Daniel A. Morales v. Stephen S. Durish, Individually and as Receiver for Carrier's Insurance Company

IN THE COURT OF APPEALS, THIRD DISTRICT OF TEXAS, AT AUSTIN NO. 3-91-536-CV DANIEL A. MORALES, APPELLANT vs. STEPHEN S. DURISH, INDIVIDUALLY, AND AS RECEIVER FOR CARRIER'S INSURANCE COMPANY, T. COLEMAN EXPRESS AND JAMES ALLEN JENSEN, APPELLEES FROM THE DISTRICT COURT OF TRAVIS COUNTY, 201ST JUDICIAL DISTRICT NO. 466,425, HONORABLE JOHN K. DIETZ, JUDGE PER CURIAM This cause is before us on a petition for writ of error. Tex. R. App. P. Ann. 45 (Pamph. 1992). Appellant Daniel Morales seeks review of an order dismissing with prejudice his cause of action for want of prosecution. We will reform the district court's order, and, as reformed, affirm the order. BACKGROUND Daniel Morales was involved in an automobile collision on September 5, 1985. James Allen Jensen drove the truck that struck Morales' vehicle. On the date of the accident, Jensen's employer was T. Coleman Express, a corporation. Coleman's insurer was Carrier's Insurance Company (Carrier's). Morales filed a claim with Carrier's for his injuries and damages, and subsequently filed two proofs of claim against Carrier's in receivership. On July 8, 1987, having received no response from the ancillary receiver, Morales filed a lawsuit in Hale County to stop the statute of limitations from running on his claim. Subsequently, the district court of Travis County appointed Stephen S. Durish receiver in Carrier's delinquency proceeding in that court. On June 13, 1989, Durish's office notified Morales that it had rejected 95% of his claim. Morales filed suit in the district court of Travis County asking that court to set aside the receiver's rejection of his claim. Tex. Ins. Code Ann. art. 21.28, § (3)(h) (Supp. 1992). (1) On April, 4, 1991, Eugene A. Brodhead, successor in interest to Stephen S. Durish in his capacity as ancillary receiver for Carrier's, filed a motion to dismiss Morales' suit for want of prosecution pursuant to Tex. R. Civ. P. Ann. 165a(2) (Supp. 1992). On May 1, 1991, the trial court granted the motion and ordered the cause dismissed with prejudice. Morales seeks review of the trial court's order by petition for writ of error. (2) DISCUSSION The elements for review by petition for writ of error are: (1) the petition must be brought within six months of the date of judgment; (2) by a party to the suit; (3) who did not participate in the trial; and (4) error must be apparent from the face of the record. Tex. Civ. Prac. & Rem. Code Ann. § 51.012, .013 (1986); Tex. R. App. P. Ann. 45 (Pamph. 1992); DSC Finance Corp. v. Moffitt, 815 S.W.2d 551, 551 (Tex. 1991). The record in this case shows that the first three elements have been met. We turn to the fourth element. In a single point of error, Morales asserts that the trial court committed fundamental error when it dismissed his cause of action for want of prosecution with prejudice. The order reflects that the dismissal for want of prosecution is with prejudice. Although the receiver concedes the dismissal with prejudice is erroneous, he argues that the inclusion of the phrase "with prejudice" does not harm Morales' legal rights in any way. We disagree. A dismissal for want of prosecution is neither an adjudication on the merits, nor a bar to refiling the case. Rizk v. Mayad, 603 S.W.2d 773, 775 (Tex. 1980); Melton v. Ryander, 727 S.W.2d 299, 303 (Tex. App. 1987, writ ref'd n.r.e.). The order of dismissal places the parties in the position they were in before the filing of the suit. Crofts v. Court of Civil Appeals, 362 S.W.2d 101, 104 (Tex. 1962, orig. proceeding); Collins v. Flatte, 614 S.W.2d 580, 582 (Tex. Civ. App. 1981, no writ). The inclusion of the phrase "with prejudice" does not place the parties in the same position they were before the filing of the suit because it is an adjudication on the merits, and it bars Morales from refiling his cause. Collins, 614 S.W.2d at 582. For the reasons stated, the error complained of is not harmless. Morales argues that the error is fundamental, citing Melton, Maldonado v. Puente, 694 S.W.2d 86, 92 (Tex. App. 1985, no writ), and Collins. In his brief, Morales prays that we reverse the trial court's order and remand the cause to the trial court for reinstatement. The cases Morales relies on do not hold that dismissal for want of prosecution with prejudice is fundamental error. Fundamental error survives today in those rare instances in which the record shows the court lacked subject matter jurisdiction or that the public interest is directly and adversely affected as that interest is declared in the statutes or the Constitution of Texas. Pirtle v. Gregory, 629 S.W.2d 919, 920 (Tex. 1982). While there is error apparent on the face of the record it is not fundamental. The trial court had the power to dismiss a cause for want of prosecution (3) and the trial court did not err in doing so. The trial court exceeded its jurisdiction only to the extent that it dismissed the cause with prejudice. The appropriate remedy here is not reinstatement, but reformation of the judgment. Melton, 727 S.W.2d at 303; Collins, 614 S.W.2d at 582. We therefore reform the judgment to strike the words "with prejudice." We grant appellant's point of error on the limited basis that inclusion of the phrase "with prejudice" is erroneous. The order of dismissal is reformed to delete the words "with prejudice" and, as reformed, affirmed. [Before Justices Powers, Jones and Kidd] Reformed and, as Reformed, Affirmed Filed: August 26, 1992 [Do Not Publish] 1. 1 Section 3(h) requires a claimant who desires to bring an action challenging the receiver's rejection of his claim to do so in the court in which the delinquency proceeding is pending within three months after the claimant receives notice that the receiver rejected all or part of his claim. Otherwise the action of the receiver shall be final and not subject to review. The action must be filed separate from the delinquency proceeding. Tex. Ins. Code Ann. art. 21.28, § 3(h) (Supp. 1992). 2. 2 Morales did not file a motion to reinstate in the trial court. Tex. R. Civ. P. Ann. 165a(3) (Supp. 1992). This does not preclude our consideration of his complaint if he satisfies the requirements for review by petition for writ of error. See Tex. R. Civ. P. Ann. 165a(4) (Supp. 1992) (Rule 165a dismissal and reinstatement procedure is cumulative of rules and laws governing any other procedures available to the parties). 3. 3 Tex. R. Civ. P. Ann. 165a(2) (Supp. 1992).