Court Opinion

ID: 2921964
Source: CourtListenerOpinion
Date Created: 2015-09-11 02:28:34.796982+00
Date Added: 2024-06-11T11:38:46.985733
License: Public Domain

NUMBER 13-01-255-CV

COURT OF APPEALS

THIRTEENTH DISTRICT OF TEXAS

CORPUS CHRISTI

ROBERT D. RAPP,                                                                       Appellant,

v.

MANDELL & WRIGHT, P.C.,                                                         Appellee.

On appeal from the 221st District Court
of Montgomery County, Texas.

OPINION ON MOTION FOR REHEARING 

Before Justices Yañez, Dorsey
, and Amidei

Opinion by Justice Amidei

          Robert D. Rapp’s motion for rehearing is granted. The opinion and judgment issued
August 28, 2003, are withdrawn and the following is substituted.
          Robert D. Rapp, appellant, appeals from a jury verdict and judgment in a trial of an
intervention by Mandell & Wright, P. C., appellee, and appellant’s “conditional” intervention,
both asserting the right to receive attorney’s fees and expenses in the underlying wrongful
death personal injury case which had been previously settled.  Although the Ross and
Thornhill survivors, plaintiffs in the underlying case, were named as parties in appellee’s
intervention, they were not served with citation and were dismissed as parties prior to trial.
          Appellant claims that as a matter of law he is entitled to the $401,110.89 deposited
in the registry of the court, representing the contingent fees in question, as well as the
$275,425 deposited for expenses, and that the trial court erred in denying his motion for
judgment notwithstanding the verdict of the jury and motion for new trial which contain his
grounds therefor.  In five issues, appellant repeats the grounds of such motions that argue
the trial court erred:  (1) as a matter of law in denying appellant's motion for judgment
notwithstanding the verdict of the jury (JNOV); (2) in allowing evidence of appellant's
former employment status and shareholder agreement which led to the rendition of an
improper verdict; (3) in denying appellant's motion for new trial because the answers to all
material jury questions were either supported by insufficient evidence or so against the
great weight and preponderance of the evidence as to be manifestly unjust; (4)
alternatively, in not equitably splitting the Thornhill fee between appellant and appellee; and
(5) alternatively, in not awarding appellant his attorney's fees as found by the jury.
Factual and Procedural Background
          In 1987, while appellant was a shareholder and an employee of appellee, a
professional corporation, he was contacted by two attorneys in the Midwest to handle
wrongful death cases for the families of two truck drivers who lost their lives in a truck stop
fire at Conroe, Texas.  Appellant agreed to represent the plaintiffs and signed the
contingent fee contracts, each of which provided a contingent fee of 33 1/3 percent of the
recovery.  The contracts designated appellant “of counsel,” but there was no other name
or signature of any other attorney or agent thereon.  Appellant was the lead attorney and
legal strategist performing the great majority of the work in the case.  Zoe Littlepage, a
less-experienced lawyer, hired by appellee sometime in 1990, worked on some of the
simpler matters.  Littlepage and another appellee attorney assisted appellant until they left
the corporation shortly after the trial court entered the final judgment.  Being the legal
strategist in this case was especially important because the arsonist who set the fire at the
truck stop, as well as the truck stop owners, were “judgment-proof.”  Even after appellant
devised a unique theory of recovery (appellant asserts that the theory is unprecedented
in the United States) against the owners' lender, the lender filed a bankruptcy in
Pennsylvania and several years of maneuvering by appellant were required in order to
secure guaranteed insurance coverage out of the bankruptcy.  After the insurance
coverage was obtained, the case was tried.  The trial lasted one month and resulted in a
jury verdict for the plaintiffs in excess of $4 million, and specifically implicated the owners'
lender pursuant to appellant's unique theory that the lender was responsible for the
operation of the truck stop with the owners and had a non-delegable duty to initiate and
maintain safety features that probably would have prevented the fire or at least the deaths. 
However, the trial court granted the solvent defendants' motion for JNOV and awarded
damages only against the insolvent defendants in August 1993.
          Between 1994 and 1996, appellee repeatedly contemplated claiming the plaintiffs’
case as a loss for tax purposes and dropping the case, but appellant strongly opposed
these efforts.  In 1996, appellant and appellee had disputes over appellant's employment
contract, which he refused to sign.  In March 1997, unable to reach an agreement,
appellee terminated appellant.  By agreement, the client files were divided between
appellant and appellee, with appellant accepting seven files, including the plaintiffs’ case,
all of which appellee viewed as having little prospect of recovery.  The remaining cases
were retained by appellee.  As to the divided cases, no express agreement was made as
to fee or expense-sharing between appellee and appellant.
          Appellant appealed the trial court judgment, and in May of 1997, the Ninth Court of
Appeals in Beaumont reversed the trial court's judgment and reinstated the jury's verdict.
          At this time, after learning appellant was no longer with appellee, the plaintiffs,
through the Midwest attorneys who referred the cases to appellant, sent letters to appellee
directing that the file be turned over to appellant to ensure access for necessary work left
to be done.  The letters expressed the plaintiffs' desire that appellant continue to be in
charge of the case as he had been for ten years, but did not discharge or request appellee
to withdraw from the case.  No additional written contingent fee contracts were made, but
after appellant was fired by appellee, the plaintiffs reaffirmed their agreement to pay
appellant the originally-agreed-to contingent fee.  Appellant continued representing the
plaintiffs during the defendants’ attempted appeal of the case to the Texas Supreme Court. 
While the case was pending in the Ninth Court of Appeals, on July 25, 1997–without any
prompting by the Midwest attorneys, the plaintiffs, or the appellant–appellee voluntarily and
unilaterally filed a motion to withdraw from the plaintiffs' case.  The court of appeals
considered the motion moot since the plaintiffs already had designated the appellant as
their attorney of record, and appellee was not listed as an attorney for the plaintiffs.
          Appellant convinced the plaintiffs and the Midwest attorneys to agree to mediation
rather than risk potential review in the Texas Supreme Court.  In November 1997, appellant
successfully mediated the plaintiffs' case by obtaining a settlement with the lender's
insurance company in the amount of $1.9 million, which was $1.8 million more than the
insurer had previously offered.
          Prior to the January 5, 1998, scheduled funding of the settlement, appellee filed an
intervention in the underlying case, alleging it was entitled to all of the $676,535.89 on
deposit, but did not name an adverse party.  The trial court ordered the $676,535.89 to be
deposited into the registry of the court, and allowed the plaintiffs to receive the balance of
the $1.9 million settlement.  Pursuant to the agreement of the plaintiffs, appellee, and
appellant, the amended final judgment included the order as follows: “No party to these
proceedings waives any position by agreeing to place these funds in the Registry of the
Court.”  After appellant answered and moved to strike appellee's intervention on the
grounds he was entitled to the fees as the primary attorney of record at the time the case
was settled, appellee amended and claimed appellant had no standing because he had
not intervened.  Thereafter, appellant filed his "conditional" petition in intervention asserting
his claim to the fees should such plea be necessary.  Both parties' motions for summary
judgment were denied. Appellee filed an amended intervention and although the plaintiffs
were named as parties, with breach of contract and unjust enrichment claims asserted
against them, they were never served with the intervention.  Appellant answered appellee's
amended intervention alleging waiver, estoppel, accord and satisfaction, abandonment of
the plaintiffs, and the invalidity of the intervention under the fee agreements; he also
pointed out that the plaintiffs had not been served with citation on the intervention. 
Appellee filed a Second Amended Petition in Intervention, alleging it was entitled to the
fees because of the previous employment agreement and shareholder agreement between
appellee and appellant.  Appellant answered the Second Amended Intervention, realleging
his previous defenses and specifically alleging that any obligation he had under the
shareholder agreement to turn over any fees he earned ended when he was terminated
by appellee, and that there was a defect of parties because appellee had no claim against
appellant, and the plaintiffs had not been served.  The trial court proceeded to trial over
appellant's objections that he was not making a claim as a former employee, but as a
second lawyer who successfully concluded a case, and that the plaintiffs, the only parties
against whom appellee’s claim could have been made, had not been served and were not
properly before the court. Instead, the trial court dismissed the plaintiffs from the
intervention proceedings with a ruling that the appellee’s claim attached to the fund in the
registry of the court.  The interventions were tried and the jury answered the questions in
favor of appellee, except appellant was awarded $25,000.
Motion to Dismiss
          Appellee filed a motion to dismiss appellant's appeal as moot because appellant
accepted the $25,000 he was awarded by the trial court judgment. Appellant redeposited
the $25,000 plus interest after nine months.  Appellee did not change its position, nor was
it otherwise injured because of the withdrawal and redeposit.
          The acceptance of benefits of a judgment can only affect an appeal where it is
barred by an estoppel.  Carle v. Carle, 149 Tex. 469, 234 S.W.2d 1002, 1004 (Tex. 1950). 
The acceptance of the $25,000, which appellant would have been entitled to regardless
of the outcome of the appeal, did not create an estoppel, and was not unconscionable
even if appellant had not redeposited the $25,000.  Bristol-Myers Squibb Co. v. Barner, 
964 S.W.2d 299, 302 (Tex. App.–Corpus Christi 1998, no pet.)
          Appellee's motion to dismiss is overruled.
Standard of Review
          The standard of review for a trial court’s denial of a motion for judgment
notwithstanding the verdict is to determine whether the evidence conclusively proves a fact
that establishes a party’s right to a judgment as a matter of law.  Fort Bend County
Drainage Dist. v. Sbrusch, 818 S.W.2d 392, 394 (Tex. 1991).  If so, then the trial court
erred in denying the motion for judgment notwithstanding the verdict.  Id.
The judgment of the court shall conform to the pleadings, the nature of the
case proved and the verdict, if any, and shall be so framed as to give the
party all the relief to which he may be entitled either in law or in equity. 
Provided, that upon motion and reasonable notice the court may render
judgment non obstante veredicto if a directed verdict would have been
proper, and provided further that the court may, upon like motion and notice,
disregard any jury finding on a question that has no support in the evidence. 

Tex. R. Civ. P. 301.  
          The standard for reversible error in civil cases is provided in rule 44.1 of the
Texas Rules of Appellate Procedure as follows:
(a) Standard for reversible error. No judgment may be reversed on appeal
on the ground that the trial court made an error of law unless the court of
appeals concludes that the error complained of:

          (1) probably caused the rendition of an improper judgment; or
 
(2) probably prevented the appellant from properly presenting the case to the
court of appeals.

Tex. R. App. P. 44.1(a).
          The court on its own motion may disregard the jury’s answer to an immaterial
question.  Brown v. Armstrong, 713 S.W.2d 725, 728 (Tex. App.–Houston [14th Dist.]
1986, writ ref’d n.r.e.).
          To preserve appellate complaints, the record must show that 
 
(1) the complaint was made to the trial court by a timely request, objection
or motion that:
 
(A)  stated the grounds for the ruling the complaining party sought
from the trial court with sufficient specificity to make the trial court
aware of the complaint, unless the specific grounds were apparent
from the context; and 
 
(B) complied with the requirements of the Texas Rules of Civil or
Criminal Evidence or the Texas Rules of Civil or Appellate Procedure;
and 
 
(2) the trial court: 
 
(A) ruled on the request, objection or motion, either expressly or
implicitly; or 
 
(B) refused to rule on the request, objection or motion, and the
complaining party objected to the refusal.  

Tex. R. App. P. 33.1(a)(1)(2).

Motion to Strike Intervention
          Appellant filed a motion to strike appellee’s intervention, alleging that appellee had
no right to intervene because the contingent fee contract(s) appellee was claiming under
only constituted a contingent fee interest, not an assignment.  Appellee argues that the
language, “ . . . assigns .  .  . that portion of any final recovery realized or recovered by the
client which represents the attorney’s fee computed in accordance with this agreement,”
was an assignment.  Although a properly worded contingent fee contract may effect an
assignment,  Dow Chemical Co. v. Benton, 163 Tex. 477, 357 S.W.2d 565, 568 (1962),
the language in this case does not assign or transfer an interest in the cause of action or
subject matter.  Wheeler v. Fronhoff,  270 S.W. 887, 888 (Tex. Civ. App.–Texarkana 1925,
writ dism’d).  The language at issue in the Wheeler case, “[a]ppellants are to have one-third
of any sum of money or property, or both or either that may be recovered or paid as a
compromise of said suit for their services therein,” was held not to evidence an intent to
transfer the title to a cause of action, and the attorney was not entitled to intervene.  The
language in this case likewise does not evidence an intent to assign or transfer an interest
in a cause of action.  Assuming, arguendo, that the contingent fee contract was an
assignment of plaintiffs’ cause of action to appellee, appellee assigned its interest to
appellant upon appellant’s termination and the division of the client cases, and appellee
no longer would have had a justiciable interest in the matter.  See River Consulting, Inc.
v. Sullivan, 848 S.W.2d 165, 169 (Tex. App.–Houston [1st Dist.] 1992, writ. denied).
          Appellee admitted it had no claim or cause of action against appellant.  As a matter
of law, appellant’s contract with appellee, which is the basis of appellee’s claim for the
fees, terminated before appellant concluded the plaintiffs’ case, leaving appellee without
a justiciable interest, or an actual controversy with appellant.  Hanna v. Godwin, 876
S.W.2d 454, 457 (Tex. App.–El Paso 1944, no writ) (Texas courts only have power over
litigants with justiciable interests).  Appellee’s prayer for declaratory relief does not support
an action against appellant because it is merely a procedural device and does not create
any substantive rights or causes of action.  Sid Richardson Co. v. Interenergy Res. Ltd, 99
F.3d 746, 752 (5th Cir. 1996).  Appellee’s intervention petition alleges appellee was
discharged without good cause by the plaintiffs, and that plaintiffs breached their contract,
but alleges no cause of action against appellant.  Appellee could assert no claim against
plaintiffs as they had been dismissed from the intervention proceedings.  The trial court’s
dismissal of the plaintiffs and ruling that appellee’s invalid claim attached to the fund in the
registry of the court was an abuse of discretion because such action was without reference
to any guiding rules and principles.  McDaniel v. Yarborough, 898 S.W.2d 251, 253 (Tex.
1995).  The appellant reserved all  rights to the deposit by the provision in the judgment
which orders that he did not waive any position by agreeing to deposit the funds in the
registry of the court.
          Prior to the submission of the charge to the jury, appellant objected to the
submission of any issue on behalf of appellee on the grounds that appellee has no
standing to intervene because appellee was claiming under a contingent fee contract rather
than an assignment of a cause of action, and because there are no pleadings to support
any issue for any recovery on behalf of appellee. Appellant stated the same reasons  in his
motion to dismiss and his motion for directed verdict.  The trial court overruled all of
appellant’s objections.  The same substantive objections were made in appellant’s motion
for JNOV.
          The trial court implicitly overruled appellant’s motion to strike by proceeding to trial
and granting relief to appellee, Tex. R. App. P. 33.1(a)(2)(A), and expressly by the “Mother
Hubbard” order in the final judgment, which denied all relief not granted.  Lehmann v. Har-Con Corp., 39 S.W.3d 191, 193 (Tex. 2001).  As the appellee had no standing to intervene,
the trial court erred in overruling appellant’s motion to strike the intervention and in holding
that appellee’s claim attached to the fund in the registry of the court.  Tex. R. Civ. P. 60. 
          Had the appellee’s intervention pleadings been properly stricken by the trial court
as appellant requested in his motion to strike, there would have been no pleadings to
support or conform to the trial court judgment.  Tex. R. Civ. P. 301.  Although appellee
argues the procedure is similar to an interpleader action, it is not an interpleader because
the proceedings were instigated by the appellee, not the plaintiffs who held or had control
over the funds.  Appellee could not allege that it could or may be exposed to double or
multiple liability.  See Tex. R. Civ. P. 43.  Further, appellee, appellant, and the plaintiffs
could not have been stakeholders because in order to interplead, one must have no
interest in the subject matter of the litigation.  Taliferro v. Tex. Commerce Bank, 660
S.W.2d 151, 155 (Tex. App.–Fort Worth 1983, no writ).  The sole issue between appellee,
appellants and the plaintiffs would have been whether plaintiffs fulfilled their burden of
establishing that they are subjected to multiple liability.  Id.  The proceeding could not have
been an interpleader because the stakeholder must be a party to the proceedings, but
plaintiffs were dismissed by the court prior to the commencement of trial.  Maverick County
Water Control & Improv. Dist. v. Laredo, 346 S.W.2d 886, 889 (Tex. Civ. App.–San Antonio
1961, writ ref’d n.r.e.); 1 McDonald Texas Civil Practice § 5.64 (1992).  Also, another
requirement to an interpleader is that the funds be deposited unconditionally into the
registry of the court.  Tri State Pipe & Equip. v. S. Mut., 8 S.W.3d 394, 402 (Tex.
App.–Texarkana 1999, no pet.).  However, the deposit in this case was not unconditional
because it was made without any waiver of rights by the parties and there was no
disinterested party to qualify as a stakeholder. Taliferro, 660 S.W.2d at 153; 47 Tex.
Jur.3d Interpleader § 1 (1986).
          Except for the issue of attorney’s fees to be awarded pursuant to the Declaratory
Judgment Act,
 there was no necessity for a jury trial had the trial court granted appellant’s
motion to strike appellee’s intervention.  Appellant was entitled to the relief he sought as
a matter of law, there being no alleged claims or causes of action against him that 
obligated him to defend against or which raised a fact issue for the jury.  The status of the
plaintiffs’ case remains the same as before appellee tried to intervene.  The plaintiffs and
appellant who concluded their case were and are entitled to finally settle between them the
settlement funds without any interference from the appellee.
Issues Presented
          Appellant's issues numbers one and three claim the trial court erred  as a matter of
law by denying his motion for JNOV and motion for new trial because he was at all times
during the prosecution of the plaintiffs' case the lead attorney in charge who successfully
concluded the case pursuant to the intent and direction of the plaintiffs.  According to
appellant, he was entitled to the fee and expense deposit, notwithstanding appellee’s claim 
that appellant's rights were governed by his previous employment contract and shareholder
agreement, because appellee withdrew, abandoned, and/or was terminated from any
connection with the case prior to its conclusion.  Appellant's issue number two complains
that the trial court erred in allowing, over appellant's objection, evidence of appellant's
former employment status and the shareholder agreement, which led to the rendition of an
improper verdict.
          Was a division of fees prohibited after appellee terminated appellant?
          Appellant argues that rule 1.04 of The Texas Disciplinary Rules of Professional
Conduct prohibits a division of fees between appellee and appellant because (1) appellant,
who concluded the case pursuant to a contract with the clients, was not in the same firm,
i.e., appellee's firm; (2) the proposed division of fees was not in proportion to the
professional services performed by each lawyer nor was the division made with a
forwarding lawyer, or made by written agreement with the client with a lawyer who
assumed joint responsibility for the representation; and (3) the client was not advised of
the nature and extent of appellee’s participation and was not given the opportunity to object
to  appellee's participation.  We agree.  Appellant was terminated by appellee, but
continued to represent the plaintiffs in the case pursuant to plaintiffs’ request. Appellee
relinquished any claim it had to attorney's fees in the plaintiffs' case when it terminated
appellant and agreed that he take plaintiffs' case among other cases to handle without any
reservation of its rights as to fees or expenses.  Even if appellee believed the May 1997
letters from the Midwest attorneys meant it was discharged, such letters not only could not
have discharged appellee because appellee had already abandoned the case voluntarily
when it fired appellant and agreed to assign plaintiffs’ case to appellant and such letters
did not contain any language discharging appellee or requesting appellee’s withdrawal. 
The letters requested that appellant continue as counsel in the case he had worked on for
over ten years and that appellee release the file to appellant.  Further, the Midwest
attorneys testified they did not terminate or discharge appellee and had no intention to do
so, and appellee’s shareholders admitted they did not ask the Midwest attorneys if they
should consider themselves terminated.  Appellee’s response to the Midwest attorneys’ 
letters was merely a self-serving statement that it was “ready, willing and able,” and that
it agreed to turn over the file to appellant, and gave notice it was retaining “its fee interest.”
One of appellee’s shareholders told appellant the case was his sole responsibility.  
          Even if appellee’s intervention was proper, there was no evidence that the plaintiffs
discharged appellee, or requested appellee’s withdrawal, with or without just cause. 
Appellee failed its burden of proving just cause to withdraw.  See Augustson v. Linea Aerea
Nacional-Chile S.A., 76 F.3d 658, 663 (5th Cir. 1996).  There was no agreement that
appellee would share in any joint responsibility or fees with appellant or any other lawyer
after appellant was terminated by appellee.  Since the plaintiffs were not bound by the
terms and conditions of the employment contract between appellee and appellant, even
when appellant was employed by appellee, rule 1.04 prohibits any division of the fees in
question with appellee, but does not prevent appellant from recovering the fees he seeks
in this case because he continued the prosecution of the case with the knowledge and
consent of the plaintiffs and the Midwest attorneys, after he was fired by appellee.
          The appellee’s position is based on the employment contract and shareholder
agreement  to which appellant was bound from the time he signed the contingent fee
contracts until he was terminated by appellee in March 1997. However, upon appellant’s
termination: (1) he was no longer bound under the employment contract and shareholder
agreement; (2) appellant and appellee had no contractual obligation to each other to
continue the plaintiffs' case; (3) by agreement, appellee assigned to appellant all of its
rights and obligations to the plaintiffs’ cases, which included all the fees and expenses as
provided in the written contracts with the plaintiffs.  See Univ. of Tex. Med. Branch v. Allan,
777 S.W.2d 450, 453 (Tex. App.–Houston [14th Dist.] 1989, no writ) (“The assignor, after
an unqualified assignment and notice to the obligor, generally loses all control over the
chose, and can do nothing to defeat the rights of the assignee.” (Emphasis supplied)); (4)
no agreement was made which reserved any rights to appellee in the plaintiffs' case; (5)
with knowledge of appellant’s termination, plaintiffs affirmatively assented to appellant
continuing to represent them in their case for the one-third (1/3) contingent fee; (6)
appellant could not have divided the fees earned in the plaintiffs' case because: (a) he was
no longer a member of appellee's law firm, (b) no other attorney who was a member of
appellee's law firm performed any work in the plaintiffs' case after appellant was
terminated, and (c) appellee made no agreement with a forwarding lawyer or the clients
to divide the fees in return for appellee's agreement to assume joint responsibility  for the
representation;
 and (7) the agreement to the division of client cases and assignment was
an accord and satisfaction as the facts proved irresistibly point to such conclusion, see
Jenkins v. Henry C. Beck Co., 449 S.W.2d 454, 455 (Tex. 1969), and the accord and
satisfaction constitutes a bar to any action by appellee on its previous contracts with
appellant.  See Harris v. Rowe, 593 S.W.2d 303, 306 (Tex. 1979). The facts and
circumstances surrounding the execution of the new agreement are sufficient to establish
the existence of an accord and satisfaction.  Id. 
           Appellee's connection with the plaintiffs' case was effectively severed at the time
it terminated appellant, and assigned him the plaintiffs’ case and six other cases without
a reservation of rights therein.  Appellee withdrew from the plaintiffs' case without being
requested to do so by the plaintiffs.  Appellee wanted no responsibility for the case, and
made plans to claim the case as a  loss for tax purposes.  Appellee wanted to withdraw
after the unfavorable trial court judgment, but appellant objected and maintained the case
had merit.  Even if withdrawal for just cause was an issue, appellee's separation from the
plaintiffs' case was voluntary and without just cause.  See Royden v. Ardoin, 160 Tex. 338,
331 S.W.2d 206, 208 (1960) ("If an attorney, without just cause, abandons his client before
the proceeding for which he was retained has been conducted to its termination, or if such
attorney commits a material breach of his contract of employment, he thereby forfeits all
right to compensation." (Emphasis supplied)).  In any event, appellee failed to meet its
burden to prove its withdrawal was for just cause.  See Auguston, 76 F.3d at 662-63.  To
the contrary, as a matter of law, appellee cannot claim it withdrew for just cause after it
fired appellant, assigned him the case, and effected an accord and satisfaction without
reserving any responsibility or rights therein, filed a motion to withdraw without the
agreement of the clients with the belief the case had no value, and later, as an
afterthought, when it discovered the court of appeals reversed the case in favor of the
plaintiffs, tried to bootstrap its way back into the case in order to collect the contingent fee
without earning it.  Appellee had no justifiable cause to withdraw without plaintiffs' consent. 
Therefore, appellee has no right to recover any fees from plaintiffs, even if the plaintiffs
were parties to the intervention.  Appellee had no cause of action against appellant as
there was no existing contract between them.  Appellee having no interest in the plaintiffs'
case by contract, and no complaint against the plaintiffs, failed to allege any cause of
action against appellant which supports the judgment of the trial court.  Cunningham v.
Parkdale Bank, 660 S.W.2d 810, 813 (Tex. 1983) (a party may not be granted relief in
absence of pleading to support that relief); see also Tex. R. Civ. P. 301.  Appellee claims
its prayer for declaratory relief supports the judgment, but a declaratory judgment
proceeding is merely a procedural device and does not create any substantive rights or
causes of action.  Sid Richardson Co., 99 F.3d at 752.
          Therefore, the contracts between appellee and appellant, i.e., the employment
contract and shareholder’s agreement, are not relevant to any issue in this case, even
assuming  appellee’s intervention was properly before the court.  The trial court erred in
holding such contracts controlled the rights of appellee and appellant.  Appellant’s
objections to the trial of the case, the admission of evidence and submission of jury
questions on the basis such contracts were relevant and controlling, were proper objections
and were erroneously overruled by the trial court, thereby preserving error.  Appellant’s
motion for JNOV was erroneously overruled by the trial court.  Tex. R. App. R. 33.1(a)(1).
          The trial court should have dismissed appellee’s intervention and ordered that
plaintiffs and appellant were entitled to finally distribute the settlement funds pursuant to
their agreement without the necessity of intervention or other proceedings filed by appellant
or mere intermeddlers.  See Royden, 331 S.W.2d at 208; Augustson, 76 F.3d at 662.
          Appellant’s issue number one is granted.  Our disposition of issue number one
renders the other issues immaterial except appellant’s issue number five, which complains
he was not awarded the attorney’s fees as found by the jury in answer to jury question
number six.  We may ignore the immaterial jury questions as the trial court should have. 
Brown, 713 S.W.2d at 728.  By trying the case, admitting evidence of and about the
employment contract and shareholder agreement between appellee and appellant, and
submitting jury questions pursuant to appellee’s theory that it could rely on such contracts,
the trial court confused the jury and caused it to provide improper answers.  The jury
neither knew the legal effect of the terminated contracts nor that the contracts terminated
when appellant was fired by appellee.   We also grant appellant’s issue number five.
          On rehearing, appellant requests that the judgment be modified or clarified because
$651,525.89 of the original $676,535.89 which was on deposit in the registry of the court
was disbursed to appellee on April 2, 2001. The trial court originally granted appellant‘s
motion to prevent disbursement, but thereafter, in its December 20, 2000 judgment,
ordered the district clerk to immediately disburse the deposited funds. Appellant filed in this
Court on April 20, 2001, a motion for an emergency stay of execution of the trial court
judgment, but this motion was dismissed as moot on May 10, 2001.  
          Appellee claims the appellant’s pleadings only support a judgment for the deposited
fund, but not a judgment against the appellee for the amount of the fund. Appellant’s
Amended Conditional Petition in Intervention properly prayed for a superior interest in the
fund held in the registry of the court, and for such other and further relief as was
appropriate.  Tex. R. Civ. P. 47(c). Appellee waived any issue as to defective pleading by
failing to cite authorities to support its argument.  Tex. R. App. P. 38.1(g),(h).  Appellee only
cites this Court‘s opinion in the instant case for the general proposition that the judgment
must conform to the pleading, which is not controlling.  Tex. R. App. P. 38.1(h).  Moreover, 
when issues not raised by the pleadings are tried by express or implied consent of the
parties, they shall be treated in all respects as if they had been raised in pleadings. Tex.
R. Civ. P. 67.  Had appellee objected to appellant’s pleadings, appellant had the right to
make the necessary amendment. Id. 
          We reverse and render the judgment of the trial court because it made an error of
law which caused the rendition of an improper judgment. Tex. R. App. P. 43.3; 44.1(a)(1).
Judgment is rendered for appellant against appellee in the sum of $651,525.89, plus
interest at the rate of ten percent per annum from January 5, 1998, until the day preceding
the date the judgment is paid; see Tex. Fin. Code Ann. §§ 304.003-004, 304.104 (Vernon
Supp. 2003), and appellant shall have judgment against appellee in the sum of $70,000
as found by the jury for attorney fees, plus $5,000 if there is an appeal to the Texas
Supreme Court, and costs; and the appellee shall take nothing. In addition, the appellant
is immediately entitled to and shall have the $24,990 on deposit in the registry of the court
without any further court proceedings, and we order the clerk of the trial court to deliver
these funds to appellant.
 
________________________________
MAURICE AMIDEI,
Assigned Justice

Opinion delivered and filed
this 5th day of February, 2004.