Texas Causes of Action & Affirmative Defenses

Texas Causes of Action & Affirmative Defenses

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Saturday, May 19, 2012

When is turnover relief warranted to enforce a money judgment?

  
REQUIREMENTS FOR GRANT OF TURNOVER ORDER
  
A turnover order is proper if the conditions of section 31.002 of the Texas Civil Practice and Remedies Code are met. See Suttles v. Vestin Realty Mortg. I, Inc., 317 S.W.3d 412, 416 (Tex. App.-Houston [1st Dist.] 2010, no pet.). Among the requirements of section 31.002 is that the creditor must show that the debtor owns property, including present or future rights to property, that cannot readily be attached or levied on by ordinary legal process. See Tex. Civ. Prac. & Rem. Code Ann. § 31.002(a) (West 2012); see also Europa Int'l, Ltd. v. Direct Access Trader Corp., 315 S.W.3d 654, 656-57 (Tex. App.-Dallas 2010, no pet.).
  
SOURCE: DALLAS COURT OF APPEALS - 05-10-01161-CV – 5/16/12 

In this case, Barclay presented no evidence to show that HSM had any present or future rights to the property it sought to have turned over.
 

As stated above, Barclay submitted no evidence in support of the application other than the judgment it was seeking to enforce and the order on HSM's motion to disregard.
 
Barclay contends the trial court had the discretion to consider all the evidence before it at the hearing including the evidence submitted in support of the motion for sanctions heard at the same time.
  
This argument is not well taken for two reasons. First, the trial court stated in its turnover order that its review was limited to Barclay's application for a turnover order and the arguments of counsel. The application for turnover order and the arguments of counsel are not evidence upon which the trial court could have based its order. See McCain v. NME Hospitals, Inc., 856 S.W.2d 751, 757 (Tex. App.-Dallas 1993, no writ); Delgado v. Kitzman, 793 S.W.2d 332, 333 (Tex. App.-Houston [1st Dist.] 1990, no writ).
 
Second, even though Barclay's motion for sanctions was heard at the same time as its request for a turnover order, the trial court did not reach the merits of the motion for sanctions, but instead resolved the matter on jurisdictional grounds. Accordingly, the trial court had no reason to consider the evidence submitted in support of the sanctions motion.
  
Barclay also points to its application for a post-judgment writ of garnishment and the attached evidence that was filed the same day as the application for a turnover order. Although the two pleadings were filed the same day, the application for a writ of garnishment was filed as a separate civil action with a different cause number. There is no
indication any of the evidence in that case was before the trial court in this case.
   
Finally, Barclay relies on a transcript from a bankruptcy court proceeding to support the turnover order. The notice of filing attached to the bankruptcy court transcript indicates it was not filed with the trial court in this case until March 22, 2011, well after the order at issue was signed. The trial court, therefore, could not have had the  transcript before it at the time of its ruling.Because there is no indication the trial court was presented with or considered any evidence to support the requirements of section 31.002 of the Texas Civil Practice and Remedies Code when it made its ruling, we conclude the trial court abused its discretion in granting the turnover order.
  
Given this conclusion, it is unnecessary for us to consider the remainder of HSM's arguments. We vacate the August 31, 2010 turnover order and remand the cause to the trial court.
 
SOURCE: DALLAS COURT OF APPEALS - 05-10-01161-CV – 5/16/12 


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