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City of El Paso, Texas v. Viel

Court of Appeals of Texas, Eighth District, El Paso

June 30, 2017

CITY OF EL PASO, TEXAS, Appellant,
v.
HOLGER P. VIEL, Appellee.

         Appeal from the County Court at Law No. 6 of El Paso County, Texas (TC# 2014-DCV3195)

          Before McClure, C.J., Rodriguez, and Palafox, JJ.

          OPINION

          GINA M. PALAFOX, Justice

         This is an accelerated interlocutory appeal filed by Appellant City of El Paso (the City), from the trial court's denial of the City's plea to the jurisdiction. Appellee Holger Viel filed suit against the City due to injuries he sustained when an overhead rolling service door collapsed on him while he was working for an air cargo business that leased a portion of a cargo warehouse owned by the City. The City argues that it engaged in a governmental function in leasing the cargo warehouse and that it retained immunity from suit and liability for all claims Viel filed against it. For the reasons explained below, we reverse the trial court's order in part and dismiss Viel's claims for negligent use of tangible personal property, for general negligence, for negligent undertaking, and for punitive damages, all for lack of subject matter jurisdiction. We affirm the trial court's refusal to dismiss the premises defect claim and remand that claim for further proceedings in accordance with this opinion.

         I. FACTUAL BACKGROUND

         The City and Servisair U.S. A, Inc. (Servisair) signed a lease agreement on January 22, 2013, whereby the City leased a portion of an air cargo warehouse, known as the Cargo 2 building, on property owned by the City at the El Paso International Airport (the Airport). Servisair operated a cargo business at the cargo warehouse pursuant to contracts with several airlines. Viel worked for Servisair as a "senior cargo agent." Among other duties, Viel inspected cargo shipments in transit to ensure shipments complied with federal aviation standards and were safe for air transportation.

         On June 5, 2013, Viel was working at the cargo warehouse when a semi-trailer truck arrived with an outbound international air freight shipment. The truck backed up to the rolling overhead door of one of the building's loading docks. The truck's cargo door had a heavy-duty seal or lock that required the use of bolt cutters to open. After the truck parked in a loading bay, Viel opened the electronically-operated, roll-up overhead door of the building and, while standing underneath the overhead door, he attempted to cut the lock on the back of the truck. While he was using bolt cutters on the lock, the overhead door attached to the building suddenly came crashing down on Viel, hitting his lower back, knocking him forward, and causing him to strike his head against the parked truck. Viel suffered extensive injuries.

         A. Viel's Lawsuit

         Nearly five months after his injury, in October of 2013, Viel sent a formal letter informing the City of his claim for injuries he sustained from the incident involving the overhead door on the City's Airport property. He later filed suit against the City and several other defendants. As against the City, Viel asserted claims of general negligence and premises liability. As against all defendants including the City, Viel sought compensatory and punitive damages.

         B. The City's Plea and Motion to Dismiss

         The City filed a motion to dismiss all claims filed against it for lack of subject matter jurisdiction based on governmental immunity alleging that Viel failed to provide timely notice of his claim as required by the Texas Tort Claims Act (TTCA). By agreement, the parties delayed setting a hearing and engaged in discovery on the jurisdictional issues raised in the motion to dismiss. After a year, the City filed a combined supplemental motion to dismiss for lack of jurisdiction and motion for summary judgment with evidence attached in support of its arguments. The City argued the evidence established, as a matter of law, that the trial court lacked subject matter jurisdiction over Viel's claims because governmental immunity had not been waived and it was entitled to dismissal of all claims. Alternatively, the City further argued it was not subject to liability because no genuine issue of material fact existed as to essential elements of Viel's claims. Specifically, the City argued that Viel provided no evidence the City was in control of the overhead door at the cargo warehouse or that it had actual knowledge of the dangerous condition of the overhead door prior to the incident. Thus, the City requested dismissal with prejudice of all Viel's claims filed against it.

         Viel filed a supplemental petition and a response to the City's motions. Viel asserted that the City engaged in a proprietary function rather than a governmental function in leasing the cargo warehouse where he sustained his injury and, thus, the City was not immune from suit and could be held liable to the same extent as a private entity. Moreover, Viel argued the jurisdictional evidence raised factual issues regarding his claims brought against the City.

         In reply, the City filed a response with additional evidence attached. Following a hearing, the trial court denied the City's motions. Thereafter, the City timely appealed.[1]

         II. DISCUSSION

         On appeal, the City brings seven issues in arguing that the trial court erred in denying its combined motions to dismiss based on governmental immunity from suit and liability. Specifically, the City contends that: because it engaged in a governmental function, all of Viel's claims must comply with the requirements of the TTCA; that Viel did not timely comply with mandatory pre-suit notice requirements of the TTCA; that Viel failed to establish either an actionable premises defect claim or a tangible personal property claim under the TTCA; that all claims filed outside the TTCA were barred by immunity; and that exemplary damages were not permitted under the TTCA.

         A. Plea to the Jurisdiction

         As a political subdivision of the State of Texas, the City is generally protected by governmental immunity from lawsuits for money damages unless immunity has been clearly and unambiguously waived by statute. City of El Paso v. Collins, 483 S.W.3d 742, 749 (Tex.App.--El Paso 2016, no pet.); see also Tex.Gov't Code Ann. § 311.034 (West 2013) (a statute shall not be construed as a waiver of sovereign immunity unless the waiver is effected by clear and unambiguous language). Governmental immunity from suit defeats a trial court's subject matter jurisdiction and thus it is properly asserted in a plea to the jurisdiction. Gay v. City of Wichita Falls, 457 S.W.3d 499, 504 (Tex.App.--El Paso 2014, no pet.) (citing Texas Dept. of Parks and Wildlife v. Miranda, 133 S.W.3d 217, 225-26 (Tex. 2004)); see also City of El Paso v. Waterblasting Techs., Inc., 491 S.W.3d 890, 894 (Tex.App.--El Paso 2016, no pet.) (a plea to the jurisdiction based on governmental immunity challenges a trial court's subject matter jurisdiction).

         While the City did not label its motions as a "plea to the jurisdiction, " the City's combined motions function as a plea and we will treat them as such for purposes of this appeal.[2] The function of a plea to the jurisdiction is "to defeat a cause of action without regard to whether the claims asserted have merit." Waterblasting Techs, 491 S.W.3d at 894 (quoting Bland Indep. Sch. Dist. v. Blue, 34 S.W.3d 547, 554 (Tex. 2000)). In a plea to the jurisdiction, a defendant may challenge the sufficiency of the plaintiff's pleadings to establish jurisdiction or, alternatively, the existence of "jurisdictional facts" in support of subject matter jurisdiction. Id. at 895 (citing Miranda, 133 S.W.3d at 226); see also Collins, 483 S.W.3d at 748-49. The question of whether a plaintiff has alleged sufficient facts to affirmatively demonstrate a trial court's subject matter jurisdiction, as well as whether the jurisdictional facts establish a trial court's jurisdiction (or lack thereof), are both questions of law reviewed de novo. Texas Dep't of Aging & Disability Services v. Loya, 491 S.W.3d 920, 923 (Tex.App.--El Paso 2016, no pet.) (citing Miranda, 133 S.W.3d at 226); see also Tex. Natural Res. Conservation Comm'n v. IT-Davy, 74 S.W.3d 849, 855 (Tex. 2002).

         A plaintiff bears the burden of alleging sufficient facts and to come forward with jurisdictional evidence to demonstrate that the trial court has subject matter jurisdiction over its claims. Waterblasting Techs, 491 S.W.3d at 895; see also Tex. Ass'n Bus. v. Tex. Air Control Bd., 852 S.W.2d 440, 446 (Tex. 1993). In determining whether a plaintiff has satisfied this burden, "we review the allegations in the pleadings-accepting them as true and construing them in the plaintiffs favor-and any evidence relevant to the inquiry." Loya, 491 S.W.3d at 923 (citing Miranda, 133 S.W.3d at 226-27; Esparza, 471 S.W.3d at 908; Mayfield v. Tarrant Regional Water Dist, 467 S.W.3d 706, 711 (Tex.App.--El Paso 2015, no pet.)). As a non-movant, the plaintiffs burden is to produce evidence raising a genuine issue of material fact on the elements specified in defendant's plea. Tex.R.Civ.P. 166a(i); Mack Trucks, Inc. v. Tamez, 206 S.W.3d 572, 582 (Tex. 2006). If the evidence raises a fact question on jurisdiction, the plea must be denied. Loya, 491 S.W.3d at 923-24 (citing Miranda, 133 S.W.3d at 227-28; Esparza, 471 S.W.3d at 908; Mayfield, 467 S.W.3d at 711). However, if the defendant's evidence is undisputed and demonstrates a lack of jurisdiction, and if the plaintiffs responsive evidence does not raise a fact question on the jurisdictional issue, as a matter of law, the trial court must grant the plea to the jurisdiction. Id. at 924 (citing Mayfield, 467 S.W.3d at 711-12).

         B. Proprietary or Governmental Function

         This appeal necessarily begins with the threshold question of whether the City engaged in a governmental or proprietary function in leasing the cargo warehouse where Viel allegedly sustained his injuries. Whether the City engaged in a proprietary or governmental function is a question of law reviewed de novo. See Wheelabrator Air Pollution Control, Inc. v. City of San Antonio, 489 S.W.3d 448, 451 (Tex. 2016).

         The TTCA provides that a city is not protected by immunity when performing proprietary functions as compared to governmental functions. Tex.Civ.Prac. & Rem. Code Ann. § 101.0215 (West Supp. 2016); Williams v. City of Midland, 932 S.W.2d 679, 682 (Tex.App.--El Paso 1996, no writ); Turvey v. City of Houston, 602 S.W.2d 517, 518 (Tex. 1980). The Texas Constitution authorizes the Legislature to "define for all purposes those functions of a municipality that are to be considered governmental and those that are proprietary, including reclassifying a function's classification assigned under prior statute or common law." Tooke v. City of Mexia, 197 S.W.3d 325, 343 (Tex. 2006) (citing Tex.Const. art. XI, § 13); see also Gay, 457 S.W.3d at 504 (recognizing the 1987 Texas constitutional amendment gave the Legislature authority to define governmental and proprietary functions, including the authority to reclassify definitions already existing at common law).

         Based on this grant of authority, governmental functions include airport activities, broadly described as "planning, acquisition, establishment, construction, improvement, equipping, maintenance, operation, regulation, protection, and policing of an airport or air navigation facility under this chapter, including the acquisition or elimination of an airport hazard[.]" Tex.Transp.Code Ann. § 22.002(a)(2) (West 2011); see also Irving Indep. Sch. Dist. v. Delta Airlines, Inc., 534 S.W.2d 365, 368 (Tex.Civ.App.--Texarkana 1976, writ ref'd n.r.e.) (under similarly-worded Texas Municipal Airports Act, the predecessor statute to the Transportation Code, cities are "authorized to construct, operate and maintain airports and have been delegated power to be exercised by them in the execution of such endeavors"); City of Corsicana v. Wren, 317 S.W.2d 516, 521 (1958) (noting that the Texas Municipal Airports Act categorized airport operations as a governmental function). Airport activities are all considered "public and governmental functions, exercised for a public purpose, and [are] matters of public necessity[.]" Tex.Transp.Code Ann. § 22.002(a) (emphasis added). Like the Transportation Code, the TTCA also lists "airports" as a governmental function that is "enjoined on a municipality by law and . . . given it by the state as part of the state's sovereignty, to be exercised by the municipality in the interest of the general public[.]" Tex.Civ.Prac. & Rem.Code Ann. § 101.0215(a)(10).

         Regarding specific airport functions, the Transportation Code provides that a municipality's powers to operate an airport include those necessary to facilitate passenger travel as well as cargo operations. Tex.Transp.Code Ann. § 22.011(b)(1)(B), (D) (West 2011) (the powers granted to a municipality include the power to construct, maintain and operate buildings at the airport for "cargo, freight, and mail handling, storage, and processing"). The construction and maintenance of a cargo building or facility is also included among the airport operating powers granted to local governments. See Tex.Transp.Code Ann. § 22.011(b)(1)(B). In "operating an airport, " a municipality may enter into a contract, lease, or other arrangement, with a third party for a term not exceeding forty years, granting the third party the "privilege of using . . . a portion or facility of the airport . . . or space in the airport . . . for commercial purposes[.]" Tex.Transp.Code Ann. § 22.021(a)(1) (West 2011); see also Hale v. City of Bonham, 477 S.W.3d 452, 457-58 (Tex.App.--Texarkana 2015, pet. denied) (city performing governmental function when it entered a lease for a municipal airport hangar). Municipalities are authorized to enter a lease with a third party for "conferring the privilege of supplying goods, services, or facilities at the airport . . . ." Tex.Transp.Code Ann. § 22.021(a)(2) (West 2011). In entering the lease, the municipality "may establish the terms and fix the charges, rentals, or fees for the privileges . . . [t]he charges, rentals, and fees must be reasonable and uniform for the same class of privilege or service and shall be established with due regard to the property and improvements used and the expenses of operation to the local government." Tex.Transp.Code Ann. § 22.021(b).

         In this case, the parties are not disputing the appurtenant location of the cargo warehouse to the Airport. Two employees, Airport Director Monica Lombrana and operations supervisor Priscilla Elenez, testified that the cargo warehouse is located within the 17-mile secured and fenced area dedicated to Airport operations and considered part of the "airfield." Lombrana explained that City employees regularly patrolled the cargo warehouse area to ensure that the integrity of airport security is maintained.

         At issue, Viel asserts the City's leasing of the cargo warehouse is not directly associated with Airport operations, and thus, the City did not engage in a governmental function in leasing the premises. Viel asserts that the City used its cargo warehouse to generate revenue from non-public activities thereby engaging in a function that is construed as proprietary, not governmental. Viel relies on testimony from Director Lombrana wherein she acknowledged that the City characterized the revenue received from leasing the cargo warehouse as "nonaviation" in its financial reporting.

         Contrary to Viel's arguments, however, evidence supports the City's position that the leasing of the cargo warehouse pertained to Airport operations. The lease agreement narrowly restricts Servisair's use of the leased premises to "Aviation Related Operations only." The lease allows Servisair to access roadways of the Airport property and provides that Servisair employees' may enter onto the premises labeled the "restricted area of the Airport, " if employees first receive security clearance from the City. The City retains the right to come onto the leased premises to address any obstructions or interference to air navigation and to eliminate any use of the premises that would constitute an "airport hazard." Director Lombrana explained that the City retains its right to enter all leased premises to fulfill its responsibility for the "integrity" and "security" of the airfield.

         As for Viel's argument that the leasing of the cargo warehouse did not serve a "public" purpose, evidence established that the cargo warehouse is, in fact, open to the public for dropping off and picking up of cargo in transit. Airport security coordinator Leticia Missirian testified that there is a "public side" and an "air side" to the building. Moreover, Director Lombrana explained that the City relies on the rental revenue generated from leasing to operate the Airport. Even though it is located a half-mile from the passenger terminal, the cargo building serves the public far more than Viel acknowledges.

         Thus, we determine the City was engaged in a governmental function in leasing the cargo warehouse, as statutorily permitted under Section 22.021(a)(1) of the Transportation Code, entitling the City to governmental immunity to the extent its immunity is not otherwise waived under the TTCA. Tex.Transp.Code Ann. § 22.021(a)(1); Miranda, 133 S.W.3d at 224-25.

         Accordingly, Issue One is sustained.

         C. TTCA Pre-Suit Notice

         In Issue Two, the City contends that governmental immunity is not waived as Viel failed to provide the City with timely pre-suit notice of his claim pursuant to the requirements of the TTCA and the City's applicable notice ordinance.

         It is well recognized that failure to give proper notice to a governmental entity deprives the trial court of jurisdiction and the court must dismiss the case. Tex.Gov't Code Ann. § 311.034 (West 2013) (pre-suit notice is a jurisdictional requirement in all suits against a governmental entity); City of Dallas v. Carbajal, 324 S.W.3d 537, 537-38 (Tex. 2010); City of El Paso v. Hernandez, 342 S.W.3d 154, 158-60 (Tex.App.--El Paso 2011, no pet.). The TTCA entitles governmental entities to receive formal notice of a claim against it within six months of the incident which established the basis of the claim. Tex.Civ.Prac. & Rem. Code Ann. § 101.101(a) (West 2011). When a governmental entity is a municipality, however, the TTCA ratifies municipal provisions modifying the six-month deadline. Id. § 101.101(b). In this case, the City is a home rule city[3] existing under Article XI, Section 5 of the Texas Constitution. Tex.Const. art. XI, § 5; Tex.Local Gov't Code Ann. § 5.004 (West 2008). The El Paso Municipal Code requires written, pre-suit notice within ninety days of the incident, or within six months for good cause shown. El Paso, Tex. Municipal Code, ch. 3, § 3.28.010 (1993). Viel does not dispute that his letter to the City, sent nearly five months after the incident at issue, fell outside the ninety-day window.[4] He contends, instead, that formal notice to the City was excused as the City had actual notice of the incident within a very short period after the incident. In response to the City's plea, Viel contends a question of fact exists on whether the City acquired actual notice pursuant to Section 101.101(c) of the TTCA.[5]

         The TTCA provides that formal notice is excused "if the governmental unit has actual notice that . . . the claimant has received some injury[.]" Tex.Civ.Prac. & Rem.Code Ann. § 101.101(c). Whether a governmental unit had actual notice of an injury is ordinarily a question of fact, but in many cases, it may be determined as a matter of law when the evidence is insufficient to raise a fact issue. Univ. Tex. Sw. Med. Ctr. at Dallas v. Estate of Arancibia, 324 S.W.3d 544, 549 (Tex. 2010); Hernandez, 342 S.W.3d at 159. When the evidence is disputed, whether the governmental entity had actual knowledge of its fault is a fact question. Rojas v. County of El Paso, 408 S.W.3d 535, 540 (Tex.App.--El Paso 2013, no pet.) (citing Texas Department of Criminal Justice v. Simons, 140 S.W.3d 338, 348 (Tex. 2004)).

         To excuse lack of formal notice pursuant to Section 101.101(c), a claimant must establish that a governmental unit had actual notice of: "(1) a death, injury, or property damage; (2) the governmental unit's alleged fault producing or contributing to the death, injury, or property damage; and (3) the identity of the parties involved." Cathey v. Booth, 900 S.W.2d 339, 341 (Tex. 1995). In Cathey, the Court explained that the purpose of the notice requirement is "to ensure prompt reporting of claims in order to enable governmental units to gather information necessary to guard against unfounded claims, settle claims, and prepare for trial." Id.

         Nearly a decade after Cathey, the Texas Supreme Court clarified the second element of actual notice, stating:

What we intended in Cathey by the second requirement for actual notice was that a governmental unit have knowledge that amounts to the same notice to which it is entitled by Section 101.101(a). That includes subjective awareness of its fault, as ultimately alleged by the claimant, in producing or contributing to the claimed injury. [Emphasis added].

Simons, 140 S.W.3d at 347.

         "[A]ctual notice is a fact question when the evidence is disputed" and may be proven by circumstantial evidence. Id. at 348. Moreover, actual notice may be imputed to a governmental unit through an agent or representative who has the duty to investigate and report to a person of authority. Univ. of Texas Health Sci. Ctr. at San Antonio v. Stevens, 330 S.W.3d 335, 339 (Tex.App.--San Antonio 2010, no pet.) (citing Texas Tech Univ. Health Sci. Ctr. v. Lucero, 234 S.W.3d 158, 163, 168 (Tex.App.--El Paso 2007, pet. denied)).

         To support his argument, Viel relies on deposition testimony and other documentation to show that shortly after the injury occurred, within the required ninety-day notice period, the City subjectively knew of both his injury and its fault in producing or contributing to it, as ultimately alleged by his pleadings. There is no dispute that several city employees were immediately aware and participated in providing aid to Viel on site at the cargo warehouse. Priscilla Elenez, an airport security officer employed by the City, arrived quickly, even before emergency responders. Seconds after she arrived, the City's fire department unit known as Rescue 32 were also on site.

         Consistent with her training, Officer Elenez investigated and documented the names of witnesses and the following description of the incident:

Mr. Holger Viel was in the process of cutting off a lock for a Land Air Express truck to unload; he was bending over and cutting off the lock when the roll up Bay door dropped down on him, hitting him on his lower back. Mr. Salas, the truck driver and Fernando Pachilla [sic] another Service Air [sic] employee were standing by as the door dropped down on Mr. Viel. After the door struck him on his lower back, it knocked him forward pinning him between the truck and the bay door. Marco Parra, another Service Air [sic] employee ran around to check on Mr. Viel who was shaking but still conscious. Fernando then lifted the door with a fork lift [sic] holding the door open. They kept him sitting on the floor where he had landed until FMS arrived. Rescue 32 and ARFF 4 stabilized him on a back board and transported him to Del Sol Medical Center.

         At her deposition, Elenez provided further information about her on-scene observations as well as her actions after completing her investigation. Having received information about the overhead door striking Viel, Elenez testified she placed a service tag on the door so that "they make sure that -- who the responsible party fixes that door before it's used again so that there's not an issue that it is unsecure[.]" She then left the scene and reported ...


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