Lone Star Groundwater Conservation District, Richard J. Tramm, Sam W. Baker, M. Scott Weisinger, Jim Stinson, John D. Bleyl, Jace Houston, Roy McCoy Jr., Rick Moffatt, and W. B. Wood v. City of Conroe, Texas, Quadvest, L.P., Woodland Oaks Utility, L.P., Crystal Springs Water Co., Inc., Everett Square, Inc., E.S. Water Consolidators, Inc., Utilities Investment Co., Inc., and T&W Water Service Company , 2017 Tex. App. LEXIS 925 ( 2017 )

In The
Court of Appeals
Ninth District of Texas at Beaumont
____________________
NO. 09-16-00201-CV
____________________
LONE STAR GROUNDWATER CONSERVATION DISTRICT, RICHARD
J. TRAMM, SAM W. BAKER, M. SCOTT WEISINGER,
JIM STINSON, JOHN D. BLEYL, JACE HOUSTON, ROY MCCOY JR.,
RICK MOFFATT, AND W.B. WOOD, Appellants
V.
CITY OF CONROE, TEXAS, QUADVEST, L.P., WOODLAND OAKS
UTILITY, L.P., CRYSTAL SPRINGS WATER CO., INC.,
EVERETT SQUARE, INC., E.S. WATER CONSOLIDATORS, INC.,
UTILITIES INVESTMENT CO., INC., AND
T&W WATER SERVICE COMPANY, Appellees
_______________________________________________________ ______________
On Appeal from the 284th District Court
Montgomery County, Texas
Trial Cause No. 15-08-08942-CV
________________________________________________________ _____________
OPINION
In this interlocutory appeal, the Lone Star Groundwater Conservation District1
and its Directors seek appellate review of orders overruling their pleas to the
1
Throughout the opinion, we refer to Lone Star Groundwater Conservation
District as “the District,” and its directors as “Directors.”
1
jurisdiction. In their pleas, the District and the District’s directors challenged the trial
court’s power to decide the claims of several “Large Water Producers,”2 who sued
the District and its directors because the District was threatening to enforce
groundwater production rules that the Large Water Producers asserted in the suit
were invalid. According to the Large Water Producers, the rules they challenge are
invalid because they attempt to regulate the production of groundwater in ways the
Legislature never authorized.
While the Large Water Producers’ petition includes claims that the pleas did
not address, this appeal, with respect to the District, concerns the Large Water
Producers’ challenge to the validity of the District’s rules that placed limits on the
volume of groundwater that each Large Water Producer was allowed to produce on
a yearly basis from its wells. See Tex. Civ. Prac. & Rem. Code Ann. §§ 37.001-.011
(West 2015) (Declaratory Judgments Act). While the Large Water Producers
acknowledge that the Legislature delegated some authority to the District to regulate
groundwater, they claim the Legislature did not authorize groundwater districts to
place annual production limits on individual groundwater producers regardless of
2
In the opinion, we refer to the group of plaintiffs that sued the District and
its Directors as “Large Water Producers.” The members included in the group
referred to as Large Water Producers are: The City of Conroe, Texas, Quadvest, L.P.,
Woodland Oaks Utility, L.P., Crystal Springs Water Co., Inc., Everett Square, Inc.,
E.S. Water Consolidators, Inc., Utilities Investment Co., Inc., and T&W Water
Service Company.
2
the number of wells or acreage owned by a producer. Additionally, in its petition,
the Large Water Producers asserted section 37.009 of the Declaratory Judgments
Act authorized their recovery of fees from the District should they prevail on the
claims they raised in their suit. See Tex. Civ. Prac. & Rem. Code Ann. § 37.009
(authorizing trial courts, in suits filed under the Declaratory Judgments Act, to award
reasonable and necessary attorney’s fees and costs as are equitable and just).
In response to the petition, the District asserted that while the Declaratory
Judgments Act generally authorizes courts to consider challenges asserting that a
statute or ordinance is invalid, it claimed the Act did not authorize the courts to
consider complaints about the validity of a governmental entity’s rules. See id. §
37.004 (Subject Matter of Relief). The District also argues that the Declaratory
Judgments Act does not operate as a general waiver of immunity, and that it did not
waive immunity with respect to claims seeking to recover attorney’s fees.
The Directors’ plea asserted that they were immune from all of the claims the
Large Water Producers were making in their suit. According to the Directors,
because the Large Water Producers’ claims all concern their votes on rules adopted
by the District, the Water Code immunized them from the claims which were all
based on their official votes or actions. See Tex. Water Code Ann. § 36.066(a) (West
Supp. 2016). On appeal, the Directors argue that the trial court should have
3
dismissed them from the suit based on the immunity the Legislature extended to
them in section 36.066(a) of the Texas Water Code. Id.
With respect to the arguments the Directors raise in their appeal, we agree that
the Large Water Producers’ claims are based entirely on the votes the directors cast
on the rules the Large Water Producers have challenged in their suit. Because the
Water Code immunizes directors of groundwater districts from claims that are based
on their votes as directors, we hold that the trial court abused its discretion when it
denied the Directors’ pleas. Id.
With respect to the District’s appeal, we conclude that the Texas Water Code
expressly authorizes courts to consider challenges that concern the validity of a
groundwater district’s rules. We further conclude that the Legislature, in the Water
Code, expressly authorized the courts to remedy a successful challenge to the
validity of a groundwater district’s rules by declaring the groundwater district’s rules
invalid. See Tex. Water Code Ann. § 36.251 (West Supp. 2016) (providing that
anyone affected by a rule of a groundwater district may file suit against the district
to challenge the validity of the rule); Tex. Water Code Ann. § 36.254 (West 2008)
(as to groundwater districts, making the Water Code cumulative of other legal and
equitable remedies). Consequently, we hold the trial court did not abuse its discretion
by denying the Large Water Producers’ plea as to the claims the Large Water
Producers filed to challenge the validity of certain of the District rules. Nonetheless,
4
we further conclude that no provisions of the Texas Water Code authorize a court to
award attorney’s fees to a party who successfully challenges the validity of a
groundwater district’s rules. Additionally, the Declaratory Judgments Act does not
independently waive a groundwater district’s governmental immunity with respect
to claims for attorney’s fees. Compare Tex. Civ. Prac. & Rem. Code Ann. § 37.009
(generally authorizing attorney’s fees for proceedings that are brought under the
Declaratory Judgments Act), with Tex. Water Code Ann. § 36.066(g)-(h) (West
Supp. 2016) (authorizing courts to award attorney’s fees to a groundwater district if
the groundwater district prevails in a suit; however, provision is silent regarding
awarding attorney’s fees to a party who successfully challenges the validity of a
groundwater district’s rules). Therefore, we hold the trial court erred when it failed
to grant the District’s plea with respect to the Large Water Producers’ claims for
attorney’s fees.
Background
The Large Water Producers consists of several private and public entities that
produce groundwater from wells in Montgomery County. In 2015, dissatisfied with
the production limits the District created through the rulemaking authority delegated
to it by the Legislature, the Large Water Producers filed suit claiming that the rules
the District created imposing per-producer yearly production limits on their
5
production of groundwater were invalid because they purported to regulate the
production of groundwater in ways the Legislature never authorized.
In response to the suit, the District and the Directors filed pleas to the
jurisdiction. We note that all of the claims against the Directors were brought against
them in their official capacities as members of the District’s board. We further note
that for the purpose of this appeal, the Plaintiffs’ Fourth Amended Petition3 is the
petition that is the pleading that was before the trial court when it denied the pleas.
Approximately six months after the suit was filed, the trial court conducted a
hearing on the pleas. Three months after the hearing, the trial court denied both pleas,
concluding that it possessed subject-matter jurisdiction over all of the claims before
the court. The District and Directors then filed timely interlocutory appeals from the
trial court’s orders denying their pleas. See Tex. Civ. Prac. & Rem. Code Ann. §
51.014(a)(8) (West Supp. 2016) (authorizing interlocutory appeals from a trial
court’s ruling denying a governmental unit’s plea to the jurisdiction); Tex. A&M
3
The Large Water Producers’ Fourth Amended Petition includes claims
against the District based on section 36.251 of the Texas Water Code, which
authorizes suits against groundwater districts to challenge “the validity of [a] law,
rule, or order.” See Tex. Water Code Ann. § 36.251(a) (West Supp. 2016). While
the District argues that the Declaratory Judgements Act does not operate as an
independent waiver with respect to challenges to the validity of a groundwater
district’s rules, it does not argue that a court is not authorized to resolve such
challenges by virtue of the authority the Legislature delegated to courts in section
36.251(a) of the Water Code. Compare Tex. Civ. Prac. & Rem. Code Ann. § 37.004
(West 2015), with Tex. Water Code Ann. § 36.251(a).
6
Univ. Sys. v. Koseoglu, 233 S.W.3d 835, 844 (Tex. 2007) (explaining that section
51.014(a)(8) of the Civil Practice and Remedies Code allows a state official to
pursue an interlocutory appeal on a ruling denying the official’s plea).
Standard of Review
As a dilatory plea, a plea to the jurisdiction is used to defeat a plaintiff’s cause
of action without regard to whether the plaintiff’s claims have merit. See Bland
Indep. Sch. Dist. v. Blue, 34 S.W.3d 547, 554 (Tex. 2000). Generally, unless there is
a statute waiving a governmental entity’s right to governmental immunity or a claim
that the government took the defendant’s property, trial courts lack subject-matter
jurisdiction to hear suits that involve claims filed against governmental entities. See
Fed. Sign v. Tex. S. Univ., 951 S.W.2d 401, 403 (Tex. 1997); Duhart v. State, 610
S.W.2d 740, 741 (Tex. 1980). Given that governmental entities and their officials
are generally immune from suit, a plaintiff, when suing a governmental entity and
its officials, must file pleadings that “affirmatively demonstrate the court’s
jurisdiction by alleging a valid waiver of immunity.” Dallas Area Rapid Transit v.
Whitley, 104 S.W.3d 540, 542 (Tex. 2003). The purpose of requiring that the
pleadings demonstrate how a trial court possesses the right to hear the case exists so
that the trial court can be informed regarding the basis of the plaintiff’s claim
regarding how it can exercise subject-matter jurisdiction over the claims that have
7
been filed in the suit. See Tex. Ass’n of Bus. v. Tex. Air Control Bd., 852 S.W.2d
440, 443 (Tex. 1993).
On appeal, unless the jurisdictional facts are disputed, an appellate court
reviews a trial court’s ruling on a plea to the jurisdiction as a question of law. See
Tex. Dep’t of Parks & Wildlife v. Miranda, 133 S.W.3d 217, 226, 228 (Tex. 2004).
In appeals where the jurisdictional facts are not in dispute, we apply a de novo
standard in reviewing an appeal from a trial court’s ruling. Id. When reviewing a
ruling on a plea to the jurisdiction, we determine whether the pleadings before the
trial court contained sufficient factual allegations to allow the trial court to determine
that it had jurisdiction over the dispute. Id. In reviewing the facts the plaintiff chose
to allege in its pleadings, we are not to weigh whether the plaintiff’s claims have
merit; instead, we are to determine whether the pleadings and the evidence before
the trial court sufficiently demonstrated that the trial court could properly exercise
jurisdiction over the claims in dispute. See Cty. of Cameron v. Brown, 80 S.W.3d
549, 555 (Tex. 2002). If the facts alleged in the plaintiff’s pleadings are insufficient
to show that the trial court properly exercised jurisdiction over the dispute, but the
pleadings can be corrected by amendment, we must allow the plaintiff an
opportunity to amend its pleadings before dismissing the suit. Miranda, 133 S.W.3d
at 226-27. However, when the pleadings are not capable of being amended in a way
8
that would cure the pleading insufficiency, the appeals court is required to dismiss
the suit, with prejudice. See Harris Cty. v. Sykes, 136 S.W.3d 635, 639 (Tex. 2004).
The trial court’s resolution of the District’s and the Directors’ pleas relied
principally on the trial court’s interpretation of the Texas Water Code and the
Declaratory Judgments Act. See Tex. Water Code Ann. § 36.251; Tex. Civ. Prac. &
Rem. Code Ann. §§ 37.004, 37.009. A trial court’s interpretation of a statute is
reviewed using a de novo standard. See Johnson v. City of Fort Worth, 774 S.W.2d
653, 655-56 (Tex. 1989). When construing statutes, courts are required to determine
and give effect to the Legislature’s intent. See Nat’l Liab. & Fire Ins. Co. v. Allen,
15 S.W.3d 525, 527 (Tex. 2000). Moreover, an appeals court should determine the
intended meaning of a statute, if possible, from the language utilized in the statute
being considered. Id. If the statute being considered is not ambiguous, it is to be
interpreted based on its plain meaning. See St. Luke’s Episcopal Hosp. v. Agbor, 952
S.W.2d 503, 505 (Tex. 1997).
Governmental Immunity – The District
In their suit, the Large Water Producers challenged the validity of various
rules that the District adopted to govern the production of groundwater from wells
in Montgomery County. The Large Water Producers claimed that the rules they
challenged regulating the volume of groundwater that each could produce on a per
annum basis were invalid because the groundwater districts, while authorized to
9
create rules that regulated groundwater production in some way were not authorized
to regulate in the manner the District had chosen to regulate groundwater production
through its rules. In response to the petition, the District asserted that the Declaratory
Judgments Act did not waive its immunity because the Declaratory Judgments Act
applies to claims challenging the validity of statutes, but not to rules. In this appeal,
we note that the District has not challenged the claims the Large Water Producers
made to its rules regulating groundwater production under section 36.251 of the
Texas Water Code. See Tex. Water Code Ann. § 36.251 (authorizing suits against
groundwater districts for claims challenging a groundwater district’s rules). In a
separately filed plea, the Directors asserted that they were immune from all of the
Large Water Producers’ claims, including those that they had filed that were based
on the Texas Water Code.
Generally, the doctrine of governmental immunity includes the concept that a
governmental entity is immune from liability and immune from suit. See Lubbock
Cty. Water Control & Improvement Dist. v. Church & Akin, L.L.C., 442 S.W.3d 297,
300 (Tex. 2014) (citing Tooke v. City of Mexia, 197 S.W.3d 325, 332 (Tex. 2006)).
Like other governmental entities, groundwater districts have governmental
immunity unless the Legislature has waived the district’s right to governmental
immunity. See Tex. Water Code Ann. §§ 36.001(1), 36.001(15), 36.011(a) (West
2008 & Supp. 2016) (indicating that underground water districts are political
10
subdivisions of the State); Tex. Water Code Ann. § 36.251 (authorizing judicial
review of suits based on the Texas Water Code that challenge the validity of a
groundwater district’s law, rule or order); see also Kirby Lake Dev., Ltd. v. Clear
Lake City Water Auth., 320 S.W.3d 829, 835-36 (Tex. 2010) (noting that water
control improvement districts, which exist by virtue of Chapter 51 of the Texas
Water Code, and general law water districts, which exist by virtue of Chapter 49 of
the Texas Water Code, are political subdivisions of the State); Reata Constr. Corp.
v. City of Dallas, 197 S.W.3d 371, 374 (Tex. 2006) (noting that in Miranda, the
Court held that sovereign immunity from suit deprives a trial court of subject-matter
jurisdiction).
In its appeal, the District argues that under the Declaratory Judgments Act, (1)
it remains immune from the Large Water Producers’ ultra vires claims; (2) the
Declaratory Judgments Act does not authorize declaratory relief with respect to
challenges to a governmental entity’s rules; and (3) the Declaratory Judgments Act
does not waive a groundwater district’s immunity with respect to claims for
attorney’s fees. In response to the District’s arguments, the Large Water Producers
argue that (1) the Texas Water Code allows parties challenging a groundwater
district’s rules to rely on other statutes such as the Declaratory Judgements Act
where they apply to the action; (2) the Declaratory Judgments Act operates as a
waiver concerning the Large Water Producers’ claims that the District’s rules they
11
were challenging were invalid; and (3) groundwater districts are not immune from
claims for attorney’s fees because the Declaratory Judgments Act provides that a
trial court may award attorney’s fees and the Water Code provides that its provisions
are cumulative of other remedies.
First, we address the Large Water Producers’ argument that the Declaratory
Judgments Act waived the District’s right to governmental immunity with respect to
the challenge the Large Water Producers had made to the validity of the District’s
rules. Generally, we observe that the Declaratory Judgments Act is not a statute that
courts have construed as the type of statute that waives a governmental entity’s
immunity from suit. See Sw. Bell Tel., L.P. v. Emmett, 459 S.W.3d 578, 587 (Tex.
2015); City of El Paso v. Heinrich, 284 S.W.3d 366, 373 (Tex. 2009). Nevertheless,
the Large Water Producers’ argument does not depend solely on the Declaratory
Judgments Act, as their pleadings alleged that the Water Code authorized the trial
court to hear their claims challenging the District’s rules. See Tex. Water Code Ann.
§ 36.251 (authorizing suits against groundwater districts “to challenge the validity
of the law, rule or order”). Section 36.251 of the Water Code provides:
(a) A person, firm, corporation, or association of persons affected
by and dissatisfied with any rule or order made by a district, including
an appeal of a decision on a permit application, is entitled to file a suit
against the district or its directors to challenge the validity of the law,
rule, or order.
12
(b) Only the district, the applicant, and parties to a contested case
hearing may participate in an appeal of a decision on the application
that was the subject of that contested case hearing. An appeal of a
decision on a permit application must include the applicant as a
necessary party.
(c) The suit shall be filed in a court of competent jurisdiction in
any county in which the district or any part of the district is located.
The suit may only be filed after all administrative appeals to the district
are final.
Id.
According to the Large Water Producers, the Declaratory Judgments Act
waives a governmental entity’s immunity from a declaratory judgment claim where
the claims are based on alleged ultra vires acts of the entity’s officials. However, we
find no provision in the Declaratory Judgments Act that waives immunity with
respect to ultra vires claims, particularly since the Texas Supreme Court has
explained that the Act does not operate as an independent waiver. See Emmett, 459
S.W.3d at 587; Heinrich, 284 S.W.3d at 373. However, the Large Water Producers’
pleadings also asserted that section 36.251 of the Texas Water Code authorized
courts to consider challenges to a groundwater district’s rules when all
administrative appeals are final.4 See id. In this appeal, the District did not argue at
4
Although the District’s plea to the jurisdiction alleges that the Large Water
Producers failed to exhaust their administrative remedies, that pleading related only
to rules the District adopted that are referred to as “desired future conditions.” After
the District filed its plea, the Large Water Producers amended their petition and
dropped their complaint that the rules regarding desired future conditions were
13
trial or in its appeal that the Large Water Producers failed to exhaust their
administrative remedies regarding the rules that were being challenged. And, since
the Texas Water Code provides that its provisions “do not affect other legal or
equitable remedies,” the Large Water Producers are entitled to rely on the
Declaratory Judgments Act regarding the challenge they presented to the validity of
the District’s rules. See Tex. Water Code Ann. § 36.254.
The District also argues that the Declaratory Judgments Act does not apply to
challenges to the validity of a groundwater district’s rules, and that the Act is limited
to challenges that are made to the validity of statutes and ordinances. Compare Tex.
Civ. Prac. & Rem. Code Ann. § 37.004 (Subject Matter of Relief), with Tex. Civ.
Prac. & Rem. Code Ann. § 37.003(c) (West 2015) (Power of Courts to Render
Judgment; Form & Effect). We disagree. Assuming without deciding that the Large
Water Producers exhausted their administrative remedies with respect to the rules
being challenged, section 36.251 of the Water Code authorizes a trial court to hear
complaints regarding the validity of a groundwater district’s rules, and section
36.066 of the Water Code allows groundwater districts to be sued for that purpose.
Tex. Water Code Ann. § 36.251; Id., § 36.066(a). We overrule the District’s first
two issues.
invalid. The rules regarding the desired future conditions are not the rules that are at
issue in the appeal.
14
In issue three, the District argues that the trial court does not possess subject-
matter jurisdiction over the Large Water Producers’ claim for attorney’s fees. In their
brief, the Large Water Producers argue that the Declaratory Judgments Act
authorizes courts to award a party that successfully obtains declaratory relief
attorney’s fees. In response, the District argues that neither the Texas Water Code
nor the Declaratory Judgments Act include an express waiver of governmental
immunity with respect to claims for attorney’s fees.
Section 37.009 of the Declaratory Judgments Act authorizes courts to award
attorney’s fees in declaratory judgment actions. Tex. Civ. Prac. & Rem. Code Ann.
§ 37.009. Nonetheless, a general authorization allowing a party to recover attorney’s
fees does not constitute an express waiver of a governmental entity’s right to
immunity from attorney’s fee claims. See Heinrich, 284 S.W.3d at 370 (noting that
the Declaratory Judgments Act “does not enlarge a trial court’s jurisdiction, and a
litigant’s request for declaratory relief does not alter a suit’s underlying nature”).
Importantly, the attorney’s fees provision in the Declaratory Judgments Act does not
contain language to indicate that it was intended to waive a governmental entity’s
right to immunity from claims for monetary damages, including attorney’s fees. See
Tex. Civ. Prac. & Rem. Code Ann. § 37.009.
In its brief, the District points out that a party who successfully challenges the
validity of a groundwater district’s rules under the provisions of the Texas Water
15
Code is not authorized to recover attorney’s fees. See Tex. Water Code Ann. §§
36.001-.419 (West 2008 & Supp. 2016). According to the District, the Legislature
could not have intended to authorize a successful challenger to a groundwater
district’s rules to recover attorney’s fees given that the Legislature, in the Water
Code, failed to authorize the recovery of such fees. See Patel v. Tex. Dep’t of
Licensing & Regulation, 469 S.W.3d 69, 79 (Tex. 2015) (“Under the redundant
remedies doctrine, courts will not entertain an action brought under the [Declaratory
Judgments Act] when the same claim could be pursued through different
channels.”).
While the Water Code generally authorizes Texas courts to hear a party’s
challenge to the validity of a groundwater district’s rules, the Water Code does not
authorize a party that prevails on such a challenge to recover attorney’s fees. See
Tex. Water Code Ann. §§ 36.001-.419. While the Water Code authorizes a
groundwater district to recover fees if it successfully defends its rules, the
Legislature chose not to give the challenger a reciprocal right to recover its fees. See
Tex. Water Code Ann. § 36.066(g). In our view, the Legislature’s decision not to
burden a groundwater district with a challenger’s claims for fees is a significant
factor that supports our conclusion that the trial court erred in failing to dismiss the
Large Water Producers’ claim for attorney’s fees.
16
The Large Water Producers suggest that by making the Water Code
cumulative of other remedies, the Legislature intended to allow a party that
successfully challenged a groundwater district’s rules to recover the attorney’s fees
it incurred in its action even though it did not authorize such a recovery within the
Water Code. See Tex. Water Code Ann. § 36.254 (Subchapter Cumulative); Tex.
Civ. Prac. & Rem. Code Ann. § 37.009 (Costs). However, neither the Declaratory
Judgments Act nor Texas Water Code contain provisions waiving a governmental
entity’s right to governmental immunity regarding claims for attorney’s fees. See
Tex. Civ. Prac. & Rem. Code Ann. § 37.009; Tex. Water Code Ann. § 36.251; see
also Tex. Dep’t of Transp. v. Sefzik, 355 S.W.3d 618, 621 (Tex. 2011); Heinrich,
284 S.W.3d at 370. In other words, even if declaratory relief is an available remedy
under the Declaratory Judgments Act, it does not follow that attorney’s fees are
available as well. See MBM Fin. Corp. v. Woodlands Operating Co., L.P., 292
S.W.3d 660, 669 (Tex. 2009). Generally, “the rule is that a party cannot use the
[Declaratory Judgments] Act as a vehicle to obtain otherwise impermissible
attorney’s fees.” Id. In this case, a challenger to a groundwater district’s rules cannot
recover attorney’s fees because such fees are not recoverable under the Water Code.
See Tex. Water Code Ann. § 36.066(g)-(h). Allowing a recovery of fees under the
Declaratory Judgments Act when they are not allowed under the Water Code would
violate the rule that a specific statute prevails over one that is more general. See
17
Jackson v. State Office of Admin. Hearings, 351 S.W.3d 290, 301 (Tex. 2011)
(holding that the plaintiff could not recover fees under the Declaratory Judgments
Act where his claims were based on the Texas Public Information Act and the
plaintiff failed to prove he was entitled to attorney’s fees under the provisions of that
Act); MBM Fin. Corp., 292 S.W.3d at 670 (concluding that the trial court erred by
allowing a recovery of attorney’s fees under the Declaratory Judgments Act when
the claim was not one that was allowed based on the plaintiff’s breach of contract
claim or otherwise available at common law).
We conclude that the Large Water Producers failed to allege a valid basis to
demonstrate that the trial court could properly exercise subject-matter jurisdiction
over the Large Water Producers’ claims for attorney’s fees. We hold the trial court
erred when it denied the District’s plea with respect to the claim the Large Water
Producers filed for attorney’s fees.
We further conclude that the Large Water Producers’ claim for attorney fees
should have been dismissed with prejudice. The record shows that the Large Water
Producers amended their pleadings several times before the trial court ruled on the
District plea, and they have not, in the appeal, explained how their pleadings could
be amended to demonstrate that the trial court could hear their claims seeking to
recover fees. Consequently, their claims for attorney’s fees must be dismissed, with
prejudice. See Sykes, 136 S.W.3d at 639 (requiring that an order granting a plea to
18
the jurisdiction dismiss the claim with prejudice where the plaintiffs’ pleadings
cannot be amended to cure the defect that bars the suit); Tex. R. App. P. 43.2(c).
Official Immunity - The Directors
The claims the Large Water Producers filed against the Directors were all
based solely on their duties as members of the groundwater district’s board.
Additionally, as to the Directors, the Large Water Producers’ claims were based on
the Directors votes to pass rules the Large Water Producers claimed were outside
the authority the Legislature extended to groundwater districts to regulate the
production of groundwater.
After they were sued, the Directors challenged whether the trial court could
hear the claims against them by filing a plea to the jurisdiction. The plea the
Directors filed asserts that section 36.066(a) of the Water Code immunized them as
board members of a groundwater district from being sued for their official votes and
actions as members of the District’s board. See Tex. Water Code Ann. § 36.066(a).
Section 36.066(a) of the Texas Water Code provides:
A district may sue and be sued in the courts of this state in the
name of the district by and through its board. A district board member
is immune from suit and immune from liability for official votes and
official actions. To the extent an official vote or official action
conforms to laws relating to conflicts of interest, abuse of office, or
constitutional obligations, this subsection provides immunity for those
actions. All courts shall take judicial notice of the creation of the district
and of its boundaries.
19
Id. The trial court did not make any written findings to explain why it had decided
to deny the Directors’ plea. However, we note that in this case, no claim was made
alleging that the Directors voted or took actions in violation of the rules or laws on
conflicts of interest, that the Directors abused their offices, or that the Directors
violated their constitutional obligations.
On appeal, the Directors argue that the trial court’s denial of their plea should
be overturned because (1) as directors, section 36.066(a) of the Texas Water Code
immunized them from the Large Water Producers’ claims that concerned their votes
in favor of the District’s rules; (2) the Declaratory Judgments Act did not authorize
Texas courts to resolve complaints about a governmental entity’s rules, in contrast
to challenges concerning the validity of ordinances or statutes; and (3) as the more
specific statute, the Texas Water Code and not the Declaratory Judgments Act
applies to the Large Water Producers’ complaints concerning the District’s rules.
In its brief, the Large Water Producers argue that section 36.066(a) of the
Water Code should be construed as a limited grant of immunity to the directors when
they are sued in their personal capacities, but that it should not be construed as a
grant of immunity if a groundwater district director is sued in the director’s official
capacity for exceeding the authority granted to directors by the Legislature to
regulate groundwater. To resolve the scope of the immunity the Legislature extended
to the members of a groundwater district’s board, we must construe the language the
20
Legislature chose to use in section 36.066(a) of the Texas Water Code. Tex. Water
Code Ann. § 36.066(a). In their brief, the Large Water Producers argue that when it
enacted section 36.066, the Legislature did not intend to immunize the directors of
a groundwater district’s board from claims alleging that the directors acted outside
the authority extended to them by the Legislature, i.e., claims for ultra vires acts.
See Houston Belt & Terminal Ry. Co. v. City of Houston, 487 S.W.3d 154, 158 n.1
(Tex. 2016) (recognizing that “when a governmental officer is sued for allegedly
ultra vires acts, governmental immunity does not apply from the outset”). The Large
Water Producers contend that the Directors’ votes approving rules beyond their
authority are actions the court should not consider as official acts under section
36.066(a). See Tex. Water Code Ann. § 36.066(a).
We apply a de novo standard to review the trial court’s conclusion that the
Directors were not immune from the Large Water Producers’ claims asserting that
they had passed rules that exceeded the authority extended to them by the Legislature
to regulate the production of groundwater. See State v. Shumake, 199 S.W.3d 279,
284 (Tex. 2006). When a statute is unambiguous, the words used in the statute are
to be given their common meaning. See Nat’l Liab. & Fire Ins. Co., 15 S.W.3d at
527; Fitzgerald v. Advanced Spine Fixation Sys., Inc., 996 S.W.2d 864, 865 (Tex.
1999). Additionally, the Water Code provides that the construction of the Water
Code should be based on the rules of construction found in Chapter 311 of the
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Government Code. See Tex. Water Code Ann. § 1.002 (West 2008) (requiring courts
to use the Code Construction Act to construe the Water Code); Tex. Gov’t Code
Ann. §§ 311.001-.034 (West 2013) (Code Construction Act). Under the Code
Construction Act, if the words of a statute are not expressly defined, the words used
in the statute are to be examined in context and in accord with “the rules of grammar
and common usage.” Tex. Gov’t Code Ann. § 311.011(a) (West 2013). Moreover,
we will not expand the plain meaning of a statute by enlarging on a word’s common
meaning. See Nat’l Plan Adm’rs, Inc. v. Nat’l Health Ins. Co., 235 S.W.3d 695, 701
(Tex. 2007) (“[W]e do not expand the meaning of statutes by implication[.]”); see
also Lenz v. Lenz, 79 S.W.3d 10, 19 (Tex. 2002) (“When construing a statute, we
ascertain the Legislature’s intent from the plain meaning of the actual language
used.”); Sorokolit v. Rhodes, 889 S.W.2d 239, 241 (Tex. 1994) (“In applying the
plain and common meaning of the language in a statute, courts may not by
implication enlarge the meaning of any word in the statute beyond its ordinary
meaning; such implication is inappropriate when legislative intent may be gathered
from a reasonable interpretation of the statute as it is written.”).
Generally, ultra vires claims involve suits against state officials and are based
on the claim that the official’s acts exceeded the authority the official possessed. See
Heinrich, 284 S.W.3d at 373. In cases alleging ultra vires claims, courts have
typically viewed the government officials of the entity, not the entity itself, as the
22
proper parties to a claim seeking to have a statute or ordinance declared invalid. See
id. at 373, n.6 (recognizing that by requiring the relevant governmental entity to be
made a party to a suit seeking a declaratory judgment that an ordinance or statute
was invalid, the Declaratory Judgments Act “requires that the relevant governmental
entities be made parties, and thereby waives immunity”) (citing Tex. Civ. Prac. &
Rem. Code Ann. § 37.006(b) (West 2015)). Although the government officials are
generally named as the party to a claim based on an alleged ultra vires act, courts
have nevertheless recognized that ultra vires claims are, for all practical purposes,
claims against the governmental entity to have a court declare a statute invalid. See
Heinrich, 284 S.W.3d at 373 (recognizing that suits against state officials in their
official capacities are suits that are “for all practical purposes [suits] against the
state”).
By allowing the validity of a groundwater district’s rules to be challenged in
court, the Legislature expanded the number of suits that groundwater districts and
their directors might face. In our opinion, section 36.066(a) of the Water Code
simply recognizes the practical reality that a groundwater district’s officials
generally need not be required to be formal parties to such suits. By allowing ultra
vires claims that concern the validity of a groundwater district’s rules to be filed
directly against groundwater districts, a groundwater district’s directors are no
longer needed as parties so long as no claim is being made that a director’s vote did
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not “conform to laws relating to conflicts of interest, abuse of office, or [the
director’s] constitutional obligations[.]” See Tex. Water Code Ann. § 36.066(a).
In their pleadings, and in their appeal, the Large Water Producers have not
alleged or argued that any of these exceptions to the general rule that a groundwater
district’s directors are immune for their votes apply. While the Large Water
Producers argue that the Legislature intended to make directors of groundwater
districts immune only in their personal capacities for their votes, we cannot interpret
section 36.066(a) so narrowly, as the provision grants directors of groundwater
districts immunity for their official votes and actions. Giving the provision such a
narrow meaning would effectively make the directors subject to suit for having voted
on a groundwater district’s rules, giving the provision a meaning that is plainly
inconsistent with the words the Legislature used in the statute. See Nat’l Plan
Adm’rs, Inc., 235 S.W.3d at 701.
We also do not agree with the Large Water Producers’ argument that section
36.066(a) gave the directors of groundwater districts unlimited immunity while
acting in their official capacities. Section 36.066(a) clarifies that the official board
member is immune “[t]o the extent an official vote or official action conforms to
laws relating to conflicts of interest, abuse of office, or constitutional obligations[.]”
Tex. Water Code Ann. § 36.066(a). Therefore, a director of a groundwater district
would not be immune if the director’s votes or acts included voting on a matter on
24
which the director had a conflict of interest, or if the vote related to the director’s
abuse of office,5 or if the vote violated the director’s constitutional obligations.6 See
id.
Reading section 36.066(a) as extending a limited degree of immunity to
directors of groundwater districts for voting on rules harmonizes section 36.066(a)
with section 36.251, as there are limited circumstances under which a director could
be made a party to a suit where the suit involved the director’s votes or actions. See
Tex. Gov’t Code Ann. § 311.025(b) (West 2013) (requiring amendments to the same
statute enacted at the same legislative session to “be harmonized, if possible, so that
effect may be given to each”); Tex. Water Code Ann. §§ 30.066(a), 36.251; see also
Clint Indep. Sch. Dist. v. Cash Investments, Inc., 970 S.W.2d 535, 539 (Tex. 1998)
(stating that “courts should not assign a meaning to a provision that would be
inconsistent with other provisions of the act”). Additionally, by reading section
36.066(a) to provide directors of groundwater districts a broad but limited degree of
immunity for their votes on a district’s rules avoids reading the waiver in section
36.066 as merely a codification of existing law. See Heinrich, 284 S.W.3d at 376
(noting that while the law generally allows claims against state officials where it is
5
See Tex. Penal Code Ann. §§ 39.01-.06 (West 2011 & Supp. 2016) (Abuse
of Office).
6
See Tex. Const. art. XVI, § 1 (Official Oath).
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proven that the officials acted outside their authority, the law then limits the
plaintiff’s remedy to prospective injunctive relief). Finally, our construction of
section 36.066(a) is consistent with the common meaning of the terms “official
votes” and “official actions,” as neither term is statutorily defined. See Tex. Water
Code Ann. § 36.001; Id. § 36.066(a). Black’s Law Dictionary defines “official act”
as “[o]ne done by an officer in his official capacity under color and by virtue of his
office.” BLACK’S LAW DICTIONARY 1084 (6th ed. 1990).
In the absence of a claim that the directors of a groundwater district voted
while having a conflict of interest, were guilty of abuse of office, or voted in
violation of their constitutional obligations they undertook in their oaths, the
directors of groundwater districts are immune from actions based on their votes as
directors. See Tex. Water Code Ann. § 36.066(a). We conclude that the Directors
are immune from the Large Water Producers’ claims alleging they enacted rules that
the Large Water Producers contend are invalid. We hold the trial court erred by
denying the Directors’ plea to the jurisdiction.
The record shows that the Large Water Producers amended their claims
several times before the trial court ruled on the Directors’ plea, and they never
alleged that any of the exceptions we have discussed apply to their claims. Therefore,
we further conclude that the claims against the Directors should be dismissed, with
prejudice. See Sykes, 136 S.W.3d at 639 (requiring that an order granting a plea to
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the jurisdiction dismiss the defendant, with prejudice, based on its claim of immunity
from suit if the record shows that the plaintiff had a reasonable opportunity to amend
its pleadings after the defendant filed its plea).7
Conclusion
We hold the Directors established that they were immune from being sued for
their official votes and actions in passing the rules the Large Water Producers
challenged in their Fourth Amended Petition. We reverse the trial court’s order
denying the Directors’ plea, and we render judgment dismissing the Directors from
trial court cause number 15-08-08942-CV, with prejudice.
With respect to the Large Water Producers’ claims against the District, we
affirm the trial court’s ruling except with respect to the claim for attorney’s fees. As
to the attorney’s fees claim, the trial court’s order is reversed and the trial court’s
order is reformed to read as follows: “Upon considering the pleadings, the plea,
response and reply, the evidence, and the arguments of counsel, the District’s plea
to the jurisdiction should be granted in part and denied in part. Regarding the Large
Water Producers’ claims for attorney’s fees under section 37.009 of the Civil
Practice and Remedies Code, the District’s plea is granted and the claim for
attorney’s fees is dismissed with prejudice. Otherwise, the District’s plea is denied.”
7
Given our resolution favoring the Directors on their plea, we need not reach
the Directors’ remaining arguments to resolve the issues the Directors raised in their
appeal. Tex. R. App. P. 47.1.
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AFFIRMED IN PART, REVERSED AND RENDERED IN PART.
_________________________
HOLLIS HORTON
Justice
Submitted on September 15, 2016
Opinion Delivered February 2, 2017
Before McKeithen, C.J., Horton and Johnson, JJ.
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