Houston Independent School District v. Morris, 355 S.W.3d 668

Background

Taxpayers were listed as owners of 10.34 acres (9.38 owned by taxpayers; .96 not owned).
Taxing Units sued for delinquent taxes on 1983–2003; a lien was placed on the properties.
Taxpayers paid the disputed taxes under protest to stop penalties and foreclosures, then sued for a refund of the .96 acres’ taxes.
Taxpayers asserted they never owned the .96 acres and sought refund via declaratory relief; Taxing Units asserted governmental immunity, exhaustion, and other defenses.
Trial court denied the plea to the jurisdiction; the issue on appeal is whether exhaustion of administrative remedies required by the Tax Code bars the claims.
Court addresses whether Tax Code § 42.09 exhaustion applies to nonownership challenges and whether § 42.09(b) allows an affirmative defense post-nonsuit.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Does exhaustion apply to nonownership protests under § 42.09(a)?	Taxpayers argue nonownership protests fall within 41.41(a)(7) and require exhaustion.	Taxing Units contend § 42.09(a) exhaustion is required for all protest grounds.	Exhaustion required; district court lacked jurisdiction.
Who is a 'property owner' entitled to administrative challenge under § 41.41(a)(7)?	Taxpayers as listed owners have standing to protest ownership; nonowners cannot.	Taxing Units argue ordinary ownership governs protest rights.	Taxpayers are the 'property owner' under § 41.41(a)(7) as listed on rolls; exhaustion applies.
Does § 42.09(b) permit an affirmative defense for nonownership after nonsuit?	Taxpayers claim § 42.09(b) allows nonownership defense even if not a current defense.	§ 42.09(b) applies only as defense in a suit to collect delinquent taxes, not as a post-nonsuit affirmative relief claim.	§ 42.09(b) not applicable once the taxing units nonsuited; no affirmative defense remains.
Is the Tax Code exclusive, preventing non-protest grounds from being heard in court?	The grounds here are administrative protest grounds; otherwise court jurisdiction should not be barred.	Tax Code exclusivity bars non-protest claims outside administrative procedures.	Tax Code exclusivity applies; case dismissed for lack of administrative protest compliance.
Do implied duress or due process considerations salvage jurisdiction?	Taxes paid under implied duress could permit a refund suit.	Exhaustion and administrative remedies negate implied duress defenses; due process not violated here.	No due process salvage; exhaustion defeated duress-based or affirmative relief claims.

Key Cases Cited

Robstown Independent School District v. Anderson, 706 S.W.2d 952 (Tex. 1986) (failure to protest ownership precludes non-ownership defenses)
First Bank of Deer Park v. Harris County, 804 S.W.2d 588 (Tex.App.-Houston [1st Dist.] 1991) (exhaustion and duress rules; protest rights; voluntary-payment rule explored)
City of Pharr v. Boarder v. Boarder Trucking Serv., Inc., 76 S.W.3d 803 (Tex.App.-Corpus Christi 2002) (trial court may dispose of defense-related issues when non-ownership is defense)
Cameron Appraisal Dist., 194 S.W.3d 502 (Tex.App.-Houston [1st Dist.]) (exclusivity of protest procedures; section 42.09 controls; notice/ownership defenses)
Bolton v. City of Dallas, 185 S.W.3d 868 (Tex. 2005) (duress and voluntary-payments; statutory remedies supersede common-law defenses)
Nivens v. City of League City, 245 S.W.3d 470 (Tex.App.-Houston [1st Dist.] 2007) (governmental immunity not applicable when seeking illegal taxes refunded (duress context))
First Bank of Deer Park v. Harris County, 804 S.W.2d 588 (Tex.App.-Houston [1st Dist.] 1991) (see above; listed for duress and protest context)