Opinion ID: 1579863
Heading Depth: 2
Heading Rank: 3

Heading: mcdavid's claims

Text: The Code expressly permits a person who has sustained actual damages to bring a DTPA claim based on a franchised dealer's or manufacturer's violating certain Code provisions. Tex.Rev.Civ. Stat. art. 4413(36), § 6.06(a). Here, the court of appeals render[ed] the judgment the trial court should have rendered and dismiss[ed] McDavid's Code/DTPA claims for lack of jurisdiction. 10 S.W.3d at 69. The court of appeals explained that dismissal was required, because the primary jurisdiction doctrine required the Board to first decide if any Code violations support the DTPA claim. 10 S.W.3d at 69. Subaru points out that McDavid did not specifically argue in a cross point to this Court that the court of appeals improperly rendered judgment dismissing McDavid's DTPA claim. However, we need not decide if McDavid abandoned its Code-based DTPA claim. That is because, though the court of appeals erroneously relied on the primary jurisdiction doctrine rather than the exclusive jurisdiction doctrine for this conclusion, it correctly determined that the Board must initially decide if any Code violations exist to support the DTPA claim. Accordingly, under the Code's hybrid claims-resolution process, McDavid must first exhaust its administrative remedies to obtain final Board findings to support the DTPA claim. Then, if the Board's final findings are favorable, McDavid may maintain the Code-based DTPA action in the trial court. Tex.Rev.Civ. Stat. art. 4413(36), § 6.06(a). In trying the Code-based DTPA claim, the trial court shall pay due deference to the Board's final findings. Tex.Rev.Civ. Stat. art. 4413(36), § 6.06(a). As previously discussed, this means the trial court may not retry the Board's findings and must treat them as entirely binding.
A common-law duty of good faith and fair dealing does not exist in all contractual relationships. See Great Am. Ins. Co. v. North Austin Mun. Util. Dist. No. 1, 908 S.W.2d 415, 418 (Tex.1995). Rather, the duty arises only when a contract creates or governs a special relationship between the parties. See Arnold v. National County Mut. Fire Ins. Co., 725 S.W.2d 165, 167 (Tex.1987). We have declined to extend this common-law duty to all franchise agreements, holding that a franchisor does not exert control over its franchisee's business comparable to the control an insurer exerts over its insured's claim. Crim Truck & Tractor Co. v. Navistar Int'l Transp. Corp., 823 S.W.2d 591, 595-96 (Tex.1992). However, after Crim Truck, the Legislature expressly provided a statutory duty of good faith and fair dealing among parties to a car dealership franchise agreement. Tex.Rev.Civ. Stat. art. 4413(36), § 6.06(e). And, the Legislature made this duty actionable in tort. Tex.Rev.Civ. Stat. art. 4413(36), § 6.06(e). Here, McDavid's pleadings do not clearly indicate the Code violations upon which it predicates its bad-faith claim. Rather, McDavid's pleadings only allude to Subaru's alleged contract and statutory breaches as supporting the bad-faith claim. Subaru moved for summary judgment on the bad-faith claim on the grounds that the Board has primary or exclusive jurisdiction and that this claim does not exist at common law. McDavid only responded that section 6.06(e) of the Code makes a bad-faith claim between parties to a car dealership franchise agreement actionable in tort. Because McDavid's pleadings base the bad-faith claim, at least in part, on Code breaches, the Board's exclusive jurisdiction under 3.01(a) requires McDavid to exhaust its administrative remedies to obtain Board findings about what Code violations, if any, support McDavid's bad-faith claim. Once the Board's findings about how Subaru violated the Code become final, McDavid may seek damages in the trial court based on any favorable Board findings. Tex.Rev.Civ. Stat. art. 4413(36), § 6.06(e). Again, in trying the bad-faith claim, the trial court shall pay due deference to the Board's final findings. Tex. Rev.Civ. Stat. art. 4413(36), § 6.06(a). That is, the Board's final findings cannot be retried and bind the trial court.
McDavid's pleadings allege that Subaru violated section 5.02(b)(15), which makes it unlawful for a manufacturer to deny or withhold approval of a written application to relocate except as the Code allows. But this provision applies to written, not oral, relocation requests. Tex. REV.CIV. STAT. art. 4413(36), § 5.02(b)(15). Consequently, we agree with the court of appeals that this section does not delegate to the Board the authority to resolve a dispute between a manufacturer and a dealer about an alleged oral agreement to relocate a franchise. See 10 S.W.3d at 66. Likewise, because the promissory-estoppel doctrine presumes no contract exists, Wheeler v. White, 398 S.W.2d 93, 96-97 (Tex.1965), McDavid's claim that Subaru is now estopped from denying the existence of an oral agreement with McDavid also falls outside the Code's province. However, the necessary facts underlying McDavid's breach of oral contract claims raise an issue that falls within the Board's exclusive jurisdiction. As we discussed above, the Code strictly regulates the number and locations of motor vehicle dealerships by requiring a license from the Board for each separate and distinct dealership location. Tex.Rev.Civ. Stat. art. 4413(36), § 4.02(c). The Board may deny a license if certain statutory factors exist, or if a denial is warranted in the face of third party protests. See TEX.REV.CIV. STAT. art. 4413(36), § 4.06(a)-(e). Thus, McDavid's breach of oral contract claims are predicated on the assumption that the Board would have allowed the relocation and granted the license under section 4.06. And the Board's exclusive jurisdiction gives it the sole authority to initially decide if it would have granted the license to allow the relocation. Consequently, McDavid must first exhaust its administrative remedies and obtain a final Board decision about whether the Board would have granted the license to allow the relocation. Then, McDavid can pursue its breach of oral contract claims in the trial court based on that final Board decision.