Ysleta Independent School District v. Marcelino Franco
417 S.W.3d 443
Tex.
2013
Check Treatment

YSLETA INDEPENDENT SCHOOL DISTRICT, Petitioner, v. Marcelino FRANCO, Respondent.

No. 13-0072.

Supreme Court of Texas.

Dec. 13, 2013.

443 S.W.3d 443

cle 8307 governed disputes based on settlement agreements in workers’ compensation cases. Act of May 20, 1983, 68th Leg. R.S., ch. 501, § 1, 1983 Tex. Gen. Laws 2934, 2934-35, repealed by Act of Dec. 11, 1989, 71st Leg. 2nd C. S., ch. 1, § 16.01(10), 1989 Tex. Gen. Laws 1, 114. Section 12b, entitled “Compromise settlement agreements and agreed judgments; disputes concerning payment of healthcare benefits,” read as follows:

Whenever in any compromise settlement agreement approved by the board or in any agreed judgment approved by the court, any dispute arises concerning the payment of medical, hospital, nursing, chiropractic or podiatry services or aids or treatment, or for medicines or prosthetic appliances for the injured employee as provided in Section 7, Article 8306, Revised Statutes, as amended, or as provided in such compromise settlement agreements or agreed judgments, all such disputes concerning the payment thereof shall be first presented by any party to the [Division] within six months from the time such dispute has arisen (except where “good cause” is shown for any delay) for the [Division]‘s determination.1

The operative statute, therefore, compels a party to a settlement agreement to first bring disputes to the Division.

The City of Houston stopped paying for Rhule‘s pain pump, medications, and visits to the doctor in 2004. Rhule brought suit against the City in 2008 but did not first present the matter to the Division. Because the statute compelled Rhule to present his dispute to the Division and Rhule failed to do so, Rhule has not exhausted his administrative remedies. This divests the trial court of jurisdiction.2 See .

Without hearing oral argument, we reverse the court of appeals’ judgment and render judgment dismissing Rhule‘s action for lack of subject matter jurisdiction. See TEX. R. APP. P. 59.1.

Bruce A. Koehler, Steven L. Hughes, Mounce, Green, Myers, Safi, Paxson & Galatzan, P.C., El Paso, TX, for Petitioner Ysleta Independent School District.

Charles Mark Berry Jr., El Paso, TX, for Respondent Marcelino Franco.

PER CURIAM.

This Whistleblower Act case raises a familiar issue: whether a report of alleged violations of law is jurisdictionally insufficient if made to someone charged only with internal compliance. TEX. GOV‘T CODE § 554.001 et seq. A few months ago, in . Even more recently, in (per curiam).

This case poses the same issue: whether a report to personnel whose only power is to oversee compliance within the entity itself is enough to confer “law-enforcement authority” status. The courts below answered yes, and erred in doing so (though in fairness, we had not yet decided and ). We reverse, grant the plea to the jurisdiction, and dismiss the case.

*

Marcelino Franco was a principal at the Robert F. Kennedy Pre-K Academy in the Ysleta Independent School District (ISD). He sent a memorandum to his immediate supervisor, the chief academic officer, Gloria Polanco-McNealy, reporting various “asbestos hazards” in the school and raising several “Administrative Issues“—among them:

staff members [are] suffering from recent cancers, liver ailments, respiratory ailments and several advise [him] that ‘they just feel sick‘. Absenteeism is high. One teacher has traveled to the Mayo Institute and remains ‘sick’ but undiagnosed.

Franco feared that he and the teachers, staff, and students were at risk of “contracting a cancer, other related illness(es) or just being chronically ‘sick‘.” Franco asserted that the current working conditions breached his employment contract with the ISD and also the “2472 Code of Ethics and Standard Practices for Texas Educators.” Franco requested a transfer to another school within the district. He included a “confidential communiqué” disclaiming any threatening or provocative motives, and he promised that the ISD could “rely on [his] complete trust, loyalty and professional discretion and ethics.”

Ms. Polanco-McNealy responded that the ISD‘s facilities department was unaware of any asbestos at the school. She also told Franco that she would investigate his accusations of asbestos and mold and the allegedly related illnesses.

In response, Franco directed Ms. Polanco-McNealy to the ISD‘s Asbestos Management Plan, which the district uses to assess asbestos-containing materials located in its buildings. He also attached a work order showing that floor tiles in the building had been replaced. Franco noted that the following comment appears on the work order: “Have school direct this request to Risk Management-Asbestos Abatement attn: Grant Curtis.” Franco highlighted this comment to controvert Ms. Polanco-McNealy‘s claim that the facilities department was unaware of any asbestos in the school. At the end of his memorandum, Franco again requested a transfer to another school. Eventually, the ISD indefinitely suspended Franco, and he filed this whistleblower claim.

It is unclear from the record what communications the parties had after Franco‘s second memorandum. Franco testified, however, that he reported the asbestos hazards to several school officials—including the superintendent and trustees of the district. Franco claimed that the ISD violated the Asbestos Hazard Emergency Response Act, 15 U.S.C. § 2641 et seq., by failing to respond to his asbestos reports. But Franco submitted no evidence showing that the ISD enforces the Asbestos Act beyond overseeing its own internal compliance. And he admitted that he did not report the allegations to anyone other than school officials. He claimed that doing so was unnecessary because the school district is a government entity, and a government entity is a law-enforcement authority under the Whistleblower Act.

The trial court agreed and denied the ISD‘s plea to the jurisdiction. The court of appeals affirmed, holding that “Franco produced sufficient evidence of his good faith belief that the [ISD‘s] superintendent and trustees were authorized to regulate under or enforce the Asbestos Act.” . The court of appeals added that Franco‘s evidence raised a fact issue about whether his belief was objectively reasonable in light of his training and experience. . We disagree.

Our recent cases hold that a report to someone charged only with internal compliance is jurisdictionally insufficient under the Whistleblower Act. ; . As made clear in the school context, reporting to school officials not charged with enforcing laws outside the district falls short of what the Act requires.

In that factually similar case, Farran was executive director of transportation and facilities at Canutillo Independent School District when he reported various alleged violations of law to the school board and other school officials. . Like Franco, Farran submitted no evidence of the school district‘s authority to enforce laws beyond the institution itself. . We concluded that “[a]uthority of the entity to enforce legal requirements or regulate conduct within the entity itself is insufficient to confer law-enforcement authority status.” (quoting ). Thus, Farran could not establish that the school district was an appropriate law-enforcement authority. Consequently, Farran could not show “an objective, good-faith belief that the school district officials to whom Farran complained had authority ‘to enforce, investigate, or prosecute violations of law against third parties outside of the entity itself’ or had ‘authority to promulgate regulations governing the conduct of such third parties‘.” (quoting ).

Similarly, on the record before us, Franco has failed to show an objective, good-faith belief that the ISD qualifies as an “appropriate law-enforcement authority” under the Act. Therefore, the courts below erred in denying the ISD‘s plea to the jurisdiction.

Accordingly, we grant the petition for review and, without hearing oral argument, reverse the court of appeals’ judgment and dismiss the case. See TEX. R. APP. P. 59.1.

PER CURIAM

Notes

1
1. The statute next indicates that “[a] dispute arises when a written refusal of payment has been filed with the [Division].” Rhule has not argued that no “dispute” has arisen because the City of Houston failed to submit a refusal in writing to the Division.
2
2. We need not entertain the City‘s argument under , because the statute directly addresses settlement agreements. We do note, however, that did not address the issue presented in this case, but rather mandated exhaustion of administrative remedies where a claimant sued for delay of medical payments despite entitlement only to temporary income benefits. See .
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