Dallas County, Texas v. Tim Sutton A/K/A Timothy Sutton A/K/A Timothy L. Sutton A/K/A Timothy Lee Sutton

• Court: Court of Appeals of Texas
• Decided: February 14, 2024
• Docket: 05-22-00932-CV
• Status: Published

Opinion

Affirmed and Opinion Filed February 14, 2024

S In The Court of Appeals Fifth District of Texas at Dallas No. 05-22-00932-CV

DALLAS COUNTY, TEXAS, Appellant V. TIM SUTTON A/K/A TIMOTHY SUTTON A/K/A TIMOTHY L. SUTTON A/K/A TIMOTHY LEE SUTTON, Appellee

On Appeal from the County Court at Law No. 2 Dallas County, Texas Trial Court Cause No. CC-20-05497-B

MEMORANDUM OPINION Before Justices Partida-Kipness, Pedersen, III, and Garcia Opinion by Justice Partida-Kipness In this appeal we are asked to consider the application of the statute of

limitations against Appellant Dallas County (the County) after it tried to recover

excess monies mistakenly paid to Appellee Tim Sutton following a constable’s

execution sale. The trial court granted Sutton’s traditional and no-evidence motions

for summary judgment which asserted the limitations defense, while denying the

County’s related summary judgment motions. On appeal, the County asserts the trial

court erred in: (1) granting Sutton’s no-evidence motion for summary judgment, (2)

denying the County’s no-evidence motion for summary judgment, (3) granting Sutton’s traditional motion for summary judgment, and (4) denying the County’s

traditional motion for summary judgment. We affirm.

BACKGROUND

The relevant facts are largely undisputed. In May 2016, Sutton secured a

judgment against Francisco Rodriguez for $9,200 plus interest and costs. Sutton

obtained a writ of execution and sent it to the Dallas County Constable’s office,

requesting they sell Rodriguez’s real property to satisfy the judgment. The sale took

place on October 4, 2016. The proceeds from the sale exceeded the amount due to

Sutton. Based on the prior judgment, interest, and costs, Sutton was entitled to

receive $10,027.64. However, in mid-October 2016 the County mistakenly sent

Sutton two checks totaling $20,062.87. Thus, Sutton received an excess of

$10,035.23. Sutton claims he recognized the mistake and attempted to return the

excess funds, but the County refused to accept them. Ultimately, Sutton deposited

or cashed the checks.

After realizing its mistake, the County attempted to contact Sutton via email

in January 2017. The County then sent Sutton a demand letter on January 30, 2017.

That article was addressed to “Timothy Sutton” but signed for by “Aaron Sutton” on

or about February 3, 2017. It was later marked “Not at Address, Return to Sender.”

Sutton claimed he never received the demand letter or the prior email.

Rodriguez learned of the wrongful payment and made a demand on the

County for the excess funds paid to Sutton. Rodriguez submitted a claim to the

–2– Dallas County Commissioners Court around June 23, 2017. The commissioners

court approved Rodriguez’s claim by order dated August 1, 2017, and the Dallas

County Treasurer issued a check payable to Rodriguez for $10,035.23 on or about

September 19, 2017. The County attempted to contact Rodriguez to advise him the

County would release the check once he executed a release, but Rodriguez

apparently did not respond. Rodriguez’s sister contacted the County and asked if she

could pick up the check, as Rodriguez was purportedly out of the country. However,

the County would not release the check until Rodriguez executed a release. The

County ultimately received a release from Rodriguez on October 21, 2020.1 The

County issued a new check (the prior check had expired) to Rodriguez on November

17, 2020.

The County then filed suit against Sutton on December 18, 2020, asserting

claims for money had and received and unjust enrichment. The County also

requested declaratory relief to determine the rights of the parties regarding the excess

funds. The County pleaded that the statute of limitations is inapplicable to its claims,

citing section 16.061(a) of the Civil Practice and Remedies Code. Sutton answered,

asserting a general denial and the affirmative defenses of limitations, estoppel, and

laches. Sutton asserted the County was not entitled to rely on the exemption to the

statute of limitations contained in section 16.601(a).

1 The record does not reflect Rodriguez’s whereabouts during the three-year period between the County’s issuance of the original check and the County’s receipt of Rodriguez’s release. Nor does the record reflect whether the County made any additional efforts to locate Rodriguez during this time. –3– The parties filed cross-motions for summary judgment. In his traditional

motion for summary judgment, Sutton again contended the statute of limitations

barred the County’s claims and the County could not rely on the exemption in section

16.061(a) of the Civil Practice and Remedies Code. In his no-evidence motion for

summary judgment, Sutton asserted the County could not produce evidence its

claims were not barred by limitations. In its traditional motion, the County asserted

it was entitled to summary judgment against Sutton on its claims for money had and

received. In its no-evidence motion, the County asserted Sutton could not produce

evidence of one or more elements of his defenses of laches and estoppel.

After a hearing, the trial court issued an order granting Sutton’s traditional

and no-evidence motions for summary judgment and denying the County’s related

motions. The County’s motions for new trial and to vacate the judgment were

overruled by operation of law. This appeal followed.

STANDARD OF REVIEW

We review the grant of summary judgment de novo. Masterson v. Diocese of

Nw. Tex., 422 S.W.3d 594, 607 (Tex. 2013). A no-evidence motion for summary

judgment places the burden on the non-movant to present summary judgment

evidence raising a genuine fact issue. Bradford Partners II, L.P. v. Fahning, 231

S.W.3d 513, 516–17 (Tex. App.—Dallas 2007, no pet.). We review a no-evidence

motion for summary judgment under the same legal sufficiency standard used to

review a directed verdict. Id. Thus, we must determine whether the non-movant

–4– produced more than a scintilla of probative evidence to raise a fact issue on the

material questions presented. Id.

In a traditional motion for summary judgment, the movant has the burden to

demonstrate that no genuine issue of material fact exists, and it is entitled to

judgment as a matter of law. Provident Life & Accident Ins. v. Knott, 128 S.W.3d

211, 215–16 (Tex. 2003). When reviewing a summary judgment, we take as true all

evidence favorable to the nonmovant, and we indulge every reasonable inference

and resolve any doubts in the nonmovant’s favor. Id.

When both sides move for summary judgment and the trial court grants one

motion and denies the other, we review the summary judgment evidence presented

by both sides and determine all questions presented. Mann Frankfort Stein & Lipp

Advisors, Inc. v. Fielding, 289 S.W.3d 844, 848 (Tex. 2009). In such a situation, we

render the judgment the trial court should have rendered. Id. When both traditional

and no-evidence motions for summary judgment are filed, the reviewing court must

uphold the summary judgment if it can be sustained under either method. Bradford

Partners II, 231 S.W.3d at 516–17.

ANALYSIS

The County raises four issues on appeal. We begin by addressing issues three

and four, which are related and dispositive of our decision.

–5– I. The County’s Claims Are Barred by Limitations

In issue three, the County asserts the trial court erred in granting Sutton’s

traditional motion for summary judgment based on the statute of limitations. In issue

four, the County argues the trial court erred in denying the County’s traditional

motion for summary judgment on its claim of money had and received.

A two-year limitations period governs both claims for money had and

received and unjust enrichment. Pollard v. Hanschen, 315 S.W.3d 636, 641 (Tex.

App.—Dallas 2010, no pet.) (money had and received); Elledge v. Friberg-Cooper

Water Supply Corp., 240 S.W.3d 869, 871 (Tex. 2007) (unjust enrichment); see also

TEX. CIV. PRAC. & REM. CODE § 16.003 (general two-year limitations period).2

Sutton contends the County’s claims are barred by limitations because its claims

accrued in October 2016, but the County did not file suit until December 2020.

The County asserts it is not subject to any limitations period for its claims

against Sutton, relying on section 16.061(a) of the Civil Practice and Remedies

Code. That provision states: “[A] right of action of this state or a political subdivision

of the state, including a county . . . is not barred by any of the following sections:

16.001-16.004 . . . .” TEX. CIV. PRAC. & REM. CODE § 16.061(a). Through section

16.061, the legislature has exempted counties and other entities, unlike ordinary

2 While some claims for money had and received have a three-year limitations period under section 3.118(g) of the Business and Commerce Code, the County pleaded its claims under the common law. See Ahmed v. Bank of Whittier, N.A., No. 05-21-00058-CV, 2022 WL 1401432, at *4 (Tex. App.—Dallas May 4, 2022, pet. denied) (mem. op.). The County asserts the two-year limitations period applies. Furthermore, even if the three-year limitations period applied, it would not change the disposition of this case. –6– litigants, from the limitations defense in certain cases. Harris Cnty. v. Carr, 11

S.W.3d 342, 344 (Tex. App.—Houston 1999, no pet.).

Sutton contends the County cannot rely on section 16.061(a) because the

County did not possess a “right of action” as contemplated by the statute. Sutton

asserts any claim for the excess money belonged to Rodriguez, the judgment debtor,

rather than the County. Then, when the County paid Rodriquez the excess funds to

which he was entitled, the County became subrogated to Rodriguez’s claims. Sutton

therefore contends because all of Rodriguez’s claims were barred by limitations, the

County’s claims were likewise barred. Sutton relies on cases addressing limitations

exemptions in the context of workers’ compensation and banking claims. E.g., Carr,

11 S.W.3d at 344.

In Carr, Harris County paid workers’ compensation benefits to its employee

who was injured in an automobile accident. Id. at 343. The county then sued the

other driver (Carr), alleging his negligence caused the employee’s injuries. Id. Carr

asserted a limitations defense, while the county claimed it was exempt from the two-

year limitations period pursuant to section 16.061(a). Id. at 344. Carr argued section

16.061(a) did not apply because the county’s claim was a subrogation claim. The

court of appeals agreed. Id.

The court recognized that under supreme court precedent, a workers’

compensation insurer who asserts a subrogation claim asserts a “claim that belongs

to the employee.” Id. (emphasis in original) (citing Franks v. Sematech, Inc., 936

–7– S.W.2d 959, 960 (Tex. 1997)). The cause of action against the third-party tortfeasor

belongs to the employee, whether the insurer sues in its own name or the employee’s

name. Id. Thus, the third-party tortfeasor may assert defenses he would have had in

a suit brought directly by the employee, such as a limitations defense. Id. Because

the subrogation claim brought by Harris County against Carr was a claim that

belonged to the employee, not the county, it was not covered by the limitations

exemption of section 16.061(a). Id. Accordingly, the claim was barred by the two-

year statute of limitations. Id.; see also McNutt v. Cox, 129 S.W.2d 626, 628 (Tex.

[Comm’n Op.] 1939) (running of limitations period was not suspended during time

that promissory note was in the custody of state banking commissioner: “[T]his

action was not brought for the use or benefit of the state, but was brought for the use

and benefit of the creditors of the insolvent bank, who were the real parties at

interest.”); Resolution Tr. Corp. v. Holmes, 846 F. Supp. 1310, 1315 (S.D. Tex.

1994) (statute of limitations continued to run during period savings and loan

association was under the supervision of the state; the claims did not belong to the

state, but the association).

The County relies on cases generally holding that unauthorized payments

made by a governmental unit may be recovered. E.g., City of Taylor v. Hodges, 186

S.W.2d 61, 63 (Tex. 1945) (city could recover from county voluntary payments

made by city that should have been made by county); Cameron Cnty. v. Fox, 2

S.W.2d 433, 436 (Tex. Comm’n App. 1928, judgm’t adopted) (county could

–8– maintain a suit to recover a voluntary payment on a claim by the tax collector for a

bond premium that was later determined to have been unlawfully paid); Nunn-

Warren Pub. Co. v. Hutchinson Cnty., 45 S.W.2d 651, 653 (Tex. Civ. App.—

Amarillo 1932, writ ref’d) (county could maintain a suit to recover voluntary

payment on a claim for amounts paid to newspaper for publishing citations, when

the underlying payment was not statutorily authorized).

The County also relies on cases holding a payor has the right to recover funds

it has paid by mistake. E.g., Bryan v. Citizens Nat. Bank in Abilene, 628 S.W.2d 761,

763 (Tex. 1982) (check mistakenly paid over a stop payment order); Nevarez v.

USAA Fed. Savs. Bank, 630 S.W.3d 416, 423 (Tex. App.—El Paso 2021, pet.

denied) (bank could recover mistakenly paid residential loan funds from attorney

acting as escrow agent, who refused to return the funds); Benson v. Travelers Ins.

Co., 464 S.W.2d 709 (Tex. Civ. App.—Dallas 1971, no writ) (insurer could recover

excess funds mistakenly paid to its insured); Hull v. Friedman, 383 S.W.2d 236, 239

(Tex. Civ. App.—Fort Worth 1964, writ ref’d n.r.e.) (oil producer could recover

excess royalties paid by mistake); Gulf Oil Corp. v. Lone Star Producing, 322 F.2d

28, 32-33 (5th Cir. 1963) (oil producer could recover mistaken excess payments for

deliveries).

Finally, the County cites cases supporting that one who pays funds mistakenly

may bring an action against the recipient, even if the funds did not belong to the

payor. E.g., Doss v. Homecomings Fin. Network, Inc., 210 S.W.3d 706, 710-11 (Tex.

–9– App.—Corpus Christi 2006, pet. denied) (lender entitled to summary judgment on

its claim for money had and received against husband who kept funds mistakenly

paid to him instead of being applied to ex-wife’s note); Lyman D. Robinson Family

Ltd. P’ship v. McWilliams & Thompson, PLLC, 143 S.W.3d 518, 520 (Tex. App.—

Dallas 2004, pet. denied) (escrow agent was entitled to summary judgment to

recover excess monies mistakenly paid to property sellers); Amoco Prod. Co. v.

Smith, 946 S.W.2d 162, 164 (Tex. App.—El Paso 1997, no writ) (oil company’s

mistaken overpayment of royalties sounded in a claim for money had and received);

Atlantic Ref. Co. v. Tidwell, 318 S.W.2d 905, 908 (Tex. Civ. App.—Houston 1958,

writ ref’d n.r.e.) (minor’s guardian could not retain royalty payments mistakenly

made by oil company).3

We do not dispute the general propositions of law in each of the County’s

cited cases. However, none of those cases addressed whether the governmental

entity could avail itself of a limitations exemption like that in section 16.061(a) of

the Civil Practice and Remedies Code. The parties have not cited, and we have not

located, any cases addressing the scenario before us involving the mistaken payment

of proceeds from an execution sale and the application of the statute of limitations.

3 The County also cites a Pennsylvania case holding that a suit concerning excess funds from an execution sale could be maintained in the name of the sheriff. Longenecker v. Ziegler, 1 Watts 252 (Pa. 1832). However, we do not find Longnecker persuasive on the issue of whether a governmental unit possesses a right of action exempt from the statute of limitations. –10– Nonetheless, we agree with the reasoning of Carr and related cases as applied

to the facts of this case. Here, the claim against Sutton for the excess proceeds

belonged to Rodriguez, not the County. When the County paid Rodriguez after

learning of its mistake, it became subrogated to Rodriguez’s rights against Sutton.

However, the County, as subrogee, was subject to any defenses Sutton could have

asserted against Rodriguez, including the limitations defense. See Carr, 11 S.W.3d

at 344; see also Guillot v. Hix, 838 S.W.2d 230, 232 (Tex. 1992) (“Because a

subrogation action is derivative, the defendant in such an action may ordinarily

assert any defense he would have had in a suit by the subrogor.”). The County did

not have a “right of action” as contemplated by section 16.061(a) and cannot rely on

the limitations exception therein. See Carr, 11 S.W.3d at 344; Holmes, 846 F. Supp.

at 1315.

Our decision is further supported by the statutes addressing the rights and

duties of the parties to an execution sale. See TEX. CIV. PRAC. & REM. CODE §

34.047(c) (excess funds from sheriff’s sale shall be “immediately” paid to the

defendant/debtor); see also Turner v. Gibson, 151 S.W. 793, 793 (Tex. 1912)

(“Clearly the surplus of the sale becomes the property of the judgment debtor, and

he is entitled to receive it at once.”). If an officer fails to deliver monies collected by

execution to the person entitled to those funds, the officer and their sureties become

liable. TEX. CIV. PRAC. & REM. CODE § 34.067. The county, at the discretion of the

commissioners court, may pay any judgment against that officer. Id. § 34.069. When

–11– the county pays such a judgment, it “has a right of subrogation” against the debtor.

Id. § 34.070 (emphasis ours).

Thus, the statutes support that the County had no independent right of action

as contemplated by section 16.061(a) but was instead a subrogee to Rodriguez’s

rights. Rodriguez made a claim against the County for the excess funds. While the

record does not reflect a judgment or pending suit against the County, the

commissioners court obviously understood the County’s potential liability to

Rodriguez. Accordingly, the commissioners court authorized a payment to

Rodriguez by an order dated August 1, 2017, giving rise to a right of subrogation

against Sutton. See id. However, the County did not file suit against Sutton until

December 18, 2020, more than three years after it became subrogee, and more than

four years after the mistaken payment was made and the claim accrued (on or about

October 13, 2016).4 As a subrogee, the County was subject to any defenses Sutton

could have asserted against Rodriguez, including a limitations defense. Carr, 11

S.W.3d at 344. The County acknowledges that if section 16.061(a) does not apply,

its claims are barred.

Because section 16.061(a) does not apply and the County filed suit more than

two years after the claims accrued, the County’s claims are barred by limitations.

4 Rodriguez was not actually paid until November 2020, allegedly due to the County’s difficulty in locating Rodriguez and securing a release and assignment of claims. Even if the County’s right of subrogation did not arise until November 2020, the County is still subject to the limitations defenses Sutton would have had against Rodriguez. The two-year limitations period had long since expired, where the cause of action accrued in October 2016 when the excess payment was made. –12– Accordingly, the trial court did not err in granting Sutton’s traditional motion for

summary judgment based on limitations and denying the County’s traditional motion

for summary judgment for its claims of money had and received. We overrule issues

three and four.

II. Remaining Issues

In issue one, the County asserts the trial court erred in granting Sutton’s no-

evidence motion for summary judgment where Sutton argued the County could not

produce evidence its claims were not barred by limitations. In issue two, the County

asserts the trial court erred in denying the County’s no-evidence motion for summary

judgment on Sutton’s affirmative defenses of laches and estoppel. Our resolution of

issues three and four moots consideration of these remaining issues. See TEX. R. APP.

P. 47.1.

CONCLUSION

The County cannot claim the exemption to the running of the statute of

limitations in section 16.061(a) of the Civil Practice and Remedies Code. The

County’s claims for money had and received and unjust enrichment are barred by

the two-year statute of limitations. Therefore, the trial court did not err in granting

Sutton’s traditional motion for summary judgment based on limitations, or in

denying the County’s traditional motion for summary judgment.

–13– Accordingly, we affirm the trial court’s judgment.

/Robbie Partida-Kipness/ ROBBIE PARTIDA-KIPNESS JUSTICE 220932F.P05

–14– S Court of Appeals Fifth District of Texas at Dallas JUDGMENT

DALLAS COUNTY, TEXAS, On Appeal from the County Court at Appellant Law No. 2, Dallas County, Texas Trial Court Cause No. CC-20-05497- No. 05-22-00932-CV V. B. Opinion delivered by Justice Partida- TIM SUTTON A/K/A TIMOTHY Kipness. Justices Pedersen, III and SUTTON A/K/A TIMOTHY L. Garcia participating. SUTTON A/K/A TIMOTHY LEE SUTTON, Appellee

In accordance with this Court’s opinion of this date, the judgment of the trial court is AFFIRMED.

It is ORDERED that appellee TIM SUTTON A/K/A TIMOTHY SUTTON A/K/A TIMOTHY L. SUTTON A/K/A TIMOTHY LEE SUTTON recover his costs of this appeal from appellant DALLAS COUNTY, TEXAS.

Judgment entered this 14th day of February, 2024.

–15–