In 2012 the City of Dallas entered into a contract with River Ranch Educational Charities, a non-profit organization, to build and operate an equestrian center as part of the city’s Trinity River Corridor Project. The charity did so and opened the center in 2014. Shortly thereafter, the city began sending the charity notices of contract violations, which continued until in 2018 the city notified the charity that it was terminating the contract. When the charity refused to vacate the property, the city sued for injunctive relief and a declaration that the contract was terminated. The charity counterclaimed for breach of contract, breach of the duty of cooperation and non-interference, fraud, and declaratory judgment. The city responded with a plea to the jurisdiction. The trial court denied the plea without stating a reason. The city appealed. Post-Allstate v. Irwin Fallout Evident in Fort Worth Court of Appeals Decision

The court of appeals affirmed, holding that the operation of an equestrian center was a proprietary function not protected by governmental immunity as that term is defined by the Tort Claims Act. Although governmental functions include “parks and zoos,” as well as “recreational facilities, including but not limited to swimming pools, beaches, and marinas,” an equestrian park does not as a matter of law fit under any of those categories. The court agreed with the charity that there was a genuine material issue of fact whether the center was a park or zoo (a place where the public can go for various kinds of recreation and amusement”), especially in view of the fact that the city contracted with a third party to operate it. Additionally, the Dallas City Code defines a “horse park” as a private recreation club that may be built in a flood plain (which the horse park was), and in its agreement with the charity the city disavowed any role in operating, managing, or advertising the center as anything other than the charity’s as an independent contractor.

The bottom line here, as the court of appeals nosed out, was that nothing requires a city to contract with a private entity for an equestrian center. We think the court was particularly unimpressed that the city apparently wanted to have its equestrian center without liability to the city, but at the same time tried exercise a significant amount of control over it. You’re in or you’re out, but you can’t have it both ways.

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