Chambers-Liberty Counties Navigation Dist. v. State

• Citation: 575 S.W.3d 339
• Decision Date: 10 May 2019
• Docket Number: No. 17-0365, No. 17-0404,17-0365
• Parties: CHAMBERS–LIBERTY COUNTIES NAVIGATION DISTRICT, et al., Petitioners, v. STATE of Texas, Respondent In re Sustainable Texas Oyster Resource Management, L.L.C., Relator
• Court: Texas Supreme Court

575 S.W.3d 339

CHAMBERS–LIBERTY COUNTIES NAVIGATION DISTRICT, et al., Petitioners,

v.STATE of Texas, Respondent

In re Sustainable Texas Oyster Resource Management, L.L.C., Relator

No. 17-0365

No. 17-0404

Supreme Court of Texas.

Argued January 23, 2019

OPINION DELIVERED: May 10, 2019

Justice Blacklock delivered the opinion of the Court.

This appeal pits two government entities asserting influence over oyster production in and around Galveston Bay. The Chambers–Liberty Counties Navigation District ("District") leased submerged land to Sustainable Texas Oyster Resource Management, L.L.C., ("STORM") for oyster production. The State of Texas sued the District and STORM, seeking to invalidate the lease under the theory that Texas law affords the Texas Parks and Wildlife Department ("Department"), not the District, the sole power to decide who may and may not cultivate oysters in the disputed area. The State also sought monetary relief against both defendants under sections 12.301 and 12.303 of the Parks and Wildlife Code.

This is an interlocutory appeal arising from the District's plea to the jurisdiction, and we must once again navigate the turbulent waters of governmental immunity. The court of appeals allowed the State's money-damages claims and its ultra vires claims to proceed. We conclude that immunity bars the State's claim for monetary relief against the District but does not bar its ultra vires claim that the District's officers exceeded their authority by entering into the oyster lease. We therefore reverse the judgment of the court of appeals in part and affirm in part. We also deny a related mandamus petition.

I. Background

A. Facts

The Legislature created the Chambers–Liberty Counties Navigation District in 1944. The District operated as a navigation district authorized by Article XVI, Section 59 of the Texas Constitution (entitled " Article XVI, Section 59, Navigation Districts") and Chapter 62 of the Texas Water Code. In 1974, the District converted into a "self-liquidating district" operating under Chapter 63 of the Water Code. See TEX. WATER CODE § 63.021(a) ("All navigation districts organized under the provisions of Article XVI, Section 59, of the Texas Constitution, and the provisions of Chapter 62 of this code ... are self-liquidating in character ...."); id. § 63.022 ("A [self-liquidating] district ... may be created ... to operate under the provisions of Article XVI, Section 59, of the Texas Constitution.").

In 1957 and 1967, the State of Texas conveyed to the District by General Land Office patent more than 23,000 acres of submerged land in and around Galveston Bay. The submerged land contains areas suitable for oyster cultivation. These conveyances were authorized by TEX. REV. CIV. STATS. ANN. art. 8225 (1925), which stated in part:

Any Navigation District heretofore or hereafter organized under this title or any General Law under which said subdivision may be created shall have the right to purchase from the State of Texas any lands and flats belonging to said State, covered or partly covered by the waters of any of the bays or other arms of the sea to be used by said District for the purposes authorized by law with the right to dredge out or to fill in and reclaim said lands or otherwise improve the same ....

In 2014, the District's Commissioners authorized the District to lease most of its submerged land to STORM to cultivate, harvest, and store oysters. The District and STORM executed a lease ("Lease"), which states:

[STORM] is granted the rights to use and possession, and to protect against trespass and trespassers, which includes but is not limited to the right to deposit rock, shell or other material used to create an oyster bed, the right to use boats, equipment and tools to plant, seed, transplant, cultivate, store or harvest oysters, and the right to mark any private oyster bed (with stakes, pipes, buoys, etc.) and post signs warning the public not to interfere with or damage the oyster bed or take any oyster, rock, shell or thing from the oyster bed; and further includes any applicable littoral or riparian right of the District appurtenant to the Land for the stated purpose and use of this Lease and the exercise of the rights granted to [STORM] in this Lease.

The Lease covered approximately 23,000 acres. STORM pursued the construction of oyster beds. It also sent "No Trespass" notices to holders of oyster-production permits, known as "certificates of location," issued by the Department to other oyster producers. The certificates covered locations within the Lease. These certificates authorize their holder "to plant oysters and make a private oyster bed in the public water of the state." TEX. PARKS & WILD. CODE § 76.006(a). STORM's position was that, despite the Department's issuance of certificates of location to other private oyster farmers, STORM had the exclusive right to seed and harvest oysters within the property covered by the Lease. In addition to the right to post "No Trespassing" signs, the Lease purported to grant STORM the right "to protect the Land, each oyster bed location on the Land and the oysters or material thereon, against trespass and trespassers in the same manner as a freeholder of the Land or oyster bed location." STORM and the District interpret the Lease to give STORM the exclusive right to farm oysters on the land covered by the Lease. The assertion of this right is based on the District's position that it owns the submerged land in fee simple and therefore had the right to convey by lease the authority to cultivate and harvest oysters on the submerged land. The District does not dispute that the waters above the submerged land are property of the State, as section 11.021 of the Water Code provides.¹ Nor does the District dispute that the oysters themselves are personal property of the oyster permit holder by virtue of section 76.035 of the Parks and Wildlife Code.² Instead, the District claims that its fee simple ownership of the submerged land and its broad, general statutory authority empower it to lease the submerged land for oyster cultivation.

B. Trial Court Proceedings

The State of Texas sued the District, its Commissioners in their official capacities, and STORM. The State alleged that the Lease is void because it exceeds the lawful authority of the District and Commissioners, who acted ultra vires by entering into it. The State sought a declaratory judgment to that effect. The State also sought monetary damages, which it described as "restitution," from the District and STORM under sections 12.301 and 12.303 of the Parks and Wildlife Code. Section 12.301 states:

A person who kills, catches, takes, possesses, or injures any fish, shellfish, reptile, amphibian, bird, or animal in violation of this code or a proclamation or regulation adopted under this code is liable to the state for the value of each fish, shellfish, reptile, amphibian, bird, or animal unlawfully killed, caught, taken, possessed, or injured.

TEX. PARKS & WILD. CODE § 12.301. Section 12.303(a) states:

The attorney general or the county attorney of the county in which the violation occurred may bring a civil suit under this subchapter in the name of the state to recover the value of each fish, shellfish, reptile, amphibian, bird, or animal unlawfully killed, caught, taken, possessed, or injured.

Id. § 12.303(a). The District and the Commissioners filed a plea to the jurisdiction and a motion to dismiss under Texas Rule of Civil Procedure 91a, asserting that the District's immunity from suit bars the State's claims. The trial court denied the plea and the motion.

C. Proceedings in the Court of Appeals

The District and its Commissioners brought an interlocutory appeal of the order denying their plea to the jurisdiction and motion to dismiss. See TEX. CIV. PRAC. & REM. CODE § 51.014(a)(8). The court of appeals reversed the portion of the trial court's order that permitted the State to pursue an ultra vires claim against the District itself. 565 S.W.3d 1 (Tex. App.—Austin 2016). It otherwise affirmed the denial of the plea to the jurisdiction. The court of appeals held that the State could pursue a claim against the District for money damages under the Parks and Wildlife Code. It held that the State could not pursue ultra vires claims against the District itself but could pursue such claims against the Commissioners in their official capacity. The court of appeals concluded that the Lease exceeds the Commissioners' lawful authority and that the State therefore pleaded a viable ultra vires claim against the Commissioners. STORM did not participate in the interlocutory appeal as a party and did not request party status. Nor did it seek mandamus relief in the court of appeals. Its only participation in the court of appeals was to submit an amicus curiae brief in support of the District's motion for rehearing.

D. Proceedings in the Supreme Court

The District and Commissioners³ filed a petition for review in Case No. 17-0365. STORM also a filed a petition for review in Case No. 17-0365, arguing that it should be allowed to participate as a party under the doctrine of virtual representation. STORM separately filed a petition for writ of mandamus in Case No. 17-0404, raising the same substantive arguments regarding the validity of the Lease that it raised in its petition for review.

II. Analysis

A. Governmental Immunity

Sovereign immunity protects the State of Texas and its agencies from suit and liability, whereas governmental immunity provides similar protections to the State's political subdivisions. Travis Cent. Appraisal Dist. v. Norman , 342 S.W.3d 54, 57–58 (Tex. 2011). The parties do not dispute that the District is a political subdivision of the State for immunity purposes. Governmental immunity therefore bars suits against the District unless the Legislature has waived the District's immunity. Hall v. McRaven , 508 S.W.3d 232, 238 (Tex. 2017) ; Tooke v. City of Mexia , 197 S.W.3d 325, 332–33 (Tex. 200...