Hardy Rawls v. Texas Commission on Environmental Quality and Cajun Ready Mix, Ltd.--Appeal from 200th District Court of Travis County

Opinion filed June 28, 2007

Opinion filed June 28, 2007

In The

Eleventh Court of Appeals

__________

   No. 11-05-00368CV

__________

   HARDY RAWLS, Appellant

V.

TEXASCOMMISSION ON ENVIRONMENTAL QUALITY AND

CAJUN READY MIX, LTD., Appellees

On Appeal from the 200th District Court

Travis County, Texas

Trial Court Cause No. GN4-03681

M E M O R A N D U M O P I N I O N

Hardy Rawls filed suit against Texas Commission on Environmental Quality (TCEQ) and Cajun Ready Mix, Ltd. seeking judicial review of a concrete batch plant permit. The trial court granted TCEQ s and Cajun s pleas to the jurisdiction and dismissed Rawls=s suit. We affirm.

 

I. Background Facts

Cajun filed a standard permit registration with TCEQ for a concrete batch plant to be located in Montgomery, Texas.[1] The standard permit application process is a simplified permitting process for typical plants. 30 Tex. Admin. Code ' 116.602 (2007). To qualify, the proposed plant must produce less than 300 cubic yards of concrete per hour, less than 30 cubic yards of specialty material per hour,[2] or be a temporary plant. The plant must have certain required filter and collection equipment, conveying systems, and warning devices; must utilize specified dust control measures; and must maintain a set distance from the property line or use dust suppression fencing.

On May 3, 2004, TCEQ declared Cajun=s application administratively complete and directed it to provide public notice of the pending application.[3] Cajun published notice in two local newspapers on May 27, 2004. Cajun s notice indicated that the public could submit comments or request a public meeting and that individuals residing within 440 yards of the proposed plant could request a contested case hearing. The notice also provided that, if no hearing was requested within fifteen days, TCEQ could approve the application and that no further opportunity for hearing would be provided.

Rawls did not timely request a contested case hearing, but TCEQ scheduled a public meeting for August 16, 2004. Rawls=s counsel appeared and submitted a letter with comments in opposition to Cajun s application, a report from Hunt Air Strategies, and a hand-written request for a contested case hearing. The Hunt report stated that, when the cumulative PM10 emissions from Cajun s plant and a neighboring asphalt plant were added to background PM10 levels in Montgomery County, the total could exceed the applicable National Ambient Air Quality Standard (NAAQS).[4]

 

TCEQ determined that Cajun s application met the standard permit requirements and permitted the construction and operation of the proposed concrete batch plant. Rawls filed a motion for reconsideration that was overruled by operation of law. Rawls then filed suit in state court against TCEQ and Cajun. They responded with pleas to the jurisdiction. The trial court granted the pleas and dismissed the litigation.

II. Issues

Rawls challenges the trial court s ruling with three issues. Rawls contends that the trial court had jurisdiction because he exhausted his administrative remedies before filing suit, that it was unnecessary to do so because his suit presented a question of pure law, and that Cajun s plant was ineligible for a standard permit.

III. Standard of Review

A plea to the jurisdiction challenges a trial court=s authority to determine the subject mater of the suit. Godley Indep. Sch. Dist. v. Woods, 21 S.W.3d 656, 658 (Tex. App.CWaco 2000, pet. denied). Jurisdiction is a question of law and, therefore, we review the trial court=s ruling de novo. State ex rel. State Dep=t of Highways and Pub. Transp. v. Gonzalez, 82 S.W.3d 322 (Tex. 2002). A plaintiff must plead facts that affirmatively show the trial court s jurisdiction. Tex. Ass=n of Bus. v. Tex. Air Control Bd., 852 S.W.2d 440, 446 (Tex. 1993). We take the jurisdictional allegations in the petition as true, and we construe them liberally in favor of the plaintiff. Tex.Dep=t of Parks & Wildlife v. Miranda, 133 S.W.3d 217, 226 (Tex. 2004). We do not look to the merits of the case, but consider only the pleadings and evidence relevant to the jurisdictional inquiry. Id. at 227.

IV. Analysis

A. Did Rawls Exhaust His Administrative Remedies?

It is well settled that a party must exhaust its administrative remedies before seeking judicial review of a decision within the exclusive jurisdiction of an administrative agency. See Thomas v. Long, 207 S.W.3d 334, 340 (Tex. 2006). The Austin Court has held that not requesting a contested case hearing constitutes a failure to exhaust administrative remedies. See Friends of Canyon Lake, Inc. v. Guadalupe-Blanco River Auth., 96 S.W.3d 519, 526-27 (Tex. App.CAustin 2002, pet. denied).

 

Rawls does not dispute that TCEQ has exclusive jurisdiction over standard permits, and he concedes that he did not request a contested case hearing within fifteen days of Cajun s notice. However, he contends that TCEQ reopened the administrative record when it held the August 16 public meeting; that it invited Rawls to request a contested case hearing at this meeting; and that, because he did so and because he also filed a motion for reconsideration when TCEQ granted Cajun s application, he exhausted his administrative remedies.

Rawls s characterization of the effect of TCEQ s decision to hold a public meeting is inconsistent with the statutory provisions governing public meetings and contested case hearings. These provisions make clear that the two are separate, distinct processes which serve different purposes. For example, 30 Tex. Admin. Code ' 55.154(a) (2007) provides that [a] public meeting is intended for the taking of public comment, and is not a contested case under the APA. Tex. Health & Safety Code Ann. ' 382.05199(f) (Vernon Supp. 2006) provides that Section 382.056 of this Code and Chapter 2001, Government Code, do not apply to a public hearing held under this section. By excluding Chapter 2001, the legislature exempted public meetings from compliance with a wide variety of procedural requirements such as following evidentiary rules[5] and the obligation to provide parties with an opportunity to cross-examine witnesses,[6] to present witnesses and argument on each issue,[7] or to conduct discovery.[8]

 

Not only are the procedures distinct, the right to participate as a party in a contested case hearing and the right to offer comment at a public meeting are quite different. A party must have standing to request a contested case hearing. This generally requires a personal justiciable interest not common to members of the general public and is limited to individuals who would be affected by the emissions that would result if the permit were granted. See United Copper Indus. Inc., v. Grissom, 17 S.W.3d 797, 802 (Tex. App.CAustin 2000, pet. Dism d). For standard concrete batch plant permits, this is statutorily defined as individuals residing in a permanent residence within 440 yards of the proposed plant. Tex. Health & Safety Code Ann. ' 382.058(c) (Vernon Supp. 2006). No such restriction exists for public meetings. See Section 382.05199(f) ( Any person may submit an oral or written statement concerning the application at the public hearing ).

These contrasting provisions indicate that the legislature created contested case hearings to administratively resolve, in a structured setting, disputed questions of fact and law between parties with standing, and that it intended for public meetings to provide the general public an informal opportunity to participate in the administrative decision-making process. Cajun properly notified Rawls of his right to request a contested case hearing. He did not do so and, therefore, did not take advantage of his opportunity to adjudicate any contested issues. The August 16 public meeting was not a substitute for a contested case hearing. Instead, it provided Rawls B as well as any other member of the general public B an opportunity to comment on Cajun s application. Because the two processes are by design dissimilar and serve disparate purposes, we cannot agree that TCEQ s decision to hold a public meeting revived Rawls s right to request a contested case hearing.

Nor did TCEQ s conduct otherwise create jurisdiction or excuse Rawls s failure to exhaust his administrative remedies. We note first that jurisdiction cannot be created by estoppel or waiver. See Van Indep. Sch. Dist. v. McCarty, 165 S.W.3d 351, 354 (Tex. 2005). Second, the TCEQ representative s comments cannot be fairly described as reopening the application review process. During the public hearing, the following exchange took place:

COUNSEL FOR RAWLS: Frankly, I asked for an extension of time so that we could put together a better set of comments. I was told there would be no extensions of time. I want to complain at this point about the due process issues associated with, one, a fifteen day period to request a contested case hearing. That s where this issue should have gone, was to contested case. But nobody in this town found out about it soon enough to request a contested case because the notice was insufficient. If we d had a contested case proceeding, I could have put this evidence on before a State Office of Administrative Hearings Administrative Law Judge. I ve been C my clients have been denied the right to do that. I request a contested case hearing at this point in time on the basis of the documentation that was submitted just for the record to make the request. That s the mechanism that we have to protect life and to protect property. And it s been denied the people here and it s a violation of due process. Thank you very much.

 

TCEQ: Thanks, Jim. Hey, Jim, that hearing request is in your written comments that you handed to me?

COUNSEL FOR RAWLS: No, I did not. That s an oral request that backs it up. But I am orally requesting a contested case hearing.

TCEQ: OK, why don t I get you to put it on here for me.

COUNSEL FOR RAWLS: Would you like me to C

TCEQ: C write it on here for me.

COUNSEL FOR RAWLS: I will submit it in writing.

TCEQ: OK.

COUNSEL FOR RAWLS: And make a specific request for a contested case hearing on the basis of the evidence that we have here.

TCEQ: OK, Thanks Jim. Appreciate it.

The TCEQ representative did not solicit a request for a contested case hearing or otherwise extend the deadline for doing so. He simply asked Rawls to reduce his oral request to writing.

 

Rawls contends that the public meeting had no purpose if not to reopen the administrative record. We disagree. The meeting provided the general public B free of any standing requirement B with an opportunity to informally dialogue with TCEQ concerning Cajun s application. The public was given the opportunity to share their comments, to hear the comments and concerns of others, and to receive TCEQ s subsequent written response. Furthermore, TCEQ s executive director was statutorily required to consider these comments when evaluating Cajun s application. See Section 382.05199(h).[9] TCEQ s executive director did provide a written response to the comments received at the public meeting B including Rawls s contention that the combination of Cajun s plant and an adjacent asphalt plant would exceed the NAAQS for PM10.[10] The meeting, therefore, served the purpose intended for it by the legislature.

The trial court correctly found that Rawls failed to exhaust his administrative remedies. Issue one is overruled.

B. Pure Question of Law.

Rawls next contends that his claim presents a pure question of law and, therefore, is not subject to the exhaustion of administrative remedies requirement. The State responds that this exception is inapplicable because it only applies to litigation filed before a final agency order. Rawls does not dispute this limitation, but he argues that he satisfied it by participating in the public meeting before TCEQ issued a final order. We disagree. The exact dimensions of this doctrine are uncertain. It can, in appropriate circumstances, be used to seek injunctive relief preventing a void act. See, e.g., Benavides Indep. Sch. Dist. v. Guerra, 681 S.W.2d 246, 248-49 (Tex. App.CSan Antonio 1984, writ ref=d n.r.e.) (principal allowed to seek injunction without exhausting all administrative remedies when there were no unresolved fact questions). But, the mere characterization of a dispute as a legal issue is insufficient to invoke the doctrine. See, e.g., MAG-T, L.P. v. Travis Cent. Appraisal Dist., 161 S.W.3d 617, 635 (Tex. App.CAustin 2005, pet. denied). We need not decide today what is covered by the question of law exception, for it is clear that Rawls may not use it to collaterally attack TCEQ s decision to permit Cajun s plant.

 

The Texas Supreme Court acknowledged the question of law exception in Grounds v. Tolar Indep. Sch. Dist., 707 S.W.2d 889, 892 (Tex. 1986), but held that it does not apply to all legal determinations. In Grounds, a teacher/football coach was nonrenewed. He filed a grievance, lost, and appealed to the Commissioner of Education. The Commissioner found for Grounds and ordered the school district to re-employ him in the same professional capacity. The school district did not file a motion for rehearing or appeal the Commissioner s decision to a Travis County district court. Instead, it filed a declaratory judgment action in Hood County. The school district claimed that it was not required to exhaust its administrative remedies prior to filing suit because the case involved a pure question of law: was Grounds a probationary employee? The court held that the exception was inapplicable because the Commissioner had the authority to determine a teacher=s rights under the Term Contract Nonrenewal Act[11] and that, therefore, whether a subsequently adopted probationary policy could be applied to Grounds s employment contract was not a pure question of law. Id.

The construction of an unambiguous contract is ordinarily considered a question of law. See MCI Telecomms. Corp. v. Tex. Utils. Elec. Co., 995 S.W.2d 647, 650-51 (Tex. 1999). The application of a statute to a contract would, therefore, appear to present a question of law. But the Austin Court has explained Grounds by writing: questions dedicated to an administrative agency as part of its exclusive jurisdiction in a statutory scheme to interpret are not subject to collateral attack in district court without first exhausting the administrative remedies provided in the statutory scheme, even if the aggrieved party characterizes the question as a pure questions (sic) of law. MAG-T, 161 S.W.3d at 635 (because taxing authority had exclusive jurisdiction to interpret and act under an amnesty provision, its application of that statute could not be collaterally attacked under the pure question of law exception).

Rawls contends that TCEQ violated Section 382.05195 and 30 Tex. Admin. Code '' 101.21, 116.111(a)(2), 116.161 (2007) when it permitted Cajun s plant because the plant s PM10 emissions may exceed state and federal law. However, TCEQ has exclusive jurisdiction to interpret and apply these statutes. Moreover, TCEQ=s decision is final. Rawls s challenge, therefore, is a collateral attack on that decision. Because the question of law exception may not be used to collaterally attack an agency s interpretation and application of the statutes within its exclusive jurisdiction, it is inapplicable to this case. See Friends of Canyon Lake, 96 S.W.3d at 528 (whether TRNCC correctly complied with all the intricacies of the water rights permit application process did not confer jurisdiction under the question of law exception).

 

The exception is also inapplicable because the facts are unresolved.[12] Rawls does not contend that Cajun s plant will definitively result in a NAAQS violation, but claims that it may violate the 24 hour NAAQS for PM10. [13] Rawls s ultimate goal may be to permanently block the construction and operation of Cajun s plant, but he is not seeking that result in this litigation. His contention is that TCEQ should order further study because Cajun s plant is not a stand-alone facility due to the presence of an adjacent asphalt plant. Rawls s contention implicates, rather than excludes, the exhaustion of administrative remedies doctrine because he was afforded an opportunity to request a contested case hearing to determine the facts and law necessary to resolve issues such as these.

Rawls s second issue is overruled. Because we have found that Rawls failed to exhaust his administrative remedies and that no exception to this requirement applies, it is unnecessary to address his third issue.[14] Tex. R. App. P. 47.1.

V. Holding

The judgment of the trial court is affirmed.

RICK STRANGE

JUSTICE

June 28, 2007

Panel consists of: Wright, C.J.,

McCall, J., and Strange, J.

 

[1]See Tex. Health & Safety Code Ann. '' 382.05195 (standard permit), 382.05198 (concrete batch plants) (Vernon Supp. 2006).

[2]I.e., mortar, grout mixing, or pre-cast concrete products.

[3]See Tex. Health & Safety Code Ann. ' 382.05199 (Vernon Supp. 2006) for the notice requirements.

[4]In 1970, Congress directed the EPA to devise National Ambient Air Quality Standards that limited various pollutants. See Envtl. Defense v. Duke Energy Corp., __U.S. __, 127 S. Ct. 1423, 1428, 167 L. Ed. 2d 295 (2007). These pollutants include PM10 which is airborne particulate matter consisting of solids or liquid droplets with an aerodynamic diameter of 10 microns or less. Available at http://www.epa.gov/cgi-bin/epaprintonly.cgi

[5]Tex. Gov=t Code Ann. ' 2001.081 (Vernon 2000).

[6]Tex. Gov=t Code Ann. ' 2001.087 (Vernon 2000).

[7]Tex. Gov=t Code Ann. ' 2001.051 (Vernon 2000).

[8]Tex. Gov=t Code Ann. ' 2001.091 (Vernon 2000).

[9]It is unnecessary for us to determine the extent of the executive director=s duty to Aconsider@ comments received at a public meeting and we express no opinion on it.

[10]The executive director responded:

Concrete batch plants as well as asphalt plants are considered minor sources whose strict emission control standards make it unlikely for such facilities to impact ambient air quality. Standard permits which authorize minor sources are not expected to cause or contribute to a NAAQS violation. The annual emissions of this facility will be 0.48 tons of TSP of which 0.32 tons will be PM10. Currently, the Montgomery County meets the NAAQS for PM.@

[11]Tex. Educ. Code Ann. '' 21.201-213 (Vernon 2006).

[12]See Dotson v. Grand Prairie Indep. Sch. Dist., 161 S.W.3d 289, 291-92 (Tex. App.CDallas 2005, no pet.); Taylor v. State Farm Lloyds, Inc., 124 S.W.3d 665, 669 (Tex. App.CAustin 2003, pet. denied).

[13]TCEQ=s executive director has stated that the plant is unlikely to impact ambient air quality.

[14]We note that the trial court also included in its order granting the pleas to the jurisdiction a statement affirming TCEQ=s decision. Because the trial court properly found that Rawls failed to exhaust his administrative remedies, it had no jurisdiction to do anything other than dismiss the suit. Our resolution of this appeal makes it unnecessary to address this any further.