Midtown Edge, L.P. and Midtown Condominiums, L.L.C. v. the City of Houston

Opinion issued February 13, 2014
In The
Court of Appeals
For The
First District of Texas
————————————
NO. 01-12-00730-CV
———————————
MIDTOWN EDGE, L.P., AND
MIDTOWN CONDOMINIUMS, L.L.C., Appellants
V.
THE CITY OF HOUSTON, Appellee
On Appeal from County Civil Court at Law No. 4
Harris County, Texas
Trial Court Case No. 1003812
MEMORANDUM OPINION
In this interlocutory appeal, 1 appellants, Midtown Edge, L.P., and Midtown
Condominiums, L.L.C. (collectively, “Edge”), challenge the trial court’s order
granting the plea to the jurisdiction of appellee, the City of Houston (“the City”), in
1
TEX. CIV. PRAC. & REM CODE ANN. §.51.014(a)(8) (Vernon Supp. 2013).
Edge’s suit against the City for breach of contract, inverse condemnation,
declaratory judgment, and promissory estoppel. In four issues, Edge contends that
the trial court erred in granting the City’s plea.
We affirm.
Background
In its petition, Edge alleges that in July 2005, it began construction of a
condominium development project (the “Project”), consisting of ninety-three
residential units, located in the Midtown area of Houston. After Edge applied to
the City for use of its wastewater line, the City responded by letter, dated August 5,
2005, stating that a new wastewater line would need to be constructed because the
existing eight-inch wastewater line in the vicinity of the Project was inadequate to
accommodate the Project’s needs. In its letter, the City listed various “methods” of
financing the new line, noting that it could pay for all or some of the costs of
design and construction, or Edge could choose to pay the costs on its own. If the
City paid any portion of the costs, a contract between the City and Edge, approved
by City Council and executed by the Mayor, would be required. The City noted
that other financing methods could be used, including one in which Edge could
“ask” the City to establish a connection charge for any other property owner
subsequently connecting to the new line. To share the cost of constructing the line,
such an owner would be required to pay a pro rata charge, which would then be
2
forwarded to Edge. The City explained that upon “completion of the construction
of the line and acceptance of the project by the City, the line will be dedicated to
the City of Houston for ownership and maintenance.”
In its October 31, 2005 letter responding to the City’s letter, Edge stated that
it was “not requesting City of Houston cost sharing participation,” it “underst[ood]
that all cost sharing participation require[d] an approved contract by city council
prior to the construction of the utility,” and it understood that “requesting such
participation may result in the delay of a building permit being issued.”
Subsequently, the City issued a construction permit, and Edge constructed
the new line at a cost of $224,991.02. Upon completion, Edge dedicated the new
line to the City for its ownership and maintenance.
At some point, Pierce Street Flats (the “Flats”), a new apartment complex
constructed in the vicinity of the Project, connected to the new line. In 2007, Edge
applied to the City for reimbursement of $48,664, which it alleges was the Flats’s
pro rata share of Edge’s cost to construct the new line. And Edge notified the Flats
that it was responsible for a share of the construction costs of the new line. The
City denied reimbursement, and the Flats disconnected from the new line and
connected to the older eight-inch wastewater line.
Edge further alleges in its petition that the City’s letter concerning financing
of the new line constituted “a letter agreement,” a “valid, enforceable agreement”
3
between the City and Edge. It asserts that the City breached its obligations “under
this contract” by denying Edge’s request for reimbursement after the Flats
connected to the new line. And it further alleges that the Texas Legislature has
waived the City’s governmental immunity for purposes of such a breach–of–
contract claim. 2
Edge argues that the City, by denying reimbursement, committed an
unconstitutional “taking” because it intentionally took the new line for the benefit
of the public without compensating Edge and without Edge’s consent. Edge seeks
a judgment declaring that (1) it constructed the line “pursuant to a valid and
enforceable contract and municipal ordinance,” not only for its own benefit, but for
the benefit of the City and the public; (2) the City breached the contract by denying
reimbursement; and (3) the City violated Edge’s rights under the Texas
Constitution by taking Edge’s property without adequate compensation.
Alternatively, Edge asserts a claim for promissory estoppel, alleging that the City
made a promise, upon which Edge relied to its detriment, to reimburse Edge.
Finally, Edge claims that the Flats has been unjustly enriched. 3
In its answer, the City generally denies Edge’s allegations, and it asserts that
it is immune from suit. In its second amended plea to the jurisdiction, the City
2
See TEX. LOC. GOV’T CODE ANN. § 271.152 (Vernon 2005).
3
The Flats is a named defendant in the proceedings below. However, it is not
subject to the order sustaining the City’s plea to the jurisdiction, and it is not a
party to this appeal.
4
argues that Edge’s “breach of contract claim is barred by governmental immunity
from suit” because the City’s letter, “which Edge claims is the agreement upon
which its breach of contract claim is based” is not a contract. The City asserts that
Edge’s inverse condemnation claim is barred by immunity, and it argues that there
has not been an unconstitutional “taking” because Edge consented to the City’s
ownership of the new line by dedicating it to the City without objection. Further,
the City asserts that Edge’s claims for declaratory relief and promissory estoppel
are barred by governmental immunity.
To its plea, the City attached its letter to Edge, Edge’s letter to the City, and
the affidavit of R. Moreno, the City’s Division Manager of the Department of
Public Works and Engineering (the “Department”), Utilities Analysis Section. In
his affidavit, Moreno testified that he reviewed the City’s records and they reveal
that “since September 10, 2008, the date that Houston’s City Council . . .
approv[ed] the pro-rata reimbursement, no permit has ever been issued by [the
City] to any person located within the service area . . . to connect to the [new line]
and no money has been collected for the benefit of [Edge] from any third party.”
He noted that the City issued a permit to Black Finn Restaurant in August 2011 to
connect to a terminating manhole on the new line, but the City did not collect a
connection fee because the restaurant is “not located within the service area.”
5
The City also attached to its plea the affidavit of R. Mendez, an inspector for
the Department. Mendez testified that the Flats’s contractor had inadvertently
tapped into the new line, the City had not granted the Flats permission to tap into
the new line, the City instructed the Flats to disconnect from the line, and the Flats
complied.
Further, the City attached to its plea the affidavit of A. Sheridan, a
Department Supervising Engineer, who testified that Edge did not file the
documents necessary to complete its application for establishment of a pro-rata
reimbursement (rate) until July 2008.4 He noted that on September 10, 2008, the
City Council established a rate for connections to the New Line.
After a hearing, the trial court granted the City’s plea to the jurisdiction and
dismissed Edge’s claims.
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. Harris Cnty. v. Sykes, 136 S.W.3d 635, 638
(Tex. 2004); Villarreal v. Harris Cnty., 226 S.W.3d 537, 541 (Tex. App.—
Houston [1st Dist.] 2006, no pet.). We review de novo a trial court’s ruling on a
jurisdictional plea. See Ben Bolt-Palito Blanco Consol. Indep. Sch. Dist. v. Texas
Political Subdivisions Prop./Cas. Joint Self-Ins. Fund, 212 S.W.3d 320, 323 (Tex.
4
Edge sought reimbursement in 2007 for the connection pertaining to the Flats.
6
2006); City of Houston v. Vallejo, 371 S.W.3d 499, 501 (Tex. App.—Houston [1st
Dist.] 2012, pet. denied).
When a plea to the jurisdiction challenges the pleadings, we determine if the
pleader has alleged facts that affirmatively demonstrate the trial court’s
jurisdiction. Dep’t of Parks & Wildlife v. Miranda, 133 S.W.3d 217, 226–27 (Tex.
2004). We construe the pleadings liberally in favor of the plaintiff and look to the
pleader’s intent. Id. at 226. If the pleadings do not contain sufficient facts to
affirmatively demonstrate the trial court’s jurisdiction, but do not affirmatively
demonstrate incurable defects in jurisdiction, the plaintiff should be given an
opportunity to amend. Id. at 226–27. If the pleadings affirmatively negate the
trial court’s jurisdiction, then a plea to the jurisdiction may be granted without
allowing an opportunity to amend. Id. at 227.
If a plea to the jurisdiction challenges the existence of jurisdictional facts,
we consider the parties’ relevant evidence submitted when necessary to resolve the
jurisdictional issues raised. Id. If the evidence creates a fact question regarding
jurisdiction, a plea to the jurisdiction cannot be granted and a factfinder must
resolve the factual issue. Id. at 228. If the relevant evidence is undisputed or fails
to raise a fact issue concerning jurisdiction, the plea to the jurisdiction must be
determined as a matter of law. Id.
7
When reviewing a plea to the jurisdiction in which the pleading requirement
has been met and evidence, which implicates the merits of the case, has been
submitted to support the plea, we take as true all evidence favorable to the
nonmovant and we indulge every reasonable inference and resolve any doubts in
the nonmovant’s favor. Id. at 227.
Jurisdictional Limits and Ripeness
As threshold matters, the City argues that the trial court did not err in
granting its plea to the jurisdiction because Edge’s claims exceed the jurisdictional
limits of the county court and they are not ripe for adjudication.
Jurisdiction in statutory county courts includes “civil cases in which the
matter in controversy exceeds $500 but does not exceed $200,000, excluding
interest, statutory or punitive damages and penalties, and attorney’s fees and costs,
as alleged on the face of the petition.” TEX. GOV’T CODE ANN. § 25.0003(c)(1)
(Vernon Supp. 2013). On the face of its petition, Edge seeks reimbursement of
$48,664 and other unspecified amounts. Thus, Edge states a claim within the
jurisdictional limits of the county court. Although Edge asserts that it paid
$224,991.02 to construct the new line, it does not seek this amount as its alleged
damages.
The City argues that Edge’s claims are not ripe because Edge does not
“claim that the City has ever issued a permit to any third party located within the
8
service area to connect to [the new line] or collected any money in accordance with
the terms” of the City Council’s approval of the pro-rata reimbursement.
Ripeness implicates subject-matter jurisdiction and emphasizes the
requirement of a concrete injury in order to present a justiciable claim. Waco
Indep. Sch. Dist. v. Gibson, 22 S.W.3d 849, 851 (Tex. 2000). Ripeness concerns
whether, at the time a lawsuit is brought, the facts have developed sufficiently such
that an injury has occurred or is likely to occur, rather than being contingent or
remote. Patterson v. Planned Parenthood of Houston and Se. Tex., Inc., 971
S.W.2d 439, 442 (Tex. 1998); City of Houston v. Norcini, 317 S.W.3d 287, 292
(Tex. App.—Houston [1st Dist.] 2009, pet. denied). To establish that a claim is
ripe based on an injury that is likely to occur, the plaintiff must demonstrate that
the injury is imminent, direct, and immediate, and not merely remote, conjectural,
or hypothetical. Gibson, 22 S.W.3d at 852. By focusing on the concreteness of
injury, the ripeness doctrine allows a court to avoid premature adjudication and
issuance of advisory opinions. Id.
Here, it is undisputed that the Flats connected to the new line, and, in 2007,
Edge sought reimbursement, which the City declined. In its original petition, Edge
alleged that an injury had occurred because the City allowed the Flats to connect to
the new line without collecting sums owed to Edge.
9
Considering Edge’s allegations and jurisdictional evidence, taking as true all
evidence favorable to Edge and indulging every reasonable inference and resolving
any doubts in its favor, as we must, we conclude that Edge alleges that a concrete
injury has occurred. Moreover, it is undisputed that, during the pendency of this
suit, Black Finn Restaurant connected to some portion of the new line.
Accordingly, we conclude that Edge states claims within the trial court’s
jurisdictional limits and they are ripe for adjudication.
Governmental Immunity
Governmental immunity exists to protect subdivisions of the State, including
municipalities like the City, from lawsuits and liability for money damages.
Mission Consol. Indep. Sch. Dist. v. Garcia, 253 S.W.3d 653, 655 & n.2 (Tex.
2008); City of Houston v. Vallejo, 371 S.W.3d 499, 502 (Tex. App.—Houston [1st
Dist.] 2012, pet. denied). The doctrine of governmental immunity encompasses
two distinct concepts: (1) immunity from liability, which bars enforcement of a
judgment against a governmental entity, and (2) immunity from suit, which bars
the suit altogether unless the legislature has expressly given consent. Tooke v. City
of Mexia, 197 S.W.3d 325, 332 (Tex. 2006).
Breach of Contract
In its first issue, Edge argues that the trial court erred in granting the City’s
plea to the jurisdiction on its breach-of-contract claim because the Texas
10
Legislature waived the City’s immunity from such suits. See TEX. LOC. GOV’T
CODE ANN. § 271.152.
A governmental entity waives immunity from liability when it contracts with
private citizens, but it does not waive immunity from suit. Tooke v. City of Mexia,
197 S.W.3d 325, 332 (Tex. 2006); Freedman v. Univ. of Houston, 110 S.W.3d 504,
506 (Tex. App.—Houston [1st Dist.] 2003, no pet.). Generally, a party seeking
redress against a governmental unit for breach of contract must establish legislative
consent to sue by bringing suit under a special statute or obtaining a legislative
resolution. See Tooke, 197 S.W.3d at 332; Freedman, 110 S.W.3d at 506–07.
The Local Government Code provides that,
[a] local governmental entity that is authorized by statute or the
constitution to enter into a contract and that enters into a contract
subject to this subchapter waives sovereign immunity to suit for the
purpose of adjudicating a claim for breach of the contract, subject to
the terms and conditions of this subchapter.
TEX. LOC. GOV’T CODE ANN. § 271.152; City of Houston v. Williams, 353 S.W.3d
128, 134 (Tex. 2011) (“[Section 271.152] by clear and unambiguous language
waives a governmental entity’s immunity from suit for breach of written
contract.”).
The parties do not dispute that the City is a governmental entity authorized
to enter into contracts. See Williams, 353 S.W.3d at 135 (determining that City of
Houston is “a local governmental entity . . . that is authorized by statute or the
11
constitution to enter into a contract”). The parties dispute whether they entered
into “a contract subject to this subchapter.” See TEX. LOC. GOV’T CODE ANN.
§.271.152. A “[c]ontract subject to this subchapter” is (1) a written contract, (2)
stating the essential terms of the agreement, (3) for providing goods or services, (4)
to the local governmental entity, (5) that is properly executed on behalf of the local
governmental entity. TEX. LOC. GOV’T CODE ANN. § 271.151(2) (Vernon 2005).
Edge argues that the following documents, taken together, constitute a
contract under section 271.151(2):
1. The City’s August 5, 2005 letter to Edge
2. Edge’s October 29, 2005 letter to the City’s Permit Office
3. Edge’s October 31, 2005 letter to the City
4. The City’s April 30, 2008 certificate of final completion
5. Houston City Council Motion 2008-0698, establishing a pro rata
reimbursement rate for the new line
6. City of Houston Ordinances, sections 47–168 through 47–170
See id. “A court may determine, as a matter of law, that multiple documents
comprise a written contract.” Williams, 353 S.W.3d at 137. “When an ordinance
evidences a contract, and is sought to be enforced as one,” it is construed as any
other contract. Id. Documents and ordinances may be read together as a single
agreement. Id.
We first consider whether the cited documents and ordinances comprise “a
written contract.” TEX. LOC. GOV’T CODE ANN. § 271.151(2). Parties form a
12
binding contract when the following elements are present: (1) an offer, (2) an
acceptance in strict compliance with the terms of the offer, (3) a meeting of the
minds, (4) each party’s consent to the terms, and (5) execution and delivery of the
contract with the intent that it be mutual and binding. Prime Prods., Inc. v. S.S.I.
Plastics, Inc., 97 S.W.3d 631, 636 (Tex. App.—Houston [1st Dist.] 2002, pet.
denied). “‘Meeting of the minds’ describes the mutual understanding and assent to
the agreement regarding the subject matter and the essential terms of the contract.”
Potcinske v. McDonald Prop. Invs., 245 S.W.3d 526, 529–30 (Tex. App.—
Houston [1st Dist.] 2007, no pet.). No particular words are required to create a
contract. Williams, 353 S.W.3d at 137. To be enforceable, however, a contract
must be sufficiently certain to enable a court to determine the rights and
responsibilities of the parties. T.O. Stanley Boot Co. v. Bank of El Paso, 847
S.W.2d 218, 221 (Tex. 1992).
Edge argues that the City’s August 5, 2005 letter constitutes an offer. To
prove a valid offer, a party must show (1) the offeror intended to make an offer; (2)
the terms of the offer were clear and definite; and (3) the offeror communicated the
essential terms of the offer to the offeree. Paciwest v. Warner Alan Props., LLC,
266 S.W.3d 559, 569 (Tex. App.—Fort Worth 2008, pet. denied) (citation
omitted).
13
The City, through its letter, informed Edge that a new wastewater line
extension was necessary, and it directed Edge to have its engineer determine “if the
sanitary sewer extension is feasible and ensure that the sanitary sewer extension
will comply with all City of Houston Specifications and Standards.” The City
noted that if the sewer extension was feasible, “there [were] five (5) options
available” for [Edge’s] proposed construction:
(1) [Edge] may have the line designed and constructed at [its]
expense, with or without the participation of nearby property
owners. If this method is chosen, [Edge] can ask that the City
establish a connection charge for this sewer, whereby any
property owner making a connection to the line would be
required to pay a pro rata share of the cost of constructing the
line; the pro rata share would be based on the area of the property
fronting the privately funded sewer.
(2) [Edge] may enter into an agreement with the City whereby
[Edge] will pay one hundred percent (100%) of the cost to design
the line and the City will assume thirty percent (30%) of the
construction expenses. . . . Changes to Chapter 47 of the Code of
Ordinances . . . allow the City to establish a connection charge
for this sewer, whereby any property owner making connection
to the line would be required to pay a pro-rata share of the
developer’s portion of the cost of constructing the line . . . .
(3) [Edge] may enter into an agreement with the City whereby the
City will pay 100% of the design cost of the line and 70% of
construction costs . . . .
(4) [Edge] may enter into an agreement with the City whereby
[Edge] will pay one hundred percent (100%) of the cost to design
the line and the City will assume fifty percent (50%) of the
construction expenses [with pro-rata reimbursement available].
(5) [Edge’s] request will be placed in a program along with other
similar projects. The City will install the required sanitary sewer
14
line when funds become available. There are no immediate plans
to construct this line.
The City also noted that if it was to participate in the construction of the line, “a
contract between the City and the developer must be approved by Council and
executed by the Mayor.”
The City left open a number of contingencies. It directed Edge to have its
engineer determine “if the sanitary sewer extension [was] feasible,” and it
informed Edge that, if feasible, there were “methods” available for financing the
project. (Emphasis added.) Edge then had to choose among the various methods.
Thus, the terms of any purported offer were not clear and definite. See Paciwest,
266 S.W.3d at 569. The fact that some of the financing methods required that “a
contract between the City and the developer . . . be approved by Council and
executed by the Mayor” demonstrates that the City did not intend to create a
binding agreement through its August, 5, 2005 letter. In addition, the City noted in
its letter that “the owner can ask that the City establish a connection charge for this
sewer.” Thus, the City did not promise to establish such a connection charge.
The City also referenced Chapter 47 of the City’s Code of Ordinances.
Section 47-164, “Construction by Developers under Developer Contract,” states
that “the City may share in the expense of construction” and provides for the cost-
sharing methods listed in the letter. See HOUSTON, TEX., CODE OF ORDINANCES
§.47-164 (2010). Section 47-168 provides specific procedures for a developer to
15
apply to the City for pro-rata reimbursement. Id. § 47–168 (2000). Section 47-170
states, “For a period of 15 years after acceptance by the department of the
completed off-site main, the permittee shall be entitled to reimbursement for
connections from the proceeds of the pro-rata charges established herein.” Id.
§.47-170 (1996). Section 47-170 also provides a semi-annual payment structure.
Id.
Although section 47-170 states, “the permittee shall be entitled to
reimbursement,” section 47-168 shows that there is an application process that
must be undertaken prior to being entitled to reimbursement. Id. § 47-168
(emphasis added). Thus, in its letter, the City could not have promised that Edge
would receive pro-rata reimbursement as there was yet an application process that
Edge was required to undertake after the line was constructed and approved by the
City.
Further, section 47-167 provides, in pertinent part, that “[i]t is intended by
these provisions merely to furnish to the permittee a means of reimbursing himself
from other private persons similarly situated . . . and not in any manner to obligate
the city to pay or cause to be paid any sum of money on account thereof or to vest
in any persons constructing such main any private right against the city of the
public use.” Id. §.47-167 (1996). Thus, the City expressly disclaimed any intent to
be bound.
16
Moreover, nothing in Edge’s certificate of completion or the City Council’s
approval of a pro-rata reimbursement rate evidences an intent to be bound to make
payment.
“A promise, acceptance of which will form a contract, is a manifestation of
intention to act or refrain from acting in a specified way, so made as to justify a
promisee in understanding that a commitment has been made.” Williams, 353
S.W.3d at 138. The documents referred to by Edge, whether read singularly or in
conjunction with one another, do not show that the City intended to be bound to a
specific course of action. Because they do not constitute an offer, Edge’s October
31, 2005 letter cannot operate as an acceptance. And, thus, no contract was
formed.
We conclude that the requirements of section 271.151 were not met and the
waiver of governmental immunity under section 271.152 does not apply.
Accordingly, we hold that the trial court did not err in granting the City’s plea to
the jurisdiction on Edge’s claim for breach of contract.
We overrule Edge’s first issue.
Declaratory Judgment
In its third issue, Edge argues that because it “established the City’s waiver
of immunity from suit under Section 271.152,” the trial court also has jurisdiction
“to entertain Edge’s request for a declaratory judgment.”
17
The Uniform Declaratory Judgment Act (“DJA”) is a “remedial statute
designed ‘to settle and to afford relief from uncertainty and insecurity with respect
to rights, status, and other legal relations.’” Tex. Natural Res. Conservation
Comm’n v. IT-Davy, 74 S.W.3d 849, 855 (Tex. 2002) (quoting TEX. CIV. PRAC. &
REM. CODE § 37.002(b)). A declaratory-judgment suit made against a
governmental unit by a plaintiff seeking to establish a contract’s validity, enforce
performance under a contract, or impose contractual liabilities, cannot be
maintained without legislative permission. See id. at 855–56. Private parties
cannot circumvent immunity from suit by characterizing a suit for money damages,
such as a contract dispute, as a declaratory-judgment claim. See id. at 856.
In its petition, Edge seeks a declaration that
[Edge], pursuant to a valid and enforceable contract and municipal
ordinances, constructed the new line not only for its benefit, but for
the benefit of [the City] and the public, and that [the City] has
breached this contract by denying [Edge’s] request for reimbursement
of a pro-rata share of its construction expenses, and [the City] has
violated [Edge’s] rights under the Constitution of the State of Texas
by taking [Edge’s] personal property without adequate compensation.
Thus, as the City argues, Edge seeks a declaratory judgment in an attempt to
have a determination made on its breach-of-contract claim. See id. at 860. Having
held that Edge did not establish a waiver of immunity on its breach-of-contract
claim, its request for declaratory relief cannot be maintained. See id. Accordingly,
18
we hold that the trial court did not err in granting the City’s plea to the jurisdiction
on Edge’s declaratory-judgment claim.
Accordingly, we overrule Edge’s third issue.
Inverse Condemnation
In its second issue, Edge argues that “the trial court erred in granting the
City’s plea to the jurisdiction because Edge established a valid takings claim.”
Edge asserts that it “was required to build a new wastewater line, which provides a
benefit for the City’s public use and expansion,” and “the City exacted a benefit
from Edge and should be required to compensate Edge for the same.” See Town of
Flower Mound v. Stafford Estates, L.P., 71 S.W.3d 18, 30 (Tex. App.—Fort Worth
2002) (“Flower Mound I”), aff’d, 135 S.W.3d 620 (Tex. 2004) (“Flower Mound
II”) and Sefzik v. City of McKinney, 198 S.W.3d 884, 895 (Tex. App.—Dallas
2006, no pet.).
The Texas Constitution prohibits the State from taking private land for
public use as follows:
No person’s property shall be taken, damaged or destroyed for, or
applied to public use, without adequate compensation being made,
unless by the consent of such person.
TEX. CONST. art. I, § 17. A distinct category of takings occurs when the
government conditions the approval of permits “on an exaction from the approval-
seeking landowner.” Flower Mound I, 71 S.W.3d at 30. Any requirement that a
19
developer provide or do something as a condition to receiving municipal approval
is an exaction. Flower Mound II, 135 S.W.3d at 625.
In Flower Mound I, as a condition of plat approval, the town of Flower
Mound required a landowner to rebuild a road abutting his property at his own
expense in accord with a town ordinance. See Flower Mound II, 135 S.W.3d at
623. The landowner sought an exemption from the ordinance and objected to the
requirement “at every administrative level.” Id. at 624. The town approved the
landowner’s plat and the landowner rebuilt the road and transferred the
improvement to the town. Id. After the town refused to reimburse the landowner
for its proportionate share of the expenses, he sued the town. Id. The town argued
that the landowner had waived his takings claim by failing to sue before the town
approved the plat and by accepting the benefit received in exchange for the
exaction, namely, approval of its plat. Flower Mound I, 71 S.W.3d at 27. On
appeal, the court of appeals rejected the town’s waiver argument, emphasizing that
the landowner “did unsuccessfully object to the [road] improvements condition at
every administrative level within the Town.” Id. at 28. The Texas Supreme Court
likewise rejected the municipality’s argument, noting that the landowner had
objected at every opportunity. Flower Mound II, 135 S.W.3d at 630.
Here, unlike in the Flower Mound cases, Edge alleges in its petition that it
chose to construct the new line at its own expense. Edge attached to its petition the
20
City’s August 5, 2005 letter in which the City informed Edge that, upon
completion, the new wastewater line was to be dedicated to the City “for
ownership and maintenance.” Edge does not allege that it objected at any stage.
By choosing to construct the new line at its own expense and adopting without
objection the City’s requirements, Edge consented to those requirements. See TEX.
CONST. art. I, § 17 (prohibiting taking without compensation or consent).
When, as here, a plaintiff fails to assert facts that constitute a taking,
dismissal of the claim for want of jurisdiction is appropriate. See Gen. Servs.
Comm’n v. Little–Tex Insulation, Co., 39 S.W.3d 591, 599 (Tex. 2001) (dismissing
inverse-condemnation claim for want of jurisdiction because allegations did not
state takings claim). Accordingly, we hold that the trial court did not err in
granting the City’s plea to the jurisdiction on Edge’s inverse-condemnation, or
“takings,” claim.
We overrule Edge’s second issue.
Promissory Estoppel
In its fourth issue, Edge argues that its “promissory estoppel claim is not
barred by immunity” because the City promised Edge reimbursement for
subsequent connections to the new line, Edge relied on this promise when it
constructed the new line at its own expense, and the City “broke its promise” when
21
the Flats connected to the new line and “continues to do so in the case of the Black
Finn Restaurant.”
Absent a clear and unambiguous legislative waiver, the City is immune from
suit in the performance of its governmental functions. Tooke, 297 S.W.3d at 469.
In its plea to the jurisdiction, the City argues that Edge did not plead a legislative
waiver of the City’s immunity from its claim for promissory estoppel and none
exists.
In its response to the City’s plea, Edge asserts that an exception applies.
Specifically, a municipality may be estopped “where justice requires the
application of estoppel and there is no interference with the exercise of its
government functions.” See Maguire Oil Co. v. City of Houston, 69 S.W.3d 350,
366 (Tex. App.—Texarkana 2002, pet. denied). Edge argues that this case presents
such an exception because the City’s failure to honor its promise to reimburse
Edge “constitutes a grave injustice.” Edge did not address in its response below
the matter of interference with the exercise of governmental functions.
The exception is available “only in exceptional cases where the
circumstances clearly demand its application to prevent manifest injustice.” City
of White Settlement v. Super Wash, Inc., 198 S.W.3d 770, 774 (Tex. 2006). In City
of White Settlement, the court stated that it had “applied the exception in only one
circumstance,” namely, where there was evidence that city officials had
22
affirmatively misled the parties seeking to estop the city and the misleading
statements resulted in the permanent loss of the parties’ claims. Id. at 775.
We conclude that Edge does not present an exceptional case in which justice
requires estoppel. Accordingly, we hold that the trial court did not err in granting
the City’s plea to the jurisdiction on Edge’s promissory-estoppel claim.
We overrule Edge’s fourth issue.
Conclusion
We affirm the judgment of the trial court.
Terry Jennings
Justice
Panel consists of Justices Jennings, Higley, and Brown.
23