Lubbock County Water Control & Improvement District v. Church & Akin, L.L.C.
442 S.W.3d 297
| Tex. | 2014Background
- Water District leased Buffalo Springs Lake marina to Church & Akin for three years; lease restricted use to marina, restaurant, gasoline and sundry sales, with consent required for other uses and not unreasonably withheld.
- Lease required Church & Akin to pay $3,000 annual rent plus 5% of gross non-gas sales; catering tickets were provided to be redeemed at $1 each.
- Church & Akin could extend the lease for up to five additional five-year terms if in compliance with the lease; district later terminated the lease six months after accepting the following year’s rent.
- Church & Akin sued for breach of contract; Water District asserted governmental immunity and argued Chapter 271 waiver did not apply; Church & Akin amended pleadings to assert waiver.
- Trial court denied the plea to the jurisdiction; intermediate appellate court held that Chapter 271 waived immunity for breach of the lease; Texas Supreme Court granted review to resolve the waiver issue.
- Court held that the lease did not contain an “agreement for providing services” to the Water District, so Chapter 271 does not waive immunity; claims dismissed for lack of jurisdiction.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Does the lease include an agreement for providing services to the Water District under Chapter 271? | Church & Akin argues the lease includes marina operation and related services. | Water District argues the lease is solely a property lease, not a services contract. | No; lease did not require marina-operation services to the District. |
| Do catering tickets constitute an agreement to provide catering-ticket services to the District? | Lease language supports an obligation to issue catering tickets. | Provision is a benefit to lessee, not a contractual obligation to the District. | No; catering-ticket language does not state essential terms of providing catering-ticket services to the District. |
| Does the 5% non-gas sales rent create an obligation to provide services to the District? | Rent tied to sales indicates a service obligation to operate the marina. | Rent is a revenue mechanism, not a service obligation. | No; payment of rent does not create a contractual service obligation. |
Key Cases Cited
- Kirby Lake Dev., Ltd. v. Clear Lake City Water Auth., 320 S.W.3d 829 (Tex.2010) (waiver must be clear; benefits must be direct or essential terms)
- Coinmach Corp. v. Aspenwood Apartment Corp., 417 S.W.3d 909 (Tex.2013) (services to owner must be direct; mere provision to tenants not a contract for services to owner)
- Universal Health Servs., Inc. v. Renaissance Women’s Grp., P.A., 121 S.W.3d 742 (Tex.2003) (lease provisions restricting use do not by themselves create service obligations)
- Ben Bolt-Palito Blanco Consol Indep. Sch. Dist. v. Tex. Political Subdivisions Prop./Cas. Joint Self-Ins. Fund, 212 S.W.3d 320 (Tex.2006) (immunity/waiver analysis; policy for clear language)
- Tooke v. City of Mexia, 197 S.W.3d 325 (Tex.2006) (immunity concepts; waiver only by clear language)
- Wichita Falls State Hosp. v. Taylor, 106 S.W.3d 692 (Tex.2003) (distinguishing immunity from liability vs. immunity from suit)
- Sharyland Water Supply Corp. v. City of Alton, 354 S.W.3d 407 (Tex.2011) (waiver scope for contract-with-essentials under §271.151(2)(A))