*1 Steve, jurisdiction Christopher, RENTAL CORP. See district court. ESSEX CRANE lies with
properly 202, Watson, 208-09 Morano, Appellants, v. A. Geldard Vincent (hold- 2007, pet.) no (Tex.App.-Texarkana v. jurisdiction court lacked ing justice because dis- suit detainer over forcible Eric G. Carter Eric G. CARTER d/b/a which of right possession, over agreement Associates, Appellee. & homestead dispute of familial arose “necessarily required rights property, Corp. and Vincent Rental Essex Crane title”); merits of adjudication Morano, Appellants, A. 197, Smith, Dass, v. Inc. (holding pet.) (Tex.App.-Dallas v. relationship landlord-tenant that because had parties Beverly, Appellee. ended and had parties between Kenneth agree- purchase into entered subsequently to immediate
ment, right of determination Corp. and Rental Vincent Essex Crane resolution necessarily required possession Morano, Appellants, A. thus, and, was jurisdiction dispute of title v. court); Dyne Gibson in district proper Servs., L.P., 138 S.W.3d Midstream gy Farley, Appellee. David W. 2004, no (Tex.App.-Fort Worth of title raised (concluding that issue pet.) 01-09-00813-CV, 01-11-00688- Nos. posses of adverse allegations party’s CV, 01-11-00689-CV. linked” to issue “integrally sion was Marburger, 596 Gentry v. possession); Texas, Appeals Court (Tex.Civ.App.-Houston (1st Dist.). Houston n.r.e.) (holding ref'd writ [1st Dist.] ju subject-matter lacked justice court March suit where over forcible detainer risdiction 7, 2012. Rehearing Overruled June of title adverse raised issues pleadings premises of “title to possession and issue involved”). we directly Accordingly, jurisdic county court lacked
hold that Nancy’s entry forcible tion over Erika and detainer suit. Christopher and Steve’s sole We sustain issue.
Conclusion county vacate the We dismissing render a court and suit entry and detainer the forcible Nancy. brought by Erika *4 Corley,
Kenneth O. Thompson & L.L.P., Knight, Misty Annette Hataway- Cone’, York, Robert Alan Godwin Ronquil- PC, lo Thomas W. Sankey, Thomas W. P.C., Sankey, Houston, TX, for Appellant. Tammy Danberg-Farney, Kyler O. Car- ter, Firm, The Carter Law Kelley, Teri H. Nantz, Cowan, William C. Finis E. Rich- Forrest, ard M. Forrest Law Group, David Smith, M. Associates, David M. Smith & Houston, TX, David Farley, W. Appel- lee. KEYES,
Panel consists of Justices SHARP, and MASSENGALE.
OPINION KEYES,
EVELYN V. Justice. Appellees, Eric G. Carter Eric G. d/b/a Associates, Carter & Farley, David W. and Beverly, Kenneth filed motions for rehear- ing and motions for en banc reconsidera- tion of our opinion issued August grant We rehearing, motions for deny as moot the for en motions banc reconsideration, opinion withdraw our into a set- Entities entered issue the McPherson August (the “TWC Settlement agreement in their stead.1 tlement opinion this pay whereby they agreed Agreement”) Corp. Rental Essex Crane Appellants $900,000 Fund and the a total of (collectively, “Es- A. Morano and Vincent years, of several Facility period over a sex”) judgments the trial court’s appeal owned by equipment in part collateralized court’s the trial appellees favor In the event Entities. by the McPherson quiet Beverly’s motion granting order bankruptcy, Entities filed the McPherson issues, Essex contends title. In four insolvency proceedings, receivership, (1) sustained improperly trial court Facility reserved the Fund and the summary judg- to its objections Beverly’s up them of damages against seek right (2) evidence, erroneously rendered ment $3,147,844, unpaid the total amount of (3) Beverly, in favor of dues, with credit compensation workers’ summary judgments erroneously rendered return, made. In payments previously (4) Farley, and in favor of Carter Facility and the released the Fund *5 Beverly’s motion to erroneously granted any liability re- Entities from McPherson quiet title. Litigation. the of the TWC lating to facts and remand. We reverse in were set out Para- agreements These BACKGROUND FACTUAL Agree- 10 of the TWC Settlement graph Litigation and Settle- The TWC ment, A. provided: which Agreement ment bankruptcy, receiver- In the event of mid-1990s, the Texas Workers’ In the any of ship, insolvency proceeding, or (the Defendant(s) Fund Insurance Compensation kind, way or of Coastal “Fund”) Compen- Texas and the Workers’ Interests, Ltd., that ad- McPherson (the “Facility”) sepa- Facility filed sation the en- versely any affects in manner business entities against rate several suits Agree- of this forceability any of term Entities”) (the owned “McPherson and/or the consideration ment or reduces of McPherson, James Sr. operated by W. derived from the Fund or to be Sr.”) (“McPherson, collect mil- seeking to hereunder, Fund and the Facility unpaid compensation in workers’ lions of that defendant shall Facility’s release (the the “Fa- Litigation” “Fund dues null and void and the Fund and be collectively the cility “TWC Litigation,” to assert all causes Facility will be free Enti- Among the McPherson Litigation”). action, including causes of action for of Litigation in the ties sued TWC dischargeability fraud and contest (“Coast- Inc. Operators, Terminal Coastal debts, Facility that the Fund of al”). may against have now or hereunder the facts that form relating to defendant prior to Litigation was settled The TWC Lawsuit or the the basis for the Fund when, to a May pursuant seeking damages actual Facility Lawsuit agreement connec- plea probation do not exceed aggregate in the pending against charges tion with criminal event, $3,147,844. McPherson, In all amounts court, Sr. and such him in federal Smith, Bros., present the practice of this Court to been Inc. 1. See Brookshire original rehearing panel ... (Tex.App.-Houston motion for [1st 41 & n. 4 denied) justices the case” and that if (holding who heard pet. that when Dist.] rehearing, original panel grants motion for rehearing and mo- party files both motion for moot). reconsideration, long rehearing en is rendered "it has banc tion for en banc previously paid toward the settlement filed the underlying against suit McPher- against any son, hereunder will be credited Coastal, Sr. and along with seven Judgment against obtained that defen- defendants,2 other alleging that all of the Any bankruptcy proceeding dant. such defendants “conspired with each other to validity shall not affect the of the re- transfer, hide, fraudulently secrete or oth- Agreement mainder this or the obli- erwise conceal assets with the intent gations of the other Parties hereto. payment avoid of the debt” to Essex. Es- Litigation subsequently sex Judg- petition B. The Essex amended its ment in Favor of raise similar allegations Essex of fraud and con- spiracy against Carter, appellees Beverly, 1990s, Coastal, In the late one of the Farley. Specifically, Essex alleged McPherson Entities a settling defen- Carter, Beverly, and Farley conspired dant in the Litigation, TWC contracted to with the McPherson Entities to fraudu- rent cranes Essex. lently transfer attempt assets personally guaranteed payment of all avoid satisfaction of the Essex Judgments. rentals to In Essex. Essex sued McPherson, Sr., Coastal and seeking re- Agreed Judgments D.The in the (the covery unpaid crane rental fees Litigation TWC Assignment and the Litigation”). “Essex On August Facility’s Rights Fund’s and the Un- was awarded der the Agreement TWC Settlement Coastal and princi- Sr. in the HII (the $491,261.87 pal amount of “First Es- *6 sex Judgment”). principal The and inter- The summary judgment evidence estab- portion est of that was affirmed that, following lishes entry of the First appeal in August 2004. See Coastal Judgment, Essex in late attorneys Operators Terminal v. Essex Crane Rent Farley, Carter and representing McPher- 14-02-00627-CV, Corp., al No. 2004 WL son, Entities, Sr. and the McPherson be- (Tex.App.-Houston at *9 [14th gan negotiating with the Fund and the 12, 2004, denied) (mem. Aug. pet. Dist.] Facility for an assignment of the Fund’s op.). attorney’s The issue of fees was Facility’s and the rights under the TWC severed and remanded. Id. The trial court (the Agreement Settlement “Assign- tried and attorney’s awarded fees and stat ment”). The Facility Fund and the utory interest on the claim on March agreed assign rights they whatever had (the “Second Judgment”). Essex Es Agreement under the to Houston Industri- sex contends that the amount owed Investments, (“HII”), al LLC in- entity Coastal and McPherson on the two Essex corporated 8, 2002, by Farley on March Judgments, including post-judgment inter exchange payment to them of the re- est, $900,000. now exceeds $275,000 maining balance of due the under Underlying The C. Lawsuit Agreement. terms of the James W. McPherson, Jr., McPherson, son, In part the latter Essex began Sr.’s was collection efforts on the First Essex Judg- managing the sole owner and member of ment, HII, August Having entered on registered agent. and Carter was the success, 10, 2002, McPherson, on December Essex Jr. deposition testified at his Inc., tion, Operators, 2. Neither Coastal Jacintoport Corporation, Terminal McPherson In- McPherson, Sr., terests, Ltd., any James W. Family nor of the James W. McPherson Trust, McPherson, original seven other defendants —Coastal Ste- James W. Jr. and Cara vedoring Corporation, Jacintoport Corpora- party appeal. Hood—is a to this Interests, Ltd., adversely “in McPherson Assignment order sought that he the enforceability of any that HII affects in manner the assets” and was protect [his] reduces any Agreement term of this separate its assets created the the derived from Farley drafted consideration to be own. Carter as- Facility or the the Fund hereunder” —had signment. were not occurred. Writs of execution Assign- the Following execution Judgments, under the Agreed issued TWC ment, agreed judg- HII entered into two the and the collateralized assets ments, signed likewise drafted and Car- (including equipment McPherson Entities Farley Sr. in the ter and with $625,000) valued at were transferred (the Litigation Agreed Judg- “TWC TWC HII. ments”). Litigation In both the Fund contends, HII, and on Facility Litigation, as successor in both at trial the Facility, Judgments that the were appeal, Agreed interest to the Fund and took It fraudulently procured several of are a sham. a final Agree- McPherson Entities for million ac- asserts that Settlement TWC $1.5 $250,000 fees, damages, attorneys’ capped Entities’ lia- tual ment McPherson property bility Facility and foreclosure on certain Fund and the $900,000; $250,000 that all McPherson Entities had used to collateral- but of this debt time, Agreement. paid period ize the over a and that TWC Settlement The was $250,000 Agreed Judgments remaining paid totaled over in return TWC $3 assignment million. for the and the of the Fund’s Facility’s rights to from McPher- payment HII Sr. testified that took son, Sr. and the Entities to McPherson Agreed Judgments help out the HII; that, under the terms of the family. He also he testified that consulted Settlement and the As- Agreement TWC Agreed with Carter before he took the had signment, Facility Fund and the The Judgments. County Travis court that *7 remaining rights by payment to Agreed entered the was Judgments not or the McPherson McPherson Entities to of the relationship informed between the HII, assign wholly to owned and entity HII, defendant, plaintiff, and the McPher- McPherson, by controlled Sr.’s son. i.e., son, by that HII was controlled Sr.— Therefore, Agreed the taken Judgments McPherson, the son of Nor was Sr. it by upon HII and which execution issued informed that HII the had obtained As- however, were fraudulent. con- Appellees, the signment Facility’s and the Fund’s provision upon, tend that the relies rights judgment against as creditors set out in 10 of the Set- Paragraph TWC McPherson, Sr. the McPherson Enti- Agreement, tlement the provide did not exchange fully paying ties in off the remedy exclusive Fund and the of the to debt owed the Fund and the Facility McPherson, Facility against Sr. and the the terms under of -the TWC Settlement HII, McPherson Entities and that as as- Agreement. Nor was it informed the signee rights and the Fund triggered events that the Fund’s and the Facility was entitled to seek from McPher- Facility’s right damages to seek actual son and the Entities the full McPherson the McPherson Entities under judgments amount of the Fund and the Paragraph of the TWC Settlement Facility had obtained. originally Agreement bankruptcy, receiver- “[A]— kind, ship, insolvency Montgomery E. The proceeding, Transfer of the Defendant(s) way of by Coastal or House Judgments,
At the time of the Essex or through Entities, one of the McPherson McPherson, monthly Sr. owned a house in paid Mont- rent on the home and reim- (the gomery County, Beverly Texas bursed “Montgomery taxes and homeowners’ House”). costs, Essex obtained a hen on insurance even though longer he no House, McPherson, Montgomery property. then in owned the name, through Sr.’s the filing, of an ab- Contrary Beverly, McPherson, stract of relating to the Essex testified that Beverly purchased the Mont- Judgments. gomery try House to help him out. Specifically, McPherson, that, Sr. testified McPherson, Beverly had worked as Sr.’s by purchasing the note on the Montgom- accountant since 1989 or 1990 and was also House, ery Beverly allowed him “more long-time friend. McPherson Sr. de- get money time to some together buy faulted on the bank loan and lien securing the property back.” Dr. Balette confirmed House, Montgomery and the note was McPherson, Sr.’s version of events tes- April accelerated the bank. On tifying that he understood he giving was following entry of the two Essex Judg- money Beverly “Beverly and that was ments, and without ever seeing subject going to do something to help Mr. property, Beverly purchased the bank note McPherson with his house.” Balette also House, and lien on Montgomery extin- testified that everything Beverly had said guishing Essex’s Beverly lien. about the Montgomery House had been “a purchased the bank note with the assis- mixture of lies truth” and that he tance of Dr. Beverly Jules Balette. never would have gotten involved had he Balette a long-standing had relationship, known the truth because this “was not a and Balette testified that he trusted Bev- clean deal.” erly. months, Over the course of several fiancee, Muriel,
Balette and Cathy Following the sale of his homestead in $200,000 Beverly loaned over with respect County, Harris Sr. attempted to the Montgomery House. Balette testi- buy back the Montgomery House. His fied that he he loaning believed intent was to use proceeds from the money Montgomery for the House to sale of his County Harris homestead to McPherson, Sr. as a favor. buy back the Montgomery House from Beverly, designate homestead, it as his Despite being Sr.’s account- protect thus the Montgomery House from friend, ant and and despite having pur- *8 However, seizure. Stewart Title declined chased the note and lien on Montgom- policy McPherson, to issue a title for Sr.’s ery prior House to foreclosure repurchase person because the seeking to lender, Beverly testified that he did not Sr.) purchase (McPherson, the property previously McPherson, know that was the same person who had owned the owned the Beverly house. also claimed property prior foreclosure, which made that he was not attempting help the entire questionable. foreclosure McPherson, Sr. and that this was nothing more than a real 22, 2005, estate investment. How- On December around the time ever, McPherson, Sr., who living proceeds that the from the sale of McPher- although son, the house it was not his home- County Sr.’s Harris homestead prop- stead, was never forced to move out. In- erty would lose their statutory exemption stead, Beverly execution, rented the Montgomery McPherson, Sr. wire- House back $150,000 Sr. and his transferred Beverly. Beverly McPherson, Sr., family. that, personally, either testified at the time he received these civil con- fraud and on Essex’s judgment were sent why they funds, sure he was not him and a “Motion claims spiracy against pay- Sr. claimed him. on Lien Summary Judgment for Partial repurchase for intended ment was Fraudu- to Commit Conspiracy Element of House, the fact despite Montgomery motion Beverly’s partial lent Transfer.” after the date occurred transfer that the mo- also included a summary judgment for of the closing on the sale for scheduled Montgomery his title to the quiet tion to a result of Stew- As House. Montgomery reservations, however, House. the re- art Title’s House was Montgomery of the
purchase 28, 2007, an- filed July on Carter Also the Mont- and title to never consummated other, motion for no-evidence separate name. Beverly’s remains House gomery civil con- summary judgment on Essex’s to McPherson ultimately returned Beverly claims, with a motion for together spiracy wire- $60,000 originally funds over damages and a mo- summary judgment on to him. transferred Beverly’s joinder in co-defendant tion for summary judgment. motion for BACKGROUND PROCEDURAL Beverly’s and timely responded to 2006, 17, filed a no- Carter August On various motions. Carter’s on summary judgment for evidence motion conspiracy claims and civil Essex’s fraud 10, 2007, objec- filed August On Carter timely responded him. Essex against evi- summary judgment tions to Essex’s Sep- on for submission motion was set never ruled on The trial court dence. 11, did not The trial court tember objections. these first rule on Carter’s 15, 2007, hearing following a August On motion. Bev- granted the trial court August on filed a second July Carter On summary motion for erly’s no-evidence motion, for Traditional entitled “Motion 15, 2007, August on judgment. Aso and Motion for Sever- Summary Judgment (1) separate orders signed trial court ance,” to the civil respect with summary motion for granting Carter’s pending fraud claim to commit fraud and civil as to Essex’s him. (2) severing Es- conspiracy claims3 and Beverly 23, 2007, against Carter and later, Bever- sex’s claims days July Four cause of action.4 into the same severed summary ly a no-evidence motion filed were sev- summary judg- Essex and Carter' claims between filed four motions for 3. Carter motions for number 2002- ment—two traditional ered into trial court cause no-evidence motions and two court on disposed the trial 62464-A summary judgment. The trial court’s order appeal August which resulted fa- rendering summary judgment in Carter’s Regarding the number 01-09-00813-CV. vor, however, identify which of these does not Essex, Beverly and the trial claims between *9 grant. The order sim- motions it intended to following Au- orders its court issued further Summary ply refers to "Carter’s Motion 15, final gust 2007 severance Judgment claims of Fraud as to Plaintiff's parties’ post-judgment mo- pursuant Conspiracy.” Beverly between and Essex tions. All claims 24, September finally disposed on were separate orders eventual- 4. Because these two Thus, assigned those severed we judgments, ly different final resulted in two 2002- court cause number claims the trial assigning them two an order this Court issued appellate cause number 01—11— 62464-B and sepa- separate court cause numbers trial Thus, 00688-CV. all cause numbers. appellate rate
375 27, 2007, filed a August tolling agreement On Essex motion entered into a with the to set aside amend severance remaining agreed defendants and to non- and/or separate motion to orders and reconsider suit its claims them without preju- summary judgments rendered in Car- pending dice appeal granted of the motions Beverly’s ter’s and favor. by the trial court. 30, 2007, Farley August
On filed mo- summary judgment tion for and severance STANDARD OF REVIEW grounds on the same raised Carter in grant We review a trial court’s of sum- previously granted motion for sum- mary judgment de novo. Provident Life mary judgment. Farley incorporated by Knott, & Accident Ins. Co. v. 128 S.W.3d arguments presented reference the in Car- 211, (Tex.2003). 215 When a party has that, prior ter’s motions and contended as filed both a traditional a proper no- Carter, attorney similarly situated to he motion, evidence summary judgment we summary judgment was entitled to for the first review the trial court’s summary again same reasons as Carter. Essex under no-evidence standard timely responded fully and the matter was 166a(i). of Texas Rule of Civil Procedure briefed. See Ford Motor v. Ridgway, Co. 135 4, 2007, September On Beverly filed his (Tex.2004). 598, 600 “Objections to Evidence Cited in Plaintiffs’ prevail To on a no-evidence motion for Response to No-Evidence Motion for summary judgment, the movant must es- Summary Judgment” motion which the —a tablish that there nois evidence to support already trial court had granted August an essential element of the non-movant’s 15. Essex respond Beverly’s did not claim on which the nonmovant would have objections. proof the burden of at trial. Tex.R. Civ. 24, 2007, September On the trial court 166a(i); Love, P. Hahn v. 321 S.W.3d denied Essex’s motion to set aside or 523-24 (Tex.App.-Houston [1st Dist.] amend the severance orders and its motion denied); pet. see Design Flameout & Fa- to reconsider summary judgments ren- brication, Caspian Inc. v. Pennzoil Corp., in dered Carter’s Beverly’s favor. 834 (Tex.App.-Houston That same day, the trial court signed an pet.). The [1st Dist.] burden then order quieting Beverly’s title to the Mont- shifts to the present nonmovant to evi- gomery House. The next day, September dence raising genuine issue of material 25, 2007, the granted trial court Farley’s fact as to each of the specified elements motion judgment and motion Trucks, Tamez, the motion. Mack Inc. v. to sever.5 (Tex.2006); Hahn, 26, 2007, September On the trial court S.W.3d at 524. “The movant ‘must be signed an granting Beverly’s order objec- specific challenging the evidentiary sup- tions to summary judgment Essex’s evi- port defense; for an element of a claim or entirety. dence their only This is the (i) paragraph does not authorize concluso- trial sustaining any objections court order ry general motions or no-evidence chal- ” evidence. lenges opponent’s Hahn, to an case.’ trying
To avoid remaining case (quoting S.W.3d at 524 P. Tex.R. Civ. cmt.). against only defendants, 166a(i), some of the *10 62464-C, 5. assigning This Court issued an order appellate this which resulted in cause severed cause trial court cause number 2002- number 01-11-00689-CV. 376 each element conclusively establish must the motion grant must court
“The trial of law. See a matter more than of that defense as produces nonmovant unless the Martinez, 941 raising genuine Inc. v. Sci. Spectrum, of evidence a scintilla (Tex.1997). Therefore, challenged fact on the 911 of material S.W.2d issue Design & Fabrica- in of a summary judgment Flameout favor elements.” avoid More than a tion, at 834. S.W.2d affirmative 994 the defendant’s defendant on if the evidence exists of evidence defense, scintilla raise a fact issue plaintiff must enable reason- level that would “rises to a one element of defense. as to at least to differ in people fair-minded able and id.; v. Creek City Houston Clear See Pharms., Dow Merrell their conclusions.” (Tex. Auth., 678 Basin 589 S.W.2d (Tex. Havner, 711 953 S.W.2d Inc. v. 1979). 1997). However, the evidence of- “[w]hen summary court’s reviewing In the trial fact is so weak as a vital prove fered to take all evidence favorable judgment, we or a mere surmise more than create do no true, indulge and to the non-movant as existence, the evidence is of its suspicion every inference in his favor. reasonable and, effect, legal than a scintilla no more at 911. Spectrum, Sci. 941 S.W.2d Con/Chem, v. Kindred is no evidence.” (Tex.1983). Inc., In ques- fact whether a material determining IN FAVOR SUMMARY JUDGMENTS exists, direct may consider we both tion AND FARLEY OF CARTER Ridgway, evidence. and circumstantial issue, contends that In its third Essex at 601. engaged in a civil con- Farley Carter summary on a traditional prevail To original of the other spiracy with several motion-,the movant has the bur- underlying suit to fraud- defendants judg- that he is entitled proving den of ulently transfer assets are of law and that there ment as a matter out of its the McPherson Entities material fact. Tex.R. genuine issues of of the Texas Uniform reach violation Booth, 166a(c); Cathey v. Civ. P. (“TUFTA”). Act Es- Fraudulent Transfer (Tex.1995). 166a(i), Rule S.W.2d contend that either Carter or sex does not summary judgment governing no-evidence Farley directly violating is liable for TUF- motions, apply ordinary mo- “does not TA.6 para- under for tions (a) (b), the movant in which
graphs
motions for sum-
In their no-evidence
that it is entitled to
prove
must
mary judgment,
Farley argued
Carter
each element of
by establishing
that their “zeal-
that there was no evidence
a matter of law.”
its claim or defense as
former clients
representation
ous
[their]
Hahn,
(quoting Tex.R.
377
In their traditional motions for sum- or control of the
property
transferred
after
mary
Farley
transfer;
judgment, Carter and
con-
the transfer
obligation
or
they
tended that
were entitled to sum-
concealed;
was
the debtor was sued or
mary judgment because Essex failed to threatened with suit before the transfer
plead
against
an actionable claim
them.
incurred;
was made or the obligation
They
argued
Essex’s claims were value of the consideration
by
received
premised
by
on conduct undertaken
them
reasonably equivalent
debtor was
attorneys
as
in the
their
representation of
transferred;
value of the asset
the debtor
in litigation
they
clients
and that
were was insolvent or became
shortly
insolvent
immune from suit
non-clients in the
after the transfer was
obligation
made or
litigation for such conduct. Carter and incurred;
the transfer
shortly
occurred
be-
that,
Farley also contended
even if Essex
fore or after a substantial debt
in-
was
claim
pled
had
actionable
them curred; or the debtor transferred the es-
civil conspiracy,
genuine
for
no
issues of
sential assets of the business to a lienor
material
fact precluded
granting
of who transferred the assets to an insider of
their
traditional or no-evidence motions
the debtor. Tex. Bus. & Com.Code Ann.
conspira-
on those
24.005(b);
Hahn,
§
see
The actual intent to defraud is shown S.W.2d 51 (Tex.App.-San Antonio n.r.e.) by, among things, other evidence that writ ref'd (pointing out that trial insider, transfer was made to an including grant court’s decision to instructed verdict relative; the debtor possession retained conveyance fraudulent issues “was in *12 378 intent. See transferor’s fraudulent rule that the of the general of
contradiction
24.005(b);
§
a
& Com.Code
conveyance is
fraudulent
of a
existence
Ann.
Tex. Bus.
facts”).
8; Flores,
Hahn,
161
“In-
at 525 n.
of the
321 S.W.3d
trier
for the
question
within the
“fraudulent
intent
is
uniquely
755.
If
question
a fact
S.W.3d at
tent is
it so
fact because
and circum-
trier of
be deduced from facts
only
realm of the
wit-
credibility of the
mere
upon the
law considers as
depends
which the
stances
se,
to their
weight
given
to be
per
and the
not fraud
these
badges
nesses
of fraud and
Flores,
fact,
161 S.W.3d at
testimony.”
to the trier
must be submitted
to the fair-
the inference as
which draws
is one of
to an insider
A transfer
character of the trans-
or fraudulent
ness
to de
actual intent
proving
factors in
Flores,
(quot-
at 754
161 S.W.3d
action.”
Tex. Bus. &
See
under TUFTA.
fraud
434).
Co.,
at
Cattle
10 S.W.3d
ing Coleman
24.005(b)(1).
§
An “insid
Ann.
Com.Code
individual,
Conspiracy to
Fraudu-
includes,
B.
Commit
if the debtor is
er”
debtor,
general partner
a
lent Transfer
a relative of
debtor,
in which
partnership
or a
of the
(1) there
Farley contend that
Carter
Id.
general partner.
is a
the debtor
committed
they
evidence that
either
is no
(Vernon 2009).
24.002(7)(A)
If the debt-
§
or con-
transfer themselves
a fraudulent
includes,
an “insider”
corporation,
a
or is
a fraudulent transfer and
spired to commit
debtor,
others,
an officer of the
among
(2)
were all undertaken
their actions
debtor,
rela
or a
person in control
in litigation,
of their clients
representation
director, officer,
general partner,
tive of a
immunity from suit for
entitling them to
Id.
in control of the debtor.
person
or
trans-
conspiracy to commit
fraudulent
24.002(7)(B).
status is not limit
§
Insider
fer.
however,
ed,
capacities
in the
persons
tort
“Conspiracy is a derivative
24.002(7); rather, the lists
in section
listed
purpose,
requiring an unlawful means
24.002(7)(A)
(B) are
in subsections
tort.”
may
underlying
include an
which
purposes
exemplification.”
“for
provided
(Tex.
441, 444
Hong,
v.
249 S.W.3d
Chu
8;
Hahn,
at 525 n.
Putman v.
321 S.W.3d
2008);
&
Gary E. Patterson
As
see also
16,
(Tex.App.
805 S.W.2d
18
Stephenson,
(Tex.
180,
Holub,
204
v.
264 S.W.3d
socs.
writ).
an “in
general,
no
In
Dallas
denied).
2008, pet.
App.-Houston [1st Dist.]
entity
close
person
is a
or “an
whose
sider”
Thus,
negate summary judgment
subjects
with the debtor
relationship
transfer
conspiracy claim in a fraudulent
between the debtor and
transactions made
case,
evidence of the
there must be some
heavy scrutiny.”
Equip.
Tel.
the insider to
in a
participation
movant’s
Place, Ltd.,
Network, Inc. v. TA/Westchase
Chu,
a fraudulent
transfer. See
commit
(Tex.App.-Houston [1st
609
80 S.W.3d
249
at 444.
pet.).
Dist.]
status,
attorney
opposing
for an
An
determining
In
insider
(1)
may
held liable for breach of
party
not be
are to consider
the closeness
courts
merely
making
fiduciary duty or fraud
transferee
relationship
between the
(2)
party in
opposing
representations
trans
whether the
and the debtor
that further the best interests
(citing litigation
Id.
length.
were at arm’s
actions
19;
(5th
& n.
own clients.
Id.
446
F.2d
Holloway,
In
re
McCamish, Martin, Brown,
Cir.1992)).
&
However,
necessary
it
not
is
Loeffler
Interests,
Appling
in F.E.
is an insider
that a transferee
prove
Crain,
(Tex.1999);
&
Alpert v.
Caton
knowledge
the transferee’s
prove
order to
(Tex.
James, P.C.,
398, 406
legal
depend-
transaction or that their
fees
*13
denied);
pet.
App.-Houston
upon keeping
Dist.]
ed
the assets from
[1st
Essex.
Corp.
see also Finserv Cas.
Settlement
Essex
contends
the record reveals
LLC,
Funding,
F.Supp.2d
671
Farley
that both Carter and
were inter-
(S.D.Tex.2010). However,
attorney
“[a]n
twined in the transaction between HII and
...
on a
personally
who
tells lies
client’s
the McPherson Entities and
genuine
...
may
behalf
be liable for
fraud in some
issues of material fact exist as to whether
Chu,
Thus,
cases.”
mately
resulting
injury.
(cid:127) McPherson, Jr. was the owner and
S.W.3d at 446-47.
HII;
managing
sole
member of
(cid:127)
Conspiracy
Evidence of
Commit
eight
weeks after HII
incorporat-
was
ed,
Fraudulent Transfer
Farley negotiated
Carter
with
the Fund and the Facility
acquire
In their no-evidence motions for
assignment
an
of their rights in the
summary judgment,
Farley
Carter and
$275,000
Agreement
Settlement
for
they
contend
could be liable for
HII;
only
they
if
agreed
injury
to the
to be
(cid:127)
Farley
assign-
Carter and
drafted the
accomplished;
inferring
agreement
an
as
ment;
injury generally
ultimate
arises
(cid:127)
HII,
assignment,
after the
represented
joint
“from
participation
the transac
by Farley,
took
judgments
final
enjoyment
tions and from
of the fruits of
McPherson,
Sr.
and the
transactions”;
there
is
evidence of
million;
McPherson
Entities
$3.5
agreement
meeting
the minds
(cid:127)
McPherson,
represented
Carter
between
party
themselves and
other
and the McPherson
Entities
those
transfer, hide,
“fraudulently
this suit to
proceedings; and
secret or otherwise conceal assets with the
(cid:127)
intent
payment
to avoid
of the debt” to
assignment
Carter
testified that
Essex,
harm;
to its
and there is no evi
as a
plan-
done
form of “estate
they enjoyed
dence that
ning,” specifically,
fruits of the
to create a friendly
up
were drawn
incorporation
documents
relationship between
creditor-debtor
registered
as
Farley, and Carter served
McPherson,
company
Jr.’s
McPherson,
that HII
Jr. testified
agent.
entities.
Sr.’s
from his
its assets
separate
was created to
can be
contends
it
further
sought
Assignment
he
own and that
and his client
that Carter
logically inferred
protect
“in order to
assets.”
[his]
HII
as to
agreement
were in
discussed
*14
to
agree
Sr. would
whether
Assign-
Farley
and
drafted
Carter
judgment entered
million
pay the $3.5
Facility’s
and the
ment of the Fund’s
by his son’s
companies
against him
Agree-
Settlement
rights under the TWC
also contends
HII. Essex
company,
Agreed Judg-
They
to HII.
drafted
ment
McPherson, Sr.
if Carter and
when asked
Enti-
which the McPherson
ments under
of action Carter
on this course
agreed
had
agreed
HII
that the McPherson
ties and
Sr.,
McPherson,
who asserted
deferred
original
the entire
pay
Entities would
According to
attorney-client privilege.
the
debt, in the amount
amount of the satisfied
Essex,
it had been un-
the extent that
$3,147,844,
filed the
They
to HII.
then
of
agree-
an admission of this
produce
able to
with
Judgments they had drafted
Agreed
McPherson, “it
between Carter and
ment
County district court without
the Travis
of the
of Defendant’s use
only
is
because
Assignment
informing the court that
the
Essex further
attorney-client privilege.”
satisfied debt as to
previously
was of
that the fact that there was no
contends
right
no
of
assignor
which the
retained
Judgments is
Agreed
for the
legal basis
had
payment
Assignment
and that
the
conspi-
further circumstantial evidence
by a
been made to an
controlled
insider
ratorial intent.
They promptly pro-
the
relative of
debtor.
produced
that Essex has
We conclude
judgments against
the
ceeded to execute
a material fact
evidence sufficient to raise
Entities,
removing from
the McPherson
of the elements of fraudulent
issue on each
Essex’s reach assets otherwise available
transfer,
“badges
of the
including several
placed
lien
satisfy
the
it had
finding
form the basis for a
of fraud” that
McPherson,
the transferred assets.
defraud under TUFTA. See
of intent to
Agreed Judg-
HII took the
testified that
24.005(a)(1),
§§
Fex. Bus. & Com.Code
Ann.
family.
He also
help
ments to
out
Flores,
(b);
Specifical-
at 755.
S.W.3d
with
plan
testified that the
was discussed
evi-
ly,
produced summary judgment
it has
Carter.
jury
reasonably
dence from which a
could
Each of these facts
circumstances
Farley, acting
as
infer that Carter
“badge
of fraud.” See Tex.
constitutes
McPherson,
McPherson, Sr.,
attorneys for
24.005(b); Hahn,
§
Bus. & Com.Code
Jr.,
Entities, and with
and the McPherson
Ann.
525; Flores,
at
161 S.W.3d at
protecting
intent of
McPher-
specific
only
intent is
755. Because “fraudulent
son,
and the McPherson Entities’ as-
Sr.’s
facts and circumstances
be deduced from
Essex, negotiated
by
sets from collection
fraud,
badges
which the law considers
Assignment
and executed the
to the trier of
these must be submitted
Facility’s right
payment
Fund’s and the
fact, which draws the inference as to the
McPherson,
the McPherson
Sr. and
character of the
fairness or fraudulent
under
the TWC Settlement
Entities
Flores, 161
at 755
insider, HII,
transaction.”
newly
Agreement
to an
Co., 10 S.W.3d at
(quoting Coleman Cattle
entirely owned and
corporation
formed
434);
Quinn,
Also,
303 S.W.2d at
HII’s
see also
controlled
Jr.
(i)
166a(c),
has raised
defense. See
Civ. P.
conclude that Essex
fact
We
Tex.R.
cmt.;
Farley’s
&
see also Mendoza v. Flem-
regarding Carter’s
issues
ing, 41 S.W.3d
(Tex.App.-Corpus
in a
to hide their
participation
injury
pet.) (holding appellees
to effect
Christi
assets
order
clients’
failed to establish affirmative
by drafting
legal
docu-
defense
upon
attorney
matter
legal
immunity
actions that
as
of law be-
taking
ments and
cause material fact
existed
the transfer of
Sr.’s
issue
concern-
effected
ing
appellees’
assets to HII
whether
actions were within
and McPherson Entities’
law);
Lackshin v.
placed
beyond
Spofford,
them
reach of Es-
bounds
cf.
14-03-00977-CV,
No.
2004 WL
We further conclude
Essex has
sex.
*5 (Tex.App.-Houston
Sept.
[14th
a fact
whether
Dist.]
raised
issue as to
Carter
denied)
(mem.
pet.
op.)
scheme
Farley promoted
(holding
to earn a
trial
they
granting
court did not err in
fee for themselves that
would not
traditional
*15
they
summary judgment
appellee’s
earned
not
assisted
in
have
had
favor be-
in
transfer
cause
evidence
Sr.
a fraudulent
conclu-
sively proved
appellee’s allegedly
them from
that
protect
McPherson’s assets to
ac-
tionable conduct
during
legal
creditors such as Essex.
occurred
his
representation
appellant
of client and
Thus, we hold that Essex has raised
allege
to
facts
failed
sufficient
to show that
fact
to Carter’s
material
issues as
and
appellee’s alleged conduct fell within an
Farley’s knowing
in a con-
participation
defense).
exception to this affirmative
to defraud.
spiracy
Farley’s
We hold that
and
Carter
reli-
part of
sustain the first
Essex’s
We
on
support
immunity
ance
Chu to
their
issue.
third
misplaced.
defense is
Attorney Immunity
that attorneys
Chu did not hold
are
In their traditional motions for
immune to suit for fraudulent acts under-
summary judgment,
Farley
and
Carter
client;
in
representation
taken
the
of a
it
that,
contend
because their actions with
exactly
opposite.
indicated
See 249
to
respect
and the
Chu,
at
In
446 & n. 19.
the su-
McPherson Entities at issue were under
commented,
court
“An
preme
attorney
in their
counsel for
capacity
taken
as
those
goods or
personally
who
steals
tells lies on
to
clients
advance their best interests in
may
client’s behalf
liable for
a
be
conver-
context,
litigation
they
are immune
Id.;
or fraud in
sion
some cases.”
see also
liability for their
from
actions. Carter and
Co.,
Ry.
Poole v. Houston & T.C.
58 Tex.
Farley rely on
their
support
Chu to
claim 134,
(1882) (holding
137-38
attorney
that
immunity
for
liability
to
goods
fraudulently
who
diverted
to evade
violate TUFTA. See
ground
for
another”).
on
or malicious con
frauds for
based
premeditated
fraudulent
added)); McCamish,
(emphasis
duct”
cf.
Chu,
supreme court held
a
In
Martin,
& Loeffler,
Brown
991 S.W.2d at
attorney
be held liable
could not
buyer’s
attorney
(recognizing qualified
immu
community
a bill
drawing up
of sale
for
nity
representations
for
in adversari
made
request
client’s
shop,
at his
property,
context).
al
was selling
he knew that the seller
when
consent.
spouse’s
without his
shop
Here,
sued
Essex has not
Carter
buy-
It reasoned that the
S.W.3d at 446.
Farley
representations
for their
it
duty to
attorney
fiduciary
had a
fur-
er’s
the scope
or for their lawful actions within
client,
of his
ther the best interests
represent
professional duty
of their
buyer,
imposing
duty
on him second
McPherson, Sr.
the McPherson Enti
inevitably
to the sellers “would
conflict
litigation.
them
ties
this
It has sued
Id.;
Finserv
with the first.”
see also
Cas.
drafting
their actions in
and fil
allegedly
F.Supp.2d
(quoting
Corp.,
ing
legal
fraudulent
documents
attorney
statement
who
“[a]n
Chu’s
their
purpose
conspiring
hide
clients’
goods
steals
or tells lies
personally
assets from
creditors
violation
may
client’s behalf
be liable for conversion
*16
Attorneys
immunity
of TUFTA.
have no
cases,”
concluding
or fraud in some
but
knowingly drafting
from
fraudulent docu
“not
that facts of instant case were
prop
ments to evade the lawful seizure of
Chu,”
type of situation indicated in
which
creditor,
erty by judgment
they
a
may
defraud,”
with
conspiracies
“all dealt
deny
liability
judgment
not
their
to the
attorney’s immunity
upholding
and thus
by
creditor for the
sustained
reason
loss
by opposing party
claim of conversion
in
wrongful
ground
their own
acts on the
that
Alpert,
at
litigation);
178 S.W.3d
405-06
clients,
they
agents
are the
“for
of their
(holding
attorney
that
was im
defendant
justified
ground
one is
on that
in knowing
liability
represen
mune
actions in
from
committing
ly
premeditated
willful and
stating
upon,
tation of client sued
but
that
Poole,
frauds for
58 Tex.
another.”
at
lawyer
in
participates
independently
“[i]f
137-38;
Chu,
also
at 446
see
249 S.W.3d
&
activities,
‘foreign
fraudulent
action is
”
19;
406; Likover,
Alpert,
n.
at
S.W.3d
attorney’
of an
and that
duties
“[a]
696 S.W.2d at
sustain the
We
second
own
lawyer thus cannot shield his
willful
part of Essex’s
and hold
third issue
that
actions
premeditated fraudulent
from
Essex has raised material fact issue as to
liability simply on
that he is
ground
Farley
whether Carter and
are immune
client”)
Poole,
agent
(quoting
of his
58 Tex.
subject
from their actions made the
of this
Lackshin,
137);
1965636,
2004 WL
at *3
litigation.
review,
(concluding,
complained
after
that
malicious,
was not
conduct
fraudulent
We therefore hold that the trial court
stating, “If
as a
prove
but
defendants
mat
entering summary judgment
erred
that
allegedly
ter of law
their
actionable
Farley
their
favor of Carter and
on
affir-
representa
conduct was undertaken in the
attorney immunity.7
mative
defense
client,
they
a third-party
tion of
then
have
summary
their
issue.
judg-
shown
entitlement to
We sustain Essex’s third
alleges,
we
Farley
procedurally
7. Essex also
and Carter and
defective. Because
have
deny,
Farley’s summary
summary judgment
Carter and
concluded
must
reversed,
damages
judgment
regarding
we do
motion
be
not reach this issue.
See, e.g.,
SUMMARY JUDGMENTS IN
v. Kasprzak,
Vice
OF BEVERLY
11 (Tex.App.-Houston
FAVOR
pet.
[1st Dist.]
denied).
party
objections
If a
has
to de
(1)
Essex contends that the trial court
fects in the form of supporting attach
Beverly’s objections
improperly sustained
ments,
objections
those
must be made in
(2)
evidence,
to its
er-
writing
placed
court,
before the trial
roneously
rendered
no-evidence sum-
objections
or the
will be waived. See
(3)
mary judgment in
Beverly,
favor of
166a(f);
Tex.R.
P.
Civ.
Grand Prairie In
erroneously granted Beverly’s motion to
dep.
Vaughan,
Sch. Dist. v.
quiet
any
title in the absence of
actual
(Tex.1990).
944, 945
A party’s failure to
arising
cloud on the title
actions
secure a ruling
objection
on an
also waives
agree.
Essex. We
See,
Vice,
the issue on appeal.
e.g.,
Beverly’s Objections
A.
to Essex’s
at 11.
Summary Judgment Evidence
Here, the trial
granted
court
Beverly’s
issue,
In its first
Essex contends
no-evidence
motion for
the trial
improperly
court
sustained
order entered on August
fol-
Beverly’s objections
summary judg
lowing a
hearing
August 13. On Au-
ment
it
response
evidence
filed in
to Bev
27, 2007,
gust
Essex filed a motion to
erly’s no-evidence motion for summary
summary judgments
reconsider the
ren-
objections
because the
were not dered in
and in Beverly’s
Carter’s
favor.
granted
filed until after the court had
Bev
4, 2007,
September
On
Beverly filed his
motion,
were,
therefore,
erly’s
they
“Objections to Evidence
Cited
Plaintiffs’
waived.
Response to No-Evidence Motion for
Summary Judgment.”
On September
preserve objections
To
to sum
*17
the trial court denied Essex’s motion to
mary judgment
appeal, par
evidence for
a
September
reconsider. On
the trial
ty asserting
objections
the
must obtain a
signed
court
an order granting Beverly’s
ruling at
before
summary judgment
the
objections to
summary judgment
Essex’s
hearing.
a prerequisite
presenting
“As
to
entirety.
evidence in their
Because Bever-
review,
a
complaint
appellate
the rec
ly’s objections were untimely filed after
...
complaint
ord must show that
the
was
summary judgment had been entered on
made to the trial
by timely request,
court
a
”
his claims and the trial court refused to
Tex.R.App.
objection, or motion....
P.
reconsider
its ruling granting the sum-
166a(f) (stat
33.1(a)(1); see Tex.R. Civ. P.
mary judgment,
the trial court’s order
ing, “Defects in the form of affidavits or
granting Beverly’s untimely
objec-
filed
grounds
attachments will not be
for rever
summary judgment
tions to the
evidence
specifically
sal unless
pointed
by objec
out
was
erroneous.
See Tex.R.App. P.
tion
an opposing party
opportuni
with
33.1(a)(1); Hogan,
883 (Tex.App.-Dallas pet.); see Beverly’s B. No-Evidence Motion for also McConnell v. Indep. Southside Sch. Summary Judgment Dist., (Tex.1993) 343 n. 7
(holding that all issues must be expressly Essex also contends the trial court). presented Summary to trial judg granting Beverly’s court erred in no-evi presented ment evidence must be summary judgment a dence motion for be (1) form that be produced would admissible at trial. cause it more than a scintilla a claim wrongful support act to underlying conspiracy its supporting of evidence to violate (2) Beverly procedural- against was claim, Beverly’s motion (3) argu- Essex had Beverly’s legal no evidence that inadequate, TUFTA ly Beverly. bring foundation. its claim standing ments lacked motion for a no-evidence filed Beverly Beverly’s Participation in a Con- alleged in which he summary judgment spiracy Violate TUFTA (a) no evidence was there first, that Essentially, Beverly alleged, McPherson, Montgom- the Sr. transferred of genuine to raise a issue (b) had failed TUFTA; the violation of House in ery of a con- fact as to the existence material as de- was an “asset” House Montgomery (c) and as to spiracy to violate TUFTA TUFTA; purchase Beverly’s fined conspire intent to to violate TUF- securing specific and lien *18 interfere with collec- conspiracy to ment lien. a valid a debt” because “[without tion of McPherson, living Sr. was in the house lien, general than Plaintiffs were no more to move out. In- and was never forced creditor has no “[a]'general creditors” and stead, Montgomery Beverly rented fraudulent trans- claim for for McPherson, Sr. and his House back to (m) fer”; any in any “had interest Essex McPherson, Sr., family. personally either [McPherson, judgment against or claims Entities, through one of the McPherson on March assignment after Essex’s Sr.] home and reim- paid monthly rent on the (n) Morano, entity],” related 2002 to Inc. [a Beverly for taxes and homeowners bursed any in receiv- Essex “ever had an interest costs, though longer he no insurance even able, judgment against claim or Coastal Following the sale (o) property. owned the Inc.”; or Essex Operators, Terminal County, McPher- in Harris his homestead any judg- claims or “had interest in son, attempted proceeds to use Sr. [McPherson, at the time against Sr.] ment buy Montgom- to back the from that sale $150,000 Beverly.” We to payment of the Montgom- designate to ery House and hybrid mo- Beverly’s construe motion as protect to it as his homestead ery House alleging essen- tion for However, Title de- Stewart of an from seizure. tially that there was no evidence McPherson, to policy Beverly to issue a title fact issue as whether agreed dined McPherson, Sr. repurchase merely because not with the conduct Sr.’s that resulted person same who had owned was the injury in the transfer of assets sub- —the to the sale of the house to prior property ject judgment to Essex’s lien—but with Beverly. On around December injury Essex to be accomplished, to proceeds that the the sale of the time from i.e., payment evasion of the judgment McPherson, County Sr.’s home- Harris Chu, subject from assets to the lien. See statutory were to lose their property stead 19; 446-47 & n. Stoneci execution, McPherson, Sr. exemption pher, 591 at 808. $150,000 Beverly, wire-transferred to We hold that Essex has raised a materi- claiming that was intended payment al fact each of the issue on elements of its repurchase Montgomery of the for the against Beverly claim for conspiracy to despite the fact that the wire trans- House court, The violate TUFTA. trial there- after the closing fer occurred scheduled fore, granting Beverly’s erred in no-evi- Montgomery date for the sale of the summary dence motion for judgment on occur, Because House. the resale did not ground. this Montgomery title House remains Standing 2. Essex’s name. Beverly’s that the We hold evidence is sufficient Beverly argues that pro- also Essex material whether raise a fact issue as to duced no evidence that it is a judgment McPherson, Sr.’s Beverly, accountant McPherson, creditor of Sr. and the friend, had the intent to long-time specific only argument McPherson Entities. His conspire by assisting defraud Essex is that lacked a Essex valid lien evading payment House, Montgomery which he Judgments through Essex fraudulent argues anis essential element of a fraudu- transfers Sr.’s assets. See lent transfer claim when the party assert- 24.005(b) (list- § Tex. Bus. & Com.Code Ann. ing the fraudulent transfer would other- defraud, indicia of inter ing as intent to general wise be a mere creditor of the alia, debtor possession whether retained Beverly argues debtor. Es- property or control of transferred after produced sex no evidence of its judgment transfer, debtor was sued or threatened response lien his no-evidence motion made, with before transfer debtor suit judgment. assets, removed or concealed of con- value produced its abstract of received reason- sideration debtor was judgment, which created a lien on McPher equivalent trans- ably value of asset *19 son, Montgomery Beverly Sr.’s House. ferred, debtor was became insolvent or however, argues, made, because that lien shortly after insolvent transfer was by purchase his extinguished of the shortly occurred or after transfer before house, incurred, longer judgment a debt was debtor Essex is cred substantial itor, merely general but a essential to creditor of transferred assets of business McPherson, Sr., and who of that he cannot lien or transferred assets to insider be debtor). general the evi- We further hold that held liable to creditor for con is present spiracy dence sufficient to a material to violate TUFTA.8 Carter, Beverly judgment Appellees Farley, judgments all after the abstract of entered, summary argue judgment judgments that Essex’s not val- these lien was were because, although id and filed were determined obtained Essex’s favor Four- to collect only but was able Butts its fraudu- standing bring to its
To show conveyed $5,000. at 807. The Butts Beverly, Es- Id. against claim conspiracy lent Newman, banker, for right in to their that it had a some land prove only to sex had $6,000 and used shortly the trial existed at before property that Sr.’s to live on. money pay fraudulent trans- to off loans and allegedly of the the time place judg- to not extend its Stonecipher Sr.’s assets did Id. fer of creditors, Butts, or that it became against the reach ment beyond them thereafter, time Stonecipher Id. In within a reasonable in 1961. arose dormant indirect conveyed a direct or Beverly was Newman had and that discovered that See Id. property. of the the Butts in 1967. transferee back to Tex. Bus. & property 24.005(a); Stonecipher’s § the Butts against an action brought He Ann. Com.Code Estate, Butts alleging Estate v. that a con- Newman in Flores, (Tex.1979); see also 808-10 collecting the him from spiracy prevented rais (holding that evidence at 757 S.W.3d the defendants’ lien and that judgment plaintiffs were as to whether ing fact issue Id. running of limitations. fraud tolled the alleged time of debtor at creditors of Supreme observed The Texas Court debtor and whether transfer fraudulent States have throughout the United “courts hinder, actual intent to transfer with made a cause of action for dam- long recognized was sufficient plaintiffs delay, or defraud to conspiracy ages post-judgment for a against preclude hen.” judgment collection of a prevent the plaintiffs). Id. as Stonechipher’s Estate
Beverly cites observed, “A creditor with The court Essex had no his claim that support for right against persons has a of action lien House Montgomery on the judgment lien his property with the who interfere filed, as is re- this suit was at the time lien, as to which he has a so upon debtor conspiracy for standing to sue quired for levy or sale the sheriff prevent of a under for denial to defraud TUFTA It satisfy Id. at 808. rea- judgment.” Therefore, Beverly ar- property right. damage conspiracy in a soned that “[t]he him for standing lacked to sue gues, Essex the interfer- conveyance for fraudulent is Stoneci- conspiracy to violate TUFTA. property right of a or lien ence with loss Estate, however, supports Essex’s pher’s property.” the creditor in the debtor’s Beverly conspiracy standing to sue creditor, judgment with Id. It held “that TUFTA, See 591 opposite. not the violate of a property on the made the basis a lien at 808-10. prevent cause of action for lien, Estate, may of such recover the collection Stonecipher ob- Stonecipher’s In conspira- $21,000 damages as result from such tained a summary judgments Es- Appeals in mination that the 2004—after teenth Court interlocutory and the abate- Beverly— favor were Montgomery House to sex’s sale of the judgments appeal of the judgments, but interloc- ment not to have been final retroactively entry judgments in- summary judg- of final utory judgments, because lien, which existed they disposed of all validated Essex's did not state that ments claims, *20 McPherson, Sr.’s transfer of the at the time of causing appeal to be abated for Beverly, depriving Montgomery Es- House to entry judgment. See Coastal Terminal of final standing claims to to assert its TUFTA Corp., No. 14- sex of Operators v. Crane Rental 08, 02-00627-CV, standing depends upon the exis- (Apr. the extent its WL 1795355 judgment die at that reh'g). lien on house (op. Appellees tence of its pet.denied) therefore, is, waived for argument argument authority to time. This presented no or have 38.1(f). briefing. P. inadequate Tex.R.App. See subsequent deter- support their claim that the cy.” against Id. The court further held that the a principals debtor’s and lender seeking recovery fraud the statute of limita- on the Butts’ tolled basis of civil con- conversion, spiracy, convey- fraudulent judgment tions on the lien that had been ances, usury. Id. at 1346^7. The extinguished, and it remanded the case to financing bank was a bank that held the the trial court to determine whether Sto- mortgage on cattle transferred from the necipher diligence used reasonable in at- debtor, debtor an insider trans- tempting judg- to discover assets of the feree company. Id. at 1347-48. Citing ment debtors. Id. 809-10. Estate, Stonecipher’s the Fifth Circuit held The situation in this case is much the that the bank could not be held liable for Here, same. judgment Essex obtained a conspiracy civil to defraud because the McPherson, against lien Montgomery Sr.’s bank general was a creditor of the debtor However, McPherson, House. Sr. default- provision and there was no in TUFTA “for mortgage ed on the loan on the house. recovery other than recovery of the prop- foreclosure, Before the bank note and the erty transferred or its value from one who property bank’s lien on the by were sold is, directly or indirectly, a transferee or mortgage Beverly, lender McPher- recipient Here, thereof.” Id. at 1361. son, accountant, Sr.’s friend and and title contrast, Beverly was the transferee of the was Beverly, extinguishing transferred to note and lien on Montgomery House Essex’s lien on Sr.’s house, and is still the owner of the Estate, property. Stonecipher’s Under which he has received value from McPher- however, a lien extinguished by fraud sat- son, Thus, he is subject to suit isfies the “property right or lien” element Essex under the rule set out in Stoneci- of a claim of conspiracy to commit fraud. pher’s Estate and Mack partici- as direct See id. at (stating, 808-09 “fraud vitiates pant in alleged conspiracy to defraud touches”). Therefore, whatever it Essex’s rights Essex of its Sr.’s lack of an enforceable hen property in violation of TUFTA. Montgomery House at the time suit was We Beverly hold that has carry failed to filed is no bar to its suit against Beverly, showing, law, burden of as a matter of assuming timely the suit brought that Essex standing Beverly lacks to sue diligence “reasonable was exercised to to violate TUFTA. The debtors,” discover assets of the court, therefore, trial erred in entering no- 810; as it was. See id. at see also Hollins evidence summary judgment Beverly’s Lines, Inc., Rapid Transit favor. (Tex.1969) (tort 59-60 claimant not re We sustain Essex’s second issue. quired to obtain judgment before bringing Beverly’s conveyance action under fraudulent C. “Motion to stat Clear Bever- ute); ly’s Wendel, Eckert v. Title” 120 Tex. (1981) (declaring that “a 23, 2007, July On Beverly filed a creditor, lien, though he specific have no “Motion for Summary Partial Judgment on
may maintain an action in equity to vacate Lien Element of Conspiracy to Commit conveyance fraudulent of his debtor’s Fraudulent Transfer” that also included a land”). Quiet “Motion to Title” to Montgomery
The Fifth Circuit case of Mack v. New House. The trial
grant
court did not
ton,
Estate,
which
Stonecipher’s
relied on
partial summary
motion for
judgment, but
(5th
is also instructive.
388 partial Beverly moved for Essex con- appeal, on issue
In its fourth
prove
that
judgment
ground
“[t]o
on the
in granting
erred
trial court
that the
tends
with collection of a
to interfere
(1) conspiracy
title because
quiet
to
Beverly’s motion
lien,”
debt,
had a valid
must have
Plaintiffs
be-
pending
properly
was not
motion
the
have
that Essex did not
and he contended
given
was never
court since
fore the
Montgomery
lien
a valid
(2)
motion, and
hearing on the
of a
notice
court never made
The trial
House.
partial
the motion
Beverly’s
quiet
suit to
finding on which
the cloud on
lifting
ruling
predicated
namely that Essex
predicated,
was
title
by the trial
finding
Beverly’s title on
Montgomery
lien on the
lacked a valid
lien on the
Essex’s
court that
and,
above,
House,
present
as stated
finding
void—a
House was
Montgomery
lien at the
of a valid
existence
never made.
that the trial court
necessary element
filed is not a
time suit is
quiet
title or
to clear
A suit
conspiracy to violate TUF-
of a claim for
to remove cloud
known as a suit
title—also
See
Ann.
Tex. Bus. & Com.Code
TA.
invalidity
24.002(3)-(4).
Moreover,
on the
Beverly
from title —relies
did not
§
Longo
property.
proof necessary
claim
to establish
supply
defendant’s
“the
156,
relief,”
Lasater,
165 n. 7
to
as
superior equity
right
292 S.W.3d
na v.
his
denied).
in the
support judgment
plain-
pet.
required
Antonio
(Tex.App.-San
Hahn,
quiet
in a
title.
tiffs favor
suit
of the fee
the holder
It exists “to enable
Bell,
531;
also
606
321 S.W.3d at
see
way
from his
equity to remove
blest
S.W.2d at 952.
having
title
unlawful hindrance
legal
right.”
better
Bell v.
appearance
the trial court’s order
We hold that
(Tex.Civ.App.-
Ott,
606 S.W.2d
Montgomery
title to the
House
quieting
n.r.e.)
(quoting
writ
ref'd
Waco
arbitrary
unreasonable and thus
383, 1
Locke,
v.
66 Tex.
S.W.
Thomson
of discretion. See Downer
was an abuse
Hahn,
(1886));
at
Inc.,
321 S.W.3d
see also
701 S.W.2d
Aquamarine Operators,
952).
(Tex.1985)
Bell,
“A
“The test
(stating,
389 SHARP, Justice, exists, dissenting JIM may fact we consider both direct opinion. and circumstantial evidence. Ford Motor (Tex. 598, v. Ridgway, Co. 135 S.W.3d 601 my dissenting I withdraw and concur- 2004). “To raise a genuine issue of materi- 25, ring opinion August dated 2011 and fact, however, al the evidence must tran- opinion substitute this in its stead. Be- suspicion.” scend mere Id. “Evidence that I affirm cause would the trial court’s so slight any is as to make inference a granting Farley’s of Carter’s and no-evi- guess,is in legal effect no evidence.” Id. dence motions for judgment, I respectfully continue to dissent. genuine Is there a issue of material fact precludes granting of Carter’s prevail To on a no-evidence motion for Farley’s no-evidence motions for summary judgment, the movant must es- summary judgment? support tablish there is no evidence to an essential element of the non-movant’s Carter’s and Farley’s no-evidence mo- 166a(i); claim. TexR. P. see Flame Civ. tions for summary judgment contend that Fabrication, Design out & Inc. v. Pennzoil there is no evidence agreement of an or (Tex. 830, Caspian Corp., 994 S.W.2d 834 meeting of the minds between themselves App.-Houston pet.). [1st Dist.] anyone or transfer, else to “fraudulently Thereafter, the burden shifts to the non- hide, secret or otherwise conceal assets present movant to evidence raising genu- with the intent payment avoid of the ine issue of material fact as to the ele- debt” to Essex. ments specified the motion. Mack Citing to Trucks, Hong, Chu v. 249 Tamez, S.W.3d Inc. v. 582 (Tex.2008), 447 (Tex.2006). and Farley Carter note “The trial grant court must they only could be conspira- liable for the motion unless the non-movant pro- cy they if agreed to the injury to be ac- duces more than a scintilla of evidence complished. Inferring agreement raising genuine issue of as to material fact on contend, the ultimate injury, they the challenged general- elements.” Flameout De- Fabrication, ly sign joint arises “fi*om participation & S.W.2d at 834. transactions enjoyment More than a and from scintilla of evidence if exists fruits of case, evidence “rises to a level that transactions” and this would enable there exists no they reasonable and evidence that people enjoyed fair-minded to differ in their the fruits of conclusions.” Merrell the transaction or that their Pharm., Havner, Dow Inc. v. legal depended fees upon keeping the as- (Tex.1997). However, sets from “[w]hen of the McPherson evidence prove offered to a vital fact is so Entities’ other creditors. Essex contends weak as to do no more than create a mere that the evidence supports the conclusion existence, surmise or suspicion of its that Carter and Farley agree did and, evidence is no more than a scintilla in injury to accomplished be pur- because the effect, legal is no evidence.” pose Kindred v. and intent behind their actions was to Con/Chem, Inc., (Tex. hide assets from creditors —the exact inju- 1983). In determining whether a material ry alleged.1 Essex further contends that replied 1. Essex also guments that because neither appeal. Car- on Whether Carter or Far- Farley ter challenge nor raised a ley "enjoyed no-evidence the fruits of the transaction" or they as "enjoyed however, to whether agreed the fruits of the injury, goes to the ultimate agreed injury, transaction” or to the ultimate conspiratorial the issue of intent. Both they precluded relying are ar- Farley challenged these Carter and Essex's evi- *23 390 $56,700 State, Currency v. exist as to in U.S of material fact
genuine issues (Tex.1987) (when 659, 662 viewing Farley “meeting a had whether Carter evidence, if “cir meager circumstantial the McPherson Entities of minds” with with either of cumstances are consistent transfer and shelter in the assist nothing shows that one is by the two facts and possible seizure assets from other, creditors, probable more neither fact making a than Entities’ McPherson inferred”). showing can be a of a summary judgment improper. Without no-evidence meeting conspiratorial in- argues can be of the minds or In Essex that it support, tent, civil conspira- there is no evidence of the evidence “logically inferred” (which extensively cy summary proper discussed in the ma- was is and, therefore, be with to that claim. See respect need not Odem jority opinion LLP, here) Touche, No. Farley that Carter and Deloitte & 04-09-00747- repeated CV, 381721, at *9 (Tex.App.-San the McPherson Entities 2011 WL agreed help denied) (mem. 2, 2011, pet. Antonio Essex and other credi- Feb. hide assets from op.) (affirming grant no-evidence motion tors. civil summary conspiracy record entire- reviewing the in its After claim failed to plaintiff present because to me ty, apparent is that Essex has it conspiratorial in scintilla of evidence any evidence, forth failed to set circum- tent); Westergren, see Shunta v. No. also direct, Farley that stantial or Carter and 01-08-00715-CV, 2010 WL at *7- defrauding the idea of discussed 8 (Tex.App.-Houston [1 Dist.]June creditors, Entities’ much less McPherson (mem. op.) no pet.) (affirming grant it, or they agreed that Carter summary judg- of no-evidence motion for in- Farley requisite conspiratorial had the ment on claim ap- civil because tent Essex or the other to defraud pellant present requi- failed to evidence of most, produced creditors. At Essex has intent; that, site conspiratorial stating Farley some evidence Carter and most, by appellant presented evidence agreed engage or intended to in the con- agreed appellee some evidence that to con- in the injury, duct that resulted which is duct, injury). but not to not to establish cause of action sufficient conspiracy. Airing Although majority apparently for civil See Juhl v. be- (Tex.1996). ton, 936 S.W.2d lieves pre- that the circumstantial evidence produced by While the evidence sented Essex and the inferences to be may give suspicion rise to some that Car drawn from such evidence amounts to ter more Farley agreed conspi- intended to de than a scintilla of evidence of Essex, intent, contrary, evidence ratorial I not. On the fraud such is insufficient do conspiratorial issue of on vital genuine raise a material fact facts such as intent conspiratorial “by vital fact of intent. See must piling not be established infer- (“When Kindred, upon at 63 Schlumberger ence inference.” See prove offered to fact is so v. Nortex Surveying Corp. evidence vital Well Oil & Gas (Tex.1968) Corp., than weak as to do no more create a mere existence, suspicion (stating although proof of its of conspiracy surmise or and, be, “may usually than a must be evidence is no more scintilla made effect, evidence.”); evidence, legal ... is see also circumstantial vital fact conspiratorial respec- intent ment. dence of in their judg- motions for tive non-evidence
may by piling not be established inference inference”).
upon reasons, I affirm For these would *24 final judgments trial court’s as to Carter Farley. FORT BEND INDEPENDENT DISTRICT,
SCHOOL Appellant, GAYLE, Appellee. Alice No. 01-11-00788-CV. Texas, Appeals Court of (1st Dist.). Houston April notes promissory of evidence a TA. The House constituted Montgomery (d) transfer; that, Judg- Beverly’s pur- the time of the Essex shows fraudulent House was Montgomery ments, owned the Mont- chase of foreclosure, “sham” through a collusive or Essex obtained lien gomery House. (e) conspiracy; illegal object or was House Montgomery prior house Beverly’s purchase filing of an abstract through Sr.’s name (f) TUFTA; Beverly’s violated foreclosure Judg- to the Essex judgment relating Montgomery House to rental entry judgments, of these ments. After object of a con- illegal was an McPherson on the defaulted on his loan McPherson payment (g) McPherson’s spiracy; foreclosure, Prior to Montgomery House. $150,000 day before Beverly [the “the been McPherson Sr.’s Beverly, who had $150,000] exempt status as home- lost its since 1989 or 1990 and who accountant fraudulent constituted proceeds” stead friend, long-time purchased also (k) (h)-(i), asset; Bever- transfer of an property lien on the bank note and (l) TUFTA; (j) violate ly conspired to Montgomery lien on the took a second final or a possessed a “Plaintiffs seeing property, without ever House ..., ele- alleged an essential valid lien as thereby extinguishing Essex’s