Case Updates for January and February 2017

By Andrew Nelson, Wright & Close, LLP, and Leslie Gardner, 14th Court of Appeals

FIRST COURT OF APPEALS

Ayele, d/b/a MAE Solutions, LLC v. Jani-King of Houston, Inc., No. 01-16-00007-CV, 2017 WL 769911 (Tex. App.—Houston [1st Dist.] Feb. 28, 2017, no pet. h.)

A court cannot grant a post-answer default summary judgment when a defendant’s failure to file a response is not due to conscious indifference.

MAE Solutions, LLC (“MAE”) sued Jani-King of Houston, Inc. (“Jani-King”) for several causes of action arising from a failed franchising relationship. Jani-King filed a motion for summary judgment and set the motion for submission on the court’s September 7 docket. MAE filed a motion for continuance on the grounds that its counsel had a vacation letter on file for September 7. The court granted the continuance and interlineated on the order that the motion would be set for submission on October 5th. The court did not send a notice of hearing, and Jani-King did not either. When MAE did not file a response prior to the October 5 hearing, the court granted the summary judgment. Later, counsel for MAE received a postcard notifying him that the summary judgment had been signed. Counsel filed a motion for new trial, attaching an affidavit to prove that he had not received notice of the hearing. The trial court denied the motion for new trial, and MAE appealed.

On appeal, MAE argued that the trial court abused its discretion in denying its motion for new trial because it satisfied its burden under Craddock v. Sunshine Bus Lines, Inc., 133 S.W.2d 124 (Tex. 1939), to set aside the default judgment. The court noted that the Supreme Court has held that Craddock does not apply when a party opposing summary judgment had notice of the hearing and an opportunity to obtain leave to file a late response before the hearing date. However, when a party does not have notice of the submission date, the court must apply Craddock, which states that a court should set aside a default judgment if (1) its failure to respond resulted from an accident or mistake and not from conscious indifference or an intentional act; (2) the motion for new trial alleges a meritorious defense; and (3) granting the motion will not cause undue delay or otherwise injure the plaintiff.

In the case before it, the court held that the undisputed, verified facts were specific enough to affirmatively prove MAE’s lack of notice. The court noted that “conscious indifference means more than mere negligence.” A defendant may show lack of conscious indifference by providing an excuse that is not controverted and, if true, negates intentional or consciously indifferent conduct on its part. “An excuse need not be a good one to suffice.” The court held that regardless of whether MAE’s counsel should have seen the court’s order granting the continuance and re-setting the submission date, MAE proved that its counsel had not, in fact, seen the order. Accordingly, MAE’s failure to respond was not the result of conscious indifference, and the summary judgment should have been set aside.

Justice Lloyd dissented. He argued that conclusory statements by counsel that counsel did not have notice of the new submission date did not meet the Craddock standard. He would require more from a lawyer such as MAE’s such as an explanation of why counsel did not see the order. He would require the attorney to explain why he did not monitor the status of his motion for continuance. If the attorney monitored the status of his motion for continuance, he would have seen the order re-setting the submission date. Justice Lloyd did not believe the evidence showed an abuse of discretion on the part of the trial court.

Garcia v. Figueroa, No. 01-15-01010-CV, 2017 WL 491284 (Tex. App.—Houston [1st Dist.] Feb. 7, 2017, no pet. h.)

Failure to include a complete reporter’s record when challenging the factual sufficiency of a trial court’s judgment will lead to affirmance of the judgment.

Garcia sued Sasson, her landlord, for issues related to an easement that went through the property. After a jury trial the court rendered judgment that Garcia take nothing from Sasson. Garcia filed a motion for JNOV, arguing that her requested admissions from Sasson were deemed because he failed to timely respond. In the alternative, she filed a motion for new trial arguing that the jury’s findings were against the great weight and preponderance of the evidence. Sasson filed a motion to withdraw the alleged deemed admissions. The trial court granted Sasson’s motion and denied both of Garcia’s motions.

After losing in the trial court, Garcia requested a partial reporter’s record that included some of the trial exhibits. The record did not include all of the exhibits or the trial transcripts. In her notice of appeal, Garcia stated that she “desire[d] to appeal on deemed admissions and other grounds.”

In her brief, Garcia raised the sole issue that the trial court erred in denying her motion for new trial because the jury’s answers were against the great weight and preponderance of the evidence. Sasson argued that Garcia failed to comply with Texas Rule of Appellate Procedure 34.6(c), governing the filing of a partial reporter’s record.

An appellant can request a partial reporter’s record and “include in the request a statement of points or issues to be presented on appeal and will then be limited to those points and issues.” Tex. R. App. P. 34.6(c)(1). An appellant cannot simply give general notice of stated points and issues; rather, the points or issues should be described with some particularity. When an appellant properly requests a partial reporter’s record, the court must “presume that the partial reporter’s record designated by the parties constitutes the entire record for purposes of reviewing the stated points or issues.” Tex. R. App. P. 34.6(c)(4). However, nothing in Rule 34.6(c) relieves an appellant of her burden to bring forth a record showing reversible error. Rule 34.6(c), when properly complied with, prevents the application of the general presumption that missing portions of the record support the trial court’s judgment. Thus, if the rule is not properly followed, the court must presume that the omitted portions support the trial court’s judgment.

In the case before it, Garcia stated only that she “desire[d] to appeal on deemed admissions and other grounds.” Thus, the court held, she was entitled to the presumption that the partial record was complete only for purposes of reviewing deemed admissions. Because the only issue she raised in her brief was a factual sufficiency point, the court presumed that any omitted portions of the record supported the trial court’s judgment. The court dismissed Garcia’s argument that Sasson could show no harm because he was able to supplement the record if he so desired. The court noted that the fact that Rule 34.6(c)(2) allows supplementation does not relieve the appellant of her own burden to bring forth an adequate record in the first place.

Presuming that the omitted portions of the record supported the trial court’s judgment, the court affirmed the judgment.


FOURTEENTH COURT OF APPEALS

Arceneaux v. Pinnacle Entertainment, Inc., No. 14–15–00894–CV, 2017 WL 716631 (Tex. App.—Houston [14th Dist.] Feb. 23, 2017, no pet. h.)

Proportionate-responsibility statute in Chapter 33 of the Texas Civil Practice and Remedies Code applies to intentional torts.

Plaintiff Roy Arceneaux became disruptive at a Pinnacle casino, where he was drinking and gambling. A security officer asked him to cash his chips and leave. When Arceneaux did not comply, casino security officers brought him to the ground in an effort to subdue him.

Arceneaux filed for various claims against Pinnacle including civil assault. After trial, the jury found that Pinnacle committed assault against Arceneaux; that Arceneaux contributed to the occurrence or injuries; that Arceneaux was 70 percent responsible and Pinnacle was 30 percent responsible; and that a total of $40,000 would fairly and reasonably compensate Arceneaux.

If chapter 33 applies to a claim, a claimant may not recover damages if his proportionate responsibility is greater than 50 percent. Tex. Civ. Prac. & Rem. Code Ann. § 33.001 (West 2013).

Pinnacle filed a motion for entry of a final take-nothing judgment asserting sections 33.001 and 33.002 of the Texas Civil Practice and Remedies Code apply. Arceneaux moved for judgment in his favor arguing those sections do not apply. The trial court entered a final, take-nothing judgment in favor of Pinnacle.

Arceneaux argued on appeal that the trial court erred because the jury found that Pinnacle committed assault against him and it rejected Pinnacle’s defenses to assault. Pinnacle responded that the trial court did not err because the jury determined that Arceneaux was 70 percent responsible and chapter 33 applies to intentional torts.

The Fourteenth Court agreed with Pinnacle and affirmed the trial court’s take-nothing judgment. The panel concluded chapter 33 applies to assault claims for three reasons. First, chapter 33 is broad and applies to “any cause of action based on tort in which a defendant . . . is found responsible for a percentage of the harm for which relief is sought.” Tex. Civ. Prac. & Rem. Code § 33.002(a) (West 2013). Second, the panel concluded that section 33.002 is unambiguous and does not provide any exclusion for intentional torts. The panel pointed out that the 1987 version of chapter 33 expressly excluded intentional torts, but the 1995 amendments removed the exclusion. Third, Texas courts of appeals have rejected arguments that chapter 33 does not apply to the intentional tort of fraud, and that a Southern District of Texas federal district court rejected an argument that chapter 33 does not apply to assault.

Lastly, the court rejected Arceneaux’s argument that the jury’s rejection of an affirmative defense displaces the broad application of chapter 33. The court affirmed the trial court’s judgment.

In re C.Y.K.S., No. 14–15–00554–CV, 2017 WL 536644 (Tex. App.—Houston [14th Dist.] Feb. 9, 2017, no pet. h.)

Section 231.211(a) of the Family Code does not apply to the assessment of appellate costs.

This is a supplemental opinion on the denial of appellee’s motion for rehearing. The Fourteenth Court reversed a trial court’s order that dismissed for lack of jurisdiction an order that modified appellant’s monthly child-support obligation. The Fourteenth Court ordered appellee to pay all costs incurred by reason of this appeal. Appellee moved for a rehearing on the ground that section 231.211(a) of the Family Code bars the appellate court from ordering her to pay costs.

The court denied the rehearing motion and concluded that section 231.211(a) does not bar the court from assessing appellate costs against appellee.

Section 231.211(a) provides that “[a]t the conclusion of a Title IV-D case, the court may assess fees . . . except that the court may not assess [attorney’s fees and court costs] against . . . any party to whom the [Title IV-D] agency has provided services under this chapter.” A “Title IV-D case” means “an action in which services are provided by the Title IV-D agency under Part D, Title IV, of the federal Social Security Act (42 U.S.C. § 651 et seq.). The court presumed that appellee was a party to whom services had been provided because the Texas Attorney General’s Office, a designated Title IV-D agency, had filed child-support enforcement actions in the case. The court also made a presumption that the Fourteenth Court of Appeals fell within the definition of “court.” Tex. Fam. Code Ann. § 101.008 (West, Westlaw through 2015 R.S.).

Three other courts of appeals have concluded section 231.211(a) applies to the assessment of appellate costs. See Target Logistics, Inc. v. Office of Att’y Gen., 465 S.W.3d 768, 770 (Tex. App.—El Paso 2015, no pet.) (applying section 231.211(a) to the assessment of appellate costs); In re J.D.D., No. 05-10-01488-CV, 2011 WL 5386370, at *4 (Tex. App.—Dallas Nov. 9, 2011, no pet.) (applying section 231.211(a) to the assessment of appellate costs against party to whom the Title IV-D agency had provided services); In re Z.H.S., No. 13-08-00204-CV, 2009 WL 265274, at *1 (Tex. App.—Corpus Christi Feb. 5, 2009, no pet.) (same as Target Logistics). Because those decisions did not analyze the language of the statute, the court respectfully declined to follow those courts of appeals.

The court conducted a plain language analysis of section 231.211(a). The court said that the plain language of “at the conclusion of a Title IV-D case” meant at the conclusion of the trial court proceedings. Finding otherwise would mean there would be two conclusions—the conclusion of a trial and the conclusion of an appeal. This would be contrary to the plain meaning of “conclusion.” Moreover, if appellate courts applied 231.211(a) it would mean that appellate courts would be making findings on reasonable and necessary attorney’s fees, which is contrary to Texas law.

The court denied appellee’s motion for rehearing and concluded the court had the authority to order her to pay appellate court costs for good cause. See Tex. R. App. P. 43.4.

In re Marshall, No. 14–17–00038–CV, 2017 WL 370117 (Tex. App.—Houston [14th Dist.] Jan. 24, 2017, orig. proceeding)

After a party files a motion to recuse, a respondent judge must, within three business days, grant the motion to recuse or refer the motion to the regional presiding judge, regardless of whether the motion complies with the Texas Rule of Civil Procedure 18a(f)(1).

During a hearing on a temporary restraining order, relator filed a handwritten motion to recuse the trial judge. The trial judge responded that he believed the handwritten motion did not comply with the rules, but took the motion under advisement. After the hearing, he signed the TRO without granting the motion or referring the motion to the regional presiding judge. Relator filed a petition for writ of mandamus.

The Fourteenth Court conditionally granted the writ of mandamus. Justice Jewell, writing for the majority, explained that under the clear language of Rule 18a(f)(1), a judge must either recuse or refer the motion, even if the motion is defective. Real party in interest had cited a line of cases holding that a relator waives any right to complain of a judge’s refusal to recuse if the motion does not comply with the mandatory requirements of Rule 18a. Those cases, however, were decided before the rule was amended in 2011 to say a judge must recuse or refer “regardless of whether the motion complies with this rule.” Tex. R. Civ. P. 18a(f)(1).

Alternatively, the real party in interest argued that respondent had good cause for issuing the TRO before the motion to recuse was decided. The Fourteenth Court concluded the record was insufficient to support a “good cause” argument.