UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF TEXAS

DALLAS DIVISION

DUKE LEVY, §

§

Plaintiff/Counter-Defendant, §

§

V. §

§

CITY OF RIO GRANDE CITY, a Texas §

Municipal Corporation, §

§ CIVIL ACTION NO. 3: 04-CV-0381-B

Defendant/Counter-Plaintiff/ §

Cross-Plaintiff, §

§

V. §

§

DUKE LEVY, L.L.C. and DLA §

ENGINEERING GROUP, LTD. §

§

Cross-Defendants. §

MEMORANDUM ORDER

Before the Court is Defendant City of Rio Grande City’s (the “City”) Objection to Amended

Scheduling Order and Opposed Motion for Leave to Amend Answer and Move for Partial Summary

Judgment (“Motion for Leave”) (doc. 156). For the following reasons, theCourt DENIES the City’s

motion to amend its answer and to file a second summary judgment motion, but it will permit the

City to file a Rule 12(b)(1) motion to dismiss for lack of subject matter jurisdiction based on the

defense of governmental immunity from suit.

Plaintiff Duke Levy filed this action in this Court on February 20, 2004. He claims that he

is an assignee to a contract that the City had with Kyle Engineering, Inc. (“KEI”) for the performance

of various engineering services and that, as assignee, he is entitled to receive certain payments

allegedly owing for work KEI performed under the contract. In his live pleading Levy asserts claims

 

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against the City for breach of contract, sworn account, and quantum meruit. The parties filed cross

motions for summary judgment, which were referred to Magistrate Judge Jeff Kaplan for

recommendation. On September 15, 2006, Magistrate Judge Kaplan denied Levy’s motion and

granted the City’s motion in part. Specifically, the Magistrate Judge recommended that the City’s

motion be granted with respect to Levy’s quantum meruit and sworn account claims. On September

29, 2006, this Court accepted the Magistrate Judge’s findings and recommendation. Thus, Levy’s

only remaining affirmative claim against the City is for breach of contract. On November 15, 2006,

the Court entered an Amended Scheduling Order setting this case for trial on a four-week docket

starting February 5, 2007.

The City now seeks to postpone the trial setting for two reasons. First, it states that its

counsel has a preferential two-week trial setting in late January 2007. And second, it claims to need

additional time to amend its answer and file a second summary judgment motion based on the

defense of sovereign or governmental immunity. (See Mot. for Leave at 1-2). The City also seeks

leave to amend its answer to assert governmental immunity as an affirmative defense and to file an

additional motion for summary judgment on that defense. Levy does not oppose a thirty-day

postponement of the trial setting to accommodate the trial conflict of opposing counsel, but he

adamantly opposes the City’s request to amend its answer and file yet another summary judgment

motion.

The City’s Motion for Leave is thinly supported and fails to make any serious attempt to meet

Rule 16(b)’s “good cause” requirement for the extension of the deadlines for trial, the amendment

of pleadings, and the filing of dispositive motions. Instead the City simply states that “good cause”

exists for the sought-after extensions because “the Texas Supreme Court has recently handed down

 

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The Texas Supreme Court has clarified that the term “sovereign immunity” refers to immunity from 1

suit of the State and its various divisions, including agencies, boards, hospitals, and universities. See Wichita

Falls State Hosp. v. Taylor, 106 S.W.3d 692, 694 n.3 (Tex. 2003). “Governmental immunity”, on the other

hand, refers to the immunity of political subdivisions of the State, including counties, cities, and school

districts. Id. 

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a series of significant opinions regarding the affirmative defense of sovereign and governmental

immunity”, citing to Tooke v. City of Mexia, 197 S.W.3d 325 (Tex. 2006) and Reata Constr. Corp. v.

City of Dallas, 197 S.W.3d 371 (Tex. 2006). That may be so, but other than characterizing such

opinions as “recent and extremely important” (Mot. for Leave at 2), the City fails to explain their

legal significance to this case.

Despite the deficiencies in the City’s Motion for Leave, it is clear that the City believes it is

entitled to assert the defense of sovereign or governmental immunity as to Levy’s breach of contract 1

claim. “It is well established that sovereign immunity from suit protects the State of Texas, its

agencies, and its officials from lawsuits for damages unless it is waived by clear and unambiguous

consent to suit.” City of Dallas v. Albert, – S.W.3d – , 2006 WL 3742888, at *2 (Tex. App. – Dallas,

Dec. 21, 2006). A city is considered a state agent for sovereign immunity purposes when it exercises

its powers for public purposes. Id. In Texas, governmental immunity takes two forms: immunity

from liability and immunity from suit. See Tooke, 197 S.W.3d at 332; Gen. Servs. Comm’n v. LittleTex Insulation Co., Inc., 39 S.W.3d 591, 594 (Tex. 2001). Immunity from liability is an affirmative

defense that bars the enforcement of a judgment against a governmental entity. Tooke, 197 S.W.3d

at 332; Texas Dep’t of Transp. v. Jones, 8 S.W.3d 636, 638 (Tex. 1999). The defense must be

pleaded, else it is waived. See id. A governmental entity waives immunity from liability when it

enters into a contract. Tooke, 197 S.W.3d at 332; Little-Tex, 39 S.W.3d at 594. 

 

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Immunity from suit, on the other hand, bars altogether an action against a governmental

entity unless consent to suit has been granted. See Tooke, 197 S.W.3d at 332; Jones, 8 S.W.3d at

638. Immunity from suit is not waived simply because the government enters into a contract with

a private person or entity. See Little-Tex, 39 S.W.3d at 594. Express consent for suit must come from

the Texas legislature. Id. Absent legislative consent, the trial court lacks subject matter jurisdiction.

See Jones, 8 S.W.3d at 638. 

In this case Levy asserts entitlement to damages arising out of the City’s alleged breach of a

contract it had with KEI. As the City admits that it entered into a contract with KEI (Def.’s Am.

Answer at ¶¶ 8-9), a private entity, it has waived immunity from liability, and it would be futile for

the City to amend its answer to assert such a defense. Tooke, 197 S.W.3d at 332 (“By entering into

a contract, a governmental entity necessarily waives immunity from liability, voluntarily binding itself

like any other party to the terms of agreement[.]”). With respect to immunity from suit, a pleading

amendment is not necessary. The question of a governmental entity’simmunity from suit implicates

this Court’s subject matter jurisdiction, which may be challenged at any time. See Kontrick v. Ryan,

540 U.S. 443, 455 (2004); Sivley v. Sivley, 972 S.W.2d 850, 855 (Tex. App. – Tyler 1998, no pet.);

5C CHARLES ALAN WRIGHT &ARTHUR R.MILLER,FEDERAL PRACTICE AND PROCEDURE § 1361 (3d

ed. 2004); see also FED. R. CIV. P. 12(h)(3) (“Whenever it appears by suggestion of the parties or

otherwise that the court lacks jurisdiction of the subject matter, the court shall dismiss the action.”).

This leaves the matter of the appropriate procedural vehicle through which the City may raise

immunity from suit as a defense. The City seeks to do so via summary judgment. That mechanism

is unavailable to the City, however, as it has already exhausted the one summary judgment permitted

by the local rules of this district. See N.D.TEX. LOCAL RULE 56.2(b). If this were a Texas court, the

 

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appropriate device would be a plea to the jurisdiction. Jones, 8 S.W.3d at 638-39. The nearest

federal analog to such a plea is a Rule 12(b)(1) motion for lack of jurisdiction over the subject

matter. See FED. R. CIV. P. 12(b)(1). Accordingly, the Court will permit the City to contest the

subject matter jurisdiction of this Court by filing a Rule 12(b)(1) motion. If the City chooses to file

such a motion, it is directed to specifically: 1) provide a basis for the City’s assertion of governmental

immunity from suit; 2) address whether the City has waived (or even can waive) immunity from suit

by its conduct (e.g. by actively litigating this case or by asserting counterclaims); and 3) address

whether the City’simmunity from suit with respect to a claim for breach of contract has been waived

by § 271.152, or any other section, of the Texas Local Government Code. 

For the foregoing reasons, the Court DENIES the City’s motion for leave to file an amended

answer and to file an additional motion for partialsummary judgment. TheCourt will allow the City

until January 12, 2007 to file a motion to dismiss for lack of subject matter jurisdiction under Rule

12(b)(1), Federal Rules of Civil Procedure. If the City elects to file such a motion, Levy shall have

until January 26, 2007 to file a response. The Court VACATES the February 5, 2007 trial setting

in this case. Trial is re-set for March 5, 2007, and the pretrial conference is rescheduled for March

2, 2007 at 10:00 a.m. All other pretrial deadlines set forth in the Court’s November 15, 2006

Amended Scheduling Order remain in effect.

SO ORDERED.

Signed December 28 , 2006 th

_________________________________

JANE J. BOYLE

UNITED STATES DISTRICT JUDGE

 

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