Browning v. Navarro

• Decision Date: 26 August 1987
• Docket Number: No. 86-1444,86-1444
• Parties: Jane H. BROWNING, Individually and as Co-Independent Executrix of the Estate of William W. Browning, Jr., Deceased, etc., et al., Plaintiffs-Appellants, Cross- Appellees, v. Don NAVARRO, Individually and As Trustee for Pat S. Holloway, etc., et al., Defendants-Appellees, v. Pat S. HOLLOWAY, Defendant-Appellee, Cross-Appellant.
• Court: U.S. Court of Appeals — Fifth Circuit

Page 335

826 F.2d 335

Jane H. BROWNING, Individually and as Co-Independent Executrix of the Estate of William W. Browning, Jr., Deceased, etc., et al., Plaintiffs-Appellants, Cross- Appellees, v. Don NAVARRO, Individually and As Trustee for Pat S.

Holloway, etc., et al., Defendants-Appellees, v. Pat S. HOLLOWAY, Defendant-Appellee, Cross-Appellant.

No. 86-1444.

United States Court of Appeals Fifth Circuit.

Aug. 26, 1987.

Rehearing and Rehearing En Banc Denied Sept. 24, 1987.

Thomas V. Murto, III, R. Jack Ayres, Jr., Dennis Olson, Dallas, Tex., for plaintiffs-appellants, cross-appellees.

Cheryl Ann Sigsbee, Timothy J. Vineyard, Scott C. Larsen, Dallas, Tex., for Navarro.

Pat S. Holloway, Giddings, Tex., pro se.

Appeal from the United States District Court for the Northern District of Texas.

Before POLITZ, JOLLY and HIGGINBOTHAM, Circuit Judges.

E. GRADY JOLLY, Circuit Judge:

This unrelenting battle between the Brownings and the Holloways, which began in 1979, is a familiar fray to this court. It has been marched up the hill to us several times before. We march it back down once again.

The state court judgment, which the Brownings seek to enforce in the bankruptcy court against Holloway and his assets, may involve more than $100,000,000, and we suppose, would pretty much wipe out Holloway if enforced. Yet for various reasons he has never had consideration, by either the federal or state courts, of the merits of his colorable claim that the state court judgment resulted from the corrupt abuse of the judicial process. Today we remand to allow consideration of his claim that the state court judgment was procured by fraud. We reject, however, each and every other argument he makes and trust that we have sufficiently narrowed this case so that the litigation can be concluded with the disposition of this single issue. ¹

I

Renditions of the facts in this case and related cases already fill many pages of the federal reporter system, ² but we repeat them here for the sake of clarity.

"The complicated history of this case begins on September 12, 1979, when the Brownings ... filed suit against Humble [Exploration Co. Inc.] (Humble), [Pat] Holloway (Holloway), and others in the 193rd Judicial District Court of Dallas County, Texas, seeking, as the alleged equitable owners of substantially all the assets of Humble and Holloway, the imposition of a constructive trust on Humble's and Holloway's assets, actual and exemplary damages, and the appointment of an interim receiver to manage the disputed assets. Sterling Pipeline Company was later added to the case. (The lawsuit is hereinafter referred to as the '1979 case.') On November 19, 1979, Humble and Holloway filed Chapter 11 voluntary bankruptcy petitions and removed the 1979 case to the United States Bankruptcy Court for the Northern District of Texas pursuant to 28 U.S.C. Sec. 1478(a).

"The parties entered a 'Stipulation and Agreement on Manner in Which Controversy Shall be Heard, Determined and Liquidated,' which was approved by the bankruptcy court and annexed to the court's January 18, 1980 'Order Remanding Causes of Action and Modifying Automatic Stay.' The remand order remanded the 1979 case to the 193rd Judicial District Court pursuant to the terms of the stipulation and agreement, and modified the automatic stay to permit trial of the case upon remand, subject to the terms of the stipulation and agreement. The stipulation and agreement provided, among other things, that upon remand of the case the parties would request the presiding judge of the administrative judicial district to assign a visiting or retired state judge to hear the consolidated cases.

"The case was remanded and the presiding judge assigned it to a retired state judge who ordered enforcement of a prior settlement agreement. In 1981, the Court of Appeals for the Fifth Supreme Judicial District of Texas (the 'Texas court of appeals') reversed the order enforcing the settlement agreement and remanded the case for a jury trial. The Texas Supreme Court found no reversible error. Upon remand from the state appellate courts, the 1979 case was assigned to a different retired state judge who entered an order nullifying the prior settlement agreement.

"On May 26, 1982, a group of investors sued Holloway and Humble in the 162nd Judicial District Court of Dallas County, Texas, Judge Dee Brown Walker presiding, claiming that Humble had wrongfully shut in over 150 oil and gas wells jointly owned by the investors and Humble. This suit is alleged by Holloway to have been brought pursuant to the conspiracy, solely for the purpose of creating a case before Walker into which the 1979 [case] could be consolidated, in violation of the agreement that restricted the judge who could hear the 1979 [case] to one who had retired or was visiting the judicial district. The investors sought the appointment of a receiver over Humble's assets. (The case is hereinafter referred to as the '1982 case'.) The Brownings were named as defendants in the 1982 case because of their claim to ownership of Humble's and Holloway's assets. The 1982 case was removed to the bankruptcy court and remanded to Judge Walker's court on the same day.

"On May 28, 1982, Judge Walker appointed a receiver in the 1982 case over Humble's and Holloway's assets. Thereafter 'ensued a somewhat dizzying sequence of state court orders,' most of which were issued by Judge Walker, and recounted in Browning v. Navarro, 37 B.R. 201, 205-06 (N.D.Tex.1983), which resulted in the transfer and consolidation of the 1979 case into the 1982 case before Judge Walker in the 162nd Judicial District Court. On June 24, 1982, the May 28, 1982 receivership order having been vacated by the state court of appeals, ³ Judge Walker granted the Brownings' request for a separate and expedited trial of the 1979 case. On August 26, 1982, after a month-long trial, judgment was entered in the 1979 case for the Brownings, imposing a constructive trust on Humble's and Holloway's assets and awarding the Brownings actual damages of $72,000,000 and exemplary damages of $10,000,000.

"On November 18, 1982, Holloway and Humble brought [a section 1983 action] (the 'civil rights case ') against Judge Walker, the Brownings, legal counsel for the Brownings and many others, alleging that all the defendants had conspired to violate Holloway's and Humble's civil rights in the 1979 case. The complaint allege[d] that Walker and the other defendants conspired to seize control of Humble through the abuse of Walker's judicial office. Holloway contend[ed] that pursuant to the conspiracy Walker arranged to have the 1982 case brought before his court contrary to the usual procedure for assigning cases, that Walker thereafter arranged to have the 1979 and the 1982 case consolidated in his court, that he imposed receiverships on Humble's and Holloway's assets, defied a mandamus order of the Texas Court of Appeals to refrain from interfering in Humble's business, appointed an incompetent receiver for Humble, dismissed many Humble personnel [including attorneys], posted guards at Humble's headquarters to seize the building, [prohibited release of corporate and legal files during the trial], and, in a hotel near the courthouse, conducted meetings regarding Humble's business, all in furtherance of the conspiracy. Holloway contend[ed] extensive damage was done to him and Humble through Walker's pernicious actions ... [on appeal, we affirmed the district court's grant of summary judgment, holding that its allegations did "not amount to a violation of constitutional due process" 784 F.2d at 1294].

....

"After Holloway and Humble filed the civil rights case they perfected an appeal from the judgment in the 1979 case to the Texas court of appeals. The Texas court of appeals was the appropriate Texas appellate court to hear the appeal of a case from Judge Walker's court. However, neither Humble nor Holloway posted a supersedeas bond to stay execution of the judgment in the 1979 case pending their appeal.

"The Brownings then brought [the] action [in which this appeal is taken] in the United States District Court (the 'turn-over action ') to obtain possession of Holloway's and Humble's assets which, according to the judgment in the 1979 case, were being held for their benefit. Humble, Holloway and their trustee, Don Navarro, refused to turn the assets over to the Brownings. They argued that the proceedings before Judge Walker, an active judge, were void because the 1979 case was tried in contravention of the bankruptcy court's original remand order. The United States District Court granted a summary judgment in favor of Navarro and held that the trial of the 1979 case before Judge Walker was void. This court, however, reversed the district court's determinations and held that the trial before Judge Walker was not void because the remand order had been satisfied. Browning v. Navarro, 743 F.2d 1069 (5th Cir.1984).

"The appeal of the 1979 case was pending in the Texas court of appeals while the turnover action was being litigated in the United States District Court. The Texas court of appeals, however, believed that the turnover action constituted a collateral attack on Judge Walker's judgment in the 1979 case. Therefore, the Texas court of appeals dismissed Humble's and Holloway's appeal ⁴ because it did not believe Humble and Holloway were entitled to two appeals from the judgment in the 1979 case. However, following this court's reversal of the district court's decision in the turnover action, the Texas court of appeals vacated its prior order dismissing the appeal of the 1979 case...." ⁵

"After the reversal of the district court's decision in the turnover action, the Texas court vacated its prior order of dismissal. However, the appellate court, sitting en banc, later reinstated the order of dismissal. Humble Exploration Co. v. Browning, 690 S.W.2d 321 (Tex.Ct.App.1985) (en banc), reinstating 677...