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Several homeowners alleged that noise and odor emanating from a gas company's compressor station caused a permanent nuisance. The company countered that because the homeowners' complaints predated their lawsuit by six years, limitations barred their action. A jury found that a permanent nuisance, which began just before the lawsuit was filed, diminished property values. The court of appeals affirmed the trial court's judgment for the homeowners. We agree with the court of appeals that some evidence supports the jury's finding on the accrual date.
In 1992, the Natural Gas Pipeline Company of America built a compressor station in Lamar County. Soon thereafter, area residents complained to the Company and to state regulators that the station's noise, odor, and lights interfered with the enjoyment of their homes. Between 1992 and 1998, William Justiss repeatedly called the Company and voiced his displeasure. In 1994, 1995, and 1996, he notified the Texas Natural Resources Conservation Commission (now known as the Texas Commission on Environmental Quality) about the noise and odor. Two years after the plant opened, Justiss's lawyer wrote to the Company, claiming that the station was causing the Justisses "total frustration and torment." The Company responded, through its lawyer, and stated that "the actual impact of the station on the Justiss' [sic] property [was] significantly less than described in [the] letter." A lawyer representing other residents also notified the Company that "the noise, vibration, lights, and related stimuli" were affecting the residents' "peaceful use of their homes and property."
A permanent nuisance claim accrues when the condition first "substantially interferes with the use and enjoyment of land by causing unreasonable discomfort or annoyance to persons of ordinary sensibilities." Schneider Nat'l Carriers, Inc. v. Bates, 147 S.W.3d 264, 269--70 (Tex. 2004). To establish a limitations defense, the defendant must prove that a permanent nuisance occurred, if at all, more than two years before the landowner's lawsuit. City of Abilene v. Downs, 367 S.W.2d 153, 159--60 (Tex. 1963).
On one end of the scale, a nuisance can be established by a physical fact that is beyond dispute. If the nuisance consists of hazardous chemicals in the ground, the nuisance begins when the landowner knows or should have known that the chemicals were there. See Tenn. Gas Transmission Co. v. Fromme, 269 S.W.2d 336, 338 (Tex. 1954) (holding that limitations began to run when the defendant began wrongfully discharging water containing harmful chemicals on the plaintiff's land, and "not on the date when the extent of the damages to the land were fully ascertainable"). The result does not necessarily vary with the amount of chemicals. If the nuisance involves largely subjective criteria like smell and sound, however, the analysis is necessarily more fact dependent. See City of Abilene, 367 S.W.2d at 160 (distinguishing a nuisance claim based on noxious fumes and odors from the water-based claim in Fromme and holding that the nuisance claim did not accrue when a sewage disposal system became operational but instead accrued when "operations of [the] sewage disposal system were such as to constitute a nuisance"). The point at which an odor moves from unpleasant to insufferable or when noise grows from annoying to intolerable "might be difficult to ascertain, but the practical judgment of an intelligent jury [is] equal to the task." Merrill v. Taylor, 10 S.W. 532, 534 (Tex. 1888).
A. The Property Owner Rule
If a nuisance is permanent, a landowner may recover the property's lost market value. See Schneider Nat'l Carriers, Inc., 147 S.W.3d at 276; Pickens v. Harrison, 252 S.W.2d 575, 582 (Tex. 1952) (holding that "[i]f respondents' suit is one for permanent damages to the land, the measure of damages is the decreased value of the land"). This normally requires a comparison of market value with and without the nuisance. Kraft v. Langford, 565 S.W.2d 223, 227 (Tex. 1978), disapproved on other grounds, Schneider Nat'l Carriers, Inc., 147 S.W.3d at 281; Sherman Gas & Elec. Co. v. Belden, 123 S.W. 119 (Tex. 1909).
A property owner may testify to the value of his property. We explained in Porras v. Craig, 675 S.W.2d 503, 504 (Tex. 1984), that "[o]pinion testimony concerning [damages to land] is subject to the same requirements as any other opinion evidence, with one exception: the owner of the property can testify to its market value, even if he could not qualify to testify about the value of like property belonging to someone else." We noted, however, that a property owner's testimony must be based on market, rather than intrinsic or some other speculative value of the property. Id. at 505. We stated that "[t]his requirement is usually met by asking the witness if he is familiar with the market value of his property." Id.
Because property owner testimony is the functional equivalent of expert testimony, it must be judged by the same standards. Thus, as with expert testimony, property valuations may not be based solely on a property owner's ipse dixit. An owner may not simply echo the phrase "market value" and state a number to substantiate his diminished value claim; he must provide the factual basis on which his opinion rests. This burden is not onerous, particularly in light of the resources available today. Evidence of price paid, nearby sales, tax valuations, appraisals, online resources, and any other relevant factors may be offered to support the claim. But the valuation must be substantiated; a naked assertion of "market value" is not enough. Of course, the owner's testimony may be challenged on cross-examination or refuted with independent evidence. But even if unchallenged, the testimony must support a verdict, and conclusory or speculative statements do not. See Kestenbaum, 514 F.2d at 699; Coastal, 136 S.W.3d at 233.
Natural Gas Pipeline Co. of America v. Justiss, 2012 WL 6214635 (Tex. 2012)