Star Houston, Inc. v. Texas Department of Transportation, Motor Vehicle Division

957 S.W.2d 102, 1997 Tex. App. LEXIS 5405, 1997 WL 633741
CourtCourt of Appeals of Texas
DecidedOctober 16, 1997
Docket03-96-00676-CV
StatusPublished
Cited by36 cases

This text of 957 S.W.2d 102 (Star Houston, Inc. v. Texas Department of Transportation, Motor Vehicle Division) 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
Star Houston, Inc. v. Texas Department of Transportation, Motor Vehicle Division, 957 S.W.2d 102, 1997 Tex. App. LEXIS 5405, 1997 WL 633741 (Tex. Ct. App. 1997).

Opinion

CARROLL, Justice.

This case arises out of the termination of appellant Star Houston’s franchise and the revocation of its license to sell Saab vehicles in Houston, Texas. Star brought an administrative appeal of an order of the Texas Department of Transportation, Motor Vehicle Division (“the Commission”) 1 that allowed appellee Saab Cars U.S.A., Inc. to terminate its franchise agreement with Star. Star also brought several declaratory judgment claims against the Commission. The trial court dismissed the declaratory judgment claims and affirmed the Commission’s order. Star appeals by ten points of error. We will modify the dismissal and affirm the judgment of the district court as modified.

BACKGROUND

Star is a car dealership in Houston, Texas, that entered into a franchise agreement with Saab Cars U.S.A., Inc., to sell Saab vehicles. Star also entered into agreements with other car manufacturers to sell other makes of cars. Star had Texas licenses to operate its franchises under the agreements. See Tex. Rev.Civ. Stat. Ann. art. 4413(36), § 4.01(a) (West Supp.1997) (“Texas Motor Vehicle Commission Code” or “TMVC Code”).

Pursuant to its franchise agreements, Star purchased and displayed signs on its property to advertise the cars it had for sale. In 1993, Saab approached Star with a new sign package and asked Star to purchase and display the new signs. According to Saab, the new signs were necessary to successfully market its new 900 models, which were scheduled to debut coincident with the display of the new signs. Star declined to purchase the new signs for various reasons, including that the Houston sign ordinance would not permit display of the new signs along with the signs Star already displayed for its other franchises. After failed attempts to negotiate, Saab notified Star that it intended to terminate its franchise.

The TMVC Code allows dealers threatened with franchise termination to protest termination before the Commission. See TMVC Code § 5.02(b)(3) (West Supp.1997). If a dealer protests timely, the manufacturer may not terminate the franchise until the Commission determines good cause exists to do so. See id. § 5.02(b)(3)(iv). Star protested Saab’s threatened franchise termination and a hearing examiner conducted an evidentiary hearing. The hearing examiner then issued a proposal for decision determining that Saab had good cause to terminate Star’s franchise.

On May 18, 1995, the Commission convened in open session to discuss the examiner’s proposal. The Commission did not adopt the proposal but orally ordered the *105 parties to mediate their dispute before June 30, 1995. The Commission did not reduce the order to writing until after the June deadline had passed. The parties did not mediate their dispute and the Commission did not attempt to force them to mediate.

The Commission reconvened in open session on September 7, 1995, to consider the ease. The Commission withdrew its prior order to mediate, reopened the evidentiary record to allow Star to admit additional evidence, and then adopted the examiner’s proposal for decision. Shortly thereafter, the Commission revoked Star’s license to operate as a Saab dealer. The Commission did not send another notice or conduct another hearing before revoking the license.

Star sought judicial review of the Commission’s final order in district court pursuant to the Administrative Procedure Act (“APA”). See Tex. Gov’t Code Ann. §§ 2001.171, .174 (West Supp.1997). Star also challenged the order and the license revocation by seeking a declaratory judgment pursuant to the APA and the Uniform Declaratory Judgments Act (“UDJA”). See APA § 2001.038 (West Supp. 1997); Tex. Civ. Prac. & Rem.Code Ann. §§ 37.001-.011 (West 1997). The Commission filed a plea in abatement, arguing sovereign immunity barred Star’s declaratory judgment claims. The district court dismissed the declaratory judgment actions with prejudice. The court later affirmed the Commission’s order allowing Saab to terminate Star’s franchise.

Star challenges the district court’s order of dismissal and judgment in ten points of error. Star primarily argues: (1) the Commission erred in failing to enforce the May 18 order; (2) the September 7 order is invalid because of voting improprieties; (3) the September 7 order is not supported by substantial evidence; (4) the Commission violated the TMVC Code by promulgating the September 7 order; (5) Star did not receive adequate notice of the subject of the Commission proceedings; and (6) the district court erred in dismissing Star’s declaratory judgment claim concerning the revocation of its license without additional notice and hearing.

DISCUSSION

Finality of the May 18 order

In point of error four, Star contends the Commission erred in failing to enforce the May 18 oral order because it was unchallenged and final. Star further contends the finality of the May 18 order divested the Commission of jurisdiction to enter the September 7 order. Star’s entire argument is based on the premise that the May 18 oral pronouncement was final within the meaning of the APA and the TMVC Code.

Neither the APA nor the TMVC Code defines a “final order.” The APA merely explains when an agency’s ultimate decision in a case becomes final; it does not explain what constitutes an ultimate decision. See APA § 2001.144. The APA does require final decisions to be reduced to writing or to be stated on the record. See APA § 2001.141 (West Supp.1997). Similarly, the TMVC Code requires the Commission to take actions “conducive to the issuance of a final order” and to “thereafter issue a written final decision or order” but the TMVC Code does not define the meaning of “final order.” See TMVC Code § 3.08(g) (West Supp.1997). Star interprets these provisions as meaning every agency order written or stated on the record is a final order. This interpretation is not supported by the statutes. Nor does it comport with established caselaw.

According to the supreme court, a final agency order is one: (1) that is definitive, (2) promulgated in a formal manner, (3) with which the agency expects compliance, and (4) that fixes some legal relationship as a consummation of the administrative process. See Texas-New Mexico Power v. Texas Indus. Energy Consumers, 806 S.W.2d 230, 232 (Tex.1991) (emphasis added). A “final order” is not necessarily the last order issued in an administrative proceeding. See State v. Public Util. Comm’n, 840 S.W.2d 650, 654 (Tex.App.—Austin 1992), rev’d in part on other grounds, 883 S.W.2d 190 (Tex.1994). However, so long as matters remain open, unfinished, or inconclusive, there is no final decision. Id. For example, an order that requires subsequent agency approval is not final. North Alamo Water Supply Corp. *106 v.

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957 S.W.2d 102, 1997 Tex. App. LEXIS 5405, 1997 WL 633741, Counsel Stack Legal Research, https://law.counselstack.com/opinion/star-houston-inc-v-texas-department-of-transportation-motor-vehicle-texapp-1997.