Justice O'NEILL delivered the opinion of the Court, in which Chief Justice PHILLIPS, Justice HECHT, Justice OWEN, Justice JEFFERSON, Justice SCHNEIDER, Justice SMITH, and Justice WAINWRIGHT joined.
Once again, we are called upon to consider a waiver-by-conduct exception to the sovereign-immunity rule. In this case, a county solicited bids for purchasing a parcel of land, accepted the highest bid, deposited the tendered earnest money, and sent the purported buyer a warranty deed and affidavit to be used to close the transaction. The county delayed authorization to sign the deed, however, and a newly elected commissioners court refused to approve the sale. We must decide whether the county, by its conduct, waived its immunity from suit. We hold that it did not, and affirm the court of appeals' judgment affirming the trial court's summary judgment in the county's favor. 105 S.W.3d 643.
On January 27, 1993, the El Paso County Commissioners Court passed a motion providing that a 381.90-acre parcel of
On January 1, 1995, the newly elected commissioners court took office. The new court never signed the property over to Collins, and Collins sued El Paso County for breach of contract and specific performance. The trial court granted the County's motion for summary judgment based on its immunity from suit. The court of appeals affirmed. 105 S.W.3d 643. We granted Collins's petition for review to consider whether, by its conduct, the County waived immunity from suit.
"A county is a governmental unit protected by the doctrine of sovereign immunity." Travis County v. Pelzel & Assocs., Inc., 77 S.W.3d 246, 248 (Tex.2002). Generally, a governmental unit possesses both immunity from liability and immunity from suit. Id. When the governmental unit contracts with a private party it waives immunity from liability, but not immunity from suit. Id. The governmental unit waives immunity from suit only through its express consent. Id.
It is undisputed that El Paso County did not expressly waive its immunity from suit here. In Federal Sign, we noted that there might be circumstances "where the State may waive its immunity by conduct other than simply executing a contract," although under the facts of that case, it was not necessary to indicate what those circumstances might be. Federal Sign v. Texas S. Univ., 951 S.W.2d 401, 408 n. 1 (Tex.1997). Since Federal Sign, we have had several occasions to consider circumstances that were urged to constitute a waiver by conduct. See Pelzel, 77 S.W.3d at 251-52 (county withheld money due under a construction contract pursuant to contract's liquidated-damages clause); Texas Natural Res. Conservation Comm'n v. IT-Davy, 74 S.W.3d 849, 856-57 (Tex. 2002) (contractor sought to recover cost overruns allowed by contract's equitableadjustments clause); Gen. Servs. Comm'n v. Little-Tex Insulation Co., Inc., 39 S.W.3d 591, 595 (Tex.2001) (contract disputes regarding cost overruns for completed work, and to recover for work partially performed under a contract that was subsequently terminated). We held that the facts these cases presented did not support an equitable waiver by conduct of the governmental entities' immunity.
Relying on Federal Sign, Collins claims that the facts presented here support
The actions that El Paso County took are the kind that are necessary and expected during contract formation. Soliciting for bids in the local paper allowed the County to determine who might be interested in purchasing the land, and was a required act under Texas law. Tex. Loc. Gov't Code § 272.001(a). Accepting Collins's bid and earnest money, and sending Collins a contract, were steps in forming a contract between the parties. Collins describes nothing in El Paso County's conduct that falls outside the realm of contract formation. And we have made clear that contract formation, by itself, is not sufficient to waive a governmental unit's immunity from suit. Pelzel, 77 S.W.3d at 248; Federal Sign, 951 S.W.2d at 408.
Collins argues that this case is factually distinguishable from Federal Sign because Collins fully performed under the contract. See Federal Sign, 951 S.W.2d at 412-13 (Hecht, J., concurring) (questioning whether the result would have been different had Federal Sign tendered performance). Collins claims that his actions, including forwarding the earnest money to the County and depositing money with the title company, fulfilled his obligations to the County and constituted full performance. But Collins ignores an important distinction between Federal Sign and this case. In Federal Sign, the State was the buyer of commercial goods, while here the County is the seller of government land. Collins does not seek to recover for goods already conveyed. Instead, Collins wishes to force a sale of land that belongs to the people of El Paso County. Although in Federal Sign we suggested that some circumstances might warrant recognizing a waiver by conduct, the equitable basis for such a waiver simply does not exist under this set of facts.
Indeed, the facts presented here illustrate a fundamental reason why immunity exists—to prevent governmental entities from being bound by the policy decisions of their predecessors. See IT-Davy, 74 S.W.3d at 854 (stating that "legislative control ensures that current policymakers are neither bound by, nor held accountable for, policies underlying their predecessors' long-term contracts") (citing Harold J. Krent, Reconceptualizing Sovereign Immunity, 45 Vand. L.Rev. 1529, 1538 (1992)). In this case, the County, upon an electoral change in the commissioners court, determined that selling the property to Collins was a poor decision. Rather than lock El Paso County residents into a contract not in their best interest, the court acted within its discretion to protect the perceived interests of the public by rejecting the contract. In doing so, the County did not profit unfairly at Collins's expense.
Finally, we have reviewed Collins's additional complaints and conclude that they were waived for failure to raise them below.
We hold that El Paso County did not, by its conduct, waive its immunity in this case. Accordingly, we affirm the judgment of the court of appeals.
Justice ENOCH filed a dissenting opinion.
Justice ENOCH, dissenting.
I continue my disagreement with this Court's unique position among the vast majority of states that when a governmental unit contracts with a private party, the governmental unit does not waive immunity from suit.
In this case, Collins answered the County's advertised request for bids to purchase property, tendering a $5,000 earnest money check. The County specifically accepted the bid and cashed the check. Collins deposited the remaining purchase price plus closing costs—$2,554,961.72— with a title company. The County sent Collins a warranty deed and an affidavit for the closing, which Collins executed and returned to the County. Then, ostensibly through a "vote" of the county commissioners, the County refused to authorize the warranty deed's execution by the county judge. As a result, Collins brought suit for breach of contract and specific performance.
Accepting the Court's position that mere execution of a contract does not waive immunity from suit, this case is most surely a waiver by conduct. The County cashed and used the $5,000 earnest money deposit, even though it had no intention of executing the warranty deed. This fact distinguishes this case from every other case that the Court has considered where the governmental unit "failed" to comply with the contract because, in those cases,
The Court, squarely faced with this blatant conduct, runs from its position by noting that the County eventually returned Collins' $5,000, though years later and after the suit had progressed to the summary judgment stage.
By taking the earnest money and treating it as its own, the County waived its right to assert that it could not be sued on the purchase contract. And once the trial court acquired jurisdiction over the case, that jurisdiction was not lost when the County finally gave the money back to Collins. When the trial court obtained jurisdiction, which it did when Collins filed suit, it had the authority to decide the merits of the entire controversy.
Concerning the merits, the Court concludes that the bidding statute
But more importantly, the bidding statute authorizes a governmental unit not "to accept any bid or to complete a sale or exchange"
I would reverse the court of appeals' judgment and remand the case to the trial