Creekstone Community Association, Inc. v. Houston Housing Authority, Individually and D/B/A/ Housing Authority of the City of Houston

• Court: Court of Appeals of Texas
• Decided: December 16, 2010
• Docket: 01-09-00984-CV
• Status: Published

Opinion

Opinion issued December 16, 2010

In The

Court of Appeals

For The

First District of Texas

————————————

NO. 01-09-00984-CV

———————————

Creekstone Community Assn., Inc., Appellant

V.

Houston Housing Authority, Individually and DBA Housing Authority of the City of Houston, Appellee

On Appeal from the 127th District Court

Harris County, Texas

Trial Court Case No. 2007-75007

MEMORANDUM OPINION

          Appellant, the Creekstone Community Association (“Creekstone”), appeals the trial court’s interlocutory order granting the Houston Housing Authority’s (“the Authority”) plea to the jurisdiction.  See Tex. Civ. Prac. & Rem. Code § 51.014(a)(8).  In its sole issue, Creekstone contends the trial court erred in granting the Authority’s plea to the jurisdiction.

          We affirm.

BACKGROUND

The Authority is a governmental entity organized pursuant to Chapter 392 of the Texas Local Government Code.[1]  In September 1988, the Authority purchased real property (“the property”) from the United States Department of Housing and Urban Development (“HUD”).  The property is the subject of this suit and is located in Katy, Texas in the Creekstone Section One Subdivision (“the Subdivision”).  Creekstone is the homeowners’ association that governs the Subdivision.

In December 2007, Creekstone brought suit against the Authority seeking permanent injunctive relief.  In its petition, Creekstone alleged that the property was subject to particular covenants outlined in a Declaration of Covenants filed at the Property Records of Harris County.  It alleged that when the Authority bought the property, it executed a special warranty deed that stated the Authority took the property “subject to and as affected by [ ] all covenants, easements, restrictions, conditions and rights appearing in the record.”  It further alleged that the Authority had failed to maintain the property in accordance with these covenants and that it had, therefore, breached the Declaration of Covenants.  In addition to permanent injunctive relief, Creekstone sought attorney’s fees and costs of court, civil damages pursuant to section 202.004(c) of the Texas Property Code,[2] and post judgment interest. 

The Authority responded to Creekstone by asserting the affirmative defense of governmental immunity in its First Amended Original Answer and Affirmative Defenses.  The Authority filed a plea to the jurisdiction asserting that the trial court lacked subject-matter jurisdiction to adjudicate Creekstone’s claims because it had governmental immunity from suit and liability.  It further asserted that Creekstone had failed to identify a statutory waiver of the Authority’s immunity from suit that would vest the trial court with subject-matter jurisdiction.

On April 30, 2009, the trial court held an oral hearing regarding the Authority’s plea to the jurisdiction.  During the oral hearing, the trial court ordered Creekstone to file a response to the Authority’s plea by close of business on May 12, 2009.  Creekstone did not respond by May 12, and on May 13, the trial court granted the Authority’s plea to the jurisdiction, dismissing the case in its entirety for lack of subject-matter jurisdiction.  Creekstone subsequently filed its response to the Authority’s plea on May 14. 

Creekstone filed a motion for new trial.  It asserted the trial court should grant a new trial because there was no evidence before the trial court to demonstrate that the Authority was a governmental entity and Creekstone had not been given an opportunity to amend its petition so it could plead and prove waiver of immunity.  The trial court granted Creekstone’s motion for new trial and withdrew its May 13 order.

The trial court then reconsidered Creekstone’s response to the Authority’s plea to the jurisdiction.  In Creekstone’s response, it asserted that its own pleadings did not provide a basis for concluding that the Authority was a governmental entity.  Next, it asserted that chapter 271 of the Texas Government Code provided an explicit waiver of governmental immunity for governmental entities that entered into contracts for services, and that, even if the Authority was a governmental entity, it had waived immunity from suit by executing the special warranty deed that it contended was a contract for services. 

On July 27th, the trial court again granted the Authority’s plea to the jurisdiction and dismissed Creekstone’s suit for lack of subject-matter jurisdiction.  The Order made the following findings of fact and conclusions of law:

(1)     As demonstrated by [the Authority’s] affidavit and by the Court taking judicial notice, [the Authority] is a governmental entity organized pursuant to Chapter 392 of the Texas Local Government Code.

(2)     Governmental immunity protects [the Authority] from suit and liability unless immunity has been waived by clear and unambiguous statutory language.

(3)     The limited waiver of immunity from suit contained in Section 271.152 of the Texas Local Government Code does not apply to [the Authority’s] purchase of the real property at issue by special warranty deed.

(4)     [Creekstone] and [the Authority] did not enter into a contract as that term is defined by Section 271.151(2) of the Texas Local Government Code; thus, the limited waiver of immunity from suit contained in Section 271.152 of the Texas Local Government Code does not apply.

(5)     A restrictive covenant is not a contract as that term is defined by Section 271.151(2) of the Texas Local Government code; thus, the limited waiver of immunity from suit contained in Section 271.152 of the Texas Local Government code does not apply to [Creekstone’s] Declaration of Covenants, Conditions and Restrictions (the restrictive covenants).

(6)     [The Authority] did not waive its immunity to suit and liability for any of [Creekstone’s] claims.

(7)     This Court is without subject-matter jurisdiction to adjudicate any of [Creekstone’s] claims against [the Authority].

After the trial court signed its order, Creekstone filed a second motion for new trial.  Creekstone’s second motion for new trial was overruled by operation of law.

THE AUTHORITY’S PLEA TO THE JURISDICTION

On appeal, Creekstone does not raise a point of error regarding the trial court’s order.  However, the rules of appellate procedure and applicable case law require us to construe briefing rules liberally.  See Republic Underwriters Ins. Co. v. Mex-Tex, Inc., 150 S.W.3d 423, 427 (Tex. 2004); see also Tex. R. App. P. 38.9.  Although not assigned as a specific issue, Creekstone raised in its brief the contention that the “[Authority] is not entitled to immunity from suit with regard to [its] claims.”   We interpret Creekstone’s argument as contending the trial court erred in granting the Authority’s plea to the jurisdiction because it was not entitled to immunity from suit with regard to Creekstone’s claims.

A.      Standard of Review

Subject-matter jurisdiction is an essential prerequisite to a court’s authority to resolve a suit.  See Tex. Dep’t of Transp. v. Jones, 8 S.W.3d 636, 637 (Tex. 1999).  In a suit against a governmental entity, it is the plaintiff’s burden to affirmatively demonstrate the court’s subject-matter jurisdiction by alleging a valid waiver of immunity.  DART v. Whitley, 104 S.W.3d 540, 542 (Tex. 2003).  Unless a plaintiff meets his burden of establishing the court’s jurisdiction, the court is without power to hear a case.  See id. at 543, 544. 

Governmental immunity from suit is properly asserted in a plea to the jurisdiction.  See Tex. Dep’t of Parks & Wildlife v. Miranda, 133 S.W.3d 217, 225–26 (Tex. 2004).  In filing a plea to the jurisdiction, a litigant challenges the trial court’s subject-matter jurisdiction.  Bland Indep. Sch. Dist. v. Blue, 34 S.W.3d 547, 554 (Tex. 2000).  In order to prevail, the party asserting the plea must show that, even if all the allegations in the plaintiff’s pleadings are taken as true, there is an incurable jurisdictional defect apparent from the face of the pleadings, rendering it impossible for the plaintiff’s petition to confer jurisdiction on the trial court.  Rylander v. Caldwell, 23 S.W.3d 132, 135 (Tex. App.—Austin 2000, no pet.).   

Because subject-matter jurisdiction is a question of law, we conduct a de novo review of the trial court’s ruling on the plea.  See Mayhew v. Town of Sunnyvale, 964 S.W.2d 922, 928 (Tex. 1998).  Upon review, we consider the pleadings and the evidence pertinent to the jurisdictional inquiry.  County of Cameron v. Brown, 80 S.W.3d 549, 555 (Tex. 2002).  We do not consider the merits of the case; our jurisdiction is limited to reviewing the grant or denial of the plea to the jurisdiction that was filed.  Id.; see also Tex. Civ. Prac. & Rem. Code Ann. § 51.014(a)(8) (Vernon Supp. 2010); First Trade Union Sav. Bank, 133 S.W.3d at 686–87; Brenham Hous. Auth. v. Davies, 158 S.W.3d 53, 61 (Tex. App.—Houston [14th Dist.] 2005, no pet.).  We do not have jurisdiction to consider grounds outside those raised in the plea to the jurisdiction.  First Trade Union Sav. Bank, 133 S.W.3d at 687; Davies, 158 S.W.3d at 61.

B.      Immunity

          Governmental immunity has two components: immunity from suit and immunity from liability.  Tooke v. City of Mexia, 197 S.W.3d 325, 332 (Tex. 2006).  Immunity from suit bars suit against a government entity altogether.  Id.  When a political subdivision of the state is immune from suit under the doctrine of governmental immunity, a court lacks subject-matter jurisdiction over the suit.  Tex. Dep’t of Transp., 8 S.W.3d at 638.  Immunity from suit can be waived only by statute or legislative resolution.  Federal Sign v. Tex. So. Univ., 951 S.W.2d 401, 405 (Tex. 1997). 

Immunity from liability protects government agencies and officials from judgment even if immunity from suit has been waived.  Tex. Dep’t of Transp., 8 S.W.3d at 638.  A governmental unit waives its immunity from liability when it contracts with a private citizen.  See Federal Sign, 951 S.W.2d at 408. 

C.      Statutory Interpretation

We review the trial court’s interpretation of applicable statutes de novo.  See Johnson v. City of Fort Worth, 774 S.W.2d 653, 655–56 (Tex. 1989).  In our review, we look to pertinent legislative enactments to determine the extent to which immunity has been voluntarily relinquished.  See Mission Consol. Indep. Sch. Dist. v. Garcia, 253 S.W.3d 653, 655 (Tex. 2008).  We interpret statutory waivers of immunity narrowly, as the Legislature’s intent to waive immunity must be clear and unambiguous.  Id.; see also Tex. Gov’t Code Ann. § 311.034 (Vernon Supp. 2010) (“[A] statute shall not be construed as a waiver of sovereign immunity unless the waiver is effected by clear and unambiguous language.”).  Use of words like “sue and be sued,” as found in statutes such as section 392.065(1) of the Local Government Code, are not words in and of themselves that waive immunity from suit.  See Tooke, 197 S.W.3d at 328–29; see also Tex. Loc. Gov’t Code Ann. § 392.065(1) (Vernon 2005) (“A[] [housing] authority may: (1) sue and be sued.”).                                                                                                                     

In construing a statute, our objective is 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).  If possible, we must ascertain that intent from language the Legislature used in the statute and not look to extraneous matters for an intent the statute does not state.  Id.  If the meaning of the statutory language is unambiguous, we adopt the interpretation supported by the plain meaning of the provision’s words.  St. Luke’s Episcopal Hosp. v. Agbor, 952 S.W.2d 503, 505 (Tex. 1997).  We must not engage in a forced or strained construction; instead, we must yield to the plain sense of the words the Legislature chose.  See id.

D.      Analysis

In its Original Petition for Permanent Injunction, Creekstone asserted that the Authority had substantially breached the Declaration of Covenants.  In its response to the Authority’s plea to the jurisdiction, Creekstone also asserted the Authority had waived immunity because it “entered into written contracts pursuant to the authority of Chapter 271 in the form of both the Special Warranty Deed and the Declaration [of Covenants].” 

 Section 271.152 of the Texas Local Government Code provides for a limited waiver of immunity from suit as to certain contract claims:

A local government 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 purposes of adjudicating a claim for breach of contract, subject to the terms and conditions of this subchapter.

Tex. Loc. Gov. Code Ann. § 271.152 (Vernon 2005).  For the entity to waive immunity from suit as to contract claims under section 271.152, the following statutory criteria must be satisfied: 

(1) the entity must be “[a] local governmental entity that is authorized by statute or the constitution to enter into a contract.”

(2) The entity must enter into a “contract subject to this subchapter.”

(3) The claim must be for breach of the contract and be asserted in a civil suit in “county or state court” or in an “authorized arbitration proceeding” in accordance with any “mandatory procedures established in the contract . . . for the arbitration proceedings.”

See id. § 271.152; Clear Lake City Water Auth. v. Friendswood Dev. Co., 256 S.W.3d 735, 746 (Tex. App.—Houston [14th Dist.] 2008, pet. dism’d).  The term “contract subject to this subchapter” means:

[A] written contract stating the essential terms of the agreement for providing goods or services to the local governmental entity that is properly executed on behalf of the local governmental entity.

See id. § 271.151(2) (Vernon 2005). 

          Assuming the first and third criteria of section 271.152 are satisfied, Creekstone has still failed to meet the second criterion because neither the Declaration of Covenants nor the Special Warranty Deed qualifies under section 271.151(2) as a written contract related to the provision of goods and services.  See id. §§ 271.151(2), 271.152; Hoppenstein Props., Inc. v. McLennan County Appraisal Dist., No. 10-09-00426-CV, 2010 WL 3272404, at *2 (Tex. App.—Waco Aug. 18, 2010, no pet.) (mem. op.) (“A contract that involves an interest in property, alone, is not an agreement to provide goods or services to a governmental entity.”); City of San Antonio v. Reed S. Lehman Grain, Ltd., No. 04-04-00930-CV, 2007 WL 274071, at *2 n.2 (Tex. App.—San Antonio Jan. 31, 2007, pet. denied) (mem. op.) (noting that easement dedication contract conveyed only interest in real property and was not agreement for providing goods and services).  Because Creekstone did not bring an action that provided a limited waiver of immunity from suit pursuant to section 271.152, we conclude the trial court correctly granted the Authority’s plea to the jurisdiction.  See Ben Bolt-Palito Blanco Consol. Indep. Sch. Dist. v. Tex. Political Subdivisions Prop./Casualty Joint Self-Ins. Fund, 212 S.W.3d 320, 327 (Tex. 2006) (stating that, for there to be waiver of immunity under section 271.152, suit must be for breach of “a written contract stating the essential terms of the agreement for providing goods or services to the local governmental entity that is properly executed on behalf of the local governmental entity”).

          Creekstone also makes the assertions that (1) it may obtain injunctive relief against the Authority because it seeks to enforce restrictive covenants and not monetary damages, (2) the Authority is not immune from suit because the Authority is not involved in a governmental function, (3) the Authority waived immunity through its conduct.  The record does not reflect that Creekstone raised these arguments in the trial court.  It has, therefore, failed to preserve these issues for our review.  See Tex. R. App. P. 33.1; see also Dreyer v. Greene, 871 S.W.2d 697, 698 (Tex. 1993) (“As a rule, a claim, including a constitutional claim, must have been asserted in the trial court in order to be raised on appeal.”); Holcombe v. Reeves County Appraisal Dist., 310 S.W.3d 86, 90 (Tex. App.—El Paso 2010, no pet.) (“It is well settled that a party will not be permitted to take a position on appeal that is not presented in the trial court.”).

          We overrule Creekstone’s sole issue on appeal.

RULE 45 SANCTIONS

          In its brief, the Authority contends that Creekstone’s appeal is frivolous and requests monetary damages.  Rule 45 of the Texas Rules of Appellate Procedure permits an appellate court to award a prevailing party “just damages” for a “frivolous” appeal.  Tex. R. App. P. 45; Smith v. Brown, 51 S.W.3d 376, 380 (Tex. App.—Houston [1st Dist.] 2001, pet. denied).  In determining whether an appeal is frivolous, we apply an objective test.  Smith, 51 S.W.3d at 381.  We review the record from the viewpoint of the advocate and ask whether the advocate had reasonable grounds to believe the judgment could be reversed.  Id.  We exercise prudence and caution and deliberate most carefully before awarding appellate sanctions.  Id.

          After reviewing the record and the arguments presented by the parties to the trial court and in their appellate briefs, we hold that Creekstone’s appeal is not frivolous.  We, therefore, deny the Authority’s request for sanctions.

CONCLUSION

          We affirm the judgment of the trial court.

                                                                   Sherry Radack

                                                                   Chief Justice

Panel consists of Chief Justice Radack and Justices Massengale and Matthews.[3]

---

[1]           See Tex. Loc. Gov’t Code Ann. § 392.006 (Vernon Supp. 2010).

[2]           See Tex. Prop. Code Ann. § 202.004(c) (Vernon 2007) (“A court may assess civil damages for the violation of a restrictive covenant in an amount not to exceed $200 for each day of the violation.”).

[3]           The Honorable Sylvia Matthews, Judge of the 281st District Court of Harris

County, participating by assignment.