### TEXAS COURT OF APPEALS, THIRD DISTRICT, AT AUSTIN

NO. 03
- 22
- 00084
- CV

Anthony V. Udenze and Fidel A. Udenze d/b/a AB ’ s Like New Auto Sales , Appellant s

v. Monique Johnston, Director, Motor Vehicle Division Texas DMV , Appellee

DIRECT APPEAL FROM THE TEXAS DEPARTMENT OF MOTOR VEHICLES MOTOR VEHICLE DIVIS ION DOCKET NO. 20
- 0013690.ENF , MVD CASE NO. 22
- 0001664

M E M O R A N D U M O P I N I O N
This is a direct appeal from a final order of the Moto r Vehicle Division of the Texas Department of Motor Vehicles (DMV)

. See Tex. Occ. Code § 2301.751

. Anthony V. Udenze and Fid el A. Udenze 1 d/b/a AB ’ s Like New Auto Sales request that we reverse the
DMV ’ s orde r re voking their vehicle

- de aler license and assessing a civil penal ty as sanctions for
their alleg e d violations of certain applicable laws and regulations

. The Udenzes argue th a t the DMV denied them due process by not construing their communications attempting to n egotiate a
lesser sanction as a request for an administrative hea ring

. The DMV responds that the Udenzes
had been fully and properly informed of their right to request a hearing and the consequences of
a f ailure to do so , that substantial evidence supports the DMV ’ s finding that the Udenzes did not timely request a hearing , that the alleged v iolation s were thus properly dee m ed admitted , and tha t

1 Because appellant s share the same last na me, w e use their first names w he n neces sary to refer to the m indiv idual ly but o therwise r efer to them collectively as appe llants or the Udenzes.2

the Udenzes did not raise any grounds adequate to support rehearing. As e xplained below, we will affirm the DMV ’ s order.

BACK GROUND

The Udenzes operate a used

- car dealershi p pursuant to a General D i stinguis h ing Number (GDN) license issued by the DMV. Se e id. § 2301.255 ; Tex. T ransp. Code § 503.021

. On October 11, 2021, the DMV sent the Udenze s a letter enclosing a Notice of Department Decision (NODD) , informing them that the DMV had inve stigated th eir business and determined
that they had vio lated enumerated applic able law s through the following allege d act s or omissions : mis use of a buyer ’ s tag ; failure to comply with the requirements for issuance or recordkeeping of a buyer ’ s tag ; failu re to ke ep a complete record of all vehicles pur chase d o r sold ; failure to remit motor vehicle sales ta x ; failure t o apply for the registration and title for car
sales ; and failure to meet premises requirements to operate as a dea ler pertainin g to required
si gn age, p arking spots, and posting of business hours

. The letter stated,
If there are circumstances surrounding the allegations that you believe should mitigate any sanction imposed by the Dec i sion you can discus s an informal settlement wi th th e unders ign ed enfor cement attorney. To discuss an infor ma l settlement of the case you must first request an administrative hearing as explained in the Decision within twenty

- six (26) days from the date o f the Decision. For your conven ience , you may use the re qu est for hea ring form included in this packe t

. In most instances, an informal sett lem ent can resolve the case in a shorter period of time with reduced civil penalties or other sanctions and without the costs associated with a formal proceeding. The unders i gne d attorn ey can be contacted at [number omitte d] or by writing using the address above.

. . . If you do not request an administrative hearing with in twenty
- s ix (26) days from the date of the De c ision, the terms and any sanctions contained t herei n become fi na l.3 The enclosed NODD stated that the DMV recommend ed the assessment of a civil penalty of $8,000 and that the Udenzes ’ GDN license be revoked. The NODD informed the Udenzes of their right t o request a hearing and the procedures theref or:

I f you wi sh to conte st the allegations, recommended civil p e nalty, or other sanction you must first request a n administrative hearing in writing. You may send your own request for hearing or use the Reques t for Administrative Hearing form included in this packet. Se nd your request to the following address:

. . . The Department must receive your written hearing r equest not later than the 2 6 th day after the date of this Decision. If you timely submitted a written request for a hearing, the Department may enter in to an infor ma l settlement agreement with you reg arding these violations and enforcement action at any time bef ore a final d ecision is rendered in this case.

. . . If you do not request a hearing b y the 2 6 th day from the date of this notice, t he De partment De cision b ecomes final. After that date the De pa rtment may issue a Final Order imple me nting the Decision.

At tached to the NODD was a form entitled “ R e quest for Administrative Hearing

. ” The first paragraph of that form read , “ I f you intend t o con test the al legation s listed in the [NODD] in this
matter or negotiate a settlement with the assigned enforcement di vision attorney you must first request an a dministrative hearing. You may use this form t o request a hearing. ” The form
included a box to c heck (ei the r yes or no) for whether the person requestin g the hearing would

“ like to discuss a resolution of this case without a hearing

. ” At the bottom of the form was printed the following in bold , ital i cized font: “ This request for hearing must be rece ived at the below a ddress no later than 2 6 days from the date of the Notice of Department Decision. ”4 Attached to the hearing

- request form w ere several pages entitled “ Information about the N o tice of Department Decision. ” Within these pages the mand ate t o timely re quest a hearing was again reiterated: “ You ma y settle this matter infor mally and avoid a hearing before an Administrative Law Judge ( “ ALJ ” ) a t the S t ate Office of Administrative Hearings ( “ SOAH ” ) by timely filing a request for hearing with i n 26 days of th e date of the Decision and d iscussin g the case w ith the enforcement attorney. ” The due date, therefore, to request an administrat iv e hearing was November 6, 2021.

On No vember 24, 2021, the DMV ’ s Direc tor signed a f inal order find ing that t he Udenz e s “ fai led to s ubmit in writing a request for hearing or to enter into a settlement agreement
before the 2 7 th day after the date of the Departm ent ’ s Decision ” and concluding t hat such failure

“ deems the findings and administrative sanctio n cited i n the Dec is ion a s final in accordance with 43 Tex. Admin. Code § 215 .500(g)

. ” The order notified the Ud enzes that their G DN license was

re voked , that t hey must cease and desist from operating as a motor

- vehicle dealer until t hey secure a new license f

rom t he DMV, th at re vocation of their license may result in denial of a subsequent license application, and that they must pay a civil pena lty of $8,000 within thirty days. The cover letter enclosing the final order and sent to t he Udenzes notified th em t hat i f th ey

“ di sagre e [d] wit h the final order, ” they were entitled to file a motion for r ehearing within t wenty

five days. The letter specified the pr ocess for fi ling a motion for rehe aring and stated tha t the
motio n must (1) includ e the specific reasons , exce ptions, or grou nds asse rted by a party as the
b asis of the request for rehearing ; and (2) recite the specific finding of fact, con clusion of law, or any other portion of the final order to which the party objects.

On Decem ber 15, 2021, Anthony f iled with the D MV a moti on for r ehearing in which he explained that he had sent several emails to the DMV attorney assigned to this cas e ,5

Jenn a fer Tallant, and that Tallant had called him back and informed him that he should “ get back
to her afte r cha nging our business a ddress ” b ut did “ not mention any date for my response or compliance to the issues o n this case. ” He further explained in th e motion s ome of the Covid

- 19

- pan demic

- related difficulties he and his business had experienced and pl eaded t hat the DMV

“ grant my a ppeal so that [ Ta llant ] and I could negotiate this case amicably or extend me time to
secure a la wyer for appropriate legal re pres entation. ” In the n ext section of his motion, Anthony
respon d ed directly to each of the eigh t alleged substant ive v io lation s noticed i n the NO DD . He attached several “ evidentiary documents ” and pleaded for “ another chan ce . ” H is motion was not verified or accompanied by an affidavit averring to t he truth of the matters he had asserted or to the authenticity of th e at t ached do cu ments.

One of t he documents attached to Anthony ’ s m otion for rehearing was a print

- out of an October 20, 2021 email he sent to Talla nt , stating th at he was in receipt of the NODD and
ask ing Tallant to please call him “ so that we can dis cus s th i s case , ” e xplaining that he and his
business had suffered and had “ not fully recov ered ” from the Covid

- 19 pa ndemic. Wi thin the email Anthony referenced Aug ust 2020 communications from a “ Ms. Blackwell ” with the DMV , during the “ hi gh p[eak] ” of the pa nd em i c , and A nt hony ’ s se n ding to Ms. Blackwell “ some ” of
the inf ormation she had requested. Ant hony ended his Oc tober 20 email thusly: “ I will really need your help in resolving this mat ter with [a] warning. If a nd when you ca ll me back, I will
l ike to g iv e y ou my re sp onse for each of this [s ic ] charges. ” Anthony attached to his motion for

r ehearing a print

- out of ano ther email he sent Tallant on October 27, “ since [ he had] not heard
from ” her. H e in dicated that he was “ waiting for [Tallant ’ s ] communic a ti on so that we can disc uss this case fairly in other [sic ] to give me clarity to understand my ne xt course of action

. ”6 Anthony additionally attached to his motion for r ehearing a print

- out of an email
tha t Tall ant sent him on October 28, 20 21, b ut that An th o ny app ea rs to have received and p rinted
out on December 17, 20 21 (as indicated by the p age ’ s header) . The print

- out contains the following handwritten notation ( purportedly made by Anthony ) : “ I never received thi s email till yesterday [December 16, 2 021] in my sp am box this w as sen t after our phone conversation! ” 2 In the Octobe r 28 email, Tallant informed Anthony that a “ warning is not appropriate for this case ”
but that “ to avoid re vocation and to move forward on settling, [he] need[ ed ] to com e in

c ompl i ance wit h the premi ses viol ations , ” and listed t hree specific actio n items related to the
business premises

. Tallant ’ s email c oncluded, “ [o]nce you have the three things taken care of, e

mail me pic tures of compli ance, and we will go from there. I ’ l l se t a remin de r for a w eek from today. ” The remaining documents attached to Anth ony ’ s motion for r e hearing consisted of photographs of his business premises and other documents purport ing to rebut the DMV ’ s allegation s of the non - premi ses v i olations

.

On J a nuary 1 8, 2022, the D MV sent the Udenzes a letter enclosing a “ Decisio n and Order Denying the Motion for Rehearing , ” stating that the order “ conclu des the appeal process at the administrative agency level ” and inf orming the Udenzes of their right to file a n
appea l in Travis C o unty di strict court or th is Court within thirty days. The Udenzes time ly filed
their direc t appeal in this Court.

2 In their brief, after r ep rinting the text of Tallant ’ s email , the Udenzes represent , “ Unfortunately, [Tallant ’ s] email went into Appellants ’ spam account. See notation [on pr int

- out of emai l ]

. ”7 DISCUSSION In t hree issues, the Udenze s contend that (1) the initial emai l corres pondence they sent the DM V on Octo be r 20, 20 21, should h ave been construed as a request for a n administrative hearing , given that the Departme nt r esponded and “ suggest ed mitigation factors ”
and further discussions ; (2) the default order against them should be vacated because ( a ) the ir
defa ul t was unintentional an d not the result of conscious indifference, ( b ) the y have a meri t orious
defense to the allegations, and ( c ) setting aside the default will not d elay or otherwise injure the
DMV ; and (3) the DMV ’ s actions denied them due process

.

We review the DMV ’ s fi n a l o rder , including the order ’ s f act findings and legal conclusions, under the substantial

- evidence rule. See Tex. Occ. Code § 2301.751(a) ; Tex. Gov ’ t Code § 2001.174(a)( 2) ; Buddy Gregg Motor H o mes, Inc. v. Motor Vehicle Bd. , 156 S .W. 3 d 91, 98

– 99 (Tex. A p p . — Aust i n 2004, pet. denied)

. Under that rule, a r eviewing court presumes the
agency ’ s order is supported by substan tial evidence , see Texas Health F a cilities Comm ’ n v. Charter

- Med.

- Dall ., I

n c. , 665 S.W.2d 446, 452 (Tex. 1984) , and wi l l u phold a decision w here
th e record contains relia ble and probative evidence that reasonably supports the agency ’ s decision, see Graff Chevrolet Co. v. Texas Motor Vehicle Bd. , 60 S.W.3d 154 , 159 (Tex. App.

— Austin 2001, pet. denied)

. Furthermore , whe n

— a s here

— a party ’ s mot i o n for r ehearing is a prerequisite for judic ial review, the motion must “ identify with particularity [the] findings of
fact or conclu sions of law that are the subject of t he complaint and any evidentiary or legal ruling clai med to b e e r roneous. ” Atkins v

. Texas D ep ’ t of Motor V eh icles , No. 03

- 19

- 00964

- CV , 2021 WL 5457223, at * 3 (Tex. App.

— Austin Nov. 18, 2021, n o pet. ) (mem. op.) (citing Tex. Gov ’ t Code § 2001.146(g) ) ; see also Tex. Gov ’ t Code § 2001.145(a) (noting when motion for

r ehe a ring is prerequi sit e to appe al in contested case)

.8 Regarding the Udenze s ’ first is sue, in which they argue that their email
corresp o ndence with the DMV should have been con strued as a req uest for a hearing, we
conclude that t he record contains subs tan tia l evidence to sup po r t the DM V ’ s findings and
conclusion s that the Udenzes did not thereby (or othe rwise) request a hearing . The Udenzes did not use the word “ hearing ” in any of th ei r email corresp ondence, and they point to no e vidence otherwise appe arin g in the record ( in cl u ding the docu ments attached to their motio n for
reheari ng ) of any written h e aring request they made or of a ny reference to a hearing in their correspondence with the DMV

. See Atkins , 2021 WL 5457223, at * 3 ( holding that appe llant ’ s
rep re sentation in hi s m otion fo r rehe aring that he had been communicating with agency staff to try to negotiate case was not suffi cient to rebut agency ’ s finding that he did n ot timely request hearing ). The DMV ’ s NODD and accompanying documents re peate dly an d consistently st at e d
the re quirement for a timely written hearing request to avoid the NODD ’ s becoming fin al and even contained a simple one - page form that the Udenzes cou ld have used to request one

. But the Udenzes did not make a written requ est f or a h earing. Furthermore , in the ir motion for reh earing
the Ude nzes d i d not specif ically challenge any of the DMV ’ s findings or conclusions r elated to their failure to request a hearing. See Tex. Gov ’ t Code § 2001.146(g) ; Atkins , 2021 WL 5457223,

a t * 3 ( basin g affirmance of DMV order in p art on appellant ’ s failure to identi fy in motion for rehearing any finding of fact or conclusion of l aw he was chal lenging).

The fact that Tallant responded to the Udenzes ’ email correspondence with an email ide ntify ing thre e a ctions the Udenze s must t ake to “ come into compliance with the premises violations ” and to “ avoid revocation and to move forward on settling ” does not
transform the Udenzes ’ email correspondence into a hearing request or requi re a finding o r

con clusion that it should have been s o con strued

. Furthe rmore, by Anthony ’ s own admission,9

the Udenzes did not even know about Tallant ’ s email suggesting t he possibility of se ttling the
case until after th e dea dline to request a hearing or settle the ca se ha d passed ; t hus , the Udenzes
cannot r e asonably claim that th ey relied on the DMV ’ s correspondence in failing to timely request a hearing

. Concluding that substantial evidence supports t he DMV ’ s finding that the Udenzes did not tim ely request a hearing , w e overrule the Udenzes ’ first issue.

In their secon d issue, the Uden zes attempt to assert a Craddock defe nse to what

was essential ly a default order re ndered against them , and we acknowledge that this Court has
held the Craddock test may apply t o admi nistr ative pr oceedings in appropr iate ci r c umstances

. See Anderson v. Railroad Comm ’ n , 9 63 S.W.2d 217, 219 (Tex. App.

— Austin 1998, pet. denied ) ( stating, “ w e think the Craddock standard is appropriate to apply to agency denials of rehearings
after a defaul t ord er , ” an d s pecifyin g three ele ments of Craddock t est ) ; see also Craddock v. Sunshine Bus. Lines , 133 S.W.2d 124, 1 26 (Tex. 1939)

.

The f irst element of the Cra ddock test is that the default was unintentional and not
a result of conscious indifferenc e , an d whe n appl ying the test to an agen cy p roceeding, the appellant must support th is allegation with evidence attached to a m otion for rehe aring

. Anderson , 963 S.W.2d at 219 ; see Statewide Convoy Transports, Inc. v. Railroad Co mm ’ n , 753 S.W.2d 800, 805 (Te x. App.

— Austin 1988, no writ ) ( hol din g tha t agency did not abuse discretion in denying motion for rehearing that was not veri fied and where party did not at tempt to adduce evidence before agency to support allegation in motion that it s withdrawal from c ase

w as due to mi s take) ; see also I n re Ma rri age of Sandoval , 619 S.W.3d 716, 721

– 22 (Tex. 2021) ( stating that it is abuse of discretion to deny motion for new trial if uncont r overted fa ctual allegations in supporting affidavit are sufficient under Craddoc k ; th at “ some ex c use, ” including
mi st ake o f l aw, meets first element ; and that court must accept as true uncontrove rted facts10

within affiant ’ s personal knowled ge ); Comanche Nation v. Fox , 128 S.W.3d 745, 750 (Tex. App.

— Austin 2004 , no pet. ) (noting that to meet first Cradd ock prong, movant mu st su ppo rt factual allegations in m otion with affidavit providing “ some excuse, though not necessarily a good excuse ” for failing to appear or answer with respect to default jud gment)

.

The Udenzes ’ motion for rehear ing w as not verifie d or accompanied by a n

a ffid avit, and n o ne of their atta ched “ documentary evidence ” was veri fied or otherwise
auth enticated. Thus, assuming that the Craddock test applies to this case , the mere allegations in
the Udenzes ’ motion for reh earin g w ere insuffi cient to support reh earing u nder the Cr addock
test

. See Anderson , 963 S.W.2d at 2 19 ; see al so Adekoya v. Adekoya , No. 03

- 1 6

- 00 1 95

- CV, 2017 WL 3902945, at * 1 (Tex. App.

— Austin Aug. 24, 2017, no pet. ) ( mem. op.) ( “ The facts alleged in the [ Cr

a ddoc k ] motion for new trial must b e suppor ted by affidavit s or other competent evidence. ” )

. How ev er, even if the DMV could properly have considered the unverifie d a llegations in the Udenzes ’ motion and its un authen ticated attached documents in
determ in ing whether to gr ant the motion , thos e allega tions and documents do not support the
first Craddoc k el ement because they c ontain no explanation for the Udenzes ’ failure to request a hearing. Anth ony states in his motio n for r ehearing that he had been “ co opera ting ” with DMV agents regarding th ese viol ations since be fore the NODD was sent and had been com mu n icating with Tallant via telephone and email since receiving the NODD but that Tallant “ did not m ention any date for my response or compliance to th e is sues on this case b ut only that I shoul d get ba ck
to her after changing our business address. ” Howev er , he d oes not allege in the motion any facts to explain why he did not request a hearing . For instanc e, he does not allege that he believed
Tallant had const rued h is commu nications as a heari ng reque st , that he was misled by the
DMV in any way about the e xplicit hearing

- request requirements noted in the NODD and11

accompanying materials , that he m isundersto od the hearing

- request requirements, or that any DM V com munications w aived the hearing

- re quest re quirement

. 3 He simply offered no explanation or excuse f

or why he did not request a hearing. Under these circumstances and on
th is re c ord , w e hold that the D MV did not abuse its di s cretion in denying the Uden zes ’ motion
for r e hearing

. S ee Holt A therton Indus., Inc. v. Heine , 835 S.W .2d 80, 82

– 83 (Tex. 1992) ( holding that trial cou rt did not abuse discretion in denyi ng motion for new trial b ecause supporti ng a ffidavit provided nothing more than conclusory alle gatio ns , wit hout a n y supporting
fac t s , regar di ng first Cra ddock element) ; se e also Paul v. ATX Lender 5 , LLC , No. 03

- 21

- 00346

- CV , 2023 WL 1998890, at * 5 (Tex. App.

— Austin Feb. 15, 2023, no pet. h. ) (mem. op.) (hold ing
that trial court did not abuse its discre tion in fi nding t hat f irst Craddock element was not met where party made mere conclusory statement that h is failure to timely ans wer suit was neither
intentional nor resu lt of conscious indifference and there was controverting evidence in record).
We over rule the Udenzes ’ second issue.

In their t hird issue, the Ud enzes contend that the DMV deprived them of their right to due process by beginning to negotiate with them after re ceiving their initial ema il

co rrespondenc e but not construing the corresponde nce a s a hearing req uest

. Th ey cite t he
supre me court ’ s Mosley opinion in support of their ar gu ment. S e e Mosley v. Texas Health &
Hum. Servs. Comm ’ n , 593 S.W.3d 250, 263, 268 (Tex. 201 9)

. A lthough w e acknowledg e the supreme court ’ s admonition in Mosley that remand may be r equired wh en a n ag ency ’ s

a ffirmative misdire ction has deprived a pa rty of its right t o judici al review and to due process,

3 As alrea dy noted, Anthony ’ s own ad mission that he did no t receive Tallant ’ s n ego ti ation attempt until Dec ember 15

— well after the period for requesting a hearing had expired

— belies any argument he might have made that Tallant misled him into thinking that t he DMV h a d deemed his emai l or pho ne correspondence sufficient to constitute a h ea ring request.12

the record does not support the application of the Mosley rule here. See id. (observing that

a gency ’ s affirmativ e mis direction to pa rty about proper p r ocedure s to seek judicial r eview of adverse orde r deprived party o f due process when she f ollowed such mis direction and thereb y failed to file requisite motion for rehea ring to perfect appeal ). The facts in Mosley ar e dis tinguishable fr om those her e beca use the Udenzes have not cited any evidence in th e record
that the DM V made any affirmative misrepresentation con cerning the procedures for requesting a hearing

. Cf. id. at 255

– 56

. Furthermore, the procedural posture in M osley i s di stin guis hable
because the agen cy ’ s misdirection there resulted in the r eviewing court ’ s lacking juris diction ( due to the appellant ’ s failure t o file a motion for r ehearing), wh ereas here this Cour t ’ s juris diction over the Udenzes ’ direct ap peal is not at issue because the Udenz es filed a motion for rehearing and thereby h ad t he opportunity to be heard and have such ruling reviewed on appeal. Finally, unlike in Mosley , the Udenzes made no argument and alleged no facts in their motion for
reh earin g that they reli ed to their detrim ent on t he DMV ’ s representations. We overrule the Udenzes ’ third is sue.
CONCLUSION

Having overrule d the Udenzes ’ issues, we affirm the D MV ’ s final order.

__________________________________________ Thomas J

. Baker , Justice
Before Justices Baker, T heofanis, and Jone s *
Affirmed Filed: June 2 2 , 2023

* Befor e J. Wo odfin Jones, Chief Justice (Retired), Third Co urt of Appeals, sit ting by assi gn ment. See Tex. Gov ’t Code § 74.003(b)

.