Court Opinion

ID: 4682081
Source: CourtListenerOpinion
Date Created: 2021-04-29 09:15:34.442576+00
Date Added: 2024-06-11T09:02:18.474128
License: Public Domain

COURT OF APPEALS
                       EIGHTH DISTRICT OF TEXAS
                            EL PASO, TEXAS

                                        §
MRC PERMIAN COMPANY,
                                        §
            Appellant/Cross Appellee,
                                        §
v.
                                        §
POINT ENERGY PARTNERS PERMIAN                    No. 08-19-00124-CV
LLC; TJ BAR, LLC; TUBB MEMORIAL,        §
AN OREGON LIMITED                                   Appeal from the
PARTNERSHIP; PLAINSCAPITAL              §
BANK, TRUSTEE FOR THE DEBORAH                     143rd District Court
JACKSON REVOCABLE TRUST;                §
BANK OF AMERICA, N.A., TRUSTEE                  of Loving County, Texas
FOR THE JANELLE JACKSON                 §
MARITAL TRUST PART M2, JANELLE                     (TC# 17-06-869)
JACKSON MARITAL TRUST PART              §
M1, AND FAMILY CREDIT SHELTER
TRUST PART B; VORTUS                    §
INVESTMENT ADVISORS, LLC; JOHN
SABIA; and BRYAN MOODY,                 §

          Appellees/Cross-Appellants.   §

                                        §

                                  --- AND ---

                                        §
MRC PERMIAN COMPANY,
                                        §
                    Appellant/Cross Appellee,                     No. 08-21-00065-CV
                                                     §
  v.                                                                 Appeal from the
                                                     §
  HOLLAND ACQUISITIONS, INC.,                                      143rd District Court
  D/B/A HOLLAND SERVICES;                            §
                                                                of Loving County, Texas
                   Appellee/Cross-Appellant.         §
                                                                     (TC# 17-06-869)

                                                     §

                                            ORDER

       On March 15, 2021, this Court issued a majority opinion and judgment, along with an

opinion concurring in part and dissenting in part, in Cause No. 08-19-00124-CV. Three days later,

on March 18, 2021, Appellee/Cross-Appellant Holland Acquisitions, Inc. (Holland), gave notice

in that cause under Texas Rule of Appellate Procedure 8.1 that it had filed for Chapter 7 bankruptcy

in the United States Bankruptcy Court, District of Delaware, Cause Number 21-10374-JTD, on

February 4, 2021. See TEX.R.APP.P. 8.1 (provision permitting a party’s filing of a notice of

bankruptcy and setting forth the notice requirements).

                              Withdrawal of Opinions and Judgment

       Federal law provides that once a petition in bankruptcy is filed, it operates as an automatic

stay against the commencement or continuation of any judicial, administrative, or other

proceedings against the debtor. 11 U.S.C. § 362(a). Any actions taken in violation of the automatic

stay, including judgments or other court actions, are voided. Kalb v. Feuerstein, 308 U.S.433, 440

(1940). Because an appeal is a continuation of judicial action, it is automatically stayed if it is

“against the debtor.” 11 U.S.C. § 362(a). Generally, if the debtor was the plaintiff in the court

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below, the stay does not apply; if the debtor was the defendant, or one of several defendants, as

was the case here, any further action in the cause is automatically stayed. Marcus, Stowell & Beye

Gov’t Sec., Inc. v. Jefferson Inv. Corp., 797 F.2d 227, 230 n.4 (5th Cir. 1986). Further, the Texas

Rules of Appellate Procedure state:

          A bankruptcy suspends the appeal and all periods in these rules from the date
          when the bankruptcy petition is filed until the appellate court reinstates or
          severs the appeal in accordance with federal law.

TEX. R. APP. P. 8.2.

         By virtue of the above-mentioned rules, this case was stayed as of February 4, 2021, even

though we were not aware of the bankruptcy filing until March 18, 2021. In that short interim, we

unknowingly issued a majority opinion and a concurring and dissenting opinion, and a judgment,

in Cause No. 08-19-00124-CV. Having now received notice of Holland’s bankruptcy, we

withdraw said opinions and judgment of March 15, 2021. This order does not preclude reissuance

of the same or substantially the same opinions and judgment in this cause—or in an appeal severed

as to Holland once the bankruptcy stay is lifted. Howell v. Thompson, 839 S.W.2d 92, 92 (Tex.

1992).

                                   Severance and Reinstatement

         Texas Rule of Appellate Procedure 8.3 provides that a “party may move to sever the appeal

with respect to the bankrupt party and to reinstate the appeal with respect to the other parties.” See

TEX.R.APP.P. 8.3(b). Accordingly, on April 14, 2021, Point Energy Partners Permian LLC (Point

Energy), Appellee/Cross-Appellant of Cause No. 08-19-00124-CV, filed an Unopposed Motion to

Sever Appellee Holland, and the motion contained a certificate of conference indicating that

counsel for all other parties were not opposed to the severance. Rule 8.3 requires that such motion

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“show that the case is severable and must comply with applicable federal law regarding severance

of a bankrupt party.” Id. We agree that, because the other parties to the appeal in that cause did not

file for bankruptcy, the automatic stay due to Holland’s bankruptcy does not apply to any of those

parties. See In re Southwestern Bell Tel. Co., 35 S.W.3d 602, 604 (Tex. 2000) (“When a defendant

files a bankruptcy petition, an automatic stay goes into effect and abates any judicial proceeding

against that party. However, the stay only operates against the debtor, and does not operate against

non-debtors or even co-debtors, co-tortfeasers, or co-defendants.”). Moreover, the non-bankrupt

parties cannot benefit from the stay afforded to Holland. See Lisanti v. Dixon, 147 S.W.3d 638,

642 (Tex. App.—Dallas 2004, pet. denied).

       Accordingly, we grant Point Energy’s motion to sever the appeal of Cause No. 08-19-

00124-CV with respect to Holland. See TEX.R.APP.P. 8.3(b). The Clerk shall create Cause No. 08-

21-00065-CV, styled MRC Permian Company v. Holland Acquisitions Inc., d/b/a Holland

Services, and shall note in the severed cause that the Clerk’s and Reporter’s Records in Cause No.

08-19-00124-CV shall serve as the Clerk’s and Reporter’s Records in the severed cause. The

severed appeal will remain removed from our active docket and the parties shall promptly inform

this Court of the resolution of Holland’s bankruptcy proceeding or any other event authorizing

reinstatement of that appeal. See TEX. R. APP. P. 8.3(a).

       Further, Cause No. 08-19-00124-CV is reinstated pursuant to TEX. R. APP. P. 8.3(b). The

Clerk of this Court is ordered to re-style Cause No. 08-19-00124-CV as MRC Permian Company

v. Point Energy Partners Permian LLC; TJ Bar, LLC; Tubb Memorial, an Oregon Limited

Partnership; PlainsCapital Bank, trustee for the Deborah Jackson Revocable Trust; Bank of

America, N.A., trustee for the Janelle Jackson Marital Trust Part M2, Janelle Jackson Marital

                                                  4
Trust Part M1, and Family Credit Shelter Trust Part B; Vortus Investment Advisors, LLC; John

Sabia; and Bryan Moody.

       Aside from our opinions and judgment, which are withdrawn, any paper filed in Cause No.

08-19-00124-CV while the proceeding was suspended will be deemed filed on this day—but after

this severance and reinstatement—and will not be considered ineffective because it was filed while

the proceeding was suspended. See TEX. R. APP. P. 8.2. Having been reinstated, the appeal in Cause

No. 08-19-00124-CV shall proceed in due course.

       IT IS SO ORDERED THIS 28TH DAY OF APRIL, 2021.

                                             GINA M. PALAFOX, Justice

Before Rodriguez, C.J., Palafox, and Alley, JJ.

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