Court Opinion

ID: 4068314
Source: CourtListenerOpinion
Date Created: 2016-09-29 23:48:06.273216+00
Date Added: 2024-06-11T13:08:54.765877
License: Public Domain

ACCEPTED
                                                                   14-15-00026-CV
                                                   FOURTEENTH COURT OF APPEALS
                                                                HOUSTON, TEXAS
                                                              6/15/2015 7:55:45 PM
                                                             CHRISTOPHER PRINE
                                                                            CLERK

           NO. 14-15-00026-CV

           IN THE COURT OF APPEALS          FILED IN
FOR THE FOURTEENTH JUDICIAL DISTRICT OF TEXAS
                                      14th COURT OF APPEALS
                                         HOUSTON, TEXAS
               HOUSTON DIVISION
                                          6/15/2015 7:55:45 PM
                                          CHRISTOPHER A. PRINE
                                                   Clerk
         LAWRENCE C. MATHIS,

                 Appellant

                    vs.

     DCR MORTGAGE III SUB I, LLC,

                 Appellee

 Appeal from Cause No. D-1-GN-09-001377
126th District Court in Travis County, Texas

           APPELLEE’S BRIEF

                   Steve Skarnulis
                   State Bar No. 24041924
                   skarnulis@cstrial.com
                   Patrick J. Fitzgerald
                   State Bar No. 24036566
                   pfitzgerald@cstrial.com
                   CAIN & SKARNULIS PLLC
                   400 W. 15th Street, Suite 900
                   Austin, Texas 78701
                   512-477-5000
                   512-477-5011—Facsimile
                   COUNSEL FOR APPELLEE
                   LAWRENCE C. MATHIS
                IDENTITY OF PARTIES AND COUNSEL

Appellant                DCR Mortgage III Sub I, LLC

Appellant’s Trial and    Thomas M. Hanson
Appellate Counsel        thanson@dykema.com
                         Jason M. Ross
                         jross@dykema.com
                         DYKEMA GOSSETT PLLC
                         1717 Main Street, Suite 4200
                         Dallas, Texas 75201
                         214-462-6400
                         214-462-6401—Facsimile

Appellee                 Lawrence C. Mathis

Appellee’s Trial and     Steve Skarnulis
Appellate Counsel        skarnulis@cstrial.com
                         Patrick J. Fitzgerald
                         pfitzgerald@cstrial.com
                         CAIN & SKARNULIS PLLC
                         400 W. 15th Street, Suite 900
                         Austin, Texas 78701
                         512-477-5000
                         512-477-5011—Facsimile

                                 i
                                        TABLE OF CONTENTS

                                                                                                               Page

IDENTITY OF PARTIES AND COUNSEL ............................................................ i

TABLE OF CONTENTS .......................................................................................... ii

INDEX OF AUTHORITIES.................................................................................... iv

STATEMENT OF THE CASE ................................................................................ vi

STATEMENT REGARDING ORAL ARGUMENT .............................................. vi

COUNTER STATEMENT OF ISSUES PRESENTED ........................................... 1

         1.       On a general remand with instructions, can a party amend its
                  pleading pursuant to Texas Rule of Civil Procedure 63? ..................... 1

         2.       Where a trial court is instructed on remand to make
                  computations and provide for disbursements, is it proper for the
                  court to award disbursement of amounts paid out of the registry
                  of the court under a judgment that was subsequently reversed? .......... 1

         3.       Did the trial court act within its discretion to award attorney’s
                  fees under a declaratory judgment claim on a remand trial under
                  a general mandate with instructions? ................................................... 1

OBJECTIONS TO APPELLANT’S STATEMENT OF FACTS ............................ 1

COUNTER STATEMENT OF FACTS ................................................................... 2

SUMMARY OF THE ARGUMENTS ..................................................................... 4

ARGUMENT ............................................................................................................ 5

         A.       Amended Pleadings Were Properly Allowed on Remand ................... 5

         B.       The Bench Trial Was Required By the Mandate and Necessary
                  to Enter Judgment of Any Kind ........................................................... 7

                                                          ii
        C.      Trial Court’s Computations and Disbursements Were Well
                Within the Court’s Discretion .............................................................. 8

                1.      Although the basis for DCR’s challenge is unclear, the
                        proper standard is simply an abuse of discretion ....................... 8

                2.      The trial court calculated a fair amount that should have
                        been awarded to Mr. Mathis had DCR not already taken
                        the registry funds ........................................................................ 9

                3.      DCR’s “free rent” and “note balance” arguments do not
                        demonstrate that the court did not perform proper
                        computations and disbursements, and the arguments are
                        mooted by DCR’s wrongful foreclosure .................................. 11

                4.      The trial court made no mathematical errors and DCR did
                        not provide alternative amounts ............................................... 12

        D.      The Attorney’s Fees Awarded Were Equitable and Just .................... 14

                1.      Fees were not beyond the scope of the mandate ...................... 14

                2.      The fees awarded were reasonable, necessary and within
                        the court’s discretion ................................................................ 14

CONCLUSION AND PRAYER ............................................................................ 15

CERTIFICATE OF SERVICE ............................................................................... 16

CERTIFICATE OF COMPLIANCE ...................................................................... 16

                                                       iii
                                       INDEX OF AUTHORITIES

CASE LAW                                                                                                           Page

Lampman v. First Nat’l Bank in Dallas,
    463 S.W.2d 28 (Tex. Civ. App.—Waco 1970, writ ref’d n.r.e.) .................... 6

Mathis v. DCR Mortg. III, Sub I, LLC,
     389 S.W.3d 494 (Tex. App.—El Paso 2012, no pet.) ................................ 2, 3

Mathis v. DCR Mortg. III Sub I, LLC,
     Case 1:13-cv-00192-SS, In the United States District Court for the
     Western District of Texas, Austin Division.................................................... 3

Reynolds v. Murphy,
     266 S.W.3d 141 (Tex. App.—Fort Worth 2008, pet. denied) .................... 5, 6

Stephenson v. LeBoeuf,
      16 S.W.3d 829 (Tex. App.—Houston [14th Dist.] 2000, pet. denied ............ 8

Tanglewood Homes Ass’n Inc. v. Feldman,
      436 S.W.3d 48 (Tex. App.—Houston [1st Dist.] 2014, pet. denied) ......... 8, 9

Tex. Liq. Contr. Bd. v. Canyon Creek Land Corp.,
      466 S.W.2d 891 (Tex. 1970) ........................................................................ 13

U.S. Fid. & Guar. Co. v. Beuhler,
     597 S.W.2d 523, 524-24 (Tex. Civ. App.—Beaumont 1980, no writ) ............ 5

STATUTES AND RULES

TEX. CIV. PRAC. & REM. CODE § 37.010 (West 2010) .............................................. 8

TEX. R. APP. P. 38.1(g) .............................................................................................. 1

TEX. R. CIV. P. 63 ...................................................................................................... 6

                                                            iv
OTHER

Merriam Webster Online Dictionary
at www.merriam-webster.com/dictionary/disbursement ........................................ 10

W. Wendell Hall, D. Ray Rodriguez, Hall’s Standards of Review in Texas,
42 ST. MARY’S L.J. 3, 67 (2010) ............................................................................... 9

                                                       v
                         STATEMENT OF THE CASE

      This appeal deals with a short, one-day remand trial that was held in

accordance with the judgment, mandate and opinion issued by the Eight Court of

Appeals. As instructed by the mandate, the trial court made computations and

ordered the disbursement to Appellee Lawrence C. Mathis of $57,228.16,

representing some of the amounts paid into the trial court’s registry and then paid

to Appellant DRC Mortgage III, Sub I, LLC during the pendency of the appeal.

The court also awarded Mathis attorney’s fees of $158,000 under his declaratory

judgment claim, along with costs and pre-judgment interest.

              STATEMENT REGARDING ORAL ARGUMENT

      Mr. Mathis does not request oral argument, as the issues raised on appeal are

simple, straightforward and controlled by settled law.

                                         vi
TO THE HONORABLE FOURTEENTH COURT OF APPEALS:

      Appellee Lawrence C. Mathis (Mathis) files this brief asking the Court to

overrule Appellant’s issues and affirm the district court’s final judgment in all

respects. Mathis respectfully shows:

                COUNTER-STATEMENT OF ISSUES PRESENTED

      1.        On a general remand with instructions, can a party amend its pleading

pursuant to Texas Rule of Civil Procedure 63?

      2.        Where a trial court is instructed on remand to make computations and

provide for disbursements, is it proper for the court to award disbursement of

amounts paid out of the registry of the court under a judgment that was

subsequently reversed?

      3.        Did the trial court act within its discretion to award attorney’s fees

under a declaratory judgment claim on a remand trial under a general mandate with

instructions?

           OBJECTION TO APPELLANT’S STATEMENT OF FACTS

      Appellee objects to the argumentative nature of Appellant’s statement of

facts. TEX. R. APP. P. 38.1(g). For example, Appellant states that “Mathis filed a

spate of lawsuits and amended petitions, all in an attempt to expand the scope of

the mandate . . . .” Appellant’s Brief at 9. Mr. Mathis filed one lawsuit against

DCR after the Eighth Court found that DCR had not accelerated its note, thereby

                                           1
rendering DCR’s foreclosure improper. DCR removed the suit to federal court.

Mr. Mathis amended his petition in an attempt to consolidate the federal and state

litigation, and to reflect the facts that had changed since the trial court’s judgment.

      Appellee objects to Appellant’s mischaracterization and misstatement of the

mandate. Appellant’s Brief at 9. The mandate is general, reversing the judgment

and remanding for further proceedings in accordance with the court’s opinion.

See CR 133. The opinion, and not the mandate, instructs the trial court on remand

to determine final computations and provide for disbursements. See CR 92.

                      COUNTER STATEMENT OF FACTS

      The Eighth Court’s opinion accurately states the facts through the trial

court’s original judgment. See Mathis v. DCR Mortg. III, Sub I, LLC, 389 S.W.3d
494, 496-504 (Tex. App.—El Paso 2012, no pet.). As part of its final judgment,

the original trial court ordered the court clerk to pay to DCR $105,728.16 paid by

Mathis into the registry of the Court. See id. at 501. The amount included a

payment of $52,025.60 tendered by Mathis on April 8, 2009 to bring the note

current. Id.; RR Vol. 4; pp. 31-34.

      After the trial court’s judgment, Mr. Mathis appealed, but could not afford a

supersedeas bond. RR Vol. 2; p. 88:11-12. During the appeal DCR again began

the foreclosure process. DCR foreclosed on the note on February 1, 2011 and took

possession of the building through a credit bid. See RR Vol. 2; pp. 77:3-10,

                                           2
122:2-5; RR Vol. 4; pp. 434-439. That foreclosure is the subject of a wrongful

foreclosure suit pending in the United States District Court, Western District of

Texas.   See RR Vol. 2; p. 174:3-9; Mathis v. DCR Mortg. III Sub I, LLC,

Case 1:13-cv-00192-SS, In the United States District Court for the Western District

of Texas, Austin Division.

      On June 21, 2011 DCR received approximately $105,000 that had been paid

into the registry of the Court by Mr. Mathis. RR Vol. 4; p. 441; RR Vol. 2;

p. 185:13-15.   The note had been extinguished by the foreclosure, so DCR

accounted for the funds as rent. RR Vol. 2; pp. 185:16-186:2. In October 2012,

Texas' Eighth Court of Appeals found for Mr. Mathis and determined that the Note

and deed of trust did not clearly and unequivocally waive Mr. Mathis's right to

notice of intent to accelerate and time to cure, and any attempted acceleration was

ineffective. Mathis, 389 S.W.3d at 496. The judgment was reversed and the case

remanded. Id.

      On remand, Mr. Mathis amended the petition in an attempt to consolidate the

federal wrongful foreclosure action and the state court remand. See CR 195-204.

DCR moved to strike the second amended petition, favoring separate state and

federal trials. See id. at 205-17. Mr. Mathis then amended to remove the federal

court claims, and Plaintiff’s Third Amended Petition and Fourth Amended Petition,

                                        3
the live pleading at the time of the remand trial, had only a declaratory judgment

cause of action. CR 218-25; 290-97.

                      SUMMARY OF THE ARGUMENT

      Amending pleadings on remand is hardly a novel concept, and the trial court

properly allowed Appellee’s amendments.       A party may amend its pleadings

without leave on remand, and the amendments were not only within the scope of

the general remand, they were expressly addressing the Eighth Court of Appeal’s

instructions.   Although a consolidation of the state remand and the federal

wrongful foreclosure case would have saved judicial and economic resources,

ultimately, absent DCR’s agreement, the remand proceeding was simply a

declaratory judgment action, the same cause of action contained in Plaintiff’s

Original Petition. See CR 4-13. Therefore, even if the amendments were in error,

it was harmless.

      The remand bench trial was necessary and expressly required by the mandate

and opinion of the court of appeals. DCR’s contention that it was an abuse of

discretion for the trial court not to simply enter a judgment without a remand

proceeding is a stretch. Even the relief sought in Defendant’s Motion for Entry of

Final Judgment required the introduction of new evidence. DCR’s motion attached

new evidence of the actual foreclosure, the substitute trustee’s deed.

See CR 136-50. That evidence was not properly admitted by DCR’s motion and

                                        4
could not properly be admitted without a remand trial. The trial court did not

abuse its discretion in conducting the brief remand trial.

      Under an abuse of discretion standard, the trial court’s calculations and

disbursements are clearly supported by careful reasoning, as the judge simply

calculated the amount to put Mr. Mathis in the position had DCR not wrongly

rejected his tender of payments to become current under the note, applying the

parties’ respective note calculations through that April 2009 date.

      Finally, the trial court had the discretion on remand to award fees to

Mr. Mathis, just as fees had been awarded to DCR in the original trial reversed by

the Eighth Court. The fees awarded were significantly lower than Mr. Mathis’

actual fees, and the amounts were supported by proper expert testimony.

                                   ARGUMENT

A.    Amended Pleadings Were Properly Allowed on Remand

      Amendment on remand is not a novel procedure. See, e.g., Reynolds v.

Murphy, 266 S.W.3d 141, 146-47 (Tex. App.—Fort Worth 2008, pet. denied)

(“Generally’ [w]hen a case has been remanded, the cause is pending and amended

pleadings may be filed in pending cases pursuant to [rule] 63’” citing

U.S. Fid. & Guar. Co. v. Beuhler, 597 S.W.2d 523, 524-24 (Tex. Civ. App.—

Beaumont 1980, no writ)). In the present case, the amendment applicable at the

time of the remand trial merely clarified the declaratory relief sought, in order to

                                          5
correspond to the opinion of the court of appeals. The amendments in this case are

quite similar to the amendment allowed in Lampman v. First Nat’l Bank in Dallas,

463 S.W.2d 28 (Tex. Civ. App.—Waco 1970, writ ref’d n.r.e.).

      In Lampman, the trial court entered a money judgment against the bank. See

id. On appeal, the judgment was reversed and remanded “for determination only of

reasonable attorney’s fees” due to the bank. Id. The bank on remand amended its

pleading, and instead of asking for $500 attorney’s fees, it asked for “reasonable

attorney’s fees.” See id. at 28-29. The bank then obtained a judgment for $2,150

in fees, and on appeal, the amendment was upheld, because amendment under

Rule 63 is allowed after a reversal and remand. See id. at 29; TEX. R. CIV. P. 63.

      In the present case, the second amended petition attempted to consolidate the

actual wrongful foreclosure case pending in federal court with the state court

proceeding. CR 195-204. That amendment added a new claim based on facts not

before the Eighth Court of Appeals, and as in Reynolds, the remand did not

indicate that new claims based on new facts could not be alleged. Reynolds,
266 S.W.3d at 147. However, none of this matters, as ultimately the petition

controlling the remand trial was a pleading that clarified the original declaratory

judgment to ask for (i) a computation of amounts due under the note; (ii) a

disbursement, or unwinding of the disbursement previously made to DCR

following foreclosure; and (iii) reasonable and necessary attorney’s fees.

                                         6
CR 290-97. Therefore, even if allowing the second amended petition to be filed

was error, such error was harmless. The live pleading was the same declaratory

judgment action alleged in the original petition. The trial court could not have

abused its discretion in proceeding under an amended petition that simply asked for

relief premised entirely on the instructions of the opinion of the court of appeals.

B.     The Bench Trial Was Required By the Mandate and Necessary to
       Enter Judgment of Any Kind

      DCR contends the Court abused its discretion by not simply entering

judgment without a remand trial. Appellant’s Brief at 16. DCR contends that its

foreclosure and receipt of the registry funds mooted any need for the remand

proceeding ordered by the mandate and opinion. See id. at 18-21. But the court

could not have entered judgment as requested by DCR without admitting new

evidence.    The record was devoid of any evidence that there had been a

foreclosure. The record contained nothing about DCR’s post-foreclosure receipt of

the registry funds, save for the order. In order to get the judgment DCR says the

trial court should have entered, there had to be a trial to admit evidence showing

that the remand ordered by the court of appeals was moot.

      DCR’s Motion for Entry of Judgment demonstrates the need for a remand

proceeding. CR 136-50. The motion attaches the substitute trustee’s deed that was

never admitted into evidence. See id. at 143. The judgment DCR wanted (in order

to avoid the trial court’s award of attorney’s fees to Mr. Mathis) required a remand

                                          7
trial to admit evidence of the foreclosure. Furthermore, after DCR foreclosed,

extinguished the note and then took possession of Mr. Mathis’ valuable

commercial building, DCR received a windfall of the $105,678.16 Mr. Mathis had

paid into the registry of the court. See RR Vol. 2; pp. 77:3-10; 122:2-5; RR Vol. 4;

pp. 434-439; 441. There had to be a trial to properly make computations and

disbursements to resolve the registry funds—consistent with the mandate and

opinion.

      The trial court did not abuse its discretion by conducting the bench trial.

C.     Trial Court’s Computations and Disbursements Were Well Within the
       Court’s Discretion

      1.     Although the basis for DCR’s challenge is unclear, the proper
             standard is simply an abuse of discretion.

      DCR boldly states that “A declaratory judgment should be reversed unless

‘it is sustainable upon any legal theory supported by the evidence,’” quoting

Tanglewood Homes Ass’n Inc. v. Feldman, 436 S.W.3d 48, 76 (Tex. App.—

Houston [1st Dist.] 2014, pet. denied) and Stephenson v. LeBoeuf, 16 S.W.3d 829,

842 (Tex. App.—Houston [14th Dist.] 2000, pet. denied. The quotation certainly

puts a negative spin on the full quotation from those cases, in an effort by DCR to

dance around the fact that the proper standard of review is abuse of discretion.

      Declaratory judgments are reviewed under the same standards as other

judgments. TEX. CIV. PRAC. & REM. CODE § 37.010 (West 2010). The appellate

                                          8
court looks to the procedure used to resolve the issue below to determine the

standard of review. Tanglewood Homes, 436 S.W.3d at 66. When the trial court’s

findings involve questions of law and fact, the appellate court reviews the trial

court’s decision for an abuse of discretion. W. Wendell Hall, D. Ray Rodriguez,

Hall’s Standards of Review in Texas, 42 ST. MARY’S L.J. 3, 67 (2010). A trial

court abuses its discretion only if it is so arbitrary or unreasonable that it amounts

to a clear and prejudicial error of law.

      The trial court did not in any way abuse its discretion to declare the rights

and legal status of the parties on remand.

      2.     The trial court calculated a fair amount that should have been
             awarded to Mr. Mathis had DCR not already taken the registry funds.

      As is evident from the record of the remand trial, both parties attempted to

prove up their note calculations to the court as of the date of foreclosure,

February 1, 2011. But the trial court interpreted the task mandated by the Eighth

Court differently:

      I'm going to give you my full kind of thought process here, is I go
      back to '09, really, and I go back to the decision to accelerate, which
      we now know that the Court of Appeals believed - I'm going to say
      their exact language. The Court of Appeals wrote that, “There was no
      notice of intent to accelerate and time to cure, and because there was
      not effective waiver of notice of intent to accelerate, acceleration was
      void as a matter of law.” So that's the date I'm looking at. And given
      everything that's happened since, which really makes it more
      confusing, I go back to that, the improper acceleration and try to put a
      number in place then consistent with the Eighth Court of Appeals'

                                             9
      ruling. And what I come up with, the amount of damages that the
      plaintiff is entitled to is $57,228.16.

                                       ***

      And I, basically took the amount of money that was in the Registry of
      the Court and subtracted it by the amount of money – the 52,025.60,
      that was the lump sum payment that Mr. Mathis paid, and then added
      on top of that the $3,500 worth and some change in fees that the
      plaintiffs also had.

RR Vol. 2; pp. 192-93. The court did not act arbitrarily or unreasonably in trying

to apply and give full effect to the mandate and opinion under which the court was

proceeding.   Judge Meachum’s discussion of the computation she performed

indicated that she was attempting to place the parties in status quo ante the appeal

and foreclosure. This factual determination is fully supported by the trial court’s

authority to perform the computations and make disbursements.

      DCR does not attempt to distinguish the difference between disbursements

and damages. Merriam Webster defines disbursement as the act of disbursing, or

funds paid out. www.merriam-webster.com/dictionary/disbursement. The registry

funds had been wrongfully disbursed to DCR during the pending appeal, so the

court, to effect a disbursement to Mr. Mathis, awarded the amount of the registry

funds to which the court determined he was entitled.

      DCR can point to no evidence in the record where DCR provided the trial

court with its own calculation of the amount that should be disbursed to

                                        10
Mr. Mathis. DCR simply disagrees with the court’s finding, which is not enough

to reverse the judgment.

      3.    DCR’s “free rent” and “note balance” arguments do not demonstrate
            that the court did not perform proper computations and
            disbursements, and the arguments are mooted by DCR’s wrongful
            foreclosure.

      DCR argues, in the alternative, that the judgment gives Mr. Mathis free rent,

or that his $3,500 monthly payments into the registry were exhausted under the

note by December 2010. Appellant’s Brief at 26-27. But the very foreclosure that

DCR contends moots the need for a remand trial eliminates these arguments.

DCR, at its own risk during the appeal, took possession of Mr. Mathis’ building.

That extinguished the note and thereby eliminated any amounts owing by

Mr. Mathis. Therefore, Mr. Mathis could not have owed any “rent” (for which

there is no record support) and whether the payments into the court did not meet

the amount owed as of February 2011 (2 months after the exhaustion of such funds

under the note terms) is of no consequence. DCR chose to wrongfully exercise its

foreclosure remedy based on the trial court’s judgment that was later reversed. In

doing so, DCR eliminated any claim that it was owed anything by Mr. Mathis.

The note was completely extinguished, and in return, DCR possessed a valuable

Austin property.   If anything, DCR was unjustly enriched via the wrongful

foreclosure—not deprived of rents or note payments—which is why there is a

pending wrongful foreclosure lawsuit.

                                        11
       DCR further argues that the payments into the court’s registry, if applied to

the note, would have been exhausted some two months prior to the foreclosure.

Appellant’s Brief at pp. 26-28. But the $105,000 was never applied to the note.

DCR took the $105,000 as a windfall months after foreclosing and extinguishing

the note. RR Vol. 4; p. 441.

       DCR’s arguments have no bearing on the trial court’s decision under the

mandate and opinion. DCR is simply arguing the equities. But if DCR wants to

argue equity to this Court on appeal, Mr. Mathis would point out that the record

shows a 2006 appraised value of his property at $1,235,000 and a negotiated sales

price of $1,525,000. RR Vol. 4; pp. 615; 604. Mr. Mathis owed DCR only

$250,824.78. RR Vol. 2; p. 87:6-8.

       DCR’s arguments do not go to show that the calculation was unreasonable

or arbitrary.

       4.       The trial court made no mathematical errors and DCR did not
                provide alternative amounts.

       In arriving at its judgment, the trial court was not required to provide to

DCR its precise calculation of the amount that should be disbursed to Mr. Mathis.

Still, the judge did provide guidance on how she arrived at her decision, and her

figure is supported by the evidence. Whether or not Mr. Mathis made payments to

DCR of $2,601,28 or $924.32, the trial court determined that approximately $3,500

out of the money actually paid in was owed back to Mr. Mathis. See RR Vol. 2;

                                         12
p. 193:2-18. As the trial court noted, she was sitting in equity in making that

determination. Id. at 193:3-7. While an action for declaratory judgment is neither

legal nor equitable, it is sui generis, and gives the court broad powers to afford the

relief it deems proper.     Tex. Liq. Contr. Bd. v. Canyon Creek Land Corp.,

466 S.W.2d 891, 895 (Tex. 1970). The trial court’s calculation is not susceptible

to attack based on creative arguments and arithmetic—it was a just and right

determination of an amount that should have been refunded to Mr. Mathis.

      DCR’s attacks on the trial court’s math are quickly dismissed. Mathis used

a 17.5%, because that is what DCR’s spreadsheets used.               RR Vol. 2; pp.

81:22-82:1. The note does not “call for” reamortization, it gives DCR the option

and DCR never did so throughout the life of the note. There is no record cite for

the reamortization because the argument came up for the first time in the federal

court litigation recently. Finally, legal fees expended by DCR have no bearing on

the calculation, as DCR was ultimately not the prevailing party. See RR Vol. 2;

pp. 179:11-180:9.

      Furthermore, the record does not show that DCR attempted to prove its own

calculation of a disbursement to Mr. Mathis. DCR wanted absolutely nothing to be

awarded to him. The issues raised on appeal were in no way raised by DCR at

trial, and any objection to them was waived.

                                         13
D.    The Attorney’s Fees Awarded Were Equitable and Just

      1.     Fees were not beyond the scope of the mandate.

      Even if Mr. Mathis had not amended his petition to add a request for fees

under the declaratory judgment claim, his original petition requested fees.

CR 11, ¶ XVII. The mandate did not prohibit an award of fees. Furthermore,

DCR waived any post facto objection to fees by failing to object to the admission

of testimony or documentary evidence supporting the award.        See, generally,

RR Vol 2; 147:10-154:22.

      This was a five-year struggle for Mr. Mathis, and the fees awarded were

significantly lower than the $270,996.25 actually expended by Mr. Mathis in his

attempt to protect his property.

      2.     The fees awarded were reasonable, necessary and within the court’s
             discretion.

      After a scorched-earth litigation, DCR now claims that “this is a profoundly

simple case.” Appellant’s Brief at pp. 36-37. The record shows otherwise, and not

because of Mr. Mathis. DCR refused to consolidate the wrongful foreclosure case,

and the fees sought by Mr. Mathis in the present case do not include those fees he

has incurred in the federal litigation. The Arthur Anderson factors are satisfied.

DCR did not challenge the expert testimony on fees. DCR can point to no case

depriving the trial court of the authority to award fees in excess of the computed

amount of $57,228.16. The fees were equitable, just, reasonable, and necessary.

                                       14
In no way was the award arbitrary or unreasonable, and the award of attorney’s

fees should stand.

                        CONCLUSION AND PRAYER

      For all these reasons, Appellee asks the Court to affirm the judgment of the

trial court in all respects, and to award such other and further relief to which he

may be entitled.

                                      Respectfully submitted,

                                             /s/ Steve Skarnulis
                                      Steve Skarnulis
                                      State Bar No. 24041924
                                      skarnulis@cstrial.com
                                      Patrick J. Fitzgerald
                                      State Bar No. 24036566
                                      pfitzgerald@cstrial.com
                                      CAIN & SKARNULIS PLLC
                                      400 W. 15th Street, Suite 900
                                      Austin, Texas 78701
                                      512-477-5000
                                      512-477-5011—Facsimile
                                      COUNSEL FOR APPELLEE
                                      LAWRENCE C. MATHIS

                                        15
                         CERTIFICATE OF SERVICE

        I certify that a true and correct copy of Appellee’s Brief has been forwarded
to all counsel of record in accordance with the Texas Rules of Appellate Procedure
on this 15th day of June 2015, as follows:

   Method of Service           Party(ies)                    Counsel
E-service                    Appellant           Thomas M. Hanson
                                                 thanson@dykema.com
                                                 Jason M. Ross
                                                 jross@dykema.com
                                                 DYKEMA GOSSETT PLLC
                                                 1717 Main Street, Suite 4400
                                                 Dallas, Texas 75201
                                                 214-462-6400
                                                 214-462-6401—Facsimile

                                             /s/Steve Skarnulis
                                       Steve Skarnulis

                      CERTIFICATE OF COMPLIANCE

      I certify that this Brief complies with the typeface requirements of Texas

Rule of Appellate Procedure 9.4(e) because it has been prepared in a conventional

typeface no smaller than 14-point for text and 12-point for footnotes.          This

document also complies with the word-count limitations of Texas Rule of

Appellate Procedure 9.4(i), if applicable, because it contains 3,476 words,

excluding any parts exempted by Texas Rule of Appellate Procedure 9.4(i)(1).

DATED:             June 15, 2015

                                             /s/ Steve Skarnulis
                                       Steve Skarnulis

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