Kosowska v. Khan

929 S.W.2d 505, 1996 WL 460008
CourtCourt of Appeals of Texas
DecidedOctober 3, 1996
Docket04-95-00217-CV
StatusPublished
Cited by33 cases

This text of 929 S.W.2d 505 (Kosowska v. Khan) is published on Counsel Stack Legal Research, covering Court of Appeals of Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Kosowska v. Khan, 929 S.W.2d 505, 1996 WL 460008 (Tex. Ct. App. 1996).

Opinions

OPINION

HARDBERGER, Justice.

This appeal presents issues concerning the enforceability of a Rule 11 agreement and duress. Kosowska, the appellant, appeals from a summary judgment granted in favor of Khan in this Deceptive Trade Practices Act (DTPA) case. Because we believe that she entered into a valid and binding settlement agreement with Khan, we affirm.

Facts

Kosowska took her 1986 Volvo to the ap-pellee (Khan’s) garage, the Colonies North Exxon Car Care Center, where, she says, they totally destroyed her car’s engine. Ko-sowska filed suit against Khan on March 27, 1992 claiming that Khan violated sections of the DTPA regarding the manner in which he repaired her car. This first lawsuit was settled by Khan and Kosowska on August 13, 1992 when they entered into a compromise and settlement agreement for $10,000. This agreement was recorded by a court reporter at the defense lawyer’s office. On August 18, 1992 the statement on the record as taken by a certified shorthand reporter was filed in cause number 203,311 (the first lawsuit). On August 24, 1992, Kosowska repudiated the oral agreement. She said that her attorney had forced her into the agreement by claiming that Khan’s lawyers had some letters which were embarrassing to her. After several continuances requested by Kosowska were granted, the case was dismissed for want of prosecution on January 25, 1993. The order was entered with prejudice.

Kosowska perfected an appeal from the order dismissing the March 1992 lawsuit with prejudice for lack of prosecution. This court filed an unpublished opinion affirming the order to dismiss but reforming the judgment to reflect that the dismissal was without prejudice.

On December 20,1993, Kosowska filed her second lawsuit against Khan alleging claims identical to the first suit. This appeal arises out of a judgment entered in that second lawsuit. Khan filed a motion for summary judgment arguing that the claims being litigated in the second lawsuit had previously [507]*507been compromised and settled by the parties on August 13, 1992. On January 6, 1995, Khan’s motion for summary judgment was granted by the trial court and a final judgment was entered in which the compromise and settlement agreement was found to be valid and enforceable. The trial court specifically declined to find that the compromise and settlement agreement between the parties was the result of duress or undue influence.

The defendant, Khan, deposited $10,000 into the registry of the court on January 18, 1995. Kosowska’s second lawyer filed a notice of transfer and assignment of interest in cause of action and petition. The trial court ordered the county clerk to release the sum of $4,138 to the second lawyer over Kosows-ka’s objection. A judgment creditor of Ko-sowska filed an intervention in the suit and obtained a turnover order directing the county clerk to pay the remainder of the money in the registry of the court to him. Again, this was done over Kosowska’s objection.

The Settlement Agreement

In her first point of error, Kosowska argues that the trial court erred in granting Khan’s motion for summary judgment because Khan failed to establish that there were no genuine issues of material fact related to the criteria for enforceability of a settlement agreement pursuant to Rule 11. Ko-sowska argues that the evidence shows that the settlement agreement was never signed. Kosowska also argues that the agreement is not an enforceable Rule 11 agreement because it was not made in open court. According to Kosowska, contract law cannot be applied to enforce an agreement that does not comply with Rule 11.

Texas Rule of Civil Procedure 11 provides as follows:

Unless otherwise provided in these rules, no agreement between attorneys or parties touching any suit pending will be enforced unless it be in writing, signed and filed with the papers as part of the record, or unless it be made in open court and entered of record.

The Texas Supreme Court has recently reaffirmed the rationale supporting Rule 11. The court, quoting earlier decisions, stated that Rule 11 exists because verbal agreements of counsel respecting the disposition of cases are very likely to be misconstrued and forgotten and to lead to misunderstandings and controversies. Padilla v. LaFrance, 907 S.W.2d 454, 460 (Tex.1995). A settlement agreement must comply with Rule 11 to be enforceable. Id.; Kennedy v. Hyde, 682 S.W.2d 525, 526 (Tex.1984).

The Texas Supreme Court has said that in construing Rule 11 and any exceptions to it, “an examination of the policy behind the rule is always paramount.” Kennedy, 682 S.W.2d at 529. The court also said the following regarding the construction of Rule 11:

Our holding, that Rule 11 means precisely what it says, should not be interpreted as requiring “slavish adherence” to the literal language of the rule in all cases ... To the contrary, there are well recognized exceptions to the rule in this state, and in other jurisdictions with similar requirements ... For example, an undisputed stipulation may be given without literal compliance with the rule ... Likewise, an agreement in compliance with the rule is subject to attack on the grounds of fraud or mistake, ... and a nonconforming agreement may be enforced for similar equitable reasons ... Quite recently this court has interpreted the requirements of Rule 11 liberally to conform to modern trial practice....

Id. (citations omitted). We believe this case fits the above language. The purpose of Rule 11 is to prevent parties from misconstruing oral agreements. This is achieved by requiring the agreements to be memorialized in one of two ways. First, an agreement can be made in writing, signed by both parties and filed with the court. Second, the agreement can be made in open court and entered of record. These two provisions allow the agreements to be put into written form and kept with the court’s records so that the parties to the suit cannot dispute its existence or contents. In this case, there is no question that there was an earlier oral agreement which was memorialized in writing. [508]*508Kosowska is attempting to avoid the effect of her agreement.

The agreement in this case comports with the policy behind Rule 11. See Kennedy, 682 S.W.2d at 529. The agreement was made between Kosowska and Khan before a certified shorthand reporter and notaiy public. The agreement recites who was present at its making, the terms of the settlement and release, Kosowska’s acceptance, and Kosows-ka’s acknowledgement that the settlement, recited, was true and correct. The settlement agreement was transcribed by the court reporter and signed by her. The settlement agreement was then filed with court and made a part of the record. The settlement agreement was a signed writing filed with the court. At the time it was entered into, Kosowska clearly agreed to it. Kosows-ka later changed her mind and sought to avoid the agreement.

We hold that the settlement agreement in this ease is in substantial compliance with Rule 11 as a matter of law. We overrule Kosowska’s first point of error.

Duress

In her second point of error, Ko-sowska argues that her acceptance of the settlement offer was the result of the undue influence and duress exerted on her by her attorney.

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Bluebook (online)
929 S.W.2d 505, 1996 WL 460008, Counsel Stack Legal Research, https://law.counselstack.com/opinion/kosowska-v-khan-texapp-1996.