Williams v. Crutcher , 3 N.M. 649 ( 2013 )

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New Mexico Compilation
Commission, Santa Fe, NM
'00'04- 09:03:28 2013.04.05
IN THE COURT OF APPEALS OF THE STATE OF NEW MEXICO
Opinion Number: 2013-NMCA-044
Filing Date: February 15, 2013
Docket No. 31,128
BETH WILLIAMS a/k/a
JULIA ELIZABETH WILLIAMS,
Plaintiff-Appellant,
v.
WILLIAM CAREY CRUTCHER II,
Individually and as Executor of the
ESTATE OF JULIA MOSLEY
CRUTCHER, Deceased, and as
Trustee of the JULIA MOSLEY
CRUTCHER TESTAMENTARY
TRUST,
Defendants-Appellees.
APPEAL FROM THE DISTRICT COURT OF SAN JUAN COUNTY
William C. Birdsall, District Judge
Tully Law Firm, P.A.
Richard T. C. Tully
Farmington, NM
Thomas P. Kelly, Jr. Inc.
Thomas P. Kelly, Jr.
Santa Rosa, CA 95404
for Appellant
Gerding & O’Loughlin, P.C.
T. Ryan Lane
Farmington, NM
for Appellees
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OPINION
VIGIL, Judge.
{1} As a result of a settlement, a judgment was entered in favor of Plaintiff and against
Defendants in Texas. Plaintiff domesticated the judgment in New Mexico pursuant to the
Foreign Judgments Act (the Act), NMSA 1978, Sections 39-4A-1 to -6 (1989, as amended
through 1994), and obtained a writ of execution to satisfy the judgment from property owned
by one of the defendants. The district court granted Defendants’ motion to quash the writ
of execution on grounds that the judgment did not lie against that defendant. Plaintiff
appeals, and we reverse.
I. BACKGROUND
{2} Julia Mosley Crutcher was a widow residing in Houston, Texas. Her last will and
testament directed that after the payment of debts, expenses, taxes, and specific bequests, the
remainder of her estate be placed into a trust for the benefit of her grandchildren. To
accomplish these ends, she appointed her son, William Carey Crutcher II (Mr. Crutcher) as
independent executor of the estate (Estate) and trustee of the trust (Trust). Mrs. Crutcher
died on November 23, 1983, and in January 1984, the Probate Court of Harris County, Texas
appointed Mr. Crutcher independent executor of the Estate and trustee of the Trust. When
she died, Mrs. Crutcher had four grandchildren: Plaintiff (Beth Williams), and the three
children of Mr. Crutcher.
{3} In 2004, Plaintiff filed suit in the Harris County District Court of Texas against
Defendants, “William Carey Crutcher II, individually and as executor of the Estate of Julia
Mosley Crutcher and as trustee of the Julia Mosley Crutcher Testamentary Trust.” In
material part, Plaintiff alleged that “as executor of the Estate of Julia Mosley Crutcher,” Mr.
Crutcher “failed to distribute to Plaintiff that portion of the Julia Mosley Crutcher
Testamentary Trust to which Plaintiff was entitled to by law and by the Will of Julia Mosley
Crutcher.” Second, Plaintiff asserted that Mr. Crutcher “has used the position of trustee to
benefit himself at the expense of Plaintiff, and placed himself in a position in which [his]
self-interest conflicted with [his] obligations to protect the interests of Plaintiff in the Julia
Mosley Crutcher Testamentary Trust.” Third, Plaintiff asserted, Mr. Crutcher “has breached
his fiduciary duty of disclosure by failing to disclose to Plaintiff material facts concerning
the distribution of the proceeds from the Julia Mosley Crutcher Testamentary Trust,” which
included failing to provide an accounting or inventory of the assets of the Trust and failing
to provide Plaintiff with notice of any distributions from the Trust. Plaintiff asked in part
that she be awarded “Judgment against Defendant personally and as Trustee of Julia Mosley
Crutcher Testamentary Trust, for the amount due and owing to Plaintiff from the Julia
Mosley Crutcher Testamentary Trust according to proof.”
{4} The Texas case was set for a jury trial on February 26, 2008. On the first day of trial,
the parties settled and entered into an “Agreed Judgment” (Judgment), which was filed in
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the Harris County District Court of Texas on March 12, 2008. In pertinent part, Plaintiff was
awarded judgment in the amount of $2,040,000 against “William Carey Crutcher II,
individually, as executor of the Estate of Julia Mosley Crutcher and as Trustee of the
Testamentary Trust created by the will of Julia Mosley Crutcher.” The parties also agreed
that “upon payment to Plaintiff by cashier’s check or other banker’s funds on or before
March 27, 2008[,] in the sum of $510,000,” Plaintiff would provide “a full satisfaction of the
money judgment[,]” but if the money was not paid on or before March 27, 2008, “Plaintiff
shall be free to execute on her judgment for $2,040,000.” The Judgment provides:
This judgment is in full satisfaction for any and all claims Plaintiff has
against William Carey Crutcher II individually, as Executor of the estate of
Julia Mosley Crutcher and as Trustee of the Trust created by the will of Julia
Mosley Crutcher and exhausts any rights and/or claim Plaintiff has to inherit
from [the] Estate of Julia Mosley Crutcher.
{5} The $510,000 payment provided for in the Judgment was not paid as required, and
Plaintiff domesticated the Texas Judgment in New Mexico by filing and recording it in the
San Juan County District Court pursuant to the Act. Plaintiff thereupon filed a transcript of
judgment and obtained a writ of execution to execute on oil and gas and overriding royalty
interests owned by the Estate in New Mexico.
{6} Defendants then filed a motion to quash the writ of execution. Defendants asserted
that while Mr. Crutcher was personally liable under the $2,040,000 Texas Judgment, the
Estate and the Trust were not, and because Plaintiff was executing upon property owned by
the Estate, the writ of execution was improvidently issued and should be quashed.
Specifically, Defendants contended that because the Texas suit alleged that Mr. Crutcher
breached his fiduciary duties as both executor of the Estate and trustee of the Trust, Texas
law made him personally liable to the exclusion of the Estate and Trust. Plaintiff countered
that under Texas law, Mr. Crutcher, the Estate, and the Trust were all subject to the
Judgment because Mr. Crutcher was named as a defendant individually as well as in his
capacity as executor of the Estate and trustee of the Trust. Ultimately, the district court
agreed with Defendants, finding that “Plaintiff may not execute upon assets of an estate to
collect upon a judgment against that estate’s administrator.” Accordingly, the district court
ordered that the writ of execution “directed to royalty interests and real property” owned by
the Estate
in New Mexico “be and . . . is hereby quashed[.]” Further, the district court ordered,
“Plaintiff is prohibited from interfering with payment of royalties to the Estate of Julia
Mosley Crutcher, Deceased from oil and gas production in the State of New Mexico.”
Plaintiff appeals.
II. APPLICABLE PRINCIPLES AND STANDARD OF REVIEW
{7} The Act provides that when an authenticated copy of a judgment of a court of the
United States is filed in the clerk’s office of the district court of a county in New Mexico in
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which the debtor resides or has property that is subject to execution, foreclosure, attachment,
or garnishment, “[a] judgment so filed shall have the same effect and is subject to the same
procedures, defenses and proceedings for reopening, vacating, staying, enforcing or
satisfying as a judgment of the district court of [New Mexico] and may be enforced or
satisfied in like manner[.]” Section 39-4A-3(A). This procedure provides a speedy and
economic method for New Mexico to accord the judgments of sister states the full faith and
credit they are entitled to under the United States Constitution. Conglis v. Radcliffe, 119
N.M. 287, 288, 889 P.2d 1209, 1210 (1995); see U.S. Const. art. IV, § 1 (“Full Faith and
Credit shall be given in each State to the public Acts, Records, and judicial Proceedings of
every other State.”). Once a judgment is filed in the district court as provided in the Act, a
prima facie case for its enforcement in New Mexico is made, and the judgment debtor has
the burden of proving a defense to its enforcement. Thoma v. Thoma, 1997-NMCA-016, ¶
8, 123 N.M. 137, 934 P.2d 1066. Such defenses include “lack of personal or subject matter
jurisdiction, fraud in procuring the judgment, lack of due process, or other grounds making
the judgment invalid or unenforceable.” Id.
{8} When the judgment is domesticated pursuant to the Act, it loses its identity as the
judgment of the sister state and becomes a money judgment of the state of New Mexico.
Nat’l Bank of Ariz. v. Moore, 2005-NMCA-122, ¶ 12, 138 N.M. 496, 122 P.3d 1265 (citing
Huntington Nat’l Bank v. Sproul, 116 N.M. 254, 258, 861 P.2d 935, 939 (1993)). As such,
New Mexico law governs its enforcement. Id. Our law in this regard is well settled:
Generally, a judgment which is clear and unambiguous must be
enforced, and neither pleadings, findings nor matters outside the record may
be considered to change the meaning of the judgment. However, when the
meaning of the judgment is doubtful or ambiguous, the judgment, pleadings,
and the entire record may be resorted to for the purpose of construing the
judgment.
Lemon v. Hall, 97 N.M. 429, 431, 640 P.2d 929, 931 (1982) (citations omitted). Moreover,
while a stipulated judgment, such as the one before us in this case, is not considered to be
a judicial determination, but a contract between the parties, it is still construed in the same
way that a judgment is construed. See Owen v. Burn Constr. Co., 90 N.M. 297, 299, 563
P.2d 91, 93 (1977) (“[W]here the language of a contract is clear and unambiguous, the intent
of the parties must be ascertained from the language and terms of the agreement.” (internal
quotation marks and citations omitted)).
{9} The parties do not dispute that interpretation of the judgment before us in this case
presents us with a question of law, subject to our de novo review on appeal. We agree with
the parties. Id. at 300, 563 P.2d at 94 (stating that when the interpretation of a judgment is
determinable by inspection of the record alone, a question of law is presented); see also
Smith & Marrs, Inc. v. Osborn, 2008-NMCA-043, ¶ 10, 143 N.M. 684, 180 P.3d 1183 (“We
review a district court’s interpretation of an unambiguous contract de novo.” (internal
quotation marks and citation omitted)); Allsup’s Convenience Stores, Inc. v. N. River Ins.
4
Co., 1999-NMSC-006, ¶ 28, 127 N.M. 1, 976 P.2d 1 (stating that whether an ambiguity
exists in a contract is a question of law). Moreover, when resolution of the meaning of the
judgment turns on the interpretation of documentary evidence, as in this case, we need not
defer to the district court because we are in as good a position as the district court to interpret
the judgment. See Ca. Cas. Ins. Co. v. Garcia-Price, 2003-NMCA-044, ¶ 6, 133 N.M. 439,
63 P.3d 1159 (referring to interpretation of a contract). Finally, to the extent we are required
to interpret Texas law, our review is de novo. See Nellis v. Farmers Ins. Co. of Ariz., 2012-
NMCA-020, ¶ 21, 272 P.3d 143 (stating that the interpretation of a statute is a question of
law which is reviewed de novo by an appellate court), cert. denied, 2011-NMCERT-011,
290 P.3d 725; Miller v. Morrison, 2008-NMCA-092, ¶¶ 6-8, 144 N.M. 543, 189 P.3d 676
(interpreting Texas law relating to service of process).
III. ANALYSIS
{10} The parties dispute whether the Judgment reaches assets owned by the Estate in New
Mexico. Plaintiff argues that it does because the Estate is a named judgment debtor in the
judgment. Defendants assert that only Mr. Crutcher is personally liable under the Judgment,
even though the Estate is a named judgment debtor. Defendants argue that the “essence” of
the Texas lawsuit “was an action for damages against Mr. Crutcher for his personal
malfeasance as executor and trustee” and that under Texas law, he is personally liable for
his “malfeasance” and not the Estate. Defendants further contend that the fact that the Estate
is named as a judgment debtor does not alter this result. For the reasons which follow, we
reject Defendants’ argument.
{11} First, the Judgment is clear and unambiguous: it awards judgment in the amount of
$2,040,000 in favor of Plaintiff against “William Carey Crutcher II, individually, as executor
of the Estate of Julia Mosley Crutcher and as Trustee of the Testamentary Trust created by
the will of Julia Mosley Crutcher.” Because the language of the Judgment is clear and
unambiguous, we may not consider the pleadings, findings, nor matters outside the record
to change its meaning. Lemon, 97 N.M. at 431, 640 P.2d at 931.
{12} Second, once the Texas judgment was converted into a New Mexico judgment under
the Act, New Mexico law, not Texas law, was applicable to its enforcement. Nat’l Bank of
Ariz., 2005-NMCA-122, ¶ 12 (citing Huntington Nat’l Bank, 116 N.M. at 258, 861 P.2d at
939). Defendants have not directed us to any New Mexico authority, and we have found
none, which would hold Mr. Crutcher personally liable to the exclusion of the Estate and
Trust even though the Judgment explicitly names the Estate and Trust as judgment debtors.
On the contrary, when a judgment clearly and unambiguously states that a person or entity
is liable to a plaintiff, that person or entity is liable as stated therein. See Lemon, 97 N.M.
at 431, 640 P.2d at 931 (stating that “a judgment which is clear and unambiguous must be
enforced”); Luna v. Flores, 64 N.M. 312, 318, 328 P.2d 82, 86 (1958) (stating that where the
judgment on the second claim for relief named a defendant against whom no relief was
sought on that claim, and no findings supported inclusion of that defendant on the second
claim for relief, the case would be remanded to delete that defendant from the judgment as
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to that claim).
{13} Third, even if we were to go beyond the language of the Judgment itself, we would
still come to the same conclusion. As noted above, the Texas suit was not merely a suit for
executor “malfeasance.” In the first instance, Plaintiff sued to obtain “that portion of the
Julia Mosley Crutcher Testamentary Trust to which Plaintiff was entitled to by law and by
the Will of Julia Mosley Crutcher.” Plaintiff also asserted that as trustee, Mr. Crutcher acted
in a conflict of interest to the detriment of the Trust and breached his fiduciary duties, but
these assertions did not negate Plaintiff’s first claim. Nor did these latter claims negate the
fact that Plaintiff was seeking: “Judgment against Defendant personally and as Trustee of
Julia Mosley Crutcher Testamentary Trust, for the amount due and owing to Plaintiff from
the Julia Mosley Crutcher Testamentary Trust according to proof” as well as other relief.
The Judgment was negotiated on the first day of trial as a settlement of all claims, with all
parties represented by counsel, and no argument is made that Mr. Crutcher had no authority
to make the settlement. Further, under Texas law, the Judgment runs against the Estate.
Section 147 of the Texas Probate Code provides:
Any person having a debt or claim against the estate may enforce the
payment of the same by suit against the independent executor; and, when
judgment is recovered against the independent executor, the execution shall
run against the estate of the decedent in the hands of the independent
executor which is subject to such debt.
Tex. Probate Code Ann. § 147 (West 2013). If the parties had intended to exclude the assets
of the Estate (or the Trust) they could have expressed that intent, but they did not. To the
contrary, consistent with Plaintiff’s first claim for relief, the Judgment specifically provides
that it is in “full satisfaction” of all claims Plaintiff has against Mr. Crutcher, the Estate, and
Trust, and that it “exhausts any rights and/or claim Plaintiff has to inherit from [the] Estate
of Julia Mosley Crutcher.”
{14} Finally, we do not agree with Defendants that the Texas authorities they cite to us are
applicable. Nowhere does the Judgment recite or suggest that it is being agreed to because
Mr. Crutcher committed “malfeasance.” On the contrary, the Judgment recites that the
parties “appeared for trial and through their attorneys of record announced to the Court that
an agreement of compromise and settlement had been reached.” No judicial determination
was made that Mr. Crutcher committed “malfeasance,” and the Judgment makes no reference
to any “malfeasance” on his part. We have not been presented with cases that are applicable
in these circumstances, and do not further consider Defendants’ arguments.1
1
Defendants cite to Cross v. Old Republic Surety Co., 983 S.W.2d 771 (Tex App.
1998) and Moore v. Key, No. 05-02-00809-CV, 2003 WL 194725 (Tex. App. 2003) (mem.).
Cross addressed a surety company’s liability for a default judgment against a dependent
executor for willfully defrauding the estate and the court. 983 S.W.2d at 774. In Moore, a
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{15} For all the foregoing reasons we conclude that the Judgment lies against the Estate,
the Trust, and Mr. Crutcher personally. Accordingly, the district court erred in granting
Defendants’ motion to quash the writ of execution.
IV. CONCLUSION
{16} The district court “Order Quashing Writ of Execution” is reversed, and the case is
remanded to the district court for further proceedings consistent with this opinion.
____________________________________
MICHAEL E. VIGIL, Judge
WE CONCUR:
____________________________________
JAMES J. WECHSLER, Judge
__________________________________
CYNTHIA A. FRY, Judge
Topic Index for Williams v. Crutcher, No. 31,128
APPEAL AND ERROR
Standard of Review
CIVIL PROCEDURE
Ful Faith and Credit
CONSTITUTIONAL LAW
dependent executor was ordered to repay the estate money she unlawfully converted for her
own use. Id. at *1. These cases are clearly distinguishable. Defendants also cite to In re
Estate of Van Meter, No. 2-08-289-CV, 2009 WL 885955 (Tex. App. 2009) (mem.); In re
Estate of Hawkins, 187 S.W.3d 182 (Tex. App. 2006); Barnett v. Barnett, 985 S.W.2d 520
(Tex. App. 1998), aff’d in part, rev’d in part on other grounds by 67 S.W.3d 107 (Tex.
2001); Lawyers Sur. Corp. v. Larson, 869 S.W.2d 649 (Tex. App. 1994); and Fillion v.
Osborne, 585 S.W.2d 842 (Tex. Civ. App. 1979). All of these cases dealt with former
Section 245 of the Texas Probate Code (repealed in 2009), which in general provided that
when a personal representative was removed for cause or neglected to perform a required
duty, the personal representative and sureties were liable for the costs of removal, attorney
fees incurred in removing the personal representative or in obtaining compliance with a
statutory duty neglected by the personal representative. Defendants acknowledge that the
underlying case was not brought pursuant to Section 245 of the Texas Probate Code.
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Full Faith and Credit
JUDGMENTS
Execution of Judgment
Foreign Judgment
Settlements
Writ of Execution
JURISDICTION
Choice of Law
Personal
Subject Matter
NATURAL RESOURCES
Oil and Gas
REMEDIES
Execution
Writ of Execution
STATUTES
Interpretation
Rules of Construction
WILLS, TRUSTS AND PROBATE
Choice of Law
Claims Against Estate
Distribution
Execution
Fiduciary Duty
Trusts, General
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