      TEXAS COURT OF APPEALS, THIRD DISTRICT, AT AUSTIN


                                       NO. 03-10-00648-CV



               Assignees of Best Buy, Office Max, and CompUSA, Appellants1

                                                  v.

              Susan Combs, State of Texas Comptroller of Public Accounts, and
                     Greg Abbott, Attorney General of Texas, Appellees


    FROM THE DISTRICT COURT OF TRAVIS COUNTY, 201ST JUDICIAL DISTRICT
    NO. D-1-GN-10-001182, HONORABLE MARGARET A. COOPER, JUDGE PRESIDING



                                           OPINION


               This appeal of the trial court’s order granting the appellees’ plea to the jurisdiction

arises from the Assignees’ settlement of two other lawsuits, which were filed as class actions. In

those lawsuits (the “Retailer Suits”), the named plaintiffs sought a refund of Texas sales taxes that


       1
           We will refer to the appellants in this case as the “Assignees.” As we will explain, they
are the individual settlement-class members (except for the named plaintiffs who were appointed the
settlement-class representatives) of settlement classes approved in class actions in which they
obtained assignments to pursue certain retailers’ rights for Texas sales-tax refunds. When the
appellants filed their original notice of appeal, they appealed on behalf of all plaintiffs in the case
below, and the case was styled as Tara Levy, Robert Tycast, Vivian Faywood, John Butler, Rockey
Piazza, Linda Piazza, and Paul Denucci, et al. v. Susan Combs, Comptroller of Public Accounts of
the State of Texas, and Greg Abbott, Attorney General of the State of Texas. They later filed an
amended notice of appeal to indicate that the appeal was filed on behalf of all plaintiffs other than
Tara Levy, Robert Tycast, Vivian Faywood, John Butler, Rockey Piazza, Linda Piazza, and Paul
Denucci, the settlement-class representatives. The appellants have requested that they be designated
as the “Assignees of Best Buy, Office Max, and CompUSA” because the trial court’s dismissal order
does not apply to the settlement-class representatives. We have amended the style of the case to
correctly reflect the parties to this appeal.
they and the putative-class members allegedly overpaid on items purchased from certain Best Buy,

Office Max, and/or Comp USA stores (collectively, the “Retailers”) under mail-in rebate promotions.

The named plaintiffs in the Retailer Suits contended that the Retailers had failed to refund sales tax

to them on the rebated amounts. The Retailers and the putative classes tentatively settled the cases

by agreeing that the Retailers would assign their refund claims to the putative-class members to

allow the individual class members to pursue their assigned refund claims from the Comptroller.2

               In the orders preliminarily approving settlement (“settlement orders”), the trial

courts approved the classes for settlement purposes only and appointed settlement-class counsel

to represent the settlement-class members in the Retailer Suits and in the presentation of

the individuals’ claims to the Comptroller.3 The orders provided that settlement-class counsel was

“given full power of attorney to represent such Settlement Class Members in their individual claims

against the Comptroller.” The settlement-class members, through settlement-class counsel, filed

their assigned claims for refunds with the Comptroller as three aggregated claims, one for

each Retailer. See Tex. Tax Code Ann. § 111.104 (West 2008) (establishing procedure for filing

tax-refund claims).4 Settlement-class counsel requested that the bulk payments be made payable to



       2
         The appellees in this case are Susan Combs, Comptroller of Public Accounts of the State
of Texas, and Greg Abbott, Attorney General of the State of Texas. We refer to them collectively
as the “Comptroller.”
       3
          We will refer to the portions of the settlement orders that appointed settlement-class
counsel to represent the settlement-class members in the presentation of the individuals’ refund
claims to the Comptroller as the “appointment orders.”
       4
         We cite to the current versions of the statutes and administrative code for convenience
because there have been no intervening amendments that are material to our disposition of this
appeal.

                                                  2
the settlement classes for distribution after notice to the class and final approval of the settlements

by the trial courts. The Comptroller’s staff initially denied the claims, and after a contested-case

hearing before an administrative law judge (ALJ), the ALJ recommended that the refund denial be

upheld. The Comptroller issued a ruling denying the refund claims.

               The Assignees (and the settlement-class representatives) then filed this suit under

tax code section 112.151, asserting that the Comptroller erred by (1) denying them authority to

file their refund claims, (2) failing to toll limitations for Assignees whose claims arose within four

years before the Assignees filed their original lawsuit against the Retailers, and (3) rejecting the

Assignees’ documentation of their refund claims. See id. § 112.151 (West Supp. 2011) (allowing

suit for tax refund after denial of claim). The Comptroller filed a plea to the jurisdiction, asserting

that the Assignees did not properly exhaust their administrative remedies because settlement-class

counsel lacked authority to file a refund claim on behalf of the individual settlement-class members.

The trial court granted the plea to the jurisdiction, dismissing the Assignees’ lawsuit.

               The Assignees appeal the dismissal order, arguing that the trial court improperly

sustained the Comptroller’s plea to the jurisdiction, which they contend is an improper collateral

attack on the orders in the Retailer Suits granting preliminary approval to those suits’ settlement.

The Assignees contend that the trial courts had jurisdiction to include pursuit of the individual class

members’ administrative claims before the Comptroller in the scope of class counsel’s duties in the

Retailer Suits. We will affirm the dismissal of the Assignees’ lawsuit against the Comptroller.




                                                  3
                                          BACKGROUND


The Retailer Suits

                Some additional detail about the factual and procedural background of the Retailer

Suits and this lawsuit is necessary to provide context for our decision. In our decision in Levy v.

Office Max, 228 S.W.3d 846, 848-49 (Tex. App.—Austin 2007, no pet.), we provided a brief

history of the Retailer Suits up to the time of that appeal. For our purposes in this appeal, we need

only explain that although the Comptroller had been joined in one of the Retailer Suits (the one

against Best Buy and OfficeMax), she filed a plea to the jurisdiction in that suit, which was granted.

Id. at 848. The plaintiffs did not appeal that order. Id. The order appealed in Levy was a final order

dismissing all of the plaintiffs’ claims except for the putative-class representatives’ individual claims

for injunctive relief to compel assignments from the Retailers of the Retailers’ refund claims against

the Comptroller and for damages beyond the amount of any tax refund. Id. The plaintiffs appealed

only the trial court’s dismissal of the class claim seeking to compel an assignment of the Retailers’

rights to file a refund claim with the Comptroller. Id. at 849.

                As part of our decision, we explained that section 111.104(b) of the tax code precludes

consumers from filing a refund claim with the Comptroller because they did not pay the tax

“directly” to the state, but that they could file a refund claim with the Comptroller after procuring

an assignment from the Retailers. Id. at 850 (construing section 111.104(b), which allows person

who “directly” paid tax to state, that person’s attorney, assignee, or other successor to file refund

claim); see also Tex. Tax Code Ann. § 111.104(b). We concluded that the district court had

jurisdiction to consider the plaintiffs’ claims against the Retailers to compel an assignment of

                                                   4
the Retailers’ refund rights and to consider whether a class should be certified. Levy, 228 S.W.3d

at 852. We did not opine on whether the tax code allows a class action for refund claims. See id.

at 851 (noting that neither tax code nor Comptroller’s regulations contain express language

allowing class actions for refund claims). Without opining on the merits of the plaintiffs’ claims for

assignments from the Retailers, we remanded the case to the district court for consideration of the

plaintiffs’ claims and motion to certify a class. Id. at 851 n.2, 852.

               After we issued our decision in Levy, the plaintiffs settled with the Retailers. As

explained above, the terms of the settlement agreements required the Retailers to assign their rights

to assert refund claims to the class members. The trial courts granted preliminary approval of the

proposed Retailer settlements and certified classes only for settlement purposes. All three orders

define the class similarly, as consisting of those persons or entities who were Texas residents that

redeemed mail-in rebates for a taxable purchase made during a certain date range at one of the

Retailers’ Texas stores (and for CompUSA and Best Buy, via Internet or telephone order and

shipped to a Texas address).

               Only the CompUSA settlement order contains any analysis of the class-certification

requirements of Texas Rule of Civil Procedure 42(a). The trial court found that the numerosity

requirement was satisfied because there were over 200,000 potential class members, that the

proposed class representatives’ claims were typical of the other potential class members’ claims,

and that proposed class counsel and the proposed class representatives would adequately represent

the class. See Tex. R. Civ. P. 42(a). The trial court also found that the commonality requirement

was met because all potential class members made purchases subject to sales tax and all mailed in



                                                  5
applications for retailer rebates. In addition, the trial court found that two questions of law were

common to all potential class members: (1) whether sales tax is ultimately due to the Comptroller

on amounts that retailers refund to customers via rebates and (2) if sales tax is not due on amounts

that retailers refund to customers via rebates, whether an injunction should be issued requiring the

Retailers to refund sales tax to customers who had redeemed Retailer rebates.5

                The CompUSA order also contains the only analysis of why the trial court found that

the class should be certified as a mandatory class as provided in Texas Rule of Civil Procedure

42(b)(2). The trial court found that the declaratory relief sought predominated over any monetary

relief, which was incidental to the declaratory judgment that sales tax is not due on retailer rebates

and the injunctive relief requiring assignments. See Tex. R. Civ. P. 42(b)(2) (allowing class action

to be maintained on ground that “the party opposing the class has acted or refused to act on grounds

generally applicable to the class, thereby making appropriate final injunctive relief or corresponding

declaratory relief with respect to the class as a whole”). All three orders noted that notice to the class

would not be required until settlement-class counsel sought final approval of the settlement and

disbursement of any recovery “on behalf of the Settlement Class” because the settlement class was

being conditionally certified for settlement purposes as a mandatory class under Rule 42(b)(2).

Compare Tex. R. Civ. P. 42(c)(2)(A) (allowing court to direct appropriate notice to class for class

certified under Rule 42(b)(1) or (2)) with Tex. R. Civ. P. 42(c)(2)(B) (requiring court to direct

notice and opt-out opportunity to class members at time of class certification for classes certified

under Rule 42(b)(3)).


        5
         The order stated that the common issue of whether sales tax is due on amounts refunded
to customers via retailer rebates had already been decided on summary judgment.

                                                    6
               As previously mentioned, when the trial courts granted preliminary approval of

the settlements, in addition to appointing Perlmutter & Schuelke, LLP as settlement-class counsel

in the class cases, they also granted the firm power of attorney to represent the settlement-class

members in the presentation of their individual claims to the Comptroller. The trial courts ordered

that Perlmutter & Schuelke was appointed:


       to represent the Settlement Class Members in the presentation of their individual
       claims for refunds to the Comptroller and to pursue any and all necessary
       administrative appeals and proceedings in all courts. Perlmutter & Schuelke, L.L.P.
       is hereby given full power of attorney to represent such Settlement Class Members
       in their individual claims against the Comptroller . . . .


The terms of the settlement agreements required settlement-class counsel to diligently seek full tax

refunds for all of the settlement-class members in proceedings before the Comptroller and any

subsequent available appeals. The settlement agreements also all contemplated that settlement-class

counsel would seek a percentage of the total refunds recovered from the Comptroller for attorney’s

fees and expenses when seeking final approval of the settlement at the conclusion of the

administrative process.


Administrative proceedings before the Comptroller

               Perlmutter & Schuelke filed three written claims with the Comptroller on behalf

of the individual settlement-class members, explaining that their “clients ha[d] been assigned the

single claim” of each of the Retailers for sales tax paid on purchases for which a cash discount was

offered through a retailer rebate. With each of the three claims, settlement-class counsel submitted

a spreadsheet containing each Assignee’s name, purchase date, and rebate amount, which had

                                                 7
been compiled from information provided to settlement-class counsel by the Retailers. They sought

refunds totaling $1,276,312.55 for the CompUSA Assignees; $11,054,086.76 for the Best Buy

Assignees; and $1,999,768.83 for the OfficeMax Assignees. Settlement-class counsel requested

that the checks for the bulk payments be made payable to the settlement classes for distribution after

final approval of the settlements by the trial courts.

                As mentioned earlier, the Comptroller’s staff denied the refund claim. The staff based

its denial primarily on the grounds that the settlement classes lacked standing to file the refund

claims for the individual class members. After a contested-case hearing, the ALJ recommended that

the refund denial be upheld. The Comptroller also denied the refund claims. When the Comptroller

issued her ruling, she made some changes to the proposal for decision to reflect her determination

that the ALJ improperly concluded that our ruling in Levy allowed class-action refunds.6 In each of

her decisions, the Comptroller found that the settlement class had filed a refund claim on behalf of

the members of the class. She concluded, however, that (1) the tax code does not authorize a class

to file a refund with the Comptroller, (2) the tax code does not give the Comptroller the statutory

authority to grant a class-action refund, (3) the settlement class was required to submit the supporting

documentation required by the Comptroller for verification of the refund claim, and (4) the statute

of limitations expired for claims arising from tax that was due and payable more than four years

before the refund claim was filed on April 16, 2008. Accordingly, she denied the refund claims.




        6
          As noted above, in Levy, we did not opine on whether the tax code allows a class action
for refund claims. Levy v. Office Max, 228 S.W.3d 846, 851 (Tex. App.—Austin 2007, no pet.). In
this appeal, the Assignees have conceded that “the Tax Code does not allow administrative class
refund claims,” so again we do not opine upon this issue.

                                                   8
                 The Assignees filed motions for rehearing, asserting that the Comptroller erred by

(1) denying them authority to file their refund claims, (2) failing to toll limitations for Assignees

whose claims arose within four years before the Assignees filed their original lawsuit against the

Retailers, and (3) rejecting Assignees’ documentation of their refund claims. The Comptroller denied

these motions.


This lawsuit

                 After the denial of the motions for rehearing, the settlement-class representatives,

along with the other Assignees, “including but not limited to those whose names appear on the

compact disks attached” to the petition, sued the Comptroller. The petition sought “aggregate refunds

for assignees of each of the retailers” in the following amounts: $1,604,367.17 for the CompUSA

Assignees; $11,017,104.44 for the Best Buy Assignees; and $1,999,730.71 for the Office Max

Assignees. The Assignees incorporated their motion for rehearing and its attached exhibits, their

claim submissions to the Comptroller, into their petition.

                 The Comptroller filed a plea to the jurisdiction, asserting that the Assignees had not

properly exhausted their administrative remedies because settlement-class counsel lacked authority

to file an individual refund on behalf of each individual putative-class member. See Tex. Gov’t Code

Ann. § 311.034 (West Supp. 2011) (establishing that statutory prerequisites to suit are jurisdictional

requirements in suits against governmental entities); see also Tex. Tax Code Ann. § 111.104(d)

(establishing that failure to file timely refund claim waives any demand against State for alleged

overpayment). The Comptroller contended that the trial courts in the Retailer Suits did not have

jurisdiction to appoint settlement-class counsel to be the individual counsel for hundreds of thousands

                                                   9
of absent class members for the purpose of initiating separate administrative proceedings against the

Comptroller, who was not a party to the orders preliminarily approving the class settlements. The

Comptroller collaterally attacked the trial courts’ appointment orders as void, contending that the

trial courts lacked jurisdiction to enter those particular orders (to enter orders appointing class

counsel to individually represent the settlement-class members in another lawsuit) and jurisdiction

of the subject matter (because there was no justiciable controversy between the Retailers and the

class concerning representation of the individuals in the administrative proceeding). See Austin Indep.

Sch. Dist. v. Sierra Club, 495 S.W.2d 878, 881-82 (Tex. 1973) (identifying four circumstances in

which court’s judgment is void and subject to collateral attack). The Comptroller also contended

that the appointment orders are void because they constitute fundamental error that directly and

adversely affects the public interest as declared in the statutes or constitution of Texas. See Wagner

v. D’Lorm, 315 S.W.3d 188, 192 (Tex. App.—Austin 2010, no pet.). The Comptroller argued that

in this case the appointment orders constitute fundamental error because they would circumvent the

procedural safeguards of Texas Rule of Civil Procedure 42, prevent her from implementing the

warrant-hold statutes, potentially harm absent class members, and violate the tax code. For all these

reasons, the Comptroller argued, the appointment orders are void and settlement-class counsel could

not be considered the individual Assignees’ “attorney” within the meaning of section 111.104 of the

tax code and could not exhaust administrative remedies on those individuals’ behalf. Consequently,

the Comptroller asserted, the Assignees have failed to comply with the statutory requirements to

waive sovereign immunity for tax-refund suits.

               The Assignees responded that the trial courts had jurisdiction to define the scope of

class counsel’s duties on behalf of the class and that the Retailers and the class were adverse until

                                                  10
the settlement was final, so the controversy was a justiciable one. The Assignees also argued that

the appointment orders did not constitute fundamental error because the trial courts appropriately

certified the classes for settlement purposes as Rule 42(b)(2) classes, which allowed the trial courts

to postpone notice to the class and the ability to opt out until the parties seek final approval of the

settlement. The Assignees further asserted that the ability to opt out at the time of final settlement

approval adequately protects the absent class members’ rights and that the Comptroller would be able

to implement the warrant-hold statutes because she had the class members’ names. They contended

that because this Court had determined in Levy that the trial courts had jurisdiction to consider the

Assignees’ claims against the Retailers to compel an assignment of refund rights and to consider

class certification, the appointment orders did not violate the tax code’s lack of authorization of a

class-action proceeding for refund claims. See Levy, 228 S.W.3d at 851-52. The Assignees also

contended that the appointment orders were merely voidable, not void, and thus, the Comptroller

should have given them effect throughout the administrative process.

               The trial court granted the Comptroller’s plea to the jurisdiction. The Assignees then

perfected this appeal.


                                    STANDARD OF REVIEW

               Sovereign immunity from suit defeats a trial court’s jurisdiction and therefore is

properly asserted in a plea to the jurisdiction. Texas Dep’t of Parks & Wildlife v. Miranda, 133

S.W.3d 217, 225-26 (Tex. 2004). Whether a court has subject-matter jurisdiction is a question of

law. Id. at 226.



                                                  11
                Some pleas to the jurisdiction may be determined solely from the pleadings. Id. In

other cases, such as this one, we must consider evidence challenging the existence of jurisdictional

facts to resolve the jurisdictional issues raised. See id. at 226-27. In these cases, the applicable

standard of appellate review depends on whether the jurisdictional facts implicate the merits of the

plaintiff’s case and whether the evidence is disputed. University of Tex. v. Poindexter, 306 S.W.3d

798, 806-08 (Tex. App.—Austin 2009, no pet.). When the jurisdictional issue does not implicate

the merits of the case and the jurisdictional facts are undisputed, the trial court should make the

jurisdictional determination as a matter of law based solely on the undisputed facts. Id. at 806.

                The Comptroller’s plea to the jurisdiction challenged the existence of the jurisdictional

facts alleged by the Assignees—specifically, whether the Assignees had exhausted their administrative

remedies through settlement-class counsel’s filing of their aggregated refund claims with the

Comptroller. The jurisdictional issue—whether the trial courts had jurisdiction to appoint settlement-

class counsel to represent the Assignees in their individual proceedings before the Comptroller—does

not implicate the merits of the Assignees’ case (i.e., whether they are owed tax refunds on the

rebated portions of their purchases). See id. at 807-08. In this case, the relevant jurisdictional facts

are undisputed. Thus, the trial court was required to resolve the jurisdictional issue on the basis of

those undisputed facts. Id. at 808. Accordingly, whether the Assignees exhausted their administrative

remedies is a question of law we review de novo. See id. at 807-08.


                                             DISCUSSION

                In her plea to the jurisdiction, the Comptroller collaterally attacked the trial courts’

orders as void. As a result, we must decide whether the trial courts in the Retailer Suits had jurisdiction

                                                    12
to enter the orders appointing settlement-class counsel to represent the class members in an

individual capacity in separate, non-class-action refund proceedings before the Comptroller. If they

did not, then those appointment orders are void, settlement-class counsel had no authority to file the

individual Assignees’ refund claims, the Assignees in effect never appeared before the Comptroller,

and the trial court in this case correctly granted the Comptroller’s plea to the jurisdiction.

                A collateral attack seeks to avoid the binding force of a judgment in a proceeding not

instituted for the purpose of correcting, modifying, or vacating that judgment. Browning v. Prostok,

165 S.W.3d 336, 346 (Tex. 2005). The collateral attack is brought by a party seeking some specific

relief that the judgment currently bars; in this case, the Comptroller seeks to avoid payment of

aggregated refunds to the Assignees based on the claims filed by settlement-class counsel. See id.

Because the collateral attack by definition is not a direct attack and can arise in a variety of contexts,

no set procedure exists for collaterally attacking a judgment.7 See Texas Dep’t of Transp. v. T. Brown


        7
          The Assignees contend that the Comptroller does not have standing to challenge the
appointment orders because she was not a party to the Retailer Suits when the courts issued
the orders. The Comptroller is not bringing a direct attack; she need not have been a party to the
Retailer Suits to bring a collateral attack. See Grynberg v. Christiansen, 727 S.W.2d 665, 666-67
(Tex. App.—Dallas 1987, no writ) (holding that judgment may be collaterally attacked by one who
was not party to but who has substantial interest in subject matter of judgment (citing Dean v. First
Nat’l Bank of Athens, 494 S.W.2d 222, 226 (Tex. Civ. App.—Tyler 1973, writ ref’d n.r.e.))). She
seeks to avoid the prior judgments’ effect in the administrative refund proceedings. The Assignees
also assert that the Comptroller does not have a justiciable interest in challenging the trial courts’
jurisdiction to appoint individual counsel. But as discussed below, the Comptroller has an interest
in defending her authority to deny a claim on the ground that the person who filed the claim does
not satisfy the statutory prerequisites for filing. Furthermore, this controversy will be resolved
by the relief she sought at the trial court and continues to seek here—a ruling that the trial
courts’ appointment orders are void. Thus, a justiciable controversy exists between the parties, and
the Comptroller has standing to collaterally attack the prior judgments in this lawsuit. See Todd,
53 S.W.3d at 305.
        The Assignees also argue that the Comptroller has no standing under the tax code to
challenge the appointment of counsel because the code does not authorize it. We disagree. The tax

                                                   13
Constructors, Inc., 947 S.W.2d 655, 659 (Tex. App.—Austin 1997, pet. denied). Only a void

judgment may be collaterally attacked. Browning, 165 S.W.3d at 346. The judgment of a court of

general jurisdiction is void only when it is apparent that the court had (1) no personal jurisdiction

over a party or his property, (2) no jurisdiction over the subject matter, (3) no jurisdiction to enter

the particular judgment, or (4) no capacity to act as a court. Sierra Club, 495 S.W.2d at 881-82. A

judgment is also subject to collateral attack for “fundamental error,” which occurs when “‘the record

shows the court lacked jurisdiction or the public interest is directly or adversely affected as that

interest is declared in the statutes or the Constitution of Texas.’” Wagner, 315 S.W.3d at 192 (quoting

Pirtle v. Gregory, 629 S.W.2d 919, 920 (Tex. 1982)).

                The Assignees assert in one issue that the trial court erred by sustaining the

Comptroller’s plea to the jurisdiction because the plea was an improper collateral attack on the

trial courts’ orders that established settlement-class counsel’s duties, including the pursuit of the

Assignees’ individual administrative claims. The Assignees make three arguments to support their

contention that the trial courts had jurisdiction to enter the appointment orders. First, they argue that

the trial courts (1) had jurisdiction over the subject matter because of our decision in Levy and (2)



code empowers the Comptroller to collect taxes and to adopt rules for the enforcement of the code
and the collection of taxes under the code. See Tex. Tax Code Ann. § 111.002 (West 2008). The
tax code also empowers the Comptroller to determine whether a tax refund is due when a claim is
filed. Id. § 111.104 (West 2008). It is within the Comptroller’s statutory authority to deny a claim
on the ground that the person who filed the claim with her office does not satisfy the statutory
definition of a person who may file a claim. See id. § 111.104(b). This exercise of the Comptroller’s
statutory authority and the Comptroller’s decision to collaterally attack the trial courts’ orders as
void as part of her exercise of that authority do not violate the separation-of-powers doctrine, as
Assignees further contend. The Comptroller’s challenge in this lawsuit of the trial courts’ orders
in another lawsuit in no way interferes with the judicial process. See General Servs. Comm’n v.
Little-Tex Insulation Co., 39 S.W.3d 591, 600 (Tex. 2001).

                                                   14
had jurisdiction to enter the particular orders because they have implied authority under Texas Rule

of Civil Procedure 42 to define the scope of class counsel’s duties to accomplish the purposes of

class actions. Second, the Assignees argue that there was no fundamental error in the appointment

orders. Third, they argue that the appointment orders resolved a justiciable controversy because the

putative classes were adverse to the Retailers until the settlements were approved.


Jurisdiction over the subject matter

               The Assignees contend that in the Levy decision this Court resolved the issue of

whether the trial courts had jurisdiction over the subject matter by concluding that those courts had

jurisdiction to consider the putative classes’ claims against the Retailers for assignment of refund

rights. See Levy, 228 S.W.3d at 851-52. The Comptroller agrees that this is the Court’s holding in

Levy. But the Comptroller asserts that the trial courts’ subject-matter jurisdiction to consider the

limited issue of a putative class’s claim for injunctive relief in the form of an assignment cannot be

extended to include jurisdiction to appoint individual counsel for hundreds of thousands of absent

potential claimants in separate and independent actions before the Comptroller for a tax refund. See

id. at 849 (noting that appellants did not appeal Comptroller’s dismissal from suit).

               Subject-matter jurisdiction refers to a court’s power to hear a particular type of suit.

See CSR Ltd. v. Link, 925 S.W.2d 591, 594 (Tex. 1996) (distinguishing between subject-matter

jurisdiction as court’s power to hear particular type of suit and personal jurisdiction as court’s

power to bind particular person or party); see also Perry v. Del Rio, 53 S.W.3d 818, 824 (Tex.

App.—Austin 2001) (“Subject-matter jurisdiction refers to the kinds of controversies a court has

authority to hear, as determined by the constitution, jurisdictional statutes, and the pleadings.”),

                                                 15
dism’d as moot, 66 S.W.3d 239 (Tex. 2001). It is clear from our previous decision in Levy that the

trial courts had the power to hear the Retailer Suits and consider the putative classes’ claims for

injunctive relief in the form of assignments. Thus, the central question here is whether the trial courts

had jurisdiction to enter the particular orders in those Retailer Suits appointing class counsel to act

as individual counsel for absent class members in separate administrative proceedings.8


Jurisdiction to enter the particular orders

                A challenge to a court’s jurisdiction to enter a particular order “strikes at the very

power of the court to render the judgment.” Sierra Club, 495 S.W.2d at 882. The Texas Constitution

vests the judicial power of this State “in one Supreme Court, in one Court of Criminal Appeals, in

Courts of Appeals, in District Courts, in County Courts, in Commissioners Courts, in Courts of

Justices of the Peace, and in such other courts as may be provided by law.” Tex. Const. art. 5, § 1.

Express grants of jurisdiction in the constitution and statutes apportion the judicial power among




        8
          We note that the parties have also raised the issue of whether the appointment orders
resolved a justiciable controversy between the putative classes and the Retailers. We recognize that
this issue also implicates the trial courts’ subject-matter jurisdiction because it is related to standing,
which is a necessary component of subject-matter jurisdiction. See Texas Workers’ Comp. Comm’n
v. Garcia, 893 S.W.2d 504, 517-18 (Tex. 1995). The standing doctrine identifies those suits that are
appropriately resolved through the judicial process. Brown v. Todd, 53 S.W.3d 297, 305 (Tex. 2001)
(citing Whitmore v. Arkansas, 495 U.S. 149, 154-55 (1990)). “Standing limits subject matter
jurisdiction to cases involving a distinct injury to the plaintiff and ‘a real controversy between the
parties, which . . . will be actually determined by the judicial declaration sought.’” Id. (quoting
Texas Workers’ Comp. Comm’n v. Garcia, 893 S.W.2d 504, 517-18 (Tex. 1995). We need not reach
the issue of whether the putative classes’ standing to seek assignments in the Retailer Suits translates
into standing for the putative classes to seek the appointment orders because we ultimately conclude
that the dispositive issue in this case is the trial courts’ lack of jurisdiction to enter the particular
orders. See Tex. R. Civ. P. 47.1 (court of appeals must hand down written opinion that is as brief
as practicable but that addresses every issue raised and necessary to final disposition of appeal).

                                                    16
these various courts. See Eichelberger v. Eichelberger, 582 S.W.2d 395, 398 (Tex. 1979). Thus,

a particular court’s jurisdiction is the portion of judicial power that it has been expressly authorized

to exercise by the constitution or statutes. Id.

                In addition to the express grants of judicial power to each court, courts also have

implied and inherent powers. Id. A court’s inherent judicial powers originate from the duties and

responsibilities that the constitution has created and delegated to the court—they are administrative

powers, not jurisdictional powers. Id. at 398-99 (explaining that inherent powers are those upon

which court may call “to aid in the exercise of its jurisdiction, in the administration of justice, and

in the preservation of its independence and integrity”); State Bar of Tex. v. Gomez, 891 S.W.2d 243,

245 (Tex. 1994) (explaining inherent powers are administrative, not jurisdictional). Implied powers

do not have an independent basis like inherent powers do. Instead, they are powers “which can and

ought to be implied from an express grant of power.” Eichelberger, 582 S.W.2d at 399-400 (holding

that supreme court’s express jurisdiction to resolve questions of law arising in cases decided by

intermediate appellate courts gave it implied jurisdiction to correct intermediate appellate court’s

decision that was contrary to decision of United States Supreme Court).

                Texas district courts are courts of general jurisdiction. Dubai Petrol. Co. v. Kazi,

12 S.W.3d 71, 76 (Tex. 2000). A district court’s jurisdiction “consists of exclusive, appellate, and

original jurisdiction of all actions, proceedings, and remedies, except in cases where exclusive,

appellate, and original jurisdiction may be conferred by this Constitution or other law on some other

court, tribunal, or administrative body.” Tex. Const. art. V, § 8; see also Tex. Gov’t Code Ann.

§ 24.007 (West Supp. 2011) (granting jurisdiction to district courts as provided in article V, section 8



                                                   17
of Texas Constitution). A district court may hear any case “that is cognizable by courts of law or

equity and may grant any relief that could be granted by either courts of law or equity.” Tex. Gov’t

Code Ann. § 24.008 (West 2004). Courts of general jurisdiction are presumed to have subject-matter

jurisdiction unless a showing can be made to the contrary. Dubai, 12 S.W.3d at 75. In this case, the

parties agree that the trial courts in the Retailer Suits had subject-matter jurisdiction over the putative

classes’ claims seeking to compel assignments of the Retailers’ rights to request sales-tax refunds,

see Levy, 228 S.W.3d at 852, but they disagree about the extent of the trial courts’ powers that can

be implied from the express authority granted to the courts by Rule 42 to administer class actions,

see Tex. R. Civ. P. 42.

                As a preliminary matter, we address the Assignees’ contention that the supreme

court’s decisions in Dubai and In re United Services Automobile Ass’n require us to conclude that

the trial courts had jurisdiction to enter the particular orders. See In re United Servs. Auto. Ass’n,

307 S.W.3d 299, 309 (Tex. 2010); Dubai, 12 S.W.3d at 76. The Assignees assert that the effect of

these decisions is that the Comptroller must show affirmative legislative intent to make the trial

courts’ power to determine the scope of class counsel’s duties under Rule 42 a jurisdictional matter.

But the holding of those cases is that a statutory prerequisite to suit is not jurisdictional unless

the statute’s language shows clear legislative intent to treat the restriction as jurisdictional. USAA,

307 S.W.3d at 306-07 (explaining difference between mandatory, but not jurisdictional, statutory

requirements and requirements that are both mandatory and jurisdictional); Dubai, 12 S.W.3d at

76-77 (distinguishing between statutory prerequisites that establish party’s right to go forward with

suit under wrongful-death statute for death in foreign state or country and trial court’s subject-matter



                                                    18
jurisdiction over wrongful-death claim). Contrary to the Assignees’ assertion, the supreme court

did not hold in Dubai and USAA that clear legislative intent to make an issue jurisdictional must be

shown before a party can challenge a trial court’s power to decide the issue. In addition, the question

here is not whether the Assignees failed to establish a prerequisite to suit in the Retailer Suits and

whether that failure should be considered jurisdictional; the question is whether Rule 42 allows trial

courts to grant settlement-class counsel the authority to represent individual absent class members

in their individual refund proceedings before the Comptroller. See Dubai, 12 S.W.3d at 76-77

(explaining that plaintiff’s right to maintain suit by satisfying statutory prerequisites relates to

plaintiff’s right to relief, not to court’s jurisdiction to provide requested relief). Consequently, we

need not determine whether the legislature affirmatively intended to make this issue jurisdictional.

Instead, we must determine the parameters of the relief that Rule 42 allows trial courts to provide.

                The Assignees contend that the trial courts had jurisdiction to enter the appointment

orders because they have implied authority under Texas Rule of Civil Procedure 42 to define the

scope of class counsel’s duties to accomplish the purposes of class actions. The Assignees focus on

the language of Rule 42 that gives trial courts the power to appoint class counsel to represent the

interests of the class and to make orders in connection with that appointment. In particular, the

Assignees base their argument that Rule 42 allows trial courts to define the duties of class counsel

on the rule’s provisions that (1) class counsel must fairly and adequately represent the interests of the

class and (2) a court certifying a class may make further orders in connection with its appointment

of class counsel. See Tex. R. Civ. P. 42(g)(1)(B), (g)(1)(C)(iv). They argue that from this language

we can imply that the trial courts have jurisdiction to define the scope of class counsel’s duties to



                                                   19
include representing hundreds of thousands of absent individual class members in individual refund

proceedings outside the original class actions. They also assert that the courts’ jurisdiction must

encompass this implicit judicial power to accomplish the judicial-economy purpose of class actions

by preventing a burdensome multiplicity of suits and the possibility of inconsistent results. Finally,

to further support their contention that we should imply judicial power to establish individual

attorney-client relationships between class counsel and the members of the settlement classes, they

rely on the fiduciary duties that all class counsel owe to their clients to establish that attorneys for

a class have an existing attorney-client relationship with each individual member of that class. We

will address each of these arguments in turn.


               Rule 42’s plain language limits the relief that trial courts may provide

               We begin by examining the language of Rule 42. When construing rules of civil

procedure, we apply the same rules of construction that we use when interpreting statutes. In re

Christus Spohn Hosp. Kleberg, 222 S.W.3d 434, 437 (Tex. 2007). Our primary objective is to give

effect to the drafter’s intent, which we discern from the plain and common meaning of the rule’s

words. See State v. Shumake, 199 S.W.3d 279, 284 (Tex. 2006) (addressing statutory construction).

If the rule’s language is unambiguous, we must interpret it according to its plain meaning, giving

meaning to the language consistent with other provisions in the rule. See TGS-NOPEC Geophysical

Co. v. Combs, 340 S.W.3d 432, 439, 441 (Tex. 2011) (addressing statutory construction). We typically

give undefined terms in a statute their ordinary meaning, but we will apply a different or more

precise definition, if one is apparent from the term’s use in context. Id. We will not give an

undefined term a meaning that is inconsistent or not in harmony with other provisions in the rule.

                                                  20
See McIntyre v. Ramirez, 109 S.W.3d 741, 745 (Tex. 2003). We presume that the legislature chooses

a statute’s language with care, purposefully choosing each word it includes, while purposefully

omitting words not chosen. TGS-NOPEC, 340 S.W.3d at 439. We may consider other factors in

ascertaining the intent behind a rule, including the rule’s objective and the consequences of a

particular construction. See Tex. Gov’t Code Ann. § 311.023(1), (5) (West 2005) (establishing

statutory-construction aids); see also Shumake, 199 S.W.3d at 284.

               Rule 42’s plain language establishes that “[a]n order certifying a class action must

define the class and the class claims, issues, or defenses, and must appoint class counsel under Rule

42(g).”9 Tex. R. Civ. P. 42(c)(1)(B) (emphasis added). Rule 42(g) reiterates that a court certifying

a class “must appoint class counsel” and further provides that “[a]n attorney appointed to serve

as class counsel must fairly and adequately represent the interests of the class.” Tex. R. Civ. P.

42(g)(1)(A) (emphasis added). The court certifying a class and “appointing class counsel . . . may

make further orders in connection with the appointment” of class counsel. Tex. R. Civ. P.

42(g)(1)(C)(iv) (emphasis added). Rule 42 governs only class actions—not individual proceedings.

Rule 42(g) governs only appointment of class counsel—not counsel for individual absent class

members.

               Under the rule, the appointment of class counsel only happens when a court enters

a certification order defining the class and the class claims, issues, or defenses. See Tex. R. Civ. P.


       9
          “Class” commonly means “[a] group of people . . . that have common characteristics or
attributes,” and as noted, Rule 42 further provides a mechanism by which the trial court must define
the class and its claims if the court determines that certification of a case as a class action is
appropriate. Black’s Law Dictionary 284 (9th ed. 2009). By way of contrast, the term “individual”
is commonly understood to mean “[o]f or relating to a single person or thing, as opposed to a group.”
Id. at 843.

                                                  21
42(c)(1)(B). In other words, when the court appoints class counsel, it appoints class counsel to serve

the interests of the class, as that class and its claims, issues, or defenses are defined in the

certification order. Thus, when read as a whole, the language of the rule expressly limits the class’s

interests to the interests defined in the certification order.

                In this case, the trial courts certified settlement classes consisting of people who were

Texas residents at the time they redeemed mail-in retailer rebates for taxable purchases from the

Retailers during certain defined time periods. The only settlement order that defined the class claims

identified the only unresolved common issue of law as the question of “whether an injunction should

be issued requiring Retailers to refund sales tax to customers who have redeemed Retailer rebates”

and found that the putative class also sought an injunction to require the Retailer to provide

assignments to the class members so that the “members may seek refunds directly from the

Comptroller.” In addition, as noted earlier, the only class claim remaining in the Retailer Suits after

this Court’s opinion in Levy was the claim seeking to compel the Retailers to assign their rights to

request refunds from the Comptroller. Levy, 228 S.W.3d at 852. And all the settlement agreements

approved by the courts provided that the Retailers would execute assignments and deliver them to

settlement-class counsel. All the orders note that the settlement classes were being conditionally

certified for settlement purposes as Rule 42(b)(2) mandatory classes. As one trial court explained

in its order, this meant that notice need not be given to the class members at the time of preliminary

approval of the settlements because the primary relief sought in the lawsuit and provided in the

settlement was injunctive, non-monetary relief.

                The limited injunctive relief sought by the class here is the primary distinction

between this case and the cases cited by the Assignees for the proposition that it is within the

                                                   22
courts’ power to appoint counsel to represent class members in separate proceedings when that

representation is in the best interest of the class. In all of those cases, the class claims were claims

for monetary relief, not injunctive relief, meaning that class members received notice and an

opportunity to opt out at the time of class certification.10 In addition, all of those cases involved

extraordinarily complex class claims and equally complex settlements.11 Moreover, none of those

cases involved pursuit of a different type of relief against a defendant who was not already a party

to the class action. In Allapattah Services, Inc. v. Exxon Corp., class counsel continued to represent

the class members in a special claims process arranged by the court as part of the same case; the trial

court linked the potential award of attorneys’ fees to the success of the claims-administration

process. 454 F. Supp. 2d 1185, 1189 (S.D. Fla. 2006) (explaining that trial court required completion

       10
            See Allapattah Servs., Inc. v. Exxon Corp., 454 F. Supp. 2d 1185, 1191 (S.D. Fla. 2006)
(noting Exxon paid $1.075 billion into settlement fund); LaSala v. E*Trade Secs., LLC, No. 05 Civ.
5869(SAS), 2005 WL 2848853, at *1 (S.D.N.Y. Oct. 31, 2005) (explaining case arose from pending
partial settlement between plaintiff investor class and issuer defendants in hundreds of coordinated
securities actions known as In re Initial Public Offering Securities Litigation seeking recovery for
securities fraud); In re Austrian & German Bank Holocaust Litig., 317 F.3d 91, 92 (2d Cir. 2003)
(explaining appeal arose from creation of multi-billion dollar fund created to compensate Holocaust
victims for conversion of assets); In re Austrian & German Bank Holocaust Litig., 80 F. Supp. 2d
164, 167, 169 (S.D.N.Y. 2000) (explaining class representatives sought approval of proposed partial
settlement creating multi-million dollar fund); see also Fed. R. Civ. P. 23(c)(2)(B) (requiring notice
and opt-out option for Rule 23(b)(3) class at time of certification).
       11
           See Allapattah Servs., 454 F. Supp. 2d at 1189 (noting complexity of class action resulting
in two trials, extensive appeals, hotly contested claims administration process, and settlement
providing 92% of class members with full compensatory damages); LaSala, 2005 WL 2848853, at
*1 (partial settlement of IPO litigation cases, which included assignment of issuer defendants’ claims
against underwriter defendants to plaintiffs); In re Austrian & German Bank Holocaust Litig., 317
F.3d at 93-96 (discussing settlement of consolidated cases against various Austrian and German
banks involving assignment of Austrian banks’ claims against German banks and subsequent
complications and possible conflict of interest arising from proposed dismissal of case against
German banks); In re Austrian & German Bank Holocaust Litig., 80 F. Supp. 2d at 170 (explaining
claims process to be supervised by claims committee appointed by court).

                                                  23
of claims process before payment of attorneys’ fees to align interest of class counsel with potential

class members instead of leaving burden of finding class members to third-party claims administrator).

In the rest of the cases, the assigned claims were assigned to the class for pursuit by the class, not

its individual members, and the assigned claims were claims against non-settling defendants assigned

to the class by the settling defendants. See LaSala v. E*Trade Secs., LLC, No. 05 Civ. 5869(SAS),

2005 WL 2848853, at *1 (S.D.N.Y. Oct. 31, 2005) (explaining that assigned claims would ultimately

be pursued by Litigation Trustee on behalf of class if settlement was approved); In re Austrian &

German Bank Holocaust Litig., 317 F.3d 91, 93 (2d Cir. 2003) (discussing settlement involving

assignment of claims to class, not individual class members); In re Austrian & German Bank

Holocaust Litig., 80 F. Supp. 2d 164, 171 (S.D.N.Y. 2000) (explaining Austrian banks’ claims

against other banks were assigned to class as part of class settlement). These cases do not support

the Assignees’ contention that Rule 42 impliedly empowers trial courts to establish an individual

attorney-client relationship between class counsel and absent class members to allow class counsel

to pursue individuals’ claims in separate, non-class proceedings.

                We cannot conclude from Rule 42’s express grant of power to appoint class counsel

that the trial courts had the implied authority to appoint class counsel to act as individual counsel to

individual class members in separate actions outside the class actions suing a different defendant and

seeking a different type of relief. The plain language of Rule 42 limits the relief that the trial courts

could provide to the settlement classes to the confines of their class claim for assignments. “When

a statute clearly limits the relief which may be given in a particular situation, a judgment which

attempts to give relief other than that authorized is void. . . . [And] [t]he effect of the Texas Rules



                                                   24
of Civil Procedure is similar.”12 Gus M. Hodges, Collateral Attacks on Judgments, 41 Tex. L. Rev.

499, 515-17 (1963) (collecting cases). Accordingly, we conclude that the plain language of Rule 42

does not support an implied power to enter the appointment orders.


               The power Assignees seek to imply does not further Rule 42’s purpose

               We are not persuaded by the Assignees’ argument that the trial court’s express power

to administer class actions gives it the implied power to appoint class counsel to act as individual

counsel as a means of furthering the judicial-economy purpose of class actions. First, if settlement-

class counsel truly represents the hundreds of thousands of individuals on an individual (not

class) basis, it is unclear how this process avoids the possibility of an “inefficient and burdensome

multiplicity of suits” or serves judicial economy. Moreover, the Assignees’ argument highlights

the inherent contradiction in their position. They concede that “the Tax Code does not allow

administrative class refund claims.” But at the same time, they are requesting that the Comptroller

write three checks that aggregate the refund amounts owed to the Assignees for later distribution to

these individuals—a process that conspicuously mimics class-action procedure, particularly in light

of the provisions in the settlement agreements providing that class counsel will seek court approval

to have attorney’s fees deducted from the total amounts obtained from the Comptroller. In addition,

their rationale for the trial courts’ purported jurisdiction to appoint settlement-class counsel as

individual counsel to the Assignees depends on asserted benefits to the classes, but the classes are


       12
          For example, an order requiring a party to produce documents in discovery that could not
be the subject of discovery under the applicable civil-procedure rule is void. Gus M. Hodges,
Collateral Attacks on Judgments, 41 Tex. L. Rev. 499, 517 (1963) (analyzing cases in which various
civil-procedure rules limited available relief).

                                                 25
settlement-only classes that were approved for the sole limited purpose of obtaining assignments of

the refund claims from the Retailers for the class members. The assignments are the only thing that

the class members need to file their own claims with the Comptroller. Their ability to pursue their

individual refunds is not enhanced by appointment of an attorney (without their knowledge or

consent) to represent their individual interest before the Comptroller.

                Judicial economy is not the only objective of class action; “[o]ne of the foremost

objectives of Rule 42 is to protect the interests of absent class members.” General Motors Corp. v.

Bloyed, 916 S.W. 949, 953 (Tex. 1996) (noting that “class actions are extraordinary proceedings with

extraordinary potential for abuse”). Whatever the putative classes’ original or ultimate goal may

have been, the only claim resolved by the preliminary settlement approval orders was the claim for

assignments from the Retailers. We will not imply judicial power to appoint class counsel to act as

individual counsel in individual proceedings to extend the reach of a limited-purpose class action

beyond the certified class claims, especially when the parties agree that the tax code does not allow

class actions for sales-tax refund claims.


                Counsel’s fiduciary duties to the class do not support an implied power to appoint
                counsel to represent individual class members in other individual proceedings

                Nor are we persuaded that the existence of an attorney-client relationship between

class counsel and absent class members gives rise to an implied power for trial courts to establish

individual attorney-client relationships between class counsel and the absent individuals. The existence

of fiduciary duties alone does not mean that the same type of relationship exists between class

counsel and their class clients as exists between attorneys and individuals in non-class actions.

                                                  26
There are important differences between the two, not least of which is the differing responsibility

for client communications. Rule 42 governs class counsel’s communications with absent class

members in a class action, which often does not occur until near the conclusion of the case. See Tex.

R. Civ. P. 42(c)(2)(A) (governing notice to class certified under Rule 42(b)(1) or (2)); Tex. R. Civ.

P. 42(e)(1)(B) (governing notice of material terms of proposed settlement). Communications with

individual clients, on the other hand, are governed solely by Texas Disciplinary Rule of Professional

Conduct Rule 1.03. Rule 1.03 requires an attorney to “keep a client reasonably informed about the

status of a matter and promptly comply with requests for information.” Tex. Disciplinary Rules

Prof’l Conduct R. 1.03(a). It also requires an attorney to “explain a matter to the extent reasonably

necessary to permit the client to make informed decisions regarding the representation.” Tex.

Disciplinary Rules Prof’l Conduct R. 1.03(b). Given these differences, we decline to imply that the

trial courts have power to appoint class counsel to represent individual class members by filing

individual claims for them seeking a different type of relief when the individuals have been provided

no notice of their attorney-client relationship and no opportunity to make informed decisions about

their representation. We conclude that the jurisdiction to enter the particular orders at issue may not

be implied from Rule 42 because the rule’s express language contemplates only class representation,

and neither the judicial-economy purpose of class actions nor the fiduciary duties owed by class

counsel to the class support an implication of any additional power.

               We hold that the trial courts in the Retailer Suits lacked jurisdiction to appoint

settlement-class counsel to represent the individual Assignees in the presentation of their individual




                                                  27
refund claims to the Comptroller.13 Thus, those portions of the settlement orders purporting to appoint

settlement-class counsel as counsel for the individuals are void. As a result, the Assignees did not

properly exhaust their administrative remedies because settlement-class counsel lacked authority to

file individual refund claims on their behalf. The lack of exhaustion of administrative remedies means

that the Assignees have not satisfied the statutory requirements for waiving sovereign immunity in

a tax-refund suit. We overrule the Assignees’ issue on appeal.


                                          CONCLUSION

               Having determined that the trial court did not err by granting the Comptroller’s plea

to the jurisdiction, we affirm the judgment.



                                               __________________________________________

                                               David Puryear, Justice

Before Justices Puryear, Pemberton and Rose

Affirmed

Filed: July 20, 2012




       13
          Because we have concluded that the trial courts had no jurisdiction to enter the
appointment orders and thus the orders are void, we need not reach the Assignees’ remaining
argument that the orders did not constitute fundamental error. See Tex. R. Civ. P. 47.1 (court of
appeals must hand down written opinion that is as brief as practicable but that addresses every issue
raised and necessary to final disposition of appeal).

                                                  28
