Declaratory Judgments Action - When is it proper?

SUIT FOR DECLARATORY JUDGMENT IN TEXAS 

A declaratory judgment is a remedial measure that determines the rights of the parties and affords relief from uncertainty with respect to rights, status, and legal relations. See Halliburton Energy Servs., Inc. v. Axis Tech., LLC, 444 S.W.3d 251, 262 (Tex. App.-Dallas 2014, no pet.) (citing Ysasaga v. Nationwide Mut. Ins. Co., 279 S.W.3d 858, 863 (Tex. App.-Dallas 2009, pet. denied)). The Texas Uniform Declaratory Judgments Act is contained in chapter 37 of the Texas Practice and Remedies Code. See TEX. CIV. PRAC. & REM. CODE ANN. §§ 37.001-37.011.

Under section 37.004(a) of the declaratory judgments act, "[a] person interested under a deed . . . may have determined any question of construction or validity arising under the instrument . . . and obtain a declaration of rights, status, or other legal relations thereunder." Id. § 37.004(a). Further, the act provides in part, "[n]otwithstanding Section 22.001, Property Code, a person described by Subsection (a) may obtain a determination under this chapter when the sole issue concerning title to real property is the determination of the proper boundary line between adjoining properties." Id. § 37.004(c). Additionally, section 37.009 of the act states, "In any proceeding under this chapter, the court may award costs and reasonable and necessary attorney's fees as are equitable and just." Id. § 37.009.

Section 16.033 of the Texas Civil Practice and Remedies Code provides in part,

A person with a right of action for the recovery of real property or an interest in real property conveyed by an instrument with one of the following defects must bring suit not later than two years after the day the instrument was filed for record with the county clerk of the county where the real property is located:

. . . .
(6) acknowledgment of the instrument in an individual, rather than a representative or official, capacity;
(7) execution of the instrument by a trustee without record of the authority of the trustee or proof of the facts recited in the instrument;
(8) failure of the record or instrument to show an acknowledgment or jurat that complies with applicable law; or
(9) wording of the stated consideration that may or might create an implied lien in favor of the grantor.

Id. § 16.033(a) (West 2002). Section 16.003 does not apply to a forged instrument. Id. § 16.033(b).

A bona fide purchaser is "[a] person who acquires property in good faith, for value, and without notice of any third-party claim or interest." Fletcher v. Minton, 217 S.W.3d 755, 758 (Tex. App.-Dallas 2007, no pet.); see also TEX. PROP. CODE ANN. § 13.001 (West 2014). Status as a bona fide purchaser is an affirmative defense to a title dispute. Madison v. Gordon, 39 S.W.3d 604, 606 (Tex. 2001). However, the protection usually afforded to a bona fide purchaser for value without notice does not apply when such purchaser's claim is dependent upon a forged instrument. Bellaire Kirkpatrick Joint Venture v. Loots, 826 S.W.2d 205, 210 (Tex. App.-Fort Worth 1992, writ denied).
 
SOURCE: DALLAS COURT OF APPEALS - No. 05-13-01581-CV - 1/21/2015

Declarations as a form of judicial relief (under the DJA)

Declaratory relief under the DJA (Declaratory Judgments Act)
   

CLAIMS UNDER THE TEXAS VERSION OF THE UNIFORM DECLARATORY JUDGMENTS ACT (UDJA)

Under the declaratory judgment act, "[a] person interested under a . . . written contract. . . may have determined any question of construction or validity arising under the . . . contract . . . and obtain a declaration of rights, status, or other legal relations thereunder." See Tex. Civ. Prac. & Rem. Code Ann. § 37.004 (West 2008). 

A declaratory-judgment proceeding is "an additional remedy and does not supplant any existing remedy, but is intended as a speedy and effective remedy for the determination of the rights of the parties when a real controversy has arisen." Cobb v. Harrington, 144 Tex. 360, 190 S.W.2d 709, 713 (Tex. 1945). A declaratory-judgment action "is appropriate when a justiciable controversy exists as to the rights and status of the parties and the controversy will be resolved by the declaration sought." Texas Health Care v. Seton Health Plan, Inc., 94 S.W.3d 841, 846 (Tex. App.-Austin 2002, pet. denied). 
  
A declaratory-judgment action may not be used to obtain an advisory opinion. Transportation Ins. Co. v. WH Cleaners, Inc., 372 S.W.3d 223, 227 (Tex. App.-Dallas 2012, no pet.) (explaining that declaratory-judgment action is proper only when justiciable controversy exists). In other words, the declaratory-judgment statute does not empower courts to comment on "hypothetical or contingent situations, or to determine questions not then essential to the decision of an actual controversy." Texas Health Care, 94 S.W.3d at 846.

SOURCE: AUSTIN COURT OF APPEALS - 03-10-00784-CV - 01/4/2013

Litigating contracts: declaratory judgment vs. contract damages and enforcement

DECLARATORY JUDGMENT INDEPENDENT OF
DAMAGES CAUSED BY BREACH OF CONTRACTUAL OBLIGATION.

 

Different types of lawsuits may be brought relating to a contract. A suit seeking damages for breach is not the only variety.  

"A person interested under a . . . written contract. . . may have determined any question of construction or validity arising under the . . . contract . . . and obtain a declaration of rights, status, or other legal relations thereunder." TEX. CIV. PRAC. & REM. CODE ANN. § 37.004(a) (Vernon 2008). "A contract may be construed either before or after there has been a breach." Id. § 37.004(b).

Accordingly, a person can bring a declaratory judgment action following a breach of contract and have the rights under the contract declared. While such an action has much in common with a breach of contract action, they are distinct from each other. Specifically, a declaratory judgment action has the effect of determining liability without awarding damages, while a breach of contract action seeks both a determination of liability and an award of damages. See Intercontinental Group P'ship v. K.B. Home Lone Star, L.P., 295 S.W.3d 650, 660-61 (Tex. 2009).

"Further relief based on a declaratory judgment or decree may be granted whenever necessary or proper." TEX. CIV. PRAC. & REM. CODE ANN. § 37.011 (emphasis added). "Necessary or proper" is disjunctive, not conjunctive. Additionally, the further relief available is not limited only to actions necessary to enforce the judgment. Instead, further relief is available for anything that "serve[s] to effectuate the underlying judgment." State v. Anderson Courier Service, 222 S.W.3d 62, 65 (Tex. App.-Austin 2005, pet. denied).

When a case is remanded for further proceedings, res judicata does not apply at all because there is no second action. Jay Petroleum, L.L.C. v. EOG Resources, Inc., 332 S.W.3d 534, 540 (Tex. App.-Houston [1st Dist.] 2009, pet. denied). Further relief sought under section 37.011 is not limited to claims brought in the same cause. Valley Oil, 499 S.W.2d at 336. Instead, it "may be sought in the same proceeding or in a later proceeding." Lakeside Realty, 202 S.W.3d at 191.

SOURCE: HOUSTON COURT OF APPEALS – No. 01-11-00650-CV – 1/24/2013 – CBS Outdoor, Inc. v. Potter  

 

Does a prior declaratory judgment action entail res judicata effect?

   
Here is a scenario where the difference between claim and issue preclusion becomes meaningful: a prior suit of declaratory relief, and a second suit seek other type of relief.
  

DECLARATORY JUDGMENT AND RES JUDICATA: THE EXCEPTION
   

The elements for establishing res judicata, or claim preclusion, are "(1) a prior final judgment on the merits by a court of competent jurisdiction; (2) identity of parties or those in privity with them; and (3) a second action based on the same claims as were raised or could have been raised in the first action." Amstadt v. U.S. Brass Corp., 919 S.W.2d 644, 652 (Tex. 1996).

An exception to the application of res judicata is when the original suit sought only a declaratory judgment. See Valley Oil Co. v. City of Garland, 499 S.W.2d 333, 335 (Tex. Civ. App.-Dallas 1973, writ ref'd n.r.e.). In this situation, the first judgment provides only declaratory relief and does not bar a subsequent proceeding for coercive relief stemming from the declaratory judgment. See id.; TEX. CIV. PRAC. & REM. CODE ANN. § 37.011 (Vernon 2008) (providing "[f]urther relief based on a declaratory judgment or decree may be granted whenever necessary or proper").

The rationale for this apparent departure from the usual rule of res judicata is that the losing party in a declaratory judgment action can normally be expected to recognize the rights declared by the judgment and act accordingly, but that if he fails to do so, the court should have ample power to enforce the judgment by subsequent coercive orders, whether or not such relief was sought in the original action.

Valley Oil, 499 S.W.2d at 336.

Under this exception, the only matters excluded from subsequent litigation are what was actually considered and ruled on in the original action. See Alsheikh v. Arabian Nat'l Shipping Corp., 01-08-00007-CV, 2009 WL 884795, at *2 (Tex. App.-Houston [1st Dist.] 2009, no pet.) (mem. op.). In other words, while issue preclusion (collateral estoppel) applies to prior declaratory judgment actions, claim preclusion (res judicata) does not. See id.; Barr v. Resolution Trust Corp. ex rel. Sunbelt Fed. Sav., 837 S.W.2d 627, 628 (Tex. 1992) (distinguishing between issue preclusion and claim preclusion and defining issue preclusion as preventing relitigation of particular issues already resolved in prior suit).

SOURCE: HOUSTON COURT OF APPEALS – No. 01-11-00650-CV – 1/24/2013 – CBS Outdoor, Inc. v. Potter
 

SNIPPET FROM EARLIER CASE FROM HOUSTON ADDRESSING THE SAME ISSUE:

The doctrine of res judicata bars a second suit by parties on matters actually litigated in an earlier suit, as well as claims "`which, through the exercise of diligence, could have been litigated in a prior suit.'" Getty Oil Co. v. Ins. Co. of N. Am., 845 S.W.2d 794, 799 (Tex.1992) (quoting Barr v. Resolution Trust Corp., 837 S.W.2d 627, 631 (Tex.1992)). Texas follows the transactional approach to res judicata, which requires claims arising out of the same subject matter to be litigated in a single lawsuit. Hallco Tex., Inc. v. McMullen County, 221 S.W.3d 50, 58 (Tex. 2006); Barr, 837 S.W.2d at 631. For res judicata to apply, there must be: (1) a prior final judgment on the merits by a court of competent jurisdiction; (2) identity of parties or those in privity with them; and (3) a second action based on the same claims that were raised or could have been raised in the first action. Amstadt v. U.S. Brass Corp., 919 S.W.2d 644, 652 (Tex. 1996).

Here, the third element of res judicata is not met because there is no second action concerning these claims. The reversal of Jay's motion for summary judgment made the counterclaims live again, which does not constitute res judicata because the matter of attorney's fees was never finally determined. See Tex. Water Rights Comm'n v. Crow Iron Works, 582 S.W.2d 768, 771 (Tex.1979) (stating res judicata requires cause "finally determined, without appeal").

We also note that when we rendered the declaratory judgment in favor of EOG, EOG could seek a subsequent application for relief based on rights declared in the prior judgment, "even though such relief could have been granted in the original action," unless such application was actually considered and denied in the original action. State v. Anderson Courier Serv., 222 S.W.3d 62, 66 (Tex.App.-Austin 2005, pet. denied); Valley Oil Co. v. City of Garland, 499 S.W.2d 333, 335 (Tex.Civ. App-Dallas 1973, no writ). As our sister court explained,

[T]he rationale for this apparent departure from the usual rule of res judicata is that the losing party in a declaratory judgment action can normally be expected to recognize the rights declared by the judgment and act accordingly, but that if he fails to do so, the court should have ample power to enforce the judgment by subsequent coercive orders, whether or not such relief was sought in the original action.

Valley Oil Co., 499 S.W.2d at 336; see also 3 William V. Dorsaneo III, Texas Litigation Guide § 45.03 (2008) ("After a party has obtained a declaratory judgment, a subsequent suit may be brought for further relief if it is necessary or proper. [Citation omitted.] This rule involves a departure from the strict application of res judicata, which would ordinarily bar a subsequent proceeding because coercive relief could have been granted in the original action. It is justified on the theory that the loser may be expected to recognize the rights declared by the judgment, and if not, some form of compulsion should be available."). Because the trial court never had the opportunity to consider EOG's request for attorney's fees following our declaratory judgment in favor of EOG, EOG could not be barred by res judicata to pursue that claim for relief based on rights declared by our judgment.

We hold EOG's counterclaim for attorney's fees is not barred by res judicata. We overrule Jay's second issue.

SOURCE:  Jay Petroleum, L.L.C. v. EOG Resources, Inc., 332 S.W.3d 534, 539 (Tex. App.-Houston [1st Dist.] 2009, pet. denied);

 

Availability of declaratory relief under the Texas version of the UDJA

   
When is declaratory relief available under the Declaratory Judgments Act (DJA), when not? 
  
UDJA CLAIM FOR DECLARATORY JUDGMENT
   
A person interested under a deed, will, written contract, or other writings constituting a contract or whose rights, status, or other legal relations are affected by a statute, municipal ordinance, contract, or franchise may have determined any question of construction or validity arising under the instrument, statute, or ordinance, contract or franchise and obtain a declaration of rights, status, or other legal relations thereunder. Tex. Civ. Prac. & Rem. Code Ann. § 37.004(a) (West 2008).
   
The purpose of the Declaratory Judgments Act is "to settle and afford relief from uncertainty and insecurity with respect to rights, status, and other legal relations." Tex. Civ. Prac. & Rem.Code Ann. § 37.002(b) (West 2008). It is "remedial" and "is to be liberally construed." Id.
  
The Declaratory Judgments Act cannot be used to obtain an advisory opinion, which Texas courts lack subject-matter jurisdiction to give. Tex. Ass'n of Bus. v. Tex. Air Control Bd., 852 S.W.2d 440, 444 (Tex.1993).
 
Declaratory judgment is appropriate only when a real controversy exists between the parties and the entire controversy may be determined by the judicial declaration. Brooks v. Northglen Ass'n, 141 S.W.3d 158, 163-64 (Tex. 2004); OAIC Commercial Assets, L.L.C. v. Stonegate Village, L.P., 234 S.W.3d 726, 745 (Tex. App.-Dallas 2007, pet. denied). The Act does not give a litigant the right to try a case piecemeal. United Servs. Life Ins. Co. v. Delaney, 396 S.W.2d 855, 858 (Tex. 1965); SW Airlines Co. v. Tex. High-Speed Rail Auth., 863 S.W.2d 123, 125 (Tex. App.-Austin 1993, writ denied).
    
Ripeness is a requirement of justiciability. Perry v. Del Rio, 66 S.W.3d 239, 249 (Tex. 2001); Patterson v. Planned Parenthood of Houston & Se. Tex., Inc., 971 S.W.2d 439, 442 (Tex. 1998). The ripeness doctrine conserves judicial time and resources for real and current controversies, rather than abstract, hypothetical, or remote disputes. Mayhew v. Town of Sunnyvale, 964 S.W.2d 922, 928 (Tex. 1998); TCI West End, Inc. v. City of Dallas, 274 S.W.3d 913, 918 (Tex. App.-Dallas 2008, no pet.). The doctrine prohibits suits involving "uncertain or contingent future events that may not occur as anticipated, or indeed may not occur at all." Patterson, 971 S.W.3d at 442. A case is not ripe if its resolution depends on contingent facts or upon events that have yet to come to pass. See id. at 443.
   
A defendant may not use a declaratory judgment to prematurely adjudicate defenses to liability that may not yet exist. Cf. Calderon v. Ashmus, 523 U.S. 740 (1998) (under federal constitution, party may not use a declaratory judgment to get advance ruling on an affirmative defense); see also Cohen v. Orthalliance New Image, Inc., 252 F. Supp.2d 761, 766 (N.D. Ind. 2003) (assessing the success of a defense to a potential claim (breach-of-contract or otherwise) is generally the type of hypothetical question federal courts endeavor to avoid).
  
SOURCE: DALLAS COURT OF APPEAL - 05-10-00655-CV - 10/19/11

JUSTICIABILITY REQUIREMENT MUST BE MET

A declaratory judgment is appropriate only if a justiciable controversy exists as to the rights and status of the parties and the controversy will be resolved by the declaration sought. Bonham State Bank v. Beadle, 907 S.W.2d 465, 467 (Tex. 1995) (citing Tex. Ass'n of Bus. v. Tex. Air Control Bd., 852 S.W.2d 440, 446 (Tex. 1993)). "To constitute a justiciable controversy, there must exist a real and substantial controversy involving genuine conflict of tangible interests and not merely a theoretical dispute" Id. If declaratory relief will not terminate a controversy between parties and would be irrelevant at the time judgment is rendered, a declaratory judgment will amount to no more than an advisory opinion, which the trial court lacks power to provide. Kenneth Leventhal & Co. v. Reeves, 978 S.W.2d 253, 259 (Tex. App.—Houston [14th Dist.] 1998, no pet.).

SOURCE: CORPUS CHRISTI / EDINBURG COURT OF APPEALS - 13-11-003-CV - 10/6/11   

UDJA Fees when the case becomes moot

Statutory Legal Fees under the Texas version of the UDJA Attorneys' fees under the Declaratory Judgments Act [UDJA or DJA], chapter 37 of the Texas Civil Practice and Remedies Code. The Act provides, “In any proceeding under this chapter, the court may award costs and reasonable and necessary attorney's fees as are equitable and just.” Tex. Civ. Prac. & Rem. Code Ann. § 37.009 (West 2008). A party to a declaratory-judgment action need not prevail in order to recover an award of attorneys' fees. Martin v. Cadle Co., 133 S.W.3d 897, 906-07 (Tex. App.-Dallas 2004, pet. denied); accord City of Temple v. Taylor, 268 S.W.3d 852, 858 (Tex. App.-Austin 2008, pet. denied). Mootness Doctrine “A case becomes moot if a controversy ceases to exist or the parties lack a legally cognizable interest in the outcome.” Allstate Ins. Co. v. Hallman, 159 S.W.3d 640, 642 (Tex. 2005). “A case is not rendered moot simply because some of the issues become moot . . . .” In re Kellogg Brown & Root, Inc., 166 S.W.3d 732, 737 (Tex. 2005) (orig. proceeding). “The mootness doctrine implicates subject matter jurisdiction.” City of Dallas v. Woodfield, 305 S.W.3d 412, 416 (Tex. App.-Dallas 2010, no pet.). “[W]hen a case becomes moot the only proper judgment is one dismissing the cause.” Polk v. Davidson, 196 S.W.2d 632, 633 (Tex. 1946); see also Woodfield, 305 S.W.3d at 416 (“If a case is moot, the appellate court is required to vacate any judgment or order in the trial court and dismiss the case.”). Texas Supreme Court authorities on fees and mootness The Texas Supreme Court has decided three cases that address the question of whether an outstanding claim for attorneys' fees will prevent the dismissal of an otherwise moot case. The first is Camarena v. Texas Employment Commission, 754 S.W.2d 149 (Tex. 1988). Camarena and others sued the Commission, seeking a declaratory judgment that a statute excluding most agricultural workers from the Texas Unemployment Compensation Act was unconstitutional. Id. at 150. The trial court granted Camarena the declaration he sought, but it denied his request for attorneys' fees based on sovereign immunity. Id. The legislature amended the statute to give farm workers phased- in unemployment coverage, and the trial court rendered an amended judgment holding the new statute constitutional. Id. The Commission appealed, contending that the case had become moot, and Camarena cross-appealed the denial of attorneys' fees. Id. The court of appeals held that the case was moot and that immunity barred Camarena's claim for fees. Id. at 150-51. The Texas Supreme Court, however, held that the claim for attorneys' fees was a live claim that prevented the case from becoming moot. Id. at 151. It further held that the fee claim was not barred because chapter 106 of the civil practice and remedies code waived sovereign immunity. Id. at 151-52. Thus, Camarena supports the proposition that a claim for attorneys' fees can prevent a case from becoming moot. Next, the supreme court decided Speer v. Presbyterian Children's Home & Service Agency, 847 S.W.2d 227 (Tex. 1993), a case heavily relied on by the Hansens in this appeal. In Speer, Speer sued the Agency under the Texas Commission on Human Rights Act for refusing to hire her as an adoption worker because of her religion. Id. at 228. She sought only declaratory and injunctive relief. Id. The trial court ruled for the Agency, this Court affirmed, and Speer appealed to the Texas Supreme Court. Id. While the case was pending in the supreme court, the Agency ceased offering adoption services and abolished the position for which Speer had applied. Id. The supreme court held that the case was therefore moot and had to be dismissed. Id. at 230. The court distinguished Camarena, holding that because Speer's declaratory and injunction claims had become moot, she could never be a prevailing party under the Texas Commission on Human Rights Act and therefore could never recover her attorneys' fees and costs. Id. at 229-30. The El Paso Court of Appeals subsequently elaborated on the distinction between Camarena and Speer. Citing Camarena, the court of appeals held that a claim for attorneys' fees can keep a declaratory-judgment case alive despite substantive mootness because a party does not have to prevail in order to recover its attorneys' fees under the Declaratory Judgments Act. Labrado v. Cnty. of El Paso, 132 S.W.3d 581, 589-91 (Tex. App.-El Paso 2004, no pet.). Speer was distinguishable because Speer sued under the Texas Commission on Human Rights Act, which required her to prevail in order to recover her attorneys' fees. Id. at 590. Because the mootness of her substantive TCHRA claim meant she could never prevail, a claim for fees could not keep her claim alive. Id. at 590-91. Finally, in the Allstate Insurance Co. case, the supreme court reaffirmed that a dispute over attorneys' fees under the Declaratory Judgments Act is a “live controversy” even if the substance of the case becomes moot during its pendency. Allstate Ins. Co. v. Hallman, 159 S.W.3d 640, 642 (Tex. 2005). In that case, Hallman was sued for property damage. Id. at 641. Her liability insurer, Allstate, provided her with a defense under a reservation of rights but commenced a declaratory- judgment action against Hallman contesting coverage of the property-damage claim. Id. The trial court granted summary judgment for Allstate and denied both sides their attorneys' fees, but this Court reversed, held that the claim was covered, and remanded for consideration of Hallman's claim for attorneys' fees. Id. at 642. While the case was on further appeal to the Texas Supreme Court, Hallman won the underlying property-damage case, and Allstate disclaimed any intention of seeking to recoup from Hallman its costs of defending the underlying case. Id. The supreme court cited Camarena and held that Hallman's continuing claim for attorneys' fees kept the case from becoming moot. Id. at 643 (“Hallman's remaining interest in obtaining attorney's fees 'breathes life' into this appeal and prevents it from being moot.”). Accordingly, the court proceeded to decide the merits of the coverage question because of the live attorneys' fees issue. Id. at 643-45. Thus, Allstate Insurance Co. confirms that a claim for attorneys' fees under the Declaratory Judgments Act will keep a case alive even if the request for substantive declaratory relief becomes moot. SOURCE: Dallas Court of Appeals - 05-09-01001-CV - 6/13/11 We conclude that Camarena and Allstate Insurance Co. stand for the proposition that a case under the Declaratory Judgments Act remains a live controversy, even if all requests for substantive declaratory relief become moot during the action's pendency, as long as a claim for attorneys' fees under the Act remains pending. See Tex. Dep't of Transp. v. Tex. Weekly Advocate, No. 03-09- 00159-CV, 2010 WL 323075, at *3 (Tex. App.-Austin Jan. 29, 2010, no pet.) (mem. op.) (“An appeal from the grant or denial of attorney's fees, at least with respect to a UDJA claim, is usually a separate controversy and can persist even when the underlying controversy is moot.”) (emphasis added) (citing Allstate Insurance Co. and Camarena in support). Thus, Chase's and Cramer's claims for attorneys' fees under the Declaratory Judgments Act kept this case from becoming moot even though the Hansens dropped their objection to the sale of the house and the house was actually sold. Speer does not apply to cases under the Declaratory Judgments Act, and the Hansens' reliance on Speer is thus misplaced. In support of their mootness argument, the Hansens also rely on cases such as MBM Financial Corp. v. Woodlands Operating Co., L.P., 292 S.W.3d 660 (Tex. 2009), and City of Carrollton v. RIHR Inc., 308 S.W.3d 444 (Tex. App.-Dallas 2010, pet. denied). These cases are not on point. In each case, the appellate court concluded that a party could not use the Declaratory Judgments Act as a vehicle for recovering attorneys' fees when the declaratory-judgment claims merely duplicated other claims already before the trial court. See MBM Fin. Corp., 292 S.W.3d at 669-71; RIHR Inc., 308 S.W.3d at 454-55. The instant case, by contrast, was an action solely for declaratory judgment, so Chase's declaratory-judgment claims were not duplicative of any other claims. Accordingly, MBM Financial Corp. and similar cases are distinguishable. The Hansens also rely on two other cases that predate Allstate Insurance Co. These cases are not persuasive. In Ware v. Miller, the Amarillo Court of Appeals held that a plaintiff's claim for declaratory judgment “was rendered moot” during its pendency, and it therefore vacated the trial court's judgment (which awarded the plaintiff his attorneys' fees) and dismissed the appeal. 134 S.W.3d 381, 384-85 (Tex. App.-Amarillo 2003, pet. denied). It appears that the Ware court did not consider the possibility that the plaintiff's claim for fees under the Declaratory Judgments Act might have prevented the case from becoming moot. See id. In Kenneth Leventhal & Co. v. Reeves, Reeves sued the defendants for breach of contract and declaratory judgment, and he obtained a judgment awarding him no relief except for attorneys' fees. 978 S.W.2d 253, 256-57 (Tex. App.-Houston [14th Dist.] 1998, no pet.). The court of appeals reversed and rendered a take- nothing judgment against Reeves, holding that the judgment for fees could not be sustained under the Declaratory Judgments Act for two reasons. Id. at 258-60. First, Reeves's claim for declaratory judgment was duplicative of his claim for breach of contract, and so it could not enable him to recover fees that were otherwise not recoverable. Id. at 258-59. We agree with this reasoning. Second, the court concluded that Reeves's claim for declaratory relief had become moot during its pendency and therefore would not support an award of attorneys' fees to either side. Id. at 259-60. This reasoning is contrary to Allstate Insurance Co., which is binding on us, and so we decline to follow Reeves. Neither side cited our recent opinion in City of Richardson v. Gordon, 316 S.W.3d 758 (Tex. App.-Dallas 2010, no pet.). In Gordon, we addressed a fact-specific issue concerning attorneys' fees in relation to the Declaratory Judgments Act and governmental immunity. We conclude that Gordon is limited to its facts and should not be construed beyond its application to the discrete facts of that case. SOURCE: Dallas Court of Appeals - 05-09-01001-CV - 6/13/11

Texas DJA: When is declaratory judgment an appropriate remedy?

CLAIM FOR DECLARATORY JUDGMENT UNDER THE TEXAS VERSION OF THE UNIFORM DECLARATORY JUDGMENTS ACT (UDJA, Texas DJA, TDJA)

Under what circumstances is it available?

A declaratory judgment is appropriate only if a justiciable controversy exists concerning the rights and status of the parties and the controversy will be resolved by the declaration sought. Bonham State Bank v. Beadle, 907 S.W.2d 465, 467 (Tex. 1995) (citing Tex. Ass’n of Bus. v. Tex. Air Control Bd., 852 S.W.2d 440, 446 (Tex. 1993)). “To constitute a justiciable controversy, there must exist a real and substantial controversy involving genuine conflict of tangible interests and not merely a theoretical dispute.” Id. If declaratory relief will not terminate a controversy between parties and would be irrelevant at the time judgment is rendered, a declaratory judgment will amount to no more than an advisory opinion, which the trial court lacks power to provide. Kenneth Leventhal & Co. v. Reeves, 978 S.W.2d 253, 259 (Tex. App.—Houston [14th Dist.] 1998, no pet.).

SOURCE: Houston Court of Appeals (Beaumont caselaw b/c of transfer) - 14-08-00329-CV - 5/26/11

Attorney's Fees in Breach-of-Contract Action

Texas follows "the American Rule" Attorneys’ fees are not recoverable in Texas unless allowed by statute or the parties’ contract. Chapa, 212 S.W.3d at 310–11; Dallas Cent. Appraisal Dist. v. Seven Inv. Co., 835 S.W.2d 75, 77 (Tex. 1992). ATTORNEY'S FEES UNDER CHAPTER 38 OF THE CPRC: Prevailing plaintiffs only A party “may recover reasonable attorney’s fees from an individual or corporation, in addition to the amount of a valid claim and costs, if the claim is for . . . an oral or written contract.” Tex. Civ. Prac. & Rem. Code Ann. § 38.001(8). Our court has held that a “valid claim” under this statute is not limited to an action for monetary damages and may include an action for specific performance. See Rasmusson v. LBC PetroUnited, Inc., 124 S.W.3d 283, 287 (Tex. App.—Houston [14th Dist.] 2003, pet. denied) (citing Jones v. Kelley, 614 S.W.2d 95, 96, 100–01 (Tex. 1981)). No fees for successful defense of BoC claim under Chapter 38 [but that may change as a result of latest installment of legislative "tort" reform;---> Loser pays bill] Section 38.001(8) does not authorize recovery of attorneys’ fees for successfully defending a contract claim. See Tex. Civ. Prac. & Rem. Code Ann. § 38.001(8); Thottumkal v. McDougal, 251 S.W.3d 715, 719 (Tex. App.—Houston [14th Dist.] 2008, pet. denied). Prevailing defendant may recover fees if contractually authorized However, the above-quoted contractual provision entitling a “prevailing party” to recover attorneys’ fees does not distinguish between successful prosecution and successful defense of a claim. Therefore, we may uphold the trial court’s determination that [ litigant ] is entitled to some fees because it successfully defended [ opposing party's ] breach-of-contract counterclaim. SOURCE: Houston Court of Appeals (Beaumont caselaw b/c of transfer) - 14-08-00329-CV - 5/26/11 ATTORNEYS FEES UNDER THE DJA: The Texas Declaratory Judgment Act ("the ACT') [TDJA aka DJA] provides, “In any proceeding under this chapter, the court may award costs and reasonable and necessary attorney’s fees as are equitable and just.” Tex. Civ. Prac. & Rem. Ann. § 37.009 (West 2008). “The [Act] entrusts attorney fee awards to the trial court’s sound discretion, subject to the requirements that any fees awarded be reasonable and necessary, which are matters of fact, and to the additional requirements that fees be equitable and just, which are matters of law.” Bocquet v. Herring, 972 S.W.2d 19, 21 (Tex. 1998). SOURCE: Houston Court of Appeals (Beaumont caselaw b/c of transfer) - 14-08-00329-CV - 5/26/11

When attorney's fees are not available under the UDJA (Texas Declaratory Judgments Act)

   
No Statutory Attorney's Fees under the Declaratory Judgments Act (DJA) in the absence of proper declaratory judgment claim independent of other cause of action 
   
A party cannot use the Uniform Declaratory Judgments Act to obtain an otherwise impermissible attorney's fee. MBM Fin. Corp. v. Woodlands Operating Co., 292 S.W.3d 660, 669 (Tex. 2009). It is an abuse of discretion to award attorney's fees under the Uniform Declaratory Judgments Act when the statute is relied upon solely as a vehicle to recover attorney's fees. Tex. State Bd. of Plumbing Exam'rs v. Assoc. Plumbing-Heating-Cooling Contractors of Tex., Inc., 31 S.W.3d 750, 753 (Tex. App.-Austin 2000, pet. dism'd); see also City of Houston v. Texan Land & Cattle Co., 138 S.W.3d 382, 392 (Tex. App.-Houston [14th Dist.] 2004, no pet.) (party may not use declaratory judgment action to seek same relief afforded under another of its causes of action to obtain otherwise impermissible attorney's fees). In a declaratory judgment action, a “court may award costs and reasonable and necessary attorney's fees as are equitable and just.” Id. at § 37.009.

SOURCE: 05-08-01715-CV (Dallas Court of Appeals) (3/18/10)

Declaratory Judgment under the Texas UDJA (DJA)

   

DECLARATORY RELIEF UNDER THE DECLARATORY JUDGMENTS ACT (DJA)

   

The Declaratory Judgments Act is a procedural device for deciding cases that are within the trial court's jurisdiction. State v. Morales, 869 S.W.2d 941, 947 (Tex. 1994). The stated purpose of the Act is "to settle and to afford relief from uncertainty and insecurity with respect to rights, status, and other legal relations." Tex.Civ.Prac.&Rem.Code Ann. § 37.002(b)(Vernon 2008); Bonham State Bank v. Beadle, 907 S.W.2d 465, 467 (Tex. 1995).
   
UNDER WHAT CIRCUMSTANCES IS DECLARATORY RELIEF WARRANTED?
 
A declaratory judgment is appropriate only where there is a justiciable controversy about the rights and status of the parties and the declaration will resolve the controversy. Bonham State Bank, 907 S.W.2d at 467.
 
To constitute a justiciable controversy, there must exist a real and substantial controversy involving genuine conflict of tangible interests and not merely a theoretical dispute. Id. The Act does not empower courts to issue advisory opinions. Brooks v. Northglen Association, 141 S.W.3d 158, 164 (Tex. 2004).

   

ATTORNEY'S FEES AVAILABLE TO WINNER OR LOSER IN DECLARATORY JUDGMENT ACTION

 
In any proceeding under this chapter, the court may award costs and reasonable and necessary attorney's fees as are equitable and just.
Tex.Civ.Prac.&Rem.Code Ann. § 37.009.
 
In a declaratory judgment action, the decision to grant or deny attorney's fees is solely within the discretion of the trial court. Neeley v. West Orange-Cove Consolidated Independent School District, 176 S.W.3d 746, 799 (Tex. 2005).
 
Under Section 37.009, a trial court may exercise its discretion to award attorney's fees to either the prevailing or the nonprevailing party. See Barshop v. Medina County Underground Water Conservation District, 925 S.W.2d 618, 637-38 (Tex. 1996). The requirements that fees be reasonable and necessary are matters of fact, while the requirements that fees be equitable and just are matters of law. Bocquet v. Herring, 972 S.W.2d 19, 21 (Tex. 1998).

   

SOURCE: 08-07-00074-CV (El Paso Court of Appeals) (10/28/09)