Stephen Aaron Bergenholtz v. Josephine Donna Eskenazi

AFFIRM; and Opinion Filed July 23, 2015.




                                          S    In The
                                Court of Appeals
                         Fifth District of Texas at Dallas
                                       No. 05-14-00609-CV

                       STEPHEN AARON BERGENHOLTZ, Appellant
                                       V.
                         JOSEPHINE DONNA ESKENAZI, Appellee

                       On Appeal from the 366th Judicial District Court
                                    Collin County, Texas
                           Trial Court Cause No. 366-00117-2014

                              MEMORANDUM OPINION
                  Before Chief Justice Wright and Justices Brown and Stoddart
                                   Opinion by Justice Brown
       Stephen Aaron Bergenholtz (Husband) filed a petition for bill of review seeking to set

aside a modified final decree of divorce. Josephine Donna Eskenazi (Wife) filed a motion to

dismiss the bill of review. The trial court dismissed Husband’s bill of review, citing Husband’s

failure to exercise due diligence in pursuing all available legal remedies against the judgment. In

three issues, Husband contends the trial court erred in dismissing his petition. For reasons that

follow, we affirm the trial court’s order dismissing the bill of review.

       Wife filed for divorce. The parties eventually entered into an Agreement Incident to

Divorce (AID), which divided the marital estate and named the parties joint managing

conservators of their two children. An October 20, 2009 agreed decree of divorce incorporated

the parties’ agreement. In January 2010, the court modified the agreed final decree. Husband

appealed the modified decree, generally asserting the trial court improperly modified the agreed
property division at Wife’s request. While the appeal was pending, Husband and Wife entered

into a Settlement Agreement which purported to be a complete and final compromise of their

dispute over the division of their assets. The agreement set a sliding scale for payment of the

cash settlement awarded to Wife in the decree. Husband could pay different amounts, less than

or equal to the original amount, depending on how soon he paid. One of the terms of the

agreement was that Husband would move to dismiss his pending appeal in this Court. On July

14, 2011, the trial court held a hearing and approved the parties’ Settlement Agreement. The

agreement was filed with the court as a rule 11 agreement. Husband filed an unopposed motion

to dismiss his appeal. We granted the motion and dismissed the appeal. See Bergenholtz v.

Bergenholtz, No. 05-10-00478-CV, 2011 WL 3484802, at *1 (Tex. App.—Dallas Aug. 10, 2011,

no pet.) (mem. op.).

       Over two years later, on January 16, 2014, Husband filed his pro se original petition for

bill of review. He amended his petition twice, and his live pleading is ninety-one pages long.

Husband contended Wife intentionally concealed the true nature of the assets divided in the

divorce and denied him a just and right division of the true value of the community estate. He

alleged Wife committed fraud by failing to disclose bank accounts, cash, and the true and correct

value of certain assets. Husband asserted he learned of Wife’s extrinsic fraud in March 2012 and

that the fraudulent acts compelled him to enter into the agreed decree and the July 2011

Settlement Agreement. Husband asked the court to set aside the modified final decree of divorce

as well as the Settlement Agreement. Husband supported his bill of review with his own

affidavit and the affidavit of a certified public accountant.

       Wife filed a motion to dismiss the bill of review. The motion asked the court to dismiss

the bill of review under rule of civil procedure 91a. In the motion, Wife asserted various reasons

the motion should be granted, including that Husband failed to plead at least one meritorious

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defense, failed to establish extrinsic fraud, and failed to establish that he was not negligent or at

fault. Wife further alleged that Husband permitted the underlying judgment to become final by

failing to appeal and thus he was not entitled to relief by bill of review. 1 She also asserted

Husband’s action had no basis in law or fact.

             The trial court held a hearing on the motion to dismiss at which it heard the argument of

the parties. Wife argued that Husband was not permitted to seek bill-of-review relief because he

had not exhausted his legal remedies as he had filed an appeal and dismissed it. Husband argued

that the division of property was not just and equitable because there were assets he did not know

about until 2012. The trial court orally granted the motion to dismiss. That same day, the trial

court signed an order dismissing Husband’s bill of review with prejudice. The order stated that

Husband “is not entitled to relief from a Bill of Review for the reason that [he] did not exercise

due diligence in pursuing all available legal remedies against the judgment.”                                             This appeal

followed. 2

             A bill of review is an equitable proceeding brought by a party seeking to set aside a prior

judgment that is no longer subject to challenge by a motion for new trial or an appeal. Caldwell

v. Barnes, 154 S.W.3d 93, 96 (Tex. 2004). The grounds upon which a bill of review can be

obtained are narrow because the procedure conflicts with the fundamental policy that judgments

must become final at some point. Transworld Fin. Servs. Corp. v. Briscoe, 722 S.W.2d 407, 407

(Tex. 1987). A bill of review plaintiff must ordinarily plead and prove (1) a meritorious defense

to the underlying cause of action, or if applicable, a meritorious ground for appeal; (2) which the

plaintiff was prevented from making by the fraud, accident, or wrongful act of the opposing

     1
        In her motion to dismiss, Wife referred to the wrong appellate cause number in making this argument. She cited cause number 05-10-
00078-CV, which was an appeal from the original divorce decree, before the court modified it. Husband notified us that he wished to withdraw
that notice of appeal, and we dismissed the appeal. In re Marriage of Bergenholtz, No. 05-10-00078-CV, 2010 WL 1224736, at *1 (Tex. App.—
Dallas 2010, no pet.) (mem. op.).
     2
         Husband is represented by counsel in this appeal. Wife did not file an appellee’s brief.



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party or by official mistake, (3) unmixed with any fault or negligence on the plaintiff’s part.

Transworld, 722 S.W.2d at 407; see Morris v. O’Neal, No. 14-14-00252-CV, 2015 WL

1622184, at *2 (Tex. App.—Houston [14th Dist.] Apr. 7, 2015, no pet.) (citing Baker v.

Goldsmith, 582 S.W.2d 404, 408 (Tex. 1979)). If the petitioner establishes prima facie proof of a

meritorious defense, the court should proceed with a trial on the merits of the petition. In re

L.N.M., 182 S.W.3d 470, 474 (Tex. App.—Dallas 2006, no pet.) (determination of whether

prima facie meritorious defense has been made out is question of law for trial judge).

           The third bill-of-review element, lack of fault or negligence, requires a party to show that

it diligently pursued all adequate legal remedies against a former judgment. Mabon Ltd. v. Afri-

Carib Enters., Inc., 369 S.W.3d 809, 813 (Tex. 2012) (per curiam); see Wembley Inv. Co. v.

Herrera, 11 S.W.3d 924, 927 (Tex. 1999) (per curiam). If legal remedies were available, but

ignored, relief by equitable bill of review is unavailable. Wembley, 11 S.W.3d at 927; see Gold

v. Gold, 145 S.W.3d 212, 214 (Tex. 2004) (“If a motion to reinstate, motion for new trial, or

direct appeal is available, it is hard to imagine any case in which failure to pursue one of them

would not be negligence.”). Further, a bill of review may not be used as an additional remedy

after one has made a timely but unsuccessful appeal. McIntyre v. Wilson, 50 S.W.3d 674, 679

(Tex. App.—Dallas 2001, pet. denied). We review the trial court’s denial of a bill of review

under an abuse of discretion standard. Morris, 2015 WL 1622184, at *2.

           Here, Wife’s motion to dismiss purported to be based on rule of civil procedure 91a. At

the outset, we address Husband’s contention in his first and second issues that the trial court

erred in granting Wife’s motion because rule 91a is not applicable in family law proceedings. 3

Rule 91a, which went into effect on March 1, 2013, provides for the dismissal of baseless causes

     3
        The trial judge orally granted the motion to dismiss. Its written order incorrectly stated, however, that “The motion should be denied.”
The order granted the relief Wife requested in her motion, dismissal of Husband’s bill of review, and thus accurately reflects the judgment
actually rendered.



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of action. Under the rule, a party may move to dismiss a cause of action on the grounds that it

has no basis in law or fact. TEX. R. CIV. P. 91a.1. A court may not consider evidence in ruling

on such a motion and must decide the motion based solely on the pleading of the cause of action.

Id. 91a.6. A party may not move to dismiss a case brought under the family code on rule 91a

grounds. Id. 91a.1.

       An ordinary motion to dismiss is an appropriate vehicle by which to attack a bill of

review. See, e.g., Bevering v. Bevering ex rel. Bevering, 401 S.W.3d 293, 296 (Tex. App.—San

Antonio 2013, pet. denied) (defendant filed motion to dismiss bill of review on grounds

petitioner did not present prima facie proof of bill-of-review requirements). Although Wife’s

motion mentioned rule 91a and asserted as one basis for dismissal that Husband’s action had no

basis in law or fact, on whole, the substance of the motion addressed whether Husband met the

pleading and proof requirements for his bill of review. As stated above, she asserted that

Husband failed to plead a meritorious defense, failed to establish extrinsic fraud, and failed to

establish he was not negligent or at fault.

       At the hearing, there was some discussion of the applicability of rule 91a. The trial court

indicated it thought the rule applied because a petition for bill of review was a new civil lawsuit.

Yet it is clear the court ultimately did not treat the motion to dismiss as a rule 91a motion. Both

the written order and the judge’s comments at the hearing on the motion to dismiss indicate the

reason the motion was granted was because the judge concluded Husband was not entitled to

pursue a bill of review because he dismissed his appeal of the divorce decree. The court

therefore did not decide Wife’s motion to dismiss based solely on Husband’s pleadings, as rule

91a mandates. See TEX. R. CIV. P. 91a.6. Further, the trial court did not award Wife her costs

and attorney’s fees, as rule 91a requires. See id. 91a.7. In summary, a motion to dismiss can be

used to attack a bill of review; Wife’s motion to dismiss challenged whether Husband met the

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substantive requirements for bill-of-review relief, and the trial court did not treat the motion as a

rule 91a motion. Under these circumstances, we do not find it necessary to the disposition of this

appeal to consider whether a rule 91a motion to dismiss can be used to attack a bill of review

when the underlying judgment is a divorce decree, and we express no opinion on the subject.

We overrule Husband’s first and second issues.

       We turn to Husband’s third issue in which he contends that, if rule 91a applies, his bill of

review does not lack basis in law or fact. He argues his petition did not lack basis in law or fact

because he established a meritorious defense or ground for appeal – that the property division

would have been different but for Wife’s fraudulent concealment of assets. Because we have

concluded the trial court did not decide Wife’s motion on rule 91a grounds, this issue lacks

merit. Further, there is nothing in the record to indicate the trial court considered whether

Husband proved a prima facie case of a meritorious defense or ground for appeal. The trial court

ruled in Wife’s favor on the basis of the third bill-of-review element, lack of fault or negligence.

In this appeal, Husband never asserts the trial court erred in determining that he failed to exercise

due diligence in pursuing all legal remedies against the judgment. He thus has not challenged

the actual basis for the trial court’s order. We overrule Husband’s third issue.

       We affirm the trial court’s order dismissing the bill of review.




                                                      /Ada Brown/
                                                      ADA BROWN
                                                      JUSTICE

140609F.P05




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                                        S
                               Court of Appeals
                        Fifth District of Texas at Dallas
                                      JUDGMENT

STEPHEN AARON BERGENHOLTZ,                            On Appeal from the 366th Judicial District
Appellant                                             Court, Collin County, Texas
                                                      Trial Court Cause No. 366-00117-2014.
No. 05-14-00609-CV         V.                         Opinion delivered by Justice Brown. Chief
                                                      Justice Wright and Justice Stoddart
JOSEPHINE DONNA ESKENAZI,                             participating.
Appellee

       In accordance with this Court’s opinion of this date, we AFFIRM the trial court’s April
14, 2014 order dismissing the bill of review.

        It is ORDERED that appellee JOSEPHINE DONNA ESKENAZI recover her costs of
this appeal from appellant STEPHEN AARON BERGENHOLTZ.


Judgment entered this 23rd day of July, 2015.




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