Travis County v. Pelzel & Associates, Inc.

Petitioner, COUNTY, Texas, TRAVIS ASSOCIATES,

PELZEL &

INC., Respondent.

No. 01-0036. of Texas.

Supreme Court Nov.

Argued 9, 2002. May

Decided

Rehearing Overruled June jurisdic- claim want of Pelzel’s

dismiss tion. County contracted Pelzel to

Travis an Austin. The building construct office substantial-completion date was original to labor short- but due October parties agreed to extend the ages, the parties dispute The now the ex- deadline. Oden, A. Shepperd, Ken Eric M. Todd deadline. substantial-completion tended Clark, Thomas, Travis Sherine Elizabeth County’s representative and the archi- The Austin, Attorney’s, Petitioner. directive, construction-change tect signed Baldwin, George Lloyd C. Gosselink substantial-completion setting a new date Hamilton, Rochelle, Blevins Kendall Dean as but Pelzel contends December Hamilton, Austin, for Law Office of Ken agreed acknowledged never Respondent. substantially completed directive. Pelzel building on the December 1994. Tra- Justice HANKINSON delivered the County accepted, occupied, vis and has Court, in opinion of the which Chief building Athough since that date. Travis PHILLIPS, HECHT, Justice Justice $414,164.80,it County paid Pelzel withheld OWEN, BAKER, Justice Justice Justice $5,500 alleged liquidated damages on O’NEILL, JEFFERSON, Justice did not grounds timely Pelzel joined. Justice RODRIGUEZ building. According to the complete Associates, Inc., Pelzel <& sued Travis clause, contract’s County, alleging county improper- retain each County could calendar $250 ly payment withheld full under a construc- day substantially complete Pelzel failed to Arguing tion contract. im- building beyond set for com- the date claim, munity bars Pelzel’s Travis pletion acceptance. plea jurisdiction, filed a which the presented a claim to the Travis trial denied. The court under affirmed, County Commissioners Court concluding that Travis 89.004,1 § Local seeking Government Code waived its fur- conduct. It contract, payment plus due under in- ther concluded that because com- $130,508.56 terest and in hindrance and plied with Texas Local Code Government delay damages. After § 89.004 refused presenting its claim to the claim, county Pelzel filed this suit commissioners court before suit, County filed a plea the trial court had 30 district court. Travis asserting sovereign 662. Local im- jurisdiction Government § sovereign munity. plea, 89.004 does not waive The trial court denied the an County brought from suit for a claim interlocu- County’s tory did under Practice appeal conduct Texas Civil & 51.014(a)(8). not waive its we re- Remedies Code The court appeals’ justice concurring, the court with one judgment appeals, verse R.S., 62, 13.03(b), brought presentment 76th ch. wording Laws was located Local Government Tex. Gen. clarity, has since For been renum- both sections identical. April bered as 89.004. Act of refer to both as section 89.004. affirmed, (1941); County- concluding that Travis see also conduct and that Loc. independent County’s Pel- properly by agent contract executed acting compliance zel’s county’s on behalf binds ute conferred trial govern contract for all But a purposes). granted court. 30 S.W.3d at 669. We entity immunity mental does not waive County’s petition Travis for review to de- simply contracting with by from suit a cide these two issues.2 party. Sign, 951 private Federal S.W.2d Express required at 408. consent is to A governmental a unit is immunity show that from suit has been im protected the doctrine of case, Id. Thus in Pelzel waived. must munity. Crv. PRAC. & Rem.Code Tex. County. establish consent to sue Travis 101.001(3)(B); Harris v. Ger consent, juris lacks Absent the trial court hart, 449, 139, 115 Tex. 283 S.W. 140 diction. (1926); County, Nussbaum v. Bell 97 Tex. 430, (1903); 86, Heigel 432 v. A consent party may establish 392, County, 84 19 Wichita Tex. S.W. Little- legislative statute or resolution. (1892). immunity en Sovereign Tex, 594; at 39 S.W.3d see also Crv. Tex. protect two compasses principles 101.025; §§ 107.001- Prao. & Rem.Codb governmental state and other entities in expressed by .005. The consent must be immunity damages: suits for from unambiguous language.” “clear and liability. from Federal 311.034; Sign, Federal 951 Univ., Sign v. Texas S. 951 S.W.2d 405; Barfield, City at S.W.2d of LaPorte (Tex.1997). liability, Immunity 405 from (Tex.1995); 898 291 Universi S.W.2d protects governmental entity a from ty Tex. Med. Branch at Galveston v. if Legislature express even judgments York, (Tex.1994); 177 Du S.W.2d suit, not affect a ly consents does court’s (Tex. State, hart v. subject-matter jurisdiction. Dep’t 1980). must Accordingly, we determine Jones, Transp. 8 S.W.3d by clear Legislature whether the (Tex.1999). contrast, if liability even is 89.004 unambiguous language section deprives undisputed, immunity a from against counties. suits subject-matter jurisdiction trial court Barfield, at 291 See 898 S.W.2d plea properly and is asserted a requirement clear-and-unambiguous jurisdiction. Id. applies govern waiving immunity governmental entity con state). mental entities other than private as party, tracts with Travis here, argues done liable on that section 89.004 County has sovereign immunity if it private party. contracts as were a waives suits complied In counties. Servs. Comm’n v. Little-Tex General Co., its claim presenting with the statute sulation 2001); 405; refused Sign, Federal the commissioners claim; Wood, contends that see Anderson 22.001(a)(1), 22.225(c) juris- justices (providing for appeals §§ disa- 2. Because the court of greed whether Government interlocutory over Local appeals when the diction over sovereign immunity waives from disagree “justices of the court of suit, we have this interlocu- over decision”). question of material law tory appeal. Gov't jurisdiction. trial court has Pelzel urges liability no of for the relief allowed under this Thus, basis chapter.” for waiver of immuni- pres- 554.0035. 89.004(a) ty. responds that because language entment of section does 89.004 does not and unam- go as far as from waiving biguously merely establishes a condition trial court lacks precedent to suit. See Farmers State Bank New Boston v. Bowie agree County. Section (1936) 89.004(a), Claim,” entitled “Presentation of (holding that the statutory language “indi- provides person may “[a] not sue on a rejection cates that the commission- person unless the ers’ court of a claim county, presented the claim to the commission- the failure of such court to act on the ers court and the commissioners court has same, merely a condition precedent neglected or refused pay part all or thereon”). the filing of a suit to recover claim.” Tex. Loc. Gov’t Code 89.004(a). § This Our statutory language comports construction pur does pose and unambiguously im- of the statute itself. waive See Tex. Gov’t 311.023(1) munity § from suit. (providing See that in con Code Gov’t Code statute, § 311.034. It only struing states a court party may that a consider the must attained). object present sought its claim to the be In Essen commissioners refuse, neglect, burg must v. Dallas (Tex.1998), all of the claim explained before the we party may pur file suit. 89.004(a); pose § presentment requirement see is to Tex. Loo. Gov’t Code 311.011(a) (“Words also § notify the commissioners court of a claim Tex. Gov’t phrases and shall be opportunity read context afford it an to investigate according construed settle the claim. gram- distinguished rules of mar and usage.”). common statute from the exhaustion- of-remedies requirement applicable to ad 89.004(a) Section stands in stark con- ministrative appeals, explaining that trast to other statutes that contain lan- exhaustion requirement seeks to assure guage which does clearly and unambigu- the appropriate body adjudicates a ously sovereign immunity from suit. dispute jurisdictional hallmark of a —the For example, The Texas Tort Claims Act statute. Id. We then held that Local Gov provides that “[sjovereign immunity to suit 81.041, ernment Code predecessor is waived and abolished to the extent of jurisdictional. is not liability created this chapter.” Tex. Civ. 101.025(a). This construction comports also PRAC. & Rem.Code Similarly, history. statute’s Private Real Property Rights Preser- 311.023(4) (providing that in construing vation Act states that “[sjovereign immuni- statute, may a court ty to suit consider former liability is waived and abol- provisions). Originally, ished to the the stat- liability extent of created ute contained “sue and be sued” language, chapter.” Gov’t 2007.004(a). arguably showing intent to waive sover- Further, the Whistleblower eign for suits Act counties: public allows a employee alleges who violation of the act to employing “sue the All brought by suits or against any of state or local governmental state, entity for the the counties of this shall be relief,” and states that “[sjovereign brought immu- in the name of or nity is waived and abolished to the extent [naming county], (Tex.1994) sued, they may name sue and be (stating that

plead impleaded, and be defend and be existing statutory provi omissions from defended, in any court of record or provisions sions when new are enacted are place justice may where be adminis- intentional). presumed to be Provided, however, tered: that no coun- Nor construed pres has this Court sued, ty unless the upon shall be to the contrary. entment statute founded shall suit is have first court of relied on several cases to been presented county court for support holding section 89.004 allowance, and such court shall have ne- sovereign immunity. waives But none of glected or refused to audit and allow the directly question those cases resolves same. presented example, here. For in Nolan Act of May 1st Paschal’s Simpson, 1044, 1045; Digest, see also Missouri Pac. (1889), although stated that Dist., R.R. Navigation Co. v. Brownsville the defendant “could have been (Tex.1970) (holding presented against county, and proceed containing “sue and sued” directs,” im ed with as the law suit). language provided consent to munity not at issue because the coun was Legislature deleted most ty brought Similarly, City the suit. statutory language and left text resem Shobe, Sherman v. bling “No county the current statute: shall (1900), any address did not whether upon claim sued unless the which such other suit must exist or basis for whether suit is pre founded shall have first been presentment waives sovereign statute county sented to the court commissioners’ Further, immunity. the case in did not allowance, and such court have shall county volve a against money, suit neglected audit or refused to and allow the proceedings involved garnishment any same thereof.” part. Tex. Rev. can, whether in the county a absence Stats, (1879), art. 677 at renumbered n subject authority, be to those (1895). Stats, language art. 790 That Rev. Id. Thus our in proceedings. statement unchanged until remained 1987 when “county may be Shobe that a sued for a Legislature the language modified to its demand, but the must first be present April Act of form. See presented to the commissioners’ court for R.S., 70th ch. Leg., sec. allowance, allowance re and its must be Laws Tex. Gen. renumbered fused” is dicta. Id. at 950. The other 23,1999, April to sec. Act of by 76th court cases discussed R.S., 13.03(b), ch. squarely likewise not address the issue do Gen. Thus Laws well over a Ashe, presented Anderson here. See years ago, Legislature hundred deleted (1906) (holding S.W. the only language arguably waiving sover auditor, rejection county that rather eign immunity, suggesting that it intended commissioners than the fulfilled the preserve to counties’ from suit. presentment requirement, but not discuss Liberty Mut. Ins. Co. Garrison Con (Tex. Inc., ing compliance present whether tractors, 1998) ment statute alone established in in construing that statute county); a a over suit Greer changed Legislature the word Hunt not S.W. “company” “person,” Court does (hold adopted) judgm’t Comm’n Legislature may App.1923, “lightly presume act”); Ament, audit ing have auditor’s was not done a useless In re prerequisite plain argues fully performed it and thus contract and that Travis under the presentment tiffs to the commissioners accepting from suit require court satisfied the of that without performance the benefits ment). distinguishes full this payment. The only supreme court case Little-Tex, this case from Court of appeals present- cited that discusses the Chapter relied on 2260 of the Texas Gov- ment response statute in to a eonsent-to- rejecting waiver-by- ernment Code question is Missouri Railroad argument in a conduct breach-of-contract Pacific District, Navigation Co. v. Brownsville university. action state See Lit- (Tex.1970). tle-Tex, Missouri 39 S.W.3d at 595-97. Because 2260 does Pacific, chapter apply not claims we held that a applicable counties, waiver-by- urges navigation quite plain districts “is exception immunity for conduct gives general consent for to be District chapter covered sued in the courts of Texas.” at 813. responds historically, counties navigation statute stated that districts “ enjoyed have the same as the ‘may, by through navigation state and that Pelzel has identified no rea- commissioners, canal sue and all be sued depart son here. principle this courts of this in the such State name of County further that even if argues district, navigation and all this courts of rules that Court could judicial State shall take notice of estab- immunity by did not ” response lishment of all Id. In districts.’ by merely invoking do so here the con- argument to the district’s tract’s clause and re- utes clearly expressed had more consent $5,500.00 $414,164.80 only taining of the suit, we noted that “suits against counties Therefore, price. total contract have been be held to authorized stat- County contends this Court should not utes that simply require the of a waiver-by-conduct adopt exception to im- claim before institution of suit.” But Id. suit munity from for breach-of-contract Missouri involved a different Pacific counties. claims ute than in the one this case that After Pelzel’s for re- granting petition statute, unlike the current version view, decided we Texas Natural Resource here, contained “sue and sued” IT-Davy, Commission v. Conservation Furthermore, language. reviewing in (Tex.2002), which raised the dicta, we have found no cases to it. support when waiver-by-conduct question chapter above, As discussed of cases the court case, not In that IT apply. 2260 does appeals cited did not issue. resolve this fully performed its contract Davy under Thus we remain convinced that section with the Texas Natural Resource Conser- 89.004 does suit immunity not waive from paid vation Commission and the TNRCC for a county. IT-Davy IT-Davy the full contract price. disapprove of Co. v. Jensen Construction claimed, however, profits that it lost when (Tex.App.- Dallas 920 S.W.2d 761 in- materially different site conditions denied), Dallas extent writ Accordingly, costs. it creased its invoked it holds otherwise. provided “equita- a contract clause that for urges no other basis for waiver materially adjustments” ble if “conditions waiver-by- of turn immunity, we ... differ cause an increase or de- [IT-Davy’s] in cost or the time conduct issue. crease any of Because Local Government Code required perform part unambigu- at 851. The TNRCC 89.004 does not work....” IT-Davy ously immunity additional from agreed pay an waive suit $700,000 equita- County’s price over the contract counties and Travis con- adjustments, IT-Davy withholding part but asserted duct in of the contract ble liquidated damages price the TNRCC owed an additional did waive $6,723,655. This concluded its from we reverse the Court judgment did from appeals’ TNRCC not waive and dismiss by its Id. at 851. Pelzel’s claim for want of conduct. case, similar conduct a dissenting Justice ENOCH filed According unit is at governmental issue. opinion. liquidated-damages contract’s clause, County could retain $250 dissenting. Justice ENOCH day

each calendar Pelzel failed to substan contin- tially complete beyond again disagree I with the Court’s building immunity ju- acceptance. support ued of its completion date set here, County undisputed risprudence.1 Significantly The fact is that Travis withheld, has occu- liquidated-damages building built the under clause, $5,500.00 only building, contract refuses to pied the total insists, instead, $414,164.80. price. full price governmen rights under the con- adjusts price according asserting tal unit a contract alleged its not, course, terms, payment. full Of express to the contract’s it does tract withhold if has such from we’ll never know the its adjustment rights if the the contract because the propriety even under interpose IT-Davy, disputed. See Court allows Court, from suit. The sovereign immunity (cid:127)-(cid:127). Thus conclude that Travis Coun- recently many ty did not waive as it done so cases, I locks doors.2 add invoking the contract’s the courthouse another ... The clause. case to List.3 Univ., 2001, See, Safety e.g., Sign pet.); Dept. Pub. v. 951 Dist.] 1. Federal Texas S. no of L, Rivera, 13-01-00446-CV, 401, (Tex.1997) (Enoch, 2001 Tex. v. S.W.2d No. 15, (Corpus Nov. dissenting). App. Christi LEXIS 7681 2001, (not designated publica pet.) no for 849, tion); Regents, IT-Davy, Landry’s v. 74 863 Crab Shack v. Bd. 2. TNRCC of 03-00-00690-CV, J., (Tex.2002) (Enoch, 1240832 dissenting). WL No. 2001 2001, (not (Austin 18, designated pet.) no Oct. 863; publication); Bexar IT-Davy, for Ondemir v. 3. See 74 S.W.3d Gen. Servs. 04-00-00497-CV, Co., Clerk, 2001 WL v. 39 Comm’n Little-Tex Insulation No. (San Sept. pet. (Tex.2001); Transp. Dep't Antonio S.W.3d 591 Inc., denied) (not Aer-Aerotron, designated publication); v. 39 S.W.3d 220 03-00-00603-CV, 408; 2001); Perry, Sign, v. No. 951 S.W.2d at O’Dell Federal (Austin pet.) no Safety Corp., 40 WL June Dep’t Capital v. Int’l Pub. (not designated DOT pet.); publication); State v. (Tex.App.-Austin no Ramirez, Moses, (Austin pet. City Dist. v. Denver Ind. Sch. filed) (not designated publication); Texas pet.); no (Tex.App.-Amarillo Sys. Corp., 03-00- M v. AFEX No. Hosp., Arts A & Univ. Gendreau Medical 00222-CV, (Aus filed); City Tex.App. LEXIS (Tex.App.-Eastland pet. (not pet.) designated for tin Mar. no Houston Northwood Mun. Util. Dist. No. publication). (Tex.App.-Houston [1st 73 S.W.3d 304 Today, keeps the Court the courthouse Worse, permits locked. the Court

doors provisions those enforce chooses, contract it to which Pelzel bound, but leaves the unbound any provisions seeks to enforce. I

Because would hold that the immunity by entering

waived its into the

contract, I reach the present- would not I again, respectfully

ment issue. Once

dissent. INTERNATIONAL,

ROCOR INC. f/k/a Inc., Carriers, Petitioner,

Donco

NATIONAL FIRE UNION INSUR

ANCE COMPANY OF PITTS

BURGH, PA, Respondent.

No. 99-0673.

Supreme Court of Texas.

Argued March 2000. May

Decided

Rehearing July Overruled

Case Details

Case Name: Travis County v. Pelzel & Associates, Inc.

Court Name: Texas Supreme Court

Date Published: Jun 27, 2002

Citation: 77 S.W.3d 246

Docket Number: 01-0036

Court Abbreviation: Tex.