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Gray's Interesting Cases for February, 2010

Updated and presented by Sallee S. Smyth
  1. Bishop v. Smith, 2009 Tex. App. LEXIS 9928 (Tex. App. – Beaumont December 31, 2009) (mem. opinion) (Cause No. 09-08-185-CV)

    H filed for divorce against W and W counterclaimed. In a separate cause number, Bishop sued H and W and their FLIP claiming that H, W and the FLIP owed her at least $760K. Bishop moved to consolidate her suit with the divorce which was granted. Thereafter the court appointed a receiver (Smith) to (1) manage and oversee the sale of a note owned by the FLIP; (2) to manage and oversee the repairs and potential sale of a residence owned by H & W; and (3) to manage and oversee the collection and distribution of rental process on all rental property owned by H& W. The court gave Smith the authority to hold and control any monies relating to the identified properties as she deemed necessary. No party objected to the receiver’s appointment. At various times Smith would file motions (attaching her invoices) and asking the court to approve her receiver fees. The trial court approved four of these motions contingent upon the ultimate sale of the properties. After trial, H, W & Bishop negotiated a settlement and the trial court signed a final decree which recognized Smith’s continued authority to oversee the sale of a note receivable. During post-trial hearings it was discovered that Bishop and W had taken various actions which interfered with the potential value of the note receivable and the receiver’s efforts to sell it. At the conclusion of these hearing the court ordered Bishop to pay all of the receiver’s fees and Bishop appealed.

    First Bishop argued that she was not a party to the divorce but the COA recognized that since Bishop’s suit had been consolidated with the divorce and one order (the decree) had been signed, H, W and Bishop became parties to the consolidated suit and the court had the authority to assess costs against any of them. Bishop also alleged that the trial court had lost plenary power over the decree and could not modify any terms for the payment of receiver fees contained in that decree. The COA noted that the trial court retained jurisdiction over the receivership until it was terminated and the receiver was discharged and thus retained jurisdiction over the receivership contained within the final decree. Further the COA noted that a party’s wrongful conduct may be considered in the award of receivership fees.

  3. Brejon v. Johnson, 2009 Tex. App. LEXIS 9902 (Tex. App. – Houston [1st Dist.] December 31, 2009) (Cause No. 01-08-897-CV)

    H & W divorced in 2007 under terms of an agreed decree sharing custody of their only child. In 2008 W filed suit to increase child support from $1200 to $1500 per month arguing that the existing support did not comport with the guidelines. At trial, W testified that H did not consistently exercise his visitation and that her promotion at work had caused longer working hours and increased responsibilities, requiring her to hire additional sitters or fly her mother in to assist with the child. W also testified to increased expenses including higher gasoline bills and medical expenses. H testified that his salary remained the same and that child care costs were W’s responsibility (making it a point to remind the trial court that W is the one that wanted custody!). After trial the court increased c/s to $1500/month and ordered H to pay attorneys fees. H filed a notice of appeal in July. W filed a motion to enforce payment of fees in August and thereafter filed a motion seeking appellate fees in September. The court heard the motions at the same time and issued one order enforcing the payment of fees from the final order and awarding fees on appeal. H appealed this order as well.

    In a consolidated appeal the COA found sufficient evidence of material and substantial change to modify c/s. Further, the COA examined its jurisdiction to consider an appeal from the post judgment enforcement/temporary order because a portion of the order was based on temporary relief sought pending appeal. Ultimately the COA concluded that the order was final as an enforcement order over which it had jurisdiction. The COA affirmed that portion of the order enforcing the prior award of fees however vacated the award of appellate fees because the TFC 109.001 motion had been filed more than 30 days after the final modification order and thus the trial court was without jurisdiction to award appellate fees in that circumstance.

  4. Alexander v. Johnson, 2010 Tex. App. LEXIS 3 (Tex. App. – Houston [14th Dist.] January 5, 2010) (mem. opinion) (Cause No. 14-08-778-CV)

    M and F (unmarried) had a child. The day after the child’s birth, F signed an acknowledgement of paternity. After their relationship ended, F filed a SAPCR seeking custody. M filed a countersuit. F later changed his mind and amended his pleadings to seek a voluntary termination of his parental rights. When the case was called for trial, F did not appear and the court entered a default judgment adjudicating F’s paternity and ordering him to pay child support. F then filed a petition for bill of review alleging that M had fraudulently induced him into signing the AOP and that he did not believe he was the father. F claimed that he had previously requested genetic testing which was denied and that he could not attend the first trial because he was working offshore. After hearing, the court denied the bill of review and F appealed. On appeal F claimed that because he did not think he was the child’s father this constituted a meritorious defense which the court did not allow him to present because they denied genetic testing.

    The COA held that the properly executed AOP is sufficient to support the default judgment and that the meritorious defense should have bee directed against the AOP and F should have brought a recission proceeding under TFC 160.307 but the time for that had now expired. The COA then noted that F could have brought an action to challenge the AOP under TFC 160.308(a) as part of the bill of review proceeding but because he did not do so he did not establish a meritorious defense as a matter of law. Judgment denying bill of review affirmed.

  5. Taylor v. Speck, 2010 Tex. App. LEXIS 16 (Tex. App. – San Antonio January 6, 2010) (Cause No. 04-09-278-CV)

    H & W divorced in 1967 DR Court #2 Dallas County, Texas. H was ordered to pay c/s of $30.00/week beginning in October 1967 until the youngest child turned 18. In 2004 W filed a motion for cumulative c/s judgment in the 302nd District Court of Dallas County. This suit was dismissed for want of jurisdiction. In April 2005 W filed what she called an “amended” motion for cumulative money judgment. In 2008 W filed a motion to transfer to Bexar County for the convenience of the parties and witnesses and because H lived there and was unable to travel for health reasons. An agreed order transferring the case was signed and the case was transferred to the 407th District Court in Bexar County. After trial the court entered a cumulative money judgment in the amount of $237,249 for arrearages and interest. The judgment also awarded attorneys fees of $7000; appellate fees in the event of an unsuccessful appeal; and $6,000 in bankruptcy fees in the event H filed and W was forced to collect her judgment in bankruptcy court. MNT was denied and H appealed. H raised jurisdictional arguments based on his claim that only DR Court #2 had jurisdiction to transfer the case, however DR Court #2 became the 302nd District Court after the Family District Court Act was passed in 1977 and thus H’s first argument was denied. Next H argued that W’s right to obtain a cumulative judgment was barred by the limitations provisions in TFC 157.005(b) which became effective in June 2005.

    The COA determined that even though W called her pleading an "amended" pleading, there was no pending action to amend (having earlier been DWOP’d) and thus is was a new suit, filed before the effective date of the limitations statute which therefore did not apply. The former version of TFC 157.005(b) had no 10 year limitations period and thus, W’s suit was not barred. Next H contends that W’s claim is barred under the dormancy provisions found in CPRC 34.001 and 31.006. The COA noted that in 2009 these statutes were amended to provide that they were not applicable to child support judgments under the Family Code regardless of when those judgments were rendered and therefore did not apply in this case. Finally, H attacked the award of fees, specifically the $6,000 awarded in the event of a bankruptcy filing. H argued that this award was an attempt to preempt the jurisdiction of the bankruptcy court. The COA held that the Family Code specifically allows for the recover of fees in child support collection cases and that the award of potential bankruptcy fees was akin to the award of appellate fees conditioned on the outcome of the appeal. The bankruptcy fees were awarded "in the event H filed a bankruptcy petition." The COA held that because an award of fees was mandatory under TFC 157.167 and a conditional award of appellate fees is also recognized (TFC 6.709 & 109.001), there was no error in the additional award of bankruptcy fees in the event H filed.

    COMMENT: Wow! I recommend that everyone amend their enforcement pleading forms (or any form which seeks to recover remuneration of a type that a debtor might seek to discharge in bankruptcy) to include a request for “conditional bankruptcy fees” and plan to put on expert testimony in support of such a request at trial.

  6. White v. Perez, 2010 Tex. App. LEXIS 150 (Tex. App. – Fort Worth January 7, 2010) (mem. opinion) (Cause No. 02-09-251-CV)

    H sued W for divorce alleging a common law marriage. W served H with interrogatories seeking “all times, dates and places” where he alleged they agreed to be married and where they held out to others that they were married. H failed to respond and W’s attorney contacted H’s attorney to remind him the answers were due. Three days before trial and three months after they were originally due, H served unsigned answers to interrogatories on W. At trial, H attempted to offer evidence that would have been disclosed in the requested interrogatories and W objected. H did not attempt to show good cause for his failure to respond. The trial court sustained the objection and then granted a directed verdict for W that there was no common law marriage. On appeal, H argued that W waived her objection to the lack of answers because she did not file a pre-trial motion and obtain a ruling on the lack of answers and further that the sanction amounted to an inappropriate death penalty sanction without consideration of a lesser sanction.

    The COA held that TRCP 193.6 (party who fails to timely make, amend or supplement discovery may not introduce evidence not timely disclosed) is automatic and therefore no pre-trial motion for sanctions or motion to compel is required to trigger application. The only way to escape the sanction is to establish good cause. Further because application of the sanction is automatic, it is not reviewed under the TransAmerican death penalty standards. When there is no showing of good cause the court must exclude the evidence and imposition of lesser sanctions first is not required or permitted. Dismissal affirmed.

  7. In the Interest of T.A.N., 2010 Tex. App. LEXIS 123 (Tex. App. – Amarillo January 8, 2010) (mem. opinion) (Cause No. 07-08-483-CV)

    H and W divorced in 1991 and W was awarded primary custody of their 3 children. Shortly after divorce the youngest child, T, was diagnosed with a form of cancer in his leg. He had surgery to remove the cancer, chemo and surgery to encourage growth in his leg. He was making progress until age 11 when he had an accident at Walmart that set back his progress. Walmart settled the personal injury claim as follows: (1) lump sum payment of $478,000; (2) annuity paying $540/month increasing 3% annually; (3) eight payments of $10,000 at six month intervals; (4) after that, $12,000 every 5 years for the remainder of his life. The lump sum was used to pay attorneys fees and medical bills and to buy a house held in trust for T which would be deeded to him at age 18. Under the divorce decree, H paid child support until T reached 18 at which time he also terminated T’s health insurance coverage. W filed suit requesting that H be obligated to continue support and maintain insurance because of T’s disability. At trial, experts testified that T had fragile skin which would create lifelong problems, that he could not walk great distances without assistance, that the atrophy in his muscles prevented him from doing many things, that his overall ability to walk was limited because one leg was much shorter than the other and that the only work he could do was sedentary which he could not do for long periods. The experts expected between 3 and 10 future surgeries and that he would need significant assistance immediately following these surgeries. The also testified that he suffered from constant pain. The court concluded that T required substantial care and personal supervision because of his disability; that he was not capable of self-support and that his disability existed before age 18. The court ordered retroactive support for 9 months following T’s completion of his GED and ordered ongoing support of $300/month until T entered college at which time child support would increase to guideline support. H was also ordered to carry health insurance for as long as allowed and then if T acquired his own insurance, both H and W were each ordered to pay 1/3. H appealed arguing that there was no proof that T required continuous care because he was able to support himself for long periods between surgeries.

    The COA held that the proof must only establish that he required "substantial" not "continuous" care and found the evidence legally and factually sufficient to meet the requirements for ongoing support. Because the order contained no specific language as to the amount of support H was to pay once T enrolled in college, the court remanded this portion of the order back to the trial court to set a specific amount.

  8. Beltran v. Beltran, 2010 Tex. App. LEXIS 349 (Tex. App. – El Paso January 20, 2010) (Cause No. 08-08-0002-CV)

    H sued W for divorce in 2004 based on insupportability. In 2006 W amended her counter claim to allege breach of fiduciary duty, actual fraud, alter ego, fraudulent transfer and civil conspiracy against her H for his transfer of a 50% interest in the parties’ construction company to his brother (B). In response, B intervened in the divorce, denied the allegations and sought a declaratory judgment affirming B’s ownership in the company based on his claim that had H created a trust in 1986 to hold this interest until 1999 when B would receive title. Thereafter, H & W entered into an MSA which divided their property and resolved all issues regarding their children. The MSA provided that H would receive 100% ownership of various businesses including the construction company and W was divested of all rights in these entities. The trial court, finding that H had created such a trust, did not transfer the funds to his B in fraud of W’s rights and granted B’s declaratory judgment and found that this disposed of all of W’s counter claims based on fraud. The declaratory judgment order was signed in August. The court then signed a final decree in December. W appealed from the declaratory judgment. H filed a motion to dismiss the appeal arguing that W’s settlement of the divorce effectively rendered her appellate issues concerning the declaratory judgment moot.

    The COA agreed holding that when W agreed that H would be awarded 100% of the parties interest in the construction company, she no longer owned any interest in the property which was allegedly harmed and any decision by the court regarding the actions between H and W would be purely an advisory opinion which is not permitted.

  9. In the Interest of L.L. and T.L., Children, 2010 Tex. App. LEXIS 319 (Tex. App. – San Antonio January 20, 2010) (mem. opinion) (Cause No. 04-08-911-CV)

    H & W were divorced in 2002. H was awarded primary conservatorship. After the divorce, H was deployed with the military on three separate occasions. W remarried. The children alternated living with H and W during H”s deployments. In 2007, W filed a MTM seeking primary custody and claimed that H had voluntarily relinquished care of the children to her for at least 6 months. At the time of trial, the oldest child was 17 and signed a choice in favor of her father. The youngest child was 9 and had been living with W since 2004. After a 3 day trial the court named H primary custodian of the oldest child and named W primary custodian of the younger child. H filed a motion to reconsider which was denied. He also filed a MNT which was denied and the court awarded W fees of $1400. Thereafter W filed a motion for appellate fees. The hearing on this motion was held more than 30 days after H filed his notice of appeal and the court granted the motion, awarding W an additional $12,000. The order was signed more than 60 days after H filed his notice of appeal. H challenged the award of primary custody of the younger child based on his claim that the trial court was punishing him for his military service.

    The COA noted that while courts are precluded from exclusively reliance on military deployment to find a material and substantial change they are not prevented from considering it and in this case H failed to challenge any of the additional evidence offered to support modification including the child’s status quo with W and other evidence that he was doing fine in W’s care. Regarding fees, the court reversed the award of fees for the MNT hearing because W was the only witness to testify and such fees could not be awarded in the absence of expert testimony. The COA held the award of appellate fees void because the hearing was not held and the order was not signed during the 30 day period after the appeal was perfected which is the only time the trial court has jurisdiction to issue these orders.