When the Law Disagrees With Itself
With the 88th Legislative Session quickly coming to a close later this month, all eyes are on those proposed bills that would alter the municipal landscape. But, with legislative changes also come legislative amendments, and those amendments may sometimes significantly clash with long-standing law that – itself – wasn’t altered.
For example, under the Development Corporation Act, Chapter 501, Local Government Code, like governmental bodies, both Type A and Type B economic development corporations are required to act in accordance with the Texas Open Meetings Act, Chapter 551, Government Code. Unlike their counterparts though, Chapter 501 provides that these economic development corporations may – under certain circumstances – take action without posting notice and holding a public meeting.
Section 501.071 specifically provides that, “an action that can be taken at a meeting of a board of directors, including an action required by this subtitle to be taken at a meeting, may be taken without a meeting if each director signs a written consent providing the action to be taken.”
This caveat is a carry-over from Section 14(c) of the Development Corporation Act of 1979, prior to its codification in 2009 as the Development Corporation Act, which was untouched in the Legislature’s review in 2005 and exactly mirrors that language now found in Chapter 501.
If each director gives this written consent, it has the same effect as a unanimous vote. Documents required to be filed with the Secretary of State under the Development Corporation Act, including corporation documents and amendments to corporation documents, may even state as much.
But, everything isn’t always what it seems.
While Section 501.071 provides certain statutory authority, Section 501.072 directly contradicts Section 501.071 and states that, “a board of directors is subject to the open meetings law, Chapter 551, Government Code.”
The Office of the Attorney General has interceded to provide guidance and clarification based on Texas common law. In Attorney General Option No. JM-120, published in 1983, the Attorney General – relying on case law out of the Dallas and Tyler areas – states that “an act which is later in point of time controls or superseded an earlier act, insofar as the two are inconsistent and irreconcilable and cannot both stand at the same time.” The opinion goes on to say that “if statues have conflicting provisions, the earlier statute will be held to be repealed only to the extent of the conflict and otherwise will be construed as remaining in effect.”
So, while Sections 501.071 and 501.072 both remain in Chapter 501 as it reads today, Section 501.072 is the statute that will be given effect over Section 501.071. Section 501.071 has been effectively repealed, but Chapter 501 has not been amended to remove the conflicting statute.
The Development Corporation Act wouldn’t reveal this to a reader. Instead, as is the case for most conflicts of this type, Texas Legislative History needed to be reviewed and historical amendments analyzed. When deciding between two conflicting statutory authorities, be sure to consult the records of the Texas Legislature as well as legal counsel.
Please do not rely on this article as legal advice. We can tell you what the law is, but until we know the facts of your given situation, we cannot provide legal guidance. This website is for informational purposes and not for the purposes of providing legal advice.