Court of Appeals
FIFTH DISTRICT OF TEXAS
Dallas, Texas
MOFFITT, CHARLES E. AND
MARTIN TRANSPORTATION SYSTEMS, INC.,
Appellants,
v.
VASQUEZ, ADELINA,
Appellee.
Appealed from the 44th District Court of Dallas
County, Texas, the Hon. Carlos R. Cortez, Presiding
BRIEF OF APPELLANTS CHARLES E. MOFFITT AND
MARTIN TRANSPORTATION SYSTEMS, INC.
MICHAEL P. SHARP
State Bar No. 00788857
CLAY A. COSSE
State Bar No. 24071246
FEE SMITH SHARP & VITULLO, LLP
Three Galleria Tower
13155 Noel Road, Suite 1000
Dallas, Texas 75240
Telephone: (972) 934-9100
Facsimile: (972) 934-9200
Attorneys for Appellants
ORAL ARGUMENT REQUESTED
5th Court of Appeals
FILED: 05/25/2011
In The
Lisa Matz, Clerk
No. 05-11-00359-CV
IDENTITY OF PARTIES AND COUNSEL
Appellants:
Charles E. Moffitt and
Martin Transportation Systems, Inc.
Appellants Moffitt’s and
Martin Transportation’s Trial
And Appellate Counsel:
Michael P. Sharp
Clay A. Cosse
Fee Smith Sharp & Vitullo, LLP
Three Galleria Tower
13155 Noel Road, Suite 1000
Dallas, TX 75240
Appellee:
Adelina Vasquez
Appellee’s Trial and
Appellate Counsel:
Niles Illich
Ben Abbott, P.C.
1934 Pendleton Drive
Garland, Texas 75041
i
REQUEST FOR ORAL ARGUMENT
Defendants/Appellants Charles E. Moffitt and Martin Transportation Systems, Inc.
respectfully request that oral argument be granted on this appeal.
ii
TABLE OF CONTENTS
IDENTITY OF PARTIES AND COUNSEL .................................................................................. i
REQUEST FOR ORAL ARGUMENT .......................................................................................... ii
TABLE OF CONTENTS .............................................................................................................. iii
INDEX OF AUTHORITIES.......................................................................................................... iv
STATEMENT OF THE CASE .......................................................................................................1
ISSUES PRESENTED ...................................................................................................................2
STATEMENT OF FACTS ............................................................................................................2
SUMMARY OF ARGUMENT .....................................................................................................8
ARGUMENT .................................................................................................................................9
A.
STANDARD FOR RESTRICTED APPEAL .........................................................9
B.
ISSUE 1: THE TRIAL COURT ERRED IN ITS DAMAGE AWARD, AS
THE
EVIDENCE
WAS
LEGALLY
AND
FACTUALLY
INSUFFICIENT TO SUPPORT THE AWARDED AMOUNT OF
FUTURE MEDICAL EXPENSES, PAST PHYSICAL PAIN AND
MENTAL ANGUISH, FUTURE PHYSICAL PAIN AND MENTAL
ANGUISH, PAST PHYSICAL IMPAIRMENT AND FUTURE
PHYSICAL IMPAIRMENT................................................................................ 10
1.
Unsupported Damages for Future Medical Bills ......................................12
2.
Unsupported Damages for Past Physical Pain and Mental Anguish ........14
3.
Unsupported Damages for Future Physical Pain and Mental Anguish .....16
4.
Unsupported Damages for Past Physical Impairment ..............................17
5.
Unsupported Damages for Future Physical Impairment ...........................20
iii
C.
ISSUE 2: THE TRIAL COURT ERRED IN RULING THAT
DEFENDANTS/APPELLANTS WERE PROPERLY SERVED, THAT
DEFENDANTS/APPELLANTS HAD NOTICE OF THE DEFAULT
JUDGMENT HEARING, AND THAT THE POST-TRIAL MOTIONS FOR
NEW TRIAL AND TO VACATE JUDGMENT WERE UNTIMELY, AS THE
EVIDENCE WAS LEGALLY AND FACTUALLY INSUFFICIENT TO
SUPPORT THE RULINGS ...................................................................................23
PRAYER ......................................................................................................................................32
CERTIFICATE OF SERVICE ....................................................................................................33
APPENDIX ..................................................................................................................................34
1.
Default Judgment Dated October 28, 2010 (CR at 29).
2.
Final Default Judgment Dated November 19, 2010 (CR at 53).
3.
Order Denying Defendants’ Motion for New Trial and to Vacate Default
Judgment (CR at 335).
4.
Transcript of Default Proveup Hearing on November 19, 2010 (RR at Vol. 2).
5.
Transcript of Hearing on Defendants’ Motion for New Trial and to Vacate Default
Judgment on March 15, 2010 (RR Vol. 3).
6.
Texaco, Inc. v. Phan, 137 S.W.3d 763 (Tex. App.—Houston [1st Dist.] 2004, no
pet.).
7.
Texas Rule of Civil Procedure 306a.
iv
INDEX OF AUTHORITIES
CASES
Alexander v. Lynda's Boutique,
134 S.W.3d 845 (Tex.2004)...............................................................................................20
Anchor Casualty Company v. Crisp,
346 S.W.2d 364 (Tex.Civ.App.--Amarillo 1961, no writ) ...............................................25
Argyle Mechanical, Inc. v. Unigus Steel, Inc.,
156 S.W.3d 685 (Tex. App.—Dallas 2005, no pet.) ........................................................... 8
Brookshire Bros., Inc. v. Lewis,
997 S.W.2d 908 (Tex. App.—Beaumont 1999, pet. denied) .............................................12
Cliff v. Huggins,
724 S.W.2d 778 (Tex. 1987)............................................................................................ 25
Cordero v. Am. Home Assurance Co.,
281 S.W.3d 13 (Tex. App.—El Paso 2005, no pet.) ......................................................... 20
Craddock v. Sunshine Bus Lines,
133 S.W.2d 124 (Tex. 1939)................................................................................... 3, 26, 27
Dickerson & Mack Financial Corp.,
452 S.W.2d 552 (Tex. App.—Houston [1st Dist.] 1969, writ ref’d n.r.e.) .......................... 3
Director State Employees Workers’ Comp. Div. v. Evans,
889 S.W.2d 266 (Tex. 1994)............................................................................................. 26
EMC Mort. Corp. v. Jones,
252 S.W.3d 857 (Tex. App.—Dallas 2008, no pet.) ......................................................... 13
Estrada v. Dillon,
44 S.W.3d 558 (Tex. 2001)............................................................................................... 15
Garza v. Alviar,
395 S.W.2d 821 (Tex. 1965)............................................................................................... 9
Gold v. Gold,
145 S.W.3d 212 (Tex. 2009)............................................................................................... 7
Golden Eagle Archery, Inc. v. Jackson,
116 S.W.3d 757, 772 (Tex. 2003) ......................................................................... 15, 16, 17
v
Gulf Ins. Co. v. Cherry,
704 S.W.2d 459 (Tex. App. 1986) .................................................................................... 23
HCRA of Tex., Inc. v. Johnston,
178 S.W.3d 861 (Tex. App.—Fort Worth 2005, no pet.) ........................................... 12, 14
Hicks v Ricardo,
834 S.W.2d 587 (Tex App.—Houston [1st Dist.] 1992, no writ) ..................................... 13
Holt Atherton Indus., Inc. v. Heine,
835 S.W.2d 80 (Tex.1992)........................................................................................ 8, 9, 18
Hot Shot Messenger Serv., Inc. v. State,
798 S.W.2d 413 (Tex. App.—Austin 1990, writ denied) ................................................. 22
In re E.K.N.,
24 S.W.3d 586, (Tex. App.—Fort Worth 2000, no pet.) .................................................... 7
In Re R.R. and S.J.S, Children,
209 S.W.3d 112 (Tex. 2006) ...............................................................................................3
Jackson v. Gutierrez,
77 S.W.3d 898 (Tex. App. —Houston [14th Dist.] 2002, no pet.) ............................. 10, 15
Larson v. Cactus Util. Co.,
730 S.W.2d 640 (Tex.1987).......................................................................................... 9, 18
Lee v. Andrews,
545 S.W.2d 238 (Tex. Civ. App.—Amarillo 1976, writ dism’d) ..................................... 10
Maritime Overseas Corp. v. Ellis,
971 S.W.2d 402 (Tex. 1998), cert. denied, 525 U.S. 1017 (1998) ..................................... 9
Morgan v. Compugraphic Corp.,
675 S.W.2d 729 (Tex. 1984)............................................................................................... 7
Norman Commc’ns v. Tex. Eastman Co.,
955 S.W.2d 269 (Tex. 1997)................................................................................................7
Parkway Co. v. Woodruff,
901 S.W.2d 434 (Tex.1995).............................................................................................. 13
Peter v. Ogden Ground Serv., Inc.,
915 S.W.2d 648 (Tex. App. —Houston [14th Dist.] 1996, no writ) .................... 15, 16, 17
Pilgrim's Pride Corp. v. Soak,
134 S.W.3d 880 (Tex. App. —Texarkana 2004, pet. Denied) ......................................... 11
vi
Plainview Motels, Inc. v. Reynolds,
127 S.W.3d 21 (Tex. App.—Tyler 2003, pet. denied)................................................ 15, 17
Pope v. Moore,
711 S.W.2d 622 (Tex. 1986)............................................................................................... 9
Rodriguez-Narre v. Riding,
19 S.W.3d 531 (Tex. App.—Fort Worth 2000, no pet.) ................................................... 10
Sanmina-SCI Corp. v. Osborn,
153 S.W.3d 639 (Tex. App.—Dallas 2004, pet. denied) .................................................. 11
Schindler Elevator Corp. v. Anderson,
78 S.W.3d 392 (Tex. App.—Houston [14th Dist.] 2001, judgm't vacated) ..................... 15
Sherman v. First Nat’l Bank,
760 S.W.2d 240, 242 (Tex. 1988)....................................................................................... 9
Strahan v. Davis,
872 S.W.2d 828 (Tex. App.—Waco 1994, writ denied) .................................................. 13
Texaco, Inc. v. Phan,
137 S.W.3d 763 (Tex. App.—Houston [1st Dist.] 2004, no pet.) ..................21, 22, 23, 24
Torrington Co. v. Stutzman,
46 S.W.3d 829, 851 (Tex.2000) ..........................................................................................9
Walker v. Ricks,
101 S.W.3d 740 (Tex. App.—Corpus Christi 2003, no pet.) ........................................... 10
RULES
Texas Rule of Civil Procedure 306a .................................................................5, 20, 21, 22, 24, 35
Texas Rule of Appellate Procedure 30 ...................................................................................6, 7, 8
vii
STATEMENT OF THE CASE
Plaintiff/Appellee Adelina Vasquez (hereinafter, “Plaintiff/Appellee” or “Vasquez”) filed
a personal injury lawsuit as the result of her automobile collision with the vehicle owned by
Defendant/Appellant Martin Transportation Systems, Inc. (hereinafter, “Martin”) and driven by
Defendant/Appellant Charles E. Moffitt (hereinafter, “Moffitt”). On October 28, 2010, the
Honorable Carlos R. Cortez of the 44th Judicial District Court of Dallas County, Texas entered a
no-answer default judgment against Moffitt. (CR at 29) (Appendix Tab 1). On November 19,
2010, the Associate Judge of the 44th Judicial District Court of Dallas County, Texas, the
Honorable Sheryl McFarlin entered a second no-answer default judgment against Martin and
Moffitt that set forth damages in the amount of $799,368. (CR at 53.) (Appendix Tab 2.)
Defendants/Appellants filed Original and Amended Motions for New Trial and to Vacate Default
Judgment, as well as an Amended Memorandum, Second Amended Brief and Third
Supplementary Brief in support thereof. (CR at 75-153, 217-288, 327-334.) On March 15,
2011, Judge Cortez ruled that Moffitt and Martin were timely and properly served and that the
Motions for New Trial and to Vacate Judgment were not timely filed. (CR at 335.) (Appendix
Tab 3.)
This is a restricted appeal from the default judgments of October 28, 2010 and November
19, 2010 and from the trial court’s subsequent denial of Defendants/Appellants’ post-trial
motions on grounds that they were untimely. Defendants/Appellants timely filed their Notice of
Appeal on March 28, 2011. (CR at 377-378).
‒1‒
ISSUES PRESENTED
ISSUE 1:
The trial court erred in its damage award, as the evidence was legally and factually
insufficient to support the awarded amount of future medical expenses, past physical pain and
mental anguish, future physical pain and mental anguish, past physical impairment and future
physical impairment.
ISSUE 2:
The trial court erred in ruling that Defendants/Appellants were properly served, that
Defendants/Appellants had notice of the default judgment hearing, and that the post-trial
Motions for New Trial and to Vacate Judgment were untimely, as the evidence was legally and
factually insufficient evidence to support the rulings.
STATEMENT OF FACTS
1.
On or about February 23, 2010, Plaintiff/Appellee was traveling westbound on
I30 at RL Thornton and Dalrock in Dallas County, Texas. Moffitt was traveling westbound on
I30 in the lane adjacent to Plaintiff/Appellee. Plaintiff alleges Moffitt made an unsafe lane
change that resulted in his vehicle striking her vehicle. (CR at 12).
2.
Moffitt asserts his vehicle did not collide with Plaintiff’s/Appellee’s vehicle,
Plaintiff/Appellee instead struck a concrete divider in the roadway, Moffitt took no unsafe action
prior to Plaintiff’s/Appellee’s vehicle’s collision with the concrete divider, Moffitt was not cited
for the collision, Moffitt’s vehicle sustained no damage, Moffitt did not cause the subject
collision, and Plaintiff/Appellee sustained no injuries during the subject accident. (CR at 278279.)
3.
Plaintiff/Appellee filed suit on or about June 16, 2010, alleging Moffitt was
negligent in the operation of his vehicle, alleging Martin negligently entrusted its owned vehicle
‒2‒
to Moffitt, and alleging Martin was liable under the doctrine of respondeat superior because
Moffitt was acting as Martin’s agent at the time of the collision in question. The suit sought
recovery of monetary damages for the past and future physical pain and mental anguish, past and
future medical expenses and past and future physical impairment resulting from the personal
injuries Plaintiff/Appellee allegedly sustained in the collision. (CR at 12-13.)
4.
Plaintiff/Appellee served Martin through the office of the Texas Secretary of
State. (CR at 16.) There is no evidence in the record that Plaintiff/Appellee made any effort to
serve Martin’s in-state registered agent for service of process. After being notified of the claims,
Martin forwarded the matter to its third-party administrator, Gallagher Bassett Services
(hereinafter, “GBS”) for claims handling and referral to defense counsel. (CR at 96-97.) GBS,
however, has no record that the Plaintiff’s Petition went through its litigation intake process.
(CR at 100.)
5.
Plaintiff attempted personal service upon Moffitt. (CR at 18.) Moffitt testified
that a copy of the suit was left with someone at his former residence, but that he never personally
was served with a copy of Plaintiff’s suit. (CR at 279.)
6.
On or about October 28, 2010, the Honorable Carlos R. Cortez of the 44th Judicial
District Court of Dallas County, Texas entered a no-answer default judgment against Moffitt.
(CR at 29.) (Appendix Tab 1.) The judgment did not contain damages and was therefore
interlocutory. In Re R.R. and S.J.S, Children, 209 S.W.3d 112, 114-15 (Tex. 2006) (citing
Craddock v. Sunshine Bus Lines, 133 S.W.2d 124, 126 (Tex. 1939)). See also Dickerson &
Mack Financial Corp., 452 S.W.2d 552, 554-56 (Tex. App.—Houston [1st Dist.] 1969, writ ref’d
n.r.e.).
7.
When on November 12, 2010, the undersigned defense counsel received the
assignment to represent Defendants/Appellants, the October 28, 2010 default judgment had
‒3‒
already been entered as a result of the faulty personal service upon Moffitt and the unintentional
error by GBS in processing Martin’s claim. During a November 15, 2010 telephone conference,
defense counsel Clay Cosse requested that Plaintiff’s counsel voluntarily set aside the default
judgment; Plaintiff’s counsel Jennifer Kashar agreed to do so in exchange for payment of $1,500
in attorneys’ fees. Defense counsel agreed to pay $750.00 in attorneys’ fees. Plaintiff’s counsel
agreed to discuss the counter-offer with Plaintiff’s counsel Ben Abbott. Plaintiff’s counsel
responded on November 23, 2010 that Plaintiff would no longer agree to set aside the default
judgment. Defense counsel renewed his request that the default be voluntarily set aside in
exchange for reimbursement of reasonable attorneys’ fees. On behalf of Plaintiff, Ms. Kashar
again agreed to discuss the matter with Plaintiff’s counsel Ben Abbott, but never responded. (CR
at 275-276.) (RR at 3:9-13.)
8.
In the meantime, during the course of ongoing settlement discussions between
Plaintiff’s and Defendants’ counsel, Plaintiff’s counsel sought and obtained a second default
judgment without providing any notice whatsoever to Defendants’ counsel. A mere four days
after agreeing to voluntarily set aside the October 28, 2010 default judgment and agreeing to
discuss and consider the settlement amount offered by Defendants, Plaintiff’s counsel violated
the Texas Attorney’s Creed provision that an attorney shall not take a default judgment, when
knowing the identity of an opposing party’s counsel, without first inquiring of counsel whether
counsel intends to proceed. (CR at 244.) (RR at 3:9-13.)
Plaintiff’s counsel further violated
Rule 4.02 of the Rules of Professional Conduct, requiring that an attorney to communicate
through legal counsel when the attorney knows a party is represented. (RR at 3:15.)
9.
On or about November 19, 2010, the trial court, under Associate Judge the
Honorable Sheryl McFarlin, entered a second no-answer default judgment against Martin and
Moffitt that set forth damages in the amount of $799,368, based on only roughly $14,000 in
‒4‒
documented medical expenses. (CR at 53.) (Appendix Tab 2.) Plaintiff testified that she would
need $85,000 in future medical expenses, but her self-serving lay testimony is not supported by
any competent medical evidence and is insufficient to establish that such expenses will be
reasonable or necessary. (RR at 2:20.)
10.
Neither Martin nor Moffitt nor counsel for Appellants/Defendants appeared at
either the October 28, 2010 or the November 19, 2010 default judgment hearings or received
notice of the default judgments within 20 days of the dates the orders were signed. (CR at 97,
109, 279.) Despite participating in ongoing settlement conversations with defense counsel,
Plaintiff’s counsel never provided Defendants or their counsel with notice of the November 19,
2010 hearing or with notice of the final default judgment entered on that date. (CR at 276.)
Martin first received notice of the final, appealable default judgment on February 4, 2011, 77
days after the judgment was entered, when defense counsel checked the trial court’s online
record and then notified Martin of the default judgment. (CR at 97, 109.) Moffitt first learned of
the default judgment on February 28, 2011, when defense counsel informed him of same during
a telephone call. (CR at 279.)
11.
On or about February 7, 2011, pursuant to Texas Rule of Civil Procedure 306a(4)
and within the 30-day time period after receiving actual notice of the default judgment (and
before receiving actual notice in Moffitt’s case), Defendants/Appellants filed a Motion for New
Trial and to Vacate Default Judgment. (CR at 75-110.) Defendants/Appellants subsequently
filed an Amended Motion for New Trial and to Vacate Default Judgment, as well as an Amended
Memorandum, Second Amended Brief and Third Supplemental Brief in support thereof. (CR at
111-153, 217-288, 327-334.)
‒5‒
12.
At the March 15, 2011 hearing on the post-trial Motions, Judge Cortez ruled that
Moffitt and Martin were timely and properly served and that the Motions for New Trial and to
Vacate Judgment were not timely filed. (CR at 335.) (Appendix Tab 3.)
13.
This is a restricted appeal from the default judgments of October 28, 2010 and
November 19, 2010 and from the trial court’s subsequent denial of Defendants/Appellants’ posttrial motions on grounds that they were untimely.
Pursuant to Texas Rule of Appellate
Procedure 30, Defendants/Appellants timely filed their Notice of Appeal on March 28, 2011.
(CR at 377-378.)
SUMMARY OF ARGUMENT
The Trial Court erred in entering the default judgment, in the amount of unliquidated
damages awarded, and in denying and ruling untimely the post-trial motions filed by
Defendants/Appellants. Specifically:
1.
The evidence was legally and factually insufficient to support the trial court’s
damage award in this cause. Consisting solely of the uncorroborated and speculative oral
testimony of Plaintiff/Appellee, the face of the record reveals nonexistent or insufficient
evidence to support the trial court’s monetary damage awards for future medical expenses, past
physical pain and mental anguish, future physical pain and mental anguish, past physical
impairment and future physical impairment. Defendants/Appellants seek a reversal and remand
for new trial on the damages awarded in this matter. In the alternative, Defendants/Appellants
seek a remittitur of the damage amount awarded.
2.
The trial court erred in ruling Defendants’/Appellants’ Motion for New Trial and
to Vacate Judgment was untimely.
Evidence of proper notice of the default judgment to
Defendants/Appellants was legally and factually insufficient; had the trial court properly
considered the Motion for New Trial and to Vacate Judgment, the default judgment would have
‒6‒
been set aside because Defendants/Appellants satisfied the Craddock requirements.
Defendants/Appellants seek to set aside the trial court’s default judgment. In the alternative,
Defendants/Appellants seek a reversal of the trial court’s timeliness ruling and a remand for
proper consideration of their Motion for New Trial and to Vacate Judgment.
ARGUMENT
A.
STANDARD FOR RESTRICTED APPEAL
A restricted appeal directly attacks a trial court’s judgment and affords an appellant a
review of the entire case in the same manner as does an ordinary appeal. In re E.K.N., 24
S.W.3d 586, 590 (Tex. App.—Fort Worth 2000, no pet.). A restricted appeal must meet the
following four requirements: (1) It must be brought within six months after the trial court signs
the judgment; (2) It must be asserted by a party to the underlying suit; (3) The asserting party
must not have participated in the actual trial; and (4) The error complained of must be apparent
from the face of the record. See TEX. R. APP. P. 30; Gold v. Gold, 145 S.W.3d 212 (Tex. 2009);
Norman Commc’ns v. Tex. Eastman Co., 955 S.W.2d 269, 270 (Tex. 1997); E.K.N., 24 S.W.3d
at 590.
For the purposes of a restricted appeal, the “face of the record” consists of all the
papers on file in the appeal, including the reporter’s record. Norman Commc’ns, 955 S.W.2d at
270. An appellate court’s review thus covers legal and factual sufficiency claims, including the
amount of damages awarded. See id.; Morgan v. Compugraphic Corp., 675 S.W.2d 729, 731-32
(Tex.1984). Texas Rule of Appellate Procedure 30 also requires that a party may file a restricted
appeal only if it did not “timely file a postjudgment motion…” TEX. R. APP. P. 30.
Defendants/Appellants clearly meet the first three of the four stated criteria required for a
restricted appeal: (1) Defendants/Appellants brought this restricted appeal on March 28, 2011,
within six months of the October 28, 2010 and November 19, 2010 default judgments
complained of herein (CR at 377-78); (2) Defendants/Appellants were the named Defendants in
‒7‒
the underlying suit (CR at 11); and (3) Defendants/Appellants did not participate in either default
judgment hearing (Reporter’s Record, hereinafter “RR” at 2:2).
The fourth requirement, error
apparent from the face of the record, is established herein by the evidence and discussion
appearing in Issues 1, 2 and 3 below; specifically, that the evidence of proper notice to
Defendants/Appellants was legally and factually insufficient to support default judgment, that the
evidence was legally and factually insufficient to support the trial court’s damage award, and that
the trial court erred in ruling untimely and refusing to review Defendants’/Appellants’ Motion
for New Trial and to Vacate Judgment. Moreover, because the trial court ruled that
Defendants’/Appellants’ post-trial Motions for New Trial and to Vacate Judgment were
untimely, Defendants/Appellants thus satisfy the requirements of Texas Rule of Appellate
Procedure 30 regarding timely-filed post-judgment motions and are entitled to file this restricted
appeal.
B.
APPEAL ISSUE 1:
THE TRIAL COURT ERRED IN ITS DAMAGE AWARD, AS THE EVIDENCE
WAS LEGALLY AND FACTUALLY INSUFFICIENT TO SUPPORT THE
AWARDED AMOUNT OF FUTURE MEDICAL EXPENSES, PAST PHYSICAL
PAIN AND MENTAL ANGUISH, FUTURE PHYSICAL PAIN AND MENTAL
ANGUISH, PAST PHYSICAL IMPAIRMENT AND FUTURE PHYSICAL
IMPAIRMENT.
The trial court’s November 19, 2010 default judgment order awarded unliquidated
damages to Plaintiff/Appellee in the total amount of $799,368, apportioned as follows: $14,368
for past medical bills; $85,000 for future medical bills; $100,000 for past physical pain and
mental anguish; $300,000 for future physical pain and mental anguish; $100,000 for past
physical impairment; and $200,000 for future physical impairment. (CR at 53.) (Appendix Tab
2.)
Defendants’/Appellants’ failure to answer does not operate as an admission as to the
amount of damages. Holt Atherton Indus., Inc. v. Heine, 835 S.W.2d 80, 83 (Tex.1992); Argyle
‒8‒
Mechanical, Inc. v. Unigus Steel, Inc., 156 S.W.3d 685, 687 (Tex. App.—Dallas 2005, no pet.).
Thus, the trial court’s damage award is subject to legal and factual sufficiency challenges on
appeal.
In deciding a legal sufficiency or a “no evidence” challenge, Texas appellate courts
should consider only the evidence and inferences which, when viewed in the light most favorable
to the judgment, tend to support the judgment, and disregard all evidence and inferences to the
contrary. Legal sufficiency challenges or “no evidence” points of error will be overruled if more
than a scintilla of evidence supports the finding. Holt Atherton, 835 S.W.2d at 84; Sherman v.
First Nat’l Bank, 760 S.W.2d 240, 242 (Tex. 1988).
An assertion that the evidence is factually insufficient to support a fact finding means that
the evidence supporting the finding is so weak or the evidence to the contrary is so
overwhelming that the answer should be set aside and a new trial ordered. Garza v. Alviar, 395
S.W.2d 821, 823 (Tex. 1965). Texas appellate courts are required to consider all of the evidence
in the case in making a factual sufficiency determination, not just the evidence that supports the
finding. Maritime Overseas Corp. v. Ellis, 971 S.W.2d 402, 406-07 (Tex. 1998), cert. denied,
525 U.S. 1017 (1998).
In determining whether damages are excessive, the court must apply the same test as for
any factual insufficiency question, examining all the evidence in the record to determine whether
sufficient evidence supports the damage award, remitting only if some portion is so factually
insufficient or so against the great weight and preponderance of the evidence as to be manifestly
unjust. Torrington Co. v. Stutzman, 46 S.W.3d 829, 851 (Tex.2000); Larson v. Cactus Util. Co.,
730 S.W.2d 640, 641 (Tex.1987). Appellate courts need not find passion, prejudice, or other
improper motive on the factfinder’s part to order a remittitur. Pope v. Moore, 711 S.W.2d 622,
624 (Tex. 1986). A remittitur is appropriate when: “(1) the verdict is shown to be the product of
‒9‒
passion, prejudice or other improper motive; (2) the amount fixed was not the result of a
deliberate and conscientious conviction in the minds of the jury; or (3) it shocks the conscience
of the court.” Lee v. Andrews, 545 S.W.2d 238, 248 (Tex. Civ. App.—Amarillo 1976, writ
dism’d) (citing J. C. Penney Company v. Duran, 479 S.W.2d 374 (Tex.Civ.App.—San Antonio
1972, writ ref'd n.r.e.), Structural Metals, Inc. v. Impson, 489 S.W.2d 740 (Tex.Civ.App.—
Corpus Christi 1972, no writ), McIver v. Gloria, 140 Tex. 566, 169 S.W.2d 710 (1943), Texas
Consolidated Transportation Co. v. Eubanks, 340 S.W.2d 830 (Tex.Civ.App.—Waco 1960, writ
ref'd n.r.e.)).
Defendants/Appellants appeal the damages awarded to Plaintiff/Appellee. The evidence
apparent on the face of the record is legally and factually insufficient to support the trial court’s
damage award, as follows:
1.
Unsupported Damages for Future Medical Bills
The trial court awarded Plaintiff/Appellee $85,000 for future medical expenses. (CR at
53.) (Appendix Tab 2.) A claim for medical expenses must be supported by evidence that such
expenses were reasonably necessary for the plaintiff to incur as a result of her injuries. See, e.g.,
Jackson v. Gutierrez, 77 S.W.3d 898, 902 (Tex. App.—Houston [14th Dist.] 2002, no pet.),
Walker v. Ricks, 101 S.W.3d 740, 746 (Tex. App.—Corpus Christi 2003, no pet.). A plaintiff
may prove that medical expenses are reasonable and necessary by: (1) presenting expert
testimony on the issues of reasonableness and necessity; or (2) presenting an affidavit prepared
and filed in compliance with section 18.001 of the Texas Civil Practice and Remedies Code.
Jackson, 77 S.W.3d at 902; Rodriguez-Narre v. Riding, 19 S.W.3d 531, 532 (Tex. App.—Fort
Worth 2000, no pet.).
‒10‒
The only evidence appearing on the face of the record with regard to future medical bills
is the testimony by Plaintiff/Appellee that she had talked with a doctor about getting additional
injections in her back and possibly needing surgery on her back:
Q:
A:
Q:
A:
Q:
A:
Q:
A:
Q:
A:
And do you have an idea of how much your medical treatment in the future
is going to be?
No.
At some point you’ve talked to your doctor about getting injections?
Yes.
And getting surgery?
Yes.
What is your understanding of how much the future medical bills would be
for that?
I don’t know. He is a specialist, but he told me that he was going to start
with injections. Then if the injections doesn’t [sic] work, then we will talk
about surgery on my back.
So you are going to ask the Judge to set aside $85,000 for your future medical
care?
Yes.
(RR at 2:20.) In addition to the fact that such out-of-court statements by an unidentified,
unspecified doctor are inadmissible hearsay, Plaintiff/Appellee testified that she has no idea of
what her future medical treatment could cost. (RR at 2:20.) Counsel for Plaintiff/Appellee led
the witness in his examination, and Plaintiff/Appellee asked for $85,000 for future medical care
without relying upon any evidence whatsoever in arriving at that number. (RR at 2:20.) The
record contains no expert or other testimony on the issue of the amount of reasonable and
necessary future medical expenses.
The evidence regarding future medical expenses consists solely of unsupported testimony
by Plaintiff/Appellee. Such testimony is speculative at best and provides no evidentiary basis
whatsoever for the damage amount awarded.
A plaintiff bears the burden of showing a
reasonable probability that medical expenses will be incurred in the future. Sanmina-SCI Corp.
v. Osborn, 153 S.W.3d 639, 642 (Tex. App.—Dallas 2004, pet. denied). To be probable, the
expenses must be more likely than not to occur. Pilgrim's Pride Corp. v. Soak, 134 S.W.3d 880,
‒11‒
905 (Tex. App.—Texarkana 2004, pet. denied). Plaintiff’s/Appellee’s testimony that surgery
may be required in the future is not testimony that it is more than likely to occur. Thus, the
evidence in the record relating to future medical expenses is insufficient and the damage award is
unsupported.
2.
Unsupported Damages for Past Physical Pain and Mental Anguish
The trial court awarded Plaintiff/Appellee $100,000 in damages for her past physical pain
and mental anguish. (CR at 53.) (Appendix Tab 2.) In challenging a multi-element damage
award on appeal, Defendants/Appellants must address each of the elements and show the
evidence is insufficient to support the entire damage award. See Brookshire Bros., Inc. v. Lewis,
997 S.W.2d 908, 922 (Tex. App.—Beaumont 1999, pet. denied). The trial court’s award of
$100,000 for both “past physical pain and mental anguish,” is excessive and unsupported by the
evidence in the record.
At the November 19, 2010 hearing, Plaintiff/Appellee testified that she had experienced
pain ever since the subject collision, and rated the pain as a level 8 on a scale of 1 to 10. (RR at
2:20-21.) Although a plaintiff’s own testimony can be used as evidence of the existence of past
physical pain, “[t]he duration of the pain … is an important consideration.” HCRA of Tex., Inc.
v. Johnston, 178 S.W.3d 861, 871 (Tex. App.—Fort Worth 2005, no pet.). Plaintiff’s/Appellee’s
alleged past physical pain lasted a maximum duration of the nine months that expired between
the February 23, 2010 date of the subject collision and the November 19, 2010 default judgment
hearing.
Although
the
trial
court’s
$100,000
damage
award
included
damages
for
Plaintiff’s/Appellee’s past mental anguish, there is absolutely no evidence in the record of any
past mental anguish suffered by Plaintiff/Appellee as a result of the subject collision. For an
award of mental anguish damages to survive a legal sufficiency challenge, a plaintiff must
‒12‒
present direct evidence of the nature, duration, and severity of her mental anguish which
establishes a substantial disruption in her daily routine. EMC Mort. Corp. v. Jones, 252 S.W.3d
857, 871 (Tex. App.—Dallas 2008, no pet.). Mental anguish must be supported of evidence of
“a high degree of mental pain and distress that is greater than mere worry, anxiety, vexation,
embarrassment, or anger.” Parkway Co. v. Woodruff, 901 S.W.2d 434, 444 (Tex.1995). Here,
Plaintiff/Appellee presented no evidence whatsoever that was specifically directed to the issue of
mental anguish. As a result, any award of damages for past mental anguish would be excessive.
Given the short duration of the past physical pain alleged by Plaintiff/Appellee combined
with the total absence of any evidence of past mental anguish, the trial court’s $100,000 damage
award for past physical pain and mental anguish is excessive and unsupported by the evidence.
Plaintiff incurred no more than roughly $14,000 in expenses for past medical treatment
undertaken, but was awarded nearly ten times that amount in past physical pain and mental
anguish damages.
3.
Unsupported Damages for Future Physical Pain and Mental Anguish
The trial court awarded Plaintiff/Appellee $300,000 in damages for her future physical
pain and mental anguish. (CR at 53.) (Appendix Tab 2.)
An award of such future damages
requires a showing of some objective evidence showing a reasonable probability that an injury
will continue to adversely affect the party claiming such damages. Hicks v Ricardo, 834 S.W.2d
587, 591 (Tex App.—Houston [1st Dist.] 1992, no writ); Strahan v. Davis, 872 S.W.2d 828, 834
(Tex. App.—Waco 1994, writ denied).
Plaintiff/Appellee testified to her belief, based on her experience and consultations with
doctors, that her pain would continue the rest of her life:
Q:
A:
Q:
A:
Do you think you’re going to be in pain into the future?
Yes.
Why do you believe that?
Because I’ve been in pain ever since my accident.
‒13‒
Q:
A:
Q:
A:
Is that also based on your understanding of your consultation with your
doctors?
Yes.
It’s your understanding, based upon your consultation with them, that you’ll
have pain for the rest of your life, is that right?
Yes.
(RR at 2:20-21.) Testimony of Plaintiff’s/Appellee’s subjective understanding that she would
experience physical pain in the future does not satisfy the required objective evidence of a
reasonable probability that such future adversity will be experienced. No other evidence of
future physical pain exists in the record. Once again, there is no evidence whatsoever of future
mental anguish such that any damage award for that element can be supported.
Moreover, the duration of the future physical pain is again an important consideration in
evaluating the damage award and again, a factor that is unsupported by the evidence in the
record. See HCRA of Tex., Inc. v. Johnston, 178 S.W.3d 861, 871 Tex. App.—Fort Worth 2005,
no pet.). The testimonial evidence of lifelong future physical pain upon which the trial court
based its damage award is inconsistent with Plaintiff’s/Appellee’s other testimony that, if
awarded future medical expenses, she would see a specialist who would give her injections
and/or surgery to alleviate her pain. (RR at 2:20.) There exists no evidence of the expected
duration of future physical pain and in fact, no evidence at all of the existence of any future
physical pain if Plaintiff/Appellee obtains the medical care she testified would reduce or remove
the pain. Given the evidence on the face of the record, the trial court’s damage award providing
both compensation for future physical pain and compensation for the cost of future medical
treatments that would alleviate said pain permits Plaintiff/Appellee a double recovery and/or
compensates her with monetary damages for lifelong future physical pain she will not suffer.
Given the total absence of any evidence of future mental anguish and given the short
duration of future physical pain if Plaintiff/Appellee obtains the medical treatment specified in
‒14‒
her testimony, the trial court’s $300,000 damage award for future physical pain and mental
anguish is unsupported and should be set aside or vastly reduced.
4.
Unsupported Damages for Past Physical Impairment
The trial court awarded Plaintiff/Appellee $100,000 in damages for her past physical
impairment. (CR at 53) (Appendix Tab 2.) Physical impairment, sometimes called loss of
enjoyment of life, encompasses the loss of the injured party's former lifestyle.
Schindler
Elevator Corp. v. Anderson, 78 S.W.3d 392, 412 (Tex. App.—Houston [14th Dist.] 2001,
judgm't vacated). Physical impairment includes a lost ability to participate in sports, hobbies, or
other recreational activities. Plainview Motels, Inc. v. Reynolds, 127 S.W.3d 21, 38 (Tex.
App.—Tyler 2003, pet. denied). To receive damages for physical impairment, the injured party
must prove that the effect of the physical impairment extends beyond any impediment to earning
capacity and beyond any pain and suffering to the extent that it produces a separate and distinct
loss that is substantial and for which she should be compensated. Golden Eagle Archery, Inc. v.
Jackson, 116 S.W.3d 757, 772 (Tex. 2003); Peter v. Ogden Ground Serv., Inc., 915 S.W.2d 648,
650 (Tex. App.—Houston [14th Dist.] 1996, no writ). Unless the separate and distinct loss is
obvious, the plaintiff must produce some evidence showing the tasks and activities that she can
no longer perform.
Estrada v. Dillon, 44 S.W.3d 558, 561-562 (Tex. 2001) (evidence of
physical impairment must focus on restriction of activities caused by injury).
Plaintiff/Appellee testified that the injuries she sustained in the subject collision have
prevented her from cleaning her house, picking up her grandchildren, gardening, swimming,
working and sleeping well. (RR at 2:22-23.) First, the alleged impairment related to her
employment is compensated by other portions of the trial court’s damage award.
Plaintiff/Appellee testified as follows:
Q:
Now, as a result of this accident, was it more difficult for you to work while
you were working?
‒15‒
A:
Oh, yeah, yeah, definitely, especially when I have to take my medication that
I didn’t want to take, then my pain was hurting. When I’m sitting down a
long time, I’m in pain. Then I couldn’t take the pain medication because I
couldn’t concentrate, because it made me sleepy and stuff, a little bit of
everything.
(RR at 2:23.) The only evidence in support of her past impairment claim is testimony of
increased pain while performing her job. (RR at 2:23.) Such damages are covered by the court’s
monetary award for past physical pain. The evidence in the record is neither separate and
distinct from any alleged “impediment to earning capacity” nor “beyond any pain and suffering
to the extent that it produces a separate and distinct loss that is substantial and for which she
should be compensated.” See Golden Eagle Archery, Inc. v. Jackson, 116 S.W.3d 757, 772 (Tex.
2003); Peter v. Ogden Ground Serv., Inc., 915 S.W.2d 648, 650 (Tex. App.—Houston [14th
Dist.] 1996, no writ).
Second, no corroborating evidence of any of the alleged areas of impairment was
produced.
There existed only Plaintiff’s/Appellee’s own limited testimony of current
impairment and there was little or no evidence presented that Plaintiff/Appellee had been
previously capable of conducting, or did in fact conduct, the stated activities prior to the subject
collision. The only testimony evidencing a loss of ability or a change in status between prior to
and subsequent to the collision were the following statements by Plaintiff/Appellee: (1) “I can’t
bend over to clean the tub like I used to;” and (2) “I swim every summer, I do laps and
everything, that was gone.” (RR at 2:22-23.)
In the record, there is only evidence of two
activities that were actually impaired, reflecting a change from pre-existing ability to current
ability: tub cleaning and swimming. (RR at 2:22-23.) For a nine-month impairment of these two
activities, the trial court awarded Plaintiff/Appellee $100,000 in past physical impairment. (CR
at 53.) (Appendix Tab 2.)
‒16‒
A comparison of this award with the past physical impairment damage amounts awarded
in other cases reflects the surmising excess of the trial court’s award. In Austin v. Shampine, a
negligence case involving a car accident, testimony established that the plaintiff had trouble
bending down or kneeling, had decreased physical mobility, could not perform physical aspects
of his job, and could not do yard work. 948 S.W.2d 900, 915-16 (Tex. App.—Texarkana 1997,
no writ). The plaintiff’s own testimony was corroborated by that of no less than six other
witnesses, including physicians, and the alleged impairment had been ongoing for several years.
Id. The award in that case for past physical impairment was $100,000, the same as awarded here
in the face of extremely limited or nonexistent uncorroborated evidence of a much smaller
degree of impairment for a much shorter duration. In Plainview Motels, Inc. v. Reynolds, a
negligence case against a surplus store, the plaintiff presented evidence that the injury to his back
impaired his ability to sleep, restricted his ability to run, bicycle, participate in triathlons and play
with his kids, all of which he had been able to do prior to the accident made the basis of the suit.
127 S.W.3d 21, 39 (Tex. App.—Tyler 2003, pet. denied). Four years’ worth of those inabilities
netted the plaintiff $25,000 in past physical impairment damages.
Id. at 28, 38.
Again,
compared with the trial court’s award in this case of four times as many damages for a much
smaller degree of impairment lasting less than one-quarter of the length of time, it is apparent
that the trial court’s award for past physical impairment is excessive, unsupported by the
evidence and should be set aside or greatly reduced.
5.
Unsupported Damages for Future Physical Impairment
Again, to receive damages for physical impairment, there must exist evidence of a
physical impairment producing a separate and distinct substantial loss. Golden Eagle Archery,
Inc. v. Jackson, 116 S.W.3d 757, 772 (Tex. 2003); Peter v. Ogden Ground Serv., Inc., 915
S.W.2d 648, 650 (Tex. App.—Houston [14th Dist.] 1996, no writ). The only evidence in the
‒17‒
record that Plaintiff/Appellee will experience any degree of future physical impairment is the
following:
Q:
A:
Q:
A:
Are you asking the judge to award $200,000 for the activities that you won’t
be able to do into the future?
Yes.
Is your understanding that you won’t be able to do these activities in the
future based on your consultation with your medical providers?
Right.
(RR at 2:23.) This conclusive testimony of subjective understanding unsupported by fact or
corroboration is insufficient support for an impairment award. Nor does the evidence on the face
of the record indicate such crucial factors as how long the alleged impairment will last, whether
it can be cured, whether the medical treatment for which Plaintiff/Appellee received monetary
damages will reduce or eliminate the impairment, etc. Plaintiff/Appellee provided no evidence
of future physical impairment, and the trial court’s monetary award of $200,000 in this category
should be wholly set aside or in the alternative, if this Court finds that some small amount of
impairment is supported, the award should be greatly reduced.
For all categories of damages for which no evidence exists in the record,
Defendants/Appellants request that the monetary damages awarded by the trial court be set aside
and a new trial ordered. “[W]hen an appellate court sustains a no evidence point after an
uncontested hearing on unliquidated damages following a no-answer default judgment, the
appropriate disposition is a remand for a new trial on the issue of unliquidated damages.” Holt
Atherton Indus., Inc. v. Heine, 835 S.W.2d 80, 86 (Tex. 1992).
In the alternative, even if this Court finds that some portions of the trial court’s damage
award are sufficiently supported by the evidence apparent on the face of the record,
Defendants/Appellants seek an appropriate remittitur of the excessive damage amounts awarded.
See Larson v. Cactus Util. Co., 730 S.W.2d 640, 641 (Tex.1987) (if part of damage verdict lacks
sufficient evidentiary support, proper course is to suggest remittitur of that part of the verdict).
‒18‒
The only damages for which Plaintiff/Appellee provided affidavit or expert testimony, or that
were specifically supported by her own uncorroborated testimony, are the $14,368 in past
medical expenses that Defendants/Appellants do not challenge here. (CR at 53.) (Appendix tab
2.) It is the position of Defendants/Appellants that $785,000 of the trial court’s $799,368 award
is unsupported by sufficient evidence. Stated another way, the amorphous portion of the damage
award that arises from figures pulled wholly out of thin air comprises an amount more than 55
times greater than the past medical damages portion of the award that is based upon actual
expenses and monetary amounts shown by Plaintiff/Appellee.
Such vast inflation of the
damages awarded was even noted by Judge Cortez (although familiar with the facts of the case,
Judge Cortez did not preside over the November 19, 2011 default judgment hearing where
Plaintiff’s/Appellee’s paltry or nonexistent evidence was received by the trial court and was not
the judge who entered the damage award), who stated:
But I got real problems with this. I mean, I don’t know what the—the evidence
was and I don’t know what was argued in front of McFarland. And that’s all fine
and good. Although, I am very curious how a $20,000 medical claim gets to
$800,000. But I just want to know if there’s anything I can do about it.
(RR at 3:38.) Even if this Appellate Court finds there exists some evidence to support the trial
court’s monetary awards in the stated damage categories, such a discrepancy between the actual
proven expenses and the damages awarded should “shock the conscience” of the Court and
entitle Defendants/Appellants to an appropriate remittitur. See Lee v. Andrews, 545 S.W.2d 238,
248 (Tex. Civ. App.—Amarillo 1976, writ dism’d) (citing J. C. Penney Company v. Duran, 479
S.W.2d 374 (Tex.Civ.App.—San Antonio 1972, writ ref'd n.r.e.), Structural Metals, Inc. v.
Impson, 489 S.W.2d 740 (Tex.Civ.App.—Corpus Christi 1972, no writ), McIver v. Gloria, 140
Tex. 566, 169 S.W.2d 710 (1943), Texas Consolidated Transportation Co. v. Eubanks, 340
S.W.2d 830 (Tex.Civ.App.—Waco 1960, writ ref'd n.r.e.)) (all holding remittitur is appropriate
when a verdict “shocks the conscience” of the court).
‒19‒
C.
APPEAL ISSUE 2:
THE TRIAL COURT ERRED IN RULING THAT DEFENDANTS/APPELLANTS
WERE PROPERLY SERVED, THAT DEFENDANTS/APPELLANTS HAD
NOTICE OF THE DEFAULT JUDGMENT HEARING, AND THAT THE POSTTRIAL MOTIONS FOR NEW TRIAL AND TO VACATE JUDGMENT WERE
UNTIMELY, AS THE EVIDENCE WAS LEGALLY AND FACTUALLY
INSUFFICIENT TO SUPPORT THE RULINGS.
Upon receipt of actual notice of the trial court’s final default ruling against them,
Defendants/Appellants filed a Motion for New Trial and to Vacate Judgment. (CR at 75-110)
Subsequently, Defendants/Appellants filed an Amended Motion, Amended Memorandum,
Second Amended Brief and Third Supplemental Brief in support thereof. (CR at 111-153, 217288, 327-334.) By order dated March 15, 2011, the trial court ruled Martin was properly served
through the Texas Secretary of State, Moffitt was properly and personally served, all parties were
provided notice of the November 19, 2010 Final Default Judgment hearing in compliance with
the trial court’s internal procedures, and therefore, the post-judgment Motions were untimely.
(CR at 335.) (Appendix tab 3.) Defendants/Appellants assert that the trial court erred in ruling
Defendants/Appellants were properly served, erred in ruling Defendants/Appellants had notice of
the default judgment hearing, and erred in ruling the post-trial Motions were untimely.
Generally, the “record” for purposes of a restricted appeal is defined as the reporter's
record and all papers on file with the trial court clerk before final judgment. See Alexander v.
Lynda's Boutique, 134 S.W.3d 845, 848–49 (Tex.2004); Cordero v. Am. Home Assurance Co.,
281 S.W.3d 13, 15 (Tex. App.—El Paso 2005, no pet.). As the Supreme Court has explained,
the appropriate avenue for the inclusion of additional evidence is by motion for new trial or the
filing of an equitable bill of review. Alexander, 134 S.W.3d at 848. Defendants/Appellants filed
the appropriate Motion for New Trial, but the trial court deemed it untimely because it found that
proper notice was received within 20 days of the November 19, 2010 default judgment order as
required by Rule 306a(4). (CR at 335.) (Appendix Tab 3.)
‒20‒
Under such circumstances, the appellate court may consider the issues of service, notice,
and Rule 306a compliance in a restricted appeal. Similar to the instant matter, Texaco, Inc. v.
Phan was a no-answer default judgment case in which the defendant Texaco filed a motion for
new trial under Texas Rule of Civil Procedure 306a. 137 S.W.3d 763 (Tex. App.—Houston [1st
Dist.] 2004, no pet.). (Appendix Tab 6.)
Entitled “Periods to Run from Signing of Judgment,” Rule 306a states in relevant part:
1.
Beginning of periods. The date of judgment or order is signed as shown
of record shall determine the beginning of the periods prescribed by these
rules for the court’s plenary power to grant a new trial or to vacate,
modify, correct or reform a judgment or order and for filing in the trial
court the various documents that these rules authorize a party to file within
such periods including, but not limited to, motions for new trial, motions
to modify judgment, motions to reinstate a case dismissed for want of
prosecution, motions to vacate judgment and requests for findings of fact
and conclusions of law; but this rule shall not determine what constitutes
rendition of a judgment or order for any other purpose….
3.
Notice of judgment. When the final judgment or other appealable order
is signed, the clerk of the court shall immediately give notice to the parties
or their attorneys of record by first-class mail advising that the judgment
or order was signed. Failure to comply with the provisions of this rule
shall not affect the periods mentioned in paragraph (a) of this rule, except
as provided in paragraph (4).
4.
No notice of judgment. If within twenty days after the judgment or other
appealable order is signed, a party adversely affected by it or his attorney
has neither received the notice required by paragraph (3) of this rule nor
acquired actual knowledge of the order, then with respect to that party all
the periods mentioned in paragraph (1) shall begin on the date that such
party or his attorney received such notice or acquired actual knowledge of
the signing, whichever occurred first, but in no event shall such periods
begin more than ninety days after the original judgment or other
appealable order was signed….
TEX. R. CIV. P. 306a (1, 3, 4). (Appendix Tab 7.)
The trial court in Texaco determined that the defendant received notice of the default
judgment three days after it was sent from the trial court and therefore deemed Texaco’s Motion
for New Trial under Rule 306a(4) untimely. Texaco filed a notice of restricted appeal, asserting
‒21‒
that the evidence was legally and factually insufficient to support the trial court’s finding of
actual notice received under Rule 306a. In consideration of that restricted appeal, the First Court
of Appeals considered the trial court’s finding on the Rule 306a motion. When the appellees
argued that challenges to notice rulings cannot be made via restricted appeal, the Texaco court
explained as follows:
The Owners argue that Texaco may not challenge the rule 306a finding on
restricted appeal because (1) the finding was made after the trial court granted the
default judgment and (2) we may not consider evidence relating to this finding
because this evidence was not before the trial court when it rendered judgment.
However, Texaco timely filed its notice of restricted appeal. We have the ability
to review the sufficiency of the evidence to support a trial court's findings
concerning the date that a party received actual notice of a judgment under rule
306a to determine whether the trial court abused its discretion. See Sharm, Inc. v.
Martinez, 885 S.W.2d 165, 167 (Tex. App.—Corpus Christi 1993, no writ)
(holding that appellate court had jurisdiction over defendant, against whom trial
court had made adverse rule 306a finding, because evidence was insufficient to
support trial court's finding that defendant had failed to prove that it did not have
timely notice of default judgment and, therefore, appellate court could consider
merits of defendant's appeal of default judgment); Hot Shot Messenger Serv., Inc.
v. State of Texas, 798 S.W.2d 413, 414 (Tex. App.—Austin 1990, writ denied)
(determining that, in appeal of default judgment, appellate court could review trial
court's rule 306a findings for factual and legal sufficiency).
Texaco, 137 S.W.3d at 766 n.1. (Appendix Tab 6.)
Here, Defendants/Appellants timely filed their Notice of Restricted Appeal on March 28,
2011, within six months of the trial court’s November 19, 2010 final default judgment order, and
this Court has the ability to review the sufficiency of the evidence supporting the trial court's
findings concerning notice dates of the default judgment under Rule 306a to determine whether
the trial court abused its discretion. On appeal, a trial court’s Rule 306a findings are reviewed
under the legal and factual sufficiency standards of review. Texaco, 137 S.W.3d at 767 (citing
Hot Shot Messenger Serv., Inc. v. State, 798 S.W.2d 413, 414 (Tex. App.—Austin 1990, writ
denied)). (Appendix Tab 6.)
‒22‒
In Texaco, the appellee presented direct testimony that a notice letter was properly
addressed, stamped, and mailed to the appellant. Id. at 415. (Appendix Tab 6.) Such evidence,
combined with circumstantial evidence such as the sender’s customary business mailing routine
for addressing, stamping and mailing, is sufficient to raise a presumption that the letter was
received by the addressee in due course. Id. (citing Cooper v. Hall, 489 S.W.2d 409, 415 (Tex.
Civ. App.—Amarillo 1972, writ ref'd n.r.e.)). (Appendix Tab 6.) However, the presumption of
receipt is rebutted by a mere denial of receipt by the addressee and is overcome conclusively
when “the evidence tending to support the contrary inference is conclusive, or so clear, positive,
and disinterested that it would be unreasonable not to give effect to it as conclusive.” Id. at 76768 (citing Gulf Ins. Co. v. Cherry, 704 S.W.2d 459, 461 (Tex. App.—Dallas 1986, writ ref'd
n.r.e.) and Employers' Nat. Life Ins. Co. of Dallas, Tex. v. Willits, 436 S.W.2d 918, 921 (Tex.
App.—Amarillo 1968, writ ref'd n.r.e.) (quoting Southland Life Ins. Co. v. Greenwade, 138 Tex.
450, 159 S.W.2d 854, 857 (1942))). (Appendix Tab 6.) The appellate court in Texaco found that
the appellant failed to meet its burden of overcoming the presumption of notice receipt
established by the appellee, but the facts and evidence in the instant case lead to a different
conclusion.
In Texaco, the appellees presented testimony by the Harris County District Clerk that she
entered the default judgment information into the Harris County Justice Information
Management System, which automatically generated a notice containing all of the defaultjudgment information. Id. at 768. (Appendix Tab 6.) The Clerk further testified that the notice
was addressed to Texaco’s registered service agent, was picked up by a mailing service vendor
who attached postage, and mailed the notice via first-class mail as was the customary mailing
procedure for the court. Id. (Appendix Tab 6.) The Texaco court found that this evidence was
‒23‒
sufficient to cause the presumption of receipt to arise. Id. (citing Cooper, 489 S.W.2d at 415).
(Appendix Tab 6.)
Here, there was no equivalent evidence produced sufficient to raise the presumption that
Defendants/Appellants received notice of the default judgment. The only evidence submitted by
Plaintiff/Appellee on the issue of proper notice of the default judgment were copies of the
correspondence generated by the trial court clerk informing Moffitt and Martin of the default.
(CR at 196-197.) Such documents, which may arguably provide evidence that the trial court
clerk generated notice letters, do not constitute sufficient (or any) proof that the trial court clerk
mailed the notice letters via first class mail in accordance with Rule 306a(3), such that a
presumption of receipt would arise. See TEX. R. CIV. P. 306a(3). (Appendix Tab 7.)
The record contains no evidence that a notice of judgment was ever mailed to
Defendants/Appellants.
The trial court’s docket sheet contains no certified mail receipts,
postcards, or other evidence of mailing, and no documentation evidencing that the notice of
judgment was received. (CR at 281-282.) There is no notation or entry on the docket sheet
evidencing service of notice upon Defendants/Appellants, although there are such entries for all
other actions taken by the clerk, including issuance of citation. (CR at 281-283.) On November
19, 2010, the clerk’s docket sheet reflects incoming correspondence from counsel for
Plaintiff/Appellee, and the entry of the default judgment. (CR at 281-282.) The notices of
judgment produced by Plaintiff/Appellee are dated December 1, 2010, but there exists no
corresponding docket entry establishing that the notices were ever actually sent to
Defendants/Appellants. (CR at 282.)
Unlike the evidence presented in Texaco, Plaintiff/Appellee in this case did not provide
any testimonial evidence from the court clerk, did not establish evidence of the customary
mailing procedures of the court, and did not produce any evidence supporting a finding that the
‒24‒
correspondence notice was affixed with postage, was mailed, or was properly addressed to
Defendants/Appellees. There simply does not exist any evidence that the notices of the default
judgment were ever mailed to Defendants/Appellants. Given such insufficient evidence, the
presumption of receipt never even arose.
However, even if such a presumption had arisen, it was rebutted by the affidavits of
Martin and Moffitt, which clearly testified that no mailed notice of the default was ever received
and that actual notice was received on February 4, 2011 by Martin and on February 28, 2011 by
Moffitt.
(CR at 97, 279.) Texas law is clear: although a presumption of receipt arises when
notice of entry of judgment is properly addressed and mailed with prepaid postage, this
presumption “vanishes” in the face of proof of non-receipt by the Defendant. Cliff v. Huggins,
724 S.W.2d 778, 780 (Tex. 1987) (citing Southland Life Ins. Co. v. Greenwade, 138 Tex. 450,
159 S.W.2d 854 (Comm'n App.1942, opinion adopted)). “The presumption, however, is not
‘evidence’ and it vanishes when opposing evidence is introduced that the letter was not
received.” Id. Texas courts have consistently held that the mere denial of receipt is sufficient to
rebut the presumption that a properly addressed, stamped, and mailed letter was received by the
addressee. See Gulf Ins. Co. v. Cherry, 704 S.W.2d 459, 461 (Tex. App. 1986) (citing Sudduth v.
Commonwealth County Mutual Insurance Co., 454 S.W.2d 196 (Tex.1970)); Anchor Casualty
Company v. Crisp, 346 S.W.2d 364 (Tex.Civ.App.--Amarillo 1961, no writ); Hot Shot
Messenger Serv., Inc. v. State, 798 S.W.2d 413, 415 (Tex. App.—Austin 1990, writ denied)).
When weighing the clear and uncontested testimony of non-receipt of notice by
Defendants/Appellants against a notice letter for which there exists zero evidence of actual
mailing, the presumption of receipt is conclusively overcome.
Because neither Defendant/Appellant received the notice required by Rule 306a(3) or
acquired actual notice within 20 days of the date the final default judgment was signed on
‒25‒
November 19, 2010, Rule 306a(4) applied to extend their deadline to file a motion for new trial
until 90 days after November 19, 2010. TEX. R. CIV. P. 306a. (Appendix Tab 7.) Because
Defendants/Appellants filed their February 7, 2011 Motion for New Trial and to Vacate
Judgment within that 90-day period, the trial court erred in ruling the motion untimely. Such
ruling should be set aside.
Had Defendants’/Appellants’ Motion for New Trial and to Vacate Judgment been
properly considered, the default judgment almost certainly would have been set aside, as
Defendants/Appellants satisfied the Craddock requirements. See Craddock v. Sunshine Bus
Lines, 133 S.W.2d 124, 126 (Tex. 1939) (requiring proof that a defendant’s failure to answer was
not intentional or due to conscious indifference, that the defendant has a meritorious defense, and
that setting aside the default would result in no prejudice to the plaintiff). A trial court abuses its
discretion by not granting a new trial when all three elements of the Craddock test are met.
Director State Employees Workers’ Comp. Div. v. Evans, 889 S.W.2d 266, 270 (Tex. 1994)
(citing Bank One Texas, N.A. v. Moody, 830 S.W.2d 81, 85 (Tex. 1992)). Although Judge Cortez
did not rule on Defendants’/Appellants’ Motion for New Trial, his statements during the
February 28, 2011 hearing indicated his belief that the Craddock requirements had been met:
Okay. And this is what I want you to assume. I want you to assume that this
judge in this court believes that the requirements under Craddock are met. So
there’s no reason to—to get into that. I just want you to assume that I think the
defendant has satisfied the Craddock test, the three elements that the failure to
answer was not unintentional [sic], the defense said something about meritorious
defense and that granting a new trial would not result in delay or otherwise injure
the plaintiff.
(RR at 3:37.)
Defendants/Appellants produced sworn affidavit testimony of Moffitt, Martin’s Regional
Safety Manager Dave Mauro, Wells Fargo Insurance Services USA’s (Martin’s insurance
broker’s) claims consultant Barb Simons, GBS’s senior claims representatives Brian Arbour,
‒26‒
Lourie Grubb, and Amanda Erb, and defense counsel Clay Cosse that established each of the
required Craddock elements.
(CR at 256-279.)
Each of these affiants testified that
Defendants’/Appellants’ failure to answer or appear was accidental and due to lack of knowledge
of suit and/or unintentional file management errors. (CR at 256-279.) The affidavits of Moffitt
and Martin clearly set forth a meritorious defense on behalf of Defendants/Appellants, not the
least of which is that Moffitt attests he never even collided with Plaintiff’s/Appellant’s vehicle.
(CR at 256-259, 278, 279.) Moreover, because the default judgment and Motion for New Trial
all occurred within the first twelve months after the date of the alleged injury, setting aside the
default would not result in any prejudice to or delay for Plaintiff/Appellant. Given the evidence,
if the trial court had properly ruled timely and considered the post-trial Motion for New Trial and
to Vacate Judgment, Defendants/Appellants almost certainly would have been granted the
requested new trial.
PRAYER
For the reasons stated, Defendants/Appellants Charles E. Moffitt and Martin
Transportation Systems, Inc. respectfully request that this Court reverse the trial court’s default
judgment
and
grant
Defendants/Appellants
a
new
trial,
or
in
the
alternative,
Defendants/Appellants respectfully seek a remittitur of the trial court’s damage award, and/or a
correction of the errors presented in any manner to which the Appellants are entitled.
‒27‒
Respectfully submitted,
FEE SMITH SHARP & VITULLO, LLP
MICHAEL P. SHARP
State Bar No. 00788857
CLAY A. COSSE
State Bar No. 24071246
MEREDITH C. ALLEN
State Bar No. 24007009
Three Galleria Tower
13155 Noel Road, Suite 1000
Dallas, Texas 75240
(972) 934-9100 Telephone
(972) 934-9200 Facsimile
ATTORNEYS FOR APPELLANTS CHARLES E.
MOFFITT AND MARTIN TRANSPORTATION
SYSTEMS, INC.
CERTIFICATE OF SERVICE
This is to certify that a true and correct copy of the above and foregoing Appellants’ Brief
has been forwarded to all counsel of record in accordance with the Texas Rules of Appellate
Procedure on this 25th day of May, 2011, as follows:
Via Hand Delivery
Niles Illich
Ben Abbott, P.C.
1934 Pendleton Drive
Garland, Texas 75041
Attorney for Appellee Adelina Vasquez
MICHAEL P. SHARP
‒28‒
APPENDIX
TAB DESCRIPTION
1.
Default Judgment Dated October 28, 2010 (CR at 29).
2.
Final Default Judgment Dated November 19, 2010 (CR at 53).
3.
Order Denying Defendants’ Motion for New Trial and to Vacate Default Judgment (CR
at 335).
4.
Transcript of Default Proveup Hearing on November 19, 2010 (RR at Vol. 2).
5.
Transcript of Hearing on Defendants’ Motion for New Trial and to Vacate Default
Judgment on March 15, 2010 (RR Vol. 3).
6.
Texaco, Inc. v. Phan, 137 S.W.3d 763 (Tex. App.—Houston [1st Dist.] 2004, no pet.).
7.
Texas Rule of Civil Procedure 306a.
‒29‒
29
59
335
05-11-00359-CV
'HIDXOW3URYHXS
1
2
3
REPORTER'S RECORD
4
VOLUME 2 OF 4
5
TRIAL COURT CAUSE NO. 10-7245
5th Court of Appeals
FILED: 04/25/2011
12:22:01
Lisa Matz, Clerk
3DJH
1
6
7
ADELINA VASQUEZ
*
IN THE DISTRICT COURT
8
VERSUS
*
OF DALLAS COUNTY, TEXAS
9
CHARLES E. MOFFITT, et al
*
44TH JUDICIAL DISTRICT
10
11
- - - - - - - - - - - - - - 12
DEFAULT PROVEUP
13
- - - - - - - - - - - - - - 14
15
16
17
18
BE IT REMEMBERED, that on November 19, 2010, the
19
following proceedings came on to be heard in the above-entitled
20
and numbered cause before the HONORABLE SHERYL MCFARLIN,
21
Associate Judge of the 44th Judicial District Court of Dallas
22
23
County, Texas.
24
25
Proceedings reported by machine shorthand.
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
2
2
3
4
5
6
A P P E A R A N C E S:
7
8
MR. BEN FRANK ABBOTT
9
BEN ABBOTT, P.C.
10
SBOT No. 07363030
11
1934 Pendleton Drive
12
Garland, Texas 75041
13
972 263-5555
14
Fax 972 682-7586
15
16
APPEARING FOR THE PLAINTIFF
17
18
19
20
21
NO APPEARANCE BY OR FOR THE DEFENDANT
22
23
24
25
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
2
3
3
4
5
6
C H R O N O L O G I C A L
I N D E X
7
8
DEFAULT PROVEUP
9
10
November 19, 2010
11
12
WITNESS OR PROCEEDING
PAGE
VOLUME
REDIRECT RECROSS
VOLUME
13
14
PLAINTIFF'S WITNESSES
DIRECT
CROSS
15
16
ADELINA VASQUES
5
17
18
19
20
21
22
23
24
25
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
4
2
3
4
5
E X H I B I T
I N D E X
6
7
DESCRIPTION
IDENTIFIED OFFERED RECEIVED VOLUME
8
9
PLIANTIFF
10
11
1-Police report
7
7
7
12
2-Photos of car
8
8
8
13
3-Medical records
9
9
9
14
4-Cost of Services affidavit
9
9
9
15
5-Rockwall Injury Rehab records
11
11
11
16
6-Rockwall Injury Rehab records
11
11
11
17
7-Plano Injury Rehabilitation
14
14
14
18
8-Plaino Injury Rehab records
14
14
14
19
9-D/FW Open MRI records
15
15
15
20
10-D/FW Open MRI records
15
15
15
21
11-Radiologist interpretations
16
16
16
22
12-Radiologist Interpretations
16
16
16
23
13-Action Diagnostics records
17
17
17
24
14-Action Diagnostics records
17
17
17
25
15-RHD Medical Center records
18
18
18
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
P R O C E E D I N G S
2
3
4
THE COURT:
Adelina Vasquez versus Charles Moffitt, et al.
Please make your appearance for the record.
5
MR. ABBOTT:
6
THE COURT:
7
We're here in Cause Number 10-07245,
Ben Abbott for Ms. Vasquez.
Would you like to call your first
witness?
8
MR. ABBOTT:
We call Adelina Vasquez.
9
(Whereupon the witness was sworn.)
10
ADELINA VASQUEZ,
11
having been sworn, was examined and testified as follows:
12
13
14
15
DIRECT EXAMINATION
BY MR. ABBOTT:
Q.
Ms. Vasquez, were you involved in an automobile
accident earlier this year?
16
A.
Yes.
17
Q.
Was the date of the accident on February 23rd, 2010?
18
A.
Yes, sir.
19
Q.
What kind of a car were you driving?
20
A.
BMW.
21
Q.
Where were you coming from?
22
A.
From home.
23
Q.
Where were you going?
24
A.
Rockwall to Dallas.
25
Q.
Okay.
And were you on the bridge that goes between
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
Rockwall and Dallas?
2
A.
Yes, sir.
3
Q.
And I understand that that bridge has eight divided
4
lanes?
5
A.
Yes.
6
Q.
And you were on the lanes going westbound?
7
A.
Exactly.
8
Q.
And you were on the second from the inside lane, is
9
that right?
10
A.
Yes.
11
Q.
And then to your left there was an 18-wheel truck?
12
A.
Yes, sir.
13
Q.
Did that 18-wheel truck change lanes into your lane?
14
A.
Yes, sir.
15
Q.
And did your car then spin around?
16
A.
Yes, sir.
17
Q.
Did your car spin around and hit the wall that
18
divides the freeways?
19
A.
Yes.
20
Q.
On a scale of 0 through 10 how hard would you say
21
that the hit was?
22
A.
10.
23
Q.
Did it damage your car?
24
A.
Yes.
25
Q.
What was the value of damage to your car?
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
A.
Totaled.
2
Q.
Okay.
3
A.
Yes, they did.
4
Q.
Who did they find at fault?
5
A.
The 18-wheeler.
6
Q.
And, in fact, did the police say that the driver of
Now, do you know if the police made a report?
7
unit 2 stated that he went to change lanes from the fourth lane
8
to the third lane and he didn't see anyone to his right side
9
and moved over?
10
A.
Yes.
11
Q.
Were there a couple of witnesses?
12
A.
Yes.
13
Q.
Did they agree with him?
14
A.
Yes.
15
Q.
And did the police say that there were -- his tire
16
17
marks were on the left side of your vehicle?
A.
18
19
MR. ABBOTT:
22
Your Honor, we would like to offer the
police report, which is Exhibit Number 1.
20
21
Yes, they did.
THE COURT:
Q.
Admitted.
Do these look to be fair and accurate depictions of
the damage to your car?
23
A.
Yes, sir.
24
Q.
That in fact is your BMW that was wrecked?
25
A.
Yes.
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
2
3
Q.
The damage primarily was to the front left where you
hit that median?
A.
Yes.
4
MR. ABBOTT:
5
THE COURT:
6
7
Q.
I offer Exhibit Number 2, Your Honor.
Admitted.
Immediately after the accident did you have any
symptoms of pain?
8
A.
Yes.
9
Q.
What part of your body had pain?
10
A.
My back, my neck, my legs.
11
Q.
Did you seek treatment?
12
A.
Yes.
13
Q.
With your doctor?
14
A.
Yes.
15
Q.
Who did you seek treatment with?
16
A.
My doctor.
17
Q.
That was your family doctor?
18
A.
Yes.
19
Q.
And did you tell your family doctor that your
20
shoulders hurt?
21
A.
Yes.
22
Q.
And that you had arm pain?
23
A.
Back pain.
24
Q.
And back pain, and neck pain?
25
A.
Yes.
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
2
Q.
Did she diagnose you with a cervical strain and left
shoulder strain?
3
A.
Uh-huh.
4
Q.
Did she prescribe medications?
5
A.
Yes.
6
Q.
Were those medications Vicodin and Flexeril?
7
A.
Yes.
8
Q.
Did she charge you $150 for that?
9
A.
Uh-huh.
10
11
THE COURT:
A.
12
13
Yes.
MR. ABBOTT:
THE COURT:
15
MR. ABBOTT:
19
It's admitted.
Thank you, Your Honor.
And Exhibit
Number 4, which is the cost of services affidavit.
17
18
We offer Plaintiff's Exhibit 3, which is
the medical records from her family doctor.
14
16
If you could say yes.
THE COURT:
Q.
It's admitted.
Did you eventually seek treatment at another
facility?
20
A.
Yes.
21
Q.
And that was for rehabilitation?
22
A.
Yes.
23
Q.
Was the first facility you sought treatment at
24
25
Rockwall Injury Rehabilitation?
A.
Yes.
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
Q.
Is that over there on Ridge Road?
2
A.
Right.
3
Q.
So that's not too far from where you live?
4
A.
No.
5
Q.
Do you remember meeting with the doctor there?
6
A.
Yes.
7
Q.
Did he examine you?
8
A.
Yes.
9
Q.
What did he believe to be wrong with you, if you
10
recall?
11
A.
He just said that I had a lot of -- that I had a lot
12
of things wrong that I would have to just get some therapy and
13
some rehabilitation and hopefully that it will take care of
14
itself.
15
so I couldn't go no more, but I still kept seeing my doctor.
16
17
Q.
I kept going to rehab, but then they said it ended,
Let's go back to the first time you see the rehab.
That was March 9, 2010?
18
A.
Right.
19
Q.
Is it your understanding that the doctor believed
20
Right.
that your left clavicle was injured?
21
A.
Yes.
22
Q.
As well as your right hip?
23
A.
Yes.
24
Q.
And your neck, your mid back and your low back?
25
A.
Yes.
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
Q.
And then your right elbow?
2
A.
Yes.
3
Q.
Did he prescribe a course of therapy for you?
4
A.
Yes.
5
Q.
Did he take X-rays?
6
A.
Yes, he did.
7
Q.
Did he take X-rays of your neck, mid back and low
8
Yes, he did.
back?
9
A.
Yes.
10
Q.
In terms of the modality of therapy, did he prescribe
11
traction, that is where you lay on a roller bed?
12
A.
Yes.
13
Q.
Did he do electro muscle stimulation, which would be
14
with pads?
15
A.
Yes, sir.
16
Q.
Did they do chiropractic manipulations?
17
A.
Yes.
18
Q.
Did you proceed to go back to Rockwall Injury
19
20
Rehabilitation on March 10 and March 11?
A.
21
Yes, sir.
MR. ABBOTT:
Your Honor, we would ask that
22
Plaintiff's Exhibit 5 be admitted, and Plaintiff's Exhibit 6,
23
which are the records from Rockwall Injury Rehabilitation.
24
25
Q.
Did you eventually transfer to a different clinic
for you therapy?
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
A.
Yes.
2
Q.
Why is that?
3
A.
Because where I was going, the facility where I was
4
going was kind of like awkward from my job, I had to be getting
5
off all of the time.
6
where it wouldn't hurt my job time, I guess.
7
saying that right.
8
because my manager was kind of -- it's taking you too long to
9
go to therapy.
10
What they did is, they put me closer to
Hopefully I'm
So I wouldn't lose so much time at work,
So they switched me to -- right there on Plano and Parker,
11
which my job was on Parker and the Tollway.
12
minutes.
It took like ten
So that's why he switched me over there.
13
Q.
At the time of the accident where were you working?
14
A.
At the time of the accident I was working at Dallas
15
Pulmonary in Plano.
16
Q.
What kind of job did you do?
17
A.
Billing specialist.
18
Q.
How long had you worked as a billing specialist at
19
Dallas Pulmonary?
20
A.
Nine years.
21
Q.
Do you recall the first date that you went to Plano
22
Injury Rehab?
23
A.
Yes.
24
Q.
Was that March 16, 2010?
25
A.
Yes.
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
Q.
And did they do a similar course of therapy?
2
A.
Yes.
3
Q.
And did you go back there on March 19th?
4
A.
Yes.
5
Q.
Also on March 19th did you go back to your family
6
doctor?
7
A.
Yes.
8
Q.
And when you went back to your family doctor the
9
10
second time, did you complain about your neck, your shoulder
and your right hip?
11
A.
Yes.
12
Q.
Did you go back for further therapy after that?
13
A.
Yes.
14
Q.
To Plano Injury Rehab?
15
A.
Yes, sir.
16
Q.
The records would reflect that subsequently you went
17
to treatment on March 23rd?
18
A.
Uh-huh.
19
Q.
24th?
20
A.
Yes.
21
Q.
Let me just ask it for the court reporter, then you
22
23
can agree or disagree with it after I'm done.
So the question is:
Did you treat on March 24th, 26th,
24
30th, April 1st, April 2nd, April 6th, April 8, April 9th,
25
April 15th and April 21st?
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
A.
Yes.
2
Q.
Okay.
3
MR. ABBOTT:
I'm going to offer Plaintiff's Exhibit
4
Number 7 and Number 8, which are the records and the billing
5
from Plano Injury Rehabilitation.
6
THE COURT:
7
MR. ABBOTT:
They're admitted.
Thank you, Your Honor.
8
Q.
On March 24th did you have an MRI?
9
A.
Yes.
10
Q.
Do you remember where you had your MRI?
11
A.
They sent me somewhere -- I'm sorry.
12
Dallas, a specialist.
13
14
Q.
A.
And do you remember what areas of your back
Yes, lower back, my clavicle, all the way to my lower
back.
17
18
Okay.
you had examined?
15
16
It's in North
Q.
Did you ever confer with your doctor about what the
impressions were from those MRIs?
19
A.
Yes.
20
Q.
What is your understanding of what your injuries
21
22
were?
A.
The specialist told me that he gave me some steroids
23
and they kind of got me sick, but he said that he was going to
24
give me those steroids, but that really, honestly there was
25
nothing really that they can fix right now.
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
2
Q.
Back up just a little bit.
We're talking about the
results from those MRIs.
3
A.
Okay.
4
Q.
Do you recall, your understanding what the injuries
5
were?
6
A.
Yes.
7
Q.
And what were they?
8
A.
It was the -- my low back and my clavicle.
9
Q.
Okay.
So in terms of your lower back, is it your
10
understanding that you had a 3 to 4 millimeter disk herniation
11
at L4-5 and L5-S1?
12
A.
Uh-huh, yes.
13
Q.
Is that where your pain is, just right below where
14
your belt is?
15
A.
Yes, pain right now, I have pain right now.
16
Q.
Did you also have any findings in your neck from that
18
A.
Yes.
19
Q.
Was that a 2 to 3 millimeter herniation at C2-3?
20
A.
Yes.
21
Q.
And that's kind of between your head and where your
17
22
23
24
25
MRI?
head is attached to your back?
A.
Yes.
MR. ABBOTT:
Your Honor, we would offer Plaintiff's
Exhibits 9 and 10, which are the records and bills from D/FW
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
Open MRI.
2
THE COURT:
3
MR. ABBOTT:
4
5
Q.
They're admitted.
Thank you, Your Honor.
Did you then continue to get treatment on April 26
and 28th at Plano Injury Rehabilitation?
6
A.
Yes.
7
Q.
On April 28th were your X-rays interpreted by
8
radiologists?
9
A.
Yes.
10
Q.
Then did you go back to treatment at Plano Injury
11
Rehabilitation on April 29th, May 3rd, May 4th, May 12th, May
12
20 and May 21st?
13
A.
Yes.
14
Q.
On May 24th did you go to see Dr. Cole?
15
A.
Yes.
16
MR. ABBOTT:
Your Honor, I ask to have admitted
17
Plaintiff's Exhibit 11 and 12, which are the interpretations
18
from the radiologist of those MRIs.
19
20
21
THE COURT:
Q.
They're admitted.
In terms of Dr. Cole, did she mention to you that
--
were you still in pain?
22
A.
Yes.
23
Q.
Did she prescribe any medications for you?
24
A.
Yes.
25
Q.
Were those medications Medrol and Flexeril?
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
A.
Yes.
2
Q.
Did she instruct you to return to your chiropractor
3
for further therapy?
4
A.
Yes.
5
Q.
Did she mention to you that you needed to have
6
injections on your low back?
7
A.
Yes.
8
Q.
Did you return to Plano Injury Rehab for treatment on
9
May 27th, May 28th, June 1st and June 4th?
10
A.
Yes.
11
Q.
And then did you have any testing with Action
12
Diagnostic?
13
A.
Yes.
14
Q.
And did they find that you had a moderate disability?
15
A.
Yes.
16
MR. ABBOTT:
Your Honor, we would ask that
17
Plaintiff's Exhibits 13 and 14, which are the records and bills
18
from Action Diagnostics, be admitted.
19
THE COURT:
20
MR. ABBOTT:
They're admitted.
Thank you, Your Honor.
21
Q.
And, lastly, did you go back to the hospital at RHD?
22
A.
Yes.
23
Q.
Was that on April 8th of this year?
24
A.
Yes.
25
Q.
And did you mention that you had severe back pain
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
2
from your auto accident of February 23rd, 2010?
A.
3
4
MR. ABBOTT:
7
We ask that Plaintiff's Exhibit 15 be
admitted, which are the records from RHD Medical Center.
5
6
Yes.
THE COURT:
Q.
It's admitted.
So in total we've submitted to the Court
medical bills of a total of $14,368?
8
A.
Yes.
9
Q.
Do you believe that those are reasonable?
10
A.
No.
11
Q.
Why is that?
12
A.
Because I still need to get some more treatment.
13
Q.
Okay.
14
For the past then, do you believe that's a
reasonable amount?
15
A.
Yes.
16
Q.
Do you believe this treatment was necessitated by
17
this accident?
18
A.
Yes.
19
Q.
In fact, do you believe that these injuries were
20
caused by the accident?
21
A.
Yes.
22
Q.
Why do you believe that?
23
A.
Because I've never been in such pain, since the
24
25
accident.
Q.
Do you have an understanding whether you're going to
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
have to have medical treatment in the future?
2
A.
Yes.
3
Q.
What type of medical treatment are you going to need
4
5
6
in the future?
A.
I'm going to go back to the specialist, back
specialist, and get some injections.
7
Q.
What's the reason that you haven't gone now?
8
A.
Money and insurance.
9
Q.
If you would tell Judge McFarlin about the money and
10
11
insurance.
A.
Okay.
I got laid off.
I had been with my office for
12
ten years.
13
doctors left, so that's why they laid me off.
14
lot in reference to the accident.
15
to tell me that they laid me off for that reason.
16
talk to my manager, but he said they had to lay me off because
17
of the income, their budget.
18
keep going.
19
They're saying that the doctor -- one of the main
I had been out a
Of course, they're not going
I did try to
Now I don't have insurance to
I did call my doctor, she is my doctor, and I asked her --
20
actually, she is still filling my medications.
21
that's real sweet of her because I need to go back, she says,
22
to see her, but I don't have no insurance.
23
Q.
And again
Would it be fair to say since this accident happened
24
you were laid off from your job and your health insurance
25
terminated?
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
A.
Yes.
2
Q.
So you're waiting to use the money you receive from
3
this lawsuit to get the rest of your medical treatment?
4
A.
Yes.
5
Q.
And do you have an idea of how much your medical
6
treatment in the future is going to be?
7
A.
No.
8
Q.
At some point you've talked to your doctor about
9
getting injections?
10
A.
Yes.
11
Q.
And getting surgery?
12
A.
Yes.
13
Q.
What is your understanding of how much the future
14
15
medical bills would be for that?
A.
I don't know.
He is a specialist, but he told me
16
that he was going to start with injections.
17
injections doesn't work, then we will talk about surgery on my
18
back.
19
20
Q.
Then if the
So are you going to ask the Judge to set aside
$85,000 for your future medical care?
21
A.
Yes.
22
Q.
Have you been in pain as a result of this accident?
23
A.
Yes.
24
Q.
On a scale of 0 through 10, how would you describe
25
Yes, I have.
the pain?
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
2
3
4
A.
8.
Like my back right now, I can't even stand this
long.
Q.
So ever since the date of the accident until now
you've been in pain?
5
A.
Yes.
6
Q.
And you're in pain right now?
7
A.
Yes.
8
Q.
Your pain is in your low back right now?
9
A.
Yes.
10
Q.
Are you asking the Court to award $100,000 for your
11
past pain?
12
A.
Yes.
13
Q.
Do you think you're going to be in pain into the
14
future?
15
A.
Yes.
16
Q.
Why do you believe that?
17
A.
Because I've been in pain ever since my accident.
18
Q.
Is that also based on your understanding of your
19
consultation with your doctors?
20
A.
Yes.
21
Q.
It's your understanding, based on your consultation
22
with them, that you'll have pain for the rest of your life, is
23
that right?
24
A.
Yes.
25
Q.
So you're asking the Judge to award $300,000 for
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
future pain?
2
A.
Yes.
3
Q.
Have you been unable to do activities around the
4
house as a result of this accident?
5
A.
Yes.
6
Q.
If you would tell the Judge the activities that you
7
8
9
10
11
12
13
haven't been able to do.
A.
Just the normal -- I can't vacuum.
my carpet no more for sure.
I can't shampoo
Washing dishes, I have to do it
real quick, because I can't stand a long time.
When I wash clothes, pulling out the clothes from the -- I
can't do that either.
My husband has been very supportive ever since I had the
14
accident.
He has been doing a lot of work around the house.
15
Folding.
16
That's the way I feel because a woman has to clean and that's
17
the -- I like doing that.
18
having a hard time -- I did hire somebody to come and help me,
19
you know.
It's just, I mean, my whole life just is gone, to me.
I'm a very clean person, too, so I'm
20
Q.
Are you able to mop?
21
A.
No, no, I cannot mop.
22
I cannot clean the tub, I
can't bend over to clean the tub like I used to.
23
Q.
Are you able to garden?
24
A.
No, I cannot.
25
Q.
Do you have grandkids?
I tried that already this past summer.
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
A.
I have two grandchildren.
And the first thing that
2
my doctor said is do not pick them up.
3
they were still little, and I was taking care of them on
4
Saturdays for my daughter, because she goes to school full time
5
and works on the weekends.
6
grandchildren on the weekends, so my doctor told me do not lift
7
those babies.
8
9
10
11
12
13
14
Q.
When I had the accident
She knew I was taking care of my
Prior to the accident did you do swimming for
exercise?
A.
Yes, sir, this summer -- my summer was just gone.
I
swim every summer, I do laps and everything, that was gone.
Q.
Now, as a result of this accident, was it more
difficult for you to work while you were working?
A.
Oh, yeah, yeah, definitely, especially when I have to
15
take my medication that I didn't want to take, then my pain was
16
hurting.
17
I couldn't take the pain medication because I couldn't
18
concentrate, because it made me sleepy and stuff, a little bit
19
of everything.
20
21
Q.
When I'm sitting down a long time, I'm in pain.
Then
I think that's probably why they laid me off.
So are you asking the judge to award you $100,000
for your impaired activities in the past?
22
A.
Yes.
23
Q.
Are you asking the Judge to award $200,000 for the
24
25
activities that you won't be able to do into the future?
A.
Yes.
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
Q.
Is your understanding that you won't be able to do
2
these activities in the future based on your consultation with
3
your medical providers?
4
A.
Right.
5
Q.
Again, you believe your impairment, past and future
6
pain and suffering, past and future, was caused by this
7
accident?
8
A.
Yes.
9
Q.
And why do you believe that?
10
A.
Because I haven't had any kind of pain like this
11
since the accident.
I mean, I can't sleep at night, I have to
12
take sleeping pills to sleep.
13
accident.
14
health.
That's why I know it was the
I was in great shape.
15
MR. ABBOTT:
16
THE COURT:
I've always been in good
Nothing further, Your Honor.
Can you tell me about Martin
17
Transportation Systems and Charles Moffitt and their
18
relationship?
19
MR. ABBOTT:
20
is the driver.
21
vehicle.
22
According to the police report, Moffitt
Martin Transportation is the owner of the
The Court has previously granted default judgment against
23
the driver only.
We're asking the Court to grant a default
24
judgment against Martin Transportation Systems, Inc., and to
25
grant our judgment -- damages against the driver and judgment
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
2
3
4
5
6
against the vehicle owner.
THE COURT:
On what do you base the negligent
entrustment?
So you don't know if Charles Moffitt was an employee of
Martin Transportation?
MR. ABBOTT:
We believe he was.
On the police report
7
it shows that they own the vehicle, and that he drove the
8
vehicle for them.
9
10
THE COURT:
But you weren't able to find out whether
or not he was an employee?
11
MR. ABBOTT:
12
THE COURT:
No.
Because you say there was negligent
13
entrustment, yet you would have to make some sort of
14
allegations that they knew -- well, you did make the allegation
15
that they knew or should have known.
16
an employee.
17
18
19
MR. ABBOTT:
I wish we knew if he was
Did he say he worked for them?
Let me develop it, actually.
THE WITNESS:
Actually, the guy talked to my husband
20
after the accident, and he just said that he had seen me -- he
21
was trying to talk to my husband, but he said that he worked
22
for that company.
23
That they worked for that company, they were the drivers.
There was another lady there also with him.
24
THE COURT:
25
THE WITNESS:
Okay.
He said he was an employee, he told my
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
husband --
2
3
THE COURT:
All right, that's a better basis, I
think.
4
You're not attempting to get lost future wages?
5
Off the record.
6
Loss of earning capacity.
7
Q.
8
Ms. Vasquez, do you believe that this diminished your
ability to work?
9
A.
Yes.
10
Q.
Okay.
11
Yeah.
In the past how much do you believe that you
lost from your inability to work?
12
A.
Okay.
13
Q.
Between the accident and today.
14
A.
And today.
15
As I said, after the accident --
Oh.
to get up, just everything.
16
THE COURT:
17
THE WITNESS:
18
When were you terminated?
Like -- it's going to be about a month
ago.
19
THE COURT:
20
THE WITNESS:
21
THE COURT:
22
THE WITNESS:
23
THE COURT:
24
25
It's really hard, it's hard for me
How much did you make a month?
About 3,400.
Was that net?
Net.
It was net.
How old are you?
THE WITNESS:
55.
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
THE COURT:
2
would be able to do?
3
THE WITNESS:
4
THE COURT:
5
THE WITNESS:
6
THE COURT:
7
THE WITNESS:
Can you imagine any type of job that you
At this point, probably not.
Only if you're laying on your back?
Yeah.
I did not -Even if I'm laying on my back, I was
8
telling him, even if I lay for awhile, because my back starts
9
hurting, I have to turn to the right and to the left.
I turn
10
all night.
11
mean, just like my life is like gone.
12
health.
13
like, Gee, Mom, I've never seen you like this.
14
year old is out shampooing my carpet right now because he knows
15
I can't do it any more.
16
My husband is just irritated about that, too.
I was in such good
I've always worked, was a go-getter.
THE COURT:
I
Now my kids are
Actually, my 27
Everything seems to be in order except
17
for in the Original Petition it does not -- when you serve an
18
out-of-state Defendant by Secretary of State you have to say
19
certain words, and those words are this.
20
by serving their home or home office address.
And you don't
21
say that, you just say this is their address.
So that's the
22
only thing that needs to be fixed before I can -- well, also I
23
don't think I saw a certificate of last known address for
24
Martin Transportation.
25
MR. ABBOTT:
They should be served
We do have that, that was attached to
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
the original motion for default judgment.
2
THE COURT:
You have two?
I only have one motion for
3
default judgment, it was filed on 10-28.
4
another one?
5
6
7
MR. ABBOTT:
You say there was
Well, let's see.
This is the one that has Defendant Martin Transportation
Systems, Inc., the one on the 28th.
8
THE COURT:
9
for Charles Moffitt.
Actually, mine says that it was the one
That's the only thing that you need to
10
change.
Actually, you can -- you don't have to have it in the
11
petition itself, it's in the record anyway, it will suffice.
12
So if you know for a fact that is their home address, then you
13
can actually do it by hand, if you wanted to.
14
MR. ABBOTT:
15
THE COURT:
Very well.
You just need to put the cause number and
16
the style of the case, and then that certificate, and then I
17
will grant your judgment.
18
MR. ABBOTT:
19
THE COURT:
20
MR. ABBOTT:
Yes.
21
MR. ABBOTT:
This was against the individual
22
23
24
25
Defendant.
Great, thank you, Your Honor.
Do you have a proposed order?
This was against the Defendant.
THE COURT:
I just want to do it in one order, one
judgment, one final judgment.
MR. ABBOTT:
Do you want me to interlineate with the
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
2
3
amounts, too?
THE COURT:
If you would like, that's fine.
END OF PROCEEDINGS
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
THE STATE OF TEXAS
2
COUNTY OF DALLAS
3
4
I, SHARRON RODRIGUEZ RANKIN, Official Court Reporter in and
5
for the 160th Judicial District Court of Dallas County, State
6
of Texas, do hereby certify that the above and foregoing
7
contains a true and correct transcription of all portions of
8
evidence and other proceedings directed in writing by counsel
9
for the parties to be included in this Volume of the Reporter's
10
Record in the above styled and numbered cause, all of which
11
occurred in open court or in chambers and were reported by me.
12
I further certify that this transcription of the
13
proceedings truly and correctly reflects the exhibits, if any,
14
offered by the respective parties.
15
I further certify that the total cost for the preparation
16
of this Reporter's Record is $150 and was paid by Fee, Smith,
17
Sharp & Vitullo, LLP.
18
WITNESS my hand this the 4th day of April, 2011.
19
20
21
22
23
24
/s/
_______________________
SHARRON RODRIGUEZ RANKIN
Official Court Reporter
Certificate Number 1082
Expiration Date: 12-31-12
160th District Court
6th Floor Allen Courts Bldg.
Dallas, Texas 75202
(214) 653-6938
25
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
1
2
3
REPORTER'S RECORD
4
VOLUME 2 OF 4
5
TRIAL COURT CAUSE NO. 10-7245
6
7
ADELINA VASQUEZ
*
IN THE DISTRICT COURT
8
VERSUS
*
OF DALLAS COUNTY, TEXAS
9
CHARLES E. MOFFITT, et al
*
44TH JUDICIAL DISTRICT
10
11
- - - - - - - - - - - - - - 12
DEFAULT PROVEUP
13
- - - - - - - - - - - - - - 14
15
16
17
18
BE IT REMEMBERED, that on November 19, 2010, the
19
following proceedings came on to be heard in the above-entitled
20
and numbered cause before the HONORABLE SHERYL MCFARLIN,
21
Associate Judge of the 44th Judicial District Court of Dallas
22
23
County, Texas.
24
25
Proceedings reported by machine shorthand.
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
2
2
3
4
5
6
A P P E A R A N C E S:
7
8
MR. BEN FRANK ABBOTT
9
BEN ABBOTT, P.C.
10
SBOT No. 07363030
11
1934 Pendleton Drive
12
Garland, Texas 75041
13
972 263-5555
14
Fax 972 682-7586
15
16
APPEARING FOR THE PLAINTIFF
17
18
19
20
21
NO APPEARANCE BY OR FOR THE DEFENDANT
22
23
24
25
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
2
3
3
4
5
6
C H R O N O L O G I C A L
I N D E X
7
8
DEFAULT PROVEUP
9
10
November 19, 2010
11
12
WITNESS OR PROCEEDING
PAGE
VOLUME
REDIRECT RECROSS
VOLUME
13
14
PLAINTIFF'S WITNESSES
DIRECT
CROSS
15
16
ADELINA VASQUES
5
17
18
19
20
21
22
23
24
25
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
4
2
3
4
5
E X H I B I T
I N D E X
6
7
DESCRIPTION
IDENTIFIED OFFERED RECEIVED VOLUME
8
9
PLIANTIFF
10
11
1-Police report
7
7
7
12
2-Photos of car
8
8
8
13
3-Medical records
9
9
9
14
4-Cost of Services affidavit
9
9
9
15
5-Rockwall Injury Rehab records
11
11
11
16
6-Rockwall Injury Rehab records
11
11
11
17
7-Plano Injury Rehabilitation
14
14
14
18
8-Plaino Injury Rehab records
14
14
14
19
9-D/FW Open MRI records
15
15
15
20
10-D/FW Open MRI records
15
15
15
21
11-Radiologist interpretations
16
16
16
22
12-Radiologist Interpretations
16
16
16
23
13-Action Diagnostics records
17
17
17
24
14-Action Diagnostics records
17
17
17
25
15-RHD Medical Center records
18
18
18
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
P R O C E E D I N G S
2
3
4
THE COURT:
Adelina Vasquez versus Charles Moffitt, et al.
Please make your appearance for the record.
5
MR. ABBOTT:
6
THE COURT:
7
We're here in Cause Number 10-07245,
Ben Abbott for Ms. Vasquez.
Would you like to call your first
witness?
8
MR. ABBOTT:
We call Adelina Vasquez.
9
(Whereupon the witness was sworn.)
10
ADELINA VASQUEZ,
11
having been sworn, was examined and testified as follows:
12
13
14
15
DIRECT EXAMINATION
BY MR. ABBOTT:
Q.
Ms. Vasquez, were you involved in an automobile
accident earlier this year?
16
A.
Yes.
17
Q.
Was the date of the accident on February 23rd, 2010?
18
A.
Yes, sir.
19
Q.
What kind of a car were you driving?
20
A.
BMW.
21
Q.
Where were you coming from?
22
A.
From home.
23
Q.
Where were you going?
24
A.
Rockwall to Dallas.
25
Q.
Okay.
And were you on the bridge that goes between
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
Rockwall and Dallas?
2
A.
Yes, sir.
3
Q.
And I understand that that bridge has eight divided
4
lanes?
5
A.
Yes.
6
Q.
And you were on the lanes going westbound?
7
A.
Exactly.
8
Q.
And you were on the second from the inside lane, is
9
that right?
10
A.
Yes.
11
Q.
And then to your left there was an 18-wheel truck?
12
A.
Yes, sir.
13
Q.
Did that 18-wheel truck change lanes into your lane?
14
A.
Yes, sir.
15
Q.
And did your car then spin around?
16
A.
Yes, sir.
17
Q.
Did your car spin around and hit the wall that
18
divides the freeways?
19
A.
Yes.
20
Q.
On a scale of 0 through 10 how hard would you say
21
that the hit was?
22
A.
10.
23
Q.
Did it damage your car?
24
A.
Yes.
25
Q.
What was the value of damage to your car?
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
A.
Totaled.
2
Q.
Okay.
3
A.
Yes, they did.
4
Q.
Who did they find at fault?
5
A.
The 18-wheeler.
6
Q.
And, in fact, did the police say that the driver of
Now, do you know if the police made a report?
7
unit 2 stated that he went to change lanes from the fourth lane
8
to the third lane and he didn't see anyone to his right side
9
and moved over?
10
A.
Yes.
11
Q.
Were there a couple of witnesses?
12
A.
Yes.
13
Q.
Did they agree with him?
14
A.
Yes.
15
Q.
And did the police say that there were -- his tire
16
17
marks were on the left side of your vehicle?
A.
18
19
MR. ABBOTT:
22
Your Honor, we would like to offer the
police report, which is Exhibit Number 1.
20
21
Yes, they did.
THE COURT:
Q.
Admitted.
Do these look to be fair and accurate depictions of
the damage to your car?
23
A.
Yes, sir.
24
Q.
That in fact is your BMW that was wrecked?
25
A.
Yes.
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
2
3
Q.
The damage primarily was to the front left where you
hit that median?
A.
Yes.
4
MR. ABBOTT:
5
THE COURT:
6
7
Q.
I offer Exhibit Number 2, Your Honor.
Admitted.
Immediately after the accident did you have any
symptoms of pain?
8
A.
Yes.
9
Q.
What part of your body had pain?
10
A.
My back, my neck, my legs.
11
Q.
Did you seek treatment?
12
A.
Yes.
13
Q.
With your doctor?
14
A.
Yes.
15
Q.
Who did you seek treatment with?
16
A.
My doctor.
17
Q.
That was your family doctor?
18
A.
Yes.
19
Q.
And did you tell your family doctor that your
20
shoulders hurt?
21
A.
Yes.
22
Q.
And that you had arm pain?
23
A.
Back pain.
24
Q.
And back pain, and neck pain?
25
A.
Yes.
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
2
Q.
Did she diagnose you with a cervical strain and left
shoulder strain?
3
A.
Uh-huh.
4
Q.
Did she prescribe medications?
5
A.
Yes.
6
Q.
Were those medications Vicodin and Flexeril?
7
A.
Yes.
8
Q.
Did she charge you $150 for that?
9
A.
Uh-huh.
10
11
THE COURT:
A.
12
13
Yes.
MR. ABBOTT:
THE COURT:
15
MR. ABBOTT:
19
It's admitted.
Thank you, Your Honor.
And Exhibit
Number 4, which is the cost of services affidavit.
17
18
We offer Plaintiff's Exhibit 3, which is
the medical records from her family doctor.
14
16
If you could say yes.
THE COURT:
Q.
It's admitted.
Did you eventually seek treatment at another
facility?
20
A.
Yes.
21
Q.
And that was for rehabilitation?
22
A.
Yes.
23
Q.
Was the first facility you sought treatment at
24
25
Rockwall Injury Rehabilitation?
A.
Yes.
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
Q.
Is that over there on Ridge Road?
2
A.
Right.
3
Q.
So that's not too far from where you live?
4
A.
No.
5
Q.
Do you remember meeting with the doctor there?
6
A.
Yes.
7
Q.
Did he examine you?
8
A.
Yes.
9
Q.
What did he believe to be wrong with you, if you
10
recall?
11
A.
He just said that I had a lot of -- that I had a lot
12
of things wrong that I would have to just get some therapy and
13
some rehabilitation and hopefully that it will take care of
14
itself.
15
so I couldn't go no more, but I still kept seeing my doctor.
16
17
Q.
I kept going to rehab, but then they said it ended,
Let's go back to the first time you see the rehab.
That was March 9, 2010?
18
A.
Right.
19
Q.
Is it your understanding that the doctor believed
20
Right.
that your left clavicle was injured?
21
A.
Yes.
22
Q.
As well as your right hip?
23
A.
Yes.
24
Q.
And your neck, your mid back and your low back?
25
A.
Yes.
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
Q.
And then your right elbow?
2
A.
Yes.
3
Q.
Did he prescribe a course of therapy for you?
4
A.
Yes.
5
Q.
Did he take X-rays?
6
A.
Yes, he did.
7
Q.
Did he take X-rays of your neck, mid back and low
8
Yes, he did.
back?
9
A.
Yes.
10
Q.
In terms of the modality of therapy, did he prescribe
11
traction, that is where you lay on a roller bed?
12
A.
Yes.
13
Q.
Did he do electro muscle stimulation, which would be
14
with pads?
15
A.
Yes, sir.
16
Q.
Did they do chiropractic manipulations?
17
A.
Yes.
18
Q.
Did you proceed to go back to Rockwall Injury
19
20
Rehabilitation on March 10 and March 11?
A.
21
Yes, sir.
MR. ABBOTT:
Your Honor, we would ask that
22
Plaintiff's Exhibit 5 be admitted, and Plaintiff's Exhibit 6,
23
which are the records from Rockwall Injury Rehabilitation.
24
25
Q.
Did you eventually transfer to a different clinic
for you therapy?
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
A.
Yes.
2
Q.
Why is that?
3
A.
Because where I was going, the facility where I was
4
going was kind of like awkward from my job, I had to be getting
5
off all of the time.
6
where it wouldn't hurt my job time, I guess.
7
saying that right.
8
because my manager was kind of -- it's taking you too long to
9
go to therapy.
10
What they did is, they put me closer to
Hopefully I'm
So I wouldn't lose so much time at work,
So they switched me to -- right there on Plano and Parker,
11
which my job was on Parker and the Tollway.
12
minutes.
It took like ten
So that's why he switched me over there.
13
Q.
At the time of the accident where were you working?
14
A.
At the time of the accident I was working at Dallas
15
Pulmonary in Plano.
16
Q.
What kind of job did you do?
17
A.
Billing specialist.
18
Q.
How long had you worked as a billing specialist at
19
Dallas Pulmonary?
20
A.
Nine years.
21
Q.
Do you recall the first date that you went to Plano
22
Injury Rehab?
23
A.
Yes.
24
Q.
Was that March 16, 2010?
25
A.
Yes.
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
Q.
And did they do a similar course of therapy?
2
A.
Yes.
3
Q.
And did you go back there on March 19th?
4
A.
Yes.
5
Q.
Also on March 19th did you go back to your family
6
doctor?
7
A.
Yes.
8
Q.
And when you went back to your family doctor the
9
10
second time, did you complain about your neck, your shoulder
and your right hip?
11
A.
Yes.
12
Q.
Did you go back for further therapy after that?
13
A.
Yes.
14
Q.
To Plano Injury Rehab?
15
A.
Yes, sir.
16
Q.
The records would reflect that subsequently you went
17
to treatment on March 23rd?
18
A.
Uh-huh.
19
Q.
24th?
20
A.
Yes.
21
Q.
Let me just ask it for the court reporter, then you
22
23
can agree or disagree with it after I'm done.
So the question is:
Did you treat on March 24th, 26th,
24
30th, April 1st, April 2nd, April 6th, April 8, April 9th,
25
April 15th and April 21st?
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
A.
Yes.
2
Q.
Okay.
3
MR. ABBOTT:
I'm going to offer Plaintiff's Exhibit
4
Number 7 and Number 8, which are the records and the billing
5
from Plano Injury Rehabilitation.
6
THE COURT:
7
MR. ABBOTT:
They're admitted.
Thank you, Your Honor.
8
Q.
On March 24th did you have an MRI?
9
A.
Yes.
10
Q.
Do you remember where you had your MRI?
11
A.
They sent me somewhere -- I'm sorry.
12
Dallas, a specialist.
13
14
Q.
A.
And do you remember what areas of your back
Yes, lower back, my clavicle, all the way to my lower
back.
17
18
Okay.
you had examined?
15
16
It's in North
Q.
Did you ever confer with your doctor about what the
impressions were from those MRIs?
19
A.
Yes.
20
Q.
What is your understanding of what your injuries
21
22
were?
A.
The specialist told me that he gave me some steroids
23
and they kind of got me sick, but he said that he was going to
24
give me those steroids, but that really, honestly there was
25
nothing really that they can fix right now.
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
2
Q.
Back up just a little bit.
We're talking about the
results from those MRIs.
3
A.
Okay.
4
Q.
Do you recall, your understanding what the injuries
5
were?
6
A.
Yes.
7
Q.
And what were they?
8
A.
It was the -- my low back and my clavicle.
9
Q.
Okay.
So in terms of your lower back, is it your
10
understanding that you had a 3 to 4 millimeter disk herniation
11
at L4-5 and L5-S1?
12
A.
Uh-huh, yes.
13
Q.
Is that where your pain is, just right below where
14
your belt is?
15
A.
Yes, pain right now, I have pain right now.
16
Q.
Did you also have any findings in your neck from that
18
A.
Yes.
19
Q.
Was that a 2 to 3 millimeter herniation at C2-3?
20
A.
Yes.
21
Q.
And that's kind of between your head and where your
17
22
23
24
25
MRI?
head is attached to your back?
A.
Yes.
MR. ABBOTT:
Your Honor, we would offer Plaintiff's
Exhibits 9 and 10, which are the records and bills from D/FW
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
Open MRI.
2
THE COURT:
3
MR. ABBOTT:
4
5
Q.
They're admitted.
Thank you, Your Honor.
Did you then continue to get treatment on April 26
and 28th at Plano Injury Rehabilitation?
6
A.
Yes.
7
Q.
On April 28th were your X-rays interpreted by
8
radiologists?
9
A.
Yes.
10
Q.
Then did you go back to treatment at Plano Injury
11
Rehabilitation on April 29th, May 3rd, May 4th, May 12th, May
12
20 and May 21st?
13
A.
Yes.
14
Q.
On May 24th did you go to see Dr. Cole?
15
A.
Yes.
16
MR. ABBOTT:
Your Honor, I ask to have admitted
17
Plaintiff's Exhibit 11 and 12, which are the interpretations
18
from the radiologist of those MRIs.
19
20
21
THE COURT:
Q.
They're admitted.
In terms of Dr. Cole, did she mention to you that
--
were you still in pain?
22
A.
Yes.
23
Q.
Did she prescribe any medications for you?
24
A.
Yes.
25
Q.
Were those medications Medrol and Flexeril?
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
A.
Yes.
2
Q.
Did she instruct you to return to your chiropractor
3
for further therapy?
4
A.
Yes.
5
Q.
Did she mention to you that you needed to have
6
injections on your low back?
7
A.
Yes.
8
Q.
Did you return to Plano Injury Rehab for treatment on
9
May 27th, May 28th, June 1st and June 4th?
10
A.
Yes.
11
Q.
And then did you have any testing with Action
12
Diagnostic?
13
A.
Yes.
14
Q.
And did they find that you had a moderate disability?
15
A.
Yes.
16
MR. ABBOTT:
Your Honor, we would ask that
17
Plaintiff's Exhibits 13 and 14, which are the records and bills
18
from Action Diagnostics, be admitted.
19
THE COURT:
20
MR. ABBOTT:
They're admitted.
Thank you, Your Honor.
21
Q.
And, lastly, did you go back to the hospital at RHD?
22
A.
Yes.
23
Q.
Was that on April 8th of this year?
24
A.
Yes.
25
Q.
And did you mention that you had severe back pain
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
2
from your auto accident of February 23rd, 2010?
A.
3
4
MR. ABBOTT:
7
We ask that Plaintiff's Exhibit 15 be
admitted, which are the records from RHD Medical Center.
5
6
Yes.
THE COURT:
Q.
It's admitted.
So in total we've submitted to the Court
medical bills of a total of $14,368?
8
A.
Yes.
9
Q.
Do you believe that those are reasonable?
10
A.
No.
11
Q.
Why is that?
12
A.
Because I still need to get some more treatment.
13
Q.
Okay.
14
For the past then, do you believe that's a
reasonable amount?
15
A.
Yes.
16
Q.
Do you believe this treatment was necessitated by
17
this accident?
18
A.
Yes.
19
Q.
In fact, do you believe that these injuries were
20
caused by the accident?
21
A.
Yes.
22
Q.
Why do you believe that?
23
A.
Because I've never been in such pain, since the
24
25
accident.
Q.
Do you have an understanding whether you're going to
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
have to have medical treatment in the future?
2
A.
Yes.
3
Q.
What type of medical treatment are you going to need
4
5
6
in the future?
A.
I'm going to go back to the specialist, back
specialist, and get some injections.
7
Q.
What's the reason that you haven't gone now?
8
A.
Money and insurance.
9
Q.
If you would tell Judge McFarlin about the money and
10
11
insurance.
A.
Okay.
I got laid off.
I had been with my office for
12
ten years.
13
doctors left, so that's why they laid me off.
14
lot in reference to the accident.
15
to tell me that they laid me off for that reason.
16
talk to my manager, but he said they had to lay me off because
17
of the income, their budget.
18
keep going.
19
They're saying that the doctor -- one of the main
I had been out a
Of course, they're not going
I did try to
Now I don't have insurance to
I did call my doctor, she is my doctor, and I asked her --
20
actually, she is still filling my medications.
21
that's real sweet of her because I need to go back, she says,
22
to see her, but I don't have no insurance.
23
Q.
And again
Would it be fair to say since this accident happened
24
you were laid off from your job and your health insurance
25
terminated?
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
A.
Yes.
2
Q.
So you're waiting to use the money you receive from
3
this lawsuit to get the rest of your medical treatment?
4
A.
Yes.
5
Q.
And do you have an idea of how much your medical
6
treatment in the future is going to be?
7
A.
No.
8
Q.
At some point you've talked to your doctor about
9
getting injections?
10
A.
Yes.
11
Q.
And getting surgery?
12
A.
Yes.
13
Q.
What is your understanding of how much the future
14
15
medical bills would be for that?
A.
I don't know.
He is a specialist, but he told me
16
that he was going to start with injections.
17
injections doesn't work, then we will talk about surgery on my
18
back.
19
20
Q.
Then if the
So are you going to ask the Judge to set aside
$85,000 for your future medical care?
21
A.
Yes.
22
Q.
Have you been in pain as a result of this accident?
23
A.
Yes.
24
Q.
On a scale of 0 through 10, how would you describe
25
Yes, I have.
the pain?
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
2
3
4
A.
8.
Like my back right now, I can't even stand this
long.
Q.
So ever since the date of the accident until now
you've been in pain?
5
A.
Yes.
6
Q.
And you're in pain right now?
7
A.
Yes.
8
Q.
Your pain is in your low back right now?
9
A.
Yes.
10
Q.
Are you asking the Court to award $100,000 for your
11
past pain?
12
A.
Yes.
13
Q.
Do you think you're going to be in pain into the
14
future?
15
A.
Yes.
16
Q.
Why do you believe that?
17
A.
Because I've been in pain ever since my accident.
18
Q.
Is that also based on your understanding of your
19
consultation with your doctors?
20
A.
Yes.
21
Q.
It's your understanding, based on your consultation
22
with them, that you'll have pain for the rest of your life, is
23
that right?
24
A.
Yes.
25
Q.
So you're asking the Judge to award $300,000 for
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
future pain?
2
A.
Yes.
3
Q.
Have you been unable to do activities around the
4
house as a result of this accident?
5
A.
Yes.
6
Q.
If you would tell the Judge the activities that you
7
8
9
10
11
12
13
haven't been able to do.
A.
Just the normal -- I can't vacuum.
my carpet no more for sure.
I can't shampoo
Washing dishes, I have to do it
real quick, because I can't stand a long time.
When I wash clothes, pulling out the clothes from the -- I
can't do that either.
My husband has been very supportive ever since I had the
14
accident.
He has been doing a lot of work around the house.
15
Folding.
16
That's the way I feel because a woman has to clean and that's
17
the -- I like doing that.
18
having a hard time -- I did hire somebody to come and help me,
19
you know.
It's just, I mean, my whole life just is gone, to me.
I'm a very clean person, too, so I'm
20
Q.
Are you able to mop?
21
A.
No, no, I cannot mop.
22
I cannot clean the tub, I
can't bend over to clean the tub like I used to.
23
Q.
Are you able to garden?
24
A.
No, I cannot.
25
Q.
Do you have grandkids?
I tried that already this past summer.
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
A.
I have two grandchildren.
And the first thing that
2
my doctor said is do not pick them up.
3
they were still little, and I was taking care of them on
4
Saturdays for my daughter, because she goes to school full time
5
and works on the weekends.
6
grandchildren on the weekends, so my doctor told me do not lift
7
those babies.
8
9
10
11
12
13
14
Q.
When I had the accident
She knew I was taking care of my
Prior to the accident did you do swimming for
exercise?
A.
Yes, sir, this summer -- my summer was just gone.
I
swim every summer, I do laps and everything, that was gone.
Q.
Now, as a result of this accident, was it more
difficult for you to work while you were working?
A.
Oh, yeah, yeah, definitely, especially when I have to
15
take my medication that I didn't want to take, then my pain was
16
hurting.
17
I couldn't take the pain medication because I couldn't
18
concentrate, because it made me sleepy and stuff, a little bit
19
of everything.
20
21
Q.
When I'm sitting down a long time, I'm in pain.
Then
I think that's probably why they laid me off.
So are you asking the judge to award you $100,000
for your impaired activities in the past?
22
A.
Yes.
23
Q.
Are you asking the Judge to award $200,000 for the
24
25
activities that you won't be able to do into the future?
A.
Yes.
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
Q.
Is your understanding that you won't be able to do
2
these activities in the future based on your consultation with
3
your medical providers?
4
A.
Right.
5
Q.
Again, you believe your impairment, past and future
6
pain and suffering, past and future, was caused by this
7
accident?
8
A.
Yes.
9
Q.
And why do you believe that?
10
A.
Because I haven't had any kind of pain like this
11
since the accident.
I mean, I can't sleep at night, I have to
12
take sleeping pills to sleep.
13
accident.
14
health.
That's why I know it was the
I was in great shape.
15
MR. ABBOTT:
16
THE COURT:
I've always been in good
Nothing further, Your Honor.
Can you tell me about Martin
17
Transportation Systems and Charles Moffitt and their
18
relationship?
19
MR. ABBOTT:
20
is the driver.
21
vehicle.
22
According to the police report, Moffitt
Martin Transportation is the owner of the
The Court has previously granted default judgment against
23
the driver only.
We're asking the Court to grant a default
24
judgment against Martin Transportation Systems, Inc., and to
25
grant our judgment -- damages against the driver and judgment
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
2
3
4
5
6
against the vehicle owner.
THE COURT:
On what do you base the negligent
entrustment?
So you don't know if Charles Moffitt was an employee of
Martin Transportation?
MR. ABBOTT:
We believe he was.
On the police report
7
it shows that they own the vehicle, and that he drove the
8
vehicle for them.
9
10
THE COURT:
But you weren't able to find out whether
or not he was an employee?
11
MR. ABBOTT:
12
THE COURT:
No.
Because you say there was negligent
13
entrustment, yet you would have to make some sort of
14
allegations that they knew -- well, you did make the allegation
15
that they knew or should have known.
16
an employee.
17
18
19
MR. ABBOTT:
I wish we knew if he was
Did he say he worked for them?
Let me develop it, actually.
THE WITNESS:
Actually, the guy talked to my husband
20
after the accident, and he just said that he had seen me -- he
21
was trying to talk to my husband, but he said that he worked
22
for that company.
23
That they worked for that company, they were the drivers.
There was another lady there also with him.
24
THE COURT:
Okay.
25
THE WITNESS:
He said he was an employee, he told my
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
husband --
2
3
THE COURT:
All right, that's a better basis, I
think.
4
You're not attempting to get lost future wages?
5
Off the record.
6
Loss of earning capacity.
7
Q.
8
Ms. Vasquez, do you believe that this diminished your
ability to work?
9
A.
Yes.
10
Q.
Okay.
11
Yeah.
In the past how much do you believe that you
lost from your inability to work?
12
A.
Okay.
13
Q.
Between the accident and today.
14
A.
And today.
15
As I said, after the accident --
Oh.
to get up, just everything.
16
THE COURT:
17
THE WITNESS:
18
When were you terminated?
THE COURT:
20
THE WITNESS:
21
THE COURT:
22
THE WITNESS:
23
THE COURT:
25
Like -- it's going to be about a month
ago.
19
24
It's really hard, it's hard for me
How much did you make a month?
About 3,400.
Was that net?
Net.
It was net.
How old are you?
THE WITNESS:
55.
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
THE COURT:
2
would be able to do?
Can you imagine any type of job that you
3
THE WITNESS:
4
THE COURT:
5
THE WITNESS:
6
THE COURT:
7
THE WITNESS:
At this point, probably not.
Only if you're laying on your back?
Yeah.
I did not -Even if I'm laying on my back, I was
8
telling him, even if I lay for awhile, because my back starts
9
hurting, I have to turn to the right and to the left.
I turn
10
all night.
11
mean, just like my life is like gone.
12
health.
13
like, Gee, Mom, I've never seen you like this.
14
year old is out shampooing my carpet right now because he knows
15
I can't do it any more.
16
My husband is just irritated about that, too.
I was in such good
I've always worked, was a go-getter.
THE COURT:
I
Now my kids are
Actually, my 27
Everything seems to be in order except
17
for in the Original Petition it does not -- when you serve an
18
out-of-state Defendant by Secretary of State you have to say
19
certain words, and those words are this.
20
by serving their home or home office address.
And you don't
21
say that, you just say this is their address.
So that's the
22
only thing that needs to be fixed before I can -- well, also I
23
don't think I saw a certificate of last known address for
24
Martin Transportation.
25
MR. ABBOTT:
They should be served
We do have that, that was attached to
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
the original motion for default judgment.
2
THE COURT:
You have two?
I only have one motion for
3
default judgment, it was filed on 10-28.
4
another one?
5
6
7
MR. ABBOTT:
You say there was
Well, let's see.
This is the one that has Defendant Martin Transportation
Systems, Inc., the one on the 28th.
8
THE COURT:
9
for Charles Moffitt.
Actually, mine says that it was the one
That's the only thing that you need to
10
change.
Actually, you can -- you don't have to have it in the
11
petition itself, it's in the record anyway, it will suffice.
12
So if you know for a fact that is their home address, then you
13
can actually do it by hand, if you wanted to.
14
MR. ABBOTT:
15
THE COURT:
Very well.
You just need to put the cause number and
16
the style of the case, and then that certificate, and then I
17
will grant your judgment.
18
MR. ABBOTT:
19
THE COURT:
20
MR. ABBOTT:
Yes.
21
MR. ABBOTT:
This was against the individual
22
23
24
25
Defendant.
Great, thank you, Your Honor.
Do you have a proposed order?
This was against the Defendant.
THE COURT:
I just want to do it in one order, one
judgment, one final judgment.
MR. ABBOTT:
Do you want me to interlineate with the
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
2
3
amounts, too?
THE COURT:
If you would like, that's fine.
END OF PROCEEDINGS
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
'HIDXOW3URYHXS
3DJH
1
THE STATE OF TEXAS
2
COUNTY OF DALLAS
3
4
I, SHARRON RODRIGUEZ RANKIN, Official Court Reporter in and
5
for the 160th Judicial District Court of Dallas County, State
6
of Texas, do hereby certify that the above and foregoing
7
contains a true and correct transcription of all portions of
8
evidence and other proceedings directed in writing by counsel
9
for the parties to be included in this Volume of the Reporter's
10
Record in the above styled and numbered cause, all of which
11
occurred in open court or in chambers and were reported by me.
12
I further certify that this transcription of the
13
proceedings truly and correctly reflects the exhibits, if any,
14
offered by the respective parties.
15
I further certify that the total cost for the preparation
16
of this Reporter's Record is $150 and was paid by Fee, Smith,
17
Sharp & Vitullo, LLP.
18
WITNESS my hand this the 4th day of April, 2011.
19
20
21
22
23
24
/s/
_______________________
SHARRON RODRIGUEZ RANKIN
Official Court Reporter
Certificate Number 1082
Expiration Date: 12-31-12
160th District Court
6th Floor Allen Courts Bldg.
Dallas, Texas 75202
(214) 653-6938
25
6KDUURQ55DQNLQ&65WK'LVWULFW&RXUW
'DOODV7H[DV
fecfc7c2-6c23-11e0-8ce9-0040d00d6ccb
05-11-00359-CV
REPORTER'S RECORD
VOLUME 3 OF 4 VOLUMES
TRIAL COURT CAUSE NO. DC-10-07245-B
APPELLATE NO. 05-11-00359-CV
2
3
4
ADELINA VASQUEZ
5
6
VS
7
CHARLES E. MOFFITT AND
MARTIN TRANSPORTATION,
INC.
8
*
*
*
*
*
*
*
*
IN THE DISTRICT COURT OF
DALLAS COUNTY, TEXAS
44TH JUDICIAL DISTRICT
9
10
11
12
13
14
15
16
________________________________________________
DEFENDANTS' AMENDED MOTION FOR NEW TRIAL,
MOTION TO VACATE DEFAULT JUDGMENT &
MOTION FOR EXPEDITED/EMERGENCY HEARING
________________________________________________
17
18
19
20
On the 28th day of February, 2011, the following
21
proceedings came on to be heard in the above-entitled
22
and numbered cause before the Honorable Carlos Cortez,
23
Judge presiding, held in Dallas, Dallas County, Texas;
24
25
Proceedings reported by machine shorthand.
LINDA VERA, CSR
DEPUTY OFFICIAL COURT REPORTER
5th Court of Appeals
FILED: 04/25/2011
12:21:55
Lisa Matz, Clerk
1
1
2
1
A P P E A R A N C E S
2
FOR THE PLAINTIFF:
3
MR. NILES S. ILLICH
BEN ABBOTT, P.C.
SBOT NO. 24069969
1934 Pendleton Drive
Garland, Texas 75041
Phone: 972.263.5555
4
5
6
7
FOR THE DEFENDANTS:
8
MR. MICHAEL P. SHARP
SBOT NO. 00788857
MR. CLAY A. COSSE, JR.
SBOT NO. 24071246
FEE, SMITH, SHARP & VITULLO, L.L.P.
Three Galleria Tower
13155 Noel Road
Suite 1000
Dallas, Texas 75240
Phone: 972.934.9100
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
LINDA VERA, CSR
DEPUTY OFFICIAL COURT REPORTER
3
1
2
3
CHRONOLOGICAL INDEX
VOLUME 3 OF 4 VOLUMES
DEFENDANTS' AMENDED MOTION FOR NEW TRIAL,
MOTION TO VACATE DEFAULT JUDGMENT &
MOTION FOR EXPEDITED/EMERGENCY HEARING
4
February 28, 2011
5
Page
Vol.
6
Case Called ..............................
5
3
End of Proceedings .......................
49
3
Court Reporter's Certification ...........
50
3
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
LINDA VERA, CSR
DEPUTY OFFICIAL COURT REPORTER
4
1
EXHIBIT INDEX
2
PLAINTIFF'S
3
NO.
DESCRIPTION
4
OFFERED
ADMITTED
VOL.
OFFERED
ADMITTED
VOL.
(NONE MARKED.)
5
DEFENDANTS'
6
NO.
DESCRIPTION
7
8
(NONE MARKED.)
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
LINDA VERA, CSR
DEPUTY OFFICIAL COURT REPORTER
5
1
P
R
O
C
E
E
D
I
G
S:
2
(February 28, 2011; 3:05 p.m.)
3
THE COURT:
Court calls Cause No.
4
10-07245-B.
We're here on Defendants' Amended Motion
5
for New Trial, Motion to Vacate Default Judgment, Motion
6
for Expedited/Emergency Hearing.
7
Who's going to start?
8
MR. SHARP:
Your Honor, we will.
9
THE COURT:
Okay.
10
MR. SHARP:
Mike Sharp for the defendants.
11
Clay Cosse is also here for the defendants.
12
Your Honor permits, I'd like to just start with a
13
general background and time line on this.
14
the extent the Court has questions about specific
15
authority cited in our motion, Mr. Cosse will brief that
16
and will be happy to address that with the Court.
17
If
And then to
Your Honor, again, we are here on
18
defendants' motion, and an amended motion for new trial,
19
and motion to vacate a default judgment.
20
general understanding of the time line is crucial to --
21
to understand our contentions on why the new trial
22
should be granted and the default should be set aside.
23
And I think a
Everything, of course, starts with the
24
accident.
The accident made the basis of this suit
25
occurred February 23rd of 2010.
The next event that
LINDA VERA, CSR
DEPUTY OFFICIAL COURT REPORTER
6
1
occurs, Your Honor, is the petition is filed.
2
plaintiff's petition was filed in -- with your court on
3
June 16th of -- of 2010.
4
contend that there were improper attempts to perfect
5
service on my client, Martin Transportation.
6
The
On July 26th of 2010, we
The service that was attempted on Martin
7
Transportation was done via secretary of state.
Now, in
8
some instances, that is proper service.
9
authorities that we have cited on page 4 of our amended
But under the
10
motion, it's established that a default judgment after
11
substituted service on a secretary of state cannot stand
12
absent evidence from the plaintiffs of a reasonable --
13
of reasonable diligence in attempting services on the
14
registered agent first.
15
In this case, Martin Transport, the
16
defendant, my client, does have a registered agent for
17
service of process in Texas.
18
include a page out of the Motor Carrier Safety
19
Administration Web site as well as a listing of our
20
registered agent here in Texas.
21
The exhibits to our motion
There's no evidence that we've seen
22
anywhere in the record that there was any effort and any
23
reasonable diligence on the part of the plaintiffs to
24
attempt to serve that designated agent before the
25
secretary of service was served.
So at first blush,
LINDA VERA, CSR
DEPUTY OFFICIAL COURT REPORTER
7
1
very close to the top of the time line.
2
an incident where we do not believe there is proper
3
service on the party, and, of course, that would render
4
a default -- default judgment on its face.
5
We've got a --
We continue on -- on September 3rd, 2010.
6
There was attempts to perfect service against
7
Mr. Moffitt.
8
Transportation.
9
affidavit of service that indicates that the process
Now -- and that's the driver for Martin
Now, Mr. Moffitt -- there is an
10
server delivered the citation to his home.
11
appears to be an absence of evidence as required under
12
the authority cited on page 6 of our motion that Moffitt
13
was personally served; that it was actually handed to
14
Mr. Moffitt at his home.
15
There
Eventually after these services were done,
16
these attempted services that we contend were improper
17
were done, Martin Transportation, my client, did get a
18
copy of some suit papers.
19
forwarded to their TPA.
20
third-party administrator, as many companies and
21
trucking companies do, and their TPA is served with --
22
is charged with responsibility for then processing the
23
suit papers, assigning them to defense counsel so that
24
timely answers can be filed.
25
Those suit papers were
Martin works through a
We have attached affidavits in our papers
LINDA VERA, CSR
DEPUTY OFFICIAL COURT REPORTER
8
1
filed with Your Honor that show Martin Transportation
2
forwarded those suit papers on to their TPA.
3
affidavit from the TPA on the flip side of that
4
transaction showing they did not get into the litigation
5
intake.
6
intake unit so that deadlines were established, defense
7
counsel was assigned and timely answers could be filed.
In other words, they did not get into the
8
9
We have an
We have affidavits from Mr. Mauro who was
with Martin Transportation.
We have an affidavit from
10
Mr. Arbour who was with the TPA, Gallagher Bassett.
11
we contend that these clearly show that there is no
12
conscious indifference on the part of my client;
13
certainly no intentional failure to file an answer.
14
was, in fact, a mistake.
15
where it did not go through the proper -- proper
16
channels.
17
And
It
It was an administrative thing
The next thing, we get to the time line.
18
And the time line, Your Honor, is October 28th of 2010.
19
On that date, plaintiffs take an interlocutory default
20
judgment, which did not specify damages.
21
think it's disputed that that judgment was, in fact,
22
interlocutory.
23
liability.
24
25
And I don't
It didn't -- all it addressed was
No damages.
That interlocutory judgment or motion for
that interlocutory judgment was not served on my party
LINDA VERA, CSR
DEPUTY OFFICIAL COURT REPORTER
9
1
pro se.
I'm not saying it's necessarily required if no
2
answer is yet on file, but it was not served or notice
3
was not provided to my client.
4
We then get to the date of November 12th,
5
2010.
6
retained.
7
default judgement is taken.
8
November 15th, 2010, Clay Cosse, who is prepared to
9
testify under oath as an officer of the Court, has a
10
And that's the date, Your Honor, that we're
So we are retained after that interlocutory
Three days later on
personal conversation --
11
Is it Jennifer?
12
MR. COSSE:
Right.
13
MR. SHARP:
-- with Ms. Jennifer Kashar,
14
who is one of the attorneys of record for the plaintiffs
15
in this case.
16
15th, 2010.
17
Mr. Abbott's office over here.
18
cases and have informal conversations about extensions
19
of discovery and typical things in a litigation.
20
They have this conversation on November
We have a pretty big volume of cases with
We regularly discuss
Clay had a -- Mr. Cosse had a conversation
21
with Ms. Kashar on that date of November 15th.
The
22
conversation essentially included the statements of,
23
Hey, we were just retained on this case.
24
y'all have a default judgment.
25
of the time and expense of filing necessary motions to
I understand
Before we go through all
LINDA VERA, CSR
DEPUTY OFFICIAL COURT REPORTER
10
1
set aside and having hearings and -- and you trying to
2
overcome the very high standards under Craddock, can we
3
get this voluntarily set aside?
4
There is an agreement that it can be
5
voluntarily set aside if we can agree to attorney fee
6
reimbursement.
7
We said, How about 750?
8
back to you on that.
9
And at that time, Ms. Kashar said 1,500.
And Mr. Kashar said, I'll get
Despite several follow-ups, we didn't get
10
any further response to what we thought was a -- an
11
agreement in principle at that time.
12
later -- that conversation is on the 15th of November --
13
THE COURT:
Instead, two days
You think there was an
14
agreement in principle although the attorney's fees had
15
not been resolved?
16
MR. SHARP:
There -- there certainly was an
17
assumption on our part that we were going to be able to
18
work out the default issue; we are going to be able to
19
get that set aside once we agreed on a figure.
20
those figures were already discussed between the
21
parties.
And
That conversation occurs two days later.
22
November 17th of 2010, the Court's record
23
reflects that plaintiff's counsel then files damages
24
affidavits.
25
any notice to my client or to my firm.
These affidavits are filed again without
We get to
LINDA VERA, CSR
DEPUTY OFFICIAL COURT REPORTER
11
1
November 19th of 2010, so two days after that, and,
2
again, despite the knowledge from Mr. Abbott's office
3
and from his associates that we are involved, there's a
4
hearing four days later, an evidentiary hearing, where
5
damages -- evidence is put on where the -- the
6
unliquidated damages are sought to be proved up.
7
Again, no service, no telephone call, no
8
notice of any kind that that hearing is taking place or
9
that evidence is being presented or motions had been
10
filed for a final default judgment.
11
evidence is put on.
12
of $20,000 in medical affidavits for the total amount
13
of -- right short of $800,000.
14
Your Honor was present during that hearing.
15
someone else may have sat in based on the Court's
16
record, but I'm not sure on that.
17
place on the 19th.
18
Instead, some
A default judgment is entered off
And I don't believe
I think
So that hearing takes
We have requested the Court's entire record
19
since all of this has transpired.
We have asked for the
20
transcript from that hearing.
21
reporter was assigned to it, but we have been told that
22
no transcript exists for that particular hearing.
23
again, under the Rules, the absence of a record to prove
24
up all of those damages in and of itself would be
25
grounds for a new trial.
We have seen that a court
LINDA VERA, CSR
DEPUTY OFFICIAL COURT REPORTER
And,
12
1
November 19th, 2010, the final default
2
judgment is entered without defendants being present.
3
We didn't get notice.
4
We have got an affidavit, which we have -- we have
5
filed, that my client did not receive notice of that
6
final default judgment.
7
Court's record from the clerk of court addressed to
8
plaintiff's counsel and addressed to my clients in their
9
individual capacity.
10
We didn't get service of that.
There is a letter in the
But what there is not is any entry
in the Court's register of actions or docket sheet.
11
And if Your Honor doesn't have ready access
12
to this, I'll be happy to -- to bring it up to you to
13
let you see it.
14
But there is no entry in the docket sheet
15
or the registry of actions that that notice was, in
16
fact, mailed out to my client.
17
Under Rule 239(a) of the Texas Rules of
18
Civil Procedure, it states in part the clerk shall mail
19
written notice thereof to the party against whom
20
judgment was rendered at the address shown in the
21
certificate and note the fact of such mailing on the
22
docket.
23
relates to the final default judgment that was taken.
24
So, again, I believe that that would render the judgment
25
itself void as a matter of law.
That is not anywhere on the docket sheet as it
LINDA VERA, CSR
DEPUTY OFFICIAL COURT REPORTER
13
1
Setting aside, Judge, just for a minute
2
the -- the Rules of Civil Procedure on this and setting
3
aside for a minute the case law that supports our
4
contention, I would like to -- to state on the record in
5
light of this conversation that occurred between my
6
office and Mr. Abbott's office, in light of the clear
7
fact that we were involved in representing the parties
8
back on November 15th prior to this evidentiary hearing
9
taking place, prior to these damages affidavits being
10
filed, prior to this final judgment being taken, all the
11
lawyers and the Court should be aware of the -- the
12
Lawyer's Creed that everyone takes.
13
Lawyer heading, Roman number III, number 11, it
14
specifically states:
15
causing any default or dismissal to be rendered, when I
16
know the identity of an opposing counsel, without first
17
inquiring about that counsel's intention to proceed.
18
And under Lawyer to
I will not take advantage, by
We got no phone call.
We got no letter.
19
We got no e-mail saying we had this conversation the
20
other day.
21
aside a default, but we don't believe it's true.
22
going forward with the hearing.
23
our defenses.
24
we move forward, Your Honor, from there.
25
Y'all may think we have an agreement to set
We're
We're going to prove up
We're going to get a final judgment.
So
We get to the date of January 7th, 2011.
LINDA VERA, CSR
DEPUTY OFFICIAL COURT REPORTER
14
1
At this time, again, without any notice to my firm or my
2
client, there is a writ of execution issued based upon
3
the final default.
4
Mr. Abbott's office.
5
going on with this and why we're not hearing anything
6
about potentially setting this aside voluntarily by
7
monitoring the Court's docket sheet.
8
we realized for the first time on February 4th that a
9
final default judgment was, in fact, taken.
10
We don't get anything from
Instead, we have to monitor what's
And at that time,
Four days later on February 8th, we filed
11
defendants' motion, our original motion for new trial
12
and to set aside.
13
days later on February 11th.
14
amended motion on February 28th as we got the Court's
15
actual record and we were able to verify what was in it
16
and what was not.
17
We filed our amended motion three
And we file our most
So that's the time line.
I won't belabor
18
the Court with this -- the judicial -- with the legal
19
standards for a set aside other than to address I think
20
the -- the serious matters and contention.
21
both the interlocutory judgment and the final judgment
22
are deficient in -- in several respects and it should be
23
set aside.
24
25
We contend
Again, number one, the service on Martin
Transportation was not properly perfected under the
LINDA VERA, CSR
DEPUTY OFFICIAL COURT REPORTER
15
1
Texas Business Corporation's Act, Article 2.211.
2
made on secretary of state without any due diligence in
3
trying to serve the registered agent.
4
It was
Number two, under Rule of Civil Procedure
5
21 there is nothing -- no indication that any service or
6
notice was given of multiple motions and hearings.
7
certainly there is a question about compliance with
8
the -- with the Lawyer's Creed provision I read to you
9
as well as Rule 4.02 of the Rules of Professional
And
10
Conduct.
11
when a party knows another party is represented,
12
communication should go through counsel.
13
whether of -- whether they made appearance, if you know
14
another party is represented, you shouldn't communicate
15
directly with a client nor should you have anyone else,
16
including representatives of the government, the Court,
17
communicate directly with that party.
18
maintain notice was never received of these judgments,
19
the attempts to do so were done without our involvement.
20
21
22
23
24
25
And that's the rule, Your Honor, that requires
Regardless of
And although we
The fourth main item, the Craddock
standards.
THE COURT:
You don't need -- you don't
need to get into that.
MR. SHARP:
Yeah.
The Court is well aware
of what the Craddock standards are.
We content --
LINDA VERA, CSR
DEPUTY OFFICIAL COURT REPORTER
16
1
THE COURT:
Unless there's -- unless
2
there's something in addition to the papers that you
3
want to point out.
4
MR. SHARP:
In addition to what,
6
THE COURT:
What you filed.
7
MR. SHARP:
I think the only additional
5
Your Honor?
The papers.
8
things -- you've got the affidavits that -- that show it
9
wasn't intentional or a conscious indifference.
You've
10
got the affidavits on the meritorious defense.
11
got the indications that there's going to be no undue
12
delay or -- or prejudice because we have offered and
13
continue to offer reasonable expenses.
14
You've
The case has been pending six months.
15
There's no loss of witnesses or evidence and we're ready
16
to try the case as soon as we can do basic discovery.
17
Your Honor, we contend that -- that the original service
18
was defective, so the judgment itself was void.
19
contend that we have established the Craddock -- the
20
Craddock standards.
21
standards, it would be abuse of discretion not to grant
22
a new trial and set aside the default judgment.
23
24
25
And we
And under those very high
So that's our argument in a nutshell,
Your Honor.
I appreciate your time.
THE COURT:
To confirm your suspicions, you
LINDA VERA, CSR
DEPUTY OFFICIAL COURT REPORTER
17
1
are right.
2
judgment.
3
y'all know that 'cause you attached, I think, in one of
4
your papers the consent to have the associate judge hear
5
the default judgment.
6
This judge did not hear the default
It was done by the associate judge.
I think
The one thing I didn't understand from your
7
argument was that you had -- you made a contention that
8
Moffitt, the driver, was not properly served because he
9
was served at home?
10
11
MR. SHARP:
The -- the -- what's in the
Court's record is that --
12
Can you find that for me, Clay?
13
-- is -- is a notice of service from the
14
process server that indicates that he personally
15
delivered documents to Mr. Moffitt at his home.
16
not specify that -- that the documents were, in fact,
17
delivered to Mr. Moffitt himself as opposed to someone
18
else who may have been at that home.
19
20
THE COURT:
MR. SHARP:
25
There's no substitute
service on the --
23
24
And there was not -- there was
no substituted service 106?
21
22
It does
MR. COSSE:
Motion -- motion is required
MR. SHARP:
Excuse me?
for that.
LINDA VERA, CSR
DEPUTY OFFICIAL COURT REPORTER
18
1
MR. COSSE:
Motion is required for that --
2
THE COURT:
Yeah, I know.
MR. COSSE:
Right.
3
asking --
4
5
That's why I was
Right.
No.
There was
no motion filed.
6
THE COURT:
Okay.
And I do not recall
7
seeing the Court's record in any of your papers.
8
said you had a copy of the Court's record?
9
10
MR. SHARP:
You
Do you -- do you mean the
docket sheet or register of action?
11
THE COURT:
Yeah.
12
MR. SHARP:
Can I bring that up to you,
14
THE COURT:
Sure.
15
All right.
Let me hear from opposing
13
16
Your Honor?
Thank you.
counsel.
17
MR. ILLICH:
Your Honor, may I approach?
18
This is the response that we filed this morning and I
19
gave it to counsel previously.
20
THE COURT:
21
MR. ILLICH:
22
THE COURT:
23
24
25
copy of it.
Yeah.
Did you e-file it or...
No, sir.
I --
Oh, you just -- I didn't get a
That's why I was asking.
MR. ILLICH:
Your Honor -- Your Honor,
generally I agree with the facts that the opposing
LINDA VERA, CSR
DEPUTY OFFICIAL COURT REPORTER
19
1
counsel provided in terms of the accident occurring.
2
We -- we did -- I disagree with him, however, on service
3
in two regards.
4
First of all, we made a diligent search for
5
registered agent in Texas.
We did not find one.
After
6
failing to find one, we served one through the secretary
7
of state.
8
Moffitt, the driver, says that on September 3rd, 2010,
9
I, the process server, personally delivered said
Also, the affidavit of service on Charles
10
documents to Charles Moffitt at his -- at 305 Harmon
11
Road, Hurst, Texas, which I assume to be his address.
12
And I believe that is Exhibit K in the -- in the
13
response.
14
THE COURT:
15
look at it, please.
16
handed this to me, so...
MR. ILLICH:
18
THE COURT:
20
Let me take a
'Cause I just -- I mean, you just
17
19
Just a second.
Sure.
No problem.
All right.
It seems to do away
with the Moffitt issue.
What is your response to -- where is the
21
diligence that you exercised in trying to find the agent
22
for service as to Defendant Martin Transportation?
23
MR. ILLICH:
We got -- we had our -- our
24
clerks do the normal search that they always do.
25
looked for it.
We
They came back and reported that it
LINDA VERA, CSR
DEPUTY OFFICIAL COURT REPORTER
20
1
wasn't there.
2
And when it wasn't there, we didn't -- we just sent
3
notice to the secretary of state.
4
5
THE COURT:
MR. ILLICH:
I don't -- I don't have an
exhibit on that, Your Honor.
8
9
And where is that in your
exhibits?
6
7
Jennifer Kashar and I worked together.
THE COURT:
Okay.
You're just saying you
did?
10
MR. ILLICH:
11
THE COURT:
12
MR. ILLICH:
Yes, sir.
Okay.
We're -- we're not who --
13
we're not even aware of who the registered agent is to
14
this day.
15
serve through the secretary of state.
16
that that this motion is -- is untimely, that the Court
17
really lacks plenary power to hear this.
18
opposing counsel said, that we do have two default
19
judgments here:
20
November.
21
We're of the opinion there isn't one and we
However, we feel
As the
One entered in October; one entered in
They received notice of the one in October
22
through us.
They acknowledged that in the affidavit
23
of -- that they provided through Brian Mauro who works
24
for Martin Transportation.
25
provided -- they got notice of that on November 10th,
And then that was
LINDA VERA, CSR
DEPUTY OFFICIAL COURT REPORTER
21
1
which is within 20 days of the entry of the first
2
default judgment.
And then there was a default judgment
3
on November 19th.
They received notice through the
4
Court on December 1st.
5
all parties involved in the lawsuit.
6
any notice that they were the attorney of record.
7
the Court sent it -- I believe that's Exhibit D.
That
8
was sent to all parties involved in the lawsuit.
And
9
that was sent to the home office of Martin
10
11
All parties -- it was sent to
They hadn't filed
And
Transportation.
Because both default judgments -- because
12
defendants received notice of both default judgments
13
within 20 days of the entry of default judgments, the
14
defendants should have filed their motion for new trial
15
within 30 days of the entry of default judgment.
16
Because they didn't -- didn't do so, it's untimely.
17
Now, they contend that under 306(a)4 --
18
THE COURT:
19
MR. ILLICH:
All right.
-- they're entitled to
20
additional time because they didn't know.
But having a
21
letter from the Court on December 1st saying that the
22
final default judgment had been entered is prima fascia
23
proof that it was sent out.
24
controverting evidence to that that it wasn't sent out;
25
therefore, we believe that both -- that the motion for
There is no -- there is no
LINDA VERA, CSR
DEPUTY OFFICIAL COURT REPORTER
22
1
new trial should have been presented within 30 days of
2
either one of the default judgments.
3
later than at the very late -- latest early
4
January 2011.
5
2011; therefore, untimely.
That makes it no
This wasn't filed until February 8th,
6
Also --
7
THE COURT:
What, if anything, do you
8
believe that 4.02 and the Lawyer's Creed has with
9
respect to whether the Court has plenary power?
10
I'm
just bringing it up 'cause they brought it up.
11
MR. ILLICH:
My -- my answer to that would
12
be that they have not -- they never entered this -- they
13
haven't -- they haven't provided an answer.
14
filed an attorney of record in this.
15
day, they haven't filed an answer in this lawsuit.
16
There is no attorney of record.
17
We did talk with them.
They never
They -- to this
Jennifer Kashar did
18
speak with them I think on January 15th after they
19
entered.
20
judgment --
21
22
We offered to set aside the default
THE COURT:
Do you contest the fact that
Jennifer Kashar talked to Mr. Cosse?
23
Is it Cosse?
24
MR. COSSE:
25
MR. ILLICH:
Cosse.
Yes.
That's in Mr. Cosse's
LINDA VERA, CSR
DEPUTY OFFICIAL COURT REPORTER
23
1
affidavit that they spoke.
2
Jennifer Kashar here, but if Mr. Cosse is going on the
3
stand, I'm happy to ask him that question.
4
in his affidavit --
5
THE COURT:
And so I -- I don't have
But he says
Well, you said -- when you
6
started off your remarks, you said that you agreed
7
generally with the facts that Mr. Sharp had stated.
8
one of those was that there was a conversation between
9
Ms. Kashar and Mr. --
And
10
Is it Cosse?
11
MR. COSSE:
Yes, sir.
12
THE COURT:
If I mispronounce your name,
13
you can call me Lopez the rest of the hearing.
14
That there was a conversation on or about
15
November the 15th with respect to voluntarily set aside
16
as long as the attorney's fees could get worked out.
17
Are you contesting that?
18
MR. ILLICH:
What I -- what I'm contesting
19
is that -- what I meant was, first of all, that I
20
generally agree with the facts about the accident.
21
I -- I do agree that there was a conversation on
22
November 15th -- on or about November 15th between
23
Jennifer Kashar and Mr. Cosse and that that pertained to
24
setting aside -- voluntarily setting aside the default
25
judgment.
They couldn't get that worked out.
LINDA VERA, CSR
DEPUTY OFFICIAL COURT REPORTER
But
24
1
And then on November 23rd, according to
2
Mr. Cosse's affidavit, they were told that we would not
3
set aside the default judgment and that -- and that that
4
was that.
5
fact, ask that the -- that we reconsider that.
6
don't believe there were any further conversations on
7
that particular point.
8
November 23rd, certainly no later than November 23rd
9
that we would not lift the -- we had not voluntarily set
10
That was the end of it.
Mr. Cosse did, in
And I
But they were told on or about
aside the default judgments.
11
THE COURT:
And your response to
12
Mr. Sharp's argument that 306(a) is inapplicable is
13
because the clerk of the court apparently did send a
14
notice of judgment to -- to whom?
15
MR. ILLICH:
It was sent to -- to the home
16
office of Defendants Moffitt and to -- I mean, Defendant
17
Martin Transportation and to Moffitt.
18
Exhibit D.
19
THE COURT:
20
I apologize.
21
MR. ILLICH:
23
THE COURT:
25
D?
You're just going to have to
walk me through it because I just got this.
22
24
I believe that's
No, no.
I'm sorry.
That's all right.
Usually I
like to read and be the third informed party.
MR. ILLICH:
It's Exhibit D, Your Honor.
LINDA VERA, CSR
DEPUTY OFFICIAL COURT REPORTER
25
1
It's a notice of default judgment that went to Martin
2
Transportation at their home office, to Charles Moffitt
3
and to our office.
4
affidavit, he -- he states he was even aware of the
5
service -- the date of service being -- I think it was
6
June 16th that -- that Martin Transportation was served.
7
He states in his affidavit that he was aware of that
8
service date.
9
And, in fact, in Mr. Cosse's
THE COURT:
If the Court were to
10
determine -- let me just hear both of your positions on
11
this 'cause, again, I haven't had a chance to research
12
this and I just got this response handed to me.
13
of the questions that pops to mind is:
14
me that the Court does not have plenary power to set
15
this aside if the Court finds that service was improper
16
as to Defendant Martin Transportation?
17
MR. ILLICH:
But one
Are you telling
Well, Your Honor, it's been 30
18
days since the entry of default judgment.
And at that
19
point, the Court does, in fact, lose plenary power.
20
THE COURT:
In all circumstances?
21
MR. ILLICH:
22
I -- I don't know that -- that -- I don't
In this circumstance.
23
know that I can say it with confidence in every
24
circumstance, but it has been -- it has been a long time
25
since this has been out there.
These -- these things
LINDA VERA, CSR
DEPUTY OFFICIAL COURT REPORTER
26
1
were October and November, 30 days from then, and --
2
and, no, I do not think the Court has plenary power.
3
MR. SHARP:
And, Your Honor, if we could
4
chime in?
5
proper service is not perfected, then the default
6
judgment is void and --
7
8
9
I think the Rule is clear that if -- if the
(Sotto voce discussion between the
attorneys.)
And under 306, I think it makes it clear
10
that the -- the 20 days does not begin to run until
11
there is proper service and a proper default judgment.
12
If the default judgment is rendered void as -- because
13
there's no proper service, then that time line for the
14
court's plenary -- plenary jurisdiction is never
15
triggered in the first place.
16
THE COURT:
Show me that under 306.
17
MR. SHARP:
Yeah.
18
THE COURT:
Seriously, take your time.
19
20
We're trying to --
Y'all have as much time as you want.
MR. SHARP:
And then while we're looking
21
for that, Your Honor, if you don't mind me addressing
22
some of your other points.
23
As far as the due -- the diligence for
24
serving the registered agent, a representation now is
25
one thing, but it has to be -- as the Court is well
LINDA VERA, CSR
DEPUTY OFFICIAL COURT REPORTER
27
1
aware -- when evaluating a record for purposes of --
2
with -- of maintaining a default judgment or considering
3
set aside, it's very strict.
4
favor.
5
due diligence and what was done.
6
7
It's all construed in our
There is no showing on the record itself of that
And then if I could bring this to the
Court.
May I approach, Your Honor?
8
THE COURT:
Yeah.
9
MR. SHARP:
Again, from our history with
10
Mr. Abbott's office -- and I don't think you'll dispute
11
that -- they did quite a bit of litigation against
12
trucking companies.
13
the Web site, the U.S. DOT Web site, where you can get
14
motor carrier details, and then you can also get under
15
licensing and insurance public processed agents for this
16
entity.
17
18
19
It's simply a matter of going onto
THE COURT:
I've seen that.
I think that
was in you papers.
MR. SHARP:
Yeah.
I'm sorry, Your Honor.
20
And if you go down to Texas, you can see that that agent
21
is readily available, so...
22
THE COURT:
Well, I'm just -- I -- that --
23
but my question -- my -- my question, Mr. Sharp, to
24
opposing counsel was assuming that the Court finds that
25
service upon Defendant Martin was improper, how do I
LINDA VERA, CSR
DEPUTY OFFICIAL COURT REPORTER
28
1
retain plenary power?
Because 306 -- and I'm just --
2
just talking out loud, which is sometimes dangerous for
3
judges.
4
whether or not -- correct me if I'm wrong.
5
more with notice and the signing of judgments rather
6
than whether or not service was proper or if the order
7
ultimately or could have been shown to be void because
8
of lack of proper service.
306(a) has -- doesn't have anything to do with
9
MR. COSSE:
It deals
Judge, the -- the case law says
10
that if -- if a -- if no service was -- was ever
11
properly effected, then the judgment is void.
12
it's -- it's of no -- it's of no effect.
13
it's as if nothing happened.
14
be -- right.
So
Essentially
And there'd still only
15
THE COURT:
What -- what case law is that?
16
MR. COSSE:
This Hanover case, Judge.
18
THE COURT:
Is that in your papers?
19
MR. COSSE:
Yes.
17
can approach?
20
memo and support.
21
you an extra copy.
22
I'm sorry.
That was in the amended
Can I have -- I'll hand
Thank you.
THE COURT:
Do you got enough for the
24
MR. COSSE:
Yes, Your Honor.
25
MR. ILLICH:
23
If I
class?
Your Honor, I'm just looking
LINDA VERA, CSR
DEPUTY OFFICIAL COURT REPORTER
29
1
at this U.S. Transportation notice for the first time
2
and it says representative company, representative name,
3
process agents for American Moving & Storage
4
Association, the Martin Transportation out of state in
5
Michigan.
6
but that's under American Moving & Storage Association.
It does list somebody in Texas in Lubbock,
7
MR. SHARP:
And the first -- the first
8
page, if you'll look, says that this business does --
9
it's all within that umbrella.
The legal name, Martin
10
Transportation Systems, Inc., is listed in that first
11
page and then the blanket company at the bottom,
12
Your Honor, is listed as American Moving & Storage
13
Association.
14
And then, Your Honor, I -- I -- the -- the
15
particular rule on the plenary power issue that you were
16
referring to, we cited in our amended motion under
17
arguments and authorities Roman number II.
18
motion, Your Honor, that was filed on February 11th.
19
And 306(a) is the one that addresses the timeliness of
20
the motion for new trial in the beginning of periods.
This is the
21
THE COURT:
All right.
22
MR. SHARP:
And then if you go to number
23
four of 306(a), it says:
If within 20 days after
24
judgment or other appealable order is signed, a party
25
adversely affected by it or his attorney has neither
LINDA VERA, CSR
DEPUTY OFFICIAL COURT REPORTER
30
1
received the notice required by paragraph three of this
2
rule nor acquired actual knowledge, then with respect to
3
that party all the periods mentioned in paragraph one
4
shall begin on the date that such party or his attorney
5
received the first notice or acquired actual knowledge
6
of the signing, whichever occurred first.
7
event shall such periods begin more than 90 days after
8
the original judgment or other appealable order was
9
signed.
10
But in no
So our contention, Your Honor, is based
11
upon the affidavits that are now before the Court.
12
client did not receive the notice of the final judgment.
13
The -- the time lines cannot start from an interlocutory
14
judgment.
15
receive notice of the final judgment, and we only became
16
aware of the final judgment -- we had actual awareness
17
when we checked the Court's docket on the date that we
18
have reflected in our papers.
19
within the time line from that date.
20
They start from the final.
MR. ILLICH:
Our
We did not
And our motion was filed
Well -- and the affidavits
21
they've provided are -- are really inadequate.
22
conclusory.
23
generalizations.
24
under the case law are really not adequate to establish
25
the points that they -- they claim they can -- they do.
They are incomplete.
They are
They provide
They don't provide any specifics and
LINDA VERA, CSR
DEPUTY OFFICIAL COURT REPORTER
31
1
THE COURT:
Well, let's -- let's step back
2
a little bit.
3
receive notice, but under Exhibit E of the plaintiff's
4
response, they have attached the notice of default
5
judgment that was sent by the district clerk to all
6
parties:
7
Mr. Lafitte.
8
9
The -- you -- you state that you did not
Martin Transportation, Moffitt and to
MR. SHARP:
And I think that is where,
Your Honor, we then have to tie back into Rule 239(a),
10
which requires not just a letter in the file, but proof
11
that it was actually received and that there'd be a
12
notation on the docket sheet.
13
docket sheet is clearly absent from what you have in
14
front of there -- in front of you there, Your Honor.
15
And as far as --
16
THE COURT:
The notation on the
Wait.
Wait.
When does the
17
Court ever note that a notice of default judgment was
18
received by -- by whoever they're sending it to?
19
MR. SHARP:
Well --
20
THE COURT:
As you know, they're not sent
21
22
certified mail, so how could that possibly ever happen?
MR. SHARP:
There -- there actually was
23
authority that -- that we cited.
It talks about the
24
notices being sent in the same manner as service such
25
that it's sent registered -- first class mail registered
LINDA VERA, CSR
DEPUTY OFFICIAL COURT REPORTER
32
1
mail I should say, return receipt requested.
2
have an affidavit showing that that was simply never
3
received from -- by our client.
4
MR. ILLICH:
And we
239(a), if I may, Your Honor,
5
is -- is what they called an administrative convenience.
6
It isn't a -- it isn't a requirement.
7
failure -- the Courts have said failure to give notice
8
of the entry of a default judgment doesn't constitute
9
reversible error.
And -- and
It is a -- an administrative
10
convenience for the parties.
11
The requirement is under 306(a)3 where it says:
12
court of the clerk shall give notice -- immediately give
13
notice to the parties or their attorneys of record by
14
first class mail advising the -- advising that the
15
judgment or order was signed.
16
17
It is not a requirement.
The
And that is exactly what the Court did -the Court did on December 1st, 2010.
18
MR. COSSE:
But, Judge, counsel highlighted
19
the points that -- that the -- the notice of judgment --
20
it's prima fascia evidence that the defendants received
21
notice.
22
with the -- with Rule 239 and puts a -- a docket entry
23
signifying that that has, in fact, been done.
24
25
But that's only the case if the clerk complies
There's a docket entry for everything else
that's been done in this case.
There's a docket entry
LINDA VERA, CSR
DEPUTY OFFICIAL COURT REPORTER
33
1
for the -- when the clerk issued citation.
2
docket entry and therefore no evidence that -- I'm
3
sorry -- that the notice of judgment was ever actually
4
sent to the defendants.
5
MR. ILLICH:
There's no
All that's required here is
6
actual notice.
Actual notice occurred when this was put
7
onto the Web site on December 1st, 2009.
8
actually even before that on November 19th when it
9
was -- when it was entered.
It was
The defendants were well
10
aware that a default judgment had already been entered,
11
the one on October 28th.
12
This is out there on the Web site.
13
the Court's file.
14
until Nov -- until January 28th, 2011.
15
obligation to look around and see what's going on.
16
They were already in the suit.
This is available in
They didn't request the Court's file
This is actual notice that's there.
17
sent to the -- it's sent to the parties.
18
to the attorney.
19
It's on the Web site.
20
Web site.
21
They have some
It's not sent
The attorney wasn't on record yet.
Both default judgments are on the
THE COURT:
The Court's register of action
22
does show on November 19, 2010 that there was a
23
correspondence.
24
25
It's
MR. COSSE:
That's the letter from
plaintiff's counsel, Judge, that's in the record.
LINDA VERA, CSR
DEPUTY OFFICIAL COURT REPORTER
34
1
MR. SHARP:
And, Your Honor, also in
2
looking at that particular issue you raised in
3
O'Connor's here when they talk about the note in the
4
docket sheet being required, they go further to say
5
because TRCP 239(a) does not specify the type of notice,
6
the notice must be sent as required by TRCP 21(a) either
7
by personal delivery, receipt of delivery or certified
8
or registered mail.
9
Company v. Davilla 139 S.W.3d 374.
10
And they cite Continental Casualty
THE COURT:
But it does seem in plaintiff's
11
response that the clerk of the court did send it by
12
registered mail pursuant to 21.
13
14
15
16
17
MR. SHARP:
That -- the letter from the
Court regarding that final judgment -MR. COSSE:
The docket entry, Judge, says
letter -- correspondence to file.
THE COURT:
Okay.
So -- and let me -- let
18
me just break it down.
You're -- you're basically
19
stating to me that unless there is a docket entry in the
20
Court's register of actions that that does not
21
constitute notice?
22
MR. COSSE:
That's correct.
23
MR. SHARP:
Well -- well, I'm saying
24
there's not a docket entry as to the notice of the final
25
judgment being sent to our client.
There is a docket
LINDA VERA, CSR
DEPUTY OFFICIAL COURT REPORTER
35
1
entry to that correspondence, which we determined was
2
correspondence with plaintiff's counsel, not with our
3
client.
4
THE COURT:
And the notice of default
5
judgment that they have attached in their response as
6
Exhibit E, you believe that that is insufficient --
7
mailed on or about December 1st, 2010 -- that that is
8
insufficient to satisfy the -- the rule requirement?
9
MR. SHARP:
10
sat down, Your Honor.
11
is.
12
I -- we got the response as we
I'm looking for it.
Yes, Your Honor.
Oh, here it
We're saying that that --
13
that notice does not establish that it was received by
14
our client and in conjunction with the undisputed fact
15
that there is no docket note of mailing that notice in
16
conjunction with a very high burden of proving -- burden
17
of proof that plaintiffs have to maintain this default
18
judgment, I'm saying that the default judgment should be
19
set aside.
20
MR. ILLICH:
First of all, what they
21
presented there is I believe the register of actions
22
from the computer, which is an unofficial version of
23
what's going on.
24
official docket entry.
25
It doesn't qualify as the actual
And further what we have here is the
LINDA VERA, CSR
DEPUTY OFFICIAL COURT REPORTER
36
1
defense counsel has -- has stated in their affidavit
2
that they were aware of the service on November 12th,
3
2010.
4
November 19th default judgment is entered.
5
do anything.
6
know what's going on.
7
forward.
8
Martin and Moffitt.
9
on them and they do nothing.
They are aware of what's going on before the
They don't
They have a willing, knowing action.
They
They know this case is going
They know the date of service on Defendants
10
They admit that there was service
MR. SHARP:
Your Honor, we've acknowledged
11
that on November 12th we knew a default -- a default
12
judgment had been entered.
13
the conversation we had on November 15th where we were
14
discussing a voluntarily set aside.
15
And that was the subject of
In terms of that -- of not doing anything
16
about that, we had those conversations.
17
now established that we believe the service was not
18
perfected against Martin at that time to necessitate a
19
final answer.
20
failure to properly serve Martin.
21
And it's void on its face because of that
MR. ILLICH:
But they were still aware of
22
service on Martin by November 12th, 2010.
23
the November 19th default judgment.
24
25
We have also
THE COURT:
Okay.
That's before
I hate to do this to
y'all, but -- and you don't have to, but if you'd
LINDA VERA, CSR
DEPUTY OFFICIAL COURT REPORTER
37
1
like -- I know y'all are busy.
2
will allow each side to file a letter brief.
3
anybody not do it before noon on Friday?
4
MR. SHARP:
5
MR. ILLICH:
6
THE COURT:
If you want, the Court
Can
We can do it, Your Honor.
We can do it, Your Honor.
Okay.
And this is what I want
7
you to assume.
I want you to assume that this judge in
8
this court believes that the requirements under Craddock
9
are met.
So there's no reason to -- to get into that.
10
I just want you to assume that I think the defendant has
11
satisfied the Craddock test, the three elements that the
12
failure to answer was not unintentional, the defense
13
said something about meritorious defense and that
14
granting a new trial would not result in delay or
15
otherwise injure the plaintiff.
16
I want you to assume that the service on
17
Defendant Moffitt is -- is satisfactory to the Court.
18
What I want a -- a brief on is whether the Court retains
19
plenary power on a default judgment of a case that
20
opposing counsel knew about on or about November 15th as
21
admitted by the parties.
22
23
24
25
And if I'm saying something incorrectly,
speak up.
Hold your -- hold your hand up.
But it seems to be uncontested that on or
about November 15th at opposing -- the defendants knew
LINDA VERA, CSR
DEPUTY OFFICIAL COURT REPORTER
38
1
that there was -- what's that Latin term?
2
term?
3
Legal Latin
Something going on.
So with that understanding and with the --
4
and that there -- apparently there's nothing that I've
5
seen that shows an indication that the clerk of the
6
court noted on the register of actions or in the docket
7
sheet -- and I don't have the docket sheet in front of
8
me -- but assuming that there's nothing on the docket
9
sheet, which is what I think y'all are telling me, that
10
the clerk sent notice of default judgment to all
11
parties, does the fact that the notice of default
12
judgment that plaintiffs have attached in their response
13
as Exhibit E satisfy the rule requirement?
14
But -- but the bigger -- the bigger issue
15
that I have is:
16
plenary power over a case if -- if I determine that the
17
service on Defendant Martin Transportation was improper?
18
And if there is any other issues you want to brief
19
because you think it's important and I'm missing
20
something, let me know.
21
Are you telling me that I don't have
But I got real problems with this.
I mean,
22
I don't know what the -- the evidence was and I don't
23
know what was argued in front of McFarland.
24
all fine and good.
25
$20,000 medical claim gets to $800,000.
And that's
Although, I am very curious how a
LINDA VERA, CSR
DEPUTY OFFICIAL COURT REPORTER
39
1
But I just want to know if there's anything
2
that I can do about it.
3
no evidence before in today's hearing that shows due
4
diligence with respect to ascertaining as to whether or
5
not there was an agent for service on Defendant Martin
6
Transportation.
7
counsel, I don't think that's evidenced.
8
see an affidavit or anything to dissuade me on -- on
9
that issue.
10
And my concern is that there's
With all due respect to argument of
And I don't
But I just want to know if I have the power
11
to do something about this.
12
that you think is important for me to consider prior to
13
a ruling on Friday?
14
15
MR. SHARP:
THE COURT:
MR. SHARP:
19
MR. ILLICH:
23
Okay.
Your Honor, we disagree that
the Craddock test has been met, but we'll --
21
22
I just want to know if I can do
something about it.
18
20
I think those are the issues
we've argued --
16
17
And is there anything else
THE COURT:
it.
Well -- well, let's talk about
What in particular do you think?
MR. ILLICH:
We think that there really are
24
two issues here.
First of all, let me say that the
25
affidavits that they filed --
LINDA VERA, CSR
DEPUTY OFFICIAL COURT REPORTER
40
1
THE COURT:
2
MR. ILLICH:
They're conclusory?
They're conclusory, but
3
they're really inadequate in almost every regard.
They
4
have to show that both they and their agents --
5
defendants have to show both they and their agents can
6
satisfy the Craddock test.
7
say -- just say Exhibit G, which is the affidavit of
8
Brian Arbour who's the only one here for Martin
9
Transportation, he says something like:
And when we look at, let's
To my
10
knowledge, the Martin v. Vasquez suit never went through
11
the Gallagher Bassett's intake procedure for purposes --
12
13
THE COURT:
Almighty?
14
MR. ILLICH:
15
THE COURT:
16
Did you say Exhibit G as in God
Yes, sir.
I don't have Exhibit G.
Exhibit F.
17
Does the defendant have Exhibit G?
18
MR. COSSE:
Yes, Judge.
19
THE COURT:
Which affidavit is it?
20
MR. ILLICH:
21
THE COURT:
22
Of Mr. Arbour.
Okay.
I do have that.
I have
it as Exhibit C.
23
MR. ILLICH:
24
MR. SHARP:
25
I have
That may be in -That's Exhibit C to the amended
motion.
LINDA VERA, CSR
DEPUTY OFFICIAL COURT REPORTER
41
1
2
MR. ILLICH:
Yeah.
And it's -- I just
amended Exhibit G in our -- in ours.
3
THE COURT:
4
MR. ILLICH:
5
THE COURT:
6
MR. ILLICH:
I apologize --
Oh, in yours?
I apologize -That's all right.
-- for not being specific
7
enough, but -- what it says is:
8
Martin/Vasquez suit never went through Gallagher
9
Bassett's intake procedures for purposes of receiving
10
To my knowledge, the
and assigning the suit to outside defense counsel.
11
And it goes on.
It doesn't explain who
12
Brian Arbour is.
13
Gallagher Bassett.
14
knowledge about this.
15
representative for Gallagher Bassett, but it doesn't say
16
that he had, you know -- what his knowledge is in
17
relation to this particular case.
18
any underlying facts, any underlying information about
19
that at all.
20
It doesn't explain his relationship to
It doesn't explain how he has any
He's a senior claims
THE COURT:
It doesn't provide
You don't believe that him
21
being the senior claims representative for Gallagher
22
Bassett in that capacity as senior claims representative
23
and him stating that he has knowledge of the day-to-day
24
operations with respect to claims intake, handling
25
administration of this particular defendant and
LINDA VERA, CSR
DEPUTY OFFICIAL COURT REPORTER
42
1
specifically this specific -- this lawsuit that that's
2
not sufficient?
3
MR. ILLICH:
Well, it's not sufficient.
He
4
doesn't talk about the intake procedure, why there was a
5
failure.
6
Gallagher -- from Martin Transportation to Gallagher
7
Bassett.
8
where he's provided most of his testimony, it's really
9
inadequate and incomplete to satisfy a case law.
10
He doesn't talk about how it gets from
This is really -- in -- in paragraph three
General, vague...
11
MR. SHARP:
And, Your Honor, if I could
13
THE COURT:
Yeah.
14
MR. SHARP:
First, I don't see anything in
12
respond?
15
the response in the way of an objection to the evidence
16
we've presented.
17
standards on this.
18
excuse.
19
it's a fact of the business that some of these motor
20
carriers, a lot of them work through TPAs.
21
communication that has to occur from a risk manager,
22
safety person at a motor carrier over to their
23
counterpart at a TPA, and from that TPA to counsel so
24
that these kind of events don't transpire.
25
Second, the Court's aware of the
Any excuse is not necessarily a good
I think this actually is a good excuse.
The --
There is
And he -- Mr. Arbour has said that he's in
LINDA VERA, CSR
DEPUTY OFFICIAL COURT REPORTER
43
1
a management position with TPA.
2
account.
3
and that this particular case did not get into the
4
normal intake procedure to be assigned to counsel.
5
if it had, we wouldn't be here.
6
7
He works on this
He has personal knowledge about case intake
MR. ILLICH:
And
But it provides no explanation
of what that is, why --
8
MR. SHARP:
9
MR. ILLICH:
10
THE COURT:
And it -- and it --- anything like that.
And if you had argued this to
11
me a week ago, I'm right there with you.
12
a great judge who got reversed last week on this very
13
issue.
14
MR. ILLICH:
15
THE COURT:
But there was
Okay.
It's the Stone case out of the
16
Fifth Court of Appeals and Justice Fillmore wrote the
17
opinion.
18
personal knowledge of stuff and having titles and stuff
19
is not sufficient.
20
be there in order to -- for the Court to -- well, in
21
this case it was a summary judgment against a pro se
22
defendant by the way.
23
president of the company who entered into the actual
24
contract that they were suing on, that that in and of
25
itself wasn't sufficient to support the affidavit.
And it outlines specifically that having
The underlying facts and data has to
And even though this guy was the
LINDA VERA, CSR
DEPUTY OFFICIAL COURT REPORTER
44
1
So let me -- let me do this.
Research it.
2
And instead of, what, noon on Friday, let's just push it
3
back to 2 o'clock on Friday.
4
your position, but I do want to note the Dallas Court of
5
Appeals spanking last week on the Stone case.
6
remember the last name -- the last -- the other party.
7
But they were pretty clear that --
8
9
MR. ILLICH:
I'll -- I'll let you argue
I don't
And -- and the only other
thing I have on that is that he's correct that the
10
Court's been very generous in interpreting what accident
11
or mistake means.
12
affidavits that they provided, they really provided no
13
explanation for their failures to answer after
14
November 15th, 2010.
15
sufficient details up to that point once you cross the
16
time of November 15th, 2010 when they are already aware
17
that service on Martin has occurred.
18
But when you look at these three
They have plenty of details --
There is no explanation for why they have
19
not answered.
All of their affidavits deal with the
20
failure to get this done.
21
affidavits, they say once we pro -- once we provided
22
them with notice of the October default judgment, what
23
happens is that Martin calls Gallagher.
24
Fee, Smith.
25
it was November 12th.
And -- and by -- through the
Gallagher gets
Fee, Smith is then by -- I think it was -Might have been the 15th, but I
LINDA VERA, CSR
DEPUTY OFFICIAL COURT REPORTER
45
1
think it was the 12th.
2
By the 15th, they know of the previous default judgment.
3
They're aware of the date of service on Defendant
4
Martin.
5
point forward in their affidavits that explains why they
6
failed to answer from that point forward.
7
They get the record on the 15th.
And there is nothing in the record from that
MR. SHARP:
And I would offer two quick
8
things on that.
There is things on the record.
The
9
number one thing on the record is we have now determined
10
that we don't believe service on Martin was proper.
11
number two thing about there being a complete absence of
12
any reason why we didn't get an answer on file, we don't
13
believe our party was properly served and we did have
14
something going on.
15
The
What we had going on was a conversation
16
with what we assume to be is a duly-appointed
17
representative of this firm saying we're willing to work
18
with you on this, and then two days later another member
19
of the firm going down and putting on affidavits and
20
having a hearing without even calling counsel --
21
opposing counsel and inquiring about our intention to
22
proceed.
23
THE COURT:
That's -- that's the distinct
24
factor that I don't like.
And that's why I'm asking --
25
but regardless of whether I like it or not doesn't
LINDA VERA, CSR
DEPUTY OFFICIAL COURT REPORTER
46
1
really matter.
2
something about it.
3
on 306 -- based on the fact that the clerk did send you
4
notice on or about December 1st, I don't see where it --
5
again, you'll have to brief it, but I don't see where it
6
has to show that you actually received it.
7
It has to do with whether I can do
And right now I don't see -- based
306 deals with sending it.
Let me -- let
8
me re-read it and make sure I don't sound stupid in
9
front of the second floor.
10
MR. SHARP:
And, Your Honor, in that
11
regard, make sure you look at 306.
12
sections.
13
talk about sending the notice.
14
section.
There's two
And one -- the first section does, in fact,
Look at the very next
It --
15
THE COURT:
That -- that's --
16
MR. SHARP:
-- talks about receipt of the
THE COURT:
At the very next section, it
17
notice.
18
19
has to do with no notice.
20
provided through that Exhibit E or whatever it was that
21
there was notice unless there's some conspiracy you want
22
to allege between the district clerk and Ben Abbott's
23
office.
24
25
MR. ILLICH:
And they have -- they have
I think you're reading on
those exactly right.
LINDA VERA, CSR
DEPUTY OFFICIAL COURT REPORTER
47
1
THE COURT:
I bet you do.
2
MR. COSSE:
Your Honor, there is case law
3
that I've seen that says failure to note the docket
4
entry with a notice of judgment means that the notice of
5
judgment is not proof; that it was actually served or
6
received.
And I'll include that in our belief.
7
THE COURT:
That it was served?
8
MR. COSSE:
Right.
9
When -- when the clerk
fails to -- fails to make the -- the notation on the
10
docket, then there is -- then the notice itself in the
11
docket is not any proof that there was actually -- that
12
the clerk actually did send the notice.
13
THE COURT:
Well, I look forward to
14
receiving that Court of Appeals opinion from Texarkana.
15
If you'll get that to me hopefully by Friday 2:00ish,
16
3 o'clock.
17
the record.
I just -- I don't like the fact that -- off
18
(Off the record.)
19
THE COURT:
20
the record.
21
the record, that's fine.
The Court said some stuff off
If the parties want to address it now on
22
Anybody want to do that?
23
MR. SHARP:
24
MR. ILLICH:
25
THE COURT:
We don't care to, Your Honor.
We're fine, Your Honor.
Okay.
I'm not limiting you to
LINDA VERA, CSR
DEPUTY OFFICIAL COURT REPORTER
48
1
anything on your brief that you need to file -- that
2
I -- that you can have the opportunity to file by Friday
3
2 o'clock-ish.
4
also not limiting it to the topics that I'm having
5
concerns about.
6
I'm not requiring you to do so.
I'm
If you think that there are other issues,
7
for example, you believe that the affidavits filed that
8
would support the Craddock test are insufficient because
9
they're conclusory and do not have the underlying data
10
or facts that is required in -- in such affidavits,
11
regardless of the fact that he's a senior claims
12
representative assigned to this particular case and
13
has -- has knowledge of the claims handling and
14
practices, then -- then let me know.
15
any other issue that you think I need to consider, by
16
all means, you know.
17
And if there is
Try and limit it to 20 pages 'cause I'd
18
like to have a good weekend.
But if not, that's fine.
19
But this is important to me.
And get me the -- just
20
show me why I don't have the power to do anything and
21
show me why I have the power to do something about this.
22
Okay?
23
MR. SHARP:
24
MR. ILLICH:
25
THE COURT:
Thank you, Your Honor.
Thank you, Your Honor.
Off the record.
LINDA VERA, CSR
DEPUTY OFFICIAL COURT REPORTER
49
1
(End of Proceedings; 4:08 p.m.)
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
LINDA VERA, CSR
DEPUTY OFFICIAL COURT REPORTER
50
1
THE STATE OF TEXAS
)
2
COUNTY OF DALLAS
)
3
4
5
6
7
8
9
10
11
12
13
I, Linda Vera, Deputy Official Court Reporter in
and for the 44th District Court of Dallas County, State
of Texas, do hereby certify that the above and foregoing
contains a true and correct transcription of all
portions of evidence and other proceedings requested in
writing by counsel for the parties to be included in
this volume of the Reporter's Record, in the
above-styled and numbered cause, all of which occurred
in open court or in chambers and were reported by me.
I FURTHER CERTIFY that this Reporter's Record of
the proceedings truly and correctly reflects the
exhibits, if any, admitted by the respective parties.
I FURTHER CERTIFY that the total cost for the
preparation of this Reporter's Record is $482.50 and was
paid by the Defendants.
WITNESS MY OFFICIAL HAND this the 21st day of
April, 2011.
14
15
16
17
18
19
20
/s/
_______________________________
Linda Vera, Texas CSR No. 8013
Deputy Official Court Reporter
Expiration Date: 12/31/11
P.O. Box 171117
Irving, Texas 75017-1117
Phone: 214.629.9879
E-mail: VeraReporting@yahoo.com
21
22
23
24
25
LINDA VERA, CSR
DEPUTY OFFICIAL COURT REPORTER
Texaco, Inc. v. Phan, 137 S.W.3d 763 (2004)
notice of a judgment for purposes of determining
timetable to appeal from judgment to determine
whether the trial court abused its discretion.
Vernon's Ann.Texas Rules Civ.Proc., Rule 306a.
137 S.W.3d 763
Court of Appeals of Texas,
Houston (1st Dist.).
TEXACO, INC., Appellant,
v.
Anh Thi PHAN, Khoa Kim Nguyen, Victor
Nguyen, and Ngoc Nguyen, Appellees.
No. 01–01–00811–CV.
2 Cases that cite this headnote
2
April 30, 2004.
Synopsis
3
4
West Headnotes (26)
Reviewing court has ability to review sufficiency
of the evidence to support a trial court's findings
concerning the date that a party received actual
Findings of Court or
Appeal and Error
Extent of Review
Appeal and Error
judgment in general
Proceedings after
Evidence
matter
Mailing, and delivery of mail
Direct testimony that a letter was properly
addressed, stamped, and mailed to the addressee
raises presumption that letter was received by the
addressee in due course, and matters of proper
addressing, stamping, and mailing may be proved
by circumstantial evidence, such as the customary
mailing routine of the sender's business.
Evelyn V. Keyes, J., filed concurring opinion.
Appeal and Error
Allowance and
perfecting of appeal or other proceeding for
review
Appeal and Error
Referee
Trial court's findings for when time to appeal from
default judgment begins to run are reviewed under
legal and factual sufficiency standards of review.
Vernon's Ann.Texas Rules Civ.Proc., Rule 306a.
Affirmed in part, reversed in part, and remanded.
1
Power of appellate court
To review a legal sufficiency challenge to the
trial court's findings, reviewing court must first
examine the record for evidence supporting
the finding, while ignoring contrary evidence,
and if there is no evidence to support the
finding, reviewing court must then examine entire
record to determine if the contrary proposition is
established as a matter of law.
Background: Owners of gas stations sued oil company
alleging company induced them to enter contracts to build and
operate two gas stations. Owners obtained default judgment.
Oil company moved for determination that time for filing
notice of appeal had not expired due to lack of notice of
default judgment. The 164th District Court, Harris County,
Martha Hill Jamison, J., determined that company received
timely notice of default judgment, which foreclosed an appeal
from default judgment. Company brought restricted appeal.
Holdings: The Court of Appeals, Tim Taft, J., held that:
1 evidence was sufficient to support finding that notice was
timely sent and received by company;
2 review of liability for default judgment was limited to
determining whether petition disclosed any invalidity of
owners' claim;
3 owners' petition sufficiently alleged necessary elements and
facts to support fraud claim;
4 evidence was legally insufficient to support lost profit
damages;
5 owners were not entitled to exemplary damages; and
6 default judgment was “final” judgment for purposes of
appeal.
Appeal and Error
in general
1 Cases that cite this headnote
5
Evidence
Rebuttal of presumptions of fact
The mere denial of receipt of a letter is sufficient
to rebut the presumption it was received in due
course.
© 2011 Thomson Reuters. No claim to original U.S. Government Works.
1
Texaco, Inc. v. Phan, 137 S.W.3d 763 (2004)
6
Evidence
trial of the case, and (4) error appears on the face
of the record.
Rebuttal of presumptions of fact
Although a denial of receipt of a letter may be
sufficient to rebut the presumption of receipt, the
denial is not conclusive and merely presents a fact
issue for the factfinder.
11
Evidence
Rebuttal of presumptions of fact
The presumption of receipt of a letter is overcome
conclusively only when evidence tending to
support contrary inference is conclusive, or so
clear, positive, and disinterested that it would be
unreasonable not to give effect to it as conclusive.
2 Cases that cite this headnote
12
Appeal and Error
Time for filing
Evidence was legally and factually sufficient to
support finding that notice of default judgment
was properly and timely mailed by district clerk
and received by defendant, and thus, defendant
failed to carry its burden of proving that it did not
receive notice of default judgment within 20 days
after it was signed, as required to extend timetable
to file notice of appeal. Vernon's Ann.Texas Rules
Civ.Proc., Rule 306a.
Pleading
Matters of fact or conclusions
A defendant's failure to answer operates as an
admission of all of the material facts alleged in
the plaintiff's petition, except for unliquidated
damages.
2 Cases that cite this headnote
8
Pleadings to Sustain Judgment
A default judgment is properly granted if (1) the
plaintiff files a petition that states a cause of
action, (2) the petition invokes the trial court's
jurisdiction, (3) the petition gives fair notice to the
defendant, and (4) the petition does not disclose
any invalidity of the claim on its face.
2 Cases that cite this headnote
7
Judgment
1 Cases that cite this headnote
13
Judgment
Construction and operation
If the facts set out in a petition allege a
cause of action, a default judgment conclusively
establishes the defendant's liability.
1 Cases that cite this headnote
6 Cases that cite this headnote
14
9
Evidence
general
Credibility of witnesses in
1 Cases that cite this headnote
Appeal and Error
appeal
Writ of error; restricted
Party filing a restricted appeal must demonstrate
the following elements: (1) appellant appealed
within six months after the judgment was
rendered, (2) the appellant was a party to the suit,
(3) the appellant did not participate in the actual
Writ of error; restricted
Review by Court of Appeals on restricted appeal
by oil company from default judgment obtained
by gas station owners was limited to determining
whether owners' petition disclosed any invalidity
of their claim that oil company fraudulently
induced them to build and operate gas stations,
and court would not review sufficiency of owners'
liability proof; oil company's failure to answer
complaint operated as admission of all material
facts in petition.
As factfinder, the trial court is given great latitude
to believe or to disbelieve a witness's testimony,
particularly if the witness is interested in the
outcome.
10
Appeal and Error
appeal
1 Cases that cite this headnote
15
Fraud
promises
Existing facts or expectations or
© 2011 Thomson Reuters. No claim to original U.S. Government Works.
2
Texaco, Inc. v. Phan, 137 S.W.3d 763 (2004)
Although a representation involves future events,
it may be fraudulent if it was made with present
knowledge of the representation's falsity.
20
Judgment
6 Cases that cite this headnote
In particular actions
Gas station owners' petition sufficiently alleged
all of necessary elements of and facts supporting
their fraud claim against oil company, as required
for default judgment after company failed to
answer petition; petition alleged company made
representations of material facts that it knew were
false or recklessly without any knowledge of the
truth of its representations.
Loss of profits and expenses
Lost profits must be based on net profits, not gross
revenues.
1 Cases that cite this headnote
16
Damages
incurred
21
Damages
incurred
Loss of profits and expenses
“Net profits,” as used in determining lost profits,
is defined as the difference between a business's
total receipts and all of the expenses incurred in
carrying on the business.
3 Cases that cite this headnote
2 Cases that cite this headnote
22
17
Damages
Loss of profits
3 Cases that cite this headnote
Damages
Loss of profits
Opinions or estimates of lost profits are
competent evidence of lost profits if based on
objective facts, figures, or data from which the
amount of lost profits can be ascertained, but it
is not necessary to produce in court documents
supporting the opinions or estimates, although
supporting documentation may affect the weight
of the evidence.
5 Cases that cite this headnote
23
Damages
incurred
Loss of profits and expenses
Damages
Loss of profits
Recovery of lost profits must be predicated on one
complete calculation, but there is more than one
correct method to calculate lost profits.
Fraud
Exemplary
Owners of gas stations who claimed oil company
fraudulently induced them to build and operate
stations were not entitled to recover actual
damages, and thus, they could not recover
exemplary damages; owners failed to present
sufficient proof of lost profits as their actual
damages. V.T.C.A., Civil Practice & Remedies
Code § 41.003.
4 Cases that cite this headnote
19
Weight and Sufficiency
Evidence of gas station owners' profit margin
was legally insufficient to support damages award
for lost profits, in action alleging oil company
fraudulently induced owners to build and operate
gas stations, even though owners used actual
profit margins for 17 months of operation in
calculating their lost profit damages; owners
failed to address whether “profit margin” used
in calculating net profits was based on static
operating expenses or whether expenses varied
depending on sales volume.
Recovery of lost profits does not require that the
loss be susceptible to exact calculation, however,
injured party must do more than show that it
suffered some lost profits, and to be recoverable,
lost profits must be proven by competent evidence
with reasonable certainty.
18
Fraud
24
Appeal and Error
controversy
Determination of part of
Default judgment against oil company on fraud
claims by gas station owners was final judgment
as required for Court of Appeals to have
© 2011 Thomson Reuters. No claim to original U.S. Government Works.
3
Texaco, Inc. v. Phan, 137 S.W.3d 763 (2004)
jurisdiction in appeal, even though judgment did
not specifically dispose of owners' claims for
attorney fees and prejudgment interest or dispose
of a defendant; judgment contained “Mother
Hubbard” clause that denied all other relief not
expressly granted in judgment.
is legally and factually sufficient to support the recovery
of lost-profit damages, and (4) whether exemplary damages
may be awarded in the absence of sufficient proof of actual
damages. We affirm the judgment in part, reverse it in part,
and remand the cause.
Factual and Procedural History
25
Judgment
Final judgment
A final judgment is one disposing of all issues and
claims, based on the record of the case.
26
Judgment
Final judgment
Finality of a judgment must be resolved by a
determination of the intention of the court as
gathered from the language of the decree and
the record as a whole, aided on occasion by the
conduct of the parties.
Attorneys and Law Firms
*766 Gregory C. Ulmer, Reagan Wm. Simpson, King &
Spalding, LLP, Houston, TX, for Appellant.
John M. O'Quinn, O'Quinn & Laminack, Tammy Tran,
Tammy Tran & Associates, Lloyd E. Kelley, Lloyd Kelly &
Associates, Pete Mai, Houston, TX, for Appellees.
Panel consists of Justices TAFT, NUCHIA, and KEYES.
Opinion
OPINION
TIM TAFT, Justice.
Appellant, Texaco, Inc. (“Texaco”), appeals a default
judgment rendered in favor of appellees, Anh Thi Phan,
Khoa Kim Nguyen, Victor Nguyen, and Ngoc Nguyen
(collectively, “the Owners”). We determine (1) whether the
evidence is legally and factually sufficient to support the
trial court's finding that Texaco received actual knowledge
of the default judgment three days after it was mailed by
the Harris County District Clerk's Office, (2) whether we
may review Texaco's legal and factual sufficiency challenges
relating to Texaco's fraud liability, (3) whether the evidence
The Owners sued Texaco for common-law fraud, fraud in
the inducement, fraud in a real estate transaction, breach
of contract, negligent misrepresentation, and conversion,
claiming that Texaco had induced them to enter into contracts
to build and to operate two Texaco stations. The Owners
served Texaco through its registered agent, Prentice Hall
Corporation System, Inc. (“Prentice Hall”). After Texaco
failed to answer, the Owners moved for a default judgment,
which motion the trial court granted on April 2, 2001. Relying
on the Owners' affidavit testimony, the trial court awarded
lost-profit damages, mental-anguish damages, and exemplary
damages. Texaco moved the trial court to determine the date
that it received notice under Texas Rule of Civil Procedure
306a, claiming that it did not receive actual notice of the
judgment until May 23, 2001. See TEX.R. CIV. P. 306a. The
trial court heard this motion and deemed the date that Texaco
received notice to be April 6, 2001, three days after notice
of default judgment against Texaco was mailed by the Harris
County District Clerk's office. Texaco timely filed notice of
its restricted appeal.
Rule 306a
1 In its fourth point of error, Texaco contends that the
evidence was legally and factually insufficient to support
the trial court's finding under rule 306a that it received
actual knowledge of the default judgment on April 6, 2001.
See TEX.R. CIV. P. 306a. Texaco claims that it presented
uncontroverted evidence that it did not receive notice of the
default judgment until May 23, 2001. 1
*767 2 To review a legal sufficiency challenge to the trial
court's findings, we must first examine the record for evidence
supporting the finding, while ignoring contrary evidence. Hot
Shot Messenger Serv., Inc. v. State, 798 S.W.2d 413, 415
(Tex.App.-Austin 1990, writ denied). If there is no evidence
to support the finding, we must then examine the entire record
to determine if the contrary proposition is established as a
matter of law. Id.
© 2011 Thomson Reuters. No claim to original U.S. Government Works.
4
Texaco, Inc. v. Phan, 137 S.W.3d 763 (2004)
3 Rule 306a provides that, if, within 20 days but no later than
90 days after a judgment is signed, a party adversely affected
by the judgment has neither received the clerk's notice nor
acquired actual knowledge of the judgment, then the time for
filing of a notice of appeal begins on the date that the party
received the clerk's notice or acquired actual knowledge of the
judgment. Id. Rule 306a places the burden on the appellant to
prove the date that it received notice and that that date was
more than 20 days after the judgment was signed. See Hot
Shot, 798 S.W.2d at 415. We review a trial court's rule 306a
findings under the legal and factual sufficiency standards of
review. See id. at 414.
the customary mailing procedures relating to the mailing of
notices allowed the presumption of receipt in due course to
arise. See Cooper, 489 S.W.2d at 415.
Texaco presented evidence rebutting this presumption by
offering the testimony of Margaret Leak, a Prentice Hall
employee, and Melinda Coultas, secretary to Michael
McQueeney, Texaco's general counsel. Leak, one of the three
employees who worked in Prentice Hall's Houston office,
where the Owners served their petition, testified that she
did not remember receiving notice of the default judgment.
Coultas testified that she, too, did not receive notice of default
judgment. Gregory Ulmer, a Baker & Hostetler attorney, also
testified that his firm represented Equiva Services, L.L.C.,
4
5
6
7 Direct testimony that a letter was properlyanother defendant in the case, and that he had inadvertently
addressed, stamped, and mailed to the addressee raised a
learned of the default judgment on May 23, 2001, when his
presumption that the letter was received by the addressee in
secretary called the district clerk's office to check on the status
2
due course. Id. at 415. The matters of proper addressing,
of the case. Ulmer claimed that he notified Texaco of the
stamping, and mailing may be proved by circumstantial
default judgment on this date and that this date was the first
evidence, such as the customary mailing routine of the
time that Texaco had received notice of the default judgment.
sender's business. Cooper v. Hall, 489 S.W.2d 409, 415
9 Here, the Owners' circumstantial evidence giving rise to
(Tex.Civ.App.-Amarillo 1972, writ ref'd n.r.e.). The mere
the
presumption of receipt was rebutted by evidence of denial
denial of receipt is sufficient to rebut the presumption. Gulf
of
receipt
by Texaco. The trial court was then presented with
Ins. Co. v. Cherry, 704 S.W.2d 459, 461 (Tex.App.-Dallas
an issue of fact to resolve. See Cooper, 489 S.W.2d at 415. As
1986, writ ref'd n.r.e.). Although a denial of receipt may
factfinder, the trial court is given great latitude to believe or
be sufficient to rebut the presumption of receipt, the denial
to disbelieve a witness's testimony, particularly if the witness
is not conclusive and merely presents a fact issue for the
is interested in the outcome. See In re Doe 4, 19 S.W.3d 322,
factfinder. Cooper, 489 S.W.2d at 415. The presumption of
325 (Tex.2000). The trial court was entitled to decide whether
receipt is overcome conclusively only when “the evidence
Texaco had presented evidence “so conclusive, or so clear,
tending to support the contrary inference is conclusive, or so
positive, and disinterested” as to overcome the presumption
clear, positive, and disinterested that it would be unreasonable
of receipt, and the court resolved this fact issue in favor of
not to give effect to it as conclusive.” Employers' *768
the Owners. See Willits, 436 S.W.2d at 921. Because we may
Nat. Life Ins. Co. of Dallas, Tex. v. Willits, 436 S.W.2d
not substitute our judgment for that of the factfinder, we hold
918, 921 (Tex.App.-Amarillo 1968, writ ref'd n.r.e.) (quoting
that the evidence is legally and factually sufficient to support
Southland Life Ins. Co. v. Greenwade, 138 Tex. 450, 159
the trial court's rule 306a finding. See Mar. Overseas Corp. v.
S.W.2d 854, 857 (1942)).
Ellis, 971 S.W.2d 402, 407 (Tex.1998) (stating that court of
8
Here, the Owners presented testimony by the appeals may not pass upon witnesses' credibility or substitute
Harris County District Clerk raising the presumption
its judgment for that of factfinder, even if evidence would
of receipt in due course of the default judgment. The
clearly support different result).
district clerk testified that she entered the information
We overrule Texaco's fourth point of error.
regarding the default judgment into the Harris County
Justice Information Management System (“JIMS”). JIMS
automatically generated a notice containing all of the defaultRestricted Appeal
judgment information. The notice was then picked up by
10 A party filing a restricted appeal must demonstrate the
Gulf Coast Presort, a mailing service vendor, which placed
following elements: (1) appellant appealed within six months
first-class postage on the notice and mailed the notice first
after the judgment was rendered, (2) the appellant was a party
class. The notice was addressed to Prentice Hall, Texaco's
to the suit, (3) the appellant did not participate in the actual
registered agent for service of process. Although there was
trial of the case, and (4) error appears on the face of the record.
no direct evidence of actual mailing, the clerk's description of
© 2011 Thomson Reuters. No claim to original U.S. Government Works.
5
Texaco, Inc. v. Phan, 137 S.W.3d 763 (2004)
See TEX.R. CIV. P. 30; Quaestor Inv., Inc. v. Chiapas, 997
S.W.2d 226, 227 (Tex.1999).
*769 Because only the fourth factor is contested, we must
determine whether error appears on the face of the record.
A. Fraud Liability
In its first point of error, Texaco contends that the evidence
is legally and factually insufficient to support a recovery for
fraud because Texaco's statements involved future events.
The Owners claim that Texaco may not contest fraud liability
on appeal from a no-answer default judgment.
*770 the plaintiffs sued certain defendants for materials and
services provided to one of the defendants. Id. at 493. Muhr,
one of the defendants for whom materials and services were
not provided, claimed that the plaintiffs' pleading disclosed
the invalidity of their claims because the invoices for services
attached to the petition did not specifically mention Muhr.
Id. at 495. The court determined that the petition alleged
an agency relationship and the fact that the invoices did not
specifically mention Muhr was not dispositive in his favor. Id.
Without considering the evidence attached to the petition, the
court held that nothing in the petition affirmatively disclosed
the invalidity of the plaintiffs' claims, and the court affirmed
the default judgment. Id.
11 A default judgment is properly granted if (1) the plaintiff
files a petition that states a cause of action, (2) the petition
invokes the trial court's jurisdiction, (3) the petition gives
fair notice to the defendant, and (4) the petition does not
disclose any invalidity of the claim on its face. Jackson v.
Biotectronics, Inc., 937 S.W.2d 38, 42 (Tex.App.-Houston
[14th Dist.] 1996, no writ).
Texaco also cites an unpublished opinion from the Dallas
Court of Appeals for the proposition that our scope of
review in determining whether the Owners were entitled
to a default judgment includes a review of both the
Owners' petition and their evidence. See Then West, Inc./
Bait House, Inc. v. Sorrells, No. 05–01–01874–CV, 2002 WL
1397477, (Tex.App.-Dallas 2002, no pet.) (not designated
12
13 A defendant's failure to answer operates as an for publication). In Then West, the defendant attacked the
admission of all of the material facts alleged in the plaintiff's
sufficiency of the plaintiff's pleadings, arguing that the
petition, except for unliquidated damages. Holt Atherton
plaintiff had alleged claims of only respondeat superior,
Indus., Inc. v. Heine, 835 S.W.2d 80, 83 (Tex.1992); Morgan
assault, and simple and gross negligence and that the plaintiff
v. Compugraphic Corp., 675 S.W.2d 729, 731 (Tex.1984).
had failed to allege any facts that would support a pleading of
If the facts set out in the petition allege a cause of action,
malicious conduct by one of the defendant's corporate agents,
a default judgment conclusively establishes the defendant's
which facts were necessary to support the plaintiff's punitiveliability. Morgan, 675 S.W.2d at 731. The Texas Supreme
damages award. Id. at 5–6. The Dallas Court of Appeals
Court has referred to the foregoing as “two long-standing
held that the plaintiff's petition was sufficient to establish
rules of Texas jurisprudence.” Id.
the plaintiff's entitlement to receive punitive damages. Id.
at 6. Although Texaco claims that Then West supports its
14 15 16 Here, Texaco asks us to review the sufficiency contention that we must review the evidence supporting
of the evidence as it relates to Texaco's liability for fraud.
the Owners' petition, the Then West court looked only at
Texaco maintains that, in a restricted appeal, it “is entitled
the plaintiff's petition for substantiation of the plaintiff's
to challenge the sufficiency of the Owners' liability proof”
allegations of malicious conduct. Id. Here, Texaco has not
and that we may review “the evidence supporting the cause of
attacked the Owners' petition for failure to state a cause of
action, not just the bare allegations in the pleadings.” Texaco
action.
argues that the Owners' evidence is insufficient to support a
recovery for fraud because the statements by Texaco involved
The argument that a defendant cannot effectively defend itself
predictions about future events, which statements Texaco
on the issue of damages without the ability to offer proof
3
of liability has also been rejected. See Fleming Mfg. Co. v.
claims are not actionable under Texas law. Texaco also
Capitol Brick, Inc., 734 S.W.2d 405, 409 (Tex.App.-Austin
claims that the Owners' evidence is insufficient because
1987, writ ref'd n.r.e.). As the Fleming court stated:
(1) it incorporated “market stud[ies]” on which the Owners
allegedly relied in signing the agreements that are the basis of
this suit and (2) these market studies contained only potential
estimates of sales, rather than fraudulent misrepresentations.
A similar argument is found in Paramount Pipe & Supply
Co. v. Muhr, 749 S.W.2d 491, 494–95 (Tex.1988). In Muhr,
To allow [the defendant] to now contest its liability
on remand would not only contravene the principles
announced in Morgan v. Compugraphic, supra, but
would also remove all legal disabilities incurred by [the
defendant] when it failed to file an answer. We cannot
© 2011 Thomson Reuters. No claim to original U.S. Government Works.
6
Texaco, Inc. v. Phan, 137 S.W.3d 763 (2004)
on one hand articulate the rule that a party admits all
factual allegations concerning liability when he fails to
answer, and then allow such a party to nonetheless contest
its liability on remand by arguing that the liability and
damages issues are inextricably intertwined.
Id. Thus, although we are allowed to review the legal and
factual sufficiency of the evidence supporting the Owners'
damages, we are not allowed to review the legal and factual
sufficiency of the evidence supporting Texaco's liability. See
Heine, 835 S.W.2d at 83; Morgan, 675 S.W.2d at 731. 4
We overrule Texaco's first point of error.
22 Texaco argues that the Owners failed to provide a
complete calculation of lost profits because they did not
present evidence of their net expected profit margin. Texaco
claims that the Owners were required either (1) to present
evidence of their actual expenses, such as employee and
management expenses, employee benefits, and depreciation,
and to deduct these expenses from their gross gasoline and
grocery sales; or (2) to present evidence that the business
expenses and overhead were static. The Owners claim that
they did present evidence of their net expected profit margin,
that this evidence was a reasonable basis for the calculation
of lost profits, and that they were not required to present
evidence of their business expenses.
*771 B. Lost Profit Damages
In its second point of error, Texaco contends that the evidence
is legally and factually insufficient to support the Owners'
recovery of lost-profit damages because these damages were
based on speculation and conjecture. Texaco argues that
the Owners' lost profits were not proven by objective facts
because (1) the Owners were starting a new enterprise with
no history of profit and (2) the Owners failed to provide
a complete calculation of lost profits because they did not
present evidence of their “net” expected profit margin.
The Owners presented affidavit testimony supporting their
claim of lost-profit damages. The Owners computed the
gasoline and grocery sales as Texaco represented these sales
would be less the actual gasoline and grocery sales during
the 17 months that they operated their Texaco stations.
The Owners then multiplied (1) the difference between the
represented and actual grocery sales by a profit margin 5 and
(2) the difference between the *772 represented and actual
gasoline sales by a profit margin per gallon of gasoline, which
margin was represented by cents per gallon of gasoline sold. 6
17 18 19 Recovery of lost profits does not require that The Owners claimed that the resulting amount represented
the loss be susceptible to exact calculation. See Heine, 835
their lost-profit damages.
S.W.2d at 84. The injured party, however, must do more than
In several cases, Texas courts have allowed evidence
show that it suffered some lost profits. Id. To be recoverable,
of expected profit margin as a reasonable basis for the
lost profits must be proven by competent evidence with
calculation of lost profits. See, e.g., White v. Southwestern
reasonable certainty. Automark of Tex. v. Disc. Trophies, 681
Bell Tel. Co., 651 S.W.2d 260, 262–63 (Tex.1983); St.
S.W.2d 828, 830 (Tex.App.-Dallas 1984, no writ). Opinions
Paul Surplus Lines Ins. Co. v. Dal–Worth Tank Co., 917
or estimates of lost profits are competent evidence of lost
S.W.2d 29, 61 (Tex.App.-Amarillo 1995), rev'd on other
profits if based on objective facts, figures, or data from
grounds, 974 S.W.2d 51 (1998); Travel Masters, Inc. v.
which the amount of lost profits can be ascertained. See
Star Tours, Inc., 830 S.W.2d 614, 620–21 (Tex.App.-Dallas
Heine, 835 S.W.2d at 84. It is not necessary to produce
1992), rev'd on other grounds, 827 S.W.2d 830 (1992);
in court documents supporting the opinions or estimates,
Worldwide Anesthesia Assocs. v. Bryan Anesthesia, Inc., 765
although supporting documentation may affect the weight of
S.W.2d 445, 450 (Tex.App.-Houston [14th Dist.] 1988, no
the evidence. Id. Recovery of lost profits must be predicated
writ); Magcobar N. Am. v. Grasso Oilfield Servs., Inc., 736
on one complete calculation, but there is more than one
S.W.2d 787, 801–02 (Tex.App.-Corpus Christi 1987, writ
correct method to calculate lost profits. Id. at 85.
dism'd by agr.); Frank B. Hall & Co. v. Beach, Inc., 733
20 21 Lost profits must be based on net profits, not gross S.W.2d 251, 258 (Tex.App.-Corpus Christi 1987, writ ref'd
revenues. See id. at 83 n. 1. “Net profits” is defined as the
n.r.e.); Keller v. Davis, 694 S.W.2d 355, 357 (Tex.App.difference between a business's total receipts and all of the
Houston [14th Dist.] 1985, writ ref'd n.r.e.).
expenses incurred in carrying on the business. Turner v. PV
In all but two of these cases, the profit was shown to be
Int'l Corp., 765 S.W.2d 455, 465 (Tex.App.-Dallas 1988),
net profit by deducting operating expenses. See White, 651
writ denied, 778 S.W.2d 865 (Tex.1989) (per curiam).
S.W.2d at 262–63; Travel Masters, Inc., 830 S.W.2d at 620–
21; Magcobar N. Am., 736 S.W.2d at 801–02; Hall, 733
© 2011 Thomson Reuters. No claim to original U.S. Government Works.
7
Texaco, Inc. v. Phan, 137 S.W.3d 763 (2004)
S.W.2d at 258; Keller, 694 S.W.2d at 357. In only two
cases does there seem to be no calculation of expenses.
See St. Paul Surplus Lines Ins. Co., 917 S.W.2d at 61
(inexplicably requiring showing of expenses deducted for
its future lost profits analysis, but not for its past lost
profits); Worldwide Anesthesia Assocs., 765 S.W.2d at 450
(allowing past lost profits to be shown by loss of income and
benefits of shareholders because plaintiff was closely held
corporation, despite jury's having been instructed that lost
profits was difference between total amount of gross receipts
and total amount of operating expenses). We follow the
mainstream authorities requiring some showing that expenses
were deducted in arriving at net profits lost. We decline to
follow those cases in which it is not clear why the court
appears to have departed from that standard.
The Owners did not specifically state in their affidavits
whether their profit margins represented gross profit margin
or net profit margin and did not show the method that they
used to calculate their stated profit margins. However, the
Owners' affidavits indicated that they calculated lost profits
by using their actual profit margin for grocery and gasoline
sales for the prior 17 months that they had operated their
stations. 7 Because the Owners had operated their stores
for a 17–month period, they could have already determined
their past profit margins on sales of gasoline and groceries.
Nevertheless, the Owners did not define what they meant by
profit margin. Nowhere did the Owners address expenses,
whether to say that expenses were static or that they rose and
fell according to volume of sales. We note that the dictionary
definition of “margin” is “the difference which exists between
net sales and the cost of merchandise sold and *773 from
which expenses are usually met or profits derived.” See
MERRIAM–WEBSTER'S COLLEGIATE DICTIONARY
759 (11th ed.2003). Because the Owners failed to meet their
burden of proving net profits, from which expenses had been
subtracted, we hold that the evidence is legally insufficient to
prove lost-profit damages.
We sustain Texaco's second point of error. 8
C. Exemplary Damages
23 In its third point of error, Texaco contends that the
evidence is legally and factually insufficient to support the
Owners' recovery of exemplary damages. Texaco argues that
(1) the Owners were not entitled to an automatic calculation of
exemplary damages under Texas Civil Practice and Remedies
Code Section 41.003, (2) there was insufficient evidence to
show that Texaco acted with sufficient culpability to support
an award of exemplary damages, and (3) the Owners did not
present proof of the authority of the person who acted on
behalf of Texaco and committed the wrongful act. See TEX.
CIV. PRAC. & REM.CODE ANN. §§ 41.003 (Vernon 2004).
It is unnecessary to address Texaco's arguments because we
have held that the Owners are not entitled to recover actual
damages; thus, they cannot recover exemplary damages. See
id. §§ 41.003(a)(1), 41.004(a).
We sustain Texaco's third point of error.
Texaco's Motions
24 Texaco has filed three motions to abate this appeal,
claiming that we do not have jurisdiction over the appeal
because the trial court's judgment is not final. Texaco argues
that the default judgment is interlocutory because it did not
(1) dispose of one of the defendants, Motiva Enterprises,
L.L.C.; 9 (2) address the Owners' prejudgment interest claim;
and (3) adjudicate damages for Texaco's breach of contract
and the Owners' request for attorney's fees.
25
26 A final judgment is one disposing of all issues
and claims, based on the record of the case. Lehmann v.
Har–Con Corp., 39 S.W.3d 191, 200 (Tex.2001); Schlipf
v. Exxon Corp., 644 S.W.2d 453, 454 (Tex.1982). Finality
“must be resolved by a determination of the intention of the
court as gathered from the language of the decree and the
record as a whole, aided on occasion by the conduct of the
parties.” Lehmann, 39 S.W.3d at 203 (quoting 5 RAY W.
MCDONALD, TEXAS CIVIL PRACTICE § 27:4[a], at 7
(John S. Covell ed., 1992)).
Here, the judgment is titled “Final Default Judgment” and
contains a Mother Hubbard clause, stating, “The Court denies
all relief not expressly granted.” The judgment was rendered
after the Owners moved for default judgment because Texaco
had failed to answer or to make an appearance in the case. The
judgment disposes of all parties and all legal claims. *774
Because the judgment did not award prejudgment interest or
attorney's fees and stated that it denied all relief not expressly
granted, the judgment implicitly denied the Owners' requests
for prejudgment interest and attorney's fees.
We find that the judgment is final and disposed of all parties
and claims. We overrule Texaco's motions to abate.
Conclusion
© 2011 Thomson Reuters. No claim to original U.S. Government Works.
8
Texaco, Inc. v. Phan, 137 S.W.3d 763 (2004)
We affirm the judgment of the trial court as to liability, and
we reverse the judgment and remand the cause for a new trial
as to damages. See Heine, 835 S.W.2d at 86 (holding that,
in case of no-answer default judgment, it is appropriate to
reverse and to remand for new trial as to damages when there
is no evidence of essential element of damages).
Justice KEYES, concurring.
EVELYN V. KEYES, Justice, concurring.
I agree with the disposition of this case. I write separately
because I believe the opinion understates appellees' burden of
proof of damages on remand. It is well settled that a default
judgment operates as an admission of all allegations set out
in the plaintiff's petition except unliquidated damages and
is, therefore, an admission of liability. Stra, Inc. v. Seafirst
Commercial Corp., 727 S.W.2d 591, 593 (Tex.App.-Houston
[1st Dist.] 1987, no writ). However, a defaulting defendant
does not admit that the event sued upon caused any of the
plaintiff's alleged injuries. Boat Superstore, Inc. v. Haner,
877 S.W.2d 376, 379 (Tex.App.-Houston [1st Dist.] 1994, no
writ). Rather, a court that renders a default judgment must
hear evidence of unliquidated damages. TEX.R. CIV. P. 243;
Holt Atherton Indus. v. Heine, 835 S.W.2d 80, 83 (Tex.1992).
At the damage assessment hearing, the plaintiff is obliged not
only to come forward with sufficient competent evidence to
establish the amount of alleged damages, but also to show a
causal nexus between the event sued upon and the resulting
injuries. Morgan v. Compugraphic Corp., 675 S.W.2d 729,
732 (Tex.1984). Proving that the event sued upon caused the
injuries claimed by the plaintiff is part and parcel of proving
the amount of damages to which the plaintiff is entitled. Id.
The causal nexus requirement is met by pleading and proof
that establishes a direct causal link between the damages
awarded, the actions of the defendant, and the injury suffered.
Haynes & Boone v. Bowser Bouldin, Ltd., 896 S.W.2d 179,
182, 183 (Tex.1995). The fact that a defendant has defaulted
—thereby admitting his liability—does not give the plaintiff
a right to recover for damages that did not arise from his cause
of action. Id.; Boat Superstore, Inc., 877 S.W.2d 376 at 379.
Here, appellees pleaded that they suffered damages for lost
profits in the amount of the difference between their expected
profits at the two sites they owned (the Katy location and the
Texas City location) as fraudulently projected in Texaco's
Gasoline Volume Forecast (GVF) and the actual profits
appellees realized at those sites. Texaco's default operated
as an admission that the projections in the GVF were false,
that Texaco knew they were false, and that Texaco intended
appellees to rely on them in making their investment decision.
See T.O. Stanley Boot Co. v. Bank of El Paso, 847 S.W.2d
218, 222 (Tex.1992) (reciting elements of fraud). Appellees
still had to prove, however, that Texaco's misrepresentations
caused them to lose profits.
The only proof of damages submitted to the trial court was
appellees' affidavits, not the GVF itself. In those affidavits,
appellees determined their lost profits by subtracting their
actual profits at the Katy *775 and Texas City locations
from the total projected sales for groceries and gasoline set
out in the GVF. Appellees averred that the GVF fraudulently
projected they would realize grocery sales of $75,000 a
month and gasoline sales of 120,516 gallons a month at
the Katy location, but they realized actual grocery sales
of only $55,000 per month and actual motor fuel sales of
60,000 gallons a month. They further averred that the GVF
fraudulently projected they would realize grocery sales of
$65,000 a month and gasoline sales of 80,134 gallons a month
at the Texas City location, but they realized actual grocery
sales of only $35,000 per month and actual motor fuel sales
of 32,000 gallons a month at that location. Since they claimed
that each store had a profit margin of 30% on grocery items
and 5¢ a gallon on gasoline, they simply applied these figures
to their actual sales to determine their actual profits. They then
subtracted their actual profits from the profits they claim they
would have made had Texaco's projected sales of gasoline
and groceries at those sites been accurate.
Lost profits are not shown where nothing in the record relates
the total amount of profits the plaintiff expects to make to
profits actually lost as a result of the defendant's wrongful
act. Szczepanik, 883 S.W.2d at 649; see also Haynes &
Boone, 896 S.W.2d at 182, 183 (holding that, in default
judgment case, shopping center landlord did not establish
causal nexus between legal malpractice and foreclosure on
shopping center where there was no evidence that tenant's
vacating premises was result of any act of attorney; attorney's
acts were not producing cause of foreclosure); Nothing
in the evidence presented by appellees at the hearing on
damages established a direct causal link between Texaco's
misrepresentations about total profits, and the lost profits
damages claimed by appellees and awarded by the trial
court. I would hold that appellees have failed to produce
any evidence of a causal relation between Texaco's sales
projections and the lower profits realized by appellees and
therefore have failed to establish a causal nexus between
© 2011 Thomson Reuters. No claim to original U.S. Government Works.
9
Texaco, Inc. v. Phan, 137 S.W.3d 763 (2004)
Texaco's misrepresentations and their own claimed lost profit
damages.
Nor do I agree with the appellees that their affidavits provide
competent evidentiary support for their claim of lost-profit
damages. To prove damages in the form of lost profits, a
plaintiff must do more than show that he suffered some
lost profits. Szczepanik v. First So. Trust Co., 883 S.W.2d
648, 649 (Tex.1994); SBC Operations, Inc. v. The Bus.
Equation, Inc., 75 S.W.3d 462, 466 (Tex.App.-San Antonio
2001, pet. denied). While recovery of lost profits does not
require that the loss be susceptible to exact calculation, the
amount of the loss must be shown by competent evidence with
reasonable certainty. Szczepanik, 883 S.W.2d at 649. This
is a fact intensive determination, requiring, at a minimum,
opinions or estimates of lost profits based on objective facts,
figures, or data from which the amount of lost profits may
be ascertained, although the documentation supporting the
opinions or estimates need not be produced in court. Id; Holt
Atherton, 835 S.W.2d at 84; SBC Operations, Inc., 75 S.W.3d
at 466. The correct measure of damages is lost net profits, not
gross profits. Holt Atherton, 835 S.W.2d at 83 n. 1.
Mere evidence that the plaintiff expected to make a profit
within a certain range at a certain time is legally insufficient
to show lost profits. Szczepanik, 883 S.W.2d at 649; see also
Holt Atherton, 835 S.W.2d at 85 (in default judgment case,
where plaintiffs did not specify which contracts were lost as
result of unavailability of bulldozer, how much profit they
would have had from those contracts, or who would have
awarded them contracts, bare assertion *776 that contracts
were lost did not demonstrate reasonably certain objective
determination of lost profits). The evidence must show to
a reasonable certainty the profits actually lost as a result of
the defendant's wrongful acts. See Szczepanik, 883 S.W.2d at
649.
While it is true that the supporting documentation for
opinions or estimates of lost profits need not be shown in
court, appellees here presented no evidence regarding the
cause for the discrepancy in either sales or profits between
those Texaco projected and those they actually realized.
Instead, they conclusorily averred that they enjoyed a 30%
profit margin on grocery items and 5¢ on gasoline, without
indicating whether those figures represented gross profits or
net profits, without showing how the figures were calculated,
and without showing how their actual profits related to
Texaco's sales projections, e.g., whether Texaco projected
profits based on its projected number of sales, or whether its
sales or profit projections were qualified in any way. Thus,
I would hold that not only did appellees fail to prove their
claimed damages for lost profits with the required specificity,
but also that their affidavits merely show that they expected
to make a profit within a certain range at a certain time and
are therefore legally insufficient to show lost profits. See id.;
Holt Atherton, 835 S.W.2d at 84.
Finally, appellees overlook the test for recovery of lost
profits by a new business set out in Texas Instruments,
Inc. v. Teletron Energy Management, Inc., 877 S.W.2d 276
(Tex.1994). It is true that an enterprise is not prohibited from
recovering lost profits merely because it is new when there are
firmer reasons to expect a profit than the mere hope of success
for an untried enterprise. Id. at 279–80. Thus, when an activity
is ongoing, but is conducted, for example, by a newly formed
subsidiary controlled and managed by the same company,
recovery for lost profits should not be denied simply because
the same activity is conducted by a subsidiary newly formed
for that purpose. Id.; see also Southwest Battery Corp. v.
Owen, 131 Tex. 423, 115 S.W.2d 1097, 1098–1099 (1938).
However, under Teletron, even where only an entity changes
and not an ongoing activity, the plaintiff must still provide
proof that the experience of the persons involved in the
enterprise, the nature of the business activity, and the relevant
market were such that the drop in profits is reasonably certain
to have been caused by the defendant's wrongful act. See
Teletron, 877 S.W.2d at 280.
Here, the activity was ongoing only in the broadest sense:
there was no ongoing activity of grocery and gasoline sales
made by appellees at the two locations at issue. Rather,
although the products being sold here were neither new nor
untested, the stations owned by appellees were newly built
and had no sales history against which to compare appellees'
actual sales. Nor is there any proof that appellees had the
requisite experience to operate service stations successfully.
And there is no evidence regarding the relevant market.
Thus, I would hold that, on this ground as well, appellees
failed to satisfy their burden that they come forward with
sufficient competent evidence to establish the amount of their
lost profits with reasonable certainty. See Holt Atherton, 835
S.W.2d at 84; Morgan, 675 S.W.2d at 732.
I would hold that appellees have neither established a
causal nexus between their alleged damages and Texaco's
projections nor provided competent evidence from which the
amount of their allegedly lost profits could be calculated with
reasonable certainty. When an appellate court finds that there
is no evidence to support an essential element of a claim for
damages after an uncontested hearing on unliquidated *777
© 2011 Thomson Reuters. No claim to original U.S. Government Works.
10
Texaco, Inc. v. Phan, 137 S.W.3d 763 (2004)
damages in a no-answer default judgment, it must remand
the cause for new trial on the issue of unliquidated damages.
Holt Atherton, 835 S.W.2d at 86. I therefore concur in the
judgment reversing and remanding this case for a new trial
on damages.
Footnotes
1
2
3
4
5
6
7
8
In a reply brief, the Owners claim that Texaco is not entitled to attack, through a restricted appeal, the sufficiency of the evidence to
support the trial court's finding that it received actual knowledge of the default judgment on April 6, 2001. The Owners argue that
Texaco may not challenge the rule 306a finding on restricted appeal because (1) the finding was made after the trial court granted the
default judgment and (2) we may not consider evidence relating to this finding because this evidence was not before the trial court
when it rendered judgment. However, Texaco timely filed its notice of restricted appeal. We have the ability to review the sufficiency
of the evidence to support a trial court's findings concerning the date that a party received actual notice of a judgment under rule
306a to determine whether the trial court abused its discretion. See Sharm, Inc. v. Martinez, 885 S.W.2d 165, 167 (Tex.App.-Corpus
Christi 1993, no writ) (holding that appellate court had jurisdiction over defendant, against whom trial court had made adverse rule
306a finding, because evidence was insufficient to support trial court's finding that defendant had failed to prove that it did not have
timely notice of default judgment and, therefore, appellate court could consider merits of defendant's appeal of default judgment);
Hot Shot Messenger Serv., Inc. v. State of Texas, 798 S.W.2d 413, 414 (Tex.App.-Austin 1990, writ denied) (determining that, in
appeal of default judgment, appellate court could review trial court's rule 306a findings for factual and legal sufficiency).
The trial court found that the notice of default judgment was received on April 6, 2001, apparently applying the three-day presumption
from rule 21a. See TEX.R. CIV. P. 21a (providing that “[w]henever a party has the right or is required to do some act within a
prescribed period after the service of a notice or other paper upon him and the notice or paper served upon by mail ..., three days
shall be added to the prescribed period.”). Although Texaco challenges the date of April 6, 2001 for lack of evidence supporting
it, we find that the facts and circumstances of this case were sufficient to raise the presumption of receipt in due course, so that the
burden remained on Texaco to overcome the presumption.
We note that Texaco does not argue in its briefs that the Owners' petition is insufficient as a matter of law for failing to plead a cause
of action. Texaco does not point to any portion of the Owners' petition that disclosed on its face invalidity of their fraud claim in
that the petition failed sufficiently to allege the facts or elements necessary to support their claims. Even if Texaco had made such
an allegation, we have reviewed the Owners' petition and find that it sufficiently alleged all of the necessary elements of and facts
supporting their fraud claim. Specifically, the Owner's petition alleged the following:
[Texaco's] representations were therefore false and the representations concerned material facts. [Texaco] made the material
representations with knowledge of their falsity or recklessly without any knowledge of the truth and as a positive assertion.
Although a representation involves future events, it may be fraudulent if it was made with present knowledge of the representation's
falsity. Bryant v. Transcon. Gas Pipe Line Corp., 821 S.W.2d 187, 190 (Tex.App.-Houston [14th Dist.] 1991, writ denied) (holding
that statement of opinion or prediction about future is actionable if made with present knowledge that statement is false or with
present intent to deceive). The Owners' allegations in their petition, which allegations are now deemed admitted by Texaco,
stated that Texaco made the representations with knowledge of their falsity. Therefore, the Owners sufficiently pleaded their
fraud claim. See id.
Texaco cites Osteen v. Osteen, 38 S.W.3d 809, 814 (Tex. App.-Houston [14th Dist.] 2001, no pet.) and Casino Magic Corp. v. King,
43 S.W.3d 14, 20 (Tex.App.-Dallas 2001, pet. denied), as further support for the proposition that liability evidence may be subjected
to a sufficiency review in a restricted appeal. However, these cases are distinguishable. Osteen is inapplicable because it involved
a default judgment of divorce. See id. (holding that, as general rule, no evidence is required to support default judgment, but that,
in context of divorce, rule is narrower because (1) respondent's failure to answer or to appear is taken as admission of allegations in
petition relating only to residence and domicile and (2) even if the respondent fails to file answer, petitioner must adduce proof to
support material allegations in petition). Casino is inapplicable because it involved an employer's appeal from a child support wage
withholding order, as opposed to an appeal from a default judgment. See id., 43 S.W.3d at 20.
Both Phan's and Victor Nguyen's affidavit testimony indicated that their expected profit margin for grocery sales was 30%.
Phan's affidavit testimony indicated that her expected profit margin for gasoline sales was five cents per gallon sold. Victor Nguyen's
affidavit testimony indicated that his expected profit margin for gasoline sales was 10 cents per gallon sold.
Phan's affidavit stated that, during these 17 months, “[t]he store had a profit margin of 30% for grocery sales and (5) cents for each
gallon of motor fuel sales.” Victor Nguyen's affidavit stated, “The store had a profit margin of 30% for grocery sales and (10) cents
for each gallon of motor fuel sales.”
Because of our disposition of Texaco's second point of error, it is unnecessary for us to address its fifth point of error complaining
of lack of notice of the hearing.
© 2011 Thomson Reuters. No claim to original U.S. Government Works.
11
Texaco, Inc. v. Phan, 137 S.W.3d 763 (2004)
9
In their original petition, the Owners named as a defendant “Starfires a/k/a Star Enterprises a/k/a Equiva Services, L.L.C. a/k/a
Motiva Enterprises, L.L.C.” The Owners then non-suited “Starfires a/k/a Star Enterprises a/k/a Equiva Services, L.L.C.” Texaco
argues that, because Motiva Enterprises, L.L.C. (“Motiva”) was not named in the Owners' motion for non-suit, it is still a party
defendant and, therefore, the default judgment is not final. However, the Owners were not required to non-suit Motiva because
Motiva was only an a/k/a (“also known as”) designation for then-defendant Starfires, Motiva was never named as a party defendant,
relief was not specifically sought against Motiva, and service was never attempted on Motiva.
End of Document
© 2011 Thomson Reuters. No claim to original U.S. Government Works.
© 2011 Thomson Reuters. No claim to original U.S. Government Works.
12
Rule 306a. Periods to Run From Signing of Judgment, TX R RCP Rule 306a
Vernon's Texas Rules Annotated
Texas Rules of Civil Procedure
Part II. Rules of Practice in District and County Courts
Section 11. Trial of Causes
H. Judgments
TX Rules of Civil Procedure, Rule 306a
Rule 306a. Periods to Run From Signing of Judgment
Currentness
1. Beginning of periods. The date of judgment or order is signed as shown of record shall determine the beginning of the
periods prescribed by these rules for the court's plenary power to grant a new trial or to vacate, modify, correct or reform a
judgment or order and for filing in the trial court the various documents that these rules authorize a party to file within such
periods including, but not limited to, motions for new trial, motions to modify judgment, motions to reinstate a case dismissed
for want of prosecution, motions to vacate judgment and requests for findings of fact and conclusions of law; but this rule shall
not determine what constitutes rendition of a judgment or order for any other purpose.
2. Date to be shown. Judges, attorneys and clerks are directed to use their best efforts to cause all judgments, decisions and
orders of any kind to be reduced to writing and signed by the trial judge with the date of signing stated therein. If the date of
signing is not recited in the judgment or order, it may be shown in the record by a certificate of the judge or otherwise; provided,
however, that the absence of a showing of the date in the record shall not invalidate any judgment or order.
3. Notice of judgment. When the final judgment or other appealable order is signed, the clerk of the court shall immediately
give notice to the parties or their attorneys of record by first-class mail advising that the judgment or order was signed. Failure
to comply with the provisions of this rule shall not affect the periods mentioned in paragraph (1) of this rule, except as provided
in paragraph (4).
4. No notice of judgment. If within twenty days after the judgment or other appealable order is signed, a party adversely
affected by it or his attorney has neither received the notice required by paragraph (3) of this rule nor acquired actual knowledge
of the order, then with respect to that party all the periods mentioned in paragraph (1) shall begin on the date that such party or
his attorney received such notice or acquired actual knowledge of the signing, whichever occurred first, but in no event shall
such periods begin more than ninety days after the original judgment or other appealable order was signed.
5. Motion, notice and hearing. In order to established the application of paragraph (4) of this rule, the party adversely affected
is required to prove in the trial court, on sworn motion and notice, the date on which the party or his attorney first either received
a notice of the judgment or acquired actual knowledge of the signing and that this date was more than twenty days after the
judgment was signed.
6. Nunc pro tunc order. When a corrected judgment has been signed after expiration of the court's plenary power pursuant to
Rule 316, the periods mentioned in paragraph (1) of this rule shall run from the date of signing the corrected judgment with
respect to any complaint that would not be applicable to the original document.
7. When process served by publication. With respect to a motion for new trial filed more than thirty days after the judgment
was signed pursuant to Rule 329 when process has been served by publication, the periods provided by paragraph (1) shall be
computed as if the judgment were signed on the date of filing the motion.
© 2011 Thomson Reuters. No claim to original U.S. Government Works.
1
Rule 306a. Periods to Run From Signing of Judgment, TX R RCP Rule 306a
Credits
June 16, 1943, eff. Dec. 31, 1943. Amended by orders of Oct. 10, 1945, eff. Feb. 1, 1946; June 10, 1980, eff. Jan. 1, 1981; Dec.
5, 1983, eff. April 1, 1984; April 10, 1986, eff. Sept. 1, 1986; July 15, 1987, eff. Jan. 1, 1988.
Editors' Notes
COMMENT--1988
2010 Electronic Update
Amended to reflect repeal of Rule 317.
COMMENTS OF ADVISORY COMMITTEE
1977 Main Volume
“The purpose of Rules 306a, 306b, 306c, and the [1946] amendments to Rules 356, 381, and 386, is to enable the
appellant to ascertain more definitely when the time to perfect an appeal begins to run.” 8 Texas B.J. 408 (1945).
Relevant Notes of Decisions (7)
View all 366
Notes of Decisions listed below contain your search terms.
Validity
Rules of Civil Procedure, Rules 306a and 165a which deprived trial court of jurisdiction to grant motion to reinstate more than
120 days after judgment was entered due to lack of prosecution, even when plaintiff did not receive notice of judgment until
after 120-day period expired, did not violate due process, where plaintiff's attorney admitted receiving copy of dismissal docket
indicating that case would be dismissed on certain date, and where plaintiff was not without remedy as plaintiff could pursue
bill of review. American General Fire and Cas. Co. v. Schattman (App. 2 Dist. 1988) 761 S.W.2d 582. Constitutional Law
3989; Judgment
153(3)
Rules of Civil Procedure, Rules 165a and 306a providing that plaintiff must challenge entry of judgment against plaintiff for
lack of prosecution within 120 days of entry of judgment, even if plaintiff did not receive notice of entry of judgment within
120-day period, did not violate Const. Art. 1, § 13. American General Fire and Cas. Co. v. Schattman (App. 2 Dist. 1988) 761
S.W.2d 582. Constitutional Law
2314; Judgment
153(3)
Notice of judgment
Subsection of rule of civil procedure, which provides that if within 20 days after judgment or other appealable order is signed,
a party adversely affected or his attorney has neither received required notice nor acquired actual knowledge of order, then all
periods specified for post-trial motions shall begin on date that such party or his attorney received notice or acquired actual
knowledge of signing, whichever occurred first, but in no event more than 90 days after signing, is not self-implementing;
unless the procedures of another subsection of rule which indicate how to establish application of rule are strictly followed, trial
court's plenary power is not restarted and court lacks authority to reinstate case more than 30 days after order of dismissal is
signed. Vernon's Ann.Texas Rules Civ.Proc., Rule 306a, subds. 4, 5. In re Wal-Mart Stores, Inc. (App. 8 Dist. 2000) 20 S.W.3d
734. Motions
10; Pretrial Procedure
698
Party against whom judgment was rendered could not avail himself of provisions extending time for perfecting appeal, Vernon's
Ann.Texas Rules Civ.Proc., Rule 306a, subd. 4, where he presented no evidence in support of allegation that he had not gained
knowledge of judgment until more than 20 days after judgment was signed. Olvera v. Olvera (App. 4 Dist. 1986) 705 S.W.2d
283, ref. n.r.e. Appeal And Error
352.1
New trial motion--In general
In determining whether appellant's cost bond and transcript were timely filed, appellate court could not look to record to
determine whether appellant in fact adduced sufficient facts at trial to justify late motion for new trial; rules 306a and 5
© 2011 Thomson Reuters. No claim to original U.S. Government Works.
2
Rule 306a. Periods to Run From Signing of Judgment, TX R RCP Rule 306a
specifically required that movant prove “in the trial court” date on which he actually received notice of judgment against him.
Corro v. Southwestern Bell Media, Inc. (App. 13 Dist. 1989) 784 S.W.2d 471. Appeal And Error
170(1)
Signing of judgment
Appellants' time for perfecting appeal ran from date they acquired actual knowledge of signing of judgment; letter mailed to
appellant's attorney enclosing proposed judgment was insufficient to comply with notice requirements of Vernon's Ann. Rules
Civ. Proc., Rule 306a, as nothing in letter indicated that judgment had as yet been signed. Western Imports Motors, Inc. v.
Mechinus (App. 4 Dist. 1987) 739 S.W.2d 125. Appeal And Error
347(1); Appeal And Error
348(2)
Forfeiture proceeding which originated in criminal case and bore a criminal trial court number remained civil in nature so that
time to perfect an appeal would have run from date of signing of the order of forfeiture, under Vernon's Ann. Rules Civ. Proc.,
rule 306a. Brown v. Barlow (App. 4 Dist. 1985) 685 S.W.2d 406. Forfeitures
5
Current with amendments received through March 15, 2011
End of Document
© 2011 Thomson Reuters. No claim to original U.S. Government Works.
© 2011 Thomson Reuters. No claim to original U.S. Government Works.
3