Rule 91a Dismissal Based on Affirmative Defense of Derived Judicial Immunity

Sposito v. Rollins-Threats

Dallas Court of Appeals, No. 05-23-00597-CV (July 10, 2024)

Justices Justices Partida-Kipness (Opinion, linked here), Pedersen III, and Carlyle

Ken Carroll

In a suit affecting the parent-child relationship (SAPCR), the family court appointed Dr. Rollins-Threats as a “parenting facilitator.” Displeased with the SAPCR process and outcome, Sposito sued Rollins-Threats for malpractice, “child endangerment,” and slander, alleging she had “violated state and federal laws,” “told multiple lies,” and “violated [Sposito’s] rights,” in the course of the SAPCR proceedings. Rollins-Threats responded with a motion to dismiss under Rule 91a, asserting  the affirmative defense of “derived judicial immunity” in her role as a court-appointed parenting facilitator. The trial court granted that motion, dismissing Sposito’s case, and the Dallas Court of Appeals affirmed. 

Under Rule 91a, a court may dismiss a cause of action that has no basis in law or fact. A claim has no basis in law “where the allegations in the plaintiff’s own pleading establish a complete legal bar to the plaintiff’s claims by affirmatively negating entitlement to the relief requested.” That can include dismissal on the basis of an affirmative defense, if (1) the plaintiff’s own pleading establishes that affirmative defense, and (2) the affirmative defense has been pleaded by the defendant and is properly before the court. 

Here, as noted, Rollins-Threats had pleaded the affirmative defense of derived judicial immunity. “When entitled to the protection of derived judicial immunity, an officer of the court receives the same immunity as a judge acting in his or her official judicial capacity—absolute immunity from liability for judicial acts performed within the scope of [his or her] jurisdiction.” Texas courts apply a “functional approach” to determine if a party is entitled to such immunity, focusing on whether the conduct of the person appointed by the court is like that of the delegating or appointing judge. “If the tasks necessitate the exercise of discretion, judicial immunity will apply.”

The Court of Appeals found no cases addressing whether a court-appointed parenting facilitator is entitled to derived judicial immunity. But after examining Dr. Rollins-Threats’s assigned duties, the Court held that she met the standard for immunity, that Sposito’s claims all rested on Rollins-Threats’s performance of her duties as a court-appointed parenting facilitator, and therefore that the trial court properly dismissed Sposito’s claims under Rule 91a. 

Owner Testimony about Value: “Because I Said So” Isn’t Enough

Hernandez v. Ayala

Dallas Court of Appeals, No. 05-23-00549-CV (June 18, 2024)

Justices Smith (Opinion, linked here), Miskel, and Breedlove

Ken Carroll

Customarily, an owner may testify about the value of his or her property in a Texas trial court. Testimony of an independent expert isn’t required. But to be legally sufficient, an owner’s testimony about value must embody and convey more than the owner’s unsupported, unsubstantiated guess.

A partnership dispute arose between Hernandez and Ayala. At trial, the jury awarded Ayala $104,000 in damages based on the value of partnership property Ayala testified Hernandez had wrongfully withheld from him. The Dallas Court of Appeals, however, reversed that damages award.

The sole evidence establishing the value of the disputed property came from Ayala. Although an owner may testify to the value of his or her own property, “valuations may not be based solely on a property owner’s ipse dixit. An owner may not simply echo the phrase ‘market value’ and state a number …; he must provide the factual basis on which his opinion rests.” Nat. Gas Pipeline Co. v. Justiss, 397 S.W.3d 150, 159 (Tex. 2012). “Because property owner testimony is the functional equivalent of expert testimony, it must be judged by the same standards.” Id. 

Ayala “provided no basis for his valuations of the property. He did not testify that he was familiar with the market value of the partnership property or otherwise explain how he determined the value of each item.” Ayala’s testimony therefore was legally insufficient to support the jury’s damages verdict. 

Designating an Unknown Person as a Responsible Third Party

In re Chitkara

Dallas Court of Appeals, No. 05-24-00482-CV (June 12, 2024)

Justices Pedersen III, Smith (Opinion, linked here), and Garcia 

Ken Carroll

If a defendant wants to designate an unknown person as a responsible third party, Civil Practice & Remedies Code § 33.004(j) prescribes unique requirements—distinct from those governing designation of known persons— that must be closely followed.

Chitkara sued Ortiz and his employer, Hellas Construction, when Ortiz abruptly pulled in front of Chitkara on the Dallas North Tollway, causing a collision. Ortiz and Hellas alleged in their answer that “the occurrence in question was the result of a person not a party to the suit.” They subsequently sought to designate this “John Doe” as a responsible third party under CPRC Chapter 33. The trial court granted that request, but the Dallas Court of Appeals disagreed on mandamus, directing that the order be vacated.

Section 33.004(j) provides the “exclusive” procedure and delineates the specific requirements for a defendant to designate an “unknown person” as a responsible third party:

• The defendant must allege in the answer “that an unknown person committed a criminal act that was a cause of the loss or injury that is the subject of the lawsuit” and must plead “facts sufficient for the court to determine that there is a reasonable probability that the act of the unknown person was criminal";
• The defendant must state in its answer “all identifying characteristics of the unknown person, known at the time of the answer”; and
• The pleading containing these required allegations must be filed “not later than 60 days after the filing of the defendant’s original answer.”

Although Ortiz and Hellas vaguely alleged that “the occurrence in question was the result of a person not a party to the suit,” they did not allege criminal conduct or facts sufficient to show criminal conduct. Nor did they allege “all identifying characteristics of the unknown person.” The trial court therefore abused its discretion by granting the motion to designate. The Court of Appeals also rejected defendants’ argument that they should be allowed to replead to add the required allegations, saying that would undermine the “explicit timing requirement” of § 33.004(j).

Oh Deer...No TRO During Appeal

 In re: Texas Parks and Wildlife Department

Dallas Court of Appeals, No. 05-24-00582-CV (May 23, 2024)

Justices Reichek, Carlyle, and Miskel (opinion available here)

Kelli Hinson

Lesson learned: serving an out-of-state registered agent for the out-of-state defendant is not proper service under Texas law. 

The owners of a commercial deer-breeding facility brought suit to enjoin the Texas Parks and Wildlife Department from carrying out a “deer depopulation order” after the detection of Chronic Wasting Disease at the facility. The trial court denied the Department’s plea to the jurisdiction and entered a temporary injunction, and the Department filed an interlocutory appeal. The Dallas Court of Appeals entered a temporary order preventing the depopulation pending resolution of the appeal, but the Supreme Court stayed that Order. The trial court then entered a TRO regarding the manner of the depopulation. The Department sought mandamus to vacate that TRO.

The Court of Appeals conditionally granted the writ, holding that the TRO violated CPRC §51.014(b)’s automatic stay. Section 51.014(b) stays the commencement of trial pending most interlocutory appeals. But in the case of certain specified appeals, it goes further and “stays all other proceedings in the trial court pending resolution of [the] appeal,” as well. An appeal from the denial of a plea to the jurisdiction by a governmental unit—like that taken by the Department here—gives rise to that more extensive stay, which the appeals court held prohibits entry of a TRO. The trial court therefore abused its discretion in issuing a TRO in violation of the automatic stay.

WAIT…I CAN’T SERVE THE REGISTERED AGENT?

Lawton Candle, LLC v. BG Personnel, LP

Dallas Court of Appeals, No. 05-23-00449-CV (May 13, 2024)

Justices Garcia, Breedlove (Opinion), and Kennedy

Neil R. Burger

Lesson learned: serving an out-of-state registered agent for the out-of-state defendant is not proper service under Texas law.  

In this restricted appeal, the Oklahoma defendant, Lawton Candle, LLC, claimed the default judgment against it was improper because it had not been properly served with process. The plaintiff, BG Personnel, LP, had served Lawton Candle with the lawsuit through its registered agent in Oklahoma because Lawton Candle did not maintain a registered agent in Texas. When Lawton Candle did not timely answer the petition, BG Personnel obtained a default judgment. 

To reverse a default judgment on restricted appeal a defendant must show “error [that is] is apparent on the face of the record.” Defective service constitutes such an error. Appellate courts strictly enforce service rules when reviewing default judgments. Thus, the question here was: is service on a party’s agent registered in another state authorized by Texas law? The Court held that it was not.

Section 5.201(b) of the Texas Business Organizations Code authorizes service on a business entity’s registered agent, president, or any vice president. And section 5.255(3) allows service on each manager of a manager-managed domestic LLC. For a foreign LLC, section 2.256 adds to those methods any “other means of service of process . . . as provided by law.” Although this would indicate that service of Lawton Candle’s Oklahoma registered agent was effective, section 5.201 prohibits registered agents from being a resident of a different state. 

Based on this language, the only means recognized by the Business Organizations Code to serve an out-of-state entity with no registered agent in Texas is through the Texas Secretary of State pursuant to section 5.251, which makes the Secretary of State the registered agent for foreign companies that don’t maintain one in Texas. 

The Court noted that its “strict compliance” interpretation of the service rules may yield a “rather weird conclusion[],” but determined it was good public policy in the end. Therefore, the Court vacated the trial court’s default judgment and remanded the case.

"Just Throw it Away"

In the Interest of MBG and ATG
Dallas Court of Appeals, No. 05-23-00505-CV (May 2, 2024)
Justices Partida-Kipness, Nowell (opinion available here), and Smith

Kelli Hinson

You can’t always trust your soon-to-be ex-husband. The wife in this divorce case learned that the hard way when she failed to answer or appear at trial and was unhappy with the orders entered by the Court. She filed a motion for new trial, arguing she met the Craddock factors. She testified that her failure to respond was not due to conscious indifference because, after she received the divorce petition, the husband told her to “throw it away and wait to hear from his lawyer regarding mediation.” Relying on that advice, the wife failed to take any action to protect herself in the divorce proceeding. The trial court was unconvinced, however, particularly given that the wife later received an email from the husband’s lawyer saying that the divorce petition was on file and the husband did wish to move forward.

The Court of Appeals agreed with the trial court and affirmed the denial of the wife’s motion for new trial. It held that “conscious indifference” includes behavior such as a “pattern of ignoring deadlines and warnings from the opposing party” and failing “to take some action which would seem indicated to a person of reasonable sensibilities under the same or similar circumstances.”

The Court of Appeals did grant the wife some relief, however. It held that the trial court abused its discretion in awarding the husband more relief than requested in his petition. Texas is a “fair notice” state, which means that all parties are entitled to fair notice of a claim, and a trial court may not grant relief to a person who has not requested such relief in a live pleading. 

No Interlocutory Appeal from Denial of Ken Paxton’s Plea to Jurisdiction in Disciplinary Case

Paxton v. Commission for Lawyer Discipline
Dallas Court of Appeals, No. 05-23-00218-CV (April 18, 2024)
Justices Nowell (Opinion, linked here), Miskel (Dissent, linked here), and Kennedy

Ken Carroll

 More fallout from failed litigation regarding purported irregularities in the 2020 presidential election. A day after one panel of the Dallas Court of Appeals unanimously affirmed summary judgment rejecting the State Bar’s disciplinary charges against Sidney Powell—largely because of the Bar’s less-than-ideal briefing at trial and on appeal—another divided panel of that same court found it lacked jurisdiction to review a trial court’s denial of Ken Paxton’s plea to the jurisdiction regarding the Bar’s disciplinary action against him.

The State Bar’s Commission for Lawyer Discipline alleged that Paxton made “‘dishonest’ representations to the Supreme Court [in his role as lead counsel for the State] in Texas v. Pennsylvania.” The Commission contended these alleged misrepresentations “constitute[d] professional misconduct and violate[d] Rule 8.04(a)(3) of the Texas Disciplinary Rules of Professional Conduct.” Paxton filed a plea to the trial court’s jurisdiction, asserting the Commission’s action violated the separation-of-powers doctrine and was barred by sovereign immunity. When the trial court denied that plea, Paxton sought appellate review pursuant to TCPRC § 51.014(a)(8), which authorizes interlocutory appeal from an order that “grants or denies a plea to the jurisdiction by a governmental unit” of the State or, by judicial extension, a plea by a State official sued in his or her official capacity. Paxton contended that, because Texas law directs only the Attorney General to “prosecute and defend all actions in which the state is interested,” the Bar Commission’s case was effectively leveled against him in his official capacity and the AG’s office itself; the denial of his plea, therefore, fell within § 51.014(a)(8).

But the Dallas Court disagreed. The Court noted that the Commission did not challenge the AG’s discretionary decision to file the Texas v. Pennsylvania lawsuit, but instead targeted specific alleged misrepresentations made by Paxton as counsel in that case. And the Commission sought no relief against the AG’s office or Paxton in his official capacity, but only against Paxton individually as an attorney licensed by the State of Texas. Therefore, the Court concluded, the trial court’s denial of Paxton’s plea to the jurisdiction did not fall within § 51.014(a)(8), and it had no jurisdiction to hear the interlocutory appeal.

Justice Emily Miskel dissented. A lot. She would have found jurisdiction for the appeal under § 51.014(a)(8) and reversed the trial court’s denial of Paxton’s plea to the jurisdiction, arguing the Commission’s action targeted Paxton in his official capacity and was barred by the separation-of-powers doctrine as well as sovereign immunity. She went on to contend the Commission’s complaint also was defective on the merits.

Last year—foreshadowing this case—the El Paso Court of Appeals rejected separation-of-powers and sovereign-immunity defenses in a similar disciplinary action brought by the Commission against First Assistant AG Brent Webster, also based on alleged misrepresentations in Texas v. Pennsylvania. Comm’n for Lawyer Discipline v. Webster, 676 S.W.3d 687 (Tex. App.—El Paso 2023). Webster filed a petition for review in the Supreme Court of Texas. The petition remains pending, with briefs on the merits having been requested and filed. So, there’s more to come in Webster and likely in the Paxton case, as well.

TRAP 24.2’s $25-million Supersedeas Cap Applies Per Judgment Debtor, Not Per Judgment

Greystar Development & Construction, LP  v. Williams

Dallas Court of Appeals, No. 05-23-01168-CV (April 10, 2024)

Justices Molberg, Carlyle, and Breedlove (Opinion, linked here)

Ken Carroll

Williams secured a judgment holding three defendants jointly and severally liable for actual damages of more than $360 million. The three defendants posted one joint bond in the total amount of $25 million—the supersedeas “security” cap prescribed by TCPRC § 52.006(b)(2) and TRAP 24.2(a)(1)(B)—contending this was sufficient to suspend execution against all three, pending appeal. Pursuant to TRAP 24.1(b)(2), however, the trial court reviewed the joint bond and found it did not comply with the statute or the rule and did not suspend enforcement of the judgment. The trial court reasoned that the $25-million cap applied to each judgment debtor, rather than to the judgment as a whole. The court directed the defendants to specify which of them would be covered by the existing bond and then to file additional bonds for the other two defendants in order to suspend execution. Defendants, who by then had commenced an appeal on the merits, filed a motion pursuant to TRAP 24.4 seeking appellate review of the trial court’s ruling. 

The Dallas Court of Appeals affirmed the trial court’s decision. The Court noted a split of authority about whether the $25-million cap was to be applied per judgment or per judgment debtor. In Huff Energy Fund, LP v. Longview Energy Co., a divided panel of the San Antonio Court had held the cap applied to the judgment as a whole. The Tyler Court, however, came to the opposite conclusion in John M. O’Quinn, PC v. Wood. The Tyler court reasoned that the Civil Practice and Remedies Code defines “security” to mean “a bond or deposit posted … by a judgment debtor to suspend execution of the judgment during appeal of the judgment.” 

The Dallas Court found the reasoning of the Tyler Court persuasive and adopted its resolution, “hold[ing] that the $25-million cap in § 52.006 of the Texas Civil Practice and Remedies Code [and TRAP 24.2] applies per judgment debtor and not per judgment."

  

  

State Bar of Texas - Appellate Section: Nominations to the Texas Appellate Hall of Fame

 

 State Bar of Texas – Appellate Section

 Nominations to the Texas Appellate Hall of Fame 

A few years ago, CCSB co-founder and appellate legend Marvin Sloman was inducted into the Texas Appellate Hall of Fame. The recognition was richly deserved and a great honor for Marvin and the firm.

Now it’s your opportunity to nominate a worthy practitioner to join Marvin and others in the Hall. The Appellate Section will honor new Hall of Fame inductees at a presentation and ceremony during this year’s Advanced Civil Appellate Practice course and Section meeting, scheduled for September 5-6, 2024. 
Guidelines for nominating someone, as well as a link for submitting your nomination, are found here. Nominations should be submitted no later than Thursday, May 30, 2024.

Judicial Admissions: Be Careful What You Plead, and How

Advantage Aviation Technologies, Inc. v. Axcess Aviation Maintenance Services, Inc.

Dallas Court of Appeals, No. 05-23-00344-CV (December 27, 2023)

Justices Molberg (Opinion, linked here), Pedersen III, and Smith

Ken Carroll

Axcess secured judgment against Advantage Aviation for breach of two contracts. Advantage challenged that judgment on appeal by arguing that it had no contracts with Axcess and that the contracts on which the judgment was based were between Axcess and a different party. Problem was, in the trial court Advantage had counterclaimed, unsuccessfully, for breach of the very same contracts that it tried to deny on appeal. And it had done so “without equivocation and not in the alternative,” alleging it sustained damages of more than $90,000 from Axcess’s breach of those contracts. Oops.

Citing its prior opinion in Murphy v. Killer Ridez, Inc., No. 05-13-00035-CV, 2014 WL 428987, the Dallas Court of Appeals summarily rejected Advantage’s appeal and affirmed, saying: 

Assertions of fact, not pleaded in the alternative, in the live pleadings of a party are regarded as formal judicial admissions. … A judicial admission that is clear and unequivocal is conclusive upon the party making it; it relieves the opposing party of the burden of proving the admitted fact and bars the admitting party from disputing it.