Texas Windstorm Insurance Association v. Stephen Pruski

Supreme Court of Texas

══════════

No. 23-0447

══════════

Texas Windstorm Insurance Association,

Petitioner,

v.

Stephen Pruski,

Respondent

═══════════════════════════════════════

On Petition for Review from the

Court of Appeals for the Thirteenth District of Texas

═══════════════════════════════════════

Argued February 21, 2024

JUSTICE LEHRMANN delivered the opinion of the Court.

Texas Insurance Code Section 2210.575(e) provides that a suit

against the Texas Windstorm Insurance Association shall be presided

over by a district judge appointed by the Judicial Panel on Multidistrict

Litigation. The issue presented is whether this statute deprives a

district court of subject matter jurisdiction over such a suit when the

presiding judge is not appointed by the panel. The court of appeals held

that it does and vacated the district court’s judgment. We disagree and

hold that the panel-appointment requirement, while mandatory, is not

jurisdictional. Thus, although the presiding judge in this case was not

appointed by the MDL panel as the statute requires, the district court

nevertheless had subject matter jurisdiction over the suit. We reverse

the court of appeals’ judgment and remand to that court for further

proceedings.

I. Background

Texas Windstorm Insurance Association (TWIA) is a

quasi-governmental body that serves as an “insurer of last resort,”

offering windstorm and hail insurance to residential and commercial

property owners in the coastal region of Texas who cannot get this

coverage in the regular market due to the risk of catastrophic

hurricanes. 1 TWIA’s organization, operations, and all related matters

are governed by Chapter 2210 of the Texas Insurance Code.

In 2011, after TWIA received over 100,000 claims totaling more

than $2.9 billion following Hurricanes Ike and Dolly, the Legislature

significantly amended Chapter 2210 to, among other things, modify the

process by which suits could be brought against TWIA. Relevant here,

the Legislature added Section 2210.575, which provides in pertinent

part:

[T]he claimant may bring an action against [TWIA] in a

district court in the county in which the loss that is the

subject of the coverage denial occurred. An action brought

under this subsection shall be presided over by a judge

1 TWIA Overview, TEXAS WINDSTORM INSURANCE ASSOCIATION,

https://www.twia.org/about-us/overview/#:~:text=HISTORY%20AND%20PUR

POSE,insurance%20in%20the%20private%20market (last visited May 9,

2024).

2

appointed by the judicial panel on multidistrict litigation

designated under Section 74.161 (Judicial Panel on

Multidistrict Litigation), Government Code. A judge

appointed under this section must be an active

judge . . . who is a resident of the county in which the loss

that is the basis of the disputed denied coverage occurred

or of a first tier coastal county or a second tier coastal

county adjacent to the county in which that loss occurred.

TEX. INS. CODE § 2210.575(e) (emphasis added). 2

TWIA insured Stephen Pruski’s beachfront condominium in Port

Aransas against hail and windstorm damage. Pruski filed two claims

with TWIA after Hurricane Harvey and a subsequent storm, and TWIA

partially accepted and partially denied coverage for both claims. Pruski,

proceeding pro se, served TWIA with a notice of intent to sue, see id.

§ 2210.575(a), and subsequently filed suit in Nueces County District

Court, seeking damages for TWIA’s alleged improper denial of coverage.

The case was assigned to the Honorable Sandra Watts of the 117th

District Court of Nueces County without appointment by the Judicial

Panel on Multidistrict Litigation. Pruski learned of the statutory

provision requiring a panel appointment and emailed the court clerk to

inquire about it. The clerk responded that a judge would be

“electronically assigned,” and Pruski took no further action on the issue

at that time. Pruski then filed a motion for summary judgment that did

not mention the panel-appointment requirement. But at the hearing on

2 Chapter 2210 also limits the issues that may be brought in such a

proceeding to (1) whether TWIA’s denial of coverage was proper and (2) the

amount of damages to which the claimant is entitled. TEX. INS. CODE

§ 2210.576(a).

3

the motion, which was the first hearing in the case, Pruski referenced

that requirement. The trial court denied the motion.

Pruski subsequently moved to recuse Judge Watts under Texas

Rule of Civil Procedure 18b, 3 claiming she was biased and unqualified

because, among other reasons, she had not been appointed by the MDL

panel. Judge Watts declined to recuse and referred Pruski’s motion to

the regional administrative judge, who denied it. TWIA then filed a

motion for summary judgment, arguing that the damages for which

Pruski sought recovery were not covered by his policy as a matter of law.

The district court granted the motion and rendered a final, take-nothing

judgment for TWIA. Pruski appealed, arguing in part that Judge Watts

was not qualified to render judgment because she had not been

appointed by the MDL panel.

The court of appeals reversed, holding that a trial judge who is

not appointed by the MDL panel is “without authority to render

judgment” in a suit under Chapter 2210. 667 S.W.3d 460, 467 (Tex.

App.—Corpus Christi–Edinburg 2023). Accordingly, the court held that

the district court’s judgment was void and remanded with instructions

to vacate the judgment. Id.

We granted TWIA’s petition for review.

II. Discussion

Under Section 2210.575(e), an action brought against TWIA

concerning denied coverage “shall be presided over by a judge appointed

3 Rule 18b enumerates various grounds on which a judge must

disqualify or recuse. TEX. R. CIV. P. 18b.

4

by the [MDL] panel.” The issue is whether that requirement is

jurisdictional, such that a district court lacks the power to hear the case

if the judge was not so appointed, rendering any resulting judgment

void. See Engelman Irrigation Dist. v. Shields Bros., 514 S.W.3d 746,

750 (Tex. 2017) (“A judgment rendered without subject-matter

jurisdiction is void and subject to collateral attack.”).

A. Subject Matter Jurisdiction

A statute can be, and often is, mandatory without being

jurisdictional. See S.C. v. M.B., 650 S.W.3d 428, 443 (Tex. 2022) (citing

Albertson’s, Inc. v. Sinclair, 984 S.W.2d 958, 961 (Tex. 1999)). We

recently reiterated that classifying a statutory provision as

jurisdictional requires “clear legislative intent to that effect.” Id. at 436

(quoting Crosstex Energy Servs., L.P. v. Pro Plus, Inc., 430 S.W.3d 384,

391 (Tex. 2014)). In other words, “[a]bsent a compelling showing to the

contrary, we presume that remedies remain intact and that the

jurisdiction of a district court—our state’s sole court of general

jurisdiction—remains undisturbed.” Id. This precedent is consistent

with the modern jurisprudential trend of “reduc[ing] 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) (citation omitted). 4

4 Before Dubai Petroleum, our case law largely characterized the failure

to comply with statutory provisions governing statutory causes of action as

jurisdictional in nature, such that those provisions “must be complied with in

all respects or the action is not maintainable.” Mingus v. Wadley, 285 S.W.

1084, 1087 (Tex. 1926). In Dubai Petroleum, we overruled Mingus “to the

5

As we confirmed in Crosstex, we employ statutory-interpretation

principles in evaluating whether a statutory requirement is

jurisdictional, considering (1) most importantly, the statute’s plain

meaning; (2) the presence or absence of specific consequences for

noncompliance; (3) the purpose of the statute; and (4) the consequences

that result from each possible interpretation. 430 S.W.3d at 392. These

principles lead us to conclude that Section 2210.575(e)’s requirement

that the presiding judge be appointed by the MDL panel is not

jurisdictional.

The statute provides that “[a]n action brought under this

subsection shall be presided over by a judge appointed by the [MDL]

panel.” TEX. INS. CODE § 2210.575(e). The court of appeals emphasized

the statute’s use of “shall” and its corresponding imposition of a

mandatory duty. 667 S.W.3d at 464. However, as we explained in S.C.,

“the commonly used verb ‘shall’ does not clearly convey exclusive

jurisdiction.” 650 S.W.3d at 443. If it did, every venue statute would be

classified as jurisdictional. See, e.g., TEX. CIV. PRAC. & REM. CODE

§ 15.002 (“Except as otherwise provided . . . all lawsuits shall be brought

[in the proper county].” (emphasis added)). The Legislature often uses

unequivocal language to make certain statutory requirements

jurisdictional, but it chose not to do so here. See TEX. GOV’T CODE

§ 311.034 (providing direction on construing statutes with respect to

waiver of sovereign immunity and stating that “[s]tatutory prerequisites

extent that it characterized the plaintiff’s failure to establish a statutory

prerequisite as jurisdictional.” 12 S.W.3d at 75.

6

to a suit, including the provision of notice, are jurisdictional

requirements in all suits against a governmental entity”).

Relatedly, Section 2210.575 contains no consequences for failure

to obtain an MDL-appointed judge. “[W]hen a statute does not require

dismissal for failure to comply, this weighs in favor of a finding that it

is not jurisdictional.” Tex. Mut. Ins. Co. v. Chicas, 593 S.W.3d 284, 289

(Tex. 2019). Indeed, in Crosstex, we held that a statutory requirement

that a certificate of merit be filed with the plaintiff’s original petition in

certain suits is not jurisdictional despite the fact that the statute

mandates dismissal for failure to comply. 430 S.W.3d at 392. Here, not

only does Section 2210.575 say nothing about dismissal, but as the court

of appeals noted, it provides no guidance on the necessary procedure to

obtain an MDL-panel appointment in TWIA suits in the first instance.

See 667 S.W.3d at 466 (noting that “nothing in § 2210.575 requires

Pruski to have explicitly requested that the MDL Panel appoint a judge

to initiate the statute’s assignment requirement”). We doubt the

Legislature nevertheless intended such a draconian consequence for the

failure to do so.

Chapter 2210’s express purpose, along with the implications of

deeming the MDL-panel appointment to be a jurisdictional requirement,

further militates against such a construction. The Legislature made

express findings that “the provision of adequate windstorm and hail

insurance is necessary to the economic welfare of this state” and that

TWIA “is intended to serve as a residual insurer of last resort for

windstorm and hail insurance in the seacoast territory.” TEX. INS. CODE

7

§ 2210.001. 5 The 2011 amendments serve this purpose by streamlining

the claims process and limiting TWIA’s liability exposure. E.g., id.

§ 2210.014(a) (“A person may not bring a private action against [TWIA],

including a claim against an agent or representative of [TWIA], under

Chapter 541 [bad faith] or 542 [prompt payment of claims].”). If Section

2210.575(e) deprives a district court of jurisdiction over a suit against

TWIA unless the judge is appointed by the MDL panel, a great number

of judgments will be exposed to collateral attack. 6 This will spur more

litigation against TWIA and, in turn, expose it to additional costs and

potential liability for claims that have already been long resolved.

Again, absent a “compelling showing” that the Legislature intended this

result, we will not read jurisdictional consequences into a statutory

requirement. S.C., 650 S.W.3d at 436.

Finally, amicus counsel appointed by this Court to defend the

court of appeals’ judgment 7 argues that the judgment is nevertheless

void because, under Section 2210.575(e), Judge Watts was “statutorily

disqualified” from serving in this case. We disagree. It is true that a

5 The Legislature did not provide an express purpose for its specific

addition of Section 2210.575. However, we construe statutory language in

context, not in a vacuum. TGS-NOPEC Geophysical Co. v. Combs, 340 S.W.3d

432, 439 (Tex. 2011) (“We further consider statutes as a whole rather than

their isolated provisions.”).

6 Amicus curiae, United Policyholders, submitted a brief

“[c]onservatively” estimating that, based on a Lexis search of Texas district

court cases involving TWIA and MDL-panel transfers of such cases, more than

3,600 judgments would be open to collateral attack. We do not opine on the

accuracy of that estimate, though it appears undisputed that the number is

significant.

7 The Court thanks amicus counsel for his service in this case.

8

“disqualified judge has no power to act in the case” and that a judge’s

disqualification is thus a nonwaivable jurisdictional issue. Freedom

Commc’ns, Inc. v. Coronado, 372 S.W.3d 621, 624 (Tex. 2012) (citing

Postal Mut. Indem. Co. v. Ellis, 169 S.W.2d 482, 484 (Tex. 1943)).

However, we cannot agree that the fact that Judge Watts was not

appointed by the MDL Panel “disqualified” her from sitting in the case.

To the extent that Section 2210.575(e) places substantive limitations on

a judge’s qualifications to preside over a TWIA suit—that the judge be

“an active judge” and “a resident of the county in which the loss that is

the basis of the disputed denied coverage occurred or of a first tier

coastal county or a second tier coastal county adjacent to the county in

which that loss occurred”—there is no dispute that Judge Watts met

those qualifications. 8 Certainly, the statutory procedure for assigning a

judge in a suit against TWIA was not followed. But again, failure to

comply with a statute, while it may render a judgment erroneous and

voidable, does not necessarily render the judgment void. Mapco, Inc. v.

Forrest, 795 S.W.2d 700, 703 (Tex. 1990) (“A judgment is void only when

it is apparent that the court rendering the judgment had no jurisdiction

of the parties, no jurisdiction of the subject matter, no jurisdiction to

enter the judgment, or no capacity to act as a court.”).

As a court of general jurisdiction, a district court “presumably

ha[s] subject matter jurisdiction unless a contrary showing is made.”

Subaru of Am., Inc. v. David McDavid Nissan, Inc., 84 S.W.3d 212, 220

8 We need not decide whether a judge who does not meet those

qualifications would deprive the court of subject matter jurisdiction over a suit

against TWIA.

9

(Tex. 2002). 9 For the reasons discussed, no contrary showing was made

here.

In sum, nothing in Section 2210.575(e) or Chapter 2210 more

generally demonstrates clear legislative intent to deprive a district court

of jurisdiction over a suit against TWIA unless the judge is appointed by

the MDL panel. Accordingly, the court of appeals erred in holding that

Section 2210.575(e) is jurisdictional and that the district court was

“without authority” to render judgment in this suit.

B. Disposition

Our holding that the district court had subject matter jurisdiction

does not mean TWIA is entitled to reinstatement of the court’s

judgment. TWIA does not dispute that Section 2210.575(e) is

“mandatory,” nor does it dispute that Judge Watts was not appointed by

the MDL panel as the statute requires. In the court of appeals, TWIA

argued that Pruski waived any complaint that Judge Watts was not

appointed by the MDL panel by (1) failing to petition the panel for

appointment of a different judge and (2) failing to raise the complaint to

Judge Watts until after he filed a motion for summary judgment

requesting that she adjudicate the merits of his claims. See Crosstex,

9 The court of appeals erroneously started with the opposite

presumption—given the statute’s mandatory language, the court looked for,

and failed to find, an indication that the statute does not restrict a trial court’s

authority. 667 S.W.3d at 464–65. Indeed, the court expressly stated that the

presumption that courts of general jurisdiction have subject matter

jurisdiction absent a showing to the contrary “does not apply to actions

grounded in statute rather than the common law.” Id. at 465 (citation omitted).

That statement directly conflicts with our holding in Dubai Petroleum. See 12

S.W.3d at 75.

10

430 S.W.3d at 391 (noting that a party may waive a nonjurisdictional

statutory requirement by failing to timely object and that, under some

circumstances, “substantial invocation of the litigation process may

amount to waiver”). Pruski responded that he brought the

panel-appointment requirement to the district clerk’s attention before

Judge Watts was assigned and raised the matter at the

summary-judgment hearing prior to any ruling.

The court of appeals held that “[b]ecause nothing in [the statute]

requires Pruski to have explicitly requested that the MDL Panel appoint

a judge to initiate the statute’s assignment requirement, we reject

TWIA’s contention that Pruski’s failure to timely file a request for

appointment constituted a waiver of his complaint.” 667 S.W.3d at

466–67. Without specifically addressing TWIA’s second waiver

argument, the court of appeals then concluded that “the presiding judge

was without authority to render judgment in this cause.” Id. at 467.

In this Court, TWIA raises only the issue of whether a district

court’s judgment in a TWIA suit is void if the judge was not appointed

by the MDL panel. Though it passingly refers to the lack of a panel

appointment as a “waived issue,” TWIA does not ask us to reinstate the

judgment on the ground that Pruski waived his complaint by waiting to

raise it with Judge Watts until after he filed a motion for summary

judgment. 10 Nevertheless, the court of appeals’ disposition of this aspect

10 TWIA states in the Summary of Argument sections of its petition and

brief that the court of appeals, by erroneously holding that the judgment is

void, “excused a waived issue on appeal.” However, TWIA presents no

argument and cites no authority in support of its classification of the issue as

11

of TWIA’s waiver argument appears to have been influenced by its

erroneous holding that the district court lacked subject matter

jurisdiction. Pruski, for his part, raises additional issues the court of

appeals did not reach in light of its jurisdictional holding. We conclude

that the best course is to remand the case to the court of appeals to

address those issues, along with TWIA’s remaining waiver argument, in

the first instance.

III. Conclusion

Texas Insurance Code Section 2210.575(e) requires that the trial

judge presiding over a suit against TWIA be appointed by the MDL

panel. While this requirement is mandatory, it is not jurisdictional.

Therefore, in this case, the district court did not lack subject matter

jurisdiction simply because Judge Watts was not so appointed. We

reverse the court of appeals’ judgment and remand the case to that court

for further proceedings.

Debra H. Lehrmann

Justice

OPINION DELIVERED: May 10, 2024

waived. See TEX. R. APP. P. 55.2(i) (“The brief must contain a clear and concise

argument for the contentions made, with appropriate citations to authorities

and to the record.”).

12