Court Opinion

ID: 3103816
Source: CourtListenerOpinion
Date Created: 2015-10-16 05:31:11.481091+00
Date Added: 2024-06-11T15:46:16.728471
License: Public Domain

Opinion on Rehearing Filed July 12, 2013.

                                            In The
                                      Court of Appeals
                               Fifth District of Texas at Dallas

                                      No. 05-13-00586-CV

              IN RE RADIANT DARKSTAR PRODUCTIONS, LLC, Relator

                        On Appeal from the 134th Judicial District Court
                                     Dallas County, Texas
                             Trial Court Cause No. DC-13-02152

                     MEMORANDUM OPINION ON REHEARING
                        Before Justices FitzGerald, Lang, and Myers
                                 Opinion by Justice Myers
       The Court has before it the parties’ motions for rehearing. We grant the motions in part

and withdraw our opinion and vacate our order of June 25, 2013. The following is now the

opinion of the Court:

       This petition for writ of mandamus challenges two orders signed by the trial court: one

ordering relator to deposit $260,000.00 into the registry of the court, and one denying relator’s

motion to dissolve pre-judgment writs of garnishment and emergency motion to release funds

deposited into the registry of the court. In order to obtain mandamus relief, relator must show

both that the trial court has abused its discretion and that it has no adequate appellate remedy. In

re Prudential Ins. Co., 148 S.W.3d 124, 135-36 (Tex. 2004) (orig. proceeding); Walker v.

Packer, 827 S.W.2d 833, 839-40 (Tex. 1992) (orig. proceeding). Relator has met this burden,

and we therefore conditionally grant the petition.
            Real party in interest Philip B. Sauer obtained a judgment in Pennsylvania and a

judgment in California against a foreign corporation, Valley Games. Sauer domesticated these

judgments in the trial court. In the same action, he filed suit against relator, Valley Games,

Torben Sherwood, and Richard Falch for fraudulent transfer and sought to pierce the corporate

veil. Sauer also obtained an ex parte order for a pre-judgment writ of garnishment of “debts and

assets held by Radiant Gaming for Falch or Sherwood.”1 Finally, Sauer moved to require relator

to deposit $330,000.00 into the court’s registry. The trial court granted that motion in part and

ordered relator to deposit $260,000.00. In response, relator moved to dissolve the writs of

garnishment and to release the funds deposited into the registry of the court. The trial court

denied both motions.

            In its petition, relator argues that the writ of garnishment was wrongfully granted because

Sauer’s claims against it are contingent and unliquidated, and that the requirement to deposit

money into the court’s registry constitutes injunctive relief to which Sauer is not entitled. In

response, Sauer argues that the court had discretion to order the writ and the deposit because

Valley Games has fraudulently transferred assets to relator in an attempt to avoid the judgments

against it. Even if Sauer is correct, the trial court abused its discretion in ordering the writ and

the deposit.

A plaintiff is entitled to a writ of garnishment if:

            (1) an original attachment has been issued;

            (2) a plaintiff sues for a debt and makes an affidavit stating that:

                 (A) the debt is just, due, and unpaid;

                 (B) within the plaintiff’s knowledge, the defendant does not possess property
                     in Texas subject to execution sufficient to satisfy the debt; and

    1
        Sauer also obtained additional writs of garnishment and a writ of attachment, which are not at issue in this petition.

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           (C) the garnishment is not sought to injure the defendant or the garnishee; or

       (3) a plaintiff has a valid, subsisting judgment and makes an affidavit stating that,
           within the plaintiff’s knowledge, the defendant does not possess property in
           Texas subject to execution sufficient to satisfy the judgment.

TEX. CIV. PRAC. & REM. CODE ANN. § 63.001(West 2008). “A writ of garnishment may be

issued only when the demand is not contingent, is capable of ascertainment by the usual means

of evidence, and does not rest in the discretion of the jury.” In re Tex. Am. Express, Inc., 190
S.W.3d 720, 725 (Tex. App.—Dallas 2005, orig. proceeding) (Lang, J.).             For that reason,

prejudgment writs of garnishment are generally not available for the tort of fraudulent transfer or

on a theory of piercing the corporate veil. Id. We find the analysis of In re Texas American

Express applicable to this case; accordingly, it was error for the trial court to order the writ of

garnishment. Similarly, requiring relator to deposit money into the court’s registry is a form of

mandatory injunction. The record does not demonstrate that Sauer ever filed a motion for

temporary injunction, let alone that he proved his entitlement to one. This order, too, was an

abuse of discretion.

       Because relator has no adequate remedy at law for the trial court’s error, see id. at 727,

we conditionally grant the petition for writ of mandamus. The writ will issue only if the trial

court fails to vacate its April 4, 2013 “Order Overruling Defendant Radiant’s Motion to Dissolve

Pre-Judgment Garnishments and Emergency Motion” and to render an order granting the motion

to dissolve the pre-judgment garnishment of debts and assets held by Radiant Gaming for Falch

or Sherwood and the motion to release funds deposited by relator into the registry of the court.

                                                     /Lana Myers/
130586HF.P05                                         LANA MYERS
                                                     JUSTICE

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