El Paso Comm. v. B & G/Sunrise Joint Ven.

• Decision Date: 27 July 2000
• Citation: 24 S.W.3d 620
• Parties: (Tex.App-Austin 2000) El Paso Community Partners, Appellant v. B&G/Sunrise Joint Venture; The California Sierra Group Corp.; Garry P. Mauro, Individually and in his capacity as former Commissioner of General Land Office; William F. Warnick, Individually and in his capacity as member of State Land Board; C. Louis Renaud, Individually and in his capacity as member of State Land Board; and David Dewhurst, in his capacity as Commissioner of the General Land Office, Appellees NO. 03-99-00488-CV
• Court: Texas Court of Appeals

Page 620

24 S.W.3d 620 (Tex.App-Austin 2000)

El Paso Community Partners, Appellant v. B&G/Sunrise Joint Venture; The California Sierra Group Corp.; Garry P. Mauro, Individually and in his capacity as former Commissioner of General Land Office; William F. Warnick, Individually and in his capacity

as member of State Land Board; C. Louis Renaud, Individually and in his capacity as member of State Land Board; and David Dewhurst, in his capacity as Commissioner of the General Land Office, Appellees

NO. 03-99-00488-CV

TEXAS COURT OF APPEALS, THIRD DISTRICT, AT AUSTIN

July 27, 2000

Rehearing Overruled August 10, 2000

Rehearing For Publication August 31, 2000

FROM THE DISTRICT COURT OF TRAVIS COUNTY, 200TH JUDICIAL DISTRICT NO. 98-12781, HONORABLE SUZANNE COVINGTON, JUDGE PRESIDING

Before Chief Justice Aboussie, Justices Kidd and B. A. Smith

MARILYN ABOUSSIE, Chief Justice.

Appellant El Paso Community Partners filed suit against appellees¹ seeking, among other things, that the district court declare void a purchase contract for the sale of state lands between B&G/Sunrise Joint Venture (B&G) and the State of Texas. Appellant alleged that a material and substantial variance between the State's bid specifications and the contract awarded rendered the contract void or invalid. Concluding that appellant lacked standing to challenge the validity of the contract, the district court granted appellees' plea to the jurisdiction and motion to dismiss the cause with prejudice. We will affirm.

BACKGROUND

Although this case turns solely on a question of law, we will summarize the facts to provide context. The State of Texas Permanent School Fund owned over 4,000 acres of land in eastern El Paso County. The School Land Board, acting through the General Land Office and its then-Commissioner Garry Mauro, decided to sell the property via a competitive bid process.

Appellant was one of four entities that met qualifications and submitted a purchase bid under the option method. The bid solicitation provided that a "bid must include a firm contract amount and other material terms. Other elements of the contract will be subject to negotiation." (Emphasis added.) Appellant bid $66,704,966. Appellee B&G bid $67,055,000. The School Land Board, acting through appellees Mauro, William F. Warnick, and C. Louis Renaud, selected B&G as the winning bidder. After further negotiations, B&G and the State signed a contract on August 28, 1998.

In November 1998, appellant filed suit alleging that the contract "deviated materially" from the bid solicitation. B&G filed special exceptions, which the trial court granted. Appellant amended its allegations and in its third amended petition sought declarations that: (1) Mauro lacked authority to sign the contract; (2) Warnick and Renaud were acting outside the scope of their authority in consenting to Mauro's signing of the contract; (3) Mauro's successor, appellee David Dewhurst, lacked authority to continue to negotiate the contract; (4) B&G's bid was invalid and deemed rejected; and (5) the contract and deeds executed thereunder were void. Appellant did not allege fraud, collusion, or irregularities in the solicitation or bidding process.

Appellees filed a plea to the jurisdiction and a motion to dismiss with prejudice. In its order dismissing appellant's suit, the district court stated, "The Court finds that Plaintiff El Paso Community Partners does not have standing to seek the voiding of the contract, at issue in this suit . . . ." After the trial court denied its motion for new trial, appellant brought this appeal.

DISCUSSION

In its sole issue, El Paso Community Partners contends that the contract entered into between the State and B&G is materially different than that for which bids were solicited and that under these circumstances, appellant, as a qualified bidder, has standing to challenge the validity of the contract entered into between the State and the highest bidder.

Standing is an element of a court's subject matter jurisdiction. See Texas Ass'n of Bus. v. Texas Air Control Bd., 852 S.W.2d 440, 444-45 (Tex. 1993). The plaintiff has the burden of alleging facts that affirmatively demonstrate a court's jurisdiction to hear a cause. See id. at 446. A plea to the jurisdiction challenges a trial court's authority to hear a case by alleging that the factual allegations in the plaintiff's pleadings, when taken as true, fail to invoke the trial court's jurisdiction. See Bybee v. Fireman's Fund Ins. Co., 331 S.W.2d 910, 917 (Tex. 1960); Firemen's Ins. Co. v. Board of Regents of the Univ. of Tex. Sys., 909 S.W.2d 540, 541 (Tex. App.--Austin 1995, writ denied). Dismissing a cause of action based on a plea to the jurisdiction is proper only when incurable jurisdictional defects are shown on the face of plaintiff's pleadings. See Curbo v. State, 998 S.W.2d 337, 341 (Tex. App.--Austin 1999, no pet.); Flowers v. Lavaca County Appraisal Dist., 766 S.W.2d 825, 827 (Tex. App.--Corpus Christi 1989, writ denied).

Because the question of standing is a legal question, we review de novo a trial court's ruling on a plea to the jurisdiction. See Mayhew v. Town of Sunnyvale, 964 S.W.2d 922, 928 (Tex. 1998); Board of Regents, 909 S.W.2d at 542. In reviewing a trial court order dismissing a cause based on a plea to the jurisdiction, we "construe the pleadings in favor of the plaintiff and look to the pleader's intent." Texas Air Control Bd., 852 S.W.2d at 446; Pearce v. City of Round Rock, 992 S.W.2d 668, 671 (Tex. App.--Austin 1999, pet. denied).

As a general rule, to demonstrate standing a party must allege some interest peculiar to it individually and not as a member of the general public. See Hunt v. Bass, 664 S.W.2d 323, 324 (Tex. 1984); Lake Medina Conservation Soc., Inc./Bexar-Medina Atascosa Counties WCID No. 1 v. Texas Natural Resource Conservation Comm'n, 980 S.W.2d 511, 515 (Tex. App.--Austin 1998, pet. denied). Specifically, a plaintiff has standing to sue if: (1) the plaintiff has sustained, or is immediately in danger of sustaining, some direct injury as a result of the complained-of wrongful act; (2) there is a direct relationship between the alleged injury and the claim to be adjudicated; (3) the plaintiff has a personal stake in the controversy; (4) the challenged action has caused the plaintiff some injury in fact, either economic, recreational, environmental, or otherwise; or (5) the plaintiff is an appropriate party to assert the public interest in the matter as well as the plaintiff's own interest. See Lake Medina, 980 S.W.2d at515-16; Billy B., Inc. v. Board of Trustees, 717 S.W.2d 156, 158 (Tex. App.--Houston [1st Dist.] 1986, no writ); Housing Auth. v. State ex rel. Velasquez, 539 S.W.2d 911, 913-14 (Tex. Civ. App.--Corpus Christi 1976, writ ref'd n.r.e.). An exception to this general rule allows "a taxpaying citizen to maintain an action in a court of equity to enjoin public officials from expending public funds under a contract that is void or illegal." Osborne v. Keith, 177 S.W.2d 198, 200 (Tex. 1944); see Texas State Employees Union/C.W.A. Local 6184 v. Texas Workforce Comm'n, 16 S.W.3d 61, 68 (Tex. App.--Austin 2000, no pet.). This exception is limited to instances in which the contract is illegal or void and not merely voidable at the option of the public official. See Osborne, 177 S.W.2d at 200.

Taxpayer Standing to Enjoin Performance of Void or Illegal Contract

Appellant's petition sought declarations that the State's agents were acting without authority and that the contract was void because it did not contain a final takedown schedule as the bid specifications required.² Appellant contended that the State's signing the contract was therefore illegal and that the contract was void under the terms of the solicitation. We first examine the relevant sections of the solicitation to determine whether appellant can meet the requirements for standing under the exception discussed in Osborne v. Keith. See id.

Appellant argues that because the contract did not contain a takedown schedule, appellees failed to reach a final agreement as required by the solicitation and that the contract was therefore void according to the terms of the solicitation. Taking as true appellant's factual allegations that the takedown schedule did not comply with the terms of the solicitation, we look to see whether the terms of the solicitation prohibited the parties from continuing to negotiate if they failed to reach an agreement by a certain date.

Appellant quotes two sections of the solicitation to support its position that the parties were required to reach a final agreement by a certain date. One section provides:

The winning Bidder shall have 45 days, beginning on the date of the bid award, to agree with the State on the language of the final purchase or option Contract. The SLB, at its option, may extend this period of time. If no contract has been finalized by the end of that period the State may reject the bid and keep the Property or dispose of the Property in any lawful manner.

The solicitation finally states:

If the winning Bidder and the State fail to negotiate a contract in the time-frame required, then $25,000 of the Earnest Money on deposit shall be forfeited to the State; and the Property may be re-bid at a later date or otherwise disposed of in accordance with applicable law.

Appellant did not allege that the solicitation was ambiguous. Therefore, we construe the solicitation, as we would any other document, according to its plain meaning. See Northern Natural Gas Co. v. Conoco, Inc., 986 S.W.2d 603, 606 (Tex. 1998) (interpreting contract according to its plain meaning).

The first quoted paragraph guarantees the winning bidder at least forty-five days in which to negotiate an agreement and provides that the State at its discretion may grant the winning bidder more time. It does not limit the number or length of extensions that the State may grant. The last quoted paragraph...