Court Opinion

ID: 3103355
Source: CourtListenerOpinion
Date Created: 2015-10-16 05:28:19.724815+00
Date Added: 2024-06-11T12:05:38.843636
License: Public Domain

COURT OF APPEALS
EIGHTH DISTRICT OF TEXAS
EL PASO, TEXAS

YAGHOUB “JACOB” KOHANNIM, 

                            Appellant,

v.

PARVANEH KATOLI, 

                            Appellee.

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No. 08-11-00155-CV

Appeal from the

236th Judicial District Court

of Tarrant County, Texas 

(TC# 236-217944-06) 

MEMORANDUM  OPINION  ON  MOTION

            Pending before the Court is Appellant’s motion to review a trial court’s ruling regarding
suspension of a judgment pending appeal.
            Appellee sued Appellant and 360 Center, L.L.C. (the company).  On February 16, 2011,
the court signed the final judgment in the suit.  The judgment states that Appellant defrauded
Appellee and that but for Appellant’s wrongful acts and omissions, the value of Appellee’s
portion of the company’s assets would have been $418,761.06 more.  The court therefore
awarded Appellee $418,761.06 in compensatory damages from Appellant.  The court also
ordered Appellant to pay Appellee $150,000 in punitive damages and $165,533.93 in attorney’s
fees for services rendered through the end of trial.  The court gave Appellant a credit regarding
the damage awards for $2,400, a sum which he had previously deposited into the trust account of
Appellee’s attorneys.  The judgment bears interest at the rate of 5% per year.
            The court determined that the company had $1,445,969.26 in assets, consisting of
$1,393,469.26 in cash held by a receiver and a “rent judgment” in the amount of $52,500. 
Appellant and Appellee each have a 50% beneficial interest in the company’s assets, amounting
to $722,984.63 each.  In accordance with their beneficial interests, the court “allocated and
partitioned” the assets equally, giving each party $722,984.63.  Appellant is to receive his entire
interest in cash, whereas Appellee is to receive $670,484.63 in cash and the $52,500 rent
judgment.  The court ordered the receiver to transfer the rent judgment to Appellee
“immediately” and to deposit $670,484.63 into the registry of the court “to the benefit of
[Appellee] referencing this Final Judgment. . . .”  The court further ordered the receiver to
deposit the receivership’s remaining funds into the registry “to the benefit of [Appellant]
referencing this Final Judgment.”  Immediately following these provisions, the judgment states
that the funds in the court registry “shall be held in the Court Registry pending subsequent
distribution as contemplated herein.”  In accordance with these provisions, the receiver deposited
a total of $1,390,544.51 into the court registry—$670,484.63 for Appellee’s benefit and
$720,059.88 for Appellant’s benefit.

            Appellant appealed and, on March 15, 2011, filed a notice of deposit in lieu of
supersedeas bond, stating his intent to supersede the judgment with the $720,059.88 that the
receiver had deposited for his benefit into the court registry.  On April 19, 2011, Appellee filed a
motion for release of funds, seeking to obtain the entire $1,390,544.51 that the receiver had
deposited into the court’s registry.  She asserted that the final judgment effectively awarded the
entire sum to her.  In response, Appellant argued that the judgment had been superseded by his
notice of deposit in lieu of supersedeas bond.  However, Appellant stated that he would have no
objection to the release of the $670,484.63 deposited for Appellee’s benefit.
            The court held two hearings on Appellee’s motion, but took no evidence.  At the second
hearing, the court made an oral ruling that the entire $1,390,544.51 would be immediately
released to Appellee, but the court delayed signing an order to that effect so that Appellant could
seek relief from this Court.  Appellant then filed a motion for an emergency stay of the trial
court’s ruling and a motion to review the ruling.  We granted the stay, allowing the trial court to
sign a written order reflecting its oral ruling, but providing that the order would be stayed
immediately upon signing.  The trial court subsequently signed an order for release of funds,
directing the district clerk to convey all of the funds to Appellee.  The motion to review the
ruling is now ripe for consideration.

            A judgment debtor is generally entitled to supersede the judgment pending appeal,
thereby deferring payment until the appeal is decided.  See Miga v. Jensen, 299 S.W.3d 98, 100 
(Tex. 2009); see also Tex.R.App.P. 24.1(a).  To supersede the judgment, the judgment debtor
may file a bond or, in lieu of bond, may deposit money with the trial court clerk.  See
Tex.R.App.P. 24.1(a)(2), (3).  The amount of the bond or deposit depends on the type of
judgment.  For a money judgment, the bond or deposit “must equal the sum of compensatory
damages awarded in the judgment, interest for the estimated duration of the appeal, and costs
awarded in the judgment.”  Tex.R.App.P. 24.2(a)(1).  When the judgment is for the recovery of
an interest in personal property, the trial court will determine the amount of the bond or deposit,
but at a minimum the amount must equal the value of the property interest as of the date of the
judgment.  Tex.R.App.P. 24.2(a)(2)(B).  We review a trial court’s ruling regarding the
sufficiency of supersedeas for abuse of discretion.  FaulknerUSA, LP v. Alaron Supply Co., Inc.,
301 S.W.3d 345, 347 (Tex.App.--El Paso 2009, no pet.).
            Appellant argues that his notice of deposit in lieu of supersedeas bond effectively
adopted, as a cash deposit, the $720,059.88 that the receiver deposited into the court registry for
his benefit.  Appellee does not dispute that it is possible for a judgment debtor to supersede a
judgment by adopting funds already held in the court registry for the debtor’s benefit.  See In re
Levitas, No. 13-10-00345-CV, 2010 WL 2968189, at *3 (Tex.App.--Corpus Christi July 27,
2010, orig. proceeding)(mem. op.).  She argues, however, that Appellant could not supersede the
judgment in this fashion because the $720,059.88 has never belonged to him.  See In re Romero,
Gonzalez & Benavides, L.L.P., 293 S.W.3d 662, 663-64 (Tex.App.--San Antonio 2009, orig.
proceeding)(indicating that an appellant could not supersede the judgment with funds in the court
registry that had not been awarded to him).
            In Appellee’s view, the final judgment, when read in its entirety, effectively awarded
nothing to Appellant.  Although Appellee acknowledges that the final judgment allocated
$722,984.63 to Appellant when it partitioned the company’s assets, she contends that the
judgment “effectively eliminated the funds previously allocated to” Appellant when it awarded
her damages (both compensatory and punitive) and attorney’s fees against Appellant.  Appellee
emphasizes that the final judgment states that the funds were to be deposited into the court
registry, “pending subsequent distribution as contemplated herein.”  She seems to interpret this
language as meaning that the funds allocated to Appellant were to be used to pay the damages
and attorney’s fees.
            Whether a judgment is ambiguous is a question of law.  Shanks v. Treadway, 110 S.W.3d
444, 447 (Tex. 2003).  A judgment should be construed as a whole to harmonize and give effect
to the entire instrument.  Id.  If the judgment is unambiguous, the court must give effect to the
literal language used.  Id.  If the judgment is ambiguous, the court should review the record along
with the judgment to determine its meaning.  Id.
            Nothing in the final judgment supports Appellee’s interpretation.  The judgment
“allocated and partitioned” the company’s assets between Appellant and Appellee and expressly
orders that certain receivership funds be deposited into the court registry “to Appellant’s benefit.” 
The judgment does not state that this sum is to be used to offset Appellant’s liability for damages
and attorney’s fees.  At no point does the judgment even require Appellant to pay Appellee for
her share of the assets.  Instead, the judgment expressly orders the receiver to transfer the rent
judgment to Appellee and to deposit the cash into the court registry for the benefit of each party.
            We conclude that Appellant could designate the funds representing his share of the
company’s assets as a deposit in lieu of supersedeas bond.  Appellee suggests that even if the
Appellant could adopt his share of the company’s asset as a cash deposit, enforcement of the
judgment still was not suspended because $720,059.88 is insufficient to supersede the judgment. 
We disagree with this suggestion.
            First, a bond or deposit is not rendered invalid because it is too small.  See Delhi Gas
Pipeline Corp. v. Hassell, 730 S.W.2d 159, 161 (Tex.App.--Tyler 1987, no writ).  If Appellee
believed the amount was insufficient, she could have asked the trial court to increase the amount
of security.  See Tex.R.App.P. 24.3(a).  Enforcement of the judgment should have been
suspended upon the filing of the notice of deposit in lieu of supersedeas.  See Tex.R.App.P. 
24.1(f).
            Second, under the unique facts of this case, we conclude that the amount of the deposit is
sufficient.  It is undisputed that the court’s award of $418,761.06 in damages is a money
judgment within the meaning of Rule 24.2(a)(1).  Appellant does not dispute that the
$165,533.93 attorney’s fee award should be included within the amount that must be superseded. 
See Clearview Props., L.P. v. Prop. Tex. SC One Corp., 228 S.W.3d 262, 264 (Tex.App.--Houston [14th Dist.] 2007, no pet.)(per curiam order)(upholding order requiring attorney’s fee
award to be superseded partly because the parties’ contract provided that attorney’s fees would
constitute compensation).  But see PopCap Games, Inc. v. MumboJumbo, LLC, 317 S.W.3d 913,
914 (Tex.App.--Dallas 2010, no pet.)(holding, in a contract action, that attorney’s fees need not
be superseded because the parties’ contract did not specify that such fees would be an element of
compensation for a breach); Shook v. Walden, 304 S.W.3d 910, 913 (Tex.App.--Austin 2010, no
pet.)(same).  Although the parties also agree that interest should be calculated at 5% per year for
one year, they disagree as to whether interest should be calculated on the attorney’s fee award. 
For purposes of argument, we will adopt Appellee’s calculations and include interest on the
attorney’s fee award.  Thus, the amount required to supersede the money judgment is
$610,989.74, which is less than the $720,059.88 that Appellant effectively deposited into the
court registry.
            However, Appellee asserts that Appellant was also required to supersede the portion of
the judgment that allocated half of the company’s assets to her.  She characterizes this portion of
the judgment as a judgment for personal property.  Since its value was $722,984.63, Appellant’s
deposit would be insufficient if he were required to supersede this portion of the judgment.  But
Appellant has disclaimed any intent to appeal this portion of the judgment and he has agreed to
let Appellee recover this portion of the judgment immediately.  We therefore conclude that
Appellant is not required to post security regarding this portion of the judgment.  See Mudd v.
Mudd, 665 S.W.2d 128, 129-30 (Tex.App.--San Antonio 1983, no writ)(allowing judgment
debtor to supersede two distinct portions of a judgment).  But see Haney Elec. Co. v. Hurst, 608
S.W.2d 355, 356 (Tex.Civ.App.--Dallas 1980, no writ)(holding that a money judgment cannot be
partially superseded).
            Although this method of superseding the judgment may be unusual, it is important to note
that Appellee is not being deprived of any security to which she is entitled.  From the judgment
creditor’s perspective, the purpose of supersedeas is to ensure that the judgment can be collected
if it is affirmed on appeal.  FaulknerUSA, LP, 301 S.W.3d at 347.  Here, Appellee will
immediately receive what she characterizes as the personal property judgment, consisting of the
$52,500 rent judgment and $670,484.63 from the court registry.  As for the money judgment,
construing the facts and law most favorably to Appellee, Appellant was required to deposit funds
equaling the compensatory damages plus attorney’s fees through the end of trial and 5% interest
on both the compensatory damages and attorney’s fees for one year.  Under Appellee’s own
calculations, this totals only $610,989.74.  Thus, the money judgment is more than fully secured
by the $720,059.88, which is safely ensconced in the court registry.
            Appellant’s motion for review of the trial court’s ruling regarding supersedeas is granted. 
The trial court’s order for release of funds is reformed to allow the release of only the funds held
in the court registry for Appellee’s benefit.  Enforcement of the monetary portion of the judgment
is suspended pending appeal.

June 29, 2011
DAVID WELLINGTON CHEW, Chief Justice

Before Chew, C.J., McClure, and Rivera, JJ.