author: Justice RODRIGUEZ.

text:
    The STATE of Texas, the Texas General Land Office, and the Texas Land Commissioner, Appellants, v. Herbert W. HOLLAND, Appellee.
    No. 13-04-099-CV.
    Court of Appeals of Texas, Corpus Christi-Edinburg.
    March 24, 2005.

      Kristofer S. Monson, Austin, for appellants.
    Thomas W. Sankey, Sankey & Luck, for appellee.
    Before Chief Justice VALDEZ and Justices HINOJOSA and RODRIGUEZ.
   OPINION

Opinion by

Justice RODRIGUEZ.

Appellants, the State of Texas, the Texas General Land Office, and the Texas Land Commissioner, bring this accelerated interlocutory appeal following the trial court’s denial of their plea to the jurisdiction. Appellants contend that the trial court erred in denying its plea to the jurisdiction because (1) appellee, Herbert Holland, failed to adequately plead a cause of action for inverse condemnation; and (2) the State acted under color of contract, and therefore, no takings claims can be brought as a matter of law. We affirm.

I. FACTUAL AND PROCEDURAL BACKGROUND

Over the past several years, the Texas General Land Office has worked to abate oil pollution in areas of the Gulf of Mexico by constructing filtration units along the Texas coast. Specifically, the State has been involved in the construction of these facilities at Port Isabel, Palacios, and Port Lavaca, Texas. The filtration units use a series of special polymer-based filters to remove the pollution. Holland holds the patent for those filters and for the filtration process.

In 2002, Holland sent a letter to the State claiming the State had infringed on his patent and requesting payment for the use of his patented technology. After the State refused to pay, Holland filed suit, asserting inverse condemnation under article I, section 17 of the Texas Constitution. The State responded with a general denial and a pléa to the jurisdiction arguing that the trial court lacked jurisdiction because sovereign immunity barred Holland’s claim, there was no intentional act as required in a takings claim, the plaintiffs case was pre-empted by federal law, and Texas does not recognize a takings claim for patent infringement. The State also asserted immunity from suit because Holland had allegedly brought a contract claim disguised as a patent infringement claim.

On February 5, 2004, the trial court held a hearing on the State’s plea to the jurisdiction. After reviewing the pleadings, affidavit evidence and testimony from the parties, the trial court denied appellants’ plea to the jurisdiction. This appeal ensued.

II. STANDARD OF REVIEW

A plea to the jurisdiction is a dilatory plea; its purpose is “to defeat a cause of action without regard to whether the claims asserted have merit.” Bland Indep. Sch. Dist. v. Blue, 34 S.W.3d 547, 554 (Tex.2000). The plea challenges the trial court’s authority to determine the subject matter of a pleaded cause of action. City of Midland v. Sullivan, 33 S.W.3d 1, 6 (Tex.App.-El Paso 2000, pet. dism’d w.o.j.); State v. Benavides, 772 S.W.2d 271, 273 (Tex.App.-Corpus Christi 1989, writ denied). Because subject matter jurisdiction is a question of law, we review a trial court’s ruling on a plea to the jurisdiction under a de novo standard of review. State v. Gonzalez, 82 S.W.3d 322, 327 (Tex.2002).

When a plea to the jurisdiction challenges the pleadings, we. determine if the pleader has alleged facts that affirmatively demonstrate the trial court’s jurisdiction to hear the cause. Tex. Ass’n of Bus. v. Tex. Air Control Bd., 852 S.W.2d 440, 446 (Tex.1993). In determining whether jurisdiction exists, rather than looking at the claim’s merits, we look to the allegations in the pleadings, accept them as true, and construe them in favor of the pleader. See County of Cameron v. Brown, 80 S.W.3d 549, 555 (Tex.2002). We consider the facts alleged in the petition, and to the extent it is relevant to the jurisdictional issue, any evidence submitted by the parties to the trial court. Tex. Natural Res. Conservation Comm’n v. White, 46 S.W.3d 864, 868 (Tex.2001); Bland, 34 S.W.3d at 555.

III. ANALYSIS

Holland’s first amended petition asserts an inverse condemnation claim pursuant to article I, section 17 of the Texas Constitution. See Tex. Const, art. I, § 17. Section 17 provides that “no person’s property shall be taken, damaged or destroyed for or applied to public use without adequate compensation being made.... ” Id. Condemnation is the procedure by which a sovereign state exercises its right to take property of a private owner for public use, without consent, but upon the payment of just compensation. AC. Aukerman Co. v. State, 902 S.W.2d 576, 578 (Tex.App.-Houston [1st Dist.] 1995, pet. denied). Inverse condemnation occurs when a property owner seeks compensation for property taken for public use without process or a proper condemnation proceeding. Id.

Generally, sovereign immunity, unless waived, protects the State of Texas, its agencies and its officials from lawsuits for damages, absent legislative consent to sue the State. Fed. Sign v. Tex. S. Univ., 951 S.W.2d 401, 405 (Tex.1997). Under article I, section 17 of the Texas Constitution, sovereign immunity is waived for a valid inverse condemnation claim. Dahl v. State, 92 S.W.3d 856, 862 (Tex.App.-Houston [14th Dist.] 2002, no pet.). If, however, a plaintiff does not allege a valid inverse condemnation claim, sovereign immunity does apply, and a court should grant the plea to the jurisdiction. Id.

A. Inverse Condemnation Pleading

Appellants first contend that the trial court erred in denying their plea to the jurisdiction because Holland failed to adequately plead a cause of action for inverse condemnation and therefore, sovereign immunity is not waived. To plead a cause of action for inverse condemnation, Holland was required to assert that his property was taken, damaged or destroyed for or applied to public use. See A.C. Aukerman, 902 S.W.2d at 578. Additionally, the act which resulted in the taking must be intentional. Id. The taking, damage or destruction must be an actual physical appropriation or invasion of property, or unreasonable interference with the owner’s right to use and enjoy his property. Id.

Holland’s first amended petition alleges, in relevant part, the following:

9.The practice of the method used by the [General Land Office] and the use of the apparatus are physical acts that constitute an invasion of Plaintiff’s property right.
10. The practice of the method used by the [General Land Office] and the use of the apparatus are physical acts that constitute an unreasonable interference with Plaintiffs exclusive right to use and enjoy his . property.
11. The acts of the [General Land Office], constitute a taking of Plaintiffs property without just compensation.
12. Plaintiffs property has been taken by the [General Land Office] for or applied to public use.
13. The acts by the [General Land Office], which have resulted in the taking of Plaintiff’s property, were done intentionally and are continuing to be- done intentionally.

(Emphasis added). Looking at the allegations in Holland’s petition, it is clear that he properly pled the elements of an inverse condemnation claim.

Appellants contend that Holland’s allegations are insufficient to plead a “taking” within the meaning of article I, section 17 because Holland has not provided proof that his property has been destroyed or damaged. We note that “taking,” “damaging,” and “destruction” of one’s property are three distinct claims arising under article I, section 17, although the term “taking” has become used as a shorthand to refer to all three types of claims. City of Dallas v. Jennings, 142 S.W.3d 310, 313 n. 2 (Tex.2004). In this case, Holland has pleaded a “taking” claim, not a “damage” or “destruction” claim. Therefore, Holland is not required to allege that his property was damaged or destroyed. Nor is he required to marshal proof at this time, as it is necessary only to plead facts showing the elements of the cause of action. Kerr v. Tex. Dep’t of Transp., 45 S.W.3d 248, 251 n. 3 (Tex.App.-Houston [1st Dist.] 2001, no pet.).

Additionally, appellants argue that Holland’s petition does not assert that the State had the requisite intent for an inverse condemnation claim. In support of this argument, appellants cite to Jennings, 142 S.W.3d at 314, for the proposition that in order to establish a taking, the taking entity must know (1) the act will cause an identifiable harm or (2) that specific property damage is substantially certain to result. However, we find the Jennings case distinguishable as the supreme court in that case was analyzing the required intent for a claim of “damage” to property. See id. at 313-15. The two prongs set out by the supreme court to establish the intent element in a “damage” claim are not necessary in a “taking” claim. As we stated earlier, a “damage” claim is distinctly different from Holland’s “taking” claim. Holland alleged that the State intentionally performed acts which resulted in a “taking” of property for public use. Holland need not allege that the State knew the act would cause an identifiable harm or that specific property damage is substantially certain to result. We therefore find Holland’s pleadings are sufficient to satisfy the intent element of his inverse condemnation claim.

Accordingly, looking at the allegations in the pleadings, accepting them as true, and construing them in favor of the pleader, see Brown, 80 S.W.3d at 555, we conclude Holland’s petition clearly states a claim for inverse condemnation. Appellants’ first issue is overruled.

B. Existence of a Contract

By their second issue, appellants argue that the trial court should have granted the State’s plea to the jurisdiction based on the State’s evidence that an implied-in-fact contract existed with Holland’s companies for the construction and use of the Palacios facility. When the State acts within a color of right under a contract and not under its eminent domain powers, the State does not have the requisite intent under constitutional-takings jurisprudence. See Gen. Servs. Comm’n v. Little-Tex Insulation Co., Inc., 39 S.W.3d 591, 598-99 (Tex.2001). Therefore, if a contract exists in this case regarding the State’s use of Holland’s patented filtration process, Holland cannot plead a valid takings claim, and the State’s plea to the jurisdiction should be granted. See id.

If a plea to the jurisdiction challenges the existence of jurisdictional facts, we consider relevant evidence submitted by the parties when necessary to resolve the jurisdictional issues raised, as the trial court is required to do. Tex. Dep’t Parks & Wildlife v. Miranda, 133 S.W.3d 217, 227 (Tex.2004). When the consideration of a trial court’s subject matter jurisdiction requires the examination of evidence, the trial court exercises its discretion in deciding whether the jurisdictional determination should be made at a preliminary hearing or await a fuller development of the case, mindful that this determination must be made as soon as practicable. Id. In a case in which the jurisdictional challenge implicates the merits of the plaintiffs cause of action and the plea to the jurisdiction includes evidence, the trial court reviews the relevant evidence to determine if a fact issue exists. Id. If the evidence creates a fact question regarding the jurisdictional issue, then the trial court cannot grant the plea to the jurisdiction, and the fact issue will be resolved by the fact finder. Id. However, if the relevant evidence is undisputed or fails to raise a fact question on the jurisdictional issue, the trial court rules on the plea to the jurisdiction as a matter of law. Id.

The evidence introduced by appellants at the hearing included invoices, purchase requisitions and other correspondence between the General Land Office and the two companies owned by Holland, Spill Removal Products and Pollution Prevention Services. This evidence shows that the State paid money to Holland’s companies for the components, installation, design and consulting for the Palac-ios facility. Additionally, the State introduced the testimony of Dale Smith who testified as to the existence of a contractual relationship between the State and Holland’s companies. However, there is little evidence supporting the existence of a contract with Holland, the owner of the patent. The State’s own witness acknowledged that there was no contract with Holland.

Based on the evidence presented by appellants, this Court cannot conclude as matter of law that an implied contract existed between the State and Holland regarding the use of Holland’s patented filtration process. Accordingly, we find that a fact issue exists as to the existence of a contract which must be resolved by the fact finder. See Haws & Garrett Gen. Contractors, Inc. v. Gorbett Bros. Welding Co., Inc., 480 S.W.2d 607, 610 (Tex.1972) (stating that the existence of an implied contract rests upon inferences which are drawn by the trier of fact from surrounding facts and circumstances). Appellants’ second issue is overruled.

IV. CONCLUSION

      . This Court has jurisdiction pursuant to section 51.014(a)(8) of the Texas Civil Practice and Remedies Code. See Tex Civ. Prac. & Rem.Code Ann. § 51.014(a)(8) (Vernon Supp. 2004-2005).


source: Caselaw Access Project

author: Justice GARZA.

license: Public Domain

text:
    CITY OF PORT ISABEL, Texas, Appellant, v. HP PINNELL, Trustee of Pinnell Trust and Town of South Padre Island, Appellees.
    No. 13-04-594-CV.
    Court of Appeals of Texas, Corpus Christi-Edinburg.
    March 24, 2005.
    Rehearing Overruled April 28, 2005.

      Alan T. Ozuna, Ricardo J. Navarro, Denton, Navarro, Rocha & Bernal, Harlingen, for appellant.
    Cobby Caputo, Matthew F. Stowe, Office of Atty. Gen., Bradley B. Young, Patricia L. Akers, Austin, R.K. Whittington, Law Office of R.K. Whittington, Harlingen, Horacio L. Barrera, Martinez & Barrera, Brownsville, for appellees.
    Before and Justices HINOJOSA, RODRIGUEZ and GARZA.
   OPINION

Opinion by

Justice GARZA.

In this interlocutory appeal, the City of Port Isabel challenges the trial court’s denial of its plea to the jurisdiction, which sought dismissal of a suit for injunctive and declaratory relief filed by H.P. Pinnell and the Town of South Padre Island, as an intervenor. Because we conclude that Pin-nell and the Town of South Padre Island each have standing to sue the City of Port Isabel, we affirm the trial court’s order denying the plea to the jurisdiction.

I. Background

This lawsuit arises from a dispute between the City of Port Isabel, the Town of South Padre Island (“SPI”), and Pinnell over which municipality should control certain unincorporated land. Port Isabel, a home-rule municipality with just over 5,000 inhabitants, is located on the mainland of Texas and borders on a body of water known as the Laguna Madre. SPI, a general law municipality, is located on a long, narrow coastal barrier island known as South Padre Island (“the Island”). Port Isabel is separated from the Island by a body of water called the Laguna Madre. The only means of access to and from the Island (other than by water or air).-is the 2½ mile long Queen Isabella Memorial Causeway. Pinnell is the owner of land located on the Island that consists of approximately 460 acres. The Pinnell Property is located north of SPI and approximately six miles from Port Isabel.

Port Isabel contends that it should have control of the Pinnell Property, while SPI and Pinnell contend that SPI should have control. A series of conflicting ordinances were passed by Port Isabel and SPI under which each municipality now claims control of the Pinnell Property. The ordinances and the present lawsuit unfolded as follows.

Between July and August of 2003, Port Isabel adopted three separate ordinances that purported to annex an area located entirely in the Laguna Madre. The ordinances extended Port Isabel’s boundary fifteen miles into the water, with each ordinance extending the boundary by five miles. In February 2004, Port Isabel scheduled and posted notice of a public hearing to annex eighteen separate areas located entirely in the Laguna Madre. These areas were divided into one-mile units that covered essentially the same areas annexed by the prior ordinances. On February 4, 2004, Port Isabel sent notice to Pinnell that it intended to annex the Pinnell Property and that public hearings regarding the proposed annexation would be held on March 8-9, 2004. On February 24, 2004, Port Isabel’s city commission met and adopted seventeen ordinances annexing approximately 23,270 acres located entirely within the Laguna Madre. These ordinances extended Port Isabel’s boundary to the shores of the Island. Although the ordinances did not annex the Pinnell Property, ordinance 652 shifted Port Isabel’s boundary to within one mile of the Pinnell Property. According to Port Isabel, this brought the Pinnell Property within its extraterritorial jurisdiction (“ETJ”).

On March 8, 2004, SPI adopted an ordinance expanding its ETJ to include the Pinnell Property. This ordinance was adopted in response to a request by Pinned on February 23, 2004 and purports to be effective as of the date of Pinnell’s request. On March 29, 2004, Pinnell filed this action seeking injunctive relief and a judgment declaring Port Isabel’s annexation ordinances invalid. On the same date, the trial court entered a temporary restraining order prohibiting Port Isabel from annexing the Pinnell Property. Subsequently, the trial court denied Pinnell’s application for temporary injunctive relief. SPI then intervened in the lawsuit, seeking a permanent injunction against Port Isabel and a judicial declaration that the annexation ordinances adopted by Port Isabel are void ab initio.

On April 6-7, 2004, Port Isabel adopted three new ordinances annexing additional areas, and on April 9-10, 2004, Port Isabel annexed the Pinnell Property by adopting Ordinance No. 657. Port Isabel then filed a comprehensive jurisdictional plea in the trial court, seeking dismissal of the claims filed by Pinnell and SPI. The trial court denied Port Isabel’s plea on October 18, 2004, and Port Isabel filed this interlocutory appeal.

Port Isabel raises four issues: (1) Pin-nell and SPI lack capacity to sue Port Isabel for any procedural irregularities related to the passage of Port Isabel’s annexation ordinances; (2) Pinnell and SPI lack standing to complain about the annexation ordinances; (3) SPI cannot bring a claim under the Texas Open Meetings Act because it is not an “interested person” and because its grievance is not cognizable under the open meetings act; and (4) SPI’s claim under the Texas Public Information Act fails because the information act does not authorize a private party to seek declaratory or injunctive relief. Pin-nell and SPI have filed separate briefs in response to Port Isabel’s appeal, in which they argue that the trial court did not err by denying Port Isabel’s plea to the jurisdiction. Additionally, the Office of the Attorney General has filed an amicus cmiae brief in support of SPI.

II. Analysis

A plea to the jurisdiction contests the authority of a court to determine the subject matter of a cause of action. Dolenz v. Tex. State Bd. of Med. Examin ers, 899 S.W.2d 809, 811 (Tex.App.-Austin 1995, no writ). Whether a court has subject matter jurisdiction is a matter of law and is reviewed de novo. Hoff v. Nueces County, 153 S.W.3d 45, 48 (Tex.2004) (per curiam). As the party seeking to invoke the trial court’s jurisdiction, the plaintiff must allege facts that affirmatively demonstrate the court’s jurisdiction to hear the cause. See Tex. Ass’n of Bus. v. Tex. Air Control Bd., 852 S.W.2d 440, 446 (Tex.1993). When reviewing a trial court’s ruling on a plea to the jurisdiction, Texas appellate courts “construe the pleadings in favor of the plaintiff and look to the pleader’s intent.” Id. We may also consider relevant evidence necessary to resolve the jurisdictional issues raised. County of Cameron v. Brown, 80 S.W.3d 549, 555 (Tex.2002).

A. Capacity to Sue

Port Isabel’s first issue contends that neither Pinnell nor SPI has capacity to sue Port Isabel for any procedural irregularities related to the passage of Port Isabel’s annexation ordinances because such complaints can be made only by the State of Texas in a quo warranto proceeding. In response, Pinnell and SPI argue that they do have capacity because the annexation ordinances are void ab initio. See Alexander Oil Co. v. Seguin, 825 S.W.2d 434, 436 (Tex.1991) (“The only proper method for attacking the validity of a city’s annexation of territory is by a quo warranto proceeding, unless the annexation is wholly void.”). Additionally, Pin-nell and SPI argue that a plea to the jurisdiction cannot be granted based on a lack of capacity. We agree with this second contention.

Capacity is a party’s legal authority to sue or be sued. See Davis v. City of Houston, 869 S.W.2d 493, 494 n. 1 (Tex.App.-Houston [1st Dist.] 1993, writ denied). Capacity is not a jurisdictional issue. Mackie v. Guthrie, 78 S.W.3d 462, 465 (Tex.App.-Tyler 2001, pet. filed) (citing Nootsie, Ltd. v. Williamson County Appraisal Dist., 925 S.W.2d 659, 661 (Tex.1996)). We therefore conclude that the trial court did not err by denying Port Isabel’s plea based on capacity. Port Isabel’s first issue is overruled.

B. Standing to Sue

In its second issue, Port Isabel contends that neither Pinnell nor SPI have standing to sue. According to Port Isabel, Pinnell and SPI have no authority over the tracts of land covered by the ordinances other than ordinance 657 and therefore no standing to sue based on these ordinances. As for ordinance 657, Port Isabel contends that the complaints made by Pinnell and SPI allege no more than mere procedural irregularities in Port Isabel’s exercise of its annexation authority, allegations which, even if true, cannot confer standing.

Standing is a component of subject matter jurisdiction. Tex. Ass’n of Bus., 852 S.W.2d at 446. In reviewing a private party’s standing to challenge an annexation, an appellate court must decide whether the challenge attacks the city’s authority to annex the area in question or simply complains of some violation of statutory procedure. Werthmann v. City of Fort Worth, 121 S.W.3d 803, 806 (Tex.App.-Fort Worth 2003, no pet.). If the annexation is void because the city has no authority to annex, a collateral attack by private parties is permissible, Hoffman, 476 S.W.2d at 846; however, a private party must nonetheless suffer some burden peculiar to itself to acquire standing to sue, West Lake Hills v. State, 466 S.W.2d 722, 727 (Tex.1971). Because there are two distinct requirements for standing (i.e., a void ordinance and a special burden), our analysis proceeds in two parts.

1. Void Ordinances

Historically, Texas courts have held that an annexation ordinance exceeds a municipality’s authority when the annexation (1) exceeds the statutory limits on size, (2) attempts to annex areas within the jurisdiction of another city, (3) attempts to annex areas not contiguous -with city limits, or (4) attempts to annex an area with an open boundary description. Alexander Oil, 825 S.W.2d at 438 (citing illustrative case law). In addition, the local government code expressly states that “[a] municipality may annex area only in its extraterritorial jurisdiction unless the municipality owns the area.” Tex. Loc. Gov’t Code Ann. § 43.051 (Vernon 1999). The Texas Supreme Court has held that a municipality may not annex land in another municipality’s ETJ without that municipality’s consent. City of Murphy v. City of Parker, 932 S.W.2d 479, 481 (Tex.1996).

It is not enough to allege mere irregularities in a city’s exercise of its annexation authority. See Werthmann, 121 S.W.3d at 806 (citing Alexander Oil, 825 S.W.2d at 438). For instance, notice and hearing requirements are procedural limits on annexation and do not affect the municipality’s authority to make the annexation. City of San Antonio v. Hardee, 70 S.W.3d 207, 212 (Tex.App.-San Antonio 2001, no pet.). Procedural irregularities may render the annexation voidable but not void. See Werthmann, 121 S.W.3d at 806 (citing City of Balch Springs v. Lucas, 101 S.W.3d 116, 122 (Tex.App.-Dallas 2002, no pet.)). An attack upon an annexation ordinance based on procedural irregularities must be made by the State in an action of quo warranto. See Hoffman v. Elliott, 476 S.W.2d 845, 846 (Tex.1972) (per cu-riam).

Pinnell’s first amended original petition alleges that each of Port Isabel’s ordinances is void ab initio due to annexations of areas (1) outside the City’s ETJ, (2) not adjacent to or contiguous to the existing city limits, (3) with open boundaries that do not close, (4) located entirely within a body of water and not including land more than 1,000 feet in width at its narrowest point, and/or (5) located within the ETJ of another municipality. SPI’s third amended petition in intervention alleges, inter alia, that Port Isabel has (1) enacted annexation ordinances that exceed the statutory size limit of one mile, (2) attempted to annex territory in SPI’s ETJ, (3) attempted to annex territory that is not within its city limits, and (4) attempted to annex territory that contains an open boundary description.

The allegations made by Pinnell and SPI, if proven true, would establish that at least one of Port Isabel’s annexation ordinances is void. See Tex. Loc. Gov’t Code Ann. § 43.051; City of Parker, 932 S.W.2d at 481; Alexander Oil, 825 S.W.2d at 438. All subsequent ordinances that depend on the void ordinance would also be void. See West Lake Hills, 466 S.W.2d at 729. Thus, if Pinnell and SPI succeed in establishing that any one of Port Isabel’s annexation ordinances is void, ordinance 657, which depends on each of the other ordinances, will also be void. In short, the claims brought by Pinnell and SPI are not complaints of mere irregularities in Port Isabel’s exercise of its annexation authority; they are complaints that the ordinances are void. Accordingly, the suits are permissible and need not be brought by the State in a quo warranto proceeding. See Hoffman, 476 S.W.2d at 846.

2. Special Burden

We turn now to the second requirement for standing: a special burden. Most commonly the special burden required for standing to challenge a city’s annexation ordinance is the imposition of tax. West Lake Hills, 466 S.W.2d at 727. A special burden does not exist if the claimant merely alleges the ordinary consequences of annexation that burden the general public. See Sunchase Capital Group, Inc. v. City of Crandall, 69 S.W.3d 594, 596 (Tex.App.-Tyler 2001, no pet.).

We conclude that the disputed annexation ordinances have created special burdens for both Pinnell and SPI. If the ordinances are allowed to stand, Pinnell will be taxed by Port Isabel and SPI’s ETJ will be annexed by Port Isabel. Because the entire series of annexation ordinances adopted by Port Isabel is necessary to annex the disputed land on the Island (i.e., the Pinnell Property and SPI’s ETJ), we conclude that both Pinnell and SPI have standing to challenge all of the disputed ordinances. See City of Northlake v. E. Justin Joint Venture, 873 S.W.2d 413, 416-17 (Tex.App.-Fort Worth 1994, writ denied); Missouri City v. Senior, 583 5.W.2d 444, 446 (Tex.Civ.App.-Houston [1st Dist.] 1979, writ ref d n.r.e.).

Port Isabel argues that Pinnell and SPI have no standing to challenge the entire series of annexation ordinances passed by Port Isabel because only ordinance 657 actually annexed the disputed land and created a special burden for Pinnell and SPI. We disagree. On its own, ordinance 657 would not have imposed a special burden on Pinnell and SPI because, on its own, ordinance 657 would be void. The validity of ordinance 657 depends on the validity of the other ordinances that extended Port Isabel’s city limits to the shores of the Island. Without these ordinances, ordinance 657 would be of no effect. We therefore conclude, as other courts have in similar situations, that the special burdens on Pinnell and SPI were imposed by not only ordinance 657 but by all the ordinances on which ordinance 657 depends.. See E. Justin Joint Venture, 873 S.W.2d at 416-17; Senior, 583 S.W.2d at 446.

For instance, in Senior, the claimants’ land was annexed by ordinance 116. Senior, 583 S.W.2d at 446. The claimants filed suit against the municipality, arguing that ordinance 102, on which ordinance 116 depended, was void. Id. The municipality argued that the claimants lacked standing to challenge ordinance 102, but both the trial court and the court of appeals concluded that the claimants did have standing because ordinance 116 depended on ordinance 102. Id.

Similarly, in E. Justin Joint Venture, the court concluded that a landowner had standing to challenge the validity of a conversion ordinance that transformed a municipality into a type-A general law municipality because it was “arguably ... necessary” for the annexation of the claimant’s property. E. Justin Joint Venture, 873 S.W.2d at 416-17. According to the court, the conversion ordinance caused “peculiar harm” to the claimant and therefore conferred standing to sue. Id. at 417.

For the foregoing reasons, we conclude that Pinnell and SPI have standing to sue. Port Isabel’s second issue is overruled.

C. Texas Open Meetings Act

In its third issue, Port Isabel argues that the trial court erred by denying its plea to the jurisdiction based on SPI’s inability to bring a claim under the Texas Open Meeting Act. According to Port Isabel, “[The] Town does not have capacity or standing to collaterally attack an annexation order, [and] it [therefore] makes no practical sense that it could accomplish the same result through the vehicle of an Open Meetings violation.”

A city’s annexation may be challenged under the Texas Open Meetings Act, which provides guidelines for standing to sue that are different from the common law test discussed above:

An interested person, including a member of the news media, may bring an action by mandamus or injunction to stop, prevent, or reverse a violation or threatened violation of this chapter by members of a governmental body.

Tex. Gov’t Code Ann. § 551.142 (Vernon 2004); see also Hardee, 70 S.W.3d at 212-13. Port Isabel argues that SPI is not an “interested person,” but it fails to make any argument other than those related to capacity and standing under the common law. We have noted that capacity is not a jurisdictional issue and is, therefore, not a basis to dismiss for lack of jurisdiction. See Mackie, 78 S.W.3d at 465. Additionally, we have concluded that SPI has standing under the common law because it alleges that Port Isabel’s annexation ordinances are void and because it further alleges that the ordinances directly affect it in a manner different from the general public (i.e., they annex SPI’s ETJ).

As we have noted previously, “The majority of courts addressing the ‘interested person’ requirement have adopted an extremely broad interpretation regarding who constitutes an ‘interested person.’ ” Matagorda County Hosp. Dist. v. City of Palacios, 47 S.W.3d 96, 102 (Tex.App.-Corpus Christi 2001, no pet.) (citing illustrative case law). For instance, the Austin court concluded that standing under the Texas Open Meetings Act is broader than under the common law. See Save Our Springs Alliance, Inc. v. Lowry, 934 S.W.2d 161, 163 (Tex.App.-Austin 1996, orig. proceeding) (per curiam). The court reasoned that the interest protected by the Texas Open Meetings Act is the interest of the general public. Id. We have concluded that SPI has an interest more particularized than that of the general public because its ETJ is directly affected by the disputed ordinances; however, SPI also shares the general public’s interest in ensuring that the protections of the Texas Open Meetings Act are enforced. We therefore conclude that SPI is an “interested person” and has standing to sue under the Texas Open Meetings Act.

Port Isabel also argues that the trial court should have granted its plea to the jurisdiction because SPI has failed to state a valid claim under the open meetings act. We disagree. Failure to state a claim is a defect which should be challenged by special exceptions, not by a plea to the jurisdiction. See Massey v. Armco Steel Co., 652 S.W.2d 932, 934 (Tex.1983); Centennial Ins. Co. v. Commercial Union Ins. Cos., 803 S.W.2d 479, 483 (Tex.App.-Houston [14th Dist.] 1991, no writ) (“Although Fed.R.Cxv.P. 12(b)(6) provides for a motion to dismiss for failure to state a claim upon which relief can be granted, the Texas Rules of Civil Procedure do not contain any analogous provision. Under the Texas Rules of Civil Procedure, the proper way for a defendant to urge that a plaintiff has failed to plead a cause of action is by special exception.”). If the pleading deficiency is of the type that cannot be cured by an amendment, a special exception is unnecessary and a take-nothing summary judgment based on the pleadings’ failure to state a legal claim is in order. James v. Hitchcock Indep. Sch. Dist., 742 S.W.2d 701, 704 (Tex.App.-Houston 1987, writ denied). The trial court did not err by denying Port Isabel’s plea to the jurisdiction based on SPI’s failure to state a claim under the open meetings act.

Port Isabel’s third issue is overruled.

D. Texas Public Information Act

In its fourth issue, Port Isabel contends that the trial court erred by denying its plea to the jurisdiction based on SPI’s failure to “plead itself to be -within the statutory requirements for asserting a violation of the Public Information Act.” Port Isabel argues that SPI “does not have the capacity to independently initiate a declaratory or injunctive action against the City of Port Isabel.”

As we have noted, capacity is not a jurisdictional issue and therefore not a basis for granting a plea to the jurisdiction. See Mackie, 78 S.W.3d at 465. We understand Port Isabel’s fourth issue as also complaining of the relief sought by SPI under the information act (i.e., declaratory and injunctive relief). This is a pleading defect, which is properly challenged by a special exception, not by a plea to the jurisdiction. See Fort Bend County v. Wilson, 825 S.W.2d 251, 253 (Tex.App.Houston [14th Dist.] 1992, no writ) (“Under the Texas Rules of Civil Procedure, a special exception is the appropriate vehicle for urging that the plaintiff has failed to plead a cause of action, and the pleader must be given, as a matter of right, an opportunity to amend the pleading.”) (citing Moseley v. Hernandez, 797 S.W.2d 240, 242 (Tex.App.-Corpus Christi 1990, no writ)). Port Isabel’s fourth issue is overruled.

III. Conclusion

We affirm the judgment of the trial court.

      . These were ordinances 627, 628, and 633.

        . This was ordinance 04-04.

      . A municipality may expand its extraterritorial jurisdiction if the owners of the area request the expansion. Tex Loc. Gov’t Cooe Ann. § 42.022(b) (Vernon 1999).

      .These were ordinances 658, 659, and 660.

        . This Court has jurisdiction to decide this appeal under section 51.014(a)(8) of the civil practice and remedies code. Tex Civ. Prac. & Rem.Code Ann. § 51.014(a)(8) (Vernon Supp.2004-05).

      . We emphasize that the standard of review applicable to this appeal precludes this Court from deciding the merits of SPI's contention that its ETJ expansion covering the Pinnell Property occurred prior to Port Isabel’s ETJ expansion. See Tex. Ass’n of Bus., 852 S.W.2d at 446. Instead, we must take the allegations of SPI’s petition as true. See id. The so-called first-in-time issue must be decided as part of the case on the merits. See Univ. of Tex. Med. Branch v. Hohman, 6 S.W.3d 767, 771 (Tex.App.-Houston [1st Dist.] 1999, pet. dism'd w.o.j.) ("Our task is not to determine whether the plaintiff ultimately wins or loses on judicial review; rather, this Court’s task is to examine the facts pleaded and to determine whether those facts support jurisdiction in the trial court.”).


author: Justice CARTER.

text:
    BATJET, INC.; Melrose Nursing Center; Eivis C. Jones, Individually; Rhonda Alexander, R.N., Individually; and Cassie H. Scott, L.V.N., Individually, Appellants, v. Debra JACKSON, Individually, as Representative of all Wrongful Death Beneficiaries, and as Representative and Legal Heir of the Estate of Bernice Janette Greer, Deceased, Appellee.
    No. 06-04-00071-CV.
    Court of Appeals of Texas, Texarkana.
    Submitted March 17, 2005.
    Decided March 30, 2005.

      Julie A. Machal-Fulks, Robert J. Scott, Scott & Scott, LLP, Dallas, for appellants.
    Jason N. Young, Henry P. Giessel, David Marks, The Marks Firm, Houston, David Hill, Wellborn, Houston, et al, Henderson, for appellee.
    Before MORRISS, C.J., ROSS and CARTER, JJ.
   OPINION

Opinion by

Justice CARTER.

This appeal concerns whether a Rule 11 settlement agreement exists among the parties. The trial court decided that it did and ordered Batjet, Inc., Melrose Nursing Center, Eivis C. Jones, individually, Rhonda Alexander, R.N., individually, and Cassie H. Scott, L.V.N., individually, to pay under its terms. We affirm the judgment of the trial court.

A. Factual and Procedural Background

This suit was originally brought as a malpractice lawsuit. Debra Jackson, individually, and as representative of all wrongful death beneficiaries, and as representative and legal heir of the estate of Bernice Janette Greer, deceased, sued Batjet, Inc., et al., for damages allegedly caused by their negligent care of Greer, who died while in their care. The parties engaged in settlement negotiations, and the entire question before this Court is whether the trial court correctly decided that the negotiations were brought to an enforceable conclusion. The trial court issued an order on Jackson’s motion for enforcement and for summary judgment, and directed all defendants to pay $75,000.00 in the form outlined by the agreement (secured by a lien on real property), and $1,500.00 in costs incurred because of the breach of the agreement, and directed Jackson to dismiss the lawsuit with prejudice on receipt of the initial portion of the payment and costs.

Jackson sued the nursing home’s corporate entity and some of its employees in July 2001. In May 2003, they began discussing settlement, and a series of letters were exchanged. Robert Scott, named counsel for all defendants (appellants) sent a letter outlining his proposal for settlement terms. Other letters- were exchanged, each of which altered terms — but only regarding the timing and distribution of the payments. Finally, on June 23, 2003, a document was signed that Jackson contends constitutes a Rule 11 agreement.

On September 4, 2003, counsel for defendants sent a letter to Jackson’s counsel stating that a formal and detailed settlement and release agreement was necessary before they would actually pay any money. The record indicates that counsel for Jackson sent several lengthy versions of a release to defendants and that they refused to sign any of them, and Jackson then moved for enforcement of the Rule 11 agreement.

B. Points of Error

Appellants complain that (1) the court’s ruling is error because the agreement is not enforceable, because the agreement does not state which parties would be released, when they would be released, or the scope of the release; (2) the court should not have stated they were liable because the June 23 letter was ambiguous about which “client” was bound by the agreement, and (3) there are issues of fact about whether the individual defendants intended to be bound by the June 23 letter agreement.

C. Use of Summary Judgment

We first note that the use of a motion for summary judgment in the same lawsuit, where the trial court has jurisdiction over that action, is an appropriate means to use to obtain this type of relief. A written settlement agreement may be enforced though one party withdraws consent before judgment is rendered on the agreement. Mantas v. Fifth Court of Appeals, 925 S.W.2d 656, 658 (Tex.1996). Where consent is lacking, however, a court may not render an agreed judgment on the settlement agreement, but may enforce it only as a written contract. Id. The party seeking enforcement must pursue a separate breach of contract claim, which is subject to the normal rules of pleading and proof. Id.

Where the settlement dispute arises while the trial court has jurisdiction over the underlying action, a claim to enforce the settlement agreement should be asserted in that court under the original cause number, such as through an amended pleading or counterclaim. See id.; see also Padilla v. LaFrance, 907 S.W.2d 454 (Tex.1995). The settlement agreement alone is insufficient to provide a basis for judgment because it would deprive a party of the right to be confronted by appropriate pleadings, assert defenses, conduct discovery, and submit contested fact issues to a judge or jury. See Cadle Co. v. Castle, 913 S.W.2d 627, 632 (Tex.App.-Dallas 1995, writ denied). Here, an appropriate motion for summary judgment was presented to enforce the agreement giving appellants the right to meet the allegations in the motion.

A motion for summary judgment is properly granted if the movant establishes that there is no genuine issue of material fact and that he or she is entitled to judgment as a matter of law. Tex.R. Civ. P. 166a(c); City of Houston v. Clear Creek Basin Auth., 589 S.W.2d 671 (Tex.1979); Baubles & Beads v. Louis Vuitton, S.A., 766 S.W.2d 377 (Tex.App.-Texarkana 1989, no writ). The question on appeal is not whether the summary judgment proof raises a fact issue with reference to the essential elements of the plaintiffs cause of action, but whether the summary judgment proof establishes that the movant is entitled to summary judgment as a matter of law. Gonzalez v. Mission Am. Ins. Co., 795 S.W.2d 734, 736 (Tex.1990).

D. Analysis

(1) Is the agreement unenforceable due to failure to specify the parties to be released, when the parties would be released, and the scope of the release?

Jackson argued in her motion for summary judgment that the June 23 letter constituted a Rule 11 agreement and also filed, in support of that motion, the preceding offers and responses that led to that letter. The June 23, 2003, letter states:

Responsive to your letter of June 13, 2003, my chent has authorized me to settle this case as follows:
1) One (1) cash payment of $45,000; and
2) Three (3) cash payments of $10,000 each, payable January 1, 2004, January 1, 2005 & January 1, 2006. These three (3) annual payments are secured by a first hen on the annex property located at 1501 West 29th Street, Tyler, TX.
If this arrangement is acceptable to your chent, please sign below and fax it back to me. If you have any questions or need to discuss this further, please contact me.
Very truly yours,
Henry P. Giessel

The letter was returned signed by Robert J. Scott, Scott & Scott, L.L.P. as “Attorney for Defendants.”

The appellants contend that the June 23 letter, as read alone or ah letters as read together, do not contain all the required elements of the contract. We disagree.

It is not required that all of the terms be contained within a single document. In the leading case of Padilla, 907 S.W.2d at 461, for example, the court found that three letters as read together were the agreement and contained all material terms of that agreement. Similarly, in this case, we have several different letters that were placed in the record. In the May 23 letter, appellants’ counsel wrote to Jackson’s counsel, offering to settle by paying a total of $75,000.00 in return for dismissal of pending litigation with prejudice and a release of all parties (named individually) from liability. The May 23 letter makes it clear that all defendants are to be released from liability in the settlement of this claim. In all of the following correspondence, although settlement was the obvious purpose, the proposed releases were never again explicitly mentioned. The only matter under dispute was the payment. As previously noted, even that argument was not over the amount, but only the way the payment was to be structured.

Looking at the documents as a group, instead of at the June 23 letter in isolation, it is clear that the plaintiffs agreed to release all defendants from their claims against them in return for a specified amount of money, to be paid in specified installments. The only thing that is not expressly set out in that letter is a date for either the transfer of the money or the release.

The law of contracts applies to Rule 11 settlement agreements. Id. at 460; Ronin v. Lerner, 7 S.W.3d 883, 886 (Tex.App.-Houston [1st Dist.] 1999, no pet.). Under contract law, as explicitly applied in cases involving the settlement of lawsuits, it is clear that, if a contract does not state a specific time for performance, a reasonable one will be implied. CherCo Props., Inc. v. Law, Snakard & Gambill, P.C., 985 S.W.2d 262, 266 (Tex.App.-Fort Worth 1999, no pet.); see Moore v. Dilworth, 142 Tex. 538, 179 S.W.2d 940, 942 (1944).

The same scenario as exists in this case was addressed in Atlantic Lloyds Insurance Co. v. Butler, 137 S.W.3d 199 (Tex.App.-Houston [1st Dist.] 2004, pets, denied [2 pets.]). In that case, the, appellate court recognized that the intent was obviously to settle a case, that there was no reasonable question the attorneys for all parties were aware of the identities of the plaintiffs and the nature of their claims, and that contemporaneous performance was implied by the agreement — and rendered summary judgment so ordering. Id. at 212.

(2) Was the agreement ambiguous concerning the parties bound?
(3) Do the individual defendants’ affidavits create material issues of fact?

Counsel for the appellants signed the June 23 letter as “Attorney for Defendants.” However, in the body of the agreement, the term “client” is used in the singular rather than the plural. Appellants argue that, even though the agreement was signed by counsel for all the defendants, the individual defendants agreed only to $75,000.00 being paid by their employer. This argument is supported by directing us to the affidavits of the individuals, in which they stated they had approved a settlement of $75,000.00 payable by their employer, not individually. It is also argued that counsel’s use of the word “client” instead of “clients” in the June 13 letter is necessarily dispositive because it reflects that only one of the clients agreed to settle.

Enforceable Rule 11 agreements may be signed by counsel, and the signature of the individual parties to the suit is not required. See W. Beach Marine, Ltd. v. Erdeljac, 94 S.W.3d 248, 255 (Tex.App.-Austin 2002, no pet.). Jackson argues that, in light of the pleadings in the lawsuit, the fact that the same counsel represented all defendants, and the otherwise complete consistency of the prior (and later) communications as covering all defendants, and their agreement to release all defendants, the omission of the “s” was nothing more than a typographical error. Further, the affidavits of the individual defendants do not raise the issue of a failure to agree to settle the suit, but only that their employer was to pay the settlement. The issue of allocation is one to be sorted out among the various defendants, and not an essential element of the contract as would require the agreement of the plaintiff. Reading the documents together, the ágreed-on payment serves to require the release of all defendants, not just one.

It is clear from appellants’ summary judgment response, as well as the affidavits of the individuals involved, that they all agreed to the settlement, and also that they agreed among themselves how the payment money would be allocated. Their sole complaint is that no document approved by the plaintiffs contains that information.

The question of how the monies with which the settlement was to be paid would be allocated among the various defendants is not a matter requiring agreement of the plaintiffs. In the absence of some special circumstance that might cause this to be of importance, any agreement they might (or might not) reach is irrelevant to the plaintiff — the source of the actual money paid was not a concern of the plaintiff. It is not a subject that either must or necessarily should be included in the settlement agreement, and is not an essential element of the agreement. See Cantu v. Moore, 90 S.W.3d 821, 825 (Tex.App.-San Antonio 2002, pet. denied); Ronin, 7 S.W.3d 883. The evidence establishes that Jackson is entitled to summary judgment.

We affirm the judgment.

      . TexJR.. Civ. P. 11 provides as follows:
      Unless otherwise provided in these rules, no agreement between attorneys or parties touching any suit pending will be enforced unless it be in writing, signed and filed with the papers as part of the record, or unless it be made in open court and entered of record.


text:
    IRA RESOURCES, INC., et. al., Appellants, v. Enrique Juan GRIEGO and Sonya Griego, Appellees.
    No. 13-04-101-CV.
    Court of Appeals of Texas, Corpus Christi-Edinburg.
    March 31, 2005.
    Rehearing Overruled May 5, 2005.

      Charles C. Murray, Lisa Powell, Atlas & Hall, L.L.P., McAllen, Sparber Rudolph Annen, Richard J. Annen, Todd R. Gabriel, San Diego, CA, for appellants.
    James H. Miller, Houston, Roberto J. Yzaguirre, Jose E. Chapa, Jr., Yzaguirre & Chapa, Manuel Guerra, III, McAllen, for appellees.
    Before Chief Justice VALDEZ and Justices CASTILLO and GARZA.
   OPINION

Opinion by

Justice GARZA.

In this interlocutory appeal, IRA Resources, Inc., Eldorado Bank, and California Bank and Trust (as successor in interest to Eldorado Bank) challenge the trial court’s denial of then special appearances. See Tex. Civ. PRAC. & Rem.Code Ann. § 51.014(a)(7) (Supp. Vernon 2004-05). Because we conclude that the trial court has specific jurisdiction over IRA Resources but no jurisdiction over Eldorado Bank or California Resources, the trial court’s ruling is affirmed in part and reversed and rendered in part.

I. Background

This case arises from the alleged sale of an unregistered security. In April 2001, Abraham Martinez approached Enrique and Sonya Griego about an investment earning a guaranteed annual return of 14%. The investment would work as follows. Martinez, acting on behalf of SPA Marketing, LLC (“SPA”), would sell the Griegos a number of “Customer Owned Coin Operated Telephones” owned by American Telecommunications Company, Inc. (“ATC”). The Griegos would then enter a service contract with Alpha Tel-Com, Inc. (“Alpha”), ATC’s parent corporation, under which Alpha would “perform virtually all services required to maintain the pay telephones in good working order.” In exchange, Alpha would receive 70% of the adjusted gross revenue generated by the telephones and ATC would disburse the balance of the revenue to the Griegos. In the event the Griegos became dissatisfied with the arrangement, ATC would buy back the telephones according to a fixed price schedule.

The Griegos were interested in the investment and agreed that Enrique Griego would purchase five telephones for $5,000 apiece, but they wanted to use qualified retirement funds for the purchase. Martinez advised the Griegos that in order to hold the telephones in an individual retirement account (“IRA”), they would need to roll the IRA into a self-directed IRA administered by IRA Resources, Inc. and Eldorado Bank, California corporations with their primary places of business in San Diego County, California. According to the Griegos, Martinez claimed that as an agent of IRA Resources and Eldorado Bank, he was authorized to open accounts for them with the companies. He provided the Griegos with forms to execute the rollover. He also provided them with an investment directive to purchase five telephones from ATC and an indemnity agreement in favor of IRA Resources and Eldorado Bank. Enrique Griego completed the forms provided by Martinez and tendered a check for $25,500 payable to IRA Resources c/o Eldorado Bank and a money order for $50 payable to IRA Resources. Everything was then forwarded to IRA Resources.

After receiving the application, IRA Resources retained the $50 money order as an account initiation fee and opened a self-directed IRA for Enrique Griego. Grie-go’s check for $25,500 was deposited with Eldorado Bank in a general account for the benefit of self-directed IRA holders. Pursuant to Griego’s investment directive, IRA Resources issued a check in the amount of $25,000 payable to ATC for the purchase of five telephones. Title to the telephones was granted to “Eldorado Bank Trust FBO Enrique Griego, SEP # 153731SE.” The $500 difference between the $25,500 check issued by Enrique Griego to IRA Resources and the $25,000 check issued by IRA Resources to ATC remained deposited in the general account with Eldorado Bank.

As the administrator of Griego’s self-directed IRA, IRA Resources promised to provide certain record-keeping services. For instance, it promised to issue quarterly statements regarding the performance of the investments held in Griego’s self-directed IRA and was obligated to report the IRA’s income to the Internal Revenue Service.

Sometime in June 2001, ATC ceased making payments to the owners of telephones subject to service agreements with Alpha. Subsequently, IRA Resources informed ATC that it would not process any more account applications directing investments in ATC until ATC met its obligations to IRA Resources’ existing clients.

In September 2003, Enrique and Sonya Griego filed a second amended original petition in the 332nd District Court of Hidalgo County, naming IRA Resources, Eldorado Bank, and California Bank & Trust (as successor in interest to Eldorado Bank) as defendants. The petition alleged that the sale and service agreements between Griego, ATC, and Alpha constituted the illegal sale of an unregistered security in violation of the Texas Securities Act. See Tex.Rev.Civ. Stat. Ann. art. 581-4 (Vernon Supp.2004-05) (defining “security”). The petition further alleged that the defendants violated article 581-33 of the securities act through their participation in the illegal sale by providing financial services that were necessary for the transaction and by aiding and abetting ATC and Alpha in a scheme to defraud investors by allowing their names, reputations, and stability to be used to promote the sale of the unregistered security. See Tex.Rev.Civ. Stat. Ann. art. 581-33 (Vernon Supp.2004-05).

The defendants responded by filing special appearances, claiming that they would be denied due process if required to submit to the trial court’s jurisdiction. The trial court denied the special appearances, and this appeal ensued.

II. Standard of Review

Whether a court has personal jurisdiction over a defendant is a question of law. Am. Type Culture Collection v. Coleman, 83 S.W.3d 801, 805-06 (Tex.2002). In resolving this question of law, a trial court must frequently resolve questions of fact. Id. at 806. On appeal, the trial court’s ruling on a special appearance is subject to de novo review, but appellate courts may be called upon to review the trial court’s resolution of a factual dispute. Id. When the trial court does not issue findings of fact, reviewing courts should presume that the trial court resolved all factual disputes in favor of its judgment. Id. A trial court’s resolution of disputed factual issues can be challenged on both factual and legal sufficiency grounds. BMC Software Belg., N.V. v. Marchand, 88 S.W.3d 789, 794 (Tex.2002).

III. Personal Jurisdiction over Nonresident Defendants

The plaintiff bears the initial burden of pleading allegations sufficient to bring a nonresident defendant within the provisions of the long-arm statute. Am. Type Culture, 83 S.W.3d at 807 (citing McKanna v. Edgar, 388 S.W.2d 927, 930 (Tex.1965)). But upon filing a special appearance, the nonresident defendant assumes the burden to negate all the bases of personal jurisdiction alleged by the plaintiff. Id. (citing Kawasaki Steel Corp. v. Middleton, 699 S.W.2d 199, 203 (Tex.1985) (per curiam)).

A. IRA Resources

1. Texas Long-Arm Statute

We begin with the Texas long-arm statute, which must confer jurisdiction over IRA Resources in order for jurisdiction to be proper. See Marchand, 83 S.W.3d at 795 (“The Texas long-arm statute governs Texas courts’ exercise of jurisdiction over nonresident defendants.”). The Texas long-arm statute permits Texas courts to exercise jurisdiction over a nonresident defendant that “does business” in Texas and lists some activities that constitute “doing business.” Id. (citing Tex. Civ. PRAC. & Rem.Code Ann. § 17.042 (Vernon 1997)). A nonresident does business in Texas, for instance, if it “contracts by mail or otherwise with a Texas resident and either party is to perform the contract in whole or in part in this state.” Tex. Civ. PRAC. & Rem.Code Ann. § 17.042(1). The parties do not dispute that IRA Resources contracted with Enrique Griego by mail. Griego performed his part of the contract in Texas by mailing his payment for IRA Resources’ services from Texas. We therefore conclude that IRA Resources did business in Texas and that Texas courts have jurisdiction over IRA resources under the long-arm statute.

2. Minimum Contacts

Next, we must determine whether the exercise of jurisdiction over IRA Resources is constitutional under the Due Process Clause of the Fourteenth Amendment. See Am. Type Culture, 83 S.W.3d at 806. The first component of this inquiry is the nonresident’s contacts with the forum state. See Marchand, 83 S.W.3d at 795. Our objective is to protect the nonresident from being haled into court when its relationship with Texas is too attenuated to support jurisdiction. Am. Type Culture, 83 S.W.3d at 806 (citing Schlobohm v. Schapiro, 784 S.W.2d 355, 357 (Tex.1990)). The nonresident must have the “minimum contacts” necessary to give rise to either specific or general jurisdiction. See Mar-chand, 83 S.W.3d at 795-96 (citing Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 413-14, 104 S.Ct. 1868, 80 L.Ed.2d 404 (1984); Guardian Royal Exch. Assurance., Ltd. v. English China Clays, P.L.C., 815 S.W.2d 223, 226 (Tex.1991)). Although the Griegos maintain that the contacts in this case are sufficient to create both specific and general jurisdiction, their allegations are more consistent with specific jurisdiction. We therefore begin with specific jurisdiction.

When specific jurisdiction is asserted, the minimum contacts analysis focuses on the relationship among the defendant, the forum, and the litigation. Guardian Royal, 815 S.W.2d at 228. Specific jurisdiction over a nonresident defendant exists if (1) the defendant’s contacts with the forum are purposeful and (2) the cause of action arises from or relates to those contacts. Am. Type Culture, 83 S.W.3d at 806 (citing Guardian Royal, 815 S.W.2d at 227).

According to the Griegos, IRA Resources had direct and purposeful contacts with Texas through Martinez, its agent, who sold the services of IRA Resources to them in Texas. IRA Resources accepted and processed the account application and other paperwork given to Enrique Griego by Martinez in Texas and completed by Griego in Texas. It also accepted Enrique Griego’s account initiation fee of $50, which was mailed from Texas. IRA Resources promised to perform record-keeping services for Griego’s self-directed IRA and subsequently sent him periodic statements of account activities. IRA Resources also provided similar services for at least twenty-four other Texas residents who invested in ATC through self-directed IRAs that it administers.

The Griegos further contend that their cause of action against IRA Resources arises from and relates to the company’s contacts with Texas. They allege that IRA Resources participated in and aided and abetted the sale of an unregistered security by, among other things, providing services that were necessary for the transaction. The Griegos claim they could not have purchased the telephones with qualified retirement funds without a self-directed IRA account administered by a third party. IRA Resources provided this service and purchased the telephones on behalf of Enrique Griegos. The cause of action now asserted by the Griegos arises from and relates to the contacts flowing from these services.

In response, IRA Resources maintains that the Griegos have failed to produce “any evidence” that Martinez was its agent. It argues that Martinez’s actions should therefore not be considered as a basis for exercising jurisdiction. See Am. Type Culture, 83 S.W.3d at 806 (“a defendant [cannot] be haled into a Texas court for the unilateral acts of a third party”). According to IRA Resources, the facts alleged by the Griegos are insufficient to create specific jurisdiction.

Because the parties dispute whether Martinez was an agent of IRA Resources, an issue which will affect our minimum contacts analysis, we turn to the applicable agency principles to resolve the issue.

Agency will not be presumed. Happy Indus. Corp. v. Am. Specialties, Inc., 983 S.W.2d 844, 852 (Tex.App.-Corpus Christi 1998, pet. dism’d w.o.j.). Apparent agency, the theory advanced by the Griegos, exists where the principal’s conduct would lead a reasonably prudent person to believe that the agent possessed the authority to act on behalf of the principal. See NationsBank, N.A. v. Dilling, 922 S.W.2d 950, 953 (Tex.1996) (per curiam); Maccabees Mut. Life Ins. Co. v. McNiel, 836 S.W.2d 229, 232-33 (Tex.App.-Dallas 1992, no writ). To establish apparent authority, one must show that a principal either knowingly permitted an agent to hold itself out as having authority or showed such lack of ordinary care as to clothe the agent with indicia of authority. Dilling, 922 S.W.2d at 952-53 (citing Ames v. Great S. Bank, 672 S.W.2d 447, 450 (Tex.1984)). A court may consider only the conduct of the principal leading a third party to believe that the agent has authority in determining whether an agent has apparent authority. Id. at 953 (citing Southwest Title Ins. Co. v. Northland Bldg. Corp., 552 S.W.2d 425, 428 (Tex.1977)).

As it relates to the issue of agency, we construe IRA Resources’ challenge to be a “no-evidence” or legal sufficiency challenge. When reviewing a legal-sufficiency point, we consider only the evidence and inferences that tend to support a finding and disregard all evidence and inferences to the contrary. N. Am. Refractory Co. v. Easter, 988 S.W.2d 904, 908 (Tex.App.-Corpus Christi 1999, pet. denied). If there is any evidence of probative force to support the finding (i.e., more than a scintilla), we will overrule the issue. Id.

The Griegos have not produced legally sufficient evidence to establish that Martinez was acting as an apparent agent for IRA Resources when he offered the services of IRA Resources to the Griegos. There is no evidence that IRA Resources was aware or had reason to be aware of Martinez’s actions. Furthermore, the Griegos have failed to identify any conduct on the part of IRA Resources that would lead a reasonably prudent person to conclude that Martinez had authority to act on behalf of IRA Resources. In fact, the only conduct by IRA Resources that is part of the Griegos’ theory of agency is the company’s acceptance of Enrique Griego’s account application; however, this conduct does not tend to show that IRA Resources was aware of Martinez’s involvement in the transaction or that IRA Resources approved of such involvement. There is no evidence that Martinez completed the forms for Enrique Griego, that he mailed the forms to IRA Resources for Griego, or that the forms included any indication of Martinez’s involvement. For the limited purpose of reviewing the trial court’s ruling on IRA Resources’ special appearance, we conclude that Martinez was not an agent for IRA Resources. A finding of jurisdiction cannot be based on his actions. See Am. Type Culture, 83 S.W.3d at 806.

Having concluded that Martinez was not an apparent agent of IRA Resources, we must decide whether the remaining, undisputed contacts are sufficient to confer specific jurisdiction. We conclude that they are. IRA Resources’ contacts were purposeful, see Am. Type Culture, 83 S.W.3d at 806; they increased the company’s revenues and profits by generating increased fees from a Texas resident. IRA Resources knew its fees were coming from Texas because the application filed by Griego listed his address in Texas. With full knowledge that it was contracting with a Texas resident, IRA Resources agreed to act as the administrator of Grie-go’s self-directed IRA, accepted his account initiation fee, created an account for him, and purchased telephones from ATC on his behalf. The cause of action asserted against IRA Resources arises from and relates to these contacts. See id. The Griegos allege that IRA Resources participated in and aided and abetted the sale of an illegal security by, among other things, selling services that were necessary to accomplish the transaction. Accordingly, we conclude that IRA Resources purposefully availed itself of the privilege of conducting business in Texas and could have reasonably anticipated being haled into a Texas court. See Gen. Elec. Co. v. Brown & Ross Int’l Distribs., Inc., 804 S.W.2d 527, 531 (Tex.App.-Houston [1st Dist.] 1990, writ denied) (holding that nonresident defendant who “expected to profit from its activities ... [in Texas] and ... received a benefit from Texas residents ... could reasonably have assumed that a Texas court might call”).

3. Fair Play and Substantial Justice

In addition to minimum contacts, due process requires that the maintenance of the suit not offend “traditional notions of fair play and substantial justice,” Am. Type Culture, 83 S.W.3d at 806 (quoting Int’l Shoe Co. v. Washington, 326 U.S. 310, 316, 66 S.Ct. 154, 90 L.Ed. 95 (1945)); however, only in rare cases will the exercise of jurisdiction not meet this test when the nonresident defendant has purposefully established minimum contacts with the forum state, Guardian Royal, 815 S.W.2d at 231. This is not one of those cases.

The Griegos have alleged that the exercise of jurisdiction over IRA Resources will not offend traditional notions of fair play and substantial justice for five reasons: (1) IRA Resources will not be substantially burdened; (2) Texas has a strong interest in protecting its residents who purchase securities; (3) Texas is a convenient forum; (4) a Texas court can efficiently resolve the controversy and promote the policies implicated by the Texas Securities Act; and (5) Texas has an interest in providing an effective means of redress for its residents. See id. (listing five factors that should be considered, as appropriate, in determining whether the maintenance of a suit offends traditional notions of fair play and substantial justice).

Although “it is incumbent upon the defendant to present ‘a compelling case that the presence of some consideration would render jurisdiction unreasonable,’” IRA Resources has presented no such arguments. See id. Consequently, it has failed to negate jurisdiction on this basis. See Am. Type Culture, 83 S.W.3d at 807 (“upon filing a special appearance, the nonresident defendant assumes the burden to negate all the bases of personal jurisdiction alleged by the plaintiff’). We conclude that the trial court did not err in denying the special appearance filed by IRA Resources.

B. Eldorado Bank

1. Texas Long-Arm Statute

The Griegos contend that jurisdiction over Eldorado Bank is proper under the Texas long-arm statute because Eldorado Bank engaged in business in Texas by acting as an account custodian for the self-directed IRA accounts administered by IRA Resources. See Marchand, 83 S.W.3d at 795. Because the requirements of the Texas long-arm statute are met only if the concerns of due process are satisfied, we proceed directly to the minimum contacts analysis without passing on the issue of whether the- allegations against Eldorado Bank amount to conducting business in Texas under the long-arm statute. See Guardian Royal, 815 S.W.2d at 226.

2. Minimum Contacts

The Griegos allege that Eldorado Bank’s contacts with Texas are sufficient to create both specific and general jurisdiction. We disagree.

We begin with specific jurisdiction. Where, as here, there are multiple defendants, we must test each defendant’s actions and contacts with the forum separately. Shapolsky v. Brewton, 56 S.W.3d 120, 132 (Tex.App.-Houston [14th Dist.] 2001, pet. denied). Contrary to the spirit of this directive, the Griegos have lumped Eldorado Bank’s contacts together with those of IRA Resources. For instance, the Griegos allege that both Eldorado Bank and IRA Resources accepted payment for fees charged to Enrique Griego, sent periodic statements to Griego, and promised to prepare tax documents showing activity in his account. In addition, the Griegos contend that Martinez was an apparent agent of both IRA Resources and Eldorado Bank.

We address this last contention first. For reasons similar to those stated above regarding IRA Resources, we conclude that there is legally insufficient evidence to prove that Martinez was an apparent agent of Eldorado Bank. The Griegos simply have not produced any evidence upon which a reasonably prudent person could conclude that Martinez had authority to act for Eldorado Bank. The only conduct by Eldorado Bank that is identified in the Griegos’ theory of agency is the opening of an account for IRA Resources; however, this conduct in no way indicates that Eldorado Bank approved of or authorized Martinez’s actions in soliciting business from the Griegos. See Dilling, 922 S.W.2d at 953 (“A court may consider only the conduct of the principal leading a third party to believe that the agent has authority in determining whether an agent has apparent authority.”). In fact, there is no evidence whatsoever that Eldorado Bank was even aware of Martinez’s actions. Accordingly, we will not impute Martinez’s actions to Eldorado Bank for the purpose of determining jurisdiction.

The remaining contacts alleged by the Griegos are unsubstantiated by the record. There is no evidence that Eldorado Bank ever collected a fee from the Griegos, sent statements to the Griegos, or promised to file tax documents on their behalf. To the contrary, the evidence shows that Eldorado Bank never had any contact with the Griegos but instead dealt directly and exclusively with IRA Resources. In fact, the record shows that Enrique Griego has never had an account with Eldorado Bank. Rather, IRA Resources has a general account with Eldorado Bank in which the funds of self-directed IRA holders, including those of Enrique Griego, are intermingled. Although it might be reasonable to infer that Eldorado Bank profited by Griego’s relationship with IRA Resources, such random, fortuitous, and attenuated contact with Texas is insufficient for specific jurisdiction. We conclude that Eldorado Bank’s contacts with Texas were not purposeful and that the exercise of specific jurisdiction would violate the Due Process Clause of the Fourteenth Amendment.

Next, we turn to the requirements for general jurisdiction. General jurisdiction allows a forum to exercise jurisdiction over a defendant even if the cause of action did not arise from or relate to a defendant’s contacts with the forum. Am. Type Culture, 83 S.W.3d at 806-07 (citing Guardian Royal, 815 S.W.2d at 228). General jurisdiction is present when a defendant’s contacts with a forum are “continuous and systematic,” a more demanding minimum-contacts analysis than specific jurisdiction. Id. (citing Guardian Royal, 815 S.W.2d at 228).

The Griegos have failed to establish the continuous and systematic contacts necessary for general jurisdiction. The only evidence submitted by the Griegos to prove general jurisdiction is a report from the website of the Texas Secretary of State indicating that Eldorado Bank has filed five UCC financing statements in Texas, reflecting its status as a “secured party.” From this evidence, the Griegos ask that we infer Eldorado Bank has continuously and systematically conducted banking business in Texas by loaning money to Texas businesses and securing those loans by filing mortgages and financing statements in Texas. We will not do so.

Although the parties have cited no cases from Texas courts on the issue of whether the filing of financing statements constitutes continuous and systematic contacts, courts from other jurisdictions have resoundingly rejected any such possibility. In Soma Med. Int’l v. Standard Chtd. Bank, for instance, the Tenth Circuit held that under Utah law, the filing of financing statements and the recording of other instruments was not the kind of substantial and continuous activity necessary to subject a nonresident defendant to general jurisdiction. Soma Med. Int’l v. Standard Chtd. Bank, 196 F.3d 1292, 1296 (10th Cir.1999). Other courts have reached similar conclusions. See Neb. Beef, Ltd. v. KBK Fin., Inc., 288 F.Supp.2d 985, 988-89 (S.D.Iowa 2003) (holding that nonresident’s filing of a financing statement in forum state, transfer of $71 million into forum state, and purchase of $71 million of accounts receivable from company located in forum state were not continuous and systematic contacts); Occidental Fire & Cas. Co. v. Cont’l Ill. Nat’l Bank & Trust Co. of Chicago, 689 F.Supp. 564, 567 (E.D.N.C.1988) (holding that filing of financing statements in North Carolina does not create the minimum contacts necessary for general jurisdiction); Goehring v. Superior Court, 62 Cal.App.4th 894, 78 Cal.Rptr.2d 105, 111-15 (1998) (holding that fifing a financing statement in forum state is insufficient for minimum contacts); NFD, Inc. v. Stratford Leasing Co., 433 N.W.2d 905, 909 (Minn.Ct.App.1988) (holding that no minimum contacts exist based on fifing of financing statement); Ensign v. Bank of Baker, 676 N.W.2d 786, 791 (N.D.2004) (holding that making loans to North Dakota residents and filing financing statements with the North Dakota Secretary of State are not minimum contacts necessary for general jurisdiction).

Having concluded that Eldorado Bank lacks the minimum contacts necessary for either specific or general jurisdiction, we need not decide whether the maintenance of a suit against Eldorado Bank in Texas would offend the traditional notions of fair play and substantial justice. The trial court erred by denying Eldorado Bank’s special appearance.

C. California Bank

For the reasons stated above regarding Eldorado Bank, we also conclude that the trial court erred by denying California Bank’s special appearance, as its liability derives entirely from Eldorado Bank through a successor-in-interest theory. There is no specific jurisdiction over Eldorado Bank and therefore no specific jurisdiction over California Bank. Likewise, the allegations made by the Griegos to establish general jurisdiction over California Bank (namely, the fifing of financing statements in Texas) fail for the same reasons as the allegations against Eldorado Bank.

IV. Conclusion

The trial court’s order denying the special appearances of IRA Resources, Eldorado Bank, and California Bank is affirmed with respect to IRA Resources and reversed and rendered with respect to Eldorado Bank and California Bank.

      . All three individuals are Texas residents.

      . The record does not indicate where the telephones are located.

      .The development of a similar investment and the interrelationship between SPA, Alpha, and ATC is described in SEC v. Rubera, 350 F.3d 1084, 1087-89 (9th Cir.2003).


author: W.G. ARNOT, III, Chief Justice.

text:
    PRIMROSE OPERATING COMPANY, INC., Appellant, v. Wilford C. SENN and Wanda Joan Senn, Appellees.
    No. 11-03-00131-CV.
    Court of Appeals of Texas, Eastland.
    March 31, 2005.
    Rehearing Overruled May 19, 2005.

      See also 55 S.W.3d 222.
    Kathleen M. McCulloch, Shafer, Davis, Ashley, O’Leary & Stoker, P.C., Odessa, Rick G. Strange, Cotton, Bledsoe, Tighe & Dawson, P.C., Midland, for appellant.

      Timothy F. Lee, Paul Smith, Ware, Snow, Fogel & Jackson, L.L.P., Bill Robins III, Heard, Robins, Cloud, Greenwood & Lubel, L.L.P., Houston, for appellees.
    Panel consists of: ARNOT, C.J., and WRIGHT, J„ and McCALL, J.
   Opinion

W.G. ARNOT, III, Chief Justice.

Wilford C. Senn and Wanda Joan Senn brought suit against various oil companies for the alleged contamination of the Senns’ real property, the Covered “S” Ranch. The only defendant remaining in the suit at the time of trial was Primrose Operating Company, Inc. The jury found that Primrose had negligently caused contamination to the surface of the ranch, that the cost to clean up the contamination was $2,110,000, that the diminution in fair market value of the ranch due to Primrose’s contamination was $2,110,000, that Primrose acted with malice, and that exemplary damages should be assessed against Primrose. The trial court entered judgment on the jury’s verdict, awarding the Senns $2,110,000 in actual damages, over $880,000 for prejudgment interest, and $86,000 as punitive damages. We reverse and render.

Primrose presents nine issues for appellate review. In the first issue, Primrose contends that the trial court abused its discretion in granting a partial new trial to the Senns. The record shows that this appeal resulted from the second jury trial of this case. After the first trial resulted in a take-nothing judgment in favor of Primrose, the trial court granted in part the Senns’ motion for new trial and limited the retrial to the issue of Primrose’s liability for surface damages. The trial court judge stated in his order that he was granting the new trial “in the interests of justice and fairness.” In a letter to the parties, the trial judge stated that he was convinced that the jury disregarded their oath even though the jury reached an arguably just result. A trial court’s decision to grant a new trial in a civil case, if rendered during the trial court’s plenary power, is not reviewable on appeal. Cum-mins v. Paisan Construction Company, 682 S.W.2d 285 (Tex.1984); Bay, Inc. v. Ramos, 139 S.W.3d 322, 331 (Tex.App.-San Antonio 2004, pet’n filed). Consequently, we cannot disturb the trial court’s decision to grant the partial new trial in this ease. The first issue is overruled.

In its fourth and fifth issues, Primrose challenges the $2,110,000 findings made by the jury in answer to questions regarding the cost of cleanup and the diminution in fair market value. Primrose asserts that these damage findings were based upon unscientific evidence, were excessive, and were not supported by legally or factually sufficient evidence. The Senns had the burden of proof on these questions. Therefore, in order to address Primrose’s legal sufficiency/no-evidence challenges, we must consider only the evidence and inferences that tend to support the findings, disregarding any evidence or inferences to the contrary. Southwest Key Program, Inc. v. Gil-Perez, 81 S.W.3d 269, 274 (Tex.2002); Garza v. Alviar, 395 S.W.2d 821, 823 (Tex.1965); see Merrell Dow Pharmaceuticals, Inc. v. Hamer, 953 S.W.2d 706, 711 (Tex.1997), cert. den’d, 523 U.S. 1119, 118 S.Ct. 1799, 140 L.Ed.2d 939 (1998). We may sustain a no-evidence challenge only if one of the following circumstances exists: (1) the record discloses a complete absence of evidence of a vital fact, (2) the court is barred by rules of law or of evidence from giving weight to the only evidence offered to prove a vital fact, (3) the only evidence offered to prove a vital fact is no more than a mere scintilla, or (4) the evidence conclusively establishes the opposite of the vital fact. Merrell Dow Pharmaceuticals, Inc. v. Hamer, supra at 711 (citing Robert W. Calvert, “No Evidence” and “Insufficient Evidence” Points of Error, 38 TEX. L. REV. 361, 362-63 (I960)). If there is any evidence of probative force to support the finding, we must overrule the no-evidence point. Juliette Fowler Homes, Inc. v. Welch Associates, Inc., 793 S.W.2d 660, 666 (Tex.1990); In re King’s Estate, 150 Tex. 662, 244 S.W.2d 660 (1951).

In a case in which a surface owner asserts a claim for damage to his land caused by another’s negligence, the type of compensation to be awarded depends on the nature of the injury. North Ridge Corporation v. Walraven, 957 S.W.2d 116, 119 (Tex.App.-Eastland 1997, pet’n den’d). Where the injury is temporary and able to be remedied at reasonable expense, damages are measured by the cost of restoring the land to its condition prior to the injury. North Ridge Corporation v. Walraven, supra. If the cost to restore the land is excessive or not economically feasible, the injury may be deemed to be permanent. North Ridge Corporation v. Walraven, supra. In the case of permanent injuries, the appropriate measure of damages is the diminution in fair market value. North Ridge Corporation v. Walraven, supra. The concepts of temporary and permanent injuries are mutually exclusive. Kraft v. Langford, 565 S.W.2d 223 (Tex.1978). Consequently, damages for both may not be recovered in the same action. Kraft v. Langford, supra.

We hold as a matter of law that the cost to restore the land to its condition prior to the leaks at issue in this case is not reasonable and that the repairs are, thus, not “economically feasible.” See North Ridge Corporation v. Walraven, supra; Atlas Chemical Industries, Inc. v. Anderson, 514 S.W.2d 309 (Tex.Civ.App.-Texarkana 1974), affd, 524 S.W.2d 681 (Tex.1975). The record shows that Primrose owned an oil and gas lease covering about 3,000 acres of the Senns’ 23,013-acre ranch. The Senns purchased the surface only of the ranch in June 1997 for $3,164,000. The ranch has been subject to various leases and to oü and gas production since 1939 when the discovery well was drilled. AVhen the Senns purchased the ranch, hundreds of wells had been drilled on the leased portion of the ranch, and thousands of miles of flow lines crossed the area. According to Wilford Senn (Senn), 500-600 wells were located on his ranch, with approximately 200 of those belonging to Primrose. Primrose began its operations on the ranch in 1992 and vacated the premises in December 1999 when it sold its interest to another company. Sometime after the Senns purchased the ranch, Senn instructed his ranch foreman, Rudy Gonzalez, to photograph any leaks or spills that he observed and to report those leaks and spills to Eddie W. Seay, a regulatory environmental consultant hired by Senn. Senn also hired a chemist, Greg Bybee, to take soil samples of these sites, test for contaminants, and determine the cost of remediation. The samples taken of the 86 Primrose spill sites, which were mostly leaks from flow lines, showed high levels of petroleum hydrocarbons and/or chlorides from the oil and saltwater. According to the Senns’ experts, Primrose failed to properly clean up the spill sites. The record showed that the spill sites had not adequately revegetated by the time of trial, but there was no showing that the spill sites resulted in any hazard to human or animal life or even that the sites interfered with Senns’ use of the ranch. The Senns’ experts testified that the soil in those spill sites, which covered a total of approximately 10 acres but were spread out across the area, needed to be remediated by digging out the contaminated dirt, hauling it to a land farm, and replacing the contaminated dirt with clean soil. Bybee testified that the cost of such remediation would be $2,110,000.

Various witnesses testified regarding the value of the Senns’ ranch. When Senn purchased the ranch in June 1997 for $3,164,000, there were some old spills and some oil operation damage. At the time of purchase, the appraised value was a little over $3,100,000. In July 1998 and again in February 2000, Senn swore in his financial statements that the ranch was worth $3,600,000. In May 2000, Senn swore in another financial statement that the ranch was worth $4,200,000. Also in May 2000, Lee Sam Middleton, a real estate broker and appraiser hired by the Senns, appraised the ranch with improvements at $4,275,000. When Middleton inspected and appraised the ranch in 1997 and in 2000, he knew that there had been oil field activity on the ranch, but he appraised the ranch as if it were unaffected by environmental hazards. Middleton testified that, at the time of the appraisals, he was not aware of any environmental hazards that needed to be cleaned up. Middleton further testified that, if the Senns’ ranch is contaminated and if the cost to clean up the contamination is $2,110,000, then the fair market value of the ranch would be diminished by $2,110,000 — the “cost to cure.” Middleton testified that the evaluation should be based upon the cost to cure.

Steven Rogers, a real estate appraiser from Amarillo, appraised the Senns’ ranch in March 2001 and October 2002. Rogers testified that, if the ranch were environmentally clean, it would have been valued at $4,500,000 and $4,800,000 on those dates, respectively. Rogers testified that he reviewed the report prepared by Seay and Bybee regarding soil contamination on the ranch and that, based upon that study, Rogers believed that the market value of the ranch would be diminished by both the cost to cure, $2,110,000, and by the negative stigma attached to the contamination, $420,000. According to Rogers, stigma is “the resistance of the market place to the purchase, or under a more likely description, it is a margin that ... any purchaser of the property would like to have above the actual cost to clean up.” The stigma value is attached because the cost to cure is generally imprecise and may cost more than expected. Rogers testified that he allotted 20 percent of the cost to cure as stigma. After allowing for both the improvements made by the Senns and the deductions for the stigma and the cost to cure, Rogers valued the ranch at $2,500,000. On cross-examination, Rogers admitted that the authoritative literature that he uses to appraise land provides that not all hazardous substances result in contamination; that, even if contamination does occur, the contamination does not necessarily create an environmental risk; and that, even if contamination results in an environmental impact or environmental risk, there is not necessarily an impact on the marketability of the real estate.

Middleton and Rogers testified at trial about the recent sale of another nearby ranch. That ranch, despite 25 percent of its 19,000 acres being subject to oil and gas activity, sold for $217-218 per acre. Middleton testified that the Senns’ ranch was superior in comparison. The record also showed that Scurry County, where the Senns’ ranch is located, is and has been one of the top producing counties for oil and gas in the United States.

The only other witness to testify regarding market value was Clint Bumguardner, a real estate appraiser hired by Primrose. Bumguardner testified that he did not use the cost to cure in appraising the Senns’ ranch. According to Bumguardner, the cost to cure was not appropriate in this case because the oil field activity on the Senns’ ranch was typical for that area of Texas and did not impact the property and because cost to cure is only utilized when it is economically feasible. Bumguardner did not find that the market value of the Senns’ ranch had diminished in value because of Primrose’s activities. Bumguard-ner did not attach any stigma loss to the Senns’ ranch because it continued to thrive and be used as a ranch, which was the highest and best use of that property. Also, according to Bumguardner, the market for similar ranches reflected that there was no stigma attached to the oil field activity. On June 15, 2001, Bumguardner appraised the ranch’s fair market value considering comparable ranch sales and the oil field activity at $175 per acre for a total of $4,025,000.

We hold as a matter of law that the cost to restore the land to its condition prior to the leaks at issue in this case is not reasonable and that the repairs are, thus, not “economically feasible.” See North Ridge Corporation v. Walraven, supra; Atlas Chemical Industries, Inc. v. Anderson, supra. Accordingly, whether injury was temporary or permanent, the proper measure of damages in this case was the diminution in fair market value. See North Ridge Corporation v. Walraven, supra. That issue was addressed during the trial and was submitted to the jury. In accord with the testimony of Senns’ experts, the jury found that the diminution in fair market value was $2,110,000. However, the only evidence in support of that figure was the testimony that the market value had diminished by $2,110,000 because that was the cost to cure — the amount of money that would have to be expended to remediate Primrose’s spill sites and return them to an uncontaminated condition.

First, we are barred from considering that evidence because the cost to cure is an improper measure of damages in this case. The $2,110,000 that it would cost to excavate, haul, and replace the soil on 10 acres of a ranch on which oil and gas producers have been operating for approximately 60 years is not economically feasible. Even the $420,000 stigma amount suggested by Rogers was based upon the cost to cure. Rogers estimated that amount as 20 percent of the cost to cure because the cost to cure is often imprecise.

Second, the testimony of Senns’ experts regarding the diminished market value did not take into account the fact that the land was not pristine when the Senns purchased the ranch. The Senns purchased the land “as is” after observing old spills and some damage from oil and gas operations. As shown by uncontroverted testimony, some leaks and spills are inevitable. At the time of the Senns’ purchase, the oil field located on their ranch was very mature. The flow lines that leaked while Primrose conducted its activities on the ranch had been on the same right-of-ways since the 1940s and 1950s. Furthermore, prior to being banned by the Railroad Commission, open saltwater disposal pits had been located on the Senns’ ranch.

While we do not condone Primrose’s failure to adequately clean up the sites immediately when the cost would have been much less, we hold that the Senns have failed to produce any evidence that their ranch diminished in value because of Primrose’s negligence. The fifth issue is sustained, and the remaining issues need not be addressed. TEX.R.APP.P. 47.1. Because the Senns failed to provide any competent evidence of an essential element of their cause of action, we must reverse the judgment of the trial court and render judgment in favor of Primrose. See Kerr-McGee Corporation v. Helton, 133 S.W.3d 245, 258-60 (Tex.2004).

The judgment of the trial court is reversed, and we render judgment that the Senns take nothing from Primrose.

      . We note that the Texas Supreme Court recently had an opportunity to reexamine this issue but that it did not do so and, instead, reversed on other grounds. Volkswagen of America, Inc. v. Ramirez, 159 S.W.3d 897 (Tex.2004).

      . We note that there was no evidence indicating that the Texas Railroad Commission had cited Primrose for any violations on the Senns’ ranch. Primrose produced testimony showing that neither Senn nor the Railroad Commission ever requested that Primrose take any further action on any spill site.

      . At $217 per acre, the Senns’ acreage would total $4,993,821.