in Re 2500 West Loop, Inc. ( 2018 )

Petition for Writ of Mandamus Denied in Part and Conditionally Granted in
Part and Memorandum Opinion filed September 21, 2018.
In The
Fourteenth Court of Appeals
NO. 14-18-00770-CV
IN RE 2500 WEST LOOP, INC., Relator
ORIGINAL PROCEEDING
WRIT OF MANDAMUS
333rd District Court
Harris County, Texas
Trial Court Cause No. 2017-50232
MEMORANDUM OPINION
On September 4, 2018, relator 2500 West Loop, Inc., filed a petition for writ
of mandamus in this court. See Tex. Gov’t Code Ann. § 22.221 (West Supp. 2017);
see also Tex. R. App. P. 52. In the petition, relator asks this court to compel the
Honorable Robert Schaffer, ancillary court judge of Harris County, to modify a
temporary restraining order (TRO) to permit relator to pursue any rights or remedies
in a federal court proceeding. On September 14, 2018, relator filed a supplemental
petition for writ of mandamus in which relator asks this court to compel the
Honorable Daryl L. Moore, presiding judge of the 333rd District Court, to vacate a
TRO signed September 13, 2018.
BACKGROUND
On August 16, 2018, the ancillary court judge, Judge R.K. Sandill, entered an
order restraining Jetall Companies, Inc., Ali Choudhri, Bradley S. Parker, and 2500
West Loop, Inc. (collectively, “Defendants”) from directly or indirectly:
1. foreclosing, or attempting to foreclose on the Building, the
Promissory Note (the “Note”) executed by Mokaram-Latif West Loop,
Ltd., originally payable to the order of Capital One, National
Association, assigned by Original Lender to 2500 West Loop, Inc.,
LLC, a Delaware limited liability company, evidencing a loan in the
original principal amount of $6,000,000, secured by the lien and
provisions of a Deed of Trust of even date thereto to Sally Bring,
Trustee, and personally guaranteed by Osama Abdullatif, as amended
and modified.
2. conducting a Substitute Trustee Sale or any other sale or transfer
in any way related to the Building, the Note.
Following the issuance of the August 16, 2018 order, and before a hearing
could be held on the temporary injunction, relator removed the case to federal court
and filed a motion to recuse Judge Sandill.
On August 30, 2018, the date that the August 16, 2008 order expired according
to its terms, Judge Schaeffer, acting as the ancillary court judge, entered a TRO–the
subject of relator’s original petition for writ of mandamus–in which relator and other
defendants were restrained from:
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(i) Foreclosing, exercising any power of sale with respect to, or
attempting to foreclose on any liens on the Real Property and the
Building;
(ii) Foreclosing, exercising the power of sale or attempting to foreclose,
or possessing any property, cash, accounts, or other assets, tangible or
intangible, of ML Partnership;
(iii) Foreclosing, exercising the power of sale or attempting to
foreclose, or taking possession of the Building or any books, records or
accounts owned, leases, property management contracts, construction
contracts, engineering/architectural contracts, plans and specifications
with respect to the Real Property and building controlled or used by ML
Partnership;
(iv) Appointing a receiver without notice to ML Partnership and the
authorization of this court;
(v) Requiring ML Partnership to surrender insurance policies;
(vi) Foreclosing any liens on leases and/or rents derived from the Real
Property;
(vii) Foreclosing any liens on any personal property located at the Real
Property and any personal property of ML Partnership at any other
location;
(viii) Exercising any rights under an assignment of rents derived from
the Real Property;
(ix) Exercising any ownership or control over either (i) the rents derived
from the Real Property, or (ii) the proceeds of that rent;
(x) Exercising any right of offset or recoupment of money owned by,
or in the name of, Plaintiff;
(xi) Interfering with Plaintiffs right to quiet enjoyment of the Real
Property;
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(xii) Entering upon the Real Property to take possession of, assemble,
receive, and collect any personal property;
(xiii) Participating in, providing assistance with or conducting a
Substitute Trustee Sale or any other sale or transfer in any way related
to the Building, the Loan or the Note;
(xiv) Notifying any tenants or lessees of any space within the Real
Property to pay their rents to anyone other than Plaintiff and accepting
lease and/or rental payments from the Building's tenants or lessees. All
rental and/or lease payments from the Building's tenants should be paid
to the Special Master at such location as he may direct; and
(xv) selling, conveying or otherwise transferring the Loan.
After the initial temporary injunction hearing on September 12, 2018, Judge
Daryl Moore extended the August 30, 2018 TRO for another 14 days.
In its initial petition for writ of mandamus relator complained that Judge
Schaeffer exceeded his authority in issuing the TRO signed August 30, 2018. The
order states that it was in effect until the court’s hearing on the temporary injunction
scheduled September 11, 2018. Judge Moore began the temporary injunction hearing
September 12, 2018, but did not complete the hearing that day. To facilitate
completion of the hearing and review of the parties’ requests, Judge Moore signed
an order on September 13, 2018, extending the TRO another 14 days.
On September 14, 2018, relator filed a supplemental petition for writ of
mandamus in which it argues that the order signed September 13, 2018 should be
vacated because the order violates Texas Rule of Civil Procedure 680.
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ANALYSIS
To obtain mandamus relief, relator must show that the trial court clearly
abused its discretion and that relator has no adequate remedy by appeal. In re
Southwestern Bell Tel. Co., L.P., 226 S.W.3d 400, 403 (Tex. 2007) (orig.
proceeding) (citing In re Prudential Ins. Co. of Am., 148 S.W.3d 124, 135–36 (Tex.
2004) (orig. proceeding)). Relator contends that Judge Moore abused his discretion
by granting the second extension of the TRO in violation of Texas Rule of Civil
Procedure 680. Rule 680 provides in relevant part:
[E]very temporary restraining order granted without notice ... shall
expire by its terms within such time after signing, not to exceed fourteen
days, as the court fixes, unless within the time so fixed the order, for
good cause shown, is extended for a like period or unless the party
against whom the order is directed consents that it may be extended for
a longer period. The reasons for the extension shall be entered of record.
No more than one extension may be granted unless subsequent
extensions are unopposed.
Id. The Texas Supreme Court has held that “Rule 680 governs an extension of a
temporary restraining order, whether issued with or without notice, and permits but
one extension for no longer than fourteen days unless the restrained party agrees to
a longer extension.” In re Texas Natural Res. Conservation Comm’n, 85 S.W.3d
201, 204–05 (Tex. 2002) (orig. proceeding). The short duration allowed by Rule 680
is “a critical safeguard against the harm occasioned by a restraint on conduct that
has yet to be subject to a truly adversarial proceeding.” Id. at 206–07. Mandamus is
available for temporary restraining orders that violate the time limitations of Rule
680. Id. at 207.
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Real party in interest, Mokaram-Latif West Loop, Ltd, filed a response to
relator’s supplemental petition in which it argued that the trial court did not violate
Rule 680. Real party argues that although there are three orders in this case, Judge
Moore’s September 13, 2018 order was not a second extension of the first order
signed August 16, 2018.
The parties agree that the September 13, 2018 order extends the August 30,
2018 order. Real party argues that the August 30, 2018 order was a completely new
TRO and did not extend the August 16, 2018 order; therefore, the September 13,
2018 order was not a second extension of the August 16, 2018, but a permissible
first extension of the August 30, 2018 order. The August 30, 2018 TRO does not, on
its face, purport to extend the August 16, 2018 order, though it was issued on the
date that the August 16, 2018 order would expire. However, the restraint, although
broader in the August 30, 2018 order, essentially has the same effect on relator. The
supreme court has said, “if a party can obtain unlimited extensions of a temporary
restraining order, there would be no reason to ever seek a temporary injunction,
which has more stringent proof requirements.” In re Texas Nat. Res. Conservation
Com’n, 85 S.W.3d at 204.
Although the August 30, 2018 does not contain specific language extending
the August 16, 2018 order, its effect on the parties is the same. The supreme court
has interpreted the requirements of Rule 680 in such a way as to not permit a party
to continually request temporary restraining orders without requiring the party to
meet the more stringent requirements of obtaining a temporary injunction. The
September 13, 2018 order extending the TRO for a second time does not comply
with the requirements of Rule 680. Issuance of that order was an abuse of the trial
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court’s discretion. See id. at 204–05. Further, relator has no adequate appellate
remedy because TROs are generally not appealable. See In re Office of Attorney
Gen., 257 S.W.3d 695, 698 (Tex. 2008) (orig. proceeding). As such, we
conditionally grant relator’s supplemental petition for writ of mandamus. See Tex.
R. App. P. 52.8(c).
With regard to relator’s initial petition for writ of mandamus filed against
Judge Schaeffer regarding the August 30, 2018, we deny mandamus relief.
CONCLUSION
We conditionally grant mandamus against Judge Daryl Moore, presiding
judge of the 333rd District Court. We are confident that Judge Moore will vacate the
September 13, 2018 order extending the temporary restraining order. The writ will
issue only if Judge Moore fails to vacate the order. All other relief requested by
relator is denied.
PER CURIAM
Panel consists of Justices Christopher, Jamison, and Brown.
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