City officials not entitled to automatic stay or supersedes on appeal says 4th Court of Appeals

City of Rio Grande City, et al v. BFI Waste Services of Texas, LP d/b/a Allied Waste Services of Rio Grande Valley 04-15-00729-CV (Tex. App. – San Antonio, April 4, 2016)

This is an interlocutory appeal case where the central issues are procedural supersedes of an injunction order and an automatic stay of proceedings. This is not the final opinion, but a ruling on a motion. The Fourth Court of Appeals held neither applied and the City officials must abide by the temporary injunction order even though the case is on appeal.

While the order does not go into facts, the underlying case is essentially a contract dispute for garbage collection services. In September 2015 the City voted to terminate the contract with BFI/Allied Waste. BFI/Allied asserted the termination was not authorized under the terms of the contract. The City began negotiating a new contract with Grande Garbage. BFI/Allied Waste received a TRO then a temporary injunction prohibiting the City from cancelling the contract or awarding a contract to Grande. The TRO was obtained in federal court but the case was remanded to state court afterwards.  The City and its officials filed an interlocutory appeal of the injunction order. The Injunction applied to the City as well as to City officials individually and in their official capacities. While the appeal was pending a question arose as to whether the City and its officials were still under the injunction due to an automatic supersedes without security which applies to a City, whether an automatic stay applies to the underlying proceedings during the appeal, and whether the injunction was a defacto denial of the City’s plea.

The court first noted BFI/Allied did not get properly served with the plea to the jurisdiction at the time of the injunction hearing. The City argued that by proceeding with the injunction hearing the trial court denied the plea. The 4th Court held the injunction was not a determination implicating the merits so it was not a denial of the plea. The plea could therefore not be addressed on appeal.  And since the automatic stay of trial court proceedings under §51.014 (interlocutory appeals) does not apply for injunction appeals, no automatic stay is in place. Next, Tex. Civ. Prac. & Rem. Code §6.002 states security for costs to obtain a supersedes of a trial court order is not necessary for a city or town. However, that applies only to the City and its officials in their official capacity. The individuals cannot utilize that section to avoid paying the security for the supersedes and it is not automatic. Further, the supersedes is not absolute. Neither the applicable statute, §6.002, Tex. Civ. Prac. & Rem. Code § 6.002, nor TEX. R. APP. P. 29, removes the trial court’s historical “discretion to prevent the State’s automatic suspension of an adverse non-money judgment.”  As a result, the injunction stands and must be obeyed. No stay exists in the trial court.

If you would like to read this opinion click here. Panel: Justice Alvarez, Justice Chapa and Justice Pulliam. Opinion by Justice Alvarez.  The attorneys listed for BFI are Gilberto Hinojosa and John David Franz.  The attorneys listed for the City are Jacqueline LeFevre Salinas and Antonio Martinez.  The attorney listed for Grande Garbage is Brandy Wingate Voss