in Re: Pendragon Transportation LLC

GRANT in Part and DENY in Part; Opinion Filed February 21, 2014.
S In The
Court of Appeals
Fifth District of Texas at Dallas
No. 05-13-01749-CV
IN RE: PENDRAGON TRANSPORTATION LLC, Relator
On Appeal from the 193rd Judicial District Court
Dallas County, Texas
Trial Court Cause No. DC-13-01313-L
OPINION
Before Justices Moseley, Fillmore, and Brown
Opinion by Justice Brown
Relator Pendragon Transportation LLC filed this mandamus proceeding after the trial
court signed an order appointing a special master for the purpose of attending depositions in this
case to make rulings on any objections, assertions of privilege, and instructions not to answer
questions. In its order, the court required Pendragon to pay the special master’s fees in advance
of each deposition, subject to reallocation later. Pendragon asserts both actions were an abuse of
discretion. We conclude Pendragon has waived its complaint about the appointment of the
special master due to its delay in filing its petition for writ of mandamus. We further conclude
the trial court abused its discretion in ordering Pendragon to pay the special master’s fees up
front. Accordingly, we conditionally grant the writ of mandamus in part and deny it in part.
Pendragon sued six defendants for various causes of action, including breach of contract
and misappropriation of trade secrets. In April 2013, after the deposition of Pendragon’s
corporate representative, Nicholas Massey, defendant Black Bull Towing LLC filed a “motion to
compel answers at deposition.” Black Bull asserted that at the deposition, Pendragon’s attorney
instructed Massey not to answer basic questions as well as questions about a non-compete
clause, which is the basis for Pendragon’s lawsuit, and questions about any documents Massey
brought to the deposition. Black Bull sought an order requiring Massey to answer the questions
asked in the deposition. It is not clear whether the court ruled on this motion, but at some point,
due to “the inability of Counsel to cooperate on basic matters,” the court ordered depositions to
take place at the courthouse so the court would be available to rule on objections.
On June 12, 2013, defendant Victor Huhem took Massey’s deposition, both in his
corporate capacity and in his individual capacity. The deposition took place in the court’s jury
room. At the start of the deposition of Massey in his corporate capacity, Pendragon’s attorney
indicated Massey would not return in the afternoon to participate in a deposition in his individual
capacity because the subpoena was invalid. Stating that it would be a complete waste of time to
have Massey come back another time, the court ruled that Massey would be deposed in both
capacities.
Throughout the depositions, Pendragon’s attorney frequently objected and sometimes
instructed Massey not to answer questions on grounds they were irrelevant and “beyond the
scope of discovery.” On numerous times the trial court overruled Pendragon’s objections and
also ruled that certain areas of inquiry were discoverable and instructed Massey to answer.
On that same day, June 12, 2013, the trial court sua sponte appointed a special master for
the limited purpose of attending future depositions to make “rulings on objections, assertions of
privilege, and instructions not to answer questions.” In its order, which set out many of the facts
recounted above, the court stated that Pendragon’s counsel did not have legitimate grounds for
instructing the witness not to answer questions. The court also indicated the attorney’s “form”
objections were “wholly without merit.” The court stated that it was apparent Pendragon’s
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counsel was “improperly trying to limit the flow of information at the deposition.” The court
further stated that “it appears manifest that all depositions in this case must be attended by a
judicial officer who can make rulings at the depositions, or else the depositions will simply decay
into chaos and not be able to proceed.” The trial judge stated he could not be physically present
at every deposition in this case. The court found that this was an exceptional case and that good
cause existed to appoint a special master to attend the depositions.
On August 20, 2013, Pendragon filed a written objection to the appointment of the
master. At a hearing on the objection on September 18, 2013, the trial court denied the
objection. On December 27, 2013, just eleven days before trial, Pendragon filed its petition for
writ of mandamus in this Court. (The trial has since been rescheduled for the end of May 2014.)
In its petition for writ of mandamus, Pendragon challenges the trial court’s appointment
of a special master. The appointment of special masters is governed by rule 171 of the Texas
Rules of Civil Procedure. Rule 171 provides that the court may, in exceptional cases, for good
cause appoint a master in chancery who shall perform all the duties required of him by the court.
TEX. R. CIV. P. 171. A trial court abuses its discretion when it appoints a master without the
parties’ consent or without finding that the case is exceptional and good cause exists for the
appointment. Simpson v. Canales, 806 S.W.2d 802, 811 (Tex. 1991) (orig. proceeding).
Pendragon asserts that this is not an exceptional case and that there is not good cause for
appointing a master.
A writ of mandamus issues to correct a clear abuse of discretion when no adequate
remedy by appeal exists. Walker v. Packer, 827 S.W.2d 833, 839-40 (Tex. 1992) (orig.
proceeding). Mandamus is an extraordinary remedy, not issued as a matter of right, but at the
discretion of the court. Rivercenter Assocs. v. Rivera, 858 S.W.2d 366, 367 (Tex. 1993) (orig.
proceeding). Although mandamus is not an equitable remedy, its issuance is largely controlled
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by equitable principles. Id. One such principle is that “equity aids the diligent and not those
who slumber on their rights.” Id. Thus, delaying the filing of a petition for mandamus relief
may waive the right to mandamus unless the relator can justify the delay. In re Int’l Profit
Assocs., Inc., 274 S.W.3d 672, 676 (Tex. 2009) (orig. proceeding).
Pendragon filed its petition for writ of mandamus more than six months after the trial
court appointed the special master. It waited over two months to ask the trial court to reconsider
its order appointing the master and, after the trial court upheld its order, still waited another
three-and-a-half months to file its petition with this Court. Significantly, Pendragon filed its
petition less than two weeks before trial, a fact it omitted in its request for mandamus relief. It
has offered no justification for its delay. Under these circumstances, we conclude Pendragon’s
delay bars its right to complain of the master’s appointment. See Rivercenter, 858 S.W.2d at 367
(mandamus relief denied where relator waited over four months to seek mandamus without
justification); Int’l Awards, Inc. v. Medina, 900 S.W.2d 934, 936 (Tex. App.—Amarillo 1995,
orig. proceeding) (delay of four months and until eve of trial was ample grounds for denying
mandamus relief); Bailey v. Baker, 696 S.W.2d 255, 256 (Tex. App.—Houston [14th Dist.]
1985, orig. proceeding) (denying leave to file petition for writ of mandamus where there was
almost four-month delay, no explanation for delay, and relator waited two weeks prior to trial). 1
Pendragon also challenges that portion of the trial court’s order requiring it to pay the
master’s fees before they accrued. The court’s order states the following regarding the master’s
fees:
1
Because we have determined that Pendragon may not complain about the appointment of the special master, we do not reach the issue of
whether it was proper for the trial court to appoint a special master to attend and rule on objections during depositions. We do note, however, the
“exceptional case” standard for appointment of a special master is an extremely high one. See, e.g., Simpson, 806 S.W.2d at 812 (toxic tort action
against eighteen defendants, several cross-actions, and eight discovery motions requiring hearings in first ten months was not an exceptional case
and thus, no good cause existed for appointing special master to oversee discovery); In re Behringer Harvard TIC Mgmt. Servs. LP, 316 S.W.3d
831, 831 (Tex. App.—Dallas 2010, orig. proceeding) (court abused its discretion in appointing master to conduct in camera review of certain
documents because of trial schedule and complexities of discovery in case); Owens-Corning Fiberglas Corp. v. Caldwell, 830 S.W.2d 622, 626-
27 (Tex. App.—Houston [1st Dist.] 1991, orig. proceeding) (case involving five defendants, seven requests for production, one set of
interrogatories served on all defendants, and two motions to compel requiring two hearings was not exceptional).
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The Master in Chancery’s reasonable and necessary fees (not to exceed the rate of
$225.00 per hour) shall be taxed as costs of court. As an initial matter, Plaintiff
shall be responsible for paying the Master in Chancery’s fees as they are incurred
(payable in the form of retainers in an amount of no less than $1,000.00, at least 3
days in advance before each deposition), subject to reallocation at a later date,
depending on, inter alia, who is the prevailing party in the suit.
The only basis for requiring a party to give security for costs before final judgment is
Texas Rule of Civil Procedure 143. TransAmerican Natural Gas Corp. v. Mancias, 877 S.W.2d
840, 844 (Tex. App.—Corpus Christi 1994, orig. proceeding [leave denied]). Rule 143 provides
that a party seeking affirmative relief may be ruled to give security for costs at any time before
final judgment, upon motion of any party, or any officer of the court interested in the costs
accruing in such suit, or by the court upon its own motion. TEX. R. CIV. P. 143. Rule 143 does
not authorize the court to fix bond in a specific amount; it must be open-ended. Dilmore v.
Russell, 519 S.W.2d 278, 279 (Tex. Civ. App.—Dallas 1975, no writ); Mosher v. Tunnell, 400
S.W.2d 402, 404 (Tex. Civ. App.—Houston 1966, writ ref’d n.r.e.); see also TEX. R. CIV. P. 146
(court can also require deposit for court costs but only in amount sufficient to pay accrued costs).
Requiring a party to pay for a master’s services before the master’s fees have actually accrued is
an abuse of discretion because it improperly requires a party to post security for anticipated costs
before final judgment in violation of rule 143. TransAmerican, 877 S.W.2d at 844. Here, we
conclude the trial court’s order requiring the master’s fees to be paid in advance was a clear
abuse of discretion for which there is no adequate remedy by appeal. See id. Because the trial
court’s order regarding fees was clearly in direct contravention of the rules of civil procedure,
Pendragon’s delay in filing its petition does not bar its right to relief on this issue.
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In accordance with this opinion, we conditionally grant Pendragon’s writ of mandamus in
part. A writ will issue only in the event the trial court fails to vacate the portion of its June 12,
2013 order requiring Pendragon to pay the special master’s fees before they accrue. We deny
Pendragon’s writ of mandamus in all other respects.
/Ada Brown/
ADA BROWN
JUSTICE
131749F.P05