Travis County v. Pelzel & Assoc.

• Decision Date: 19 October 2000
• Parties: (Tex.App.-Austin 2000) Travis County, Texas, Appellant v. Pelzel & Associates, Inc., Appellee NO. 03-99-00862-CV
• Court: Texas Court of Appeals

Page 662

30 S.W.3d 662 (Tex.App.-Austin 2000) Travis County, Texas, Appellant
v.
Pelzel & Associates, Inc., Appellee NO. 03-99-00862-CV TEXAS COURT OF APPEALS, THIRD DISTRICT, AT AUSTIN October 19, 2000
Rehearing Overruled November 30, 2000.

FROM THE DISTRICT COURT OF TRAVIS COUNTY, 126TH JUDICIAL DISTRICT NO. 95-12465, HONORABLE ERNEST C. GARCIA, JUDGE PRESIDING

Page 663

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

Bea Ann Smith, Justice.

Appellant Travis County contracted with appellee Pelzel & Associates, Inc. (Pelzel) to construct the Precinct One Office Building. Travis County refused to tender full payment complaining that the completion was twenty-one days overdue. Pelzel sued Travis County for payment due under the

Page 664

contract, interest, and damages. After a hearing to determine whether Travis County was entitled to sovereign immunity, the judge denied the county's plea to the jurisdiction. We will affirm the trial court's ruling, holding first, that Travis County waived its immunity by its conduct, and second that independent of the county's conduct, Pelzel's compliance with section 89.004 conferred the right to bring this suit. See Tex. Loc. Gov't Code Ann. § 89.004 (West Supp. 2000).¹

FACTUAL AND PROCEDURAL BACKGROUND

On March 22, 1994, Travis County entered into a contract with Pelzel for construction of the Precinct One Office Building. Pelzel substantially completed the building on December 29, 1994. Travis County accepted the building and has occupied the property since that date. The county tendered payment of $414,164.80 minus $5,500 in alleged liquidated damages on grounds that Pelzel did not timely complete the building. According to the liquidated damages clause in the contract, the county was entitled to retain $250 for each calendar day that Pelzel failed to substantially complete the building beyond the date set for completion and acceptance. The substantial completion date was originally set for October 21, but the parties agreed to extend the deadline because of delays resulting from labor shortages in the Austin and San Antonio areas. The parties now dispute the extended deadline for substantial completion. A construction change directive signed by the county's representative and the architect, but not by Pelzel, established the substantial completion date as December 8, 1994. Pelzel, however, said it never agreed to or acknowledged this directive.

Pelzel submitted a claim to the Travis County Commissioners Court on March 7, 1995, seeking payment due under the contract, plus interest and $130,508.56 in hindrance and delay damages. When the county refused to pay the claim, Pelzel filed this suit on October 3, 1995. Travis County filed a plea to the jurisdiction asserting sovereign immunity. The district court denied that plea, and Travis County brings an interlocutory appeal from that ruling. See Tex. Civ. Prac. & Rem. Code Ann. § 51.014(a)(8) (West Supp. 2000).

DISCUSSION

Travis County asserts that the district court erred in denying its plea to the jurisdiction. A county is a governmental unit protected by the doctrine of sovereign immunity. Tex. Civ. Prac. & Rem. Code Ann. § 101.001(3)(B) (West Supp. 2000); San Antonio Indep. Sch. Dist. v. McKinney, 936 S.W.2d 279, 283 (Tex. 1996). Sovereign immunity includes two principles that protect the State and other governmental entities from being sued for damages: immunity from liability and immunity from suit. Federal Sign v. Texas S. Univ., 951 S.W.2d 401, 405 (Tex. 1997). Immunity from liability, which protects the State from judgment, does not affect a court's jurisdiction to hear a case. Davis v. City of San Antonio, 752 S.W.2d 518, 520 (Tex. 1988). However, immunity from suit deprives a court of subject matter jurisdiction and is properly asserted by a plea to the jurisdiction. Texas Dep't of Transp. v. Jones, 8 S.W.3d 636, 637 (Tex. 1999). Pelzel argues that Travis County waived its immunity from suit by accepting the benefits of full performance, and alternatively, that section 89.004 of the Texas Local Government Code authorizes suit when a claim is presented to and rejected by the commissioners court. See Tex. Loc.

Page 665

Gov't Code Ann. § 89.004. The trial court did not specify on which ground it found jurisdiction; therefore, we may affirm the order if either ground is legally proper. See Tenneco Inc. v. Enterprise Prods. Co., 925 S.W.2d 640, 642-43 (Tex. 1996).

Because the determination of subject matter jurisdiction is a question of law, we review the trial court's decision under a de novo standard of review. See Rylander v. Caldwell, 23 S.W.3d 132, 135 (Tex. App.--Austin 2000, no pet.). We do not look at the merits of the case to determine the district court's jurisdiction. See id. Rather, we accept as true the factual allegations made by the plaintiff, unless the defendant pleads and proves that the allegations were fraudulently made to confer jurisdiction. See id. Travis County does not assert that any of Pelzel's claims are fraudulent.

A plea to the jurisdiction contests the district court's authority to determine the subject matter of the cause of action. Amador v. San Antonio State Hosp., 993 S.W.2d 253, 254 (Tex. App.--San Antonio 1999, pet. denied). The plaintiff bears the burden of alleging facts affirmatively showing that the district court has subject matter jurisdiction. Texas Ass'n of Bus. v. Texas Air Control Bd., 852 S.W.2d 440, 446 (Tex. 1993). Unless the face of the petition affirmatively demonstrates a lack of jurisdiction, the district court must liberally construe the allegations in favor of jurisdiction. Peek v. Equipment Serv. Co., 779 S.W.2d 802, 804 (Tex. 1989).

I. Waiver by Conduct

To determine whether Travis County waived immunity by its conduct, we first address the effect of Federal Sign on immunity from suit when a state entity contracts with a...