Proper Jurisdiction for Lawsuits Related to Title

The Texas Constitution provides for a county court in each of the 254 counties of Texas, though all such courts do not exercise judicial functions. In the more populous counties, the county judge may devote his or her full attention to the administration of county government. The Legislature has also created statutory county courts at law in more populous counties to aid the single county court in its judicial functions. The legal jurisdiction of the various county-level-trial courts varies depending on the specific statute that created it. Generally, county courts do not have jurisdiction to determine suits related to determining title to land.

A suit “for the recovery of land” is a suit that determines title. See, e.g., Doggett v. Nitschke, 498 S.W.2d 339, 339 (Tex.1973) (“A county court does not have jurisdiction to try questions of title to land.”); Chambers v. Pruitt, 241 S.W.3d 679, 684 (Tex.App.-Dallas 2007, no pet.) (“District courts generally have exclusive jurisdiction to determine title to real property.”). Suits for the recovery of land include more than simply disputes over the identity of the fee simple owner. See, e.g., Coughran v. Nunez, 133 Tex. 303, 127 S.W.2d 885, 887 (1939) (expressing “no doubt” that easements “constitute an interest in real estate,” a dispute over the existence of which “necessarily involved the trial of title to real estate”); Stewart v. Rockdale State Bank, 124 Tex. 431, 79 S.W.2d 116, 118–19 (1935) (county court does not have jurisdiction to determine a claim of homestead, to correct a deed, or to establish whether a tract of land is community property or separate property); State v. Reece, 374 S.W.2d 686, 688 (Tex.Civ.App.-Houston 1964, no writ) (validity of deed restrictions is question of title). A […]

Requirements regarding Seeking Injunctive Relief on Behalf of the Taxpayer Challenging Texas Comptroller of Public Accounts Assessments

Pursuant to Section 112.101(a) of the Texas Tax Code, a taxpayer may bring an action for a restraining order or injunction that prohibits the assessment or collection of a tax or fee imposed or collected by the Texas Comptroller of Public Accounts under any law, including a local tax collected by the comptroller, or a statutory penalty assessed for the failure to pay the tax. As one of the requirements for seeking injunctive relief, Section 112.108 generally requires that the taxpayer pay or provide a bond for the disputed tax.

In 1994 Texas Supreme Court ruled the statute requiring prepayment before seeking relief promulgated by Section 112.108 was unconstitutional. “At the same time, the State has not, however, shown that the complete prohibition of prepayment declaratory relief contained in section 112.108 reasonably serves any governmental interest, let alone one that would override right to open courts.” R Commc’ns, Inc. v. Sharp, 875 S.W.2d 314, 317 (Tex. 1994). As a result of the Supreme Court’s ruling in R Commc’ns, the Legislature modified Section 112.108. However, the modified version of Section 112.108 has also been interpreted to be unconstitutional:
After the amendment became effective, this Court was asked to determine the constitutionality of the modified provision. Rylander v. Bandag Licensing Corp., 18 S.W.3d 296 (Tex.App.-Austin 2000, pet. denied). In Bandag, the trial court declared unconstitutional the amended version of section 112.108. Id. at 303. When considering the issue on appeal, we explained that the “indigency provision” is “irrelevant to the issue of whether that section constitutes an unreasonable financial barrier to access to the courts” and upheld the trial court’s determination that the amended version was unconstitutional. Id. at 304; see also Central Appraisal Dist. v. […]

General Discussion of Entity Formation Options

Limit Your Liability

Without a legal entity, you are operating as a proprietorship, the oldest form of business. A proprietorship can only have one owner, although husband and wife are considered one for this purpose.

If you upset someone, fail to allegedly pay a creditor or vendor, they can come after you personally—which is not a good thing. Although, there are circumstances where creditors can pierce the corporate veil, but this usually requires proof the entity is undercapitalized, underinsured, or otherwise not a commercially reasonable separate entity. With or without an entity, consider buying insurance, including general liability, products liability, employee fidelity, workers’ compensation, unemployment insurance, etc.—it’s all very, very difficult if not impossible.

In other words, to conduct business prudently and responsibly, you need a legal entity.

Partnership Formalities

A partnership can be formed with a handshake, but write it down, as oral agreements often foment serious disputes. With a general partnership each partner has personal liability. A limited partnership has one or more general partners, and one or more limited partners. Limited partners might lose their investment, but their other assets are not at risk. You can even get around the general partner’s unlimited liability by having a corporation (or another entity like an limited liability company) serve as the general partner. To get the benefits of limited partnership treatment, you must file a certificate and pay relevant state fees. Furthermore, if limited partners make day-to-day business decisions, they can wind up with general partner liability. So you may want to consider an a limited liability company (see more below for limited liability companies).

LLCs Are Very Flexible

By far, the most flexible business entity is a limited liability company, commonly referred to as an LLC. Adapted originally from […]