In re Charles D. Messervey Trust, Charles D. Messervey d/b/a Art Images--Appeal from 225th Judicial District Court of Bexar County

heading for mandamus No. 04-00-00700-CV
IN RE CHARLES D. MESSERVEY TRUST,

Charles D. Messervey d/b/a Art Images

Original Proceeding

Related Trial Court Nos. 97-CI-06922 & 97-CI-14613

From the 225th Judicial District Court, Bexar County, Texas

Honorable John J. Specia, Jr., Judge Presiding

Opinion by: Paul W. Green, Justice

Sitting: Catherine Stone, Justice

Paul W. Green, Justice

Sarah Duncan, Justice

Delivered and filed: January 24, 2001

WRIT OF MANDAMUS DENIED IN PART AND CONDITIONALLY GRANTED IN PART

In this mandamus action, we are asked to vacate the order of the trial court abating the underlying state civil lawsuit pending the outcome of a federal criminal prosecution. Because we find the abatement overbroad, we conditionally grant the writ in part.

Background

The underlying trial court case arises out of an insurance dispute. In 1996, Charles Messervey made a claim for insurance benefits based on losses from a theft of certain art from his residence. The defendant insurance company, Northbrook Property and Casualty Insurance Company (Northbrook), denied the claim, alleging Messervey committed fraud by attempting to recover for more items than he actually owned. On May 12, 1997, Messervey filed suit against Northbrook.

On April 23, 1998, Messervey was indicted in federal court on several counts of mail fraud stemming in part from the alleged theft and insurance claim. The United States intervened in the civil case on August 8, 1998, to limit the discovery of information and witnesses vital to the prosecution of the pending federal criminal prosecution. On June 2, 1998, the trial court stayed all discovery in the civil case for 90 days. On June 16, 1998, the trial court lifted the stay. On July 28, 1998, the trial court abated the civil proceeding, this time at the request of Messervey based on his assertion of 5th Amendment rights. On September 9, 1998, the abatement was lifted; however, the parties disagree about the extent of the court's order. Messervey claims the abatement was lifted only to allow discovery to proceed; Northbrook contends the proceeding was allowed to go forward in its entirety. (1)

On August 11, 1999, Messervey was convicted by a jury on all counts of the federal indictment, two of which relate to his claim under the policy with Northbrook. At the time this mandamus action was filed, Messervey was still awaiting sentencing on the convictions.

On June 19, 2000, Northbrook filed a motion for summary judgment. Messervey filed a motion for continuance, objections, special exceptions, a motion to strike the hearing, and a motion for leave to file a late response. Messervey also sent notices of deposition for Assistant United States Attorneys Jack Stick and Margaret Embry and FBI Special Agent Jeff Allovio. Messervey argued recently discovered evidence of government threats and coercion made it necessary to depose Stick, Embry and Allovio, in addition to certain witnesses who testified in the federal criminal trial.

Following a July 14 hearing, the trial court entered an order (the July 27 order) with the following provisions:

1) the summary judgment and all related objections, special exceptions, etc., were taken under advisement;

2) Messervey's motion for continuance was denied;

3) the motion to extinguish abatement (2) would be reset for hearing at an unspecified later date;

4) the U.S. need not produce Jack Stiff, Jeff Allovio, or Margaret Embry or respond to any discovery until further order of the court; and

5) the case was abated pending the trial court's ruling on the summary judgment.

On August 24, Messervey filed a motion for leave to file a motion to lift the abatement and to file a motion for ruling on the special exceptions, objections, and the motion for summary judgment. After some procedural wrangling, the trial court set all pending motions for September 8, 2000. It also modified the July 27 abatement order. The new order, signed September 1:

1) abates the entire case for 6 months or until the criminal case becomes final, whichever is sooner; and

2) requires all parties to obtain leave of court to file any further pleadings or set any hearings.

Messervey filed yet another motion to lift the abatement. He attempted to have it set for hearing on September 18 but the court refused. Subsequently, Messervey filed a motion for leave to request findings of fact and conclusions of law, a motion for leave to file an interlocutory appeal, and a request for preparation of the clerk's record and reporter's record. The trial court refused to file findings of fact and conclusions of law, but granted the other motions.

Standard of Review

Mandamus issues only to correct a clear abuse of discretion or a violation of a duty imposed by law when there is no other adequate remedy at law. Walker v. Packer, 827 S.W.2d 833, 839-40 (Tex. 1992). The trial court abuses its discretion when it fails to properly apply the law to the undisputed facts, when it acts arbitrarily or unreasonably, or when its ruling is based on factual assertions unsupported by the record. In re Doctors' Hosp. of Laredo, 2 S.W.3d 504, 506 (Tex. App.-San Antonio 1999, orig. proceeding). In applying the abuse of discretion standard, we defer to the trial court's factual determinations, so long as they are properly supported by the record, while reviewing its legal determinations de novo. Pony Express Courier Corp. v. Morris, 921 S.W.2d 817, 820 (Tex. App.-San Antonio 1996, no writ).

Generally, there is no interlocutory appeal of the trial court's decision to abate a case because the order may be reviewed on appeal. See Abor v. Black, 695 S.W.2d 564, 566-67 (Tex.1985); Coastal Oil & Gas Corp. v. Flores, 908 S.W.2d 517, 518 & n.1 (Tex. App.-San Antonio 1995, orig. proceeding). However, an abatement order may be reviewed in special circumstances, such as when the abatement is for an indefinite period or effectively vitiates a party's ability to present a claim or defense. Gebhardt v. Gallardo, 891 S.W.2d 327, 332-33 (Tex. App.-San Antonio 1995, orig. proceeding). The grant or denial of an abatement is within the discretion of the trial court and will not be disturbed absent an abuse of discretion. Gebhardt, 891 S.W.2d at 332.

Discussion

A. Messervey's complaints

In his first two issues, Messervey challenges the validity of the abatement orders of July 27 and September 1. In his third issue, he complains the trial court abused its discretion by not ruling on the motion for summary judgment. The fourth issue is not a separate ground for mandamus but presents Messervey's argument that mandamus is allowed because there is no adequate remedy on appeal. Because it impacts our jurisdiction, we elect to address Messervey's fourth issue first.

B. Adequate Remedy by Appeal

Mandamus has been allowed:

(1) when the trial court's order of abatement is for an indefinite period of time. Gebhardt, 891 S.W.2d at 333.

(2) when a blanket stay of all discovery effectively vitiates or severely compromises a party's ability to present a claim or defense. In re R.R., 26 S.W.3d 569, 573-74 (Tex. App.-Dallas 2000, no pet. h.); Underwood v. Bridewell, 931 S.W.2d 645, 646-47 (Tex. App.-Waco 1996, orig. proceeding).

(3) when the trial court refuses to rule on a motion within a reasonable time. In re Ramirez, 994 S.W.2d 682, 683 (Tex. App.-San Antonio 1998, orig. proceeding).

All of Messervey's complaints fall into one of the above categories. Therefore, if he can show the trial court abused its discretion, he has no adequate remedy by appeal and is entitled to mandamus relief.

C. The July 27 Order

We have no jurisdiction to issue a writ of mandamus based on the July 27 order because it has been superceded by the September 1 order, rendering the earlier stay moot. See In re Taylor, 28 S.W.3d 240, 245-46 (Tex. App.-Waco 2000, orig. proceeding). However, because part of Messervey's complaint about the September 1 order is based on an erroneous interpretation of the July 27 order, we briefly address the nature of the earlier stay.

There is a distinction between a formal plea in abatement and a discretionary stay based on considerations of docket control, comity, or inconsistent rulings. See Evans v. Evans, 186 S.W.2d 277, 279 (Tex. Civ. App.-San Antonio 1945, no writ). The trial court has inherent authority to manage its own docket. Ho v. Univ. of Tex. at Arlington, 984 S.W.2d 672, 693-94 (Tex. App.-Amarillo 1998, pet. denied) (no abuse of discretion for trial court to continue trial date sua sponte pending ruling on summary judgment). The power to temporarily stay a lawsuit "is incidental to the power inherent in every court to control the disposition of the causes on its docket with economy of time and effort for itself, for counsel, and for litigants." Landis v. North Am. Co., 299 U.S. 248, 254, 57 S. Ct. 163, 166, 81 L. Ed. 153 (1936).

It is clear the July 27 abatement was a discretionary docket control order. The case had been stayed in the past and one of the motions before the trial court on July 14 (as noted in the order) was a motion to lift the stay. The trial judge, who is specially assigned to this designated complex case, is familiar with the pending criminal matter and the overall status of the lawsuits. He has the authority to stay the case temporarily while he considers the motion for summary judgment and determines whether the discovery sought by Messervey is relevant and necessary for Messervey to contest the issues raised by Northbrook. See Ho, 984 S.W.2d at 694.

D. The September 1 Order

Messervey claims the September 1 order is void or, in the alternative, is an abuse of discretion.

Messervey says the September 1 order is void because the trial court could not act while the July 27 abatement was in effect. We disagree. First, the July 27 stay is not a statutorily mandated abatement which prevents the trial court from proceeding in the case. Cf. In re Kimball Hill Homes Texas, Inc., 969 S.W.2d 522, 526-27 (Tex. App.-Houston [14th Dist.] 1998, orig. proceeding) (pursuant to statute, neither court nor parties could proceed until mandatory period of stay expired). Second, the July 27 docket control order was entered at the discretion of the trial court and, by its own terms, was not a complete abatement of the case. The language of the order clearly contemplated further action by the trial court and the trial judge retained authority to modify his own docket control order. See id. at 525 (abatement order may allow for further proceedings); Lumbermen's Mut. Cas. Co. v. Garza, 777 S.W.2d 198, 199 (Tex. App.-Corpus Christi 1989, orig. proceeding) (same). The September 1 order was not prohibited by the July 27 order.

Having determined the trial court had the authority to modify or lift the July 27 stay, we reach the validity of the September 1 abatement order. Some courts have stated a protective order is preferable to abatement as a means of limiting discovery where the government seeks to restrict civil discovery because disclosure could interfere with a criminal case based on the same facts. Underwood, 931 S.W.2d at 647; Texas Attorney General's Office v. Adams, 793 S.W.2d 771, 776-77 (Tex. App.-Fort Worth 1990, orig. proceeding). The trial court should not stay the entire lawsuit because to do so prevents the party opposing the stay from proceeding on its claims or defenses. In re R.R., 26 S.W.3d at 574; Underwood, 931 S.W.2d at 647. We hold the appropriate remedy in this case is for the trial court to fashion individual protective orders.

The September 1 order is not indefinite because it terminates when the criminal case becomes final or in 6 months, whichever is sooner, a maximum time of 6 months. However, we hold it is overbroad because it abates the entire case. The better course for the trial court at this time is to fashion individual protective orders to protect the interests of the United States and the continuing prosecution of the criminal matter without completely curtailing prosecution of the civil case. (3) We conditionally grant the petition for writ of mandamus with regard to the September 1 order to allow the trial court to vacate the order in accordance with this opinion. (4)

E. Failure to Rule on the Motion for Summary Judgment

Messervey complains the trial court has no discretion to refuse to rule on the motion for summary judgment. We agree. "When a motion is properly filed and pending before a trial court, the act of giving consideration to and ruling upon that motion is a ministerial act, and mandamus may issue to compel the trial judge to act." In re Ramirez, 994 S.W.2d 682, 683 (Tex. App.-San Antonio 1998, orig. proceeding) (citing Safety-Kleen Corp. v. Garcia, 945 S.W.2d 268, 269 (Tex. App.-San Antonio 1997, orig. proceeding)). However, the trial court has considerable discretion regarding the time it takes to rule. Zalta v. Tennant, 789 S.W.2d 432, 433 (Tex. App.-Houston [1st Dist.] 1990, orig. proceeding) (eighteen month delay not abuse of discretion).

We will not rush the trial court's decision nor will we direct the substance of the ruling. (5) We presume the trial court will act on the motion for summary judgment within a reasonable time after it vacates the September 1 order. The petition for writ of mandamus is denied with regard to the trial court's ruling on the motion for summary judgment.

Conclusion

We deny the petition for writ of mandamus based on the July 27 order for lack of jurisdiction. Because we presume the trial court will act in a reasonable time on all pending motions, we deny the petition for writ of mandamus with regard to the motion for summary judgment. We conditionally grant the petition in part to allow the trial court to vacate its September 1order in accordance with this opinion. The writ will issue if the trial court fails to vacate its order within twenty days of the date of this opinion.

PAUL W. GREEN,

JUSTICE

DO NOT PUBLISH

1. Neither party provided a copy of the court order lifting the abatement on September 28, 1998. We have only copies of the proposed orders submitted to the trial court, reflecting the parties' disagreement over the scope of the court's ruling.

2. This motion is not in the record before this court.

3. By this opinion, we do not foreclose the possibility that a complete abatement of the civil suit might be appropriate at some future date.

4. Because we conditionally grant the petition with regard to the September 1 order, we need not reach the issue of whether it was error for the trial court to refuse to enter findings of fact and conclusions of law regarding the September 1 order.

5. We note, however, the parties' concern about the effect of a summary judgment ruling on the federal conviction is irrelevant at this time. If Judge Specia grants the summary judgment, the entire dispute goes away. If he denies the summary judgment, he has done no more than rule that based upon the summary judgment evidence in the civil court record, there is a question of fact to be determined by a jury. This is not inconsistent with the federal jury verdict, which is not yet even final, based on evidence in the criminal trial, which may or may not be the same as what is finally presented in the civil trial.