Mateo Cortez, as Representative of the Estate of Deborah Cortez v. Sandra Flesher Brown, Charlotte Flesher Ash, Charlene Flesher Johnston, Connie Lou Keith Barry, Randall Wayne Davis, Virginia Villers, Charles Roberts, Lisa A. Smith, Patricia Chapman, Betty J. Marks Webb, James Berl Marks, Linda Murray
03-17-00365-CV
| Tex. App. | Jan 5, 2018Background
- Mateo Cortez (petitioner) is husband of Deborah Cortez; William and Phyllis Short created a trust that provided for Deborah for life, then directed remaining assets to the heirs at law of William and Phyllis Short.
- Trustee Linda Murray (and respondent Connie Barry as interested heir) sued in Wirt County, WV, to obtain a judicial declaration directing final distribution of trust assets located and administered in West Virginia.
- Trustee separately sued Cortez in Texas probate court for torts (conversion/theft) seeking money damages after alleged misappropriation of trust funds; Cortez intervened in Texas seeking an ownership/declaratory claim to the trust assets.
- WV circuit court granted partial and then final summary judgment holding Cortez (individually and as representative of Deborah’s estate) is not a beneficiary; Cortez filed multiple motions, removal to federal court, and appeals; Texas probate court also ruled Cortez had no claim and sanctioned his Texas counsel.
- Primary disputes on appeal: (1) whether Cortez has any beneficial interest in the trust; (2) whether the Texas probate judgment is res judicata / entitled to full faith and credit; (3) whether Princess Lida/quasi in rem doctrine or comity/ forum non conveniens required dismissal or stay of WV proceedings; and (4) whether intervention as the Estate of Deborah was timely/appropriate.
Issues
| Issue | Plaintiff's Argument (Cortez) | Defendant's Argument (Barry/Trustee) | Held |
|---|---|---|---|
| Beneficiary status: Is Cortez (or the Estate of Deborah) a beneficiary of the Trust? | Trust language and related instruments allegedly vested in Deborah or her estate, making Cortez (as sole heir) entitled to trust corpus. | Trust is unambiguous: Deborah had only a life interest; on her death the remainder goes to the heirs at law of Mr. and Mrs. Short; Cortez is not an heir at law. | Court upheld summary judgment: Cortez has no beneficial interest. |
| Res judicata / full faith and credit: Does the Texas probate judgment bar Cortez’s claims here? | Appeal pending in Texas so judgment should not operate to bar WV proceedings. | Texas probate court entered final judgment dismissing Cortez’s claims; under Texas law that judgment is final for preclusion and warrants full faith and credit. | Texas judgment is entitled to full faith and credit and bars Cortez’s claims to the trust. |
| Jurisdiction / Princess Lida: Did parallel Texas proceedings oust WV court under Princess Lida (exclusive in rem/quasi in rem jurisdiction)? | Cortez argues Texas was exercising control over the trust and thus WV suit should be dismissed or stayed. | Trustee’s Texas case was an in personam tort action for money damages; Cortez’s defensive intervention was declaratory/in personam; Princess Lida applies only where courts must control the res. | Princess Lida inapplicable; WV proceedings may proceed because Texas action was in personam and did not administer the trust. |
| Intervention/timeliness: Could Cortez (as Estate of Deborah) intervene under Rule 24 or Rule 19? | Estate of Deborah moved to intervene to protect interests asserted post-judgment. | Motion to intervene was untimely; the Estate had no protectable remainder interest (Deborah’s life interest expired); Cortez already adequately represented the Estate; intervention was properly denied. | Intervention denied as untimely and unnecessary; estate had no interest to protect and was adequately represented. |
Key Cases Cited
- Princess Lida of Thurn & Taxis v. Thompson, 305 U.S. 456 (1939) (narrow doctrine limiting concurrent jurisdiction where courts must control the res; does not apply to ordinary in personam claims)
- Kline v. Burke Const. Co., 260 U.S. 226 (1922) (concurrent actions in different courts may proceed until a judgment becomes res judicata)
- Commonwealth Trust Co. of Pittsburgh v. Bradford, 297 U.S. 613 (1936) (distinguishes in personam declaratory claims about an individual’s share from in rem administration)
- Hemphill v. Aukamp, 164 W. Va. 368, 264 S.E.2d 163 (1980) (settlor’s intent controls trust construction; interpret instrument as whole)
- Scurlock Oil Co. v. Smithwick, 724 S.W.2d 1 (Tex. 1986) (Texas rule that a judgment is final for preclusion purposes despite an appeal unless the appeal is a trial de novo)
- Amstadt v. U.S. Brass Corp., 919 S.W.2d 644 (Tex. 1996) (elements for res judicata/claim preclusion under Texas law)