No CV IN THE COURT OF APPEALS FOR THE 5TH DISTRICT OF TEXAS, AT DALLAS, TEXAS. ROSBOTTOM INTERESTS, LLC, Appellant,

Transcription

1 No CV IN THE COURT OF APPEALS FOR THE 5TH DISTRICT OF TEXAS, AT DALLAS, TEXAS ROSBOTTOM INTERESTS, LLC, Appellant, v. H.T. MOORE, LLC, Appellee Appealed from the 44th District Court of Dallas County, Texas Trial Court Case No B APPELLANT S REPLY BRIEF ORAL ARGUMENT REQUESTED Charles L. Stinneford Texas Bar No cstinneford@gordonarata.com David V. Bryce Texas Bar No dbryce@gordonarata.com Gordon, Arata, McCollam, Duplantis & Eagan, LLC 1980 Post Oak Blvd., Ste Houston, Texas Telephone: (713) Facsimile: (713) Counsel for Appellant, Rosbottom Interests, LLC ACCEPTED 225EFJ FIFTH COURT OF APPEALS DALLAS, TEXAS 11 June 30 P3:20 Lisa Matz CLERK

2 TABLE OF CONTENTS TABLE OF CONTENTS... i INDEX OF AUTHORITIES... ii ARGUMENT... 1 I. CONTRARY TO WHAT IS SUGGESTED BY HTM, NEGLIGENCE IS NOT THE STANDARD BY WHICH ROSBOTTOM INTERESTS ACTIONS ARE TO BE MEASURED II. HTM s REFERENCE TO PRO SE LITIGANTS BEING HELD TO THE SAME STANDARDS AS LICENSED ATTORNEYS IS OFF POINT III. HTM s ARGUMENTS REGARDING NOTICE ARE OFF POINT CONCLUSION AND PRAYER... 6 CERTIFICATE OF SERVICE... 8 i

3 INDEX OF AUTHORITIES Cases Carey Cruther v. Mid-Coast Diesel Services, 725 S.W.2d 500 (Tex. App. Corpus Christi 1987)... 6 Dir., State Employees Workers Comp. Div. v. Evans, 889 S.W.2d 266 (Tex.1994)... 6 Ferguson & Co. v. Roll, 776 S.W.2d 692 (Tex. App. Dallas, no writ)... 2 Fid. & Guar. Ins. Co. v. Drewery Constr. Co., 186 S.W.3d 571 (Tex. 2006)... 1, 2 Fire Ins. Co. v. Williams, 924 S.W.2d 746 (Tex. App. Texarkana 1996, no writ)... 6 Holt v. F.F. Enters., 990 S.W.2d 756 (Tex. App. Amarillo 1998, pet. denied) Levine v. Shackelford, Melton & McKinley, L.L.P., 248 S.W.3d 166 (Tex. 2008)... 1, 4, 5 Liberty Mut. Fire Ins. Co. v. Ybarra, 751 S.W.2d 615 (Tex. App. El Paso 1988, no writ)... 1 Mackey v. Bradley Motors, Inc., 871 S.W.2d 243 (Tex. App. Amarillo 1994), rev d on other grounds, 878 S.W.2d 140 (Tex. 1994)... 6 Mathis v. Lockwood, 166 S.W.3d 743 (Tex. 2005) Texas Sting, Ltd. v. R.B. Foods, Inc., 82 S.W.3d 644 (Tex. App. San Antonio 2002, pet denied) ii

4 ARGUMENT Appellant, Rosbottom Interests, LLC ( Rosbottom Interests ), files its Reply Brief for the purpose of addressing the following arguments, as presented in the Brief of Appellee, H.T. Moore, LLC ( HTM ). I. CONTRARY TO WHAT IS SUGGESTED BY HTM, NEGLIGENCE IS NOT THE STANDARD BY WHICH ROSBOTTOM INTERESTS ACTIONS ARE TO BE MEASURED. In stating the standard for conscious indifference under the Craddock test, HTM quotes language that is akin to negligence. 1 Specifically, HTM quotes the El Paso Court of Appeals as stating that [c]onscious indifference has been defined as failing to take some action which would seem indicated to a person of reasonable sensibilities under the same circumstances. 2 Negligence, however, is not the standard by which a defaulting party s actions are to be measured. 3 Indeed, the Texas Supreme Court has expressly held that a standard for conscious indifference that inquires into what a person of reasonable sensibilities would do is incorrect. 4 Rather, [t]he Craddock standard is one of intentional or conscious indifference that the defendant knew it was sued but did not care. 5 1 Resp Liberty Mut. Fire Ins. Co. v. Ybarra, 751 S.W.2d 615, 618 (Tex. App. El Paso 1988, no writ). 3 Levine v. Shackelford, Melton & McKinley, L.L.P., 248 S.W.3d 166, 168 (Tex. 2008) (holding in context Craddock test, [t]he proper standard is not a negligence standard. ). 4 Id. 5 Id. (quoting Fid. & Guar. Ins. Co. v. Drewery Constr. Co., 186 S.W.3d 571, (Tex. 2006) (per curium) (emphasis added)). 1

5 Because negligence is not the standard applicable under Craddock, the fact that a defaulted party did not act as a person of reasonable sensibilities would have acted under similar circumstances will not suffice to show conscious indifference. 6 In fact, even an admission of negligence does not show conscious indifference. 7 Therefore, HTM s assertion that Rosbottom Interests acted with conscious indifference because it did not take the steps a person of reasonable sensibilities would have taken under the circumstances fails. The uncontroverted record shows that Rosbottom Interests principal, Harold Rosbottom, who was in the midst of a personal bankruptcy, (1) met with counsel for codefendant and Rosbottom Interests affiliate, Gator Investments, LLC ( Gator ) on or about February 25, 2010, (2) understood from the meeting that the April 5, 2010 trial date would be continued pursuant to a Motion for Continuance agreed to by HTM, and (3) did not learn the trial was not in fact continued until he received notice of the entry of a default judgment sometime during the week of April 26 to April 30, The question before the Court is not how a person of reasonable sensibilities standing in Rosbottom Interests shoes would have acted under the circumstances; the question, rather, is whether it was consciously indifferent of Rosbottom Interests to not appear at trial because of its mistaken belief that the trial date was being continued. 6 Id. 7 Ferguson & Co. v. Roll, 776 S.W.2d 692, (Tex. App. Dallas, no writ) (holding that defaulting party may admit negligence and still satisfy the Craddock test). 8 CR

6 II. HTM s REFERENCE TO PRO SE LITIGANTS BEING HELD TO THE SAME STANDARDS AS LICENSED ATTORNEYS IS OFF POINT. In its brief, HTM correctly notes that a pro se litigant is held to the same standard as a licensed attorney with respect to compliance with the law and the rules of procedure. Based on this general proposition, HTM erroneously concludes that: (1) because a licensed attorney would have likely attended the hearing on the Motion for Continuance or taken steps to ascertain whether the trial date was continued; (2) Rosbottom Interests was consciously indifferent because it did not attend the hearing or make inquiries regarding its outcome. 9 In reaching such a conclusion, HTM is again improperly conflating the standards for negligence and conscious indifference. A pro se litigant is held to the same standard as a licensed attorney so that he does not gain the undue advantage that would arise if he were able to ignore the procedural standards that a licensed attorney must abide by. 10 The fact that a pro se litigant must comply with the rules of procedure, however, does not lend itself to the conclusion that a pro se litigant should be expected to act as a licensed attorney would under every circumstance. This is particularly true when considering the conscious indifference prong of the Craddock test. For if conscious indifference could be shown by merely demonstrating that a pro se litigant did not act exactly as a licensed attorney would, not only a negligence standard would be in effect, but a relaxed negligence standard. Such a 9 Resp Holt v. F.F. Enters., 990 S.W.2d 756, 759 (Tex. App. Amarillo 1998, pet. denied). 3

7 standard for assessing conscious indifference has been expressly rejected by the Texas Supreme Court. 11 If Rosbottom Interests had not timely responded to a motion for summary judgment, and then claimed it misunderstood the deadline for filing a response because it was acting pro se, it would make sense for HTM to point out that pro se litigants must comply with the rules of procedure. But in the actual case before the Court, there is no claim that Rosbottom Interests failed to comply with any particular procedural rule or law. Instead, the question is whether Rosbottom Interests acted with conscious indifference by not appearing for trial based on its understanding that the trial date was being continued. The fact that Rosbottom Interests may not have acted like a licensed attorney would have under the circumstances is thus immaterial to assessing conscious indifference. Indeed, because the Craddock test is one of equity, and the trend in the law is to avoid defaults, the Court should avoid construing the acts of Rosbottom Interests through the lens of a licensed attorney. III. HTM s ARGUMENTS REGARDING NOTICE ARE OFF POINT. In its Response, HTM appears to argue that if a party has actual or constructive notice of a trial date, failure to appear is by definition conscious indifference. 12 This is incorrect. The question here is not one of notice of the trial date. Rosbottom Interests acknowledges that at the time of its meeting with counsel for Gator, it understood that 11 Levine v. Shackelford, Melton & McKinley, L.L.P., 248 S.W.3d 166, 168 (Tex. 2008). 12 Resp

8 trial was set for April 5, The Craddock test, and particularly its conscious indifference prong, is an equitable test that does not require a showing of lack of notice. 13 Rather, even when a party has notice of a hearing or deadline to answer, it will be entitled to a new trial if it shows that its failure to appear or answer was not intentional or consciously indifferent, but instead was due to a mistake or accident. 14 The evidence in this case shows that: (1) Rosbottom Interests was aware of the April 5, 2010 trial setting; (2) Rosbottom Interests met with counsel for its affiliate and co-defendant, Gator, on or about February 25, 2010 and came to understand at the meeting that an agreed continuance was being filed and trial would not go forward on April 5, 2010; and (3) Rosbottom Interests never learned that the trial setting was not continued until after a default was entered. Notably, there is no evidence that directly controverts the fact that Rosbottom Interests did not know the trial went forward until learning of the default. HTM attempts to address this by saying it mailed four items to Rosbottom Interests between March 10, 2010 and March 31, 2010 none of these mailings, however, stated that the agreed upon Motion for Continuance was denied. Thus, although the mailings did include materials that arguably would have led a licensed attorney to make inquiries regarding the continuance, it cannot be said that Rosbottom Interests had cause or reason to doubt the understanding it obtained from Gator s counsel that the April 5 trial would be continued, 13 See Texas Sting, Ltd. v. R.B. Foods, Inc., 82 S.W.3d 644, (Tex. App. San Antonio 2002, pet denied). Under Craddock, it is the case that if a defaulted party shows that it did not receive notice, it is entitled to a new trial without need of establishing the remaining two Craddock factors. Mathis v. Lockwood, 166 S.W.3d 743, 744 (Tex. 2005). 14 See Levine, 248 S.W.3d at

9 as was agreed to by HTM. In fact, Mr. Rosbottom states in his affidavit that Rosbottom Interests did not learn that the trial was not continued until he received notice of the default judgment sometime between April 26, 2010 and April 30, Here, it bears noting that two of the principal cases relied on by HTM are distinguishable. HTM cites Mackey v. Bradley Motors, Inc. 16 for the proposition that a mistaken belief about a motion for continuance will not satisfy Craddock. In Mackey, however, the attorney of record s request for a motion for continuance was denied in his presence. 17 HTM s reliance on Carey Cruther v. Mid-Coast Diesel Services is even more misguided. 18 In that case, the finding of conscious indifference was based on an attorney s mistake of law; 19 here, there is no claim that a mistake of law caused Rosbottom Interests to not appear for trial. CONCLUSION AND PRAYER Under the Craddock test, Rosbottom Interests need not present a good excuse for why it failed to appear at trial a slight excuse will suffice. 20 Rosbottom Interests has presented a satisfactory excuse for why it did not appear at trial its justifiable belief that 15 CR S.W.2d 243 (Tex. App. Amarillo 1994), rev d on other grounds, 878 S.W.2d 140 (Tex. 1994) (per curium). 17 Id. at S.W.2d 500 (Tex. App. Corpus Christi 1987), overruled on other grounds, Dir., State Employees Workers Comp. Div. v. Evans, 889 S.W.2d 266 (Tex.1994). 19 Id. at Fire Ins. Co. v. Williams, 924 S.W.2d 746, (Tex. App. Texarkana 1996, no writ). 6

10 the trial would be continued, as had been agreed to by HTM. Perhaps, as HTM argues, Rosbottom Interests was negligent in not taking steps to confirm that the agreed upon continuance had been granted. Negligence, however, does not equate to conscious indifference. Rosbottom Interests did not consciously ignore the trial date; its actions were based on a mistaken belief. As such, the Court should reverse the trial court s denial of a new trial, reverse the judgment, and remand the cause for trial below. Respectfully submitted, /s/ Charles L. Stinneford Charles L. Stinneford Texas Bar No cstinneford@gordonarata.com David V. Bryce Texas Bar No dbryce@gordonarata.com Gordon, Arata, McCollam, Duplantis & Eagan, LLC 1980 Post Oak Blvd., Suite 1800 Houston, Texas Telephone: (713) Facsimile: (713) Counsel for Appellant, Rosbottom Interests, LLC 7

11 CERTIFICATE OF SERVICE I, the undersigned, certify that I am a member of the firm of Gordon Arata McCollam Duplantis & Eagan, LLC, attorneys for Appellant, Rosbottom Interests, LLC, and that I forwarded a true and correct copy of the foregoing to all counsel of record via Federal Express, on this 30 th day of June Mikel J. Bowers Via Federal Express No Bell Nunnally & Martin, LLP 3232 McKinney Avenue, Suite 1400 Dallas, Texas Telephone: (214) mikelb@bellnunnally.com /s/ Charles L. Stinneford Charles L. Stinneford 8