Court Opinion

ID: 6496128
Source: CourtListenerOpinion
Date Created: 2022-06-29 06:12:08.006368+00
Date Added: 2024-06-11T08:48:35.253016
License: Public Domain

REVERSE and RENDER in part; REMAND and Opinion Filed June 22, 2022

                                     S  In The
                             Court of Appeals
                      Fifth District of Texas at Dallas
                                No. 05-21-00545-CV

            MAJGEK PARTNERS, LLC, Appellant
                           V.
MO AND ASSOCIATE, LLC AND JIMMY AND SUSAN MONTGOMERY,
                        Appellees

                On Appeal from the 401st Judicial District Court
                             Collin County, Texas
                    Trial Court Cause No. 401-00310-2019

                        MEMORANDUM OPINION
                   Before Justices Molberg, Reichek, and Garcia
                            Opinion by Justice Reichek
      In this appeal from a summary judgment, Majgek Partners, LLC (“Majgek”)

contends the trial court erred in concluding it did not meet its burden to sustain a bill

of review. Because the undisputed facts show that Majgek was never served with

process in the underlying suit, we reverse the trial court’s judgment, render summary

judgment in favor of Majgek on the issue of entitlement to bring a bill of review,

and remand the case for further proceedings.
                                   Background

      The following facts, as found by the trial court, are undisputed. Majgek is a

Texas limited liability company. On September 16, 2015, the Collin County taxing

authorities filed suit against Majgek seeking to recover delinquent property taxes,

penalties, and interest. Citation was issued and sent by mail to Majgek’s registered

agent for service. At that time, Majgek’s registered agent was no longer at the

address listed with the Texas Secretary of State. The envelope containing the

citation and petition was subsequently returned marked “Not Deliverable as

Addressed, Unable to Forward.”

      The taxing authorities did not serve the Texas Secretary of State as Majgek’s

deemed agent for service. Nor did they seek to serve Majgek through citation by

publication. Instead, the authorities requested service on Majgek through citation

by posting pursuant to Texas Rule of Civil Procedure 177a. The affidavit filed in

support of service by posting failed to state either that the requirements for due

diligence had been met, or that citation by publication was too expensive. Despite

this, the citation was posted in the Collin County courthouse on June 10, 2016.

      On April 5, 2017, judgment was rendered against Majgek without Majgek

having answered or appeared. Six months later, the real property that was the subject

of the tax suit was sold by a Collin County constable to Mo and Associate, LLC

(“Mo”). The same property was later sold by Mo to Jimmy and Susan Montgomery.

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      On January 17, 2019, Majgek filed this suit for equitable bill of review seeking

to regain possession of the property and quiet title. Mo and the Montgomerys

answered and filed motions for traditional summary judgment contending Majgek

could not bring a bill of review because it “was not free from fault or negligence in

letting judgment be taken.” Majgek responded and filed a cross-motion for summary

judgment arguing the evidence showed it was never served with process, which

negated the element of negligence as a matter of law.

      On March 31, 2021, the trial court issued a “Memorandum Opinion on Cross-

Motions for Summary Judgment.” In the opinion, the court held the affidavit in

support of citation by posting was deficient on its face. The court further held that

Majgek was never served with process and the “minimum requirements of due

process did not occur.” The court went on to conclude, however, that Majgek could

not sustain its bill of review because it was negligent in failing to update the address

for its registered agent for service of process with the Texas Secretary of State.

Accordingly, the trial court granted the motions for summary judgment filed by Mo

and the Montgomerys, and denied Majgek’s motion for summary judgment. This

appeal followed.

                                       Analysis

      In its first two issues, Majgek contends the trial court erred in denying its

motion for summary judgment, and in granting summary judgment in favor of Mo

and the Montgomerys, on the basis that Majgek failed to show it was not at fault or

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negligent in connection with the tax judgment rendered against it. Majgek argues

the undisputed evidence showing it was never served with process, and that it did

not appear in the underlying suit, was sufficient to sustain its burden as a matter of

law. We agree.

      We review a trial court’s ruling on a motion for summary judgment de novo.

Tarr v. Timberwood Park Owners Ass’n, Inc., 556 S.W.3d 274, 278 (Tex. 2018). To

prevail on a traditional motion for summary judgment, the movant must show there

are no genuine issues of material fact and it is entitled to judgment as a matter of

law. Id. When competing motions for summary judgment are filed, and the trial

court grants one motion and denies the other, we determine all issues presented and

render the judgment the trial court should have rendered. Id.

      In this case, the pivotal issue addressed by both motions for summary

judgment is the applicability of the Texas Supreme Court’s opinion in Caldwell v.

Barnes, 154 S.W.3d 93 (Tex. 2004) (“Caldwell II”). In Caldwell II, the supreme

court discussed the burden of proof for bill of review plaintiffs alleging non-service.

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 new trial or

direct appeal. Id. at 96. Generally, a bill of review plaintiff must plead and prove

(1) a meritorious defense to the underlying cause of action, (2) which it 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 their own part. Id.

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A bill of review plaintiff alleging non-service is relieved of the burden of making a

showing on the first two elements. Id. at 96–97.

      As for the third element, conclusive proof that there was no service of process

will establish that the judgment being challenged was rendered without any fault or

negligence on the part of the plaintiff. Id. at 97. This is because “[a]n individual

who is not served with process cannot be at fault or negligent in allowing a default

judgment to be rendered.” Id.

      In its memorandum opinion, the trial court in this case focused on the supreme

court’s use of the word “individual” in the sentence quoted above to conclude that

Caldwell II did not apply to entities that are required to maintain registered agents

for service of process with the secretary of state. The court reasoned that, because

individuals have no legal obligation to provide an address for service of process,

entities could be negligent in a way that individuals could not. The flaw in this

reasoning is that the real issue with non-service is not an absence of negligence, but

an absence of jurisdiction. See Mitchell v. MAP Res., Inc., 21-0124, 2022 WL

1509745, at *9–10 (Tex. May 13, 2022); see also Wilson v. Dunn, 800 S.W.2d 833,

836 (Tex. 1990).

      The reason a defendant cannot be negligent when it has not been served with

process is that, absent service, waiver of service, or citation, the jurisdiction of the

trial court has not been invoked and the defendant has no duty to act. See Caldwell

II, 154 S.W.3d at 97 n. 1; Wilson, 800 S.W.2d. at 837. The jurisdiction of the trial

                                          –5–
court to render judgment is dependent upon citation issued and served in a manner

provided by law. Wilson, 800 S.W.2d. at 836. “A complete failure of service

deprives a litigant of due process and a trial court of personal jurisdiction; the

resulting judgment is void and may be challenged at any time.” In re E.R., 385

S.W.3d 552, 566 (Tex. 2012); see also Lytle v. Cunningham, 261 S.W.3d 837, 840

(Tex. App.—Dallas 2008, no pet.) (when attempted service is invalid, trial court

acquires no personal jurisdiction over defendant and default judgment is void).

      The requirement of invoking jurisdiction through valid service is as applicable

to entities as it is to individuals. See U.S. Bank Nat’l Ass’n v. Moss, 644 S.W.3d

130, 137 (Tex. 2022); Lytle, 261 S.W.3d at 840–41. This Court and others have

applied Caldwell II to entities that are required to maintain registered agents for

service of process. See, e.g., Bank of N.Y. Mellon v. FFGGP, Inc., No. 05-20-00384-

CV, 2022 WL 732079, at *2 (Tex. App.—Dallas March 11, 2022, no pet.) (mem.

op.). Because the undisputed evidence shows Majgek was never served with

process, we conclude it showed its entitlement to bring a bill of review as a matter

of law.

      Based on the foregoing, we reverse the trial court’s judgment, grant Majgek’s

motion for summary judgment on the issue of entitlement to bring a bill of review,

and remand the case for further proceedings.

                                        –6–
      Because of our resolution of Majgek’s first two issues, we need not address

its remaining issues.

                                         /Amanda L. Reichek/
                                         AMANDA L. REICHEK
                                         JUSTICE

210545F.P05

                                      –7–
                                    S
                            Court of Appeals
                     Fifth District of Texas at Dallas
                                   JUDGMENT

MAJGEK PARTNERS, LLC,                          On Appeal from the 401st Judicial
Appellant                                      District Court, Collin County, Texas
                                               Trial Court Cause No. 401-00310-
No. 05-21-00545-CV           V.                2019.
                                               Opinion delivered by Justice
MO AND ASSOCIATES, LLC AND                     Reichek. Justices Molberg and
JIMMY AND SUSAN                                Garcia participating.
MONTGOMERY, Appellees

       In accordance with this Court’s opinion of this date, the judgment of the trial
court is REVERSED and judgment is RENDERED that:

       Majgek Partners, LLC's motion for summary judgment on the issue of
entitlement to bring a bill of review is GRANTED.

       We REMAND the case to the trial court for further proceedings consistent
with this opinion.

       It is ORDERED that appellant MAJGEK PARTNERS, LLC recover its
costs of this appeal from appellees MO AND ASSOCIATES, LLC AND JIMMY
AND SUSAN MONTGOMERY.

Judgment entered June 22, 2022

                                         –8–