Freeman v. Pevehouse

• Decision Date: 29 May 2002
• Docket Number: No. 10-01-114-CV.,10-01-114-CV.
• Citation: 79 S.W.3d 637
• Parties: Mishawndria FREEMAN, Appellant, v. Annie PEVEHOUSE, Appellee.
• Court: Texas Court of Appeals

79 S.W.3d 637

Mishawndria FREEMAN, Appellant, v. Annie PEVEHOUSE, Appellee.

No. 10-01-114-CV.

Court of Appeals of Texas, Waco.

May 29, 2002.

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David Johnson, Keith Dorsett, Fulbright & Winniford, P.C., Waco, for appellant.

Michael L. Scanes, Naman, Howell, Smith & Lee, P.C., Waco, Keith C. Cameron, Naman, Howell, Smith & Lee, P.C., Austin, for appellee.

Before Chief Justice DAVIS, Justice VANCE, and Justice GRAY.

LEAD OPINION

TOM GRAY, Justice.

Annie Pevehouse was involved in an automobile accident on September 25, 1998, with Mishawndria Freeman, an insured of Allstate Insurance Company. After negotiations to resolve the dispute for over one year failed, Pevehouse filed a personal injury suit against Freeman on September 21, 2000. Freeman was served on November 15, 2000. Freeman failed to timely file an answer. On January 11, 2001, Pevehouse appeared at a default judgment hearing, offered evidence, and obtained a default judgment. Freeman timely filed a motion for new trial. After a hearing the motion was denied by operation of law. Freeman brought this appeal contending the trial court abused its discretion in denying its motion for new trial.

MOTION FOR NEW TRIAL — DEFAULT JUDGMENT

In her only issue, Freeman claims the trial court erred in denying her motion for new trial because she met the three requirements for a new trial established by the Texas Supreme Court. See Craddock v. Sunshine Bus Lines, 134 Tex. 388, 133 S.W.2d 124 (1939). Freeman bears the burden of proving that Freeman's and Allstate's failure to file the answer was not intentional or the result of conscious indifference, but due to a mistake or accident. Holt Atherton Industries, Inc. v. Heine, 835 S.W.2d 80, 83 (Tex.1992); P & H Transportation, Inc. v. Robinson, 930 S.W.2d 857, 861 (Tex.App.-Houston [1st Dist.] 1996, writ denied); Memorial Hosp. Sys. v. Fisher Insurance Agency, Inc., 835 S.W.2d 645, 652 (Tex.App.-Houston [14th Dist.] 1992, no writ). Freeman cannot be relieved from a default judgment on the ground that she turned the petition over to Allstate and relied upon Allstate to file an answer without showing why Allstate failed to answer. Memorial Hosp. Sys., 835 S.W.2d at 652.

Pevehouse does not challenge that Freeman, individually, did not fail to answer intentionally or with conscious indifference, nor that Freeman offered evidence to support the second and third elements of the Craddock test for both Freeman and Allstate. Therefore, the scope of the issue is limited to the first prong of Craddock, specifically whether Allstate's failure to timely answer was not intentional or the result of conscious indifference, but was due to a mistake or an accident. Craddock, 133 S.W.2d at 126.

APPLICABLE LAW

A motion for new trial is addressed to the trial court's discretion, and the court's ruling will not be disturbed on appeal in the absence of an abuse of discretion. Cliff v. Huggins, 724 S.W.2d 778 (Tex.1987); Strackbein v. Prewitt, 671 S.W.2d 37, 38 (Tex.1984). The prerequisites for granting a motion to set aside a trial court's default judgment equally apply to a no-answer and a post-answer default judgment. Cliff, 724 S.W.2d at 779; Grissom v. Watson, 704 S.W.2d 325 (Tex. 1986). In Craddock, the Supreme Court set forth the guiding rule or principle which trial courts must follow in determining whether to grant a motion for new trial:

A default judgment should be set aside and a new trial ordered in any case in which the failure of the defendant to answer before judgment was not intentional, or the result of conscious indifference on his part, but was due to a mistake or an accident; provided the motion for a new trial sets up a meritorious defense and is filed at a time when the granting thereof will occasion no delay or otherwise work an injury to the plaintiff.

Cliff, 724 S.W.2d at 779; Craddock, 133 S.W.2d at 126.

The defaulting defendant has the burden of proving all three elements of the Craddock test are met before a trial court is required to grant a motion for new trial. Sunrizon Homes, Inc. v. Fuller, 747 S.W.2d 530 (Tex.App.-San Antonio 1988, pet. rehear'g denied). A trial court abuses its discretion by not granting a new trial when all three elements of the Craddock test are met. Director, State Emp. Wkrs.' Comp. v. Evans, 889 S.W.2d 266, 268 (Tex. 1994).

INTENT OR CONSCIOUS INDIFFERENCE

In determining whether the failure to answer was due to intentional conduct or conscious indifference we must look to the knowledge and acts of the defendant as shown by all the evidence contained in the record before the court. Id. at 269; Strackbein v. Prewitt, 671 S.W.2d 37, 38-39 (Tex.1984). If the factual assertions in the defendant's affidavits are not controverted by the plaintiff, the defendant satisfies his burden if his affidavit sets forth facts that, if true, negate intentional or consciously indifferent conduct by the defendant. Strackbein, 671 S.W.2d at 38-39. However, conclusory allegations are insufficient. Holt Atherton Industries, Inc. v. Heine, 835 S.W.2d 80, 82 (Tex.1992); Folsom Investments, Inc. v. Troutz, 632 S.W.2d 872, 875 (Tex.App.-Ft. Worth 1982, writ ref'd).

To determine if the defendant's factual assertions are controverted, the court looks to all the evidence in the record. Director, State Emp. Wrks.' Comp. v. Evans, 889 S.W.2d 266, 269 (Tex.1994). When the non-movant presents evidence at the hearing for new trial tending to show intentional or consciously indifferent conduct, it becomes a question for the trial court to determine. Young v. Kirsch, 814 S.W.2d 77, 80-81 (Tex.App.-San Antonio 1991, pet. rehear'g denied). Jackson v. Mares, 802 S.W.2d 48, 50 (Tex.App.-Corpus Christi 1990, writ denied).

INFERENCES

The Supreme Court of Texas has held that the trier of fact may draw inferences from evidence presented, but only reasonable and logical ones. Hammerly Oaks, Inc. v. Edwards, 958 S.W.2d 387, 392 (Tex.1997). An ultimate fact may be established by circumstantial evidence when the fact may be fairly and reasonably inferred from other facts in the case. Blount v. Hoydens, Inc., 910 S.W.2d 931, 933 (Tex.1995). But an ultimate fact may not be inferred by the trier of fact if the evidence is only "meager circumstantial evidence" which could give rise to any number of inferences, none more probable than another. Hammerly Oaks, 958 S.W.2d 387, 392 (quoting Litton Indus. Prods. v. Gammage, 668 S.W.2d 319, 324 (Tex.1984)). If meager circumstantial evidence gives rise to inferences which are equally consistent with two facts and nothing shows that one inference is more probable than the other, neither fact can be inferred. Litton Indus. Prods. v. Gammage, 668 S.W.2d 319, 324 (Tex.1984); Texas Sling Co. v. Emanuel, 431 S.W.2d 538 (Tex.1968); Continental Cas. Co. v. Fountain, 257 S.W.2d 338 (Tex.Civ.App.-Dallas 1953, writ ref'd). There must be more than a scintilla of circumstantial evidence on which to reasonably infer a fact. Blount v. Bordens, Inc., 910 S.W.2d 931, 933 (Tex.1995). And "[e]vidence is merely a scintilla when it is so weak as to do nothing more than create a mere surmise or suspicion of a fact." Jacobs-Cathey Co. v. Cockrum, 947 S.W.2d 288, 293 (Tex. App.-Waco 1997, pet. rehear'g denied).

EVIDENCE IN THE RECORD

Freeman

Freeman stated in her affidavit that she was served with a citation and petition on the night of November 16, 2000. The next day Freeman called her insurance agent, Richard Duncan, with Mexia Insurance Service. On the afternoon of November 17, 2000, Freeman went to Duncan's office. After looking at the lawsuit papers Duncan faxed them to Allstate in Austin, Texas.

Freeman tried to reach Allstate representative Jeff Hill by phone several times during the following week, but never could. Freeman finally went through the switchboard and asked to be connected with Hill's boss. Freeman spoke with an individual who indicated they had the lawsuit papers, she shouldn't worry about it, and they were handling it. Freeman remembered specifically mentioning the twenty day period in which to file an answer. Freeman did not hear about the lawsuit again until she was told a default judgment had been taken against her. Freeman's affidavit concludes with the statement; "[t]he failure to timely file an answer was not intentional or the result of conscious indifference on my part, but must have been due to mistake or accident on the part of Allstate Insurance Company."

Shivers

Sherry Shivers stated in her affidavit that she is employed by Mexia Insurance Service in Mexia, Texas, that on or about November 17, 2000, Freeman went into the office with the citation and petition for this case and that Freeman indicated she had been served with the papers the night before. Shivers stated: "we faxed the papers to Allstate Insurance Company in Austin, Texas on November 17, 2000 for Ms. Freeman. There was no error in the facsimile transmission."

Medellin

Evaristo Medellin stated in his affidavit that he is employed by Allstate in Austin as a Senior Claims Service Adjuster. This claim was originally received by Allstate in October, 1998. Medellin began working on the file regarding this case on or about August 30, 2000. Medellin spoke with Simms, Pevehouse's first attorney, on or about September 6, 2000. He further states that an Allstate representative tried to return calls of the insured on November 30, December 1, and December 4, but was not able to reach her. He then received a letter dated December 13, 2000 from Scanes, Pevehouse's second attorney, indicating Scanes would take a default judgment on December 20, 2000. Medellin states that "when I received the letter, I called Mr. Scanes and was informed that he had already taken default."

Medellin states he spoke with Freeman and Freeman's agent, and from those conversations he learned the agent had called Allstate and been told to fax the suit papers. Freeman's agent...