University of Houston v. Barth

OPINION

LAURA CARTER HIGLEY, Justice.

This is an interlocutory appeal of the trial court’s denial of appellant’s, the University of Houston (UH), plea to the jurisdiction.¹ Appellee, Stephen Barth, a tenured professor at the UH Conrad N. Hilton College of Hotel Management (Hilton College), filed suit against UH under the Whistleblower Act,² contending that his supervisor retaliated against him after Barth reported alleged accounting violations.

In seven issues, UH contends that the trial court erred in denying its plea and supplemental plea to the jurisdiction because (1) Barth did not timely file all of his grievances, (2) Barth did not timely file suit, and (3) several of the acts complained of were not “adverse personnel actions” as defined in the Whistleblower Act.

Factual & Procedural Background

Barth is a tenured professor at-Hilton College. In 1998, one of Barth’s colleagues told him that Alan Stutts, Dean of Hilton College, was pressuring him to perform what he termed “questionable” accounting transactions and practices. Barth reported these alleged violations to (among others) UH Provost Ed Sheridan and UH’s general counsel. On January 14, 2000, Barth discovered he had been denied a 1999 merit raise he contends he deserved under the merit evaluation guidelines. Barth filed a grievance on March 10, 2000. On August 17, 2000, two weeks after receiving final notice that he would not be given a 2000 merit raise, Barth filed his second grievance. On November 21, 2000, Barth filed a third grievance. Eventually, the second and third grievances were consolidated into a single grievance. Barth complained that, as retaliation for reporting accounting irregularities, Stutts: (1) attempted to breach Barth’s supplementary compensation agreement; (2) intimidated Barth’s assistant and other faculty members with whom Barth worked closely; (3) denied Barth travel money; (4) wrote an arbitrary and capricious evaluation of Barth’s performance; (5) withdrew support for Barth’s academic initiatives; (6) encouraged an associate to file a false discrimination claim against him; (7) alienated the students and faculty from Barth; (8) excluded Barth from an on-line graduate program; (8) excluded Barth from internal and external communications; and (9) defamed Barth before students and faculty.

The provost responded in part to the first grievance on May 31, 2000 and responded to the second and third grievances, and the issues remaining from the first grievance, in a letter dated June 5, 2001. Barth filed suit on July 5, 2001. However, correspondence between Barth and the provost continued until the fall. Although the provost noted in his June 5 letter that “[Sjince you have chosen not to appeal any of the Grievance Committee recommendations to me, I now regard this grievance procedure as ended,” Barth responded on June 18 with a request for just such an appeal. In a letter dated September 5, 2001, the provost noted, “[I]n response to your statement that the grievance process has been concluded, I wish to state it is not concluded, at least not due to any action or decision on my part.”

There was no further action taken in regard to Barth’s grievances and the suit went forward. After the trial court denied UH’s plea and supplemental plea to the jurisdiction, this interlocutory appeal ensued.

Plea to the Jurisdiction

A plea to the jurisdiction is a dilatory plea that seeks dismissal of a case for lack of subject-matter jurisdiction. Bland Indep. Sch. Dist. v. Blue, 34 S.W.3d 547, 554 (Tex.2000). Subject-matter jurisdiction is essential to the authority of a court to decide a case. See Mayhew v. Town of Sunnyvale, 964 S.W.2d 922, 928 (Tex.1998). Governmental immunity from suit defeats a trial court’s jurisdiction and so it may be raised by a plea to the jurisdiction. See Tex. Dep’t of Transp. v. Jones, 8 S.W.3d 636, 639 (Tex.1999).

Nature of Provisions of Whistleblower Act

As a preliminary matter, we address Barth’s contention that this Court has no jurisdiction to consider this appeal because the trial court could not entertain UH’s plea to the jurisdiction as a matter of law. Based on the Texas Supreme Court’s decision in Dubai Petroleum Co. v. Kazi, 12 S.W.3d 71, 76 (Tex.2000), in which the Supreme Court determined that the failure to allege and prove a statutory prerequisite to a statutory cause of action was not a jurisdictional defect, Barth contends that the limitations provision and grievance requirements of the Whistleblower Act are likewise not jurisdictional.

In making this argument, Barth relies on authority in which our sister appellate courts held that the provisions of the Whistleblower Act are not jurisdictional and asks us to overrule this Court’s decision to the contrary in a case directly on point here. See Tex. S. Univ. v. Carter, 84 S.W.3d 787, 792 (Tex.App.-Houston [1st Dist.] 2002, no pet.) (holding that statutory prerequisite that plaintiff in Whistleblower action timely initiate grievance before filing suit is jurisdictional issue that may be challenged by plea to jurisdiction). We recognize that other courts of appeal have applied Kazi to the Whistleblower Act and held that its statutory prerequisites are not jurisdictional. See, e.g., Univ. of Houston v. Elthon, 9 S.W.3d 351 (Tex.App.-Houston [14th Dist.] 1999, pet. dism’d w.o.j.); Castleberry Indep. Sch. Dist. v. Doe, 35 S.W.3d 777 (Tex.App.-Fort Worth 2001, pet. dism’d w.o.j.); Tex. Dep’t of Mental Health & Mental Retardation v. Olofsson, 59 S.W.3d 831 (Tex.App.-Austin, 2001, pet.dism’d). However, none of the cases addressing whether the Whistleblower Act’s provisions are jurisdictional has been reviewed by the Texas Supreme Court. In University of Texas Southwestern Medical Center at Dallas v. Loutzen-hiser, 140 S.W.3d 351, 360 (Tex.2004), the Texas Supreme Court, in addressing whether certain provisions of the Tort Claims Act³ were jurisdictional, distinguished a statutory presentment provision from a statutory exhaustion of remedies provision, noting that an exhaustion requirement seeks to ensure that “the appropriate body adjudicates the dispute — the hallmark of a jurisdictional statute.” Id. at 361 (citing Essenburg v. Dallas County, 988 S.W.2d 188, 189 (Tex.1998)). The Whistleblower Act requires initiation of remedies via the governmental entity’s grievance or appeal procedure before a party may file suit, but does not require exhaustion of remedies. See Tex. Gov’t Code Ann. § 554.006 (Vernon 2004). Thus, whether the Act’s requirements are jurisdictional is open to question. But this question has not yet been directly answered; rather, the court has expressly refrained from answering it. See Univ. of Tex. Med. Branch at Galveston v. Barrett, 159 S.W.3d 631, 632 (Tex.2005) (observing “[W]e need not decide here whether the failure to meet these requirements [of section 554.006] deprives the court of jurisdiction over the action.”). Accordingly, Carter, which is directly on point and in which this Court held — albeit for reasons not applicable here — that the requirements of section 554.006 are jurisdictional, governs disposition of the issue in the case before us. See Carter, 84 S.W.3d at 792; accord Harris County v. Lawson, 122 S.W.3d 276, 281 (Tex.App.-Houston [1st Dist] 2003, pet. denied) disapproved of on other grounds by Barrett, 159 S.W.3d at 633) (following holding in Carter and reiterating that Kazi did not overrule [Univ. of Texas Med. Branch v.] Hohman [6 S.W.3d 767 (Tex.App.—Houston [1st Dist.] 1999)]).

We therefore hold that the limitations provisions in the Whistleblower Act are jurisdictional; thus, we examine UH’s plea to the jurisdiction to determine whether the trial court erred in denying the plea.

Standards of Review

Because subject-matter jurisdiction presents a question of law, we review the district court’s decision de novo. Mayhew, 964 S.W.2d at 928. In reviewing a trial court’s ruling on a plea to the jurisdiction, we do not look at the merits of the case; rather, we construe the pleadings in favor of the plaintiff, look to the pleader’s intent, and accept the pleadings’ factual allegations as true. Tex. Ass’n of Bus. v. Tex. Air Control Bd., 852 S.W.2d 440, 446 (Tex.1993). We indulge every reasonable inference and resolve any doubts in the nonmovant’s favor. See Sci. Spectrum, Inc. v. Martinez, 941 S.W.2d 910, 911 (Tex.1997). However, if a plea to the jurisdiction challenges the existence of jurisdictional facts, we consider relevant evidence submitted by the parties when necessary to resolve the jurisdictional issues raised, as the trial court is required to do. See Bland, 34 S.W.3d at 555 (confining evidentiary review to evidence that is relevant to jurisdictional issue). When the consideration of a trial court’s subject matter jurisdiction requires the examination of evidence, the trial court exercises its discretion in deciding whether the jurisdictional determination should be made at a preliminary hearing or await a fuller development of the case, mindful that this determination must be made as soon as practicable. Id. at 554. If the evidence creates a fact question regarding the jurisdictional issue, then the trial court cannot grant the plea to the jurisdiction, and the fact issue should be resolved by the fact finder. See Tex. Dep’t of Parks & Wildlife v. Miranda, 133 S.W.3d 217, 227-28 (Tex.2004).

The Whistleblower Act prohibits retaliation against public employees who, in good faith, report violations of law by their employers. Tex. Gov’t Code Ann. § 554.002 (Vernon 2004). Because the statute is remedial in nature, we construe its provisions liberally to effectuate its legislative purpose — to enhance openness in government and compel the government’s compliance with the law by protecting those who inform authorities of wrongdoing. See Castaneda v. Tex. Dep’t of Agric., 831 S.W.2d 501, 503 (Tex.App.-Corpus Christi 1992, writ denied).

Time Limits

In its second, fourth, and fifth issues, UH contends Barth did not timely file his grievances. In making this argument, UH focuses solely on the date that each alleged adverse personnel action occurred. However, the Whistleblower Act requires an employee, before filing suit, to initiate action under the grievance procedure of the employer before filing suit, “not later than the 90th day after the date on which the alleged violation of this chapter: (1) occurred; or (2) was discovered by the employee through reasonable diligence.” Tex. Gov’t Code Ann. § 554.006(a), (b). Barth argues that, at a minimum, there is a fact issue as to whether Barth should have filed his grievances earlier. We agree. The continuing-violation doctrine has been applied to the Whistleblower Act. See Univ. of Tex.-Pan Am. v. De Los Santos, 997 S.W.2d 817, 820 (Tex.App.-Corpus Christi 1999, no pet.). Under this doctrine, the focus is on what event, in fairness and in logic, should have alerted the average layman to protect his rights. See Glass v. Petro-Tex Chem. Corp., 757 F.2d 1554, 1560 (5th Cir.1985). There are sufficient factual allegations in Barth’s pleadings that could invoke the continuing-violation doctrine; whether that doctrine applies and which acts triggered the 90-day limitations period are issues that should be resolved by the trier of fact. See Hill v. Burnet County Sheriffs Dep’t, 96 S.W.3d 436, 442 (Tex.App.-Austin 2002, pet. denied) (noting that court, in reviewing ruling on plea to jurisdiction, only determines whether plaintiffs pleadings are sufficient to invoke jurisdiction).

In its first issue, UH argues that Barth did not timely file suit. The Whistle-blower Act provides that, “if a final decision is not rendered before the 61st day after the date procedures are initiated ... the employee may elect to (1) exhaust the applicable procedures” and sue not later than the 30th day after exhausting them or (2) terminate the procedures initiated and sue within the time remaining of the 90-day limitations period. See Tex. Gov’t Code Ann. § 554.006(d). Here, 90 days had long since elapsed, thus Barth’s only choice was to bring suit not later than the 30th day after exhausting the grievance procedures.

Although UH contends that the procedure was exhausted on May 31, 2000, when the provost sent his initial letter to Barth, the record does not entirely support this contention. It was not until the letter of June 5, 2001 that the provost wrote, “I now regard this grievance procedure as ended.” A reasonable inference from this comment is that the grievance procedure was not ended before the provost wrote this letter. Because appellant filed suit on July 5, therefore, his suit was timely. If the continuing correspondence between Barth and the provost did not prolong the process, and if the provost’s remark in his letter, dated September 5, 2001, that “I wish to state it [the grievance procedure] is not concluded, at least not due to any action or decision on my part” likewise had no effect on whether the procedure was exhausted, UH still cannot prevail. In Lawson, this Court held that, as statutory prerequisites to filing a Whistleblower lawsuit, an employee who timely initiates the grievance procedure is entitled to file suit after giving the employer at least 60 days to reach a final decision. 122 S.W.3d at 283-84. Barth filed suit after 60 days had elapsed, and 30 days after receiving a letter in which the provost decreed the process finished.

We hold that the fact issues present in the questions of timely grieving and timely filing in this case precluded the trial court from granting the plea to the jurisdiction on the basis of limitations. See Miranda, 133 S.W.3d at 227-28 (holding that if evidence creates fact question regarding jurisdiction, trial court cannot grant plea to jurisdiction, and the fact issue should be resolved by fact finder).

We overrule the first, second, fourth, and fifth issues.

Adverse Personnel Actions

In its third and sixth issues, UH contends that the trial court lacked subject-matter jurisdiction because the actions about which Barth complained were not adverse personnel actions. In its seventh issue, it contends that sovereign immunity shields it from liability for defamation.

The Whistleblower Act defines an adverse personnel action as “an action that affects a public employee’s compensation, promotion, demotion, transfer, work assignment, or performance evaluation.” Tex. Gov’t Code Ann. § 554.001(3) (Vernon 2004). This is a broad definition, asthas been recognized by the courts. See, e.g., Tex. Dep’t of Mental Health & Mental Retardation v. Rodriguez, 63 S.W.3d 475, 481 (Tex.App.-San Antonio 2001, pet. denied) (rejecting state agency’s narrow construction of what constituted adverse personnel action). Any of the acts about which Barth complained in his grievances, and which underlie his suit, could reasonably be construed by a jury to be acts that, although only indirectly in some instances, “affected” Barth’s “compensation, promotion, demotion, transfer, work assignment, or performance evaluation.” We further note that Barth did not file a cause of action for defamation; rather he contended that his supervisor’s defamatory remarks were one of the actions that affected his employment.

As in the question of limitations, which (if any) of the acts about which Barth complains constituted adverse personnel actions is a contested fact issue that should be resolved by the trier of fact. See Hill, 96 S.W.3d at 442 (court did not need to determine whether retaliatory acts constituted constructive discharge, thus were not adverse action; court needed only to determine whether pleadings invoked trial court’s jurisdiction); see also Miranda, 133 S.W.3d at 227-28.

We overrule the third, sixth, and seventh issues.

We affirm the trial court’s denial of UH’s plea to the jurisdiction and supplemental plea to the jurisdiction.

Justice BLAND concurring.

1 . See Tex. Civ. Prac. & Rem.Code Ann. § 51.014(a)(8) (Vernon 1997 & Supp.2004-2005) (authorizing interlocutory appeal of denial of plea to jurisdiction).

2 . See Tex. Gov't Code Ann. § 554.002 (Vernon 2004).

3 . Tex. Civ. Prac. & Rem.Code Ann. §§ 101.021-.022 (Vernon 1997).