Douglas Ashworth v. Judgment Proof Collection Services, Inc. ( 1993 )

ASHWORTH V. JUDGMENT PROOF IN THE COURT OF APPEALS, THIRD DISTRICT OF TEXAS,

AT AUSTIN









NO. 3-92-557-CV





DOUGLAS ASHWORTH,

APPELLANT

vs.





JUDGMENT PROOF COLLECTION SERVICES, INC.,

APPELLEE

FROM THE DISTRICT COURT OF TRAVIS COUNTY, 201ST JUDICIAL DISTRICT

NO. 475,343, HONORABLE HUME COFER, JUDGE PRESIDING

Douglas Ashworth appeals from the district court's order requiring him to turn over property to the sheriff for execution. The order further commanded the application of the proceeds of the sheriff's sale towards satisfaction of a judgment against Ashworth in this cause that appellee Judgment Proof Collection Services, Inc. ("Judgment Proof"), acquired by assignment from the original plaintiff in this cause, USAA Real Estate Company ("USAA"). Ashworth brings a single point of error on appeal. We will affirm the district court's order.

USAA sued Ashworth for breach of a commercial lease. After a bench trial, the district court rendered judgment in favor of USAA and awarded it $33,207.22 in damages. USAA assigned Judgment Proof the judgment. Judgment Proof then brought an application for turnover relief. The Texas "turnover" statute ⁽¹⁾ is the procedural device by which a judgment creditor may reach assets of a debtor that are otherwise difficult to attach or levy on by ordinary legal process. Beaumont Bank, N.A. v. Buller, 806 S.W.2d 223, 224 (Tex. 1991).

An abstract of the judgment in this cause against Ashworth was contained in Judgment Proof's application. ⁽²⁾ The application also contained a sworn copy of an assignment of this judgment from USAA to Judgment Proof. The application requested that the court order the issuance of a writ of execution commanding the sheriff to seize and conduct a sale of one of Ashworth's assets, a cause of action that Ashworth had asserted against various defendants in district court in Travis County. The application requested turnover of the following property:

Any and all claims, rights to action, rights of enforcement, causes of action or right to recover against the Defendants John Hannah, Jim Gibson, Herbert E. Eilander, 3-G Operating Co. and Integrated Oil & Gas of Houston, Inc. in cause No. 92-11323, Douglas Ashworth v. John Hannah, Jr., Secretary of State of the State of Texas, Jim Gibson, Herbert E. Eilander, 3-G Operating Company, Inc., Integrated Oil & Gas of Houston, Inc., in the 345[th] Judicial District Court, Travis County, Texas.

The application also requested that the court order any proceeds from the judicial sale be applied towards Judgment Proof's judgment against Ashworth. Ashworth did not file any pleading in response to Judgment Proof's application. The turnover statute does not require notice or an opportunity to be heard. Ross v. 3D Tower Ltd., 824 S.W.2d 270, 272 (Tex. App.--Houston [14th Dist.] 1992, writ denied). Nevertheless, a hearing was held and Ashworth's counsel appeared. At the hearing on the turnover application before the district court, Ashworth's counsel repeatedly admitted that Ashworth had filed a cause of action in Travis County as described above. He conceded that Ashworth claimed and owned a cause of action against the named defendants and was seeking recovery from them on his claims. He represented that Ashworth would assign Judgment Proof the asset or a lien thereon. Ashworth's sole argument at this hearing was that the court should impose a lien upon the property instead of seizing it for judicial sale. ⁽³⁾ After hearing argument, the court rendered an order granting Judgment Proof the relief it sought in its turnover application.

Ashworth asserts in his one point of error that no evidence supports the district court's order because no evidence was admitted at the turnover hearing. An appellate court properly reviews a turnover order under an abuse of discretion standard. Buller, 806 S.W.2d at 226; Criswell v. Ginsberg & Foreman, 843 S.W.2d 304, 306 (Tex. App.--Dallas 1992, no writ). A trial court abuses its discretion when it acts in an unreasonable or arbitrary manner, without reference to any guiding rules and principles. Buller, 806 S.W.2d at 226; Downer v. Aquamarine Operators, Inc., 701 S.W.2d 238, 241-42 (Tex. 1985).

Ashworth does not attack the settled proposition that a cause of action is a property right subject to the turnover statute. Criswell, 843 S.W.2d at 306; Associated Ready Mix, Inc. v. Douglas, 843 S.W.2d 758, 762 (Tex. App.--Waco 1992, orig. proceeding); see also Renger Memorial Hosp. v. State, 674 S.W.2d 828, 830 (Tex. App--Austin 1984, no writ). A court may issue a turnover order for a judgment debtor's property if (1) the debtor owns the property; (2) the property cannot readily be attached or levied upon by ordinary legal process; and (3) the property is not exempt from attachment, execution, or seizure for the satisfaction of liabilities. Tex. Civ. Prac. & Rem. Code Ann. § 31.002(a), (a)(1), (a)(2) (West 1986); Criswell, 843 S.W.2d at 306. The district court's order stated that these three requirements had been satisfied. Ashworth admitted at the hearing below that he claimed and owned the subject property and had brought the alleged cause of action in a Travis County district court. Ashworth does not dispute the legal proposition that a cause of action is not readily attachable by ordinary legal process and is not exempt from attachment, execution, or seizure. Commerce Sav. Ass'n v. Welch, 783 S.W.2d 668, 669 (Tex. App.--San Antonio 1989, no writ). His brief contains no argument or authority other than the assertion that no evidence supports the turnover order. We hold that the trial court did not abuse its discretion when it rendered the turnover order. Accordingly, we overrule Ashworth's point of error.

Although Judgment Proof does not raise a cross-point on appeal, it suggests in its argument that Ashworth's appeal in this cause is frivolous and that this Court should award Judgment Proof additional damages as a sanction against Ashworth. We decline to do so. Although we find no merit in Ashworth's argument, we cannot hold that this appeal was taken for delay and without sufficient cause. See Tex. R. App. P. 84; see also Standard Container Corp. v. Dragon Realty, 683 S.W.2d 45, 48 (Tex. App.--Dallas 1984, writ ref'd n.r.e.).

We affirm the turnover order of the district court.

Marilyn Aboussie, Justice

[Before Chief Justice Carroll, Justices Aboussie and Jones]

Affirmed

Filed: August 11, 1993

[Do Not Publish]

1. Tex. Civ. Prac. & Rem. Code Ann. § 31.002 (West 1986 & Supp. 1993).

2. The judgment itself is in the transcript before this Court on appeal.

3. Ashworth does not raise this argument on appeal.