## No. 03

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IN THE THIRD COURT OF APPEALS AUSTIN, TEXAS

APPELLANTS, CPS ENERGY, TIME WARNER CABLE TEXAS LLC, AND SOUTHWESTERN BELL TELEPHONE COMPANY
D/B/A AT&T// CROSS

- APPELLANT, PUBLIC UTILITY
COMMISSION OF TEXAS

V.

APPELLEE, PUBLIC UTILITY COMMISSION OF TEXAS// CROSS

APPELLEE, CPS ENERGY, TIME WARNER CABLE TEXAS LLC

AND SOUTHWESTERN BELL TELEPHONE COMPANY D/B/A
AT&T

On appeal from D -1-GN- 13

- 001238 (Consol idated)
in the 250 th 

## Judicial District Court, Travis County, Texas

POST SUBMISSION BRIEF OF APPELLANT CPS ENERGY

CPS ENERGY

Gabriel Garcia ggarcia@cpsenergy.com Carolyn She l lman
cshe l lman@cpsenergy.com

CPS Energy
145 Navarro
P.O. Box 1771 San Antonio, Texas 78296 (210) 353

- 5689 (Voice) (210) 353

- 6832 (Facsimile) HERRERA & BOYLE, PLLC

Alfred R. Herrera
State Bar No. 09529600 aherrera@herreraboylelaw.com

816 Congress Avenue, Suite 1250 Austin, Texas 78701 (512) 474

- 1492 (Voice) (512) 474

- 2507 (Facsimile)

May 8 , 2015 ACCEPTED
03-14-00340-CV
5210597 THIRD COURT OF APPEALS

AUSTIN, TEXAS
5/8/2015 12:32:17 PM
JEFFREY D. KYLE

CLERK

# IDENTITY OF PARTIES AND COUNS EL

The following is a complete list of all parties to the trial court’s judgment,

and the names and addresses of all trial and appellate counsel:

Counsel for Public Utility Commission
of Texas:

Douglas Fraser Megan Neal
Office of the Attorney General P.O. Box 12548, Capitol Station Austin, Texas 78711

- 02548 Phone: (512) 463

- 2012 Fax: (512) 457

- 4610 douglas.fraser@texasattorneygeneral.gov megan.neal@texasattorneygeneral.gov Counsel for CPS Energy:

Alfred R. Herrera HERRERA & BOYLE, PLLC 816 Congress Avenue, Suite 1250 Austin, TX 78701 Phone: (512) 474

- 1492 Fax: (512) 474

- 2507 aherrera@herreraboylelaw.com

Counsel for AT&T Texas:

Paul A. Drummond
Natalie L. Hall AT&T Legal Department 1010 N. St. Mary’s, 14 th 

## Floor San Antonio, Texas 78215 Phone: (210) 351

- 4830 Fax: ( 210) 886

- 2127 paul.drummond@att.com
natalie.hall@att.com Counsel for CPS Energy:

Gabriel Garcia Carolyn Shel l man CPS Energy
145 Navarro
P.O. Box 1771 San Antonio, TX 78296 Phone: (210) 353

- 5689 Fax: (210) 353

- 6832 ggarcia @cpsenergy.com cshellman@cpsenergy.com

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APPELLANT CPS ENERGY’S POST SUBMISSION BRIEF i

## Counsel for AT&T Texas:

Michael T. Sullivan Mayer Brown LLP
71 S. Wacker Drive Chicago, IL 60606 Phone: (312) 782

- 0600 Fax: (312) 706

- 8689 msullivan@mayerbrown.com Counsel for AT&T Texas:

J. David Tate
Katherine C. Swaller
Thomas Ballo AT&T Legal Department 816 Congress Avenue, Suite 1100 Austin, Texas 78701 Phone: (512) 457

- 2304 Fax: (512) 870

- 3420 jon.david.tate@att.com
katherine .swaller@att.com
thomas.ballo@att.com

Counsel for Time Warner Cable Texas
LLC:

Valerie P. Kirk
Melissa Lorber
Enoch Kever PLLC 600 Congress Avenue, Suite 2800 Austin, Texas 78701 Phone: (512) 615

- 1200 Fax: (512) 615

- 1198
vkirk@enochkever.com
mlorber@enochkever.com Counsel for Time Warner Cable
Texas LLC:

J.D. Thomas J. Aaron George Sheppard Mullin Richter & Hampton LLP 1300 I Street, N.W.

11 th 

## Floor East Washington DC 20005 Phone: (202) 218

- 0000 Fax: (202) w 218

- 0020 dthomas@sheppardmullin.com

ageorge @sheppardmu llin.com

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APPELLANT CPS ENERGY’S POST SUBMISSION BRIEF ii

# TABLE OF CONTENTS

IDENTITY OF PARTIES AND COUNSEL

................................ .................. i

TABLE OF CONTENTS

................................ ................................ ............... iii

INDEX OF AUTHORITIES

................................ ................................ ......... iv

STATEMENT OF FACTS

................................ ................................ .............. 1

SUMMARY OF ARGUMENT

................................ ................................ ....... 2

ARGUMENT

................................ ................................ ................................ ... 3

Findings of Fact 84

- 87 and Conclusions of Law 26 and 27 are

Improper Advisory Opinions

................................ ................................ ....... 3

The Uniform Declaratory Judgment Act does not Apply to this Case

........ 7

Findings of Fact 84

- 87 and Conclusions of Law 26 and 27 Result in

an Unconstitutional Delegation of Power

................................ .................... 9

CONCLUSION

................................ ................................ ................................ 9

CERTIFICATE OF SERVICE

................................ ................................ ..... 11

CERTIFICATE OF COMPLIANCE

................................ ............................ 12

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APPELLANT CPS ENERGY’S POST SUBMISSION BRIEF iii

# INDEX OF AUTHORITIES

Cases

Brinkley v. Texas Lottery Comm'n , 986 S.W.2d 767 (Tex. App.

— Austin 1999, no pet.)

................................ ................................ ........ 4, 5

Central Power & Light Co. v. Public Util. Comm'n , 36 S.W.3d 547 (Tex.App.

- Austin 2000, pet. denied)

................................ .................... 7

City of Waco v. Tex. Nat. Res. Conservation Comm'n , 83 S.W.3d 169 (Tex. App.

— Austin 2002, pet. denied)

................................ ............ 5, 8

Firemen's Ins. Co. v. Burch, 442 S.W.2d 331 (Tex. 1969)

............................ 8

Railroad Comm'n v. CenterPoint Energy Res. Corp. , 03

– 13

– 00533

– CV, 2014 WL 4058727, at *2

- 3 (Tex. App.

— Austin, no pet.)

........... 5

Robinson v. Parker , 353 S.W.3d 753 (Tex. 2011)

................................ ..... 5, 7

Tex. Ass'n of Bus. v. Tex. Air Control Bd., 852 S.W.2d 440 (Tex. 1993)

................................ ................................ ....................... 5, 8

Trinity Settlement Servs., LLC v. Texas State Secs. Bd ., 417 S.W.3d 494 (Tex. App.

— Austin 2013, pet. denied)

................................ ......... 5

TXU Electric v. Public Utilit y Commission , 51 S.W.3d 275 (Tex. 2001)

................................ ................................ ........................... 5

Statutes and Rules

47 C.F.R. §1.1409(e)

................................ ................................ .......... 1, 3, 4, 6

T EX



## . C IV



## . P RAC



## . & R EM



## . C ODE 

## §§ 37.001

– .011

................................ ............. 8

T EX



## . G OV 

## ' T 

## C ODE 

## A NN



## . § 2001.174

................................ ................................ 7

T EX



## . U TIL



## . C ODE 

## A NN



## . § 54.204

................................ ................................ . 3, 7

T EX



## . U TIL



## . C ODE 

## A NN



## . § 54.204(c)

................................ ......................... 2, 4, 9

T EX



## . U TIL



## . C ODE 

## A NN



## . § 54.205

................................ ................................ ..... 3

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APPELLANT CPS ENERGY’S POST SUBMISSION BRIEF iv

# STATEMENT OF FACTS

The Court entertained oral argument in this case on April 22, 2015.

O n April 20, 2015, the Public Utility Commission (“Commission”), through

its attorney, the Attorney General of Texas (“Attorney General”) , filed a

letter in which the Commission asserted that the Court does not have

jurisdiction to decide whether the Commission’s ruling regarding the

applicability of amendments the Federal Communications Commission

(“FC C”) adopted with an effective date of June 8, 2011 was correct. As the

Attorney General’s Letter states , “ [t] hose amendments [to 47 C.F.R.

1.1409(e) ] became effective on June 8, 2011

— several months after the

time period for which the Commission determined the maximum allowable

pole

- attachment rate.” 1



## Thus, the Commission’s Findings of Fact 84

- 87 and Conclusion s of

Law 26 and 27 purported to address rights and facts which have not arisen

and thus the Commission adjudicated matters which are contingent,

u ncertain, or rest in the future, thereby comprising an advisory opinion. As

stated in the Attorney General’s Letter, “we determined the Court does not

1 

### See Letter from Megan Neal, Assistant Attorney General to Honorable Jeffrey D. Kyle, Clerk, Court of Appeals, Third District of Texas (April 20, 2015) (“Attorney General’s Letter”) (addressing CPS Energy’s Appellant’s Point of Error No. 2, Findings of Fact 84

- 87, and Conclusion of Law 27).



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APPELLANT CPS ENERGY’S POST SUBMISSION BRIEF 1

## have jurisdiction to decide one of the i ssues ... [t]his Court and the Texas

Supreme Court have held that statements about the future are advisory 2



## ... .”



# SUMMARY OF ARGUMENT

CPS Energy agrees with the Attorney General that the Commission

issued an advisory opinion regarding the applicability of the June 8, 2011

amendments to the FCC ’s rules

. As CPS Energy explained at oral

arguments, in this proceeding the Commission has consistently over

- reached

in applying its limited authority to CPS Energy, a municipally owned utility

( “ MOU ” ). This issue is yet another example of the Commission exceeding

its jurisdiction in reviewing the dispute s in this case.

CPS Energy respectfully urges the Court to reverse the Commission’s

O rder on Rehearing with regard to Findings of Fact 84

- 87 and Conclusion s

of Law 26 and 27 because those determinations are improper advisory

opinions

.

Should the Court conclude that the Commission’s decision regarding

the applicability of the FCC’s amended rules is not an advisory opinion

,

nonetheless the Court should reverse the Commission’s ruling because the

2 

### The Attorney General’s Letter does not refer to Conclusion of Law 26, but that
conclusion of law suffers from the same flaws as Conclusion of Law 27.



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## Commission’s interpretation of Utilities Code § 54.204(c) would result in an

unconstitutional delegation of power to a federal agency

. 3



# ARGUMENT

Findings of Fact 84

- 87 and Conclusion s of Law 26 and 27 are Improper Advisory Opinions

The Commission limited its review in this proceeding to the billing

years 2005 through 2010 , which also matched th e evidence in the record

.

See Conclusion of Law 24 (“[t]he inputs set out in the findings of fact are

reasonable for use in the Maximum rate formula for test years 2004 through

2009 (billing years 2005 through 2010)”); Conclusion of Law 25 (“[t]he

maximum allowable pole

- attachment rates set forth in the findings of fact for

test years 2004 through 2009 (billing years 2005 through 2010) comply with

PURA §§ 54.204 and 54.205 ”); Findings of Fact 42

- 83A (all limited to

billing years 2005 though 2010).

However, the Commission then went outside the record before it and

unnecessarily concluded that the June 8, 2011 amendments to 47 C.F.R.

1.1409(e) applied prospectively to the parties. See Conclusion s of Law 26

and 27 ( Conclusion of Law 26: “ Changes in 47 U.S.C. § 224(e) are

3 

### See Brief of Appellant, CPS Energy at 16

- 21 (September 5, 2014) (“CPS Brief”) (addressing delegation issue in Point of Error No. 2).



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## incorporated into PURA § 54.204 without legisl ative action;” and

Conclusion of Law 27: “[t]he FCC’s June 8, 2011 amendment to 47 C.F.R.

1.1409(e) applies to CPS Energy under PURA § 54.204(c) ”); Findings of

Fact 84

- 87 (describing the “Methodology Going Forward”). 4 

## Further, the

Commission made the sweeping conclusion that not only did the June 8,

2011 amendment affecting the Telecom Formula apply to the parties, but

that any future changes to FCC regulations that govern pole attachment rates

are incorporated into PURA § 54.204 without action by the Texas

Legislature.

As conceded by the Attorney General ’s Letter , these conclusions were

advisory only. See Attorney General’s Letter at 1 (“we determined the Court

does not have jurisdiction to decide one of the issues ... [t]his Court and the

Texas Supreme Court have held that statements about the future are advisory

... . ”)

“The separation

- of

- powers doctrine prohibits courts from issuing

advisory opinions.” Brinkley v. Te xas Lottery Comm'n , 986 S.W.2d 767,

770 (Tex. App.

— A ustin 1999, no pet.) “The distinctive feature of an

advisory opinion is that it decides an abstract question of law without

4 

### The Commission in its Order on Rehearing made similar statements. See,
Commissi on’s Order on Rehearing at 6 and 22.



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## binding the parties.” Brinkley, 986 S.W.2d at 767 ; citin g Tex. Ass'n of Bus.

v. Tex. Air Control Bd., 852 S.W.2d 440, 444 (Tex. 1993) . “The court wi ll

not declare rights on facts which have not arisen or adjudicate matters which

are contingent, uncertain, or rest in the future.” Brinkley at 768. “An

opinion issued in a case that is not ripe would address only a hypothetical

injury rather than remedying actual or imminent harm.” City of Waco v.

Tex. Nat. Res. Conservation Comm'n , 83 S.W.3d 169, 175 (Tex. App.

—

Austin 2002, pet. denied) . “Ripeness ‘is a threshold issue that implicates

subject matter jurisdiction ... [and] emphasizes the need for a concrete injury

for a justiciable claim to be presented.’” Robinson v. Parker , 353 S.W.3d

753, 755 (Tex. 2011)

.

A decision by a state agency that is advisory or unripe is similarly

invalid. See TXU Electric v. Public Utility Commission , 51 S.W.3d 275, 287

(Tex. 2001) (holding that the Commission’s prospective adjustment for

acquired debt was advisory and thus premature) ; R.R. Comm'n v.

CenterPoint Energy Res. Corp

. , 03

– 13

– 00533

– CV, 2014 WL 4058727 at

*2

- 3 (Tex. App.

— A ustin, no pet.) ; citing Trinity Settlement Servs., LLC v.

Texas State Secs. Bd ., 417 S.W.3d 494, 506 (Tex. App.

— A ustin 2013, pet.

denied) ( “[i] n the administrative

- law context, moreover, avoiding premature

litigation over administrative determinations prevents courts from

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APPELLANT CPS ENERGY’S POST SUBMISSION BRIEF 5

## ‘entangling themselves in abstract disagreements over administrative

policies

... ’” )

.

In this case the parties provided evide nce for the 2005

- 2010 billing

years and the Commission made findings based on that evidence. The

Commission’s analysis of the June 8, 2011 amendments to 47 C.F.R.

1.1409(e) , which was incorporated into the case as a result of the Conclusion

of Law 26, had no bearing on the evidence before it. As the Attorney

General’s L etter concedes

, “ t hose amendments [to 47 C.F.R. 1.1409(e)]

became effective on June 8, 2011

— several months after the time period for

which the Commissi on determined the maximum allowable pole

- attachment

rate.” The Commission’s Findings of Fact 84

- 87 and Conclusion s of Law

26 and 27 , therefore, “declare[d] rights on facts which have not arisen or

adjudicate[d] matters which are contingent, uncertain, or rest in the future,”

in violation of the Court’s ruling in Brinkley and similar cases

. Brinkley

,

986 S.W.2d at 768.

CPS Energy respectfully ur ges the Court to adopt the Commission’s

concession that Findings of Fact 84

- 87 and Conclusion s of Law 26 and 27

were advisory opinions. As CPS Energy discusses above, the Commission

made determinations of facts and law unripe for decision . The effect of such

finding s is to remove the Commission’s subject matter jurisdiction to issue

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## those findings and conclusions. See Robinson

, 353 S.W.3d at 755

( “[r] ipeness ‘is a threshold issue that implicates subject matter

jurisdiction’...”)

. CPS Energy thus respectfully urges the Court to find that

the Commission’s determinations have no legal effect and to reverse the

Commission’s Order on Rehearing regarding Findings of Fact 84

- 87 and

Conclusion s of Law 26 and 27. 5



## The Uniform Declaratory Judgment Act does not Apply to this Case

At the oral argument, AT&T argued that the Commission’s findings

were not advisory opinions because the case was brought as a d eclaratory

j udgment action

. AT&T’s argument lacks merit for two reasons.

First, CPS Energy did not file the case under the Uniform Declaratory

Judgment Act (“ UDJA ”) . CPS Energy instead filed the case as a petition for

enforc ement under Utilities Code § 54.204

. Indeed, the style of the case is

“ Petition of CPS Energy for Enforcement Against AT&T Texas and Time

Warner Cable Regarding Pole Attachments ” and CPS Energy’s petition was

5 

### It is appropriate for the Court to reverse the Commission’s decision in this case if the decision prejudices substantial rights of CPS Energy. T EX



### . G OV 

### ' T 

### C ODE 

### A NN



### . § 2001.174 (West 2000) ; Central Power & Light Co. v. Public Util. Comm'n , 36 S.W.3d 547, 561

- 562 (Tex.App.

— Austin 2000, pet. denied) . In this case, Time Warner Cable Texas LLC (“Time Warner”) is seeking damages against CPS Energy in a related case in Bexar County District Court. If the Commission’s advisory opinion about the FCC’s June 8, 2011 amendments stands untouched, Time Warner will undoubtedly use that opinion to seek damages against CPS Energy in the Bexar County litigation. Therefore, CPS Energy’ s substantial rights will be prejudiced and it is appropriate to reverse the Commission’s decision.



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APPELLANT CPS ENERGY’S POST SUBMISSION BRIEF 7

## titled “Petition and Request for Enforce ment of CPS Energy.” Order on

Rehearing at 1. Therefore, a ny case law interpreting the UDJA is

i napplicable to this case. See, e.g., City of Waco, 83 S.W.3d at 177

(analyzing ripeness requirements for UDJA actions).

Second, even if considered to be a declaratory judgment action, Texas

courts have consistently held that a declaratory judgment action does not

expand a tribunal’s subject matter jurisdiction. “[W]e have interpreted the

Uniform Declaratory Judgments Act, T EX



## . C IV



## . P RAC



## . & R EM



## . C ODE 

## §§

37.001

– .011 , to be merely a procedural device for deciding cases already

within a court’s jurisdiction rather than a legislative enlargement of a court’s

power, permitting the rendition of advisory opinions.” Tex. Ass'n of Bus.,

852 S.W.2d at 444 ; see also Firemen's Ins. Co. v. Burch, 442 S.W.2d 331,

333 (Tex. 1969) (“the Legislature could not and has not by the passage of

the Uniform Declaratory Judgments Act, empowered the district courts to

render advisory opinions”)

. Consequently, even had the parties filed a

declaratory judgment action, which they did not, the Commission would

have lacked subject matter jurisdiction to issue Findings of Fact 84

- 87 and

Conclusion s of Law 26 and 27 since those determinations were advisory and

unripe.

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APPELLANT CPS ENERGY’S POST SUBMISSION BRIEF 8

## Findings of Fact 84

- 87 and Conclusion s of Law 26 and 27 Result in an Unconstitutional Delegation of Power

If the Court concludes that the Commission’s decision regarding the

applicability of the FCC’s June 8 2011 amendments to its rules were not an

advisory opinion, then a s CPS Energy explain ed in its Point of Error No. 2,

the Commission’s interpretation of Utilities Code § 54.204(c) results in an

unconstitutional delegation of power to a federal agency

. See CPS Brief at

16

- 21. C PS Energy respectfull y refers the Court to its briefs for its

arguments on that issue. Id

.

Conclusion

The Commission exceeded its jurisdiction on several occasions and

Findings of Fact 84

- 87 and Conclusion s of Law 26 and 27 are examples of

this overstepping of jurisdictional authority. See CPS Brief at 16

- 47 (Points

of Error Nos. 2

- 5). As the Attorney General recognized, the Commission

issued an advisory opinion about the applicability of the June 8, 2011

amendments to the FCC’s rules

. The record only addressed billing years

2005

- 2010 and thus t he dispute upon which the Commission issued its

opinion was unripe. The Commission’s opinion was also an

unconstitutional delegation of power.

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APPELLANT CPS ENERGY’S POST SUBMISSION BRIEF 9

## For all of these reasons, CPS Energy respectfully urges the Court to

find that Findings of Fact 84

- 87 and Conclusion s of Law 26 and 27 have no

legal effect and remand the case to the Commission with instructions to

issue an order consistent with the Court’s opinion

.

Respectfully submitted,

CPS Energy

Gabriel Garcia ggarcia@cpsenergy.com Carolyn She l lman cshellman@cpsenergy.com

CPS Energy
145 Navarro
P.O. Box 1771 San Antonio, Texas 78296 (210) 353

- 5689 (Voice) (210) 353

- 6832 (Facsimile) HERRERA & BOYLE, PLLC

Alfred R. Herrera
State Bar No. 09529600 aherrera@herreraboylelaw.com

816 Congress Avenue, Suite 1250 Austin, Texas 78701 (512) 474

- 1492 (Voice) (512) 474

- 2507 (Facsimile)

By: /s/ Alfred R. Herrera

Alfred R. Herrera

ATTORNEYS FOR CPS ENERGY

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# CERTIFICATE OF SERVI CE

I hereby certify that on this the 8 th 

## of May , 201 5 , a true and correct

copy of Appellant CPS Energy’s Post Submission Brief was served upon
all parties listed below by certified mail, return receipt requested, or hand

delivered.

By: /s/ Alfred R. Herrera

Alfred R. Herrera

Counsel for Public Utility Commission
of Texas:

Douglas Fraser Megan Neal Office of the Attorney General

P.O. Box 1 2548, Capitol Station Austin, Texas 78711

- 02548 Phone: (512) 463

- 2012 Fax: (512) 457

- 4610 douglas.fraser@texasattorneygeneral.gov megan.neal@texasattorneygeneral.gov Counsel for CPS Energy:

Alfred R. Herrera HERRERA & BOYLE, PLLC 816 Congress Avenue, Suite 1250 Austin, TX 78701 Phone: (512) 474

- 1492 Fax: (512) 474

- 2507 aherrera@herreraboylelaw.com

Counsel for AT&T Texas:

Paul A. Drummond
Natalie L. Hall AT&T Legal Department 1010 N. St. Mary’s, 14 th 

## Floor San Antonio, Texas 78215 Phone: (210) 351

- 4830 Fax: ( 210) 886

- 2127 paul.drummond@att.com
natalie.hall@att.com Counsel for CPS Energy:

Carolyn She l l man Gabriel Garcia CPS Energy
145 Navarro
P.O. Box 1771 San Antonio, TX 78296 Phone: (210) 353

- 5689 Fax: (210) 353

- 6832 cshellman@cpsenergy.com ggarcia @cpsenergy.com

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# CERTIFICATE OF COMPL IANCE

The Word document properties feature states there are 1,961 words in this

document.

By: /s/Alfred R. Herrera

Alfred R. Herrera Counsel for AT&T Texas:

Michael T. Sullivan Mayer Brown LLP
71 S. Wacker Drive Chicago, IL 60606 Phone: (312) 782

- 0600 Fax: (312) 706

- 8689 msullivan@mayerbrown.com Counsel for AT&T Texas:

J. David Tate
Katherine C. Swaller
Thomas Ballo AT&T Legal Department 816 Congress Ave nue, Suite 1100 Austin, Texas 78701 Phone: (512) 457

- 2304 Fax: (512) 870

- 3420 jon.david.tate@att.com
katherine.swaller@att.com
thomas.ballo@att.com

Counsel for Time Warner Cable Texas
LLC:

Valerie P. Kirk
Melissa Lorber
Enoch Kever PLLC 600 Congress Avenue, Suite 2800 Austin, Texas 78701 Phone: (512) 615

- 1200 Fax: (512) 615

- 1198
vkirk@enochkever.com
mlorber@enochkever.com Counsel for Time Warner Cable
Texas LLC:

J.D. Thomas J. Aaron George Sheppard Mullin Richter & Hampton LLP 1300 I Street, N.W.
11 th 

## Floor East Washington DC 20005 Phone: (202) 218

- 0000 Fax: (202) w 218

- 0020 dthomas@sheppardmullin.com

ageorge @sheppardmullin.com

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# APPENDIX I:

Referenced Case Law and Statutes

(

Excludes Items Provided with CPS Energy’s Previous Briefs )

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APPENDIX I:

Referenced Case Law and Statutes

( Excludes Items Provided with CPS Energy’s Previous Briefs)

Cases

1. Brinkley v. Texas Lottery Comm'n , 986 S.W.2d 767 (Tex. App.

— Austin 1999, no pet.)

2. City of Waco v. Tex. Nat. Res. Conservation Comm'n , 83 S.W.3d 169
( Tex. App.

— Austin 2002, pet. denied)

3. Firemen's Ins. Co. v. Burch, 442 S.W.2d 331 (Tex. 1969)

4. Railroad Comm'n v. CenterPoint Energy Res. Corp. , 03

– 13

– 00533

– CV, 2014 WL 4058727, at *2

- 3 (Tex. App.

— Austin, no pet.)

5. Robinson v. Parker , 353 S.W.3d 753 (Tex. 2011)

6. Tex. Ass'n of Bus. v. Tex. Air Control Bd., 852 S.W.2d 44 0
( Tex. 1993)

7. Trinity Settlement Servs., LLC v. Texas State Secs. Bd ., 417 S.W.3d 494 (Tex. App.

— Austin 2013, pet. denied)

8. TXU Electric v. Public Utili ty Commission , 51 S.W.3d 275
(Tex. 2001)

Statutes and Rules

9. 47 C.F.R. §1.1409(e)

10. T EX



## . C IV



## . P RAC



## . & R EM



## . C ODE 

## §§ 37.001

– .011

11. TEX. UTIL. CODE ANN. § 54.205Brinkley v. Texas Lottery Com’n, 986 S.W.2d 764 (1999)

986 S.W.2d 764
Court o f Appeals of Texas,

Austin.

Shannon BRINKLEY, d/b/a Krane

– Ko Vending, Appellant,

v. TEXAS LOTTERY COMMISSION , Appellee.

No. 03

– 97

– 00252

– CV | Feb. 4, 1999.

Owner of electronic machines similar to slot machines filed action seeking, in part, declaratory judgment that his machines were not gambling devices. The District Court, Travis County, 250th Judicial District, John K. Dietz , J.P.,
dismiss ed his causes of action for want of jurisdiction. Owner appealed. The Court of Appeals, John Powers , J. (Retired), held that: (1) cause of action seeking declaratory judgment that machines were not gambling devices sought improper advisory opinion; (2) trial court lacked jurisdiction to grant requested injunctive relief in absence of allegations of probable injury; (3) Commission’s advisory letters were not “ rules ” within meaning of provision of Administrative Procedure Act (APA) authorizin g declaratory judgments to determine validity of rules; and (4) Commission was not subject to
suit under § 1983 or federal civil rights conspiracy statute.

Affirmed.

Attorneys and Law Firms

*766 Ira E. Tobolowsky , Tobolowsky & Burk, P.C., Dallas, for Appellant.

John Cornyn , Atty. Gen., Matthew L. Rienstra , Asst. Atty. Gen., Admistrative Law Division, Austin, for Appell ee. Before Chief Justice ABOUSSIE , Justices B.A. SMITH
and POWERS. *

* Before John Powers , Senior Justice (retired), Third Court of Appeals, sitting by assignment. See Tex. Gov’t Code Ann. § 74.003(b) (West 1998).

Opinion

JOHN POWERS , Justice (Retired).

Shannon Brinkley sued the Texas Lottery Commission to obtain a declaratory judgment that certain machines,
denominated “ eight

- liners, ” are not “ gambling devices ” as defined by the Texas Penal Code. See Tex. Penal Code Ann. § 47.01(B)(4) (West Supp.1998). He applied for an injunction against enforcement of any criminal or administrative penalties for operating “ eight

- liners, ” and
in a civil

- rights action prayed for compensatory damages.
The trial court dismissed his causes of action for want of jurisdiction. Brinkley appeals. We will affirm the judgment.

THE CONTROVERSY

The Bingo Enabling Act, administered and enforced by the Texas Lottery Commission, provides as follows:

A game of chance other than bingo ... may not be conducted or allowed during an occasion when bingo is played.... This subsection does not prohibit the exhibition and play of
an amusement machine that is not a gambling device as defined by Section 47.01, Penal Code

.

Tex.Rev.Civ. Stat. Ann. art. 179d, § 11(k) (West Supp.1998)

. Section 47.01 of the Penal C ode defines

“ gambling device. ” 1

1 “ Gambling device ” means any electronic, electromechanical, or mechanical contrivance not excluded under Paragraph (B) that for a consideration affords the player an opportunity to obtain anything of value, the award of which is det ermined solely or partially by chance, even though accompanied by some skill, whether or not the prize is automatically paid by
the contrivance. The term:

* * * (B) does not include any electronic, electromechanical, or mechanical contrivance designed, mad e, and adapted solely for bona fide amusement purposes if the contrivance rewards the player exclusively with noncash merchandise prizes, toys, or novelties, or a representation of value redeemable for those items, that have a wholesale value available
fro m a single play of the game or device of not more than 10 times the amount charged to play the game or device once or $5, whichever is

less. Texas Penal Code Ann. § 47.01(4)(B) (West Supp.1998).

© 2015 Thomson Reuters. No claim to original U.S. Government Works. 1Brinkley v. Texas Lottery Com’n, 986 S.W.2d 764 (1999)

The Commission licenses and regulates some 2,500 bingo

- parlors. Many licensees allow the operation of

“ eight

- liners ” in their parlors. Eight

- liners are electronic machines (similar to “ slot machines ” ) that dispense gift certificates redeemable for prizes. The machines do not all operate in the same manner; their operation and payout can be configured in a variety of ways.

*767 The Commission received numerous complaints and inquiries from licensees who were uncertain ab out whether the particular machines in their parlors were set up to operate legally. In response, the Commission sent to its licensees letters setting forth criteria by which the licensees might ascertain the legal status of machines in their parlors. The letters included a warning that illegally operated machines exposed licensees to administrative and criminal penalties. 2 The Commi ssion noted in the letters that application of the stated criteria would not necessarily determine the legality of the machines and

“ the agency cannot guarantee that the use of the eight

- liners is necessarily legal. ” The letters concluded:

“ we hope this he lps answer questions you may have in regard to this issue. ”

2 The Commission may impose administrative penalties
for violations of the Bin go Enabling Act.

Law

- enforcement authorities enforce the Texas Penal
Code.

Brinkley does not hold a Commission license to operate a bingo parlor. He owns several eight

- liners that he formerly operated in a space he leases within a licensed bingo parlor. When Brinkley’s lessor received the Commission’s letters, he refused to allow Brinkley to continue the operation of his eight

- liners in the bingo parlor.

Brinkley pleaded against the Commission the following
causes of action:

(1) An action under the Uniform Declaratory Judgments Act for a judicial determination that eight

- liners are not gambling devices under section 47.01(4)(B) of the Texas
Penal Code , and that the Commission’s interpretat ion of
section 47.01 is unconstitutional;

(2) an action for declaratory judgment under section
2001.038 of the Texas Government Code that the
Commission’s letters constitute “ rules, ” as defined by section 2001.003(6) of the Administrative Procedure Act,
and that the “ rules ” are invalid because they were not formulated or adopted in compliance with the rulemaking provisions of Texas Government Code sections

2001.021

– .037; 3

3 See Tex. Gov’t Code Ann. §§ 2001.021

– .037 (West 1998).

(3) an application for injunction restraining the
Commission and “ all others ” from interfering with the operation of Brinkley’s eight

- liners in bingo parlors, whether by raids, hara ssment, criminal prosecution, forfeiture and seizure of Brinkley’s eight

- liners, or any other way; and

(4) actions for injunctive relief and compensatory damages, under 42 United States Code sections 1983 and
1985 , f or violation of Brinkley’s civil rights under color
of state law. 4

4 See 42 U.S.C. §§ 1983

, 1985 (1994)

.

The Commission filed pleas to the jurisdiction, contending the trial court lacked subject

- matter jurisdiction because (1) the actions were barred by the doctrine of sovereign immunity; (2) Brinkley lacked standing to asse rt the actions alleged; (3) the trial court lacked jurisdiction to determine legal relationships under a penal statute; and (4) there existed no justiciable controversy. The trial court denied the plea of sovereign immunity but sustained the pleas on the o ther grounds claimed and dismissed the actions. Brinkley contends the trial court possessed jurisdiction on the grounds discussed
below.

UNIFORM DECLARATORY JUDGMENTS ACT

[1] [2] [3] [4] The separation

- of

- powers doctrine prohibits courts from issuing advisory opinions. Texas Ass ’n of Bus. v. Texas Air Control Bd., 852 S.W.2d 440, 444 (Tex.1993) ; Firemen’s Ins. Co. v. Burch, 442 S.W.2d 331, 333 (Tex.1969) ; Morrow v. Corbin, 12 2 Tex. 553, 62 S.W.2d 641, 647 (1933) . The distinctive feature of an advisory opinion is that it decides an abstract question of law without binding the parties. Alabama State Fed’n of Labor v. McAdory, 325 U.S. 450, 461, 65 S.Ct. 1384, 89 L.Ed. 1725 (1945) ; Texas Ass’n of Bus., 852 S.W.2d at 444; Firemen’s Ins. Co., 442 S.W.2d at 333; California Prods. Inc. v. Puretex Lemon Juice, Inc., 160 Tex. 586, 334 S.W.2d 780, 783 (1960) . An opinion is advisory

© 2015 Thomson Reuters. No claim to original U.S. Government Works. 2Brinkley v. Texas Lottery Com’n, 986 S.W.2d 764 (1999)

when the judgment sought would not constitute specific relief to a litigant or affect legal rela tions. Reuter v. *768
Cordes

– Hendreks Coiffures, 422 S.W.2d 193, 196 (Tex.Civ.App.

— Houston [14th Dist.] 1967, no writ)

.

“ The court will not declare rights on facts whi ch have not arisen or adjudicate matters which are contingent, uncertain, or rest in the future. ” 26 C.J.S. Declaratory Judgments, § 28 (1956)

.

[5] [6] Brinkley alleged that he sustained “ irreparable injury to vested property rights with no adequate remedy at law ” because his lessor, “ as a result ” of the Commis sion’s letters, demanded that Brinkley remove his machines. Elsewhere in his petition, Brinkley’s allegations are susceptible of a construction that the letters prevent his operating his machines in other bingo parlors. We believe Brinkley’s cause of actio n under the UDJA requires an advisory opinion. Brinkley and the Commission are the only parties to the lawsuit and Brinkley is not a licensee subject to the Commission’s regulation. 5 Brinkley necessarily speculates that a declaratory judgment, holding that eight

- liners are not gambling devices, may induce his lessor or other bingo

- parlor licensees to allow him to operate his machines , however configured, in their parlors. This is a contingency, an uncertainty, a hypothesis upon which a court may not decide the legal issues raised in Brinkley’s petition. See Coalson v. City Council of Victoria, 610 S.W.2d 744, 747 (Tex.1980) (suit to declare invalid city charter

- amendment initiative requires advisory opinion because voters might disapprove proposed amendment ); Central Sur. & Ins. Corp. v. Anderson, 445 S.W.2d 514, 515 (Tex.1969) (suit for declaratory judgment that insurer liable to pay judgment, in advance of judgment against tort defendant, requires adviso ry opinion); see generally Texas Ass’n of Bus., 852 S.W.2d at 444. 6

5 The Commission regulates amusement machines
pursuant to article 179d of the Texas Revised Civil
Statutes (Bingo Enabling Act) which is concerned only with those amusement machines located in bingo halls.

See Tex.Rev.Civ. Stat. art. 179d (West 1998) . Outside of bingo halls, law enforcement personnel are charged
with the enforcement of Texas Penal Code section
47.01 which prohibits the use of “ gambling devices. ” Tex. Penal Code § 47.01 (West 1994 & Supp.1998).

6 The Uniform Declaratory Judgments Act, found in the Texas Civil Practice & Remedies Code, is a procedural device for deciding cases already within a court’s jurisdiction; the statute does not enla rge a court’s jurisdiction so as to authorize the rendition of advisory opinions. See Tex. Civ. Prac. & Rem.Code Ann. §§
37.001

– .011 (West 1997); Texas Ass’n of Bus. v. Texas Air Control Bd. , 852 S.W.2d 440, 444 (Tex.1993)

.

INJUNCTIVE RELIEF

[7] [8] The trial court also lacked jurisdiction to grant the injunctive relief requested. 7 Injunctions may not issue unless it is shown that the respondent will engage in or is engaging in the activity to be enjoined. See State v. Morales, 869 S.W.2d 941, 946

– 47 (Tex.1994) . Brinkley seeks to enjoin the Commission and “ all others ” from interfering with the operation of his eight

- liners in bingo parlors in any way, including the prohibition of raids, harassment, criminal prosecution, and forfeiture a nd seizure of his machines. Brinkley alleged only that the Commission sent the advisory letters to about 2,500 licensees. He has not alleged that the Commission threatens to impose upon him (he is not a licensee) administrative penalties nor that law enfor cement authorities (not parties here) threaten to prosecute him under the criminal law. He has not alleged that the Commission, unless restrained, will enforce against him any sanction within its power to enforce. We decline to
hold as a matter of law that the Commission’s sending of the advisory letters to a large number of its licensees constituted a showing of “ probable injury ” to Brinkley.

See id. at 946

– 47; Transport Co. v. Robertson Transports,

In c., 152 Tex. 551, 261 S.W.2d 549, 552 (1953) (requiring showing of “ probable injury ” if respondent not restrained). Absent allegations of fact showing a probable injury, a court is without jurisdiction to grant the injunctive relief requested. See Morales, 869 S.W.2d at 942, 946

– 47; see also *769 Texas Employment Comm’n
v. Martinez, 545 S.W.2d 876, 877

– 78 (Tex.Civ.App.

— El Paso 1976, no writ)

.

7 Brinkley requested injunctive relief pursuant to section
65.011 of the Texas Civil Practice & Remedies Code
and section 16.29 of the Texas Business & Commerce
Code (Injury to Business Reputation or Trade Name or Mark); Tex. Civ. Prac. & Rem.Code Ann. § 65.011 (West 1997) ; Tex. Bus. & Com.Code Ann. § 16.29 (West Supp.1998).

ADMINISTRATIVE PROCEDURE
ACT

— DECLARATORY JUDGMENT

Section 2001.038 of the Administrative Procedure Act

© 2015 Thomson Reuters. No claim to original U.S. Government Works. 3Brinkley v. Texas Lottery Com’n, 986 S.W.2d 764 (1999)

(APA) creates a cause of action for declaratory judgment to determine the validity or applicability of an agency rule
when it “ is al leged that the rule or its threatened application interferes with or impairs, or threatens to interfere with or impair, a legal right or privilege of the plaintiff. ” Tex. Gov’t Code Ann. § 2001.038 (West 1998)

. For purposes of section 2001.038 and all other sections in Chapter 2001 of the Texas Government Code, the word

“ rule ”

(A) means a state agency statement of general applicability that:

(i) implements, interprets, or prescribes law or policy; or

(ii) describes the procedure or practice requirements of a state agency;

(B) includes the amendment or repeal of a prior rule;
and

(C) does not include a statement regarding only the internal management or organization of a state agency and not affecting p rivate rights or procedures.

Tex. Gov’t Code Ann. § 2001.003(6) (West 1998) (emphasis added).

[9] Brinkley contends the trial court had jurisdiction of his cause of action for declaratory judgment, under section

2001.038 of the APA, because the Commission letters
amounted to a “ rule ” as defined in section 2001.003( 6)

. We disagree.

[10] “ Not every statement by an administrative agency is a rule for which the APA prescribes procedures for adoption and for judicial review. ” Texas Educ. Agency v. Leeper, 893 S.W.2d 432, 443 (Tex.1994) . This observation refers to the fact that administrative agencies routinely issue letters, guidelines, and reports, and occasionally file bri efs in court proceedings, any of which might contain statements that intrinsically implement, interpret, or prescribe law, policy, or procedure or practice requirements. Are all such statements therefore

“ rules ” within the meaning of APA section 2001.003(6)
and 2001.038 ? They are not for several reasons.

It does not appear that the legislature has delegated to the Commission a power to bind others by ukase

— a naked proclamation contained, for ex ample, in a letter, a set of guidelines, or a report, or by a statement in a brief filed in a court proceeding. It appears instead that the Commission may bind others generally only by a rule promulgated through the notice

- and

- comment procedures
of APA sec tions 2001.022

– .037, or bind particular litigants by the Commission’s order adjudicating a contested case conducted under the procedures set forth in
APA sections 2001.051

– .147. The same is true in general of most constitutive statutes and enabling acts de legating power to administrative agencies.

The legislature intends that administrative agencies exercise effectively the powers delegated to them. See Sexton v. Mount Olivet Cemetery Ass’n, 720 S.W.2d 129

, 137 (Tex.App.

— Austin 1986, writ ref’d n.r.e.) . Agencies would be reduced to impotence, however, if bound to express their views as to “ law, ” “ policy, ” and procedural

“ requirements ” through contested

- case decisions or formal rules exclusively; and they could not under such a theory exercise powers explicitly delegated to them by the legislature. How, under such a theory, could an agency practically express its views to an informal conference or advisory committee, or state its reasons for denying a peti tion to adopt a rule, or file a brief in a court or agency proceeding? See Tex. Gov’t Code Ann. §§ 2001.021

, .031, .058 (West 1998).

The foregoing are only examples derived from the APA itself. If every expression by the agency as to “ law, ”

“ policy, ” and procedural “ requirements ” requires the promulgation of a formal rule, the agency could no longer
exercise its “ informed discretion ” to choose adjudication as a means of making law and policy, rather than rulemaking, a choice we have r epeatedly said an agency has when it possesses both adjudicatory and rulemaking

powers. See, e.g., Madden v. Texas Bd. of Chiropractic Exmr’s, 663 S.W.2d 622, 626 (Tex.App.

— Austin 1984, writ ref’d n.r.e.) ; *770 State Bd. of Ins. v. Deffebach, 631 S.W.2d 794, 799 (Tex.App.

— Austin 1982, writ ref’d n.r.e.) . If the agencies were so restricted, they would be deprived, as a practical matter, of the power to adjudica te; an agency could make valid “ law ” or “ policy ” only through the straight

- jacket of rulemaking, even though the agency might be quite unable to do so for any number of
reasons as noted in El Paso v. Public Util. Comm’n, 883 S.W.2d 179, 188

– 89 (Tex.1994)

. 8

8 The legislature may, by statute, require an agency to make formal rules with regard to particular matters. See Railroad Comm’n v. Shell Oil Co., 146 Tex. 286, 206 S.W.2d 235, 241 (1947) . The agency would be bound, of course, to enact rules in compliance with the legislative mandate. It may also be that a constitutional provision requires, in particular circumstances, that the agency promulgate a formal rule before attempting to bind private persons by the agency’s view of “ law, ”

“ policy, ” or procedural “ requirements. ” See, e.g., Madden v. Texas Bd. of Chiropractic Exmr’s, 663

© 2015 Thomson Reuters. No claim to original U.S. Government Works. 4Brinkley v. Texas Lottery Com’n, 986 S.W.2d 764 (1999)

S.W.2d 622, 626

– 27 ( Tex.App.

— Austin 1984, writ ref’d n.r.e.) . Such matters are not involved in the
present controversy.

The very text of the APA rejects the theory that every agency pronouncement regarding “ law, ” “ policy, ” and procedural “ requirements ” requires the prom ulgation of a formal rule. That theory would destroy, for example, the
distinction between “ rules ” and “ policies ” found in section 2001.058(b), (c), and (e); the word “ policies ” is rendered meaningless because under that theory

“ policies ” could only exist in the form of “ rules. ”

We need not belabor the point. The definition in section 2001.003(6) is sufficiently flexible to allow agencies to perform their functions without unnecessary procedural obstacles; the definition expressly excludes from the
definition of a “ rule ” any agency statements regarding only the internal management or organization of an agency that do not affect private rights or procedures. See Tex. Gov’t Code Ann. § 2001.003(6)(C) (West 1998). This statutory exclusion encompasses any agency statement regarding “ law, ” “ policy, ” or procedural

“ requirements ” made outside the rulemaking and
contested

- case context; such statements have no legal effect on private persons absent a statute that so provides or some attempt by the agency to enforce its statement against a private person, as in Madde n where the agency attempted to enforce, in the course of adjudicating a contested case, its policy of what constituted a “ bona fide reputable chiropractic ” school. See Madden, 663 S.W.2d

at 626

– 27. A t that point, an affected person may challenge, if he wishes, the validity or applicability of the agency statement on whatever grounds may be applicable. Until then, the agency’s pronouncements regarding “ law, ”

“ policy, ” and procedural “ requirements ” rema in merely informal views, effective only upon and within the agency’s internal management and organization. 9 See Leeper, 893 S.W.2d at 443 (state board of education resolution stating guidelines for school districts pending statutory revision); United Parcel Serv., Inc. v. Oregon Transp. Comm’n, 27 Or.App. 147, 555 P.2d 778, 780 (1976) (commission statement consenting to city’s designation of truck route); Reynolds Sch. Dist. v. Oregon Sch. Employees, 58 Or.App. 60 9, 650 P.2d 119, 123 (1982) (agency statement made in adjudication of previous contested case); United States v. Fitch Oil Co., 676 F.2d 673, 678 (Temp.Emer.Ct.App.U.S.1982) (statement of Secretary of Energy); Durnin v. Allentown Fed. Sav. and Loan Ass’n, 218 F.Supp. 716, 721 (E.D.Pa.1963) (letter from supervisory agent of Federal Home Loan Bank Board); 1 Davis and Pierce,
Administrative *771 Law Treatise § 3.5 at 120 (3d ed.1994). 10

9 The letters sent by the Commission in this instance were, on their face, simply advisory guidelines; they did not purport to express a final opinion on the legality of eight

- liners of any particular kind. We have previously noted the valuable role such adv isory opinions serve in administration. See Texas Comm’n of Licensing and Regulation v. Model Search America, Inc., 953 S.W.2d 289 (Tex.App.

— Austin 1997, no writ) . As we stated in that opinion, [T]o permit suits for declaratory judgments up on mere informal, advisory, administrative opinions might well discourage the practice of giving such opinions, with a net loss of far greater proportions than any possible gain.
Id. at 293 quoting, He lco Prods. Co. v. McNutt, 137 F.2d 681, 684 (D.C.Cir.1943) . Considering the number of bingo

- parlor licensees and the variety of ways in which eight

- liners can be configured, the practical value of the letters is obvious. Nothing in the letters purports to foreclose an individual licensee from seeking, if he wishes, a formal opinion from the Commission regarding particular eight

- liners. While private parties may voluntarily comply with such guidelines, they are not legally bound to do so.

10 The first Commission letter stated:
TO ALL BINGO LICENSEES: The Texas Lottery Commission has received complaints regarding the use of gambling devices at locations where bingo is being conducted. The specific complaints concern the operation of devices popularly known as “ Eight Liners. ” The Texas Lottery Commission considers these devices to be gambling devices as defined by Section 47.01(4) of the Texas Penal Code

, as a result of the method of operation and payoff of
these devices. Please be aware that Section (11(k)) of the Bi ngo Enabling Act, Texas Revised Civil Statutes Article
179d , provides the following: “ A game of chance other than bingo may not be conducted or allowed during an occasion when bingo is played. This subsection does not prohibit the exhibi tion and play of an amusement machine that is not a gambling device as defined by Section 47.01,
Penal Code

. ” Therefore, effective September 1, 1996, the
Commission will refer any incident of use by a
licensee of the aforementioned device (s) in an illegal manner which is detected after September 1, 1996 to the appropriate law enforcement agency for criminal prosecution and will initiate an appropriate administrative disciplinary action.
This notice is intended to make licensees aware of
th e agency’s position and to afford an opportunity to licensees for voluntary compliance.

© 2015 Thomson Reuters. No claim to original U.S. Government Works. 5City of Waco v. Texas Natural Resource Conservation Com’n, 83 S.W.3d 169 (2002)

83 S.W.3d 169
Court of Appeals of Texas,
Austin.

CITY OF WACO, Appellant,

v. TEXAS NATURAL RESOURCE CONSERVATION COMMISSION; and Jeffrey A. Saitas, as Executive Director, Appellees.

No. 03

– 01

– 00217

– CV. | May 9, 2002. | As Modified on Overruling of RehearingJune 21, 2002.

City and dairy producers’ association filed action seeking declaratory judgment that Texas Natural Resources Conservation Commission (TNRCC) order regulating future permits for confined animal feeding operations (CAFOs) was invalid, TNRCC withdrew order an d filed motion to dismiss action as moot and not ripe, and city amended petition to seek declaratory relief that TNRCC’s interim policy of continuing to issue any permits violated state regulation. The 353rd Judicial District Court, Travis County, Paul Davis , J., dismissed actions. City appealed. The Court of Appeals, Bea Ann Smith , J., held that: (1) dispute had to be evaluated in terms of ripeness, not mootness; (2) question of whether federal regulation, as adopted by state law, operated to prohibit TNRCC from approving any new CAFO permits until TNR CC adopted necessary pollution

- reduction measures presented purely legal inquiry, which would not benefit from development of additional facts in connection with specific permit application; and (3) facts underlying dispute were sufficiently developed to m ake dispute ripe for review; and on rehearing, Smith, J., held that: (4) sovereign immunity did not bar city’s suit; and (5) city was not seeking advisory opinion, and thus suit was not hypothetical and presented real controversy that would be resolved by declaratory relief sought.

Reversed and remanded.

Attorneys and Law Firms

*172 Jackson B. Battle , Brown McCarroll L.L.P., Austin, for appellant.

An thony C. Grigsby, Linda B. Secord , Assistant Attorneys General, Natural Resources Division, Austin, for appellees.

Before Chief Justice ABOUSSIE , Justices B.A. SMITH and PURYEAR

.

BEA ANN SMITH , Justice.

This appeal con cerns whether a dispute about the Texas Natural Resource Conservation Commission’s (the TNRCC’s) permit

- issuing process is ripe for judicial review by the district court. The Bosque River, a tributary of the Brazos River, is located northwest of the city o f Waco. Segments 1226 and 1255 of the North Bosque River have been listed as having impaired water quality due to high levels of nutrients. See 30 Tex. Admin. Code §§ 307.1

– .10 (2001) (Tex. Natural Res. Conservati on Comm’n, Tex. Surface Water Quality Standards). Near its point of confluence with the Brazos River, the Bosque River forms Lake Waco, which provides the sole source of drinking water for approximately 150,000 people in and around Waco; the lake is also u sed extensively for recreational activities. The water quality of Lake Waco,
which is a “ sink ” for any dissolved pollutants in the Bosque River, has been affected. Numerous dairy operations are located northwest of Waco in Erath County in the Bosque River watershed. The dairies must seek confined animal feeding operation (CAFO) permits from the TNRCC because the agricultural waste from their operations, which becomes dissolved in runoff or is otherwise discharged, ultimately discharges into the river.

[1] This dispute arose when the TNRCC promulgated an order in February 2000 regulating future permits for CAFOs. Both the City of Waco (the City) and the Texas
Associatio n of Dairymen (the Dairymen) filed actions for declaratory judgments attacking the order. The TNRCC responded by withdrawing the order and moving to dismiss both actions as moot and not ripe. The City amended its petition to seek declaratory relief that th e TNRCC’s interim policy of continuing to issue any permits violates state regulations. The district court dismissed the actions. Both the Dairymen and the City appealed the dismissal of their suits for declaratory relief. However, following oral argument, the Dairymen voluntarily dismissed their appeal. 1 The only remaining issue before us is the ripeness of the City’ s suit for declaratory relief. 2

1 The TNRCC filed a motion to dismiss the Dairymen’s appeal on the ground that legislative action had mooted the association’s appeal. Because the Dairymen voluntarily dismissed their appeal, we overrule the
TNRCC’s motion.

© 2015 Thomson Reuters. No claim to original U.S. Government Works. 1City of Waco v. Texas Natural Resource Conservation Com’n, 83 S.W.3d 169 (2002)

2 The TNRCC’s motion to dismiss the Dairymen’s and the City’s claims asserted mootness and ripeness grounds. After a hearing, the trial cour t granted the
motion. The order states that “ [a]fter considering the motion, the responses, and the evidence filed in support of the motion and responses, the court: GRANTS the motion and DISMISSES [the consolidated causes]. ” In its brief, the TNRCC assert s that the City’s claims is

moot and not ripe. While the City’s original claims may have been rendered moot by the TNRCC’s action revoking its order, it amended its petition to state a different claim based on the TNRCC’s policy. We
conclude therefore that the issue should be analyzed in terms of ripeness.

Specifically, the City seeks a declaration that the TNRCC may not grant any additional *173 permits for CAFOs in the Bosque River watershed until it complies with certain federal regulations that have been incorporated into state
law. See 30 Tex. Admin. Code § 305.538 (1999) (Tex. Natural Res. Conservation Comm’n, Prohibitions for TPDES Permits) ( “ no permit may be issued under the conditions p rohibited in 40 Code of Federal Regulations §

122.4 , as amended ” ). The City maintains that it seeks resolution of a pure question of law: whether section 122.4(i) operates to bar all new permits until the TNRCC has developed an implementation scheme to reduce pollution in the two impaired segments of the Bosque River. The TNRCC contends that its compliance with the regulations can only be determined in the context of a permit application on the facts presented by a particular application. Because we agree with the City that its request for declaratory relief presents a determination of law, we reverse the distri ct court’s order of dismissal and
remand this cause for consideration on the merits.

FACTUAL AND PROCEDURAL BACKGROUND

During the 1980s, the dairy industry expanded greatly in the North Bosque River watershed. Erath County became the leading county in the state for milk production. This reflects a trend in the dairy industry away from small, geographically scattered dairies toward large

- scale, clustered dairy operations. In e arly 2001, the TNRCC estimated that there were 41,000 milk cows concentrated along the Bosque River watershed. The waste produced by these concentrated operations has impaired the water quality of the adjacent stretches of the North Bosque
River. The TNRCC has identified the primary source of the pollution to be phosphorus, which is a nutrient found in animal waste. The large amounts of phosphorus in the water have caused excessive growth of algae and other aquatic plants, which in turn potentially cause di staste and odor in drinking water and, under certain circumstances, contribute to the depletion of dissolved oxygen.

Under the federal Clean Water Act, a state is required to

“ identify those waters within its boundaries for which the
effluent limitations required by [the Act] are not stringent enough to implement any water quality standard applicable to such waters. ” 33 U.S.C. § 1313(d)(1)(A) (2001). In 1998, the TNRCC listed two segments of the Bosque River as “ impa ired under narrative water quality standards related to nutrients and aquatic plant growth. ” Once the TNRCC identified the water segments as impaired, it was required to develop a Total Maximum Daily Load (TMDL), which is a plan for assimilation of the pol lutants that are present in the water. See id. § 1313(d)(1)(C)

. 3 The TNRCC describes a TMDL as

3 Under the Clean Water Act, the TNRCC is also required to develop a “ continuing planning process ” for reducing the pollution and bringing the water segments up to state water quality standards for nutrients and pathogens. See 33 U.S.C. § 1313(e) (2001). This process must include, in part, plans for “ effluent limitations and schedules of compliance at least as stringent as those [required under provisions of the Clean Water Act], ” “ the inco rporation of all elements of any applicable area

- wide waste management plans, ” total maximum daily loads for pollutants in accordance with subsection (d), and “ adequate implementation, including schedules of compliance, for revised or new water quality sta ndards. ” Id.

a quantitative plan that determines the amount of a particular pollutant that a water body can receive and still meet its applicable water quality standards. In other words, TMDLs are the best possible estimates of the assimilative capacity of the water body for a pollutant under *174 consideration. A TMDL is commonly expressed as a load, with units of mass per time period, but may be expressed in other ways also. TMDLs must also estimate how much the po llutant
load needs to be reduced from current levels in order to achieve water quality standards. More than three years after the TNRCC identified the watershed as impaired, the TNRCC had still not established a TMDL plan. Although the agency

“ anticipated ” in late 1999 that it would be able to submit a proposed TMDL to the Environmental Protection Agency (EPA) by the spring of 2000, the TNRCC did not complete a TMDL until early 2001.
The TNRCC has now sent a TMDL to the EPA for

© 2015 Thomson Reuters. No claim to original U.S. Government Works. 2City of Waco v. Texas Natural Resource Conservation Com’n, 83 S.W.3d 169 (2002)

approval; at the time the par ties submitted their briefs in this cause, however, the TMDL had not been approved by that agency. The TMDL confirms that a major controllable source of the phosphorus in the water comes from the dairy farms
concentrated in the watershed. It recommends tha t forty to sixty percent reductions in phosphorus loadings in some areas and fifty percent overall will be needed to reduce the potential for problematic algae growth. The City notes various problems with the proposed TMDL. The City argues that its recomme ndations are based on now outdated information; the number of permits currently pending with the TNRCC, if approved, would increase the number of authorized cows by 20,000, so the previously
recommended levels of the TMDL will not achieve
attainment of wat er quality standards. 4 In addition, the TMDL does not establish the amount of phosphorus loadings, allocated among the dairies and other dischargers, that could be tolerated without violating water quality standards for pathogens and nutrients. Nor does it implement compliance schedules for the dairies and other dischargers to reduce the pathogens in the two impaired water segments.

4 The TMDLs are based on data that was collected during the mid

– 1990s. The TNRCC has noted similar concerns with the reliability of the da ta. An interagency
memo states that the TMDL’s “ demonstration of feasibility is based in large part on computer model simulations that estimated the amount of dairy waste to be applied and otherwise disposed of based on the number of dairy cows existing or permitted in the watershed. If the waste projection changes significantly due [to] increasing number of animals, the model numbers are less useful for supporting TMDL approval. ”

Compounding these failures with respect t o existing dischargers, the City asserts that the TNRCC has worsened the situation by approving new applications for additional discharges of waste into the already polluted river. With the exception of certain small operations, the
dairies in the watershe d are required to obtain CAFO permits from the TNRCC that allow them to discharge waste from their operations. The City asserts that since declaring the segments impaired, the TNRCC has continued to grant permits for new and expanded uses under an evolving “ interim policy. ” Although this interim policy has taken slightly different forms in recent years, the City asserts that every phase of the policy grants the agency the discretion to issue new permits, contrary to the regulations prohibiting additional CA FOs until the TNRCC implements measures that will improve the water quality to meet state standards. The Executive Director of the TNRCC testified that the agency will exercise its discretion to grant new permits as long as the additional discharge will not worsen the

“ environmental status quo ” of the impaired river. The agency also points to a rule that it says embodies this policy. See 30 Tex. Admin. Code § 321.33 (2001) *175 (Tex. Natural Res. Conservation Comm’n, Confined Animal Feeding Operations, Applicability). 5 The City argues that the TNRCC’s current discretionary policy is at odds with state law which requires that a sufficient
allocation be available for the water to receive the additional loading and still meet state water quality
standards. See id. § 305.538 (1999) (prohibiting permit
that would violate 40 C.F.R. § 122.4 ). The City sought a
declaration that

5 The current administrative code is cited for
convenience.

until the TNRCC promulgates legally binding regulations to implement TMDLs for nutrients and pathogens in the two Bosque Se gments that contain
load allocations and other measures that will assure compliance with the state water quality standards, no permit may be issued to construct or operate a new
CAFO ... within the watershed. The TNRCC argues that the City’s suit would not be ripe until the TNRCC issued a specific permit. The district court agreed with TNRCC and dismissed the suit. The City now appeals from that judgment.

DISCUSSION

[2] [3] [4] [5] Ripeness implicates subject

- matter jurisdiction and emphasizes the requirement of a concrete injury in order to present a justiciable clai m. Waco Indep. Sch. Dist. v. Gibson, 22 S.W.3d 849, 851 (Tex.2000) ; Patterson v. Planned Parenthood, 971 S.W.2d 439, 442 (Tex.1998) . Ripeness is co ncerned with when an action can be brought and seeks to conserve judicial time and
resources for real and current controversies rather than hypothetical or remote disputes. Gibson, 22 S.W.3d at 851; Patterson, 971 S.W.2d at 442

– 43. Courts of this state may not issue advisory opinions. Patterson, 971 S.W.2d at 443; Texas Ass’n of Bus. v. Texas Air Control Bd., 852 S.W.2d 440, 444 (Tex.1993) . An opinion issued in a case that is not ripe would address only a hypothetical injury rather than remedying actual or imminent harm.

See Texas Ass’n of Bus., 852 S.W.2d at 444

.

© 2015 Thomson Reuters. No claim to original U.S. Government Works. 3City of Waco v. Texas Natural Resource Conservation Com’n, 83 S.W.3d 169 (2002)

[6] [7] [8] In determining whether a cause is ripe for judicial consideration, we look to see whether the facts have sufficiently developed to show that an injury has

occur red, or is likely to occur. Patterson, 971 S.W.2d at

442. A claimant is not required to show that the injury has already occurred, provided the injury is imminent or sufficiently likely. Gibson, 22 S.W.3d at 852; Patterson,
971 S.W.2d at 442. Likewise, a person seeking a declaratory judgment need not have incurred actual injury; a d eclaratory judgment action will lie if the facts show the presence of “ ripening seeds of a controversy. ” Texas Dep’t of Banking v. Mount Olivet Cemetery Ass’n, 27 S.W.3d 276, 282 (Tex.App.

- Austin 2000, p et. denied) (quoting Texas Dep’t of Pub. Safety v. Moore, 985 S.W.2d 149, 153

– 54 (Tex.App.

- Austin 1998, no pet.) ).

[9] The City contends that its claim that section 122.4(i) of the Code of Federal Regulations, which has been incorporated into state law, prohibits the TNRCC from issuing permits for new 6 CAFOs in the watershed until the TNRCC develops compliance schedules and pollutant load allocations is ripe. Section 122.4(i) reads:

6 A CAFO that currently operates under a permit may also seek a permit for additional or expanded uses. Section 122.4(i) applies only to a permit for a new source or discharger. See 40 C.F.R. § 122.4(i) (2001). Therefore, the City has stipulated that its appeal is limited to permits for new CAFOs.

No permit may be issued [t]o a new source or a new discharger, if the discharge from its construction or operation *176 will cause or contribute to the violation of water quality standards. The owner or operator of a

n ew source or new discharger proposing to discharge into a water segment which does not meet applicable water quality standards or is not expected to meet those standards even after the application of the effluent limitations required by sections 301(b)(1)( A) and 301(b)(1)(B) of CWA, and for which the State or interstate agency has performed a pollutants load allocation for the pollutant to be discharged, must demonstrate, before the close of the public comment period, that:

(1) There are sufficient remainin g pollutant load allocations to allow for the discharge; and

(2) The existing dischargers into that segment are subject to compliance schedules designed to bring the segment into compliance with applicable water quality standards. The Director may waive th e submission of information by the new source or new discharger required by paragraph (i) of this
section if the Director determines that the Director already has adequate information to evaluate the request. An explanation of the development of
limitation s to meet the criteria of this paragraph (i)(2) is to be included in the fact sheet to the permit under § 124.56(b)(1) of this chapter.

40 C.F.R. § 122.4(i) (2001) (Envtl. Prot. Agency, Nat’l Pollutant Discharge Elimi nation Sys., Prohibitions) (emphasis added). The City interprets section 122.4(i)
to mean that “ no discharge permit may be issued to a new CAFO within the impaired watershed until the TNRCC promulgates regulations to implement TMDLs for phosphorous and pathogens in the two Bosque Segments that contain load allocations and compliance
schedules. ” Under the TNRCC’s interpretation, section 122.4(i) does not obligate the agency to deve lop load allocations and compliance schedules before it issues a new discharge permit; rather, it merely limits the TNRCC’s ability to issue permits that would “ cause or contribute to the violation of water quality standards. ” Whether a new permit will cau se or contribute to the violation of water quality standards, the agency continues, depends on the specific conditions and terms of a given permit. The TNRCC argues that the City’s claim does not present a pure question of law because the agency’s complian ce with section 122.4(i) can only be determined in the context of an application for a permit. Thus, according to the TNRCC, the City’s claim is not ripe until the agency approves a permit, because only at that point can one determine whether the permit will cause or contribute to a violation of water standards. The agency also emphasizes
that variations between state and federal law affect whether a particular permit violates sectio n 122.4(i)

.

The City responds that the particular conditions of any permit are irrelevant because under the agency’s rules and policy, every new permit to discharge into impaired
waters violates section 122.4(i)

. The City points to the rules governing CAFOs, 7 which specifically authorize discharges in “ chronic or catastrophic rainfall events. ” See 30 Tex. Admin. Code §§ 321.31 (b), .32 (8), .34

, .39 (f)(19)(E) (2001) (Tex. Natural Res. Conservation Comm’n, Concentrated A nimal Feeding Operations).
*177 The City also maintains that the TNRCC’s own evidence indicates that only about half of the waste produced by CAFOs is ever “ collectible. ” Even if all of
the “ collectible waste ” is preve nted from entering the watershed, other uncollectible waste is not. Therefore, issuing an additional permit without pollutant load allocations and compliance schedules will violate section 122.4(i) , regardless of the conditions that are imposed. Furthermore, according to the City, differences between

© 2015 Thomson Reuters. No claim to original U.S. Government Works. 4City of Waco v. Texas Natural Resource Conservation Com’n, 83 S.W.3d 169 (2002)

state and federal law are not relevant to its declaratory judgment suit, which is premised solely on the basis of state law. The City notes that section 122.4(i) has been incorporated into and become part of state law, and that its claim is based on the TNRCC’s failure to implement standards to comply with state, not federal, water quality
standards.

7 These are the rules that currently govern the CAFO permit process. See Tex. Water Code Ann. § 26.503(b)(1) (West Supp.2002) (st ating that an individual permit must “ provide for management and disposal of waste in accordance with Subchapter B, Chapter 321, Title 30, Texas Administrative Code ” ).

[10] We conclude that the question of whether section 122.4(i) operates to prohibit the TNRCC from approving any new discharge permits until it adopts the necessary pollution

- reduction measures pr esents a purely legal inquiry. In determining ripeness, courts should examine (1) the fitness of the issues for judicial decision, and (2) the hardship occasioned to a party by the court’s denying judicial review. Office of Pub. Util. Counsel v. Public Util. Comm’n, 843 S.W.2d 718, 724 (Tex.App.

- Austin 1992, writ denied) . The City’s claim poses a purely legal question

- the interpretation of section 122.4(i)

- which will not benefit from the development of additional facts in connection with a specific permit application. The
TNRCC asserts that the issues are not fit for decision because the City has failed to challenge a final agency action. Citing provisions in the Wate r Code and the Administrative Procedure Act (APA), the TNRCC emphasizes that judicial review is limited to agency rulings, orders, decisions, or other acts, or the validity or applicability of a rule. See Tex. Water Code Ann. § 5.351 (West 2 000) ; Tex. Gov’t Code Ann. § 2001.038 (West 2000)

.

[11] [12] The City, however, has asserted a different basis for its lawsuit, specifically, sections 37.002

– .004 of the Uniform Declaratory Judgments Act (UDJA). See Tex. Civ. Prac. & Rem.Code Ann. §§ 37.002

– .004 (West
199 7). Under that Act, a claimant’s access to judicial review is not limited to review of agency rules; instead, the Act provides a basis by which a claimant can obtain a declaration of rights, status, or other legal relations under a writing or a statute. Se e id. § 37.004. A suit under the UDJA is not confined to cases in which the parties have a cause of action apart from the Act itself. Texas Dep’t of Pub. Safety v. Moore, 985 S.W.2d 149, 153 (Tex.App.

- Austi n 1998, no pet.) . The legislature intended the UDJA to be remedial, to settle and afford relief from uncertainty and insecurity with respect to rights, and to be liberally construed. Tex. Civ. Prac. & Rem.Code Ann. §

37.002 ; Moore, 985 S.W.2d at 153

.

[13] The TNRCC also questions the fitness of the issues for decision, asserting that the Cit y’s request will affect additional parties who are not present to defend their interests. The City responds that it is questionable that any such additional parties would have adequate standing to participate in a challenge to an individual permit.
Further more, the TNRCC’s assertion does not go directly to the ripeness inquiry, which determines when an action may be brought, that is, “ whether the facts have developed sufficiently so that an injury has occurred or is likely to occur, rather than being contin gent or remote. ”

See Patterson, 971 S.W.2d at 442. The facts have sufficiently developed as between the TNRCC and the City such that the dispute is not hypothetical. In addition,
an interested *178 party may intervene in the proceedings
on remand. See Tex.R. Civ. P. 60

.

Moreover, the denial of judicial review will result in hardship to the City. Under the APA, a permit issued in a
contested case is final, even while an appeal is pending.

See Tex. Gov’t Code Ann. § 2001.144 . The effect of forcing the City to wait until the TNRCC has granted another permit means, in effect, that Lake Waco could become more polluted with the additio nal discharge while the parties litigate their dispute. Moreover, the City could suffer multiple harms from multiple additional CAFOs, and be forced to make this same legal argument in numerous appeals. Thus, the City’s claim satisfies both prongs of the r ipeness inquiry.

Furthermore, the City’s claim is appropriately brought pursuant to the Declaratory Judgment Act. Under that act, a claimant must show that (1) a justiciable controversy exists as to the rights and status of the parties; and (2) the

contr oversy will be resolved by the declaration sought.
Moore, 985 S.W.2d at 153. There is a justiciable controversy between the parties regarding the effect of
section 122 .4(i) on the agency’s permitting process. T he City asserts that the TNRCC has a duty to improve the water quality of the impaired river segments without further delay, and that the agency has no discretion to issue new CAFO permits until it takes these affirmative steps. The TNRCC responds that it has the discretion to grant additional permits that do not worsen the environmental status quo. A declaration regarding the
effect of section 122.4(i) on the agency’s authority to issue new CAFO permits will resolve t his controversy. Therefore, we hold that the trial court had jurisdiction to hear the City’s claim under the UDJA and that the issue is ripe for adjudication. 8

© 2015 Thomson Reuters. No claim to original U.S. Government Works. 5Firemen’s Ins. Co. of Newark, N. J. v. Burch, 442 S.W.2d 331 (1968)

442 S.W.2d 331 Supreme Court of Texas.

FIREMEN’S INSURANCE COMPANY OF

NEWARK, NEW JERSEY, Petitioner,

v. Jesse L. BURCH et ux., Respondents.

No. B

— 914. | Oct. 9, 1968. | Rehearing Denied Oct. 30, 1968. | Second Rehearing Denied and Dissenting Opinion Jan. 22, 1969.

Suit for declaratory judgment to determine liability of insurer of automobile. The 53rd District Court, Travis County, Jones, J., rendered judgment that insurer was obligated to defend defendant husband of driver and since husband was responsible for torts of wife was obligated to pay any judgment rendered against him, and insurer appealed. The Austin Court of Appeals, Third Supreme Judicial District, 426 S.W.2d 306, affirmed District Court judgment an d insurer brought error. The Supreme Court, Norvell, J., held that whether insurer had duty to defend defendant husband of driver was justiciable issue but that District Court had no power to render advisory opinion on hypothetical question of whether insu red was liable for
wife’s torts before it had been established that she was liable to plaintiff.

Affirmed in part and reversed in part.

Smith, J., dissented on Motion for Rehearing.

Attorneys and Law Firms

*332 Small, Herring, Craig, Werkenthin & Shannon, C. C. Small, Jr., Charles Herring and Bob E. Shannon, Austin, for petitioner.

Garey, Colbert & Kidd, Joe Colbert, Austin, for respondents.

O pinion

NORVELL, Justice.

On December 1, 1965, Dorothy Burch was injured in a collision between the car in which she was riding and an automobile driven by Sarah Buttler, the wife of Larry Buttler. Dorothy Burch and her husband, Jesse L. Burch, sued Sarah and Larry Buttler for damages and this action has not been determ ined. On December 7, 1966, Jesse L. and Dorothy Burch filed this suit in the form of a declaratory judgment against Firemen’s Insurance Company of Newark, New Jersey. The insurance company filed a cross

- action and the trial court entered a declaratory judg ment decreeing that:

‘ (T)he defendant Firemen’s Insurance Company of Newark, New Jersey, is obligated by virtue of its Policy No. AFT 322361 to defend Larry J. Buttler in Cause No. 152,097 styled Dorothy M. Burch, et vir v. Sarah C. Buttler, et vir, in the 53rd Judicial District Court of Travis County, Texas, and that since Larry J. Buttler is liable for the torts of his wife, Sarah C. Buttler, committed during their marriage, the defendant, Firemen’s Insurance Company of Newark, New Jersey, is obligated by virtue of Policy No. AFT 322361 to pay on behalf of Larry J. Buttler any judgment rendered against him in said Cause No. 152,097 to the full extent of its policy coverage, * * *. ’

The court also declared that the insurance company was not obligated to d efend Sarah C. Buttler 1 and was ‘ not obligated to pay any judgment rendered against her ’ in the
case of Burch v. Buttler. This dec laratory judgment was affirmed by the Court of Civil Appeals. 426 S.W.2d 306

.

1 Larry Buttler and Sarah Buttler have been di vorced and at the time of the rendition of judgment in this cause, May 10, 1967, Sarah was the wife of Hilton Cromier. She will, however, be referred to herein as Sarah
Buttler.

[1] The question of the insurance company’s duty to defend presented a justiciable issue. No complaint is made of the trial court’s disposition of this issue and that portion of the trial court’s judgment relating thereto will
not be d isturbed. However, that portion of the decree which attempts to declare the liability of the insurance company upon any judgment *333 which may hereafter be rendered in the case of Burch v. Buttler is purely advisory in nature and beyond the power and jurisdiction of the district court to render. Accordingly, such portion of the trial court’s judgment is vacated.

[2] [3] [4] This court has repeatedly held that under our Constitution, the judici al power does not embrace the

© 2015 Thomson Reuters. No claim to original U.S. Government Works. 1Firemen’s Ins. Co. of Newark, N. J. v. Burch, 442 S.W.2d 331 (1968)

giving of advisory opinions. Morrow v. Corbin, 122 tex. 553, 62 S.W.2d 641 (1933) ; California Products, Inc. v. Puretex Lemon Juice, Inc., 160 Tex. 586, 334 S.W.2d 780 (1960) ; Unite d Services Life Insurance Co. v. Delaney, 396 S.W.2d 855 (Tex.Sup.1965) , and authorities therein
cited. Article 5, s 8 of the Texas Constitution , Vernon’s Ann.St. does not empower the district courts to render such opinions and as juri sdiction is a matter of constitutional delineation, the Legislature could not and has not by the passage of the Uniform Declaratory Judgments Act, empowered the district courts to render advisory opinions. In 1960, this court again reiterated the principle that the giving of such opinions is not a judicial function, but that in governmental affairs, the duty to render advisory opinions is vested in the executive branch of government and that in private business, the giving of legal advice is the function of the legal profession. California Products, Inc. v. Puretex Lemon Juice, Inc., 160 Tex. 586, 334 S.W.2d 780 (1960) . Also in the Puretex case, this court cited and quoted from Ladner v. Siegel, 294 Pa. 368, 144 A. 274 (1928)

, as correctly laying down the proposition that the Declaratory Judgments Act gives the court no power to pass upon hypothetical or contingent situations, or determine questions not then essential to the decision of an actual controversy, although such ques tions may in the future require adjudication.

Puretex controls this case. The parties have posed a problem which is hypothetical, ‘ iffy ’ and contingent. Firemen’s Insurance Company, as petitioner here, presents the following points of error:

‘ The Court o f Civil Appeals erred in holding that Larry Buttler was legally obligated within the terms of the insurance policy here involved to pay damages occasioned by the tort of his wife (Sarah Buttler) even though he in no way participated therein. ’

‘ The Court of Civil Appeals erred in failing to hold that in any event Larry Buttler’s legal obligation for a tort of his wife, not participated in nor aided or abetted by him, should be the amount of his interest in the community estate of the marriage subject to ex ecution and consequently petitioner’s liability under its policy would
be limited to such amount. ’

[5] The contentions raised by these points present interesting que stions of law as is demonstrated by the opinion of the Court of Civil Appeals. The question posed is whether or not under the facts of this case, Larry Buttler is liable for the torts of his wife, Sarah Buttler. But, no court has yet decided whether Mrs. B uttler has committed a tort which would render her liable in damages to Mrs.
Burch. That is the issue involved in the untried cause of Burch v. Buttler. At present, the question is hypothetical

— ‘ If Mrs. Buttler be held liable to Mrs. Burch for damages in t ort, is Larry Buttler to be held liable also although he did not aid or abet in the conduct of his wife, which is alleged to be tortious. ’ Should this question be answered, then the following ‘ iffy ’ question arises. If Larry Buttler be held liable for his wife’s tort, should the liability of the petitioner insurance company be limited to the amount of his interest in the community estate of the marriage subject to execution?

Of course, If Mrs. Burch should fail to establish her case against Mrs. Buttler, the questions raised by petitioner’s points would be purely academic and we would have had a considerable amount of judicial wheel spinning for nothing.

*334 We can well appreciate that the parties would prefer
a definit e answer by this court to the questions posed by petitioner’s points rather than to take an ‘ educated guess’ based upon a study of our prior decided cases and authoritative materials as to what we would hold,

— as, if and when the questions are presented in justiciable form. However, the giving of advice as to proposed or possible settlements is not a judicial function. As a practical matter if for no other reason, this must be left to the profession.

In Lide v. Mears, 231 N.C. 111, 56 S.E.2d 404 (1949)

, cited with approval in the Puretex case, the North Carolina Supreme Court said:

‘ There is much misunderstanding as to the object and scope of this legislation (Uniform Declaratory Judgment Act). Despite some notions to the contrary, it does not undertake to convert judicial tribunals into counsellors and impose upon them the duty of giving advisory opinions to any parties who may come into court
and ask for either academic enlightenment or practical guidance concerning their legal affairs. Town of Tryon v. Duke Power Co., 222 N.C. 200, 22 S.E.2d 450; Allison v. Sharp, 209 N.C. 477, 184 S.E. 27; Poore v. Poore, 201 N.C. 791, 161 S.E. 532; Anderson on Declaratory Judgments, section 13. This
observatio n may be stated in the
vernacular in this wise: The Uniform Declaratory Judgment Act does not license litigants to fish in judicial ponds for legal advice. ’

© 2015 Thomson Reuters. No claim to original U.S. Government Works. 2Railroad Com’n of Texas v. CenterPoint Energy Resources..., Not Reported in...

2014 WL 4058727

2014 WL 4058727 Only t he Westlaw citation is currently available.

SEE TX R RAP RULE 47.2 FOR DESIGNATION
AND SIGNING OF OPINIONS.

MEMORANDUM OPINION Court of Appeals of Texas,
Austin.

The RAILROAD COMMISSION OF TEXAS, Appellant

v. CENTERPOINT ENERGY RESOURCES CORP. d/b/a CenterPoint Energy Entex and CenterPoint Energy Texas Gas, Appellee. The Railroad Commission of Texas, Appellant

v. Texas Gas Service Company, a Division of ONEOK, Inc., Appellee. The Railroad Commission of Texas, A ppellant

v. CenterPoint Energy Resources Corp. d/b/a CenterPoint Energy Entex and CenterPoint Energy Texas Gas, Appellee.

Nos. 03

– 13

– 00533

– CV, 03

– 13

– 00534

– CV,
03

– 13

– 00535

– CV. | Aug. 14, 2014.

From the District Court of Travis County, 98th Judicial
District , No. D

– 1

– GN

– 10

– 003981, Stephen Yelenosky

, Judge Presiding. From the District Court of Travis County, 200th Judicial District, No. D

– 1

– GN

– 10

– 003983, Stephen Yelenosky

, Judge Presiding. From the District Court of Travis County, 126th Judicial District, No. D

– 1

– GN

– 10

– 003982, Stephen Yelenosky

, Judge Presiding.

Attorneys a nd Law Firms

Douglas Fraser , Assistant Attorney General, Environmental Protection Division, Kellie E. Billings, Assistant Attorney General, Environmental Protection & Admin. Law Division, Austin, TX, for Appellant.

Dane McKau ghan , Greenberg Traurig, LLP, Austin, TX, for Appellee.

Before Justices PURYEAR

, GOODWIN , and FIELD

. MEMORANDUM OPINION

MELISSA GOODWIN , Justice.

*1 The Texas Railroad Commission (the Commission) appeals the trial court’s reversal in part of its final orders in three annual review proceedings under cos t

- of

- service adjustment (COSA) tariffs involving essentially identical issues. CenterPoint Energy Resources Corp. d/b/a CenterPoint Energy Entex and CenterPoint Energy Texas Gas (CenterPoint) and Texas Gas Service Company, a Division of ONEOK, Inc. (Texas Gas) (the Utilities) sued for judicial review of final orders issued by the Commission denying the Utilities’ recovery of certain expenses for meals, lodging, and other items and ordering certain guidelines for recovery of similar expenses in
future COSA r eviews. Because we conclude that the Utilities’ claims are not ripe, we reverse the trial court’s judgment and dismiss the Utilities’ claims.

FACTUAL AND PROCEDURAL BACKGROU ND

In April 2010, the Utilities applied for cost

- of

- service adjustments to their rates pursuant to annual reviews authorized under their respective COSA tariffs for certain
service areas. Rates for the affected customers were initially determined in contes ted case hearings that resulted in the adoption of tariffs with COSA clauses. A COSA clause is a formula included in a utility’s tariff that allows adjustments to customer charges without the necessity of a full

- blown “ Statement of Intent ” rate case.
See Texas Coast Utils. Coal. v. Railroad Comm’n, 423 S.W.3d 355, 357, 374 (Tex.2014) (upholding authority of Commission to adopt gas utility rate schedule providing for automatic annual adjustments base d on increases or decreases in utility’s cost of service, i.e., COSA clause). The terms of a COSA clause vary depending on what is approved as part of the tariff in the rate case. The tariffs in these cases provide that the annual rate adjustment is to be determined by a calculation based on calendar year operating expenses, return investment, and certain taxes. If the resulting change is positive, the amount charged goes up; if it is negative, the amount charged goes down. The adjustment is capped at 5% of the customer charge that was in effect at the end of the preceding calendar year in CenterPoint’s tariffs and at the percentage change in
the Consumer Price Index for All Urban Consumers in Texas Gas’s tariff. These were the first COSA filings

© 2015 Thomson Reuters. No claim to original U.S. Government Works. 1Railroad Com’n of Texas v. CenterPoint Energy Resources..., Not Reported in...

2014 WL 4058727

made by the Utilities under their respective tariffs.

A COSA tariff annual review is a streamlined procedure that does not include a hearing; instead, the adjustment is determined following staff review of the evidence filed by the utility. In each of the present c ases, the Commission questioned and ultimately disallowed certain expenses for meals, travel, and other items for which the Utilities could not produce itemized receipts. 1 In its final orders, the Commission made certain findings of fact and conclusions of law concerning the disallowed expenses
and included two “ ordering paragraphs ” requiring the Utilities to meet certain evidentiary criteria for recovery of similar expenses in the future. 2 The two ordering

par agraphs provided:

1 The removal of the disputed expenses did not result in any change to the Utilities’ proposed adjustments, and
the record reflects that the Utilities withdrew their requests for the questioned expenses.

2 In each case, ca lculation errors not relevant to this appeal were corrected and a nunc pro tunc order issued.

*2 IT IS FURTHER ORDERED that [the Utilities] shall not include any employee or contractor expenses from employee or contractor expense reports reimbursement in future COSA filings that cannot be supported by a detailed itemized receipt which shows the specific amounts and line item charges.

IT IS FURTHER ORDERED that [the Utilities] shall identify and justify each meal expense th at exceeds $25.00 per person and any lodging expense over $150.00 per person per night that [the Utilities] propose[ ] to include in future COSAs. The Utilities filed motions for rehearing complaining that the findings of fact, conclusions of law, and ordering paragraphs concerning the disallowed expenses were statements of new policy, not backed by any rule or guideline, and were therefore made thro ugh unlawful procedure, arbitrary and capricious, and not supported by
substantial evidence. The Commission denied the motions for rehearing, and the Utilities filed suits for judicial review asserting the same claims. See Tex. Util.Code § 105.001(a) (any party to proceeding before Commission entitled to judicial review under substantial evidence rule). The Commission filed motions to dismiss based, in part, on its contention that the Utilities were requesting advisory opinions because their claims are not ripe. The
trial court denied the Commission’s motions to dismiss and reversed the final orders, finding that the Commission acted arbitrarily and capriciously by imposing a new policy in the orders and that the policy was made through unlawful procedure an d was not supported by substantial evidence. These appeals followed.

DISCUSSION

In its first issue, the Commission argues that the Utilities’ claims are not ripe and they th erefore seek an impermissible advisory opinion. 3 The Commission contends that the Utilities request a predetermination of a hypothe tical matter that could arise in the future, which is not a matter fit for judicial consideration. The Utilities argue that the orders “ expressly appl [y] ... to future COSA proceedings, ”“ mandate the manner in which all future rate adjustments filed pursua nt to the applicable COSA tariff will be resolved, ” and “ fundamentally change the way in which COSA adjustments are calculated in future COSA proceedings. ” They further contend that the orders place “ obligations and burdens on [them] now, and that failure t o abide by these new obligations and burdens could bar recovery in a future COSA proceeding. ” Thus, the Utilities contend, they seek real relief and an opinion that will affect “ all COSA cases [they] will file in the future, ” not an advisory opinion.

3 The Commission also contends that the Utilities lack standing because in their motions for rehearing, they did not challenge the Commission’s final decisions on rate adjustments and instead attacked only the underlying findings of fact and conclusions of law. This Court has held that to have standing to seek judicial review, one must be aggrieved by the final order and not merely by an underlyin g finding or conclusion, see GTE Sw. Inc. v. Public Util . Comm’n of Tex., 37 S.W.3d 546, 548 (Tex.App.

- Austin 2001, no pet.) (citing Champlin Exploration, Inc. v. Railroad Comm’n, 627 S.W.2d 250, 252 (Tex.App.

- Austin 1982, writ ref’d n.r.e.) ). However, the Utilities’ motions for rehearing expressly challenged the ordering paragraphs as well as the findings and conclusions. We overrule the Commission’s first issue as to this argument.

“ The courts of this state are not empowered to give advisory opinion s[, and] [t]his prohibition extends to cases that are not yet ripe. ” Patterson v. Planned Parenthood of Hous. & Se. Tex., Inc., 971 S.W.2d 439, 443 (Tex.1998) (citations omitted). The ripeness doctrin e

“ serves to avoid premature adjudication ” and “ focuses on
whether the case involves ‘ uncertain or contingent future events that may not occur as anticipated, or indeed may

© 2015 Thomson Reuters. No claim to original U.S. Government Works. 2Railroad Com’n of Texas v. CenterPoint Energy Resources..., Not Reported in...

2014 WL 4058727

not occur at all. ’ “ Perry v. Del Rio, 66 S.W.3d 239, 250 (Tex.2001) (citations omitted). “ A case is not ripe when its resolution depends on contingent or hypothetical facts, or upon events that have not yet come to pass. ” Pat terson, 971 S.W.2d at 443

. “ Ripeness is both a question of timing, that is, when one may sue, a question of discretion, or whether the court should hear the suit, and
not whether it can hear the suit. ” Atmos Energy Corp. v. Abbott, 127 S.W.3d 852, 858 (Tex.App.

- Austin 2004, no pet.) (internal citations omitted) (citing Perry, 66 S.W.3d
at 249

– 50 ; Patterson, 971 S.W.2d at 442 ; City of Waco v.
Texas Natural Res. Conserv. Comm’n, 83 S.W.3d 169, 177 (Tex.App.

- Austin 2002, pet. denied) ). “ In the
administrative

- law context, moreover, avoiding premature litigation over administrative determinations prevents
courts from ‘ entangling themselves in abstract disagreements over administrative policies’ while simultaneously allowing the agency to pe rform its functions unimpeded. ” Trinity Settlement Servs., LLC v. Texas State Secs. Bd., 417 S.W.3d 494, 506 (Tex.App.

- Austin 2013, pet. denied) (quoting Patterson,
971 S.W.2d at 443 ). The determination of ripeness depends on “ (1) the fitness of the issues for judicial decision; and (2) the hardship occasioned to the party by the court’s denying judicial review. ” Atmos Energy, 127
S.W.3d at 858 (citing Perry, 66 S.W.3d at 250 (citing Abbott Labs. v. Gardner, 387 U.S. 136, 149, 87 S.Ct. 1507, 18 L.Ed.2d 681 (1967 ) ; City of Waco, 83 S.W.3d at

177 )). Ripeness should be decided on the basis of all the information available to the court, and we may consider intervening events that occur after the decision i n the
lower court. Perry, 66 S.W.3d at 250 ; 13 Charles Alan Wright, Arthur R. Miller, & Edward H. Cooper, Federal
Practice & Procedure § 3532.1, at 136

– 37 (2d ed.1984)

.

*3 We do not believe the Utilities have affirmatively established that the issues they presented were fit for
review and that the failure to address those issues would constitute a hardship on the Utilities. See Perry, 66
S.W.3d at 250 ; Atmos Energy, 127 S.W.3d at 858

. Whether there may be an actual controversy between the
Utilities and the Commission is too u ncertain and speculative to support the Utilities’ contention that their claims are ripe. Because the Utilities complain of future enforcement, they must show that enforcement is

“ imminent or sufficiently likely. ” See Trinity Settlement,
417 S.W.3d at 506 ; Rea v. State, 297 S.W.3d 379, 383 (Tex.App.

- Austin 2009 , no pet.) (to establish ripeness, plaintiffs must demonstrate injury is imminent, direct, and immediate, not merely remote, conjectural, or hypothetical); Atmos Energy, 127 S.W.3d at 856 ; City of
Waco, 83 S.W.3d at 175 . A perceived threat of enforcement does not create a justiciable controversy. Compare Mitz v. Texas State Bd. of Veter inary Med. Exam’rs, 278 S.W.3d 17, 25 (Tex.App.

- Austin 2008, pet. dism’d)

, with Beacon Nat’l Ins. Co. v. Montemayor, 86 S.W.3d 260, 267

– 68 (Tex.App.

- Austin 2002, no pet.)

.

The Utilities attemp t to characterize their claims as ripe by arguing that the language of the ordering paragraphs will require them to meet evidentiary requirements in all future annually required COSA filings and that the orders place “ obligations and burdens ” on them now. Tellingly, however, the Utilities argue that their failure to meet these obligations and burdens could bar recovery in a future COSA proceeding. This perceived threat as to future COSA filings does not rise to the level of imminent or likely injury so as t o present a justiciable claim. See Mitz,
278 S.W.3d at 25 (contrasting actual initiation of administrative action suggesting imminent proceeding in that case with mere perceived threat in Beacon Nat’l, 86
S.W.3d at 267

– 68 ). And while we may consider intervening events that occur after a decision in the lower

court, see Perry, 66 S.W.3d at 250 , the Utilities have not presented any evidence that the Commission has taken any steps to impose the requirements on them since issuing the final orders or that there is any existing or continuing threat of liability or penalty. Cf. Mitz, 278
S.W.3d at 25

– 26 (constitutional claim ripe for review considering continuing threat of civil and criminal liability against practitioners and direct effect act had on business enterprise); Patel v. Texas Dep’t of Licensing & Regulation, No. 03

– 11

– 00057

– CV, 2012 Tex.App. LEXIS 6187, at *23,2012 WL 3055479 (Tex.App.

- Austin July 25, 2012, pet. granted) (constitutional claims ripe where appellants subject to continuing threat of civil and

c riminal liability, as well as administrative penalties and sanctions). Thus, the Utilities have not established that enforcement is imminent or sufficiently likely, see Trinity Settlement, 417 S.W.3d at 506 ; Atmos Energy, 127
S.W.3d at 856 ; City of Waco, 83 S.W.3d at 175 , and we
conclude that the Utilit ies’ issues are not fit for judicial review, see Perry, 66 S.W.3d at 250 ; Atmos Energy, 127
S.W.3d at 858

.

*4 To prevail, the Utilities must show that they would suffer hardship if judicial review is withheld until enforcement of the requirements in the ordering paragraphs. See Perry, 66 S.W.3d at 250 ; Atmos Energy,
127 S.W.3d at 858 . Hardship is shown when the statute, rule, or policy at issue “ ‘ requires an immediate and significant change in the plaintiffs’ conduct of their affairs
with ser ious penalties attached to noncompliance. ’ “ Mitz,
278 S.W.3d at 26 (quoting Abbott Labs. v. Gardner, 387 U.S. 136, 153, 87 S.Ct. 1507, 18 L.Ed.2d 681 (1967) ). When the requiremen t at issue has a direct and immediate impact on the party’s business and places it in jeopardy of sanction or penalty, that is sufficient to show a hardship.

© 2015 Thomson Reuters. No claim to original U.S. Government Works. 3Robinson v. Parker, 353 S.W.3d 753 (2011)

54 Tex. Sup. Ct. J. 1640

353 S.W.3d 753 Supreme Court of Texas.

Carroll G. ROBINSON, Bruce R. Hotze, and Jeffrey N. Daily, Petitioners,

v. Annise D. PARKER, Mayor; City of Houston;

Houston City Council, et al., Respondents.

No. 08

– 0658. | Argued Nov. 18, 2009. | Decided Aug. 26, 2011. | Rehearing Denied Oct. 21, 2011.

Synopsis Background: Citizens, who were sponsors of
citizen

- initiated referendum proposition, brought action against city, mayor, and city council, seeking declaratory judgment that the proposition was valid and must be enforced. The 333rd District Court, Harris County, Joseph
J. Halbach , J., granted citizens motion for summary judgment. Defendants appealed. The Houston Court of Appeals, 260 S.W.3d 463, reversed, concluding that citizens lacked standing. Citizens filed petition for review.

[Holding:] The Supreme Court, Paul W. Green , J., held that citizens’ declaratory claims were not ripe.

Judgments of Court of Appeals and District Court vacated; case dismissed.

Attorneys and Law Firms

*753 William A. ‘ Andy ’ Taylor, Amanda Eileen Staine

Peterson , Andy Taylor & Associates, P.C., Houston, TX,
for Carroll G. Robinson.

Scott J. Atlas , Bill White for Texas, Patrick W. Mizell, Stacey Neumann Vu, Vinson & Elkins LLP, Stephen Douglas Pritchett Jr., David M. Gunn, Beck Redden & Secrest, L.L.P. Arturo G. Michel , City Attorney, City of

Houston Legal Dept., Patrick Zummo , Law Offices of Patrick Zummo, John Berchmans Daily , Weil Gotshal & Manges LLP, Houston, TX, *754 Melanie Plowman
Sarwal , Weil Gothshal & Ma nges LLP, Austin, TX, for
Bill White.

Jonathan Day , Andrews Kurth LLP, Warren W. Harris

, Bracewell & Giuliani, LLP, Houston, TX, for Amicus Curiae Continental Airlines, Inc. David A. Furlow , Thompson & Kni ght, L.L.P., Levi

James Benton , Benton Massey PLLC, Houston, TX, for
Amicus Curiae Francis M. Kubosh.

Opinion

Justice GREEN delivered the opinion of the Court.

In this case, we are asked to decide (1) whether citizens who signed a petition proposing a local ballot initiative have standing to assert their declaratory judgment claims
that the voter

- approved initiative is v alid and must be enforced; and (2) the validity of the voter

- approved initiative. Because the citizens’ claims are not ripe, however, we cannot reach those issues.

I

Petitio ners Carroll G. Robinson, Bruce R. Hotze, and Jeffrey N. Daily are citizens of Houston who participated to varying degrees in efforts to place a proposition regarding city revenues and spending on the ballot for public referendum. Hotze and Daily organized the petition drive and helped draft the final language of the proposal. All three Petitioners signed the petition, donated time and money to campaigns promoting the passage of the proposition, and voted in favor of it.

On November 2, 2004, Houston voter s passed the proposition, called Proposition 2, as well as Proposition 1, which the Houston City Council had placed on the ballot by its own act in response to Prop. 2. 1 Prop. 1 garnered more votes, with 280,596 favorable votes, or 64% of the total, as opposed to 242,697 favorable votes for Prop. 2, or 56% of the total. However, the City of Houston determined that, because Prop. 1 and Prop. 2 conflict, Prop. 2 was ineffec tive and unenforceable. The City based
that determination both on what Petitioners refer to as Prop. 1’s “ poison pill provision, ” 2 and on the conflicting

- ordinance provision in the Houston City
Charter. See Hous., Tex., Code Ordinances, City Charter art. IX, § 19 (2006) ( “ [A]t any election for the adoption of amendments if the provisions of two or more proposed amendments approved at said election are inconsistent the amendment receiving the highest number of votes shall prevail. ” ). The mayor therefore *755 did not certify the results of the passage of Prop. 2 to the secretary of state,
and the ci ty council did not enter an order in the city records declaring that Prop. 2 had been adopted. SeeRobinson v. Parker, 353 S.W.3d 753 (2011)

54 Tex. Sup. Ct. J. 1640

LOC. GOV’T CODEE §§ 9.005(b) (requiring city council to pass an ordinance declaring the adoption of an
initiative that receives a majority of the vote), 9.007 (requiring mayor to certify results of an election that passes a charter amendment to the secretary of state).

1 Prop. 2 was described on the ballot as: The City Charter of the City of Houston shall be amended to require voter approval before the City may increase total revenues from all sources by
more than the combined rates of inflation and population, without requiring any limit of any specific revenue source, including water and sewer revenues, property taxes, sales taxes, fees paid by utilities and developers, user fees, or any other
sources of revenues. Prop. 1 was described on the ballot as:

The Charter of the City of Houston shall be amended to req uire voter approval before property tax revenues may be increased in any future fiscal year above a limit measured by the lesser of 4.5%
or the cumulative combined rates of inflation and population growth. Water and sewer rates would
not increase more than the cumulative combined rates of inflation and population growth without prior voter approval. The Charter Amendment also requires minimum annual increases of 10% in the senior and disabled homestead property tax exemptions through the 2008 tax year.

2 Prop. 1 provides: If another proposition for a Charter amendment relating to limitations on increases in City revenues is approved at the s ame election at which this proposition is also approved, and if this proposition receives the higher number of favorable votes, then this proposition shall prevail
and the other shall not become effective.

Petitioners sought relief from the court of appeals, which granted their petition for writ of mandamus, holding that the City had failed to perform the ministerial duties of certifying the results to the secretary of state and entering an order declaring t he charter amendments to have been adopted. In re Robinson, 175 S.W.3d 824, 826

– 32 (Tex.App.

- Houston [1st Dist.] 2005, orig. proceeding)

. On the same day that they petitioned for mandamus relief, Petitioners filed the underlying suit seeking a declaratory judgment that Prop. 2 is effective and must be enforced. While that case was pending, the city council passed an ordinance recognizing t hat both Prop. 1 and Prop. 2 had passed but also declaring that Prop. 1 had received the higher number of votes. As a result, both propositions became part of the Houston City Charter. See Hous., Tex., Code Ordinances, City Charter art. III, § 1; art. VI

- a , § 7; art. IX, § 20 (2006). The trial court ultimately granted summary judgment in favor of Petitioners. The court of appeals, however, ruled that Petitioners lacked standing to assert their claims, relying on our holding in Brown v. Todd, 53 S.W.3d 297, 305 (Tex.2001)

. 260 S.W.3d 463,
470

– 72 (Tex.App.

- Houston [14th Dist.] 2008, pet. filed)

. The court remanded the case to the trial court to allow Petitioners to amend their pleadings and establish standing. Id. at 466.

Robinson, Hotze, and Daily petition for review on two grounds. 3 First, they assert that the court of appeals erred when it determined that Petitioners lack standing. Second, they ask us to consider the merits of their claim that Prop.
2 should be enforced.

3 The current Houston mayor has been substituted for her predecessor. See TEX.R.APP. P. 7.2(a) (automatic substitution when public officer is party in official capacity).

II

[1] [2] [3] [4] Ripeness “ is a threshold issue that implicates subject m atter jurisdiction ... [and] emphasizes the need for a concrete injury for a justiciable claim to be presented. ” Patterson v. Planned Parenthood of Hous. & Se. Tex., 971 S.W.2d 439, 442 (Tex.1998) . In ev aluating ripeness, we consider “ whether, at the time a lawsuit is filed, the facts are sufficiently developed ‘ so that an injury has occurred or is likely to occur, rather than being contingent or remote. ’ ” Waco Indep. Sch. Dist. v. Gibson, 22 S.W.3d 849, 851

– 52 (Tex.2000) (emphasis in original) (quoting Patterson, 971 S.W.2d at 442). Although a claim is not required to be ripe at the time of filing , if a party
cannot demonstrate a reasonable likelihood that the claim will soon ripen, the case must be dismissed. See Perry v. Del Rio, 66 S.W.3d 239, 251 (Tex.2001)

.

[5] The record is silent as to whether the City has, in fact, failed to comply with the Prop. 2 spending caps. As the parties acknowledged at oral argument, the record in this
case indicates that then

- mayor Bill White, in response to Prop. 2’s inclusion in the City Charter, stated his intention to comply with the caps Prop. 2 imposed. In an attempt to show noncompliance, Petitioners presented several documents with their post

- submission brief. Peti tioners point to a May 2009 letter from then

- *756 controller Annise Parker, who is now mayor of Houston, stating that
the controller’s office is “ no longer responsible for

© 2015 Thomson Reuters. No claim to original U.S. Government Works. 2Texas Ass’n of Business v. Texas Air Control Bd., 852 S.W.2d 440 (1993)

852 S.W.2d 440 Supreme Court of Texas.

TEXAS ASSOCIATION OF BUSINESS, Appellant,

v. TEXAS AIR CONTROL BOARD and Texas Water Commission, Appellees.

No. C

– 9556. | March 3, 1993. | Rehearing Overruled May 5, 1993.

Business association sought dec laratory judgment that statutes authorizing administrative agencies to assess fines
for violation of environmental laws are unconstitutional. The 250th District Court, Travis County, upheld statutes, and direct appeal was taken. The Supreme Court, Cornyn, J., held that: (1) statutes authorizing Air Control Board and Water Commission to assess fines prior to judicial review violate open courts guarantee of Texas Constitution, but (2) statutes do not violate constitutional right to jury trial.

Affirmed in p art and reversed in part.

Doggett, Gammage , and Spector, JJ., concurred, dissented, and filed opinions.

Attorneys and Law Firms

*441 R. Kinnan Golemon

, James W. Checkley, Jr.

, Albert R. Axe, Jr.

, Scott R. Kidd and Douglas W. Alexander

, Austin, for appellant.

Douglas G. Caroom

, Mary E. Kelly , Dan Morales, Nancy N. Lynch

, William D. Dugat, III and Amy R. Johnson

, Austin, for appellees.

OPINION

CORNYN, Justice.

The Texas Association of Business (TAB), on behalf of its members, brought this declaratory judgment action seeking a ruling that statutes empowering two state administrative agencies to lev y civil penalties for violations of their regulations conflict with the open courts and jury trial provisions of the Texas Constitution. The administrative agencies denied TAB’s claims, and along with two Intervenors, 1 filed counterclaims seeking a
declaration *442 that the same statutes and regulations comport with those constitutional provisions.

1 The League of Women Voters and the Lone Star Chapter of the Sierra Club intervened in the suit and were aligned as defendants with the Texas Air Control
Board and the Texas Water Commission. Justice Doggett contends that the standing of the Intervenors
sho uld be addressed along with TAB’s. We disagree. Standing concerns a party’s faculty to invoke the court’s subject matter jurisdiction. Once it has been invoked by a plaintiff, a court’s subject matter jurisdiction is not affected by the status of defendant s or intervenors aligned in interest with defendants.

Following a bench trial, the trial court denied the relief sought by TAB, and as requested by the State and Intervenors, declared that section 4.041 of the Texas Clean Air Act, sectio ns 26.136 and 27.1015 of the Texas
Water Code , and section 8b of the Texas Solid Waste Disposal Act, as well as the rules and regulations promulgated under those statutes, are constitutional with regard to the open courts and jury tr ial provisions. We affirm the trial court’s judgment as it relates to TAB’s jury trial challenge and reverse its judgment as to TAB’s open courts challenge.

An overview of the regulatory scheme enacted by the legislature and these agencies is essential t o an understanding of this case. In 1967, the Texas Legislature
enacted the Clean Air Act of Texas. Clean Air Act of Texas, 60th Leg., R.S., ch. 727, 1967 Tex.Gen.Laws 1941. The Clean Air Act was designed to safeguard the state’s air resources without comp romising the economic development of the state. Id. at § 1 . The Act created the Texas Air Control Board and granted it the authority to promulgate regulations to accomplish the Act’s goals. Id.

at § 4(A)(2)(a). In the event the Air Contro l Board determined that a violation of its regulations had occurred, it was authorized to enforce those regulations in district court. Upon a judicial determination that a violation of the Air Control Board’s regulations had occurred, two cumulative remedi es were available, injunctive relief to prohibit further violations and assessment of a fine ranging from $50 to $1,000 for each day the violations persisted. Id. at § 12(B).

In 1969, the Texas Legislature enacted the Solid Waste Disposal Act. Solid Waste Disposal Act, 61st Leg., R.S., ch. 405, 1969 Tex.Gen.Laws 1320. The express purpose for this legislation was to protect public health and welfare by regulating the “ collection , handling, storage,

© 2015 Thomson Reuters. No claim to original U.S. Government Works. 1Texas Ass’n of Business v. Texas Air Control Bd., 852 S.W.2d 440 (1993)

unconstitutional denial of a jury trial and violation of our constitution’s open courts provision.

4 “ An appeal may be taken directly to the supreme court from an order of a trial court granting or denying an interlocutory or permanent injunction on the ground of the constitutionality of a statute of this state. ” TEX.GOV’T CODE § 22.001(c)

.

I. Standing

Before we reach the merits of this case, we first consider the matter of the trial court’s jurisdiction, as well as our own; specifically we determine whether TAB has standing to challenge the statutes and regulations in question. Because TAB’s standing to bring this action is not readily apparent, and because our jurisdiction as well as that of the trial court depends on this issue, we requested supplemental briefing on standing at the oral argument of this case. In response, the parties insist that

any qu estion of standing has been waived in the trial court and cannot be raised by the court for the first time on appeal. We disagree.

[1] Subject matter jurisdiction is essential to the authority of a court to decide a case. Standing is implicit in the concept of subject matter jurisdiction. The standing requirement stems from two limitations on subject matter jurisdiction: the separation of powers doctrine and, in

Texas , the open courts provision. Subject matter jurisdiction *444 is never presumed and cannot be
waived. 5

5 Justice Doggett confuses subject matter jurisdiction with personal jurisdiction. Only the latter can be
waived when uncontested

. See TEX.R.CIV.P. 120a

.

[2] [3] One limit on courts’ jurisdic tion under both the state and federal constitutions is the separation of powers
doctrine. See TEX.CONST. art. II, § 1 ; Valley Forge Christian College v. Americans United for Separation of Church and State, 454 U.S. 464, 471

– 74, 102 S.Ct. 752,
757

– 60, 70 L.Ed.2d 700 (1982) ; Warth v. Seldin, 422 U.S. 490, 498, 95 S.Ct. 2197, 2204, 45 L.Ed.2d 343 (1975) ; see also, Antonin Scalia, The Do ctrine of Standing as an Essential Element of the Separation of Powers, 18 SUFFOLK U.L.Rev. 881, 889 n. 69 (1983) (noting that
the dicta of Flast v. Cohen, 392 U.S. 83, 100, 88 S.Ct. 1942, 1952, 20 L.Ed.2d 947 (1968) , suggesting that standing is unrelated to the separation of powers doctrine has since been disavowed). Under this doctrine, governmental authority vested in one department of
government canno t be exercised by another department unless expressly permitted by the constitution. Thus we have construed our separation of powers article to prohibit courts from issuing advisory opinions because such is the function of the executive rather than the jud icial department. 6 Firemen’s Ins. Co. v. Burch, 442 S.W.2d 331, 333 (Tex.1969) ; Morrow v. Corbin, 122 Tex. 553, 62 S.W.2d 641, 644 (Tex.1933) . Accordingly, we have interpreted the Uniform Declaratory Judgments Act, TEX.CIV.PRAC. & REM.CODE §§ 37.001

– .011, to be merely a procedural device for deciding cases already within a court’s jurisdiction rather than a legislative enlargement of a court’s power, permitting the rendition of advisory opinions. Firemen’s Ins. C o., 442 S.W.2d at 333; United Serv. Life Ins. Co. v. Delaney, 396 S.W.2d 855, 863 (Tex.1965) ; California Prods., Inc. v. Puretex
Lemon Juice, Inc., 160 Tex. 586, 334 S.W.2d 780 (1960)

.

6 The analysis is the same under the federal constitution. See e.g. Correspondence of the Justices, Letter from Chief Justice John Jay and the Associate Justices to President George Washington, August 8, 1793 in Laurence H. Tribe, American Constitutional Law 73 n. 3 (2nd ed. 1988).

[4] [5] The distinctive feature of an advisory opinion is that it decides an abstract question of law without binding the parties. Alabama State Fed’n of Labor v. McAdory, 325 U.S. 450, 461, 65 S.Ct. 1384, 1389, 89 L.Ed. 1725 (1945) ; Firemen’s Ins. Co., 442 S.W.2d at 333; Puretex Lemon Juice, Inc., 160 Tex. at 591, 334 S.W.2d at 783. An opinion issued in a case brought by a party without standing is advisory because rather than remedying an actual or imminent harm, the judgment addresses only a hypothetical injury. See Allen v. Wright, 468 U.S. 737, 751, 104 S.Ct. 3315, 3324, 82 L.Ed.2d 556 (1984) . Texas courts, like federal courts, have no jurisdiction to render such opinions.

[6] The separation of powers doctrine is not the only constitutional basis for standing. Under federal law, standing is also an aspect of the Article III limitation of the judicial power to “ cases ” and “ controversies. ” Sierra Club v. Morton, 405 U.S. 727, 731, 92 S.Ct. 1361, 1364, 31 L.Ed.2d 636 (1972) . To comport with Arti cle III, a federal court may hear a case only when the litigant has been threatened with or has sustained an injury. Valley Forge Christian College, 454 U.S. at 471, 102 S.Ct. at
758. Under the Texas Con stitution, standing is implicit in the open courts provision, which contemplates access to

© 2015 Thomson Reuters. No claim to original U.S. Government Works. 3Texas Ass’n of Business v. Texas Air Control Bd., 852 S.W.2d 440 (1993)

the courts only for those litigants suffering an injury. Specifically, the open courts provision provides:

All courts shall be open, and every person for an injury d one him, in his lands, goods, person or reputation, shall have remedy by
due course of law.

TEX. CONST. art. I, § 13 (emphasis added). Because standing is a constitutional prerequisite to maintaining a
suit unde r both federal and Texas law, we look to the more extensive jurisprudential experience of the federal courts on this subject for any guidance it may yield.

Under federal law, a lack of standing deprives a court of subject matter jurisdiction because standing is an element
of such *445 jurisdiction. Carr v. Alta Verde Indus

., 931 F.2d 1055, 1061 (5th Cir.1991) ; Simmons v. Interstate Commerce Comm’n, 900 F.2d 1023, 1026 (7th Cir.1990) ; M.A.I.N. v. Commissioner, Maine Dept. of Human Serv., 876 F.2d 1051, 1053 (1st Cir.1989) ; Haase v. Sessions, 835 F.2d 902, 908 (D.C.Cir.1987) ; Page v. Schweiker, 786 F.2d 150, 153 (3 d Cir.1986) ; see also Lujan v. Defenders of Wildlife, 504 U.S. 555, 112 S.Ct. 2130, 119 L.Ed.2d 351 (1992) ; Heckler v. Mathews, 465 U.S. 728, 737, 104 S.Ct. 1387, 1394, 79 L.Ed.2d 646 ( 1984) ; Warth, 422 U.S. at 511, 95 S.Ct. at 2211. Other states have followed this analysis in construing their own
constitutions. 7 See e.g., Prudential

–

Bache Sec., Inc. v. Commissioner of Revenue, 412 Mass. 243, 588 N.E .2d 639, 642 (1992) ; Bennett v. Board of Trustees for Univ. of N. Colorado, 782 P.2d 1214, 1216 (Colo.App.1989)

, cert. denied, 797 P.2d 748 (Colo.1990) ; Pace Constr. Co. v. Missouri Highway and Transp. Comm’n, 759 S.W.2d 272, 274 (Mo.App.1988) ; Terracor v. Utah Bd. of State Lands & Forestry, 716 P.2d 796, 798

– 99 (Utah 1986) ; State by McClure v. Sports and Health Club, Inc., 370 N.W.2d 844, 850 (Minn.1985)

, appeal dism’d, 478 U.S. 1015, 106 S.Ct. 3315, 92 L.Ed.2d 730 (1986) ; Smith v. Allstate Ins. Co., 483 A.2d 344, 346 (Me.1984) ; Ardmare Constr. Co. v. Freedman, 191 Conn. 497, 467 A.2d 674, 675 n. 4, 676

– 77 (1983) ; Horn v. County of Ventura, 24 Cal.3d 605, 156 Cal.Rptr. 718, 726, 596 P.2d 1134, 1142 (1979) ; Stewart v. Board of County Comm’rs of Big Horn County, 175 Mont. 197, 573 P.2d 184, 186, 188 (1977) ; State ex rel. Albritton v. Moore, 238 La. 728, 116 So.2d 502, 504 (1959)

.

7 Of the states listed by Justice Doggett, only Illinois, Iowa, Kentucky, New York, South Dakota, and perhaps Ohio, Pennsylvania and Washington actually treat jurisdictional standing as waivable. See 852 S.W.2d at
469. The other state cases cited deal with t he waiver of objections to join a real party in interest or to a party’s capacity to sue rather than to jurisdictional standing.

See International Depository, Inc. v. State, 603 A.2d 1119, 1122 (R.I.1992) (addressing real party in interest objection); Princess Anne Hills Civ. League, Inc. v. Susan Constant Real Estate Trust, 243 Va. 53, 413 S.E.2d 599, 603 n. 1 (1992) (addressing real party in
interes t objection); Sanford v. Jackson Mall Shopping Ctr. Co., 516 So.2d 227, 230 (Miss.1987) (addressing real party in interest objection); Jackson v. Nangle, 677 P.2d 242, 250 n. 10 (Alaska 1984) (addressing real party in interest objection); Poling v. Wisconsin Physicians Serv., 120 Wis.2d 603, 357 N.W.2d 293,
297

– 98 (App.1984) (addressing real party in interest objection); Torrez v. State Farm Mut. Auto. Ins. Co., 130 Ariz. 223, 635 P.2d 511, 513 n. 2 (App.1981) (addressing real party in interest objection); Brown v. Robinson, 354 So.2d 272, 273 (Ala.1977) ; Cowart v. City of West Palm Beach, 255 So.2d 673, 675 (Fla.1971) (addressing capacity objection).

[7] Subject matter jurisdiction is an issue that may be raised for the first time on appeal; it may not be waived by the parties. Texas Employment Comm’n v.

Int ernational Union of Elec., Radio and Mach. Workers, Local Union No. 782, 163 Tex. 135, 352 S.W.2d 252, 253 (1961) ; RESTATEMENT (SECOND) OF JUDGMENTS § 11 , comment c (1982). This court recently reiterated
that axiom in Gorman v. Life Insurance Co., 811 S.W.2d 542, 547 (Tex.)

, cert. denied, 502 U.S. 824, 112 S.Ct. 88, 116 L.Ed.2d 60 (1991) . Because we conclude that standing is a component of subject matter jurisdiction , it cannot be waived and may be raised for the first time on appeal. 8

8 Justice Doggett disagrees that standing is a component of subject matter jurisdiction, yet he declines to explain what role standing plays in our jurisprudence. From his harsh critique of the doc trine, it seems that he not only objects to the conclusion that standing cannot be waived but also to the conclusion that standing is a requirement to initiate a lawsuit.

[8] If we were to conclude that standing is unreviewable on appeal at least three undesirable consequences could result. First and foremost, appellate courts would be impotent to prevent lower courts from exceeding their
constitutional and statutory limits of authority. Second, appellate courts could not arrest collusive suits. Third, by operation of the doctrines of res judicata and collateral estoppel, judgments rendered in suits addressing only hypothetical injuries could bar relitig ation of issues by a litigant who eventually suffers an actual injury. We therefore hold that standing, as a component of subject

© 2015 Thomson Reuters. No claim to original U.S. Government Works. 4Trinity Settlement Services, LLC v. Texas State Securities Bd., 417 S.W.3d 494 (2013)

Blue Sky L. Rep. P 75,042

417 S.W.3d 494
Court o f Appeals of Texas,

Austin. TRINITY SETTLEMENT SERVICES, LLC, Appellant

v. The TEXAS STATE SECURITIES BOARD and John Morgan, in his Official Capacity as
Commissioner of the Texas State Securities Board 1 , Appellees.

1 The not ice of appeal and prior filings in the district court reference the TSSB’s former commissioner, Denise Voigt Crawford, who has since retired. Accordingly, the TSSB’s current commissioner, John Morgan, has been substituted. See Tex.R.App. P. 7.2(a)

.

No. 03

– 10

– 00639

– CV. | Aug. 1, 2013. | Rehearing Overruled Oct. 2, 2013.

Synopsis Background: Viatical settlement company s ued Texas State Securities Board (TSSB) to obtain declaratory judgment that TSSB acted without statutory authority in prior enforcement action against another viatical settlement company, and that certain investments plaintiff proposed to sell were not “ se curities ” as defined by Texas Securities Act (TSA). The 53rd Judicial District Court, Travis County, Lora Livingston , J., granted TSSB’s plea to the jurisdiction. Plaintiff appealed.

Holdings: The Court of Appeals, David Puryear , J., held
that:

[1] TSSB’s statements in prior action did not constitute rule under Administrative Procedure Act (APA) subject to challenge through declaratory judgment action;

[2] in seeking declaration that TSSB acted without statutory authority, plaintiff sought impermissible advisory opinion; and

[3] plaintiff’s requested declaration of its ri ghts and status was not ripe for review.

Affirmed. Attorneys and Law Firms

*497 Hector De Leon

, Benjamin S. De Leon

, Thomas P.
Washburn

, George B. Ward , De Leon & Washburn, P.C., Austin, TX, for Appellant.

Lesli Gattis Ginn , Assistant Attorney General, Financial Litigation, Tax, and Charitable Trusts Division, Austin, TX, for Appelle e.

Before Justices PURYEAR

, PEMBERTON , and ROSE

.

OPINION

DAVID PURYEAR , Judge.

This is an appeal from a grant of a plea to the jurisdiction stemming from a dispute regarding the Texas State Securities Board’s regulation of the sale of viatical settlements. Appellant Trinity Settlement *498 Services, LLC (Trinity), an entity proposing to engage in the sale of viatical settlements, sued appellees the Texas State Securities Board (TSSB) and John Morgan, in his official capacity as Commissioner of the T SSB, to obtain a declaratory judgment (1) that the TSSB and Morgan acted without statutory authority in an enforcement action against another viatical

- settlement provider, Retirement Value, LLC (RV) and (2) that certain investments Trinity itself proposes to sell, denominated “ specified percentages of participations in the proceeds of life insurance policies, ” are not “ securities ” as defined by the Texas Securities Act (TSA). We affirm the trial court’s order granting the plea to the jurisdiction, concludin g Trinity failed to invoke the jurisdiction of the trial court under either (1) the Administrative Procedure Act (APA)
section 2001.038 because it failed to challenge a rule of the TSSB, as defined by the APA, or (2) the Uniform
Declar atory Judgments Act (UDJA) because it failed to plead a justiciable controversy.

BACKGROUND

A. Viatical Settlements

A “ viatical settlement ” is a transaction in which an
insu red sells the benefits of his or her life insurance policy to a third party in return for a lump

- sum cash payment

© 2015 Thomson Reuters. No claim to original U.S. Government Works. 1Trinity Settlement Services, LLC v. Texas State Securities Bd., 417 S.W.3d 494 (2013)

Blue Sky L. Rep. P 75,042

its own righ ts and status under the TSA. The UDJA grants any litigant whose rights are affected by a statute the opportunity to obtain a declaration of those rights under
the statute. Tex. Civ. Prac. & Rem.Code § 37.004 ; see also Texas Mun. Power Agency v. Public Util. Comm’n., 100 S.W.3d 510, 515 (Tex.App.

- Austin 2003, pet denied)

. A declaratory

- judgment action does not, however, give a

court “ jurisdiction to pass upon hypothetical or contin gent situations, or to determine questions not then essential to the decision of an actual controversy, although such actions may in the future require adjudication. ” Bexar Metro. Water Dist. v. City of Bulverde, 234 S.W.3d 126,
130

– 31 (Tex.App.

- Austin 2007, no pet.) . After careful review of the record, we conclude any controversy between the TSSB and Trinity at this time is based upon hypothetical facts that have not yet matured to a ripe

controver sy sufficient to confer jurisdiction on the trial court. While the TSSB raises several challenges to the trial court’s jurisdiction, the ripeness issue is dispositive.

See Waco Indep. Sch. Dist. v. Gi bson, 22 S.W.3d 849, 851 (Tex.2000)

.

[25] [26] [27] Ripeness implicates subject

- matter jurisdiction
and asks whether

— at the time a lawsuit is filed

— the facts have developed sufficiently so that an injury has occ urred or is likely to occur, rather than being contingent or

remote. Rea v. State, 297 S.W.3d 379, 383 (Tex.App.

- Austin 2009, no pet.) . A case is not ripe when its resolution depends on contingent or hypothetical facts, or upon events that have not yet come to pass. *506 Patterson v. Planned Parenthood of Houston, 971 S.W.2d 439, 442 (Tex.1998) . A justicia ble controversy, however, does not necessarily equate with a fully ripened cause of
action. Moore, 985 S.W.2d at 153

– 54. Rather, an action for declaratory judgment will “ lie when the fact situation
manif ests the presence of ripening seeds of a
controversy, ” such that “ the claims of several parties are present and indicative of threatened litigation in the immediate future which seems unavoidable, even though the differences between the parties as to their legal rights have not reached the state of an actual controversy. ” Id.;

see Save our Springs Alliance v. City of Austin, 149 S.W.3d 674, 683 (Tex.App.

- Austin 2004, no pet.) The
constitutional prohibition against issuing advisory opinions also has a pragmatic, prudential aspect that aims

to conserve “ judicial time and resources for real and current controversies, rather than abstract, hypothetical, or remote disputes. ” Patterson, 971 S.W.2d at 443 (quoting Mayhew v. Town of Sunnyvale, 964 S.W.2d 922, 928 (Tex.1998) ). In the administrative

- law context, moreover, avoiding premature lit igation over administrative determinations prevents courts from “ entangling themselves in abstract disagreements over administrative policies ” while simultaneously allowing the agency to perform its functions unimpeded. Id.

[28] [29] In determining whether a cause is ripe for judicial
considerat ion, we look to whether the facts have sufficiently developed to show that an injury has occurred, or is likely to occur. City of Waco, 83 S.W.3d at
175. When a business

— like Trinity

— files a

“ pre

- enfo rcement ” suit seeking a declaration of its rights prior to an agency enforcement action, we have concluded the controversy is ripe for review only if “ an enforcement action is imminent or sufficiently likely. ” Atmos Energy Corp. v. Abbott, 127 S.W.3d 852, 856 (Tex.App.

- Austin 2004, no pet.) ; see also Rea, 297 S.W.3d at 383 ( “ To establish that a claim is ripe based on an injury that is likely to occur, the plaintiff must demonstrate that the injury is imminent, direct, and immediate, and not merely remote, conjectural, or hypothetical. ” ). In this case, the pleadings and evidence indicate the TSSB has taken no action against Trinity. 3 Although the TSSB has brought an enforcement action against other viatical settlement providers, we cannot conclude that an enforcement act ion against Trinity is also imminent or sufficiently likely to
occur at this time.

3 Trinity pleads the TSSB sent its manager, Michael McDermott, correspondence in connection with the RV
suit “ alleging Mr. McDermott may have offered for
sale and/or sold investments on behalf of RV. ” According to Trinity’s pleadings, the TSSB letter was

sen t to Mr. McDermott because of his potential connection with the RV suit and not because of any action by Trinity or action by McDermott on Trinity’s
behalf.

Rather, whether the TSSB will bring an enforcement action against Trinity depends on many factua l contingencies that have not yet come to pass and are not before the court, including whether Trinity chooses to begin selling viatical settlements, how Trinity ultimately structures its investments, the managerial efforts Trinity exerts in such sales, wh at type of investors purchase the viatical settlements, and whether the TSSB elects to bring an enforcement action against Trinity based on these future actions. Trinity’s claim does not pose a pure question of law but instead asks the trial court to engag e in a fact

- based determination based upon contingent, hypothetical facts. See Beacon Nat’l. Ins. Co. v. Montemayor, 86 S.W.3d 260, 268 (Tex.App.

- Austin 2002, no pet.) (concluding appellant’s prematur e attempt to arrest the administrative process before the agency had taken an adverse action against it was not ripe when claim
did not *507 present pure question of law but required the
determination of several factua l matters that had not sufficiently developed); see also Atmos, 127 S.W.3d at

© 2015 Thomson Reuters. No claim to original U.S. Government Works. 7TXU Elec. Co. v. Public Utility Com’n of Texas, 51 S.W.3d 275 (2001)

Util. L. Rep. P 26,789, 44 Tex. Sup. Ct. J. 854, 44 Tex. Sup. Ct. J. 1126

51 S.W.3d 275 Supreme Court of Texas.

TXU ELECTRIC COMPANY, et al., Appellants,

v. PUBLIC UTILITY COMMISSION OF TEXAS, et al., Appellees.

No. 00

– 0936. | Argued Jan. 31, 2001. | Decided June 6, 2001. | Rehearing Overruled Aug. 30, 2001.

Incumbent electric utility and intervenors appealed decision by the Public Utility Commission (PUC) on financing for recovery of utility’s regulatory assets and stranded costs during deregulation to competitive market. The 250th District Court, Travis Coun ty, reversed and remanded in part. Appeal was taken. The Supreme Court,

Owen , J., held that: (1) the PUC could employ a second present value test to determine whether tangible and quantifiable benefits to ratepayers were provided by securitization through bonds secured by transition charges; (2) the PUC was required to assume that , absent securitization, regulatory assets and stranded costs would be recovered through competition transition charges in less than forty years; (3) it was not required to use the weighted average life of six years over which utility’s
transition bonds wo uld be outstanding; (4) it lacked the discretion to consider utility’s regulatory assets on an

asset

- by

- asset basis; (5) it may apply the rate design methodology established in an utility’s last rate design case to the data in that rate case, rather than t o more current data; and (6) in an opinion by Hecht , J., the PUC was not required to reallocate overpayments or underpayments of transition charges by any one class among all customers.

Affirmed in part, reversed in part, and remanded.

Owen , J., dissented in part and filed opinion joined by
Enoch and Baker, JJ.

*275 Opinion by Justice Owen

Attorneys and Law Firms

*276 Roy Q. Minton , Minton Burton Foster & Collins, Robert J. Hearon, Jr.

, Mary A. Keeney , Graves Dougherty Hearon & Moody, Austin, Robert A. Wooldridge

, Robert
M. Fillmore

, Howard V. Fisher , Worsham Forsythe Wooldridge, Dallas, for Appellant.

*277 Thomas K. Anson , Sheinfeld Maley & Kay, Geoffrey M. Gay , Lloyd Gosselink Blevins Rochelle,

Aus tin, Alan W. Harris, Dallas, Marianne Carroll

, David

B. Gross , Carroll & Gross, Andrew Kever , Bickerstaff Heath Smiley Pollan Kever & McDaniel, Mark C. Davis

, Brickfield Burchette & Ritts, James K. Rourke

, Thomas

Lane Brocato , Suzi Ray McClellan, Office of Public Utility Counsel, Steven Baron , Office of Attorney General of Texas, John Cornyn , Attorney General of the

State o f Texas, Jeffrey S. Boyd

, Karen Watson Kornell

, Douglas Fraser, Bryan L. Baker , Office of the Attorney General, Jonathan Day

, Lino Mendiola , Mayor Day Caldwell & Keeton, Diane Barlow

– Sparkman, Mark W. Smith, J. Kay Trostle, Elizabeth H. Drews

, James G. Boyle , Law Office of Jim Boyle, Austin, for Appellee.

PER CURIAM.

In 1999, the Legislature amended the Public Utility Regulatory Act (PURA) to usher in deregulation of retail electric utility rates in Texas. 1 As part of that plan, t he Legislature concluded that, subject to certain restrictions, an existing utility like TXU Electric Company may
recover amounts that the PURA defines as “ regulatory

assets ” by using securitization financing. Securitization is accomplished through a finan cing order issued by the Commission that authorizes a utility to issue transition bonds. The transition bonds are repaid or secured by transition charges to ratepayers in a utility’s service area. TXU requested the Commission to issue a financing order

sec uritizing certain of its regulatory assets. The
Commission authorized securitization of some but not all
of those assets. A district court reversed the Commission’s order in part and remanded the case for further proceedings. TXU and others bring this dire ct appeal to our Court. 2

1 Act of May 27, 1999, 76th Leg., R.S., ch. 405, 1999
Tex. Gen. Laws 2543.

2 TEX. UTIL.CODE § 39.303(f) (providing that review of financing orders under the PURA are to be directly appealed from the district court to this Court).

We hold that: 1) in order to ensure that securitization provides tangible and quantifiable benefits to ratepayers

© 2015 Thomson Reuters. No claim to original U.S. Government Works. 1TXU Elec. Co. v. Public Utility Com’n of Texas, 51 S.W.3d 275 (2001)

Util. L. Rep. P 26,789, 44 Tex. Sup. Ct. J. 854, 44 Tex. Sup. Ct. J. 1126

V

Several parties who are also parties in Corpus Christi raise many of the same issues in both cases. 37 Our decision in CP & L resolves each of these issues, and we will not lengthen this opinion by reiterating all the reasons for our holdings. We instead briefly summarize each issue and our disposition.

37 Those parties include the Office of Public Utility Counsel, Texas Industrial Consumers, and Nucor Steel,
who filed an amicus brief with this Court in Corpus
Christi.

Certain of TXU’s customers assert that the Commission
failed to follow section 39.253 in allocating transition
costs to the *287 non

- firm industrial customer classes. They con tend that the Commission erred in applying the 150 percent demand allocator required by section 39.253(d) 38 to all the transition costs rather than first subtracting the transition costs allocated to residential customers. We hold in this case, as we do in Corpus Christi, that section 39.253 is ambiguous in this regard
and that the Commission’s construction is a reasonable
one and should be accorded deference.

38 TEX. UTIL.CODE § 39.253(d) (requiring that

“ [n]on

- firm industrial customers shall be allocated stranded costs equal to 150 percent of the amount
allocated to that class ” ).

TIEC says that in determining how much of the transition
costs sho uld be allocated to the industrial classes, the
Commission should have excluded load lost when customers switched to sources of power that exempt them from paying transition charges. 39 Again, for the reasons
we consider in Corpus Christi, we reject that argument. 40

39 See id. § 39.262(k)

.

40 51 S.W.3d at 259

– 261

.

VI [5] Several parties to this appeal, including the Commission, contend that the d istrict court erred when it held that the Commission’s Finding of Fact 113 and references to that finding in Conclusion of Law 41 and Ordering Paragraph 37 were “ advisory and superfluous to the Order and therefore [have] no res judicata effect. ”
The findin g of the Commission that is at issue concerned loss on reacquired debt.

TXU reacquired preferred stock and high

- cost debt before the maturity date of that debt by paying a premium. The
loss TXU sustained in those transactions is included in the
definitio n of regulatory assets under the PURA, and the Commission allowed TXU to include loss on reacquired debt as part of the amount securitized in the financing order. This same loss on reacquired debt is also reflected as an increase in TXU’s cost of capital, and that in turn
increases TXU’s rate of return. The Commission and others were concerned that TXU would enjoy a double recovery of its losses. Responding to that concern, the Commission concluded that loss on reacquired debt

“ should not be removed from [T XU’s] cost

- of

- capital calculation for purposes of the annual report submitted
pursuant to PURA § 39.257

, ” but that instead an adjustment should be made in future proceedings. 41 In the Financing Order, Finding of Fact 113, the Commission
said that:

41 Tex. Pub. Util. Comm’n, Application of TXU Electric Company for Financing Order to Securitize Regulatory Assets and Other Qualified Costs, Docket No. 21527 (May 2, 2000).

[A]n adjustment shoul d be made in the true up proceeding under PURA § 39.262 to account for the effect of securitizing the loss on reacquired debt on [TXU’s] cost of capital. This treatment is necessary to comply with the Legislature’s mandate in PURA § 39.262(a) that a utility and its affiliates “ may not be permitted to overrecover stranded costs ” by using any of the methods provided in Chapter 39 [ § 39.262(a) ]. In addition, any determinations regarding the effect of

s ecuritizing loss on reacquired debt on the calculation
of stranded costs should not be made in this docket but should be made in [TXU’s] cost unbundling case under PURA § 39.201

. 42

42 Id. (footnote omitted).

We agree with the district court that this was an advisory and premature finding. *288 Whether an adjustment is required in a true

- up or other future proceeding should

© 2015 Thomson Reuters. No claim to original U.S. Government Works. 10§ 1.1409 Commission consideration of the complaint., 47 C.F.R. § 1.1409

Code of Federal Regulations

Title 47. Telecommunication Chapter I. Federal Communications Commission (Refs & Annos)

Subchapter A. General

Part 1. Practice and Procedure (Refs & Annos) Subpart J. Pole Attachment Complaint Procedures (Refs & Annos)

47 C.F.R. § 1.1409

§ 1.1409 Commission consideration of the complaint.

Effective: June 8, 2011

Currentness

(a) In its consideration of the complaint, response, and reply, the Commission may take notice of any information contained in publicly available filings made by the parties and may accept, subject to rebuttal, studies that have been conducted. The Commission may also request that one or more of the parties make additional filings or provide additional information. Where one of the parties has failed to provide information required to be provided by these rules or requested by the Commission, or where costs, values or amounts are disputed, the Commission may estimate such costs, values or amounts it considers reasonable, or may decide adversely to a party who has failed to supply requested information which is readily available to it, or both.

(b) The complainant shall have the burden of establishing a prima facie case that the rate, term, or condition is not just an d
reasonable or that the denial of access violates 47 U.S.C. § 224(f) . If, however, a utility argues that the proposed rate is lower than its incremental costs, the utility has the burden of establishing that such rate is below the statutory minimum just and
reasonable rate. In a case invo lving a denial of access, the utility shall have the burden of proving that the denial was lawful, once a prima facie case is established by the complainant.

(c) The Commission shall determine whether the rate, term or condition complained of is just and reasonable. For the purposes of this paragraph, a rate is just and reasonable if it assures a utility the recovery of not less than the additional costs of providing pole attachments, nor more than an amount determined by multiplying the percentage of the total usable space, or the percentage of the total duct or conduit capacity, which is occupied by the pole attachment by the sum of the operating expenses and actual capital costs of the utility attributable to the entire pole, duct, conduit, or right

- of

- way.

(d) The Commission shall deny the complaint if it determines that the complainant has not established a prima facie case, or that the rate, term or condition is just and reasonable, or that the denial of access was lawful.

(e) When parties fail to resolve a dispute regarding charges for pole attachments and the Commission’s complaint procedures
under Section 1.1404 ar e invoked, the Commission will apply the following formulas for determining a maximum just and
reasonable rate:

© 2015 Thomson Reuters. No claim to original U.S. Government Works. 1§ 1.1409 Commission consideration of the complaint., 47 C.F.R. § 1.1409

(1) The following formula shall apply to attachments to poles by cable operators providing cable services. This formula shall also apply to attachments to poles by any telecommunications carrier (to the extent such carrier is not a party to a pole attachment agreement) or cable operator providing telecommunications services until February 8, 2001:

(2) With respect to attachments to poles by any telecommunications carrier or cable operator providing telecommunications services, the maximum just and reasonable rate shall be the higher of the rate yielded by paragraphs (e)(2)(i) or (e)(2)(ii) of this section.

(i) The following formula applies to the extent that it yields a rate higher than that yielded by the applicable formula in

paragrap h 1.1409(e)(2)(ii) of this section:

Rate = Space Factor x Cost

Where Cost

in Urbanized Service Areas = 0.66 x (Net Cost of a Bare Pole x Carrying Charge Rate)

in Non

– Urbanized Service Areas = 0.44 x (Net Cost of a Bare Pole x Carrying Charge Rate).

(ii) The following formula applies to the extent that it yields a rate higher t han that yielded by the applicable formula in paragraph 1.1409(e)(2)(i) of this section:

© 2015 Thomson Reuters. No claim to original U.S. Government Works. 2§ 1.1409 Commission consideration of the complaint., 47 C.F.R. § 1.1409

(3) The following formula shall apply to attachments to conduit by cable operators and telecommunications carriers:

simplified as:

If no inner

- duct is installed the fraction, “ 1 Duct divided by the No. of Inner

– Ducts ” is presumed to be 1⁄2

.

(f) Paragraph (e)(2) of this section shall become effective February 8, 2001 (i.e., five years after the effective date of th e Telecommunications Act of 1996). Any increase in the rates for pole attachments that re sults from the adoption of such regulations shall be phased in over a period of five years beginning on the effective date of such regulations in equal annua l
increments. The five

- year phase

- in is to apply to rate increases only. Rate reductions are to be implemented immediately. The determination of any rate increase shall be based on data currently available at the time of the calculation of the rate incr ease.

Credits

[ 52 FR 31770 , Aug. 24, 1987; 61 FR 43025 , Aug. 20, 1996; 61 FR 45619 , Aug. 29, 1996; 63 FR 12025 , March 12, 1998; 65

FR 31282 , May 17, 2000; 66 FR 34580 , June 29, 2001; 76 FR 26639 , May 9, 2011]

SOURCE: 43 FR 36094 , Aug. 15, 1978; 56 FR 57598 , Nov. 13, 1991; 57 FR 187 , Jan. 3, 1992; 58 FR 27473 , May 10, 1993;
59 FR 22985 , May 4, 1994; 61 FR 45618 , Aug. 29, 1996; 61 FR 46561 , Sept. 4, 1996; 61 FR 52899 , Oct. 9, 1996; 62 FR

37422 , July 11, 1997; 63 FR 67429 , Dec. 7, 1998; 63 FR 71036 , Dec. 23, 1998; 64 FR 63251 , Nov. 19, 1999; 65 FR 10720

, Feb. 29, 2000; 65 FR 19684 , April 12, 2000; 65 FR 31281 , May 17, 2000; 69 FR 77938 , Dec. 29, 2004; 71 FR 26251 , May 4, 2006; 74 FR 39227 , Aug. 6, 2009; 75 FR 9797 , March 4, 2010; 76 FR 43203 , July 20, 2011; 77 FR 71137 , Nov. 29, 2012; 78

FR 10100 , Feb. 13, 2013; 78 FR 15622 , March 12, 2013; 78 FR 41321 , July 10, 2013; 78 FR 50254 , Aug. 16, 2013;§ 1.1409 Commission consideration of the complaint., 47 C.F.R. § 1.1409

48528 , Aug. 15, 2014; 80 FR 126 8 , Jan. 8, 2015, unless otherwise noted.

AUTHORITY: 15 U.S.C. 79, et seq. ; 47 U.S.C. 151

, 154(i)

, 154(j)

, 155

, 157

, 160

, 201

, 225

, 227

, 303

, 309

, 332

, 1403

, 1404

, 1451

, 1452 , and 1455

.

Notes of Decisions (23)

Current through April 30, 2015; 80 FR 24774.

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

© 2015 Thomson Reuters. No claim to original U.S. Government Works. 4§ 37.001. Definition, TX CIV PRAC & REM § 37.001

Vernon’s Texas Statutes and Codes Annotated

Civil Practice and Remedies Code (Refs & Annos)

Title 2. Trial, Judgment, and Appeal Subtitle C. Judgments Chapter 37. Declaratory Judgments (Refs & Annos)

V.T.C.A., Civil Practice & Remedies Code § 37.001

§ 37.001. Definition

Currentness

In this chapter, “ person ” means an individual, partnership, joint

- stock company, unincorporated association or society, or municipal or other corporation of any character.

Credits

Acts 1985, 69th Leg., ch. 959, § 1, eff. Sept. 1, 1985.

Notes of Decisions (56)

V. T. C. A., Civil Practice & Remedies Code § 37.0 01, TX CIV PRAC & REM § 37.001 Current through the end of the 2013 Third Called Session of the 83rd Legislature

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

© 2015 Thomson Reuters. No claim to original U.S. Government Works. 1§ 37.002. Short Title, Construction, Interpretation, TX CIV PRAC & REM § 37.002

Vernon’s Texas Statutes and Codes Annotated

Civil Practice and Remedies Code (Refs & Annos)

Title 2. Trial, Judgment, and Appeal Subtitle C. Judgments Chapter 37. Declaratory Judgments (Refs & Annos)

V.T.C.A., Civil Practice & Remedies Code § 37.002

§ 37.002. Short Title, Construction, Interp retation

Currentness

(a) This chapter may be cited as the Uniform Declaratory Judgments Act.

(b) This chapter is remedial; its purpose is to settle and to afford relief from uncertainty and insecurity with respect to rights, status, and other legal relations; and it is to be liberally construed and administered.

(c) This chapter shall be so interpreted and construed as to effectuate its general purpose to make uniform the law of those states that enact it and to harmonize, as far as possible, with federal laws and regulations on the subject of declaratory judgments and decrees.

Credits

Acts 1985, 69th Leg., ch. 959, § 1, ef f. Sept. 1, 1985.

Notes of Decisions (238)

V. T. C. A., Civil Practice & Remedies Code § 37.002, TX CIV PRAC & REM § 37.002 Current through the end of the 2013 Th ird Called Session of the 83rd Legislature

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

© 2015 Thomson Reuters. No claim to original U.S. Government Works. 1§ 37.003. Power of Courts to Render Judgment; Form and Effect, TX CIV PRAC & REM...

Vernon’s Texas Statutes and Codes Annotated

Civil Practice and Remedies Code (Refs & Annos)

Title 2. Trial, Judgment, and Appeal Subtitle C. Judgments Chapter 37. Declaratory Judgments (Refs & Annos)

V.T.C.A., Civil Practice & Remedies Code § 37.003

§ 37.003. Power of Courts to Render Judgmen t; Form and Effect

Currentness

(a) A court of record within its jurisdiction has power to declare rights, status, and other legal relations whether or not f urther relief is or could be claimed. An action or proceeding is not open to objection on the ground that a declaratory judgment or decree is prayed for.

(b) The declaration may be either affirmative or negative in form and effect, and the declaration has the force and effect of a final judgment or decree.

(c) The enumerations in Sections 37.00 4 and 37.005 do not limit or restrict the exercise of the general powers conferred in this section in any proceeding in which declaratory relief is sought and a judgment or decree will terminate the controversy or remove an uncertainty.

Credits

Acts 1985, 69th Leg., ch. 959, § 1, eff. Sept. 1, 1985.

Notes of Decisions (284)

V. T. C. A., Civil Practice & Remedies Code § 37.003, TX CIV PRAC & REM § 37.003 Current through the end of the 2013 Third Called Session of the 83rd Legislature

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

© 2015 Thomson Reuters. No claim to original U.S. Government Works. 1§ 37.004. Subject Matter of Relief, TX CIV PRAC & REM § 37.004

Vernon’s Texas Statutes and Codes Annotated

Civil Practice and Remedies Code (Refs & Annos)

Title 2. Trial, Judgment, and Appeal Subtitle C. Judgments Chapter 37. Declaratory Judgments (Refs & Annos)

V.T.C.A., Civil Practice & Remedies Code § 37.004

§ 37.004. Subject Matter of Relief

Effective: June 15, 2007

Currentness

(a) A person interested under a deed, will, written contract, or other writings constituting a contract or whose rights, stat us, or

o ther legal relations are affected by a statute, municipal ordinance, contract, or franchise may have determined any question of construction or validity arising under the instrument, statute, ordinance, contract, or franchise and obtain a declaration of

ri ghts, status, or other legal relations thereunder.

(b) A contract may be construed either before or after there has been a breach.

(c) Notwithstanding Section 22.001, Property Code , a person described by Subsection (a) may obtain a determination under
th is chapter when the sole issue concerning title to real property is the determination of the proper boundary line between adjoining properties.

Credits

Acts 1985, 69th Leg., ch. 959, § 1, eff. Sept. 1, 1985. Amended by Acts 2007, 80th Leg., ch. 305, § 1, eff. June 15, 2007

.

Notes of Decisions (469)

V. T. C. A., Civil Practice & Remedies Code § 37.004, TX CIV PRAC & REM § 37.004 Current through the end of the 2013 Third Called Session of the 83rd Legislature

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

© 2015 Thomson Reuters. No claim to original U.S. Government Works. 1§ 37.005. Declarations Relating to Trust or Estate, TX CIV PRAC & REM § 37.005

Vernon’s Texas Statutes and Codes Annotated

Civil Practice and Remedies Code (Refs & Annos)

Title 2. Trial, Judgment, and Appeal Subtitle C. Judgments Chapter 37. Declaratory Judgments (Refs & Annos)

V.T.C.A., Civ il Practice & Remedies Code § 37.005

§ 37.005. Declarations Relating to Trust or Estate

Currentness

A person interested as or through an executor or administrator, including an independent executor or administrator, a trustee

, guardian, other fiduciary, creditor, devisee, legatee, heir, next of kin, or cestui que trust in the administration of a trus t or of the estate of a decedent, an infant, mentally incapacitated person, or insolvent may have a declaration of rights or legal relations in respect to the trust or estate:

(1) to ascertain any class of creditors, devisees, legatees, heirs, next of kin, or others;

(2) to direct the executors, administrators, or trustees to do or abstain from doing any particular act in their fiduciary capacity;

(3) to determine any question arising in the administration of the trust or estate, including questions of construction of wi lls and other writings; or

(4) to determine rights or legal relations of an independent executor or independent administrator regarding fiduciary fees and the settling of accounts.

Credits

Acts 1985, 69th Leg., ch. 959, § 1, eff. Sept. 1, 1985. Amended by Acts 1987, 70th Leg., ch. 167, § 3.08(a), eff. Sept. 1,
1987 ; Acts 1999, 76th Leg., ch. 855, § 10, eff. Sept. 1, 1999

.

Notes of Decisions (50)

V. T. C. A., Civil Practice & Remedies Code § 37.005, TX CIV PRAC & REM § 37.005

© 2015 Thomson Reuters. No claim to original U.S. Government Works. 1§ 37.005. Declarations Relating to Trust or Estate, TX CIV PRAC & REM § 37.005

Current through the end of the 2013 Third Called Session of the 83rd Legislature

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

© 2015 Thomson Reuters. No claim to original U.S. Government Works. 2§ 37.0055. Declarations Relating to Liability for Sales and..., TX CIV PRAC & REM...

Vernon’s Texas Statutes and Codes Annotated

Civil Practice and Remedies Code (Refs & Annos)

Title 2. Trial, Judgment, and Appeal Subtitle C. Judgments Chapter 37. Declaratory Judgments (Refs & Annos)

V.T.C.A., Civil Practice & Remedies Code § 37.0055

§ 37.0055. Declarations Relating to Liabi lity for Sales and Use Taxes of Another State

Effective: September 1, 2007

Currentness

(a) In this section, “ state ” includes any political subdivision of that state.

(b) A district court has original jurisdiction of a proceeding seeking a declaratory judgment that involves:

(1) a party seeking declaratory relief that is a business that is:

(A) organized under the laws of this state or is otherwise owned by a resident of this state; or

(B) a retailer registered with the comptroller under Section 151.106, Tax Code ; and

(2) a responding party that:

(A) is an official of another state; and

(B) asserts a claim that the party seeking declaratory relief is required to collect sales or use taxes for that state based on conduct of the business that occurs in whole or in part within this state.

(c) A business described by Subsection (b)(1) is entitled to declaratory relief on the issue of whether the requirement of
another state that the busin ess collect and remit sales or use taxes to that state constitutes an undue burden on interstate commerce under Section 8, Article I, United States Constitution.

© 2015 Thomson Reuters. No claim to original U.S. Government Works. 1§ 37.0055. Declarations Relating to Liability for Sales and..., TX CIV PRAC & REM...

(d) In determining whether to grant declaratory relief to a business under this section, a court shall consider:

(1) the factual circumstances of the business’s operations that give rise to the demand by the other state; and

(2) th e decisions of other courts interpreting Section 8, Article I, United States Constitution.

Credits

Added by Acts 2007, 80th Leg., ch. 699, § 1, eff. Sept. 1, 2007

.

V. T. C. A., Civil Practice & Remedies Code § 37.0055, TX CIV PRAC & REM § 37.0 055 Current through the end of the 2013 Third Called Session of the 83rd Legislature

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

© 2015 Thomson Reuters. No claim to original U.S. Government Works. 2§ 37.006. Parties, TX CIV PRAC & REM § 37.006

Vernon’s Texas Statutes and Codes Annotated

Civil Practice and Remedies Code (Refs & Annos)

Title 2. Trial, Judgment, and Appeal Subtitle C. Judgments Chapter 37. Declaratory Judgments (Refs & Annos)

V.T.C.A., Civil Practice & Remedies Code § 37.006

§ 37.006. Parties

Currentness

(a) When declaratory relief is sought, all persons who have or claim any interest that would be affected by the declaration must be made parties. A declaration does not prejudice the rights of a person not a party to the proceeding.

(b) In any proceeding that involves the validity of a municipal ordinance or franchise, the municipality must be made a party and is entitled to be heard, and if the statute, ordinance, or franchise is alleged to be unconstitutional, the attorney general of the state must also be served with a copy of the proceeding and is entitled to be heard.

Credits

Acts 1985, 69th Leg., ch. 959, § 1, eff. Sept. 1, 1985.

Notes of Decisions (188)

V. T. C. A., C ivil Practice & Remedies Code § 37.006, TX CIV PRAC & REM § 37.006 Current through the end of the 2013 Third Called Session of the 83rd Legislature

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

© 2015 Thomson Reuters. No claim to original U.S. Government Works. 1§ 37.007. Jury Trial, TX CIV PRAC & REM § 37.007

Vernon’s Texas Statutes and Codes Annotated

Civil Practice and Remedies Code (Refs & Annos)

Title 2. Trial, Judgment, and Appeal Subtitle C. Judgments Chapter 37. Declaratory Judgments (Refs & Annos)

V.T.C.A., Civil Practice & Remedies Code § 37.007

§ 37.007. Jury Trial

Currentness

If a proceeding under this chapter involves the determination of an issue of fact, the issue may be tried and determined in t he same manner as issues of fact are tried and determined in other civil actions in the court in which the proceeding is pending

.

Credits

Acts 1985, 69th Leg., ch. 959, § 1, eff. Sept. 1, 1985.

Notes of Decisions (11)

V. T. C. A., Civil Practice & Remedies Code § 37.007, TX CIV PRAC & REM § 37.007 Current through the end of the 2013 Third Called Session of the 83rd Legislature

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

© 2015 Thomson Reuters. No claim to original U.S. Government Works. 1§ 37.008. Court Refusal to Render, TX CIV PRAC & REM § 37.008

Vernon’s Texas Statutes and Codes Annotated

Civil Practice and Remedies Code (Refs & Annos)

Title 2. Trial, Judgment, and Appeal Subtitle C. Judgments Chapter 37. Declaratory Judgments (Refs & Annos)

V.T.C.A., Civil Practice & Remedies Code § 37.008

§ 37.008. Court Refusal to Render

Currentness

The court may refuse to render or enter a declaratory judgment or decree if the judgment or decree would not terminate the uncertainty or controversy giving rise to the proceeding.

Credits

Acts 1985, 69th Leg., ch. 959, § 1, eff. Sept. 1, 1985.

Notes of Decisions (25)

V. T. C. A., Civil Practice & Remedies Code § 37.008, TX CIV PRAC & REM § 37.008 Current through the end of the 2013 Third Called Session of the 83rd Legislature

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

© 2015 Thomson Reuters. No claim to original U.S. Government Works. 1§ 37.009. Costs, TX CIV PRAC & REM § 37.009

Vernon’s Texas Statutes and Codes Annotated

Civil Practice and Remedies Code (Refs & Annos)

Title 2. Trial, Judgment, and Appeal Subtitle C. Judgments Chapter 37. Declaratory Judgments (Refs & Annos)

V.T.C.A., Civil Practice & Remedies Code § 37.009

§ 37.009. Costs

Currentness

In any proceeding under this chapter, the court may award costs and reasonable and necessary attorney’s fees as are equitable and just.

Credits

Acts 1985, 69th Leg., ch. 959, § 1, eff. Sept. 1, 1985.

Notes of Decisions (703)

V. T. C. A., Civil Practice & Remedies Code § 37.009, TX CIV PRAC & REM § 37.009 Current through the end of the 2013 Third Called Session of the 83rd Legislature

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

© 2015 Thomson Reuters. No claim to original U.S. Government Works. 1§ 37.010. Review, TX CIV PRAC & REM § 37.010

Vernon’s Texas Statutes and Codes Annotated

Civil Practice and Remedies Code (Refs & Annos)

Title 2. Trial, Judgment, and Appeal Subtitle C. Judgments Chapter 37. Declaratory Judgments (Refs & Annos)

V.T.C.A., Civil Practice & Remedies Code § 37.010

§ 37.010. Review

Currentness

All orders, judgments, and decrees under this chapter may be reviewed as other orders, judgments, and decrees.

Credits

Acts 1985, 69th Leg., ch. 959, § 1, eff. Sept. 1, 1985.

Notes of Decisions (64)

V. T. C. A., Civil Practice & Remedies Code § 37.010, TX CIV PRAC & REM § 37.010 Current through the end of the 2013 Third Called Session of the 83rd Legislature

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

© 2015 Thomson Reuters. No claim to original U.S. Government Works. 1§ 37.011. Supplemental Relief, TX CIV PRAC & REM § 37.011

Vernon’s Texas Statutes and Codes Annotated

Civil Practice and Remedies Code (Refs & Annos)

Title 2. Trial, Judgment, and Appeal Subtitle C. Judgments Chapter 37. Declaratory Judgments (Refs & Annos)

V.T.C.A., Civil Practice & Remedies Code § 37.011

§ 37.011. Supplemental Relief

Currentness

Further relief based on a declaratory judgment or decree may be granted whenever necessary or proper. The application must be by petition to a court having jurisdiction to grant the relief. If the application is deemed sufficient, the court shall, on

reaso nable notice, require any adverse party whose rights have been adjudicated by the declaratory judgment or decree to show cause why further relief should not be granted forthwith.

Credits

Acts 1985, 69th Leg., ch. 959, § 1, eff. Sept. 1, 1985.

Notes of Decisions (23)

V. T. C. A., Civil Practice & Remedies Code § 37.011, TX CIV PRAC & REM § 37.011 Current through the end of the 2013 Third Called Session of the 83rd Legislature

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

© 2015 Thomson Reuters. No claim to original U.S. Government Works. 1§ 54.205. Municipality’s Right to Control Access, TX UTIL § 54.205

Vernon’s Texas Statutes and Codes Annotated

Utilities Code (Refs & Annos)

Title 2. Public Utility Regulatory Act

Subtitle C. Telecommunications Utilities Chapter 54. Certificates (Refs & Annos)

Subchapter E. Municipalities

V.T.C.A., Utilities Code § 54.205

§ 54.205. Municipality’s Right to Control Access

Currentness

This title does not restrict a municipality’s historical right to control and receive reasonable compensation for access to t he municipality’s public streets, alleys, or rights

- of

- way or to other public property.

Cr edits

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

.

Editors’ Notes

REVISOR’S NOTE

2007 Main Volume

Section 3.2555(f), V.A.C.S. Article 1446c

- 0 , provides that the law does not “ restrict or limit ” certain municipal rights. The revised law omits the term “ limit ” because “ limit ” is included within the meaning of the term

“ restrict. ”

Notes of Decisions (3)

V. T. C. A., Utilities Code § 54.205, TX UTIL § 54.205 Current through the end of the 2013 Third Called Session of the 83rd Legislature

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

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