Court of Appeals of Texas, Fourteenth District, Houston
CITY OF HOUSTON AND DANIEL W. KRUEGER, IN HIS OFFICIAL CAPACITY AS DIRECTOR OF PUBLIC WORKS AND ENGINEERING DEPARTMENT, Appellants
LITTLE NELL APARTMENTS, L.P., ET AL., Appellees
On Appeal from the 129th District Court, Harris County, Texas. Trial Court Cause No. 2012-09885.
For APPELLANT: John B. Wallace, Judith Lee Ramsey, HOUSTON, TX.
For APPELLEE: Brandon Barchus, HOUSTON, TX.
Panel consists of Christopher, Donovan, and Brown
Marc W. Brown, Justice.
Appellants, the City of Houston (the " City" ) and Daniel W. Krueger, in his official capacity as Director of Public Works and Engineering Department, present this accelerated appeal from the trial court's order partially denying their plea to the jurisdiction based on governmental immunity in a declaratory judgment action brought by appellees, Little Nell Apartments, LP (" Little Nell" ), HFI Regency Park Apartments, LP (" Regency" ), and Windshire Apartments, LP (" Windshire" ) (collectively, the " Apartments" ). After an evidentiary hearing, the trial court sustained in part and denied in part the City and Krueger's plea to the jurisdiction, denying the plea only as to the Apartments' request for a declaratory judgment that Krueger in his official capacity acted in an ultra vires manner by subjecting their properties to drainage fees pursuant to chapter 47, article XIV, of the City's Code of Ordinances. After concluding that we have appellate jurisdiction, we affirm.
I. Factual and Procedural Background
In April 2011, the City enacted Ordinance No. 2011-254, hereinafter referred to as the " drainage fee ordinance." See Houston, Tex., Code of Ordinances, ch. 47, art. XIV (" Code of Ordinances" ). The drainage fee ordinance created a municipal drainage utility, a public utility, " [i]n the interest of public health and safety and a more efficient and economic operation of drainage facilities of the city." Code of Ordinances, § 47-803. Under the drainage fee ordinance, the City shall " establish a schedule of drainage charges against all real property in the city subject to such charges" ; provide drainage " for all real property in the city on payment of drainage charges unless the property is exempt from such payment" ; and " offer drainage
service on nondiscriminatory, reasonable and equitable terms." Id. § 47-801. The drainage charges are imposed " [t]o recover the city's cost of service to provide drainage to benefitted properties" and are to be used exclusively for various expenses " associated with the cost of service to provide drainage services within the service area." Id. § § 47-821, 47-822(a). Drainage charges are calculated based on the specified rate (either residential or non-residential, and if residential, whether curb-and-gutter or open-ditch) per " square foot of impervious surface of a benefitted property." Id. § 47-822(b), (c). The drainage fee ordinance provides for various categories of exemptions from the imposition of a drainage charge. Id. § 47-822(f). The director of the City's department of public works and engineering " shall be responsible for the administration of this article [XIV. Municipal Drainage Utility System]." Id. § 47-805. The drainage fee ordinance provides that the director " shall establish and implement a system of verification and correction of drainage charges for each property subject to the drainage charges." Id. § 47-824(a).
In May 2011, the Apartments received notice of proposed drainage charges that Krueger had determined for each of the Apartments based on each property's impervious square footage. The Apartments submitted requests for verification and correction of their initial drainage charges, specifically indicating that each property's drainage system was not part of the City's drainage system and therefore should be exempt from the drainage charges. See id . § 47-824(b). After these requests were denied, the Apartments requested an appeal. See id . § 47-824(e). These appeals resulted in a downward adjustment of the amount of Regency's impervious square footage, but did not change Little Nell's and Windshire's noticed amounts.
In February 2012, the Apartments sued both the City and Krueger in his official capacity. The Apartments sought declarations with respect to whether they were " benefitted properties" under the ordinance, or alternatively, whether they were exempt from drainage charges under section 47-822(f)(2) of the ordinance, and sought recovery for drainage charges that they already paid. The City and Krueger filed a plea to the jurisdiction based on governmental immunity. The Apartments amended their petition to drop their claims for a refund of fees, and to specifically seek a declaration that the drainage fee ordinance is invalid and assert ultra vires claims against Krueger based upon his failure to follow the ordinance. The City and Krueger filed an amended plea to the jurisdiction and a supplement to their amended plea. The Apartments responded in opposition.
The trial court held an evidentiary hearing. Carol Haddock, a senior assistant director in the City's public works and engineering department, and Carl Smitha, the city engineer, testified on behalf of the City and Krueger. David Brown, former chief drainage engineer for the City and former assistant director over design and construction for the Harris County Flood Control District (" HCFCD" ), currently in private engineering practice, is the engineer of record for the development of the three properties at issue and testified on behalf of the Apartments.
At the conclusion of the hearing on December 12, 2012, the trial court provided its oral ruling denying in part and sustaining
in part the City and Krueger's plea. The City filed its notice of appeal that same day. On January 11, 2013, the trial court signed its written order denying the amended plea and supplement as to the Apartments' request for a declaratory judgment that Krueger, in his official capacity, acted in an ultra vires manner by subjecting their properties to drainage fees pursuant to the drainage fee ordinance, and otherwise sustaining the plea. The trial court indicated that its denial was " due and restricted to the particular jurisdictional facts associated with the [Apartments'] specific locations and drainage at issue in this suit." The City filed an amended notice to appeal that same day " to provide the written order." The City and Krueger filed a second amended notice of appeal on March 27, 2013.
We first review the threshold issue of our jurisdiction. The Apartments argue that this court lacks jurisdiction to hear Krueger's appeal because he was not included as an appealing party on the City's notice of appeal filed on December 12, 2012, the day the trial court made its oral ruling, deemed filed as of January 11, 2013; he was not included as an appealing party on the City's amended notice of appeal filed on January 11, 2013, " to provide the [court's] written order" ; and he was first included as an appealing party on a second amended notice of appeal filed by both the City and Krueger on March 27, 2013. The Apartments contend that Krueger's delay proves fatal to his appeal. We disagree.
Rule of Appellate Procedure 25.1 states that " [a]n appeal is perfected when a written notice of appeal is filed with the trial court clerk." Tex R. App. P. 25.1(a). The rule contemplates that there might be a defect or that information might be omitted, and specifically authorizes a party to file an amendment " to correct a defect or omission in an earlier filed notice." Id. 25.1(g). When a notice of appeal fails to " state that the party desires to appeal" and to " state the name of each party filing the notice," it is defective. Kim v. Scarborough, No. 14-04-00262-CV, 2004 WL 1574598, at *1 (Tex. App.--Houston [14th Dist.] July 15, 2004, no pet.) (mem. op.) (per curiam) (citing Tex. R. App. P. 25.1(d)(3),(5)).
The Texas Supreme Court " has consistently held that a timely filed document, even if defective, invokes the court of appeals' jurisdiction." Sweed v. Nye, 323 S.W.3d 873, 875 (Tex. 2010) (per curiam) (gathering cases). The Texas Supreme Court also has explained that its " consistent policy has been to apply rules of procedure liberally to reach the merits of the appeal whenever possible." Warwick Towers Council of Co-Owners ex rel. St. Paul Fire & Marine Ins. Co. v. Park Warwick, L.P., 244 S.W.3d 838, 839 (Tex. 2008) (per curiam) (gathering cases).
Moreover, " a court of appeals has jurisdiction over an appeal when the appellant files an instrument that is 'a bona fide attempt to invoke appellate court jurisdiction.'" City of San Antonio v. Rodriguez, 828 S.W.2d 417, 418 (Tex. 1992) (per curiam) (citing Grand Prairie Indep. Sch. Dist. v. S. Parts Imports, Inc., 813 S.W.2d 499, 500 (Tex. 1991) (per curiam)). Thus, appellate courts should allow an opportunity to amend a defective instrument before dismissal. Kim, 2004 WL 1574598, at *1 (describing issuance of court order
allowing amendment of notice of appeal). Examples where the Texas Supreme Court has concluded that a bona fide attempt was made to invoke the appellate court's jurisdiction include: where the notice of appeal was filed by the insurer instead of the insured, where a party filed a notice of appeal in the alternative as part of a motion for new trial, where a party filed one " instrument" in an attempt to appeal two probate orders, where a party filed a notice of appeal with the wrong cause number, and where a party filed a notice of appeal five and a half months after his claim was dismissed and then amended that notice after the six-month mark to include information required for a restricted appeal.
The City and Krueger assert that their attorneys meant to appeal the partial denial of the plea to the jurisdiction on behalf of both the City and Krueger. They acknowledge their attorneys made a mistake by only filing on the City's behalf, but they amended the notice of appeal before filing their joint appellate brief. See Tex. R. App. P. 25.1(g) (" An amended notice of appeal correcting a defect or omission in an earlier filed notice may be filed in the appellate court at any time before the appellant's brief is filed." ). The Apartments acknowledge that the City's notice of appeal from the denial of its and Krueger's plea to the jurisdiction was timely. See Tex. Civ. Prac. & Rem. Code § 51.014(a)(8) (West 2011); Tex. R. App. P. 26.1(b) & 28.1(b). The Apartments acknowledge that the City is a " necessary party to the case because the Court will be required to construe the City's ordinances in determining whether Krueger had the authority to assess the Apartments with the drainage fees." See Tex. Lottery Comm'n v. First State Bank of DeQueen, 325 S.W.3d 628, 634 (Tex. 2010). The Apartments also acknowledge that the trial court's order, which denied the plea to the jurisdiction as to the Apartments' request for a declaratory judgment that Krueger " acted in an ultra vires manner by subjecting the properties . . .with drainage fees," was attached to the City's first amended notice of appeal.
Nevertheless, the Apartments contend that there was no bona fide attempt by Krueger to appeal. However, all the cases they cited are distinguishable either because there was no timely notice of appeal filed whatsoever, the notice of appeal was not timely as to the particular order sought to be appealed, the party who did file a timely notice of appeal lacked standing, or the court failed to address whether there was a bona fide attempt to invoke appellate jurisdiction. Moreover, the
Apartments have not argued that they were misled or disadvantaged in any way by the defective notice here. See Rodriguez, 828 S.W.2d at 418.
In light of the consistent holdings of the Texas Supreme Court, its policy to apply the rules of procedure liberally in favor of appellate review, and the circumstances of this case, we therefore conclude that we have jurisdiction to hear Krueger's appeal.
The parties acknowledge that the sole issue on appeal is whether the trial court erred in denying the City and Krueger's plea to the jurisdiction as to the ultra vires claims alleged against Krueger by the Apartments. The City and Krueger argue both the face of the Apartments' pleadings and the jurisdictional evidence confirm that the alleged ultra vires claims are barred by governmental immunity. We conclude that the trial court did not err.
A. Standard of review
If a governmental unit has immunity from a pending claim, a trial court lacks subject matter jurisdiction as to that claim. Rusk State Hosp. v. Black, 392 S.W.3d 88, 95 (Tex. 2012). A challenge to a trial court's subject matter jurisdiction may be asserted by a plea to the jurisdiction. Tex. Dep't of Parks & Wildlife v. Miranda, 133 S.W.3d 217, 225-26 (Tex. 2004). We review a trial court's ruling on a plea to the jurisdiction de novo. Id. at 228. In a plea to the jurisdiction, a party may challenge the pleadings, the existence of jurisdictional facts, or both. Id. at 226-27.
When a plea to the jurisdiction challenges the pleadings, we determine if the plaintiff has alleged facts affirmatively demonstrating the court's jurisdiction. Id. at 226 (citing Tex. Ass'n of Bus. v. Tex. Air Control Bd., 852 S.W.2d 440, 446 (Tex. 1993)). " We construe the pleadings liberally in favor of the plaintiffs and look to the pleaders' intent." Id. If the pleadings do not contain sufficient facts to affirmatively demonstrate jurisdiction but do not reveal incurable defects, the issue is one of pleading sufficiency and the plaintiffs should be afforded the opportunity to amend. Id. at 226-27. If the pleadings affirmatively negate the existence of jurisdiction, then a plea to the jurisdiction may be granted without allowing the plaintiffs an opportunity to amend. Id. at 227.
Where the governmental unit challenges the existence of jurisdictional facts, and the parties submit evidence relevant to the jurisdictional challenge, we consider that evidence when necessary to resolve the jurisdictional issues raised. Id. at 227; Olivares v. Brown & Gay Eng'g, Inc., 401 S.W.3d 363, 369 (Tex. App.--Houston [14th Dist.] 2013, pet. filed). The standard of review for a jurisdictional plea based on evidence " generally mirrors that of a summary judgment under Texas Rule of Civil Procedure 166a(c)." Miranda, 133 S.W.3d at 228. Under this standard, when reviewing a plea in which the pleading requirement has been met, we credit as true all evidence favoring the nonmovant and draw all reasonable inferences and resolve any doubts in the nonmovant's favor. Id. The movant must assert the absence of subject-matter jurisdiction and present conclusive proof that the trial court lacks subject-matter jurisdiction. Id. Proof is conclusive only if reasonable people could not differ in their conclusions. City of Keller v. Wilson, 168 S.W.3d 802, 816 (Tex. 2005). If the movant discharges this burden, the nonmovant must present evidence sufficient to raise a material issue of fact regarding jurisdiction, or the plea will be sustained. Miranda, 133 S.W.3d at 228.
Thus, once and if the Apartments have met their pleading requirement, as the movants, the City and Krueger have the
burden to establish their entitlement to governmental immunity. See id . If the evidence raises a fact issue as to jurisdiction, their plea must be denied because the issue must be resolved by the trier of fact. See id. at 227-28. If the relevant evidence is undisputed or fails to present a jurisdictional fact issue, however, the court should rule on the plea as a matter of law. Id.
B. Ultra vires claims
The Apartments have attempted to plead ultra vires claims against Krueger in his official capacity, alleging that Krueger is acting outside of his authority under the drainage fee ordinance by imposing drainage charges on the Apartments' properties. They contend that Krueger exceeded his authority because their developed properties are not " benefitted properties," and because they are exempt from drainage charges since they are " served exclusively by a properly constructed and maintained wholly sufficient and privately owned drainage system." The City and Krueger argue that the Apartments merely complain of Krueger's exercise of authority and discretion, which he did not exceed, and therefore their claims are barred by immunity.
A suit asserting that a government officer acted without legal authority or seeking to compel him to comply with statutory or constitutional provisions is an ultra vires suit and is not subject to pleas of governmental immunity. See City of El Paso v. Heinrich, 284 S.W.3d 366, 371-72 (Tex. 2009). Such a suit, in effect, does not seek to alter government policy; it seeks to reassert the control of and enforce existing policy of the governmental entity. Id. at 372. Because these suits are not considered to be suits against the governmental entity, they must be brought against the allegedly responsible government actors in their official capacities, as the Apartments have done here against Krueger. See id. at 373. To fall within the ultra vires exception to governmental immunity, a plaintiff may not complain about a government officer's exercise of discretion, but rather must allege, and ultimately prove, that the officer acted without legal authority or failed to perform a purely ministerial act. Id. at 372. The exception permits only prospective declaratory or injunctive relief restraining ultra vires conduct, as opposed to retroactive relief. Id. at 374-77 (explaining that although governmental immunity does not bar such ultra vires claims, because suit is against the governmental unit for all practical purposes, its remedies must be limited).
The parties agree that this court will need to construe the ordinance in our review of the trial court's ruling in order to determine whether the facts as pleaded demonstrate the ultra vires nature of Krueger's alleged actions. If we conclude that the pleadings do not affirmatively negate jurisdiction, then we will determine whether the evidence raises a fact issue as to jurisdiction.
C. The director's authority and discretion under the drainage fee ordinance
The City and Krueger insist that the drainage fee ordinance necessarily grants Krueger the authority and discretion to assess drainage charges on the Apartments' properties after making the threshold determination as to whether the property is within the " service area" as defined in the ordinance, and after making the determination as to whether the property falls within any of specified exemptions from such charges. The Apartments acknowledge that the drainage fee ordinance confers authority and some discretion upon Krueger to determine the amount of the
fee and the methodology employed in the calculation of the impervious service on a property subject to the fee. However, they argue that the issue presented in their ultra vires claims is whether a drainage charge can be imposed on their properties at all. The Apartments contend nothing in the ordinance gives Krueger the authority or discretion to charge fees that are not otherwise authorized by the ordinance.
The same rules that govern statutory construction apply to the construction of municipal ordinances. Seawall E. Townhomes Ass'n, Inc. v. City of Galveston, 879 S.W.2d 363, 364 (Tex. App.--Houston [14th Dist.] 1994, no writ) (citing Mills v. Brown, 159 Tex. 110, 316 S.W.2d 720, 723 (Tex. 1958)). Our primary objective is to give effect to the enacting body's intent. Id.; see TGS--NOPEC Geophysical Co. v. Combs, 340 S.W.3d 432, 439 (Tex. 2011). The most reliable expression of such intent is the literal text of the provision. See Alex Sheshunoff Mgmt. Servs., L.P. v. Johnson, 209 S.W.3d 644, 651 (Tex. 2006). We presume that the language of an ordinance was selected with care and that every word and phrase was used for a purpose. See DeQueen, 325 S.W.3d at 635. Where possible, we avoid treating any language as surplusage. Spradlin v. Jim Walter Homes, Inc., 34 S.W.3d 578, 580 (Tex. 2000). We construe an ordinance " according to what it says, not according to ...