LTTS Charter School, Inc. v. C2 Construction, Inc.
358 S.W.3d 725
Tex. App.2012Background
- Universal Academy hired C2 Construction to build facilities at a Dallas County site leased by the Academy; dispute arose over unpaid work and alleged liens.
- C2 filed suit April 4, 2006 asserting breach of contract, quantum meruit, lien enforcement, interest, attorney's fees, and a §1983 claim styled as deprivation of rights under color of state law.
- Universal Academy answered with a general denial and asserted sovereign immunity; it later nonsuited its counterclaims and filed a plea to the jurisdiction.
- The trial court denied the plea; on appeal, the Dallas Court of Appeals initially dismissed for lack of government unit status under the Tort Claims Act, but the Texas Supreme Court reversed and remanded for merits review.
- On remand, the court addressed whether Universal Academy has governmental immunity, whether immunity was waived by counterclaims or under Local Government Code §271.152, whether it performs proprietary functions, and whether the §1983 claim survives; the court held immunity exists except as to the §1983 claim and offsetting claims, and remanded for further proceedings.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Is Universal Academy entitled to governmental immunity from suit? | Universal Academy argues immunity from suit under education code and common law. | C2 contends only liability immunity exists and does not extend to suit immunity; contract and exclusions apply. | Universal Academy has governmental immunity from suit except as to offsetting, germane, defensively linked claims. |
| Did dismissal of counterclaims restore immunity from suit? | Albert says non-suiting reasserts immunity. | Non-suiting cannot resurrect immunity for offsetting claims; trial court retains jurisdiction for those claims. | No immunity restoration for offsetting, germane claims after non-suit; limited immunity remains. |
| Was immunity waived under Tex. Local Gov't Code § 271.152 based on a written contract? | Written contract existed; board action and execution indicate waiver. | No signed written contract; unsigned draft contract and execution issues mean no waiver. | No waiver under §271.152 since there was no properly executed written contract. |
| Does the proprietary-governmental function distinction apply to this charter school case? | Charter school operations may be proprietary; subleasing to Satori shows private use. | Record fails to show proprietary function; premises used for education purposes. | Record does not establish a fact question of proprietary function; doctrine not satisfied. |
| Does §1983 claim survive immunity from suit? | C2's §1983 claim is grounded in deprivation of federal rights. | §1983 claim lacks basis in contract; some overlap with contract claims. | §1983 claim survives; court upheld denial of immunity for that claim and affirmed as to offsetting related claims. |
Key Cases Cited
- LTTS Charter Sch., Inc. v. C2 Constr., Inc., 342 S.W.3d 73 (Tex.2011) (reversed dismissal; charter schools as governmental units for interlocutory appeal)
- Tooke v. City of Mexia, 197 S.W.3d 325 (Tex.2006) (boundaries of sovereign immunity defined)
- City of Galveston v. State, 217 S.W.3d 466 (Tex.2007) (boundaries of governmental immunity determined by judiciary)
- Miranda v. D.N.R.D.C., 133 S.W.3d 217 (Tex.2004) (jurisdictional pleas reviewed de novo; pleadings construed in claimant's favor)
- Albert v. City of Dallas, 354 S.W.3d 368 (Tex.2011) (offsetting claims; non-suit does not restore immunity for offsetting claims)
- Clear Channel Outdoor, Inc. v. City of Houston, 233 S.W.3d 441 (Tex.App.-Hou. [14th Dist.] 2007) (execution of contract by government entity; last-step completion)
- City of Irving v. Seppy, 301 S.W.3d 435 (Tex.App.-Dallas 2009) (pleading burden on proving jurisdictional facts)