Tenant of property on city’s water reservoir brought action against city for breach of leases after city terminated leases and evicted tenant.
The Second Judicial District Court granted city’s motion for summary judgment. Tenant appealed. The Court of Appeals affirmed. On review, the Supreme Court reversed and remanded. The Court of Appeals affirmed. Tenant petitioned for review.
The Supreme Court of Texas held that:
- City’s decision to lease its lakefront property to tenant was discretionary;
- City was acting primarily for the benefit of its own residents when it leased lake lots to private tenant;
- City was acting on its own behalf, and not that of the state, when it leased lake lots to private tenant;
- City’s leasing of lakefront property was not essential to city’s operation or maintenance of lake, and thus, was not governmental; and
- Governmental immunity did not operate to protect city from tenant’s suit for breach of the lease agreements.