Chiriboga v. State Farm Mut. Auto. Ins. Co.

• Citation: 96 S.W.3d 673
• Decision Date: 16 January 2003
• Docket Number: No. 03-01-00148-CV.,03-01-00148-CV.
• Parties: Augusto CHIRIBOGA and David Augusto Chiriboga, Appellants, v. STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, Appellee.
• Court: Texas Court of Appeals

96 S.W.3d 673

Augusto CHIRIBOGA and David Augusto Chiriboga, Appellants, v. STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, Appellee.

No. 03-01-00148-CV.

Court of Appeals of Texas, Austin.

January 16, 2003.

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B. Buck Pettitt, Flores, Casso & Pettitt, L.L.P., McAllen, for Appellant.

Robert A. Allen, Jeff Small, Allen, Stein & Durbin, P.C., San Antonio, for Appellee.

Before Justices KIDD, YEAKEL and PATTERSON.

OPINION

LEE YEAKEL, Justice.

This is an appeal from an order denying a motion to transfer venue and an order dismissing the defendants' counterclaim for attorney's fees and costs without notice or a hearing. This action was brought by appellee State Farm Mutual Automobile Insurance Company ("State Farm") against its insureds, appellants Augusto Chiriboga and his son, David Augusto Chiriboga, and others to resolve a coverage dispute under an automobile policy issued to Augusto Chiriboga by State Farm. We will reverse because the district court erred in overruling the Chiribogas' motion to transfer venue.

FACTUAL AND PROCEDURAL BACKGROUND

This is a coverage dispute arising out of a vehicular collision that occurred in Hidalgo County on February 25, 1998, involving a vehicle owned by Augusto Chiriboga and driven by David Chiriboga. On May 27, 1998, both father and son were sued for negligence in Hidalgo County by those injured in the collision, who were also residents of Hidalgo County (the "Gonzalez lawsuit").¹ The accident occurred during the coverage period of the State Farm policy insuring the Chiribogas. The Chiribogas made a demand for defense and indemnity from State Farm. State Farm tendered a qualified defense, issued a reservation of rights letter, and, on January 4, 1999, filed this declaratory judgment action in Milam County. All defendants in the declaratory-judgment action sought to transfer venue to Hidalgo County, but their motions were denied.

The Chiribogas demanded a jury and filed counterclaims seeking attorney's fees and costs pursuant to the Uniform Declaratory Judgments Act. See TEX. CIV. PRAC. & Rem.Code Ann. § 37.009 (West 1997). State Farm subsequently settled the Gonzalez lawsuit. Just before trial in the Milam County suit, however, State Farm moved to dismiss all of its claims, as well as the Chiribogas' affirmative counterclaim for attorney's fees and costs. State Farm filed its motion on December 18, 2000, and without a hearing the district court signed an order granting State Farm's motion the next day. The order dismissed all claims, expressly including the Chiribogas' counterclaims.

DISCUSSION

The Chiribogas appeal the district court's refusal to transfer the case to Hidalgo County, as well as its order dismissing their affirmative claims without notice and a hearing. Because we conclude that the district court erred in not transferring venue, we do not reach the dismissal issue.

Legal Standards Governing Motions to Transfer Venue and Standard and Scope of Review

Texas's venue scheme divides venue into categories, including "general," "mandatory," and "permissive." Mandatory provisions trump permissive ones. See Wichita County v. Hart, 917 S.W.2d 779, 781 (Tex.1996); Allison v. Fire Ins. Exchg., 98 S.W.3d 227, 242 (Austin 2002, no pet. h.). Plaintiffs are accorded the right to choose venue first; as long as suit is initially filed in a county of proper venue (i.e., the county is at least a permissive venue and no mandatory provision applies), the plaintiff's venue choice cannot be disturbed. Wilson v. Tex. Parks & Wildlife Dep't, 886 S.W.2d 259, 261 (Tex. 1994). However, if the county to which transfer is sought is a county of mandatory venue, then it is reversible error to deny a transfer. Hart, 917 S.W.2d at 781. On the other hand, if the dispute is between two counties of permissive venue, transferring the case is improper. Wilson, 886 S.W.2d at 262. In cases involving disputes over permissive venue, the entire record is reviewed for any probative evidence that venue was proper in the original county of suit. Id.

In reviewing a venue decision, the appellate court must conduct an independent review of the entire record, including where applicable, the trial on the merits, to determine whether any probative evidence supports the trial court's venue decision. Ruiz v. Conoco, Inc., 868 S.W.2d 752, 758 (Tex.1993).² Courts review the evidentiary record in the light most favorable to the venue ruling; however, no deference is given to the trial court's application of the law. Id. If there is any probative evidence supporting venue in the county where judgment was rendered, the judgment must be affirmed. Id.; Bonham State Bank v. Beadle, 907 S.W.2d 465, 471 (Tex.1995). If no such evidence exists, the case must be reversed. TEX. CIV. PRAC. & Rem.Code Ann. § 15.063 (West Supp. 2003); Ruiz, 868 S.W.2d at 758; Allison, at ___, No. 03-01-00717-CV, slip op. at 19, 2002 WL 31833440, 2002 Tex.App. LEXIS 8957, at *29; Eddins v. Parker, 63 S.W.3d 15, 18 (Tex. App.-El Paso 2001, pet. denied).

A plaintiff's choice of venue stands unless challenged by a proper motion to transfer venue. In re Mo. Pac. R.R.Co., 998 S.W.2d 212, 216 (Tex.1999). Once challenged, the plaintiff has the burden to present prima facie proof that venue is maintainable in the county of suit. In re Masonite Corp., 997 S.W.2d 194, 197 (Tex.1999); TEX.R. CIV. P. 87(2)(a), (3)(a). The plaintiff's prima facie proof is not subject to rebuttal, cross-examination, impeachment, or disproof. Ruiz, 868 S.W.2d at 757. The action must remain in the county of suit if the plaintiff selected a county of proper venue and supported the selection with prima facie proof supporting venue there. Wilson, 886 S.W.2d at 261.

As a result, an appellate court cannot review the sufficiency of the evidence supporting the plaintiff's venue choice. Ruiz, 868 S.W.2d at 758. If there is any probative evidence supporting venue in the county of suit, a transfer should be denied even if the evidence preponderates to the contrary. Beadle, 907 S.W.2d at 471; Wilson, 886 S.W.2d at 262. However, conclusive evidence to the contrary can destroy the "probative evidence." See Ruiz, 868 S.W.2d at 757; Rosales v. H.E. Butt Grocery Co., 905 S.W.2d 745, 750 (Tex.App.-San Antonio 1995, writ denied).

None of the mandatory or specific permissive venue provisions apply in this case. Venue here is governed by the general venue rule contained in section 15.002(a) of the Texas Civil Practices and Remedies Code. See Beadle, 907 S.W.2d at 471 (declaratory judgment action governed by general venue rule). Section 15.002(a)(1) provides that venue is proper in the county where "all or a substantial part of the events or omissions giving rise to the claim occurred" or the county "of defendant's residence at the time the cause of action accrued if defendant is a natural person." TEX. CIV. PRAC. Rem.Code Ann. § 15.002(a)(1), (2) (West 2002). In this case, we must determine whether there is any probative evidence to support the district court's implied ruling that "all or a substantial part of" the events giving rise to this lawsuit occurred in Milam County.

The Venue Facts

State Farm's factual basis for maintaining venue in Milam County is that Milam County is the location of State Farm's local insurance agent, Lloyd Curington, who sold the policy. When Augusto Chiriboga reported the collision to State Farm, he called Curington in Milam County. Thus, State Farm argues venue was proper under section 15.002(a)(1) because "all or a substantial part of the events ... giving rise to the claim" occurred in that county.

State Farm's coverage defense was based on a policy provision excluding from coverage automobiles owned by the insured but not scheduled on the policy. State Farm contended that the 1983 Cadillac Cimarron, owned by Augusto Chiriboga and driven by David Chiriboga, was not a scheduled vehicle. Therefore, State Farm asserts, coverage for the Cimarron was excluded for any damages arising out of its operation. On the other hand, the Chiribogas contend that the Cimarron had been a scheduled vehicle on this policy and that Augusto Chiriboga never authorized its removal from the policy. State Farm's factual theory supporting venue in Milam County is that the removal of the Cimarron as a scheduled vehicle on the policy actually occurred in Milam County. State Farm's local agent, who was responsible for scheduling vehicles on that policy, was located in Milam County. Thus, State Farm contends, Milam County became the site of a substantial part of the facts giving rise to its coverage defense. As a basis for venue, State Farm also points to the fact that Augusto Chiriboga purchased the original policy in Milam County some fourteen years earlier. However, Augusto Chiriboga was living in Hidalgo County the last time the policy was renewed by State Farm.

In addition to affidavits, depositions were taken on the issues surrounding the alleged policy change. Excerpts of the depositions were submitted as evidence both supporting and opposing the venue motions. Augusto Chiriboga testified that State Farm had been his insurance carrier for many years and that whenever he purchased a new vehicle his practice was to have the car salesman contact State Farm and request that the new vehicle be added to his auto policy. That is what happened in this instance. When he bought a new Cadillac Catera in Hidalgo County, he had the salesman at the Cadillac dealership contact State Farm in order to add the Catera to his policy. He testified that he received a letter from State Farm stating that it had received his request for a policy change and that the change would be reflected on the next billing statement. Augusto Chiriboga testified that he was unaware that his instructions were not followed until State Farm refused coverage in connection with the accident in question.

State Farm does not dispute that the Cadillac salesman...