Preview
4/2/2014 11:20:26 AM
Amalia Rodriguez-Mendoza
District Clerk
Travis County
CAUSE NO. D-1-GN-13-004124 D-1-GN-13-004124
LUAN D. NGUYEN 8 IN THE DISTRICT COURT
Plaintiff §
§
v. §
§ 419" JUDICIAL DISTRICT
§
KEVIN BAO PHAN and §
AMLAND, CORP. §
Defendants. § TRAVIS COUNTY, TEXAS
DEFENDANTS’ REPLY TO PLAINTIFF’S RESPONSE TO MOTION FOR NEW
TRIAL AND MOTION TO COMPEL ARBITRATION
TO THE HONORABLE COURT:
NOW COMES KEVIN BAO PHAN (“Phan”) and AMLAND, CORP.,(“Amland”) Defendants,
by and through the undersigned attorneys of record, Thomas W. Robertson, and William B.
Emmons, and file this Reply to Plaintiff's Response! to Defendants’ Amended Motion for New
Trial and Motion to Compel Arbitration and would show:
Duplantis case distinguished
1. Prior to the motion for default judgment being heard and entered on March 11, 2014,
Defendants Phan and Amland filed a motion to transfer venue — a written appearance -- on
February 21, 2014. Plaintiff cites Duplantis v Noble Toyota, Inc., 720 8.W.2d 863 (Tex. App. -
Beaumont, 1986, no writ) for authority that a default judgment can be taken after a motion to
transfer venue has been filed. (See Plaintiff's Response at par. 3). Four important distinctions
exist between the defendant in the Duplantis case and the instant case. First, Duplantis’ motion
to transfer venue was on file for seven months with no attempt to set it for a hearing before the
' Plaintiff's March 27, 2014 filing is entitled “Plaintiff’s Objection to Evidence in Support of Defendants’ Amended
Verified Motion for New Trial, Plaintiff's Motion Seeking Sanctions against Kevin Phan and Motion to Strike
Defendants’ Motion to Transfer Venue, Motion Requesting Kevin Phan to Show Authority to Act on Behalf of
Amland, Corp., and Plaintiff's Objections and Response to Defendants’ Amended Amended Verified Motion for New
Trial, General Denial, and Objections/ Response to Motion to Compel Arbitration,”
Page 1of6default was entered. /d., at 866. By contrast, Phan and Amland’s motion to transfer venue was
filed on February 21, and the default was taken 17 days after the filing, with no notice of the
default judgment hearing to Phan or Amland. In Duplantis there is no indication one way or the
other whether Duplantis was given notice of the hearing on the motion for default judgment.
Third, the Duplantis court noted: “Appellant's motion to transfer venue did not state any ground
of defense he may have had; therefore, it was not an answer.” Id. Unlike Duplantis’ Motion to
Transfer Venue, Phan and Amland’s motion to transfer venue does contain at least one ground of
defense: prior material breach, and it should be considered an answer. Lastly, unlike Duplantis’
failure to request a hearing, Phan and Amland requested a hearing in the body of the motion to
transfer venue. Duplantis is really a sanction for failing to set the motion to transfer venue
timely under Tex. R. Civ, P. 87° and is not dispositive authority here.
Phan and Amland made a general appearance prior to default judgment
2. Regardless of whether this Court is persuaded that Phan and Amland’s motion to transfer
venue should be considered an answer, the Court will find it uncontroversial to note that the
motion to transfer venue was a general appearance. Phan and Amland’s motion made a
substantive request to the Court to transfer the case. A substantive request to the Court is a
general appearance. The motion to transfer venue could not be considered a special appearance
because under TEX. R. Clv. P. 120a, a special appearance must be verified and the motion to
transfer venue was not. Rule 120a provides “Every appearance, prior to judgment, not in
compliance with this rule is a general appearance.”
2 See Glover v Moser, 930 $,W.2d 940, 944 (Tex. Civ. App- Beaumont, no writ) (“we view
Duplantis as authority concerning the failure to comply with Rule 87, Texas Rules of Civil
Procedute.”)
Page 2 of 63. As such, the only type of default that could have been entered after the written
appearance must comply with the law governing post-appearance default judgments, A recent
case that does a good job of summarizing the different types of default judgments is Sedona Pac.
Hous. P'ship v. Ventura, 408 8, W.3d 507 (Tex. App. El Paso 2013, no writ) which provides:
‘The Supreme Court had also recognized a fourth category of default judgment: a
post-appearance default judgment, LBL Oil Co. v. International Power Services,
Inc., 777 8.W.2d 390 (Tex.1989). This type of default judgment occurs when the
defendant makes a general appearance but fails to answer or appear for trial, Once
a defendant has made an appearance, he is entitled to notice of the trial setting as
a matter of due process under the Fourteenth Amendment. Peralta v. Heights
Medical Center, Inc., 485 U.S. 80, 108 S.Ct. 896, 99 L.Ed.2d 75 (1988); LBL Oil,
777 S.W.2d at 390-91; In re Brilliant, 86 S.W.3d 680, 693 (Tex.App.-El Paso
2002, orig. proceeding).
Id.,a512.
45 days notice is mandatory/ Craddock test satisfied
4, Phan/Amland were entitled to 45 days notice of the default judgment setting as a
matter of due process. LBL Oil, 777 8.W.2d at 390-91; TEX, R. Cry. P. 245,
5. The 45 day notice is mandatory. Smith v. Lippmann, 826 S.W.2d 137, 138 (Tex.
1992). A default judgment should be set aside in any case in which the defendant
demonstrates (1) that its failure to answer or appear was not intentional or the result of
conscious indifference; (2) that it has a meritorious defense; and (3) that the granting of a
new trial will not operate to cause delay or other injury to the plaintiff. Craddock v.
Sunshine Bus Lines, Inc., 134 Tex. 388, 133 S.W.2d 124, 126 (Tex. 1939)
6. Because Phan and Amland did not receive 45 days' notice, they satisfied the first
Craddock factor and they are not obligated to meet the remaining requirements to be
entitled to a new trial and are entitled to have the default judgment set aside. LBL Oil,
Page 3 of 6777 S.W.2d at 390-91,
7. The historical trend in default judgment cases is toward the liberal granting of
new trials, Miller y, Miller, 903 S.W.2d 45, 47 (Tex. App.--Tyler 1995, no writ).
Response to motion to strike undersigned counsel’s verification
8. Plaintiff's motion to strike undersigned counsel’s verification of the amended
motion for new trial -- even if granted-- does not change the evidence apparent from the
Clerk’s record which this Court will judicially notice. The only facts necessary and
sufficient to support the granting of Amland and Phan’s motion for new trial are -- not the
truth of the venue facts averred in the contents of Phan and Amland’s motion to transfer
venue-- but ate: 1) the fact that the motion to transfer venue was a general appearance
filed with the clerk 17 days prior to the entry of the default judgment; and 2) the
undisputed absence of 45 days notice of the setting of the default judgment hearing.
Response to motion for sanctions
9. Plaintiff dedicates paragraphs 9-41, and 64-66 of its March 27, 2014 response
filing in support of a request that the Court strike Phan and Amland’s motion to transfer
venue and award sanctions in a strained attempt to retain its improperly obtained default
judgment. Phan and Amland concede venue is proper at arbitration in Austin, Texas.
The merits of the transfer venue motion are mooted by Phan and Amland’s concession to
arbitrate in Austin, Texas per the agreement between the parties,
Response to motion seeking Phan’s authority to act on behalf of Amland
10. Plaintiff's use of Tex. R. Civ. P. 12 is misplaced. Phan did not hold himself out as an
attorney by filing his motion to transfer venue. Phan’s pro se appearance on behalf of Amland,
suffices as a matter of law, as a general appearance entitling Amland to 45 days notice of the
Page 4 of 6default judgment setting. Custom-Crete v. K-Bar Servs., Inc,, 82 8.W.3d 655, 660 (Tex. App.—
San Antonio 2002, no pet.).
Reply to Plaintiff’s objection and response to motion to compel arbitration
11. Pursuant to TEX. Crv. PRAC.& Rem. Cope § 171.021, this Court “shall order the parties to
arbitrate on application of a party showing: (1) an agreement to arbitrate; (2) the opposing
party’s refusal.” The contract between the parties, attached to Plaintiff's Motion for Judgment
By Default, Exhibit 1 contains the agreement to arbitrate, at page 2, par. 1. The claims alleged by
Plaintiff fall within the scope of the agreement. Plaintiffs various complaints about ambiguity
in the arbitration clause, the very agreement he sues upon, do not overcome the Texas Supreme
Court’s strong policy preference for enforcing arbitration clauses. Capital Income Properties-
LXXX v. Blackmon, 843 8.W.2d 22, 23 (Tex. 1992). A party seeking to compel arbitration must
establish the existence of an arbitration agreement and show that their claims fall within the
scope of that agreement. In re Oakwood Mobile Homes, Inc., 987 S.W.2d 571, 573 (Tex. 1999).
Once a claim within the arbitration agreement has been established, the burden shifts to the other
party to demonstrate a legal basis for avoiding arbitration. Jd. In determining whether to compel
arbitration, the court must decide two issues: (1) whether a valid, enforceable arbitration
agreement exists, and (2) if so, whether the claims asserted fall within the scope of the
agreement. The court has no discretion and must compel arbitration if the answer to both
questions is affirmative. Merrill Lynch, Pierce, Fenner & Smith v. Eddings, 838 S.W.2d 874, 878
(Tex. App.-Waco 1992, writ denied), Doubts regarding the scope of arbitration agreements are
resolved in favor of arbitration. Jd. at 880.
Page 5 of 6WHEREFORE, PREMISES CONSIDERED, Defendants repeats their request that the Court:
1 set aside the default judgment in this cause;
2. abate the lawsuit pursuant to TEx. Civ. PRAC. & REM. CODE § 171.025 and order
arbitration.
Respectfully submitted,
BAKER & ROBERTSON
P.O. Box 718
Dripping Springs, Texas 78620
Tel (512) 894-0890
Fax (512) 89450346
a(x beobwtyr
By: Thomas /W. Robertson
State Bar No. 00797329
Attorneys for Amland Corp., and Kevin
Phan, defendants
Of Counsel:
Wm. B. Emmons
State Bar No. 06610450
EMMONS LEGAL
1235 Shadowdale Drive
Houston, Texas 77043
Tel (713) 825-4474
CERTIFICATE OF SERVICE
I certify that a true copy of the foregoing reply was served on the Plaintiff’s attorney of
record below on April 2.2014 as indicated:
i
VIA FAX (512) 252-2850 |
THE LAW OFFICES OF DOMINIC AUDINO i
Dominic Audino
Arboretum Plaza One
9442 N, Capital of Texas Hwy, Ste. 500 |
Austin, Texas 78759 (+ a Wa
Thomas W. Robertson
Page 6 of 6
Preview
4/2/2014 11:20:26 AM Amalia Rodriguez-Mendoza District Clerk Travis County CAUSE NO. D-1-GN-13-004124 D-1-GN-13-004124 LUAN D. NGUYEN 8 IN THE DISTRICT COURT Plaintiff § § v. § § 419" JUDICIAL DISTRICT § KEVIN BAO PHAN and § AMLAND, CORP. § Defendants. § TRAVIS COUNTY, TEXAS DEFENDANTS’ REPLY TO PLAINTIFF’S RESPONSE TO MOTION FOR NEW TRIAL AND MOTION TO COMPEL ARBITRATION TO THE HONORABLE COURT: NOW COMES KEVIN BAO PHAN (“Phan”) and AMLAND, CORP.,(“Amland”) Defendants, by and through the undersigned attorneys of record, Thomas W. Robertson, and William B. Emmons, and file this Reply to Plaintiff's Response! to Defendants’ Amended Motion for New Trial and Motion to Compel Arbitration and would show: Duplantis case distinguished 1. Prior to the motion for default judgment being heard and entered on March 11, 2014, Defendants Phan and Amland filed a motion to transfer venue — a written appearance -- on February 21, 2014. Plaintiff cites Duplantis v Noble Toyota, Inc., 720 8.W.2d 863 (Tex. App. - Beaumont, 1986, no writ) for authority that a default judgment can be taken after a motion to transfer venue has been filed. (See Plaintiff's Response at par. 3). Four important distinctions exist between the defendant in the Duplantis case and the instant case. First, Duplantis’ motion to transfer venue was on file for seven months with no attempt to set it for a hearing before the ' Plaintiff's March 27, 2014 filing is entitled “Plaintiff’s Objection to Evidence in Support of Defendants’ Amended Verified Motion for New Trial, Plaintiff's Motion Seeking Sanctions against Kevin Phan and Motion to Strike Defendants’ Motion to Transfer Venue, Motion Requesting Kevin Phan to Show Authority to Act on Behalf of Amland, Corp., and Plaintiff's Objections and Response to Defendants’ Amended Amended Verified Motion for New Trial, General Denial, and Objections/ Response to Motion to Compel Arbitration,” Page 1of6default was entered. /d., at 866. By contrast, Phan and Amland’s motion to transfer venue was filed on February 21, and the default was taken 17 days after the filing, with no notice of the default judgment hearing to Phan or Amland. In Duplantis there is no indication one way or the other whether Duplantis was given notice of the hearing on the motion for default judgment. Third, the Duplantis court noted: “Appellant's motion to transfer venue did not state any ground of defense he may have had; therefore, it was not an answer.” Id. Unlike Duplantis’ Motion to Transfer Venue, Phan and Amland’s motion to transfer venue does contain at least one ground of defense: prior material breach, and it should be considered an answer. Lastly, unlike Duplantis’ failure to request a hearing, Phan and Amland requested a hearing in the body of the motion to transfer venue. Duplantis is really a sanction for failing to set the motion to transfer venue timely under Tex. R. Civ, P. 87° and is not dispositive authority here. Phan and Amland made a general appearance prior to default judgment 2. Regardless of whether this Court is persuaded that Phan and Amland’s motion to transfer venue should be considered an answer, the Court will find it uncontroversial to note that the motion to transfer venue was a general appearance. Phan and Amland’s motion made a substantive request to the Court to transfer the case. A substantive request to the Court is a general appearance. The motion to transfer venue could not be considered a special appearance because under TEX. R. Clv. P. 120a, a special appearance must be verified and the motion to transfer venue was not. Rule 120a provides “Every appearance, prior to judgment, not in compliance with this rule is a general appearance.” 2 See Glover v Moser, 930 $,W.2d 940, 944 (Tex. Civ. App- Beaumont, no writ) (“we view Duplantis as authority concerning the failure to comply with Rule 87, Texas Rules of Civil Procedute.”) Page 2 of 63. As such, the only type of default that could have been entered after the written appearance must comply with the law governing post-appearance default judgments, A recent case that does a good job of summarizing the different types of default judgments is Sedona Pac. Hous. P'ship v. Ventura, 408 8, W.3d 507 (Tex. App. El Paso 2013, no writ) which provides: ‘The Supreme Court had also recognized a fourth category of default judgment: a post-appearance default judgment, LBL Oil Co. v. International Power Services, Inc., 777 8.W.2d 390 (Tex.1989). This type of default judgment occurs when the defendant makes a general appearance but fails to answer or appear for trial, Once a defendant has made an appearance, he is entitled to notice of the trial setting as a matter of due process under the Fourteenth Amendment. Peralta v. Heights Medical Center, Inc., 485 U.S. 80, 108 S.Ct. 896, 99 L.Ed.2d 75 (1988); LBL Oil, 777 S.W.2d at 390-91; In re Brilliant, 86 S.W.3d 680, 693 (Tex.App.-El Paso 2002, orig. proceeding). Id.,a512. 45 days notice is mandatory/ Craddock test satisfied 4, Phan/Amland were entitled to 45 days notice of the default judgment setting as a matter of due process. LBL Oil, 777 8.W.2d at 390-91; TEX, R. Cry. P. 245, 5. The 45 day notice is mandatory. Smith v. Lippmann, 826 S.W.2d 137, 138 (Tex. 1992). A default judgment should be set aside in any case in which the defendant demonstrates (1) that its failure to answer or appear was not intentional or the result of conscious indifference; (2) that it has a meritorious defense; and (3) that the granting of a new trial will not operate to cause delay or other injury to the plaintiff. Craddock v. Sunshine Bus Lines, Inc., 134 Tex. 388, 133 S.W.2d 124, 126 (Tex. 1939) 6. Because Phan and Amland did not receive 45 days' notice, they satisfied the first Craddock factor and they are not obligated to meet the remaining requirements to be entitled to a new trial and are entitled to have the default judgment set aside. LBL Oil, Page 3 of 6777 S.W.2d at 390-91, 7. The historical trend in default judgment cases is toward the liberal granting of new trials, Miller y, Miller, 903 S.W.2d 45, 47 (Tex. App.--Tyler 1995, no writ). Response to motion to strike undersigned counsel’s verification 8. Plaintiff's motion to strike undersigned counsel’s verification of the amended motion for new trial -- even if granted-- does not change the evidence apparent from the Clerk’s record which this Court will judicially notice. The only facts necessary and sufficient to support the granting of Amland and Phan’s motion for new trial are -- not the truth of the venue facts averred in the contents of Phan and Amland’s motion to transfer venue-- but ate: 1) the fact that the motion to transfer venue was a general appearance filed with the clerk 17 days prior to the entry of the default judgment; and 2) the undisputed absence of 45 days notice of the setting of the default judgment hearing. Response to motion for sanctions 9. Plaintiff dedicates paragraphs 9-41, and 64-66 of its March 27, 2014 response filing in support of a request that the Court strike Phan and Amland’s motion to transfer venue and award sanctions in a strained attempt to retain its improperly obtained default judgment. Phan and Amland concede venue is proper at arbitration in Austin, Texas. The merits of the transfer venue motion are mooted by Phan and Amland’s concession to arbitrate in Austin, Texas per the agreement between the parties, Response to motion seeking Phan’s authority to act on behalf of Amland 10. Plaintiff's use of Tex. R. Civ. P. 12 is misplaced. Phan did not hold himself out as an attorney by filing his motion to transfer venue. Phan’s pro se appearance on behalf of Amland, suffices as a matter of law, as a general appearance entitling Amland to 45 days notice of the Page 4 of 6default judgment setting. Custom-Crete v. K-Bar Servs., Inc,, 82 8.W.3d 655, 660 (Tex. App.— San Antonio 2002, no pet.). Reply to Plaintiff’s objection and response to motion to compel arbitration 11. Pursuant to TEX. Crv. PRAC.& Rem. Cope § 171.021, this Court “shall order the parties to arbitrate on application of a party showing: (1) an agreement to arbitrate; (2) the opposing party’s refusal.” The contract between the parties, attached to Plaintiff's Motion for Judgment By Default, Exhibit 1 contains the agreement to arbitrate, at page 2, par. 1. The claims alleged by Plaintiff fall within the scope of the agreement. Plaintiffs various complaints about ambiguity in the arbitration clause, the very agreement he sues upon, do not overcome the Texas Supreme Court’s strong policy preference for enforcing arbitration clauses. Capital Income Properties- LXXX v. Blackmon, 843 8.W.2d 22, 23 (Tex. 1992). A party seeking to compel arbitration must establish the existence of an arbitration agreement and show that their claims fall within the scope of that agreement. In re Oakwood Mobile Homes, Inc., 987 S.W.2d 571, 573 (Tex. 1999). Once a claim within the arbitration agreement has been established, the burden shifts to the other party to demonstrate a legal basis for avoiding arbitration. Jd. In determining whether to compel arbitration, the court must decide two issues: (1) whether a valid, enforceable arbitration agreement exists, and (2) if so, whether the claims asserted fall within the scope of the agreement. The court has no discretion and must compel arbitration if the answer to both questions is affirmative. Merrill Lynch, Pierce, Fenner & Smith v. Eddings, 838 S.W.2d 874, 878 (Tex. App.-Waco 1992, writ denied), Doubts regarding the scope of arbitration agreements are resolved in favor of arbitration. Jd. at 880. Page 5 of 6WHEREFORE, PREMISES CONSIDERED, Defendants repeats their request that the Court: 1 set aside the default judgment in this cause; 2. abate the lawsuit pursuant to TEx. Civ. PRAC. & REM. CODE § 171.025 and order arbitration. Respectfully submitted, BAKER & ROBERTSON P.O. Box 718 Dripping Springs, Texas 78620 Tel (512) 894-0890 Fax (512) 89450346 a(x beobwtyr By: Thomas /W. Robertson State Bar No. 00797329 Attorneys for Amland Corp., and Kevin Phan, defendants Of Counsel: Wm. B. Emmons State Bar No. 06610450 EMMONS LEGAL 1235 Shadowdale Drive Houston, Texas 77043 Tel (713) 825-4474 CERTIFICATE OF SERVICE I certify that a true copy of the foregoing reply was served on the Plaintiff’s attorney of record below on April 2.2014 as indicated: i VIA FAX (512) 252-2850 | THE LAW OFFICES OF DOMINIC AUDINO i Dominic Audino Arboretum Plaza One 9442 N, Capital of Texas Hwy, Ste. 500 | Austin, Texas 78759 (+ a Wa Thomas W. Robertson Page 6 of 6