McIntyre v. Wilson

• Decision Date: 22 June 2001
• Docket Number: No. 05-99-00094-CV,05-99-00094-CV
• Citation: 50 S.W.3d 674
• Parties: (Tex.App.-Dallas 2001) FRANK W. MCINTYRE, Appellant v. CHARLES M. WILSON III, JOHN SJOVALL, CLEVE CLINTON, JOHN PALTER, CRAIG FOWLER, STEVE L. SLIMAN, SLS CONSULTING, INC., AND GEARY & SPENCER, P.C., Appellees
• Court: Texas Court of Appeals

Page 674

50 S.W.3d 674 (Tex.App.-Dallas 2001)

FRANK W. MCINTYRE, Appellant v. CHARLES M. WILSON III, JOHN SJOVALL, CLEVE CLINTON, JOHN PALTER, CRAIG FOWLER, STEVE L. SLIMAN, SLS CONSULTING, INC., AND GEARY & SPENCER, P.C., Appellees

No. 05-99-00094-CV

Court of Appeals of Texas, Dallas

June 22, 2001

On Appeal from the 162nd Judicial District Court Dallas County, Texas Trial Court Cause No. 97-10572-I

[Copyrighted Material Omitted]

[Copyrighted Material Omitted] Robert "Bob" Gammage, Charles E. Hampton, Austin, for Appellant.

Thomas J. Obrien, James L. Sowder, Wade Caven Crosenoe, Thompson, Coe, Cousins & Irons, L.L.P., Dallas, Shawn Malcolm McCaskill, Cowles & Thompson, Christopher William Holmes, John H. Cochran, P.C., Dallas, for Appellee.

Before Justices Whittington, James, and Roach

OPINION

Opinion By Justice Roach

This appeal involves the third lawsuit filed by appellant Frank W. McIntyre over the dissolution of his business partnership with appellee Steve L. Sliman. McIntyre sued appellees Charles W. Wilson III, John Slovall, Cleve Clinton, John Palter, Geary & Spencer, Craig Fowler, Sliman, and Sliman's business SLS Consulting, Inc., alleging various causes of action. In a series of interlocutory orders (ultimately made final), the trial court rendered judgment in favor of all appellees and against McIntyre. The trial court also imposed monetary sanctions against McIntyre and limited his ability to file new litigation against Geary & Spencer.

In eight issues on appeal, McIntyre challenges the trial court's judgment on the merits of his lawsuit as well as the orders sanctioning him and finding him to be a "vexatious litigant." For the reasons set forth below, we vacate the sanctions against McIntyre for filing a groundless lawsuit against Wilson and Fowler. We affirm the trial court's judgment in all other respects, including the sanctions awarded to appellees Clinton, Palter, and Geary & Spencer.

Background

In 1985, McIntyre and Sliman became partners in Nova Information Systems which sold and serviced users of the "trademark" product, "Open Systems Accounting Systems." Eight months later, Sliman withdrew from the partnership and started his own business, SLS Consulting, Inc., with partnership assets. McIntyre sued Sliman for breach of fiduciary duty, breach of contract, and wrongful termination of the partnership and sought damages and an accounting of partnership assets.¹ During the pendency of the lawsuit, McIntyre and Sliman agreed to submit the dispute to binding arbitration, and, after a five-day hearing, the arbitrator awarded McIntyre $40,235. The award was entered as a final judgment in the 162nd Judicial District Court in September 1990. No appeal was taken.

Thereafter, McIntyre sued his lawyers, Clinton, Palter, and Geary & Spencer, for legal malpractice in the partnership dissolution lawsuit, complaining that as a result of their acts and omissions, he did not get his fair share of partnership income.² In this second lawsuit, he alleged causes of actions for negligence, gross negligence, negligent misrepresentation, breach of fiduciary duty, deceptive trade practices, and fraud. Again, he sought damages and an accounting. A jury ultimately found in favor of Clinton, Palter, and Geary & Spencer on McIntyre's claims, and the trial court entered judgment on the jury's findings. McIntyre unsuccessfully appealed the judgment to this Court and the Texas Supreme Court.³

While the appeal was pending in the Texas Supreme Court, McIntyre filed the current lawsuit and named as parties all of the defendants in the two previous lawsuits as well as appellees Wilson and Fowler, who testified favorably for the defense in the malpractice lawsuit. His petition asserted many of the causes of actions alleged in the previous lawsuits. In addition, he alleged all the appellees, except Sliman, made false representations of law and fact to the jury while testifying as experts in the malpractice suit. Further, he asserted a cause of action against Sliman for spoliation of evidence, alleging Sliman intentionally destroyed business records reflecting the amount of money Sliman received from clients prior to the partnership termination. Finally, he sought to overturn the 1990 and 1996 judgments by bill of review and requested the court appoint an auditor to determine what Sliman owed him.

Each of the appellees moved for either summary judgment or dismissal of McIntyre's claims on various grounds. The trial court granted each motion, which ultimately resulted in a final take- nothing judgment against McIntyre. Moreover, in separate orders, the trial court found McIntyre's suit against Clinton, Palter, Geary & Spencer, Wilson, and Fowler was groundless and brought in bad faith and for purposes of harassment. The trial court ordered McIntyre to pay a sanction of $23,990 to Clinton, Palter, and Geary & Spencer, and a sanction of $6,000 to Wilson and Fowler. Finally, the trial court found McIntyre was a "vexatious litigant" and signed an order prohibiting him from filing any new litigation in Texas state or federal courts against Geary & Spencer without first obtaining the permission of the local administrative judge of the court where McIntyre intends to file the litigation.

In eight issues on appeal, McIntyre challenges the trial court's judgment on the merits of his lawsuit as well as the sanctions order and "vexatious litigant" order. Among the many issues we consider are whether (1) Texas law provides absolute immunity for a testifying expert, (2) McIntyre can maintain a spoliation cause of action against Sliman, and (3) McIntyre's failure to appeal the 1990 judgment and his unsuccessful appeal of the 1996 judgment preclude bill of review relief. In addition to these issues, McIntyre complains the "vexatious litigant" statute is unconstitutional and argues the sanction should be set aside because his lawsuit was not "groundless." We will address each of McIntyre's complaints, beginning with the trial court's ruling on the merits of his lawsuit.

Standard of Review

This Court reviews a summary judgment de novo to determine whether a party's right to prevail is established as a matter of law. Foreness v. Hexamer,±971 S.W.2d 525, 527 (Tex. App. -Dallas 1997, pet. denied). When reviewing a traditional summary judgment, we apply well- known standards. See Tex. R. Civ. P. 166a(c); McConnell v. Southside Indep. Sch. Dist., 858 S.W.2d 337, 341 (Tex. 1993); Black v. Victoria Lloyds Ins. Co., 797 S.W.2d 20, 23 (Tex. 1990); Nixon v. Mr. Prop. Mgmt. Co., 690 S.W.2d 546, 548-49 (Tex. 1985); Orozco v. Dallas Morning News, Inc., 975 S.W.2d 392, 394 (Tex. App. -Dallas 1998, no pet.). The party moving for summary judgment has the burden of showing no genuine issue of material fact exists and it is entitled to judgment as a matter of law. See Tex. R. Civ. P. 166a(c); Swilley v. Hughes, 488 S.W.2d 64, 67 (Tex. 1972).

Bills of Review

In his sixth, seventh, and eighth issues, McIntyre complains the trial court erred in granting summary judgment in favor of Sliman, Clinton, Palter, and Geary & Spencer on his petitions for bill of review. In particular, he complains the judgments in those cases are "inconsistent" and neither res judicata nor collateral estoppel should bar this lawsuit. We disagree.

A bill of review is an independent action to set aside a judgment that is no longer appealable or subject to challenge by a motion for new trial. Wembley Inv. Co. v. Herrera, 11 S.W.3d 924, 927 (Tex. 1999). Bill of review relief is available only if a party has exercised due diligence in pursuing all available legal remedies against a former judgment. Id., 11 S.W.3d at 927. If legal remedies were available but ignored, relief by equitable bill of review is not available. Id. Thus, a litigant who permits the judgment to become final by failing to invoke the right to appeal is not entitled to bill of review relief. See French v. Brown, 424 S.W.2d 893, 895 (Tex. 1967). Likewise, a bill of review may not be used as an additional remedy by a litigant who has made a timely but unsuccessful appeal. Rizk v. Mayad, 603 S.W.2d 773, 776 (Tex. 1980).

With respect to McIntyre's bill of review attack on the 1990 judgment in the partnership dissolution lawsuit, Sliman moved for summary judgment on the ground that McIntyre (1) did not appeal the judgment and (2) has not alleged extrinsic fraud. Further, he argued the relief is barred by the four-year statute of limitations. The summary judgment evidence establishes that McIntyre, although aware of the judgment, failed to appeal it. Consequently, he is not entitled to bill of review relief. See id., 603 S.W.2d at 776.

Furthermore, his petition for bill of review complains that Sliman concealed business records regarding partnership income. Because of his allegations, only extrinsic fraud will entitle McIntyre to bill of review relief. See Vickery v. Vickery, 999 S.W.2d 342, 367 (Tex. 1999). Extrinsic fraud denies a losing litigant the opportunity to fully litigate his rights upon trial. Id. It requires proof of some deception practiced by the adverse party, collateral to the underlying action. Id. Intrinsic fraud is inherent in the matter considered and determined in the trial, where the fraudulent acts pertain to an issue involved in the original action, or where the acts constituting the fraud were or could have been litigated therein. Id. Intrinsic fraud includes false testimony, fraudulent instruments, and any matter actually presented to and considered by the court in rendering the judgment assailed. Id.

Here, McIntyre complains that Sliman concealed business records and provided false tax returns that misreported his income. These allegations are not collateral to the matter, but were the very essence of his lawsuit which sought his share of partnership profits. Consequently, we conclude McIntyre has alleged intrinsic fraud, which does not entitle him to bill of review relief. Acc...