John A. Lance, Debra L. Lance, F.D. Franks and Helen Franks v. Judith and Terry Robinson, Gary and Brenda Fest, Virginia Gray and Butch Townsend

ACCEPTED 04-14-00758-CV FOURTH COURT OF APPEALS SAN ANTONIO, TEXAS 7/8/2015 10:55:18 AM KEITH HOTTLE CLERK

NO. 04-14-00758-CV

IN THE COURT OF APPEALS FILED IN FOURTH COURT OF APPEALS DISTRICT OF 4th COURT OF APPEALS TEXAS SAN ANTONIO, TEXAS SAN ANTONIO, TEXAS 7/8/2015 10:55:18 AM KEITH E. HOTTLE Clerk JOHN A. LANCE, DEBRA L. LANCE, F.D. FRANKS AND HELEN FRANKS APPELLANTS v. JUDITH AND TERRY ROBINSON, GARY AND BRENDA FEST, VIRGINIA GRAY, BUTCH TOWNSEND AND BEXAR-MEDINA-ATASCOSA COUNTIES WATER CONTROL AND IMPROVEMENT DISTRICT NO. 1 APPELLEES

From the 198th District Court ofBandera County, Texas Trial Court No. CV-12-0100209 Honorable 1Vl. Rex Emerson, Judge Presiding

BRIEF OF APPELLEE BEXAR-IVIEDINA-ATASCOSA COUNTIES \VATER CONTROL & IMPROVEMENT DISTRICT No. 1

GOSTOMSKI & HECKER, P.C. Edward T

BEXAR-MEDINA-ATASCOSA COUNTIES WATER CONTROL IMPROVEMENT DISTRICT l

TABLE OF CONTENTS

TABLE OF CONTENTS ........................................................................................... i INDEX OF AUTHORITIES.......... . ..... . ................................... 11 STATEMENT OF THE CASE ................................................................................ iii ISSUES PRESENTED ............................................................................................. iii

1. The trial court did not err by granting summary, declaratory judgment under Chapter 37 of the Texas Civil Practice & Remedies Code, and the judgment must be aftirrned ............................................................................................................ iii 2. The trial court did not abuse its discretion by awarding attorney fees to the Bexar-1\tledina-Atascosa Counties Water Control & Improvement District No. 1, and sufficient evidence supported the amount of the award ................................. iii STATEMENT OF FACTS ....................................................................................... 1

SUMMARY OF THE ARGUMENT ....................................................................... 5 ARGUMENT ............................................................................................................ 6

1. The trial court did not err when it granted declaratory judgment concerning the Deed Without Warranty ................................................................................... 6 2. The trial court did not abuse its discretion by awarding attorney fees to the Bexar-Medina-Atascosa Counties Water Control & Improvement District No. 1 7 were ............. 9 B. .... 14

INDEX OF AUTHORITIES

Cases Amaro v. J!Vilson County, 398 S.W.3d 780 (Tex.App.-San Antonio 2011, no pet) 8, 14 Arthur Anderson & Co. v. Perry Equipment Corp., 945 S.W.2d 812 (Tex. 1997) .. 9 Bocquet v. Herring, 972 S.W.2d 19 (Tex. 1998) ...................................................... 9 City ofLaredo v. Buenrostro, 357 S.W.3d 118 (Tex.App.-San Antonio 2011, no pet.) ......................................................................................................................... 9 Nobles v. Jvtarcus, 533 S.W.2d 923 (Tex. 1976) ...................................................... 7 Oake v. Collin County, 692 S.W.2d 454 (Tex. 1985) ............................................... 9 R.R. Comm'n ofTex. v. Torch Operating Co., 912 S.W.2d 790 (Tex. 1995) ........... 9 Tony Gullo A1otors I, L.P. v. Chapa, 212 S.W.3d 299 (Tex. 2007) ....................... 13 Wells Fargo Bank, N.A. v. O'Brien, 458 S.W.3d 912 (Tex. 2015) .................... 8, 14 Statutes Tex. Civ. Prac. & Rem. Code§ 37.004(a) ................................................................ 6 Tex. Civ. Prac. & Rem. Code§ 37.009 .................................................................... 8 Tex. Disc. R. Prof. Conduct 1.04 ............................................................................ 10 Rules Tex. R. App. P. 38.2(a)(l)(B) ............................................................................................ iii Tex. R. App. P. 9.4 ............................................................................................................ 18 Tex. R. Civ. P. 37 ............................................................................................................... iii Tex. R. Civ. P. 39 ............................................................................................................... iii R. . P. 60 ..... .......... .. .. m

STATEMENT OF THE CASE

The Appellees are satisfied with the Appellants' statement of the case, except for its omission of Bexar-Medina-Atascosa Counties Water Control & Improvement District No. 1's intervention as an indispensable party. Tex. R. App. P. 38.2(a)(l)(B); see Tex. R. Civ. P. 37, 39(a)(2), 60.

ISSUES PRESENTED

1. The trial court did not err by granting summary, declaratory judgment under Chapter 37 of the Texas Civil Practice & Remedies Code, and the judgment must be affirmed.

2. The trial court did not abuse its discretion by awarding attorney fees to the Bexar-Medina-Atascosa Counties Water Control & Improvement District No. 1, and sufficient evidence supported the amount of the award.

STATEMENT OF FACTS

F.D. and Helen Franks owned property adjacent to Medina Lake. They sold the property to John and Debra L. Lance. 1 The Franks also created a Deed Without Warranty (DWW) to 0.282 acres of property they did not own and conveyed it to the Lances. The DW\V property extends downslope from the Lance's property toward the Medina Lake pool. The Lances began to take measures to exclude other persons from the property described by the DWW.

There is no record evidence of any chain of title passing the property described in the DWW to F.D. and Helen Franks. The Franks simply created the DWW out of thin air, as set forth in greater detail in the Brief filed by Appellees Judith and Terry Robinson, Gary and Brenda Fest, Virginia Gray and Butch Townsend (the Robinson Appellees).

The Bexar-Medina-Atascosa Counties Water Control & Improvement District No. 1 (BMA) has historically and consistently asserted an ownership

Medina

are as may be used by the persons, like the Lances and the Robinson Appellees, who own lake property above the 1084' elevation.

The DW\V describes land in which the BNIA asserts an ownership interest Although the BMA contends it is the fee owner of the property in question, that matter was not part of the trial court's judgment and is not before this court on appeal.

The Robinson Appellees sued the Appellants after the Lances took measures to exclude them from the DWW property. After BMA was identified as an mdispensable party, it mtervened in the lawsuit to seek declaration under Chapter 37 of the Texas Civil practice & Remedies Code. BMA asked the trial court to declare that the DWW did not convey any legal or equitable rights from the Franks to the Lances. 2

The issue of the made-up DWW was raised in a motion for partial summary judgment filed by the Robinson Appellees against the Appellants before BMA

motion was

(RR

to them repetitively and serial rehearings when they disagreed with the court's rulings.

The I 98th Judicial District Court, Bandera County, Texas, eventually heard the motion for partial summary judgment and granted it on June 11, 2014. The judgment declared that the DWW

from the Franks as grantors to the Lances as grantees (recoded in Volume 915, Page 86, of the Bandera! County real property records)("Deed Without Warranty"), purporting to convey the Franks' interest in a described .282-acre parcel of land ("disputed area") to the Lances, did not convey any ownership or other interest in the described property to the Lances.

(Appx. Tab A) The district court severed the partial summary judgment from the remaining issues on June 12, 2014. (Appx. Tab D)

On September 5, 2014, BMA moved for its attorney fees and for entry of final judgment on the severed claims. (CR 5-11) The court heard BMA's motion on September 17, 2014.

The the on attorney established that BMA incuiTed over In (RR 1)

(RR or

BMA who are

""'~'"'"" as attorneys, to handle certain tasks the supervision of the firm's attorneys. (RR 68-69, 74) These persons' services were billed at a rate of $75 per hour. All of the firm's time was billed in tenth-of-an-hour increments, and all of the firm's activities were itemized and described in detail in the billing records introduced in evidence at the attorney fee hearing. (RR 72, Exh.

I-1)

The uncontroverted testimony before the court conclusively established that BMA's counsel economized legal services as much as possible. BMA's legal expenses were minimized by assigning certain tasks to law clerks and paralegals at a lower hourly rate than those services would have been charged to BMA had the firm's attorneys done them. (RR 65-66, 68-69, 72-73) Similarly, the Robinson Appellees had already filed a motion for partial summary judgment on the declaratory before court, so BMA's counsel chose not to amplify legal

a same (RR BMA's declaratory judgment claim, Bl\1A's attorney fees totaled 1,025.00. (RR 78)

The district court entered final judgment on the severed claims. (Appx. Tab E) It awarded BMA $31,025.00 in attorney fees, plus attorney fees in the amount of $10,000.00 should BMA prevail on appeal, and an additional $5,000.00 should the Texas Supreme Court request a response from BMA concerning any petition for review Appellants might file in that forum. (!d.) Appellants noticed this appeal.

SUMMARY OF THE ARGUMENT

The trial court's declaratory judgment should be affirmed. The trial court correctly declared that Appellants' Deed Without Warranty conveyed no ownership in real property from the Franks to the Lances. The deed purported to describe and convey, without warranty, property in which BMA claimed an interest. There was nothing, other than the conjured deed, in the Appellants' title

BMA it demanded substantial attorney time and labor. Counsel, a seasoned litigator who has represented the BMA for a decade-and-a-half, actively participated in the case and billed his time at a rate at or below the reasonable rate for similar services in the trial court venue. Counsel's time expenditures were conservative rather than exaggerated, and he employed cost-saving measures, such as tasking supervised non-lawyers for certain activities. BMA only sought fees for services that advanced its declaratory claims, and the resulting judgment favored BMA.

The trial court did not abuse its discretion by determining that BMA' s fees were equitable and just and deciding to award them against Appellants. Fee-shifting was justified by the positions taken by and conduct of the Appellants during the litigation. But most importantly, the attorney fee award was equitable and just because the entire case was made necessary by Appellants' questionable decision to prepare and transfer a deed to property they did not own, and then dig in and fight.

ARGUMENT

1. The trial court did not err when it granted declaratory judgment concerning the Deed \Vithout \Varranty

under a deed or 37.004(a). Bl\1A had in interest in the D\VW because the fabricated document conflicted with BMA's ownership claims to the property. Most of Appellants' brief concerns whether the BMA or any of the other Appellees has title to the property in question. 3 But the trial court's judgment did not determine or declare who has title to the property. The Appellees did not seek that relief. Instead, the trial court judgment declared that the DWW conveyed no ownership in real property from the Franks to the Lances. For the reasons set forth in the Robinson Appellees' brief on the merits, which BMA adopts and incorporates, the declaratory judgment concerning the DWW should be affirmed.

2. The trial court did not abuse its discretion by awarding attorney fees to the Bexar-Medina-Atascosa Counties Water Control & Improvement District No. 1

The Appellants argue that unnecessary fees can never be reasonable, and the only fees necessary to the trial court's judgment involved drafting the motion for summary judgment and preparing for a temporary injunction hearing early in the case. They argue that the case was simple and should not have required as much effort as BNIA's counsel expended. They argue that BN1A freely chose to participate in the litigation; since Appellants did not bring BMA into the case, they don't think they should be responsible for BMA's legal fees. And they argue the attorney fee award to BMA is unjust and inequitable because BMA did not draft the motion for summary judgment and has not yet secured any relief. None of the Appellants' arguments has merit.

In a declaratory judgment action, the trial court, in its discretion, "may award costs and reasonable and necessary attorney's fees as are equitable and just." Tex. Civ. Prac. & Rem. Code § 37.009. The trial court's discretion extends so far as to support an award of attorney fees to a non-prevailing party, if the award is equitable and just. Wells Fargo Bank, NA. v. O'Brien, 458 S.W.3d 912, 916 (Tex. 2015); Amaro v. Wilson County, 398 S.W.3d 780, 789 (Tex.App.-San Antonio 2011 no pet).

Declaratory Judgments IS

s rna

s action must be affirmed absent a clear showing that the court abused its discretion. Bocquet v. Herring, 972 S.\V.2d 19, 21 (Tex. 1998); Oake v. Collin County, 692 S.W.2d 454, 455 (Tex. 1985). Whether fees are equitable and just are matters of law and reviewed de novo. Bocquet, 972 S. W.2d at 21.

A. BMA 's attorney fees were reasonable and necessary

Attorney fees awarded under the Declaratory Judgments Act must be reasonable and necessary, a fact question. Bocquet, 972 S.W.2d at 21. Under the substantial evidence standard of review, an attorney fee award will not be disturbed if "more than a mere scintilla" of evidence supports the reasonableness of the award. R.R. Comm'n of Tex. v. Torch Operating Co., 912 S.W.2d 790, 792-93 (Tex. 1995); City of Laredo v. Buenrostro, 357 S.W.3d 118, 122 (Tex.App.-San Antonio 2011, no pet.) (Discussing substantial evidence review). Without more than a scintilla of evidence of the reasonableness and necessity of the attorney fees, a court abuses its discretion if it awards them. See Bocquet, 972 S.W.2d at 21.

BMA's were reasonable and necessary. Reasonableness is

m

mclude:

( l) the time and labor required, the novelty artd difficulty of the questions involved, and the skill required to perform the legal service properly; (2) the likelihood ... that the acceptance of the particular employment will preclude other employment by the lawyer; (3) the fee customarily charged in the locality for similar legal services; (4) the amount involved and the results obtained; (5) the time limitations imposed by the client or by the circumstances; (6) the nature and length of the professional relationship with the client; (7) the experience, reputation, and ability of the lawyer or lawyers performing the services; and (8) whether the fee is fixed or contingent on results obtained or uncertainty of collection before the legal services have been rendered.

Arthur Anderson, 945 S.W.2d at 817, citing Tex. Disc. R. Prof. Conduct 1.04.

The roots of this cause may have been uncomplicated [RR 100-1 03 ], but it did not remain simple. The issues multiplied in intensity and complexity, and additional parties appeared and amplified the proceedings. The litigation demanded a substantial amount of attorney attention, time and labor. (RR 100-103, 122-23). Even Appellants' counsel testified at the attorney fee hearing that the case involved difficult issues and unforeseen complexities, and that it takes time lawyers Her testimony that her own

were BMA' SIZe

once. The

on the attorney fee hearing ~ including Appellants' counsel agreed that it is appropriate for an attorney to bill for the time it takes to prepare for hearings, including reading motions and reviewing the authorities cited in the motions and briefing, and understanding how the authorities apply to the facts in issue. (RR 74, 116, 124-25) The case went to mediation twice each time requiring counsel to devote time to preparation and attendance.

The testimony and evidence at the attorney fee hearing left little doubt that the Appellants' litigation tactics influenced the amount of BMA's attorney fees. Those tactics mcluded

the excessive briefing and rehearings that the [Appellants] engaged in this case. And if you look through the billing, you will see that there will be, you know, a 30, 40-page brief cited by opposing counsel. They will cite 40 or 50 cases in it. My law clerk has to pull all those cases, Shepardize the cases, make sure they're good law. There' is time billed for that. And I have to review the cases to see what is being argued here and what is the relevance to the case. . . . Three months later when we have a rehearing on that, we have to do it all over agam. It doesn't take quite as long, but I still have to review things.

(RR l1 should cause

s counsel was m m which the

11 0) that BMA's counsel devoted well over 200 hours~ more than a solid month of 40-hour work weeks ~ of billable time to the declaratory 1ssue alone. (RR 66, Exh I-1) The testimony heard by the trial court was sufficient evidence that BMA's counsel likely missed other professional opportunities because of the amount of time it took to prosecute BMA's interests in this cause.

It is true that BMA's counsel did not draft the motion for summary 5 judgment, as Appellants argue. Appellants' argument seems to suggest that BMA

should have drafted a separate motion for summary judgment and would have been justified in recovering attorney fees for doing so. They may be right, but it is clear that BMA's decision not to duplicate efforts by researching and drafting a separate, redundant motion benefitted the Appellants by reducing the attorney fees awarded against them. 6

BMA's choice not to pursue a litigation strategy that would have resulted in a larger attorney fee award against the Appellants does not support the denial of

BMA's not bill drafting fees to BMA altogether, as the Appellants argue. And regardless who drafted the motion for partial summary judgment, BMA's counsel was responsible for reading the motion, responses, replies, supplements, and briefs. BMA's counsel had to read, apply and/or distinguish the authorities cited in those instruments, prepare for the hearing, argue at the hearing and argue it all over again when the Appellants moved for rehearing or demanded a new trial. (RR 85, 88-89, Appx. Tab F) Since BMA's counsel did not draft Appellants' response and briefing in opposition to the motion for partial summary judgment either, should fees for reading and analyzing those instruments be excluded, too? If BMA had sought or recovered attorney fees for drafting a motion it did not write, authorship might matter. But the trial court awarded fees for what was done, not what wasn't done.

Appellants argue that attorney fees should only be awarded for developing evidence for the temporary injunction hearing and drat1ing the motion for summary judgment, since those are the only activities that directly produced the judgment.

Is not supported Tony Gullo A:fotors I, L.P. v. Chapa, 212 S.W.3d 299, 314 (Tex. 2007). The record shows that Appellants cluttered the path to relief in this case with a lot of obstacles. They cannot, then, argue that it was unnecessary and unreasonable for BMA to incur legal costs to overcome them.

The evidence is sufficient to show that the attorney fees awarded to BMA were reasonable and necessary under every one of the Rule 1.04/Anderson factors relevant to this cause.

B. The attorney fee award to BMA is equitable and just

Appellants argue that the attorney fees awarded to BMA are unjust and inequitable. They argue that the Appellants did not sue BMA or cause it to be a party to the litigation, so they should not be responsible for BMA's fees. Under that argument, however, a defendant would rarely be subject a fee-shifting judgment because defendants usually don't invite potential plaintiffs to sue them.

In a related argument, Appellants also claim that the attorney fee award was

in the trial D\VvV and asked for attorney fees under the Declaratory Judgments Act The case proceeded to disposition, where the trial court granted judgment awarding the declaratory relief and attorney fees BMA pleaded tor. Appellants' 'prevailing party' argument is not supported by Texas authorities concerning fee awards in declaratory judgment actions, but even if the law supported Appellants' theory, the record does not: BMA was a prevailing party.

Appellants contend that it's just not right to award BMA attorney fees when BMA did not draft the motion that resulted in the judgment That argument is addressed above, concerning the reasonableness and necessity of BMA's attorney fees. But even if Appellants' argument were credible, how would BMA be any different than a party who wins judgment after trial on the merits a party who obtained relief without drafting a motion for summary judgment or anything else other than perhaps a petition and a jury question?

On the Issue of equity and justness, Appellants' argument fails to address the

lll room: an If equity and justice ever warranted an upward adjustment to the lodestar, this is the case.

The attorney fee award to BMA was obviously equitable and just; therefore, the trial court did not abuse its discretion by deciding to award reasonable and necessary attorney fees to BMA in the amounts set forth in the Amended Award of Attorney Fees and Final Judgment. (Appx. Tab E)

PRAYER

BMA prays the judgment of the trial court will be affirmed.

Respectfully submitted,

Edward T. Hecker GOSTOMSKI & HECKER, P.C. State Bar No. 00787668 607 Urban Loop San Antonio, Texas 78204-3117 (21 0) 222-9529

ATTORNEY FOR APPELLEE, BEXAR-MEDINA-ATASCOSA

CERTIFICATE OF SERVICE

I certify this Brief has been served on the persons below through the court's mandatory e-filing system and via email on the 8th day of July, 2015.

Cynthia Cox Payne Texas Bar No. 24001935 1118 Main Street Bandera, Texas 78003 (830) 796-7030 - Phone (830) 796-7945 Fax cpayne@paynelawfinn.net

Dan Pozza State Bar No. 16224800 239 East Commerce Street San Antonio, Texas 78205 (21 0) 226-8888 Phone (210) 224-6373- Fax danpozza@yahoo.com

Stephan B. Rogers Ross S. Elliott Rogers & Moore 309 Water Street, Suite 114 Boerne, Texas 78006 Attorney for Plaintiffs srogerslaw@gmail.com

CERTIFICATE OF COJ\tiPLIANCE

By his signature, below, counsel for BMA certifies that this brief: 1) contains fewer than 4,000 words, excluding parts of the brief exempted by Tex. R. App. P. 9.4(i)( 1) , and therefore complies with the type-volume limitation ofTex. R. App. P. 9.4(i)(2)(D); and 2) complies with the typeface requirement of Tex. R. App. P. 9.4(e) because it was prepared in a conventional, 14-point font typeface in the text and footnotes.

Edward T. Hecker