Court Opinion

ID: 9900743
Source: CourtListenerOpinion
Date Created: 2023-11-20 12:07:39.371712+00
Date Added: 2024-06-11T09:21:15.444358
License: Public Domain

In the
                     Court of Appeals
             Second Appellate District of Texas
                      at Fort Worth
                  ___________________________
                       No. 02-23-00123-CV
                  ___________________________

CULBERSON-STOWERS, INC.; RICHARD W. STOWERS JR.; AND CULBERSON
           RENTAL AND LEASING CO., INC., Appellants

                                  V.

           LEASE CORPORATION OF AMERICA, Appellee

              On Appeal from County Court at Law No. 2
                       Tarrant County, Texas
                   Trial Court No. 2020-004176-2

                Before Bassel, Wallach, and Walker, JJ.
                Memorandum Opinion by Justice Bassel
                            MEMORANDUM OPINION

                                    I. Introduction

      This is an appeal from an order granting Appellee Lease Corporation of

America’s (LCA) no-evidence summary-judgment motion and dismissing with

prejudice the bill-of-review petition filed by Appellants Culberson-Stowers, Inc.;

Richard W. Stowers Jr.; and Culberson Rental and Leasing Co., Inc. In their sole

issue, Appellants argue that the trial court erred by granting LCA’s no-evidence

summary-judgment motion. Because Appellants did not meet their bill-of-review

burden of showing that the judgment was not rendered as a result of their own fault

or negligence, we affirm.

                                   II. Background

      In the underlying suit, which Appellants seek to challenge by their bill-of-

review petition, LCA filed its original petition, affidavit, and application in support of

a writ of sequestration against Appellants, and after Appellants were served, they filed

a motion to transfer venue and an original answer. Nine months after Appellants

answered, LCA filed its traditional motion for summary judgment and later filed its

notice of hearing on the summary-judgment motion. It is undisputed that Appellants’

counsel received both the summary-judgment motion and the notice of hearing on

the motion. Appellants did not file a response to the summary-judgment motion or a

motion for continuance, and they did not appear at the hearing. The trial court

granted LCA’s summary-judgment motion on February 27, 2020.

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       Five months later, Appellants filed a bill-of-review petition. Appellants argued

that they never received notice of the judgment and did not have actual knowledge of

the judgment against them until a garnishment of one or more of their bank accounts

occurred on or about June 25, 2020. LCA answered and three months later filed a

traditional summary-judgment motion, which the trial court denied.

       Shortly after the trial court denied LCA’s traditional summary-judgment

motion, Appellants filed a traditional motion for summary judgment.1 Appellants

admitted in their motion that their attorney had received a copy of LCA’s traditional

summary-judgment motion and notice of the hearing but that both the motion and

the hearing notice had been mistakenly placed in Appellants’ file at their attorney’s

office and thus had never been called to their attorney’s attention.

       One week later, LCA filed a no-evidence summary-judgment motion, arguing

that there is no evidence to support each of the bill-of-review elements. Specifically,

LCA argued that “[t]here is no evidence that the underlying judg[]ment was rendered

in the absence of [Appellants’] own fault or negligence[;] in fact, [Appellants] judicially

admit [that] they negligently failed to respond to the [m]otion or appear at the hearing

thereon.” Appellants then filed a first amended traditional motion for summary

judgment, again asking the trial court to deny LCA’s summary-judgment motion but

       Despite the timing of Appellants’ summary-judgment motion—after the trial
       1

court had denied LCA’s traditional summary-judgment motion—they pray that LCA’s
summary-judgment motion be denied and in the prayer of their motion for summary
judgment do not request the trial court to grant their motion.

                                            3
not requesting the trial court to grant their motion.        LCA filed a response to

Appellants’ traditional summary-judgment motion and objections to Appellants’

summary-judgment evidence. Eight days before the hearing on LCA’s no-evidence

summary-judgment motion, Appellants filed a second amended traditional motion for

summary judgment, still praying for the trial court to deny LCA’s summary-judgment

motion but not requesting the trial court to grant their motion.

      The trial court held a hearing on LCA’s no-evidence summary-judgment

motion 2 and granted the motion “[a]fter considering the [m]otion, the lack of any

response, and the argument of counsel.” The trial court also dismissed with prejudice

Appellants’ bill-of-review petition. The trial court signed a final judgment reflecting

its decision. See generally Lehmann v. Har-Con Corp., 39 S.W.3d 191, 195 (Tex. 2001).

      Appellants filed a motion for new trial, which the trial court denied. Appellants

then perfected this appeal.

             III. No Evidence of the Third Bill-of-Review Element

      In their sole issue, Appellants argue that the trial court erred by granting LCA’s

no-evidence summary-judgment motion. Because there is no evidence of at least one

bill-of-review element, the trial court properly granted LCA’s no-evidence summary-

judgment motion.

      2
        The record does not contain any notice setting any of Appellants’ versions of
their traditional summary-judgment motion for hearing.

                                           4
      A.     The Standard of Review and the Law Applicable to Bills of Review

      When, as here, a bill of review is disposed of through summary judgment, we

review the case de novo under the summary-judgment standard. Mandel v. Lewisville

Indep. Sch. Dist., 499 S.W.3d 65, 70 (Tex. App.—Fort Worth 2016, pet. denied). When

reviewing a no-evidence summary judgment, we examine the entire record in the light

most favorable to the nonmovant, indulging every reasonable inference and resolving

any doubts against the motion. Sudan v. Sudan, 199 S.W.3d 291, 292 (Tex. 2006). We

review a no-evidence summary judgment for evidence that would enable reasonable

and fair-minded jurors to differ in their conclusions. Hamilton v. Wilson, 249 S.W.3d

425, 426 (Tex. 2008) (citing City of Keller v. Wilson, 168 S.W.3d 802, 822 (Tex. 2005)).

We credit evidence favorable to the nonmovant if reasonable jurors could, and we

disregard evidence contrary to the nonmovant unless reasonable jurors could not.

Timpte Indus. v. Gish, 286 S.W.3d 306, 310 (Tex. 2009) (citing Mack Trucks, Inc. v. Tamez,

206 S.W.3d 572, 582 (Tex. 2006)). If the nonmovant brings forward more than a

scintilla of probative evidence that raises a genuine issue of material fact, then a no-

evidence summary judgment is not proper. Smith v. O’Donnell, 288 S.W.3d 417, 424

(Tex. 2009); King Ranch, Inc. v. Chapman, 118 S.W.3d 742, 751 (Tex. 2003).

      A bill of review is an equitable proceeding brought by a party seeking to set

aside a prior judgment that is no longer subject to challenge by a motion for a new

trial or direct appeal. Mabon Ltd. v. Afri-Carib Enters., Inc., 369 S.W.3d 809, 812 (Tex.

2012). “Courts narrowly construe the grounds on which a plaintiff may obtain a bill

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of review due to Texas’s fundamental public policy favoring the finality of

judgments.” Id. Ordinarily, a bill-of-review plaintiff must plead and prove “(1) a

meritorious defense to the underlying cause of action, (2) which the plaintiff[ ] [was]

prevented from making by the fraud, accident, or wrongful act of the opposing party

or official mistake, (3) unmixed with any fault or negligence on its own part.” Id. A

summary judgment will be granted against the bill-of-review petitioner if the

summary-judgment movant can establish the absence of any of these three elements.

See Montgomery v. Kennedy, 669 S.W.2d 309, 311–12 (Tex. 1984).

      B.     The Law Regarding Giving Notice of Entry of a Judgment

      The Corpus Christi–Edinburg Court of Appeals has set forth the law governing

a clerk’s duty to give the parties notice of a judgment and how a failure to carry out

that duty can become the basis of a bill-of-review proceeding:

      “When the final judgment or other appealable order is signed, the clerk
      of the court shall immediately give notice to the parties or their attorneys
      of record [electronically or] by first-class mail advising that the judgment
      or order was signed.” Tex. R. Civ. P. 306a(3). A bill of review may be
      predicated on a party’s lack of notice of a judgment. See Petro-Chem[.]
      Transp., Inc. v. Carroll, 514 S.W.2d 240, 245 (Tex. 1974); Saint v. Bledsoe,
      416 S.W.3d 98, 106 (Tex. App.—Texarkana 2013, no pet.).

              Due process requires notice “at a meaningful time and in a
      meaningful manner” that would enable a party to be bound by a court’s
      judgment to have an opportunity to be heard. Peralta v. Heights Med. Ctr.,
      Inc., 485 U.S. 80, 86 . . . (1988); accord Univ. of Tex. Med. Sch. v. Than, 901
      S.W.2d 926, 930 (Tex. 1995). “[A] judgment entered without notice or
      service is constitutionally infirm.” Peralta, 485 U.S. at 84; see In re
      Guardianship of Jordan, 348 S.W.3d 401, 405 (Tex. App.—Beaumont 2011,
      no pet.) (“The constitutional right to due process of law restricts the
      ability of a court to render a judgment binding a party without proper

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      notice.”). However, situations in which a party has not been subjected
      to the jurisdiction of the court because there was no service are
      distinguished from a situation in which a party knew the case was
      pending and inadequately protected his or her rights. Bledsoe, 416 S.W.3d
      at 103.

Montalvo v. Vela, No. 13-14-00166-CV, 2016 WL 192063, at *3 (Tex. App.—Corpus

Christi–Edinburg Jan. 14, 2016, no pet.) (mem. op.). “[W]hen a bill-of-review plaintiff

claims a due[-]process violation for no service or notice, it is relieved of proving the

first two elements set out above.” Mabon, 369 S.W.3d at 812. But when a bill-of-

review plaintiff relies on Rule 306a(3), it must still allege a meritorious defense and

that the failure to present such a defense was not caused by any fault or negligence of

its own. Gard v. Douglas Ray Stracener Estate, 631 S.W.3d 728, 733 (Tex. App.—

Texarkana 2021, no pet.).

      C.     Analysis

      Here, we go straight to the third element.           Appellants’ sole argument

concerning this element is that they are “free of negligence in pursuing remedies in

the underlying cause specifically because th[e] lack of notice [of the judgment]

for[e]closed any opportunity to do so.” Even if we take as true that Appellants did

not receive notice of the underlying judgment, we cannot accept Appellants’ argument

that such official mistake makes them immune from proving up the third element. As

explained above, a bill-of-review plaintiff relying on an official mistake under Rule

306a(3) still must prove the third element. See id. Appellants have failed to do this in

their brief’s one-sentence argument that is directed to the failure to receive notice of

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the judgment and not the act that left them exposed to judgment in the underlying

suit—the failure to respond to LCA’s traditional motion for summary judgment.

Appellants make no mention of this failing or argument that it should be excused.

      Appellants also failed to meet this third element in the trial court. First, they

failed to file a response to LCA’s no-evidence motion for summary judgment that

raised negligence of trial counsel in the underlying suit as a ground for summary

judgment.    Second, even if we broadly construe Appellants’ summary-judgment

motions as a response to LCA’s no-evidence summary-judgment motion, Appellants’

motions admit that their trial attorney was negligent: “[LCA] is claiming negligence by

[Appellants] in that[] . . . [Appellants’] attorney received a copy of [LCA’s] motion for

summary judgment and a copy of the notice of the setting. That is true.” Appellants

then go on to use the Craddock3 standard, which is applicable to no-answer default

judgments,4 to argue that “the failure to answer the motion for summary judgment

was not intentional or the result of conscious indifference but was due to mistake or

accident.” An allegation of attorney negligence cannot suffice to support a bill of

review; instead, the attorney’s negligence will be imputed to his clients, making it

impossible for them to succeed on the bill of review. See In re Gypsum Mgmt. & Supply,

Inc., No. 05-04-01545-CV, 2004 WL 2915284, at *2 (Tex. App.—Dallas Dec. 17,

      3
       See Craddock v. Sunshine Bus Lines, Inc., 133 S.W.2d 124, 126 (Tex. [Comm’n
Op.] 1939).
      4
       See Carpenter v. Cimarron Hydrocarbons Corp., 98 S.W.3d 682, 683–84, 686 (Tex.
2002) (op. on reh’g).

                                           8
2004, orig. proceeding) (mem. op.) (first citing Transworld Fin. Servs. Corp. v. Briscoe, 722

S.W.2d 407, 408 (Tex. 1987); and then citing Gracey v. West, 422 S.W.2d 913, 916 (Tex.

1968)). The San Antonio Court of Appeals has illustrated this concept as follows:

       In [real party in interest’s] bill of review, she asserted [that] she [had]
       failed to respond to the [discovery requests and summary-judgment
       motion] due to accident and/or official mistake. Specifically, she relied
       on the affidavit of her former attorney . . . , to the extent that he
       acknowledged that he had neglected the lawsuit. However, “allegations
       of fraud or negligence on the part of a party’s attorney are insufficient to
       support a bill of review.” [King, 118 S.W.3d at 751] (citing Transworld,
       722 S.W.2d at 408) . . . . Therefore, a bill of review in which a petition
       alleges that the wrongful act of their attorney caused an adverse
       judgment is not excused from the necessity of pleading and proving their
       opponent’s extrinsic fraud. King, 118 S.W.3d at 751 (citing Transworld,
       722 S.W.2d at 408).

In re Pollo Gordo, Inc., 373 S.W.3d 107, 110 (Tex. App.—San Antonio 2012, orig.

proceeding). Here, Appellants, while admitting that their trial counsel was negligent,

failed to prove any extrinsic fraud on the part of LCA.

       Applying the applicable standard of review, we hold that there is no evidence

of the third element that Appellants were required to prove for their bill-of-review

proceeding and that the trial court’s granting of LCA’s no-evidence summary-

judgment motion was proper. See Gard, 631 S.W.3d at 734 (holding that because

appellants had knowledge of the trial setting but failed to appear, the trial court did

not abuse its discretion by finding that appellants did not meet the third element

required to sustain a bill of review); Amaya v. Bissell HomeCare, Inc., No. 13-18-00086-

CV, 2020 WL 4382020, at *10 (Tex. App.—Corpus Christi–Edinburg July 30, 2020,

                                             9
no pet.) (mem. op.) (holding that even if it could be construed that appellant met the

first two steps, he “did not present evidence, argument, or authority that his failure to

raise the defense was unmixed with any fault or negligence on his own part”). We

overrule Appellants’ sole issue.5

                                    IV. Conclusion

      Having overruled Appellants’ sole issue, we affirm the trial court’s final

judgment.

                                                      /s/ Dabney Bassel

                                                      Dabney Bassel
                                                      Justice

Delivered: November 16, 2023

      5
       In their reply brief, Appellants object to the supplemental clerk’s record, which
LCA requested and which contains documents from the underlying case that
prompted Appellants’ bill-of-review petition; Appellants’ objection to the
supplemental clerk’s record is moot because we did not consider the items from that
record in disposing of the appeal. See Tex. R. App. P. 47.1.

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