In re Carroll Glenn Scott (Tex.App.- Austin, Jun. 29, 2007)

In re Carroll Glenn Scott (Tex.App.- Austin, Jun. 29, 2007)(Law)(dismissal)
MOTION OR WRIT DENIED: Opinion by Chief Justice Law
Before Chief Justice Law, Justices Puryear and Henson)

In re Carroll Glenn Scott
Appeal from 146th District Court of Bell County

ORIGINAL PROCEEDING FROM BELL COUNTY

M E M O R A N D U M O P I N I O N

The motion for leave to file petition for writ of mandamus is dismissed. The petition for writ of mandamus is denied. See Tex. R. App. P. 52.8(a).
__________________________________________
W. Kenneth Law, Chief Justice
Before Chief Justice Law, Justices Puryear and Henson
Filed: June 29, 2007

Bexar Metro Water Dist. v. City of San Antonio (Tex.App.- Austin, Jun. 29, 2007)

Bexar Metropolitan Water Dist. v. City of San Antonio (Tex.App.- Austin, June 29, 2007)(Henson)(UDJA, jurisdiction, authority)

AFFIRMED: Opinion by Justice Henson
Before Chief Justice Law, Justices Puryear and Henson)

Bexar Metropolitan Water District, Juan and Luann Rivara, and Joseph and Dawn Fiorino v. City of San Antonio, acting by and through the San Antonio Water System
Appeal from 200th District Court of Travis County

FROM THE DISTRICT COURT OF TRAVIS COUNTY, 200TH JUDICIAL DISTRICT
NO. D-1-GV-06-000053, HONORABLE SCOTT H. JENKINS, JUDGE PRESIDING

OPINION BY JUSTICE HENSON

Appellants Bexar Metropolitan Water District (BexarMet), Juan and Luann Rivara, and Joseph and Dawn Fiorino appeal a summary judgment in favor of the San Antonio Water System (SAWS). SAWS initially filed suit seeking a declaration that BexarMet is prohibited from expanding its political boundaries and service area past certain geographical limits described in BexarMet's enabling statute, as amended by Senate Bill 1494. (1) The Rivaras and the Fiorinos, individuals living outside BexarMet's original political boundaries but within BexarMet's service area, intervened in the lawsuit. BexarMet and the intervenors argued that the district court did not have jurisdiction over SAWS's claim. BexarMet and the intervenors also argued that even if the trial court did have jurisdiction, SB 1494 is unconstitutional under the conservation amendment to the Texas Constitution, found in article XVI, § 59. This provision requires the legislature to provide advance notice of any bill that will expand the boundaries of a water district or alter the district's taxing authority. Alternatively, BexarMet argued that if SB 1494 is constitutional, it does not limit BexarMet's authority to expand its service area or political boundaries.

The trial court granted summary judgment in favor of SAWS, rendering judgment that SB 1494 did not violate article XVI, § 59 of the Texas Constitution. Further, the trial court found that SB 1494 limits BexarMet's service territory and political boundaries to certain areas. BexarMet and the intervenors appeal that judgment.

Because we conclude (1) that SAWS has standing to bring this suit, (2) that the enactment of SB 1494 did not violate the Texas Constitution, and (3) that SB 1494 limits BexarMet's service territory and political boundaries, we affirm the district court's judgment.

BACKGROUND

The present suit represents yet another installment in a seemingly endless litigation battle between BexarMet and other water districts in the surrounding area regarding the scope of BexarMet's service area. BexarMet is a political subdivision created by special act (the BexarMet Act) (2) in 1945 under article XVI, § 59 of the Texas Constitution. The BexarMet Act, as it was written in 1945, included a metes and bounds description of the political boundaries of the district. BexarMet Act, § 5, 1945 Tex. Gen. Laws at 494. Sections 6 and 6a authorized two annexation procedures by which BexarMet could expand its political boundaries, although BexarMet never took advantage of either of these procedures. Id. §§ 6, 6a, 1945 Tex. Gen. Laws at 496-97. BexarMet's political boundaries were commonly understood to coincide with the area within the 1945 city limits of San Antonio.

Texas water districts, including BexarMet, have the authority to exercise any powers within "the terms of the statutes which authorized their creation, and they can exercise no authority that has not been clearly granted by the legislature." Tri-City Fresh Water Supply Dist. No. 2 of Harris County v. Mann, 142 S.W.2d 945, 948 (Tex. 1940). The statutes creating Texas water districts "envision an orderly development of the State's natural resources . . . through the formation of definite districts with geographical boundaries where waters of the State will be conserved through primary utilization within the district." Harris County Water Control & Improvement Dist. No. 58 v. City of Houston, 357 S.W.2d 789, 796 (Tex. Civ. App.--Houston 1962, writ ref'd n.r.e.). When BexarMet was created in 1945, it was given the authority of a "governmental agency, a body politic and corporate, and a municipal corporation." BexarMet Act, § 2, 1945 Tex. Gen. Laws at 492.

BexarMet provided water service strictly to southern Bexar County until the 1990s, when it began expanding its service territory to include portions of Atascosa, Comal, and Medina counties, as well as additional portions of Bexar County. BexarMet accomplished this expansion by acquiring certificates of convenience and necessity (CCNs) from the Texas Commission on Environmental Quality (TCEQ) (3) authorizing the provision of retail water utility services. While BexarMet expanded its service area through CCNs, its political boundaries did not change. The Texas Water Code allows the service area of a water district to expand beyond its political boundaries. See Tex. Water Code Ann. § 49.215(d) (West 2000) ("A district shall not be required to hold a certificate of convenience and necessity as a precondition for providing retail water or sewer service to any customer or service area, notwithstanding the fact that such customer or service area may be located either within or outside the boundaries of the district . . . .").

In 1996, BexarMet's provision of water service to customers outside its political boundaries became the subject of a federal voting-rights lawsuit. See Rios v. Bexar Metro. Water Dist., No. SA-96-CA-335 (W.D. Tex. Apr. 22, 1996). Rolando Rios challenged BexarMet's method of electing at-large board members, claiming that the method diluted minority voting rights because residents of BexarMet's political territory who were not BexarMet customers were able to vote in the elections, while BexarMet customers living outside BexarMet's political territory were not. The parties settled and submitted a proposed consent decree. The court adopted the consent decree and ordered that BexarMet's political boundaries must coincide with its retail water utility service areas as determined by the CCNs.

In 2003, the Texas legislature, with BexarMet's support, (4) amended the BexarMet Act by passing SB 1494. One of the changes made by SB 1494 was the addition of § 5A, which states:

(a) The District's boundaries for purposes of the exercise of its powers and duties is [sic] defined in Section 5 of this Act.

(b) In conformity with the court's judgment dated April 22, 1996, in Cause No. SA 96CA0335, Rios v. Bexar Metropolitan Water District et al., in the United States District Court, Western District of Texas, and for the purpose of the exercise of its current retail water utility services, the District's boundaries shall include the territory defined in all or applicable portions of census tracts or property situated within any area certificated by the Texas Commission on Environmental Quality to the District on the date of passage of the Act adding this section pursuant to Certificates of Convenience and Necessity Nos. 10675, 12759, and 12760.
SB 1494, § 3, sec. 5A, 2003 Tex. Gen. Laws at 1596.

As noted above, § 5 of the BexarMet Act contains a metes and bounds description of BexarMet's political boundaries, commonly understood to coincide with the 1945 city limits of San Antonio. See BexarMet Act, § 5, 1945 Tex. Gen. Laws at 494.

SB 1494 also repealed §§ 6 and 6a of the BexarMet Act, the two unused provisions that allowed BexarMet to expand its territory through annexation. SB 1494, § 4, 2003 Tex. Gen. Laws at 1596. While SB 1494 included two grandfathering provisions that would allow any annexation procedures that were underway by a certain date to continue, no proceedings were underway by the relevant date to trigger the grandfathering provisions. See id. § 5, 2003 Tex. Gen. Laws at 1596.

Since SB 1494 was enacted, BexarMet and SAWS have sought to obtain CCNs for some of the same areas, which are located outside the boundaries in SB 1494. SAWS filed this suit challenging BexarMet's authority to apply for additional CCNs and TCEQ's authority to process the applications. BexarMet challenged the district court's jurisdiction on several grounds. The district court denied the plea to the jurisdiction and ruled on the merits of SAWS's claim, declaring that (1) SB 1494 does not violate the Texas Constitution; (2) BexarMet cannot provide services outside its statutory boundaries; (3) BexarMet's statutory boundaries are limited to the 1945 city limits of San Antonio plus the geographic area covered by CCN numbers 10675, 12759, and 12760, as they existed on June 18, 2003; and (4) TCEQ has no authority to grant new or amended CCNs to BexarMet for territory beyond the statutory boundaries. BexarMet and the intervenors appeal this judgment. (5)

DISCUSSION

BexarMet raises three issues on appeal, asserting (1) that the district court lacked jurisdiction over SAWS's claim, (2) that SB 1494 is void as unconstitutional, and (3) that even if SB 1494 is constitutional, it does not limit the authority of BexarMet to expand its current service area. Two of these issues have largely been resolved by prior decisions of this Court in similar litigation over BexarMet's service areas. The jurisdictional issue was addressed in Bexar Metropolitan Water District v. City of Bulverde, 156 S.W.3d 79, 86-89 (Tex. App.--Austin 2004, pet. denied) (referred to herein as Bulverde I). Whether SB 1494 limits BexarMet's ability to expand was recently examined by this Court in Bexar Metropolitan Water District v. City of Bulverde, No. 03-06-00447-CV (Tex. App.--Austin June 27, 2007, no pet. h.) (referred to herein as Bulverde II).

Jurisdiction

BexarMet argues that the trial court lacked jurisdiction over this case on three separate grounds. First, BexarMet contends that SAWS, as a mere competitor of BexarMet, lacked standing to pursue this action. Second, BexarMet argues that § 49.066 of the Texas Water Code bars SAWS's claims. Third, BexarMet claims that SAWS failed to establish standing under the federal voting-rights act to bring this action.

Whether a trial court has subject-matter jurisdiction is a question of law that we review de novo. Texas Natural Res. Conservation Comm'n v. IT-Davy, 74 S.W.3d 849, 855 (Tex. 2002). We consider only the pleadings and evidence relevant to the question of jurisdiction and do not look to the merits of the case. County of Cameron v. Brown, 80 S.W.3d 549, 555 (Tex. 2002). The plaintiff has the burden of alleging facts that affirmatively demonstrate that the trial court has jurisdiction to hear the case. Texas Dep't of Parks & Wildlife v. Miranda, 133 S.W.3d 217, 226 (Tex. 2004).

BexarMet argues that SAWS lacks standing to bring this suit, based on the proposition that a competitor does not have standing to challenge a competing corporation's actions. See, e.g., English v. Landa Motor Lines, 166 S.W.2d 721, 723 (Tex. Civ. App.--Austin 1942, writ ref'd w.o.m.). However, this Court has already resolved this issue in Bulverde I. See 156 S.W.3d at 88. In Bulverde I, this Court held that an "affected person" has standing to bring suit challenging a governmental authority's actions if the entity's "actions are void, as opposed to voidable." Id. (citing City of Irving v. Callaway, 363 S.W.2d 832, 834 (Tex. Civ. App.--Dallas 1962, writ ref'd n.r.e.)). SAWS sought a declaration that BexarMet is acting beyond its statutory powers as set forth in SB 1494. "If a water district acts beyond its statutory powers, its actions are void." Id. Therefore, SAWS has standing to bring this suit if it is an "affected person." This Court held in Bulverde I that an entity is considered an affected person if it is "seeking to provide water-utility services in the same area" as the governmental entity whose actions are being challenged. Id. Because SAWS alleged that BexarMet's actions are void and because SAWS, in seeking to provide water-utility services in the same area as BexarMet, is an affected person, SAWS has standing to bring this suit for declaratory judgment.

Bulverde I also informs us in considering and rejecting BexarMet's claim that § 49.066(d) of the Texas Water Code prevents SAWS from bringing this suit. Subsection 49.066(d) states that "no suit may be instituted in any court of this state contesting . . . the validity of the creation and boundaries of a district created under this code." Tex. Water Code Ann. § 49.066(d) (West 2000). The exception to this rule is that such a suit may be "brought by the State of Texas through the attorney general." Id. § 49.066(e). In Bulverde I, this Court held that "[r]equesting a declaration regarding the location of a district's boundaries and the district's authority to provide service and expand its boundaries is not the same as challenging the validity of those boundaries. Such determinations are not prohibited by section 49.066." 156 S.W.3d at 88. Because SAWS's suit challenging BexarMet's authority to expand its boundaries falls within this category of determinations that are not prohibited by § 49.066 of the water code, we conclude that the trial court was not barred by the water code from reviewing SAWS's claim.

BexarMet's argument that SAWS does not have standing under the federal voting-rights act is also without merit. SAWS has not asserted a claim under the voting-rights act in this litigation. While the Rios litigation was based on the voting-rights act, SAWS's claim in this case centers around the statutory construction of the BexarMet Act, which was amended as a result of Rios. SAWS is not required to establish standing under the voting-rights act because it has not presented a claim under that statute.

Because we conclude that the trial court had jurisdiction over SAWS's claim, we overrule BexarMet's first issue.

Constitutionality

BexarMet argues that SB 1494 is unconstitutional under article XVI, § 59 of the Texas Constitution. (6)

We review the trial court's summary judgment de novo. Valence Operating Co. v. Dorsett, 164 S.W.3d 656, 661 (Tex. 2005). When both parties file motions for summary judgment, we determine all presented questions and render judgment. SAS Inst., Inc. v. Breitenfeld, 167 S.W.3d 840, 841 (Tex. 2005). In order to prevail, a summary-judgment movant must prove that there is no genuine issue of material fact. Id.

In a constitutional challenge, "the courts should uphold a statute as valid unless it is clearly unconstitutional." Koy v. Schneider, 221 S.W. 880, 888 (Tex. 1920). Furthermore, "we must, if possible, construe statutes to avoid constitutional infirmities." Nootsie, Ltd. v. Williamson County Appraisal Dist., 925 S.W.2d 659, 662 (Tex. 1996).

The Texas Constitution contains specific notice requirements for the "introduction of any bill amending a law creating or governing a particular conservation and reclamation district if such bill (1) adds additional land to the district [or] (2) alters the taxing authority of the district." Tex. Const. art. XVI, § 59(d). Notice of the introduction of such a bill must be published in a newspaper of general circulation, and a copy of both the notice and bill must be delivered to the governor, among other requirements. Id. (7) All parties agree that these requirements were not met with respect to SB 1494.

BexarMet, now that SB 1494 has proven to be unfavorable to its interests, challenges the bill on constitutional grounds--despite having been an active proponent of SB 1494 during the legislative process. BexarMet argues that SB 1494 is void because it was enacted in violation of article XVI, § 59. SAWS contends that SB 1494 is not subject to the constitutional notice provisions because the bill did not "add additional land to the district" or "alter the taxing authority of the district."

Did SB 1494 Add Additional Land to the District?

The language of both the Rios judgment and SB 1494 suggests that SB 1494 was merely designed to reconcile the language of the BexarMet Act with the political boundaries set as a result of the Rios litigation. The Rios consent decree explicitly states that "the District's CCN areas served are hereby being made the Political Boundaries of the District." Section 5A of the BexarMet Act, as amended by § 3 of SB 1494, describes BexarMet's political boundaries, noting that this boundary description is "[i]n conformity with the court's judgment dated April 22, 1996, in Cause No. SA96CA0335, Rios v. Bexar Metropolitan Water District et al., in the United States District Court, Western District of Texas." SB 1494, § 3, sec. 5A, 2003 Tex. Gen. Laws at 1596.

Between the issuance of the Rios judgment and the enactment of SB 1494, BexarMet added additional land to its service area through the use of CCNs. The geographical area included in these CCNs became part of BexarMet's political boundaries pursuant to the Rios consent decree. (8) Because the Rios decree effectively expanded BexarMet's political territory prior to the passage of SB 1494, the bill could not have been the vehicle by which land was added to BexarMet's political territory. There was no land included in BexarMet's political boundaries after the passage of SB 1494 that was not within such boundaries immediately prior to the passage of SB 1494. As a result, SB 1494 was not subject to the notice requirements in article XVI, § 59 of the Texas Constitution for bills that "add additional land to the district."

The legislative history surrounding the passage of SB 1494 supports the view that BexarMet's political boundaries were redrawn when the Rios judgment was issued, rather than when SB 1494 was passed. Chuck Bailey, a legislative witness for BexarMet, testified before the Senate Natural Resources Committee on April 29, 2003, that SB 1494 was "basically a cleanup bill." Hearings on Tex. S.B. 1494 Before the Senate Comm. on Natural Res., 78th Leg., R.S. 2 (April 29, 2003) (statement of Chuck Bailey). Bailey also testified before the House Natural Resources Committee that SB 1494 brought BexarMet's boundaries "up to what they really are right now." Hearings on Tex. S.B. 1494 Before the House Comm. on Natural Res., 78th Leg., R.S. 1 (May 21, 2003) (statement of Chuck Bailey).

BexarMet argues that the Rios court could not have added territory to BexarMet's political boundaries because a federal court has no power under the voting-rights act to force a district to increase its boundaries. See Burton v. City of Belle Glade, 966 F. Supp. 1178, 1185-86 (S.D. Fla. 1997). However, the Rios judgment did not serve as the type of forced annexation discussed in Burton. (9) The Rios judgment, to which BexarMet consented, merely required BexarMet's political boundaries to match its service area. BexarMet was free to limit its service area to its political boundaries at the time, the area coinciding with the 1945 city limits of San Antonio. However, because BexarMet chose to continue providing service to areas outside those limits, the Rios court required BexarMet's political boundaries to be expanded to include such areas.

Furthermore, BexarMet may not use the state courts for a collateral attack on the Rios judgment. The full faith and credit clause of the United States Constitution (10) requires that federal court orders be enforced by Texas courts. Keene Corp. v. Caldwell, 840 S.W.2d 715, 720 (Tex. App.--Houston [14th Dist.] 1992, no pet). The Supreme Court has explained that "where the judgment or decree of the Federal court determines a right under a Federal statute, that decision is 'final until reversed in an appellate court, or modified or set aside in the court of its rendition.'" Stoll v. Gottlieb, 305 U.S. 165, 170 (1938) (quoting Deposit Bank v. Frankfort, 191 U.S. 499, 520 (1903)). This principle also extends to federal consent decrees. See National R.R. Passenger Corp. v. Pennsylvania Pub. Util. Comm'n, 342 F.3d 242, 259 (3d Cir. 2003) (holding that a federal consent decree is a final federal-court judgment that may not be collaterally attacked by a state court). To the extent that BexarMet argues that the Rios order, to which it consented, could not lawfully cause BexarMet's political boundaries to expand, it makes an impermissible collateral attack on a federal judgment in state court.

The doctrine of quasi-estoppel further prevents BexarMet from arguing that the Rios order did not serve to add additional land to BexarMet's political territory. Not only did BexarMet consent to the decree, but it also reaped the benefits of the Rios order by extending its political boundaries along with its service area in the years between the Rios order and SB 1494. Quasi-estoppel precludes a party from asserting a position in litigation, to another's disadvantage, that is inconsistent with a position from which that party previously benefitted. Lopez v. Munoz, Hockema & Reed, L.L.P., 22 S.W.3d 857, 864 (Tex. 2000). A party that benefits from a position that it has taken in a consent decree is similarly estopped from later asserting an inconsistent position. See New Hampshire v. Maine, 532 U.S. 742, 755 (2001). BexarMet, after consenting to the Rios judgment and enlarging its political boundaries as a result, may not now assert that the Rios judgment had no effect on BexarMet's political boundaries.

Did SB 1494 Alter the Taxing Authority of the District?

Like the addition of land to BexarMet's political territory, the expansion of BexarMet's taxing authority was a natural consequence of the Rios litigation. Had BexarMet chosen, post-Rios, to forego the provision of water services to the areas covered by the CCNs, its taxing authority would not have changed. However, because BexarMet continued providing water service to the areas covered by the CCNs and because the Rios consent decree required that such areas be included in BexarMet's political territory, BexarMet's taxing authority automatically extended to those areas.

Section 11 of the BexarMet Act authorizes BexarMet to levy, assess, and collect taxes "upon a favorable majority vote of the qualified property taxpaying electors voting at an election held for the purpose." BexarMet Act, § 11, 1945 Tex. Gen. Laws at 499. While the Rios judgment, as noted in a 2006 clarifying order, "did not alter, amend or in any manner extend the taxing authority of BexarMet" because "[o]nly the Texas Legislature has the authority" to do so, the Rios judgment did require that residents of BexarMet's service areas be afforded equal voting rights with those living inside BexarMet's pre-Rios political boundaries, pursuant to § 2 of the federal voting-rights act. The Texas Legislature, through § 11 of the BexarMet Act, gave BexarMet taxing authority over voters in the district, a group that necessarily included all residents of BexarMet's service territory after Rios. The effect of § 11 is that BexarMet's taxing authority is tied to the ability to vote. The Rios judgment may not have specifically altered BexarMet's taxing authority, but it created a situation in which taxing authority was automatically extended pursuant to § 11 of the BexarMet Act. BexarMet itself concedes that residents of its political territory are necessarily subject to taxing authority, stating in its motion for partial summary judgment, "The political boundaries of a district are those areas . . . where the residents can vote in district elections [and] are subject to the district's taxing authority . . . ." When BexarMet's political boundaries were expanded as a result of Rios, the expansion of its taxing authority followed. Because BexarMet's taxing authority was altered prior to the enactment of SB 1494 and there was no further change in BexarMet's taxing authority as a result of SB 1494, the constitutional notice requirements for bills that "alter the taxing authority of the district" were not triggered.

We conclude that SB 1494 did not add additional land to BexarMet's political territory or alter its taxing authority. As a result, SB 1494 was not subject to the notice provisions of article XVI, § 59 of the Texas Constitution. We overrule BexarMet's second issue.

BexarMet's Authority to Expand

BexarMet argues that if SB 1494 is constitutional, it does not limit BexarMet's authority to expand its service area or political boundaries. The trial court granted summary judgment in favor of SAWS, declaring that § 3 of SB 1494, in adding § 5A to the BexarMet Act, limited BexarMet's service territory and political boundaries to the 1945 city limits of San Antonio plus the geographic areas covered by CCN numbers 10675, 12759, and 12760 as of the enactment of SB 1494. Consistent with the holding of Bulverde II, we conclude that BexarMet's service territory and political boundaries are limited by SB 1494.

The declarations requested by the parties in this case rest on a matter of statutory construction. We review matters of statutory construction de novo. City of San Antonio v. City of Boerne, 111 S.W.3d 22, 25 (Tex. 2003). In construing a statute, our objective is to determine and give effect to the legislature's intent. State v. Gonzalez, 82 S.W.3d 322, 327 (Tex. 2002). "If a statute's meaning is unambiguous, we generally interpret the statute according to its plain meaning." Id. In determining legislative intent, we look at the entire act as a whole, rather than isolated portions. Id.

Prior to SB 1494, the BexarMet Act stated that BexarMet had the power, "[t]hrough every practical and legal means to control and regulate and to coordinate the control and regulation of the waters of the watershed of the San Antonio River and tributaries in the District and the storm and flood and underground waters of the District." BexarMet Act, § 3(a), 1945 Tex. Gen. Laws at 492. SB 1494 amended this language to give BexarMet the power, "[t]hrough every practical and legal means to develop, transport, deliver, distribute, store and treat water for use within the District, including the storm and flood waters within the District." SB 1494, § 2, sec. 3(a), 2003 Tex. Gen. Laws at 1594 (emphases added). As we noted in Bulverde I, "Some water-district enabling acts provide that water districts may sell or distribute water only within their boundaries. Other enabling acts allow a water district to distribute or sell water within or without the district's boundaries." 156 S.W.3d at 83 (citations omitted).

In a 1947 opinion, the Texas Attorney General concluded that a water district was not authorized to sell water outside its boundaries if its enabling statute used language limiting the scope of its authority to areas within the district. Op. Tex. Att'y Gen. No. V-319 (1947). In other words, "the statutes do not authorize [a] District to roam at large throughout the State and distribute water wherever it wishes without regard to limitations placed on it by statute." Harris County Water Control & Improvement Dist. No. 58, 357 S.W.2d at 795. Furthermore, we must presume that the legislature would not perform a meaningless or useless act, which means that the inclusion of the word "within" in BexarMet's enabling statute must be viewed as significant. See Webb County Appraisal Dist. v. New Laredo Hotel, Inc., 792 S.W.2d 952, 954 (Tex. 1990); see also Tex. Gov't Code Ann. § 311.021 (West 2005). In light of the legislature's use of the phrase "within the District," rather than "within or without the District," a phrase that the legislature has seen fit to include in the enabling statutes of other water districts, we conclude that SB 1494 was intended to limit BexarMet's political boundaries and service area to the geographical area described in § 5A of the BexarMet Act, as amended by SB 1494.

As this Court noted in Bulverde II, the legislative history of SB 1494 supports this conclusion. The introduced version of SB 1494 authorized BexarMet "to develop, transport, deliver, distribute, store and treat water including the storm and flood waters within or without the District . . . ." Tex. S.B. 1494, 78th Leg., R.S. (2003) (introduced version) (emphasis added). This language was amended, however, to "for use within the District," rather than "within or without the District."

BexarMet argues that the Texas Water Code authorizes BexarMet to expand its service area, even after the enactment of SB 1494. Section 49.211 of the water code authorizes a water district to "purchase, construct, acquire, own, operate . . . or extend inside and outside its boundaries any and all land, works, improvements, facilities, plants, equipment, and appliances necessary to accomplish the purposes of its creation or the purposes authorized by this code or any other law." Tex. Water Code Ann. § 49.211(b) (West Supp. 2006) (emphasis added). Similarly, § 49.215 of the water code authorizes a district to "purchase, construct, acquire, own, operate, repair, improve, or extend all works, improvements, facilities, plants, equipment, and appliances necessary to provide any services or facilities authorized to be provided by the district to areas contiguous to or in the vicinity of the district." Id. § 49.215(a) (West 2000) (emphasis added). BexarMet's position is that these statutes authorize BexarMet to continue serving areas outside of its boundaries, despite the language of SB 1494. In keeping with our decision in Bulverde II, we disagree.

Section 49.002 of the water code states that the provisions of chapter 49, including the provisions on which BexarMet relies, apply only "to the extent that the provisions of this chapter do not directly conflict with a provision in any other chapter of this code or any Act creating or affecting a special law district." Id. § 49.002(a) (West 2000). As amended by SB 1494, the BexarMet Act, which qualifies as an act creating a special law district, directly conflicts with §§ 49.215 and 49.211 of the water code. BexarMet argues that these provisions do not conflict, claiming that SB 1494 merely defines BexarMet's political boundaries and adds territory that was not included in the original statute. This argument ignores the language added to the BexarMet Act by SB 1494 that restricts BexarMet to delivering and distributing water "within" the district, as discussed above. This restriction creates a direct conflict between the BexarMet Act and §§ 49.215 and 49.211 of the water code, which authorize the provision of water services outside a district's political boundaries. As a result, BexarMet may not take advantage of these provisions in order to provide water service outside of its political boundaries.

As we stated in Bulverde II, further evidence that SB 1494 was intended to restrict BexarMet's political boundaries and service area can be found in the fact that SB 1494 eliminated §§ 6 and 6a of the BexarMet Act, which provided procedures for BexarMet to acquire additional territory through annexation. SB 1494, § 4, 2003 Tex. Gen. Laws at 1596. BexarMet argues that these provisions were deleted merely because they were redundant and unnecessary. However, SB 1494 included grandfathering provisions to allow any annexation procedures that were underway under § 6 or 6a by June 18, 2003 to continue. (11) Id. § 5, 2003 Tex. Gen. Laws at 1596. Had §§ 6 and 6a truly been redundant and unnecessary, there would be no need to include these grandfathering provisions. As noted above, we must presume that the legislature would not perform a meaningless or useless act. See Webb County Appraisal Dist., 792 S.W.2d at 954; see also Tex. Gov't Code Ann. § 311.021. The repeal of BexarMet's annexation procedures and the inclusion of grandfathering provisions point to the conclusion that BexarMet's political boundaries and service area are meant to be restricted by SB 1494.

In light of the legislature's restriction of BexarMet's water service to areas "within the District," the legislative history indicating that the phrase "within and without" was considered and subsequently abandoned, and the repeal of the only procedures for expansion available under the BexarMet Act, we conclude, as we did in Bulverde II, that BexarMet's political boundaries and service area are restricted to the geographic area described in § 5A of the BexarMet Act, as amended by § 3 of SB 1494. If BexarMet wishes to expand its boundaries in the future, it will have to address such matters with the legislature. The statute as it stands does not allow for expansion. We overrule BexarMet's third issue.

CONCLUSION

Because we conclude that the trial court had jurisdiction over SAWS's claim, that SB 1494 is not void as unconstitutional, and that BexarMet is limited to the service territory and political boundaries described in § 5A of its enabling statute, we affirm the trial court's judgment.
__________________________________________
Diane Henson, Justice
Before Chief Justice Law, Justices Puryear and Henson
Affirmed
Filed: June 29, 2007

1. Act of June 18, 2003, 78th Leg., R.S., ch. 375, 2003 Tex. Gen. Laws 1593 (SB 1494).
2. Act of May 1, 1945, 49th Leg., R.S., ch. 306, 1945 Tex. Gen. Laws 491.
3. For convenience, references to actions taken by TCEQ will also encompass actions taken by its predecessor, the Texas Natural Resource Conservation Commission.
4. Chuck Bailey, an attorney representing BexarMet, testified before the House Natural Resources Committee regarding SB 1494, stating, "I have worked with the San Antonio Water System and the San Antonio River Authority, and with the GBRA, and I think we are all in agreement on this." Hearings on Tex. S.B. 1494 Before the House Comm. On Natural Res., 78th Leg., R.S. 1 (May 21, 2003) (statement of Chuck Bailey). The committee chairman also noted for the record that "Nancy Milleda wants to be shown 'for' the bill. She's also with Bexar Metropolitan Water District." Id. at 2 (statement of Chairman Puente).
5. TCEQ did not file an appeal.
6. As a threshold matter, SAWS argues that BexarMet does not have standing to challenge the constitutionality of SB 1494 because BexarMet was an active proponent of the legislation. SAWS points to Barshop v. Medina County Underground Water Conservation District, 925 S.W.2d 618, 628 (Tex. 1996), in which the court stated that "active involvement in the legislative process evidences the sufficiency of the notice." Barshop does not support this argument. The court in Barshop held that a party's involvement in the legislative process was evidence that published notice was sufficiently informative; it did not address whether a proponent of legislation is later precluded from bringing a constitutional challenge due to lack of notice. But regardless of whether BexarMet's legislative activities qualify as constructive notice of SB 1494, there is no evidence that the intervenors actively participated in the legislative process. As a result, the intervenors have standing, and we will address the claims presented.
7. The full text of article XVI, § 59(d) states:
No law creating a conservation and reclamation district shall be passed unless notice of the intention to introduce such a bill setting forth the general substance of the contemplated law shall have been published at least thirty (30) days and not more than ninety (90) days prior to the introduction thereof in a newspaper or newspapers having general circulation in the county or counties in which said district or any part thereof is or will be located and by delivering a copy of such notice and such bill to the Governor who shall submit such notice and bill to the Texas Water Commission, or its successor, which shall file its recommendation as to such bill with the Governor, Lieutenant Governor and Speaker of the House of Representatives within thirty (30) days from date notice was received by the Texas Water Commission. Such notice and copy of bill shall also be given of the introduction of any bill amending a law creating or governing a particular conservation and reclamation district if such bill (1) adds additional land to the district, (2) alters the taxing authority of the district, (3) alters the authority of the district with respect to the issuance of bonds, or (4) alters the qualifications or terms of office of the members of the governing body of the district.
Tex. Const. art. XVI, § 59(d).
8. BexarMet argues that there is no evidence that its political territory expanded along with its service area when CCNs were granted or amended post-Rios but prior to the enactment of SB 1494. However, BexarMet would have had to wholly disregard the Rios judgment in order for its political territory not to expand along with its service area during this time period. We presume that BexarMet does not intend to make an argument that requires it to have disregarded a federal-court order.
9. On appeal, the trial court's judgment in Burton was reversed in part and affirmed in part, and the court noted that while forced annexation was an inappropriate remedy based on the facts of the case, it was not suggesting that "a federal court would never have the power to order annexation." Burton v. City of Bell Glade, 178 F.3d 1175, 1200 (11th Cir. 1999).
10. U.S. Const. art. IV, § 1.
11. BexarMet did not trigger either of these grandfathering provisions.

Raul Garcia v. Comm'n for Lawyer Discipline (Tex.App.- Austin, Jun. 29, 2007)

Raul Garcia vs. Commission for Lawyer Discipline (Tex.App.- Austin, Jun. 29, 2007)(Pemberton)(attorney conduct, fee-splitting, UPL, practicing law under trade name)

AFFIRMED: Opinion by Justice Pemberton
Before Chief Justice Law, Justices Pemberton and Waldrop

Raul Garcia v. Commission for Lawyer Discipline
Appeal from 261st District Court of Travis County

FROM THE DISTRICT COURT OF TRAVIS COUNTY, 261ST JUDICIAL DISTRICT
NO. GN302550, HONORABLE MARK D. DAVIDSON, JUDGE PRESIDING

MEMORANDUM OPINION BY JUSTICE PEMBERTON

This disciplinary action was brought by the Commission for Lawyer Discipline against Raul Garcia, a Texas-licensed attorney, for violations of rules 5.04(a), 5.04(b), 5.05(b), and 7.01(a) of the Texas Disciplinary Rules of Professional Conduct. On cross-motions for summary judgment, the district court granted summary judgment for the Commission as to rules 5.04(a), 5.05(b), and 7.01(a), and for Garcia as to rule 5.04(b). Garcia appeals the district court's judgment partially granting the Commission summary judgment against him and partially denying his summary judgment motions. We affirm the district court's judgment.

BACKGROUND

At relevant times, Garcia was employed by Cristo Vive, Christian Social Services, Inc. Cristo Vive is a nonprofit organization that, beginning in the late 1980s, provided services that have included assisting individuals with immigration-related legal matters, translation work, and social-service referrals. It is undisputed that some of these activities come within the statutory definition of the practice of law. See Tex. Gov't Code Ann. § 81.101(a) (West 2005). It is also undisputed that Cristo Vive has charged fees for these legal services ranging from $250 to $450, depending on the nature of service provided, served between 3,400 and 5,400 clients annually during the 1999-2001 tax years, and collected fees ranging from approximately $230,000 to $619,000 annually during that period.

Cristo Vive was previously the target of a proceeding initiated by the Unauthorized Practice of Law Committee (UPLC). See id. §§ 81.103-.104 (West 2005). Cristo Vive ultimately entered into a consent decree with the UPLC under which Cristo Vive "and its agents, officers, directors, servants, employees, successors and assigns" were enjoined from engaging in a range of activities related to immigration legal services, (1) subject to the following limitation on that prohibition:

except to the extent it is legally permitted to do so by 8 C.F.R. § [292.2] (2) and except to the extent it performs any such acts and conduct under the direction, supervision and control of a member of the State Bar of Texas.

Federal regulation permits non-profit organizations meeting certain criteria to obtain recognition or accreditation from the Board of Immigration Appeals permitting them to designate a representative to practice before the Board or INS. 8 C.F.R. § 292.2. Criteria for recognition include "ha[ving] at its disposal adequate knowledge, information and experience" and "mak[ing] only nominal charges . . . for persons given assistance." Id. § 292.2(a). The Commission has acknowledged that "[i]f Cristo Vive and its non-lawyer employees were recognized/accredited," state unauthorized practice of law (UPL) limitations "would yield to this federal law." However, it is undisputed that Cristo Vive has never succeeded in obtaining the required status.

In the aftermath of the consent decree, Cristo Vive, through its board of directors, and Garcia executed an employment contract whereby Garcia agreed to serve as the entity's "IN-HOUSE STAFF ATTORNEY . . . to supervise, direct and control all legal services offered to the community by Cristo Vive." It is undisputed that Cristo Vive and Garcia crafted the contract language and the structure of their relationship with the intent of coming within the second exception of the consent decree; i.e., Cristo Vive's acts and conduct otherwise constituting UPL would be "perform[ed] . . . under the direction, supervision and control of a member of the State Bar of Texas"--Garcia. Garcia accepted the position on June 26, 2001.

Thereafter, Garcia provided legal services to Cristo Vive's clients. Garcia worked full-time in this capacity for Cristo Vive and did not otherwise practice law other than occasional pro bono work through Volunteer Legal Services. (3) It is undisputed that although Cristo Vive charges fees varying with the services provided to each client, Garcia received a salary of approximately $50,000 per year that was not tied to the type of services he provided or the number of clients he counseled.

In June 2003, the Commission filed a disciplinary proceeding against Garcia alleging violations of the following provisions of the Texas Disciplinary Rules of Professional Conduct:

5.04(a) (fee-splitting with a non-lawyer);
5.04(b) (forming a partnership with a non-lawyer);
5.05(b) (assisting a person who is not a member of the state bar in committing UPL);
7.01(a) (practicing in private practice under a trade name).

The Commission subsequently sought partial summary judgment that Garcia had violated each of these rules. Garcia filed a response to the motion and separate cross-motions for traditional and "no evidence" summary judgment regarding each of the alleged rule violations. The district court granted the motions of both the Commission and Garcia in part and denied them in part. It rendered judgment that Garcia had violated rules 5.04(a), 5.05(b), and 7.01(a) but had not formed a partnership with a non-lawyer in violation of rule 5.05(b). The court further adjudged that the proper discipline for Garcia's violations was a public reprimand with an award of costs. This appeal ensued.

ANALYSIS

Garcia appeals the district court's judgment that he violated rules 5.04(a), 5.05(b) and 7.01(a). The Commission does not appeal the district court's judgment for Garcia regarding rule 5.04(b).
Standard of review

We review the district court's summary judgment de novo. Valence Operating Co. v. Dorsett, 164 S.W.3d 656, 661 (Tex. 2005); Provident Life & Accident Ins. Co. v. Knott, 128 S.W.3d 211, 215 (Tex. 2003). When reviewing a summary judgment, we take as true all evidence favorable to the non-movant, and we indulge every reasonable inference and resolve any doubts in the non-movant's favor. Valence Operating Co., 164 S.W.3d at 661; Knott, 128 S.W.3d at 215. Summary judgment is proper when there are no disputed issues of material fact and the movant is entitled to judgment as a matter of law. Tex. R. Civ. P. 166a(c); Shell Oil Co. v. Khan, 138 S.W.3d 288, 291 n.4 (Tex. 2004) (citing Knott, 128 S.W.3d at 215-16).

When, as here, both parties move for summary judgment on overlapping grounds and the district court grants one motion and denies the other, we ordinarily review the summary-judgment evidence presented by both sides, determine all questions presented, and render the judgment that the district court should have rendered. Texas Workers' Comp. Comm'n v. Patient Advocates of Tex., 136 S.W.3d 643, 648 (Tex. 2004). (4)

Rule 5.05(b): Assisting UPL

Rule 5.05(b) provides that a lawyer shall not "assist a person who is not a member of the bar in the unauthorized practice of law." Tex. Disciplinary R. Prof'l Conduct 5.05(b), reprinted in Tex. Gov't Code Ann., tit. 2, subtit. G app. A (West 2005) (Tex. State Bar R. art. X, § 9). This prohibition against assisting UPL, as well as the underlying ban on UPL itself, is rooted in a "perceived need to protect individuals and the public from the mistakes of the untrained and the schemes of the unscrupulous, who are not subject to the judicially imposed disciplinary standards of competence, responsibility, and accountability." Tex. Disciplinary R. Prof'l Conduct 5.05 cmt. 1. (5)

The Commission's complaint that Garcia assisted in UPL is predicated on the UPL of Cristo Vive. Cristo Vive's alleged UPL, in turn, is predicated on the acts of Garcia in providing legal services in the name of Cristo Vive to its customers, which is imputed to Cristo Vive as Garcia's principal. It is undisputed that the services Garcia provided to third parties as an attorney for Cristo Vive included those constituting the practice of law. See Tex. Gov't Code Ann. § 81.101(a) (6); see also Unauthorized Practice of Law Comm. v. Cortez, 692 S.W.2d 47, 50 (Tex. 1985) (holding that advising client as to whether to file immigration form constitutes practice of law). To date, Texas law remains that, at least where a corporation has no direct interest in legal work performed by a lawyer agent for the benefit of a third party, the corporation has practiced law through that lawyer. See San Antonio Bar Ass'n v. Guardian Abstract & Title Co., 291 S.W.2d 697, 701-02 (Tex. 1956); Hexter Title & Abstract Co. v. Grievance Comm., Fifth Congressional Dist., 179 S.W.2d 946, 953-54 (Tex. 1944). (7)

To avoid the Commission's entitlement to summary judgment on this issue, Garcia relies principally on the affirmative defense that his actions for Cristo Vive were expressly permitted by that entity's consent decree with the UPLC. (8) As noted previously, the consent decree enjoined Cristo Vive "and its agents, officers, directors, servants, employees, successors and assigns" from a range of activities related to immigration-related legal services, subject to the following provision:

except to the extent it is legally permitted to do so by 8 C.F.R. § [292.2] and except to the extent it performs any such acts and conduct under the direction, supervision and control of a member of the State Bar of Texas.

Although Garcia admits that Cristo Vive has not been accredited under section 292.2, he contends that the entity complied with the consent decree by "perform[ing] any such acts [otherwise prohibited by the decree] under the direction, supervision and control of a member of the State Bar of Texas"--Garcia. In Garcia's view, compliance with the second exception alone is sufficient to bring Cristo Vive in compliance with the consent decree because the decree's two exceptions are stated in the alternative, not cumulatively. The Commission disputes Garcia's construction of the consent decree, maintaining that Cristo Vive was required to satisfy both exceptions to the consent decree's prohibitions and that its inability to obtain recognition under section 292.2 thus forecloses its reliance on either exception.

We need not reach the proper construction of the consent decree because we conclude that Garcia has not raised a fact issue as to each element of any cognizable defense to which it would be relevant. While he pleaded each defense, Garcia is unclear in his summary-judgment papers and briefing about whether he is relying on former adjudication (res judicata or collateral estoppel) or equitable estoppel. The consent decree cannot support collateral estoppel because the issue of whether Cristo Vive's actions would have constituted UPL if supervised by an attorney was not fully and fairly litigated. See Attorney Gen. of Tex. v. Lavan, 833 S.W.2d 952, 955 (Tex. 1992); Eagle Prop., Ltd. v. Scharbauer, 807 S.W.2d 714, 721 (Tex. 1990). Similarly, we conclude that Garcia did not raise a fact issue regarding the final adjudication-on-the-merits element of res judicata. See Amstadt v. United States Brass Corp., 919 S.W.2d 644, 652 (Tex. 1996).

Nor can Garcia raise a fact issue regarding equitable estoppel. See City of White Settlement v. Super Wash Inc., 198 S.W.3d 770, 773 (Tex. 2006) (noting that "equitable estoppel will not lie against the Government as against private litigants" because "legislative prerogative would be undermined if a government agent could--through mistake, neglect, or an intentional act--effectively repeal a law by ignoring, misrepresenting, or misinterpreting a duly enacted statute or regulation"). (9) We, accordingly, conclude that the district court did not err in granting summary judgment that Garcia assisted Cristo Vive in the UPL, in violation of rule 5.04(b).

Rule 5.04(a): Fee splitting

Rule 5.04(a) provides, with exceptions not applicable here, that "a lawyer or law firm shall not share or promise to share legal fees with a non-lawyer." Tex. Disciplinary R. Prof'l Conduct 5.04(a), reprinted in Tex. Gov't Code Ann., tit. 2, subtit. G app. A (West 2005) (Tex. State Bar R. art. X, § 9). The rationale for this limitation is "to prevent solicitation by lay persons of clients for lawyers and to avoid encouraging or assisting nonlawyers in the practice of law." Tex. Disciplinary R. Prof'l Conduct 5.04 cmt. 1.

It is undisputed that persons served by Cristo Vive pay the entity for legal services provided by or under the supervision of Garcia, that these revenues are commingled with other revenues, and that this common pool of revenues goes to pay Cristo Vive's expenses--including Garcia's approximately $50,000 annual salary and the $85,000 salary of Cristo Vive founder, Jorge Sanchez. Garcia's salary was not dependent on the amount of legal fees collected by Cristo Vive. We agree with the Commission that these undisputed facts establish a violation of rule 5.04(a). (10) See Tex. Comm. on Prof'l Ethics, Op. 498, 58 Tex. B.J. 38 (1995) (holding that, when a lawyer is employed by a corporation not owned solely by licensed attorneys, "the arrangement would amount to an agreement by the lawyer to share legal fees with a non-lawyer (the corporation) in violation of Rule 5.04(a)" if the corporation were to receive payment for the lawyer's services).

Garcia argues that because Cristo Vive has operated at a loss, there were no "fees" capable of being "shared" in violation of rule 5.04(a). This argument confuses fees with profits. The act that Cristo Vive has not netted a profit from the legal services it provides does not negate the fact that it was paid for legal services that Garcia provided. Rule 5.04(a) plainly prohibits a lawyer from sharing his or her legal fees with a non-lawyer, without regard to whether the lawyer and non-lawyer earn a profit.

Garcia also emphasizes that comments 4 and 5 to rule 5.04 contemplate situations in which it is permissible for a lawyer to be employed by a non-lawyer organization to provide legal services to the organization's clients, and that comment 6 expressly permits a lawyer to accept employment with various types of legal-aid offices. See Tex. Disciplinary R. Prof'l Conduct 5.04 cmts. 4-6. These comments, however, merely emphasize that a lawyer in these situations must not allow the non-lawyer organization to direct or influence his or her professional judgment in serving the client. Id. Nothing in these comments implies that such arrangements are categorically permitted without regard to the limitations of other rules. (11)

Accordingly, we conclude that the district court did not err in granting summary judgment that Garcia violated rule 5.04(a) by sharing legal fees with a non-lawyer.

Rule 7.01(a): Practicing under a trade name

Rule 7.01(a) provides, in part, that "[a] lawyer in private practice shall not practice under a trade name." Tex. Disciplinary R. Prof'l Conduct 7.01(a), reprinted in Tex. Gov't Code Ann., tit. 2, subtit. G app. A (West 2005) (Tex. State Bar R. art. X, § 9). Rule 7.01 is broadly aimed at preventing lawyers from using the names of other lawyers or entities so as to mislead the public regarding their identity. Tex. Disciplinary R. Prof'l Conduct 7.01 cmt. 1. In this regard, "Trade names are considered inherently misleading." Id.

The Commission presented undisputed summary-judgment evidence indicating that Garcia provided legal services to third parties under the name of Cristo Vive. This evidence included letters from Garcia to INS regarding, in his words, "clients" he "represent[ed]" in INS proceedings, on "Cristo Vive for Immigrants, C.S.S., Inc." letterhead indicating Cristo Vive's address, and signed "Raul Garcia, Attorney at Law." Similarly, Garcia's business cards were titled "Cristo Vive for Immigrant: Christian Social Services, Inc."; indicated the entity's address, phone number, and an email address "cristovive@ix.netcom.com"; and identified him as "Raul Garcia, ESQ., Attorney at Law/Abogado." The evidence also indicated that Cristo Vive's signage at its offices, while indicating the presence of an "Attorney at Law," referred only to Cristo Vive and not Garcia.

Garcia asserts that rule 7.01(a) does not apply to him because he is not "in private practice," but is "an employee of a legal aid provider" or an in-house "corporate employee" of a non-profit. In support of this argument, Garcia points to the supreme court's attorney-occupancy-tax exemption form, which identifies an exempt category of "employee of a 501(c)(3) or 501(c)(6) non-profit corporation whose employees are prohibited from private practice," and the state bar's membership form, which distinguishes between a lawyer in "Private Law Practice" and "In-House/Corporate Counsel."

To construe rule 7.01(a), however, we seek the supreme court's intent as reflected in the text of the Disciplinary Rules of Professional Responsibility. The Commission points out that the term "private practice" as used in the rules distinguishes between governmental employment, in which a lawyer represents the public interest, and all other types of employment, in which the lawyer represents the interests of a private party. See Tex. Disciplinary R. Prof'l Conduct 1.10, reprinted in Tex. Gov't Code Ann., tit. 2, subtit. G app. A (West 2005) (Tex. State Bar R. art. X, § 9). We agree with the Commission that, from context, "private practice" in rule 7.01(a) was intended to refer to lawyers representing private third-party clients. In light of our disposition of Garcia's other issues, we agree that the district court did not err in granting summary judgment that he violated rule 7.01(a) by using the trade name of Cristo Vive in his representation of private clients.

CONCLUSION

We affirm the judgment of the district court.
____________________________________________

Bob Pemberton, Justice
Before Chief Justice Law, Justices Pemberton and Waldrop
Affirmed
Filed: June 29, 2007

1. These activities included:
1. Contracting with individuals to represent them in preparing, filing, or assisting with the preparation or filing of any documents with the United States Immigration and Naturalization Service;
2. Advising individuals as to their legal rights, the advisability and time limits in the making of claims for temporary and permanent residence, as well as U.S. citizenship;
3. Advising individuals of their rights, duties, and privileges under the law;
4. Advising individuals that they do not require the advice or services of a duly licensed attorney;
5. Soliciting legal services on behalf of another for remuneration;
6. Holding itself out as an attorney authorized to practice law in the State of Texas;
7. Holding itself out as qualified to render professional legal services of any kind;
8. Advising individuals regarding (a) which specific documents or forms might be necessary for filing with a court or governmental agency to accomplish an individual's objective; (b) how to properly fill out such papers; (c) where to correctly fill out such papers; or (d) how to present additional information to a court, government agency or quasi-judicial body;
9. Employing the words "immigration services" or "immigration consultant" in relation to any business it conducts;
10. Advertising or representing in written or electronic media or in any documents ordinarily submitted to the United States Immigration and Naturalization Service that it renders or can render "immigration services," is an "immigration consultant," or any services relating to United States citizenship application, non-immigrant or immigrant status; or
11. Assisting any other individual in the unauthorized practice of law.
Expressly excluded from the prohibited activities were translating documents; taking identification pictures; taking and filing Immigration and Naturalization Service (INS) fingerprint forms; teaching and testing English as a second language, history, government, or other classes; notary services; and "providing communitary services to low income persons," such as referrals to social service agencies and charitable organizations regarding food, shelter, and benefits.
2. The parties agree that the Cristo Vive consent decree mistakenly refers to 8 C.F.R. § 229.1 instead of 8 C.F.R. § 292.2 and that this is purely a typographical error.
3. In his interrogatory responses, which are a part of the summary-judgment record, Garcia explained the "process by which immigration clients are assisted by Cristo Vive" and his role in that process:
Client comes to Cristo Vive and asks for assistance. If the assistance requires legal advice they are told that only an attorney can answer that question and that they cannot give legal advice. They are informed that there is an attorney in the office [who] can advise them. If they want to see the attorney the attorney performs an interview, offers a legal remedy if there is one available, and prescribes the appropriate applications. If they want to hire Cristo Vive to fill out the prescribed applications the attorney will direct, supervise and control the service.
Garcia further described his duties as an attorney with Cristo Vive as follows:
My duties are to supervise, direct and control all services provided by the paralegals in connection with their petitions for status as lawful permanent residents or as citizens of the United States that I may have advised. In initial consultation, I determine what forms, if any, will achieve the result desired by the client, and advise them accordingly. If the client hired Cristo Vive to type out forms and prepare, I direct, supervise, and control the staff in typing out the form, and after they are typed out, I review to make sure everything was answered correctly. I then authorize the client to mail the application [to] the [Bureau of Citizenship and Immigration Services] or [Department of State].
4. Although we construe Garcia's brief to challenge the district court's denial of both his traditional and no-evidence summary-judgment motions, his brief argues only the grounds he asserted in his traditional motion, which are also substantially similar to those in his response to the Commission's motion.
5. Garcia suggests that the UPL prohibition, as a barrier to market entry, may also serve to advance the purely economic interests of attorneys against competition from other service providers, to the detriment of consumers. It is undisputed that both the UPLC proceeding against Cristo Vive and the Commission's proceeding against Garcia were instigated by a local immigration attorney whose client base overlaps with the population served by Cristo Vive. We must decline Garcia's invitation to revisit the policy decisions of the legislature and supreme court that are reflected in the statutes and rules that we are bound to apply.
6. Section 81.101(a) of the government code defines the "practice of law" as:
the preparation of a pleading or other document incident to an action or special proceeding or the management of the action or proceeding on behalf of a client before a judge in court as well as a service rendered out of court, including the giving of advice or the rendering of any service requiring the use of legal skill or knowledge, such as preparing a will, contract, or other instrument, the legal effect of which under the facts and conclusions involved must be carefully determined.
Tex. Gov't Code Ann. § 81.101(a) (West 2005). However, this definition "is not exclusive and does not deprive the judicial branch of the power and authority under both [chapter 81 of the government code] and the adjudicated cases to determine whether other services and acts not enumerated may constitute the practice of law." Id. § 81.101(b).
7. Cf. American Home Assurance Co., Inc. v. Unauthorized Practice of Law Comm., 121 S.W.3d 831, 839-42 (Tex. App.--Eastland 2003, pet. granted) (citing Utilities Inc. v. Montgomery, 138 S.W.2d 1062, 1064 (Tex. 1940) (suggesting that corporate practice of law imputed from acts of lawyer agent would not constitute unauthorized practice of law if corporation retained direct interest in matter); Unauthorized Practice of Law Comm. v. Nationwide Mut. Ins. Co., 155 S.W.3d 590, 598-599 (Tex. App.--San Antonio 2004, pet. filed) (same). The Texas Supreme Court has granted review in American Home, and it remains pending before the court.
8. Garcia also suggests that "the Comments to the Rules of Professional Conduct expressly permit Garcia to undertake his employment with Cristo Vive." From context, it appears that Garcia is referring to comments 4, 5, and 6 to rule 5.04, which he suggests "contemplate situations in which a lawyer may be hired by an organization to provide legal services to another person," including employment with legal-aid offices. See Tex. Disciplinary R. Prof'l Conduct 5.04 cmts. 4-6. As discussed below, rule 5.04 is concerned with maintaining the professional independence of lawyers. The three comments Garcia cites address the professional-independence concern where lawyers are hired to provide legal services to third persons. Contrary to what Garcia suggests, the comments do not imply that such arrangements are categorically permitted without regard to the limitations of other rules. See also Tex. Ins. Code Ann. § 961.303 (west 2006) (non-profit legal-service corporations "must act only as an agent on behalf of its participants" and attorney contracting to provide services for corporation "must be an independent contractor . . . and may not be an employee of the corporation."); Touchy v. Houston Legal Found., 432 S.W.2d 690, 694-95 (Tex. 1968) (contrasting a non-profit corporation that is "directly representing clients as an attorney by signing pleadings in its name, or by appearing for such clients through its employees," which would constitute UPL, with "a legal aid society which acts merely as a conduit or intermediary to bring the attorney and client together," which would not).
9. We express no opinion regarding the Commission's contention that prior judgments in proceedings brought by the UPLC categorically cannot have claim- or issue-preclusive effect on the Commission's subsequent actions because the UPLC and the Commission--though both instrumentalities of the supreme court's regulatory apparatus over the practice of law in Texas--are "separate" entities.
10. The Commission aptly summarized the arrangement in its legal memorandum in support of its motion for partial summary judgment:
Cristo Vive and Respondent have formed a relationship that is analogous to a non-lawyer (Joe) opening "Joe's Divorce Clinic, Inc." and hiring a staff attorney to review and sign all pleadings, while the non-lawyer provides the office space and equipment, advertises for Joe's Clinic, runs the office, and collects a salary substantially larger than that of the attorney. Plus, the divorce clients pay their fees to Joe, who then pays all expenses, including the attorney's salary.
11. Similarly, we reject Garcia's contention that his decisions fell within a zone of professional discretion contemplated by these comments for which he should not be subject to discipline. Tex. Disciplinary R. Prof'l Conduct preamble ¶ 10.

Mark Bogar, M.D. v. Dolores Esparza (Tex.App.-Austin, Jun. 28, 2007)

Dr. Med. Mark Bogar, M.D. v. Esparza (Tex.App.-Austin, Jun. 28, 2007)(Pemberton)

REVERSED AND REMANDED: Opinion by Justice Bob Pemberton
Before Justices Patterson, Pemberton and Waldrop

Mark D. Bogar, M.D. v. Dolores G. Esparza, Individually and as Administrator of the Estate of Katherine G. Guerrero, Deceased; Fernando Guerrero; Sofia G. Butschy; Gilberto Guerrero; Antonio Guerrero; Rosie G. Garza; Benito Guerrero; Josey G. Selvera and Frances G. Faz
Appeal from Probate Court No. 1 of Travis County

FROM PROBATE COURT NO. 1 OF TRAVIS COUNTY, NO. 82,917-A,
HONORABLE GUY S. HERMAN, JUDGE PRESIDING

OPINION BY JUSTICE PEMBERTON

We again address issues arising from the expert report requirements of section 74.351 of the civil practice and remedies code. See Tex. Civ. Prac. & Rem. Code Ann. § 74.351 (West Supp. 2006). Appellant Mark D. Bogar, M. D. appeals the probate court's denial of his motion to dismiss appellees' health care liability claim for failure to make an objective, good faith effort to timely serve an expert report that complies with subsections 74.351(a) and (r)(6). The three issues presented here concern: (1) our subject matter jurisdiction over Dr. Bogar's interlocutory appeal; (2) whether the report appellees served complied with section 74.351's requirements; and, if not, (3) the appropriate appellate remedy. We conclude that we have jurisdiction over Dr. Bogar's interlocutory appeal and that the controlling law and "four corners" of appellees' report leave us no alternative but to reverse and render judgment dismissing appellees' claim and awarding attorney's fees and costs. See id. § 74.351(b). We remand to the probate court to determine the amount of attorney's fees to which Dr. Bogar is entitled. See Garcia v. Marichalar, 198 S.W.3d 250, 255 (Tex. App.--San Antonio 2006, no pet.); Pro Path Servs., L.L.P. v. Koch, 192 S.W.3d 667, 672 (Tex. App.--Dallas 2006, pet. denied).

BACKGROUND

Appellees sued Dr. Bogar and Healthsouth on May 1, 2006, alleging negligence in connection with medical care provided to Katherine R. Guerrero by Dr. Bogar and the "agents, servants, employees, representatives, and staff" of Healthsouth Rehabilitation Hospital of Austin between December 28, 2004, and January 12, 2005, when Ms. Guerrero died. Appellees alleged that following surgery, Ms. Guerrero was placed under the care of Dr. Bogar and Healthsouth and, in the course of her rehabilitative treatment, was given a fatal overdose of pharmaceutical products. Appellees pleaded that an autopsy report from the Travis County Medical Examiner concluded that Ms. Guerrero "died as a result of an overdose of oxycodone and propoxyphene."
On or around June 6, 2006, Appellees served on Dr. Bogar and Healthsouth an expert report prepared by Dr. Jesse Adame that purported to comply with the requirement of subsection 74.351(a). See Tex. Civ. Prac. & Rem. Code Ann. § 74.351(a) ("In a health care liability claim, a claimant shall, not later than the 120th day after the date the claim was filed, serve on each party or the party's attorney one or more expert reports . . . for each physician or health care provider against whom a liability claim is asserted."). Both defendants timely filed objections to the sufficiency of Dr. Adame's report. See id. ("Each defendant physician or health care provider whose conduct is implicated in a report must file and serve any objection to the sufficiency of the report not later than the 21st day after the date it was served, failing which all objections are waived."). Each defendant contended that Dr. Adame's report failed to satisfy the statutory definition of an "expert report" by failing to provide a fair summary of the expert's opinions regarding applicable standards of care, the manner in which the care rendered by each defendant failed to meet the standards, and the causal relationship between such failure and Ms. Guerrero's death. See id. § 74.351(a), (l), (r)(6). Further, Dr. Bogar urged that Dr. Adame, a pathologist, had failed to demonstrate that he was an "expert" qualified to render opinions concerning the standards of care applicable to Dr. Bogar, a physical medicine rehabilitation physician. See id. § 74.351(r)(5), §74.401 (West 2005).

Subsequently, after appellees' 120-day deadline for serving their expert reports expired, see id. § 74.351(a), Dr. Bogar and Healthsouth filed a joint motion seeking dismissal with prejudice, attorney's fees and costs for failure to file an expert report complying with section 74.351. See id. § 74.351(b). Dr. Bogar later filed an amended motion to dismiss adding his earlier challenge to Dr. Adame's qualifications. On January 10, 2007, the probate court denied the dismissal motions. Both Dr. Bogar and Healthsouth timely filed notices of interlocutory appeal. In the interim, Healthsouth settled with appellees. We accordingly address only the appellate issues presented by Dr. Bogar.

ANALYSIS

In a single issue, Dr. Bogar argues that the probate court abused its discretion in denying his motion to dismiss and request for attorney's fees and costs. In addition to disputing the merits of this contention, appellees have filed a motion to dismiss Dr. Bogar's interlocutory appeal for want of jurisdiction, contending that no statute authorizes him to appeal the order he seeks to challenge.

Jurisdiction

Appellate courts generally have subject matter jurisdiction only over appeals from final judgments and have jurisdiction over appeals of interlocutory orders only when that authority is explicitly granted by statute. Academy of Oriental Med., L.L.C. v. Andra, 173 S.W.3d 184, 185 (Tex. App.--Austin 2005, no pet.) (citing Stary v. DeBord, 967 S.W.2d 352, 352-53 (Tex. 1998)). Section 51.014(a) of the civil practice and remedies code authorizes an interlocutory appeal from two types of orders regarding expert reports under chapter 74. First, an interlocutory appeal may be taken from an order that "denies all or part of the relief sought by a motion under Section 74.351(b), except that an appeal may not be taken from an order granting an extension under Section 74.351(c)." Tex. Civ. Prac. & Rem. Code Ann. § 51.014(a)(9) (West Supp. 2006). Second, an interlocutory appeal may be taken from an order that "grants relief sought by a motion under Section 74.351(l)." Id. § 51.014(a)(10).

Appellees assert that the order from which Dr. Bogar seeks to appeal is neither of these. They suggest that "the relief sought by a motion under Section 74.351(b)" is available only where a claimant has failed to timely file an instrument purporting to be an "expert report" by the 120-day deadline of subsection (a), not when a purported "expert report" is timely filed but is found to be deficient. See id. § 74.351(b) ("If . . . an expert report has not been served within the period specified by Subsection (a) . . . ."). Here, appellees maintain, there is no dispute that "the expert report of Dr. Adame was served within the required period of time." Appellees further assert that challenges to the sufficiency of expert reports, as contrasted with timeliness, are governed exclusively by section 74.351(l). Section 74.351(l) states that "[a] court shall grant a motion challenging the adequacy of an expert report only if it appears to the court, after hearing, that the report does not represent an objective good faith effort to comply with the definition of an expert report in Subsection (r)(6)." Id. § 74.351(l). Because Dr. Bogar's motion, in appellees' view, is "a motion under section 74.351(l)," they assert that his right of interlocutory appeal is controlled by section 51.014(a)(10) rather than (a)(9), and no appeal is available from the probate court's order denying him relief. See id. § 51.014(a)(10) (permitting appeal from an order that "grants relief sought by a motion under Section 74.351(l)") (emphasis added). They equate this case to Academy of Oriental Medicine, L.L.C. v. Andra, where we held that an order denying a motion challenging the sufficiency of an expert report was governed by section 74.351(l) rather than section 74.351(b) and that "[b]ecause this appeal challenges an order that is neither an order denying the relief sought by a motion under § 74.351(b) nor one granting relief sought by a motion under § 74.351(l), we lack jurisdiction to hear it." 173 S.W.3d at 186-89.

We disagree with appellees' readings of section 74.351 and Andra. Under section 74.351(b), as we have recently reiterated, an "expert report has not been served within the period specified by Subsection (a)" not only if it is untimely (or never) served, but also if the purported timely filed "expert report" is deficient with respect to its required contents. See Austin Heart P.A. v. Webb, ___ S.W.3d ___, ___; No. 03-06-00607-CV, 2007 Tex. App. LEXIS 3600, at *19 (Tex. App.--Austin May 9, 2007, no pet. h.); Apodaca v. Russo, ___ S.W.3d ___, ___ No. 03-06-00258-CV, 2007 Tex. App. LEXIS 3467, at *13-14 (Tex. App.--Austin May 2, 2007, no pet. h.); cf. Walker v. Gutierrez, 111 S.W.3d 56, 61 (Tex. 2003) (dismissal under former article 4590i warranted for "failure to comply" with report deadline by either failure to file or failure to file adequate report). This conclusion is apparent from the text and structure of section 74.351. Subsection (a) requires the claimant to file one or more "expert reports" not later than the 120th day after the date the original petition was filed, and subsection (b) mandates sanctions "[i]f, as to a defendant physician or health care provider, an expert report has not been served within the period specified by Subsection (a)." "Expert report" is defined within section 74.351 as: "a written report by an expert that provides a fair summary of the expert's opinions as of the date of the report regarding applicable standards of care, the manner in which the care rendered by the physician or health care provider failed to meet the standards, and the causal relationship between that failure and the injury, harm, or damages claimed." Tex. Civ. Prac. & Rem. Code Ann. § 74.351(r)(6); see id. § 74.351(r)(5) (definition of "expert"). Thus, if the instrument does not comply with subsection (r)'s "expert report" definition, it does not satisfy the claimant's requirement under subsection (a) and exposes the claimant to potential sanctions under (b).

Consistent with this construction, subsection (c) of section 74.351 contemplates that noncompliance with the subsection (r) "expert report" definition renders a purported "expert report" not "served" for purposes of subsection (a) and (b). Subsection (c) provides that "[i]f an expert report has not been served within the period specified by Subsection (a) because elements of the report are found deficient," the trial court is afforded discretion to grant a single 30-day extension "in order to cure the deficiency." Tex. Civ. Prac. & Rem. Code Ann. § 74.351(c) (emphases added). Subsection (c), as we will later discuss, is an exception to subsection (b)'s sanctions requirement in cases where "an expert report has not been served within the period specified by Subsection (a)" because the report is deficient, and applies to a subset of such cases. Id. § 74.351(b).

Contrary to appellees' suggestions, section 74.351(l) does not create a distinct procedure for challenging the sufficiency of expert reports that is mutually exclusive of motions seeking sanctions under subsection (b). Subsection (l) establishes a standard of proof for any motion challenging the sufficiency of an expert report: whether the report represents "an objective good faith effort to comply with the definition of an expert report in Subsection (r)(6)." Id. § 74.351(l). A motion challenging the sufficiency of an expert report, section 74.351 contemplates, may be made either before or after the expiration of the 120-day deadline in subsection (a). If made after the deadline passes, the defendant may assert the insufficiency of the report as grounds for sanctions under subsection (b), subject to subsection (c), for the claimant's failure to "serve" an "expert report" within the 120-day period. If the motion is made before the 120-day deadline--as may be necessitated by subsection (a)'s 21-day deadline to file and serve any objection to the sufficiency of a purported "expert report," id. § 74.351(a)--the defendant cannot yet seek sanctions under subsection (b) because the claimant could still serve a proper "expert report" "within the period specified by Subsection (a)." Id. § 74.351(b). With this type of motion, unlike a motion seeking subsection (b) sanctions, the relief available, as we observed in Andra, "is not so clearly enumerated," but would appear to contemplate a declaration of the report's insufficiency or the striking of it. 173 S.W.3d at 187.

In Andra, we also pointed out that for purposes of the interlocutory appeals available under section 51.014(a)(9) and (10), in effect "[a] motion challenging the adequacy of an expert report that does not request the relief set out in section 74.351(b) is a motion for relief under 74.351(l)." Id. We held that the motion in question was governed exclusively by subsection (l), and thus subject to section 51.014(a)(10), because it had been filed before the claimant's 120-day deadline had expired and had not requested the sanctions of dismissal or attorney's fees characteristic of section 74.351(b) motions. See id. at 186-89. However, we acknowledged that "where there is no timely expert report because the report or reports were found deficient," an interlocutory appeal would be available "when the court had denied a defendant's motion [under 74.351(b)] but had not granted the plaintiff additional time to cure deficiencies." Id. at 184 n.7 (emphasis added).

Here, Dr. Bogar filed objections to the sufficiency of Dr. Adame's report within 21 days of service, see Tex. Civ. Prac. & Rem. Code Ann. § 74.351(a), and a motion, after the 120-day deadline had expired, explicitly invoking subsection (b) and asserting that the probate court should dismiss appellees' claim against him with prejudice and award attorney's fees and costs for failure to file a proper "expert report" by the deadline. See id. § 74.351(b). The probate court denied that motion without granting an 30-day extension. Id. § 74.351(b), (c). That order "denies all or part of the relief sought by a motion under Section 74.351(b)," and we have subject matter jurisdiction to adjudicate Dr. Bogar's appeal from that order. Id. § 51.014(a)(9); see Andra, 173 S.W.3d at 186-87. We accordingly deny appellees' motion to dismiss Dr. Bogar's appeal.

Sufficiency of Dr. Adame's report

We turn now to Dr. Bogar's issue. In his motion for sanctions under section 74.351(b), Dr. Bogar asserted that (1) Dr. Adame's report was insufficient under the "expert report" definition of section 74.351(r)(6), and (2) Dr. Adame, as a pathologist, was not qualified as an expert to evaluate Dr. Bogar's performance as a rehabilitative medicine specialist. We agree with the former contention and need not reach the latter.

As noted above, the "expert report" or reports that a health care liability claimant must serve under section 74.351(a) must provide "a fair summary of the expert's opinion as of the date of the report regarding the applicable standards of care, the manner in which the care rendered by the physician or health care provider failed to meet the standards, and the causal relationship between that failure and the injury, harm, or damages claimed." Tex. Civ. Prac. & Rem. Code Ann. § 74.351(r)(6). A trial court, again, must grant a motion challenging the adequacy of a report only if the report "does not represent an objective good faith effort to comply" with this definition of "expert report." Id. § 74.351(l). To constitute a "good faith effort," the report must provide enough information to fulfill two purposes: (1) it must inform the defendant of the specific conduct the plaintiff has called into question; and (2) it must provide a basis for the trial court to conclude that the claims have merit. Austin Heart, ___ S.W.3d at ___, 2007 Tex. App. LEXIS 3600, at *4 (citing Bowie Mem'l Hosp. v. Wright, 79 S.W.3d 48, 52 (Tex. 2002); American Transitional Care Ctrs. of Tex., Inc. v. Palacios, 46 S.W.3d 873, 879 (Tex. 2001)). Although a report need not marshal all of a claimant's proof, it must include the expert's opinion on each of the elements identified in section 74.351. Id. at *4-5 (citing Palacios, 46 S.W.3d at 878). It is not enough for the report merely to state the expert's conclusions about the statutory elements. Id. (citing Palacios, 46 S.W.3d at 379). "Rather, the expert must explain the basis of his statements to link his conclusions to the facts." Id. at *5 (quoting Bowie Mem'l, 79 S.W.3d at 52) (quoting Earle v. Ratliff, 998 S.W.2d 882, 890 (Tex. 1999)).

Importantly, because the statute dictates what is required in the report, the only information relevant to determining whether a report complies with the statute is that within "the four corners" of the report. Id. (citing Palacios, 46 S.W.3d at 878). This requirement "precludes a court from filling gaps in a report by drawing inferences or guessing as to what the expert likely meant or intended." Id. (citing Bowie Mem'l, 79 S.W.3d at 53).

We review a trial court's ruling on a section 74.351(b) motion under an abuse of discretion standard. Palacios, 46 S.W.3d at 877-78. A trial court abuses its discretion when it acts in an arbitrary or unreasonable manner or acts without reference to any guiding rules or principles. Downer v. Aquamarine Operators, Inc., 701 S.W.2d 238, 241 (Tex. 1985). A clear failure by the trial court to analyze or apply the law correctly also constitutes an abuse of discretion. Walker v. Packer, 827 S.W.2d 833, 840 (Tex. 1992).

The document prepared by Dr. Adame recites his qualifications and concludes that "I am qualified based on my education, training and experience to offer an expert opinion regarding the cause and mechanism of death of Mrs. Katherine Ramirez Guerrero. As a pathologist, I am familiar with the standard of care required of physicians not to prescribe drugs either alone or in combination that will cause a fatal overdose." "Such conduct," Dr. Adame adds, "falls below the standard of care required of physicians."

Dr. Adame then lists the medical records and other materials he had reviewed, and summarizes Ms. Guerrero's medical history. Dr. Adame notes that Ms. Guerrero was 76 years of age, and had a "past medical history of hyperlipidemia, osteoarthritis, poorly controlled hypertension, and chronic dizziness." He recounts that Ms. Guerrero had complained of left hip pain following a December 25, 2004 fall and had been "admitted to Seton/Brackenridge Hospital after is was determined that she had a nondisplaced fracture of the left femur," but "[i]t was also determined at that time, that no surgical intervention was needed." Adame then states:
Her medical problems and rehabilitation were managed by HealthSouth Rehabilitation Hospital of Austin. She was transferred to that facility on December 28, 2004. She was placed on a Duragesic patch at 25 mcg on December 29, 2004. It was increased to 50 mcg on December 30, 2004 because of continued significant pain. She was also given her usual home medications including Doxepin, Norvasc, Zescril, Tenormin, and Imdur. Because of significant drowsiness with the Duragesic patch, her dose was reduced back to 25 mcg. She was also given Protonix for gastrointestinal prophylaxis. Despite a fairly stable hospital course, her pain increased. On January 7, 2005, after her records were reviewed and she was cleared for surgery, she was taken to the operating room at Seton/Brackenridge Hospital for open reduction and internal fixation of her left femur. Her surgery went well and she was transferred back to HealthSouth Rehabilitation Hospital of Austin on January 8, 2005. She resumed her medical regimen along with physical and occupational therapy. Her pain persisted and she was taken off of Duragesic patch post surgery. OxyContin was added to her therapy, initially at 10 mg and later increased to 20 mg. She had bouts of constipation and loose stool which was medically managed. On January 12, 2005 at 9:34 p.m. she experienced cardiopulmonary arrest. Despite cardiopulmonary resuscitation until 10:13 p.m., she was pronounced dead.

Dr. Adame then summarizes the "significant findings" of the autopsy report from the Travis County Medical Examiner's Office, including "the conclusions . . . that Mrs. Guerrero died as a result of an overdose of oxycodone and propoxyphene."

Adame then states his "opinions and conclusions." He begins: "I concur with the autopsy conclusions." He observes that the medical examiners "performed a complete autopsy with toxocological analysis of blood, vitreous humor, and urine," and references certain autopsy findings. Dr. Adame describes the composition and effect of oxycodone and propoxyphene as various dosing levels, including the levels indicative of toxicity and death. Drawing on these observations, he states the following:

Mrs. Guerrero had postmortem blood oxycodone concentration of 0.25 mg/L. This level and the clinical findings of nausea and labored breathing (noted in nursing notes shortly before her death) indicates that the oxycodone was inducing respiratory depression.

* * *

Mrs. Guerrero had postmortem blood propoxyphene levels of 1.0 mg/L. This concentration of propoxyphene and the clinical findings of nausea, labored breathing, and cardiac arrest (noted in nursing notes shortly before her death) indicates that the propoxyphene was inducing respiratory depression, cardiac arrhythmia, and circulatory collapse and subsequent death. In addition, the respiratory depression was exacerbated by the high concentrations of oxycodone (see above).

Dr. Adame then concludes:

In summary, Mrs. Guerrero had toxic levels of oxycodone along with lethal levels of propoxyphene which caused her demise. The mechanism of death was respiratory depression, cardiac arrhythmia, and circulatory collapse. Additionally, autopsy examination failed to demonstrate an anatomic cause of death.

All of my opinions above are predicated upon a reasonable medical probability.

Dr. Adame's report fails to comply with the requirements of section 74.351. Most notably, it does not identify the person or persons whose conduct is the subject of any of his opinions regarding standard of care, causation, and death. We have held that where the identity of a defendant is not explicitly mentioned within the "four corners" of the report, the report is, for that reason alone, deficient as to that defendant because it would require the reader to infer or make an educated guess as to whose actions the expert is complaining. Austin Heart, ___ S.W.3d at ___, 2007 Tex. App. LEXIS 3600, at *15; Apodaca, ___ S.W.3d at ___, 2007 Tex. App. LEXIS 3467, at *13; see Marichalar, 198 S.W.3d at 255. The report likewise fails to explain, among other things, how Dr. Bogar breached any standard of care or how that alleged breach caused Ms. Guerrero's death. See Jernigan v. Langley, 195 S.W.3d 91, 93-94 (Tex. 2006) (affirming dismissal under former article 4590i where report made only "passing mention" of defendant physician and failed to state how he breached the standard of care or how his alleged breach caused injury); see also Palacios, 46 S.W.3d at 879-80 (conclusory statement that "precautions to prevent [patient's] fall were not properly utilized" did not sufficiently apprise physician whether the expert believed that the standard of care required him "to have monitored [the patient] more closely, restrained him more securely, or done something else entirely"). We hold that the probate court abused its discretion in denying Dr. Bogar's motion for sanctions under section 74.351(b). We sustain Dr. Bogar's issue.

Remedy

In the probate court, appellees requested that, in the event Dr. Adame's report was found deficient, the court grant them a discretionary 30-day extension under section 74.351(c) to enable them to cure any deficiencies in the report. See Tex. Civ. Prac. & Rem. Code Ann. § 74.351(c). As earlier noted, subsection (c), like (b), applies when "an expert report has not been served within the period specified by Subsection (a)." See id. § 74.351(b), (c). Where the "expert report has not been served . . . because elements of the report are found deficient," the trial court is afforded discretion to grant a single 30-day extension in which the claimant can "cure the deficiency." Id. § 74.351(c). On appeal, appellees requested that if we reversed the probate court's order denying Dr. Bogar's motion, we remand to the probate court, in lieu of rendering a judgment of dismissal, to afford the lower court the opportunity to exercise its discretion under subsection (c). We recently granted such relief in another case involving an "expert report" that we held deficient. Austin Heart, ___ S.W.3d at ___, 2007 Tex. App. LEXIS 3600, at *20-21. We discerned that subsection (c) manifested legislative intent that in "at least some situations where a timely report is deficient . . . the trial court should consider whether the deficiency is such that it warrants allowing a cure period." Id. We found such a situation to exist in Austin Heart, and held that subsection (c) required us to remand in lieu of rendering a judgment of dismissal and sanctions. Id.

In Austin Heart, we considered an expert report that repeatedly referred in a background section to a defendant physician, Dr. Kessler, among other identified and unidentified caregivers, but failed to explicitly link Dr. Kessler's conduct to the expert's otherwise sufficient opinions regarding the applicable standard of care, how it was breached, and how the breach caused injury. Id. at *14-15. We concluded that the report was deficient because "it requires the reader to infer or make an educated guess that Dr. Cororve [the expert] is identifying Dr. Kessler as the physician who breached the standard of care and caused injury" and that "[t]here is nothing in the report that links Dr. Kessler to Dr. Cororve's opinions regarding the breach of the standard of care and causation any more than Dr. Rodgers or the other 'various physicians' references." Id. at *11. However, we concluded that "[t]he tenor of Dr. Cororve's report, coupled with the fact that there is only one physician defendant, makes it quite likely that Dr. Cororve intended to opine that Dr. Kessler breached the standard of care and caused injury even though the report did not contain that opinion. The report's failure on this point is the kind of defect that the cure provisions of section 74.351(c) were designed to address." Id. at *14. We added that the report "was served timely, it makes more than a passing reference to Dr. Kessler, and it notes conduct by Dr. Kessler that could be linked to the expert's conclusions regarding the breach of the standard of care and causation. It is deficient only because it does not expressly make the link between the expert's conclusions and the referenced conduct of Dr. Kessler." Id. at *19.

We distinguished Dr. Cororve's report with those that other courts have held to be so deficient as to constitute an incurable "no report"--as if the claimant had wholly failed to file an instrument purporting to be an "expert report" as to the defendant within the 120-day period---and not merely containing "elements . . . found deficient." Id. at *19; see Tex. Civ. Prac. & Rem. Code Ann. § 74.351(c). In Jernigan v. Langley, the Texas Supreme Court affirmed a trial court's dismissal of a health care liability claim as to Dr. Jernigan based on a report that made a mere "passing reference" to him and wholly failed to link him or his conduct to the expert's opinions regarding breach of standard of care. 195 S.W.3d at 94. The supreme court concluded that "the trial court had no discretion but to conclude, as it did here, that Langley's claims against Dr. Jernigan must be dismissed." Id. Similarly, in Garcia v. Marichalar, a report referenced several health care providers without mentioning the defendant physician. 198 S.W.3d at 254-55. As we observed, "[t]here was literally nothing in the report that related to the physician in any way" and that "[t]hus, the report was no report to him." Austin Heart, ___ S.W.3d at ___, 2007 Tex. App. LEXIS 3600, at *16. We acknowledged that in these types of cases, trial (and appellate) courts logically could have no discretion to effectuate a cure period where no report exists as to a defendant; the only possible "cure" would be the creation of a new, previously nonexistent report, an alternative that the legislature has forbidden under section 74.351. Id. at *18; see Apodaca, ___ S.W.3d at ___, 2007 Tex. App. LEXIS 3467, at *13; Marichalar, 198 S.W.3d at 255.

We contrasted these reports with that in Austin Heart, observing that:

[i]f the expert is of the opinion that Dr. Kessler's conduct breached the standard of care and caused injury, he will not have to generate a new, previously nonexistent report. He will simply have to add the link between his already stated conclusions and the already referenced conduct of Dr. Kessler. Therefore, the circumstances here are not similar to the situation where a plaintiff simply has missed the deadline for serving a report with respect to the conduct of a physician. Austin Heart, ___ S.W.3d at ___, 2007 Tex. App. LEXIS 3600, at *21. By contrast, we conclude that the present case is.

As previously noted, Dr. Adame never mentions Dr. Bogar anywhere in his report. He never describes the standard of care potentially applicable to Dr. Bogar, other than a broad reference to "the standard of care required of physicians not to prescribe drugs either alone or in combination that will cause a fatal overdose," which he never applies or analyzes in light of specific facts and circumstances. Dr. Adame never describes how Dr. Bogar might have breached a standard of care. In essence, Dr. Adame's report is a second autopsy report, opining about the cause of Ms. Guerrero's death without explaining who caused it or how.
Although the line between "no report" and a defective-but-curable report may sometimes be elusive, we conclude that Dr. Adame's report is clearly "no report." Its defects include the types of wholesale omissions identified in Jernigan and Marichalar, and Dr. Adame cannot cure them simply by "add[ing] the link between his already stated conclusions and the already referenced conduct" of Dr. Bogar. See Austin Heart, ___ S.W.3d at ___, 2007 Tex. App. LEXIS 3600, at *21.

There is nothing in the report regarding Dr. Bogar that could be linked to anything. Consequently, Dr. Adame could "cure" the deficiencies in his report only by "generat[ing] a new, previously nonexistent report" as to Dr. Bogar. See id. Such a remedy is proscribed by section 74.351. (1)

CONCLUSION

We must render judgment dismissing appellees' claims against Dr. Bogar with prejudice and awarding Dr. Bogar attorney's fees and costs. See Tex. Civ. Prac. & Rem. Code Ann. § 74.351(b). We remand to the probate court for a determination of the amount of the attorney's fee award. See Marichalar, 198 S.W.3d at 256-57; Pro Path Servs., L.L.P. v. Koch, 192 S.W.3d 667, 672 (Tex. App.--Dallas 2006, pet. denied).

__________________________________________
Bob Pemberton, Justice
Before Justices Patterson, Pemberton and Waldrop;
Dissenting Opinion by Justice Patterson
Reversed and Remanded
Filed: June 28, 2007

1. The dissent criticizes this holding, suggesting that we could remand to the probate court in the same manner as in Austin Heart, ___ S.W.3d at ___ (Patterson, J., dissenting). As the dissent has acknowledged in Austin Heart and elsewhere, section 74.351 does not permit such a remedy where, as here, the report constitutes no report. See Austin Heart, ___ S.W.3d at ___, 2007 Tex. App. LEXIS 3600, at *39 (Patterson, J., dissenting) ("[t]he difference between the two is strategically significant. If the report is 'no report,' then the trial court must dismiss the case with prejudice and has no discretion to grant a 30-day extension.") (emphasis in original); Apodaca, ___ S.W.3d at ___, 2007 Tex. App. LEXIS 3467, at *13 ("If a report fails to address the defendant physician, it constitutes no report as to that defendant, and the trial court may not grant a 30-day extension.") (citing Garcia v. Marichalar, 185 S.W.3d 70, 74 (Tex. App. San Antonio 2005, no pet.).