Engelman Irrigation District v. Shields Bros., Inc.
514 S.W.3d 746
| Tex. | 2017Background
- In 1992 Shields Brothers sued Engelman Irrigation District for breach of contract; a Hidalgo County jury awarded damages and the 1997 court of appeals affirmed (the Engelman I judgment), and the Texas Supreme Court denied review in 1998.
- Engelman did not satisfy the judgment and later sought bankruptcy authorization and other relief; those efforts were denied and affirmed on appeal (Engelman II).
- In 2006 this Court decided Tooke v. City of Mexia, overruling prior precedent that "sue and be sued" language waived governmental immunity.
- Engelman then sued in 2010 (Engelman III) seeking a declaratory judgment that the Engelman I judgment was void under Tooke because Engelman had sovereign immunity and the original court lacked subject-matter jurisdiction.
- The trial court and the court of appeals rejected the collateral attack; the Supreme Court affirms, holding finality/res judicata bars reopening the long-final judgment despite Tooke.
Issues
| Issue | Plaintiff's Argument (Engelman) | Defendant's Argument (Shields) | Held |
|---|---|---|---|
| Retroactive effect of Tooke on final judgments | Tooke should apply retroactively to void Engelman I because immunity existed all along | Finality/res judicata prevents collateral attack on a long-final judgment | Tooke applies retroactively only to cases still pending on direct review; it does not permit collateral attack on a final judgment |
| Does sovereign immunity equal lack of subject-matter jurisdiction for all purposes? | Immunity meant the Engelman I court lacked jurisdiction, so that judgment is void | Sovereign immunity "implicates" but does not always equal lack of subject-matter jurisdiction; labeling it jurisdictional for all purposes would make final judgments perpetually vulnerable | Sovereign immunity implicates jurisdiction but is not coextensive with jurisdiction for all purposes; final judgments remain intact |
| Res judicata and relitigation of jurisdictional issues | Subsequent change in law (Tooke) warrants reopening the judgment | Res judicata, claim and issue preclusion, and Restatement §12 support finality, especially where jurisdiction was contested and court was of general jurisdiction | Res judicata bars collateral attack; where jurisdiction was litigated in a court of general jurisdiction, the earlier determination is conclusive |
| Separation of powers / legislative waiver concerns | Applying Tooke only prospectively would improperly intrude on Legislature’s power to waive immunity | Judicial protection of final judgments preserves separation of powers; legislative retroactive reopening risks violating Plaut | Courts—not the Legislature—decide retroactivity as applied to final judicial judgments; permitting reopening would raise separation-of-powers problems |
Key Cases Cited
- Tooke v. City of Mexia, 197 S.W.3d 325 (Tex. 2006) (overruled prior "sue and be sued" waiver rule)
- Texas Dep't of Parks & Wildlife v. Miranda, 133 S.W.3d 217 (Tex. 2004) (sovereign immunity deprives trial court of subject-matter jurisdiction in certain suits)
- Dubai Petroleum Co. v. Kazi, 12 S.W.3d 71 (Tex. 2000) (discussing modern limits on attacking final judgments for alleged lack of subject-matter jurisdiction)
- Plaut v. Spendthrift Farm, Inc., 514 U.S. 211 (1995) (Congress may not retroactively reopen final judicial decisions without violating separation of powers)
- Chicot Cnty. Drainage Dist. v. Baxter State Bank, 308 U.S. 371 (1940) (federal precedent limiting retroactive application of new rules to cases already finally adjudicated)