Source: https://iclg.com/practice-areas/litigation-and-dispute-resolution/litigation-and-dispute-resolution-2017/usa-texas
Timestamp: 2017-09-24 17:33:03
Document Index: 93409192

Matched Legal Cases: ['§ 38', '§ 16', '§ 16', '§ 33', '§ 33', '§ 41', '§ 71', '§ 41', '§ 35', '§ 35', '§ 36', '§ 154', '§ 154', '§ 154', '§ 154', '§ 154', '§ 154', '§ 154', '§ 154', '§ 171', '§ 171', '§ 171', '§ 171']

Litigation & Dispute Resolution 2017 | Laws and Regulations | USA – Texas | ICLG
Home Practice area Litigation & Dispute Resolution USA – Texas
The law of Texas is derived from the Constitution of Texas and consists of constitutional, statutory, and regulatory laws, as well as case law and local laws. Civil procedure is governed by the Texas Rules of Civil Procedure (TRCP) and the Texas Civil Practices and Remedies Code. The objective of the rules is to obtain an equitable and impartial adjudication of the rights of litigants. TRCP 1.
TRCP: http://www.txcourts.gov/media/1435952/trcp-all-updated-with-amendments-effective-912016.pdf.
Tex. Civ. Prac. Rem. Code: http://www.statutes.legis.state.tx.us/?link=CP.
The Texas court system consists of a Supreme Court, which is the highest state appellate court for civil matters and only reviews questions of law; 14 courts of appeals, which have intermediate appellate jurisdiction and consider both factual and legal issues; and four levels of trial courts - district courts, county courts, justice courts, and statutory country courts. Larger counties also have specialized probate courts.
The amount in controversy is the main factor that determines a court’s subject matter jurisdiction. District courts have jurisdiction over cases in which the amount in controversy exceeds $500; there is no upper limit. It shares jurisdiction with the county courts, and in some cases, justice courts. However, the district court has exclusive jurisdiction on suits for slander or defamation, title to land, and election contest. County courts hear cases with a general controversy range of $200.01–$10,000. Statutory County Courts have the same minimum as county courts, but have a maximum of $200,000. Justice courts have jurisdiction over civil cases in which the amount of controversy is up to $10,000, but have exclusive jurisdiction over matters under $200. They are not empowered to grant injunctions or issue writs of mandamus. The decisions of justice courts are subject to de novo review.
The main stages of a civil case are:
Filing a petition/service of process.
Defendant’s pleadings.
Discovery (interrogatories, requests for disclosure, requests for production, requests for admissions, and depositions).
Pre-trial Motions.
Trial/Verdict.
The discovery time period depends on the control plan alleged by plaintiff in her petition. TRCP 190. Generally, discovery requests must be served on a party no later than 30 days before the end of the discovery period. Responses are due within 30 days after service of the request.
Rule 190.2 provides for abbreviated trials for cases under $50,000, which includes a shorter time period for discovery and a limitation on the number of discovery requests.
Forum Selection clauses are generally enforceable in Texas. See In re Nationwide Ins. Co. of Am., 494 S.W.3d 708 (Tex. 2016).
Costs of civil proceedings are assessed by the court at the conclusion of litigation. Generally, each party to a suit is liable to the court for costs he has incurred. TRCP 125. However, the successful party to a suit can recover all incurred costs from his adversary, unless the court decides otherwise for “good cause”. TRCP 131, 141. The base filing fee is approximately $250; however, it can vary by location and complexity of the case.
Texas follows the American Rule, which provides that there can be no recovery of attorney’s fees unless authorised by contract or statute. In Texas, a person may recover reasonable attorney’s fees from an individual or corporation for certain claims provided in the Texas Civil Practices and Remedies Code § 38.001, including, but not limited to breach of contract actions.
Contingent fees are permissible in cases other than criminal cases and most family law cases. A contingent fee agreement must be in writing and state the method by which the fee is to be determined. It must specify the expenses that will be deducted from the recovery, and whether the expenses will be deducted before or after the contingent fee is calculated. Tex. Disciplinary Rules of Prof. Conduct 1.04.
As a general rule, causes of action are freely assignable. State Farm Fire & Cas. Co. v. Gandy, 925 S.W.2d 696 (Tex. 1996). However, a lawyer is prohibited from acquiring a proprietary interest in the litigation he is conducting for a client. Tex. Disciplinary R. Prof’l Conduct 1.08.
Although third-party litigation funding is a growing field in the United States, a uniform regulatory framework has not been adopted as of yet. Generally, Texas courts will examine whether funding agreements are predatory, the extent of the control exercised by the funder, and the extent to which similar agreements would burden the judicial system. Anglo-Dutch Petroleum Int’l, Inc. v. Haskell, 193 S.W.3d 87, 104 (Tex. App.—Houston [1st dist.] 2006, pet. denied).
A court may require a party seeking relief to give security for costs at any time before final judgment. If the party fails to comply on or before 20 days after notice that such rule has been entered, the claim for affirmative relief will be dismissed. TRCP 143.
To initiate a civil action, a plaintiff must file a petition, which serves to give fair notice to the parties and to guide the trial judge for the purpose of admitting evidence and in charging the jury. TRCP 22.
Tex. Civ. Prac. Rem. Code §§ 16.002–16.004 governs statute of limitations in Texas. Libel and slander claims must be brought no later than one year after the day the cause of action accrues; claims for trespass, conversion, personal injury, injury to property, forcible entry and detainer must be brought no later than two years after the day the cause of action accrues; finally, a suit for breach of contract, debt, fraud, or breach of fiduciary duty must be brought no later than four years after the day the cause of action accrues. The residual limitations period in actions for which there is no express limitations period is four years. § 16.051.
The legal injury rule provides that a cause of action “accrues” when all facts come into existence that authorise a claimant to seek a judicial remedy, even if all damages have not yet occurred. Accrual does not depend on when the plaintiff learns of the injury. Provident Life and Acc. Ins. v. Knott, 128 S.W.3d 211 (Tex. 2003). The discovery rule makes the legal injury rule irrelevant, but is only applicable in limited cases, including defamation, negligent misrepresentation, and actions against fiduciaries. It tolls the accrual of a cause of action until the plaintiff discovers or, through the exercise of reasonable care and diligence, should discover her injury. Childs v. Haussecker, 974 S.W.2d 31 (Tex. 1998).
Statutes of limitations are considered procedural rather than substantive bars to bringing an action in Texas. In re Ford Motor Co., 442 S.W.3d 265 (Tex. 2014).
Service is obtained by providing the person served with a copy of the citation and petition via personal delivery or certified mail. TRCP 106. Service on a non-resident defendant can be made while he is present within the state, except in limited circumstances. Otherwise, to be served, the non-resident defendant must have “minimum contacts with the forum state such that the traditional notions of fair play and substantial justice are served”. Once this test is met, service is accomplished by serving the secretary of state, who will then send notice to the defendant by registered mail. TRCP 108.
Rule 108a provides six ways to serve a defendant in a foreign country, including in person or via mail.
Section 5 of the TRCP is dedicated to injunctions. To apply for an injunction, such as a temporary restraining order, the applicant must present his petition to the judge with an affidavit stating the grounds for a TRO. The opposing party must be served with notice unless immediate and irreparable harm will result before notice can be served. TRCP 682. The TRO is valid for 14 days but can be extended an additional 14 days.
In order to investigate a potential claim pre-suit, a person may petition the court for an order authorising a pre-suit deposition. Rule 202.1.
A claimant’s petition should contain allegations of jurisdiction, venue, discovery level, names of the parties and their residences, causes of action, and damages sought. TRCP 47. The operative facts pleaded by the plaintiff to support his cause of action should show: A right of the plaintiff, a breach of that right by the defendant, the plaintiff’s injury, and a remedy.
An amended pleading supersedes the prior pleading and must be complete in itself. TRCP 63. It may be made without leave of court if it is made more than seven days prior to trial and does not cause surprise to the opposing party.
A claimant can file for dismissal of a suit, i.e., a non-suit, so long as the defendant has not made a claim for affirmative relief, at any time before the claimant has introduced all of his evidence other than rebuttal evidence. TRCP 162.
The primary function of the defendant’s answer is to set forth her grounds of defence. TRCP 45. Generally, answers contain dilatory pleas, which delay or defeat an action without determining the merits of the matter, such as special appearances (Rule 120a), motions to transfer venue (Rule 86), special exceptions (Rules 90, 91) or pleas in bar, which seek a determination on the merits. Pleas in bar include general and special denials, verified denials, and affirmative defences found in Rule 94.
The defendant must file a written answer by 10 a.m. on the first Monday after the expiration of 20 days from the date the defendant was served with process. TRCP 99(b).
A defendant can seek to designate a person as a responsible third party by filing a motion for leave to designate that person. The motion must be filed on or before the 60th day before the trial date unless the court finds good cause. Tex. Civ. Prac. Rem. Code § 33.004. A defendant can also file cross-claims (TRCP 97e) and third-party claims (TRCP 38).
If a defendant fails to appear and file an answer within the proper time allowed by law, a court may enter a default judgment against the defendant. TRCP 107, 238, 239.
A defendant can file a special appearance motion objecting to the personal jurisdiction of the court, but it must be filed first or else he subjects himself to the jurisdiction of the Texas courts. TRCP 120a.
Before a case is called for trial, additional parties may be brought in by the plaintiff or defendant, but in a manner that does not unreasonably delay the trial of the case. TRCP 37. Rule 40 allows a plaintiff to join parties, but requires commonality among the claims in the lawsuit. The right asserted by or against the parties must arise out of the same transaction, occurrence, or series of transactions or occurrences.
Rule 38 allows a defendant to add new parties if the claims are derivative – the original defendant claims that the newly added party is or may be liable to the defendant or the plaintiff for at least part of plaintiff’s claim against the defendant. (See also Tex. Civ. Prac. Rem. Code § 33.004.) A defendant with a counterclaim against the plaintiff may add a new party to the counterclaim so long as the claims against the plaintiff and the new party arise out of the same transaction or occurrence. TRCP 97(f).
When actions involving a common question of law or fact are pending before the court, it may order a joint hearing or trial of any or all the matters at issue. TRCP 174(a).
When joinder is improper, courts will sever the improperly joined claims. The court may also order severance “to do justice, avoid prejudice, and further convenience”. TRCP 174(b). Severance is proper where: 1) the controversy involves more than one cause of action; 2) the severed claim would be the proper subject of a lawsuit if it were asserted independently; and 3) the claim to be severed is not so interwoven with the remaining claims that two trials will involve the same facts and legal issues. Rule 41. The trial on punitive damages may also be bifurcated at the election of the defendant. Tex. Civ. Prac. Rem. Code § 41.009.
The cases are allocated to specific civil courts according to subject matter and the amount in controversy. (See question 1.2 above.)
Once the plaintiff alleges a discovery control plan (level 1, 2, or 3), the court will release a scheduling order, which typically includes the trial date and guidelines regarding objections to expert testimony, amended pleadings, additional parties, and mediation. TRCP 190.4.
TRCP 11 provides that a court may sanction attorneys or parties who submit pleadings for an improper purpose or that contain frivolous arguments that have no evidentiary support. TRCP 215 provides for sanctions if parties fail to comply with the discovery rules.
A party may move to dismiss a cause of action on the ground that it has no basis in law or facts. It must be filed within 60 days after the first pleading containing the challenged cause of action is served, and granted or denied within 45 days after the motion is filed. TRCP 91a.
TRCP 166a governs summary judgment procedures. A court can render judgment for the movant when it is shown that 1) there are no genuine issues of material fact and the movant’s summary judgment evidence establishes an entitlement to judgment as a matter of law or 2) there is no evidence of one or more essential elements of a claim or defence on which the adverse party has the burden of proof. The resulting judgment may be rendered on the whole case or certain claims or defences.
A court may grant a motion to stay or dismiss an action for various reasons including the death of a party, forum non conveniens, or dismissal for want of prosecution. A court can decline to exercise jurisdiction under forum non conveniens and stay or dismiss the action if it finds that a claim is more proper in another forum. Tex. Civ. Prac. Rem. Code § 71.051. A case may also be dismissed for want of prosecution on failure of any party to appear for a hearing or trial of which the party had notice. TRCP 165a.
A party may obtain information from another party by serving interrogatories, requests for disclosure, requests for admission, and/or requests for production. A party may use requests for disclosure and interrogatories to inquire into parties’ names, potential parties, legal theories and factual basis of the party’s claim and defences, damages, potential witnesses, insurance or settlement agreements, medical bills, and any responsible third party. TRCP 196.2, 197. To obtain discovery of electronic information, the requesting party must specifically request production of it and specify the form in which it wants it produced. Rule 196.4. Requests for admissions try to identify facts that are not disputed; a party serves them to request that the other party admit the truth of any matter within the scope of discovery. Rule 198.
A pre-suit deposition is the only discovery mechanism available pre-action. Rule 202.1.
Article 5 of the Texas Rules of Evidence (TRE) governs privilege. Generally, Texas recognises the attorney-client privilege, clergy member privilege, trade secrets privilege, physician-patient privilege (except in proceedings against a physician). Rules 503(b), 505, 507, 509. A party who claims privilege may withhold the material or information from the response, but must state that it has been withheld for the purpose of asserting privilege. TRCP 193.3.
A party may compel discovery from a non-party only by obtaining a court order or by serving a subpoena. TRCP 205.1.
A court may sanction and/or order a party to produce information it is wrongfully withholding. TRCP 192.3, 215.2.
The court may make any order in the interest of justice to protect the movant from undue burden, unnecessary expense, harassment, annoyance, or invasion of rights. A protective order may mandate that the requested discovery not be sought in whole or part, subject matter be limited, discovery not be undertaken at the time or place specified, and/or results of discovery be sealed. TRCP 192.6.
Relevant evidence is admissible unless the Constitution or statutory authority provides otherwise. Irrelevant evidence is not admissible. TRE 402. Evidence is relevant if it has any tendency to make a fact more or less probable than it would be without the evidence and the fact is of consequence in determining the action. Rule 401. The court may exclude relevant evidence if its probative value is substantially outweighed by a danger of unfair prejudice, confusing the issues, misleading the jury, undue delay, or needlessly presenting cumulative evidence. Rule 403.
Texas Rules of Evidence can be found here: http://www.txcourts.gov/media/921665/tx-rules-of-evidence.pdf.
There are limitations to the admission of evidence that is otherwise relevant. Generally, evidence of a person’s character is not admissible to prove that on a particular occasion the person acted in accordance with the character or trait. There are exceptions where a party is accused of conduct involving “moral turpitude”. TRE 404. Rules 406-411 discuss other limitations.
Hearsay is not admissible unless otherwise provided. Rule 802. Rules 803–806 discuss the exceptions to the rule against hearsay.
An expert may base an opinion on facts or data in the case that the expert has been made aware of, reviewed, or personally observed. The facts or data need not be admissible under the Rules of Evidence for the opinion to be admitted. Rule 703.
Opinion testimony by lay witnesses is limited to one that is rationally based on the witness’s perception and helpful to clearly understanding the witness’s testimony or to determining a fact in issue. TRE 701. A party may compel any witness to attend deposition or trial by serving a subpoena. TRCP 199.3, 200.2.
A party may request another party to disclose information concerning testifying expert witnesses through a request for disclosures, depositions, and expert reports. TRCP 195.1. Testifying experts must disclose all documents, tangible things, reports, models or data reviewed or prepared by the expert in anticipation of providing testimony. Rule 192.3. An expert’s opinion is inadmissible if the underlying facts or data do not provide a sufficient basis for the opinion. TRE 705. On the other hand, discovery of the identity and opinions of consulting experts, who help a litigant prepare the case for discovery and trial, is not permitted. TRCP 192.3(e).
If the defendant fails to appear, the plaintiff may be entitled to a default judgment. (See question 4.4 above.) A party may also move to dismiss a cause of action on the grounds that is has no basis in law or fact. (See question 6.4 above.) If the litigation presents no genuine issue of material fact, the court may dispose of the case through summary judgment. (See question 6.5 above.)
If the case proceeds to trial and the jury has a verdict, the judge can accept the jury’s findings or it can enter a judgment for one party even though the jury returned a verdict for the opposing party, known as judgment notwithstanding the verdict. TRCP 300, 301.
The court has wide discretion in awarding economic damages and other compensatory damages on a case by case basis. However, there are statutory limitations on an award for exemplary damages. Exemplary damages may be awarded only if the claimant proves by clear and convincing evidence that the harm results from fraud, malice, or gross negligence. §§ 41.003, 41.004, 41.008.
The court’s power in regard to costs and attorney’s fees is discussed in question 1.5 and 1.8 above.
A judgment in one state is enforceable in every state in the United States. A copy of the authenticated judgment is filed in the office of the clerk of any court of the state. It has the same effect and is subject to the same procedures, defences, and proceedings for reopening, vacating, staying, enforcing or satisfying a judgment as a judgment of the court in which it is filed. Tex. Civ. Prac. Rem. Code § 35.003. At the time the judgment is filed, the judgment creditor must file an affidavit showing the name and address of the judgment debtor and creditor. The creditor must then mail notice of the filing of the judgment to the debtor and file proof of the mailing with the court clerk. § 35.004.
A foreign country judgment that is filed with notice as mentioned above is enforceable and is entitled to full faith and credit. § 36.004.
Any party who seeks to alter the trial court’s judgment must file a written notice of appeal to the trial court clerk within 30 days from the date the judgment is signed. Tex. R. App. Proc. 25. Briefs must be filed in the court of appeals. To prevent execution on the judgment, an appellant must file a bond with the trial court. Texas Rules of Appellate Procedure can be found here: http://www.txcourts.gov/media/514722/TRAP_2014_01_01.pdf.
TRCP 167 governs offers of settlement. A settlement offer may not be made until a defendant files a declaration invoking the rule, within 60 days after the appearance in the case, or within 14 days before the date the case is set for trial. The offer must be in writing and state the terms by which all monetary claims may be settled. Rule 167.2.
Mediation and Arbitration are the most common methods of alternative dispute resolution, but there are other methods available in Texas. Mediation is a forum in which an impartial person, the mediator, facilitates communication between parties to promote reconciliation, settlement, or understanding among them. Tex. Civ. Prac. Rem. Code § 154.023. Nonbinding arbitration is similar to Mediation, but the impartial third party renders a specific award. If the parties stipulate in advance, the award is binding. § 154.027.
A Mini-trial is conducted under an agreement of the parties. Each side presents its respective position, either before selected representatives for each party or before an impartial third party. The impartial third party may issue a non-binding (unless the parties agree otherwise) advisory opinion regarding the merits of the case. § 154.024.
A Moderated Settlement Conference is similar to a mini-trial, but with a panel of impartial third parties who also issue a non-binding advisory opinion. § 154.025.
In a Summary Jury Trial, each side presents its position before a panel of jurors. The panel may issue a non-binding advisory opinion. § 154.026.
Alternative Dispute Resolution procedures are governed by the Civil Practices and Remedies Code, Chapter 154.
A party’s contract may limit the claims that can be resolved by alternative dispute resolution.
A court may refer a pending dispute for resolution by an alternative dispute resolution procedure. The court must confer with the parties in determining the most appropriate procedure. Tex. Civ. Prac. Rem. Code § 154.021. The court may also appoint an impartial third party who is agreed on by the parties to aid in resolving the dispute. A party may file a written objection to the referral within 10 days of receiving notice. § 154.022.
Alternative dispute resolution methods are binding only if agreed upon in advance by the parties. If the parties did not stipulate that the award will be binding, dispute resolution serves only as a basis for further settlement negotiations. If the parties reach a settlement during the proceeding and execute a written agreement, the agreement is enforceable. Tex. Civ. Prac. Rem. Code § 154.071.
A written agreement to arbitrate is valid and enforceable in Texas. The agreement must be to arbitrate a controversy that exists at the time of the agreement or arises between the parties after the date of the agreement. § 171.001. The court will confirm the award from a valid arbitration and enter a judgment unless grounds are offered for vacating, modifying, or correcting an award. §§ 171.087-171.088, §§ 171.091-171.092. An arbitration order is appealable in the same manner as an appeal from an order or judgment in a civil action. § 171.098.
There are a number of alternative dispute resolution companies that operate in Texas.
JAMS – Judicial Arbitration and Mediation Services, Inc. provides arbitration, mediation and other ADR services globally, including cities in Texas.
AAA – American Arbitration Association is a not-for-profit organisation that provides services to individual and organisations who wish to resolve conflicts out of court. It is headquartered in New York City but has an office in Dallas, Texas.
There are a number of other private mediation services.