Opinion issued May 18, 2023
In The
Court of Appeals For The
First District of Texas ———————————— NO. 01-21-00706-CV ——————————— SHAMIM MEMON AND DISCOVERY MM SERVICES, INC., Appellants V. VY THUAN NGUYEN AND VY NGUYEN & ASSOCIATES, PLLC, Appellees
On Appeal from the 151st District Court Harris County, Texas Trial Court Case No. 2020-41068
MEMORANDUM OPINION
Appellants Shamim Memon and Discovery MM Services, Inc. sued Vy Thuan
Nguyen and Vy Nguyen & Associates, PLLC (collectively, “Nguyen” or
“appellees”) for legal malpractice and related claims arising from their representation in a breach-of-contract case (“Meisner case”).1 A court-appointed
Receiver in the Meisner case intervened in the trial court below and settled the
claims against appellees, resulting in an agreed judgment. The trial court denied
appellants’ motion to set aside the agreed judgment.
On appeal, appellants complain that: (1) there cannot be an agreed judgment
without all parties’ participation, (2) the Receiver did not have authority to enter the
settlement, (3) the Meisner court was required to review the judgment before it was
entered, (4) the Receiver’s basis for intervening did not exist at the time of the
judgment, (5) the Receiver could not settle the case without providing a credit to
appellants against the Meisner judgment, (6) the Receiver was subject to discovery
requests, and (7) the Receiver could not settle a legal malpractice claim while a
grievance was pending. Because the turnover order provides the Receiver the
authority to settle the case, the requirements for an agreed judgment are satisfied,
and we are not the proper court to correct any potential errors in the turnover order,
we affirm.
Background
Nguyen represented appellants in the Meisner case. Nguyen failed to attend
the arbitration in the Meisner case, and an arbitration award against appellants was
1 Carl Meisner, M.D. and Gulf Coast Medical Research, LLC v. Shamim Memon and Discovery MM Services, Inc., No. 18-DCV-249080, in the 240th District Court in Fort Bend County, Texas. 2 confirmed as a final judgment. Appellants retained new counsel and moved to vacate
the award, asserting that illness had prevented Nguyen from attending the arbitration
and the arbitrator unreasonably denied a continuance. The Meisner court vacated the
award and remanded the matter to the arbitrator. But the award was reinstated when
the Meisner plaintiffs produced evidence that Nguyen appeared at another hearing
during the arbitration, suggesting Nguyen’s illness had been fabricated. Appellants
sued Nguyen for legal malpractice, fraud, and deceptive trade practices
(“Malpractice Action”), claiming Nguyen lied.
While the Malpractice Action was pending in the trial court below, the
Meisner court appointed a Receiver to collect the final judgment against appellants.
The Receiver was vested with the power to “settle or direct any litigation leading to
a potential recovery of money or assets . . . .” She intervened in the Malpractice
Action, pleading that she was a necessary party as “the sole person with authority to
prosecute, or to authorize another to prosecute, the claims and causes of action
asserted by [appellants] in [the Malpractice Action], and the sole person with
authority to make decisions regarding any compromise or settlement of those claims
and causes of action.”
The Receiver ultimately settled the claims against Nguyen in the Malpractice
Action, resulting in an agreed take-nothing judgment in Nguyen’s favor. The trial
3 court signed the judgment. Appellants moved to set aside the judgment, and the trial
court denied their motion.
Receiver’s Authority
First, Appellants argue that because they did not participate in the agreed
judgment, the trial court erred by signing it. Secondly, they contend that the Receiver
lacked the authority to enter an agreed judgment. Appellees respond that the Meisner
court’s turnover order granted the Receiver the authority to control the course of the
Malpractice Action, including the ability to settle claims. Because these issues
overlap, we address them together.
A. Standard of Review
An agreed judgment is interpreted as if it were a contract between the parties,
and the interpretation of the judgment is governed by the laws of contracts. See
McCray v. McCray, 584 S.W.2d 279, 281 (Tex. 1979); Hydroscience Techs., Inc. v.
Hydroscience, Inc., 401 S.W.3d 783, 796 (Tex. App.—Dallas 2013, pet. denied).
Whether an agreement is legally enforceable is a question of law. Ronin v. Lerner, 7
S.W.3d 883, 886 (Tex. App.—Houston [1st Dist.] 1999, no pet.). We review
questions of law de novo. In re Humphreys, 880 S.W.2d 402, 404 (Tex. 1994).
B. Analysis
It is undisputed that the Receiver was properly appointed by the Meisner court
and intervened in the Malpractice Action. The turnover order states:
4 [T]he Receiver is vested with the right, power, and authority to take complete control and possession of all leviable property of [appellants] that is in the actual or constructive possession, custody or control of [appellants], to the exclusion of all other persons . . . as well as the following non-exempt property and that all such property, wherever located, shall be held in custodia legis of the Receiver as of the date of this Order . . . (8) causes of action or choses of action; (9) the right, power and authority to initiate and conduct the course of litigation to recover any debts, damages or property belonging to [appellants] . . . This Court Order further gives the Receiver the right, power and authority to commence, maintain, settle and control the course of litigation to recover any debts, damages or property belonging to [appellants] as well as the right, power and authority to settle or direct any litigation leading to the potential recovery of money or assets . . . .
Appellants rely on Flores v. Sandoval to support their contention that the trial
court’s agreed judgment is invalid because they did not participate in the Receiver’s
settlement with appellees or consent to entry of an agreed judgment. See No.
01-02-01197-CV, 2004 WL 966328, at *2 (Tex. App.—Houston [1st Dist.] May 6,
2004, no pet.) (mem. op.) (citing Cary v. Cary, 894 S.W.2d 111, 112 (Tex. App.—
Houston [1st Dist.] 1995, no writ) (“It has long been the law of this state that a court
cannot render a valid consent judgment unless at the time of rendition, all parties
consent to the agreement underlying the judgment.”)). But the turnover order allows
the Receiver to settle a case. The order grants the Receiver the power take control of
all leviable property of appellants, including causes of action, and the power to settle
any litigation leading to the potential recovery of money or assets. Appellants do not
allege any acts by the Receiver except those performed in her capacity as receiver.
5 Moreover, settling a cause of action is within the bounds of the turnover order. See
Davis v. West, 317 S.W.3d 301, 308 (Tex. App.—Houston [1st Dist.] 2009, no pet.).
Having concluded that the Receiver acted within the limits of the turnover
order appointing her, we next must consider whether the requirements for an agreed
judgment were satisfied. An agreed judgment is a final judgment on the merits. In
re J.G.W., 54 S.W.3d 826, 832 (Tex. App.—Texarkana 2001, no pet.). The
agreement is no longer a contract among private individuals but a judgment of the
court. Ex parte Gorena, 595 S.W.2d 841, 844 (Tex. 1979) (“Despite the fact that a
judgment has its genesis in an agreement between the parties, the judgment itself has
an independent status.”). An agreed judgment has the same effect as any court
judgment. Gulf Ins. Co. v. Burns Motors, Inc., 22 S.W.3d 417, 422 (Tex. 2000). “[I]t
has neither less nor greater force or effect than it would have had [if] it [had] been
rendered after litigation, except to the extent that the consent excuses error and
operates to end all controversy between the parties.” Id. The judgment “must be in
strict or literal compliance” with the terms of the settlement agreement. Vickrey v.
Am. Youth Camps, Inc., 532 S.W.2d 292, 292 (Tex. 1976).
Appellees contend that because the agreed judgment complies with Rule 11
there is no issue here. TEX. R. CIV. P. 11. For a Rule 11 agreement to be enforceable,
it must be either (1) in writing, signed, and filed as part of the record, or (2) it must
be made in open court and entered of record. Id.; Padilla v. LaFrance, 907 S.W.2d
6 454, 460 (Tex. 1995). A Rule 11 agreement is valid if “a written memorandum which
is complete within itself in every material detail, and which contains all of the
essential elements of the agreement, so that the contract can be ascertained from the
writings without resorting to oral testimony.” Padilla, 907 S.W.2d at 460. Rule 11’s
purpose is to ensure that agreements of counsel affecting their clients’ interests are
not left to the fallibility of human recollection and so that the agreements themselves
do not become sources of controversy. Padilla, 907 S.W.2d at 464 (Enoch, J.,
dissenting); ExxonMobil Corp. v. Valence Operating Co., 174 S.W.3d 303, 309
(Tex. App.—Houston [1st Dist.] 2005, pet. denied).
Therefore, we must consider whether the agreement is in writing, signed, and
filed as part of the record, or that it was made in open court and entered into the
record. TEX. R. CIV. P. 11. It is undisputed that the judgment was put in writing,
signed by the Receiver’s counsel and appellees’ counsel, and filed as part of the
record. Thus, Rule 11 is satisfied. See id.
According to appellees, because they satisfied Rule 11, the trial court had no
choice but to enforce the agreement. See EZ Pawn Corp. v. Mancias, 934 S.W.2d
87, 91 (Tex. 1996). But that is not the end of the analysis. When parties enter into a
valid Rule 11 agreement to settle a case, the parties must consent to the agreement
at the time the trial court renders judgment. See Kennedy v. Hyde, 682 S.W.2d 525,
528 (Tex. 1984). “When a trial court has knowledge that one of the parties to a suit
7 does not consent to a judgment, the trial court should refuse to sanction the
agreement by making it the judgment of the court.” Quintero v. Jim Walter Homes,
Inc., 654 S.W.2d 442, 444 (Tex. 1983).
A party may revoke its consent to a settlement agreement at any time before
a court renders judgment on the agreement. Padilla, 907 S.W.2d at 461 (“[C]ourt
cannot render a valid agreed judgment absent consent at the time it is rendered.”
(emphasis added)); S & A Rest. Corp. v. 442 Leal, 892 S.W.2d 855, 857 (Tex.
1995) (“A party may revoke its consent to a settlement agreement at any time before
judgment is rendered on the agreement.”). A trial court renders judgment when it
“officially announces its decision in open court or by written memorandum filed
with the clerk.” Leal, 892 S.W.2d at 857. An agreed judgment rendered after one of
the parties revokes its consent is void. Id.; Samples Exterminators v. Samples, 640
S.W.2d 873, 874–75 (Tex. 1982).
Here, the Receiver properly intervened in the trial court asserting that it had
complete control and possession of appellants’ cause of action through the turnover
order. The validity of the turnover order is not at issue. So, we are left to review
whether the Receiver and appellees consented at the time the agreed judgment was
rendered. See Kennedy, 682 S.W.2d at 528–29 (requiring that Rule 11 be satisfied
and that the parties consented for an agreed judgment to be valid). There is no dispute
that Receiver and appellees consented to the judgment at the time it was rendered.
8 Their attorneys submitted the proposed judgment in agreement, and no one is
asserting that either the Receiver or appellee revoked their consent prior to the trial
court rendering judgment.
Next, we consider whether the judgment disposed of all remaining parties and
claims. See Lehmann v. Har-Con Corp., 39 S.W.3d 191, 200 (Tex. 2001). A
judgment is final if it states that it disposes of all claims and parties, or if the record
evidences the intent that the judgment disposes of all claims and all parties. See id.
at 192. The judgment here includes finality language stating that it “is a final
judgment disposing of all claims that were raised or could have been raised before
the [Court] among the parties.”
Finally, appellants contend that the Receiver’s decision to settle the
Malpractice Action claims that were turned over and the turnover order itself violate
public policy and the Texas Constitution. This appeal is not the proper vehicle to
attack the Meisner court’s turnover order. To the extent appellants argue that the
turnover order contains an error by ordering them to surrender the Malpractice
Action claims, they may not circumvent the ordinary process to correct the alleged
error. See Browning v. Placke, 698 S.W.2d 362, 363 (Tex. 1985) (non-jurisdictional
deficiencies must be corrected on direct attack); see also Davis, 317 S.W.3d at 309–
10 (“[T]urnover orders must be attacked on direct appeal.”).
We overrule appellants’ two issues.
9 Review by the Meisner Court
Third, Appellants contend that the judgment required review by the Meisner
court and the trial court before the judgment could be rendered. Appellees contend
that there is no authority to support appellants’ position.
Rule 38.1 requires an appellant’s brief to “state concisely all issues or points
presented for review,” to “state concisely and without argument the facts pertinent
to the issues or points presented . . . [and] be supported by record references,” and
to “contain a clear and concise argument for the contentions made, with appropriate
citations to authorities and to the record.” TEX. R. APP. P. 38.1(f), (g), (i). Appellants
have provided no authority to support their contention, nor have we found any.
Guimaraes v. Brann, 562 S.W.3d 521, 545 (Tex. App.—Houston [1st Dist.] 2018,
pet. denied) (“A brief that does not contain citations to appropriate authorities and
to the record for a given issue waives that issue.”). Receivers may perform acts
regarding the property at issue as authorized by the appointing court. See TEX. CIV.
PRAC. & REM. CODE § 64.031(5). The turnover order issued by the Meisner court
gave the Receiver the authority to take control of the appellants’ causes of action,
and the power to settle any litigation. Since appellants have failed to appropriately
brief the issue as required, it is considered waived.
10 Receiver’s Intervention
Fourth, Appellants contend that the Receiver was an improper intervenor
because she did not have a justiciable interest in the Malpractice Action.
Appellants argue that because the agreed judgment resulted in a “take[-]
nothing” judgment, the Receiver no longer had a justiciable interest in the matter.
Appellees disagree and rely in part on facts outside the appellate record. We do not
consider exhibits or appendices to briefs or motions that are not part of the appellate
record. Sewell v. Adams, 854 S.W.2d 257, 259 n.1 (Tex. App.—Houston [14th Dist.]
1993, no writ); Mitchison v. Hous. Indep. Sch. Dist., 803 S.W.2d 769, 771 (Tex.
App.—Houston [14th Dist.] 1991, writ denied).
A party with a justiciable interest may intervene in a pending suit as a matter
of right. Nghiem v. Sajib, 567 S.W.3d 718, 721 (Tex. 2019); see TEX. R. CIV. P. 60.
A party may intervene if the intervenor could have “brought the [pending] action, or
any part thereof, in his own name.” Guar. Fed. Sav. Bank v. Horseshoe Operating
Co., 793 S.W.2d 652, 657 (Tex. 1990). The Receiver had the right to intervene under
the authority given to her by the turnover order. The order grants the Receiver the
power to take control of all of appellants’ causes of action, to initiate litigation, and
to settle any litigation. Because the Receiver could have initiated the lawsuit on her
own, she had a justiciable interest in the case. See id.
We overrule appellants’ issue.
11 Credit toward Meisner Court’s Judgment
Fifth, Appellants contend that the Receiver’s failure to recover any funds to
satisfy the Meisner judgment conflicts with that judgment and the turnover order.
Appellees respond that funds were recovered as part of the settlement and applied
toward the satisfaction of the Meisner judgment.
Appellants note that sections 31.002 and chapter 64 of the Texas Civil Practice
and Remedies Code are the basis of the Receiver’s authority. No one disputes that a
court may “appoint a receiver with the authority to take possession of non-exempt
property . . . to the extent required to satisfy the judgment,” TEX. CIV. PRAC. & REM.
CODE § 31.002(b)(3), or that Chapter 64 addresses receivership, id. §§ 64.001–.108.
However, appellants assert that because the Receiver agreed to a take-nothing
judgment, she acted contrary to the Meisner court’s turnover order and statutes.
Appellants contend that this situation is like the situation in Gillet v. ZUPT, LLC,
523 S.W.3d 749 (Tex. App.—Houston [14th Dist.] 2017, no pet.), where the court
of appeals addressed a trial court’s turnover order on direct appeal. Gillet addressed
a receiver’s actions that were based on an inconsistency between the trial court’s
turnover order and its judgment. Id. at 759 (reversing turnover order that was
inconsistent with final judgment).
As noted earlier, the turnover order gives the Receiver the authority to settle
a cause of action that has been turned over. See Davis, 317 S.W.3d at 308. Here, in
12 what would be a collateral attack to the turnover order, appellants do not complain
of such a conflict. This distinguishes Gillet. Instead, appellants complain that the
Receiver violated the turnover order and statutes by settling a case under terms that
do not provide a “credit” towards the Meisner judgment. This was not raised before
the trial court, so it is not preserved for our review. See TEX. R. APP. P.
33.1(a) (requiring that motion state grounds for requested ruling “with sufficient
specificity to make the trial court aware of the complaint.”).
Meisner Court Discovery Requests
Sixth, Appellants complain that the Receiver denied their requests for
production in a separate discovery dispute before the Meisner court.
This argument was not raised before the trial court, so it is not preserved for
our review. See TEX. R. APP. P. 33.1(a) (requiring that motion state grounds for
requested ruling “with sufficient specificity to make the trial court aware of the
complaint.”). Appellants also rely on documents that are outside the appellate record.
We cannot consider exhibits or appendices to briefs or motions that are not part of
the appellate record. Sewell, 854 S.W.2d at 259 n.1. Because the issue was not
preserved for review and appellants have provided the Court with no authority
indicating that we may review the issue raised, we overrule appellants’ issue.
13 Pending Grievance
Lastly, Appellants argue that because there is a grievance against Nguyen, the
trial court should not have entered the agreed judgment in the Malpractice Action.
Appellees respond that any pending grievance has no bearing on the trial court’s
ability to enter the agreed judgment.
The grievance discussed by appellants is outside the appellate record. We
cannot consider exhibits or appendices to briefs or motions that are not part of the
appellate record. Sewell, 854 S.W.2d at 259 n.1. Additionally, Rule 38.1 requires an
appellant’s brief to “contain a clear and concise argument for the contentions made,
with appropriate citations to authorities and to the record.” TEX. R. APP. P. 38.1 (i).
Again, appellants have provided no authority to support their contention, nor have
we found any. Guimaraes, 562 S.W.3d at 545. Because we cannot consider exhibits
or appendices to briefs or motions that are not part of the appellate record and
appellants have failed to identify any authority for the Court to address the issue, the
issue is overruled.
14 Conclusion
We affirm the trial court’s judgment.
Sarah Beth Landau Justice
Panel consists of Justices Kelly, Landau, and Farris.