523 S.W.3d 299
Tex. App.2017Background
- After Richard Buck Aubrey died (2004), his will created the Aubrey Family Trust naming his spouse Betsy as trustee and providing that net trust income be distributed to her during her life; the three sons are remaindermen.
- Steven B. Aubrey (appellant), proceeding pro se, sued (Sept. 2015) to remove Betsy as trustee alleging breach of fiduciary duty, self-dealing, and fraudulent transfers (notably a 2013 Travis County property transfer).
- Betsy filed a combined motion (Dec. 2015) to declare Steven a vexatious litigant under Tex. Civ. Prac. & Rem. Code ch. 11 and sought Chapter 10 sanctions (attorney’s fees) of $350,000 (later argued and awarded as $250,000).
- The trial court (Feb. 2016) found Steven a vexatious litigant, ordered him to post $150,000 security (failure to post led to dismissal with prejudice), and entered sanctions against him of $250,000; a Final Judgment Nunc Pro Tunc incorporated those orders. Steven appealed.
- The appellate court reviewed standing and statutory standards for vexatious-litigant and Chapter 10 sanctions, concluding Steven had statutory standing as an “interested person” to seek trustee removal but that the vexatious-litigant finding and some sanction findings were supported by evidence.
Issues
| Issue | Plaintiff's Argument (Aubrey) | Defendant's Argument (Betsy) | Held |
|---|---|---|---|
| 1. Standing to sue for removal of trustee | Aubrey: as a beneficiary/"interested person" under the Trust Code he can seek trustee removal; contingent interest is irrelevant | Betsy: Aubrey is only a contingent remainderman; his interest is too remote to confer standing for this action | Held: Court reversed trial court's conclusion that Aubrey lacked standing — Aubrey is an "interested person" under Tex. Prop. Code §§111.004,113.082 and may sue to remove trustee |
| 2. Whether there is a reasonable probability Aubrey will prevail (prong of vexatious-litigant test) | Aubrey: evidence (deposition, transaction allegations) supports claims of self-dealing and breach; he can prevail | Betsy: declarations and documents show no impropriety (transfers had consideration, income flows to Betsy), so Aubrey cannot prevail | Held: Court affirmed trial court — record contains evidence (CPA/declarations, transaction explanations) supporting conclusion there is not a reasonable probability Aubrey will prevail |
| 3. Whether Aubrey filed ≥5 pro se actions in prior 7 years finally determined adversely to him (vexatious-litigant statutory prong) | Aubrey: some prior rulings and a Travis County denial of a vexatious-litigant motion preclude counting certain cases; some counts were fabricated/split | Betsy: Aubrey filed many pro se suits (recorded 13), and at least five were finally determined adversely | Held: Court affirmed trial court — sufficient prior pro se adverse determinations existed to satisfy Tex. Civ. Prac. & Rem. Code §11.054(1)(A) |
| 4. Appropriateness and amount of Chapter 10 sanctions (signing pleadings in bad faith) | Aubrey: sanctions ($250k; argued as $500k) are excessive, ex parte, and include fees from other cases not authorized by Chapter 10 | Betsy: pleadings were frivolous/harassing; $250k is reasonable given cumulative defense costs across similar lawsuits | Held: Court held Chapter 10 sanctions were warranted (bad-faith filings) but reversed as to amount — trial court abused discretion by awarding $250,000 based on fees from multiple other lawsuits not authorized by Chapter 10 and remanded to determine a proper amount |
Key Cases Cited
- Harris v. Rose, 204 S.W.3d 903 (Tex. App.—Dallas 2006) (standard: vexatious-litigant determinations reviewed for abuse of discretion)
- Rossmann v. Bishop Colo. Retail Plaza, L.P., 455 S.W.3d 797 (Tex. App.—Dallas 2015) (when no findings requested, appellate court implies supporting facts and affirms if any legal theory fits)
- Weisfield v. Tex. Land Fin. Co., 162 S.W.3d 379 (Tex. App.—Dallas 2005) (same rule on implied facts supporting judgment)
- Nath v. Texas Children’s Hosp., 446 S.W.3d 355 (Tex. 2014) (abuse-of-discretion standard for sanctions review)
- Low v. Henry, 221 S.W.3d 609 (Tex. 2007) (sanctions must have direct nexus to improper conduct; presumption of good faith in filings)
- Mazon Assocs., Inc. v. Comerica Bank, 195 S.W.3d 800 (Tex. App.—Dallas 2006) (standing depends on facts pleaded and cause of action asserted)
- Yturri v. Yturri, 504 S.W.2d 809 (Tex. App.—San Antonio 1973) (remainderman may have sufficient interest to seek trustee removal)
- Law Offices of Windle Turley, P.C. v. French, 164 S.W.3d 487 (Tex. App.—Dallas 2005) (trial court may sanction duplicative or harassing filings; sanction scope analyzed case-by-case)