Opinion

Opinion to: SJR TGT SN TJ EVK ERA GCH LCH JB

Opinion

issued December 21, 2006

In The

Court of Appeals

For The

First District of Texas

NO. 01-05-00993-CV

LUPE VILLARREAL, Appellant

V.

HARRIS COUNTY, TEXAS; PAUL BETTENCOURT, TAX-ASSESSOR

COLLECTOR FOR HARRIS COUNTY, TEXAS; HOUSTON INDEPENDENT SCHOOL DISTRICT; CITY

OF HOUSTON; AND LINEBARGER, GOGGAN, BLAIR & SAMPSON, L.L.P., Appellees

On Appeal from the 281st District Court

Harris County, Texas

Trial Court Cause No. 2004-27229

O P I N I O N

Lupe

Villarreal appeals a trial court order granting Harris County’s, Paul

Bettencourt’s (collectively, “Harris County”), the City of Houston’s, Houston

Independent School District’s, and Linebarger, Goggan, Blair & Sampson,

L.L.P.’s (collectively, the “City of Houston”) pleas to the jurisdiction. Villarreal contends the trial court erred: (1)

in granting the jurisdictional pleas because Villarreal’s article I, section 17

“takings” claim is not an inverse condemnation claim involving the government’s

use of eminent domain power, (2) in granting the pleas because the Harris

County Civil Courts at Law do not have exclusive jurisdiction over all alleged

violations of article I, section 17, (3) in granting Harris County’s plea

because Villarreal’s home was taken for a public use without just compensation

in violation of article I, section 17 of the Texas Constitution, and (4) in

granting Harris County’s plea because, although the Texas Tort Claims Act does

not apply in this case to waive the governmental immunity of Harris County,

Villarreal has pleaded other grounds for waiver. See

Tex. Const . art. I, § 17. We conclude that Villarreal’s

pleadings state a cause of action for inverse condemnation and the trial court properly

granted the jurisdictional pleas because the Harris County Civil Courts at Law

have exclusive jurisdiction over Villarreal’s article I, section 17 claim pursuant

to Texas Government Code section 25.1032(c) . Id. ;

Tex. Gov’t Code Ann. § 25.1032(c)

(Vernon 2004). We therefore affirm.

Background

In

October 2001, Linebarger, Goggan, Blair & Sampson, L.L.P. filed a tax suit

against Villarreal on behalf of Harris County, Houston Independent School

District, the City of Houston, the Harris County Education Department, the Port

of Houston, the Harris County Flood Control District, and Houston Community

College (collectively, the “taxing jurisdictions”) to collect delinquent taxes

on Villarreal’s home. The court awarded

the taxing jurisdictions a judgment against Villarreal for the delinquent taxes

and ordered the sale of Villarreal’s home to satisfy the judgment. Villarreal then obtained a tax loan from CGI

Financial, Inc. (“CGI”). CGI paid the

amount due under the judgment to the taxing jurisdictions before the scheduled

date of the tax sale, thereby extinguishing the debt. The taxing jurisdictions nevertheless

proceeded with the tax sale eight days later and sold Villarreal’s home to a

private entity, which subsequently evicted Villarreal. The taxing jurisdictions applied $15,158.15 of

the sale proceeds to satisfy the judgment, and deposited the remainder of

$25,941.85 into the registry of the court.

The taxing jurisdictions later returned the money they had received from

CGI.

Villarreal

then brought this action against Harris County and the City of Houston in the

281st District Court of Harris County, alleging that (1) the tax sale violated

article I, section 17 of the Texas Constitution because Harris County and the

City of Houston took Villarreal’s property for a public use without providing

just compensation, (2) the tax sale violated the Fifth and Fourteenth

Amendments to the United States Constitution because Harris County and the City

of Houston took Villarreal’s property for a public use without providing just

compensation, and without providing due process of law, and (3) the tax sale

violated Villarreal’s civil rights under 42 U.S.C. § 1983 . U.S. Const . amends. V, XIV; Tex. Const . art. I, § 17; 42 U.S.C. §

1983 (2000). Harris County filed a plea

to the jurisdiction contending that (1) the Harris County District Court lacks

jurisdiction over the article I, section 17 claim because the Harris County

Civil Courts at Law have exclusive jurisdiction over eminent domain

proceedings, including inverse condemnation claims, regardless of the amount in

controversy, (2) Villarreal’s article I, section 17 claim is barred by the

doctrine of governmental immunity because Villarreal’s property was not taken

for public use, but was sold to a private entity for private use, and (3)

Villarreal’s article I, section 17 claim is barred by the doctrine of

governmental immunity because the Texas Tort Claims Act does not provide a

waiver of governmental immunity for a claim arising in connection with the

assessment or collection of taxes by a governmental unit. The City of Houston also filed a plea to the jurisdiction,

contending that the Harris County District Court lacks jurisdiction over the

article I, section 17 claim because the Harris County Civil Courts at Law have

exclusive jurisdiction over eminent domain proceedings, including inverse

condemnation claims, regardless of the amount in controversy.

The trial court granted Harris County’s

and the City of Houston’s

pleas to the jurisdiction. Villarreal

brings this interlocutory appeal of the trial court’s order pursuant to Texas

Civil Practice and Remedies Code section 51.014(a)(8). Tex.

Civ. Prac. & Rem. Code Ann . § 51.014(a)(8) (Vernon Supp. 2006).

Plea to the Jurisdiction

A plea to the jurisdiction is a

dilatory plea that seeks dismissal of a case for lack of subject matter

jurisdiction. Harris County

v. Sykes , 136 S.W.3d 635, 638 (Tex.

2004). We review a trial court’s ruling

on a plea to the jurisdiction de novo because the question of whether a court

has subject matter jurisdiction is a matter of law. Hoff v.

Nueces County ,

153 S.W.3d 45, 48 (Tex. 2004); Tex. Dep’t of Parks & Wildlife v. Miranda ,

133 S.W.3d 217, 226 (Tex.

2004). Governmental immunity from suit

defeats a trial court’s subject matter jurisdiction and thus is properly

asserted in a plea to the jurisdiction. [1]

Miranda , 133 S.W.3d at 225–26.

When a plea to the jurisdiction challenges the pleadings, we determine

if the pleader has alleged facts that affirmatively demonstrate the court’s

jurisdiction to hear the cause. Id. We construe the pleadings liberally in favor

of the plaintiff and look to the pleader’s intent. Id. If the pleadings do not contain sufficient

facts to demonstrate affirmatively the trial court’s jurisdiction, but do not

affirmatively demonstrate incurable defects in jurisdiction, the issue is one

of pleading sufficiency, and the trial court should afford the plaintiff an

opportunity to amend. Id.

at 226–27. If the pleadings

affirmatively negate the existence of jurisdiction, then the trial court may

grant a plea to the jurisdiction without allowing the plaintiff an opportunity

to amend. Id.

at 227 .

In this case, the trial court did not

state the grounds upon which it granted Harris

County’s and the City of Houston’s pleas to the

jurisdiction. As required, Villarreal

has attacked all independent grounds that fully support the adverse

ruling. See Britton v. Tex. Dep’t of Criminal Justice , 95 S.W.3d 676, 681 (Tex. App.—Houston

[1st Dist.] 2002, no pet.). We will

sustain the trial court’s order granting the pleas to the jurisdiction if any

ground alleged by Harris County and the City of Houston is meritorious.

Inverse Condemnation

Villarreal first contends that the

trial court erred in granting Harris County’s and the City of Houston’s pleas

to the jurisdiction because Villarreal’s article I, section 17 takings claim is

not an inverse condemnation claim, and therefore not subject to Texas

Government Code section 25.1032(c). See Tex.

Gov’t Code Ann . § 25.1032(c).

Texas Government Code section 25.1032(c) provides: “ A county

civil court at law has exclusive jurisdiction in Harris County

of eminent domain proceedings, both statutory and inverse, regardless of the

amount in controversy.” Id. Harris

County and the City of Houston respond that Villarreal’s

article I, section 17 claim is an inverse condemnation claim as a matter of law.

A municipality exercises its power of eminent

domain through the process referred to as condemnation. City of Houston v. Boyle , 148 S.W.3d 171, 178 (Tex.

App.—Houston

[1st Dist.] 2004, no pet.) . Condemnation is the procedure by which the

sovereign exercises its right to take property of a private owner for public

use, without consent, upon the payment of just compensation. Id. ; A.C. Aukerman Co. v. State , 902 S.W.2d 576,

577 (Tex. App.—Houston [1st Dist.] 1995, writ denied). “Inverse condemnation occurs when (1) a

property owner seeks (2) compensation for (3) property taken for public use (4)

without process or a proper condemnation proceeding.” Boyle , 148 S.W.3d at 178 ; A.C.

Aukerman Co. , 902

S.W.2d at 577 .

A landowner whose property has been taken,

damaged, destroyed for, or applied to public use without adequate compensation

may bring an inverse condemnation claim pursuant to article I, section 17 of

the Texas Constitution. Boyle , 148 S.W.3d at 177 . The

constitution provides in part, “No person’s property shall be taken, damaged or

destroyed for or applied to public use without adequate compensation being

made, unless by the consent of such person . . . .” Tex. Const .

art. I, § 17; Boyle , 148

S.W.3d at 177 ; Tex.

Parks & Wildlife Dep’t v. Callaway , 971 S.W.2d 145, 148

(Tex. App.—Austin 1998, no pet.) (“An ‘inverse condemnation’ proceeding is the

avenue of relief available when property has been taken or damaged for public

use without compensation or a proper condemnation proceeding, and the property

owner wishes to recover compensation for his loss.”). The Texas Constitution therefore waives

governmental immunity from suit and liability “for the taking, damaging or

destruction of property for public use.”

Steele v. City of Houston , 603 S.W.2d 786, 791 (Tex. 1980); Boyle , 148 S.W.3d at 177 . “To demonstrate that a constitutional inverse

condemnation has occurred, the landowner must show that (1) the State intentionally

performed certain acts in the exercise of its lawful authority (2) that

resulted in a ‘taking’ of property (3) for public use.” [2] Boyle , 148 S.W.3d at 177 ; see

also Steele , 603 S.W.2d at 791–92; City of Houston v. Northwood Mun. Util. Dist.

No. 1 , 73 S.W.3d 304, 308

(Tex. App.—Houston

[1st Dist.] 2001, pet. denied) .

Villarreal notes that courts

have allowed article I, section 17 takings claims when the government entity apparently

used its taxing power to complete the taking.

See Tex. Workforce Comm’n v.

Midfirst Bank , 40 S.W.3d 690, 697 (Tex. App.—Austin 2001, pet. denied)

(holding that state agency’s withholding of funds pursuant to its taxing power

that were subject to private party’s perfected security interest constituted taking

under article I, section 17); County of

Burleson v. Gen. Elec. Capital Corp. , 831 S.W.2d 54, 60 (Tex. App.—Houston

[14th Dist.] 1992, writ denied) ( allowing article I, section 17 takings claim

when taxing authority illegally sold mobile home in which plaintiff had security

interest).

In Midfirst Bank , the Texas Workforce Commission (“TWC”) obtained a

judgment against Reliance for unpaid unemployment taxes. 40 S.W.3d at 693 . TWC used this judgment to levy receivables owned

by Reliance. Id. Midfirst Bank, however, had a perfected

security interest in the receivables. Id.

at 692 . TWC destroyed Midfirst’s

security interest when it wrongfully levied the receivables without discovering

the security interest. Id.

at 694 . Midfirst brought a takings claim

against TWC under article I, section 17.

Id.

The trial court found that a taking had occurred and awarded

damages. Id. The appellate court agreed and affirmed,

holding that Midfirst could bring an article I, section 17 claim even though it

appeared as though TWC used its taxing power to accomplish the taking instead

of its eminent domain power. Id.

at 694–98.

In General Electric , Burleson

County, pursuant to its

power of taxation, seized and sold a mobile home under a tax warrant because

the owners had failed to pay taxes assessed on the home. 831 S.W.2d at 57–58. The County, however, did not adhere to the

statutory requirements for conducting a summary sale. Id. at

59. The plaintiff, General Electric

Capital Corporation, had a lien on the mobile home, which the improper sale

extinguished. Id. General Electric sued the County alleging

that the improper sale of the mobile home pursuant to the County’s taxing

authority constituted a taking under article I, section 17. Id. at

59–60. The appellate court agreed and

affirmed the judgment of the trial court awarding General Electric damages

under article I, section 17. [3] Id. at 61.

Villarreal contends that Midfirst Bank and General Electric

demonstrate that a plaintiff can maintain a cause of action under article I,

section 17 if the government uses its taxing power to complete a taking, and

this differs from its eminent domain power.

Villarreal therefore asserts that not all claims brought under article

I, section 17 are “inverse condemnation” claims involving the government’s

exercise of eminent domain power, and thus, Texas Government Code section 25.1032(c)

does not mandate a plaintiff to bring a takings claim involving the improper

use of taxing power in a Harris County Civil Court at Law because such a claim

does not involve eminent domain power. See Tex. Gov’t Code Ann . § 25.1032(c).

Analysis

Article I, section 17 does

not grant any powers to the government, but instead limits the inherent

sovereign power of eminent domain by imposing the requirements that the government

take property only for “public use” and pay “adequate compensation” when doing

so. See Tex. Const . art. I, § 17; Whittington v. City of Austin , 174

S.W.3d 889, 896 (Tex. App.—Austin 2005, pet. denied); McInnis v. Brown County Water Improvement Dist. No. 1 , 41 S.W.2d

741, 744 (Tex. Civ. App.—Austin 1931, writ ref’d). “‘Eminent domain’ refers to ‘[t]he power to

take private property for public use by the state, municipalities, and private

persons or corporations authorized to exercise functions of state power.’” Taub v. Aquila Sw. Pipeline Corp. , 93 S.W.3d 451, 456 (Tex. App.—Houston

[14th Dist.] 2002, no pet.) (alteration in original) (quoting Black’s Law Dictionary 523 (6th ed.

1990)). If Villarreal is to recover for

the alleged taking in this case, however, the only provision of the constitution

that provides a remedy is article I, section 17. See

Tex.

Const .

art. I, § 17; Whittington , 174 S.W.3d

at 896 ; McInnis , 41 S.W.2d at 744 . If the government properly uses its taxing

power to take private property, the owner of the property has no remedy and

article I, section 17 does not apply. See Rylander v. Palais Royal, Inc. , 81

S.W.3d 909, 915 (Tex. App.—Austin 2002, pet. denied) (“The State has the

authority to levy and collect taxes in a rational and legitimate manner. The exercise of that authority here does not

amount to a taking.”). In contrast, if

the government improperly uses its taxing power to take private property for

public use, then an article I, section 17 taking has occurred and the owner may

recover in a takings action. See Midfirst Bank , 40 S.W.3d at 697 ; Gen. Elec. ,

831 S.W.2d at 60 . An improper use of

taxing power is therefore not a use of taxing power at all, but instead a

condemnation and a use of eminent domain power. We hold that the improper use of taxing power to

accomplish a taking of real property is a use of eminent domain power, and

thus, jurisdiction over any claim that alleges such rests exclusively in the

Harris County Civil Courts at Law. [4] See Tex. Gov’t

Code Ann . § 25.1032(c).

Villarreal’s pleadings

allege that Harris County and the City of Houston improperly used their taxing power to

take her property for public use. Villarreal’s

pleadings therefore state a cause of action for inverse condemnation and the

trial court did not err in granting Harris County’s and the City of Houston’s

pleas to the jurisdiction. The district

court does not have jurisdiction over Villarreal’s article I, section 17 claim pursuant

to Texas Government Code section 25.1032(c).

Id. Because the trial

court had a meritorious ground upon which to grant Harris

County’s and the City of Houston’s pleas to the

jurisdiction, we need not address Villarreal’s remaining issues.

Conclusion

We hold that Villarreal’s

pleadings state a cause of action for inverse condemnation. Harris County Civil Courts at Law have exclusive

jurisdiction over all article I, section 17 claims pursuant to section

25.1032(c) of the Texas Government Code . See id. ;

Kerr v. Harris

County , 177 S.W.3d 290, 294 (Tex. App.—Houston

[1st Dist.] 2005, no pet.); Boyle ,

148 S.W.3d at 178–79. The

trial court properly granted Harris County’s and the City of Houston’s jurisdictional pleas, and we therefore

affirm the order of the trial court.

Jane

Bland

Justice

Panel consists of Chief Justice

Radack and Justices Alcala and Bland.

[1] As the Texas Supreme Court

has observed, (1) sovereign immunity refers to the State’s immunity from suit

and liability and protects the State and its divisions, and (2) governmental

immunity protects political subdivisions of the State, including counties,

cities, and school districts. Wichita

Falls State Hosp. v. Taylor ,

106 S.W.3d 692 , 694 n.3 (Tex.

2003).

[2] This is the standard for all takings claims under

article I, section 17. See State v. Hale , 136 Tex.

29 , 35–36, 146 S.W.2d 731, 736 (1941) ; Kerr v. Tex. Dep’t of Transp. , 45

S.W.3d 248 , 250–51 (Tex. App.—Houston [1st Dist.] 2001,

no pet.).

[3] Villarreal also contends that Steele v. City of Houston supports her argument in this case. 603 S.W.2d 786, 789 (Tex. 1980).

Steele involved police officers who intentionally set fire to

Steele’s house to flush out escaped prisoners. Id. At one point in the

opinion, the court discussed the fact that “[t]he taking, the damaging, or the

destruction of property are often treated, more or less, as synonyms, but the

terms are different and have different historical origins.” Id. The court also recognized that article I,

section 17 encompasses the taking, damaging, and destruction of property. Id. at 791.

The court then expressly stated, “ Neither

the parties nor the courts below have regarded this case as one of eminent

domain or inverse condemnation. Neither

have we.” Id. at 789. The court ultimately held

that the government’s duty to pay for taking property rights is not excused by

labeling the taking as an exercise of police powers. Id. at 793. The court never explained

why the case was not regarded as one of eminent domain or inverse condemnation,

and did not discuss eminent domain or inverse condemnation any further. Steele

is therefore not controlling in this case.

After the Steele decision, the Texas Supreme Court recognized that

a plaintiff can bring an inverse condemnation claim when the government has

taken, damaged, or destroyed her property in violation of article I, section

17. See

Tarrant Reg’l Water Dist. v. Gragg , 151

S.W.3d 546, 554 (Tex.

2004) (“ A physical

taking may occur when the government physically appropriates or invades private

property, or unreasonably interferes with the landowner’s right to use and

enjoy it. When the government takes

private property without first paying for it, the owner may recover damages for

inverse condemnation.” (citation

omitted)); City of Dallas

v. Jennings , 142 S.W.3d 310 , 313 n.2 (Tex. 2004) (noting that “taking,”

“damaging,” and “destruction” of one’s property are three distinct claims

arising under article I, section 17, but term “taking” has become used as

shorthand to refer to all three types of claims).

[4] We

further note that this court has applied Government Code section 25.1032(c) to

alleged non-negligent nuisance claims that, like the alleged improper use of

taxing power here, resulted in a taking as well. See

Kerr v. Harris County ,

177 S.W.3d 290, 294 (Tex. App.—Houston [1st Dist.] 2005, no pet.); City of Houston v. Boyle , 148

S.W.3d 171 , 177–79 (Tex. App.—Houston [1st Dist.] 2004,

no pet.) .