Opinion ID: 1655350
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Heading Rank: 1

Heading: WaiverRight to Appeal

Text: The court does not reach the question of Continental's standing to appeal the adverse judgment against its insured, SHWC; rather, the court holds that whether or not Continental had standing to appeal, that such right was waived by Continental's voluntary payment of the policy limits to the plaintiff, Huizar. The court says that Continental has waived its rights, if any, because it admits payment; yet the court chooses to disregard Continental's explanation that their payment was not voluntary. In concluding that the present record is insufficient for us to conclude that the payment of the policy limits to the Huizars was anything but voluntary, p. 430, the court purports to follow Highland Church of Christ v. Powell, 640 S.W.2d 235 (Tex. 1982). This was a suit to determine the validity of ad valorem taxes assessed on an office building owned by the church. The record showed that the church paid the judgment on the disputed taxes to prevent the taxing authorities from taking steps to collect the taxes before the appeal was determined. Among other things, the church asserted that the payments were not made voluntarily but were made under implied duress. The church paid the judgment to avoid the resulting embarrassment should execution issue. The court of appeals reversed the judgment of the trial court and dismissed the cause as moot after the church paid the judgment rendered against it. The supreme court, in a unanimous opinion, reversed the judgment of the court of appeals and remanded the cause to that court for determination of the merits of the appeal. The court held that the payment of a judgment which is apparently voluntary does not waive one's right to appeal if, under the facts of the case, duress may fairly be implied. The duress brought to bear on Continental by the settlement between its insured and the plaintiff was certainly the equal of that faced by the appellant in Powell. In this settlement, SHWC agreed to dismiss its appeal and assign a major part of any claims it might have against Continental to Huizar in return for Huizar's covenant not to execute. Huizar and SHWC then initiated an action against Continental alleging claims under the Stowers doctrine, G.A. Stowers Furniture Co. v. American Indemnity Co., 15 S.W.2d 544 (Tex.Comm'n App.1929, holding approved), and the Deceptive Trade Practices Act, Tex.Bus. & Com.Code Ann. § 17.41 et seq. (Vernon Supp.1987). I have no quarrel with the rule that voluntary payment of a judgment moots an appeal, but such payment must actually settle the controversy between the parties. Padgitt v. Young County, 111 Tex. 98, 229 S.W. 459 (1921). It seems unreasonable to conclude that Huizar has taken the policy limits in settlement of its judgment against the insured. If it has, then indeed the present appeal is moot as is the Stowers /DTPA claims presently pending in Hidalgo county. In Powell, the court discussed the basis underlying the voluntary payment rule: The basis for this rule is to prevent a party who has freely decided to pay a judgment from changing his mind and seeking the court's aid in recovering the payment. A party should not be allowed to mislead his opponent into believing that the controversy is over and then contest the payment and seek recovery. Voluntary payment ends the controversy, and appellate courts will not decide moot cases involving abstractions. 640 S.W.2d at 236. Here, no one has been misled into believing that Continental's payment under protest ended the present controversy. In holding that the present appeal is moot, the majority has merely shifted the issues which might have been resolved in the present appeal, such as the liability of the insured, to another forum, the subsequently filed Stowers /DTPA suit. Plasky v. Gulf Ins. Co., 160 Tex. 612, 335 S.W.2d 581 (1960) indicates that had Continental simply tendered the policy proceeds into the registry of the court, rights to appeal would have been unaffected. Because Huizar's acceptance of the policy proceeds here apparently does not end the controversy between the parties, I would hold that Continental's tender of the policy proceeds, under protest, but at the direction of the insured, likewise does not moot its right to appeal.