence constituting rebuttal evidence, the court overruled this issue. But “[e]ven if [the court] were to assume that recent sales prices of certain Subject Properties would amount to relevant fair market value evidence, we find that the exclusion of this evidence was harmless. As explained in Texas Disposal, ‘to the exten that the fair market value of the subject property deviates from its equal and uniform appraised value, the [owner] is entitled to the lower of the two amounts for calculating the property taxes it owes.” Tex. Disposal Sys. Landfill, Inc. v. Travis Cent. Appraisal Dist by & through Crigler, 694 S.W.3d 752, 761 (Tex. 2024).
The court took some pains to explain in detail why Texas Disposal did not dictate the admission of the comparable sales data in this case. It acknowledged that in that case SCOTX disapproved of prior authority holding that market value evidence is not relevant in an equal and uniform challenge under §42.26(a)(3). It noted that the motion in limine to exclude sales price evidence in this case was based on that precedent, but since then SCOTX handed down Texas Disposal, which “stand[s] for the proposition that the recent sales price was automatically relevant, admissible evidence of fair market value.” But here SAWPM’s ownership structure had been clearly established as unique, leading the court to caution that any comps sales may not reflect the fair market value. Therefore, it was not unreasonable to think the trial court could have found the sales prices to be limited in value. Furthermore, the court of appeals read Texas Disposal to require market values of subject property and comparable properties to be properly adjusted, and the evidence in this case fell short of the analysis required. The court added that if an error did occur, it was harmless because the judgement on this case did not hinge on excluded evidence and result in improper judgement. The issue was overruled.
Turning to the attorney’s fees issue, the District argued that the court of appeals’ prior interpretation of § 42.29 in Zapata Cnty. Appraisal Dist. v. Coastal Oil & Gas Corp., 90 S.W.3d 847 (Tex. App.—San Antonio 2002, no pet.) was erroneous. That case held that an award of attorney’s fees is mandatory is the taxpayer prevails on an appeal of an excessive appraisal. The court politely explained stare decisis and overruled this issue.
Finally, the District argued that there was insufficient evidence to support the attorney’s fees award and a failure to segregate fees properly. It further asserted that the trial court abused its discretion by considering tax rates that Plaintiffs failed to present at trial. Regarding the District’s claim of insufficient evidence, the Court recounted the testimony of Plaintiffs’ attorney [the legendary property tax lawyer Lorri Michel], in which she proved up her considerable expertise, past experience, and hourly rates along with her preparation for this case and the billing activity which took place during this time. Though the District challenged the testimony as conclusory and stated the absence of actual invoices supporting the amount of the fees, the court, citing Rohrmoos Venture v. UTSW DVA Healthcare, LLP, 578 S.W.3d 469, 502 (Tex. 2019), affirmed that “contemporaneous billing records are not required to prove that the requested fees are reasonable.” Accordingly, the court concluded that sufficient evidence was provided to the jury to support the award of attorney’s fees.
The Court disagreed with the District’s challenge for no evidence for attorney’s fees due to a failure to segregate fees among individual condominiums over three separate years of valuation, because the legal services provided to the sixty separate accounts over three separate years became intertwined passed the point of needing to segregate according to Tony Gullo Motors I, L.P. v. Chapa. The Court stated even if the plaintiffs’ had to segregate fees, the testimony of their expert was “sufficient to satisfy the party’s burden to segregate its attorney’s fees,” (Abdo, 399 S.W.3d at 255).
In the District’s final issue, it contends the trial court abused its discretion when it considered tax rates (which the court emphasized were “necessary for calculating the cap on any attorney’s fees awards”) that the Plaintiffs failed to present at trial. The court found no authority for the District’s position that Plaintiffs had an obligation to produce this evidence, and overruled this issue as well.
This opinion serves a feast for property tax lawyers on the taxpayer side of the docket, as well as a heavy dose of humble pie for appraisal districts. Kudos to Counselor Michel for this signal victory, which appears to have saved her client about $30 million in taxes.
TCJL Legal Intern Haden Knobloch researched and prepared the first draft of this article.
