City of Dallas v. Texas EZPawn, L.P. d/b/a EZ Money, Loan ServicesAppeal from 14th Judicial District Court of Dallas County (memorandum opinion )
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REVERSE and RENI)ER; Opinion Filed April 1, 2013. In The Qoitrt of Appeah3 li1ricI of xu at ki11a No. 05-i 2-01269-CV CITY OF DALLAS, Appellant V. rIEXAS EZPAWN, LP. DIBIA EZMONEY LOAN SERVICES, Appellee On Appeal from the 14th Judicial District Court Dallas County, Texas Trial Court Cause No. I)C-12-03373-A MEMORANDUM OPINION l3efore Chief Justice Wright and Justices Lang and Lang-Miers Opinion by Justice Lang-Miers This is an interlocutory appeal from the denial of the City of Dallas s amended plea to the jurisdiction. We reverse the trial court s order and render judgment granting the City s plea and dismissing appellee s lawsuit with prejudice. We issue this memorandum opinion pursuant to Texas Rule of Appellate Procedure 47.4 because the law to he applied in the case is well settled. Texas EZPAWN, L.P. operates a pawn shop in Dallas County. In 2003 it began to offer short- and long-term loans under the trade name EZMONEY Loan Services. In 2012 the City told EZPAWN that its loan services business constitutes an Alternative Financial Establishment under Dallas City Code section 51A-4.207 and that it must comply with the provisions of that section. As relevant here, section 51A-4.207 defines Alternative Financial Establishment as a car title loan business, check cashing business, or money transfer business. . , An alternative financial establishment does not include an establishment that provides tinanciul services that arc accessor to another main use. Dallas, rex., Code ch. 5 I A. art. IV, § 51 A4207( 1) (1987). EZPAWN disagreed with the City s interpretation ol section 51 A4.207 and informally attempted. but liiled. to persuade the City that EZMONEY is not an Alternative Financial Establishment. EZPAWN then filed this lawsuit seeking a judicial declaration that its loan services business is not an Alternative Financial Establishment, or, alternatively, that the business is accessory to its main pawn shop use. The City filed a plea to the jurisdiction based in part on governmental immunity. EZPAWN amended its petition and alleged that section 37.004 of the Uniform Declaratory Judgments Act waived the City s immunity because the suit seeks the determination of the question of whether the accessory use provisions of Dallas City Code sections 51A4.207 and 51A-4.217 should he construed to encompass the olfermg ol short term and long term loans to the customers of a pawn shop, incidental to the operation of the pawnshop jsicj. The City amended its plea to the jurisdiction to assert that the IJDJA did not waive its governmental immunity for a suit against the City for the construction or interpretation of an ordinance and that EZPAWN had not challenged the validity of the ordinance, In response, EZPAWN alleged that the waiver of immunity applies to suits involving statutory interpretation as well as invalidation. After a hearing, the trial court denied the City s amended plea and this interlocutory appeal followed. Standard of Review Governmental immunity from suit defeats a trial court s subject matter jurisdiction and is properly asserted in a plea to the jurisdiction. City cf Dallas v. Turley, 316 S.W.3d 762, 767 (Tex. App. Dallas 2010, pet. denied). Whether a trial court has subject matter jurisdiction is a question of law, which we review de novo. Id. 2-- When a plea to the jurisdiction challenges the pleadings, we must determine ii the pleader has alleged facts that affirmatively demonstrate the court s jurisdiction to hear the case. Id. The plaintiff hears the burden to allege facts that aflirmatively demonstrate the trial court s jurisdiction to hear the case. Id. We construe the allegations in the pleadings liberally in tavor of the plaintiff and look to the pleaders intent. Id. If the pleadings do not contain sufficient facts to affirmatively demonstrate jurisdiction, but might be cured by amendment, the issue is one of pleading sufficiency and the court should allow the plaintil an opportunity to amend. Tex. Dep t of Parks & Wi1dlif e. Miranda. 133 S.W 3d 217, 226-27 (Tex. 2004). On the other hand, if the pleadings affirmatively negate the existence of jurisdiction, then a plea to the jurisdiction may be granted without allowing the plaintiff an opportunity to amend its pleading. Id. at 227. Applicable Law [S jovereign immunity deprives a trial court of subject matter jurisdiction for lawsuits in which the state or certain governmental units have been sued unless the state consents to suit. hi. at 224. Municipalities are political subdivisions of the state and entitled to governmental immunity unless it has been waived. (Tex. Re aia Constr. Corp. v. City of Dallas, 197 S.W.3d 371, 374 2006). The waiver of governmental immunity must he in clear and unambiguous language. TEx. Gov T CODE ANN. 3 11.034 (West Supp. 2012). Analysis The issue in this appeal is whether section 37.004 of the UDJA waived the City s governmental immunity. The City argues there is no waiver for declaratory judgm ent actions seeking only to construe the meaning of a statute. It argues that because EZPAWN sought oniy a construction or interpretation of the city ordinance and did not seek to invalidate the section, governmental immunity bars the lawsuit. 3 Sect ion 37.004 states. A person affected by a ...municipal ordinance . validity arising under the ...ordinance . whose rights. status, or other legal tehit ions are . may have determined any question of construction or . . . and obtain a declaration ot rights, status, or other legal relations ihereunder. TEX. Civ. PRAC. & REM. CODE ANN. 37.004 (West 2008), § The Supreme Court ol lexas has stated that the UI)JA does not enlarge the trial court s jurisdiction and is mere! a procedural device for deciding, cases already within a courts jurisdiction. Tex, Dep t of lransp, v. Sefik, 355 S.W.3d 618. 621 22 (Tex. 2011) (quotin g Tex, Parks & Wildlife Dep t v. Sawyer Trust, 354 S.W.3d 384. 388 (Tex, 2011)), The court has recognized that the legislature expressly waived immunity for lawsuits challenging the validity of a municipal ordinance because section 37.006(b) of the IJDJA expressly requires joinder of a municipality in actions challenging the validity of a municipal ordinance. See Id. at 622 & n.3; see also City of LI Paso v. Heinrich, 284 S.W.3d 366, 373 n.6 (Tex. 2009)). But the court has concluded that the legislature through the UDJA has not clearly and unambiguous ly waived governmental immunity for actions in which the plaintiff seeks a declaration of his or her rights under a statute or other law. See Sefik, 355 S.W.3d at 621; Heinrich, 284 S.W.3d at 373 n.6. EZPAWN s petition does not challenge the validity of the ordinance: it seeks a construction of the ordinance. But EZPAWN does not direct us to any provision in the UDJA that expressly waives the City s immunity for that claim. It argues that three opinio ns from the supreme court have held that governmental immunity is waived for declaratory judgm ent actions seeking to construe a statute. We address each in turn. The first case that EZPAWN contends supports its argument is Texas Educat ion Agency i . Leeper, 893 S.W.2d 432 (Tex. 1994). EZPAWN quotes language from that case stating , [tjhe DJA expressly provides that persons may challenge ordinances or statute s, and that governmental entities must be joined or notified and [tjhe Act thus contem plates that -4- ç oreriitnental entities mar IN indeed, must be omed in suits io construe their legislative pronouncemnents, Id. at 446 (emphasis added). But this discussion was in the contex t of lawsuits in which governmental entities must be made a party. See Id. And the only provision in which a municipality must be made a party is in an action challenging the validity of a statute. See TEX. Civ. PRAc. & RiM. CODE ANN. § 37.00I.001 I. Additionally, in Leeier. the parties did challenge the validity of a statute See Leeper. 893 S.W.2d at 337 (class action suit filed to halt State s enforcement of compulsory attendance law based on nothing other than the fact that a child was being schooled at home ). The second case upon which EZPAWN relies is Texas Natural Resources C onse rvation Commission v. IT-Davy, 74 S. W .3d 849 (Tex. 2002). EZPAWN argues that IT-Do yr concluded that the term challenges was not limited to challenges to the validity of an ordinance or statute. but included challenges to a governmental entity s construction of the ordinance or statute . But in interpreting Leeper, the IT-I)avv court stated that the DJA expressly allows person s to challenge ordinances or statutes. Moreover, the DJA requires challengers to join govern mental entities in suits to construe legislative pronouncements Id. at 859 60. Because the UDJA requires governmental entities to be joined only in suits challenging the validity of an ordinance or statute, the ITDay case was referring to those types of challenges. See id. Additi onally, IT I)avv involved a contract dispute, not a challenge to the validity of the statute . See id. at 856 57. Finally, EZPAWN relies on Texas Lottery commission v. First State Bank of DcQueen, 325 S.W.3d 628 (Tex. 2010). The issue in that case was whether provisions of the Texas Uniform Commercial Code conflicted with provisions of the Texas Lottery Act and, consequently, rendered the provisions of the Texas Lottery Act ineffective. Id. at 639. Although the court used language like statutory interpretation and statutory construction, it was 5 undisputed that the lawsuit challenged the validity of the provisions of the Texas Lottery Act and did not simply seek an interpretallon of the statute. See itt. at 634-35, 610. Construing EZPAWN s a! legations liberally in its favor, we conclude that they do not allege facts that, if true, affirmatively demonstrate the trial court s subject matter jurisdiction. Indeed, because EZPAWN sought only the interpretation of an ordmance and a declaration that the ordinance does not apply to its loan services business, we conclude that the allegations affirmatively negate the trial court s subject matter jurisdiction. See Turley, 316 S.W,3d at 770 71. Conclusion We sustain the City s issues, reverse the trial court s order, and render judgment dismissing the petition with prejudice. 12 1269F.P05 6 (!!nitrt of Appiu16 fift1! Jitrirt of exa Lit aU&u JUDGMENT CITY OF DALLAS. Appellant No, 05-12-01 269-CV V. TEXAS EZPAWN, LP. Dill/A EZMONEY LOAN SERVICES. Appellee On Appeal from the 14th Judicial District Court, Dallas County, Texas Trial Court Cause No. DC-I 2-03373-A. Opinion delivered by Justice Lang-Miers. Chief Justice Wright and Justice Lang participating. In accordance with this Court s opinion of this date, the judgment of the trial court is REV! RSI I) md IudgmLnt is RI NDEREI) th it City of Dallas s plea to the jurisdiction is GRANTED and appellee Texas EZPAWN, L.P. d/b/a EZMONEY Loan Services s lawsuit is dismissed with prejudice, It is ORDERED that appellant City of Dallas recover its costs of this appeal from appellee Texas EZPAWN. LP. dibia EZMONEY Loan Services. Judgment entered this l day of April, 2013. F /1(/ EL,VABTH LANG-?RS
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