Willacy Cnty. Appraisal Dist. v. Sebastian Cotton & Grain, Ltd., 555 S.W.3d 29

Background

Sebastian rendered grain inventory to Willacy County Appraisal District (WCAD) as its property for 2009 and sought a Freeport exemption (denied); WCAD appraised the inventory and assessed taxes accordingly.
After receiving the tax bill, Sebastian (through its agent Jurica) moved under Tex. Tax Code §25.25(c) to correct ownership, producing 2008 purchase confirmations showing sales to DeBruce; WCAD's chief appraiser orally agreed and changed the roll to list DeBruce, producing a refund to Sebastian.
DeBruce protested, presenting evidence (incorporating NGFA rules) that title passed on shipment and that much shipment occurred in January 2009 or was canceled; the chief appraiser then used §25.25(b) to change the roll back to list Sebastian as owner; WCARB upheld that correction and allocated values between the parties.
Sebastian sued, arguing §25.25(b) does not authorize ownership corrections that increase a taxpayer's liability and that the earlier oral agreement under §1.111(e) was final and unreviewable; WCAD defended on grounds the agreement was fraudulently induced and therefore voidable.
The trial court found Sebastian had fraudulently misrepresented ownership and voided the §1.111(e) agreement; the court of appeals reversed as to §25.25(b) authority and remanded on fees; the Texas Supreme Court granted review.

Issues

Issue	Plaintiff's Argument (Sebastian)	Defendant's Argument (WCAD)	Held
1. Scope of §25.25(b): May chief appraiser correct ownership when correction changes who taxing units expect to pay taxes?	§25.25(b)'s clause “does not increase the amount of tax liability” applies to each listed correction; chief appraiser cannot change ownership if that increases an individual taxpayer's liability.	The restrictive clause modifies only the final item (clerical errors) and/or refers to increases in the property’s assessed tax (appraised value), not who will be billed; corrections of ownership that do not change appraised value are authorized.	Court holds §25.25(b) authorizes ownership corrections where the correction does not increase the tax liability attached to the property (i.e., does not change appraised value); ownership correction here was authorized.
2. Validity of §1.111(e) oral agreement if induced by fraud: Can a §1.111(e) agreement be voided for fraud?	The oral §1.111(e) agreement between Sebastian (or its agent) and the chief appraiser was final and precludes subsequent change.	Even if an agreement existed, an agreement procured by fraud can be voided; the chief appraiser need not be bound by a fraudulently induced agreement.	Court holds §1.111(e) agreements may be voidable for fraud; courts may consider fraud as an affirmative defense in a trial de novo.
3. Effect of §1.111(e) agreement on legal ownership	The §1.111(e) agreement resolved ownership as a legal matter and is final.	A chief appraiser’s agreement can change the appraisal roll but cannot conclusively determine legal ownership; actual ownership remains a legal question.	Court holds §1.111(e) agreements cannot determine legal ownership conclusively; they only resolve appraisal-roll treatment and are subject to attack for fraud.
4. Attorney's fees under §42.29: Is Sebastian entitled to fees for prevailing on appeal?	Sebastian, as prevailing party, is entitled to attorney’s fees under §42.29 for a §25.25 appeal.	§42.29 fees are limited to appeals that originate from motions under §25.25(c) or (d) (those that produce ARB determinations); a chief appraiser correction under §25.25(b) does not trigger §42.29.	Court holds Sebastian is not entitled to attorney's fees under §42.29 because this dispute arose from a §25.25(b) chief-appraiser correction (not a §25.25(c)/(d) motion that produced an ARB determination).

Key Cases Cited

Tex. Lottery Comm'n v. First State Bank of DeQueen, 325 S.W.3d 628 (Tex. 2010) (statutory construction: give effect to legislative intent and plain text)
City of Rockwall v. Hughes, 246 S.W.3d 621 (Tex. 2008) (use of ordinary meaning and context in interpreting statutes)
TGS-NOPEC Geophysical Co. v. Combs, 340 S.W.3d 432 (Tex. 2011) (Legislature's deliberate word choice guides statutory meaning)
Sullivan v. Abraham, 488 S.W.3d 294 (Tex. 2016) (canons of construction: series-qualifier and last-antecedent rules)
Italian Cowboy Partners, Ltd. v. Prudential Ins. Co. of Am., 341 S.W.3d 323 (Tex. 2011) (fraudulent inducement can render a contract voidable)
Dall. Cent. Appraisal Dist. v. Seven Inv. Co., 835 S.W.2d 75 (Tex. 1992) (narrow construction of §42.29 attorney-fee statute)