Robert D. Shipley v. Unifund CCR Partners--Appeal from 87th District Court of Freestone County
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IN THE
TENTH COURT OF APPEALS
No. 10-09-00314-CV
ROBERT D. SHIPLEY,
Appellant
v.
UNIFUND CCR PARTNERS,
Appellee
From the 87th District Court
Freestone County, Texas
Trial Court No. 08-294-A
OPINION ON REHEARING
Robert Shipley appeals from the entry of a judgment against him for a debt on a
credit card account. Shipley complains that the trial court erred by not dismissing the
suit against him because Unifund CCR Partners lacked standing to bring the suit
because the court lacked subject matter jurisdiction in that Unifund CCR Partners did
not own the debt and therefore did not have standing to bring the action. Shipley also
complains that the evidence was legally insufficient for the trial court to have granted a
judgment against him and in favor of Unifund CCR Partners because there was no
evidence that Shipley’s debt had been assigned to Unifund CCR Partners.
On original submission, this Court affirmed the judgment. See Shipley v. Unifund
CCR Partners, No. 10-09-00314-CV, 2010 Tex. App. LEXIS 4544 (Tex. App.—Waco June
16, 2010). Upon Shipley’s timely motion for rehearing, we requested a response from
Unifund CCR Partners, although Unifund has not done so. As authorized by Rule of
Appellate Procedure 49.3, we issue this modified opinion after requesting the response.
TEX. R. APP. P. 49.3. On reconsideration of the issues presented, we will reverse the
judgment, dismiss this cause for lack of jurisdiction, and withdraw our prior opinion
and judgment. Id.
Standing
Shipley contends that Unifund CCR Partners did not own any interest in the
account in question, and therefore, they lacked standing to bring the suit against him.
Citibank South Dakota, N.A. sold the account to Unifund Portfolio A., LLC. Unifund
Portfolio A, LLC then assigned its rights to collect the account to Unifund CCR
Partners, but retained the title and ownership of the account. In his brief to this Court,
Shipley does not complain about the sale of the account from Citibank to Unifund
Portfolio A, but of the assignment from Unifund Portfolio A to Unifund CCR Partners.
Standing,
a
necessary
component
of
subject-matter
jurisdiction,
is
a
constitutional prerequisite to maintaining a suit under Texas law. Tex. Ass'n of Bus. v.
Tex. Air Control Bd., 852 S.W.2d 440, 444-45 (Tex. 1993). Whether a party has standing to
pursue a claim is a question of law that we review de novo.
Mayhew v. Town of
Sunnyvale, 964 S.W.2d 922, 928 (Tex. 1998).
Shipley v. Unifund CCR Partners
Page 2
Standing refers to a party’s justiciable interest in a controversy. See Nootsie, Ltd.
v. Williamson County Appraisal Dist., 925 S.W.2d 659, 661-62 (Tex. 1996); Town of Fairview
v. Lawler, 252 S.W.3d 853, 855 (Tex. App.—Dallas 2008, no pet.). Only the party whose
primary legal right has been breached may seek redress for an injury. Nauslar v. Coors
Brewing Co., 170 S.W.3d 242, 249 (Tex. App.—Dallas 2005, no pet.). Without a breach of
a legal right belonging to that party, that party has no standing to litigate. Cadle Co. v.
Lobingier, 50 S.W.3d 662, 669-70 (Tex. App.—Fort Worth 2001, pet. denied).
In
reviewing standing on appeal, we construe the petition in favor of the plaintiff, and if
necessary, review the entire record to determine if any evidence supports standing. See
Tex. Air Control, 852 S.W.2d at 446.
An “assignment” is simply a transfer of some right or interest. See Pagosa Oil &
Gas, L.L.C. v. Marrs & Smith P'ship, No. 08-07-00090-CV, 2010 Tex. App. LEXIS 938 at *10
(Tex. App.—El Paso Feb. 10, 2010, no pet. h.) (citing University of Texas Med. Branch at
Galveston v. Allan, 777 S.W.2d 450, 452 (Tex. App.—Houston [14th Dist.] 1989, no writ).
When an assignee holds a contractually valid assignment, that assignee steps into the
shoes of the assignor and is considered under the law to have suffered the same injury
as the assignors and have the same ability to pursue the claims. Southwestern Bell Tel.
Co. v. Mktg. on Hold Inc., 53 Tex. Sup. Ct. J. 322, 2010 Tex. LEXIS 159 (Tex. 2010) (citing
Holy Cross Church of God in Christ v. Wolf, 44 S.W.3d 562, 572 (Tex. 2001).
Pleadings and Evidence in the Record
“It has long been the rule that a plaintiff’s good faith allegations are used to
determine the trial court’s jurisdiction.” Eaves v. Unifund CCR Partners, 301 S.W.3d 402,
Shipley v. Unifund CCR Partners
Page 3
404 (Tex. App.—El Paso 2009, no pet.) (citing Brannon v. Pac. Employers Ins. Co., 148 Tex.
289, 224 S.W.2d 466, 469 (Tex. 1949)). A court may presume the truth of allegations
made in a party’s pleadings when determining standing. Id. (citing Tex. Ass’n of Bus.,
852 S.W.2d at 446; Brown v. Todd, 53 S.W.3d 297, 305 n.3 (Tex. 2001) (“Because standing
is a component of subject matter jurisdiction, we consider [it] as we would a plea to the
jurisdiction, construing the pleadings in favor of the plaintiff.”)).
“A court is not
required to look solely to the pleadings but may consider evidence and must do so
when necessary to resolve the jurisdictional issues raised.” State Dep’t of Crim. Justice v.
Miller, 51 S.W.3d 583, 587 (Tex. 2001). However, the petition’s sole reference to Unifund
CCR Partners’s ownership or standing to litigate is the statement that “Plaintiff is
authorized to file this petition.” We do not find that this constitutes any evidence of
standing.
The case was solely decided based on business records filed by Unifund CCR
Partners. The evidence presented in the business records affidavit is likewise unclear as
to what interest beyond the right of collection that Unifund CCR Partners owns.
Additionally, the trial court sustained Shipley’s hearsay objections to the affidavit and
struck the content of the affidavit outside of the questions required to authenticate the
business record as such. In fact, the assignment from Unifund Portfolio A, LLC to
Unifund CCR Partners indicates that Unifund CCR Partners owns nothing.
The
pertinent language of the assignment states:
Assignor, for value received and in connection with the Agreement,
transfers and assigns to Assignee all of Assignor’s rights in the
Receivables, for collection purposes only, including conducting litigation in
Shipley v. Unifund CCR Partners
Page 4
Assignee’s name, for those Receivables which Assignor owns or may
acquire from time to time. Assignor shall retain title and ownership of such
Receivables. The assignment is without recourse to Assignor and without
warranty of any kind (including, without limitation, warranties pertaining
to title, validity, collectibility (sic), accuracy or sufficiency of information,
and applicability of any statute of limitations), except as stated in the
Agreement or herein. (emphasis added)
Because standing denotes a party’s justiciable interest in a controversy, it is only
the party whose primary legal right has been breached that may seek redress for that
injury. Eaves, 301 S.W.3d at 404. Without a breach of a legal right belonging to that
party, that party has no standing to litigate. Id. (citing Cadle Co. v. Lobingier, 50 S.W.3d
662, 669-70 (Tex. App.—Fort Worth 2001, pet. denied)). Unifund CCR Partners’s right is
solely limited to taking whatever steps are necessary to collect a debt owned entirely by
someone else, while holding no title, interest, or rights in anything else. We do not find
that this is sufficient to establish that Unifund CCR Partners has standing to pursue this
claim in its own name.
Cases that have found standing to exist all indicate that a finding of ownership of
some type was made. Even the cases cited to by Unifund CCR Partners demonstrate
that some ownership interest was transferred by the assignor to the assignee. See Sprint
Communications Co., L.P. v. APCC Services, Inc., ___ U.S. ___, 128 S. Ct. 2531, 2541-43, 171
L. Ed. 2d 424 (2008) (assignee with legal title to debt of a legal claim for money owed
has standing to pursue the claim even if proceeds are to be entirely remitted to
assignor); see also Eaves, 301 S.W.3d 403-04 (pleadings and live testimony sufficiently
demonstrated that Unifund owned the account in question to establish standing);
Cartwright v. MBank Corpus Christi, N.A., 865 S.W.2d 546, 549-50 (Tex. App.—Corpus
Shipley v. Unifund CCR Partners
Page 5
Christi 1993, writ denied) (note transferred to MBank making MBank the holder of the
note); Schultz v. Aetna Business Credit, Inc., 540 S.W.2d 530, 531 (Tex. Civ. App.—San
Antonio 1976, no writ) (assignor transferred “all of its rights, title and interests” in the
relevant instrument, any accompanying promissory note or notes, and all rights and
remedies under said instrument or notes); Kelley v. Bluff Creek Oil Co., 298 S.W.2d 263,
267 (Tex. Civ. App.—Fort Worth 1956) (assignment transferred all “right, title and
interest” in a claim, “with full power and authority to collect and receipt therefore”),
aff’d in part, and rev’d in part on other grounds, 158 Tex. 180, 309 S.W.2d 208 (1958).
We find that without evidence of any ownership interest or title in the account
that Unifund CCR Partners does not have standing to bring this suit and that the trial
court did not have subject matter jurisdiction over the action. We sustain issue one.
Conclusion
We conclude that Unifund CCR Partners did not have standing to file suit
against Shipley. Therefore, because the trial court lacked subject matter jurisdiction, we
reverse the judgment of the trial court and render judgment dismissing the case.
TOM GRAY
Chief Justice
Before Chief Justice Gray,
Justice Reyna, and
Justice Davis
Reversed and rendered by dismissal
Opinion on Rehearing delivered and filed October 13, 2010
[CV06]
Shipley v. Unifund CCR Partners
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