In Dallas Area Rapid Transit v. Monroe Shop Partners, Ltd., 293 S.W.3d 839 (Tex. App.--Dallas 2009, pet. denied), the contract at issue established that DART (Dallas Area Rapid Transit) would sell, and Monroe would purchase and develop certain historically significant property near a rail station. 293 S.W.3d at 840.
DART terminated the contract when Monroe allegedly failed to obtain the financing required by the contract. Id.
Monroe sued DART for breach of contract, but DART filed a plea to the jurisdiction based on governmental immunity. Id.
Monroe contended that DART's immunity was waived under section 271.152. Id. DART argued that section 271.152 was not applicable because the contract at issue was for the sale of real estate and not one for goods or services. Id. at 841.
The Dallas Court of Appeals disagreed and found that the contract included promises by Monroe to provide certain pre-closing and post-closing development services to DART. Id.
DART argued that the development services in the contract were not for its benefit but for the benefit of the State of Texas as it was the State and not DART that had restricted the use of the historic property. Id.
The Dallas Court of Appeals disagreed and concluded that DART and the State were not mutually exclusive in this context. Id.
The court explained that the contract required Monroe to accept an assignment of DART's responsibilities and restrictions in dealing with the historical nature of the property; get approval from DART on all construction documents related to the renovations; agree that all construction documents would belong to DART; obtain approval from DART on the construction company used by Monroe for the renovations; and perform a list of the specific construction work attached to the contract. Id.
The court concluded that because of the agreement for these services, the contract was subject to the waiver of immunity under section 271.152. Id.