The big item on today’s otherwise quiet orders list is the Court formally accepting a case about the Texas school-finance system.
Schedule set in school finance cases
MICHAEL WILLIAMS, COMMISSIONER OF EDUCATION, IN HIS OFFICIAL CAPACITY; GLENN HEGAR, TEXAS COMPTROLLER OF PUBLIC ACCOUNTS, IN HIS OFFICIAL CAPACITY; THE TEXAS STATE BOARD OF EDUCATION; AND THE TEXAS EDUCATION AGENCY v. THE TEXAS TAXPAYER & STUDENT FAIRNESS COALITION, ET AL.; CALHOUN COUNTY ISD, ET AL.; EDGEWOOD ISD, ET AL.; FORT BEND ISD, ET AL.; TEXAS CHARTER SCHOOL ASSOCIATION, ET AL.; AND JOYCE COLEMAN, ET AL., No. 14-0776
Chosen for future argument by order issued January 23, 2015
The Court has now formally said that it will hear this "direct appeal" of the school finance ruling that held certain portions of the system unconstitutional.
The Court has agreed to the briefing schedule suggested by the parties, which puts the briefs due on April 13, 2015 (for the State and others challenging the judgment); July 2, 2015 (for those defending the judgment); and a reply on August 11, 2015 (for the State and others challenging the judgment).
That briefing schedule extends beyond the July 1, 2015 deadline set by the trial court's order. The State's motion states its belief that this deadline was suspended automatically by the appeal.
The briefing schedule also permits the Legislature to finish its session (and perhaps even a special session). Both sides will have an opportunity to address how any new legislation might affect this case.
Based on this schedule, I would expect the Court to hear oral argument in September 2015.
The briefing so far just consists of very short notices of appeal ("jurisdictional statements") filed by four groups challenging aspects of the judgment below:
the State Defendants (the commissioner of education and others)
a group led by the Texas Charter School Association
a group led by the Texas Taxpayer & Student Fairness Coalition
a group of six school districts that have broken with the main group of plaintiffs (Calhoun ISD, Abernathy ISD, Aransas ISD, Frisco ISD, Lewisville ISD, and Richardson ISD)
It was a quiet orders list this week, with no grants made or opinions issued.
With the holiday next Monday, the Court has scheduled its next private conference for this Thursday, January 22.
With its January 9, 2015 orders list, the Texas Supreme Court issued opinions in two cases.
Section 101.106 election of remedies does not foreclose a federal claim against state officials
Justice Lehrmann delivered the opinion for a unanimous court, affirming the court of appeals.
Section 101.106 of the Texas Tort Claims Act makes plaintiffs choose whether to sue the government entity or the state officials. If a plaintiff tries to have it both ways by suing both categories of defendant, “the employees shall immediately be dismissed.” Tex. Civ. Proc. & Rem. Code §101.106(e).
This petition asked the Court to clarify two situations:
Is a plaintiff barred from filing an amended petition after the State files a motion under Section 101.106(e)?
Does Section 101.106(e) also require the dismissal of claims that a plaintiff might have against state officials under federal law, such as a Section 1983 claim?
On the first, the Court held that this statute does not prevent a plaintiff from amending its petition to add a new claim. The Court distinguished its recent opinion in a health-care-liability case that a plaintiff could not dismiss its claim in an effort to avoid the penalty for not filing a timely expert report. See Op. at 10 (discussing AUSTIN STATE HOSPITAL, DR. VIKAR NUZHATH AND DR. ERIK LINDFORS v. JOEL GRAHAM, No. 10-0674 ). Here, the Court holds that the wording of the Tort Claims Act (using the word “immediately”) does not change the normal background rules of Texas procedure that would generally permit a party to amend its petition.
On the second, the Court held that Section 101.106(e) does not bar federal claims because they are not brought “under” the Tort Claims Act. See Op. at 6-7. The Court reached that result as a matter of statutory construction and so did not consider questions related to preemption or constitutionality. See Op. at 13.
A party cannot avoid an unambiguous contractual release that he chose not to read
Although this appeal led to a per curiam opinion, there is more than one holding of interest for commercial cases.
This dispute grows out of settlement negotiations in a related case. The allegation is that, when the parties were negotiating a formal written settlement agreement, one of them (Plank) promised the other (Westergren) that they would be in a partnership to develop a piece of property for which he would receive $1 million plus a share of future development profits. Westergren contends this agreement is enforceable.
The written settlement agreement, however, contained a provision described as a “RELEASE” that provided for a one-time $500,000 payment.
Westergren sued Plank and the developer of the property (NPH), claiming that he was defrauded into settling or that, at a minimum, those promises constituted an enforceable oral contract. His theory was that the release was unenforceable because of fraudulent inducement, as he had not actually read the provision but instead relied on the promises made. A jury largely agreed with him, but the trial court entered judgment notwithstanding the verdict. A divided court of appeals reversed, reinstating the verdict.
With this per curiam, the Court holds:
A contractual release is not defeated by a party choosing not to read the contract. The Court had little patience for the contention for Westergren’s explanation of why he did not read this release language, characterizing it as “because he was ‘in a hurry’ and did not have his reading glasses with him.” See Op. at 7.
A release is not a covenant not to sue. Plank argued that Westergren even bringing this suit was a breach of the settlement agreement, for which it should be entitled to damages. The Supreme Court holds that the language involved was merely a release of claims, and that the language used in this release did not imply a covenant not to sue.
The statue of frauds. The Court also addressed whether the alleged oral agreement was enforceable at all. The statute of frauds would normally bar an oral agreement regarding real estate. Westergren contended that an exception applied here for partial performance because Plank paid $500,000. Westergren’s theory is that this represented the first half of performance under the alleged oral contract and, thus, was partial performance.
The Court disagreed that Westergren’s framing of this issue accurately stated the law about “partial performance” — explaining in footnote 2 that more would be required but that it would reserve that issue for a proper case. See Op. 9n.2. This case does not shed much light on what law does apply in that situation.
The Court did not need to provide more clarity because, even accepting Westergren’s framing, the record was still legally insufficient here. The Court held that this $500,000 payment was not “’unequivocally referable’ to the agreement.” See Op. 9. Here, NPH’s payment of $500,000 could easily be explained as referable to the settlement agreement, not the alleged partnership agreement. The Court thus held that Westergren’s statute-of-frauds theory failed even his own suggested test.
The Court had a two-day private conference before this weekly orders list, leading to orders in more than four dozen petitions. Four cases were ultimately chosen for oral argument in January. The remaining petitioners and relators were not so lucky. The Court has posted the list at a new location.
These are the cases chosen for oral argument with this orders list:
Compounding pharmacies under the health-care-liability act
This is a claim against a compounding pharmacy based on an antioxidant supplement. The supplement was provided to a doctor's office, which then provided it to patients. The pharmacy argued that this was a health-care-liability claim and, accordingly, should be dismissed because no expert report was timely filed. The plaintiff argues that filling what the response calls a "bulk" order for these supplements is not filling a prescription and does not fit the statute.
Proof needed to raise a fact question on immunity
This is a suit against a government unit by the family of two girls who were killed by riptides near the Texas City Dike. There were signs posted elsewhere, but not where the accident took place. The City won a plea to the jurisdiction. The petition argues that there was a fact question on immunity, in part because the presence of warning signs at other nearby locations signaled awareness of the problem — or at least would permit a fact-finder to draw such an inference.
Disqualification of counsel
The Court granted rehearing of its previous denial of this mandamus petition. The petition concerns disqualification of counsel for having hired a former employee of the other side's litigation team. The issues include how harm to the litigants should be weighed in this analysis and whether lesser alternatives to disqualification should have been explored.
Local government immunity from contract claims
The question is whether suit can be brought against the City for a contract alleged to have been entered in its proprietary (rather than governmental) capacity. The LCRA argues that this category of contract is not covered by immunity and that, if there were any doubt, it has also been waived by statute. The City argues that this proprietary-governmental distinction is inapplicable to contract claims and has also become unworkable in practice.
It was a quiet orders list today, with no opinions or grants. The Court heard oral arguments this week, and there was no internal conference at which more fully developed petitions might have been considered.
The Court’s calendar shows a two-day private conference next Tuesday and Wednesday.
With its orders list this week, the Texas Supreme Court did not grant review in any new cases or issue any opinions.
The Court traveled to Texas Tech University on Thursday to hear oral arguments in two cases:
* * *
The courtroom facility at Texas Tech is very modern and wired for video cameras, and the arguments are now available on the State Bar’s oral argument page. The camera perspective is a little different — more of a jury’s-eye view of the room, which makes sense for a teaching courtroom.
See also: “Texas Supreme Court justices hear seatbelt evidence, sports injury cases at Tech law”
With this week’s orders list, the Texas Supreme Court issued one new opinion, revised one of its opinions from June, and chose six new cases for argument this fall.
The court of appeals can look beyond a recital in the judgment when evaluating a restricted appeal
A party who does not participate in the trial court hearing that leads to the judgment being challenged can file a notice of restricted appeal for up to six months after judgment, as compared to the normal 30-day notice of appeal deadline. The wrinkle here is that the judgment recited that the party had appeared at the key hearing — while other aspects of the trial court record indicated that she had not.
The underlying dispute involves child custody. About two years after a divorce, the father moved to modify the court's custody order to appoint him sole managing conservator. A hearing was set for September 2011, and while the father appeared by telephone, the mother did not. The trial court did not enter an order until November 2011. That order, in turn, began with recitals stating that the hearing occurred in November 2011 and that the mother appeared.
The Supreme Court held that the court of appeals was not bound by the recital on the face of the judgment and, instead, should have considered the other indications in the record that — here, at least — conclusively established that the relevant hearing was the one that took place in September 2011.
The Court emphasized that this record was truly overwhelming:
Importantly, nothing in the record indicates the hearing took place in November 2011. And at least eight references in the record, including portions of the trial court’s docket sheet and the reporter’s record, conclusively confirm the hearing occurred in September 2011 and the petitioner did not participate.
When the record is less conclusive, a party may have a much more difficult time trying to challenge an incorrect recital in a judgment that threatens to deprive the appellate courts of jurisdiction.
Slight revision to the Ford v. Castillo opinion
The Court revised its opinion in FORD MOTOR COMPANY v. EZEQUIEL CASTILLO, INDIVIDUALLY, MARIA DE LOS ANGELES CASTILLO..., No. 13-0158
, the fraud case growing out of a note sent by a juror asking about the amount of damages, inducing a quick settlement. (See previous post.)
The new opinion addresses at least two issues noted in the rehearing motion. First, it rejected the argument that Ford’s reliance on the note was unreasonable because juries can send notes about damages without having yet resolved the merits. The original opinion had not addressed this argument. On rehearing, the Court explained that, given the context here and the text of the note itself, the evidence was legally sufficient on this element.
Second, the Court remanded on the issue of factual sufficiency. The court of appeals had not reached that issue, and the court’s original opinion did not address it. On rehearing, the petition urged that the Court remand to the court of appeals so that it could consider the factual sufficiency challenge.
To accomplish that, the Court granted rehearing, issued this new opinion replacing its previous one, and remanded to the court of appeals.
This orders list includes six grants and twenty denials of review for petitions that had been fully briefed on the merits.
These are the six grants:
Expert testimony about causation
This petition challenges a jury verdict that certain chemicals caused a fire within a facility storing many other chemicals, on the basis that (1) the expert's opinions were not supported by a sufficient foundation and (2) the evidence was legally insufficient.
Among the issues identified in the petition:
that it "credits expert testimony that damages are 'consistent with' a particular
causation theory rather than requiring probative evidence of causation"
that it includes "proof of causation by process of elimination"
that they expert testimony was admitted without "requiring each part of the causation theory to be supported by testing or other scientifically reliable evidence"
that it "[d]isregards undisputed test results conducted by a defendant’s experts that
disprove a plaintiff’s theory"
Whether a misrepresentation in a babysitting flyer is a "substantial cause" of an eventual sexual abuse
The family of a child who was abused by a babysitter brought this claim against the babysitter's mother, who had made a misleading flyer about his trustworthiness as a babysitter, and the church that distributed that flyer. The allegation is that he was "troubled" with known psychiatric issues and that on the second babysitting session, he sexually abused two young boys. The jury found the defendants liable.
The court of appeals reversed and rendered, concluding that the evidence of causation presented here was legally insufficient based on Doe v. Boys Club of Dallas, also a sexual abuse case. In Boys Club, the Court held that the chain of causation had been essentially broken by other links between the abuser and the victim's family, such that the original lies were no longer a "substantial factor" causing the injury.
The petition asks the Court to hold that Boys Club was not meant to be a blanket protection for those whose misrepresentations might be linked to sexual abuse. The respondents argue that the sexual abuse was not the "natural and probable" result of the misrepresentation because the conduct was so extraordinary that it broke the chain of causation.
When does post-judgment interest start to accrue?
In a quite long-running case, the dispute here is how to determine the start date for post-judgment interest when the original judgment goes up on appeal and is partially changed on remand.
The petition contends that the interest should be computed beginning in 2012. It argues that the original 1998 judgment was not itself final — that it was an interlocutory order not itself appealed to the court of appeals. It also argues that the substantive nature of the remand (involving the introduction of new evidence, some by the plaintiff) warranted treating the 2012 award as the starting point for computing interest.
The Texas Supreme Court issued a quiet orders list today, with no opinions or new cases chosen for oral argument.
The Court’s next internal conference is scheduled to begin September 30, and its next oral arguments will be on October 9 (to be held at Texas Tech University).