On November 21, 2014, the Supreme Court of Texas reversed the Twelfth Court of Appeals’ judgment in Damuth v. Trinity Valley Community College, a decision that extended governmental immunity against virtually all employment contracts. The Local Government Contract Claims Act (the Act) waives a local governmental entity’s immunity from suit for breach of a services contract subject to the Act. Tex. Loc. Gov’t Code §§ 271.151(2), 271.152. In holding that sovereign immunity was not waived, the Twelfth Court in Damuth explained that teachers/coaches do not provide the type of “services” that justify the waiver of governmental immunity under the Act.
The Supreme Court of Texas disagreed. The court held that Trinity Valley Community College (TVCC) waived its immunity from suit for Damuth’s breach of contract claim by expressly contracting for Damuth’s services. (Damuth entered in to a written employment agreement with TVCC to coach and teach – he was discharged five months into the one year contract). Interestingly, the Supreme Court distinguished Damuth from firefighters, who are subject to the Act, noting that firefighters are civil servants and treated differently from other employees
Pursuant to the Supreme Court’s decision, school districts will no longer be able to rely on governmental immunity as a shield to breach of contract actions brought by teachers and coaches. However, the Damuth holding is not limited to teaching/coaching contracts. Reading the decision broadly, other local governmental entities—not just school districts—may be fair game for a breach of contract suit brought by an employee.
The Supreme Court’s opinion can be viewed here: Damuth, II v. Trinity Valley Cmty. Coll., No. 13-0815, 2014 Tex. LEXIS 1163 (Tex. Nov. 21, 2014) (per curiam).