Texas Appellate Law Blog : Texas Appellate Lawyer & Attorney : Smith Law Group, P.C. : Appeals, Sanctions, Summary Judgment : Austin, Texas

In Apache Bohai Corp. v. Texaco China BV, the Fifth Circuit has rejected claims that an arbitrator exceeded his powers and manifestly disregarded the law in rendering an award exceeding $71 million.

No surprise here, really.  Except in the most egregious of circumstances, arbitration awards can't be busted.  No matter how well advised, clients have a difficult time accepting that these things are won or lost at the arbitration hearing.

Now seems like an appropriate time to emphasize that contracting parties wanting to include an arbitration clause may hedge their bets by bargaining for expanded judicial review, at least under current Fifth Circuit and Texas law.  Employing this approach, the parties either alter the scope of review and thus allow courts greater leeway than what the arbitration statute provides, or they contract for a second layer of arbitration in which a panel of "appellate arbitrators" reviews the initial award.  A recent St. Mary's Law Journal article (38 St. Mary's L.J. 471) explains these concepts, as does a similar article in the forthcoming issue of The Appellate Advocate, which should arrive in State Bar Appellate Section members' mailboxes any day.

Full disclosure:  Some very fine lawyers at my former firm were involved in the Apache Bohai case, but I did not work on the appeal.

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The State Bar Appellate Section and TexasBarCLE are offering a total of $95 off the combined registration fees for the 2007 Practice Before the Texas Supreme Court and Advanced Civil Appellate Practice courses.  To get this deal, attendees must register by telephone (800-204-2222 x1574), fax (512-427-4111), or mail by April 13, 2007.  (Unfortunately, online registration is not available, and I was unable to locate an online brochure for either seminar.)  Appellate Section and State Bar College members get an additional $25 off. 

These courses, along with the annual UT Conference on Federal and State Appeals, are some of the best and most informative CLEs around.  I would encourage anyone interested in appellate practice to attend.

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Reaction to last week's U.S. Supreme Court decision in Philip Morris USA v. Williams (referenced here) has been interesting, to say the least.  Early on, the feedback seemed universally negative.  For an example, check out this editorial from The New York Times.

More recently, at least two commentators have managed to find a silver lining in the Court's ruling.  Over at Blawgletter, Barry Barnett observed that the decision, by turning on jury instructions rather than imposing a bright line rule on the ratio between actual and punitive damages, effectively "affirmed the jury's primacy in determining appropriate punishment," potentially signaling a "healthy reluctance on the Court to undo the work of juries."

Taking a different slant, Law.com's Howard Bashman went so far as to proclaim the ruling "good news for plaintiffs who don't win the race to be first to obtain punitive damages against a defendant whose conduct has harmed many" because "the defendant will no longer be able to persuasively argue that earlier punitive damages awards aimed at punishing the same conduct at issue in the current plaintiff's lawsuit extracted a punishment sufficient to mandate the dismissal of that particular plaintiff's punitive damages claim."

These days, the silver lining is getting harder and harder to find.  I am grateful that someone is still looking.

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Yesterday's post at the Texas Law Blog has reinvigorated my interest in the "Small Is the New Big" discussion emanating from Seth Godin's original blog post and book by that title.  Other bloggers have discussed this concept in great detail, but the thumbnail version is that technology and a commitment to more personal service are allowing small businesses (including law firms) to compete with the corporate giants.  As a sole practitioner and former BigLaw attorney, I find this idea fascinating.

Extending the concept further, the Virtual Lawyer recently predicted a future in which "there will be big firms and small firms, but few in the middle.  "If that holds true, what will it mean for my practice?  Hopefully, in addition to validating my current career path, it will present an opportunity to work with an even broader network of lawyers than I do now.

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The Supreme Court of Texas issued three per curiam opinions with today's orders:

In Hood v. Wal-Mart Stores Inc., the Court held that the court of appeals erred by dismissing the appeal without providing an opportunity to cure when the plaintiff filed an indigence affidavit within the time the appeals court gave him to pay the filing fee or face dismissal.

In In re Bank One, N.A., the Court held that an arbitration clause incorporated by reference on a bank signature card was enforceable and that the bank did not waive its right to arbitrate by moving to set aside a default judgment and seeking a new trial.

In City of Houston v. Williams, the Court rejected a declaratory judgment action complaining about deductions from payments retired firefighters received upon termination as a claim for money damages for which governmental immunity had not been waived.

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The State Bar's Friday Update reports that Senator Robert Duncan has filed two judicial selection bills.  The first, Senate Bill 806, allows for appointment of certain judicial offices and nonpartisan retention elections.  The second, Senate Joint Resolution 32, proposes a related constitutional amendment.

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In Morales v. Barnett, the Third Court of Appeals has affirmed the trial court's order dismissing a wrongful death suit against the Luling Independent School District on the ground that sovereign immunity had not been waived.  The court of appeals held that the incident did not "arise[] from the operation or use of a motor-driven vehicle" for purposes of the Tort Claims Act (Tex. Civ. Prac. & Rem. Code § 101.021(1)) because the district's jurisdictional evidence negated any causal nexus between a coach's use of hazard flashers while parked beside the road and an athlete's death from being struck by another car.  The appellate court further concluded that the coach's decisions were supervisory in nature and thus could not give rise to a waiver of immunity.

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Chief Justice Jefferson's State of the Judiciary address has been posted at the Texas Supreme Court's web site.

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I can't wait to see what Texas Lawyer has to say about Chief Justice Jefferson's State of the Judiciary address.  I'm sure there will be some interesting quotes about how the Chief has gone over to the dark side or has seen the light, depending on where the interviewee stands on what now passes for tort reform.

I am skeptical of any cause advanced by Texans for Lawsuit Reform, the same happy people who brought you House Bill 4 two sessions ago.  The face of civil litigation has changed tremendously since then.  Most litigators I know would say that the change has not been for the better.

As I read Chief Justice Jefferson's comments, however, they make a lot of sense.  Our multi-level, overlapping court system is confusing, even to practicing lawyers.  If the legislature can streamline the system and make it more efficient, should we fear that result, just become TLR advocates it?

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The online version of The Austin American-Statesman has this report on Chief Justice Jefferson's State of the Judiciary address to the Texas Legislature today.  According to the article, the Chief called upon lawmakers to review the state's judicial structure and "the growing use of private dispute resolution to settle legal disputes outside the public courts."  In keeping with his platform from last session, the Chief also urged the legislature to establish a commission to review judicial salaries.  The article suggests a connection between the Chief's agenda and changes "being pushed by Texans for Lawsuit Reform, a lobby group with considerable political clout, through Jefferson said his were unrelated."

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In Philip Morris USA v. Williams, the United States Supreme Court has reversed a $79.5 million punitive damage judgment on the ground that it unconstitionally punished Big Tobacco for harming nonparties to the suit. SCOTUSBlog has summarized the 5-4 ruling here.

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This oral argument outtake, like the one posted here, comes from Reliance National Indemnity Co. v. Advanced Temporaries, Inc., argued before the Texas Supreme Court on October 18, 2006:

Counsel:  May it please the Court, counsel.  I am just thrilled as I can be to be here.  I've been doing this for 21 years, and I'm finally in front of the Supreme Court.

Justice Medina [at conclusion of argument]:  Was it worth the 21-year wait?

Thanks again to Pam Baron!

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The Texas Supreme Court issued a short set of orders today that included opinions in two cases against Dallas County consolidated for oral argument.

In Dallas County v. Wiland, the Court held that deputy constables who had been dismissed without a hearing were protected by civil service rules and could not be fired without cause, were denied procedural due process, were entitled to damages unless cause existed to fire them, and were not entitled to substantive due process.  Justice Brister, joined by three others, concurred and dissented in part.

The Court reached the same result in the companion case, Dallas County v. Walton, even though the deputy constable had signed a statement that his service was at-will and would terminate when the constable's term expired.  The same group of justices concurred.

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In Baker Botts, L.L.P. v. Cailloux, the Fourth Court of Appeals has reversed a $65.5 million judgment against Baker Botts and Wells Fargo Bank based on jury findings that the defendants breached fiduciary duties to a widow who voluntarily disclaimed her right to her husband's share of their marital estate.  After concluding that the plaintiff presented no evidence of causation and that the trial court abused its discretion by imposing an "equitable trust" on the defendants, the appellate court rendered a take-nothing judgment.

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Over at Legalwriting.net, Wayne Schiess has posted his observation that many lawyers fail to use an "apostrophe + s" to create the possessive of a word already ending in "s."  Professor Schiess notes a connection between this tendency and newspapers' use of this form.  (Yes, it's OK to use only an apostrophe when the word is already plural.)

I admit that I sometimes backslide when writing "court of appeals" as a possessive.  "The court of appeals's ___" often seems awkward and too attention-grabbing.  Other than to rewrite the sentence to avoid the possessive (which tends to create passive voice problems), I haven't come up with a satisfactory solution.  Fortunately, Professor Schiess seems to have given those struggling with this issue a free pass.

The notion that newspapers can influence legal writing reminds me of Roger Hughes's piece in The Appellate Advocate called Legalese in the Age of IM (Instant Messaging).  If newspapers hold that kind of sway, how long will it bebefore we start seeing IM slang in legal briefs?  If Roger's tongue-in-cheek prediction holds true, it's only a matter of time.

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In Cox Newspapers, L.P. v. Penick, a media defendant's interlocutory appeal from an order partially denying summary judgment, the Third Court of Appeals has held that a former Bastrop County district attorney presented no evidence that one of several newspaper articles about a murder trial he prosecuted was "of and concerning" him (as required under New York Times v. Sullivan) or that the remaining articles were published with actual malice.  Accordingly, the appellate court reversed that portion of the district court's order denying summary judgment on these articles and rendered judgment that the former district attorney take nothing from the newspaper.

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Over at Blawgletter, Barry Barnett has an interesting post about Friday's Norris v. Thomas decision from the Texas Supreme Court:

Blawgletter can't help but wonder whether Gilligan—he of Gilligan's Island (1964-67) fame—could have earned homestead protection for S.S. Minnow, the tiny ship that a storm wrecked 40-plus years ago on a desert island nowhere near Texas.  Unlike the Norris's vessel, The Minnow lacked electricity, running water, and other amenities of modern life.  Plus nobody lived in it; Gilligan, the Professor, et al., dwelled in grass huts.  But S.S. Minnow never got off of dry land (except perhaps for that one episode when the castaways tried to patch and sail it).

Barry "despairs at the court's homestead decision," not because of the outcome, but because neither the majority nor the dissent identified the "craft-and-domicile" by name.  After digging around on PACER, Barry determined that the boat was a 1975 Chris Craft Roamer, which the Norrises had christened Cricket.

Somewhere, I can hear the Skipper shouting, "Gill-i-gan!!!"

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Today's Texas Supreme Court orders show that last week's prediction of at least four opinions wasn't totally off base.

In Norris v. Thomas, on a certified question from the Fifth Circuit, the Court determined that a houseboat did not qualify for the Texas Constitution's homestead exemption because it is a moveable chattel that does not rest "on the land," as the exemption requires.  Justice O'Neill dissented, along with Justices Wainwright, Brister, and Medina.

In Wachovia Bank v. Gilliam, a restricted appeal, the Court vacated a default judgment because the court of appeals erroneously presumed that substituted service complied with statutes requiring suit papers to be forwarded to the defendant's "home office" or "principal office."

In State Farm Life Insurance Co. v. Martinez, the Court held that statutory penalties for failing to timely pay policy proceeds were properly imposed before the insurer sought interpleader, but were improper after that.  The Court further held that allowing the beneficiary to recover prejudgment interest as well as interest accrued while the proceeds were in the trial court's registry would be an imermissible double recovery.

In Jack in the Box, Inc. v. Skiles, the Court held the an employer had no duty to warn its employee, a truck driver injured when he fell into a trailer after using a ladder to climb over an inoperable lift gate, because the employee had been trained to handle situations when the lift would not operate and because the danger was common and obvious.

In City of San Antonio v. TPLP Office Park Properties, the Court held that the City's decision to close a driveway from a residential street to an office development accessible from other points was a valid exercise of its police powers, that the City could not be estopped from closing the driveway (which it had previously approved), and that that the City did not "take" from the development by diverting traffic from other driveways into the office park.

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With the legislature in session here in Austin, the buzz has begun.  A number of potential bills, if filed and passed, would affect appellate practitioners dramatically.  Here is a summary of what could be on the agenda for this session:

• an amendment to the general interlocutory appeal statute authorizing appellate review of all controlling questions of law at the will of any party;
• an amendment to the Texas Arbitration Act providing for a meaningful appeal on questions of law or fact in arbitration proceedings;
• an omnibus court reorganization statute that would combine the Texas Supreme Court and the Court of Criminal Appeals or reduce the number of justices from 9 to 7 on each court;
• appellate redistricting (which could include the demise of the Corpus Christi, El Paso, and Texarkana appellate courts) and elimination of overlapping appellate districts; and
• providing the Texas Supreme Court with discretionary jurisdiction in appeals of all final judgments and appealable interlocutory orders.

Texans for Lawsuit Reform is aggressively pursuing many of these measures.

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Today's State Bar Friday Update reports that the chief justices of all Texas appellate courts presented their budgets to the Senate Finance Committee yesterday.

The report also mentions that Chief Justice Jefferson will give the State of the Judiciary address at 11:00 a.m. on February 20, 2007.  This event will take place in the House Chamber and is open to the public.  A live audio link is available here.

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Yesterday's prediction was way off, although the Texas Supreme Court did release its first opinion of 2007 with today's orders.  In United Services Automobile Association v. Brite, the Court held that a claim for front pay must be included when determining whether a case meets the amount-in-controversy requirement for a limited jurisdiction court.  Because a divided panel of court of appeals concluded otherwise, the supreme court reversed and dismissed the case for want of jurisdiction.

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In Railroad Commission of Texas v. Coppock (on motion for rehearing), the Third Court of Appeals has reversed a district court's determination that the Commission's basis for extending a surface coal mining permit that the miner lacked a market for selling its coal was not authorized under the Texas Natural Resources Code.

The merits of this case are something only an administrative lawyer could love.  A straightforward procedural issue is what grabbed my attention.  The Third Court panel glossed over the appellants' position that an argument characterized as an independent ground for affirmance could not be heard because the appellees did not file their own notice of appeal.  See Tex. R. App. P. 25.1.  Instead of deciding whether Rule 25.1 was in play, the panel addressed the merits of the appellants' argument "[i]n the interests of justice."  What's more, because the court reversed on another ground, the entire discussion is arguably dicta.

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I'm going to go out on a limb here and predict that the Texas Supreme Court will issue at least four opinions tomorrow.  (The last ones came out on December 29, 2006.)  Tune in to find out whether my prediction has come true.

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