David Reyes and Sonia Valenzuela v. Annette Burrus , 2013 Tex. App. LEXIS 12011 ( 2013 )

COURT OF APPEALS
EIGHTH DISTRICT OF TEXAS
EL PASO, TEXAS
DAVID REYES AND SONIA §
VALENZUELA,
§ No. 08-12-00200-CV
Appellants,
§ Appeal from the
v.
§ 346th Judicial District Court
ANNETTE BURRUS AND TORNILLO
DTP VI, LLC d/b/a GBT REALTY § of El Paso County, Texas
CORPORATION,
§ (TC#2012-DCV03532)
Appellees.
§
OPINION
This is an accelerated interlocutory appeal from a trial court’s order enjoining David Reyes
and Sonia Valenzuela from receiving settlement funds from their attorney’s trust account. See
TEX.CIV.PRAC.&REM.CODE ANN. 51.014(a)(4)(West Supp. 2012)(allowing appeal from
interlocutory order of district court granting or refusing a temporary injunction or granting or
overruling a motion to dissolve temporary injunction). In two issues, Reyes and Valenzuela1
contend that the trial court erred in issuing the injunction because: (1) Annette Burrus failed to
show a probable right of recovery on her suit against them; and (2) the temporary injunction
affected funds unrelated to the subject matter of Burrus’s suit. Concluding that Appellants are
1
For the sake of convenience and simplicity, we will refer to Reyes and Valenzuela, who are married, as Appellants
throughout this opinion.
correct, we reverse the trial court’s order, dissolve the temporary injunction, and remand the case
for further proceedings consistent with this opinion.
FACTUAL AND PROCEDURAL BACKGROUND
This case involves the alleged tortious interference with a contract to sell real property. In
June 2011, Annette Burrus agreed to sell two acres of her property to Tornillo DTP VI, LLC d/b/a
GBT Realty Corporation for development. Burrus informed Appellants, who had been living in a
mobile home on the property since 1994, that they would have to vacate the property after it was
sold. Burrus sold the property to Tornillo in February 2012.
Appellants did not vacate the premises and, instead, sued Burrus and Tornillo. Appellants
sought a declaratory judgment that they owned the mobile home and land upon which it sat by
virtue of adverse possession and asserted causes of action for trespass to real property, breach of
contract, violations of an executory contract, and statutory fraud. Burrus answered, denying that
Appellants owned the mobile home and land. Burrus also filed a counter-claim against
Appellants, alleging that they had tortiously interfered with her existing contract with Tornillo by
filing their lawsuit.
In conjunction with her counter-claim, Burrus sought to temporarily enjoin Tornillo from
making any settlement payments to Appellants, who had agreed to vacate the premises and
relinquish title and possession in exchange for Tornillo’s payment of $64,000 to them. Following
a telephonic hearing, the trial court granted a temporary restraining order, but permitted the partial
disbursement of $10,000 to Appellants for relocating expenses. A few days later, the trial court
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held an evidentiary hearing on the temporary injunction. By then, Appellants had vacated the
premises and were awaiting the disbursement of the remainder of the settlement.
At the hearing, Burrus argued that a temporary injunction was necessary to ensure that she
could collect a potential judgment against Appellants because they were paupers and hence
judgment proof. The trial court was swayed, ordering that the remainder of the settlement be
deposited into the trust account of Appellants’ attorney and enjoining her from disbursing the
funds to them.
TEMPORARY INJUNCTION
As was mentioned above, Appellants have raised two issues challenging the trial court’s
order. 2 We begin our discussion with the second issue, however, as its resolution disposes of this
appeal. In their second issue, Appellants argue that the trial court abused its discretion in granting
the temporary injunction because Burrus impermissible enjoined assets unrelated to the subject
matter of her suit against them as a means of satisfying a potential money judgment. We agree.
Standard of Review
2
Appellants also argue that as a matter of law, they cannot be liable for tortious interference because they were
exercising their own legal rights or, in the alternative, pursuing a colorable legal right in good faith and were therefore
justified in interfering with Burrus’s contract. See Marrs and Smith Partnership v. D.K. Boyd Oil and Gas Co., Inc.,
223 S.W.3d 1, 19 (Tex.App.--El Paso 2005, pet. denied)(noting that even if the plaintiff establishes the defendant
tortiously interfered, the defendant may still prevail by establishing his justification in doing so “based on either the
exercise of [his] own legal rights, or a good faith claim to a colorable legal right, even though that claim ultimately
proves to be mistaken.”). However, Appellants first raise this argument in their reply brief. The Rules of Appellate
Procedure do not permit an appellant to raise an issue in a reply brief that was not included in his original brief.
TEX.R.APP.P. 38.3; Fox v. City of El Paso, 292 S.W.3d 247, 249 (Tex.App.--El Paso 2009, pet. denied). An issue
raised for the first time in a reply brief is waived and need not be considered by an appeals court. Fox, 292 S.W.3d at
249; Few v. Few, 271 S.W.3d 341, 347 (Tex.App.--El Paso 2008, pet. denied); Gray v. Woodville Health Care Center,
225 S.W.3d 613, 620 (Tex.App.--El Paso 2006, pet. denied). Accordingly, Appellants have failed to preserve this
argument for review.
3
The decision to grant or deny a temporary injunction lies within the trial court’s sound
discretion. Butnaru v. Ford Motor Co., 84 S.W.3d 198, 204 (Tex. 2002). A trial court abuses its
discretion when it acts unreasonably or in an arbitrary manner, without reference to guiding rules
or principles. Id. at 211. For example, a trial court abuses its discretion if it misapplies the law to
established facts. See id. In addition, a trial court abuses its discretion if it grants an injunction
in the face of an adequate remedy at law. Harris County v. Gordon, 616 S.W.2d 167, 168, 170
(Tex. 1981).
Applicable Law
The purpose of a temporary injunction “is to preserve the status quo of the litigation’s
subject matter pending a trial on the merits.” Butnaru, 84 S.W.3d at 204. To be entitled to a
temporary injunction, the applicant must prove: (1) a probable right to recovery; and (2) a
probable injury. State v. Southwestern Bell Tel. Co., 526 S.W.2d 526, 528 (Tex.
1975)(superseded by statute on other grounds). To establish a probable right to recovery, the
applicant must establish she has a cause of action for which she may be granted relief. See
Walling v. Metcalfe, 863 S.W.2d 56, 57-58 (Tex. 1993). To prove a probable injury, the applicant
must establish imminent harm, irreparable injury, and no adequate remedy at law for damages.
Bankler v. Vale, 75 S.W.3d 29, 39 (Tex.App.--San Antonio 2001, no pet.).
Generally, an adequate remedy at law exists and injunctive relief is improper where any
potential harm may be “adequately cured by monetary damages.” Ballenger v. Ballenger, 694
S.W.2d 72, 77 (Tex.App.--Corpus Christi 1985, no writ). A corollary to this general rule is the
principle that a temporary injunction cannot be used to secure the legal remedy of damages by
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freezing assets unrelated to the subject matter of the suit. See, e.g., Nowak v. Los Patios Investors,
Ltd., 898 S.W.2d 9, 11 (Tex.App.--San Antonio 1995, no writ); Harper v. Powell, 821 S.W.2d
456, 457 (Tex.App.--Corpus Christi 1992, no writ); Lane v. Baker, 601 S.W.2d 143, 145
(Tex.Civ.App.--Austin 1980, no writ); Frederick Leyland & Co. v. Webster Bros. & Co., 283 S.W.
332, 335 (Tex.Civ.App.--Dallas 1926), writ dism’d w.o.j., 115 Tex. 511, 283 S.W. 1071 (1926)(all
reversing temporary injunctions freezing assets unrelated to the subject matter of the suit).
Discussion
Contrary to Burrus’s assertion, the temporary injunction in this case impermissibly froze
assets unrelated to the subject matter of Burrus’s suit against Appellants. As pled by Burrus, the
subject matter of her tortious-interference cause of action was the recovery of money damages
related to the loss of the benefits of her contract with Tornillo caused by Appellants’ refusal to
vacate the premises and institution of suit3—not the recovery of funds obtained by Appellants
from a settlement with Tornillo.
Burrus argues that the settlement funds are related to the subject matter of her suit against
Appellants. In so arguing, Burrus asserts the subject matter of her suit “deals with Tornillo’s
purchase of the subject property . . . that two Judges found . . . [Appellants] did not have the
ownership interest to sell . . . and the funds that were paid to both [her] and [A]ppellant[s].”
3
Although Appellants’ refusal to vacate the premises was not pled by Burrus as a basis for relief, the record reveals it
was tried by consent at the hearing. Evidence was developed on the issue, both Appellants and Burrus argued about
its legal significance, and, more importantly, Appellants never once complained that this was not an issue to be tried.
See Phillips v. Phillips, 296 S.W.3d 656, 670 (Tex.App.--El Paso 2009, pet. denied)(whether issue was tried by
consent requires examination of the record for evidence of trial of the issue); Hartford Fire Ins. Co. v. C. Springs 300,
Ltd., 287 S.W.3d 771, 780 (Tex.App.--Houston [1st Dist.] 2009, pet. denied)(unpled issue may be deemed tried by
consent when evidence on the issue is developed under circumstances indicating that both parties understood the issue
was in the case, and the other party failed to make an appropriate complaint).
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However, nowhere in her petition does Burrus suggest that the basis of her counter-claim against
Appellants for tortious interference was Tornillo’s purchase of the subject property and the
proceeds from that purchase. Indeed, Burrus testified at the temporary injunction hearing that she
received payment in full from Tornillo. Nor does Burrus direct our attention to any judgment in
the record, and we have found none, adjudicating the merits of Appellants’ claims against Burrus
and Tornillo. Burrus’s reliance on the trial court’s orders temporarily restraining and ultimately
enjoining Appellants fails to prove that Appellants did not have an ownership interest in the
subject property because “the ultimate merits of the case are not before the trial court” in a
temporary injunction hearing. Reach Group, L.L.C. v. Angelina Group, 173 S.W.3d 834, 837
(Tex.App.--Houston [14th Dist.] 2005, no pet.). Burrus has thus failed to establish that the
settlement funds are related to the subject matter of her suit against Appellants.
In reality, Burrus sought to freeze assets unrelated to the subject matter of her suit against
Appellants as a means of satisfying a potential judgment. In some specific circumstances, it is
permissible to freeze these type of assets when the defendant is insolvent or likely to be insolvent
at the time a judgment is rendered. See e.g., Deckert v. Indep. Shares Corp., 311 U.S. 282, 289,
61 S. Ct. 229, 233-34, 85 L. Ed. 189 (1940)(party seeking injunction to preserve assets or their
proceeds that are subject to a pled equitable remedy such as rescission, constructive trust, or
restitution); Butnaru, 84 S.W.3d at 211 (party seeking injunction to enjoin assets that form basis of
underlying suit, i.e., right to the asset is basis of suit); Khaledi v. H.K. Global Trading, Ltd., 126
S.W.3d 273, 278-79 (Tex.App.--San Antonio 2003, no pet.)(party seeking injunction has security
interest in asset sought to be enjoined); Nowak, 898 S.W.2d at 11, citing Teradyne, Inc. v. Mostek
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Corp., 797 F.2d 43, 45 (1st Cir. 1986)(party seeking injunction to enjoin assets specifically set
aside for purpose of satisfying potential judgment in underlying suit). Burrus did not raise this
argument on appeal as a basis for upholding the trial court’s ruling. Accordingly, we do not
address the propriety of affirming the trial court’s order on this basis.
In sum, Burrus failed to establish that she has no adequate remedy at law to secure potential
money damages in her cause of action against Appellants and, consequently, that she was entitled
to enjoin assets unrelated to the subject matter of her suit against them. Given Burrus’s failure to
do so, the trial court abused its discretion in granting injunctive relief. We therefore sustain
Appellant’s second issue.
CONCLUSION
We reverse the trial court’s order, dissolve the temporary injunction, and remand the case
back to the trial court for further proceedings consistent with this opinion.
September 25, 2013
YVONNE T. RODRIGUEZ, Justice
Before McClure, C.J., Rivera, and Rodriguez, JJ.
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