The Quirks of Texas Post-Judgment Procedure:
In Re Elizondo, No.
17-0197 (Tex. Apr. 13, 2018) (Expiration of plenary power did not allow District Judge to correct mistake in order she had signed. Order was interlocutory but included "Mother Hubbard" language purporting to make it final).
TEXAS SUPREME COURT IMPLICITLY APPROVES OF DIRTY TRICKS
IN JUDGMENT DRAFTING
Trial court judge corrected mistake in original order, which contained Mother Hubbard Clause but shouldn't have. Ultimately to no avail. Correction was too late under the plenary power rule, and was not subject to nunc pro tunc correction because it was a judicial error, Supreme Court says. Gotcha! -- Sneaking finality language into an order that is not supposed to be final because claims by the opponent remain pending is apparently an acceptable practice now in Texas.
Finality language in interlocutory order made it final even though
it should not have
A recent opinion from the Texas Supreme Court in a mandamus
case once more illustrates that the timeline governing appeal from judgments
are rather unforgiving in Texas state courts, ensnaring the unwary and the less
than diligent, and rewarding attorneys that draft improper proposed orders and don't get caught immediately.
An order signed by the trial court granted more relief than it
should have (or rather, denied additional relief) because it stated –
erroneously—that all other relief is denied and that it is final and
appealable. It could and should have been attacked by timely post-judgment motion,
or appealed, but it wasn’t.
To challenge a final judgment entered by county courts and
district courts, the critical window is only thirty days, both for a notice of
appeal and for a post-judgment motion (for appeals from JP court, it is even less). After that, plenary power expires and
the trial court judge can no longer fix errors in the judgment even if willing
to do so unless the error is a merely clerical error that falls under the nunc-pro-tunc exception. If the judge, here (former) Harris County District Judge Patricia Kerrigan, endeavors to correct a judicial error after thirty days with nothing timely
having been filed to extend the post-judgment deadlines, the second judgment is
void because it was entered after the expiration of plenary jurisdiction.
That's what the Supreme Court determined, having the last word on the matter. Justice Keyes in the First Court of Appeals strongly disagreed on this resolution of the case. See her dissent below. Also see -- >
Dissenting opinion by Keyes in pdf on the 1st COA website. (concluding that the finality language mistakenly included in the March 11 Order did not convert that particular interlocutory order into a final judgment and that the trial court properly amended the March 11 Order to remove the Mother Hubbard clause and finality language.)
The Appellate Section of the State Bar of Texas also expressed its concerns about giving effect to false finality language, and had filed an
amicus brief to express its views to the High Court.
All to no avail.
IN THE SUPREME COURT OF TEXAS
══════════
No. 17-0197
══════════
IN RE PAUL & CYNTHIA ELIZONDO AND EAGLE FABRICATORS,
INC., RELATORS,
══════════════════════════════════════════
ON PETITION FOR WRIT OF MANDAMUS
══════════════════════════════════════════
PER CURIAM
IN RE PAUL & CYNTHIA ELIZONDO
AND EAGLE FABRICATORS, INC., Relators.
No. 17-0197.
Supreme Court of Texas.
Opinion delivered: April 13, 2018.
Robert B. Gilbreath, Ryan C. Hale, R. Scott Wolfrom, R. Kelly Donaldson, for Eagle Fabricators, Inc., Relator.
Maria De Jesus Gamez, Linda Johnson White, Nicole Killgore, Rhonda L. Allen, Karalynn C. Cromeens, for Maria De Jesus Gamez, Texas Homebuilders, LLC and M&O Homebuilders, Inc., Real Party in Interests.
Ryan C. Hale, for Paul Elizondo, and Cynthia Elizondo, Relators.
Linda Johnson White, Nicole Killgore, Rhonda L. Allen, Karalynn C. Cromeens, Orlando Cuello, for Orlando Cuello, Real Party in Interest.
On Petition for Writ of Mandamus.
PER CURIAM.
This is a mandamus action. After its plenary power had expired, the trial court issued an amended order omitting a
Lehmann-like finality phrase that it had included in its original order.
See generally Lehmann v. Har-Con Corp., 39 S.W.3d 191, 205-06 (Tex. 2001)(discussing finality phrases). The court of appeals directed the trial court to vacate the amended order. Here, the relator seeks a writ directing the court of appeals to vacate its opinion. For seventeen years, we have relied on
Lehmann to mitigate the mischief and chaos that can arise when the prospect of appeal rears its head long after the parties believed a judgment to be final. We see no need to reduce
Lehmann's ambit, and we deny Elizondo's petition for writ of mandamus.
See TEX. R. APP. P. 52.8(d).
Paul Elizondo, Cynthia Elizondo, and Eagle Fabricators, Inc. (collectively, Elizondo) hired M & O Homebuilders, Inc., Orlando Cuello, Maria De Jesus Gamez, and Texas Homebuilders, LLC (collectively, the Builders) to build a home. A cost dispute arose. Elizondo sued the Builders, asserting breach of contract, fraud, negligence, and other claims. Elizondo placed a lien on the Builders' property on the theory that the Builders had improved it using funds intended for his home. For good measure, he also applied for a temporary injunction to prevent the Builders from selling the property until the underlying litigation ended. The trial court granted the temporary injunction.
The Builders argued the lien was invalid and they filed a motion to remove it. The Builders drafted and submitted an order titled "Order on Defendants' Summary Motion to Remove Invalid Lien." The trial court signed the order, which included at the bottom of its first and only page a finality phrase that stated: "This judgment is final, disposes of all claims and all parties, and is appealable. All relief not granted herein is denied." The order left lots of relief not granted— namely, all other relief Elizondo sought against the Builders. Thirty days elapsed, marking the end of the trial court's plenary power. SeeTEX. R. CIV. P. 329b(d). Several weeks later, Elizondo noticed the original order had disposed of his entire case. He requested an amended order, which the trial court issued, this time omitting the finality phrase.
The Builders sought mandamus relief in the court of appeals, requesting a writ directing the trial court to vacate the amended order. The Builders argued that the original order was final, and that the amended order was void since the trial court issued it after the court's plenary power had expired. See id. ("The trial court . . . has plenary power to grant a new trial or to vacate, modify, correct, or reform the judgment within thirty days after the judgment is signed."). Elizondo argued that the original order was not final, and that even if it was, the finality phrase constituted a clerical error the likes of which a trial court can modify even after its plenary power expires. See id. 329b(f) (clarifying that "the [trial] court may at any time correct a clerical error in the record of a judgment and render judgment nunc pro tunc under Rule 316" (emphasis added)).
A divided panel conditionally granted the writ in favor of the Builders.
In re M & O Homebuilders, Inc., 516 S.W.3d 101, 110 (Tex. App.-Houston [1st Dist.] 2017, orig. proceeding). The majority reasoned that
Lehmann offers two independently sufficient tests under which an order rendered without a conventional trial on the merits may become final.
See id. at 106 (citing
Lehmann, 39 S.W.3d at 205-06). First, an order is final if it includes a finality phrase.
See Lehmann, 39 S.W.3d at 206 (suggesting as a finality phrase the statement that "[t]his judgment finally disposes of all parties and all claims and is appealable"). The parties do not dispute that the finality phrase in the original order is essentially the same as the finality phrase this Court suggested in
Lehmann. Second, an order is final if it actually disposes of all claims before the trial court.
See id. at 205. Importantly, in this case, the majority held that it is "necessary to review the record" only under the second test.
Homebuilders, 516 S.W.3d at 106. That is, according to the majority, the finality phrase rendered the order final and the record irrelevant.
See id. Since the order was final, the majority held that the amended order retracting the finality language was an attempt to correct judicial error, and therefore void.
See id. at 110.
In the dissent's view, the majority's result "[c]learly . . . is not intended by
Lehmann."
See Homebuilders, 516 S.W.3d at 112 (Keyes, J., dissenting). The dissent argued that the majority placed too much weight on the finality phrase, and too little weight on the trial court's later "agree[ment that] it had no intention of entering a final judgment in the case."
Id. at 111. The dissent also rejected the majority's conclusion that the finality phrase made the record irrelevant.
See id. at 115. Finally, the dissent wrote that
Lehmann and its progeny apply only in a "summary judgment or default judgment context."
Id.
Elizondo seeks a writ of mandamus directing the court of appeals to vacate its opinion. He argues that the original order was not final, and that even if it was, the trial court's inclusion of the finality phrase was a clerical error. Elizondo cites
Lehmann's statement that "whether a judicial decree is a final judgment must be determined from its language and the record in the case."
See Lehmann, 39 S.W.3d at 195. In Elizondo's view, the record in this case makes clear that the trial court did not intend to render a final judgment. Elizondo also argues that the original order is ambiguous because although its title refers to removing a lien, its body includes a finality phrase. In the alternative, Elizondo asks the Court to clarify that
Lehmann does not apply to the trial court's original order. He argues that applying
Lehmann to the original order leads to the absurd result that Elizondo loses all of his claims against the Builders. Furthermore, he argues, that result will incentivize attorneys to sneak finality language into orders that are otherwise routine.
In response, the Builders argue that the original order was final under Lehmann, which means that the amended order improperly sought to correct judicial error rather than clerical error. The Builders concede that Lehmann allows a court of appeals to look at the record, but only "[t]o determine whether an order disposes of all pending claims and parties." Id. at 205. In other words, according to the Builders, a reviewing court may not look at the record where, as here, the order includes a finality phrase. They further contend that the original order was not ambiguous on its face, and that Elizondo's argument to the contrary depends on the record. True, the order granted more relief than the Builders requested, but the Builders urge that Lehmann specifically contemplates that possibility. The windfall the Builders' received was reversible, but it was not interlocutory. See id. at 206 ("An express adjudication of all parties and claims in a case is not interlocutory merely because the record does not afford a legal basis for the adjudication. In those circumstances, the order must be appealed and reversed."). Thus, the Builders argue, the court of appeals correctly held that the trial court's original order was a final judgment.
We conclude that the court of appeals correctly applied Lehmann. Elizondo had thirty days to examine the one-page order and notice that it included a finality phrase. Even if he disagreed that the order was final, he should have treated it as though it was. See id.at 196 ("A party who is uncertain whether a judgment is final must err on the side of appealing or risk losing the right to appeal."). Had he examined the order within the thirty-day window, he could have sought an amended order or pursued an appeal. Since Elizondo waited more than thirty days to contend that the order improperly disposed of his other claims, he has lost them. Though jarring for Elizondo, this outcome reflects Lehmann's reasoning and comports with this Court's subsequent application of Lehmann's finality tests.
Our decision in In re Daredia offers guidance. See 317 S.W.3d 247 (Tex. 2010) (orig. proceeding) (per curiam). In that case, American Express sued a corporation and an individual to recover about $750,000 due on multiple credit-card accounts. The individual answered, but the corporation did not. American Express drafted a default judgment against the corporation, which the trial court signed. The judgment included a finality phrase. The time for appeal expired, and when American Express attempted to continue its case against the individual, the individual argued the judgment was final as to all of American Express's claims—not only those against the corporation, but also those against him. The court of appeals held that the judgment was ambiguous, and thus interlocutory. This Court reversed in a per curiam opinion reasoning that "[t]he court of appeals' holding that the [order's] failure to mention [the individual] creates an ambiguity" contradicted Lehmann. Id. at 249. The order in Daredia was "unequivocal, and therefore effective." Id.
Daredia's reasoning decides this case, too. Although the order in Daredia bore the title "Default Judgment," the argument that the difference in title matters overlooks the crucial trait the orders share: neither mentions the claims of which it disposes. See id at 248-49. If anything, the original order in this case is more susceptible to Lehmann's analysis because it at least mentions Elizondo; the order in Daredia did not name the individual. See id. at 248. And although in Daredia the party who authored the order suffered the harm, Daredia's reasoning depended on the finality language rather than on which party the order benefited. See id. at 249.
The court of appeals was correct that
Lehmann instructs reviewing courts to look at the record "only if the order [i]s not clear and unequivocal."
See Homebuilders, 516 S.W.3d at 106.
Lehmann said:
• "[W]hether a judicial decree is a final judgment must be determined from its language and the record in the case." Lehmann, 39 S.W.3d at 195(emphasis added).
• "[W]hen there has not been a conventional trial on the merits, an order or judgment is not final for purposes of appeal unless it actually disposes of every pending claim and party or unless it clearly and unequivocally states that it finally disposes of all claims and all parties." Id. at 205 (emphasis added).
• "To determine whether an order disposes of all pending claims and parties, it may of course be necessary for the appellate court to look to the record in the case." Id. at 205-06 (emphasis added).
Elizondo relies on the first sentence. The Builders rely on the second and third, and those sentences more accurately convey Lehmann's holding. While the first sentence appears in Lehmann's discussion of finality's history, id. at 195, the second and third sentences appear within the body of Lehmann's analysis, id. at 205-06. By implication, the second and third sentences mean that a reviewing court confronting an order that includes a finality phrase cannot look at the record. Instead, it must take the order at face value. That makes sense. If it were otherwise, finality phrases would serve no purpose. That is, if both of Lehmann's tests allow a reviewing court to look at the record, then a reviewing court may always look at the record. That would distill Lehmann's joint tests into a simple rule: when there has not been a conventional trial on the merits, a court must look to the record to determine whether the judgment is final. That is not Lehmann's rule. Had it lacked the finality phrase, the original order in this case would not have disposed of all claims and parties. However, since the original order included a finality phrase, it was clear and unequivocal.
Elizondo urges the Court to conclude that the original order is ambiguous. He contrasts the finality phrase with the original order's title, which addressed the summary removal of a lien—a proceeding he argues is not intended to be final or appealable.
See TEX. PROP. CODE § 53.160(e). The trouble is that the title and the finality phrase admit of only one construction: the order (correctly) removes a lien and (incorrectly) disposes of Elizondo's other claims. Elizondo's ambiguity argument also errs in attempting to create an ambiguity from language that
Lehmann describes as clear and unequivocal.
See Lehmann, 39 S.W.3d at 206. The order may lack a basis in law, but it is not ambiguous. Rather, the order clearly purports to dispose of all claims and all parties. Error is not the same as ambiguity.
Nor did the court of appeals reach an absurd result. Elizondo contends that Lehmannembraced the absurdity doctrine as a limit without explicitly referring to it. Even if that were true, the absurdity doctrine does not decide this case. The reason is that the doctrine is merely a presumption against absurdity, and presumptions must yield to clear and unequivocal language. But even accepting Elizondo's view of Lehmann, the outcome here was not absurd. Elizondo argues that the order could not reasonably be read as final, and that it would therefore be absurd to conclude that it was final. To the contrary, the absurd thing would be to hold that a clear and unequivocal finality phrase does not trigger Lehmann's directive that "[a] party who is uncertain whether a judgment is final must err on the side of appealing." Id. at 196. Elizondo also urges that the court of appeals' opinion generates absurdity by encouraging unscrupulous attorneys to sneak finality phrases into commonplace orders. The Lehmann rule actually helps on this front. No rule, alas, can altogether prevent unethical attorneys from acting unethically, but Lehmann discourages trickery by making it easier to spot.
In the dissent's view, the majority erred in reading the finality phrase as an indication of intent.
Homebuilders, 516 S.W.3d at 112 (Keyes, J., dissenting). Yet
Lehmann's test holds that an order is final if it "states" that it is—not if the court intends it to be.
Lehmann, 39 S.W.3d at 205. The dissent's second line of attack is that "[n]either
Lehmann nor
Daredia expands the power of . . . finality language to establish the finality of a judgment beyond the summary judgment or default judgment context."
Homebuilders, 516 S.W.3d at 115. However, "when there has not been a conventional trial on the merits,"
Lehmann's two-pronged test applies to "an order
or judgment."
Lehmann, 39 S.W.3d at 205 (emphasis added). Thus,
Lehmann and its progeny apply beyond summary and default judgments. Finally, the dissent points to
Lehmann's qualification that an "order that adjudicates only the plaintiff's claims against the defendant does not adjudicate a counterclaim, cross-claim, or third party claim."
Homebuilders, 516 S.W.3d at 115 (quoting
Lehmann, 39 S.W.3d at 205). However, the only claims that either order adjudicated were Elizondo's. The original order removed the lien that Elizondo had placed on the Builders' property, but it also denied all other relief.
Our conclusion that the original order was final also decides the issue whether the amended order was void as an attempt to correct judicial error. A trial court may correct clerical errors in a judgment even after its plenary power has expired.
See TEX. R. CIV. P. 329b(d), (f). But it must correct judicial errors within thirty days of judgment or not at all.
See Escobar v. Escobar, 711 S.W.2d 230, 231 (Tex. 1986) ("After the trial court loses its jurisdiction over a judgment, it can correct only
clerical errors in the judgment by judgment nunc pro tunc." (emphasis added)).
The trial court's inclusion of the finality phrase in the original order constituted judicial error. It is settled that "only errors made in entering a judgment are clerical; an error in rendition is judicial."
Daredia, 317 S.W.3d at 249 (citing
Escobar, 711 S.W.2d at 231). Here, as in
Daredia, the trial court signed an order that one of the parties submitted.
See Daredia, 317 S.W.3d at 249. As such, the finality phrase was part of the judgment that the trial court rendered.
See id. ("[P]rovisions alleged to have been inserted by mistake of the attorney nevertheless become a part of the court's judgment and therefore are judicial errors when thus rendered in writing by the court." (quoting
Dikeman v. Snell, 490 S.W.2d 183, 185-86 (Tex.1973))). Since the amended order sought to correct judicial error after the trial court's plenary power had expired, the amended order was void.
In sum, we conclude that the original order's finality phrase was clear, unequivocal, and neither ambiguous nor absurd. The court of appeals correctly reasoned that the finality phrase rendered the record irrelevant to determining whether the order was final. Consequently, the original order was final—"erroneous, but final."
Lehmann, 39 S.W.3d at 200. The trial court's amended order was an attempt to correct judicial error beyond the period of that court's plenary power. The amended order was therefore void. Elizondo should have raised the error while the trial court still had plenary power over the case. Alternatively, Elizondo should have appealed. Having done neither, he has lost his claims. We emphasize that parties may avoid this result by following
Lehmann's admonition to "err on the side of appealing or risk losing the right to appeal."
Id. at 196.
When a trial court issues an order or judgment without a conventional trial on the merits, Lehmann remains the rule for identifying whether the order or judgment is final. It is a rigid rule, but that is why it is useful. Although no rule can altogether prevent parties from using finality as a sword, the requirement of clear and unequivocal language makes offensive blows easy to spot.
Blunting Lehmann's blade would neither cushion finality's cuts nor reduce their number. Accordingly, we deny Elizondo's petition for writ of mandamus. See TEX. R. APP. P. 52.8(d).
DISSENT BY JUSTICE KEYES IN THE COURT OF APPEALS THAT ENTERTAINED THE MANDAMUS PETITION IN THE FIRST INSTANCE
(challenging the Trial Court's correction order)
Evelyn V. Keyes Justice, Dissenting.
The majority holds that the trial court's "Order on Defendants' Summary Motion to Remove Invalid Lien" that removed a lien and assessed attorney's fees is actually a final judgment because the Order mistakenly contained a Mother Hubbard clause and finality language that called the Order a "final judgment" that disposed of all claims and parties and was appealable. The majority holds that the mistake was not a clerical error but a judicial error that was discovered and corrected outside the trial court's period of plenary power; therefore, the case was dismissed, was not 111*111 timely appealed, and cannot be resurrected. It thus vacates the trial court's order correcting the error, and it reinstates the order removing the lien as the final and appealable judgment of the trial court on the untried merits of the case.
Background
This dispute arises out of the cost of construction of a home under a contract between Paul Elizondo, the homeowner, and the builder, M & O Homebuilders, Inc., Orlando Cuello, Maria De Jesus Gamez, and Texas Homebuilders, LLC (collectively, "M & O"). Elizondo filed suit against M & O for negligence, breach of contract, breach of warranty, fraud and misrepresentation, deceptive trade practices, conversion, conspiracy, and fraudulent conveyance. Elizondo also filed a lis pendens and, later, a lien on property owned by M & O, alleging that a structure on the property was likely built using misapplied construction trust funds from the construction of Elizondo's home. Elizondo then filed an application for a temporary injunction to prevent M & O from selling, transferring and/or encumbering the property until completion of this litigation, which the trial court granted.
M & O filed a "Summary Motion to Remove an Invalid Lien" under Property Code section 53.160 and sought to recover damages and its attorney's fees under the Fraudulent Lien Act, Civil Practice and Remedies Code section 12.002. The motion alleged that Elizondo's lien on M & O's property was defective and without legal basis. Elizondo agreed that the lien was no longer necessary with the temporary injunction in place. M & O submitted a proposed "Order on Defendants' Summary Motion to Remove Invalid Lien." The Order, which the trial court signed on March 11, 2016, stated that the court was "of the opinion that Judgment should be rendered for Plaintiff" — Elizondo. However, it actually ordered the lien removed and awarded the defendant, M & O, its attorney's fees on the motion. The Order also contained a Mother Hubbard clause and finality language, which stated, "This judgment is final, disposes of all claims and all parties, and is appealable. All relief not granted herein is denied."
In late April, Elizondo asked the trial court to correct the Order by removing the finality language that had admittedly been included by mistake in the proposed order. The trial court agreed it had no intention of entering a final judgment in the case and signed an "Amended Order" on May 9, 2016, deleting the Mother Hubbard clause and the finality language. M & O contends the trial court was without plenary power to sign the amended order. The majority agrees and declares that the error was a judicial error and not a clerical error, that the order could not be amended after the trial court lost its plenary power thirty days after entry of the incorrect March 11, 2016 Order, and that, therefore, the entire case was dismissed on the merits by that incorrect order and cannot be resurrected. I strongly disagree.
Discussion
The majority bases its entire opinion on its wholly unjustified conclusion that the correctly named "Order on Defendants'
112*112 Summary Motion to Remove Invalid Lien" was actually a
final judgment on the merits of the case. It observes that a trial court has plenary power to grant a new trial or to modify a judgment only within thirty days after the judgment is signed, although the trial court "may at any time correct a clerical error in the record of a judgment and render judgment nunc pro tunc under Rule 316."
See TEX. R. CIV. P. 329b(d), (f). It then reasons that the March 11 Order is a final judgment "because it contains an unequivocal expression of the trial court's intent to dispose of the case" — namely the Mother Hubbard clause and finality language; and because the Order contains this language it is a final judgment that disposes of the case on the merits.
SeeOp. at 104-05. Following this circular reasoning, the majority concludes that the Mother Hubbard clause and finality language cannot be a mistake or a clerical error subject to correction nunc pro tunc.
See Op. at 110. On this reasoning, any order on any motion that mistakenly includes a Mother Hubbard clause and finality language — even a motion for extension of time, or a motion to abate, or a motion to dismiss counsel — is automatically converted into a final judgment on the merits of the case. Clearly this result is not intended by
Lehmann.
Every aspect of the majority opinion depends on the majority's determination that the order entered by the trial court removing the lien placed by Elizondo on M & O's property is a final judgment because it contains a Mother Hubbard clause and finality language. But the majority reaches this conclusion on reasoning that is, in fact, directly contrary to Lehmann.
First, the majority mischaracterizes M & O's motion as a motion for "a partial summary judgment." Op. at 106. But its own opinion belies this characterization of the motion. The majority states:
M & O sought to remove the lien under § 53.160 of the Texas Property Code and to obtain actual damages or $10,000, as well as attorney's fees and exemplary damages, under the Fraudulent Lien Act. M & O sought to remove the lien on the grounds that Elizondo was not the proper person to file a lien, misapplication of construction trust funds was not a valid basis for a lien, and the lien was fraudulent. M & O gave 21 days' notice before the date of the hearing, as required by the statute. The trial court's March 11 order granted the motion, without stating the grounds, and awarded M & O attorney's fees in the trial court and on appeal.
Op. at 107 n.9 (internal citations omitted).
M & O did not seek a "partial summary judgment" by filing a summary motion to remove the lien placed by Elizondo; nor are proceedings under section 53.160 treated as summary judgment proceedings under Texas Rule of Civil Procedure 166a. The statutes relating to summary removal of an invalid or unenforceable lien do not dispose of any claims or parties, as a summary judgment or partial summary judgment may.
A party may file a motion for summary removal of an invalid or unenforceable lien in a suit brought to foreclose a lien or to declare a claim or lien invalid or unenforceable. TEX. PROP. CODE ANN. § 53.160(a) (West 2014). The movant must provide at least twenty-one days' notice of the hearing on the motion.
See id. § 53.160(c). At the hearing, the lien claimant bears the burden of proving notice of the claim and affidavit of lien was provided pursuant to Property Code Chapter 53, and the movant bears the burden of establishing that the lien should be removed for one of seven specific grounds listed in section 53.160.
See id. § 53.160(b), (d). If the trial court determines that the movant is not
113 entitled to removal of the lien, the court shall enter an order denying the motion, and if the court determines that the movant
is entitled to removal, the court shall enter an order removing the lien.
Id. § 53.160(e);
see Big H. Constr., Inc. v. Hensley, No. 01-10-00379-CV, 2011 WL 1233594, at *2 n.2 (Tex. App. — Houston [1st Dist.] 2011, no pet.) (stating that in section 53.160 proceeding, trial court is only authorized to remove lien and may not invalidate parties' contract or summarily rule on other claims raised by parties). That is all that a summary proceeding to remove a lien does.
Section 53.160 and the two statutes that follow it in the Property Code contemplate that a ruling on a summary motion to remove a lien does not finally resolve any of the issues between the parties. Section 53.160(e) expressly recognizes that an order on a summary motion is interlocutory and may not be appealed. TEX. PROP. CODE ANN. § 53.160(e). Section 53.160(f) provides that any admissible evidence offered at the hearing on the summary motion may be admitted in the trial on the merits of the parties' claims, but the trial court's order on the summary motion "is not admissible as evidence in determining the validity and enforceability of the claim or lien." Id. § 53.160(f). This section thus unequivocally ensures that a ruling on a summary motion to remove an invalid or unenforceable lien is not to be understood as a final disposition of the lien's validity or enforceability.
Furthermore, section 53.161 — governing bond requirements after entry of an order to remove a lien — provides that, in an order removing a lien, the trial court shall set the amount of security the lien claimant must provide to stay removal, and the amount must be a reasonable estimate of the costs and attorney's fees the movant is likely to incur in the proceeding to determine the validity or enforceability of the lien. Id. § 53.161(a) (West 2014). Additionally, section 53.162 provides that if a removal order is not stayed and the lien claimant later obtains a final judgment in the suit establishing the validity of the lien, the final judgment revives the removed lien, and the claimant may foreclose on the lien. Id. § 53.162(a)-(b) (West 2014). These two statutes thus also contemplate that proceedings concerning the lien's validity — to say nothing of proceedings related to other claims between the parties — will continue after the trial court rules on the summary motion to remove the lien. That is exactly the opposite of the majority's ruling on the scope and effect of the "Order on Defendants' Summary Motion to Remove Invalid Lien" in this case.
The majority also states that the March 11 order removes the lien and awards attorney's fees. Op. at 108-09. And, it observes that the order "contains finality language almost identical to the language the Lehmann Court held would unequivocally express the intent to render a final judgment disposing of all parties and claims." Op. at 109. As a result, it holds that the order "is final even if it grants more relief than was sought or intended." Op. at 108.
The lesson the majority takes from Lehmann is, in fact, exactly the opposite from that actually taught. The supreme court said it best:
In the past we have tried to ensure that the right to appeal is not lost by an overly technical application of the law. Fundamentally, this principle should guide in determining whether an order is final. Simplicity and certainty in appellate procedure are nowhere more important than in determining the time for perfecting appeal. From the cases we have reviewed here, we conclude that when there has not been a conventional trial on the merits, an order or judgment is not final for purposes of appeal 114*114 unless it actually disposes of every pending claim and party or unless it clearly and unequivocally states that it finally disposes of all claims and all parties. An order that adjudicates only the plaintiff's claims against the defendant does not adjudicate a counterclaim, cross-claim, or third party claim, nor does an order adjudicating claims like the latter dispose of the plaintiff's claims. An order that disposes of claims by only one of multiple plaintiffs or against one of multiple defendants does not adjudicate claims by or against other parties. An order does not dispose of all claims and all parties merely because it is entitled "final", or because the word "final" appears elsewhere in the order, or even because it awards costs. Nor does an order completely dispose of a case merely because it states that it is appealable, since even interlocutory orders may sometimes be appealable. Rather, there must be some other clear indication that the trial court intended the order to completely dispose of the entire case. Language that the plaintiff take nothing by his claims in the case, or that the case is dismissed, shows finality if there are no other claims by other parties; but language that "plaintiff take nothing by his claims against X" when there is more than one defendant or other parties in the case does not indicate finality.
To determine whether an order disposes of all pending claims and parties, it may of course be necessary for the appellate court to look to the record in the case. Thus, in the example just given, if the record reveals that there is only one plaintiff and only one defendant, X, the order is final, but if the record reveals the existence of parties or claims not mentioned in the order, the order is not final. On the other hand, an order that expressly disposes of the entire case is not interlocutory merely because the record fails to show an adequate motion or other legal basis for the disposition. The record may help illumine whether an order is made final by its own language, so that an order that all parties appear to have treated as final may be final despite some vagueness in the order itself, while an order that some party should not reasonably have regarded as final may not be final despite language that might indicate otherwise.
Here, the majority does exactly the opposite of what the
Lehmann court instructed reviewing courts to do. It "ensure[s] that the right to appeal is ... lost by an overly technical application of the law."
Id. at 205. It concludes, directly contrary to
Lehmann,"that when there has not been a conventional trial on the merits," an order
is final for purposes of appeal even though it does
not "actually dispose[ ] of every pending claim and party."
Id. And this is the case even though the Order patently does not dispose of a
single claim on the merits; even though, as an order pursuant to a summary proceeding under Property Code section 53.160 it
could not do so; and even though it contains contradictory language as to which party even prevailed on the motion — plaintiffs or defendants.
[1]
115The majority disregards the supreme court's admonitions in
Lehmann that "[a]n order that adjudicates only the plaintiff's claims against the defendant does not adjudicate a counterclaim, cross-claim, or third party claim, nor does an order adjudicating claims like the latter dispose of the plaintiff's claims" and that "[a]n order does not dispose of all claims and all parties merely because it is entitled `final', or because the word `final' appears elsewhere in the order, or even because it awards costs."
Id. Rather, it decides that the trial court's "Order" on M & O's "Summary Motion to Remove Invalid Lien," which only removes the lien placed by Elizondo and grants attorney's fees, actually disposes of the entire case on the merits —
none of which were before the trial court or adjudicated at the time.
The majority also disregards the supreme court's instruction that "[t]o determine whether an order disposes of all pending claims and parties, it may of course be necessary for the appellate court to look to the record in the case." Id. at 205-06. The record here demonstrates that the March 11 Order is "an order that some party should not reasonably have regarded as final ... despite language that might indicate otherwise." Id.at 206. Therefore, I cannot agree that the majority has construed Lehmann correctly or has followed its guidance. I believe it has done just the opposite.
Nor do I agree with the majority's reliance on
In re Daredia as support for its determination that the March 11 Order removing Elizondo's lien is a final judgment that disposes of the case on the merits.
See 317 S.W.3d 247 (Tex. 2010) (per curiam).
Daredia applied
Lehmann in the context of a default judgment entered in a credit card issuer's collection action against a corporation and an individual.
Id. at 248. The default judgment did not reference the individual, but recited the default of the corporation, awarded damages and attorney fees against the corporation, and stated that the judgment disposed of all parties and all claims and was therefore final.
See id. No one appealed.
Id. The credit card company moved to reopen the case fifteen months later to proceed against the individual, seeking a correction in the judgment nunc pro tunc.
Id.The supreme court held that the default judgment, which recited that it was a final judgment and disposed of all parties, was, in fact, a final judgment that could not be corrected nunc pro tunc.
Id. at 249. The court stated that "the language of the judgment in this case clearly and unequivocally indicates that it is intended to be final" and that dismissal of the individual, although perhaps inadvertent, was "nonetheless unequivocal, and therefore effective."
Id.
Neither
Lehmann nor
Daredia expands the power of a Mother Hubbard clause and finality language to establish the finality of a judgment beyond the summary judgment or default judgment context. Nor do any of the other cases cited by the majority expand the power of a Mother Hubbard clause and finality language that was admittedly included in a form order by mistake to confer final judgment status to statutory interlocutory orders on collateral matters having nothing to do with the merits of the case. The summary motion for removal of an invalid or unenforceable lien pursuant to Property Code section 53.160 is fundamentally different from a summary judgment, a default judgment, or any of the cases cited by M & O in which
116*116 Mother Hubbard clauses have been used to create a final judgment, all of which involved parties seeking final disposition of an aspect of their case.
[2]
For all of the foregoing reasons, I believe that the majority opinion in this case is erroneous and creates unsustainable precedent in the First Court of Appeals. I would follow what I believe to be the correct interpretation of Lehmann and Daredia, which is contrary to the majority's opinion. I would conclude that the finality language mistakenly included in the March 11 Order did not convert that particular interlocutory order into a final judgment and that the trial court properly amended the March 11 Order to remove the Mother Hubbard clause and finality language.
CONCLUSION
I would deny M & O's petition for writ of mandamus.
