Sullivan v. Abraham

• Decision Date: 15 April 2016
• Docket Number: No. 14–0987,14–0987
• Citation: 488 S.W.3d 294
• Parties: Michael Quinn Sullivan, Petitioner, v. Salem Abraham, Respondent
• Court: Texas Supreme Court

488 S.W.3d 294

Michael Quinn Sullivan, Petitioner,

v.Salem Abraham, Respondent

No. 14–0987

Supreme Court of Texas.

Argued January 14, 2016

Opinion delivered: April 15, 2016

Charles Gerard Harrison, Houston, for Amicus Curiae Art, Martinez de Vara.

James Edwin Trainor, III, Beirne, Maynard & Parson, L.L.P., Austin, Kelly H. Leonard, Strasburger & Price, LLP, N. Terry Adams, Jr., Joseph M. Nixon, Beirne, Maynard & Parsons, L.L.P., Houston, for Petitioner Michael Quinn Sullivan.

Courtney D'lynn Miller, John H. Lovell, Lovell, Lovell, Newsom & Isern, L.L.P., John T. Smithee, Templeton, Smithee, Hayes, Heinrich & Russell LLP, Amarillo, for Respondent Salem Abraham.

Justice Devine

delivered the opinion of the Court.

The Texas Citizens Participation Act provides for the expedited dismissal of a legal action that implicates a defendant's right of free speech or other First Amendment right when the party filing the action cannot establish the Act's threshold requirement of a prima facie case. Tex. Civ. Prac. & Rem. Code § 27.005

. A successful motion to dismiss under the Act entitles the moving party to an award of court costs, reasonable attorney's fees, and other expenses incurred in defending against the legal action. Id . § 27.009(a). The trial court in this case granted the motion and awarded these costs, fees, and expenses. The prevailing party was dissatisfied with the award, however, and appealed, arguing that it did not conform to the statute's requirements. The court of appeals affirmed. 472 S.W.3d 677 (Tex.App.—Amarillo 2014). Because the courts below used the wrong standard in determining the attorney's fees part of the award, we reverse and remand.

I

Salem Abraham sued Michael Quinn Sullivan for defamation. Sullivan generally denied the claim and moved to dismiss the suit under the Texas Citizens Participation Act (TCPA). The TCPA provides an expedited procedure for the dismissal of certain legal actions directed at a party's free speech or other First Amendment right. See Tex. Civ. Prac. & Rem. Code §§ 27.001

–.011. If the court orders dismissal, the Act further provides for the award of court costs, attorney's fees, and other expenses, as well as sanctions “sufficient to deter” future “similar actions.” Id . § 27.009(a).

Under this provision, Sullivan requested $67,290.00 in attorney's fees, $4,381.01 in costs and expenses, and sanctions. After a hearing on Sullivan's motion, the trial court issued a letter ruling, granting dismissal and announcing “that justice and equity necessitate Defendant's recovery of reasonable attorney's fees in the amount of $6,500.00 and costs in the amount of $1,500.00.” The court also denied sanctions in the letter ruling. The court thereafter signed its formal order, clarifying that the $1,500.00 identified in the letter ruling was for expenses and that Sullivan should also recover court costs. Although the judgment generally favored Sullivan, he nevertheless appealed to challenge the inadequacy of the court's award of attorney's fees and expenses, and the court's failure to award sanctions.

The court of appeals affirmed the trial court's award of attorney's fees and expenses, but reversed and remanded for the trial court to reconsider its decision to deny sanctions. 472 S.W.3d at 683

. The appellate court concluded that the TCPA made an award of sanctions mandatory but tempered “the quantum or extent of the sanction ... by what the trial court ‘determines sufficient’ ” to deter similar actions. Id . (citing Tex. Civ. Prac. & Rem. Code § 27.09(a)(2)). The court further concluded the TCPA required an award of “reasonable attorney's fees” but also conferred on the trial court discretion to award a lesser amount if “justice and equity” so required. Id . at 681–82. The appellate court's analysis purported to follow Bocquet v. Herring, 972 S.W.2d 19 (Tex.1998), a case that involved an award of attorney's fees under the Declaratory Judgments Act. Id . at 681. Sullivan perfected an appeal to this Court; Abraham did not.

II

Sullivan argues the court of appeals' reliance on Bocquet

is misplaced because attorney's fees are determined differently under the Declaratory Judgments Act than under the TCPA. Sullivan submits that a fee award under the TCPA is mandatory and measured simply by reasonableness, whereas a fee award under the Declaratory Judgments Act is permissive and subject to four express limitations—that it be “reasonable and necessary” and also “equitable and just.” Compare Tex. Civ. Prac. & Rem. Code § 27.009(a)(1), with id . § 37.009.

We agree the two statutes are different. The Declaratory Judgments Act provides:

In any proceeding under this chapter, the court may award costs and reasonable and necessary attorney's fees as are equitable and just.

Id. § 37.009. The TCPA, by comparison, provides in relevant part:

(a) If the court orders dismissal of a legal action under this chapter, the court shall award to the moving party: (1) court costs, reasonable attorney's fees, and other expenses incurred in defending against the legal action as justice and equity may require; and (2) sanctions ...

Id. § 27.009(a). The distinctions noted by Sullivan are there, but the respective statutes also both incorporate notions of justice and equity.

In Bocquet,

we concluded that section 37.009 of the Declaratory Judgments Act imposed four limitations on the court's discretion to award attorney's fees, requiring a multi-faceted appellate review because the limitations involved both evidentiary and discretionary matters. Bocquet, 972 S.W.2d at 21. In describing this review, we said:

Therefore, in reviewing an attorney fee award under the Act, the court of appeals must determine whether the trial court abused its discretion by awarding fees when there was insufficient evidence that fees were reasonable and necessary, or when the award was inequitable or unjust. Unreasonable fees cannot be awarded, even if the court believed them just, but the court may conclude that it is not equitable or just to award even reasonable and necessary fees.

Id.

Borrowing from this analysis, the court of appeals here concludes that attorney's fees under the TCPA similarly “can be no more than what is reasonable but may be less than that in view of pertinent considerations of justice and equity.” 472 S.W.3d at 681–82. The court's analysis thus assumes that limitations of “justice and equity” apply to attorney's fees under the TCPA and that the trial court therefore possessed the discretion to award something less than a reasonable attorney's fee.

Sullivan complains that the court's analysis is incorrect because considerations of “justice and equity” under the TCPA only apply to the trial court's award of “other expenses,” and not to “reasonable attorney's fees.” He submits the provision's grammatical structure confirms this construction. Abraham argues to the contrary, but also responds that Sullivan waived this argument by not raising it below. We disagree.

Although Sullivan has further refined his argument in this Court, his complaint in the court of appeals was adequate to preserve the issue for our review. See Weeks Marine, Inc. v. Garza , 371 S.W.3d 157, 162 (Tex. 2012)

(“Appellate courts must treat the statement of an issue ‘as covering every subsidiary question that is fairly included.’ ”) (quoting Tex. R. App. P. 38.1(f) ). In the court of appeals, Sullivan argued entitlement to all his costs and reasonable attorney's fees, thus rejecting the notion that the trial court possessed discretion to adjust the amount of reasonable attorney's fees “as justice and equity may require.” We turn then to the statutory text.

The parties rely on different canons of statutory construction to advance their respective positions. Abraham relies on the series-qualifier canon, which provides that “[w]hen there is a straightforward, parallel construction that involves all nouns or verbs in a series, a prepositive or postpositive modifier normally applies to the entire series.” Antonin Scalia & Bryan A. Garner, Reading Law: the Interpretation of Legal Texts 147 (2012). Under this canon, the phrase “as justice and equity may require” would modify all three items in the series.

By contrast, Sullivan relies on the last-antecedent canon, which provides “that a qualifying phrase in a statute or the Constitution must be confined to the words and phrases immediately preceding it to which it may, without impairing the meaning of the sentence, be applied.” Spradlin v. Jim Walter Homes, Inc., 34 S.W.3d 578, 580 (Tex.2000)

. Under this canon, the phrase “as justice and equity may require” would only modify the last item in the series.

Either canon might reasonably apply to this text, but they cannot both apply because they point in different directions. And thus, without more, neither aids in our understanding of the statute. Sullivan, however, also argues that the Legislature's use of punctuation confirms his reading of the statute.

“Punctuation is a permissible indicator of meaning.” Scalia & Garner , supra at 161 (citing United States Nat'l Bank of Or. v. Indep. Ins. Agents of Am., Inc., 508 U.S. 439, 454, 113 S.Ct. 2173, 124 L.Ed.2d 402 (1993)

). Indeed, punctuation “will often determine whether a modifying phrase or clause applies to all that preceded it or only to a part.” Id. Thus, “[p]roperly placed commas [c]ould cancel the last antecedent canon” and vice versa. Id. Scalia and Garner offer the following example:

“You will be punished if you throw a party, or engage in any other activity, that damages the house.” Id . The comma after “activity” does substantial work: It signals that the phrase “that damages the house” modifies both “party” and “any other activity.” Id . at 162. Absent the comma after “activity,” the last-antecedent canon would be triggered and the phrase “that damages the house” would modify only “any other activity.” Id .

Applying this example to the statutory text here, the insertion of a comma before “as justice and equity may...