author: Justice RICHTER. Justice LANG.

text:
    CITY OF GREENVILLE, Texas, Appellant, v. J.W. REEVES, Jr. and Eddie Reeves, d/b/a Floors By Reeves Brothers, Appellee.
    No. 05-04-00740-CV.
    Court of Appeals of Texas, Dallas.
    June 29, 2005.

      James Andrew Bench, Scott, Walker & Bench, Greenville, for Appellant.
    Harold Curtis, Greenville, for Appellee.
    Before Justices BRIDGES, RICHTER, and LANG.
   OPINION

Opinion by

Justice RICHTER.

In this interlocutory appeal, the City of Greenville contends that the trial judge erred in denying its plea to the jurisdiction. We agree. Accordingly, we reverse the trial court’s order denying the plea to the jurisdiction and render judgment dismissing the case against the City for want of jurisdiction.

BACKGROUND

Claiming that the City had failed to pay for flooring material and labor provided in the construction of a City fire station, ap-pellees filed a lawsuit against the City alleging breach of an oral contract and, in the alternative, quantum meruit. The City answered this action, asserting, among other things, the defense of sovereign immunity. The City also filed a plea to the jurisdiction, again asserting immunity from suit. The trial court denied the plea, and this appeal ensued. See Tex. Civ. Prag. & Rem.Code Ann. § 51.014(a)(8) (Vernon Supp. 200-05) (allowing interlocutory appeal from order denying plea to jurisdiction).

DISCUSSION

Appellees argue that the trial court properly denied the City’s plea to the jurisdiction because the City’s immunity from suit was waived by the Texas Legislature in the adoption of section 51.075 of the local government code and by the City in its adoption of section 5 of its city charter. We disagree.

Standard and Scope of Review

A plea to the jurisdiction is a dilatory plea by which a party challenges a court’s authority to determine the subject matter of an action. Bland Indep. Sch. Dist. v. Blue, 34 S.W.3d 547, 554 (Tex.2000). Whether a trial court has subject matter jurisdiction is a question of law to be reviewed de novo. Tex. Natural Res. Conservation Comm’n v. IT-Davy, 74 S.W.3d 849, 855 (Tex.2002). In performing this review, we do not look to the merits of the plaintiffs case but consider only the pleadings and the evidence pertinent to the jurisdictional inquiry. County of Cameron v. Brown, 80 S.W.3d 549, 555 (Tex.2002) (citing Tex. Natural Res. Conservation Comm’n v. White, 46 S.W.3d 864, 868 (Tex.2001)).

Sovereign Immunity

Sovereign immunity protects the State, its agencies, and its officials from lawsuits for damages absent legislative consent. Fed. Sign v. Tex. S. Univ., 951 S.W.2d 401, 405 (Tex.1997). The sovereign immunity of the State inures to the benefit of a municipality to the extent the municipality engages in the exercise of governmental functions. City of Tyler v. Likes, 962 S.W.2d 489, 501 (Tex.1997). According to the supreme court, “[s]over-eign immunity embraces two principles: immunity from suit and immunity from liability. First, the State retains immunity from suit, without legislative consent, even if the State’s liability is not disputed. Second, the State retains immunity from liability though the Legislature has granted consent to the suit.” Id. at 405 (citations omitted) (emphasis omitted). When the State contracts with a private person, it waives immunity from liability, but not immunity from suit. Id. at 408. Immunity from suit bars a suit against the State unless the State expressly gives its consent to the suit. Id. at 405. The State may consent to suit by statute or by legislative resolution. Id. Express consent is required to show that immunity from a breach of contract suit has been waived. Travis County v. Pelzel & Assocs., Inc., 77 S.W.3d 246, 248 (Tex.2002). Legislative consent for suit or any other sovereign immunity waiver must be “by clear and unambiguous language.” Tex. Gov’t Code Ann. § 311.034 (Vernon Supp.2005); Pelzel, 77 S.W.3d at 248; Fed. Sign, 951 S.W.2d at 405. When determining whether there is a clear and unambiguous waiver of immunity from suit, we generally resolve any ambiguity in favor of retaining immunity. Wichita Falls State Hosp. v. Taylor, 106 S.W.3d 692, 697 (Tex.2003).

Section 51.075

Appellees contend section 51.075 of the Texas Local Government Code waives the City’s immunity from suit. Section 51.075 provides that a home-rule municipality “may plead and be impleaded in any court.” Tex. Local Gov’t Code Ann. § 51.075 (Vernon 1999). In construing this language, we have previously concluded that section 51.075 is not a clear and unambiguous waiver of the City’s immunity from suit. City of Dallas v. Reata Constr. Corp., 83 S.W.3d 392 (Tex.App.-Dallas 2002), rev’d on other grounds, 47 Tex. Sup.Ct. J. 408, 2004 WL 726906 (Tex. Apr. 2, 2004) (per curiam).

Appellees ask us to reconsider this conclusion. We revisited this issue recently in City of Carrollton v. McMahon Contracting, L.P., 134 S.W.3d 925 (Tex.App.-Dallas 2004, pet. filed). In deciding McMahon, we used the four factors set forth by the supreme court in Taylor to determine whether the Legislature has clearly and unambiguously waived sovereign immunity: (i) the statute waives immunity beyond doubt; (ii) ambiguities are resolved in favor of retaining immunity; (iii) if the Legislature requires the State be joined in a lawsuit in which immunity would otherwise attach, the Legislature has intentionally waived the State’s sovereign immunity; and (iv) whether the statute also provides an objective limitation on the State’s potential liability. See Taylor, 106 S.W.3d at 697-98; see also City of Mexia v. Tooke, 115 S.W.3d 618, 623-24 (Tex.App.-Waco 2003, pet. granted). We concluded that section 51.075 is not meaningless without waiver of immunity because the section could speak to a city’s capacity to participate in litigation when immunity has been waived or to take action to preserve immunity. See McMahon, 134 S.W.3d at 927. We also noted that often a statute will provide that “sovereign immunity to suit is waived” or use similar unambiguous language when the Legislature intends to waive immunity. See id. We did not apply the third or the fourth Taylor factors because neither is implicated in section 51.075. Based on this review, we again concluded that section 51.075 does not effect a waiver of the City’s immunity “by clear and unambiguous language.” See McMahon, 134 S.W.3d at 928.

We again note that the supreme court has never held that the language “plead and implead” is a clear and unambiguous waiver of immunity from suit. See id. Therefore, we decline to reconsider our previous holdings, and we thus conclude that section 51.075 does not constitute a clear and unambiguous waiver of the City’s immunity from suit.

Section 5 of the City Charter

Section 5 of the City charter, which is entitled “Powers of the City,” states that the City may “sue and be sued” and may “plead and be impleaded in all courts.” We have previously held that identical language in a city charter provision that specifically enumerated the city’s powers did not waive the city’s sovereign immunity. See Reata, 83 S.W.3d at 398. We reiterate that holding here. This language in the City’s charter simply speaks to the City’s capacity to sue and its capacity to be sued when immunity has been waived. See id.

We sustain the City’s sole issue and hold the trial judge erred in denying the City’s plea to the jurisdiction. We reverse the trial court’s order denying the plea to the jurisdiction and render judgment dismissing the case against the City for want of jurisdiction.

CONCLUSION

LANG, J. concurring.

Concurring Opinion by

Justice LANG.

Respectfully, I concur with the majority opinion of my colleagues concluding that the City of Greenville’s sovereign immunity from suit has not been waived. Although I support the result, my reasoning is somewhat at variance with that of the majority.

As set forth in detail below, it is my view that the decision that the City has not waived its immunity from suit should be based on these principles:

(1) If immunity is waived in this case, it must be premised on the language of section 51.075, not the City Charter. See Greenville, Tex., ChaeteR art. II, § 5 (1953). Only the legislature may waive sovereign immunity from suit. Fed. Sign v. Tex. S. Univ., 951 S.W.2d 401, 405 (Tex.1997).
(2) We must specifically analyze the meaning of the language of section 51.075, which states, “The municipality may plead and be impleaded in any court,” pursuant to the rules set out in the Code Construction Act and the guidelines enunciated by the Texas Supreme Court. Tex. Gov’t Code Ann. §§ 311.001-.034 (Vernon 2005); Wichita Falls State Hosp. v. Taylor, 106 S.W.3d 692, 697-98 (Tex.2003); City of Mexia v. Tooke, 115 S.W.3d 618, 622-23 (Tex. App.-Waco 2003, pet. granted).

I. CONTENTIONS OF THE PARTIES

Appellees filed a lawsuit against the City claiming a breach of an oral contract and, in the alternative, quantum meruit. The substance of the claims was that the City failed to pay for flooring material and labor provided to the City in the construction of a fire station. The City asserted the defense of sovereign immunity and also filed a plea to the jurisdiction. In response, appellees argued that the City’s immunity from suit was waived by the Texas Legislature’s adoption of section 51.075 of the Local Government Code. Section 51.075 applies to home rule cities and provides: “The municipality may plead and be impleaded in any court.” Tex. Loc. Gov’t Code Ann. §§ 51.071, .075 (Vernon 1999). Also, according to appellees, the waiver is embodied in article II, section 5 of the City Charter, which provides that the City, among other corporate powers, “may sue and be sued” and may “implead and be impleaded.” Greenville, Tex., Chabter art. II, § 5 (1953).

II. IMMUNITY FROM SUIT PROPOSITION

The majority properly sets out the general legal propositions describing sovereign immunity from suit in Texas. Critical to the analysis in this case is the doctrine that a governmental entity waives its sovereign immunity from liability when it enters into a contract, but that same act of contracting does not waive immunity from suit whereby a contracting party may sue the governmental entity on that same contract. Fed. Sign, 951 S.W.2d at 408. Rather, the State retains immunity from suit, unless there exists legislative consent, even where the State’s liability is not disputed. Id. at 405; Mo. Pac. R.R. Co. v. Brownsville Navigation Dist., 453 S.W.2d 812, 813 (Tex.1970); Satterfield & Pontikes Constr., Inc. v. Irving Indep. Sch. Dist., 123 S.W.3d 63, 70 (Tex.App.-Dallas 2003, pet. filed) (Lang, J., dissenting). The State must expressly give its consent to be sued “by clear and unambiguous language,” and such consent may be by statute or by legislative resolution. Fed. Sign, 951 S.W.2d at 405.

The City argues that neither the statute nor the Charter provides the “clear and unambiguous language” required for the trial court to find waiver of immunity from suit. However, in my view, the sole means of determining whether there has been a waiver is to scrutinize the statute. It is only the legislature which is empowered to declare the waiver. The City asserts that the “plead and be impleaded” language in the statute is not clear and unambiguous. I agree. The Texas Supreme Court has concluded, in Missouri Pacific, that “sue and be sued,” standing alone, constitutes a waiver of sovereign immunity from suit. See Mo. Pac. R.R. Co., 453 S.W.2d at 813 (holding language “quite plain and gives general consent” for governmental entity to be sued in courts in same manner as other defendants). However, the supreme court has not made any such conclusion as to “plead and be impleaded,” as that language stands alone in section 51.075. Tooke, 115 S.W.3d at 622-23.

III. ANALYSIS

If there is a waiver, we must find it in an enactment of the legislature, not in the Charter. See Fed. Sign, 951 S.W.2d at 405 (“The State may consent to suit by statute or by legislative resolution.”) (citing Mo. Pac. R.R., Co., 453 S.W.2d at 814). The City, in this context, cannot subvert the will of the legislature by inserting language in its Charter. Rather, the City’s home-rule power, in this context, is created by the legislature and is subject to the legislature’s authority. See Tex. Loc. Gov’t Code Ann. § 51.077 (Vernon 1999). Section 51.077 authorizes the City to “adopt rules, as it considers advisable, governing the municipality’s liability for damages caused to a person or property. The municipality may provide for its exemption from liability.” Id. (emphasis added). Since the case before us involves a breach of contract claim, no issue is before us as to whether the City or the legislature has waived “liability.” It has long been the rule that a governmental entity waives immunity from “liability” when it enters into a contract. Fed. Sign, 951 S.W.2d at 408. By its very language, section 51.077 addresses cases only where sovereign immunity from “liability” is preserved by the legislature. Accordingly, I respectfully suggest that the resolution of the issue before us turns only on the language of section 51.075, “plead and be impleaded.”

The majority relies on our previous decision in City of Dallas v. Reata Construction Corp., 83 S.W.3d 392 (Tex.App.-Dallas 2002), rev’d on other grounds, 47 Tex. Sup.Ct. J. 408, 2004 WL 726906 (Tex. Apr. 2, 2004) (per curiam) (motion for rehearing granted Oct. 16, 2004), in concluding that the language in section 51.075 is not a clear and unambiguous waiver of immunity from suit. Even though the Texas Supreme Court has overruled Reata on an issue which is different from that before us, I suggest that the reasoning in this Court’s opinion in Reata is inapplicable to the issues before us.

First, Reata is a negligence and premises liability case. In my view, that subject matter should be treated differently from an issue of sovereign immunity respecting suit on a contract. See Satterfield, 123 S.W.3d at 79 (Lang, J., dissenting).

Second, I differ with the reasoning of Reata. In Reata, this Court considered whether “plead and be impleaded” in section 51.075 and “sue and be sued” and “to implead and be impleaded” in the city charter waived sovereign immunity. This Court considered these statutory and charter provisions without applying standards or tests and decided these provisions did not expressly waive sovereign immunity. Reata Constr. Corp., 83 S.W.3d at 398. Rather, this Court said the phrases “simply speak to the City’s capacity to sue and its capacity to be sued when immunity has been waived.” Id.; accord Satterfield, 123 S.W.3d at 66. However, Reata did not cite Missouri Pacific.

The conclusion of the majority in Reata that such clauses address “capacity” is based upon the Houston Fourteenth Court of Appeals’s decision in Jackson v. City of Galveston, 837 S.W.2d 868, 871 (Tex.App.Houston [14th Dist.] 1992, writ denied), which has been abandoned by that court in its Clear Channel opinion. See City of Houston v. Clear Channel Outdoor, Inc., 161 S.W.3d 3, 7 (Tex.App.-Houston [14th Dist.] Jan. 15, 2004, pet. filed). This Court in Satterfield cited Reata and the Kraehe law review article for the now-abandoned “capacity” proposition. The law review article expressly relies upon Jackson. See George C. Kraehe, “There’s Something About Cities”: Understanding Proprietary Functions of Texas Municipalities and Governmental Immunity, 32 Tex. Tech. L Rev. 1, 35-36 (2000) ; see also Satterfield, 123 S.W.3d at 66.

I contend that we run afoul of the subsisting conclusion in Missouri Pacific by following Jackson in the Reata and Satter-field opinions and by accepting the reasoning of the Kraehe law review article in Satterfield. See Satterfield, 123 S.W.3d at 78 (Lang, J., dissenting). Further, the conclusions in Reata and Satterfield as to the “sue and be sued” and “plead and be impleaded” language referring to “capacity” have been eroded by a change in views by the Fourteenth Court of Appeals, which has refused, at this time, to follow its Jackson precedent. See Clear Channel Outdoor, Inc., 161 S.W.3d at 7.

It is important to note that in Clear Channel, the Fourteenth Court not only relied on Missouri Pacific, but it equated “plead” and “sue” as meaning the same thing, using meanings of those terms obtained from dictionaries. Then it concluded that “sue and be sued” or “plead and be impleaded” is sufficient language to waive immunity from suit. See id. at 7-8. The Fourteenth Court expressly decided to follow Missouri Pacific rather than its prior Jackson decision. Id. As indicated above, the decision in Clear Channel strikes at the heart of the conclusions set out. in Reata, the Kraehe law review article, and Satterfield.

The majority also cites City of Carroll-ton v. McMahon Contracting, L.P., 134 S.W.3d 925, 928 (Tex.App.-Dallas 2004, pet. filed), for its reaffirmation of reasoning in Reata that the “may plead and be impleaded” language in section 51.075 is not a clear and unambiguous waiver of the City’s immunity from suit. While I disagree with McMahon on the use of the reasoning in Reata, I agree with that opinion where this Court said we do not support the reasoning or ultimate conclusion of our sister courts of appeals to the effect that “sue and be sued” and “plead and be impleaded” are equivalent and indistinguishable. See Clear Channel, 161 S.W.3d at 7-8; Goerlitz v. City of Midland, 101 S.W.3d 573, 577 (Tex.App.-El Paso 2003, pet. filed); Knowles v. City of Granbury, 953 S.W.2d 19, 23 (Tex.App.-Fort Worth 1997, writ denied); Avmanco, Inc. v. City of Grand Prairie, 835 S.W.2d 160, 164-65 (Tex.App.-Fort Worth 1992, writ dism’d as moot).

I would not follow the approach of the courts of appeals in Goerlitz, Knowles, and Avmanco where they reached conclusions without applying standards or tests or the dictionary definition analysis used by the Fourteenth Court in Clear Channel. Instead, I conclude that some of the Waco Court of Appeals’s reasoning in Tooke, which concludes “that section 51.075 does not constitute a legislative waiver of a home-rule municipality’s immunity from suit,” Tooke, 115 S.W.3d at 624, and the guidelines enunciated by the Texas Supreme Court in Taylor, 106 S.W.3d at 697-OS, are applicable here.

In Tooke, the City of Mexia contracted for curbside collection of brush and leaves in the city. Tooke, 115 S.W.3d at 620. After the city notified the contractor that its services were not required due to budget limitations, the contractor sued the city for breach of contract. The trial court denied the city’s plea to the jurisdiction, and the city was found liable for damages and attorney’s fees. The city appealed, arguing that section 51.075 does not constitute a waiver of immunity from suit for home rule municipalities. Thus, the Tooke court was called upon to determine whether “plead and be impleaded” waived a home rule municipality’s immunity from suit. Id. at 622.

The analysis in Tooke that invokes the Code Construction Act provides the test which should guide us to the proper, reasoned result in this case. Id. at 623 (citing Tex. Gov’t Code Ann. § 311.021(2) (“In enacting a statute, it is presumed that: ... (2) the entire statute is intended to be effective;.... ”)). Specifically, pursuant to the Code Construction Act, we must presume that the legislature intended the entirety of the Local Government Code to be effective. Id. (citing Tex. Gov’t Code Ann. § 311.021(2)). We presume that the legislature used every word for a particular purpose. Id. (citing City of Austin v. Sw. Bell Tel. Co., 92 S.W.3d 434, 442 (Tex. 2002)).

As Tooke points out, both sections 51.013 and 51.033 address general law municipalities and use the two phrases side by side. Id. at 622-23; see Tex. Loc. Gov’t Code Ann. §§ 51.013 (“The municipality may sue and be sued, implead and be impleaded, and answer and be answered in any matter in any court or other place.”), 51.033 (Vernon 1999) (“The municipality may sue and be sued and may plead and be impleaded.”). Additionally, sections 51.013, 51.033, and 51.075, being part of the Local Government Code, should be construed together and the language harmonized in order for a court to determine the meaning of the language. See Tex. Gov’t Code Ann. § 311.021(2); Indus. Accident Bd. v. Martinez, 836 S.W.2d 330, 333 (Tex.App.-Houston [14th Dist.] 1992, no writ) (applying principle of construction to victim’s compensation act).

I reason that since the two phrases are side by side in sections 51.013 and 51.033, one must presume that the legislature did not intend to be redundant. Likewise, the statutory language “plead and be implead-ed” in section 51.075 implies a separate meaning for that phrase. The legislature must have meant, in this context, that “plead and be impleaded” was not identical in meaning to “sue and be sued.” The legislature has set out in these sections similar, but distinguishable, language to address, inter alia, powers of different classifications of cities. Accordingly, I conclude, based upon the Code Construction Act analysis, that “sue and be sued” and “plead and be impleaded” do not have equivalent meaning in the context of the Local Government Code before us in this case. The phrase “plead and be implead-ed” in section 51.075 has not been defined by the legislature or the Texas Supreme Court. However, it is not necessary to speculate in order to define that phrase to reach our conclusion in this case. I am persuaded that it is sufficient to conclude that “plead and be impleaded” does not mean the same as “sue and be sued” and does not otherwise constitute a waiver of sovereign immunity in the context of the case before us.

Finally, I address the “guidelines” set out in Taylor, 106 S.W.3d at 697-98. Although I believe the use of the guidelines is most meaningful in an analysis of issues of sovereign immunity from tort claims, those guidelines can be helpful in this analysis. As stated by the majority, the third and fourth guidelines suggested in Taylor are not applicable. However, I believe the first two guidelines are addressed by the statutory construction analysis described above. I cannot say that it is “beyond doubt” that the language “plead and be impleaded” expresses a waiver of sovereign immunity. Id. at 697. The application of the Taylor guidelines confirms my conclusion using the Code Construction Act analysis that “plead and be impleaded” in section 51.075 does not communicate the intention of the legislature to waive sovereign immunity.

IV. CONCLUSION

It is the legislature’s prerogative to clarify or change the language in section 51.075. Alternatively, it is the Texas Supreme Court’s prerogative to construe “plead and be impleaded” or to explain any relationship of that phrase to “sue and be sued” in the context of waiver of immunity from suit. Until either the legislature or the Texas Supreme Court acts to clarify whether the language in section 51.075 waives sovereign immunity from suit in the context before us, I cannot conclude that this language is the “clear and unambiguous” language required for waiver.

For these reasons, I concur in the result reached by the majority.

      . The law review article says that one must make assumptions "prohibited by well established law” to conclude that the "sue and be sued” and "plead and be impleaded” language in sections 51.013, 51.033, and 51.075 expresses a waiver of immunity. Kraehe, supra, at 35. However, at least since the Clear Channel opinion, the "well established law” cited in the article is not persuasive, nor does it “prohibit” the analysis. One of the cases cited, Lynch v. Port of Houston Authority, 671 S.W.2d 954 (Tex.App.-Houston [14th Dist.] 1984, writ ref'd n.r.e.), merely tells us that the court of appeals refused to sustain requests that the court abandon what that appellant called the "outmoded” doctrine of sovereign immunity or to conclude that the doctrine of sovereign immunity violates the equal protection and due process clauses of the Fourteenth Amendment to the United States Constitution. See id. at 957. Also, the other case cited in the article is Jackson, from which the Fourteenth Court has distanced itself.

      . The Waco Court of Appeals in Tooke did not address whether any part of the city charter can waive immunity from suit since there was no evidence regarding the city charter in the record. As noted above, the Waco Court in Tooke observed that the Texas Supreme Court has never held this particular language sufficient to constitute a " ‘clear and unambiguous’ waiver of immunity from suit.” Tooke, 115 S.W.3d at 622 (quoting Tex. Gov't Code Ann. § 311.034). Additionally, the Waco Court observed that the Texas Supreme Court has not held that “plead and be impleaded” is equivalent to "sue and be sued.” See id.

      . As stated in Tooke, the supreme court has established "guidelines” to consider in the absence of a clear and unambiguous waiver of immunity: (1) the statute in question must waive immunity "beyond doubt,” for example, whether the provision would be rendered meaningless unless immunity is waived; (2) ambiguities are generally resolved in favor of immunity; (3) if the legislature requires the joinder of a governmental entity in a suit for which immunity would otherwise attach, the legislature has waived immunity; and (4) if the legislature simultaneously enacts legislation limiting the governmental unit's potential liability, a waiver of immunity may be found. Tooke, 115 S.W.3d at 623 (citing Taylor, 106 S.W.3d at 697-98).

      . In 2003, the Texas Legislature amended the Local Government Code by adding section 262.007 regarding "suit against county arising under certain contracts.” See Act of May 29, 2003, 78th Leg., R.S., ch. 1203, § 2, sec. 262.007, 2003 Tex. Gen. Laws 3418; Tex. Loc. Gov’t Code Ann. § 262.007 (Vernon Supp. 2004-05). The bill was entitled "An Act relating to the ability of a county to sue and be sued.” Tex. S.B. 1017, 78th Leg., R.S. (2003). As I stated in my dissent in Satter-field, the purpose stated in the House and Senate committee reports makes it apparent that the legislature acted to amend the Local Government Code in reaction to the Texas Supreme Court's decision in Travis County v. Pelzel & Associates, Inc,, 77 S.W.3d 246 (Tex. 2002). Satterfield, 123 S.W.3d at 81 (Lang, L, dissenting). Pelzel concluded that the absence of "sue and be sued” language in section 89.004 of the Local Government Code reflected the legislature’s intention not to waive immunity from suit in contract claims described in the statute. Id. at 81 (citing Pelzel, 77 S.W.3d at 251).


source: Caselaw Access Project

author: PER CURIAM. KIDD, Justice, CASTILLO, Justice,

license: Public Domain

text:
    UNION CARBIDE v. Audrey Amelia ADAMS, et al.
    No. 03-0895.
    Texas Judicial Panel on Multidistrict Litigation.
    Heard Dec. 12, 2008.
    Decided Dec. 30, 2003.
   THE MOTION FOR TRANSFER IN THE FOLLOWING MULTIDIS-TRICT LITIGATION CASE IS GRANTED AS FOLLOWS:

PER CURIAM.

On December 12, 2003 the Multidistrict Litigation Panel held a hearing on the Motion for Transfer filed by Union Carbide Corporation under Rule 13 of the Texas Rules of Judicial Administration. Having considered the arguments, the evidence, and the authorities presented, a majority of the panel finds that the following cases involve one or more common questions of fact, and that transfer of these cases and tag-along cases to one district judge will be for the convenience of the parties and witnesses and will promote the just and efficient conduct of the eases: Cause No. 03-CV-1402, Audrey Amelia Adams, et al. v. American Standard, Inc., et al., 56th Judicial District Court of Galveston County, Texas; Cause No. 03-10314, Giuseppe Cappelli and Virginia Cappelli v. Allis-Chalmers Corp., et al., 116th Judicial District Court of Dallas County, Texas; and Cause No. 03CV1485, Roy Tittle, et al. v. Quigley Company, Inc., et al., 212th Judicial District Court of Galveston County, Texas. The panel will issue a second order haming the judge to whom the cases will be transferred.

In the event that the pretrial judge or a litigant concludes that one or more additional pretrial judges are needed in the future, the panel will entertain at that time a request to transfer cases to an additional judge or judges.

If cases that are ready for trial are not remanded to the trial court for trial under rule 13.7, the panel will entertain complaints from litigants about the delay and will decide whether to grant relief.

Dissenting opinion filed by Justice KIDD.

Dissenting opinion filed by Justice CASTILLO.

KIDD, Justice,

dissenting.

Over the past quarter of a century, the asbestos litigation docket in Texas has accomplished the monumental feat of disposing of almost 30,000 cases. This success is largely due to the cooperation of counsel on both sides of the asbestos docket and the coordinated effort of hard-working trial judges across this vast state. See In re Ethyl Corp., 975 S.W.2d 606, 610-11 (Tex.1998). The centerpiece of this cooperative effort remains a series of agreed standing pretrial orders and an assigned asbestos judge in ten of our most populous Texas counties, comprising every major metropolitan area in the state. As a result, defense counsel have publicly declared that 99% of all asbestos litigation has been settled amicably. More importantly, unlike some contentious mass-tort litigation, asbestos cases have not involved the trial courts in a number of pretrial hearings because all but a handful of pretrial issues have been concluded by the entry of agreed orders.

In sharp contrast is the federal asbestos experience of the last decade. After the assignment of all pretrial matters in federal asbestos cases to a single federal district court, the federal asbestos docket suffered from that dreaded disease commonly known as “pretrial paralysis.” Dying asbestos victimé watched in horror as their asbestos cases were, quité literally, “pre-tried” to death. See, e.g., In re Patenaude, 210 F.3d 135, 138 (3rd Cir.2000), cert. denied, 531 U.S. 1011, 121 S.Ct. 565, 148 L.Ed.2d 484 (2000).

Today, - a bare majority of this panel seeks to adopt the federal model and assign all prospective asbestos cases to a single, statewide asbestos judge. In light of the federal experience, this action, in my view, disregards the standard to be applied in order to justify such a transfer, which requires that the transfer will be for the convenience of the parties and witnesses and will promote the just and efficient conduct of the case. Therefore, I respectfully dissent to the order of transfer.

CASTILLO, Justice,

dissenting.

Respectfully, I dissent. A party defendant experienced in asbestos litigation filed a response indicating it lacked sufficient information to take a position in favor of granting or denying the motion. Under the presumption that all allegations in the motion and responses are true, the ultimate burden of persuasion and proof remained with Union Carbide. Considering the evidence in the record before us, I would deny the motion to transfer. Turning now to the majority decision, I note that at the heart of the. motion as presented are three cases. I would allow the parties in the tag along cases to show cause why the cases should not be transferred to a pre-trial judge.


author: PER CURIAM.

text:
    In re FIRESTONE/FORD LITIGATION.
    No. 04-0262.
    Texas Judicial Panel on Multidistrict Litigation.
    May 4, 2004.
   THE MOTION FOR TRANSFER IN THE' FOLLOWING MULTIDIS-TRICT LITIGATION CASE IS GRANTED AS FOLLOWS:

PER CURIAM.

On March 19, 2004, Bridgestone/Fire-stone and Ford filed a motion for MDL transfer concerning the following tread-separation cases: Cause No. 2003-5187, Dorothy Aragon, Et Al. v. Bridge-stone/Firestone North American Tire, LLC, Et Al, 327th Judicial District Court of El Paso County, Texas; Cause No. 03-C-780, Ronald D. Ratliff; Et Al. v. Bridge- stone/Firestone North American Tire, LLC, Et Al., 5th Judicial District Court of Cass County, Texas; and Cause No. CV03-51791-43, Julie Pressley, Et Al. v. Bridgestone/Firestone North American Tire, LLC, Et Al., 43rd Judicial District Court of Parker County, Texas. The motion was served on all plaintiffs’ counsel on March 18. A response was due 20 days from service of the motion. See Rule 13.3(d). No response has been filed.

Having reviewed the unopposed motion and the exhibits, the panel has concluded that the cases involve common questions of fact and that transferring them to a pretrial judge would be for the convenience of the parties and witnesses and would promote the just and efficient conduct of the cases.

The motion to transfer is granted, and the cases are transferred to Hon. Michael Mayes, Judge of the 410th District Court of Montgomery County.


author: Justice PEEPLES KIDD, Justice

text:
    In re SILICA PRODUCTS LIABILITY LITIGATION.
    No. 04-0606.
    Texas Judicial Panel on Multidistrict Litigation.
    Heard Oct. 13, 2004.
    Decided Nov. 10, 2004.
   ON REVIEW BY THE MULTIDIS-TRICT LITIGATION PANEL

Justice PEEPLES

delivered the opinion of the Multidistrict Litigation Panel, in which

Justice HANKS and Justice LANG joined.

Since Rule 13 took effect last year, 453 plaintiffs have filed 71 lawsuits involving 158 defendants, alleging injurious exposure to silica. The suits are pending in 55 district courts in 20 counties. Six defendants in these cases have filed a motion asking this panel to appoint a pretrial judge pursuant to Rule 13. The motion is opposed by all the plaintiffs and by 11 defendants. For the reasons stated in this opinion, a majority of the panel has granted the motion and appointed a pretrial judge by separate order issued this date.

Rule 13 authorizes the panel to transfer civil actions that involve one or more common questions of fact to a single pretrial judge if “transfer would be for the convenience of the parties and witnesses and would promote the just and efficient conduct of the cases.” Movants argue that these cases present several common issues that will need uniform and consistent treatment, such as discovery, venue and forum non conveniens, the “sophisticated user” doctrine, Robinson-Havner challenges to expert testimony, the sufficiency of warnings, and other issues concerning common worksites, product identification, and the validity of the diagnosis and screening process. Respondents reply that the cases are working their way smoothly through the legal system with no inconsistent or conflicting rulings at this point; they contend that Rule 13 requires the movants to identify existing problems before the panel may assign a pretrial judge.

Rule 13 seeks to promote the convenience of parties and witnesses and to see that cases with common factual issues are handled in a just and efficient manner. We now consider these goals, bearing in mind the undisputed facts that 453 plaintiffs have filed 71 silica-related lawsuits against a total of 158 defendants, now pending in 55 district courts situated in 20 counties.

1. Convenience of parties and witnesses.

Respondents point out that the movants have not shown that witnesses or parties have already been inconvenienced, either by having to respond to conflicting demands or otherwise. In effect respondents argue that Rule 13 requires the mov-ants to show that there is an existing problem that needs to be corrected. But Rule 13 is not limited to correcting ongoing problems from the past; it seeks to prevent the occurrence of problems in the future. It does not require proof that witnesses have already been inconvenienced; it looks ahead and focuses on whether transferring cases to a pretrial judge would serve the convenience of parties and witnesses by preventing inconvenience in the future.

We think it is undeniable that it is more convenient for witnesses and parties who find themselves involved in several related cases to litigate in one pretrial court instead of several. During the pretrial phase we are confident that it will further the convenience of witnesses and parties to be subject to one consistent set of orders instead of many.

We conclude that granting the motion for transfer to a pretrial judge will promote the convenience of the parties and the witnesses.

2. Just and efficient handling.

Respondents argue that the cases are currently being handled efficiently and without ■ significant disagreement. But even if these cases are currently moving smoothly because the lawyers have been agreeing on pretrial issues, we see no reason why such agreeableness would cease when the pretrial phase of the cases is handled by one judge.instead of fifty-five. If indeed the litigants who have been reaching agreements in different courts around the state begin to set matters for hearing when the cases come before the pretrial judge, that would seem to be a right that the legal system gives them. Rather than viewing this as disagreeableness, we view it as litigants choosing to present their contentions to the legal system for decision. Agreed orders and judgments are certainly to be desired, but litigants must also be able to submit their contentions to the court for decision when they are unable to agree with the other parties.

One virtue of transferring related cases to a single pretrial judge is that issues, once raised, will be decided the same way in the future. A consistent and steady judicial hand at the helm should in fact promote agreements because lawyers will know where the court stands on recurring issues. As contested issues arise, the pretrial judge will make consistent rulings, which can then be reviewed by the appellate courts as appropriate. This, we think, serves Rule 13’s goal that our system give related cases consistent and efficient treatment.

Nor can we ignore what we as judges know from experience — that sometimes it can be difficult for dedicated but busy trial judges to give cases like these the deliberate, thoughtful, and focused pretrial attention they deserve. It is also difficult to give them realistic trial settings, and trial judges may -be tempted to set cases for trial on dates before, they will be truly ready, knowing that many, cases will settle under the pressure of a trial setting. By contrast, to the pretrial judge these cases will not be just one of many cases on a crowded docket competing for attention. Because the pretrial judge will not return the cases to the trial courts until they are ready for trial, we expect her to invest the necessary time and study and to schedule hearings and decide issues in advance of trial.

We conclude that granting the motion for a pretrial judge will promote the just and efficient handling of these cases.

3. Common fact questions.

Movants argue that there are common issues in these cases: discovery, venue and forum non conveniens, the “sophisticated user” doctrine, Robinson-Hav-ner challenges to expert testimony, the sufficiency of warnings, and other issues concerning common worksites, product identification, and the validity of the diagnosis and screening process. There are of course many common defendants and common products, all involving silica in some way. Respondents reply that most of these are not really contested issues and that individual issues predominate. Each personal injury case is indeed different, especially as to causation and damages. Rule 13, however, allows transfer to a pretrial judge when there are common fact issues, even though in a given case the common issues might not outweigh the individual, case-specific issues. We are confident that the pretrial judge will give individual consideration to case-specific issues, while giving consistent, uniform treatment to the common and recurring issues. We also note that .Rule 13 could not be limited to pure questions of historical fact; it extends to mixed questions of law and fact, such as product defect (including adequacy of warnings, and negligence), which our system calls fact questions. We note also that many of the 71 cases involving 458 plaintiffs have been considered sufficiently related to make proper the joinder of multiple plaintiffs in one suit, and that one reason the same lawyers appear repeatedly on both sides of these cases is that the cases have many mixed questions of law and fact in common.

4. Other issues.

Respondents (and the dissent) stress that the six movants are a small minority of the parties in these cases. It is true that most of the defendants have not taken sides on this motion. Six have moved for a pretrial judge; eleven have opposed that motion; the other 141 have remained on the sidelines. But we cannot accept the suggestion that legal rights depend upon the number of litigants who assert them. Rule 18 says that “a party” may move for pretrial transfer. (And of course “a party” may oppose pretrial transfer.) Rule 13’s focus on the rights of the individual party is consistent with our legal system’s belief that in multi-party cases rights inhere in individuals, not groups or coalitions of parties. When one lone litigant in a multi-party case makes an objection or asks for trial by jury, for example, the court does not ask for a show of hands. The same thing is true of Rule 13 motions.

Two other arguments made by the dissenting opinion deserve mention. First, the dissent argues that it will be inconvenient for lawyers to travel to Houston for pretrial hearings instead of appearing in the county of venue. This argument is not persuasive because most of the lawyers opposing the Rule 13 motion will have less distance to travel than before the motion was granted. Several movants are in Houston, where the pretrial judge sits. Most of the others are situated a significant distance from the county of venue and will have a comparable trip (or shorter) to the pretrial court in Houston. Second, while the pretrial judge’s workload will indeed increase, we are puzzled that the dissent stresses this as a reason not to assign her the cases because their argument is, in effect, that there is no real workload.

The respondents and the dissent have argued primarily that these cases do not add to the judges’ current workload because the litigants have been agreeing on most matters. We see no reason why lawyers who have been agreeing cannot

continue to agree when the cases are pending before the pretrial judge. We have been given no reason why lawyers would agree in cases pending before 55 different courts but not when the same cases are handled pretrial by one judge. To the extent that-the pretrial judge’s workload does increase, that would seem to be more than offset by the decreased workload the other 55 judges will collectively enjoy.

⅜ * ⅜ # ⅜

For the reasons stated, we conclude that transfer of these cases tó a pretrial judge will serve the convenience of the parties and the witnesses, and will promote their just and efficient handling. The motion to transfer the silica cases to a pretrial judge is granted.

Justice KIDD filed a dissenting opinion.

Justice CASTILLO not sitting.

KIDD, Justice

dissenting.

The alignment of the parties in this MDL proceeding is so strikingly unusual that it reminds me of the oft-quoted fictional newspaper headlines “Man Bites Dog.” The MDL movants are a small group of collateral defendants who are relative newcomers to silica litigation in Texas. In opposition are the respondents, a surprising coalition led by major silica defendants and joined by the unanimous support of the plaintiffs’ bar. This coalition contends that the movants have failed to meet their burden of proof and that an MDL order of consolidation is unneeded and unwanted. Because I agree that the movants have not carried their burden of proof and that.the MDL consolidation ordered by a majority of this panel is inconvenient, inefficient, and unwise, I respectfully dissent.

BACKGROUND

Burden of proof

The Texas Constitution establishes the district court as the basic trial court in this state. Tex. Const, art. V, §§ 1, 7, 8. Our 422 district courts of general jurisdiction handle all of the pretrial litigation matters from the simple to the complex. The design of this system emphasizes the relationship between judges and their local communities, and the accountability inherent in that arrangement. A strength of this system is that a diverse group of judges across the state bring their collective knowledge and experience to bear on a variety of legal issues rather than leaving them all to a single judge. Within the parameters of the civil justice system, courts may customize their rulings to the particular circumstances of the parties in their communities.

Because MDL consolidation of cases before a single judge is such a drastic change from our conventional civil justice system, the Texas Legislature and Texas Supreme Court have established an extremely onerous burden of proof before MDL consolidation is authorized. The movant must establish that the transfer will (1) be for the convenience of the parties and witnesses, and (2) promote the just and efficient conduct of the action. Tex.R. Jud. Admin. 13, reprinted in Tex. Gov’t Code Ann., tit. 2, subtit. F app. (West Supp. 2004-05) (“Rule 13”). Legislative terms like “convenience” and “efficient” are extremely high thresholds when one is considering thousands of cases being assigned to a single judge who already has a busy trial docket. The tragedy of this case is not that the movants have wholly failed to meet their burden of proof, but that a majority of this panel has tacitly conceded as much.

Silica litigation

For over 80 years, an incredible number of silica injury cases have been disposed of by the Texas courts. U.S. Silica, which has been the major silica supplier and defendant in these cases, opposes MDL consolidation. In its brief and at oral argument, counsel for U.S. Silica described a highly successful method of handling pretrial issues by agreement that rivals any mass-tort system in the country:

As a practical matter, Texas courts are handling the current silica caseload efficiently. Historically, no Plaintiff, Defendant, or Court has sought a state court silica MDL in Texas, despite the existence of the procedure in one form or another since 1997, when Tex.R. Jud. Admin.ll was promulgated. Nor are class actions, consolidations, or other traditional means of grouping cases sought on a routine basis for silica cases. Still, most silica cases are resolved in two to three years or less with relatively very little use of the courts’ time and resources. Parties invariably agree to use of Master Discovery requests. This Master Discovery is, by and large, handled without court intervention. Depositions are taken on a regular schedule through the cooperation of opposing counsel, mostly without incident. In fact, there are very few trials, and most cases are resolved either through mediation or settlement discussions, often without the court having to order mediation.
Now, six Defendants (the Movants)— without consulting their fellow Defendants — seek to change entirely the handling of all silica pre-trial matters. The Motion does not meet Rule IB’s bare minimum requirements. Movants do not offer an adequate, thorough, or reasoned explanation of existing problems that the transfer would resolve, nor do they explain how exactly the transfer would help. Specifically, Movants make no showing of duplicative discovery, inconsistent rulings, or pretrial mismanagement that could be avoided or lessened by the transfer and consolidation they now pursue. Absent a much more compelling, complete, and reasoned explanation that demonstrates a need for change and explains how the change would help, this Panel must deny the revolutionary changes Movants seek. Movants have not offered sufficient justification to change from the known current, efficient way of handling cases, to an unknown and untested mechanism that may create new problems without offering better resolution to any old ones. In short, U.S. Silica Company and Unimin Corporation would urge the Panel to follow a well-known colloquial phrase: If it ain’t broke, don’t fix it.

This system is as close to a perfect litigant-driven system as can be found. The panel majority concedes this fact. The majority can point to no significant instances where inconsistent rulings have occurred or discovery abuse has taken place.

DISCUSSION

Rule 13 permits us to transfer these cases if we find that “related cases involve one or more common questions of fact, and that transfer to a specified district court will be for the convenience of the parties and witnesses and will promote the just and efficient conduct of the related cases.” Rule 13©. Not only have the movants failed to demonstrate any of these elements, the record indicates to me that transfer will have a detrimental effect on silica litigation and will unnecessarily alter the civil justice system for silica cases in Texas.

1. Inconvenience of parties and witnesses

Experienced trial attorneys will confirm that pretrial matters are most conveniently handled in the local community and court where the case is filed. The panel majority lists some ten categories of potential pretrial matters that might come before the MDL court including matters like discovery, venue and Robinson/Havner challenges. Many of these issues might require individual hearings in individual cases. It is difficult for me to imagine that a party or witness in El Paso, Texarkana, or Brownsville would find it “convenient” to travel to Houston for every pretrial hearing to be held in their case. More importantly, the movants have made no showing of inconvenience in this MDL proceeding. The majority concedes that mov-ants have not shown that a single party or witness has yet been inconvenienced. And yet, the majority grants the motion based in part on the assertion that “it is undeniable that it is more convenient for witnesses and parties who find themselves involved in several cases to be subject to one court instead of several.” While this is strong rhetoric, I question the soundness of the reasoning. Except for those parties and witnesses living in the city of the MDL court, the parties will have to travel across the state to attend every single pretrial hearing. I would submit that a party traveling halfway' across the state to attend a routine pretrial hearing would be little comforted by the “convenience” of arguing their motion before a Houston judge as opposed to one in their own local community.

As for the convenience of having only one set of orders, the silica-litigation parties up to this point have collegially conducted their litigation by using the standardized and uniform Texas Rules of Civil Procedure coupled with a body of formal and informal agreements. The movants have not brought forth a single instance in which they have been prejudiced by inconsistent rulings or the absence of uniform pretrial orders. But rather than place the burden of proof on the movants where it belongs, the majority speculates that the silica litigants will find it “convenient” to have only one set of pretrial orders. Of course, that presupposes that the MDL court will impose the same set of orders in every case — a supposition not supported by the record.

2. Unjust and inefficient handling of cases

One of the most oft-quoted phrases regarding efficiency and justice in the civil justice system is “justice delayed is justice denied.” Today, a panel majority orders the transfer of 71 cases to a single statewide pretrial judge. Soon, that number may swell to thousands; indeed, one of the parties to this MDL proceeding indicated that 25,000 silica cases were filed nationwide in the year 2003 alone. The majority seems to think that these cases "can be more efficiently handled by one judge as opposed to spreading the workload among the 422 district courts across the state. This viewpoint, in my opinion, defies common sense. To provide a rough analogy, the civil justice system is like a tollway with 422 district judges manning individual toll booths. To eliminate all the toll booths save one will, in my opinion, seriously impede the flow of litigation traffic. The majority’s view of efficiency is troubling, to say the least. I am equally troubled by the statement made by the majority: “Nor can we ignore what we as judges know from experience — that it is difficult for dedicated but busy trial judges to consistently give cases like these the deliberate, thoughtful, and focused pretrial treatment they deserve.” While I wholeheartedly agree that, with the legislative budget cuts and the virtual elimination of the visiting judge program, our active district courts are stretched to the breaking point, it is curious that a majority of this panel would transfer the entire silica-litigation docket, present and future, to an active sitting judge in Harris County who, I am sure, has little spare time on her hands. Further, I believe that the majority is unrealistic to assert that a statewide MDL judge will be able to give these 71 silica cases more attention than 55 district judges could give them in their local courtrooms.

By contrast, everything in this record, which the majority concedes, establishes that over the last 80 years, silica cases have been handled by agreement and have not required numerous and extensive pretrial hearings. Counsel for U.S. Silica, who has been handling its docket for over a decade, could count the number of hearings and trials on the fingers of two hands. And what justification are we given for abandoning such an incredibly efficient civil justice system? We are told that one group of six defendants has the right to have their complaints decided by a court rather than settled by agreement with plaintiffs’ and their fellow defense counsel. Fair enough. But why should six defendants be allowed, not only to destroy a longstanding collegial system of dispute resolution, but to force 605 other parties to forfeit their right to be heard by a judge in the community where the action arose? We are not told by the majority.

3. Lack of common questions of fact

While conceding that “each personal injury case is indeed different” the majority opinion describes issues of law, not fact, to justify transfer such as “discovery, venue and forum non conveniens, the ‘sophisticated user’ doctrine, Robinson and Hamer challenges to expert testimony, the sufficiency of warnings, and other issues concerning common worksites, product identification, and the validity of the diagnosis and screening process.” Although I am sure that' common questions of fact do exist within the 71 transfer cases, the majority cannot point to a single piece of evidence in this record to establish the common questions of fact. This record is completely devoid of any proof to that effect. On the other hand, although not their burden, the respondents have provided evidence that silica cases are highly individualized, and, although grouped at common worksites, even those individual cases will be widely divergent on issues like product identification and causation. Surely, the movants must do more than simply state that silicosis is a similar disease. of the lung and therefore all silica cases are similar. The MDL Statute and Rule 13 are clear. Common questions of fact are required to be proved.

CONCLUSION

Litigants should be required to handle their cases under the traditional civil justice system pursuant to the Texas Constitution and statutes. MDL consolidation is an extraordinary remedy that should only be considered where the burden of proof has been met. The record in silica cases demonstrates an incredibly efficient and convenient system in which collegial agreements complement the civil justice system. Today, a majority of this panel allows a small group of defendants to alter the civil justice system without holding them to their burden of proof. Because I believe that the overwhelming weight of the evidence provided by the respondents, madé up of defense and plaintiffs’ counsel alike, establishes that transfer to a single statewide MDL judge is inconvenient, unjust, inefficient, and unneeded, I respectfully dissent.

      . Tex.R. Jud. Admin. 13, reprinted in Tex. Gov’t Code Ann., tit. 2, subtit. F app. (West Supp.2004-05).

      . See Humble Sand & Gravel, Inc. v. Gomez, 47 Tex. S.Ct. J. 1214, 146 S.W.3d 170 (2004).

      . E.I. du Pont de Nemours & Co. v. Robinson, 923 S.W.2d 549 (Tex.1995); Merrell Dow Pharmaceuticals, Inc. v. Havner, 953 S.W.2d 706 (Tex.1997).

      . The model instructions to jurors found in rule 226a refer to the fact questions the jury will decide. Section I: "Your duty will be to decide the disputed facts.” Section II: "It is your duty to listen to and consider the evidence and to determine fact issues later submitted to you ...." Section III: “This case is submitted to you by asking questions about the facts, which you must decide from the evidence you have heard in this trial.” See Tex.R. Civ. P.226a (emphasis added). These are references to the broad-form questions of mixed law and fact that jurors are routinely asked, see Tex.R. Civ. P. 271-279, and there can be no doubt that Rule 13 uses the term "common issues of fact” in this sense to include common questions of mixed law and fact.

      . By our reckoning, a clear majority of the cases are being handled by lawyers from cities quite far removed from the county of venue. These include lawyers from Dallas handling cases in Brownsville, Austin, El Paso, Galveston, Brazoria, Beaumont, and Corpus Christi; lawyers from Houston handling cases in Tyler, Midland, Galveston, and Orange; lawyers from Port Arthur handling cases in Odessa, Corpus Christi, and Brownsville; and lawyers from Henderson handling cases in Victoria, Richmond, Port Lavaca, and Wharton. We do not say that these lawyers should prefer the easier or comparable trip to Houston; after all they have exercised their right to oppose the Rule 13 motion. We note only that the dissent is mistaken in arguing that traveling to hearings in Houston will be significantly more inconvenient for many of the lawyers in these cases.


text:
    In re VANDERBILT MORTGAGE AND FINANCE, INC.
    No. 05-0076.
    Texas Judicial Panel on Multidistrict Litigation.
    Feb. 23, 2005.
   THE MOTION FOR TRANSFER IN THE FOLLOWING MULTIDIS-TRICT LITIGATION CASE IS DENIED AS FOLLOWS:

PER CURIAM.

The Multidistrict Litigation Panel has denied the Motion to Transfer of Related Cases to Pretrial Court.


author: Justice LANG

text:
    In re VANDERBILT MORTGAGE AND FINANCE, INC.
    No. 05-0076.
    Texas Judicial Panel on Multidistrict Litigation.
    March 2, 2005.
   ON REVIEW BY THE JUDICIAL PANEL ON MULTIDISTRICT LITIGATION

Justice LANG

delivered the opinion of the Multidistrict Litigation Panel, in which

Justice PEEPLES, Justice CASTILLO, and Justice HANKS joined.

On February 23, 2005, we issued our order denying the Motion to Transfer of Related Cases to Pretrial Court filed by Vanderbilt Mortgage and Finance, Inc. This opinion sets out the basis for that decision.

I. Factual and Procedural Context

Vanderbilt filed its Motion before this panel on January 31, 2005. It alleges that six cases pending in North Texas involve common issues of fact and the transfer would be for the convenience of the parties and witnesses and would promote the just and efficient conduct of the cases. The Motion was accompanied by a Motion to Stay Proceedings. In a supplement to the Motion to Stay, Vanderbilt argued that a stay of all of the cases was urgently needed during our consideration of the Motion since one of the Tarrant County cases was set for trial on February 22, 2005; depositions were set in that case for February 3; and a Motion for Continuance/Stay was set for hearing before the trial court on February 4, 2005.

We are advised by Vanderbilt that it is a commercial lender. It lent money to fifteen different owners of manufactured homes and secured each loan with a lien against the borrower=s manufactured home. Vanderbilt tells us that, in each suit, it has challenged the lawfulness of the recovery and storing of these manufactured homes by Statewide Repo Housing, Inc. and/or its affiliate Eagle Lender Asset Services, Inc. This recovery and storing was performed at the request of Sheriffs and/or Constables who executed writs of possession following entry of judgments in eviction proceedings in favor of land owners. (Statewide and Eagle will be referred to as Statewide.)

Vanderbilt claims that there are common issues of fact which must be resolved: (1) Statewide has not obtained allegedly required state permits to transport the homes; (2) Statewide demands excessive fees of the lender/lien holder to recover the home after removal by Statewide; (3) Statewide allegedly charges “incredibly high storage fees” which are claimed to be “well over twice as high as industry standard”; (4) Statewide’s assertion of warehouseman’s liens is unlawful; and (5) Statewide, “on information and belief,” has fraudulently applied for and obtained new titles for some homes identifying Statewide as the owner to the damage of the lien holder and the true owner.

Finally, Vanderbilt tells us, in a general way, that transfer will greatly reduce the time and expense for discovery since uni-, form written discovery can be used and duplication of depositions can be avoided. It is suggested that “the same lay witnesses and expert witnesses will give essentially the same testimony in each of the related cases concerning the reasonableness of charges to move and store a manufactured home.” Also, Vanderbilt tells us, in a general way, that “other pretrial matters can be handled more efficiently through coordinated pretrial proceedings .... ”

Statewide filed an Objection To Motion To Transfer of Related Cases to Pretrial Court and Objection to Stay. It provided us with important, uncontradicted facts respecting the six cases. According to Statewide, all written discovery filed in five of the six cases has been completed. Only one deposition has been taken. The attorneys representing Vanderbilt, on the one hand, and Statewide, on the other hand, in each case are the same. The two Tarrant County cases are set for trial in the near future. The case in the 352nd District Court was set for trial on February 22, 2005, and the case in the 141st District Court was set for trial on March 14, 2005. Statewide advised that all discovery has or will be timely completed in those two cases. However, as to the issues Vanderbilt claimed to be common to the six suits, Statewide denied there were any real issues, yet asserted a different version of the facts. Finally, Statewide asserts that Vanderbilt filed this Motion merely to avoid the trial settings in February and March 2005. ■

Vanderbilt filed no reply to Statewide’s objections. We denied the stay.

II. Discussion and Application of Authorities

Rule 13 provides a pretrial process that will allow cases to proceed efficiently toward trial. “It does not require proof that witnesses have already been inconvenienced; it looks ahead and focuses on whether transferring cases to a pretrial judge would serve the convenience of parties and witnesses by preventing inconvenience in the future.” In re Silica Products Liability Litigation, 166 S.W.3d 3, 5, 2004 WL 3328646, No. 04-0606 (Tex. M.D.L. Panel Oct. 13, 2004).

While relevant, the number of pending cases and parties is not directly determinative of the necessity for pretrial transfer. However, of great significance in this case are the uncontroverted facts that in two of the six cases discovery is complete or will be complete shortly and there are imminent trial settings in those cases. Further, although “ongoing problems” in the pretrial process need not exist for us to order transfer, we must be shown some facts and well-founded reasons which logically suggest that transfer will create a more efficient process.

We have previously observed:

One virtue of transferring related cases to a single pretrial judge is that issues, once raised, will be decided the same way in the future. A consistent and steady judicial hand at the helm should in fact promote agreements because lawyers will know where the court stands on recurring issues. As contested issues arise, the pretrial judge will make consistent rulings, which can then be reviewed by the appellate courts as appropriate. This, we think, serves Rule 13’s goal that our system give related cases consistent and efficient treatment.

However, we cannot apply this reasoning to this case. We are advised by Statewide that written discovery has been propounded in all but one case and only one deposition has been taken. That does not suggest difficulties presently or in the future in pretrial matters. Additionally, although Vanderbilt has raised some contentions it describes as common issues of fact, we have not been advised of how a pretrial judge can address these contentions in order to promote uniformity of decisions. We will not speculate about a party’s strategy to address its so-called common issues of fact. Finally, we have not been told what fact or expert witnesses, if any, would be required to be deposed on multiple occasions without the order of transfer and intervention of a pretrial judge. Plainly stated, no reasonable likelihood of difficulties in the pretrial processing of these cases has been proffered.

III. Conclusion

We conclude that Vanderbilt has not met its burden under Rule 13. Additionally, we conclude that the transfer of these cases will not serve the convenience of the parties and the witnesses, nor will it promote the just and efficient conduct of the cases. Accordingly, we deny Vanderbilt’s Motion to Transfer.

      . (a) Vanderbilt Mortgage and Finance, Inc. v. Jim Carbitcher, et al., No. 04-11081 (134th Dist. Ct., Dallas County, Tex.) (b) Statewide Repo Housing, LLC v. Oakwood Acceptance Corporation, LLC, v. Kerry D. Howell, et al., No. CV04-2513 (415th Dist. Ct„ Parker County, Tex.); (c) Statewide Repo Housing, LLC v. Oakwood Acceptance Corporation, LLC v. Troy Steven Washburn, No. 05-01-003 (271st Dist. Ct., Wise County, Tex.); (d) Vanderbilt Mortgage and Finance, Inc. v. Sixto Terrazas, et al., No. 352 204253 04 (352nd Dist. Ct., Tarrant County, Tex.); (e) Vanderbilt Mortgage and Finance, Inc. v. Johnny Hogue, et al., No.2004-10043-16 (16th Dist. Ct., Denton County, Tex.); and (f) Vanderbilt Mortgage and Finance, Inc. v. Lee Modgling, et al., No. 141 204903 04 (141st Dist. Ct., Tarrant County, Tex.).

      . Tex.R. Jud. Admin. 13, reprinted in Tex. Gov’t Code Ann., tit. 2, subtit. F app. (Vernon 2005).

      . Rule 13.3(j) provides in part, "The MDL Panel will accept as true facts stated in a motion, response, or reply unless another party contradicts them.” Tex.R. Jud. Admin. 13.3(j), reprinted in Tex. Gov’t Code Ann. tit. 2, subtit. F app. (Vernon 2005).

      . cf. In re Silica Products Liability Litigation, 166 S.W.3d at 3, No. 04-0606 (It was uncon-troverted that 453 plaintiffs filed 71 silica-related lawsuits against a total of 158 defendants, pending in 55 district courts in 20 counties.).

      . In re Silica Products Liability Litigation, 166 S.W.3d at 6, No. 04-0606.


author: VANMETER, Judge.

text:
    Dianna MEADE, Appellant, v. RICHARDSON FUEL, INC., Appellee.
    No. 2004-CA-000531-MR.
    Court of Appeals of Kentucky.
    June 10, 2005.

      James Bates, Hindman, KY, for appellant.
    Clifford B. Lata, Prestonsburg, KY, for appellee.
    Before HENRY and VANMETER, Judges; MILLER, Senior Judge.

      . Senior Status John D. Miller Sitting as Special Judge by assignment of the Chief Justice pursuant to Section 110(5)(b) of the Kentucky Constitution and Kentucky Revised Statutes 21.580.

   OPINION

VANMETER, Judge.

Dianna Meade, as seller, entered an oral agreement for the sale of mining equipment and supplies. After her buyer defaulted, she brought a conversion action against the owner of the mine at which the equipment and supplies had been used and/or consumed. We must-decide whether the absence of a written agreement prevents Meade from maintaining a conversion action against the mine owner, who retained possession of some of the items under a contractual provision with the buyer. As we hold that it does, we affirm the judgment of the Floyd Circuit Court dismissing the action.

Meade’s claim is that she entered into an oral agreement with Carson Thacker for the sale of mining equipment and supplies. Under her version of the transaction, Meade provided Thacker with supplies, parts, and mining equipment with the understanding that title to the items would pass to Thacker only as he paid for them, and that any items which were not paid for would be returned to Meade. Thacker then used the items while mining premises leased from Richardson.

The agreement between Thacker and Richardson contained a clause which provided: .

Unless otherwise agreed to by the parties hereto (i) [Thacker], covenants and agrees to remove all personal property, excepting those items which belong to RICHARDSON via the provisions hereof or otherwise, from the Contracted Premises within thirty (30) calendar days from the termination of this Agreement and (ii) all [Thacker’s] personal property remaining on the Contracted Premises after thirty (30) calendar days from the termination of this Agreement shall forthwith become the property of RICHARDSON and the title, ownership, and the right of possession thereof shall become vested in RICHARDSON without the necessity of a Bill of Sale for the same.

When Thacker’s operation subsequently failed, he left the disputed items on the site and did not make a demand for them until some sixty days later. Meade, Thacker, and other allegedly interested parties made competing claims for the items. Richardson did not release the items, contending that “no one had established a valid claim of ownership.”

Meade’s and Thacker’s complaint in the Floyd Circuit Court against Richardson and other co-defendants alleged that “[t]he defendants] wrongfully and willfully deprived the Plaintiffs of their equipment and supplies by refusing to give them to the Plaintiffs on demand.” The trial court referred the matter to the Floyd Circuit Court Master Commissioner. Following a hearing, the master commissioner dismissed the other defendants and made recommended findings, conclusions, and a judgment dismissing the complaint. The circuit court adopted the master commissioner’s recommendations and denied Meade’s motion to set aside the judgment. This appeal followed.

Meade first contends that the trial court erred by applying the statute of frauds, KRS 355.2-201, to her claim. A thorough reading of the trial court’s conclusions of law, however, discloses that the trial court correctly concluded that the transaction between Meade and Thacker was actually a security agreement, whereby Meade attempted to claim a security interest in the goods and to enforce that interest against Richardson. Under KRS 355.9-203,

(1) A security interest attaches to collateral when it becomes enforceable against the debtor with respect to the collateral, unless an agreement expressly postpones the time of attachment.
(2) Except as otherwise provided in subsections (3) to (9) of this section, a security interest is enforceable against the debtor and third parties with respect to the collateral only if:
(a) Value has been given;
(b) The debtor has rights in the collateral or the power to transfer rights in the collateral to a secured party; and
(c) One (1) of the following conditions is met:
1.The debtor has authenticated a security agreement that provides a description of the collateral and, if the security interest covers timber to be cut, a description of the land concerned;
2. The collateral is not a certificated security and is in the possession of the secured party under KRS 355.9-313 pursuant to the debtor’s security agreement;
3. The collateral is a certificated security in registered form and the security certificate has been delivered to the secured party under KRS 355.8-301 pursuant to the debtor’s security agreement; or
4. The collateral is deposit accounts, electronic chattel paper, investment property, or letter-of-credit rights, and the secured party has control under KRS 355.9-104, 355.9-105, 355.9-106, or 355.9-107 pursuant to the debtor’s security agreement.

The requirement of authentication under KRS 355.9-203(2)(c)l is that the debtor must sign a security agreement. KRS 355.9-102(l)(g). Since the record is clear that Thacker did not authenticate a security agreement by his signature or otherwise, under the unambiguous terms of KRS 355.9-203(1) and (2), Meade’s claimed security interest never attached to the collateral, and it was not enforceable against Thacker, or any third party such as Richardson. In essence, Meade was an unsecured creditor of Thacker.

Meade, who admits that Thacker and she had no written contract, asserts that her claim against Richardson is one of conversion rather than breach of contract. Meade asserts that Thacker and she “were free to live by their agreement and would probably have done so had [Richardson] refrained from interfering and confiscating the property and converting it to their [sic] own use.” The Kentucky Supreme Court recently noted the elements necessary to establish the tort of conversion:

(1) the plaintiff had legal title to the converted property; (2) the plaintiff had possession of the property or the right to possess it at the time of the conversion; (3) the defendant exercised dominion over the property in a manner which denied the plaintiffs rights to use and enjoy the property and which was to the defendant’s own use and beneficial enjoyment; (4) the defendant intended to interfere with the plaintiffs possession; (5) the plaintiff made some demand for the property’s return which the defendant refused; (6) the defendant’s act was the legal cause of the plaintiffs loss of the property; and (7) the plaintiff suffered damage by the loss of the property.

With respect to these elements, at a minimum Meade did not retain legal title to the allegedly converted property, and she had neither possession of the property nor the right to possess it at the time of the alleged conversion.

Meade’s attempted reservation of title, pending payment, was at best the attempted reservation of a security interest. KRS 355.2-401(1) provides that “[a]ny retention or reservation by the seller of the title (property) in goods shipped or delivered to the buyer is limited in effect to a reservation of a security interest.” In the instant case, Meade was obliged to comply with the requirements of Article 9 in order to protect her interests. As previously noted, since she failed to do so, she has no rights to the collateral. Thacker, therefore, was free to enter a contractual provision permitting Richardson to retain the equipment and supplies if Thacker failed to remove them within thirty days of defaulting and abandoning the mine site.

Meade next contends that the trial court erred by characterizing Richardson as a good faith purchaser of the mining equipment. A good faith purchaser is “one who takes by purchase getting sufficient consideration to support a simple contract, and who is. honest in the transaction of the purchase.”

The evidence supported the court’s findings that Richardson gave value for at least a portion of the goods. Because Meade did nothing to protect her security interest in the equipment, she cloaked Thacker with the appearance of ownership. Although Meade claims that Richardson knew that the property did not belong to Thacker, she provides no reference to evidence on the record to support her statement. Absent any encumbrances on the equipment or evidence of bad faith, Richardson became a good faith purchaser when it gave value for the equipment. Thus, the trial court did not err by finding that Richardson was a good faith purchaser for value.

Meade finally contends that the circuit court erred or abused its discretion by adopting unsupported findings of fact and by overruling her objections to the master commissioner’s report. Under CR 52.01, “[fjindings of fact shall not be set aside unless clearly erroneous.... The findings of a commissioner, to the extent that the court adopts them, shall be considered as the findings of the court.”

The record indicates that Meade admits the mining equipment was sold “on time” and was delivered to Thacker. She further admits that no written contract memorialized the agreement, and that no se-. curity interests were effectively created in her favor. In light of such admissions, which support the commissioner’s findings, the court did not err by adopting the commissioner’s findings of fact as its own.

The Floyd Circuit Court’s judgment is affirmed.

ALL CONCUR.

      . See KRS 355.1-201(37) (" 'Security interest’ means an interest in personal property or fixtures which secures payment or performance of an obligation.”)

      . KRS 355.9-102(l)(g) allows for both written and electronic security agreements, and “authenticate” permits more than a signature as the means of accepting an agreement. See David J. Leibson, Richard H. Nowka, The Uniform Commercial Code of Kentucky § 9.03[a] (3d ed.2004). However, Meade makes no claim that any electronic authentication occurred.

      . Kentucky Ass'n of Counties All Lines Fund Trust v. McClendon, 157 S.W.3d 626, 632 n. 12 (Ky.2005) (quoting 90 CJ.S. Trover and Conversion § 4 (2004)).

      . KRS 355.9-101, et seq.

      . David J. Leibson, Richard H. Nowka, The Uniform Commercial Code of Kentucky § 2.08[1] (3d ed.2004).

      . While the trial court characterized Richardson as a “bona fide purchaser,” KRS 355.2-403(1) uses the term "good faith purchaser.” In fact, the term "bona fide” means good faith, and the terms are interchangeable. Bryan A. Garner, A Dictionary of Modem Legal Usage, p. 113 (2d ed.1995).

      . United Road Mach. Co. v. Jasper, 568 S.W.2d 242, 244 (Ky.App.1978).

      . KRS § 355.2-403(1).

      . CR 52.01