ACCEPTED
03-14-00643-CV
3641064
THIRD COURT OF APPEALS
AUSTIN, TEXAS
1/2/2015 7:17:03 PM
JEFFREY D. KYLE
CLERK
No. 03-----
-14-----
-00643-----
-CV
In the Court of Appeals FILED IN
3rd COURT OF APPEALS
For the Third District of Texas AUSTIN, TEXAS
Austin, Texas 1/2/2015 7:17:03 PM
JEFFREY D. KYLE
Clerk
Monte Montgomery,
Appellant,
v.
Monty Hitchcock,
Appellee
On appeal from Cause No. D-1-GN-14-000489
In the 250th Judicial District Court of Travis County, Texas
Honorable Jon N. Wisser, Judge Presiding
Appellant’s Opening Brief
Steven R. Samples
State Bar No. 24086348
Samples Law Group
2605 Airport Freeway, Suite 100
Fort Worth, Texas 76111
817-500-0565 Direct
855-605-1505 Fax
srs@stevesamples.com
Attorney for Appellant
ORAL ARGUMENT REQUESTED
No. 03-----
-14-----
-00643-----
-CV
In the Court of Appeals
For the Third District of Texas
Austin, Texas
Monte Montgomery,
Appellant,
v.
Monty Hitchcock,
Appellee
On appeal from Cause No. D-1-GN-14-000489
In the 250th Judicial District Court of Travis County, Texas
Honorable Jon N. Wisser, Judge Presiding
Appellant’s Opening Brief
_________________________
Steven R. Samples
State Bar No. 24086348
Samples Law Group
2605 Airport Freeway, Suite 100
Fort Worth, Texas 76111
817-500-0565 Direct
855-605-1505 Fax
srs@stevesamples.com
Attorney for Appellant
ii
IDENTITY OF PARTIES AND COUNSEL
Pursuant to Tex. R. App. P. 38.1(a), the Appellant presents the
following list of all parties and the names and address of counsel:
Appellant
Mr. Monte Montgomery.
Represented in the district court by:
Adam R. Hardison, Hardison Law Firm, 5050 Quorum
Drive, Suite 700, Dallas, Texas 75254, and
Steven R. Samples, Samples Law Group, 2605 Airport
Freeway, Suite 100, Fort Worth, Texas 76111
Represented on appeal by:
Steven R. Samples, Samples Law Group, 2605 Airport
Freeway, Suite 100, Fort Worth, Texas 76111
Appellee
Mr. Monty Hitchcock.
Represented in the district court by:
John Michael Smith, 3305 Northland Drive, Suite 500,
Austin, Texas 78731
Represented on appeal by:
John Michael Smith, 3305 Northland Drive, Suite 500,
Austin, Texas 78731
iii
TABLE OF CONTENTS
IDENTITY OF PARTIES AND COUNSEL ............................................................. iii
TABLE OF CONTENTS ..................................................................................... iv
CERTIFICATE OF COMPLIANCE ....................................................................... vii
CITATIONS TO THE RECORD ........................................................................... vii
INDEX OF AUTHORITIES................................................................................. viii
STATEMENT OF CASE ................................................................................... xiv
ISSUES PRESENTED ......................................................................................... XV
STATEMENT OF FACTS ..................................................................................... 1
SUMMARY OF ARGUMENT ................................................................................ 4
ARGUMENT ...................................................................................................... 5
A. A default judgment rendered after substituted
service must be reversed when the citation incorrectly
identifies the petition and the return of service recites
that process was served in the wrong county. ............................... 7
I. The return of service in this case is fatally flawed
and will not support a default judgment because
it recites that it was served in the wrong county. ............... 7
a. The service requirements are held to the
highest possible standard when substituted
service is used.......................................................... 9
iv
b. The Rule 106(b) order provides the sole
source of authority for non-personal service
and no variance is allowed. .................................... 10
II. Neither the order authorizing substituted service
nor the citation itself will support a default judgment
because the citation recites the wrong filing date for
the petition. ...................................................................... 11
III. The default judgment record does not establish that
Appellee presented sufficient evidence in support of
damages. .......................................................................... 12
B. A trial court abuses its discretion when it allows a motion for
new trial to be overruled by operation of law after the movant
establishes he is entitled to a new trial under Craddock ............. 15
I. Analysis under Craddock in not required in light of
the defective service. ........................................................15
II. Analysis under Craddock compels reversing the
default judgment. ............................................................ 16
a. The record shows no intent or conscious
indifference. ...........................................................17
b. The record shows a meritorious defense. .............. 18
c. Mr. Hitchcock cannot disprove a lack of delay
or injury. ................................................................ 20
v
III. The trial court clearly abused its discretion in
allowing Mr. Montgomery’s motion for new
trial to be overruled by operation of law. ......................... 22
PRAYER ........................................................................................................... 23
SIGNATURE PAGE ........................................................................................... 23
CERTIFICATE OF SERVICE ............................................................................... 24
FINAL JUDGMENT FROM COURT BELOW ............................................. APPENDIX
vi
CERTIFICATE OF COMPLIANCE
This document complies with the typeface requirements of TEX. R.
APP. P. 9.4(e) because it has been prepared in a conventional typeface no
smaller than 14-point for text and 12-point for footnotes.
I certify that this brief was prepared with Microsoft Word 2013, and
that, according to that program’s word-count function, the sections covered
by TRAP 9.4(i)(1) contain 4,765 words, thus bringing the brief into
compliance with the word-count limitations of that Rule.
______________________
Steven R. Samples
CITATIONS TO THE RECORD
This case includes a single-volume, sequentially-numbered clerk’s
record and citations to that record are in the format [CR ppp]. This case has
no reporter’s record.
vii
INDEX OF AUTHORITIES
CASES
Abcon Paving, Inc. v. Crissup,
820 S.W.2d 951 (Tex. App.—Fort Worth 1991) ...................................13
Angelo v. Champion Rest. Equip. Co.,
713 S.W.2d 96 (Tex. 1986). .................................................................. 20
Alvarado v. Reif,
783 S.W.2d 303 (Tex. App.—Eastland 1989) .......................................13
Bailey’s Furniture, Inc. v. Graham-Rutledge & Co.,
2012 Tex. App. LEXIS 10377
(Tex. App.—Dallas Dec. 13, 2012) ...................................................... 22
Bank One of Texas, N.A. v. Moody,
830 S.W.2d 81 (Tex. 1992). ................................................................... 7
Becker v. Russell,
765 S.W.2d 899 (Tex. App.—Austin 1989 ............................................ 6
Benefit Planners v. Rencare, Ltd.,
81 S.W.3d 855 (Tex. App.—San Antonio 2002).................................... 5
Berkefelt v. Jackson,
No. 01-07-00526-CV, 2008 Tex. App. LEXIS 7706
(Tex. App.—Houston [1st Dist.] Oct. 9, 2008) ..................................... 6
Blumenthal v. Ameritex Computer Corp.,
646 S.W.2d 283 (Tex. App.—Dallas 1983). ..........................................13
BLS Limousine Serv., Inc. v. Buslease, Inc.,
680 S.W.2d 543 (Tex. App.—Dallas 1984) ..........................................13
viii
Broussard v. Davila,
352 S.W.2d 753 (Tex. Civ. App.—San Antonio 1961). ........................ 10
Bryant v. Gamblin,
829 S.W.2d 228(Tex. App.—Eastland 1991) ........................................15
Burrows v. Bowden,
564 S.W.2d 474 (Tex. Civ. App.—Corpus Christi 1978)................ 12, 14
Cliff v. Huggins,
724 S.W.2d 778 (Tex. 1987) ................................................................... 6
Comanche Nation v. Fox,
128 S.W.3d 745 (Tex. App.—Austin 2004) ........................................17
Coronado v. Norman,
111 S.W.3d 838 (Tex. App.—Eastland 2003) ........................................ 5
Downer v. Aquamarine Operators, Inc.,
701 S.W.2d 238 (Tex. 1985). .................................................................. 7
Estate of Pollack v. McMurrey,
858 S.W.2d 388 (Tex. 1993) .......................................................... 19, 20
First Nat’l Bank v. Shockley,
663 S.W.2d 685 (Tex. App.—Corpus Christi 1983) .............................13
Flynt v. Kingsville,
82 S.W.2d 934 (Tex. 1935) ................................................................ 7, 8
Franks v. Montandon,
465 S.W.2d 800 (Tex. Civ. App.—Austin 1971).................................... 9
Furst v. Smith,
176 S.W.3d 864 (Tex. App.—Houston [1st Dist.] 2005) ....................... 5
ix
Gatlin v. Dibrell,
74 Tex. 36 (1889) ................................................................................... 8
Gen. Elec. Capital Auto Fin. Leasing Svcs., Inc. v. Stanfield,
71 S.W.3d 351 (Tex. App.—Tyler 2001) ............................................. 18
Gerland’s Food Fair, Inc. v. Hare,
611 S.W.2d 113 (Tex. Civ. App.—Houston [1st Dist.] 1980) ................. 8
Guardsman Life Ins. Co. v. Andrade,
745 S.W.2d 404 (Tex. App.—Houston [1st. Dist.] 1987). ................. 21
Hubicki v. Festina,
226 S.W.3d 405 (Tex. 2007) .............................................................. 5, 6
Irlbeck v. John Deere Co.,
714 S.W.2d 54 (Tex. App.--Amarillo 1986) ......................................... 14
Ivy v. Carrell,
407 S.W.2d 212 (Tex. 1966) ................................................................ 18
Jackson v. Mares,
802 S.W.2d 48 (Tex. App.—Corpus Christi 1990) ............................. 20
Jones v. Andrews,
873 S.W.2d 102 (Tex. App.—Dallas 1994) ...........................................15
Kelley v. Southwestern Bell Media, Inc.,
745 S.W.2d 447 (Tex. App.-Houston [1st Dist.] 1988) .........................13
Lara v. Rosales,
159 S.W.3d 121 (Tex. App.—Corpus Christi-Edinburg 2004) ............ 19
Limestone Construction, Inc. v. Summit Commercial Industrial Properties, Inc.,
143 S.W.3d 538 (Tex. App.—Austin 2004) ........................................... 6
x
Lopez v. Lopez,
757 S.W.2d 721 (Tex. 1988) ..................................................................15
McKanna v. Edgar,
388 S.W.2d 927 (Tex. 1965)............................................................... 7, 8
Mead v. Johnson Group, Inc.,
615 S.W.2d 685 (Tex. 1981) ................................................................. 19
Morgan v. Compugraphic Corp.,
675 S.W.2d 729 (Tex. 1984)................................................................. 12
Morgan Express, Inc. v. Elizabeth-Perkins, Inc.,
525 S.W.2d 312 (Tex. Civ. App.—Dallas 1975) ................................... 14
Noorani Gas & Convenience, Inc. v. State,
2008 Tex. App. LEXIS 2965
(Tex. App.—Austin, Apr. 24, 2008). ...........................................16, 22
Old Republic Ins. Co. v. Scott,
873 S.W.2d 381 (Tex. 1994) ..................................................................17
Pentes Design, Inc. v. Perez,
840 S.W.2d 75 (Tex. App.—Corpus Christi 1992). ........................... 12
Peralta v. Heights Medical Center. Inc.,
485 U.S. 80 (1988) ................................................................................15
Pierce-Fordyce Oil Ass’n v. Staley,
190 S.W. 814 (Tex. Civ. App.—Amarillo 1916) ..................................... 8
Pleasant Homes v. Allied Bank of Dallas,
776 S.W.2d 153 (Tex. 1989) ................................................................... 8
Republic W. Ins. Co. v. State,
985 S.W.2d 698 (Tex. App.—Austin 1999) ........................................... 5
xi
Roberts v. Stockslager,
4 Tex. 307 (1849). .................................................................................. 7
Royal Surplus Lines Ins. Co. v Samaria Baptist Church,
840 S.W.2d 382 (Tex. 1992) ................................................................ 10
Sgitcovich v. Sgitcovich,
241 S.W.2d 142 (Tex. 1951) ................................................................... 9
Simms v. Miears,
190 S.W. 544 (Tex. Civ. App.—Austin 1916) ....................................... 11
Sloan v. Batte,
46 Tex. 215 (1876).................................................................................. 7
Smith v. Commercial Equip. Leasing Co.,
678 S.W.2d 917 (Tex. 1984) ................................................................... 9
Strackbein v. Prewitt,
671 S.W.2d 37, 38-39 (Tex. 1984) ........................................................ 18
Stoner v. Thompson,
578 S.W.2d 679 (Tex. 1979). ................................................................. 11
STRA, Inc. v. Seafirst Commercial Corp.,
727 S.W.2d 591 (Tex. App.—Houston [1st Dist.] 1987) ...................... 14
Taylor v. State,
293 S.W. 913 (Tex. App.—Austin 2009) ............................................... 9
Trenton v. Hammitt,
No. 04-10-00316, 2010 WL 5545423
(Tex. App.—San Antonio, Dec. 29, 2010) ............................................ 9
Union Pac. Corp. v. Legg,
49 S.W.3d 72 (Tex. App.—Austin 2001)............................................... 8
xii
Uvalde Country Club v. Martin Linen Supply Co.,
690 S.W.2d 884 (Tex. 1985) .............................................................. 5, 7
Velasco v. Ayala,
312 S.W.3d 783 (Tex. App.—Houston [1st Dist.] 2009) ..................... 22
Ward v. Nava,
488 S.W.2d 736 (Tex. 1972)................................................................... 8
Wilson v. Dunn,
800 S.W.2d 833 (Tex. 1990) ........................................................... 5, 6, 7
OTHER
Tex. R. Civ. P. 241 ................................................................................... 12
Tex. R. Civ. P. 243 .............................................................................. 12, 14
xiii
STATEMENT OF CASE
The proceeding in the court below was a suit on a promissory note.
Mr. Montgomery appeals a no-answer default judgment entered against
him and appeals the overruling of his motion for new trial.
Mr. Montgomery asserts that the trial court never acquired personal
jurisdiction over him due to defects in the substituted-service procedure and
requests de novo review of this question of law. Mr. Montgomery further
requests review under an abuse of discretion standard of the trial court’s
decision to permit Mr. Montgomery’s motion for new trial to be overruled by
operation of law.
Upon review, Mr. Montgomery requests reversal and remand.
xiv
ISSUES PRESENTED
A. Whether a default judgment rendered after substituted
service must be reversed when the citation incorrectly
identifies the petition and the return of service recites that
process was served in the wrong county?
B. Whether a trial court abuses its discretion when it allows a
motion for new trial to be overruled by operation of law
after the movant establishes he is entitled to a new trial
under Craddock?
xv
STATEMENT OF FACTS
Mr. Montgomery is a professional musician living in Austin, Texas and
Mr. Hitchcock is a professional manager living in Nashville, Tennessee. [CR
49] The dispute between the parties stems from their professional relationship
within the music industry. [CR 49] Both parties claim default of agreements,
and each party asserts a claim against the other. [CR 49-50]
On or about January 13, 2014, counsel for Mr. Hitchcock mailed a
demand for payment to Mr. Montgomery. [CR 36] Upon receipt, Mr.
Montgomery forwarded the demand to his lawyer in Dallas, who telephoned
Mr. Hitchcock’s lawyer on January 31, 2014. [CR 39; 49] Counsel for Mr.
Hitchcock confirmed representation via facsimile. [CR 39, 53].
On February 17, 2014, Mr. Hitchcock sued Mr. Montgomery in the
250th Judicial District Court of Travis County, alleging default on a
promissory note. [CR 3-5 at 4]. Mr. Hitchcock’s Original Petition alleged
that Mr. Montgomery was a resident of Travis County. [CR 4].
The next day, on February 18, 2014, the Travis County District Clerk
issued a citation at the request of Mr. Hitchcock. [CR 12]. The citation
stated that Plaintiff’s Original Petition was attached but incorrectly identified
1
the Petition, stating that it was filed on February 18, 2014, not Fenruary 17,
2014. [CR 12].
Mr. Hitchcock’s counsel never notified Mr. Montgomery’s counsel
about the lawsuit, instead attempting to personally serve Mr. Montgomery.
[CR 24, 32].
In support of a Motion for Substituted Service, Mr. Hitchcock attached
an affidavit from a process server alleging service attempts on February 20
and 22, and then on May 1, 3, and 7. [CR 13]. The process server attempted
to explain the gap in service activity through statements of an unidentified
neighbor, attributing statements to that neighbor concerning Mr.
Montgomery’s travel plans, including a statement that Mr. Montgomery was
scheduled to return home on May 34, 2014. [CR 13].
Mr. Montgomery did not disclose his travel plans to any neighbor. [CR
49] During the time gap that the process server alleges Mr. Montgomery was
out of town, Mr. Montgomery actually performed concerts in Austin. [CR 49-
50].
On May 13, 2014, the 250th District Court, in reliance on the affidavit
of the process server and on the work of the district clerk, issued an order
authorizing service by delivery of the process to a person over age 16 or by
2
posting to the door of a dwelling. [CR 11]. Mr. Hitchcock’s counsel had still
not notified Mr. Montgomery’s counsel about the lawsuit. [CR 24, 32].
Mr. Hitchcock’s process server executed a return of service on May 15,
2014, swearing that service was effected at 4415 Cisco Valley Drive, Round
Rock, Texas 78664 in Williamson County, even though the Original Petition
correctly recites that Mr. Montgomery lives in Travis County. [CR 4, 13]
The process was never received by Mr. Montgomery. [CR 50].
In reliance on the citation prepared by the Travis County District
Clerk, the return of service prepared by the process server, and upon the
representations of Mr. Hitchcock’s counsel, the 250th District Court signed a
no-answer default judgment on July 9, 2014. [CR 17]. The district court’s
docket sheet does not indicate that Mr. Hitchcock filed a motion for default
judgment. [CR 68-69]. The judgment contains an award of attorney’s fees.
[CR 17] The record contains no evidence received in support of attorney’s
fees. The promissory note upon which Mr. Hitchcock’s claim is based in not
found within the record.
Mr. Montgomery filed a motion for new trial on August 8, 2014. [CR
22]. No hearing was held, and the motion was overruled by operation of law.
Mr. Montgomery perfected his appeal on October 7, 2014. [CR 60]
3
SUMMARY OF ARGUMENT
The default judgment obtained by Mr. Hitchcock against Mr.
Montgomery must be reversed because the trial court never acquired personal
jurisdiction over Mr. Montgomery. Specifically, Mr. Hitchcock attempted to
serve Mr. Montgomery via substituted service using a citation that
misidentified the petition, and then he sought (an obtained) a default
judgment even though the return of service reflected that service was made in
the wrong county. Because substituted service requires strict compliance with
the rules of civil procedure, Mr. Montgomery was never lawfully served, the
trial court lacked personal jurisdiction over him, and the default judgment will
not stand.
While the lack of service relieves Mr. Montgomery of the requirement
to make a showing under Craddock to obtain a new trial from the court below,
he nonetheless made such a showing and the trial court abused its discretion
in failing to grant a new trial.
4
ARGUMENT
A claim of defective service is a complaint about a court’s exercise of
personal jurisdiction over a defendant. Furst v. Smith, 176 S.W.3d 864, 868
(Tex. App.—Houston [1st Dist.] 2005, no pet.); Benefit Planners v. Rencare,
Ltd., 81 S.W.3d 855, 858 (Tex. App.—San Antonio 2002, pet. denied)
(“When the attempted service of process is invalid, the trial court acquires no
in personam jurisdiction over the defendant, and the trial court’s judgment is
void.”). Whether the trial court had personal jurisdiction over Mr.
Montgomery is a question of law. Coronado v. Norman, 111 S.W.3d 838, 841
(Tex. App.—Eastland 2003, pet. denied). Questions of law are reviewed de
novo. Republic W. Ins. Co. v. State, 985 S.W.2d 698, 701 (Tex. App.—Austin
1999, pet. dism’d).
A no-answer default judgment cannot withstand a direct attack by a
defendant who shows that he was not served in strict compliance with the
Texas Rules of Civil Procedure. Wilson v. Dunn, 800 S.W.2d 833, 836 (Tex.
1990); Hubicki v. Festina, 226 S.W.3d 405, 407 (Tex. 2007). In contrast to the
usual rule that presumptions will be made in support of a judgment, when
examining a default judgment, this court should make no presumption of valid
issuance, service, or return of citation. Uvalde Country Club v. Martin Linen
5
Supply Co., 690 S.W.2d 884, 885 (Tex. 1985) (per curiam). Failure to strictly
comply with the Rules of Civil Procedure renders any attempted service of
process invalid and of no effect. Hubicki, 226 S.W.3d at 408; Wilson, 800
S.W.2d at 836.
Rule 106(b) authorizes a court to order substituted service of process
upon a proper showing that the plaintiff has been unable to serve the
defendant through any default method listed in Rule 106(b). When a court
orders substituted service under Rule 106(b), the order itself provides the only
authority for the substituted service. Berkefelt v. Jackson, No. 01-07-00526-
CV, 2008 Tex. App. LEXIS 7706, 2008 WL 4530693, at *1 (Tex. App.—
Houston [1st Dist.] Oct. 9, 2008) (mem. op., not designated for
publication). As a result, “any deviation from the trial court’s order
necessitates a reversal of the default judgment based on service.” Id. (citing
Becker v. Russell, 765 S.W.2d 899, 900 (Tex. App.—Austin 1989, no writ)).
A trial court possesses broad discretion in ruling on a motion for new
trial. Cliff v. Huggins, 724 S.W.2d 778, 778-79 (Tex. 1987). Accordingly, a
court’s denial of a motion for new trial is reviewed for an abuse of discretion.
Id. When a motion for new trial is overruled by operation of law, as in this
case, the question presented is whether the trial court abused its discretion by
6
allowing the motion to be overruled. Limestone Construction, Inc. v. Summit
Commercial Industrial Properties, Inc., 143 S.W.3d 538, 542 (Tex. App.—
Austin 2004, no pet.), citing Bank One of Texas, N.A. v. Moody, 830 S.W.2d 81,
85 (Tex. 1992). A trial court abuses its discretion when it acts in an arbitrary
or unreasonable manner, or it acts without reference to any guiding principles
of law. Downer v. Aquamarine Operators, Inc., 701 S.W.2d 238, 241-42 (Tex.
1985).
A. A default judgment rendered after substituted service must be reversed
when the citation incorrectly identifies the petition and the return of
service recites that process was served in the wrong county.
I. The return of service in this case is fatally flawed and will not
support a default judgment because it recites that it was served in
the wrong county.
For well over a century, the Texas Supreme Court has required that
strict compliance with the rules for service of citation affirmatively appear on
the record for a default judgment to withstand direct attack. Wilson v. Dunn,
800 S.W.2d 833, 836 (Tex. 1990); Ulvade Country Club v. Martin Linen Supply
Co., 690 S.W.2d 884, 886 (Tex. 1985); McKanna v. Edgar, 388 S.W.2d 927,
929 (Tex. 1965); Flynt v. Kingsville, 125 Tex. 510, 82 S.W.2d 934 (1935); Sloan
v. Batte, 46 Tex. 215, 216 (1876); Roberts v. Stockslager, 4 Tex. 307 (1849).
There are no presumptions in favor of valid issuance, service, and return of
7
citation in the face of a direct attack on a default judgment. Ulvade, 690
S.W.2d at 836; McKanna, 388 S.W.2d at 929; Flynt, 82 S.W.2d at 934. Here,
the return recites that the process was served at an address in Williamson
County when Mr. Montgomery resides in Travis County.
“The return of service is not a trivial, formulaic document.” Union
Pac. Corp. v. Legg, 49 S.W.3d 72, 77 (Tex. App.—Austin 2001, no pet.), It has
long been considered prima facie evidence of the facts recited therein. See
Pleasant Homes v. Allied Bank of Dallas, 776 S.W.2d 153, 154 (Tex. 1989);
Gatlin v. Dibrell, 74 Tex. 36 (1889) (“The return of the officer imports
absolute verity, and was sufficient to authorize the rendition of judgment upon
default . . . .”). See also Gerland’s Food Fair, Inc. v. Hare, 611 S.W.2d 113, 116
(Tex. Civ. App.—Houston [1st Dist.] 1980, writ ref’d n.r.e.); Pierce-Fordyce
Oil Ass’n v. Staley, 190 S.W. 814, 815 (Tex. Civ. App.—Amarillo 1916, no
writ). The recitations in the return of service carry so much weight that they
cannot be rebutted by the uncorroborated proof of the moving party. See Ward
v. Nava, 488 S.W.2d 736, 738 (Tex. 1972); Sanders v. Harder, 227 S.W.2d
206, 209 (Tex. 1950); Gatlin, 11 S.W. at 909; Pierce-Fordyce, 190 S.W. at 815.
Of particular importance here, “the weight given to the return is no less when
8
the recitations impeach the judgment than when they support it.” Union Pac.
Corp. v. Legg, 49 S.W.3d 72, 77 (Tex. App.—Austin 2001, no pet.)
a. The service requirements are held to the highest possible standard
when substituted service is used.
Texas law prefers personal service over substituted service. Taylor v.
State, 293 S.W. 913, 915-16 (Tex. App.—Austin 2009, no pet.). Because
substituted service under Tex. R. Civ. P. 106(b) is in derogation of the
constitutional mandates of due process, the requirements of the rule and the
law connected therewith must be strictly construed and followed. See, e.g.,
Sgitcovich v. Sgitcovich, 241 S.W.2d 142 (Tex. 1951), cert. denied, 342 U.S. 903
(1952); Redwood Group, L.L.C. v. Louiseau, 113 S.W.3d 866, 868 (Tex. App.—
Austin 2003, no pet.); Franks v. Montandon, 465 S.W.2d 800, 801 (Tex. Civ.
App.—Austin 1971, no writ). Therefore, service under Rule 106(b) must be
strictly in accordance with the terms of the Rule 106 order and the return
must reflect the accomplishment of such service as precisely authorized by the
order. Smith v. Commercial Equip. Leasing Co., 678 S.W.2d 917, 918 (Tex.
1984) (per curiam).
9
b. The Rule 106(b) order provides the sole source of authority for
non-personal service and no variance is allowed.
Except on the terms of the order, there is no authority for substituted
service. See Trenton v. Hammitt, No. 04-10-00316, 2010 WL 5545423, at *1
(Tex. App.—San Antonio, Dec. 29, 2010, no pet.); Broussard v. Davila, 352
S.W.2d 753, 754 (Tex. Civ. App.—San Antonio 1961, no writ). When
reviewing an address problem similar to the one in this case, the Texas
Supreme Court reversed a default judgment due to a one-letter variance in the
address. Royal Surplus Lines Ins. Co. v Samaria Baptist Church, 840 S.W.2d
382, 383 (Tex. 1992) (default judgment based on substituted service set aside
because citation sent to 1201 “Bassie” rather than to 1201 “Bessie”).
Here, the return states service was made in Williamson County while
the petition upon which the trial court issued its substituted service order
reflects Travis County as Mr. Montgomery’s county of residence. The
substituted service order did not authorize service in Williamson County.
This flaw renders the service ineffective, the trial court never acquired
personal jurisdiction over Mr. Montgomery, and the default judgment must be
set aside.
10
II. Neither the order authorizing substituted service nor the citation itself will
support a default judgment because the citation recites the wrong filing
date for the petition.
As noted above, Plaintiff’s Original Petition was filed on February 17,
2014 but the citation recites that the Petition was filed on February 18, 2014.
[CR 3, 12]. The Austin Court of Appeals has twice-reversed a default
judgment under identical facts. Simms v. Miears, 190 S.W. 544, 544 (Tex. Civ.
App.—Austin 1916, no writ)(“On account of the failure of the citation to state
the true date of the filing of the plaintiff’s petition, we hold that the same is
void, and that the court acquired no jurisdiction over plaintiffs in error by
reason thereof, for which reason the judgment of the trial court is reversed,
and the cause remanded.”); Conner v. W. C. Bowman Lumber Co., , 239 (Tex.
Civ. App.—Austin 1931, no writ)(“Plaintiff in error in its brief raises the point
that the judgment should be set aside because of misstatement in the citation
of the date on which the petition was filed. This point is well taken, and would
in any event require a reversal of the judgment.”)
The same error is present in this case, and the same result should have
been reached in the court below. Mr. Montgomery requests reversal and
remand.
11
III. The default judgment record does not establish that Plaintiff presented
sufficient evidence in support of damages.
A defaulting party admits all allegations of fact set out in the petition,
except the amount of damages. See Stoner v. Thompson, 578 S.W.2d 679, 684
(Tex. 1979). The damages issue separately requires the plaintiff to prove a
causal link between the plaintiff’s injuries and the defendant’s actions to
ascertain the amount of damages to which the plaintiff is entitled. See Morgan
v. Compugraphic Corp., 675 S.W.2d 729, 732 (Tex. 1984).
Rule 243 does not prescribe either the manner in which a default
judgment hearing is to be conducted or the character of the evidence which is
required. Tex. R. Civ. P. 243. If damages are liquidated, no hearing is
necessary to present evidence of damages. Id. Rule 241 permits the trial court
to assess damages when the claim is liquidated and proved by an instrument in
writing. Tex. R. Civ. P. 241; Pentes Design, Inc. v. Perez, 840 S.W.2d 75, 79
(Tex. App.—Corpus Christi 1992, writ denied).
The term “liquidated” as used in Rule 241 means that the amount can
be calculated solely from the instrument sued on and the factual, as opposed to
conclusory, allegations in the plaintiff’s petition. See BLS Limousine Serv., Inc.
v. Buslease, Inc., 680 S.W.2d 543, 547 (Tex. App.—Dallas 1984, writ ref’d
12
n.r.e.); Burrows v. Bowden, 564 S.W.2d 474, 475 (Tex. Civ. App.—Corpus
Christi 1978, no writ). Additionally, a claim for reasonable attorney’s fees,
absent a contract therefor, is a claim for unliquidated damages. See First Nat’l
Bank v. Shockley, 663 S.W.2d 685, 691 (Tex. App.—Corpus Christi 1983, no
writ); Blumenthal v. Ameritex Computer Corp., 646 S.W.2d 283, 287 (Tex.
App.—Dallas 1983, no writ).
The written instrument must be attached to the petition. Abcon Paving,
Inc. v. Crissup, 820 S.W.2d 951, 953 (Tex. App.—Fort Worth 1991, no writ);
see also Alvarado v. Reif, 783 S.W.2d 303, 304-05 (Tex. App.—Eastland 1989,
no writ) (affidavit verifying automobile repair estimate did not transform
unliquidated claim into liquidated claim). Here, Mr. Hitchcock’s petition does
not include the written instrument upon which his lawsuit is based.
If liquidated claims are inadequately described in the petition, they are
considered unliquidated. Kelley v. Southwestern Bell Media, Inc., 745 S.W.2d
447, 448-49 (Tex. App.-Houston [1st Dist.] 1988, no writ). Here, the petition
only described the face amount of the note, its execution date, and the date of
the last payment. The amount of the payments, the number of payments
made, the outstanding balance, and the interest rate are all facts omitted from
13
the petition. A hearsay affidavit does not carry the weight of the actual
promissory note.
Without a sufficiently certain amount, the claim in this case is
unliquidated. See Burrows, 564 S.W.2d at 475; see also STRA, Inc. v. Seafirst
Commercial Corp., 727 S.W.2d 591, 594 (Tex. App.—Houston [1st Dist.] 1987,
no writ) (concluding claim on promissory note was unliquidated because
amended petition did not state date of default and amount of interest could
not be calculated from pleadings or instrument); Irlbeck v. John Deere Co., 714
S.W.2d 54, 57 (Tex. App.--Amarillo 1986, writ ref’d n.r.e.) (concluding claim
on promissory note was unliquidated). Accordingly, Mr. Hitchcock was
required to present evidence to support its claim for damages and attorney’s
fees. See Morgan Express, Inc. v. Elizabeth-Perkins, Inc., 525 S.W.2d 312, 314
(Tex. Civ. App.—Dallas 1975, writ ref’d); see also Tex. R. Civ. P. 243.
The record in this case includes an affidavit from Mr. Hitchcock. [CR
15] The affidavit bears no exhibit mark, and nothing in the record indicates the
trial judge took judicial notice of the affidavit prior to entering the default
judgment. Nothing else in the record indicates these affidavits were ever
actually offered or admitted into evidence before the court. As noted above,
when a claim is unliquidated, the rules require the court to “hear evidence as to
14
damages.” Tex. R. Civ. P. 243 (emphasis added). Because no evidence
regarding damages or attorney’s fees was admitted before the court, Mr.
Hitchcock failed to comply with the requirements of rule 243. See Jones v.
Andrews, 873 S.W.2d 102, 107 (Tex. App.—Dallas 1994, no writ)(holding that
unliquidated damages cannot be calculated from affidavit or other instrument
not introduced into evidence).
It was error for the trial court to fail to conduct a hearing and to require
proof of unliquidated damages before rendering a default judgment for such
damages. See id. The district clerk’s online docket sheet for this case does not
show that a hearing was held in this matter. Mr. Montgomery requests
reversal and remand.
B. A trial court abuses its discretion when it allows a motion for new trial to
be overruled by operation of law after the movant establishes he is entitled
to a new trial under Craddock
I. Analysis under Craddock in not required in light of the defective
service.
As a threshold matter, once the defaulting party identifies procedural
defects in service, he can set the default judgment aside on those grounds
without having to rely on Craddock. See Bryant v. Gamblin, 829 S.W.2d 228,
229 (Tex. App.—Eastland 1991, writ denied) (Craddock elements need not be
15
reached in post-appearance default judgment rendered without notice to
defendant). Further, in Peralta v. Heights Medical Center. Inc., the United
States Supreme Court held that the Texas requirement of showing of
meritorious defense in order to set aside a default judgment when a defendant
established an absence of service violated a party’s constitutional due process
rights. 485 U.S. 80 (1988); see also Lopez v. Lopez, 757 S.W.2d 721, 723 (Tex.
1988) (per curiam) (Applying Peralta to case where there was no notice of
hearing).
Mr. Montgomery has established two independent procedural defects
in service: First, the return recites service in the wrong county, and second,
the citation is void due its failure to accurately recite the filing date of the
petition. Nevertheless, Mr. Montgomery will briefly discuss the Craddock
factors as an independent ground for setting aside this default judgment.
II. Analysis under Craddock compels reversing the default judgment.
“A trial court abuses its discretion if it refuses to set aside a default
judgment and grant a new trial where (1) the defendant’s failure to answer or
appear was not intentional or the result of conscious indifference, but due to a
mistake or accident; (2) the motion for new trial sets up a meritorious defense;
and (3) granting a motion for new trial will not cause undue delay or otherwise
16
injure the party taking the default judgment.” Noorani Gas & Convenience, Inc.
v. State, 2008 Tex. App. LEXIS 2965, 9-10 (Tex. App.—Austin, Apr. 24,
2008, no pet.)
a. The record shows no intent or conscious indifference.
The Austin Court of Appeals has clearly stated the test: “In
determining whether there was conscious indifference we must look to the
knowledge and acts of the defendant.” Comanche Nation v. Fox, 128 S.W.3d
745, 756 (Tex. App.—Austin 2004, no pet.) As a matter of common sense,
these can be no intent not to answer, and can be no conscious indifference to
the necessity of answering, if a defendant does not know he has been sued.
The record shows the following:
i. Mr. Montgomery never received the petition and
citation;
ii. When Mr. Montgomery was first contacted Mr.
Hitchcock’s lawyer in January 2014, he immediately
referred the matter to his own lawyer; and
iii. When Mr. Montgomery received notice of the default
judgment in July 2014, he immediately referred the
matter to his lawyer.
Far from conscious indifference, Mr. Montgomery showed a pattern of
immediately responding to papers relating to this dispute. The record in this
case suggests that the process server’s affidavit must be viewed with
17
suspicion, but assuming that the return is merely wrong about the county in
which service was made and the server actually did post the process to the
door of Mr. Montgomery’s home, having the process blow away in the wind
or otherwise become lost is not intent or conscious indifference. Old Republic
Ins. Co. v. Scott, 873 S.W.2d 381, 382 (Tex. 1994) (plaintiff’s citation was
inadvertently included among files being transferred to another company);
Strackbein v. Prewitt, 671 S.W.2d 37, 38-39 (Tex. 1984) (papers misplaced in
defendant’s office, and confusion as to who was to send them to attorney).
Mr. Montgomery has established the first Craddock factor.
b. The record shows a meritorious defense.
The second element of Craddock requires the defendant moving for a
new trial after a default judgment to “set up” a meritorious defense — i.e.,
defendant need not prove a meritorious defense in the usual sense. Gen. Elec.
Capital Auto Fin. Leasing Svcs., Inc. v. Stanfield, 71 S.W.3d 351, 356 (Tex.
App.—Tyler 2001, no pet.). This means that the motion must allege facts
which in law would constitute a defense to the cause of action asserted by the
plaintiff and such must be supported by affidavits or other evidence proving
such a defense prima facie. Ivy v. Carrell, 407 S.W.2d 212, 214 (Tex. 1966).
18
The trial court may not try defensive issues in deciding whether to set aside
the default and may not consider counter affidavits or conflicting testimony
attempting to refute the movant’s factual allegations as to a meritorious
defense. Estate of Pollack v. McMurrey, 858 S.W.2d 388, 392 (Tex. 1993); Lara
v. Rosales, 159 S.W.3d 121, 124 (Tex. App.—Corpus Christi-Edinburg 2004,
pet. denied) (“The movant is not required to prove the truth of a meritorious
defense before trial, and the motion for new trial should not be denied on the
basis of contradictory evidence offered by the non-movant.”).
Here, the Defendant declares that “Mr. Hitchcock’s fail[ed] to provide
the services he promised me in exchange for my giving him a note. If I am in
default, Mr. Hitchcock went into default first.” [CR 50] The statement “sets
up” the defense that Mr. Hitchcock, the Plaintiff, committed the first material
breach, and that the Defendant has no further obligation to perform. See Mead
v. Johnson Group, Inc., 615 S.W.2d 685, 689 (Tex. 1981) (“Default by one
party excuses performance by the other party.”)
Mr. Montgomery has established the second Craddock factor.
19
c. Mr. Hitchcock cannot disprove a lack of delay or injury.
The third element of Craddock requires a movant to demonstrate that
setting aside the default judgment would not cause a delay or otherwise injure
the plaintiff. Once a movant makes that representation in its motion, the
burden of going forward with proof of injury shifts to the plaintiff because
these are matters particularly within his knowledge. Angelo v. Champion Rest.
Equip. Co., 713 S.W.2d 96, 98 (Tex. 1986). If plaintiff fails to do so, defendant
has met the third element of Craddock. Estate of Pollack, 858 S.W.2d at 393. A
plaintiff’s loss of the economic benefit derived from the entry of the default
judgment does not constitute hardship or delay that will bar granting a new
trial. Jackson v. Mares, 802 S.W.2d 48, 52 (Tex. App.—Corpus Christi 1990,
writ denied). And while vacating a final default judgment and granting a new
trial will invariably delay final resolution of a case, plaintiff should be required
to show that the granting of the new trial would cause delay substantially
beyond that which plaintiff would have faced had defendant timely answered.
As the Corpus Christi Court of Appeals noted in Jackson v. Mares:
The purpose of the final element of the Craddock rule, however,
is to protect a plaintiff against the sort of undue delay or injury
which disadvantages him in presenting the merits of his case at a
20
new trial, such as loss of witnesses or other valuable evidence
upon retrial.
802 S.W.2d 48, 52 (Tex. App.—Corpus Christi 1990, writ denied).
When making this determination, the trial court is entitled to look at the
conduct of the plaintiff. For example, one court concluded that the
plaintiff/insured would not be injured by the granting of a new trial where
plaintiff had waited over 20 months to file suit after being informed of the
defendant insurer’s intent not to pay face value of the policies and plaintiff’s
suit had been pending only a short time at the time default judgment was
rendered. See Guardsman Life Ins. Co. v. Andrade, 745 S.W.2d 404, 406 (Tex.
App.—Houston [1st. Dist.] 1987, writ denied). Mr. Hitchcock’s affidavit
alleges that Mr. Montgomery made his last payment in December 2010. [CR
30] Suit was not filed for three years, and was on file for less than six months
when Mr. Montgomery filed his motion for new trial. [CR 3, 22].
Here, Mr. Montgomery cannot answer a lawsuit that was never served
upon him, and any delay was caused by the conduct of the Mr. Hitchcock. It
strains belief that a plaintiff with a valid claim would navigate the procedures
for substituted service when the plaintiff’s lawyer knew the defendant was
represented by a lawyer who was a mere phone call away. Mr. Hitchcock
21
carries the ultimate burden under the third Craddock factor to prove delay or
injury. He cannot meet that burden. Accordingly, Mr. Montgomery has
established all three Craddock factors and requests reversal and remand.
III. The trial court clearly abused its discretion in allowing Mr. Montgomery’s
motion for new trial to be overruled by operation of law.
Because Mr. Montgomery was not duly served with citation under the
law, the trial court did not acquire personal jurisdiction over him and the trial
court’s judgment is void. The trial court abused its discretion by failing to
grant his motion for new trial. Velasco v. Ayala, 312 S.W.3d 783, 800 (Tex.
App.—Houston [1st Dist.] 2009, no pet.); Bailey’s Furniture, Inc. v. Graham-
Rutledge & Co., 2012 Tex. App. LEXIS 10377, 5-6 (Tex. App.—Dallas Dec.
13, 2012, no pet.). For this reason, Mr. Montgomery requests reversal and
remand.
And under the Craddock standard, a “trial court abuses its discretion if
it refuses to set aside a default judgment and grant a new trial where (1) the
defendant’s failure to answer or appear was not intentional or the result of
conscious indifference, but due to a mistake or accident; (2) the motion for
new trial sets up a meritorious defense; and (3) granting a motion for new trial
will not cause undue delay or otherwise injure the party taking the default
22
judgment.” Noorani Gas & Convenience, Inc. v. State, 2008 Tex. App. LEXIS
2965, 9-10 (Tex. App.—Austin, Apr. 24, 2008, no pet.). Because Mr.
Montgomery met this three-part test, a new trial was warranted and he
requests reversal and remand.
Prayer
Wherefore, Premises Considered, Mr. Montgomery prays
that the default judgment against him be reversed and that this case be
remanded to the trial court.
Respectfully submitted,
__________________________
Steven R. Samples
State Bar No. 24086348
Samples Law Group
2605 Airport Freeway, Suite 100
Fort Worth, Texas 76111
817-500-0565 Direct
855-605-1505 Fax
srs@stevesamples.com
23
CERTIFICATE OF SERVICE
The undersigned personally certifies that a true and correct copy of the
foregoing document was personally served on the following counsel of record
via electronic service through efile.txcourts.gov on January 2, 2015.
John Michael Smith
3305 Northland Drive, Suite 500
Austin, Texas 78731
Counsel for Mr. Hitchcock
Adam R. Hardison
Hardison Law Firm
5050 Quorum Drive, Suite 700
Dallas, Texas 75254
Counsel for Mr. Montgomery
___________________
Steven R. Samples
24
APPENDIX
Appendix
DC BK14196 PG42
None Filed in The District Court
9
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ut o !"Y
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sent. - of Travis County, Texas
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§ TRAVIS COUNTY, 'Et:.�S
§
MONTE MONTGOMERY, §
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Defendant § 250th JUDICIA� DISTRICT
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FINAL JUDGMENT
CAME ON THIS DAY, the above-referenced matter.
·.SS
LUrt having determined that
Defendant Monte Montgomery has been served, but has not file_..:: answer, orders as follows:
IT IS ORDERED by the Court that the plaintiff, M
damages from defendant, Monte Montgomery, in the sum
IT IS FURTHER ORDERED that plaintiff, Mo1· Hitchcock, recover reasonable and
._c..
necessary attorney's fees of$ l &, S 0 from tl:->;\.mte Montgomery.
0
IT IS FURTHER ORDERED that the a 11( unt of Judgment Amount will bear interest at
the rate of 8% from this date until paid. ,.�
.,,_,
·s
All costs of court spent or incurre� :n this cause are adjudged against Defendant.
vo·
All writs and processes for the �morcement and collection of this judgment or the costs
of court may issue as necessary.
All relief requested in t,,_._s case and not expressly granted in this judgment is denied.
This judgment finally dispo ·c..; of all parties and claims and is appealable.
'
SIGNED, this day of July 2014.
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Monte Montgomery v. Monty Hitchcock
Combined Opinion