Chana Horowitz v. Francis Berger ( 2012 )

Reversed and Remanded and Majority and Concurring Opinions filed June 21,
2012.
In The
Fourteenth Court of Appeals
___________________
NO. 14-11-00576-CV
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CHANA HOROWITZ, Appellant
V.
FRANCISC BERGER; TIBERIU ROMAN; SARA BERGMAN; PINCHAS
BERGMAN; ALEXANDER DAVIDOVICH; INNA DAVIDOVICH; ARON
EHERENTREW; RONNIE EILAM; YITSHAK ELIYAHU; REVITAL
ELIYAHU; ARNON EREZ; NETANEL FEIGER; NOAM FISHMAN; HADAS
FISHMAN; FRANK FREEDLAND; GISA FREEDLAND; ISRAEL FREEDLAND;
RIVKA FREEDLAND; SHMUEL FREEDLAND; TZIPORA FAIGE; TOVA
SHNITMAN; NAFTALI FRIEDLANDER; MICHAEL GITIK; DANIEL
GLINERT; D. GLINERT HOLDINGS, LTD.; SAGI GOLDBERG; MOSHE
GOTLIB; YURAY GROSS; EVA GROSS; ARIE GUTTMAN; TZIPORA
HELLMANM; HENRY KALB; MIRIAM RASKIN KIRYATI; BRURIA KLEIN;
AVRAHAM KRAKOVER; SHULAMIT KRAKOVER; AHARON LAHER; SARA
SHTERNA-LANDO; NIDA LAOHACHAI; MOSHE LAVI; MALKA LAVI;
AMIR LEVI; SANDRA LEVI; RIVKA LIKVORNIK; ADINA MASTBAUM;
MENAHEM NAGAR; GAVRIEL NESGI; NAHUM OLSCHWANG; MISHEL
HAIM PAPISMEDOV; MOSHE PELEG; YOSSEF POTASH; YAAKOV
RABINOVITS; AVRAHAM RAIZMAN; HADASA RAIZMAN; ELAD REGEV;
BIEN SHAI; LIRON RUKACH; SHLOMIT SHAKED; IRIS SHANY; ELIEZER
SPUND; MOSHE SPUND; YADIN TEREM; TZACHI NAIM; NIR VENTURA;
DAN WILLNER; DGANIT WILLNER; ARIE CHAIM YOFFE; GAD ZEITLIN;
RACHEL ZEITLINM; EZRA KAIM; DAN SCHWARZ; AND ZAHAVA
SCHWARZ, Appellees
On Appeal from the 122nd District Court
Galveston County, Texas
Trial Court Cause No. 09CV0242
CONCURRING OPINION
The interests of litigants are best served when courts adopt and utilize measures
that foster and enhance judicial economy. The Supreme Court of Texas has recognized
the importance of taking this approach and has adopted such measures in summary
judgment appeals, holding that appellate courts reviewing summary judgments may
consider all summary-judgment grounds presented to the trial court, including grounds
that the trial court rejected as a basis for its summary judgment. See Cincinnati Life Ins.
Co. v. Cates, 927 S.W.2d 623, 627 (Tex. 1996). This well-reasoned approach enables
appellate courts to dispose of cases on grounds fully vetted in the trial court even when
the trial court did not base its ruling on those grounds. Today, this court should follow
the high court’s lead and hold that procedures analogous to those announced in
Cincinnati Life Ins. Co. v. Cates apply in the review of a trial court’s ruling on a special
appearance.
The appellees/plaintiffs in today’s case urged the trial court to deny the
appellant/defendant Chana Horowitz’s special appearance on multiple grounds that
included waiver and the existence of minimum contacts justifying the exercise of
personal jurisdiction based upon specific jurisdiction. The trial court denied the special
appearance, basing its ruling only upon the specific-jurisdiction theory. Noting that the
trial court did not base its ruling upon the waiver arguments, Horowitz, in her opening
appellate brief, did not present any argument challenging the waiver grounds asserted in
the trial court. Curiously, the majority analyzes the waiver arguments, rejects them, and
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then concludes that Horowitz did not need to challenge them in her appellate briefing
because the trial court did not base its ruling on waiver. The majority never explains this
unusual approach nor reveals why this court addresses the waiver arguments given that
the trial court’s ruling was not based upon waiver and that Horowitz did not have to
challenge these arguments on appeal. Though the majority’s waiver analysis in this case
seems to be without purpose, such an analysis could serve a useful function and also
further the worthy goals of judicial economy in this type of appeal.
Today, this court should conclude that, on appeal from an order denying a special
appearance, while an appellate court must consider whether the trial court erred in
denying appellant’s special appearance on the grounds that the trial court made the basis
of its ruling, in the interests of judicial economy, the reviewing court may also consider
the merits of waiver arguments advanced by the appellees but not adopted by the trial
court.
This court should hold that procedures analogous to those announced in Cincinnati
Life Ins. Co. v. Cates apply in appeals from a trial court’s ruling on a special
appearance.
In response to Horowitz’s special appearance, appellees/plaintiffs asserted that
Horowitz had waived her special appearance by taking various actions. The majority
correctly concludes that because the trial court rejected these waiver arguments in
denying the special appearance, Horowitz was not required to attack them on appeal.
But, the majority does not address whether or how this court could affirm the trial court’s
order based upon the waiver arguments. In keeping with our high court’s commitment to
enhancing judicial economy and the sound approach adopted in Cincinnati Life Ins. Co.
v. Cates for summary-judgment appeals, this court should hold that parallel procedures
apply in the special-appearance context.
In Cates, the Supreme Court of Texas held that, in reviewing a summary
judgment, appellate courts should consider all summary-judgment grounds on which the
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trial court ruled and the movant preserved error that are necessary for final disposition of
the appeal. See Cincinnati Life Ins. Co. v. Cates, 927 S.W.2d 623, 627 (Tex. 1996). In
addition, the high court held that, in the interest of judicial economy, appellate courts
may consider other grounds that the movant preserved for appellate review and the trial
court did not make a basis of its summary judgment. See id. Today, this court should
implement this procedure and hold that, in reviewing a denial of a special appearance to
determine whether the trial court erred in overruling the jurisdictional challenges, the
reviewing court, in the interest of judicial economy, may consider waiver arguments that
were presented to the trial court but not made a basis of the trial court’s ruling on the
special appearance. See id. Under this procedure, if the trial court could not exercise
personal jurisdiction over the defendant under either general or specific jurisdiction, the
appellate court, in the interest of justice, could consider the preserved waiver arguments,
even though the trial court rejected these arguments. This would mean that even though
an appellant like Horowitz is not required to attack the waiver arguments in her opening
appellate brief, the reviewing court could consider the waiver grounds as a possible basis
for affirming the trial court’s order. See id. This approach would allow appellate courts
the greatest opportunity to review all special-appearance grounds presented, examined,
and preserved in the trial court and thereby dispose of time-sensitive special-appearance
appeals in a manner that maximizes efficiency.
The majority defines “contact with Texas” in a narrow manner that conflicts with
controlling precedent.
Though this court reaches the correct result in this appeal, the majority’s specific-
jurisdiction analysis is flawed. In several parts of its opinion, the majority states that
various actions in Israel regarding land known to be in Texas do not constitute contacts
with Texas. These conclusions conflict with the broad construction that the United States
Supreme Court, the Supreme Court of Texas, and this court have given as to what a
“contact with the forum state” is for purposes of a personal-jurisdiction analysis. See
Burger King Corp. v. Rudzewicz, 471 U.S. 462, 476, 105 S. Ct. 2174, 2184, 85 L. Ed. 2d
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528 (1985) (“So long as a commercial actor’s efforts are ‘purposefully directed’ toward
residents of another state, we have consistently rejected the notion that an absence of
physical contacts can defeat personal jurisdiction there.”); Retamco Operating, Inc. v.
Republic Drilling Co., 278 S.W.3d 333, 337–40 (Tex. 2009) (holding that a defendant’s
acceptance in California of an assignment of oil and gas leases was a contact with Texas
for personal-jurisdiction purposes because the assignment was of real property interests
located in Texas, even though the defendant never physically entered Texas); Alenia
Spazio, S.p.A. v. Reid, 130 S.W.3d 201, 212 (Tex. App.—Houston [14th Dist.] 2003, pet.
denied) (considering a wide variety of alleged connections between the defendant and
Texas to be “contacts with Texas,” even if these contacts did not involve conduct by the
defendant in Texas). Even though the majority correctly concludes that Horowitz’s
contacts with Texas do not justify the exercise of specific jurisdiction in this case, the
majority’s characterization of the contacts is incongruent with binding precedent.
The majority concludes that none of the following constitute a contact with Texas
for the purposes of a personal-jurisdiction analysis:
(1) being in the business of recruiting investors in Israel to invest in real
estate in Texas,
(2) taking purposeful action with the goal of recruiting Israeli
investors to purchase real property in Texas,
(3) being a principal salesperson at T-M Real Estate and Investments,
Ltd. selling Texas real property to people in Israel,
(4) being instrumental in causing sale documents to be executed by
people in which they purchase real property in Texas,
(5) profiting monetarily from the sale of real property located in Texas,
(6) being an instrumental “but for” cause of the people executing
documents necessary to purchase real property in Texas,
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(7) being the principal sales and marketing agent who got certain people
to execute English language agreements under which they
purchased land in Texas, and
(8) telling certain people in Israel of a visit to real property in Texas
in an effort to bolster one’s credibility in selling Texas real property
to people in Israel.
See ante at pp. 13–15. Some of these purported contacts may not be supported by the
evidence before the trial court, and some of these contacts may not be high-quality
contacts with Texas. But that does not mean they are not contacts with Texas.
The evidence before the trial court shows that Horowitz did not have sufficient
contacts with Texas to support the exercise of personal jurisdiction because Horowitz is a
citizen and resident of Israel who did not purposefully avail herself of the privilege of
conducting activities within Texas, thus invoking the benefits and protections of its laws.
See Michiana Easy Livin’ Country, Inc. v. Holten, 168 S.W.3d 777, 784 (Tex. 2005).
Nonetheless, contrary to the majority’s analysis, the above-mentioned contacts are
“contacts with Texas.” See Burger King Corp., 471 U.S. at 476, 105 S. Ct. at 2184;
Retamco Operating, Inc., 278 S.W.3d at 337–40; Alenia Spazio, S.p.A., 130 S.W.3d at
212.
Conclusion
Under the applicable standard of review, because the evidence before the trial
court negated both specific and general jurisdiction, the trial court erred in finding that it
could exercise personal jurisdiction over Horowitz.1 Though the trial court rejected
appellees’ waiver arguments, this court nevertheless would have good reason to address
these arguments if this court were to adopt procedures akin to those announced by the
1
Nonetheless, in reaching this conclusion, the majority erroneously concludes that various alleged
connections between Horowitz and Texas are not “contacts with Texas.” See ante at pp. 13–15.
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Supreme Court of Texas in Cates.2 This approach not only would bring meaning and
purpose to today’s waiver analysis but also would advance important principles of
judicial economy and lay the groundwork for application of the Cates rule in future
special-appearance cases.
/s/ Kem Thompson Frost
Justice
Panel consists of Justices Frost, Brown, and Christopher. (Christopher, J., majority).
2
The Supreme Court of Texas has not yet addressed whether engaging in discovery regarding the merits
of a plaintiff’s claims constitutes a waiver of a defendant’s special appearance and today’s opinion
appears to be the first time that the Fourteenth Court of Appeals has addressed this issue. Though the
majority correctly concludes that this conduct does not waive a special appearance, the majority fails to
cite language from Rule 120a and cases from sister courts that support this conclusion. See, e.g., Tex. R.
Civ. P. 120a (stating that “the issuance of process for witnesses, the taking of depositions, the serving of
requests for admissions, and the use of discovery processes, shall not constitute a waiver of such special
appearance” and containing no limitation of this language to jurisdictional issues); Silbaugh v. Ramirez,
126 S.W.3d 88, 93 (Tex. App.—Houston [1st Dist.] 2002, no pet.) (holding that defendant does not waive
special appearance by engaging in discovery regarding merits of plaintiff’s claims); Minucci v.
Sogevalor, S.A., 14 S.W.3d 790, 799–801 (Tex. App.—Houston [1st Dist.] 2000, no pet.) (same as
Silbaugh).
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