Fort Worth Court of Appeals held plaintiffs’ pleadings defective in flood/drowning case but remanded to allow plaintiffs to replead

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City of Fort Worth v. Soledad Alvarez, et al. 02-20-00408-CV  (Tex. App. – Fort Worth, February 10, 2022)

This is a Texas Tort Claims Act (“TTCA”) vehicle accident case where the Fort Worth Court of Appeals agreed jurisdiction was not pled or presented but remanded for an opportunity to cure the pleading.

Romero was traveling in a vehicle with her daughter when floodwaters due to rain swept the vehicle into an alleged rain-filled excavation on property owned by Whiz-Q that was purported to have improper drainage due to a defective excavation. Both occupants drowned. The family sued Whiz-Q, the City and TxDOT. The City filed a plea to the jurisdiction claiming that its immunity was not waived because it did not own, occupy, or control “the property where this incident occurred” or the access road Romero was on. The plea was denied, and the City appealed.

Plaintiffs argued their pleadings incorporated by implication that the flood waters on the access road constituted a defective condition, but the City asserts the pleadings only mention defective excavation. The court held the pleadings must be read as written, which does not include the flood waters as a defective condition. The City next argued that it did not have a duty to make the premises safe because it did not create the dangerous condition or agree to make safe a known, dangerous condition.   However, a premises-liability defendant may be held liable for a dangerous condition on real property if it created the condition or it “assum[ed] control over and responsibility for the premises,” even if it did not own or physically occupy the property. “The relevant inquiry is whether the defendant assumed sufficient control over the part of the premises that presented the alleged danger so that the defendant had the responsibility to remedy it.”  While the City has exclusive control over its roadways, it entered into an agreement with TxDOT to maintain the access road. The City’s jurisdictional evidence shows that, at the time of the accident, the City did not possess—that is it did not own, occupy, or control—the property or the defective excavation on the property. Whiz-Q owns and operates its business on the property.  The court concluded that at the time of the accident, either Whiz-Q or TxDOT owned or maintained the property, not the City. The pleadings are therefore defective. However, the court noted a premise defect (as opposed to a special defect) could still be potentially raised in the pleadings under the agreement with TxDOT; at least the City failed to negate all conceivable avenues under the agreement.  As a result, the suit was remanded to allow the Plaintiffs to replead under a premise defect theory only.

If you would like to read this opinion click here. Panel consists of Chief Justice Sudderth, Justice Kerr,  and Justice Womack. Memorandum Opinion by Justice Kerr

Fort Worth Court of Appeals affirms trial court’s authority under Civil Service Act to vacate a hearing examiner award, remand for a rehearing, and require a separate hearing examiner

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Shea O’Neill v. City of Fort Worth, 02-21-00214-CV (Tex. App. – Fort Worth, Feb 3, 2022)

This is a civil service case (which has already gone up and down the appellate ladder) where the Fort Worth Court of Appeals affirmed the trial court’s ability to order a substituted hearing examiner in an appeal from an indefinite suspension. [Comment: Note, this is a 38-page opinion].

O’Neill was a firefighter for the City and was indefinitely suspended after being involved in a physical altercation with a citizen at a TCU football scrimmage.  He appealed to a hearing examiner who found for O’Neill. An appeal resulted to the Fort Worth Court of Appeals, which remanded the issue to decide if the hearing examiner improperly considered outside evidence. On remand, the court (specifically Judge Fitzpatrick) held the hearing examiner (Guttshall) violated the Civil Service Act (Tex. Loc. Gov’t Code §§143.010(g) and 143.053(d)) by considering evidence that was not presented in the final hearing.  The trial court vacated the examiner’s decision and ordered a rehearing. When the City recognized that the same hearing examiner (Guttshall) was set to preside over the rehearing, the City objected and filed a plea to the jurisdiction, which Guttshall denied. The City then filed suit (that resulted in the present appeal) under the Uniform Declaratory Judgments Act (UDJA) to hold Guttshall could not preside over the rehearing. The trial court held a trial on the merits under the UDJA claims and found Guttshall had exhibited bias, was no longer independent and ruled for the City. O’Neill appealed.

O’Neill argued the City’s declaratory-judgment lawsuit was barred by res judicata or collateral estoppel. The main issue presented to the trial court was whether Guttshall could preside over the rehearing regarding O’Neill’s appeal of his indefinite suspension. While O’Neill asserted the court failed to make the findings of fact on the issues he requested (so the findings entered could not be used in evaluating the appeal), the trial court, as the trier-of-fact has no duty to make additional or amended findings that are unnecessary or contrary to its judgment. O’Neill next asserted the City requested a rehearing when appealing Guttshall’s opinion to Judge Fitzpatrick so the issue of a hearing examiner was already addressed. Hence, his argument goes, since Judge Fitzpatrick did not expressly grant relief for a separate hearing examiner, only a rehearing, the issue was fully litigated. However, when an appellate court remands a case and limits a subsequent trial to a particular issue, the trial court may only determine that particular issue. Because of the remand, Judge Fitzpatrick was therefore constrained to decide only the City’s procured-by-unlawful-means claim and nothing provided for her to determine whether Guttshall had exhibited bias and was thus no longer an independent or impartial hearing examiner. As a result, res judicata and collateral estoppel are not triggered. Next, O’Neill asserted that since Guttshall denied the City’s plea, the issue was already addressed and the City cannot appeal. However, if the denial were considered the same as an arbitrator’s award (which O’Neill argued it was), such an award is appealable. But more importantly, the City’s plea to the jurisdiction and declaratory-judgment action accomplished separate purposes. The City’s plea was an objection to Guttshall presiding over the rehearing, which was a requirement to preserve the issue.  The UDJA claim went beyond mere preservation and sought express relief on the uncertainty of the issue under the wording of Chapter 143 (which does not expressly address this situation). Next, O’Neill argued the trial court erred by impliedly finding that subject-matter jurisdiction exists even though the City failed to exhaust its administrative remedies.  However, since the declarations sought are strictly limited to statutory interpretations, they are questions of law that do not require exhaustion. Next O’Neill argued that the trial court erred by fashioning a remedy not expressly authorized by the Civil Service Act, i.e., allowing a rehearing before a new hearing examiner. The trial court used guidance by referring to the Texas Arbitration Act (TAA) in interpreting/applying the Civil Service Act. The sections of the Civil Service Act make no provision for a scenario in which the district court vacates the hearing examiner’s award and remands the case for a rehearing. The court noted that the Texas Supreme Court has looked to the TAA in prior opinions to fill in the gaps when the Civil Service Act is silent.  Turning to the TAA concerning the issue here, it has a specific section dedicated to rehearings after an arbitration award is vacated. The Civil Service Act states in multiple locations that a hearing examiner must be independent and therefore neutral. When a hearing examiner is found to have developed bias against one party, they are not independent. To allow a biased hearing examiner to preside over the rehearing merely because the Civil Service Act is completely silent regarding rehearings is against the purpose of the Act. The trial court, following the Texas Supreme Court’s example for crafting remedies when the Civil Service Act provides none, is permitted to look to the TAA for guidance.  As a result, the trial court’s order is affirmed.

If you would like to read this opinion click here. Panel consists of Chief Justice Sudderth, Justice Bassel and Justice Walker. Memorandum Opinion by Justice Bassel.

Beaumont Court of Appeals reinstates arbitrator award for City in civil service termination.

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City of Beaumont, Texas v. James Mathews, 09-20-00053-CV (Tex. App. – Beaumont, Feb. 3, 2022)

This is a civil service/collective bargaining/arbitrator appeal (which has gone up and down the court of appeals route already) where the Beaumont Court of Appeals reversed the trial court’s order and reinstated the arbitrator’s award. [Comment: warning, this is a 38-page opinion].

Firefighter Mathews was discharged from the City of Beaumont Fire Department after a formal investigation into a rear-end collision involving Mathews occurred. Driver Freeman apparently rear-ended the vehicle driven by Mathews, causing Mathews to exit his vehicle and strike Freeman one or more times. The incident occurred while Mathews was off-duty, but the department’s rules and regulations apply certain standards of conduct regardless of duty status. The arbitrator admitted a statement from Freeman asserting such, which was corroborated by other evidence. Mathews appealed the termination to an arbitrator, who ultimately ruled in favor of the City, confirming Mathews’ termination. Mathews appealed to the district court, which reversed the arbitrator’s award, holding the arbitrator lacked jurisdiction and exceeded his jurisdiction. The City appealed.

The court found that Mathews timely filed an appeal of the termination, selected to proceed before an arbitrator and that Mathews signed the appeal letter.  By doing so, he triggered the arbitrator procedure. Mathews argued the notice of dismissal Chief Huff gave him failed to advise him he had the right under the Act to appeal before either the Commission or a neutral arbitrator. But the question is whether the lack of that information is jurisdictional when the record shows the firefighter was aware of the options that were available to him under the Act. Mathews never testified he was unaware he could select arbitration or civil service commission as an appeal forum. Likewise, Chief Huff never testified that she told Mathews he could appeal only to a neutral arbitrator. Mathews’ appeal letter cited the exact sections in the Act that provide firefighters with options in choosing the forum where they may appeal.  In fact, the evidence shows just the opposite, as the live pleadings indicate it was because of the Union’s distrust of the Beaumont civil service commission that Mathews selected the arbitrator. While Chief Huff’s notice does not contain clear and unambiguous language regarding the options it did notify Mathews that he should look to the Collective Bargaining Agreement to decide how to proceed.  Here, the record conclusively proves that Mathews decided after seeking advice from his union that it was in his best interest to demand his appeal be heard by a neutral arbitrator rather than going before a Commission. As a result, the arbitrator’s jurisdiction was properly triggered. Next, under the Act, neutral arbitrators exceed their jurisdiction when they conduct the proceedings in a manner “not authorized by the Act or [a manner that is] contrary to it, or when they invade the policy-setting realm protected by the nondelegation doctrine.” The City filed pretrial motions with attached evidence and the arbitrator denied the motions. During the evidentiary hearing, the City submitted some of the same evidence, which was admitted by the arbitrator. Mathews argued the arbitrator improperly considered evidence submitted through the pretrial motion procedure instead of exclusively at the evidentiary hearing. The district court held the arbitrator could not consider pretrial evidence or motions. However, the Act allows the parties to file pretrial motions and expressly states it is not a violation of the Act as long as copies of the filings are served on the opposing party. Thus, the City did nothing wrong by filing a pretrial motion since the certificate of service states the City served the motion on Mathews’ legal representative and Mathews never raised a lack of service. In turn, the arbitrator did not violate the Act by conducting a hearing on the City’s motion. Next, the court held that the record does not demonstrate the arbitrator considered evidence that was not admitted during the evidentiary hearing. As factfinders, neutral arbitrators are the sole judges of the admissibility of the evidence and the weight and credibility to be given the evidence admitted during a final hearing. Comparing the arbitrator’s findings of fact and conclusions with the evidence presented during the hearing, the court determined the arbitrator relied upon the evidence admitted at the final hearing. The district court conducted a factual and legal sufficiency review of the evidence, but that is not authorized by the Act. District court’s appellate review of arbitrator decisions are restricted to jurisdictional grounds and claims the award was procured by fraud, collusion, or through the use of other unlawful means. As a matter of law, the record present does not allow the district court to reverse the arbitrator’s decision. The district court’s order and final judgment have deprived the City of the statutory benefit of an efficient and speedy resolution through the Act. As a result, the district court’s order was reversed and the arbitrator’s decision was reinstated.

If you would like to read this opinion click here. Panel consists of Chief Justice Golemon, Justice Kreger and Justice Horton.  Memorandum Opinion by Justice Horton

 

14th Court of Appeals holds officer was not entitled to official immunity – proper focus is on the actions which caused the plaintiff’s injury, not on the overall investigation the officer was performing

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Nicholas Hulick v. City of Houston, 14-20-00424-CV  (Tex. App. Houston [14th Dist.], Feb. 1, 2022)

This is a Texas Tort Claims Act (“TTCA”)/ vehicle accident case where the Fourteenth District reversed the granting of the City’s plea to the jurisdiction based on the official immunity of its officer.

Officer Andrew De La Guardia responded to a service call involving a homeless suspect causing a disturbance on the street outside of a business. It was raining heavily while he was en route to the location. When he arrived, he drove around the area looking for the suspect, but was unable to find anyone matching the description.  When the rain became more severe he decided to turn around and head back to the station. Slowing to ten to fifteen miles per hour, he looked through the rain for oncoming traffic. Seeing none, the officer attempted to cross the westbound lanes of traffic but struck a motorcycle driven by Hulick.  Hulick sued.  The city filed a plea to the jurisdiction, arguing De La Guardia had official immunity at the time. Hulick appealed.

A governmental employee is entitled to official immunity: (1) for the performance of discretionary duties; (2) within the scope of the employee’s authority; (3) provided the employee acts in good faith.  If the employee is immune, the employee would not be liable under Texas law to the Plaintiff, therefore the City retains its immunity from suit.  The court analyzed whether the officer was performing a discretionary function at the time. An action is discretionary if it involves personal deliberation, decision, and judgment; on the other hand, an action that requires obedience to orders or the performance of a duty as to which the employee has no choice is ministerial. The court noted the City correctly observed that a law enforcement officer’s operation of a vehicle is a discretionary function in certain circumstances, including high-speed chase and responding to an emergency.  However, absent such special circumstances, an officer’s operation of a motor vehicle on official, non-emergency business is ministerial.  De La Guardia discontinued his search for the suspect at that time and was attempting to return to the station. While the City asserts he was performing an investigation (which is discretionary) the court held the focus should be on the actions which caused the injury (i.e. failing to yield the right-of-way to oncoming traffic).  The record did not support a finding of official immunity in this circumstance and the order granting the plea was reversed.

If you would like to read this opinion click here.  Panel consists of Justice Jewell, Justice Bourliot and Justice Poissant. Memorandum opinion by Justice Jewell.

Lubbock Court of Appeals affirmed board of adjustment condition to re-evaluate variance request after a set number of years

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MVP Raider Park Garage, LLC. V Zoning Board of Adjustment of City of Lubbock, et al, 07-20-00261-CV (Tex. App. – Lubbock, Jan. 12, 2022)

This is a board of adjustment case where the Lubbock Court of Appeals affirmed the BOA’s denial of a variance request.

Raider Park owns a parking garage that provides student parking for Texas Tech University. Under the City of Lubbock’s Code of Ordinances, not more than ten percent of any wall may be devoted to wall signs in the zoning district. Raider Park sought a variance to allow 35 percent of all walls to be used for signage. The BOA ultimately conditionally granted the variance but required stipulations, including a seven-year review and revision requirement of the variance. At the seven-year review, the BOA denied the request to continue the variance permit. Raider Park sued. Both parties filed opposing motions for summary judgment. The trial court ruled in favor of the BOA. Raider Park appealed.

The court first noted the BOA had the authority to require a review and to treat the request to reauthorize the variance as a new request. The City’s ordinances specifically authorize this type of condition. When the Board granted the requested variance in 2012, it did so “subject to” conditions that were expressly stated on the Board’s decision form. The Board referred to the condition as an “experiment” to see if this type of review process worked better and allowed actual data and public reaction to be evaluated. The Board created an opportunity to revisit whether 35 percent coverage was “too much” and if the increase was determined to be unworkable, then the Board could adjust it in the future. The original variance was specifically designed to allow the Board to revisit and revise. The court noted the Board had the discretion to treat the review as a new request and hold public hearings to gauge public reaction. Further, the review process was never challenged as invalid. The court next determined the original variance was not a temporary variance but a variance subject to conditions. If the owner had a problem with the condition, the owner could have appealed the decision. Further, Raider Park points to no authority prohibiting the imposition of such a condition.  As a result, the trial court order is affirmed.

If you would like to read this opinion click here. Panel consists of Justice Pirtle, Justice Parker and Justice Doss. Memorandum opinion by Justice Parker.

A defendant attempting to obtain dismissal for lack of evidence must use a no-evidence motion for summary judgment, not a no-evidence plea to the jurisdiction.

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A defendant attempting to obtain dismissal for lack of evidence must use a no-evidence motion for summary judgment, not a no-evidence plea to the jurisdiction.

Special contributing author Laura Mueller, City Attorney for Dripping Springs

Edinburg Consol. Ind. Sch. Dist. V. Ayala, No. 13-20-00590-CV (Tex. App.—Corpus Christi Dec. 9, 2021) (mem. op.).

In this appeal from a trial court’s denial of the district’s no evidence plea to the jurisdiction, the district argued that there was no evidence that the plaintiff applied for a new position at the district.  The Thirteenth Court of Appeals affirmed the trial court’s judgment on the no evidence plea to the jurisdiction holding that a no-evidence motion for summary judgment was the proper avenue after discovery for the district’s arguments.

The plaintiff worked for the district but was injured in 2013.  He returned to work, but was terminated in 2015.  He filed an employment law claim for his termination but did not follow up on the claim.  Then, the plaintiff alleges that he reapplied to work at the district in 2018 and was not hired.  He sued the district for employment discrimination based on his disability and national origin for not rehiring him.  The district argued that there is no evidence that the plaintiff reapplied.  The district filed a no-evidence plea to the jurisdiction and the trial court denied the plea.  The district appealed.

A plea to the jurisdiction is used to determine a court’s jurisdiction based on what is plead, a prima facie case, not to make a determination on fact issues.  To establish a prima facie case of discrimination, the employee must show: (1) he is in a protected class; (2) he was qualified for the position he applied for;  and (3) he was not hired.  Exxon Mobil Corp. v. Rincones, 520 S.W.3d 572, 583 (Tex. 2017); Donaldson v. Tex. Dep’t of Aging & Disability Servs., 495 S.W.3d 421, 433 (Tex. App.—Houston [1st Dist.] 2016, pet. denied).   For national origin discrimination, he also must plead that the district gave different treatment to a similarly situated applicant outside the protected class.  The plaintiff stated these elements in his pleading, but the district argued that he needed to do more than plead the elements and he had provided no proof that he had applied for the position.  As a “fair notice” state, the plaintiff does only need to plead facts or elements to show jurisdiction.  Horizon/CMS Healthcare Corp. v. Auld, 34 S.W.3d 887, 896 (Tex. 2000); see TEX. R. CIV. P. 45(b).  The Court of Appeals upheld the trial court’s denial of the plea to the jurisdiction because the plaintiff had plead sufficient facts to move forward with jurisdiction, although the district does have the ability to file a no-evidence motion for summary judgment.

The court of appeals affirmed the trial court’s judgment and the case was sent back to the trial court.

If you would like to read this opinion click here.   Panel consists of Chief Justice Contreras and  Justices Hinojosa and Silva.  Opinion by Chief Justice Dori Contreras.

13th Court of Appeals grants mandamus relief to TxDOT – allowed TxDOT to withhold from discovery skid mark and other highway safety statistics

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In re Texas Department of Transportation, 13-21-00214-CV  (Tex. App. – Corpus Christi, Dec. 9, 2021)

In this mandamus action, the 13th Court of Appeals conditionally granted the writ, noting federal law made certain information regarding highway safety data privileged and exempt from discovery.

The Simpson plaintiffs filed suit against TxDOT for survival and wrongful death damages arising from a motorcycle accident that occurred on State Highway 361 causing the death of one individual. The decedent was driving a motorcycle when a Ford F-150 truck veered into the decedent’s lane of travel. When the decedent attempted to avoid the collision and applied his brakes his back tire locked up and he was killed. The Simpson familied sued TxDOT (and others). The Simpsons alleged the roadway was dangerous and subject to “polishing” which a special roadway defect caused by years of travel and increased traffic that results in a decrease in the coefficient road friction.  The Simpsons alleged that TxDOT knew about the defect and was aware of multiple deaths on that stretch of the highway resulting from the defect. The Simpsons sought, through discovery, to compel TxDOT to produce Pavement Management Information System (PMIS) data, including skid testing data.  TxDOT sought a protective order and the Simpsons filed a motion to compel.  The trial court granted the Simpsons’ motion to compel and ordered TxDOT to produce the data. TxDOT initiated this original proceeding.

Since TxDOT is asserting the privilege, it had the burden to establish the privilege. TxDOT asserted 23 U.S.C. § 409 is a federal statute which protects traffic-hazard data that is compiled or collected by the state pursuant to federal highway safety programs from being the subject of discovery or being used as evidence in federal and state court proceedings. This includes the Highway Safety Improvement Program in § 148. See 23 U.S.C. §§ 130, 144, 148. Congress established several federal programs to assist the States in identifying and evaluating roads and highways in need of safety improvements and to provide funding for those projects. The United States Supreme Court concluded that this section “protects not just the information an agency generates” or compiles for the stated purposes, but “also any information that an agency collects from other sources” for those purposes. However, it does not apply to information collected for a different purpose. The Simpsons asserted the information that they requested was used as part of routine maintenance, and thus, the statutory privilege does not apply. However, TxDOT operates the PMIS program through its Maintenance Division, which keeps detailed statistics used for the program.  As a result, it was an abuse of discretion for the trial court to order the release of the information.

If you would like to read this opinion click here. Panel consists of Chief Justice Contreras and Justices Benavides and Tijerina. Opinion by Chief Justice Contreras

Fort Worth Court of Appeals holds Plaintiffs properly plead constitutional challenges to City’s short-term rental ordinance

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City of Grapevine v. Ludmilla B. Muns, et al, 02-19-00257-CV (Tex. App. – Fort Worth, Dec. 23, 2021)

This is an opinion on rehearing where the Fort Worth Court of Appeals reversed in part and affirmed in part the trial court’s order regarding the validity of the City’s short-term rental ordinance. [Comment: warning, this is a long opinion – 50 pages.]

The City asserted its zoning ordinance was written in a way that prevented short-term rentals (STRs), but some “bed and breakfasts” were allowed.  However, there was sporadic enforcement. After an increase in complaints about negative effects from STRs, the City conducted a study.  At the end of the study, the City passed an ordinance banning short-term rentals (STRs) in the entire city. The City provided a 45-day grace period before enforcement would begin. Several property owners and commercial real estate services sued to invalidate the ordinance. The City filed a plea to the jurisdiction and motion for summary judgment, which were denied. The City appealed.

The City first contended the Plaintiffs failed to appeal any decisions to the board of adjustment and therefore failed to exhaust their administrative remedies. Generally, a party must exhaust the administrative remedies available under Chapter 211 of the Local Government Code before seeking judicial review of an administrative official’s decision. However, the Plaintiffs did not apply for permits or otherwise receive any enforcement notification to which they must appeal. Statements made about the City’s intent to enforce an ordinance, without more, is not the type of administrative action over which an appeal is triggered. Appealable actions are those actual determinations made in the act or process of compelling a property owner’s compliance with a City ordinance. Information-only statements are not appealable administrative determinations.  Further, the Plaintiffs challenged the constitutionality of the ordinance, which does not always require exhaustion. Generally, administrative bodies do not have the authority to rule on the constitutionality of statutes and ordinances. And while constitutional challenges are not “globally exempted” from the exhaustion requirement, if the administrative body lacked the ability to “render a relief that would moot the claim” then no exhaustion is required.  The board of adjustment lacked the authority to grant the Plaintiffs’ the right to conduct an STR, so no exhaustion is required. Next, the City argued that STRs do not fit within the definition of a “single-family detached dwelling” under its zoning code because STRs are not occupied by a single-family but are occupied by groups of people. However, the City’s code defines the word “family” in such a way that it does not require that the people living as a “single housekeeping unit” be related by blood or marriage. It also has no duration of occupancy limit. As a result, by its own wording, the code does not prohibit STRs as long as the occupancy fall within the common and ordinary meaning of “family.”  The City next argued the Plaintiffs did not directly challenge the validity of the STR ordinance (only an interpretation of whether it applied to them) so no declaratory relief can be granted.  However, the court found their retroactivity, due-course-of-law, and takings claims turn on whether the existing code allowed STRs. To that extent, they have a valid justiciable controversy. Under the takings analysis, the court held that although a property owner generally has no vested right to use his property in a certain way without restriction, they have a vested right in the real property, which includes the ability to lease. From a constitutional standpoint, that is sufficient to trigger a protected property right interest for jurisdictional purposes. This, along with the fact the court found that STRs were not expressly prohibited by the wording of the ordinance,  creates a fact issue as to whether the Plaintiffs suffered a taking. The court also noted that, contrary to the City’s arguments, lost profits are a relevant factor to consider in assessing the property’s value and the severity of the economic impact on a property owner. The Plaintiffs pled and submitted evidence to support that STRs “generate higher average rent than long-term leases, even after expenses” and that the STR Ordinance prevents them from “participating in an active, lucrative market for [STRs].” Next, the court did agree with the City that the regulation of STRs is not preempted by the Tax Code, as alleged by the Plaintiffs. Plaintiffs did not point to any provision in either the Tax Code or the Property Code that implies that the legislature meant to limit or forbid local regulations banning STRs. The court then addressed the retroactive law arguments, holding that a “settled” right is different than a vested right and the Plaintiffs asserted the STR ordinance impaired their settled property rights under the common law and under the City’s code to lease their properties on a short-term basis. The issue is not about the “property owners’ right to use their property in a certain way,” but about the owners’ “retaining their well-settled right to lease their property.” Next, in the substantive-due-process context, a constitutionally protected right must be a vested right that has some definitive, rather than merely potential existence. Property owners do not acquire a constitutionally protected vested right in property uses once commenced or in zoning classifications once made. Thus, although the Homeowners have a vested right in their properties, they do not have a vested right under the Zoning Ordinance to use them as STRs.  However, the court found they do have a fundamental leasing right, which is sufficient to plead, jurisdictionally, a due-course-of-law claim. The court clarified in this rehearing opinion, that its holding on this point is limited to the fact a property owner has a fundamental right to lease, but the durational limits may be valid or may be invalid depending on the extent of the regulatory intrusion into that right. The intrusion goes to the merits of the case, which the court declined to address as part of the interlocutory appeal.  In short, the Plaintiffs properly plead all claims for jurisdictional purposes, except a claim under a preemption theory.

If you would like to read this opinion click here. Panel consisted of Chief Justice Sudderth and Justices Kerr and Gabriel.  Opinion on rehearing by Justice Kerr.

Fort Worth Court of Appeals holds one city was not entitled to a plea to the jurisdiction in condemnation suit brought by adjoining city

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Town of Westlake, Texas v. City of Southlake, 02-21-00241-CV  (Tex. App. – Fort Worth, Dec. 23, 2021)

This is an interlocutory appeal from the denial of the Town of Westlake’s plea to the jurisdiction in a case where the City of Southlake filed condemnation proceedings against the Town of Westlake.  The Fort Worth court of appeals affirmed the denial. [Comment: warning, this is a long opinion – 49 pages.]

The City of Southlake moved to condemn approximately 1400 feet of land owned by the Town of Westlake. In Southlake, a residential development was principally within Southlake, but abutted the boundary with Westlake. Immediately inside Westlake’s eastern town limit is a right of way owned and maintained by Westlake that abuts the lanes of Farm-to-Market Road 1938, but the actual road is owned by the State of Texas. The construction of the present configuration of FM 1938 was a cooperative effort of Southlake, Westlake, Keller, and Tarrant County.  Westlake opposed for years the developer’s requests for access across Westlake’s ROW as only one access to the development currently exists and the developer needed two. Westlake claims that the present condemnation action brought by Southlake is an attempt by Southlake to use its powers of condemnation to gain access to FM 1938 that the developer has not been able to negotiate. Southlake followed the condemnation procedures outlined in chapter 21 of the Texas Property Code and the commissioners awarded Westlake $22,000 for the condemnation. Westlake filed a motion to dismiss which was denied. Then, just before the award was filed with the district court, Westlake filed a plea to the jurisdiction in the district court. The court noted the plea was not a plea, but should have been a motion opposing the taking and denied the plea.  Westlake filed this interlocutory appeal in response. Southlake filed a motion to dismiss at the court of appeals level.

With regard to Southlake’s motion to dismiss, the trial court’s jurisdiction was triggered once the commissioners’ findings were filed, even if Westlake “jumped the gun” and filed the plea before the commissioners’ filing.  There is no consequence for filing early. As a result, the matter is properly before the appellate court. Next, regarding Westlake’s plea, Westlake first argues no waiver of immunity exists under §251.001 of the Local Government Code, however the court noted the language allows condemnation regardless of whether the property is already public or private, whether it is inside the city or outside, and possesses safeguards to prevent abuses. Because the statute allows condemnation of public property, it must, therefore include a waiver of immunity for the owning entity. Comparing the langue in §251.001 to similar provisions of the Utility Code (which the Texas Supreme Court previously ruled constitute a waiver of immunity), the court held immunity is waived for Westlake.  While case law states that when one governmental entity is condemning property owned by another governmental entity, the condemning entity must establish the “paramount importance” standards (i.e. it has a public need greater and will not destroy the public nature).  However, the paramount importance doctrine is not jurisdictional. With regards to Westlake’s argument that § 311.002 of the Transportation Code (giving cities exclusive control over streets and highways) the record has not been established enough to make the determination of whether the condemnation will interfere with such streets (since Westlake owns only the adjoining ROW). The record was also not sufficiently developed to establish whether Southlake could establish a valid public purpose.  As a result, the plea was within the trial court’s discretion to deny.

If you would like to read this opinion click here.  Panel consists of Justices Birdwell, Bassel, and Womack.  Memorandum opinion by Justice Bassel.

Texarkana holds city properly supported its summary judgment to permanently enjoin mobile home park

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Polecat Hill, LLC, et al. v. City of Longview, Texas, et al. 06-20-00062-CV (Tex. App. – Texarkana, December 2, 2021).

This is a nuisance/permit case brought under Chapter 54 of the Texas Local Government Code where the Texarkana Court of Appeals affirmed the judgment entered on behalf of the City.  [Comment: this is a long, 39-page opinion].

Polecat owned 5 acres of land within the City limits. Polecat received a notice of violation from the City asserting the property violated several health and safety ordinances and needed to be repaired. After receiving the notice, Polecat sued the City. The city counterclaimed against the corporate owners and sued the property in rem. Polecat asserted the property had operated as a location for manufactured dwellings to affix to real property and obtain connections since the 1960s. Polecat argued that the City refused to allow it to proceed with its plans to prepare the Property to be on public sewer service. Polecat argued that, instead, the City was requiring it to apply for a mobile home park license and comply with city ordinances by dedicating property to install fire hydrants, dedicating a turnaround space for fire trucks, and absorbing the cost of water flowing through the fire hydrants. The City asserted Polecat was illegally operating an unlicensed mobile home park and unlicensed travel trailer park in violation of the City’s code of ordinances.  The trial court granted the City’s traditional and no-evidence motions for summary judgment, resulting in a final judgment in favor of the City. The trial court’s order specifically found that the Polecat Defendants’ violations of city ordinances created a substantial danger of injury or adverse health impact and that a permanent injunction was necessary to prohibit the specific conduct that violated the ordinances and to require conduct necessary to comply with them. Polecat appealed.

The summary judgment evidence showed that the Property was continuously operated as a mobile home and travel trailer park. Polecat testified that the Property was a residential property that was eighty percent occupied, but admitted it housed rental mobile homes since the 1960s, as well as seven travel trailers.  The City’s appraisal district had labeled the Property as a mobile home park, and Polecat had never challenged that designation. Even the TNRCC sent notices of violations to Polecat related to improperly hooked up septic lines. The summary judgment evidence showed that the City was willing to work with the Polecat Defendants to obtain mobile home and travel trailer park licenses and would consider a site plan that complied with city ordinances, however, Polecat did not agree to comply with the ordinances.  During discovery, numerous other violations became apparent, including violations preventing fire trucks from being able to properly access or service the Property.  Polecat’s testimony established it never applied for a license to operate a mobile home park or travel trailer park.  The City’s traditional summary judgment motion established various violations of the City’s ordinances. The City also filed a no-evidence motion for summary judgment asserting that because the City was not requesting the dedication or transfer of any portion of the Property to the public for public use; the City had not deprived the Polecat Defendants of all viable use of the Property. Further, it was Polecat’s failure to apply for a site plan permit and a license that prevented the City from extending sewer services. Polecat also admitted it was not challenging the validity of any ordinances.

The court found Polecat failed to preserve its appellate points objecting to the City’s summary judgment evidence as they complained of only procedural defects and failed to obtain a ruling. Next, the court held the City was not required to prove continuing violations in order to be entitled to injunctive relief under Chapter 54. Polecat’s petition did not contain any challenge to the city ordinances themselves or allege that the ordinances did not apply to them and therefore was not entitled to any declaratory relief. The court also noted that there were multiple defendants, including the property in rem, but only Polecat responded to the summary judgment on behalf of itself alone. As a result, the other defendants could only attack the granting of the summary judgment by asserting the City failed to carry its burden of proof. The City met its burden to establish entitlement to summary judgment and permanent injunctive relief. Further, “[i]n a regulatory taking, it is the passage of the ordinance that injures a property’s value or usefulness.” Polecat does not challenge the passage of any ordinance. Instead, the petition focused on whether the City’s intentional actions resulted in inverse condemnation.  However, since the City did not destroy all economically viable use of the property, there can be no taking. Additionally, Polecat’s summary judgment evidence (which Polecat argued created a fact issue) contained mainly affidavits that were unsigned and unnotarized. As a result, Polecat failed to create a fact issue with proper summary judgment evidence. The trial court properly entered judgment for the City.

If you would like to read this opinion click here. Panel consists of Chief Justice Morris and Justices Burgess and Carter. Opinion by Justice Burgess.

Contract limiting remedies to replace or replacement by the vendor preclude damages for repair or replacement by a third party for failed product.   

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Special contributing author Laura Mueller, City Attorney for Dripping Springs

New Braunfels I.S.D. v. FieldTurf USA Inc., No. 07-20-00308-CV (Tex. App.—Amarillo Nov. 12, 2021) (mem. op.).

In this appeal from a trial court’s judgment in favor of the school district on its breach of contract claim but against the district on its fraud and attorney’s fees claims.   The defendant cross-appealed on the breach of contract damages award arguing that the contract did not allow for damages, but only for repair and replacement.  The Seventh Court of Appeals reversed the trial court’s judgment on the breach of contract claim and held in favor of the defendant based on the plain language of the contract.

The school district and the defendant entered into a contract for turf for its sports field.  The contract included a provision that the school district’s only remedy for the turf wearing out early is repair or replacement.  The turf did wear out early and the school district informed the vendor defendant. The vendor defendant inspected the field but did not repair or replace the field.  The school district paid a third party to replace the field and then sued the vendor defendant for the amount paid for the replacement based on breach of contract and fraud.  The jury held in favor of the school district for damages for breach of contract but not for the fraud claim.  The trial court entered judgment on the jury’s award but struck the prejudgment interest from the judgment.

Appellate review of a trial court’s entry of judgment on a jury verdict is a pure question of law. Arbor Windsor Court, Ltd. v. Weekley Homes, LP, 463 S.W.3d 131, 136 (Tex. App.—Houston [14th Dist.] 2015, pet. denied).  The issue of interpretation of a contractual provision that is unambiguous is a question of law and the court reads the plain langue of the contract.   URI, Inc. v. Kleberg Cty., 543 S.W.3d 755, 763-64 (Tex. 2018).  The Texas UCC Section 2.719 provides that a remedy may be substituted in the contract for those in the UCC, but if the remedy fails its essential purpose, a remedy in the UCC may be used.  The court of appeals held that the remedy did not fail its essential purpose and the language in this agreement adequately provided an exclusive remedy:

[t]his warranty is limited to the remedies of repair or replacement, which shall constitute the exclusive remedies available under this warranty, and all other remedies or recourses which might otherwise be available are hereby waived by the Buyer.

See Equistar Chems., L.P. v. ClydeUnion DB, Ltd., 579 S.W.3d 505, 522 (Tex. App.—Houston [14th Dist.] 2019, pet. denied) (citing PPG Indus., Inc. v. JMB/Houston Ctrs. Ltd. P’ship, 146 S.W.3d 79, 98, 101 (Tex. 2004).  Because the exclusive remedy was repair or replacement, the school district’s remedy was limited to repair or replacement and it could not be awarded damages. Without prevailing on its claim for damages, the school district was also not able to recover attorney’s fees.

The court of appeals reversed the trial court’s judgment and dismissed the claim for damages because the exclusive remedy was repair or replacement of the turf.

If you would like to read this opinion click here.   Panel consists of Chief Justice Quinn and  Justices Pirtle and Doss.  Opinion by Justice Pirtle.

 

Dallas Court of Appeals holds detour did not take excavation outside the normal use of the roadway, therefore plaintiff properly alleged a special defect

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City of Irving, Texas v. Edwin Muniz, 05-21-00099-CV, (Tex. App – Dallas, Nov. 19, 2021)

This is a premise defect/Texas Tort Claims Act (“TTCA”) case where the Dallas Court of Appeals affirmed the denial of the City’s plea to the jurisdiction.

During a rainstorm at night, Muniz entered an intersection undergoing construction for sewer pipe replacements. A detour sign directed him to merge slightly to the left, but he asserts he encountered a mesh fence with no time to brake. He traveled through the mesh fence into an excavation thirty-two feet deep. The court commented the evidence was confusing as to whether the signage indicated a lane shift or that traffic was to be closed heading westbound. Non-flashing barricades were present, but Muniz testified he did not see the barricades or cones depicted in the photographs on the night of his accident.  There was also a dispute as to Muniz’s speed.  Muniz sued asserting the excavation was a special defect, or at worse a premise defect. The City filed a plea to the jurisdiction, arguing, among other things, that the excavation was not on the roadway. The trial court denied the plea and the City appealed.

The City asserted because the detour directed traffic around the excavation, removing the  excavation from being a part of the regular roadway it could not be a special defect. The court noted the Texas supreme court “has never squarely confronted whether a hazard located off the road can (or can never) constitute a special defect,” but it has recognized that some intermediate courts of appeals have held that certain conditions located off the road were special defects. It is undisputed Muniz drove into a large hole in the normal roadway. The court noted the question, in this case, turns on whether such an excavation remains a special defect when the City attempts to warn of the excavation by erecting a detour but the warning failed. Here, the detour was not a separate roadway apart from the excavation but was on the same street as the excavation, only slightly shifted by lane redirects. An ordinary user of the roadway certainly could encounter the excavation. As a result, Muniz alleged sufficient facts to establish jurisdiction under a special defect theory.  The City also contended the detour design was a discretionary function. However, according to the court, the discretionary exclusion does not apply in the case of a special defect. The plea was properly denied.

The dissent noted the court was dealing with a portion of a road being taken out of commission for a construction project with the road actually moved to accommodate. He would have concluded the re-routing took the excavation out of the normal use of the roadway analysis.

Panel consists of Justices Schenck, Smith, and Garcia. Affirmed. Memorandum Opinion by Justice Smith can be read here.  Dissenting Opinion by Justice Schenck can be read here. Docket page with attorney information found here.

Dallas Court of Appeals holds commercial lease on property separated from airport was a proprietary function

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City of Dallas v. Oxley Leasing North Loop, LLC, 05-21-00241-CV, (Tex. App – Dallas, Nov. 12, 2021)

This is a breach of a lease agreement case where the Dallas Court of Appeals affirmed the denial of the City’s plea to the jurisdiction, holding the City was performing a proprietary function.

The City created a Land Use and Development Plan (“Development Plan”) for the airport. The Development Plan identified several portions of airport property for potential development, designating some as airfield operations, airfield-related development, non-aviation-related development, open space/recreational, and a commercial office park.  The City leased portions of the commercial office park (“the Property”) to First Continental Bank for an initial term of 40 years. The City agreed to construct a barrier and a road to physically separate the Property from the back of the airport. The lease was assigned several times, eventually being held by Oxley. The City and Oxley dispute whether Oxley property initiated an extension under the lease. The City, believing no renewal had occurred, moved to evict Oxley. Oxley filed suit for breach of the lease and the City filed a plea to the jurisdiction. The trial court denied the plea and the City appealed.

Leasing in a commercial park is not listed under the TTCA as a governmental function. As a result, the court must analyze the nature of the transaction under Wasson II standards. The mere fact that the City leased property located at the airport is not determinative of the nature of that activity.  Since the Property is identified by the City as nonaviation related, the court had little difficulty determining it was not related to the operation of the airport. Under Wasson II,  the City had no obligation to lease the Property to First Continental Bank, was discretionary, and the nature of the private lease necessarily excludes the general public from benefiting from the premises. The fact that a city’s proprietary action bears some metaphysical relation to a governmental function is insufficient to render the proprietary action governmental. As a result, the specific lease at issue is proprietary and the City is not entitled to immunity.

Panel consists of Justices Schenck, Smith, and Garcia. Affirmed. Memorandum Opinion by Justice Schenck can be read here. Docket page with attorney information found here.

U.S. 5th Circuit remands inmate’s sec. 1983 claims to evaluate whether prison disciplinary decision overlaps with excessive force claims

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Gray v. White, 20-30218, (US 5th Cir – Nov. 17, 2021)

This is a §1983/excessive force case where the U.S. Fifth Circuit Court of Appeals affirmed in part and reversed in part the trial court’s granting of the county’s summary judgment motion.

Timothy Gray is an inmate at the Elayn Hunt Correctional Center. Grey asserts Captain Wells and Major White attacked Gray in his cell without provocation, pulling him from his bunk and beating him. He was sprayed with a chemical agent and not allowed to wash it off. Grey asserts after he passed out he was put into a transport van, in restraints, and was beaten en route.  The County asserts Wells approached Grey for a targeted search. Grey was intoxicated and had vomited on himself. When Grey refused orders designed to move him to the showers to clean up he was grabbed and then became violent. The prison disciplinary board found Gray guilty of various violations. When Grey sued the individual officers who allegedly beat him, the officers moved for summary judgment based on Heck v Humphry (holding a conviction precludes relitigating aspects overlapping in a civil suit). Further, the officers asserted Grey failed to exhaust his remedies under the Prison Litigation Reform Act (“PLRA”) and is therefore precluded from suit. The trial court granted the officer’s motion and Grey appealed.

Heck holds  a prisoner may not “seek[] damages in a § 1983 suit” if “a judgment in favor of the plaintiff would necessarily imply the invalidity of his conviction or sentence.” Heck applies to both the validity and the duration of the confinement. A ruling by a prison disciplinary board also triggers the preclusive effects of Heck. However, Heck is not “implicated by a prisoner’s challenge that threatens no consequence for his conviction or the duration of his sentence.”  The court held the record was insufficient to determine whether, or which of, Gray’s claims are barred by Heck. The disciplinary reports list various factual findings but do not state which of these findings were necessary to his convictions.  As a result, the defendants failed to meet their summary judgment burden. Next, Under PLRA Grey was required to file a proper complaint about events after the shower before bringing suit. Gray failed to exhaust his administrative remedies for the claims of excessive force after he was taken from the shower area.

If you would like to read this opinion click here. Panel consists of Smith, Stewart, and Willett, Circuit Judges. Opinion by Judge Smith. Judge Willett concurred in judgement alone. Attorney for Appellee is Amber Mandina Babin, of New Orleans, Louisiana. Attorney for the Appellant is Donna Unkel Grodner, of Baton Rouge, Louisiana

Amarillo Court of Appeals holds fire marshal’s office employs firefighters who are entitled to civil service protection

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City of Amarillo, Texas, et al. v. Nathan Sloan Nurek and Michael Brandon Stennett, 07-20-00315-CV, (Tex. App – Amarillo, Nov. 18, 2021)

This is a civil service case where the Amarillo Court of Appeals affirmed in part and reversed in part a trial judgment holding the fire marshal’s office was entitled to civil service protection.

Plaintiffs sued the City and various officials trying to hold the Amarillo Fire Marshal’s Office (“FMO”) should be classified as a civil service position.  In the City, firefighters are classified positions, but the FMO is not classified.  As such, employees within the FMO are civilians who are not afforded civil service protections. The FMO performs fire prevention duties such as checking building plans, inspecting businesses, and investigating suspicious fires. FMO employees are certified by the Texas Commission on Fire Protection. Following a bench trial, the trial court entered a final order declaring that positions within the Amarillo FMO are civil service positions, but denied the promotional relief sought. The trial court ruled the firefighter’s association (“Association) was the necessary real party in interest, not the individual Plaintiffs and the claims were therefore precluded.

Both parties agree that the determination of whether a particular position is a “fire fighter” position depends on whether the position meets the definition identified in Texas Local Government Code section 143.003(4).  The City’s argument appeared to turn on whether the position was one of “fire suppression” and not other duties. The express language of section 419.032 distinguishes “fire protection personnel” from “fire suppression.”  The testimony established  FMO positions require substantial knowledge of firefighting. The trial court heard evidence that the FMO was moved within the Amarillo Fire Department in 1989, the FMO is part of the Fire Department for budgeting purposes, and the FMO is listed as part of the Fire Department within the City’s Organizational Structure. As a result, the trial court properly determined the position should be classified as a firefighter. Next, the City actively argued that the association lacked standing to participate in the case and Plaintiff’s agreed. The court did not see any basis for the trial court holding the association’s inaction established the defenses of laches, estoppel, or limitations. The trial court also made findings that the City proved that using non-classified employees in FMO positions was motivated by good faith, was more satisfactory to the public, and was based on more than monetary savings.  However, the standard requires that the City provide a good-faith reason to justify the use of non-classified personnel over civil servants, rather than assessing the qualifications of particular individuals to serve in those positions. Therefore, the City is not entitled to a good-faith defense for the use of non-classified personnel.   And while the court of appeals found the Plaintiff’s general relief was not precluded, the trial court did not consider the entitlement on the merits. As a result, certain relief matters were remanded.

Panel consists of Chief Justice Quinn, and Justices Parker and Doss. Affirmed, reversed, and remanded to trial court. Opinion by Justice Parker can be read here. Docket page with attorney information found here.