Bill Youngkin v. Billy G. Hines, Jr. , 524 S.W.3d 278 ( 2016 )

IN THE
TENTH COURT OF APPEALS
No. 10-15-00194-CV
BILL YOUNGKIN,
Appellant
v.
BILLY G. HINES, JR.,
Appellee
From the 85th District Court
Brazos County, Texas
Trial Court No. 13-002356-CV-85
OPINION
Appellant Bill Youngkin, an attorney, represented plaintiffs Buetta and Rajena Scott in a
lawsuit that sought to give them ownership of 45 acres that was part of a 285-acre tract in Brazos
County.1 The Scotts alleged that they had paid all of the property taxes on the family-owned land
and that, because the other heirs had not contributed to paying the taxes, the other heirs should lose
their ownership interests. Appellee Billy G. Hines, Jr., one of the defendants in the Scotts’ suit,
asserted that he had paid all or part of the taxes on the 45 acres.
1
We recently decided the appeal of that lawsuit, and our opinion discusses the 285-acre tract’s history. See Capps v.
Foster, No. 10-14-00061-CV, 2016 WL 279022, at *1-2 (Tex. App.—Waco Jan. 21, 2016, pet. denied) (mem. op.).
During trial, the Scotts2 and Hines announced a settlement in open court that was dictated
into the record by Youngkin:
MR. YOUNGKIN: Your Honor, we’ve reached an agreement with Mr.
Sargent’s client Reverend Hines. That agreement - - he is one of the heirs of Alex
Scott, and it will be set forth in the judgment. But what he’s going to do today,
Judge, is we’ve agreed that he’s going to convey his undivided interest in the
surface estate of the 285 acres but he’s going to retain his mineral interests in that
same property.
And I will tell the Court that as part of my client’s intention and agreement
with Mr. Sargent’s client - - there is a portion of this property that was deeded to
the Scott heirs, 45 acres that has - - not a valid description to it but we’re going to
convey by valid description, the undivided one half interest this judgment would
produce so that the Alex Scott heirs would have 100 percent ownership in that 45-
acre tract yet to be surveyed with the property description and provide a copy of
that survey and that deed to Mr. Sargent before it’s filed; and we’ll do all this once
this judgment becomes final, Judge.
Hines then confirmed that agreement on the record in response to questions from his
lawyer:
Q Can you state your name for the record, please?
A Bill Hines.
Q Mr. Hines, did you hear Mr. Youngkin’s – what he recited to the
Judge?
A Yes, I did.
Q Did you understand it?
A Yes, sir.
Q Does that reflect the agreement and understanding that we entered into
back in the jury room?
A Yes, it does.
...
2
The Scotts were not present at trial.
Youngkin v. Hines Page 2
Q And it’s your understanding that you’re conveying only – the surface estate
only in the 285-acre tract?
A Yes.
Q Upon the conclusion of this suit the plaintiffs Mrs. Buetta and Rajena Scott
are going to convey 50 percent of their interest in the Alex Scott survey back to the
heirs of Alex Scott?
A Yes.
Q And at that time you all will own 100 percent of the Alex Scott subject?
A Yes.
THE COURT: All right.
MR. YOUNGKIN: We’ll conclude that with a deed as soon as this is over with,
Judge.
Your Honor, if –
THE COURT: Thank you very much.
Hines’s attorney later drafted a letter agreement to formalize that settlement. The letter
provides:
This letter will serve as confirmation of the recital announced in Court on
December 15, 2010. My client, Billy G. Hines, Jr. will allow his undivided interest
in the original 285.5 acre tract in the J.M. Berrera Survey, Brazos County, Texas to
pass to the Plaintiffs, Buetta and Rajena Scott. In exchange, Billy G. Hines, Jr.’s
interest in the above-referenced property will be retained in the Alex Scott 45 acre
tract of land only (part of 285.5 acre tract). After judgment has been entered, Billy
G. Hines, Jr.’s interest will be reinstated by deed from the Plaintiffs, Buetta and
Rajena Scott in the 45 acre tract set aside exclusively to the Scott heirs.
If this is not your understanding, please contact my office to discuss this
matter. If this letter correctly reflects your understanding, please sign below for
filing with the Court pursuant to Rule 11 of the Texas Rules of Civil Procedure.
The letter agreement was signed by Hines and his attorney and by Youngkin, but not by
the Scotts.
Youngkin v. Hines Page 3
Hines alleges that, after the judgment was signed, (1) the Scotts, with Youngkin’s deed
preparation, conveyed all of their title in the 45 acres to “Curtis Capps, Trustee,” and (2) Hines
conveyed his interest in the surface estate of the 285 acres to the Scotts, but the Scotts could not
perform their part of the settlement agreement of conveying the 45 acres to Hines and to the Alex
Scott heirs because the Scotts had already conveyed the 45 acres to Capps. Capps later executed
a deed to Hines for only Hines’s individual undivided interest in the 45 acres.
Hines then filed suit against the Scotts and Capps, with Hines alleging that the Scotts and
Capps (all originally represented by Youngkin) had defrauded him by failing to comply with the
settlement agreement that had been announced on the record in the earlier case. Hines seeks to set
aside (rescind) the settlement agreement and to cancel the deed that Hines had executed, or in the
alternative, to enforce the settlement agreement and to compel the Scotts and Capps to convey the
45 acres to Hines.3
Hines amended his lawsuit to add Youngkin as a defendant and asserted fraud and
conspiracy claims against Youngkin.4 The second amended petition specifically alleges in
pertinent part:
5. Billy G. Hines, Jr. was induced to enter into an agreement pursuant to
Texas Rule of Procedure 11 purportedly to settle the case filed by Buetta and Rajena
Scott against him and other Defendants. The agreement was never fully
consummated before the filing of this suit. Billy G. Hines revoked his portion of
3
The Scotts and Youngkin generally contend that they complied with the written settlement agreement and that it
trumps the settlement agreement that was dictated into the record. In this appeal, Youngkin frequently asserts that the
letter agreement supersedes the first “oral” agreement, and he raises the parol evidence rule for the first time on appeal
with respect to the allegedly “oral” agreement. Cf. TEX. R. CIV. P. 11 (providing for the enforcement of agreements
“made in open court and entered of record”). We agree with Hines that the parol evidence rule is not properly before
us in this appeal, and we note that the letter agreement does not necessarily supersede the original in-court agreement.
See Fort Worth ISD v. City of Fort Worth, 22 S.W.3d 831, 840 (Tex. 2000) ([It is] “well-established law that
instruments pertaining to the same transaction may be read together to ascertain the parties’ intent, even if the parties
executed the instruments at different times and the instruments do not expressly refer to each other, and that a court
may determine, as a matter of law, that multiple documents comprise a written contract. In appropriate instances,
courts may construe all the documents as if they were part of a single, unified instrument.”) (footnoted citations
omitted).
4
Hines also filed a motion to disqualify Youngkin; the trial court denied that motion.
Youngkin v. Hines Page 4
the agreement and filed this suit due to the failure of the Scott Defendants to provide
consideration and consummate the agreement. Hines asked [sic] the Court for a
recission [sic] and cancellation of the deed he had been induced to deliver. The
Rule 11 Agreement had called for Hines to execute a deed and in return the Scotts
would reciprocate by executing a deed to him individually and for the benefit of the
other Scott Defendants. The Scotts, in joint venture or conspiracy with Capps, then
used the Rule 11 Agreement to proceed to judgment in the case and the judgment
may have not become procedurally “final” as to Hines and the other Scott
Defendants. Billy G. Hines executed a deed and delivered it to the attorney for
Buetta Scott and Rajena Scott pursuant to the Rule 11 Agreement. The Scott
Defendants filed that deed for record. However, instead of completing the Rule 11
Agreement by conveying all of their interest in the 45 acre Scott Tract, the Scott
Plaintiffs conveyed their interest in that tract granted by the judgment to Curtis
Capps who then inequitably used it against third parties, Hines, and the other Scott
heirs in another lawsuit to attempt to oust them of title to such 45 acres of the land
in question in this case. This was a fraudulent misrepresentation involving a
transaction in real estate.
….
7. … Plaintiff requests the Court to enforce specific performance of the
Rule 11 Agreement made by the Scott Defendants through their attorney, Bill
Youngkin and require them and their co-conspirators, Curtis Capps and Bill
Youngkin, to convey all of their interest in the 45 acres so that it may be used and
enjoyed exclusively by Plaintiff and the other Scott heirs.
8. … Plaintiff asserts … an agreement was reached between Bill Youngkin,
his client, Buetta Scott and Rajena Scott whereby Billy G. Hines, Jr. agreed he
would convey his undivided interest in the surface acres of the entire 285 acres in
dispute as consideration for a conveyance from Buetta Scott and Rajena Scott of all
their interest in the 45 acres including their interest transferred by Final Judgment
in said Cause No. 10-000305-CV-85 in dispute herein and that upon such
conveyance from Buetta Scott and Rajena Scott, the Alex Scott Heirs including
Plaintiff would have 100 percent ownership in said 45 acre tract.
9. This Rule 11 Agreement as originally agreed to by Plaintiff and Buetta
Scott and Rajena Scott and Bill Youngkin was fully stated … and was dictated into
the Court’s record. … Thus, Defendant Capps’ deed allegedly given for
consideration of fulfillment of that agreement should be reformed so that it will
convey all of Buetta Scott and Rajena Scott’s interest in the 45 acres that was
acquired pursuant to the Judgment in Cause No. 10-000305-CV-85 so that the Scott
Heirs will have 100 percent ownership in the 45 acre tract for their exclusive use.
10. Plaintiff was at all times ready, willing and able to perform his part of
the contract and has in fact performed. Pursuant to such performance, on March
27, 2011, Plaintiff executed and delivered by general warranty deed to Defendants
Youngkin v. Hines Page 5
Buetta Scott and Rajena Scott all of his interest in that certain 285.5 acre tract in
the J.M. Barrera Survey, Brazos County, Texas. Defendants however have refused
and failed to convey the 45 acre Alex Scott property to Plaintiff, and instead have
conveyed all their interest in both the 285.5 acres to Curtis Capps, as well as that
portion of the 285.5 acres, subsequently surveyed and described as 44.878 acres
a/k/a 45 acres.
….
21. … Plaintiff asserts that at all times Defendant Bill Youngkin acted as
the agent for Defendants Buetta Scott and Rajena Scott and on their behalf made
the promises, false representations and inducements at the December 15, 2010
hearing in Cause No. 10-000305-CV in the 85th District Court upon which Plaintiff
relied in entering into the Rule 11 Agreement. Plaintiff contends that Defendant
Bill Youngkin conspired with Defendants in an scheme to deprive Plaintiff of his
interest in the 285 acres, that he participated in obtaining the Rule 11 Agreement
knowing that Defendants Buetta Capps [sic] and Rajena Capps [sic] had no
intention of performing and that their interests acquired by the fraudulently
obtained judgment in Cause No. 10-000305-CV would almost be immediately
conveyed to Defendant Capps. [Emphasis added.]
22. If Defendant Youngkin acted without authority or approval from either
Buetta and/or Rajena Scott so that he could obtain Plaintiff’s agreement for the
December 15, 2010 Final Judgment in order to further his own conspiracy and
scheme with Defendant Capps to acquire Plaintiff’s title and agreement to convey,
then Plaintiff entered into the Rule 11 Agreement in reliance upon the false
representations made by Bill Youngkin on December 15, 2010. Defendant Bill
Youngkin intended that Plaintiff rely on his false representations which were
intended to induce Plaintiff into entering into the Agreement. [Emphasis added.]
23. Since the Defendant Curtis Capps acquired the interest subject to the
deeds from Buetta Scott and Rajena Scott at the time that he was also represented
by Mr. Bill Youngkin, the three principals acted in accordance with the multiple
misrepresentations made by Defendant Youngkin to the Court and to the Plaintiffs
and have fraudulently induced Plaintiff to convey his undivided interest in the 285
acre tract to Buetta and Rajena Scott and ultimately to Capps. Thereafter, Curtis
Capps used the wrongfully and/or fraudulently obtained interest under the deeds in
an inequitable manner to pursue claims against third parties including Plaintiff and
the other Scott heirs for divestiture of title to land by filing suits and using the
wrongfully obtained deeds as an assertion of ownership and/or title to land. If
Capps is found to have been in possession and knowledge of the Scotts’ obligations
and their failure to perform he is not a bona fide purchaser. Based upon this
knowledge Capps and Youngkin should be deemed as parties to the Scotts’ fraud
and/or misrepresentation and failure to perform under the written agreement
entered into by Youngkin as the attorney for the Scotts. To the extent all Defendants
operated together to achieve the inequitable result of obtaining a deed form Billy
Youngkin v. Hines Page 6
G. Hines to a real property interest, they have conspired to deprive him of a real
property interest and obtain a judgment by the misconduct and should be subject
to the same penalties for disgorgement of the interest they have obtained, statutory
damages and cancellation of the deed. [Emphasis added.]
In response to being added as a defendant, Youngkin filed a motion to dismiss Hines’s
claims under the Texas Citizens Participation Act (TCPA), known as an anti-SLAPP law
(“strategic lawsuit against public participation”). See generally In re Lipsky, 460 S.W.3d 579, 589
(Tex. 2015); Harper v. Best, --- S.W.3d ---, 2016 WL 1613546 (Tex. App.—Waco Apr. 21, 2016,
no pet. h.); Laura Lee Prather & Justice Jane Bland, Bullies Beware: Safeguarding Constitutional
Rights Through Anti-SLAPP in Texas, 47 TEX. TECH L. REV. 725 (2015). The trial court denied
Youngkin’s motion to dismiss, and Youngkin appeals. See TEX. CIV. PRAC. & REM. CODE ANN. §
27.008(b) (West 2015), § 51.014(a)(12) (West Supp. 2015).
Youngkin’s first issue asserts that the trial court erred by refusing to dismiss Hines’s claims
against him under the TCPA. “The purpose of [the TCPA] is to encourage and safeguard the
constitutional rights of persons to petition, speak freely, associate freely, and otherwise participate
in government to the maximum extent permitted by law and, at the same time, protect the rights
of a person to file meritorious lawsuits for demonstrable injury.” TEX. CIV. PRAC. & REM. CODE
ANN. § 27.002 (West 2015). The TCPA’s purpose is to identify and summarily dispose of lawsuits
designed only to chill First Amendment rights, not to dismiss meritorious lawsuits. Lipsky, 460
S.W.3d at 589. It protects citizens from retaliatory lawsuits that seek to intimidate or silence them
on matters of public concern. Id. at 586.
The TCPA provides a special procedure for the expedited dismissal of such suits. See TEX.
CIV. PRAC. & REM. CODE ANN. § 27.003(a) (West 2015) (“If a legal action is based on, relates to,
or is in response to a party’s exercise of the right of free speech, right to petition, or right of
association, that party may file a motion to dismiss the legal action.”). A two-step process is
Youngkin v. Hines Page 7
initiated by motion of a party (typically a defendant) who believes that the lawsuit is in response
to the defendant’s exercise of First Amendment rights. Lipsky, 460 S.W.3d at 586.
Under the first step, the burden is on the movant, typically a defendant, to show “by a
preponderance of the evidence” that the plaintiff’s claim “is based on, relates to, or is in response
to the [defendant’s] exercise of: (1) the right of free speech; (2) the right to petition; or (3) the
right of association.” TEX. CIV. PRAC. & REM. CODE ANN. § 27.005(b) (West 2015); Lipsky, 460
S.W.3d at 586-87. If the defendant is able to demonstrate that the plaintiff’s claim implicates one
of these rights, the second step shifts the burden to the plaintiff to establish by “clear and specific
evidence a prima facie case for each essential element of the claim in question.” TEX. CIV. PRAC.
& REM. CODE ANN. § 27.005(c); Lipsky, 460 S.W.3d at 587. Further, the trial court “shall dismiss
a legal action against the moving party if the moving party establishes by a preponderance of the
evidence each essential element of a valid defense to the nonmovant’s claim.” TEX. CIV. PRAC. &
REM. CODE ANN. § 27.005(d).
The trial court must timely rule on the motion and must dismiss the plaintiff’s claim if the
defendant’s constitutional rights are implicated and the plaintiff has not met the required showing
of a prima facie case. Id. § 27.005; Lipsky, 460 S.W.3d at 587. In determining whether the
plaintiff’s claim should be dismissed, the trial court is to consider the pleadings and any supporting
and opposing affidavits. TEX. CIV. PRAC. & REM. CODE ANN. § 27.006(a) (West 2015); Lipsky,
460 S.W.3d at 587.
We review de novo a trial court’s ruling on a motion to dismiss under the TCPA. Johnson-
Todd v. Morgan, 480 S.W.3d 605, 609 (Tex. App.—Beaumont 2015, pet. denied). In reviewing
the trial court’s ruling, we consider the pleadings and the evidence that the trial court considered.5
5
Youngkin did not request the trial court to issue findings, as provided by section 27.007. See TEX. CIV. PRAC. &
REM. CODE ANN. § 27.007(a) (West 2015) (“the court shall issue findings regarding whether the legal action was
Youngkin v. Hines Page 8
Id. We view the pleadings and the evidence in the light most favorable to Hines, who is both the
nonmovant and the prevailing party below. Sloat v. Rathbun, --- S.W.3d ---, ---, 2015 WL
6830927, at *3 (Tex. App.—Austin Nov. 6, 2015, pet. filed); see also James v. Calkins, 446
S.W.3d 135, 147-48 (Tex. App.—Houston [1st Dist.] 2014, pet. denied); Cheniere Energy, Inc. v.
Lotfi, 449 S.W.3d 210, 214 (Tex. App.—Houston [1st Dist.] 2014, no pet.).
We first address whether Youngkin has shown by a preponderance of the evidence that
Hines’s claims pertaining to Youngkin’s in-court statements implicate Youngkin’s exercise of the
right to petition. Under the TCPA, “exercise of the right to petition” means, among other things,
“a communication in or pertaining to … a judicial proceeding.” TEX. CIV. PRAC. & REM. CODE
ANN. § 27.001(4)(A)(i) (West 2015). A “‘[c]ommunication’ includes the making or submitting of
a statement or document in any form or medium, including oral, visual, written, audiovisual, or
electronic.” Id. § 27.001(1). The exercise of the right to petition under the TCPA includes an
attorney’s in-court communications. Johnson-Todd, 480 S.W.3d at 609; see also James, 446
S.W.3d at 147-48 (TCPA applied to opposing attorney’s conduct in litigation and filing of notice
of lis pendens).
Hines’s live pleading and the parties’ summary-judgment evidence6 demonstrate that
Hines’s claims are largely based on Youngkin’s in-court statements pertaining to the Rule 11
agreement that was dictated into the record. Because the exercise of the right to petition under the
TCPA includes an attorney’s in-court communications, we hold that Youngkin met his initial
burden under the TCPA of showing by a preponderance of the evidence that Hines’s claims
implicate Youngkin’s exercise of the right to petition.
brought to deter or prevent the moving party from exercising constitutional rights and is brought for an improper
purpose, including to harass or to cause unnecessary delay or to increase the cost of litigation”).
6
Youngkin had filed a motion for summary judgment.
Youngkin v. Hines Page 9
We thus move to the second step, which shifts the burden to Hines to establish by “clear
and specific evidence a prima facie case for each essential element of the claim in question.” TEX.
CIV. PRAC. & REM. CODE ANN. § 27.005(c). “Clear and specific evidence” includes circumstantial
evidence, which is “simply indirect evidence that creates an inference to establish a central fact.”
Lipsky, 460 S.W.3d at 584, 588-89. A “prima facie case” “refers to evidence sufficient as a matter
of law to establish a given fact if it is not rebutted or contradicted and is the “’minimum quantum
of evidence necessary to support a rational inference that the allegation of fact is true.’” Id. at 590.
We also address whether Youngkin established by a preponderance of the evidence each
essential element of a valid defense—in this case, the litigation privilege—to Hines’s claims. As
discussed above, we examine the evidence in the light most favorable to Hines.
We first address Youngkin’s litigation-privilege defense, which was raised in his
memorandum in support of his motion to dismiss. Youngkin’s trial-court memorandum and his
brief include this quotation:
The litigation privilege protects an attorney from personal liability
stemming from conduct that the “attorney engages in as part of the discharge of his
duties in representing a party in a lawsuit.” Bradt v. West, 892 S.W.2d 56, 72 (Tex.
App.—Houston [1st Dist.] 1994, writ denied) (op. on reh’g). “Stated differently,
an attorney cannot be held liable to a third party for conduct that requires ‘the office,
professional training, skill, and authority of an attorney.’“ Miller v.
Stonehenge/FASA-Texas, JDC, L.P., 993 F. Supp. 461, 464 (N.D. Tex.
1998) (quoting Taco Bell Corp. v. Cracken, 939 F. Supp. 528, 532 (N.D. Tex.
1996)). The litigation privilege focuses on the type of conduct engaged in by the
attorney, rather than on whether the conduct was meritorious in the context of the
underlying lawsuit. Bradt, 892 S.W.2d at 72 (stating that, for example, attorney
could not be sued by opposing party for filing meritless or frivolous motions,
“because making motions is conduct an attorney engages in as part of the discharge
of his duties in representing a party in a lawsuit”). If an attorney’s conduct violates
his professional responsibility, the remedy is “public, not private.” Renfroe v. Jones
& Assocs., 947 S.W.2d 285, 287 (Tex. App.—Fort Worth 1997, writ denied). The
purpose behind the litigation privilege is to protect an attorney’s “right to interpose
any defense or supposed defense and make use of any right in behalf of such client
or clients as [the attorney] deem[s] proper and necessary, without making himself
subject to liability in damages.” Morris v. Bailey, 398 S.W.2d 946, 947 (Tex. Civ.
Youngkin v. Hines Page 10
App.—Austin 1966, writ ref’d n.r.e.). Any other policy “would dilute the vigor
with which Texas attorneys represent their clients, which would not be in the best
interests of justice.” Bradt, 892 S.W.2d at 72.
[The plaintiff/appellant] argues that his claims against the Attorney
Appellees are not barred by the litigation privilege because they arise from
fraudulent conduct, which is “foreign to the duties of an attorney.” Poole v.
Houston & T.C. Ry. Co., 58 Tex. 134, 137 (1882). The litigation privilege is
inapplicable if an attorney knowingly participates in fraudulent activities outside
the scope of his legal representation of the client. See Likover v. Sunflower Terrace
II Ltd., 696 S.W.2d 468, 472 (Tex. App.—Houston [1st Dist.] 1985, no
writ) (holding attorney liable for assisting client in perpetrating fraudulent business
scheme involving sale of apartment complex); Bourland v. State, 528 S.W.2d 350,
357 (Tex. Civ. App.—Austin 1975, writ ref’d n.r.e.) (holding attorney liable for
misrepresentations made to investors in client’s fraudulent real estate scheme). In
the present case, however, the complained-of actions taken by the Attorney
Appellees are all actions that fall within the context of their duty to represent
Michels in litigation—filing a lawsuit for injunctive relief, seeking and obtaining a
temporary restraining order, and negotiating and filing a Rule 11 agreement. Such
actions, which require the professional training, skill, and authority of an attorney,
have been considered insufficient to form the basis of a fraud claim against an
attorney by a non-client. See Alpert v. Crain, Caton & James, P.C., 178 S.W.3d
398, 408 (Tex. App.—Houston [1st Dist.] 2005, pet. denied) (holding that litigation
privilege bars fraud claim based on actions such as filing lawsuits and pleadings,
providing legal advice, and awareness of settlement negotiations); White v.
Bayless, 32 S.W.3d 271, 276 (Tex. App.—San Antonio 2000, pet. dism’d w.o.j.)
(holding that claim of conspiracy to commit fraud was barred by litigation privilege
because attorneys’ actions of preparing and filing various pleadings were “actions
taken as attorneys representing their client”). Furthermore, an attorney owes no
duty to non-client parties in the adversarial context of litigation. See McCamish,
Martin, Brown & Loeffler v. F.E. Appling Interests, 991 S.W.2d 787, 795 (Tex.
1999) (“[A] third party’s reliance on an attorney’s representation is not justified
when the representation takes place in an adversarial context.”); see also Chu v.
Hong, 249 S.W.3d 441, 446 n.19 (Tex. 2008) (citing McCamish for proposition
that “fraud actions cannot be brought against an opposing attorney in litigation as
reliance in those circumstances is unreasonable”).
Michels v. Zeifman, No. 03-08-00287-CV, 2009 WL 349167, at *2-3 (Tex. App.—Austin Feb. 12,
2009, no pet.) (mem. op.).
On the other hand, the rule does not provide absolute immunity for every
tort committed by a lawyer, however tangentially related to her professional role.
… An attorney also may be subject to liability for committing fraud or conspiring
with her client to defraud another. See Transtexas Gas Corp. v. Stanley, 881
F. Supp. 268, 270–71 (S.D. Tex. 1994); Likover v. Sunflower Terrace II Ltd., 696
Youngkin v. Hines Page 11
S.W.2d 468, 472 (Tex. App.—Houston [1st Dist.] 1985, no writ); Kirby v.
Cruce, 688 S.W.2d 161, 164–65 (Tex. App.—Dallas 1985, writ ref’d n.r.e.);
Bourland v. State of Texas, 528 S.W.2d 350, 353–55 (Tex. Civ. App.—Austin
1975, writ ref’d n.r.e.).
Miller, 993 F. Supp. at 464-65.
In response to Youngkin’s litigation-privilege defense, Hines cites to and quotes from
Likover, which is cited in Youngkin’s above quotation from Michels:
An attorney has no general duty to the opposing party, but he is liable for
injuries to third parties when his conduct is fraudulent or malicious. He is not liable
for breach of a duty to the third party, but he is liable for fraud. Wilbourn v. Mostek
Corp., 537 F. Supp. 302 (D. Colo. 1982).
A lawyer is authorized to practice his profession, to advise his clients, and
to interpose any defense or supposed defense, without making himself liable for
damages. Morris v. Bailey, 398 S.W.2d 946 (Tex. Civ. App.—Austin 1966, writ
ref’d n.r.e.); Kruegel v. Murphy, 126 S.W. 343, 345 (Tex. Civ. App. 1910, writ
ref’d).
However, an attorney is liable if he knowingly commits a fraudulent act that
injures a third person, or if he knowingly enters into a conspiracy to defraud a third
person. Hennigan v. Harris County, 593 S.W.2d 380 (Tex. Civ. App.—Waco 1979,
no writ). Over 100 years ago, the Supreme Court of Texas held that where a lawyer
acting for his client participates in fraudulent activities, his action in so doing is
“foreign to the duties of an attorney.” Poole v. Houston & T.C. Ry, 58 Tex. 134,
137 (1882). The Court held that a lawyer could not shield himself from liability on
the ground that he was an agent, because no one is justified on that ground in
knowingly committing a willfull and premeditated fraud for another. Id. at 137-38.
Likover, 696 S.W.2d at 472. Hines also points out that McCamish holds that, under certain
circumstances, an attorney can be liable for negligent misrepresentation to a nonparty. See
McCamish, 991 S.W.2d at 793-94.
Youngkin’s litigation-privilege defense thus leads us back to Hines’s common-law fraud,
statutory fraud, and conspiracy claims.
“A plaintiff seeking to prevail on a fraud claim must prove that (1) the
defendant made a material misrepresentation; (2) the defendant knew the
representation was false or made the representation recklessly without any
knowledge of its truth; (3) the defendant made the representation with the intent
Youngkin v. Hines Page 12
that the other party would act on that representation or intended to induce the
party’s reliance on the representation; and (4) the plaintiff suffered an injury by
actively and justifiably relying on that representation.” Exxon Corp. v. Emerald
Oil & Gas Co., L.C., 348 S.W.3d 194, 217 (Tex. 2011).
James, 446 S.W.3d at 148.7
To prove statutory fraud in a real estate transaction, a plaintiff must show:
(1) a false representation of a past or existing material fact, when the false
representation is (A) made to a person for the purpose of inducing the person to
enter into a contract and (B) relied on by that person in entering into that contract;
or (2) a false promise to do an act, when the false promise is (A) material, (B) made
with the intention of not fulfilling it, (C) made to a person for the purpose of
inducing that person to enter into a contract, and (D) relied on by that person in
entering into that contract. TEX. BUS. & COMM. CODE ANN. § 27.01(a) (Vernon
2002).
Coldwell Banker Whiteside Assocs. v. Ryan Equity Partners, Ltd., 181 S.W.3d 879, 888 (Tex.
App.—Dallas 2006, no pet.).
“’[I]ntent to defraud is not susceptible to direct proof [and] invariably must be proven by
circumstantial evidence.’” Lipsky, 460 S.W.3d at 588 (quoting Spoljaric v. Percival Tours, Inc.,
708 S.W.2d 432, 435 (Tex. 1986)).
“A promise of future performance constitutes an actionable
misrepresentation if the promise was made with no intention of performing at the
time it was made.” Formosa Plastics, 960 S.W.2d at 48. “Proving that a party had
no intention of performing at the time a contract was made is not easy, as intent to
defraud is not usually susceptible to direct proof.” Tony Gullo Motors I, L.P. v.
Chapa, 212 S.W.3d 299, 305 (Tex. 2006) (citing Spoljaric v. Percival Tours, Inc.,
708 S.W.2d 432, 435 (Tex. 1986)). While breach of the contract alone is not
evidence that a party did not intend to perform, “breach combined with ‘slight
circumstantial evidence’ of fraud” is some evidence of fraudulent intent, enough to
support a verdict. Id. “[A] party’s intent is determined at the time the party made
the representation, [but] it may be inferred from the party’s subsequent acts after
the representation is made.” Spoljaric, 708 S.W.2d at 434 (citing Chicago, T. &
M.C. Ry. Co. v. Titterington, 84 Tex. 218, 19 S.W. 472, 474 (1892)).
7
Because Youngkin’s argument that Hines could not have justifiably relied on Youngkin’s representations is raised
for the first time on appeal, that issue is not before us. Also, the TCPA does not provide a procedural avenue for
raising potentially dispositive legal questions; it only provides for the nonmovant’s establishment of a prima facie
case or the movant’s establish of a valid defense by a preponderance of the evidence. See TEX. CIV. PRAC. & REM.
CODE ANN. § 27.005(c, d).
Youngkin v. Hines Page 13
Aquaplex, Inc. v. Rancho La Valencia, Inc., 297 S.W.3d 768, 774-75 (Tex. 2009).
An actionable civil conspiracy is a combination by “two or more persons to
accomplish an unlawful purpose or to accomplish a lawful purpose by unlawful
means.” Cotten v. Weatherford Bancshares, Inc., 187 S.W.3d 687, 701 (Tex.
App.—Fort Worth 2006, pet. denied). The essential elements of a civil conspiracy
are “(1) two or more persons; (2) an object to be accomplished; (3) a meeting of the
minds on the object or course of action; (4) one or more unlawful, overt acts; and
(5) damages as the proximate result.” Id. A defendant’s liability for conspiracy
depends on “participation in some underlying tort for which the plaintiff seeks to
hold at least one of the named defendants liable.” Id.; see also Carroll v. Timmers
Chevrolet, Inc., 592 S.W.2d 922, 925 (Tex. 1979) (“It is not the agreement itself,
but an injury to the plaintiff resulting from an act done pursuant to the common
purpose that gives rise to the cause of action.”). Recovery for civil conspiracy is
not based on the conspiracy but on the underlying tort. Tilton v. Marshall, 925
S.W.2d 672, 681 (Tex. 1996) (orig. proceeding) (op. on reh’g). Once a civil
conspiracy is proven, each coconspirator “is responsible for all acts done by any of
the conspirators in furtherance of the unlawful combination.” Carroll, 592 S.W.2d
at 926. A civil conspiracy claim may be proved by circumstantial evidence and
reasonable inferences from parties’ actions. Int’l Bankers Life Ins. Co. v. Holloway,
368 S.W.2d 567, 581 (Tex. 1963).
In re Lipsky, 411 S.W.3d 530, 549 (Tex. App.—Fort Worth 2013, orig. proceeding), mand. denied,
460 S.W.3d 579 (Tex. 2015).
Hines’s affidavit provides in pertinent part:
6. … I personally appeared with my attorney in court and prior to the case
being called entered into negotiations to settle the claims against me and, in part, to
retain and preserve at least part of the property for my family.
7. On December 15, 2010 as a result of these negotiations, I agreed with
Buetta and Rajena Scott’s attorney, Bill Youngkin, that I was going to convey all
of my undivided interest in the surface estate of the 285 acres being litigated, but I
would retain my mineral interest in that same property. We further agreed that
previously there had been a portion of the 285 acres at issue deeded to my family,
the Scott heirs, which contained 45 acres, but that the 45 acres may not have been
validly described in that deed. We then agreed that for my agreeing not to continue
to contest the litigation and to convey all of my surface ownership in the 285 acres
to them, Buetta Scott and Rajena Scott would convey by deed with a legal
description to be determined by survey, the undivided one-half interest in the 45
acres at issue resulting from the Judgment to be entered in the lawsuit [Cause No.
10-000305-CV-85], … which would produce ownership in me and all the other
heirs of Alex Scott, so that the Alex Scott heirs would then have 100% ownership
in that 45 acre tract yet to be surveyed. We agreed Buetta Scott and Rajena Scott
Youngkin v. Hines Page 14
would make this conveyance once the Judgment in the pending lawsuit became
final. This was fully stated and dictated by Mr. Youngkin to Judge Langley and his
court reporter.
8. I was then asked whether the terms that Mr. Youngkin had stated to the
Judge reflected the agreement and understanding that we had agreed to. I answered,
yes it does and I have no questions or concerns regarding this agreement. Finally I
again expressed by agreement that upon conclusion by Judgment of the suit and
completion of the survey, I would convey my surface interest in the entire 285 acres
to Buetta Scott and Rajena Scott and the Plaintiffs, Buetta Scott and Rajena Scott
would convey their 50% interest in the Alex Scott survey back to me and the other
heirs of Alex Scott and at that time the Defendant Scott heirs would own 100% of
the 45 acres.
….
11. I would not have agreed to the settlement of Cause No. 10-000305-CV-
85 and the conveyance of my surface interest in the 285 acres unless Buetta Scott
and Rajena Scott agreed to convey all their interests in the 45 acres so that it would
be owned one hundred percent (100%) by the Scott heirs. It was my intention and
part of the Rule 11 Agreement that the 45 acre tract would be set aside for the
exclusive use of the Scott heirs.
12. I relied on the representations and commitments made by Bill Youngkin
as Buetta Scott’s and Rajena Scott’s attorney in agreeing to the Rule 11 Agreement.
I would not have entered into that Agreement nor settled Cause No. 10-000305-
CV-85 had I known that there was never an intent to convey as a result of the
Judgment, the 45 acre tract to me and the other Scott heirs for our exclusive use.
13. I signed and my lawyer delivered a deed conveying all of my interest
in the surface estate of the 285 acres … .
14. I never received a deed from Buetta Scott or Rajena Scott. I never
received a deed from Curtis Capps complying with the Rule 11 Agreement. The
deed Bill Youngkin showed me in my deposition … conveyed only my original
interest in the 45 acre tract and not the entire interest adjudged, and conveyed to
Buetta and Rajena Scott by the Judgment … , and it does not comply with the Rule
11 Agreement. The first time I saw this deed was at my deposition.
15. Curtis Capps has now filed, through his attorney, Bill Youngkin, Cause
No. 14-000569-CV-361 against the Known and Unknown Heirs of Alex Scott
including me and claims he owns by undivided interest 22.928347 acres or
51.2159% of the 45 acres which Mr. Youngkin agreed to have his clients convey
to me and the Alex Scott heirs for our exclusive use and possession upon
completion of the survey and upon completion of the litigation and entry of
Judgment in the 2010 lawsuit.
Youngkin v. Hines Page 15
Hines’s evidence, which we view in the light most favorable to Hines, shows that he
entered into a settlement agreement with the Scotts, who were to convey by deed to Hines an
interest in the 45 acres that would leave the Alex Scott heirs with 100% ownership of the 45-acre
tract. Instead, the Scotts conveyed their interest in the 45 acres to Capps, another Youngkin client,
and Capps conveyed to Hines an interest in the 45 acres that did not leave the Alex Scott heirs with
100% ownership. Youngkin prepared the deeds for these conveyances, and those deeds are
included in Hines’s evidence. Capps then used his ownership interest that he obtained from the
Scotts in the 45 acres in yet another lawsuit in which he was represented by Youngkin. We
conclude that Hines established by clear and specific evidence, including circumstantial evidence,
a prima facie case for each essential element of his fraud and conspiracy claims against Youngkin.
We further conclude that, in the face of Hines’s prima facie case, Youngkin did not
establish his litigation-privilege defense by a preponderance of the evidence with his bare assertion
that he was acting as the Scotts’ attorney in litigation.
Accordingly, we overrule issue one and need not address issue two on the recovery of
attorney’s fees in the event of dismissal under the TCPA. We affirm the trial court’s order denying
Youngkin’s motion to dismiss, and this case is remanded.8
REX D. DAVIS
Justice
Before Chief Justice Gray,
Justice Davis, and
Justice Scoggins
8
We unfortunately must address the unprofessional comments made by Youngkin’s attorney in his reply brief. These
personal attacks (“dirty lawyering,” “casual dishonesty,” “unscrupulous lawyers”) against Hines’s counsel have no
place in an appellate brief, and they blatantly violate several provisions in the Texas Lawyer’s Creed pertaining to
civility and courtesy. These comments add nothing to the case; they only reflect poorly on Youngkin’s attorney.
Youngkin v. Hines Page 16
(Chief Justice Gray concurs in the judgment only.)
Affirmed
Opinion delivered and filed July 13, 2016
[CV06]
Youngkin v. Hines Page 17