City of Leon Valley Economic Development Corporation v. Larry Little
422 S.W.3d 37
Tex. App.2013Background
- LVEDC is a Type B economic development corporation created under the Development Corporation Act of 1979; LVEDC sought immunity from Little’s breach of contract suit via a plea to the jurisdiction; trial court denied the plea; LVEDC appealed interlocutorily under Tex. Civ. Prac. & Rem. Code § 51.014(a)(8); LVEDC argued it is a governmental unit entitled to immunity; court previously withdrew a June 2013 opinion and issued this substituted opinion affirming the denial.
- The dispute arises from negotiations and two sales contracts for unimproved land tied to the Leon Valley Town Center Project; LVEDC claimed third-party financing at a specified rate was required and not obtained, while Little alleged breach of contract for failing to obtain financing.
- Statutory framework: LVEDC is not inherently a governmental unit but may be a governmental unit for purposes of specific tort-immunity under § 505.106; the statute distinguishes immunity from liability (non-tort claims) and immunity from suit (tort claims) and bars jurisdiction only for tort claims.
- Court’s analysis: EDCs are not political subdivisions and not inherently immune; § 505.106(b) creates a governmental unit status for tort claims, but only for purposes of Chapter 101 and does not shield a breach of contract claim; § 505.106(a) provides immunity from liability for claims arising from governmental functions, which does not defeat subject-matter jurisdiction; the trial court correctly denied the plea to the jurisdiction.
- Conclusion: LVEDC is a governmental unit for interlocutory-appeal purposes but not a political subdivision or generally immune from suit; the breach of contract claim does not fall within § 505.106(b)’s tort-immunity; the trial court’s denial of the plea to the jurisdiction is affirmed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Is LVEDC a governmental unit for interlocutory appeal under §51.014(a)(8)? | LVEDC contends it is a governmental unit. | Little argues LVEDC lacks governmental-unit status. | Yes; LVEDC is a governmental unit for interlocutory appeal. |
| Does §505.106 provide immunity from suit for a breach of contract claim against an EDC? | LVEDC relies on immunity from suit under §505.106(b) for breach claims. | Little asserts §505.106(b) only applies to tort claims. | No; §505.106(b) applies to tort claims; breach of contract is not barred from suit by §505.106(b); immunity from liability under §505.106(a) does not affect subject-matter jurisdiction. |
| Can LVEDC raise governmental-immunity defenses to defeat jurisdiction on a non-tort breach of contract claim? | LVEDC argues immunity from liability bars the suit. | Little argues jurisdiction remains despite immunity from liability. | No; immunity from liability does not negate jurisdiction; the court lacks basis to dismiss for lack of jurisdiction. |
Key Cases Cited
- LTTS Charter Sch., Inc. v. C2 Constr., Inc., 342 S.W.3d 73 (Tex. 2011) (defines governmental unit status for interlocutory appeal and open-characterization of charter schools)
- Tex. Dep’t of Parks & Wildlife v. Miranda, 133 S.W.3d 217 (Tex. 2004) (subject-matter jurisdiction, de novo review for jurisdiction questions)
- Tooke v. City of Mexia, 197 S.W.3d 325 (Tex. 2006) (immunity related to jurisdiction and non-jurisdictional defenses)
- City of Galveston v. State, 217 S.W.3d 466 (Tex. 2007) (immunity from suit principles for governmental units)
- Weir Bros., Inc. v. Longview Econ. Dev. Corp., 373 S.W.3d 841 (Tex. App.—Dallas 2012) (EDC immunity discussed; distinguishes tort vs. non-tort claims)
- Purdin v. Copperas Cove Econ. Dev. Corp., 143 S.W.3d 290 (Tex. App.—Waco 2004) (discusses EDC immunity in context of tort claims)
- Rayl v. Borger Econ. Dev. Corp., 963 S.W.2d 109 (Tex. App.—Amarillo 1998) (addresses EDC immunity for tort claims)
- Ben Bolt-Palito Blanco Consol. Indep. Sch. Dist. v. Tex. Subdivisions Prop./Cas. Joint Self-Ins. Fund, 212 S.W.3d 320 (Tex. 2006) (immunity and governmental unit concepts)
- City of Rockwall v. Hughes, 246 S.W.3d 621 (Tex. 2007) (statutory interpretation and governmental-entity analysis)
- Laidlaw Waste Sys. (Dall.), Inc. v. City of Wilmer, 904 S.W.2d 656 (Tex. 1995) (statutory interpretation and purpose-of-words principle)