Young v. Kirsch

• Decision Date: 12 June 1991
• Docket Number: No. 04-90-00533-CV,04-90-00533-CV
• Citation: 814 S.W.2d 77
• Court: Texas Court of Appeals
• Parties: James B. YOUNG, Appellant, v. Raymond R. KIRSCH, Appellee.

Page 77

814 S.W.2d 77

James B. YOUNG, Appellant, v. Raymond R. KIRSCH, Appellee.

No. 04-90-00533-CV.

Court of Appeals of Texas,

San Antonio.

June 12, 1991.

Angelini, Karen A., Brock & Mathis, P.C., San Antonio, for appellant.

Patton, Timothy, Pozza & Patton, Michael A. Chovanec, R. Wes Johnson, Chovanec & Johnson, Inc., San Antonio, for appellee.

EN BANC.

OPINION

CHAPA, Justice.

This court, sitting en banc on its own motion, considers the appeal of appellant, James B. Young, from a default judgment rendered in favor of appellee, Raymond R. Kirsch, and the trial court's denial of a motion for new trial. TEX.R.APP.P. 79.

The issues before this court are whether the trial court erred:

1) in denying the motion for new trial;

2) in granting the default judgment when the evidence was legally and factually insufficient to support the default judgment;

3) in rendering the default judgment where the appellee's petition "did not support the judgment"; and,

4) in rendering the default judgment where appellee's petition "did not properly allege Defendant's residence."

On November 20, 1987, Young and Kirsch were involved in an auto accident in San Antonio, Texas. Plaintiff Kirsch's property damage claim was paid, and the claim file was eventually closed. On November 16, 1989, Kirsch filed a lawsuit against Young for personal injury damages. Young was eventually served with suit papers in Boca Raton, Florida on January 24, 1990. Young forwarded these suit papers to his insurance carrier's office in Houston, Texas by regular mail upon his agent's instructions. No answer was filed prior to the default judgment being rendered. Default judgment was taken on May 23, 1990. Young filed a motion for new trial, along with affidavits which set forth facts allegedly entitling him to a new trial. Craddock v. Sunshine Bus Lines, 134 Tex. 388, 133 S.W.2d 124, 126 (1939). Although no controverting affidavits were filed by the appellee, depositions, as well as live testimony, were presented to the court at a hearing held on appellant's motion for new trial. ¹ Appellant's motion was denied, and judgment was rendered for appellee Kirsch in the amount of $350,000.

Initially, appellant contends that the trial court erred in overruling Young's motion for new trial.

In Craddock, the Texas Supreme Court established the guiding rule to be applied in determining whether a new trial should be granted:

A default judgment should be set aside and a new trial ordered in any case in which the failure of the defendant to answer before judgment was not intentional, or the result of conscious indifference on his part, but was due to a mistake or an accident; provided the motion for a new trial sets up a meritorious defense and is filed at a time when the granting thereof will occasion no delay or otherwise work an injury to the plaintiff.

Craddock, 133 S.W.2d at 126.

The appellant argues that the default judgment should have been set aside and a new trial granted because his failure to file an answer was due to accident or mistake and not conscious indifference; further, appellant contends that he demonstrated a meritorious defense and established that the granting of a new trial would occasion no delay and injury. Notwithstanding appellant's assertions, the question of whether the trial court erred in denying a motion for new trial is "directed to the sound discretion of the trial court." Craddock, 133 S.W.2d at 126. "[T]he court's ruling on such will not be disturbed on appeal in the absence of a showing of an abuse of that discretion." Cliff v. Huggins, 724 S.W.2d 778, 778 (Tex.1987).

However, the trial court's discretion is more limited with regard to the meritorious defense prong of Craddock. Craddock, 133 S.W.2d at 126. When the movant "has thus set forth such meritorious defense, supported by such affidavits or other evidence as prima facie to entitle him to a new trial, such new trial should not be denied upon any consideration of counter affidavits or contradictory testimony offered in resistance to such motion." Cragin v. Henderson County Oil Dev. Co., 280 S.W. 554, 555 (Tex.Com.App.1926, holding approved). Likewise, "[w]here factual allegations in a movant's affidavits are not controverted, a conscious indifference question must be determined in the same manner as a claim of meritorious defense" and "[i]t is sufficient that the movant's motion and affidavits set forth facts which, if true, would negate intentional or consciously indifferent conduct." Strackbein v. Prewitt, 671 S.W.2d 37, 38-39 (Tex.1984). ²

Appellant misplaces his reliance on Strackbein for the proposition that appellee's failure to present controverting affidavits in response to appellant's motion for new trial and supporting affidavits requires the trial court to grant a new trial, regardless of any other evidence which may have been presented at the hearing. Although appellant concedes the Texas Supreme Court did not specifically state that only affidavits could be considered by the court, appellant, nevertheless, insists that this is the proper interpretation of Strackbein. We disagree.

In Strackbein, the only evidence before the trial court was the affidavits presented in support of the motion for new trial, which, if true, negated intentional or consciously indifferent conduct and set up a meritorious defense. Strackbein, 671 S.W.2d at 39. The supreme court expressly stated that "a conscious indifference question must be determined in the same manner as a claim of meritorious defense" "[w]here factual allegations in a movant's affidavits [as to conscious indifference] are not controverted"; "the trial judge, in considering the motion for new trial, [can] look only to the record before him at that time which include[s] [the movant's] motion for new trial and the affidavits submitted therewith." Id. at 38. As recognized by the appellant, the court did not require that the movant's affidavits be controverted only by counter affidavits, or that the trial court ignore any other evidence. Indeed, appellate courts have used the term "affidavits or other evidence" repeatedly when addressing the issue of setting aside a default judgment on the basis of conscious indifference, which must necessarily include documents, depositions, and testimony. Ivy v. Carrell, 407 S.W.2d 212, 214 (Tex.1966) (emphasis added); Cragin, 280 S.W. at 555; Russell v. Northeast Bank, 527 S.W.2d 783, 788 (Tex.Civ.App.--Houston [1st Dist.] 1975, writ ref'd n.r.e.). Accordingly, our decision must rest on whether the trial judge abused his discretion in denying appellant's motion for new trial in view of "the record before him at that time" which in this case not only included appellant's affidavits, but also depositions and testimony presented by the appellee controverting appellant's affidavits as to the issue of conscious indifference. Strackbein, 671 S.W.2d at 38.

In a supplemental brief, appellant cites this court's opinion in Peoples Sav. & Loan Ass'n v. Barber, 733 S.W.2d 679, 681 (Tex.App.--San Antonio 1987, writ dism'd by agr.), which appellant says supports his contention that this court should not consider any evidence adduced at the evidentiary hearing other than the affidavits or counter affidavits filed. However, the supreme court granted writ in Peoples Sav. & Loan Ass'n on the following point:

The Court of Appeals erred in reversing the trial court's proper denial of Respondents' Motion for New Trial, because, evidence, which was properly considered, controverted Respondents' allegation that their failure to answer was the result of accident or mistake, which evidence supports the trial court's finding of fact that Respondents' failure to answer was intentional or the result of conscious indifference.

31 Tex.Sup.Ct.J. 9 (October 10, 1987). But by agreement of the parties, the writ was dismissed.

We hereby disapprove of the language in Peoples Sav. & Loan Ass'n, or any other prior opinion by this court, which suggests that evidence adduced at a hearing to set aside a default judgment, other than affidavits or counter affidavits, may not be considered by the trial court, in determining whether the failure to answer was intentional or the result of conscious indifference, or by the appellate court, in determining whether the trial court abused its discretion.

As such, we find that the evidence properly before the trial court at the hearing on the motion for new trial reflects the following: suit was filed by Kirsch on November 16, 1989; Young was served with citation on or about January 24, 1990; although an answer was due on February 20, 1990, no answer was filed; Young failed to take any action at all until February 26, 1990, thirty-three days after he was served, at which time Young contacted his insurance carrier in San Antonio and notified it of the lawsuit; Kirsch, through his counsel, phoned Young on at least four different occasions, notifying Young that no answer had been filed; between April 17, 1990, when Young phoned his insurance company for the second and last time, and the time the default judgment was entered, Young took no other action; and, on May 23, 1990, four months after Young was originally served, the default judgment was entered. Additionally, there was testimony that Young had previously been employed for twenty years as a stockbroker and manager, and that while so employed, he had been sued on several occasions.

Appellant contends that his actions do not amount to conscious indifference. Conscious indifference has been defined as "the failure to take some action which would seem indicated to a person of reasonable sensibilities under the same or similar circumstances". Sunrizon Homes, Inc. v. Fuller, 747 S.W.2d 530, 532 (Tex.App.--San Antonio 1988, writ denied); Johnson v. Edmonds, 712 S.W.2d 651, 652 (Tex.App.--Fort Worth 1986, no writ); see also Liberty Mut. Fire Ins. Co. v. Ybarra, 751 S.W.2d 615, 618 (Tex.App.--El Paso 1988, no writ); ...