Cockrell Investment Partners owns a pecan orchard in Pecos County irrigated by wells that pump from the Edwards-Trinity Aquifer, and its neighbor Fort Stockton Holdings, L.P. (FSH) irrigated alfalfa and other crops from the same aquifer and later began selling water to Midland, Abilene, and San Angelo.¹ To pump from the aquifer a landowner needs a groundwater-production permit from the Middle Pecos Groundwater Conservation District, each of which caps annual production, and FSH sought permits to export more water, including a 2009 application to pump an additional 47,000 acre-feet a year in which Cockrell did not seek party status.² After the District denied that application and FSH leased its rights to Republic Water Company of Texas, which applied for a permit to pump 28,400 acre-feet and in which Cockrell did obtain party status, the parties settled, and in 2017 FSH asked the District to amend the 2009 application, a proceeding the settlement treated as a continuation of the 2009 one.³ The District denied Cockrell party status in the 2017 proceeding because the deadline had passed seven years earlier and approved FSH's applications, and when FSH sought to renew its permit in 2020, Cockrell again sought party status and the District neither granted nor denied the request and approved the renewal.⁴

Each permit application led to a new lawsuit, and Cockrell brought two claims under Section 36.251 of the Water Code challenging the denials of party status.¹ In the first, Cockrell filed a request for reconsideration and, believing it was overruled by operation of law after 45 days under Rule 4.9 of the District's local rules, sued after 74 days; the district court granted the pleas to the jurisdiction, and the court of appeals affirmed, holding the request was governed by Water Code Section 36.412's 90-day rehearing period.² In the second, the district court denied the pleas but granted summary judgment, and the court of appeals again affirmed on the same exhaustion ground because Cockrell waited only 67 days.³ The vehicle in this Court is two petitions for review filed by Cockrell, consolidated and argued on November 4, 2025, and decided on March 13, 2026.⁴

Consolidated petitions for review (Nos. 23-0593 and 23-0742) from the Eighth Court of Appeals (El Paso) after a plea to the jurisdiction in one case and a summary judgment in the other; argued November 4, 2025, and decided March 13, 2026.⁵

Cockrell's issues include whether it was bound by the conflicting exhaustion deadlines in Water Code Sections 36.412-.413, which apply to a permit "applicant or a party to a contested case hearing," or by the District's local Rule 4.9, which it followed because it was neither an applicant nor a party and was not seeking review of a permit decision.¹ The District and FSH argue that Cockrell's claims fail for want of jurisdiction, including because Cockrell chose not to participate in the contested case hearing and failed to exhaust administrative remedies.²

The Court's analysis turned on whether Section 36.251 of the Water Code waives the District's governmental immunity from this suit, which Cockrell must prove by satisfying all of the statute's requirements, construing putative waivers in favor of retaining immunity.¹

Whether Cockrell exhausted its administrative remedies before suing.

Cockrell (Petitioner): Because it was neither a permit applicant nor a party to a contested case hearing and was challenging the denial of party status rather than a permit decision, the Water Code's rehearing provisions with a 90-day period did not apply, and it properly followed Rule 4.9's 45-day reconsideration period.¹

District and FSH (Respondents): Cockrell knew for years of FSH's 2009 application and chose not to seek party status in time, so the District correctly denied its late requests, and the court of appeals correctly held Cockrell failed to exhaust remedies by suing before the 90-day period under Section 36.412 elapsed.²

Cockrell argued that the cases raise important questions about whether a petitioner before a groundwater district may rely on the district's local rules on exhaustion of administrative remedies, which matter to stakeholders across Texas who depend on the orderly application of the water-permitting law.¹

• The City of Midland filed an amicus brief.

Holding

Cockrell, which was neither a permit applicant nor a party to the administrative proceedings and challenged only the denial of party status, satisfied all three requirements of Water Code Section 36.251's waiver of immunity: the exhaustion requirements of Sections 36.412 and 36.413 apply only to an applicant or party, so Cockrell was not required to wait 90 days, and under Rule 4.9 it properly waited out the 45-day period before suing.¹

Reasoning

The waiver's three requirements. Section 36.251 waives the District's immunity for a person affected by and dissatisfied with a rule or order, and Cockrell is a "person" dissatisfied with the denial of party status; the limit that only the district, the applicant, and parties to a contested case may participate in an appeal of a decision on an application does not bar Cockrell, because it challenges the denial of party status, not the permitting decision.² The third requirement, that all administrative appeals to the district be final, turns on exhaustion of administrative remedies.³

Sections 36.412 and 36.413 do not apply to Cockrell. Those sections apply only to appeals of a decision "on a permit" by an applicant or a party, and Cockrell is not challenging the permit and was not a party, because an agency's failure to admit someone as a party means that person is not a party, as the U.S. Supreme Court recently held under the Hobbs Act.⁴ Section 36.402 does not enlarge the persons or decisions to which they apply, and the Legislature let districts adopt their own notice and hearing procedures.⁵

Rule 4.9 governs. Rule 4.9 does not limit reconsideration to a particular class of persons, so it allowed Cockrell to seek reconsideration of the denial of party status; the District implicitly denied the party-status requests when it granted FSH's permits, and because the District did not act within 45 days, the requests were denied by operation of law on September 11, 2017, and August 20, 2020, before Cockrell sued.⁶

Remand. The Court did not decide the other jurisdictional arguments the District and FSH raised, because the court of appeals had not addressed them and the Court is one of review, not first view.⁷

Disposition

Court of appeals' judgments reversed in both cases and the cases remanded to that court to address the remaining jurisdictional arguments and, if it has jurisdiction, the merits of Cockrell's appeals.⁸

Vote Breakdown

Justice Sullivan delivered the opinion of the Court, with no separate writings.⁹