John P. Alphonso v. Bishop John Douglas Deshotel and the Roman Catholic Diocese of Dallas , 2013 Tex. App. LEXIS 14193 ( 2013 )

COURT OF APPEALS
EIGHTH DISTRICT OF TEXAS
EL PASO, TEXAS
JOHN P. ALPHONSO, §
No. 08-12-00210-CV
Appellant, §
Appeal from the
v. §
134th Judicial District Court
BISHOP JOHN DOUGLAS DESHOTEL §
AND THE ROMAN CATHOLIC of Dallas County, Texas
DIOCESE OF DALLAS, §
(TC# DC-12-01240-G)
Appellees. §
OPINION
In this defamation case, John P. Alphonso appeals the trial court’s order dismissing his
claims against Appellees, Bishop John Douglas Deshotel and the Roman Catholic Diocese of
Dallas, pursuant to the Texas Citizen Participation Act (“Act”). In three issues, Alphonso
challenges the constitutionality of the Act and contends that the trial court erred in dismissing his
lawsuit and in awarding attorney’s fees and costs to Appellees pursuant to the Act. We affirm, in
part, and reverse and remand, in part.
FACTUAL AND PROCEDURAL BACKGROUND
Alphonso is an ordained priest who was previously employed by the Roman Catholic
Diocese of Dallas. While Alphonso was serving as the administrator of St. Jude Chapel (“St.
Jude”), the Diocese received information that he was diverting donations intended for St. Jude to
financial accounts in his name, those of his nephew and niece, and that of a charitable organization
created by him—the Diocese of Ahmedabad, Inc. (“DOA”). St. Jude sued Alphonso, his nephew
and niece, and the DOA for conversion and successfully obtained a temporary restraining order
prohibiting them from accessing the financial accounts in dispute.
The parties eventually settled.1 Pursuant to the settlement agreement: (1) the parties
agreed to release and discharge each other from all claims arising from or related to the suit; (2)
Alphonso agreed to pay St. Jude $300,000 and shut down the DOA; and (3) St. Jude agreed to
dismiss the lawsuit. A miscellaneous provision in the settlement agreement provided that:
Neither this Agreement, nor any negotiations in connection herewith, shall
be construed or deemed to be used as evidence or an admission on the part of the
Parties hereto of any liability or wrongdoing for any of the Released Claims, and
this Agreement shall not be offered or received into evidence as any such admission
with respect to the Released Claims.
Approximately two months after the settlement agreement was signed, Bishop Deshotel
read the following statement to the parishioners of St. Jude:
We are pleased to inform you that a settlement agreement has been reached with
Father John Alphonso. He has made restitution for funds that were
misappropriated during the time he served at St. Jude Chapel. Three hundred
thousand dollars have been wired to the Chapel account by Father Alphonso to
reimburse the St. Jude donations as well as to cover a portion of the legal fees
incurred.
Pursuant to the settlement agreement, Father Alphonso has also dissolved the
Diocese of Ahmedabad, Inc. and transferred the proceeds of the corporation to
India. We are grateful that this dispute has been resolved.
We appreciate your patience and your continued generosity to and support of St.
Jude Chapel.
Alphonso subsequently sued Appellees for defamation, intentional infliction of emotional distress,
and breach of contract. After answering, Appellees moved jointly to dismiss Alphonso’s claims
pursuant to the Act and to recover their attorney’s fees and costs.
1
Alphonso’s niece was not a party to the settlement agreement.
2
The trial court heard Appellees’ motion to dismiss and took it under advisement. Ten
days later, the trial court—without explaining its reasons for doing so—granted the motion,
dismissed Alphonso’s lawsuit, and awarded Appellees $56,472.90 in attorney’s fees and costs.
Alphonso subsequently moved for reconsideration and for a new trial, but both motions were
denied.
DISMISSAL UNDER THE TEXAS CITIZENS PARTICIPATION ACT
In his first issue, Alphonso contends that the trial court erred in dismissing his defamation
claim pursuant to the Act because he established, by clear and specific evidence, a prima facie case
as to each essential element of his claim.2 We disagree.
Applicable Law
The Texas Legislature enacted the Act “to encourage and safeguard the constitutional
rights of persons to petition, speak freely, associate freely, and otherwise participate in
government to the maximum extent permitted by law and, at the same time, protect the rights of a
person to file meritorious lawsuits for demonstrable injury.” TEX.CIV.PRAC.&REM.CODE ANN. §
27.002 (West Supp. 2013). To achieve these ends, the Legislature provided that if a legal action
is brought in response to a party’s exercise of the right of free speech, the right to petition, or the
right of association, that person may move to dismiss the action. Id. at § 27.003(a). The movant
bears the initial burden to show by a preponderance of the evidence that the action “is based on,
relates to, or is in response to the party’s exercise” of any of the aforementioned constitutional
rights. Id. at § 27.005(b)(1). If the movant satisfies this burden, then the trial court must dismiss
the legal action unless the party who brought the action “establishes by clear and specific evidence
2
Alphonso does not challenge the trial court’s dismissal of his causes of action for breach of contract and intentional
infliction of emotional distress.
3
a prima facie case for each essential element of the claim in question.”
TEX.CIV.PRAC.&REM.CODE ANN. § 27.005(c).
The Act does not define the phrases “clear and specific evidence” and “prima facie case.”
Those terms have been defined by case law, however. “Clear and specific evidence” is defined as
“evidence unaided by presumptions, inferences, or intendments.” McDonald v. Clemens, 464
S.W.2d 450, 456 (Tex.Civ.App.--Tyler 1971, no writ); see also S. Cantu & Son v. Ramirez, 101
S.W.2d 820, 822 (Tex.Civ.App.--San Antonio 1936, no writ). “Prima facie evidence” is defined
as “evidence that, until its effect is overcome by other evidence, will suffice as proof of a fact in
issue.” Duncan v. Butterowe, Inc., 474 S.W.2d 619, 621 (Tex.Civ.App.--Houston [14th Dist.]
1971, no writ). “In other words, a prima facie case is one that will entitle a party to recover if no
evidence to the contrary is offered by the opposite party.” Id., citing Simonds v. Stanolind Oil &
Gas Co., 134 Tex. 332, 136 S.W.2d 207, 209 (1940).
Standard of Review
We employ a de novo standard in reviewing a trial court’s order dismissing a legal action
under the Act. Rehak Creative Servs., Inc. v. Witt, 404 S.W.3d 716, 726 (Tex.App.--Houston
[14th Dist.] 2013, pet. denied). We review de novo whether: (1) the movant satisfied the initial
burden imposed by Section 27.005(b); and (2) the non-movant satisfied the shifted, heightened
burden imposed by Section 27.005(c). Id. But here, we need not concern ourselves with
determining whether Appellees satisfied Section 27.005(b)’s initial burden because Alphonso
does not argue that his defamation claim is not based on, related to, or in response to Appellees’
exercise of their rights of free speech, of association, and to petition. Accordingly, our inquiry is
limited to determining “de novo whether the record contains a minimum quantum of clear and
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specific evidence that, unaided by inferences, would establish each essential element of the claim
in question if no contrary evidence is offered.” Rehak Creative Servs., Inc., 404 S.W.3d at 727.
Discussion
Alphonso has failed to meet his burden to establish by clear and specific evidence a prima
facie case for each essential element of his defamation claim against Appellees.3
To recover for defamation, a public official must prove: (1) the defendant published a
false statement; (2) which was defamatory to the public official; and (3) the false statement was
made with actual malice concerning the truth of the statement.4 Huckabee v. Time Warner Entm’t
Co., L.P., 19 S.W.3d 413, 420 (Tex. 2000); WFAA-TV, Inc. v. McLemore, 978 S.W.2d 568, 571
(Tex. 1998). Alphonso contends that the statement to the parishioners of St. Jude that he
misappropriated funds was false because he testified in his affidavit “that he did not
misappropriate the funds in question.” But Alphonso never testified in his affidavit that he did
not misappropriate funds. Rather, Alphonso testified that the “Statements declar[ing] that I
‘misappropriated’ St. Jude Chapel’s funds . . . were false and defamatory on their face because the
written Release and Settlement Agreement specifically stated that there was no admission of any
liability or wrongdoing.” In light of several factors, we conclude that Alphonso’s testimony is not
enough to demonstrate by clear and specific evidence a prima facie case that Bishop Deshotel’s
statement is, in fact, false.
First, “[a] detailed defamatory statement should be readily discreditable.” Marc A.
3
A substantial portion of Alphonso’s argument in his brief and at oral argument was devoted to arguing that the trial
court was prohibited from considering controverting evidence in determining whether he satisfied his burden under
Section 27.005(b). Given our conclusion that Alphonso did not establish a prima facie case based on the evidence he
submitted, we need not address this argument.
4
Alphonso does not argue that he is not a public figure for purposes of his defamation claim.
5
Franklin & Daniel J. Bussell, The Plaintiff’s Burden in Defamation: Awareness and Falsity, 25
WM. & MARY L.REV. 825, 860 (1984). “A plaintiff is in the best position to know the facts about
his own life and activities that will establish falsity. A plaintiff’s simple denial would perhaps be
sufficient in the abnormal situation of a defendant who publishes statements that conclusively
defame without providing some information that would indicate truth. If the defendant included
information tending to indicate truth, however, the plaintiff, who has access to the facts of his life,
can be expected to discharge the burden of overcoming the suspicious circumstances.” W. Page
Keeton, Defamation and Freedom of the Press, 54 TEX.L.REV. 1221, 1235 (1976). Here,
Alphonso is in a better position than Appellees to test the truth of a statement made about him
given that the accusation that funds were misappropriated while he was in charge of St. Jude’s is
specific as to time or place. See Marc A. Franklin & Daniel J. Bussell, The Plaintiff’s Burden in
Defamation: Awareness and Falsity, 25 WM. & MARY L.REV. at 859. Alphonso, however, fails
to deny that he misappropriated funds. Instead, he contends that the settlement agreement
establishes that he is not liable. But the refusal to admit liability or wrongdoing for an act is not
synonymous with the denial of that act. Accordingly, Alphonso cannot rely on the settlement
agreement in discharging his evidentiary burden to establish by clear and specific evidence a prima
facie case that Bishop Deshotel’s statement is, in fact, false because he did not misappropriate
donations intended for St. Jude.
Second, as reflected in the Act, a civil defendant enjoys the benefit of a presumption that he
spoke the truth. See id. at 860. As was noted above, the movant need only satisfy the initial
burden of proof by a preponderance of the evidence to be entitled to relief. In contrast, the
non-movant must satisfy the heightened burden of proof by clear and convincing evidence of a
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prima facie case to prevent dismissal. “The requirement of convincing clarity reflects the
[Legislature’s] desire to protect defendants from being held liable on barely sufficient evidence
and requires courts to resolve doubtful cases in favor of the defendants.” Marc A. Franklin &
Daniel J. Bussell, The Plaintiff’s Burden in Defamation: Awareness and Falsity, 25 WM. & MARY
L.REV. at 856. This is further reflected in the Legislature’s pronouncement that the Act is to “be
construed liberally to effectuate its purpose and intent fully.” TEX.CIV.PRAC.&REM.CODE ANN.
§ 27.011(b)(West Supp. 2013). Alphonso’s testimony is simply not enough to overcome this
presumption and demonstrate by clear and specific evidence a prima facie case that Bishop
Deshotel’s statement is, in fact, false.
Alphonso’s first issue is overruled.
CONSTITUTIONALITY OF THE TEXAS CITIZENS PARTICIPATION ACT
In his second issue, Alphonso argues Chapter 27 violates the “open courts” provision of the
Texas Constitution. But Alphonso never raised his constitutional complaint in the trial court, and
therefore he has failed to preserve it for appellate review. See, e.g., TEX.R.APP.P.
33.1(a)(1)(complaints raised on appeal must first be raised in the trial court); Sw. Elec. Power Co.
v. Grant, 73 S.W.3d 211, 222 (Tex. 2002)(open-courts challenges are waived on appeal if not
raised at trial); S.V. v. R.V., 933 S.W.2d 1, 25 (Tex. 1996)(same); City of San Antonio v. Schautteet,
706 S.W.2d 103, 104-05 (Tex. 1986)(per curiam)(same).
Alphonso contends that “the rule from Grant [and Schautteet] should not apply here”
because “[t]his appeal does not arise out of a summary judgment, and Chapter 27 [, unlike Texas
Rule of Civil Procedure 166(a),] does not [explicitly require that challenges be presented to the
trial court first].” However, the legal principle requiring a litigant to preserve constitutional
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challenges—including open-courts challenges—by raising them first in the trial court is broad in
nature and not limited solely to summary judgment proceedings. See S.V., 933 S.W.2d at 25
(concluding that party in divorce action waived argument that open-courts provision required
application of the discovery rule by failing to raise argument in the trial court); Dreyer v. Greene,
871 S.W.2d 697, 698 (Tex. 1993)(holding that party in paternity suit waived due process and equal
protection challenges by failing to raise them in the trial court).
Alphonso also contends that he did not waive his constitutional challenge to the Act by
failing to raise it in the trial court because appellate courts “can address ‘fundamental issues of
constitutionality’ for the first time on appeal” and cites Ramsey v. Dunlop, 146 Tex. 196, 205
S.W.2d 979 (1947) in support. But Alphonso’s reliance on Ramsey is misplaced. Although the
Texas Supreme Court recognized in Ramsey that appellate courts may consider unpreserved error
that is “fundamental,” it did not identify open-courts challenges as fundamental. 205 S.W.2d at
983. Instead, the Supreme Court broadly defined “fundamental error” as “an error which directly
and adversely affects the interest of the public generally, as that interest is declared in the statutes
or Constitution of this State . . . .” Id.
Since Ramsey, appellate courts have recognized fundamental error in a few, limited
circumstances. The first is when the record shows on its face that the court lacked jurisdiction.
See McCauley v. Consolidated Underwriters, 157 Tex. 475, 304 S.W.2d 265, 266 (1957)(per
curiam)(concluding error is fundamental when the record shows a jurisdictional defect). The
second is when the rights and welfare of minors are implicated. See In re C.O.S., 988 S.W.2d
760, 767 (Tex. 1999)(reviewing trial court’s failure to give mandatory statutory admonishments in
a juvenile delinquency proceeding); State v. Santana, 444 S.W.2d 614, 615 (Tex. 1969), cert.
8
granted, but subsequently vacated on other grounds, 397 U.S. 596, 90 S. Ct. 1350, 25 L. Ed. 2d 594
(reviewing submission of “preponderance of the evidence” as the burden of proof in a juvenile
delinquency case); R.A.M. v. State, 599 S.W.2d 841, 846 (Tex.Civ.App.--San Antonio 1980, no
writ)(reviewing submission of an invalid theory of liability in a juvenile delinquency case);
Woodard v. Tex. Dep’t of Human Resources, 573 S.W.2d 596, 597 (Tex.Civ.App.--Amarillo 1978,
writ ref’d n. r. e.)(reviewing submission of “preponderance of the evidence” as the burden of proof
in a parental-rights termination case); Rey v. Rey, 487 S.W.2d 245, 248 (Tex.Civ.App.--El Paso
1972, no writ)(reviewing omission in a jury charge in a divorce case that deprived a minor child of
the right to support). Notably, the Texas Supreme Court refused to extend the fundamental-error
doctrine to unpreserved charge error in parental termination cases because, in large part, the
Supreme Court failed to “see any reasonable, practical, and consistent way of reviewing
unpreserved complaints of charge error in termination cases that satisfies our narrow
fundamental-error doctrine.” In re B.L.D., 113 S.W.3d 340, 351 (Tex. 2003).
Given that the fundamental-error doctrine is narrow in scope and that the Texas Supreme
Court has repeatedly held that open-courts challenges are waived on appeal if not preserved in the
trial court, we conclude that Ramsey does not support Alphonso’s contention that he can challenge
the constitutionality of Chapter 27 on appeal for the first time. See In re B.L.D., 113 S.W.3d at
351; Grant, 73 S.W.3d at 222; S.V., 933 S.W.2d at 25; Schautteet, 706 S.W.2d at 104-05.
Alphonso’s second issue is overruled.
ATTORNEY’S FEES
In his third and final issue, Alphonso argues the trial court erred in awarding Appellees
attorney’s fees and costs because there is no evidence supporting the award. We agree.
9
Applicable Law
The Act mandates the award of attorney’s fees and costs to a successful movant. See
TEX.CIV.PRAC.&REM.CODE ANN. § 27.009(a)(1)(West Supp. 2013). Nevertheless, a party
seeking attorney’s fees and costs bears the burden to put forth evidence regarding its right to the
award, as well as the reasonableness and necessity of the amount of the fee. Brownhawk, L.P. v.
Monterrey Homes, Inc., 327 S.W.3d 342, 348 (Tex.App.--El Paso 2010, no pet.).
Discussion
Appellees failed to satisfy their burden to put forth evidence regarding their right to recover
attorney’s fees and costs in this case. Appellees did not attach to any of their pleadings
documents supporting the award of attorney’s fees and costs, nor did they prove their entitlement
to fees and costs at the hearing on their motion to dismiss. The transcript of the hearing reveals
that though Appellees offered the affidavit of Michael Moran, their counsel of record, in support of
their request for attorney’s fees and costs, the trial court neither admitted nor excluded the offer.
Instead of ruling on the offer of evidence, the trial court permitted Alphonso to file objections, if
any, to the affidavit within a reasonable time after the hearing. Alphonso filed his objections
three days after the hearing. One week later, the trial court granted the motion to dismiss
and—despite never having admitted Moran’s affidavit into evidence or ruled on Alphonso’s
objections—awarded Appellees the attorney’s fees and costs requested by them. The trial court
erred, however, in awarding Appellees attorney’s fees and costs.
Appellees burden in producing evidence and proving their entitlement to attorney’s fees
and costs included obtaining a ruling on their offer of Moran’s affidavit. Ruth v. Imperial Ins.
Co., 579 S.W.2d 523, 525 (Tex.Civ.App.--Houston [14th Dist.] 1979, no writ). “Evidence which
10
is not admitted cannot be considered proof in the case.” Ruth, 579 S.W.2d at 525. It is presumed
that the trial court makes its decision based “on the competent and admissible evidence” before it
when it acts. Id; Methodist Hosps. of Dallas v. Tall, 972 S.W.2d 894, 898 (Tex.App.--Corpus
Christi 1998, no pet.)(“It is axiomatic that an appellate court reviews actions of a trial court based
on the materials before the trial court at the time it acted.”). Here, because Appellees never
obtained a ruling from the trial court admitting Moran’s affidavit into evidence, there was no
competent proof of attorney’s fees and costs before the trial court when it awarded fees and costs
to Appellees.5 See Gilbert v. City of El Paso, 327 S.W.3d 332, 337-38 (Tex.App.--El Paso 2010,
no pet.)(concluding that there was no evidence to support the award of appellate attorney’s fees
because affidavits and supporting documents to establish the amount of attorney’s fees were never
admitted and instead the trial court simply entered a final judgment awarding fees).
Appellees do not argue—as the appellee did successfully in Brownhawk—that we should
uphold the award of attorney’s fees and costs on appeal because Moran’s affidavit is part of the
appellate record. See Brownhawk, 327 S.W.3d at 348-49. But even had Appellees made this
argument and relied on Brownhawk in making it, we would not have been swayed because
Brownhawk is distinguishable. In that case, the trial court, at the close of evidence, awarded
appellees attorneys’ fees. 327 S.W.3d at 344. On appeal, the appellant argued that “the
appellate record is devoid of evidence to support the [trial] court’s award.” Id. at 348 [Emphasis
added]. We disagreed, concluding that there was evidence in the appellate record to support the
award because the appellee supplemented the appellate record with the affidavit supporting the
5
Indeed, the trial court signed an order sustaining Alphonso’s objections to Moran’s affidavit more than one month
after the trial court dismissed Alphonso’s suit and awarded fees and costs to Appellees. But the trial court’s order is
of no significance. When the trial court awarded Appellees attorney’s fees and costs, there was simply no competent
and admissible evidence of fees and costs to support their award.
11
award of attorney’s fees and established to our satisfaction that the affidavit “was before the [trial]
court when it entered its judgment . . . .” Brownhawk, 327 S.W.3d at 348-49. But the issue here
is not whether the appellate record is devoid of evidence to support the award of attorney’s fees
and costs, but rather whether there was any competent and admissible evidence before the trial
court when it awarded the fees. Unlike the appellant in Brownhawk, Alphonso argues here that no
such evidence existed at trial to support the award of attorney’s fees. As discussed above, we
agree with Alphonso.
Alphonso asks that we reverse and render a take-nothing award on this issue. However,
given that Appellees are entitled to attorney’s fees and costs under the Act because the trial court
granted their motion to dismiss and we have upheld that ruling on appeal, the proper disposition in
this case is to reverse the award of attorney’s fees and costs and remand that issue back to the trial
court for a new trial. See ASAI v. Vanco Insulation Abatement, Inc., 932 S.W.2d 118, 124
(Tex.App.--El Paso 1996, no writ)(sustaining appellant’s challenge to the trial court’s award of
$2,500 attorney’s fees to appellee for responding to a motion for new trial because the evidence
was insufficient to support such award, but reversing and to the trial court for a determination of
reasonable and proper attorney’s fees); Smith v. Smith, 757 S.W.2d 422, 426 (Tex.App.--Dallas
1988, writ denied)(“When a trial court grants an award of attorney’s fees without any evidence in
the record to support such an award, the proper action on appeal is to remand that part of the
judgment awarding attorney’s fees for a determination of the reasonableness of the amount of
attorney’s fees to be awarded.); Uhl v. Uhl, 524 S.W.2d 534, 538 (Tex.Civ.App.--Fort Worth
1975, no writ)(“When a plaintiff is clearly entitled to attorney’s fees in some amount but where
there had been no proof in the trial court of the amount there may be severance of that issue with
12
remand to the trial court for a new trial on that issue.”).
Alphonso’s third issue is sustained in part and overruled in part.
CONCLUSION
The portion of the trial court’s judgment pertaining to the award of attorney’s fees and
costs is reversed and remanded for a new trial on that issue. In all other respects, the judgment of
the trial court is affirmed.
November 20, 2013
YVONNE T. RODRIGUEZ, Justice
Before McClure, C.J., Rodriguez, J, and Barajas, Senior Judge
Barajas, Senior Judge (Sitting by Assignment)
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