With today’s order list, the Texas Supreme Court granted four new cases to be heard in the fall and, at the same time, resolved three cases from its pending docket.

The order list also included an interesting (dissenting) opinion on a “motion to clarify” one of the Court’s previously decided cases. The question involved how the punitive damages cap is to be applied by a lower court after the Court reduces the compensatory damages.

Today’s Merits Decisions

• Pastor Rick Barr and Philemon Homes, Inc. v. City of Sinton, No. 06-0074 (Hecht, J.) (DocketDB) The Court decided a case under the Texas Religious Freedom Restoration Act, finding that a religious ministry aimed at prisoners had been discriminated against by a local zoning ordinance.

• Nabors Drilling, U.S.A., Inc. v. Francica Escoto, et al., No. 06-0890 (Green, J.) (DocketDB) The Court refuses to place a tort duty on employers “whose work conditions may contribute to fatigue in an off-duty employee.” In this case, the employee got into a traffic accident while driving home. Had the employee been drunk instead of merely tired, Texas tort law would have imposed a duty on the employer.

  Although the Court said the risk that fatigued employees pose to other motorists when driving home was “generally known,” it declined to hold the employer responsible based on its assessment of the public policies involved in recognizing a tort duty. The Court also refused to place a tort duty on the employer to educate its employees about the dangers of driving while fatigued.

• City of DeSoto, Texas v. Justin White, No. 07-1031 (Green, J.) (DocketDB) This case concerns the appeals process given to a suspended police officer.

  “If the officer appeals to a hearing examiner, his ability to seek further review in a district court is severely limited. The suspended police officer in this case elected to appeal to a hearing examiner, but the City failed to inform him of the appeal limitation, as it was required to do by statute.” The Texas Supreme Court holds that this procedural error did not deprive the hearing examiner of jurisdiction to dispose of the police officer’s appeal.

Should Punitive Damages Be Reduced on Remand When the Court Reduces the Economic Damages?

Columbia Medical Center of Las Colinas, Inc v. Athena Hogue, et al., No. 04-0575 (Wainwright, J., dissenting) (DocketDB)

The Court decided this case last August and (after resolving a motion for rehearing) issued its formal mandate along with a corrected opinion in January, passing control of the case back to the lower courts.

With today’s order list, the Court resolves a “motion to clarify” that appellate mandate with regard to the punitive damages cap.

The Court struck down part (but not all) of the compensatory damages. “No party raised an issue with the calculation of the punitive damages cap during this appeal…”

Through this “motion to clarify,” Columbia Medical asks the Texas Supreme Court to state that its original mandate required the trial court to recalculate punitive damages to reflect that new, lower level of compensatory damages.

Today, the Court declined the motion without an opinion of the Court. But three Justices (( Justice Wainwright wrote the dissent and was joined by Justice Hecht and Justice Brister. )) joined in a dissenting opinion vehemently arguing that the punitive damages should be reduced — and that the Court’s denial of the motion “should not be read as a rejection of Columbia Medical’s position”:

Here, there is only one answer to the legal issue, and the Court’s denial of the motion to clarify should not be read as a rejection of Columbia Medical’s position. When the Court reverses a portion of economic damages that form the basis of the cap on punitive damages, it is elementary that the cap must be recalculated and reduced to account for the change. It is also elementary that a reduction in compensatory damages on appeal requires, for example, the parties to recalculate the apportionment of damages among defendants, to reconsider settlement credits, and to recalculate post-judgment interest. We should not need to expend time on such matters, but when necessary, we should answer the question and settle the dispute. Because denying the motion to clarify will likely embroil the parties in further litigation, when this Court has jurisdiction to put an end to the dispute easily, I respectfully dissent from the denial of the motion to clarify.

That the Court’s denial of a motion does not, technically, reach the merits is almost always true. But, in the context of an appellate mandate, this is particularly interesting. (( The “appellate mandate” is the formal document embodying an appellate court’s judgment sent to lower courts. When a lower court goes outside the bounds of that command, a motion or petition can be filed to “enforce” that mandate. But, if you’re reading the footnotes on this blog, you probably knew that already. ))

What lower court would want to step outside a direct command from the Texas Supreme Court? Here, the lower court now has three Justices on the record saying that one answer is “elementary.” But no one knows how the other six Justices feel about the same substantive question.

This outcome also leaves appellate practitioners in doubt about what steps are necessary to preserve error in similar cases involving a punitive damages cap.

Mold Damages on the Docket

State Farm Lloyds and Erin Strachan v. Wanda M. Page, No. 08-0799 (DocketDB) This petition asks if a standard Texas homeowners policy covers damage caused by mold.

Medical Malpractice Expert Reports

Eberhard Samlowski, M.D. v. Carol Wooten, No. 08-0667 (DocketDB) This is yet another petition about what is required for a medical-malpractice plaintiff’s expert report to avoid dismissal. This case asks if a particular report represented a good enough first effort to require the trial court to grant a 30-day extension of time to file a better report. Here, the trial court declined to grant the extension, and the court of appeals reversed.

Energy Prices

The Court also granted two cases involving regulated energy prices:

State of Texas v. Public Utility Commission, No. 08-0421 (3 petitions) (DocketDB)

Texas Industrial Energy Consumers v. Centerpoint Energy Houston Electric, LLC and Public Utility Commission of Texas, No. 08-0727 (2 petitions) (DocketDB)

With this week’s order list, the Texas Supreme Court issued opinions in two mandamus cases.

My two case summaries are being posted separately.

The Court issued opinions in six cases with today’s order list, granted another petition for review for future oral argument, and invited the Solicitor General to file a brief in a pending case. The Court also denied rehearing in Entergy.

Today’s opinions were in:

• Columbia Rio Grande Healthcare, L.P. v. Hawley, No. 06-0372 (Johnson, J.) (DocketDB)

• In re Lester Collins, M.D., No. 07-0737 (O’Neill, J.) (DocketDB)

• Harrell v. State of Texas, No. 07‑0806 (Willett, J.) (DocketDB)

• Ditta v. Conte, No. 07‑1026 (Willett, J.) (DocketDB)

• Timpte Industries v. Gish, No. 08‑0043 (Medina, J.) (DocketDB)

• In re E.A. and D.A., No. 08‑0157 (Jefferson, C.J.) (Justice Brister wrote a concurrence for three Justices) (DocketDB).

Case summaries to follow.

Entergy Rehearing Denied

The statutory interpretation case everyone loves to hate now appears to be over. With today’s order list, the Court denied the pending motion for rehearing in Entergy Gulf States, Inc. v. Summers, No. 05-0272 (DocketDB).

Petition Granted

The Court granted the petition for review in Kelly v. General Interior Construction, Inc., No. 08-0669 (DocketDB), a case about personal jurisdiction over corporate officers who travel to the state in that capacity.

CVSG

And the Court requested the views of the solicitor general in City of Dallas v. VSC, LLC, No. 08-0265 (DocketDB). The court of appeals opinion explains the circumstances. The city took possession of certain cars held by a towing company, arguing that it had the right to seize those cars under other law (such as the use of a car in a felony). The towing company asserted a takings claim. The city responded that it was not exercising its eminent domain powers but rather other sources of law.

The Dallas Court sided with the towing company. A petition for review was filed, and full briefing on the merits was completed in March. Now the Texas Supreme Court has asked the State to weigh in, through the Office of the Solicitor General.

In this holiday-shortened week, the Texas Supreme Court’s order list was fairly quiet. The Court did not issue any opinions or select any new cases for argument.

With today’s order list, The Texas Supreme Court issued opinions in three new cases and granted rehearing to issue a substituted opinion in another. No new petitions were chosen for the fall argument calendar.

Today’s opinions involve a significant question about how to bring shareholder derivative suits in Texas (including a procedural holding relevant to many other mandamus cases), state liability for loose gravel on the roadways, and tort liability for jailhouse suicides.

My case summaries follow the break.

Read the case summaries

With today’s order list, the Texas Supreme Court issued opinions in three pending cases, granted rehearing in a petition that will be heard this fall, and also formally accepted the Fifth Circuit’s certified question in Severance v. Patterson case about the constitutionality of the Texas Open Beaches Act.

Sanctions in medical-malpractice suit even after nonsuit

Frances B. Crites, M.D. v. Linda Collins and Willie Collins, No. 07-0315 (per curiam) (DB)

After filing a medical-malpractice claim, the plaintiff missed the 120-day deadline for filing an expert report and then filed a voluntary nonsuit. Immediately after, the doctor filed a motion for sanctions under the statute. The trial court formally granted the nonsuit and then, later, denied the motions for sanctions after holding a hearing.

The doctor appealed the trial court’s decision to deny sanctions. The court of appeals affirmed, but did so on procedural grounds. It concluded that the nonsuit prevented the doctor from later asking for sanctions.

Today, the Texas Supreme Court reversed, holding that there was no procedural bar to a doctor asking for sanctions even after a non-suit. The Court noted that, if anything, the revisions to the statute in 2003 seemed to take away the plaintiff’s option to file a nonsuit without penalty.

The case has a few procedural wrinkles likely to interest appellate lawyers. I’ll have a short post about those later today (time permitting) or this weekend.

Damages in condemnation cases

State of Texas v. Bristol Hotel Asset Co., No. 07‑0896 (per curiam) (DB)

This condemnation case looked again at two of the categories of damages that have generally not been available — (1) temporary damages to a business caused by the inconvenience of the construction and (2) loss of property value due to diminished access to the remaining portions of a landowner’s property after part is taken.

The Court ultimately reversed the judgment and remanded for a new trial on damages, concluding that the landowner’s expert had improperly based his analysis on those improper factors.

First, the Court found that the expert had included temporary damages for the landowner’s inability to use some of its parking spaces during the construction. “We have held that lost profits or injury to a business are not compensable over and above the value of the land taken and the diminution in the value of the remainder tract.”

The expert had cleverly tried to include these temporary damages as within the “market value” of the remainder property by arguing that an immediate buyer would discount the property value to take into account the ongoing construction project. The Court rejected that attempt:

Whether treated as a separate item of temporary lost business revenues or profits, or as part of the calculation of fair market value of the remainder property, Bristol asked the jury to include in its assessment of damages the partial, temporary loss of parking spaces, a loss that is not compensable as a matter of law.

Second, the Court found that the expert had improperly included damages for diminished access to the remainder of the property. This error was more subtle. Instead of outright including an amount for these damages, the expert included this as one factor in choosing a “discount rate” for the property as a real estate investment.

The expert reasoned that the remainder of the property would be seen by potential buyers as a riskier investment, in part because of the diminished access. And, because the property would be seen as riskier, the expert concluded that “the discount or capitalization rate used in the present value calculation under the income approach should be increased to reflect a higher degree of risk that potential investors would perceive as a result of the condemnation.”

The Court held that this improper element of damages, which could not be included as a separate line item, also could not be quietly folded into the “discount rate” used in the formula.

Executors are not disqualified merely because of a good-faith dispute over their share of the estate

John Kappus v. Sandra L. Kappus, No. 08‑0136 (DB)

The opinion for a unanimous Court was written by Justice Willett. It begins:

This appeal concerns whether an independent executor’s alleged conflict of interest—here, a good-faith dispute over the executor’s percentage ownership of estate assets—requires his removal as a matter of law. Probate Code section 149C lists several grounds for removing an executor, but “conflict of interest” (either actual or potential) is not among them, and we refuse to engraft such a test onto the statute. Accordingly, as none of the conditions for removal under section 149C were met in this case, we reverse the court of appeals’ judgment and reinstate the trial court’s order denying the motion to remove.

The Court rejected arguments that an alleged conflict of interest with the executor would require their removal under Probate Code 149C(a)(2) regarding whether assets have been “misapplied or embezzled”; under Probate Code 149C(a)(5) regarding “Gross Misconduct or Gross Mismanagement”; or under Probate Code 149C(a)(6) regarding “legally incapacity.”

The opinion explains that having such a broad disqualification rule would not only depart from the statute but also “frustrate the testator’s choice of executor (particularly the common practice of appointing spouse-executors)” and would “impede the broader goal of supporting the independent administration of estates with minimal costs and court supervision.”

Certified Question Accepted

With today’s order list, the Court formally accepted the Fifth Circuit’s certified question in Severance v. Patterson, No. 09-0387 (DB). That means the case will be heard for argument after a new round of briefing is complete. (The Court’s order notes that Chief Justice Jefferson will not be sitting on this case.)

That case was discussed in more detail in this previous post.

Rehearing Granted

The Court also granted rehearing in Zachry Construction Corp. v. Texas A&M University, No. 07-1050 (DB), a case in which the Court originally denied review in January. The case asks if parties with sovereign immunity can nonetheless be treated as responsible third-parties in tort suits involving others.

No date for this argument has been set. (The Court’s order notes that Justice Willett will not be sitting on this case.)

This week’s order list did not bring any opinions in pending cases or new grants of review.

With today’s order list, the Court:

• issued merits opinions in seven cases (discussed below), including a toxic torts-based takings claim against a city, an important case about seeking injunctive relief against state officials, a case between two governmental hospital districts, a premises-liability case involving a floodgate, how res judicata might affect a divorce decree, and two cases about what formalities are needed to preserve an appellate point (in a family-law case and in a prison-inmate case);

• granted the petition for review in In re B.G., C.W., E.W., B.B.W., and J.W., No. 07‑0960 (DB), a case about when a party to a parental-termination case is entitled to a free record on appeal; and

• granted the motion for rehearing in Texas Parks and Wildlife v. The Sawyer Trust, No. 07‑0945 (DB), restoring that previously denied petition to the docket.

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