Cities of Corpus Christi et al v. PUC, No. 03-06-00585-CV (Tex.App.- Austin, Mar. 5, 2008)(Opinion by Justice Patterson)("Having concluded that the Commission's final order was consistent with the relevant statutes and was supported by substantial evidence, we affirm the district court's judgment, which affirmed the final order of the Commission.")
Appellants, Cities of Corpus Christi, et al. // Cross-Appellant, AEP Texas Central Company v. Appellee, Public Utility Commission of Texas // Cross-Appellees, Cities of Corpus Christi, et al.--Appeal from 53rd District Court of Travis County
FROM THE DISTRICT COURT OF TRAVIS COUNTY, 53RD JUDICIAL DISTRICT
NO. D-1-GN-05-004378, HONORABLE SCOTT H. JENKINS, JUDGE PRESIDING
M E M O R A N D U M O P I N I O N
This is an appeal from a final order of the Public Utility Commission in a ratemaking proceeding initiated by AEP Texas Central Company (TCC) to set transmission and distribution rates. The district court affirmed the Commission's final order. Because we conclude that the Commission's final order was consistent with the plain language of the relevant statutes and was supported by substantial evidence, we affirm the judgment of the district court.
FACTUAL AND PROCEDURAL BACKGROUND
In 1999, the legislature determined it was in the public interest to restructure and partially deregulate the Texas retail electric power industry. See generally Tex. Util. Code Ann. § 39.001 (West 2007). To accomplish this mandate, the legislature enacted Senate Bill 7 ("SB 7"), which amended the Public Utility Regulatory Act ("PURA"). (1) See Act of May 27, 1999, 76th Leg., R.S., ch. 405, 1999 Tex. Gen. Laws 2543 (now codified in Chapter 39 of the PURA, Tex. Util. Code Ann. §§ 39.001-.910 (West 2007)); see also CenterPoint Energy Houston Elec., LLC v. Gulf Coast Coalition of Cities, No. 03-05-00557-CV, 2007 Tex. App. LEXIS 9919, at *3-*18 (Tex. App.--Austin Dec. 20, 2007, no pet. h.) (describing statutory framework for transition to competitive retail electric market) (hereafter "CenterPoint"). SB 7 required each integrated electric utility to separate its business activities into three separate units--a power generation company, a transmission and distribution utility, and a retail electric provider. See Tex. Util. Code Ann. § 39.051. After the passage of SB 7, and with few exceptions, only transmission and distribution utilities remain subject to rate regulation by the Commission. See id. § 39.001(a).
This appeal arises from the first ratemaking proceeding for TCC (2) since the enactment of SB 7. TCC initiated this ratemaking proceeding on November 3, 2003, when it filed an application with the Commission to increase the transmission and distribution rates for its entire service area. (3) TCC's application sought approval to increase its rates by $66.5 million, or 14.7%, to recover a claimed revenue requirement of $519.9 million.
The Commission referred TCC's application to the State Office of Administrative Hearings for a contested case proceeding. Several parties intervened in the proceedings before SOAH. Included among the intervenors were the Cities served by TCC, (4) CPL Retail Energy, LP, (5) the Office of Public Utility Counsel (OPC), the State of Texas, and the Texas Industrial Energy Consumers (TIEC). (6) Following a hearing and briefing on all disputed matters, the administrative law judges recommended findings of fact and conclusions of law in a proposal for decision. After the Commission issued two orders remanding the cause to SOAH for additional proceedings, the ALJs issued a PFD on Remand. Ultimately, the Commission held its own hearing on certain issues raised by the parties. Upon considering additional evidence, the Commission adopted in part and rejected in part, the ALJs' recommendations in the original PFD and the PFD on Remand. In its final order, the Commission determined that TCC's appropriate revenue requirement was $443.6 million. This reduction represented an agreed disallowance of $10.5 million in affiliate expenses, plus other disallowances made by the Commission.
TCC, the Cities, and the State sought judicial review of the Commission's final order in district court. See id. § 15.001; Tex. Gov't Code Ann. §§ 2001.171, .174, .176 (West 2000). The district court consolidated all of the petitions for judicial review into one cause for purposes of trial. After considering the pleadings, briefs, and argument of the parties, as well as the administrative record, the district court entered final judgment affirming the Commission's final order in all respects. This appeal followed. Only TCC and the Cities appeal from the district court's final judgment. (7)
DISCUSSION
On appeal, TCC and the Cities challenge the district court's judgment affirming the Commission's final order on various grounds. TCC raises three issues. TCC argues that the district court erred in affirming the Commission's final order because the Commission erroneously imposed a $7.5 million penalty reducing TCC's proposed rates after determining that TCC initiated the ratemaking proceeding, erroneously reduced TCC's proposed rates based on an estimate of future costs, and erroneously applied a consolidated tax savings adjustment to reduce TCC's proposed rates. The Cities raise four issues. The Cities argue that the district court erred in affirming the Commission's final order because the Commission violated section 36.058 of the PURA by including affiliated expenses in TCC's rates without making the required statutory findings, erroneously severed service quality and reliability issues into another proceeding and failed to consider TCC's poor service quality when setting TCC's rates, violated section 36.060 of the PURA by allocating only 23.1% of the consolidated tax savings to TCC, and failed to allocate to ratepayers any of the gain realized from the sale of TCC's affiliated retail electric provider.
Standard of Review
We review the Commission's final order under the substantial evidence rule. See Tex. Util. Code Ann. § 15.001; Tex. Gov't Code Ann. § 2001.174. "This is a limited standard of review that gives significant deference to the agency in its field of expertise." Railroad Comm'n v. Torch Operating Co., 912 S.W.2d 790, 792 (Tex. 1995); see Texas Health Facilities Comm'n v. Charter Medical-Dallas, Inc., 665 S.W.2d 446, 452 (Tex. 1984). We presume that the agency's order is valid and that its findings, inferences, conclusions, and decisions are supported by substantial evidence. City of El Paso v. Public Util. Comm'n, 883 S.W.2d 179, 185 (Tex. 1994); Charter Med., 665 S.W.2d at 452. The complaining party has the burden to overcome this presumption. City of El Paso, 883 S.W.2d at 185; Hammack v. Public Util. Comm'n, 131 S.W.3d 713, 725 (Tex. App.--Austin 2004, pet. denied). In conducting a substantial evidence review, we evaluate the entire record to determine whether the evidence, as a whole, is such that reasonable minds could have reached the conclusion the agency must have reached in order to take the disputed action. Texas State Bd. of Dental Exam'rs v. Sizemore, 759 S.W.2d 114, 116 (Tex. 1988); Suburban Util. Corp. v. Public Util. Comm'n, 652 S.W.2d 358, 364 (Tex. 1983). We may not substitute our judgment for that of the agency on the weight of the evidence on questions committed to the agency's discretion. Tex. Gov't Code Ann. § 2001.174; Charter Med., 665 S.W.2d at 452; H.G. Sledge, Inc. v. Prospective Inv. & Trading Co., Ltd., 36 S.W.3d 597, 602 (Tex. App.--Austin 2000, pet. denied).
Under a substantial evidence review, the issue for the reviewing court is not whether we believe the agency's decision was correct, but whether the record demonstrates some reasonable basis for the agency's action. Charter Med., 665 S.W.2d at 452; Central Power & Light Co. v. Public Util. Comm'n, 36 S.W.3d 547, 561 (Tex. App.--Austin 2000, pet. denied). The evidence in the record may preponderate against the decision of the agency and nevertheless amount to substantial evidence. Charter Med., 665 S.W.2d at 452; Meier Infinity v. Motor Vehicle Bd., 918 S.W.2d 95, 98 (Tex. App.--Austin 1996, writ denied). We will uphold the agency's order unless the agency's decision is: not reasonably supported by substantial evidence, in violation of a constitutional or statutory provision, in excess of the agency's statutory authority, made through unlawful procedure, affected by other error of law, arbitrary or capricious, or characterized by an abuse of discretion. See Tex. Gov't Code Ann. § 2001.174(2)(A)-(F).
Certain issues raised by the parties involve questions of statutory construction, which we review de novo. See, e.g., City of San Antonio v. City of Boerne, 111 S.W.3d 22, 25 (Tex. 2003) (appellate courts review matters of statutory construction de novo); In re Humphreys, 880 S.W.2d 402, 404 (Tex. 1994) (questions of law are always subject to de novo review). When construing a statute, our primary goal is to determine and give effect to the legislature's intent. City of San Antonio, 111 S.W.3d at 25. To determine legislative intent, we look to the statute as a whole, as opposed to isolated provisions. State v. Gonzalez, 82 S.W.3d 322, 327 (Tex. 2002). We begin with the plain language of the statute at issue and apply its common meaning. City of San Antonio, 111 S.W.3d at 25. Where the statutory text is unambiguous, we adopt a construction supported by the statute's plain language, unless that construction would lead to an absurd result. Fleming Foods of Tex., Inc. v. Rylander, 6 S.W.3d 278, 284 (Tex. 1999). We give serious consideration to an agency's interpretation of the statutes it is charged with enforcing, so long as that interpretation is reasonable and consistent with the statutory language. Tarrant Appraisal Dist. v. Moore, 845 S.W.2d 820, 823 (Tex. 1993); Steering Comms. for the Cities Served by TXU Elec. v. PUC, 42 S.W.3d 296, 300 (Tex. App.--Austin 2001, no pet.). This is particularly true when the statute involves a complex subject matter. Steering Comms. for Cities, 42 S.W.3d at 300. Courts, however, "do not defer to administrative interpretation in regard to questions which do not lie within administrative expertise, or deal with a nontechnical question of law." Rylander v. Fisher Controls Int'l, Inc., 45 S.W.3d 291, 302 (Tex. App.--Austin 2001, no pet.).
Additionally, certain issues challenge the Commission's authority. The Public Utility Commission "is a creature of the Legislature and has no inherent authority." Public Util. Comm'n v. GTE-Southwest, Inc., 901 S.W.2d 401, 407 (Tex. 1995). Like other state administrative agencies, the Commission "has only those powers that the Legislature expressly confers upon it" and "any implied powers that are necessary to carry out the express responsibilities given to it by the Legislature." Public Util. Comm'n v. City Pub. Serv. Bd., 53 S.W.3d 310, 316 (Tex. 2001). It is not enough that the power claimed by the Commission be reasonably useful to the Commission in discharging its duties; the power must be either expressly conferred or necessarily implied by statute. The agency may not "exercise what is effectively a new power, or a power contradictory to the statute, on the theory that such a power is expedient for administrative purposes." Id.
Ratemaking Process
Before addressing the merits of the parties' contentions, we provide a brief discussion of the ratemaking process. Although the legislature in 1999 deregulated certain portions of the Texas electric market, including power generation and retail sales, the legislature did not deregulate transmission and distribution utilities. See Tex. Util. Code Ann. § 39.001(a). The rates of all transmission and distribution utilities remain subject to regulation, and all of the traditional ratemaking rules and principles apply.
As a general rule, a utility's rates must be just and reasonable. Id. § 36.003(a) (West 2007). Regulated utilities are entitled to rates that allow them to collect total revenues equal to their cost of service and provide the utility an opportunity to earn a reasonable return on its invested capital. Id. § 36.051 (West 2007); see Suburban Util. Corp., 652 S.W.2d at 363. Fundamental in the utility ratemaking process is the principle that utility rates are set for the future, not the past. State v. Public Util. Comm'n, 883 S.W.2d 190, 198-99 (Tex. 1994); Railroad Comm'n v. Lone Star Gas Co., 656 S.W.2d 421, 425 (Tex. 1983).
Even so, ratemaking starts with an historic test year. See GTE-Southwest, Inc., 901 S.W.2d at 411; 16 Tex. Admin. Code §§ 25.231(a) (cost of service), .234(b) (rate design) (2007) (Pub. Util. Comm'n). Because rates are to be charged in the future, the historic test-year amounts must be adjusted for known and measurable changes to more accurately reflect costs that will be incurred in the future. The Commission has the authority to incorporate known and measurable changes to test-year data at its discretion. See City of El Paso, 883 S.W.2d at 188; see also GTE-Southwest, Inc., 901 S.W.2d at 411; 16 Tex. Admin. Code §§ 25.231(a)-(b) (cost of service), .234(b) (rate design). Once these adjustments have been made, the Commission must determine a reasonable rate of return. See Tex. Util. Code Ann. § 36.052 (West 2007). To establish a reasonable rate of return, the Commission considers several factors, including the efforts of the utility in conserving resources, the quality of the utility's service, the efficiency of the utility's operations, and the quality of the utility's management. Id. With this general description in mind, we turn to the parties' complaints on appeal.
Penalty for Initiating Rate Increase
In its first issue on appeal, TCC complains that the Commission erroneously reduced TCC's proposed rates by imposing a $7.5 million penalty after determining that TCC had violated the terms of the Integrated Stipulation Agreement (ISA) signed when TCC's parent company American Electric Power (AEP) merged with Central and South West Corporation (CSW). TCC argues that the Commission misconstrued the unambiguous terms of the ISA and, therefore, erroneously reduced TCC's proposed rates. Because we conclude that the plain language of the ISA allowed the Commission to impose a penalty if it determined that TCC initiated a proceeding to increase rates within six years after the ISA was signed, we reject TCC's claim that the Commission erroneously imposed a penalty when it reduced TCC's proposed rates.
A. The ISA
In April 1998, AEP and CSW initiated proceedings before the Commission seeking approval of the terms of their proposed merger agreement as required under section 14.101(b) of the PURA, which authorizes the Commission to review proposed combinations and "to determine whether the action is consistent with the public interest." See Tex. Util. Code Ann. § 14.01(b) (West 2007). The Commission opened Docket No. 19265 to consider various issues posed by the merger, and several parties intervened. During these proceedings, most of the parties reached agreement on the disputed issues and memorialized the terms of their agreement in the ISA. Consistent with the Texas Supreme Court's holding in City of El Paso v. Public Utility Commission, the Commission made an independent evaluation of the merits of the ISA and determined that the terms of the ISA were just and reasonable and supported by substantial evidence. See 883 S.W.3d at 183. The Commission approved the terms of the ISA in its final order in Docket No. 19265.
The terms of the ISA recognized that the AEP/CSW merger would produce savings over previous operations and provided that the Texas AEP subsidiaries, including TCC, were to share those savings with ratepayers in fixed annual amounts known as "net merger savings rate reduction riders." To guarantee these savings, the ISA expressly limited the ability of the utilities to seek rate increases. For the first three years following the merger, the ISA prohibited the utilities from seeking any adjustment to rates, subject only to a force majeure exception. During years four through six, the utilities, including TCC, could seek an increase in rates, but doing so would trigger the ISA's penalty provision. This penalty provision required the utility to apply substantial predetermined "revenue requirement credits," or reductions, to offset any possible rate increase.
In relevant part, the ISA penalty provision states:
In any proceeding initiated by a Texas operating company requesting an increase to overall base rate revenues to become effective prior to the end of the six year period after the effective date of the merger:
(a) The net merger savings expense item and annual amount of amortization of costs to achieve the merger will not be included in the calculation of the cost of service unless the Texas operating company demonstrates:
(i) that the proposed rate increase results from circumstances not directly or indirectly related to the merger; and
(ii) that the full level of achieved merger savings for the applicable year as reflected in Attachment D have been achieved; and
(b) the revenue requirements otherwise determined to be reasonable and necessary will be reduced by the annual amounts included in Attachment E. (8)
B. The Commission's decision and TCC's claim
The Commission determined that the plain language of this penalty provision applied because TCC initiated a proceeding requesting an increase to overall base rate revenues. It is this determination that TCC challenges on appeal.
Arguing that the Commission misconstrued the language of the ISA penalty provision, TCC maintains that the Cities, not TCC, initiated the proceeding to increase base rate revenues. In support of this argument, TCC claims that six of the Cities "took the first decisive steps that began the rate proceeding" by adopting resolutions "to proceed with an inquiry into transmission and distribution rates charged by [TCC]." (9) Prior to any filings, TCC and the six cities agreed in a stipulation signed July 14, 2003, ("July 14th Agreement") that in lieu of filing separate rate packages with each city, TCC would file a standard rate filing package with each city and with the Commission on the same date. The July 14th Agreement reflects that TCC specifically agreed to make the filing with the Commission "in order to initiate the [Commission's] review of AEP Texas Central Company's rates." TCC argues that it only filed the ratemaking proceeding with the Commission in response to the Cities' rate inquiry.
Having approved the ISA as part of its final order approving the AEP/CSW merger, the Commission had exclusive jurisdiction to interpret the provisions of the ISA and to resolve any dispute arising therefrom, including the question of who initiated the proceeding. See In re Entergy Corp., 142 S.W.3d 316, 324 (Tex. 2004); Public Util. Comm'n v. Southwestern Bell Tel. Co., 960 S.W.2d 116, 119-20 (Tex. App.--Austin 1997, no pet.). The Commission's construction of the ISA is consistent with the plain language of the penalty provision.
We agree with the Commission that the plain language of the ISA mandates that the penalty provision applies "[i]n any proceeding initiated by a Texas operating company requesting an increase to overall base rate revenues" prior to the end of the sixth year after the AEP/CSW merger. (Emphasis added.) The penalty provision is not limited in its application to proceedings before municipalities, or to proceedings before the Commission, but applies in any proceeding in which the utility seeks an increase in base rate revenues. TCC, not the Cities, filed an application to increase its base rate revenues. It matters not whether this application was filed with the Cities or with the Commission. Because TCC's application sought an increase in base rate revenues, the Commission properly determined that the penalty provision applied. The Commission correctly observed that TCC could have filed an application seeking to defend its existing rates, but TCC chose instead to seek approval of an increase in its base rate revenues. (10)
We likewise reject TCC's argument that the proceeding before the Commission was merely a continuation of proceedings before the municipalities. Neither the record nor the law supports this contention. The record reflects--and TCC acknowledges--that this proceeding was not an appeal from a decision by a municipality as permitted under sections 33.051, 33.052, or 33.053 of the PURA. See Tex. Util. Code Ann. §§ 33.051-.053 (West 2007). It was an original application filed with the Commission to increase TCC's base rate revenues and establish systemwide rates.
For these reasons, we overrule TCC's first issue.
Post-Test-Year Adjustments
In its second issue, TCC complains that the Commission erred in adopting TCC's proposed "post-test-year adjustment" for reduced post-employment benefit expenses. TCC challenges the Commission's adoption of this particular adjustment, which was based on an actuarial study, because the Commission declined to adopt three other proposed post-test-year adjustments based on actuarial studies. TCC contends that the Commission's adoption of this adjustment was arbitrary and capricious. We disagree.
The record reflects that TCC proposed four post-test-year adjustments related to expenses for several categories of employee benefits, including employee pensions, group insurance, post-retirement benefits other than pensions (OPEBs), and post-employment benefit expenses. TCC witness Randall Hamlett testified that each of these proposed adjustments were based on an actuarial estimate of future costs anticipated to occur after the test year. The other parties challenged all but one of TCC's proposed post-test-year adjustments. The proposed adjustment for post-employment benefit expenses was not challenged. In its final order, the Commission adopted only TCC's proposed adjustment for post-employment benefit expenses.
The supreme court has acknowledged that ratemaking relies substantially upon informed judgment and expertise and utilizes projections and estimates in virtually all areas. See GTE-Southwest, Inc., 901 S.W.2d at 411. The Commission has broad discretion when setting the rates of public utilities. See Texas Alarm & Signal Ass'n v. Public Util. Comm'n, 603 S.W.2d 766, 772 (Tex. 1980); Southwestern Bell Tel. v. Public Util. Comm'n, 571 S.W.2d 503, 515 (Tex. 1978). The Commission's ratemaking authority includes the discretion to disallow improper expenses. See Suburban Util. Corp., 652 S.W.2d at 362. The Commission may decide in its discretion whether to incorporate "known and measurable" changes to the test-year data. See Office of Pub. Util. Counsel v. Public Util. Comm'n, 185 S.W.3d 555, 566 n.14 (Tex. App.--Austin 2006, pet. denied); 16 Tex. Admin. Code § 25.231(a). We will not substitute our judgment for that of the Commission on the weight to be given the evidence on questions committed to the Commission's discretion. Office of Pub. Util. Counsel, 185 S.W.3d at 567; see also Tex. Gov't Code Ann. § 2001.174.
TCC would fault the Commission for adopting an uncontested adjustment proposed by TCC merely because the Commission rejected other contested proposals. In support of its argument, TCC cites to statements made by the commissioners during their deliberations at an open meeting. However, it is immaterial what the commissioners may have thought or stated in the process of arriving at a decision. See City of Frisco v. Texas Water Rights Comm'n, 579 S.W.2d 66, 72 (Tex. Civ. App.--Austin 1979, writ ref'd n.r.e.). Such statements are simply not relevant to the judicial determination of whether the Commission's final order was supported by substantial evidence. Id.
In its final order, the Commission gave independent reasons for its rejection of TCC's proposed post-test-year adjustments. The Commission's explanations were supported by the evidence and were not based solely on the rejection of actuarial studies.
With regard to employee pensions, the Commission adopted the ALJs' recommendation rejecting this post-
test-year adjustment. In the PFD, the ALJs explained that they rejected the testimony offered by TCC witness Michael Turk regarding the adjustment for employee pensions. Turk testified that his projections were based on declines in the equity markets, declines in interest rates, a recent increase in actuarial liabilities, and his own prediction that these declines would continue into 2005. Turk further testified that he "could not predict with reasonable certainty" how stock prices or interest rates would affect future actuarial pension funding. Based on Turk's testimony, the ALJs determined that TCC's proposed adjustment for employee pensions was not a "known and measurable change" and recommended disallowance of this expense. The Commission adopted this recommendation in its final order.
With regard to OPEBs, the ALJs found that this expense item was subject to the Commission's rule 25.231(b)(1)(H)(i), which expressly requires such expenses to be based on "actual payments made." See 16 Tex. Admin. Code § 25.231(b)(1)(H)(i). Because TCC's proposed adjustment was based on actuarial projections, and not actual payments made, the ALJs determined that TCC's proposed adjustment for OPEBs did not comply with the Commission's rule and recommended that the Commission disallow this expense item. The Commission adopted this recommendation in its final order.
With regard to group insurance, the Commission determined that the evidence presented by TCC did not satisfy the "known and measurable" standard for changes to test-year data. The record reflects that TCC presented the testimony of various witnesses, but none of these witnesses provided direct explanatory testimony on the issue of group insurance benefits. TCC witness Michael Turk testified generally that TCC provided various benefits including medical and dental benefits, but he did not testify about the cost of these benefits. And no other TCC witness testified about the costs of group insurance. In its final order, the Commission determined that the evidence presented by TCC was insufficient to support an increase above the test-year actual cost. Finally, regarding post-employment benefits, TCC proposed a reduction in rates for this expense item. The record reflects that TCC presented evidence and testimony in support of this proposed adjustment. None of the parties challenged TCC's proposal. In the absence of any challenge to TCC's proposal, the Commission adopted TCC's proposed adjustment to reduce post-employment benefit expenses.
As a reviewing court, the issue before us is not whether we believe the Commission made the correct decision, but whether there is a reasonable basis in the record for the action taken by the Commission. Charter Med., 665 S.W.2d at 452; Central Power & Light Co., 36 S.W.3d at 561. Because no one challenged TCC's proposed adjustment to post-employment benefit expenses, we conclude that the Commission acted within its discretion to adopt TCC's proposal. (11) We likewise conclude that the Commission's order was supported by substantial evidence, and we overrule TCC's second issue.
Consolidated Tax Savings Adjustment
In its third issue, TCC complains that the Commission erred in adopting an adjustment for consolidated tax savings. For the following reasons, we reject TCC's complaint.
Federal law allows affiliated corporations to file a single, joint income tax return, or consolidated tax return, in certain situations. See 26 U.S.C. § 1501 (2002). By filing a consolidated tax return, affiliated corporations can reduce their total tax liability by offsetting their otherwise taxable gains with the losses of their unprofitable affiliates. See Central Power & Light Co., 36 S.W.3d at 555.
Because the potential for substantial savings exists when a corporation files a consolidated tax return, section 36.060 of the PURA requires the Commission to consider such savings when setting a utility's rates. Tex. Util. Code Ann. § 36.060 (West 2007). This section provides:
Unless it is shown to the satisfaction of the regulatory authority that it was reasonable to choose not to consolidate returns, an electric utility's income taxes shall be computed as though a consolidated return had been filed and the utility had realized its fair share of the savings resulting from that return, if:
(1) the utility is a member of an affiliated group eligible to file a consolidated income tax return; and
(2) it is advantageous to the utility to do so.
Id. Under this provision, the Commission is required to calculate TCC's fair share of tax savings resulting from the filing of a consolidated tax return. Id.; see Central Power & Light Co., 36 S.W.3d at 555.
Here, the Commission determined and TCC agrees that TCC's parent company, AEP, enjoyed significant tax savings as a result of filing a consolidated tax return. However, in its rate filing package with the Commission, TCC failed to allocate any of AEP's tax savings to TCC. So, as required under section 36.060, the Commission adopted an adjustment to TCC's claimed income taxes to reflect TCC's appropriate share of consolidated tax savings.
TCC argues that the Commission lacked authority to make such an adjustment because section 36.060 only requires sharing of tax savings when a utility does not file a consolidated return. TCC's construction of section 36.060 conflicts with the plain language of that statute. Section 36.060 plainly requires the Commission to calculate TCC's taxes as though a consolidated return had been filed, unless TCC can show to the Commission's satisfaction that it was reasonable to choose not to consolidate tax returns. TCC does not attempt to demonstrate that it was reasonable for AEP to choose not to consolidate returns. Under the plain language of section 36.060, the Commission was therefore required to calculate TCC's taxes as if a consolidated return had been filed, which it was. We reject TCC's contention that the Commission may only consider a consolidated tax savings adjustment when the company does not file a consolidated tax return.
TCC further contends that the Commission's decision to adopt a consolidated tax savings adjustment was not supported by substantial evidence. Because the record demonstrates that the Commission's decision was supported by substantial evidence, we likewise reject this contention. In its final order, the Commission reduced TCC's federal income tax expense by $2,322,545 (12) to account for consolidated tax savings. This amount was based on a proxy proposed by TCC, (13) which allocated TCC's share of consolidated tax savings over the relevant fifteen-year period based on TCC's rate base. This approach was consistent with the Commission's approach in TCC's last ratemaking proceeding, which was affirmed by this Court in Central Power & Light v. Public Utility Commission. (14) See 36 S.W.3d at 555-57. As the Commission explained in its final order, a consolidated tax savings adjustment is appropriately based on the value of the tax shield that the utility provides to the parent company and its nonregulated affiliates. The record evidence demonstrates that the Commission calculated the adjustment to TCC's taxes based on the value of the tax shield that TCC provided to its parent company. TCC witness Jeffrey Bartsch agreed that the adjustment adopted by the Commission was calculated in accordance with the Commission's past application of the "interest-credit"--or "rate-base"--methodology. We conclude that the Commission's decision was supported by substantial evidence, and we overrule TCC's third issue.
In a related issue, the Cities argue in their third issue on appeal that the Commission's consolidated tax savings adjustment failed to follow the Commission's own precedent and was not supported by substantial evidence. As a result, the Cities contend that the Commission's order fails to allocate TCC's fair share of consolidated tax savings to ratepayers.
In support of this contention, the Cities cite to this Court's holding in Reliant Energy, Inc. v. Public Utility Commission, 153 S.W.3d 174 (Tex. App.--Austin 2004, pet. denied). The Cities' reliance on Reliant Energy is misplaced. In Reliant Energy, this Court recognized that "[t]he legislature has granted the Commission broad discretion in determining a utility's fair share of the savings arising from the filing of a consolidated tax return by the parent company." Id. at 198. As in Central Power & Light, we affirmed the Commission's use of the "time-value-of-tax-shield" methodology to calculate the appropriate consolidated tax savings adjustment. Id. at 198 n.13; see also supra n.14 (explaining that the time-value-of-tax-shield methodology is also referred to
as the "interest-credit" or "rate-base" methodology).
As previously discussed, the Commission adopted the ALJs' recommendation on this issue, which was based on a proxy proposed by TCC. The Cities argue that the Commission should have adopted the Cities' proxy instead of that proposed by TCC. We conclude that the Commission's decision to adopt the proxy submitted by TCC was neither arbitrary nor capricious. The Commission was entitled to accept or reject, in whole or in part, the testimony of the various witnesses who testified. City of Corpus Christi v. Public Util. Comm'n, 188 S.W.3d 681, 695 (Tex. App.--Austin 2005, pet. denied). In light of our previous conclusions that the Commission's decision was consistent with its precedent and supported by substantial evidence, we overrule the Cities' third issue.
Affliate Costs
In their first issue, the Cities argue that the Commission erred by including affiliate costs in TCC's cost of service without making the specific findings required by section 36.058 of the PURA. For the reasons that follow, we reject the Cities' complaint.
TCC originally requested $63.8 million in affiliate expenses. Section 36.058 of the PURA provides that the Commission may not include affiliate costs in a utility's rates unless the Commission makes a specific finding of reasonableness and necessity for each item or class of items, and also finds that the price charged by the affiliate to the utility is no higher than the price charged by the affiliate to other purchasers. See Tex. Util. Code Ann. § 36.058 (West 2007). (15) Because the Commission disagreed with the ALJs' recommendations regarding affiliate costs, the Commission conducted its own hearing on this issue. The Commission heard evidence from all of the parties on affiliate costs. However, before the Commission made its final decision on this issue, TCC and TIEC filed a nonunanimous stipulation (NUS) proposing a $10.5 million disallowance to TCC's requested affiliate costs. The Cities did not oppose the adoption of the NUS, but they continued to oppose the level of administrative and general (A&G) expenses proposed by TCC, including $13.8 million of affiliate costs.
The Cities argued that TCC's A&G expenses were too high in relation to the A&G expenses of other utilities. Based on the testimony of two witnesses, the Cities argued that all of TCC's affiliate costs that were allocated to distribution A&G should be disallowed. Cities witness Gerald Tucker proposed an initial disallowance of $14.8 million in TCC's affiliate A&G costs. Cities witness A.D. Patton proposed an additional reduction of $13.8 million to TCC's affiliate A&G costs based on his comparison of TCC's A&G costs in relation to the A&G costs of other utilities.
In its final order, the Commission rejected the approach urged by Cities witness Patton and the Cities' claim that TCC's A&G expenses were too high when compared to other utilities. The Commission's final order adopted the ALJs' findings that all but two of TCC's A&G expenses were reasonable and necessary. With regard to affiliate costs, the Commission adopted the NUS proposed by TCC and TIEC. The Commission's final order included the following findings of fact:
158E. The NUS proposed a disallowance of $10,501,860 in [affiliate] expenses . . . .
158F. The NUS proposes to allocate the stipulated disallowance as follows: $10,300,935 to the distribution function and $200,925 to the transmission function.
158G. The stipulating parties agree that the remaining $53,289,706 in affiliate expenses, which consists of $49,860,227 in affiliate expenses from AEPSC and $3,429,479 in affiliate expenses from other affiliates, are reasonable and necessary, and that the price is not higher than the price charged by the supplying affiliate to its other affiliates or divisions or to nonaffiliated persons for the same item or class of items.
158H. The range of expert testimony regarding disallowances of affiliate costs are as follows:
Cities $16.6 million
OPC $13.4 million
CPL Retail $10.3 million
The Commission's final order also included the following conclusions of law:
25A. $53,289,706 of TCC's affiliate expenses are reasonable and necessary, and the price charged to TCC is not higher than the price charged by the supplying affiliate to its other affiliates or divisions or to nonaffiliated persons for the same item or class of items.
25B. To be approved by the Commission, a non-unanimous stipulation must comply with applicable law; be just and reasonable, and in the public interest; and be supported by a preponderance of the record evidence. City of El Paso v. Public Util. Comm'n, 883 S.W.2d 179, 183 (Tex. 1994).
25C. The non-unanimous stipulation providing for a disallowance of $10.5 million in affiliate expenses is just and reasonable, and in the public interest, and is supported by a preponderance of the record evidence.
In light of their stipulated agreement, the Cities do not challenge the Commission's adoption of the NUS on appeal. Rather the Cities argue that the findings made by the Commission in relation to the NUS are insufficient to satisfy the requirements of section 36.058 of the PURA because they do not take into account those affiliate A&G costs challenged by Cities witness Patton. We disagree.
The record reflects that the NUS, as it was adopted by the Commission, covered all $63.8 million of TCC's requested affiliate costs. Under the terms of the NUS, the Commission approved $53.3 million of affiliate costs and disallowed $10.5 million. With respect to the affiliate costs approved by the Commission, the findings and conclusions quoted above demonstrate that the Commission made the required findings under section 36.058 of the PURA. See Tex. Util. Code Ann. § 36.058. The Commission expressly found that the affiliate costs approved under the terms of the NUS were "reasonable and necessary, and the price charged to TCC is not higher than the price charged by the supplying affiliate to its other affiliates or divisions or to nonaffiliated persons for the same item or class of items." We conclude that this finding satisfies the requirements of section 36.058 for those affiliate costs approved under the terms of the NUS. See id. § 36.058(c)(1)-(2). Because the record demonstrates that the NUS covered all of TCC's requested affiliate costs, including those costs challenged by Cities witness Patton we conclude that the Commission was not required to make additional findings under section 36.058. (16) We overrule the Cities' first issue.
Quality of Service
The Cities next argue that the Commission failed to consider TCC's quality of service when setting TCC's return on equity and that the Commission erred in severing quality of service issues into another proceeding. Accordingly, the Cities argue that the Commission's decision violates sections 36.052, 38.001, and 38.005 of the PURA. See Tex. Util. Code Ann. §§ 36.052; 38.001, .005 (West 2007).
Section 36.052 requires the Commission to consider various factors when establishing a utility's reasonable return on invested capital. See id. § 36.052. Among those factors to be considered by the Commission are: the efforts and achievements of the utility in conserving resources; the quality of the utility's service; the efficiency of the utility's operations; and the quality of the utility's management. Id. Section 38.001 requires an electric utility to provide service that is "safe, adequate, efficient, and reasonable." Id. § 38.001. In addition, section 38.005 imposes service quality and reliability standards relating to the delivery of electricity by transmission and distribution utilities. Id. § 38.005. Section 38.005 authorizes the Commission to take appropriate enforcement action against those utilities who fail to meet the service and reliability standards imposed by the PURA. Id. § 38.005(b).
The record demonstrates that various witnesses testified regarding the appropriate return for TCC. Cities witness Stephen Hill testified that the appropriate rate of return was between 9.00% and 9.75%. Commission Staff witness Slade Cutter testified that the proper rate of return should be between 9.22% and 10.23%. CPL Retail witness Dr. Charles Smaistrla testified that the appropriate rate of return was 10.00% to 10.25%. OPC witness Dr. Carol Szerszen testified that the appropriate rate of return was 9.2% to 10.0%. TIEC witness Michael Gorman testified that the appropriate rate of return was between 9.2% to 10.5%. And TCC witness Paul Moul testified that the rate of return should be 12.00%.
In its final order, the Commission adopted the nonunanimous stipulation proposed by TCC, TIEC, CPL, and Commission Staff regarding TCC's return on invested capital. Under the terms of this stipulation, the Commission set TCC's rate of return at 10.125%. The Cities complain that the Commission's decision fails to consider quality of service because the Commission severed all reliability and quality of service issues into another proceeding.
The record demonstrates that the Commission severed only the issue of "service quality commitments" into another proceeding. This issue concerned how rate credits related to service quality were to be calculated under TCC's "Service Quality Plan." Because the Commission was already considering service quality commitments in another pending proceeding, (17) the Commission severed this issue from TCC's rate case so that the Commission could consider all of the service quality commitments together. (18) The Commission did not sever the issue of service quality as it relates to TCC's rate of return.
The Commission's procedural rules expressly allow the Commission to sever a proceeding or an issue if such severance "would serve the interest of efficiency or prevent unwarranted expense and delay; and the applicant's ability to present its case and other parties' ability to respond to the applicant's case would not be unduly prejudiced." 16 Tex. Admin. Code § 22.34 (2007) (Pub. Util. Comm'n). The Texas Supreme Court has recognized that administrative agencies are entitled to considerable procedural flexibility, see City of Corpus Christi v. Public Util. Comm'n, 51 S.W.3d 231, 262 (Tex. 2001), and that courts may interfere with the procedures of an administrative agency only if they are arbitrary and capricious or deny due process. Lewis v. Metropolitan Sav. & Loan Ass'n, 550 S.W.2d 11, 16 (Tex. 1977). Accordingly, we conclude that the Commission acted within its discretion to sever the issue of service quality commitments from Docket No. 28840 into Docket No. 25157.
The Cities do not contend that they were denied due process, but they do contend that, as a result of the severance, the Commission failed to consider one of the required statutory factors in section 36.052. We construe the Cities' claim to be that the Commission's order was arbitrary and capricious. See, e.g., City of El Paso, 883 S.W.2d at184 (explaining that an agency's order is arbitrary when it fails to consider a factor that the legislature directs it to consider). But the record belies this claim.
TCC and the Commission agree that the Commission was required to consider TCC's quality of service when setting TCC's rate of return. The record reflects that the Commission's resolution of TCC's rate of return was based on a nonunanimous stipulation (different from the stipulation regarding affiliate costs), which only the Cities and one other party opposed. The Commission's final order includes the following findings of fact:
60. The terms of the Return Stipulation are that: TCC's ROE be set at 10.125%; its capital structure be set at 60% debt and 40% equity; its rate of return on invested capital be set at 7.475%; and no penalty be applied to TCC's ROE for quality or reliability of service.
* * *
64. The quality of TCC's service is generally adequate and does not warrant a reduction i[n] TCC's ROE.
65. The stipulated return of 10.125% is more likely than not a reasonable return on TCC's equity.
The Commission's final order also included the following conclusion of law:
60. PURA § 36.052 requires the Commission to consider the "quality of the utility's services" and the "quality of the utility's management: in establishing a reasonable return on invested capital as part of the PUC's "establishing an electric utility's rates."
These findings and conclusion make clear that the Commission considered TCC's quality of service when determining TCC's ROE. The plain language of section 36.052 merely requires the Commission to consider the statutory factors. Tex. Util. Code Ann. § 36.052. It does not require the Commission to give weight to any particular factor. Consistent with our prior holdings, we conclude that the legislature left it to the Commission's discretion to weigh the importance of each factor in a given case. See, e.g., Meier Infinity, 918 S.W.2d at 100. Because the Commission's final order contains underlying findings that reasonably and logically support the statutory criteria, we conclude that the Commission properly considered the required factor of quality of service. Id. We likewise conclude that the Commission's adoption of the nonunanimous Return Stipulation was proper. (19) See City of El Paso, 883 S.W.2d at 183. We overrule the Cities' second issue.
Gains from the Sale of TCC's AREP
In their fourth and final issue, the Cities assert that the Commission improperly failed to allocate the gains from the sale of TCC's affiliated retail electric provider to ratepayers. The Cities argue that the Texas Supreme Court's decision in Public Utility Commission v. Gulf States Utilities Co., 809 S.W.2d 201, 211 (Tex. 1991), required the Commission to consider certain factors, which the Cities complain were not considered, in allocating any gain realized from the sale of utility assets. Because we conclude that the PURA does not authorize the Commission to allocate the gains from the sale of TCC's AREP to ratepayers, we reject the Cities' final complaint.
Pursuant to section 39.051 of the PURA, utilities were required to unbundle into three separate entities to accomplish the legislative mandate of deregulation. See Tex. Util. Code Ann. § 39.051 (requiring utilities to separate into a power generation company, a retail electric provider, and a transmission and distribution utility). This section contemplates that a utility might sell off its assets to accomplish the required separation and expressly provides that such transactions were not subject to those provisions in the PURA which require the Commission to capture gains on asset sales for ratepayers. (20)
Id. § 39.051(g) (exempting unbundling transactions from the requirements of sections 14.101, 35.034, and 35.035 of the PURA).
The Commission concluded that the sale of TCC's AREP was an unbundling transaction within the meaning of section 39.051. The Commission also concluded that the sale of TCC's AREP did not involve any transmission and distribution assets. The Commission therefore refused to allocate any of the gains from TCC's sale of its AREP to ratepayers. The Cities point to no other provision in the PURA that would require the Commission to allocate the gains from the sale of TCC's AREP to ratepayers. Because we conclude that the Commission's decision was consistent with the plain language of section 39.051(g), we reject the Cities' contention that the Commission was required to consider the factors identified by the supreme court in Gulf States Utilities. We likewise conclude that the Commission properly declined the Cities' request to allocate any gains from the sale of TCC's AREP to ratepayers. We overrule the Cities' fourth issue.
CONCLUSION
Having concluded that the Commission's final order was consistent with the relevant statutes and was supported by substantial evidence, we affirm the district court's judgment, which affirmed the final order of the Commission.
__________________________________________
Jan P. Patterson, Justice
Before Justices Patterson, Pemberton and Waldrop
Affirmed
Filed: March 5, 2008
1. Tex. Util. Code Ann. §§ 11.001-64.158 (West 2007).
2. TCC is the transmission and distribution utility of the formerly integrated utility known as Central Power & Light Company.
3. TCC serves an area of approximately 44,000 square miles in south Texas.
4. There were 86 cities served by TCC, including Corpus Christi, Harlingen, Laredo, McAllen, and Victoria. We refer to all 86 cities collectively as the "Cities."
5. CPL Retail Energy, LP, is the affiliated retail electric provider of the formerly integrated utility known as Central Power & Light Company.
6. Commission Staff also participated as a party in these proceedings.
7. Neither the State nor TIEC appealed the district court's judgment, but TIEC did file a brief in support of the Commission regarding the first issue raised on appeal by TCC.
8. See Tex. Pub. Util. Comm'n, Application of Central & South West Corp. & Am. Elec. Power Co., Inc. Regarding Proposed Business Combination, Docket No. 19265 (Nov. 18, 1999) (Final Order) (ISA § 3.F.(3)).
9. The cities of Corpus Christi, Edna, Harlingen, McAllen, Laredo, and Victoria all filed similar resolutions to inquire into TCC's rates.
10. The Commission's decision is further supported by TCC's statement in its brief that TCC's filing "did nothing more than ensure that the overall outcome of the process would result in systemwide rates." There is nothing in the PURA that requires TCC to charge "systemwide" rates. Indeed, the PURA expressly allows for utilities to charge different rates for different customer classes. See Tex. Util. Code Ann. §§ 36.001(a)(1), .003(b)-(c) (West 2007); see also id. § 36.005 (West 2007) (allowing utilities to charge different rates for areas outside a municipality). Thus, TCC was not obligated to initiate a ratemaking proceeding at the Commission to charge systemwide rates. Having chosen to do so, TCC must accept the consequences of its action.
11. Having requested and received the adjustment it sought for post-employment benefits, TCC was neither aggrieved nor prejudiced by the Commission's decision. It is therefore arguable whether TCC was entitled to judicial review, much less reversal, on this issue. Compare Tex. Util. Code Ann. § 15.001 (allowing any party to proceeding before the Commission to seek judicial review), with Tex. Gov't Code Ann. §§ 2001.171 (allowing only aggrieved parties to seek judicial review of agency decisions), .174 (authorizing reversal only where substantial rights have been prejudiced) (West 2000).
12. The consolidated tax savings adjustment was $1,509,656. This amount was "grossed-up" to $2,322,545 to capture the tax effect of the adjustment and to reflect the proper revenue requirement.
13. TCC witnesses Jeffrey Bartsch and Donald Moncrief testified on remand regarding the proposed allocation and adjustment for consolidated tax savings.
14. This approach is also known as the "interest-credit," "rate-base," or "time-value-of-tax-shield" methodology. We do not agree with the Commission's assertion that TCC challenges the methodology chosen by the Commission.
15. In relevant part, section 36.058 states:
(a) Except as provided by Subsection (b), the regulatory authority may not allow as capital cost or as expense a payment to an affiliate for:
(1) the cost of a service, property, right, or other item; or
(2) interest expense.
(b) The regulatory authority may allow a payment described by Subsection (a) only to the extent that the regulatory authority finds the payment is reasonable and necessary for each item or class of items as determined by the commission.
(c) A finding under Subsection (b) must include:
(1) a specific finding of the reasonableness and necessity of each item or class of items allowed; and
(2) a finding that the price to the electric utility is not higher than the prices charged by the supplying affiliate for the same item or class of items to:
(A) its other affiliates or divisions; or
(B) a nonaffiliated person within the same market area or having the same market conditions.
Tex. Util. Code Ann. § 36.058.
16. Because we conclude that the Commission's findings satisfied the requirements of section 36.058 and additional findings were therefore unnecessary, we do not address TCC's estoppel argument.
17. Docket No. 25157 was established in 2001 to address certain elements of the "Service Quality Plan," which was created during the merger between AEP and CSW.
18. That the Commission severed only the issue of service quality of commitments is confirmed by the plain language of TCC's motion to sever.
19. The record demonstrates that the Commission considered the nonunanimous stipulation "on its merit" and found that it was based on a preponderance of the record evidence and that the proposed rate of return was reasonable and, therefore, in the public interest. See City of El Paso v. Public Util. Comm'n, 883 S.W.2d 179, 183 (Tex. 1994).
20. Section 39.051(g) states:
Transactions by electric utilities involving sales, transfers, or other disposition of assets to accomplish the purposes of this section are not subject to Section 14.101, 35.034, or 35.035.
Tex. Util. Code Ann. § 39.051(g).
Friday, March 7, 2008
Claim of off-set in child support arrearage case where child lived intermittently with both parents turns on conflicting testimony
In the interest of A. F. N. No. 03-07-00164-CV (Tex.App.- Austin, Mar. 5, 2008)(Opinion by Justice Patterson ) (enforcement of child support arrearage) (Before Justices Patterson, Puryear and Henson)
Appeal from 200th District Court of Travis County
FROM THE DISTRICT COURT OF TRAVIS COUNTY, 200TH JUDICIAL DISTRICT
NO. D-1-FM-90-488,147, HONORABLE WILLIAM E. BENDER, JUDGE PRESIDING
M E M O R A N D U M O P I N I O N
Appellant Gary Neal appeals an order of enforcement for child support arrearage brought by appellee the Office of the Attorney General ("OAG") on behalf of appellee Lyn L. Upton for the support of A.F.N., a child. The OAG sought approximately $82,000 in arrearage, and the trial court granted a judgment for $41,000. In a single issue, Neal contends the trial court erred by failing to offset the child support arrearage completely because Upton voluntarily relinquished actual possession and control of A.F.N. to Neal for approximately eight years. See Tex. Fam. Code Ann. § 157.008 (West 2002). For the reasons that follow, we overrule Neal's issue and affirm the trial court's judgment.
BACKGROUND
Neal and Upton were divorced in 1990. Upton was appointed sole managing conservator of their child, A.F.N., Neal was appointed possessory conservator, and Neal was ordered to make monthly child support payments to Upton of $377 until A.F.N. turned eighteen. In March 2005, the OAG filed a motion for enforcement seeking a money judgment for child support arrearage of approximately $82,000. (1) Neal answered, pleading an affirmative defense that he was entitled to offset or reimbursement against the arrearage. (2) His defense was that he should not have to pay the arrearage because he took care of A.F.N. for periods of time in excess of his court-ordered periods of possession. See id.
At a bench trial in December 2006 on the motion for enforcement, Upton, Neal, and A.F.N. were among the witnesses to testify, and their testimony directly conflicted. Although Neal did not dispute the amount of accrued court-ordered child support, Neal testified that A.F.N. lived with him from the time A.F.N. was in first grade through the end of A.F.N.'s eighth grade school year.
Upton, in contrast, testified that A.F.N. lived with her and not with Neal during those years except for brief periods of time. A.F.N. testified that from the time he was nine years of age until high school, he rotated between his parents every three days and that he lived with his mother in high school. The parties also testified inconsistently as to the amount of support that Neal provided A.F.N. during the alleged periods of time that Neal was taking care of A.F.N.
At the conclusion of the testimony, the trial court found that Neal was entitled to an offset of approximately half of the accrued child support that the OAG sought in the enforcement action and granted a $41,000 arrearage judgment against Neal. (3) This appeal followed.
ANALYSIS
In one issue, Neal contends that the trial court erred in not "allowing a complete offset of his child support arrearage where the evidence showed that during the accrual of the arrearage [Neal] had possession of the child in excess of court-ordered visitation periods." He seeks a partial remand for the trial court to determine whether he should have to pay the $41,000 judgment, "taking into account the evidence of [his] possession of the child and [his] earning capacity." (4) Neal in effect attacks the legal and factual sufficiency of the evidence to support the trial court's judgment.
In determining whether a finding is supported by legally sufficient evidence, we view the evidence in the light most favorable to the finding, "crediting favorable evidence if reasonable jurors could, and disregarding contrary evidence unless reasonable jurors could not." City of Keller v. Wilson, 168 S.W.3d 802, 807 (Tex. 2005). We indulge every reasonable inference that would support the finding. Id. at 822. In reviewing the factual sufficiency of the evidence, we consider and weigh all the evidence presented at trial, including any evidence contrary to the judgment. Plas-Tex, Inc. v. U.S. Steel Corp., 772 S.W.2d 442, 445 (Tex. 1989); Cain v. Bain, 709 S.W.2d 175, 176 (Tex. 1986). We set aside a finding for factual insufficiency if it is "so contrary to the overwhelming weight of the evidence as to be clearly wrong and unjust." Cain, 709 S.W.2d at 176.
We review arrearage judgments for child support under an abuse of discretion standard. See Pedregon v. Sanchez, 234 S.W.3d 90, 93 (Tex. App.--El Paso 2007, no pet.); Gonzalez v. Tippit, 167 S.W.3d 536, 544 (Tex. App.--Austin 2005, no pet.) ("An order affecting child support, however, is not easily overturned; the complaining party must show a clear abuse of discretion.") (citing Worford v. Stamper, 801 S.W.2d 108, 109 (Tex. 1990)). A trial court abuses its discretion when it acts without reference to any guiding rules and principles. Downer v. Aquamarine Operators, Inc., 701 S.W.2d 238, 241-42 (Tex. 1985).
When, as here, the sufficiency of the evidence and abuse of discretion standards of review both apply, we employ an hybrid analysis. See Tippit, 167 S.W.3d at 544 (citing In re Estate of King, 244 S.W.2d 660, 660 (Tex. 1951)). We engage in a two-pronged inquiry:
(1) whether the trial court had sufficient information upon which to exercise its discretion; and (2) whether the trial court erred in its application of discretion by making a decision that was arbitrary or unreasonable based on the evidence elicited. Id.
The first prong incorporates traditional sufficiency review. Id. Because Neal did not request findings of fact and conclusions of law, we must affirm the trial court's judgment if it can be upheld on any legal theory supported by the evidence. See Pedregon, 234 S.W.3d at 92.
Section 157.008 of the family code provides the required elements that an obligor must establish in order to be entitled to an offset in an enforcement action for child support arrearage:
(a) An obligor may plead as an affirmative defense in whole or in part to a motion for enforcement of child support that the obligee voluntarily relinquished to the obligor actual possession and control of a child.
(b) The voluntary relinquishment must have been for a time period in excess of any court-ordered periods of possession of and access to the child and actual support must have been supplied by the obligor.
* * *
(d) An obligor who has provided actual support to the child during a time subject to an affirmative defense under this section may request reimbursement for that support as a counterclaim or offset against the claim of the obligee.
Tex. Fam. Code Ann. § 157.008; see also In the Interest of A.M., 192 S.W.3d 570, 574 (Tex. 2006).
The burden was on Neal, as the obligor, to prove the duration of excess periods of possession and that he provided actual support to A.F.N. during those periods to be entitled to an offset. See Tex. Fam. Code Ann. § 157.006 (West 2002) (burden of proof on respondent to prove affirmative defense to motion for enforcement).
At trial, the parties disputed the length of time that Neal had possession of A.F.N. and the amount of support that Neal provided to A.F.N. during periods of time when he had possession. (5) Neal testified that A.F.N. lived with him for approximately eight years--from the time A.F.N. was in the first grade through the end of A.F.N.'s eighth grade school year (6)--and that he had an agreement with Upton that he was not obligated to pay child support during that time period. (7) He testified that he and A.F.N. lived with his girlfriend and her daughter during the time that he was taking care of A.F.N. and that he provided A.F.N. with money for his school lunches and fed him. (8)
Upton, in contrast, testified that there was never a time when A.F.N. stayed with Neal Monday through Friday on a regular basis except for a couple of months when A.F.N. was in sixth grade and that during those months, she paid for food, clothing, rent, health insurance, uninsured medical costs, and "anything [A.F.N.] needed." She was not sure what Neal paid for during those months, but she was "sure [Neal] gave [A.F.N.] money" for school lunches. She also testified that at one point, she and Neal tried a three-day rotation at each house but "that didn't work out very long either."
A.F.N., who was eighteen at the time of the trial, provided further inconsistent testimony. He testified he did not recall a period of time when he lived primarily with his father, but that from the time he was nine until his freshman year in high school, he rotated three days with his father and then three days with his mother and, thereafter, he lived with his mother. A.F.N. testified that Neal gave him lunch money on the days he was at Neal's house and provided him with clothes and school supplies and that he had his own room at Neal's girlfriend's house.
Presented with this conflicting evidence, it was for the trial court to resolve the inconsistencies and to determine which witness or witnesses to believe. See McGalliard v. Kuhlmann, 722 S.W.2d 694, 697 (Tex. 1986). Based on the evidence before it, the trial court could have credited Upton's testimony that A.F.N. only lived with Neal for two months in excess of his court-ordered periods of possession, A.F.N.'s testimony that he did not recall a time when he lived primarily with his father, and the accrual of child support prior to A.F.N.'s entry into first grade to support a much lower offset than the trial court found. Given the conflicting evidence, Neal cannot show as a matter of law or by the great weight and preponderance of the evidence that he was entitled to a complete or greater offset than he received from the trial court. (9) See Pedregon, 234 S.W.3d at 92-93. We conclude that there was sufficient information on which the trial court exercised its discretion in determining that Neal was not entitled to a complete or greater offset and that the trial court's decision was not arbitrary or unreasonable based upon the evidence elicited. See Tippit, 167 S.W.3d at 544.
CONCLUSION
Because we conclude the trial court did not err by failing to offset Neal's child support arrearage completely or in an amount greater than the amount of offset that it allowed, we overrule Neal's issue and affirm the trial court's judgment.
__________________________________________
Jan P. Patterson, Justice
Before Justices Patterson, Puryear and Henson
Affirmed
Filed: March 5, 2008
1. The record shows that Neal made child support payments from September 1991 until May 1993, from February 1994 until May 1995, and after 2004. He testified that he resumed payments because A.F.N. stopped living with him after his eighth grade school year and began living with Upton. Neal testified that he was unemployed from 1993 through the time of trial and that his girlfriend supported him.
2. Neal did not seek reimbursement at trial and does not claim entitlement to reimbursement on appeal.
3. The trial court also ordered Neal to pay $150 in attorney's fees to the OAG, and held Neal in contempt for failure to pay child support. Neal challenges only the arrearage judgment on appeal.
4. Neal did not plead that he was entitled to an offset because of his earning capacity, and the statute does not include earning capacity as a ground for offset. See Tex. Fam. Code Ann. § 157.008 (West 2002). Earning capacity is relevant on the issues of contempt and violation of community service, but Neal does not challenge the contempt portion of the judgment. See id. § 157.008(c).
5. The supreme court has addressed the evidence that is required to establish the actual support element. See In the Interest of A.M., 192 S.W.3d 570, 574 (Tex. 2006). In that case, it was undisputed that the obligor solely supported his children during his period of excess possession. Id. at 575. The supreme court held that the court of appeals "could reasonably presume, as it did, that during the period of excess possession [the obligor] was entitled to equate his monthly child support obligation to the actual support he provided each child." Id. at 576. In contrast, the parties dispute when and how much support Neal provided to A.F.N. See Pedregon v. Sanchez, 234 S.W.3d 90, 96 (Tex. App.--El Paso 2007, no pet.) ("[O]bligor must provide some evidence of the amount of actual support paid when the evidence establishes that the obligor did not solely support the child. This would enable the trial court to determine the amount of a proper offset.").
6. Neal's testimony that A.F.N. lived with him was inconsistent with his responses to interrogatories. When asked to identify dates on which he exercised possession of A.F.N. since 1990, Neal stated "[A.F.N.] split his time 50-50 between my house and his mother."
7. Neal contended that Upton signed a written agreement on the back of a magazine releasing Neal from his obligation to pay child support to her. Upton denied signing such an agreement, and Neal did not offer a written agreement. Even if the parties reached an alternative arrangement on child support, the approval of the court was required. See Tex. Fam. Code Ann. § 154.124 (West 2002).
8. Neal also called his girlfriend's daughter, one of the daughter's friends, and a friend of A.F.N. as witnesses. The three witnesses testified to time periods that they believed that A.F.N. lived with Neal. Neal contends that the trial court erred in ignoring this testimony, but it was the trial court's role, as the fact finder, to determine the weight to be given to the testimony. See McGalliard v. Kuhlmann, 722 S.W.2d 694, 697 (Tex. 1986).
9. After the testimony concluded, Neal's counsel even suggested to the trial court partially offsetting the amount owed as an alternative to an entire offset:
Well, Judge, if you look at the money that's owed, I believe 30,000 is interest so the Court could decide to waive all the interest. And then the Court could decide to split the remaining balance in half since the testimony is somewhat of a 50/50-type of arrangement. That is an alternative.
The trial court thereafter accepted this alternative, offsetting approximately half of the outstanding child support that Neal owed to Upton.
Appeal from 200th District Court of Travis County
FROM THE DISTRICT COURT OF TRAVIS COUNTY, 200TH JUDICIAL DISTRICT
NO. D-1-FM-90-488,147, HONORABLE WILLIAM E. BENDER, JUDGE PRESIDING
M E M O R A N D U M O P I N I O N
Appellant Gary Neal appeals an order of enforcement for child support arrearage brought by appellee the Office of the Attorney General ("OAG") on behalf of appellee Lyn L. Upton for the support of A.F.N., a child. The OAG sought approximately $82,000 in arrearage, and the trial court granted a judgment for $41,000. In a single issue, Neal contends the trial court erred by failing to offset the child support arrearage completely because Upton voluntarily relinquished actual possession and control of A.F.N. to Neal for approximately eight years. See Tex. Fam. Code Ann. § 157.008 (West 2002). For the reasons that follow, we overrule Neal's issue and affirm the trial court's judgment.
BACKGROUND
Neal and Upton were divorced in 1990. Upton was appointed sole managing conservator of their child, A.F.N., Neal was appointed possessory conservator, and Neal was ordered to make monthly child support payments to Upton of $377 until A.F.N. turned eighteen. In March 2005, the OAG filed a motion for enforcement seeking a money judgment for child support arrearage of approximately $82,000. (1) Neal answered, pleading an affirmative defense that he was entitled to offset or reimbursement against the arrearage. (2) His defense was that he should not have to pay the arrearage because he took care of A.F.N. for periods of time in excess of his court-ordered periods of possession. See id.
At a bench trial in December 2006 on the motion for enforcement, Upton, Neal, and A.F.N. were among the witnesses to testify, and their testimony directly conflicted. Although Neal did not dispute the amount of accrued court-ordered child support, Neal testified that A.F.N. lived with him from the time A.F.N. was in first grade through the end of A.F.N.'s eighth grade school year.
Upton, in contrast, testified that A.F.N. lived with her and not with Neal during those years except for brief periods of time. A.F.N. testified that from the time he was nine years of age until high school, he rotated between his parents every three days and that he lived with his mother in high school. The parties also testified inconsistently as to the amount of support that Neal provided A.F.N. during the alleged periods of time that Neal was taking care of A.F.N.
At the conclusion of the testimony, the trial court found that Neal was entitled to an offset of approximately half of the accrued child support that the OAG sought in the enforcement action and granted a $41,000 arrearage judgment against Neal. (3) This appeal followed.
ANALYSIS
In one issue, Neal contends that the trial court erred in not "allowing a complete offset of his child support arrearage where the evidence showed that during the accrual of the arrearage [Neal] had possession of the child in excess of court-ordered visitation periods." He seeks a partial remand for the trial court to determine whether he should have to pay the $41,000 judgment, "taking into account the evidence of [his] possession of the child and [his] earning capacity." (4) Neal in effect attacks the legal and factual sufficiency of the evidence to support the trial court's judgment.
In determining whether a finding is supported by legally sufficient evidence, we view the evidence in the light most favorable to the finding, "crediting favorable evidence if reasonable jurors could, and disregarding contrary evidence unless reasonable jurors could not." City of Keller v. Wilson, 168 S.W.3d 802, 807 (Tex. 2005). We indulge every reasonable inference that would support the finding. Id. at 822. In reviewing the factual sufficiency of the evidence, we consider and weigh all the evidence presented at trial, including any evidence contrary to the judgment. Plas-Tex, Inc. v. U.S. Steel Corp., 772 S.W.2d 442, 445 (Tex. 1989); Cain v. Bain, 709 S.W.2d 175, 176 (Tex. 1986). We set aside a finding for factual insufficiency if it is "so contrary to the overwhelming weight of the evidence as to be clearly wrong and unjust." Cain, 709 S.W.2d at 176.
We review arrearage judgments for child support under an abuse of discretion standard. See Pedregon v. Sanchez, 234 S.W.3d 90, 93 (Tex. App.--El Paso 2007, no pet.); Gonzalez v. Tippit, 167 S.W.3d 536, 544 (Tex. App.--Austin 2005, no pet.) ("An order affecting child support, however, is not easily overturned; the complaining party must show a clear abuse of discretion.") (citing Worford v. Stamper, 801 S.W.2d 108, 109 (Tex. 1990)). A trial court abuses its discretion when it acts without reference to any guiding rules and principles. Downer v. Aquamarine Operators, Inc., 701 S.W.2d 238, 241-42 (Tex. 1985).
When, as here, the sufficiency of the evidence and abuse of discretion standards of review both apply, we employ an hybrid analysis. See Tippit, 167 S.W.3d at 544 (citing In re Estate of King, 244 S.W.2d 660, 660 (Tex. 1951)). We engage in a two-pronged inquiry:
(1) whether the trial court had sufficient information upon which to exercise its discretion; and (2) whether the trial court erred in its application of discretion by making a decision that was arbitrary or unreasonable based on the evidence elicited. Id.
The first prong incorporates traditional sufficiency review. Id. Because Neal did not request findings of fact and conclusions of law, we must affirm the trial court's judgment if it can be upheld on any legal theory supported by the evidence. See Pedregon, 234 S.W.3d at 92.
Section 157.008 of the family code provides the required elements that an obligor must establish in order to be entitled to an offset in an enforcement action for child support arrearage:
(a) An obligor may plead as an affirmative defense in whole or in part to a motion for enforcement of child support that the obligee voluntarily relinquished to the obligor actual possession and control of a child.
(b) The voluntary relinquishment must have been for a time period in excess of any court-ordered periods of possession of and access to the child and actual support must have been supplied by the obligor.
* * *
(d) An obligor who has provided actual support to the child during a time subject to an affirmative defense under this section may request reimbursement for that support as a counterclaim or offset against the claim of the obligee.
Tex. Fam. Code Ann. § 157.008; see also In the Interest of A.M., 192 S.W.3d 570, 574 (Tex. 2006).
The burden was on Neal, as the obligor, to prove the duration of excess periods of possession and that he provided actual support to A.F.N. during those periods to be entitled to an offset. See Tex. Fam. Code Ann. § 157.006 (West 2002) (burden of proof on respondent to prove affirmative defense to motion for enforcement).
At trial, the parties disputed the length of time that Neal had possession of A.F.N. and the amount of support that Neal provided to A.F.N. during periods of time when he had possession. (5) Neal testified that A.F.N. lived with him for approximately eight years--from the time A.F.N. was in the first grade through the end of A.F.N.'s eighth grade school year (6)--and that he had an agreement with Upton that he was not obligated to pay child support during that time period. (7) He testified that he and A.F.N. lived with his girlfriend and her daughter during the time that he was taking care of A.F.N. and that he provided A.F.N. with money for his school lunches and fed him. (8)
Upton, in contrast, testified that there was never a time when A.F.N. stayed with Neal Monday through Friday on a regular basis except for a couple of months when A.F.N. was in sixth grade and that during those months, she paid for food, clothing, rent, health insurance, uninsured medical costs, and "anything [A.F.N.] needed." She was not sure what Neal paid for during those months, but she was "sure [Neal] gave [A.F.N.] money" for school lunches. She also testified that at one point, she and Neal tried a three-day rotation at each house but "that didn't work out very long either."
A.F.N., who was eighteen at the time of the trial, provided further inconsistent testimony. He testified he did not recall a period of time when he lived primarily with his father, but that from the time he was nine until his freshman year in high school, he rotated three days with his father and then three days with his mother and, thereafter, he lived with his mother. A.F.N. testified that Neal gave him lunch money on the days he was at Neal's house and provided him with clothes and school supplies and that he had his own room at Neal's girlfriend's house.
Presented with this conflicting evidence, it was for the trial court to resolve the inconsistencies and to determine which witness or witnesses to believe. See McGalliard v. Kuhlmann, 722 S.W.2d 694, 697 (Tex. 1986). Based on the evidence before it, the trial court could have credited Upton's testimony that A.F.N. only lived with Neal for two months in excess of his court-ordered periods of possession, A.F.N.'s testimony that he did not recall a time when he lived primarily with his father, and the accrual of child support prior to A.F.N.'s entry into first grade to support a much lower offset than the trial court found. Given the conflicting evidence, Neal cannot show as a matter of law or by the great weight and preponderance of the evidence that he was entitled to a complete or greater offset than he received from the trial court. (9) See Pedregon, 234 S.W.3d at 92-93. We conclude that there was sufficient information on which the trial court exercised its discretion in determining that Neal was not entitled to a complete or greater offset and that the trial court's decision was not arbitrary or unreasonable based upon the evidence elicited. See Tippit, 167 S.W.3d at 544.
CONCLUSION
Because we conclude the trial court did not err by failing to offset Neal's child support arrearage completely or in an amount greater than the amount of offset that it allowed, we overrule Neal's issue and affirm the trial court's judgment.
__________________________________________
Jan P. Patterson, Justice
Before Justices Patterson, Puryear and Henson
Affirmed
Filed: March 5, 2008
1. The record shows that Neal made child support payments from September 1991 until May 1993, from February 1994 until May 1995, and after 2004. He testified that he resumed payments because A.F.N. stopped living with him after his eighth grade school year and began living with Upton. Neal testified that he was unemployed from 1993 through the time of trial and that his girlfriend supported him.
2. Neal did not seek reimbursement at trial and does not claim entitlement to reimbursement on appeal.
3. The trial court also ordered Neal to pay $150 in attorney's fees to the OAG, and held Neal in contempt for failure to pay child support. Neal challenges only the arrearage judgment on appeal.
4. Neal did not plead that he was entitled to an offset because of his earning capacity, and the statute does not include earning capacity as a ground for offset. See Tex. Fam. Code Ann. § 157.008 (West 2002). Earning capacity is relevant on the issues of contempt and violation of community service, but Neal does not challenge the contempt portion of the judgment. See id. § 157.008(c).
5. The supreme court has addressed the evidence that is required to establish the actual support element. See In the Interest of A.M., 192 S.W.3d 570, 574 (Tex. 2006). In that case, it was undisputed that the obligor solely supported his children during his period of excess possession. Id. at 575. The supreme court held that the court of appeals "could reasonably presume, as it did, that during the period of excess possession [the obligor] was entitled to equate his monthly child support obligation to the actual support he provided each child." Id. at 576. In contrast, the parties dispute when and how much support Neal provided to A.F.N. See Pedregon v. Sanchez, 234 S.W.3d 90, 96 (Tex. App.--El Paso 2007, no pet.) ("[O]bligor must provide some evidence of the amount of actual support paid when the evidence establishes that the obligor did not solely support the child. This would enable the trial court to determine the amount of a proper offset.").
6. Neal's testimony that A.F.N. lived with him was inconsistent with his responses to interrogatories. When asked to identify dates on which he exercised possession of A.F.N. since 1990, Neal stated "[A.F.N.] split his time 50-50 between my house and his mother."
7. Neal contended that Upton signed a written agreement on the back of a magazine releasing Neal from his obligation to pay child support to her. Upton denied signing such an agreement, and Neal did not offer a written agreement. Even if the parties reached an alternative arrangement on child support, the approval of the court was required. See Tex. Fam. Code Ann. § 154.124 (West 2002).
8. Neal also called his girlfriend's daughter, one of the daughter's friends, and a friend of A.F.N. as witnesses. The three witnesses testified to time periods that they believed that A.F.N. lived with Neal. Neal contends that the trial court erred in ignoring this testimony, but it was the trial court's role, as the fact finder, to determine the weight to be given to the testimony. See McGalliard v. Kuhlmann, 722 S.W.2d 694, 697 (Tex. 1986).
9. After the testimony concluded, Neal's counsel even suggested to the trial court partially offsetting the amount owed as an alternative to an entire offset:
Well, Judge, if you look at the money that's owed, I believe 30,000 is interest so the Court could decide to waive all the interest. And then the Court could decide to split the remaining balance in half since the testimony is somewhat of a 50/50-type of arrangement. That is an alternative.
The trial court thereafter accepted this alternative, offsetting approximately half of the outstanding child support that Neal owed to Upton.
Was defendant charged with arson competent to stand trial?
Arson defendant's legal competency unclear - appeal abated for judicial determination of competency to stand trial.
Quentin Paul Freeman, Sr. v. The State of Texas, NO. 03-05-00659-CR (Tex.App.- Austin, Mar. 5, 2008)(Opinion by Justice Henson) (competency of defendant to be determined judicially) (Before Justices Patterson, Puryear and Henson)
Appeal from 21st District Court of Bastrop County
M E M O R A N D U M O P I N I O N
Quentin Paul Freeman, Sr., appeals his conviction for arson of a habitation, a first-degree felony. See Tex. Penal Code Ann. §§ 28.02(a)(2), (d)(2) (West Supp. 2007). In three issues, Freeman complains that he was put to trial after having been found incompetent, violating his due process rights; that the trial court's sua sponte substitution of his counsel without good cause violated his right to counsel; and that he received ineffective assistance of counsel.
The State responds that, due to a clerical error, copies of three documents relating to Freeman's competency were not filed with the trial court in this case, having been accidentally filed in duplicate in another pending case against Freeman, cause number 11,005. These documents include the official report issued by Dr. Joseph Black of Vernon's State Hospital giving notice that Freeman had received treatment and was now competent to stand trial; a psychological evaluation from the hospital's chief psychologist, Dr. B. Thomas Gray, indicating that Freeman had engaged in "feigning and exaggeration" in order to appear incompetent to stand trial; and the follow-up report of the court-appointed psychiatrist, Dr. Susan Stone, who had originally found Freeman incompetent but now determined that he was competent to stand trial.
In light of the evidence of Freeman's competency, the State argues that, while there is no record of the trial court's finding that Freeman had regained competency, the proper procedure is to abate Freeman's appeal to allow the trial court to make the necessary finding on the record. See Schaffer v. State, 583 S.W.2d 627, 630 (Tex. Crim. App. [Panel Op.] 1979) (op. on reh'g); Bradford v. State, 172 S.W.3d 1, 6 (Tex. App.--Fort Worth 2005, no pet.). See also Johnson v. State, Nos. 2-05-205-CR, 2-05-206-CR, 2006 Tex. App. LEXIS 8020, at *21 (Tex. App.--Fort Worth June 22, 2006, no writ) (not designated for publication).
Letters from a psychiatrist or psychiatric evaluations containing recitations of competency are evidentiary only; they cannot operate as a substitute for a judicial determination of a defendant's competency to stand trial. Bell v. State, 814 S.W.2d 229, 232 (Tex. App.--Houston [1st Dist.] 1991, pet. ref'd). Instead, the record must contain a judgment, order, docket entry, or other evidence that the trial court actually made a determination of competency. Schaffer, 583 S.W.2d at 631. As the State concedes, the record in this case contains no such determination.
The appeal is abated and the cause remanded to the trial court for a judicial determination regarding Freeman's competency at the time of his trial. See id. at 630; Fuller v. State, 11 S.W.3d 393, 395 (Tex. App.--Texarkana 2000, order), disp. on merits, 30 S.W.3d 441 (Tex. App.--Texarkana 2000, pet. ref'd). A supplemental record containing these findings shall be tendered to the Clerk of this Court for filing no later than forty-five days following the date of this opinion. If the parties thereafter choose to supplement their briefing, appellant Freeman will have thirty days to file a supplemental brief raising any points of error challenging the trial court's findings, and the State will have the same amount of time to file a responsive brief.
__________________________________________
Diane Henson, Justice
Before Justices Patterson, Puryear and Henson
Abated
Filed: March 5, 2008
Quentin Paul Freeman, Sr. v. The State of Texas, NO. 03-05-00659-CR (Tex.App.- Austin, Mar. 5, 2008)(Opinion by Justice Henson) (competency of defendant to be determined judicially) (Before Justices Patterson, Puryear and Henson)
Appeal from 21st District Court of Bastrop County
M E M O R A N D U M O P I N I O N
Quentin Paul Freeman, Sr., appeals his conviction for arson of a habitation, a first-degree felony. See Tex. Penal Code Ann. §§ 28.02(a)(2), (d)(2) (West Supp. 2007). In three issues, Freeman complains that he was put to trial after having been found incompetent, violating his due process rights; that the trial court's sua sponte substitution of his counsel without good cause violated his right to counsel; and that he received ineffective assistance of counsel.
The State responds that, due to a clerical error, copies of three documents relating to Freeman's competency were not filed with the trial court in this case, having been accidentally filed in duplicate in another pending case against Freeman, cause number 11,005. These documents include the official report issued by Dr. Joseph Black of Vernon's State Hospital giving notice that Freeman had received treatment and was now competent to stand trial; a psychological evaluation from the hospital's chief psychologist, Dr. B. Thomas Gray, indicating that Freeman had engaged in "feigning and exaggeration" in order to appear incompetent to stand trial; and the follow-up report of the court-appointed psychiatrist, Dr. Susan Stone, who had originally found Freeman incompetent but now determined that he was competent to stand trial.
In light of the evidence of Freeman's competency, the State argues that, while there is no record of the trial court's finding that Freeman had regained competency, the proper procedure is to abate Freeman's appeal to allow the trial court to make the necessary finding on the record. See Schaffer v. State, 583 S.W.2d 627, 630 (Tex. Crim. App. [Panel Op.] 1979) (op. on reh'g); Bradford v. State, 172 S.W.3d 1, 6 (Tex. App.--Fort Worth 2005, no pet.). See also Johnson v. State, Nos. 2-05-205-CR, 2-05-206-CR, 2006 Tex. App. LEXIS 8020, at *21 (Tex. App.--Fort Worth June 22, 2006, no writ) (not designated for publication).
Letters from a psychiatrist or psychiatric evaluations containing recitations of competency are evidentiary only; they cannot operate as a substitute for a judicial determination of a defendant's competency to stand trial. Bell v. State, 814 S.W.2d 229, 232 (Tex. App.--Houston [1st Dist.] 1991, pet. ref'd). Instead, the record must contain a judgment, order, docket entry, or other evidence that the trial court actually made a determination of competency. Schaffer, 583 S.W.2d at 631. As the State concedes, the record in this case contains no such determination.
The appeal is abated and the cause remanded to the trial court for a judicial determination regarding Freeman's competency at the time of his trial. See id. at 630; Fuller v. State, 11 S.W.3d 393, 395 (Tex. App.--Texarkana 2000, order), disp. on merits, 30 S.W.3d 441 (Tex. App.--Texarkana 2000, pet. ref'd). A supplemental record containing these findings shall be tendered to the Clerk of this Court for filing no later than forty-five days following the date of this opinion. If the parties thereafter choose to supplement their briefing, appellant Freeman will have thirty days to file a supplemental brief raising any points of error challenging the trial court's findings, and the State will have the same amount of time to file a responsive brief.
__________________________________________
Diane Henson, Justice
Before Justices Patterson, Puryear and Henson
Abated
Filed: March 5, 2008
Failure to meet filing deadline (and failure to take advantage of grace period) proves fatal to appeal
The Gaylord Skinner Trust, Gaylord Skinner and Ricki Don Skinner v. Nathan Minchey and Gretchen E. Minchey, No. 03-08-00073-CV (Tex.App.- Austin, Mar. 4, 2008)(Opinion by Justice Pemberton) (untimely notice of appeal, DWOJ, jurisdictional dismissal) (Before Chief Justice Law, Justices Pemberton and Waldrop)
Appeal from 353rd District Court of Travis County
M E M O R A N D U M O P I N I O N
On February 1, 2008, appellants The Gaylord Skinner Trust, Gaylord Skinner and Ricki Don Skinner filed their notice of appeal and a motion to extend time to file their notice of appeal. On February 8, 2008, appellees Nathan Minchey and Gretchen E. Minchey filed a motion to dismiss for want of jurisdiction. The Mincheys contend that the Skinners failed to file their notice of appeal and their motion for extension of time within the time prescribed under rule 26 of the rules of appellate procedure. See Tex. R. App. P. 26.
If any party timely files a motion for new trial, the notice of appeal must be filed within 90 days after the trial court's judgment is signed. Tex. R. App. P. 26.1(a)(1). The appellate court may extend the time to file the notice of appeal if, within 15 days after the deadline for filing the notice of appeal, the party files in the trial court the notice of appeal and files in the appellate court a motion to extend time complying with Rule 10.5(b). Tex. R. App. P. 26.3.
The district court's judgment was signed on October 15, 2007. The Skinners timely filed a motion for new trial on November 14, 2007. Therefore, the Skinners' notice of appeal was due on January 14, 2008. See Tex. R. App. P. 4.1(a), 26.1(a)(1). The Skinners' motion to extend time to file their notice of appeal was due on January 29, 2008. See Tex. R. App. P. 26.3.
"[O]nce the period for granting a motion for extension of time under Rule [26.3] has passed, a party can no longer invoke the appellate court's jurisdiction." Verburgt v. Dorner, 959 S.W.2d 615, 617 (Tex. 1997). The Skinners did not file their notice of appeal and motion for extension of time until after January 29, 2008. Therefore, they failed to invoke our jurisdiction. Accordingly, we overrule the Skinners' motion for extension of time, grant the Mincheys' motion to dismiss, and dismiss this appeal for want of jurisdiction. (1) See Tex. R. App. P. 42.3(a).
____________________________________
Bob Pemberton, Justice
Before Chief Justice Law, Justices Pemberton and Waldrop
Dismissed for Want of Jurisdiction
Filed: March 4, 2008
1. The Skinners have also filed a motion to extend time to file the clerk's record. In light of our dismissal of this appeal, we dismiss this motion as moot.
Appeal from 353rd District Court of Travis County
M E M O R A N D U M O P I N I O N
On February 1, 2008, appellants The Gaylord Skinner Trust, Gaylord Skinner and Ricki Don Skinner filed their notice of appeal and a motion to extend time to file their notice of appeal. On February 8, 2008, appellees Nathan Minchey and Gretchen E. Minchey filed a motion to dismiss for want of jurisdiction. The Mincheys contend that the Skinners failed to file their notice of appeal and their motion for extension of time within the time prescribed under rule 26 of the rules of appellate procedure. See Tex. R. App. P. 26.
If any party timely files a motion for new trial, the notice of appeal must be filed within 90 days after the trial court's judgment is signed. Tex. R. App. P. 26.1(a)(1). The appellate court may extend the time to file the notice of appeal if, within 15 days after the deadline for filing the notice of appeal, the party files in the trial court the notice of appeal and files in the appellate court a motion to extend time complying with Rule 10.5(b). Tex. R. App. P. 26.3.
The district court's judgment was signed on October 15, 2007. The Skinners timely filed a motion for new trial on November 14, 2007. Therefore, the Skinners' notice of appeal was due on January 14, 2008. See Tex. R. App. P. 4.1(a), 26.1(a)(1). The Skinners' motion to extend time to file their notice of appeal was due on January 29, 2008. See Tex. R. App. P. 26.3.
"[O]nce the period for granting a motion for extension of time under Rule [26.3] has passed, a party can no longer invoke the appellate court's jurisdiction." Verburgt v. Dorner, 959 S.W.2d 615, 617 (Tex. 1997). The Skinners did not file their notice of appeal and motion for extension of time until after January 29, 2008. Therefore, they failed to invoke our jurisdiction. Accordingly, we overrule the Skinners' motion for extension of time, grant the Mincheys' motion to dismiss, and dismiss this appeal for want of jurisdiction. (1) See Tex. R. App. P. 42.3(a).
____________________________________
Bob Pemberton, Justice
Before Chief Justice Law, Justices Pemberton and Waldrop
Dismissed for Want of Jurisdiction
Filed: March 4, 2008
1. The Skinners have also filed a motion to extend time to file the clerk's record. In light of our dismissal of this appeal, we dismiss this motion as moot.
Mediated Settlement Agreement (MSA) Stands
Second thoughts on fairness of divorce property settlement upon realization of effects of divorce on health benefits did provide sufficient grounds to set aside mediated settlement agreement (MSA) that complied with Family Code requirements and entitled either party to judgment. Unconscionability and mutual mistake arguments rejected.
Elsie B. Kott v. Clayton Herman Kott, No. 03-06-00398-CV (Tex.App.- Austin, Feb. 29, 2008) (Opinion by Justice Pemberton ) (family law, divorce, mediated settlement agreement) (Before Justices Patterson, Pemberton and Waldrop)
Appeal from County Court at Law of Bastrop County
M E M O R A N D U M O P I N I O N
Appellant, Elsie B. Kott, appeals from a final decree of divorce that incorporated a mediated settlement agreement between herself and appellee, Clayton Herman Kott. Elsie (1) appeals from the decree, bringing three issues challenging the validity or enforceability of the underlying mediated settlement agreement: (1) the court lacked authority to order mediation; (2) the settlement agreement is so vague that it is incapable of implementation or enforcement; and (3) the settlement agreement is substantively unconscionable. We will affirm the judgment.
Of her three appellate issues, Elsie preserved only her substantive unconscionability complaint by raising it in the trial court. See Tex. R. App. P. 33.1. Regarding her single preserved issue, Elsie asserts that, by divorcing Clayton, she lost her medical coverage as the spouse of a disabled veteran, that neither party had been aware of that implication under federal law when negotiating the mediated settlement agreement, and that she would not have agreed to the property division with that awareness. She urges that the property division, considering her loss of medical benefits, "became substantively unconscionable."
Section 6.602 of the family code provides that, in a suit for dissolution of a marriage, a mediated settlement agreement is binding on the parties if it "(1) provides, in a prominently displayed statement that is in boldfaced type or capital letters or underlined, that the agreement is not subject to revocation; (2) is signed by each party to the agreement; and (3) is signed by the party's attorney, if any, who is present at the time the agreement is signed." Tex. Fam. Code Ann. § 6.602(b) (West 2006). The parties' agreement here meets these requirements. Both parties signed the instrument, both parties' counsel signed it, and the agreement contained the following provision immediately above the signature lines (emphasis as in original):
15. BINDING AGREEMENT
THIS AGREEMENT CONSTITUTES A BINDING MEDIATED SETTLEMENT AGREEMENT. IT HAS BEEN REVIEWED BY BOTH PARTIES AND THEIR ATTORNEYS. THIS AGREEMENT WILL BE FILED WITH THE COURT AND IS NOT SUBJECT TO REVOCATION.
The legislature has mandated that "[i]f a mediated settlement agreement meets the requirements of this section, a party is entitled to judgment on the mediated settlement agreement notwithstanding Rule 11, Texas Rules of Civil Procedure, or another rule of law." Id. § 6.602(c). Thus, settlement agreements complying with section 6.602 are immediately enforceable, are not subject to repudiation by a party, and are binding on the trial court without condition of judicial approval or determination of whether the agreement's terms are just and right. See Cayan v. Cayan, 38 S.W.3d 161, 164-66 (Tex. App.--Houston [14th Dist.] 2000, pet. denied); cf. Tex. Fam. Code. Ann. § 7.006 (West 2006).
On the other hand, courts of appeals, including this Court, have recognized some defenses to the enforceability of section 6.602-compliant mediated settlement agreements. See Spiegel v. KLRU Endowment Fund, 228 S.W.3d 237, 242 (Tex. App.--Austin 2007, pet. denied) (where mediated settlement agreement meets section 6.602's requirements, "it must be enforced in the absence of allegations that the agreement calls for the performance of an illegal act or that it was 'procured by fraud, duress, coercion, or other dishonest means.'") (quoting Boyd v. Boyd, 67 S.W.3d 398, 403 (Tex. App.--Fort Worth 2002, no pet.)); see also Mullins v. Mullins, 202 S.W.3d 869, 877 (Tex. App.--Dallas 2006, pet. denied) (appearing to assume that "mistake" or the absence of a "meeting of the minds" would be a ground for rescinding a mediated settlement agreement).
In the trial court, Elsie complained principally that the mediated settlement agreement was predicated upon mutual mistake. After executing the mediated settlement agreement but prior to entry of judgment, Elsie obtained new counsel and sought to set aside the agreement on the sole ground of mutual mistake.
At the hearing on entry of the decree, Elsie gave brief testimony to the effect that she had been unaware that she would lose her medical coverage as the spouse of a disabled veteran and would not have agreed to the property division had she comprehended those implications. (2) During a short cross-examination, Clayton's counsel elicited Elsie's acknowledgment that she had been represented by counsel during the mediation, that the parties had an experienced mediator, and that the mediation had been "lengthy." (3) Elsie did not assert or present evidence that the agreement called for performance of an illegal act or that it was obtained through fraud, duress, coercion, or dishonesty. At the conclusion of the hearing, the trial court stated on the record that it "finds that the Mediated Settlement Agreement was the result of an arms-length negotiation, and represents their agreement, which will be accepted by the Court," and proceeded to render judgment on the decree.
Elsie subsequently filed a motion for new trial, re-urging her arguments regarding mistake. She added that the "the terms of the property settlement provision of the mediated settlement agreement is not a just and equitable division of the property of the parties unless Mrs. Kott retains her military medical benefits and to require her to live with this 'bargain' would be unconscionable." This new trial motion was overruled by operation of law.
We conclude that Elsie's attempt to challenge the fairness, standing alone, of the terms of a mediated settlement agreement complying with section 6.602 has been foreclosed by the legislature. See Tex. Fam. Code Ann. § 6.602(c) ("If a mediated settlement agreement meets the requirements of this section, a party is entitled to judgment on the mediated settlement agreement notwithstanding Rule 11, Texas Rules of Civil Procedure, or another rule of law."); Cayan, 38 S.W.3d at 164-66 & n.8 (section 6.602 agreements are not subject to a just and right determination by the trial court; to conclude otherwise "would suggest that the trial court retains discretion to reject such an agreement, request the parties to negotiate a different agreement and, if necessary, set the matter for hearing," all contrary to section 6.602(c)); see also Carson v. Carson, No. 03-04-00521-CV, 2005 Tex. App. LEXIS 9250, at *3 (Tex. App.--Austin Nov. 4, 2005, no pet.) (mem. op.) ("To the extent that [the appellant] seeks to disturb the contents of the [mediated settlement] agreement on appeal, these issues are barred by statute and the language of the agreement.").
To the extent Elsie's appellate issue regarding "substantive unconscionability" encompasses her trial-level contention regarding mutual mistake, the evidence is legally and factually sufficient to support the trial court's implied findings that she failed to prove that defense. (4) Mullins, 202 S.W.3d at 877; see also Carson, 2005 Tex. App. LEXIS 9250, at *2-3 (rejecting challenge that party "was not fully informed of the financial implications of the agreed upon distribution of property," observing that party was represented by counsel and the mediated settlement agreement "meets all statutory requirements to be binding on the parties"). We observe again that Elsie has not claimed that the mediated settlement agreement was the product of coercion, duress, or fraud.
For these reasons, we overrule Elsie's appellate issues and affirm the trial court's judgment.
____________________________________________
Bob Pemberton, Justice
Before Justices Patterson, Pemberton and Waldrop
Affirmed
Filed: February 29, 2008
1. To avoid confusion from the common surname, we will refer to the parties by their first names.
2. Elsie's sole direct testimony on this point was:
Q: And in the mediation did you request to be awarded those benefits?
A: No, because I had wanted to hand to my attorney papers stating what I wanted out of the divorce, and he wouldn't take it. So I got so flustered I didn't realize that we had not discussed my benefits being taken away if I got a divorce.
Q: Now, I understand your major concern is with your medical benefits through the military.
A: Yes.
Q: And if you were to retain those, you would be glad to go along with this [property] division?
A: Yes.
Q: But if you were going to lose those rights, then would you like for the court to give you another opportunity to negotiate this property?
A: Yes.
3. The record elsewhere reflects that the mediation had lasted all or most of a day. Clayton's counsel also emphasized that it had been Elsie who first filed for divorce.
4. Neither party requested written findings of fact and conclusions of law, and none were filed.
Elsie B. Kott v. Clayton Herman Kott, No. 03-06-00398-CV (Tex.App.- Austin, Feb. 29, 2008) (Opinion by Justice Pemberton ) (family law, divorce, mediated settlement agreement) (Before Justices Patterson, Pemberton and Waldrop)
Appeal from County Court at Law of Bastrop County
M E M O R A N D U M O P I N I O N
Appellant, Elsie B. Kott, appeals from a final decree of divorce that incorporated a mediated settlement agreement between herself and appellee, Clayton Herman Kott. Elsie (1) appeals from the decree, bringing three issues challenging the validity or enforceability of the underlying mediated settlement agreement: (1) the court lacked authority to order mediation; (2) the settlement agreement is so vague that it is incapable of implementation or enforcement; and (3) the settlement agreement is substantively unconscionable. We will affirm the judgment.
Of her three appellate issues, Elsie preserved only her substantive unconscionability complaint by raising it in the trial court. See Tex. R. App. P. 33.1. Regarding her single preserved issue, Elsie asserts that, by divorcing Clayton, she lost her medical coverage as the spouse of a disabled veteran, that neither party had been aware of that implication under federal law when negotiating the mediated settlement agreement, and that she would not have agreed to the property division with that awareness. She urges that the property division, considering her loss of medical benefits, "became substantively unconscionable."
Section 6.602 of the family code provides that, in a suit for dissolution of a marriage, a mediated settlement agreement is binding on the parties if it "(1) provides, in a prominently displayed statement that is in boldfaced type or capital letters or underlined, that the agreement is not subject to revocation; (2) is signed by each party to the agreement; and (3) is signed by the party's attorney, if any, who is present at the time the agreement is signed." Tex. Fam. Code Ann. § 6.602(b) (West 2006). The parties' agreement here meets these requirements. Both parties signed the instrument, both parties' counsel signed it, and the agreement contained the following provision immediately above the signature lines (emphasis as in original):
15. BINDING AGREEMENT
THIS AGREEMENT CONSTITUTES A BINDING MEDIATED SETTLEMENT AGREEMENT. IT HAS BEEN REVIEWED BY BOTH PARTIES AND THEIR ATTORNEYS. THIS AGREEMENT WILL BE FILED WITH THE COURT AND IS NOT SUBJECT TO REVOCATION.
The legislature has mandated that "[i]f a mediated settlement agreement meets the requirements of this section, a party is entitled to judgment on the mediated settlement agreement notwithstanding Rule 11, Texas Rules of Civil Procedure, or another rule of law." Id. § 6.602(c). Thus, settlement agreements complying with section 6.602 are immediately enforceable, are not subject to repudiation by a party, and are binding on the trial court without condition of judicial approval or determination of whether the agreement's terms are just and right. See Cayan v. Cayan, 38 S.W.3d 161, 164-66 (Tex. App.--Houston [14th Dist.] 2000, pet. denied); cf. Tex. Fam. Code. Ann. § 7.006 (West 2006).
On the other hand, courts of appeals, including this Court, have recognized some defenses to the enforceability of section 6.602-compliant mediated settlement agreements. See Spiegel v. KLRU Endowment Fund, 228 S.W.3d 237, 242 (Tex. App.--Austin 2007, pet. denied) (where mediated settlement agreement meets section 6.602's requirements, "it must be enforced in the absence of allegations that the agreement calls for the performance of an illegal act or that it was 'procured by fraud, duress, coercion, or other dishonest means.'") (quoting Boyd v. Boyd, 67 S.W.3d 398, 403 (Tex. App.--Fort Worth 2002, no pet.)); see also Mullins v. Mullins, 202 S.W.3d 869, 877 (Tex. App.--Dallas 2006, pet. denied) (appearing to assume that "mistake" or the absence of a "meeting of the minds" would be a ground for rescinding a mediated settlement agreement).
In the trial court, Elsie complained principally that the mediated settlement agreement was predicated upon mutual mistake. After executing the mediated settlement agreement but prior to entry of judgment, Elsie obtained new counsel and sought to set aside the agreement on the sole ground of mutual mistake.
At the hearing on entry of the decree, Elsie gave brief testimony to the effect that she had been unaware that she would lose her medical coverage as the spouse of a disabled veteran and would not have agreed to the property division had she comprehended those implications. (2) During a short cross-examination, Clayton's counsel elicited Elsie's acknowledgment that she had been represented by counsel during the mediation, that the parties had an experienced mediator, and that the mediation had been "lengthy." (3) Elsie did not assert or present evidence that the agreement called for performance of an illegal act or that it was obtained through fraud, duress, coercion, or dishonesty. At the conclusion of the hearing, the trial court stated on the record that it "finds that the Mediated Settlement Agreement was the result of an arms-length negotiation, and represents their agreement, which will be accepted by the Court," and proceeded to render judgment on the decree.
Elsie subsequently filed a motion for new trial, re-urging her arguments regarding mistake. She added that the "the terms of the property settlement provision of the mediated settlement agreement is not a just and equitable division of the property of the parties unless Mrs. Kott retains her military medical benefits and to require her to live with this 'bargain' would be unconscionable." This new trial motion was overruled by operation of law.
We conclude that Elsie's attempt to challenge the fairness, standing alone, of the terms of a mediated settlement agreement complying with section 6.602 has been foreclosed by the legislature. See Tex. Fam. Code Ann. § 6.602(c) ("If a mediated settlement agreement meets the requirements of this section, a party is entitled to judgment on the mediated settlement agreement notwithstanding Rule 11, Texas Rules of Civil Procedure, or another rule of law."); Cayan, 38 S.W.3d at 164-66 & n.8 (section 6.602 agreements are not subject to a just and right determination by the trial court; to conclude otherwise "would suggest that the trial court retains discretion to reject such an agreement, request the parties to negotiate a different agreement and, if necessary, set the matter for hearing," all contrary to section 6.602(c)); see also Carson v. Carson, No. 03-04-00521-CV, 2005 Tex. App. LEXIS 9250, at *3 (Tex. App.--Austin Nov. 4, 2005, no pet.) (mem. op.) ("To the extent that [the appellant] seeks to disturb the contents of the [mediated settlement] agreement on appeal, these issues are barred by statute and the language of the agreement.").
To the extent Elsie's appellate issue regarding "substantive unconscionability" encompasses her trial-level contention regarding mutual mistake, the evidence is legally and factually sufficient to support the trial court's implied findings that she failed to prove that defense. (4) Mullins, 202 S.W.3d at 877; see also Carson, 2005 Tex. App. LEXIS 9250, at *2-3 (rejecting challenge that party "was not fully informed of the financial implications of the agreed upon distribution of property," observing that party was represented by counsel and the mediated settlement agreement "meets all statutory requirements to be binding on the parties"). We observe again that Elsie has not claimed that the mediated settlement agreement was the product of coercion, duress, or fraud.
For these reasons, we overrule Elsie's appellate issues and affirm the trial court's judgment.
____________________________________________
Bob Pemberton, Justice
Before Justices Patterson, Pemberton and Waldrop
Affirmed
Filed: February 29, 2008
1. To avoid confusion from the common surname, we will refer to the parties by their first names.
2. Elsie's sole direct testimony on this point was:
Q: And in the mediation did you request to be awarded those benefits?
A: No, because I had wanted to hand to my attorney papers stating what I wanted out of the divorce, and he wouldn't take it. So I got so flustered I didn't realize that we had not discussed my benefits being taken away if I got a divorce.
Q: Now, I understand your major concern is with your medical benefits through the military.
A: Yes.
Q: And if you were to retain those, you would be glad to go along with this [property] division?
A: Yes.
Q: But if you were going to lose those rights, then would you like for the court to give you another opportunity to negotiate this property?
A: Yes.
3. The record elsewhere reflects that the mediation had lasted all or most of a day. Clayton's counsel also emphasized that it had been Elsie who first filed for divorce.
4. Neither party requested written findings of fact and conclusions of law, and none were filed.
DISMISSED ON JOINT MOTION: Opinion by Chief Justice Law (Before Chief Justice Law, Justices Puryear and Waldrop)
03-06-00618-CV
Appellant, New Braunfels Aero Service, Inc.// Cross-Appellant, City of New Braunfels, Texas v. Appellee, City of New Braunfels, Texas// Cross-Appellee, New Braunfels Aero Service, Inc.--Appeal from 274th District Court of Comal County
FROM THE DISTRICT COURT OF COMAL COUNTY, 274TH JUDICIAL DISTRICT
NO. C2003-0468C, HONORABLE RONALD G. CARR, JUDGE PRESIDING
M E M O R A N D U M O P I N I O N
Appellant/cross-appellee New Braunfels Aero Service, Inc., and appellee/cross- appellant City of New Braunfels, Texas, no longer wish to pursue this appeal and have filed a joint motion to dismiss pursuant to their settlement agreement. We grant the motion and dismiss the appeal. Tex. R. App. P. 42.1(a).
__________________________________________
W. Kenneth Law, Chief Justice
Before Chief Justice Law, Justices Puryear and Waldrop
Dismissed on Joint Motion
Filed: February 28, 2008
03-06-00618-CV
Appellant, New Braunfels Aero Service, Inc.// Cross-Appellant, City of New Braunfels, Texas v. Appellee, City of New Braunfels, Texas// Cross-Appellee, New Braunfels Aero Service, Inc.--Appeal from 274th District Court of Comal County
FROM THE DISTRICT COURT OF COMAL COUNTY, 274TH JUDICIAL DISTRICT
NO. C2003-0468C, HONORABLE RONALD G. CARR, JUDGE PRESIDING
M E M O R A N D U M O P I N I O N
Appellant/cross-appellee New Braunfels Aero Service, Inc., and appellee/cross- appellant City of New Braunfels, Texas, no longer wish to pursue this appeal and have filed a joint motion to dismiss pursuant to their settlement agreement. We grant the motion and dismiss the appeal. Tex. R. App. P. 42.1(a).
__________________________________________
W. Kenneth Law, Chief Justice
Before Chief Justice Law, Justices Puryear and Waldrop
Dismissed on Joint Motion
Filed: February 28, 2008
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