PKG Contracting, Inc. v. City of Mesquite

Summary

The Supreme Court of Texas held that the City of Mesquite acted in a governmental capacity when it contracted for construction of a storm drainage system. The court concluded that the Local Government Code and the city charter did not clearly and unambiguously waive the City's immunity from suit. Because subsequently enacted statutory provisions might waive immunity for PKG Contracting's contract claims, the court reversed and remanded for further proceedings.

Holdings

1. The City was acting in its governmental capacity when it contracted with PKG to construct a storm drainage system.
2. Section 51.075 and the City's charter provision were not a clear and unambiguous waiver of the City's immunity from suit.
3. PKG was entitled to an opportunity in the trial court to argue that Texas Local Government Code sections 271.152-.154 waived the City's immunity from suit for its claims.

Questions Presented

1. Whether the City of Mesquite acted in a governmental or proprietary capacity when it contracted for construction of a storm drainage system.
2. Whether Texas Local Government Code section 51.075 or the City's charter provision authorizing it to sue, be sued, contract, and be contracted with clearly and unambiguously waived the City's immunity from suit on PKG's contract claims.
3. Whether PKG should be permitted to argue in the trial court that subsequently enacted Local Government Code sections 271.152-.154 waived immunity for its pre-September 1, 2005 contract claims.

Disposition

reversed_and_remanded