Limitations period for defamation & single publication rule as to web-published material

LIMITATIONS PERIOD FOR DEFAMATION & SINGLE PUBLICATION RULE WHEN COMPLAINED-OF MATERIAL IS POSTED ON THE INTERNET 

Under Texas law, the statute of limitations for libel is one year after the date that the cause of action accrues. Tex. Civ. Prac. & Rem. Code Ann. § 16.002(a) (West 2002). To support their limitations ground, appellees relied on "the single publication rule," which our court has adopted in cases alleging mass media libel. See Holloway v. Butler, 662 S.W.2d 688, 690-91 (Tex. App.-Houston [14th Dist.] 1983, writ ref'd n.r.e.); see also Williamson v. New Times, Inc., 980 S.W.2d 706, 710 (Tex. App.-Fort Worth 1998, no pet.). The "single publication rule" provides,

No person shall have more than one cause of action for damages for libel . . . or any other tort founded upon any single publication or exhibition or utterance, such as any one edition or issue of a newspaper or book or magazine or any one presentation to an audience or any one broadcast over radio or television or any one exhibition of a motion picture. Recovery in any action shall include all damages for any such tort suffered by the plaintiff in all jurisdictions.
Holloway, 662 S.W.2d at 690. When the rule applies, a libel action accrues, for statute-of-limitations purposes, upon "publication." See id. at 692; see also Williamson, 980 S.W.2d at 710. Publication is complete on "the last day of the mass distribution of copies of the printed matter" because that is the day "when the publishers, editors and authors have done all they can to relinquish all right of control, title and interest in the printed matter." See Holloway, 662 S.W.2d at 692; see also Williamson, 980 S.W.2d at 710. Our court rejected the principle that each time a libelous article is brought to the attention of a third person, such as each time a libelous book, paper, or magazine is sold, a new publication has occurred, creating a separate tort. See Holloway, 662 S.W.2d at 690-91. The rationale behind the single-publication rule includes (1) preventing the assertion of stale claims, multiplicity of claims, and problems concerning apportionment of damages, conflicts of laws, and venue, and (2) the fact that the mass communication of a single defamatory statement constitutes, for all practical purposes, a single wrong. See id. at 691. A plaintiff is not limited to a single cause of action in the event the same information appears in separate printings of the same publication or in different publications. Id. at 692. The single publication rule applies strictly to multiple copies of a libelous article published as part of a single printing. Id.

Application of the single publication rule to internet publication

We recognize that the Holloway court defined the single publication rule to include only one cause of action for "any one broadcast over . . . television," but its discussion regarding determining when a publication has occurred focused on printed media, such as a newspaper. See id. at 690-92. Regardless, Mayfield does not challenge application of the single publication rule relative to the television broadcasts at issue; she focuses solely on the internet publication of the reports. In fact, as mentioned above, there is no evidence controverting appellees' proof that the reports were each broadcast only once on television. Thus, we need not further address the single publication rule relative to television broadcasts.

Rather, we turn to Mayfield's argument that the single publication rule should not apply when, as in the present case, a news report is posted on the publisher's webpage. Mayfield suggests a report posted on the internet has a greater potential than a report published in a newspaper or on television to remain publicly available for a long period, be repeatedly viewed, and be viewed by a wide audience. She apparently maintains that a new cause of action for libel accrues, for limitations purposes, each day that the report remains on the internet; i.e., there is a new publication and Mayfield has been defamed every day because the report remains accessible to third parties.

We have not found, and the parties do not cite, any Texas cases addressing whether the single publication rule applies to a media report posted on the internet. However, in Nationwide Bi-Weekly Administration, Inc. v. Belo Corp., 512 F.3d 137, 141-46 (5th Cir. 2007), the Fifth Circuit Court of Appeals predicted The Supreme Court of Texas would apply the rule to a report published on the internet and reject "the continuous publication rule" suggested by Mayfield—that when such a report remains constantly available on the internet, each day results in a new publication. See id. at 143 (recognizing Fifth Circuit, when applying Texas law but addressing unsettled issue, is required to follow the rule it believes the Supreme Court of Texas would adopt). The Fifth Circuit based its decision on (1) the majority view among courts, and (2) the rationale behind the rule. See id. at 142-46.

With respect to the first factor, the Fifth Circuit was persuaded by the fact that every court that had decided the issue as of that date had held the single publication rule applies to information publicly available on the internet. See id. at 144 (citing, e.g., Oja v. U.S. Army Corps of Eng'rs, 440 F.3d 1122, 1133 (9th Cir. 2006); Van Buskirk v. New York Times Co., 325 F.3d 87, 89 (2nd Cir. 2003); Mitan v. Davis, 243 F.Supp.2d 719, 724 (W.D. Ky. 2003); Churchill v. State, 378 N.J. Super. 471, 876 A.2d 311, 316 (2005); McCandliss v. Cox Enters., 265 Ga. App. 377, 593 S.E.2d 856, 858 (2004); Traditional Cat Ass'n, Inc. v. Gilbreath, 118 Cal.App.4th 392, 13 Cal.Rptr.3d 353, 361-62 (2004); Firth v. State, 98 N.Y.2d 365, 747 N.Y.S.2d 69, 775 N.E.2d 463, 466 (2002)).[6]

With respect to the second factor, the Fifth Circuit relied on the rationale behind the widespread acceptance of the single publication rule in the internet context, which consisted of the following considerations:

• The "functional similarities" between print and internet publications: "A statement electronically located on a server which is called up when a web page is accessed, is no different from a statement on a paper page in a book lying on a shelf which is accessed by the reader when the book is opened." Id. at 144 (quoting Mitan, 243 F.Supp.2d at 724); see also Kaufman v. Islamic Soc'y of Arlington, 291 S.W.3d 130, 140 (Tex. App.-Fort Worth 2009, pet. denied) (citing "functional similarities" recognized by Belo court as a factor when holding journalist author of internet article was "a member of the electronic or print media," same as one publishing through more traditional media, and thus authorized to bring interlocutory appeal from order denying summary judgment);
• More importantly, the "potential for endless retriggering of the statute of limitations, multiplicity of suits and harassment of defendants" and a corresponding chilling effect on internet communication. Belo, 512 F.3d at 145 (quoting Firth, 747 N.Y.S.2d 69, 775 N.E.2d at 466); and
• The fact that application of the rule to internet publications is consistent with the policy considerations cited by Texas courts for applying the rule to print media: to support the statute of limitation and prevent the filing of stale claims. Id. (citing Holloway, 662 S.W.2d at 691).
The Fifth Circuit further rejected arguments similar to those suggested by Mayfield in the present case. See id. at 145. Its plaintiff urged that "the publication of defamatory and private information on the web has the potential to be vastly more offensive and harmful than it might otherwise be in a more circumscribed publication." Id. The court reasoned that the concern more persons will read internet publications because they are likely accessible for a potentially indefinite period is outweighed by the competing policy interest of enforcing the statute of limitations and preventing stale claims. Id. (citing Holloway, 662 S.W.2d at 691). The court also reasoned that the concern regarding broader readership (irrespective of the temporal component) is likely relevant only to the issue of damages—not to the triggering of the statute of limitations. Id.

Although we are not bound by the Fifth Circuit's interpretation of Texas law, see Penrod Drilling Corp. v. Williams, 868 S.W.2d 294, 296 (Tex. 1993) Longview Bank & Trust Co. v. First Nat'l Bank of Azle, 750 S.W.2d 297, 300 (Tex. App.-Fort Worth 1988, no pet.), or its predictions about what rule The Supreme Court of Texas likely would apply, we agree with the Fifth Circuit's reasoning and hold that the single publication rule applies to a television station's news report publicly available on the internet. Accordingly, Mayfield's libel claim for each of the two reports at issue accrued on the sole date that the report was broadcast on television and posted on the station's website. Because Mayfield filed suit more than one year after each such broadcast and internet publication, her libel claim is barred by the statute of limitations.

SOURCE: FOURTEENTH COURT OF APPEALS IN HOUSTON - No. 14-13-00268-CV – 8/21/2014 – Mayfield v. Fullhart

Liability under the Texas Construction Fund Act

TEXAS CONSTRUCTION FUND ACT IMPOSES FIDUCIARY DUTIES 

The Texas Construction Fund Act is found in chapter 162 of the Texas Property Code. See TEX. PROP. CODE ANN. §§ 162.001-.033 (West, Westlaw through 2013 3d C.S.). This act "imposes fiduciary responsibilities on contractors to ensure that Texas subcontractors, mechanics, and materialmen are paid for work completed." In re Waterpoint Int'l LLC, 330 F.3d 339, 345 (5th Cir. 2003). This statute provides that construction payments are trust funds if the payments are made to a contractor or to an officer of the contractor for the improvement of specific real property. Id. § 162.001(a); see also Kelly v. Gen'l Interior Const. Inc., 262 S.W.3d 79, 85 (Tex. App.-Houston [14th Dist.]), overruled on other grounds, 301 S.W.3d 653 (Tex. 2010). 

The contractor or officer who receives the trust funds is considered a trustee of the funds. TEX. PROP. CODE ANN. § 162.002. The artisan, laborer, mechanic, contractor, subcontractor, or materialman who furnished labor or material for the construction or repair on the real property is considered the beneficiary of any trust funds. Id. § 162.003. A trustee who intentionally, knowingly, or with the intent to defraud, directly or indirectly retains, uses, disburses, or otherwise diverts the funds without first fully paying current or past due obligations has misapplied the trust funds. See id. § 162.031(a). "Thus, a party who misapplies these trust funds is subject to civil liability if (1) the party breaches the duty imposed by chapter 162, (2) with the requisite scienter, and (3) the claimants are within the class of people chapter 162 was designed to protect and have asserted the type of injury chapter 162 was intended to prohibit." C & G, Inc. v. Jones, 165 S.W.3d 450, 453 (Tex. App.-Dallas 2005, pet. denied). Any officer or director who has control or direction over the funds is also a trustee of the funds and is personally liable. Id. at 453-54.

SOURCE: CORPUS CHRISTI COURT OF APPEALS - No. 13-13-00118-CV - 5/29/2014

When courts refrain from involvement in the affairs and internal disputes of religious organizations: The ecclesiastical abstention doctrine

The Ecclesiastical Abstention Doctrine

"The Free Exercise clause of the First Amendment to the United States Constitution precludes civil courts from delving into matters focused on `theological controversy, church discipline, ecclesiastical government, or the conformity of the members of a church to the standard of morals required of them.'" Thiagarajan v. Tadepalli, Nos. 14-13-00132-CV & 14-13-00133-CV, 2014 WL 1711224, at *5 (Tex. App.-Houston [14th Dist.] Apr. 30, 2014, no pet. h.) (quoting Serbian E. Orthodox Diocese v. Milivojevich, 426 U.S. 696, 713-14, 96 S. Ct. 2372, 2382 (1976)). "The First Amendment is applicable to the states through the Fourteenth Amendment." Masterson v. Diocese of Nw. Tex., 422 S.W.3d 594, 601 (Tex. 2013) (citing Cantwell v. Connecticut, 310 U.S. 296, 303, 60 S. Ct. 900, 903 (1940)).

"Determining the reach of subject matter jurisdiction in disputes involving religious organizations requires consideration of competing demands." Thiagarajan, 2014 WL 1711224, at *5. "Courts do not have jurisdiction to decide questions of an ecclesiastical or inherently religious nature, so as to those questions they must defer to decisions of appropriate ecclesiastical decision makers." Masterson, 422 S.W.3d at 605-06. "But Texas courts are bound to exercise jurisdiction vested in them by the Texas Constitution and cannot delegate their judicial prerogative where jurisdiction exists." Id. at 606 (courts must "fulfill their constitutional obligation to exercise jurisdiction where it exists, yet refrain from exercising jurisdiction where it does not exist."); see also id. at 596 (Texas courts have a "constitutional duty to decide disputes within their jurisdiction while still respecting limitations the First Amendment places on that jurisdiction.").

"Properly exercising jurisdiction requires courts to apply neutral principles of law to non-ecclesiastical issues involving religious entities in the same manner as they apply those principles to other entities and issues." Masterson, 422 S.W.3d at 606. "Thus, courts are to apply neutral principles of law to issues such as land titles, trusts, and corporate formation, governance, and dissolution, even when religious entities are involved." Id. "[T]he line between required judicial action and forbidden judicial intrusion `will not always be distinct' because many disputes `require courts to analyze church documents and organizational structures to some degree.'" Thiagarajan, 2014 WL 1711224, at *5 (quoting Masterson, 422 S.W.3d at 606). "[C]ourts must look to the substance and effect of a plaintiff's complaint to determine its ecclesiastical implication, not its emblemata." Tran v. Fiorenza, 934 S.W.2d 740, 743 (Tex. App.-Houston [1st Dist.] 1996, no writ) (citing Green v. United Pentecostal Church Int'l, 899 S.W.2d 28, 30 (Tex. App.-Austin 1995, writ denied)); see also Williams v. Gleason, 26 S.W.3d 54, 59 (Tex. App.-Houston [14th Dist.] 2000, pet. denied) ("Whether this suit is ecclesiastical, or concerns property rights, torts, or criminal conduct, is determined by first examining the substance and effect of the [plaintiffs'] petition—without considering what they use as claims—to determine its ecclesiastical implication.").

SOURCE: HOUSTON COURT OF APPEALS - 01-13-00872-CV - 7/31/2014

We hold the trial court lacked subject-matter jurisdiction over this dispute under the ecclesiastical abstention doctrine. Cf. Masterson, 422 S.W.3d at 608 (dispute could be resolved by application of neutral principles of law, where bylaws expressly governed the question presented); see also Hosanna-Tabor, 132 S. Ct. at 706; Dean, 994 S.W.2d at 395.

Because we conclude that the trial court lacked subject-matter jurisdiction over this case, we do not reach Anderson's issues regarding the merits of the trial court's denial of his application for a temporary injunction.

Conclusion

We vacate the trial court's October 7, 2013 order and render judgment dismissing the case for want of subject-matter jurisdiction.

How does Texas law define a med-mal claim (health care liability claim)? Who is a covered provider? What is health care?

DEFINITION OF HEALTH CARE LIABILITY CLAIM 

Whether [a] claim is a health care liability claim is a question of law we review de novo. Tex. W. Oaks Hosp., LP v. Williams, 371 S.W.3d 171, 177 (Tex. 2012). When construing a statute, we give it the effect the Legislature intended. See Galbraith Eng'g Consultants, Inc. v. Pochucha, 290 S.W.3d 863, 867 (Tex. 2009). The best expression of the Legislature's intent is the plain meaning of the statute's text. Molinet v. Kimbrell, 356 S.W.3d 407, 411 (Tex. 2011). More particularly, the broad language of the Medical Liability Act evinces legislative intent for the statute to have expansive application. Loaisiga v. Cerda, 379 S.W.3d 248, 256 (Tex. 2012). In determining whether Sok's claim is a health care liability claim, we focus on the underlying nature of the cause of action and are not bound by the pleadings. Diversicare Gen. Partner, Inc. v. Rubio, 185 S.W.3d 842, 847 (Tex. 2005).

The Medical Liability Act defines a health care liability claim as:

a cause of action against a health care provider or physician for treatment, lack of treatment, or other claimed departure from accepted standards of medical care, or health care, or safety or professional or administrative services directly related to health care, which proximately results in injury to or death of a claimant, whether the claimant's claim or cause of action sounds in tort or contract.
TEX. CIV. PRAC. & REM. CODE § 74.001(a)(13). In Texas West Oaks, we observed that this statutory definition contains three elements:

(1) a physician or health care provider must be a defendant; (2) the claim or claims at issue must concern treatment, lack of treatment, or a departure from accepted standards of medical care, or health care, or safety or professional or administrative services directly related to health care; and (3) the defendant's act or omission complained of must proximately cause the injury to the claimant.
371 S.W.3d at 179-80. No one element, occurring independent of the other two, will recast a claim into a health care liability claim.

Who is a Health Care Provider?

The Medical Liability Act defines a health care provider to include, inter alia, an affiliate of a physician. See TEX. CIV. PRAC. & REM. CODE § 74.001(a)(12)(B)(i). The statute defines "affiliate" as "a person who, directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with a specified person, including any direct or indirect parent or subsidiary." Id. § 74.001(a)(1). And the statute defines control as "the possession of the power to direct the management and policies of the person" through ownership. Id. § 74.001(a)(3). Therefore, if we determine Dr. Nguyen directly or indirectly controls Bioderm, then we must conclude Bioderm is Dr. Nguyen's affiliate and is a health care provider under the Act. Id. §§ 74.001(a)(1), (a)(12)(B)(i).

What is health care? 

The Medical Liability Act defines health care as "any act or treatment performed or furnished, or that should have been performed or furnished, by any health care provider for, to, or on behalf of a patient during the patient's medical care, treatment, or confinement." TEX. CIV. PRAC. & REM. CODE § 74.001(a)(10). In Texas West Oaks, we considered whether a claim alleged a departure from accepted standards of health care and held that "if expert medical or health care testimony is necessary to prove or refute the merits of the claim against a physician or health care provider, the claim is a health care liability claim." 371 S.W.3d at 182. Accordingly, in considering whether a claim alleges a departure from accepted standards of medical or health care, a court should first determine whether expert medical or health care testimony is needed to establish the requisite standard of care and breach.[11] See id. And only if expert testimony is not needed should a court proceed to consider the totality of the circumstances, as a claim may still be a health care liability claim despite that "in the final analysis, expert testimony may not be necessary to support a verdict." Murphy v. Russell, 167 S.W.3d 835, 838 (Tex. 2005).[12] Therefore, we address whether expert health care testimony is needed to prove or refute the merits of Sok's claim.

SOURCE: TEXAS SUPREME COURT - No. 11-077 - 3/28/2014 - BIODERM SKIN CARE, LLC v. SOC 
The crux of the parties' disagreement on this question is whether Bioderm qualifies as a health care provider. Because Bioderm is an affiliate of a physician, we conclude it is a health care provider under the Medical Liability Act. 

What is an "expert report" required by the Texas statute governing health care liability claims?

EXPERT REPORTS UNDER TEXAS MEDICAL LIABILITY ACT

The Texas Medical Liability Act requires a claimant asserting a health care liability claim to timely serve one or more expert reports addressing the conduct of each health care provider against whom a claim has been asserted. § 74.351(a). If a sufficient expert report is not filed within the requisite period specified, section 74.351(b) mandates the court enter an order dismissing that claim, with prejudice. As to the sufficiency of the report, section 74.351(l) provides a trial court "shall grant a motion challenging the adequacy of an expert report only if it appears to the court, after hearing, that the report does not represent an objective good faith effort to comply with the definition of an expert report . . . ." To qualify as an objective good faith effort the report must (1) inform the defendant of the specific conduct the claimant questions, and (2) provide a basis for the trial court to conclude there is a meritorious claim. Loaisiga v. Cerda, 379 S.W.3d 248, 260 (Tex. 2012); Scoresby v. Santillan, 346 S.W.3d 546, 556 (Tex. 2011) (citing Palacios, 46 S.W.3d at 879).

An "expert report" is defined as a written report by an expert that provides a fair summary of the expert's opinions regarding (1) the applicable standards of care, (2) the manner in which the care rendered by the physician or health care provider fails to meet those standards and (3) the causal relationship between that failure and the injury, harm or damages claimed. See § 74.351(r)(6); see also TTHR Ltd. P'ship v. Moreno, 401 S.W.3d 41, 44 (Tex. 2013) (citing Palacios, 46 S.W.3d at 879); Certified EMS, Inc. v. Potts, 392 S.W.3d 625, 630 (Tex. 2013). The expert report must not be conclusory in its explanation of causation and it must explain the basis for the expert's causation opinions by linking the expert's conclusions to the facts. Bowie Mem'l Hosp. v. Wright, 79 S.W.3d 48, 52 (Tex. 2002); Palacios, 46 S.W.3d at 879; Wells v. Ashmore, 202 S.W.3d 465, 467 (Tex. App.-Amarillo 2006, no pet.). The report need not present evidence as if the plaintiff was actually litigating the merits, Palacios, 46 S.W.3d at 879, and there are no magic words required to establish causation. Bowie Mem'l Hosp., 79 S.W.3d at 53. "[A] report that satisfies these requirements, even if as to one theory only; entitle[s] the claimant to proceed with a suit against the physician or health care provider." Potts, 392 S.W.3d at 630.

SOURCE: AMARILLO COURT OF APPEALS - No. 07-13-00181-CV - 10/7/2014

Product liability claim vs negligence claim involving medical device

PRODUCT LIABILITY VS NEGLIGENCE (medical device) 

Normally, strict products liability and negligence are separate causes of action with different elements. Shaun T. Mian Corp. v. Hewlett-Packard, 237 S.W.3d 851, 857 (Tex. App.-Dallas 2007, pet. denied). However, here [PLAINTIFF] alleged no negligence other than conduct relating to whether the ventilator was unreasonably dangerous when sold. See id. As a result, [Plaintiff's] negligence theories are encompassed and subsumed in his defective product theories, and [Plaintiff's] burden at trial would be to prove injury resulting from a product defect. Id. Therefore, any error in disposing of [Plaintiff's] negligence claims cannot have caused the rendition of an improper judgment or prevented [PLAINTIFF] from properly presenting his case to this Court. See TEX. R. APP. P. 44.1(a); Hewlett-Packard, 237 S.W.3d at 857. [Plaintiff's] right to recover against Respironics stands or falls on the outcome of his products liability claims. Hewlett-Packard, 237 S.W.3d at 857. We thus affirm the trial court's judgment as to [Plaintiff's] negligence causes of action. Id.

STRICT LIABILITY 

Products liability imposes strict liability on the manufacturer of an unreasonably dangerous product that is a producing cause of a plaintiff's injuries. Id. The plaintiff must prove the product was defective when it left the hands of the manufacturer and that the defect was a producing cause of the plaintiff's injuries. Ford Motor Co. v. Ridgway, 135 S.W.3d 598, 600 (Tex. 2004); Hewlett-Packard, 237 S.W.3d at 858. A manufacturing defect exists when a product deviates, in its construction or quality, from the specifications or planned output in a manner that renders it unreasonably dangerous. Ridgway, 135 S.W.3d at 600; Hewlett-Packard, 237 S.W.3d at 858.

EXPERT TESTIMONY REQUIRED 

Generally, the requirements to prove a design defect in a products liability action necessitate competent expert testimony and objective proof that a defect caused the injury. See Nissan Motor Co. Ltd. v. Armstrong, 145 S.W.3d 131, 137 (Tex. 2004); Champion v. Great Dane Ltd. Partnership, 286 S.W.3d 533, 538 (Tex. App.-Houston [14th Dist.] 2009, no pet.).

Here, [Plaintiff] failed to present expert testimony that the ventilator was defective when it left the hands of Respironics. See Ridgway, 135 S.W.3d at 600; Hewlett-Packard, 237 S.W.3d at 858.

Products liability theories 

Products liability theories: defective design, defective manufacturing, and defective marketing.

Products liability imposes strict liability on the manufacturer of an unreasonably dangerous product that is a producing cause of a plaintiff's injuries.  The plaintiff must prove the product was defective when it left the hands of the manufacturer and that the defect was a producing cause of the plaintiff's injuries. Ridgway, 135 S.W.3d at 600; Hewlett-Packard, 237 S.W.3d at 858. A manufacturing defect exists when a product deviates, in its construction or quality, from the specifications or planned output in a manner that renders it unreasonably dangerous. Ridgway, 135 S.W.3d at 600; Hewlett-Packard, 237 S.W.3d at 858. Generally, the requirements to prove a design defect in a products liability action necessitate competent expert testimony and objective proof that a defect caused the injury. See Nissan Motor Co. Ltd. v. Armstrong, 145 S.W.3d 131, 137 (Tex. 2004); Champion v. Great Dane Ltd. Partnership, 286 S.W.3d 533, 538 (Tex. App.-Houston [14th Dist.] 2009, no pet.).

SOURCE: DALLAS COURT OF APPEALS - No. 05-11-01057-CV - 7/23/2014

See Ford Motor Co. v. Ridgway, 135 S.W.3d 598, 600 (Tex. 2004).

Under what circumstances is a contract construed as a matter of law, and extrinsic evidence precluded?

CONTRACT CONSTRUCTION AS A MATTER OF LAW 

If a written contract has a definite legal meaning, then a court should read the text and construe it as a matter of law without help from a jury. Frost Nat'l Bank v. L & F Distribs., Ltd., 165 S.W.3d 310, 312 (Tex. 2005) (per curiam); Coker v. Coker, 650 S.W.2d 391, 393 (Tex. 1983). When the words on the page suffice, a court should not look outside the document to decide what the parties agreed. J.M. Davidson, Inc. v. Webster, 128 S.W.3d 223, 229 (Tex. 2003). The overriding objective is to "ascertain and give effect to the parties' intentions as expressed in the document." Frost Bank, 165 S.W.3d at 311-12.

However, if a contract is ambiguous, the court should accept parol evidence and can empanel a jury to decide, as an issue of fact, the "true intent of the parties." Coker, 650 S.W.2d at 394-95. A contract is ambiguous if it is open to more than one reasonable reading. Frost Bank, 165 S.W.3d at 312. Deciding whether a contract is ambiguous is itself an issue of law for the court. Webster, 128 S.W.3d at 229.

To determine whether a contract is ambiguous, courts apply standard rules of interpretation. Frost Bank, 166 S.W.3d at 312. These rules require an attempt to harmonize the contract as a whole. Id. An ideal harmonization will not treat any clause as a nullity, and courts generally presume that every provision was intended to have some effect. Heritage Res., Inc. v. NationsBank, 939 S.W.2d 118, 121 (Tex. 1996). Words should be given their ordinary meaning unless it appears from context that they were used in a technical or different sense. Id. Courts should interpret contracts from a utilitarian perspective, keeping in mind the parties' business objectives. Frost Bank, 165 S.W.3d at 312. Absurd, inequitable, or oppressive interpretations are to be eschewed unless they prove unavoidable. Id.

SOURCE: HOUSTON COURT OF APPEALS - No. 01-12-00677-CV - 2/13/2014

The lease unambiguously does not require First Industrial to give Michelin advance notice of the amount of the policy's deductible. See R & P Enters. v. LaGuarta, Gavrel & Kirk, Inc., 596 S.W.2d 517, 519 (Tex. 1980) ("If a written instrument is so worded that a court may properly give it a certain or definite legal meaning or interpretation, it is not ambiguous."). As the contract is unambiguous, our determination of its meaning is a legal conclusion. See Frost Bank, 165 S.W.3d at 312. The trial court correctly disregarded the jury's findings and entered judgment in favor of First Industrial.

ADDITIONAL CASE

See Gilbert Tex. Contr., L.P. v. Underwriters at Lloyd's London, 327 S.W.3d 118, 133 (Tex. 2010) ("If a contract as written can be given a clear and definite legal meaning, then it is not ambiguous as a matter of law.").

Can prevailing defendants get attorney's fees under the Texas Theft Liability Act (TTLA)?

Unlike other statutes that authorize recovery of attorney's fees as an exception to the American Rule, the Texas Theft Liability Act (TTLA) provides for an award of such fees to the prevailing party, which includes the party that successfully defends a statutory civil theft claim, not just the prevailing plaintiff. No showing of frivolousness is required. Dismissal with prejudice signifies success for fee purposes because it entails preclusive effect and thereby alters the relationship between the parties. 


THEFT LIABILITY ACT AND ATTORNEY FEE RECOVERY

Section 134.005(b) of the TTLA provides that "[e]ach person who prevails in a suit under this chapter shall be awarded court costs and reasonable and necessary attorney's fees." TEX. CIV. PRAC. & REM. CODE ANN. § 134.005(b). The award of fees to a prevailing party in a TTLA action is mandatory. Bocquet v. Herring, 972 S.W.2d 19, 20 (Tex. 1998) ("Statutes providing that a party `may recover,' `shall be awarded,' or `is entitled to' attorney fees are not discretionary.").

The TTLA statute does not contain a definition of "prevails" to assist in determining who qualifies as a prevailing party. Courts have looked to the term's "ordinary" meaning to determine its scope for both statutory and contractual claims. See, e.g., Epps v. Fowler, 351 S.W.3d 862, 866 (Tex. 2011) (construing written contract to give meaning to undefined term "prevailed" while noting that phrase "prevailing party" is given its ordinary meaning and has been explicated through statutory interpretation by many courts).

Courts have held that the phrase "prevailing party" in section 134.005(b) of the TTLA includes both a plaintiff successfully prosecuting a theft suit and a defendant successfully defending against one. Peoples v. Genco Fed. Credit Union, No. 10-09-00032-CV, 2010 WL 1797266, at *7 (Tex. App.-Waco May 5, 2010, no pet.) (mem. op.); Brown v. Kleerekoper, No. 01-11-00972-CV, 2013 WL 816393, *5 (Tex. App.-Houston [1st Dist.] March 5, 2013, pet. filed) (mem. op.). A prevailing defendant is entitled to attorney's fees "without any prerequisite that the claim is found to be groundless, frivolous, or brought in bad faith." Air Routing Int'l Corp. (Canada) v. Britannia Airways, Ltd., 150 S.W.3d 682, 686 (Tex. App.-Houston [14th Dist.] 2004, no pet.). Thus, Equicap's status defending against a TTLA claim does not prevent recovery of attorney's fees.

Prevailing on portion of but not entire suit

In Moak v. Huff, No. 04-11-00184-CV, 2012 WL 566140, at *11 (Tex. App.-San Antonio Feb. 15, 2012, no pet.) (mem. op.), the defendant lost on the plaintiff's DTPA claim but successfully defended against the plaintiff's TTLA claim. Id., 2012 WL 566140, at *1. The defendant then sought an award of attorney's fees under the TTLA. Id., 2012 WL 566140, at *9. The plaintiff resisted, arguing that a person does not "prevail in a suit" unless he is the "party in whose favor a judgment is rendered" and is "vindicated by the judgment." Id., 2012 WL 566140, at *10. The plaintiff maintained that the defendant had to prevail on the entire suit to recover attorney's fees under the TTLA. Id.

The court of appeals disagreed, holding that "a person who prevails in a TTLA cause of action is entitled to recover the reasonable fees necessarily incurred prosecuting or defending that cause of action, even if the party is unsuccessful on other claims and counterclaims litigated in the same suit." Id., 2012 WL 566140, at *11; see Brown, 2013 WL 816393, at *5 (holding that defendant who successfully defended theft-of-property claim under TTLA was entitled to attorney's fees even if defendant did not prevail on other causes of action). Thus, Equicap's failure to obtain judgment on its breach-of-contract claim does not affect its recovery of attorney's fees as the prevailing party on the TTLA claim.

A defendant "prevails" if the plaintiff's claim is dismissed with prejudice

A party prevails if he "successfully prosecutes the action or successfully defends against it. . . ." Johns v. Ram-Forwarding, Inc., 29 S.W.3d 635, 637-38 (Tex. App.-Houston [1st Dist.] 2000, no pet.). A defendant who has the claims against him resolved by voluntary dismissal without prejudice generally is not considered a prevailing party or entitled to an award of attorney's fees. Cricket Commc'ns, Inc. v. Trillium Indus., Inc., 235 S.W.3d 298, 311 (Tex. App.-Dallas 2007, no pet.); Travel Music of San Antonio, Inc. v. Douglas, No. 04-00-00757-CV, 2002 WL 1058527, at *3 (Tex. App.-San Antonio May 29, 2002, pet. denied) (mem. op., not designated for publication). This is because a dismissal without prejudice does not materially alter the plaintiff's legal relationship with the defendant; the plaintiff is free to reassert his claims and may prevail against the defendant at a later date. See Epps, 351 S.W.3d at 869.

The legal relationship between a plaintiff and defendant does change, however, when the plaintiff's claims are dismissed with prejudice. Epps, 351 S.W.3d at 866-69. When a plaintiff's claims are dismissed with prejudice, the doctrine of res judicata prohibits the plaintiff from re-asserting his claims against that defendant in a later suit. Epps, 351 S.W.3d at 867; see Mossler v. Shields, 818 S.W.2d 752, 754 (Tex. 1991) (holding that dismissal with prejudice functions as final determination on merits); see also Williams v. TDCJ-Inst. Div., 176 S.W.3d 590, 594 (Tex. App.-Tyler 2005, pet. denied) (holding that dismissal with prejudice has full res judicata and collateral estoppel effect).

Res judicata attaches to a dismissal with prejudice even though the plaintiff's claims have not been fully litigated at trial. See Epps, 351 S.W.3d at 868-69. Res judicata applies because "a dismissal or nonsuit with prejudice is `tantamount to a judgment on the merits,'" and the effect of res judicata in that instance "works a permanent, inalterable change in the parties' legal relationship to the defendant's benefit: the defendant can never again be sued by the plaintiff or its privies for claims arising out of the same subject matter." Id. at 868-69.

The TTLA claim asserted against Equicap was dismissed with prejudice, but the basis for dismissal was specified as want of prosecution: "Accordingly, it is ORDERED and DECREED . . . that all claims by the Estate . . . are DISMISSED with PREJUDICE, for want of prosecution." See TEX. R. CIV. P. 165a (permitting dismissal of plaintiff's claims for want of prosecution).

A dismissal for failure to appear at trial or for want of prosecution should be without prejudice. See Att'y Gen. v. Rideaux, 838 S.W.2d 340, 342 (Tex. App.-Houston [1st Dist.] 1992, no writ) ("[A] trial court's authority to dismiss cases for want of prosecution does not confer upon it the authority to adjudicate and deny the merits of the dismissed claim."). An order dismissing a claim with prejudice when only dismissal without prejudice was appropriate can be challenged through a postjudgment motion. See El Paso Pipe & Supply v. Mountain States Leasing, Inc., 617 S.W.2d 189, 190 (Tex. 1981). While admittedly erroneous, a dismissal with prejudice that should have been without prejudice is not automatically void— it is merely voidable. Id.; Travelers Ins. Co. v. Joachim, 315 S.W.3d 860, 863-64 (Tex. 2010) (holding that erroneous order dismissing case with prejudice for want of prosecution "must be attacked directly in order to prevent the order from becoming final. . . ."). A plaintiff must affirmatively challenge the order to avoid it becoming a final judgment. Joachim, 315 S.W.3d at 863-64 (citing El Paso, 617 S.W.2d at 190). If the plaintiff fails to challenge the error, the order of dismissal with prejudice becomes "a final determination on the merits for purposes of res judicata." Id. at 866.

The Estate did not challenge the dismissal of its TTLA claim with prejudice. Accordingly, the dismissal is treated as a final determination on the merits and res judicata applies. Joachim, 315 S.W.3d at 864, 866; El Paso, 617 S.W.2d at 190; see Mossler, 818 S.W.2d at 754; see also Williams, 176 S.W.3d at 594.

Because res judicata applies to the Estate's TTLA claim against Equicap, the parties' legal relationship has changed in a manner that materially benefited Equicap and, as such, permits Equicap to qualify as a prevailing party under the TTLA statute. See Epps, 351 S.W.3d at 868 (stating that "we have no doubt that a defendant who is the beneficiary of a nonsuit with prejudice would be a prevailing party."); cf. Doolin's Harley-Davison, Inc. v. Young, No. 06-05-00101-CV, 2006 WL 27983, at *3 (Tex. App.-Texarkana Jan. 6, 2006, no pet.) (mem. op.) (holding that defendant was not prevailing party because matter was dismissed without prejudice and plaintiff retained right to refile case).

Accordingly, the trial court was required to award to Equicap its attorney's fees related to defending against the TTLA claim. TEX. CIV. PRAC. & REM. CODE ANN. § 134.005(b) (providing that prevailing party on TTLA claim "shall be awarded" attorney's fees); Brown, 2013 WL 816393, at *5. We sustain Equicap's first issue and hold that the trial court erred by denying Equicap's timely request for attorney's fees under the TTLA, given that the trial court ordered dismissal with prejudice.

Remand to determine attorney's fees

We have held that Equicap is entitled to an award of attorney's fees on the TTLA claim because it prevailed through dismissal of the Estate's claim with prejudice. When an award of attorney's fees to a prevailing party is mandated by statute, the factfinder can decide to award zero attorney's fees only if the evidence (1) failed to prove (a) that the attorney's services were provided or (b) the value of the services provided; or (2) affirmatively showed that (a) no attorney's services were needed or (b) that any services provided were of no value. Recognition Commc'ns, Inc. v. Am. Auto. Ass'n, Inc., 154 S.W.3d 878, 891 (Tex. App.-Dallas 2005, pet. denied); Citibank (S.D.), N.A. v. Tran, No. 05-11-01423-CV, 2013 WL 3205878, at *6 (Tex. App.-Dallas Aug. 26, 2013, pet. denied) (mem. op.).

If there is any evidence in support of the award of fees, the factfinder does not have discretion to award no fees. See Tony Gullo Motors I, L.P. v. Chapa, 212 S.W.3d 299, 311-14 (Tex. 2006); see also Tran, 2013 WL 3205878, at *7 (holding that prevailing party could not be awarded zero attorney's fees by jury when attorney testified that he provided legal services and his testimony established that services had value); Glenn v. Pack, No. 02-09-00204-CV, 2011 WL 167254, at *7 (Tex. App.-Fort Worth Jan. 13, 2011, no pet.) (mem. op.) (holding that jury could not award zero attorney's fees on breach-of-contract counterclaim when attorney testified to some fee amount).

A prevailing party entitled to attorney's fees is required to "segregate fees between claims for which they are recoverable and claims for which they are not." Chapa, 212 S.W.3d at 311. Failure to segregate, though, does not result in the denial of any fee. Tran, 2013 WL 3205878, at *7 (holding that testimony of aggregate fee was some evidence of segregated fees and, therefore, supported remand); Glenn, 2011 WL 167254, at *7 ("[Party's] failure to segregate fees does not mean that he cannot recover any fees. . . ."). Rather, testimony of the full, unsegregated amount of the fee is treated as "some evidence" of the segregated fee amount, and remand is appropriate to determine the segregated fee amount due. Glenn, 2011 WL 167254, at *7; Wright v. McCusker, No. 04-99-00592-CV, 2000 WL 863099, at *2 (Tex. App.-San Antonio June 28, 2000, no pet.) (mem. op., not designated for publication).

Because the reasonableness of a fee award is a question of fact and Equicap produced some evidence of its fees, we remand for a new trial on attorney's fees.

Conclusion

Having sustained Equicap's first issue, we reverse the trial court's judgment denying attorney's fees and remand for a new trial on attorney's fees.

SOURCE: FIRST COURT OF APPEALS IN HOUSTON - No. 01-12-01133-CV - 7/1/2014

Justice Jim Sharp - Master of Judicial Intemperance and Featured Speaker at Houston NORML Event - Halloweed 2014 (pre-election update)

Incumbent Jim Sharp looking for some weed-minded votes? 

CALLING ALL HILLBILLIES: RE-ELECT JIM SHARP -- AT YOUR PERIL 

Ever so often you get a member of the judiciary who does not give a rodent's posterior about the essential elements of a cause of action, established precedent, or the rules of civil and appellate procedure for that matter, and instead rules according to his whim; -- be it to play favorites or simply to show a disfavored litigant or attorney who is boss with the power of say-so.

Jim Sharp, desk-top jurist of Houston, fits that description.    

Not only has Sharp enriched the legal lexicon with gutter slang and locutions far more suitable for inclusion in the Urban Dictionary than the latest edition of Black's, as documented in cringe-inducing detail by both the Commission on Judicial Conduct and a Special Court of Review;

Not only has Sharp seen fit to boost his stature by mounting his desk for the benefit of the readership of the local paper that might not otherwise appreciate his grandeur (see picture).

The Emperor hath clothes, but what about propriety
and judicial decorum? 

He has also left his unseemly blots on the state's body of caselaw with holdings wacky enough to make one wonder whether he is fit to be a lawyer, not to mention a justice lording over the trial courts: How about holdings to the effect that a breach-of-contract plaintiff does not have to prove the contract; that deemed admissions can support a judgment even though the requests for admissions were never served; that an appellant failed to preserve error for appellate review of an award of attorneys fees even though the appeal was from a post-answer default judgment,  which - by definition - means that the party was not present in court to make objections, which -- under long-standing precedent -- does not preclude him or her from challenging the sufficiency of the evidence on appeal; that a superseded pleading can be considered on appeal even though it was rendered inoperative by the amendment in the trial court; that the reviewing court is not bound by the trial court's findings of fact; and that a suit against a debt collector for wrongful garnishment of social security benefits under the FDCPA and the Texas Debt Collection Act/DTPA is jurisdictionally barred merely because the plaintiff also included a challenge to the constitutionality of the garnishment statute and had not notified the Texas Attorney General of that argument.

Justice Sharp felt no compunction about using his authority as a member of the First Court of Appeals in a bid to obtain special treatment for a teen-aged girl caught shop lifting, did not feel constrained to direct a fusillade of insults at county employees who refused to acquiesce to his meddling, and has not felt constrained by established precedent and rules of procedure in his work on the court of appeals either.

As his peers are loath to police one of their own, especially when those harmed by the aberrant jurisprudence are -- to use Sharp's derogatory diction - mere hillbillies -- the job of stopping a wayward jurist on an ego trip from inflicting even more damage, and from continuing to make a mockery of rules and precedent, will be left to the voting public, come election day.

Justice Jim Sharp wants your vote despite having been reprimanded by the State Commission on Judicial Conduct 

CASES: FIRST COURT OF APPEALS: 01-11-00320-CV - 8/27/2013; 01-13-00986-CV and 01-12-01000-CV 8/26/2014 (All opinions by Justice Jim Sharp aka James Patrick Sharp, Jr.)

Legal sufficiency of evidence to support credit card debt claim: Proof of contract terms required

CREDITOR MUST PROVE AGREEMENT ON SPECIFIC TERMS OF GOVERNING EXTENSION OF CREDIT 

In a bench trial in which no findings of fact or conclusions of law are requested by the parties or filed by the trial court, we imply all findings of fact necessary to support the judgment. See, e.g., BMC Software Belg., N.V. v. Marchand, 83 S.W.3d 789, 795 (Tex. 2002). When the appellate record includes the reporter's and clerk's records, these implied findings are not conclusive and may be challenged for legal and factual sufficiency in the appropriate appellate court. Id. We review the sufficiency of the evidence supporting the findings by applying the same standards that we use in reviewing the legal or factual sufficiency of the evidence supporting jury findings. Catalina v. Blasdel, 881 S.W.2d 295, 297 (Tex. 1994); see Dittman v. Cerone, No. 13-11-00196-CV, 2013 WL 5970356, at *3 (Tex. App.-Corpus Christi Oct. 31, 2013, no pet.) (mem. op. on reh'g).

The test for legal sufficiency is "whether the evidence at trial would enable reasonable and fair-minded people to reach the verdict under review." City of Keller v. Wilson, 168 S.W.3d 802, 827 (Tex. 2005). In making this determination, we credit favorable evidence if a reasonable fact-finder could, and disregard contrary evidence unless a reasonable fact-finder could not. Id. So long as the evidence falls within the zone of reasonable disagreement, we may not substitute our judgment for that of the fact-finder. Id. at 822. The trier of fact is the sole judge of the credibility of the witnesses and the weight to give their testimony. Id. at 819. Although we consider the evidence in the light most favorable to the challenged findings, indulging every reasonable inference that supports them, we may not disregard evidence that allows only one inference. Id. at 822.

To recover for breach of contract, a plaintiff must show: (1) the existence of a valid contract; (2) the plaintiff performed or tendered performance; (3) the defendant breached the terms of the contract; and (4) the plaintiff suffered damages as a result of the defendant's breach. Woodhaven Partners, Ltd. v. Shamoun & Norman, LLP, 422 S.W.3d 821, 837 (Tex. App.-Dallas 2014, no pet.); Williams v. Unifund CCR Partners Assignee of Citibank, 264 S.W.3d 231, 235-36 (Tex. App.-Houston [1st Dist.] 2008, no pet.); McLaughlin, Inc. v. Northstar Drilling Tech., Inc., 138 S.W.3d 24, 27 (Tex. App.-San Antonio 2004, no pet.).

Thus, in this case, Pharia had the burden to prove each element of a breach of contract claim at trial. See Preston State Bank v. Jordan, 692 S.W.2d 740, 744 (Tex. App.-Fort Worth 1985, no writ) (affirming a take-nothing judgment in a suit to recover a credit card debt when the bank failed to present evidence of the contract between the bank and the credit card holder).

Parties form a binding contract when the following elements are present: (1) an offer; (2) an acceptance in strict compliance with the terms of the offer; (3) a meeting of the minds; (4) each party's consent to the terms; and (5) the execution and delivery of the contract with the intent that it be mutual and binding. Williams, 264 S.W.3d at 236. To be enforceable, a contract must be sufficiently certain to enable a court to determine the rights and responsibilities of the parties. T.O. Stanley Boot Co., Inc. v. Bank of El Paso, 847 S.W.2d 218, 221 (Tex. 1992). The material terms of a contract must be agreed upon before a court can enforce the contract; the interest rate is a material term. Id.

SOURCE: Court of Appeals of Texas, Thirteenth District,Corpus Christi, Edinburg. - No. 13-13-00551-C - 7/17/2014

ASSIGNEE OF CREDIT CARD ISSUER FAILED TO PROVE THE CONTRACT TERMS

As noted, the only evidence offered by Pharia of a valid contract was two pages reflecting a copy of a Bank of America cardholder agreement in print so small that the copies are rendered illegible. 

Although the "Affidavit of Indebtedness and Assignment" by Halpin states that the balance due on Uribe's account is "$2,789.70 plus interest per the terms of the agreement between the defendant and the original creditor at the rate of 28.99% per annum," there is no evidence establishing Uribe's specific obligations under the agreement or that Uribe agreed to the interest rate asserted by Halpin. 

Also, there is no evidence explaining how the $2,789.70 balance stated by Halpin became the $4,285.31 balance claimed by Pharia. The several account statements and several pages of text that appear to be a card member agreement were in Spanish, and Pharia provided no translation of the documents. See TEX. R. EVID. 1009(a) (providing that English translations of foreign-language documents are admissible in certain circumstances, not applicable here). 

We conclude that, although there is evidence of a credit-card agreement of some kind, there was no evidence proving the terms of that agreement or Uribe's intent to be bound by a specific agreement. See Williams, 264 S.W.3d at 236 (holding evidence was insufficient to establish the terms of a valid contract as a matter of law where creditor failed to produce actual credit-card agreement or any other document that established the agreed terms, including the applicable interest rate or method for determining finance charges); Tully v. Citibank (S.D.), N.A., 173 S.W.3d 212, 216-17 (Tex. App.-Texarkana 2005, no pet.) (holding evidence insufficient to show interest rate charged was agreed on where the only evidence was the rates specified in monthly statements); Jordan, 692 S.W.2d at 744 (holding evidence insufficient to establish a contract where creditor failed to introduce contract or its terms and conditions); see also Hooper v. Generations Cmty. Fed. Credit Union, No. 04-12-00080-CV, 2013 WL 2645111, at *3 (Tex. App.-San Antonio June 12, 2013, no pet.) (mem. op.) (reversing judgment for creditor where cardholder agreement was not offered into evidence and there was no evidence establishing debtor's specific obligations under an agreement); Colvin v. Tex. Dow Employees Credit Union, No. 01-11-00342-CV, 2012 WL 5544950, at *6 (Tex. App.-Houston [1st Dist.] Nov. 15, 2012, no pet.) (mem. op.) (reversing summary judgment for creditor where creditor failed to offer the original agreement, monthly statements, or other evidence establishing how it calculated its alleged damages); Martin v. Federated Capital Corp., No. 01-12-00116-CV, 2012 WL 4857835, at **2-3 (Tex. App.-Houston [1st Dist.] Oct. 11, 2012, no pet.) (mem. op.) (reversing summary judgment for creditor where creditor's evidence failed to explain how it calculated its damages); Ayers v. Target Nat'l Bank, No. 14-11-00574-CV, 2012 WL 3043043, at **2-4 (Tex. App.-Houston [14th Dist.] July 26, 2012, no pet.) (mem. op.) (reversing summary judgment for creditor where creditor failed to present cardholder agreement and a portion of the form language on the credit-card application was illegible and form language was in Spanish); Wande v. Pharia, No. 01-10-00481-CV, 2011 WL 3820774, at *5 (Tex. App.-Houston [1st Dist.] Aug. 25, 2011, no pet.) (mem. op.) (reversing summary judgment for creditor where creditor presented the cardholder agreement but important portions of the agreement were illegible, including a section entitled "Finance Charges," and creditor presented no evidence regarding the calculations it used to arrive at claimed outstanding balance); Jaramillo v. Portfolio Acquisitions, LLC, No. 14-08-00938-CV, 2010 WL 1197669, at **5-6 (Tex. App.-Houston [14th Dist.] March 30, 2010, no pet.) (mem. op.) (holding evidence insufficient to establish a valid contract where card member agreement was entered into evidence, but many of its material terms were missing; "This court and its sister court have drawn a distinction between cases where a card member agreement is entered into evidence and where there is no card member agreement.").

Considering the evidence in the light most favorable to the challenged finding, see City of Keller, 168 S.W.3d at 822, we conclude that no reasonable fact-finder could have found the evidence sufficient to establish the existence of a valid contract. See Williams, 264 S.W.3d at 236; T.O. Stanley Boot Co., 847 S.W.2d at 221. The evidence was therefore legally insufficient to establish the existence of a valid contract. We sustain Uribe's second issue.

CONCLUSION

Because we hold the evidence insufficient to establish the existence of a valid contract, we reverse the trial court's judgment and render judgment that Pharia take nothing.  

SOURCE: CORPUS CHRISTI COURT OF APPEALS - 13-13-00551-C - 7/17/2014 (Uribe v Pharia) 

Two types of mechanic's liens under Texas law

CONSTITUTIONAL AND STATUTORY MECHANICS LIEN 

Texas law recognizes two possible types of mechanic's liens: (1) a constitutional lien and (2) a statutory lien. TEX. CONST. art. XVI, § 37; TEX. PROP. CODE ANN. 53.001 (West 2007). "[A] constitutional lien requires a person to be in privity of contract with the property owner."

Article XVI, Section 37 of the Texas Constitution provides,
Mechanics, artisans and material men, of every class, shall have a lien upon the buildings and articles made or repaired by them for the value of their labor done thereon, or material furnished therefor; and the Legislature shall provide by law for the speedy and efficient enforcement of said liens.
TEX. CONST. art. XVI, § 37.

Trinity Drywall Sys., LLC v. Toka Gen. Contrs., Ltd., 416 S.W.3d 201, 209 (Tex. App.-El Paso 2013, pet. filed); see Gibson v. Bostick Roofing & Sheet Metal Co., 148 S.W.3d 482, 493 (Tex. App.-El Paso 2004, no pet.). The same privity of contract with the property owner is required to establish a statutory lien that encumbers the owner's property. See TEX. PROP. CODE ANN. § 53.021(a)(2) (West Supp. 2013) (A person has a statutory lien if "the person labors . . . or furnishes the labor or materials under or by virtue of a contract with the owner or the owner's agent. . . ."); TEX. PROP. CODE ANN. § 53.001(7) (defining "Original Contractor" as "a person contracting with an owner either directly or through the owner's agent").

"[W]here the contract for labor, materials or construction is not made with the owner or his duly-authorized agent, a lien may not be fixed on his property." Gibson, 148 S.W.3d at 494; see 2811 Assocs., Ltd. v. Metroplex Lighting & Elec., 765 S.W.2d 851, 853 (Tex. App.-Dallas 1989, writ denied).

SOURCE: TEXARKANA COURT OF APPEALS - No. 06-14-00022-CV - DENCO CS CORPORATION v. BODY BAR - 9/26/2014 (the mechanic's lien affidavit was not filed until after
the sale of the property).

Smith's lien affidavit listed Bre Thorne as the owner of the property sought to be encumbered. Yet, there is no evidence in the record establishing that either Regency (who was the owner of the premises at the time the contract for improvements was entered) or Bre Thorne (the subsequent owner) contracted with Denco or that Body Bar was the agent of either at the time it entered into the contract for improvements or when Denco's additional charges supposedly accrued.

Because there was no evidence that Denco was in privity of contract with the owner of the premises, it was not entitled to a constitutional lien against Bre Thorne's fee interest in the property. "[I]f a lessee contracts for construction, the mechanic's lien attaches only to the leasehold interest, not to the fee interest of the lessor." Diversified Mortg. Investor v. Lloyd D. Blaylock Gen. Contractor, Inc., 576 S.W.2d 794, 805 (Tex. 1978); see Bannum, Inc. v. Mees, No. 07-12-00458-CV, 2014 WL 2918436, at **3-4 (Tex. App.-Amarillo Jun. 24, 2014, no pet. h.) (mem. op.); Terraces at Cedar Hill, L.L.C. v. Gartex Masonry & Supply, Inc., No. 05-10-00226-CV, 2011 WL 1050852, at *2 (Tex. App.-Dallas Mar. 24, 2011, pet. denied) (mem. op.). Thus, the affidavit laying claim to statutory and constitutional mechanic's liens—which were not limited to Body Bar's leasehold interest—did not validly encumber the property.[12] Because the liens were not perfected, Denco was not entitled to foreclosure.

PERFECTION OF LIEN

"A person who files an affidavit must send a copy of the affidavit by registered or certified mail to the owner or reputed owner . . . not later than the fifth day after the date the affidavit is filed with the county clerk." TEX. PROP. CODE ANN. § 53.055(a) (West 2007). "A party must comply with chapter 53 to perfect a lien under the statute." Addison Urban Dev. Partners, LLC v. Alan Ritchey Materials Co., LC, No. 05-13-00122-CV, 2014 WL 2946019, at *4 (Tex. App.-Dallas July 1, 2014, no pet. h.) (citing Morrell Masonry Supply, Inc. v. Lupe's Shenandoah Reserve, LLC, 363 S.W.3d 901 (Tex. App.-Beaumont 2012, no pet.); TEX. PROP. CODE ANN. § 53.051). 

Here, Denco admitted that it failed to comply with Section 53.055(a). However, substantial compliance with Chapter 53 is sufficient, and "[c]ases interpreting the mechanic's and materialman's lien statutes counsel against invalidating a lien on a purely technical basis." Id. (citing Ready Cable, Inc. v. RJP S. Comfort Homes, Inc., 295 S.W.3d 763, 765 (Tex. App.-Austin 2009, no pet.)).  

SOURCE: TEXARKANA COURT OF APPEALS - No. 06-14-00022-CV - DENCO CS CORPORATION v. BODY BAR - 9/26/2014

Proving arbitrability (arbitration agreement)

WHO HAS THE BURDEN TO PROVE EXISTENCE OF VALID ARB AGREEMENT?

The burden of establishing an arbitration agreement's existence is evidentiary and runs with the party seeking to compel arbitration. Mohamed v. Auto Nation USA Corp., 89 S.W.3d 830, 836 (Tex.App.-Houston [1st Dist.] 2002, orig. proceeding). A strong presumption in favor of arbitration attaches "only after the party seeking to compel arbitration proves that a valid arbitration agreement exists." J.M. Davidson, Inc., v. Webster, 128 S.W.3d 223, 227 (Tex. 2003). "No party is under a duty to arbitrate unless by clear language he has previously agreed to do so; and it must clearly appear that the intention of the parties was to submit their dispute to an arbitration panel and to be bound by the panel's decision." Webb v. Investacorp, 89 F.3d 252, 259 (5th Cir. 1996), quoting Massey v. Galvan, 822 S.W.2d 309, 316 (Tex.App.-Houston [14th Dist.] 1992, writ denied).

"[A]n employer attempting to enforce an arbitration agreement must show the agreement meets all requisite contract elements." Webster, 128 S.W.3d at 228. "[O]rdinary principles of state contract law determine whether there is a valid agreement to arbitrate." Inland Sea, Inc. v. Castro, 420 S.W.3d 55, 58 (Tex.App.-El Paso 2012, pet. denied).

The elements of a valid contract, including contracts to arbitrate, are (1) an offer, (2) an acceptance, (3) a meeting of the minds, (4) each party's consent to the terms, and (5) execution and delivery of the contract with the intent that it be mutual and binding. Paragon Indus. Applications, Inc. v. Stan Excavating, L.L.C., 432 S.W.3d 542, 547 (Tex.App.-Texarkana 2014, no pet.). "[T]he trial court may summarily decide whether to compel arbitration on the basis of affidavits, pleadings, discovery, and stipulations." Jack B. Anglin Co., Inc. v. Tipps, 842 S.W.2d 266, 269 (Tex. 1992). "However, if the material facts necessary to determine the issue are controverted, by an opposing affidavit or otherwise admissible evidence, the trial court must conduct an evidentiary hearing to determine the disputed material facts." Id.We review the question of whether a valid arbitration exists de novo. In re ReadyOne Industries, Inc., 294 S.W.3d 764, 768 (Tex.App.-El Paso 2009, orig. proceeding) (existence of valid arbitration agreement is a question of law).

STANDARD OF REVIEW ON APPEAL

We review the question of whether a valid arbitration exists de novo. In re ReadyOne Industries, Inc., 294 S.W.3d 764, 768 (Tex.App.-El Paso 2009, orig. proceeding) (existence of valid arbitration agreement is a question of law).

SOURCE: EL PASO COURT OF APPEALS - No. 08-13-00167-CV - 9/17/2014

Federal civil rights violations and statute of limitations

What is the limitations period for Section 1983 and 1985 claims? 

"Although there is no federal statute of limitations for civil rights violations alleged under [section] 1983, `courts construing [section] 1983 "borrow" the forum state's general personal injury limitations period.'" Bell v. Children's Protective Servs., 547 Fed. Appx. 453, 456 (5th Cir. 2013) (quoting Rotella v. Pederson, 144 F.3d 892, 897 (5th Cir. 1998) (internal citations omitted)); Moore v. McDonald, 30 F.3d 616, 620 (5th Cir. 1994); see Prado v. City of Fredericksburg Police Dept., No. A-12-CA-123-LY, 2012 WL 566440, at *2 (W.D. Tex. Feb. 21, 2012), subsequently dism'd, 515 Fed. Appx. 262 (5th Cir. 2013), cert. denied, 134 S. Ct. 218 (U.S. 2013). "While state law determines the statute of limitations, federal law controls when a cause of action accrues, and it begins to run `from the moment the plaintiff becomes aware that he has suffered an injury or has sufficient information to know that he has been injured.'" Bell, 547 Fed. Appx. at 456 (quoting Helton v. Clements, 832 F.2d 332, 334-35 (5th Cir. 1987)). Texas's general personal injury limitations period is two years. Id. (citing TEX. CIV. PRAC. & REM. CODE ANN. § 16.003(a) (West, Westlaw through 2013 3d C.S.)).

Section 1985 of United States Code tile 42 provides a civil remedy to citizens who have been deprived of federally guaranteed rights by conspirators acting under "color of law." Great Am. Fed. Sav. & Loan Ass'n v. Novotny, 442 U.S. 366, 371 (1979); see Taylor v. Anderson, No. A-13-CV-464-LY, 2014 WL 547032, at *3 (W.D. Tex. Feb. 10, 2014). As with civil rights claims brought under section 1983, to determine the applicable statute of limitations period for civil rights actions brought under section 1985, we look to the "general statute of limitations governing personal injuries in the forum state." Price v. City of San Antonio, Tex., 431 F.3d 890, 892 (5th Cir. 2005); Helton v. Clements, 832 F.2d 332, 334 (5th Cir. 1987). Under Texas law, civil rights actions brought under section 1985 "are deemed analogous to Texas tort actions" and are subject to a limitations period of two years. Helton, 832 F.2d at 334; see Anderson, 2014 WL 547032, at *4; see also TEX. CIV. PRAC. & REM. CODE ANN. § 16.003(a).

Section 1986 assesses liability against persons who have knowledge of conspiracies listed in section 1985 and neglect or refuse to prevent such conspiracies. See 42 U.S.C.A. § 1986. Section 1986 claims are subject to a one-year statute of limitations. Id.

SOURCE: Corpus Christi Court of Appeals. - No. 13-13-00378-CV - June 19, 2014

Prevailing party status for attorney fee award purposes

WHEN IS A PARTY A PREVAILING PARTY SO AS TO BE ENTITLED TO HAVE THE OPPONENT PAY HIS OR HER ATTORNEY'S FEES UNDER STATUTE OR CONTRACT? 

Under the American Rule, attorney's fees are recoverable only if authorized by statute or by contract. MBM Fin. Corp. v. Woodlands Operating Co., 292 S.W.3d 660, 669 (Tex. 2009). If authorized by contract, the parties may agree on the standard that will govern the attorney's fee award, even if that standard conflicts with Chapter 38 of the Texas Practice and Remedies Code. Intercontinental Grp. P'ship v. KB Home Lone Star L.P., 295 S.W.3d 650, 653 (Tex. 2009). If the contract provides that attorney's fees will be awarded to the prevailing party, the trial court must determine which party is "prevailing." To prevail, a party "must obtain actual and meaningful relief, something that materially alters the parties' legal relationship." Id. at 652 (citing Farrar v. Hobby, 506 U.S. 103, 111-12 (1992)). More simply, a party prevails when it "prevails upon the court to award it something, either monetary or equitable." Id. at 655.

Did the Defendant "win" (prevail) when the Plaintiff filed a nonsuit? 

In Epps v. Fowler, 351 S.W.3d 862, 869 (Tex. 2011), the Texas Supreme Court construed an attorney's fee provision in a standard real estate contract to determine whether a defendant is a prevailing party when the plaintiff properly nonsuits his claims. Guided by the Fifth Circuit's decision in Dean v. Riser, 240 F.3d 505 (5th Cir. 2001), the Court held that when a plaintiff nonsuits the claims in his lawsuit with prejudice, the defendant is considered the prevailing party because the plaintiff is barred by res judicata from re-asserting the same claims. Epps, 351 S.W.3d at 869.

When the plaintiff nonsuits his claims without prejudice, however, the Court refused to adopt such a per se approach. Id. at 869. The Court noted that a defendant would generally not be a prevailing party when the plaintiff nonsuits without prejudice because the nonsuit "works no such change in the parties' legal relationship; typically, the plaintiff remains free to re-file the same claims seeking the same relief." Id. The Court also observed, however, that "it is logical to conclude that the parties intended to award attorney's fees to compensate the defendant when the plaintiff knowingly pursues a baseless action," id. at 869, and to "`discourage the litigation of frivolous, unreasonable, or groundless claims' when a `calculating plaintiff . . . voluntarily withdraws his complaint' to escape a disfavorable judicial determination on the merits." Id. (quoting Riser, 240 F.3d at 510) (citations omitted). Accordingly, the Court held a defendant may be a prevailing party only "if the trial court determines, on the defendant's motion, that the nonsuit was taken to avoid an unfavorable ruling on the merits." Id. at 870.

The Epps Court provided some guidance to trial courts when determining whether a nonsuit was taken to avoid an unfavorable ruling on the merits. A trial court "should rely as far as possible on the existing records and affidavits, and resort to live testimony only in rare instances." Id. Looking to federal case law, the Court identified the following factors which could support such a determination, including: (1) the timing of a plaintiff's nonsuit when filed only after the defendant files a potentially dispositive motion such as a motion for summary judgment; (2) a plaintiff's unexcused failure to respond to requests for admission or other discovery that could support entry of an adverse judgment; (3) a plaintiff's failure to timely identify experts or other critical witnesses; and (4) the existence of other procedural obstacles, such as the plaintiff's inability to join necessary parties. Id. at 871.

Implied in each of these factors is that the plaintiff's nonsuit was necessary to avoid an unfavorable ruling because the plaintiff's claims were weak or without merit. Indeed, the Epps Court explained that the purpose of the rule was to discourage the plaintiff from pursuing weak claims that should be abandoned and not to penalize a plaintiff for nonsuiting when that is "precisely what should be done". Id. at 869 (citing Riser, 240 F.3d at 510). For instance, a plaintiff who nonsuits only after "discovery reveals previously unknown flaws in the plaintiff's claims" likely has not done so to avoid an unfavorable ruling on the merits. Rather, the decision "may well reflect a legitimate litigation strategy that `reveals nothing about the merits of a plaintiff's case [and thus] does not warrant a conclusion that a defendant in such a case has prevailed . . . .'" Id. at 868 (quoting Riser, 240 F.3d at 510). Accordingly, the Epps Court held that "evidence that the suit was not without merit when filed may indicate that the defendant has not prevailed and is therefore not entitled to attorney's fees." Id. at 871.

SOURCE: SAN ANTONIO COURT OF APPEALS - 04-13-00777-CV - 4/23/2014

CONTRACTUAL OR STATUTORY BASIS FOR ATTORNEY FEE CLAIM REQUIRED 

"As a general rule, litigants in Texas are responsible for their own attorney's fees and expenses in litigation." Ashford Partners, Ltd. v. ECO Res., Inc., 401 S.W.3d 35, 41 (Tex. 2012). "Under Texas law, a court may award attorney's fees only when authorized by statute or by the parties' contract." Peterson Grp., Inc. v. PLTQ Lotus Grp., L.P., 417 S.W.3d 46, 87 (Tex. App.-Houston [1st Dist.] 2013, pet. denied) (citing MBM Fin. Corp. v. Woodlands Operating Co., 292 S.W.3d 660, 669 (Tex. 2009)).

SOURCE: HOUSTON COURT OF APPEALS - 01-13-00855-CV – 12/30/2014

Rule 11 Agreement must be in writing and filed with the court

WHAT REQUIREMENTS DOES A RULE ELEVEN AGREEMENT 
HAVE TO SATISFY TO BE ENFORCEABLE?

A Rule 11 agreement must be in writing and signed and filed with the court unless it is made in open court. See TEX.R.CIV.P. 11. The filing requirement creates the imprimatur of a court record. ExxonMobil Corporation v. Valence Operating Company, 174 S.W.3d 303, 309 (Tex.App.-Houston [1st Dist.] 2005, pet. denied). A settlement agreement must comply with Rule 11 to be enforceable. Padilla v. LaFrance, 907 S.W.2d 454, 460 (Tex. 1995); Broderick v. Kaye Bassman International Corp., 333 S.W.3d 895, 904-05 (Tex.App.-Dallas 2011, no pet.).

Rule Eleven Agreements are named after Rule 11 of the
Texas Rules of Civil Procedure 

While Rule 11 requires the writing to be filed in the court record, it does not say when it must be filed. Padilla, 907 S.W.2d at 461.

WHEN A PARTY CHANGES ITS MIND AFTER SIGNING RULE 11 - REVOCATION OF CONSENT

A party has the right to revoke its consent to a Rule 11 agreement at any time before the rendition of judgment. Quintero v. Jim Walter Homes, Inc., 654 S.W.2d 442, 444 (Tex. 1983). Withdrawal of consent must be effectively communicated to the trial court. Baylor College of Medicine v. Camberg, 247 S.W.3d 342, 346-47 (Tex.App.-Houston [14th Dist.] 2008, pet. denied); First Heights Bank, FSB v. Marom, 934 S.W.2d 843, 845 (Tex.App.-Houston [14th Dist.] 1996, no writ). Ordinarily, when one party withdraws consent to a Rule 11 agreement, another party can still seek to enforce it as a contract through an amended pleading or a counterclaim. Ford Motor Company v. Castillo, 279 S.W.3d 656, 663 (Tex. 2009); Padilla, 907 S.W.2d at 461; see Kanan v. Plantation Homeowner's Association Inc., 407 S.W.3d 320, 334 (Tex.App.-Corpus Christi 2013, no pet.h.)(Where consent to a Rule 11 agreement has been withdrawn, a court may enforce it through a separate breach of contract claim). Generally, these rules are applied in cases where the trial court rendered judgment pursuant to a Rule 11 agreement and one party is claiming that it withdrew its consent to the agreement.

ENFORCEMENT OF RULE 11 AGREEMENT

A trial court has a ministerial duty to enforce a valid Rule 11 agreement. Fortis Benefits v. Cantu, 234 S.W.3d 642, 651 (Tex. 2007); EZ Pawn Corp. v. Mancias, 934 S.W.2d 87, 91 (Tex. 1996); In re Guardianship of White, 329 S.W.3d 591, 592 (Tex.App.-El Paso 2010, no pet.).

Rule 11 agreements are contracts relating to litigation and are subject to general rules of contract construction. Trudy's Texas Star, Inc. v. City of Austin, 307 S.W.3d 894, 914 (Tex.App.-Austin 2010, no pet.). Our primary objective in construing a written contract is to ascertain and give effect to the intentions the parties have objectively manifested in the written instrument. Trudy's Texas Star, 307 S.W.3d at 914, citing Frost National Bank v. L & F Distributors, Ltd., 165 S.W.3d 310, 311-12 (Tex. 2005). Contract terms are given their plain, ordinary, and generally accepted meanings, and contracts are to be construed as a whole in an effort to harmonize and give effect to all provisions of the contract. Trudy's Texas Star, 307 S.W.3d at 914, citing Valence Operating Company v. Dorsett, 164 S.W.3d 656, 663 (Tex. 2005). If a contract can be given a certain or definite legal meaning or interpretation, it is not ambiguous and is construed as a matter of law. Trudy's Texas Star, 307 S.W.3d at 914, citing Coker v. Coker, 650 S.W.2d 391, 393 (Tex. 1983).

SOURCE: EL PASO COURT OF APPEALS -No. 08-13-00069-CV - 4/23/2014 

SIGNATURE REQUIRED - EITHER PARTY OR PARTY'S ATTORNEY, OR BOTH 

Rule 11 provides that "no agreement between attorneys or parties touching any suit pending will be enforced unless it be in writing, signed and filed with the papers as part of the record, or unless it be made in open court and entered of record." TEX. R. CIV. P. 11. A Rule 11 agreement may be signed by attorneys for the parties, or the parties themselves. See TEX. R. CIV. P. 11; see also Ebner v. First State Bank of Smithville, 27 S.W.3d 287, 297 (Tex. App.-Austin 2000, pet. denied) (Rule 11 agreement may be signed by party or party's attorney). Thus, a settlement agreement satisfies the requirements of Rule 11 if it is (1) in writing, (2) signed by the parties or their attorneys, and (3) filed with the court or entered in open court prior to a party seeking enforcement. See TEX. R. CIV. P. 11. 

SOURCE: HOUSTON COURT OF APPEALS - No. 01-13-00176-CV -3/13/2014