I had the privilege and pleasure of speaking to the Dallas Bar Association Appellate Law Section on the subject of superseding judgments in Texas state courts. In connection with that continuing legal education presentation, I prepared a written paper and a powerpoint presentation. I am making those resources publicly available here:
On Thursday, June 16, 2022, at 12:00pm, I have the pleasure of presenting a continuing education program to the Dallas Bar Appellate Law Section at the Arts District Mansion (2101 Ross).
I will be speaking on one of my favorite subjects, superseding judgments in Texas state courts. The presentation will focus on the basics of superseding judgments and will delve into more complex, unanswered issues.
This is an in-person event only and the Dallas Bar Association has applied for an hour of continuing education credit for your attendance.
In the case of a judgment for recovery of an interest in real or personal property, the trial judge must determine the amount of security required to suspend enforcement of the judgment during appeal. Texas Appellate Rule 24.2(a)(2) requires that the amount must be at least
(A) the value of the property interest’s rent or revenue, if the property
interest is real property; or
(B) the value of the property interest on the date when the court rendered
judgment, if the property interest is personal property
A recent opinion from the Corpus Christi Court of Appeals highlights a potential flaw or shortcoming with Rule 24.2(a)(2).
The dispute in Port Isabel Logistical Offshort Terminal, Inc. v. Subsea 7 Port Isabel, LLC, Nos. 13-21-00169-CV & 13-21-00368-CV (Tex. App.–Corpus Christi Mar. 10, 2022, orig. proceeding), related to the termination of Subsea’s leasehold interest kn property owned by Port Isabel Logistical Offshore Terminal (PILOT) and Subsea’s claimed right to retrieve improvements it made to the property.
Following an initial 2017 judgment, PILOT asked the trial court to set an amount required to suspend a portion of the trial court’s judgment ordering that Subsea be allowed to remove improvements from PILOT’s property. The trial court set that amount required at $168.000 and PILOT thereafter posted a cash deposit in that amount.
In the initial appeal, the court of appeals largely affirmed the judgment, but remanded the case to the trial court for entry of a new judgment with recalculated prejudgment interest. While on remand, a further dispute arose as to whether Subsea had waived the right to remove its improvements because of Subsea’s delay in taking action to do so. PILOT expressed its desire to take a further appeal of the trial court’s ruling on the new issue. The trial court signed an order requiring PILOT to post an additional $38,000 to suspend the new judgment allowing Subsea to to remove its improvements. Subsea then filed a motion to further increase the amount of PILOT’s cash deposit, and the trial court ordered that PILOT must post an additional $150,000 to suspend the judgment, thereby bringing the total amount ordered to $350,000.
PILOT filed a motion with the court of appeals seeking review of the trial court’s supersedeas order. PILOT argued that the proper amount for the supersedeas was the value of Subsea’s improvements and Subsea had not shown that the value changed between the time of the trial court’s initial November 2, 2017 order and the trial court’s October 26, 2021 order granting Subsea’s motion to increase the supersedeas amount. The court of appeals rejected PILOT’s challenge to the order, pointing out that Rule 24.2(a)(2) expressly provides that the amount of security must be “at least” the property’s value. The appellate court further observed that the rule does not restrict a trial court from ordering security in excess of the property’s value. Relying on the trial court’s general discretion in this regard, the court of appeals denied PILOT’s motion challenging the trial court’s order.
The court of appeals’ opinion raises the question as to whether there are limits to a trial court’s discretion. In the Port Isabel matter, the amount set for supersedeas was 75% greater than the amount the court had set 4 years earlier. Would the trial court’s discretion have allowed a figure that was 200% greater? Appellate Rule 24.2(b) might allow for a reduction if the judgment debtor (assuming PILOT is a “judgment debtor”) can establish substantial economic harm as a result of having to post the amount set. But the question remains–is a trial court’s discretion over the amount of supersedeas limited or is the sky the limit? Perhaps the limiting principle on the trial court’s discretion is the principle that the supersedeas amount should be an amount sufficient to protect the judgment creditor from any potential harm caused by the stay during the course of the appeal. Clarification of Rule 24.2 may be necessary to avoid inequities and due process problems.
My review of the statistics from the Texas Supreme Court’s dispositions in 2021 brought an assortment of facts to the forefront that are worth highlighting.
- For the second year in a row, the court accepted a significantly higher number of petitions for writ of mandamus.
- As the number of petitions for writ of mandamus reviewed increased significantly, the number of petitions for review granted declined, so that the size of the court’s active docket remained relatively constant.
- The court wrote opinions on a disproportionate number of petitions for review that originated in the Third District Court of Appeals District (Austin), the Fourth District Court of Appeals (San Antonio), and the Fourteenth District Court of Appeals (Houston).
- No petitions for review originating in either the Ninth District Court of Appeals (Beaumont) or the Twelfth District Court of Appeals (Tyler) were disposed of by written opinion.
- 100 percent of the petitions for review granted and originating in the Third District Court of Appeals (Austin) were reversed. In spite of this high reversal rate, the Third District Court of Appeals is tied with the Thirteenth District Court of Appeals for the best affirmance rate of all intermediate courts of appeals over the last 8 years.
- Justice Blacklock authored the highest number of unanimous opinions for the court in 2021.
Parties (and their counsel) to a court of appeals’ disposition of an appeal sometimes worry that if the court disposed of the appeal by issuing a “Memorandum Opinion” instead of an “Opinion,” the chances of obtaining review by the Texas Supreme Court will be diminished. Statistics in recent years have helped to dispel this concern. The statistics for 2021 continue to support the conclusion that the label on the court of appeals’ disposition doesn’t matter insofar as obtaining supreme court review.
During 2021, petitions for review granted and disposed of by the Texas Supreme Court were almost evenly split between those for which the court of appeals issued an “Opinion” (53%) and those for which the court of appeals issued a “Memorandum Opinion” (47%). Keeping in mind that the factors a court of appeals is supposed to use in its determination of what label to put on the written disposition overlap with factors the supreme court uses in deciding what matters are important to the state’s jurisprudence (for purposes of granting a petition), the near-even split between “Opinions” and “Memorandum Opinions” is notable.
The label on the court of appeals opinion didn’t seem to make a difference insofar as the affirmance or reversal by the supreme court. The court reversed 76% of the causes involving a court of appeals “Opinion,” and reversed 73% of the causes involving a court of appeals “Memorandum Opinion.”
Per curiam opinions: I like to track the supreme court’s use of per curiam (unsigned) opinions to see how the court uses that procedural device. The court often uses this device to correct patent errors made by the courts of appeals. Because these opinions are nearly always issued without oral argument, in theory the court expends fewer resources than it would otherwise expend, In 2021, the supreme court reversed the court of appeals in 100% of the causes when the supreme court issued a per curiam opinion upon granting a petition for review. This is the highest reversal rate I have seen for per curiam opinions since I have been tracking this statistic.
I ran the statistics for the Texas Supreme Court’s cause disposition for the calendar year beginning January 1, 2021, through December 31, 2021, and the breakdown of broader statistics is shown below. As with prior years, I will follow up with additional data as I crunch more of the numbers.
- During the 2021 calendar year, the court disposed of 91 causes, consisting of 61 causes taken on petition for review, 28 original proceedings (27 mandamuses and one habeas corpus), and 2 certified questions. The court disposed of 97 causes in 2020, 88 causes in 2019, and 98 causes in 2018.
- Twenty of the causes were disposed of by per curiam opinion (unsigned opinion). This is a decline from last year when the court disposed of 30 causes by per curiam opinion.
- The number of petitions for writ of mandamuses accepted and disposed of rose markedly. In 2020, the court wrote opinions on 12 original proceedings, and that number was an increase over prior years. in 2020, it appeared to me that the increase may have been explained partly by election-year issues. However, this year’s number of original proceedings is more than double the number handled in 2020.
- During 2021, the reversal rate for causes taken on petition for review is 75%, which is about the average.
- As with last year’s numbers, I looked at the number of causes with unanimous opinions. Excluding per curiam opinions, there were 48 unanimous opinions, which includes 9 of 18 mandamuses decided by signed opinion, and 1 of the 2 certified questions was decided by unanimous opinion. Overall, there was some disagreement among the justices in 35.6% of the causes. This disagreement could reflect the changing make-up of the court during the past year.
Final notes on original proceedings: I looked at the substance of the mandamuses that were decided during 2021 to see if I could glean anything from that subject-matter as to why the number of writings on petitions for writ of mandamuses is up. It’s a complete mix of subjects addressed and there does not appear to be any trend or explanation on the face the petitions taken. One potential explanation for the increase could be fall-out from the fact that fewer appeals have been taken during the Covid pandemic since trial courts have been restricted in their operations. With fewer ordinary appeals taken, perhaps the petitions for writ of mandamus simply looked more important to the state’s jurisprudence.
One observation worth noting, however, is that the overall number of causes taken and addressed by the court has remained relatively fixed, which means that as the proportion of petitions for writ of mandamus taken has gone up, the proportion of petitions for review has declined.
Early last year, I wrote about the split among the Texas courts of appeals on whether mandamus relief is available to challenge a trial court’s ruling striking a Section 18.001 counteraffidavit. Civil Practice and Remedies Code Section 18.001 counteraffidavits are used by defendants to contest the reasonableness and necessity of a claimant’s affidavit proof of medical expenses in personal injury cases. The Texas Supreme Court has now resolved the split of authority and held that mandamus relief is available because an appeal is not an adequate remedy since the defendant’s ability to present a viable claim or defense at trial is severely compromised.
In In re Allstate Indemnity Company, No. 20-0071, the trial court’s challenged order excluded the defendant’s damages expert from testifying on any issue and it prohibited the defendant from offering evidence, questioning witnesses, or arguing to the jury about the reasonableness of the plaintiff’s medical expenses. The supreme court wrote that the order was “far from routine.”
The trial court had expressed a number of reasons for striking the defendant’s counteraffidavit. One by one, the supreme court’s opinion addresses each reason provided by the trial court and holds that the trial court erred. Many of the grounds addressed are commonly-used grounds for striking counteraffidavits.
Lack of expertise. The supreme court rejected the trial court’s ruling that the affiant lacked the expertise to controvert the reasonableness of expenses. The record showed that the affiant had extensive education and training in nursing and was a licensed registered nurse. She had 21 years’ experience in healthcare, including 12 years reviewing medical bills. The supreme court expressly rejected the contention that the nurse had to be in the same field of medicine as was reflected by the medical charge in order to attest to reasonableness of the charge.
Lack of “reasonable notice.” The supreme court rejected the conclusion that the counteraffidavit failed to give reasonable notice of the charges that were being contested. The court likened Section 18.001’s “reasonable notice” requirement to the “fair notice” requirement for pleadings. In this case, the court held that the reasonable notice standard was met where the affiant itemized each charge being controverted and compared it to the median charges for the same service in the same time-frame and zip code.
Unreliability. The supreme court held that the trial court abused its discretion by striking the affidavit due to the trial court’s conclusion that the affiant’s opinions were unreliable. The supreme court held that Section 18.001 does not make reliability one of the threshold standards applicable to Section 18.001 counteraffidavits.
Limits on defendant’s evidence at trial. The supreme court also held that the trial court abused its discretion by prohibiting the affiant from testifying at trial and by prohibiting the defendant from questioning the plaintiff’s witnesses, offering evidence, or arguing to the jury about the reasonableness of the plaintiff’s medical bills. The court observed that Section 18.001 is purely procedural and designed to streamline a plaintiff’s proof. The failure of a defendant to file a counteraffidavit under Section 18.001 has no impact on the defendant’s ability to challenge reasonableness and necessity of a plaintiff’s medical expenses at trial. This last holding is consistent with the dissent in the earlier Dallas Court of Appeals case (In re Parks) that I wrote about last year.
Whether a defendant can be sued in the courts of a particular state depends upon the defendant’s presence in the state. If the defendant lives there, or in the case of an entity, has its principal place of business there or is incorporated there, the defendant has availed itself of the state’s jurisdiction and may be sued there. But what if the defendant simply engages in some level of business there? The defendant must have taken some purposeful act by which it availed itself of the privilege of conducting business in the state in order to be subject to suit in the state. The Supreme Court has required that there be some affiliation between the state, the defendant’s activity, and the controversy at hand in the lawsuit. The test recited for this analysis is whether the plaintiff’s claims “arise out of or relate to the defendant’s contacts” with the forum state.
Before last month’s decision in Ford Motor Co. v. Montana Eighth Judicial Dist. Court, No. 19-368, 221 U.S. LEXIS 1610 (Mar. 25, 2021), many courts had described this test as a but-for, causal nexus requirement between the plaintiff’s claims and the defendant’s contacts with the forum state. But in the recent Ford Motor Company opinion, a majority of justices on the U.S. Supreme Court expressed a view of the test that broadens its scope. Writing for herself and four other justices on the court, Justice Kagan wrote that the first half of the standard—arise out of—does indeed ask about causation. However, she wrote that the second half of the standard—relate to—“contemplates that some relationships will support jurisdiction without a causal showing.” She emphasized that the “relate to” standard does impose limits that protect defendant from being hauled into a jurisdiction when there would be no expectation of being sued there.
The facts of the two consolidated cases decided by the opinion in the Ford Motor Company case illustrate how the jurisdiction test now works. Both lawsuits involved auto accidents where a Ford vehicle was being operated. In one case, the plaintiff was driving a Ford Explorer in the state of Montana when the accident occurred. The vehicle had originally been sold in Washington state. It was designed in Michigan and manufactured in Kentucky. Suit was brought against Ford in Montana for design defects, failure to warn, and negligence.
In the other suit, the plaintiff was a passenger in a Crown Victoria when the accident occurred in Minnesota. This vehicle was designed in Michigan, manufactured in Canada, and originally sold in North Dakota. Suit was brought against Ford in Minnesota for design defects, negligence, and breach of warranty.
In each of these suits, if the “arise out of or relate to the defendant’s contacts” test was a but-for, causal analysis, then it is difficult to see how the plaintiffs’ respective claims arise out of or relate to Ford Motor Company’s activities in Montana or Minnesota, given that the design, manufacture, and sale of the vehicles occurred elsewhere. But Ford clearly markets, sells, and services these vehicles all over the country, including Montana and Minnesota. Under Justice Kagan’s expanded view of the “relate to” portion of the test, the plaintiffs’ respective claims can now be said to relate to Ford’s broader activities in Montana and Minnesota, such that Ford may be sued in those states.
Justice Alito concurred in the result, but wrote separately to express his concern that the majority needlessly complicated the analysis by its reinterpretation of “relate to.” He felt that the original “minimum contacts” test espoused in 1945 in International Shoe was sufficiently broad to allow Ford to be sued in Montana and Minnesota.
Justice Gorsuch, joined by Justice Thomas, also concurred in the result, but wrote separately to suggest that the majority was using new words to express old ideas. They suggested that the jurisprudence of personal jurisdiction might need a remake from the top down to bring practical meaning and understanding to it.
The Dallas Court of Appeals has held that the Texas Commission on Human Rights Act (TCHRA) and its prohibition against unlawful employment practices because of sex, encompasses claims for unlawful employment practices because of sexual orientation. This interpretation is the first for an appellate court in Texas and the court’s analysis follows the United States Supreme Court’s holding from last year in Bostock v. Clayton County, Georgia, 140 S. Ct. 1731 (2020).
The procedural posture in Tarrant County College District v. Sims, No. 05-20-00351-CV (Tex. App.—Dallas Mar. 10, 2021, n.p.h.), is a little unusual. Plaintiff Amanda Sims filed suit against her former employer, Tarrant County College District (TCCD), claiming that she was discriminated against because of her sexual orientation, and alleging violations of the Texas Constitution and the Texas Whistleblower Act. TCCD filed a plea to the jurisdiction and sought to dismiss Sims’ claims on the basis of sovereign immunity. TCCD sought dismissal of Sims’ Whistleblower Act claims in part because it contended that the TCHRA provided the exclusive remedy of Sims’ discrimination and anti-retaliation claims. In short, TCCD asserted that the TCHRA is applicable to claims for discrimination based upon sexual orientation. Sims’, however, asserted that the TCHRA did not preempt her claims because she asserted that the TCHRA does not prohibit sexual orientation discrimination.
In TCCD’s appeal of the denial of its plea to the jurisdiction, the Dallas Court of Appeals was presented with the jurisdictional question of whether the TCHRA preempts Sims’ sexual orientation discrimination claims because of the fact that the Act applies to unlawful employment acts “because of sex.” Writing for the court of appeals, Justice Craig Smith noted that the TCHRA was enacted to address workplace discrimination and to conform with federal anti-discrimination and retaliation laws under Title VII of the Civil Rights Act. After noting that the Texas Supreme Court has advised that Texas courts should look to federal law for guidance when the TCHRA and Title VII contain analogous language, the opinion turned to the U.S. Supreme Court’s interpretation of Title VII’s analogous language that was at issue in the Bostock case.
In Bostock, the U.S. Supreme Court observed that while the U.S. Congress likely did not have sexual orientation in mind when it enacted Title VII, the plain wording is controlling such that when an employer fires an individual for being gay or transgender, a violation of the act has occurred. Bostock, 140 S. Ct. at 1737, 1754. The Dallas Court of Appeals concluded that Bostock’s reasoning required that Texas’s law be construed in the same fashion to prohibit discrimination based on an individual’s status as a homosexual or transgender person. Thus, the court held that the TCHRA was applicable and forecloses Sims’ claims for relief under the Texas Whistleblower Act.
Justice Schenck filed a concurring opinion in which he asserted that it was unnecessary for the majority to reach this question because he asserted that the issue had not arisen in an adversarial posture. He further opined that the language of the TCHRA must be construed according to the language in use at the time and the language at the time would not have allowed for the construction given to it by the majority. He further accused the majority of exceeding its role of interpreting the law.
Last year, I reported that the Texas Supreme Court granted a record number of petitions for review in cases where the court of appeals had issued an opinion designated as a “Memorandum Opinion.” The statistics seem to dispel the notion that there is an inherent bias against review of “Memorandum Opinions.
In 2020, the number of petitions granted in cases where the court of appeals had issued a Memorandum Opinion returned to a level in line with prior years reviewed, at 35%. In my view, this is still a hefty number when one considers that Memorandum Opinions (by court rule) are supposed to be reserved for more routine rulings and if the case is routine, it is less likely to be of interest to the Texas Supreme Court.
Cases involving a court of appeals Memorandum Opinion had a higher percentage of reversals (79%) than cases involving a court of appeals Opinion (74%).