author: JIM WORTHEN, Justice.

text:
    In the Matter of the MARRIAGE OF Tonya Ann WILBURN and Ted Allan Wilburn.
    No. 12-99-00292-CV.
    Court of Appeals of Texas, Tyler.
    April 20, 2000.
    Rehearing Overruled May 31, 2000.

      Ebb B. Mobley, Longview, for Appellant.
    James Clark Wyly, Texarkana, for Ap-pellee.
    Panel consisted of RAMEY, Jr., C.J., HADDEN, J., and WORTHEN, J.
   JIM WORTHEN, Justice.

Appellant Tonya Ann Wilburn (“Tonya”) appeals from the trial court’s June 22,1999 order partially setting aside an order granting a motion for new trial in her decree of divorce from Ted Allen Wilburn (“Ted”). The June 22nd order from which Tonya appeals also establishes Ted’s father, Tommy D. Wilburn (“Tommy”), as trustee of Ted’s life insurance proceeds for the benefit of her two sons. In two issues, Tonya contends that the trial court had no jurisdiction to enter the June 22nd order because of Ted’s death and that it abused its discretion in appointing Tommy as a trustee of Ted’s life insurance proceeds for the benefit of her minor children because there was no evidence to support it. We will reverse and remand for further proceedings.

BACKGROUND

Tonya and Ted were married in 1991, and had two children during their marriage. In July of 1997, Ted filed for divorce, and two months later, Tonya filed a cross-action for divorce. On November 20, 1998, the trial court conducted a bench trial, and afterwards, the trial judge pronounced its ruling from the bench granting the divorce, dividing the property and establishing conservatorship of the two minor children. Further, it noted the granting of the divorce on its docket sheet.

On December 29, 1998, Ted was killed in an automobile accident. Subsequently, on March 19, 1999, the trial judge signed a divorce decree reducing its oral orders of November 20, 1998 to writing. On that same day, however, Tonya filed a motion for new trial which stated:

1. On March 19, 1999, a judgment was signed by this Court in this case.
2. The parties property rights to the employee retirement benefits and life insurance benefits are significantly affected depending upon whether the marriage was terminated by divorce or death. It is in the best interest of the children for their support and maintenance that the divorce judgment be set aside and a new trial be granted.
3. The granting of a new trial would not injure TED ALLAN WILBURN and would be in the best interest of his children.
4. Justice and the children’s best interests will not be properly served unless a[sic] the divorce is set aside and a new trial is granted.

Four days later, on March 23, 1999, the trial court signed the following order on Tonya’s motion for new trial:

On March 23, 1999, the Court heard the Motion for New Trial of TONYA ANN WILBURN. The Court finds that it is in the best interest of the children that the motion be granted. IT IS THEREFORE ORDERED that the motion is GRANTED and that a new trial is GRANTED. IT IS ORDERED that the Temporary Orders shall continue in force until further order of the Court.

On April 23, 1999, Tommy, the father of Ted, filed a Motion for Reconsideration of the Order Granting New Trial. Thereafter, on June 22, 1999, without hearing any further evidence, the trial court entered the following order:

On March 23,1999, this Court granted a partial new trial in the best interest of the children on the sole issue of the life insurance proceeds of Ted Allan Wilburn. The marital status of the parties and other property determinations were not affected by the partial new trial. On the 7th day of June, 1999, the parties appeared with counsel and a hearing was held. After consideration of briefs, argument of counsel, and upon hearing the evidence, the Court finds, in the interest of justice, the life insurance proceeds will remain as designated in the Decree and Tommy D. Wilburn is the proper beneficiary.
IT IS THEREFORE ORDERED that the life insurance proceeds will remain as designated in the Decree and Tommy D. Wilburn is the proper beneficiary, and the prior Decree of Divorce entered on March 19, 1999, controls for all other matters. Any order to the contrary is invalid and hereby withdrawn.
IT IS ORDERED that Ted Allan Wilburn’s life insurance proceeds and interest on deposit with Maxine Barnett, District Clerk of Anderson County, Texas or the Employees Retirement System of Texas shall be distributed to Substitute Petitioner and beneficiary, Tommy D. Wilburn or a trust or annuity by Tommy D. Wilburn. Any previously ordered past due child support owed by the Estate of Ted Allan Wilburn is to be paid upon receipt of the life insurance funds. The net remainder of the funds are to be held or invested in trust by Tommy D. Wilburn or at his direction or approval for the benefit of NATHAN ALLAN WILBURN and COTA LANE WILBURN and to provide child support payments pursuant to this Court’s March 19,1999, Decree of Divorce.

Tonya timely appealed the June 22nd order contending in two issues that the trial court did not have jurisdiction to enter it and that the trial court abused its discretion in making Tommy the trustee of Ted’s life insurance proceeds for the benefit of the two minor children. We will address these two issues together.

Dissolution of the MarRiage

Section 201 Of AMERICAN JURISPRUDENCE 2d aptly defines marriage as follows:

Marriage is a personal relationship between a man and a woman arising out of a civil contract to which the consent of the parties is essential. A marriage license, solemnized, and registered as provided, is valid in the State. A marriage may be contracted, maintained, invalidated, or dissolved only as provided by law.

52 Am. Jur.2D Marriage § 201 (Supp. 1999). In Texas, marriage may only be terminated by death or court decree. Estate of Claveria v. Claveria, 615 S.W.2d 164, 167 (Tex.1981). To determine how the marriage between Tonya and Ted was terminated, we must determine whether the trial court’s oral pronouncement of divorce had any legal effect on the parties’ marriage. A judgment routinely goes through three stages: (1) rendition; (2) reduction to writing; and (3) entry. Oak Creek Homes, Inc. v. Jones, 758 S.W.2d 288, 290 (Tex.App.—Waco 1988, no writ). A judgment is “rendered” when the matter submitted to it for adjudication is officially announced either orally in open court or by memorandum filed with the clerk. Samples Exterminators v. Samples, 640 S.W.2d 873, 875 (Tex.1982); Oak Creek Homes, Inc., 758 S.W.2d at 290. The principle that an oral judgment is valid is predicated upon the supporting principle that the entry of a trial judgment is only a ministerial act. Dunn v. Dunn, 439 S.W.2d 830, 832 (Tex.1969). Thus, a written judgment signed by the trial judge is not a prerequisite to the finality of a judgment. Id. at 832-33. Consequently, the marriage between Tonya and Ted ended when the decree of divorce was orally pronounced on November 20,1998.

The Trial Court’s Order Granting New Trial

Having determined that Tonya and Ted were divorced at the time of Ted’s death, we must next determine whether the trial court’s order granting new trial had any effect on the divorce decree. In the instant case, Ted died in December of 1998, and the trial court signed the divorce decree on March 19, 1999. The trial court then granted a motion for new trial on March 23,1999.

The facts of this case are strikingly similar to those found in Blain v. Broussard, 99 S.W.2d 993 (Tex.Civ.App.—Beaumont 1936, no writ). In Blain, the trial court orally granted a divorce on September 4th. On September 10th, the husband died. The wife then filed a motion for new trial which was granted by the trial court on September 19th. On appeal, the court held that the trial court’s order granting a motion for new trial after the death of the husband was void because the trial court no longer had personal jurisdiction over him. Id. at 995-97.

Although Blain is applicable to this case, before proceeding with our jurisdictional analysis under Blain, we will first revisit the supreme court’s opinion in Dunn, which criticized Blain. See Dunn, 439 S.W.2d at 833. In Dunn, the trial court had orally decreed a divorce between husband and wife on May 24th. Two days later, on May 26th, the husband died. The wife filed a motion to dismiss the divorce on June 21st stating the court lacked jurisdiction to enter the divorce decree. The trial court denied the wife’s motion and entered a written divorce decree pursuant to its oral orders of May 24th. Dunn, 439 S.W.2d at 831. Basing its decision upon the authority of Ledbetter v. Ledbetter, 229 S.W. 576 (Tex.Civ.App.—Austin 1921, no writ), the Tyler court of civil appeals reversed the trial court and remanded the case with instructions to dismiss it.

The supreme court, however, reversed the Tyler court and affirmed the trial court’s entry of the divorce decree. Dunn, 439 S.W.2d at 834. The supreme court based the rationale for this ruling upon the principle that the oral decree of divorce preceded the death of the husband and that the written decree after his death was only a ministerial act. Id. at 832. The supreme court thus determined that the marriage in Dunn had ended by divorce on May 24th rather than two days later on May 26th upon Mr. Dunn’s death. Id. at 834. The supreme court then determined that because the divorce decree could be entered, the issue of property rights was still ripe for adjudication on appeal. Id. Thus, the holding in Dunn reversed the Ledbetter decision which had concluded that when the divorce action, which is a personal one, becomes moot, the incidental issues of property become moot as well.

It is clear from Dunn that the trial court maintains jurisdiction over property issues determined in a divorce decree that is pronounced before the death of one of the spouses. Dunn, 439 S.W.2d at 834. Yet the general rule in Texas is that the divorce action itself is purely personal in nature. McKenzie v. McKenzie, 667 S.W.2d 568, 571 (Tex.App.—Dallas 1984, no writ); Garrison v. Texas Commerce Bank, 560 S.W.2d 451, 453 (Tex.Civ.App.—Houston [1st Dist.] 1977, writ ref d n.r.e.). A purely personal action, such as the actual divorce that dissolves a marriage, becomes moot upon the death of one of the spouses. See id. In Dunn, the personal nature of the divorce ended after the husband died on May 26th, yet the property rights portion of the judgment dissolving the marriage entered two days earlier was still ripe for appeal. Dunn, 439 S.W.2d at 834. Dunn, although including Blain and Ledbetter together in its analysis, never actually addressed the need for a court to have personal jurisdiction over the parties to the divorce itself as the Blain court had done. Id. at 833-34. Instead, it focused its analysis on the incidental property issues related to the dissolution of the marriage. Id. We therefore revisit Blain as it relates to the jurisdiction of a trial court to grant a motion for new trial of the divorce after a trial court has rendered a divorce decree.

The purpose of a motion for new trial is to have the trial court correct errors which may have occurred in the course of the preceding trial. Sandoval v. Rattikin, 395 S.W.2d 889, 891 (Tex.Civ.App.—Corpus Christi 1965, writ ref d). In Blain, the reason given by the wife in wishing to have the divorce from her deceased ex-husband set aside was that “she no longer desire[d] to prosecute this suit.” Blain, 99 S.W.2d at 994. The Beaumont court of civil appeals determined that an order attempting to vacate the rendered divorce decree was void because the court no longer had personal jurisdiction over the husband. Id. at 996. At the time a new trial is granted, the court must have jurisdiction both over the parties and the subject matter to the same extent as when the original judgment was entered. Id. at 995. Thus, if a trial court grants a motion for new trial to dissolve a divorce decree after one of the parties to the decree has died, it is “guilty of proceeding in the matter ex parte ...” Id. at 996. Furthermore, the trial court lacks personal jurisdiction over both parties, so its order is void; Id. at 995; see American Gen. Fire & Cas. Co. v. Vandewater, 907 S.W.2d 491, 492 (Tex.1995).

It is clear then from a careful reading of Dunn and cases cited therein that the supreme court was not criticizing the Blain court’s holding that the trial court lacked jurisdiction to undo a divorce where a motion for new trial was filed by a surviving spouse after the death of the other party to the divorce decree. Dunn, 439 S.W.2d at 833-34. Instead, the supreme court’s focus in Dunn was on the authority of the trial court to enter a written decree of divorce when a spouse had died subsequent to the oral pronouncement dissolving the marriage. Id. at 832. Dunn also clarified the fact that courts do have jurisdiction to reconsider property issues in the divorce decree after the death of one of the parties. Id. at 833-34.

In her brief, Tonya maintains that the trial court did have jurisdiction to grant her motion for new trial following Ted’s death. In support of her position, she cites Turner v. Ward, 910 S.W.2d 500 (Tex.App.—El Paso 1994, no writ) and Nichols v. Nichols, 907 S.W.2d 6 (Tex.App.—Tyler 1995, writ denied). These two cases, however, are readily distinguishable from the instant case because they involve attacks upon the validity of the divorce decree. In Turner, the court held that the trial court abused its discretion by not granting the wife a new trial on the basis that she had never received notice that the trial court had granted the divorce decree. Turner, 910 S.W.2d at 505. When a party has answered in a divorce case, he or she is entitled to notice of trial pursuant to Rule 245 of the Texas Rules of Civil Procedure. Id. A trial court’s failure to comply with the rules of notice in a contested case deprives a party of the constitutional right to be present at the hearing, to voice his objections in an appropriate manner, and results in a violation of fundamental due process. Platt v. Platt, 991 S.W.2d 481, 483 (Tex.App.—Tyler 1999, no pet.). In the instant case, it is uncontroverted that both parties were properly before the court when the marriage was dissolved on November 20, 1998. Thus, Turner is not applicable to the case at bar because the initial divorce decree in that case lacked constitutional validity. Here, the validity of the decree granting the divorce and dissolving the marriage has never been attacked.

In Nichols, this court determined that a new trial should be granted following the death of the husband because the initial divorce had been obtained under duress. Nichols, 907 S.W.2d at 12. A judgment obtained under duress or fraud is voidable. See Hollis v. Hollis, 226 S.W.2d 129, 133 (Tex.Civ.App.—Amarillo 1949, writ dism’d w.o.j.). In this case, however, there have been no allegations of duress or fraud which would make the divorce decree itself voidable.

Thus, relying upon the reasoning in Blain and other authorities cited herein, we hold that when an ex-spouse dies subsequent to the rendering of a divorce decree, a trial court has no jurisdiction to grant a motion for new trial to undo the divorce absent a showing of fraud, duress, or deprivation of due process. We also follow the holding in Dunn that a court maintains jurisdiction to reconsider the property rights incidental to the divorce or dissolution of the marriage itself even after the death of a party following the rendition of the divorce decree. Consequently, we conclude that the marriage of Tonya and Ted ended by divorce, that Tonya could not revisit the issue of their marital status following Ted’s death, but that the trial court could reconsider property rights incidental to the divorce.

The June 22, 1999 ORDER

Tonya contends that the trial court’s June 22nd order was void because the trial court no longer had jurisdiction over the divorce due to Ted’s death; it merely had jurisdiction to undo the divorce. Because of our disposition of the March 23, 1999 order granting new trial, this complaint need not be addressed. As noted above, we have already held that the trial court did not have jurisdiction to vacate the divorce decree as to the parties’ marital status but did have jurisdiction to reconsider property rights incidental to the divorce. Thus, to the extent the trial court had determined property rights in the initial divorce decree, the order granting new trial vacated those determinations, and the trial court had jurisdiction to reconsider them.

We thus turn to Tonya’s complaint that there was no evidence to support the trial court’s June 22nd order. When a motion for new trial is granted, the original judgment is set aside and stands generally as no trial has been had. See Electrical Contracting & Maintenance Co. v. Perry Distrib., Inc., 432 S.W.2d 543, 547 (Tex.Civ.App.—Dallas 1968, writ ref d n.r.e.). Following entry of the June 22, 1999 order, no findings of fact and conclusions of law were requested or filed; therefore, we must uphold the judgment on any valid legal theory supported by the evidence. In re W.E.R., 669 S.W.2d 716, 717 (Tex.1984); Sharp v. Hobart Corp., 957 S.W.2d 650, 652 (Tex.App.—Austin 1997, no pet). At the hearing prior to entry of the June 22nd order, the trial court neither heard any testimony nor admitted any evidence. Further, no legal arguments as to the proper disposition of the property were entertained. Consequently, there exists no legal or factual basis for upholding the trial court’s disposition of the property.

Conclusion

Tonya’s first issue is thus overruled because the trial court did not have jurisdiction to grant a new trial of the divorce but did have jurisdiction to grant a new trial as to the parties’ property rights. Blain, 99 S.W.2d at 994; see Dunn, 439 S.W.2d at 833-34. Issue two is sustained on grounds that there was no evidence to support the characterization and division of the property at issue. The trial court’s order of June 22, 1999 is reversed and the cause is remanded for further proceedings on the division of the marital estate’s property consistent with this opinion.

      . Tommy was never substituted as the party of record at the trial court level, although he filed a suggestion of death regarding his son, Ted, and he appeared through counsel at two hearings held by the trial court on May 20 and June 7, 1999.

      . In Ledbetter, the husband died while the trial court's decree of divorce was on appeal. Id. at 577. The Austin court of civil appeals dismissed the appeal because the property questions which had been appealed were "merely incidental" to the personal issue of the actual divorce of the husband and wife. Id. The court reasoned that with the death of the husband, the divorce action failed for mootness and that any incidental issues of the dissolution of the marriage itself such as property, should not be considered and that the trial court should dismiss the appeal in its entirety. Id.

      . Had we not earlier held that the trial court’s order granting new trial was void to the extent that it attempted to undo the divorce, we would be required to conclude that the June 22nd order is void to the extent it attempted to partially un-grant the motion for new trial. As noted above, the June 22nd order purports to re-characterize the March 23 rd order granting new trial as an order that grants a new trial only as to the division of certain assets but which leaves the decree of divorce intact. The trial court entered its June 22nd order ninety-five days after signing its judgment. The June 22nd order attempted to describe the March 23rd order as granting only a partial new trial. The order of March 23rd, however, clearly attempted to grant a new trial in its entirety. When a trial court grants a new trial, it can vacate the order granting the new trial only within its plenary power. Porter v. Vick, 888 S.W.2d 789, 790 (Tex.1994). This plenary power of the trial court with regard to its grant of a new trial extends only for seventy-five days from the date the judgment was signed. Fruehauf Corp. v. Carrillo, 848 S.W.2d 83, 84 (Tex.1993). That date was March 19 and the court’s plenary power to vacate its motion for new trial ended on June 3rd. Therefore, its June 22nd order attempting to partially undo its granting of a. new trial was not entered within its plenary power. Homart Dev. Co. v. Blanton, 755 S.W.2d 158, 159 (Tex.App.—Houston [1st Dist.] 1988, no writ).


source: Caselaw Access Project

author: SUSAN LARSEN, Justice.

license: Public Domain

text:
    INSURANCE COMPANY OF THE STATE OF PENNSYLVANIA, Appellant, v. Mike C. MARTINEZ, Appellee.
    No. 08-99-00124-CV.
    Court of Appeals of Texas, El Paso.
    April 27, 2000.

      Bruce Bangert, Shafer, Davis, McCol-lum, Ashley, O’Leary & Stoker, Odessa, for appellant.
    Barry L. Hart, Law Office of Barry L. Hart, Odessa, for appellee.
    Before Panel No. 3 BARAJAS, C.J., LARSEN, and CHEW, JJ.
   OPINION

SUSAN LARSEN, Justice.

The Insurance Co. of the State of Pennsylvania, a workers’ compensation insurance carrier, appeals from a summary judgment holding that an impairment rating assigned to plaintiff/appellee Mike Martinez by his treating physician had not become final, and therefore was subject to Martinez’s challenge although more than ninety days had passed. We dismiss the appeal because the trial court’s judgment was void for failure to provide the Texas Workers’ Compensation Commission with the proposed judgment thirty days before it was entered.

FACTS

Martinez was injured while working for Nabors Drilling U.S.A., Inc. in April of 1995 and filed for workers’ compensation benefits. In accordance with Texas Labor Code Section 408.123(a), which requires the treating physician to assign an impairment rating (IR) after the injured worker reaches a state of maximum medical improvement (MMI), Martinez’s' physician assigned him a 10 percent whole body IR on March 1, 1996. Although the Texas Labor Code requires that an impairment rating be assessed using the third edition of the Guides to the Evaluation of Permanent Impairment, published by the American Medical Association, it is undisputed that Martinez’s physician used the fourth edition.

More than two years after his doctor assigned the initial IR, Martinez contested it, asserting that because the physician used the wrong edition of the “AMA Guides,” his impairment rating had never been properly certified and had not become final despite his failure to dispute it within ninety days. The hearing officer agreed that the March 1, 1996 impairment rating had not become final because the wrong edition of the Guides had been used.

The Insurance Company of the State of Pennsylvania appealed this decision to the Texas Workers’ Compensation Commission Appeals Panel, countering that the rating had become final, and Martinez was now precluded from disputing it. The panel reversed the decision of the hearing officer, and held that “[T]he use of the wrong version of the AMA Guides does not invalidate the first certification.... If a party believes the first certification is incorrect for this reason, then that party must raise that during the 90 days provided by Rule 130.5(e) for disputes.”

Martinez then appealed the decision of the panel to the Reeves County District Court. There, he filed a motion for summary judgment in which he again argued that the ninety-day deadline for disputing his impairment rating had never been triggered. On March 30, 1999, the trial court entered summary judgment in favor of Martinez, affirmed the hearing officer’s decision, and remanded the cause to the Texas Workers’ Compensation Commission (TWCC) for further proceedings. The TWCC was not given notice of the trial court’s intent to enter judgment, nor was it provided with a copy of the proposed judgment. Appellant, Insurance Company of the State of Pennsylvania, now brings this appeal.

Jurisdiction

Because jurisdiction is fundamental, an appellate court must determine, even sua sponte, whether it has jurisdiction to consider an appeal. An appellate court’s jurisdiction extends no further than the jurisdiction of the trial court. When the trial court acts outside its jurisdiction, the proper action by the reviewing court is to set aside the improper judgment and dismiss the appeal.

This appellate court has no jurisdiction to consider the merits of an appeal from a void judgment. A judgment is void only when it is clear that the court rendering judgment had no jurisdiction over the parties or subject matter, no jurisdiction to render judgment, or no capacity to act as a court. When appeal is taken from a void judgment, the appellate court must declare the judgment void. Because the appellate court may not address the merits, it must set aside the trial court’s judgment and dismiss the appeal.

The insurance company asserts that summary judgment here was void because the parties failed to comply with Texas Labor Code Section § 410.258(a) (added by Acts 1997, 75th Leg., R.S., ch. 1267, § 2, 1997 Tex. Gen. Laws 4792, 4793, eff. Sept. 1, 1997). Under that section, a party initiating proceedings for judicial review of an appeals panel decision must file any proposed judgment, including a proposed default judgment, with the executive director of the TWCC not later than the 30th day before the date on which the court is scheduled to enter the judgment. The statute specifically states that a judgment entered without complying with the requirements of this section is void.

The purpose of this provision in the law is to prevent the use of settlement agreements and default judgments to overturn appeals panel decisions. The requirement also ensures that the TWCC has notice and an opportunity to intervene in a workers’ compensation lawsuit to explain why a judgment or settlement should not be approved by a court. Specifically, Section 410.258 authorizes the TWCC to intervene as a matter of right in the proceeding not later than the 30th day after receiving a proposed judgment or settlement if it determines that the proposal is not in compliance with the law. The burden of compliance is on the litigating parties.

In Albertson’s Inc. v. Sinclair, the Texas Supreme Court contrasted the notice provision at issue here, with one requiring a party seeking review of a TWCC decision to file a copy of its petition with the TWCC. In finding that providing the TWCC a copy of the petition when filed is mandatory, but not jurisdictional, the Court wrote:

[T]hat [the section] does not dictate the consequence of noncompliance is significant when considering the entire statute. [In contrast,] Section 410.258 requires the petitioner in a judicial review proceeding to provide the Commission a proposed judgment or settlement not later than the thirtieth day before the court is scheduled to enter the judgment or approve the settlement.... [This] provides the Commission yet another opportunity to intervene, up to’ the thirtieth day after receiving the proposed judgment or settlement. Importantly, subsection 4-10.2580 provides that a judgment entered or settlement approved without complying with section 410.258’s requirements is void. That the Legislature could have but did not similarly-provide a consequence for noncompliance with section 410.253 suggests that it chose not to do so.

The Court has since declined to revisit its holding in Albertson’s.

Thus, we are compelled to hold that compliance with Section 410.258 is both mandatory and jurisdictional, and failure to give the TWCC notice of a proposed judgment under that section rendered the judgment at issue here void.

CONCLUSION

Before the trial court entered summary judgment, no notification was filed with the commission as mandated by Section 410.258. The trial court was therefore without jurisdiction to render judgment, and it is void. This court may only declare such judgment void, set it aside, and dismiss the appeal.

      . Tex. Lab. Code Ann. § 408.123(a) (Vernon 1996) states: "After an employee has been certified by a doctor as having reached maximum medical improvement, the certifying doctor shall evaluate the condition of the employee and assign an impairment rating using the impairment rating guidelines described by Section 408.124.”

      . Tex. Lab. Code Ann. § 401.011(24) (Vernon 1996) defines "impairment rating” as "the percentage of permanent impairment of the whole body resulting from a compensable injury-”

      . Tex. Lab. Code Ann. § 408.124 (Vernon 1996) states: (a) An award of an impairment income benefit, whether by the commission or a court, shall be made on an impairment rating determined using the impairment rating guidelines described in this section, (b) The commission shall use for determining the existence and degree of an employee's impairment "Guides to the Evaluation of Permanent Impairment,” third edition, second printing, dated February 1989, published by the American Medical Association.

      . Tex. Admin. Code § 130.5(e) (1991) (Texas Workers’ Compensation Comm’n, Impairment Rating Disputes) states, in pertinent part: "The first impairment rating assigned to an employee is considered final if the rating is not disputed within 90 days after the rating is assigned.”

      . Fandey v. Lee, 876 S.W.2d 458, 459 (Tex.App.—El Paso 1994, no writ) (per curiam); H.E. Butt Grocery Co. v. Bay, Inc., 808 S.W.2d 678, 679 (Tex.App.—Corpus Christi 1991, writ denied).

      . George v. Phillips Petroleum Co., 976 S.W.2d 363, 364-65 (Tex.App.-Houston [14th Dist.] 1998, no writ) (citing Pearson v. State, 159 Tex. 66, 315 S.W.2d 935, 938 (1958)); Bahr v. Kohr, 928 S.W.2d 98, 100 (Tex.App.—San Antonio 1996, writ denied).

      . Bahr, 928 S.W.2d at 100; Dallas County Appraisal Dist. v. Funds Recovery, Inc., 887 S.W.2d 465, 468 (Tex.App.—Dallas 1994, writ denied); Anderson v. Anderson, 786 S.W.2d 79, 81 (Tex.App.—San Antonio 1990, no writ); Sanchez v. Sanchez, 609 S.W.2d 307, 308 (Tex.Civ.App.—El Paso 1980, no writ).

      . Mellon Service Co. v. Touche Ross & Co., 946 S.W.2d 862, 864 (Tex.App.—Houston [14th Dist.] 1997, no writ).

      . State ex rel. Latty v. Owens, 907 S.W.2d 484, 485 (Tex.1995).

      . Id. at 486 (citing Fulton v. Finch, 162 Tex. 351, 346 S.W.2d 823, 827 (1961)); Dallas County v. Sweitzer, 971 S.W.2d 629, 630 (Tex.App.—Dallas 1998, no writ); Haun v. Steigleder, 830 S.W.2d 833, 834 (Tex.App.—San Antonio 1992, no writ).

      . Mellon Service Co., 946 S.W.2d at 864.

      . Tex. Lab. Code Ann. § 410.258(a) (Vernon Supp.2000) states, in pertinent part: “The party who initiated a proceeding under this subchapter or Subchapter G must file any proposed judgment or settlement made by the parties to the proceeding, including a proposed default judgment, with the executive director of the commission not later than the 30th day before the date on which the court is scheduled to enter the judgment or approve the settlement. The proposed judgment or settlement must be mailed to the executive director by certified mail, return receipt requested.”

      . Tex. Lab. Code Ann. § 410.258(f) (Vernon 1996) (added by Acts 1997, 75th Leg., R.S., ch. 1267, § 2, 1997 Tex Gen. Laws 4792, 4793, eff. Sept. 1, 1997).

      . See House Committee Report, Bill Analysis, Tex. H.B. 3137, 75th Leg., R.S. (1997).

        . See id.

      . See id.

      . See id.

      . Tex. Lab. Code Ann. § 410.253 (Vernon 1996) states: "A copy of the petition shall be simultaneously filed with the court and the commission and served on any opposing party-”

      . Albertson's Inc. v. Sinclair, 984 S.W.2d 958, 962 (Tex.1999); Benavidez v. Travelers Indem. Co. of Connecticut, 985 S.W.2d 458, 458 (Tex.1999) (per curiam); see also Galpin v. Zenith Ins. Co., 993 S.W.2d 146, 147 (Tex.App.—San Antonio 1999, no writ); St. Paul Fire and Marine Ins. Co. v. Meador, 990 S.W.2d 362, 367 (Tex.App.—Fort Worth 1999, no writ); Ortiz v. Insurance Co. of State of Pa., 988 S.W.2d 882, 884 (Tex.App.—El Paso 1999, no writ).

      . Sinclair, 984 S.W.2d at 962 (emphasis added) (internal citations omitted).

      . See National Liability and Fire Ins. Co. v. Allen, 15 S.W.3d 525, 527 (Tex. 2000).

      . See State ex rel. Latty, 907 S.W.2d at 486; Mellon Service Co., 946 S.W.2d at 864.


author: TERRY McCALL, Justice.

text:
    Jess Dewayne DUTTON, Appellant, v. Vicky Lynn DUTTON, Appellee.
    No. 11-99-00251-CV.
    Court of Appeals of Texas, Eastland.
    May 4, 2000.

      John Saringer, Scott Seamster, Wag-staff, Alvis, Stubbeman, Seamster & Lon-gacre, Abilene, for appellant.
    John M. Bailey, Glandon <⅞ Scarbrough, Abilene, for appellee.
    Panel consists of: ARNOT, C.J., and WRIGHT, J„ and McCALL, J.
   OPINION

TERRY McCALL, Justice.

Jess Dewayne Dutton appeals the trial court’s judgment in his divorce from Vicky Lynn Dutton. Because we hold that his contentions on appeal are precluded by a judicial admission made in the trial court, we affirm.

Background Facts

The Duttons were married from 1984 to 1998. In 1995, Vicky’s parents, the Vin-sons, conveyed 150 acres of land (the property) to ‘VICKY L. DUTTON and husband, JESS D. DUTTON.” Although the Duttons executed a promissory note for $18,000 to the Vinsons, the Vinsons forgave the note in 1996. The Duttons built a house on the property and made other improvements. Vicky filed a sworn inventory and appraisement in which she listed the property as her separate property. At the final hearing, Vicky introduced her inventory and appraisement into evidence.

Vicky also testified about the acquisition of the property. She testified that the property belonged to her father’s family and that her father “grew up” on the property. She testified that the property was her “inheritance” and that her father “wanted to see [her] be able to use it while he was alive.” She also testified that she had Jess’ name put on the deed because she “felt pressured” and that she “didn’t feel like [she] would ever be able to use it if his name wasn’t on it.” Vicky maintained at trial that her parents intended the property as a gift to her alone. The Vinsons did not testify.

Jess also filed a sworn inventory and appraisement with the trial court. In his inventory, he fisted the property as community property. Jess did not introduce his inventory and appraisement into evidence. He disputed Vicky’s characterization of the property in his testimony:

Q: Now, she’s claiming the land is solely hers?
A: No. The land was a gift to both of us through her parents because we was going to buy a piece of land and her parents talked us out of it.

On direct examination, Jess also testified as follows:

Q: Do you have the financial ability to pay your wife for any community property interest that this Court might award her if the Court were to award you the house and property?
A: Yes, sir.
Q: In your opinion what do you believe would be fair for this Court to do in this divorce action as far as awarding property?
A: They award me the house and my son and “X” amount of acres to go with that house around it to get that air condition (sic) system and that tank in there, and then she can have the land . and the rest. (Emphasis added)

Even though Jess stated that “[t]he land was a gift to both of us,” the record reflects that, at trial, Jess was contending that the property was community to rebut Vicky’s assertion that it was her separate property.

After the parties rested and closed, the trial court said, “I’m going to have to give this some thought and review each party’s inventories.” (Emphasis added) Finding that the property was community property, the trial court awarded the entire property to Vicky. The court also awarded Jess a money judgment of $40,000 plus 12 percent interest until paid, secured by a lien against the property. On appeal, Jess argues that he had a separate property interest in the property because it was a joint gift to him and Vicky.

Division of the Marital Estate

The trial court must make what it deems to be a “just and right” division of the marital estate, “having due regard for the rights of each party and any children of the marriage.” TEX. FAM. CODE ANN. § 7.001 (Vernon 1998). The trial court exercises wide discretion in the division of marital property. Its division of marital property will not be disturbed on appeal unless it is shown that the court has clearly abused its discretion. Jacobs v. Jacobs, 687 S.W.2d 731, 733 (Tex.1985); Murff v. Murff, 615 S.W.2d 696, 698 (Tex.1981); Hedtke v. Hedtke, 112 Tex. 404, 248 S.W. 21, 23 (1923). The test for abuse of discretion is whether the trial court acted without reference to any guiding rules or principles or whether the act was arbitrary and unreasonable. Worford v. Stamper, 801 S.W.2d 108, 109 (Tex.1990).

The trial court may not, however, divest a party of his or her separate property. Eggemeyer v. Eggemeyer, 554 S.W.2d 137, 142 (Tex.1977). Any property acquired during marriage is presumed to be community property in the absence of clear and convincing evidence to the contrary. TEX. FAM. CODE ANN. § 3.003 (Vernon 1998). Property received by gift during marriage is the separate property of the receiving spouse. TEX. FAM. CODE ANN. § 3.001 (Vernon 1998); Perez v. Perez, 587 S.W.2d 671, 673 (Tex.1979). A joint gift to a husband and wife is not community property; rather, each gets a one-half undivided separate interest in the gift. Roosth v. Roosth, 889 S.W.2d 445, 457 (Tex.App.—Houston [14th Dist.] 1994, writ den’d); McLemore v. McLemore, 641 S.W.2d 395, 397 (Tex.App.—Tyler 1982, no writ); King v. Summerville, 80 S.W. 1050, 1052 (Tex.Civ.App.), aff'd, 98 Tex. 332, 83 S.W. 680 (1904).

There is nothing in the deed to indicate that the transaction was a gift. A deed from a third party in the names of both husband and wife raises a presumption that the property is community rather than jointly-held separate property. Dakan v. Dakan, 125 Tex. 305, 83 S.W.2d 620, 626 (1935). To overcome the presumption of community property, Jess had to establish at trial that the property was his separate property by clear and convincing evidence. Section 3.003. However, we review the trial court’s characterization of marital property by conducting an analysis of the legal and factual sufficiency of the evidence offered at trial. See McElwee v. McElwee, 911 S.W.2d 182 (Tex.App.—Houston [1st Dist.] 1995, writ den’d).

On appeal, Jess argues that the law is settled that a.joint gift to a husband and wife does not result in a gift to the community estate. McLemore v. McLemore, supra. We note that in McLemore and the cases upon which it relies, the person asserting the separate property interest did so in the trial court first. For example, the defendant after a bench trial in McLemore filed a motion for new trial on the ground that the house was separate property. Jess did not challenge the trial court’s findings of facts or conclusions of law. Neither in his pleadings nor at trial did he contend that the property was partly his separate property. The court simply found that the property was community property as Jess had asserted in his sworn inventory and appraisement. While he was not required to file a motion for new trial, Jess should have made the trial court aware, at some point, of the complaint he now presents on appeal. TEX. R.APP.P. 33.1; TEX.R.CIV.P. 324.

In view of Jess’ inventory and appraisement and of his failure to preserve error, we hold that the trial court’s determination was not so contrary to the great weight and preponderance of the evidence as to be clearly wrong and manifestly unjust. Cain v. Bain, 709 S.W.2d 175, 176 (Tex.1986).

Judicial Admission

Jess argues that he had a separate property interest in at least part of the property. Vicky, however, argues that Jess’ characterization of the property as community property in his inventory and ap-praisement constitutes a judicial admission. Such an admission, she contends, bars him from now asserting that he had a separate property interest in the property. We agree.

Judicial admissions estop the party who made them from challenging their truth. Five conditions must occur before a party’s admission is conclusive against him: (1) the declaration relied upon must have been made in the course of a judicial proceeding; (2) the declaration was contrary to an essential fact embraced in the theory of recovery or defense asserted by the party; (3) the statement was deliberate, clear, and unequivocal; (4) giving conclusive effect to the declaration would not run contrary to public policy; and (5) the declaration related to a fact upon which a judgment for the opposing party was based. Griffin v. Superior Insurance Company, 161 Tex. 195, 338 S.W.2d 415, 419 (1960); United States Fidelity & Guaranty Co. v. Carr, 242 S.W.2d 224, 229 (Tex.Civ.App.—San Antonio 1951, writ ref d).

Although Griffin and Cam' involved testimonial assertions, appellate courts have given preclusive effect to sworn inventories and appraisements filed with the trial court. Roosevelt v. Roosevelt, 699 S.W.2d 372, 374 (Tex.App.—El Paso 1985, writ dism’d); see Tschirhart v. Tschirhart, 876 S.W.2d 507, 509 n. 1 (Tex.App.—Austin 1994, no writ). In Roosevelt, the wife filed an inventory and appraisement listing some jewelry as her separate property and some jewelry as community property. The court of appeals held that the trial court could not characterize all the jewelry as separate property and that the wife could not have introduced evidence to support such a characterization because her sworn assertions in the inventory and ap-praisement prevented her from claiming all of the jewelry as her separate property.

Tschirhart held that a party challenging the sufficiency of the evidence to support the trial court’s division of property could not rely on his sworn inventory and ap-praisement that was filed with the trial court but was not admitted into evidence. The Tschirhart court did state in a footnote that an inventory, like a pleading, could not be used as evidence to support a positive assertion by a party on appeal but could be used to estop that party from challenging his prior admission. Tschirhart v. Tschirhart, supra; see also Poulter v. Poulter, 565 S.W.2d 107, 110 (Tex.Civ.App.—Tyler 1978, no writ); Bokhoven v. Bokhoven, 559 S.W.2d 142, 144 (Tex.Civ.App.—Tyler 1977, no writ).

In the present case, Jess filed a sworn inventory and appraisement listing the property as community property. That statement met the criteria set forth in Griffin and Carr, and it constituted a judicial admission. The statement was made in the course of a judicial proceeding. It was contrary to Jess’ position on appeal and was made deliberately, clearly, and unequivocally. It would further the public policy of this State to give effect to the statement: property accumulated during the marriage is presumed to be community property in the absence of clear and convincing evidence to the contrary. Section 3.003. Finally, as discussed below, the statement relates to a fact upon which judgment for Vicky might be based.

Jess cites cases for the proposition that a judicial admission is waived if the opposing party introduces evidence contrary to the admission. See Industrial Disposal Supply Company, Inc. v. Perryman Brothers Trash Service, Inc., 664 S.W.2d 756, 763-64 (Tex.App.—San Antonio 1983, writ ref'd n.r.e.); Wilkins v. Cook, 454 S.W.2d 769, 770-71 (Tex.Civ.App.—Eastland 1970, writ refd n.r.e.); Starks v. City of Houston, 448 S.W.2d 698, 699-700 (Tex.Civ.App.—Houston [1st Dist.] 1969, writ refd n.r.e.); Dallas Transit Company v. Young, 370 S.W.2d 6, 10-11 (Tex.Civ.App.—Dallas 1963, writ refd n.r.e.); Restelle v. Williford, 364 S.W.2d 444, 446 (Tex.Civ.App.—Beaumont 1963, writ refd n.r.e.). He contends that, when Vicky introduced the warranty deed, closing statement, and release of hen into evidence, she waived any judicial admission that he made because those pieces of evidence establish that the Vinsons deeded the property as a joint gift to both him and Vicky.

Jess’ argument fails for two reasons. First, a gift cannot occur absent a donative intent by the grantor. Scott v. Scott, 805 S.W.2d 835, 840 (Tex.App.—Waco 1991, writ den’d); Thompson v. Lawson, 793 S.W.2d 94, 96 (Tex.App.—Eastland 1990, writ den’d). The grantor’s donative intent at the time of the conveyance is a controlling factor to determine the nature of a gift. Rusk v. Rusk, 5 S.W.3d 299, 303 (Tex.App.—Houston [14th Dist.] 1999, pet’n den’d). Although the parties agree that the property was a gift, Vicky testified that the Vinsons intended it as a gift to her alone. No other evidence was heard about the grantors’ donative intent.

The fact that the deed bears both Jess’ and Vicky’s names does not conclusively establish a joint gift. Extrinsic evidence is important in cases where the nature of a gift is raised. In Roosth, the wife claimed that certain wedding gifts were given to her alone, but she failed to adequately show which gifts they were. In King, the court noted that the deed on its face would give no notice to innocent purchasers that the property in question was not community property. The deed recited that the grantees gave the grantor “$10 cash and other valuable considerations” for the conveyance. The court went on to hold that the “extrinsic evidence introduced upon the trial clearly showed that [the mother] intended to convey the land to her son-in-law and daughter in equal parts.”

In the present case, the warranty deed and release of hen do not indicate that the conveyance was a gift. The deed states that the sale was made for consideration; the release states that the note was paid in full. Only the closing statement mentions a “[gift from sellers.” That document would not be in the chain of title. Thus, Vicky’s testimony about her parents’ dona-tive intent might have supported a finding by the trial court that the property was her separate property. That question is not presented here, however. What is important is that the evidence introduced does not compel the legal conclusion that her parents made a joint gift that vested undivided half-interests in the property in her and Jess.

The second flaw in Jess’ argument is that the cases cited are distinguishable. In Industrial Disposal Supply, Wilkins, and Starks, the plaintiff suffered an adverse judgment, failing in his burden of proof at trial. In each case, the plaintiff attempted on appeal to use a judicial admission to support a positive assertion and override the jury’s finding. Dallas Transit and Restelle both involved defendants who lost in the trial court and attempted to support their positive assertions on appeal with supposed judicial admissions. As noted above, judicial admissions will rarely support a positive assertion on appeal.

This is especially true when the party seeking to support a positive assertion with a judicial admission does not attempt to use that admission at trial. The rule of waiver embodied in the five cases cited by Jess requires a party to make positive assertions in the trial court first. This rule is consistent with Rule 33.1 which requires a party to make his request or objection in the trial court and to obtain a ruling thereon from the trial court in order to preserve error. The Texas Supreme Court cited Starks, Dallas Transit, and Restelle for the proposition that:

The party relying on his opponent’s pleadings as judicial admissions of fact, however, must protect his record by objecting to the introduction of evidence contrary to that admission of fact and by objecting to the submission of any issue bearing on the fact admitted.

Houston First American Savings v. Musick, 650 S.W.2d 764, 769 (Tex.1983).

Here, however, Vicky did not seek to rely on the judicial admission to support her contentions at trial. At trial, she contended that the property was her separate property. Instead, Vicky seeks on appeal to estop Jess from taking a position inconsistent with his theory at trial. In fact, there was no need to view the inventory as a judicial admission until Jess contended on appeal that the property was his separate property. He clearly regarded the property as community property when he testified at trial. He even requested the trial court to divide the property between him and Vicky. The rule of waiver stated in the eases cited above is inapplicable in this case.

The trial court could take judicial notice of the contents of its files. TEX. R.EVID. 201(b) and (c); see Vannerson v. Vannerson, supra. This court may take judicial notice, even if no one requested the trial court to do so and even if the trial court did not announce that it would do so. Harper v. Killion, 162 Tex. 481, 348 S.W.2d 521, 523 (1961). Thus, the trial court and this court can take judicial notice of the fact that Jess made an admission in his inventory. Furthermore, the trial court announced that it would consider “each party’s inventories.” Jess did not attempt to contend at trial that the property was anything but community property, and he did not withdraw the statement made in his inventory. He may not contend differently now. Roosevelt v. Roosevelt, supra; Tschirhart v. Tschir-hart, supra.

The judicial admission in his inventory and appraisement estops Jess from denying that the property is community property. Given that fact, the trial court had broad discretion to make a fair and just division of the community estate. See Murff v. Murff, supra-, Hedtke v. Hedtke, supra. We find no abuse of discretion in the trial court’s division of the estate. We overrule Jess’ sole issue for review.

This Court's Ruling

The judgment of the trial court is affirmed.

      . Jess acknowledges that the $18,000 note, even though forgiven, might render a portion of the property community property. He calculates that, from the purported purchase price of $56,250, $38,250 or 68 percent of the property’s value was a gift. Thus, he would have at least a 34 percent separate property interest in the property. We express no opinion on the effect of the forgiven note on the characterization of the property.

      .Both Poulter and Bokhoven involved attempts by a party on appeal to support a positive assertion with an unadmitted inventory and appraisement. Poulter, like Tschir-hart, involved an attempt to challenge the division of property based on the monetary value of the property as listed in the inventory and appraisement. The inventory in Bokhoven was not sworn. But see Vannerson v. Vannerson, 857 S.W.2d 659, 670-71 (Tex.App.—Houston [1st Dist.] 1993, writ den'd), holding that the trial court could take judicial notice of the contents of anything in the court’s file and use the contents as evidence to support its judgment. Vannerson, however, involved the trial court’s, and not the appellate court’s, use of the contents as evidence.

      . The record actually shows that Jess introduced the warranty deed into evidence as Respondent’s Exhibit No. 1.

      . Unobjected-to hearsay is, of course, probative evidence. TEX.R.EVID. 802.

      . In King, the court also held that a recital in a later deed in the chain of title that the grantor and her husband had received the property in question as a gift from her mother was enough to put the subsequent purchasers on inquiry as to the nature of the property and the interests therein.


author: ADELE HEDGES, Justice.

text:
    Ray LOTFI, Appellant, v. Audburgh D. WILLIAMS, Individually and as Trustee, Appellee.
    No. 01-99-01429-CV.
    Court of Appeals of Texas, Houston (1st Dist.).
    May 4, 2000.
    Rehearing Overruled June 2, 2000.

      John W. Donovan, Houston, for appellant.
    Tandra Janene Charles, Houston, for appellee.
    Panel consists of Justices COHEN, HEDGES, and ANDELL.
   OPINION

ADELE HEDGES, Justice.

Appellant, Ray Lotfi, sued appellee, Audburgh D. Williams, individually and as trustee, for tortious interference with an earnest money contract. The jury found Williams liable and awarded damages of $1,000. The trial court rendered judgment on the verdict. Williams does not appeal the finding of liability. Lotfi appeals the damages portion of the judgment. We affirm.

Facts

On October 17, 1995, Ray Lotfi (Buyer # 1) and Tamara Green (Seller) entered into an earnest money contract for a piece of real property. The contract provided that Buyer # 1 would pay $40,000 at closing, which would take place a month later on November 17, 1995. On November 2, 1995, Buyer # 1 filed the contract in the Harris County Deed records. Buyer’s #l’s incidental expenses for preparation of the loan and closing documents were $360.

On November 13, 1999, four days before Buyer # l’s closing date, Seller sold the property to appellee, Audburgh D. Williams (Buyer # 2), for a higher price of $65,000. This case is not about Buyer # 1 suing Seller for breach of contract. In this case, Buyer # 1 sued Buyer # 2 for tor-tious interference with the existing earnest money contract between Buyer # 1 and Seller. A jury found that Buyer # 2 intentionally interfered with the earnest money contract, acting without malice. Buyer # 2 does not appeal that finding of liability-

The jury awarded Buyer # 1 damages of $1,000. Buyer # 1 moved to disregard the jury findings, arguing that he conclusively proved his damages were $25,360 and that the trial court should have rendered judgment for that amount. The trial court denied the motion and rendered judgment on the verdict. Buyer # 1 appeals the damages portion of the judgment and seeks rendition of the judgment for $25,-360 in damages.

Damages for Tortious Interference

In two points of error, Buyer # 1 contends that: (1) the jury’s award of $1,000 has no support in the evidence, is contrary to the conclusive evidence, and against the great weight and the preponderance of the evidence and (2) the trial court erred in denying his motion to disregard the jury findings.

The court’s charge asked the jury to consider the following elements of damages, if any, and none other:

a. The difference in value that [Buyer # 1] agreed to purchase the property from [Seller] and the value for which it sold; and/or
b. Reasonable and necessary costs and expenses incurred by [Buyer # 1] in performing the Earnest Money Contract dated October 17,1995.

(Emphasis added).

It is important to note that the charge stated “and/or” between the two elements of damages. As written, the jury had the option to award either the first element only, or the second element only, or both.

Buyer # 1 contends that the evidence conclusively established that his damages were $25,360, which is comprised of: (1) the difference between the value that he agreed to purchase the property and the value for which it sold to Buyer # 2 ($65,-000 — -$40,000 = $25,000) plus (2) his incidental expenses of $360.

Buyer # 1 did not object to the “and/or” language in the charge. Nor did he request that the charge strike the “or” language, which would have forced the jury to award both elements of damages. Thus, he has waived any error. Tex.R.App. P. 33.1(a). Accordingly, we do not decide if the “and/or” language in the charge was proper.

By the $1,000 verdict, it appears that the jury used the “or” instruction to award the second element of damages — the reasonable and necessary costs and expenses incurred by Buyer # 1 in performing the earnest money contract. However, Buyer’s # l’s incidental expenses for preparation of the loan and closing documents were $360.

Although Buyer # l’s point of error states that the $1,000 award was not supported by the evidence, he does not assert that $360 should have been the proper amount of reasonable and necessary costs and expenses. In other words, he does not request that his award be reduced from $1,000 to $360. Instead, he requests that his award be increased from $1,000 to $25,360.

Based on Buyer # l’s relief requested, he asserts that the jury should have awarded both elements of damages for a total of $25,360. As set forth above, because Buyer # 1 did not object to the charge, any error was waived.

We overrule points of error one and two.

Conclusion

We affirm the judgment of the trial court.


author: BEA ANN SMITH, Justice.

text:
    ENTEX, a Division of Reliant Energy Resources Corp., formerly known as Entex, a Division of Noram Energy Corp., Appellant, v. RAILROAD COMMISSION OF TEXAS, Appellee.
    No. 03-99-00746-CV.
    Court of Appeals of Texas, Austin.
    May 11, 2000.

      John F. Williams, Clark, Thomas & Winters, P.C., Austin, for appellant.
    Amanda Atkinson Gagle, Nancy E. 01-inger, Asst. Attys. Gen., Natural Resources Division, Austin, for appellee.
    Before Chief Justice ABOUSSIE, Justices KIDD and B.A. SMITH.
   BEA ANN SMITH, Justice.

Appellant Entex, a division of Reliant Energy Resources Corp., appeals a trial court judgment affirming an order by ap-pellee, the Railroad Commission of Texas (Commission). The issue presented is what rates a utility must charge when it purchases a gas distribution facility from another utility. The Commission ordered Entex, the acquiring utility, to continue charging the rates of the utility from which it acquired a new facility. The district court affirmed the Commission’s order. Because'we determine the Utilities Code only requires Entex to charge its own authorized rates and precludes it from charging any other rates, we will reverse the judgment and the order and remand to the Commission.

FACTS AND PROCEDURAL BACKGROUND

Entex operates natural gas distribution systems in East Texas. In October 1993, Entex purchased a small distribution facility from East Texas Industrial Gas Company (ETIG) serving sixty-nine residential customers and two commercial customers in an unincorporated area of Harrison County; these customers were geographically interspersed among Entex’s other customers.

Prior to the sale, ETIG charged its customers rates set by a 1983 order of the Commission (Docket No. 4001). See Tex. R.R. Comm’n, Statement of Intent Filed by East Texas Industrial Gas Company to Change Rates in the Unincorporated Area in Harrison County, Texas, Docket No. 4001 (Gas Utils. Div. Aug. 29, 1983). En-tex charges its customers rates set by a 1993 order of the Commission applicable to the environs of forty-two cities in East Texas, including Marshall in Harrison County. See Tex.R.R. Comm’n, Statements of Intent Filed by Entex, Inc. to Change Residential and Commercial Rates, Docket Nos. 8163-8204 (Legal Div. Feb. 1, 1993) (Docket No. 8187). When Entex purchased the ETIG facility, it charged the seventy-one new customers the rates established for Entex in Docket No. 8187. Entex’s rates were considerably higher than those charged by ETIG.

Following a 1995 audit, the Commission concluded that Entex was overcharging the former ETIG customers. The Commission ordered Entex to charge the seventy-one customers the rates authorized for ETIG in Docket No. 4001 and to refund the overcharges from October 1993 forward, plus accrued interest. See Tex. R.R. Comm’n, Application of Entex, a Division of Noram Energy, for a Stipulation and Request for a Declaratory Order With Regard to the Rates in the Environs of Marshall, Harrison County, Texas, Docket No. 8646 (Legal Div. June 22, 1999) (Docket No. 8646). The Commission made twenty-nine findings of fact and entered thirteen conclusions of law. Entex sought judicial review of the order, and the trial court affirmed.

DISCUSSION

Entex raises one point of error, arguing that it properly charged the seventy-one customers the only rates it was authorized to charge in the area. Thus, Entex asserts that the Commission’s order is erroneous as a matter of law. The Commission argues the conclusions of law support its order on several bases. First, the “filed rate doctrine,” codified at section 104.005(a) in the Texas Utilities Code, prohibits Entex from charging rates other than those established for ETIG’s customers by Docket No. 4001. See Tex. Util. Code Ann. § 104.005(a) (West 1998). Second, Entex increased the rates of the former ETIG customers without following the procedures for a rate increase required by the Texas Utilities Code and the Texas Administrative Code. See id. §§ 104.102-.103 (West 1998); 16 Tex. Admin. Code § 7.7 (1999). Third, ETIG customers had an implied contract with ETIG to be charged the lower rates; in purchasing the facility, Entex assumed the obligation to continue charging these rates when it purchased the facility and breached this obligation by charging its own higher rates.

We review the Commission’s order under the substantial evidence standard of review. See Tex. UtiLCode Ann. § 105.001 (West 1998). According to the substantial evidence rule, an order that is erroneous as a matter of law must be reversed and remanded for further proceedings if it prejudices-substantial rights of the appellant. See Tex. Gov't Code Ann. § 2001.174(2)(D) (West 2000). Under the substantial evidence standard of review, administrative determination of a question of law is not entitled to a presumption of validity. See Teacher Retirement Sys. v. Cottrell, 583 S.W.2d 928, 930 (Tex.Civ.App.—Austin 1979, writ refd n.r.e.). Questions of statutory interpretation are questions of law; therefore, we are not bound by the Commission’s construction of a statute. See id. However, the Commission’s interpretation is entitled to serious consideration if it is reasonable and does not contradict the plain language of the statute. See Dodd v. Meno, 870 S.W.2d 4, 7 (Tex.1994).

I. The Filed Rate Doctrine

The United States Supreme Court established the filed rate doctrine to address the unique situation in which a utility files tariffs with- a regulatory agency. See Keogh v. Chicago & Northwestern Ry., 260 U.S. 156, 163, 43 S.Ct. 47, 67 L.Ed. 183 (1922). The doctrine prohibits regulated utilities from “charging rates for their services other than those properly filed with the appropriate regulatory authority.” Southwestern Bell Tel. Co. v. Metro-Link Telecom, Inc., 919 S.W.2d 687, 692 (Tex.App.—Houston [14th Dist.] 1996, writ denied). The filed tariff has the effect of law governing the relationship between the utility and its customers. See id. The doctrine operates “across the spectrum of regulated utilities” and applies “where state law creates a state agency and a statutory scheme pursuant to which the state agency determines reasonable rates.” Id. at 692-93 (citing Arkansas La. Gas Co. v. Hall, 453 U.S. 571, 579, 101 S.Ct. 2925, 69 L.Ed.2d 856 (1981)).

The Texas Legislature codified the filed rate doctrine in the Texas Utilities Code at section 104.005(a). See Tex. UtiLCode Ann. § 104.005(a). That section states: “A gas utility may not directly or indirectly charge ... a person a greater or lesser compensation for a service provided ... by the utility than the compensation prescribed by the applicable schedule of rates filed under Section 102.151.” Id. (emphasis added).

The parties agree the filed rate doctrine is applicable, but reach opposite conclusions as to how the doctrine applies to these facts. The Commission argues the filed rate doctrine requires Entex to charge its acquired customers the rates filed by ETIG. If so, Entex violated section 104.005(a) by charging its own higher rates. The Commission’s fourth conclusion of law states that the filed rate doctrine “prohibits Entex from charging the customers of the former ETIG system any rates other than those established in [Docket] No. 4001.” Entex argues the applicable filed rate is the tariff filed by the utility providing the service. Entex understands the filed rate doctrine to require Entex to charge all its customers the same rates. Based on this belief, when Entex began providing the former ETIG customers with natural-gas service in October 1993, it charged them the rates authorized in its Docket No. 8187. To determine the effect of the filed rate doctrine in this situation, we must decide if the governing tariff referenced in section 104.005(a) is the rate applicable to the customers or the rate applicable to the utility.

The Commission admits the Utilities Code is ambiguous as to which schedule of rates is referenced in section 104.005(a). But it argues that the Code is intended to protect ratepayers from rate increases by requiring a utility to file a statement of intent with the Commission, give notice in the appropriate county, and allow customers an opportunity to object to the increase before raising rates. See Tex. UtiLCode Ann. §§ 104.102, .103, .105. The Commission contends these procedural protections against rate increases afford ratepayers a “legally cognizable and protected interest” in their tariffed rates, and this interest should compel this Court to hold that the customers’ rates are found in the applicable schedule of rates referenced in section 104.005(a). But we note that the Code’s purpose is “to assure rates, operations, and services that are just and reasonable to the consumers and to the utilities.” Id. § 101.002(a) (West 1998) (emphasis added). This policy does not dictate favoring the consumer over the utility as urged by the Commission. The fundamental rule controlling our construction of the section is to ascertain the intention of the legislature as expressed in the language of the statute. See State v. Terrell, 588 S.W.2d 784, 786 (Tex.1979). In ascertaining this intent, courts must examine the entire statute and not merely an isolated portion. See id.

Section 104.005(a) refers to the “applicable schedules of rates filed under section 102.151.” Tex. Util.Code Ann. § 104.005(a). Section 102.151 gives us some guidance in discerning which rates are applicable in this situation. In plain language, the section tells us the applicable schedule of rates is the one “in effect for a ... service ... offered by the gas utility.” Id. § 102.151(a)(2) (West’ 1998). It does not say the applicable rate is the one offered to specific customers. Reading sections 102.151 and 104.005(a) together, as we must, we hold that the Legislature intended that a utility must charge the rates prescribed by the schedule applicable to services offered by that utility and may not charge the rates of another utility that previously offered services to customers now added to the present utility’s system. The statute cannot reasonably be read to refer to the customers’ rates as the applicable schedule of rates. We therefore decline to read section 104.005(a) as a guarantee that rates charged by a previous provider will continue in effect after that utility has discontinued its service. Entex has filed the tariff approved in Docket No. 8187 with the Commission. Section 104.005(a) prohibits Entex from charging rates filed by another utility. We will not interpret the “applicable schedule of rates” in a manner that requires Entex to violate the statute itself. See Clint Indep. Sch. Dist. v. Cash Inv., Inc., 970 S.W.2d 535, 539 (Tex.1998).

This result is supported by the functions of the filed rate doctrine. Eirst, the governing regulatory body determines the reasonableness of the utility’s rates. See Mincron SBC Corp. v. Worldcom, Inc., 994 S.W.2d 785, 789 (Tex.App.—Houston [1st Dist.] 1999, no pet.). As recently as 1993, the Commission determined Entex’s rates were reasonable for utility customers in the Marshall environs. Second, the doctrine prevents discrimination in prices among customers receiving the same service. See id. Allowing a utility to vary its rates among its customers “would open the door for discrimination by the utility.” Metro-Link, 919 S.W.2d at 693. If Entex charged the lower rates established for ETIG in Docket No. 4001 to seventy-one customers and the higher rates established in Docket No. 8187 to all the rest, it would be discriminating among its customers in the area. Our interpretation of the statute prevents different customers in the unincorporated area of Harrison County who are served by the same utility from being charged different rates. This result may seem harsh to the former ETIG customers, but the United States Supreme Court has acknowledged this as a possibility under the filed rate doctrine. See Maislin Indus, v. Primary Steel, Inc., 497 U.S. 116, 126-27, 110 S.Ct. 2759, 111 L.Ed.2d 94 (1990). Customers may have an implied contract with one utility that it will continue to charge its tariffed rates until it follows the statutory procedures for raising the rates, but they have no guarantee that the same utility will continue to serve them. When a new utility offers service to these customers at its tariffed rates, those rates have been determined reasonable for the new utility in that area.

This result also comports with other statutory prohibitions on discrimination by a gas utility. See Tex. Util. Code Ann. §§ 104.004, 121.104(a)(2) (West 1998). Section 121.104 prohibits a pipeline gas utility from directly or indirectly charging “greater or lesser compensation for a service provided than the compensation charged ... for a similar and contemporaneous service.” Id. § 121.104(a)(2). The Commission found Entex’s service to the former ETIG customers was not “like and contemporaneous” to its service to other customers because the new customers “did not have notice or an opportunity to participate in Entex’s last rate case before the acquisition of the ETIG system.” The term “similar and contemporaneous” cannot refer to whether customers had equal input into the process resulting in the rates. If this were the case, then every new customer who moves into a gas utility’s service area would have a legitimate claim of discrimination under this section because that customer “did not have notice or an opportunity to participate” in the last rate case. Because contested rate cases are expensive and time-consuming, we do not believe the Legislature intended the statute to be read as allowing potential claims every time a new customer moves into the utility’s service area or is brought in by extended service. See Southwestern Bell Tel. Co. v. Public Util. Comm’n, 863 S.W.2d 754, 757 (Tex.App.—Austin 1993, writ denied). It is enough that customers generally have been involved in the hearing process; it is not necessary that each individual customer added after the hearing be able to participate in a new hearing.

We hold the filed rate doctrine requires Entex to charge only its authorized rates established in Docket No. 8187 and prohibits it from charging any other rates. The Commission’s order requiring Entex to charge rates established for another utility in Docket No. 4001 is erroneous as a matter of law. Unless this order can be sustained on other grounds, we are required to reverse it. We turn now to the Commission’s alternative arguments.

II. Procedural Requirements

The Commission argues that Entex essentially increased the rates it charged the seventy-one customers without following statutory and regulatory procedure. Raising rates without going through proper statutory procedures is unlawful. See Railroad Comm’n v. Moran Utils. Co., 728 S.W.2d 764, 768 (Tex.1987). In determining whether Entex increased its rates, the Commission urges us to look at the increase from the customer’s perspective and not from the utility’s perspective. From the viewpoint of the customers, the rates increased; for one customer the rate went from $6.00 to $12.92 for the same amount of gas.

The Commission relies on a decision in which we considered whether an adjustment in rates based on a tax pass-through constituted a rate increase. See Southwestern Bell Tel. Co., 863 S.W.2d at 757-58. There, we determined the critical inquiry was whether the effect of the tax pass-through resulted in an increase in tariff rates to Southwestern Bell’s customers. See id. at 758. That case is distinguishable from our facts because the court was considering how to characterize an actual adjustment to Southwestern Bell’s own rates. See id. The facts did not involve rates charged by a previous provider. Here, Entex did not adjust its rates, but continually charged the only rates it was authorized to charge.

We agree with Entex that it did not increase its rates, but instead extended to new customers the rates it was authorized to charge. Section 104.102(a) says a “gas utility may not increase its rates unless the utility files a statement of its intent with the regulatory authority....” Tex. Util.Code Ann. § 104.102(a) (emphasis added). A statement of intent is filed only when the utility proposes to increase its own rates, not when it charges its existing rates to new customers. Because Entex did not increase its rates, Entex was not obligated to follow the procedural requirements associated with rate increases.

III. Implied Contract

Finally, the Commission argues ETIG had an implied contract with its customers to maintain its rates, that Entex assumed this contract when it purchased ETIG’s gas distribution facility, and that Entex breached this contract when it charged higher rates. Whether or not this should be the law, we find no existing authority for the proposition. The Commission cites to the Transition Agreement between Entex and ETIG as evidence that Entex assumed the obligation to maintain ETIG’s former rates. According to the agreement, ETIG sold Entex “rights, duties and obligations with respect to the sale or transportation of gas to such customers.” We note that this section of the contract deals with Entex’s obligation in the transition phase, and not with obligations to customers generally. We have already dismissed the notion that the customers had a contractual right for ETIG to remain in service. See supra at 8. Furthermore, we have held Entex is prohibited by section 104.005(a) from charging its customers any rates other than those authorized by the Commission in Docket No. 8187. See supra at 7; Tex. UtiLCode Ann. § 104.005(a). We reject the Commission’s contention that the seventy-one gas customers affected here have an enforceable contractual right distinct from Entex’s other customers. “[N]o one has a vested right in any particular utility rate, but only a statutory right shared with others to have rates that are ‘just ... and reasonable,’ as fixed by the appropriate regulatory body....” Lopez v. Public Util. Comm’n, 816 S.W.2d 776, 783 (Tex.App.—Austin 1991, writ denied). ETIG’s former customers are entitled to the rights shared with Entex’s other customers, that is, the right to be charged the just and reasonable rates established in Docket 8187.

CONCLUSION

We hold the Commission’s order requiring Entex to charge ETIG’s rates and to refund the overcharges to former ETIG customers was erroneous as a matter of law. Therefore, we reverse the judgment below and the Commission’s order and remand the cause to the Commission for entry of an order consistent with this holding.

      . Entex is identified as a division of Noram Energy Corp. in the administrative record. Noram Energy Corp. subsequently changed its name to Reliant Energy Resources Corp.

      . An environs rate is one of two kinds of residential and commercial rates subject to the Commission's original jurisdiction. See 16 Tex. Admin. Code § 7.7(a) (1999). Environs rates include services to "unincorporated areas adjacent to or near incorporated cities and towns.” Id.

      . Both parties contend that the other has engaged in a collateral attack on previous Commission proceedings. The Commission lacks authority to review in a judicial capacity its orders that have become final. See Public Util. Comm’n v. Brazos Elec. Power Coop., Inc., 723 S.W.2d 171, 173 (Tex.App.—Austin 1986, writ refd n.r.e.). It cannot re-open a final proceeding. See id. To do so would constitute an unlawful collateral attack. Neither party is seeking to amend either Docket No. 4001 or 8187 in a way that constitutes a collateral attack that would require us to address this argument.

      . In addition to procedural requirements, the Commission argues that the rate order establishes an implied contract between the utility and its customers. See City of El Paso v. Public Util. Comm’n, 839 S.W.2d 895, 918 (Tex.App.—Austin 1992), aff'd in part, rev’d in part on other grounds, 883 S.W.2d 179 (Tex.1994). Pursuant to this implied contract, customers have a right to pay their rates until they are properly changed. See id. We subsequently address this argument, but mention it here because the Commission says such an implied contract supports the ratepayers’ right to their tariffed rates.

      . The Commission’s argument that the former ETIG customers are entitled to “special rates” rather than "environs rates” is not helpful. Whether the former ETIG customers were subject to a "special rate” or an "environs rate” is not relevant because the pertinent question is what Entex is authorized to charge. Entex may not charge a "special rate” merely because former ETIG customers were so designated by a previous order not involving Entex.

      . We note that Entex’s customers are free to file a complaint challenging unreasonable rates at any time. See Tex. Util.Code Ann. § 104.151(a) (West 1998).

      . The Commission also argues that this Court’s consideration of the public interest in determining a rate increase in another case requires us to look at these facts from the customers’ perspective. See Texas Ass'n of Long Distance Tel. Cos. (TEXALTEL) v. Public Util. Comm’n, 798 S.W.2d 875, 886 (Tex.App.—Austin 1990, writ denied). At issue in that case was the Public Utility Commission's (PUC) authorization of a rate increase. See id. This Court said the PUC has broad discretion in designing its utility rate structure, but one of the factors the PUC must consider is the public interest, "including the impact that large rate increases would have on the utility’s customers (‘rate-shock’).” Id. However, ours is not a case in which the Commission is examining a proposed rate increase. The Commission has already taken into account the public’s interest and determined that En-tex’s rates are just and reasonable in Docket No. 8187.

      . The Commission cites to Amarillo Gas Co. v. City of Amarillo for the proposition that the gas company and the consumer have an implied contract that the "gas would be paid for at the rate established by the ordinance then in effect.” 208 S.W. 239, 240 (Tex.Civ.App.—Amarillo 1919, no writ). We agree with En-tex that this case and its progeny are distinguishable because those cases concern retroactive rate-making, a point not at issue here. See TEXALTEL, 798 S.W.2d at 881.

      . The Commission also argues that because Entex purchased all elements of the facility, Entex is subject to regulatory obligations tied to those elements, citing as authority out-of-state regulatory decisions. These decisions are distinguishable to the extent their facts or controlling statutes vary from the facts in this case. See Entergy Servs., Inc., 64 F.E.R.C. 63,026, 1993 WL 566270 (1993) (involving merger in which intervenor expressed concern that cost of merger would be passed to customers); Citizens Utils. Co., 57 C.P.U.C.2d 421 (Cal.P.U.C.1994) (pertaining to law requiring utilities to gain authority to buy telephone exchanges); U.S. West Communications, 149 P.U.R.4th 353, 1994 WL 88275 (Wyo.P.S.C.1994) (considering rates according to statute that required approval prior to "any change in any rate which has been established”).