The Statutory Basis for Declaratory Judgment Actions in Texas Lawsuits

State: Uniform Declaratory Judgment Act, Tex. Civ. Prac. & Rem. Code Ch. 37

37.004 provides:

(A) A person interested under a deed, will, written contract, or other writings constituting a contract or whose rights, status, or other legal relations are affected by statute, municipal ordinance, contract, or franchise may have determined any question of construction or validity arising under the instrument, statute, ordinance, contract or franchise and obtain a declaration of rights, status, or other legal relations there under.

(B) A contract may be construed either before or after there has been a breach.

37.002 provides that the chapter is remedial: “It’s purpose is to settle and to afford relief from uncertainty and in security with respect to rights, status, and other legal relations; and it is to be legally construed and administered.” The Act does not create or enlarge jurisdiction. E.g., Chenault v. Phillips, 914 S.W.2d 140, 141 (Tex. 1996). Pursuant to §37.003, a declaration may be either affirmative or negative in form and effect. Thus, an insured can seek an affirmative finding of coverage, or an insurer can seek a negative determination that coverage does not exist. However, each party must still plead for relief and carry its own burden of proof. See, e.g., City of Galveston v. Giles, 902 S.W.2d 167 (Tex. App.–Houston [1st Dist.] 1995, no writ); Employers Cas. Co. v. Tilley, 484 S.W.2d 802, 806 (Tex. Civ. App.–Beaumont 1972), aff’d other grounds, 496 S.W.2d 552 (Tex. 1973) (court had no authority to order declaration against insurer in response to insured’s motion for summary judgment on insurer’s claims); Indigo Oil, Inc. v. Wiser Oil Co., 1998 TEX. APP. LEXIS 7550 (Tex. App.–Dallas 1998, pet. denied) (failure to satisfy burden is not finding of proof of opposite).
37.008 provides that the court may refuse to render a declaratory judgment if the judgment would not terminate the uncertainty or controversy giving rise to the proceeding.

Federal: Declaratory Judgment Act, 28 U.S.C. §§2201-2202

2201. Creation of remedy

(a) In a case of actual controversy within its jurisdiction, except with respect to Federal taxes . . . any court of the United States, upon the filing of an appropriate pleading, may declare the rights and other legal relations of any interested party seeking such declaration, whether or not further relief is or could be sought. Any such declaration shall have the force and effect of a final judgment or decree and shall be reviewable as such.

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2202. Further relief

Further necessary or proper relief based on a declaratory judgment or decree may be granted, after reasonable notice and hearing, against any adverse party whose rights have been determined by such judgment.

Williams, McClure & Parmelee is dedicated to high quality legal representation of businesses and insurance companies in a variety of matters. We are experienced Texas civil litigation attorneys based in Fort Worth who know Texas courts and Texas law. For more information, please contact the law firm at 817-335-8800. The firm’s new office location is 5601 Bridge Street, Suite 300, Fort Worth, Texas 76112.

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