Elaine T. Marshall,Edward Alexander, Adam Johnson, Wayne Thompson, Lilynn Cutrer, and Karen Aucion v. Preston Marshall ( 2021 )

Reversed and Rendered and Memorandum Opinion filed March 16, 2021.
In The
Fourteenth Court of Appeals
NO. 14-17-00930-CV
ELAINE T. MARSHALL, EDWARD ALEXANDER, ADAM JOHNSON,
WAYNE THOMPSON, LILYNN CUTRER, AND KAREN AUCION,
Appellants
V.
PRESTON MARSHALL, Appellee
On Appeal from the Probate Court No. 4
Harris County, Texas
Trial Court Cause Nos. 365,053 & 365,053-404
MEMORANDUM OPINION
The original trustee and five co-trustees of two trusts appeal the trial court’s
order granting a temporary injunction preventing the co-trustees from receiving
compensation, disposing of trust assets, and participating in litigation against the
beneficiary. We hold that the trial court abused its discretion by granting the
injunction in the absence of evidence of an imminent and irreparable injury or a
need for an anti-suit injunction. Accordingly, we reverse the trial court’s order and
render a judgment denying the application for a temporary injunction.
I. BACKGROUND
Preston Marshall is a beneficiary of two inter vivos trusts settled by his late
father: the Harrier Trust and the Falcon Trust. Preston’s mother, Elaine Marshall,
is the trustee of each trust. The trust instruments provide that the trustee is entitled
to reasonable compensation. The trusts are governed by the Louisiana Trust Code,
and the trustee “shall apply to the 14th Judicial District Court for Calcasieu Parish,
Louisiana, for instructions regarding any questions that might arise regarding
administration of the Trust.”
The Harrier trust is a principal beneficiary of another trust, the EPM Marital
Income Trust, for which Elaine is also a trustee. As discussed in this court’s prior
opinion, Elaine took actions to merge the Marital Income Trust into another trust in
Wyoming. See Marshall v. Marshall, No. 14-18-00094-CV, 2021 WL 208459, at
*2–3 (Tex. App.—Houston [14th Dist.] Jan. 21, 2021, no pet. h.) (mem. op.).
After Preston sued Elaine in the Harris County Probate Court for an
accounting and other claims, she appointed the five other appellants in this case as
co-trustees of the Harrier and Falcon Trusts. The appointment and acceptance
documents describe a compensation scheme for the co-trustees that is based on, in
part, the gross trust receipts of the trusts and the value of the trusts’ interests in the
Marital Income Trust.
Elaine then filed a petition for declaratory relief in the 14th Judicial District
Court for Calcasieu Parish, Louisiana, requesting the court declare, among other
things, that (1) the co-trustees were properly appointed as co-trustees of the Harrier
Trust, and (2) a Wyoming judgment regarding the Marital Income Trust is “entitled
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to full faith and credit and that the Trustees of the Harrier Trust be and are bound
thereby.” Elaine moved for a partial summary judgment regarding the first
declaration.1
In his original petition in this case, Preston applied for a temporary
injunction to prohibit the co-trustees from exercising powers, obligations,
responsibilities, and rights to compensation from the trusts. The co-trustees filed a
special appearance and a general denial subject to the special appearance. Their
attorney appeared at the temporary injunction hearing subject to the special
appearance.2
After the hearing, the trial court signed an order granting the temporary
injunction along with findings of fact and conclusions of law. The court enjoined
the co-trustees from taking the following actions:
• Receiving compensation in accordance with the December
2016 Appointment Documents;
• Taking any action that could affect the Harrier and Falcon Trust
assets, including but not limited to transferring, selling, offering
for sale, encumbering, or pledging the trust assets;
1
Ultimately, the Louisiana trial court granted the motion, and the court of appeals
affirmed. See In re Harrier Trust, 264 So. 3d 526, 530, 536 (La. Ct. App. 2019). The co-
trustees moved this court to take judicial notice of the existence and contents of the Louisiana
trial court’s judgment, contending that the judgment is germane to the co-trustees’ challenge to
certain findings in this appeal regarding personal jurisdiction over the co-trustees. We do not
address those findings because they are unnecessary to the appeal. See Tex. R. App. 47.1. To
the extent the co-trustees suggest the Louisiana court’s judgment should be considered as
evidence that was not before the trial court when ruling on the temporary injunction, their motion
is denied. See Freedom Commc’ns, Inc. v. Coronado, 372 S.W.3d 621, 623 (Tex. 2012) (“As a
general rule, appellate courts take judicial notice of facts outside the record only to determine
jurisdiction over an appeal or to resolve matters ancillary to decisions which are mandated by
law . . . .” (quotation omitted)); cf. WorldPeace v. Comm’n for Lawyer Discipline, 183 S.W.3d
451, 459 (Tex. App.—Houston [14th Dist.] 2005, pet. denied) (refusing to take judicial notice of
a prior lawsuit to satisfy burden of proof in the trial court for res judicata).
2
The trial court denied the special appearance, and this court has affirmed the ruling in a
separate opinion issued in Case No. 14-18-00425-CV.
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• Attempting to circumvent this Court’s jurisdiction over the
Harrier and Falcon Trust by 1) seeking validation of the
compensation provisions set out in the December 2016
Appointment Documents in any other court; and 2) seeking a
determination that the rulings in Wyoming with respect to such
Trusts are entitled to full faith and credit; [and]
• Assisting Mrs. Marshall in any litigation against Preston
Marshall concerning the Harrier and Falcon Trusts.
Elaine and the co-trustees appeal.
II. ANALYSIS
In their dispositive issues on appeal, the co-trustees contend that the trial
court abused its discretion by rendering (1) an impermissible anti-suit injunction
and (2) an injunction in the absence of evidence of probable, imminent, and
irreparable harm. Preston responds that the co-trustees waived any complaint that
the injunction is an anti-suit injunction, the injunction is necessary to protect the
trial court’s jurisdiction, and the injunction is supported by evidence of irreparable
harm.
A. General Principles and Standard of Review
A temporary injunction’s purpose is to preserve the status quo of the
litigation’s subject matter pending a trial on the merits. Butnaru v. Ford Motor
Co., 84 S.W.3d 198, 204 (Tex. 2002). A temporary injunction is an extraordinary
remedy and does not issue as a matter of right. Id. To obtain a temporary
injunction, the applicant must plead and prove three elements: (1) a cause of action
against the defendant; (2) a probable right to the relief sought; and (3) a probable,
imminent, and irreparable injury in the interim. Id.This court may reverse an order granting a temporary injunction only if the
trial court abused its discretion. Id. A trial court does not abuse its discretion if
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some evidence reasonably supports the trial court’s decision. Wash. DC Party
Shuttle, LLC v. IGuide Tours, 406 S.W.3d 723, 740 (Tex. App.—Houston [14th
Dist.] 2013, pet. denied) (en banc) (citing Butnaru, 84 S.W.3d at 211). But, a trial
court has no discretion to grant a temporary injunction without supporting
evidence. See Ron v. Ron, 604 S.W.3d 559, 568 (Tex. App.—Houston [14th Dist.]
2020, no pet.). We view the evidence in the light most favorable to the trial court’s
decision. Wash. DC Party Shuttle, 406 S.W.3d at 740.
B. No Waiver
Generally, a party must preserve error as a prerequisite to presenting a
complaint for appellate review. See Tex. R. App. 33.1(a). But, in a civil nonjury
case, a complaint regarding the legal or factual insufficiency of the evidence may
be made for the first time on appeal in the complaining party’s brief. Tex. R. App.
33.1(d). The co-trustees contend that their complaints fall within this category of
error for which preservation is not required. We agree.
We must construe the brief liberally and reasonably so the right to appeal is
not lost by waiver. Lion Copolymer Holdings, LLC v. Lion Polymers, LLC, 614
S.W.3d 729, 732 (Tex. 2020). We hesitate to resolve cases based on procedural
defects and instead endeavor to resolve cases on the merits. Id. We look to the
wording of the issues and the arguments under each heading to assess the intent of
the parties. See id.The co-trustees argue in their brief that there is “no legal or factual support”
and the “facts do not support” the anti-suit injunction. The co-trustees contend that
there is “no evidence” of a probable, imminent, and irreparable harm. The co-
trustees detail how the evidence presented at the temporary injunction hearing does
not support the trial court’s findings or the legal requirements for a temporary
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injunction. We construe these arguments as challenges to the sufficiency of the
evidence to support the trial court’s temporary injunction. See id.Preston’s authorities are procedurally distinct and do not command a
different result. The first case, Ford v. Ruth, involved a direct attack on a default
judgment that granted a permanent injunction. See No. 03-14-00460-CV, 2016
WL 1305209, at *2 (Tex. App.—Austin Mar. 31, 2016, pet. denied) (mem. op.).
Noting that the appellants did not file any pleadings in the trial court or a motion
for new trial or bill of review, the Austin Court of Appeals held that the
defendants’ complaints about venue and the overbreadth of the permanent
injunction were ones that had to be preserved. See id. In Ford, because the
defendants filed no answer, the plaintiff had no burden to prove its entitlement to a
permanent injunction, which is not a claim for unliquidated damages. See Siddiqui
v. West Bellfort Prop. Owners Ass’n, 819 S.W.2d 657, 658–59 (Tex. App.—El
Paso 1991, no writ) (no error to grant permanent injunction by default without a
statement of facts because a permanent injunction is not a claim for unliquidated
damages); see also Dolgencorp of Tex., Inc. v. Lerma, 288 S.W.3d 922, 930 (Tex.
2009) (noting that a defendant’s failure to answer means the defendant admits all
facts properly pled in the petition). But here, the co-trustees answered with a
general denial, so Preston was required to offer evidence and prove all aspects of
his claim. See Dolgencorp, 288 S.W.3d at 930.3
In Preston’s second case, Snell v. Spectrum Association Management L.P.,
the San Antonio Court of Appeals held that a defendant who “affirmatively agreed
3
Moreover, this court has addressed overbreadth issues without requiring error
preservation. See Ron v. Ron, 604 S.W.3d 559, 577 & n.22 (Tex. App.—Houston [14th Dist.]
2020, no pet.) (noting that a party “does not waive its complaint to an overly broad temporary
injunction at the temporary injunction hearing” by not raising the argument in the trial court
(quoting Kaufmann v. Morales, 93 S.W.3d 650, 655 n.2 (Tex. App.—Houston [14th Dist.] 2002,
no pet.))).
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to the injunction” could not complain on appeal about the lack of an evidentiary
hearing for an anti-suit injunction. See No. 04-10-00285-CV, 2010 WL 3505139,
at *1, *4 (Tex. App.—San Antonio Sept. 8, 2010, no pet.) (mem. op.). But the
court held that a party who did not appear at the hearing and did not agree to the
temporary injunction could complain about the lack of an evidentiary hearing. See
id. at *3. Here, the co-trustees did not affirmatively agree to the injunction, so they
have not waived challenges to the legal or factual support for the trial court’s order.
C. Error to Issue Anti-Suit Injunction
The principle of comity requires that courts exercise the power to enjoin
foreign suits “sparingly, and only in very special circumstances.” Golden Rule Ins.
Co. v. Harper, 925 S.W.2d 649, 651 (Tex. 1996) (quoting Christensen v. Integrity
Ins. Co., 719 S.W.2d 161, 163 (Tex. 1986)). An anti-suit injunction may be
appropriate to (1) address a threat to the court’s jurisdiction, (2) prevent the
evasion of important public policy, (3) prevent a multiplicity of suits, or (4) protect
a party from vexatious or harassing litigation. Id. The party seeking the injunction
must show that a clear equity demands the injunction. Id. A single parallel
proceeding in a foreign forum does not constitute a multiplicity of suits, nor does it
by itself create a clear equity justifying an anti-suit injunction. Id.Here, the trial court found that the Louisiana lawsuit is a threat to its
jurisdiction and that Texas statutory probate courts are required to protect their
jurisdiction so their rulings will not be rendered nullities by competing litigation.
This finding is not supported by the law or evidence.
Preston notes that statutory probate courts have exclusive jurisdiction over
all probate proceedings. See Tex. Estates Code § 32.005(a). However, this case
and the Louisiana case involve inter vivos trusts, for which there is no exclusive
jurisdiction in the statutory probate court. See Tex. Estates Code § 32.007(a)(2)–
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(3). Preston relies on London Market Insurers v. American Home Assurance Co.,
95 S.W.3d 702 (Tex. App.—Corpus Christi 2003, no pet.), in which a divided
court of appeals upheld an anti-suit injunction when the first-filed suit was in
Texas and the other suit in New York involved insurance coverage issues under the
same policies. See id. at 707–08. The court held that there was evidence to
support the trial court’s finding that very special circumstances existed for an anti-
suit injunction because the insurers violated a service-of-suit clause by filing a
parallel proceeding in New York. See id. at 710; see also Am. Int’l Specialty Lines
Ins. Co. v. Triton Energy, Ltd., 52 S.W.3d 337, 341–43 (Tex. App.—Dallas 2001,
pet. dism’d w.o.j.) (special circumstances for anti-suit injunction existed because
second-filed suit violated service-of-suit provision of insurance policy).
Here, however, there is no special circumstance or clear equity to prevent a
Louisiana court from determining issues related to inter vivos trusts that are
governed by Louisiana law and that require the trustee to petition a Louisiana court
for instructions regarding any questions that might arise regarding their
administrations. Any suit in Louisiana by the co-trustees to determine the effect of
the Wyoming court’s rulings would apply only to the Harrier and Falcon trusts.
This single parallel proceeding brought by some of the co-trustees in Louisiana,
consistent with the trusts’ requirements that the co-trustees file suit in Louisiana,
cannot justify issuing an anti-suit injunction. See Golden Rule, 925 S.W.2d at
651–52. Even if there are overlapping or identical issues, the Louisiana suit does
not create a miscarriage of justice. See id.
Accordingly, the trial court erred to enjoin the co-trustees from litigating
matters related to the Harrier and Falcon trusts in any other court.
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D. No Evidence of Probable, Imminent, and Irreparable Injury
An injury is irreparable if the injured party cannot be adequately
compensated in damages or if the damages cannot be measured by any certain
pecuniary standard. Butnaru v. Ford Motor Co., 84 S.W.3d 198, 204 (Tex. 2002).
A party can rarely establish an irreparable injury and an inadequate legal remedy
when damages are available. See id. at 211. On the other hand, for example,
disputes over the right to purchase unique real property may justify a finding that
harm would be irreparable. See id.
Here, the trial court found that the Harrier Trust held assets that are unique
and irreplaceable. Preston adduced evidence that the trusts hold stock in Trof, Inc.,
which in turn holds units of Ribosome—a family limited partnership—which in
turn holds stock and membership units of Koch Industries, Inc. and Koch
Holdings, LLC. Preston testified that the assets held by the Harrier Trust are
unique and irreplaceable. Although the co-trustees had been paid sums certain
from the trust, those funds were deposited into the registry of the court in
Louisiana. Preston had no knowledge of any co-trustees transferring any assets of
the trusts. And there was no evidence that the co-trustees had taken any action or
planned to take any action to transfer, sell, or dispose of any unique and
irreplaceable assets of the trust. Elaine testified that the co-trustees had not made
any attempt to gain access to the Ribosome certificates. Under these
circumstances, a temporary injunction is not proper because the claimed injury to
unique assets is merely speculative; fear of injury is not sufficient. See Wash. DC
Party Shuttle, LLC v. IGuide Tours, 406 S.W.3d 723, 742 (Tex. App.—Houston
[14th Dist.] 2013, pet. denied) (en banc).
Moreover, Preston’s expert testified about the amount of fees that would be
owed to the co-trustees in the future and agreed that the fees were mathematically
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calculable and determinable by a pecuniary measure in simple terms. Preston
testified similarly that the fee could be mathematically calculated. Thus, any
injury based on payment of the fees alone is insufficient to support a temporary
injunction because damages are an adequate legal remedy. See Reach Group,
L.L.C. v. Angelina Group, 173 S.W.3d 834, 838 (Tex. App.—Houston [14th Dist.]
2005, no pet.).
The trial court also found that Preston had no adequate remedy because there
was “no evidence that the Co-Trustees can answer in damages.” This finding
reverses the burden of proof. To the extent Preston sought to establish that the co-
trustees were insolvent and thus could not satisfy a judgment, it was Preston’s
burden to adduce some evidence to support the claim. See Pharaoh Oil & Gas,
Inc. v. Ranchero Esperanza, Ltd., 343 S.W.3d 875, 884 (Tex. App.—El Paso 2011,
no pet.) (noting that an injury may be irreparable if the defendant is insolvent, but
reasoning that the burden was on the party seeking the injunction to prove
insolvency); cf. Wash. DC Party Shuttle, 406 S.W.3d at 742 (“[T]he burden is on
the applicant to prove that the damages cannot be calculated, not for the opposing
party to disprove the notion.”).
Preston’s authorities—cited for the proposition that a court may grant a
temporary injunction to stop the depletion of trust assets—are distinguished on
their facts. In Minexa Arizona, Inc. v. Staubauch, 667 S.W.2d 563 (Tex. App.—
Dallas 1984, no writ), the fiduciaries had improperly dissipated most of the funds
in a trust and engaged in various corporate transactions to transfer assets out of the
country, such that the funds were at risk of being unavailable to pay a judgment.
See id. at 567–68. In Twyman v. Twyman, No. 01-08-00904-CV, 2009 WL
2050979 (Tex. App.—Houston [1st Dist.] July 16, 2009, no pet.) (mem. op.), the
trustee withdrew money for her personal use and then executed an unsecured
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promissory note to the trust only after the plaintiff’s lawyers demanded an
accounting; and she failed to repay any money on the note and attempted to extend
the terms of the note. Id. at *5. The temporary injunction in Callahan v.
Lipscomb, 412 S.W.2d 346 (Tex. App.—San Antonio 1967, writ ref’d n.r.e),
related to unique assets, such as stock of a corporation that was formed out of
community property of the decedent, the corporation’s assets, and real and
personal property that stood to be inherited in a probate proceeding. See id. at
347–48.
Here, the only evidence about what the trustees had done with fees was that
they had placed the fees into a court’s registry to await a judicial determination.
And as discussed above, there is no evidence that unique assets of the trusts are in
imminent danger of being dissipated.
Accordingly, the trial court erred by enjoining the co-trustees from receiving
compensation and taking any actions that could affect the trusts’ assets.
III. CONCLUSION
The co-trustees’ third and fourth issues regarding the temporary injunction
are sustained. We do not reach other issues raised by the co-trustees and Elaine,
which are unnecessary to the disposition of the appeal. See Tex. R. App. 47.1.
The trial court’s order granting the temporary injunction is reversed, and we render
a judgment denying Preston’s application for a temporary injunction.
/s/ Ken Wise
Justice
Panel consists of Justices Wise, Jewell, and Poissant.
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