Reverse d and Remanded and Memorandum Opinion filed July 18 , 2024.

In The 

## Fourteenth Court of Appeals

NO. 14

- 23

- 00218

- CV

TINA DAHL D/B/A SOUTH TEXAS CONSTRUCTORS, TODD DAHL , AND TED DAHL , Appellant s
V.

VILLAGE OF SURFSIDE BEACH , Appellee

On Appeal from the 239 th District Court Brazoria County, Texas Trial Court Cause No. 108607

MEMORANDUM OPINION
Appellants To dd Dahl, Ted Dahl, and Tina Dahl d/b/a S o uth Texas
Constructors appeal a plea to the jurisdiction granted in favor of appellee the Village o f Surf side B e ach ( “ the City ” ). In one issue , appellants argue the trial court
erred when it grante d the City ’ s plea to the jurisdiction. We revers e and remand for
further p roceedings

.2 I. B ACKGROUND

A ppellants filed a law suit against the City , alleging t h at T odd filled o u t a Surfside Utility Service Agreement 1 requesting a water connection for re al propert y where appellants were bu ilding a house. Appellants allege that the City ’ s ordina nce § 48

- 44 ( “ Tapping fees ” ) require s the City to pay the pro rated costs of
the f irst 100 feet of the exten sion from the C i ty waterline to the ir property line

. According to appellants, the City refused to us e an obvious route of less than 100 feet, instead choosing a much longer route requ iring Appellants to pay $4,000 .00
before r unn i ng the waterline

. Appellants allege that “ [a ]fter several visits to city hall, city officials eventual l y required [a ppellants] to pay $4,000 .00 , which they paid under prote st ” for the water connection.
Appellants asserted claims for mon ey h a d and r e ce ived and restitution , seeking “ to recov er from the City the $4,000. 00 that the City required them to pay under protest before th e water would be connected

. ” Appellants also requested a declarator y j udgment , seeking a determination tha t appe llant s “ are not required to

pa y the entire a mo unt of the expense in hav ing the water lines run to the property where they are building a house. ”

T he City filed an answer and ass erted governmental im munity f rom all of appellants ’ claims. App ellan t s filed a response argui ng that : (1) the City ’ s imm unity was waived pursu ant to Texas Civil Practice and Remedies Code § 101.0215(a)(32) because the City is liable for damages arising from its governmental functions, including water and s ewer service s and ( 2) there w as no immunity when a m unicipali t y is sued see king a declaration of the party ’ s rights
under a m un i cipal ordi nan ce

. See Tex. Civ. Prac. & Rem. Code Ann. § § 37. 004(a) , 101.0215

.

1 The agreement i s not in the record.3 On Mar ch 3 0, 2023, t he t rial court signed an order di smiss i ng appellan ts ’
claims with prejudi ce for lac k of juris diction based on governmental immunity

. This a ppeal fol lowed.

II. D IS CUSSION In their sole issue, appellant s argue the trial court erred when it granted the City ’ s plea to the jurisdiction be cause the City ’ s immunity was waived as to th eir

c l aims for mone y had and received , and for restitution pursuant to Texas Civ il
Prac tice and Remedies Code § 101 .0215( a)(32 ). See Tex. Civ. Prac. & Rem. Code Ann. § 101.0215(a)(32 ) ( “ A mun i cipality is liable under this chapter for dam a ges arisi ng from its g overnmental functions , . . . including but not limi ted to

. . . water and s ewer se rvice

. . . . ” ). Appellants further argue that the City ’ s i mmunity was
waived as to their declarato r y jud g ment action because “ when a party sues a municipality for a de clara t ion regar ding his or her rights under a m unicipal ordinance, there is no governmental immunity. ”

A. S TAND ARD OF R EVIEW

Governmental immu nity shields municipal ities f r om suit unle s s the state waives immunity. Alamo He ights Indep. Sch

. Dist. v. Clark , 54 4 S .W.3d 755, 770 (Tex. 2018). Immunity from suit may be asserted through a plea to the jurisdiction
that cha llenges the pleadings, the exis tence of jurisdictiona l facts , or both. Id

. A plea to the jurisdiction is a dila tory plea used t o defeat a cause of act ion without regard to whether the claims asserted have merit. Bland Indep. Sch. Dist. v. Blue , 34 S.W.3d 5 47, 554 (Tex. 2000). The plea c hallenges the trial co urt ’ s

s u bject

- matter jurisdiction. Id. Whether a trial cou rt has subject

- m atter juri s diction

a nd whether the pleader has alleged facts that affirmatively demonstrate the trial

court ’ s subject

- matter juri sdiction are questions of law t hat we review de novo.4 Tex. D e p ’ t of Parks & Wildlife v. Miranda , 133 S.W.3d 217 , 226 (Tex. 2004 ).
The pla i ntiff has th e initial burden to plead facts affirmatively showing that the trial court has jurisdiction. Tex. Ass ’ n of Bus. v. Tex. Air Control Bd. , 852 S.W.2d 440, 446 (T ex. 199 3 )

. 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. W e construe the pleadings liberally in f avor of the plaintiffs and lo o k to the pleader ’ s intent. If the pleadings do not contain sufficient facts t o demonstrat e the tria l court ’ s jurisdiction
but do not affi rmatively demons trate incurable d efects in jurisdiction, then the issue is one of pleadin g sufficiency and the plaint i f f should be afforded the opportunity to amend. Miranda , 133 S.W.3d at 226

– 2 7 . If the plea dings
aff i rmatively negate the existence of jur isdiction, then a plea to the j urisdict ion may be granted without allowing the plaintiff an opportunity to ame nd. Id

. B. A PP LICABLE L AW Governmental immunity shields municipalities from suits a r ising from

per formance of their “governm ent al” but not “pro prietary” functions. City of
Aus tin v. Utility Assocs. , 517 S.W.3d 300, 307 (Tex. App.

— Aus tin 2017, pet. denied) ; see W a sson Interests, Ltd. v. City of Jacksonville , 489 S.W.3d 427, 439 (Tex. 2016 ) ( “ Wasson I ” )

. Courts disti nguish between governmental and proprietary functions because cities have no inherent immunity , but derive their
immuni t y f rom the state. City of Hous t o n v. Williams , 3 53 S.W.3d 128, 134 (Tex. 2011). As a result, “a city is cloak e d in the stat e ’ s immunity w hen it acts as a branch of the state, but only when it acts as a branch of the state.” Wasson I , 4 8 9
S.W.3d at 436.

Gen era lly speaking, a city ’ s gove r n m ental functions are those acts it performs as the agent of the state in f urt h erance of gen eral law for the interest of5 the public at large. Id. at 436

. P roprietary functions, in contrast, are those

per f ormed by a city, in its discretion, pri marily for t h e benefit of tho se within the corporate limits of the municipality. Id. at 433

– 34

. In enacti ng the Texas Tort Claim s Act ( “ TTCA ” ) , the Legislature
reclassified certain proprietary functions as government a l. See Tex. Civ. Pra c. & Rem. Code § 101.021 5; see a l s o City of Tyle r v. Likes , 962 S.W.2d 489, 503 (Tex. 1997) (noting that TTCA r eclassified m aintenance of storm sewers as a
governm ental function even though it was considered a propriety funct ion at

com m on law)

. The TTCA ap plie s to tort claims, but court s d etermining w he ther immunity applies in the contract

- claims context “should b e guide d

. . . by the
TTCA ’ s treatment of the proprietary

- governmental dist inction.” Wasson I , 489
S.W.3d at 439. Courts dete r mine whether immunit y ap plies in this context by

ex a m i ning “wheth er the municipality was engaged in a gov ernmental or proprietary f unction when it entered the contract, not when it allegedly breached
th e contract.” Wasson Interests, Ltd. v. City of Jackso n ville , 559 S.W.3d 14 2, 1 49 (Tex. 2018) ( “ Wasso n II ” )

. Th e TTCA expr essly waives sovereign immunity for:
(1) property damage, pers o nal injury, a nd death proximately caused by the wrongful act or omission or the negligence of an employee acting within his s cope of employment i f: ( A) the property damage , per s o n a l injury, or death arises from the operation or us e of a motor

- driven vehic l e o r motor

- dr iven equipment; and (B) the employee would be personally liable to the claimant according to Texas law; and (2) personal injury and deat h so caused by a condi tion o r u se of tangibl e personal or real property if the go vernmental unit would,

we r e i t a privat e person, be liable to the claimant according to Texas law.6 Tex. C iv. Prac. & R em. Code Ann. § 101.0 21(1); see C ounty of Cameron v. Brow n , 80 S.W.3d 549, 554 (Tex. 2 0 0 2) (quoting T ex. Dep ’ t of Transp. v. Able , 35
S.W. 3d 608, 611 (Tex. 2000)).

C. A NALYSIS

1

. Money Had and Received & Restitution C laims

Here , appellants alleged they entered into an agreement with the Ci t y for the provisio n o f w ater lines and s ervice to re a l p roperty where appellants were building a home. The Legi s la ture has provid ed that “ wate r and s ewer service ” is a governmental function of the City

. See Tex. Civ. Prac. & Rem. Code Ann. § 10 1 .0215(a)(32 ) (defi ning governmental function s to i n clude water a n d se wer service); Wasson I , 489 S.W.3d at 439

. T he services appellants comp la ined of are thus government al functions for which the Cit y has i mmunity. See Tex. Civ. Prac.
& R e m. Code Ann. § 101 .0215(a)(32 ) ; see also Wasson I , 489 S.W.3d at 43 9 (noting tha t wh ether immunity applies in contract claims “should be guide d

. . . by
the TTCA ’ s treatm ent of the p roprietary

- governmental dis t inction ” )

. A ppellants a rgue that the City ’ s i mmunity is waiv ed as to their claims for

m oney had and rece ived and r estitution p u r su ant to Texas Civil Prac tice and
Remedies Code § 101.0215

. However, the waiver of immun ity in § 1 0 1.0215 is
limited to “ unde r this chapter. ” See T ex. Civ. Prac. & Rem. Code Ann. § 101.0215 (a) ( “ A municipality is liable under this chapter fo r damages ari s i ng from its governmental functions

. . . . ” ). Section 101.0 215 is a waiver of immunity
f

o r tort cla ims for property dam age, personal inju ry, or death. Appellants have not

as serted any such claim . Thus, we reject their argument that the City ’ s imm un ity is

w aived based on § 101. 0215 and the TTCA

. See i d

. § 101.0215(a)(32 ) ; Wasson I , 489 S.W.3d at 439 ; see also , e.g. , Holms v. W. Travis Cnty. Pub. Util. Agency , N o. 13

- 17

- 00584

- C V, 2019 WL 1141870, at *3 (Tex. App.

— Austin Mar 13, 2019, no7 pet.) ( m em

. op

. ) ( “ [ B ] ecause Holms does not allege ‘ property damage , personal injury , [or] death, ’ WTCPUA is n ot lia ble ‘ under this chapter, ’ regar dless of
wh eth er it was engaged in provided ‘ wat er and s ew er service. ’ ” )

. 2. Declaratory

- Judgment Claim

T he Uni form D eclara tory J u d gment Act ( “ UDJ A ” ) permits interested persons to a contract whose rights are affected to have determin ed a ny question of
construction or validity arising under an or dinance or a contract , either before or
after the breach

. Tex. Civ. Prac. & R em. Code Ann

. § 37.004(a). 2 Appellants argue
that the UD JA waives immunity “ when a party sues a mu nici pality for a
de clara tion regarding his or her rig h ts under a m unicipal ordinance, th ere is no

gove rnmental immunity. ”
Contrary to a p pellants ’ ar g u ment, t he UDJA waives immunity f or claims challenging the validity of ordinances or statutes when th e municip ali ty is made a party to the lawsuit

. See id

. § 37.006(b) (“In any proceeding that involves the validity of a municipal ordinance or franchise, t h e municipality must be made a party and is entitled to be heard, and if the statut e, ordinance, or fr anchise i s alleg ed to be unconstituti o nal, the attor ney general of the s tate must also be served with a copy of the proceeding and is entitle d to be heard

. ” ); City of El Paso v.
Heinrich , 284 S.W.3d 366, 37 3 n.6 (Tex. 2009) ; Wichita Fall s S tate Hosp. v.
Ta ylor , 106 S. W.3d 692, 697

– 698 (Tex. 2 0 03) ; Tex. Educ. Agency v. Leeper , 893
S.W. 2d 432 , 446 (Tex. 1994)

. Here, appellants do not seek a de cla r ation that t h e

2 “ A p er son intereste d und er a deed, will, written contract, or other writings constituting a contract or whose righ ts, status, or other legal r elations are affected by a statute, municipal ordinance, contract, or franchise may have determined any question of co ns truction or v alidi ty arising under the instrument, statute, ordinance, contract, or franchise and obtain a d eclaration of rights, status , or other legal rela tion s thereunde r. ” Tex. Civ. Prac. & Rem. Code Ann. § 37.004 (a).8 City ’ s ordin ance § 48

- 44 is inv alid ; instead, appellant s challeng e actions taken pursuant to the ordina nce

. Thus, we reject appellants ’ claim t hat the City ’ s im munity is w aived pursuant to th e UDJA

. See Tex. Civ. Prac. & Rem. Code Ann. § 37

. 006(b) ; City o f El Paso , 284 S.W.3d at 37 3 n.6

. We overrule appellant s ’ issue on appeal

. 3. Opportun i ty to Amend Pleadings
Never theless, we conclude tha t ap p ellants deserve an opportuni ty to amend
their pe tition if the jurisdictional defects can be cured

. See Tex. A& M Univ. Sys. v

. Kose oglu , 223 S.W .3d 8 35, 84 6 (Tex. 2007) ; Miranda , 133 S.W .3d at 226

– 27

. T h ere is “a narrow e x ception to immunity when a plainti f f seeks reimbursement of

an allegedly unlawful t a x, fee, or penalty that was paid involuntar ily a n d under
dure s s

. ” Garcia v. City of Willis , 593 S.W.3d 201, 20 9 (Tex. 2019) ; see Saturn Cap. Corp. v. Cit y of Hous. , 246 S.W .3d 242, 245 (Tex. App.

— Houston [14th Dist.] 2007, pet. denied ) (“[S]overeign immunity doe s not prevent a pa rty who paid illegal gov e rnment tax e s a nd fees under duress from filing a lawsuit to seek their repayment.”) ; see also Dall. Cm ty. Coll. Dist. v. Bo lton , 185 S.W.3d 868, 876 (Tex. 2005) (cataloging precedents on “ duress and voluntary payments to government entities ” that “ extend i nto the nine t e enth cent ury ” )

. This is because mon ey c ollected from an illegal tax, f ee, or penalty should
not be treated a s the mu n icipality ’ s property and su bject to immunity; instead, the illegally collected t a x, fee, or penalty should be refunded if p a id be cause o f f ra ud, mutual mistake of fact, o r du ress , without respect to waiver of sovereign immunity.
Nivens v. City o f League Ci ty , 245 S.W.3d 470, 474 (Te x. App.

— Houston [14th Dist.] 2007 , pet. denied )

. “No l egislative consent to sue is needed under t hese
circums t an ces.” Id.
A common element of duress in all its forms is improper or unlawful9 conduct or threat of improper or unlawful conduct that is intended to and does interfere with another person ’ s exercise of free will and judgment. Garcia v . City

o

f W illis , 5 9 3 S.W

. 3d 201, 209 (Tex. 2019 ) . This com pulsion must be actual and imminent, and not merely feigned or imagined

. Id

. The Supreme Court of Texas
has repeatedly held that duress is established where the unauthorized tax or fee is

“ required, ” “ nec e ssary, ” or “ s h all ” be paid to avoid the government ’ s ability to charge penalties or halt a person from earning a livelihood or operating a business.
Id. “Succinctly, the decision faced ‘is to comply or close up.’ ” Id. (quoting Dall.
Cm ty. Coll. Dist. , 185 S.W.3d at 8 7 9 ) ; s ee also Dall. C nty

. C mty. Coll. Dist. , 185
S.W.3d at 877 ( “ [A] person who pays a tax voluntarily and witho ut duress does not have a v alid claim for its repayment even i f the tax is later held to be unlawful. ” ).

A ppellants ’ petition alle g e d the City ’ s o rdinance st ates:
Sec. 48

- 44.
– Tapping fees (a) The village shal l charge a ll customers of its water system t he tap fees in subsection (c) of this se ction for the installation of water service, w here the village ’ s water mains are availa ble a t the proper t y line of t he customer.

. . . . ( d) If the village ’ s water line is not lo cated at the property line, the villa ge shall pay the prorated costs for the f irst 100 feet of any extension to the property line, and the prope rty owner shall pay the b a l ance of su c h expense. Appellants ’ petition f u rther alleges :
Part d of the abov e secti on requires the City to pay the prora ted costs for the first 100 feet of the e xtension to the property where Plaintiffs

were building a house. T here was an obvious less

- t h an 100 fee t r oute from a City waterline to t h e construction site that the City refuse d to use when running the requested w aterline. Inst ead, the City ran the water line a much longer distance and required Plaintiffs to pay $4,000 before running the w ater l i n e, which P l a i ntiffs paid under protest. The

o rdinance does not allow the City to take a longer route when a short10 route will do unless t he City is willing to pay f or the extra cost of doing so itself. Therefore, Plaintiffs sue to recover the $4,000 they pa id under p rot est. Importantly, appel l ants allege in their petition tha t the o rdinance “does not allow ” for the City to tak e a longer route when a short rou te will suffice unless the City is willing to pay for the extra cost of the longe r route, and that a pp e ll ants paid “under protest

. ”
Appella nts , as plaintiffs , have the initial burden to plead facts affirmatively showing that the trial court has jurisdiction. Tex. Ass ’n of Bus. , 852 S.W.2d at 446

. The facts pl eaded here do not show that appellan t s have in voke d the trial court ’ s jurisdiction under this narrow exception; appellan ts do not alleg e t hat they p aid the
fees under b usi n es s compulsion, duress, fraud, or mutual mistak e

. See Dall

. Cn ty. Cmty. Coll. Dist. v. B olton , 185 S.W.3d 868, 877

– 79 (T e x. 2005) (sta ting that the Texas Supreme Cour t has “consistently recognized business compulsion aris ing from pa yment of government fe es and taxes coerced by financial penalties, loss of livelihood, or substantial damage to a business,” and that reimbursem e nt of ill egal
fees and tax es is allowed, in e ssence, when the public entity compels compliance
with a void law and subjects the pe r so n t o punishment if he refuses or fails to comply) ; Crow v. City of C orpus Christi , 209 S.W .2d 922, 924

– 25 (Tex. 1948) (dis c ussing bu sine ss compulsion and duress with re gard to cases in which
businesses were faced with eithe r paying il legal fees or forfe i ti ng their right to do business); Tara Partners, Lt d. v. City of S. Ho us ton , 282 S.W.3d 564, 577 (Tex. App.

— Houston [14th Di s t.] 2009, pet . denied) ( “ [W]here a claim for declaratory or injunctive relief is brought seeking the refund of illega lly collected ta x
p ayments, governmental immunity will not apply i f the taxpayer all eges that the payments were made as a result of fraud, mutual mi stak e of fact, or duress,
whether ex press or implied .”); Saturn Capital Corp. v. City of Ho uston , 24611 S.W.3d 242, 246 (Te x

. Ap p.— Houston [14th Dist.] 2007, pet. denied) (des c ribing
duress nece ssary to authorize ill egal

- fee recovery as “when the

un authorize d . . . fee is required, necessary, or shall be paid to avoid the government ’ s ability to charge penalties or halt a perso n fr om earning a living or operating a business”); Ni v ens , 245 S.W.3d at 474

– 75 (holding that the trial court did not err by g r anting th e ci ty ’ s jurisdictional plea when pl ai ntiffs ’ pleadings failed to seek declaratory or injun ctive relief regarding refund of ex c essive tax payments and failed to allege that t hey made any payments as a result of fra ud, mutual mistake of fact, or du ress ) ; se e al so Dal l. Cnty. C mty. Coll . Dist. , 185
S.W .3d at 876

– 79 (holding that a taxpayer cannot bring a sui t for the return o f
ille g ally collected taxes if the payments were made voluntari ly ). While appell ants allege that they paid the tapping fee “ un d er p rotes t,” appellants ’ petition does not allege any facts showing that they were prevented from earning a livelihood or operati ng a business

. Se e Garcia , 5 93 S.W

. 3d at 209 ; Dall. C nty . C mty. Coll. Dist. , 185 S.W.3d at 877

.
B eca use appellants ’ plead i ngs are insuf ficie nt to establish jurisdiction but do

not affirm atively demonstrate an incurable jurisdi ctional defect , we conclude t h at appellants should be affor ded th e op portunity to amend their pleadings. S ee Mi r anda , 133 S.W .3d a t 226

– 27; see also Tu r ner v. Robins on , 5 34 S.W.3d 115,
127 (Tex. App.

— Houston [14th Dist.] 2017 , pet. denied) ( concluding that even though appellees challe n ged actions t aken under the o rdi nan ce, immunity was
waiv ed for appellees ’ declara t ory claim because appellee s also sought a d e claration

as t o the ordinance ’ s validity)

. If appellants a re unable to plead facts curing the jurisd ictional defects, then appell a nts ’ claims will b e barred by gove r nmental immunity and should be di smissed. See Mi r anda , 133 S.W .3d at 226

– 27

.12 III. C ONCLUSIO N

We conclude that the facts al leged in appellants ’ petition are insufficient to support the trial court ’ s ju risdict ion bu t do not affi rmatively demonst ra te an i ncurabl e jurisdiction al defect. Therefore, we reverse the tria l co u rt ’ s order and
remand for fu r ther proce edi ngs c onsistent with this opinion

.

/s/ Margar et “ Me g ” Poissant Just ice

Panel con sist s of Ju stices Hassan, Poissant , and W ilson

.