Pelt v. State Bd. of Ins.

Decision Date19 December 1990
Docket NumberNo. 3-89-065-CV,3-89-065-CV
PartiesJohn Henry PELT, et al., Appellants, v. The STATE BOARD OF INSURANCE, Appellee.
CourtTexas Court of Appeals
Concurring Opinion of Justice Powers Jan. 9, 1991.

Joseph C. Deming, DeLeon, Boggins & Richards, Austin, for appellants.

Jim Mattox, Atty. Gen., Anna E. Gonzales, Asst. Atty. Gen., Finance Div., Austin, for appellee.


ABOUSSIE, Justice.

This appeal arises from a district court order rendered in connection with an administrative proceeding pending before the Texas Commissioner of Insurance. Appellee served a subpoena duces tecum on the president of a non-party bank directing him to appear and produce documents at a hearing involving appellants. Appellants then filed a motion in the district court seeking to quash the subpoena. Tex.Rev.Civ.Stat.Ann. art. 342-705, § 3 (Supp.1991). After a hearing, the court overruled appellants' motion, and they now seek to appeal the trial court's order denying the motion to quash. At the outset, we must determine whether the order challenged is a final judgment reviewable by appeal. All of the parties apparently consider it so, although no one directs us to the basis authorizing an appeal. We conclude, however, that the order is not subject to appeal and dismiss the appeal for want of jurisdiction.

Appellants are the respondents in an administrative proceeding pending before the Commissioner of Insurance in which the agency is considering possible disciplinary action against them. Appellants received notice that the Insurance Board had requested issuance of a subpoena and subpoena duces tecum to Harold Blake, President of Redbird Bank of Dallas, pursuant to the Administrative Procedure and Texas Register Act (APTRA), Tex.Rev.Civ.Stat.Ann. art. 6252-13a, § 14(c) (Supp.1991). In response to the request, the Insurance Commissioner issued the subpoena, and Blake was ordered to appear at a disciplinary hearing March 13, 1989, and to produce the following documents:

Monthly transaction statements, or any kind or type of summary of transactions evidencing deposits, withdrawals, wire transfers from the demand deposit accounts, savings accounts, and trust accounts; and records evidencing certificates of deposits, letters of credit, or indebtedness for accounts in the name of Aztec, Aztec General Agency, Aztec Surplus Lines Agency, Aztec Insurance Agency or American Surety Company, John Henry Pelt or John Kyle Pelt from October of 1986 through and including January 1989.

Neither Blake nor the bank challenged or resisted the subpoena, and they are not parties to this appeal.

Pursuant to art. 342-705, § 3 of the Texas Banking Code, appellants filed in the district court a pleading entitled Motion to Quash Subpoena Duces Tecum challenging the authority of the State Board of Insurance to obtain disclosure of the requested bank records. The original motion was not verified as required, but a verified amended motion was filed before the date ordered for production. In turn, appellee filed a response to the motion and an application to enforce the subpoena. After a hearing, the district court signed an order stating only that, "the Court considered [appellants' ] Motion to Quash ..., and the Court is of the opinion that said motion should be denied." Appellants seek to appeal this order. The trial court did not order any party, the bank or Blake to take any action and did not compel discovery or production. Indeed, the trial court did not rule upon appellee's request for enforcement, except by implication, although the result was to leave the subpoena in effect.

We are required to determine this Court's jurisdiction to decide the appeal, even when the issue is not raised by a party. Zoning Bd. of Adjustment v. Graham & Assoc., Inc., 664 S.W.2d 430, 433 (Tex.App.1983, no writ); City of Beaumont v. West, 484 S.W.2d 789, 791 (Tex.Civ.App.1972, writ ref'd n.r.e.); Gibbs v. Melton, 354 S.W.2d 426, 428 (Tex.Civ.App.1962, no writ); Newton v. Barnes, 150 S.W.2d 72 (Tex.Civ.App.1941, writ ref'd). This Court has jurisdiction over "all cases of which the district courts or county courts have original or appellate jurisdiction...." Tex. Const.Ann. art. V, § 6 (Supp.1991). A necessary prerequisite to invoking the jurisdiction of the court of appeals is that, in the absence of a statute to the contrary, the appeal must be from a final, appealable judgment. Hinde v. Hinde, 701 S.W.2d 637, 639 (Tex.1985); North East Indep. School Dist. v. Aldridge, 400 S.W.2d 893 (Tex.1966); Tingley v. Northwestern Nat'l Ins. Co., 712 S.W.2d 649, 650 (Tex.App.1986, no writ); Tex.Civ.Prac. & Rem.Code Ann. § 51.012 (1986). Thus, we have no jurisdiction over an appeal from a trial court's interlocutory ruling unless such order is specifically made appealable by statute. Cherokee Water Co. v. Ross, 698 S.W.2d 363, 365 (Tex.1985); Henderson v. Shell Oil Co., 143 Tex. 142, 182 S.W.2d 994, 995 (1944); Grant v. Austin Bridge Const. Co., 725 S.W.2d 366, 368 (Tex.App.1987, no writ). See Tex.Civ.Prac. & Rem.Code Ann. § 51.014 (Supp.1991).

An appellant should be accorded a reasonable and liberal interpretation of the rules and requirements of appellate review. Salvaggio v. Brazos County Water Control & Improvement Dist. No. 1, 598 S.W.2d 227, 229 (Tex.1980). Notwithstanding the rule favoring appealability, however, we are unable to conclude that this appeal is from a final judgment subject to appeal at this time. In essence, the appeal is from an order relating to a discovery dispute between the board and appellants. Trial courts routinely rule upon discovery matters during the course of litigation. Indeed, a court may entertain an action filed for the sole purpose of obtaining discovery or preserving evidence. See Tex.R.Civ.P.Ann. 166b, 167, 187, 215a, 621a, 737 (1976 & 1990 Supp.). A discovery order generally is interlocutory in nature and not immediately appealable as a final judgment. If the information sought to be divulged is not discoverable, the order can be set aside on writ of mandamus. McElroy, 26 Texas Practice, Civil Pre-Trial Procedure, § 1528 (1985). In one context, courts have described discovery orders as follows:

There are two types of discovery. One is made in aid of a pending suit and is sometimes referred to as a pure bill of discovery. Such an order is interlocutory in nature and is not appealable. The other type is in aid of a final judgment. It is a separate suit and is often referred to as a suit in the nature of a bill of discovery. This type of order is itself a final judgment and is appealable.

South Falls Corp. v. Davenport, 368 S.W.2d 695, 696-97 (Tex.Civ.App.1963, no writ) (and citations therein.)

APTRA § 14(c) grants administrative agencies authority to issue subpoenas to require attendance of witnesses and production of information. Section 14(n) provides that, in the event of failure to comply, the agency or party requesting discovery may bring suit to enforce the agency subpoena in district court. Failure to obey the trial court's enforcement order is punishable by contempt.

The Insurance Code grants the commissioner and board statewide subpoena power to compel attendance of witnesses and production of information. Tex.Ins.Code Ann. 1.19-1(a) (Supp.1991). In the event of disobedience, the commissioner or board may invoke the aid of a district court, and the court may issue an order requiring obedience to the subpoena and compelling production in accordance therewith. Failure to obey the court's order is punishable by contempt. Tex.Ins.Code Ann. 1.19-1(c) (Supp.1991).

Under article 342-705, § 1 of the Banking Code, a financial institution cannot be required to produce a customer's records, except as therein provided, although it is not forbidden from doing so voluntarily. Nicewander, Financial Record Privacy--What Are and What Should Be the Rights of the Customer of a Depository Institution, 16 St. Mary's L.J. 601, 603 (1985). Section 3 provides that a depositor who seeks to resist that production may file in a district court a verified motion to quash the subpoena or seek a protective order. Tex.Rev.Civ.Stat.Ann. art. 342-705, § 3 (Supp.1991).

None of the above statutes expressly provide for a right of appeal from the district court order therein contemplated. Pursuant to these and other statutes, the district court regularly is called upon to rule upon discovery disputes before the many state administrative agencies, in light of the fact that an agency's interlocutory discovery orders generally are not appealable. APTRA § 19(a); Hamilton & Jewett, The Administrative Procedure and Texas Register Act: Contested Cases and Judicial Review, 54 Texas L.Rev. 285, 303 (1976). While a proceeding filed for this purpose in district court is an original action and not an appeal from an agency order, relief from the trial court is sought with respect to an agency's discovery ruling in connection with a matter ongoing in the agency.

It has long been held that a discovery order is interlocutory in nature and therefore non-appealable, in the absence of express statutory authority, until after final judgment may be rendered on the merits of the primary dispute. Office Employees Int'l Union v. Southwestern Drug Corp., 391 S.W.2d 404, 407 (Tex.1965); Southern Bag & Burlap Co. v. Boyd, 120 Tex. 418, 38 S.W.2d 565, 569 (1931); Texas Wheat Growers' Ass'n v. Gough, 70 S.W.2d 818, 819 (Tex.Civ.App.1934, writ ref'd).

As a general rule, then, orders relating to discovery in aid of a pending or contemplated cause, even when filed in a separate action, are considered interlocutory and are not appealable except in connection with appeal upon final disposition of the main cause on the merits. Equitable Trust Co. v. Jackson, 101 S.W.2d 552, 553 (Tex.1937); Warford v. Childers, 642 S.W.2d 63, 65 (Tex.App.1982, no writ); Itz v. Kunz, 511 S.W.2d 77 (Tex.Civ.App.1974, writ ref'd n.r.e.). This is in...

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