CIVIL PROCEDURE

FALL 2009

In re Office of the Attorney General of Texas, 264 S.W.3d 800 (Tex. App.—Houston [1st Dist.] 2008, orig. proceeding)

Conclusion of Law Mislabeled as Finding of Fact May Be Considered as a Conclusion: The court of appeals reiterated that a conclusion of law that was mislabeled as a finding of fact may be reviewed on appeal for what it is, citing Ray v. Farmers State Bank of Hart, 576 S.W.2d 607, 608 n.1 (Tex. 1979).

Adams v. YMCA of San Antonio, 265 S.W.3d 915 (Tex. 2008)

Legally Sufficient Evidence Supports Jury Finding of Future Mental Anguish: The Supreme Court applied a traditional non-evidence standard to a jury finding that a male child who was 9 years old when sexually assaulted at a summer camp would suffer compensable mental anguish in the future, further explained the standard of review, reviewed the evidence, and concluded that legally sufficient evidence supported the finding.

Reynolds v. Murphy, 266 S.W.3d 141 (Tex. App.—Fort Worth 2008, pet. denied)

Unless Previous Remand Is Limited, Plaintiff Can Amend to Add New Claims and Can Engage in Discovery: In a prior appeal in this case, the court of appeals affirmed summary judgment against the plaintiff as to negligence and Deceptive Trade Practices Act violations, but remanded the cause as to the plaintiff’s fraud claim, because the defendant had not moved for summary judgment on that claim. Thereafter, the plaintiff attempted to amend to add new causes of action for breach of fiduciary duty and violations of Texas securities laws and the Business and Commerce Code, and the plaintiff attempted to conduct discovery as to those claims. The trial court sustained the defendant’s motions striking the new claims and barring discovery, holding that the remand by the court of appeals was limited to a determination of the fraud claim. Held: Reversed and remanded to the trial court. The court of appeals acknowledged that “when an appellate court remands a case and limits a subsequent trial to a particular issue, the trial court is restricted to a determination of that particular issue.” Here, however, the previous remand was not a limited one. Although the court remanded the cause as to a single claim, that was because it had been the sole remaining claim at the time. But neither the court’s previous mandate nor its opinion had suggested that the remand was limited to only a determination of the then remaining sole claim. Accordingly, the case as remanded was subject to the general rule: “When a case has been remanded, the cause is pending and amended pleadings may be filed in pending cases pursuant to [Texas Rule of Civil Procedure] 63.”

Reliance Steel & Aluminum Company v. Sevcik, 267 S.W.3d 867 (Tex. 2008)

Harmless Error Analysis for Improperly Admitted Evidence: The Supreme Court held that the trial court improperly allowed the plaintiff to adduce evidence of the defendant’s net worth, notwithstanding that the plaintiff was not seeking punitive damages and that the evidence was otherwise irrelevant. The court then conducted a harmless error analysis, considering several factors pertaining to whether erroneously admitted evidence was harmful: The effect on the verdict and judgment, the importance of the role the evidence played in the context of the trial, the extent of efforts by counsel to emphasize the erroneous evidence, and whether admission of the improper evidence was calculated or inadvertent. All of these factors, the court concluded, supported a determination that admission of the evidence was harmful.

Martinez-Partido v. Methodist Specialty and Transplant Hospital, 267 S.W.3d 881 (Tex. 2008)

Party Seeking Affirmance Need Not Explicitly Ask for Lesser Relief of Remand: The Supreme Court reiterated that a party seeking affirmance in the court of appeals need not explicitly raise the lesser relief of remand in order to request that relief if the court of appeals concluded that reversal was warranted. “A party seeking affirmance need not request the lesser included relief of remand. See Tex. R. App. P. 25.1(c).”

Coastal Oil & Gas Corp. v. Garza Energy Trust, 268 S.W.3d 1 (Tex. 2008)

No Waiver of Objection to Evidence by Explaining or Rebutting That Evidence: Coastal objected to evidence tendered by the plaintiffs on the grounds that the evidence was not relevant and was very prejudicial, but the trial court admitted the evidence. One of Coastal’s attorneys responded to the evidence in closing argument. The plaintiffs argued to the Supreme Court that Coastal waived its objection by addressing the evidence in summation, but the Supreme Court disagreed. “[W]e have held that a party is entitled to explain or rebut evidence admitted over objection and is not required ‘to sit idly by and take its chances on appeal,’” citing Scurlock Oil Company v. Smithwick, 724 S.W.2d 1, 4 (Tex. 1986).

No Abuse of Discretion in Refusing to Abate for Earlier Filed Action When Earlier Action Not Identical: Coastal contended that the trial court should have abated this suit due to an earlier filed action, but the Supreme Court disagreed. Most but not all of the plaintiffs in both cases were the same, and some of the defendants, including Coastal, were the same. The principal issue in the earlier suit had nothing to do with the issues in this case. A later filed suit must be abated when there was a complete identity of parties and controversies in both suits. Otherwise, abatement due to the pendency of a prior suit was based on the principles of comity, convenience, and the necessity for an orderly procedure in the trial of contested issues, which were matters committed to the sound discretion of the trial court. Here, the trial court did not abuse its discretion in refusing to abate.

Davis v. Fisk Electric Company, 2678 S.W.3d 508 (Tex. 2008)

Batson Challenge to Striking of African-American Jurors Upheld: Davis, an African-American, sued the defendant, contending that he was terminated from employment based on his race. The defendant used its six preemptory challenges to strike five of six African-American venire members and one other person who was also a minority. The trial court denied Davis’ Batson challenge to the defendant’s jury strikes. The Supreme Court rejected the defendant’s race-neutral explanations for some of the preemptory challenges, reversed the lower court’s judgment, and remanded the case for a new trial. The Supreme Court extensively discussed recent years’ developments in the area of preemptory challenges that were allegedly race-based.

DiGiuseppe v. Lawler, 269 S.W.3d 588 (Tex. 2008)

Pleading Is Not Proof: “A fact cannot be proved by a controverted pleading. The pleading simply puts the matter at issue.” Specifically, the majority of a closely divided Supreme Court held that, to be entitled to specific performance of a real estate purchase contract, a party must do more than plead his readiness, willingness, and ability to perform at relevant times; evidence and a favorable fact finding were necessary prerequisites for that relief.

In re Zandi, 270 S.W.3d 76 (Tex. 2008, orig. proceeding)

Due Process Requires Advance and Specific Notice of Alleged Contempt and Opportunity to Defend Against or Explain Charges: The former husband was held in contempt of child support order and assessed jail time, but the court suspended commitment on several conditions, including substantial payments and appearance in court every six months for status hearings. Before the first status hearing, the husband moved to modify the contempt order on the ground that his financial situation had worsened. The former wife conceded at the hearing that the husband had made substantial payments on arrearages, but asserted that he had failed to make recently due payments in the amount of $700. The husband objected that the wife had not filed a written motion to revoke suspension, but the court nonetheless revoked suspension of the husband’s commitment. The Supreme Court granted the husband’s petition for writ of habeas corpus. The Supreme Court held that the husband was entitled to written notice of specific allegations of contempt in advance of a hearing at which he would have the opportunity to meet the charges by way of defense or explanation, pursuant to constitutional due process requirements.

In re Butler, 270 S.W.3d 757 (Tex. App.—Dallas 2008, orig. proceeding)

Petition for Writ of Mandamus and Record Submitted With Petition Not Properly Authenticated: Relators contended in a petition for writ of mandamus that the trial court abused its discretion by denying their motion to disqualify opposing counsel. The court of appeals concluded that the petition and the mandamus record were not authenticated as required by the Texas Rules of Appellate Procedure. Rule 52.3(j) stated: “The person filing the petition must certify that he or she has reviewed the petition and concluded that every factual statement in the petition is supported by competent evidence included in the appendix or record.” This rule became effective September 1, 2008, replacing a prior version that required that factual statements contained in a petition be verified by affidavit made on personal knowledge by an affiant competent to testify to the matters stated. In contrast to the current requirement, relators’ attorney states: “I have reviewed the foregoing Petition for Writ of Mandamus and the factual statements contained therein are to my knowledge true and correct.” The court found that this statement failed to comply with the rule. In addition, Rule 52.3(k) stated that the appendix to the petition must contain “a certified or sworn copy of any order complained of, or any other document showing the matter complained of.” In the affidavit attached to the petition here, relators’ attorney stated: “The documents contained in the attached Record and attached Appendix to the Relators’ Petition for Writ of Mandamus are to my knowledge true and correct copies of the original documents.” An affidavit must be direct and unequivocal such that perjury can be assigned to the statements in it, the court holds. The phrase “to my knowledge” was an equivocal statement implying less than personal knowledge. Because of these deficiencies, the petition for writ of mandamus was denied.

Sonat Exploration Company v. Cudd Pressure Control, Inc., 271 S.W.3d 228 (Tex. 2008)

Reversal on Appeal Applies to Nonappealing Party When Rights of Appealing and Nonappealing Parties Are Interwoven: The Supreme Court acknowledged that, generally, reversal in favor of a party that appealed did not require reversal in favor of another party who did not. Nonetheless, an exception applied when the rights of appealing and nonappealing were so interwoven or dependent on each other as to require a reversal of the entire judgment. This exception often had been applied when indemnity claims or other dependent claims were involved, which was the case here.

Columbia Medical Center of Las Colinas, Inc. v. Hogue, 271 S.W.3d 238 (Tex. 2008)

Heightened Standard of Legal Sufficiency Review For Clear and Convincing Evidence Necessary to Establish Gross Negligence: § 41.003(a)(3) of the Texas Civil Practice and Remedies Code required that gross negligence be proven by clear and convincing evidence. Because of this heightened burden of proof, the Supreme Court reiterated that it must apply a heightened standard of review to determine whether legally sufficient evidence supported a finding of gross negligence. “In a legal sufficiency review, a court should look at all the evidence in the light most favorable to the finding to determine whether a reasonable trier of fact could have formed a firm belief or conviction that its finding was true. To give appropriate deference to the fact-finder’s conclusions and the role of a court conducting a legal sufficiency review, looking at the evidence in the light most favorable to the judgment meant that a reviewing court must assume that the fact-finder resolved disputed facts in favor of its finding if a reasonable fact-finder could do so. A corollary to this requirement was that a court should disregard all evidence that a reasonable fact-finder could have disbelieved or found to have been incredible. This does not mean that a court must disregard all evidence that did not support the finding. Disregarding undisputed facts that did not support the finding could skew the analysis of whether there was clear and convincing evidence.” Here, the Supreme Court held that there was legally sufficient evidence to support the jury’s finding of gross negligence by the medical center.

In re Next Financial Group, Inc., 271 S.W.3d 263 (Tex. 2008, orig. proceeding)

Claim for Wrongful Discharge for Refusing to Commit Illegal Act Arises from Employer’s “Business Activities,” Is Not Subject to Exception for Statutory Employment Discrimination Claims, and Is Therefore Arbitratable: The plaintiff, a former employee of the defendant, had signed an arbitration agreement that provided for arbitration of all disputes “aris[ing] out of the business activities” of the defendant, with the exception of claims “alleging employment discrimination, including sexual harassment, in violation of a statute.” The plaintiff sued the defendant, alleging that he was fired for refusing to conceal another employee’s illegal “churning” transactions. The defendant moved to compel arbitration, but the trial court denied the motion and the court of appeals denied a petition for writ of mandamus to enforce the arbitration agreement under the Federal Arbitration Act. The Supreme Court granted the petition for writ of mandamus. As to the principal issues, the Supreme Court first held that the plaintiff’s claim arose out of the defendant’s business activities because it arose from an employment-related dispute. Second, the Supreme Court held that exceptions in arbitration clauses should be construed narrowly, and the plaintiff’s common law claim did not fall within the exception in the arbitration clause for statutory employment discrimination claims.

In re Transcontinental Realty Investors, Inc., 271 S.W.3d 270 (Tex. 2008, orig. proceeding)

Venue Statutes Providing for Venue Where a Party “Resides” May Still Apply to Corporations or Non-natural Persons: The defendant Transcontinental moved to transfer venue pursuant to a statute providing for venue where a party “resides.” The trial court denied the motion, and the court of appeals denied Transcontinental’s petitioned for writ of mandamus. The Supreme Court granted mandamus relief. The plaintiff argued that an amendment in 1983 to the permissive venues statute, § 15.002(a) of the Texas Civil Practice and Remedies Code, which distinguished between natural and nonnatural persons, evidenced a legislative determination that corporations no longer have a “residence” for any purpose under the venue statutes. The Supreme Court disagreed, holding that many venue statutes continue to refer to “residence” without limiting that term to natural persons.

In re General Electric Company, 271 S.W.3d 681 (Tex. 2008, orig. proceeding)

Forum Non Conveniens Statute; Motion to Dismiss Based On Statute Should Have Been Granted: The plaintiff lived in Maine all his life and worked for over 30 years as a mason handling pipe-covering insulation. After being diagnosed with mesothelioma, he filed suit in Dallas County against over 20 companies, three of which were headquartered in Texas, alleging that various activities by the defendants caused him to be exposed to asbestos. Seven defendants moved for dismissal of plaintiff’s suit based on forum non conveniens, pursuant to § 71.051 of the Texas Civil Practice and Remedies Code. These defendants argued that the suit had no connection to Texas and that Maine was an adequate alternative forum for the case. Following a hearing, the trial court denied the motion to dismiss. The Supreme Court granted mandamus relief. Before 2003, § 71.051 provided that a case brought by a United States resident “may” be stayed or dismissed under the forum non conveniens doctrine, but in that year substituted the word “shall” for “may.” The Supreme Court also disagreed with the plaintiff’s contention that dismissal was appropriate only if all seven factors listed in the statute weighed in favor of dismissal. Nonetheless, the court separately examined each factor and concluded that all supported dismissal.

Perry v. Cohen, 272 S.W.3d 585 (Tex. 2008)

Appellate Briefs To Be Liberally Construed To Reach Merits Whenever Reasonably Possible: The trial court granted the defendants’ special exceptions. After the plaintiffs repleaded, the defendants moved to dismiss on the ground that the plaintiffs failed to comply with the trial court’s prior order sustaining the special exceptions. The trial court rendered an order dismissing the plaintiff’s claims with prejudice. The court of appeals affirmed, holding in part that the plaintiffs waived error as to the merits of the order granting special exceptions by failing to challenge that order in a separate issue. The Supreme Court reversed and remanded to the court of appeals to decide the merits of the appeal. In their first issue in the court of appeals, the plaintiffs contended that the trial court erroneously dismissed their causes of action. The issue did not specify that the shareholders were challenging the trial court’s interlocutory order granting special exceptions, but the arguments under the issue did. “[W]e note that disposing of appeals for harmless procedural defects was disfavored. Verburgt v. Dorner, 959 S.W.2d 615, 616 (Tex. 1997). That policy was reflected in Texas Rule of Appellate Procedure 38.1(f) which provides that the statement of an issue will be treated as covering every subsidiary question that was fairly included. Appellate briefs were to be construed reasonably, yet liberally, so that the right to appellate review was not lost by waiver. See El Paso Natural Gas v. Minco Oil & Gas, Inc., 8 S.W.3d 309, 316 (Tex. 1999). Simply stated, appellate courts should reach the merits of an appeal whenever reasonably possible.”

Autozone, Inc. v. Reyes, 272 S.W.3d 588 (Tex. 2008)

Legal Sufficiency Standard of Review: The Supreme Court reiterated the standard of review for determining whether the evidence was legally sufficient to support a finding. “In reviewing for legal sufficiency of the evidence, we consider the evidence in the light most favorable to the verdict, disregarding all contrary evidence that a reasonable jury could have disbelieved. City of Keller v. Wilson, 168 S.W.3d 802, 827 (Tex. 2005). Even though the evidence was viewed in the light most favorable to the verdict, it could not be considered in isolated bits and pieces divorced from its surroundings; it must be viewed in its proper context with other evidence.

In re Union Carbide Corp., 273 S.W.3d 152 (Tex. 2008, orig. proceeding)

Interpleader; “Justiciable Interest” Requirement for Intervention As Matter Of Right: Moffitt filed a personal injury action alleging that he had been exposed to toxic chemicals distributed, marketed, or manufactured by 14 defendants and that the exposure caused him to develop an acute blood disease. After suit was filed, family members who survived John Hall intervened in Moffitt’s suit, alleging that Hall died from the same blood disease caused by his exposure to toxic chemicals at a facility operated by Union Carbide, one of the original defendants; some but not all of the defendants sued by the Hall survivors were also defendants in Moffitt’s suit. Union Carbide filed a motion to strike the Halls’ intervention because the Halls failed to show that they possessed a justiciable interest in the Moffitt suit. The trial court conducted a hearing on the motion to strike but did not rule on it; instead, the trial court severed the Halls’ claims into a separate suit and directed the suit to be docketed and maintained on the regular docket of the court. Union Carbide petitioned the court of appeals for a writ of mandamus directing the trial court to rule on and grant its motion to strike, but the court of appeals denied the petition. The Supreme Court granted mandamus review. Texas Rule of Civil Procedure 60 authorized a party to intervene, subject to being stricken for sufficient cause on the motion of any party. “The rule authorizes a party with a justiciable interest in a pending suit to intervene in the suit as a matter of right. . . . Because intervention is allowed as a matter of right, the ‘justiciable interest’ requirement is of paramount importance: it defines the category of nonparties who may, without consultation with or permission from the original parties or the court, interject their interests into a pending suit to which the intervenors have not been invited. Thus, the ‘justiciable interest’ requirement protects pending cases from having interlopers disrupt the proceedings. The parties to the pending case may protect themselves from the intervention by filing a motion to strike. . . . If any party to the pending suit moves to strike the intervention, the intervenors have the burden to show a justiciable interest in the pending suit.” To constitute a justiciable interest, the intervenor’s interest must be such that if the original action had never been commenced, and the intervenor had first brought it as the sole plaintiff, he would have been entitled to recover in his own name to the extent of at least a part of the relief sought in the original suit. Here, the Halls could not have brought any part of Moffitt’s claim. Although there was a real controversy between the Halls and Union Carbide, the Halls made no claim that their controversy will be affected or resolved by resolution of the Moffitt case. The trial court had no discretion to refuse to rule on Union Carbide’s motion to strike before it considered severing the Hall case from the Moffitt case. The trial court abused its discretion in failing to first rule on the motion to strike.

In re Department of Family & Protective Services, 273 S.W.3d 637 (Tex. 2009, orig. proceeding)

Abuse of Discretion Standard As To Interpretations of Law: The Supreme Court reiterated the abuse of discretion standard as it applied to a trial court’s interpretation of the law. “We review a trial court’s interpretation of the law de novo. . . . A trial court has no discretion in determining what the law is or properly applying the law. . . . If the trial court fails to properly interpret the law or applies the law incorrectly, it abuses its discretion.”

Granting of New Trial Wipes Slate Clean: “When a trial court grants a motion for new trial, the case is reinstated on the trial court’s docket as though no trial had occurred, and the slate is essentially wiped clean as to orders such as an oral pronouncement of judgment and written judgment based on the trial.”

Dallas Area Rapid Transit v. Amalgamated Transit Union Local No. 1338, 273 S.W.3d 659 (Tex. 2008)

Supreme Court’s “Conflicts” Jurisdiction Extends to Conflicts Between the Opinions of Texas Courts of Appeals and of the United States Supreme Court: In Eichelberger v. Eichelberger, 582 S.W.2d 395 (Tex. 1979), the Texas Supreme Court held that it had jurisdiction in cases where the opinion of the court of appeals conflicts with an opinion of the United States Supreme Court. The Texas Supreme Court adhered to this holding. The court provided a brief historical summary of its jurisdiction, then briefly reviewed its holding in Eichelberger. “In the nearly 30 years since we decided Eichelberger, we have not invoked our constitutional jurisdiction to remove a conflict between a Texas appellate court and the United States Supreme Court, but we adhere to our holding that this court has such jurisdiction. From 1892 to 1953, the decisions of the courts of civil appeals were final in some cases and not subject to this court’s review, but this court has never lacked jurisdiction to prevent an intermediate appellate court from conflicting with one of this court’s decisions. It is fundamental to the very structure of our appellate system that this court’s decisions be binding on the lower courts. We have no less authority to insure that the lower courts follow the United States Supreme Court. Nor should our holding in Eichelberger apply with any less force in interlocutory appeal.”