Justia Texas Supreme Court Opinion SummariesArticles Posted in Class Action
Robinson v. Home Owners Management Enterprises, Inc.
The Supreme Court affirmed the decision of the court of appeals affirming the judgment of the trial court declining to compel arbitration of class claims under the parties' agreement in this case, holding that the lower courts applied the correct legal standards in declining to compel class arbitration.This arbitration dispute between homeowners and their home warranty company evolved into a putative class action complaining about releases the warranty allegedly demanded before making covered repairs. Plaintiffs demanded arbitration, asserting that Defendant was required to arbitrate the class claims under the arbitration provisions in the warranty. The trial court granted Defendant's motion to dismiss, concluding that the question of whether the parties agreed to class arbitration was a question of arbitrability for the court to make and that the warranty agreement did not permit class arbitration. The court of appeals affirmed. The Supreme Court affirmed, holding (1) arbitratibility of class claims is a gateway issue for the court unless the arbitration agreement clearly and unmistakably expresses a contrary intent; (2) an agreement to arbitrate class claims cannot be inferred from silence or ambiguity, but rather, an express contractual basis is required; and (3) the lower courts correctly determined that Defendant was not bound to arbitrate Plaintiffs' putative class claims. View "Robinson v. Home Owners Management Enterprises, Inc." on Justia Law
Garcia v. City of Willis
The Supreme Court affirmed the judgment of the court of appeals reversing the judgment of the trial court concluding that Petitioner, who represented a putative class of citizens seeking to strike down state statutes and a city's ordinance authorizing use of red-light cameras as a traffic-enforcement tool, was not required to seek an administrative remedy before filing his case in district court, holding that Petitioner lacked standing to bring one of his claims, that governmental immunity applied to another claim, and that Petitioner was required to seek administrative relief before filing a takings claim in district court.In reversing, the court of appeals concluded that the trial court had no jurisdiction over Petitioner's claims because Petitioner had failed to seek administrative relief. The Supreme Court affirmed but for different reasons, holding (1) Petitioner lacked standing to bring his prospective claims for declaratory and injunctive relief; (2) governmental immunity barred Petitioner's reimbursement claim; (3) Petitioner was required to exhaust his administrative remedies before bringing his constitutional takings claim in district court; and (4) an amended pleading would not cure the defects in Petitioner's claims. View "Garcia v. City of Willis" on Justia Law
Highland Homes Ltd. v. State
Two subcontractors employed by Petitioner, a homebuilder, asserted claims on behalf of a class of subcontractors whose pay Petitioner had docked when the subcontractors did not furnish proof of adequate general liability insurance coverage. The parties settled. Under the terms of the settlement agreement, Petitioner would issue refunds checks, sending them to existing subcontractors as it would their paychecks or by mailing checks to the last known addresses of former subcontractors. The class representatives agreed, on behalf of the settlement class members, that refund checks not negotiated within ninety days of issuance would be void and that those and other unclaimed funds would be given to The Nature Conservancy as a cy pres award. The trial court approved the settlement and rendered final judgment accordingly. The court of appeals reversed, concluding that the Texas Unclaimed Property Act prohibited the imposition of a ninety-day deadline for negotiating settlement checks and the cy pres award. The Supreme Court reversed, holding that the Act did not apply in this case and that the judgment approving the settlement agreement was binding on all settlement class members. View "Highland Homes Ltd. v. State" on Justia Law
Phillips Petroleum Co. v. Yarbrough
This suit was filed as a putative class action on behalf of Texas royalty owners alleging that Phillips Petroleum Company underpaid oil and gas royalties. The trial court certified three subclasses of royalty owners. The court of appeals reversed. The Supreme Court affirmed as to two of the subclasses but reversed as to the third subclass, which alleged breach of a uniform express royalty provision contained in gas royalty agreements that amended the class members' leases. On remand, Respondent, class representative of the remaining subclass, amended her petition to add a claim for breach of the implied covenant to market. Phillips unsuccessfully filed various motions contending that there was no class claim for breach of the implied covenant to market. The court of appeals dismissed Phillips' interlocutory appeal for lack of jurisdiction and denied Phillips' petition for writ of mandamus. The Supreme Court reversed, holding (1) the court of appeals erred in dismissing the interlocutory appeal for lack of jurisdiction; and (2) the trial court abused its discretion in allowing the addition of a class claim for breach of the implied covenant to market without requiring Respondent to file an amended motion for class certification or holding a certification hearing. View "Phillips Petroleum Co. v. Yarbrough" on Justia Law
Riemer v. State
A small group of landowners sought to certify a class composed of all owners of any real property interests in a twelve-mile stretch of land located adjacent to the Canadian River to litigate alleged takings claims against the State. The trial court denied certification, finding that the landowners failed to satisfy two prerequisites required by Tex. R. Civ. P. 42(a) and any one of the three Rule 42(b) requirements. The court of appeals affirmed, concluding that certain conflicts identified by the trial court prevented the landowners from satisfying Rule 42(a)(4)'s adequacy-of-representation prerequisite. The Supreme Court reversed, holding (1) the trial court abused its discretion by relying on the conflicts identified in its order denying class certification to establish that the landowners failed to satisfy Rule 42(a)(4)'s adequacy-of-representation prerequisite; and (2) the court of appeals erred when it affirmed the trial court's order on the same grounds. View "Riemer v. State" on Justia Law
City of Dallas v. Martin, et al.
This matter arose out of a dispute over whether the City of Dallas paid its firefighters and police officers in accord with a 1979 ordinance adopted pursuant to a voter-approved referendum. Claiming the City had not properly paid them, some firefighters and police officers brought a class action asserting breach of contract claims and seeking a declaratory judgment. For the reasons set out in City of Dallas v. Albert, the court concluded that: (1) the ordinance's adoption by means of referendum did not result in the City's loss of immunity from suit; (2) the City had immunity from suit as to the declaratory judgment action; (3) by non-suiting its counterclaim the City did not reinstate immunity from suit as to the Officers' claims that were pending against the City when it non-suited the counterclaim; and (4) the case must be remanded for the trial court to consider whether the Legislature waived the City's immunity by amending the Local Government Code. View "City of Dallas v. Martin, et al." on Justia Law
Ojo, et al. v. Farmers Group, Inc., et al.
Appellant, an African-American resident of Texas, sued appellees alleging that their credit-scoring systems employed several undisclosed factors which resulted in disparate impacts for minorities and violated the federal Fair Housing Act ("FHA"), 42 U.S.C. 3601, 3619. At issue, in a certified question, was whether Texas law permitted an insurance company to price insurance by using a credit-score factor that had a racially disparate impact that, were it not for the McCarran-Ferguson Act, 15 U.S.C. 1012(b), would violate the FHA, absent a legally sufficient nondiscriminatory reason, or would using such a credit-score factor violate Texas Insurance Code ("Code") sections 544.002(a), 559.051, 559.052, or some other provision of Texas law. The court answered the certified question by holding that Texas law did not prohibit an insurer from using race-neutral factors in credit-scoring to price insurance, even if doing so created a racially disparate impact.