Lincoln Prop. Co. v. Kondos

• Decision Date: 22 July 2003
• Docket Number: No. 05-01-01228-CV.,05-01-01228-CV.
• Parties: LINCOLN PROPERTY COMPANY, Lincoln Eastern Management Corporation, as General Partner of EQR Lincoln, Ltd., Appellants v. Carol KONDOS, Carol Chapman Kondos, P.C. d/b/a Kondos & Kondos, all individually and on behalf of all others similarly situated, Appellees.
• Court: Texas Supreme Court

Page 1

110 S.W.3d 712

LINCOLN PROPERTY COMPANY, Lincoln Eastern Management Corporation, as General Partner of EQR Lincoln, Ltd., Appellants v. Carol KONDOS, Carol Chapman Kondos, P.C. d/b/a Kondos & Kondos, all individually and on behalf of all others similarly situated, Appellees.

No. 05-01-01228-CV.

Court of Appeals of Texas, Fifth District, Dallas.

Opinion Filed July 22, 2003.

Debra Janece McComas, Dallas, for Appellants.

Keith M. Jensen, Law Office of Keith M. Jensen, P.C., John W. MacPete, MacPete Law Firm, Fort Worth, for Appellees.

Before Justices MOSELEY, BRIDGES, and LAGARDE¹.

OPINION

Opinion By Justice JIM MOSELEY.

This case is an interlocutory appeal of an order granting class certification. See Tex. Civ. Prac. & Rem. Code Ann. § 51.014 CIV. PRAC. & REM.(a)(3) (Vernon Supp. 2003). However, while the interlocutory appeal was pending and despite the express statutory provision that such an appeal "shall have the effect of staying the commencement of a trial in the trial court pending resolution of the appeal," see id. § 51.014(b), the parties filed and scheduled a hearing on, and the trial court heard and decided, motions for summary judgment on the underlying case. The trial court subsequently entered a final judgment disposing of the underlying case on the merits, based on the summary judgments. As a result of this unusual procedural history, we dismiss this appeal as moot.

Prior to August 1979, a party could not immediately appeal a Texas trial court's interlocutory order that certified or refused to certify a suit as a class action. See Ernest F. Figari, Jr., Texas Civil Procedure, 34 Sw. L.J., 415, 445 (1980). However, to prevent a "waste of `lawyer effort, client money, and judicial time' involved when a class action determination is found to be erroneous on appeal and a retrial of the case is therefore necessary," the Texas Legislature provided a right to an interlocutory appeal of a trial court's order dealing with class certification. Id. at 445 n. 311 (quoting Michol O'Connor, Legislative Program: Amendment to Article 2250, 42 Tex. B.J. 23, 23 (1979)); see Tex. Civ. Prac. & Rem. Code Ann. § 51.014 CIV. PRAC. & REM.(a)(3). To fully accomplish this legislative purpose, the Legislature additionally provided that such an appeal, if taken, "shall have the effect of staying the commencement of a trial in the trial court pending resolution of the appeal." Tex. Civ. Prac. & Rem. Code Ann. § 51.014 CIV. PRAC. & REM.(b).

Appellees (collectively "Kondos")² filed suit alleging appellants (collectively "Lincoln")³ violated the Telephone Consumer Protection Act ("TCPA") and requested that the suit be certified as a class action. The court granted class certification. As permitted by the statute, Lincoln appealed the trial court's class certification order, asserting the court abused its discretion by granting appellees' motion for class certification. See id. The appeal was handled on an accelerated basis, see Tex.R.App.P. 28.1, and set for oral argument as requested by the parties. However, before the case was argued on appeal, both parties moved for summary judgment before the trial court.⁴ Further, and despite the automatic staying effect of the interlocutory appeal, the trial court proceeded to hear and decide the motions for summary judgment, and granted summary judgment for Lincoln. After all non-TCPA claims had either been severed or non-suited, the trial court signed a final judgment on January 18, 2002. In a separate appeal, Kondos complains the trial court erred by granting summary judgment in favor of Lincoln.⁵

A summary judgment hearing is considered a "trial" within the meaning of Texas Rule of Civil Procedure 63, which provides that amended pleadings offered within seven days of the date of trial shall be filed only after obtaining leave of the court. See Rose v. Kober Fin. Corp., 874 S.W.2d 358, 361 (Tex. App-Houston [14th Dist.] 1994, no writ); Hubert v. Ill. State Assistance Comm'n, 867 S.W.2d 160, 162 n. 1 (Tex.App.-Houston [14th Dist.] 1993, no writ). Similarly, we consider it almost axiomatic that conducting a summary judgment hearing, and/or entering a final judgment based in whole or part on an order granting a motion for summary judgment, is a "trial" within the meaning of section 51.014(b) and is thus subject to the automatic stay that arises from filing a notice of appeal of an order certifying or refusing to certify a class of litigants. The principles underpinning the legislative intent expressed in connection with sections 51.014(a)(3) and 51.014(b) apply equally to traditional trials and summary judgments alike.

Further, the opposite conclusion would mean a trial court could decide a summary judgment motion, and perhaps enter a final judgment based on that determination, before the judicial system determines the identity of the parties who are to be bound by the result of that litigation. This would permit, if not require, the parties and the court to expend the very "lawyer effort, client money, and judicial time" the Legislature sought to conserve by enacting section 51.014(b). Even if the merits of the case are subject to speedy resolution through the summary judgment process, thus "saving" judicial resources, such savings may well prove chimerical as the courts have to wrestle with the res judicata effects of the trial court's ruling on the merits. Such an expenditure of judicial resources may be necessary regardless of the trial court's rulings on the class issue or the merits.

This Court has the power to order a trial court to stay commencement of a trial or a summary judgment hearing. Cf. Tex.R.App.P. 24.1 ("When an appeal from an interlocutory order is perfected, the appellate court may make any temporary orders necessary to preserve the parties' rights until disposition of the appeal. . . ."); Waite v. Waite, 76 S.W.3d 222, 223 (Tex.App.-Houston [14th Dist.] 2002, no pet.) (per curiam) (appellate court may order stay of trial while interlocutory appeal of order appointing receiver is pending); Teran v. Valdez, 929 S.W.2d 37, 38 (Tex.App.-Corpus Christi 1996, no writ) (appellate court may stay trial while interlocutory appeal on issue of governmental immunity is pending); see also Sheinfeld, Maley & Kay, P.C. v. Bellush, 61 S.W.3d 437, 439 (Tex.App.-San Antonio 2001, no pet.) (trial court has no discretion to commence "trial" while interlocutory appeal of class certification order is pending). Here, neither party requested a stay from this Court. Moreover, both parties sought to commence the "trial" below by filing and/or arguing motions for summary judgment while this appeal was pending.

Courts are limited by the mootness doctrine to deciding only cases in which an actual controversy exists. In re Salgado, 53 S.W.3d 752, 757 (Tex.App.-El Paso 2001, orig. proceeding) (citing Fed. Deposit Ins. Corp. v. Nueces County, 886 S.W.2d 766, 767 (Tex. 1994)). "When there has ceased to be a controversy between the litigating parties due to events occurring after judgment has been rendered by the trial court, the decision of an appellate court would be a mere academic exercise and the [appellate] court may not decide the appeal." Id. "Stated another way, if the [appellate court's] judgment cannot have a practical effect on an existing controversy, the case is moot." Id.; see also VE Corp. v. Ernst & Young, 860 S.W.2d 83, 84 (Tex. 1993) (appeal is moot when court's action on merits cannot affect rights of parties).

Any interlocutory class certification orders merge into the final judgment in this case. See In re Romero, ...