Opinion
05-22-00829-CV
05-08-2024
BALTASAR D. CRUZ, Appellant v. VICTOR HERNANDEZ AND GUILLERMO MARTINEZ, Appellee
On Appeal from the 44th Judicial District Court Dallas County, Texas Trial Court Cause No. DC-21-18209
Before Justices Reichek, Carlyle, and Miskel
MEMORANDUM OPINION
AMANDA L. REICHEK JUSTICE
Baltasar D. Cruz appeals the trial court's order awarding him $1,325 in fees and $41 in expenses for his services as a guardian ad litem. Asserting six issues, Cruz generally contends the trial court abused its discretion and applied incorrect criteria in determining the fees he was entitled to recover. We affirm the trial court's order.
Background
On December 10, 2010, Salvador and Jacquelyn Robledo, individually and on behalf of J.R., and Veronica Robledo, individually and on behalf of J.J. and C.J., filed suit against Victor Hernandez, Guillermo Martinez, and Old American County Mutual Insurance to recover for injuries sustained in a motor vehicle accident. A year and a half later, on May 29, 2012, the parties filed a Rule 11 agreement stating all claims asserted against the defendants had been settled. Hernandez filed an agreed motion for appointment of a guardian ad litem to represent the interests of the three minor children. The trial court granted the motion and appointed Cruz to represent all three. The order stated "[t]he Guardian Ad Litem shall file a report of Guardian Ad Litem in compliance with the form promulgated by this court."
Three years later, on June 4, 2015, Hernandez filed an agreed motion to abate the personal injury case until a separate suit against the underinsured motorist insurance carrier was resolved. The personal injury case was abated and no further action took place until the trial court scheduled a status conference for May 18, 2018. Cruz did not appear at the conference.
Approximately six weeks after the status conference, Hernandez and Martinez filed a motion to appoint a new guardian ad litem asserting that Cruz had been unresponsive to requests for updates. Following a hearing at which Cruz again did not appear, the trial court granted the motion and appointed Melodee Armstrong as the new guardian ad litem.
On May 29, 2019, two days before the prove-up hearing on the settlement agreement, Cruz filed an application for compensation pursuant to Rule 173 of the Texas Rules of Civil Procedure. In the application, Cruz noted the trial court's file did not appear to contain a motion to reinstate the case. He further stated he was never notified of any hearings following the abatement and was unaware until recently that he had been removed as guardian ad litem. Cruz requested $6,525 in fees and $41 in expenses. His billing records indicated that over $2,000 of his fees was for work performed in connection with the separate suit against the underinsured motorist insurance carrier.
At the hearing on Cruz's application, Hernandez's attorney, Michael Spears, opposed Cruz's request for compensation arguing that Cruz never met with the children and did nothing in the case to advance their interests. He stated Cruz did not meet with any of the adult plaintiffs until he attended the mediation in the underinsured motorist coverage case, which was more than three years after he was appointed as guardian ad litem. Spears asserted his office attempted to contact Cruz by phone and e-mail multiple times and received no response. According to Spears, the substitute ad litem did all the work Cruz was supposed to have done and completed her work in the case for roughly half the fees Cruz was seeking to recover. Spears stated the defendants did not wish to pay Cruz in addition to Armstrong because they felt he did no substantive work and Armstrong had to duplicate whatever work Cruz may have done. The trial court commented that much of the work reflected in Cruz's billing statements appeared to be $25 charges for "everything [he] touch[ed]." The court was concerned that Cruz failed to update the court on the case and was unaware for a long period of time that the settlement in the case had been finalized.
Cruz disputed the characterization of his work and stated he had no record of any attempts to contact his office to which he did not respond. He contended all of the work he performed was reasonable and necessary. Cruz conceded he had been served with the motion to replace him as guardian ad litem, but stated he had "overlooked" it. He noted the motion did not contain a signed certificate of conference.
On June 11, the trial court signed an order approving an award to Cruz of $1,325 in fees and $41 in expenses. The order stated that, of the 26.1 hours billed by Cruz, only 5.3 hours reflected "necessary services performed." One month later, the trial court signed an amended final judgment approving the settlement agreement reached by the parties. On Cruz's request, the judgment incorporated the ruling on his compensation. Armstrong was awarded $3,991.48 for her services as the substitute ad litem.
Cruz appealed the trial court's judgment to this Court. We reversed and remanded on the ground that the trial court conducted proceedings and rendered its final judgment after abating the case without signing an order of reinstatement. Cruz v. Hernandez, No. 05-19-00956-CV, 2021 WL 1588996, at *2 (Tex. App.-Dallas Apr. 23, 2021, no pet.). Because the case was not formally reinstated, all proceedings conducted after the point the case was abated, including Cruz's removal as guardian ad litem and the final judgment, were a nullity. Id.
On remand, the trial court reinstated the case, and the defendants filed a renewed motion to remove Cruz as guardian ad litem. At the hearing on the renewed motion, Spears stated Cruz failed to provide the court with an ad litem report as required, did not appear for a status conference, and was unresponsive to e-mail communications. Spears further stated that, although Cruz claimed not to have received various court filings and notices, those documents were filed and served on Cruz through the e-filing system at the same email address Cruz had been using consistently throughout the case. Cruz again defended the work he had done and said he was not aware of any attempts to contact him that had not been successful. After taking judicial notice of its file, the court granted the motion, relieved Cruz of his duties, and reappointed Armstrong as substitute guardian ad litem for the minor children. The court then severed Cruz's claim for compensation into this cause.
Cruz filed a second application for compensation, once again seeking $6,525 in fees and $41 in expenses for the ad litem work he performed prior to his appeal of the original fee award. In addition, Cruz sought to recover his fees for successfully prosecuting his appeal and for additional work he performed following remand of the case. In total, Cruz sought $28,846.34 in fees and expenses.
On July 22, 2022, the trial court once again awarded Cruz $1,325 in fees and $41 in expenses. In its order, the court stated it was declining to award Cruz any fees he incurred while the case was abated or for his attendance at court proceedings in cases other than the one in which he had been appointed guardian ad litem. The court further stated it would not award Cruz fees for actions he took that were unrelated to the suit in which he had been appointed or for his appeal of the prior fee award which was "pursued for his own interest and not that of his minor clients."
Analysis
I. Fees for Ad Litem Work
In his first three issues, Cruz challenges the trial court's determination of the amount of compensation he was entitled to recover for his services as guardian ad litem. Rule 173 of the Texas Rules of Civil Procedure authorizes the trial court to award an ad litem a reasonable fee for necessary services performed. Tex.R.Civ.P. 173.6(a). Payment of an ad litem fee is not required, however, and is not automatic. Id.; Magna Donnelly Corp. v. DeLeon, 267 S.W.3d 108, 113 (Tex. App.-San Antonio 2008, no pet.). We review the court's award of compensation to an ad litem for an abuse of discretion. Jocson v. Crabb, 196 S.W.3d 302, 305 (Tex. App.-Houston [1st Dist.] 2006, no pet.). A trial court abuses its discretion when it acts without reference to any guiding rules and principles. Garcia v. Martinez, 988 S.W.2d 219, 222 (Tex. 1999).
Although not presented as an issue in this appeal, Cruz spends a large portion of his brief discussing the trial court's October 2021 order removing him as guardian ad litem. Cruz contends the trial court abused its discretion in granting the defendants' motion to appoint a new ad litem because the motion (1) had previously been ruled a nullity by this Court, (2) did not contain a certificate of conference, and (3) was not supported by evidence. With respect to the first contention, the trial court's record shows the defendants renewed their motion to remove Cruz as guardian ad litem in September 2021, after the case was reinstated. A hearing was conducted on the renewed motion and, while the trial court's order references the June 2018 motion, it is clear the order is based on the motion to remove Cruz filed after the case was reinstated. As for Cruz's second contention, this Court has recognized that "in view of the fact that parties may freely file motions and clerks may freely set hearings, the local rule [requiring a certificate of conference] is purely procedural" and does not impact the trial court's authority to rule on the motion. Christopher v. Echevarria, No. 05-17-00800-CV, 2018 WL 3154400, at *1 (Tex. App.-Dallas June 28, 2018, no pet.) (mem. op.). The record shows Cruz filed a response opposing his removal as ad litem one month before the motion was heard. He presents no argument to explain how the absence of a certificate of conference was prejudicial to his ability to respond or resulted in an erroneous decision. Finally, Cruz's contention that there was no evidence to support the trial court's decision to remove him is equally unavailing. The trial court stated at the hearing that it was taking judicial notice of its file. In addition, at the hearing on the motion, Spears discussed at length Cruz's failure to perform any substantive work during the years he served as the guardian ad litem. See Banda v. Garcia, 955 S.W.2d 270, 272 (Tex. 1997) (unsworn statements of counsel at hearing constituted some evidence absent objection by opponent).
When a settlement has been proposed to resolve a minor's claim, the guardian ad litem's duties are limited to advising the court whether the settlement is in the minor's best interest. Tex.R.Civ.P. 173.4(c); Columbia Rio Grande Healthcare, L.P. v. De Leon, No. 13-09-00496-CV, 2011 WL 227669, *3 (Tex. App.-Corpus Christi Jan. 20, 2011, no pet.) (mem. op.). Due to the ad litem's limited role, not all litigation services are necessary or required. De Leon, 2011 WL 227669, at *3. An ad litem will not be compensated for unnecessary work. Jocson, 196 S.W.3d at 306. The burden of proof falls on the ad litem to establish his fees are reasonable and necessary. Id.
Cruz contends the trial court abused its discretion when it focused on whether the work he performed substantively advanced the position of the minors or was in the minors' best interest when it determined the amount of compensation he would recover. Cruz argues these considerations are not among the factors used to determine whether a fee is reasonable. Cruz relies on the Texas Supreme Court's opinion in Garcia v. Martinez which applied the Arthur Anderson factors to determine an ad litem's compensation. See Garcia, 988 S.W.2d at 222.
These factors include:
(1) the time and labor required, the novelty and difficulty of the questions involved, and the skill required to perform the legal service properly;
(2) the likelihood ... that the acceptance of the particular employment will preclude other employment by the lawyer;
(3) the fee customarily charged in the locality for similar legal services;
(4) the amount involved and the results obtained;
(5) the time limitations imposed by the client or by the circumstances;
(6) the nature and length of the professional relationship with the client;
(7) the experience, reputation, and ability of the lawyer or lawyers performing the services; and
(8) whether the fee is fixed or contingent on results obtained or uncertainty of collection before the legal services have been rendered.Id. (citing Arthur Anderson v. Perry Equip. Corp., 945 S.W.2d 812, 818 (Tex. 1997).
Rule 173 governing the appointment of guardians ad litem and their compensation was significantly revised in 2004. See Tex. R. Civ. P. 173 cmt. 1. The current rule limits the amount of compensation an ad litem can recover. See id., cmt. 7 ("Because the role of the guardian ad litem is limited in all but extraordinary situations . . . compensation, if any is sought, should ordinarily be limited."). "As the personal representative of a minor, a guardian ad litem is required to participate in the case only to the extent necessary to protect the minor's interest and should not duplicate the work performed by the plaintiff's attorney." Land Rover U.K., Ltd. v. Hinojosa, 210 S.W.3d 604, 607 (Tex. 2006). If the ad litem performs work beyond the scope of his role of protecting the minor's interest, such work is non-compensable. Id. Accordingly, whether the work performed advanced the position of the minor or was in the minor's best interest are proper considerations when determining whether the ad litem's work was necessary and, therefore, compensable. See id. Even using the traditional lodestar analysis, the trial court examines factors other than the Arthur Anderson factors when determining whether the amount of fees requested should be enhanced or reduced. Rohrmoos Venture v. UTSW DVA Healthcare, LLP, 578 S.W.3d 469, 500 (Tex. 2019); see also Iola Barker v. Hurst, 632 S.W.3d 175, 193 (Tex. App.-Houston [1st Dist.] 2021, no pet.) ("When determining an appropriate fee award, the trial court is entitled to examine the entire record and to view the matter in light of the amount in controversy, the nature of the case, and his or her personal experience as a lawyer or judge.").
In this case, Cruz's billing records show a significant amount of the fees he sought to recover was for work he claims he did in connection with the underinsured motorist insurance coverage case. Cruz was not appointed as guardian ad litem in that case and, therefore, cannot recover compensation for any of his work associated with it. See Ford Motor Co. v. Chacon, 370 S.W.3d 359, 362-63 (Tex. 2012); see also Land Rover, 210 S.W.3d at 609 (not all services that benefit minor are compensable).
The remaining fees sought by Cruz must be viewed in light of the record and evidence showing Cruz: (1) never met with his minor clients; (2) failed to meet with a parent or next friend of his minor clients until more than three years after he was appointed; (3) met with an adult plaintiff only in connection with a case in which he did not represent the children; (4) never filed a guardian ad litem report with the trial court as required by the order appointing him; (5) failed to respond to communications from opposing counsel; (6) was eventually removed as ad litem due to his failure to perform his duties; and (7) initially sought to recover roughly twice the amount of compensation as the substitute ad litem who successfully represented the children's interests through final settlement of the case. In addition, despite the fact the personal injury case was, for all practical purposes, resolved years earlier, Cruz sought to recover even more compensation following remand of the case. These additional fees include thousands of dollars for opposing his removal as ad litem for a second time. This work was clearly conducted solely for Cruz's own benefit and was outside the scope of his role as ad litem under Rule 173. See Tex. R. Civ. P. 173.4(c). Based on the foregoing, we conclude the trial court did not abuse its discretion in awarding Cruz only $1,325 in fees for his ad litem work. See Hurst, 632 S.W.3d at 193 (even if evidence of fees is uncontroverted, attendant circumstances may indicate claimed fees are unreasonable or incredible). We resolve Cruz's first three issues against him.
II. Appellate Fees
In his fourth, fifth, and sixth issues, Cruz contends the trial court erred in refusing to compensate him for successfully appealing the trial court's original judgment. Cruz argues Texas case law supports a guardian ad litem's right to recover fees on appeal. In support of this argument, Cruz cites DeSai v. Islas, 884 S.W.2d 204, 206 (Tex. App.-Eastland 1994, writ denied), Hirczy v. Hirczy, 838 S.W.2d 783, 787 (Tex. App.-Corpus Christi-Edinburg 1992, writ denied), and Smith v. Smith, 720 S.W.2d 586, 591 (Tex. App.-Houston [1st Dist.] 1986, no writ.). Cruz's reliance on these cases is misplaced.
All three cases cited by Cruz were decided before Rule 173 was revised to limit an ad litem's duties, liabilities, and compensation. More importantly, all three cases concern contingent awards by the trial court in the event the guardian ad litem was forced to defend the judgment on appeal. Cruz cites no case, and we have found none, in which an ad litem was allowed to recover fees for choosing to prosecute an appeal of a judgment solely for the purpose of challenging the amount of his compensation. Indeed, Texas case law such suggests such a recovery would be prohibited.
Once the conflict of interest between the minor and the parent or next friend has been resolved, a guardian ad litem is no longer necessary. Brownsville-Valley Reg'l Med. Ctr., Inc. v. Gamez, 894 S.W.2d 753, 756 (Tex. 1995). "[I]t is an abuse of discretion for a trial court to award an ad litem fees for services performed after the resolution of the conflict of interest which gave rise to the appointment." Id. at 754. Because an ad litem cannot recover fees under Rule 173 once his services to the minor are no longer necessary, it follows that an ad litem should not be allowed to recover fees under Rule 173 for pursuing an appeal solely in his own interests rather than those of the minor. See Ford Motor Co. v. Aguilar, No. 13-16-00290-CV, 2017 WL 541117, at *4 (Tex. App.-Corpus Christi-Edinburg Feb 9, 2017, no pet.) (mem. op.); Goodyear Dunlop Tires N. Am., Ltd. v. Gamez, 151 S.W.3d 574, 587 (Tex. App.-San Antonio 2004, no pet.); Holt Tex., Ltd. v. Hale, 144 S.W.3d 592, 598 (Tex. App.-San Antonio 2004, no pet.). In this case, Cruz not only pursued an appeal solely in his own interest, but also directly contrary to the interests of the minors he represented.
During the hearing on Cruz's original application for compensation the following exchange occurred:
The Court: Let me ask you this. When you appeal this order, you are going to challenge the Final Judgment in this court and the ad litem fee as this court having no authority to lift an abatement that was agreed to by the parties, to resolve this matter in essentially one fell swoop. Is that what I am hearing you argue?
Mr. Cruz: No, Your Honor. No.
The Court: Good.
Mr. Cruz: I'm simply arguing whether to grant the fees or not.
The Court: You have a challenge to your attorney's fees. It would be directly contrary to the interests of your minor children for you to try to
Mr. Cruz: I'm just pointing out there are certain procedural oddities in this case that made it - that made it particularly difficult for me to have known that anything was going on.
Rather than attempting to ensure the validity of the original judgment and requesting that his compensation award be severed into a separate cause, Cruz chose to challenge the entire judgment on appeal, thereby delaying significantly the recovery of damages by the plaintiffs, including the minors. We stated as much in our prior opinion in this case. See Cruz, 2021 WL 1588996, at *2 ("[W]e do not believe it is in the best interest of the parties or the courts to have proceedings continue for years without resolution - as in this case."). Cruz argues his appeal benefitted the minors because, if he had been allowed to resume his duties as ad litem on remand, he would have recommended that more of the settlement money be allocated to them. This argument is both hypothetical and irrelevant. The facts are that, in an effort to recover more compensation for himself, Cruz chose to appeal a judgment approved by both the substitute ad litem and trial court that awarded damages to the minor plaintiffs. We conclude the trial court did not abuse its discretion in refusing to award Cruz his appellate fees under those circumstances. See In re Glasser, 297 S.W.3d 369, 378 (Tex. App.-San Antonio 2009, no pet.). We resolve Cruz's last three issues against him.
In his reply brief, Cruz challenges the compensation award on the basis that it violates his constitutional right to due process and amounts to "involuntary servitude" or a "condition of peonage." A reply brief may not be used to raise new issues. Dallas Cnty. v. Gonzales, 183 S.W.3d 94, 104 (Tex. App.- Dallas 2006, pet. denied). Accordingly, those issues are not properly before us.
We affirm the trial court's order.
JUDGMENT
In accordance with this Court's opinion of this date, the order of the trial court is AFFIRMED.
It is ORDERED that appellee VICTOR HERNANDEZ AND GUILLERMO MARTINEZ recover their costs of this appeal from appellant BALTASAR D. CRUZ.