In the Estate of Billy Wayne Phillips v. the State of Texas ( 2024 )

In the
Court of Appeals
Sixth Appellate District of Texas at Texarkana
No. 06-23-00017-CV
IN THE ESTATE OF BILLY WAYNE PHILLIPS, DECEASED
On Appeal from the County Court at Law No. 2
Hunt County, Texas
Trial Court No. 18697
Before Stevens, C.J., van Cleef and Rambin, JJ.
Memorandum Opinion by Chief Justice Stevens
Dissenting Opinion by Justice Rambin
MEMORANDUM OPINION
The last will and testament of Billy Wayne Phillips devised all of his estate, including “an
approximately fourteen-acre tract of land in Hunt County (the Property),” to two of his children,
Sheila Juanita Smith and Billie Kimberly Hudson. See Est. of Phillips, No. 06-22-00015-CV,
2022 WL 2919505, at *1 (Tex. App.—Texarkana July 26, 2022, no pet.) (mem. op.) (footnote
omitted). “Phillips’s will was admitted to probate in the County Court at Law No. 2 of Hunt
County, and Smith was appointed independent executrix of Phillips’s estate.” Id. Phillips’s will
gave Smith “‘full power and authority over any and all of [his] estate’ and authorized her ‘to sell,
manage, and dispose of the same or any part thereof . . . and to do any and all things proper or
necessary in the orderly handling and management of [his] estate.’” Id. (alterations in original).
As a result, in a prior opinion, we held that Smith had the superior right to possess the Property
and upheld the trial court’s order requiring Hudson to turn over the Property to Smith so she
could proceed with the due administration of Phillips’s estate.1 Id. at *4–5.
Now, Hudson appeals from the trial court’s order of sale. On appeal, Hudson argues that
the trial court erred by striking her partition claims. Alleging that her partition claims are valid,
Hudson also argues that the trial court erred by ordering the property sold before deciding the
partition claims on the merits. We affirm the trial court’s order of sale because, at the time it was
entered, Hudson had no partition claims in her live pleading.
1
Smith’s application for turnover stated that she wished “to proceed with marketing and the sale of the Property so
that she [could] pay any outstanding debts of the estate and costs of administration.”
2
I. Factual and Procedural Background
The unique procedural facts dictate the outcome in this case. They show that, while
Hudson once asserted claims of partition, she abandoned her right to appeal them.
On February 15, 2022, Hudson filed a petition in intervention seeking partition of the
Property in kind pursuant to both Chapter 23A of the Texas Property Code and Sections 360.001,
et seq., of the Texas Estates Code. In response, Smith moved to dismiss the Chapter 23A
partition claim under Rule 91a of the Texas Rules of Civil Procedure on the ground that it had no
basis in law because Phillips’s will did not devise specific real property to Hudson and expressly
gave Smith the power of sale. On April 14, 2022, the trial court dismissed Hudson’s partition
suit “under Texas Property Code [Chapter] 23A” and awarded Smith attorney fees. Hudson
appealed that decision, and, in a prior opinion, we explained that we lacked jurisdiction to
address the merits of Hudson’s complaint because “the order of dismissal did not dispose of that
portion of the Partition Suit brought under Section 360.001, et seq., of the Texas Estates Code.”
Id. at *6.
After our opinion issued, Smith later filed a motion for summary judgment on Hudson’s
remaining Chapter 360 partition claim, arguing that the will provided no means for partition and
instead authorized sale of the Property.2 On September 19, 2022, the trial court granted Smith’s
summary judgment motion on the Chapter 360 partition claim.
2
Hudson filed a first amended petition in intervention arguing that Phillips “intended to divide his real property by
giving 7 acres to [Hudson] and 7 acres to Smith corresponding to the location of their respective manufactured
homes.” Hudson’s first amended petition asserted breach of fiduciary duty against Smith, negligence, and again
sought partition pursuant to Chapters 23 and 23A of the Texas Property Code and Chapter 360 of the Texas Estates
Code. Hudson appealed the trial court’s November 17, 2022, order on special exceptions to her first amended
3
As a result, “Hudson no longer [sought] to pursue partition under . . . section [360.001, et.
seq.].” She filed an amended petition asserting Chapter 23 and 23A partition claims. In
response, Smith filed a special exception because “[a]ll grounds for relief under Texas Property
Code [Section] 23A.003 et seq. [and Section 23.001, et seq.,] [were] dismissed by this court and
therefore [were] no longer viable causes of action.” To cure this issue, on October 21, 2022,
Hudson filed a second amended petition that removed her partition claim under Chapter 360 of
the Texas Estates Code but retained partition in kind claims under Chapters 23 and 23A of the
Texas Property Code. The trial court found that the second amended petition “d[id] not cure the
defects as alleged in [Smith’s] Special Exceptions” and struck the Chapters 23 and 23A partition
claims. Then, the second amended petition was supplanted by Hudson’s third amended petition
filed on November 23, 2022.
Hudson’s third amended petition added Stormie Lea Brown3 as an intervenor, retained
breach of fiduciary duty and negligence claims against Smith in her individual capacity, and
asserted unjust enrichment and conversion claims on behalf of both Hudson and Brown. The
third amended petition noted that Smith had a contract for sale on the Property but did not seek
partition in kind. Instead, it asked the trial court to prevent the sale of the Property.4
petition in intervention, but we dismissed the appeal for want of jurisdiction because Hudson had remaining
conversion claims, and “[t]he partition claims were obviously only a part of the intervention proceedings.” Est. of
Phillips, No. 06-22-00092-CV, 2023 WL 2905386, at *1 (Tex. App.—Texarkana Apr. 12, 2023, no pet.) (mem.
op.). Hudson did not appeal our prior order.
The petition alleged that Phillips had gifted one acre of real property adjacent to the Property to Hudson’s daughter,
3
Brown, who had built a home on the parcel of land.
4
Smith moved to dismiss the third amended petition in intervention.
4
On February 9, 2023, the trial court entered an order finding that Smith had the power to
sell the Property without further order of the court. Smith filed a notice appealing the February 9
order.5
II. Hudson Had No Viable Partition Claims Pending Before the Trial Court
While Hudson appeals the order of sale, all of her arguments are related to the issue of
partition in kind under Chapters 23 and 23A of the Texas Property Code. Specifically, she
complains of the trial court’s prior orders regarding partition made in reference to superseded
pleadings and argues that “Hudson’s partition claims must be properly addressed and resolved on
the merits before the court can consider whether Smith has the right to sell the real property.” In
sum, Hudson maintains that her partition-in-kind claims are viable.
We disagree. Our review of the record shows that Hudson failed to raise any partition
claims in her third amended petition in intervention. This is critical because the live petition
superseded Hudson’s prior petitions. See Lake Jackson Med. Spa, Ltd. v. Gaytan, 640 S.W.3d
830, 839 n.7 (Tex. 2022) (“We do not consider Gaytan’s original or first-amended petitions
because her second-amended petition superseded the prior petitions.” (citing Bos v. Smith, 556
S.W.3d 293, 306 (Tex. 2018) (“Amended pleadings supersede prior pleadings, and any claim not
carried forward in an amended pleading is deemed dismissed.”))); Bean v. Reynolds Realty Grp.,
Inc., 192 S.W.3d 856, 861 (Tex. App.—Texarkana 2006, no pet.); J.M. Huber Corp. v. Santa Fe
Energy Res., Inc., 871 S.W.2d 842, 844 (Tex. App.—Houston [14th Dist.] 1994, writ denied)
5
Although the remaining intervention claims are pending, Smith appeals the power of sale. There is no question that
we have jurisdiction over this appeal. As a result, the parties did not dispute our appellate jurisdiction.
5
(describing that “[a]n amended petition . . . supersedes all prior petitions and operates to dismiss
. . . causes of action to the extent they are omitted from the amended pleading”).
Relevant to our conclusion, the Texas Supreme Court has written:
In civil causes generally, filing an amended petition that does not include a cause
of action effectively nonsuits or voluntarily dismisses the omitted claims as of the
time the pleading is filed. No hearing is necessary to effect the nonsuit. . . . Our
rules provide that amended pleadings and their contents take the place of prior
pleadings. TEX. R. CIV. P. 65. So, causes of action not contained in amended
pleadings are effectively dismissed at the time the amended pleading is filed,
except for possible circumstances not present here. See Ortiz v. Collins, 203
S.W.3d 414, 421 n.4 (Tex. App.—Houston [14th Dist.] 2006, no pet.) (amended
pleading specifically reserved right to re-assert or appeal trial court order
dismissing causes of action and which causes of action were, therefore, not
pleaded in the amended pleading).
FKM P’ship, Ltd. v. Bd. of Regents of Univ. of Houston Sys., 255 S.W.3d 619, 632–33 (Tex.
2008). Seizing on the Texas Supreme Court’s citation to Ortiz,6 the dissenting opinion states it
would apply the Ortiz exception to revive Hudson’s abandoned claims based on language in the
third amended petition, which stated,
Intervenors do not waive or release any rights, claims, causes of action, or
defenses, or make any election of remedies that they have or may have, but
instead expressly reserve such rights, claims, and causes of action.
. . . . Further, Intervenors reserve the right to re-assert / re-plead causes of action
that have been dismissed by this Court without prejudice, and/or causes of action
that a court of appeals may determine were wrongly dismissed by the trial court.
But Ortiz is easily distinguished.
In Ortiz, the appellees asserted that Ortiz abandoned some of his claims by failing to
include them in an amended petition. Ortiz, 203 S.W.3d at 421 n.4. The trial court granted
6
Ortiz, 203 S.W.3d 414.
6
summary judgment on and dismissed all of Ortiz’s claims, including the claims omitted from the
amended petition. Id. at 419. As a result, the appellate court addressed Ortiz’s appeal of the
summary judgment on all his claims. Id. at 421. This is not the procedural posture presented
here.7
Also, the reservation in the amended petition in Ortiz stated, “By this pleading, Plaintiff
gives notice that he does not waive and expressly reserves his right to pursue or re-assert either
in this court and/or on appeal those causes of actions [sic] previously dismissed by the Court and
not re-pled herein.” Id. at 421 n.4 (emphasis added) (alteration in original). While the Ortiz
reservation reserved specific causes of action dismissed by the trial court for purposes of appeal,
Hudson’s reservation did not reserve a right to pursue causes of action previously dismissed for
purposes of appeal. Instead, she only “reserve[d] the right to re-assert / re-plead causes of action
that have been dismissed by this Court without prejudice.”8 But Hudson acknowledged that the
trial court’s grant of Smith’s special exceptions “effectively dismiss[ed] all . . . of Hudson’s
Partition claims with prejudice.” In fact, Hudson’s claims were not “effectively” dismissed with
prejudice, they were dismissed with prejudice. This is because where, as here, “the defect is not
curable, dismissal is with prejudice.”9 In re Shire PLC, 633 S.W.3d 1, 13 (Tex. App.—
Texarkana 2021, orig. proceeding) (citing Joseph E. Seagram & Sons, Inc. v. McGuire, 814
The dissent characterizes “Hudson’s omission of Chapter 23A from her most recent petition [a]s a jurisdictional
7
matter.” It is not. Rather, this is a matter of waiver.
Although the reservation also stated that Hudson reserved “causes of action that a court of appeals may determine
8
were wrongly dismissed by the trial court,” no appellate opinion has determined that any cause of action was
wrongly dismissed.
9
Although in Shire we stated that a dismissal with prejudice ends the litigation, there are other claims in intervention
that are still pending here.
7
S.W.2d 385, 386 (Tex. 1991)). Because the Chapter 23 and 23A partition claims were dismissed
on the ground that they had no basis in law, the trial court’s special exceptions order ruled that
Hudson tried, but failed, to cure the defects raised by Smith’s special exceptions because they
were incurable. Accordingly, the dismissal of the partition claims was with prejudice. Because
Hudson only reserved those claims that were dismissed without prejudice, the Ortiz exception
does not apply. Instead, the general rule stated in Lake Jackson and FKM Partnership operates
to result in the conclusion that Hudson abandoned her partition claims.
As a result, the trial court did not err by entering the order of sale.
IV. Conclusion
We affirm the trial court’s judgment.
Scott E. Stevens
Chief Justice
DISSENTING OPINION
Billy Phillips died on April 17, 2019, leaving the land at issue as the principal asset of his
estate. Smith’s initial inventory, filed on October 20, 2021, estimated the 14.1 acres at issue to
be worth $190,660.00 of the estate’s total value of $337,480.49. Smith did not list any debts of
the estate. Smith’s accounting, filed on January 23, 2023, showed that she had used the estate’s
cash-in-hand to pay the late fee on the property taxes for 2020 and to make timely payment of
the property taxes for 2021. Property taxes for 2022 had accrued during the pendency of the
8
estate in the amount of $4,637.20, which exceeded the remaining cash-in-hand, but the estate had
an old pickup and a flatbed trailer to sell. More than three years after Phillips’s death, the
biggest debt Smith asserted the estate owed was “administration cost and attorney’s fees in the
amount of $36,048.60,” which is more than a tenth of the estate’s value. In sum, the sisters’
dispute over whether to sell or split the land has brought about both delay and expense, most of
which is due to uncertainty over the impact of a new statute, the Uniform Partition of Heirs
Property Act, Chapter 23A of the Texas Property Code.
The majority holds that Hudson’s omission of Chapter 23A from her most recent petition
is a jurisdictional matter that prevents this Court from reaching the merits of the sisters’ dispute,
namely the application, if any, of Chapter 23A during the administration of an estate by an
executor. There is much strength to the general rule that either a cause of action is in a petition
or it is not. See Lake Jackson Med. Spa, Ltd., 640 S.W.3d at 840 (citing FKM P’ship, Ltd., 255
S.W.3d at 632). Nine times out of ten, or maybe ninety-nine times out of one hundred, it would
undermine the predictability of litigation and would be a net drain on judicial resources to be
embroiled in satellite questions over the meaning and procedural context of savings clauses in
petitions.
This case, however, has been before us twice before. Est. of Phillips (Estate of
Phillips I), 2022 WL 2919505, at *1; Est. of Phillips (Estate of Phillips II), 2023 WL 2905386.
In Estate of Phillips I, we upheld the trial court’s order requiring Hudson to turn the property
over to the executor, Smith. In Estate of Phillips II, we held that Hudson’s arguments regarding
Chapter 23A had not yet matured under the probate exception to the “‘one final judgment’
9
rule,”10 because the ruling then on appeal did not dispose of all issues in the “phase”11 of the
litigation regarding the property. Now Hudson’s arguments have matured because this is the last
stop before Smith sells the land. But we tell Hudson she has no appeal because she dropped
Chapter 23A from her most recent petition. Hudson’s third amended petition had savings clause
language.12 Hudson filed this at a time when Estate of Phillips II was pending, and she went on
to initiate the present appeal, Estate of Phillips III, while Estate of Phillips II was pending.
The Texas Supreme Court has provided an exception that may apply when the trial court
has ruled against a party’s cause of action and the party repleads without expressly asserting that
cause of action, but with a reservation clause asserting that the party maintains the right to appeal
and, if successful on appeal, to proceed on the cause of action from the prior petition. FKM
P’ship, Ltd., 255 S.W.3d at 632 (citing Ortiz, 203 S.W.3d at 421 n.4). I do not comment on the
scope of that exception other than to say that I would apply it to the unique facts of this case.
As a result, I would reach the merits of the Chapter 23A question. Admittedly, there is
scant authority in this field. Both of the sisters rightly accuse the other of failing to cite a single
case holding that Chapter 23A prevails over the authority of an executor of an estate to collect
and dispose of estate assets, or holding the opposite, or holding Chapter 23A must be meshed
10
Est. of Phillips, 2023 WL 2905386, at *1 (quoting De Ayala v. Mackie, 193 S.W.3d 575, 578 (Tex. 2006)).
11
Id. (quoting De Ayala, 193 S.W.3d at 579).
12
Stating that Hudson “reserve[d] the right to re-assert / re-plead causes of action that have been dismissed by [the
trial court] without prejudice, and/or causes of action that a court of appeals may determine were wrongly dismissed
by the trial court.”
10
with existing probate procedures.13 Indeed, were we to squarely decide these issues, it appears
that we would be the first to do so.14 As the history of the estate of Phillips demonstrates, there
is need for a “yes” or “no” answer to whether Chapter 23A applies to the administration of an
estate by an executor.
Accordingly, I dissent.
Jeff Rambin
Justice
Date Submitted: October 5, 2023
Date Decided: February 8, 2024
Hudson states, “None of the cases cited in Smith’s motion [in the trial court] addresses the interaction between
13
powers granted in a will and the right to seek a partition [under Chapter 23A].” Smith, for her part, states, “Hudson
offers no authority supporting her implication that 23A supercedes [sic] the Texas Estates Code or the terms of a
will.”
14
Our sister court in San Antonio has cited the availability of Chapter 23A during estate administration as a reason to
believe that executors do not have unfettered reign to dispose of estate property, but must instead act as fiduciaries,
and thereby perhaps avoid Chapter 23A being invoked. In re Est. of Stewart, No. 04-20-00103-CV, 2021 WL
1987541, at *9 (Tex. App.—San Antonio May 19, 2021, pet. denied) (mem. op.). In other words, while In re Estate
of Stewart mentioned Chapter 23A, it did not deal with a party actually invoking it. Id.11