Opinion
14-21-00437-CV
05-19-2022
RAINER VON FALKENHORST III, Appellant v. ARTHUR KWOK; ERIKA LYNNSEY KWOK; QAI ASSET, INC.; RUSH GREEN ASSET, LIMITED PARTNERSHIP; REGAL REALTY INTERNATIONAL, L.P.; AND ERICKA J. THOMAS, Appellees
On Appeal from the 269th District Court Harris County, Texas Trial Court Cause No. 2021-34617
Panel consists of Justices Wise, Poissant, and Wilson.
MEMORANDUM OPINION
PER CURIAM
Appellant Rainer von Falkenhorst III, proceeding pro se, appeals the trial court's grant of summary judgment in favor of appellees regarding his petition for a bill of review, on the basis that the underlying lawsuit was untimely filed. After construing appellant's pro se brief liberally, we affirm the trial court's judgment.
The appellees listed above are derived from the trial court's signed judgment.
Although appellees Arthur Kwok; Erika Lynnsey Kwok; QAI Asset, Inc. (which has at times been referred to as Asset Inc. and Qai Asset, Inc. in the litigation and appeal); Rush Green Asset, Limited Partnership; Regal Realty International, LP; and Ericka J. Thomas appeared before the trial court, the only appellees who have appeared during this appeal are Arthur Kwok and QAI Asset, Inc. The attorney who represented all of the above-named appellees before the trial court is representing both appearing appellees during this appeal.
Background
This appeal is essentially about two cases: the lawsuit appellant originally filed in 2018 (the "Original Lawsuit"), and the proceeding appellant initiated with a petition for a bill of review in 2021, which continued into this appeal.
Although the appellate record paints an unclear picture of what the Original Lawsuit entailed, it concerned a commercial relationship between appellant and one or more of the appellees regarding services performed around August 10, 2010, on his real property located on Memorial Drive (the "Property") in Harris County. Soon thereafter, in September of 2010, appellant began a period of incarceration that ended in November 2019. On May 4, 2011, while appellant was incarcerated, a Substitute Trustee's Deed recorded in Harris County, reflects appellee QAI Asset, Inc. purchased the Property at a foreclosure sale. The Substitute Trustee's Deed indicates the sale took place on May 4, 2011, as a result of appellant's default on a contract associated with the August 2010 commercial relationship.
In December 2018, appellant filed the Original Lawsuit. Although the record does not contain pleadings from the Original Lawsuit, appellant's petition for a bill of review has represented, and appellees do not dispute, that appellant requested a lis pendens on the Property and advanced claims of Deceptive Trade Practices Act violations, breach of contract, fraud, and theft of personal items associated with the Property. As near as can be determined, appellants' claims in the Original Lawsuit all centered on his contentions that his commercial relationship with at least one appellee in August 2010 and the related Substitute Trustee's Deed were infected by fraud or other wrongful behavior. The Original Lawsuit was dismissed on June 20, 2019 on the basis that appellant had failed to prosecute it.
Almost two years later, on June 9, 2021, appellant filed a petition for a bill of review against appellees. Appellees filed a motion for summary judgment on July 2, 2021, requesting the trial court to "dispose of each cause of action stated in" appellant's petition because, among other reasons, the Original Lawsuit was untimely as to every cause of action it advanced. The motion asserted the statute of limitations for all of appellant's causes of action was not more than four years, and because appellant's causes of action accrued no later than May 4, 2011 when the Substitute Trustee's Deed was filed in public records, the Original Lawsuit, filed more than seven years later in December 2018, was untimely as to all claims. On July 30, 2021, the trial court granted the motion and denied appellant's petition for bill of review on the basis that, "as to each and every cause of action" in appellant's petition for a bill of review, the claims were untimely when the Original Lawsuit was filed. This appeal followed.
Appellant also named Micheal L. Fuqua and the company Fuqua & Associates PC as defendants in his petition for a bill of review, though there is no indication they ever appeared in the trial court and they have not appeared before this court in this appeal. But the trial court's order expressly resolved all claims plaintiff raised against those two parties, and even when appellant's brief is construed broadly, it does not contend the trial court improperly granted summary judgment as to claims against Micheal L. Fuqua and Fuqua & Associates PC due to their failure to appear before or expressly seek a judgment from the trial court.
Analysis
A trial court's grant of summary judgment is reviewed de novo, with all evidence reviewed in the light most favorable to the party that did not file the motion and with every reasonable inference given in the nonmovant's favor. See JLB Builders, L.L.C. v. Hernandez, 622 S.W.3d 860, 864 (Tex. 2021). As appellant is proceeding pro se, this court must construe his pleadings liberally, although it will not step out of its role of neutral adjudicator and into the role of advocate by developing arguments and support on his behalf. See Sorrow v. Harris Cnty. Sheriff, 622 S.W.3d 496, 501 (Tex. App.-Houston [14th Dist] 2021, pet. denied); Lundy v. Masson, 260 S.W.3d 482, 503 (Tex. App.-Houston [14th Dist.] 2008, pet. denied).
Appellant's petition for a bill of review directly attacked the trial court's dismissal of the Original Lawsuit. See Frost Nat'l Bank v. Fernandez, 315 S.W.3d 494, 504 (Tex. 2010) ("A bill of review is brought as a direct attack on a judgment that is no longer appealable or subject to a motion for new trial."). To have prevailed on his petition for a bill of review, appellant was required to plead and prove three elements: (1) he had a meritorious claim or a defense to an underlying judgment; (2) he was prevented from making either of those things by an official mistake or by the opposing party's fraud, accident, or wrongful act; and (3) the failure to make the claim or defense was unmixed with any fault or negligence on appellant's own part. Valdez v. Hollenbeck, 465 S.W.3d 217, 226 (Tex. 2015).
The trial court's judgment in 2021, which held the Original Lawsuit was untimely as to all claims, tacitly concluded appellant's petition for a bill of review failed because he could not prove the Original Lawsuit advanced a meritorious claim. Cf In re B.C., 52 S.W.3d 926, 930 (Tex. App.-Beaumont 2001, no pet.) (upholding the grant of a bill of review asserting a claim was at least partially barred due to a limitations defense); see also Tex. Civ. Prac. & Rem. Code Ann. §§ 16.003 (setting a two-year limitations period for claims of "conversion of personal property" and "taking or detaining the personal property of another"); 16.051 (setting a four-year limitations period for "[e]very action for which there is no express limitations period, except an action for the recovery of real property"); 16.054 (four-year limitations period for fraud); Tex. Bus. & Com. Code Ann. § 17.565 (two-year limitations period for DTPA violations); Ford v. Exxon Mobil Chem. Co., 235 S.W.3d 615, 617 (Tex. 2007) (per curiam) (four-year limitations period for setting aside a deed due to fraud). As near as can be determined, appellant's brief attempts to portray his claims as timely by arguing that the statute of limitations for at least some of the claims seeking the Property in the Original Lawsuit is either ten or twenty-five years, on the basis that they are claims to recover real property adversely possessed. See Tex. Civ. Prac. & Rem. Code Ann. §§ 16.026 (ten-year limitations period for claims to "recover real property held in peaceable and adverse possession by another who cultivates, uses, or enjoys the property"); 16.027 (twenty-five year limitations period for such claims that implicate a legal disability of the plaintiff). But because appellant's claims for the Property all attack the validity of the allegedly wrongful Substitute Trustee's Deed (whether by attacking his preceding commercial relationship or otherwise), those extended statutes of limitations cannot apply here. Rather, unless the Substitute Trustee's Deed can be shown to be void rather than merely voidable, a four-year statute of limitations applies. See Ford, 235 S.W.3d at 617-18 (acknowledging that a claim that a deed is fraudulent had to be brought within four years of the fraud being discoverable by reasonable diligence). Although appellant claims the alleged fraud underlying the deed itself renders the Substitute Trustee's Deed void, he is incorrect. See id. at 618 ("Deeds obtained by fraud are voidable rather than void, and remain effective until set aside."). Accordingly, appellant has failed to show a ten- or twenty-five-year statute of limitations associated with adverse possession applied to any claims made in the Original Lawsuit. See id. ("Texas law is well settled that once limitations has expired for setting aside a deed for fraud, that bar cannot be evaded by simply asserting the claim in equity.").
Appellant's brief asserts, however, that appellees' summary judgment motion did not address all of the claims he asserted. However, the motion does appear to have addressed all of the claims in appellant's June 9, 2021 petition for bill of review, and although appellant's brief asserts the incomplete nature of appellant's motion is based on the contents of a fifth amended petition filed June 24, 2021, the appellate record does not contain such a document from the trial court proceedings.
Since appellant indisputably filed the Original Lawsuit outside the limitations period for all of his claims, appellant can only show that his petition for a bill of review was incorrectly dismissed in 2021 if there was some basis for deeming his claims timely when the Original Lawsuit was filed. See, e.g., Underkofler v. Vanasek, 53 S.W.3d 343, 345 (Tex. 2001) (affirming a judgment that a tolling rule made claims timely filed); Comput. Assocs. Int'l, Inc. v. Altai, Inc., 918 S.W.2d 453, 461 (Tex. 1996) (acknowledging that the discovery rule can enable claims to be timely under Texas law even when they are filed outside the applicable limitations period).
Appellant first argues that his claims are timely due to the discovery rule. The discovery rule only applies to claims based on injuries that are "inherently undiscoverable," such that they are "unlikely to be discovered within the prescribed limitations period despite due diligence." Via Net v. TIG Ins. Co., 211 S.W.3d 310, 313 (Tex. 2006). Appellant's argument fails because the filing of the Substitute Trustee's Deed provided appellant with constructive notice that the Property had changed hands, whether wrongfully or otherwise. See Tex. Prop. Code Ann. § 13.002(1) ("[A]n instrument that is properly recorded in the proper county is[] notice to all persons of the existence of the instrument . . . ."); Cosgrove v. Cade, 468 S.W.3d 32, 38 (Tex. 2015) (discussing how the statute bars the discovery rule's applicability in cases disputing a recorded deed "as a matter of law"). Insofar as appellant's claims center on allegations that appellees appropriated or otherwise wrongfully possessed his personal property associated with the Property itself, any such injuries would be discoverable in association with the allegedly wrongful filing of the Substitute Trustee's Deed and appellants exercise of dominion over the Property. Cf. Burns v. Rochon, 190 S.W.3d 263, 272 (Tex. App.-Houston [1st Dist] 2006, no pet.) (holding injuries to personal property placed inside lawfully repossessed real property were inherently undiscoverable when there was "no evidence in the record to suggest that [the defendant] had as yet wrongfully interfered with [the plaintiff]'s rights as an owner"). As any resulting injuries to appellant were thereby discoverable, the discovery rule does not apply here.
Appellant has also more broadly asserted that tolling applies to his claims. Construing appellant's brief liberally, it appears his argument is based on the fact that he was incarcerated in 2010 until after he filed the Original Lawsuit, as well as his allegation that appellees fraudulently concealed some critical, tolling-implicating detail concerning the Substitute Trustee's Deed. Neither of those arguments justifies relief. Although imprisonment was once a statutory basis for tolling particular claims, the underlying statute was repealed in 1987. Dolenz v. Boundy, 197 S.W.3d 416, 420 (Tex. App.-Dallas 2006, pet. denied). Without that statute, there is no basis for holding appellant's imprisonment tolled any limitations period at all. See Lerma v. Pecorino, 822 S.W.2d 831, 832 (Tex. App.-Houston [1st Dist.] 1992, no writ) (holding imprisonment stopped tolling a limitations period beginning after the effective date of the statute's repeal); see also Tex. Civ. Prac. & Rem. Code. Ann. §§ 16.001 (listing multiple grounds for disability that could toll a limitations period for personal actions, none of which is imprisonment); 16.022 (listing multiple grounds for disability that could toll a limitations period for the recovery of real property, none of which is imprisonment). As for appellant's allegations of fraudulent concealment, even assuming that some fraud underlay the Substitute Trustee's Deed, appellant has not made any showing that he relied on the fraud after the deed was filed, thus making the doctrine inapplicable to his claims. See Markwardt v. Tex. Indus., Inc., 325 S.W.3d 876, 895 (Tex. App.-Houston [14th Dist] 2010, no pet.) (noting that a plaintiff must prove their "reasonable reliance" on the claimed fraud to prevail on a fraudulent concealment defense to a claim of limitations).
Appellant has also claimed that the Substitute Trustee's Deed provided no constructive notice that would begin a limitations period, as he asserts the document was not "properly recorded" for the purpose of providing notice, see Tex. Prop. Code Ann. § 13.002(1), but was fraudulently recorded and thus failed to provide notice. But appellant's argument is based on his contention that the Substitute Trustee's Deed's contents were fraudulent or otherwise wrongful, not that there was some deficiency in regard to the filing of the document. Because appellant has failed to show that the Substitute Trustee's Deed's recording was improper, his argument fails. See Cosgrove, 468 S.W.3d at 34 (noting that although a deed ostensibly had "[plainly obvious and material omissions," it was nevertheless "properly recorded" for limitations purposes).
Appellant has made a variety of other arguments asserting the Original Lawsuit was wrongly dismissed in 2019. But this court cannot discern how these arguments demonstrate the Original Lawsuit was timely as to any claim. And as noted above, whether the Original Lawsuit was timely determines whether appellant had a potentially meritorious petition for a bill of review incorrectly dismissed by the trial court. See Valdez, 465 S.W.3d at 226 (noting that a plaintiff can only prevail on a bill of review if he had a meritorious claim or defense to bring in an earlier lawsuit). Relatedly, although appellant has also alleged his constitutional rights were violated by the trial court's dismissal of his petition for a bill of review in 2021, his argument necessarily fails as it does not show how the Original Lawsuit contained any meritorious claims. To the extent appellant's brief contains any further arguments when construed liberally, appellant still fails to show he brought a timely claim in 2018, a prerequisite to showing he brought a meritorious petition for bill of review in 2021.
Liberally construing his brief, appellant alleges the following additional issues regarding the dismissal of the Original Lawsuit: (1) appellees had constructive notice of the Original Lawsuit independent of his ostensible failure to prosecute that lawsuit; (2) a set of defenses in Section 53.160(b) of the Texas Property Code objecting to the validity or enforceability of liens or related claims were applicable to the Original Lawsuit; (3) appellees failed to perfect a lien or otherwise comply with requirements that affect the Substitute Trustee's Deed's or any associated lien's validity; (4) the doctrine of adverse possession implicates the merits of the Original Lawsuit; (5) appellant's constitutional rights were violated in association with the Original Lawsuit's dismissal or by some unspecified conduct of appellees; and (6) the Original Lawsuit's dismissal was in some way caused by the trial court's partiality.
Analysis
To summarize, in order for appellant to be entitled to relief by bill of review, he had to prove he brought a timely claim in the Original Lawsuit. As the record demonstrates, appellant did not do so, thus, his petition for a bill of review was correctly dismissed. Accordingly, we affirm the trial court's judgment.