Browne v. Ortiz
| Decision Date | 30 September 2022 |
| Docket Number | 08-20-00195-CV |
| Citation | 657 S.W.3d 704 |
| Parties | Pamela M. BROWNE, Appellant, v. Robert J. ORTIZ and Odette Thomas, Individually and as Partner of Ortiz Farms, Appellees. |
| Court | Texas Court of Appeals |
ATTORNEY FOR APPELLANT: Phillip C. Bowen, 5927 Gateway West Suite B, El Paso, TX 79925.
ATTORNEY FOR APPELLEE: Robert R. Feuille, ScottHulse PC, 201 East Main Dr., Ste. 1100, El Paso, TX 79901.
Before Rodriguez, C.J., Palafox, and Alley, JJ.
In this declaratory judgment action, Robert J. Ortiz (Ortiz) and Odette Thomas, individually (Thomas), and as partners of Ortiz Farms Partnership (Ortiz Farms), Appellees, sought to establish that any obligations owed to Pamela M. Browne (Browne), Appellant, under a post-divorce settlement agreement between Ortiz and Browne are time-barred. Among other things, Appellees argued in the trial court any claims Appellant has pursuant to the settlement agreement are barred by the statute of limitations. The trial court agreed with Appellee's position and found the claims and causes of action raised by Appellant are barred by the statute of limitations.
On appeal, Appellant argues the trial court erred in allowing Appellees to bring a declaratory judgment action, asserting Appellee's suit is barred by the statute of limitations. Further, Appellant maintains the source of funds due to her under the settlement agreement has not yet come into existence, so any cause of action she has under the settlement agreement has not yet accrued.
We conclude the trial court erred in its interpretation of the settlement agreement, causing it to incorrectly calculate the accrual date of the statute of limitations. We reverse and remand this matter to the trial court for further proceedings consistent with this opinion.
Pamela Browne and Robert Ortiz divorced in July 1997. In 2005, Browne sued Ortiz; Ortiz Farms, the family partnership; and Odette Thomas, Ortiz's sister, in her capacity as estate representative of the Ortiz's father's and grandmother's estates, seeking to collect certain monies Browne believed she was due under the divorce decree.
Members of the Ortiz Farms partnership over the years have included Ortiz's and Thomas's grandmother, their father, their father's two wives, and the seven siblings that include Ortiz and Thomas. Partners’ interests have increased and decreased over the years as the older generations of the family have passed and have gifted shares to the younger generations.
In 2005, Ortiz's interest in the partnership was 11.425%. The partnership owned two assets, an El Paso farm property and a Pecos mineral interest, which was common knowledge in the family.
The parties to the 2005 lawsuit settled by entering into an agreement effective December 17, 2005 (the Settlement Agreement). Pursuant to the Settlement Agreement, Browne was to receive payment of $70,000 and subsequently deliver a release of judgment lien and a mutual release to Ortiz.
1. Resolution of Collection Matter . BROWNE agrees that the payment of $70,000.00 (the "Resolution Payment"), In accordance with the terms herein, shall operate as the full and complete satisfaction of any and all claims of BROWNE under the Divorce Decree.
The source of the $70,000.00 payment was spelled out in the Settlement Agreement.
2. Source of Resolution Payment . ORTIZ is to receive, from Ortiz Farms, a Texas partnership ("Ortiz Farms"), a 4.681% interest (the "Resolution Payment Source") In Ortiz Farms, that owns a parcel of real property in El Paso County, Texas which consists of fifty-nine (59) acres more or less (the "Property"). So long as any portion of the Resolution Payment remains unpaid, ORTIZ shall direct and the remaining owners of Ortiz Farms acknowledge and agree that distributions, net of Federal income tax, from Ortiz Farms and which are associated with said 4.681% interest shall be paid directly to BROWNE until the full balance of the Resolution Payment plus interest, if applicable, Is paid in full. BROWNE acknowledges and agrees that she must deliver an acknowledgement of receipt for each payment received from the Resolution Payment Source, with such acknowledgement, the payment records of Ortiz Farms shall be conclusive evidence of such payment. Additionally, any payment received hereunder shall be deemed to be received upon the date that BROWNE is notified that such payment is available pending her acknowledgement of payment. Until the Resolution Payment and applicable interest is paid in full to BROWNE, ORTIZ shall only receive so much of the income from Resolution Payment Source, to permit ORTIZ to pay in full his Federal income tax associated with the earnings from the Resolution Payment Source.
In 2006 and 2007, Ortiz received distributions from Ortiz Farms in the amounts of approximately $1,500 and $1,833, respectively. From 2008 through 2017, Ortiz did not receive any distributions from Ortiz Farms. In 2018, Ortiz Farms sold the Pecos mineral interests, and as a result, Ortiz was due a partnership distribution. Because Thomas was unsure whether any of the distribution due to Ortiz should be paid to Browne, she withheld Ortiz's 2018 partnership distribution. Appellees then filed a declaratory judgment action seeking declaration that no funds were due and owing to Appellant because, among other reasons, they were barred by the statute of limitations. Ortiz argued that the 2006 and 2007 distributions to him, with no payments made from those distributions to Appellant, constituted breaches of the Settlement Agreement, causing any claim by Appellant under the Settlement Agreement to accrue.1
After a bench trial, the trial court entered judgment that any claims Appellant had under the Settlement Agreement were barred by the statute of limitations. Shortly thereafter, the trial court entered Findings of Fact and Conclusions of Law. In its conclusions of law, the trial court stated that Appellant's claims and causes of action accrued in 2009 and expired in 2013.2
"We review declaratory judgments under the same standards as other judgments and look to the procedure used to resolve the issue in the trial court to determine the standard of review on appeal." Donias v. Old Am. Cnty. Mut. Fire Ins. Co. , 649 S.W.3d 789, 793 () (citing TEX.CIV.PRAC. & REM.CODE ANN. § 37.010 ).
Findings of fact entered after a bench trial are reviewed on appeal for legal and factual sufficiency of the evidence. Anderson v. City of Seven Points , 806 S.W.2d 791, 794 (Tex. 1991). Findings of fact "are not binding on a court of appeals where a complete reporter's record is part of the record on appeal[,]" Pearl Res. LLC v. Charger Servs., LLC , 622 S.W.3d 106, 115 (Tex.App.—El Paso 2020, pet. denied), and "if the contrary is established as a matter of law or if there is no evidence to support the findings." Ramsey v. Davis , 261 S.W.3d 811, 815 (Tex.App.—Dallas 2008, pet. denied). "A court's conclusions of law are reviewed de novo as legal questions." Pearl Res. , 622 S.W.3d at 115.
"The trial court abuses its discretion when it fails to properly apply the law to the undisputed facts, when it acts arbitrarily or unreasonably, or when it bases its ruling on factual assertions unsupported by the record." Chromalloy Gas Turbine Corp. v. United Tech. Corp. , 9 S.W.3d 324, 328 (Tex.App.—San Antonio 1999, pet. denied) (citing Remington Arms Co., Inc. v. Luna , 966 S.W.2d 641, 643 (Tex.App.—San Antonio 1998, pet. denied) ).
In Issues One, Two, and Three, Appellant argues that Appellees’ declaratory judgment cause of action was barred by the four-year statute of limitations. In Issues Four and Five, Appellant disputes Settlement Agreement funds for payment had yet to materialize, therefore, the statute of limitations has not begun to run. In Issue Six, Appellant questions whether Ortiz's failure to make payments from 2009 until 2013 gave rise to a cause of action. In Issue Seven, Appellant contends that her claims under the Settlement Agreement were preserved because they were timely filed as a counterclaim. Finally, in Issue Eight, Appellant urges that the evidence at trial was legally insufficient to support the trial court's judgment. The threshold issue is whether Browne's causes of action under the Settlement Agreement are barred by the statute of limitations. We hold they are not.
Statute of Limitations as to Appellees’ claim
For the first time on appeal, Appellant asserts Appellees’ declaratory judgment action is barred by the statute of limitations. Limitations is an affirmative defense that if not pled, is waived. Izen v. Laine , 614 S.W.3d 775, 796 (Tex.App.—Houston [14th Dist.] 2020, pet. denied) ; see Zorrilla v. Aypco Constr. II, LLC , 469 S.W.3d 143, 155 (Tex. 2015). Appellant has waived this argument because she did not raise the issue of limitations before the trial court.
Moreover, it is inappropriate to raise limitations as a bar to bringing a declaratory judgment action seeking declaration that limitations bars a claim. Appellees’ declaratory judgment action sought a judgment that the defense of limitations barred any claims Appellant may have had under the Settlement Agreement. A request for a declaration that limitations bar a claim is not a request for affirmative relief. "As a general rule," and as in this case, "limitations statutes do not apply to defenses." Villages of Greenbriar v. Torres , 874 S.W.2d 259, 266 (Tex.App.—Houston [1st Dist.] 1994, writ denied). "If the subject-matter of the contention is intrinsically defensive in nature and would, if given effect, operate merely to negate the plaintiff[’]s asserted right to recover, the statute of limitations does not apply." Tamimi Global Co. v. Kellogg Brown & Root, LLC , 483 S.W.3d 678, 702 (Tex.App.—Houston [14th Dist.] 2015, no pet.) (citing Morriss-Buick Co. v. Davis , 127 Tex. 41, 91 S.W.2d 313, 314 (Com.App.1936) ). Appellee correctly...
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