Court Opinion

ID: 6500581
Source: CourtListenerOpinion
Date Created: 2022-07-18 00:15:35.442099+00
Date Added: 2024-06-11T09:18:02.584710
License: Public Domain

Reversed and Remanded and Memorandum Opinion filed July 14, 2022.

                                     In The

                    Fourteenth Court of Appeals

                             NO. 14-20-00725-CV

  BLAINE M. STANDIFORD AND SHERYL E. STANDIFORD, Appellant

                                       V.
                      CITIMORTGAGE, INC., Appellee

               On Appeal from the County Court at Law No. 2
                           Travis County, Texas
                 Trial Court Cause No. C-1-CV-17-005410

                         MEMORANDUM OPINION

      Appellants Sheryl and Blaine Standiford challenge a final order granting the
release of a $19,800 cash bond posted by appellants to appellee CitiMortgage, Inc.
In a single issue, appellants argue that the trial court abused its discretion by
releasing the bond. We reverse and remand.
                                     I.      BACKGROUND1

       At a foreclosure sale on August 7, 2012, CitiMortgage obtained an interest
in a property in Lago Vista, Texas.2 The foreclosure and CitiMortgage’s
subsequent attempts to take possession of the property have resulted in numerous
appeals. See Standiford v. CitiMortgage, Inc., No. 14-18-00061-CV, 2019 WL
3997106, at *1 (Tex. App.—Houston [14th Dist.] Aug. 22, 2019, no pet.) (mem.
op.); Standiford v. CitiMortgage, Inc., No. 03-15-00625-CV, 2016 WL 4177237, at
*1 (Tex. App.—Austin Aug. 4, 2016, pet. dism’d w.o.j.) (mem. op.); Standiford v.
CitiMortgage, Inc., No. 03-14-00344-CV, 2015 WL 6831578, at *1 (Tex. App.—
Austin Nov. 3, 2015, pet. denied) (mem. op.).

       On April 26, 2017, CitiMortgage filed a forcible detainer suit against the
Standifords in justice court in Travis County, Texas. The justice court found that
the Standifords were “tenant[s] at sufferance pursuant to the foreclosure held
August 7, 2012, and that [CitiMortgage] is entitled to judgment for possession of
the premises.” The Standifords appealed to county court, which entered final
summary judgment in favor of CitiMortgage. On November 27, 2017, the court
amended its summary judgment order, setting a supersedeas bond at $1,100 a
month if the Standifords chose to pursue an appeal of the county court’s judgment.
The Standifords then appealed the county court’s judgment.

       In August 2019, we rejected the Standifords’ appeal of the eviction
       1
         The Texas Supreme Court ordered the Third Court of Appeals in Austin to transfer this
case to the Fourteenth Court of Appeals. We must therefore decide the case in accordance with
the precedent of the Third Court of Appeals if our decision otherwise would have been
inconsistent with that court’s precedent. See Tex. R. App. P. 41.3.
       2
          The facts of this case, as well as its procedural history, are well known to the parties;
therefore, we will discuss the facts of the case only to the extent they are relevant to the issues on
appeal. See Tex. R. App. P. 47.1 (“The court of appeals must hand down a written opinion that is
as brief as practicable but that addresses every issue raised and necessary to final disposition of
the appeal.”).

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judgment and affirmed the county court’s judgment awarding CitiMortgage
possession of the property. See Standiford, 2019 WL 3997106, at *1. Several
months later, in November 2019, the Standifords filed a motion to release all bond
payments to them. According to the Standifords, “[t]he purposes of the bond
ordered in this case was to protect the value of these rights in this property. . . .
Those rights now belong exclusively and solely to the Standifords.” In March
2020, CitiMortgage filed a counter-motion, outlining its claim to the bond
payments: “During the pendency of the appeal, CitiMortgage was denied the use
and possession of its property from the date of the judgment, November 17, 2017,
through the date CitiMortgage sold the Property, April 26, 2019—a total of 18
months.” Accordingly, CitiMortgage argued that it was entitled to recover
$19,800—$1,100 per month for each month it was deprived of the use and
enjoyment of the property.

      On March 30, 2020, the county court signed an order releasing the
supersedeas bond funds in the amount of $19,800, plus accrued interest, to
CitiMortgage. The Standifords filed a motion to return the bond, which the trial
court denied on May 29, 2020. The Standifords filed a timely appeal.

                    II.      RECOVERY OF SUPERSEDEAS BOND

A.    STANDARD OF REVIEW & APPLICABLE LAW

      The release of a supersedeas bond is reviewed for an abuse of discretion.
Haedge v. Central Tex. Cattlemen’s Ass’n, 603 S.W.3d 824, 827 (Tex. 2020) (per
curiam). “Under an abuse of discretion standard, we defer ‘to the trial court’s
factual determinations if they are supported by evidence,’ but review legal
determinations de novo.” Id. (quoting Stockton v. Offenbach, 336 S.W.3d 610, 615
(Tex. 2011)). A trial court abuses its discretion “when it renders an arbitrary and
unreasonable decision lacking support in the facts or circumstances of the case,” or
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“when it acts in an arbitrary or unreasonable manner without reference to guiding
rules or principles.” Samlowski v. Wooten, 332 S.W.3d 404, 410 (Tex. 2011).

      A supersedeas bond is not an unconditional agreement to pay a stated sum of
money; it imposes only a contingent or conditional liability, and its primary
purpose is security. Muniz v. Vasquez, 797 S.W.2d 147, 150 (Tex. App.—Houston
[14th Dist.] 1990, no writ). In calculating the amount of the bond to distribute to a
prevailing party, courts must determine the damage the prevailing party actually
incurred during the appeal. See Haedge, 603 S.W.3dat 828 (“[T]he initial
calculation of a supersedeas bond for appeal is different from the final calculation
of loss or damage that results from the appeal.”); McFadin v. Broadway
Coffeehouse, LLC, 539 S.W.3d 278, 285 (Tex. 2018) (“[T]he evidence presented at
the hearing setting the bond amount was evidence of what damages the appeal
might cause Coffeehouse if its judgment were not immediately enforced, not what
damages the appeal actually did cause it.”) (emphasis in original).

B.    APPLICATION

      In their sole issue, the Standifords argue that the trial court abused its
discretion by awarding the full amount of the supersedeas bond to CitiMortgage
when CitiMortgage had never claimed, or proved, damages. Because this is a
transfer case, we must determine this case as the Third Court of Appeals would
determine it. See Mitschke v. Borromeo, No. 21-0326, ___ S.W.3d ___, ___, 2022
WL 1510317 (Tex. May 13, 2022) (“Transferee courts must follow whatever law
binds the transferor court.”). Less than a year ago, the Third Court of Appeals
issued a binding opinion that addressed the same argument as raised by the
Standifords. See Adams v. Godhania, 635 S.W.3d 454, 457–58 (Tex. App.—
Austin 2021, pet. denied) (op. on reh’g).

      In Adams, the Godhanias filed suit to evict the Adams from property the
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Godhanias had purchased. Id. at 456. The Godhanias prevailed, and the Adams
appealed to county court. Id. The justice of the peace set the total bond at $7,000
during the pending appeal. Id. Because of the value of the property, the Godhanias
asked the county court to set a supersedeas bond at $144,000. The trial court
believed that estimate was low, and set the total for the supersedeas bond at
$168,000, allowing the $7,000 bond posted by the justice court to be credited
towards the new amount. Id. at 457. The Adams appealed the judgment awarding
possession to the Godhanias, but that judgment was affirmed; the Adams
immediately surrendered possession of the property. Id. The Godhanias
subsequently filed a motion to release the bond. The Adams argued that the
Godhanias were not entitled to recover any amount of the supersedeas bond
because they only sought possession; the Godhanias did not plead or prove
damages at trial. Id. Additionally, the Adams urged that the court’s determination
of the supersedeas bond is not equivalent to a determination of damages. Id.
Nevertheless, the trial court released the full amount of the bond funds to the
Godhanias.

      On appeal, the Third Court of Appeals agreed with the Adams “to the extent
that [the Godhanias] are required to prove the amount of damages ‘actually
incurred’ during the appeal.” Id. at 458 (quoting Muniz, 797 S.W.2d at 150). The
court then noted the following concerning the calculation of damages:

      A court may not summarily ascertain the amount of monetary
      damages occasioned by delay in appeal. When a judgment [holder]
      claims loss or damages resulting from the appeal, the [judgment
      holder] must prove the extent of the damage. Loss or damage in the
      supersedeas context refers to monetary or material losses ascertainable
      by proof, either by the judgment itself, or, where that is not
      conclusive, by evidence relating to proof of damages generally. When
      the supersedeas bond covers rental amounts that accrue while the case
      is on appeal, the rental amounts cannot be determined on appeal, but

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      instead must be determined by proof of facts transpiring after
      judgment and during the pendency of appeal. Such a determination is
      made by the trial court following the completion of the appeal.

Id. at 458–59 (internal citations and quotations omitted). Accordingly, the Austin
court agreed with the Adams that the trial court abused its discretion by releasing
the full amount of the bond to the Godhanias without hearing any evidence of the
loss or damage they actually incurred during the appeal. Id. at 459.

      However, the appellate court explicitly disagreed with the Adamses’
argument that the Godhanias “‘waived’ their right to recover any amount of the
bond by failing to plead for damages incurred during the appeal and that the trial
court is prohibited from awarding appellees any amount of the bond because
damages incurred during the appeal were not awarded in the judgment.” Id. In
reaching this conclusion, the court noted that the Adams attempted to rely on
Texas Rules of Civil Procedure Rule 510.11, which provides that in an appeal of a
forcible detainer case from the justice court to the county court, “[o]n the trial [de
novo] of the case in the county court the appellant or appellee will be permitted to
plead, prove and recover his damages, if any, suffered for withholding or
defending possession of the premises during the pendency of the appeal.” See Tex.
R. Civ. P. 510.11; Adams, 635 S.W.3d at 460. The court rejected the Adamses’
argument: “However, in this case, [the Adams] are seeking to recover damages
incurred during the time period in which [they] appealed the county court’s
judgment to this Court. Thus, Rule 510.11 does not apply here.” Adams, 635
S.W.3d at 460.

      The court additionally rejected the Adamses’ contention that the Godhanias
could not recover damages that they did not plead:

      [The Adams] also cite to cases holding that “a judgment must be
      supported by the pleadings” and that “a party may not be granted

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      relief in the absence of pleadings to support that relief.” It is true that
      [the Godhanias], by pleading for possession only, cannot recover any
      damages incurred prior to the county court’s judgment. But [they]
      may recover damages that were actually incurred during the pendency
      of the appeal of the county court’s judgment to this Court. However,
      such damages could not be pleaded by [the Godhanias] or included in
      the trial court’s judgment because they would be incurred after the
      county court’s judgment had been rendered. The judgment here
      awarded possession of the property to [the Godhanias] and set bond in
      the amount of $168,000 to suspend enforcement of the judgment. An
      order releasing the bond to [the Godhanias], provided that it is limited
      to the amount of damages [they] actually incurred during the
      pendency of the appeal, is not inconsistent with that judgment.

Id. (citations omitted). Accordingly, the Third Court of Appeals reversed the trial
court’s order releasing the full amount of the supersedeas bond to the Godhanias
and remanded the case to the trial court to hear evidence and determine the actual
damages suffered by the Godhanias during the pendency of the appeal. Id.

      The case here presents the same issue as Adams. We agree with the
Standifords inasmuch as they assert that the trial court abused its discretion in
dispersing the bond funds to CitiMortgage without holding a hearing. See id. While
CitiMortgage offered evidence to support the award of $19,800, that evidence did
not reflect the damages CitiMortgage actually incurred; it only served as evidence
of the damages CitiMortgage might suffer because of the appeal. See id.

      However, we disagree with the Standifords’ argument that CitiMortgage has
no right to a hearing on its damages. It is true that CitiMortgage cannot recover
damages prior to the county court’s judgment, but it can recover damages incurred
during the pendency of the appeal of the county’s court’s judgment to the court of
appeals. See id. The Standifords argue that CitiMortgage waived its right to claim
damages because it failed to amend its pleadings to seek damages pursuant to
Texas Rules of Civil Procedure Rule 510.11. But as the court concluded in Adams,

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Rule 510.11 does not apply here; Rule 510.11 deals with damages “during the
period from which the justice court renders judgment to the time the county court
renders judgment” whereas CitiMortgage seeks damages during the time period in
which the Standifords appealed the county court’s judgment to the appellate court.
Adams, 635 S.W.3d at 459–60; see Tex. R. Civ. P. 510.11. Additionally,
CitiMortgage did not waive any claim to its damages for failing to plead them
because such damages could not be plead by CitiMortgage or be included in the
county court’s judgment; the damages would only have been incurred after the
county court’s judgment had already been rendered. See Adams, 635 S.W.3d at
460.

       Accordingly, we reverse the trial court’s order releasing the supersedeas
bond funds to CitiMortgage and remand the case to the trial court to hear evidence
to determine the damages actually incurred by CitiMortgage during the pendency
of the appeal—from the date of the county court’s judgment until the date the
Standifords surrendered possession of the property. We sustain in part and overrule
in part the Standifords’ sole issue.

                                 III.   CONCLUSION

       We reverse the trial court’s order releasing the supersedeas bond funds to
CitiMortgage and remand the case to the trial court for further proceedings
consistent with this opinion.

                                        /s/       Margaret “Meg” Poissant
                                                  Justice

Panel consists of Justices Bourliot, Poissant, and Wilson.

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