Friday, April 20, 2012

Court of Appeals says it has no mandamus jurisdiction over associate judge

Associate judge's ruling in family/juvenile district court cannot be attacked in the court of appeals.
  
[The 14th Court of Appeals’] mandamus jurisdiction is governed by section 22.221 of the Texas Government Code. Section 22.221 expressly limits the mandamus jurisdiction of the courts of appeals to: (1) writs against a district court judge or county court judge in the court of appeals’ district, and (2) all writs necessary to enforce the court of appeals’ jurisdiction. Tex. Gov’t Code Ann. § 22.221.
We do not have jurisdiction over an associate judge. In re Texas Dept. of Family and Protective Servs., 348 S.W.3d 492, 495 (Tex. App.—Fort Worth 2011, orig. proceeding); In re Reynolds, No. 14-11-00002-CV; 2011 WL 32208 (Tex. App.—Houston [14th Dist.] Jan. 4, 2011, orig. proceeding) (mem. op.).
  
Accordingly, the petition for writ of mandamus is ordered dismissed and relator’s request for stay is denied.

PER CURIAM
SOURCE: fourteenth court of appeals – Houston - 14-12-00342-CV - 4/19/12  [The appellate court does not mention the right to appeal associate judge’s ruling to the presiding judge of the district court.]

Thursday, April 19, 2012

Acceptance of Benefits Doctrine Nixes Appeal in Divorce Case

Acceptance of Benefits of the Judgment precipitates permature end of appeal in divorce case

Houston Court of Appeals dismisses husband’s appeal in divorce case as moot on finding that he accepted some benefits of the divorce decree, and is therefore precluded from appealing others as economic necessity exception found inapplicable.  The scenario involving acceptance of benefits under a judgment or decree that is the subject of a pending appeal represents one of those rare exceptions where the court of appeals can consider evidence (affidavits) that are not part of the appellate record.

THE ACCEPTANCE OF BENEFITS DOCTRINE AS TO JUDGMENTS ON APPEAL

Under the acceptance of the benefits doctrine, “[a] litigant cannot treat a judgment as both right and wrong, and if he has voluntarily accepted the benefits of a judgment, he cannot afterward prosecute an appeal therefrom.”  Carle v. Carle, 234 S.W.2d 1002, 1004 (Tex. 1950).  “The doctrine arises most often in divorce cases in which one spouse accepts certain assets awarded by the judgment and then seeks to appeal the remainder of the judgment.”  Williams v. LifeCare Hosps. of N. Tex., 207 S.W.3d 828, 830 (Tex. App.—Fort Worth 2006, no pet.).  If a party accepts the benefits of a judgment, he is estopped from challenging that judgment on appeal.  Waite v. Waite, 150 S.W.3d 797, 803 (Tex. App.—Houston [14th Dist.] 2004, pet. denied).  In that event, the appeal is rendered moot and must be dismissed.  Harlow Land Co., Ltd. v. City of Melissa, 314 S.W.3d 713, 716 (Tex. App.—Dallas 2010, no pet.).

OPINION ON REHEARING

We originally issued our memorandum opinion in this appeal on December 29, 2011.  Appellant, [“Husband”] substituted for name], has filed a motion for rehearing and motion for en banc reconsideration.  We deny the motion for rehearing, vacate our earlier judgment, withdraw our previous opinion, and issue this opinion in its place.  Accordingly, we dismiss the motion for en banc reconsideration as moot.[1]

Husband appeals from a decree of divorce dissolving the marriage between him and appellee, [“Wife” substituted for name].  In seven issues, appellant argues the trial court erred by (1) characterizing certain property as community property; (2) placing the burden of proof on him to establish certain property claims; (3) awarding Wife certain future income; (4) ordering a lien on his separate property; (5) failing to recognize his economic contribution claim; (6) rescinding its earlier order on a motion for summary judgment; and (7) awarding Wife attorneys’ fees on appeal without awarding him any.  Wife subsequently filed a motion to dismiss under the acceptance of the benefits doctrine.

We dismiss this appeal as moot.

Background

Husband and Wife were married on December 31, 1999.  Wife filed for divorce on January 22, 2008, and Husband counter-filed on March 4.  Following a trial, the trial court rendered its final decree of divorce on September 10, 2009.  In dividing the marital estate, the trial court determined five boats were community property and awarded them to Husband.

On January 5, 2010, the trial court held a hearing on Wife’s motion for temporary orders pending appeal.  At that hearing, Husband testified that he had sold two boats: a 39-foot 2002 Mainship and a 29-foot 1994 Proline.  He also testified that a third boat—a 34-foot 1999 Navigator Baywatch—was under a contract for sale, which was being paid in monthly installments.  Husband stated he had used the proceeds of the sales to pay down a loan, pay bills, and put into his business.  Based on this testimony, Wife filed a motion to dismiss under the acceptance of the benefits doctrine.  We issued an order stating the motion would be carried with the case.

Acceptance of Benefits of Judgment

Under the acceptance of the benefits doctrine, “[a] litigant cannot treat a judgment as both right and wrong, and if he has voluntarily accepted the benefits of a judgment, he cannot afterward prosecute an appeal therefrom.”  Carle v. Carle, 234 S.W.2d 1002, 1004 (Tex. 1950).  “The doctrine arises most often in divorce cases in which one spouse accepts certain assets awarded by the judgment and then seeks to appeal the remainder of the judgment.”  Williams v. LifeCare Hosps. of N. Tex., 207 S.W.3d 828, 830 (Tex. App.—Fort Worth 2006, no pet.).  If a party accepts the benefits of a judgment, he is estopped from challenging that judgment on appeal.  Waite v. Waite, 150 S.W.3d 797, 803 (Tex. App.—Houston [14th Dist.] 2004, pet. denied).  In that event, the appeal is rendered moot and must be dismissed.  Harlow Land Co., Ltd. v. City of Melissa, 314 S.W.3d 713, 716 (Tex. App.—Dallas 2010, no pet.).

The appellee bears the burden of proof to establish application of the acceptance of the benefits doctrine.  Waite, 150 S.W.3d at 803.  The parties may rely on affidavits and other satisfactory evidence to establish whether the appellate court retains jurisdiction over the appeal.  See Tex. Gov’t Code Ann. § 22.220(c) (Vernon Supp. 2011) (appellate courts may consider affidavits and other evidence to determine proper exercise of its jurisdiction); Tex. R. App. P. 10.2 (requiring inclusion of affidavits and other satisfactory evidence with motions in certain circumstances); Twin City Fire Ins. Co. v. Jones, 834 S.W.2d 114, 116 (Tex. App.—Houston [1st Dist.] 1992, writ denied) (holding appellate court can consider affidavits and other evidence in determining motion to dismiss).

An appellant may avoid the application of the acceptance of the benefits doctrine by showing the application of either of two exceptions: (1) acceptance of the benefits of the judgment was a result of financial duress or other economic circumstances or (2) reversal of the judgment on the grounds appealed could not possibly affect the appellant’s right to benefits accepted.  Williams, 207 S.W.3d at 830; Waite, 150 S.W.3d at 803–04.  These exceptions are narrow.  Waite, 150 S.W.3d at 804.  The appellant bears the burden of establishing the application of the exceptions.  See id. (holding “unless [appellant] satisfies an exception to the acceptance of the benefits doctrine or otherwise shows that it does not apply, we must agree with [appellee] that [appellant]’s actions in accepting a substantial portion of the judgment bars him from appealing that same judgment he now attacks”); Smith v. Tex. Commerce Bank-Corpus Christi, N.A., 822 S.W.2d 812, 814 (Tex. App.—Corpus Christi 1992, writ denied) (holding appellant failed to establish application of exception and, accordingly, appellant was estopped from challenging judgment on appeal); see also Williams, 207 S.W.3d at 830–32 (considering appellant’s arguments for the application of exceptions as opposed to appellee’s arguments against their application).

To meet her burden of showing that Husband has accepted the benefits of the judgment, Wife cites to Husband’s testimony from the hearing on Wife’s motion for temporary orders pending appeal.  At that hearing, Husband testified that he had sold two boats that had been awarded to him from the community estate: the Mainship and the Proline.  A third boat awarded to him from the community estate—the Navigator Baywatch—was under contract for sale and was being paid in monthly installments.  We hold that Wife met her burden of establishing Husband had accepted the benefits of the judgment.  See Waite, 150 S.W.3d at 804 (holding taking possession of community funds and filing deed transferring wife’s interest in home to husband is sufficient to establish acceptance of benefits of judgment).

Husband does not dispute that he has accepted the benefits of the judgment.  Instead, he argues the sale of the boats was an economic necessity.  At the hearing, he described his financial situation as “almost bankruptcy” and that his expenses were greater than what he brought in.  While he provided some examples of how he was losing income on his rental properties, Husband did not provide a detailed explanation—through testimony or exhibits—of what his monthly income and expenses were. 

Husband also cites to his affidavit attached to the response to Wife’s motion for support for his claim that he was in dire financial straits.  The only mention in his affidavit of his economic condition, however, is his attempt to explain why he could not sell the separate property Wife identified and why he had to sell the boats at the time that he did.  His explanation for why he had to sell the boats was his assertion that the market for boats was crashing and the cost of maintaining them were outweighing their value.  Husband does not otherwise provide any proof of his monthly income and monthly expenditures.

In the body of his response to Wife’s motion, Husband asserts without support that the net value of the community (which he defines as assets awarded less debts apportioned) awarded to him is negative $142,063 while the amount awarded to Wife is positive $318,672.  In his brief on the merits, Husband presents a table of calculations reaching the same numbers.  This table, however, is based on the assumption that the trial court mischaracterized certain property as community instead of separate.  Without this assumption—that is, as reflected currently in the judgment—Husband acknowledges his share of the community property is positive $711,502.

In Waite, the appellant asserted in an affidavit that he had to take the money awarded to him from the court registry because he needed to pay daily living expenses and to complete repairs on his home, which had been designated as his separate property.  150 S.W.3d at 805.  He also asserted that the tax refund awarded to him was only a return of money he had advanced as a result of an accounting error and that he had not sold or encumbered the home that he had taken possession of and filed a lien establishing he was the sole owner.  Id.  The court held that the appellant’s affidavit did not support his claim of economic necessity because it was largely conclusory.  Id.  The court observed that the appellant had offered few specifics to support his initial contention that he needed the money awarded to him to pay his daily living expenses, stating only that he had to pay for such things as food, clothing, rent, and insurance.  Id.  Nor had he presented any proof of what his other assets or sources of income were.  Id. at 805–06.  The court held that the appellant had failed to show that he accepted the benefits because of economic necessity and granted the motion to dismiss.  Id. at 808.

In contrast, the appellant in Garza provided detailed information of what her monthly income was as well as what her monthly expenditures were.   Garza v. Garza, 155 S.W.3d 471, 473 (Tex. App.—San Antonio 2004, no pet.).  She also established that she did not have other assets that could be sold or other sources of income.  Id. at 474.  Based on the detailed information provided, the appellate court determined that the appellant’s use of the payments for her equity interest in the marital homestead was an economic necessity.  Id. at 475.

We determine this case is similar to Waites.  Husband does not provide any detailed explanation of his economic circumstances.  Instead, he provides a mostly conclusory assertion that he is near bankruptcy and that his expenses were greater than his income.  While some information is present, it is not enough to determine, with any degree of certainty, what his monthly income and obligations are.  Accordingly, Husband has failed to establish he falls in the narrow exception of economic necessity.

Moreover, we note that Husband’s explanation for why he had to sell the community-property boats is at odds with why he could not sell his separate-property real estate.  In his response to Wife’s motion to dismiss, Husband argues he had to sell the boats because (1) he was incurring costly monthly expenses, including insurance and monthly maintenance and (2) the market value of the boats was decreasing due to the economy.  He simultaneously argues that he could not sell his rental properties because he would “suffer[] a loss in the current depressed real estate market” despite the fact that he was incurring costly monthly expenses, including insurance and monthly maintenance.  He backed up both of these arguments by relying on testimony presented to the trial court at the hearing on Wife’s motion for temporary orders pending appeal.  Jim acknowledged that he had lost two of his nine commercial real estate tenants, that he would have to incur further expenses by their loss, including bills and maintenance fees that those tenants otherwise would have paid and advertising fees to find a new tenant.  As Husband explained during the hearing, “With our economy the way it is, I expect a long dry spell.”

Additionally, Husband offers no explanation for how the declining value of the boats or the real estate along with their attendant costs was not known to him prior to the decree of divorce or why he could not have sought accommodations—either from Wife or from the trial court—to sell the community property prior to the decree of divorce.

Husband also argues that the trial court’s unequal division of the community estate is enough to establish economic necessity.  He relies on Smith v. Smith, 143 S.W.3d 206 (Tex. App.—Waco 2004, no pet.) as authority for his argument.  In Smith, the appellant withdrew from the court registry money awarded to her from the community estate.  Id. at 212. In that case, the trial court determined that the appellant had no separate property and awarded her a portion of the community property that was less than or equal to the obligations assigned to her.  Id. at 211, 212.  The court concluded that the appellant fell within the exception of economic necessity.  Id. at 212.

Even if we were to adopt the holding of Smith, it is unavailing.  As we have noted, Husband provides no support for his assertion that his award of the community property coupled with his assignment of obligations is a negative amount.  The calculation in his brief on the merits that reflects this amount is based on the assumption that this Court will agree with his argument on the merits that the trial court mischaracterized certain property as community instead of his separate property.  Even if Husbandprevailed on this point, however, the property would still be his; it would just be characterized as separate property instead of community.  Accordingly, adding the value of all of his assets and obligations, he still has a positive net worth.  Based on his own calculations in his brief on the merits, it is a net worth in excess of $700,000.  In contrast, the appellant in Smith had no separate property and was left with only a negative net worth.  Id. at 211, 212.  Complaining of receiving a negative combined amount of community assets and joint obligations, by itself, does not establish economic necessity.

Conclusion

Wife established that Husband accepted the benefits of the judgment.  Husband has failed to establish that he falls within the narrow exception of economic necessity.  Accordingly, we grant Wife’s motion and dismiss the appeal as moot.

                                                                      Laura Carter Higley

                                                                      Justice

Panel consists of Justices Keyes, Higley, and Massengale.

SOURCE: HOUSTON COURT OF APPEALS - 01-09-01066-CV – 4/19/12 

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[1]         See Brookshire Bros., Inc. v. Smith, 176 S.W.3d 30, 40 n.2 (Tex. App.—Houston [1st Dist.] 2004, pet. denied).


Suit complaining of overcharges for gas properly dismissed on jurisdictional grounds (Tara Partners v. CenterPoint Energy)

   
Billing dispute over gas requires administrative complaint
  
First Court of Appeals affirms dismissal of commercial customer's suit seeking recovery of alleged overcharges for failure to exhaust administrative remedies as provided for by the Gas Utility Regulatory Act (“GURA”).
      
Tara Partners, Ltd v. CenterPoint Energy Resources Corp. (Tex.App- Houston [1st Dist.] April 19, 2012)  

O P I N I O N
  
          Appellant, Tara Partners, Ltd. (“Tara Partners”), challenges the trial court’s dismissal without prejudice of its suit pursuant to the plea to the jurisdiction of appellee, CenterPoint Energy Resources Corp. (“CenterPoint”).  In its sole issue on appeal, Tara Partners argues that the trial court erred in granting CenterPoint’s plea to the jurisdiction and in dismissing its case.
          We affirm.
Background

Tara Partners sued “CenterPoint Energy” for breach of contract, alleging that CenterPoint had billed Tara Partners for more natural gas than it actually used.  Specifically, Tara Partners argued that CenterPoint “has materially breached . . . contractual arrangements . . . because [it] has, with respect to substantial portions of the period ranging from November 2009 through February 2010, invoiced [Tara Partners] for the price of more cubic feet of natural gas than [Tara Partners] actually consumed.”  Tara Partners requested that the trial court “retroactively correct [CenterPoint’s] bills for natural gas” and award it damages in the amount it was required to overpay.

CenterPoint Energy, Inc. filed a plea to the jurisdiction and a verified denial asserting that it was not liable in the capacity alleged by Tara Partners.  Tara Partners subsequently amended its pleading to add appellee, CenterPoint, as a defendant, and it non-suited CenterPoint Energy, Inc.

CenterPoint filed its own plea to the jurisdiction, arguing that the trial court lacked jurisdiction over the case because the Texas Utilities Code has established a regulatory scheme that confers exclusive jurisdiction for claims regarding rate disputes and refunds for overcharges on the Texas Railroad Commission or on the municipality involved.  See Tex. Util. Code Ann. §§ 101.001–105.051 (Vernon 2007 & Supp. 2011). 

Tara Partners responded, arguing that, because its suit is based on a private contract, no administrative regulation of natural gas rates and services applies to its claim.  It also stated that it attempted to file a complaint with the Texas Railroad Commission, which dismissed the complaint.  Tara Partners attached the letter it received from the Railroad Commission.  The letter provided that it was in reference to the “Request for an Informal Complaint by Small Commercial Customer Tara Partners, Ltd. Against CenterPoint Energy.”  The letter stated that Tara Partners’ complaint, which it determined involved a billing dispute, “is not subject to the informal complaint process, which is reserved for complaints over natural gas transmission discrimination issues.”  The letter further stated that “consumer bill complaints [are handled] through the Market Oversight Section’s consumer complaint function,” but it concluded, “Since the dispute is the subject of a lawsuit, the matter has proceeded beyond this Division’s ability to facilitate a resolution.”

The trial court granted CenterPoint’s plea to the jurisdiction and dismissed Tara Partners’ claims without prejudice.  This appeal followed.

Analysis

In its sole issue, Tara Partners argues that the trial court erred in granting CenterPoint’s plea to the jurisdiction.



A.                         Standard of Review



Subject-matter jurisdiction is essential to the authority of a court to decide a case.  Tex. Ass’n of Bus. v. Tex. Air Control Bd., 852 S.W.2d 440, 443 (Tex. 1993).  The plaintiff bears the burden of alleging facts affirmatively showing that the trial court has subject-matter jurisdiction.  Id. at 446.  The absence of subject-matter jurisdiction may be raised by a plea to the jurisdiction.  Bland Indep. Sch. Dist. v. Blue, 34 S.W.3d 547, 554 (Tex. 2000).



Whether a trial court has subject-matter jurisdiction is a question of law and is reviewed de novo.  See Mayhew v. Sunnyvale, 964 S.W.2d 922, 928 (Tex. 1998).  When conducting a de novo review, the appellate court exercises its own judgment and redetermines each legal issue, giving no deference to the trial court’s decision.  Quick v. City of Austin, 7 S.W.3d 109, 116 (Tex. 1998).



In deciding a plea to the jurisdiction, a court may not weigh the claims’ merits, but must consider only the plaintiff’s pleadings and the evidence pertinent to the jurisdictional inquiry.  Cnty. of Cameron v. Brown, 80 S.W.3d 549, 555 (Tex. 2002).  The court of appeals must take the allegations in the petition as true and construe them in favor of the pleader.  Tex. Ass’n of Bus., 852 S.W.2d at 446.



CenterPoint asserts that the City of Houston, as the municipality where Tara Partners’ gas service is provided, and/or the Texas Railroad Commission have exclusive jurisdiction.  “An agency has exclusive jurisdiction when the Legislature has granted that agency the sole authority to make an initial determination in a dispute.”  In re Entergy Corp., 142 S.W.3d 316, 321 (Tex. 2004) (orig. proceeding) (citing Subaru of Am. Inc. v. David McDavid Nissan, Inc., 84 S.W.3d 212, 221 (Tex. 2002) and Cash Am. Int’l, Inc. v. Bennett, 35 S.W.3d 12, 18 (Tex. 2000)).  If an agency has exclusive jurisdiction, a party must exhaust all administrative remedies before seeking review of the agency’s action, and, until the party has done so, the trial court lacks subject-matter jurisdiction and must dismiss any claim within the agency’s exclusive jurisdiction.  Id. at 321–22.  Whether an agency has exclusive jurisdiction is a question of law we review de novo.  See id. at 322; David McDavid Nissan, 84 S.W.3d at 222.



B.                         Analysis



As Tara Partners argues, there is a constitutional presumption that district courts are authorized to resolve disputes.  See In re Entergy Corp., 142 S.W.3d at 322 (citing Tex. Const. art. V, § 8).  We also observe that administrative agencies “may exercise only those powers the law confers upon them in clear and express statutory language and those reasonably necessary to fulfill a function or perform a duty that the Legislature has expressly placed with the agency.”  Id.  Thus, we must determine whether, as CenterPoint argues, “the ‘Constitution or other law’ conveys exclusive, appellate, or original jurisdiction on another court or administrative agency.”  See id.  Whether the Texas Railroad Commission and/or the City of Houston has exclusive jurisdiction over Tara Partners’ claim depends on statutory interpretation.  See id. (citing David McDavid Nissan, 84 S.W.3d at 221). 



“An agency has exclusive jurisdiction ‘when a pervasive regulatory scheme indicates that Congress intended for the regulatory process to be the exclusive means of remedying the problem to which the regulation is addressed.’”  Id. (quoting David McDavid Nissan, 84 S.W.3d at 221).  When construing a statute, our objective is to determine and give effect to the Legislature’s intent.  Id. (citing City of San Antonio v. City of Boerne, 111 S.W.3d 22, 25 (Tex. 2003)).  We look to the plain and common meaning of the statute’s words, and when the statute’s meaning is unambiguous, we interpret that statute according to its plain language.  Id. (quoting State v. Gonzalez, 82 S.W.3d 322, 327 (Tex. 2002)).



The legislature enacted the Gas Utility Regulatory Act (“GURA”) “to establish a comprehensive and adequate regulatory system for gas utilities to assure rates, operations, and services that are just and reasonable to the consumers and to the utilities.”  See Tex. Util. Code Ann. §§ 101.001–.002 (Vernon 2007) (“Gas utilities are by definition monopolies in the areas they serve. . . .  Public agencies regulate utility rates, operations, and services as a substitute for competition.”).  GURA provides:



(a)  The railroad commission has exclusive original jurisdiction over the rates and services of a gas utility:







   (1) that distributes natural gas or synthetic natural gas in:



               (A)       areas outside a municipality; and



(B)       areas inside a municipality that surrenders its jurisdiction to the railroad commission under Section 103.003; and



(2) that transmits, transports, delivers, or sells natural gas or synthetic natural gas to a gas utility that distributes the gas to the public.



(b)  The railroad commission has exclusive appellate jurisdiction to review an order or ordinance of a municipality exercising exclusive original jurisdiction as provided by this subtitle.



Id. § 102.001 (Vernon 2007).



          Regarding the jurisdiction of a municipality, GURA provides:



To provide fair, just, and reasonable rates and adequate and efficient services, the governing body of a municipality has exclusive original jurisdiction over the rates, operations, and services of a gas utility within the municipality, subject to the limitations imposed by this subtitle,[1] unless the municipality surrenders its jurisdiction to the railroad commission under Section 103.003.



Id. § 103.001 (Vernon 2007).



          GURA defines “gas utility” as including “a person or river authority that owns or operates for compensation in this state equipment or facilities to transmit or distribute combustible hydrocarbon natural gas or synthetic natural gas for sale or resale in a manner not subject to the jurisdiction of the Federal Energy Regulatory Commission under the Natural Gas Act (15 U.S.C. Section 717 et seq.). . . .”  Id. § 101.003(7) (Vernon Supp. 2011).  A “person” includes “an individual, a partnership of two or more persons having a joint or common interest, a mutual or cooperative association, a limited liability company, and a corporation.”  Id. § 101.003(10).  A “rate” is defined as:



(A)                        any compensation, tariff, charge, fare, toll, rental, or classification that is directly or indirectly demanded, observed, charged, or collected by a gas utility for a service, product, or commodity described in the definition of gas utility in this section; and



(B)                         a rule, regulation, practice, or contract affecting the compensation, tariff, charge, fare, toll, rental, or classification.



Id. § 101.003(12).  Finally, GURA provides that “service”



has its broadest and most inclusive meaning.  The term includes any act performed, anything supplied, and any facilities used or supplied by a gas utility in the performance of the utility's duties under this subtitle to its patrons, employees, other gas utilities, and the public.  The term also includes the interchange of facilities between two or more gas utilities.







Id. § 101.003(14). 



          The statutory description of GURA as “comprehensive” demonstrates the Legislature’s intent that GURA encompass all or virtually all pertinent considerations involving gas utilities operating in Texas.  See id. §§ 101.001–.002; cf. In re Entergy Corp., 142 S.W.3d at 323 (construing essentially identical language of the Public Utility Regulatory Act (“PURA”)).[2]  Furthermore, sections 102.001 and 103.001 grant “exclusive original jurisdiction” over the rates and services to the municipality or to the Railroad Commission when no municipality is involved.  See Tex. Util. Code Ann. §§ 102.001, 103.001. 



Tara Partners’ dispute involves the amount it was billed for natural gas provided by CenterPoint.  CenterPoint is a corporation “that owns or operates for compensation in this state equipment or facilities to transmit or distribute combustible hydrocarbon natural gas or synthetic natural gas for sale,” and, thus, it is a “gas utility” as defined by GURA.  See id. §§ 101.003(7), (10).  A “rate” includes any charge demanded or collected by a gas utility “for a service, product, or commodity described in the definition of gas utility,” including a “practice[] or contract affecting the compensation, tariff, charge, fare, toll, rental, or classification.”  See id. § 101.003(12); see also id. § 101.003(14) (giving “service” its “broadest and most inclusive meaning,” including “anything supplied” by gas utility “in the performance of the utility’s duties under this subtitle to its patrons”).  Thus, Tara Partners’ claim that CenterPoint incorrectly charged it for natural gas falls under the statutory definitions of “rate” or “service” over which the municipality or Railroad Commission has exclusive original jurisdiction.  See id. §§ 102.001, 103.001; cf. In re Entergy Corp., 142 S.W.3d at 323–24 (construing essentially identical language of PURA and concluding that Legislature expressed clear intention that Public Utility Commission have exclusive jurisdiction over dispute between Entergy and ratepayers).[3]



Because the municipality—or, in the event that the municipality has surrendered its jurisdiction, the Railroad Commission—has exclusive jurisdiction over this claim, Tara Partners was required to exhaust all administrative remedies before seeking review of the agency’s action in the district court.  See In re Entergy Corp., 142 S.W.3d at 321.  It is undisputed that Tara Partners has not pursued its claim with the municipality, nor has it pursued any appeal to the Railroad Commission;[4] thus, the trial court lacks subject-matter jurisdiction and properly dismissed Tara Partners’ claim.  See id. at 321–22.



Tara Partners argues that GURA does not apply to its claim because it is suing for breach of a private contract.  However, the plain language of GURA defines a “rate” over which the municipality or Railroad Commission has exclusive original jurisdiction as including a “contract affecting the compensation, tariff, charge, fare, toll, rental, or classification” charged by a gas utility.  See Tex. Util. Code Ann. § 101.003(12). 



Tara Partners argues that the Texas Supreme Court considered a city’s breach of contract lawsuit against a gas utility “without remarking upon the absence of subject matter jurisdiction.”  See S. Union Co. v. City of Edinburg, 129 S.W.3d 74, 76–77 (Tex. 2003).  However, Southern Union actually addressed the question of whether “gas purchased by consumers within the City from companies affiliated with [the gas utilities] is subject to the 4% franchise tax under [an applicable city ordinance],” and the gas sales at issue were “direct sales” made by unregulated “special marketing companies.”  Id. at 76.  Thus, this case is distinguishable from the present case. 



We further disagree with Tara Partners’ assertion that In re Entergy Corp. “should be understood as contemplating that private contractual disputes between private parties and utilities can be maintained as original actions . . . commenced in the state district courts.”  The Texas Supreme Court rejected the plaintiff’s argument that the dispute involved a private contract and did not fall under the exclusive original jurisdiction provision in PURA.  In re Entergy Corp., 142 S.W.3d at 323–24.  The supreme court held that the agreement at issue “affected the public interest and, more importantly, was the basis for the [Public Utility Commission’s] regulatory approval of” Entergy’s merger with another entity and was implemented by an order of the Public Utility Commission.  See id. at 324.  Here, as we have already held, the plain language of GURA provides that contracts affecting charges by a gas utility are considered “rates” over which the municipality or Railroad Commission has exclusive original jurisdiction, and Tara Partners’ claim falls within the stated purpose of GURA’s regulations.  See Tex. Util. Code Ann. § 101.003(12) (defining “rate”); id. § 103.001 (“To provide fair, just, and reasonable rates and adequate and efficient services, the governing body of a municipality has exclusive original jurisdiction over the rates, operations, and services of a gas utility within the municipality. . . .”); see also In re Entergy Corp., 142 S.W.3d at 322 (“An agency has exclusive jurisdiction ‘when a pervasive regulatory scheme indicates that Congress intended for the regulatory process to be the exclusive means of remedying the problem to which the regulation is addressed.’”).



Thus, we conclude that the trial court lacked subject-matter jurisdiction over this claim, and its dismissal of the suit without prejudice was proper.

Conclusion

We affirm the order of the trial court dismissing Tara Partner’s suit.

                                                                    Evelyn V. Keyes
                                                                   Justice

Panel consists of Justices Keyes, Bland, and Sharp.

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[1]           GURA further provides that the administrative decisions of a municipality are appealable to the Texas Railroad Commission and that decisions of the Railroad Commission are subject to judicial review.  See Tex. Util. Code Ann. § 103.024 (Vernon 2007) (providing that municipality is entitled to judicial review of certain decisions of Railroad Commission); id. §§ 103.051–.053 (Vernon 2007) (providing for appeal of municipality decisions to Railroad Commission); id. § 105.001 (Vernon 2007) (providing right to judicial review of decisions of Railroad Commission).

 [2]           As analyzed by the Texas Supreme Court in In re Entergy Corp., PURA provides that its purpose is “to establish a comprehensive and adequate regulatory system for electric utilities to assure rates, operations, and services that are just and reasonable to the consumers and to the electric utilities.”  In re Entergy Corp., 142 S.W.3d 316, 323 (Tex. 2004) (orig. proceeding) (quoting Tex. Util. Code Ann. § 31.001(a) (Vernon 2007)).

 [3]           As analyzed by the Texas Supreme Court in In re Entergy Corp., PURA provides that the Public Utility Commission has “exclusive original jurisdiction over the rates, operations, and services of an electric utility in (1) areas outside a municipality; and (2) areas inside a municipality that surrenders its jurisdiction to the Commission under Section 33.002.”  In re Entergy Corp., 142 S.W.3d at 323 (quoting Tex. Util. Code Ann. § 32.001 (Vernon 2007)).

 [4]           After the trial court’s plenary power expired, Tara Partners filed a second letter from the Railroad Commission informing it that “[t]he Commission does not handle this type of complaint through the Commission’s informal complaint process” and that “[t]he City of Houston has original jurisdiction in setting rates and handling quality of service issues for gas utilities within the city limits.”  We note that this letter does not create a fact issue regarding whether Tara Partners has exhausted its administrative remedies, because it remains undisputed that Tara Partners has not attempted to pursue its claim with the applicable municipality.  See Tex. Util. Code Ann. § 103.001 (Vernon 2007) (providing that governing body of municipality has exclusive original jurisdiction over rates, operations, and services of gas utility within municipality). 


Tuesday, April 17, 2012

Tex. CPRC §16.064 - Sixty-day extension of limitations bar when suit originally filed in court without jurisdiction

Houston Court of Appeals says 60-day window to re-file dismissed action in proper court available when dismissed in original court for want of (personal) jurisdiction even if statute of repose  (rather than statute of limitations) had since expired, but first suit had been timely filed. See Tex. Civ. Prac. & Rem. Code Ann. § 16.064. One justice on the three-member panel dissented.

The clock just keeps ticking ...

Whittington v. Nathan
No. 01-10-00971-CV (Tex.App. – Houston [1st Dist.] April 12, 2012, no pet. h.)

O P I N I O N

Appellant, Stephen Whittington, challenges the trial court’s rendition of summary judgment in favor of appellee, Marc H. Nathan, in Whittington’s suit against Nathan for violations of the Uniform Fraudulent Transfer Act (“UFTA”).[1]  In his sole issue, Whittington contends that the trial court erred in granting Nathan summary judgment on the ground that Whittington had not timely filed his UFTA action under its four-year statute of repose.[2]

We reverse and remand.

Background

          In June 2006, Whittington obtained a $3.2 million judgment against his former business associate, Evan Baergen, in a Nevada court.  Unable to collect on his judgment, Whittington, in May 2008, brought his UFTA action against Baergen and Nathan in a Nevada court, seeking to recover assets that Baergen had allegedly fraudulently transferred to Nathan.  It is undisputed that Whittington asserted his UFTA claims in Nevada within UFTA’s four-year statute of repose.  However, the Nevada court ultimately dismissed Whittington’s UFTA action for lack of personal jurisdiction.  And Whittington, within sixty days of this dismissal, filed the instant suit against Nathan for violations of UFTA based upon the same allegations that he had made in the Nevada action.  

Nathan sought summary judgment on the ground that a cause of action under UFTA is extinguished unless it is brought within the prescribed period—here, four years.[3]   In his response, Whittington argued that he had timely brought the instant UFTA action because he had originally filed the action in Nevada before the expiration of the four-year statute of repose and he had, in accord with the applicable “savings statute” in the Texas Civil Practice and Remedies Code,[4] filed the UFTA action in Texas within 60 days of the Nevada court’s dismissal.

Standard of Review

To prevail on a summary-judgment motion, a movant has the burden of proving that he is entitled to judgment as a matter of law and there is no genuine issue of material fact.  Tex. R.  Civ. P. 166a(c); Cathey v. Booth, 900 S.W.2d 339, 341 (Tex. 1995).  When a defendant moves for summary judgment, he must either (1) disprove at least one essential element of the plaintiff’s cause of action or (2) plead and conclusively establish each essential element of an affirmative defense, thereby defeating the plaintiff’s cause of action.  Cathey, 900 S.W.2d at 341.  When deciding whether there is a disputed, material fact issue precluding summary judgment, evidence favorable to the non-movant will be taken as true.  Nixon v. Mr. Prop. Mgmt. Co., 690 S.W.2d 546, 548–49 (Tex. 1985).  Every reasonable inference must be indulged in favor of the non-movant and any doubts must be resolved in his favor.  Id. at 549.

We review the trial court’s interpretation of a statute de novo.  See Johnson v. City of Forth Worth, 774 S.W.2d 653, 655–56 (Tex. 1989). In construing a statute, our objective is to determine and give effect to the Legislature’s intent.  See Nat’l Liab. & Fire Ins. Co. v. Allen, 15 S.W.3d 525, 527 (Tex. 2000).

Suspension of Statues of Limitations and Repose

In his sole issue, Whittington argues that the trial court erred in granting Nathan summary judgment because he timely filed the instant UFTA action in Texas within 60 days of the Nevada court’s dismissal, for lack of personal jurisdiction, of his same claims against Nathan.  See Tex. Civ. Prac. & Rem. Code Ann. § 16.064 (Vernon 2008).   Thus, he concludes that UFTA’s four-year statute of repose did not extinguish his claims.   

Section 16.064, entitled “Effect of Lack of Jurisdiction,” provides that the period between the date of filing an action in one court and “the date of a second filing of the same action in a different court suspends the running of the applicable statute of limitations for the period” if:

(1)     because of lack of jurisdiction in the trial court where the action was first filed, the action is dismissed or the judgment is set aside or annulled in a direct proceeding; and

(2)     not later than the 60th day after the date the dismissal or other disposition becomes final, the action is commenced in a court of proper jurisdiction. 

Id. § 16.064(a).  The “remedial purpose” of section 16.064 is to provide relief “to one who has mistakenly brought his action in the wrong court.”  Clary Corp. v. Smith, 949 S.W.2d 452, 461 (Tex. App.—Fort Worth 1997, writ denied) (citation omitted).

Here, Whittington, timely, within UFTA’s four-year statute of repose, sued Nathan in a Nevada court for violations of UFTA, but the Nevada district court dismissed the action for lack of personal jurisdiction.  Whittington then, within 60 days of the dismissal, in compliance with section 16.064, made his second filing of the same UFTA action in the trial court below.  Nevertheless, the trial court, apparently concluding that Whittington cannot rely upon section 16.064 to suspend the running of UFTA’s statute of “repose” because it is not a statute of “limitation,” granted Nathan summary judgment on the ground that Whittington had untimely filed his UFTA action in Texas. 

Nathan’s argument that section 16.064 does not apply in the instant case to suspend the running of UFTA’s statute of repose is based, in large part, upon his interpretation of the Texas Supreme Court’s opinion in Galbraith Engineering Consultants v. Pochucha, 290 S.W.3d 863 (Tex. 2009).  In Galbraith, the supreme court concluded that the Texas Legislature did not intend for former Texas Civil Practice and Remedies Code section 33.004(e),[5] which concerns the effect of the timely joinder of designated responsible third parties on statutes of limitations, “to revive a claim otherwise barred by a statute of repose, as distinguished from a statute of limitations.”  Id. at 864.  Although the court recognized that the legislature has grouped statutes of repose and limitations together in chapter 16 of the Civil Practice and Remedies Code, it noted that “there are significant differences between the two.”  Id. at 866.  After noting that “[s]tatutes of repose are created by the Legislature, and the Legislature may, of course, amend them or make exceptions to them,” the court framed the issue before it as “whether the Legislature intended to make such an exception when it enacted section 33.004(e) as part of its proportionate responsibility scheme, that is, did the Legislature intend for the revival statute to operate as a general exception to periods of repose.”  Id. at 867. 

The court’s conclusion in Galbraith, limited to the effect of section 33.004(e) on statutes of repose, does not mean that section 16.064, which is expressly entitled, “Effect of Lack of Jurisdiction,” does not apply to “statutes of repose.”  See id. at 867 & n.4 (acknowledging that legislature has used term “limitations” in “both contexts” of limitations and repose; explaining that “statutes of repose in chapter 16 of the Civil Practice and Remedies Code refer to limitations rather than a period of repose”).  Indeed, a closer reading of Galbraith and an understanding of the fundamental purpose of section 16.064 and how it is different from section 33.004(e), which the supreme court recognized as a “revival statute,” compels the opposite conclusion.  Id. at 869. 

The supreme court in Galbraith noted that the legislature can “provide for the extension of a period of repose.”  Id. at 866.  The court reasoned, however, that section 33.004(e), which allows a claimant sixty days to file a claim against a person after that person is “designated as a responsible third party,” does more than “merely extend” the time to file the claim for a period of two months.  Id.  “It effectively renders the period of repose indefinite by attaching the claim’s revival to the existence of some other claim and party that may not be subject to the same or similar period of repose.”  Id.  The court noted that the original defendant, Bill Cox, and the subsequently designated responsible third party, Galbraith, worked on the same improvement to real property and were subject to similar ten-year statutes of repose.  Id.  “Hence, the court of appeals viewed section 33.004(e) as extending the period only by sixty days.”  Id.  However, as further noted by the supreme court, “in other cases a responsible third party may be subject to a longer period of repose or none at all, creating an opportunity for revival many months or years beyond the ten-year period of repose prescribed by section 16.008.”  Id. at 867. 

The supreme court concluded that the legislature could not have intended the term “limitations” as used in section 33.004(e) to apply more broadly to include statutes of “repose.”  Id. at 868–69.  It reasoned that so broadly construing the term “limitations” as used in section 33.004(e) would defeat the recognized purpose for statutes of repose, that is, the establishment of a definite end to the potential for liability, unaffected by rules of discovery or accrual.  Id. at 868.  The court found nothing in section 33.004 or the proportionate responsibility scheme to convince it that the legislature intended to revive claims extinguished by a statute of repose, and, “[b]ecause application of the revival statute in this instance effectively renders the period of repose indefinite, a consequence clearly incompatible with the purpose for such statutes,” it concluded that the legislature “intended for the term ‘limitations’ in section 33.004(e) to refer only to statutes of limitations.”  Id.  at 869 (emphasis added).

Here, in stark contrast, construing the term “limitations” as used in section 16.064 to include statutes of repose would not in any way defeat the recognized purpose of statutes of repose.   Indeed, the language of section 16.064 presumes that the pertinent action has been timely filed, albeit in a court lacking jurisdiction.  Thus, section 16.064 does not serve to “revive” an action that was lost because it was not timely filed; rather, it merely serves to “suspend” the running of periods of limitations and repose for sixty days so that a plaintiff may make a “second filing of the same action in a different court” with “proper jurisdiction.”  Tex. Civ. Prac. & Rem. Code Ann. § 16.064.

Accordingly, in interpreting the language of section 16.064, we conclude that the legislature intended for the term “statute of limitations” as used therein to include “statutes of repose,” i.e., it intended to provide for a suspension of the period of limitations or repose for an action, which, although originally filed timely, was filed in a court lacking jurisdiction.  See id.   Accordingly, we hold that the trial court erred in granting Nathan summary judgment on Whittington’s UFTA action.

We sustain Whittington’s sole issue.

Conclusion

We reverse the judgment of the trial court, and remand this case for further proceedings consistent with our opinion.         

                                                          Terry Jennings

                                                          Justice

Panel consists of Justices Jennings, Sharp, and Brown.

Justice Brown, dissenting.

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 [1]           See Tex. Bus. & Com. Code Ann. §§ 24.01–.013 (Vernon 2009). 

 [2]           See id. § 24.010.

 [3]           See id.

 [4]           See Tex. Civ. Prac. & Rem. Code Ann. § 16.064 (Vernon 2008).

 [5]           The legislature has now repealed section 33.004(e). Acts of May 30, 2011, 82nd Leg., R.S., ch. 203, §§ 5.02, 6.01–.02, 2011 Tex. Sess. Law Serv. ch. 203.