Herbert Franklin Garza v. State ( 2011 )

NO. 07-10-00205-CV
IN THE COURT OF APPEALS
FOR THE SEVENTH DISTRICT OF TEXAS
AT AMARILLO
PANEL A
AUGUST 15, 2011
HAROLD F. EGGERS, JR., APPELLANT
v.
JOHN TOWNES VAN ZANDT, II, WILLIAM VINCENT VAN
ZANDT, K. B. V. Z., A MINOR BY AND THROUGH HER
NEXT FRIEND JEANENE VAN ZANDT, JEANENE VAN
ZANDT, AND TVZ RECORDS, LLC, APPELLEES
FROM THE 345TH DISTRICT COURT OF TRAVIS COUNTY;
NO. D-1GN-06-01169; HONORABLE GISELA D. TRIANA-DOYAL, JUDGE
Before CAMPBELL and HANCOCK and PIRTLE, JJ.
MEMORANDUM OPINION
Appellant Harold F. Eggers, Jr. sought to proceed on appeal without advance
payment of costs by filing an affidavit of indigence. Appellees1 contested the affidavit
1
Eggers’ affidavit of indigence was challenged by the court reporter, LaDelle
Abilez, the plaintiffs in the underlying litigation John Townes Van Zandt, II, William
Vincent Van Zandt, Katie Belle Van Zandt, a minor, by and through her next friend
Jeanene Van Zandt, Jeanene Van Zandt, and third-party defendant TVZ Records, LLC.
Throughout this opinion the contestants of Eggers’ affidavit of indigence are collectively
identified as “appellees” and the plaintiffs in the underlying litigation are collectively
identified as “the Van Zandts.”
and the trial court sustained the contest. On Eggers’ appeal, we find the trial court did
not abuse its discretion by sustaining the contest, and will affirm its order.
Background
The Van Zandts sued Eggers for declaratory relief and damages on claims
arising from the ownership of rights to sound recordings of the late musician, John
Townes Van Zandt. The case was tried to a jury which found in favor of the Van
Zandts. The court signed a money judgment on December 15, 2009.2 Following the
completion of trial but before judgment, Eggers filed for relief under Chapter 13 of the
United States Bankruptcy Code.3 His Chapter 13 plan was confirmed by order of the
bankruptcy court.
Meanwhile, Eggers filed a notice of appeal of the December 2009 judgment in
the underlying case. He qualified for pro bono appellate representation by a volunteer
attorney through a program of the Appellate Law Section of the State Bar of Texas. At
the hearing on appellees’ contest, Eggers testified the estimated total cost of the
reporter’s record and the clerk’s record is $8,500. Egger’s pro bono counsel testified
neither he nor his firm agreed to advance or pay Eggers’ costs on appeal. The trial
court sustained the contest and Eggers challenges the order through this separate
2
The Van Zandts’ suit against Eggers bore trial court cause number D-1-GN-06-
00169 in the 345th District Court of Travis County. In this court, its appeal carries
appellate case number 07-10-0109-CV.
3
11 U.S.C. § 1301, et seq.
2
appeal. For this appeal, we ordered preparation of a record limited to the indigence
proceedings.4 Findings of fact and conclusions of law were not requested or filed.5
Analysis
Eggers presents one issue through which he argues the trial court abused its
discretion in sustaining appellees’ contest. In support, he specifically contends his
evidence of entitlement to veterans’ disability benefits was prima facie proof of
indigence which went unrebutted; his affidavit and hearing evidence established
indigence; and his qualification for pro bono representation through the volunteer
attorney program established indigence “as a matter of law.”
On appeal of an order sustaining a challenge to an affidavit of indigence, we
review the trial court’s ruling under the abuse of discretion standard. White v. Bayless,
40 S.W.3d 574, 576 (Tex.App.--San Antonio 2001, pet. denied). A trial court abuses its
discretion if it acts without reference to any guiding rules or principles; in other words,
we must decide whether the decision of the trial court was arbitrary or unreasonable.
Downer v. Aquamarine Operators, Inc., 701 S.W.2d 238, 241-42 (Tex. 1985).
4
An appellate court may on its own initiative apply Rules of Appellate Procedure
34.5(c)(1) and 34.6(d) to obtain preparation by the clerk and court reporter of the
portions of record necessary to review an order denying indigence status. In re Arroyo,
988 S.W.2d 737, 739 (Tex. 1998) (orig. proceeding); Kastner v. Texas Board of Law
Examiners, No. 03-08-00515-CV, 2009 Tex. App. Lexis 6381, at *3 n.5 (Tex.App.--
Austin August 12, 2009, no pet.) (mem. op.) (citing In re Arroyo); Tex. R. App. P. 34.5,
34.6.
5
The present appeal and the underlying case were transferred to this court from
the Third Court of Appeals by docket equalization order of the Supreme Court of Texas.
See Tex. Gov’t Code Ann. § 73.001 (West 2005).
3
“A party who cannot pay the costs in an appellate court may proceed without
advance payment of costs if the party files an affidavit of indigence in compliance with
[Rule of Appellate Procedure 20.1]; the claim of indigence is not contestable, is not
contested, or, if contested, the contest is not sustained by written order; and the party
timely files a notice of appeal.” Tex. R. App. P. 20.1(2). When a contest is filed, it is the
burden of the party filing an affidavit of indigence to prove the affidavit’s allegations.
Tex. R. App. P. 20.1(g). “The test for determining indigence is straightforward: Does the
record as a whole show by a preponderance of the evidence that the applicant would be
unable to pay the costs, or a part thereof, or give security therefor, if he really wanted to
and made a good-faith effort to do so?” Higgins v. Randall County Sheriff’s Office, 257
S.W.3d 684, 686 (Tex. 2008) (internal quotation marks omitted, citing Pinchback v.
Hockless, 139 Tex. 536, 539, 164 S.W.2d 19, 20 (Tex. 1942)).
Receipt of Veterans’ Disability Payments
Eggers testified he is a military veteran and has received veterans’ disability
benefits since 1972. His initial 10 percent permanent disability rating was later
increased to 50 percent. According to Eggers, he receives disability benefits for anxiety
and a retention disorder. He added that his retention capacity is “almost gone.”
Rule of Civil Procedure 145, governing affidavits of indigency in the trial courts,
defines a “party who is unable to afford costs” as “a person who is presently receiving a
governmental entitlement based on indigency or any other person who has no ability to
pay costs.” Tex. R. Civ. P. 145. In cases under former Rule 40 of the Rules of Appellate
Procedure, courts also found that indigence was demonstrated by a showing of
4
dependence on public assistance. See Griffin Indus. v. Thirteenth Court of Appeals,
934 S.W.2d 349, 351 (Tex. 1996). “The fact that any individual is dependent upon the
charity of the public afforded through the various welfare programs is, by itself, prima
facie evidence that the person is financially unable to pay the court costs or give
security therefor.” Id. (quoting Goffney v. Lowry, 554 S.W.2d 157, 159-60 (Tex. 1977)).
Recently, the Supreme Court of Texas has pointed out that the current appellate
procedure rule on indigency in civil cases, Rule 20.1, “does not contain the broad
definition found in Civil Rule 145.” In re C.H.C., 331 S.W.3d 426, 430 n.7 (Tex. 2011).
The court went on to state that the case before it did not require a determination
“whether the standard mentioned in Griffin and present in Civil Rule 145 also applies to
our new Appellate Rule 20.1.” Id.
A claim for veterans’ disability benefits requires establishment of five elements:
(1) veteran status; (2) existence of a disability; (3) service connection of the disability;
(4) degree of disability; and (5) effective date of the disability. Maggitt v. West, 202 F.3d
1370, 1375 (Fed. Cir. 2000); see 38 U.S.C.A. § 1110 (West 2002) (setting forth the
basic requirements for compensation for a disability resulting from active military service
during a period of war); 38 U.S.C.A. § 1131 (West 2002) (setting forth the basic
requirements for a disability resulting from active military service during other than a
period of war). The veteran must have been “discharged or released under conditions
other than dishonorable.” 38 U.S.C.A. § 1110; 38 U.S.C.A. § 1131.
For demonstrating indigence based on receipt of public assistance or charity, we
find a material distinction between dependence on a public charity and dependence on
5
disability benefits. Receipt of need-based public assistance means the party asserting
indigence on appeal has met the qualifying standard of a government agency or
program for receipt of need-based benefits. Cf. Tex. R. App. P. 20.1(a)(1) (affidavit of
party meeting rule’s criteria, including screening and rescreening by designated
programs, may not be contested). Civil Rule 145 speaks of “governmental entitlement
based on indigency.” Tex. R. Civ. P. 145. Entitlement to veterans’ disability benefits is
not based on the applicant’s indigency.
Assuming the standard previously noted in Griffin and Rule of Civil Procedure
145 also applies to Rule of Appellate Procedure 20.1, a question we also need not
address, we conclude Eggers did not make prima facie proof of indigence merely by
proving his receipt of veterans’ disability benefits.
Proof of Indigence by Affidavit and Hearing Evidence
At the hearing on appellees’ contest, Eggers presented evidence of his financial
condition. His veterans’ disability payment amounts to $770 per month. He also earns
$150 per week straightening displays for an Austin newspaper. For nine weeks during
2009, he did “computer work” for an individual. He was terminated from this position,
however, as he was unable to perform the work. Between the computer work and his
newspaper position, Eggers earned $6,600 in 2009. At the conclusion of the hearing,
Eggers was permitted to address the court. In his narrative, among other things Eggers
explained, “I’m in the music business. We work on spec.” He added that he makes
“record deals” which require three years to complete.
6
Eggers owns a condominium, free of encumbrance, which he valued at $63,000.
He testified this property was originally purchased with proceeds of a loan made by his
parents and was at times titled to his parents or his sister to prevent him from selling or
encumbrancing the dwelling. Eggers owns a 2003 Toyota Matrix automobile. The
vehicle has been driven 130,000 miles and requires repairs he said would cost in the
“range of two thousand dollars.” He also expressed the opinions his assets6 are “really
not worth anything,” and any attempted sale would require approval of the bankruptcy
court. Eggers testified his monthly income is $1,370.
Eggers’ affidavit listed monthly expenses totaling some $1325. Additionally,
Eggers’ monthly plan payment in bankruptcy is $201.88. At the time of the hearing,
Eggers had not been ordered to make regularly scheduled child support payments for
his minor son nor did he voluntarily make such payments.
Eggers’ bankruptcy schedules were appended to his affidavit of indigence.
There, he itemized his personal property and valued it collectively at $33,556.17. He
listed “accounts receivable” described as “[m]onies owed by TVZ records” as a property
item. He valued the receivables at $15,269.7 Eggers listed a “50% interest in
copyrights to Townes Van Zandt recordings[,] Townes Van Zandt CD documentary [,
and] Richard Dobson CD--Mankind.” According to the schedule, Eggers does not have
6
Apparently, excluding his condominium.
7
Also in a bankruptcy schedule, Eggers identified “Jeanene Van Zandt, et al”
(sic) as creditors of a disputed $300,000 claim partially collateralized by monies
($15,269.17) owed him by TVZ Records. According to the judgment in the main case,
the trial court “made no determination concerning any offset or recoupment issues, and
the Parties are free to seek disposition of these issues in [Eggers’] bankruptcy
proceeding.”
7
an appraisal of these assets but values them at $1,000. Eggers listed an interest in
“Donovan/Eggers Music,” with the explanation “no present income,” and an interest in a
book valued at “$200/year for 10 years/$100 year for 20 years.” Eggers values these
two assets at $2,000 apiece although he testified neither is “worth anything” and the
book “had already had its day.”
There was no evidence Eggers attempted to raise cash from his personal
property for payment of the reporter’s record. While the overarching fact that Eggers is
a Chapter 13 debtor sounds generally synonymous with insolvency, specific facts
demonstrating how his Chapter 13 plan could stymie an effort to generate funds for
payment of the record, either by asset liquidation or obtaining credit, were not presented
to the trial court. Along with Eggers’ testimony attributing little or no value to his
business assets, the trial court also was faced with his bankruptcy schedules in which
he swore to the values we have noted.
As appellees point out, Eggers owns a condominium and personal property he
valued in excess of $33,000. Even with his Chapter 13 plan payment, Eggers presents
a positive monthly cash flow and offered no proof why some of his monthly expenses
could not be further reduced. Cf. Morris v. Aguilar, No. 03-08-0078-CV, 2010 Tex. App.
Lexis 5365, at *9-*11 (Tex.App.--Austin July 9, 2010, pet. filed) (questioning why
appellant and her husband could not further reduce expenses, including some related to
husband’s deafness, and holding trial court did not abuse its discretion in denying free
record on appeal even though appellant presented a negative monthly cash flow).
8
The trial court was the sole judge of the credibility of the witnesses and the
weight assigned their testimony. In re T.E.G., 222 S.W.3d 677, 679 (Tex.App.--
Eastland 2007, no pet.) (citing City of Keller v. Wilson, 168 S.W.3d 802, 821-28 (Tex.
2005)). There is no abuse of discretion if the trial court bases its decision on conflicting
evidence and, as here, some evidence supports its decision. In re Barber, 982 S.W.2d
364, 366 (Tex. 1998) (orig. proceeding). And we may not reverse the trial court’s
decision simply because we might have reached a different result. Downer, 701 S.W.2d
at 242. We are unable to see an abuse of discretion in the trial court’s evaluation of the
evidence before it. Tex. R. App. P. 20.1(g); Higgins, 257 S.W.3d at 686.
Participation in Pro Bono Program
Finally, Eggers asserts because he is represented by pro bono counsel as part of
the State Bar of Texas Appellate Section’s pro bono program he is entitled to a free
record as a matter of law. Eggers concedes, however, this is not the law. He
nevertheless asks that we extend the law so that he is accommodated.
The website of the Appellate Section indicates it sponsors a pro bono pilot
program in the Third Court of Appeals. See http://www.tex-app.org/probono.php.
According to the Third Court of Appeals’ Pro Bono Pilot Program Pamphlet (09/01/07)
(available at: http://www.tex-app.org/pamphlet), the program’s goal “is to match clients
who are financially unable to obtain legal representation with volunteer lawyers who
agree to serve without expectation of compensation for their service.” A party with
retained counsel in the trial court may qualify for the program if he can no longer afford
an attorney. A “significant factor” in qualifying a program applicant is his ability to pay
9
for legal services although the screening committee considers such other factors as
current program case volume, the number of available volunteer attorneys, and issues
presented by the appeal. The screening committee applies 175% of the poverty
guidelines published by the United States Department of Health and Human Services
as a benchmark for determining whether an applicant qualifies for free legal services.
Of these facts concerning the pilot program, we take judicial notice on our own initiative.
See Tex. R. Evid. 201(b)(2), (c), (f) (at any stage of proceeding, court in its discretion
and on its own motion can take judicial notice of facts capable of accurate and ready
determination by resort to sources whose accuracy cannot reasonably be questioned).
Rule of Appellate Procedure 20.1 provides in part:
If the appellant proceeded in the trial court without advance payment of
costs pursuant to a certificate under Texas Rule of Civil Procedure 145(c)
confirming that the appellant was screened for eligibility to receive free
legal services under income guidelines used by a program funded by
Interest on Lawyers Trust Accounts or the Texas Access to Justice
Foundation, an additional certificate may be filed in the appellate court
confirming that the appellant was rescreened after rendition of the trial
court's judgment and again found eligible under program guidelines. A
party’s affidavit of inability accompanied by the certificate may not be
contested.
Tex. R. App. P. 20.1(a)(1). The record contains no indication Eggers proceeded in the
trial court without advance payment of costs under a Rule of Civil Procedure 145(c)
certificate. There is also no indication the program through which Eggers was matched
with his appellate counsel is an Interest on Lawyers Trust Accounts program or Texas
Access to Justice Foundation program. As is apparent, factors beyond poverty may
favor an applicant’s acceptance by the pilot program. And we are not shown that the
10
income guidelines applied by the pilot program mirror those of the programs Rule
20.1(a)(1) specifies. We conclude it is not possible to bring the pro bono appellate
representation the pilot program is providing Eggers within the ambit of Rule 20.1(a)(1).8
In that regard, and especially considering that Eggers’ appeal originated in the
Third Court of Appeals, we take note of that court’s opinion in Morris, 2010 Tex. App.
Lexis 5365. While the effect of participation in the Third Court of Appeals’ pro bono pilot
program was not at issue in Morris, the appellant there testified that she and her
husband qualified for the program; yet, the appellate court affirmed the trial court’s order
sustaining the court reporter’s contest of the appellant’s affidavit of indigence. Morris,
2010 Tex. App. Lexis 5365, at *7, *11.
While we commend counsel’s willingness to provide pro bono legal services for
Eggers, and find the Appellate Section’s pilot pro bono program laudable, we are not
authorized to stretch the bounds of Rule 20.1(a)(1) to include it.
Finding none of Eggers’ appellate contentions persuasive, we overrule his sole
issue on appeal.
8
Rule of Appellate Procedure 2 authorizes us on motion or our own initiative to
suspend a rule’s operation in a particular case and order a different procedure, “to
expedite a decision or for other good cause.” Tex. R. App. P. 2. We will not invoke
Rule 2 here.
11
Conclusion
Because we find the trial court did not abuse its discretion in sustaining
appellees’ contest of Eggers’ affidavit of indigence and Eggers is not otherwise entitled
to a free record on appeal, we affirm the trial court’s order.
James T. Campbell
Justice
12