ACCEPTED NO. 15-25-00134-CV 15-25-00134-CV FIFTEENTH COURT OF APPEALS AUSTIN, TEXAS
In the 10/22/2025 9:12 AM CHRISTOPHER A. PRINE CLERK
Fifteenth Court of Appeals FILED IN 15th COURT OF APPEALS
Austin, Texas AUSTIN, TEXAS 10/22/2025 9:12:51 AM
______________________________________________ CHRISTOPHER A. PRINE Clerk
T EXAS A SSOCIATION OF S CHOOL B OARDS R ISK M ANAGEMENT F UND , Appellant, v. SOUTHWEST TEXAS JUNIOR COLLEGE, Appellee. ______________________________________________ Appeal from the 38th Judicial District Court Uvalde County, Texas, No. 2023-11-35269-CV The Honorable Kelley T. Kimble, Presiding Judge __________________________________________________________________
RESPONSE BRIEF OF CROSS-APPELLEE TEXAS ASSOCIATION OF SCHOOL BOARDS RISK MANAGEMENT FUND __________________________________________________________________
Jack W. Higdon Texas Bar No. 24007360 jack.higdon@blankrome.com Barry Abrams Texas Bar No. 00822700 barry.abrams@blankrome.com Joshua A. Huber Texas Bar No. 24065457 josh.huber@blankrome.com BLANK ROME LLP 717 Texas Avenue, Suite 1400 Houston, Texas 77002-2727 Telephone: (713) 228-6601 Attorneys for Cross-Appellee
ORAL ARGUMENT REQUESTED IDENTITY OF PARTIES AND COUNSEL
PARTIES TO THE TRIAL COURT’S ORDER: CROSS-APPELLANT: Southwest Texas Junior College
CROSS-APPELLEE: Texas Association of School Boards Risk Management Fund TRIAL AND APPELLATE COUNSEL: FOR CROSS-APPELLANTS: Preston J. Dugas III (Trial and Appellate) State Bar No. 24050189 pdugas@dcclawfirm.com Vincent P. Circelli (Trial and Appellate) State Bar No. 24058804 vcircelli@dcclawfirm.com Andrew D. Spadoni (Trial and Appellate) State Bar No. 24109198 aspadoni@dcclawfirm.com Sarah Arroyo (Trial and Appellate) State Bar No. 24138756 sarroyo@dcclawfirm.com DUGAS & CIRCELLI, PLLC 4800 Bryant Irvin Ct., Fort Worth, Texas 76107
FOR CROSS-APPELLEES: Jack W. Higdon (Trial and Appellate) State Bar No. 24007360 jack.higdon@blankrome.com Barry Abrams (Appellate) State Bar No. 00822700 barry.abrams@blankrome.com Joshua A. Huber (Appellate) State Bar No. 24065457 josh.huber@blankrome.com Gregory J. Moore (Trial) State Bar No. 24055999 greg.moore@blankrome.com
i Christopher W. Caudill (Trial) State Bar No. 24104717 christopher.caudill@blankrome.com BLANK ROME LLP 717 Texas Avenue, Suite 1400 Houston, Texas 77002-2727
Clarissa M. Rodriguez (Trial and Appellate) State Bar No. 24056222 cmrodriguez@rampagelaw.com Lori Hanson (Trial) State Bar No. 21128500 lwhanson@rampagelaw.com DENTON NAVARRO RODRIGUEZ BERNAL SANTEE & ZECH, P.C. 2517 N. Main Avenue San Antonio, Texas 78212
ii TABLE OF CONTENTS
Page
IDENTITY OF PARTIES AND COUNSEL............................................... i
STATEMENT REGARDING ORAL ARGUMENT .................................. 1
ABBREVIATIONS AND RECORD REFERENCES ................................ 2
I. STATEMENT OF THE CASE ......................................................... 3
II. ISSUES PRESENTED ..................................................................... 4
III. STATEMENT OF FACTS ................................................................ 5
IV. SUMMARY OF THE ARGUMENT ................................................. 5
V. STANDARD OF REVIEW ............................................................... 7
VI. ARGUMENT .................................................................................... 9
A. THE FUND IS A GOVERNMENTAL ENTITY WITH IMMUNITY FROM SUIT. ............................................................................... 9
B. THE LEGISLATURE GRANTED A LIMITED IMMUNITY WAIVER FOR CLAIMS TO ENFORCE EXPRESS CONTRACT TERMS AND RECOVER DEFINED CATEGORIES OF DAMAGES ........................ 10
C. THE ACT DOES NOT WAIVE THE FUND’S IMMUNITY FROM THE COLLEGE’S CONSEQUENTIAL DAMAGES CLAIM. ................ 11
1. The Legislature Did Not Grant a General Waiver of Immunity for Consequential “Delay Damages” .......... 11
2. The Fund is Not the Property Owner and Therefore Cannot Impose “Owner-Caused” Construction Delays or Acceleration. ................................................ 14
iii VII. PRAYER ......................................................................................... 19
CERFITICATE OF COMPLIANCE ........................................................ 20
CERFITICATE OF SERVICE................................................................. 21
iv TABLE OF AUTHORITIES
Page(s)
Cases
Ben Bolt-Palito Blanco Consol. Indep. Sch. Dist. v. Tex. Political Subdivisions Prop./Cas. Joint Self-Ins. Fund, 212 S.W.3d 320 (Tex. 2006) .................................................................. 9
Tex. Ass’n of Sch. Bds. Risk Mgmt. Fund v. Benavides Indep. Sch. Dist., 221 S.W.3d 732 (Tex. App.—San Antonio 2007, no pet.) ................... 10
Bland Indep. Sch. Dist. v. Blue, 34 S.W.3d 547 (Tex. 2000) ................................................................ 8, 9
City of Corpus Christi v. Graham Construction Services, Inc. No. 13-19-00367-CV, 2020 Tex. App. LEXIS 4734 (Tex. App. - Corpus Christi June 25, 2020, pet. denied) ....................... 17, 18
City of Houston v. Jackson, 192 S.W.3d 764 (Tex. 2006) ............................................................ 8, 14
City of Mesquite v. PKG Contracting, Inc., 263 S.W.3d 444 (Tex. App.—Dallas 2008, pet. denied)...................... 18
City of San Antonio v. Maspero, 640 S.W.3d 523 (Tex. 2022) .................................................................. 9
Cont'l Cas. Ins. Co. v. Functional Restoration Assocs., 19 S.W.3d 393 (Tex. 2000) .................................................................. 12
Cty. of Galveston v. Triple B Servs., LLP, 498 S.W.3d 176 (Tex. App.—Houston [1st Dist.] 2016, pet. denied) ................................................................................................. 14
DART v. Whitley, 104 S.W.3d 540 (Tex. 2003) ............................................................ 7, 10
v Garland Indep. Sch. Dist. v. Reeder Gen. Contractors, Inc., No. 05- 22-00855-CV, 2024 Tex. App. LEXIS 2046 (Tex. App.—Dallas Mar. 21, 2024, pet. denied) .......................................... 18
Green Intern., Inc. v. Solis, 951 S.W.2d 384 (Tex. 1997) (Gonzalez, J., dissenting) ...................... 14
In re Hall, 286 S.W.3d 925 (Tex. 2009) ................................................................ 15
ISI Contracting, Inc. v. Metro. Transit Auth. of Harris Cty., No. 14-24-00119-CV, 2025 Tex. App. LEXIS 5771 (Tex. App.—Houston [14th Dist.] Aug. 5, 2025, no pet. h.)......... 5, 12, 13, 19
Reata Constr. Corp. v. City of Dallas, 197 S.W.3d 371 (Tex. 2006) .................................................................. 8
San Jacinto River Auth. v. City of Conroe, 688 S.W.3d 124 (Tex. 2024) ................................................................ 10
Tex. Dep’t of Parks & Wildlife v. Miranda, 133 S.W.3d 217 (Tex. 2004) .......................................................... 7, 8, 9
Wichita Falls State Hosp. v. Taylor, 106 S.W.3d 692 (Tex. 2003) .................................................................. 8
Zachry Constr. Corp. v. Port of Hous. Auth. of Harris Cty., 449 S.W.3d 98 (Tex. 2014) ................................................ 11, 12, 13, 18
Statutes
Tex. Gov’t. Code § 311.034 ............................................................................................... 8 § 791.001 ............................................................................................... 9 § 2259 .................................................................................................... 9 § 2259.002 ............................................................................................. 9 § 2259.031(a) ......................................................................................... 9
vi Tex. Loc. Gov’t Code § 271.151 ............................................................................................... 5 § 271.151(2)(A) ................................................................................ 5, 11 § 271.152 ..................................................................................... passim § 271.153 ............................................................................. 4, 11, 12, 16 § 271.153(a)(1)............................................................................. passim § 271.153(a)(2)..................................................................................... 16 § 271.153(b)(1)..................................................................................... 13
Other Authorities
House Research Org., Bill Analysis, Tex. H.B. 2039 79th Leg., R.S. (2005) ..................................................................... 6, 15
Senate Research Ctr., Bill Analysis, Tex. H.B. 2039 79th Leg., R.S. (2005) ........................................................................... 7
TEX. R. APP. P. 9.7 ...................................................................................... 5
vii STATEMENT REGARDING ORAL ARGUMENT
Counsel for Cross-Appellee requests oral argument because it may
assist the Court in understanding the procedural aspects of the case
below and afford the members of the Court the opportunity to ask counsel
for Cross-Appellant and Cross-Appellee any questions they may have
about the record and the jurisdictional matters involved.
1 ABBREVIATIONS AND RECORD REFERENCES
Abbreviations
“Fund” refers to Appellant/Cross-Appellee, Texas Association of School Boards Risk Management Fund.
“College” refers to Appellee/Cross-Appellant, Southwest Texas Junior College.
Record References
References to the Clerk’s Record are abbreviated “CR [pg#].”
References to the Supplemental Clerk’s Record are abbreviated “SCR [pg#].”
References to the Reporter’s Record are abbreviated “RR [pg#]:[ln#].”
2 I. STATEMENT OF THE CASE
Nature of the Case: This is an intergovernmental contract dispute. The College seeks replacement cost value benefits under a self-insurance contract between it and other members of the Fund, for property damage allegedly sustained during an April 2021 hailstorm.
Claiming a waiver of the Fund’s governmental immunity from suit and liability under TEX. LOC. GOV’T CODE § 271.152, the College seeks damages for coverage that does not exist under the coverage documents – i.e., replacement cost value benefits for property damage that has not been repaired nor replaced – based upon the equitable theories of waiver and unconscionability, and allegations that the Fund committed fraud and/or acted in bad faith.
Course of Proceedings: The College sued the Fund on November 17, 2023, 1/ and the Fund asserted its governmental immunity from suit in an amended answer and partial plea to the jurisdiction on June 13, 2025 (“Jurisdictional Plea”).2/ The Jurisdictional Plea asserted that no waiver of the Fund’s immunity from suit and liability exists for the College’s: (1) equitable theories of waiver and unconscionability, (2) intentional tort theories of fraud and bad faith, or (3) claims for consequential, exemplary, or treble damages. 3/
1/ CR 5-21. 2/ CR 31-103. 3/ CR 37-43.
3 The College responded to the Jurisdictional Plea on July 18, 2025. 4/ The trial court held an oral hearing on the Jurisdictional Plea on July 21, 2025. 5/
Trial Court Disposition: The Jurisdictional Plea was granted in part and denied in part, on July 30, 2025.6/ The trial court partially granted the Jurisdictional Plea regarding the College’s claims for consequential, exemplary, and treble damages and dismissed those claims with prejudice for lack of subject matter jurisdiction. The trial court partially denied the Jurisdictional Plea regarding the College’s equitable and intentional tort theories.
II. ISSUE PRESENTED
Did the trial court err when it granted the Fund’s Jurisdictional
Plea as it pertained to the College’s claim for consequential damages,
where TEX. LOC. GOV’T CODE § 271.153 specifically does not waive the
Fund’s governmental immunity for consequential damages other than an
“amount owed as compensation for the increased cost to perform the work
as a direct result of owner-caused delays or acceleration.” [Germane to
Cross-Appellant’s Issue 1].
4/ CR 106-123. 5/ CR 104. 6/ CR 137-138.
4 III. STATEMENT OF FACTS
Pursuant to TEX. R. APP. P. 9.7, the Fund adopts and incorporates
by reference the Statement of Facts in the Brief of Appellant filed by the
Fund in this appeal.
IV. SUMMARY OF THE ARGUMENT
TEX. LOC. GOV’T CODE §§ 271.151, et. seq. (the “Act”) created a
narrow immunity waiver to adjudicate claims for breach of the express
terms of government contracts. Id. §§ 271.151(2)(A), 271.152. This
limited immunity waiver is restricted to adjudication awards for defined
types of damages, which the Legislature expressly stated does not
encompass any claim for consequential damages other than “the
increased cost to perform . . . as a direct result of owner-caused delays or
acceleration.” Id. §§ 271.153(a)(1), (b)(1) (emphasis added).
The Fund is immune from the College’s consequential damages
claim because the College, and not the Fund, is the property “owner” in
this case, and the Fund therefore cannot impose “owner-caused”
construction delays or acceleration under any set of facts. ISI
Contracting, Inc. v. Metro. Transit Auth. of Harris Cty., No. 14-24-00119-
5 CV, 2025 Tex. App. LEXIS 5771, at *38-39 (Tex. App.—Houston [14th
Dist.] Aug. 5, 2025, no pet. h.) (“[T]o the extent a breach-of-contract claim
seeks . . . delay damages that are not ‘any amount owed as compensation
for the increased cost to perform the work as a direct result of owner-
caused delays,’ there is no clear and unambiguous waiver of
governmental immunity under the Act.”) (quoting TEX. LOC. GOV’T CODE
§ 271.153(a)(1)) (emphasis added).
The plain and ordinary meaning of the statutory text does not
support the College’s contrary position that the phrase “owner-caused
delays” in the Act does not refer to property “owners.” When the
Legislature authorized a recovery of damages for the “increased cost to
perform the work as a direct result of owner-caused delays or
acceleration,” it did so in the context of contractor plaintiffs who contract
to perform work on government owned property. That construction of the
statute is consistent with the Act’s legislative history, which emphasizes
the Act’s significance to construction contractors. See
also House Research Org., Bill Analysis, Tex. H.B. 2039, 79th Leg., R.S.
(2005) (explaining that proponents of Section 271.152 had argued that it
would “bring fairness to business relationships between contractors and
6 local government entities,” avoid “a fundamentally unfair situation that
denie[d] redress . . . to a contractor who completed a project for a city that
refused to pay,” and address the concerns of contractors who “do not bid
for local government contracts.”); Senate Research Ctr., Bill Analysis,
Tex. H.B. 2039, 79th Leg., R.S. (2005).
By its plain terms, Section 271.153(a)(1), does not apply here
because the Fund is not the “owner” of the relevant properties and the
College did not allege or adduce any jurisdictional evidence that it had
incurred increased costs to perform work as a direct result of its own
“owner-caused” delays or acceleration.
V. STANDARD OF REVIEW
Government entities remain immune from suit and liability except
to the extent the Legislature has expressly waived that immunity. See
DART v. Whitley, 104 S.W.3d 540, 542 (Tex. 2003). Immunity waivers
must be based on the application of a statute and the extent of any waiver
is limited by that statute’s text. Tex. Dep’t of Parks & Wildlife v. Miranda,
133 S.W.3d 217, 226 (Tex. 2004). A plaintiff that sues a governmental
unit must affirmatively demonstrate the court’s jurisdiction by alleging
a statutory immunity waiver. DART, 104 S.W.3d at 542.
7 Because a waiver of governmental immunity “may hamper
governmental functions by requiring tax resources to be used for
defending lawsuits and paying judgments rather than using those
resources for their intended purposes,” the Texas Supreme Court has
instructed that such waivers must be “clearly and unambiguously
stated.” Reata Constr. Corp. v. City of Dallas, 197 S.W.3d 371, 375 (Tex.
2006); see TEX. GOV’T CODE §311.034. Statutes waiving immunity
therefore are “strictly construed,” City of Houston v. Jackson, 192 S.W.3d
764, 770 (Tex. 2006), and courts “generally resolve ambiguities by
retaining immunity.” Wichita Falls State Hosp. v. Taylor, 106 S.W.3d
692, 697 (Tex. 2003).
A plea to the jurisdiction contests a court’s subject matter
jurisdiction to decide all or some of the issues in a case. Bland Indep. Sch.
Dist. v. Blue, 34 S.W.3d 547, 554 (Tex. 2000).The applicable procedural
standard “generally mirrors that of a summary judgment.” Miranda, 133
S.W.3d at 228.
To determine if the plaintiff has met its burden to demonstrate a
viable claim subject to a statutory immunity waiver, a court must
“consider the facts alleged by the plaintiff and, to the extent it is relevant
8 to the jurisdictional issue, the evidence submitted by the parties.” Bland
Indep. Sch. Dist., 34 S.W.3d at 554. To avoid dismissal, plaintiffs “must
raise at least a genuine issue of material fact to overcome the challenge
to the trial court’s subject matter jurisdiction.” Miranda, 133 S.W.3d at
227.
A trial court’s grant or denial of an assertion of governmental
immunity is reviewed de novo. City of San Antonio v. Maspero, 640
S.W.3d 523, 528 (Tex. 2022).
VI. ARGUMENT
A. THE FUND IS A GOVERNMENTAL ENTITY WITH IMMUNITY FROM SUIT.
The Fund is an intergovernmental self-insurance risk pool
operating under the Texas Interlocal Cooperation Act, TEX. GOV’T CODE
§§ 791.001, et seq.; and Chapter 2259 of the Government Code. It was
created by its local governmental members to administer their self
insurance funds, as authorized by the Legislature. Id., § 2259.031(a). In
creating a risk pool, the parties to the interlocal agreement did not waive
the Fund’s immunity, id. § 2259.002, which it enjoys to the same extent
as any other Texas political subdivision. See Ben Bolt-Palito Blanco
Consol. Indep. Sch. Dist. v. Tex. Political Subdivisions Prop./Cas. Joint
9 Self-Ins. Fund, 212 S.W.3d 320, 326 (Tex. 2006); Tex. Ass’n of Sch. Bds.
Risk Mgmt. Fund v. Benavides Indep. Sch. Dist., 221 S.W.3d 732, 737
(Tex. App.—San Antonio 2007, no pet.).
The College therefore cannot proceed with its consequential
damages claim unless it first satisfies its burden to establish a legislative
waiver of the Fund’s immunity with respect to that claim. DART, 104
S.W.3d at 542; San Jacinto River Auth. v. City of Conroe, 688 S.W.3d 124,
133 (Tex. 2024) (“jurisdiction is determined on a claim-by-claim basis”).
B. THE LEGISLATURE GRANTED A LIMITED IMMUNITY WAIVER FOR CLAIMS TO ENFORCE EXPRESS CONTRACT TERMS AND RECOVER DEFINED CATEGORIES OF DAMAGES.
The College alleges that the Legislature waived the Fund’s
immunity through TEX. LOC. GOV’T CODE § 271.152, 7/ which states:
“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.” (emphasis added).
The Act defines the term “contract subject to this subchapter” as “a
written contract stating the essential terms of the agreement for
7/ CR 6.
10 providing goods or services to the local government entity that is properly
executed on behalf of the local governmental entity.” Id., §
271.151(2)(A)(emphasis added).
The scope of the Act’s immunity waiver is further narrowed by
Section 271.153, which expressly excludes the recovery of consequential
damages other than “the increased cost to perform . . . as a direct result
of owner-caused delays or acceleration. Id. §§ 271.153(a)(1), (b)(1)
(emphasis added); Zachry Constr. Corp. v. Port of Hous. Auth. of Harris
Cty., 449 S.W.3d 98, 110 (Tex. 2014) (“Zachry”) (“Section 271.152 uses
Section 271.153 to further define to what extent immunity has been
waived.”).
C. THE ACT DOES NOT WAIVE THE FUND’S IMMUNITY FROM THE COLLEGE’S CONSEQUENTIAL DAMAGES CLAIM.
1. The Legislature Did Not Grant a General Waiver of Immunity for Consequential “Delay Damages.”
The College incorrectly characterizes Section 271.153 as a general
immunity waiver for any claim for consequential “delay damages.” See
College Brief at 12 (“At worst Plaintiff has presented clear evidence that
its pleadings seek delay damages that the Texas legislature has
specifically permitted recovery for.”); 13 (“The Texas legislature included
11 explicit language allowing for the recovery of delay damages under the
Act . . .”). That interpretation would require the Court to excise the
phrase “owner-caused” from Section 271.153(a)(1) altogether. See Cont'l
Cas. Ins. Co. v. Functional Restoration Assocs., 19 S.W.3d 393, 402 (Tex.
2000) (noting that courts must “give effect to all words of a statute, and,
if possible, [ ] not treat any statutory language as mere surplusage.”).
When it adopted the Act, the Legislature confined its consequential
damages immunity waiver to “owner-caused delays.” The Fund is not
“improperly attempt[ing] to narrow the statute” by giving effect to all of
the Legislature’s words. See College Brief at 23. Other courts have
recently correctly read the Act as the Fund does. In ISI Contracting, Inc.
v. Metro. Transit Auth. of Harris Cty., for example, the Fourteenth Court
of Appeals recently analyzed this issue and observed that the Act does
not embody a general waiver of immunity for all alleged delay damages:
In construing these provisions in Zachry, the Supreme Court of Texas concluded that section 271.153 allows recovery of only one type of consequential damages in the adjudication in question— “amount[s] owed as compensation for the increased cost to perform the work as a direct result of owner- caused delays.” See [TEX. LOC. GOV’T CODE] § 271.153; Zachry Constr. Corp., 449 S.W.3d at 110-12. . . . . [G]iven the Supreme Court’s statement that “[d]elay damages are consequential damages,” we conclude that in the context of the Act the Zachry precedent mandates the conclusion that
12 any delay damages other than “amount[s] owed as compensation for the increased cost to perform the work as a direct result of owner-caused delays” are consequential damages disallowed under section 271.153(b)(1). See Zachry Constr. Corp., 449 S.W.3d at 110-12, 114, n.71.
Therefore, to the extent a breach-of-contract claim by [plaintiff] seeks . . . delay damages that are not “any amount owed as compensation for the increased cost to perform the work as a direct result of owner-caused delays,” the trial court did not err by impliedly determining that (1) the clear and unambiguous waiver of governmental immunity under the Act does not apply to the claim[.]
2025 Tex. App. LEXIS 5771, at *37-39 (emphasis added).
The College ultimately concedes that “owner-caused” delays are the
only type of consequential delay damages for which the Legislature has
expressly waived immunity, but maintains that it has pleaded
consequential delay damages that supposedly are “nearly identical to
what the legislature has expressly allowed a claimant to recover in a
breach of contract case against a governmental entity.” See College Brief
at 23 (emphasis added). Use of the telling phrase “nearly identical”
confirms that the College is trying to sidestep the standard applicable
when determining the scope of statutory immunity waivers, which the
Texas Supreme Court has instructed must be “strictly construed.”
Jackson, 192 S.W.3d at 770.
13 2. The Fund is Not the Property Owner and Therefore Cannot Impose “Owner-Caused” Construction Delays or Acceleration.
According to the College, because the phrase “owner-caused delays”
is not defined in the Act, that term does not necessarily mean the owner
of property, and the Fund therefore could be held liable for delay damages
as “the owner of [the Fund’s] risk management programs, including
property coverage.” See College Brief at 25. But the plain and ordinary
meaning of the statutory text does not support the College’s position,
because the term “owner-caused delays” plainly refers to “delay damages”
in the construction context.8/
“‘Delay damages’ is a term of art in the construction industry . . . .”
Green Intern., Inc. v. Solis, 951 S.W.2d 384, 393 (Tex. 1997) (Gonzalez,
J., dissenting). It refers to construction damages “‘arising out of delayed
completion, suspension, acceleration or disrupted performance’; these
damages compensate the contracting party that is injured when a project
8/ In any event, the Fund does not “own” anything, and the College adduced no evidence that the Fund purportedly is “the owner of [the Fund’s] risk management programs, including property coverage.” See College Brief at 25. The Fund is an “administrative agency” created by its governmental entity members, including the College, to perform risk management services and governmental functions relative to the administration of its members’ collective agreement to self-insure against various risks. See CR 56.
14 takes longer than the construction contract specified.” Cty. of Galveston
v. Triple B Servs., LLP, 498 S.W.3d 176, 181 (Tex. App.—Houston [1st
Dist.] 2016, pet. denied) (citing Phillip J. Bruner & Patrick J. O’Connor,
5 Construction Law § 15:29 (2002)). When the Legislature authorized a
recovery of damages for the “increased cost to perform the work as a
direct result of owner-caused delays or acceleration,” it did so in the
context of a contractor plaintiff who is party to a written contract to
perform work on property owned by a defendant local governmental
entity.
That construction of the statute also is consistent with the Act’s
legislative history, which emphasizes the Act’s importance to
construction contractors. See also House Research Org., Bill Analysis,
Tex. H.B. 2039, 79th Leg., R.S. (2005) (explaining that proponents of
Section 271.152 had argued that it would “bring fairness to business
relationships between contractors and local government entities,” avoid
“a fundamentally unfair situation that denie[d] redress . . . to a contractor
who completed a project for a city that refused to pay,” and address the
concerns of contractors who “do not bid for local government contracts.”);
Senate Research Ctr., Bill Analysis, Tex. H.B. 2039, 79th Leg., R.S.
15 (2005).
Moreover, Texas courts “will not give an undefined term a meaning
that is out of harmony or inconsistent with other terms in the statute.”
In re Hall, 286 S.W.3d 925, 929 (Tex. 2009). Where, as here, “a different,
more limited, or precise definition is apparent from the term’s use in the
context of the statute, [courts] apply that meaning.” Id. Other provisions
in the Act confirm that the Legislature used the phrase “owner-caused
delays” in the context of a local government property owner. For example,
the only other category of damages for which a waiver of immunity in
Section 271.153 exists beyond the “amount due and owing under the
contract,” is for amounts owed pursuant to “change orders or additional
work the contractor is directed to perform by a local governmental entity
in connection with the contract.” See TEX. LOC. GOV’T CODE §
271.153(a)(2) (emphasis added). The context in which the Legislature
adopted Sections 271.153(a)(1)-(2) of the Act is self-evident: to allow
construction contractors to recover increased costs to perform a contract
subject to the Act that are caused by a local government property owner’s
delays, acceleration, or change orders.
By its plain terms, Section 271.153(a)(1), does not apply here
16 because the College – not the Fund – is the “owner” of the relevant
properties9/ and the College did not allege or adduce any jurisdictional
evidence that it had incurred increased costs to perform work as a direct
result of its own “owner-caused delays or acceleration.”
The College’s characterization of City of Corpus Christi v. Graham
Construction Services, Inc. as having “rejected a similar argument” is
wrong. See College Brief at 23-25. In Graham Construction Services, Inc.,
the City of Corpus Christi (the “City”) was sued for delay damages
under Section 271.153(a)(1) by a construction contractor hired to build a
waste treatment plant for the City. See No. 13-19-00367-CV, 2020 Tex.
App. LEXIS 4734, at *2-4 (Tex. App.—Corpus Christi June 25, 2020, pet.
denied). The City argued that its immunity was not waived under Section
271.153(a)(1) because the alleged construction delays had been caused by
the City’s independent contractor, Carollo, not by the City-owner itself.
Id. at *7. The Graham Construction court found a jurisdictional fact issue
existed that allowed the claim to proceed because the construction
contract at issue specifically identified the City’s independent contractor,
Carollo, as the “Owner’s Representative.” Id. Thus, whether the alleged
9/ CR 5 (“[The College] owns the property made the basis of this suit . . .”).
17 construction delays had been caused directly by the City-owner, or
indirectly by the City-owner’s contractually designated owner-
representative, the alleged delays were attributable to the City, which
was the owner of the property being constructed.
Graham Construction does not stand for the proposition that a
waiver of immunity exists for delay damages under Section 271.153(a)(1)
in the non-construction context, simply because a plaintiff asserts that
the government defendant “owns” something.
The other authorities the College cites do not support its argument
that the Fund’s immunity has been waived for consequential delay
damages because the Fund is “the owner of [its] risk management
programs, including property coverage.” See College Brief at 25. Every
case the College cites involved claims by construction contractors against
local government property owners. See Zachry, 449 S.W.3d at 101
(“Petitioner, Zachry Construction Corporation, contracted to construct a
wharf on the Bayport Ship Channel for respondent, the Port of Houston
Authority of Harris County, Texas.”); Garland Indep. Sch. Dist. v. Reeder
Gen. Contractors, Inc., No. 05- 22-00855-CV, 2024 Tex. App. LEXIS 2046,
at *2 (Tex. App.—Dallas Mar. 21, 2024, pet. denied) (“Reeder sued the
18 District for breach of contract, alleging the two parties executed a
contract for Reeder to perform construction work at several district
campuses.”); City of Mesquite v. PKG Contracting, Inc., 263 S.W.3d 444,
448 (Tex. App.—Dallas 2008, pet. denied) (“PKG contracted with the City
[of Mesquite] to construct a storm drainage system.”).
Because the College does not seek delay damages that are the
“direct result of owner-caused delays,” the clear and unambiguous
damages immunity waiver in the Act does not apply, and the trial court
properly granted the Fund’s Jurisdictional Plea regarding the College’s
consequential damages claim. ISI Contracting, Inc., 2025 Tex. App.
LEXIS 5771, at *39.
VII. PRAYER
The Fund respectfully prays that the Court affirm the trial court’s
partial grant of the Fund’s Jurisdictional Plea, and grant all other and
further relief to which the Fund may be entitled.
19 Respectfully submitted,
By: /s/ Jack W. Higdon Jack W. Higdon jack.higdon@blankrome.com State Bar No. 24007360 Barry Abrams barry.abrams@blankrome.com State Bar No. 00822700 Joshua A. Huber josh.huber@blankrome.com State Bar No. 24065457 BLANK ROME LLP 717 Texas Avenue, Suite 1400 Houston, Texas 77002-2727 (713) 228-6601 (713) 228-6605 (Fax) ATTORNEYS FOR CROSS-APPELLEE, TEXAS ASSOCIATION OF SCHOOL BOARDS RISK MANAGEMENT FUND
CERTIFICATE OF COMPLIANCE
Pursuant to TEX. R. APP. P. 9.4(i)(3), I certify that this brief complies with the type-volume restrictions of TEX. R. APP. P. 9.4(e), (i)(2)(B). Exclusive of the portions exempted by Rule 9.4(i)(1), this brief contains 2,998 words.
/s/ Jack W. Higdon Jack W. Higdon
20 CERTIFICATE OF SERVICE
I certify pursuant to TEX. R. APP. P. 9.5(b)(1) that a true and correct copy of the foregoing and/or attached instrument was electronically served on counsel for all parties on October 22, 2025, through the Fifteenth District Court of Appeals’ electronic filing manager, as indicated below:
Via Electronic Service: Preston J. Dugas III pdugas@dcclawfirm.com Vincent P. Circelli vcircelli@dcclawfirm.com Andrew D. Spadoni aspadoni@dcclawfirm.com Sarah Arroyo sarroyo@dcclawfirm.com DUGAS & CIRCELLI, PLLC 4800 Bryant Irvin Ct., Fort Worth, Texas 76107
/s/ Jack W. Higdon Jack W. Higdon
21 Automated Certificate of eService This automated certificate of service was created by the efiling system. The filer served this document via email generated by the efiling system on the date and to the persons listed below. The rules governing certificates of service have not changed. Filers must still provide a certificate of service that complies with all applicable rules.
Penny Johnson on behalf of Jack Higdon Bar No. 24007360 pljohnson@blankrome.com Envelope ID: 107137917 Filing Code Description: Brief Requesting Oral Argument Filing Description: Response Brief of Cross-Appellee Texas Association of School Boards Risk Management Fund Status as of 10/22/2025 9:21 AM CST
Associated Case Party: Texas Association of School Boards Risk Management Fund
Name BarNumber Email TimestampSubmitted Status
Barry Abrams barry.abrams@blankrome.com 10/22/2025 9:12:51 AM SENT
Jack Higdon jack.higdon@blankrome.com 10/22/2025 9:12:51 AM SENT
Joshua Huber josh.huber@blankrome.com 10/22/2025 9:12:51 AM SENT
Penny Johnson penny.johnson@blankrome.com 10/22/2025 9:12:51 AM SENT
Liniuse Umunna Liniuse.Umunna@blankrome.com 10/22/2025 9:12:51 AM SENT
Noorhan Chahal noorhan.chahal@blankrome.com 10/22/2025 9:12:51 AM SENT
Clarissa Rodriguez cmrodriguez@rampagelaw.com 10/22/2025 9:12:51 AM SENT
Yvette Manzano yvette.manzano@blankrome.com 10/22/2025 9:12:51 AM SENT
Christopher W.Caudill Christopher.Caudill@BlankRome.com 10/22/2025 9:12:51 AM SENT
Gregory J.Moore Greg.Moore@BlankRome.com 10/22/2025 9:12:51 AM SENT
Associated Case Party: Southwest Texas Junior College
Name BarNumber Email TimestampSubmitted Status
Amy Easley aeasley@dcclawfirm.com 10/22/2025 9:12:51 AM SENT
Preston J.Dugas III pdugas@dcclawfirm.com 10/22/2025 9:12:51 AM SENT
Vincent P. Circelli vcircelli@dcclawfirm.com 10/22/2025 9:12:51 AM SENT
Andrew D. Spadoni aspadoni@dcclawfirm.com 10/22/2025 9:12:51 AM SENT
Sarah Arroyo sarroyo@dcclawfirm.com 10/22/2025 9:12:51 AM SENT