Metro Ford Truck Sales v. Texas Department of Motor Vehicles, Motor Vehicle Division Freightliner LLC, N/K/A Daimler Trucks North America LLC And Sterling Truck Corporation

TEXAS COURT OF APPEALS, THIRD DISTRICT, AT AUSTIN

NO. 03-12-00411-CV

Metro Ford Truck Sales, Appellant

v.

Texas Department of Motor Vehicles, Motor Vehicle Division; Freightliner LLC, n/k/a
Daimler Trucks North America LLC; and Sterling Truck Corporation, Appellees

DIRECT APPEAL FROM THE MOTOR VEHICLE DIVISION OF THE
TEXAS DEPARTMENT OF MOTOR VEHICLES

MEMORANDUM OPINION

Metro Ford Truck Sales (“Metro”) seeks direct judicial review in this Court of two

orders signed by the Executive Director (“ED”) of the Motor Vehicle Division (“the Division”) of

the Texas Department of Motor Vehicles (“the Department”). See Tex. Occ. Code Ann.

§ 2301.751(b) (West 2012). Metro contends in three issues that the Division ED did not have the

authority to enter the orders, that entry of the orders violated its right to due process, and that the

orders were not supported by substantial evidence. We will affirm.

FACTUAL AND PROCEDURAL BACKGROUND

This cause is part of a long-running dispute between, on one side, Ford Motor

Company and its successors, Freightliner Corporation (“Freightliner”) and Sterling Truck

Corporation (“Sterling”), and, on the other side, Metro, a Ford franchisee. The complex history of
the dispute between these companies has been set forth in detail in several of this Court’s opinions1

and is familiar to the parties. We will not repeat it except as relevant to the issues in this appeal.

The Department, through the Division and its ED, regulates the distribution and sale

of motor vehicles in Texas pursuant to the provisions of occupations code chapter 2301. See id.

§§ 2301.001, 2301.101, 2301.151-.153. The Division licenses vehicle manufacturers/distributors

and their franchised dealers and regulates the relationship between them, including hearing disputes

over whether a manufacturer/distributor (such as Ford) has shown good cause to terminate one of

its dealers (such as Metro). See id. §§ 2301.001, 2301.004, 2301.151, 2301.152. Before 2009 the

Division was part of the Texas Department of Transportation (“TxDOT”), and the Division ED

had the authority to issue final orders in administrative proceedings. See Act of May 30, 2005,

79th Leg., R.S., ch. 281, §§ 7.01-.02, 2005 Tex. Gen. Laws 778, 839. In 2009 the Division was

moved to the newly created Department. See Act of May 23, 2009, 81st Leg., R.S., ch. 933, §§6-8,

2009 Tex. Gen. Laws 2485, 2519-21. Once the Department was created, the Division ED no longer

had the authority to make final decisions in administrative cases arising under chapter 2301; that

authority was transferred to the Department’s Board. See Occ. Code § 2301.709(d) (after reviewing

contested case, Board “shall issue a written final decision or order”).

1
See Freightliner Corp. v. Motor Vehicle Bd., 255 S.W.3d 356 (Tex. App.—Austin 2008,
pet. denied) (2008 Metro I); Sterling Truck Corp. v. Motor Vehicle Bd., 255 S.W.3d 368
(Tex. App.—Austin 2008, pet. denied) (Metro V); Ford Motor Co. v. Motor Vehicle Bd.,
No. 03-05-00290-CV, 2008 WL 1912102 (Tex. App.—Austin May 1, 2008, pet. denied) (mem. op.)
(Metro IV); Ford Motor Co. v. Motor Vehicle Bd., 21 S.W.3d 744, 748-54 (Tex. App.—Austin 2000,
pet. denied) (2000 Metro I).

2
 In opinions handed down in May 2008, this Court remanded Metro I for the second

time and Metro V for the first time. Thereafter, Metro filed for bankruptcy. Freightliner and Sterling

sought and obtained relief from the bankruptcy court’s automatic stay and filed with the agency a

motion requesting that the “Director and the Motor Vehicle Division” enter final orders in the

Metro I and Metro V agency proceedings in accordance with this Court’s opinions issued with the

judgments remanding the cases. Metro did not file a response to the motion. On February 17, 2012,

the Division, acting through its ED, issued orders in the two cases. The order in Metro I provided

that Freightliner and Sterling2 were no longer required to supply heavy-duty trucks to Metro pursuant

to the franchise agreement Metro had with Ford. The order in Metro V included the same provision

along with a recitation that there is no franchise agreement between Sterling and Metro and that

agency orders made during the proceeding did not create a franchisor-franchisee relationship

between them. The Metro V order also vacated a civil penalty of $428,000 previously assessed by

the agency against Sterling. Each order dismissed Freightliner and Sterling from the respective

agency proceedings and became final orders as to them.

Thereafter, Metro filed motions for rehearing asserting that the orders were issued

without due process and that the ED lacked authority to issue them. The ED overruled the motions

for rehearing. Metro then filed a suit for judicial review in Travis County district court. See Occ.

Code § 2301.751(a). Sterling removed the case from the trial court to this Court as permitted by the

occupations code. Id. § 2301.751(b).

2
In 1997, while the administrative proceeding in Metro I was pending, Ford sold assets of
its heavy-duty truck division to Freightliner. Freightliner then formed Sterling, a wholly owned
subsidiary, to produce and distribute its line of heavy-duty trucks.

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 DISCUSSION

The Director’s Authority to Issue the Orders

In its first issue, Metro contends that the ED did not have the authority to issue the

orders. Metro maintains that after 2009, when the Department was created and final-order authority

was transferred to its Board, the Division ED no longer had any authority to issue final orders in

contested cases involving either a dealer’s protest of a manufacturer’s decision to terminate a

franchise, which was the issue in Metro I, see id. § 2301.453(g) (board shall determine whether party

seeking termination of franchise has established good cause for proposed termination), or a

manufacturer’s rejection of a dealer’s application to transfer ownership of a franchise to another

person, which was the issue in Metro V, see id. § 2301.360 (board must determine whether rejection

was reasonable). The Division counters that one of the non-amendatory provisions of the bill

creating the Department and transferring both the Division to the Department and its final-order

authority to the Department’s Board is a “savings clause.” According to the Division, this provision

expresses the legislature’s intent that the former procedure for deciding contested cases such as

Metro I and Metro V continues to control in cases filed before the 2009 amendments, and therefore

the ED retains order authority in those cases.

The provision the Division relies on provides:

The [Department] shall continue any proceeding involving the [Division] . . . that
was brought before the effective date of this Act in accordance with the law in effect
on the date the proceeding was brought, and the former law is continued in effect for
that purpose.

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Act of May 23, 2009, 81st Leg., R.S., ch. 933, § 6.01(d), 2009 Tex. Gen. Laws 2485, 2519-20

(emphasis added). Determining whether this provision expresses the legislative intent advanced

by the Division—i.e., that the ED retains final-order authority for cases filed before the

2009 amendments—involves statutory construction and presents a question of law that we review

de novo. See State v. Shumake, 199 S.W.3d 279, 284 (Tex. 2006). Our primary objective in

statutory construction is to give effect to the legislature’s intent. See id. We find that intent “first

and foremost” in the statutory text. Lexington Ins. Co. v. Strayhorn, 209 S.W.3d 83, 85 (Tex. 2006).

“Where text is clear, text is determinative of that intent.” Entergy Gulf States, Inc. v. Summers,

282 S.W.3d 433, 437 (Tex. 2009) (citing Shumake, 199 S.W.3d at 284; Alex Sheshunoff Mgmt.

Servs. v. Johnson, 209 S.W.3d 644, 651-52 (Tex. 2006)). Only when the statutory text is ambiguous

do we resort to rules of construction or extrinsic aids. Entergy Gulf States, Inc., 282 S.W.3d at 437.

Section 6.02, the non-amendatory provision the Division relies on, unambiguously

states that any proceeding that was brought before the effective date of the amendments is governed

by the law in effect when the proceeding was brought and that the “former law” continues in effect

for that purpose. The legislature’s intent, as revealed by the plain text of the statute, was that

proceedings that had already been instituted when the new statute took effect should continue under

the law as it existed prior to the amendments.

Despite this plain language, Metro argues that because the amendments to the statute

include both substantive and procedural changes, the savings clause simply operates to clarify that

the substantive changes to occupations code chapter 2301 do not apply retroactively to cases already

in progress, and only the prior substantive law is saved for that purpose. In Metro’s view,

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section 6.02 does not also apply to the procedural changes enacted by the 2009 amendments, the

legislature intended those changes to have retroactive application, and the prior procedural law is

not saved. To support this position—one that goes beyond the plain language of section 6.02, which

makes no distinction regarding former procedural and substantive law—Metro relies on a provision

of the Code Construction Act and case law that distinguishes between substantive amendments,

which are presumed to apply prospectively only, and procedural amendments, which are not subject

to that presumption. See Tex. Gov’t Code Ann. § 311.022 (West 2005) (statute is presumed

prospective in operation unless expressly made retrospective); State v. Fidelity & Deposit Co.,

223 S.W.3d 309, 311-12 & n.2 (Tex. 2007) (same). Metro further argues that while the Texas

Constitution prohibits retroactive application of laws that affect vested rights, there is no such

prohibition as to procedural and remedial laws that generally do not affect vested rights. See Subaru

of Am., Inc. v. David McDavid Nissan, Inc., 84 S.W.3d 212, 222-23 (Tex. 2002) (general rule for

prospective operation does not apply for statutory amendment that is merely procedural or remedial).

Metro’s argument misses the mark and does not compel the conclusion that the

savings clause saves only the substantive portions of the “former law” for application to pending

proceedings. While Metro correctly points out that there is no constitutional or other impediment

that would have prevented the legislature from making the procedural aspects of the amendments

retroactive, the plain language of the savings clause reveals that it chose not to. Rather, the savings

clause expresses the legislature’s intent that the former law—both its substantive and procedural

aspects—remain in effect and govern proceedings involving the Division that were instituted before

the effective date of the amendments. Metro’s interpretation requires that we consider the words

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“former law” to refer only to former substantive law and not to the procedures formerly in place.

But there is no indicia of legislative intent that the term “former law” be so limited, and there is no

basis for making that inference. The cases Metro relies on that employ presumptions regarding

prospective application to treat procedural and substantive amendments differently do so only in the

absence of a savings clause revealing the legislature’s intent regarding application of the new statute.

In the present case, there is no ambiguity in the savings clause at issue. Accordingly, we hold that

both the procedural and substantive aspects of the law governing the proceedings prior to the

2009 amendment continue to apply to both Metro I and Metro V.

Metro asserts that even if the savings clause applies to procedural aspects of the

amendments, the ED was still not authorized to issue the orders. The savings clause provides that

the proceeding is governed by “the law in effect on the date the proceeding was brought.” Metro I

was filed in 1994, and Metro V was filed in 2004. In 1994, final-order authority in proceedings

related to dealership termination was vested in the Motor Vehicle Board of TxDOT. Likewise, in

2004 final-order authority in proceedings related to the transfer of a dealership was vested in the

Motor Vehicle Board of TxDOT. Metro argues, then, that, according to “the law in effect on the date

the proceeding was brought,” only the Motor Vehicle Board of TxDOT has the authority to issue

orders in Metro I and Metro V. While the statute’s text should be considered first and foremost in

determining legislative intent, we are also obligated to avoid construing statutes in a manner that

leads to absurd results that the legislature could not possibly have intended, even if the plain text

might be susceptible of such an interpretation. See Entergy Gulf States, Inc., 282 S.W.3d at 437

(recognizing “absurd results” limitation on literal reading of statutory text where legislature could

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not possibly have intended such interpretation). Accepting Metro’s interpretation would lead to such

an absurd result because it would mean that the 2009 legislature intended for final-order authority

in these proceedings to remain with a decision-maker that it had abolished in 2005, four years earlier.

See Act of May 30, 2005, 79th Leg., R.S., ch. 281, § 7.06(1), 2005 Tex. Gen. Laws 778, 840

(abolishing Motor Vehicle Board of TxDOT and moving its authority to ED of Motor Vehicle

Division). The legislature could not have intended for final-order authority to remain with a board

that it had abolished, effectively preventing resolution of Metro I and Metro V. We believe that the

only reasonable interpretation of section 6.02 is that proceedings already begun would continue to be

governed by the law governing them at the time of the 2009 amendments.3 At that time, final-order

authority was vested in the ED. This was the case because, in contrast to the 2009 amendments, the

2005 amendments did not include a savings clause that saved either substantive or procedural aspects

of the former law so as to continue to apply to pending proceedings. Accordingly, cases filed both

in 1994 and in 2004 were subject to the 2005 amendments that changed the decision-maker in

proceedings such as Metro I and Metro V from the Motor Vehicle Board of TxDOT to the ED of the

Division. As discussed above, in the absence of a savings clause, we presume that the procedural

aspects of the amendments applied retroactively and therefore governed both Metro I and Metro V.

Thus, the “law in effect” for both of these cases includes the legislature’s transfer of decision-making

3
Under normal circumstances, the law in effect on the date a proceeding such as Metro I or
Metro V was filed would be the same as the law governing such a proceeding at the time of the
2009 amendment. Before the 2009 amendments, the law remained the same for approximately five
years. Most administrative proceedings still pending would not span both a pre- and post-2005 time
frame. It is only because these proceedings now have at least a seventeen-year history, and are still
pending despite having been filed before even the 2005 amendments, that there can even be an
argument that final-order authority is retained by the non-existent Motor Vehicle Board of TxDOT.

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authority from the Motor Vehicle Board of TxDOT to the Division ED. Consequently, the Division

ED had the authority to issue both orders at issue here. We overrule Metro’s first issue.

Due Process and Substantial Evidence

Metro’s second and third issues advance three complaints: (1) that the agency

violated its due-process rights by issuing the orders without providing notice to Metro, holding a

hearing, or hearing evidence after the 2008 remand; (2) that the orders are not supported by findings

of fact and conclusions of law as required by the Administrative Procedure Act; and (3) that

the agency’s denial of Metro’s claim to have a Sterling truck franchise was not supported by

substantial evidence.

Sterling and Freightliner filed a motion for entry of final orders with the Division on

November 21, 2011. The certificate of service indicates that all counsel of record were served with

the motion by facsimile and by certified mail, return receipt requested. Metro does not assert that

it did not receive a copy of the motion. Metro does complain that the agency violated its due-process

rights by failing to give it notice of any hearing to present applicable evidence. But Metro did not

request a hearing on the motion. Plainly, the agency did not provide Metro with notice of any

hearing because it did not hold one. And, for the reasons that follow, no hearing was necessary for

the agency to enter the orders.

2012 Metro I Order

The Metro I Order issued in 2012 did three things: (1) it lifted, as to Freightliner and Sterling

only, a statutory stay that was put in place by the agency in 1994 when Metro initiated the contested

case seeking an agency determination that Ford’s proposed termination of Metro’s franchise violated

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the statutory prohibition against terminating a franchise without good cause, see Occ. Code

§ 2301.803(a) (statutory stay prohibits party stayed from committing act or omission that would

affect legal right, duty, or privilege of any party before agency), (2) it recited that Freightliner and

Sterling were no longer required to supply heavy-duty trucks to Metro, and (3) it dismissed

Freightliner and Sterling as parties to the contested case. For the reasons that follow, the agency was

authorized to take each of these actions without holding a hearing.

Freightliner (and subsequently Sterling) became subject to the statutory stay in 1997

when Ford sold its heavy-duty truck assets to Freightliner and the agency, having determined that

requiring Freightliner to continue to supply Metro with vehicles was necessary to maintain the status

quo pending the good-cause determination, made Freightliner a party to the proceeding. Metro does

not contend that the agency’s decision to lift a statutory stay requires evidentiary support or that the

agency is required to make findings to justify lifting such a stay. In fact, occupations code section

2301.803(b) expressly provides that “a statutory stay imposed by this chapter remains in effect until

vacated or until the proceeding is concluded by a final order or decision.” Id. § 2301.803(b);

Metro V, 255 S.W.3d at 373 (“The Board is expressly empowered to vacate its own stay.”). In their

motion for entry of final orders, Freightliner and Sterling informed the agency that Metro had sold

its Ford franchise and asserted that, as a consequence, there was no longer any basis to continue to

impose a stay on Freightliner or Sterling that required them to provide trucks to Metro. In fact, the

bankruptcy court’s order lifting the bankruptcy court’s automatic stay to permit Freightliner and

Sterling to seek final orders in Metro I and Metro V recites that the good cause for doing so was the

closing of the sale. Put differently, the agency’s stated reason for concluding in 1997 that

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Freightliner and Sterling were necessary parties to the contested case and for imposing the stay on

them—i.e., preserving Metro’s ability to operate its heavy-duty truck business—no longer existed.

The agency had the authority to lift the stay without a hearing, and the administrative record contains

evidence of its reason for doing so. Id.

Ordering that Freightliner and Sterling were no longer required to supply trucks to

Metro followed as a natural consequence of lifting the stay, which was the only thing creating the

obligation in the first place. See Metro V, 255 S.W.3d at 376 (“Sterling’s relationship with Metro

was limited to being a Board-mandated supplier of heavy-duty trucks to Metro.”). Having sold the

assets of its truck franchise, Metro had no further need for trucks. The sale eliminated the agency’s

reason for requiring Freightliner and Sterling to supply Metro with trucks during the pendency of the

contested case to determine whether Ford had good cause to terminate Metro’s franchise. Again,

no hearing was required for the agency’s order to clarify that once the statutory stay was lifted,

Freightliner and Sterling were no longer required to supply trucks to Metro.4 It also follows that the

reason Freightliner and Sterling were viewed by the agency as necessary parties to the contested case

was so that the agency could order them to continue to supply trucks to Metro pending the outcome

of the good-cause determination. Once the need for the truck supply ceased to exist, there was no

4
This Court has previously confirmed that the agency’s mandate that Freightliner and
Sterling supply trucks to Metro during the proceeding to determine whether Ford had good cause
to terminate Metro’s franchise did not create a franchisor-franchisee relationship between Metro
and Freightliner or Sterling. See Metro V, 255 S.W.3d at 376 (“Sterling’s relationship with Metro
was limited to being a Board-mandated supplier of heavy-duty trucks to Metro. Any franchise
relationship was potential only—not actual.”). Therefore, the obligation to supply trucks arose solely
from the agency’s orders and not from any independent relationship between Metro and Freightliner
or Sterling.

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further reason for Freightliner and Sterling to be parties to the proceeding, and their dismissal was

warranted without the need for further hearings or findings.

2012 Metro V Order

The Metro V Order issued in 2012 contains the same three provisions discussed

above, along with the following three additional orders: (1) that there is no franchise agreement

between Sterling and Metro, (2) that orders made pursuant to the statutory stay did not create a

franchisor-franchisee relationship between Sterling and Metro, and (3) that a $428,000 penalty

assessed against Sterling for interfering with Metro’s attempt to transfer its franchise to

another owner was vacated. As stated above, this Court had already affirmed that there was no

franchisor-franchisee relationship between Sterling and Metro and that the agency’s orders did not

create one. See id. Moreover, this Court had also previously held that in the absence of a franchise

relationship, the agency’s imposition of a civil penalty against Sterling was not supported by

substantial evidence and exceeded the Board’s power. See id. Specifically, this Court held:

The Board is empowered to penalize manufacturers and distributors who
unreasonably oppose the transfer of their own franchises, not those who oppose the
transfer either of a franchise to which they are not a party (that might be terminated
upon the resolution of a contested case) or of a franchise that they might offer upon
the resolution of another contested case proceeding, but that does not yet exist.

We conclude that the Board’s imposition of a civil penalty against Sterling for
opposing Metro’s proposed transfer of its Ford franchise was not supported by
substantial evidence and exceeded the Board’s power.

Id. Consequently, no further hearings or evidence was needed to support the agency’s action of

vacating a penalty that this Court already held was not supported by substantial evidence and

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exceeded the agency’s authority. And, because this Court had already so held, no further hearings

or evidence was needed to support the agency’s order confirming that no franchise relationship

existed between Metro and Sterling. The agency order simply embodied this Court’s holding in

Metro V.

Metro’s brief on appeal, however, appears to assert that the two orders were not

supported by substantial evidence because of outstanding issues regarding whether Metro is or might

become entitled to obtain a Sterling franchise. Metro correctly observes that while this Court’s

rulings prohibit the agency from revisiting its determination that good cause existed to terminate

Metro’s franchise, we did not render judgment actually terminating the franchise. See id. at 374 n.5

(“[T]he judgment of the Court in 2000 affirming the trial court’s judgment affirmed decisions by the

trial court and the Board finding good cause to terminate, not actually terminating the franchise.”);

id. at 378 (“The ALJ correctly stated that Metro held the franchise even after the remand and that the

good cause finding did ‘not force Metro to immediately and unconditionally give up its franchise.’”).

But whether or not the franchise has actually been terminated is immaterial to Metro’s right to hold

a Sterling franchise. As the agency previously found at a time when it believed that the good-cause

determination was unresolved, “whether or not there will ultimately be a franchisor-franchisee

relationship between Metro and Sterling still depends on the outcome of Metro I,” and that “if Metro

prevails in [Metro I], Metro still has the right to be franchised by Sterling.” See id. at 375-76. In its

brief, Metro characterizes this Court’s opinion in Metro V as recognizing that the agency “held that

Sterling’s right to deny Metro a Sterling franchise depends upon the resolution of Ford’s efforts to

terminate the Metro franchise.” (Emphasis added.) According to Metro, then, until the franchise

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is actually terminated, which it characterizes as “prevailing” in Metro I, its right to a franchise is still

an open question. Metro misapprehends this Court’s previous opinions. Metro I concerned only an

agency proceeding to determine whether Ford had good cause to terminate the franchise; it was

not a proceeding in which the agency was asked to terminate the relationship. See 2008 Metro I,

255 S.W.3d at 358 (“Metro filed a protest, triggering a proceeding before the Board to determine

whether Ford had good cause to terminate the franchise.”). In fact, the agency could not itself have

terminated the franchise during this proceeding. See Metro V, 255 S.W.3d at 373 n.5 (“Actual

termination likely usually follows a finding of good cause to terminate. Nevertheless, the statutes

authorize the Board to review whether a manufacturer has good cause to terminate a franchise, not

to order the termination.” (Emphasis added.)). Because the good-cause determination has been

made in favor of Ford, Metro has already failed to prevail in Metro I, and regardless of whether

Ford’s actual termination of the franchise has occurred, the agency has found that Ford has good

cause to do so; consequently, Metro no longer has a right to a Sterling franchise by virtue of its

relationship with Ford. See 2000 Metro I, 21 S.W.3d at 754 (Ford’s sale of certain assets of its

heavy-duty truck division to Freightliner resulted in Ford’s withdrawal from nationwide heavy-duty

truck market, and Ford heavy-duty truck dealers in good standing could apply to Freightliner for

franchise agreement); Metro V, 255 S.W.3d at 376 (franchise relationship between Freightliner and

Metro was potential only). We reject Metro’s contention that the order is not supported by

substantial evidence based solely on the absence of evidence that the Ford-Metro franchise has

actually been terminated.

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 Metro also asserts that certain findings it contends have not been reversed by this

Court preclude the agency from having an “evidentiary base upon which to determine Metro’s claims

for a Sterling franchise should be denied.” Specifically, Metro cites an earlier agency finding that

“‘but for’ the statutory stay, Sterling would have been required to offer Metro a franchise agreement

substantially similar to the franchise agreements provided to other former Texas Ford Heavy Duty

dealers to avoid a possible violation of [occupations code section] 2301.453(b).” This finding,

however, was made during the time period that the agency mistakenly believed it had the authority

to revisit its good-cause determination and had concluded that Ford did not have good cause. But

because the agency was precluded from changing its good-cause determination, it is in fact no longer

the case that Sterling would have been required to offer Metro a franchise “but for” the stay. The

basis for its right to a Sterling franchise—that it is a Ford dealer in good standing—ceased to exist

upon the agency’s determination that Ford had good cause to terminate the franchise. Although that

right might have appeared to have been temporarily revived by the agency’s unauthorized reversal

of its good-cause determination, our opinion in 2008 Metro I made it clear that the apparent revival

of that right derived from unauthorized agency action.

Metro also argues that the 2012 Metro I Order and the 2012 Metro V Order are not

“in accord with” orders the agency previously made in Metro V and that due process requires that

the agency include findings of fact and conclusions of law to show the basis for its now coming to

a different decision. Specifically, Metro asserts that in its February 2005 order, which was the

subject of the Metro V appeal, the agency found that Metro had the authority to transfer its franchise

to a qualified buyer and that the prospective transferee was qualified as a Sterling heavy-duty truck

15
dealer. The agency also ordered the Ford franchise to be transferred to the prospective transferee and

ordered Sterling to provide it with a franchise comparable to that it had issued to other Ford dealers

in good standing. Metro contends that, because these findings were not “reversed” by this Court in

our Metro V opinion, the materially different 2012 Metro V Order must be accompanied by findings

showing the basis for a different decision and those findings must have evidentiary support.

Metro’s argument depends on the erroneous assumption that the Metro V opinion

reversed only the penalty portion of the 2005 Metro V Order. Apparently invoking the concept of

a limited remand discussed in our 2008 Metro I opinion, Metro asserts that because we did not

specifically reverse the other findings in the order, they remain in place after remand. This is simply

not the case. In our 2008 Metro I opinion, we held that in a suit for judicial review, a court may

expressly affirm certain findings and thereby limit the issues the agency is authorized to address on

remand. Any intent to limit the scope of remand, however, must be expressly stated. 2008 Metro I,

255 S.W.3d at 363 n.4. But this is not the same as saying that a court is required, in a general

remand, to expressly reverse all the agency’s findings. Instead, in 2008 Metro I we observed that

a court’s power to limit the remand does not “foreclose a court from remanding an entire

administrative proceeding based on an error in part of the decision challenged on appeal. The court

may find that a single error affected the entire decision-making process such that the agency must

have the opportunity to review the case as a whole.” Id. That is exactly what this Court concluded

in Metro V. Noting that the agency’s mistaken assumption that it had the authority to change the

good-cause-for-termination finding may have affected the agency’s decision in the underlying

proceeding in ways that this Court could not accurately assess, we remanded the cause “based on the

16
effect of the error of law.” Metro V, 255 S.W.3d at 380. This was a general remand, returning the

cause to the agency to review as a whole. The agency was free to enter a new order without

reconsidering the issues regarding the prospective transferee’s qualifications or right to receive a

Sterling franchise. In fact, those issues were no longer material in light of the fact that the agency

was bound by the determination that there was good cause to terminate Metro’s franchise. It

followed from that finding that Metro no longer had a right to receive a Sterling franchise by virtue

of its relationship with Ford and therefore would have nothing to transfer to the prospective

transferee regardless of its qualifications.

Both the 2012 Metro I Order and the 2012 Metro V Order include the following

introductory paragraph:

The Director of the Motor Vehicle Division of the Texas Department of Motor
Vehicles, having duly considered on remand the May 1, 2008, decision of the Court
of Appeals for the Third District of Texas in Sterling Truck Corp. v. Motor Vehicle
Bd. of the Tex. DOT, 255 S.W.3d 368 (Tex. App.—Austin 2008, pet. denied) and the
Court of Appeals’ corresponding December 14, 2009, Mandate; the May 1, 2008,
decision of the Court of Appeals for the Third District of Texas in Freightliner Corp.
v. Motor Vehicle Bd. of the Tex. DOT, 255 SW.3d 356 (Tex. App.—Austin 2008, pet.
denied) and the Court of Appeals’ corresponding December 14, 2009, Mandate; and
the Bankruptcy Court’s October 6, 2010, Order Granting Sterling Truck Company’s
Motion for Relief from Automatic Stay on Final Hearing, does hereby enter this
Interim Order after Remand.

Thus, the agency expressly set forth the basis for both orders—it was issuing the orders required by

this Court’s prior opinions and mandates. The ordering paragraphs include legal conclusions that

follow directly from this Court’s previous rulings. The referenced opinions of this Court and the

bankruptcy court provide the background and the basis for the agency’s orders. We overrule Metro’s

17
second and third appellate issues complaining that the orders were issued without affording it due

process and are not supported by substantial evidence.

CONCLUSION

Having overruled Metro’s three appellate issues, we affirm both the 2012 Metro I

Order and the 2012 Metro V Order.

_____________________________________________

J. Woodfin Jones, Chief Justice

Before Chief Justice Jones, Justices Goodwin and Field

Affirmed

Filed: March 13, 2013

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