Global Terminaling Services, Inc. f/k/a Pabtex, Inc. v. Don M. Kennedy--Appeal from 280th District Court of Harris County

11th Court of Appeals

Eastland, Texas

Memorandum Opinion

Global Terminaling Services, Inc. f/k/a Pabtex, Inc.

Appellant

Vs. No. 11-02-00038-CV -- Appeal from Harris County

Don M. Kennedy

Appellee

Don M. Kennedy sued Global Terminaling Services, Inc. f/k/a Pabtex, Inc. to recover attorney=s fees allegedly owed to him by Global. Global counterclaimed and sought the recovery of attorney=s fees it had already paid to Kennedy in two particular cases. The parties sought to settle the disputes at issue in this case and entered into an agreement under TEX.R.CIV.P. 11 whereby each party was to take nothing from the other. The trial court signed the final judgment as proposed, approved, agreed to, and tendered by the parties; but the trial court sua sponte inserted the following language at the end of the judgment:

All relief not granted is Denied as to all claims by or against all parties, whether named in this judgment or not.

Global appeals. We reverse and remand.

Conformity of the Judgment with the Agreement

In its sole issue on appeal, Global argues that the trial court erred by inserting provisions into the agreed judgment that were not agreed to by the parties. Global filed a motion to modify, correct, and reform the judgment to delete the insertion made by the trial court because it had not agreed to that language and because the language could potentially affect other claims involving the parties. Also, at the hearing on the motion, Global=s counsel expressed concern about the effect the inserted language would have on other controversies involving the parties to this suit. The trial court denied Global=s motion, stating that it had inserted the language merely to ensure that the judgment in this case was a final judgment as the parties intended.

A final judgment that is founded upon a settlement agreement reached by the parties must be in strict or literal compliance with the terms of the settlement agreement. Vickrey v. American Youth Camps, Inc., 532 S.W.2d 292 (Tex.1976). The specific terms of the agreement were that Kennedy recover nothing on his claim against Global for attorney=s fees for representing Global in a particular case against the Port of Houston Authority of Harris County and that Global recover nothing on its claim for recoupment of attorney=s fees paid to Kennedy for representing Global in two specific lawsuits -- one against the Port of Houston Authority of Harris County and the other against Applied Industrial Materials Corporation. We express no opinion as to the effect of the language inserted by the trial court in an attempt to ensure the finality of the judgment. However, because the insertion does not constitute a mere clerical error, we must reverse the judgment and remand the cause so that the trial court can delete the language that does not strictly and literally comply with the terms of the parties= settlement agreement and proposed agreed judgment. See Patel v. Eagle Pass Pediatric Health Clinic, Inc., 985 S.W.2d 249, 252-53 (Tex.App. - Corpus Christi 1999, no pet=n); McLendon v. McLendon, 847 S.W.2d 601 (Tex.App. - Dallas 1992, writ den=d); see also Vickrey v. American Youth Camps, Inc., supra.

Kennedy=s Claim of Frivolous Appeal

In his brief, Kennedy asserts that this appeal is spurious and that Global should be sanctioned for filing a frivolous appeal. See TEX.R.APP.P. 45. We disagree. If an appellant=s argument on appeal has a reasonable basis in law and constitutes an informed, good faith challenge to the trial court=s judgment, sanctions are not appropriate. General Electric Credit Corporation v. Midland Central Appraisal District, 826 S.W.2d 124, 125 (Tex.1991). We hold that Global=s appeal had a reasonable basis in law and constituted a good-faith challenge to the judgment of the trial court. Kennedy=s request for damages under Rule 45 is overruled.

This Court=s Ruling

The judgment of the trial court is reversed, and the cause is remanded to the trial court for further proceedings consistent with this opinion.

TERRY McCALL

January 16, 2003 JUSTICE

Panel consists of: Arnot, C.J., and

Wright, J., and McCall, J.