Unifund CCR Partners v. Eddie Watson ( 2011 )

NO. 07-10-00273-CV
IN THE COURT OF APPEALS
FOR THE SEVENTH DISTRICT OF TEXAS
AT AMARILLO
PANEL D
APRIL 8, 2011
UNIFUND CCR PARTNERS, APPELLANT
v.
EDDIE WATSON, APPELLEE
FROM THE COUNTY COURT AT LAW NO. 2 OF TARRANT COUNTY;
NO. 2010-079503-2; HONORABLE SIDNEY C. FARRAR, JR., JUDGE
Before QUINN, C.J., and CAMPBELL and PIRTLE, JJ.
OPINION
Appellant Unifund CCR Partners appeals the trial court’s order sustaining the
plea to the jurisdiction of appellee Eddie Watson and dismissing the case. We will
reverse and remand the case to the trial court for further proceedings.
Background
Unifund sued Watson. According to its live petition, Unifund was the assignee of
a credit card account on which Watson defaulted. On May 3, 2010, Watson filed a plea
to the jurisdiction alleging “[w]ithout some admissible evidence of the assignment,
[Unifund] lacks standing to bring its claims.” Watson filed no evidence supporting his
plea.
The clerk’s record contains the response of Unifund with attached evidence. The
response, under a cover letter from Unifund’s attorney dated May 12, was received by
the county clerk on May 14, 2010. On the same day, the trial court signed an order
dismissing the case for want of jurisdiction. In part, the order states “[a]fter hearing
arguments of counsel and reviewing the documents filed in this cause, the Court finds
that [Watson’s] Plea should be GRANTED.” Unifund did not file a motion for new trial
but timely perfected this appeal.
Analysis
Through a single issue, Unifund argues the trial court erred in granting Watson’s
plea to the jurisdiction and dismissing the case.1 In support of its issue, Unifund argues
in part that the trial court should have handled Watson’s plea to the jurisdiction like a
motion for summary judgment. As we read the parties’ briefs, their chief dispute on
appeal is whether Unifund presented a response with sufficient supporting evidence in
opposition to Watson’s plea to the jurisdiction. But because Unifund is correct that the
procedure on a challenge of evidence supporting jurisdictional facts is like that for a
traditional motion for summary judgment, Texas Dep’t of Parks & Wildlife v. Miranda,
133 S.W.3d 217, 228 (Tex. 2004), our concern on review is not the timeliness or
1
See Malooly Bros, Inc. v. Napier, 461 S.W.2d 119, 121 (Tex. 1970), where the
court concluded that a point of error stating generally that the trial court erred by
granting summary judgment authorizes review of all possible grounds of trial court error
in granting the summary judgment.
2
sufficiency of Unifund’s evidence. Or, for that matter, whether it even filed a response.
Rather, the question is whether Watson carried the burden that was his.
The basis of Watson’s plea to the jurisdiction was Unifund lacked evidence to
prove ownership of Watson’s account, and thus could not show standing to assert its
claims. Standing is a prerequisite to the trial court’s subject-matter jurisdiction. Bland
Indep. Sch. Dist. v. Blue, 34 S.W.3d 547, 553-54 (Tex. 2000). The issue of standing
focuses on whether a party possesses a “justiciable interest” in the outcome of a suit.
Austin Nursing Center, Inc. v. Lovato, 171 S.W.3d 845, 848 (Tex. 2005). Thus a real
controversy between the parties that will actually be determined by the adjudication
sought must exist. Id. (quoting Tex. Ass’n of Bus. v. Tex. Air Control Bd., 852 S.W.2d
440, 443-44 (Tex. 1993)). One who has a personal stake in the controversy has
standing. Robinson v. Neeley, 192 S.W.3d 904, 907 (Tex.App.--Dallas 2006, no pet.).
A party’s standing may be challenged by a plea to the jurisdiction as well as by other
procedural vehicles. Bland, 34 S.W.3d at 554.
A plea to the jurisdiction is a dilatory plea that seeks dismissal of a case for lack
of subject-matter jurisdiction. Harris County v. Sykes, 136 S.W.3d 635, 638 (Tex.
2004). Whether the trial court lacks subject-matter jurisdiction is a question of law we
review de novo. State v. Holland, 221 S.W.3d 639, 642 (Tex. 2007).
A plaintiff is obligated to plead facts affirmatively demonstrating the subject-
matter jurisdiction of the trial court. Miranda, 133 S.W.3d at 226; see Texas Ass’n of
Business, 852 S.W.2d at 446 (discussing standing). “It has long been the rule that a
plaintiff’s good faith allegations are used to determine the trial court’s jurisdiction.” Frost
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Nat’l Bank v. Fernandez, 315 S.W.3d 494, 502-503 (Tex. 2010). Whether a plaintiff’s
pleadings affirmatively demonstrate subject-matter jurisdiction also is a question of law.
Miranda, 133 S.W.3d at 226. We liberally construe the plaintiff’s petition, looking to the
pleader’s intent. Holland, 221 S.W.3d at 642-43; City of Austin v. Leggett, 257 S.W.3d
456, 461 (Tex. App.--Austin 2008, no pet.). A plaintiff should plead facts supporting
jurisdiction although specific allegations about subject-matter jurisdiction are not
required. Tex. Dep’t of Transportation v. Beckner, 74 S.W.3d 98, 103-04, 104 n.10
(Tex.App.--Waco 2002, no pet.) (citing Tex. Ass’n of Business, 852 S.W.2d at 446 and
Tex. R. Civ. P. 47, 78-82). To determine standing, a court may presume the truth of
allegations supporting standing. Fernandez, 315 S.W.3d at 503.
“When a plea to the jurisdiction challenges the existence of facts alleged by the
pleader to establish the trial court’s subject-matter jurisdiction, the trial court must
consider relevant evidence submitted by the parties.” Miranda, 133 S.W.3d at 227
(citing Bland, 34 S.W.3d at 555). This standard generally mirrors that of a traditional
summary judgment. Id. at 228; Tex. R. Civ. P. 166a(c). Thus, the trial court may
consider affidavits and other summary judgment-type evidence. FKM P’ship v. Board of
Regents of Univ. of Houston Sys., 255 S.W.3d 619, 628 (Tex. 2008). The court takes
as true evidence favorable to the nonmovant and indulges every reasonable inference
and resolves any doubts in the nonmovant’s favor. City of Waco v. Kirwan, 298 S.W.3d
618, 622 (Tex. 2009).
It is for the defendant to assert the absence of subject-matter jurisdiction and
present conclusive proof that the trial court lacks subject-matter jurisdiction. Miranda,
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133 S.W.3d at 228 (party asserting plea to jurisdiction must meet summary judgment
standard of proof); City of Austin v. Rangel, 184 S.W.3d 377, 382 (Tex.App.--Austin
2006, no pet.) (defendant must first establish as a matter of law absence of subject-
matter jurisdiction); Dallas County v. Wadley, 168 S.W.3d 373, 377, 378-79 (Tex.App.--
Dallas 2005, pet. denied) (plaintiffs had no burden on defendant’s plea to jurisdiction
until defendant met its burden). If the defendant discharges this burden, the plaintiff
must present evidence sufficient to raise a material issue of fact regarding jurisdiction or
the plea will be sustained. Miranda, 133 S.W.3d at 228; City of Dallas v. Heard, 252
S.W.3d 98, 102 (Tex.App.--Dallas 2008, pet. denied). However, as with a traditional
motion for summary judgment, if the defendant fails to present conclusive proof of facts
negating subject-matter jurisdiction, the burden does not shift to the plaintiff to establish
the existence of an issue of material fact. See Wadley, 168 S.W.3d at 378-79. This
means that a defendant may not merely offer a pleading denying the existence of
jurisdictional facts and by so doing force the plaintiff to present evidence sufficient to
raise an issue of fact. Rangel, 184 S.W.3d at 382; cf. Tex. R. Civ. P. 166a(i) (no-
evidence motion for summary judgment).2 The plaintiff is thus protected from having to
put on its case simply to establish jurisdiction. See Miranda, 133 S.W.3d at 228;
Wadley, 168 S.W.3d at 377.
2
Watson contends on appeal that Unifund failed to preserve error because it did
not file a motion for new trial. The contention is based on the notion Unifund bore a
burden to demonstrate its standing in response to Watson’s plea to the jurisdiction.
Because Unifund had no such burden, it is irrelevant whether the trial court considered
its response received by the trial court clerk on the day of the hearing.
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Here, in its live petition Unifund alleged: “In the usual course of business, First
USA Bank NA, advanced funds to [Watson] pursuant to credit card
#4266841040550913. [Unifund] is the assignee of this credit card agreement.” While,
as Watson points out, a document evidencing the assignment was not attached to the
pleading, there is no such requirement. See Tex. R. Civ. P. 59. “Texas follows a ‘fair
notice’ standard for pleading, which looks to whether the opposing party can ascertain
from the pleading the nature and basic issues of the controversy and what testimony will
be relevant.” Horizon/CMS Healthcare Corp. v. Auld, 34 S.W.3d 887, 896 (Tex. 2000).
Unifund’s pleading alleging its status as assignee of Watson’s credit card account
sufficiently plead its standing. See Fernandez, 315 S.W.3d at 503-04 (allegation in bill
of review petition of will construction case that party was decedent’s “non-marital child
and, because of that relationship, she is entitled to an intestate inheritance . . .”
sufficient to confer standing regardless of truth of alleged relationship or rebuttal of
claim on merits).
Nevertheless, in his plea to the jurisdiction, Watson asserted the “underlying
jurisdictional facts” were in issue. He argued Unifund lacked any evidence of
assignment and was obligated to come forward with evidence sufficient to demonstrate
an issue of fact. As noted, Watson offered no evidence supporting his plea. Nor did he
argue or otherwise direct the trial court to evidence conclusively negating the claimed
assignment of Unifund.3 By failing to make conclusive proof that Unifund did not occupy
3
Watson notes on appeal that no reporter’s record was made of the May 14
hearing on his plea to the jurisdiction. In the absence of a reporter’s record, he argues,
we must presume evidence sufficient to support the trial court’s judgment was
presented. Case law supports a general proposition that when a reporter’s record is not
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the claimed status of assignee of Watson’s account, Watson did not carry his
evidentiary burden. The burden of presenting evidence sufficient to raise a material
issue of fact never shifted to Unifund. Miranda, 133 S.W.3d at 228; Wadley, 168
S.W.3d at 379. Unifund sufficiently plead its standing and Watson offered no evidence
supporting his challenge of jurisdictional facts. The trial court erred in sustaining
Watson’s plea to the jurisdiction.
Conclusion
We sustain Unifund’s issue, and remand the case to the trial court for further
proceedings consistent with this opinion.
James T. Campbell
Justice
brought forward a reviewing court must presume the evidence before the trial court was
adequate to support the judgment or order. Parker v. Coppedge, No. 07-05-0389-CV,
2006 Tex. App. Lexis 2373, at *2 n.2 (Tex.App.--Amarillo March 29, 2006, pet. denied)
(per curiam, mem. op.). And live testimony sometimes is presented at a hearing on a
plea to the jurisdiction. See, e.g., Bland, 34 S.W.3d at 550; Pickett v. Texas Mut. Ins.
Co., 239 S.W.3d 826, 839-40 (Tex.App.—Austin 2007, no pet.). But Watson does not
tell us that evidence was presented at the May 14 hearing, and nothing in the record
suggests the court heard evidence. As noted, the court’s judgment indicates it was not
based on evidence heard at the hearing, stating “after hearing arguments of counsel
and reviewing the documents filed in this case, the Court finds that the Defendant’s Plea
should be GRANTED.” Watson effectively asks us to presume both that the court heard
evidence, and that it conclusively established Unifund lacked standing. Under the
circumstances reflected in this record, we will not do so.
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