Jurisdiction Upheld in Cases Pending for 19 Years

Since 1994, the City of Dallas has been in litigation with its police, firefighters, and rescue officers. The question at hand is whether a referendum and ordinance passed in 1979 amounted to a one-time salary adjustment, as the city contends, or a perpetual entitlement in all future salary adjustments. More than a decade after the lawsuits started, the city suddenly remembered that it had governmental immunity, and filed pleas to the jurisdiction on that basis. In 2011, the Texas Supreme Court held that the officers could not pursue a declaratory judgment on their interpretation of the ordinance because the only potential relief from such a declaration would be an award of money damages. City of Dallas v. Albert, 354 S.W.3d 368 (Tex. 2011). In the meantime, however, the legislature had enacted a new, retroactive statute that waived local governments’ immunity from suit for certain breach of contract claims. See Tex. Local Gov’t Code § 271.151 et seq. The case was therefore remanded to the trial court to consider whether there was jurisdiction to hear the officers’ breach of contract claims. The trial court denied the city’s renewed pleas to the jurisdiction, ruling that the contract claims fell within the new statutory waiver of immunity. On interlocutory appeal, the Court of Appeals agreed.

The analysis is somewhat lengthy, but its core relies on City of Houston v. Williams, 353 S.W.3d 128 (Tex. 2006) for the proposition that city ordinances can create a unilateral contract between the city and its employees that is within the scope of the legislature’s waiver of governmental immunity. Finding all of the elements of such a contract contained within the 1979 ordinance, the Court of Appeals concluded that it was a unilateral contract between the city and the officers. However, on the key question of whose interpretation of the ordinance would prevail, the court deferred to one of its previous rulings in the case, holding that the ordinance was ambiguous and its interpretation was therefore a question of fact to be determined at trial. The court also held there was no jurisdiction on the remaining declaratory judgment claims, concluding that the Albert decision had already established the city was entitled to governmental immunity from such claims.

City of Dallas v. Arredondo, No. 05-12-00963-CV