571 S.W.3d 738
Tex.2019Background
- Rosenberg Development Corporation (RDC) is a Type B economic development corporation created under the Texas Development Corporation Act to promote economic development; RDC contracted to pay Imperial Performing Arts $500,000 for renovation/operation of two arts venues.
- Imperial completed one project with an extension but stopped work on the theater project after RDC allegedly refused a requested extension and amendment; Imperial sued for breach of contract and declaratory relief.
- RDC filed a plea to the jurisdiction asserting various immunity defenses (immunity from suit and from liability), and sought dismissal; the trial court denied most relief and the court of appeals affirmed.
- The court of appeals held RDC was not immune from suit for the non-tort claims and interpreted Tex. Loc. Gov't Code §505.106 as limiting damages (liability) for governmental-function torts, not conferring immunity from suit for non-tort claims.
- The Supreme Court granted review to decide whether municipally created economic development corporations are governmental entities entitled to governmental immunity from suit.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether an economic development corporation (EDC) is a governmental entity entitled to governmental immunity from suit | Imperial: RDC is not entitled to governmental immunity; suit may proceed | RDC: As a municipally created EDC, it shares governmental immunity and thus its plea to the jurisdiction should be sustained | Held: No. EDCs are not political subdivisions or arms of the state and do not independently possess governmental immunity from suit; affirm court of appeals |
| Whether §505.106 of the Development Corporation Act grants immunity from suit (vs. limits liability) | Imperial: §505.106 limits remedies/liability for certain governmental-function torts but does not confer immunity from suit for non-tort claims | RDC: §505.106 and related provisions effectively shield EDCs from suit | Held: §505.106 limits damages/liability for governmental-function torts and treats Type B corporations as governmental units for Tort Claims Act purposes, but it does not grant immunity from suit for non-tort contract claims |
| Whether the interlocutory order denying RDC's plea to the jurisdiction was appealable | Imperial: interlocutory appeal statute applies only if entity is a "governmental unit" as defined; RDC arguably not included | RDC: §505.106(b) makes a Type B corporation a "governmental unit" for Chapter 101, making the interlocutory appeal proper | Held: Appealable. §505.106(b) makes Type B corporations "governmental units" for Chapter 101, so interlocutory appeal under §51.014(a)(8) was proper |
Key Cases Cited
- Wasson Interests, Ltd. v. City of Jacksonville, 489 S.W.3d 427 (Tex. 2016) (discusses modern rationales and scope of sovereign/governmental immunity)
- 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) (analyzes statutory indicia showing an entity is a distinct governmental unit entitled to immunity)
- Brown & Gay Eng'g, Inc. v. Olivares, 461 S.W.3d 117 (Tex. 2015) (rejects argument that performing public-purpose work alone establishes governmental-entity status)
- Tooke v. City of Mexia, 197 S.W.3d 325 (Tex. 2006) (explains governmental immunity doctrine and its limits)
- Fort Worth Transp. Auth. v. Rodriguez, 547 S.W.3d 830 (Tex. 2018) (distinguishes immunity-from-liability statutes from immunity-from-suit and treats statutory caps as remedy limitations)
- Weir Bros., Inc. v. Longview Econ. Dev. Corp., 373 S.W.3d 841 (Tex. App.-Dallas 2012) (example of an appellate decision treating similar entity as lacking jurisdictional immunity for certain claims; discussed and distinguished)