Probate Court Recusal Saga Involving Judge Wood Continues

In the latest installment of a series of appellate opinions involving recusal motions under TRCP 18a stemming from the same underlying probate dispute, a panel of the 14th Court of Appeals today granted mandamus relief, disapproving of Probate Judge Wood's denial of a motion to recuse him, based on a procedural technicality. Faced with a motion to recuse, timely or otherwise, the judge - as target of the motion - should have referred it to the administrative judge for a decision on its procedural propriety (and, if so, its merits) by another judge. The reviewing court finds that both the order adjudicating the recusal motion signed by the judge sought to be recused, and a transfer order signed by him while the recusal motion was pending are void.

MEMORANDUM OPINION BY JUSTICE ANDERSON

In this original proceeding, relator, Miguel Angel Guilbot, seeks a writ of mandamus ordering the respondent, Judge Mike Wood, judge of Probate Court No. 2, to vacate orders signed April 17, 2009, June 18, 2009, and June 19, 2009. We conditionally grant the writ.

Factual and Procedural Background

This dispute centers on a family business and the litigation that ensued among family members after one of the business's co-founders died. The co-founder's will was probated in 2003, and litigation began in 2004.

The original suit was filed in Probate Court No. 2 and bore the cause number 344,157-401. In that case, relator filed a motion to recuse Judge Wood. Judge Wood refused to recuse himself and forwarded relator's recusal motion to Judge Guy Herman, presiding judge of the statutory probate courts. Judge Herman assigned Judge Gladys Burwell to hear the motion to recuse Judge Wood. Relator thereafter filed motions to recuse both Judge Herman and Judge Burwell. Judge Herman denied all of the motions to recuse, including the motion to recuse directed at him. Judge Wood then held a bench trial and signed a final judgment.

Relator and two other parties appealed Judge Wood's judgment. Among other issues, they asserted that Judge Wood's judgment was void because Judge Herman erred in ruling on a motion to recuse Judge Herman. This court held that Judge Herman erred when he ruled on a motion to recuse directed at him. Guilbot v. Estate of Gonzalez, 267 S.W.3d 556, 561 (Tex. App.- Houston [14th Dist.] 2008, pet. filed). Because Judge Herman erroneously ruled on the motion to recuse directed at him, this court concluded that Judge Herman's order denying the motion to recuse Judge Wood was void.

Because a recusal motion was pending against Judge Wood when he signed the final judgment, Judge Wood's judgment also was void. Id.

While the appeal from the original suit was pending, relator filed a second suit on December 21, 2007, in the 295th District Court of Harris County against the real parties in interest. The second suit asserted that the will at issue was forged and was procured through fraud. On March 27, 2009, the real parties in interest filed a motion to transfer the second suit to Probate Court No. 2 on grounds that the issues were identical to those in the original case tried in Judge Wood's court. The motion to transfer was set for a hearing on April 17, 2009. On April 15, 2009, relator filed a motion to recuse Judge Wood. On April 17, 2009 Judge Wood signed an order granting the real parties' motion to transfer the case to Probate Court No. 2.

On June 18, 2009, Judge Wood signed an order denying relators' motion to recuse him. On June 19, 2009, Judge Wood signed an order referring the recusal to Judge Guy Herman, presiding judge of the statutory probate courts.

Relator challenges Judge Wood's orders of April 17, 2009, June 18, 2009, and June 19, 2009. Relators contend these orders are void because Judge Wood did not recuse himself in response to the April 15, 2009 recusal motion and did not refer that motion to the presiding judge.

Generally speaking, mandamus relief is available upon a showing that (1) the trial court abused its discretion; and (2) there is no other adequate remedy in law. See Walker v. Packer, 827 S.W.2d 833, 839-40 (Tex. 1992).

With respect to the first prong, a trial court abuses its discretion when it clearly fails to correctly analyze or apply the law. In re Cerberus Capital Mgmt., L.P., 164 S.W.3d 379, 382 (Tex. 2005).

With respect to the second prong, “Texas law has long held that mandamus will issue where the trial court's order is void and that it is unnecessary for a relator to pursue other available remedies." South Main Bank v. Wittig, 909 S.W.2d 243, 244 (Tex. App.- Houston [14th Dist.] 1995, orig. proceeding).

Denial of a motion to recuse is appealable upon final judgment. Tex. R. Civ. P. 18a(f). Thus, a relator challenging the denial of a recusal motion ordinarily has an adequate remedy by appeal of the denial of a motion to recuse. However, mandamus relief is available when a judge violates a mandatory duty to recuse or refer a motion to recuse. In re Norman, 191 S.W.3d 858, 860 (Tex. App.- Houston [14th Dist.] 2006, orig. proceeding).

Analysis

Under Rule 18a, Judge Wood had a mandatory duty to recuse himself or to refer the recusal motion to the presiding judge. Tex. R. Civ. P. 18a. The real parties in interest contend that Judge Wood properly granted the motion to transfer and denied the recusal motion because the motion was not timely filed pursuant to section 25.00255 of the Government Code.

Under section 25.00255, a recusal motion must (1) be filed at least 10 days before the date of a hearing or trial; (2) be verified: and (3) state with particularity the alleged grounds for recusal. Tex. Gov't Code Ann. § 25.00255(b) (Vernon Supp. 2009). Real parties contend that Judge Wood was entitled to deny relator's April 15, 2009 recusal motion because it was filed only two days before the hearing on the motion to transfer.

Regardless of whether a motion to recuse may be defective or untimely, the challenged judge must recuse or refer the motion so that another judge can determine the procedural adequacy and merits of the motion. Norman, 191 S.W.3d at 861.

Judge Wood did not have the option of denying the motion to recuse as untimely. Jamilah v. Bass, 862 S.W.2d 210, 203 (Tex. App.- Houston [14th Dist.] 1993, orig. proceeding) (The trial judge must recuse himself or refer the motion to the presiding judge “regardless of the timeliness of the motion.").

Thus, we hold that Judge Wood abused his discretion by signing (1) the April 17, 2009 order granting the motion to transfer; and (2) the June 18, 2009 order denying the motion to recuse.

Both orders are void, and mandamus is the appropriate remedy to address these void orders. In re Norman, 191 S.W.3d at 860. The June 19, 2009 order referring the recusal motion to the presiding judge is proper, and that order stands.

Conclusion

Because the orders signed on April 17, 2009 and June 18, 2009 are void, we conditionally grant the writ of mandamus. The writ will issue only if the trial court fails to vacate the orders signed on April 17, 2009 and June 18, 2009.

/s/ John S. Anderson

Justice

Panel consists of Chief Justice Hedges and Justices Anderson and Boyce.

In Re Guilbot (Tex.App.- Houston [14th Dist.] Nov. 3, 2009)(Anderson)(motion to recuse trial judge) (Probate court judge did not have the option of denying the motion to recuse as untimely).
MOTION OR WRIT GRANTED: Opinion by Justice John Anderson
Before Chief Justice Hedges, Justices Anderson and Boyce
14-09-00595-CV In Re Miguel Angel Gonzales Guilbot
Appeal from Probate Court No 2 of Harris County
Trial Court Judge: Michael James Wood

Does Promissory Estoppel Claim Support Attorney Fee Award?

Are attorney's fees available on a successful promissory estoppel claim? The answer is not so clear as the courts of appeals are divided on the issue. Worse, the two Houston Courts of Appeals are on opposite sides of the divide, thus putting the courts below in the quandry of which authority to follow. Rather than resolving the issue - or calling upon the Supreme Court to do so for the benefit of all Texas courts and appellate jurisdictions - the First Court of Appeals here affirms attorney's fees on more conventional grounds sanctioned by statute: breach of contract.

Attorney’s fees challenge

Basis for fee award

Prince contends that the trial court erred in awarding QAI its attorney’s fees because Texas law does not allow an award of attorney’s fees based on a claim of promissory estoppel. Prince recognizes that Texas courts currently are split on this issue. Compare Doctors Hosp. 1997, L.P. v. Sambuca Houston, L.P., 154 S.W.3d 634, 635–38 (Tex. App.—Houston [14th Dist.] 2004, pet. abated) (holding that attorney’s fees are not recoverable under Tex. Civ. Prac. & Rem. Code § 38.001(8) for promissory estoppel claim because such claims presuppose no “oral or written contract”) (quoting Subaru of Am., Inc. v. David McDavid Nissan, Inc., 84 S.W.3d 212, 226 (Tex. 2002) (“promissory estoppel doctrine presumes no contract exists”)) with Preload Tech., Inc. v. A.B. & J. Constr. Co., 696 F.2d 1080, 1094–95 (5th Cir. 1983) (upholding attorney’s fees awarded under Texas law for promissory estoppel claim); Traco, Inc. v. Arrow Glass Co., 814 S.W.2d 186, 194–95 (Tex. App.—San Antonio 1991, writ denied); Safe Env’t v. Pelzel & Assocs., Inc., No. 3-09-00721-CV, 1999 WL 815819, at *31999 Tex. App. LEXIS 7628 (Tex. App.—Austin 1999, no pet.) (mem. op.).

Our precedent on this issue is contrary to the Fourteenth Court of Appeals’ decision in Sambuca. See Adams v. Petrade Int’l, 754 S.W.2d 696, 720 (Tex. App.—Houston [1st Dist.] 1988, writ denied). Nevertheless, we need not reconsider our position, because the trial court’s judgment does not specify the theory under which fees were awarded, and the trial court’s findings of fact and conclusions of law provide a contractual basis for the attorney’s fee award. Specifically, the trial court found that [...]

In its counterclaim, QAI sought its attorney’s fees as relief. The trial court’s findings of fact and conclusions of law support an award of attorney’s fees under the Civil Practice and Remedies Code. See Tex. Civ. Prac. & Rem. Code Ann. § 38.001(8) (Vernon 2008) (allowing for recovery of reasonable attorney’s fees on claim for oral or written contract). The findings identify an agreement among the parties; Prince’s breach of that agreement; and damages incurred by QAI resulting from that breach. The issue of whether the cash flow statement was a settlement agreement, the breach of which would support an award of attorney’s fees, was tried by consent. See Tex. R. Civ. P. 67. Prince does not challenge any of the trial court’s findings of fact and conclusions of law.

We conclude that the fee award does not rest on a promissory estoppel theory. We hold that the applicable statutory authority and the evidence support the trial court’s award of attorney’s fees.

Lee-Way Prince Enterprises, LLC v. Qai Assurance, Inc. (Tex.App.- Houston [1st Dist.] Oct. 29, 2009)(Bland)(award of attorney’s fees on contract breach attorney's fees for promissory estoppel claim, breach of ontract, breach of settlement agreement, common-law fraud)
AFFIRM TC JUDGMENT: Opinion by Justice Bland
Before Chief Justice Radack, Justices Bland and Massengale
01-07-01004-CV Lee-Way Prince Enterprises, LLC v. Qai Assurance, Inc. and Arthur Kwok
Appeal from 269th District Court of Harris County
Trial Court Judge: Hon. John T. Wooldridge

CONSUMER INFO & WEB LIBEL: Negative Product Review Survives Defamation and Biz Disparagement Suit

SHODDY-PRODUCT LIBEL SUIT FAILS UNDER "THE GIST" TEST

First Court of Appeals rules for publisher of critical review of company's product on the Internet, finding that the defamation and business disparagement claims could not succeed under the "substantial truth" defense.

FROM THE OPINION BY JUSTICE TERRY JENNINGS

in David Rafes, Inc. v. Michael Huml and Slowboy Racing, Inc. (Tex.App.- Houston, 10/29/09)

To maintain a cause of action for defamation, a plaintiff must establish that the defendant (1) published a statement about the plaintiff; (2) that was defamatory; (3) while acting with either actual malice, if the plaintiff was a public official or public figure, or negligence, if the plaintiff was a private individual, regarding the truth of the statement. WFAA-TV v. McLemore, 978 S.W.2d 568, 571 (Tex. 1998); Henriquez v. Cemex Management, Inc., 177 S.W.3d 241, 251 (Tex. App.--Houston [1st Dist.] 2005, pet. denied); Grotti v. Belo Corp., 188 S.W.3d 768, 774 (Tex. App.--Fort Worth 2006, pet. denied). "The truth of the statement in the publication on which an action for libel is based is a defense to the action." Tex. Civ. Prac. & Rem. Code Ann. § 73.005 (Vernon 2005).

A defendant may also defeat a libel claim by establishing the substantial truth of the statement. Grotti, 188 S.W.3d at 774 (citing McIlvain v. Jacobs, 794 S.W.2d 14, 15-16 (Tex. 1990)). To determine if a publication is substantially true, "we consider whether the alleged defamatory statement was more damaging to the plaintiff's reputation, in the mind of the average person, than a truthful statement would have been," and "[w]e look at the 'gist' of the publication "to determine whether it is substantially true." Id. (citations omitted). The defense of truth does not require proof that the alleged defamatory statement is literally true in every detail; substantial truth is sufficient. Gustafson v. City of Austin, 110 S.W.3d 652, 656 (Tex. App.--Austin 2003, pet. denied); Howell v. Hecht, 821 S.W.2d 627, 631-32 (Tex. App.--Dallas 1991, writ denied).

Here, the trial court heard sufficient evidence to support an implied finding that the turbocharger was defective, or, as the trial court bluntly summarized, a "bad product." The trial court also heard sufficient evidence to support an implied finding that the statements made in the internet article were true, or, even if not literally true in every detail, substantially true. For example, Johnston, Huml and Slowboy's expert, who was an independent consultant for turbocharger engineering issues and patent consulting, (4) testified that he reviewed the internet article and Rafes's turbocharger and that the "main concerns" expressed by Huml regarding Rafes's turbocharger in the internet article "were all valid." Johnston further explained that he also had "serious concerns" about "every part" of the turbocharger about which Huml had raised concerns and most of his concerns were "for the same reasons" generally expressed by Huml in the article. Johnston further stated that he had additional "serious concerns" about other design and manufacturing problems associated with Rafes's turbocharger that Huml had not identified in the article. After Johnston had explained his concerns about these additional problems with the turbocharger, the trial court initially stated that it wanted to focus on statements contained in the article, but then stated that it agreed that evidence of these additional problems was relevant to the issue of damages.

Regarding the specific statements made in the internet article, Johnston agreed that the turbocharger had been reproduced with a part number from a competing Mistsubishi turbocharger product and that "using the exact same part number would be intended to cause confusion in the marketplace and was a slippery slope from a legal standpoint." Johnston stated that Rafes should have not have reproduced the exact same part number on its turbocharger because it left the impression that Rafes was "intentionally trying to cause confusion." Johnston also stated, consistent with Huml's remarks in the article, that there were strong reasons to be concerned about the quality of materials used by the parties that had produced Rafes's turbocharger in Taiwan.

Regarding the specifications of the turbocharger that Huml discussed and criticized in the internet article, Johnston stated that Huml's concerns about the blade's thickness and weight were all reasonable. Regarding the thickness of the blade used on Rafes's turbocharger compared to the thickness of the blade on the genuine Mitsubishi product, Johnston explained that this indicated a lack of "casting quality control" on Rafes's part and, given the fact that Rafes's blade was twice as thick, Rafes must have used "low cost methods of manufacturing it." When asked whether he agreed with the statement in the article that the material used in Rafes's turbocharger would not hold up to the heat and abuse of a typical user, Johnston explained that if the part had an air pocket it in it, which he considered as a potential explanation for the blade's weight difference from that used in the genuine Mitsubishi product, this could lead to immediate or long term failure of the turbocharger.

Johnston, like Huml, believed that parts of Rafes's turbocharger were inferior based upon coloration differences, and he stated that his conclusions regarding the inferiority of the parts were later confirmed. He also stated that it was reasonable, based upon common industry knowledge, for Huml to raise concerns about the quality of the turbocharger based upon these coloration observations.

During his testimony, Johnston agreed that there were some inaccuracies in the internet article. For example, when asked about the specific statement in the article that Rafes's turbocharger was made of some type of "powdered metal," Johnston remarked that Huml had likely intended to refer to a "powdery surface," but Johnston explained this distinction and the likely intent of Huml's statement. Johnston also admitted to other inaccuracies in the internet article, but based upon Johnston's testimony, the trial court would have been entitled to conclude that such inaccuracies were minor. The testimony reveals that Johnston considered these inaccuracies to be insignificant. Additionally, in concluding his testimony, Johnston opined that Huml's Conclusions and actions were reasonable when compared to the standard of a quality assurance inspector in the industry.

An abstract of Johnston's expert report was also introduced into evidence. In the abstract of this report, Johnston stated, after detailed explanation, that "Huml's essential comments and concerns were both technically correct, and reasonable." Johnston further explained that, in evaluating the turbocharger, Huml had used "common industry practice" by comparing the color of the turbocharger with a known standard part. Johnston also noted in the article that Huml simply identified possible critical noncomplying components, but stressed that Rafes had recommended further scientific analysis, and Rafes alerted users to use caution pending further analysis. We recognize that Rafes presented testimony to dispute Huml's and Johnston's testimony. Rafes also presented an expert who compared Rafes's turbochager against the internet article and disputed the accuracy of many of the statements made in the article. However, the competing experts in this case disagreed on several important points, and Johnston challenged the accuracy of Rafes's expert's opinions. Johnston specifically testified that Rafes's expert had made at least three mistakes in examining the turbocharger and preparing his findings. The trial court heard all of this evidence, including the evidence from the dueling experts regarding the accuracy of the statements in the internet article, and the trial court, as the sole judge of the credibility of the witnesses, was entitled to accept or reject all or any part of the witnesses' testimony. Rich, 274 S.W.3d at 884.

Moreover, from our review of the record, it is clear that the trial court could have disbelieved at least some of the testimony presented by Rafes and his expert. For example, although Rafes offered an explanation as to why it used as a product number on its turbocharger the product number used on the Mitsubishi product, the trial court was not required to believe this explanation. Moreover, the trial court could have determined that the testimony provided by Rafes and his employee about an internet advertisement for the turbocharger was
equivocal and lacked credibility. Huml and Slowboy also introduced other evidence, including consumer correspondence, that indicated that at least some consumers had been confused about the origin of Rafes's turbocharger and whether it was a genuine Mitsubishi product or a product designed and or manufactured, at least in part, by Rafes.

In sum, the trial court was presented with ample evidence substantiating the "gist" of the statements contained in the internet article regarding the production and manufacturing of the turbocharger. Accordingly, we hold that the evidence is legally and factually sufficient to support the trial court's implied finding that Rafes's claims against Huml and Slowboy were barred by the affirmative defense of substantial truth.

David Rafes, Inc. v. Huml (Tex.App.- Houston [1st Dist.] Oct. 29, 2009)(Jennings)
(defamation business disparagement loss of reputation and goodwill claim regarding product quality, tortious interference with prospective business relationships, substantial truth defense to defamation claim carries the day)
AFFIRM TC JUDGMENT: Opinion by Justice Jennings
Before Justices Jennings, Higley and Sharp
01-08-00856-CV David Rafes, Inc. v. Michael Huml and Slowboy Racing, Inc.
Appeal from 11th District Court of Harris County
Trial Court Judge: Hon. Mark Davidson

Caveat Counsel: Cursory Attorney's Fee Testimony Found Insufficient

CAUTIONARY TALE: FEE AWARD THROWN OUT FOR LACK OF PROPER EVIDENCE TO SUPPORT IT.

Message to the Plaintiff's bar from higher realms above: Be careful how you go about proving up reasonable and necessary attorney's fees in a contingency fee case. Just establishing the existence of a contingency fee contract and a few resume items will not do.

MIND THE ARTHUR ANDERSEN FEE FACTORS

Attorney's Fees

In its first issue, O&B asserts that the evidence is legally insufficient to support an award of attorney's fees. The jury was asked to determine “a reasonable fee for the necessary services" of appellees' attorney and awarded $3,350. O&B argues the evidence is insufficient to show that amount was reasonable and necessary.

Appellees' attorney's testimony in support of attorney's fees was very brief. After stating where he went to law school, counsel testified that he had been practicing law for eight years, “was familiar with rates . . . charged by attorneys," and had spent about 172 hours on the case. He explained that he had a contingent fee contract with the appellees that provided he would receive one-third of any recovery as his fee.

This evidence is insufficient to support an award of attorney's fees.

The jury was asked to award reasonable and necessary attorney's fees, but appellees did not provide sufficient evidence for the jury to evaluate what was reasonable and necessary.

A contingent fee agreement alone is not a sufficient basis to determine an appropriate fee award. See Arthur Andersen & Co. v. Perry Equip. Corp., 945 S.W.2d 812, 818-19 (Tex. 1997); San Antonio Credit Union v. O'Connor, 115 S.W.3d 82, 105-06 (Tex. App.-San Antonio 2003, pet. denied).

That a plaintiff and his attorney agree on a fee does not establish that such a fee is reasonable and appropriate to shift to the defendant. Arthur Andersen, 945 S.W.2d at 818. Rather, a plaintiff must request a specific amount of fees, not a percentage of the damages, and must show that the amount requested is reasonable and necessary. See id. at 819; Castle Tex. Prod. Ltd. P'ship v. Long Trusts, 134 S.W.3d 267, 278-79 (Tex. App.-Tyler 2003, pets. denied); San Antonio Credit, 115 S.W.3d at 106.

Factors to consider when determining if a fee request is reasonable are:

(1) the time and labor required, the novelty and difficulty of the questions involved, and the skill required to perform the legal service properly;

(2) the likelihood . . . that the acceptance of the particular employment will preclude other employment by the lawyer;

(3) the fee customarily charged in the locality for similar legal services;

(4) the amount involved and the results obtained;

(5) the time limitations imposed by the client or by the circumstances;

(6) the nature and length of the professional relationship with the client;

(7) the experience, reputation, and ability of the lawyer or lawyers performing the services; and

(8) whether the fee is fixed or contingent on results obtained or uncertainty of collection before the legal services have been rendered.

Arthur Andersen, 945 S.W.2d at 818 (quoting Tex. R. Disciplinary P. 1.04, reprinted in Tex. Gov't Code Ann., tit. 2, subtit. G app. A-1 (Vernon 2005) (alteration in original)).

Counsel's bare testimony of the name of his law school, his years practicing, and the hours he worked on the case does not establish that any particular fee is reasonable. Indeed, though he testified he is familiar with the rates attorneys charge, he did not specify to which attorneys he was referring and never stated that their fees are reasonable. Further, he did not request a specific amount of fees, instead testifying that appellees had agreed to pay him a percentage of their recovery. [2]

We conclude that this evidence is legally insufficient to give the jury a basis for determining that any amount of attorney's fees was reasonable and necessary. See Arthur Andersen, 945 S.W.2d at 819; see also San Antonio Credit, 115 S.W.3d at 106-07 (rendering take nothing judgment on attorney's fees claim, noting claimant relied on contingent fee and did not present evidence “that a specific amount of money was a reasonable attorney's fees award"). We sustain O&B's first issue.

SOURCE: O and B Farms, Inc.v. Black (Tex.App.- Houston [14th Dist.] Oct. 29, 2009)(Yates) (fraud and civil conspiracy claims award of attorney's fees, exemplary damages reversed) (breach of contract damages proven)(contingency fee contract insufficient to establish reasonable attorney's fees) (detrimental reliance as element of fraud cause of action)
AFFIRMED AS MODIFIED: Opinion by Justice Brock Yates
Before Chief Justice Hedges, Justices Brock Yates and Frost
14-08-00595-CV O and B Farms, Inc., and B and O Farms, LLC v. Eldon Jay Black, Kevin Lee
Donahoo, Thomas David Horrell, Jr., Charles Richard Weeks, Ronald Russell Swisshelm, and Casey Ross Gray
Appeal from 220th District Court of Hamilton County
Trial Court Judge: Hon. James E. Morgan

Voluntary Support Payments to Ex-Wife Treated as Fraud on Subsequent Common-Law Wife

It's been said "No good deed will go unpunished."

Ex-husband continued to support ex-wife so she could finish school. In her own divorce, subsequent common-law wife succeeds (on appeal) in claiming that the payments to ex no. 1 amount to fraud on the community estate. Husband had not agreed to make the monthly payments to the first ex-wife as part of the divorce settlement and was thus under no legal obligation to do so.

The lesson: He should have spent the money on himself!

FROM THE OPINION BY CHIEF JUSTICE ADELE HEDGES:

Payments to Ex-Wife

Monica asserts that the trial court erred in failing to reimburse the community estate for the community funds Bobby used to pay his ex-wife.

A fiduciary duty exists between a husband and a wife as to the community property controlled by each spouse. Zieba, 928 S.W.2d at 789. The breach of a legal or equitable duty which violates this fiduciary relationship existing between spouses is referred to as "fraud on the community," a judicially created concept based on the theory of constructive fraud. Id.

Any such conduct in the marital relationship is termed fraud on the community because, although not actually fraudulent, it has all the consequences and legal effects of actual fraud because such conduct tends to deceive the other spouse or violate confidences that exist as a result of the marriage. Id.

A presumption of constructive fraud arises where one spouse disposes of the other spouse's one-half interest in community property without the other's knowledge or consent. Id.; Jackson v. Smith, 703 S.W.2d 791, 795 (Tex. App.-Dallas 1985, no writ). In that circumstance, the burden of proof to show fairness in disposing of community assets is upon the disposing spouse. See Zieba, 928 S.W.2d at 789; Morrison v. Morrison, 713 S.W.2d 377, 379 (Tex. App.-Dallas 1986, writ dism'd).

In considering a claim of constructive fraud, the court may consider three factors: (1) the size of the gift in relation to the total size of the community estate; (2) the adequacy of the remaining estate; and (3) the relationship of the donor to the donee. Zieba, 928 S.W.2d at 789.

Monica testified that, in May 1996, she discovered that Bobby had been paying his ex-wife $500 a month for approximately eighteen months. She further testified that Bobby's checkbook reflected that he had made the last payment in July 1995. Bobby testified that Monica knew about the payments to his ex-wife when they first began dating, but admitted later telling her that he had stopped the payments. He further admitted that he paid his ex-wife longer than required to do so by the court so that he could help her finish college and obtain a degree. There is no mention of these payments in the final decree or in the court's findings of fact and conclusions of law.

The trial court found that the parties had entered into an informal marriage on July 10, 1994. Monica presented uncontroverted evidence that Bobby paid his ex-wife $500 a month until July 1995. There is no evidence to suggest, nor does Bobby contend, that he used separate property funds to pay his ex-wife and, thus, we presume that community funds were used. See Smith v. Smith, 22 S.W.3d 140, 144 (Tex. App.- Houston [14th Dist.] 2000, no pet.) (noting that to overcome community property presumption, spouse claiming certain property as separate property must trace and clearly identify property claimed to be separate). Although Bobby testified that Monica knew about the payments when they first started dating, there is no evidence that Monica consented to the payments after they became common law married. See
Zieba, 928 S.W.2d at 790 (finding trial court abused its discretion in refusing to reimburse community for husband's $100,000 cash withdrawal from bank account where there was no evidence wife consented to withdrawal although wife testified she knew about withdrawal and did not question husband about it). Moreover, Bobby admitted having deceived Monica about the payments and testified that he continued to pay his ex-wife longer than ordered to do so by the court. Cf. Zieba, 928 S.W.2d at 790 (finding no fault with trial court's refusal to reimburse community for funds spent by husband on obligations arising from prior marriage because obligations were imposed on husband by court order).

When asked why he continued to pay his ex-wife during his marriage to Monica, Bobby testified that his ex-wife was not receiving help from anyone else and he wanted to help her obtain her degree.

We conclude that the trial court should have reimbursed the community for the payments to Bobby's ex-wife made between July 1994 and July 1995, and awarded Monica's community assets one-half of the value.

Its refusal to do so was an abuse of discretion. See id.[9]

Knight v. Knight (Tex.App.- Houston [14th Dist.] Oct. 29, 2009)(Hedges)
(divorce property division, reimbursement claim, preservation of error for appellate review)
AFFIRMED IN PART; REVERSED & REMANDED IN PART: Opinion by Chief Justice Hedges
Before Chief Justice Hedges, Justices Brock Yates and Frost
14-08-00424-CV Monica Faye Knight v. Bobby Wayne Knight
Appeal from 246th District Court of Harris County
Trial Court Judge: Jim York

Small Claims Court Case Limited to One Appeal (under old law)

HOUSTON COURT OF APPEALS DISMISSES APPEAL FROM COUNTY COURT'S DE NOVO DECISION IN SMALL CLAIMS COURT CASE FOR WANT OF APPELLATE JURISDICTION, BUT NOTES THAT THE LAW GOVERNING SUCH APPEALS HAS RECENTLY CHANGED.

Also see prior post:
No Mandamus Jurisdiction over Judge of Small Claims Court

MEMORANDUM OPINION

This attempted appeal arises from a lawsuit originally filed in small claims court[1] in Shelby County. The justice of the peace rendered a judgment against appellant, Abraham Melawer, which he then appealed to the county court for a trial de novo. See Tex. Gov’t Code Ann. § 28.053(b) (Vernon 2004 & Supp. 2009). The county court judge likewise found in favor of appellee, Robert S. Tipton, and entered a judgment against Melawer. Appellant responded by filing this appeal complaining of the county court’s judgment.

However, under section 28.053(d) of the Texas Government Code, we lack jurisdiction to consider the merits of Melawer’s appeal because this case was originally filed in small claims court. See Sultan v. Mathew, 178 S.W.3d 747, 749–50 (Tex. 2005) (“[W]e conclude that by declaring in section 28.053(d) that the ‘judgment of the county court or county court at law is final,’ the Legislature intended to prohibit appeals to the courts of appeals.”).[2]

Accordingly, we must dismiss this appeal for want of jurisdiction.[3] See id. at 752–53.

/s/ Kent C. Sullivan

Justice

Panel consists of Chief Justice Hedges, and Justices Seymore and Sullivan.

[1] We note that some of the documents filed by Melawer contain the caption, “IN THE JUSTICE COURT OF SHELBY COUNTY, TEXAS.” See Tex. Gov’t Code Ann. §§ 28.002–.003 (Vernon 2004 & Supp. 2009) (providing for concurrent jurisdiction between small claims court and justice court, and specifying that a justice of the peace also sits as the judge in small claims court). However, the caption of the lawsuit petition filed by appellee, Robert S. Tipton, reads “Small Claims – Statement of Claim” and is followed by the notation “TEX. GOV’T CODE ANN. 28.012.” Section 28.012 provides the form for a small-claims petition, and Tipton’s Statement of Claim closely tracks that requisite form. See id. § 28.012(b) (Vernon 2004). The citation also commanded Melawer to appear “before the Small Claims Court” and was signed by the Shelby County Justice of the Peace in his capacity as judge of the small claims court. Further, the record does not indicate that the case was transferred from the small claims court to the justice court. Thus, notwithstanding Melawer’s suggestion to the contrary in his trial-court pleadings, we conclude this case was filed in small claims court. See Lister v. Walters, 247 S.W.3d 381, 383 (Tex. App.—Texarkana 2008, no pet.).

[2] After this case was filed, the Texas Legislature amended the Government Code to confer jurisdiction on an appellate court to review a county court’s judgment following a de novo appeal from small claims court. See Act of June 1, 2009, 81st Leg., R.S., ch. 1351, § 9, 2009 Tex. Sess. Law Serv. 4271, 4273 (Vernon) (to be codified at Tex. Gov’t Code Ann. § 28.053(d)). However, the Legislature expressly limited the scope of that amendment to apply only to actions filed after September 1, 2009. See id. §§ 14, 15, 2009 Tex. Sess. Law. Serv. at 4280–81. Therefore, this case, which was filed before the effective date of the amendment, is still governed by the previous version of section 28.053(d) discussed in Sultan. See id. § 14, 2009 Tex. Sess. Law Serv. at 4280. [EMPHASIS ADDED, OTHER FOOTNOTE OMITTED]

Melawer v. Tipton (Tex.App.- Houston [14th Dist.] Oct. 29, 2009)(Sullivan)
(attempted appeal arises from a lawsuit originally filed in small claims court; dismissed for lack of
appellate jurisdiction under law in effect prior to recent enactment permitting appeal)
DISMISSED-WANT OF JURISDICTION: Opinion by Justice Sullivan
Before Chief Justice Hedges, Justices Seymore and Sullivan
14-08-00721-CV Abraham Melawer v. Robert S. Tipton
Appeal from County Court of Shelby County
Trial Court Judge: Judge Shelby County