Opinion
No. 01-04-00621-CV
Opinion issued July 14, 2005.
On Appeal from the 270th District Court, Harris County, Texas, Trial Court Cause No. 2002-44758.
Panel consists of Justices NUCHIA, KEYES, and BLAND.
MEMORANDUM OPINION
Appellants, The Estate of William H. Simmons and Mary Simmons Hensley, Individually and as Trustee of the W.H. Simmons Trust ("the Simmonses"), appeal the summary judgment ordering that the Simmonses take nothing by their suit against appellees, Compania Financiera Libano, S.A. and Armando Fong Najarro ("Compania"). We affirm.
BACKGROUND
In 1991, Compania sued the Simmonses and others, alleging fraudulent transfer of certain property interests, in a suit styled Compania Financiera Libano, S.A. and Armando Fong Najarro v. William H. Simmons, et al., in the 270th District Court of Harris County, cause number 1991-474143. In August 1996, the parties entered into a Rule 11 agreement in which the Simmonses would transfer certain property interests and deliver certain shares of stock to Compania; Compania would recover $25,000 from the Simmonses; the Simmonses would take nothing against Compania; an agreed judgment against the Simmonses for $25,000 would be entered; and the parties would execute mutual releases of their claims. On September 12, 1996, the trial court rendered an agreed judgment ordering that Compania recover $25,000 from the Simmonses and that Compania take nothing from other defendants. The judgment recites "that all relief not expressly granted . . . is denied." The judgment references a settlement agreement, but does not attach the agreement or incorporate it. The Simmonses did not execute the documents transferring property interests or stocks to Compania, and the parties did not execute a mutual release.
In November 1996, Compania sued the Simmonses for breach of the Rule 11 agreement in cause number 1996-56962, Compania Financiera Libano, S.A. and Armando Fong Najarro v. William H. Simmons, Mary Simmons Hensley, Individually and as Trustee, and the W.H. Simmons Trust, in the 270th District Court of Harris County. The Simmonses filed a general denial and did not counterclaim to enforce Compania's obligation to sign the mutual release. The trial court rendered summary judgment in Compania's favor on its breach-of-contract claim, tried Compania's other issues, and rendered final judgment in Compania's favor. On April 21, 1998, the trial court signed a judgment nunc pro tunc ordering that Mary Hensley, as trustee of the Simmons Trust, execute attached instruments transferring certain property to Compania, that the Simmonses recover nothing from Compania, and that Compania recover attorney's fees from the Simmonses.
The Simmonses appealed the judgment, contending that the Rule 11 agreement was integrated into the agreed judgment and that Compania's lawsuit was a collateral attack on the judgment. The Fourteenth Court of Appeals reversed the trial court's judgment and rendered judgment for the Simmonses, holding that Compania's lawsuit was an impermissible collateral attack on the agreed judgment in cause number 1991-47143. The Texas Supreme Court reversed the court of appeals, concluding that, although res judicata bars parties from bringing a second suit on matters actually litigated and on matters that could have been litigated in the first suit, that doctrine did not bar Compania's suit. The court reasoned that, at the time the judgment in cause number 1991-47143 was rendered, the Simmonses had not yet breached their settlement agreement. Therefore, Compania could not have sued in the first suit for breach of the settlement agreement, and the Mother Hubbard clause in the judgment could not dispose of claims that did not exist. The supreme court affirmed the trial court's judgment.
See Simmons v. Compania Financiara Libano, 14 S.W.3d 338, 341 (Tex.App.-Houston [14th Dist.] 2000), rev'd, 53 S.W.3d 365 (Tex. 2001).
Compania Financiara Libano, S.A. v. Simmons, 53 S.W.3d 365, 366-67 (Tex. 2001).
Id. at 367.
Id.
When the Simmonses continued to refuse to transfer the property, Compania filed a motion for contempt in the trial court in April 2002. The Simmonses countered by filing a motion for judgment nunc pro tunc in cause number 1996-56962, asking the trial court to add an order of specific performance by the parties to execute mutual releases. The trial court denied the motion, and the Simmonses filed a petition for writ of mandamus in the First Court of Appeals, requesting that the trial court be ordered to sign the judgment nunc pro tunc. This Court, in an unpublished opinion in cause number 01-02-00755-CV, determined that the Simmonses had an adequate remedy at law and that the omission from the judgment was not a clerical error. Therefore, the Simmonses were not entitled to extraordinary relief.
See In re Simmons, No. 01-02-00755-CV, 2002 WL 1869997, *1 (Tex.App.-Houston [1st Dist.] August 15, 2002 (orig. proceeding) (not designated for publication).
In August 2002, the Simmonses sued Compania for specific performance of the Rule 11 agreement. Compania answered and filed a motion for summary judgment, asserting the statute of limitations, res judicata, collateral estoppel, and failure of consideration as defenses. The trial court granted Compania's motion without specifying the grounds and rendered judgment in Compania's favor on March 3, 2004.
DISCUSSION
In their sole issue, the Simmonses contend that the trial court erred in rendering summary judgment on Compania's affirmative defenses. The Simmonses argue that Compania's breach occurred post-judgment and, therefore, gave rise to a new cause of action. We follow the well-known standard of review for rule 166a(c) summary judgments. See Tex. R. Civ. P. 166a(c); Randall's Food Mkts., Inc. v. Johnson, 891 S.W.2d 640, 644 (Tex. 1995); Lawson v. B Four Corp., 888 S.W.2d 31, 33-34 (Tex.App.-Houston [1st Dist.] 1994, writ denied). We will affirm the summary judgment if any theory advanced in the motion for summary judgment and preserved on appeal is meritorious. See Cincinnati Life Ins. Co. v. Cates, 927 S.W.2d 623, 626 (Tex. 1996).
Res judicata precludes relitigation of claims that have been finally adjudicated or that arise out of the same subject matter and that could have been litigated in the prior action. Barr v. Resolution Trust Corp., 837 S.W.2d 627, 628 (Tex. 1992). This doctrine bars not only those matters actually litigated, but causes of action or defenses that arise out of the same subject matter and that could have been litigated in the first suit. Id. at 630. To establish res judicata, a party must prove the following elements: (1) a prior final judgment on the merits by a court of competent jurisdiction, (2) identity of parties or those in privity with them, and (3) a second action based on the same claims as were raised or could have been raised in the first action. Amstadt v. U.S. Brass Corp., 919 S.W.2d 644, 652 (Tex. 1996).
The final judgment in cause number 1996-56962 established the first two elements of res judicata. The issue, then, is whether the Simmonses breach-of-contract claim could have been raised in the 1996 lawsuit. The Simmonses argue that "it would have made no sense" for them to complain in the 1996 lawsuit of Compania's failure to execute the mutual release because, while Compania was seeking damages for breach of the Rule 11 agreement, the Simmonses took the position that any agreements not specifically incorporated into the judgment in that case were superseded by the judgment. They cite no authority to support this argument.
The 1996 lawsuit and the present lawsuit arose out of the same Rule 11 agreement. The Simmonses could have raised their breach-of-contract claim in the 1996 lawsuit, but did not. Even if that claim was inconsistent with their defense, they could have asserted it as an alternative pleading. We hold that Compania has established the third element of res judicata — that the claim in the second action could have been raised in the first. Accordingly, the trial court did not err in rendering summary judgment in favor of Compania.
CONCLUSION
Having determined that the trial court did not err in rendering summary judgment on the basis of res judicata, we need not consider the other grounds argued in Compania's motion for summary judgment. We overrule the Simmonses' sole issue and affirm the judgment of the trial court.