Opinion
Civil Action No. 3:03-CV-2450-B.
December 21, 2004
FINDINGS OF FACT AND CONCLUSIONS OF LAW
Plaintiff VRC, L.L.C. brought this action against the City of Dallas, complaining of Dallas City Code Chapter 48A Section 36, as amended ("the Ordinance"), which regulates the signs that must be posted on private property before a nonconsensual tow of a motor vehicle may be performed from that property.
On October 5, 2004, the Court tried this action without a jury. After hearing and considering the testimony and evidence presented by the parties, the Court makes its findings of fact and conclusions of law pursuant to Rule 52(a) of the Federal Rules of Civil Procedure as follows. For clarity, the Court makes its conclusions of law first, and then its findings of fact.
The following findings of fact and conclusions of law were submitted to the Court at the Court's direction by counsel for the City. The Court entered detailed findings of fact and conclusions of law on the record on October 21, 2004, approximately two weeks after the presentation of evidence in this case. The Court has fully reviewed the transcript from October 21, 2004 and finds that the proposed findings and conclusions, but for some adjustments incorporated above, accurately reflect this Court's findings and conclusions.
I. BACKGROUND FACTS
1. The City of Dallas (the "City") is a home-rule city within Dallas County, Texas.
2. VRC, L.L.C. ("VRC") is a Dallas-based towing company that provides nonconsent towing services at various locations within the city of Dallas, Texas.
3. VRC seeks declaratory and injunctive relief against the City based upon the City's enforcement of Dallas City Code Chapter 48A Section 36, an ordinance which imposes requirements for the posting of signs on private property prior to the removal of vehicles from the property. The Ordinance is very specific as to the content, design and location for posting these signs on private property. DALLAS CITY CODE § 48A-36.
4. VRC's complaints, based upon the Amended Pretrial Order, the Complaint itself, and the statements of counsel at the beginning of the bench trial, are three-fold: First, VRC contends that Dallas City Code Chapter 48A Section 36 is preempted by the Federal Aviation Administration Authorization Act, found at 49 U.S.C. § 14501(c)(1), because the Ordinance directly regulates the service of a motor carrier with respect to the transportation of property and is not a motor vehicle safety regulation and does not concern minimal levels of financial responsibility.
5. VRC next contends that even if Chapter 48A Section 36 is not preempted by federal law, VRC's activities are not subject to regulation under the Ordinance because the Ordinance is directed only at nonconsensual towing. VRC contends it performs consent tows when removing vehicles from properties because signs are posted at the entrances and exits of the properties, which notify the vehicle owners as follows (the "consent language"):
"By entering on this property, you consent to being booted or towed at your expense and sole liability for violating the property rules or regulations concerning or relating to vehicles."
The above consent language is not required by the Ordinance, but was added by VRC to the signs that were required by the Ordinance.
6. VRC's third contention is that the City is equitably estopped from subjecting VRC to Chapter 48A Section 36 because "[t]he head of the City Department charged with enforcement of Chapter 48A [Don Bearden] represented to VRC at a deposition that [tows from properties where signs with the consent language were posted] were consensual and not regulated by the Dallas City Code." In reliance on this representation by Mr. Bearden at his deposition, VRC contends that it installed new signs containing the consent language which, based on its understanding of Mr. Bearden's statement, rendered the tows consensual. Therefore, VRC claims that the City is equitably estopped from requiring VRC to comply with Chapter 48A Section 36.
II. CONCLUSIONS OF LAW
A. Preliminary Conclusions
1. The Court has subject-matter jurisdiction over this action pursuant to 28 U.S.C. § 1331 and supplemental jurisdiction over any pendent state law claims.
2. The parties waived a jury and submitted all questions of fact to the Court for determination.
B. Conclusions Relating to Federal Preemption
3. The party asserting preemption bears the burden of persuasion that preemption applies. ATT Corp. v. Pub. Util. Comm'n of Tex., 373 F.3d 641, 645 (5th Cir. 2004).
4. The federal statute at issue, 49 U.S.C. § 14501(c), provides as follows:
(1) General Rule. — Except as provided in paragraphs (2) and (3), a state, political subdivision of a state, or political authority of 2 or more states may not enact or enforce a law, regulation, or other provision having the force and effect of law related to a price, route or service of any motor carrier . . . with respect to the transportation of property.49 U.S.C. § 14501(c)(1) (1997 Supp. 2004). Subpart 2 of paragraph (c) addresses the matters that are not covered by the general preemption paragraph:
(2) Matters not covered. — Paragraph (1) —
(A) shall not restrict the safety regulatory authority of a state with respect to motor vehicles, the authority of a State to impose highway route controls or limitations based on the size or weight of the motor vehicle or the hazardous nature of the cargo, or the authority of a state to regulate motor carriers with regard to minimum amounts of financial responsibility relating to insurance requirements and self-insurance authorization. . . .
5. 49 U.S.C. § 14501 preempts all laws and regulations enacted by a state or political subdivision that relate to a price, route, or service of any motor carrier with respect to the transportation of property. Cole v. City of Dallas, 314 F.3d 730, 733 (5th Cir. 2002). However, 49 U.S.C. § 14501 creates an exception to the general preemption rule by stating that the rule does not restrict the safety regulatory authority of a state with respect to motor vehicles. City of Columbus v. Ours Garage Wrecker Serv., 536 U.S. 424, 428 (2002).
6. The historic police powers of the states are not superseded by federal law unless that was the clear and manifest purpose of Congress. Id. at 432. The purpose of Congress is the ultimate touchstone of the preemption analysis. Cipollone v. Liggett Group, Inc., 505 U.S. 504, 516 (1992). The Supreme Court in Ours Garage noted that Congress' clear purpose in enacting § 14501(c)(2)(A) was to ensure that the statute's preemption of states' economic authority over motor carriers of property not restrict the preexisting and traditional state police power over safety. Ours Garage, 536 U.S. at 439. The Supreme Court further stated that the problem addressed by 49 U.S.C. § 14501 was state economic regulation of motor carriers as opposed to state safety regulation. Id. at 440-441. Thus, the Supreme Court determined that the safety exception to preemption need not be narrowly interpreted. Id. at 440. The Fifth Circuit has characterized the scope of the preemption exception as encompassing all laws and regulations that "do not relate to the slender congressional goal of addressing economic authority over such carriers." Cole, 314 F.3d at 733. In Cole, the Fifth Circuit declined to narrowly interpret the phrase "safety regulatory authority of the state with respect to motor vehicles." Id. at 734.
7. VRC argued that the "safety regulatory authority of the state with respect to motor vehicles" exception to § 14501 only applied to the state's safety authority to regulate the mechanical components of tow trucks. However, the Fifth Circuit has not limited its interpretation of that phrase to only the regulation of the mechanical components of a motor carrier. Id. at 733. Courts that have explicitly addressed whether the safety exception applies only to the mechanical components of the motor carrier have rejected that argument in favor of a broader interpretation of the exception. See Tow Operators Working to Protect Their Right to Operate on the Streets of Kansas City v. City of Kansas, 338 F.3d 873, 876 (8th Cir. 2003); Ace Auto Body Towing, Ltd. v. City of New York, 171 F.3d 765, 774 (2d Cir. 1999). Therefore, the Court concludes that the safety exception of § 14501 permits states to regulate more than just the mechanical components of the motor carrier.
8. In determining whether a law or regulation falls within the safety exception of § 14501, a court must decide whether the law is a safety regulation or an economic regulation. Ace Auto Body, 171 F.3d at 772.
9. In the summary judgment context, once a city has put on evidence of a safety motivation for a challenged ordinance, the courts have typically then required the party asserting preemption to put on evidence or at least make an argument that the challenged law has an economic goal or effect. See, e.g., Tow Operators, 338 F.3d at 876. For example, in Tow Operators, the tow truck companies in that case did not put on any evidence that the ordinance had an ulterior economic motive or effect and were, thus, unable to demonstrate federal preemption. Id. In Cole, the Fifth Circuit noted that the plaintiff had raised no argument pointing the court to a hidden pretextual economic goal behind the challenged ordinance and rejected the plaintiff's preemption argument. Cole, 314 F.3d at 735. These cases can be contrasted with Harris County Wrecker Owners for Equal Opportunity v. City of Houston, 943 F.Supp 711, 732 (S.D. Tex. 1996), where a Southern District of Texas court found that the ordinance was economically motivated after evidence was put on that the city used market factors to limit the number of tow truck permits it issued.
10. In determining whether a city ordinance is safety-related, the court may consider as evidence the preamble and legislative history of the ordinance. Cole, 314 F.3d at 734-35; Galactic Towing, Inc. v. City of Miami Beach, 274 F. Supp. 2d 1315, 1321-22 (S.D. Fla. 2002).
11. If a law, although denoted as safety-related, is in reality an economic regulation, it is preempted. See, e.g., Harris County, 943 F.Supp. at 728. If, however, the challenged law places only an insignificant economic burden on motor carriers, it is not preempted. See Ace Auto Body, 171 F.3d at 776-77; Galactic Towing, 274 F. Supp. 2d at 1319 n. 1.
12. Courts have found the following laws and ordinances to be safety-related in the towing context: Denying permits to individuals with certain recent criminal convictions, requiring a permit or license to perform tows, making it illegal to tow without the written authorization of a property owner, requiring the storage of towed vehicles within the city, and record-keeping and reporting requirements. Cole, 314 F.3d at 730; Ace Auto Body, 171 F.3d at 765; Galactic Towing, 274 F. Supp. 2d at 1319.
C. Conclusions Relating to the Nonconsensual Nature of the Vehicle Tows in Issue
13. VRC's next argument is that the addition of the consent language to the signs required by the Ordinance renders tows from the property consensual. Therefore, according to VRC, the Ordinance does not apply, because Dallas City Code Chapter 48A Section 36 does not apply to consent tows. However, Dallas City Code Chapter 48A Section 36 does not define a consent tow.
14. Black's Law Dictionary defines consent as "a concurrence of wills," "agreement," "acquiescence or compliance." Black's Law Dictionary, 6th ed. 1990.
15. Texas Transportation Code § 643.201(e)(2) defines "consent tow" as "any tow of a motor vehicle initiated by the owner or operator of the vehicle or by a person who has possession, custody or control of the vehicle. The term does not include a tow of a motor vehicle initiated by a peace officer investigating a traffic accident or a traffic incident that involves the vehicle." TEX. TRANSP. CODE ANN. § 643.201(e)(2) (Vernon 1999 Supp. 2004).
16. Texas Transportation Code § 643.201(e)(4) defines "nonconsent tow" as "any tow of a motor vehicle that is not a consent tow." In Stucky v. City of San Antonio, the Fifth Circuit stated in dicta that it would abide by the definitions of consent and nonconsent tows contained in § 643.201(e)(2) and (e)(4) of the Texas Transportation Code. 260 F.3d 424, 434 n. 11 (5th Cir. 2001), vacated by 536 U.S. 936 (2002).
17. The Congressional Record regarding 49 U.S.C. § 14501 states: "Nonconsensual towing situations are those where the owner of the vehicle is unable to consent to it being towed, such as in cases of a severe accident, where the vehicle is towed from a commercial establishment for it being illegally parked, or towed from city streets as a result of a police order." See 141 Cong. Rec. H15600-02 (daily ed. December 22, 1995) (statement of Rep. Rahall).
18. The House Conference Report regarding 49 U.S.C. § 14501 states "Non-consent tows occur when the vehicle owners/operators are unable to give their voluntary consent to the tow. Non-consent tows typically occur in emergency situations and when tows are made from private property." H.R. Conf. Rep. No. 104-422 at 219 (1994), reprinted in 1995 U.S.C.C.A.N. 850, 904.
19. Black's Law Dictionary defines implied consent as consent "manifested by signs, actions, or facts or by inaction or silence, which raise a presumption or inference that consent has been given." Black's Law Dictionary, 6th ed. 1990. The cases relied upon by VRC in their implied consent argument are Machleder v. Diaz, 538 F. Supp. 1364 (S.D.N.Y. 1982), Vantil v. State, 884 S.W.2d 212 (Tex.App.-Fort Worth 1997, no pet.), and Tin Man Lee v. State, 773 S.W.2d 47 (Tex.App.-Houston [1st Dist.] 1989, no pet.). However, none of these cases are either binding or on point, and the Court has been unable to find any cases that squarely address the consent issue presented here.
20. The Machleder court noted that the fact that property owners had not put up signs warning the visitors to stay off property and did not actually tell defendants to leave the property were factors in determining that the owner had impliedly consented to the presence of defendants on the property. 538 F. Supp. at 1375. The consent issue was whether the property owner impliedly consented to the trespass on his property, and the lack of "no trespassing" signs was only a factor the court considered. Id. Machleder is not comparable to this situation here, where VRC requests the Court to find that the presence of signs is determinative of implied consent.
21. The Vantil case dealt with the state penal law regarding criminal mischief, which required the State to prove a lack of "effective consent." 884 S.W.2d at 213. The property owner in that case broke into an illegally parked car to move it. Id. at 214. The State in the case did not put on any evidence regarding lack of consent of the truck owner, and that court refused to sustain the conviction, reasoning that because the truck owner had illegally parked his vehicle to prevent his trailer home from being towed, that he impliedly consented to having his vehicle towed. Id. Again, the situation in Vantil is not similar to this case, because Vantil dealt with penal law and proof beyond a reasonable doubt.
22. In the Tin Man Lee case, a club had posted signs saying that patrons would be searched before entering the club, and the argument was made that the defendant impliedly consented to a pat-down search by voluntarily entering the club. 773 S.W.2d at 48. However, Tin Man Lee was a Fourth Amendment case dealing with police action and Fourth Amendment issues and is distinguishable from what is presented in this case.
23. What can be gleaned from all the cases regarding implied consent is that it is a very fact-intensive inquiry that involves a balancing of the needs and rights of the individual trying to assert implied consent and the needs and rights of the individuals trying to avoid a finding that they impliedly consented to either having their body searched, their bag searched, or their car searched or towed. In order to imply consent, and the Court must have sufficient information to determine that, in fact, individuals did impliedly consent to, in this particular case, having their cars towed. Proof of that proposition must consist of more than the mere fact that signs were posted. See McGann v. Northeast Ill. Reg'l Commuter R.R. Corp., 8 F.3d 1174, 1180-81 (7th Cir. 1993).
D. Conclusions Relating to Equitable Estoppel Against the City
24. The third issue is whether or not the City is equitably estopped from enforcing the Ordinance against VRC based on Mr. Bearden's statements at a deposition in another case in response to questions by Plaintiff's counsel that the addition of the consent language to the signs required by the Ordinance rendered the tows consensual. Because the parties did not agree as to whether state or federal law regarding equitable estoppel applied, the Court has analyzed the issue under both Texas and federal law.
25. Under Texas law, a plaintiff relying upon the doctrine of equitable estoppel must show: (1) a false representation or concealment of a material facts; (2) made with knowledge, actual or constructive, of those facts; (3) with the intention that it should be acted on; (4) to a party without knowledge or means of obtaining knowledge of the facts; (5) which party detrimentally relies on the representation. Johnson Higgins v. Kenneco Energy, Inc., 962 S.W.2d 507, 515-516 (Tex. 1988). In reliance on the representation by Mr. Bearden, VRC contends that it installed new signs containing the consent language, which, based on its understanding of Mr. Bearden's representation, rendered the tows consensual.
26. The burden of proving estoppel and the essential elements thereof is on the party asserting it, and the failure to prove any one or more of the elements is fatal. Barfield v. Howard M. Smith Co., 426 S.W.2d 834, 838 (Tex. 1968).
27. The Texas doctrine of equitable estoppel does not as a rule apply against a unit of government in the exercise of public or governmental functions. Clear Lake City Water Auth. v. Winograd, 695 S.W.2d 632, 640 (Tex.App.-Houston [1st Dist.] 1985, writ ref'd n.r.e.) (citing City of Hutchins v. Prasifka, 450 S.W.2d 829, 835 (Tex. 1970)). However, even in view of the doctrine that estoppel does not as a rule apply against a unit of government, there is an exception that a municipal or quasi-municipal corporation may be estopped if justice, honesty, and fair dealing require it. Id.
28. Under Fifth Circuit authority, the elements of equitable estoppel are, first, that the party to be estopped was aware of the facts; second, that the party to be estopped intended his act or omission to be enacted upon; third, that the party asserting estoppel did not have knowledge of the facts; and fourth, that the party asserting estoppel reasonably relied upon the conduct of the other to his substantial injury. Mangaroo v. Nelson, 864 F.2d 1202, 1204 (5th Cir. 1989). Also, after this showing is made, the claimants must also establish more than mere negligence, delay, inaction, or failure to follow an internal agency guideline. Ingalls Shipbuilding, Inc. v. Director, 976 F.2d 934, 938 (5th Cir. 1992). Further, the cases are replete with references to the fact that in order to establish equitable estoppel against the government, a party must establish affirmative misconduct in addition to the four traditional elements of estoppel. See, e.g., Taylor v. U.S. Treasury Dep't, 127 F.3d 470, 474 (5th Cir. 1997). Affirmative misconduct has been described as an affirmative act or misrepresentation or concealment of a material fact and a high hurdle to meet for parties seeking estoppel. In re DePaolo, 45 F.3d 373, 377 (10th Cir. 1995).
E. Standards for Injunction
29. In connection with its preemption claim, VRC requests a permanent injunction, enjoining the City from enforcing the Ordinance against VRC. To be entitled to a permanent injunction, a party must establish, first, a substantial likelihood of success on the merits; second, a substantial threat of irreparable injury if the injunction is not issued; third, that the threatened injury outweighs any damage the court might cause to the defendant; and fourth, that the injunction will not disserve the public interest. Ruscitto v. Merrill Lynch, Pierce, Fenner Smith, Inc., 777 F. Supp. 1349, 1353 (N.D. Tex. 1991).
III. FINDINGS OF FACT
A. Findings Related to Federal Preemption
1. The parties have not disputed that tow trucks are motor carriers or that Dallas City Code Chapter 48A Section 36 relates to the services provided by motor carriers. Therefore, the Ordinance is preempted by 49 U.S.C. § 14501 unless it falls within the safety-related exception.
2. Mr. Bearden provided credible testimony that Dallas City Code Chapter 48A Section 36 was directed at safety issues related to motor vehicles. Mr. Bearden testified that the posting of notice signs as required by the Ordinance was for the safety and welfare of the citizens of Dallas. More specifically, Mr. Bearden was asked how the posting of notice signs created a safer environment for the citizens of Dallas. Mr. Bearden testified that:
"If there's a vehicle being towed by some wrecker service and a citizen comes out, he gets irate, the driver can simply refer to the sign and tell them that they are under contract to the property owner and the vehicle is being towed for whatever reason it may be."
Mr. Bearden provided further credible testimony concerning altercations between tow truck drivers and the public, including incidents involving gunfire that resulted in bullet holes in tow trucks. Also, Mr. Bearden credibly testified that he, along with members of the Dallas Police Department and the Dallas City Attorney's staff, were personally involved in the drafting of the Ordinance and that these safety concerns were considered. Further, Mr. Bearden testified that it was his belief, as an administrator of the Ordinance, that the requirement of posting signs helps to reduce the likelihood of violent incidents. Mr. Bearden gave examples from his personal knowledge of irate callers whose cars had been towed and how the sign requirement assisted him in calming the situations. Finally, Mr. Bearden credibly testified that informing the public of the location of towed vehicles, as is required by the Ordinance, greatly reduced the load on the police department, freeing them to attend to other calls for service. The Court accepts Mr. Bearden's credible testimony that Dallas City Code Chapter 48A Section 36 is directed at safety issues related to motor vehicles.
3. The Court does not find persuasive VRC's argument regarding the lack of documentary evidence supporting a motor vehicle safety purpose behind the Ordinance. Mr. Bearden testified that there are no studies, tests, or other written documents to support the fact that the Ordinance is safety-related as opposed to economically-motivated. However, Mr. Bearden's experience and anecdotal testimony about the safety-related issues discussed above outweigh the lack of documentary evidence and sufficiently establish the safety-related purpose of the Ordinance.
4. Mr. Bearden did testify that the Ordinance is, in part, a consumer-protection type ordinance. However, in light of all the other testimony by Mr. Bearden and other evidence presented, the Court does not find that this evidence (that the Ordinance may have a consumer protection purpose) outweighs the evidence that it is a safety-driven ordinance. Other than this one reference to consumer-protection by Mr. Bearden, there was no other evidence that indicated that Chapter 48A Section 36 was aimed at the economic regulation of tow truck companies.
5. There was also credible evidence of the safety goal of the Dallas City Code Chapter 48A in the form of the preamble to the ordinance which enacted it. Defendant's Exhibit Number 14, which is a copy of Dallas City Ordinance No. 24175, provides:
"Whereas, the city council believes that the proposed safety-related regulations for nonconsensual tows would promote the public safety of both visitors and residents of the city of Dallas by contributing to a decrease in the potential for confrontation and violence between vehicle owners and the persons who tow their vehicles; a decrease in bodily injury and property damage caused by faulty tow truck vehicles and equipment or by incompetent, negligent, and criminal actions of tow truck operators and drivers; a decrease in the number of false auto theft reports processed by the police department, thereby allowing the police to devote more time to responding to more critical public safety situations; and a decrease in auto theft incidents and an increase in the recovery of stolen autos by allowing the police to more quickly and efficiently determine when a car has been stolen, rather than towed, and take appropriate action."
Defendant's Exhibit 14 at 2-3. The Court notes that the Fifth Circuit relied upon this preamble as an indication of the safety-related nature of another section of the same ordinance. See Cole v. City of Dallas, 314 F.3d 730, 735 (5th Cir. 2002).
6. The Ordinance itself is safety-related, as reflected in the preamble and, again, in the testimony from Mr. Bearden regarding how the requirements regarding signage helped deflect violent incidents between tow truck drivers and people who have had their cars towed. The Court finds no credible evidence that this particular section of the Ordinance was aimed at economic regulation of tow truck companies.
7. There was some evidence of an economic burden placed on VRC by Chapter 48A Section 36. Larry White's testimony was credible as to the expenses incurred by VRC in putting the required signs together. However, weighing against that is the fact that the Ordinance itself does not require the tow truck drivers companies to create and post the signs themselves. The Ordinance does not require any particular person to install the signs, but simply requires that the signs be installed by someone before tows are made. Thus, the property owners could purchase and install the signs instead of VRC. Therefore, to the extent that there is an economic burden on tow truck companies created by the Ordinance, that economic burden is voluntary and does not indicate that the Ordinance is aimed at economic regulation of tow truck companies. Thus, for the reasons stated based on the credible testimony, there is insufficient evidence that Dallas City Code Chapter 48A Section 36 is an economic regulation on its face or in practice.
8. The Court finds insufficient evidence to demonstrate that Dallas City Code Chapter 48A Section 36 is an economic regulation of tow trucks. The credible evidence shows that the Ordinance was motivated by safety concerns and, therefore, is not preempted by 49 U.S.C. § 14501. B. Findings Related to the Nonconsensual Nature of the Vehicle Tows at Issue
9. VRC has contracts to tow for approximately 6,000 properties in the Dallas/Fort Worth area. Each property, based on the testimony of Mr. White, has on average ten towing signs, meaning VRC has approximately 60,000 signs in the Dallas/Fort Worth Metroplex. VRC seeks a declaratory judgment that tows made from properties where the consent language is posted are consent tows and not subject to the Ordinance.
10. There is no definition that is set forth by the Fifth Circuit or the Dallas City Code that is binding authority defining consent and nonconsent tows. If this Court is to assume that the Texas Transportation Code that is relied upon by the Fifth Circuit in the Stucky case governs, then the tows at issue here in this case are not consent tows because there is no evidence that the car owners or vehicle owners or possessors initiate the tows. So, under the Texas Transportation Code, the tows at issue here would not be consent tows even with the consent language on the sign.
11. VRC attempts to rely on Mr. Bearden's deposition testimony in another case where he stated his belief that a tow from a property with a sign containing the consent language would be a consent tow. However, Mr. Bearden is not a policymaker, and he had no permission, based on the credible testimony, to abrogate the City's policy or the Ordinance. Mr. Bearden did have a position of authority in the City with regard to Chapter 48A Section 36 and did have some authority to enforce the particular provision and help promulgate Chapter 48. However, his statement regarding whether tows from lots where the consent language was posted were consensual was in response to a question in an adversarial setting at a deposition in another case. He statement did not constitute City policy and could not render tows from 6,000 different properties with VRC's signs containing the consent language to be consent tows.
12. In response to questioning by this Court, Mr. White stated his belief that all tows are consensual unless initiated by a police officer at the scene of an accident. Mr. White's definition of consent is inconsistent with the definitions detailed above from the Texas Transportation Code and the Congressional Record. Not only that, but Mr. White's definition on the witness stand of consensual tows would conflict with the position VRC has taken in this litigation. VRC has contended throughout this litigation that by adding the consent language to the signs required by the Ordinance, an otherwise nonconsensual tow becomes consensual. Mr. White's position is that private property tows are consensual regardless of the language on the sign. Thus, Mr. White's proposed definition and VRC's arguments are in conflict. The Court finds that this renders Mr. White's testimony regarding the definition of a consent tow somewhat lacking in credibility.
13. Thus, what VRC must rely upon is implied consent because there was no evidence presented that any vehicle owners in any way overtly and affirmatively consented to tows from lots where the consent language was posted. VRC relies on the consent language contained in their signs to prove that the vehicle owners impliedly consent to have their vehicles towed.
14. The Court finds no credible evidence that any of the vehicle owners who park on the 6,000 properties where VRC tows actually have seen any of these signs. There was testimony that these signs are required to be displayed in a certain way and that they are arguably posted at the entrances and exits of each of these properties. However, even if the Court accepts the fact that signs with the consent language are posted at the entrances and exits of all these properties, that is insufficient proof for the Court to find that the individuals who park on these 6,000 properties impliedly consent to their vehicles being towed.
15. Further, there was no credible evidence that the signs are actually in a place where people would all agree they are clearly visible at night and during the day. There was no such testimony for even one of the properties, let alone all 6,000. Rather, there was very broad-based, somewhat vague testimony, regarding the location and visibility of VRC's signs, but no other supporting testimony on that point.
16. It is clear to the Court that VRC's view is that the drivers of these automobiles from the 6,000 properties at issue here impliedly consented to having their cars towed by parking in these lots with VRC's signs. That view hinges and absolutely is founded upon a finding that these individuals who park in these lots actually see the signs. VRC's arguments and the testimony during the trial established that VRC must, in fact, demonstrate in some fashion, even if circumstantially, that the individuals whose cars are being towed from these lots and who VRC is claiming impliedly consented to these tows had notice of the potential of the tows by virtue of seeing the signs.
17. Under the circumstances here, for the reasons stated, there is insufficient proof that VRC has met its burden of establishing that the addition of the consent language to the signs required by the Ordinance renders tows from those properties consent as opposed to nonconsent tows. Therefore, the Court will not enter the declaratory judgment requested by VRC.
C. Findings Related to Equitable Estoppel Against the City
18. VRC's final argument is that the City is equitably estopped from enforcing the Ordinance against it because Mr. Bearden indicated in a deposition in another case that tows from properties where the consent language was posted would be consensual. Even assuming that VRC does not have to prove that Mr. Bearden made the statement — and assuming for purposes of argument that he made the statement that the tows would be consensual with the knowledge of the true facts — another element of estoppel, that he made it with the intention that it should be acted on, was simply not proven in this case. The testimony from Mr. Bearden during the course of this trial with regard to his responses to those questions is extremely vague with regard to what he actually intended or what he actually meant. The reasonable inference that can be drawn from the way Mr. Bearden explained that testimony in this trial is that he made a mistake, and he was responding to a question in an adversarial proceeding by a lawyer from VRC. There is nothing in the record to indicate that he in any way intended that VRC should rely on his statement and go out and spend money and make the signs, nor can it be reasonably inferred from the facts surrounding his testimony at trial and the way his testimony at the deposition has been described and proven. Therefore, the Texas elements of equitable estoppel have not been established.
19. Putting aside the basic elements to prove equitable estoppel, there is the general principle that the estoppel does not, as a rule, apply against a unit of government, which is the case here. There is an exception that estoppel may be applied if justice, honesty and fair dealing require it. The Court concludes that there has not been any indication or proof or evidence by VRC that justice, honesty, and fair dealing require that the City be estopped under the circumstances here. Again, Mr. Bearden's testimony arose during an adversarial proceeding in which Mr. Bearden was not testifying as a Rule 30(b)(6) representative of the City. But even assuming that he was a 30(b)(6) witness, it was a hypothetical question posed to Mr. Bearden by the attorney for VRC. The question was not asked directly of Mr. Bearden seeking permission by Mr. White or one of his counterparts at VRC; rather, it was a question by the lawyer in an adversarial proceeding at a deposition. The context in which the exchange occurred, the way the question was asked, and the person that asked it all militate in favor of finding that this exception not apply. In other words, even assuming all the elements of equitable estoppel under Texas law have been established, the rule that estoppel not apply against a unit of government should be applied in this case because there has been no indication that justice, honesty, and fair dealing require that the City be estopped. So, under Texas law VRC has not established its entitlement to equitable estoppel against the City.
20. Under the federal standards for application of equitable estoppel, VRC's proof again falls short. With respect to the second element, which is similar to the Texas element, that the party to be estopped intended his act or omission to be acted upon, it has not been established for the same reasons it was not established under the Texas authority. It was not established that Mr. Bearden, responding to a question by VRC's attorney during deposition where it was presented to him in a hypothetical fashion, intended his response to be acted upon by VRC. And again, even assuming all of those elements have been shown, federal law still requires a showing that the act itself was more than mere negligence, delay, inaction, or failure to follow an internal agency guideline. Based upon Mr. Bearden's testimony, at best the credible evidence establishes that Mr. Bearden's statement was just negligent. For all of those reasons, the elements of equitable estoppel under Fifth Circuit or Texas authority have been met. Therefore, VRC is not entitled to application of the doctrine of equitable estoppel against the City.
D. Findings Regarding Injunctions
21. Because there is insufficient evidence to establish VRC's claims in this case, VRC cannot meet its burden of establishing that there is a substantial likelihood of success on the merits in this particular case. Therefore, VRC is not entitled to injunctive relief.
III. CONCLUSION
For the reasons stated above, the Court concludes that Dallas City Code Chapter 48A Section 36 is not preempted by the Federal Aviation Administration Authorization Act at 49 U.S.C. § 14501(c)(1), the addition of the consent language to the signs required by the Ordinance does not automatically render a tow consensual, and the City is not estopped from requiring VRC to comply with Chapter 48A Section 36. Therefore, VRC is not entitled to declaratory or injunctive relief against the City based upon the City's enforcement of Dallas City Code Chapter 48A Section 36. A final judgment incorporating these findings and conclusions shall be entered forthwith.SO ORDERED.