Owens-Corning Fiberglas Corp. v. Caldwell

822 S.W.2d 143, 1991 Tex. App. LEXIS 2903, 1991 WL 248674
Court of Appeals of Texas·Decided November 21, 1991·No. Nos. 01-91-00681-CV, 01-91-00748-CV·Published·Cited by 2 cases

Opinion

OPINION

SAM BASS, Justice.

In the first of these two proceedings (01-91-00681-CV), relator, Owens-Corning Fiberglas Corporation (OCF), seeks mandamus relief from respondent’s, Judge Neil Caldwell’s, order in the underlying causes1 requiring it to produce for in camera inspection (1) “costs of services for counsel” documents, and (2) “reserves for asbestos claims losses” documents. Additionally, OCF asks this Court (1) to direct Judge Caldwell to modify another order to provide that an outstanding sanction of $320,-000 in attorneys’ fees be due and payable at or after the time of final judgment, and (2) to remove the remaining sanctions issues from the master in chancery. No response has been filed on behalf of Judge Caldwell in this first proceeding.

In the second proceeding (01-91-00748-CV), OCF, the law firm of Wright, Robinson, McCammon, Osthimer & Tatum (Wright, Robinson), and attorney Richard K. Hines (Hines)2 seek mandamus relief from a third order of Judge Caldwell in the underlying causes, reimposing fines against them, respectively, of $2,656,160, $250,000, and $50,000.

[145]*145As detailed at the end of this opinion, the writ of mandamus is conditionally granted with respect to the documents ordered produced for in camera inspection and to the deferral of the attorneys’-fees sanction; the writ of mandamus is granted with respect to the reimposition of monetary fines against OCF, Wright, Robinson, and Hines; all further relief is denied.

History of these Proceedings

These proceedings are not the first time these parties have come before this Court. We begin by reviewing the events that preceded these mandamus petitions.

In an amended sanctions order dated January 11, 1991 (the amended sanctions order), Judge Caldwell found that OCF, Wright, Robinson, and Hines had abused the discovery process and obstructed the judicial process in the underlying causes. The amended sanctions order fined them, respectively, $2,356,160, $250,000, and $50,-000. The order also directed OCF to pay $320,000 in attorneys’ fees to the plaintiffs’ attorneys.3

OCF, Wright, Robinson, and Hines sought mandamus relief from this Court, arguing that Tex.R.Civ.P. 215(3) does not allow monetary fines and that the amended sanctions order imposing them was void. With respect to attorneys’ fees, OCF argued that they could be imposed only after notice and hearing and that, while a hearing had been held before the master in chancery, no de novo evidentiary hearing had been held before the trial court.

We held that rule 215(3) allowed imposition only of the sanctions specifically mentioned therein. Owens-Corning Fiberglas Corp. v. Caldwell, 807 S.W.2d 413, 415 (Tex.App.—Houston [1st Dist.] 1991, orig. proceeding [leave denied] ).4 Because fines are not mentioned in rule 215(3), we held the portion of Judge Caldwell’s amended sanctions order assessing fines against the relators void. Id. at 416. OCF could cite no legal authority for its conclusion that an attorneys’-fees sanction is void without a de novo evidentiary hearing before the trial court (after a hearing before the master). Therefore, we found OCF had not established its right to mandamus concerning the attorneys’-fees sanction. Id. at 417. We conditionally granted the petition for writ of mandamus in part and ordered Judge Caldwell to vacate the portion of his amended sanctions order assessing fines. Id.

On March 21, 1991, OCF filed a petition for writ of mandamus in the Texas Supreme Court, asking it to vacate only the attorneys’ fees sanction under the amended sanctions order. The supreme court stayed the amended sanctions order “regarding the payment of sanctions and attorneys fees,” pending disposition of the motion for leave to file the petition for writ of mandamus. On June 19, 1991, the supreme court vacated its stay and denied leave to file OCF’s petition for writ of mandamus, stating in its per curiam opinion:

In this original mandamus proceeding relator seeks review of sanctions imposed by respondents [sic] for abuse of discovery. We believe that the trial court should have the opportunity to reconsider the rulings of which relator complains in this proceeding in light of our opinion today in Braden v. Downey, 811 S.W.2d 922 (Tex.1991, orig. proceeding).5 Accordingly, we vacate our order staying proceedings and deny leave to file this petition for writ of mandamus, without addressing its merits and without prejudice to relator again requesting relief from the court of appeals and this Court after the trial court has had an opportunity to reconsider its rulings.

(Emphasis added.)

On June 25, 1991, OCF moved the trial court to vacate the fines in the amended [146]*146sanctions order, as directed by this Court in Owens-Coming, and to provide that the attorneys’-fees sanction be made payable only after a final judgment, in accordance with Braden. In their response to OCF’s motion, we understand the plaintiffs to be suggesting that the trial court obtain from OCF records showing its counsel costs. The plaintiffs state the records appear relevant in assessing the amount of the attorneys’-fees sanction. They made no suggestion concerning information on the asbestos claims losses reserves. However, the plaintiffs made no motion to discover any of these documents, nor was there any indication that the documents would be turned over to the plaintiffs.

On July 8, 1991, Judge Caldwell ordered OCF to provide the following within 30 days for in camera inspection by the master (the July 8 order):

1. Copies of all documents (whether checks, statements, bills, payments, or credit arrangements) showing the costs of services for counsel representing OCF in the underlying causes, including the 11 law firms and attorneys filing pleadings on behalf of OCF (“the costs of services for counsel” documents); and
2. Copies of any current financial statement, annual report, or other report or document showing the reserves set aside or the estimate of future costs of meeting projected losses from asbestos claims and the effect of those projections on OCF’s health (“the reserves for asbestos claims losses” documents).

Judge Caldwell stated in a letter to all counsel of record that he needed the information “before I can make the findings required by Braden v. Downey as to Defendant OCF’s ability to respond with monetary sanctions.”

On July 12, 1991, OCF moved the trial court to vacate the monetary fines assessed against it under the amended sanctions order. On July 16, OCF moved the trial court to reconsider or modify the July 8 order, stating that the information was irrelevant and called for production of documents protected by the attorney-client and work product privileges. OCF also asked the trial court to remove the master in chancery from the issues in the July 8 order. The trial court took no action on OCF’s motions of June 25 and July 12 and 16.

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Owens-Corning Fiberglas Corp. v. Caldwell, 822 S.W.2d 143, 1991 Tex. App. LEXIS 2903, 1991 WL 248674 (Tex. Ct. App. 1991).

822 S.W.2d 143 (Owens-Corning Fiberglas Corp. v. Caldwell) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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