Ann Keough v. Cyrus USA Inc. D/B/A Ace Limousine Services and Hamid Reza Mirabi

• Court: Court of Appeals of Texas
• Decided: July 13, 2006
• Docket: 14-04-00660-CV
• Status: Published

Opinion

Motion for Rehearing Granted; Majority and Dissenting Opinions of December 15, 2005 Withdrawn; Affirmed; and Majority and Dissenting Opinions filed July 13, 2006

Motion for Rehearing Granted; Majority and Dissenting Opinions of December 15, 2005 Withdrawn; Affirmed; and Majority and Dissenting Opinions filed July 13, 2006.

In The

Fourteenth Court of Appeals

_______________

NO. 14-04-00660-CV

ANN KEOUGH, Appellant

V.

CYRUS USA INC. d/b/a ACE LIMOUSINE SERVICES

and HAMID REZA MIRABI, Appellees

On Appeal from County Civil Court at Law No. 4

Harris County, Texas

Trial Court Cause No. 705,133

D I S S E N T I N G   O P I N I O N   O N   R E H E A R I N G

A trial court=s authority to dismiss for want of prosecution arises from: (1) Texas Rule of Civil Procedure 165a; and (2) the court=s inherent power.  Alexander v. Lynda=s Boutique, 134 S.W.3d 845, 850 (Tex. 2004).  As relevant to this case, a trial court may dismiss under rule 165a on the failure of a party seeking affirmative relief to appear at trial for which the party had notice.  Tex. R. Civ. P. 165a(1); Villarreal v. San Antonio Truck & Equip., 994 S.W.2d 628, 630 (Tex. 1999).  Additionally, a trial court has inherent power under the common law, independent of the rules of procedure, to dismiss where the plaintiff fails to prosecute his or her case with due diligence.  Villarreal, 994 S.W.2d at 630.

Importantly, however, a court may not dismiss a case for want of prosecution under either Rule 165a or its inherent authority without first providing a party notice and an opportunity to be heard.  Id.  AThe failure to provide adequate notice of the trial court=s intent to dismiss for want of prosecution requires reversal.@  Id.

Where a verified motion to reinstate is timely filed, an oral hearing is required under rule 165a, even if the grounds in the motion do not mandate reinstatement, and a failure to hold such a hearing requires reversal.  Thordson v. City of Houston, 815 S.W.2d 550, 550 (Tex. 1991).  The dismissal and reinstatement procedure set forth in rule 165a is cumulative of the rules and laws governing any other procedures available to the parties in such cases and is applicable to all dismissals for want of prosecution, including those under the court=s inherent power, whether or not a motion to dismiss has been filed.  Tex. R. Civ. P. 165a(4).

In this case, the trial court signed a dismissal order six days after Keough failed to appear for trial without providing any notice, before or after the trial date, of its intent to do so.^[1]  It also denied Keough=s timely filed, verified motion to reinstate without holding a hearing on it.^[2]  However, Keough did not object in the trial court, or assign error on appeal, to this lack of notice and lack of hearing.  Instead her challenge has been based solely on the contention that her failure to appear was not intentional or the result of conscious indifference within the meaning of Rule 165a(3).

A failure to appear is not intentional or due to conscious indifference for this purpose merely because it is negligent or even deliberate; it must also be without adequate justification.  Smith v. Babcock & Wilcox Constr. Co., 913 S.W.2d 467, 468 (Tex. 1995).  Proof of such justification, i.e., accident, mistake, or other reasonable explanation, negates the intent or conscious indifference for which reinstatement can be denied.  Id.

Keough=s verified motion for reinstatement asserted that her failure to appear was Aunavoidable@ because her counsel of record was unable to practice law due to a pending disciplinary proceeding.  However, attached to appellees= response to the motion to reinstate was an exhibit showing that Keough=s counsel had been disbarred roughly six weeks before the trial date which had been set over two months before the date of disbarment.  Therefore, it was not apparent at the time of the denial of reinstatement (or subsequently) that Keough=s failure to appear was unavoidable due to her attorney=s previous disbarment; that is, why it prevented her from hiring new counsel or at least appearing in court to request a continuance.  In addition, although Keough contends on appeal that she did not know of the disbarment or the trial setting, the record contains no evidence to support these allegations.

Importantly, however, the justification necessary to require reinstatement does not require a reasonable justification for making the mistake, but only a justification consisting of a mistake, as contrasted from conscious indifference.^[3]  Therefore, even if Keough=s failure to appear in this case due to her attorney=s disbarment amounted to a complete lack of diligence, it did not rise to the level of conscious indifference, and the trial court had no discretion to deny her motion to reinstate for failure to show that her failure was not intentional or the result of conscious indifference.^[4]

The majority opinion concludes that the trial court properly dismissed, and denied reinstatement, based on a failure to diligently prosecute because Keough failed to address this in her motion to reinstate and on appeal as an alternative ground for dismissal.  However, on the date the case was called for trial, the trial court had no discretion to even consider, let alone rule upon, a dismissal for failure to diligently prosecute because no notice had been given of any intent to do so.  Similarly, the dismissal order^[5] clearly reflects that appellees= motion to dismiss and the court=s granting of the motion was triggered by Keough=s failure to appear.  The one-sentence finding in the order that this was the seventh trial setting is mentioned in passing as a consideration supporting the dismissal based on the failure to appear, but the order contains no mention or finding of a failure to diligently prosecute, or a recitation of any other facts that would support such a finding.  Because a failure to diligently prosecute is not referred to in the order at all, let alone presented as a basis that would have independently supported the dismissal, i.e., even if Keough had not failed to appear, it was not an alternative ground for the dismissal.  Therefore, because Keough had no notice that the case was dismissed for failure to diligently prosecute, much less on what facts any such decision could have been based, she had neither an obligation nor an ability to challenge any such ground.

For these reasons, I would reverse the judgment of the trial court.

/s/        Richard H. Edelman

Justice

Judgment rendered and Majority and Dissenting Opinions on Rehearing filed July 13, 2006.

Panel consists of Justices Edelman, Seymore, and Guzman.  (Guzman, J., Majority).

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^[1]           The trial date had been set in an order granting a motion for continuance, but neither this order, nor any of the orders setting the preceding trial dates had contained any indication that the case was subject to dismissal on those dates for failure to appear or to diligently prosecute.  The record contains no other document providing such notice for this trial date, and appellees do not contend that any such notice was given or that the court even had any intent to dismiss until appellees moved to dismiss after Keough failed to appear.  In addition, the dismissal order recites that Keough had notice of the trial setting but says nothing of any notice of an intent to dismiss:

BE IT REMEMBERED that on Tuesday, February 3, 2004, the clerk called this case for trial.  DEFENDANTS appeared in person and through their attorney of record, and announced ready for trial, however, PLAINTIFF and her attorney failed to appear.  Whereupon, Defendants moved this Court to dismiss this action for want of prosecution.  The Court finds that this current trial date was the seventh trial setting of this matter, with the first trial setting of this matter set for May 6, 2002.  The Court further finds that proper notice was sent to counsel of record advising them of this current trial setting.  Accordingly, the Court finds Defendants= Motion to Dismiss meritorious and should in all things be granted.

Because there is no authority that providing notice of intent to dismiss can either be presumed or inferred from a lack of affirmative evidence to the contrary, but instead only authority that such notice is closely scrutinized even when it is given, the record in this case supports only a conclusion that no notice of intent to dismiss was provided by the trial court.

^[2]           The lack of a hearing is indicated by the language of the order denying the motion to reinstate, Aon this day came on to be considered . . . .@ rather than referring to a hearing; and the assertion in appellees= brief that Keough did not request a hearing and none was required.

^[3]           See Smith, 913 S.W.2d at 468.  By contrast, a motion for continuance requires a showing of sufficient cause supported by affidavit, consent of the parties, or operation of law.  Tex. R. Civ. P. 251.  Even the absence of counsel is generally not good cause for this purpose.  Tex. R. Civ. P. 253.  This discrepancy between the standards for granting a continuance and reinstatement creates an apparent anomaly in which a party who is not diligent enough to appear for trial can effect a continuance (through dismissal and reinstatement), whereas a party who is diligent enough to appear, but lacks sufficient cause for a continuance, cannot.

^[4]           The majority opinion concludes that the trial court could deny Keough=s motion to reinstate based on failure to appear because she produced no Aproof@ to support her allegations that she was unaware her attorney had been disbarred or trial had been set or that she was unable to secure other counsel.  However, her motion did not rely on those allegations, but only on the fact that her attorney was unable to appear and represent her due to his disbarment:

This case was dismissed . . . due to the inability of the counsel of record to appear before this court and prosecute this action.

This failure was not intentional or the result of conscious indifference but unavoidable, in that counsel of record, Zerrie L. Hines, was and remains under disciplinary proceeding before the Board of Disciplinary Appeals, and therefore, unable to engage in the practice of law pending the favorable outcome of his appeal.

Although the Averification@ in Keough=s motion states that her (successor) attorney Acertifies@ that the facts in the motion are true and correct, rather than that the facts were sworn to or otherwise given under oath, appellees= response to the motion did not object to this variance, but, more importantly, affirmatively stated and attached proof that Keough=s counsel had indeed been disbarred.  Therefore, the facts on which her motion was actually based were effectively stipulated, and, thus, the motion was not within the trial court=s discretion to deny for lack of proof.

^[5]           See supra, note 1.