# sopremecourt 11

- u155 ORIGINAL APR 11 2011 T|^XA&&£)t»T OFAPPEALS, THIRD DISTRICT, ATAUSTIN 

## BLAKEHWrm^ ' Deputy By. JUDGMENT RENDERED JANUARY 13,2011

NO. 03-10-00280-CV
Roger Sluder, Appellant

Carol Joyce Ogden, Appellee

APPEAL FROM THE 424TH DISTRICT COURT OF BLANCO COUNTY BEFORE CHIEF JUSTICE JONES, JUSTICES PEMBERTONAND HENSON AFFIRMED

-- OPINION BY JUSTICE HENSON

THIS CAUSE came on to be heard on the record of the court below, and the same being 

### considered, because it is the opinion of this Court that there was no error in the trial court's order: IT IS THEREFORE considered, adjudged and ordered that the order ofthe trial court is 

### in all things affirmed. It is FURTHER ordered that the appellant pay all costs relating to this 

### appeal, both in this Court and the court below; and that this decision be certified below for
observance.

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

NO. 03-10-00280-CV
Roger Sluder, Appellant

Carol Joyce Ogden, Appellee
FROM THE DISTRICT COURT OF BLANCO COUNTY, 424THJUDICIAL DISTRICT NO. CV06875, HONORABLE DANIEL H. MILLS, JUDGE PRESIDING

MEMORANDUM OPINION 

### AppellantRoger Sluderfiled suit against Carol Joyce Ogden alleging anownership interest in a tract of land andrequesting both an injunction against Ogden's sale of the land and 

### unspecified damages. Ogden filed amotion for Rule 13 sanctions against Sluder and hisattorney, claiming that the petition was groundless and filed in bad faith because Sluder had no interest in the 

### property. SeeTex. R. Civ. P. 13. After a hearing,the trial court dismissedthe action with prejudice 

### andgranted themotion for sanctions, ordering Sluder and his attorney to pay$2,000 in attorney's fees to Ogden's counsel. Sluder appeals, alleging that the trial court abused its discretion because 

### (1) the petition was not groundless, (2) Sluder did not sign the pleadings, and therefore sanctions againsthim were improper, and (3) the sanctions violatedthe Texas Constitution. We affirm the trial court's order.BACKGROUND On November 4, 2009, Sluder filed an original petition for damages and injunctive relief in Blanco County District Court. The petition alleged that Carol Joyce Ogden, Sluder's mother, was attempting to sell a 10.66-acre tract ofland in which Sluder claimed an ownership interest ("Tract 58"). Sluderrequested that the court issue an injunction ofthe sale and unspecified damages. He attached a warranty deed, recorded in Blanco County in 2005, that conveyed Tract 58 solely to Ogden. Sluder did not present any other facts in his petition to support his alleged ownership interest in the property. Ogden then filed an answer and motion for sanctions pursuant to Rule 13 ofthe Texas Rules ofCivil Procedure, seeking sanctions against Sluderfor filing, and his attorney for signing, a pleading that was groundless and brought in bad faith. See id. In support of the motion for sanctions, Ogden and her husband, Sydney Ogden, provided affidavits stating that they were "titled and equitable co-owner[s]" ofTract 58. Ogden also attached an affidavit by the previous ownerofthe property stating that Ogdenhad purchased the property pursuant to a contract for deed, paid for the property in full, and fulfilled all obligations under the contract. Sluder's attorney responded by filing a motion to quash Ogden's sanctions motion and requesting his own Rule 13 sanctions "because the Defendant has presented false and misleading affidavits for the factfinder." The trial court held a single hearing on both motions for sanctions. At the hearing, Sluder revealed that his primary evidence as to his interest in Tract 

### 58was the contract for deed, executed in 1984,in which Ogden and Sluder agreedto make payments to the seller in exchange for title to the property once all payments had been made. Ogden testified that she tendered all payments on the contract. Sluder conceded that he had no evidence to thecontrary andthatthe 2005 warranty deedwas in Ogden's name alone. However, Sludertestified that 

### he believed he had an interest in the property through a verbal agreement with Ogden regarding a rental property that she managed. He claimed that Ogden collected rent for a duplex that he owned 

### and that Ogden used this rent money to satisfy the contract for deed. Sluder acknowledged that the duplex was in Ogden's name, and offered no proof, apart from his testimony, that he owned the duplex. 

### With respect to Sluder's assertion that Ogden intended to sell the property, Ogden testified that the property was not for sale, nor had she ever attempted to sell it in the past. Sluder conceded that his only evidence in support ofhis claim that Ogden was selling Tract 58 was that a 

### neighbor had mentioned to him that Ogden was interested in selling the property. At the conclusion ofthe hearing, the trial court issued an order finding that Sluder filed, and his attorney signed, pleadings that were groundless, brought in bad faith, and brought for the purpose ofharassment. It then dismissed the case with prejudice and ordered Sluder and his attorney to pay $2,000 to Ogden's counsel as attorney's fees. This appeal followed.

STANDARD OF REVIEW Wereview atrial court's award ofsanctions for an abuse ofdiscretion. Low v. Henry, 221 S.W.3d 609, 614 (Tex. 2007). In matters committed to a district court's discretion, the test is whetherthe ruling was unreasonable or arbitrary or whetherthe court acted without reference to any guiding rules or principles. Lake TravisIndep. Sch. Dist. v. Lovelace, 243 S.W.3d 244, 249 (Tex. App.—Austin 2007, no pet.). In deciding whether the denial ofsanctions constitutes an abuse of discretion, we examine the entire record, reviewing the conflicting evidence in the light mostfavorable to the trial court's ruling and drawing all reasonable inferences in favor ofthe court's judgment. Id. at 250.

DISCUSSION Because Sluder's briefidentifies both Sluderand his attorney as appellants, we begin by addressing whether Sluder's attorney is properly before us as an appellant in this case. Courts have held that nonparties have a right to appeal from ajudgment ifthey clearly have an interest in 

### the judgment and are bound by it. See Torrington Co. & Intersoll-Rand Corp. v. Stutzman, 46 S.W.3d 829, 843 (Tex. 2000) (stating that person whose interest is prejudiced by error in judgment has standing to appeal judgment); In re Evans, 130 S.W.3d 472, 478-79 

### (Tex. App.—Houston [14th Dist.] 2004, orig. proceeding) (holding nonparty with interest in 

### judgmenthad right to appeal when bound byjudgment); Jernigan v. Jernigan,677 S.W.2d 137,140 (Tex. App.—Dallas 1984, no writ) (holding nonparty bound byjudgment was entitled to appeal). Because the trial court's order requires that "Roger Sluder AND his attorney ofrecord" pay $2,000 to Ogden's attorney, Sluder's attorney has an interest in the order and is bound by it. Therefore, 

### Sluder's attorney has standing to appeal the trial court's imposition ofsanctions against him. In addition to standing, however, any party seeking to alter a trial court'sjudgment 

### or other appealable order must file a notice ofappeal. Tex. R. App. P. 25.1(c). The only notice of 

### appealfiledinthiscasewasonbehalfofSluder, stating, "Plaintiff, RogerSluder, herebygivesnotice 

### ofhisappeal from theTrial CourtJudgment datedJanuary 29,2010." Thenotice ofappeal doesnot list his attorney as an appellant, nor did Sluder's attorney file a noticeofappeal on his ownbehalf. Weagree withothercourtsofappeals thathaveheldthatanattorney whowishesto appeal sanctions

### must eitherjoin in a party's noticeofappeal or file his own.1 SeeMatbon, Inc. v. Gries, 287 S.W.3d 

### 739, 740(Tex. App.—Eastland 2009,no pet.) (dismissing appeal ofattorney sanctions for want of 

### jurisdiction when party lacked standing to appeal and notice of appeal did not list attorney as appellant); Niera v. Frost Natl Bank, No. 04-09-00224-CV, 2010 Tex. App. LEXIS 1709, at *4 

### (Tex. App.—San Antonio Mar. 10, 2010, pet. denied) (mem. op.) (same); Benavides v. Knapp Chevrolet, Inc., No. 01-08-00212-CV, 2009 Tex. App. LEXIS 1044, at *7-8 (Tex. App.—Houston [1stDist] Feb. 12, 2009, no pet.) (mem. op.) (holdingthatappellate court lacked 

### jurisdiction to decide appeal ofattorney who had notjoined in party's notice ofappeal). Because Sluder's attorney failed to properly file a notice of appeal, this Court lacksjurisdiction over his appeal. SeeTex. R. App. P. 25.1(c). Wetherefore will reviewonlythe trial court's imposition of sanctions against Sluder. Turningto the issues on appeal, Sluderclaims that the trial court abused its discretion 

### in imposingsanctionsunderRule 13because(1) Sluder's petitionwasnotgroundless, (2)hedid not sign the petition and thus could not be sanctioned, and (3) the trial court's order violated the
Texas Constitution. Rule 13 states, in relevant part: 

### The signatures ofattorneys or parties constitute a certificate by them that they have read the pleading, motion, or other paper; that to the best of their knowledge,


### 1 The Texas Supreme Court has expressly declined to decide whether an attorney must perfect a separate appeal apart from that perfected by his client. Braden v. Downey, 811 S.W.2d 922, 928 n.6 (Tex. 1991) ("We express no opinion on the question whether, in order to seek review of 

### sanctions by appeal, an attorney must perfect a separate appeal apart from that perfected by his client.").information, and belief formed after reasonable inquiry the instrument is not groundless and brought in bad faith or groundless and brought for the purpose of harassment.
... Ifa pleading, motion or other paper is signed in violation ofthis rule, the court, upon motion or upon its own initiative, after notice and hearing, shall impose an appropriate sanction available under Rule 215, upon the person who signed it, a represented party, or both.
Tex. R. Civ. P. 13. Rule 215 allows a courtto impose sanctions which include, among otherthings, dismissal of the proceeding with or without prejudice and attorney's fees. Tex. R. Civ. P. 215.2(b)(5), (8). In his first issue on appeal, Sluder argues that the trial court abused its discretion because the pleading was not groundless. "Groundless" for purposes ofRule 13 means no basis in law or fact and not warranted by good faith argument for the extension, modification, or reversal of existing law. Tex. R. Civ. P. 13; see also Lovelace, 243 S.W.3d at 254-56. To determine whether


### a pleading is groundless, the trial court employs an objective analysis, asking whetherthe party and counsel made a reasonable inquiry into,the legal and factual basis ofthe claim. In re United Servs. 

### Auto. Ass 'n, 76 S.W.3d 112,115 (Tex. App.—San Antonio 2002, orig. proceeding). In its inquiry, the court looks to the facts available to the litigant and the circumstances at the time the suit was 

### filed. Id.. A trial court may not base Rule 13 sanctions on the legal merit ofa pleading or motion. 

### Lovelace,243 S.W.3d at 254 (citing Emmons v. Purser,973 S.W.2d 696, 700 (Tex. App.—Austin 1998, no pet.)). Merely filing a motion or pleading that the trial court denies does not entitle the opposing party to Rule 13 sanctions. Id. 

### Sluder argues that he properly alleged "a particular piece ofreal estate which he was 

### attempting to purchase under a Contract for Deed." At the hearing, Sluder himself testified that the

### contract for deed was the primary evidence supporting his alleged ownership interest in Tract 58. However, a contract for deed merely establishes conditions precedent to a title's transfer. Graves


### v. Diehl, 958 S.W.2d 468,470-71 (Tex. App.—Houston [14th Dist.] 1997, no pet.). Title does not transfer to the buyer until these conditions are met, at which point another document is required to transfer legal title. See Flores v. Millennium Interests, Ltd., 185 S.W.3d 427,429 (Tex. 2005) ("A contract for deed, unlike a mortgage, allows the seller to retain title to the property until the purchaser has paid for the property in full."); Jennifer Yarto & DTRJ Invs., L.P. v. Gilliland, 

### 287 S.W.3d 83, 90 (Tex. App.—Corpus Christi 2009, no pet.) ("[Ljegal title does not pass under a contract for deed until the deed is actually delivered to the purchaser . . . ."). Sluder admitted that he never made any payments on Tract 58, while Ogden testified that she made all payments on the property. Sluder was also aware ofthe existence of a warranty deed giving Ogden sole
title to the land. Sluder alleged at the hearing that he had an interest in Tract 58 because Ogden used rental income from a duplex, allegedly owned by Sluder, to make payments on Tract 58. Sluder admitted, however, that the duplex was now in Ogden's name and that he had no evidence, other 

### than his "word," that he had an interest in the duplex.2 Sluder also never asserted any facts, either in his petition orat the hearing, that would supporthis allegationthat Ogdenused rental income from the duplex to fund payments for Tract 58. Based on the circumstances known to Sluder and his attorney at the time offiling, as well as those they should have known via a reasonable inquiry, the



### 2 Sluder testified that he transferred the rental property to Ogden in order to protect the property while Sluder served time in jail.trial court could have reasonably concluded that Sluder's claim oftitle had no arguable basis in law 

### or fact and was therefore groundless. Sluder's first issue on appeal is overruled.3 In his second point on appeal, Sluder argues that the trial court abused its discretion by granting Rule 13 sanctions against him because he did not sign the pleading. Rule 13 permits sanctions upon "the person who signed [the pleading], a represented party, or both." Sluder, however, contends that he was entitled to rely on the advice ofhis attorneyin filing the pleading and should not have been sanctioned. Specifically, Sluder relies on Glass v. Glass, 826 S.W.2d 683 (Tex. App.—Texarkana 1992, no writ), a divorce case in which the attorney filed several frivolous pleadings and a letterthreatening legal action. Id. at 685-86. The Glass courtheldthatthe trial court 

### erred in finding Glass culpable under Rule 13 for the acts ofher attorney, as a party should not be 

### punished for counsel's conduct unless the party is implicated apart from having entrusted its legal representationto counsel. Id. at 687-88; see also TransamericanNatural Gas v.Powell, 811 S.W.2d 913, 917 (Tex. 1991). 

### Here, Sluder and his attorney are both culpable for the groundless pleading. Sluder knew that he had never made a payment on the property, that a warranty deed recorded in Blanco County named Ogden as sole owner ofthe land, and that, as the contract for deed indicated, title to



### 3 While Ogden argues onappeal thatSluder's pleadings failed tostate acause ofaction, our affirmationofthetrialcourt's sanctions rests onSluder'sinadequate legaltheoryandisindependent of any defects in the pleading for failure to state a cause of action. See Winters v. Parker, 178 S.W.3d 103, 105-06(Tex. App.—Houston [1st Dist.] 2005, no pet.) (citingMassey v. Armco 

### Steel Co., 652S.W.2d 932,934(Tex. 1983)) ("UndertheTexas Rules ofCivil Procedure, theproper 

### way for a defendant to urge that a plaintiffhas failed to plead a cause of action is by special exception."); see also Friesenhahn v. Ryan, 960 S.W.2d 656, 658 (Tex. 1998) (holding that trial 

### court must give partyopportunity to replead before dismissing casevia special exception).

### the land would not be transferred until all payments were made. See In re Bank One, N.A., 216 S.W.3d 825, 826 (Tex. 2007) ("We presume that 'a party who signs a contract knows its 

### contents.'" (quoting Cantella &Co. v. Goodwin, 924 S.W.2d 943,944 (Tex. 1996))). Additionally, 

### astheplaintiff, itwas Sluderwho ultimately decided whetherornottoinitiate alawsuit. His lawyer did notactunilaterally infiling theinitial petition. Given Sluder's role inthefiling ofthepetition,
we conclude that the trial courtcould have reasonably found that Sluder did more than merely "entrust his legalrepresentation to counsel," making him eligible for sanctions. Sluder's second point on appeal is overruled. 

### Sluder argues in his third point on appeal that the trial court's sanctions violated the Texas Constitution. Sluder contends that the sanctions violate article I, section 13 ofthe Texas 

### Constitution, which states, "all courts shall be open, and every person for an injurydone him . . . 

### shall haveremedy by due courseof law." Tex. Const, art. I, § 13. Though dueprocess, as applied to sanctions, does require a reasonable relationship between the harm done and the sanctions 

### addressed, see Glass, 826S.W.2d at 688, Sluderhaspresented no evidence, eitherat thehearing or in his brief, which suggests that the sanctions imposed lacked a reasonable relationship with the harm done. Furthermore, courts have upheld sanctions ofattorney's fees far in excess ofthe $2,000 ordered here. See id. at 690 (upholding attorney's fees sanctions of$22,500 and $9,650 in divorce 

### proceeding); Alsheikh v. Dyab,No. 07-08-00162-CV, 2010 Tex. App. LEXIS 2511, at * 19 (Tex. App.—Amarillo Apr. 7,2010, no pet.) (mem. op.) (upholding attorney's fees sanction of$22,044.45 after two-day bench trial). We overrule Sluder's third point oferror. -:sf- 

## ?'

# *
Finally, in her brief, Ogden requests additional sanctions for filing a frivolous appeal pursuant to Texas Rule ofAppellate Procedure 45. See Tex. R. App. P. 45. The granting of sanctions is within the discretion ofthe appellate court. Id. We exercise this discretion and decline 

### to assess further sanctions, as the sanctions already imposed are sufficient to accomplish their purpose ofpunishing the present conduct and deterring similar conduct in the future. See Delgado
v. Methodist Hosp., 936 S.W.2d 479, 488 (Tex. App.—Houston [14th Dist] 1996, no writ).

CONCLUSION 

### Having overruled all ofSluder's points on appeal, we affirm the trial court's order.

Diane M. Henson, Justice Before ChiefJustice Jones, Justices Pemberton and Henson Affirmed Filed: January 13, 2013

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