TEXAS COURT OF APPEALS, THIRD DISTRICT, AT AUSTIN
NO. 03-12-00692-CV
North Central Texas Council of Governments, Appellant
v.
MRSW Management, LLC, Appellee
FROM THE DISTRICT COURT OF TRAVIS COUNTY, 200TH JUDICIAL DISTRICT
NO. D-1-GN-11-002447, HONORABLE AMY CLARK MEACHUM, JUDGE PRESIDING
OPINION
North Central Texas Council of Governments (NCTCOG) brings this interlocutory
appeal from the trial court’s order denying its pleas to the jurisdiction. See Tex. Civ. Prac. & Rem.
Code § 51.014(a)(8). For the reasons that follow, we reverse the trial court’s order and render
judgment dismissing appellee MRSW Managment, LLC’s claims against NCTCOG.
BACKGROUND
NCTCOG, a regional planning commission, was formed under chapter 391 of the
Local Government Code. See Tex. Loc. Gov’t Code §§ 391.001–.015; City of Frisco v. Commission
on State Emergency Commc’n, No. 03-08-00579-CV, 2009 Tex. App. LEXIS 5314, at *5–6 (Tex.
App.—Austin July 9, 2009, no pet.) (mem. op.) (recognizing NCTCOG as one of the regional
planning commissions operating in the state).
In August 2010, NCTCOG entered into a “Procurement Agreement” (the Agreement)
with the Texas State Administrative Agency (SAA), which is a division of the Department of Public
Safety (collectively, DPS), to “procure planning services.” The Agreement describes the scope of
work as follows:
NCTCOG will procure planning services for [DPS] to support statewide planning
efforts in areas such as grants, management, risk assessment, investment
justifications, strategic planning, part time grant management, and additional
planning activities to be identified.
The terms of the Agreement include that “NCTCOG covenants and represents that it is only serving
as the conduit for funding for [DPS]” and “NCTCOG does not set the project standards or judge the
effectiveness of the work performed. [DPS] solely retains those rights and responsibilities.”
The Agreement states that it is entered into “[p]ursuant to the Interlocal Cooperation
Act, Chapter 791 of the Texas Government Code,” see Tex. Gov’t Code §§ 791.001–.035 (Interlocal
Cooperation Contracts), and that “[DPS] will provide NCTCOG with selected contractors.” One of
the contractors that DPS selected and NCTCOG hired to provide services to DPS was MRSW, a
private information and technology contractor. MRSW’s services were related to homeland security
grant management programs. The funds to pay for the services were to flow from DPS to NCTCOG
to MRSW. Pursuant to the Agreement, NCTCOG issued purchase orders to MRSW. MRSW
thereafter provided services to DPS and invoiced NCTCOG for those services.
After DPS terminated the Agreement and did not release funds to NCTCOG to pay
MRSW, NCTCOG did not pay invoiced amounts to MRSW. Based upon NCTCOG’s failure to pay
the invoiced amounts, MRSW filed this suit in August 2011 against NCTCOG, alleging that MRSW
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had provided services and that it had not been paid for those services.1 MRSW asserted breach of
contract, sworn account, quantum meruit, attorney’s fees, and declaratory relief. NCTCOG
answered and filed third party claims against the State of Texas, DPS, and its subsidiaries, SAA and
Texas Homeland Security. NCTCOG and the third party defendants filed pleas to the jurisdiction
on immunity grounds. After a hearing, the trial court granted the pleas in January 2012 and
dismissed MRSW’s suit and NCTCOG’s third party claims. MRSW then filed a motion for new
trial only with respect to NCTCOG’s plea to the jurisdiction. The trial court granted the motion and
reinstated the case against NCTCOG. Thereafter, the parties conducted discovery, including taking
numerous depositions.
In June 2012, NCTCOG filed an amended answer and plea to the jurisdiction.
NCTCOG asserted governmental immunity and that it had not waived its immunity under chapter
271 of the Local Government Code. See Tex. Loc. Gov’t Code § 271.152 (waiving immunity of
local government entity to suit for certain claims). MRSW filed a response to the plea. MRSW
argued that NCTCOG did not have immunity under chapter 391 of the Local Government Code or,
alternatively, that chapter 271 waived immunity. Although both parties filed evidence to support
1
In a separate suit, MRSW brought claims directly against DPS and requested that the
dispute be referred to the State Office of Administrative Hearings (SOAH) under Chapter 2260 of
the Government Code. See MRSW Mgmt. LLC v. Texas Dep’t of Pub. Safety, No. 04-12-00715-CV,
2013 Tex. App. LEXIS 5369 (Tex. App.—San Antonio May 1, 2013, no pet. h.); see also Tex. Gov’t
Code §§ 2260.001–.108. The SOAH judge concluded that the matter should be dismissed because
MRSW did not have a contract that met the definition of “contract” contained in section 2260.001(1)
of the Government Code. See MRSW Mgmt. LLC, 2013 Tex. App. LEXIS 5369, at *3, 7. Our sister
court affirmed the trial court’s order affirming SOAH’s order. See id. at *11.
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their pleas, the relevant facts were not disputed.2 After a hearing, the trial court denied NCTCOG’s
amended plea. This interlocutory appeal followed.
ANALYSIS
NCTCOG raises three issues on appeal. It urges that the trial court erred by denying
its plea to the jurisdiction because: (i) it was entitled to governmental immunity from suit and
liability; (ii) governmental immunity attached in this case because the “planning and purchasing
functions” performed on behalf of DPS are statutorily classified as “governmental functions and
services” under section 791.003 of the Government Code; and (iii) its immunity was not waived
under section 271.152 of the Local Government Code.
Standard of Review
We review a trial court’s order on a plea to the jurisdiction de novo. See Texas Dep’t
of Parks & Wildlife v. Miranda, 133 S.W.3d 217, 226 (Tex. 2004). We focus first on the plaintiff’s
petition to determine whether the pleaded facts affirmatively demonstrate that subject matter
jurisdiction exists. Id. at 226. We construe the pleadings liberally in favor of the plaintiff. Id. “If
the pleadings do not contain sufficient facts to affirmatively demonstrate the trial court’s jurisdiction
but do not affirmatively demonstrate incurable defects in jurisdiction, the issue is one of pleading
sufficiency and the plaintiffs should be afforded the opportunity to amend.” Id. “If the pleadings
affirmatively negate the existence of jurisdiction, then a plea to the jurisdiction may be granted
2
The parties’ evidence included a copy of the Agreement, purchase orders by NCTCOG to
MRSW, and excerpts from depositions.
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without allowing the plaintiffs an opportunity to amend.” Id. at 227. If a plea to the jurisdiction
challenges the existence of jurisdictional facts, the trial court may consider evidence and must do
so when necessary to resolve the jurisdictional issues raised. Id.; Bland Indep. Sch. Dist. v. Blue,
34 S.W.3d 547, 554 (Tex. 2000). If the jurisdictional evidence is undisputed or does not raise a fact
question, the trial court must rule on the plea as a matter of law. Miranda, 133 S.W.3d at 228.
We also review matters of statutory construction de novo. See Texas Mun. Power
Agency v. Public Util. Comm’n, 253 S.W.3d 184, 192 (Tex. 2007). Of primary concern in
construing a statute is the express statutory language. See Galbraith Eng’g Consultants, Inc.
v. Pochucha, 290 S.W.3d 863, 867 (Tex. 2009). “We thus construe the text according to its plain
and common meaning unless a contrary intention is apparent from the context or unless such a
construction leads to absurd results.” Presidio Indep. Sch. Dist. v. Scott, 309 S.W.3d 927, 930 (Tex.
2010) (citing City of Rockwall v. Hughes, 246 S.W.3d 621, 625–26 (Tex. 2008)). We consider the
entire act, not isolated portions. 20801, Inc. v. Parker, 249 S.W.3d 392, 396 (Tex. 2008).
Governmental Immunity
In its first and second issues, NCTCOG contends that it is entitled to governmental
immunity from suit and liability as a political subdivision of the state and that governmental
immunity attached to its actions regarding MRSW’s claims because it was performing governmental
functions when it entered into the Agreement with DPS and then purchased services for DPS
from MRSW.
Governmental immunity deprives a trial court of subject matter jurisdiction unless
the political subdivision consents to suit and is properly asserted in a plea to the jurisdiction. See
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Rolling Plains Groundwater Conservation Dist. v. City of Aspermont, 353 S.W.3d 756, 759 (Tex.
2011) (per curiam) (noting that political subdivisions of the state are “entitled to governmental
immunity from a suit for money damages unless it has been waived”); Miranda, 133 S.W.3d at
225–26 (noting that sovereign immunity “properly asserted in a plea to the jurisdiction”). “When
performing governmental functions, political subdivisions derive governmental immunity from the
state’s sovereign immunity.” City of Houston v. Williams, 353 S.W.3d 128, 134 (Tex. 2011) (citing
City of Galveston v. State, 217 S.W.3d 466, 469 (Tex. 2007)); see also City of El Paso v. Heinrich,
284 S.W.3d 366, 372 (Tex. 2009) (“Sovereign immunity protects the State from lawsuits for money
damages.” (citing Texas Natural Res. Conservation Comm’n v. IT-Davy, 74 S.W.3d 849, 853
(Tex. 2002))).
A regional planning commission, such as NCTCOG, is defined in chapter 391 of the
Local Government Code as a “political subdivision of the state.” See Tex. Loc. Gov’t Code
§ 391.003(c); see also id. § 391.002(2) (defining “Commission” to mean “regional planning
commission, council of governments, or similar regional planning agency created under this
chapter”). As a political subdivision of the state, NCTCOG is entitled to governmental immunity
from suit when it is performing governmental functions. See City of Aspermont, 353 S.W.3d at 759;
Williams, 353 S.W.3d at 134.3
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Because we conclude that NCTCOG’s challenged actions were made while performing
governmental functions, we do not address the applicability of the governmental-proprietary
dichotomy that has been used to determine immunity from suit for tortious conduct. See Tooke
v. City of Mexia, 197 S.W.3d 325, 343 (Tex. 2006) (discussing governmental-proprietary
dichotomy).
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MRSW urges that governmental immunity does not apply because NCTCOG’s
actions—as a “mere agent of the State”—were outside the scope of its statutory authority. MRSW
asserts that chapter 391 did not authorize NCTCOG to contract with a state agency like DPS or with
a private party like MRSW and, therefore, that NCTCOG’s actions were outside its statutory
authority and subjected it to suit and liability just like any other corporation. MRSW’s argument
fails to take into account that the source of NCTCOG’s statutory authority is not limited to chapter
391, which chapter authorizes the existence of regional planning commissions and provides that
local governments may engage in regional planning as a group in a regional planning commission
and still be a local government entity, not a “corporation.” See generally Tex. Loc. Gov’t Code
§§ 391.001–.015 (addressing regional planning commissions in chapter of Subtitle C, “Planning and
Development Provisions Applying To More Than One Type of Local Government”).
The legislature expressly conferred statutory authority to regional planning
commissions in parts of the Government Code, including chapter 791. NCTCOG has express
authority to contract with the state or a state agency to purchase goods and services under that
chapter. See Tex. Gov’t Code §§ 791.001–.035 (Interlocal Cooperation Act). Section 791.025, titled
“Contracts for Purchases,” states: “A local government, including a council of governments, may
agree with another local government or with the state or a state agency, including the comptroller,
to purchase goods and services.” Id. § 791.025(a). Subsection (d) of section 791.025 defines
“council of governments” to mean “a regional planning commission created under Chapter 391,
Local Government Code.” Id. § 791.025(d). The Agreement and purchase orders here fall within
the plain language of section 791.025: NCTCOG—a local government—agreed with DPS—a state
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agency—to purchase services. See id. § 791.025(a); Scott, 309 S.W.3d at 930. The section does not
limit the local government’s choice of the provider of the goods or services.
MRSW urges that chapter 791 of the Government Code does not apply because its
purpose is limited to “increas[ing] the efficiency and effectiveness of local governments.” See Tex.
Gov’t Code § 791.001. MRSW argues that NCTCOG’s challenged actions did not “increase the
efficiency and effectiveness of local governments” and that section 791.025 “cannot be read to
include the use of a local government, including a council of governments, as a mere purchasing
agent for the State, where no local government or council received any benefit.” Section 791.001,
however, expressly authorizes local governments like NCTCOG “to contract, to the greatest possible
extent . . . with agencies of the state.” See id. We decline to interpret section 791.001 to preclude
section 791.025’s application here. See Parker, 249 S.W.3d at 396.
MRSW also urges that chapter 791 does not apply because its petition alleged that
the services that it provided were for “consultation and program management services” and that these
types of services do not fall within the categories of services listed in section 791.003. See Tex.
Gov’t Code § 791.003. Section 791.003 defines “governmental functions and services” to include
“planning,” “administrative functions,” and “other governmental functions in which the contracting
parties are mutually interested.” Id. § 791.003(3)(I), (K), (N). “Administrative functions” are
defined to mean “functions normally associated with the routine operation of government, including
. . . purchasing.” Id. § 791.003(1). It was MRSW’s burden to affirmatively establish or raise a fact
issue that immunity did not apply. See Miranda, 133 S.W.3d at 228. Regardless of how MRSW
characterized the services that it provided to DPS in its pleadings, the undisputed evidence was that
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NCTCOG purchased the services from MRSW for DPS and that the services concerned homeland
security programs. See id. Based upon this evidence, we conclude that NCTCOG’s challenged
actions fall within the meaning of “purchasing,” “planning,” or other functions of mutual interest.
See Tex. Gov’t Code § 791.003(1), (3)(I), (K), (N); Scott, 309 S.W.3d at 932; Miranda, 133 S.W.3d
at 228.
To the extent that MRSW argues that NCTCOG did not raise section 791.003 before
the trial court, the Agreement was jurisdictional evidence before the trial court. The Agreement
states that it was an “Interlocal Cooperative Agreement entered into under chapter 791 of the
government code.” See Tex. Gov’t Code § 791.003(2) (defining “interlocal contract” as “a contract
or agreement made under this chapter”). Based upon the undisputed evidence, we conclude that
NCTCOG was performing governmental functions when it entered into the Agreement and then
issued purchase orders to MRSW and that NCTCOG has governmental immunity from MRSW’s
claims. See id. §§ 791.003, .025; Williams, 353 S.W.3d at 134. We sustain NCTCOG’s first and
second issues.
Waiver of Immunity Under Chapter 271
In its third issue, NCTCOG contends that immunity was not waived under section
271.152 of the Local Government Code because MRSW never pleaded waiver, MRSW failed to
raise a material fact issue regarding the application of section 271.152, and it is “undisputed that the
goods and services at issue were provided to and for the sole benefit of DPS.” See Tex. Loc. Gov’t
Code § 271.152.
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“In a suit against a governmental unit, the plaintiff must affirmatively demonstrate
the court’s jurisdiction by alleging a valid waiver of immunity.” Dallas Area Rapid Transit
v. Whitley, 104 S.W.3d 540, 542 (Tex. 2003); see Texas Dep’t of Transp. v. Jones, 8 S.W.3d 636,
638 (Tex. 1999) (describing distinction between immunity from suit, which bars the action, and
immunity from liability). Immunity from suit may only be waived by “clear and unambiguous”
language. Tex. Gov’t Code § 311.034 (addressing waiver of sovereign immunity); Tooke v. City of
Mexia, 197 S.W.3d 325, 328 n.2 (Tex. 2006) (noting that “well-established rule” that legislature may
only waive sovereign immunity by “clear and unambiguous language” also applies to waiver of
immunity for other governmental entities); see Jones, 8 S.W.3d at 638 (plaintiff must establish
express consent to suit “by reference to a statute or to express legislative permission”). To defeat
NCTCOG’s plea then, MRSW had to affirmatively demonstrate a valid waiver of immunity by clear
and unambiguous language.
Section 271.152 waives immunity to suit for certain breach of contract claims against
local governmental entities. See Tex. Loc. Gov’t Code § 271.152. A contract that is subject to the
waiver in section 271.152 is defined to mean “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). NCTCOG is a “local government
entity” as that term is defined in chapter 271 and, therefore, could waive its immunity from suit by
entering into a contract subject to that chapter. See id. § 271.151(3) (defining “local government
entity” to mean “a political subdivision of this state, other than a county or unit of state government
as that term is defined by Section 2260.001, Government Code”).
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MRSW argues that the undisputed evidence showed that MRSW entered into a
contract with NCTCOG that was subject to the chapter because it was “for providing goods or
services to NCTCOG.” Even if we assume that MRSW pleaded waiver before the trial court, it was
undisputed that the services at issue were provided to DPS, not NCTCOG. The plain language of
section 271.151 limits its reach to agreements “for providing goods or services to the local
governmental entity.” See Scott, 309 S.W.3d at 932; see also Kirby Lake Dev., Ltd. v. Clear Lake
City Water Auth., 320 S.W.3d 829, 838–39 (Tex. 2010) (interpreting section 271.151 to require that
“goods or services” be provided to local contracting governmental entity); East Houston Estate
Apartments, LLC v. City of Houston, 294 S.W.3d 723, 736–37 (Tex. App.—Houston [1st Dist.]
2009, no pet.) (concluding that City was “conduit of federal funds,” “no services were provided
directly to the City,” and that section 271.152 did not apply and affirming trial court’s order granting
the City’s plea to jurisdiction).
It was MRSW’s burden to affirmatively establish or raise a fact issue that immunity
had been waived by “clear and unambiguous language.” See Tooke, 197 S.W.3d at 328 n.2;
Miranda, 133 S.W.3d at 228. The undisputed evidence showed that MRSW provided services to
DPS, not NCTCOG. Based upon this evidence and section 271.152’s plain language, we conclude
that MRSW did not establish or raise a fact issue concerning waiver of immunity under chapter 271.
We sustain NCTCOG’s third issue.
CONCLUSION
For these reasons, we reverse the trial court’s order denying NCTCOG’s plea to the
jurisdiction and render judgment dismissing MRSW’s claims against NCTCOG.
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__________________________________________
Melissa Goodwin, Justice
Before Chief Justice Jones, Justices Goodwin and Field
Concurring Opinion by Chief Justice Jones, joined by Justices Goodwin and Field
Reversed and Rendered
Filed: June 20, 2013
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