Untitled Texas Attorney General Opinion ( 1985 )

The Attormy General of Texas
December 30, 1985
JIM MATTOX
Attorney General
Supreme Court Building Honorable Frank Tf:jeda Opinion No. JM-409
P. 0. Box 12546 Chairman
Aus!,“, TX. 76711. 2546 Comittee on Judic:i,alAffairs Re: Whether court costs and
512,4752501
Texas House of Relmresentatives attorney fees may be excluded
Telex 910/674-1367
TelecoDier 51214750266
P. 0. Box 2910 in detemining the "amount in
Austin, Texas 78769 controversy" in justice and
county courts
714 Jackson. Suite 700
Dallas. TX. 752024606
Dear Repre8entatiT.eTejeda:
2141742.6944
The statutes which establish the arnountin controversy for juris-
4624 Alberta Ave., Suite 160 dictional purposer in civil cases in county courts and justice courts,
El Paso, TX. 79905.2793 articles 1949 and 2385, V.T.C.S., respectively, presently fix a
9151533.3464
minimum and maximumsdollar amount in controversy and specify that the
amount shall be nexclusive of interest." You ask whether the Texas
1001 Texas, Suite 700 Constitution permj.tsthe legislature to amend articles 1949 and 2385
Houston, TX. 77002-3111 to exclude court costs and attorney fees from the determination of the
71 W223.5886 amount in controversy.
County court:3which are created by the Texas Constitution and
606 Broadway, Suite 312
Lubbock, TX. 79401-3479
justice courts hare a jurisdictional amount in controversy which is
606/747.5236 set by articles 1949 and 2385 in accord with the Texas Constitution.
ZTex. Const. art. V, 516 (county courts); 819 (justice courts). In
contrast, the jur,isdictional amount in controversy for statutory
4309 N. Tenth, Suite 8
McAllen, TX. 76501-1665
county courts depa?ndsupon the language of the statutes which create
5121662.4547 the particular &urts. See Amigo- Rilicopters, Inc. v. Jones, 488
S.W.2d 473 (Tex. Civ. Apt- Houston 114th Dist.] 1972, no writ).
Both section 16 and section 19 of article V specify certain minimum
200 Main Plaza, Suite 4M)
and maximum jurisdictional amounts that shall be determined "exclusive
San Antonio, TX. 70205-2797
51212254191
of interest." As indicated, articles 1949 and 2385 expressly echo
this language. Ycu ask whether these articles may be amended to read
"exclusive of interest, costs, and attorney fees."
An Equal OppOrtUnitYI
Affirmative Action Employer As presently interpreted pursuant to these provisions, the juris-
dictional amount i,n controversy in both types of courts does not
include costs. Ccsts have traditionally been deemed to be no part of
the amount in con:roversy in litigation and have not been considered
in determining the jurisdiction of the courts. National Life and
Accident Insurance Co. v. Ralfin, 99 S.W.2d 997 (Tex. Civ. App. -.San
Antonio 1936, *o-writ). For these reasons, the legislature may
clearly codify existing law with regard to court costs by amending
articles 1949 and 2385 to specify that court costs shall not be
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Honorable Frank Tejeda - Pzig;e
2 ,(JM-409)
considered in computing thf!amOunt in controversy. See V.T.C.S. art. 1
(legislature may codify or c:hangecommon law). -
The term "costs" does not ordinarily include attorney fees; there
is 'no common-law right to 'recoverattorney fees from an opponent in
litigation as a part of c:osts. See Johnson v. Universal Life and
Accident Insurance Co?, 94 S.W.2dT145 (Tex. 1936); see also New
Amsterdam Casualty Cc--
z. l:exasIndustries, Inc., 414 S.W.2d 914 iTZ
1967); Bakery Equipment ard.Service Co. v. Aztec Equipment Co., 582
S.W.2d 870 (Tex. Civ. App. - San Antonio 1979, no writ); Norman v.
Safway Products, Inc., 404 S.W.2d 69 (Tex. Civ. App. - Dallas 1966, no
writ). Attorney fees may be recovered only when a valid basis exists
for claiming attorney feelr either by statute or contract. -- See New
Amsterdam Casualty Co. v. Texas Industries, Inc., supra. There is a
divergence among the stat;, as to whether attorney fees which are
recoverable as a matter of l.aware to be used in computing the amount
in controversy absent a statute which makes such fees expressly
excluded from the jurisdict,ionalamount. See Annot., 167 A.L.R. 1243,
1247 (1947). It is well settled in Texasthat when attorney fees are
provided for by statute or contract, a demand for attorney fees in a
petition constitutes a par<: of the amOunt in controversy in civil
cases in both county and justice courts, and is considered in deter-
mining such amount for jrn:isdictionalpurposes. Long v. Fox, 625
S.W.2d 376. 378 (Tex. Civ. Aoo.
.. - San Antonio 1981. writ ref'd n.r.e.)
(county court); seeNationsi Life and Accident Insurance Co. v. Moore,
104 S.W.2d 897 (Tex. Civ. App. - Austin 1937, no writ) (statutory
attorney fees in justice cc'urt);Jones v. McKinney, 224 S.W. 720 (Tex.
Civ. App. - Dallas 1920, no writ) (contractual attorney fees in
justice court).
The courts in Texas have traditionally treated attorney fees as
different in nature from c:asts. Contractual attorney fees have been
considered a part of the amount in controversy as an element of
damages. Similarly, statutzaswhich provide for attorney fees create a
new cause of action or a ner part of a cause of action. A long line
of cases has held that attorney fees constitute a part of the amount
in controversy despite ritatutory provisions which indicate that
attorney fees shall be taxe.das costs, but these cases do not state
that the legislature may 'v,t constitutionally exclude attorney fees
from the jurisdictional z:.ount. See, e.g., United States Finance
V. Quinn, 149 S.W.2d !.48(Tex. Civ. App. - Galveston 1941. writ
civ F East Texas zitle Co. v. Par&&, 116 S.W.2d 497.(Tex.
. - Texarkana 1938. writ dism'd w.o.i.1: Washinaton National
Insurance Co. v. Guadalupa& Funeral Home, 109~-~'
S:W.2d 1002 (Tex. Civ.
APP. - Beaumont 1937, no wFt);. Maryland Casualty Co., 105
S.W.2d 376 (Tex. Civ. App. .-Beaumont 1937, no writ); National Life h
Accident Insurance Co. v. 'Moore, 104 S.W.2d 897 (Tex. Cf.v. .APP. -
Austin 1937, no writ); NzItional Life & Accident Insurance Co; v.
Halfin, 99 S.W.2d 997 (Tz: - Civ. App.
Callaway v. Gulf States L:.f'eInsurance Agency, 51 S.W.2d 1070 (Tex.
Civ. App. - El Paso 1932, no writ); see also Provident Insurance Co.
p. 1872
,
Honorable Frank Tejeda - Page 3 (JM-409)
v. Browning. 157 S.W.2d 971 (Tex. Civ. App. - Eastland 1941, no writ);
Reid v. Ramsey, 143 S.W.2ii793 (Tex. Civ. App. - Waco 1940, no writ);
Eanes v. Haynes, 135 S.W.2d 190 (Tex. Civ. App. - Eastland 1939, no
writ); M&night v. Washinglou National Insurance Co., 131 S.W.2d 1072
(Tex. Civ. App. - Dallrts 1939, no writ). This line of cases
originated from the Commission of Appeals decision in Johnson v.
Universal Life and Accide;: Insurance Co., w The Johnson case
suggests that this rule is .theresult of statutory constmction:
the [statute] doe!3not change the right to recover
attorney's fees, but only says that they shall be
taxed as part of ,thecosts.
. . . .
The amended act does not say that in ascer-
taining the anount in controversy, for jurisdic-
tional purposes, the attorney’s fees shall not be
considered. (Emphasis in original).
94 S.W.2d at 1146; see illso Johnson v. Universal Life h Accident
Insurance Co., 96 S.Wmfc676 (Tex. Civ. App. - Eastland 1933, no
writ). The various statutes which uresentlv authorize recoverv of
attorney fees in specified cases do not expressly require that they be
computed as part of the amount in controversy. Nevertheless, none of
these cases required the courts to address directly the constitutional
issue raised by your requelst.
The only language in ~;ections16 and 19 of article V of the Texas
Constitution which addreszr the manner in which the amount in con-
troversy is to be detemined states that it shall be determined
"exclusive of interest"; the provision does not expressly require that
attorney fees be included in the amount in controversy. No other
provisions of the Texas Constitution address the manner in which the
amount in controversy is to be computed. As indicated, however, at
the time the constitutional provision was initially drafted, costs
were never computed as .?art of the amount in controversy while
attorney fees were computed as part of the amount. There existed no
need to expressly address the inclusion or exclusion of these items in
the amount or value in controversy. Although the express exclusion of
interest from the computation need not be interpreted as en implied
prohibition on a legislative exclusion of costs and statutory attorney
fees from the computation of the amount in controversy, the meaning of
the "amount in controvemy" which was in effect at the tine the
provision was adopted sh,>uld control. The amount in controversy
excluded costs but included attorney fees.
At least one case in Texas has indicated that the rule is one
that originates with the t,onstitutionitself. See De Busk v. Quest,
290 S.W.2d 569, 571 (Tex. Civ. App. - Amarill~956, writ dism'd).
The court in De Busk v. Cu.est
L- held that attorney fees constitute a
p. 1873
Eonorabla Frank Tejeda - Pqle 4 (Ji+409)
1
part of the amount in conl:roversyIn civil suits in county courts as
established by article V, mction 16 of the Texas Constitution. Id.
The case also suggests that the amount in controversy established for
civil suits in justice ccurts by article V, section 19 includes
attorney fees. This is consistent with the treatment of attorney fees
as different in nature from costs.
Moreover, the jurisdiction of a court over the person, over the
res, and over the subject 'matter in controversy are not affected by
the amount in controversy. The amount In controversy is usually the
controlling factor in determining jurisdiction among the various
courts. The proposed amerkments could be viewed as expanding, as a
practical matter, the jurf,sdictionalamount of the county courts and
justice courts. Accordinfly, constitutional limits on the legisla-
ture's power to change ~thf:jurisdiction in county courts and justice
courts are instructive.
Article V, section 1 of the Texas Constitution specifies the
courts that are to exercise the state's judicial power. These courts
include constitutional county courts and justice courts. The last
paragraph of section 1 states:
The Legislature may establish such other courts
as it may deem necessary and prescribe the juris-
diction and orga1:lratlonthereof, and may conform
the jurisdiction of the district and other in-
ferior courts the?&. (Emphasis added).
Section 1 authorizes the legislature to create additional courts and
to "conform the jurisdiction of the district and other inferior courts
thereto"; the provision does,not authorisa the legislature to withdraw
jurisdiction which is granted constitutionally to a court. Lord v.
Clayton, 352 S.W.Zd 718 Tex. 1961); Reasonover v. Reasonover, 58
S.W.2d 817 (Tex. 1933). Pha Texas Constitution contains provisions
which specifically authorize certain changes in the jurisdiction of
county courts and justice c.c'urts.
Artfclc V, section 16 fixes the minimum and maximum amount in
controversy for various types of suits in county court. Article V,
section 22 provides:
The Legislatu!:eshall have power, by local or
ganeral law, to &crease, diminish or change the
civil and crimin;? jurisdiction of Couaty Courts;
and in cases of any such change of jurisdiction,
the Legislature shall also conform the juris-
diction of the other courts to such change.
(Emphasis added).
Section 22 has been const:nledliberally by the courts to allow the
legislature to change the jurisdiction of the county courts. -See
p. 1874
E
Honorable Frank Tejeda - Pa,ge5 (x-l-409)
Gulf, W.T. & P. Railway Co.-". Fromma, 84 S.W. 1054, 1056 (Tex. 1905);
Stavely v. Stavely, 94 S.W.2d 545, 546 (Tex. Civ. App. - Eastland
1936, writ dism'd w.0.j.); see also King v. State, 255 S.W.2d 879
(Tax. Grim. App. 1953) (withdrawal of criminal jurisdiction); Rogers
v. Graves, 221 S.W.2d 399 (Tex. Civ. App. - Waco 1949, writ ref'd)
(withdrawal of civil jurisdiction); cf. State v. Gillette's Estate, 10
S.W.2d 984 (Tax. 1928) (sc:ction22does not authorize withdrawal of
probate jurisdiction from the county court; for changes in probate
jurisdiction, see art. V, 58). However, the cases do not hold that
the legislaturemay change the jurisdictional amount which is fixed by
the constitution. If the Legislature could change the jurisdictional
amount in constitutional county courts and justice courts there would
be little need for such an amount to be set in the constitution.
In one case, Campsey 'T, Brumley, 55 S.W.2d 810 (Tex. 1932), 'the
Commission of Appeals statled in dicta that article V. section 22
authorized the legislature to enact a statute which conferred original
jurisdiction on a particular county court in civil cases, where the
amount in controversy was less than the minimum amount fixed in the
constitution. The court dLd not address the constitutional issue of
whether this statute amount,edto the legal equivalent of changing the
jurisdictional amount which is fixed by the Texas Constitution.
Nevertheless, regardless of whether the exclusion of attorney fees
from the computation of the amount In controversy is the equivalent of
changing the constitutionally fixed amount in controversy, we conclude
that the term "amount in :ontroversy" encompasses attorney fees but
not costs.
Article V, section 19 provides for civil jurisdiction in justice
courts as follows:
Justices of the peace shall have . . . exclu-
sive jurisdiction in civil matters of all cases
where the amount in controversy is two hundred
dollars or less, exclusive of interest, unless
exclusive original jurisdiction is given to the
District or Coun:y Courts, and concurrent juris-
diction with the County Courts when the matter in
controversy excec:ds two hundred dollars and does
not exceed five hundred dollars, exclusive of
interest, unless exclusive jurisdiction is given
to the County Courts, and, as provided by law,
when the matter' in controversy exceeds five
hundred dollars, concurrent jurisdiction with both
the County Court,3 and the District Courts in an
amount not to excisedone thousand dollars exclu-
sive of interest, unless exclusive jurisdiction is
given to the County Courts or the District Courts;
and such other jurisdiction, criminal and civil,
as may be providtz:by law, under such regulations
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Honorable Frank Tejeda - Page 6 (JM-409)
as may be pre+ibed by law. . . . (Emphasis
added).
Subject to certain limits, section 19 authorizes the legislature to
give justice courts addit:lonaljurisdiction. Nevertheless, the con-
stitutional ConstNction cf the term "amount in controversy" applied
to article V, section 16 should also be applied to this section. See
De Busk v. Quest, 290 S.W.:!dat 571. Accordingly, the Taxas ConstiG
tion prohibits the legislt.turefrom amending article 2385 to exclude
attorney fees from the ccmputation of the amount in controversy in
civil cases In justice cou~:ts.
SUMMARY
The legislatcre may amand articles 1949 and
2385, V.T.C.S., t:o exclude court costs from the
computation of the amount in controversy in county
courts and just:lce courts, respectively, without
violating the Texa,sConstitution. Because attorney
fees differ in nitt:ure
from court costs, the legis-
lature may not ccnstitutionally enact amendments to
exclude attorney :iees from the computation of the
amount in controversy without corollary constitu-
tional amendments.
gz-
MATTOX
Attorney General of Texas
JACK HIGHTOWER
First Assistant Attorney Gelera
MARY KELLER
Executive Assistant Attornqy General
ROBERT GRAY
Special Assistant Attorney General
RICK GILPIN
Chairman, Opinion Committee
Prepared by Jennifer Riggs
Assistant Attorney.General
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