“We need not decide whether these statements could constitute a waiver, judicial admission, or the basis for judicial estoppel, because even if they could, such doctrines cannot create subject-matter jurisdiction where it does not otherwise exist.”
How later courts described this case
- “We need not decide whether these statements could constitute a waiver, judicial admission, or the basis for judicial estoppel, because even if they could, such doctrines cannot create subject-matter jurisdiction where it does not otherwise exist.”
- “When [the Texas Workforce Commission’s] decision became final, Igal was bound by that decision.”
- “We can see no reason why the jurisdiction of the Trial Court should not attach as soon as the ruling of the Commission became final.”
- recognizing that ARBs perform quasi-judicial functions
Written by the judges who cited it.
The opinion
Supreme Court of Texas
══════════
No. 23-0138
══════════
Oncor Electric Delivery Company NTU, LLC,
Petitioner,
v.
Wilbarger County Appraisal District and Wilbarger County
Appraisal Review Board,
Respondents
═══════════════════════════════════════
On Petition for Review from the
Court of Appeals for the Seventh District of Texas
═══════════════════════════════════════
~ consolidated for oral argument with ~
══════════
No. 23-0145
══════════
Mills Central Appraisal District and Mills County Appraisal
Review Board,
Petitioners,
v.
Oncor Electric Delivery Company NTU LLC,
Respondent
═══════════════════════════════════════
On Petition for Review from the
Court of Appeals for the Third District of Texas
═══════════════════════════════════════
Argued March 21, 2024
JUSTICE BUSBY delivered the opinion of the Court.
In these two property tax disputes, Oncor seeks a multimillion-
dollar reduction in the total values of certain electric transmission lines
in the 2019 certified appraisal rolls for the Wilbarger County Appraisal
District (Wilbarger CAD) and Mills Central Appraisal District (Mills
CAD). Oncor’s predecessor agreed to the lines’ value in each county to
settle its protests of the Districts’ initial appraised values, but Oncor
now contends that these agreements are void due to mutual mistake.
Oncor filed unsuccessful motions for correction of the appraisal
rolls with each County Appraisal Review Board (ARB) and then sued in
district court in Wilbarger and Mills Counties, asserting that it was
entitled to judicial review under Section 42.01 of the Tax Code as well
as declaratory relief under the Uniform Declaratory Judgments Act
(UDJA). These suits raise several questions regarding a taxpayer’s
ability to correct errors in a district’s appraisal rolls once certified, as
well as the finality of a “statutory agreement” between the taxpayer and
a district under Section 1.111(e) of the Tax Code.
The parties’ disputes come to us on appeal from rulings on the
taxing authorities’ pleas to the jurisdiction. Thus, we must consider first
whether questions regarding the effect of a Section 1.111(e)
agreement—such as its validity and scope—are relevant to a trial court’s
2
subject-matter jurisdiction over a suit for judicial review under
Section 42.01 of the Tax Code. The trial and appellate courts below
provided conflicting answers. Like the Austin Court of Appeals, we hold
that the resolution of such questions does not implicate jurisdiction and
remand the cases to the trial courts for further proceedings.
Because proof that a statutory agreement is valid and applicable
would not deprive a trial court of subject-matter jurisdiction, we do not
reach the merits of the parties’ disputes about whether Oncor has
identified errors eligible for correction under Sections 25.25(c) or (d) of
the Tax Code, whether any such errors fall within the scope of the
parties’ Section 1.111(e) settlement agreements, and whether the
doctrine of mutual mistake is an available defense to such agreements,
applies here, and affords the remedy Oncor seeks. We likewise do not
reach the parties’ arguments about the UDJA or whether the ARBs are
proper parties to Oncor’s suit and the subsequent appeals.
STATUTORY BACKGROUND
Determining the nature of the issues in dispute and which of
them (if any) are properly before us at this procedural stage requires an
understanding of the various phases of the Tax Code’s administrative
process. We therefore begin with an overview of that process and the
remedies available to taxpayers.
“The Tax Code establishes a detailed set of procedures that
property owners must abide by to contest the imposition of property
taxes.” Morris v. Houston Indep. Sch. Dist., 388 S.W.3d 310, 313 (Tex.
2012). Under Section 42.09 of the Code, those “administrative
procedures are ‘exclusive’ and most defenses are barred if not raised
3
therein.” Cameron Appraisal Dist. v. Rourk, 194 S.W.3d 501, 502 (Tex.
2006). As a result, a taxpayer’s failure to exhaust the Tax Code’s
exclusive administrative remedies “deprives the courts of jurisdiction to
decide most matters relating to ad valorem taxes.” Id.
In general, the chief appraiser of each county appraisal district is
responsible for preparing appraisal records listing all property that is
taxable in the district and stating the appraised value of each. TEX. TAX
CODE § 25.01.1 Under certain conditions, the chief appraiser “may
contract with a private appraisal firm to perform appraisal services for
the district, subject to his approval.” Id. § 25.01(b). The chief appraiser
“submit[s] the completed appraisal records to the appraisal review board
for review and determination of protests,” id. § 25.22(a), which are
addressed in Chapters 41 and 42 of the Code.
Taxpayers may protest the appraised value of their properties
and certain other matters under Chapter 41, Subchapter C. ARBs are
charged with holding a hearing on each protest at which the taxpayer is
entitled to appear and offer evidence. Id. § 41.45. The taxpayer—and,
under certain circumstances, the chief appraiser—can seek judicial
review of the ARB’s determination of the protest under Chapter 42.
Alternatively, as occurred here, the taxpayer can settle either before or
after filing a protest by agreeing to a value with the chief appraiser
1 When, as here, “real property is located partially inside the boundaries
of more than one appraisal district, the chief appraisers who are responsible
for appraising the property shall to the greatest extent practicable coordinate
their appraisals of each portion of the property to ensure to the greatest extent
possible that the property as a whole is appraised at its market value.” TEX.
TAX CODE § 25.17(b).
4
under Section 1.111(e). This section provides that such an agreement
“is final” if it relates to certain matters, id. § 1.111(e), in which case the
ARB “may not review or reject” the agreement. Id. § 41.01(b).
Although Chapter 41 protests “are broad in scope and weigh[ted]
in favor of the property owner,” they are also “subject to strict time
limitations.” Willacy County Appraisal Dist. v. Sebastian Cotton &
Grain, Ltd., 555 S.W.3d 29, 40 (Tex. 2018). In contrast, Section 25.25
“allows corrections after the time to protest has expired and appraisal
rolls have been approved,” but “[s]uch corrections can be made only
under limited circumstances.” Id. For example, subsection (d)
authorizes motions “to change the appraisal roll to correct an error that
resulted in an incorrect appraised value for the owner’s property” under
certain conditions, which can be brought before the taxes become
delinquent. TEX. TAX CODE § 25.25(d).2 And subsection (c) authorizes
motions to “change[] . . . the appraisal roll for any of the five preceding
years to correct” certain categories of errors, including clerical errors3
2 Subsection (d) is the only provision that subjects the property owner
to a late-correction penalty and has been described as the only subsection that,
among other things, “allows for the substantive reevaluation of a property’s
market value.” Willacy County, 555 S.W.3d at 41. But “the roll may not be
changed” under subsection (d) if “the property was the subject of a protest
brought by the property owner under Chapter 41, a hearing on the protest was
conducted in which the property owner offered evidence or argument, and the
appraisal review board made a determination of the protest on the merits,” or
if “the appraised value of the property was established as a result of a written
agreement between the property owner or the owner’s agent and the appraisal
district.” TEX. TAX CODE § 25.25(d-1)(1)-(2).
3 The Tax Code defines clerical error to mean an error “that is or results
from a mistake or failure in writing, copying, transcribing, entering or
retrieving computer data, computing, or calculating” or “that prevents an
5
that affect a property owner’s liability for a tax imposed in that tax year.
Id. § 25.25(c)(1). As with Chapter 41 protests, the ARB’s determination
of a motion to correct the appraisal roll under Section 25.25 is subject to
judicial review under Chapter 42.
Chapter 42 provides for review of ARB decisions by trial de novo
in district court. Id. § 42.23(a). Subject to limited exceptions, a petition
for review “must be brought against the appraisal district” and “may not
be brought against the appraisal review board.” Id. § 42.21(b).4
Section 42.01(a)(1) lists six types of ARB orders that the property owner
is “entitled to appeal,” including “a protest by the property owner as
provided by Subchapter C of Chapter 41” and “a motion filed under
Section 25.25.” Id. § 42.01(a)(1)(A)-(B). Section 42.01(a)(1) separately
authorizes the property owner to appeal an order of the ARB
determining, among other things, “that the appraisal review board lacks
jurisdiction to finally determine a protest by the property owner under
Subchapter C, Chapter 41, or a motion filed by the property owner under
Section 25.25 because the property owner failed to comply with a
requirement of [those statutes].” Id. § 42.01(a)(1)(E).
appraisal roll or a tax roll from accurately reflecting a finding or determination
made by the chief appraiser, the appraisal review board, or the assessor,” but
“does not include an error that is or results from a mistake in judgment or
reasoning in the making of the finding or determination.” TEX. TAX CODE
§ 1.04(18).
4 “An appraisal district may hire an attorney that represents the district
to represent the appraisal review board established for the district to file an
answer and obtain a dismissal of a suit filed against the appraisal review
board . . . .” TEX. TAX CODE § 42.21(b).
6
FACTUAL AND PROCEDURAL BACKGROUND
A. Oncor’s predecessor files and settles protests in
several counties
Sharyland Distribution & Transmission Services, L.L.C., owned
a system of four different voltages of transmission lines—345 kV,
230 kV, 138 kV, and 69 kV—that crossed several Texas counties.
Sharyland timely filed Chapter 41 protests of the 2019 appraised values
of its lines in Wilbarger CAD and Mills CAD, as well as eleven other
county appraisal districts. As grounds for its protests, Sharyland
asserted that the appraised value was incorrect as well as unequal
compared with other properties. Those thirteen appraisal districts hired
an appraisal firm, Pritchard & Abbott (P&A), to help them evaluate the
appraised values of Sharyland’s property in each county for 2019.
Sharyland hired Duff & Phelps to act as its agent.5
Rather than appraising the property in each county according to
its characteristics there, P&A employed the “unit valuation” method of
appraisal. Working with Duff & Phelps, P&A began by determining the
taxable value of Sharyland’s property statewide, then allocated that
value among different categories of property to come up with a statewide
value for each category, including separate categories for transmission
lines of different voltages. The next step in the process involved dividing
the allocated value for each voltage category by the total number of miles
of transmission lines of that voltage that Sharyland owned across the
5 See TEX. TAX CODE § 1.111(a) (“A property owner may designate a
lessee or other person to act as the agent of the owner for any purpose under
this title in connection with the property or the property owner.”).
7
thirteen appraisal districts, resulting in a “value per mile” for that type
of transmission line. The final appraised value in each appraisal district
would then be calculated by multiplying the mileage in each county by
the “value per mile” for each type of transmission line. In other words,
the 51.95 miles of 345 kV transmission line in Wilbarger County and the
74.34 miles of 345 kV transmission line in Mills County would be
multiplied by the “value per mile,” resulting in a final appraised value
for each CAD.
To calculate the “value per mile” for each type of transmission
line, P&A asked Sharyland’s agent Duff & Phelps to provide the total
mileages for Sharyland’s 138 kV and 345 kV transmission lines. In
responding, Duff & Phelps inadvertently transposed the two mileages.
P&A divided the total statewide value of each type of transmission line
by the mileages Sharyland’s agent provided, resulting in a “value per
mile” for the 345 kV transmission lines of $1,060,021. This “value per
mile” was listed in P&A’s final unit appraisal report, which was provided
to Sharyland and each county appraisal district.
Sharyland then executed separate agreements with each
appraisal district in late June 2019 settling Sharyland’s protest in those
districts. Sharyland’s agreements with Wilbarger CAD and Mills CAD
are both entitled “Settlement and Waiver of Protest,” and each states a
total value for Sharyland’s 345 kV transmission lines within the
county—$55,068,090 for Wilbarger County and $78,801,960 for Mills
County. The agreements also include the following statement: “I
acknowledge that the subject matter of the protest filed on the above
date concerning the property described above has been settled. I hereby
8
withdraw my protest and waive my right to any further proceeding in
this matter.”
B. Oncor files motions to correct under Section 25.25
Sharyland later sold some of its transmission lines to Oncor,
including its 345 kV transmission lines. In December 2019, Oncor
discovered that Sharyland’s agent had misreported to P&A the total
statewide mileage of Sharyland’s 138 kV and 345 kV transmission lines,
which had resulted in a higher “value per mile” of $1,060,0216 for the
345 kV transmission lines. Using preprinted forms provided by the
ARBs for each appraisal district, Oncor then filed two Section 25.25
motions to correct the appraisal roll with the Wilbarger County ARB
and two with Mills County ARB in January 2020. Oncor’s selections on
the forms indicated that its motions to correct concerned a “clerical error
that affects Movant’s liability,” as well as the “[i]nclusion of property
that does not exist in the form or at the location described in the
appraisal roll” for the 2019 tax year. In describing the specific error for
correction, Oncor wrote:
Please correct the value per 345 kV to $378,882 per mile
and the value per 138 kV to $37,145 per mile. The value
per mile on the appraisal is incorrect as the mileages were
switched between the two different types of lines which
results in an incorrect valuation of these accounts. Please
see the attachments.
Using a preprinted form, the Mills ARB issued an “Order
Determining Motion to Correct Appraisal Roll,” selecting the box
6 If the mileages had been correctly reported, the calculation would have
resulted in a “value per mile” of $378,882 for the 345 kV transmission lines.
9
indicating that “[t]he ARB lacks jurisdiction to determine the motion
and hereby dismisses the motion.” Following a hearing, the Wilbarger
ARB issued an “Order Determining Motion to Correct Appraisal Roll,”
selecting the box indicating that “[t]he property owner’s motion
concerning matters permitted by Tax Code Section 25.25 is denied and
the appraisal records should not be changed.”
C. Oncor seeks judicial review
Oncor then filed parallel suits in district court seeking judicial
review.
1. Oncor’s suit against Mills County taxing
authorities
Oncor sued the Mills CAD and Mills ARB in district court in Mills
County under Sections 42.01(a)(1)(B) and 42.21 of the Tax Code,
asserting that the Mills ARB incorrectly concluded it lacked jurisdiction
to determine the motions. Oncor also asserted that Section 25.25(g)
authorizes a property owner’s suit to compel the ARB to order a change
in the appraisal roll. Oncor alleged that correction was authorized
under subsections (c)(1) and (c)(3) of Section 25.25. It sought a judgment
ordering the Mills County taxing authorities to correct the Mills CAD’s
2019 appraisal roll to reflect that the 2019 taxable value of Oncor’s 74.34
miles of 345 kV transmission line in Mills County is $28,166,078.
Specifically, Oncor alleged that the Mills CAD’s 2019 appraisal
roll contained a clerical error under various theories, including: (1) that
the clerical error is the $78,801,960 value set for Oncor’s 74.3 miles of
345 kV transmission line in the county; (2) that this value includes a
clerical error because it is based on a determination that each mile of
10
Oncor’s 345 kV transmission line had a taxable value of $1,060,021; and
(3) that this per-mile value is based on an error in writing down the
correct number of miles of Oncor’s 345 kV transmission line in Texas. It
alleged that the 2019 taxable value of Oncor’s 74.34 miles of 345 kV
transmission line in Mills County absent the clerical error is
$28,166,078. Alternatively, Oncor complained that $50,635,882 of the
$78,801,960 of taxable value attributed to Oncor’s 74.34 miles of 345 kV
transmission line in Mills County was attributable to miles of
transmission line that did not exist in Mills County.
Mills ARB filed an answer, generally denying Oncor’s allegations
and asserting a plea to the jurisdiction. Mills ARB contended it was
immune from suit, noting that Chapter 42 contains no waiver of
immunity and provides instead that “[a] petition for review may not be
brought against the appraisal review board.” TEX. TAX CODE § 42.21(b).
In the alternative, Mills ARB challenged jurisdiction due to Oncor’s
failure to exhaust its administrative remedies. Mills ARB claimed that
it did not determine Oncor’s 25.25(c) motions, but instead dismissed
them for lack of jurisdiction based on the settlement agreement between
Sharyland and the chief appraiser for Mills CAD. Because such
agreements are final and binding under Section 1.111(e) of the Tax Code
and an ARB is prohibited from reviewing or rejecting the agreement
under Section 41.01(b), Mills ARB argued that the Code required Oncor
to file a suit to compel the ARB to conduct a hearing under
Section 41.45(f).
Mills CAD also filed an answer generally denying Oncor’s claims
and a plea to the jurisdiction based on the settlement agreement. Mills
11
CAD argued that under Section 1.111(e), the agreement is final and not
subject to judicial review in a property owner’s suit under Chapter 42.
Mills CAD further argued that because there was no order from Mills
ARB determining either motion, Section 25.25(g) is inapplicable and
does not authorize appeal to the district court.
In response, Oncor not only disputed whether Section 1.111(e)
agreements operate as a bar to challenges under Section 25.25, it also
amended its petition to allege that the Section 1.111(e) agreement “is
voidable because it was based on a mistake of fact held mutually by the
parties that materially affected the agreed-on appraised value in the
Settlement and Waiver of Protest.” Oncor asserted that the court had
jurisdiction to determine its claim of mutual mistake under the UDJA.
The trial court signed an order granting Mills CAD’s plea to the
jurisdiction and dismissing “this case” with prejudice, but it did not
expressly address Mills ARB’s plea. Oncor appealed, and the Austin
Court of Appeals reversed in part and remanded for further proceedings.
The court first held that the trial court’s order was not a final judgment,
and therefore Mills ARB was not a proper party to the interlocutory
appeal because Oncor’s claim against it remained pending in the trial
court. 660 S.W.3d 288, 293 (Tex. App.—Austin 2022).
Turning to Oncor’s claim against Mills CAD, the court concluded
that the ARB’s dismissal is subject to judicial review. It observed that
Sections 42.01(a)(1)(B) and 25.25(g) require a “determination” by an
ARB as a statutory prerequisite to suit, which includes any “final
decision by a court or administrative agency.” 660 S.W.3d at 294. Then,
relying on this Court’s opinion in Willacy County, the court of appeals
12
held that district courts “have jurisdiction to review the validity of [a
Section 1.111(e) agreement] and, with appropriate evidence, to render a
judgment finding the agreement invalid.” 660 S.W.3d at 298. The court
did not decide whether mutual mistake provides a defense to such an
agreement. See id. at 299 n.3. Rather, it reversed the trial court’s order
dismissing Oncor’s claims against Mills CAD and remanded for further
proceedings. See id. at 300. The Mills County taxing authorities then
filed petitions for review in this Court, which we granted.
2. Oncor’s suit against the Wilbarger County
taxing authorities
Meanwhile, Oncor sued the Wilbarger CAD and Wilbarger ARB
in district court in Wilbarger County, asserting the same claims as in
Mills County and seeking substantially identical relief. Oncor sought a
judgment that the 2019 taxable value of its 51.95 miles of 345 kV
transmission line in Wilbarger County is $19,682,919. It also amended
its petition to assert a claim under the UDJA for mutual mistake and to
determine the meaning of relevant Tax Code provisions.
Wilbarger CAD and Wilbarger ARB jointly filed a plea to the
jurisdiction based on the Section 1.111(e) agreement. Acknowledging
that Wilbarger ARB had denied Oncor’s motion to correct on the merits,
the Wilbarger County taxing authorities nonetheless argued that
Section 25.25(g) does not compel a remedy where none otherwise exists
under Section 25.25. Thus, an agreement under Section 1.111(e) is final
and does not come within the statutory waiver of immunity allowing
judicial review.
13
Responding to the plea to the jurisdiction, Oncor argued that a
court may not entertain a suit to consider the propriety of a
Section 1.111(e) agreement, but it has jurisdiction to determine the
scope of the agreement. In Oncor’s view, so long as an agreement does
not memorialize an understanding that the appraisal roll does not
contain a clerical error, later motions to correct such an error are outside
the agreement’s scope. Alternatively, Oncor argued the agreement was
voidable under the doctrine of mutual mistake.
The Wilbarger County taxing authorities also filed a motion for
partial summary judgment, arguing that (1) Oncor cannot sue under the
UDJA because the Tax Code gives ARBs exclusive jurisdiction over
property tax disputes; (2) Oncor’s UDJA claims are barred by
governmental immunity; and (3) Oncor’s claim of mutual mistake is a
common-law contract theory not applicable to a statutory agreement
under Section 1.111(e). In response, Oncor argued that it was invoking
the UDJA only to the extent the court concluded it lacked jurisdiction
under the Tax Code, so its UDJA claims do not violate the redundant
remedies doctrine.
The trial court denied both the plea to the jurisdiction and the
motion for partial summary judgment, and the Wilbarger County taxing
authorities filed an interlocutory appeal of the denial of their plea. The
Amarillo Court of Appeals reversed the trial court’s order and rendered
judgment granting the Wilbarger County taxing authorities’ plea. 660
S.W.3d 760, 762 (Tex. App.—Amarillo 2022).
The court acknowledged that unlike motions under
Section 25.25(d), the statute does not contain “an express articulation
14
that an agreement precludes a challenge” under Section 25.25(c). Id. at
765. But the court relied on the plain language of Section 1.111(e) to
hold that such agreements are final as to “any matter which may be
corrected under section 25.25,” id., and that such finality “prohibits
Oncor from pursuing judicial review of the valuation of its transmission
lines in Wilbarger County.” Id. at 763. The court of appeals also rejected
Oncor’s argument that the agreement was voidable based on mutual
mistake, noting that this Court has thus far recognized only fraud as a
permissible ground for setting aside a statutory agreement on valuation.
Id. at 766. Oncor filed a petition for review, which we granted.
ANALYSIS
The parties’ initial disputes, which are presented through pleas
to the jurisdiction followed by interlocutory appeals, can be grouped into
two categories: the scope of the Section 1.111(e) agreements and
application of the mutual mistake doctrine. The question before us,
which divided the courts of appeals, is whether these disputes are
relevant to the trial courts’ subject-matter jurisdiction over Oncor’s
appeals challenging the disposition of its Section 25.25 motions to
correct the appraisal rolls.
First, Oncor asserts that its requested corrections fall outside the
scope of the Section 1.111(e) agreements. According to Oncor, the
agreements resolved only its predecessor’s protests related to the fair
market value and unequal appraisal of the transmission lines. Because
Section 25.25(d) is the only provision that allows for a reevaluation of
market value, Oncor argues that only subsection (d) motions to correct
would be precluded because such errors in judgment or reasoning are
15
not “clerical errors” under the Tax Code. In Oncor’s view, the 2019
agreements did not memorialize an understanding that the appraisal
rolls do not contain clerical errors, so they do not bar later motions to
correct such errors under Section 25.25(c).
Conversely, the taxing authorities contend that the asserted
mistake falls under subsection (d), which applies to any “error that
resulted in an incorrect appraised value,” and that in any event there is
no “clerical error” under subsection (c) because the chief appraiser in
each county never agreed to the value Oncor now seeks to impose. In
addition, they argue that the Section 1.111(e) agreements settled
protests disputing the correct value-per-mile of the transmission lines
in each county—the very same value Oncor now contends was erroneous
and should be corrected. Thus, Oncor’s challenge falls within the scope
of its predecessor’s agreements with each county’s chief appraiser fixing
the final value of the lines in that county. Additionally, Mills CAD
argues that each agreement did not just settle Oncor’s protests but also
expressly waived any further action on the subject matter of the
protests.
Second, Oncor asserts that mutual mistake, like fraud, can render
a Section 1.111(e) agreement voidable. According to Oncor, at the time
of the 2019 settlements, both Sharyland’s agent and the firm hired by
the CADs “were operating under the mutual, mistaken, belief that
Sharyland owned a total of 343 miles of 345kV transmission line.” The
mistake therefore prevented a “meeting of the minds”7 between
7 Cf. Haws & Garrett Gen. Contractors, Inc. v. Gorbett Bros. Welding
Co., 480 S.W.2d 607, 609 (Tex. 1972) (noting that both express contracts and
16
Sharyland and the chief appraisers for each CAD because Sharyland
would not have agreed to the valuations listed in its settlement
agreements had it known those amounts were based upon incorrect
calculations of the “value per mile” for its transmission lines. Because
the mutual mistake doctrine permits reformation or recission of
ordinary contracts under certain circumstances, Oncor contends it is one
of the “basic contract principles” applicable to Section 1.111(e)
agreements under Willacy County.
In response, the taxing authorities argue that the policy
considerations in favor of fraud voiding a Section 1.111(e) agreement do
not apply to mutual mistake. In their view, the Legislature’s choice to
make Section 1.111(e) agreements final and unreviewable reflects its
intent to prohibit reforming or rescinding such an agreement for any
reason other than failure to comply with the statute itself. Pointing out
that the remedies and procedures provided in the Tax Code are exclusive
and do not include a mutual mistake defense, the taxing authorities
contend that declaring a Section 1.111(e) agreement voidable due to
mutual mistake would be contrary to the Code’s comprehensive scheme.
The taxing authorities also dispute whether the asserted mistake was
mutual when the chief appraisers simply took Oncor’s predecessor
those implied in fact require “a meeting of the minds of the parties as implied
from and evidenced by their conduct and course of dealing . . . the essence of
which is consent to be bound”).
17
Sharyland at its word, listing the property according to Sharyland’s
agreement and the representations of its agent.8
For the reasons explained below, we conclude that the judicial-
review jurisdiction of district courts under Chapter 42 does not depend
on the resolution of such questions regarding the preclusive effect of the
Section 1.111(e) agreements. In particular, the following disputes
among the parties are not jurisdictional: (1) whether Oncor’s motions to
correct assert a “clerical error” that may be corrected under
Section 25.25(c), an error resulting in an incorrect value under
Section 25.25(d), or both; (2) whether the scope of the Section 1.111(e)
agreements includes any such errors; and (3) whether the mutual
mistake doctrine is an available defense to such agreements, whether
mutual mistakes were made by the parties to the agreements here, and
what remedies are available for such mistakes. Accordingly, we do not
reach the merits of those disputes.
I. Standard of review
We construe the Tax Code and address questions regarding the
scope of a trial court’s subject-matter jurisdiction and the exclusivity of
8 Texas law recognizes at least three types of contractual mistakes, but
the parties have not yet addressed in detail which category would apply here.
See, e.g., Davis v. Grammar, 750 S.W.2d 766, 768 (Tex. 1988); James T. Taylor
& Son, Inc. v. Arlington Indep. Sch. Dist., 335 S.W.2d 371, 373-76 (Tex. 1960);
Guggenheim Corp. Funding, LLC v. Valerus Compression Servs., L.P., 465
S.W.3d 673, 685-86 & n.8 (Tex. App.—Houston [14th Dist.] 2015, pet. denied);
N.Y. Party Shuttle, LLC v. Biello, 414 S.W.3d 206, 212 (Tex. App.—Houston
[1st Dist.] 2013, pet. denied). The parties also have not thoroughly briefed, and
the lower courts had no opportunity to address, whether any remedy available
for mistake (if proven) would support the judgment Oncor seeks. We therefore
express no view on these questions.
18
an agency’s jurisdiction de novo. See Subaru of Am., Inc. v. David
McDavid Nissan, Inc., 84 S.W.3d 212, 222 (Tex. 2002). This Court has
recognized that the “modern direction of policy” is “to reduce the
vulnerability of final judgments to attack on the ground that the
tribunal lacked subject matter jurisdiction.” Dubai Petroleum Co. v.
Kazi, 12 S.W.3d 71, 76 (Tex. 2000). Our “approach to jurisdictional
questions [is] designed to strengthen finality and reduce the possibility
of delayed attacks on judgments, regardless of whether the claim [is]
anchored in common law or [is] a specially-created statutory action.”
City of DeSoto v. White, 288 S.W.3d 389, 394 (Tex. 2009).
Thus, even in the context of judicial review of administrative
action, “our focus is to avoid a result that leaves the decisions and
judgments of the [administrative agency] in limbo and subject to future
attack, unless that was the Legislature’s clear intent.” Id. “[W]e have
been reluctant to conclude that a provision is jurisdictional, absent clear
legislative intent to that effect.” In re United Servs. Auto Ass’n, 307
S.W.3d 299, 306 (Tex. 2020) (internal quotation marks omitted). In
general, questions regarding whether a plaintiff has established its
right to go forward with its suit, satisfied the requirements of a
particular statute, or proven that it can prevail on the merits pertain to
the plaintiff’s right to relief rather than the subject-matter jurisdiction
of the court to afford it. Pike v. Tex. EMC Mgmt., LLC, 610 S.W.3d 763,
774 (Tex. 2020).
19
II. The finality of Section 1.111(e) agreements does not make
questions about their validity or scope jurisdictional.
“In Texas, a deal is, of course, a deal.” Chalker Energy Partners
III, LLC v. Le Norman Operating LLC, 595 S.W.3d 668, 669 (Tex. 2020).
Although a Section 1.111(e) agreement is “properly characterized as a
statutory agreement” rather than a contract, we held in Willacy County
that “some basic contract principles apply.” 555 S.W.3d at 52 (internal
quotation marks omitted). After noting the principles that a “contract
is subject to avoidance on the ground of fraudulent inducement” and that
a “contract that is the product of fraudulent misrepresentations is
merely voidable, not void from its inception,” we concluded that “the
validity of [a Section 1.111(e)] agreement may be subject to attack on
the basis of fraud, even if the agreement is [by statute] not otherwise
subject to review or rejection.” Id.
Here, all parties agree that the relevant settlement agreements
are valid agreements under Section 1.111(e), but they dispute the extent
to which our decision in Willacy County determined the applicability and
jurisdictional import of the doctrine of mutual mistake with respect to
such agreements. Oncor notes that Willacy County cited a mutual
mistake case, Williams v. Glash, 789 S.W.2d 261 (Tex. 1990). For their
part, the taxing authorities argue that fraud is fundamentally different
and sui generis as a basis for avoiding such agreements.
In evaluating these arguments, we are mindful that Willacy
County came to this Court in a very different procedural posture. There,
the taxpayer challenged an ARB’s Section 25.25 correction order on
various grounds, including that it was inconsistent with a
Section 1.111(e) agreement; the trial court held a bench trial de novo
20
and found, among other things, that the agreement was void due to the
taxpayer’s fraud; and the court then signed a final judgment affirming
the correction order on the merits. See Willacy County, 555 S.W.3d at
36-37.
In these cases, however, there are no final judgments, and the
only rulings over which we have appellate jurisdiction concern the
taxing authorities’ pleas to the jurisdiction. Thus, the central and
antecedent question before us today is whether any of the parties’ initial
disputes outlined above implicate the trial courts’ subject-matter
jurisdiction. See, e.g., City of Conroe v. San Jacinto River Auth., 602
S.W.3d 444, 456 n.19 (Tex. 2020) (“The scope of this interlocutory appeal
is limited to the denial of the Cities’ pleas to the jurisdiction . . . , and [a
merits issue regarding the contract’s] incontestability does not inform
that analysis.”). To answer this question, we must determine whether
the Legislature’s use of the word “final” in Section 1.111(e) to describe
settlement agreements “means final and appealable or final and not
appealable.” Sultan v. Matthew, 178 S.W.3d 747, 748 (Tex. 2005).
Although a prior version of Section 1.111(e) provided that such
agreements were “not final unless approved by the appraisal review
board,”9 the current version provides as follows:
An agreement between an owner or the owner’s agent and
the chief appraiser is final if the agreement relates to a
matter: (1) which may be protested to the appraisal review
board or on which a protest has been filed but not
determined by the board; or (2) which may be corrected
under Section 25.25 or on which a motion for correction
9 Act of June 15, 1989, 71st Leg., R.S., ch. 796, § 2, 1989 Tex. Gen. Laws
3591 (amended 1993) (current version at TEX. TAX CODE § 1.111(e)).
21
under that section has been filed but not determined by the
board.
TEX. TAX CODE § 1.111(e). Thus, “Section 1.111(e) agreements become
final without approval or adoption by the ARB,” and the Tax Code
separately “precludes an ARB from even reviewing such agreements,”
much less rejecting them. Willacy County, 555 S.W.3d at 46-47; see TEX.
TAX CODE § 41.01(b) (“The board may not review or reject an agreement
between a property owner . . . and the chief appraiser under
Section 1.111(e).”).
As an initial matter, we have recognized in other contexts that
the Legislature’s use of the term “final” does not inherently express an
intent to prevent judicial review. See, e.g., Mobil Oil Corp. v. Matagorda
County Drainage Dist. No. 3, 597 S.W.2d 910, 911 (Tex. 1980).10 And
this Court has described an administrative decision as “final” as a means
of demarcating the point at which “a party has exhausted administrative
remedies.” Subaru of Am., 84 S.W.3d at 224.11
10 See also Mosley v. Tex. Health & Hum. Servs. Comm’n, 593 S.W.3d
250, 262 (Tex. 2019) (rejecting argument that administrative order “was final
for purposes of appeal”); Lindsay v. Sterling, 690 S.W.2d 560, 563 (Tex. 1985)
(holding the Administrative Procedure and Texas Register Act “indicates that
a decision is not final and appealable until the motion for rehearing is
overruled either expressly or by operation of law,” and “[t]herefore, the thirty-
day period for appealing to the district court does not begin to run until after
the motion for rehearing has been overruled”); accord Tex. Emp. Comm’n v.
Stewart Oil Co., 267 S.W.2d 137, 138 (Tex. 1954) (“We can see no reason why
the jurisdiction of the Trial Court should not attach as soon as the ruling of the
Commission became final.”).
11 See also Tex. Educ. Agency v. Houston Indep. Sch. Dist., 660 S.W.3d
108, 119 (Tex. 2023) (“Because the investigation . . . became final before the
effective date, the District is limited to the remedies that existed before the law
22
Furthermore, although an ARB “has no authority to change a
settlement reached by a taxpayer and the chief appraiser, it certainly
has the authority to take note of what property was included.”
Matagorda County Appraisal Dist. v. Coastal Liquids Partners, L.P., 165
S.W.3d 329, 331 (Tex. 2005) (footnote omitted). Similarly, we have held
that “before a court finds that a section 1.111(e) agreement is ‘final’ and
therefore cannot be reviewed, it must confirm whether (1) the agreement
actually constitutes a section 1.111(e) agreement, and (2) what the
terms of the agreement actually cover.” Willacy County, 555 S.W.3d at
47. Thus, the jurisdiction of ARBs and district courts must extend at
least that far.
Nonetheless, “[c]ourts have held that the finality of
section 1.111(e) agreements precludes judicial review of those
agreements.” Id. at 46. Courts that have characterized these questions
regarding a Section 1.111(e) agreement as falling outside their
jurisdiction have given one of two reasons for doing so.
First, several courts have based their jurisdictional holding on the
absence of jurisdiction at the ARB.12 Because the ARB may not review
changed.”); Igal v. Brightstar Info. Tech. Grp., 250 S.W.3d 78, 92 (Tex. 2008)
(“When [the Texas Workforce Commission’s] decision became final, Igal was
bound by that decision.”); accord TEX. TAX CODE § 41A.11 (“An arbitration
award or settlement reached between the parties to an arbitration under this
chapter is considered to be a final determination of an appeal for purposes of
Subchapter C, Chapter 42.” (emphasis added)); TEX. GOV’T CODE § 2001.171
(“A person who has exhausted all administrative remedies available within a
state agency and who is aggrieved by a final decision in a contested case is
entitled to judicial review under this chapter.”).
12 See, e.g., Advanced Powder Sols., Inc. v. Harris County Appraisal
Dist., 528 S.W.3d 779, 788 (Tex. App.—Houston [14th Dist.] 2017, pet. granted,
23
or reject Section 1.111(e) agreements,13 these courts reason that there
can be no “order of the appraisal review board” to appeal to district court
under Section 42.01. Under this view, a court must determine as a
jurisdictional matter whether the relief sought would require it to
review or reject an applicable Section 1.111(e) agreement. The rationale
for this approach emphasizes that an ARB is “a quasi-judicial body” and
therefore “must act within the strictures set by the legislature and . . .
may not stray outside its specifically granted authority.” Town of
Bartonville Plan. & Zoning Bd. of Adjustments v. Bartonville Water
Supply Corp., 410 S.W.3d 23, 30 (Tex. App.—San Antonio 2013, pet.
denied) (citation omitted); see also Harris County Appraisal Dist. v. Tex.
Workforce Comm’n, 519 S.W.3d 113, 130 (Tex. 2017) (recognizing that
ARBs perform quasi-judicial functions).
This theory ignores that the claim before each ARB for decision
and each district court for review is a motion to correct the appraisal roll
under Section 25.25, and both indisputably have jurisdiction over that
claim. TEX. TAX CODE §§ 25.25, 42.01(a)(1)(B), (E). Each county’s taxing
authorities have raised the Section 1.111(e) agreement as a defense to
that claim, and Oncor has raised mutual mistake in an effort to avoid
the defense. We see nothing in the Tax Code to indicate that the result
judgm’t vacated, remanded by agr.); Bullseye PS III LP v. Harris County
Appraisal Dist., 365 S.W.3d 427, 435 (Tex. App.—Houston [1st Dist.] 2011, pet.
denied); Sondock v. Harris County Appraisal Dist., 231 S.W.3d 65, 69 (Tex.
App.—Houston [14th Dist.] 2007, no pet.); MHCB (USA) Leasing & Fin. Corp.
v. Galveston Cent. Appraisal Dist. Rev. Bd., 249 S.W.3d 68, 83 (Tex. App.—
Houston [1st Dist.] 2007, pet. denied).
13 See TEX. TAX CODE § 41.01(b).
24
of success on this defense should be dismissing the motion for lack of
jurisdiction rather than denying it on the merits due to the preclusive
effect of the agreement. See Pike, 610 S.W.3d at 774. As noted above,
“final” does not necessarily carry that implication. And the prohibition
on reviewing or rejecting the agreement is not absolute as we recognized
in Willacy County.
In addition, we disagree that the scope of an ARB’s authority
necessarily dictates the scope of the district court’s jurisdiction. For
example, even where an administrative agency “has no authority to
determine . . . or to provide a remedy” for certain aspects of a litigant’s
claim, we have nonetheless required an aggrieved party to “pursu[e]
damages or other relief in the trial court after the agency has exercised
its exclusive jurisdiction over the relevant issues.” CPS Energy v. Elec.
Reliability Council of Tex., 671 S.W.3d 605, 619 (Tex. 2023). Similarly,
an ARB’s inability to “take subsequent action that is contrary to that
agreement,” Bastrop Cent. Appraisal Dist. v. Acme Brick Co., 428 S.W.3d
911, 918 (Tex. App.—Austin 2014, no pet.), does not deprive the ARB of
the “sole authority to initially decide” any issues governed by the Tax
Code, nor does it divest the ARB or the court of jurisdiction when a claim
is “predicated on issues or claims” governed by the Code, Subaru of Am.,
84 S.W.3d at 226, 228.14
14 Accord Clint Indep. Sch. Dist. v. Marquez, 487 S.W.3d 538, 549 (Tex.
2016) (requiring exhaustion of appeal to Commissioner of Education where
litigants “do not allege that any of these laws violate the Texas Constitution;
they allege that the district violates the Constitution by failing to comply with
the laws” and “[t]hose same laws grant the Commissioner both the authority
and the obligation to remedy the situation”).
25
Second, some courts have held that an agreement under
Section 1.111(e) “does not come within the statutory waiver of immunity
allowing judicial review.” Harris County Appraisal Dist. v. McDonald,
No. 01-19-00990-CV, 2021 WL 3556215, at *3 (Tex. App.—Houston [1st
Dist.] Aug. 12, 2021, no pet.). Although Section 42.01(a)(1)(B) “provides
a limited statutory waiver of immunity that allows property owners to
seek judicial review of an appraisal board’s determination of a motion to
correct filed under Texas Tax Code section 25.25,” the “waiver does not
extend to judicial review of” a Section 1.111(e) agreement. Id. Thus,
establishing a Section 1.111(e) agreement “satisfie[s] [the CAD’s] initial
burden” to show the trial court lacks subject-matter jurisdiction because
the parties entered into an agreement that makes a correction motion
based on the “manner of calculating the property’s . . . value
unreviewable.” Id. at 4.
In other words, this approach would have courts treat the
existence of a Section 1.111(e) agreement as a “jurisdictional fact”
implicating the merits of the claim, requiring that they “move beyond
the pleadings and consider evidence when necessary to resolve the
jurisdictional issues.” Alamo Heights Indep. Sch. Dist. v. Clark, 544
S.W.3d 755, 770-71 (Tex. 2018). And many jurisdictional issues are
likely to arise under this approach. For example, if Section 25.25(d)
governs Oncor’s claims, either instead of or in addition to subsection (c),
then its express carveouts—the existence of the written agreement, a
prior determination by the ARB on the merits, or the ratio of the correct
to incorrect appraised value, TEX. TAX CODE § 25.25(d), (d-1)—would
likewise be jurisdictional facts rather than reasons for denying the
26
claims on the merits. Indeed, even the exclusion of “the substantive
reevaluation of a property’s market value” from “[t]he limited
corrections available” under subsection (c), Willacy County, 555 S.W.3d
at 41, would carry jurisdictional import. For example, where “the error
alleged by the property owner is not a clerical one,” these courts have
“conclude[d] that the property owner failed to affirmatively show that
the Board’s denial of its correction motion was reviewable by the . . .
court as a decision under” Section 25.25(c)(1). McDonald, 2021 WL
3556215, at *5.15
We likewise disagree with this approach. “Sovereign immunity
implicates a court’s subject-matter jurisdiction, but their contours are
not coextensive.” Engelman Irrigation Dist. v. Shields Bros., Inc., 514
S.W.3d 746, 755 (Tex. 2017). Some statutes “waive[] a governmental
unit’s immunity from suit ‘to the extent of liability’ created by the Act.”
Gulf Coast Ctr. v. Curry, 658 S.W.3d 281, 286 (Tex. 2022) (quoting TEX.
CIV. PRAC. & REM. CODE § 101.025(a)).16 In contrast, any waiver of
sovereign immunity here is predicated not on the viability of the
litigant’s claim on the merits, but on the existence of “an order of the
appraisal review board determining . . . the motion filed under
Section 25.25.” TEX. TAX CODE § 42.01(a)(1)(B). And Chapter 42
provides for the filing of a petition for review with the district court,
15 Accord Acme Brick, 428 S.W.3d at 917; Houston Cement Co. v. Harris
County Appraisal Dist., No. 14-12-00491-CV, 2013 WL 3243281, at *3 (Tex.
App.—Houston [14th Dist.] June 25, 2013, no pet.).
16 See also, e.g., TEX. CIV. PRAC. & REM. CODE § 110.008(a) (“Subject to
Section 110.006, sovereign immunity to suit and from liability is waived and
abolished to the extent of liability created by Section 110.005 . . . .”).
27
id. § 42.21(a), without reference to whether the property owner is also
“entitled to a final determination by the court.” Id. § 42.01(c).
In addition, although our decision in Willacy County did not need
to address the separate question whether an attack on the validity of a
Section 1.111(e) agreement establishes a defect in subject-matter
jurisdiction or simply a defense on the merits, aspects of our opinion
support viewing the inquiry as non-jurisdictional. For example, we
discussed the possibility that “estoppel or quasi-estoppel may preclude
[a taxpayer] from entering into an agreement under section 1.111(e),” as
well as whether the CAD’s failure to raise its fraud allegation before the
ARB waived the issue. 555 S.W.3d at 48. Of course, subject-matter
jurisdiction cannot be conferred by waiver or estoppel.17
Willacy County also held that a Section 1.111(e) agreement
procured by fraudulent misrepresentations “is merely voidable, not void
from its inception.” Id. at 52. But contracts that are voidable due to
fraud “remain[] enforceable” and are “voided only if the defrauded party
proves a right to avoid the contract and chooses to do so.” Forman v.
Classic Century Homes, Ltd., No. 02-12-00362-CV, 2014 WL 6840173, at
17 See In re Crawford & Co., 458 S.W.3d 920, 928 n.7 (Tex. 2015) (“We
need not decide whether these statements could constitute a waiver, judicial
admission, or the basis for judicial estoppel, because even if they could, such
doctrines cannot create subject-matter jurisdiction where it does not otherwise
exist.”); see also Tex. Disposal Sys. Landfill, Inc. v. Travis County Cent.
Appraisal Dist., __ S.W.3d __, slip op. at 12 & n.40 (Tex. June 21, 2024) (No. 22-
0620) (noting that parties’ ability to waive exhaustion of administrative
remedies under Section 42.231 of the Tax Code undermines the ordinary
inference that exhaustion implicates jurisdiction, which “cannot be
manufactured by consent or waiver”).
28
*7 (Tex. App.—Fort Worth Dec. 4, 2014, no pet.) (emphasis added).18
Conversely, a party who is fraudulently induced to enter into a voidable
agreement may “engage[] in conduct that . . . ratifies the agreement and
waives any right to assert the fraud as basis to avoid the agreement.”
Id. This voidable nature of a fraudulently induced Section 1.111(e)
agreement is likewise inconsistent with treating the inducement
defense as jurisdictional, as sovereign immunity must be waived by the
Legislature rather than by a party’s conduct.
After we decided Willacy County, the Legislature amended
Section 42.01 in 2019, adopting additional provisions that confirm our
indication that disputes as to the validity or scope of a Section 1.111(e)
agreement do not affect the district court’s subject-matter jurisdiction.
For example, Section 42.01(a)(1)(e) now permits judicial review of an
ARB order determining that the ARB lacks jurisdiction of a motion to
correct, which is separate from subsection (a)(1)(b)’s provision for
judicial review of ARB orders determining a motion to correct. The
Legislature also adopted subsection 42.01(c), which recognizes the
appealing property owner’s “entitle[ment] to a final determination by
the court” of its Section 25.25 motion—the same language used to
describe a property owner who establishes its compliance with
applicable prepayment requirements in an appeal under
Section 42.01(a)(1)(c). See TEX. TAX CODE § 42.01(a)(1)(C), (b), (c).
18 See also Harris v. Archer, 134 S.W.3d 411, 427 (Tex. App.—Amarillo
2004, pet. denied) (“A contract which is voidable because it was the product of
fraud is voided only if the defrauded party proves a right to avoid the contract
and chooses to do so.”).
29
This structural reading is also consistent with Section 42.21(h),
which provides for the district court’s “jurisdiction over an appeal under
this chapter brought on behalf of a property owner . . . so long as the
property was the subject of an appraisal review board order, the petition
was filed within the period required by [Section 42.21(a)], and the
petition provides sufficient information to identify the property that is
the subject of the petition.” In contrast, the Legislature’s inclusion of
more direct limitations on the availability of judicial review in other
provisions of the Tax Code confirms our reluctance to treat an ARB’s
inability to review or reject a Section 1.111(e) agreement as
jurisdictional.19
Finally, although we agree that the Legislature’s amendments to
Section 1.111(e) were intended to “make it easier for parties to reach
agreements,” Sondock v. Harris County Appraisal Dist., 231 S.W.3d 65,
69 (Tex. App.—Houston [14th Dist.] 2007, no pet.), we see no indication
that the Legislature did so in furtherance of the broader object of the
administrative review process, which “is to resolve the majority of tax
19 See, e.g., TEX. TAX CODE § 42.21(a) (stating that “[f]ailure to timely
file a petition bars any appeal under this chapter”); id. § 42.21(b) (“An
appraisal district may . . . file an answer and obtain a dismissal of a suit filed
against the appraisal review board in violation of this subsection.” (emphasis
added)); id. § 41A.015(j)(4) (“An award under this section . . . is final and may
not be appealed.” (emphasis added)); id. § 41A.09(b)(4) (“An award under this
section . . . is final and may not be appealed except as permitted under
Section 171.088, Civil Practice and Remedies Code, for an award subject to
that section.”); id. § 41A.03(b) (providing that the existence of a Chapter 42
appeal of a property’s market value “waives the owner’s right to request
binding arbitration under this chapter regarding the value of that property,”
in which case the “arbitrator shall dismiss any pending arbitration
proceeding”); id. § 21.10(a) (requiring the chief appraiser to “accept” as well as
“approve or deny” an application for an allocation).
30
protests at [the administrative] level, thereby relieving the burden on
the court system.” Webb County Appraisal Dist. v. New Laredo Hotel,
Inc., 792 S.W.2d 952, 954 (Tex. 1990). We have previously noted that
“[t]he policies behind res judicata” embody similar concerns,
“‘reflect[ing] the need to bring litigation to an end, prevent vexatious
litigation, maintain stability of court decisions, promote judicial
economy, and prevent double recovery.’” Engelman Irrigation Dist., 514
S.W.3d at 750 (quoting Barr v. Resol. Tr. Corp., 837 S.W.2d 627, 629
(Tex. 1992)). Res judicata likewise “bars litigation of all issues
connected with a cause of action or defense which, with the use of
diligence, might have been tried in a former action as well as those
which were actually tried.” Abbot Labs. v. Gravis, 470 S.W.2d 639, 642
(Tex. 1971).
Unlike issues of subject-matter jurisdiction, however, res judicata
is an affirmative defense on the merits that is waived if not properly
pleaded. TEX. R. CIV. P. 94; see also Travelers Ins. Co. v. Joachim, 315
S.W.3d 860, 862 (Tex. 2010); DeBord v. Muller, 446 S.W.2d 299, 301
(Tex. 1969). Treating a Section 1.111(e) agreement as jurisdictional
would therefore confer greater finality on the parties’ settlement than
on a court’s judgment resolving the merits of the parties’ dispute. We
do not think the Legislature’s mere use of the word “final” can be
stretched so far.
We therefore hold that although the assertion of a preclusion
defense based on a Section 1.111(e) agreement may narrow the trial
court’s scope of review, this limitation is not jurisdictional. Rather,
much as the scope of the taxpayer’s Chapter 41 protest limits the
31
grounds a CAD may assert on appeal, the limitation is procedural. See
Tex. Disposal Sys. Landfill, Inc. v. Travis County Cent. Appraisal Dist.,
__ S.W.3d __, slip op. at 14-15 (Tex. June 21, 2024) (No. 22-0620).
Similarly, the appealing taxpayer (or appraisal district) may only
prevail on its motion to correct in district court based on matters that
are either consistent with the terms of or outside the scope of a valid
Section 1.111(e) agreement.
In sum, although limitations on an ARB’s authority to review or
reject a Section 1.111(e) agreement may restrict the scope of a court’s
review, they do not defeat its jurisdiction. Accordingly, the trial court in
the Mills County case and the court of appeals in the Wilbarger County
case erred to the extent they relied on Section 1.111(e) to hold that the
taxing authorities’ pleas to the jurisdiction should be granted.
III. We need not decide questions regarding the UDJA or
whether the ARBs are proper parties to Oncor’s suits.
We briefly address the parties’ remaining arguments regarding
jurisdiction. First, Oncor pleaded its UDJA claim in the alternative,
explaining that it would only be operative in the event the trial court
first determined it lacked jurisdiction under Section 25.25 and
Chapter 42. Because we have held that the trial courts do not lack
jurisdiction, we need not address the UDJA or resolve Oncor’s argument
regarding the scope of its immunity waiver.
Second, the Wilbarger ARB and Mills ARB contend that
regardless of whether the Section 1.111(e) inquiries are jurisdictional,
the ARBs are not proper parties to Oncor’s lawsuits. They rely on
Section 42.21(b), which provides that “[a] petition for review may not be
32
brought against the appraisal review board” and authorizes the
appraisal district to “obtain a dismissal of a suit filed” in violation of that
prohibition. TEX. TAX CODE § 42.21(b). They also note that Section 42.24
authorizes the court to grant relief by adjusting the appraised value
even though the ARB is not a party. On the other hand, Section 42.21(d)
authorizes service on the ARB chairman.
In response, Oncor argues in part that Section 25.25(g) authorizes
“suit to compel the [ARB] to order a change in the appraisal roll”
independent of the procedures in Chapter 42. But we agree with the
taxing authorities that the Legislature has incorporated the cause of
action authorized by subsection (g) into Chapter 42, amending the
statute to treat judicial review of a Section 25.25 motion as an “appeal”
under that chapter. See id. § 42.01(a)(1)(B); G.E. Am. Commc’n v.
Galveston Cent. Appraisal Dist., 979 S.W.2d 761, 766 (Tex. App.—
Houston [14th Dist.] 1998, no pet.).
Wilbarger ARB has not argued in any court that the question
whether it is a proper party under Chapter 42 implicates either
immunity or jurisdiction. In the trial court, Mills ARB argued in its plea
to the jurisdiction that the Tax Code “contains no waiver of the ARB’s
immunity” from suit and liability.
We agree with the Austin Court of Appeals, however, that this
issue “is not a question of subject-matter jurisdiction but whether the
trial court’s order ruled on the [Mills ARB’s] jurisdictional challenge at
all, i.e., whether the order was a final judgment.” 660 S.W.3d at 291.
We also agree with that court’s conclusion that the trial court’s “order,
construed as a whole, did not actually dispose of Oncor’s cause of action
33
against the [ARB] and therefore did not actually dispose of every
pending claim and party; certainly it did not do so clearly and
unequivocally.” Id. at 293.20 The trial court’s order granting Mills
CAD’s plea to the jurisdiction was therefore “not a final judgment,
Oncor’s claim against the [Mills ARB] is still pending in the trial court,
and the [ARB] is not a proper party to this interlocutory appeal.” Id.
Because our record contains no ruling from the trial court on Mills
ARB’s plea to the jurisdiction or the extent to which the Tax Code waives
its governmental immunity, Section 51.014 of the Civil Practice and
Remedies Code does not authorize Mills ARB’s interlocutory appeal of
this issue. See TEX. CIV. PRAC. & REM. CODE § 51.014(a)(8) (“A person
may appeal from an interlocutory order of a district court . . . [that]
grants or denies a plea to the jurisdiction by a governmental unit.”);
Wheelabrator Air Pollution Control, Inc. v. City of San Antonio, 489
S.W.3d 448, 451 n.2 (Tex. 2016). We therefore do not reach the merits
of whether it was a proper party.
CONCLUSION
We conclude that a Section 1.111(e) agreement poses non-
jurisdictional limits on the scope of appellate review under Chapter 42
of the Tax Code. We therefore affirm the court of appeals’ judgment
reversing the trial court’s dismissal order in Oncor Electric Delivery Co.
20 See Sealy Emerg. Room, L.L.C. v. Free Standing Emerg. Room Mgrs.
of Am., L.L.C., 685 S.W.3d 816, 820 (Tex. 2024) (“There are two paths for an
order to become a final judgment without a trial: the order can (1) dispose of
all remaining parties and claims then before the court, regardless of its
language; or (2) include unequivocal finality language that expressly disposes
of all claims and parties.”).
34
NTU LLC v. Mills Cent. Appraisal District (No. 23-0145), reverse the
court of appeals’ judgment reversing the trial court’s denial of the pleas
to the jurisdiction in Wilbarger County Appraisal District v. Oncor
Electric Delivery Co. NTU, LLC (No. 23-0138), and remand both causes
to their respective trial courts for further proceedings.
J. Brett Busby
Justice
OPINION DELIVERED: June 21, 2024
35