Jerry Laza v. City of Palestine, Texas, 06-18-00051-CV

Background

The City of Palestine sued Jerry Laza for violating city ordinances by operating junk/salvage yards and maintaining vehicles, equipment, trash, and unsanitary conditions on multiple properties; it sought civil penalties and injunctive relief.
Laza filed multiple counterclaims (including federal constitutional claims and TOMA claims). The trial court severed newly added counterclaims into a separate cause, DCCV16-356-349A.
The City removed the severed cause to federal court; Laza argued removal divested the state court of jurisdiction over the entire case. The federal court and the state record showed only the severed counterclaims were removed.
The state trial proceeded on the City’s non-severed claims; a jury found multiple ordinance violations and the trial court entered judgment awarding $163,155 in penalties and injunctive relief.
On appeal Laza challenged (inter alia) post-removal jurisdiction, the city attorney’s authority (Tex. R. Civ. P. 12), the trial court’s denial of special exceptions, the jury-charge burden of proof, denial of a recusal motion, and alleged record fabrication; the Court of Appeals rejected each challenge and affirmed.

Issues

Issue	Laza's Argument	City's Argument	Held
Jurisdiction after severance/removal	Removal of DCCV16-356-349A divested state court of jurisdiction over entire case, rendering state proceedings void	Only the severed counterclaims (349A) were removed; the state court retained jurisdiction over the non-severed claims (349)	Only the severed cause was removed; trial court retained jurisdiction; state judgment valid
Rule 12 (show authority of city attorney)	City attorney lacked authorization because city council never passed an ordinance/resolution specifically authorizing this suit	City charter broadly authorizes the city attorney to represent the city in all litigation; testimony and circumstances show actual/implied authority	Trial court did not abuse discretion denying Rule 12 motion; city attorney had implied/actual authority
Special exceptions to City's pleadings	City's pleadings failed to plead a cause of action and did not give fair notice	City repleaded; the live pleading at trial was the third amended petition and Laza failed to specially except to it or obtain rulings	Laza waived these complaints by failing to except to the live (third amended) petition and obtain rulings
Jury-charge burden of proof	Civil penalties and injunctive relief require clear-and-convincing evidence, not preponderance	No timely, specific objection/request to require clear-and-convincing instruction was made at charge conference	Complaint waived; no preserved error—preponderance instruction stands
Motion to recuse / timeliness	Trial judge’s preparatory actions and comments required recusal; administrative judge erred in denying recusal	Motion was untimely and not filed as soon as practicable after movant knew grounds; Rule 18a requirements not met	Motion untimely; presiding judge properly denied recusal; issue waived if Rule 18a not complied with
Motion to vacate judgment / record fabrication	Record contains fabricated documents and judicial misconduct warranting vacatur and new trial	Trial court held two evidentiary hearings and found no significant errors or omissions; appellate record adequate	No basis to vacate; trial court findings adopted and appeal affirmed

Key Cases Cited

Briscoe v. Goodmark Corp., 102 S.W.3d 714 (Tex. 2003) (explains law-of-the-case doctrine and its exceptions).
City of Houston v. Jackson, 192 S.W.3d 764 (Tex. 2006) (discusses law-of-the-case principles applied to subsequent stages).
McRoberts v. Ryals, 863 S.W.2d 450 (Tex. 1993) (severance order effective when signed; severance divides a suit into independent causes).
City of San Antonio v. Aguilar, 670 S.W.2d 681 (Tex. App.—San Antonio 1984) (city attorney’s charter authority can imply authority to pursue litigation without separate council resolution).
FKM P’ship, Ltd. v. Bd. of Regents of Univ. of Houston Sys., 255 S.W.3d 619 (Tex. 2008) (amended pleadings supersede prior pleadings).
Burbage v. Burbage, 447 S.W.3d 249 (Tex. 2014) (preservation rule for jury-charge error requires timely, specific objection and ruling).