David Penny v. El Patio, LLC D/B/A El Patio Motel

ACCEPTED
03-11-00420-CV
4949300
THIRD COURT OF APPEALS
AUSTIN, TEXAS
4/20/2015 11:22:15 AM
JEFFREY D. KYLE
CLERK
COURT OF APPEALS
. THIRD DISTRICT OF TEXAS
AUSTIN, TEXAS FILED IN
3rd COURT OF APPEALS
AUSTIN, TEXAS
4/20/2015 11:22:15 AM
NO. 03-11-00420-CV JEFFREY D. KYLE
Clerk
DAVID PENNY,
Appellant,
vs.
EL PATIO, LLC d/b/a EL PATIO MOTEL
Appellee.
LEITER BRIEF OF APPELLEE EL PATIO, LLC d/b/a EL PATIO MOTEL
Stephen H. Nickey
State Bar ID No. 15014225
sn ickey@n ickeylaw .com
The Law Offices of Stephen H. Nickey, P.C.
1201 North Mesa Suite B
EIPaso, Texas79902
(915) 351-6900
(915) 351-6901 fax
Standard of Review
At oral argument held in San Angelo, Texas, Chief Justice Rose asked the
parties to brief whether the standard of review was De Novo or abuse of
discretion. The correct standard of review is abuse of discretion. The Texas
Supreme Court reviewed a trial court's ruling on a motion to show authority
applying an abuse of discretion standard in Urbish v. 127th Judicial Dist. Court,
708 S.W.2d 429 (Tex. 1986). The Dallas Court of Appeals followed Urbish and
reviewed a Rule 12 motion under abuse of discretion in R.H. v. Smith, 339 S.W.3d
756 (Tex.App.-Dallas 2011, no pet.). One year later, the San Antonio Court of
Appeals followed Urbish and Smith and applied abuse of discretion to its review of
a trial court's ruling on a motion to show authority. See In re Guardianship of
Benavides, 403 S.W3d 370, 373 (Tex.App.-San Antonio 2013, no pet.). Even
more recently, the Houston and the Corpus Christi Courts of Appeals have
followed Urbish, Smith and Benavides and adopted an abuse of discretion
standard for reviewing a ruling on a Rule 12 motion. See In re Old Am. County
Mutual Fire Ins. Co., No. 13-13-00644-CV (Tex.App.-Corpus Christi April 23, 2014,
orig. proceeding); Tanner v. Black, No. 01-13-01059-CV, 2015 WL 1122945(Tex.App.-Houston [1st Dist.] March 12, 2015, no pet.). Abuse of discretion is the
correct standard of review, among other things, because ''when making a
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determination under rule 12, trial courts consider and weigh the evidence
presented." Benavides, 403 S.W.3d at 376 (citing Smith, 339 S.W.3d at 762-63}.
As such, to succeed on appeal, the appellant is ((required to establish that the trial
court could have reached only one decision on the motion to show authority."
/d. at 377.
There is contrary but reconcilable authority. The Austin Court of Appeals
applied a de novo standard of review to a ruling on a Rule 12 motion in Metz v.
Lake LBJ Municipal Utility Dist., No. 13-01-00312-CV, 2002 WL 31476887(Tex.App.-Austin Nov. 7, 2002, no pet.}. Without considering Urbish or its
progeny, the Court stated that, ((The district court's finding that _an attorney lacks
authority to file or maintain a suit is a conclusion of law ... ," and, u[a]s a conclusion
of law, we review de novo the district court's findings." /d. at *3. The Court cited
to State v. Evangelical Lutheran Good Samaritan Society, 981 S.W.2d 509(Tex.App.-Austin 1998, no pet.} for this proposition, which in turn relies on Golf
Reg'/ Educ. Television v. University of Houston, 746 S.W.2d 803 (Tex.App.-
Houston [14th Dist.] 1988, writ denied}. However, neither of the three cases
addressed Urbish and they are therefore contrary to Texas Supreme Court
precedent. Further, the holdings in Metz, Evangelical and Golf can be reconciled
with Urbish, Smith and Benavides. For example, the court in Metz found that the
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attorney had failed to appear at the hearing on the motion to show authority and
therefore did not meet his burden under Rule 12. Metz, 2002 WL 3147688 at *4.
The court noted that the trial court had taken judicial notice of evidence
presented in the underlying proceeding, but the court did not conduct a de novo
review of such evidence. /d. The court in Evangelical applied a de novo standard
of review, because the Rule 12 motion in that case turned on purely legal
question. The question before the court was whether the Texas Attorney General
had the statutory authority to enforce Chapter 242 of the Texas Health and Safety
Code. See Evangelical, 981 S.W.2d at 511-12. De novo review of purely legal
questions is consistent with abuse of discretion review. See Old American, 2014
WL 1633098 at *6 ("A trial court also abuses its discretion by failing to analyze or
apply the law correctly.") (citing Lliff v. Lliff, 339 S.W.3d 74 (Tex. 2011)). Finally,
the Court in Gulf did not address the standard of review in a Rule 12 motion and
instead gave deference to the fact findings of the trial court similar to an abuse of
discretion analysis. See Gulf, 746 S.W.2d at 808-09 (reviewing the evidence
before the trial court and concluding that "[w]ithout an exhaustive analysis, we
find support for the trial court's conclusions."). As such, the correct standard of
review of a trial court's ruling on a Rule 12 motion is abuse of discretion.
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Evidence attached to El Patio's Response to Motion to Show Authority
The Court asked during oral argument whether El Patio had filed any
evidence with its original response to the motion to show authority. Counsel
advised the Justices that he was not sure at oral argument and in an abundance of
caution, El Patio hereby directs to the Court to the record citations for such
evidence. El Patio filed its Response on November 1, 2010. CR 700-709. El Patio
attached to its Response the affidavit of Steven Hyde (CR 710-718), which in turn
included multiple exhibits, such as the Operating Agreement (CR 719-734} and the
three unanimous consents (CR 754-765} .
Respectfully Submitted,
The Law Offices of Stephen H. Nickey P.C.
1201 N. Mesa Suite B
El Paso, Texas 79902
(915} 351-6900
(915} 35106901
snickey@ nickeylaw.com
/s/ Stephen H. Nickey
Attorneys for Appellee,
El Patio, LLC d/b/a El Patio Motel
CERTIFICATE OF SERVICE
I, Stephen H. Nickey, hereby certify that on this 20th day of April, 2015, the
foregoing letter brief was electronically filed with the Clerk of the Court using the
e-filing system provider, which will provide notice to lead counsel for Appellant,
Greg Gossett, Esq. (gregg@ghtxlaw.com) and all other counsel of record.
/sf Stephen H. Nickey
Stephen H. Nickey
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