1 

NO. 13-16-00099-CV

________________________________________________________

IN THE COURT OF APPEALS

FOR THE THIRTEENTH DISTRICT

AT CORPUS CHRISTI/EDINBURG, TEXAS

________________________________________________________

FIRST CASH, LTD

VS

JQ-PARKDALE, LLC, H&JQ PD, LLC, 

W-SB STAPLES/SPID LLC, R-SB STAPLES/SPID, LLC,

PARKDALE INCOME PARTNERS, LP, & CAPITOL AREA

RETAIL DEVELOPMENT, II, INC.

________________________________________________________

AN APPEAL FROM THE 319th COURT

OF NUECES COUNTY, TEXAS

________________________________________________________

CROSS-APPELLEES’ BRIEF 

FOR JQ-PARKDALE, LLC, H&JQ PD, LLC, 

W-SB STAPLES/SPID LLC, and R-SB STAPLES/SPID, LLC

________________________________________________________

John Runde

Tx Bar # 24093084

Eric Stewart

Tx Bar # 24058133

HUSEMAN & STEWART

615 N. Upper Broadway #2000

Corpus Christi, Tx 78401

Tel: 361.883.3563

ORAL ARGUMENT IS REQUESTEDFax: 361.883.0210

JRunde@HusemanStewart.com

EStewart@HusemanStewart.com

ACCEPTED

13-16-00099-CV

THIRTEENTH COURT OF APPEALS

CORPUS CHRISTI, TEXAS

12/30/2016 10:09:11 PM

Dorian E. Ramirez

CLERK

 FILED IN 13th COURT OF APPEALS CORPUS CHRISTI/EDINBURG, TEXAS 1/3/2017 8:00:00 AM DORIAN E. RAMIREZ Clerk
2

NAMES AND ADDRESSES OF ALL PARTIES 

APPELLANT/CROSS-APPELLEE:First Cash, ltd.

TRIAL COUNSEL: Mr. Patrick L. Gaas

Mr. Paul Catalano

Mr. Edward S. Hubbard

COATS ROSE YALE RYMAN & LEE, PC

3 East Greenway Plaza, Suite 2000

Houston, TX 77046

Email: pgaas@coatsrose.com

Email: pcatalano@coatsrose.com

Email: ehubbard@coatsrose.com

Mr. Darrell Barger

Mr. Richard Crews

HARTLINE DACUS BARGER DEYER, LLP

800 N. Shoreline Blvd.

Suite 2000, N. Tower

Corpus Christi, TX 78401

Email: dbarger@hdbdlaw.com

Email: rcrews@hdbdlaw.com

APPELLATE COUNSEL: Mr. Edward S. Hubbard

Mr. Patrick L. Gaas

COATS ROSE YALE RYMAN & LEE, PC

3 East Greenway Plaza, Suite 2000

Houston, TX 77046

Email: pgaas@coatsrose.com

Email: ehubbard@coatsrose.com

Mr. Richard Crews

HARTLINE DACUS BARGER DEYER, LLP

800 N. Shoreline Blvd.

Suite 2000, N. Tower

Corpus Christi, TX 78401

Email: rcrews@hdbdlaw.com
3

APPELLEES/CROSS-APPELLANTSJQ-Parkdale, LLC, H&JQ PD, LLC, 

W-SB Staples/SPID LLC, R-SB Staples/SPID LLC

TRIAL COUNSEL: Van Huseman

Eric Stewart

HUSEMAN & STEWART

615 N. Upper Broadway #2000

Corpus Christi, Tx 78401

Tel: 361.883.3563

Fax: 361.883.0210

VHuseman@HusemanStewart.com

EStewart@HusemanStewart.com

APPELLATE COUNSEL: John Runde

Eric Stewart

HUSEMAN & STEWART

615 N. Upper Broadway #2000

Corpus Christi, Tx 78401

Tel: 361.883.3563

Fax: 361.883.0210

JRunde@HusemanStewart.com

EStewart@HusemanStewart.com

APPELLEES: Parkdale Income Partners, LP, and 

Capitol Area Retail Development, II, 

Inc.

TRIAL AND APPELLATE

COUNSEL: 

Paul Dodson

218 Leming Ave.

Corpus Christi, Tx 78404

Tel: 361.364.7415

Fax: 361.237.1963

paul@PaulDodson.net
4

REQUEST FOR ORAL ARGUMENT

JQ-Parkdale, LLC, H&JQ PD, LLC, W-SB Staples/SPID LLC, and RSB Staples/SPID LLC, respectfully request oral argument at the time of submission.
5

TABLE OF CONTENTS

NAMES AND ADDRESSES OF ALL PARTIES................................................ 2

REQUEST FOR ORAL ARGUMENT .................................................................. 4

TABLE OF CONTENTS .......................................................................................... 5

LIST OF AUTHORITIES.......................................................................................... 7

REPLY ISSUE............................................................................................................ 10

Reply Issue: Texas Civil Practice and Remedies Code § 38.001 does not 

authorize recovery of attorney fees from a limited liability company ......... 10

STATEMENT OF FACTS ...................................................................................... 11

SUMMARY OF THE ARGUMENT..................................................................... 11

Texas Civil Practice and Remedies Code § 38.001 does not authorize 

recovery of attorney fees from a limited liability company ........................... 12

Standard of review for JNOV and statutory construction..................... 12

Primary rule of statutory interpretation: if the law is not ambiguous, 

read it literally ................................................................................................ 13

Chapter 38 means what it says: only individuals and corporations can 

be liable for attorney fees, not LLCs ......................................................... 14

LLCs are not corporations................................................................. 14

All of First Cash’s arguments to ignore the wording of § 38.001 

have been rejected ............................................................................... 17

‘Fleming involved a limited partnership’....................................... 17

‘Corporations and limited liability companies are similar’........ 17

‘Attorney fees have been awarded against limited-liability 

entities’.............................................................................................. 18

‘The revision to Article 2226 was nonsubstantive’.................... 19

The Legislature has rejected efforts to amend § 38.001 to include 

non-corporation entities..................................................................... 20
6

Intermediate appellate courts lack the authority to make 

exceptions to the American Rule ...................................................... 22

PRAYER FOR RELIEF ........................................................................................... 23

CERTIFICATE OF SERVICE ............................................................................... 24

CERTIFICATE OF COMPLIANCE .................................................................... 24

APPENDIX ................................................................................................................ 25
7

LIST OF AUTHORITIES

Cases

Akin, Gump, Strauss, Hauer & Feld, L.L.P. v. Nat’l Dev. & Research Corp., 

299 S.W.3d 106 (Tex. 2009)............................................................................. 23

Alta Mesa Holdings, L.P. v. Ives, 488 S.W.3d 438 (Tex. App.—Houston [14th 

Dist.] 2016, pet. denied) ............................................................................. 16, 20

Baylor Health Care Sys. v. Nat’l Elevator Indus. Health Benefit Plan, 2008 

U.S. Dist. LEXIS 4304 (N.D. Tex. 2008)................................................ 17, 21

Box v. Dallas Mexican Consulate Gen., 2014 WL 3952932, 2014 U.S. Dist. 

LEXIS 111751 (N.D. Tex. 2014), aff’d, 623 Fed. Appx. 649 (5th Cir. 

2015), cert. denied, 136 S. Ct. 1729 (2016).................................................... 17

Campbell v. State, 85 S.W.3d 176 (Tex 2002) ...................................................... 20

CBIF Ltd. P’ship v. TGI Friday’s Inc., No. 050-15-00157-CV, 2016 Tex. App. 

LEXIS 12844 (Tex. App.—Dallas 2016, no pet. h.).................................... 16

Choice! Power, L.P. v. Feeley, 2016 WL 4151041, 2016 Tex. App. LEXIS 

8409, (Tex. App.—Houston [1st Dist.] 2016, no pet.)...................15, 16, 20

City of Corpus Christi v. Taylor, 126 S.W.3d 712 (Tex. App.—Corpus Christi 

2004, pet. dism’d) .............................................................................................. 13

City of Keller v. Wilson, 168 S.W.3d 802 (Tex. 2005) ........................................ 13

Combs v. Health Care Servs. Corp., 401 S.W.3d 623 (Tex. 2013).................... 15

Entergy Gulf States, Inc. v. Summers, 282 S.W.3d 433 (Tex. 2009). ............... 14

Epps v. Fowler, 351 S.W.3d 862 (Tex. 2011)....................................................... 23

Exco Operating Co. v. McGee, 2016 WL 4379484, 2016 Tex. App. LEXIS 

8934 (Tex. App.—Houston [1st Dist.] 2016, no pet.) (mem. op.) ............ 17

Fleming & Assocs., L.L.P. v. Barton, 425 S.W.3d 560 (Tex. App.—Houston 

[14th Dist.], pet. denied)............................................................................. 17, 21

Fleming Foods of Tex., Inc. v. Rylander, 6 S.W.3d 278 (Tex. 1999)................ 20

Ganz v. Lyons P’ship, L.P., 173 F.R.D. 173 (N.D. Tex. 1997) ................... 17, 19

Greco v. NFL, 2015 U.S. Dist. LEXIS 96239 (N.D. Tex. 2015)................ 17, 20

Hoffman v. L&M Arts, 2015 US. Dist. LEXIS 27784 (N.D. Tex. 2015). 17, 18, 

19, 20
8

In the Interest of A.M., 101 S.W.3d 480 (Tex. App.—Corpus Christi 2002), 

rev’d, 192 S.W.3d 570 (Tex. 2006).................................................................. 20

In the Interest of M.N., 262 S.W.3d 799 (Tex. 2008) ......................................... 14

Lair v. Horn, 2002 WL 34249735, 2002 Tex. App. LEXIS 2935 (Tex. App.—

Corpus Christi 2002, pet. denied) (mem. op.), cert. denied, 539 U.S. 965 

(2003)................................................................................................................... 20

Marmon v. Mustang Aviation, Inc. 430 S.W.2d 182, (Tex. 1968)..................... 22

Molinet v. Kimbrell, 356 S.W.3d 407 (Tex. 2011) ............................................... 14

Nat'l Liab. & Fire Ins. Co. v. Allen, 15 S.W.3d 525 (Tex. 2000). ...................... 14

Nathan v. Whittington, 408 S.W.3d 870 (Tex. 2013).......................................... 14

Petro. Solutions, Inc. v. Head, 454 S.W.3d 518 (Tex. App.—Corpus Christi 

2011), aff’d in part, rev’d in part, (Tex. 2014)............................................... 23

Reedy v. Pompa, 310 S.W.3d 112 (Tex. App.—Corpus Christi 2010), rev’d, 

(Tex. 2011).......................................................................................................... 14

Riner v. Neumann, 353 S.W.3d 312 (Tex. App.—Dallas 2011, no pet.) ......... 23

SJ Med. Ctr., LLC v. Estahbanati, 418 S.W.3d 867 (Tex. App.—Houston [14th 

Dist.] 2013, no pet.)........................................................................................... 18

St. Luke's Episcopal Hosp. v. Agbor, 952 S.W.2d 503 (Tex.1997)................... 14

Tex. DOT v. Needham, 82 S.W.3d 314 (Tex. 2002)........................................... 14

Tony Gullo Motor I, L.P. v. Chapa, 212 S.W.3d 299 (Tex. 2006). ................... 23

Traxler v. Enrgergy Gulf States, Inc., 376 S.W.3d 742 (Tex. 2012).................. 22

Traxxas, L.P. v. Dewitt, 2015 WL 7777986, 2015 U.S. Dist. LEXIS 161763 

(E.D. Tex. 2015)................................................................................................ 17

United States v. South Buffalo Ry., 333 U.S. 771 (1947).................................... 22

Varel Int'l Indus., L.P. v. PetroDrillbits Int'l, Inc., 2016 WL 4535779, 2016 

Tex. App. LEXIS 9619 (Tex. App.— Dallas 2016, pet. denied) (mem. 

op.)....................................................................................................................... 16

Volkswagen of Am., Inc. v. Ramirez, 159 S.W.3d 897 (Tex. 2004).................. 13

Statutes

TEX. BUS. ORGS. CODE § 1.002.............................................................................. 15
9

TEX. CIV. PRAC. & REM. CODE § 38.001.............................................................. 15

TEX. REV. CIV. STAT. ANN. art. 2226 (Vernon Supp. 1985) (repealed 1985) . 20

Rules

TEX. R. APP. 33 ......................................................................................................... 20

Other Authorities

Robert W. Calvert, “No Evidence” and “Insufficient Evidence” Points of Error, 38 

TEX. L. REV. 361, 366 (1960). ......................................................................... 13

W. Wendell Hall, & al., Hall’s Standards of Review in Texas, 42 ST. MARY’S L. J. 3 

(2010)................................................................................................................... 13
10 

NO. 13-16-00099-CV

________________________________________________________

IN THE COURT OF APPEALS

FOR THE THIRTEENTH DISTRICT

AT CORPUS CHRISTI/EDINBURG, TEXAS

________________________________________________________

FIRST CASH, LTD

VS

JQ-PARKDALE, LLC, H&JQ PD, LLC, 

W-SB STAPLES/SPID LLC, R-SB STAPLES/SPID, LLC,

PARKDALE INCOME PARTNERS, LP, & CAPITOL AREA

RETAIL DEVELOPMENT, II, INC.

________________________________________________________

AN APPEAL FROM THE 319th COURT

OF NUECES COUNTY, TEXAS

________________________________________________________

TO THE HONORABLE COURT OF APPEALS: 

JQ-Parkdale, LLC, H&JQ PD, LLC, W-SB Staples/SPID, LLC, AND 

R-SB Staples/SPID, LLC, file their brief as Cross-Appellants. 

REPLY ISSUE

Texas Civil Practice and Remedies Code § 38.001 does not authorize recovery of attorney fees from a limited liability company. 
11

STATEMENT OF FACTS

First Cash sued its Landlord, four limited liability companies (JQ-Parkdale, LLC, H&JQ PD, LLC, W-SB Staples/SPID LLC, and R-SB Staples/

SPID LLC) jointly, for breach of a written lease and sought attorney fees under 

Chapter 38 of the Civil Practice and Remedies Code. C.R. 48, 52 (Fourth 

Amended Petition). Over objection, the trial court submitted an attorney fee 

question, with the caveat that it did not expect to award any attorney fees to 

First Cash. 20 R.R. 142, 184. The jury made a fact finding on First Cash’s attorney fees, but, following the Landlord’s objection, the trial court declined to 

award fees against those limited liability companies. 2 Supp. C.R. 4, 14-15 

(Court’s Charge), 813 (Defendants’ Amended Motion for Judgment N.O.V.), 

881 (Final Judgment). 

SUMMARY OF THE ARGUMENT

Chapter 38 of the Civil Practice and Remedies Code authorizes an award 

of attorney fees only against individuals and corporations. The Landlord defendants are neither individuals nor corporations; they are limited liability companies. The trial court correctly interpreted Section 38.001 and properly followed the cases dealing with the liability of non-corporate entities under that 

statute when it declined to award attorney fees to First Cash.
12

ARGUMENT

Reply Issue Restated: Texas Civil Practice and Remedies Code § 38.001 does 

not authorize recovery of attorney fees from a limited liability company.

Standards of review for JNOV and statutory construction. Appellate

courts review a judgment notwithstanding the verdict under a legal sufficiency 

standard. City of Keller v. Wilson, 168 S.W.3d 802, 823 (Tex. 2005); W. Wendell 

Hall, & al., Hall’s Standards of Review in Texas, 42 ST. MARY’S L. J. 3, 195-196

(2010). Evidence is legally insufficient if the record reflects one of the following:

• there is a complete absence of evidence of a vital fact, 

• the court is barred by rules of law or of evidence from giving 

weight to the only evidence offered to prove a vital fact, 

• the evidence offered to prove a vital fact is no more than a 

mere scintilla, or 

• the evidence establishes conclusively the opposite of a vital 

fact.

Volkswagen of Am., Inc. v. Ramirez, 159 S.W.3d 897, 903 (Tex. 2004); City of Corpus Christi v. Taylor, 126 S.W.3d 712, 717-18 (Tex. App.—Corpus Christi 2004, 

pet. dism’d); see Robert W. Calvert, “No Evidence” and “Insufficient Evidence” 

Points of Error, 38 TEX. L. REV. 361, 366 (1960).
13

Questions of statutory construction are reviewed de novo. Tex. DOT v. 

Needham, 82 S.W.3d 314 (Tex. 2002); Reedy v. Pompa, 310 S.W.3d 112, 117 (Tex. 

App.—Corpus Christi 2010), rev’d on other grounds, (Tex. 2011)

Primary rule of statutory interpretation: if the law is not ambiguous, read it literally. In construing the language of a statute, the court’s primary goal is to ascertain the legislative intent behind the statute and to interpret 

so as to give effect to that intent. In the Interest of M.N., 262 S.W.3d 799, 802

(Tex. 2008); Nat'l Liab. & Fire Ins. Co. v. Allen, 15 S.W.3d 525, 527 (Tex.

2000). The legislature’s intent is determined primarily from the plain and common meaning of the words used. Nathan v. Whittington, 408 S.W.3d 870, 872

(Tex. 2013); Reedy v. Pompa, 310 S.W.3d at 117. The words the Legislature

chooses “should be the surest guide to legislative intent.” Entergy Gulf States, Inc.

v. Summers, 282 S.W.3d 433, 437 (Tex. 2009).

If the statutory language is unambiguous, courts will typically adopt the 

interpretation supported by the statute's plain meaning. St. Luke's Episcopal 

Hosp. v. Agbor, 952 S.W.2d 503, 505 (Tex.1997); Reedy v. Pompa, 310 S.W.3d at

117.This rules apply unless enforcing the plain meaning of the statute as written

would produce absurd or nonsensical results. Molinet v. Kimbrell, 356 S.W.3d

407, 411 (Tex. 2011). This exception, however, is a “high bar,” “reserved for
14

truly exceptional cases, and mere oddity does not equal absurdity.” Combs v.

Health Care Servs. Corp., 401 S.W.3d 623, 630 (Tex. 2013).

Chapter 38 means what it says: only individuals and corporations

can be liable for attorney fees, not LLCs. First Cash argues it should recover 

its attorney fees pursuant to Chapter 38 of the Civil Practice and Remedies

Code, which allows recovery of “reasonable attorney’s fees from an individual 

or corporation ... if the claim is for ... an oral or written contract.” TEX. CIV.

PRAC. & REM. CODE § 38.001; First Cash’s Appellant’s brief at 14, et seq. In 

making this argument, First Cash ignores the literal wording of the § 38.001

and Texas’s general policy against fee shifting.

LLCs are not corporations. The Landlord’s entities are all limited 

liability companies, not corporations. The word "corporation" has a definite, 

statuto-rily-defined meaning in Texas. Choice! Power, L.P. v. Feeley, 2016 WL 

4151041, 2016 Tex. App. LEXIS 8409, *28 (Tex. App.—Houston [1st Dist.] 

2016, no pet.). Under the Business Organizations Code, a “corporation” 

means an entity governed as a corporation under Title 2 or 7 and includes forprofit, nonprofit, and professional corporations. TEX. BUS. ORGS. CODE §

1.002(14). Title 2 of the Business Organizations Code deals with corporations 

and Title 7 deals with 
15

professional entities. Limited liability companies are governed under Title 3, 

and partnerships are governed under Title 4. Consequently, Chapter 38 literally 

does not apply to First Cash’s claim for attorney fees against the defendant limited liability companies. 

This conclusion, based on the plain meaning of the statute, has been

confirmed by the courts that have reached the issue. “Under the plain language 

of section 38.001, a trial court cannot order limited liability partnerships, limited liability companies, or limited partnerships to pay attorney's fees.” CBIF 

Ltd. P’ship v. TGI Friday’s Inc., No. 050-15-00157-CV, 2016 Tex. App. LEXIS 

12844, *69 (Tex. App.—Dallas 2016, no pet. h.). In support of this conclusion, 

the Dallas Court of Appeals relied on the literal statute and on these decisions: 

• Varel Int'l Indus., L.P. v. PetroDrillbits Int'l, Inc., 2016 WL

4535779, *7, 2016 Tex. App. LEXIS 9619, *20-21 (Tex.

App.— Dallas 2016, pet. denied) (mem. op.) (acknowledging

rule, but finding a fact issue as to whether defendants were

corporations);

1

• Choice! Power, L.P. v. Feeley, 2016 WL 4151041, 2016 Tex. App.

LEXIS 8409, *30 (section 38.001 does not permit recovery

against an L.P.);

1 First Cash does not argue there is a fact issue about the Landlord entities being limited liability companies: “none of the Legacy Landlord entities ... is a limited partnership—

all of them are limited-liability companies.” First Cash’s Appellants’ brief at 17.
16

• Alta Mesa Holdings, L.P. v. Ives, 488 S.W.3d 438, 452-53 (Tex. 

App.—Houston [14th Dist.] 2016, pet. denied) (section 38.001 

does not permit recovery against an L.L.C.); 

• Fleming & Assocs., L.L.P. v. Barton, 425 S.W.3d 560, 574 (Tex. 

App.—Houston [14th Dist.] , pet. denied) (section 38.001 does 

not permit recovery against an L.L.P.)).

The Dallas Court of Appeals might have cited additional cases to the same 

effect: 

• Exco Operating Co. v. McGee, 2016 WL 4379484, *11, 2016 Tex. 

App. LEXIS 8934, *5 (Tex. App.—Houston [1st Dist.] 2016, 

no pet.) (mem. op.) (limited partnership not liable for attorney

fees);

• Traxxas, L.P. v. Dewitt, 2015 WL 7777986, 2015 U.S. Dist. 

LEXIS 161763, * 23-24 (E.D. Tex. 2015) (magistrate mem. 

op.) (limited partnership not liable for attorney fees, citing 

Ganz v. Lyons P’ship, L.P., 173 F.R.D. 173 (N.D. Tex. 1997));

• Hoffman v. L&M Arts, 2015 US. Dist. LEXIS 27784, *25 (N.D. 

Tex. 2015) (limited liability company not liable for attorney

fees); 

• Greco v. NFL, 2015 U.S. Dist. LEXIS 96239, *11-22 (N.D. 

Tex. 2015) (unincorporated association not liable for attorney

fees); 

• Box v. Dallas Mexican Consulate Gen., 2014 WL 3952932, 2014 

U.S. Dist. LEXIS 111751, *5-7 (N.D. Tex. 2014), aff’d, 623 

Fed. Appx. 649, 657 (5th Cir. 2015), cert. denied, 136 S. Ct. 

1729 (2016) (foreign government not liable for attorney fees);

• Baylor Health Care Sys. v. Nat’l Elevator Indus. Health Benefit Plan, 

2008 U.S. Dist. LEXIS 4304 (N.D. Tex. 2008) (ERISA selffunded trust not liable for attorney fees); 
17

• Ganz v. Lyons P’ship, L.P., 173 F.R.D. 173 (N.D. Tex. 1997)

(limited partnership not liable for attorney fees).

All of First Cash’s arguments to ignore the wording of § 38.001 have 

been rejected. The arguments made by First Cash for ignoring the literal wording of Section 38.001 and distinguishing Fleming have all been previously considered and rejected by Texas courts of appeal.

• “Fleming involved a limited partnership.” First Cash Appellant’s

brief at 17. The decisions in Alta Mesa Holdings and Hoffman v. L&M Arts, supra,

rejected this distinction and applied Fleming to limited liability companies. 

• “Corporations and limited liability companies are similar.” First

Cash argues that because LLCs and corporation both provide providing tax 

and liability benefits, they should have the same attorney fee liabilities” First 

Cash Appellant’s brief at 17-18. The court in Hoffman v. L&M Arts considered 

the arguments that a limited liability company could be treated as an “individual”2 or a “corporation” and rejected it. That court recognized that LLCs afford “corporation-like benefit of limited liability but with partnership tax treatment,” but found LLCs are neither corporations nor partnerships. Hoffman,

2 First Cash only argues that an LLC should be treated as a corporation, not an individual. First Cash Appellant’s brief at 18. 
18

2015 U.S. Dist. LEXIS 27784 at 22, citing SJ Med. Ctr., LLC v. Estahbanati, 418 

S.W.3d 867, 874-75 (Tex. App.—Houston [14th Dist.] 2013, no pet). While the 

Business Organizations Code occasionally treats LLCs and corporations the 

same, 

LLCs and corporations are distinct legal entities. Otherwise, there 

would be no need, for example, for Texas law to provide that corporations and LLCs are to be treated the same in certain enumerated circumstances.... Provisions of law that apply to corporations would necessarily pertain to LLCs. 

Hoffman, 2015 U.S. Dist. LEXIS 27784 at 23, citation omitted. Corporations 

and LLCs have some characteristics in common, but they are not identical.

Their similarities provide no basis for departing from the literal wording of § 

38.001. See also Ganz, 173 F.R.D. at 177, where the court found multiple distinctions between a limited partnership and a corporation that precluded treating a limited partnership as a “corporation” for purposes of § 38,001. 

• “Attorney fees have been awarded against limited-liability entities.” First Cash Appellant’s brief at 19, 20 at fn 8. More accurately, attorney 

fees have been awarded against LLCs where the applicability of Chapter 38 to limitedliability entities was not raised or discussed. Cf. Ganz, 173 F.R.D. at 175 (giving “nominal weight” to similar awards—“the courts’ silence suggests there was no issue 

raised or considered about the legality of the awarding of such fees against a 
19

limited partnership”). None of the cases cited by First Cash required those

courts to consider the argument now presented, which was ruled upon by the 

trial court in this case. Issues not raised in the trial court are waived. TEX. R.

APP. 33.1; Campbell v. State, 85 S.W.3d 176, 197 (Tex 2002); Lair v. Horn, 2002 

WL 34249735, 2002 Tex. App. LEXIS 2935, *7-8 (Tex. App.—Corpus Christi 

2002, pet. denied) (mem. op.), cert. denied, 539 U.S. 965 (2003).

• “The revision to Article 2226 was nonsubstantive.” The pre-codification version of Chapter 38 allowed an award of attorney fees for breach of 

contract by “a person or corporation.” TEX. REV. CIV. STAT. ANN. art. 2226 

(Vernon Supp. 1985)(repealed 1985). Codification is generally nonsubstantive, 

but that is not always the rule. Where “specific provisions of a ‘nonsubstantive’ 

codification and the code as a whole are direct, unambiguous, and cannot be 

reconciled with prior law, the codification rather than the prior, repealed statute 

must be given effect.” Fleming Foods of Tex., Inc. v. Rylander, 6 S.W.3d 278, 286 

(Tex. 1999); In the Interest of A.M., 101 S.W.3d 480, 489 (Tex. App.—Corpus 

Christi 2002), rev’d on other grounds, 192 S.W.3d 570 (Tex. 2006). The Fleming 

Foods analysis was cited in several of the decisions rejecting the argument now 

made by First Cash. See Choice! Power, L.P., 2016 Tex App. LEXIS 8409 at * 26; 

Alta Mesa Holdings, L.P. 2016 Tex. App. LEXIS 3872 at *38-40; Greco, 2015 U.S.
20

Dist. LEXIS 96239 at *17; Hoffman v. L&M Arts, 2015 U.S. Dist. LEXIS 27784 

at *27; Fleming & Assocs., L.L.P., 425 S.W.3d at 575; Baylor Health Care Sys., 2008 

U.S. Dist. LEXIS 43044 at *13-15.

The Legislature has rejected efforts to amend § 38.001 to include noncorporation entities. The Texas Legislature has twice considered and twice rejected modifications to allow attorney fees to be awarded against other entities 

under Chapter 38. 

The Fleming Associates decision was handed down in 2014. Thereafter, 

House Bill 230 was introduced in the Texas Legislature; this bill would have 

amended § 38.001(a) to allow recovery of reasonable attorney’s fees, in certain 

cases, from an individual “or other legal entity.” See Appendix 1.3 The Bill 

Analysis states the bill was motivated by “a recent court decision ... that a recovery of attorney’s fees under certain civil practice and remedies provisions is 

inapplicable to partnership, and the parties are concerned that this could also 

be interpreted to mean that the statute is inapplicable to limited partnership and 

3 Exhibits 1-3 can be found through the website of the Legislative Reference Library 

of Texas: http://www.lrl.state.tx.us/legis/billsearch/BillDetails.cfm?legSession=84-

0&billtypeDetail=HB&billNumberDetail=230&billSuffixDetail=&startRow=1&IDlist=&unClicklist=&number=100 (last accessed December 30, 2016). 
21

limited liability companies as well. Appendix 2. Although the bill passed the 

House, it died in the Senate and never became law. Appendix 3. 

In 2011, after the Ganz and Greco decisions, House Bill 274 was proposed to amend § 38.001 and allow reasonable attorney’s fees to “the prevailing 

party with respect to a claim ... from an individual, corporation, or other legal entity” in a breach of contract action. Appendix 4.4 H.B. 274, 82nd Leg., Reg. 

Sess. (Tex. 2011) (as introduced Mar. 10, 2011). The bill analysis indicated the 

amendment would have broadened the scope of § 38.001 to make partnerships, 

limited liability companies, trusts, and other non-corporate legal entities to potential liability for attorney’s fees. Appendix 5. The Bill passed the House, but 

without this particular change to § 38.001. Exhibit 6. H.B. 274 eventually became law, but only after it was amended to remove the proposed changes to § 

38.001. Appendix 7, 8. 

Courts presume the Legislature acts with awareness of relevant case law. 

Traxler v. Entergy Gulf States, Inc., 376 S.W.3d 742 748 (Tex. 2012). Should an interpretation of a statute by the courts be unacceptable to the Legislature, a simple remedy is available by the process of legislative amendment. United States v. 

4 Emphasis added. Exhibits 4-6 can also be found through the website of the Legislative Reference Library of Texas: http://www.lrl.state.tx.us/legis/billsearch/text.cfm?legSession=82-0&billtypeDetail=HB&billNumberDetail=274&billSuffixDetail=&startRow=1&IDlist=&unClicklist=&number=100 (last accessed December 30, 2016). 
22

South Buffalo Ry., 333 U.S. 771, 775 (1947), cited in Marmon v. Mustang Aviation, 

Inc., 430 S.W.2d 182, 186 (Tex. 1968). The Legislature acquiesced in the interpretation of § 38.001 that removes non-corporation entities from liability for 

attorney fees; it is not up to the courts to rule otherwise.

Intermediate appellate courts lack the authority to make exceptions to

the American Rule. Texas follows the American Rule, whereby litigants may recover attorney fees only as provided by statute or contract. Epps v. Fowler, 351

S.W.3d 862, 865 (Tex. 2011); Petro. Solutions, Inc. v. Head, 454 S.W.3d 518, 560

(Tex. App.—Corpus Christi 2011), aff’d in part, rev’d in part on other grounds (Tex. 

2014). This settled principle has been part of the state’s jurisprudence for over

one hundred years. Akin, Gump, Strauss, Hauer & Feld, L.L.P. v. Nat’l Dev. &

Research Corp., 299 S.W.3d 106, 120 (Tex. 2009); Riner v. Neumann, 353 S.W.3d

312, 322 (Tex. App.—Dallas 2011, no pet.). The Texas Supreme Court continues to adhere to the Rule. See, Tony Gullo Motor I, L.P. v. Chapa, 212 S.W.3d 299, 

311 (Tex. 2006). If an exception to the American Rule is to be created from 

whole cloth, that is the job of the Supreme Court, and intermediate courts are 

not at liberty to create equitable exceptions to the Rule. Riner, 353 S.W.3d at 

323.
23

PRAYER FOR RELIEF

WHEREFORE, Appellees pray that this Court deny the relief sought by 

First Cash, for costs of court, and for general relief. 

Respectfully submitted

/s/ John Runde

John Runde

Tx Bar # 24093084

Eric Stewart

Tx Bar # 24058133

HUSEMAN & STEWART

615 N. Upper Broadway #2000

Corpus Christi, Tx 78401

Tel: 361.883.3563

Fax: 361.883.0210

JRunde@HusemanStewart.com

EStewart@HusemanStewart.com
24

CERTIFICATE OF SERVICE

By affixing my signature below, I certify that a true copy of the foregoing 

document was delivered on December 30, 2016, to the following attorneys in 

accordance with the Texas Rules of Appellate Procedure:

Mr. Edward S. Hubbard

Mr. Patrick L. Gaas

COATS ROSE YALE RYMAN & LEE, PC

3 East Greenway Plaza, Suite 2000

Houston, TX 77046

Mr. Richard Crews

HARTLINE DACUS BARGER DEYER, LLP

800 N. Shoreline Blvd.

Suite 2000, N. Tower

Corpus Christi, TX 78401

Paul Dodson

218 Leming Ave.

Corpus Christi, Tx 78404

/s/ John Runde

John Runde

CERTIFICATE OF COMPLIANCE 

The number of words in this document, excluding those provisions described in TEX. R. APP. P. 9.4(i)(1) is 2642. This figure is provided in reliance on 

the word count of the computer program used to prepare this document. 
25 

NO. 13-16-00099-CV

________________________________________________________

IN THE COURT OF APPEALS

FOR THE THIRTEENTH DISTRICT

AT CORPUS CHRISTI/EDINBURG, TEXAS

________________________________________________________

FIRST CASH, LTD

VS

JQ-PARKDALE, LLC, H&JQ PD, LLC, 

W-SB STAPLES/SPID LLC, R-SB STAPLES/SPID, LLC,

PARKDALE INCOME PARTNERS, LP, & CAPITOL AREA

RETAIL DEVELOPMENT, II, INC.

________________________________________________________

AN APPEAL FROM THE 319th COURT

OF NUECES COUNTY, TEXAS

________________________________________________________

APPENDIX

Tab Document Record reference

1 H.B. No. 230 C.R. 835

2 H.B. No. 230 (bill analysis) C.R. 837

3 H.B. No. 230 (actions taken) C.R. 838

4 H.B. No. 274 C.R. 840

5. H.B. No. 274 (bill analysis) C.R. 853

6. H.B. No. 274 (modified) C.R. 856

7. H.B. No. 274 (enacted) C.R. 866

8. H.B. No. 274 (actions taken) C.R. 874
By:AAFarrar H.B.ANo.A230

A BILL TO BE ENTITLED

AN ACT

relating to recovery of attorney ’s fees in certain civil cases.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

SECTIONA1.AASection 38.001, Civil Practice and Remedies

Code, is amended to read as follows:

Sec.A38.001.AARECOVERY OF ATTORNEY ’S FEES. (a) Except as

provided by Subsection (b), a [A] person may recover reasonable

attorney ’s fees from an individual, [or] corporation, or other

legal entity, in addition to the amount of a valid claim and costs,

if the claim is for:

(1)AArendered services;

(2)AAperformed labor;

(3)AAfurnished material;

(4)AAfreight or express overcharges;

(5)AAlost or damaged freight or express;

(6)AAkilled or injured stock;

(7)AAa sworn account; or

(8)AAan oral or written contract.

(b)AASubsection (a) does not authorize the recovery of

attorney ’s fees from the state, an agency or institution of the

state, or a political subdivision of the state. This section does

not affect any other statute regarding the recovery of attorney ’s

fees from the state, an agency or institution of the state, or a

political subdivision of the state.

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84R1790 CAE-F 1

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SECTIONA2.AAThe change in law made by this Act applies only

to an award of attorney ’s fees in an action commenced on or after

the effective date of this Act. An award of attorney ’s fees in an

action commenced before the effective date of this Act is governed

by the law applicable to the award immediately before the effective

date of this Act, and that law is continued in effect for that

purpose.

SECTIONA3.AAThis Act takes effect September 1, 2015.

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84R 14119 15.65.307

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BILL ANALYSIS

H.B. 230

By: Farrar

Judiciary & Civil Jurisprudence

Committee Report (Unamended)

BACKGROUND AND PURPOSE

Interested parties point out that a recent court decision held that a recovery of attorney's fees 

under certain civil practice and remedies provisions is inapplicable to partnerships, and the 

parties are concerned that this could also be interpreted to mean that the statute is inapplicable to 

limited partnerships and limited liability companies as well. H.B. 230 seeks to clarify this matter.

CRIMINAL JUSTICE IMPACT

It is the committee's opinion that this bill does not expressly create a criminal offense, increase 

the punishment for an existing criminal offense or category of offenses, or change the eligibility 

of a person for community supervision, parole, or mandatory supervision.

RULEMAKING AUTHORITY

It is the committee's opinion that this bill does not expressly grant any additional rulemaking 

authority to a state officer, department, agency, or institution.

ANALYSIS

H.B. 230 amends the Civil Practice and Remedies Code to include, in addition to an individual 

and a corporation, other legal entities among the parties to certain civil cases from which a 

person is authorized to recover reasonable attorney's fees. The bill establishes that this provision

does not authorize the recovery of attorney's fees from the state, an agency or institution of the 

state, or a political subdivision of the state and that the recovery of attorney's fees in the 

applicable cases does not affect any other statute regarding the recovery of attorney's fees from 

these state entities.

EFFECTIVE DATE

September 1, 2015.

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Texas Legislature Online

History

Bill: HB 230 Legislative Session: 84(R) Council Document: 84R 1790 CAE-F

Last Action: 05/21/2015 S Left pending in committee

Caption Version: Engrossed

Caption Text: Relating to recovery of attorney's fees in certain civil cases.

Author: Farrar

Sponsor: Ellis

Subjects: Civil Remedies & Liabilities (I0065)

Lawyers (I0515)

ATTORNEY'S FEES (S0202)

House Committee: Judiciary & Civil Jurisprudence

Status: Out of committee

Vote: Ayes=9 Nays=0 Present Not Voting=0 Absent=0

Senate Committee: State Affairs

Status: In committee

Actions: (descending date order)

Viewing Votes: Most Recent House Vote

Description Comment Date Time Journal Page

S Left pending in committee 05/21/2015 

S Considered in public hearing 05/21/2015 

S Scheduled for public hearing on . . . 05/21/2015 

S Referred to State Affairs 05/04/2015 1296

S Read first time 05/04/2015 1296

S Received from the House 04/13/2015 763

H Reported engrossed 04/10/2015 08:03 AM 1530

H Nonrecord vote recorded in Journal 04/09/2015 1449

H Record vote RV#181 04/09/2015 1449

H Passed 04/09/2015 1449

H Read 3rd time 04/09/2015 1449

H Nonrecord vote recorded in Journal 04/09/2015 1442

H Passed to engrossment 04/09/2015 1442

H Read 2nd time 04/09/2015 1442

H Placed on Local, Consent, and Res. Calendar 04/09/2015 

H Considered in Local & Consent Calendars 04/06/2015 

H Comm. report sent to Local & Consent Calendar 03/23/2015 

H Committee report distributed 03/19/2015 02:58 PM 

H Comte report filed with Committee Coordinator 03/19/2015 961

H Reported favorably w/o amendment(s) 03/17/2015 838
H Recommended to be sent to Local & Consent 03/17/2015 

H Considered in public hearing 03/17/2015 

H Left pending in committee 03/10/2015 

H Testimony taken/registration(s) recorded in committee 03/10/2015 

H Considered in public hearing 03/10/2015 

H Scheduled for public hearing on . . . 03/10/2015 

H Referred to Judiciary & Civil Jurisprudence 02/10/2015 11:34 AM 264

H Read first time 02/10/2015 264

H Filed 11/11/2014 

839
By:AACreighton H.B.ANo.A274

A BILL TO BE ENTITLED

AN ACT

relating to attorney ’s fees, early dismissal, expedited trials, and

the reform of certain remedies and procedures in civil actions.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

SECTIONA1.AAChapter 38, Civil Practice and Remedies Code, is

amended by designating Sections 38.001 through 38.006 as Subchapter

A, Chapter 38, Civil Practice and Remedies Code, and adding a

heading to Subchapter A to read as follows:

SUBCHAPTER A. RECOVERY OF ATTORNEY ’S FEES BY PREVAILING PARTY

SECTIONA2.AASections 38.001, 38.002, and 38.006, Civil

Practice and Remedies Code, are amended to read as follows:

Sec.A38.001.AARECOVERY OF ATTORNEY ’S FEES. The prevailing

party with respect to a claim [A person] may recover reasonable

attorney ’s fees from an individual, [or] corporation, or other

legal entity [in addition to the amount of a valid claim and costs,]

if the claim is for:

(1)AArendered services;

(2)AAperformed labor;

(3)AAfurnished material;

(4)AAfreight or express overcharges;

(5)AAlost or damaged freight or express;

(6)AAkilled or injured stock;

(7)AAa sworn account; or

(8)AAan oral or written contract.

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Sec.A38.002.AAPROCEDURE FOR RECOVERY OF ATTORNEY ’S FEES.

Attorney ’s [To recover attorney ’s] fees may be recovered under this

subchapter if [chapter]:

(1)AAthe person seeking to recover attorney ’s fees is

[claimant must be] represented by an attorney;

(2)AAthe claimant presents [must present] the claim to

the opposing party or to a duly authorized agent of the opposing

party; and

(3)AApayment for the just amount owed is [must] not

[have been] tendered before the expiration of the 30th day after the

claim is presented.

Sec.A38.006.AAEXCEPTIONS. This subchapter [chapter] does

not apply to a contract issued by an insurer that is subject to the

provisions of:

(1)AATitle 11, Insurance Code;

(2)AAChapter 541, Insurance Code;

(3)AAthe Unfair Claim Settlement Practices Act

(Subchapter A, Chapter 542, Insurance Code); or

(4)AASubchapter B, Chapter 542, Insurance Code.

SECTIONA3.AAChapter 38, Civil Practice and Remedies Code, is

amended by adding Subchapter B to read as follows:

SUBCHAPTER B. ELECTION REGARDING LITIGATION COSTS

Sec.A38.011.AADEFINITIONS. In this subchapter:

(1)AA"Abusive civil action" means a civil action that a

reasonable person would conclude is an abuse of the civil justice

process.

(2)AA"Claim" means a request for monetary damages filed

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H.B.ANo.A274

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in a civil action, other than a request for reimbursement of

attorney ’s fees or other costs of litigation in a civil action, if

the request is for:

(A)AAdamages for alleged personal injury,

property damage, breach of contract, or death, regardless of the

legal theories or statutes on the basis of which recovery is sought;

or

(B)AAdamages other than for alleged personal

injury, property damage, or death allegedly resulting from any

tortious conduct, regardless of the legal theories or statutes on

the basis of which recovery is sought.

(3)AA"Claimant" means a party who has asserted a claim,

including a plaintiff, counterclaimant, cross-claimant,

third-party plaintiff, or intervenor.

(4)AA"Defendant" means a party against whom a claim has

been made, including a defendant, counterdefendant,

cross-defendant, or third-party defendant.

(5)AA"Financial interest" means a financial interest

held by an attorney under an agreement between the attorney and a

claimant or defendant in which the amount or the payment of the fee

for the attorney ’s legal services is contingent wholly or partly on

the outcome of the civil action.

Sec.A38.012.AAAPPLICABILITY. (a) This subchapter does not

apply to:

(1)AAa class action;

(2)AAa shareholder ’s derivative action;

(3)AAan action brought under the Family Code;

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(4)AAan action to collect workers ’ compensation

benefits under Subtitle A, Title 5, Labor Code; or

(5)AAan action filed in a justice of the peace court.

(b)AAThis subchapter does not apply to a civil action in

which the amount in controversy, including all requests for

damages, reimbursement of attorney ’s fees, and litigation costs, is

less than $100,000 and the claimant has made an election to proceed

under Chapter 29A.

Sec.A38.013.AAELECTION. (a) A defendant may elect to apply

the provisions of this subchapter to any civil action in which a

claimant has asserted a claim against the defendant.

(b)AAAn election under this section must identify each

claimant against whom the election is made. An election may not be

made before the 60th day after the date the defendant filed an

answer to the claimant ’s civil action or within 60 days of the date

of trial. The election must be:

(1)AAin writing;

(2)AAsigned by the attorneys of record of the

defendant;

(3)AAfiled with the papers as part of the record; and

(4)AAserved on all claimants against whom the election

is made.

(c)AAA deadline under this subchapter may be amended or

modified by agreement of the parties or by order of the court in a

discovery control plan as provided by Rule 190, Texas Rules of Civil

Procedure.

Sec.A38.014.AAREVOCATION OF ELECTION. (a) An election made

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under Section 38.013 may be revoked wholly or partly by agreement of

the parties.

(b)AAA revocation under this section must identify the

claimants and defendants for whom the revocation is made. A

revocation may be made at any time before an award is made under

Section 38.016 based on the election. The revocation must be:

(1)AAin writing;

(2)AAsigned by the attorneys of record of all parties to

whom the revocation applies; and

(3)AAfiled as part of the record.

Sec.A38.015.AADISMISSAL OR NONSUIT OF ACTION. If a claimant

against whom an election is made under Section 38.013 nonsuits or

voluntarily dismisses with prejudice the civil action for which the

election is made not later than the 15th day after the date the

claimant was served with the election, the election does not apply

to the nonsuited or dismissed civil action.

Sec.A38.016.AAAWARD OF LITIGATION COSTS. (a) If an election

is made under this subchapter, the prevailing party may recover the

prevailing party ’s litigation costs.

(b)AAThe determination of which party is the prevailing party

is a question of law for the court.

(c)AALitigation costs under this subchapter are costs

directly related to the civil action between the claimant and the

defendant. Litigation costs include:

(1)AAreasonable and necessary attorney ’s fees;

(2)AAreasonable and necessary travel expenses;

(3)AAreasonable fees for not more than two testifying

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expert witnesses; and

(4)AAcourt costs.

(d)AAA fee agreement that results in a fee that is fixed or

contingent on results obtained or uncertainty of collection before

the legal services have been rendered may not be considered in the

determination of the amount of reasonable and necessary attorney ’s

fees.

Sec.A38.017.AALIABILITY OF ATTORNEY. (a) This section

applies to a civil action if:

(1)AAa party is entitled to recover litigation costs

under Section 38.016;

(2)AAthe election under Section 38.013 states that the

party making the election will seek litigation costs under this

section; and

(3)AAan attorney of record for the party against whom

litigation costs are recoverable has a financial interest in the

civil action.

(b)AAIf the trier of fact determines that a civil action is an

abusive civil action, an attorney of record for the party against

whom litigation costs are recoverable is liable to the prevailing

party, jointly and severally, for the amount of the litigation

costs awarded.

(c)AAThe determination of whether an attorney has a financial

interest in a civil action is a question of law for the court. An

attorney is not an attorney of record for the purposes of this

section if the attorney withdraws as attorney of record and

relinquishes any financial interest in the civil action more than

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60 days before trial.

(d)AAThe determination of whether a civil action is an

abusive civil action is a question of fact. In a case in which the

determination of whether a civil action is an abusive civil action

is submitted to a jury, the charge to the jury must ask whether the

civil action prosecuted by the claimant was an abusive civil

action. The following instruction must be included in the

charge:AA"You are instructed that an abusive civil action is a

civil action that a reasonable person would conclude is an abuse of

the civil justice process."

Sec.A38.018.AAAPPLICABILITY OF OTHER LAW. (a) Except as

provided by Subsection (b), if an election is made under this

subchapter, this subchapter controls over any other law to the

extent the other law requires, authorizes, prohibits, or otherwise

governs the award of attorney ’s fees or other costs of litigation in

connection with the civil action.

(b)AAThis subchapter does not govern the recovery of

litigation costs incurred in connection with a claim asserted

under:

(1)AASubchapter E, Chapter 17, Business & Commerce

Code; or

(2)AAChapter 541, Insurance Code.

SECTIONA4.AASection 51.014, Civil Practice and Remedies

Code, is amended by amending Subsections (d) and (e) and adding

Subsections (f) and (g) to read as follows:

(d)AAA person may appeal from an interlocutory order of a

district court, county court at law, or county court that is [may

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issue a written order for interlocutory appeal in a civil action]

not otherwise appealable [under this section] if:

(1)AA[the parties agree that] the order to be appealed

involves a controlling question of law as to which there is a

substantial ground for difference of opinion;

(2)AAan immediate appeal from the order may materially

advance the ultimate termination of the litigation; and

(3)AAthe court of appeals accepts the interlocutory

appeal as provided by Subsection (f) [the parties agree to the

order].

(e)AAAn appeal under Subsection (d) does not stay proceedings

in the trial court unless the parties agree to a stay or [and] the

trial court or appellate court[, the court of appeals, or a judge of

the court of appeals] orders a stay of the proceedings pending

appeal.

(f)AAAn appellate court may, in its discretion, accept an

appeal permitted by Subsection (d) if the appealing party, not

later than the 15th day after the date the trial court signs the

order to be appealed, files in the court of appeals an application

for interlocutory appeal. The application must state the reasons

why an appeal is warranted under Subsection (d). If the court of

appeals accepts the appeal, the appeal is governed by the

procedures set forth in the Texas Rules of Appellate Procedure for

pursuing an accelerated appeal. The date the court of appeals

enters the order accepting the appeal starts the time for filing the

notice of appeal.

(g)AAIf a party pursues an appeal under this section, the

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trial court must state whether the trial court believes that an

appeal is warranted under Subsection (d).

SECTIONA5.AASubtitle B, Title 2, Civil Practice and Remedies

Code, is amended by adding Chapters 29 and 29A to read as follows:

CHAPTER 29. EARLY DISMISSAL OF ACTIONS

Sec.A29.001.AAPOLICY. It is the policy of this state that

all civil actions be disposed of fairly, promptly, and with the

least possible expense to the litigants and to the state.

Sec.A29.002.AAADOPTION OF RULES BY SUPREME COURT. (a) The

supreme court shall adopt rules to provide for the fair and early

dismissal of non-meritorious cases.

(b)AAThe supreme court shall model the rules after Rules 9

and 12, Federal Rules of Civil Procedure, to the extent possible.

(c)AAThe supreme court shall adopt rules under this chapter

not later than December 31, 2011. This subsection expires

September 1, 2012.

CHAPTER 29A. EXPEDITED CIVIL ACTIONS

Sec.A29A.001.AADEFINITIONS. In this chapter:

(1)AA"Claim" means a request, including a counterclaim,

cross-claim, or third-party claim, to recover monetary damages.

(2)AA"Claimant" means a party, including a plaintiff,

counterclaimant, cross-claimant, third-party plaintiff, or

intervenor, seeking recovery of damages and, in an action for

recovery of damages for injury to another person, damage to

property of another person, death of another person, or harm to

another person, includes both the other person and the party

seeking recovery of damages.

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(3)AA"Damages" means all claims under common law or

statutory and equitable causes of action for actual damages,

including economic and noneconomic damages, and additional

damages, including knowing damages, punitive damages, treble

damages, penalties, prejudgment interest, postjudgment interest,

attorney ’s fees, litigation costs, costs of court, and all other

damages of any kind.

(4)AA"Defendant" means a party, including a

counterdefendant, cross-defendant, or third-party defendant, from

whom a claimant seeks damages.

Sec.A29A.002.AAAPPLICABILITY. (a) This chapter applies to

any party who is a claimant or defendant, including:

(1)AAa county;

(2)AAa municipality;

(3)AAa public school district;

(4)AAa public junior college district;

(5)AAa charitable organization;

(6)AAa nonprofit organization;

(7)AAa hospital district;

(8)AAa hospital authority;

(9)AAany other political subdivision of the state; and

(10)AAthe State of Texas.

(b)AAThis chapter does not apply to any civil action

primarily governed by the Family Code.

(c)AAIn an action to which this chapter applies, the

provisions of this chapter prevail over all other law to the extent

of any conflict.

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(d)AAThis chapter does not waive sovereign immunity or

governmental immunity of any claimant or defendant.

Sec.A29A.003.AACLAIMANT TO MAKE ELECTION. (a) This chapter

applies only in a civil action in which:

(1)AAthe total amount of damages the claimant seeks to

recover for all claims is not less than $10,000 and not more than

$100,000; and

(2)AAthe claimant files and serves a written election

under this chapter.

(b)AAAn election must be made at the time the electing

claimant first files a claim in the action.

(c)AANotwithstanding Subsection (b), and on the agreement of

all parties, a claimant may make an election not later than the 60th

day after the date the last defendant has filed an answer.

(d)AAAn election made by a claimant under this section is

binding on all parties to the expedited civil action unless a

defendant files a claim more than 60 days before trial and in that

claim makes a good faith claim that the recovery of monetary damages

might be in excess of $100,000.

Sec.A29A.004.AARULES. (a) The supreme court shall adopt

rules to implement this chapter. The rules shall promote the

prompt, efficient, and cost-effective resolution of an expedited

civil action, including the discovery between the parties.

(b)AAThe supreme court shall adopt rules as required by this

section not later than January 1, 2012. This subsection expires

September 1, 2012.

Sec.A29A.005.AACONFLICT OF LAWS. In the event of a conflict

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between this chapter and Chapter 74, Chapter 74 prevails.

SECTIONA6.AASection 22.225(d), Government Code, is amended

to read as follows:

(d)AAA petition for review is allowed to the supreme court

for an appeal from an interlocutory order described by Section

51.014(a)(3), (6), or (11) or (d), Civil Practice and Remedies

Code.

SECTIONA7.AASubchapter C, Chapter 311, Government Code, is

amended by adding Section 311.035 to read as follows:

Sec.A311.035.AANO IMPLIED CAUSE OF ACTION. A statute may not

be construed to create a cause of action unless a cause of action is

created by clear and unambiguous language in the statute.

SECTIONA8.AASubchapter B, Chapter 312, Government Code, is

amended by adding Section 312.017 to read as follows:

Sec.A312.017.AANO IMPLIED CAUSE OF ACTION. A statute may not

be construed to create a cause of action unless a cause of action is

created by clear and unambiguous language in the statute.

SECTIONA9.AAThis Act applies only to a civil action filed on

or after the effective date of this Act. An action filed before the

effective date of this Act, including an action filed before that

date on which a party is joined or designated after that date, is

governed by the law in effect immediately before the effective date

of this Act, and that law is continued in effect for that purpose.

SECTIONA10.AAIf any provision of this Act or its application

to any person or circumstance is held invalid, the invalidity does

not affect other provisions or applications of this Act that can be

given effect without the invalid provision or application, and to

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this end the provisions of this Act are severable.

SECTIONA11.AAThis Act takes effect September 1, 2011.

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C.S.H.B. 274 82(R) 1

BILL ANALYSIS 

C.S.H.B. 274 

By: Creighton 

Judiciary & Civil Jurisprudence 

Committee Report (Substituted) 

BACKGROUND AND PURPOSE

Interested parties contend that the civil justice system needs to be more efficient, less expensive, 

and more accessible. C.S.H.B. 274 proposes certain reforms to make the civil justice system 

more efficient, less costly, and more accessible by reforming certain procedures in these cases 

and making available certain new procedures. 

RULEMAKING AUTHORITY

It is the committee's opinion that rulemaking authority is expressly granted to the Supreme 

Court of Texas in SECTIONS 1.01 and 2.01 of this bill. 

ANALYSIS

Early Dismissal of Actions 

C.S.H.B. 274 amends the Government Code to require the supreme court to adopt rules to 

provide for the dismissal of certain causes of action that the supreme court determines should 

be disposed of as a matter of law on motion and without evidence. 

C.S.H.B. 274 amends the Civil Practice and Remedies Code to authorize a court, in a civil 

proceeding, on a trial court's granting or denial, in whole or in part, of a motion to dismiss 

filed under the rules adopted by the supreme court Section 22.004(g), Government Code, to 

award costs and reasonable and necessary attorney's fees to the prevailing party that the court 

determines are equitable and just. 

Expedited Civil Actions 

C.S.H.B. 274 amends the Government Code to require the supreme court to adopt rules to 

promote the prompt, efficient, and cost-effective resolution of civil actions in which the 

amount in controversy, inclusive of all claims for damages of any kind, whether actual or 

exemplary, a penalty, attorney's fees, expenses, costs, interest, or any other type of damage of 

any kind, is more than $10,000 but does not exceed $100,000. The bill requires the rules to 

address the need for lowering discovery costs in these actions and the procedure for ensuring 

that these actions will be expedited in the civil justice system. The bill prohibits the supreme 

court from adopting rules that conflict with the Family Code, the Property Code, the Tax Code

or Chapter 74 of the Civil Practice and Remedies Code. 

No Implied Cause of Action 

C.S.H.B. 274 amends the Government Code to prohibit a statute from being construed to 

create a cause of action unless the statute by clear and unambiguous language creates a cause 

of action. 

Appeal of Controlling Question of Law 

C.S.H.B. 274 amends the Civil Practice and Remedies Code to authorize a trial court in a civil action, 

on a party's motion or on its own initiative and by written order, to permit an appeal from an order 

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C.S.H.B. 274 82(R) 2

that is not otherwise appealable if the order involves a controlling question of law as to which there is 

a substantial ground for disagreement, and an immediate appeal may materially advance the 

termination of the litigation. The bill removes the requirement that the parties agree for such an order 

to be subject to immediate appeal. The bill specifies that an appeal does not stay proceedings in the 

trial court unless either the parties agree to a stay or the trial or appellate court orders a stay of the 

proceedings pending appeal. The bill removes language authorizing a judge of the court of appeals to 

order a stay. 

C.S.H.B. 274 authorizes an appellate court to accept such an appeal if the appealing party, not later 

than the 15th day after the date the trial court signs the order to be appealed, files in the court of 

appeals having appellate jurisdiction over the action an application for interlocutory appeal 

explaining why such an appeal is warranted. The bill specifies that if the court of appeals accepts the 

appeal, the appeal is governed by the procedures in the Texas Rules of Appellate Procedure for 

pursuing an accelerated appeal. The bill starts the time applicable to filing the notice of appeal on the 

date the court of appeals enters the order accepting the appeal. 

C.S.H.B. 274 amends the Civil Practice and Remedies Code to require the appealing party to pay 

costs and attorney's fees if the order appealed from is affirmed, amends the Government Code to 

allow a petition for review to the supreme court for an appeal of the order, and specifies that the bill's 

provisions relating to the appeal of controlling questions of law are effective September 1, 2011. 

Recovery of Attorney's Fees 

C.S.H.B. 274 amends the Civil Practice and Remedies Code to establish that the prevailing party, 

rather than only the claimant, may recover reasonable attorney's fees from an individual, corporation, 

or other legal entity if a claim is for breach of an oral or written contract. The bill makes conforming 

changes and specifies that the bill's provisions relating to the recovery of attorney's fees are effective 

September 1, 2011. 

Allocation of Litigation Costs 

C.S.H.B. 274 amends the Civil Practice and Remedies Code to redefine "litigation costs" to include 

reasonable deposition costs and to redefine "settlement offer." The bill specifies that provisions of 

law relating to offers of settlement do not apply to an action filed in a small claims court. The bill 

specifies that an offer to settle or compromise a claim that does not comply with provisions of law 

relating to making a settlement offer does not entitle any party, rather than only the offering party, to 

recover litigation costs. 

C.S.H.B. 274 authorizes a defendant filing a declaration under provisions of law relating to making a 

settlement offer and any party with a claim against that defendant to make a settlement offer to settle 

all claims in the action between the parties. The bill specifies that the parties are not required to file a 

settlement offer with the court. The bill specifies that the litigation costs that may be recovered by the 

offering party are limited to those litigation costs incurred by the offering party after the date the 

rejecting party rejected the earliest settlement offer that entitles the party to an award of litigation 

costs. The bill repeals provisions of law relating to a limitation on recovery of litigation costs and to 

the awarding of litigation costs as an offset. 

C.S.H.B. 274 makes conforming and nonsubstantive changes and specifies that the bill's provisions 

relating to the allocation of litigation costs are effective September 1, 2011. 

C.S.H.B. 274 repeals Sections 42.004(d) and (g), Civil Practice and Remedies Code, effective 

September 1, 2011. 

EFFECTIVE DATE

Except as otherwise provided, on passage, or, if the bill does not receive the necessary vote, 

September 1, 2011. 

COMPARISON OF ORIGINAL TO SUBSTITUTE

C.S.H.B. 274 omits a provision included in the original establishing state policy regarding the early 

dismissal of civil actions. The substitute differs from the original by requiring the supreme court to 

adopt rules to provide for the dismissal of certain causes of action that the supreme court determines 

854
C.S.H.B. 274 82(R) 3

should be disposed of as a matter of law on motion and without evidence, whereas the original 

requires the rules to provide for the fair and early dismissal of non-meritorious cases. The substitute 

omits provisions included in the original requiring the supreme court to model the rules after 

specified Federal Rules of Civil Procedure. The substitute omits a provision included in the original 

relating to a deadline for adopting those rules and setting an expiration date for that provision. 

C.S.H.B. 274 contains a provision not included in the original setting out provisions for the award of 

attorney's fees in relation to certain motions to dismiss. 

C.S.H.B. 274 omits provisions included in the original relating to expedited civil actions, including 

definitions, applicability, and the claimant's option to elect an expedited civil action. The substitute 

differs from the original by requiring the supreme court to adopt rules to promote the prompt, 

efficient, and cost-effective resolution of certain civil actions that address the need for lowering 

discovery costs in those actions and the procedure for ensuring that those actions are expedited, 

whereas the original requires the adopted rules to implement provisions of the bill that promote the 

prompt, efficient, and cost-effective resolution of an expedited civil action, including the discovery 

between parties. The substitute omits a provision included in the original relating to a deadline for 

adopting those rules and setting an expiration date for that provision. The substitute differs from the 

original by prohibiting the supreme court from adopting rules that conflict with the Family Code, the 

Property Code, the Tax Code, or certain provisions of the Civil Practice and Remedies Code, 

whereas the original establishes that certain provisions of the Civil Practice and Remedies Code 

prevail over the rules in the event of a conflict. 

C.S.H.B. 274 retains a provision included in the original that prohibits a statute from being construed 

to create a cause of action absent clear and unambiguous language and omits a provision included in 

the original that duplicates this provision in another general statutory provision. 

C.S.H.B. 274 differs from the original by authorizing a trial court in a civil action, on a party's 

motion or on its own initiative and by written order, to permit an appeal from an order that is not 

otherwise appealable, whereas the original authorizes a person to seek an appeal from an 

interlocutory order of certain courts with the appellate court without first obtaining an order from the 

trial court allowing the appeal. The substitute contains provisions not included in the original 

clarifying that an appeal from an order that is not otherwise appealable is filed with the court of 

appeals having appellate jurisdiction over the action and requiring the appealing party to pay costs 

and attorney's fees if the order is affirmed. The substitute omits a provision included in the original 

requiring a trial court to state whether the trial court believes an appeal is warranted. 

C.S.H.B. 274 omits a provision included in the original that authorizes a prevailing party with respect 

to a claim, rather than a person, to recover attorney's fees from an individual, corporation, or other 

legal entity, rather than from an individual or corporation in addition to the amount of a valid claim 

and costs, if the claim is for certain specified items. 

C.S.H.B. 274 contains provisions not included in the original amending provisions of the Civil 

Practice and Remedies Code relating to the definitions of terms in general provisions relating to 

settlement. The substitute omits provisions included in the original relating to a defendant's election 

to apply provisions relating to allocation of litigation costs to a civil action in which a claimant has 

asserted a claim against the defendant, including provisions relating to definitions, applicability of 

these provisions, the election, a revocation of an election, dismissal or nonsuit of action, award of 

litigation costs, liability of attorney, and the applicability of other law. 

C.S.H.B. 274 contains provisions not included in the original repealing Sections 42.004(d) and (g), 

Civil Practice and Remedies Code. The substitute omits a severability provision included in the 

original. The substitute contains a provision not included in the original making its provisions 

effective on passage if it receives the necessary vote. The substitute differs from the original in 

nonsubstantive ways reflective of certain bill drafting conventions. 

855
By:AACreighton, Aliseda, Kleinschmidt, H.B.ANo.A274

AAAAAJackson, Sheets, et al.

A BILL TO BE ENTITLED

AN ACT

relating to the reform of certain remedies and procedures in civil

actions and family law matters.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

ARTICLE 1. EARLY DISMISSAL OF ACTIONS

SECTIONA1.01.AASection 22.004, Government Code, is amended

by adding Subsection (g) to read as follows:

(g)AAThe supreme court shall adopt rules to provide for the

dismissal of certain causes of action and defenses that the supreme

court determines should be disposed of as a matter of law on motion

and without evidence. Rules adopted under this subsection do not

apply to an action under the Family Code.

SECTIONA1.02.AAChapter 30, Civil Practice and Remedies Code,

is amended by adding Section 30.021 to read as follows:

Sec.A30.021.AAAWARD OF ATTORNEY ’S FEES IN RELATION TO

CERTAIN MOTIONS TO DISMISS. In a civil proceeding, on a trial

court ’s granting or denial, in whole or in part, of a motion to

dismiss filed under the rules adopted by the supreme court under

Section 22.004(g), Government Code, the court may award costs and

reasonable and necessary attorney ’s fees to the prevailing party

that the court determines are equitable and just. This section does

not apply to an action under the Family Code.

ARTICLE 2. EXPEDITED CIVIL ACTIONS

SECTIONA2.01.AASection 22.004, Government Code, is amended

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by adding Subsection (h) to read as follows:

(h)AAThe supreme court shall adopt rules to promote the

prompt, efficient, and cost-effective resolution of civil actions.

The rules shall apply to civil actions in district courts, county

courts at law, and statutory probate courts in which the amount in

controversy, inclusive of all claims for damages of any kind,

whether actual or exemplary, a penalty, attorney ’s fees, expenses,

costs, interest, or any other type of damage of any kind, does not

exceed $100,000. The rules shall address the need for lowering

discovery costs in these actions and the procedure for ensuring

that these actions will be expedited in the civil justice system.

The supreme court may not adopt rules under this subsection that

conflict with a provision of:

(1)AAChapter 74, Civil Practice and Remedies Code;

(2)AAthe Family Code;

(3)AAthe Property Code; or

(4)AAthe Tax Code.

ARTICLE 3. NO IMPLIED CAUSE OF ACTION

SECTIONA3.01.AASubchapter C, Chapter 311, Government Code,

is amended by adding Section 311.035 to read as follows:

Sec.A311.035.AANO IMPLIED CAUSE OF ACTION. A statute may not

be construed to create a cause of action unless the statute by clear

and unambiguous language creates a cause of action. This section

does not apply to an action under the Family Code.

ARTICLE 4. APPEAL OF CONTROLLING QUESTION OF LAW

SECTIONA4.01.AASection 51.014, Civil Practice and Remedies

Code, is amended by amending Subsections (d) and (e) and adding

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Subsection (f) to read as follows:

(d)AAOn a party ’s motion or on its own initiative, a trial

court in a civil action [A district court, county court at law, or

county court] may, by [issue a] written order, permit an appeal from

an order that is [for interlocutory appeal in a civil action] not

otherwise appealable [under this section] if:

(1)AA[the parties agree that] the order to be appealed

involves a controlling question of law as to which there is a

substantial ground for difference of opinion; and

(2)AAan immediate appeal from the order may materially

advance the ultimate termination of the litigation[; and

[(3)AAthe parties agree to the order].

(e)AAAn appeal under Subsection (d) does not stay proceedings

in the trial court unless:

(1)AAthe parties agree to a stay; or

(2)AA[and] the trial or appellate court[, the court of

appeals, or a judge of the court of appeals] orders a stay of the

proceedings pending appeal.

(f)AAAn appellate court may accept an appeal permitted by

Subsection (d) if the appealing party, not later than the 15th day

after the date the trial court signs the order to be appealed, files

in the court of appeals having appellate jurisdiction over the

action an application for interlocutory appeal explaining why an

appeal is warranted under Subsection (d). If the court of appeals

accepts the appeal, the appeal is governed by the procedures in the

Texas Rules of Appellate Procedure for pursuing an accelerated

appeal. The date the court of appeals enters the order accepting

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the appeal starts the time applicable to filing the notice of

appeal.

SECTIONA4.02.AASection 22.225(d), Government Code, is

amended to read as follows:

(d)AAA petition for review is allowed to the supreme court

for an appeal from an interlocutory order described by Section

51.014(a)(3), (6), or (11), or (d), Civil Practice and Remedies

Code.

ARTICLE 5. RECOVERY OF ATTORNEY ’S FEES

SECTIONA5.01.AASection 38.001, Civil Practice and Remedies

Code, is amended to read as follows:

Sec.A38.001.AARECOVERY OF ATTORNEY ’S FEES. A person may

recover reasonable attorney ’s fees from an individual or

corporation, in addition to the amount of a valid claim and costs,

if the claim is for:

(1)AArendered services;

(2)AAperformed labor;

(3)AAfurnished material;

(4)AAfreight or express overcharges;

(5)AAlost or damaged freight or express;

(6)AAkilled or injured stock;

(7)AAa sworn account; or

(8)AAan appeal to the court under Section 11.43, Tax

Code, or an appeal to the court of a determination of an appraisal

review board on a motion filed under Section 11.45, Tax Code [an

oral or written contract].

SECTIONA5.02.AAChapter 38, Civil Practice and Remedies Code,

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is amended by adding Section 38.0015 to read as follows:

Sec.A38.0015.AAORAL AND WRITTEN CONTRACTS. Unless otherwise

provided in a written contract, the prevailing party may recover

reasonable attorney ’s fees from an individual, corporation, or

other legal entity if the claim is for breach of an oral or written

contract.

SECTIONA5.03.AASection 38.002, Civil Practice and Remedies

Code, is amended to read as follows:

Sec.A38.002.AAPROCEDURE FOR RECOVERY OF ATTORNEY ’S FEES. To

recover attorney ’s fees under this chapter:

(1)AAthe person seeking to recover attorney ’s fees

[claimant] must be represented by an attorney;

(2)AAthe claimant must present the claim to the

opposing party or to a duly authorized agent of the opposing party;

and

(3)AApayment for the just amount owed, if any, must not

have been tendered before the expiration of the 30th day after the

claim is presented.

ARTICLE 6. ALLOCATION OF LITIGATION COSTS

SECTIONA6.01.AASections 42.001(5) and (6), Civil Practice

and Remedies Code, are amended to read as follows:

(5)AA"Litigation costs" means money actually spent and

obligations actually incurred that are directly related to the

action [case] in which a settlement offer is made. The term

includes:

(A)AAcourt costs;

(B)AAreasonable deposition costs;

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(C)AAreasonable fees for not more than two

testifying expert witnesses; and

(D)A[(C)]AAreasonable attorney ’s fees.

(6)AA"Settlement offer" means an offer to settle or

compromise a claim made in compliance with Section 42.003 [this

chapter].

SECTIONA6.02.AASections 42.002(b), (d), and (e), Civil

Practice and Remedies Code, are amended to read as follows:

(b)AAThis chapter does not apply to:

(1)AAa class action;

(2)AAa shareholder ’s derivative action;

(3)AAan action by or against a governmental unit;

(4)AAan action brought under the Family Code;

(5)AAan action to collect workers ’ compensation

benefits under Subtitle A, Title 5, Labor Code; or

(6)AAan action filed in a justice of the peace court or

a small claims court.

(d)AAThis chapter does not limit or affect the ability of any

person to:

(1)AAmake an offer to settle or compromise a claim that

does not comply with Section 42.003 [this chapter]; or

(2)AAoffer to settle or compromise a claim in an action

to which this chapter does not apply.

(e)AAAn offer to settle or compromise that does not comply

with Section 42.003 [is not made under this chapter] or an offer to

settle or compromise made in an action to which this chapter does

not apply does not entitle any [the offering] party to recover

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litigation costs under this chapter.

SECTIONA6.03.AASection 42.003, Civil Practice and Remedies

Code, is amended to read as follows:

Sec.A42.003.AAMAKING SETTLEMENT OFFER. (a) After a

defendant files a declaration under Section 42.002(c), the

defendant filing the declaration and any party with a claim against

that defendant may make a settlement offer to settle all claims in

the action between the parties.

(b)AAA settlement offer must:

(1)AAbe in writing;

(2)AAstate that it is made under this chapter;

(3)AAstate the terms by which the claims may be settled;

(4)AAstate a deadline by which the settlement offer

must be accepted; and

(5)AAbe served on all parties to whom the settlement

offer is made.

(c)AAThe parties are not required to file a settlement offer

with the court.

SECTIONA6.04.AASection 42.004(c), Civil Practice and

Remedies Code, is amended to read as follows:

(c)AAThe litigation costs that may be recovered by the

offering party under this section are limited to those litigation

costs incurred by the offering party after the date the rejecting

party rejected the earliest settlement offer that entitles the

party to an award of litigation costs under this section.

SECTIONA6.05.AASections 42.004(d) and (g), Civil Practice

and Remedies Code, are repealed.

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ARTICLE 7. DESIGNATION OF RESPONSIBLE THIRD PARTIES

SECTIONA7.01.AASection 33.004(e), Civil Practice and

Remedies Code, is repealed.

ARTICLE 8. FAMILY LAW MATTERS

SECTIONA8.01.AATitle 6, Civil Practice and Remedies Code, is

amended by adding Chapter 148 to read as follows:

CHAPTER 148. APPLICATION OF FOREIGN LAWS; SELECTION OF FOREIGN

FORUM

Sec.A148.001.AADEFINITION. In this chapter, "foreign law"

means a law, rule, or legal code of a jurisdiction outside of the

states and territories of the United States.

Sec.A148.002.AADECISION BASED ON FOREIGN LAW. A ruling or

decision of a court, arbitrator, or administrative adjudicator on a

matter arising under the Family Code may not be based on a foreign

law if the application of that law would violate a right guaranteed

by the United States Constitution or the constitution or a statute

of this state.

Sec.A148.003.AACHOICE OF FOREIGN LAW OR FORUM IN CONTRACT.

(a) A contract provision providing that a foreign law is to govern

a dispute arising under the Family Code is void to the extent that

the application of the foreign law to the dispute would violate a

right guaranteed by the United States Constitution or the

constitution of this state.

(b)AAA contract provision providing that the forum to resolve

a dispute arising under the Family Code is located outside the

states and territories of the United States is void if the foreign

law that would be applied to the dispute in that forum would, as

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applied, violate a right guaranteed by the United States

Constitution or the constitution of this state.

SECTIONA8.02.AA(a) Section 148.002, Civil Practice and

Remedies Code, as added by this Act, applies only to a ruling or

decision that becomes final on or after the effective date of this

Act. A ruling or decision that becomes final before the effective

date of this Act and any appeal of that ruling or decision are

governed by the law in effect immediately before the effective date

of this Act, and that law is continued in effect for that purpose.

(b)AASection 148.003, Civil Practice and Remedies Code, as

added by this Act, applies only to a contract entered into on or

after the effective date of this Act. A contract entered into

before the effective date of this Act is governed by the law in

effect immediately before that date, and that law is continued in

effect for that purpose.

SECTIONA8.03.AAThis Act takes effect September 1, 2011.

ARTICLE 9. CONTESTED TAX APPRAISAL COSTS

SECTIONA9.01.AAIn an action contesting a tax appraisal a

taxpayer who prevails is entitled to an award of costs and

attorney ’s fees. If the appraisal district or taxing authority

prevails the appraisal district or taxing authority is not entitled

to costs and attorney ’s fees.

ARTICLE 10. EFFECTIVE DATE

SECTIONA10.01.AAThe changes in law made by this Act apply

only to a civil action commenced on or after the effective date of

the change in law as provided by this article. A civil action

commenced before the effective date of the change in law as provided

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by this article is governed by the law in effect immediately before

the effective date of the change in law, and that law is continued

in effect for that purpose.

SECTIONA10.02.AA(a) Except as provided by Subsection (b) of

this section:

(1)AAthis Act takes effect immediately if it receives a

vote of two-thirds of all the members elected to each house, as

provided by Section 39, Article III, Texas Constitution; and

(2)AAif this Act does not receive the vote necessary for

immediate effect, this Act takes effect September 1, 2011.

(b)AAArticles 4, 5, 6, and 7 of this Act take effect September

1, 2011.

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H.B.ANo.A274

AN ACT

relating to the reform of certain remedies and procedures in civil

actions and family law matters.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

ARTICLE 1. EARLY DISMISSAL OF ACTIONS

SECTIONA1.01.AASection 22.004, Government Code, is amended

by adding Subsection (g) to read as follows:

(g)AAThe supreme court shall adopt rules to provide for the

dismissal of causes of action that have no basis in law or fact on

motion and without evidence. The rules shall provide that the

motion to dismiss shall be granted or denied within 45 days of the

filing of the motion to dismiss. The rules shall not apply to

actions under the Family Code.

SECTIONA1.02.AAChapter 30, Civil Practice and Remedies Code,

is amended by adding Section 30.021 to read as follows:

Sec.A30.021.AAAWARD OF ATTORNEY ’S FEES IN RELATION TO

CERTAIN MOTIONS TO DISMISS. In a civil proceeding, on a trial

court ’s granting or denial, in whole or in part, of a motion to

dismiss filed under the rules adopted by the supreme court under

Section 22.004(g), Government Code, the court shall award costs and

reasonable and necessary attorney ’s fees to the prevailing party.

This section does not apply to actions by or against the state,

other governmental entities, or public officials acting in their

official capacity or under color of law.

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ARTICLE 2. EXPEDITED CIVIL ACTIONS

SECTIONA2.01.AASection 22.004, Government Code, is amended

by adding Subsection (h) to read as follows:

(h)AAThe supreme court shall adopt rules to promote the

prompt, efficient, and cost-effective resolution of civil actions.

The rules shall apply to civil actions in district courts, county

courts at law, and statutory probate courts in which the amount in

controversy, inclusive of all claims for damages of any kind,

whether actual or exemplary, a penalty, attorney ’s fees, expenses,

costs, interest, or any other type of damage of any kind, does not

exceed $100,000. The rules shall address the need for lowering

discovery costs in these actions and the procedure for ensuring

that these actions will be expedited in the civil justice system.

The supreme court may not adopt rules under this subsection that

conflict with a provision of:

(1)AAChapter 74, Civil Practice and Remedies Code;

(2)AAthe Family Code;

(3)AAthe Property Code; or

(4)AAthe Tax Code.

ARTICLE 3. APPEAL OF CONTROLLING QUESTION OF LAW

SECTIONA3.01.AASection 51.014, Civil Practice and Remedies

Code, is amended by amending Subsections (d) and (e) and adding

Subsections (d-1) and (f) to read as follows:

(d)AAOn a party ’s motion or on its own initiative, a trial

court in a civil action [A district court, county court at law, or

county court] may, by [issue a] written order, permit an appeal from

an order that is [for interlocutory appeal in a civil action] not

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otherwise appealable [under this section] if:

(1)AA[the parties agree that] the order to be appealed

involves a controlling question of law as to which there is a

substantial ground for difference of opinion; and

(2)AAan immediate appeal from the order may materially

advance the ultimate termination of the litigation[; and

[(3)AAthe parties agree to the order].

(d-1)AASubsection (d) does not apply to an action brought

under the Family Code.

(e)AAAn appeal under Subsection (d) does not stay proceedings

in the trial court unless:

(1)AAthe parties agree to a stay; or

(2)AA[and] the trial or appellate court[, the court of

appeals, or a judge of the court of appeals] orders a stay of the

proceedings pending appeal.

(f)AAAn appellate court may accept an appeal permitted by

Subsection (d) if the appealing party, not later than the 15th day

after the date the trial court signs the order to be appealed, files

in the court of appeals having appellate jurisdiction over the

action an application for interlocutory appeal explaining why an

appeal is warranted under Subsection (d). If the court of appeals

accepts the appeal, the appeal is governed by the procedures in the

Texas Rules of Appellate Procedure for pursuing an accelerated

appeal. The date the court of appeals enters the order accepting

the appeal starts the time applicable to filing the notice of

appeal.

SECTIONA3.02.AASection 22.225(d), Government Code, is

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amended to read as follows:

(d)AAA petition for review is allowed to the supreme court

for an appeal from an interlocutory order described by Section

51.014(a)(3), (6), or (11), or (d), Civil Practice and Remedies

Code.

ARTICLE 4. ALLOCATION OF LITIGATION COSTS

SECTIONA4.01.AASections 42.001(5) and (6), Civil Practice

and Remedies Code, are amended to read as follows:

(5)AA"Litigation costs" means money actually spent and

obligations actually incurred that are directly related to the

action [case] in which a settlement offer is made. The term

includes:

(A)AAcourt costs;

(B)AAreasonable deposition costs;

(C)AAreasonable fees for not more than two

testifying expert witnesses; and

(D)A[(C)]AAreasonable attorney ’s fees.

(6)AA"Settlement offer" means an offer to settle or

compromise a claim made in compliance with Section 42.003 [this

chapter].

SECTIONA4.02.AASections 42.002(b), (d), and (e), Civil

Practice and Remedies Code, are amended to read as follows:

(b)AAThis chapter does not apply to:

(1)AAa class action;

(2)AAa shareholder ’s derivative action;

(3)AAan action by or against a governmental unit;

(4)AAan action brought under the Family Code;

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(5)AAan action to collect workers ’ compensation

benefits under Subtitle A, Title 5, Labor Code; or

(6)AAan action filed in a justice of the peace court or

a small claims court.

(d)AAThis chapter does not limit or affect the ability of any

person to:

(1)AAmake an offer to settle or compromise a claim that

does not comply with Section 42.003 [this chapter]; or

(2)AAoffer to settle or compromise a claim in an action

to which this chapter does not apply.

(e)AAAn offer to settle or compromise that does not comply

with Section 42.003 [is not made under this chapter] or an offer to

settle or compromise made in an action to which this chapter does

not apply does not entitle any [the offering] party to recover

litigation costs under this chapter.

SECTIONA4.03.AASection 42.003, Civil Practice and Remedies

Code, is amended to read as follows:

Sec.A42.003.AAMAKING SETTLEMENT OFFER. (a)AAA settlement

offer must:

(1)AAbe in writing;

(2)AAstate that it is made under this chapter;

(3)AAstate the terms by which the claims may be settled;

(4)AAstate a deadline by which the settlement offer

must be accepted; and

(5)AAbe served on all parties to whom the settlement

offer is made.

(b)AAThe parties are not required to file a settlement offer

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with the court.

SECTIONA4.04.AASection 42.004(d), Civil Practice and

Remedies Code, is amended to read as follows:

(d)AAThe litigation costs that may be awarded under this

chapter to any party may not be greater than the total amount that

the claimant recovers or would recover before adding an award of

litigation costs under this chapter in favor of the claimant or

subtracting as an offset an award of litigation costs under this

chapter in favor of the defendant [an amount computed by:

[(1)AAdetermining the sum of:

[(A)AA50 percent of the economic damages to be

awarded to the claimant in the judgment;

[(B)AA100 percent of the noneconomic damages to be

awarded to the claimant in the judgment; and

[(C)AA100 percent of the exemplary or additional

damages to be awarded to the claimant in the judgment; and

[(2)AAsubtracting from the amount determined under

Subdivision (1) the amount of any statutory or contractual liens in

connection with the occurrences or incidents giving rise to the

claim].

ARTICLE 5. DESIGNATION OF RESPONSIBLE THIRD PARTIES

SECTIONA5.01.AASection 33.004, Civil Practice and Remedies

Code, is amended by adding Subsection (d) to read as follows:

(d)AAA defendant may not designate a person as a responsible

third party with respect to a claimant ’s cause of action after the

applicable limitations period on the cause of action has expired

with respect to the responsible third party if the defendant has

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failed to comply with its obligations, if any, to timely disclose

that the person may be designated as a responsible third party under

the Texas Rules of Civil Procedure.

SECTIONA5.02.AASection 33.004(e), Civil Practice and

Remedies Code, is repealed.

ARTICLE 6. EFFECTIVE DATE

SECTIONA6.01.AAThe changes in law made by this Act apply only

to a civil action commenced on or after the effective date of the

change in law as provided by this article. A civil action commenced

before the effective date of the change in law as provided by this

article is governed by the law in effect immediately before the

effective date of the change in law, and that law is continued in

effect for that purpose.

SECTIONA6.02.AAThis Act takes effect September 1, 2011.

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______________________________ ______________________________

AAAAPresident of the Senate Speaker of the HouseAAAAAA

I certify that H.B. No. 274 was passed by the House on May 9,

2011, by the following vote:AAYeas 96, Nays 49, 3 present, not

voting; and that the House concurred in Senate amendments to H.B.

No. 274 on MayA25, 2011, by the following vote:AAYeasA130, NaysA13,

2Apresent, not voting.

______________________________

Chief Clerk of the HouseAAA

I certify that H.B. No. 274 was passed by the Senate, with

amendments, on MayA24, 2011, by the following vote:AAYeasA31,

NaysA0.

______________________________

Secretary of the SenateAAA

APPROVED: __________________

AAAAAAAAAAAAAAAAADateAAAAAAA

AAAAAAAAA __________________

AAAAAAAAAAAAAAAGovernorAAAAAAA

H.B.ANo.A274

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Texas Legislature Online

History

Bill: HB 274 Legislative Session: 82(R) Council Document: 82R 13370 CAE-F

Last Action: 05/30/2011 E Effective on 9/1/11

Caption Version: Enrolled

Caption Text: Relating to the reform of certain remedies and procedures in civil actions and family law

matters.

Author: Creighton | Aliseda | Kleinschmidt | Jackson, Jim | Sheets

Coauthor: Anderson, Charles "Doc" | Anderson, Rodney | Aycock | Beck | Berman | Bohac | Bonnen |

Branch | Brown | Burkett | Button | Cain | Callegari | Carter | Chisum | Christian | Cook |

Crownover | Darby | Davis, John | Davis, Sarah | Driver | Eissler | Elkins | Fletcher | Flynn |

Frullo | Garza | Gonzales, Larry | Gooden | Hamilton | Hancock | Hardcastle | Harless |

Harper-Brown | Hilderbran | Hopson | Howard, Charlie | Huberty | Isaac | Keffer | King, Phil

| King, Susan | Kolkhorst | Kuempel | Landtroop | Larson | Laubenberg | Lavender | Legler

| Lyne | Madden | Margo | Miller, Doug | Miller, Sid | Morrison | Murphy | Nash | Orr | Otto |

Parker | Patrick, Diane | Paxton | Pena | Perry | Pitts | Price | Schwertner | Scott | Shelton |

Simpson | Smith, Todd | Smith, Wayne | Taylor, Larry | Taylor, Van | Torres | Truitt | Weber

| White | Woolley | Workman | Zedler | Zerwas

Sponsor: Huffman

Subjects: Civil Remedies & Liabilities (I0065)

Courts--Civil Procedure (I0135)

Tort Reform (I0816)

ATTORNEY'S FEES (S0202)

SUPREME COURT (V0311)

House Committee: Judiciary & Civil Jurisprudence Bill Subcommittee: Torts

Status: Out of committee Madden (Chair) | Davis, Sarah | Lewis

Vote: Ayes=7 Nays=1 Present Not Voting=0 Absent=3

Senate Committee: State Affairs

Status: Out of committee

Vote: Ayes=9 Nays=0 Present Not Voting=0 Absent=0

Actions: (descending date order)

Viewing Votes: Most Recent House Vote | Most Recent Senate Vote

Description Comment Date Time

 

Journal

Page

E Effective on 9/1/11 05/30/2011 

E Signed by the Governor 05/30/2011 6917

E Sent to the Governor 05/27/2011 6459

S Signed in the Senate 05/27/2011 4373

H Signed in the House 05/27/2011 6275

H Reported enrolled 05/27/2011 07:45

AM 

874 6459
S House concurs in Senate amendment(s)-

reported 

 05/25/2011 3715

H Text of Senate Amendment(s) 05/25/2011 5704

H Statement(s) of vote recorded in Journal 05/25/2011 5704

H Record vote RV#1504 05/25/2011 5704

H House concurs in Senate amendment(s) 05/25/2011 5704

H Senate Amendments Analysis distributed 05/24/2011 06:44

PM 

H Senate Amendments distributed 05/24/2011 06:43

PM 

H Senate passage as amended reported 05/24/2011 5390

S Record vote 05/24/2011 3373

S Passed 05/24/2011 3373

S Read 3rd time 05/24/2011 3373

S Record vote 05/24/2011 3373

S Three day rule suspended 05/24/2011 3373

S Vote recorded in Journal 05/24/2011 3373

S Read 2nd time & passed to 3rd reading 05/24/2011 3373

S Record vote 05/24/2011 3373

S Rules suspended-Regular order of business 05/24/2011 3373

S Placed on intent calendar 05/24/2011 

S Committee report printed and distributed 05/23/2011 11:14

AM 

S Reported favorably as substituted 05/23/2011 3319

S Testimony taken in committee 05/21/2011 

S Considered in public hearing 05/21/2011 

S Left pending in committee 05/16/2011 

S Testimony taken in committee 05/16/2011 

S Considered in public hearing 05/16/2011 

S Scheduled for public hearing on . . . 05/16/2011 

S Referred to State Affairs 05/10/2011 2188

S Read first time 05/10/2011 2188

S Received from the House 05/10/2011 2156

H Reported engrossed 05/10/2011 07:50

AM 3652

H Reason for vote recorded in Journal 05/09/2011 3221

H Statement(s) of vote recorded in Journal 05/09/2011 3221

H Record vote RV#857 05/09/2011 3220

H Passed as amended 05/09/2011 3220

H Record vote RV#856 05/09/2011 3220

H Amendment tabled 11-Dutton 05/09/2011 3220

H Record vote RV#855 05/09/2011 3219

H Amendment tabled 10-Dutton 05/09/2011 3219

H Record vote RV#854 05/09/2011 3218

H Amendment tabled 9-Dutton 05/09/2011 3218

H Amended 4-Lucio 05/09/2011 3218

H Vote reconsidered 05/09/2011 3218

H Statement(s) of vote recorded in Journal 05/09/2011 3217

H Record vote RV#853 05/09/2011 3217

H Amendment adopted as amended 7-Gutierrez 05/09/2011 3217

H Record vote RV#852 05/09/2011 3216 875
H Motion to table fails 7-Gutierrez 05/09/2011 3216

H Amendment amended 8-Gutierrez 05/09/2011 3216

H Amendment(s) offered 7-Gutierrez 05/09/2011 3216

H Statement(s) of vote recorded in Journal 05/09/2011 3215

H Record vote RV#851 05/09/2011 3215

H Amended 6-Hilderbran 05/09/2011 3214

H Statement(s) of vote recorded in Journal 05/09/2011 3214

H Record vote RV#850 05/09/2011 3213

H Amended 5-Lewis 05/09/2011 3213

H Statement(s) of vote recorded in Journal 05/09/2011 3213

H Record vote RV#849 05/09/2011 3212

H Amendment tabled 4-Lucio 05/09/2011 3212

H Amendment withdrawn 3-Eiland 05/09/2011 3212

H Amendment adopted as amended 1-Creighton 05/09/2011 3211

H Statement of Leg. Intent Recorded in Journal 05/09/2011 3209

H Amendment amended 2-Creighton 05/09/2011 3209

H Amendment(s) offered 1-Creighton 05/09/2011 3209

H Statement of Leg. Intent Recorded in Journal 05/09/2011 3206

H Read 3rd time 05/09/2011 3206

H Statement(s) of vote recorded in Journal 05/07/2011 3200

H Record vote RV#847 05/07/2011 3200

H Passed to engrossment 05/07/2011 3200

H Statement(s) of vote recorded in Journal 05/07/2011 3199

H Record vote RV#846 05/07/2011 3199

H Motion prevails 05/07/2011 3199

H Motion for the previous question 05/07/2011 3199

H Statement(s) of vote recorded in Journal 05/07/2011 3198

H Record vote RV#844 05/07/2011 3197

H Motion to suspend rules 05/07/2011 3197

H Point of order overruled Rule 6, Section 6 and Rule 13,

Section 1 05/07/2011 3197

H Read 2nd time 05/07/2011 3197

H Placed on Emergency Calendar 05/07/2011 

H Considered in Calendars 05/06/2011 

H Committee report sent to Calendars 05/05/2011 

H Committee report distributed 05/05/2011 11:09

PM 

H Comte report filed with Committee Coordinator 05/05/2011 3178

H Reported favorably as substituted 05/05/2011 

H Committee substitute considered in committee 05/05/2011 

H Considered in formal meeting 05/05/2011 

H Returned to committee 05/05/2011 3073

H Point of order sustained Rule 4, Section 32(b)(9) 05/05/2011 3073

H Point of order overruled Rule 4, Section 32(b) 05/05/2011 3073

H Read 2nd time 05/05/2011 3073

H Placed on Major State Calendar 05/05/2011 

H Considered in Calendars 05/02/2011 

H Committee report sent to Calendars 04/27/2011 

H Committee report distributed 04/26/2011 05:38

PM 

H Comte report filed with Committee Coordinator 04/26/2011 2324

876
H Reported favorably as substituted 04/14/2011 

H Committee substitute considered in committee 04/14/2011 

H Recalled from subcommittee 04/14/2011 

H Considered in formal meeting 04/14/2011 

H Subcommittee members named 04/11/2011 

H Referred to subcommittee 04/11/2011 

H Committee substitute considered in committee 04/11/2011 

H Recalled from subcommittee 04/11/2011 

H Considered in public hearing 04/11/2011 

H Scheduled for public hearing on . . . 04/11/2011 

H Left pending in subcommittee 04/06/2011 

H Testimony taken/registration(s) recorded in

subcommittee 04/06/2011 

H Considered by s/c in public hearing 04/06/2011 

H Scheduled for public hearing in s/c on . . . 04/06/2011 

H Posting rule suspended 04/05/2011 1488

H Subcommittee members named 04/04/2011 

H Referred directly to subcommittee by chair 04/04/2011 

H Referred to Judiciary & Civil Jurisprudence 03/14/2011 777

H Read first time 03/14/2011 777

H Filed 03/10/2011 

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