Bexar Metro Water Dist. v. City of Bulverde

• Decision Date: 27 June 2007
• Docket Number: No. 03-06-00447-CV.,03-06-00447-CV.
• Citation: 234 S.W.3d 126
• Parties: BEXAR METROPOLITAN WATER DISTRICT, Appellant, v. CITY OF BULVERDE, Texas; Guadalupe-Blanco River Authority; City of Boerne, Texas; and City of Fair Oaks Ranch, Texas, Appellees.
• Court: Texas Court of Appeals

234 S.W.3d 126

BEXAR METROPOLITAN WATER DISTRICT, Appellant, v. CITY OF BULVERDE, Texas; Guadalupe-Blanco River Authority; City of Boerne, Texas; and City of Fair Oaks Ranch, Texas, Appellees.

No. 03-06-00447-CV.

Court of Appeals of Texas, Austin.

June 27, 2007.

Adolfo Ruiz, San Antonio, for appellant.

C. Robert Heath, Sydney W. Falk, Jr., Bruce E. Wasinger, Bickerstaff, Heath, Smiley, Pollan, Kever & McDaniel, L.L.P., Austin, Jonathan H. Hull, Reagan, Burrus, Dierksen, Lamon & Bluntzer, P.L.L.C., New Braunfels, Frank J. Garza, Davidson & Troilo, P.C., San Antonio, David P. Blanke, Molly Cagle, Vinson & Elkins, L.L.P., Roger P. Nevola, Law Offices of Roger P. Nevola, Austin, for appellee.

Before Justices PATTERSON, PEMBERTON and WALDROP.

OPINION

JAN P. PATTERSON, Justice.

This appeal concerns the effects of changes made in 2003 to appellant Bexar Metropolitan Water District's ("BexarMet") enabling act. Appellees the City of Bulverde and the Guadalupe-Blanco River Authority ("GBRA") sought declaratory judgments from the district court stating that BexarMet could not provide services outside its boundaries, that BexarMet's boundaries are those set out in sections 5 and 5A of its enabling act, and that BexarMet could not annex and incorporate additional area to its territory. On cross-motions for summary judgment, the district court granted summary judgment in favor of Bulverde and GBRA and made the requested declarations. BexarMet appeals contending that the district court did not have jurisdiction over the case and, alternatively, if there is jurisdiction, that the district court's declarations regarding service outside BexarMet's boundaries and BexarMet's authority to annex additional territory were erroneous. Because we conclude that the district court had jurisdiction and that its declarations were correct, we affirm the district court's judgment.

FACTUAL AND PROCEDURAL BACKGROUND

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, and set forth its boundaries using a metes and bounds description that the parties agree was largely understood to coincide with the 1945 city limits of San Antonio. See id. § 5, 1945 Tex. Gen. Laws at 494. The original enabling act allowed BexarMet to expand its boundaries by annexing territory and also provided that BexarMet's boundaries would extend automatically to include any territory annexed into the City of San Antonio. Id. §§ 6, 6a, 1945 Tex. Gen. Laws at 496-97.

On several occasions, BexarMet expanded its service area outside the boundaries defined in its original enabling act. However, rather than using its annexation powers, BexarMet enlarged its territory by obtaining certificates of convenience and necessity ("CCNs") from the Texas Commission on Environmental Quality. As a result of obtaining the CCNs, BexarMet's service area grew to include portions of Atascosa, Comal, and Medina counties.

Although BexarMet's service area expanded, its political boundaries for voting purposes did not. This situation was challenged in federal district court as violating the Voting Rights Act. See Rios v. Bexar Metro. Water Dist., No. SA-96-CA-335 (W.D.Tex. Apr. 22, 1996) (judgment). The parties settled the case and submitted a proposed consent decree to the federal court. The court adopted the consent decree and ordered, pursuant to the decree, that BexarMet's boundaries coincide strictly with the geographic areas in which BexarMet provides water service.

In 2003, the Texas legislature amended BexarMet's enabling act by passing Senate Bill 1494. See Act of June 18, 2003, 78th Leg., R.S., ch. 375, 2003 Tex. Gen. Laws 1593 ("SB 1494"). Changes were made to the sections of the enabling act addressing BexarMet's powers, boundaries, and authority to annex. In conformity with the federal court's judgment in the Rios case, SB 1494 clarified that BexarMet's boundaries included the territories for which BexarMet had obtained CCNs. See id. § 3, sec. 5A(b), 2003 Tex. Gen. Laws at 1596.

In December 2003, Bulverde and GBRA filed this lawsuit seeking declaratory judgments related to BexarMet's boundaries and powers after passage of SB 1494. BexarMet responded by filing a plea to the jurisdiction, which the district court denied. BexarMet then filed an interlocutory appeal with this Court challenging the district court's ruling on jurisdiction. See Tex. Civ. Prac. & Rem.Code Ann. § 51.014(a)(8) (West Supp.2006). This Court affirmed the district court's ruling. Bexar Metro. Water Dist. v. City of Bulverde, 156 S.W.3d 79, 91 (Tex.App.-Austin 2004, pet. denied).

On remand, BexarMet again filed a plea to the jurisdiction asserting changed circumstances, but the district court overruled the plea. The parties filed cross-motions for summary judgment, and the district court granted Bulverde's and GBRA's motion and denied BexarMet's motion. The court entered a final judgment that included the following declarations: (1) BexarMet cannot provide service outside its statutory boundaries; (2) BexarMet's statutory boundaries for services other than retail water utility services are set out in section 5 of BexarMet's enabling act and its statutory boundaries for retail water utility services are set out in section 5A(b) of BexarMet's enabling act; and (3) BexarMet has no authority to annex and incorporate additional area to its territory. This appeal by BexarMet followed.

ANALYSIS

BexarMet raises two issues on appeal: (1) the district court should not have reached the merits of this case because the court lacked jurisdiction, and (2) the district court erroneously concluded that SB 1494 precludes BexarMet from expanding its service area or political boundaries.

Jurisdiction

Whether a court has subject matter jurisdiction is a question of law subject to de novo review. Texas Natural Res. Conservation Comm'n v. IT-Davy, 74 S.W.3d 849, 855 (Tex.2002). In performing this review, an appellate court does not look to the merits of the case but considers only the pleadings and evidence relevant to the jurisdictional inquiry. County of Cameron v. Brown, 80 S.W.3d 549, 555 (Tex. 2002). The plaintiff has the burden of alleging facts to affirmatively demonstrate that the trial court has jurisdiction. Texas Dep't of Parks & Wildlife v. Miranda, 133 S.W.3d 217, 226 (Tex.2004).

A declaratory judgment action does not vest a court with jurisdiction "to pass upon hypothetical or contingent situations, or to determine questions not then essential to the decision of an actual controversy, although such questions may in the future require adjudication." Firemen's Ins. Co. v. Burch, 442 S.W.2d 331, 333 (Tex.1968). A declaratory judgment is appropriate only if a justiciable controversy exists as to the rights and status of the parties and the controversy will be resolved by the declaration sought. Bonham State Bank v. Beadle, 907 S.W.2d 465, 467 (Tex.1995). A controversy is considered justiciable if there exists a real and substantial controversy involving a genuine conflict of tangible interests and not merely a theoretical dispute. Id.

The issue of jurisdiction is before this Court for the second time. In the interlocutory appeal, BexarMet argued that no jurisdiction existed because GBRA and Bulverde were only competitors of BexarMet and, thus, lacked standing to challenge BexarMet's ability to act. See, e.g., English v. Landa Motor Lines, 166 S.W.2d 721, 723 (Tex.Civ.App.-Austin 1942, writ ref'd w.o.m.). This Court rejected that argument, concluding that GBRA and Bulverde were not mere competitors. Bexar Metro. Water Dist., 156 S.W.3d at 87-88. BexarMet now urges that, due to changed circumstances, GBRA and Bulverde are mere competitors and now lack standing to maintain this cause of action.

In the interlocutory appeal, this Court observed that "there are cases suggesting that a competitor, without more, lacks standing to challenge the actions of its competitor." Id. at 87. But, for two reasons, we determined that this prohibition did not apply to this case. First, GBRA was not a mere competitor. BexarMet had filed a petition with the TCEQ to compel GBRA to provide BexarMet with 3,000 acre-feet of water per year, and GBRA therefore had "a larger stake in the outcome of this case than as a mere competitor." Id. Second, both Bulverde and GBRA were "parties affected by the actions of BexarMet." Id. at 88. When a governmental authority's actions are void, as opposed to voidable, the actions can be challenged by affected parties. Id. (citing City of Irving v. Callaway, 363 S.W.2d 832, 834 (Tex.Civ.App.-Dallas 1962, writ ref'd n.r.e.)). We concluded that Bulverde and GBRA were affected parties because BexarMet was seeking to provide water-utility service in an area served by Bulverde and seeking to compel GBRA to provide water to BexarMet. Id. BexarMet contends that these bases for standing are now moot because BexarMet has withdrawn its petition to compel water from GBRA, cancelled the planned acquisition of four water systems in Comal County, and withdrawn its application at the TCEQ seeking approval of the planned acquisition of the four water systems.

The mootness doctrine requires that courts avoid rendering advisory opinions by only deciding cases that present a "live" controversy at the time of the decision. Camarena v. Texas Employment Comm'n, 754 S.W.2d 149, 151 (Tex.1988). A case becomes moot when: (1) it appears that one seeks to obtain a judgment on some controversy, when in reality none exists; or (2) when one seeks a judgment on some matter which, when rendered for any reason, cannot have any practical legal effect on a then-existing controversy. Texas Health Care Info. Council v. Seton Health Plan, 94 S.W.3d 841,...