J. Patrick Sutton Cases & Issues Blog

The Onslaught Against Historically-Vital Leasing and Short-Term Rental Rights Continues

My caseload is now overwhelmingly property-rights oriented, particularly as regards leasing and short-term leasing. Property owners' right to lease out their properties, including short-term renting, are under determined assault all over Texas, in cities and subdivisions. I have represented hundreds of property owners defending time-honored leasing rights. I currently represent property owners in constitutional challenges in state and federal courts to municipal bans on short-term rentals, as well as all kinds of challenges to subdivision and HOA bans on STR's. Read on for more info.

My clients who sued the City of Grapevine won a significant victory in the Fort Worth Court of Appeals on August 5, 2021, turning back a challenge by the City of Grapevine which would have undone a temporary injunction granted to my clients by the Tarrant County District Court and caused the lawsuit to be dismissed. The decision in
Muns et al. v. City of Grapevine is HERE. The Fort Worth Court of Appeals, in a strongly-worded opinion, upheld every constitutional theory asserted by the homeowners who rent for short terms. The only claim dismissed was one in which the homeowners asserted that the Texas Legislature intended to prevent cities from banning short-term rentals (because the Legislature amended the Texas Hotel Tax in 2015 to include homes rented for short terms, meaning it wants tax revenue).

The Fort Worth Court of Appeals strongly approved of the analysis of the Austin Court of Appeals in the
Zaatari v. City of Austin case, which put a stake in the heart of Austin's ban on non-owner-occupied short-term home rentals. In July, the Texas Supreme Court refused to even hear the Zaatari case, and at that point, the Fort Worth Court of Appeals evidently felt it was a good time to reaffirm and extend Zaatari.

Note, the temporary injunction that allows my clients to continue renting in Grapevine does not, by its terms, extend to other homeowners in Grapevine. If you are one of those homeowners who wishes to rent out your house for short terms, you will need to seek legal advice.


I have some 20 pending cases where a majority of homeowners in a subdivision voted suddenly to amend the deed restrictions to ban STR's, leaving my clients, who had already been renting, in the lurch. My clients are 2-2 in these cases so far, and those cases are now in the courts of appeal in Austin, Houston, and Beaumont. My clients argue that new and unexpected amendments to deed restrictions cannot be applied retroactively to people who bought homes with wide-open leasing rights. The basic arguments are all laid out

still have cases pending where deed restrictions afford homeowners wide-open leasing rights, but opponents of short-term rentals sue (or threaten to sue), trotting out a tired argument repeatedly rejected by the courts: that a home rented to people who stay there for short terms is a "business." The argument, in a nutshell, is usually that when a tenant causes a nuisance or does not make the home a permanent residence, the home is a prohibited business. It makes no sense, but, alas, there are judges in Texas and around the country who accept it. See, for example, the dissent in a recent case in the Supreme Court of South Dakota (Wilson v. Maynard, 961 N.W.2d 596 (S.D. 2021) bought into it too, never squarely addressing what I think is the devastating comeback: that if the ordinary incidents of residential leasing (earning rental income, advertising, tenant comings-and-goings, tenants parking their cars, etc.) turn a home into a "business," then all leasing is prohibited. Every argument advanced as to why a short-term lease is a "business" applies equally to long-term rentals.

What's really going on is that, after Ken Tarr won in the Texas Supreme Court in 2018 in protecting his right to rent for short terms where his deed restrictions said nothing at all about short-term renting, angry, defiant HOA's and homeowners with financial means sue (or threaten to sue) anyway, presumably hoping to bully short-term-renting homeowners into submission. So far, the people I represent have not capitulated, but the fights go on in county trial courts and courts of appeals around the state. A similar such case,
JBrice v. Wilcrest Walk, where the deed restrictions have an express right to lease without restrictions, is currently being briefed in the Texas Supreme Court. Fingers crossed it gets taken up.
J. Patrick Sutton Cases & Issues Blog