Opinion
No. 05-09-01469-CV
Opinion issued July 14, 2010.
On Appeal from the 101st Judicial District Court, Dallas County, Texas, Trial Court Cause No. 09-14234.
Before Justices BRIDGES, FITZGERALD and FILLMORE.
MEMORANDUM OPINION
Appellant Texas Department of Family and Protective Services (the "Department") appeals from the trial court's decision to deny its plea to the jurisdiction and order granting appellee ASI Gymnastics, Inc.'s ("ASI") application for temporary injunction. We reverse the judgment of the trial court and render judgment in favor of the Department.
Background
ASI filed a petition for declaratory judgment and application for injunctive relief against the State of Texas and the Department, contending ASI was not a day care facility subject to State licensing requirements. Specifically, ASI contended that chapter 42 of the Texas Human Resources Code was amended effective September 1, 2009 and, under the new law, ASI's programs were no longer required to be licensed by the State.
The State of Texas is not a party to this appeal.
At one time, ASI held licenses issued by the Department for some of its programs. As a part of the licensing requirements, representatives of the Department would periodically enter ASI facilities for inspection. ASI claimed it abandoned those programs in May of 2009 and launched new programs that were not subject to the licensing requirements on September 1, 2009.
However, ASI alleged the Department (1) continued to issue citations for non-compliance with day care licenses held by programs ASI abandoned, (2) threatened ASI employees with criminal prosecution, and (3) might post negative information about ASI on its website.
ASI obtained injunctive relief, prohibiting the Department from (1) entering any ASI facility for purposes of determining whether ASI is compliant with licensing requirements, (2) threatening any ASI employee with criminal prosecution, or (3) posting or continuing to post on any government website a message that ASI is non-compliant with the licensing law.
The Department filed a plea to the jurisdiction, alleging it had not waived sovereign immunity. Following a hearing, the trial court sent a letter indicating it was denying the plea to the jurisdiction and granting ASI injunctive relief. The order signed by the trial court granted the temporary injunction, but did not specifically address the plea to the jurisdiction. This appeal ensued.
The grant of the injunctive relief serves as an implicit denial of the plea to the jurisdiction. Furthermore, the trial court stated its intention of denying the Department's plea to the jurisdiction in its November 16, 2009 letter to the parties, along with its intent to grant injunctive relief to ASI.
Analysis
The Department raises four issues on appeal. First, it contends the declaratory and injunctive relief sought by ASI was a suit to control state action and, therefore, was barred by sovereign immunity. Second, the Department argues the declaratory and injunctive relief sought by ASI was barred by sovereign immunity because the Department had exclusive jurisdiction to initially determine ASI's claims. Third, the Department alleges the declaratory and injunctive relief sought by ASI was barred by sovereign immunity because ASI had not complied with the jurisdictional prerequisite of exhausting its administrative remedies. Finally, the Department contends the order granting the temporary injunction was an abuse of discretion by the trial court.
We first address the Department's second issue, whether it had exclusive jurisdiction to initially determine ASI's claims. Whether an agency has exclusive jurisdiction is a matter of law subject to de novo review. In re Sw. Bell Tel. Co., L.P., 235 S.W.3d 619, 625 (Tex. 2007) (orig. proceeding).
We presume that district courts are authorized to resolve disputes unless the constitution or other law conveys exclusive jurisdiction on another court or administrative agency. Id. at 624; In re Entergy Corp., 142 S.W.3d 316, 322 (Tex. 2004) (orig. proceeding). An agency has exclusive jurisdiction when a pervasive regulatory scheme indicates the legislature intended for the regulatory process to be the exclusive means of remedying the problem to which the regulation is addressed. Sw. Bell, 235 S.W.3d at 624-25; Subaru of Am., Inc. v. David McDavid Nissan, Inc., 84 S.W.3d 212, 221 (Tex. 2002). If an agency has exclusive jurisdiction to resolve a dispute, a party must first exhaust administrative remedies before a trial court has subject matter jurisdiction. Id.
The legislature mandated that "notwithstanding any other law," the Department shall "license, register, and enforce regulations applicable to child-care facilities." Tex. Hum. Res. Code Ann. § 40.002(b)(3) (Vernon Supp. 2009). The purpose of the requirements is to "protect the health, safety, and well-being of the children of the state who reside in child-care facilities by establishing statewide minium standards for their safety and protection and by regulating the facilities through a licensing program." Id. at § 42.001.
Section 42.041(a) provides that "[n]o person may operate a child-care facility . . . without a license issued by the [D]epartment." Section 42.041(b), however, lists the facilities which are not required to fulfill the licensing requirements under section 42.041(a). The Department established a process by which a facility could claim it was not required to be licensed. See T.A.C. §§ 745.101-.143. Further, section 745.137 of the administrative code provides for the administrative review if an applicant disagrees with the Department's adverse decision regarding an exemption.
ASI claims it falls within the categories of facilities exempt from licensing under section 42.041(b). However, ASI did not follow the Department's process for obtaining an exemption under the administrative code, but first sought relief from the trial court. Because we conclude the legislature gave the Department the power to promulgate a pervasive regulatory scheme, the Department has exclusive jurisdiction to determine whether ASI is exempt from its licensing requirements. See Sw. Bell, 235 S.W.3d at 624-25; Subaru, 84 S.W.3d at 221; see also Tex. Hum. Res. Code Ann. § 40.002(b)(3). Therefore, since ASI failed to exhaust its administrative remedies, the trial court lacked subject matter jurisdiction over the case. See Sw. Bell, 235 S.W.3d at 624-25; Subaru, 84 S.W.3d at 221. We sustain the Department's second issue.
Based upon our determination of the Department's second issue, we need not address its remaining issues. We, therefore, reverse the judgment of the trial court and render judgment in favor of the Department.