Recent Texas Cases of Interest to Cities

Note:  Included cases are from May 5, 2013 through June 10, 2013.

Workers’ Compensation: City of Bellaire v. Johnson, No. 11-0933, 2013 WL 2450151 (Tex. June 7, 2013) (per curiam).  This workers’ compensation case began when an independent contractor, Johnson, working for the city lost an arm in a work-related accident.   Johnson came to the city through a staffing service which provided Johnson’s workers’ compensation coverage.  He was supervised by the city, but paid by the staffing service.  Johnson sued the city for damages outside the workers’ compensation framework arguing that he was a city employee, but not covered by the city’s workers’ compensation coverage.  The Texas Supreme Court held that there was no fact question that Johnson was: (1) a paid city employee; and (2) covered by the city’s workers’ compensation coverage.  The Court then held that Johnson’s claims were barred by the exclusive remedy provisions of the Workers’ Compensation Act, Texas Labor Code Section 408.001.

Retaliation:  Douglas v. Houston Housing Auth., No. 01-11-00508-CV, 2013 WL 2389893 (Tex. App.—Houston [1st Dist.] May 30, 2013) (mem. op.).  Douglas sued the housing authority after being terminated.  Douglas argued she was terminated because she alleged wrongdoing, harassment, and racial discrimination by her supervisor.  These claims were investigated and Douglas was terminated due to her inability to get along with her boss.  When Douglas asked the human relations (HR) director who fired her if she could appeal her termination, the HR director said that she could not.  Douglas’s attorney filed a letter with the housing authority stating that her termination violated the Texas Whistleblower Act.  Other than the letter and her conversation with the HR director, Douglas never tried to initiate the housing authority’s grievance process.    The court of appeals upheld the dismissal of Douglas’s whistleblower complaint because the housing authority’s grievance procedure applies to terminated employees, and she did not initiate the procedure before filing her claim.

Pensions: Klumb, v. Houston Municipal Employees Pension System, No. 01-12-00511-CV, 2013 WL 2285048 (Tex. App.—Houston [1st Dist.] May 23, 2013).  In this case, a group of employees and the City of Houston sued the Houston Municipal Employees Pension System (HMEPS) based on decisions made by HMEPS’s board of directors.  The city created a local government corporation to run its convention business and wanted to move some of its employees to the corporation so that the city could avoid its HMEPS pension liabilities for those employees.  In response, HMEPS’s board of directors expanded the definition of “employee” under Texas Revised Civil Statutes Article 6243h to include employees of local government corporations.  Some of the transferred employees and the city sued HMEPS to object to this decision.  The court of appeals held that the trial court did not have jurisdiction over the matter because HMEPS’s decision was an administrative interpretation of Article 6243h from which there is no judicial appeal.  See Houston Mun. Emps. Pension Sys. v. Ferrell, 248 S.W.3d 151 (Tex. 2007).  The city and employees argued that the acts of the directors were outside the scope of their authority (i.e., ultra vires acts), and that the decision violated the constitutional rights of the transferred employees.  The court disagreed, holding that HMEPS had authority to expand the definition of employee under its statutory authority to “supply any omission” to the statute under Article 6243h, Section 2(x)(2)-(3).  The court also held that HMEPS had a rational basis ─ the continuation of its funding ─ for choosing to continue to treat the corporation’s employees as city employees.

Associational Standing:  Spicewood Springs Road Tunnel Coalition, v. City of Austin, No. 03-11-00260-CV (Tex. App.—Austin June 6, 2013).  This case involves the issue of standing of several associations to challenge the City of Austin’s decision to tunnel under various parklands as part of a water treatment plant project.  The trial court granted the city’s plea to the jurisdiction holding the plaintiffs did not have standing to make such a challenge, and the plaintiffs appealed.  The Austin Court of Appeals reversed and remanded.

The appellate court refused to provide a background history, noting that the parties are well aware of the history and that memorandum opinions should not be any longer than necessary.  Essentially, the plaintiffs argued that the city failed to comply with Chapter 26 of the Texas Parks and Wildlife Code when it approved the project.  An analysis on those claims was not reached, though.  The city’s plea to the jurisdiction asserted the associations did not have standing since the associations do not own any property subject to the tunneling.  The associations countered that some of their members did own property directly across the street from the parklands, and these members are already experiencing noise and dust and would suffer further inconvenience and interference with the use and enjoyment of their property.  Additionally, one named Plaintiff, Joe Wheeler, owned land across the street and routinely used the trails and facilities, which would allegedly be damaged due to the tunneling.

The Third Court of Appeals held that the plaintiffs alleged particularized injuries separate from the general public and that associational standing need only have one member to have individual standing in order to grant such standing to the association. The court reversed and remanded to the trial court for further proceedings.*

Vested Rights:  City of San Antonio v. Greater San Antonio Builders Ass’n, No. 04–12–00745–CV, 2013 WL 2247468 (Tex. App.—San Antonio May 22, 2013) (mem. op.).  In this case, the City of San Antonio appealed the trial court’s decision in a suit seeking a declaratory judgment that the city’s Fair Notice Ordinance is void.  The City of San Antonio adopted a Fair Notice Ordinance requiring a property owner to submit an application providing information on an existing or proposed project before the city will recognize the owner’s vested rights.  The Builders Association (Association) filed a lawsuit seeking a declaration that the Fair Notice Ordinance was preempted by Chapter 245 of the Local Government Code.

The trial court granted summary judgment in favor of the Association declaring that the ordinance was void.  San Antonio contended that the Association lacked standing.  However, the court of appeals rejected the city’s position that only an applicant who has submitted an application under the Fair Notice Ordinance has standing.  The court concluded that the Association had standing because a real and substantial controversy existed as to whether the requirements of the Fair Notice Ordinance conflict with Chapter 245 and affirmed the trial court’s order. 

Redlight Cameras:  Skeen v. City of Richardson, No. 05-13-00064-CV, 2013 WL 2405501 (Tex. App.—Dallas May 31, 2013) (mem. op.).  Skeen was found guilty of an automated traffic signal violation in the Richardson Municipal Court and challenged the constitutionality of the ordinance under which she was convicted.  Skeen appealed her case directly to the Fifth Court of Appeals in Dallas, rather than appealing to the county courts.  Skeen argued that Texas Government Code Section 30.00027(a) grants the Texas courts of appeal jurisdiction to hear the constitutional challenge, and she need not first go through county court.

Section 30.00027(a) of the Government Code provides that an appellant has the right to appeal to the court of appeals if: (1) the fine assessed against the defendant exceeds $100 and the judgment is affirmed by the appellate court; or (2) the sole issue is the constitutionality of a statute or ordinance on which a conviction is based.  Notwithstanding this provision, the Dallas Court of Appeals held that appealing the constitutionality of an ordinance does not create an exception to the statutory mandate that a county court of criminal appeals has sole jurisdiction over appeals from municipal courts.  While the constitutionality may eventually be raised in the court of appeals, this section of the Government Code does not permit direct appeals.  The court of appeals concluded that the defendant’s proper course of action was to appeal her case to the county criminal court of appeals.

Contracts:  City of Canton v. Zanbaka, USA, LLC, No. 12-12-00006-CV, 2013 WL 2407223 (Tex. App.—Tyler May 31, 2013).  This is an interlocutory appeal from the denial of a plea to the jurisdiction based on sovereign immunity from a contract.  Zanbaka, USA, LLC d/b/a Duke’s Travel Plaza (“Duke’s”) entered into a contract with the City of Canton EDC to fund a sewer line and lift station install.  Duke’s agreed to allow annexation of its property, create sixty to seventy jobs, install fire hydrants and several other conditions tied to the sewer install.  After Duke’s performed its obligations, the city council delayed the sewer installation and Duke’s filed suit under the Uniform Declaratory Judgment Act to declare rights under Texas Local Government Code Section 271.152 (waiver of immunity for contracts for goods or services.)  The city filed a plea to the jurisdiction which was denied and the city appealed. The Tyler Court of Appeals reversed and rendered.

The key question was whether the benefits received by the city under this contract were “goods or services” under Chapter 271.  The court held the purpose of the agreement was to provide funding for a sewer line and lift station to Duke’s real property.  Any benefits that would flow from that primary purpose are indirect and attenuated benefits for which no waiver of immunity exists under Chapter 271.  There must be a direct and primary benefit to the city to qualify.  The court dismissed Duke’s claims.*

Billboards:  Lamar Advantage Outdoor Company, L.P. v. City of Tyler, No. 12-12-00257-CV, 2013 WL 2286075 (Tex. App.—Tyler, May 22, 2013).  This is a billboard case where Lamar sought compensation for the required removal of a billboard pursuant to Texas Local Government Code Chapter 216.  The trial court dismissed Lamar’s claims in an order on the city’s plea to the jurisdiction and summary judgment motion and Lamar appealed.

Lamar owned a billboard on private property within city limits under a ten year land lease.  The city purchased the property from the original land owner and when the lease ran out, the city, as the new owner, demanded the billboard’s removal.  Lamar removed the billboard but sought compensation for the sign’s value.  The city argued that Chapter 216 was designed for a situation where the city amends a regulation or ordinance requiring the removal of a lawfully placed billboard and must therefore compensate the billboard owner for its value.  Here, the city had no such regulation and was nothing more than a new property owner who desired the removal after the land lease had expired. The Twelfth Court of Appeals agreed.  Since no regulatory removal was present, no jurisdiction under Chapter 216 existed.*

Immunity:  Flowers v. City of Diboll, No. 12-12-00107-CV, 2013 WL 2286050 (Tex. App.—Tyler May 22, 2013).  This case involves governmental and qualified immunity of the city and a police officer arising out of an arrest of Flowers.  Flowers did not get along with the uncle (Cook) of a child over which he possessed primary custody.  After leaving a baseball game, Cook drove his truck alongside Flower’s and the vehicles collided.  After an investigation, Officer Baker arrested Flowers for deadly conduct for intentionally striking the other vehicle, but Flowers was never charged. He then sued the city, Baker, and the police chief for false arrest.  The trial court granted the defendants’ summary judgment motion and Flowers appealed.  The Twelfth Court of Appeals affirmed the dismissal.

Qualified immunity shields a police officer if a reasonable officer could have believed that the action taken was lawful in light of clearly established law and the information the officer possessed.  While the court chided Baker’s affidavit in support of an arrest warrant for being nothing more than a form affidavit, the court ultimately held that it is the facts, not the affidavit, which determine if probable cause existed to make an arrest.  Even though evidence conflicted in the investigation, a reasonable officer could have believed probable cause existed.  And since a warrant was not needed for a misdemeanor arrest, no constitutional or tort violations occurred. Flowers also failed to establish any inadequate policies existed which directly caused a constitutional violation.

An important point to take away from this case, other than the obvious ones, is the description of the flaws the court found in Baker’s affidavit.  The court explained that while a misdemeanor arrest does not require a warrant, any search warrant must be supported by a sufficient affidavit and Baker’s would have failed if that were the case. The court frowned on the use of form affidavits and held that a proper affidavit must explain the foundation of any beliefs formed by the officer.*

Trespass:  Redburn v. Garrett, No. 13-12-00215-CV, 2013 WL 2149699 (Tex. App.—Corpus Christi May 16, 2013) (mem. op. on rehearing).  In this case, the city filed a motion for rehearing.  In response, the court issued this opinion which withdrew its prior opinion and now properly holds that the city and its employees are immune from trespass claims.

Redburn owned property which contained a city culvert.  He brought, among other claims, a trespass claim asserting the culvert was never dedicated to the city and the city had no right to go onto his property to inspect or maintain it.  He then plugged the culvert with several tons of concrete and filed this suit against the city. The city also counter-claimed asserting an implied dedicated easement.  The trial court granted the city’s plea to the jurisdiction dismissing Redburn’s claims and he appealed.

After a detailed analysis, the court determined that the city’s counter-claim waived immunity from suit, but only as to the declaratory judgment claim to quiet title.  The court properly ruled that the individual employees retain immunity in their individual capacities pursuant to Texas Civil Practice and Remedies Code Section 101.106.  The court further held that since the trespass claim is an intentional tort, the city retains governmental immunity.  This is a much better and more reasoned holding than the court’s prior opinion.  It is interesting to note that it is a memorandum opinion, which is typically used for matters involving well settled law.*

Security Bond:  Ex Parte City of Corpus Christi, No. 13-11-00706-CV, 2013 WL 1932886 (Tex. App.—Corpus Christi May 9, 2013).  Michael Hummell and David Barabino filed suit for injunctive relief regarding the City of Corpus Christi’s expenditures of 2008 bond election revenue for a specific street project.  The city then filed suit seeking an expedited declaratory judgment under Government Code Section 1205.021 to validate the use of the bond funds for the street project at issue.  Pursuant to Section 1205.103 of the Government Code, the trial court set the security bond at $500 ($250 for Hummell and Barabino, respectively), and the city appealed the trial court’s denial of its motion to reconsider the bond amount on the grounds that the trial court abused its discretion by setting the bond in an amount that was insufficient and contrary to the evidence.  The court of appeals reviewed the testimony of city witnesses at the hearing, and found that cross-examination of those witnesses showed that costs to the city of a delayed bond project were uncertain.  As a result, the court concluded that the trial court did not abuse its discretion in setting the security bond.

Torts:  University of Texas Medical Branch at Galveston v Kai Hui Qi, No. 14-12-00581-CV, 2013 WL 2363140 (Tex. App.—Houston [14th Dist.] May 30, 2013).  This is a negligent use of tangible personal property case under the Texas Tort Claims Act (“TTCA”). Qi delivered a stillborn child at the University of Texas Medical Branch at Galveston (“UTMB”) hospital.  She sued UTMB alleging, among other things, that employees were negligent in the use of the blood pressure cuffs/testing equipment and urine test strips and by improperly reading and interpreting the results produced by the testing equipment which resulted in injury to Qi and the unborn child.  UTMB filed a plea to the jurisdiction which was denied.  It appealed and the court of appeals reversed and rendered.

The Fourteenth Court of Appeals first went through a type of historical analysis of the seminal cases dealing with negligent use of tangible personal property interpretations under the TTCA.  The culmination results in the principle that mere involvement of personal property is not sufficient to waive sovereign immunity.  The negligent use must be the cause of the injury.  Further, the negligent use of information, such as lab results or tests, is not the use of tangible personal property.  The substance of Qi’s claim is a failure to diagnose and treat for which no waiver of immunity exists.  The plea to the jurisdiction should have been granted so the court reversed and rendered, dismissing Qi’s claims for lack of jurisdiction.

This is a good case to examine if you are dealing with a distinction between use of information versus tangible personal property or the causation nexus between the use of tangible personal property and the injury.  The only area not really covered in this historic analysis which could have been is the “non-use” of property which does not waive immunity; however, the facts were not such that a detailed look was necessary for this particular case.*

Whistleblower:   Gray v. City of Galveston, No. 14-12-00183-CV, 2013 WL 2247386 (Tex. App.—Houston [14th Dist.] May 21, 2013).  This is a Texas Whistleblower Act (“Act”) case, where a police lieutenant in Galveston alleges he was retaliated against for reporting the chief of police to the local district attorney.  The city filed a plea to the jurisdiction which the trial court granted.  The Fourteenth Court of Appeals reversed and remanded holding that for pleading and jurisdictional purposes, Gray satisfied his allegation burdens.

Gray was the commander of the Office of Professional Standards.  When another officer filed a complaint with his office that the chief of police threatened him to prevent him from speaking at a city council meeting without running all matters by the chief first (violating his First Amendment rights), Gray sent the complaint to the district attorney, noting possible official oppression charges. Gray was subsequently transferred from his commander position to the detective division and no longer reported directly to the chief but to an officer of lesser rank.

The court noted that Gray’s pleadings were deficient in numerous respects, but it looked to the deposition testimony in the record to justify allowing the case to move forward.  This twenty-four page opinion went through an analysis of almost every level of the Act and ultimately determined: (1) a “good faith” report is one where a reasonable officer with the same training believed a violation of law occurred, even if mistaken (and First Amendment violations are tricky); (2) Gray’s transfer and subsequent reprimands were adverse personnel actions (but his ability to receive “on call” pay or outside jobs was not); and (3) Gray was not required to “exhaust” the administrative remedies under the collective bargaining agreement, but only to “initiate them” which Gray did.   The court noted several fact questions were present requiring them to take Gray’s version of the evidence as true.*

Telecom Relocation:  Southwestern Bell Telephone, L.P. v. Emmett, No. 14-11-01115-CV, 2013 WL 1909543 (Tex. App.—Houston [14th  Dist.] May 9, 2013).  This is a dispute about who must bear the cost of relocating AT&T’s telecommunication lines in the public right-of-way over bridges.  In this case, there was a project to demolish the existing city-owned bridges and replace them with longer, wider ones as part of a project.  The city told AT&T to relocate the lines on the bridge and AT&T responded it would comply only if compensated for the costs of relocation.  AT&T sued the city, county, flood control district and all agents and officials for declaratory and injunctive relief to force the city to pay the cost, citing to Section 49.223 of the Texas Water Code provision which attributes costs to the flood control district.

The legal arguments are extremely interesting given AT&T was asserting entitlement to prospective injunctive relief and not direct payment of costs (i.e., equitable relief and not money damages to circumvent sovereign immunity).  For those who follow the Heinrich line of cases (holding individuals can sue public officials, individually, to prevent ultra vires acts even if money payments result), the back and forth analysis can be useful in developing conditions which retain immunity.  An important moral to take away from this case is to pay close attention to interlocal agreements with other entities when dealing with joint projects, including the roles of individual officials.

The Fourteenth Court of Appeals rejected AT&T’s attempt to circumvent sovereign immunity defenses by characterizing matters as ultra vires acts of public officials.  AT&T’s “ultimate aim” was to establish “an entitlement to payment” for relocation, which therefore requires a strict construction standard of Section 49.223.  An over-simplified summary of the analysis is that since it was the city which ordered the relocation (due to an interlocal agreement as part of the project), and not the district, the Water Code does not apply.  The common law standard that a utility must bear the costs of relocation is therefore applicable. As a result, the trial court properly granted the individual officials’ plea to the jurisdiction and the city and county’s summary judgment motions.  In short, AT&T lost and must pay relocation costs.*

*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