Quaestor Investments, Inc. v. State of Chiapas

• Citation: 997 S.W.2d 226
• Parties: (Tex. 1999) QUAESTOR INVESTMENTS, INC., PETITIONER v. STATE OF CHIAPAS, A STATE OF THE UNITED MEXICAN STATES, RESPONDENT NO. 98-0835
• Decision Date: 01 July 1999
• Court: Supreme Court of Texas

Page 226

997 S.W.2d 226 (Tex. 1999)

QUAESTOR INVESTMENTS, INC., PETITIONER v. STATE OF CHIAPAS, A STATE OF THE UNITED MEXICAN STATES, RESPONDENT

NO. 98-0835

IN THE SUPREME COURT OF TEXAS

July 1, 1999

Rehearing Overruled August 26, 1999

ON PETITION FOR REVIEW FROM THE COURT OF APPEALS FOR THE FIRST DISTRICT OF TEXAS

Per Curiam

With fourteen days remaining in its six-month window to appeal a default judgment by writ of error, the State of Chiapas removed this case to federal district court. The federal district court remanded to state district court pursuant to 28 U.S.C. 1447(c). Approximately eight months later, Chiapas filed its petition for writ of error. Quaestor Investments, Inc., moved to dismiss for want of jurisdiction, arguing that the petition for review was not timely filed. Thus, the question in this case is when did the appellate timetable recommence after remand? The court of appeals held that the timetable did not recommence until the party seeking remand had given notice to the other party in the case. 982 S.W.2d 144. We disagree and hold that the appellate timetable recommences upon the revesting of jurisdiction in the state court, which occurs when the federal district court executes the remand order and mails a certified copy of the remand order to the state court. We conclude in this case that the State of Chiapas failed to file its petition for writ of error within the time frame provided by the Texas Rules of Appellate Procedure, and accordingly vacate the judgment of the court of appeals and dismiss the appeal.

During the mid-1980s, Quaestor Investments, Inc., a Texas corporation, purchased coffee from cooperatives located in the State of Chiapas, a State of the United Mexican States. After conflicts in their business relationship, Quaestor sued the cooperatives in a Texas district court in 1986. The cooperatives did not answer, and the court granted a default judgment for Quaestor.

In March 1994, Quaestor sued the State of Chiapas, alleging fraud and conspiracy to prevent Quaestor from executing the default judgment on the cooperatives' assets. Chiapas did not answer. On April 19, 1995, the court granted a default judgment for Quaestor, and in May 1995, Quaestor began proceedings to collect on its judgment.

On October 5, 1995, Chiapas removed the lawsuit to federal court pursuant to 28 U.S.C. 1441(d). The federal district court ruled that the removal was untimely and on December 28, 1995, remanded the case to state court pursuant to 28 U.S.C. 1447(c). On February 2, 1996, Chiapas appealed the remand order to the United States Court of Appeals for the Fifth Circuit, which dismissed the appeal for want of jurisdiction on August 16, 1996.

On August 29, 1996, Chiapas filed a petition for writ of error to the court of appeals.¹ Quaestor moved the court to dismiss Chiapas's petition for writ of error as untimely. The court of appeals overruled Quaestor's motion to dismiss and later reversed the default judgment and remanded the case to the trial court. 982 S.W.2d at 146. Quaestor petitioned for review of the court of appeals' judgment, complaining about the denial of its motion to dismiss.

The four elements necessary for review by writ of error are: (1) the petition must be brought within six months of the date of judgment; (2) by a party to the suit; (3) who did not participate in the trial; and (4) error must be apparent from the face of the record. See Stubbs v. Stubbs, 685 S.W.2d 643, 644 (Tex. 1985). The six-month time limit is mandatory and jurisdictional. See Linton v. Smith, 154 S.W.2d 643, 645 (Tex. 1941).

Quaestor does not contest that filing the removal suspended the appellate timetable. And Chiapas acknowledges that when it removed the case to federal court on October 5, 1995, it had fourteen days left to file its petition for writ of error. Thus, the only issue presented is when the appellate timetable began to run again.

Quaestor argues that the timetable recommenced when the federal district court entered its remand order (December 28, 1995) or when the state court acknowledged receipt of the remand order (January 10, 1996). Chiapas responds that the timetable recommenced when the Fifth Circuit dismissed the appeal of the remand order (August 16, 1996) or when Chiapas mailed a copy of the remand order to the state district clerk (September 6, 1996). Either of Chiapas' dates would make its August 29, 1996 writ of error appeal timely while either of Quaestor's dates would make the appeal untimely.

The court of appeals determined that the state court reacquired jurisdiction on the date the federal court clerk mailed a certified copy of the remand order to the state court clerk. The court further concluded that when the appellate timetable recommenced was determined not by the revesting of jurisdiction, but rather depended upon the procedural implications of that revesting under Texas law. The court looked to Texas procedural rules for its answer: (1) Rule of Civil Procedure 237a, which provides that a defendant need not answer in a remanded case until fifteen days after the plaintiff files the remand order with the state court and gives written notice of the filing to the adverse parties' attorneys; and (2) current Rule of Appellate Procedure 8, which provides that affirmative action is required by a party or the court to reinstate an appeal stayed by a bankruptcy proceeding. Concluding that these rules require affirmative action before procedural timetables restart, the court similarly determined that the appellate timetable should not recommence until the party seeking remand acts affirmatively by giving notice to the other party. While we agree with the court of appeals' determination of when state court jurisdiction revested, we disagree that we must look any further than that date to determine when the timetable for filing a writ of error appeal began to run again.

Remanding a case to state court terminates the jurisdiction of a federal district court over that case. See Hunt v. Acromed Corp., 961 F.2d 1079, 1081 (3d Cir. 1992); Browning v. Navarro, 743 F.2d 1069, 1078 (5th Cir. 1984). There is no requirement that the state court take any action (e.g., entering the order in the state court docket) to reassert jurisdiction. See Mathewson v. Aloha Airlines, Inc., 919 P.2d 969, 985-86 (Haw. 1996). In answering the question of when a jurisdictional transfer occurs between federal and state court, most courts, including the court of appeals in this case, have looked to 28 U.S.C. 1447(c), which provides, in part, that: "A certified copy of the order of remand shall be mailed by the clerk to the clerk of the State court. The State court may thereupon proceed with such case." These courts have interpreted this language to mean that the federal court loses jurisdiction once the federal court clerk has mailed a certified copy of the remand order to the state court clerk. See McClelland v. Gronwaldt, 155 F.3d 507, 513 & n.15 (5th Cir. 1998); Trans Penn Wax Corp. v. McCandless, 50 F.3d 217, 225 (3d Cir....