Wendell Watson v. Allstate Indemnity Company, American General Fire & Casualty Company AKA Maryland Casualty Company, Covey & Moorehead Adjusters Incorporated, Preston Harvey Construction, State Farm Insurance Company, United States Fidelity & Guaranty Company

TEXAS COURT OF APPEALS, THIRD DISTRICT, AT AUSTIN NO. 03-93-00418-CV Wendell Watson, Appellant v. Allstate Indemnity Company, American General Fire & Casualty Company aka Maryland Casualty Company, Covey & Moorehead Adjusters Incorporated, Preston Harvey Construction, State Farm Insurance Company, United States Fidelity & Guaranty Company, E. & W. Enterprises, J. B. Phillips Construction, and Key Service Group, Appellees FROM THE DISTRICT COURT OF TRAVIS COUNTY, 250TH JUDICIAL DISTRICT NO. 494,180, HONORABLE JOSEPH H. HART, JUDGE PRESIDING PER CURIAM Appellant Wendell Watson appeals from an order of the district court of Travis County dismissing his petition for equitable bill of review. In conjunction with the petition, Watson filed an affidavit of inability to pay the costs of suit. Tex. R. Civ. P. 145. Appellees filed their motions to dismiss on the basis that the allegations in Watson's affidavit were false, that the suit was frivolous or malicious and that Watson did not assert a meritorious defense to the underlying order of dismissal. The trial court granted the motion and dismissed the cause. We will affirm the trial court judgment. In 1987, Watson sued numerous insurance companies, including appellees, (1) for violations of the Texas Free Enterprise and Antitrust Act of 1983, Tex. Bus. & Com. Code Ann. § 15.05(a) (West 1987) (the "antitrust suit"), and filed an affidavit of inability to pay the costs of the suit pursuant to Texas Rule of Civil Procedure 145. On the motions of several defendants, the trial court ordered Watson to post security for costs in the amount of $2500. See Tex. R. Civ. P. 143, 145(1). When Watson did not, the trial court dismissed the suit. Tex. R. Civ. P. 143. This Court dismissed both the petition for writ of error and appeal from that order. Watson v. American Gen. Fire & Casualty Co., No. 3-88-174-CV (Tex. App.--Austin Sept. 14, 1988, writ denied), cert. denied, 493 U.S. 864 (1989) (not designated for publication); Watson v. American Gen. Fire & Casualty Co., No. 3-88-082-CV (Tex. App.--Austin May 25, 1988, no writ) (not designated for publication). Watson then filed his equitable petition for bill of review seeking to set aside the trial court's order of dismissal. Watson again filed an affidavit of inability to pay costs pursuant to Rule 145. Allstate Indemnity Company and Allstate Insurance Company (2) sought dismissal of the bill of review on the bases that Watson's allegation of poverty was false and that the action was frivolous or malicious. The trial court dismissed the petition for bill of review on the motion. This order underlies the appeal now before this Court. In his first point of error, Watson contends that the trial court abused its discretion in dismissing the petition on the basis that his action was frivolous or malicious. A trial court may dismiss an action in which a plaintiff has filed an affidavit of inability to pay costs if the court finds that the action is frivolous or malicious. Tex. Civ. Prac. & Rem. Code Ann. § 13.001(a)(2) (West Supp. 1995); (3) Johnson v. Peterson, 799 S.W.2d 345, 346 (Tex. App.--Houston [14th Dist.] 1990, no writ). In determining whether the action is frivolous or malicious, the court determines whether the claim has an arguable basis in law or fact. Tex. Civ. Prac. & Rem. Code Ann. § 13.001(b)(2) (West Supp. 1995); Johnson v. Lynaugh, 800 S.W.2d 936, 938 (Tex. App.--Houston [14th Dist.] 1990, writ denied). Watson suggests that the courts should apply section 13.001 only to suits filed by prisoners. However, the statute applies to any action in which a party has filed an affidavit of inability to pay costs pursuant to Rule 145. The rule applies to any party who is unable to afford costs, "defined as a person who is presently receiving a governmental entitlement based on indigency or any other person who has no ability to pay costs." Tex. R. Civ. P. 145. The rule allows access to the courts without payment of costs. Spellmon v. Sweeney, 819 S.W.2d 206, 208 (Tex. App.--Waco 1991, no writ). In enacting section 13.001, the legislature determined that a party does not have an absolute right to such access in a civil proceeding. Rather, access without payment of costs is a privilege extended to those who file actions that are not frivolous or malicious. Id., at 208-09. Accordingly, section 13.001 prevents indigent litigants who have no financial incentive to refrain from filing suit from filing an abusive lawsuit. Birdo v. Schwartzer, 883 S.W.2d 386, 387 (Tex. App.--Waco 1994, no writ); see Neitzke v. Williams, 490 U.S. 319, 327 (1989) (purpose of federal counterpart, 28 U.S.C. § 1918(d), is to discourage filing of, and waste of judicial and private resources upon, baseless lawsuits that paying litigant generally does not begin because of expense and threat of sanctions). The state's interest in conserving judicial resources by disposition of meritless claims early in a proceeding outweighs the indigent litigant's right to expend the state's resources. Spellmon, 819 S.W.2d at 210. We review the trial court's decision pursuant to section 13.001 for abuse of discretion. Dillon v. Ousley, 890 S.W.2d 500, 501 (Tex. App.--Corpus Christi 1994, no writ). In determining whether the trial court abused its discretion, we determine whether the trial court acted without reference to any guiding principles or whether the action was arbitrary or unreasonable. Metropolitan Life Ins. Co. v. Syntek Fin. Co., 881 S.W.2d 319, 321 (Tex. 1994); Downer v. Aquamarine Operators, Inc., 701 S.W.2d 238, 242 (Tex. 1985), cert. denied, 476 U.S. 1159 (1986). That this Court might decide a matter differently does not show that the trial court abused its discretion. Southwestern Bell Tel. Co. v. Johnson, 389 S.W.2d 645, 648 (Tex. 1965). The trial court dismissed Watson's bill of review proceeding brought to set aside the prior order of dismissal. See Tex. R. Civ. P. 329b(f); Baker v. Goldsmith, 582 S.W.2d 404, 406 (Tex. 1979); Cherry v. Altman, 872 S.W.2d 46, 47 (Tex. App.--Fort Worth 1994, writ denied). In a bill of review proceeding, the trial court may award relief only for sufficient cause. Tex. R. Civ. P. 329b(f); French v. Brown, 424 S.W.2d 893, 895 (Tex. 1967). To succeed upon his bill of review, Watson had to allege and prove: (1) a meritorious defense to the claim alleged to support the judgment, that is, the dismissal of the antitrust suit, (2) which he was prevented from making by fraud, accident or wrongful act of appellees, (3) unmixed with any fault or negligence of his own. Baker, 582 S.W.2d at 406-07; Cherry, 872 S.W.2d at 47. Accordingly, Watson asserted that he was unable to comply with the order to post security of $2500 and was unable to present this defense because of appellees' actions. He specifically alleged that he did not receive sufficient notice of the filing of appellees' joint motion to render an order of dismissal or of the signing of the order. After sustaining contests to Watson's affidavit of inability, the trial court ordered Watson to post security by November 12, 1987, twenty days after ordered to do so. See Tex. R. Civ. P. 143, 145(1). When Watson did not, the defendants filed a motion to render a judgment of dismissal on January 19, 1988, and asked that the trial court hear the motion with the contests to Watson's affidavit of inability to pay the costs of appeal on January 22. The trial court signed the order dismissing the cause, pursuant to Rule 143, on January 22. The trial court may have dismissed the suit any time after November 12 because Watson had not posted security for costs as ordered. Tex. R. Civ. P. 143; Clanton v. Clark, 639 S.W.2d 929, 931 (Tex. 1982). Although Watson was not present at the hearing on January 22, (4) he was on notice that the suit was subject to dismissal. Furthermore, the trial court had already sustained the contests to Watson's Rule 145 affidavit and determined that he could pay trial court costs. The fact that an injustice may have occurred is not sufficient cause to justify relief by petition for bill of review. Alexander v. Hagedorn, 226 S.W.2d 996, 998 (Tex. 1950); Hesser v. Hesser, 842 S.w.2d 759, 765 (Tex. App.--Houston [1st Dist.] 1992, writ denied). Relief by equitable bill of review is available only if a party has exercised due diligence to pursue all adequate legal remedies against a previous judgment and, through no fault of his own, no adequate legal remedy was available. Freeman v. City of Pasadena, 767 S.W.2d 700, 702 (Tex. 1989); Hesser, 842 S.W.2d at 765. Construing Watson's petition for bill of review liberally, we cannot conclude that he set forth an arguable basis for relief by bill of review. Accordingly, we cannot say that the trial court abused its discretion in dismissing the suit pursuant to section 13.001 of the Civil Practice and Remedies Code and overrule Watson's first point of error. Because dismissal pursuant to section 13.001 supports the trial court judgment, we need not address points of error two through four. The judgment of the trial court is affirmed. Before Chief Justice Carroll, Justices Jones and Kidd Affirmed Filed: April 26, 1995 Do Not Publish 1. 1 Appellees are American General Fire & Casualty aka Maryland Casualty Company, Covey & Moorehead Adjusters Incorporated, Preston Harvey Construction, Allstate Indemnity Company, State Farm Insurance Company, United States Fidelity & Guaranty Company, E. & W. Enterprises, J. B. Phillips Construction and Key Service Group. 2. 2 Defendants Fire Insurance Exchange and Texas Farmers Insurance also filed a motion to dismiss pursuant to Tex. Civ. Prac. & Rem. Code Ann. § 13.001 and a supplemental motion to dismiss that urged, alternatively, that the bill of review be dismissed because Watson did not allege a meritorious defense. The supplemental motion also sought dismissal as to all parties on the grounds asserted. The statement of facts from the November 25, 1991, hearing suggests that these motions were the subject of the hearing. In May 1992, Watson and Fire Insurance Exchange and Texas Farmers Insurance filed an agreed motion to dismiss because they had settled their claims. The order of dismissal, signed April 9, 1993, refers only to the defendants' motions to dismiss. On appeal, the parties refer only to the motion that Allstate Indemnity and Allstate Insurance filed. 3. 3 Section 13.001 provides: (a) A court in which an affidavit of inability to pay under Rule 145 . . . has been filed may dismiss the action on a finding that: (1) the allegation of poverty in the affidavit is false; or (2) the action is frivolous or malicious. (b) In determining whether an action is frivolous or malicious, the court may consider whether: (1) the action's realistic chance of ultimate success is slight; (2) the claim has no arguable basis in law or in fact; or (3) it is clear that the party cannot prove a set of facts in support of the claim. . . . Tex. Civ. Prac. & Rem. Code Ann. § 13.001(a), (b) (West Supp. 1995). Dismissal of a claim under section 13.001(b)(3) is not appropriate. Johnson v. Lynaugh, 796 S.W.2d 705, 706 (Tex. 1990); Spellmon v. Sweeney, 819 S.W.2d 206, 208 (Tex. App.--Waco 1991, no writ); see Neitzke v. Williams, 490 U.S. 319 (1989) (in forma pauperis suit is not automatically frivolous because it fails to state a claim). 4. 4 Watson assumed that the trial court had continued the hearing on the motion to dismiss. However, the record suggests that the trial court continued only the hearing on the contests to his affidavit of inability to pay the costs of appeal.