Thursday, May 17, 2018

Motion to Transfer Venue should have been heard before Rule 202 Motion - Mandamus Granted

In re Velvin Oil Company, Inc., No. 01-17-00384-CV (Tex.App. - Houston [1st Dist.] May 8, 2018) (petition for writ of mandamus conditionally granted directing trial court to set Velvin’s motion to transfer venue for a hearing and rule on the motion before proceeding with the request for a Rule 202 deposition).

IN RE VELVIN OIL COMPANY, INC., Relator.

No. 01-17-00384-CV.
Court of Appeals of Texas, First District, Houston.
Opinion on Rehearing issued May 8, 2018.

Daena Goldsmith Ramsey, Christopher Chapaneri, for Velvin Oil Company, Inc., Relator.
P. Kevin Leyendecker, for A.J.P. Oil Company, LLC, d/b/a Grapeland Fuel & BBQ, Real party in interest.

Original Proceeding on Petition for Writ of Mandamus.
Panel consists of Justices Keyes, Brown, and Lloyd.

MEMORANDUM OPINION ON REHEARING

HARVEY BROWN, Justice.

Velvin Oil Company, Inc. seeks mandamus relief concerning the trial court's May 19, 2017 order granting a Rule 202 Petition and its failure to rule on Velvin's motion to transfer venue.[1] We conclude that the trial court abused its discretion in failing to rule on the motion to transfer venue before deciding the Rule 202 Petition. Accordingly, we conditionally grant the petition as it concerns the motion to transfer venue. We deny relator's other issues.[2]

Background

Velvin distributes diesel fuel, gasoline, and other related products to retailers across Texas, including AJP. AJP originally sued Velvin in Houston County alleging fraud, negligence, and other claims regarding the quality and merchantability of the diesel fuel sold by Velvin. AJP further alleged in the Houston County petition that Velvin committed fraud by overcharging AJP for fuel taxes.

Velvin filed a plea to the jurisdiction in the Houston County suit on the overcharge claims, asserting that the trial court lacked subject-matter jurisdiction because AJP failed to exhaust its administrative remedies. Specifically, Velvin argued that AJP's overcharge claims fell under the statutory provisions requiring tax refund claims to be filed with the state comptroller. See Burgess v. Gallery Model Homes, Inc., 101 S.W.3d 550, 558 (Tex. App.-Houston [1st Dist.] 2003, pet. denied) (holding that Legislature has created exclusive means for obtaining refund of improperly-collected taxes and trial court lacks jurisdiction if plaintiff has not exhausted administrative remedies under this legislative scheme); TEX. TAX CODE § 111.104 (procedure for requesting tax refund from comptroller).

The Houston County trial court granted the plea and dismissed AJP's claims concerning tax overcharges and its claims for common-law fraud and negligent misrepresentation. The Houston County lawsuit remains pending as to AJP's causes of action regarding the quality and merchantability of the diesel fuel it purchased from Velvin.

AJP later filed a Verified Rule 202 Petition in Harris County, seeking a deposition to investigate claims "arising out of Velvin's sale of diesel fuel and collection of state diesel fuel taxes." AJP argued that it was entitled to discovery on whether Velvin was collecting and keeping for its own benefit amounts represented to be fuel taxes paid to the refineries. Unlike in the Houston County petition, AJP alleged in its Rule 202 Petition that it did not know whether Velvin kept any overcharges for its own benefit.
Velvin filed an opposition to the petition, a motion to transfer venue, and a motion to dismiss. Velvin argued that the issues raised in the Rule 202 Petition mirrored those dismissed in the Houston County case. Velvin also filed a motion for leave to set the venue motion on the same date as the hearing on the Rule 202 Petition, but the trial court denied the motion for leave. After a hearing, the trial court granted the Rule 202 Petition but has yet to rule on Velvin's motion to transfer venue.

Standard of Review

To be entitled to mandamus relief, a petitioner must show both that the trial court abused its discretion and that there is no adequate remedy by appeal. In re Prudential Ins. Co.,148 S.W.3d 124, 135 (Tex. 2004). Generally, appellate courts will hold that a trial court has abused its discretion if its actions were either "without reference to any guiding rules and principles" or "arbitrary or unreasonable." Downer v. Aquamarine Operators, Inc.,701 S.W.2d 238, 241-42 (Tex. 1985).

Trial Court Possesses Subject-Matter Jurisdiction

While Rule 202.1(b) permits parties to petition the court for an order authorizing a deposition to investigate a potential claim or suit, they generally may not "obtain by Rule 202 what [they] would be denied in the anticipated action." In re Wolfe, 341 S.W.3d 932, 933 (Tex. 2011)see In re DePinho, 505 S.W.3d 621, 623 (Tex. 2016). To properly obtain presuit discovery under Rule 202, the court must have subject-matter jurisdiction over the anticipated action. Id.

Velvin asserted in the trial court, and asserts here, that AJP's petition for presuit discovery is an attempt to circumvent the Houston County lawsuit and to avoid the statutorily-required administrative procedures, and thus, the Harris County trial court lacks subject-matter jurisdiction. AJP responds that it is seeking to discover "whether Velvin is collecting and keeping for its own benefit diesel fuel taxes in excess of the pass through tax it pays to the refineries."

Subject-matter jurisdiction is necessary to a court's authority to decide  a case. Tex. Ass'n of Bus. v. Tex. Air Control Bd., 852 S.W.2d 440, 443 (Tex. 1993). A plaintiff must allege facts affirmatively showing the trial court has subject-matter jurisdiction, id. at 446, and a party may challenge the lack of subject-matter jurisdiction by filing a plea to the jurisdiction or by other means, including by motion for summary judgment. Bland Indep. Sch. Dist. v. Blue, 34 S.W.3d 547, 554 (Tex. 2000).

Whether a court has subject-matter jurisdiction is a question of law that we review de novo. Tex. Dept. of Parks and Wildlife v. Miranda, 133 S.W.3d 217, 228 (Tex. 2004). When we conduct a de novo review, we exercise our own judgment and re-determine legal issues, giving no deference to the trial court's ruling. See Quick v. Austin, 7 S.W.3d 109, 116 (Tex. 1998).

"When . . . an agency has exclusive jurisdiction, a party must exhaust his administrative remedies before seeking judicial review of agency action." Burgess, 101 S.W.3d at 558see Oncor Elec. Delivery Co. LLC v. Chaparral Energy, LLC, No. 16-0301, 2018 WL 1974336, at *8 (Tex. Apr. 27, 2018) (stating that "[w]hen the Legislature creates a pervasive regulatory scheme, it intends for the agency with the appropriate expertise to make important determinations before the parties take their claim to the judicial system."). Before a party has exhausted these administrative remedies, "the trial court lacks subject-matter jurisdiction over the dispute and must dismiss those claims within the agency's exclusive jurisdiction." Burgess, 101 S.W.3d at 558.

To determine whether the trial court has subject-matter jurisdiction over AJP's claims, we must determine whether the Tax Code applies to those claims. If so, "the Texas Legislature intended for the remedies and causes of action in the Tax Code to be exclusive." Id. AJP asserted in its Rule 202 Petition that Velvin overcharged for fuel taxes, but stated that it "has no information as to whether Velvin keeps any excess State diesel fuel taxes it collects for its benefit or pays such excess funds to the State." Indeed, AJP asserted in its petition that it seeks the deposition to investigate "potential claims" including whether Velvin collects and keeps for its own benefit any excess charges for fuel taxes.

In Burgess, this court held that the Tax Code provides the exclusive remedy for an aggrieved taxpayer to obtain a refund of overcharged sales tax. Id. But at that time, Section 111.104(b) provided that a tax refund claim could be filed with the comptroller by the person who paid the tax. See id.Rahmes v. Louis Shanks of Tex., Inc., No. 03-04-00298-CV, 2005 WL 3331620, at *3-4 (Tex. App.-Austin Dec. 9, 2005, no pet.) (stating that excess taxes were paid before amendment and thus, prior statute and Burgess case applied); Serna v. H.E. Butt Groc. Co., 21 S.W.3d 330, 336 (Tex. App.-San Antonio 1999, no pet.) (op. on reh'g) (holding that taxpayer may seek refund from state regardless of whether taxpayer paid tax directly to state). The statute was amended in 2003 after Burgess was decided. See Act of June 20, 2003, 78th Leg., R.S., ch. 1310, § 86, 2003 Tex. Gen. Laws 4748, 4782 (codified at TEX. TAX CODE § 111.104(b)).
The 2003 amendment[3] changed who may file the claim for a refund—the claim now may be filed "only by the person who directly paid the tax to this state or by the person's attorney, assignee, or other successor." See TEX. TAX CODE § 111.104(b). AJP did not pay the taxes directly to the state; it paid them to Velvin, which then paid all or some portion of them to the state. Thus, the only entity that may seek a refund under the revised statutory scheme is Velvin or its assignee. See id.Levy v. Officemax, Inc., 228 S.W.3d 846, 850-51 (Tex. App.-Austin 2007, no pet.) (consumer sued retailer to obtain assignment of retailer's refund claim for improperly paid taxes).

Our goal in construing the amended version of section 111.104(b) is to implement the Legislature's intent. Levy, 228 S.W.3d at 850. We may not presume that the Legislature did a "useless act" when it amended Section 111.104(b). See id. As amended, the statute precludes AJP from filing a refund claim with the state because AJP did not directly pay the tax to the comptroller. See id.; TEX. TAX CODE § 111.104(b).

AJP may seek a refund from the comptroller only if it obtains an assignment of Velvin's rights. Thus, the comptroller would have no jurisdiction over a claim by AJP at this time. Cf. Levy, 228 S.W.3d at 850 (stating that "statute precludes [consumers] from filing . . . refund claim with the Comptroller"). And if the comptroller would have no jurisdiction over a claim filed by AJP, it cannot be said to have exclusive jurisdiction over it.

AJP seeks to discover whether Velvin paid any excessive funds to the comptroller. If it discovers that Velvin did not pay any part of the alleged overcharges to the state, then Section 111.104(b) would not apply. But even if AJP discovers that Velvin did pay excess taxes to the comptroller, only Velvin would possess a refund claim under Section 111.104(b), and AJP could not pursue those funds unless Velvin assigns its claim for a refund to AJP. See Levy, 228 S.W.3d at 852. Because AJP has not yet discovered whether Velvin paid any excess funds to the state, there is no showing that the statutory remedy under Section 111.104(b) applies. Therefore, Velvin has not demonstrated that the trial court abused its discretion in failing to dismiss AJP's petition for failure to exhaust its administrative remedies.

Trial Court Failed to Rule on Motion to Transfer Venue Promptly

AJP filed its Rule 202 Petition on March 24, 2017. Rule 202 permits a person to petition the trial court for an order to take a deposition "to investigate a potential claim or suit." TEX. R. CIV. P. 202.1(b). The petition must be verified and filed in the county where venue of the anticipated suit lies or where the witness resides, if suit is not anticipated. See id. 202.2(a)-(b). AJP's petition was set for a hearing on May 19. Velvin timely filed its motion to transfer venue on April 28.

Velvin asserted that AJP failed to comply with Rule 202's venue requirements. See TEX. R. CIV. P. 202.2(b)(1)-(2). AJP responded that venue in Harris County was proper because Velvin sells and delivers diesel fuel to retailers all over Texas, including some operating in Harris County. A few days after filing the motion to transfer, Velvin filed a motion for leave to set the motion to transfer on the same date as the Rule 202 Petition hearing without the required 45 days' notice or, alternatively, for a continuance of the Rule 202 Petition hearing. AJP filed an opposition to Velvin's motion to expedite consideration of the motion to transfer venue.

In its response to Velvin's mandamus petition, AJP asserts that the trial court did not abuse its discretion because the party opposing a motion to transfer must have the opportunity to obtain reasonable discovery. See TEX. R. CIV. P. 258 (trial court shall allow reasonable discovery in support of, or in opposition to, motion to transfer venue); Union Carbide Corp. v. Moye, 798 S.W.2d 792, 793 (Tex. 1990) (trial court abuses its discretion by denying opponent of motion to transfer venue opportunity to obtain reasonable discovery). AJP claimed in its opposition that by requesting expedited consideration of its motion to transfer venue, Velvin was attempting to strip AJP of its discovery rights under Rule 258.
But even if the trial court denied the motion to expedite consideration of the motion to transfer based on AJP's discovery rights, it was nonetheless required to rule "promptly" on the motion to transfer venue as required by Rule 87(1). The trial court did not rule "promptly" on the venue objection; it instead, ruled on the merits of the case—the Rule 202 Petition—before determining venue.

Under Texas Rule of Civil Procedure 84, a trial court has broad discretion to determine the order of proceedings, but that discretion is limited when deciding motions to transfer venue. Glover v. Moser, 930 S.W.2d 940, 944 (Tex. App.-Beaumont 1996, writ denied). A motion to transfer venue must be decided "promptly." See TEX. R. CIV. P. 87(1). The movant bears the burden of requesting a setting on the motion to transfer. See id. Each party is entitled to 45 days' notice of a hearing on the motion to transfer except on leave of court. See id.

Once Velvin properly filed its motion to transfer venue and requested a hearing, the trial court was required to hear the motion before ruling on the merits of the case. See Glover, 930 S.W.2d at 944 (once movant filed motion to transfer and obtained hearing, trial court required to hear and determine motion before hearing motion for default judgment); see also Gordon v. Jones, 196 S.W.3d 376, 383 (Tex. App.-Houston [1st Dist.] 2006, no pet.) (unless motion to transfer venue is waived by untimely filing of motion, trial court must determine venue before proceeding to matters relating to merits). Accordingly, it was an abuse of discretion for the trial court not to determine the motion to transfer before determining the Rule 202 Petition. See Bench Co., Inc. v. Nations Rent of Tex., L.P., 133 S.W.3d 907, 908 (Tex. App.-Dallas 2004, no pet.) (trial court must determine motion to transfer venue before determining merits).

Although an erroneous ruling on a motion to transfer venue is generally reviewable on appeal, see Cone v. Gregory, 814 S.W.2d 413, 414-15 (Tex. App.-Houston [1st Dist.] 1991, orig. proceeding) (op. on reh'g), an order granting a presuit deposition when a subsequent suit is anticipated is not an appealable order. See In re Jorden, 249 S.W.3d 416, 419 (Tex. 2008). Therefore, Velvin has no adequate remedy by appeal under these facts.

Conclusion

Accordingly, we conditionally grant Velvin's petition for writ of mandamus and direct the trial court to set Velvin's motion to transfer venue for a hearing and rule on the motion before proceeding with the request for a Rule 202 deposition. The petition is otherwise denied because, although the trial court ruled on the merits before determining the venue issue was premature, we conclude no abuse of discretion was shown in the trial court's failure to dismiss for lack of subject-matter jurisdiction. We are confident the trial court will comply with this opinion and the writ will issue only if it does not. See TEX. R. APP. P. 52.8.

[1] The underlying case is In re: A.J.P. Oil Company, LLC d/b/a Grapeland Fuel & BBQ, cause number XXXX-XXXXX, pending in the 61st District Court of Harris County, Texas, the Honorable Fredericka Phillips presiding.
[2] By opinion issued January 23, 2018, we granted Velvin's petition for writ of mandamus as it concerned the motion to transfer venue and denied it as to other issues. Relator filed a motion for rehearing. We requested a response. Although we deny the motion for rehearing, we withdraw our opinion of January 23, 2018, and issue this opinion in its place. Our disposition remains unchanged.

[3] It appears that the 2003 amendment applies here because Velvin did not begin seeking allegedly overpaid taxes until 2016 based on the petitions included in our record. The record does not disclose when the overcharges allegedly began.


Opinion on Rehearing issued May 8, 2018

In The
Court of Appeals
For The
First District of Texas
————————————
———————————
IN RE VELVIN OIL COMPANY, INC., Relator
Original Proceeding on Petition for Writ of Mandamus 

MEMORANDUM OPINION ON REHEARING

Velvin Oil Company, Inc. seeks mandamus relief concerning the trial court’s
May 19, 2017 order granting a Rule 202 Petition and its failure to rule on Velvin’s
motion to transfer venue.1 We conclude that the trial court abused its discretion in
failing to rule on the motion to transfer venue before deciding the Rule 202 Petition.

1 The underlying case is In re: A.J.P. Oil Company, LLC d/b/a Grapeland Fuel &
BBQ, cause number 2017-20243, pending in the 61st District Court of Harris
County, Texas, the Honorable Fredericka Phillips presiding.
2
Accordingly, we conditionally grant the petition as it concerns the motion to transfer
venue. We deny relator’s other issues.2

Background
Velvin distributes diesel fuel, gasoline, and other related products to retailers
across Texas, including AJP. AJP originally sued Velvin in Houston County alleging
fraud, negligence, and other claims regarding the quality and merchantability of the
diesel fuel sold by Velvin. AJP further alleged in the Houston County petition that
Velvin committed fraud by overcharging AJP for fuel taxes.
Velvin filed a plea to the jurisdiction in the Houston County suit on the
overcharge claims, asserting that the trial court lacked subject-matter jurisdiction
because AJP failed to exhaust its administrative remedies. Specifically, Velvin
argued that AJP’s overcharge claims fell under the statutory provisions requiring tax
refund claims to be filed with the state comptroller. See Burgess v. Gallery Model
Homes, Inc., 101 S.W.3d 550, 558 (Tex. App.—Houston [1st Dist.] 2003, pet.
denied) (holding that Legislature has created exclusive means for obtaining refund
of improperly-collected taxes and trial court lacks jurisdiction if plaintiff has not

2 By opinion issued January 23, 2018, we granted Velvin’s petition for writ of
mandamus as it concerned the motion to transfer venue and denied it as to other
issues. Relator filed a motion for rehearing. We requested a response. Although we
deny the motion for rehearing, we withdraw our opinion of January 23, 2018, and
issue this opinion in its place. Our disposition remains unchanged.
3
exhausted administrative remedies under this legislative scheme); TEX. TAX CODE §
111.104 (procedure for requesting tax refund from comptroller).
The Houston County trial court granted the plea and dismissed AJP’s claims
concerning tax overcharges and its claims for common-law fraud and negligent
misrepresentation. The Houston County lawsuit remains pending as to AJP’s causes
of action regarding the quality and merchantability of the diesel fuel it purchased
from Velvin.
AJP later filed a Verified Rule 202 Petition in Harris County, seeking a
deposition to investigate claims “arising out of Velvin’s sale of diesel fuel and
collection of state diesel fuel taxes.” AJP argued that it was entitled to discovery on
whether Velvin was collecting and keeping for its own benefit amounts represented
to be fuel taxes paid to the refineries. Unlike in the Houston County petition, AJP
alleged in its Rule 202 Petition that it did not know whether Velvin kept any
overcharges for its own benefit.
Velvin filed an opposition to the petition, a motion to transfer venue, and a
motion to dismiss. Velvin argued that the issues raised in the Rule 202 Petition
mirrored those dismissed in the Houston County case. Velvin also filed a motion for
leave to set the venue motion on the same date as the hearing on the Rule 202
Petition, but the trial court denied the motion for leave. After a hearing, the trial court
4
granted the Rule 202 Petition but has yet to rule on Velvin’s motion to transfer
venue.
Standard of Review
To be entitled to mandamus relief, a petitioner must show both that the trial
court abused its discretion and that there is no adequate remedy by appeal. In re
Prudential Ins. Co., 148 S.W.3d 124, 135 (Tex. 2004). Generally, appellate courts
will hold that a trial court has abused its discretion if its actions were either “without
reference to any guiding rules and principles” or “arbitrary or unreasonable.”
Downer v. Aquamarine Operators, Inc., 701 S.W.2d 238, 241–42 (Tex. 1985).
Trial Court Possesses Subject-Matter Jurisdiction
While Rule 202.1(b) permits parties to petition the court for an order
authorizing a deposition to investigate a potential claim or suit, they generally may
not “obtain by Rule 202 what [they] would be denied in the anticipated action.” In
re Wolfe, 341 S.W.3d 932, 933 (Tex. 2011); see In re DePinho, 505 S.W.3d 621,
623 (Tex. 2016). To properly obtain presuit discovery under Rule 202, the court
must have subject-matter jurisdiction over the anticipated action. Id.
Velvin asserted in the trial court, and asserts here, that AJP’s petition for
presuit discovery is an attempt to circumvent the Houston County lawsuit and to
avoid the statutorily-required administrative procedures, and thus, the Harris County
trial court lacks subject-matter jurisdiction. AJP responds that it is seeking to
5
discover “whether Velvin is collecting and keeping for its own benefit diesel fuel
taxes in excess of the pass through tax it pays to the refineries.”
Subject-matter jurisdiction is necessary to a court’s authority to decide a case.
Tex. Ass’n of Bus. v. Tex. Air Control Bd., 852 S.W.2d 440, 443 (Tex. 1993). A
plaintiff must allege facts affirmatively showing the trial court has subject-matter
jurisdiction, id. at 446, and a party may challenge the lack of subject-matter
jurisdiction by filing a plea to the jurisdiction or by other means, including by motion
for summary judgment. Bland Indep. Sch. Dist. v. Blue, 34 S.W.3d 547, 554 (Tex.
2000).
Whether a court has subject-matter jurisdiction is a question of law that we
review de novo. Tex. Dept. of Parks and Wildlife v. Miranda, 133 S.W.3d 217, 228
(Tex. 2004). When we conduct a de novo review, we exercise our own judgment and
re-determine legal issues, giving no deference to the trial court’s ruling. See Quick
v. Austin, 7 S.W.3d 109, 116 (Tex. 1998).
“When . . . an agency has exclusive jurisdiction, a party must exhaust his
administrative remedies before seeking judicial review of agency action.” Burgess,
101 S.W.3d at 558; see Oncor Elec. Delivery Co. LLC v. Chaparral Energy, LLC,
No. 16–0301, 2018 WL 1974336, at *8 (Tex. Apr. 27, 2018) (stating that “[w]hen
the Legislature creates a pervasive regulatory scheme, it intends for the agency with
the appropriate expertise to make important determinations before the parties take
6
their claim to the judicial system.”). Before a party has exhausted these
administrative remedies, “the trial court lacks subject-matter jurisdiction over the
dispute and must dismiss those claims within the agency’s exclusive jurisdiction.”
Burgess, 101 S.W.3d at 558.
To determine whether the trial court has subject-matter jurisdiction over
AJP’s claims, we must determine whether the Tax Code applies to those claims. If
so, “the Texas Legislature intended for the remedies and causes of action in the Tax
Code to be exclusive.” Id. AJP asserted in its Rule 202 Petition that Velvin
overcharged for fuel taxes, but stated that it “has no information as to whether Velvin
keeps any excess State diesel fuel taxes it collects for its benefit or pays such excess
funds to the State.” Indeed, AJP asserted in its petition that it seeks the deposition to
investigate “potential claims” including whether Velvin collects and keeps for its
own benefit any excess charges for fuel taxes.
In Burgess, this court held that the Tax Code provides the exclusive remedy
for an aggrieved taxpayer to obtain a refund of overcharged sales tax. Id. But at that
time, Section 111.104(b) provided that a tax refund claim could be filed with the
comptroller by the person who paid the tax. See id.; Rahmes v. Louis Shanks of Tex.,
Inc., No. 03–04–00298–CV, 2005 WL 3331620, at *3–4 (Tex. App.—Austin Dec.
9, 2005, no pet.) (stating that excess taxes were paid before amendment and thus,
prior statute and Burgess case applied); Serna v. H.E. Butt Groc. Co., 21 S.W.3d
7
330, 336 (Tex. App.—San Antonio 1999, no pet.) (op. on reh’g) (holding that
taxpayer may seek refund from state regardless of whether taxpayer paid tax directly
to state). The statute was amended in 2003 after Burgess was decided. See Act of
June 20, 2003, 78th Leg., R.S., ch. 1310, § 86, 2003 Tex. Gen. Laws 4748, 4782
(codified at TEX. TAX CODE § 111.104(b)).
The 2003 amendment3
changed who may file the claim for a refund—the
claim now may be filed “only by the person who directly paid the tax to this state or
by the person’s attorney, assignee, or other successor.” See TEX. TAX CODE
§ 111.104(b). AJP did not pay the taxes directly to the state; it paid them to Velvin,
which then paid all or some portion of them to the state. Thus, the only entity that
may seek a refund under the revised statutory scheme is Velvin or its assignee. See
id.; Levy v. Officemax, Inc., 228 S.W.3d 846, 850–51 (Tex. App.—Austin 2007, no
pet.) (consumer sued retailer to obtain assignment of retailer’s refund claim for
improperly paid taxes).
Our goal in construing the amended version of section 111.104(b) is to
implement the Legislature’s intent. Levy, 228 S.W.3d at 850. We may not presume
that the Legislature did a “useless act” when it amended Section 111.104(b). See id.
As amended, the statute precludes AJP from filing a refund claim with the state

3
It appears that the 2003 amendment applies here because Velvin did not begin
seeking allegedly overpaid taxes until 2016 based on the petitions included in our
record. The record does not disclose when the overcharges allegedly began.
8
because AJP did not directly pay the tax to the comptroller. See id.; TEX. TAX CODE
§ 111.104(b).
AJP may seek a refund from the comptroller only if it obtains an assignment
of Velvin’s rights. Thus, the comptroller would have no jurisdiction over a claim by
AJP at this time. Cf. Levy, 228 S.W.3d at 850 (stating that “statute precludes
[consumers] from filing . . . refund claim with the Comptroller”). And if the
comptroller would have no jurisdiction over a claim filed by AJP, it cannot be said
to have exclusive jurisdiction over it.
AJP seeks to discover whether Velvin paid any excessive funds to the
comptroller. If it discovers that Velvin did not pay any part of the alleged
overcharges to the state, then Section 111.104(b) would not apply. But even if AJP
discovers that Velvin did pay excess taxes to the comptroller, only Velvin would
possess a refund claim under Section 111.104(b), and AJP could not pursue those
funds unless Velvin assigns its claim for a refund to AJP. See Levy, 228 S.W.3d at
852. Because AJP has not yet discovered whether Velvin paid any excess funds to
the state, there is no showing that the statutory remedy under Section 111.104(b)
applies. Therefore, Velvin has not demonstrated that the trial court abused its
discretion in failing to dismiss AJP’s petition for failure to exhaust its administrative
remedies.
Trial Court Failed to Rule on Motion to Transfer Venue Promptly
9
AJP filed its Rule 202 Petition on March 24, 2017. Rule 202 permits a person
to petition the trial court for an order to take a deposition “to investigate a potential
claim or suit.” TEX. R. CIV. P. 202.1(b). The petition must be verified and filed
in the county where venue of the anticipated suit lies or where the witness resides,
if suit is not anticipated. See id. 202.2(a)-(b). AJP’s petition was set for a hearing on
May 19. Velvin timely filed its motion to transfer venue on April 28.
Velvin asserted that AJP failed to comply with Rule 202’s venue
requirements. See TEX. R. CIV. P. 202.2(b)(1)-(2). AJP responded that venue in
Harris County was proper because Velvin sells and delivers diesel fuel to retailers
all over Texas, including some operating in Harris County. A few days after filing
the motion to transfer, Velvin filed a motion for leave to set the motion to transfer
on the same date as the Rule 202 Petition hearing without the required 45 days’
notice or, alternatively, for a continuance of the Rule 202 Petition hearing. AJP
filed an opposition to Velvin’s motion to expedite consideration of the motion to
transfer venue.
In its response to Velvin’s mandamus petition, AJP asserts that the trial court
did not abuse its discretion because the party opposing a motion to transfer must
have the opportunity to obtain reasonable discovery. See TEX. R. CIV. P. 258 (trial
court shall allow reasonable discovery in support of, or in opposition to, motion
to transfer venue); Union Carbide Corp. v. Moye, 798 S.W.2d 792, 793 (Tex. 1990)
10
(trial court abuses its discretion by denying opponent of motion to transfer venue
opportunity to obtain reasonable discovery). AJP claimed in its opposition that by
requesting expedited consideration of its motion to transfer venue, Velvin was
attempting to strip AJP of its discovery rights under Rule 258.
But even if the trial court denied the motion to expedite consideration of the
motion to transfer based on AJP’s discovery rights, it was nonetheless required to
rule “promptly” on the motion to transfer venue as required by Rule 87(1). The trial
court did not rule “promptly” on the venue objection; it instead, ruled on the merits
of the case—the Rule 202 Petition—before determining venue.
Under Texas Rule of Civil Procedure 84, a trial court has broad discretion to
determine the order of proceedings, but that discretion is limited when deciding
motions to transfer venue. Glover v. Moser, 930 S.W.2d 940, 944 (Tex. App.—
Beaumont 1996, writ denied). A motion to transfer venue must be decided
“promptly.” See TEX.R.CIV. P. 87(1). The movant bears the burden of requesting
a setting on the motion to transfer. See id. Each party is entitled to 45 days’ notice
of a hearing on the motion to transfer except on leave of court. See id.
Once Velvin properly filed its motion to transfer venue and requested a
hearing, the trial court was required to hear the motion before ruling on the merits
of the case. See Glover, 930 S.W.2d at 944 (once movant filed motion to transfer
and obtained hearing, trial court required to hear and determine motion before
11
hearing motion for default judgment); see also Gordon v. Jones, 196 S.W.3d 376,
383 (Tex. App.—Houston [1st Dist.] 2006, no pet.) (unless motion to transfer venue
is waived by untimely filing of motion, trial court must determine venue before
proceeding to matters relating to merits). Accordingly, it was an abuse of discretion
for the trial court not to determine the motion to transfer before determining the Rule
202 Petition. See Bench Co., Inc. v. Nations Rent of Tex., L.P., 133 S.W.3d 907, 908
(Tex. App.—Dallas 2004, no pet.) (trial court must determine motion to transfer
venue before determining merits).
Although an erroneous ruling on a motion to transfer venue is generally
reviewable on appeal, see Cone v. Gregory, 814 S.W.2d 413, 414–15 (Tex. App.—
Houston [1st Dist.] 1991, orig. proceeding) (op. on reh’g), an order granting a presuit
deposition when a subsequent suit is anticipated is not an appealable order. See In
re Jorden, 249 S.W.3d 416, 419 (Tex. 2008). Therefore, Velvin has no adequate
remedy by appeal under these facts.
Conclusion
Accordingly, we conditionally grant Velvin’s petition for writ of mandamus
and direct the trial court to set Velvin’s motion to transfer venue for a hearing and
rule on the motion before proceeding with the request for a Rule 202 deposition.
12
The petition is otherwise denied because, although the trial court ruled on the
merits before determining the venue issue was premature, we conclude no abuse of
discretion was shown in the trial court’s failure to dismiss for lack of subject-matter
jurisdiction. We are confident the trial courtwill complywith this opinion and the writ
will issue only if it does not. See TEX. R. APP. P. 52.8.
Harvey Brown
Justice
Panel consists of Justices Keyes, Brown, and Lloyd.

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