      TEXAS COURT OF APPEALS, THIRD DISTRICT, AT AUSTIN


                                       NO. 03-05-00657-CV



                                    Rudy Cisneros, Appellant

                                                  v.

                        State Board for Educator Certification, Appellee


     FROM THE DISTRICT COURT OF TRAVIS COUNTY, 201ST JUDICIAL DISTRICT
       NO. GN502299, HONORABLE STEPHEN YELENOSKY, JUDGE PRESIDING



                             MEMORANDUM OPINION

               The question in this case is whether the district court had subject matter jurisdiction

to review an administrative order when the party seeking review filed a motion for rehearing from

an earlier order, but not from the final order. The district court concluded that the failure to file a

motion for rehearing from the final order deprived it of jurisdiction and dismissed the appeal. We

agree and affirm.

                                         BACKGROUND

               Appellant, Rudy Cisneros, was employed as a high school teacher by the Valley View

Independent School District. Appellee, the State Board for Educator Certification, sought revocation

of Cisneros’s teaching certificate pursuant to 19 Tex. Admin. Code § 249.15, which provides that

the Board may “revoke or cancel” a teacher’s certificate “upon a determination of satisfactory

evidence that the person is unworthy to instruct or supervise the youth of this state.” 19 Tex. Admin.

Code § 249.15(a)(5), (c)(2) (West 2006). The Board alleged that over a period of several months
during the 2000-2001 school year, Cisneros engaged in an inappropriate romantic and sexual

relationship with one of his students. Cisneros denied these allegations.

               A contested case hearing was held before an administrative law judge, who issued

a proposal for decision (“PFD”) finding that Cisneros had engaged in “inappropriate” conduct with

a student. However, the ALJ disagreed that this conduct was grounds for terminating Cisneros’s

teaching certificate. The ALJ made the following conclusions of law:

       5. [The Board] did not demonstrate by a preponderance of credible evidence that
       Cisneros lacks good moral character and is unworthy to instruct the youth of this
       state. . . .

       6. Based upon the foregoing findings of fact and conclusions of law, [the Board’s]
       petition to revoke the teaching certificate . . . of [Cisneros] should be denied.


               Both the Board and Cisneros filed exceptions to the ALJ’s PFD. Cisneros objected

to the ALJ’s finding that he engaged in “inappropriate” conduct. The Board primarily objected to

the ALJ’s ultimate conclusion that Cisneros’s certificate could not be revoked. Other than making

a minor clarification regarding an incorrect code citation, the ALJ denied both parties’ exceptions

and maintained its recommendation that Cisneros’s certificate not be revoked.

               The Board considered the Cisneros matter and issued a “Final Decision and Order”in

which it accepted the ALJ’s proposed findings of fact but added additional findings of fact regarding

specific instances of Cisneros’s conduct that had not been included in the ALJ’s findings. The Board

also rejected the ALJ’s conclusions of law 5 and 6 and substituted the following:

       5. [The Board] has established by a preponderance of the evidence that Rudy
       Cisneros’s conduct renders him unworthy to instruct or supervise the youth of this
       state, in violation of 19 Tex. Admin. Code § 249.15(c)(2).



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       6. Respondent Rudy Cisneros’s Texas Educator Certificate is subject to sanctions
       pursuant to 19 Tex. Admin. Code § 249.15(c)(2) and § 249.15(a).

       7. The Texas Educator Certificate of Rudy Cisneros is hereby permanently revoked
       pursuant to 19 Tex. Admin. Code § 249.15(a)(5).

In accordance with its findings and conclusions, the Board ordered Cisneros’s teaching certificate

permanently revoked.

               Cisneros timely filed a motion for rehearing of the Board’s decision and order, which

he subsequently amended twice. Cisneros contended that the Board committed error by:

       1) Issuing a Final Order of revocation of [Cisneros’s] certificate after violating
       [Cisneros’s] due process rights to be present and offer response at the [Board’s]
       meeting.

       2) Acting in violation of [19 Texas Admin. Code § 249.39] by failing to state its
       authority to modify or reject the ALJ’s PFD, and furthermore, issuing a Final Order
       with new findings of fact and conclusions of law that is not in compliance with this
       statute.

       3) Acting in violation of the Administrative Procedure Act by failing to state its
       statutory authority to modify or reject the ALJ’s PFD, and furthermore, issuing a
       Final Order with new findings of fact and conclusions of law that is not in
       compliance with Administrative Procedure Act § 2001.058(e) . . . .

       4) Failing to exercise discretion in regards to the ALJ’s recommendation, findings of
       fact and conclusions of law, and issuing an order without consideration of the
       substantial evidence in the record as a whole.

       5) Violating a statutory provision that requires the Board to prove by the
       preponderance of the evidence in the hearing record, that the Respondent, as per
       board definition [19 Tex. Admin. Code § 249.3(55)], is “unworthy of instructing or
       supervising the youth of this state.”

       6) Acting in an arbitrary and capricious manner by proposing, voting, and accepting
       a decision to revoke [Cisneros’s] teaching certificate and then later creating an order
       with new findings of fact and conclusions of law to uphold their decision without
       thoroughly reviewing the record as a whole.



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The Board granted the motion for rehearing, withdrew its original order, and issued an “Order on

Rehearing.” Rather than supplementing the ALJ’s fact findings, the Board’s new order simply

adopted the ALJ’s recommended findings “verbatim and in their entirety.” It also adopted the ALJ’s

recommended conclusions of law, but with the following “modifications”:

       1. Conclusion of law number 5 on page 14 is modified to strike the word “not” with
       conforming changes so that the conclusion of law found by the Board reads as
       follows:

               [The Board] did demonstrate by a preponderance of credible evidence that
               Cisneros lacks good moral character and is unworthy to instruct the youth
               of this state as contemplated in 19 Tex. Admin. Code § 249.15(a) and (c)(2).

       2. Conclusion of law number 6 on page 15 is modified to strike the word “denied”
       and replace it with the word “granted” with conforming changes so that the
       conclusion of law found by the Board reads as follows:

               Based upon the foregoing findings of fact and conclusions of law, [the
               Board’s] petition to revoke the teaching certificate . . . of [Cisneros] should
               be granted.


Based on these findings and conclusions, the new order, like the original, permanently revoked

Cisneros’s teaching certificate.

               It is undisputed that Cisneros timely received a copy of the new order but did not file

a motion for rehearing in response. Instead, he filed a petition for judicial review. In the petition,

Cisneros alleged that the Board:

       1) Violated APA § 2001.141 by issuing Findings of Fact 4 and 5 and Conclusions
       of Law 5 and 6 without substantial evidence and by relying on evidence not part of
       the hearing record before the ALJ.

       2) Acted in violation of the Administrative Procedure Act and in an arbitrary and
       capricious manner in respect to Findings of Fact Numbers 4 and 5 by failing to



                                                  4
        properly modify the technical errors raised by the Petitioner in the ALJ’s Findings of
        Fact as per Administrative Procedure Act § 2001.058(e)(1)(c).

        3) Acted in violation of the statutory provision found in [19 Tex. Admin. Code
        § 249.17], and acted in an arbitrary and capricious manner in regards to the ALJ’s
        recommendation, respective to Findings of Fact Numbers 4 and 5, and without
        consideration of the underlying evidence in the record as a whole in issuing
        Conclusions of Law Numbers 5 and 6.

        4) Violated a statutory provision that requires the Board to prove by a preponderance
        of the evidence in the hearing record, that the Petitioner, as per board definition [19
        Tex. Admin. Code § 249.3(55)], is “unworthy of instructing or supervising the youth
        of this state.”

        5) Acted in violation of [19 Tex. Admin. Code § 249.39] by issuing a Final Order
        that is not in compliance with this statute.

        6) Acted in violation of the Administrative Procedure Act by issuing a Final Order
        that is not in compliance with Administrative Procedure Act § 2001.058(e) . . . .

                The Board filed a plea to the jurisdiction, asserting that Cisneros failed to exhaust his

administrative remedies by not filing a motion for rehearing in response to the Board’s final order.

The district court granted the plea and dismissed the cause for lack of jurisdiction. This pro se

appeal by Cisneros followed.

                                            DISCUSSION

                The sole issue on appeal is whether the district court erred in granting the Board’s

plea to the jurisdiction. Whether the district court has subject matter jurisdiction is a question of law

we review de novo. Mayhew v. Town of Sunnyvale, 964 S.W.2d 922, 928 (Tex. 1998).

                Disciplinary proceedings brought by the Board are governed by the Administrative

Procedure Act (“APA”). Tex. Educ. Code Ann. § 21.041(b)(7) (West 2006). The APA provides

that a person “aggrieved by a final decision in a contested case” is entitled to judicial review of that



                                                   5
decision only after having first “exhausted all administrative remedies available within a state

agency.” Tex. Gov’t Code Ann. § 2001.171 (West 2000). A decision in a contested case is final on

the expiration of the period for filing a motion for rehearing, if a motion for rehearing is not filed on

time. Id. § 2001.144(a)(1) (West 2000). “A motion for rehearing in a contested case must be filed

by a party not later than the 20th day after the date on which the party or the party’s attorney of

record is notified . . . of the decision or order that may become final under Section 2001.144.” Id.

§ 2001.146 (West 2000). A timely motion for rehearing is a prerequisite to an appeal in a contested

case. Id. § 2001.145 (West 2000).

                Cisneros contends that he satisfied the statutory prerequisite to suit by timely filing

a motion for rehearing following the Board’s first order. The Board responds that because it granted

Cisneros’s motion for rehearing and withdrew its first order, the original order was not final, and

Cisneros was required to file a new motion for rehearing in response to the second, final order.1

                This Court has addressed this issue at least twice and both times held that the

petitioner was statutorily required to file a second motion for rehearing following the agency’s

modified order. In Southern Union Gas Co. v. Railroad Commission of Texas, 690 S.W.2d 946

(Tex. App.—Austin 1985, writ ref’d n.r.e.), Southern Union Gas was aggrieved by a decision of the

Railroad Commission that set rates for natural gas service in the City of Borger. Id. at 947. The

Commission signed an order on February 28, 1983. Id. Southern Union Gas timely filed a motion


        1
           The Board claims that its second order “differed substantially from its withdrawn . . .
order.” We need not address the merits of this contention because, for reasons we discuss below,
the “finality of an order does not turn on whether the changes reflected in such a new order are of
a substantial or minor nature.” Ector County Comm’rs Court v. Central Educ. Agency, 786 S.W.2d
449, 450-51 (Tex. App.—Austin 1990, writ denied).

                                                   6
for rehearing from that order. Id. The Commission granted the motion for rehearing “for the limited

purpose of changing the effective date for implementation of the new rates, thereby modifying the

February 28 order.” Id.     It denied the motion for rehearing “in all other respects.” Id.      The

Commission signed its new order on March 28. Southern Union Gas filed no motion for rehearing

in response. Id. Instead, it filed an administrative appeal in Travis County district court. The

Commission filed a plea to the jurisdiction, which the district court granted. Id.

               In affirming the district court’s decision, this Court first noted that a “final order

means an order which leaves nothing open to dispute. So long as matters remain open, unfinished

or inconclusive, there is no final order.” Id. at 948. We then held that an order “cannot be final and

appealable when of fact it has been changed by a subsequent order.” Id. at 948.

               Citing to Illinois law, Southern Union Gas urged us to “draw a distinction between

an agency order changed substantially in response to a motion for rehearing and one changed only

in a minor fashion in response to such motion.” Id. We rejected such an approach:

       This Court doubts the wisdom of a rule that makes finality and appealability of an
       agency order turn upon whether changes effected in the order in response to a motion
       for rehearing are of a substantial or of a minor character. Accordingly, this Court
       declines to tread that mirey bog and will refuse to follow the Illinois rule.

Id. We concluded that it was “not material that the gas company filed a motion for rehearing to the

February 28 order because that order had been modified and therefore was not the agency’s final

order.” Id. at 949.

               Ector County Commissioners Court v. Central Education Agency, 786 S.W.2d 449

(Tex. App.—Austin 1990, writ denied), involved a dispute between Ector County and the

Commissioner of Education relating to a decision regarding detachment and annexation of land in

                                                  7
Midland County. Id. at 449-50. The Commissioner entered an order in 1984 denying Ector County

the right to annex the land. Id. at 450. Ector County filed a motion for rehearing in response to the

Commissioner’s order. Id. Because a factually similar case was proceeding through the appeals

process, the parties agreed to extend the time for the Commissioner to consider the motion for

rehearing. Id. In 1987, the factually similar case was decided by the Texas Supreme Court, and

Ector County reurged its motion for rehearing. Id. The Commissioner overruled the motion but

withdrew the 1984 order and entered a new order that reached the same result as its previous order.

Id. No motions for rehearing were filed in response to the 1987 order. Id. Instead, on January 26,

1988, Ector County filed its petition in district court seeking judicial review of the Commissioner’s

order. Id. The Commissioner filed a plea to the jurisdiction, which the district court denied. Id.

               In reversing the district court’s decision to deny the plea, we rejected Ector County’s

argument that a new motion for rehearing is only required when an agency grants a motion for

rehearing but is not required when an agency denies an initial motion for rehearing. Id. We held that

“because the agency entered a new and different order, Ector County was required to file a new

motion for rehearing in order to seek judicial review of the new order, regardless of whether the

order granted or denied or took no action on Ector county’s motion for rehearing.” Id.

               Ector County also argued that no new motion was required because the 1987 order

“reached the same result” as the 1984 order. Id. We rejected this argument as well:

       However, the record reveals that the legal basis underlying the 1987 order is different
       than that underlying the 1984 order; although the result reached is the same, the two
       orders are not the same. The finality of an order does not turn on whether the
       changes reflected in such a new order are of a substantial or minor nature.




                                                 8
        It is immaterial that Ector County filed a motion for rehearing to the 1984 order,
        because that order was later modified and, therefore, was not the agency’s final order.
        The agency’s final order was the 1987 order. To have properly sought judicial
        review of the 1987 order, Ector County must have filed its motion for rehearing with
        the Commissioner within the specified time after the commissioner rendered it. This
        Ector County failed to do.

Id. at 450-51 (emphasis added) (internal citations omitted).

                Our decisions in both Southern Union Gas and Ector County applied already

established precedent of this Court. See, e.g., Railroad Comm’n of Texas v. Exxon Corp., 640

S.W.2d 343 (Tex. Civ. App.—Austin 1982, writ ref’d n.r.e.); Mahon v. Vandygriff, 578 S.W.2d 144

(Tex. Civ. App.—Austin 1979, writ ref’d n.r.e.). We have continued to follow Southern Union Gas

and Ector County. See, e.g., Office of Pub. Util. Counsel v. Public Util. Comm’n, 843 S.W.2d 718

(Tex. App.—Austin 1992, writ denied); Ross v. Texas Catastrophe Prop. Ins. Ass’n, 770 S.W.2d 641

(Tex. App.—Austin 1989, no writ); El Paso Electric Co. v. Public Util. Comm’n, 715 S.W.2d 734

(Tex. App.—Austin 1986, writ ref’d n.r.e.).

                Cisneros asserts, however, that our decisions in Southern Union Gas and Ector

County have been overruled by the supreme court’s more recent decision in Dubai Petroleum Co.

v. Kazi, 12 S.W.3d 71 (Tex. 2000). Dubai held that failure to meet a statutory prerequisite to suit

will not deprive a trial court of subject matter jurisdiction unless the statute demonstrates a

legislative intent that it do so.2 Id. at 76. The decision did not address whether a motion for




        2
         More recently, the legislature has clarified that “[s]tatutory prerequisites to a suit, including
the provision of notice, are jurisdictional requirements in all suits against a governmental entity.”
Tex. Gov’t Code Ann. § 311.034 (West Supp. 2006).

                                                    9
rehearing in a contested case is jurisdictional. We considered Dubai’s implications for rehearing

motions with agencies in Hill v. Board of Trustees of the Retirement System of Texas:

        Applying the rule in Dubai, we conclude that the timely filing of a motion for
        rehearing is jurisdictional because the filing of the motion for rehearing defines and
        restricts the kind of case a district court may hear—those in which the plaintiff has
        exhausted its administrative remedies and completed the administrative process.

40 S.W.3d 676, 679 (Tex. App.—Austin 2001, no pet.).

                We find no basis in the case law or Cisneros’s brief to question the continued validity

of our holdings in Ector County and Southern Union Gas. Applying these established precedents,

we hold that Cisneros failed to exhaust his administrative remedies prior to filing suit and, therefore,

the district court did not have jurisdiction to review the Board’s decision.

                We would also observe that these principles are not hollow formalities. The purpose

of a motion for rehearing in a contested case is to give the agency notice and an opportunity to

remedy the errors alleged by the party seeking judicial review. Suburban Util. Corp. v. Public Util.

Comm’n, 652 S.W.2d 358, 364 (Tex. 1983); Brown v. Texas Dep’t of Ins., 34 S.W.3d 683, 687 (Tex.

App.—Austin 2000, no pet.). Here, Cisneros alleged two errors in his petition for judicial review

that he did not allege in his rehearing motion: violation of 19 Tex. Admin. Code § 249.17 and

violation of section 2001.141 of the government code. This deprived the Board of notice of these

alleged errors and the opportunity to address them.

                We overrule Cisneros’s issue on appeal.3


       3
           Cisneros argues “in the alternative” that his case “clearly meets primary jurisdiction
exceptions” to the exhaustion of administrative remedies requirement. Cisneros misunderstands the
nature of primary jurisdiction. “The judicially-created primary jurisdiction doctrine operates to
allocate power between courts and agencies when both have authority to make initial determinations

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                                      CONCLUSION

              We affirm the judgment of the district court.



                                                    ____________________________________

                                                    Bob Pemberton, Justice

Before Justices B. A. Smith, Patterson and Pemberton

Affirmed

Filed: December 29, 2006




in a dispute.” Subaru of Am. v. David McDavid Nissan, Inc., 84 S.W.3d 212, 221 (Tex. 2002). That
is not the situation here. Only the Board has authority to make initial determinations about the
suspension or revocation of a teaching certificate. See Tex. Educ. Code Ann. § 21.041(b)(7) (West
2006).

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