Language matters, especially when it comes to settlement and waiver agreements. Take for instance Parkwood 121 Village, LP v. Collin Central Appraisal District, where a simple agreement on the date a property changed from qualified open-space agricultural land to commercial development turned into a protracted lawsuit.

Parkwood 121 Village, LP v. Collin Central Appraisal District, No. 05-23-00270-CV, 2024 WL 748397 (Tex. App.—Dallas Feb. 23, 2024, no pet.)
In Parkwood 121 Village, LP v. Collin Central Appraisal District, Parkwood executed with Collin CAD an “Agreement of Use Change” that noted the effective change of use date for its qualified open-space agricultural land along with an acknowledgement: “The parties acknowledge and agree that all complaints or formal protests with respect to the change of use determination herein above have been settled to their satisfaction, and hereby waive any further complaint and/or withdraw any protest, and waive any right to any further relief in this matter.”

Following this, Collin CAD caused the property to be valued at its market value for the change of use year, which resulted in additional taxes to be assessed (difference between taxes paid under qualified open-space agricultural land and market value). Parkwood argued that the Tax Code as understood from McKinney Millennium, LP v., Collin Central Appraisal District, prohibits additional taxes to be assessed in the change of use year; instead, the first year that additional taxes may be assessed is the year after the change in use occurs.  But Collin CAD argued that Parkwood’s prior execution of the “Agreement of Use Change,” which contained language that Parkwood waived any further complaint and right to any further relief, waived this complaint.

The Fifth Court rejected Collin CAD’s argument. It found that that the agreement’s language did not indicate Parkwood agreed to a specific valuation of the property or that it intended to waive its right to challenge Collin CAD’s valuation. Instead, it only reflected the parties’ agreement to the change of use and when that occurred. Because of this, the Fifth Court reversed the trial court’s judgment and held that Parkwood did not waive its right to protest the unlawful assessment of the additional tax by agreement.

The Fifth Court appeared to look to the intent of the contracting parties to render its opinion. This is an important takeaway. Property tax consultants and owners must carefully review the terms of any agreements with appraisal districts and ensure their intention is clear and the terms align with what exactly was agreed to.

Tex. Tax Code § 1.111(e):
(e) An agreement between a property owner or the owner’s agent and the chief appraiser is final if the agreement relates to a matter: (1) which may be protested to the appraisal review board or on which a protest has been filed but not determined by the board;  or (2) which may be corrected under Section 25.25 or on which a motion for correction under that section has been filed but not determined by the board.

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To review the Opinion from Parkwood 121 Village, LP v. Collin Central Appraisal District, click the following link (or copy and paste): https://search.txcourts.gov/SearchMedia.aspx?MediaVersionID=c7417508-31f6-4c97-bfe9-bd7bc5d37a7a&coa=coa05&DT=Opinion&MediaID=b7df0bf1-0527-45f4-ab0d-8c334676d6d6.

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Key Sections of Texas Property Tax Code: 
§ 1.111, Representation of Property Owner 

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