Klein v. Dooley
| Decision Date | 09 July 1997 |
| Docket Number | No. 96-1285,96-1285 |
| Citation | 949 S.W.2d 307 |
| Parties | 40 Tex. Sup. Ct. J. 912 James KLEIN, Ramona Klein, and Ruby Klein, Petitioners, v. Carol DOOLEY d/b/a Re-Max Champions, Steve Ernst, Elyse Ernst, and Matthew Jones, Respondents. |
| Court | Texas Supreme Court |
Richard W. Ewing, Dennis M. Beck, Houston, for Petitioners.
Daniel L. Burkeen, Grosebeck, Thomas E. Edmondson, William Brent Clarkson, James F. Tyson, Houston, for Respondents.
A defendant in a suit under the Deceptive Trade Practices Act may recover costs and attorney's fees if the trial court finds that the plaintiff's DTPA claims were groundless or made in bad faith or for purposes of harassment. TEX. BUS. & COM.CODE § 17.50(c). A plaintiff's voluntary nonsuit does not affect a defendant's pending counterclaim for costs and attorney's fees. TEX.R. CIV. P. 162. Today we consider: When DTPA plaintiffs take a voluntary nonsuit and the trial court later rules that the defendants are not entitled to costs and fees under section 17.50(c), does the trial court's judgment preclude the plaintiffs from filing their claims in a second suit, under Texas Rule of Civil Procedure 97(a) governing compulsory counterclaims? We hold that on these facts, the trial court's judgment in the first suit does not preclude the plaintiffs' claims in a second suit.
James, Ramona, and Ruby Klein sued Matthew Jones, Steve Ernst, Elyse Ernst, and Carol Dooley for negligence and violations of various statutes including the Deceptive Trade Practices Act in connection with the Kleins' purchase of a house from Jones. Dooley and Steve Ernst asserted counterclaims under section 17.50(c) of the DTPA for costs and attorney's fees, alleging that the Kleins had filed groundless, bad faith, or harassing DTPA claims. At trial, the court excluded the Kleins' expert witness testimony and documentary evidence as a discovery sanction, and the Kleins announced a nonsuit without prejudice on all their claims.
The Kleins then sued Jones, the Ernsts and Dooley a second time, asserting the same factual allegations and the same theories of recovery except for the DTPA claims. Meanwhile, a year after the nonsuit, the trial court in the first suit found that the Kleins' DTPA allegations were not groundless, harassing, or in bad faith, and denied the pending counterclaims. Jones, the Ernsts, and Dooley then moved for summary judgment in the second suit, arguing the Kleins' claims were precluded by res judicata and Rule 97(a) governing compulsory counterclaims. Jones also moved for summary judgment on the Kleins' negligence claims on a limitations defense.
The trial court granted summary judgment for Jones, the Ernsts, and Dooley on all the Kleins' claims. The court of appeals affirmed, holding that the Kleins' real estate fraud claims were barred as compulsory counterclaims to Dooley's and Ernst's claims under section 17.50(c) for costs and attorney's fees based on the filing of groundless, bad faith, or...
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Appendix - Desk Book
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