Reverse and Render : Texas Appellate Lawyer & Attorney : Cowles & Thompson Law Firm : Court of Appeals, Texas Supreme Court

The Dallas Court of Appeals has held that a trial court did not abuse its discretion by excluding the amount of the judgment appealed from the judgment debtor's net worth calculation for purposes of a supersedeas bond.  What is different from this opinion than from a prior opinion we blogged about is that in this case there was expert testimony on both sides of the issue.

In Anderton v. Cawley, Anderton sought to reduce the amount of supersedeas required of him.  He filed an affidavit of net worth with a negative net worth and showing the amount of the trial court's judgment against him as a liability.  One Appellee objected to the affidavit and a hearing was held to determine the debtor's net worth.  Anderton presented expert testimony showing why the judgment should be treated as a liability under generally accepted accounting principles (GAAP).   The Appellee also presented expert testimony.  Its expert testified that not including the judgment in the net worth calculation is consistent with GAAP.  The trial court rejected inclusion of the judgment as a liability, determining that it would be "illogical" to do so.

On motion to review the trial court's ruling, the court of appeals holds that the trial court did not abuse its discretion in excluding the judgment.  The reasoning for the decision is limited.  The court noted that supersedeas requires calculation of net worth and observed that the statute regarding supersedeas does not include a "contingent money judgment" as a liability.  The court's opinion may be found here.

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In 2007, the Texas Legislature adopted a Certificate of Merit requirement applicable to claims against architects and engineers.  The statutory requirement is much like the expert affidavit requirement applicable to health care liability claims.  The Houston First District Court of Appeals has given us an idea of just how broadly the statute should be interpreted.

In Carter & Burgess Inc. v. Sardari, Sardari brought suit against a contractor--Carter & Burgess--responsible for installing a door in a business in the Houston Galleria after Sardari cut her wrist on the edge of the door.   The trial court denied Carter & Burgess's motion to dismiss, which was based upon Sardari's failure to file a certificate of merit.  Sardari argued that she was not required to file a certificate of merit because the nature of her claim against Carter & Burgess was not based upon its design services, but instead was based upon its actions as a project manager during construction.

Carter & Burgess filed an interlocutory appeal, which is provided as part of the statutory scheme.  The court of appeals reversed and remanded with instructions to the trial court to dismiss.  Civil Practice and Remedies Code Section 150.002(a) requires a certificate of merit in any action (or arbitration) arising out of professional services provided by a licensed or registered professional.  Section 150.001(1) broadly defines "licensed professional" to include "any firm in which such licensed or registered professional practices."  Thus, it would appear that so long as any defendant employs a licensed, practicing architect, engineer, landscape architect, or land surveyor, a certificate of merit is required--even if the person who is the licensed professional has nothing to do with the activity sued over.  The court of appeals expressly rejected Sardari's argument that Carter & Burgess's use of an unlicensed employee to provide the services in question takes the case outside of the statutory requirement.  The court's opinion may be found here.

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Here's one to put in your mandamus file.  The Dallas Court of Appeals has held that the trial court abused its discretion by denying a special exception and that the relators had no adequate remedy by appeal.  Of course, there's more to this holding than meets the eye.

This is a sharolder derivative suit governed by Delaware law.  Delaware law requires a party bringing such an action to first make demand that the board of directors bring suit and refuse to do so, or show that the demand would be futile.  Under Delaware law, the plaintiffs must make a particularized showing in their pleading of the facts relating to this requirement.  The plaintiffs did not do so, and the defendants/relators specially excepted to the pleading.  District Court Judge Martin Hoffman denied the special exceptions.

The court of appeals held that Judge Hoffman abused his discretion by denying the special exceptions.  On appeal, the plaintiffs appear to have tried to provide the specificity that should have been contained in their trial court pleading.  The appellate court rejected the explanations on the merits and also pointed out that the allegations were not contained in the trial court pleading.  Citing the Texas Supreme Court's opinion in In re Schmitz, 285 S.W.3d 451, 459 (Tex. 2009), the court of appeals also held that the relators/defendants did not have an adequate remedy by appeal.  I took a look at Schmitz.  It's a mandamus action from a shareholder deriviative action governed by Texas law.  The Court in that case concluded that the plaintiffs had not complied with the demand requirement before bringing suit, and that the appellate remedy would be inadequate if a shareholder were permitted to sue without complying with the statutory prerequisite demand.

The court of appeals' opinion in In re Brick may be found here.

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