ACCEPTED
01-15-00624-CV
FIRST COURT OF APPEALS
HOUSTON, TEXAS
8/14/2015 8:53:28 AM
CHRISTOPHER PRINE
CLERK
No. 01–15–624–CV
_______________________________________________________
FILED IN
In the First Court of Appeals 1st COURT OF APPEALS
HOUSTON, TEXAS
Houston, Texas
8/14/2015 8:53:28 AM
_______________________________________________________
CHRISTOPHER A. PRINE
Clerk
In re:
Rescue Concepts, Inc.,
Relator.
_______________________________________________________
Original proceeding from the
270th Judicial District Court, Harris County, Texas
Honorable Brent Gamble
_______________________________________________________
Reply in Support of Petition for Writ of Mandamus
_______________________________________________________
James G. Munisteri Gardere Wynne Sewell LLP
State Bar No. 14667380 2000 Wells Fargo Plaza
John MacVane 1000 Louisiana Street
State Bar No. 24085444 Houston, Texas 77002
Tel: 713.276.5500
Fax: 713.276.5555
Email: jmunisteri@gardere.com
jmacvane@gardere.com
- and -
Jacqueline Lucci Smith LUCCI SMITH LAW, PLLC
State Bar No. 00786073 10575 Katy Freeway, Suite 405
Houston, Texas 77024
Telephone: (832) 494-1700
Facsimile: (832) 494-1426
Email: jacq@luccismithlaw.com
ATTORNEYS FOR PLAINTIFF RESCUE CONCEPTS INC.
ORAL ARGUMENT REQUESTED
Table of Contents
Page
Table of Contents ................................................................................................... ii
Table Of Authorities ............................................................................................. iii
Argument .................................................................................................................1
I. HouReal’s argument makes this an incredibly simple
mandamus. ..........................................................................................1
A. HouReal’s reading creates the absurd result of
making service the only requirement to avoid
expunction of a lis pendens. ...................................................3
B. HouReal’s reading is contrary to the cases
construing the statute. .............................................................5
C. HouReal’s application of In re Cohen misses the
mark. ..........................................................................................6
II. RCI stands on its remaining arguments..........................................7
Prayer for Relief.......................................................................................................8
Certificate of Service/Compliance .......................................................................9
ii
Table Of Authorities
Page(s)
CASES
City of Dallas v. TCI W. End, Inc.,
No. 13-0795, 2015 WL 2147986
(Tex. May 8, 2015) (slip op.) (per curiam)...........................................................2
City of Lorena v. BMTP Holdings, L.P.,
409 S.W.3d 634 (Tex. 2013).............................................................................2
Gunn v. Phillips, 410 S.W.2d 202
(Tex. Civ. App.—Houston 1966, writ ref’d n.r.e) ..............................................2
In re Cohen, S.W.3d 889
(Tex. App.—Houston [1st Dist.] 2011, no pet.)…………………………….. 6, 7
In re Moreno, No. 14-14-00929-CV, 2015 WL 225049
(Tex. App.—Houston [14th Dist.] Jan. 15, 2015, no pet.) .................................5
Nat’l City Bank of Indiana v. Ortiz, 401 S.W.3d 867
(Tex. App.—Houston [14th Dist.] 2013, pet. denied) .................................4, 5
Sw. Bell Tel., L.P. v. Emmett, 459 S.W.3d 578, 588 (Tex. 2015). ..........................3
STATUTES
TEX. PROP. CODE ANN. § 12.0071...................................................................passim
OTHER AUTHORITIES
ANTONIN SCALIA & BRYAN A. GARNER,
READING LAW: THE INTERPRETATION OF LEGAL TEXTS 116 (2012)……………...2
.
iii
Argument
I. HouReal’s argument makes this a simple mandamus.
HouReal Corporation (“HouReal”) is absolutely correct that the crux
of this case is interpretation of section 12.0071 of the Texas Real Property
Code. As HouReal’s response makes clear:
HouReal does not dispute that the proper remedy for wrongful
denial of a motion to expunge is mandamus,
Nor does HouReal dispute that Rescue Concepts, Inc. (“RCI”)
properly raised and preserved the bases for expunction stated
in its mandamus petition,
Nor does HouReal even argue that it “establish[ed] by a
preponderance of the evidence the probable validity of [its]
real property claim.”
Instead HouReal relies exclusively on a simple, flawed argument.
According to HouReal, because section 12.0071 requires expunction “if the
court determines” that any one of three situations exists, the statute
supposedly gives the trial court unlimited discretion to determine which of
the three scenarios to examine.
HouReal cites no statute—and RCI has found none—that has been
construed to allow the trial court to decide—willy-nilly—which statutory
requirements to examine and which to disregard. HouReal simply
1
contends that the trial court was free to completely ignore the argument
that HouReal could not establish the probable validity of its claim—in its
discretion—for any reason or no reason.
HouReal’s interpretation of the expunction statute to confer such
discretion is nonsense. The word “or,” as used in section 12.0071, joins a
disjunctive list. See ANTONIN SCALIA & BRYAN A. GARNER, READING LAW:
THE INTERPRETATION OF LEGAL TEXTS 116 (2012). The Texas cases standing
for this proposition are legion. See, e.g., City of Dallas v. TCI W. End, Inc., No.
13-0795, 2015 WL 2147986, at *4 (Tex. May 8, 2015) (slip op.) (per curiam)
(“The statute's use of ‘or,’ a disjunctive, identifies two alternative bases for
recovering civil penalties.”); City of Lorena v. BMTP Holdings, L.P., 409
S.W.3d 634, 642 (Tex. 2013) (“We have previously held that the
Legislature's use of the disjunctive word ‘or’ is significant when
interpreting statutes.”); Gunn v. Phillips, 410 S.W.2d 202, 206 (Tex. Civ.
App.—Houston 1966, writ ref’d n.r.e) (“[T]he word ‘or’ is a disjunctive
conjunction that indicates a choice between two alternatives generally
corresponding to ‘either’ or ‘either this or that’.”).
And in section 12.0071 the legislature plainly required that “a court
shall order the notice of lis pendens expunged if the court determines that:
2
(1) the pleading on which the notice is based does not
contain a real property claim;
(2) the claimant fails to establish by a preponderance of
the evidence the probable validity of the real
property claim; or
(3) the person who filed the notice for record did not
serve a copy of the notice on each party entitled to a
copy under Section 12.007(d).” (Emphasis added).
“The use of the word ‘shall’ evidences the mandatory nature of the
duty imposed . . . .” See Sw. Bell Tel., L.P. v. Emmett, 459 S.W.3d 578, 588
(Tex. 2015). In this case, that mandatory duty is on the trial court to
expunge the lis pendens if the claimant fails to plead, prove, or properly
serve the notice of lis pendens.
HouReal’s construction would be a complete anomaly in statutory
interpretation case law—as evidenced by the absence of a single cited
authority applying such a construction to any statute—ever.
A. HouReal’s reading creates the absurd result of making
service the only requirement to avoid expunction of a lis
pendens.
HouReal’s reading leads to the absurd result of allowing a trial court
to leave a lis pendens on file that is neither pleaded nor proved if the lis
pendens has been properly served. According to HouReal, the trial court
3
has discretion to determine which of the three disjunctive sections to
examine (even if—as undisputedly happened here—more than one basis
for expunction is raised). Thus, according to HouReal, a court would be
within its discretion to ignore (1) that no real property claim had been pled,
and (2) that no probable right had existed, and to focus entirely on the third
item in the disjunctive list: that the person who filed the lis pendens served
it according to section 12.007(d) of the Texas Property Code.
This reading of the statute cannot plausibly be entertained. To the
contrary, the revisions to section 12.0071 “mark[ed] a substantial change in
the legal standard by which parties can seek expunction of notices of lis
pendens” because it “includ[ed] language that requires consideration of the
merits of the claim that forms the basis of the lis pendens.” Nat'l City Bank
of Indiana v. Ortiz, 401 S.W.3d 867, 903-04 (Tex. App.—Houston [14th Dist.]
2013, pet. denied) (Frost, J., dissenting). The purpose of the amendments
was thus to add means of obtaining expunction, not give a trial court
discretion to leave lis pendens undisturbed whenever they were properly
served. See id.
4
B. HouReal’s reading conflicts with cases construing the
statute.
As the Houston Fourteenth Court of Appeals has explained,
“[s]ection 12.0071 identifies three circumstances in which the trial court
‘shall order the notice of lis pendens expunged.’” In re Moreno, No. 14-14-
00929-CV, 2015 WL 225049, at *2 (Tex. App.—Houston [14th Dist.] Jan. 15,
2015, no pet.) quoting Tex. Real Prop. Code Ann. § 12.0071. The Fourteenth
Court’s language is clear; three separate scenarios exist that require
expunction.
In another case, the Fourteenth Court described section 12.0071 as
requiring that “[t]he court shall order the notice of lis pendens expunged if
the court determines that . . . the claimant fails to establish by a
preponderance of the evidence the probable validity of the real property
claim . . . .” Nat'l City Bank of Indiana, 401 S.W.3d at 887 (ellipses original).
These cases do nothing more than rephrase the plain language of the
statute. Put simply, HouReal could not be more wrong. This is a simple
mandamus requiring this Court to do no more that read the statute and
apply its plain language. The word “or” means that the trial court shall
expunge the lis pendens if the claimant failed to plead, prove or properly
5
serve the notice of lis pendens.
C. HouReal’s reading of In re Cohen misses the mark.
HouReal misinterprets In re Cohen as holding that a court has free
reign to disregard certain elements of the lis pendens statute at its pleasure.
See Response to Relator’s Petition for Writ of Mandamus, at 10.
But In re Cohen, in fact, says the exact opposite. According to In re
Cohen, “The court must grant the motion if (1) ‘the pleading on which the
notice is based does not contain a real property claim,’ or (2) ‘the claimant
fails to establish by a preponderance of the evidence the probable validity
of the real property claim.’” S.W.3d 889, 892 (Tex. App.—Houston [1st
Dist.] 2011, no pet.). Nowhere did the Cohen court say or suggest a trial
court may avoid its mandatory obligation to expunge by focusing on one
requirement and ignoring other requirement.
Contrary to HouReal’s argument, the “probable validity” basis for
expunging lis pendens was not analyzed in In re Cohen. According to the
court’s opinion, the “probable validity” basis “ha[d] yet to be addressed by the
trial court, rendering review . . . premature.” Id. at 899-900 (emphasis added).
In stark contrast to In re Cohen, RCI did raise that HouReal failed to
establish by a preponderance of evidence the probable validity of a real
6
property claim. This assertion was both (1) raised by RCI’s motion, (see
Tab I, R. 63)—as HouReal does not dispute—and (2) addressed by
HouReal’s response—which said that HouReal had no need to establish
probable validity (Tab E, R. 37, at ¶¶2-3).
Thus the probable validity prong was squarely before the trial court.
But HouReal did not prove probable validity—nor does HouReal contend
that it did—and the trial court abused its discretion by denying the motion
to expunge.
II. RCI stands on its remaining arguments.
For the reasons discussed above, this Court need not address the
second ground. Should this Court reach HouReal’s argument that it pled a
real property claim in the amended petition, HouReal stands on its
argument that HouReal did not plead a claim that entitled it to lis pendens.
These arguments are explained in Part II.B. of RCI’s mandamus petition.
HouReal’s response largely ignores these arguments that provide an
independent—albeit slightly less straightforward—basis for granting
mandamus relief.
7
Prayer for Relief
For the foregoing reasons, RCI asks this Court to issue a writ of
mandamus:
(a) directing the district court to vacate its Order Denying Rescue
Concepts, Inc.’s Motion to Expunge Lis Pendens, signed on July 13, 2015, in
the underlying lawsuit, HouReal Corporation v. Rescue Concepts, Inc., No.
2014-71749 (270th J. Dist. Ct., Harris Cty., Tex., filed Dec. 10, 2014);
(b) directing the district court to order HouReal’s lis pendens, a copy
of which is located at Tab E, R. 39-40, expunged pursuant to section 12.0071
of the Texas Real Property Code; and
(c) taxing costs against Real Party in Interest, HouReal Corporation.
Respectfully submitted,
-and-
/s/ James G. Munisteri
James G. Munisteri /s/Jacqueline Lucci Smith
State Bar No. 14667380 Jacqueline Lucci Smith
John MacVane LUCCI SMITH LAW, PLLC
State Bar No. 24085444 Texas Bar Number: 00786073
GARDERE WYNNE SEWELL LLP 10575 Katy Freeway, Suite 405
2000 Wells Fargo Plaza Houston, Texas 77024
1000 Louisiana Street Telephone: (832) 494-1700
Houston, Texas 77002 Facsimile: (832) 494-1426
Telephone: (713) 276-5500 Email: jacq@luccismithlaw.com
Facsimile: (713) 276-5555
Email: jmunisteri@gardere.com ATTORNEYS FOR PLAINTIFF
Email: jmacvane@gardere.com RESCUE CONCEPTS INC.
8
Certificate of Service/Compliance
I certify that a copy of this document was served by efiling, as
follows, on August 14, 2015.
Mr. Gregory N. Jones Hon. Brent Gamble
Law Office of Gregory N. Jones 270th Judicial District Court
2323 S. Shepherd, 14th Floor Harris County Civil Courthouse
Houston, Texas 77019 201 Caroline, 13th Floor
Email: gjones@gnjlaw.net Houston, Texas 77002
Facsimile: (713) 979-4440 [By Efiling to the email address of the
[by Efiling] Court’s clerk, Danielle Gutierrez at
Danielle.Gutierrez@hcdistrictclerk.com]
Counsel for
HouReal Corporation
I further certify that this document contains 1,509 words. To prepare
this certificate, I relied upon the word count of the computer program used
to prepare this document.
/s/ James G. Munisteri
James G. Munisteri
9
Gardere01 - 6934908v.1
in Re Rescue Concepts, Inc.
Combined Opinion