Ex parte Johnson

• Decision Date: 06 July 1983
• Docket Number: No. C-1635,C-1635
• Citation: 654 S.W.2d 415
• Parties: Ex parte Gerald W. JOHNSON.
• Court: Texas Supreme Court

Page 415

654 S.W.2d 415

Ex parte Gerald W. JOHNSON.

No. C-1635.

Supreme Court of Texas.

July 6, 1983.

David H. Berg, Houston, for relator.

Bobbie Bayless, Houston, Jim Mattox, Atty. Gen., Laurie Martin, Asst. Atty. Gen., Austin, for respondent.

McGEE, Justice.

Relator, Dr. Gerald W. Johnson, brought this original habeas corpus proceeding after the district court held him in contempt and committed him to jail for thirty days for failure to comply with the court's "turnover" order entered pursuant to article 3827a of the Texas Revised Civil Statutes. We order Relator discharged.

A judgment was rendered against Johnson in February, 1982. The judgment creditors thereafter instituted a number of post-judgment proceedings to collect the judgment, including an Application for Turnover Relief filed pursuant to article 3827a. That statute authorizes a court to order a judgment debtor to turn over certain property, documents, and records to be applied towards satisfaction of the judgment. Johnson received notice on May 10, 1982 that a hearing would be conducted that day on the Application for Turnover Relief. Johnson did not attend the hearing, but was represented by his attorney. At the conclusion of the hearing, the court ordered Johnson to turn over certain assets, documents, and records to the registry of the court and to the judgment creditors. The Turnover Order was not signed until May 13, 1982, and required compliance by 2:00 p.m., May 14, 1982. The order was lengthy and detailed, and specifically directed Johnson to produce assets and records located outside as well as inside the state of Texas.

On May 21, the judgment creditors filed a Motion for Contempt which alleged specific violations of the turnover order. Johnson was personally served on June 1, 1982, with a Motion for Contempt and a Show Cause Order directing him to appear on June 14, 1982 to show cause why the motion for contempt should not be granted. On advice of his attorney, Johnson did not personally appear at the contempt hearing, but was represented by his attorney. Testimony was taken which indicated Johnson had not complied with the turnover order. Johnson's attorney did not cross-examine the witness, and no testimony was offered on Johnson's behalf. The court found Johnson guilty of contempt and sentenced him to thirty days' confinement in the Harris County jail.

This is a case of constructive criminal contempt. Johnson's confinement was ordered pursuant to article 1911a, Tex.Rev.Civ.Stat., as punishment for his failure to comply with a court order which was to be performed outside the presence of the Court. See Ex parte Werblud, 536 S.W.2d 542, 546-47 (Tex.1976). The habeas corpus relief sought by Johnson is a collateral attack upon that contempt judgment.

A. ARTICLE 3827a

Johnson first argues his confinement violates due process because he cannot be held in contempt for violating a void order. Johnson contends the Turnover Order was void for three reasons. First, article 3827a, the "Turnover Statute," does not require notice and hearing to the judgment debtor prior to entry of the turnover order. Second, the court had no power to order Johnson to turn items directly over to the judgment creditors instead of the constable or sheriff. Finally, the order was impossible to comply with on its face, and alternatively, Johnson was involuntarily unable to comply.

Article 3827a provides, in part:

(a) A judgment creditor whose judgment debtor is the owner of property, including present or future rights to property, which cannot readily be attached or levied on by ordinary legal process and is not exempt from attachment, execution, and every type of seizure for the satisfaction of liabilities, is entitled to aid from a court of appropriate jurisdiction by injunction or otherwise in reaching the property to satisfy the judgment.

(b) The court may order the property of the judgment debtor referred to in Subsection (a) of this section, together with all documents or records related to the property, that is in or subject to the possession or control of the judgment debtor to be turned over to any designated sheriff or constable for execution or otherwise applied toward the satisfaction of the judgment. The court may enforce the order by proceedings for contempt or otherwise in case of refusal or disobedience.

Article 3827a is a post-judgment relief statute designed to assist judgment creditors in securing satisfaction of a final judgment. The statute authorizes a court to order a judgment debtor to turn over certain property, documents, and records which are otherwise difficult of attachment to be applied towards satisfaction of a judgment. Article 3827a, in conjunction with Rule 621a and Rule 737 of the Texas Rules of Civil Procedure, rounds out Texas' statutory equivalent to what was previously known in equity as a creditor's bill. See, e.g., G.H. & San Antonio R.R. Co. v. Louisa McDonald, 53 Tex. 510, 515 (1880); Thurber Const. Co. v. Kemplin, 81 S.W.2d 103, 109 (Tex.Civ.App.--Austin 1935, writ dism'd). See generally, Clayton, Creditor's Bills in Texas, 5 Tex.L.Rev. 262 (1927); Pomeroy, Equity Jurisprudence § 1415 (5th ed. 1941).

We do not decide whether article 3827a is constitutionally infirm absent a requirement of notice and hearing prior to issuance of a turnover order. It is undisputed Johnson received notice on the morning of May 10 that a hearing would be held that day on the judgment creditors' Application for Turnover Relief. Johnson was represented by counsel at that hearing, and counsel noted his objection to conducting the hearing that day. Since the trial judge determined to proceed with the hearing, the proper avenue of relief would have been motion to modify the court's turnover order. ¹ Herring v. Houston National Exchange Bank, 113 Tex. 337, 255 S.W. 1097, 1103 (1923).

Johnson next asserts he cannot be held in contempt for violating an order which the court had no power to enter. Specifically, Johnson contends that article 3827a, subsection (b) does not authorize a court to order a judgment debtor to turn items directly over to a judgment creditor, and therefore the Turnover Order was void.

The language at issue is found in subsection (b) as follows:

The court may order the property of the judgment debtor referred to in Subsection (a) of this section, together with all documents or records related to the property ... to be turned over to any designated sheriff or constable for execution or otherwise applied towards satisfaction of the Judgment ... (emphasis added).

Johnson contends this language requires a judgment debtor to turn property, documents, and records over to a sheriff or constable, who may then levy execution or otherwise apply them to satisfaction of the judgment. The judgment creditors, on the other hand, argue the language authorizes the court to order either 1) that the items be turned over to a sheriff or constable for execution, or 2) that the items be otherwise applied to satisfaction of the judgment.

At least one commentator has suggested the statute allows turnover directly to judgment creditors in certain circumstances. Hittner, Texas Post-Judgment Turnover and Receivership Statutes, 45 Tex.B.J. 417, 419 (1982). The report of the House Committee on Judicial Affairs does not support this view, however. That report states:

The changes which [the bill] makes are open-ended in that they allow a judgment creditor to get aid in collection from the Court in the form of an order which requires the debtor to bring to the Court all documents and property used to satisfy a judgment. The actual effect of the bill is to require the burden of production of property which is subject to execution to be placed with the debtor instead of a creditor attempting to satisfy his judgment...

House Comm. on Judicial Affairs, Bill Analysis, Tex.H.B. 1260, 66th Leg. (1979) (emphasis added).

In light of this language, we cannot presume the legislature intended article 3827a to deny judgment debtors any measure of judicial protection in post-judgment collection proceedings. The potential for error or abuse where turnover is ordered directly to judgment creditors is obvious, considering that the statute allows ex parte entry of the order without notice and hearing. Cf. Finberg v. Sullivan, 634 F.2d 50 (3d Cir.1980); Brown v. Liberty Loan Corp. of Duval, 539 F.2d 1355 (5th Cir.1976), cert denied, 430 U.S. 949, 97 S.Ct. 1588, 51 L.Ed. 797 (1977). A debtor who in good faith complies with an order to turn items directly over to a judgment creditor may be denied any opportunity to assert defenses should the judgment creditor promptly or improperly dispose of the items. Such practice would not promote fair and orderly administration of justice. The trial court erred in ordering turnover directly to judgment creditors.

Because this habeas corpus proceeding is a collateral attack, however, a determination must be made whether the court's error rendered the turnover order void or voidable. Only if the turnover order was void may Johnson successfully challenge his confinement on this ground.

The order was lawfully issued by a court having jurisdiction over the parties and subject matter; the court therefore had power to render the order. Although it was error to order turnover directly to judgment creditors, such error went to the manner in which the court exercised its power under article 3827a, and not to the power itself. Ex parte Rhodes, 163 Tex. 31, 352 S.W.2d 249, 250 (1961). The order was not void, but voidable, and Johnson had a legal duty to comply with it until ordered otherwise. Id. Johnson's contempt judgment is not susceptible to collateral attack on this ground.

Finally, Johnson asserts the turnover order was void because it was impossible to comply with on its face. Relator contends the order required him to retrieve, simultaneously, items located both in the state and out of state and deliver the same...