Court Opinion

ID: 4674379
Source: CourtListenerOpinion
Date Created: 2021-04-05 07:13:24.150651+00
Date Added: 2024-06-11T08:03:20.234901
License: Public Domain

In the
               Court of Appeals
       Second Appellate District of Texas
                at Fort Worth
            ___________________________
                 No. 02-20-00301-CV
            ___________________________

HWAT, INC., INDIVIDUALLY AND D/B/A HOME WARRANTY
              ADMINISTRATORS, Appellant

                             V.

               EDDIE AGNEW, Appellee

        On Appeal from County Court at Law No. 2
                 Tarrant County, Texas
             Trial Court No. 2019-006741-2

        Before Sudderth, C.J.; Bassel and Walker, JJ.
         Memorandum Opinion by Justice Bassel
                           MEMORANDUM OPINION

                                  I. Introduction

      In this restricted appeal, Appellant HWAT, Inc., individually and d/b/a Home

Warranty Administrators, brings a single issue challenging the no-answer default

judgment obtained by Appellee Eddie Agnew. We sustain HWAT’s argument that

there is error on the face of the record because the certified-mail receipt showing

service of citation on HWAT’s corporate registered agent does not show that the

individual who signed the receipt has a connection to the corporate registered agent.

This deficiency in the proof of service is dispositive of this appeal, and we do not

reach HWAT’s other attacks on the proof of service.          However, in addressing

HWAT’s service-defect complaint, Agnew asks us to consider evidence outside the

appellate record as proof that HWAT had notice of the suit and that there is a

connection between the person who signed the certified-mail receipt and the

corporate registered agent. We cannot consider matters outside the appellate record

before us, and even if we could, the fact that HWAT had actual notice of the suit does

not remedy a defect in service that is apparent on the face of the record. We reverse

the trial court’s judgment and remand this case to the trial court for a new trial

consistent with this opinion.

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                                   II. Background

      Agnew sued HWAT alleging that HWAT had committed various deceptive

trade practices in the handling of a home-warranty claim. The service-of-process

allegations in Agnew’s petition were as follows:

      Defendant, HWAT, INC., Individually and d/b/a HOME
      WARRANTY ADMINISTRATORS, is a Texas corporation doing
      business in the State of Texas and may be served with citation by and
      through their registered agent for service, REGISTERED AGENT
      SOLUTIONS, INC., at 1701 Directors Blvd., Suite 300[,] Austin, Texas
      78744.

      HWAT did not answer, and Agnew filed a motion for default judgment, which

alleged that HWAT had been served with process. A copy of the citation and a copy

of the return of service, both of which were allegedly served on HWAT, were

attached as exhibits to the motion. The following is a facsimile of the citation:

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      The return of service referenced a certified-mail receipt with a particular

identifying number. A certified-mail receipt bearing that number was attached as an

exhibit to the motion, and the following is a facsimile of that exhibit:

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      The trial court entered both an interlocutory and a final default judgment. The

interlocutory default judgment recited that HWAT, “although duly and legally cited to

according to law to answer herein, failed to appear and wholly made default.” The

interlocutory default judgment went on to recite that “[t]he citation, with the officer’s

return thereon, has been on file with the clerk of this court for the ten (10) days

required by law, exclusive of the day of filing and of this day, and [Agnew] is entitled

to a default judgment on his claim against [HWAT].”

      HWAT subsequently filed a notice of restricted appeal. 1

      1
       On the same date that it filed its notice of appeal, HWAT filed with this court
a “Motion to Extend Time to File Notice of Appeal.” We granted the motion; and
our order recited that HWAT’s notice of appeal was timely.

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                                      III. Analysis

      A.     We set forth the standards governing a restricted appeal and what
             constitutes the face of the record to determine whether process
             was properly served.

      A restricted appeal in a civil case is governed by Texas Rule of Appellate

Procedure 30, which provides that

      [a] party who did not participate—either in person or through counsel—
      in the hearing that resulted in the judgment complained of and who did
      not timely file a postjudgment motion or request for findings of fact and
      conclusions of law, or a notice of appeal within the time permitted by
      Rule 26.1(a), may file a notice of appeal within the time permitted by
      Rule 26.1(c). Restricted appeals replace writ of error appeals to the court
      of appeals. Statutes pertaining to writ of error appeals to the court of
      appeals apply equally to restricted appeals.

Tex. R. App. P. 30. The Texas Supreme Court itemized the particulars that a party

must establish to prevail on a restricted appeal as follows:

      (1) she filed notice of the restricted appeal within six months after the
      judgment was signed; (2) she was a party to the underlying lawsuit; (3)
      she did not participate in the hearing that resulted in the judgment
      complained of[] and did not timely file any post-judgment motions or
      requests for findings of fact and conclusions of law; and (4) error is
      apparent on the face of the record.

Pike-Grant v. Grant, 447 S.W.3d 884, 886 (Tex. 2014).

      “In a restricted appeal, the face of the record consists of all papers on file in the

appeal, including any reporter’s record, along with all papers on file with the trial court

at the time the judgment was entered.” McCoy v. McCoy, No. 02-17-00275-CV, 2018

WL 5993547, at *2 (Tex. App.—Fort Worth Nov. 15, 2018, no pet.) (mem. op.)

(citing Norman Commc’ns v. Tex. Eastman Co., 955 S.W.2d 269, 270 (Tex. 1997)). On

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the question of service, the return of service is prima facie evidence of the facts

recited in it; thus, “[i]n a restricted appeal, defective service of process constitutes

error apparent on the face of the record.” Reed Elsevier, Inc. v. Carrollton–Farmers Branch

Indep. Sch. Dist., 180 S.W.3d 903, 905 (Tex. App.—Dallas 2005, pets. denied).

      B.     We set forth the rules governing service when process is served on
             a party’s corporate registered agent by certified mail.

      The following statutes and rules establish that a corporation may utilize another

corporation as its registered agent for service, that service on the corporate registered

agent may be performed by a private process server by certified mail, and what must

be shown to establish that service on a corporate registered agent was valid:

   • A corporation must “designate and continuously maintain in this state . . . a
     registered agent.” Tex. Bus. Orgs. Code Ann. § 5.201(a)(1).

   • For a corporation, a registered agent acts as “an agent of the entity on whom
     may be served any process, notice, or demand required or permitted by law to
     be served on the entity.” Id. § 5.201(b)(1).

   • One of a registered agent’s duties is to “receive or accept, and forward to the
     represented entity at the address most recently provided to the registered agent
     by the represented entity, or otherwise notify the represented entity at that
     address regarding, any process, notice, or demand that is served on or received
     by the registered agent.” Id. § 5.206(a)(1).

   • The registered agent of a corporation may be an individual or an organization.
     Id.; see Reed Elsevier, 180 S.W.3d at 905 (“A corporation may act as the registered
     agent for another domestic or foreign corporation.”).

   • “A registered agent that is an organization must have an employee available at
     the registered office during normal business hours to receive service of process,
     notice, or demand. Any employee of the organization may receive service at
     the registered office.” Tex. Bus. Orgs. Code Ann. § 5.201(d); see Asset Prot. &
     Sec. Servs., L.P. v. Armijo, 570 S.W.3d 377, 383 (Tex. App.—El Paso 2019, no

                                            7
      pet.) (“By statute, a corporation that acts as an agent of service must have an
      employee at its designated address available to accept the process.”).

   • Service of citation may be by certified mail. Tex. R. Civ. P. 106.

   • Service may be made by a private process server. Tex. R. Civ. P. 103.

   • “When the citation [is] served by registered or certified mail as authorized by
     Rule 106, the return by the officer or authorized person must also contain the
     return receipt with the addressee’s signature.” Tex. R. Civ. P. 107(c).

   • “Rule 107 requires a showing of the connection between the person signing for
     the process and the actual addressee.” Asset Prot. & Sec. Servs., 570 S.W.3d at
     383.

      C.     For a default judgment to stand, there must be strict compliance
             with the requirements for service of process.

      When dealing with a no-answer default judgment, the Texas Supreme Court

recently stated how strictly it views the requirement of proper service of process:

      We have long held that a no-answer default judgment cannot stand when
      the defendant “was not served in strict compliance with applicable
      requirements.” Wilson v. Dunn, 800 S.W.2d 833, 836 (Tex. 1990).
      Because no-answer default judgments are disfavored, Holt Atherton Indus.,
      Inc. v. Heine, 835 S.W.2d 80, 86 (Tex. 1992), and because trial courts lack
      jurisdiction over a defendant who was not properly served with process,
      Wilson, 800 S.W.2d at 836, we have construed “strict compliance” to
      mean just that. We indulge no presumptions in favor of valid issuance,
      service, or return of citation. See Uvalde Country Club v. Martin Linen
      Supply Co., 690 S.W.2d 884, 885 (Tex. 1985); McKanna v. Edgar, 388
      S.W.2d 927, 929 (Tex. 1965). Service of process that does not strictly
      comply with the rules’ requirements is “invalid and of no effect.” Uvalde,
      690 S.W.2d at 885 (citing McKanna, 388 S.W.2d at 929).

Spanton v. Bellah, 612 S.W.3d 314, 316–17 (Tex. 2020).

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      D.     Service by certified mail requires a showing that the person
             signing the certified-mail receipt was an agent of the corporate
             registered agent receiving process.

      As noted above, when service is effected by certified mail, there must be proof

of a connection between the individual receiving the citation and the entity to which

the citation is addressed. The El Paso Court of Appeals cataloged the cases holding

that there is not proof of the necessary connection when a certified-mail receipt or

“green card” does not identify the relationship between the person signing the card

and a corporate registered agent:

      [W]here the “green card” section identified a signatory but failed to
      identify the signatory’s relationship to the registered agent[, there is not a
      showing of the connection between the person signing for the process
      and the actual addressee]. Ny-Mac Enter[s.], Inc. v. Orr, [No.] 06-18-
      00005-CV, 2018 WL 2436350, at *2 (Tex. App.—Texarkana May 31,
      2018, no pet.) (mem. op.) (“The green card, although reflecting delivery
      to the address for InCorp Services, Inc., was signed by Jason Casey with
      no indication of Casey’s capacity to accept the service. Where, as here,
      both the ‘Agent’ and ‘Addressee’ boxes were left unchecked on the green
      card, the record does not indicate Casey’s connection, if any, with
      InCorp Services, Inc.”); Paving & Seal Pro v. McConnell Cars & RV, LLC,
      [No.] 04-16-00518-CV, 2017 WL 2350973, at *2 (Tex. App.—San
      Antonio May 31, 2017, no pet.) (mem. op.) (“In this case, both return
      receipts were signed by ‘L. Palmer’ and included her printed name as
      ‘Lisa Palmer.’ However, the face of the record does not identify Lisa
      Palmer or her status or affiliation, if any, with either Brooks or PSP.”);
      MYRMAC Corp. v. P.H., [No.] 02-16-00319-CV, 2017 WL 1173841, at
      *2 (Tex. App.—Fort Worth Mar. 30, 2017, no pet.) (mem. op.) (“As we
      previously recognized, the return receipt, which reflected the
      Weatherford address for McDonalds and its agent, was signed by Irma
      Medina. The record contains no information regarding who Irma
      Medina is or whether she was an authorized agent of the addressee for
      service of process.”); Alamo Home Fin., Inc. v. Duran, [No.] 13-14-00462-
      CV, 2015 WL 4381091, at *5 (Tex. App.—Corpus Christi[–Edinburg]
      July 16, 2015, no pet.) (mem op.) (“In addition, the return of receipt is
      signed, illegibly, by a Veronica Cordell. Both the ‘agent’ and ‘addressee’
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       boxes are left unchecked. Nowhere in the record is there any indication
       as to what connection Cordell has to Alamo. The record, on its face,
       shows that the return was not signed by the addressee or agent.”).

Asset Prot. & Sec. Servs., 570 S.W.3d at 383–84. A green card’s failure to connect the

person signing the green card with the entity being served makes service defective on

its face. See id. at 384 (citing Master Capital Solutions Corp. v. Araujo, 456 S.W.3d 636,

639–40 (Tex. App.—El Paso 2015, no pet.), for proposition that because there was no

showing in the record that the person who signed for the certified mailing was

authorized to do so, the face of the record failed to show strict compliance with the

rules of service).

       E.     There is no controversy that HWAT has met three of the four
              requirements needed to prevail in a restricted appeal; the only
              controverted requirement is whether HWAT established that the
              proof of service on it was fatally defective. We conclude that the
              face of the record establishes proof of service was fatally defective.

       Agnew makes no argument that HWAT has failed to establish three of the four

grounds required to obtain relief in a restricted appeal. Specifically, there is no

controversy that HWAT (1) timely filed its appeal, (2) was a party to the underlying

suit, and (3) did not participate in the hearing that resulted in the judgment

complained of or seek any postjudgment relief. Thus, the focus of the controversy is

on the issue of whether there is some error on the face of the record. There is such

an error because Agnew’s proof of service of his suit on HWAT is lacking.

       The green card that allegedly documented receipt of the citation by HWAT’s

corporate registered agent fails to show that the individual who received the citation

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was an agent of the registered agent. As the facsimile of the card that we incorporated

into this opinion shows, the person who signed the card did not check any of the

boxes next to the signature to document that the person was the addressee or the

addressee’s agent. Under the holding of Asset Protection and the strict requirements of

the rules of service to uphold a no-answer default judgment, that deficiency is an error

on the face of the record.

      Agnew disagrees with our assessment and argues that the signatory’s

connection to the addressee is shown. He does show a connection, just not a relevant

one. He points out that the citation—not the green card—lists the name of HWAT’s

corporate registered agent and has “Registered Agent” circled in the accompanying

printed description that gives the options of designating the person or entity served as

“President, Vice-President, Registered Agent.” But the connection of the corporate

registered agent being the agent of HWAT is not the one that is lacking. The green

card fails to establish the connection between the person who signed the green card

and an agent of the registered agent—again, the very deficiency identified as rendering

proof of service fatally defective by Asset Protection and the cases it catalogs, including

an opinion from this court. 570 S.W.3d at 383–84 (citing MYRMAC Corp., 2017 WL

1173841, at *2).

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      F.     Agnew steps outside the record and asks us to rely on evidence
             that he attached to his brief to show that HWAT had notice of his
             suit and to fill the gap in the record’s proof of service. We cannot
             look to evidence outside the appellate record, and even if we could,
             Agnew’s “evidence” of HWAT’s acknowledgement of service does
             not remedy the error evident on the face of the record.

      Agnew’s brief includes extra-record evidence in the form of (1) an email from

HWAT to Agnew’s counsel acknowledging receipt of the suit papers and (2) a return

of citation from an unrelated case that establishes that the person who signed the

green card at issue was an agent of HWAT’s corporate registered agent. Counsel also

attached to the brief his own affidavit that attempts to authenticate the email and

claims that he confirmed that the signatory in the return of citation from an unrelated

case was an agent of HWAT.

      As a general proposition, we cannot review documents outside the appellate

record. In re A.M., No. 02-18-00412-CV, 2020 WL 3987578, at *1, n.1 (Tex. App.—

Fort Worth June 4, 2020, no pet.) (mem. op.) (limiting review “to those facts and

exhibits [that] are part of the record before us”); Leggett v. SFJV 2004-1, LLC, No. 2-

06-128-CV, 2007 WL 2963775, at *1 (Tex. App.—Fort Worth Oct. 11, 2007, pet.

dism’d w.o.j.) (per curiam) (mem. op.) (“We may not look outside the record but must

decide the case on the record as filed.”); Quorum Int’l v. Tarrant Appraisal Dist., 114

S.W.3d 568, 572 (Tex. App.—Fort Worth 2003, pet. denied) (“We cannot look

outside the record in an effort to discover relevant facts omitted by the parties; rather,

we are bound to determine this case on the record as filed.”).

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      And even if we could consider the extra-record evidence that HWAT allegedly

acknowledged that it had been served with the suit papers, that evidence is still

unavailing to Agnew.      Simply, “[i]t is well established that ‘[a]ctual notice to a

defendant, without proper service, is not sufficient to convey upon the court

jurisdiction to render [a] default judgment against him.’” Wyatt v. Deal, No. 02-18-

00246-CV, 2019 WL 2432156, at *5 (Tex. App.—Fort Worth June 6, 2019, no pet.)

(mem. op.); Offshore Express, Inc. v. Klein Investigations & Consulting, No. 09-17-00333-

CV, 2018 WL 6542502, at *3 (Tex. App.—Beaumont Dec. 13, 2018, no pet.) (mem.

op.) (citing Wilson, 800 S.W.2d at 836; Harrell v. Mex. Cattle Co., 11 S.W. 863, 865 (Tex.

1889)).

      Because we are constrained by case law to limit our review to the facts and

exhibits in the record, we cannot consider the exhibits attached to Agnew’s brief to

connect the signatory to the proof of service.

      G.     Disposition

      As noted, the face of the record manifests a defect in the service-of-process

proof requirements. The defect in the certified-mail receipt is dispositive, and we

need not address the other defects in the proof of service that HWAT claims exist.

See Tex. R. App. P. 47.1. Accordingly, we sustain HWAT’s sole issue.

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                                 IV. Conclusion

      Having sustained HWAT’s sole issue, we reverse the trial court’s default

judgment and remand the case for further proceedings consistent with this opinion.

                                                    /s/ Dabney Bassel

                                                    Dabney Bassel
                                                    Justice

Delivered: April 1, 2021

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