2200 West Alabama, Inc. v. Doc's Delight. L.L.C. D/B/A Ziggy's Healthy Grill

• Court: Court of Appeals of Texas
• Decided: June 16, 2011
• Docket: 01-10-00364-CV
• Status: Published

Opinion

Opinion issued June 16, 2011

In The

Court of Appeals

For The

First District of Texas

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NO. 01-10-00364-CV

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2200 West Alabama, Inc., Appellant

V.

Doc’s Delight, L.L.C. d/b/a Ziggy’s Healthy Grill, Appellee

On Appeal from the County Civil Court at Law No. 3

Harris County, Texas

Trial Court Case No. 902,968

MEMORANDUM OPINION

          2200 West Alabama, Inc. appeals the trial court’s order releasing a deposit, which was made in lieu of filing a supersedeas bond, to Doc’s Delight, L.L.C. d/b/a Ziggy’s Healthy Grill.  In an earlier phase of this lawsuit, the trial court rendered judgment awarding possession of the leased premises to the landlord, 2200 West Alabama.  Doc’s, the tenant, retained possession during the pendency of the appeal as a result of posting a deposit equal to the amount of six month’s rent.  Doc’s did not pay any rent during the more than six-month-long appeal.  In its sole issue, 2200 West Alabama, the landlord, contends that the trial court erred by releasing the deposit to Doc’s and denying 2200 West Alabama any recovery from the deposit.  We conclude that the trial court erred by denying 2200 West Alabama any rights in the deposit and returning the deposit to Doc’s.  We reverse and render.

Background

          The basic facts are not disputed.  2200 West Alabama leased premises to Doc’s for the operation of a restaurant.  In addition to monthly rent, the lease provided for common area maintenance fees.  Doc’s filed a declaratory judgment action seeking to determine whether it owed common area maintenance fees and, if so, in what amount.  2200 West Alabama answered and filed a counterclaim alleging a breach of the lease, seeking past due maintenance fees and attorney’s fees, and requesting possession of the property. 

          After a trial on the merits, the trial court rendered judgment on March 3, 2009 that Doc’s take nothing on its suit and that 2200 West Alabama receive damages of $6,781.03 in common area maintenance fees and $6,000 in attorney’s fees.  The final judgment also states, “IT IS FURTHER ORDERED, ADJUDGED AND DECREED that Defendant 2200 West Alabama, Inc. be, and the same is hereby, GRANTED possession of the premises described [in the lease].”  The award of damages and attorney’s fees is separate from the award of possession, and neither award is in any way conditioned upon the other.  After Doc’s motion for new trial was overruled by the trial court, 2200 West Alabama sought and received a writ of possession.   Doc’s then appealed the judgment by filing a notice of appeal on June 5, 2009.

          After appealing the judgment, Doc’s tendered a check covering the damages and attorney’s fees to 2200 West Alabama, which 2200 West Alabama cashed several months later.  The trial court held a hearing in June 2009 to determine the amount needed to supersede the remainder of the judgment (i.e., the possession of the premises) pending Doc’s appeal.  2200 West Alabama argued that because the judgment concerned an interest in real property, the amount required for supersedeas bond was “the value of the property interest’s rent or revenue.”  See Tex R. App. P. 24.2(a)(2)(A).  The trial court apparently agreed, noting in the case file that the amount required to supersede the judgment should be six times the monthly rent under the agreement, for a total of $52,800.  The trial court did not, however, sign an order fixing the supersedeas in that amount and Doc’s did not supersede the judgment.  Doc’s quit paying rent on the property after the hearing.

          Several months later, 2200 West Alabama applied for another writ of possession.  Doc’s responded by seeking and acquiring an ex parte order from the trial court setting the amount of supersedeas at $52,800.  On October 13, 2009, Doc’s deposited this amount with the court in lieu of posting a bond, superseding the judgment and staying 2200 West Alabama’s ability to take possession of the property during the appeal. 

          Approximately two months later, and a little over six months after Doc’s initiated the appeal by filing a notice of appeal, this court dismissed Doc’s appeal for want of prosecution.  Doc’s Delight, L.L.C. v. 2200 West Alabama, Inc., No. 01-09-00538-CV, 2009 WL 4854138, at *1 (Tex. App.—Houston [1st Dist.]  Dec. 17, 2009, no pet.).  Doc’s had failed to file a docketing statement or brief.  See id.  Accordingly, the trial court’s judgment remained in place.  After this court’s mandate issued, Doc’s finally vacated the premises by mid-January or early February.

          2200 West Alabama sought an order from the trial court releasing the full amount of Doc’s deposit in lieu of supersedeas bond to cover the period of over six months during the pendency of the appeal and during which Doc’s had not paid rent.  The trial court initially granted the request.  After Doc’s moved for reconsideration and filed its own motion to withdraw the funds on deposit with the clerk, the trial court reversed itself and issued an order releasing the full amount to Doc’s.  This is the order appealed from in this case.

Entitlement to the Deposit in Lieu of Bond

          A judgment debtor may suspend or supersede execution of a judgment while the debtor pursues appellate review by filing with the trial court clerk a good and sufficient bond or, as in this case, making a deposit with the clerk in lieu of a bond.  Tex. R. App. P. 24.1(a)(2)–(3); Whitmire v. Greenridge Place Apartments, 333 S.W.3d 255, 260 (Tex. App.—Houston [1st Dist.] 2010, pet. dism’d).  When the judgment involves an interest in real property, the amount of the supersedeas bond or deposit must be “the value of the property interest’s rent or revenue” during the pendency of the appeal.  Tex. R. App. P. 24.2(a)(2)(A); Whitmire, 333 S.W.3d at 260.  Furthermore, the surety on a bond or the deposit made in lieu of a bond is subject to liability “for all damages and costs that may be awarded against the debtor—up to the amount of the bond, deposit, or security,” if “the judgment is for the recovery of an interest in real or personal property, and the debtor does not pay the creditor the value of the property interest’s rent or revenue during the pendency of the appeal.”  Tex. R. App. P. 24.1(d)(3); see also Whitmire, 333 S.W.3d at 260.     

          The trial court awarded possession of the premises to 2200 West Alabama.  The trial court ordered supersedeas in the amount of $52,800—the value of six months’ worth of rent.[1]  Doc’s made a cash deposit in lieu of a bond in that amount, thereby suspending enforcement of 2200 West Alabama’s right to possession pending appeal.  This court dismissed the appeal for want of prosecution, resulting in a final judgment for possession for 2200 West Alabama.  Doc’s did not pay rent on the subject property for over six months during the pendency of the appeal.  The condition of liability for the deposit was that Doc’s, the debtor, did not pay 2200 West Alabama, the creditor, “the value of the property interest’s rent or revenue during the pendency of the appeal.”  See Tex. R. App. P. 24.1(d)(3); Whitmire, 333 S.W.3d at 260.  Because the conditions for liability have been met, 2200 West Alabama was entitled to the value of the unpaid rent during the pendency of the appeal, up to the amount of the deposit.[2]  See Tex. R. App. P. 24.1(d)(3).  Therefore, we hold that the trial court erred by denying the deposit in lieu of bond to 2200 West Alabama and returning it to Doc’s.

          In its appellee’s brief, Doc’s raises two arguments that it asserts defeat 2200 West Alabama’s entitlement to the deposit.  First, Doc’s asserts that the trial court   lacked jurisdiction to award possession to 2200 West Alabama.  Specifically, Doc’s asserts that the justice court for the precinct in which the premises are located has exclusive jurisdiction to hear a forcible detainer suit.  See Young v. Texas First Bank, No. 01-08-00835-CV, 2010 WL 1492296, at *3 (Tex. App.—Houston [1st Dist.] Apr. 15, 2010, pet. denied) (citing It’s the Berrys, L.L.C. v. Edom Corner, L.L.C., 271 S.W.3d 765, 770 (Tex. App.—Amarillo 2008, no pet.)).  Whether the trial court had subject-matter jurisdiction over the case is a question of law that we review de novo.  Id. at *2 (citing Mayhew v. Town of Sunnyvale, 964 S.W.2d 922, 928 (Tex. 1998)).

          While Doc’s is correct that the justice court has exclusive jurisdiction to hear a forcible detainer suit, it does not have exclusive jurisdiction to determine possession of real property.  Id. at *4 (citing Breceda v. Whi, 224 S.W3d 237, 240 (Tex. App.—El Paso 2005, no pet.)).   District courts and county courts at law have jurisdiction to award possession of real property; they only lack jurisdiction over forcible detainer suits applying the statutes and rules applicable to those suits.  Id. at 3–4 (citing It’s the Berrys, 271 S.W.3d at 770); see also Breceda, 224 S.W.3d at 240.  In this case, 2200 West Alabama did not invoke the forcible detainer statutes or Rules of Civil Procedure.  Rather, it answered and counterclaimed in the court chosen by Doc’s to adjudicate the rights of the parties under the lease.  Because the trial court did not lack jurisdiction to grant possession to 2200 West Alabama that portion of the judgment is not void.

          Second, Doc’s argues that 2200 West Alabama was faced with an election of remedies and, having chosen an inconsistent remedy, may not now seek possession of the premises.  “An election of remedies does not occur unless a party having two or more inconsistent remedies pursues one of them to the exclusion of the others.”  Fina Supply, Inc. v. Abilene Nat’l Bank, 726 S.W.2d 537, 541 (Tex. 1987).  “The doctrine is designed to prevent a party who has obtained a specific form of remedy from obtaining a different and inconsistent remedy for the same wrong.”  Id.  Doc’s contends that when it paid the money judgment for past-due common area maintenance fees and attorney’s fees, and 2200 West Alabama accepted that payment, 2200 West Alabama had no right to seek possession of the premises.

          Doc’s argument is premised on its contention that the trial court erred by awarding possession to 2200 West Alabama in its judgment.  Doc’s contends that the trial court erred in awarding possession because the assessment of past due common area maintenance fees did not affect the ongoing lease.  Even assuming that Doc’s is correct and that the trial court erred, it still cannot prevail.  The trial court’s judgment, even if erroneous, became final after Doc’s failed to prosecute its appeal.  Because the trial court’s judgment unconditionally awarded possession to 2200 West Alabama, when that judgment became final, 2200 West Alabama was entitled to both past due common area maintenance fees and possession of the premises.  Thus, there is nothing inconsistent in 2200 West Alabama both accepting the payment of the money portion of the judgment and seeking possession of the premises.

          We sustain 2200 West Alabama’s sole issue.

Conclusion

          We reverse the order of the trial court and render judgment awarding the full amount of the deposit in lieu of a bond to 2200 West Alabama. 

                                                                   Harvey Brown

                                                                   Justice

Panel consists of Chief Justice Radack and Justices Sharp and Brown.

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[1]           The monthly rent was $8,800.

[2]           Because rent was unpaid for over six months while the appeal was pending but the deposit was only in the amount of six months’ rent, 2200 West Alabama is entitled to the entire amount.  We therefore do not address the parties’ arguments concerning whether 2200 West Alabama is entitled to appellate attorney’s fees from the amount of the deposit in lieu of a bond.