Cockrell Inv. Partners v. Middle Pecos Groundwater Conservation Dist.
| Decision Date | 16 February 2023 |
| Docket Number | 08-21-00017-CV |
| Parties | COCKRELL INVESTMENT PARTNERS, L.P., Appellant, v. MIDDLE PECOS GROUNDWATER CONSERVATION DISTRICT, JERRY McGUAIRT in his Official Capacity as President of Middle Pecos Groundwater Conservation District, FORT STOCKTON HOLDINGS, L.P., and REPUBLIC WATER COMPANY OF TEXAS, LLC, Appellees. |
| Court | Texas Court of Appeals |
Appeal from the 112th District Court of Pecos County, Texas (TC# P-12176-112-CV).
Before Rodriguez, C.J., Palafox, and Alley, JJ. Alley, J. (not participating)
Appellant Cockrell Investment Partners, LP (Cockrell), appeals the trial court's judgment, which granted appellees' pleas to the jurisdiction, and dismissed its underlying claims. Appellees are Middle Pecos Groundwater Conservation District (the District), Jerry McGuairt, in his official capacity as president of the District, Fort Stockton Holdings, L.P. (FSH), and Republic Water Company of Texas LLC (Republic). By its suit, Cockrell sought judicial review of the District's order denying it party status to two groundwater permit applications filed by FSH. Although not a party to the applications, Republic was granted party status and it supported issuance of the permits. Additionally Cockrell also sought declaratory relief and ultra vires claims against McGuairt. Appellees all filed pleas to the jurisdiction alleging Cockrell failed to establish a valid waiver of immunity as to each claim. We affirm the trial court's judgment.
The Middle Pecos Groundwater Conservation District is a conservation and reclamation district created under Article XVI, Section 59 of the Texas Constitution. See Tex. Const. art. XVI, § 59. A district of this type operates pursuant to Chapter 36 of the Texas Water Code. Tex. Water Code Ann. §§ 36.001-36.457. Chapter 36 grants such districts authority to regulate the spacing of water wells, the production from water wells, or both. Id. § 36.001(1). In regulating groundwater, the District governs permitting for drilling, equipping, operating, or completing wells. Id. §§ 36.113(a), .114, .401-.418. Generally, the District issues two types of permits: (1) historic and existing use permits (H&E permits); and (2) production permits.
Cockrell owns a property, known as "Belding Farms," located in Pecos County. In 2006, the District granted Cockrell an H&E permit for 16 wells, allowing annual production of 15,528.846-acre feet of groundwater pumping, for the purposes of supplying water and irrigation requirements for a pecan orchard. Cockrell's permit allows annual groundwater pumping from three different aquifers: approximately 1,800-acre feet from the Capitan Reef Aquifer, approximately 7,800-acre feet from the Rustler Aquifer, and 5,880-acre feet from the Edwards-Trinity Aquifer.
Similarly, FSH owns a property in Pecos County, located west of Fort Stockton, covering approximately 18,000 acres of land. In 2005, the District issued an H&E permit to FSH allowing the annual production of 47,418-acre feet of groundwater from the Edwards-Trinity Aquifer, also for agricultural purposes. Cockrell's property and FSH's are located directly adjacent to each other, sharing common boundaries on the north, west, and south sides of Cockrell's property.
Lastly, Republic is a limited liability company doing business in Pecos County, and a lessee of a portion of FSH's groundwater.[1]
On July 13, 2009, FSH submitted to the District a production permit application seeking the right to produce and export 47,418-acre feet of groundwater per year from the Edwards-Trinity Aquifer for municipal and industrial purposes. The District issued public notice of a hearing on the application. Multiple parties appeared to contest and protest FSH's permit application. Several protestants were admitted as parties to the contested hearing that followed on FSH's permit application. Cockrell, however, neither participated in the preliminary hearing or otherwise requested party status to the proceedings.
In 2011, the District denied FSH's application. After exhausting administrative remedies, FSH filed suit against the District in the trial court.[2] The trial court granted summary judgment in favor of the District, affirming its denial of FSH's permit application. Although FSH appealed that ruling to this Court, the parties later entered a settlement and, pursuant to their agreement, they filed a joint motion to vacate the trial court's judgment without regard to the merits and remand to the District for further proceedings, which we granted. See Fort Stockton Holdings, L.P. v. Middle Pecos Groundwater Conservation Dist., No. 08-15-00382-CV, 2017 WL 2570934, at *1 (Tex. App.-El Paso June 14, 2017, no pet.) (mem. op.).
In March 2016, Republic-an entity not involved in FSH's 2009 permit application-filed an application with the District seeking a production permit to produce approximately 28,454-acre feet of groundwater from the same property and wells that FSH had listed in its 2009 application. The District initially granted a motion to abate the application because it concerned the same property and wells as FSH's application, which was then pending appeal. Then, at a subsequent hearing, the District granted a motion declaring Republic's application administratively incomplete, but it also kept the abatement in place. Republic then filed a petition for writ of mandamus against the District in the 112th District Court of Pecos County.[3] In October 2016, the trial court granted the District's plea to the jurisdiction against Republic's petition seeking mandamus relief, which it then appealed to this Court.[4] After the parties again reached a settlement of their dispute, we granted Republic's motion to dismiss the appeal. See Republic Water Co. of Texas, LLC v. Middle Pecos Groundwater Conservation Dist., No. 08-17-00001-CV, 2017 WL 3326784, at *1 (Tex. App.-El Paso Aug. 4, 2017, no pet.) (mem. op.).
On November 15, 2016, the District held a public hearing on Republic's application. At the hearing, the District granted party status to multiple entities including Cockrell. In April 2017, after referral to the State Office of Administrative Hearings, the application was set for a preliminary hearing on May 18, 2017.
In April 2017, the District, FSH, and Republic, collectively reached a settlement agreement. To protect aquifer levels, FSH agreed to modify its 2009 permit application, reducing its request from 47,418-acre feet to 28,400-acre feet, and further agreed to accept other permit conditions that restricted its permit rights. Related to the agreement, FSH also agreed to apply for an amendment of its H&E permit, surrendering 28,400-acre feet of the 47,418-acre feet authorized by that permit. In turn, Republic agreed to withdraw its application, move to dismiss its appeal, and to pay the District its court costs and attorneys' fees for its pending suit. The District and FSH then filed a joint motion to dismiss FSH's appeal then pending in this Court. Fort Stockton Holdings, L.P., 2017 WL 2570934, at *1. This Court granted the motion, vacating the trial court's judgment upholding the District's original denial of FSH's application and remanded the matter back to the District for further proceedings as provided for by the settlement agreement. Id.
As agreed, FSH then submitted an "Amended" permit application to the District. The terms included in the original 2009 application were lined out and replaced with new information. FSH reduced its request for production from 47,418-acre feet to 28,400-acre feet. FSH also filed a second application titled, "Application to Amend H&E Use Permit(s)," requesting a reduction of its original 2005 H&E permit by 28,400-acre feet. For the first time, Cockrell requested party status to "any hearing on [FSH's] Application for Production Permit and Transport Authorization on Remand from the El Paso Court of Appeals," and "any hearing on the Application to Amend Historic and Existing Use Permitted filed by [FSH]."
On July 18, 2017, the District held a hearing on both applications. As to the 2009 application, the meeting minutes reflect the hearing was held following a remand from this Court. As earlier stated, FSH's application sought a permit to produce and beneficially use 28,400-acre feet of Edwards-Trinity Aquifer groundwater from wells on its property for municipal, industrial, or agricultural purposes. Consistent with its written requests, Cockrell appeared and requested party status. Cockrell argued it "[has] a justiciable interest and feels . . . this remand hearing is essentially a new hearing," stating its operation would "obviously" be affected or the proposed permit "could affect" the long-term operation of its own permit. FSH opposed Cockrell's request for party status, stating in relevant part:
1) Cockrell's interest in Belding Farms had notice at the time through mail and other publication, and through personal knowledge since Glenn Honaker was the President of [the District] Board as well as the Manager for Cockrell's Belding Farms. 2) [The District] rule 11.10.4 says that the time to request party status is at the time of the initial hearing and that was more tha[n] 6 years ago. 3) They have offered nothing in the record, and anything offered now would be extra outside of the record. 4) The representation that there is a substantial interest in the permit is over-stated because only about half of their wells are Edwards/Trinity wells. 5) The ruling that the Board has made and has agreed to the settlement agreement will be protective to all the permittees and groundwater...
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