Subaru of America v. David Mcdavid Nissan

Decision Date27 June 2002
Docket NumberNo. 00-0292.,00-0292.
Citation84 S.W.3d 212
PartiesSUBARU OF AMERICA, INC., Petitioner, v. DAVID McDAVID NISSAN, INC. d/b/a David McDavid Subaru, Respondent.
CourtTexas Supreme Court

Bruce C. Morris, Wm. Bruce Stanfill, Jeffrey T. Nobles, Diane M. Guariglia, Beirne Maynard & Parsons, Houston, for Petitioner.

Stephen A. Khoury, Robert L. Kelsoe, Kelsoe Anderson & Khoury, Dallas, for Respondent.

Justice BAKER delivered the opinion of the Court.

On December 6, 2001, we granted Subaru's motion for rehearing. We withdraw our opinion and judgment dated May 31, 2001, and substitute the following in its place.

This case involves the interrelation between a trial court's original jurisdiction and the Texas Motor Vehicle Board's original jurisdiction under the Texas Motor Vehicle Commission Code.1 The court of appeals held that the Legislature's granting exclusive jurisdiction to the Board abrogates a party's common-law claims, and therefore, the Code unconstitutionally denies a citizen's access to the courts. 10 S.W.3d 56, 67-68. We agree that the Code confers exclusive jurisdiction on the Board to initially resolve the claims and issues the Code governs. But we do not agree that the Code abrogates any common-law claims here. Accordingly, we affirm the court of appeals' judgment in part, reverse the court of appeals' judgment in part, and remand the claims to the trial court for further proceedings.


David McDavid Nissan owned two Houston car dealerships along the Gulf Freeway. Its Oldsmobile dealership was located inside Loop 610 at 6800 Gulf Freeway; eight miles farther south stood its Subaru dealership, outside Loop 610 at 11200 Gulf Freeway. In 1991, McDavid discussed its desire to switch the two dealerships' locations with Subaru's regional vice-president, John Gage. Although McDavid alleges that Gage orally consented to the relocation, McDavid did not submit a written request to relocate. Instead, relying on Gage's alleged oral assurances, McDavid renovated the more-southern location, moved the Oldsmobile dealership there, and prepared to move the Subaru dealership inside the Loop.

On November 6, 1991, Gage sent McDavid a letter stating that Subaru had just learned that McDavid planned to relocate its Subaru dealership and that Subaru would not consent to the move. The letter stated that Subaru would not allow any Subaru franchise to move inside Loop 610. Concerned about its deteriorating relationship with Subaru, McDavid closed its Houston Subaru dealership as well as its Plano and Irving Subaru dealerships. Following the Code's procedure for voluntary-termination benefits, Subaru repurchased certain assets from the dealership and paid McDavid accordingly. The next year, Subaru allowed another dealership to relocate inside the Loop — on the lot adjoining McDavid's proposed site. McDavid then sued Subaru for refusing to allow McDavid to relocate. McDavid alleged Subaru violated the Code provision making unlawful a manufacturer's unreasonably denying a dealership-relocation application. TEX. REV.CIV. STAT. art. 4413(36), § 5.02(b)(15). McDavid also claimed Subaru violated the Texas Deceptive Trade Practices Act and breached its written dealership agreement, its oral agreement, and its duty of good faith and fair dealing.

Between January 1996 and March 1996, Subaru filed three summary-judgment motions, seeking to dismiss all McDavid's claims. Subaru asserted McDavid did not raise its claims before the Board and, consequently, could not bring these claims in court. Subaru further claimed McDavid had elected its remedy by terminating the dealership and accepting voluntary-termination benefits. Subaru also raised various other grounds for dismissing McDavid's contract, DTPA, and bad-faith claims.

Before the trial court ruled on these motions, McDavid filed a supplemental petition asserting that Subaru was "equitably estopped" from denying its oral agreement with McDavid. McDavid also responded to Subaru's summary-judgment motion. Without stating the grounds, the trial court granted a partial summary judgment, specifically excepting only McDavid's promissory-estoppel claim. Subaru filed another summary-judgment motion, claiming that the accord and satisfaction doctrine barred all McDavid's claims and again alleging that McDavid did not exhaust its administrative remedies. Subaru further asserted that promissory estoppel is not a cause of action. In response, McDavid argued that an exhaustion of remedies requirement would violate its constitutional right to a jury trial and open courts. The trial court granted Subaru's summary-judgment motion.

The court of appeals reversed the trial court's judgment in part. The court affirmed the trial court's order dismissing McDavid's DTPA claim and its "Code claim" for breach of written agreement, because these claims fall within the Board's primary jurisdiction. 10 S.W.3d at 69, 72. But the court of appeals remanded McDavid's common-law breach of oral contract claims. The court of appeals explained that remanding the oral contract claims was necessary because section 3.01(b), which states that "all aspects of the distribution and sale of motor vehicles shall be governed exclusively by the provisions of this Act," abrogated McDavid's common-law claims and, consequently, violated the Texas Constitution's open courts provision. 10 S.W.3d at 67-68. The court also concluded that, though McDavid's bad-faith claim is statutorily created, the Code did not require McDavid to first present this claim to the Board. 10 S.W.3d at 69-70.

Subaru petitioned this Court for review. We granted Subaru's petition to determine the Board's jurisdiction over McDavid's claims. At the time the trial court and court of appeals considered this issue, section 3.01 of the Code provided:

(a) The board has the general and original power and jurisdiction to regulate all aspects of the distribution, sale, and leasing of motor vehicles and to do all things, whether specifically designated in this Act or implied herein, or necessary or convenient to the exercise of this power and jurisdiction, including the original jurisdiction to determine questions of its own jurisdiction. In addition to the other duties placed on the board by this Act, the board shall enforce and administer the terms of Chapter 503, Transportation Code.

(b) Unless otherwise specifically provided by Texas law not in conflict with the terms of this Act, all aspects of the distribution and sale of motor vehicles shall be governed exclusively by the provisions of this Act.

TEX.REV.CIV. STAT. art. 4413(36), § 3.01 (Vernon Supp.1998), amended by Act of May 18, 2001, 77th Leg., R.S., ch. 155, § 5, 2001 Tex. Gen. Laws 313, 317.

In our original opinion, we concluded that section 3.01(a) conferred primary — not exclusive — jurisdiction on the Board to resolve certain Code issues raised in McDavid's claims. Further, we concluded that section 3.01(b) does not grant the Board exclusive jurisdiction because, by its plain language, that subsection only establishes that the Code governs this area of law and trumps other laws if they conflict with the Code.

However, less than two weeks before we issued our opinion, the Legislature amended section 3.01(a) to provide:

(a) The board has the exclusive, original jurisdiction to regulate those aspects of the distribution, sale, and leasing of motor vehicles as governed by this Act and to do all things, whether specifically designated in this Act or implied herein, or necessary or convenient to the exercise of this power and jurisdiction, including the original jurisdiction to determine questions of its own jurisdiction.

TEX.REV.CIV. STAT. art. 4413(36), § 3.01(a) (emphasis added). The Legislature made this amended provision "effective immediately" after receiving the necessary votes, which occurred on May 18, 2001. See Act of May 18, 2001, 77th Leg., R.S., ch. 155, § 5, 2001 Tex. Gen. Laws 313, 327. The Legislature did not change section 3.01(b). We were not informed about the amendment until Subaru filed its motion for rehearing.

We granted Subaru's motion for rehearing to determine: (1) whether section 3.01's current or former version applies, and (2) whether the applicable provision grants the Board primary or exclusive jurisdiction.


The Texas Constitution states that "[n]o bill of attainder, ex post facto law, retroactive law, or any law impairing the obligation of contracts, shall be made." TEX. CONST. art. I, § 16. A retroactive law literally means a law that acts on things which are past. DeCordova v. City of Galveston, 4 Tex. 470, 475 (Tex.1849). However, not all statutes that apply retroactively are constitutionally prohibited. A retroactive statute only violates our Constitution if, when applied, it takes away or impairs vested rights acquired under existing law. Ex parte Abell, 613 S.W.2d 255, 260 (Tex.1981); McCain v. Yost, 155 Tex. 174, 284 S.W.2d 898, 900 (1955). A vested right is a property right, which the Constitution protects like any other property. Middleton v. Texas Power & Light Co. 108 Tex. 96, 185 S.W. 556, 560 (1916). However,

[t]hat no one has a vested right in the continuance of present laws in relation to a particular subject, is a fundamental proposition; it is not open to challenge. The laws may be changed by the Legislature so long as they do not destroy or prevent an adequate enforcement of vested rights. There cannot be a vested right, or a property right, in a mere rule of law.

Middleton, 185 S.W. at 560.

Courts generally presume that the Legislature intends a statute or amendment to operate prospectively and not retroactively. Abell, 613 S.W.2d at 258; Blonstein v. Blonstein, 831 S.W.2d 468, 472 (Tex.App.-Houston [14th Dist.] 1992,...

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