Court Opinion

ID: 4517760
Source: CourtListenerOpinion
Date Created: 2020-03-19 10:14:13.677745+00
Date Added: 2024-06-11T09:19:39.568886
License: Public Domain

GRANTED and Opinion Filed March 17, 2020

                                          S   In the
                                Court of Appeals
                         Fifth District of Texas at Dallas
                                      No. 05-19-01239-CV

                                  IN RE EDUKID, LP, Relator

                  Original Proceeding from the County Court at Law No. 7
                                   Collin County, Texas
                           Trial Court Cause No. 007-01603-2017

                             MEMORANDUM OPINION
                          Before Justices Bridges, Osborne, and Carlyle
                                   Opinion by Justice Carlyle
       Relator Edukid, LP seeks a writ of mandamus compelling the trial court to: (1) vacate its

order striking the property-value testimony of Edukid’s manager; and (2) enter a protective order

stating that Edukid’s corporate representative cannot be deposed on certain expert-witness issues.

We conditionally grant mandamus on both grounds in this condemnation proceeding involving a

Montessori school and real party in interest, the City of Plano.

       To be entitled to mandamus relief, a relator must show both that the trial court has clearly

abused its discretion and that relator has no adequate appellate remedy. In re Prudential Ins. Co.,

148 S.W.3d 124, 135–36 (Tex. 2004) (orig. proceeding); In re Colonial Pipeline Co., 968 S.W.2d
938, 941 (Tex. 1998) (orig. proceeding). “A trial court abuses its discretion when it acts in an

unreasonable or arbitrary manner” and “when it acts without reference to guiding rules and

principles.” In re Colonial Pipeline Co., 968 S.W.2d at 941. In addition, mandamus is appropriate
when the trial court compels discovery beyond what is permitted under the rules of civil procedure.

In re Nat’l Lloyds Ins. Co., 532 S.W.3d 794, 802 (Tex. 2017) (orig. proceeding).

                                        Property-Owner Rule

          Generally, a property owner is qualified to testify to the value of her property even if she

is not an expert and would not be qualified to testify to the value of other property. See Reid Road

Mun. Utility Dist. No. 2 v. Speedy Stop Food Stores, 337 S.W.3d 846, 853–54 (Tex. 2011) (citing

Porras v. Craig, 675 S.W.2d 503, 504 (Tex. 1984)). The rule is based on the presumption that an

owner will be familiar with her own property and know its value. Id. Organizations are the same

as natural persons for purposes of the Property-Owner Rule. Id. at 852–53. The entity can prove

the value of its property through certain officers or employees whose management positions

warrant applying a presumption that they are familiar with the entity’s property and its value. Id.

at 854.

          Relator designated Effie Saifi to testify regarding the partnership property’s value in this

case. Ms. Saifi is the manager of the limited partnership, which garners her the presumption she is

familiar with Edukid’s property and its value. See id. Other record evidence supports her personal

familiarity with and knowledge concerning the property, and insufficient evidence rebuts either

the presumption or this evidence. See id. at 849. Ms. Saifi is thus qualified to testify to the market

value of Edukid’s property pursuant to the Property-Owner Rule. See id. at 855; id. at 858–59

(Willett, J., concurring).

          Reid specifically held that subject to Rule 701 of the Texas Rules of Evidence (i.e.,

allowing a property owner to testify regarding value based on personal familiarity with the

property and its value), a witness who will be giving opinion evidence about a property’s fair

market value must be disclosed and designated as an expert pursuant to discovery and other

applicable rules. Id. at 851–52; see also Teal Trading & Dev. LP v. Champee Springs Ranches

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Prop. Owners Ass’n, 534 S.W.3d 558, 577 (Tex. App.—San Antonio 2017, pet. granted) (property

owner need not be designated or disclosed as an expert to testify as to value of property). So, Ms.

Saifi’s testimony is “subject to rule 701,” at least in part, and there is no requirement that her fair-

market-value testimony be treated like expert testimony. The City relies on footnote 6 in Natural

Gas Pipeline Co. of America v. Justiss to support its contention that a witness giving opinion

evidence about a property’s fair market value must nevertheless be disclosed and designated as an

expert pursuant to discovery rules, but this reliance is misplaced. See 397 S.W.3d 150, 157 n.6

(Tex. 2012).

       Justiss specifically states that the Property-Owner Rule is an exception to the requirement

that a witness must otherwise establish his qualifications to express an opinion on land values. Id.

at 157. This is a restatement of settled law. The City’s citation to footnote 6 for the proposition

that a Property-Owner-Rule witness must be “disclosed and designated as an expert” depends on

a misreading of the note and its context. It also ignores Reid and the genesis of the Property-Owner

Rule in Rule 701. Footnote 6 contains a quote from Reid that omits the phrase “subject to the

provisions of Rule 701,” a nod to the Property-Owner Rule that would except otherwise expert

testimony from Rule 702’s expert-testimony requirements due to the close relationship between

the witness and the property. See Reid, 337 S.W.3d at 852–53. Footnote 6 quotes the portion of

Reid discussing Rule 702, separate from its discussion of Rule 701 in that case, and most

importantly, separate from its discussion of the Property-Owner Rule in that case. See Justiss, 397
S.W.3d at 157; Reid, 337 S.W.3d at 851–53. Parties seeking to include Property-Owner-Rule

witnesses as part of their evidentiary presentation must do only as much disclosing or designating

of these witnesses as they would of any other lay-opinion witness.

       Edukid gave notice that Ms. Saifi would testify pursuant to the Property-Owner Rule and

provided sufficient disclosure thereof. See Almeter v. Bastrop Cent. Appraisal Dist., No. 03-17-

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00092, 2017 WL 4478217, at *4 (Tex. App.—Austin Oct. 5, 2017, pet. denied) (mem. op.) (noting

that, because property owner failed to properly designate herself as an expert, though she did

disclose herself as a witness, see id. at *4 n.9, she could only testify pursuant to the Property-

Owner Rule). The City and the trial court put the cart before the horse. Instead of having Ms.

Saifi’s deposition, which would have given both the trial court and this court a record of the

testimony she would provide and bases for her opinions as to the property’s fair market value, 1 the

City moved to strike her testimony for lack of expert notice and designation, and the trial court

granted it. At least part of Ms. Saifi’s presentation is Property-Owner Rule testimony. The extent

of that is impossible to define at this juncture, but it is clear enough that the trial court abused its

discretion in striking the designation of her as a lay witness.

          Because Ms. Saifi was not required to be designated as an expert or to provide an expert

report to testify as to the market value of the property as a property owner under Rule 701, the trial

court clearly abused its discretion by prohibiting her from testifying at trial as to fair market value

pursuant to the Property-Owner Rule. See Justiss, 397 S.W.3d at 157; Reid, 337 S.W.3d at 851–

53. We do not foreclose the possibility that, after reviewing Ms. Saifi’s testimony, the City may

still have concerns regarding its admissibility pursuant to the Property-Owner Rule. At that point,

after there is a record of her opinions and bases, the motion to strike might be subject to further

consideration by the trial court.

          But before we can issue mandamus to correct the trial court’s abuse of discretion in

granting the City’s motion to strike Ms. Saifi’s lay-witness designation, we must determine

whether Edukid would have an adequate remedy on appeal. See In re CVR Energy, Inc., 500
S.W.3d 67, 80 (Tex. App.—Houston [1st Dist.] 2016, orig. proceeding). The test as to whether

      1
        See Justiss, 397 S.W.3d at 155–56 (discussing Property-Owner-Rule testimony requirements pursuant to Porras v. Craig, 675 S.W.2d 503,
504 (Tex. 1984)); Grapevine Diamond, L.P. v. City Bank, No. 05-14-00260-CV, 2015 WL 8013401, at *12–13 (Tex. App.—Dallas Dec. 7, 2015,
pet. denied) (mem. op.) (discussing lay opinion witnesses’ testimony and bases).

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there is an adequate appellate remedy is practical and prudential, not subject to simple categories

or bright-line rules, and requires the careful balancing of jurisprudential considerations. Id. The

analysis includes “consideration of the degree to which ‘important substantive and procedural

rights’ are subject to ‘impairment or loss.’” Id. (quoting In re Prudential Ins. Co., 148 S.W.3d at

136).

        Although mandamus review of incidental interlocutory rulings that are unimportant to the

ultimate disposition of a case or the uniform development of the law distract the appellate courts

and add expense and delay to the process, mandamus review of significant rulings in exceptional

cases might be required to preserve significant substantive or procedural rights, provide legal

guidance on issues that prove elusive to address on appeal, or spare parties and the public the

money and time wasted in reversing improperly conducted proceedings. Id. at 81. The most

frequent use of mandamus relief has involved cases where the very act of proceeding to trial,

regardless of the outcome, would defeat the substantive right involved. See In re McAllen Med.

Ctr., Inc., 275 S.W.3d 458, 465 (Tex. 2008) (orig. proceeding). But it also provides value when a

trial court erroneously excludes evidence that leaves a party’s claims so “significantly

compromised” that a substantial part of their case would be omitted from the trial. In re Garza,

544 S.W.3d 836, 843 (Tex. 2018) (orig. proceeding).

        Edukid has an inadequate remedy on appeal. This is a condemnation case, and the excluded

property-owner evidence is unique testimony regarding the value of the property. “[T]he central

damage issue in the typical condemnation case is how to measure the market value of the

condemned property.” City of Harlingen v. Sharboneau, 48 S.W.3d 177, 182 (Tex. 2001). Texas

courts have long held it appropriate, in the context of condemnation proceedings, for a jury to

consider “all factors . . . which would reasonably be given weight in negotiations between a seller

and a buyer” of the property. Collin Cty. v. Hixon Family P’ship, Ltd., 365 S.W.3d 860, 870 (Tex.

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App.—Dallas 2012, pet. denied) (citing City of Austin v. Cannizzo, 267 S.W.2d 808, 815 (Tex.

1954)). Given that, and though Edukid has indicated it intends to present other witnesses to

complete the picture of its damages model, Edukid’s ability to present viable claims or defenses at

trial is at least severely compromised. See Garza, 544 S.W.3d at 843–44. No other witness

possesses the type of personal knowledge of the property’s use as a Montessori school it appears

Ms. Saifi will provide jurors as the property owner. Edukid’s remedy by appeal is inadequate under

these circumstances. See id. at 840 (appeal is an inadequate remedy “where a party’s ability to

present a viable claim or defense at trial is either completely vitiated or severely compromised.”).

                                                            Protective Order

            On September 16, 2019, Edukid filed a Motion for Protective Order concerning the noticed

deposition of its corporate representative. In this proceeding, Edukid confines its complaints to

four noticed topics (1, 2 13, 3 14, 4 and 16 5) on which it sought to compel the trial court to enter a

protective order shielding its representative from being deposed on issues concerning testifying

experts.

            A trial court has broad discretion in granting a protective order. In re Eurecat US, Inc., 425
S.W.3d 577, 582 (Tex. App.—Houston [14th Dist.] 2014, orig. proceeding). To justify a protective

order, a party seeking to avoid discovery must produce sufficient facts to show particular, specific,

and demonstrable injury. Brewer & Pritchard, P.C. v. Johnson, 167 S.W.3d 460, 466 (Tex. App.—

Houston [14th Dist.] 2005, pet. denied). To decide whether a protective order is appropriate, a trial

court balances the parties’ competing interests. See Garcia v. Peeples, 734 S.W.2d 343, 348 (Tex.

     2
       Deposition Topic No. 1: “Edukid’s communications with any other party, excluding your attorneys, regarding this lawsuit and its subject
matter, more particularly described as Cause No. 007-01603-2017; City of Plano, Texas vs. Edukid, LP; pending in the County Court at Law
Number Seven, Collin County, Texas (the ‘lawsuit’).”
     3
         Deposition Topic No. 13: “Communications with witnesses, including expert witnesses, relating to the lawsuit and the Property.”
     4
         Deposition Topic No. 14: “Communications relating to Edukid, LP’s discovery responses in this lawsuit.”
     5
       Deposition Topic No. 16: “The expert opinions of and on behalf of Edukid, LP disclosed in response to discovery requests in this case,
including but not limited, to the opinions of Dorwin Sargent, Phillip Morse, Richard Davis, and Effie Saifi.”

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1987) (holding trial court should have balanced parties’ competing needs before granting

protective order).

       Here, Edukid’s complaints about the denial of a protective order are focused on whether

Ms. Saifi should be deposed on issues involving the opinions of Edukid’s experts, including

herself, pursuant to the trial court’s rulings. This issue is intertwined with whether Ms. Saifi’s

testimony on property value is considered expert or lay testimony. As we note above, she is

testifying as a lay witness under Rule 701. Thus, Ms. Saifi is protected from being deposed as an

expert and should only be deposed as a fact witness on otherwise permissible topics.

       Also, the real party in interest may not use the corporate representative’s deposition to learn

the bases for Edukid’s experts’ opinions. The Texas Rules of Civil Procedure allow expert

discovery only through requests for disclosure, expert reports, and expert depositions. See TEX. R.

CIV. P. 195.4 (“In addition to disclosure under Rule 194, a party may obtain discovery concerning

the subject matter on which the expert is expected to testify, the expert’s mental impressions and

opinions, the facts known to the expert (regardless of when the factual information was acquired)

that relate to or form the basis of the testifying expert’s mental impressions and opinions, and other

discoverable matters, including documents not produced in disclosure, only by oral deposition of

the expert and by a report prepared by the expert under this rule.” (emphasis added)). It was an

abuse of discretion for the trial court to permit discovery beyond that allowed under the rules of

civil procedure, for which mandamus is an appropriate remedy. See In re Nat’l Lloyds Ins. Co.,
532 S.W.3d at 802.

       We therefore conditionally grant mandamus relief in this case. The writ will issue only if

respondent fails to: (1) vacate its order prohibiting Ms. Saifi from providing lay testimony

concerning the value of the partnership’s property; (2) vacate the portion of its order denying

Edukid’s motion for a protective order to the extent it deals with deposition questions concerning

                                                 –7–
the opinions of testifying experts; and (3) enter a protective order stating that the deposition of

Edukid’s corporate representative may not include questions concerning the opinions of testifying

experts.

                                                  /Cory L. Carlyle/
                                                  CORY L. CARLYLE
                                                  JUSTICE

191239f.p05

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