in the Matter of the Marriage of Grace Wu and Simon Mong Hsiang and in the Interest of K.H., a Child

• Court: Court of Appeals of Texas
• Decided: June 30, 2014
• Docket: 07-13-00327-CV
• Status: Published

Opinion

In The Court of Appeals Seventh District of Texas at Amarillo

No. 07-13-00327-CV

IN THE MATTER OF THE MARRIAGE OF GRACE WU AND SIMON MONG HSIANG AND IN THE INTEREST OF K.H., A CHILD

On Appeal from the 364th District Court Lubbock County, Texas Trial Court No. 2011-559,731, Honorable Bradley S. Underwood, Presiding

June 30, 2014

MEMORANDUM OPINION Before QUINN, C.J., and CAMPBELL and HANCOCK, JJ.

This appeal arises from a default judgment in a divorce suit entered against

appellant Grace Wu. Wu appeals from the trial court’s order denying her motion for new

trial, arguing (1) that proper notice of the final hearing date was not given; and (2) the

elements for a new trial after a post-answer default were established. We will affirm the

judgment of the trial court. Background

In 2011, Wu petitioned for divorce from appellee Simon Mong Hsiang. Wu and

Hsiang have one minor child, born in 1996. At the time of the final hearing, the child,

although still a minor, was attending college. Their other child was an adult at the time

of the final hearing.

The final hearing was originally scheduled for a day in April 2013. Both parties

appeared at that time and agreed to postpone the final hearing until certain records and

documents had been exchanged. After leaving the courtroom, both counsel “spoke with

the court coordinator to reschedule the hearing. The court coordinator stated that May

29, 2013 was available for the hearing and that she would hold that date.” No written

notice confirming the May 2013 date appears in the record.

The parties engaged in correspondence regarding the exchange of the requested

documents. The documents from Hsiang were sent by his attorney to Wu’s attorney on

May 28, 2013. The attorneys did not discuss the final hearing that was to take place the

following day. Hsiang appeared with counsel and testified at the hearing. Wu did not

appear.1 At the conclusion of the hearing, the trial court granted the divorce. The court

signed the final decree in July 2013.

1 At the outset of the final hearing, after noting Wu’s failure to appear, the trial court stated, “The record will reflect that my understanding is that the attorneys had this set, and the attorneys got with the court coordinator and set today's date at 1:15 for a final hearing.” The reporter’s record of the final hearing shows the court coordinator attempted to contact Wu’s counsel by telephone but was unsuccessful. The hearing began at 2:02.

2 Wu timely filed a motion for new trial, which the trial court denied after a hearing.

This appeal followed.

Analysis2

Notice of Final Hearing

Wu initially argues she did not receive proper notice of the May 29, 2013 hearing.

A party who appears in the case is entitled to notice of a trial setting as a matter of due

process. LBL Oil Co. v. Int'l Power Servs., Inc., 777 S.W.2d 390, 391 (Tex. 1989) (per

curiam); Bradford v. Bradford, 971 S.W.2d 595, 597 (Tex. App.—Dallas 1998, no pet.).

Civil rule 245 provides in part that “when a case previously has been set for trial,

the Court may reset said contested case to a later date on any reasonable notice to the

parties or by agreement of the parties.” Tex. R. Civ. P. 245.

It is generally presumed that a trial court hears a case only after notice has been

given to the parties, so the obligation to affirmatively show the lack of notice or non-

compliance with rule 245 lies with the complainant. Campsey v. Campsey, 111 S.W.3d

767, 771 (Tex. App.—Fort Worth 2003, no pet.). A written order is not required when

the record establishes that counsel for each party had adequate notice of the date set

for trial. Guerra v. Alexander, No. 04-09-0004-CV, 2010 Tex. App. LEXIS 4115, at *13

(Tex. App.—San Antonio May 26, 2010, pet. ref’d) (mem. op.) (citing Tewell v. Tewell,

599 S.W.2d 351, 354 (Tex. Civ. App.—Corpus Christi 1980, writ ref'd)). Rule 245 does

2 Hsiang asserts Wu waived her appellate issue because she failed to reference the appellate record in making her argument. While we agree Wu has failed to present proper citations to the record, see Tacon Mechanical Contractors v. Gant Sheet Metal, 889 S.W.2d 666, 671 (Tex. App.—Houston [14th Dist.] 1994, writ denied), we will nevertheless address Wu’s contentions.

3 not specify how much notice must be given with regard to reset dates in order for the

notice to be reasonable. Guerra, 2010 Tex. App. LEXIS 4115 at *13.

It is undisputed that counsel for both parties, after their agreement to reset the

final hearing, went to the court coordinator together, and that the coordinator gave them

a hearing date and time for the final hearing. Wu’s motion for new trial asserted her

counsel’s position that he understood the date was tentative, related to the uncompleted

discovery. Hsiang opposed the new trial motion, asserting the hearing date was not

tentative but was the agreed-upon date and time for the hearing. At the new trial

hearing, the court heard from both counsel. Given counsel’s conflicting versions of their

agreement, we will not second-guess the trial court’s implicit finding that Wu failed to

demonstrate a lack of notice of the final hearing or non-compliance with rule 245.

Accordingly, we cannot agree she has shown a violation of her due process rights.

Craddock v. Sunshine

Wu next contends she was entitled to a new trial because she satisfied the

elements necessary for such entitlement. We review the trial court's denial of a motion

for new trial for an abuse of discretion. In re R.R., 209 S.W.3d 112, 114 (Tex. 2006);

Ricks v. Ricks, 169 S.W.3d 523, 526 (Tex. App.—Dallas 2005, no pet.). A court abuses

its discretion if it acts arbitrarily, unreasonably, or without reference to guiding rules and

principles. Id.; Loehr v. Loehr, No. 13-08-00380-CV, 2009 Tex. App. LEXIS 6863, at *6

(Tex. App.—Corpus Christi Aug. 28, 2009, no pet.) (mem. op.). A trial court does not

abuse its discretion if there is some evidence of a substantive and probative character

4 to support its decision. Garza v. Garza, 217 S.W.3d 538, 549 (Tex. App.—San Antonio

2006, no pet.).

Craddock, 133 S.W.2d at 126, has been applied to divorce proceedings.3 See

Prince v. Prince, 912 S.W.2d 367, 369-70 (Tex. App.—Houston [14th Dist.] 1995, no

writ); Burgess v. Burgess, 834 S.W.2d 538, 539 (Tex. App.—Houston [1st Dist.] 1992,

no writ); cf. Little v. Little, 705 S.W.2d 153, 153-54 (Tex. App.—Dallas 1985, writ dism'd)

(stating that although the Craddock test is applicable to motions for new trial after a

default judgment in a divorce action, it may be superceded by the best interest of the

child test).

The test set out in Craddock contains three prongs, each of which a defaulting

party must satisfy. The new trial movant must: (1) present facts showing that the failure

to appear was not intentional or the result of conscious indifference but was due to

accident or mistake; (2) set up a meritorious defense; and (3) file the motion for new trial

when it would not cause delay or otherwise injure the prevailing party. Craddock, 133

S.W.2d at 126.

We will address the second prong, requiring that Wu set up a meritorious

defense. A meritorious defense is one that, if ultimately proved, will cause a different

result when the case is tried again. State Farm Life Ins. Co. v. Mosharaf, 794 S.W.2d

578 (Tex. App.—Houston [1st Dist.] 1990, writ denied) (citing The Moving Co. v. Whitten,

717 S.W.2d 117, 120 (Tex. App.—Houston [14th Dist.] 1986, writ ref’d n.r.e.)); see

3 Generally, a post-answer default judgment occurs when a defendant who has answered fails to appear for trial. Stoner v. Thompson, 578 S.W.2d 679, 682 (Tex. 1979). Here, the parties filed counter- petitions in the divorce proceeding.

5 O’Connell v. O’Connell, 843 S.W.2d 212, 218 (Tex. App.—Texarkana 1992, no writ)

(citing Mosharaf in family law case). The movant is not required to prove her defense

conclusively to satisfy the meritorious defense element, but must allege facts which in

law would constitute the meritorious defense and support the motion with affidavits or

other evidence establishing prima facie the existence of the meritorious defense. Ivy v.

Carrell, 407 S.W.2d 212, 214 (Tex. 1966).

Wu’s assertions in her motion for new trial involve the division of the community

property and the allocation of debt. She specifically states objections to the court’s

valuation of the homestead and to its order that each party bear responsibility for debt

the party incurred after the filing of the initial divorce petition.

The final decree awarded the homestead to Hsiang. He testified that the marital

property should be divided equally, and expressed his agreement to pay Wu her half of

the value of the homestead within thirty days of the final decree. He further testified that

an appraiser had placed a value on the homestead of about $250,000, and that the

Lubbock County Appraisal District valuation was about $40,000 higher. The appraiser’s

valuation was lower, he said, because the appraiser had deducted for some damage to

the house. He testified also that their insurance company had issued checks for the

damage and that Wu’s signature was needed on the checks. The final decree set the

value of the homestead at $259,000.

The trial court also heard evidence concerning the parties’ debts, Wu’s education

and earning capacity and the fact Wu’s student loan debt had been paid. Hsiang

testified to his willingness to assume all the couple’s debt except for a Discover card

6 account. At the close of the hearing, the judge stated, “The divorce is granted. The

Petitioner's request is granted. The 50/50 split is great with the Court.”

Wu’s new trial motion expressed no disagreement with the award of the

homestead to Hsiang nor to the payment to her of half its value. Her affidavit instead

asserted that the $259,000 value was “incorrect. The actual value of the home is

$299,356.00. This amount is the value set forth by the Lubbock County Appraisal

District which I believe to be a more accurate reflection of the actual value of the

home.”4

With regard to the allocation of debt, Wu’s affidavit states the decree’s

requirement that she pay all debts in her name incurred after the filing of the divorce

petition means that she is “wrongly” required to pay $14,000 for charges on the

Discover card account which she used “to purchase items necessary for the

maintenance and operation of the home, including the purchase of food, clothing and

other items necessary for the support of the child, myself and [Hsiang] during the

pendency of the divorce, while [Hsiang] and I lived together with the child."

A trial judge is charged with dividing the community estate in a "just and right"

manner, considering the rights of both parties. TEX. FAM. CODE ANN. § 7.001 (West

2006); Moroch v. Collins, 174 S.W.3d 849, 855 (Tex. App.—Dallas 2005, pet. denied).

The court has broad discretion in making the just and right division. Murff v. Murff, 615

S.W.2d 696, 698-99 (Tex. 1981); Boyd v. Boyd, 131 S.W.3d 605, 610 (Tex. App.—Fort

4 Wu further asserted that $10,000 in proceeds from insurance on the homestead should either be divided equally or added to the overall value of the home rather than awarded to Hsiang. Wu appears to contend the trial court awarded the insurance proceeds to Hsiang. We do not read the court’s judgment as doing so.

7 Worth 2004, no pet.). The record here shows the trial court heard evidence regarding

both the homestead valuation and the parties’ debts. It also shows the trial court took

pains to ensure that Wu received half the value of the homestead. The evidence

presented in Wu’s affidavit may be contrasted with that the court found adequate to set

up a meritorious defense in Morris v. Morris, 717 S.W.2d 189 (Tex. App.—Austin 1986,

no writ). The motion for new trial there alleged that the property division in the divorce

decree was not in accord with the parties' agreement and that community assets both

parties intended to go to the husband, such as his retirement benefits, were not

mentioned in the decree but left undivided. Id. at 192; see Miller v. Miller, 903 S.W.2d

45, 48 (Tex. App.—Tyler 1995, no pet.) (motion for new trial alleged facts bearing on

conservatorship of children and property division, including allegations of husband’s

physical abuse, a subject almost certainly not explored at the trial at which wife was not

present and only the husband testified).

The court here was aware of the difference between the appraiser’s valuation of

the homestead and the appraisal district’s valuation, and Wu’s assertion that the

appraiser’s valuation is “incorrect” because she believed the appraisal district’s

valuation was more accurate merely presented her contrary view on a subject the court

already had considered. The court also heard testimony that the only debt allocated to

Wu was the Discover card account while Hsiang assumed the remaining debt. We see

no abuse of discretion in the trial court’s implicit conclusion that Wu’s assertion it was

wrong for her to be saddled with the Discover card account because both parties

benefitted from its charges failed to state facts which, if proven, would lead to a different

just and right division of property or allocation of debt on retrial. We thus see no abuse

8 of discretion in a conclusion that neither of Wu’s assertions set up a meritorious defense

warranting a new trial.

Accordingly, we find Wu has failed to satisfy the second Craddock prong and,

because Wu failed to establish each of the three Craddock factors, we resolve Wu’s

appellate issue against her. We affirm the judgment of the trial court.

James T. Campbell Justice