In Re Immobiliere Jeuness Establissement

Petition for Writ of Mandamus Conditionally Granted, in Part, and Denied,
in Part, and Opinion filed February 6, 2014.

In The

Fourteenth Court of Appeals

NO. 14-13-00771-CV

IN RE IMMOBILIERE JEUNESS ESTABLISSEMENT, Relator

ORIGINAL PROCEEDING
WRIT OF MANDAMUS
215th District Court
Harris County, Texas
Trial Court Cause No. 2012-45412

OPINION

On September 4, 2013, relator Immobiliere Jeuness Establissement filed a
petition for writ of mandamus in this Court. See Tex. Gov’t Code Ann. §22.221;
see also Tex. R. App. P. 52. In the petition, relator asks this Court to compel the
Honorable Elaine Palmer, presiding judge of the 215th District Court of Harris
County, to set aside her March 8, 2013 and April 5, 2013 abatement orders.1 We
conditionally grant the petition, in part, and deny it, in part.

BACKGROUND

Immobiliere Jeuness Establissement (“IJE”) is an entity organized under the
laws of Lichtenstein and a limited partner in 29 Kuykendahl Road, Ltd., which, in
turn, is a limited partner in 9.2 Louetta Road, Ltd. (collectively, the
“Partnerships”). Radnor Joint Venture, Inc. (“Radnor”) is the general partner of
the Partnerships. Michael H. Beucler is the owner of Radnor.

29 Kuykendahl Road owned a 12.22 acre tract of land, and 9.2 Louetta Road
owned a 6.7 acre tract of land, which were developed into a multi-family
affordable housing project known as Villages at Louetta Apartments (the
“Project”).

IJE alleges that, unbeknownst to the limited partners of the Partnerships,
Beucler closed on two separate loans in the amounts of $1,000,000 and $400,000
between December 2001 and March 2002; these loans were secured by the two
Partnership tracts but used for non-partnership purposes. The loans were originally
financed by InterContinental National Bank (“Intercon”) (later Amegy). Steven J.
Pritchard was the president of Intercon. Upon maturity of the loans, they were
refinanced by Texas Capital Bank, and later paid off with financing by Key
National Bank.

1
The real parties in interest are Ricardo G. Cedillo, Jason C. Zehner, Russell Davis,
Davis, Cedillo & Mendoza, Inc. (collectively “DCM”), Amegy Bank National Association, and
Steven J. Pritchard. Amegy and Pritchard filed a joinder in the response filed by DCM.
Therefore, we refer to all arguments by real parties in interest as being those of DCM.
2
 According to IJE, the loan proceeds were used to enhance the balance sheet
of an unrelated company, FAS Construction Management, Inc., which was owned
by Beucler. FAS, which provided construction risk management for banks,
developers, and contractors, was in dire financial straits and in need of an infusion
of capital. Beucler put up the tracts as collateral for the loans, which went directly
from Intercon to FAS’s operating account.

Part of the proceeds from the Project financing from Key Bank were used to
pay off the loans, but none of that money was repaid by FAS or Beucler. Instead,
it came out of Partnership funds, saddling the Partnerships with the $1.4 million
costs. IJE alleges that Beucler and the law firm of Davis, Cedillo & Mendoza
(“DCM”) fabricated the following partnership purpose: FAS received $1.4 million
as a “fee” for developing a viable/finance-able model for an affordable housing
development when FAS had no role in it. IJE further alleges that DCM was
simultaneously representing the Partnerships and Beucler, and Beucler and DCM
refused IJE’s requests to disclose material information to the limited partners of the
Partnerships about the $1.4 million and the Project.

On August 8, 2012, IJE brought the underlying derivative action against real
parties after, according to IJE, it became apparent that the general partner, Radnor,
would not bring this action and any effort to cause Radnor to bring the action
would not likely succeed. See Tex. Bus. Orgs. Code Ann. § 153.401 (West 2012).2

2
Section 153.401, entitled “Right to Bring Action,” provides:

A limited partner may bring an action in a court on behalf of the limited
partnership to recover a judgment in the limited partnership’s favor if:

3
IJE brought claims against DCM for negligence, negligent misrepresentation,
breach of fiduciary duty, DTPA violations, fraud, tortious interference with a
contract, aiding and abetting, conspiracy, and vicarious liability for the acts of
Beucler and Radnor. IJE brought claims against Amegy and Pritchard for tortious
interference with a contract, aiding and abetting, and conspiracy.

On February 26, 2013, DCM filed a motion to abate. Arguing that IJE had
alleged the misconduct took place in Texas and IJE was not registered to do
business in Texas, DCM contended that IJE could not maintain the action, whether
brought derivatively or not, until it had properly registered to do business in Texas,
including paying all applicable civil penalties and late filing fees required by law.
See Tex. Bus. Orgs. Code Ann. § 9.051(b) (West 2012). DCM further argued this
lawsuit could not be maintained on behalf of the Partnerships because both limited
partnerships lack capacity to maintain suit because they were involuntarily
terminated as of July 15, 2011. Therefore, until the Partnerships regain their legal
capacity, the suit should remain abated. See Tex. Bus. Orgs. Code Ann.
§ 153.309(a)(1) (West 2012). Amegy and Pritchard filed joinders in DCM’s
motion to abate.

On March 8, 2013, the trial court held a hearing on the motion to abate. At
the conclusion of the hearing, the trial court stated it was granting the motion

(1) all general partners with authority to bring the action have refused to bring the
action; or

(2) an effort to cause those general partners to bring the action is not likely to
succeed.

Tex. Bus. Orgs. Code Ann. § 153.401.
4
“based on Texas Business Organizations Code section 9.051.” That same day, the
trial court signed the following abatement order pursuant to sections 9.051 and
153.309:

Upon consideration of Defendants’ Motion to Abate, the Court
finds that this motion should be GRANTED. Accordingly it is hereby
ORDERED that:

The above-captioned lawsuit is abated and all proceedings are
stayed until (1) [IJE] registers to transact business in Texas by
complying with the applicable provisions of the Texas Business
Organizations Code, including payment of all applicable fees; and (2)
29 Kuykendahl Road, Ltd and 9.2 Louetta Road, Ltd. reinstate their
certificate of formation or registration and revive their right to transact
business in Texas by complying with the applicable provisions of the
Texas Business Organizations Code, including payment of all
applicable fees.

On March 14, 2013, IJE filed a motion to clarify the trial court’s March 8,
2013 ruling, arguing that the written order did not reflect the trial court’s
determination that it would grant the verified motion to abate based solely on
section 9.051, not on section 153.309, which applies to the Partnerships’ capacity
to maintain a suit as limited partnerships. On April 5, 2013, the trial court signed
the following order clarifying that it was granting the motion to abate based on
both sections 9.051 and 153.309:

Upon hearing Plaintiff’s Motion to Clarify and consideration of
the record, the Court clarifies its Order Granting Defendants’ Verified
Motion to Abate as follows:

Defendants’ Verified Motion to Abate is GRANTED as to (1)
[IJE] based on Texas Business Organizations Code Section 9.051 and
(2) 29 Kuykendahl Road, Ltd. and 9.2 Louetta Road, Ltd. based on
Texas Business Organizations Code Section 153.309.
5
 Accordingly, it is hereby ORDERED that the above-captioned
lawsuit is abated and all proceedings are stayed until [IJE], 29
Kuykendahl Road, Ltd., and 9.2 Louetta Road, Ltd. comply with the
applicable provisions of the Texas Business Organizations Code,
including payment of all applicable fees.
On June 5, 2013, IJE moved to reconsider and/or lift the abatement. In the
motion, IJE explained that prior to bringing this derivative suit, IJE had sued 9.2
Louetta Road, 29 Kuykendahl Road, Radnor, Village at Louetta Apartments, Ltd.,
Louetta Villages, L.L.C., Beucler, and FAS in the 129th District Court of Harris
County.3 On May 30, 2013, the Hon. Michael Gomez signed an order authorizing
IJE to wind up the affairs of 9.2 Louetta Road and 29 Kuykendahl Road under
Sections 11.054 and 11.055 of the Texas Business Organizations Code; the order
specifically permits “filing and/or prosecuting any existing claims the Partnerships
may have against third parties.”4 See Tex. Bus. Orgs. Code Ann. §§ 11.054,
11.055 (West 2012).

3
See Cause No. 2009-12728, Immobiliere Jeuness Establissement v. 9.2 Louetta Road,
Ltd., 29 Kuykendahl Road, Ltd., Radnor Joint Venture, Inc., Village at Louetta Apartments, Ltd.,
Louetta Villages, LLC, Michael H. Beucler, and FAS Management Construction, Inc., 129th
District Court, Harris County, Texas.
4
Judge Gomez’s order stated:

The Court heard Plaintiff, Immobiliere Jeuness Establissement[’s]
Application to Wind Up the Affairs between the [N]ominal [D]efendants 9.2
Louetta Road, Ltd., 29 Kuykendahl Road, Ltd., (collectively the “Partnerships”)
under Sections 11.054 and 11.055 of the Texas Business Organizations Act and
after reviewing all submissions and hearing arguments of counsel the Application
is GRANTED as follows:

IT IS ORDERED that Plaintiff [IJE] acting derivatively on behalf of the
Partnerships is hereby authorized under Section 11.054 and Section 11.055 of the
Tex. Bus. Org. Code (“Act”) and subject to the supervision of the Court, to
continue the Partnerships[’] existence for the purposes enumerated under the Act
6
 IJE argued that pursuant to Judge Gomez’s order, it had the authority on
behalf of the Partnerships to proceed with prosecuting any existing claims the
Partnerships may have against third parties, including all defendants in this case.
Thus, IJE posited that the impediment to go forward was removed by Judge
Gomez’s order. On July 12, 2013, the trial court signed the order denying IJE’s
motion to reconsider and/or lift abatement.

On July 30, 2013, IJE filed a second motion to reconsider and/or lift
abatement “in one last effort to have this case un-abated prior to filing a Petition
for Writ of Mandamus.” On August 12, 2013, the trial court denied IJE’s second
motion to reconsider and/or lift abatement. This mandamus followed.

which includes but is not limited to the following: (1) winding up and settling the
affairs of the Partnerships, (2) filing and/or prosecuting any existing claims the
Partnerships may have against third parties, and (3) entering into any compromise
and settlement, subject to Court approval, on behalf of the Partnerships.

IT IS FURTHER ORDERED that Defendant, Radnor Joint Venture, Inc.
(“Radnor”) as general partner of the Partnerships shall manage (in conformity
with the responsibilities and obligations of Radnor as specified in the governing
documents of the Partnerships and subject to the supervision of the Court) the
continuing affairs, if any, of the Partnerships.

IT IS FURTHER ORDERED that nothing in this order shall be construed
as removing Radnor as the general partner of the Partnerships.

IT IS FURTHER ORDERED that nothing in this order shall be construed
as granting Plaintiff [IJE] any authority to manage the affairs of the Partnerships
other than is expressly set out in the order.

IT IS FURTHMORE ORDERED that this Court shall retain jurisdiction to
make any other order, direction, or inquiry that the circumstances require in the
process of winding up the affairs of the Partnerships.

7
 STANDARD OF REVIEW

Mandamus is appropriate when the relator demonstrates that (1) the trial
court clearly abused its discretion; and (2) the relator has no adequate remedy by
appeal. In re Reece, 341 S.W.3d 360, 364 (Tex. 2011) (orig. proceeding). A trial
court clearly abuses its discretion if it reaches a decision so arbitrary and
unreasonable as to amount to a clear and prejudicial error of law, or if it clearly
fails to analyze the law correctly or apply the law correctly to the facts. In re
Cerberus Capital Mgmt., L.P., 164 S.W.3d 379, 382 (Tex. 2005) (orig. proceeding)
(per curiam).

The adequacy of an appellate remedy must be determined by balancing the
benefits of mandamus review against the detriments. In re Team Rocket, L.P., 256
S.W.3d 257, 262 (Tex. 2008) (orig. proceeding). Because this balance depends
heavily on circumstances, it must be guided by analysis of principles rather than
simple rules that treat cases as categories. In re McAllen Med. Ctr., Inc., 275
S.W.3d 458, 464 (Tex. 2008) (orig. proceeding). In evaluating benefits and
detriments, we consider whether mandamus will preserve important substantive
and procedural rights from impairment or loss. In re Prudential Ins. Co. of Am.,
148 S.W.3d 124, 136 (Tex. 2004) (orig. proceeding). We also consider whether
mandamus will “allow the appellate courts to give needed and helpful direction to
the law that would otherwise prove elusive in appeals from final judgments.” Id.
Finally, we consider whether mandamus will spare the litigants and the public “the
time and money utterly wasted enduring eventual reversal of improperly conducted
proceedings.” Id.

8
 Abatement of an action not only precludes the trial court from going forward
on a case, it prohibits the parties from proceeding in any manner until the case has
been reinstated. In re Kimball Hill Homes Tex., Inc., 969 S.W.2d 522, 527 (Tex.
App.—Houston [14th Dist.] 1998, orig. proceeding). A trial court abuses its
discretion when it arbitrarily abates a case for an indefinite period of time. In re
Gore, 251 S.W.3d 696, 699 (Tex. App.—San Antonio 2007, orig. proceeding). An
adequate remedy by appeal does not exist when the plaintiff is “‘effectively denied
any other method of challenging the court’s action for an indefinite period of time
during which the cause of action remains in a suspended state.’” In re Discovery
Operating, Inc., 216 S.W.3d 898, 905 (Tex. App.—Eastland 2007, orig.
proceeding [mand. denied]) (quoting Trapnell v. Hunter, 785 S.W.2d 426, 429
(Tex. App.—Corpus Christi 1990, orig. proceeding)).

ANALYSIS

IJE claims the trial court abused its discretion by abating the case until IJE
and the Partnerships complied with sections 153.309(a)(1) and 9.051(b) of the
Texas Business Organizations Code, and it has no adequate remedy by appeal. We
will address section 153.309(a)(1) first.

Section 153.309(a)(1)

IJE asserts that section 153.309 is inapplicable to derivative actions. DCM,
on the other hand, argues section 153.309 plainly provides that a consequence of
the Partnerships’ forfeiting their right to transact business in Texas is that neither
may maintain an action, suit or proceeding in a Texas court. Section
153.309(a)(1), entitled “Effect of Forfeiture of Right to Transact Business,” states:

9
 (a) Unless the right of the limited partnership to transact business is
revived in accordance with Section 153.310:

(1) the limited partnership may not maintain an action, suit, or
proceeding in a court of this state[.]

Tex. Bus. Orgs. Code Ann. § 153.309(a)(1).

When construing a statute, the primary objective is to give effect to the
Legislature’s intent. Tex. Lottery Comm’n v. First State Bank of DeQueen, 325
S.W.3d 628, 635 (Tex. 2010). “We presume the Legislature selected language in a
statute with care and that every word or phrase was used with a purpose in mind.”
Id. We construe statutes by first looking to the statutory language for the
Legislature’s intent, and only if we cannot discern legislative intent in the language
of the statute itself do we resort to canons of construction. Id. at 639.

We disagree with DCM’s construction of section 153.309(a)(1). The term
“limited partnership” refers to the entity that is maintaining the action, suit, or
proceeding. Here, the underlying lawsuit was not maintained by the Partnerships.
Instead, it was brought as a derivative action by IJE pursuant to section 153.401.
See Tex. Bus. Orgs. Code Ann. § 153.401 (providing a limited partner may bring
an action in a court on behalf of the limited partnership if the general partner
refuses to do so, or an effort to cause the general partner to do so would likely not
succeed). Because the Partnerships are not maintaining the suit, their forfeiture of
the right to transact business in Texas does not require abatement of the suit under
section 153.309. A contrary interpretation would lead to absurd results. The
general partner, Radnor, has the authority to revive the Partnerships’ right to

10
transact business in Texas, not the limited partners.5 Under DCM’s interpretation
of section 153.309(a)(1), a limited partnership may never be revived for the
purpose of maintaining an action, suit, or proceeding if the general partner chooses
not to take the necessary steps to alter the limited partnership’s status. This
interpretation improperly gives the general partner the right to veto a derivative
action challenging its conduct.

Our interpretation is consistent with long-standing Texas law. In Pratt-
Hewit Oil Corporation v. Hewit, the Texas Supreme Court addressed when a
stockholder could prosecute a suit on behalf of a corporation that did not have the
capacity to maintain the suit. 52 S.W.2d 64 (Tex. 1932). In that case, Pratt-Hewit,
a Delaware corporation, proceeded to transact business in this state by conducting
drilling operations without filing articles of incorporation or obtaining a permit to
do business in Texas. Id. at 64. Pratt-Hewit subsequently assigned a one-half
interest to Houston Oil Corporation. Id. Hewit, suing for himself and other
stockholders for the benefit of Pratt-Hewit, brought suit against Pratt-Hewit, its
individual directors, and Houston Oil, seeking to cancel the contract between Pratt-
Hewit and Houston Oil because it defrauded the stockholders. Id. at 64−65. Pratt-
Hewit and the other defendants argued that Pratt-Hewit was barred by statute from
bringing and maintaining the suit because it had not taken out a permit to do
business in Texas. Id. at 65. The trial court agreed with Pratt-Hewit and dismissed
the suit. Id.
5
See Tex. Bus. Orgs. Code Ann. § 153.152 (West 2012). The 29 Kuykendahl Road
partnership agreement provides that “no Limited Partner, in his capacity as a Limited Partner,
shall be . . . allowed to take part in the management or control of the partnership business, or go
sign for or bind the Partnership, it being understood and agreed that such power shall vest solely
and exclusively in the General Partner[.]”
11
 The issue before the Texas Supreme Court was whether the stockholders
could prosecute the suit for the benefit of the corporation, which could not
maintain the suit on its own behalf. Id. The court observed that wrongs against
stockholders affecting their interest in the corporate properties arising from a
breach of trust by the corporation’s directors can be categorized as fraudulent acts,
ultra vires acts, and negligent acts. Id.

The court rejected Pratt-Hewit’s argument that because it was barred from
maintaining the suit, its stockholders could not maintain the action for its benefit.
Id. at 66. The penalty for failing to comply with the statutory requirement of filing
articles of incorporation “was not designed to aid the managing officers of any
such corporation to dispose of the corporate property in fraud of the rights of
stockholders.” Id. Instead, its purpose is to compel corporations to obey Texas
law by obtaining a permit before transacting business in this state. Id.
Stockholders will not be prohibited from “redressing wrongs which injuriously
affect their right and interest in the corporate assets.” Id. The court explained:

[T]he cause of action based upon fraudulent conduct of the directors is
in the corporation. If it is unable or will not assert such action, the
only ones left to prosecute it are the stockholders, the beneficial
owners of the corporate assets. If they are not permitted to maintain
the action which the corporation refuses or is unable to assert, then the
directors could deal as they please with the corporate property with
the perfect assurance that the courts of this state would be closed to
the stockholders in any effort to set aside a fraudulent disposition of
the corporate property. We decline to sanction such a legal
proposition leading to any such result.

Id. at 67.

12
 The court expressly held that a stockholder could maintain a suit for the
benefit of an unregistered corporation when the cause of action alleged fraudulent
acts, ultra vires acts, or negligent acts. Id. If the cause of action is an ordinary one
that accrues to the corporation in the due course of its business, however, the
stockholder is barred from bring suit just as the corporation is due to its failure to
comply with filing requirements because the corporation and the stockholders
would be in complete harmony. Id. at 66, 67.

In Robinette v. Merrill Lynch, Pierce, Fenner & Smith, Inc., the U.S. District
Court for the Northern District of Texas conducted a thorough analysis of Texas
law in addressing whether a stockholder can maintain claims belonging to a
corporation that had forfeited its corporate charter for failure to pay franchise
taxes. CA No. 3:96-CV-2923-D, CA No. 3:97-CV-0353-D, 2004 U.S. Dist.
LEXIS 24537 (N.D. Tex. Nov. 23, 2004) (“Robinette II”). After summarizing
several Texas cases, the court concluded that those cases established five
principles. Id. at *32.6 First, the forfeiture of a corporation’s charter does not
prohibit stockholders from obtaining relief from fraudulent and oppressive acts of
corporate directors or prevent stockholders from redressing wrongs that injuriously
affect their right and interest in corporate assets. Id. Second, suit can only be
maintained by a stockholder for the benefit of the corporation when it is alleged
that the directors are guilty of fraud, ultra vires acts, or negligence resulting in
injury to the stockholder. Id. at *32−33. Third, if a cause of action is an ordinary

6
In addition to considering Pratt-Hewit, the court also discussed Humble Oil & Refining
Co. v. Blankenburg, 235 S.W.2d 891 (Tex. 1951), Federal Crude Oil Co. v. Yount-Lee Oil Co.,
52 S.W.2d 56 (Tex. 1932), and Favorite Oil Co. of Beaumont & Cleburne v. Jef Chaison
Townsite Co., 162 S.W. 423 (Tex. Civ. App.—Galveston 1913, no writ).
13
one that accrues to the corporation in the due course of its business, and the
incapacitated corporation cannot bring the action, suit cannot be maintained for its
benefit by its agent, assignee, or stockholder. Id. at *33. Fourth, when a
corporation has been denied the right to use the courts, property that the
corporation holds in trust for its stockholders is not subject to appropriation by
third parties, and suit must be brought not for the benefit of the corporation, but by
individual stockholders suing in their own right. Id. Fifth, forfeiture of a corporate
charter does not destroy or forfeit the property of the corporation, and the
company’s stockholders, who are the beneficial owners of the property, are
authorized to prosecute or defend such actions in the courts as necessary to protect
their rights. Id.7

Pratt-Hewit and the first and second principles of Robinette II confirm that
the forfeiture of the Partnerships’ right to do business in Texas does not preclude
IJE from maintaining a derivative suit in the name of the Partnerships. Therefore,
we conclude the trial court clearly abused its discretion by holding that section
153.309(a)(1) applied to this suit and abating the underlying case until the
Partnerships have revived their right to transact business in Texas.

7
The Robinette court had originally held several months earlier that, because the
corporation had forfeited its corporate charter, it was “barred from enforcing a right against
Merrill Lynch since it [was] precluded from bringing suit.” Robinette v. Merrill Lynch, Pierce,
Fenner & Smith, Inc., CA No. 3:96-CV-2923-D, CA No. 3:97-CV-0353-D, 2004 WL 789870, at
*2 (N.D. Tex. Apr. 12, 2004) (“Robinette I”). DCM cited to the Robinette I Westlaw citation in
its response to IJE’s petition. However, Robinette II cannot be located on Westlaw. After IJE
discussed Robinette II in its reply, DCM asserted in a sur-reply that the court in Robinette II did
not revisit its prior holding that a shareholder could not bring a derivative action on behalf of a
corporation whose right to do business in Texas has been forfeited. For the reasons discussed
above, we disagree with DCM’s interpretation of Robinette II.
14
 Moreover, under these circumstances, we hold that IJE does not have an
adequate remedy by appeal. The party authorized to revive the Partnerships’
ability to transact business in Texas is Radnor, the general partner of the
Partnerships, not IJE. Thus, IJE has shown that it has been “‘effectively denied
any other method of challenging the court’s action for an indefinite period of time
during which the cause of action remains in a suspended state.’” See In re
Discovery Operating, Inc., 216 S.W.3d at 905 (quoting Trapnell,785 S.W.2d at
429).8 We next address the trial courts’ order with respect to IJE’s compliance
with section 9.051(b).

Section 9.051(b)

IJE also asserts that the trial court abused its discretion by abating the
underlying case pursuant to section 9.051(b) until IJE registered to do business in
Texas. Section 9.051(b) provides:

(b) A foreign filing entity or the entity’s legal representative
may not maintain an action, suit, or proceeding in a court of this state,
brought either directly by the entity or in the form of a derivative
action in the entity’s name, on a cause of action that arises out of the
transaction of business in this state unless the foreign filing entity is
registered in accordance with this chapter. . . .
Tex. Bus. Orgs. Code Ann. § 9.051(b).

As discussed above, IJE has no control over the reinstatement of the
Partnerships’ right to transact business in Texas in connection with section
153.309(a)(1) as only the general partner has that authority; therefore, IJE has no
8
See also Tex. Mut. Ins. Co. v. Sonic Sys. Int’l, Inc., 214 S.W.3d 469, 482 (Tex. App.—
Houston [14th Dist.] 2006, orig. proceeding); Gebhardt v. Gallardo, 891 S.W.2d 327, 332–33
(Tex. App.—San Antonio 1995, orig. proceeding).
15
adequate remedy by appeal. IJE does have control over whether it registers to do
business in Texas, however, and IJE has shown only that it has chosen not to
register. Accordingly, IJE has not demonstrated that it has been denied any
method of challenging an indefinite abatement. Therefore, we conclude that IJE
has not shown that it does not have an adequate remedy by appeal, and we need not
address whether the trial court abused its discretion by ordering IJE to register to
transact business.

CONCLUSION

We conclude that the trial court clearly abused its discretion by holding that
section 153.309(a)(1) applies here and abating the underlying case until 29
Kuykendahl Road and 9.2 Louetta Road have revived their right to transact
business in Texas. We also conclude that IJE does not have an adequate remedy
by appeal.9 Accordingly, we conditionally grant the petition for writ of mandamus,
in part, and direct the trial court to vacate those portions of its March 8, 2013 and
9
DCM also argues mandamus is barred by laches because IJE waited six months to seek
mandamus relief. Although mandamus is not an equitable remedy, its issuance is controlled
largely by equitable principles. In re Int’l Profit Assocs., Inc., 274 S.W.3d 672, 676 (Tex. 2009)
(orig. proceeding) (per curiam). A delay in the filing of a petition for writ of mandamus may
waive the right to mandamus unless the relator can justify the delay. Id.
Here, the trial court signed the original abatement order on March 8, 2013, and the
clarified abatement order on April 5, 2103. IJE filed its petition in this court on September 4,
2013. In between that time, IJE filed two motions to reconsider on June 5, 2103, and July 30,
2013, respectively. The June 5, 2013 motion included arguments based on Judge Gomez’s May
30, 2013 order. The July 30, 2013 did not raise anything new, but IJE filed it “in one last effort
to have this case un-abated prior to filing a Petition for Writ of Mandamus.” See In re Perritt,
992 S.W.2d 444, 446 (Tex. 1999) (orig. proceeding) (per curiam) (“A party’s right to mandamus
relief generally requires a predicate request for some action and a refusal of that request.”). The
trial court denied the second motion on August 12, 2013. Thus, the record reflects the reasons
for the six-month lapse in time between the trial court’s March 8, 2013 abatement order and the
filing of the mandamus. Under these circumstances, laches is not a basis to deny the petition.
16
April 5, 2013 orders abating the underlying case until 29 Kuykendahl Road and 9.2
Louetta Road have reinstated their certificates of formation or registration and
revived their right to transact business in Texas by complying with the applicable
provisions of the Texas Business Organizations Code. We deny the remainder of
the petition regarding IJE’s compliance with section 9.051(b) because IJE has an
adequate remedy by appeal. The writ will only issue if the trial court does not act
in conformity with this opinion.

PER CURIAM

Panel consists of Justices Jamison, McCally, and Busby.

17