Mantas v. Fifth Court of Appeals

• Decision Date: 12 July 1996
• Docket Number: No. 96-0198,96-0198
• Citation: 925 S.W.2d 656
• Parties: 39 Tex. Sup. Ct. J. 1052 Michael MANTAS, M.D., a/k/a Michael Mantas, Mike Mantas, Dr. Michael Mantas d/b/a the Furniture Store and the Cowboy Furniture Store, Relators, v. THE FIFTH COURT OF APPEALS, Respondent.
• Court: Texas Supreme Court

Page 656

925 S.W.2d 656

39 Tex. Sup. Ct. J. 1052

Michael MANTAS, M.D., a/k/a Michael Mantas, Mike Mantas, Dr Michael Mantas d/b/a the Furniture Store and the Cowboy Furniture Store, Relators, v. THE FIFTH COURT OF APPEALS, Respondent.

No. 96-0198.

Supreme Court of Texas.

July 12, 1996.

Ronald D. Wren, Bedford, for Relators.

Kendall Wayne Hill, Fort Worth, Lewis Benjam Barnett, Jr., Lewisville, J. Benjamin Barlow, Fort Worth, for Respondent.

PER CURIAM.

In this original mandamus proceeding, we must determine whether the court of appeals abused its discretion by refusing to summarily enforce a settlement agreement reached while the underlying case was on appeal. We hold that, because the appellee disputed the validity of the settlement agreement, the appellant was required to seek enforcement of the agreement in a separate action, subject to the normal rules of pleading and proof. The court of appeals thus did not abuse its discretion in this regard. We further conclude, however, that the court of appeals did abuse its discretion by refusing to abate the appeal while appellant sought enforcement of the settlement agreement, and that appellant lacks an adequate remedy by appeal. We conditionally grant mandamus relief on the abatement issue only.

Lewis Barnett obtained a judgment against Michael Mantas for $209,423 in July 1995, in a suit arising from a commercial dispute. Mantas timely perfected an appeal and posted a supersedeas bond for the amount of the judgment and interest. The court of appeals ordered the parties to mediation, where they reached and signed a settlement agreement. On December 8, 1995, pursuant to the settlement agreement, Mantas issued a check to Barnett and his attorneys for $160,000 in full satisfaction of the judgment, and Barnett signed a release of judgment, a joint motion to dismiss the appeal, and an agreed order dismissing the appeal.

Later that same day, before any documents were filed with the court of appeals, Barnett withdrew his consent to the settlement, revoking Mantas' authority to file the settlement documents on Barnett's behalf. While there is no dispute that the $160,000 settlement check was negotiated, Barnett contends that his attorneys, who no longer represented him, cashed the check without his authorization, collected their fee from the proceeds, and remitted the balance to the State Comptroller to pay back taxes allegedly owed by Barnett. The $160,000 has never been returned to Mantas.

Mantas moved in the court of appeals to enforce the settlement agreement. He asked the court to 1) declare the settlement agreement and release of judgment to be valid and enforceable, 2) dismiss the appeal with prejudice, and 3) release Mantas' supersedeas bond. Mantas alternatively asked the court to order Barnett to return the $160,000. The court of appeals denied Mantas' motion to enforce the settlement agreement, relying on Cadle Co. v. Castle, 913 S.W.2d 627 (Tex.App.--Dallas 1995, writ denied). That case held that enforcement of a disputed settlement agreement, even if reached at court-ordered mediation, must be determined in a breach-of-contract cause of action under normal rules of pleading and evidence.

Mantas consequently filed a separate suit, which is still pending, in district court to enforce the settlement agreement. Mantas then asked the court of appeals to abate the appeal pending resolution of the enforcement suit, but the court of appeals denied this request. ¹

Mantas seeks mandamus relief compelling the court of appeals to enforce the settlement agreement, or alternatively to abate the appeal pending resolution of the enforcement suit. We granted temporary relief staying the proceedings in the court of appeals pending our consideration of the merits.

Mantas argues that, because he has paid $160,000 in settlement which has not been returned, the settlement agreement must be enforced. He contends that it is fundamentally unfair to require him to continue prosecuting the appeal after he paid this amount to his opponent. Even if he prevails in the appeal, Mantas claims, he will probably not recover the payment from Barnett, whom he characterizes as judgment proof. Mantas thus concludes that he will be effectively denied his appellate rights.

Barnett responds that the settlement check was cashed without his authorization and that he personally received none of the money. Further, he seeks to assert affirmative defenses to the contractual settlement agreement, including fraud in the inducement, which he contends must be resolved in a separate enforcement...