Untitled Texas Attorney General Opinion

The Attorney General of Texas
JIM MATTOX
Dr,cember23, 1985
Attorney General
Suprrme Court Building Honorable Bill Messer, Chairman Opinion No. JM-404
P. 0. BOX 12548 Calendars Committee
Austin, TX. 79711- 2548 Texas House of Representatives Re: Immmity of public officials
512/475.2501
P. 0. Box 2910 under the Texas Free Enterprise
-Telex 9101874-1367
Telecopier 5121475-0268
Austin, Texas 78769 and Antitrust Act of 1983
Dear Reoresentativ,eMesser:
714 Jackson. Suite 700
Dallas, TX. 75202-4503
You have rquested our opinion regarding the extent of the
2141742-8944
immunity granted I:O officers and employees of governmental entities
acting in their cfficial capacity under the Texas Free Enterprise and
4824 Alberta Ave.. Suit0 160 Antitrust Act of 1383.
El Paso. TX. 799012793
915/5333464 The Texas Free Enterprise and Antitrust Act of 1983 [hereinafter
the "Act"] broitdly prohibits anticompetitive conduct affecting
1001 Texas. Suite 700 trade and conmerc:e in the state of Texas. Tex. Bus. & Conrm. Code
Houstm, TX. 77W2G3111 $15.05(a)-(d). There are civil and criminal sanctions for violating
71312255880 the Act's prohibit:lons,and persons injured by a violation may sue for
injunctive relied' and damages. Id. 9915.20, 15.21, 15.22. Treble
damages may be awarded if theunlawful conduct was willful or
606 Broadway. Suite 312
Lubbock, TX. 79401-3479
flagrant. Id. IX.21. The purpose of the Act is to "maintain and
806/747-5238 promote econzc competition within this State." -Id. $15.04.
Section 15.21(a)(l) of the Act provides in part:
43~9 N. Tenth, Suite 6
McAlle”, TX. 78501-1685
512,882-4547 Any person or governmental entity, including
the State of Texas and any of its political sub-
divisioms or tax-supported institutions, whose
2w Main Plaza, Suite 400 business or property has been injured by reason of
sari Antonio, TX. 78205-2797
any conduct declared unlawful in Subsection (a),
51212254191
(b), or (c) of Section 15.05 of this Act may sue
any person, other than a municipal corporation, in
An Equal OppOrtUnitYI district court in any county of this state. . . .
Affirmative Action EmploW (Emphasis added).
The term "person" :Ls defined in section 15.03(3) which provides:
The tlerm'person' means a natural person, pro-
prietombip, partnership, corporation, municipal
corpora::ion.association, or any other public or
private group, however organized, but does not
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Honorable Bill Messer - Page 2 ,(JM-404)
include the State of Texas, its departments, and
its administrativ{ agencies. (Emphasis added).
Thus, the Act's definition of "pcrsoa" expressly excludes the State of
Texas, its departments, and its administrative agencies, while
municipal corporations are expressly excepted from suit under section
15.21(a)(l). See also Tex. Bus. & Comm. Code §§15.20, 15.22 (enforce-
ment suits against "any person, other than a municipal corporation").
The term %uniciual coruoration'l is not defined in the Act.
However, the general meaning'of the term includes other political
subdivisions organized under state law. See Welch V. State, 148
S.W.2d 876 (Tex. Civ. App. -.Dallas 1941, wrrref'd); see also State
V. Texas Municipal Power Agency, 565 S.W.2d 258 (Tax. Civ. Apr
Houston tlst Dist.1 1978, D'Dwrit). In addition, the leaislature is
authorized to create municipal corporations other than those set out
in the constitution, such as counties, cities or school districts, or
those which are authorized under special provisions of the constitu-
tion, such as water districts or flood control districts. -- See Davis
V. City of Lubbock, 326 S.W.2d 699 (Tex. 1959). Accordingly, we
conclude that the immunity granted to municipal corporations under the
Act extends to all politic:L:lsubdivisions organized under the consti-
tution and statutes of this state.
The Act does not aidress the immunity of state and local
officials from personal liability under its provisions. Official
immunity is a common law doctrine developed by the courts so that
public officers could carrg out discretionary duties without fear of
personal liability for m3stak.a judgment. Campbell V. Jones, 264
S.W.2d 425 (Tex. 1954); R;~:;nsV. Simpson, 50 Tex. 495 (1878). The
doctrine of official immu``:y is certainly not absolute. It does not
bar a suit to enjoin a public official's unauthorized act. --See Texas
Highway Commission V. Texas Association of Steel Importers, 372 S.W.2d
525 (Tex. 1963); Bullock v: Hardin. 578 S.W.2d 550 (Tex. Civ. App. -
Austin 1979. writ ref'd n7c.e.). Nor does it aoolv to ministerial
functions. -Rains V. Simpsc~n,5d ~Tex.~495 (1878);~'seealso Worsham V.
Votgsberger, 129 S.W. 157 (T'ex.Civ. App. 1910, no writ).
Judges, including justices of the peace, are immune from personal
liability for all acts cr omissions arising in the course of a
judicial proceezg over w'hich they have jurisdiction. Turner V.
Pruitt, 342 S.W.2d 422 (Tex. 1961). Cf. Pulliam V. Allen, 104 S. Ct.
1970 (1984); Stump V. Spar=, 435u.s. 349 (1978) (state judges
enjoy absolute immunity from damage liability in civil rights suits
under 42 U.S.C. section 19f'3but may be required to pay attorney fees
in successful suits for injunctive relief). Only when a judge clearly
acts without jurisdiction nay he be held personally liable in a damage
suit under the act. --
Turner V. Pruitt, supra. Similarly, legislators,
including city council members , are entitled to absolute immunity from
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Honorable Bill Messer - Pa:r,e
3 ,(JM-404)
civil damage suits for am:ts taken in a legislative capacity. See
Affiliated Capital Corp. vL City of Houston, 735 F.Zd 1555, 1568 (5th
Cir. 1984). Other officers who perform discretionary functions have
only a qualified immunity ~E~:om
suit for personal liability. Harlow V.
Fitzgerald, 457 U.S. 800 #:1982) (presidential aides); Campbell V.
Jones, 264 S.W.2d 425 (Tm:. 1954) (school trustees); Sanders State
Bank V. Hawkins, 142 S.W. 84 (Tex. Civ. App. - Texarkana 1911, no
writ) (State Commissioner #of Insurance and Banking). Their discre-
tionary functions are described as "quasi-judicial" functions.
The Texas courts apply a different test from the federal courts
to determine whether an of,E:Lcer's
qualified immunity protects him from
personal liability. A quasi-judicial officer who acts within his
legal authority is not lirble for daamges, no matter what his motive
is. Sanders State Bank v.Jawkins, supra. Texas courts will find him
liable for mistaken judgmmt or unauthorized acts only when he has
acted willfully or malici~msly. Campbell V. Jones, supra; Stein V.
Highland Park Independent School District, 540 S.W.2d 551 (Tex. Civ.
APP. - Texarkana 1976) a,ff'd 574 S.W.2d 807 (Tax. Civ. App. -
Texarkana 1978, writ di&;L);anders State Bank V. Hawkins. supra.
As other Texas courts have formulated this test, a quasi-judicial
officer is entitled to immunity as long as actions taken in his
official capacity are in j:ood faith. Augustine V. Nusom, 671 S.W.2d
112 (Tex. App. - Houston l:1.4thDist.] 1984, writ ref'd n.r.e); Baker
V. Story, 621 S.W.2d 639 (:Tax.App. - San Antonio 1981, writ a
n.r.e.); Morris v. Nowotq, 323 S.W.2d 301 (Tex. Civ. App. - Austin
1959, writ ref'd n.r.e.), cert. denied 361 U.S. 889, 361 U.S. 921
(1959). The Texas test can be characterized as a subjective test,
because the officer's motivation for his unauthorized conduct controls
whether or not he is inmum from suit for damages.
The United States Su~lremeCourt has developed an objective test
for determining the qualj.fied immunity of officers. In Harlow V.
Fitzgerald, 457 U.S. 800 (,L982),the court held that
government offj,cials performing discretionary
functions, generally are shielded from liability
for civil damagw insofar as their conduct does
not violate clearly established statutory or
constitutional rQ:hts of which a reasonable person
would have known,
457 U.S. at 818. Under th:lstest, the officer's immunity depends upon
what "a reasonable person vould have known," and subjective intent for
the action is not considencd.
Prior decisions had developed a "good faith" standard, an
affirmative defense which the defendant official had to plead. The
"good faith" standard com:isted of both an objective and subjective
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Honorable Bill Messer - PaE;e,
4 (JM-404)
aspect. 457 U.S. at 815; ---
me Wood V. Strickland, 420 U.S. 308 (1975).
Qualified imsamity vould be:defeated if the official
knew or reasonaLLy should have known that the
action he took within his sphere of official
responsibility would violate the constitutional
rights of the I:plaintiff],z if he took the
action with the-ealicious intention to cause a
deprivation of constitutioual rights or other
injury. . . . (Emphasis in original).
457 U.S. at 815 (quoting Wood V. Strickland). The Harlow court
rejected the subjective element of the good faith defense because it
raised a fact question which could not be resolved on suaxnaryjudgment
and thus frustrated the court's policy that insubstantial claims
should not proceed to trial. Therefore, in Barlow the court abandoned
the subjective element of the two part test for official immunity in
favor of the test quotetl above, which relies "on the objective
reasonableness of an offi~:ial's conduct, as measured by clearly
established law. . . ." 457 U.S. at 818.
The Texas courts have applied the malice test for decades, and we
believe they would apply Lt to questions of official immunity from
civil suits under the Texas Free Enterprise and Antitrust Act. See.
s, Augustine V. Nusom, iiw Sanders State Bank V. Hawkins, v
Wright v. Jones, 38 S.W. 249 (Tex. Civ. App. 1896, writ ref d).
During the time the United States Supreme Court applied the two part
"good faith" test for official immunity, the Texas courts continued to
apply the traditional test based on malicious or willful conduct. See
Baker V. Stop, supra; St'ain V. Highland Park Independent School
District, supra; see also%lcedo V. Diax, 647 S.W.2d 51 (Tex. App. -
El Paso 1983). writ ref'd ;r.e. in part, granted in part, 650 S.W.2d
67 (Tex. 1983), rev'd 659 lj.W.2d 30 (Tex. 1983). The Texas courts
have adhered to the long--established Texas common law test for
qualified official immunity and have not adopted or been influenced by
recent developments in the :Eederalcommon law test. In our opinion,
the Texas courts would apply the traditional malice standard to
determine official immunit.]~from liability for civil suits under the
Texas Free Enterprise and Antitrust Act.
The legislature, in ou'c opinion, did not change the common law
rule on official immunity by enacting the antitrust law. Section
15.04 does provide:
The purpose cf this Act is to maintain and
promote economic competition in trade and commerce
occurring wholly or partly within the State of
Texas and to provide the benefits of that competi-
tion to consumers in the state. The provisioas of
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Honorable Bill Messer - PaL;e5 (JM-404)
this Act shall be construed to accomplish this
purpose and shah be construed in harmony with
federal judicia:: interpretations of comparable
federal antitrur~, statutes to the extent con-
sistent with thirrpurpose. (Emphasis added).
The Fifth Circuit has applied the Barlow objective.test in a lawsuit
brought under the Sherman Act. SeeAffiliated Capital Corp. V. City
of Houston, 735 F.2d 1555 (5th C% 1984). In following Barlow, the
Fifth Circuit did not interpret any word or provision of the federal
antitrust statute. It instead applied a common law concept which
exists outside of any statute to determine whether it could exercise
judicial power over a partLcular public officer. Cf. Director of the
Department of Agriculture 1~ Printing Industries Association of Texas,
600 S.W.2d 264 (Tex. 1980) (sovereign immuuity from injunction suit).
The Harlow standard defines the federal court's power to hold
quasi-judicial officers pec:sonallyliable in damages for mistakes of
law; it does not construe the language of the Sherman Act. Section
15.04 does not require the Texas courts to adopt the Fifth Circuit
ruling on official immuni~:y in Affiliated Capital Corp. V. City of
Houston.
The legislature has nade the state liable for actual damages,
court costs and attorney fees adjudged against a state officer or
employee sued for an act ,XC omission in the scope of his office or
employment if
(1) the damaS,esarise out of a cause of action
for negligence. ,Eccept a willful or wrongful act
or an act of groez negligence; or
(2) the damages arise out of a cause of action
for deprivation cf a right, privilege, or immunity
secured by the constitution or laws of this state
or the United States, except when the court in its
udgment or the jury in its verdict finds that the
officer, contrack, or employee acted in bad
faith. (Emphasis-added).
V.T.C.S. art. 6252-26, 91. The legislature has used the subjective
test for official immunity to separate the officers whose damages and
legal expenses the state will pay from those whom it will leave to
their own resources. It is unlikely that the legislature which
finances the defense of public officers for acts of ordinary
negligence or good faith v:.olationsof legal rights would also intend
an officer to be civilly liable under the antitrust act if his conduct
violated statutorv riahts "of which a reasonable nerson would have
known." Harlow ;. Fitsger,ald, 457 U.S. at 818.~ See also V.T.C.S.
art. 6252-19b, 02(a) (policE1 subdivisions may pay actual damages,
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Honorable Bill Messer - Page 6 (JM-404)
court costs, and attorney jieesin negligence suits against officers).
In our opinion, the Texas 'P:eeeEnterprise and Antitrust Act does not
change the Texas common law standard for qualified immunity of public
officials. Under this st~ldard, public officials will be personally
liable for quasi-judicial s.ctionsin violation of the Act if they act
willfully or maliciously.
SUMMARY
Judges and legislators are entitled to absolute
immunity from civil damage suits under the Texas
Free Enterprise and Antitrust Act of 1983,
codified as sectllms 15.01 through 15.26 of the
Texas Business ~vi Coarmerce Code. No such suit
may be maintained against a judge or legislator
for acts or violations taken as part of the
judicial or lg!g;islative process. Executive
officials with discretionary duties are entitled
to qualified immmity from civil damage suits
under the Texas antitrust laws. Such public
officials are ilmune from such suits for un-
authorized acts wcthin the scope of their official
duties unless theg have acted willfully or malici-
ously. Any public official may be sued to enjoin
unauthorized acts or omissions.
JIM MATTOX
Attorney General of Texas
JACXHIGHTOWER
First Assistant Attorney Gesaral
NARY KELLER
Executive Assistant Attorncr General
ROBERT GRAY
Special Assistant Attorney 'Zenera
RICX GILPIN
Chairman, Opinion Committee
Prepared by Susan L. Garrism
Assistant Attorney General
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