Recent Texas Cases of Interest to Cities

Note: Included cases are from November 11 through December 10, 2019.

Charter Amendments: Johnson v. Williams, No. 02-19-00089-CV, 2019 WL 6334689 (Tex. App.—Fort Worth Nov. 27, 2019) (mem. op.).  The Fort Worth Court of Appeals affirmed a plea to the jurisdiction in a case where a resident sued to invalidate a charter amendment.

Arlington residents initiated a petition drive for an amendment to the city charter that would impose term limits on the mayor and the city council (Proposition E), which the voters passed. Arlington resident Johnson asserted that because the petition summary misled petition signers, the petition’s circulators had committed fraud, and the resulting amendment should be struck down. He filed suit to invalidate the provision. The city defendants filed a plea to the jurisdiction and motion for summary judgment, which the trial court granted. Johnson appealed.

Elections are political matters, and the courts have jurisdiction of political matters only if the law has specifically granted such authority. The Texas Election Code allows an election contest for election fraud only if an election officer or other person officially involved in the administration of the election commits the alleged fraudulent act. The petition circulators do not formally qualify as election officers. After performing a statutory construction analysis, the court determined the circulators also do not qualify as a person “officially involved in the administration of the election.” As a result, the trial court properly granted the plea. The court declined to allow Johnson the ability to replead. However, the court noted that since the trial court lacked jurisdiction, it lacked the authority to enter an order on the summary judgment.*

Employment: Toldson v. Denton Indep. Sch. Dist., No. 02-18-00394-CV, 2019 WL 6205245 (Tex. App.—Fort Worth Nov. 21, 2019) (mem. op.).  This is a sexual harassment/retaliation claim where the Fort Worth Court of Appeals affirmed the employer’s motion for summary judgment.

Toldson worked for Denton Independent School District (DISD) as a paraprofessional teacher’s aide off and on from 2009 until he was terminated in February 2015. In 2014, Toldson served as an aide in the special education department at Ryan High School (RHS). Toldson complained to the assistant principal several times that the teacher (Ms. Winrow) was overly demanding and that Toldson did not know what was expected of him in the classroom. Toldson made no allegations during these meetings that Winrow had sexually harassed him. Toldson continued these complaints for several months until he eventually mentioned what he felt was inappropriate sexual comments. DISD offered to move Toldson to a different classroom while investigating his complaints. The principal interviewed five witnesses and did not find any who corroborated Toldson’s allegations of sexual harassment. The principal concluded the investigation and offered to move Toldson to another teacher, to which Toldson objected. Toldson complained to the DISD human relations department and asserted his immediate supervisors began retaliating against him by requiring him to be at department meetings where Winrow would be present. Toldson followed the grievance procedures, but with no resolution he would accept. During this entire time, Toldson’s job performance at RHS was an issue, including often arriving late for work, leaving early, and numerous absences, all without providing proper notification to his superiors. He also took longer breaks than allowed, as well as unauthorized breaks that left students unsupervised. Toldson was reassigned to a different campus. While there, the record reflects Toldson sexually harassed a female teacher. Upon learning of the incidents, DISD terminated Toldson. Toldson sued for sexual harassment and retaliation. The DISD filed a motion for summary judgment, which was granted. Toldson appealed.

Regarding his retaliation claim, the court noted Toldson identified no evidence establishing causation. While Toldson asserts an email present somewhere in the record constitutes direct evidence of causation, Toldson failed to identify, cite, or adequately brief the email for the court. Toldson bore the burden of supporting his contentions with appropriate citations to the record. Toldson failed to meet those burdens. Further, the court agreed DISD presented evidence of a legitimate, non-retaliatory reason for terminating Toldson’s employment. Toldson failed to demonstrate a fact issue exists regarding pretext. The court likewise had difficulty finding Toldson had properly briefed and identified arguments and issues regarding the sexual harassment claim. The court noted the summary judgment record in this case exceeds 2,000 pages. Of the nineteen sentences of alleged facts Toldson relies upon to show a fact issue the sexual harassment charge, eight contain no citation to the record whatsoever and the rest do not explain how they relate to any form of harassment. Toldson provided no reference to a specific place in the record where any exhibits exist, so he failed to brief his issues. The court affirmed summary judgment.*

Procedure: Wilson v. City of Austin, No. 03-18-00806-CV, 2019 WL 6336187 (Tex. App.—Austin Nov. 27, 2019) (mem. op). This appeal stems from the county court’s order granting the City of Austin’s motion to strike, special exception, and motion to dismiss in a case related to an automobile accident.

In July 2015, Wilson sued Phillips alleging that Phillip’s negligence caused an automobile collision in August 2013 that resulted in Wilson’s injuries. Phillips excepted to the petition and moved to dismiss the suit, arguing that Wilson should have sued the city because Phillips was driving within the scope of his employment with the city when the alleged accident occurred. The court granted the motion and dismissed the suit against Phillips with prejudice. In December 2015, Wilson filed a petition for bill of review claiming that her due process rights were violated because she was not served with Phillips answer or notice of hearing on his motion to dismiss, and never received notice of the order dismissing the suit. The county court reinstated the case, and Wilson filed her first amended original petition in June 2016, and listed the city as a defendant and alleged two counts of negligence, one against Phillips and the other against the city. A week later, Wilson filed a second amended petition and a notice of nonsuit with prejudice as to all her claims against Phillips. In October 2016, the court signed an order granting the notice of nonsuit and dismissing the claims against Phillips with prejudice. 

Two years later, Wilson filed her third amended petition (although titled a first amended petition) that named Phillips as the sole defendant and did not mention or discuss the city. Phillips excepted to the petition naming Phillips as the sole defendant as he had been nonsuited with prejudice. Phillips also moved to dismiss the cause because Wilson should not be given leave to amend the petition to name the city as the defendant given that the claims would now be time barred, and alternatively, for the cause to be dismissed for want of prosecution. A few days later, Wilson filed her fourth amended petition listing the city as the defendant and specifically stating the she did not intend at the time of filing the third amended petition to dismiss the city as a party, and that it was a clerical mistake. The city filed a motion to strike, a motion to dismiss, and a special exception, and noted that Wilson did not request leave to file her fourth amended petition against the city. Wilson responded, arguing that the relation back doctrine applies under the misnomer or misidentification theories to make her claims against the city timely. The court dismissed, with prejudice, Wilson’s claims against Phillips. The court also sustained the city’s exception, disallowing Wilson from repleading as the claims against the city were time barred, thereby dismissing Wilson’s claims against the city with prejudice. Wilson appealed the order related to the city arguing that the county court abused its discretion in granting the city’s special exception and dismissing her claims.

The court of appeals affirmed the county court’s decision. The court determined that by Wilson filing her third amended petition in which she omitted the city as a defendant, she effectively nonsuited or voluntarily dismissed her claims against the city. Additionally, the court found that Wilson’s claims against the city raised in her fourth amended petition that added the city as a defendant were untimely because the statute of limitations had run at the time of the third amended petition. The court also found that the misnomer and misidentification theories in the context of the relation back doctrine are inapplicable because Wilson did not misname the city as a defendant; rather she omitted the city as a defendant, and omitted all discussion and reference to the city. 

Short-term Rentals: Zaatari v. City of Austin, No. 03-17-00812-CV, 2019 WL 6336186 (Tex. App.—Austin Nov. 27, 2019). This is an appeal arising from a challenge to the City of Austin’s ordinance regulating short-term rental properties (STRs).

A number of property owners challenged certain provisions of the city’s ordinance as unconstitutional. Specifically, they challenged a provision that suspended the licensing of any new use of non-owner occupied single-family residences as short term rental properties (type-2 STRs) and terminated all type-2 STRs by 2022. They also challenged an ordinance provision that controls the conduct and types of assembly at short-term rental properties, including prohibiting any assemblies between the hours of 10:00 p.m. and 7:00 a.m., prohibiting outdoor assemblies of more than six adults between 7:00 a.m. and 10:00 p.m., and prohibiting more than six unrelated adults or ten related adults from being present on the property at any time. The State of Texas intervened in the property owners’ suit asserting that the ordinances’ ban on short-term rentals of non-homestead properties is unconstitutional as a retroactive law and as an uncompensated taking of private property. The trial court granted the city’s no-evidence motion for summary judgement, denied the property owners’ and the State’s traditional motions for summary judgement, excluded certain evidence from the summary-judgement record, and overruled the city’s plea to the jurisdiction. The property owners and the State appealed, and the city cross-appealed. 

In striking down the city’s ban of type-2 STRs, the court held that the provision is unconstitutionally retroactive because it would significantly impact property owners’ well-settled right to lease their property while serving minimal, if any, public interest. The court relied on a 2018 Texas Supreme Court opinion relating to homeowners associations’ limits on STRs to hold that short-term rentals are residential, rather than commercial, in nature. The court also concluded that the ordinance provision restricting assembly infringes on Texans’ fundamental right to assemble because it limits peaceable assembly on private property. The court determined that this provision is not narrowly tailored to serve a compelling state interest, thus, it violates the Texas Constitutions’ guarantee to due process.

TPDES Permit: Texas Comm’n on Envtl. Quality v. Maverick Cty., No. 03-17-00785-CV, 2019 WL 6042276 (Tex. App.—Austin Nov. 15, 2019) (mem. op.).  This appeal stems from a district court’s reversal of the Texas Commission on Environmental Quality’s (TCEQ) final order granting an industrial wastewater discharge permit application for the Eagle Pass Mine (Mine) that is owned by Dos Repúblicas Coal Partnership (DRCP).

DRCP’s predecessor in interest acquired a surface coal mining permit for the Mine in 2000, which was transferred to DRCP in 2009 when DRCP acquired the Mine. In 2009, DRCP entered into a contract mining agreement with Camino Real Fuels, LLC (CRF) to “develop, construct, operate and perform on-going reclamation at the Mine and to remove and deliver coal from the Mine” to DRCP.  In 2013, the Texas Railroad Commission renewed and issued to DRCP a surface coal mining permit and approved CRF as the operator of the Mine.  DRCP’s predecessor in interest had also acquired a wastewater discharge permit (a TPDES permit) for the Mine in 1994, which it renewed in subsequent years, with the most recent permit expiring in 2015.  After DCRF acquired the Mine, and prior to the expiration date of the most recent TPDES permit, DRCP applied to the TCEQ to amend and renew the permit.

The TCEQ executive director declared the application complete, and on DRCP’s request referred the application to the State Office of Administrative Hearings (SOAH) to be heard by two administrative law judges (ALJs).  The City of Eagle Pass, Maverick County, and other downstream landowners (Permit Contestants) were admitted as parties. Following a contested hearing, the ALJs issued a proposal for decision (PDF) recommending that the draft permit be granted with a few changes, including addition of a boron limit and a requirement that aluminum be monitored. After considering the PDF, TCEQ issued a final order granting DRCP’s application, but excluded the ALJ’s recommended findings relating to the boron limit and aluminum monitoring requirement, and instead imposed a sampling regime that would occur periodically over the life of the permit. The Permit Contestants appealed the decision to district court, alleging, among other things, that DRCP’s contractor, CRF, should have applied as the permit operator, and that TCEQ improperly modified the PDF by deleting the boron limit and aluminum monitoring requirement. 

The district court reversed TCEQ’s final order and remanded because the agency’s determination regarding the proper entity to be identified as the operator of the Mine was made in violation of statutory and regulatory provisions, but upheld the other issues on appeal.  DRCP and TCEQ appealed the district court’s order reversing and remanding the operator issue.  On cross appeal, the Permit Contestants challenge the district court’s judgement affirming TCEQ’s order as to the other issues raised. 

In affirming the district court’s order with respect to the operator issue, the court of appeals concluded that the TPDES permit application was incomplete because DCRP was not the operator of the Mine. The court looked to the plain language meaning of the regulatory definition for “operator,” and determined that although DCRP has overall financial responsibility over the operations of the Mine, overall financial responsibility alone is not sufficient to support a conclusion that DRCP is the operator of the Mine.  The court; however, vacated the portion of the district court’s final judgement affirming the other issues on appeal concerning the specific TPDES permit granted by TCEQ because issuing a judgement on those issues would be issuing an impermissible advisory opinion.

Immunity: Brown v. City of Ingram, No. 04-19-00508-CV, 2019 WL 6138231 (Tex. App.—San Antonio Nov. 20, 2019) (mem. op.).This is an accelerated appeal by Brown that stems from the trial court’s order granting the City of Ingram’s plea to the jurisdiction and the court’s judgment dismissing Brown’s counterclaim.

The City of Ingram sued Brown and eight other defendants seeking declaratory relief that its ordinance related to the city’s wastewater system was a valid and reasonable exercise of the city’s police powers. Brown asserted a counterclaim against the city arguing that the city had breached its contract for wastewater services by knowingly permitting an unqualified, unlicensed subcontractor to connect her property to the city’s sewer system and that the subcontractor’s alleged negligence resulted in a severed gas line causing damage to Brown and her property. In response to her counterclaim, the city filed a plea to the jurisdiction, which was later amended, asserting governmental immunity from suit. The trial court granted the city’s plea and dismissed Brown’s counterclaim. Brown appealed.

The court of appeals concluded that the city’s act of connecting residents to the city’s sewer system and its decisions regarding whether and how to do so are governmental functions. Because the conduct underlying Brown’s claim constitutes the city’s performance of a governmental function, the court held that the city is immune from suit. The court also determined that even assuming that the city and Brown entered into a contract for wastewater services, such contract did not involve the provision of goods or services to the city. Because the contract is not a contract subject to Chapter 271 of the Local Government Code, entering into such contract did not waive the city’s immunity from Brown’s suit for breach of contract. Accordingly, the court affirmed the trial court’s order.

Time Payment Fee: Simmons v. State, No. 10-18-00269-CR, 2019 WL 6464999 (Tex. App.—Waco Nov. 27, 2019).  This is an appeal challenging, among other things, the constitutionality of the time payment fee assessed against Simmons, who was convicted of assault family violence with a prior conviction for assault family violence.

Section 133.103 of the Local Government Code provides that a $25 fee be charged to a person convicted of a felony or misdemeanor if the person pays “any part of a fine, court costs, or restitution on or after the 31st day after the date on which the judgment is entered assessing the fine, court costs, or restitution.” The statute directs that the fee be allocated in the following manner: (1) fifty percent to the comptroller to the credit of the general revenue fund; (2) ten percent to the general fund of the city or county for the purpose of improving the efficiency of the administration of justice in the city or county; and (3) forty percent to the general revenue account of the county or city. Simmons contested the percentage of the $25 time payment fee directed to the comptroller and the general revenue account of the county or city, described in (1) and (3), above.

Like other Texas courts (including the First, Third, Eleventh, and Fourteenth Courts of Appeal), the Waco Court of Appeals concluded that, because these fees are general revenue not sufficiently related to a legitimate criminal justice purpose, Section 133.103(b) and (d) are facially unconstitutional. The trial court’s judgment was modified to change the time-payment fee from $25 to $2.50.

(Note: Senate Bill 346, effective January 1, 2020, amends the court cost structure, including the time payment fee. It remains to be seen whether the amendments cure the constitutional defects identified in this and previous cases.)

Charter Amendment: Nelson v. Head, No. 13-18-00484-CV, 2019 WL 6315425 (Tex. App.—Corpus Christi Nov. 26, 2019) (mem. op.). In 2013, the voters amended the city charter for Bay City to limit councilmembers and the mayor from serving more than three consecutive terms. In 2018, resident Robert Head filed suit against the city, the mayor, and two councilmembers alleging that non-voter approved language was erroneously added to the city charter that identified the mayor as a councilmember. Head claimed that the provision destroyed the separation of powers between the executive and legislative branches of government. Among other things, Head sought a declaration that the charter provision is invalid, argued that the mayor engaged in ultra vires conduct by voting in council meetings, argued that the mayor is subject to the term limits adopted in 2013, and that two councilmembers were reelected in violation of the term limit provision of the charter. The trial court denied the city’s plea to the jurisdiction and the city appealed.

During the pendency of the appeal, the city passed an ordinance striking the complained-of language from the charter and the voters elected to amend the charter by changing from a mayor-council form of government to a council/mayor-manager form of government, thus making the mayor a voting member of city council.

The appellate court reversed the trial court and rendered a dismissal for lack of jurisdiction after deciding virtually every issue in favor of the city and city officials. First, with regard to the claims against the mayor, the court held that Head failed to allege sufficient facts demonstrating how the mayor’s ultra vires votes caused him concrete, particularized injuries distinct from the effect on the general public. Further, the court held that Head’s ultra vires claims were barred by governmental immunity.

As for Head’s claims against the councilmembers, the court held the true nature of Head’s claims were the basis for a quo warranto proceeding, and Head did not have standing to bring them outside of the quo warranto procedure. In addition, Head failed to meet the narrow taxpayer exception to standing regarding his claims against the councilmembers. 

Texas Citizens Participation Act: City of Port Aransas v. Shodrok, No. 13-18-00011-CV, 2019 WL 6205466 (Tex. App.—Corpus Christi Nov. 21, 2019) (mem. op.). In July 2017, Julie Shodrok met with the mayor of Port Aransas in his office. Shodrok recorded their conversation using the recording device on her cell phone, with the mayor’s consent. When the meeting concluded, Shodrok left the mayor’s office but forgot her phone. The mayor and the city manager had a private conversation that was recorded on Shodrok’s phone, and Shodrok later expressed her frustration on social media about the details of the recorded private conversation between the mayor and the city manager.

The city filed suit against Shodrok for violating the Texas Interception of Communications Act (TICA). Shodrok moved to dismiss the suit based on the Texas Citizens Participation Act (TCPA) or anti-SLAPP statute. The trial court granted Shodrok’s motion to dismiss and awarded her attorney’s fees, costs, and sanctions against the city pursuant to the TCPA. The city appealed.

Pursuant to the TCPA, the appellate court first examined whether the city met its burden of establishing by clear and specific evidence a prima facie case for each essential element of the claim in question. The court held that it was undisputed that neither the mayor nor the city manager consented to Shodrok’s recording of their conversation in the mayor’s office. Therefore, the city established by clear and specific evidence a prima facie case that Shodrok intercepted a communication uttered by the city manager and mayor to which she was not a party by using a recording device. The burden then shifted to Shodrok to establish by preponderance of the evidence each essential element of a valid defense to the city’s claim. Because Shodrok could not do so, the court sustained the city’s first issue that it satisfied its burden to establish its TICA claim. Because the trial court erred in granting Shodrok’s motion to dismiss, she was not entitled to attorney’s fees and the sanctions award was not authorized.

The court reversed the trial court’s judgment and rendered judgment that Shodrok take nothing on her request for attorney’s fees and sanctions.

Inverse Condemnation: Starbright Car Wash LLC v. City of Belton, No. 14-18-00261-CV, 2019 WL 6711398 (Tex. App.—Houston [14th Dist.] Dec. 10, 2019) (mem. op.). In May 2005, the City of Belton adopted an ordinance approving a developer’s proposed change to a retail zoning district, which also indicated that the city would extend one particular road. Five years later, in November 2010, the city approved a revised plat that did not include the extension of the road. In December 2010, Starbright purchased the proposed car wash site. In May 2012, the plat was recorded without the extension of the road and the additional access point to the car wash site. Starbright sued the city, arguing that the city’s approval of the revised plat constituted a taking of its protected right in access to its property. The city filed a motion for summary judgment, which was granted by the trial court. Starbright appealed.

On appeal, Starbright argues that the city’s 2005 ordinance created a constitutionally-protected property interest in access from the extended road. The court held that property owners do not acquire a constitutionally-protected vested right in zoning classifications because the city retains its legislative authority to rezone at any time as public necessity demands. Further, Starbright didn’t purchase its property until after the city decided not to extend the road. Consequently, Starbright did not establish that it relied upon the city’s original plan to extend the road differently from any property owner’s reliance on more conventional zoning classifications. The filing for the revised plat did not constitute a taking; the court affirmed the trial court’s judgment.

Open Meetings Act: City of Austin v. Lake Austin Collective, Inc., No. 14-18-00068-CV, 2019 WL 6317337 (Tex. App.—Houston [14th Dist.] Nov. 26, 2019) (mem. op.). The City of Austin’s posted agenda for a November 10, 2016, meeting gave notice of the approval of an ordinance authorizing the execution of an amendment to a settlement agreement relating to the development of a specific property in the city. The ordinance was subsequently adopted, and included language in the ordinance and ordinance’s caption indicating that certain sections of city code and Lake Austin Watershed regulations were waived with regard to the property in question. Lake Austin Collective, Inc. filed suit alleging that the agenda item violated the Open Meetings Act (Act) by failing to provide proper notice of the subjects of the meeting since it did not make any mention of the waiver of city code or the watershed regulations. The trial court signed a final judgment in favor of Lake Austin Collective and the city appealed.

The issue on appeal was whether the city’s notice was sufficient. The court compared the content of the notice with the action taken at the meeting to determine if there was substantial compliance with the Act’s requirement to provide notice of the subject of a meeting. Finding that the city’s notice was fatally flawed, the court determined that the reader of the agenda would have lacked any notion that waiver of provisions of the city code or the watershed regulations were to be addressed by the council. Therefore, the agenda item fell short of the full disclosure required for substantial compliance with the Act. The court affirmed the judgment of the trial court.

Delinquent Property Taxes: Spring Branch Indep. Sch. Dist. v. Southwest Precision Printers, L.P, No. 14-18-00559-CV, 2019 WL 6000322 (Tex. App.—Houston [14th Dist.] Nov. 14, 2019) (mem. op.). In 2016, Page International Communications, L.L.C. (Page) filed for bankruptcy. Prior to doing so, Page entered into a royalty agreement with Southwest Precision Printers, L.P. (Southwest). Spring Branch ISD, along with other taxing units including the City of Houston, sued to collect delinquent property taxes on business personal property from Southwest under the theory of successor liability pursuant to Section 31.081 of the Tax Code. The taxing units argued that Southwest purchased Page’s name and goodwill through the royalty agreement, making Southwest liable for Page’s delinquent property taxes. The trial court issued a take-nothing judgment in favor of Southwest, and the taxing units appealed.

On appeal, the taxing units argued that the trial court’s judgment was against the great weight and preponderance of the evidence. More specifically, the taxing units contend that the agreement unambiguously establishes that Southwest purchased Page’s name and goodwill. The court goes on to examine the language in the agreement, ultimately reaching the conclusion that the agreement unambiguously shows that Southwest did not purchase Page’s name or goodwill. The court focused on one provision of the contract that listed the “purchased assets” and did not include Page’s name. Further, there was no language in the contract that indicated Southwest was purchasing Page’s goodwill. The court concluded that Southwest was not liable as a successor to Page pursuant to Section 31.081 of the Tax Code and affirmed the trial court’s judgment.

*Indicates case summaries taken largely from the work of the Law Offices of Ryan Henry, PLLC, and reprinted with permission from Ryan Henry.  To sign up for the firm’s blog, go to www.rshlawfirm.com.