W & F Transportation, Inc. v. Wilhelm
208 S.W.3d 32
Tex. App.
2006
Check Treatment

W & F TRANSPORTATION, INC., E.H. Wilhelm, Sr., and Margaret Wilhelm, Appellants, v. Cindy and Ricky WILHELM, Appellees.

No. 14-03-00103-CV.

Court of Appeals of Texas, Houston (14th Dist.).

Oct. 5, 2006.

12. Because of this disposition, we need not address the other challenges presented.

Robert G. Miller, William C. Ferebee, Houston, for appellants.

Michell S. Bradie, Peter R. Bradie, Magnolia, for appellees.

Panel consists of Chief Justice HEDGES and Justices FROST and GUZMAN.

MAJORITY OPINION ON REHEARING

ADELE HEDGES, Chief Justice.

We grant the motion for rehearing filed by appellants W & F Transportation, Inc., E.H. Wilhelm, Sr., and Margaret Wilhelm (collectively “appellants“). On rehearing, we hold that Texas Rule of Appellate Procedure 34.6(c) and the precedent governing partial records does not apply in this case, where the only omission from the record is (1) the nonevidentiary argument of counsel, (2) which was not recorded pursuant to the parties’ agreement to dismiss the court reporter, (3) where neither party has assigned error arising from counsel‘s argument or otherwise suggested that those arguments are relevant to our analysis. We accordingly review the issues appellants have raised on appeal.

In eleven issues, appellants appeal a jury verdict awarding appellees Cindy and Ricky Wilhelm (“Cindy and Ricky” or “appellees“) actual and punitive damages in the amount of $33,773.39, plus attorney‘s fees, postjudgment interest, and costs. After reviewing appellants’ issues, we affirm in part, reverse in part, and render judgment dismissing the claims against E.H. Wilhelm, Sr. and Margaret Wilhelm. The opinion issued in this case on March 24, 2005 is withdrawn, and the following opinion is issued in its place.

I. REHEARING OF APPLICATION OF RULE 34.6(c)

In the opinion first issued in this case, we held that appellant‘s failure to comply with Rule 34.6(c) in a case where the parties agreed not to record closing arguments waived appellants’ right to appeal. The opinion states:

Because appellants did not request a partial reporter‘s record under this rule [34.6(c)], and because we do not have a record of the closing arguments at trial, we must presume the omitted portion of the record is both relevant to the disposition of this appeal and that it supports the trial court‘s judgment. Because we are unable to conduct a harm analysis without a record of the closing arguments, we affirm the trial court‘s judgment.

. This holding focused on compliance with Rule 34.6(c); in the absence of compliance with that rule, we applied the common law presumption that omitted portions of the record are both relevant to and support the judgment on appeal (hereinafter “common law presumption“). Appellants filed a motion for rehearing and rehearing en banc challenging this holding.1

On rehearing, we hold that appellants were not required to comply with Texas Rule of Appellate Procedure 34.6(c) in order to avoid the application of the common law presumption and thus preserve their right to appellate review.

A. The Proceedings in the Trial Court

The procedural issue in this case arises from a relatively innocuous agreement to dismiss the court reporter at the trial court‘s suggestion after the close of the evidence. Apparently, the court‘s customary court reporter was absent, and a deputy court reporter was working in her stead. This court reporter attended all of the evidentiary portions of the trial but was dismissed by the parties just prior to closing argument. She recorded all of the testimony introduced at trial and included all of the trial exhibits, and these materials have been included in the record on appeal. She also recorded the charge conference and the objections to the charge. It is not clear from the record whether the parties engaged in voir dire or opening statements; if they did, the court reporter did not record these portions of the trial either.

After the evidence closed and the court charged the jury, the trial judge asked counsel whether the court reporter could be dismissed prior to closing argument. Both parties agreed:

Court: At this time I will now turn the case over to the lawyers for their closing arguments. Can we release the court reporter at this time?

Mr. Bradie: Yes, your Honor.

Mr. Ferebee: Yes, your Honor.

The parties thereafter offered closing arguments off of the record.

The jury returned a verdict. Appellants moved for a new trial and ultimately filed a notice of appeal. Appellants raised several arguments relating to the court‘s charge, the sufficiency of the evidence introduced at trial, and the judgment. Appellants have raised no issue relating to closing arguments, and appellees have not indicated that the content of closing argument is relevant to any of appellants’ issues.2

B. Agreed Nonevidentiary Omissions Pursuant to Rule 13.1(a)

We believe that this case is governed by , in which the Texas Supreme Court held that a reporter‘s record of a pretrial hearing is necessary for the appeal only if the hearing being challenged on appeal is evidentiary. In , the court refused to apply the common law presumption that an unrecorded pretrial hearing supported the judgment on appeal. The court explained that the clear intent of Texas Rule of Appellate Procedure 34.1 is to require a reporter‘s record only where one is “necessary to the appeal.” (citing TEX.R.APP. P. 34.1). The court held that refusing to presume that all unrecorded hearings support the judgment on appeal avoids the inefficient circumstance of requiring parties to record everything in order to show nothing relevant occurred.

As the court explained, if a pretrial hearing is “nonevidentiary” and is instead merely the argument of counsel, the common law presumption should not apply:

What is clear is that a reporter‘s record is required only if evidence is introduced in open court; for nonevidentiary hearings, it is superfluous.

[R]equir[ing] every hearing to be recorded—whether evidentiary (to show what was presented) or not (to show nothing was) [would be] wasteful, [and] would frustrate the intent of our appellate rule requiring a reporter‘s record only “if necessary to the appeal.”

(quoting TEX.R.APP. P. 34.1). The court accordingly refused to “presume that evidence was presented that support[ed] the trial court‘s order.” .

‘s ruling and rationale are persuasive in this case, which like , involves a record omission of counsel‘s arguments that is indisputably nonevidentiary.3 Otherwise, the reporter‘s record before us is complete and contains all of the evidence introduced at trial.4 That record contains all of the witness testimony heard at trial and all of the exhibits that the parties introduced into evidence. Under these circumstances, we are not willing to dismiss the appeal by applying the presumption that unrecorded nonevidentiary portions of trial such as closing argument support the judgment on appeal.

The fact that addressed a pretrial hearing instead of a trial does not change our analysis. Pretrial hearings, such as the hearing held on personal jurisdiction in , can be and often are dispositive. Indeed, pretrial hearings commonly concern matters, such as subject matter jurisdiction, that are essential to a court‘s power to act. See, e.g., (advising early resolution of jurisdictional disputes). Nevertheless, the supreme court has held that these hearings do not need to be recorded and included in the record on appeal unless they are evidentiary. In , the court stated that if “only arguments by counsel are presented in open court,” a reporter‘s record of the proceeding is not needed. . We see no basis for treating the arguments of counsel that occur at trial after the evidence has closed any differently.

Rule 13.1 requires court reporters to “make a full record of the proceedings” unless “excused by agreement of the parties.” TEX.R.APP. P. 13.1(a). As the court stated in , because Rule 13.1 permits parties to dismiss the court reporter by agreement, it “implies an agreement that no record was made because none was needed.” . In this case, we believe that no record was made because both parties agreed that none was needed. We will not now penalize appellants for making this agreement.

C. The Common Law Presumption and Rule 34.6(c)

Historically, “[t]he burden [has been] on the appellant to see that a sufficient record [is] presented to show error requiring reversal.” See (citing former Texas Rule of Civil Procedure 50(d)). As a corollary to Rule 50(d), courts applied the common law presumption that whatever was omitted from the record was relevant to and supported the judgment on appeal.5 As one court explained, “[i]t is the appellant who has the burden of bringing forward a statement of facts. Unless the record [on appeal] shows to the contrary, every reasonable presumption must be indulged in favor of the findings and judgment of the trial court.” .

ing trial court‘s judgment and holding that this court could not determine whether the trial court erred because this court lacked a “complete record” due to the court reporter‘s failure to make a record of the trial proceedings) (not designated for publication); (holding that, in case in which parties agreed that no record would be made of the proceedings during one day of a bench trial, appellate court did not have a complete record due to the absence of a record from that day and that, absent an agreed record or compliance with Rule 34.6(c), appellate court will presume the omitted portions of the record support the trial court‘s judgment) (not designated for publication).

The W & F Parties have not sought to appeal under Rule 34.6(c). They do not claim to have appealed under this rule, and they have not taken any of the steps to invoke this rule. See TEX.R.APP. P. 34.6(c). The majority agrees that this is not a Rule 34.6(c) case and further concludes that, even if the W & F Parties had sought to invoke Rule 34.6(c), this rule does not apply to situations in which part or all of the proceedings are not recorded in the trial court. Although this court need not address this issue, even presuming that Rule 34.6(c) does not apply in such cases, the inapplicability of this rule would not change the general rule that the omitted portions of an incomplete trial record are presumed to be relevant to the appellate issues and to support the trial court‘s judgment, absent application of an appellate rule that would reverse this presumption. See ; .

The majority concludes that the parties’ agreement to dismiss the court reporter implies an agreement that no record of the closing arguments was needed. See . However, the subject matter of the parties’ agreement was that the court reporter could be released. Nothing in the record reflects the parties’ reasons, if any, for this agreement. Though this agreement implies that no record would be made of the proceedings during closing arguments, it is not reasonable to infer from this exchange an additional agreement that no record of the closing arguments was needed, particularly when such an inference contravenes the common-law presumption of relevance. If the majority‘s analysis were correct, then in both civil and criminal cases, parties could agree to forego recording part, or indeed all, of the trial and then still insist that appellate courts review their various appellate issues seeking to overturn the jury‘s findings or the trial court‘s rulings. This is not the law. See ; .

Even more troubling is the court‘s willingness to infer an agreement not stated in the record. Courts should enforce agreements parties actually express and not undertake to find agreements that are not made manifest. Agreements parties make in the course of litigation usually have risks and consequences, and the decision to forego a court reporter for a portion of the trial is no exception. The consequences of the parties’ agreement were foreseeable even if unforeseen. The court‘s role on appeal is a neutral one—to hold the parties to the agreement they made, not to save parties from the consequences of their stated agreement by inferring an agreement that the parties did not express. This court should hold the parties to their agreement as stated on the record. Any other course will only create uncertainty and unfairness. Although there are not many cases dealing with appellants who allowed a record not to be made of part of the trial and then sought to reverse the trial court‘s judgment, this deficit is likely attributable to the rarity of appellants choosing this unusual and risky course. It is a fundamental part of our system that appellate courts have the means to learn what happened during the trial whose result they are asked to overturn. Truth can be stranger than fiction, and to reverse a trial court‘s judgment based on a unanimous jury verdict without knowing what transpired during part of the trial would result in a waste of resources and the all-to-real potential for an unjust reversal of the trial court‘s judgment contrary to the truth. “Imperfect as it may be, our legal system attempts to ascertain facts to arrive at the truth.” (quotations omitted). To dispense with the requirement that appellate courts have access to a record of what occurred during trial would be to abandon the truth-seeking function of the law. See

For example, in the case at hand, the court reverses as to the Individual Defendants based on the majority‘s conclusion that the undefined term “W & F Transportation,” used throughout the jury charge, must have meant only W & F Transportation, Inc. However, this court does not know what transpired during closing arguments. In his closing argument, counsel for Cindy and Ricky Wilhelm (hereinafter “Cindy and Ricky“) may have told the jury that “W & F Transportation” meant all three defendants. Counsel for the W & F Parties may have agreed with Cindy and Ricky on this point, told the jury that “W & F Transportation” meant all three defendants, and then argued the jury should find no liability because there was no evidence of any actionable conduct by Margaret Wilhelm. If this were so, then this court‘s reversal would be erroneous based on the W & F Parties’ inviting the error that they assert on appeal. See, e.g., (holding appellants could not complain of alleged error by trial court in allowing inadequate settlement credit of $100,000 because appellants specifically had requested that the trial court apply a $100,000 settlement credit during closing arguments, thus inviting the alleged error). Another possibility is that, during the unrecorded proceedings and without objection, the trial court may have told the jury that “W & F Transportation” meant all three defendants.

If either of these two scenarios occurred, then the jury properly found all three defendants liable, and the trial court properly denied the W & F Parties’ motion for judgment notwithstanding the verdict, which was the sole means by which the Individual Defendants preserved the issues that the court today sustains. Because the W & F Parties have not reversed the general presumption that the omitted portions of the trial record are relevant and support the judgment, this court should presume that one of these two scenarios occurred, overrule the third and fourth issues, and affirm the trial court‘s judgment in its entirety. See ; ; ; ; see also (stating that case involved partial record because it included closing arguments and charge conference but did not include the trial evidence and applying the common-law presumption that the omitted portions were relevant and supported the trial court‘s judgment because appellant did not comply with Rule 34.6(c)); (holding, in absence of complete reporter‘s record or compliance with Texas Rule of Appellate Procedure 34.6(c), that court of appeals could not reverse based on charge error, in part because court of appeals could not review the closing arguments); (holding that complete record of trial was not provided because record lacked voir dire, opening statements, closing arguments, and some testimony and holding that, because appellants did not comply with the predecessor rule to Rule 34.6(c), the court of appeals had to presume that the omitted portions supported the trial court‘s judgment). Instead, the majority carves out a new exception to the common-law presumption for unrecorded closing arguments.

Although the majority sustains issue three and part of issue four, rather than issues one and two asserting charge error, the W & F Parties’ arguments under all of these issues are substantially similar. The court also concludes that the Individual Defendants preserved error regarding the jury charge‘s alleged defect in referring to an undefined “W & F Transportation.” See . In this context, it is worth noting that alleged charge error is one of several instances in which appellate courts need to review the closing arguments, even if no error is alleged to have occurred during the closing arguments. See, e.g., (stating that, in conducting harm analysis as to charge error, court reviews the entire record, including closing arguments, and finding reversible error, in part, based on closing arguments). This court previously has applied the common-law presumption to an appellate issue asserting that the jury charge contained an erroneous definition (analogous to the Individual Defendants’ third and fourth issues, which the court sustains), in part because the appellate record did not contain a record of the closing arguments that would be needed to evaluate this issue. See . There is no justification for the majority‘s departure from this court‘s reasoning in .

The W & F Parties do not dispute that they elected to forego a court reporter during closing arguments, nor do they dispute that they failed to appeal under Rule 34.6(c). Rather, they assert that it is common for parties, for the sake of economy, to agree that no record be made of closing arguments. How often parties make such agreements at trial is subject to conjecture, but if they do so, it should not be to save money. The parties are not required to pay anything to have a record made of the entire trial, and the court reporter (or court recorder as the case may be) is required to make a such a record upon request.3 See TEX. GOV‘T CODE ANN. § 52.046; TEX.R.APP. P. 13.1(a); . After trial, if a party files an appeal, that party ordinarily must pay to have the record transcribed. However, by following the procedures of Rule 34.6(c), a party appealing can save money by designating only the parts of the record that the party believes are relevant to the appellate issues. See TEX.R.APP. P. 34.6(c); (stating, in memorandum opinion, that an appellant may use the Rule 34.6(c) procedure to minimize expense and delay in the appellate process). An appellant who sufficiently complies with Rule 34.6(c) avoids the legal presumption that the portions omitted from the record are relevant and support the judgment. Under this rule, other parties and the appellate court itself may arrange to have transcribed the parts of the record that the appellant did not request. See TEX.R.APP. P. 34.6(c) & (d). On the other hand, neither an appellate court nor an appellee can have portions of the trial record transcribed if the parties agreed that no record of these portions would be made in the first place. Parties are free to economize by using the Rule 34.6(c) procedure, but agreeing to have no record made at all saves the parties no money, and, unlike consequences flowing from the operation of Rule 34.6(c), it prejudices the appellate court‘s ability to seek the truth and determine what happened at trial. If the parties decide, for whatever reason, that, come what may, they will not appeal the trial court‘s judgment, then they might reasonably decide not to have the trial recorded. Indeed, parties in arbitration often do not record the arbitration proceedings, and this decision makes sense given the arbitrating parties’ inability to obtain any kind of traditional appellate review of arbitration rulings. However, if a party to a case in the court system wants to preserve its rights to full appellate review, then it should be sure to request that a record be made of the entire trial. See ; ; ; ; . If parties wish to minimize costs on appeal, they are free to use the procedures of Rule 34.6(c).4 However, when the parties agree that no record is to be made at all during all or part of a trial, they avoid no costs to themselves and they deprive the appellate courts and themselves of the ability to obtain a record of what transpired during the unrecorded portions of the trial proceedings.

Rather than requiring strict compliance with Rule 34.6(c), the Texas Supreme Court has adopted a flexible approach in certain cases in which a rigid application of Rule 34.6(c) would result in denying review on the merits, even though the appellee has not established any prejudice from a slight relaxation of the rule. See . This approach allows parties who have appealed on a partial reporter‘s record to use Rule 34.6(c) to reverse the general presumption, even though they have not strictly complied with Rule 34.6(c), for example by timely serving the statement of appellate issues on the other parties, provided the other parties have not shown prejudice from this failure to strictly comply. See The majority asserts that creating an exception to the common-law presumption as to closing arguments is the only way to honor this approach as articulated by the Texas Supreme Court in . See (citing ). However, the approach, by its own terms, has limits. See (noting limit to rationale); (applying common-law presumption despite rationale). The better course would be to recognize the limits of this approach and leave the creation of new rules of law to the Texas Supreme Court.

Furthermore, whether by agreement or otherwise, the failure to record parts of the trial proceedings that could relate to alleged reversible error asserted on appeal does not fit within this flexible approach because this failure substantively interferes with the appellate court‘s ability to properly review the merits. Moreover, all parties as well as the trial court and the jury are prejudiced when an appellate court reverses a judgment without having the ability to review a record of all the trial proceedings that could have affected the trial court‘s rendition of the judgment being reversed. If no record is made of parts of the trial, the reviewing court faces a dilemma in trying to deal with the gaps in the record and resolve the appellate issues. Trial counsel‘s perceptions of what occurred during trial may be influenced by conscious or unconscious bias. Counsel may have inaccurate memories regarding the details of what transpired during trials that may have occurred months or even years earlier. During an intense trial, counsel‘s notes of what occurred may be incomplete, inaccurate, or just plain wrong due to other human error. Trial counsel may not focus on trial occurrences that relate to those appellate issues that only the opposing party plans to raise because counsel may not be aware of these issues until after trial. Trial counsel may not be available on appeal. All of these factors make it imprudent for appellate courts to rely upon the representations and recollections of trial counsel to cure gaps in the record of what transpired at trial. Furthermore, in this case, Cindy and Ricky have not conceded that what occurred during closing arguments is not relevant to the W & F Parties’ appellate issues.

The merits of appellate points are not well served if an appellate court considers reversing a trial court‘s judgment without knowing what transpired at trial. This point is illustrated by a relatively recent case from this court in which the appellants asserted on appeal that the trial court erred in applying an inadequate settlement credit; however, during closing argument at the bench trial, the appellants themselves had requested that the trial court apply the credit of which they complained on appeal. See . No party on appeal mentioned that appellants had made this request during closing argument, and if this court had not had a record of closing argument, it might have reversed the trial court for awarding exactly the settlement credit requested by the appellants.5 See Such a ruling would not have served justice, and would not have credited the work of the trial court in resolving the case.6

In sum, the court errs in failing to follow the common-law presumption regarding incomplete records and in treating an agreement to make no record of part of the proceedings more favorably than a failure to either follow Rule 34.6(c) or request the reporter to transcribe the entire record of the trial proceedings.7 However, as discussed above, the former situation is much more inimical to proper appellate review than the latter. Accordingly, this court should apply the dual presumption that the omitted portions of the trial record are (1) relevant to the appellate issues and (2) support the trial court‘s judgment. In doing so, this court would reach the merits of the W & F Parties’ issues; however, with relevant portions that support the judgment missing, the W & F Parties would have virtually no chance for success. That, however, is a foreseeable consequence of the W & F Parties’ agreement that part of the trial not be recorded.

Does compel the creation of an exception to the common-law presumption?

The majority pronounces that “this case is governed by” the Texas Supreme Court‘s recent decision in , which, the majority states, “compels” an exception to the common-law presumption for unrecorded closing arguments. See (holding that appellate court need not presume that special-appearance hearing was evidentiary when all parties conceded that it was not); . The majority‘s conclusion that governs this case and is controlling is undermined by the language in expressly limiting the analysis in that case to pretrial hearings. See (stating “[i]t is difficult to state a bright-line rule regarding unrecorded pretrial proceedings . . . the absence of a reporter‘s record does not tell us whether a pretrial hearing was nonevidentiary, or evidentiary but not preserved . . . the trend has been away from full evidentiary hearings in open court for most pretrial matters . . . [p]resuming that most pretrial proceedings are evidentiary would . . . discourage this trend . . . otherwise, appellate courts should presume that pretrial hearings are nonevidentiary” (emphasis added)). Although, by analogy, some parts of the court‘s analysis arguably may provide some support for the majority‘s analysis, is not on point and does not compel this court to create an exception to the common-law presumption for unrecorded closing arguments during trial. See

There are many reasons why should not affect the analysis in this case. The court held that it did not have to presume that the special-appearance hearing was evidentiary when all parties conceded that it was not. See . The case at hand does not involve the issue of whether a hearing was evidentiary; all parties agree that the hearing in question was the ultimate evidentiary hearing—the trial. The court mentioned a trend away from evidentiary hearings in open court for pretrial matters; however, there is obviously no trend away from evidentiary hearings in open court for cases that are called to trial. See . Furthermore, unlike the parties in , all of whom agreed as to the issue in that case (whether the pretrial hearing was evidentiary), Cindy and Ricky do not concede that what transpired during closing arguments is not relevant to the W & F Parties’ appellate issues. See .

In , the Texas Supreme Court distinguished its statement in a prior case that a party who fails to request the reporter to record a pretrial hearing risks waiving any complaint. See (distinguishing ). The court distinguished this case by pointing out that the parties in that case agreed that the hearing for which the record was lacking was evidentiary. See Likewise, has no application to the case at hand because the hearing in question—the trial—was an evidentiary hearing at which parties who fail to see that a record is made risk waiving complaints.

In deciding whether to presume that the unrecorded pretrial hearing was evidentiary, the court found significance in the fact that the appellate rules formerly stated that the parties must request the court reporter to make a record; however, now Texas Rule of Appellate Procedure 13.1 states the court reporter must make a record unless excused by agreement of the parties. See TEX.R.APP. P. 13.1; . The majority relies on this rule and this part of in its analysis. See . This reliance is at odds with the analysis of this court in , in which this court indicated that Rule 13.1 is void because it conflicts with section 52.046 of the Texas Government Code, which requires court reporters to make a record of proceedings only when requested to do so. See TEX. GOV‘T CODE ANN. § 52.046 (requiring official court reporter to make record of proceedings if requested to do so); TEX.R.APP. P. 13.1(a) (stating that official court reporter must attend court sessions and make a full record of the proceedings, unless excused by agreement of the parties); (indicating that Rule 13.1(a) is void because it conflicts with section 52.046 of the Texas Government Code); accord (agreeing with case that Rule 13.1 is void because it conflicts with section 52.046); (holding, in en banc opinion, that Rule 13.1 is void because it conflicts with section 52.046 and because delegation of rulemaking authority to courts does not authorize courts to promulgate rules that conflict with the substance of existing statutes); contra (concluding that Rule 13.1 is not void); (same); (same), disapproved in part on other grounds by . The court mentioned and relied on the change in the Texas Rules of Appellate Procedure reflected by Rule 13.1; however, the court did not mention or address the conflict between this rule and section 52.046 of the Government Code. See . Nor did the court mention or address the split among the courts of appeals as to whether Rule 13.1 is void, and, to date, the Texas Supreme Court has not resolved this issue. See

On the other hand, this court did address this issue in , and its opinion in that case does not support the majority‘s reliance today on Rule 13.1. In , the appellant asserted that there was reversible error based on the court reporter‘s failure to record a pretrial hearing, as required by Rule 13.1. See . The court stated that, under Rule 33.1, parties generally have to preserve error regarding their appellate complaints by presenting them to the trial court and obtaining an adverse ruling. See The court then stated as follows:

Likewise, Texas Government Code section 52.046, which sets forth the general powers and duties of court reporters, provides that a party must request a court reporter to make a record of proceedings. TEX. GOV‘T CODE ANN. § 52.046(a)(2) (requiring court reporter to attend court and make a record “[o]n request“); see (holding rule 13.1(a) void and proper rule stated by Texas Government Code section 52.046(a)). Here, contrary to Nabelek‘s assertions, the record does not show he requested that the court reporter record the September 13, 2002 hearing . . . By failing to request that the court reporter record the hearing or object to the reporter‘s failure to record . . . Nabelek has failed to preserve these issues for review.

(footnotes omitted). The court stated that Rule 33.1 requires preservation of error as to appellate complaints and that, likewise, section 52.046 of the Texas Government Code requires parties who want a record made to request the court reporter to make one. But section 52.046 only requires this request if Rule 13.1 is void, as appellate courts in Houston and Dallas have held. See ; . If Rule 13.1 is valid, then no request for a court reporter would be necessary. Rather than give effect to Rule 13.1, the court simply cited with approval the First Court of Appeals‘s en banc holding in that Rule 13.1 is void. The court emphasized that Nabelek did not request the court reporter to make a record and stated in passing that Nabelek also failed to object to the court reporter‘s failure to make a record. However, if Rule 13.1 is valid rather than void, then all the court had to do was note that no objection was made to the failure to record the pretrial hearing; there would have been no need to note section 52.046‘s requirement that a record be requested or to cite with approval ‘s holding that Rule 13.1 is void. The court based its conclusion that Nabelek failed to preserve error on his failure to request a record as required by section 52.046, thus indicating that Rule 13.1 is void. See .

The majority does not explain why this court is not following its own recent analysis in . Instead, the majority erroneously concludes that the court did not address the issue of whether Rule 13.1 is void. See . As discussed above, the majority‘s reading of is incorrect. More critically, however, the majority does not say this court‘s analysis in is unworkable or badly reasoned, only that the decision in the case turned on preservation of error and not on the merits of the Rule 13.1 issue. Even were the majority correct in its assessment, that would hardly justify unexplained inconsistency in this court‘s analysis and decisions.

Adhering to precedent fosters efficiency, fairness, and legitimacy. See . More practically, it results in predictability in the law, which allows people to rationally order their conduct and affairs. See Of course, there are times when continued application of a rule of law no longer furthers the interests it once served and “the general interest will suffer less by such departure, than from a strict adherence.” See (quoting ). In those circumstances, courts may revisit a prior precedent, providing a higher authority has not spoken on the subject. Even then, courts should not lose sight of the strong policies supporting the doctrine of stare decisis. For this reason, we are to adhere to settled rules of law “unless there exists the strongest reasons for chang[e].” . When a court contemplates departing from precedent, it should carefully balance the reasons proffered for rejecting the precedent against the very weighty considerations underlying stare decisis. The majority offers no such analysis today. Furthermore, even presuming for the sake of argument that says nothing about the validity of Rule 13.1, today this court places importance on the change in the law created by the promulgation of Rule 13.1. Before doing so, the court ought to address why it believes the en banc First Court of Appeals and the Dallas Court of Appeals erred in holding that Rule 13.1 is void, and why this court erred in citing this line of cases with approval. See ; ; . Because this court and others whose analysis this court has followed have indicated that Rule 13.1 is void, the majority errs in relying on Rule 13.1 to support its analysis. See .

For all of these reasons, the case is not on point and does not impact the analysis in this case. See

Did the Individual Defendants verify a denial that they were doing business as “W & F Transportation“?

The majority concludes that the Individual Defendants filed a verified denial of Cindy and Ricky‘s allegation that the Individual Defendants were doing business as “W & F Transportation.”8 The petition on which Cindy and Ricky went to trial alleged that the Individual Defendants were “individuals doing business as W & F TRANSPORTATION.” Most of the allegations in the petition refer to all three defendants collectively. The Lease Agreement attached to the petition is on the letterhead of “W & F Transportation.” This agreement describes the Lessee as “W & F Transportation,” and E.H. Wilhelm‘s signature is next to the words “SIGNATURE OF THE LESSEE.” The clerk‘s record contains the Individual Defendants’ responses to requests for disclosure, in which they state that the names of the parties to the lawsuit are “W & F Transportation, Inc.[,] Elward & Margaret Wilhelm.” In every pleading and motion filed by the Individual Defendants in our record, they describe the Individual Defendants as E.H. Wilhelm, Sr. and Margaret D. Wilhelm. The trial court‘s judgment, the Individual Defendants’ motion for judgment notwithstanding the verdict, and the notice of appeal all denominate the Individual Defendants in this manner as well.

Texas Rule of Civil Procedure 93 requires a verified denial of, among other things, the following matters:

2. That . . . the defendant is not liable in the capacity in which he is sued.

. . . .

14. That a party plaintiff or defendant is not doing business under an assumed name or trade name as alleged.

TEX.R. CIV. P. 93.

Cindy and Ricky‘s live petition asserted that the Individual Defendants were doing business as W & F Transportation. The evidence at trial showed that the Individual Defendants filed a certificate with the Harris County Clerk showing that the Individual Defendants were doing business under the assumed name of “W & F Transportation.”9 Many of the exhibits admitted into evidence at trial referred to the Individual Defendants’ business as “W & F Transportation.” In the answers on which they went to trial, the Individual Defendants asserted verified denials of various matters, including that the agreement attached to the petition is their written agreement or was executed by them. They also asserted a verified denial that they were liable in the capacity in which they were sued. They did not, however, assert a verified denial that they were doing business as “W & F Transportation.”

The majority concludes that the verified denial as to capacity is sufficient to deny the allegations that they were doing business as “W & F Transportation.” However, a review of the petition shows that Cindy and Ricky sought to hold the Individual Defendants liable in their individual capacities. To this end, Cindy and Ricky alleged, among other things, that the Individual Defendants were doing business as “W & F Transportation.”10 Following the jury trial, the trial court granted judgment against the Individual Defendants in their individual capacities and denied their motion for judgment notwithstanding the verdict filed in their individual capacities. The Individual Defendants have appealed to this court in their individual capacities. Therefore, their denial that they were liable in the capacity in which they were sued was a denial that they were liable in their individual capacities rather than a denial that the Individual Defendants were doing business as “W & F Transportation.” Their intention not to assert a verified denial of the latter is further corroborated by the fact that the affidavits by which the Individual Defendants verified their denials were executed by “W & F Transportation By: E.H. Wilhelm Sr.” and by “W & F Transportation By: Margaret Wilhelm.” Therefore, the Individual Defendants’ verification of their answers was an act of doing business as W & F Transportation rather than a denial that the Individual Defendants were doing business in this name.

By failing to verify by affidavit a denial of Cindy and Ricky‘s allegations that they were doing business as “W & F Transportation,” the Individual Defendants failed to deny this matter, which was admitted by operation of law without the necessity of proof. See TEX.R. CIV. P. 93(5), (14); ; . Therefore, the Individual Defendants are individually liable for all the liability of W & F Transportation. See, e.g., (holding that person doing business as “B & S Construction” was individually liable for obligations of “B & S Construction“). Thus, in addition to failing based on the absence of a complete record, the Individual Defendants’ challenges in the third and fourth issues also lack merit because the charge submitted the liability of the Individual Defendants doing business as “W & F Transportation.” Accordingly, the court should overrule the third and fourth issues.

Instead of overruling these issues, the court sustains them (as to the Individual Defendants) based on its erroneous conclusion that the verified denial as to capacity was sufficient to deny the assumed-name allegation. See . The majority relies on a Texas Supreme Court case which states that, “[i]f the jury finding is ambiguous or unclear, the courts must try to interpret the finding so as to uphold the judgment.” ; see . One obvious way to interpret the jury‘s findings to uphold the trial court‘s judgment would be to conclude that “W & F Transportation” includes the Individual Defendants because they admitted they were individuals doing business as “W & F Transportation” and because the jury had before it a certificate so stating. The court indicates that the Individual Defendants ceased doing business as “W & F Transportation” in the past and that all recent transactions and references were clearly to the corporation. See . This conclusion is not supported by the record, and furthermore, counsel for the W & F Parties stated during the charge conference that the Individual Defendants “have a corporation and they have an assumed name with other records still out with W & F Transportation—their heading is W & F Transportation.” Thus, counsel for the W & F Parties admitted at trial that the Individual Defendants were still doing business as “W & F Transportation.” This court should interpret the jury findings as assessing liability as to the Individual Defendants based on their admission (both by their failure to file a verified denial and by counsel‘s statements at the charge conference) that they were individuals doing business as “W & F Transportation” and based on the assumed name certificate. This court errs by concluding that “it is clear to us that the jury‘s findings as to ‘W & F Transportation’ referred to W & F Transportation, Inc.”11 .

Conclusion

Under the applicable common-law rule, this court should presume that the omitted portions of an incomplete trial record are relevant to the appellate issues and support the trial court‘s judgment because the common-law presumption has not been reversed by a recognized exception to this rule. The court errs in declining to do so and instead creating an exception to the general rule for unrecorded closing arguments. Likewise, the court also errs by failing to interpret the jury‘s findings so as to uphold the trial court‘s judgment and in concluding that the jury could not possibly have understood “W & F Transportation” to include the Individual Defendants. Applying existing law, this court should overrule the third and fourth issues based on the common-law presumption and, in the alternative, on the Individual Defendants’ failure to deny Cindy and Ricky‘s allegations that the Individual Defendants were doing business as “W & F Transportation.” For these reasons, the court should overrule the motion for rehearing in its entirety and affirm the trial court‘s judgment.

The ESTATE OF Marian REGIS, Deceased, by Administratrix Valerie MCWASHINGTON, Appellant,

v.

HARRIS COUNTY HOSPITAL DISTRICT d/b/a Lyndon Baines Johnson General Hospital, Appellee.

No. 14-05-00832-CV.

Court of Appeals of Texas, Houston (14th Dist.).

Oct. 10, 2006.

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Notes

1
Members of the appellate bar also filed a Brief of Amici Curiae to argue that Rule 34.6(c) and the precedent relating to partial records should not be applied.
2
The issue of the need to comply with Rule 34.6(c) was first raised by this court. On rehearing, appellees have also taken this position.
3
Although it is not clear from the record, it is also probable that the parties agreed not to record voir dire and opening statements. Assuming this is the case, our analysis applies to these nonevidentiary omissions from the record as well.
4
Texas Rule of Appellate Procedure 34.6(a)(1) defines the reporter‘s record as “the court reporter‘s transcription of so much of the proceedings, and any of the exhibits, that the parties to the appeal designate.”
5
One commentator has stated that “[t]his [common law] presumption appears to be carried forward by implication despite the repeal of former Rule 50(d), which expressly placed the burden on an appellant or other party seeking review to see that a sufficient record is created to show reversible error.” John Hill Cayce, Jr. & Anne Gardner, Civil Appeals in Texas: Practicing Under the New Rules of Appellate Procedure, 49 BAYLOR L.REV. 867, 922 (1997).
8
Texas corporations are required to have in their names one of the following words or an abbreviation thereof: “corporation,” “company,” “incorporated,” or “limited.” TEX. BUS. CORP. ACT. art. 2.05(A)(1) (Vernon 2003). One of the reasons for this requirement is to alert those doing business with the corporation to the fact that they are doing business with an incorporated entity. See . In the majority opinion, the court concludes that references to “W & F Transportation” are clearly references to “W & F Transportation, Inc.” See . This interpretation is far from obvious and is contrary to the way terms are typically viewed and understood in Texas law. In fact, given the Texas framework and nomenclature for corporate entities, it is more likely that “W & F Transportation” would be interpreted as a reference to the Individual Defendants’ unincorporated proprietorship, especially in light of their assumed-name certificate which was in effect at all material times and which was never abandoned or withdrawn. The court also states without explanation that counsel for all parties and all of the witnesses referred to “W & F Transportation, Inc.” as “W & F Transportation.” While there are many references to “W & F Transportation” in the record, in most cases it is not clear whether the speaker is referring to the corporation or the assumed name for the unincorporated proprietorship. The court appears to presume without justification that all of these references are to the corporation.
9
The court seems to imply that creating a corporation with a name similar to a previously unincorporated business run by the owners of the new corporation automatically destroys the unincorporated business and precludes the principals from ever doing business as the unincorporated entity. See . This is not the law. See, e.g., (holding that trial court could render judgment against defendant doing business under assumed names “North Texas MRI” and “White Rock MRI,” despite the contemporaneous existence of limited liability companies whose names contained the same words followed by “L.L.C.“). The court asserts that the First Court of Appeals, in , held that an assumed name certificate did not provide a basis for establishing individual liability after an entity became incorporated. See , citing . The court simply concluded, under the facts shown by the record from the bench trial, that the assumed-name certificate in question was not legally sufficient evidence to prove all the essential elements of a general partnership between the parties who signed the certificate. See .
10
The majority opinion states that, during the charge conference, the parties discussed the fact that the court‘s charge referred to W & F Transportation, Inc. See . This is not correct. Counsel for Cindy and Ricky never stated that the charge referred to W & F Transportation, Inc., and the court never indicated that the charge referred to W & F Transportation, Inc. In fact, when counsel for the W & F Parties requested a jury instruction that the charge only referred to the corporate defendant, counsel for Cindy and Ricky objected and indicated that the jury charge covered all three defendants. A review of the record of the charge conference shows that the only objection the W & F Parties distinctly pointed out to the trial court in this regard was their objection that the charge did not define “W & F Transportation” to mean “W & F Transportation, Inc.” See TEX R. CIV. P. 274 (stating that “[a] party objecting to a charge must point out distinctly the objectionable matter“). Therefore, this is the only charge objection as to which the W & F Parties preserved error. See
11
The W & F Parties assert that is on point. See . That case did not involve a partial record, and it affirmed the trial court‘s refusal to submit questions proposed by the plaintiff because they did not contain substantially correct wording. See The case is not on point.