Court Opinion

ID: 3120462
Source: CourtListenerOpinion
Date Created: 2015-10-16 08:40:25.906867+00
Date Added: 2024-06-11T11:53:05.076350
License: Public Domain

Opinion issued November 1, 2012.

                                    In The

                             Court of Appeals
                                   For The

                         First District of Texas
                          ———————————
                            NO. 01-09-00493-CV
                          ———————————
                       ALBERT MORRIS, Appellant
                                      V.
                         LISA COFFMAN, Appellee

                  On Appeal from the 234th District Court
                           Harris County, Texas
                     Trial Court Case No. 2007-05915

               MEMORANDUM OPINION ON REHEARING

      Appellant Albert Morris has filed a motion for en banc reconsideration of

our August 9, 2012 opinion. In light of the motion, we withdraw our opinion and

judgment of August 9, 2012, and we issue this opinion in its stead. We overrule

the motion for reconsideration en banc as moot. See Brookshire Bros., Inc. v.
Smith, 176 S.W.3d 30, 33 (Tex. App.—Houston [1st Dist.] 2004, pet. denied) (op.

on reh’g) (motion for en banc reconsideration becomes moot when panel issues

new opinion and judgment).

      Morris appeals the trial court’s judgment awarding $6,396.91 in disgorged

attorney’s fees to Lisa Coffman. Coffman sued Morris, an attorney, for fraud in

connection with his representation of her in a civil suit against her employer. After

a bench trial, the trial court awarded damages to Coffman and issued findings of

fact and conclusions of law in support of its judgment. In three issues, Morris

contends that Coffman’s suit was barred by limitations, Coffman failed to offer any

admissible evidence to support her claim for fraud, and that the trial court erred by

granting a new trial to Coffman after initially granting Morris’s motion for

summary judgment. Morris also asserted in his reply to Coffman’s brief that the

trial court lacked jurisdiction over this suit. In her own appeal, Coffman contends

that evidence is insufficient to support the award of $6,396.91, because the

evidence conclusively proves damages in the amount of $15,997.27. We affirm.

                                   Background

      Coffman was terminated by her employer, the United States Postal Service,

in 2001. She filed suit pro se in federal court, alleging wrongful termination.

Coffman later retained Morris to represent her. It is undisputed that Morris and

                                         2
Coffman agreed that Morris would be compensated through a contingent fee in an

amount equal to forty percent of Coffman’s recovery.

      In late 2001, Morris negotiated a settlement that included a cash payment of

$47,500 and re-employment. For the purpose of calculating Morris’s fee, only the

cash payment was considered part of Coffman’s recovery. Accordingly, Morris

received $19,000 and Coffman received $28,500. The entire $47,500 was reported

to the Internal Revenue Service as income for Coffman. She, however, did not pay

taxes on any portion of the settlement. Some time later, the IRS charged Coffman

for unpaid taxes on the full amount of $47,500.00, or $15,992.27.

      In January 2007, Coffman sued Morris, asserting violations of the DTPA,

fraud, fraudulent inducement, breach of warranty, and breach of fiduciary duty.

The primary factual basis of Coffman’s suit was her allegation that Morris told her

that no tax would be due on the settlement, but, if there was, he would be

responsible for taking care of the tax. Morris defended, in part, on the grounds that

limitations had run on Coffman’s claims before she filed suit.

      After a bench trial, the trial court rendered judgment for Coffman in the

amount of $6,396.91 and issued findings of fact and conclusions of law. Among

the findings and conclusions most pertinent to this appeal were the following:

      • Plaintiff [Coffman] asked Defendant [Morris] multiple times when
      entering the final settlement agreement in 2001 whether Plaintiff had
      to pay taxes on the settlement. Defendant told Plaintiff that she did

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      not have to pay taxes because the payment was in the nature of a
      settlement, which carried no tax liability.

      • The Court finds that there is no evidence that Plaintiff knew or
      should have known of her tax liability for the settlement amount prior
      to the IRS’s proposed change to her 2001 Income Tax Return in June
      2003. Regarding Defendant’s limitations defense, Defendant put on
      no evidence at trial demonstrating that Plaintiff knew or should have
      known about her tax liability before that time (if he did, then such
      evidence amounted to legally insufficient evidence).

      • However, Plaintiff produced no evidence at trial that she suffered an
      injury as a result of the misrepresentation. There is no evidence
      demonstrating Plaintiff’s damages. There is no evidence that Plaintiff
      would have received more had she not entered into the Agreement.
      No evidence was produced at trial that Plaintiff would have recovered
      more value or money had she gone to trial for the underlying
      employment dispute. There is no evidence of what Plaintiff would
      have done differently had she known the truth, or what different result
      would have occurred. Moreover, neither Defendant nor his false
      statement caused Plaintiff’s tax liability—the United States Tax Code
      caused Plaintiff’s liability. There is no “but-for” causation regarding
      Defendant’s false statement and the taxability of the settlement, or any
      other damages— that is, if Defendant had not made his representation
      of no tax liability, Plaintiff’s settlement would still have been taxable.
      The Court, therefore, concludes that Plaintiff is not entitled to actual
      damages for her fraud claim.

The trial court nevertheless found that Morris breached his fiduciary duty to

Coffman and should disgorge his attorney’s fees in the amount of $6,396.91, which

was the tax payable on his forty percent of the $47,500.

                                    Jurisdiction

      In his reply to Coffman’s appellant’s brief and in his motion for en banc

reconsideration, Morris contends that the trial court lacked jurisdiction. Morris

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asserts that Coffman’s suit was an attempt “to set aside a federal court’s judgment”

and argues that suit is therefore barred by the Full Faith and Credit Clause of the

United States Constitution. See U.S. CONST. art. IV, § 1.

        First, we note that Morris has cited no authority for the proposition that a

prior federal judgment is a jurisdictional bar to bringing a suit. A prior judgment

entitled to full faith and credit may raise other problems with maintaining the

suit—for example, res judicata. Res judicata, however, is not a jurisdictional bar.

Williams v. Houston Firemen’s Relief & Ret. Fund, 121 S.W.3d 415, 437 n.21

(Tex. App.—Houston [1st Dist.] 2003, no pet.) (“[R]es judicata is an affirmative

defense on the merits, not a jurisdictional bar.”); see also Tex. Highway Dep’t v.

Jarrell, 418 S.W.2d 486, 488 (Tex. 1967) (“We observe that a plea of res judicata

is not a plea in abatement or a plea to the jurisdiction, but is a plea in bar.”).

      Second, Coffman’s petition, Morris’s answer, the trial court’s findings of

fact and conclusions of law, the trial court’s judgment, and the parties’ briefing to

this court uniformly indicate that Coffman was suing based on an agreement

between herself and Morris, Morris’s misrepresentations, and Morris’s breach of

fiduciary duty. That is, nothing in the record indicates Coffman was attempting to

set aside a federal court judgment. In fact, there is no federal court judgment in the

record. With his motion for en banc reconsideration, Morris provided a copy of

                                            5
Coffman’s affidavit, which had been submitted in the trial court.1 Attached to that

affidavit is the settlement agreement that ended the federal court litigation, signed

by Coffman, her counsel Morris, and the U.S. Attorney representing the U.S Postal

Service. The settlement agreement is not a judgment. It is not signed by the

federal judge nor does the plain language reflect that it is anything other than a

settlement agreement. Because neither the law nor the evidence supports Morris’s

jurisdictional argument, we hold that the trial court did not lack jurisdiction.

      We overrule Morris’s jurisdictional argument.

                               Statute of Limitations

      In his first issue, Morris contends that Coffman’s claims are all barred by the

statute of limitations. Specifically, he asserts that Coffman should have known

that she was responsible for paying income tax on the settlement no later than

April 15, 2002, when the IRS seized her refund for past due taxes on the settlement

proceeds. Coffman, however, did not file her suit until January 31, 2007, which,

Morris argues, is beyond the limitations period.

      The trial court made specific findings of fact and conclusions of law

concerning limitations and the applicability of the “discovery rule.” It found there

1
      We note that, although this submission was not part of the appellate record, we
      may consider it for the purposes of determining this court’s jurisdiction. Sabine
      Offshore Serv., Inc. v. City of Port Arthur, 595 S.W.2d 840, 841 (Tex. 1979)
      (“Affidavits outside the record cannot be considered by the Court of Civil Appeals
      for any purpose other than determining its own jurisdiction.”).
                                           6
was no evidence that Coffman “knew or should have known of her tax liability for

the settlement amount prior to the IRS’s proposed change to her 2001 Income Tax

Return in June 2003.” In this appeal, Morris contends that the evidence shows

Coffman knew or should have known that her taxes were due no later than April

15, 2002. However, Morris has not supplied this court with a reporter’s record to

review the evidence.

      An appellant bears the burden to bring forward a record from the trial court

that enables this court to determine whether appellant’s complaints constitute

reversible error. See Enter. Leasing Co. of Houston v. Barrios, 156 S.W.3d 547,

549 (Tex. 2004) (per curiam); Christiansen v. Prezelski, 782 S.W.2d 842, 843

(Tex. 1990) (stating that burden is on appellant to present sufficient record to show

error requiring reversal); Mallios v. Standard Ins. Co., 237 S.W.3d 778, 781 (Tex.

App.—Houston [14th Dist.] 2007, pet. denied). If the appellant fails to bring

forward a complete record, the court will presume the missing part of the record

supports the trial court’s judgment. Mallios, 237 S.W.3d at 781 (citing Barrios,
156 S.W.3d at 550). Because Morris has not brought forward an evidentiary

record2 from which this court could review the trial court’s findings and

2
      On April 24, 2012, this court issued an order setting forth the more than three-year
      history of this appeal, including the fact that Morris was informed as early as June
      12, 2009, that no reporter’s record had been requested or paid for. In the April
      24th order, this court specifically informed the parties, “The record reflects that no
      party has ever paid for or made arrangements to pay for the reporter’s record.
                                            7
conclusions concerning limitations and the discovery rule, we must presume the

missing portions of the record support the trial court’s judgment. See Barrios, 156
S.W.3d at 550; Mallios, 237 S.W.3d at 781.

      We overrule Morris’s first issue.

                             Sufficiency of the Evidence

      In his second issue, Morris asserts there was no evidence to support the

judgment because Coffman did not prove one or more of the elements of each of

her causes of action. As discussed above, Morris has not presented this court with

the reporter’s record. We therefore must presume that the missing portions of the

record support the trial court’s judgment.          See Barrios, 156 S.W.3d at 550;

Mallios, 237 S.W.3d at 781.

      We overrule Morris’s second issue.

                           Granting Motion for New Trial

      In his third issue, Morris contends that the trial court “abused it’s [sic]

authority in re-opening the case” after it had already granted Morris’s motion for

summary judgment. The Texas Supreme Court has held that, except in two limited

      Therefore, the Court will consider and decide those issues or points that do not
      require a reporter’s record for a decision. See TEX R. APP. P. 37(c).” Morris has
      contended that the record was to be provided to him free of all costs, per the
      court’s finding of indigence. However, as set forth in this court’s April 24th order,
      the trial court sustained the contest to Morris’s affidavit of indigency that was filed
      by the court reporter but overruled the contest that was filed by the district clerk.
      Therefore, while Morris was entitled to a free clerk’s record, he was responsible
      for paying for the reporter’s record.
                                             8
circumstances not applicable here, “an order granting a motion for new trial

rendered within the period of the trial court’s plenary power is not reviewable on

appeal.” Wilkins v. Methodist Health Care Sys., 160 S.W.3d 559, 563 (Tex. 2005)

(explaining that Johnson v. Fourth Court of Appeals, 700 S.W.2d 916, 918 (Tex.

1985), noted two instances when a Texas appellate court has overturned a trial

court’s grant of a new trial: (1) when the trial court’s order was wholly void, and

(2) where the trial court specified in the written order that the sole ground for

granting the motion was that the jury’s answers to special issues were

irreconcilably conflicting). Here, there is no indication that the trial court’s order

was void and, because it was a summary judgment proceeding, there were no jury

answers that could possibly conflict. See id. Therefore, the order granting a new

trial was interlocutory and not reviewable on appeal. See id.

      We overrule Morris’s third issue.

                                Coffman’s Appeal

      In a single issue, Coffman complains that the trial court erred by failing to

award her $15,997.27 in attorney’s fees because the evidence conclusively

established that she was damaged in that amount. She also contends that the trial

court’s finding that there was no evidence of causation is in error. However, just

as in Morris’s appeal, Coffman’s challenges to the evidence supporting the trial

court’s findings fail because she has not presented this court with the evidentiary

                                          9
record. In that circumstance, we must presume the reporter’s record contains

evidence that support’s the trial court’s judgment. See Mallios, 237 S.W.3d at 781;

Barrios, 156 S.W.3d at 550.

      We overrule Coffman’s sole issue.

                                   Conclusion

      We affirm the judgment of the trial court.

                                             Rebeca Huddle
                                             Justice

Panel consists of Justices Higley, Sharp, and Huddle.

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