City of Willis v. Garcia (523 S.W.3d 729, 2017)

OPINION

LEANNE JOHNSON, Justice

This is an accelerated appeal of an interlocutory order denying a plea to the jurisdiction. See Tex. Civ. Prac. & Rem. Code Ann. § 51.014(a)(8) (West Supp. 2016); Tex. R. App. P. 28.1(a). Appellants, the City of Willis (the City), Leonard Reed in his official capacity as Mayor of the City, James Nowak in his official capacity as Chief of Police of the City, and Hector Forestier in his official capacity as City Manager of the City, in one issue contend that the trial court erred in denying.their plea to the jurisdiction. Appellants argue that the plaintiffs failed to exhaust administrative remedies and the plaintiffs’ claims are barred by governmental immunity.

The underlying lawsuit was originally filed on January 11, 2016, by Luis Garcia, on behalf of himself and “others similarly situated” who have paid a civil penalty for violating the City’s Ordinances sections 70.01 through 70.12 (enacted by the.passage of Ordinance No. 09-0721A and hereinafter referred to as the “Red Light .Camera Ordinance”) that authorized and created.,a photographic-traffic signal-enforcement system in Willis. Luis Garcia, joined by Shelby D. Glazier, Alisa Davie, and Debra Earle (collectively Plaintiffs or Appellees), later filed a First Amended Original Petition, on behalf of themselves and again as proposed putative class representatives for those who are similarly situated registered automobile owners who have paid a civil penalty for violating the City’s Red Light Camera Ordinance. Plaintiffs sought injunctive relief, declaratory relief, a refund of penalties paid or, alternatively, damages for inverse condemnation, certification of a class, appointment of attorneys to act as class counsel, and attorney’s fees. Plaintiffs’ suit specifically challenges the constitutionality of the City’s Red Light Camera Ordinance, Chapter 707 of the Texas Transportation Code, and section 29.003(g) of the Texas Government Code. Additionally, the Plaintiffs allege that the City failed to meet the requirements of the City’s Red Light Camera Ordinance and Chapter 707 of the Texas Transportation Code because the City allegedly failed to conduct a traffic engineering study as required before installing the cameras.

The Defendants filed an answer and asserted a general denial: The Defendants challenge jurisdiction arguing the Plaintiffs’ claims are barred by governmental immunity, official immunity, failure to exhaust administrative remedies, res judicata and collateral estoppel, and that exclusive jurisdiction rests in the municipal court.

The Defendants filed a joint Plea to the Jurisdiction arguing that the trial court lacked subject matter jurisdiction over the Plaintiffs’ claims. The Plaintiffs filed a response. The Plaintiffs argued in them response that they were seeking “declaratory relief and injunctive relief that Chapter 707 and the [City’s Red Light Camera] Ordinance, which was enacted under the authority of Chapter 707, and Texas Government Code Section 29.003(g), are unconstitutional, and therefore illegal, void and of no effect.” The Plaintiffs also asserted that they filed a “common law claim for reimbursement of the unconstitutional, and hence, unlawful red- light camera penalties involved in this lawsuit.... [as well as] a takings claim under Article I, Section 17 of the Texas Constitution for reimbursement of the unlawful and illegal -red light camera penalties involved in this lawsuit.” The Plaintiffs further alleged that the failure of the City to conduct the required traffic engineering study precludes the City from assessing and collecting the fines. The Plaintiffs contend that their “claims for declaratory judgment and in-junctive relief, and reimbursement of the unlawful red light camera penalties involved in this lawsuit, based on Defendants assessing and collecting red light camera penalties in violation of the law, are not claims subject to the exhaustion of remedies defense asserted by Defendants.”

The trial court denied Appellants’ Plea to the Jurisdiction, and this interlocutory appeal followed. We reverse and render judgment for the Defendants.

Red Light Camera Statutes

In 2007, the Texas Legislature passed Senate Bill No. 1119, which was codified in Chapter 707 of the Texas Transportation Code, effective September 1, 2007. See Act of May 27, 2007, 80th Leg., R.S., Ch. 1149, §§ 1, 10, 2007 Tex. Gen. Laws 3924, 3931 (current version at Tex. Transp. Code Ann. § 707.001-.019 (West 2011 & Supp. 2016)). The Legislature also amended section 29.003 of the Texas Government, Code, adding subsection (g). See Act of May 27, 2007, 80th Leg., R.S., Ch. 1149, § 3, 2007 Tex. Gen. Laws 3924, 3930 (current version at Tex. Gov’t Code Ann. § 29.003(g)). Subsection (g) provides that “[a] municipal court, including a municipal court of record, shall have exclusive appellate jurisdiction within the municipality’s- territorial limits in a case arising under Chapter 707, Transportation Code.” Id.

Chapter 707 authorizes local municipalities to adopt and implement a camera enforcement system that imposes civil fines on owners of vehicles that have been photographed driving through red lights at designated intersections. See Tex. Transp. Code Ann. § 707.001-.019.

Section 707.003 of the Texas Transportation Code provides as follows:

Sec. 707.003. Installation and Operation of Photographic Traffic Signal Enforcement System.

(a) A local authority that implements a photographic traffic signal enforcement system under this chapter.may:

(1) contract for the administration and enforcement of the system; and

(2) install and operate the system or contract for the installation or operation of the system.

(b) A local authority that contracts for the administration and enforcement of a photographic traffic signal enforcement system may not agree to pay the contractor a specified percentage of, or dollar amount from, each civil penalty collected.

(c) Before -installing a photographic traffic signal enforcement system at an intersection approach, the local authority shall conduct a traffic engineering study of the approach to determine whether, in addition to or as an alternative to the system, a design change to the approach or a change in the signalization of the intersection is likely to reduce the number of red light violations at the intersection.

(d) An intersection approach must be selected for the installation of a photographic traffic signal enforcement system based on traffic volume, the history of accidents at the approach, the number or frequency of red light violations at the intersection, and similar traffic engineering and safety criteria, without regard to the ethnic or socioeconomic characteristics of the area in which the approach is located.

(e) A local authority shall report results of the traffic engineering study required by Subsection (c) to a citizen advisory committee consisting of one person appointed by each member of the governing body of the local authority. The committee shall advise the local authority on the installation and operation of a photographic traffic signal enforcement system established under this chapter.

(f) A local authority may not impose a civil penalty under this chapter on the owner of a motor vehicle if the local authority violates Subsection (b) or (c).

(g) The local authority shall install sigh's along each roadway that leads to an intersection at which a photographic traffic signal enforcement system is in active use. The signs must be at least 100 feet from the intersection or located according to standards established in the manual adopted by the Texas Transportation Commission under Section 544.001, be easily readable to any operator approaching the intersection, and clearly indicate the presence of a photographic monitoring system that records violations that may result in the issuance of a notice of violation and the imposition of a monetary penalty.

(h)A local authority or the person with which the local authority contracts for the administration and enforcement of a photographic traffic signal enforcement system may not provide information about a civil penalty imposed under this chapter to a credit bureau, as defined by Section 392.001, Finance Code.

Id. at § 707.003.

The City’s Red Light Camera Ordinance

On July 21, 2009, the City of Willis enacted Ordinance No. 09-0721A, wherein the City adopted a red light camera enforcement system for the City for three intersections within the City limits. Willis, Tex., Code of Ordinances ch. 70. The City’s Red Light Camera Ordinance provides that the owner of a motor vehicle that runs a red light is liable for a civil penalty of $75, and if payment is late, an additional penalty of $25. Id, § ‘70.04. The notice of violation is to be mailed tc¡ the owner of the vehicle at the- address indicated on the state’s registration records not later than the thirtieth day after the violation is alleged to have occurred. Id. § 70.05(B). The notice shall contain (1) a description of the violation alleged; (2) the location of the intersection where the violation occurred; (3) the date and time of the violation; (4) the name and address of the owner of the vehicle involved in the violation; (5) the registration number displayed on the vehicle’s license plate; (6) a copy of the recorded image of the area of the license plate where the registration number appears for the vehicle involved in the violation; (7) the amount of civil penalty for which the owner is liable; (8) the number of days that the person has within which to either pay or contest the imposition of the civil penalty as well as a statement that the person incurs a late payment penalty of $25 if the civil penalty is not paid or if the person does not contest the imposition of the civil penalty; (9) a statement that the owner of the vehicle in the notice of violation may elect to pay,the civil penalty by mail instead of appearing at the time and place of the administrative adjudication hearing; and (10) information that informs the vehicle owner named in the violation:

(a) Of the owner’s right to contest the imposition of the civil penalty in an administrative adjudication hearing;

(b) That the imposition of the civil penalty may be contested by: submitting a written request for an administrative adjudication hearing before the expiration of the deadline for payment of the civil penalty;

(c) That failure to pay the civil penalty or timely contest liability for the penalty in a timely manner is an admission of liability and a waiver of the owner’s right to appeal the imposition of the civil penalty; and

(d) That if the owner of the motor vehicle fails to timely pay the amount of the civil penalty imposed against the owner:

1. An arrest warrant will not be issued for the owner, and

2. The imposition of the civil penalty will not be recorded on the owner’s driving record.

Id. § 70.05(C).

The City’s Red Light Camera Ordinance provides that failure to pay the civil penalty, or to timely contest liability for. the penalty, or failure to appear at the administrative hearing after requesting one, results in the owner of the vehicle being considered to have admitted liability for the full amount of the civil penalty and to have waived the owner’s right to appeal the imposition- of the civil penalty. Id, § .70.06. The City’s Red,Light Camera Ordinance authorizes the City to direct the Montgomery County Tax Assessor and the Texas Department of Transportation to refuse. to register a motor, vehicle alleged to have been involved in a violation if the owner of the vehicle is delinquent in the payment of the civil '.penalty. Id. § 70.05(F). The City’s Red Light Camera Ordinance also provides, for an administrative adjudication hearing to contest, the imposition of the civil penalty. .Id. § 70,09. At the conclusion of an administrative adjudication hearing, the hearing officer shall enter either a finding of liability for the civil penalty or a finding of no liability for the civil penalty. A finding under this subsection must be. in writing and be signed and dated by the hearing officer. Id. § 70.09(G).

The City’s Red Light Camera Ordinance also provides a procedure for an appeal from the administrative adjudication hearing, allowing an appeal from the hearing officer’s determination of liability to be taken to. the City’s municipal court. Id. § 70.11, The appeal must be filed before the thirty-first day after the date on which the administrative adjudication hearing officer entered the finding of liability for the civil penalty, and must be accompanied by payment of the costs required by law for the court. Id. § 70.11(B). An appeal stays enforcement and collection of the civil penalty imposed against the owner of the motor vehicle. Id. § 70.11(D). The municipal court then determines the appeal by trial de novo. Id. § 70.11(C), (E). Any person who is found liable for a civil penalty after an appeal hearing shall pay the civil penalty within ten days of the hearing. Id. § 70.11(F).

The City’s Red Light Camera Ordinance also provides (i) that the imposition of a civil penalty under the ordinance is not a criminal conviction, (ii) that information concerning a civil penalty cannot be provided to a credit bureau, (iii) that failure to pay the civil penalty does not result in an arrest warrant and is not recorded on the owner’s driving record; however, (iv) the city attorney is authorized to file suit to enforce collection of the civil penalty. Id. § 70.12.

Under section 707.014(h), if a person is found liable for violating a red light camera ordinance, the finding of liability “must specify the amount of the civil penalty for which the person is liable.” Tex. Transp. Code Ann. § 707.014(h) (West 2011). The owner’s failure to either pay the civil penalty or to timely contest liability constitutes a conclusive admission of liability and waives the owner’s right to appeal to municipal court. Id. §§ 707.012, 707.016(a)(2) (West 2011). The City’s Red Light Camera Ordinance incorporates the administrative procedure outlined in Chapter 707, including an administrative adjudication hearing if the owner of the vehicle challenges the imposition of the civil penalty, and it expressly provides for an appeal to the municipal court. See id. §§ 707.014, 707.016 (West 2011).

Allegations Made by Plaintiffs

Plaintiffs allege in their First Amended Petition as follows:

8.

This is an action under the Uniform Declaratory Judgment Act (Chapter 37.001 et. seq. of the Civil Practice and Remedies Code) to declare Chapter 707 of the Texas Transportation Code (hereinafter referred to as “Chapter 707”) and Ordinance 09-[0]721A of the City of Willis, passed July 21, 2009, enacting Willis Ordinances Sections 70.01 through 70.12 (hereinafter “the Ordinance”), unconstitutional under the Texas Constitution. In the alternative, this action further seeks declaratory judgment that Defendants Nowak, Reed and Forestier, acting in their official capacities with the City of Willis, either singularly or in combination, have authorized and permitted the installation and operation of red light camera systems in the City of Willis in violation of Chapter 707 and the Ordinance, and in their official capacities, have caused the issuance of Notices of Violation and collection of fines therefrom which are invalid, unlawful, illegal, void, of no effect and/or unauthorized because of the Defendants’ failure to comply with the traffic engineering study requirement imposed by Section 707.003(c) of the Texas Transportation Code and/or Willis ordinance Section 70.03(A) necessary to allow the City of Willis and the other Defendants to assess and collect a red light camera penalty.

9.

This suit also seeks an injunction against Defendants from operating any red light camera systems and from attempting to enforce any alleged red light camera violations entirely, because of the unconstitutionality of Chapter 707 and the Ordinance, or alternatively, in the unlikely event that Chapter 707 and the Ordinance are found constitutional, to have Defendants enjoined from operating and enforcing any red light camera penalties unless and until they have complied with the traffic engineering study requirement necessary under Chapter 707 and the Ordinance to allow the assessment and collection of a red light camera penalty.

10.

Additionally, Plaintiffs, who have received and paid any such unlawful red light camera penalties/fines assessed by the City of Wilhs and/or any of the other Defendants, either singularly [or] in combination, pursuant to the City of Willis’ illegal red light camera enforcement system, seek the refund of all of the red light camera fines illegally assessed and appropriated by Defendants. Alternatively, Plaintiffs, who have received and paid any such unlawful red light camera penalties/fines assessed by the City of Wilhs and/or any of the other Defendants; either singularly [or] in combination, pursuant to the City of Wilhs’ illegal red light camera enforcement system, seek, as the remedy afforded them under Article I, Section 17 of the Texas Constitution; the refund of all of the red light camera penalties/fines illegally assessed and appropriated by Defendants. Plaintiff estimates that the amount in controversy for these claims, exclusive of interest and costs, is over $1,000,000 but less than $5,000,000.

Appellees admit in their First Amended Petition that each of them received notices of violation for allegedly running a red light. According to Appellees, they were notified that the civil penalty for such violation was $75.00, and that a late fee of $25.00 would be taxed against them if the civil penalty was not paid timely. The Ap-pellees contend that they paid the civil penalty pursuant to the notice of violation, and they allege that they paid such amounts under duress due to “the possible threat of damage to his or her credit, harassment from a collection agency, and the loss of the right to renew his or her vehicle registration^]”

According to the appellate record, none of "the Plaintiffs filed a written request for an administrative adjudication hearing to contest the imposition of the civil penalty as permitted by section 70.09 of the City’s Red Light Camera Ordinance, none of them received a finding of liability by an administrative adjudication hearing officer, and none of them filed an appeal with the clerk of the City’s municipal court. See Willis, Tex., Code of Ordinances § 70.11.

The Plaintiffs argue that: (1) the City’s Ordinance and the statute upon which it is based are both unconstitutional in violation of Article I, Section 10 of the Texas Constitution because the ordinance and statute violate their “right against self[-]incrimin"átion, the right to confront (i.e., cross-examine) the witnesses against him, [ ] the right to a presumption of innocence, and a requirement that the State (or city in this case) prove their case beyond a reasonable doubt[;]” (2) “Chapter 707 and the [Red Light Camera] Ordinance also violate the right to due process guaranteed under Article I, Section 19 of the Texas Constitution .;. by creating an irrebutable presumption against the registered owner of a vehicle like Plaintiffs[;]” (3) they were denied “the right to a trial by jury” in'violation of Article I, Section 10 of the Texas Constitution, and that “Chapter 707 and the [Red Light Camera] Ordinance are also void, in that such violate the open courts provision of Article I, Section 13 of the Texas Constitution^]” and (4) Section 29.003(g) of the Texas Government Code violates Article V, Sections 3 and 6 of the Texas Constitution, as these provisions of the Texas Constitution confer courts of appeal with appellate jurisdiction within the limits of their respective districts.

Plea to the Jurisdiction

Defendants filed a joint Plea to the Jurisdiction. In the plea to the jurisdiction, the Defendants argued that “Plaintiffs’ suit is an impermissible collateral attack on proceedings within the exclusive appellate jurisdiction of the municipal court[ ]” and that the “Plaintiffs failed to exhaust the administrative remedies” provided by the City’s Red Light Camera Ordinance and Chapter 707 of the Texas Transportation Code. Defendants also argued that the “Plaintiffs’ takings claims, and their request for a refund, should be dismissed for want of jurisdiction.”

Plaintiffs’ Response to the Plea to'the Jurisdiction

The Plaintiffs filed a response to the plea to jurisdiction and therein argued that the “so called” administrative remedies did not have to be exhausted because (1) claims for declaratory and injunctive relief that the Red Light Camera Ordinance and Chapter 707 are unconstitutional would not require exhaustion, (2) claims for a refund due to the unconstitutional nature of the statute do . not require exhaustion,. (3) claims, for declaratory and injunctive relief that the City officials acted in an ultra vires manner .in collecting fees without first obtaining a.traffic engineering study do not require exhaustion, and (4) claims for reimbursement due to the ultra vires actions of the City officials in collecting fees without first obtaining a traffic engineering study do not require exhaustion. Plaintiffs further argued various exceptions to the exhaustion requirement.

The Plaintiffs attached Exhibit A to their response which included a business records affidavit and records from the Texas- Board of Professional Engineers. According