Opinion ID: 2831433
Heading Depth: 2
Heading Rank: 2

Heading: Substantive Law Governing Sanctions

Text: The sanction at issue here concerns pleadings, and its propriety is thus primarily governed by Chapter 10 of the Texas Civil Practice and Remedies Code and Texas Rule of Civil Procedure 13.6 Chapter 10 allows sanctions for pleadings filed with an improper purpose or that lack legal or factual support. It provides that upon signing a pleading or motion, a signatory attests that: (1) the pleading or motion is not being presented for any improper purpose, including to harass or to cause unnecessary delay or needless increase in the cost of litigation; (2) each claim, defense, or other legal contention in the pleading or motion is warranted by existing law or by a nonfrivolous argument for the extension, modification, or reversal of existing law or the establishment of new law; [and] 6 Chapter 9 of the Texas Civil Practice and Remedies Code also addresses frivolous pleadings and claims, but its application is limited to proceedings in which neither Rule 13 nor Chapter 10 applies. See T EX . C IV . P RAC . & R EM . C O D E § 9.012(h); see also Low, 221 S.W .3d at 614 (noting “Chapter 9 of the Texas Civil Practice and Remedies Code only applies in proceedings in which neither Rule 13 nor Chapter 10 applies”). Chapter 9 has largely been subsumed by subsequent revisions to the code. See Cynthia Nguyen, An Ounce of Prevention is Worth a Pound of Cure?: Frivolous Litigation Diagnosis Under Texas Government Code Chapters 9 and 10, and Texas Rule of Civil Procedure 13, 41 S. T EX . L. R EV . 1061, 1083–84 (2000) (theorizing “it would be difficult to conceive of a scenario in which Chapter 9 would be applicable,” and noting that “there are only a handful of cases that even cite Chapter 9, and these date from before the 1999 amendment to Section 9.012”). 8 (3) each allegation or other factual contention in the pleading or motion has evidentiary support or, for a specifically identified allegation or factual contention, is likely to have evidentiary support after a reasonable opportunity for further investigation or discovery . . . . TEX . CIV . PRAC. & REM . CODE § 10.001.7 Pleadings that violate these Chapter 10 requirements are sanctionable. Id. § 10.004(a). But a court may not sanction a represented party under section 10.001 for unfounded legal contentions. Id. § 10.004(d). Rule 13 provides that pleadings that are groundless and in bad faith, intended to harass, or false when made are also sanctionable: The signatures of attorneys or parties constitute a certificate by them that they have read the pleading, motion, or other paper; that to the best of their knowledge, 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. Attorneys or parties who . . . make statements in pleading which they know to be groundless and false, for the purpose of securing a delay of the trial of the cause, shall be held guilty of a contempt . . . . Courts shall presume that pleadings, motions, and other papers are filed in good faith. No sanctions under this rule may be imposed except for good cause, the particulars of which must be stated in the sanction order. “Groundless” for purposes of this rule 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. Importantly, Rule 13 does not permit sanctions on the issue of groundlessness alone. Rather, the filing in question must be groundless and also either brought in bad faith, brought for the purpose of harassment, or false when made. Id. We have held that in order to safeguard constitutional due process rights, a sanction must be neither unjust nor excessive. We promulgated this standard most clearly in TransAmerican, 811 7 Section 10.001 of the Civil Practice and Remedies Code is worded similarly to Federal Rule of Civil Procedure 11(b). See Low, 221 S.W .3d at 615. 9 S.W.2d at 913. The underlying case in TransAmerican was complex and multi-partied. Id. at 914. In brief, TransAmerican’s president was sanctioned for discovery abuse pursuant to Rule of Civil Procedure 215 for failing to appear at a deposition. Id. at 915–16. In considering whether those sanctions complied with due process, we established a two-part test. The first prong of the TransAmerican test concerns the relationship between the conduct evinced and the sanction imposed and requires a direct nexus between the offensive conduct, the offender, and the sanction award. See id. at 917. A just sanction must be directed against the abusive conduct with an eye toward remedying the prejudice caused to the innocent party, and the sanction must be visited upon the true offender. Id. A court must attempt to determine whether the offensive conduct is attributable to counsel only, to the party only, or to both. Id. Yet we warily noted in TransAmerican that apportioning blame between an attorney and a represented party “will not be an easy matter in many instances.” Id. Such caution is warranted. The closeness that typically defines interaction between a litigant and his attorney not only binds their interests but may lend an overall opacity to the relationship that renders it difficult to determine where a party’s input ends and where an attorney’s counsel begins. The second prong of the due process analysis under TransAmerican considers the proportionality of the punishment relative to the misconduct and warns “just sanctions must not be excessive.” Id. Not only should a punishment (i.e., sanctions) fit the crime (i.e., the triggering offense), the sanction imposed should be no more severe than necessary to satisfy its legitimate purposes. Id. Legitimate purposes may include securing compliance with the relevant rules of civil 10 procedure, punishing violators, and deterring other litigants from similar misconduct. Spohn Hosp. v. Mayer, 104 S.W.3d 878, 882 (Tex. 2003). We require courts to consider less stringent sanctions and weigh whether such lesser sanctions would serve to promote compliance. TransAmerican, 811 S.W.2d at 917.8 Evidencing our reticence to wield the heavy hammer of sanctions, we have cautioned: “[c]ase determinative sanctions may be imposed in the first instance only in exceptional cases when they are clearly justified and it is fully apparent that no lesser sanctions would promote compliance with the rules.” Tanner, 856 S.W.2d at 729. Historically, awards for groundless pleadings in Texas have been moderate, at least in monetary terms. See id. at 730 (reversing a sanctions award of $150,000 in attorney’s fees for groundlessness and discovery non-compliance); Dike v. Peltier Chevrolet, Inc., 343 S.W.3d 179, 183 (Tex. App.—Texarkana 2011, no pet.) (reversing a groundless pleadings sanction of $15,353); Parker v. Walton, 233 S.W.3d 535, 538 (Tex. App.—Houston [14th Dist.] 2007, no pet.) (reversing a groundless pleading sanction of $3,500 in attorney’s fees); Emmons v. Purser, 973 S.W.2d 696, 699 (Tex. App.—Austin 1998, no pet.) (reversing a groundless pleadings sanctions award of $3,200); see also Robson v. Gilbreath, 267 S.W.3d 401, 405 (Tex. App.—Austin 2008, pet. denied) (affirming a groundless pleadings sanction of $10,000 for failure to conduct a reasonable inquiry). 8 See also Chrysler Corp. v. Blackmon, 841 S.W .2d 844, 849 (Tex. 1992) (citing TransAmerican to note that “[a] permissible sanction should, therefore, be no more severe than required to satisfy legitimate purposes. This means that a court must consider relatively less stringent sanctions first to determine whether lesser sanctions will fully promote compliance, deterrence, and discourage further abuse”). 11 While this tour d’horizon is not intended to be comprehensive, it is nonetheless representative of what our reported cases suggest have been typical groundless pleadings awards in this state.9 Though we specifically addressed sanctions stemming from a charge of discovery abuse in TransAmerican, we have previously held the due process requirements we established there apply to pleadings sanctions as well. Low, 221 S.W.3d at 619–20.