Tex. Educ. Agency v. Houston Indep. Sch. Dist.

The Texas Education Agency; Mike Morath, Commissioner of Education in his Official Capacity;and Doris Delaney, in her Official Capacity, Appellants v. Houston Independent School District, Appellee

NO. 03-20-00025-CV

TEXAS COURT OF APPEALS, THIRD DISTRICT, AT AUSTIN

December 30, 2020

FROM THE 459TH DISTRICT COURT OF TRAVIS COUNTY, NO. D-1-GN-19-003695,

THE HONORABLE CATHERINE MAUZY, JUDGE PRESIDING

MEMORANDUM OPINION

Appellee Houston Independent School District (HISD) filed suit for injunctive and declaratory relief against Appellants the Texas Education Agency (TEA), the Commissioner of Education (the Commissioner), and Conservator Doris Delaney (collectively, Appellants). Appellants filed a plea to the jurisdiction contending that the suit is barred by sovereign immunity, and the district court implicitly denied the plea by granting a temporary injunction in favor of HISD. For the following reasons, we affirm the district court's order granting the temporary injunction.

BACKGROUND

Beginning in 2016 and continuing through 2019, Appellants took and threatened to take various actions against HISD under Chapters 39 and 39A of the Texas Education Code. See Tex. Educ. Code §§ 39.001-.413 (Chapter 39, "Public School System Accountability"), 39A.001-.907 (Chapter 39A, "Accountability Interventions and Sanctions"). These actions, which we discuss in more detail below, included appointing Delaney as a conservator for HISD, suspending HISD's search for a superintendent, initiating a Special Accreditation Investigation (SAI) against HISD based on alleged violations of the Texas Open Meetings Act and other laws, and threatening to lower HISD's accreditation status and replace HISD's elected Board of Trustees with an appointed board of managers.

In 2019, HISD filed suit against Appellants, seeking declaratory and injunctive relief. HISD sought declarations that: (1) the Commissioner has no legal authority to replace the elected Board of Trustees with a board of managers; (2) Delaney has no legal authority to direct HISD's Board of Trustees and administration to suspend the superintendent search; (3) the Commissioner has no legal authority to grant Delaney authority to oversee the governance of the district; and (4) the Commissioner has no legal authority to impose any sanctions or interventions on HISD based on the SAI. HISD also challenged the validity and applicability of TEA Rule 97.1061(g), which authorizes the Commissioner to order the appointment of a board of managers to a school district if a campus within the district is assigned an "unacceptable" rating for a fifth consecutive year. See 19 Tex. Admin. Code § 97.1061(g) (2020) (TEA, Interventions and Sanctions for Campuses). HISD further sought a temporary injunction prohibiting: (1) the Commissioner from appointing a board of managers, (2) Delaney from acting outside her lawful authority, and (3) the Commissioner from imposing any sanctions or interventions on HISDbased on the SAI. Finally, HISD asked the district court to deny any attempt by Appellants to supersede the injunction on appeal.

Appellants filed a plea to the jurisdiction, asserting that HISD failed to plead any valid ultra vires claims that would waive Appellants' sovereign immunity from suit. Following a hearing, the district court granted the temporary injunction, prohibiting: (1) the Commissioner from appointing a board of managers to oversee the operations of HISD, (2) Delaney from acting outside her lawful authority, and (3) the Commissioner from imposing any sanctions or interventions on HISD based on the SAI. This interlocutory appeal followed.¹

Plea to the jurisdiction

In their first issue, Appellants assert that the district court erred in denying their plea to the jurisdiction because sovereign immunity bars HISD's claims. According to Appellants, "HISD tried to plead ultra vires claims, but these claims lack merit as a matter of law, and some of the claims seek impermissible retrospective relief or are barred by statutory finality provisions."

Standard of review

"Sovereign immunity from suit defeats a trial court's subject matter jurisdiction and thus is properly asserted in a plea to the jurisdiction." Texas Dep't of Parks & Wildlife v. Miranda, 133 S.W.3d 217, 225-26 (Tex. 2004). "The trial court must determine at its earliestopportunity whether it has the constitutional or statutory authority to decide the case before allowing the litigation to proceed." Id. Whether a trial court has subject-matter jurisdiction is a question of law that we review de novo. Klumb v. Houston Mun. Emps. Pension Sys., 458 S.W.3d 1, 8 (Tex. 2015). "We construe the pleadings liberally in favor of the plaintiffs and look to the pleaders' intent" and "consider relevant evidence submitted by the parties when necessary to resolve the jurisdictional issues raised, as the trial court is required to do." Miranda, 133 S.W.3d at 226-27. Mirroring the standard of review in summary judgments, we take as true all evidence favorable to the nonmovant, indulging every reasonable inference and resolving any doubts in its favor. City of El Paso v. Heinrich, 284 S.W.3d 366, 378 (2009).

Sovereign immunity "does not prohibit suit against a state official if the official's actions are ultra vires." Honors Acad., Inc. v. Texas Educ. Agency, 555 S.W.3d 54, 68 (Tex. 2018) (citing Heinrich, 284 S.W.3d at 372). "To state an ultra vires claim, the plaintiff must allege and prove that the named officials acted without legal authority or failed to perform a ministerial act." Id. (citing Hall v. McRaven, 508 S.W.3d 232, 238 (Tex. 2017)). "The fact that the official has some limited discretion to act under the applicable law does not preclude an ultra vires claim if the claimant alleges that the official exceeded the bounds of that authority, or the conduct conflicts with the law itself." Id. (citing Houston Belt & Terminal Ry. Co. v. City of Houston, 487 S.W.3d 154, 163 (Tex. 2016)). "'Ultra vires claims depend on the scope of the state official's authority,' not the quality of the official's decisions." Honors Acad., Inc., 555 S.W.3d at 68 (citing Hall, 508 S.W.3d at 234). "Thus, it is not an ultra vires act for an official to make an erroneous decision within the authority granted." Id. Only when the decision is unauthorized does an official act ultra vires. Hall, 508 S.W.3d at 243.

Claims involving Delaney

We begin with HISD's claims involving Delaney. In 2016, the Commissioner sent a letter to HISD officials notifying them that the Commissioner was appointing Delaney as a conservator to HISD "to ensure and oversee district-level support for Kashmere High School ('campus') and implementation of the targeted improvement plan" for that campus, which had received unacceptable performance ratings for several years. The letter indicated that Delaney's role as conservator would include: "[e]nsuring that a comprehensive needs assessment of the campus is performed"; "[e]nsuring that an evaluation of the efficacy of the district's resource allocation to the campus for school years 2015-2016 and 2016-2017 is performed"; and "[o]verseeing instructional delivery at the campus for school year 2016-2017."

The Commissioner continued Delaney's appointment as a conservator for Kashmere High School in 2017, 2018, and 2019. However, on March 25, 2019, the Commissioner sent HISD officials a letter purporting to "clarify" Delaney's powers and duties, including: "[e]nsuring and overseeing district-level support to low-performing campuses within the district"; "[e]nsuring and overseeing the implementation of the district's turnaround efforts to support its low-performing campuses"; "[a]ttending board meetings and overseeing the governance of the district"; and "[s]ubmitting monthly reports, including any special reports requested by the Texas Education Agency." On the same date that the Commissioner notified HISD of Delaney's expanded authority, Delaney sent the following "Conservator Directive" to HISD officials, ordering HISD to temporarily suspend its "Superintendent search activities":

Pursuant to Texas Education Code § 39A.003(c)(1), I am directing the Houston Independent School District Board of Trustees and the administration of the Houston ISD to immediately suspend its Superintendent search activities until theAgency has completed its special accreditation investigation (SAI # INV2019-10-034). I am directing the Houston ISD Board of Trustees to take no further action regarding the selection of a new Superintendent until the Board receives written authorization from the Conservator to resume the search activities.

HISD acknowledges that the Commissioner had authority to appoint Delaney as a campus-level conservator for Kashmere High School. However, in its second and third ultra vires claims, HISD alleges that the Commissioner did not have authority to appoint Delaney as a district-level conservator and that Delaney, consequently, did not have authority to suspend HISD's superintendent search. We agree.

Section 39A.002 of the Education Code provides that the Commissioner may appoint a conservator to oversee the operations of a school district if the district is "subject to commissioner action under Section 39A.001." Tex. Educ. Code § 39A.002(7). A school district is "subject to commissioner action under Section 39A.001" if the district fails to satisfy: (a) certain accreditation criteria, (b) academic performance standards, or (c) any financial accountability standard as determined by commissioner rule. Id. § 39A.001(1). It is undisputed that HISD did not fail to satisfy any of those standards. Accordingly, the Commissioner lacked authority under Section 39A.001 to appoint Delaney to oversee the operations of the entire school district.

Nevertheless, Appellants contend that the Commissioner appointed Delaney not under Section 39A.001 but under Sections 39A.101 and 39A.102, which allow for the appointment of a campus-level conservator if a campus...