Hertz Corp. v. State Department of Highways & Public Transportation

728 S.W.2d 917, 1987 Tex. App. LEXIS 7324
CourtCourt of Appeals of Texas
DecidedApril 15, 1987
Docket3-86-009-CV
StatusPublished
Cited by11 cases

This text of 728 S.W.2d 917 (Hertz Corp. v. State Department of Highways & Public Transportation) is published on Counsel Stack Legal Research, covering Court of Appeals of Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Hertz Corp. v. State Department of Highways & Public Transportation, 728 S.W.2d 917, 1987 Tex. App. LEXIS 7324 (Tex. Ct. App. 1987).

Opinion

SHANNON, Chief Justice.

Appellants Hertz Corporation, Budget Rent-A-Car Systems, Inc., and National Car Systems, Inc., filed a declaratory judgment suit in the district court of Travis County pursuant to Tex.Rev.Civ.Stat.Ann. art. 6252-13a, § 12 and Tex.Civ.Prac. and Rem. Code § 37.001, et seq. By their suit appellants sought a declaration concerning the validity and applicability of certain rules promulgated by appellee Department of Highways and Public Transportation relating to “off-site” sales of used automobiles. Ancillary to their declaratory judgment suit, appellants sought a temporary injunction, in effect, prohibiting the Department from enforcing its rules with respect to appellants’ “off-site” sales.

After hearing, the district court rendered judgment denying appellants’ application for a temporary injunction. Appellants have perfected an appeal from that judgment. This Court will affirm the judgment of the district court.

For several years before September 1, 1985, appellants had conducted “off-site” sales of cars which had once been in their rent-car fleets. These sales were conducted away from the permanent place of business of the rent-car company, frequently at temporary locations such as hotel or shopping center parking lots or drive-in movie lots. The “off-site” sales were often sponsored by credit unions which would promote the sales to their members and provide pre-arranged credit for the purchase of the used cars.

Effective September 1, 1985, the Legislature amended Tex.Rev.Civ.Stat.Ann. art. 6686(a)(1) (Supp.1987). Article 6686 governs dealer’s and manufacturer’s license plates and tags for motor vehicles and other vehicles. As described by appellants, the “heart” of the amendment is found in art. 6686(a) (1-A)(v) and provides as follows:

Except as otherwise provided by law or regulation of the Department, a dealer holding a general distinguishing number for a particular type of vehicle may oper *919 ate thereunder from more than one location within the limits of a city, but a separate and distinct general distinguishing number supported by the affirmations and accompanied by the fees required herein, shall be required for any other location. (Emphasis added).

As this Court understands, each appellant, prior to the amendment, held a “general distinguishing number” as required by the statute and, presumably, each continues to hold such number. Since the amendment, itself, did not expressly describe what types of “locations” dealers could operate from, the question arose whether or not appellants, and those similarly situated, could continue to conduct “off-site” sales of their used automobiles.

After notice and hearing in January 1986, the agency 1 charged with enforcement promulgated rules in connection with the amended statute. The rules which are the center of the controversy are set out as follows:

§ 17.63. More Than One Location. A dealer holding a general distinguishing number for a particular type of vehicle may operate from more than one location within the limits of a city, provided each such location meets the requirements of an established and permanent place of business and is approved by the department.
§ 17.64. Off-site Sales. Unless otherwise authorized by statute, a dealer is not permitted under Texas Civil Statutes, Article 6686, to sell or offer for sale vehicles from a location other than an established and permanent place of business which has been approved by the department.

(emphasis supplied).

By their suit, appellants sought, among other things, a declaration from the district court that the agency rule-making proceeding failed to comply with the rule-making procedures of the Administrative Procedure and Texas Register Act, Tex.Rev.Civ. Stat-Ann. art. 6252-13a, § 5(c-l); that the agency’s rules were in conflict with art. 6686, as amended; and that the agency refused to exercise its duty under art. 6686 to promulgate rules establishing the rights and conditions under which dealers conduct “off-site” sales.

Ancillary to their suit for declaratory judgment, appellants sought a temporary injunction prohibiting the agency from enforcing its new rules or from preventing appellants from conducting “off-site” sales.

After hearing, the district court refused to temporarily enjoin the agency from enforcing its rules. It is from the district court’s order refusing the application for a temporary injunction that appellants have perfected their appeal.

Appellants assail the district court’s order by eleven points of error, the first ten of which are directed to the district court’s refusal to render a declaratory judgment on those issues in controversy. The district court’s hearing, and its order, addressed only appellants’ application for temporary injunctive relief from enforcement of the agency’s rules pending a final disposition of the declaratory judgment suit on the merits.

The district court properly considered only appellants’ application for temporary injunctive relief because the merits of the underlying declaratory judgment suit were not in issue. Likewise, in an appeal from an order denying (or granting) an application for a temporary injunction, appellate review is confined to the validity of the order denying (or granting) the in-junctive relief and the merits of the underlying lawsuit are not presented for review. Davis v. Huey, 571 S.W.2d 859 (Tex.1978). Indeed, appellate consideration of the merits of the underlying lawsuit in an appeal of a temporary order is error. Id.

In their eleventh point of error, appellants complain that the district court erred in denying their application for a temporary injunction. In a hearing on an application for a temporary injunction, the only question before the trial court is the appellant’s right to the preservation of the status quo of the subject matter of the *920 suit, pending a final trial on the merits. To warrant the issuance of a temporary injunction, the applicant need only show a probable right and a probable injury; he is not required to establish that he will finally prevail in the litigation. The trial court is clothed with broad discretion in determining whether the pleadings and evidence present a case of probable right and probable injury. The trial court’s order in issuing or denying the writ of injunction will be reversed only on a showing of a clear abuse of discretion. Transport Co. of Texas v. Robertson Transports, 152 Tex. 551, 261 S.W.2d 549 (1953).

The parties’ dispute is focused upon the existence vel non of appellants’ probable right to a judgment declaring the agency rules invalid. Appellants suggest, first, that the rules are invalid because the agency failed to “substantially” comply with the rule-making procedures of Tex.Rev.Civ. Stat.Ann. art. 6252-13a, § 5. “Substantial compliance” with rule-making procedure is mandated by § 5(e).

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Bluebook (online)
728 S.W.2d 917, 1987 Tex. App. LEXIS 7324, Counsel Stack Legal Research, https://law.counselstack.com/opinion/hertz-corp-v-state-department-of-highways-public-transportation-texapp-1987.