No. 03-15-00386-CV

IN THE COURT OF APPEALS 

FOR THE THIRD DISTRICT OF TEXAS 

AT AUSTIN 

HARRIS COUNTY HOSPITAL DISTRICT, 

Appellant 

v.

PUBLIC UTILITY COMMISSION OF TEXAS, 

Appellee 

Appealed from the 250th District Court 

of Travis County, Texas 

Trial Court Cause No. D-1-GN-09-002116 

 

APPELLANT’S BRIEF

 VINCE RYAN 

 Harris County Attorney 

 BRUCE S. POWERS 

 Assistant County Attorney 

 State Bar No. 16215500 

 1019 Congress, 15th Floor 

 Houston, Texas 77002 

 (713) 274-5144 (telephone) 

 (713) 755-8924 (facsimile) 

 bruce.powers@cao.hctx.net

 ATTORNEY FOR APPELLANT 

ORAL ARGUMENT REQUESTED 

ACCEPTED

03-15-00386-CV

6707167

THIRD COURT OF APPEALS

AUSTIN, TEXAS

8/28/2015 3:44:57 PM

JEFFREY D. KYLE

CLERK

 FILED IN 3rd COURT OF APPEALS AUSTIN, TEXAS 8/28/2015 3:44:57 PM JEFFREY D. KYLE Clerk
ii

IDENTITY OF PARTIES AND COUNSEL

The names of all parties and counsel to this appeal are:

Plaintiff/Appellant: Counsel for Plaintiff/Appellant:

Harris County Hospital District Bruce S. Powers

Assistant County Attorney

Randall Raymond Smidt

Assistant County Attorney

1019 Congress, 15th Floor

Houston, Texas 77002

Trial Counsel for Plaintiff/Appellant:

Thomas R. Bray

1431 Wirt Road, Suite 140

Houston, Texas 77055

Edward J. Hennessy

2900 Weslayan, Suite 550

Houston, Texas 77027

Defendant/Appellee: Counsel for Defendant/Appellee:

Public Utility Commission of Texas Elizabeth R. B. Sterling

Assistant Attorney General

Environmental Protection Division

Office of the Attorney General

P.O. Box 12548, MC-066

Austin, Texas 78711-2548
iii

TABLE OF CONTENTS

IDENTITY OF PARTIES AND COUNSEL ........................................................... ii

INDEX OF AUTHORITIES.....................................................................................iv

STATEMENT OF THE CASE..................................................................................1

ISSUES PRESENTED...............................................................................................2

STATEMENT OF FACTS ........................................................................................3

SUMMARY OF THE ARGUMENT ........................................................................5

ARGUMENT.............................................................................................................7

ISSUE NO. 1..............................................................................................................7

WHETHER THE TRIAL COURT ABUSED ITS DISCRETION IN 

FAILING TO CONSIDER THE ISSUE OF FEES FOR THE HOSPITAL 

DISTRICT’S ATTORNEYS AND EXPERT WITNESS AND IN 

RENDERING JUDGMENT DENYING SUCH FEES WITHOUT GIVING 

THE DISTRICT THE OPPORTUNITY TO PRESENT EVIDENCE ON 

THE ISSUE.

ISSUE NO. 2..............................................................................................................7

WHETHER THE TRIAL COURT ERRED IN FINDING THAT THIS 

COURT DECLINED THE DISTRICT’S “CLAIMS” UNDER TEXAS 

UTILITIES CODE § 15.003 IN THE PREVIOUS APPEAL.

PRAYER..................................................................................................................12

CERTIFICATE OF COMPLIANCE.......................................................................13

CERTIFICATE OF SERVICE ................................................................................14

APPENDIX
iv

INDEX OF AUTHORITIES

CASES page

Chessher v. Southwestern Bell Telephone Co., 

658 S.W.2d 563 (Tex. 1983)(per curiam)................................................................12

Harris County Hosp. Dist. v. Public Utility Com’n of Texas, 

No. 03-10-00647-CV, 2012 WL 2989228, at *8 (Tex. App.―Austin 

July 13, 2012, no pet.)(mem. op.)..................................................................1, 3, 4, 9

International Security Life Ins. Co. v. Spray, 

468 S.W.2d 347 (Tex. 1971)......................................................................................9

Jay Petroleum, L.L.C. v. EOG Resources, Inc., 

332 S.W.3d 534 (Tex. App.―Houston [1st Dist.] 2009, pet. denied) ..............10, 11

Southwest Galvanizing, Inc. v. Eagle Fabricators, Inc., 

447 S.W.3d 473 (Tex. App.―Houston [14th Dist.] 2014, no pet.).........................11

Texas Education Agency v. Maxwell, 

937 S.W.2d 621 (Tex. App.―Eastland 1997, writ denied).................................9, 10

STATUTES

Tex. Gov’t Code Ann. § 311.016(2)..........................................................................8

Tex. Util. Code Ann. § 11.003(16)...........................................................................8

Tex. Util. Code Ann. § 11.008...................................................................................8

Tex. Util. Code Ann. §15.003(a) ...........................................................................7, 8

Tex. Util. Code Ann. §15.003(b)...........................................................................8, 9

RULES

Tex. R. App. P. 38.1(g)..............................................................................................3
1

No. 03-15-00386-CV

IN THE COURT OF APPEALS

FOR THE THIRD DISTRICT OF TEXAS

AT AUSTIN

HARRIS COUNTY HOSPITAL DISTRICT, 

Appellant

v.

PUBLIC UTILITY COMMISSION OF TEXAS,

Appellee

Appealed from the 250th District Court

of Travis County, Texas

Trial Court Cause No. D-1-GN-09-002116

APPELLANT’S BRIEF

TO THE HONORABLE COURT OF APPEALS:

STATEMENT OF THE CASE

This is a suit for judicial review of a final order of the Public Utility 

Commission of Texas. (CR 3). In a previous appeal this Court reversed a trial 

court order affirming the Commission’s order and remanded with instructions that 

the case be remanded to the Commission for further proceedings consistent with 

this Court’s opinion. Harris County Hosp. Dist. v. Public Utility Com’n of Texas, 

No. 03-10-00647-CV, 2012 WL 2989228, at *8 (Tex. App.―Austin July 13, 2012, 
2

no pet.)(mem. op.). (CR 71). On remand the trial court signed a final judgment 

which reversed the Commission’s order and remanded the case to the Commission 

for further proceedings consistent with this Court’s opinion. (CR 148). The 

Commission was ordered to pay all costs relating to the appeal and all relief not 

specifically granted was denied. (CR 149). The Hospital District’s Motion for 

New Trial, which included a Motion to Set Attorney’s Fees and Award Attorney’s 

Fees, Expert Witness Fees and other Costs, was denied by operation of law after 

the trial court declined the District’s request for an oral hearing. (CR 151, 225). 

The Hospital District then perfected this appeal. (CR 292).

ISSUES PRESENTED

ISSUE NO. 1

WHETHER THE TRIAL COURT ABUSED ITS DISCRETION IN 

FAILING TO CONSIDER THE ISSUE OF FEES FOR THE HOSPITAL 

DISTRICT’S ATTORNEYS AND EXPERT WITNESS AND IN RENDERING 

JUDGMENT DENYING SUCH FEES WITHOUT GIVING THE DISTRICT 

THE OPPORTUNITY TO PRESENT EVIDENCE ON THE ISSUE.

ISSUE NO. 2

WHETHER THE TRIAL COURT ERRED IN FINDING THAT THIS 

COURT DECLINED THE DISTRICT’S “CLAIMS” UNDER TEXAS 

UTILITIES CODE § 15.003 IN THE PREVIOUS APPEAL.
3

STATEMENT OF FACTS

In the instant case the “facts pertinent to the issues or points presented” all 

relate to the procedural history of the case. Tex. R. App. P. 38.1(g). Those facts 

are these. The Harris County Hospital District prevailed in the previous appeal of 

this proceeding for review. This Court’s mandate in that appeal contained the 

following language:

THIS CAUSE came on to be heard on the record of the court below, 

and the same being considered, because it is the opinion of this Court 

that there was error in the trial court’s judgment: IT IS 

THEREFORE considered, adjudged and ordered that the judgment 

of the trial court is reversed, and that the cause is remanded to the 

trial court with instructions that the case be remanded to the 

Commission for further proceedings consistent with this opinion. It

is FURTHER ordered that the appellee pay all costs relating to this 

appeal, both in this Court and the court below; and that this decision 

be certified below for observance.1

Wherefore, we command you to observe the order of our Court of 

Appeals in this behalf and in all things have the order duly 

recognized, obeyed, and executed. 

(CR 87). The Court’s opinion concluded with the following: 

For these reasons, we conclude that the Commission’s finding 

that “it was appropriate to limit the amount that AT&T should 

refund to the amount of overcharges over the last six and one-half 

years, plus interest” and its corollary decision to order a partial 

refund to be arbitrary and capricious. See id.; Starr Cnty., 584 

S.W.2d at 356. We also conclude that the Commission’s arbitrary 

limitation on the recovery period prejudiced substantial rights of 

the District. See Tex. Gov’t Code Ann. § 2001.174(2). We sustain 

the District’s second and third issues on this basis and need not 

 

1

The Court’s judgment was identically worded. (CR 70).
4

address the District’s remaining arguments and issues.6See Tex. R. 

App. P. 47.1.

CONCLUSION

Because we conclude that the Commission’s order was 

arbitrary and capricious and prejudiced substantial rights of the 

District, we reverse the order of the trial court and remand with 

instructions that the case be remanded to the Commission for 

further proceedings consistent with this opinion.

_____________________________

6

To the extent that the District seeks to have this Court order the 

Commission to adopt the ALJ’s proposal for decision and to award 

it expert’s fees and attorney’s fees, we decline to do so. See Tex. 

Gov’t Code Ann. § 2001.174(2)(West 2008); Tex. Util. Code 

Ann. § 15.003 (West 2007); Ford Motor Co. v. Butnaru, 157 

S.W.3d 142, 149 (Tex. App.―Austin 2005, no pet.)(“In a suit for 

judicial review of an agency action, the reviewing court is 

empowered to issue only a general remand when it finds error that 

prejudices an appellant’s substantial rights.”). 

(CR 84-85).

On remand the Hospital District filed its Motion for Order Remanding 

Overbilling Claims to the Public Utility Commission of Texas and its Motion to 

Sever Claims for Attorney and Expert Fees and Costs, and to Abate the Severed 

Claims. (CR 90, 114). The trial court considered the two motions at a 

nonevidentiary hearing on January 22, 2015. On March 27, 2015, the trial court 

signed the Final Judgment sub judice, which contains the following finding:
5

The Court finds that, although the Court of Appeals reversed this 

Court’s judgment affirming the Commission’s order, the Court of 

Appeals declined the District’s claims under Texas Utilities Code § 

15.003 for attorneys and expert witnesses and other costs for the 

party’s efforts before the Commission and the court. Therefore, 

the Court denies the District’s request to sever that claim into a 

different lawsuit. 

(CR 149.) The trial court denied all relief which was not specifically granted in 

the judgment. (CR 149). As a result, the District’s claim for attorney’s fees and 

expert witness fees was denied. 

SUMMARY OF THE ARGUMENT

Section 15.003 of the Texas Utilities Code provides that a party represented 

by counsel who alleges that existing rates are excessive or that rates prescribed by 

the Commission are excessive and who prevails in a proceeding for review is 

entitled to recover against the regulation fund reasonable fees for attorneys and 

expert witnesses and other costs for the party’s efforts before the Commission and

the court. In this proceeding for review the Hospital District alleged that the “rate” 

that was charged by AT&T during a thirteen year period was unjust and 

unreasonable and therefore improper and prohibited. The District further alleged 

that it is entitled to a refund of the “overbillings” for the entire period of the 

“overcharges”. Therefore, when the District prevailed in the previous appeal of 

this case, it became “entitled” to recover reasonable fees for attorneys and expert 
6

witnesses and other costs. The trial court denied such relief when it signed the 

final judgment in this cause. 

When this case was remanded to the trial court following the previous 

appeal, the Commission argued that any Section 15.003 claim was extinguished in 

the appeal. It based this contention on footnote 6 of this Court’s opinion. 

However, in footnote 6 the Court did not decline the District’s “claims” under 

Texas Utilities Code §15.003. The Court simply declined to award expert’s fees 

and attorney’s fees to the extent that the District sought to have the Court, itself, do 

so. The issue of fees was simply a matter for the trial court to address in the first 

instance. In failing to consider the issue of fees for the District’s attorneys and 

expert witness and in rendering judgment denying such fees without giving the 

District the opportunity to present evidence on the issue, the trial court clearly 

abused its discretion. 

The Hospital District submits that the Commission’s contention that nothing 

in this Court’s opinion, judgment, or mandate allowed the trial court to consider 

the District’s Section 15.003 claim is based on a misinterpretation of the Court’s 

rulings. This Court’s reversal of the trial court’s judgment in the previous appeal 

necessarily made the claim for attorney’s fees and expert witness fees live again. 

Further, the mandate ordered the trial court to certify and observe this Court’s 

decision, which necessarily ordered the trial court to consider the now live claim 
7

for attorney’s fees and expert witness fees. The trial court’s failure to do so was 

contrary to the mandate and was an abuse of discretion.

ARGUMENT

ISSUE NO. 1 (RESTATED)

WHETHER THE TRIAL COURT ABUSED ITS DISCRETION IN 

FAILING TO CONSIDER THE ISSUE OF FEES FOR THE HOSPITAL 

DISTRICT’S ATTORNEYS AND EXPERT WITNESS AND IN RENDERING 

JUDGMENT DENYING SUCH FEES WITHOUT GIVING THE DISTRICT 

THE OPPORTUNITY TO PRESENT EVIDENCE ON THE ISSUE.

ISSUE NO. 2 (RESTATED)

WHETHER THE TRIAL COURT ERRED IN FINDING THAT THIS 

COURT DECLINED THE DISTRICT’S “CLAIMS” UNDER TEXAS 

UTILITIES CODE § 15.003 IN THE PREVIOUS APPEAL.

ARGUMENT AND AUTHORITIES UNDER ISSUES NO. 1 AND 2 

Section 15.003 of the Texas Utilities Code provides that a party represented 

by counsel who alleges that existing rates are excessive or that rates prescribed by 

the Commission are excessive and who prevails in a proceeding for review is 

entitled to recover against the regulation fund reasonable fees for attorneys and 

expert witnesses and other costs for the party’s efforts before the Commission and 

the court. Tex. Util. Code Ann. §15.003(a). As used in Section 15.003 the term 
8

“rate” includes “any compensation, tariff, charge, fare, toll, rental, or classification 

that is directly or indirectly demanded, observed, charged, or collected by a public 

utility for a service.” Tex. Util. Code Ann. § 11.003(16). Section 11.008 of the 

Code provides that Title 2, of which Section 15.003 is a part, “shall be construed 

liberally.” Tex. Util. Code Ann. § 11.008.

In this proceeding for review the Hospital District alleged that the “rate” that 

was charged by AT&T during a thirteen year period was unjust and unreasonable 

and therefore improper and prohibited. The District further alleged that it is 

entitled to a refund of the “overbillings” for the entire period of the “overcharges”. 

(CR 10). Therefore, when the District prevailed in the previous appeal of this case, 

it became “entitled” to recover reasonable fees for attorneys and expert witnesses 

and other costs. Tex. Util. Code Ann. § 15.003(a). The statute provides that in 

that circumstance the court “shall” set the amount of attorney’s fees awarded. Tex. 

Util. Code Ann. §15.003(b).2 Nevertheless, the trial court denied such relief when 

it signed the Final Judgment in this cause. (CR 148, 149).

When this case was remanded to the trial court following the previous 

appeal, the Commission argued that “[a]ny Section 15.003 claim was extinguished 

in the appeal.” It based this contention on footnote 6 of this Court’s opinion. (CR 

124). The Commission further argued that nothing in this Court’s opinion, 

 

2

The Legislature’s use of the word “shall” in the Code “imposes a duty.” Tex. Gov’t Code Ann. 

§ 311.016(2). 
9

judgment or mandate allowed the trial court to consider the District’s Section 

15.003 claim. (CR 124). The trial court apparently accepted these arguments

since it expressly found that this Court “declined the District’s claims under Texas 

Utilities Code §15.003 for attorneys and expert witnesses and other costs.” (CR 

149). However, that was a misinterpretation of footnote 6 of this Court’s opinion. 

In footnote 6 the Court did not decline the District’s “claims” under Texas 

Utilities Code § 15.003. The Court simply declined to award expert’s fees and 

attorney’s fees “to the extent that” the District sought to have the Court, itself, do 

so. Certainly, the Court could not initiate such an award, “since this would be the 

exercise of original rather than appellate jurisdiction.” International Security Life 

Ins. Co. v. Spray, 468 S.W.2d 347, 349 (Tex. 1971). Declining to exercise a 

jurisdiction which the Court did not have did not constitute a ruling on the merits 

of the District’s claim. Moreover, since the Court had just determined that the 

District should prevail in the proceeding for review, the Court would have had no 

reason to deny the District’s entitlement to recover fees under Section 15.003. The 

issue of fees was simply a matter for the trial court to address in the first instance. 

Tex. Util. Code Ann. §15.003(b). In failing to consider the issue of fees for the 

District’s attorneys and expert witness and in rendering judgment denying such 

fees without giving the District the opportunity to present evidence on the issue, 

the trial court clearly abused its discretion. Compare Texas Education Agency v. 
10

Maxwell, 937 S.W.2d 621, 623 (Tex. App.―Eastland 1997, writ denied)(“We hold 

that the trial court abused its discretion in failing to consider the issue of attorney’s 

fees and in rendering judgment denying attorney’s fees without giving plaintiffs 

the opportunity to present evidence on the issue.”)(case brought under 42 U.S.C. § 

1983). 

The Hospital District submits that the Commission’s contention that nothing 

in this Court’s opinion, judgment, or mandate allowed the trial court to consider 

the District’s Section 15.003 claim is also based on a misinterpretation of the 

Court’s rulings. In that regard, this case is similar to the procedural circumstances 

described in Jay Petroleum, L.L.C. v. EOG Resources, Inc., 332 S.W.3d 534 (Tex. 

App.―Houston [1st Dist.] 2009, pet. denied). In a prior appeal of that case the 

court of appeals had reversed the judgment of the trial court, stating, “The trial 

court erred by granting Jay’s motion for final summary judgment on its breach of 

contract and conversion claims, and by denying EOG’s motion for partial summary 

judgment.” Id. at 537. The court’s mandate stated the following:

“The cause heard today by the Court is an appeal from the judgment 

signed by the court below on February 17, 2003. After submitting the 

cause and inspecting the record of the court below, it is the opinion of 

this Court that there was reversible error in the judgment. It is 

therefore CONSIDERED, ADJUDGED, and ORDERED that the 

judgment of the court below be in all things reversed and that 

judgment be rendered that the partial summary judgment of appellant, 

EOG RESOURCES, INC., be granted and that the motion for final 

summary judgment by appellee, JAY PETROLEUM, L.L.C., be 
11

denied, and that appellee, JAY PETROLEUM, L.L.C., take nothing 

on its claims against appellant, EOG RESOURCES, INC. 

It is further ORDERED that the appellee, JAY PETROLEUM, L.L.C.,

pay all costs incurred by reason of this appeal. 

It is further ORDERED that this decision be certified below for 

observance.”

 

Id. On remand the trial court granted EOG’s motion for summary judgment and 

awarded EOG its attorney’s fees. On the second appeal Jay Petroleum contended 

that the mandate did not remand the case to the trial court. However, the court of 

appeals said the following:

“The mandate plainly reversed the summary judgment on the counterclaims, which necessarily made those counterclaims live. Moreover, 

the mandate ordered the trial court to certify and observe our decision, 

which necessarily ordered the trial court to consider the now live 

claims.” 

Id. at 540. The court therefore overruled Jay Petroleum’s issues concerning 

waiver, res judicata and lack of jurisdiction. Id. at 540-542. 

Similarly, in the instant case, this Court’s reversal of the trial court’s 

judgment in the previous appeal necessarily made the claim for attorney’s fees and 

expert witness fees live again. Further, the mandate ordered the trial court to 

certify and observe this Court’s decision, which necessarily ordered the trial court 

to consider the now live claim for attorney’s fees and expert witness fees. Id. The 

trial court’s failure to do so was contrary to the mandate and was an abuse of 

discretion. Southwest Galvanizing, Inc. v. Eagle Fabricators, Inc., 447 S.W.3d 
12

473, 478 (Tex. App.―Houston [14th Dist.] 2014, no pet.)(“After this court 

directed its mandate to the trial court, the trial court had jurisdiction to enforce our 

mandate. The trial court, however, had no discretion but to enforce it; signing an 

order contrary to our mandate would be an abuse of discretion.”)(citation omitted). 

The trial court denied the District’s claim for attorney’s fees and expert witness 

fees sua sponte. The Commission had filed no motion seeking the dismissal of the 

claim. The trial court clearly erred in proceeding to the rendition of a final 

judgment which summarily denied the requested relief in that circumstance. 

Compare Chessher v. Southwestern Bell Telephone Co., 658 S.W.2d 563, 564 

(Tex. 1983)(per curiam)(“It is axiomatic that one may not be granted judgment as a 

matter of law on a cause of action not addressed in a summary judgment 

proceeding.”).

PRAYER

WHEREFORE, PREMISES CONSIDERED, Appellant Harris County 

Hospital District respectfully prays that the portion of the trial court’s judgment 

which denied the District’s claim for attorney’s fees and expert witness fees be 

reversed and remanded with instructions that the trial court conduct a hearing to 

determine the amount of reasonable attorney’s fees and expert witness fees which 

should be awarded to the District. 
13

Respectfully submitted,

VINCE RYAN

Harris County Attorney

/s/ Bruce S. Powers

Bruce S. Powers

Assistant County Attorney

State Bar No. 16215500

1019 Congress, 15th Floor

Houston, Texas 77002

(713) 274-5144 (telephone)

(713) 755-8924 (facsimile)

bruce.powers@cao.hctx.net

ATTORNEY FOR APPELLANT

CERTIFICATE OF COMPLIANCE

The undersigned attorney certifies that this document complies with the 

word-count limitations of Tex. R. App. P. 9.4. Relying on the word count of the 

computer program used to prepare this document, it contains 2,740 words.

/s/ Bruce S. Powers

Bruce S. Powers

Assistant Harris County Attorney
14

CERTIFICATE OF SERVICE

I hereby certify that on this the 28th day of August, 2015, a true and correct 

copy of the foregoing APPELLANT’S BRIEF was served electronically upon 

Defendant Public Utility Commission of Texas’ counsel, Elizabeth R. B. Sterling, 

Assistant Attorney General, Environmental Protection Division, Office of the 

Attorney General, P.O. Box 12548, MC-066, Austin, Texas 78711-2548.

/s/ Bruce S. Powers

Bruce S. Powers

Assistant County Attorney
APPENDIX
Table of Contents

Tab No. Description

1 Final Judgment

2 Tex. Util. Code Ann. §15.003
Tab 1

Final Judgment



Tab 2

Tex. Util. Code Ann. §15.003
§ 15.003. Costs and Attorney's Fees, TX UTIL § 15.003

 © 2015 Thomson Reuters. No claim to original U.S. Government Works. 1

Vernon's Texas Statutes and Codes Annotated

Utilities Code (Refs & Annos)

Title 2. Public Utility Regulatory Act

Subtitle A. Provisions Applicable to All Utilities

Chapter 15. Judicial Review, Enforcement, and Penalties (Refs & Annos)

Subchapter A. Judicial Review

V.T.C.A., Utilities Code § 15.003

§ 15.003. Costs and Attorney's Fees

Currentness

(a) A party represented by counsel who alleges that existing rates are excessive or that rates

prescribed by the commission are excessive and who prevails in a proceeding for review of a

commission order or decision is entitled in the same action to recover against the regulation fund

reasonable fees for attorneys and expert witnesses and other costs for the party's efforts before the

commission and the court.

(b) The court shall set the amount of attorney's fees awarded under Subsection (a).

(c) If a court finds that an action under Section 15.001 or this section was groundless and brought

in bad faith and for the purpose of harassment, the court may award reasonable attorney's fees to

the defendant public utility.

Credits

Acts 1997, 75th Leg., ch. 166, § 1, eff. Sept. 1, 1997.

V. T. C. A., Utilities Code § 15.003, TX UTIL § 15.003

Current through Chapters effective immediately through Chapter 46 of the 2015 Regular Session

of the 84th Legislature

End of Document © 2015 Thomson Reuters. No claim to original U.S. Government Works.