I agree with most of the majority's opinion, but respectfully dissent from that part of the opinion ordering Judge Street to abate the Stowers1 case.
Specifically, I do not agree that a Stowers case against an insurer does not accrue until the termination of the appellate proceedings in the original tort action against the insured.
The majority holds that a Stowers cause of action does not accrue until final resolution of the appeal of the original tort suit. In reaching this decision, the majority relies on the recent supreme court case of Arnold v. Nat. CountyMut. Fire Ins. Co., 725 S.W.2d 165 (Tex. 1987). The supreme court's opinion in Arnold does hold that the statute of limitations on a Stowers case begins to run when the judgment is final. Id. at 168. However, the court's opinion does not state when the judgment becomes final.
Nonetheless, the supreme court relied on one of its prior decisions in making the determination that the statute of limitations does not begin to run until the judgment is final.Linkenhoger v. American Fidelity Casualty Co., 152 Tex. 534,260 S.W.2d 884 (1953). In that case, an insurance company defended a Stowers case by stating that the statute of limitations begins to run in a Stowers case when the insurance company rejects a reasonable settlement offer. Id. 260 S.W.2d at 885. The supreme court rejected this argument and stated that the statute of limitations does not begin to run until the judgment becomes final. Id. at 887. Although the opinion does not so state, it is obvious from the dates involved that the supreme court assumed that a judgment was final only once the appellate process had been exhausted.Id. at 885.
The concept of finality in Texas has radically changed sinceLinkenhoger was decided. Our supreme court recently adopted the Restatement (Second) of Judgments' concept of finality. Scurlock Oil Co. v. Smithwick, 724 S.W.2d 1, 6 (Tex. 1986). In Scurlock Oil, the supreme court was confronted with the issue of when a judgment can be used for res judicata, collateral estoppel, and issue preclusion purposes. Id. at 5-6. The court recognized that Texas was one of only a few jurisdictions which held that a judgment is not final for preclusion purposes while appeal is pending. Id. at 5. As a result, the supreme court overruled a line of Texas cases and adopted section 13, comment f of the Restatement, which provides:
[T]he better view is that a judgment otherwise final remains so despite the taking of an appeal unless what is called an appeal actually consists of a trial de novo.
RESTATEMENT (SECOND) OF JUDGMENTS sec. 13 comment f (1982).
In that case, Scurlock Oil argued that a judgment on appeal should be denied the character of finality necessary to allow its admission into evidence in a subsequent trial. The supreme court noted there were disadvantages to the new finality rule, but rejected Scurlock's arguments holding that the prior finality law had a greater potential for harm. ScurlockOil, 724 S.W.2d at 6.
The situation before us is analogous to that in ScurlockOil. A judgment, in excess *Page 551 of the insured's policy limits, has been entered against the insured. No supersedeas bond has been filed to supersede the enforcement of the judgment. As a result, the insureds remain at risk.
It is true that if our court reverses the judgment of the trial court, the insured's cause of action against the insurance company will suffer. However, this harm is no less than the application of the finality rule in res judicata, collateral estoppel, and issue preclusion cases. In most cases, a judgment in a second case based upon preclusive effects of a prior judgment cannot stand if the first judgment is reversed. As a result, the reversal of the first judgment may result in two retrials, although this outcome is not automatic. See RESTATEMENT (SECOND) OF JUDGMENTS sec. 16 (1982).
I dissent from that part of the majority's opinion which issues the writ of mandamus ordering the trial court to abate the cause of action. However, I concur with those parts of the majority's opinion which refuse to grant a writ of mandamus ordering the trial court to dismiss the Rileys' intervention, and refusing to grant a writ of mandamus ordering the trial court to stay all discovery pending the exhaustion of appellate remedies.