Texas Supreme Court declines to hear Canton case

By Donnita Fisher Managing Editor

What started out as a win-win for both Joe Zoubi and the city of Canton turned into a split decision. Now Zoubi is doing his best to make sure its not a loss for both sides.

Background Zoubi owns and operates Dukes Travel Plaza on Interstate 20. When he started building the facility, it wasnt in Canton. The property 9.25 acres was in Cantons extraterritorial jurisdiction. The Canton Economic Development Corp. approached Zoubi about the possibility of being annexed. Zoubi agreed and, in anticipation of a sewer line being extended to the property, put in a smaller septic tank than he would need to operate showers at the facility. The CEDC agreed to put the infrastructure in place to Dukes location at the northeast corner of I-20 and Highway 64. Cost of running the line to the property was less than $500,000, said Lynn Kitchens, CEDC assistant director, secretary and treasurer. Dukes agreed to be annexed, create 60 to 70 jobs with at least 50 being full time, confirm that the Myrtle Springs Water Association could supply enough water to the facility, install a fire hydrant as needed and directed by the city of Canton, and submit its monthly water bill to the city of Canton by the 15th of every month. CEDC officials said the sewer line would be finished in less than six months but a change in city leadership brought a delay and Zoubi eventually filed suit against the city. In the meantime, Dukes opened and the sewer line was completed. Judge Teresa Drum of the 294th District Court ruled in Zoubis favor. The city appealed. The case went to mediation. No settlement could be reached, so the case went to the 12th Court of Appeals where the court overturned the lower court ruling. Despite the general stated purpose that the agreement was intended to provide new economic opportunities for the Canton, Texas area, the tangible objective of the agreement between Dukes and the CEDC was to provide funding for a sewer line and lift station to Dukes real property. Any benefits that would flow from this tangible objective are indirect and attenuated benefits, and thus we conclude that Dukes did not contract to provide any service or good directly to the city Zoubi then asked the Texas Supreme Court to review the case. The suit was seeking adjudication of its claims for relief for declaratory judgment, specific performance, attorney fees and costs from defendant city of Canton. Plaintiff does not seek consequential, exemplary or monetary damages for breach of contract. The lawsuit was never about the money, Zoubi said. It was a matter of principle. Nov. 15 the court denied the review petition. I am 99.9 percent sure this should end the citys expenses in regards to this lawsuit, City Attorney Ron Stutes told councilmembers at their Nov. 19 meeting. He said he estimated the lawsuit cost the city between $30,000 and $40,000 in legal fees. The lawsuit should never have been filed, Councilman Cary Hilliard said. This case has gotten tremendous publicity the city had no recourse but to defend itself. Councilman Jerry Yarbrough said, Its not always the right thing to do, to settle. We stood our ground and won our case. Zoubi said while the city may have won the lawsuit, no one benefitted from the courts decision. We won the case at district level, they appealed. We went to mediation and I was ready to settle, Zoubi said. The request was reasonable and would have cost the city only 25 percent of what they spent on attorneys fees. And I was willing to invest back half of the 25 percent with the city of Canton in any project they wanted. But they didnt go for that and in the end, this benefitted no one.

Moving forward Zoubi said hes ready to put the case behind him and keep on doing what hes been doing since Dukes opened bringing in sales tax and supporting the city of Canton. We did what we said we would do, Zoubi said. We did the development, we have more employees and have generated more sales tax than we projected. We are still trying to do good for the community, for Canton. Dukes has about 70 employees and everything is operating smoothly right now, Zoubi said. We are moving on the right track. According to Van Zandt County Appraisal District records, Dukes is appraised at $2.266 million and pays $45,913.42 in property tax yearly $11,009.34 to Van Zandt County; $9,524.77 to Canton; and $25,379.31 to the Wills Point school district. In addition to the convenience store/gas station, Dukes two restaurants: Dukes BBQ Smokehouse and Taco Casa and a knife shop. They all pay sales tax. When the deal was brokered, CEDC officials estimated the cost of installing the sewer line would be recuperated in five years. Based on property and sales tax figures, it now looks like it will be less than that. Dukes is doing everything they promised and more, Kitchens said. Even while the lawsuit was working its way through the court system, Zoubi and Dukes were supporting community organizations and events. Weve never turned away churches, schools or kids, Zoubi said. Weve always supported them with donations of funds and goods. And we continue to sponsor events, and we are very involved with the Canton Education Foundation and we do a lot of other things with churches. Life Fellowship Church of Myrtle Springs often meets at Dukes and recently hosted their Thanksgiving meal there. We try hard to be involved in the community, Zoubi said. Our lawsuit was not against the people of Canton. It just seems some officials had a double standard on projects. We tried so many times to solve it, end it and have a new start. We will continue to work with community all the way and continue to sponsor events. Zoubi plans to expand the offerings on his corner of I-20. Hes bringing in a Sweet Frog premium frozen yogurt and building Dukes Sports Caf a destination for sports watching with burgers, wings and games. The new businesses will be free standing next to Dukes and employee at least 25 more people, Zoubi said. Although he would have liked to have had a different outcome to the court proceedings, Zoubi said he will still do his best to promote Canton and local businesses and he hopes the city will do the same. Businesses in Canton need all the help from the city they can get because Terrell is taking away I-20 business, he said. I-20 travelers will go to Terrell because Terrell is aggressively seeking businesses coming in Canton isnt. Terrell announced last month that Buc-ees is building there. Zoubi said he is grateful to Canton Mayor Rick Lawrence for extending the hand of friendship. That move of inclusion makes Dukes want to do more for the city, for Canton and for Van Zandt County, Zoubi said. For the holiday season, Dukes Manager Brandy Kuhel made a list of many of the churches in the area. Dukes will be adopting a family from each of 26 churches. We are part of the community, Zoubi said.

Visit link:
Texas Supreme Court declines to hear Canton case