Justice Terry Jennings Dissents

R. C. Jones, Superior Waste Management Services, Inc., and JTI Contractors, Inc. v. Rustin Transportation Company, L.P, No. (Tex.App,.- Houston [1st Dist.] Aug. 2, 2007)(Dissenting Opinion by Justice Jennings) (Before Justices Jennings, Hanks and Higley)
Appeal from 295th District Court of Harris County
Trial court judge: Hon. Tracy Christopher

DISSENTING OPINION BY JUSTICE TERRY JENNINGS

The trial court expressly found that trial counsel for appellee, Rustin Transportation Company, L.P. ("Rustin"), in her jury argument, "completely concocted" facts and implied that trial counsel for appellants, R. C. Jones, Superior Waste Management Services, Inc. ("Superior"), and JTI Contractors, Inc. ("JTI"), "suborned perjury." The trial court further found the argument, based on a "made-up conversation," to be "improper" and "inflammatory."

Although the majority agrees that the accusations of suborning perjury were "reprehensible," it concludes, in violation of Texas Supreme Court precedent, that the "improper, inflammatory" jury argument was "curable" and that by failing "to object, request an instruction to disregard, and request a motion for mistrial," appellants waived any error for our review. It compounds this error by actually suggesting, without any authority, that appellants should have requested specific instructions to cure the false allegations of suborned perjury. The majority further errs in holding alternatively that the trial court did not err in denying appellants' motion for new trial. It reaches this result by conducting a conclusory harm analysis, merely quoting the trial court's finding that the jury's verdict was probably grounded on proper evidence.

Under the majority's analysis, virtually any "reprehensible" and "improper, inflammatory" jury argument could be cured. The majority's error will serve to encourage more such arguments and is, thus, of such importance to the State's jurisprudence that it should be corrected. Accordingly, I respectfully dissent.

Background

Appellants sued Republic Waste Services of Texas, Ltd. ("Republic") and Rustin for breach of contract and fraud. The City of Houston, pursuant to its Minority and Women Business Enterprises Program ("MWBE"), requires City contractors to sign "Letter of Intent" agreements with minority-owned subcontractors and to submit the agreements and a MWBE participation plan to the City when bidding on certain city contracts. Republic obtained a 20-year waste disposal contract with the City for a bid amount of $295 million, and it subcontracted with Rustin for transfer station loading and hauling of waste. Jones, an African-American who owns Superior, and Jesse Valeriano, a Hispanic who owns JTI, signed Letters of Intent, agreeing to haul waste to Republic's landfill.

Appellants alleged that Republic breached the agreements, "which granted Superior and JTI each 10% participation" as minority-owned subcontractors in Republic's 20-year waste disposal contract with the City. Appellants also alleged that both Republic and Rustin "never intended for Superior and JTI to participate in 10% of the [City] Contract" and that Rustin breached its subcontracts with them by failing to pay them annual consumer price index ("CPI") rate adjustments.

Superior and JTI each signed three hauling subcontracts with Rustin. The "intent of the parties" regarding the payment of CPI increases was hotly contested. Appellants presented evidence that their subcontracts with Rustin should have been read together with Republic's contract with the City to ascertain the parties' intent about CPI rate adjustments, i.e., that the rates be adjusted "[b]eginning July 1, 2001 and each subsequent July 1, thereafter." Rustin presented evidence that Superior and JTI were to receive rate increases only when Rustin received a rate increase.

At the conclusion of a three-week long trial, the trial court submitted the case to the jury on issues as to whether the parties actually reached certain agreements, whether Republic failed to comply with them, whether Republic committed fraud, and whether Rustin was part of a conspiracy to commit fraud. In the issues concerning the contracts between appellants and Rustin, the trial court instructed the jury to interpret the meaning of the language in the signed agreements. (1) The trial court concluded that the pertinent contracts were ambiguous and that the jury had to determine the intent of the parties. (2) In an eleven to one verdict, the jury answered all of the liability questions against appellants.

The "Reprehensible" and "Improper, Inflammatory Jury Argument"

From the outset, the pervading theme of the jury argument of Rustin's trial counsel, Jennifer House, was that "this case is a lawyer's construct, it is created by lawyers." (Emphasis added.) After noting that, because of the trial, she did not have time to put away her Christmas ornaments, House lamented, "There is something very, very wrong with what has happened in this case. There is something wrong about an individual who has fought for his country, been wounded three times, to be accused of fraud in the operation of his business, to benefit people who don't want to work and who are expecting a windfall." (Emphasis added.)
After discussing some of the fraud allegations and some of the evidence in favor of her client, House launched, full force, into her attack on opposing counsel, John Able, and appellants' case:
[Ms. House]: . . . . I am proud to be a lawyer. I take no pride in accusing other lawyers of wrongdoing, but I cannot help but have difficulty with the fact that Rustin never made representations to these minority subcontractors that they were going to be entitled to overall 20 percent participation of $295 million.
. . . .
Mr. Jones . . . was going to punish these companies every step of the way because he believed that there wouldn't be 12 of you in this box smart enough to understand what happened. But you are smart enough. . . .
And when [Valeriano] testified in October of 2002 that he was operating profitably from Westpark and Lawndale, he was telling the truth.
Why did the story change, then? Why did the story change? Because he met Mr. Able and Mr. Able said, "Jesse, by the way, did you know under our theory you are entitled to $5 million of profit over 20 years?"
[Mr. Able]: Objection, Your Honor. There is no evidence that I told him anything.
[Trial Court]: Sustained.
After the trial court sustained Able's objection, House, without skipping a beat, continued:
[Ms. House]: Suddenly--and you heard the testimony. Mr. Able questioned him, and the testimony was he met with Mr. Able after his deposition. Do you know who else he met with? The gentleman sitting in this corner right here, Greg Brown, CPA.
Now it is interesting. . . . [Valeriano] needs a new CPA and--he needs a new attorney, Mr. Able, and a new CPA. And suddenly the entire story changes. And suddenly in February of 2003, a couple of months later, he is a party to this lawsuit.
. . . .
And I will tell you why he is a party to this lawsuit. Because the couple of hundred thousand dollars that he was going to make or was making with Rustin, vis-a-vis the existing work that he was doing, in his mind was peanuts compared to the $5 million that he was going to ask you for under the trumped up claim that he was entitled to 10 percent of $295 million over 20 years. And that's why the story changed, and that's why we are here.
(Emphasis added.)

In comparing the credibility of Jim Goodyear, a Rustin witness, with that of Valeriano, House noted that when Goodyear met with Valeriano, Valeriano did not ask for "10 percent of $295 million." She stated,

[Ms. House]: He never said that. It is a construct. That idea happened later. It didn't happen in the beginning. It wasn't part of the negotiations. It happened later. It was an idea that occurred, I submit, with the participation of lawyers and accountants.
(Emphasis added.)

In summing up for the jury, House emphasized, "Ladies and gentlemen of the jury, everything I have told you and argued to you in these brief moments is supported by these written documents, not a construct of mine at all." (Emphasis added.)

House's theme, from start to finish, was that appellants' case, based on suborned perjury, was "a lawyer's construct," a "trumped up claim" of their "lawyers and accountants." In complete contrast, Rustin's defense was "not a construct . . . at all." Thus, the trial court's and the majority's findings that the improper and inflammatory argument was "short in duration" and was "not repeated" are patently wrong.

In their new trial motion, appellants asserted that House's improper argument caused them incurable harm. See Tex. R. Civ. P. 324(b)(5). The trial court, in its order denying the motion, stated that it did not believe that the jury's verdict was "the result of the improper, inflammatory jury argument made by Jennifer House." (Emphasis added.) Nevertheless, the trial court went on to note,

But let there be no doubt that the argument was improper. And although Ms. House in oral argument stated that she "was stunned by the seriousness with which the Court regarded the allegations," the denial of the new trial does not mean that the court condones this type of argument. Attacks on opposing counsel are error. . . .

In Ms. House's argument she completely concocted a conversation between the plaintiff's counsel, Mr. Able, and the plaintiff, Mr. Valeriano, and implied that Mr. Able suborned perjury. Ms. House stated in closing argument "Why did the story change, then? Why did the story change? Because he met Mr. Able and Mr. Able said, "Jesse, by the way, did you know under our theory you are entitled to $5 million of profit over 20 years?"

What is most disturbing is Ms. House's attempt to explain away this made-up conversation. In her brief and in her oral argument before the court she attempted to justify her statement, claiming it was based on questions asked by Mr. Able in a deposition. The court has reviewed the entire deposition of Mr. Valeriano and there is no reference to such a question or statement or meeting. And most certainly there was no evidence before the jury of such a question or statement or meeting. Ms. House continues her misstatements in her briefing. At page 5 of her brief, Ms. House says, "each and every questioned statement made by Ms. House is in the record and is based in fact." There is absolutely no evidence in the record of such a meeting or such a statement.

At oral argument, realizing that the court was skeptical that questions [that] were asked in a deposition would be considered a meeting, Ms. House then argues that Mr. Able and Mr. Valeriano must have met to form the attorney client relationship and that such a meeting could be inferred from the fact that Mr. Valeriano became Mr. Able's client. While undoubtedly there were many meetings between Mr. Able and Mr. Valeriano, (although of course there is no evidence in the record of such meetings) what Ms. House fabricated was the content of such a meeting and the implication that Mr. Able suborned perjury and induced Mr. Valeriano to change his story. (Citations omitted) (emphasis added).

Incurable Harm = Reversible Harm In their first issue, appellants argue that the trial court erred in denying their new trial motion because trial counsel for Rustin falsely accused their counsel of "suborning perjury, thereby violating the most basic tenets of fundamental fairness and rendering the proceedings patently unfair." They assert that, given the seriousness of House's unsupported allegations of perjury, damage to their case should be presumed as a matter of law. In fact, how can such a "reprehensible" and "improper, inflammatory jury argument," not be harmful to a litigant's case?

In cases involving improper jury argument, an appellant must show "a number of things." Standard Fire Ins. Co. v. Reese, 584 S.W.2d 835, 839 (Tex. 1979). As noted by the Texas Supreme Court in Reese, generally,

He has the burden to prove (1) an error (2) that was not invited or provoked, (3) that was preserved by the proper trial predicate, such as an objection, a motion to instruct, or a motion for mistrial, and (4) was not curable by an instruction, a prompt withdrawal of the statement, or a reprimand by the judge. . . . There are only rare instances of incurable harm from improper argument. The complainant has the further burden to prove (5) that the argument by its nature, degree and extent constituted reversibly harmful error. How long the argument continued, whether it was repeated or abandoned and whether there was cumulative error are proper inquiries. All of the evidence must be closely examined to determine (6) the argument's probable effect on a material finding. (7) Importantly, a reversal must come from an evaluation of the whole case, which begins with the voir dire and ends with the closing argument. The record may show that the cause is weak, strong, or very close. From all of these factors, the complainant must show that the probability that the improper argument caused harm is greater than the probability that the verdict was grounded on the proper proceedings and evidence.
Id. at 839-40 (citations omitted) (emphasis added). This language has been described as "unusually broad," "remarkable," and "confusing." Roger D. Townsend, Improper Jury Argument and Professionalism: Rethinking Standard Fire v. Reese, 67 Tex. B. J. 448, 449-50 (June 2004). However, after stating the above, the supreme court clarified:

The injection of new and inflammatory matters into the case through argument has in exceptional instances been regarded as incurable by an instruction. An appeal to racial prejudice falls into the category. . . . The use in argument of the epithets, "liar," "fraud," "faker," "cheat," and "imposter" in disregard of objections that were made was harmful. . . . The unsupported charge of perjury was incurable. . . . Those cases . . . show that an affront to the court and the equality which it must portray will be dealt with harshly.
Reese, 584 S.W.2d at 840 (citations omitted) (emphasis added).

As noted by then Justice David Peeples in Texas Employers' Insurance Association v. Guerrero, "Clearly an incurable argument does not require an objection, but to go further and hold that an argument can be incurable and yet harmless is a contradiction in terms." 800 S.W.2d 859, 863 (Tex. App.--San Antonio 1990, writ denied). Thus, the court held that "incurable does not mean simply that no objection need be made; it also means that the argument's harmfulness, its reversible impact, cannot be cured or corrected by an instruction." Id. at 864 (emphasis added). As previously explained by the supreme court,

Improper jury arguments are usually referred to as one of two types: "curable" or "incurable." A jury argument is "curable" when the harmful effect of the argument can be eliminated by a trial judge's instruction to the jury to disregard what they have just heard. The error is "cured" and rendered harmless by the instruction. On the other hand, an argument may be so inflammatory that its harmfulness could not be eliminated by an instruction to the jury to disregard it. The prejudicial nature of the argument is so acute that it is "incurable."
Otis Elevator Co. v. Wood, 436 S.W.2d 324, 333 (Tex. 1968) (emphasis added).

In Howsley & Jacobs v. Kendall, a plaintiff's lawyer argued to the jury that "[s]omebody was testifying through the lips of" a critical witness and that witness testified "under the coaching of this battery of lawyers." 376 S.W.2d 562, 565-66 (Tex. 1964). The Texas Supreme Court concluded that "[a]n assertion of facts having no evidentiary basis were placed before the jury and these asserted facts were in turn made the basis of an inflammatory appeal." Id. at 566. It therefore held that "[n]o instruction of the trial judge could have removed the prejudicial effects of the argument and hence no objection was necessary to preserve the error." Id. Why? Because the prejudicial harm from such an inflammatory argument is readily apparent:

It is our opinion that from the time the charge was made that someone else was testifying though the lips of [the witness], coupled with the statement as to a 'battery of lawyers,' the [defendant]'s case was irretrievably prejudiced. Id. (emphasis added).

Likewise, here, "from the time" that the unsupported allegation of suborned perjury "was made," appellants' case was "irretrievably prejudiced." Contrary to the majority's representation that "the issue of the changed testimony . . . went to appellants' theory of damages," Ms. House did not so limit her improper argument. She characterized appellants' entire case as a lawyer's construct, based on suborned perjury. Although on point and controlling, the majority merely mentions Howsley & Jacobs in a parenthetical. Ignoring the supreme court's holding that "no instruction" could remove the prejudicial effects of such "an inflammatory appeal," the majority compounds its error by crafting its own instructions to cure the "perceived prejudicial effect" of House's comments. In fact, instructing the jury that "it was improper for House to impute wrongdoing of any kind to appellants' counsel" and that "any further argument along such line would result in a mistrial," would, as illustrated in Howsley & Jacobs, have done nothing to remove the prejudicial effects of the inflammatory argument.
This case, involving allegations of breach of contract and fraud, like most cases actually tried to a jury, boiled down to the credibility of the witnesses. The jury was asked to decide whether the parties had actually reached certain agreements, to interpret the agreements to ascertain the intent of the parties, to decide whether the defendants breached any agreements, and to determine whether the defendants engaged in fraud. The credibility of appellants was obviously critical in deciding these issues, especially in light of the fact that the jury was asked to determine whether the parties had actually reached certain agreements and the intent of the parties about their agreements. There can be no doubt but that a juror, even after receiving the majority's proposed instructions, would place considerable weight on House's inflammatory comments. How could a juror not be influenced by her assertion that appellants' entire case was a "trumped up" "construct" of lawyers and accountants based on suborned perjury?

Given that the pervading theme of Rustin's jury argument was that appellants' entire case "is a lawyer's construct, it is created by lawyers," and Rustin's case was not, the trial court's and the majority's findings that the inflammatory argument was "short in duration" and was "not repeated" are objectively and clearly erroneous. However, the record does reveal, as found by the trial court, that House "concocted" her argument that Abel suborned perjury. (3) There is no evidence in the record supporting an inference that Able met with Valeriano and suborned perjury and "trumped up" a claim. The argument was neither invited nor provoked, and it injected the new, inflammatory, and unsupported charge of suborned perjury into the case. Calculated to cause the rendition of an improper judgment, the inflammatory argument called into question the ultimate integrity of the fact-finding process and was particularly egregious.
The "improper, inflammatory jury argument," along with House's assertions that appellants' entire case was a "trumped up claim" and a "construct" of their "lawyers and accountants," irretrievably prejudiced appellants' case. See Howsley & Jacobs, 376 S.W.2d at 566. Thus, the argument's harmfulness, i.e., its "reversible impact," could not be cured. Guerrero, 800 S.W.2d at 864. Indeed, this Court has previously explained that a similar charge "by [an] appellee's counsel to the effect that [an] appellant's entire case was based upon perjury and manufactured testimony, to which his counsel was a party, could scarcely have done other than result in harm." Cross v. Houston Belt & Terminal Ry. Co., 351 S.W.2d 84, 87 (Tex. Civ. App.--Houston 1961, writ ref'd n.r.e.). (4) Accordingly, the majority seriously errs in concluding that Ms. House's "reprehensible" comments "were curable" and holding that appellants "waived this error." Likewise, it errs in concluding, alternatively, that her "improper, inflammatory" jury argument did not harm appellants' case.

Conclusion

I would hold that the "reprehensible" and "improper, inflammatory jury argument" made by Rustin's trial counsel was incurable and thus, that it probably caused the rendition of an improper judgment. See Tex. R. App. P. 44.1(a)(1). I would further hold that the trial court abused its discretion in denying appellants' motion for new trial. Accordingly, I would sustain appellants' first issue, reverse the judgment of the trial court, and remand the case for a new trial.

The majority's decision to the contrary is in serious error. The majority's opinion, based on its interpretation of Reese, will actually encourage more such improper arguments, "for what is permitted is considered proper." Roger D. Townsend, 67 Tex. B. J. at 454. If appellate courts are inclined to find such an "improper, inflammatory jury argument" to actually be curable, why not "take the gloves off," engage in such inflammatory displays, and bias and prejudice the jury against your opponent? See id. Importantly, although such "improper arguments work," they take a great toll on the public's perceptions of lawyers and our jury trial system. Id. at 453. Improper arguments confirm for real jurors in real Texas courtrooms the worst caricatures of lawyers and our justice system that television and movies have to offer.

Ultimately, trial judges have the duty to enforce "law and order, as well as dignity, in their courtrooms." Id. at 454. Indeed, trial courts need not "wait for objections to be made when the rules as to arguments are violated." Tex. R. Civ. P. 269(g). "Mere personal criticism by counsel upon each other" in argument "shall be promptly corrected as a contempt of court." Tex. R. Civ. P. 269(e). Appellate justices also have important duties as illustrated by this case. As noted by Townsend,

When [judges] abdicate [their] duty, professionalism suffers even more than when a lawyer makes an improper argument, for what is permitted is considered proper by the jury. All judges who do not stop improper arguments--and all trial lawyers who make improper arguments--have no business lamenting the public's low perception of lawyers. They need only look in the mirror. Roger D. Townsend, 67 Tex. B. J. at 454 (emphasis added).

Terry Jennings
Justice
Panel consists of Justices Jennings, Hanks, and Higley.
Justice Jennings, dissenting.

1. For example, the trial court submitted question 9 as follows:
Did Rustin fail to comply with the contracts between Superior and Rustin in payment of CPI increases?
It is your duty to interpret the following language of the signed agreements between Rustin and Superior:
"The transportation rate for the applicable Contract Year shall be adjusted . . . ."
You must decide its meaning by determining the intent of the parties at the time of the agreement. Consider all the facts and circumstances surrounding the making of the agreement, the interpretation placed on the agreement by the parties, and the conduct of the parties.
2. See J.M. Davidson, Inc. v. Webster, 128 S.W.3d 223, 229 (Tex. 2003).
3. A person commits the third degree felony offense of aggravated perjury if he makes a false, material statement under oath during or in connection with an official proceeding. Tex. Pen. Code Ann. § 37.03 (Vernon 2003).
4. It should be noted that some courts have concluded that "incurable harm" from a jury argument does not necessarily equate to "reversible harm." See Manon v. Solis, 142 S.W.3d 380, 391 n.6 (Tex. App.--Houston [14th Dist.] 2004, pet. denied). However, this Court, in a criminal case, has previously noted the incongruity of determining whether an "incurable" improper jury argument is "harmful" or "harmless." Thompson v. State, 89 S.W.3d 843, 853 (Tex. App.--Houston [1st Dist.] 2002, pet. ref'd). After all, "incurable" is defined as "[n]ot admitting of remedy, correction, or reformation." The Compact Oxford English Dictionary 835 (2d ed. 1991). Nevertheless, controlling authority in criminal cases actually requires a harmless error analysis even when an appellate court concludes that an improper argument is "incurable." Thompson, 89 S.W.3d at 853.
In contrast, as pointed out in Guerrero, controlling authority in civil cases recognizes that in certain instances, although rare, a harmless error analysis need not be performed when the harm from an improper argument is "incurable." 800 S.W.2d at 864. The court, in Guerrero, emphasized that the supreme court, in Reese, equated the term "incurable" with "harmful." Id. The "notion of 'cure' refers to removing the argument's harmful effect." Id. The supreme court has specifically recognized that appeals to racial prejudice and "unsupported charge[s] of perjury" are "incurable." Reese, 584 S.W.2d at 840.