Jack W. Thompson v. David Ricardo and Kara K. Peak ( 2008 )

Dismissed as Moot and Majority and Dissenting Opinions filed August 26, 2008

Dismissed as Moot and Majority and Dissenting Opinions filed August 26, 2008.

In The

Fourteenth Court of Appeals

____________

NO. 14-07-00333-CV

____________

JACK W. THOMPSON, Appellant

V.

DAVID RICARDO & KARA K. PEAK, Appellees

On Appeal from the 164th District Court

Harris County, Texas

Trial Court Cause No. 2005-56772

M A J O R I T Y   O P I N I O N

Attorney Jack W. Thompson represented Niki Koestens in a legal proceeding to have property declared her homestead under Article XVI, section 50 of the Texas Constitution and section 41.001 of the Texas Property Code.   Appellees David Ricardo and Kara K. Peak filed a motion for sanctions under Rule 13 of the Texas Rules of Civil Procedure, (1) alleging that Thompson filed a groundless pleading and (2) requesting that the trial court hold Koestens and Thompson jointly and severally liable for attorney=s fees, for the amounts due on the notes payable on two deeds of trust granted on the Property, and for punitive damages.  The trial court granted the motion for sanctions, but instead of imposing a monetary sanction on Thompson, the court ordered him to Atake all actions necessary to release any and all liens on the Property on or before January 31, 2007.@  Thompson then brought this appeal.

Factual and Procedural Background

According to the parties= pleadings, Ricardo was the plaintiff in a prior lawsuit against Koestens and her business, Niki=s Auto Shop & Repair.  On March 31, 2005, Ricardo obtained an agreed judgment against Koestens and her business in the amount of $64,320.00.  Constable Jack W. Abercia subsequently levied on a parcel of real property owned by Koestens (Athe Property@), which was thereafter sold at a Constable=s sale to Peak.

Nearly two months later, Koestens filed a declaratory judgment action against appellees and Constable Abercia, seeking to have the Property declared her homestead under Article XVI, section 50 of the Texas Constitution and section 41.001 of the Texas Property Code.  In addition, Koestens sought to have the Constable=s sale set aside and the Constable=s Deed declared a nullity, and requested injunctive relief to prevent appellees from evicting her from the Property. Koestens further sought to recover damages from appellees for Aabuse of process, negligent and intentional infliction of emotional distress, conversion, common law tortious collection practices, and constructive fraud,@ as well as punitive damages and attorney=s fees.  Thompson represented Koestens in both the prior lawsuit and in the declaratory judgment action.

Appellees thereafter filed a motion for sanctions against Koestens and Thompson under Rule 13 of the Texas Rules of Civil Procedure. Appellees alleged that Koestens=s answers to an oral deposition in the prior lawsuit directly contradicted statements contained in the petition filed in the declaratory judgment action and contradicted her affidavit filed in response to appellees= motion for summary judgment.  Appellees argued that Koestens=s prior deposition testimony supported only the conclusion that she had abandoned the Property, and that her declaratory judgment action was therefore groundless.  Appellees further alleged that Thompson was present and participated in this deposition, that he was aware of the facts stated in the deposition, and that he therefore knew (1) Koestens=s pleading in the declaratory judgment action was groundless when it was filed; and (2) the facts contained in Koestens=s sworn affidavit were false when it was filed.  Appellees requested that the trial court hold Koestens and Thompson jointly and severally liable for attorney=s fees, the amounts due on the notes payable on two deeds of trust that had been granted on the Property,^[1] and punitive damages.

Koestens later nonsuited her declaratory judgment action. The trial court subsequently conducted a hearing on appellees= motion for sanctions, and ultimately granted the motion.  However, instead of imposing the specific sanctions requested by appellees, the trial court ordered Koestens to pay Ricardo $15,000 no later than January 31, 2007.  The trial court further ordered Koestens and Thompson to Atake all actions necessary to release any and all liens on the Property on or before January 31, 2007.@  Only Thompson appealed.

Issues on Appeal

In six issues, Thompson contends that the trial court erred in granting appellees= motion for sanctions.  Essentially, Thompson complains that the trial court failed to comply with the requisites of Rule 13 of the Texas Rules of Civil Procedure, because the trial court (1) sanctioned him while finding that the underlying suit was not groundless; (2) sanctioned him in such vague and ambiguous terms that its order is unenforceable and void; (3) failed to state good cause for sanctions in its order; and (4) failed to identify specific acts or omissions which served as the basis for sanctions in its order.  Thompson further contends that, at the hearing on appellees= motion for sanctions, the trial court refused him the opportunity to testify or otherwise address the court on his own behalf, and that this refusal constitutes a denial of due process. Finally, Thompson asserts that, because the record does not support a finding of Aconscious doing of wrong,@ or support a finding that he Atook actions for the purposes of annoying, threatening, or verbally abusing@ appellees, the trial court erred in finding that he acted in bad faith and for the purposes of harassment.

In contrast, appellees assert, among other things, that Thompson=s appeal is moot. Specifically, appellees argue that, because Thompson has fully complied with the sanctions order entered by the trial court, Athe action [he] was trying to prevent from happening has already happened.@  We agree with appellees that Thompson has completed the actions specified in the trial court=s order, and that his appeal is moot.  Accordingly, without reference to the merits, we vacate that portion of the trial court=s order requiring Thompson to Atake all actions necessary to release any and all liens on the Property on or before January 31, 2007,@ and we dismiss the motion for sanctions as to Thompson.

Analysis

A.      The Mootness Doctrine

Neither the Texas Constitution nor the Texas Legislature has vested this Court with the authority to render advisory opinions. See Tex. Const. art. II, _ 1; see also Camarena v. Tex. Employment Comm=n, 754 S.W.2d 149, 151 (Tex. 1988).  The mootness doctrine limits courts to deciding cases in which an actual controversy exists between the parties.  Fed. Deposit Ins. Corp. v. Nueces County, 886 S.W.2d 766, 767 (Tex. 1994).  When there ceases to be a controversy between the litigating parties due to events occurring after the trial court has rendered judgment, the decision of an appellate court would be a mere academic exercise, and the court may not decide the appeal. See Olson v. Comm=n for Lawyer Discipline, 901 S.W.2d 520, 522 (Tex. App.CEl Paso 1995, no writ).  Stated differently, if a judgment cannot have a practical effect on an existing controversy, the case is moot. Id.  In that situation, the appellate court is required to vacate the judgment of the trial court, and dismiss the underlying cause of action. See Speer v. Presbyterian Children=s Home & Serv. Agency, 847 S.W.2d 227, 228 (Tex. 1993); see also Gen. Land Office v. OXY U.S.A., Inc., 789 S.W.2d 569, 570 (Tex. 1990) (stating that if no controversy continues to exist between the parties, the appeal is moot and the court of appeal must dismiss the cause); Guajardo v. Alamo Lumber Co., 159 Tex. 225, 317 S.W.2d 725, 726 (1958) (explaining that when a case becomes moot on appeal, all previous orders are set aside by the appellate court and the case is dismissed).^[2]

This Court has previously held that a party=s completion of the actions specified in a trial court=s sanctions order renders his appeal of that sanctions order moot. See Barrera v. State, 130 S.W.3d 253, 260 (Tex. App.CHouston [14th Dist.] 2004, no pet) (citing Highland Church of Christ v. Powell, 640 S.W.2d 235, 235 (Tex. 1982)). Therefore, we will examine whether Thompson has completed the actions specified in the trial court=s order, thereby rendering his appeal of this issue moot.

B.      Thompson Has Completed The Actions Specified In The Trial Court=s Order

From our review of the record, it is evident that Thompson has completed the actions specified in the trial court=s order.  As noted above, the trial court ordered Thompson to Atake all actions necessary to release any and all liens on the Property on or before January 31, 2007.@  There were two liens on the PropertyCone in the amount of $15,000, and a second in the amount of $10,000Cboth granted to Kubosh Bail Bonds, and a notice of lis pendens filed by Koestens.  Thompson himself prepared releases for both liens and for the notice of lis pendens;^[3] the release for the notice of lis pendens was executed by Koestens on December 28, 2006, and the release for the $15,000 lien was executed by Paul A. Kubosh, on behalf of Kubosh Bail Bonds, on January 23, 2007.  And, on February 1, 2007, Thompson submitted to the Harris County Clerk the releases that had been executed by Koestens and Kubosh, along with the required filing fee.

The record further reveals that Kubosh executed a release for the $10,000 lien on June 15, 2007.^[4] Furthermore, on July 25, 2007, appellees filed in the trial court a ANotice of Sale Of Real Property Subject Of Lawsuit,@ in which they notified the trial court that (1) the Property had been sold to a disinterested third party; and (2) the Property was free from liens at the time of sale. Therefore, because the trial court=s sanctions order required Thompson to take all necessary actions to release any and all liens on the Property, and because the Property was sold to a disinterested third partyCand was free from liens at the time of saleCthe record indicates that Thompson has completed the actions specified in the trial court=s order.  His appeal is therefore moot.  Accordingly, without reference to the merits, we vacate that portion of the trial court=s order requiring Thompson to Atake all actions necessary to release any and all liens on the Property on or before January 31, 2007,@ and we dismiss the motion for sanctions as to Thompson.^[5]

Conclusion

Because we find that Thompson has completed the actions specified in the trial court=s order imposing sanctions under Rule 13, we conclude that his appeal is moot.  Therefore, without reference to the merits, we vacate that portion of the trial court=s order requiring Thompson to Atake all actions necessary to release any and all liens on the Property on or before January 31, 2007,@ and dismiss the motion for sanctions as it relates to Thompson.

/s/      Wanda McKee Fowler

Justice

Judgment rendered and Majority and Dissenting Opinions filed August 26, 2008.

Panel consists of Justices Fowler, Frost, and Seymore. (Frost, J. dissenting)

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^[1]  The record indicates that Koestens granted two deeds of trust on the Property to Kubosh Bail Bonds to secure payment on two notes: one in the amount of $15,000, and a second in the amount of $10,000.

^[2]  The Texas Supreme Court has recognized two exceptions to the mootness doctrine, neither of which apply here: (1) the Acapable of repetition yet evading review exception@; and (2) the Acollateral consequences exception.@ See Gen. Land Office, 789 S.W.2d at 571. The former applies where the challenged act is of such short duration that the appellant cannot obtain review before the issue becomes moot, and has only been used to challenge unconstitutional acts performed by the government. Id.  The latter is invoked only under narrow circumstances, when vacating the underlying judgment will not cure the adverse consequences suffered by the party seeking to appeal that judgment. Marshall v. Hous. Auth. of City of San Antonio, 198 S.W.3d 782, 789 (Tex. 2006).  In order to invoke the collateral consequences exception, Thompson must show (1) a concrete disadvantage resulted from the judgment; and (2) the disadvantage will persist even if the judgment is vacated and the case dismissed as moot. Id.  Thompson does not contend that either exception applies to the present appeal, nor does he attempt to demonstrate (1) a concrete disadvantage resulted from the trial court=s judgment; or (2) he will continue to suffer any adverse consequences if the judgment below is vacated and the cause dismissed as moot.  Therefore, neither exception applies to this appeal.

^[3]  There is additional evidence that Thompson himself took actions to comply with the trial court=s sanctions order.  Apparently, Thompson also authored a letter to Koestens, dated December 26, 2006, in which he (1) explains the practical effect of the trial court=s sanctions order; (2) instructs her to execute the release of the notice of lis pendens, and to have Mr. Kubosh execute the releases of liens; and (3) requests that she Atake care of these matters right away.@  This letter, attached as Exhibit A to appellees= APartial Withdrawal Of Motion For Enforcement Of Orders And Request To Cancel Hearing,@ is present in appellees= brief, but is absent from the Clerk=s Record.  However, in their ARequest To Supplement Record For Appeal,@ filed on July 9, 2007, appellees specifically requested that Exhibit A be included in the record, and Thompson does not challenge the authenticity of the letter included in appellees= brief.

^[4]  The release for the $10,000 lien that was actually executed by Kubosh was prepared by attorney Stephen Best.  It is not apparent on the face of the record why Kubosh did not execute the release prepared by Thompson for this particular lien, and the parties make no attempt to otherwise explain this occurrence in their briefs.

^[5]  Thompson contends that his appeal is not moot, because (1) the trial court=s order on sanctions is still in effect; (2) there has not been a court determination as to the completion of its vague terms; (3) the potential danger posed to him by the order still exists; and (4) the trial court=s order is serving as the underlying basis for a malpractice suit by appellees currently pending.  To the extent that this can be construed as an attempt to invoke the collateral consequences exception to the mootness doctrine, we have  two responses. See Marshall, 198 S.W.3d at 789.  First, we have vacated that portion of the order requiring Thompson to remove the liens and have dismissed the motion for sanctions as to Thompson.  As a result,  nothing remains in the trial court for the appellees or the court to rely on for further contempt proceedings against Thompson. Second, appelleesCthe parties who brought the motion for sanctions in the trial courtCclaim on appeal that the appeal is moot by pointing out that Thompson has complied with the order.  They would be estopped from taking a contrary position below, or for all practical purposes would have problems taking a contrary position below. See Moore v. Jet Stream Invs., Ltd., C S.W.3d C , 2008 WL 3160745, at *12 (Tex. App.CTexarkana Aug. 8, 2008, no pet. h.) (citing Lopez v. Munoz, Hockema & Reed, L.L.P., 22 S.W.3d 857, 864 (Tex. 2000)) (stating that the doctrine of quasi-estoppel precludes a party from asserting, to another=s disadvantage, a right inconsistent with a position previously taken, and explaining that A[t]he doctrine applies when it would be unconscionable to allow a person to maintain a position inconsistent with one to which he or she acquiesced, or from which he or she accepted a benefit.@).