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At a Glance:
Title:
Bexar Metropolitan Water Dist. v. City of Bulverde
Date:
November 18, 2004
Citation:
156 S.W.3d 79
Status:
Published Opinion

Bexar Metropolitan Water Dist. v. City of Bulverde

Court of Appeals of Texas,

Austin.

BEXAR METROPOLITAN WATER DISTRICT, Appellant,

v.

CITY OF BULVERDE, Texas; Guadalupe–Blanco River Authority; City of Boerne; and City of Fair Oaks Ranch, Appellees.

No. 03–04–00367–CV.

|

Nov. 18, 2004.

|

Rehearing Overruled Jan. 12, 2005.

Attorneys & Firms

*82 E. Lee Parsley, E. Lee Parsley, P.C., Austin, for Appellant.

Jonathan H. Hull, Reagan, Burrus, Dierksen, Lamon & Bluntzer, P.C., New Braunfels, for City of Boerne and City of Fair Oaks Ranch.

Roger P. Nevola, Law Offices of Roger P. Nevola, Austin, for Guadalupe–Blanco River Authority.

Frank J. Garza, Davidson & Troilo, P.C., San Antonio, for City of Bulverde, Texas.

Before Justices PURYEAR.

OPINION

MACK KIDD, Justice.

The City of Bulverde (“Bulverde”) and the Guadalupe–Blanco River Authority (“GBRA”) sought declaratory judgments in the Comal County District Court. They asked the trial court to determine Bexar Metropolitan Water District’s (“BexarMet”) boundaries, to determine if BexarMet can provide water-utility services outside its boundaries, and to determine whether BexarMet has the authority to expand its territory outside of the boundaries defined in BexarMet’s enabling act. In response, BexarMet filed a plea to the jurisdiction arguing that the district court did not have subject-matter jurisdiction over the controversy in question. The district court denied BexarMet’s plea to the jurisdiction, and BexarMet appeals that decision. See Tex. Civ. Prac. & Rem.Code Ann. § 51.014(a) (West Supp.2004–05). On appeal, BexarMet contends that the Texas Water Code prohibits Bulverde and GBRA *83 from contesting its boundaries, that Bulverde and GBRA do not have standing to file the claims in question, that the Texas Commission on Environmental Quality (“the Commission”) has exclusive and primary jurisdiction over the claims in question, and that GBRA cannot bring a cause of action under the Uniform Declaratory Judgment Act (“UDJA”) because it does not qualify as a “person” entitled to bring the suit. We will affirm the district court’s denial of BexarMet’s plea to the jurisdiction.

FACTUAL AND PROCEDURAL BACKGROUND

Water districts are created by statute and can only exercise powers clearly given to them by the legislature. Harris County Water Control & Imp. Dist. No. 58 v. City of Houston, 357 S.W.2d 789, 796 (Tex.Civ.App.-Houston 1962, writ ref’d n.r.e.).

Some water-district enabling acts provide that water districts may sell or distribute water only within their boundaries. See, e.g., Act of May 29, 1965, 59th Leg., R.S., ch. 557, § 2(a), 1965 Tex. Gen. Laws 1207, 1208 (amending Act of May 20, 1937, 45th Leg., R.S., ch. 454, § 2(a), 1937 Tex. Gen. Laws 1128, 1128) (District may “sell ... within the boundaries of the District”). Other enabling acts allow a water district to distribute or sell water within or without the district’s boundaries. See, e.g., Act of May 4, 1961, 57th Leg., R.S., ch. 114, § 5(f), 1961 Tex. Gen. Laws 217, 220 (District may “sell ... water within or without the boundaries of the district”).

In 1947, the Texas Attorney General released an opinion stating that a specific water district could not sell water outside of its boundaries because its enabling statute limited sale of water to within the district. Op. Tex. Att’y Gen. No. V–319 (1947). The attorney general concluded that if a district was not authorized to sell or distribute water outside of its boundaries, the legislature must have intended that the water only be sold or distributed within the water district’s boundaries. Id.

BexarMet was created in 1945 and was given the authority of a “governmental agency, a body politic and corporate, and a municipal corporation.” Act of May 9, 1945, 49th Leg., R.S., ch. 306, § 2, 1945 Tex. Gen. Laws 491, 492 (“BexarMet Act”). BexarMet’s original enabling act stated that BexarMet’s district was within Bexar County, Texas. Id. § 5, 1945 Tex. Gen. Laws at 494. The original enabling act allowed BexarMet to annex territory and expand its boundaries. Id. § 6, 1945 Tex. Gen. Laws at 496. In addition, BexarMet’s boundaries were extended automatically to any territory that was annexed into the City of San Antonio. Id. § 6a, 1945 Tex. Gen. Laws at 497.

On several occasions, BexarMet has expanded its territory to areas outside the territory defined in its original enabling act. However, rather than annexing territory as provided for in the original enabling act, BexarMet has, over the years, enlarged its territory by obtaining certificates of convenience and necessity (“CCNs”) from the Commission1 in order to serve the water needs of cities and rural areas throughout the state.2

*84 The controversy in question began in 2000 when BexarMet and Bulverde both filed applications with the Commission asking for a CCN to provide water service to part of southwestern Comal County. In its application, Bulverde informed the Commission that in order to fulfill its water service requirements under the CCN, it would be relying on an agreement with GBRA to provide Bulverde with water.

The competing applications of BexarMet and Bulverde were referred to the State Office of Administrative Hearings. The administrative law judge recommended that BexarMet’s CCN application be granted and Bulverde’s be denied. Bulverde and GBRA objected to the proposal for decision, and the Commissioners reversed the decision of the administrative law judge and awarded CCN No. 12864 to Bulverde. BexarMet appealed the decision of the Commissioners to the Travis County District Court.

In 2003, after the Commissioners awarded the CCN to Bulverde, the legislature passed Senate Bill 1494, which amended BexarMet’s enabling act. Act of May 28, 2003, 78th Leg., R.S., ch. 375, 2003 Tex. Gen. Laws 1593 (“BexarMet Amendment”) (amending BexarMet Act, 1945 Tex. Gen. Laws 491). The amendment added the words “within the District” to statutory language describing BexarMet’s ability to develop, transport, deliver, distribute, store, and treat water. BexarMet Amendment, § 2, 2003 Tex. Gen. Laws at 1593 (amending BexarMet Act § 3(a), 1945 Tex. Gen. Laws at 492). The amendment also added two new provisions that granted BexarMet new powers, but the language limited the authority to act to “within” BexarMet’s district. BexarMet Amendment, § 2, 2003 Tex. Gen. Laws at 1595. In addition, the amendment defined BexarMet’s boundaries. The boundaries included not only Bexar County but also the territory that had been certificated to BexarMet in prior CCNs issued by the Commission and described in CCN Nos. 10675, 12759, and 12760. BexarMet Amendment, § 3, 2003 Tex. Gen. Laws at 1596. When Senate Bill 1494 passed, CCN Nos. 10675, 12759, and 12760 identified areas in Bexar, Comal, Medina, and Atascosa counties as part of BexarMet’s territory.

Bulverde and GBRA assert that the addition of “within” to the enabling act provisions evidences an intention by the legislature to limit the activities of BexarMet to within its own territory. Bulverde and GBRA also insist that, after the amendment inserted within into BexarMet’s enabling act, BexarMet does not have the authority to provide water service to areas outside of its boundaries including the areas in Comal County that were certificated to Bulverde by CCN No. 12864. Finally, Bulverde and GBRA contend that the amendment limits BexarMet’s boundaries to those areas described in the amended enabling act and prevents BexarMet from expanding its boundaries.

In response, BexarMet asserts that the amendment to its enabling act does not prevent it from expanding its service areas or its boundaries through CCNs granted by the Commission. BexarMet concedes that the amendment repealed sections 6 and 6a of the original enabling act, which had given BexarMet the power to annex territory and had automatically extended BexarMet’s boundaries when San Antonio’s city limits were extended, but contends that the amendment does not prevent BexarMet from annexing territory through CCNs issued by the Commission. See BexarMet Amendment, § 5(b), 2003 Tex. Gen. Laws at 1596 (amending BexarMet Act, §§ 6, 6a, 1945 Tex. Gen. Laws at 496). As proof of this assertion, BexarMet points to a letter written by the sponsor of Senate Bill 1494 to the Commission’s executive *85 director stating that Senate Bill 1494 repealed portions of BexarMet’s enabling act that were inconsistent with a federal court decision regarding voting rights in BexarMet elections, but it states that Senate Bill 1494 did not restrict BexarMet’s ability to expand its boundaries or obtain CCNs.

After the legislation was enacted, Bulverde and GBRA filed suit in Comal County District Court in order to prevent BexarMet from expanding into Comal County. In their suit, Bulverde and GBRA asked for declaratory judgments regarding BexarMet’s statutory boundaries, BexarMet’s authority to annex territory outside its statutory boundaries, and BexarMet’s authority to provide water-utility services outside of its statutory boundaries. Specifically Bulverde and GBRA wanted the court to declare the following: (1) BexarMet’s boundaries include only the territory listed in its current enabling statute, (2) BexarMet does not have the authority to annex territory outside of its boundaries, (3) BexarMet cannot provide water-utility services to areas outside its boundaries including areas in Comal County not already awarded to BexarMet, and (4) Bulverde, not BexarMet, has the exclusive right to provide water-utility service to the areas in Comal County listed in CCN No. 12864.

In response, BexarMet filed a motion to transfer venue to Travis County, a plea to the jurisdiction, and a plea in abatement. The district court denied all of BexarMet’s requests. BexarMet files this interlocutory appeal from the denial of its plea to the jurisdiction.

STANDARD OF REVIEW

A person may file an interlocutory appeal from either the granting or the denial of a plea to the jurisdiction brought by a governmental unit.3 Rylander v. Caldwell, 23 S.W.3d 132, 135 (Tex.App.-Austin 2000, no pet.)).

Because the statute authorizing interlocutory appeals is a narrow exception to the general rule that only final judgments and orders are appealable, we must give it a strict construction. See Tober v. Turner of Tex., Inc., 668 S.W.2d 831, 835 (Tex.App.-Austin 1984, no writ). Thus, we will limit our discussion to the narrow issue that is before us, the question of whether the trial court erred in denying BexarMet’s plea to the jurisdiction.

We review a district court’s ruling on a plea to the jurisdiction de novo. Beacon Nat’l Ins. Co. v. Montemayor, 86 S.W.3d 260, 266 (Tex.App.-Austin 2002, no pet.).

DISCUSSION

BexarMet contends that the Comal County court does not have jurisdiction to hear Bulverde’s and GBRA’s claims. On appeal, BexarMet raises the following claims: (1) only the attorney general, not Bulverde or GBRA, may file a suit contesting a water district’s boundaries; (2) Bulverde and GBRA lack standing to file this lawsuit; (3) the Commission has primary or exclusive jurisdiction over the subject matter of this lawsuit; and (4) GBRA does not qualify as a person entitled to bring this suit under the UDJA. We will address BexarMet’s claims in order.

Only the Attorney General may File Suit

In its first issue on appeal, BexarMet contends that Tex. Water Code Ann. § 49.066 (West 2000). BexarMet asserts that challenges to a water district’s boundaries can only be brought by the attorney general in a quo warranto proceeding.

A writ of quo warranto is an ancient common-law writ that gave the king an action against a person who claimed or usurped any office, franchise, or liberty, to inquire by what authority that person supported the claim to hold office. Tex. Civ. Prac. & Rem.Code Ann. § 66.002 (West 1997).

Tex. Water Code Ann. § 49.066(d). However, the water code does allow the attorney general to file a suit contesting either the validity of the creation of a water district or the validity of the boundaries of a water district enacted by the legislature. BexarMet claims that the suit filed by Bulverde and GBRA impermissibly contests BexarMet’s boundaries. To support this assertion, BexarMet points to language in the trial court pleadings in which Bulverde and GBRA describe their suit as one involving a dispute over BexarMet’s boundaries. BexarMet also points to language in Bulverde’s and GBRA’s amended pleadings and motions that repeatedly refer to BexarMet’s boundaries.

However, we do not interpret La Salle County Water Improvement Dist. No. 1 v. Guinn, 40 S.W.2d 892 (Tex.Civ.App.-San Antonio 1931, writ ref’d) (writ of quo warranto *87 required to contest legality of 85,000 acre water district reduced from 200,000 acres).

The third-party prohibition does not apply in this case because Bulverde and GBRA are not attacking the validity of BexarMet’s boundaries as defined by the legislature. Here, Bulverde and GBRA are asking the district court to determine what BexarMet’s boundaries are after Senate Bill 1494 amended BexarMet’s enabling statute. In addition, Bulverde and GBRA are seeking a court declaration determining whether BexarMet has the power to both expand its boundaries through a CCN and provide water-utility services outside its boundaries under BexarMet’s amended enabling act. Requesting a declaration regarding the location of a district’s boundaries and the district’s authority to provide service and expand its boundaries is not the same as challenging the validity of those boundaries. Such determinations are not prohibited by section 49.066.

Because section 49.066 of the Texas Water Code does not prohibit Bulverde and GBRA from filing their claims before the Comal County District Court, we overrule BexarMet’s first issue.

Standing

In its second issue on appeal, BexarMet urges that Bulverde and GBRA lack standing to file the suit in question for the following three reasons: (1) only the attorney general can file boundary contests; (2) competitors of BexarMet cannot file suit to limit BexarMet’s ability to act; and (3) Bulverde and GBRA do not have an underlying cause of action necessary to confer standing for a UDJA claim.

As for point number one, we have already explained that a quo warranto proceeding is not necessary to pursue Bulverde’s and GBRA’s claims and that it is not necessary for the attorney general to file these claims because Bulverde and GBRA are not attacking the validity of the creation of BexarMet’s boundaries.

As for BexarMet’s second point, although there are cases suggesting that a competitor, without more, lacks standing to challenge the actions of its competitor, this prohibition does not apply here. See, e.g., Mulcahy v. Houston Steel Drum Co., 402 S.W.2d 817, 819–20 (Tex.Civ.App.-Austin 1966, no writ) (attorney general can file quo warranto action to prevent corporation from engaging in behavior prohibited by law).

However, in this case, GBRA is not merely a competitor of BexarMet. BexarMet has filed with the Commission a petition to compel raw water commitment from GBRA. The petition would require GBRA to provide BexarMet with 3,000 acre-feet of water per year. GBRA, therefore, has a larger stake in the outcome of this case than as a mere competitor.

In addition, Bulverde and GBRA are claiming that BexarMet is acting beyond the authority granted to it by statute. Bulverde and GBRA insist that after Senate Bill 1494 amended BexarMet’s enabling act, BexarMet lacks the authority to *88 annex territory outside its boundaries and does not have the authority to provide or seek to provide retail water-utility service to areas outside its boundaries including the areas certificated to Bulverde.

If a water district acts beyond its statutory powers, its actions are void. City of Irving v. Callaway, 363 S.W.2d 832, 834 (Tex.Civ.App.-Dallas 1962, writ ref’d n.r.e.) (quo warranto proceeding necessary where actions are voidable, but quo warranto proceeding not necessary and claim may be brought by private citizens affected by action when annexation ordinance attacked on grounds alleging action void).

Bulverde and GBRA seek declarations that actions undertaken by BexarMet are beyond the scope of its statutory authority and, therefore, void. In addition, both Bulverde and GBRA are parties affected by the actions of BexarMet. Bulverde and BexarMet are seeking to provide water-utility services in the same area, while GBRA could be forced to provide water to BexarMet. Because Bulverde and GBRA are alleging that BexarMet’s actions are beyond the scope of its statutory authority and because both are parties affected by the actions of BexarMet, Bulverde and GBRA have standing to seek a declaratory judgment.

In its third standing point, BexarMet contends that Bulverde and GBRA lack standing to bring suit against BexarMet because they do not have an underlying common-law, statutory, or constitutional cause of action. BexarMet asserts that the UDJA does not enlarge a court’s jurisdiction and that a claimant pursuing a declaratory judgment must have an underlying cause of action.

However, suits under the UDJA are not limited to cases where the parties have a cause of action separate and apart from the UDJA. City of Waco, 83 S.W.3d at 177.

Declaratory-judgment actions are intended to determine the rights of parties when a controversy has arisen, before any wrong has actually been committed, and are preventative in nature. The Pea Picker, Inc. v. Reagan, 632 S.W.2d 674, 677 (Tex.App.-Tyler 1982, writ ref’d n.r.e.) (trial court had power to construe Open Meetings Act and determine whether notice must be given and when meeting is required to be open).

Bulverde and GBRA have standing under the UDJA and have the right to have the courts interpret BexarMet’s amended enabling act to determine what BexarMet’s boundaries are, whether BexarMet can expand its territory through CCNs, and whether BexarMet has the authority to provide water-utility service outside its boundaries. See Pea Picker, 632 S.W.2d at 677. The allegations of Bulverde and GBRA are sufficient to confer jurisdiction on the district court.

BexarMet also insists that boundary disputes cannot be litigated under the UDJA. See Martin v. Amerman, 133 S.W.3d 262, 267–68 (Tex.2004). However, as previously discussed, Bulverde and GBRA are not disputing the validity of BexarMet’s boundaries, and therefore, this prohibition does not deny Bulverde and GBRA standing. Because we have concluded that Bulverde and GBRA have standing to file their claims, we overrule BexarMet’s second issue.

Whether the Commission has Exclusive or Primary Jurisdiction

In its next issue on appeal, BexarMet contends that the Commission has exclusive jurisdiction or primary jurisdiction over the issues raised in this appeal. An administrative agency has exclusive jurisdiction when the legislature gives the agency the sole authority to make an initial determination in a dispute. Id. at 222.

BexarMet insists that the legislature created a pervasive regulatory scheme for managing surface water in Texas and gave the Commission exclusive jurisdiction to decide the issues raised in this case and that Bulverde and GBRA must exhaust all administrative remedies available to them before seeking judicial review. See Cash Am., 35 S.W.3d at 15).

However, the relevant issues in this case involve a determination of what BexarMet’s boundaries are, whether BexarMet may provide water-utility service outside its boundaries, and whether BexarMet may expand its territory through CCNs issued by the Commission now that Senate Bill 1494 has passed. Unlike other cases finding an agency has exclusive jurisdiction,4 the determination of these issues will depend on the construction of a statute.

*90 Trial courts have general jurisdiction. Id.

Courts have the authority to determine what a statute means. Public Utils. Bd. of City of Brownsville v. Central Power & Light Co., 587 S.W.2d 782, 788 (Tex.Civ.App.-Corpus Christi 1979, writ ref’d n.r.e.).5

In this case, there is no statute giving the Commission the exclusive authority to determine what a water district’s enabling statute means.6 The Comal County District Court is not deprived of jurisdiction to determine what BexarMet’s boundaries are under its amended enabling act, whether BexarMet may expand its territory by obtaining CCNs, and whether BexarMet may provide water services outside the boundaries established by its enabling statute.

BexarMet also asserts that the Commission has primary jurisdiction over the claims in question. Primary jurisdiction is a prudential doctrine. Id.

Statutory interpretation or construction is not something that needs to be left to the Commission to decide. The Commission has no expertise that is greater than the courts in determining what a statute means. The Commission has neither exclusive jurisdiction nor primary jurisdiction over the issues raised in this case. We overrule BexarMet’s third issue on appeal.

Person under the UDJA

In its final claim of error, BexarMet contends that GBRA cannot bring a *91 cause of action under the UDJA because it does not qualify as a person entitled to bring a UDJA claim. The UDJA creates a remedy for “persons ... whose rights, status, or other legal relations are affected by a statute, municipal ordinance, contract, or franchise.” Tex. Civ. Prac. & Rem.Code Ann. § 37.004(a) (West 1997).

BexarMet asserts that if the UDJA had not defined a “person” in its statute, the Code Construction Act’s definition of a “person” would apply. Because the Code Construction Act’s definition of a person includes governmental entities and political subdivisions of the state, BexarMet argues GBRA would be a “person” under the Code Construction Act. City of LaPorte v. Barfield, 898 S.W.2d 288, 294 (Tex.1995) (under Code Construction Act, person includes governmental entities). However, BexarMet insists that the definition of a “person” under the UDJA is narrower than the definition given under the Code Construction Act and does not include upper level government entities like GBRA.

The definition of a person under the UDJA includes a “corporation of any character.” Tex. Civ. Prac. & Rem.Code Ann. § 37.001 (West 1997). GBRA’s enabling act declares that GBRA is “a governmental agency and body politic and corporate.” Act of Oct. 12, 1933, 43d Leg., 1st C.S., ch. 75, § 1, 1933 Tex. Gen. Laws 198, 198. Because GBRA is a corporation, it qualifies as a person under the UDJA. Therefore, GBRA has a cause of action under the UDJA, and we overrule BexarMet’s final issue on appeal.

CONCLUSION

Because we overrule all of BexarMet’s issues on appeal, we affirm the district court’s denial of BexarMet’s plea to the jurisdiction.

Footnotes

1

For convenience, we will refer to both the Commission and its predecessor, the Texas Natural Resource Conservation Commission, as the Commission.

2

BexarMet, through the CCN process, has expanded its service to areas in Atascosa, Comal, and Medina counties.

3

Tex. Civ. Prac. & Rem.Code Ann. § 100.001 (West Supp.2004–05).

4

See Burgess v. Gallery Model Homes, Inc., 101 S.W.3d 550, 558 (Tex.App.-Houston [1st Dist.] 2003, pet. denied) (holding that provisions of the tax code provide “the exclusive means of obtaining a refund on an improperly collected sales tax”).

5

See 32.001(a) (West 1998)).

6

See Subaru of Am., Inc. v. David McDavid Nissan, Inc., 84 S.W.3d 212, 223 (Tex.2002) (vehicle board has exclusive jurisdiction when statute said board had exclusive jurisdiction).

End of Document
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