Mabon Ltd. v. Afri-Carib Enterprises, Inc.
369 S.W.3d 809
| Tex. | 2012Background
- Afri-Carib sued Mabon in 1996 for breach of contract; Mabon had no Texas office for service, so service was by Texas Secretary of State.
- Mabon’s defense counsel received notice of trial setting, but failed to relay it to Mabon; neither appeared at trial, resulting in a September 1998 default judgment against Mabon.
- Mabon’s attorney was later revealed to be suspended; Mabon learned of the default only in early 1999 amid collection efforts.
- Mabon timely pursued remedies (restricted appeal, then bill of review); trial court found no notice of trial or default judgment and concluded no need to prove the first two bill-of-review elements.
- Courts below held Mabon lacked diligence in monitoring the case status; appellate court remanded for diligence determination, while the Supreme Court reviews the standard for diligence in the bill-of-review context.
- This Court ultimately grants review, overturns the appellate decision, and reinstates the trial court judgment in favor of Mabon.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether lack of notice alone excises the need to prove traditional bill elements | Mabon lacked notice and thus should fail no elements | Afri-Carib argues diligence still required | No; lacking notice relieves traditional burden |
| Whether no notice of trial/default judgment satisfies due process | Due process requires notice after appearance; here none | Not contested on appeal | Yes; due process satisfied due to absence of notice |
| Whether diligence in monitoring case status is required where a lawyer represents the party | No duty to monitor after retaining counsel | Mabon should show diligence to monitor status | No; diligence in monitoring not required when represented and no notice |
| Whether the court should remand or decide law on diligence | Court should decide as a matter of law | Remand to determine diligence is appropriate | Grant review; reverse appellate remand and decide law on diligence |
| What standard governs bill of review when there is no notice of trial or judgment | Traditional three elements must be proven | Lack of notice eliminates first two elements | First two elements excused; lack of negligence conclusively established |
Key Cases Cited
- Peralta v. Heights Med. Ctr., Inc., 485 U.S. 80 (U.S. 1988) (due process requires notice to avoid infirm judgment)
- Caldwell II, 154 S.W.3d 93 (Tex. 2004) (bill of review elements except where no notice)
- Lopez v. Lopez, 757 S.W.2d 721 (Tex. 1988) (per curiam; unsupported by notice affects bill-of-review)
- LBL Oil Co. v. Int’l Power Servs., Inc., 777 S.W.2d 390 (Tex. 1989) (no notice of trial setting constitutes due process issue)
- Wembley Inv. Co. v. Herrera, 11 S.W.3d 924 (Tex. 1999) (due diligence concept in pursuit of remedies without fault)
- Caldwell I, 975 S.W.2d 535 (Tex. 1998) (nearly two-year delay may be excused in diligence analysis)
- Campus Invs., Inc. v. Cullever, 144 S.W.3d 464 (Tex. 2004) (addressing service-notice and diligence in bill of review context)
- Gold v. Gold, 145 S.W.3d 212 (Tex. 2004) (negligence in not seeking reinstatement or appeal affects diligence)