TEXAS PROPANE GAS ASSOCIATION, PETITIONER, v. THE CITY OF HOUSTON, RESPONDENT
No. 19-0767
IN THE SUPREME COURT OF TEXAS
April 16, 2021
622 S.W.3d 791
On Petition for Review from the Court of Appeals for the Third District of Texas. Argued October 29, 2020.
JUSTICE BLACKLOCK filed an opinion concurring in part and dissenting in part, in which JUSTICE BOYD joined.
Texas comprehensively regulates the liquefied petroleum gas (LPG)1 industry
I
The State has regulated the LPG industry for more than 60 years. In 1959, the Legislature enacted the LPG Code,7 which directed the Railroad Commission to “promulgate and adopt . . . adequate rules, regulations, and/or standards pertaining to any and all aspects or phases of the LPG industry . . . which will protect or tend to protect the health, welfare, and safety of the general public.”8 In response, the Commission has adopted comprehensive statewide LPG regulations9 that the parties refer to as the LP-Gas Safety Rules. The LP-Gas Safety Rules prescribe various monetary penalties for violations.10 In 2011, the Legislature added
The rules and standards promulgated and adopted by the commission under Section 113.051 preempt and supersede any ordinance, order, or rule adopted by a political subdivision of this state relating to any aspect or phase of the liquefied petroleum gas industry. A political subdivision may petition the commission‘s executive director for permission to promulgate more restrictive rules and standards only if the political subdivision can prove that the more restrictive rules and standards enhance public safety.11
Four years later, the City adopted three ordinances amending its Fire Code,12 which is modeled on the 2012 International Fire Code. The amended Code now includes Chapter 61, entitled “Liquefied Petroleum Gases“.13 This was the City‘s first venture into regulating activities involving LPG. The Code imposes monetary penalties for a violation that range from $500 to $2,000 per day.14
TPGA brought a declaratory judgment action against the City of Houston and several other cities,15 asserting the defendants’ local LPG regulations have not been approved by the Commissioner‘s executive director and, under
TPGA‘s pleadings assert that “[o]ne or more of [its] members have been adversely affected by” the City‘s enactment of local regulations that differ from the LP-Gas Safety Rules and describe five instances in which the City has enforced LPG regulations that differ from the LP-Gas Safety Rules. In four of the five, it is unclear whether the incident involved one of TPGA‘s members. The fifth example involves a member who was charged $2,180 in permit fees for installing an LPG tank in a manner that violated the amended Fire Code, even though the installation complied with the LP-Gas Safety Rules.
The parties filed cross-motions for summary judgment on the merits. The City‘s motion also included a plea to the jurisdiction. The trial court denied both sides’ motions and the City‘s plea to the jurisdiction. The City appealed the trial court‘s
We granted TPGA‘s and the City‘s petitions for review. We begin with the City‘s criminal law argument and then turn to its standing argument. It bears emphasizing that the merits of TPGA‘s preemption claims are not at issue here—only its right to proceed on them.
II
A
The Texas Constitution prohibits city ordinances that conflict with state law.20 In City of Laredo v. Laredo Merchants Association, we held that “a local antilitter ordinance prohibiting merchants from providing ‘single use’ plastic and paper bags to customers for point-of-sale purchases” was preempted by the Texas Solid Waste Disposal Act and therefore invalid. 550 S.W.3d 586, 589 (Tex. 2018). We concluded that the Merchants Association challenging the ordinance was entitled to declaratory relief.22
Just like the LPG ordinances in the present case, the City of Laredo‘s ordinance punished violations with monetary fines.23 The City of Laredo did not contest the trial court‘s jurisdiction over the suit, but the City of Houston did, as amicus curiae, making exactly the same argument it makes now: that because the ordinance was “penal in nature“, it could be challenged “only in defense to a criminal prosecution for violating it.”24 The City centered its argument on our decision in State v. Morales, where we held that the trial court lacked jurisdiction over a declaratory judgment action challenging the constitutionality of the Texas statute criminalizing sodomy. 869 S.W.2d 941, 942 (Tex. 1994). “It is well settled,” we wrote, “that courts of equity will not interfere with the ordinary enforcement of a criminal statute unless the statute is unconstitutional and its enforcement will result in irreparable injury to vested property rights.”26 “The underlying reason for this rule,” we explained, “is that the meaning and validity of a penal statute or ordinance
Morales distinguished our decision a century earlier in City of Austin v. Austin City Cemetery Association, 28 S.W. 528 (Tex. 1894). There, the Cemetery Association challenged an ordinance prohibiting burials within the Austin city limits north of the Colorado River except in the State Cemetery, the Austin City Cemetery, and the Mount Calvary Cemetery.30 We held that the trial court had jurisdiction to enjoin enforcement of the ordinance, despite the “general rule” that “the aid of a court of equity cannot be invoked to enjoin criminal prosecutions.”31 Though the ordinance could be challenged in a criminal prosecution or on habeas corpus, we acknowledged, “[a] criminal prosecution is unpleasant to all people who have due respect for the law, and almost necessarily involves inconvenience and expense.”32 As a result, “[a]s long as the ordinance remains undisturbed, it acts in terrorem, and practically accomplishes” its goal by only threatening enforcement.33 Unless the ordinance was restrained, it could “result in a total destruction of the value of [the Cemetery Association‘s] property for the purpose for whiсh it was acquired.”34 The sodomy statute challenged in Morales posed no such threat, we explained, because it was not being enforced; there was “no record of even a single instance in which the sodomy statute ha[d] been prosecuted against conduct that the plaintiffs claim[ed] [was] constitutionally protected“.35
Unlike the statute in Morales, the antilitter ordinance in City of Laredo threatened irreparable injury to vested property rights in a way similar to the ordinance in City of Austin. The City of Laredo‘s ordinance “impose[d] a substantial per-violation fine that effectively preclude[d] small local businesses from testing the ban‘s constitutionality in defense to a criminal prosecution.”36 Morales was thus no impediment to the trial court‘s jurisdiction over the Merchants Association‘s suit for declaratory relief.
With more rhetoric than logic, the City of Houston insists that City of Laredo should not be followed and was wrongly decided. The City dismisses our jurisdictional holding as dicta. But a jurisdictional holding can never be dicta because subject-matter jurisdiction must exist before we can consider the merits, a challenge to it cannot be waived, and “we have an obligation to examine our jurisdiction any time it is in doubt“.37 The City argues that City of Laredo is directly contrary to Morales, even though the sodomy statute at issue in Morales was never enforced, and
In sum, just as in City of Laredo, the City‘s LPG rеgulations threaten irreparable injury to vested property rights.
B
The City‘s jurisdictional argument also fails because TPGA‘s lawsuit is not a “criminal law matter” outside a Texas civil court‘s subject-matter jurisdiction.
The Texas Constitution bifurcates the civil and criminal law jurisdiction of the State, giving the Court of Criminal Appeals appellate jurisdiction “in all criminal cases”38 and this Court appellate jurisdiction “except in criminal law matters“.39 In Heckman v. Williamson County, we held that to determine the boundary between civil and criminal jurisdiction, courts must “loоk to the essence of the case to determine whether the issues it entails are more substantively criminal or civil.” 369 S.W.3d 137, 146 (Tex. 2012). Disputes “aris[ing] over the enforcement of statutes governed by the Texas Code of Criminal Procedure” or “as a result of or incident to a criminal prosecution” are usually criminal law matters.41 But the mere existence of some criminal-law question, characteristic, or context will not transform a dispute that is fundamentally civil into a criminal law matter.42
In Harrell v. State, for example, Harrell contended that a trial court order directing the Texas Department of Criminal Justice to withdraw money from his inmate trust account to pay for court costs and attorney fees violated due process. 286 S.W.3d 315 (Tex. 2009).43 We had jurisdiction to decide the merits because the case was “more civil in nature than criminal.”44 We reasoned that the withdrawal order was issued years after Harrell‘s conviction; that the Government Code provision authorizing the order also authorized withdrawal for costs incurred in civil proceedings; that neither Harrell‘s guilt nor his punishment was at issue; and that the case was “substantively akin to a garnishment action or an action to obtain a turnover order.”45
The “essence” test articulated in Heckman requires a holistic, common-sense analysis. The essence of this case is a dispute over the City‘s legal authority to regulate a specific category of commercial activity, the LPG industry. TPGA‘s primary substantive claim is that
Though violating the City‘s LPG regulations may result in a criminal proceeding or monetary penalty, that fact is merely incidental to the legal issue TPGA raises. Accepting the City‘s argument would allow a political subdivision to evade a preemption challenge by cloaking its commerсial regulations with criminal features. And it would result in the anomaly of civil courts having jurisdiction to adjudicate the validity of local LPG regulations that do not carry criminal penalties but no jurisdiction to adjudicate local regulations that do.
Both Morales and City of Laredo repeated the rule that a civil court has jurisdiction to declare a criminal statute invalid only when irreparable injury to vested property rights is threatened.46 Viewed in the context of our case law as a whole, the rule is but a corollary to the ultimate test articulated in Heckman: looking to the essence of the case, are the issues presented more substantively civil or criminal? Protection of property rights is a core civil-law function.47 In a suit challenging the constitutionality of a criminal statute, the threat of irreparable injury to property rights may tip the scales in favor of the matter being a civil one.
The essence of this case is civil, as was the essence of City of Laredo. Accordingly, this case is within the trial court‘s subject-matter jurisdiction.
III
The City challenges TPGA‘s standing to assert its claim that the City‘s regulations are preempted by
The City did not specially except to TPGA‘s pleadings but instead challenged its standing by motion for summary judgment. Our procedural law is quite clear that “[w]hen a party fails to specially except, courts should construe the pleadings liberally in favor of the pleader. An opposing party should use special exceptions to identify defects in a pleading so that they may be cured, if possible, by amendment.”52 We think that TPGA‘s pleadings, read liberally, show that it has satisfied the injury requirement for standing: its members face the actual and imminent burden of inconsistent regulations that
We agree with the dissent that standing rеquirements should be rigorously applied and that Texas law and federal law are parallel. We also agree with the dissent that “[a]s a practical matter, it seems likely that the members of the Texas Propane Gas Association face injury or threatened injury from most—if not all—of Houston‘s LPG regulations.”53 According to TPGA‘s pleadings, the City‘s mayor and city attorney promised them exactly that. We disagree that TPGA failed to allege an actual and imminent injury. We agree with the dissent that a plaintiff cannot challenge a broad array of regulations, or even a companion regulation, without showing standing as to each. We agree, to be specific, with In re Gee, 941 F.3d 153 (5th Cir. 2019).54 But Gee was, as the opinion said in its first sentence, “an extraordinary case.”55 There, “[a]n abortion clinic and two of its doctors [sought] a federal injunction against virtually all of Louisiana‘s legal framework for regulating abortion“, challenging “legal provisions that do not injure them now and could not ever injure them.”56 But that is far different from this case. TPGA challenges thе City‘s amendments to its Fire Code for reasons that TPGA also used to successfully advocate for the enactment of
TPGA has standing to assert its claim. Whether the law allows such a claim and, of course, whether TPGA can prevail on it are issues going to the merits, not standing.58
* * * * *
We conclude that the trial court does not lack jurisdiction on either ground asserted
Nathan L. Hecht
Chief Justice
Opinion delivered: April 16, 2021
Notes
When in this code an act is prohibited or is made or declared to be unlawful or an offense or misdemeanor, or wherever in this code the doing of any act is required or the failure to do any act is declared to be unlawful, and no specific penalty is provided therefor, the violation of any such provision of this code shall be punished by a fine of not less than $500.00, nor more than $2000.00; provided, however, that no penalty shall bе greater or lesser than the penalty provided for the same offense under the laws of the state. Each day any violation of this code shall continue shall constitute a separate offense.
Id. § 109.4.
- Houston Sections [A] 105.1.1, [A] 105.1.2, [A] 105.6.27, and 6101.2 relating to permits and fees are more restrictive than and, therefore, preempted by LP-Gas Safety Rule § 9.101;
- Houston Sections [A] 105.6.27, 6101.2, and 6103.3 relating to aggregate water capacity of LP-Gas containers are more restrictive than and, therefore, preempted by LP-Gas Safety Rule § 9.101;
- Houston Sections [A] 105.6.27 and 6101.3 rеlating to the required submission of applications and/or construction documents are more restrictive than and, therefore, preempted by LP-Gas Safety Rules §§ 9.3 and 9.101;
- Houston Sections 113.1 – 113.113.7 relating to fees are more restrictive than and, therefore, preempted by LP-Gas Safety Rules §§ 9.101 and 113.082;
- Houston Section 312 relating to barriers is more restrictive than and, therefore, preempted by LP-Gas Safety Rule § 9.140;
- Houston Sections 203.1 and 6104.2 relating to maximum storage capacity within certain districts of limitation are mоre restrictive than the LP-Gas Safety Rules because the LP-Gas Safety Rules impose no similar restriction in any area of limitation defined by Houston;
- Houston Sections [A] 104.1 and 104.1.1 relating to the authority of Houston‘s fire code official to enforce provisions of Houston‘s Fire Code, to render interpretations of any matter, and/or to exercise discretion with respect to any aspect or phase of the LP-Gas industry are more restrictive than the LP-Gas Safety Rules because the LP-Gas Safety Rules: (i) impose an enforcement regime, including various penalties, and (ii) delegate no enforcement authority to Houston‘s fire code official;
- Houston Section [A] 104.5 relating to the authority of Houston‘s fire code official to issue criminal citations, administrative citations, or summonses with respect to any aspect or phase of the LP-Gas industry for violation of any provision of the Houston Fire Code is more restrictive than the LP-Gas Safety Rules because the LP-Gas Safety Rules: (i) impose an enforcement regime, including various penalties, and (ii) delegate no enforcement authority to Houston‘s fire code official;
- Houston Section [A] 105.3.1 relating to expiration of an LP-Gas permit is more restrictive than the LP-Gas Safety Rules because the LP-Gas Safety Rules grant no such authority to Houston; and
- Houston Section [A] 105.5 relating to revocation of an LP-Gas permit is more restrictive than the LP-Gas Safety Rules because the LP-Gas Safety Rules grant no such authority to Houston.