Tracy Jo Mullins v. Matt Robert Mullins

Opinion

COURT OF APPEALS SECOND DISTRICT OF TEXAS FORT WORTH

NO. 02-16-00449-CV

TRACY JO MULLINS APPELLANT

V.

MATT ROBERT MULLINS APPELLEE

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FROM COUNTY COURT AT LAW NO. 2 OF PARKER COUNTY TRIAL COURT NO. CIV-16-0139

MEMORANDUM OPINION1

To impose “death-penalty” sanctions for litigation misconduct (including

failing to properly respond to discovery requests), a trial court must consider

whether lesser sanctions would address the misconduct and provide a reasoned

explanation concerning the appropriateness of the sanction imposed. In this

divorce case, the trial court imposed death-penalty sanctions against appellant

1 See Tex. R. App. P. 47.4. Tracy Jo Mullins without providing any such reasoned explanation concerning the

appropriateness of a death-penalty sanction as the initial sanction. Therefore,

we reverse the trial court’s order imposing sanctions along with the final decree

of divorce that depends upon the sanctions order, and we remand this case for

further proceedings.

Background Facts

This appeal arises from a dissolution of a marriage pursuant to death-

penalty sanctions. Tracy filed for a divorce from appellee Matt Robert Mullins in

February 2016, and Matt answered the petition and filed a counter-petition for

divorce in March 2016. In his counter-petition, Matt pled claims of forgery,

breach of fiduciary duty, fraud, and misapplication of community property.

Over the next several months, Tracy largely failed to cooperate with oral

and written discovery. In late April 2016, Matt filed a combined motion for

sanctions and motion to compel discovery. In that motion, he alleged that Tracy

had not timely responded to written discovery requests and that during a

deposition, Tracy had refused to answer several questions while being “hostile,

defiant, and argumentative.” Matt attached excerpts from the deposition showing

that Tracy had refused to answer several questions.

The trial court set a hearing on Matt’s motion. But without holding a

hearing, as part of a June 2016 temporary order that concerned other matters

such as conservatorship and possession of the parties’ children and child

support, the trial court stated that it would “take up and consider [Matt’s] Motion

2 for Sanctions and Motion to Compel Discovery at a later date.” In that order, the

trial court found that Matt’s attorney’s fees for preparing the motion for sanctions

comprised $11,385, but the trial court did not order Tracy to pay those fees. The

trial court ordered Tracy to fully respond to Matt’s discovery requests.

Later, the trial court again set a hearing on Matt’s motion for sanctions and

motion to compel discovery. The parties then agreed to an order that addressed

those motions. In the agreed order, the trial court found that Tracy had failed to

respond to Matt’s written discovery requests and had failed to answer deposition

questions. The court did not sanction Tracy, but the court again ordered her to

respond to the discovery requests. The trial court expressly deferred any

decision on sanctions “until [a] later hearing.” Tracy and Matt signed the agreed

order.

Tracy did not answer the discovery requests to Matt’s satisfaction, so he

filed another motion for sanctions. He contended that Tracy had failed to provide

any answers to interrogatories. He also alleged that while Tracy had produced

some documents, the documents were not “identified nor categorized to a

particular discovery request.” Matt further alleged that Tracy had not provided an

accounting that the trial court had ordered her to provide and had not appeared

to answer previously unanswered deposition questions. Matt asked the trial

court to impose “all available sanctions” against Tracy and to order her to pay his

attorney’s fees.

3 The trial court set the second motion for sanctions for a hearing. At the

hearing, Matt conceded that Tracy had produced some documents but stated

that the documents had not been identified, organized, or Bates stamped. Matt

also stated that Tracy had not responded at all to other discovery requests. Matt

asked for severe sanctions, including the granting of a default judgment. He

argued that the court had been lenient with Tracy and that she had not done “one

single thing” that the court had asked her to do. His counsel stated, “I don’t think

issuing a third order compelling her to do anything is a solution. I think the real

solution is to give us the pathway by which we can obtain a divorce, have you

divide what there is to divide, and get on down the road for us.”

After completing the hearing, at which Tracy did not appear personally or

through counsel, the trial court signed an order granting the motion. The court’s

order stated that the sanctions were “reasonable and necessary” and that Tracy

had failed to respond to discovery despite the trial court’s prior orders requiring

her to do so. The trial court sanctioned Tracy by striking her pleadings, ordering

her to pay Matt’s expenses and attorney’s fees, preventing her from conducting

discovery, foreclosing her ability to present evidence of any claims or defenses,

prohibiting her from refuting any of Matt’s claims or defenses, and granting a

default judgment in Matt’s favor.2 Neither the order granting sanctions nor the

2 These qualify as death-penalty sanctions. See Young v. Young, No. 03- 14-00720-CV, 2016 WL 7339117, at *3 (Tex. App.—Austin Dec. 15, 2016, no pet.) (mem. op.) (citing Braden v. Downey, 811 S.W.2d 922, 929 (Tex. 1991)).

4 hearing leading to the order contained a statement by the trial court concerning

why lesser sanctions would not be appropriate or why death-penalty sanctions

were necessary.

Six days after signing the sanctions order, the trial court held a default

prove-up hearing without the presence of Tracy or her counsel. At that hearing,

Matt’s counsel stated that the sanctions order was an “integral part of . . . going

forward on this matter.” Matt testified about various matters related to the

parties’ marriage, child-rearing, property, and litigation history and presented

documents relating to those issues.

Following the hearing, the trial court signed a final decree of divorce. In

the final decree, the court took judicial notice of its sanctions order. The court

dissolved the parties’ marriage, appointed Matt sole managing conservator of the

children while appointing Tracy possessory conservator, gave each party periods

of possession of the children, and ordered Tracy to pay monthly child support.

The court also found that Tracy had committed forgery, fraud, and conversion

and had breached a fiduciary duty to Matt, and the court ordered Tracy to pay

$150,000 in exemplary damages. Finally, the court entered a permanent

injunction that precluded Tracy from committing certain acts and ordered her to

pay attorney’s fees “over and above the judgment for sanctions” previously

awarded to Matt.

Represented by new counsel, Tracy filed a motion in which she asked the

trial court to vacate the death-penalty sanctions and grant a new trial. Following

5 a hearing, the trial court denied Tracy’s motion for new trial. She brought this

appeal.

“Death-penalty” Sanctions

Tracy raises four issues on appeal from the trial court’s judgment. In her

second issue, she argues that the trial court erred when it assessed death-

penalty sanctions because the court did not consider the availability of lesser

sanctions and whether such sanctions would promote compliance or provide a

reasoned explanation why lesser sanctions would not have been effective. In

response to Tracy’s second issue, Matt argues that although the court never

imposed sanctions, the court considered lesser sanctions in that the court

previously deferred ruling on sanctions, thus giving Tracy a “pass.”

We review a trial court’s imposition of sanctions for an abuse of discretion.

Nath v. Tex. Children’s Hosp., 446 S.W.3d 355, 361 (Tex. 2014). A trial court

abuses its discretion if the court acts without reference to any guiding rules or

principles, that is, if the act is arbitrary or unreasonable. Low v. Henry, 221

S.W.3d 609, 614 (Tex. 2007); Cire v. Cummings, 134 S.W.3d 835, 838–39 (Tex.

2004).

The rules of civil procedure allow for a trial court to impose sanctions for

discovery abuse in certain circumstances. See Tex. R. Civ. P. 215.1–215.3. Any

sanction that the trial court imposes must be just. TransAm. Nat. Gas Corp. v.

Powell, 811 S.W.2d 913, 917 (Tex. 1991) (orig. proceeding). For a sanction to

6 be just, a trial court must “consider the availability of less stringent sanctions and

whether such lesser sanctions would fully promote compliance.” Id.

Under this standard, a trial court “need not test the effectiveness of each

available lesser sanction by actually imposing the lesser sanction on the party

before issuing the death penalty; rather, the trial court must analyze the available

sanctions and offer a reasoned explanation as to the appropriateness of the

sanction imposed.” Cire, 134 S.W.3d at 840 (emphasis added). When a record

is devoid of any indication that a trial court considered a lesser sanction or when

the record only contains a conclusory statement that no lesser sanction would be

effective, we must reverse a death-penalty sanction. In re Estate of Perez-

Muzza, 446 S.W.3d 415, 425–26 (Tex. App.—San Antonio 2014, pet. denied);

see Spohn Hosp. v. Mayer, 104 S.W.3d 878, 882–83 (Tex. 2003) (explaining that

the record should “contain some explanation of the appropriateness of the

sanctions imposed” and stating that a death-penalty sanction may only be

imposed in the first instance when the facts of case are exceptional and the

sanction is “clearly justified”); Knoderer v. State Farm Lloyds, No. 06-13-00027-

CV, 2014 WL 4699136, at *11 (Tex. App.—Texarkana Sept. 19, 2014, no pet.)

(mem. op.) (“[A] trial court either must impose lesser sanctions first or must

clearly explain on the record why the case is an exceptional case where it is fully

apparent that no lesser sanctions could promote compliance.” (emphasis

added)); In re Medtronic, Inc., No. 10-14-00077-CV, 2014 WL 2159555, at *3

(Tex. App.—Waco May 22, 2014, orig. proceeding) (mem. op.) (“In all cases, the

7 record must reflect that the trial court considered the availability of appropriate

lesser sanctions and must contain an explanation of the appropriateness of the

sanction imposed.” (emphasis added)).

As explained above and as Tracy contends, the record does not contain

any explanation by the trial court why a lesser sanction would have been

ineffective or why the death-penalty sanctions were appropriate. On appeal, Matt

argues that the trial court imposed “strikes” against Tracy through its orders that

required her to comply with discovery but did not sanction her. He contends,

“The record . . . indicates that not only did the trial court consider lesser

sanctions, it twice ordered [Tracy] to comply with [Matt’s] discovery requests

without imposing significant sanctions.” Matt also argues that the law does not

require “special wording within the body of a sanctions order to make the order

valid. Rather [precedent requires] that the record reflect that the trial court

considered lesser sanctions.”

Concerning Matt’s argument that the trial court’s orders prior to the

sanctions order counted as “strikes” against Tracy, Texas courts have held that

“[t]hreatened, prospective, potential, or conditional sanctions do not constitute the

imposition of a lesser sanction.” CRSS Inc. v. Montanari, 902 S.W.2d 601, 612

(Tex. App.—Houston [1st Dist.] 1995, writ denied) (op. on reh’g) (emphasis in

original); see also Chrysler Corp. v. Blackmon, 841 S.W.2d 844, 850 (Tex. 1992)

(orig. proceeding) (“[W]e do not consider the conditional fine to be, as the

Garcias argue, an imposition of a required lesser sanction.”); Wang v. Rao, No.

8 13-96-00346-CV, 1998 WL 35277004, at *4 (Tex. App.—Corpus Christi Apr. 30,

1998, no pet.) (not designated for publication) (“A mere threat to sanction or

intent to sanction is not of itself a sanction.”)

More importantly, the precedent cited above along with numerous

persuasive cases mandate that before a trial court may order death-penalty

sanctions, the court must both consider lesser sanctions and provide a reasoned

explanation concerning the appropriateness of the greater sanction imposed.

See Cire, 134 S.W.3d at 840; Spohn Hosp., 104 S.W.3d at 882–83; see also

GTE Commc’ns Sys. Corp. v. Tanner, 856 S.W.2d 725, 729 (Tex. 1993) (orig.

proceeding) (faulting a trial court for not explaining why lesser sanctions would

not have been effective); In re Melcher, No. 14-16-00130-CV, 2017 WL 1103549,

at *4 (Tex. App.—Houston [14th Dist.] Mar. 23, 2017, orig. proceeding) (mem.

op.) (“Here, the order does not refer to any lesser sanctions or explain why lesser

sanctions are inappropriate in this case. The sanctions order is deficient in this

regard.” (emphasis added)); Young, 2016 WL 7339117, at *4 (“[T]he record must

show that the court analyzed available sanctions and offered a reasoned

explanation as to appropriateness of the sanction imposed.”); Primo v.

Rothenberg, Nos. 14-13-00794-CV, 14-13-00997-CV, 2015 WL 3799763, at *24

(Tex. App.—Houston [14th Dist.] June 18, 2015, pet. denied) (mem. op.) (“Even

when the record reflects intentional discovery abuse, as it does here, the trial

court is still required to explain that it considered lesser sanctions before

imposing sanctions precluding a party’s ability to present the merits of its

9 claims.”); Knoderer, 2014 WL 4699136, at *11 (“[A] trial court either must impose

lesser sanctions first or must clearly explain on the record why the case is an

exceptional case where it is fully apparent that no lesser sanctions could promote

compliance.”); Citibank, N.A. v. Estes, 385 S.W.3d 671, 676 (Tex. App.—

Houston [14th Dist.] 2012, no pet.) (“The absence of an explanation of how a trial

court determined to impose an especially severe sanction is inadequate.”).

The trial court did not comply with this mandate of explaining its decision to

impose death-penalty sanctions rather than lesser sanctions either in the hearing

leading to the sanctions or in the order imposing the sanctions. See Cire, 134

S.W.3d at 840. The order on the second motion for sanctions lists the instances

where Tracy failed to comply with the order on discovery; however, it does not

indicate why initial death-penalty sanctions were warranted. The record is clear

that the trial court did not impose sanctions before imposing the death-penalty

sanctions. Thus, based on the authority discussed above, we conclude that the

trial court abused its discretion by granting death-penalty sanctions without

offering a reasoned explanation for the appropriateness of those sanctions. See

Citibank, N.A., 385 S.W.3d at 677 (“The assessment of death penalty sanctions

in this case as an initial sanction, without explanation, is excessive.”). We

sustain Tracy’s second issue.3

3 We do not condone Tracy’s repeated failures to comply with the requirements of participating in discovery.

10 The record demonstrates that the trial court’s judgment and the default

prove-up hearing leading to the final divorce decree depended on the sanctions

order, in which the trial court granted a default judgment. The trial court took

judicial notice of the sanctions order in the decree, which the trial court signed

just six days after the sanctions order. The trial court held the default prove-up

hearing in lieu of a previously scheduled trial set for months later. Therefore, we

hold that because the trial court’s imposition of sanctions, including the granting

of a default judgment, was erroneous, the final decree of divorce must be

reversed. In light of this conclusion, we need not consider Tracy’s remaining

issues. See Tex. R. App. P. 47.1; Big Country Elec. Coop. v. Hill, No. 11-09-

00368-CV, 2011 WL 5307858, at *3 (Tex. App.—Eastland Nov. 3, 2011, no pet.)

(mem. op.).

Conclusion

Having sustained Tracy’s second issue, we conclude that the trial court

erred when it assessed death-penalty sanctions and entered a default judgment

against Tracy. Thus, we reverse the trial court’s final decree of divorce and

remand this case for further proceedings consistent with this opinion.

/s/ Terrie Livingston

TERRIE LIVINGSTON CHIEF JUSTICE

PANEL: LIVINGSTON, C.J.; GABRIEL and KERR, JJ.

DELIVERED: July 27, 2017