Court Opinion

ID: 9388969
Source: CourtListenerOpinion
Date Created: 2023-04-23 14:07:18.856992+00
Date Added: 2024-06-11T17:18:24.200786
License: Public Domain

Supreme Court of Texas
                     ══════════
                      No. 19‑0612
                     ══════════

Mosaic Baybrook One, L.P., and Mosaic Baybrook Two, L.P.,
                       Petitioners,
                            v.
                      Paul Simien,
                       Respondent
═══════════════════════════════════════
           On Petition for Review from the
    Court of Appeals for the First District of Texas
═══════════════════════════════════════

         ~ consolidated for oral argument with ~
                     ══════════
                      No. 21-0159
                     ══════════

Mosaic Baybrook One, L.P.; Mosaic Baybrook Two, L.P.; and
                Mosaic Residential, Inc.,
                       Petitioners,
                            v.
                      Paul Simien,
                       Respondent
═══════════════════════════════════════
           On Petition for Review from the
    Court of Appeals for the First District of Texas
═══════════════════════════════════════
      JUSTICE BLAND, joined by Chief Justice Hecht, Justice Blacklock,
and Justice Huddle, dissenting.

      The Court imposes sweeping statutory liability by equating an
imprecise billing label to an “overcharge.” In doing so, it commits far
weightier errors of imprecision than the landlord by expanding the text
of the governing statute and its implementing rules beyond their
expressly limited scope.
      The fees the landlord charged were not fabricated. The tenants
received the utility services that the local municipal utility district
provided. The landlord charged the fees for these services with two
separate line items. One item charged a master-metered water and
sewer fee, based on customer usage, which the landlord allocated to the
tenant according to the Public Utility Commission of Texas’s approved
method. The tenant has no quarrel with that assessment.
      The other item, labeled a water and sewer “Base Fee” in the
billing statement, bundled the utility district’s other per-apartment fees
(for law enforcement, fire, and emergency medical services) with the
district’s monthly base charge for all of its services, including water.
None of these fees—each set by the utility district per apartment unit—
involved metered service that varied based on water usage.
      The regulatory rule the tenant claims the landlord violated
governs the proper assessment of metered water usage costs. Despite no
evidence of any metered overcharge, the Court holds the landlord liable
as a matter of law to an entire class of tenants under a provision directed
to metered usage. In so doing, the Court ignores the statute’s
limitations—limitations that are further reflected in the statute’s

                                    2
implementing rules. The Court also contravenes our regular admonition
to look behind labels to adjudge the substance, imposing class action
liability without evidence of an overcharge.1 Because the class action
plaintiff in this case was not overcharged under the applicable Water
Code provision and implementing rules, and the Court holds differently,
I respectfully dissent.
                                       I
       Petitioners Mosaic Baybrook One, L.P.; Mosaic Baybrook Two,
L.P.; and Mosaic Residential, Inc. operate an apartment complex in
Harris County. Respondent Paul Simien lived in one of Mosaic’s
apartment buildings.
       Harris County Municipal Utility District 55 provides local utility
services to the apartment complex and its tenants. District 55 charged
for its services pursuant to a governing rate order. First, District 55
charged for monthly water and sewer usage, based on the metered
number of gallons used multiplied by the rate set forth in its rate order.
In addition, District 55 charged (1) a monthly law-enforcement-service
fee “per each apartment unit,” (2) a monthly emergency-medical-service

       1 See, e.g., U.S. Fid. & Guar. Co. v. Goudeau, 272 S.W.3d 603, 612 (Tex.
2008) (“[C]ourts must look behind names that symbolize the parties to
determine whether a justiciable case or controversy is presented.” (quoting
United States v. Interstate Com. Comm’n, 337 U.S. 426, 430 (1949))); First USA
Mgmt., Inc. v. Esmond, 960 S.W.2d 625, 627 (Tex. 1997) (“Whether an amount
of money is interest depends not on what the parties call it but on the substance
of the transaction.”); Cameron v. Cameron, 641 S.W.2d 210, 221 (Tex. 1982)
(“Each court has looked behind the label when dividing marital property, that
which was acquired during marriage.”); Gonzales Cnty. Sav. & Loan Ass’n v.
Freeman, 534 S.W.2d 903, 907 (Tex. 1976) (“[C]ourts must look beyond mere
labels to the substance of many charges in order to be able to determine
whether such fees in reality constitute usury.”).

                                       3
fee “per each apartment unit,” (3) a monthly fire-protection fee “per
equivalent connection,” and (4) a monthly service charge “per apartment
unit.” The District assessed this service charge collectively “for the sale
of water, collection, and disposal of sewer, fire protection, emergency
medical and law enforcement . . . within the District.”
      Each month, District 55 billed Mosaic for its utility services.
Mosaic forwarded District 55’s bill to its billing coordinator, RealPage
Utility Management, Inc., or its predecessor. Using District 55’s billing
statement, RealPage generated tenant bills for each month’s rent and
fees. The pertinent tenant charges are reflected in one of Simien’s bills:

       Water/Sewer Base Fee (7/1/2016 - 7/30/2016)
            Base Fee Amt                                    $35.49

       Water/Sewer (7/1/2016 - 7/30/2016)
            # Bdrms: 2 Factor: 2.80 Rate: 5.7814677         $15.65

While the dates, amounts charged, and rate for the second
“Water/Sewer” fee varied from month to month, the descriptions
remained constant on Simien’s bills.
      The first charge on Simien’s bill—the “Water/Sewer Base Fee”—
consisted of District 55’s “per unit charge” for its “monthly service
charge, monthly fire protection rate, monthly emergency medical service
rate, and monthly law enforcement service rate.” The second charge—
the “Water/Sewer” fee—allocated District 55’s master-metered water-

                                    4
usage charges among Mosaic’s tenants, according to the Public Utility
Commission’s approved allocation method.2
       While Simien was a tenant in February 2017, he sued Mosaic
individually and on behalf of others similarly situated, alleging in a
single-count petition that Mosaic violated Water Code Section 13.505
and the Utility Commission’s implementing rules. Mosaic denied
Simien’s allegations. Simien moved for a traditional partial summary
judgment, seeking to impose class-wide statutory liability. Simien
claimed that Mosaic violated Water Code Section 13.505 and its related
Utility Commission rules as a matter of law by not separately
identifying District 55’s per-apartment utility-service fees based on the
service provided. Mosaic responded that it “incorrectly named a group
of charges from the MUD 55,” but that such charges were distinct from
the “monthly water service and monthly sewer service charges that are
charged by the MUD 55 on a usage basis and then allocated by [Mosaic]
consistent with Texas law.”
       The trial court granted Simien’s motion, but it also granted
permission to Mosaic to seek an interlocutory appeal of its ruling under

       2 See 39 Tex. Reg. 2667, 2718 (2014), adopted by 39 Tex. Reg. 5903
(2014), amended by 43 Tex. Reg. 6826 (2018) (formerly 16 Tex. Admin. Code
§ 24.124(e)(2)(A)(iii)(III), now codified at 16 Tex. Admin. Code
§ 24.281(e)(2)(A)(iii)(III)) (Pub. Util. Comm’n of Tex., Substantive Rules
Applicable to Water and Sewer Service Providers). The applicable Utility
Commission rules were formerly located in Title 16, Chapter 24,
Subchapter H. In 2018, after this case commenced, the regulations “were
renumbered for administrative ease,” which included “renaming and
relettering certain subchapters,” but the old and new regulations are
substantially identical. 43 Tex. Reg. 6826 (2018) (Pub. Util. Comm’n of Tex.).
This opinion cites the applicable former regulations.

                                      5
Civil Practice and Remedies Code Section 51.014(d). The court of
appeals declined to hear that appeal,3 despite affirming the trial court’s
class certification order based on the class’s common claim of a Water
Code violation.4
       Mosaic petitioned this Court for review. We have jurisdiction to
decide the question of law presented in Mosaic’s petition.5
                                        II
       At the time of Simien’s petition, Water Code Section 13.505
imposed liability against a landlord who “violates a rule of the utility
commission regarding . . . nonsubmetered master metered utility costs.”6
Under that version of Section 13.505, “the tenant may recover three
times the amount of any overcharge” plus other remedies for a landlord’s
improper allocation of those costs.7 The question thus presented in this

       3644 S.W.3d 671, 672 (Tex. App.—Houston [1st Dist.] 2019) (citing Tex.
R. App. P. 28.3(e)(4)).
       4   646 S.W.3d 847, 857 (Tex. App.—Houston [1st Dist.] 2020).
       5 Sabre Travel Int’l, Ltd. v. Deutsche Lufthansa AG, 567 S.W.3d 725,
736 (Tex. 2019) (“The pure legal question at issue here is precisely the sort of
question section 51.014(d) was enacted for—allowing an early resolution when
the interlocutory order meets the Legislature’s threshold for an exception to
the final judgment rule.”); Valero Refinery-Tex., LP v. Vela, 647 S.W.3d 709,
710 (Tex. 2022) (“Notwithstanding the court of appeals’ refusal to accept the
appeal, this Court has jurisdiction to review the trial court’s interlocutory order
on the merits.”).
       6 Act of May 13, 2013, 83d Leg., R.S., ch. 171, § 83, sec. 13.505, 2013
Tex. Gen. Laws 772, 809–10 (emphasis added) (amended 2017) (current
version at Tex. Water Code § 13.505).
       7   Id.

                                        6
appeal is whether Mosaic violated a Utility Commission rule governing
master-metered utility costs. It did not.
       Mosaic’s bundling of District 55’s monthly service charge with the
District’s other per-unit fees for police, fire, and medical utility services
does not involve metered utility costs as the statute and implementing
rules define them. Mosaic has argued since its trial court briefing that
the base fee is a “collection of . . . permissible charges” properly charged
on a per-unit basis that “simply have nothing to do with water or
wastewater service.” Mosaic does not contest that the base fee is
regulated by the Utility Commission rules, but instead argued that the
charge was “expressly permitted by the PUC rules when charged on a
per-unit basis, as it was done here.”8
       Ignoring the crucial distinctions between the types of charges and
specific rules governing them, the Court holds that bundling the
District’s per-unit utility fees together failed to comply with Utility
Commission Rule 24.124. Rule 24.124(a) at the time prohibited a
landlord from bundling other charges together with master-metered fees
that are further submetered or allocated to the tenant for the tenant’s
water or wastewater utility usage:
       Prohibited charges. Charges billed to tenants for
       submetered or allocated utility service may only include
       bills for water or wastewater from the retail public utility
       and must not include any fees billed to the owner by the

       8 Accordingly, we reject the Court’s view that Mosaic did not preserve
this argument for review. Ante at 43–44.

                                     7
       retail public utility for any deposit, disconnect, reconnect,
       late payment, or other similar fees.9

       The rule prohibited bundling of other charges with “[c]harges
billed to tenants for submetered or allocated utility service.”10 “Allocated
utility service” is a defined term in the rules: “[w]ater or wastewater
utility service that is master metered to an owner by a retail public
utility and allocated to tenants by the owner.”11 In other words,
“allocated utility service” involves one particular kind of utility service:
service that is initially master-metered—under the rules, a usage
charge based on a meter that “measure[s], for billing purposes, all water
usage of an apartment house”—and then further allocated to the tenant

       9   39 Tex. Reg. at 2717 (now codified at 16 Tex. Admin. Code § 24.281(a)).
       10  Id. Rule 24.124(a)’s prohibition against including certain fees in the
charges billed for allocated utility service is inherently superfluous: (1) the
definition of “allocated utility service” is already exclusive of such fees; (2) such
fees are not “water or wastewater from the retail public utility” under the
ordinary meaning of those terms; (3) Rule 24.125(e)’s requirement that
allocated utility service be “separate and distinct from any other charges on
the bill” already prohibits bundling charges for water and wastewater use with
any other fees; and (4) Rule 24.124(e) requires the owner to deduct “dwelling
unit base charges or customer service charge[s]” before allocating the master
meter bill among tenants. 39 Tex. Reg. at 2715–19 (now codified at 16 Tex.
Admin. Code §§ 24.275(c)(1), .281(a), .283(e), .281(e)(1)). The Utility
Commission is under no strictures to avoid superfluity; it may use as many
belts and suspenders as it wishes to ensure that the charge for water and
wastewater usage is precisely calculated and not commingled with other
amounts. Whatever application the rule against superfluity has in interpreting
regulations, it is only a secondary canon that cannot overcome the meaning of
“allocated utility service” that the regulation provides.
        39 Tex. Reg. at 2715 (emphases added) (now codified at 16 Tex.
       11

Admin. Code § 24.275(c)(1)).

                                         8
by the landlord.12 This definition limits the scope of the governing rule.
The Court’s misapprehension of it infects its analysis throughout.
       Applying the proper definition of “allocated utility service,”
Mosaic’s bill complies with Rule 24.124. Simien’s second item, the fee for
“Water/Sewer” (billed at $15.65 on Simien’s sample bill), used
District 55’s master-metered amount and allocated that amount to its
tenants according to “the average number of occupants per bedroom,” as
the   Utility     Commission’s      “occupancy     formula”    requires.13      The
“Water/Sewer” fee is the item and charge for owner-allocated, master-
metered utility service under Rule 24.124. It is the charge “billed to
tenants for submetered or allocated utility service [that] only include[s]
bills for water or wastewater from the retail public utility.”14 It does not
“include any fees billed to the owner by the retail public utility for any
deposit, disconnect, reconnect, late payment, or other similar fees.”15
This fee is not bundled with any other charge. Simien concedes as much.
       Supplying its own definition of “allocated utility service” instead
of the one the rules provide, however, the Court concludes that
Rule 24.124(a) must be read to further “prohibit[] any amount that a
landlord bills a tenant for utility service from including non-water
charges.”16 The Court applies this broadened definition to the first item,

       12   Id. at 2716 (now codified at 16 Tex. Admin. Code § 24.275(c)(8)).
       13   Id. at 2718        (now    codified   at   16   Tex.   Admin.    Code
§ 24.281(e)(2)(A)(iii)).
       14   Id. at 2717 (now codified at 16 Tex. Admin. Code § 24.281(a)).
       15   Id.
       16   Ante at 34 (emphasis added).

                                           9
the base fee—which contains no master-metered charges whatsoever—
to hold that Mosaic nonetheless has violated Rule 24.124(a).
Rule 24.124(a) simply does not apply to the base fee of per-apartment
utility assessments that the utility district imposed. Neither does
Section 13.505, which also confined its scope to rule violations involving
“master metered utility costs.”17
       The Court dispenses with the regulatory definition found in the
text and replaces it with its own broader one because, it claims, a
landlord could “blatant[ly]” gin up a “tenant’s water usage charge or
base fee.”18 The Court claims that using the actual definition enables
“landlords to ‘use’ an approved allocation formula to make an initial
calculation and then make arbitrary adjustments wholly outside of that
formula based on the amounts of non-water charges.”19
       Such a contention is inaccurate. First, a landlord who added a
fictitious surcharge disguised as a water-usage charge violates
Rule 24.124(a)’s requirement that “[c]harges billed to tenants for
submetered or allocated utility service may only include bills for water
or wastewater from the retail public utility.”20 A charge invented by the
landlord is obviously not one “from the retail public utility.”

       17Act of May 13, 2013, 83d Leg., R.S., ch. 171, § 83, sec. 13.505, 2013
Tex. Gen. Laws 772, 809–10 (amended 2017) (current version at Tex. Water
Code § 13.505).
       18   Ante at 32.
       19   Id. at 35.
       20 39 Tex. Reg. at 2717 (now codified at 16 Tex. Admin. Code
§ 24.281(a)).

                                     10
       Second, the Utility Commission does not purport to regulate every
aspect of a Texas lease.21 For example, if a landlord charged a monthly
pet fee that exceeded the amount the tenant agreed to pay in the lease,
then the landlord may have overcharged the tenant and breached the
lease. But the charge does not violate the Utility Commission’s rules or
create statutory liability under Water Code Section 13.505 because the
statute and rules expressly confine their scope to violations involving
metered water charges.
       Third, contrary to the Court’s implication, Rule 24.124(c) permits
landlords to include a water-related “customer service charge” in the
base fee.22 District 55’s rate order set a monthly customer-service charge
per apartment. Mosaic separately charged the District’s service charge
from its tenants’ water- and sewer-usage fees, consistent with the
rules.23 Rule 24.124(a) does not prohibit bundling the customer service
charge with District 55’s other per-apartment utility fees; the rule
concerns only the presentation of the charge for master-metered and
further allocated utility service.

       21See Tex. Water Code § 13.5031(a) (“[T]he utility commission shall
adopt rules and standards governing billing systems or methods used by . . .
[landlords] for prorating or allocating among tenants nonsubmetered master
metered utility service costs.”).
       22See 39 Tex. Reg. at 2717 (“If the retail public utility’s rate structure
includes a customer service charge, the owner shall bill each dwelling unit the
amount of the customer service charge divided by the total number of dwelling
units, including vacant units, that can receive service through the master
meter serving the tenants.”) (now codified at 16 Tex. Admin. Code § 24.281(c)).
       23 Id. at 2719 (“If issued on a multi-item bill, charges for submetered or
allocated utility service must be separate and distinct from any other charges
on the bill.”) (now codified at 16 Tex. Admin. Code § 24.283(e)).

                                       11
       The Court attempts to skirt the limiting regulatory definitions by
looking to the definitions of “costs,” “rate,” and “service” to make the
point that the Utility Commission’s “authority to regulate how the costs
of master metered utility service are billed to tenants” is not limited to
“how tenants are billed for the metered gallons they use.”24 No one
disputes that point. As Mosaic correctly argues, however, the only
Utility Commission rule governing charges not measured in gallons
through a meter is the rule governing the customer service charge. And
that rule provides that the landlord “shall bill each dwelling unit the
amount of the customer service charge divided by the total number of
dwelling units, including vacant units, that can receive service through
the master meter serving the tenants.”25 The Utility Commission can
and has exercised its authority over water-related utility-service costs,
just not in the manner the Court envisions. The Utility Commission
definitions emphasize that the rules governing water and sewer per-
gallon charges are distinct from the rules governing the customer-
service charge. “Allocated utility service” encompasses only “service that
is master metered.”26 The customer-service charge, in contrast, “is a rate
that is not dependent on the amount of water used through the master
meter.”27 These contrasting definitions demonstrate that “allocated

       24 Ante at 45–46 & n.33 (citing Tex. Water Code §§ 13.002(21), .002(17),
.5031(a)).
       25 39 Tex. Reg. at 2717 (now codified at 16 Tex. Admin. Code
§ 24.281(c)).
       26   Id. at 2715 (now codified at 16 Tex. Admin. Code § 24.275(c)(1)).
       27   Id. (now codified at 16 Tex. Admin. Code § 24.275(c)(4)).

                                         12
utility service” is dependent on the amount of water used through a
master meter, or in other words, that “allocated utility service”
encompasses only utility service that is measured in gallons used.
Because Rule 24.124(a) governs only charges billed “for submetered or
allocated utility service,”28 the rule does not support the Court’s
expanded gloss that it prohibits the bundling of nonmetered charges.
      The Court attempts to rely on Rules 24.125(e) and (f) to justify its
alternative expanded definition. It describes subsection (e) as forbidding
“the bundling of fees related to water and wastewater service with any
fees unrelated to such service,”29 but, once again, the Court ignores that
the rule is confined to metered utility service. Subsection (e) provides
that, “[i]f issued on a multi-item bill, charges for submetered or allocated
utility service must be separate and distinct from any other charges on
the bill.”30 “Allocated utility service,” as discussed, does not encompass
any and all “fees related to water and wastewater service,”31 as the
Court generalizes, but only those for “[w]ater or wastewater utility
service that is master metered to an owner by a retail public utility.”32
The portion of Simien’s bill charging for “allocated utility service”—the
$15.65 in the sample bill—adheres to the rule. Mosaic presented it as a

      28   Id. at 2717 (now codified at 16 Tex. Admin. Code § 24.281(a)).
      29   Ante at 34.
      30  39 Tex. Reg. at 2719 (now codified at 16 Tex. Admin. Code
§ 24.283(e)).
      31   Ante at 34.
      32  39 Tex. Reg. at 2715 (now codified at 16 Tex. Admin. Code
§ 24.275(c)(1)).

                                       13
separate item on the bill. It is, as required, “separate and distinct from
any other charges on the bill.”33
       Rule 24.125(f) creates additional billing rules. It requires that a
utility bill include, among other things, the “(1) total amount due for
submetered or allocated water; (2) total amount due for submetered or
allocated wastewater; [and] (3) total amount due for dwelling unit base
charge(s) or customer service charge(s) or both, if applicable.” 34
Rule 24.125(f) does not require these charges to be “separate and
distinct,” as Rule 24.125(e) does, but merely requires that the total
amounts be “include[d].”35 A bill that separately identifies each utility
charge undeniably is more precise. And certainly, the Utility
Commission could have required landlords to separately identify each
and every utility customer-service charge from every other charge a
municipal utility district imposes.36 Under the Commission’s rules that
govern this case, however, the only charge that it elected to require be
“separate and distinct” is the charge for master-metered utility service
based on usage that the landlord further allocates to the tenant.37
       Ignoring District 55’s rate order and District 55’s bills to Mosaic,
the Court further theorizes that the fire, emergency-services, and

       33   Id. at 2719 (now codified at 16 Tex. Admin. Code § 24.283(e)).
       34   Id. (now codified at 16 Tex. Admin. Code § 24.283(f)).
       35   Id.
       36See Act of May 13, 2013, 83d Leg., R.S., ch. 171, § 82, sec. 13.5031,
2013 Tex. Gen. Laws 772, 809 (amended 2017) (current version at Tex. Water
Code § 13.5031).
       37 39 Tex. Reg. at 2719 (now codified at 16 Tex. Admin. Code
§ 24.283(e)).

                                        14
law-enforcement charges possibly could be “‘additional charges on a
tenant’ . . . ‘in excess of the actual charges imposed on’ the landlord.”38
Simien, however, has never alleged and does not claim as a ground for
summary judgment that the billed charges for fire, emergency services,
and law enforcement exceed those that District 55 billed to Mosaic per
apartment unit. Simien cannot uphold summary judgment on a ground
he did not raise in the trial court.39
       Giving “allocated utility service” its true regulatory definition
would, the Court claims, force plaintiffs to conduct discovery to
determine “whether a seemingly water-related charge on a tenant’s bill
was in fact attributable to costs unrelated to water service” before
proceeding in court.40 The Court relies on an inapplicable amended
version of Water Code Section 13.505 to raise this issue.41 Even so, a
concern about judicial efficiency does not justify dispensing with the
regulatory definition to judicially impose broader liability and civil
penalties than statutes and regulations permit.42

       38 Ante at 33 (quoting Act of May 13, 2013, 83d Leg., R.S., ch. 171, § 82,
sec. 13.5031(3), 2013 Tex. Gen. Laws 772, 809 (amended 2017) (current version
at Tex. Water Code § 13.5031(a)(3)).
       39See Stiles v. Resol. Tr. Corp., 867 S.W.2d 24, 25 (Tex. 1993) (“Because
the court of appeals erroneously affirmed on a ground not relied upon by the
[respondent] in its motion for summary judgment, and because the summary
judgment cannot be sustained on any ground that the [respondent] did rely
upon, we reverse the judgment and remand the cause to the trial court.”).
       40   Ante at 35.
       41   Id.
        The Court also speculates that, because the current version of Water
       42

Code Section 13.505 vests the Utility Commission with exclusive jurisdiction

                                       15
       The      remedies    provision      in   the   applicable   Water   Code
Section 13.505 contrasts with the Court’s strained reading. Under the
applicable version, a tenant may seek to “recover three times the amount
of any overcharge.”43 That calculation is derived from “water utility
service that is master metered for the apartment house” and the
“wastewater utility service based on master metered water utility
service.”44 Overcharge recovery under the statute thus depends on the
difference between metered water and wastewater charges, properly
allocated, compared to the way they were allocated in the bill.
       Under the Court’s interpretation, whether an overcharge in fact
happened does not matter. Simien need not show any water or
wastewater overcharge. Mosaic is instead liable for a statutory violation
because it labeled its fire-, police-, and medical-services fees as a
“Water/Sewer Base Fee” instead of “Water/Sewer/Fire/Police/Medical
Services Base Fee.” By focusing on a mathematical difference, however,
Section 13.505 does not permit imprecise labeling to serve as a proxy for
true overcharges.

over water-billing violations, a holding that the Water Code does not apply to
the claims made here could raise jurisdictional implications. Nothing in the
version of Section 13.505 that applies to Simien’s claims, however, vested the
Utility Commission with exclusive jurisdiction for the claims presented in this
case. See Act of May 13, 2013, 83d Leg., R.S., ch. 171, § 83, sec. 13.505, 2013
Tex. Gen. Laws 772, 809–10 (amended 2017) (current version at Tex. Water
Code § 13.505).
       43Act of May 13, 2013, 83d Leg., R.S., ch. 171, § 83, sec. 13.505, 2013
Tex. Gen. Laws 772, 809–10 (amended 2017) (current version at Tex. Water
Code § 13.505).
       44   Tex. Water Code § 13.501(4).

                                        16
       Finally, the barest passing reference to Simien’s lease in his
motion for summary judgment does not open the door to liability based
on an unpleaded breach-of-contract claim. In his petition, Simien
disclaimed any allegation “that the additional allocated charges were
added in a manner that is inconsistent with the . . . Lease Addendum for
Allocating       Water/Wastewater           Costs.”   The       Court   nonetheless
independently crafts yet another possible liability theory, based on an
unpleaded contract claim. The Court’s discussion exceeds the scope of
Simien’s summary judgment under Section 13.505, which is the only
pleaded cause of action and the only ground for summary judgment.
Section 13.505 provides a statutory cause of action when a landlord
“violates a rule of the utility commission regarding . . . nonsubmetered
master      metered     utility   costs.”45      Although   a    cost   imposed   in
contravention of a lease may be a breach of contract, it is not a violation
of rules governing master-metered utility costs. A summary judgment
cannot stand on a ground not presented in the trial court, based on a
claim that the plaintiff never pleaded.46
       The trial court’s error in imposing liability under the Water Code
as a matter of law should require it to re-examine its class-certification
order. Legally baseless theories cannot sustain certification of a class,
and the “rigorous analysis of the claim required by Rule 42 cannot

       45Act of May 13, 2013, 83d Leg., R.S., ch. 171, § 83, sec. 13.505, 2013
Tex. Gen. Laws 772, 809–10 (amended 2017) (current version at Tex. Water
Code § 13.505).
       46   See Stiles, 867 S.W.2d at 25.

                                            17
meaningfully or usefully be performed on a facially defective claim.”47
Without the summary judgment imposing statutory liability, Simien’s
basis for a class action dissolves. With the Court’s opinion in hand, this
class action proceeds.
                              *      *      *
      Simien did not establish a violation of the Water Code or the
Utility Commission’s rules. The Court should reverse the trial court’s
partial summary judgment imposing liability under the Water Code, as
well as the class-certification order, founded as it is on a fatal
misapprehension of law. Because the Court imposes class-action
statutory liability where none exists, I respectfully dissent.

                                          Jane N. Bland
                                          Justice

OPINION FILED: April 21, 2023

      47  Am. Campus Cmtys., Inc. v. Berry, ___ S.W.3d ___, ___, 2023 WL ___,
at *___ (Tex. Apr. 21, 2023).

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