Opinion
14-24-00071-CV
06-27-2024
DAVID CALDWELL, II, Appellant v. ANN MARIE QUAID, Appellee
On Appeal from the 505th District Court Fort Bend County, Texas Trial Court Cause No. 21-DCV-288304
Panel Consists of Chief Justice Christopher and Justices Zimmerer and Wilson.
ORDER
PER CURIAM
Before the court is appellant's emergency motion to stay enforcement of the trial court's divorce decree filed April 12, 2024 and approve appellant's request to supersede the judgment without any payment. Appellant supplemented the motion on April 18, 2024, and appellee has filed a response to the motions.
This appeal arises out of a final decree of divorce signed November 3, 2023. In large part, the decree awarded a variety of property rights between the previously married parties to this appeal, allotted rights to funds in various accounts individually or jointly owned by the parties, and awarded appellee $643,605.43 "[f]or the purpose of a just and right division made [by the] decree." In findings of fact and conclusions of law signed January 26, 2024, the trial court went on to say that it "finds there is a valid waste claim of the community estate in the amount of $320,937.31 that constitutes funds spen[t] by [appellant] to the detriment of the community estate," essentially finding appellant committed constructive fraud regarding that spending. Cf. Zieba v. Martin, 928 S.W.2d 782, 789 (Tex. App.- Houston [14th Dist.] 1996 no writ) (discussing how constructive fraud involves, among other aspects of wrongdoing, "dispos[ing] of the other spouse's one-half interest in community property without the other's knowledge or consent").
The divorce decree contains language about the alleged $320,931.31 constructive fraud that is not fully consistent with the findings of fact and conclusions of law. It describes "[c]onstructive fraud against the estate in the amount of $320,931.31" as "sole and separate property" of appellant, rather than appellee, and the decree further states that the trial court was "reconstitut[ing] the estate in this amount and award[ing] this amount to appellant." But nowhere in appellant's motion papers does he point to any basis for the trial court potentially finding appellee liable in some way for constructive fraud, and he does not contest that the trial court ultimately found appellant committed constructive fraud. Accordingly, we assume the $320,937.31 reflects wrongdoing by appellant. Cf. George Joseph Assets, LLC v. Chenevert, 557 S.W.3d 755, 765 (Tex. App.-Houston [14th Dist.] 2018, pet. denied) (acknowledging that appellate courts are normally to "indulge every reasonable inference that supports" a trial court's underlying findings). For simplicity, we will refer to this as "constructive fraud" rather than "waste" for the remainder of this order.
On January 12, 2024, appellant filed a supersedeas bond that essentially was a request to supersede the trial court's judgment without any payment until the appellate process was concluded. Essentially, the bond contended that because the underlying decree was, in the filing's telling, "about property division" rather than damages, there was no need to provide any payment to supersede the trial court's judgment. However, during a hearing on February 22, 2023, the trial court announced that it was setting the supersedeas bond amount at $320,937.31, as it noted that was "the amount of the [constructive fraud] that the [trial court] determined in the final decree of divorce." The trial court subsequently signed an order on the same day that, among other things, set "bond to stay the judgment in this matter at $320,937.31." This supersedeas review proceeding followed pursuant to Texas Rule of Appellate Procedure 24.4. We temporarily stayed enforcement of the trial court's judgment on April 15, 2024 pending resolution of the review proceeding. See Tex. R. App. P. 24.4(c).
Discussion
A. Applicable Standards
A judgment debtor may supersede the judgment by: (1) filing with the trial court clerk a written agreement with the judgment creditor for suspending enforcement of the judgment; (2) filing with the trial court clerk a good and sufficient bond; (3) making a deposit with the trial court clerk in lieu of a bond; or (4) providing alternate security ordered by the court. Tex.R.App.P. 24.1(a). The amount of security necessary to supersede a money judgment must equal the sum of: (1) the amount of compensatory damages awarded in the judgment; (2) interest for the estimated duration of the appeal; and (3) costs awarded in the judgment. Tex.R.App.P. 24.2(a)(1); Tex. Civ. Prac. & Rem. Code Ann. § 52.006(a). The amount of that security may not, however, exceed the lesser of: (1) fifty percent of the judgment debtor's net worth or (2) $25 million. Tex.R.App.P. 24.2(a)(1)(A), (B); Tex. Civ. Prac. & Rem. Code Ann. § 52.006(b)(1), (2).
As an initial matter, we conclude that two arguments made by appellant's motions are moot and need not be analyzed, namely his contention that the trial court erred by failing to treat his bond as effective as of its January 12th filing and his averment that the trial court erroneously required an increased supersedeas bond through an oral ruling and a docket entry. Respectively: (1) appellant has not pointed to any concrete harm the allegedly belatedly effective bond caused him before this court's temporary stay of April 15th, while this court's temporary stay thereafter apparently prevented any such harm; and (2) the trial court contemporaneously issued a written and signed order that itself required an increased supersedeas bond of $320,937.31.
Appellant argues, as the primary thrust of his motions, that the trial court abused its discretion when it concluded that the amount required to supersede the divorce decree was the amount assessed against appellant for constructive fraud he allegedly committed against the community estate. Essentially, appellant points to Rule 24.2(a)(1)'s requirement that superseding a judgment for recovery of money requires a bond, deposit, or security equaling "the sum of compensatory damages awarded in the judgment, interest for the estimated duration of the appeal, and costs awarded in the judgment." See Tex. R. App. P. 24.2(a)(1). In appellant's telling, the amount for constructive fraud allegedly committed by appellant does not constitute "compensatory damages" for purposes of Rule 24.2(a)(1). Consequently, accordingly to appellant, that amount cannot be used to calculate the bond required for superseding the divorce decree, and the trial court erred by doing otherwise.
We conclude the trial court did not abuse its discretion by using the constructive fraud amount to determine the amount necessary to supersede the divorce decree. Constructive fraud, by its nature, entailed appellant "wrongfully deplet[ing] the community estate of assets without [appellee]'s knowledge or consent." Boothe v. Boothe, 681 S.W.3d 916, 924 (Tex. App.-Houston [14th Dist.] 2023, no pet.). Although appellant tries to analogize the remedy for such wrongdoing to the remedies of attorney's fees and disgorgement that, as the Texas Supreme Court has noted, are not compensatory damages for supersedeas purposes,we find the analogy is not fitting as the remedy the trial court carried out for constructive fraud (i.e., awarding appellee a correspondingly greater share of the community estate) was meant to remedy the harm appellant allegedly inflicted on appellee's rights. See id. (acknowledging constructive fraud entails wrongful depletion of community estate assets). We accordingly hold that an award of community estate assets corresponding to constructive fraud allegedly committed by a wrongdoing spouse can constitute "compensatory damages" for supersedeas purposes, and the trial court did not abuse its discretion in setting the required bond amount accordingly. Cf. In re Nalle Plastics Family Ltd. P'ship, 406 S.W.3d 168, 173 (Tex. 2013) (distinguishing attorney's fees, which are not compensatory damages, from "compensation owed for an underlying harm"); see also Schlueter v. Schlueter, 975 S.W.2d 584, 588 (Tex. 1998) (quoting Belz v. Belz, 667 S.W.2d 240, 247 (Tex. App.-Dallas 1984, writ ref'd n.r.e.)) (acknowledging that asserting "fraud on the community [occurred] is a means to an end," such as to "compensate the wronged spouse for his or her lost interest in the community estate").
In re Longview Energy Co., 464 S.W.3d 353, 361 (Tex. 2015) (holding monetary award for disgorgement does not constitute compensatory damages); In re Nalle Plastics Family Ltd. P'ship, 406 S.W.3d 168, 173 (Tex. 2013) (holding attorney's fees are not compensatory damages).
Appellant has also attacked the validity of the trial court's judgment in a garnishment proceeding under a different case number, which apparently seeks to enforce the judgment signed in the proceeding underlying this appeal. We conclude it is unnecessary to consider at this time whether appellant is in any way entitled to relief regarding the garnishment proceeding, because even assuming he is, such relief is not available in this proceeding under Rule 24.4. That rule only authorizes this court to presently review the following five matters: "(1) the sufficiency or excessiveness of the amount of security . . .; (2) the sureties on any bond; (3) the type of security; (4) the determination whether to permit suspension of enforcement and (5) the trial court's exercise of discretion under Rule 24.3(a)." Tex.R.App.P. 24.4(a)(1)-(5); see also AME & FE Invs., Ltd. v. NEC Networks, LLC, 582 S.W.3d 294, 297 (Tex. App.-San Antonio 2017) (op. on motion) (describing Rule 24.4 as authorizing "limited supersedeas review" solely over the five above-enumerated matters). To the extent appellant seeks any relief specific to the garnishment proceeding, such relief is not available in the context of this supersedeas review proceeding. We reach the essentially the same conclusion for essentially the same reasons regarding other forms of relief appellant's motions request that go beyond challenging supersedeas-focused actions, specifically his requests to: (1) strike trial court orders that ostensibly find the underlying divorce decree to award either compensatory damages or interest tied to compensatory damages or court-ordered costs; and (2) hold the trial court lacked authority to award contingent appellate attorney's fees.
Finally, we understand appellant to ask for several additional forms of relief regarding the trial court's supersedeas-focused actions, namely: (1) holding the trial court erred by sua sponte raising a challenge to appellant's supersedeas bond; and (2) holding the trial court erred by allowing appellee to testify as to whether appellant should be required to provide a larger supersedeas bond to supersede the judgment. Those requests for relief, however, are not accompanied by arguments or authorities to support appellant's requests. Accordingly, we conclude that appellant has waived such requests due to his failure to adequately brief them. See Katy Springs & Mfg., Inc. v. Favalora, 476 S.W.3d 579, 605 (Tex. App.-Houston [14th Dist.] 2015, pet. denied).
Conclusion
For the reasons we discussed above, we hold that the trial court acted within its discretion when it required appellant to provide a bond in the amount of $320,937.31 in order to supersede the appealed from divorce decree, and appellant is otherwise not entitled to relief in association with that action. We accordingly deny appellant's motions in full, and we hereby lift the temporary stay this court ordered on April 15, 2024. Appellant must file a bond in the amount of $320,937.31 with the trial court in order to supersede the trial court's divorce decree. Although the temporary stay ordered by this court on April 15, 2024 is no longer in effect, pursuant to Texas Rule of Appellate Procedure 24.4(e), enforcement of the underlying judgment is suspended for twenty days from the date of this order.