What Does ''Sovereign Immunity'' Mean In Texas ?
As explained by the supreme court in Federal Sign v. Texas S. Univ., 951 S.W.2d 401, 405 (Tex. 1997), sovereign immunity protects the state from lawsuits for damages, absent legislative consent to sue the state. See 951 S.W.2d at 405.
The term "sovereign immunity" actually embraces two principles: immunity from suit and immunity from liability. See id. Immunity from suit bars a legal action against the State, even if the State acknowledges liability to the asserted claim, unless the legislature has given express consent to sue. See id.
Immunity from liability provides that, even if the legislature has given consent to sue, the State may not be adjudged liable for the claim asserted. See id.
When the State enters into a contract with a private entity, it gives up its immunity from liability, but not its immunity from suit. See id.
Federal Sign recognized that there "may be other circumstances where the state may waive its immunity by conduct other than simply executing a contract so that it is not always immune from suit when it contracts." Id. at 408 n.1.
Recognizing the significance of that footnote, this Court has held that Federal Sign leaves room for the State to waive its immunity with regard to a particular contract by its conduct. See Aer-Aerotron, Inc. v. Texas Dep't of Transp., 997 S.W.2d 687, 691 (Tex App.--Austin 1999, pet. filed) (en banc); Little-Tex Insulation Co. v. General Servs. Comm'n, 997 S.W.2d 358, 364 (Tex App.--Austin 1999, pet. filed).
We have held, for example, that the State's acceptance of a benefit under a contract without paying for the benefit may waive immunity from suit. See Little-Tex, 997 S.W.2d at 364; Texas Natural Resource Conservation Comm'n v. IT-Davy, 998 S.W.2d 898, 902 (Tex. App.--Austin 1999, pet. filed).