Opinion ID: 895305
Heading Depth: 3
Heading Rank: 3

Heading: City Ordinances as Unilateral Contract Under Section 271.151(2)

Text: Guided by these principles, we turn to the particular Ordinances at issue to determine if they constitute a unilateral employment contract between the City and the Firefighters within section 271.152’s waiver of immunity. As discussed above, in order to determine if the Ordinances can collectively constitute a contract to which section 271.152 applies, we must determine whether five elements are met: (1) the contract must be in writing, (2) state the essential terms of the agreement, (3) provide for goods or services, (4) to the local governmental entity, and (5) be properly executed on behalf of the local governmental entity. Tex. Loc. Gov’t Code § 271.151(2). Because the Ordinances at issue here meet each of these five elements, we conclude the Ordinances collectively constitute a unilateral employment contract between the City and the Firefighters, thereby meeting the third requirement of section 271.152’s waiver of immunity. First, the Ordinances comprise a contract, and that contract is in writing. “A promise, acceptance of which will form a contract, ‘is a manifestation of intention to act or refrain from acting in a specified way, so made as to justify a promisee in understanding that a commitment has been made.’” Montgomery Cnty. Hosp. Dist. v. Brown , 965 S.W.2d 501, 502 (Tex. 1998) (quoting Restatement (Second) of Contracts § 2(1)). The City manifested its intention to act in a specific way in the Ordinances by its extensive use of the word “shall” 1 0 and similar provisions that make the benefits offered to the Firefighters mandatory upon performance. The Ordinances are authored by the City, and are addressed to a discrete group of offerees: those persons qualifying as “eligible employees,” who are defined as “all classified members of the fire department.” Houston, Tex., Code of Ordinances ch. 34, art. III, § 34-59(a)(2). As such, the Ordinances constitute an offer that was communicated to the Firefighters, see Restatement of Contracts § 22, which the Firefighters accepted by performing, see Vanegas , 302 S.W.3d at 303. The City’s Ordinances further promised the Firefighters specific compensation in the form of overtime pay and termination pay. That promise required acceptance by performance, making the promise a unilateral contract that became binding when the Firefighters performed. See id. The performance the City requested is detailed in parts of Chapter 34, Article III, 1 1 of the Houston Code of Ordinances. See Houston, Tex., Code of Ordinances ch. 34, art. III, §§ 34-46, 34-48, 34-50. Those sections describe the duties of the Firefighters generally, id. § 34-46, and of the three particular divisions of the fire department: fire prevention, id. §§ 34-48, 34-50(d), fire suppression, id. § 34-50(b), and fire alarm, id. § 34-50(c). These duties include valuable services such as “extinguishing fires and conflagrations and preventing loss of human life and property,” id. § 34-50(b), “operating the fire alarm system,” id. § 34-50(c), and “conducting inspections, reviewing plans for construction and conducting public information campaigns to reduce the loss of life and property by fire,” id. § 34-50(d). The Firefighters each performed such services for various periods of time, rendering the City’s promises binding as to each of them individually. Those promises included overtime compensation, id. § 34-59(a)(3), (b), (d), holidays, and compensation for holidays not taken, id. § 34-59(e)(1), (e)(2), (e)(6), sick leave, id. § 34-59(i), vacation leave, id. § 34-59(j), and compensation for accrued sick and vacation leave upon termination of employment, id. § 34-3(b). The contract is also in writing. See generally Houston, Tex., Code of Ordinances , ch. 34. As explained earlier, “written” contracts may be “embodied in more than one document,” Restatement (Second) of Contracts § 95 cmt. b, including, as here, multiple ordinances, see City of Fort Worth , 22 S.W.3d at 840–41. Second, the Ordinances state the essential terms of the agreement between the Firefighters and the City. Section 271.151(2) does not define “essential terms,” but we have characterized “essential terms” as, among other things, “‘the time of performance, the price to be paid, . . . [and] the service to be rendered.’” Kirby Lake Dev. Ltd. v. Clear Lake City Water Auth. , 320 S.W.3d 829, 838 (Tex. 2010) (quoting Liberto v. D.F. Stauffer Biscuit Co. , 441 F.3d 318, 324 (5th Cir. 2006)). In the context of employment agreements, typical essential terms include, among others, “compensation, duties or responsibilities.” Martin v. Credit Prot. Ass’n, Inc. , 793 S.W.2d 667, 669 (Tex. 1990). Here, the Ordinances plainly reflect such terms. The time of performance is specified in the definitions of “workweek,” Houston, Tex., Code of Ordinances ch. 34, art. III § 34-59(a)(5), “time actually worked or actual work,” id. § 34-59(a)(6), and “overtime,” id. § 34-59(a)(3); and in the various holiday, vacation, and leave provisions, id. § 34-59(e), (i), (j). The price to be paid or compensation is located in the definitions of “overtime,” id. § 34-59(a)(3), and “regular rate of pay,” id. § 34-59(a)(4); and in the various termination pay, overtime, holiday, vacation, and leave provisions, id. §§ 34-3, 34-59(d), (e), (i), (j). The services to be rendered (duties or responsibilities) are likewise described in the Ordinances, as discussed above. See id. §§ 34-46, 34-48, 34-50 (describing the duties of the Firefighters). Third, the Ordinances provide for goods or services. We have previously held that “services” under section 271.151(2) encompass a wide array of activities, generally including any act performed for the benefit of another. Kirby Lake , 320 S.W.3d at 839. The Firefighters benefitted the City by providing fire protection services as defined in the Ordinances themselves. Houston, Tex., Code of Ordinances ch. 34, art. III, §§ 34-46, 34-48, 34-50. Fourth, the services were provided to a local governmental entity. The services were rendered to the City, and the Firefighters’ performance of those services was tracked by the fire chief. See id. § 34-59(c); see also Byrd , 6 S.W.2d at 740–41 (noting that a pension plan was given to retired firefighters as compensation for services rendered to the City of Dallas). Finally, the Ordinances were executed by the City. The City does not deny that the Ordinances were duly enacted, but does challenge whether they were “executed.” Section 271.151(2) does not define “executed.” We have noted that to “execute” means to “finish” or to “complete,” and that it is not necessary to sign an instrument in order to execute it, unless the parties agree that a signature is required. Mid-Continent Cas. Co. v. Global Enercom Mgmt., Inc. , 323 S.W.3d 151, 157 (Tex. 2010) (per curiam). No agreement between the City and the Firefighters establishing that a signature was required is before us. Therefore, the Ordinances, when duly enacted by the City with the intent to be bound, were “executed” under section 271.151(2). See id. In summary, the Ordinances meet each of the five elements required by section 271.151(2), and thus comprise a unilateral employment contract within the scope of section 271.152’s waiver of immunity.