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NO. 04-15-00087-CV
IN THE COURT OF APPEALS FOR THE FOURTH DISTRICT OF TEXAS AT SAN
ANTONIO
ESTATE OF SHIRLEY L. BENSON
THOMAS MILTON BENSON, JR., AS TRUSTEE OF THE
SHIRLEY L. BENSON TESTAMENTARY TRUST, Appellant
v.
RENEE BENSON, Appellee
On Interlocutory Appeal from Probate Court No. 2, Bexar County,
Texas
Cause Nos. 155,172 and 155,172-A
BRIEF OF APPELLEE Bennett L. Stahl State Bar No. 19006500
[email protected] CURL STAHL GEIS, P.C. One Riverwalk Place 700
North St. Marys Street Suite 1800 San Antonio, Texas 78205
Telephone: (210) 226-2182 Telecopier: (210) 226-1691
Harriet ONeill State Bar No. 00000027
[email protected] LAW OFFICE OF HARRIET ONEILL, P.C. 919
Congress Ave., Suite 1400 Austin, Texas 78701 Telephone: (512)
944-2222 Telecopier: (512) 476-6441 Emily Harrison Liljenwall State
Bar No. 12352250 [email protected] SCHOENBAUM, CURPHY &
SCANLAN, P.C. 112 E. Pecan, Suite 3000 San Antonio, Texas 78205
Telephone: (210) 224-4491 Telecopier: (210) 224-7983
Douglas W. Alexander State Bar No. 00992350
[email protected] Amy Warr State Bar No. 00795708
[email protected] ALEXANDER DUBOSE JEFFERSON & TOWNSEND LLP 515
Congress Avenue Suite 2350 Austin, Texas 78701-3562 Telephone:
(512) 482-9300 Facsimile: (512) 482-9303
ATTORNEYS FOR APPELLEE ORAL ARGUMENT CONDITIONALLY REQUESTED
ACCEPTED04-15-00087-CV
FOURTH COURT OF APPEALSSAN ANTONIO, TEXAS
7/10/2015 3:32:15 PMKEITH HOTTLE
CLERK
FILED IN4th COURT OF APPEALS SAN ANTONIO, TEXAS07/10/2015
3:32:15 PM KEITH E. HOTTLE Clerk
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i
TABLE OF CONTENTS
Table of Contents
.......................................................................................................
i
Index of Authorities
................................................................................................
iii
Statement of the Case
...............................................................................................iv
Issue Presented
.........................................................................................................iv
Statement Regarding Oral Argument
.......................................................................
1
Statement of Facts
.....................................................................................................
1
Summary of the Argument
........................................................................................
9
Standard of Review
.................................................................................................
11
Argument.................................................................................................................
11
I. The trial court did not abuse its discretion in suspending
the Trustee pending trial and appointing temporary receivers
........................................ 11
A. A trustee is a fiduciary whose duties are prescribed by the
instrument that created the trust, statutes, and common law
............. 11
B. The beneficiary demonstrated both actual and threatened
breaches of trust under 114.008(a) of the Property Code
................ 13
C. Tom committed an actual, or at least a threatened, breach of
Shirleys Trust by severing all contact with Renee
............................ 14
D. Tom breached, and threatened to breach, the Trust through his
actions directed at Lone Star Capital Bank
........................................ 20
E. Tom committed an actual, and a threatened, breach of trust by
hiding the bookkeeper
........................................................................
25
F. Though actual harm to the Trust was shown, no showing of harm
or less intrusive methods is required
.................................................. 27
G. The Trustee had ample notice that a receivership had been
requested
.............................................................................................
30
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ii
II. The trial courts order complies with Texas Rule of Civil
Procedure 683 ....... 32
A. The appointment of receivers is not an injunction, and thus
not within Rule 683s purview
.................................................................
33
B. The temporary injunction complied with Rule 683, and thus was
not an abuse of discretion
...................................................................
34
III. Toms due-process challenges to the Amended Order fail
.......................... 40 Prayer
......................................................................................................................
44
Certificate of Service
..............................................................................................
46
Certificate of Compliance
.......................................................................................
47
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iii
INDEX OF AUTHORITIES
Cases
Abetter Trucking Co. v. Arizpe, 113 S.W.3d 503 (Tex. App.Houston
[1ST Dist.] 2003, no pet.) ............... 12, 23
Akin v. Dahl, 661 S.W.2d 911 (Tex. 1983)
..................................................................
18, 19, 20
Amalgamated Acme Affiliates, Inc. v. Minton, 33 S.W.3d 387 (Tex.
App.Austin 2000, no pet.)
............................................ 38
Arkoma Basin Exploration Co. v. FMF Associates 1990A Ltd. 249
S.W.3d 380 (Tex. 2008)
..............................................................................
39
In re Baby Girl S., 407 S.W.3d 904 (Tex. App.Dallas 2013, pet.
denied), cert. denied sub nom., Cole v. Generations Adoptions, 135
S. Ct. 1896 (2015)
........................................................................................
42
Barrientos v. Nava, 94 S.W.3d 270 (Tex. App.Houston [14th Dist.]
2002, no pet.) ............... 18, 19
Benefield v. State, 266 S.W.3d 25 (Tex. App.Houston [1st Dist.]
2008, no pet.) .................. 11, 28
Ex parte Blanchard, 736 S.W.2d 642 (Tex. 1987)
..............................................................................
42
In re C.F.M., 360 S.W.3d 654 (Tex. App.Dallas 2012, no pet.)
.................................... 42, 43
C/S Solutions, Inc. v. Energy Maint. Servs. Group LLC, 274
S.W.3d 299 (Tex. App.Houston [1st Dist.] 2008, no pet.)
...................... 44
Chapa v. Chapa, No. 04-12-00519-CV, 2012 WL 6728242 (Tex.
App.San Antonio Dec. 28, 2012, no pet.) (mem. op.)
....................................................... 28
Conseco Fin. Servicing v. Klein Indep. Sch. Dist., 78 S.W.3d 666
(Tex. App.Houston [14th Dist.] 2002, no pet.) .....................
42
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iv
El Tacaso, Inc. v. Jireh Star, Inc., 356 S.W.3d 740 (Tex.
App.Dallas 2011, no pet.)
.......................................... 38
Elliott v. Weatherman, 296 S.W.3d 224 (Tex. App.Austin 2013)
................................................. 28, 31
First Natl Bank of Beaumont v. Howard, 229 S.W.2d 781 (Tex.
1950) ............................................................
14, 15, 17, 19
Fortenberry v. Cavanaugh, No. 03-04-00816-CV, 2005 WL 1412103
(Tex. App.Austin June 16, 2005, no pet.) (mem. op.)
.....................................................................
28
Gen. Homes, Inc. v. Wingate Civic Assn, 616 S.W.2d 351 (Tex.
Civ. App.Houston [14th Dist.] 1981, no writ)
.....................................................................................................................
39
In re Hereweareagain, Inc., 383 S.W.3d 703 (Tex. App.Houston
[14th Dist.] 2012, no pet.) ................... 42
Huie v. DeShazo, 922 S.W.2d 920 (Tex. 1996)
........................................................................
12, 25
Hunt v. State ex rel. K.C., No. 03-11-00352-CV, 2012 WL 3793283
(Tex. App.Austin Aug. 31, 2012, no pet.) (mem. op.)
.....................................................................
42
IAC, Ltd. v. Bell Helicopter Textron, Inc., 160 S.W.3d 191 (Tex.
App.Fort Worth 2005, no pet.) ...................................
38
Intl Brotherhood of Electrical Workers Local Union 479 v. Becon
Construction Co., Inc., 104 S.W.3d 239 (Tex. App.Beaumont 2003, no
pet.) .................................... 40
Kinzbach Tool Co. v. Corbett-Wallace Corp., 160 S.W.2d 509 (Tex.
1942)
..............................................................................
12
Kotz v. Imperial Capital Bank, 319 S.W.3d 54 (Tex. App.San
Antonio 2010, no pet.) .................................. 39
Monsanto Co. v. Davis, 25 S.W.3d 773 (Tex. App.Waco 2000, pet.
dismd w.o.j.) ............................ 39
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v
Montgomery v. Kennedy, 669 S.W.2d 309 (Tex. 1984)
..............................................................................
25
Negrini v. Beale, 822 S.W.2d 822 (Tex. App.Houston [14th Dist.]
1992, no pet.) ................... 32
Onoray Davis Trucking Co., Inc. v. Lewis, 635 S.W.2d 622 (Tex.
App.Houston [14th Dist.] 1982, writ dismd)
................................................................................................................
34
Orix Capital Mkts., LLC v. La Villita Motor Inns, J.V., 329
S.W.3d 30 (Tex. App.San Antonio 2010, pet denied)
............................. 11
Rio Grand Exploration, L.L.C. v. Anju Prod., L.L.C., No.
04-08-00495-CV, 2009 WL 618616 (Tex. App.San Antonio Mar. 11, 2009,
no pet.) (mem. op.)
.....................................................................
39
Sassen v. Tanglegrove Townhouse Condo Assn, 877 S.W.2d 489 (Tex.
App.Texarkana 1994, writ denied) ............................
17
Tex. Commerce Bank, N.A. v. Grizzle, 96 S.W.3d 240 (Tex.
2002).................................................................................
13
Tex. Health & Human Servs. Commn v. Advocates for Patient
Access, Inc., 399 S.W.3d 615 (Tex. App.Austin 2013, no pet.)
.......................................... 43
Tex. Workers Comp. Commn v. Patient Advocates of Tex., 136
S.W.3d 643 (Tex. 2004)
..............................................................................
41
Thota v. Young, 366 S.W.3d 678 (Tex. 2012)
..............................................................................
43
Tuma v. Kerr County, 336 S.W.3d 277 (Tex. App.San Antonio 2010,
no pet.) ................................ 40
Unifund CCR Partners v. Villa, 299 S.W.3d 92 (Tex.
2009).................................................................................
11
Univ. Interscholastic League v. Torres, 616 S.W.2d 355 (Tex.
Civ. App.San Antonio 1981, no writ) .................. 38, 40
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vi
Statutes and Rules
TEX. CIV. PRAC. & REM. CODE 64.001(a)
.................................................. 28, 32, 33
TEX. PROP. CODE 113.051
......................................................................................
11
TEX. PROP. CODE 114.001(b)
.................................................................................
13
TEX. PROP. CODE 114.008
....................................................................
13, 27, 28, 33
TEX. PROP. CODE 117.007
..........................................................................
20, 23, 25
TEX. R. APP. P. 29.5(a)
.............................................................................................
43
TEX. R. APP. P. 44.1(a)
............................................................................................
43
TEX. R. CIV. P. 21
.....................................................................................................
41
TEX. R. CIV. P. 683
...................................................................................................
33
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vii
STATEMENT OF THE CASE
Nature of the Case: Parties in the Trial Court:
Action to remove trustee and request for temporary injunction
and appointment of temporary receiver under 113.082 and 114.008 of
the Texas Property Code Petitioner: Renee Benson Respondent: Thomas
Milton Benson, Jr., in his capacity as Trustee of the Shirley L.
Benson Testamentary Trust
Trial Court:
Hon. Tom Rickhoff, Probate Court No. 2, Bexar County
Trial Court Disposition:
Granted temporary relief, including: temporary injunction,
temporary suspension of trustee, and appointment of temporary
receivers to preserve and
manage trust during litigation
ISSUE PRESENTED
With respect to the administration of the testamentary trust at
issue, did the
probate court act within the bounds of its authorized discretion
in granting temporary
injunctive relief, suspending the trustee, and appointing
temporary co-receivers with
restrictions?
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STATEMENT REGARDING ORAL ARGUMENT
Appellee does not believe that oral argument is necessary, as
this appeal
involves a straightforward application of established law
regarding receiverships and
injunctions to largely undisputed facts. But, if the Court
believes that oral argument
would be helpful, Appellees counsel stands ready to appear.
STATEMENT OF FACTS
Renee Benson is the daughter of Tom Benson and his first wife,
Shirley L.
Benson, who died in 1980. 3 RR 24. In her Last Will and
Testament, Shirley created
a testamentary trust (Shirleys Trust). 3B RR Plfs Ex. 1, Will
VI. Tom is the
income beneficiary of Shirleys Trust. Id. VI.A. After Toms
death, their three
children (Robert, Renee, and Jeanne Marie) were to divide the
residual trust assets.
Id. VI.D. While Tom was living, the children could also receive
principal
distributions for their health, support, and maintenance. Id.
VI.C. Shirley appointed
Tom as the Trustee. Id. IX. In the Second Codicil to her Will,
Shirley named Renee
as the Successor Trustee. Id., 2nd Codicil, VIII.
The Bensons were a very close and loving family. 3 RR 63-64,
154. They
spent summers at their ranch near Blanco, Texas; Tom came on
weekends from San
Antonio. 3 RR 156. When Renee was eight years old, Tom taught
her how to drive
in an old jeep. 3 RR 157. The family also took frequent
vacations together. 3 RR
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156. After Shirleys death, Renees two siblings died, leaving
Renee as the only
surviving child. 3 RR 151, 226.
The Bensons closeness extended to business. Tom began his
entrepreneurial
career owning and operating car dealerships. 3 RR 39-40. Then he
moved into
banking. 3 RR 40. Now, most famously, he owns the National
Football Leagues
New Orleans Saints, the National Basketball Leagues New Orleans
Pelicans, and
other business interests. See 3 RR 23. Renee and her children,
Rita LeBlanc (Rita)
and Ryan LeBlanc (Ryan), joined the family businesses as well. 2
RR 22, 3 RR
64, 81, 89. Tom wanted Renee, Rita, and Ryan to learn all they
could about the
businesses. 3 RR 81, 89.
In 1996, Renee formed her own company, Renson Enterprises,
Inc.
(Renson), that until the end of 2014 provided back-office
support (payroll, 401k,
health and casualty insurance, human resources, information
technology, relations
with the manufacturers) to all of the Benson car dealerships. 3
RR 64-66, 166-67.
Ryan was working with the dealerships in San Antonio. 3 RR 64.
Rita was Vice-
Chairman (second-in-command) of the Saints and Pelicans, and was
being groomed
to eventually succeed Tom as owner representative. 2 RR 22.
Additionally, Renee,
Rita, and Ryan were members of the board of directors of
numerous Benson
companies, 3B RR Plfs Ex. 3, including Lone Star Capital Bank
(the Bank) in
San Antonio. 3B RR Plfs Ex. 7.
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Shirleys Trust1 owns over 97% of the Bank. 3 RR 49. It also owns
49-50%
of Bensco, Inc. (Bensco), 3 RR 270a holding company that owns
all of the
Benson familys five car dealerships in New Orleans and San
Antonio. 3 RR 160-
61, 167. Shirleys Trust also owns cash as well as real property
associated with
Uptown Blanco, Ltd., a long-term community revitalization
initiative in the town of
Blanco, Texaswhich is near the Benson family ranch. 3 RR 53,
161, 275.
Tom remarried twice after Shirleys death. 3 RR 167-69. His third
and current
wife is Gayle Benson, who he married in 2004. 3 RR 169, 227. At
the time of the
hearing, Tom was 87 years old. 3 RR 176.
In late 2014, Toms behavior toward Renee, Rita, and Ryan
abruptly and
inexplicably changed. Shortly after Thanksgiving, Tom urgently
asked Renee (living
in San Antonio) to come see him in New Orleans. 3 RR 188-89. She
went to his
house on December 2, 2014, and found him out of it. 3 RR 192.
She knew he was
taking lots of medications, and he had told her he did not know
what they were. 3
RR 182. He did not express any anger toward Renee or his
grandchildren. 3 RR 195.
1 After Shirleys Will was admitted to probate in 1980, Tom in
his capacity as Executor should have formally transferred the
probate assets to himself in his capacity as Trustee of Shirleys
Trust. It appears he failed to do that, and Tom may actually be
holding title as Executor rather than as Trustee. For this reason,
the trial courts order appointing the Co-Receivers expressly
empowers the Co-Receivers to take custody of all assets of both
Shirleys Trust and Shirleys Estate. Accordingly, any reference to
Shirleys Trust in this brief should be regarded as a reference to
Shirleys Estate as well.
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Since then, despite her efforts, she has not been allowed to
visit her father in person
or speak to him.
The Bensons typically spent the Christmas holidays together as a
family in
New Orleans. 3 RR 196-97. In 2014 Tom and Gayle, for the first
time, did not invite
Renee and her family to spend Christmas with them. 3 RR 198.
Rita lives in New
Orleans, and Renee, Ryan, and Ryans family came to New Orleans
to spend
Christmas with her. Having been told she was not to go onto the
facilities, Renee did
not attend the Saints game. Id. Rita and Ryan did attend but,
contrary to family
tradition, Ryans children (Toms great-grandchildren) were not
invited to Toms
suiteeven though other children were. Id.
A few days after Christmas, Renee received in an email
attachment a letter
signed by her father. It read:
Dear Renee, Rita and Ryan:
During the over 80 years of my life, I have built a rather large
estate which was intended to mainly be for you all as my
family.
Suddenly after I remarried you all became offensive and did not
act in an appropriate manner and even had arguments among
yourselves which created a very unpleasant family situation which I
will not stand for. It made me very unhappy and uncomfortable. This
situation cannot continue at my age.
Because of the facts set out above and the heart break you have
caused me I want no further contact with any of you and you will
not be allowed to enter the Saints facilities or games, the
Basketball facilities or Pelicans games, the Benson Towers, the
T.V. facilities or the
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5
automotive facilities in New Orleans and will have no right to
give directions, orders or hire or fire any of the personnel.
Sincerely yours, your father and grandfather,
Tom Benson
3B RR Plfs Ex. 20. Renee immediately attempted to contact Tom by
phone and in
writing, but to no avail. In early January she went to New
Orleans and stayed a week,
repeatedly trying to make arrangements to see her father through
Dennis Lauscha,
President of the Saints and Pelicans, 3 RR 8, but was told her
father refused. 3 RR
206-07. Just a few weeks later, Tom took unprecedented actions
against his family,
one of which was to attempt to fire Renee, Rita, and Ryan as
directors of the Bank.
3 RR 81.
At the same time, Tom was also distancing himself from two of
his most
trusted business associates. Tom Roddy (Roddy) and Tom have
known each other
and worked together for 43 years. 3 RR 52. Roddy is a longtime
banker in San
Antonio and served two terms as a director for the San Antonio
branch of the Dallas
Federal Reserve Bank. 3 RR 61. He has assisted Tom with multiple
business
ventures over the years and is on the board of directors of
virtually every Benson
company. 3 RR 55-56, 61, 3B RR Plfs Ex. 3. He has been chairman
of the Banks
Board of Directors since its acquisition by Shirleys Trust. 3 RR
49-50.
Bill McCandless (McCandless) is also a longtime San Antonio
banker who
has known Tom for 37 years. 3 RR 52. McCandless has been on the
Board of
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Directors of the Bank since its acquisition, 3 RR 81, and also
served as its President,
3 RR 52. Nonetheless, in early January 2015, Tom as Trustee
attempted to fire
Roddy and McCandlessin addition to Renee, Rita, and Ryanfrom the
Banks
Board. 3 RR 80-81. Roddy testified that Tom had never
communicated any anger or
dissatisfaction to him. 3 RR 63.
Toms attempted removal of the Banks directors followed closely
on the
heels of another action directed at the Bank: Toms abrupt
withdrawal of
approximately $25 million, representing 12% of the Banks total
deposits of $203
million. 3 RR 78, 80; 4 RR 71; 3B RR Plfs Ex. 4. Of the $25
million, $4.7 million
was cash owned by Shirleys Trust. 3 RR 119. Although Danny Buck,
the Banks
current CEO and President, had received a warning from Stanley
Rosenberg (the
Trusts limited-purpose co-trustee) just before Christmas that
Tom was considering
withdrawing money, 4 RR 67, Buck still had to scramble to cover
the withdrawal.
The Bank had to sell some securities and, in the interim before
the sale cleared,
obtain a short-term loan of $3 million. 4 RR 86. In Bucks 34
years of banking, it
was unprecedented that the owner of a bank would place it in
such an urgent
situation. 4 RR 62, 86. Tom himself never gave Buck any warning
of the impending
withdrawal. 4 RR 91-92.
Toms disconcerting use of his power as Trustee went beyond
specific trust
assets such as the Bank. In early December 2014, Tom instructed
Mary Polensky
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7
(Mary), the bookkeeper for Bensco, Shirleys Trust, and other
Benson companies,
see 3 RR 123, 199-200, 267, 4 RR 7, 13, 23, to relocate her
office in secret and tell
no one where she was going. 4 RR 52, 59. Until then, Marys
office was at Renson,
where Renee and Roddy worked. 3 RR 130, 268. Mary prepared a
weekly report of
account activity for Renee and Roddy, and she responded to their
requests for
information on related matters. 3 RR 124-25, 269.
In early December 2014, Roddy noticed that Mary was absent from
the
Renson holiday party and thought that quite odd. 3 RR 129. When
Roddy came to
work the following Monday, Marys office was empty, and her
computer and files
were gone. 3 RR 130. He and Renee attempted to learn her
whereabouts and left a
message on her cell phone, 4 RR 53-54, but, obeying Toms
directive, Mary never
returned the call. 4 RR 49, 55, 59. They did not see her again
for almost two
monthswhen she testified on the second day of the evidentiary
hearing regarding
temporary relief. See 4 RR 7-60. In fact, when Renee testified
on the first day of the
hearing, she stated that she still did not know where Mary was.
3 RR 268. As they
learned the next day from Marys testimony, she had moved her
office from Renson
to Toms San Antonio condominium. 4 RR 12-13.
All of Toms actions, culminating in putting the Bank at risk by
the $25
million withdrawal and attempting to fire half of the Board,
plus his refusal to
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8
communicate with Renee in any way, ultimately placed Renee in
the unfortunate
position of bringing an action to remove him as Trustee of
Shirleys Trust.
After a two-day evidentiary hearing, the Bexar County Probate
Court No. 2
granted limited temporary relief. See CR 76 (Order Suspending
Trustee and
Appointing Temporary Co-Receivers with Restrictions [2/9/2015]);
id. at 98
(Amended Order [2/18/2015]); 1 Supp. CR 4 (Second Amended Order
[3/2/2015]);
id. at 13 (Addendum to Order).
Tom travelled from New Orleans to San Antonio and was in San
Antonio
during the hearing, see 4 RR 9, 132-33, but chose not to testify
or even attend.
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9
SUMMARY OF THE ARGUMENT
Toms appeal rests principally on the flawed premise that
trustees enjoy
virtually unfettered discretion in carrying out their duties and
none of Toms actions
amounted to a breach of trust under the wide latitude trustees
are afforded. While it
is true that a trustees discretion is considerable, it cannot be
arbitrary, unreasonable,
capricious or motivated by hostility such that the trustees
fiduciary obligation to the
beneficiary is or potentially will be affected. The issue
presented is whether the trial
court had before it any evidence that Toms statements and
actions had the potential
to affect his fiduciary obligation to the beneficiary of
Shirleys Trust. It surely did.
A few days after Christmas, Tom suddenly severed all
communication with
Renee, and her children. In light of the previously close
relationship they had
enjoyed, this precipitate action alone would call into question
his fiduciary capacity.
But Tom did not stop there. He abruptly, with no explanation and
for no apparent
reason,
removed substantial funds (12% of deposits) from a bank owned
largely by
the Trust and attempted to remove half of its Board of Directors
(including
the beneficiary and her children), impair[ing] the banks [sic]
function and
negatively impact[ing] the trust, 1 Supp. CR 13-14;
instructed the bookkeeper who was the custodian of key
information about
Trust assets to abscond with the records and not communicate
with the
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10
beneficiary, thus insuring that the beneficiaries could not be
informed about
the trust in the future,1 Supp. CR 14;
terminated monthly maintenance-and-support distributions that he
had been
making to the beneficiary for decades;
failed to pay taxes and insurance for trust assets; and
collapsed the beneficiarys business that supervised and managed
the
Trusts car-dealership assets.
1 Supp. CR 14-15. Though afforded three intervening days between
hearings to
reverse his decisions or explain his actions, Tom chose to
continue his course with
no explanation. Id. Not only did Toms actions negatively impact
Shirleys Trust,
they demonstrated ill-will or hostility toward the beneficiary
that posed an imminent
danger to performance of his fiduciary obligations as
Trustee.
Applying established law to these largely undisputed facts
demonstrates that
the trial court acted well within its discretion to preserve the
assets of Shirleys Trust
pending final trial.
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11
STANDARD OF REVIEW
The trial courts appointment of a receiver and grant of a
temporary injunction
are reviewed for abuse of discretion. Benefield v. State, 266
S.W.3d 25, 31 (Tex.
App.Houston [1st Dist.] 2008, no pet.). Generally, a trial court
abuses its
discretion when it acts without reference to guiding rules or
principles of law or
misapplies the law to the established facts. Orix Capital Mkts.,
LLC v. La Villita
Motor Inns, J.V., 329 S.W.3d 30, 44 (Tex. App.San Antonio 2010,
pet denied).
The trial court does not abuse its discretion if it bases its
decision on conflicting
evidence and some evidence supports its decision. Unifund CCR
Partners v. Villa,
299 S.W.3d 92, 97 (Tex. 2009).
ARGUMENT
I. The trial court did not abuse its discretion in suspending
the Trustee pending trial and appointing temporary receivers.
Before examining Toms specific complaints, it is important to
first consider
the basic legal framework for deciding a trust case.
A. A trustee is a fiduciary whose duties are prescribed by the
instrument that created the trust, statutes, and common law.
A trustees duties are defined by the instrument that created the
trust and by
the Texas Trust Code and, when consistent with those, the common
law. TEX. PROP.
CODE 113.051. The instrument that created the Trustthe Last Will
and Testament
of Shirley L. Bensonexplicitly incorporates the Texas Trust Act
and any
amendments thereto, and imposes no additional or contrary duties
relevant to this
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12
proceeding. See 3B RR Plfs Ex. 1, VII.F. Therefore, the Trust
Code and the
common law regarding trustees and fiduciary duties govern this
case.
A trustee has a fiduciary duty towards a beneficiary. Huie v.
DeShazo, 922
S.W.2d 920, 923 (Tex. 1996). The Texas Supreme Court has defined
fiduciary
very broadly:
It is impossible to give a definition of the term that is
comprehensive enough to cover all cases. Generally speaking, it
applies to any person who occupies a position of peculiar
confidence towards another. It refers to integrity and fidelity. It
contemplates fair dealing and good faith, rather than legal
obligation, as the basis of the transaction. The term includes
those informal relations which exist whenever one party trusts and
relies upon another, as well as technical fiduciary relations.
Kinzbach Tool Co. v. Corbett-Wallace Corp., 160 S.W.2d 509,
512-13 (Tex. 1942).
In particular, trustees owe beneficiaries duties of competence
and loyalty, and a
fiduciary duty of full disclosure of all material facts known to
them that might affect
[the beneficiaries] rights. Huie, 922 S.W.2d at 923 (quoting
Montgomery v.
Kennedy, 669 S.W.2d 309, 313 (Tex. 1984)). One who occupies a
fiduciary
relationship to another must measure his conduct by high
equitable standards, and
not by the standards required in dealings between ordinary
parties. Abetter
Trucking Co. v. Arizpe, 113 S.W.3d 503, 508 (Tex. App.Houston
[1st Dist.] 2003,
no pet.). A fiduciary duty encompasses at the very minimum a
duty of good faith
and fair dealing, and it requires a party to place the interest
of the other party before
his own. Id.
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13
B. The beneficiary demonstrated both actual and threatened
breaches of trust under 114.008(a) of the Property Code.
The Trustees principal argument is that he committed no actual
breach of
trust. Trustee Br. at 9-10, 21. But this ignores both the trial
courts findings and
114.008(a)s plain language. According to the trial court, [i]t
appears the
respondent trustees defense is that his actions do not
constitute a trust breach. The
court disagrees. 1 Supp. CR 16. And the statute hinges its
remedies on a breach of
trust that has occurred or might occur, for either of which the
court may:
enjoin the trustee from committing a breach of trust;
suspend the trustee; or
appoint a receiver to take possession of the trust property
and
administer the trust.
TEX. PROP. CODE 114.008(a)(2), (5), (6).
A trustees breach of statutory or common-law fiduciary duty
constitutes a
breach of trust. See TEX. PROP. CODE 114.001(b) (circumscribing
trustees personal
liability to breach of statutory duties or . . . any other
breach of trust); see also Tex.
Commerce Bank, N.A. v. Grizzle, 96 S.W.3d 240, 249 (Tex. 2002)
(recognizing that
the Trust Code imposes certain obligations on a trusteeincluding
all duties
imposed by the common law . . . .).
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14
C. Tom committed an actual, or at least a threatened, breach of
Shirleys Trust by severing all contact with Renee.
By unilaterally cutting off all communication with the
beneficiary, Shirleys
and Toms sole surviving child Renee, Tom breached Shirleys Trust
by disabling
himself from performing his duties as Trustee under the
following provision of the
Trust:
During the lifetime of my said husband, the Trustees shall have
the power to pay to my children from the principal such amounts as
are in their sole discretion necessary to provide adequately for
the health, maintenance and support of my said children.
Trust VI.C. A Trustee cannot properly carry out his fiduciary
duty to a beneficiary
when he has forbidden the beneficiary from even contacting
him.
1. A trustee does not have unlimited discretionhe must act with
the state of mind the settlor contemplated he should act.
The provision of Shirleys Trust quoted above vests discretion in
Tom, as
Trustee, to make distributions to his and Shirleys sole
surviving child, Renee, for
health, maintenance and support. Despite that broad grant of
discretion, the Texas
Supreme Court has made clear that a trustees discretion is not
unlimited. See First
Natl Bank of Beaumont v. Howard, 229 S.W.2d 781 (Tex. 1950). In
Howard, the
Court considered a will creating a spendthrift trust that vested
in the trustee sole
and uncontrolled discretion to make distributions to the
beneficiaries out of the
corpus of the estate, and that further provided the decision of
the Trustee shall be
final and conclusive. Id. at 783.
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15
Notwithstanding this broad grant, the Court held there are
limits to a trustees
discretion, and that the settlors state of mindin our case,
Shirleys state of mind
ultimately controls:
[A]lthough the trustees discretion is declared to be final and
conclusive, the courts will interfere if it acts outside the bounds
of a reasonable judgment. In other words, the terms final and
conclusive do not vest an unlimited discretion in the trustee. The
test to be applied is: When it makes payments to the beneficiaries
out of the corpus of the estate is the trustee acting in that state
of mind in which the settlor contemplated that it should act?
Id. The Court identified several factors to be considered in
determining the settlors
state of mind:
Since the settlors intention as to payments from the corpus of
the trust estate is not made clear by the language used, we must
determine it by a consideration of [1] the value of the estate, [2]
the previous relations between [the settlor] and the beneficiaries,
and [3] all the circumstances in regard both to the estate and the
parties existing when the will was made and when the settlor
died.
Id.
2. By severing all contact with Renee, Tom failed to act as the
settlor, Shirley, contemplated he should, and thereby breached or
threatened to breach Shirleys Trust.
Examining the Howard factors here, it is undisputed, first, that
the value of
the estate at issue is substantial. Second, the unrefuted
testimony shows that the
settlor, Shirley, enjoyed a close, loving relationship with her
three children,
including her sole surviving child, Renee, who she named as the
Successor Trustee
of her Testamentary Trust. 3 RR 153; 3B RR Plfs Ex. 1, 2nd
Codicil, VIII. Finally,
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16
it is undisputed that at the time Shirley made her Will, Tom was
already financially
secure and well on his way to becoming even more securehe is
currently included
on the Forbes list of 400 wealthiest Americans, with a 2014 net
worth of $1.6
billion.2
Considering these factors, the most reasonable conclusion is
that Shirley
intended that, as Trustee, Tom would lovingly evaluate the
health, maintenance and
support needs of his and Shirleys children, and, considering
that Tom was already
financially secure, make appropriately generous provision for
their needs. The
evidence shows that for years Tom acted accordingly. The
undisputed evidence
shows that for twenty yearsfrom 1994 until the end of 2014Tom
made
distributions for maintenance and support to Renee from Shirleys
Trust in the
amount of $10,000 per month. 3 RR 164.
But Tom abruptly cut off these monthly distributions at the
beginning of 2015.
The last time Renee received a $10,000 check from the Trust was
in December 2014.
3 RR 207-08. That check was dated December 1, 2014. See 3B RR PX
19. Renee
did not receive a distribution check in either January or
February 2015. 3 RR 207-
08.
2 See http://www.forbes.com/profile/tom-benson/?list=forbes-400
(last visited 7/10/2015).
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17
Toms cessation of these distributions was arbitrary and
capricious. He did
not tell Renee that he was planning to stop the distributions,
nor ever explain to her
why he did. 3 RR 208. In two days of testimony, no witness
provided any
explanation for the cutoff of Renees maintenance and support.
The Trustee himself
neither testified nor attended the hearing, even though he was
in San Antonio at the
time. See 4 RR 9, 132-33. Even when a fiduciary has discretion
in carrying out his
duties, he still must act reasonably and in good faith. Howard,
229 S.W.2d at 783;
Sassen v. Tanglegrove Townhouse Condo Assn, 877 S.W.2d 489, 492
(Tex. App.
Texarkana 1994, writ denied). Arbitrary or capricious conduct
is, by definition,
neither reasonable nor in good faith. Id.
The abrupt cutoff of Renees monthly distributions can only be
explained by
Toms hostile state of mind in his likewise abrupt decision to
sever all contact with
Renee and his grandchildren, Rita and Ryan. In a December 27,
2014, letter
addressed to them, Tom declared: I want no further contact with
any of you and
you will not be allowed to enter the Saints facilities or games,
the Basketball
facilities or Pelicans games, the Benson Towers, the T.V.
facilities or the automotive
facilities in New Orleans . . . . 3B RR Ex. 20.
Of course, no family is forever guaranteed a close, loving
relationship.
Generally, a father is perfectly free to sever all contact with
children, grandchildren,
or whatever family member he chooses. But not when he has been
bestowed with
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18
fiduciary obligations. Shirley made Tom the Trustee of a
substantial estate of which
Renee is a current beneficiary and, when Tom passes away, will
pass largely to
Renee and her children. 3 RR 159. Simply put, if a trustee
unilaterally cuts off all
communication with a beneficiary, the trustee cannot properly
evaluate whether that
beneficiary has needs for health, maintenance and support, and,
if so, the amount of
distributions appropriate to meet those needs.
The fact that Tom was purportedly upset with Renee and her
children in no
way diminishes his fiduciary obligations as Trustee. In his
December 27, 2014,
letter, Tom states generally that Renee, Rita, and Ryan became
offensive and did
not act in an appropriate manner after [the Trustee] remarried.
3B RR Ex. 20.
The only specific conduct he complains of is that Renee, Rita,
and Ryan had
arguments among [them] selvesthey had supposedly created an
unpleasant
family situation after [he] remarried. Id. But that is a
personal grievance. Personal
hurt cannot justify a trustees cutoff of communication with a
beneficiary.
Wherever the fault lies for the unpleasant family situation, the
trust
relationship remains intact, and communication is a critical
component of that
relationship. In fact, a trustees hostility toward the
beneficiaries is a ground for the
trustees removal. See Akin v. Dahl, 661 S.W.2d 911, 914 (Tex.
1983); Barrientos
v. Nava, 94 S.W.3d 270, 286 (Tex. App.Houston [14th Dist.] 2002,
no pet.).
Removal is justified if (1) the trustee had hostility toward the
beneficiaries, or people
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19
associated with them, and (2) the hostility does or will affect
[the trustees]
performance in the office. Akin, 661 S.W.2d at 914 (removal of
trustee pursuant to
jury trial was not justified absent a finding that hostility has
affected or will affect
trustees performance); Barrientos, 94 S.W.3d at 288 (removal of
trustee was
justified because hostility toward mother of minor beneficiaries
would impair
trustees ability to disburse funds consistent with minors best
interests).
Removing the family-dynamic overlay, assume that instead of her
husband
Tom, Shirley had named the Trust Department of Frost Bank as
Trustee. Further
assume that after twenty consecutive years of making monthly
maintenance-and-
support distributions to Renee, Frost Bank, with no explanation,
terminated those
distributions and wrote a letter to Renee and her children
declaring: Frost Bank
wants no further contact with any of you and you will not be
allowed to enter Frost
Banks facilities. Under these circumstances, is there any way it
could be said that
Frost Bank act[ed] in that state of mind in which the settlor
[Shirley] contemplated
that it should act? Howard, 229 S.W.2d at 783. Of course notany
court would
legitimately find such conduct by a banks trust department to
constitute a breach of
the trust. The analysis and result should be no different when
the Trustee happens to
be the fathereven an upset fatherof the Trusts principal
beneficiary.
Here, the Trustees December 27, 2014, letter is evidence that
his hostility
toward Renee, Rita, and Ryan for ostensibly creating an
unpleasant family
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20
situation led him to sever all communication. A severing of
communication will
almost by definition affect [the trustees] performance in the
office. Akin, 661
S.W.2d at 914. And it unquestionably has the potential to do so.
Because the
Trustees hostility was sufficient ground for his removal, it was
certainly sufficient
to support the lesser remedy of temporary suspension and
appointment of co-
receivers pending final trial.
D. Tom breached, and threatened to breach, the Trust through his
actions directed at Lone Star Capital Bank.
The Trust Code provides that [a] trustee shall invest and manage
the trust
assets solely in the interest of the beneficiaries. TEX. PROP.
CODE 117.007.
Shirleys Trust owns over 97% of the Bank, 3 RR 49, making it a
significant Trust
asset. As demonstrated below, Tom committed an actual and
threatened breach of
trust by (i) abruptly transferring nearly $25 million out of the
Bankincluding $4.76
million in cash owned by the Trustwith no explanation or evident
justification;
and (ii) attempting to remove half of the Banks Board of
Directorsincluding the
Chairman of the Board, the Vice-Chairman, and Reneeagain, with
no explanation
or evident justification. Those actions impaired the banks [sic]
functions and could
cause other depositors concern, thus threatening the Banksand by
extension
Shirleys Trustswell-being. 1 Supp. CR 13-14.
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21
1. Tom breached the Trust by abruptly transferring $25
millionover 12% of total depositsout of the Bank.
As Trustee of the Trust that owns over 97% of the Bank, Tom
controls the
appointment of the Board of Directors, and so the Bank. 4 RR 80.
He is also a
director of the Bank. 4 RR 63. Shortly before Christmas 2014,
the Banks President
and CEO, Danny Buck, was informed through back channels that Tom
might move
funds from the Bank. 4 RR 62, 66-67. On January 7, 2015, Tom
directed that nearly
$25 million be transferred from the Bank to new accounts Tom
opened at Frost Bank.
4 RR 68-69, 71. Of that $25 million, $4.76 million belonged to
Shirleys Trust. 3
RR 119.
Bank President Buck testified that its not a good thing for the
bank to lose
that amount of deposits. 4 RR 83. In order to make an initial
transfer of
approximately $17 million, the Bank was forced to deplete
approximately $11
million of funds held in correspondent banks, and pull another
$6 million from the
Banks Fed funds account. 4 RR 85-86. To fund the remainder of
the transfer, the
Bank had to liquidate securities in its portfolio and obtain a
short-term loan of $3
million from the Federal Home Loan Bank. 4 RR 86.
The $25 million that Tom withdrew represented over twelve
percent of the
Banks $203 million in deposits. 3 RR 80; 4 RR 87. A bank of this
size normally
does not get an order to withdraw this much money at one time. 3
RR 78. Managing
that magnitude of a withdrawal constituted a crisis for the
Bank. 4 RR 86. Although
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22
Buck managed the crisis well, this was the first time in his
34-year career in banking
that he had to manage a crisis created by the owner of the bank
himself. 4 RR 62,
86.
A reduction in bank deposits of this magnitude has no impact on
the book
value of a bank. 4 RR 87. But it has the obvious and significant
potential to
negatively impact a banks market value. 3 RR 79; 4 RR 87-88.
When asked by the
Court if a customer of a bank this size would be nervous to
learn about a withdrawal
of such magnitude, Buck replied: Sure. 4 RR 93-94. When asked
about the
withdrawals effect on the publics trust in the Bank, Buck
responded, it doesnt
look good. 4 RR 94.
During the two-day hearing, no evidence was presented of any
justification,
much less a compelling need, for Tom to suddenly transfer $25
million to Frost
Bank. No explanation was ever given to either the Banks Chairman
or its President
as to why Tom directed that transfer. 3 RR 80. Toms only
response is that he had
the legal right and authority to make the transfer. But that is
not the point. The point
is that his disconcertedly sudden withdrawal, 1 Supp. CR 13, of
such a large
amount affirmatively jeopardized the Banks financial integrity.
Absent any
countervailing interest or justification for such a precipitous
action, Toms exercise
of fiduciary discretion was arbitrary, capricious and, when
placed in context with his
statements and other actions, apparently motivated by nothing
more than hostility
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23
toward Renee. By taking affirmative steps likely to place a
Trust asset at risk of
devaluation, Tom did not manage the trust assets solely in the
interest of the
beneficiaries. TEX. PROP. CODE 117.007. See Abetter Trucking,
113 S.W.3d at
508.
2. Tom actually breached the Trust, or at the least threatened
to, by attempting to fire half of the Banks Board of Directors
without cause.
On January 17, 2015, the Bank provided notice of a Special
Meeting of
Shareholders, the sole purpose of which was to remove five of
the ten members of
its Board of Directors: Roddy, McCandless, Renee, Rita, and
Ryan. 3B RR Ex. 6; 3
RR 83. Tom was the person behind this attempt to remove half of
the Board
members. 4 RR 81. And the only thing that prevented this from
happening was a
temporary restraining order issued by the probate court. Id.
Three of the directors Tom tried to remove occupy key positions
on the Board:
Tom Roddy has served as Chairman of the Board since the Bank
was
acquired by Shirleys Trust and became Lone Star Capital Bank. 3
RR 50, 63.
He testified about his intention to step down as Chairman in May
2015 on his
75th birthday and become Chairman Emeritus. 3 RR 137.
Bill McCandless was one of the Banks original directors. 3 RR
52. He serves
in a dual role as both Vice-Chairman of the Board and officer,
and also chairs
the directors loan committee. 4 RR 79-80. Roddy testified that
McCandless
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24
was slated to become Chairman of the Board when Roddy stepped
down. 3
RR 137. Between them, Roddy and McCandless have 80 years of
banking
experience in San Antonio. 3 RR 52.
Renee Benson has served as a director of the Bank since its
acquisition by the
Trust. 3 RR 63. Renee has been a very active member of the
Board, serving
on the audit, compliance and policy committees, and chairing
the
compensation committee. 4 RR 78-79. She participated with Roddy
in
recruiting Danny Buck to become its President. 4 RR 78.
Had Tom been successful in ousting these three directors, it
would
undoubtedly have been detrimental to the Bank. 4 RR 81. As Bank
President Buck
testified, Its never good to have a disruptive board. Id..
Relationships are very
important in the small banking industry. 3 RR 82; 4 RR 81.
McCandless in particular
has substantial relationships with the businesses in and around
San Antonio that do
business with the Bank. 4 RR 81-82. Given their combined 80
years of banking
experience in San Antonio, Roddy and McCandless, if fired, could
have taken a
substantial number of the Banks deposits and loans with them to
another bank. 3
RR 82. Buck never lobbied Tom to have Chairman Roddy or
Vice-Chairman
McCandless removed from the Board, and it never would have
occurred to him as
President that that would have been in the Banks best interest.
4 RR 82. At the time
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25
Tom sought to have them ousted, the Bank was both profitable and
growing. 4 RR
83.
No one at the hearing provided any explanation as to why Tom
sought to have
these key directors removed, much less why removing them would
have been in the
best interest of the Bank. The only evidence was to the
contrarythat it would not
have been in the Banks best interest. Thus, Tom breached his
fiduciary duty to the
Trust and its beneficiaries by attempting this hostile move that
would have harmed
the interest of this key Trust asset. In acting as he did, Tom
did not manage the trust
assets solely in the interest of the beneficiaries. TEX. PROP.
CODE 117.007.
E. Tom committed an actual, and a threatened, breach of trust by
hiding the bookkeeper.
Tom instructed the Trusts bookkeeper, Mary Polensky, to
surreptitiously
move out of the Renson offices, hide in his personal
condominium, and refrain from
communicating with Renee, thus violating his duty of full
disclosure by insuring
that the beneficiaries could not be informed about the trust in
the future. CR 85.
Trustees owe beneficiaries a fiduciary duty of full disclosure
of all material facts
known to them that might affect [the beneficiaries] rights. Huie
v. DeShazo, 922
S.W.2d at 923 (quoting Montgomery, 669 S.W.2d at 313). The
existence of strained
relations between the parties [does] not lessen the fiduciarys
duty of full and
complete disclosure. Montgomery, 669 S.W.2d at 313.
-
26
In early December 2014, Roddy noticed that Mary was absent from
the
Renson holiday party and thought that quite odd. 3 RR 129.
Unbeknownst to him,
Tom had ordered her to move out of the Renson offices. 3 RR 251.
Tom told her,
dont tell anybody that youre moving, just be there on a Friday,
and then on
Monday be gone. 4 RR 59.
When Roddy came to work the following Monday, Marys office
was
emptyher computer and files gone. 3 RR 130. He and Renee
attempted to learn
her whereabouts and left a message on her cell phone, 4 RR
53-54, but Mary never
returned the callagain, on Toms orders. 4 RR 45, 49, 55, 59. He
said, dont tell
anybody where you are and dont talk to them. 4 RR 59.
Roddy and Renee did not see Mary again for almost two monthswhen
she
testified on the second day of the evidentiary hearing. See 4 RR
7-60. In fact, when
Renee testified the day before, she still did not know Marys
whereabouts. 3 RR 268.
As they learned the following day from Marys testimony, she had
moved her office
from Renson to Toms San Antonio condominium. 4 RR 12-13. Toms
intentional,
premeditated actions in denying Renee access to the bookkeeper
of Shirleys Trust
amounted to a breach of trust, and threatened a continuing
breach of trust in the
future. These actions justified Toms suspension as Trustee and
the appointment of
temporary receivers.
-
27
F. Though actual harm to the Trust was shown, no showing of harm
or less intrusive methods is required.
Tom asserts that no evidence supports a temporary receivership
because the
Trust had suffered no harm. This complaint lacks merit. The
trial court expressly
found that the Trustees actions and statements of motivation
negatively impacted
the trust, 1 Supp. CR 13, and there was ample support in the
evidence. Moreover,
the Texas Trust Code does not require harm to have actually
occurred. It authorizes
suspension of the trustee and appointment of a receiver to
remedy a breach of trust
that . . . might occur. TEX. PROP. CODE 114.008(a) (emphasis
added). In other
words, it authorizes prevention of damage. Id. Accordingly, no
showing of actual
harm is required.
Also contrary to Toms contention, the statute contains no
requirement that
less intrusive remedies be considered before appointing a
receiver. Id.
114.008(a)(5). To the contrary, all of the remedies 114.008(a)
authorizes are
equally available, in the trial courts discretion. Id.
114.008(a). For example, the
statute authorizes a court to:
compel the trustee to perform the trustees duty or duties, id.
114.008(a)(1);
compel the trustee to redress a breach of trust, id.
114.008(a)(3); or
appoint a receiver, 114.008(a)(5).
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28
The statute does not place those remedies into a hierarchy or
condition the
appointment of a receiver on the inadequacy of alternative
relief.
The Trustee cites cases that condition statutory receiverships
on the absence
of other remedies, but in most of those decisions the statutes
themselves contained
the requirement. See Trustee Br. at 24 (citing Benefield, 266
S.W.3d at 32-33
(applying Texas Business Corporations Act); and Chapa v. Chapa,
No. 04-12-
00519-CV, 2012 WL 6728242, at *6 (Tex. App.San Antonio Dec. 28,
2012, no
pet.) (mem. op.) (applying Texas Business Organizations Code).
In the remaining
case, the statement Tom cites is dicta that offers little
support for his contention.3 By
contrast, 114.008(a) has no such requirement.
In any event, the trial court was well within its discretion to
conclude that an
injunction alone would be inadequate. A mandatory injunction
ordering the Trustee
to resume communication with Renee would have been difficult, if
not impossible,
to enforce. The trial court could have had good reason to
believe that policing the
3 In Elliott, the court applied the requirement that other
remedies must be inadequate even though 114.008 was one possible
ground for the appointment of the receiver. Elliott v. Weatherman,
396 S.W.3d 224, 228-29 (Tex. App.Austin 2013)(no. pet.). This was
dicta, as the receivership failed for lack of notice, id. at 228,
and as the other source of authority was 64.001 of the Civil
Practice and Remedies Code, which incorporates the rules of equity.
Id.; see TEX. CIV. PRAC. & REM. CODE 64.001(a)(6). Moreover,
Elliotts dicta relies on Benefield and Fortenberry v. Cavanaugh,
No. 03-04-00816-CV, 2005 WL 1412103, at *2-3 (Tex. App.Austin June
16, 2005, no pet.) (mem. op.) in which receivers were predicated on
the Business Corporations Act, which expressly prescribed a
requirement that all other remedies be inadequate.
-
29
quantity and quality of Toms communication with Renee would have
been an
unmanageable task.
For example, consider what Tom managed to achieve, or attempted
to achieve,
within the space of just a few weeks: he cut off all
communication with his child and
grandchildren; he removed $25 million from a bank 97% owned by
the Trust, $4.86
million of which were Trust assets; he attempted to remove half
of the members of
the Banks Board of Directors, including its Chairman and
Vice-Chairman; he
successfully engineered the after-hours disappearance of a
bookkeeper who was the
custodian of key information about Trust assets; he cut off
monthly maintenance-
and-support distributions that had been made to the beneficiary
for twenty years; and
he deliberately gutted the beneficiarys business. It would have
been virtually
impossible for the court to fashion an injunction that could
anticipate the nature and
extent of potential damage that Toms hostility toward the
beneficiary might cause.
Even so, the trial court gave careful consideration to the
competing interests
and granted narrowly tailored relief. The trial court
temporarily suspended Tom as
Trustee and made a limited temporary appointment of co-receivers
[with
restrictions] . . . [as] immediately necessary for purposes of
managing and
conserving the Trusts [and the Estates] property during
litigation . . . CR 76; Order
at 1. Moreover, the trial court has closely supervised the
Co-Receivers, issuing
further instructions and clarifications as necessary.
-
30
G. The Trustee had ample notice that a receivership had been
requested.
The Trustee creates the false impression that the trial court
ambushed him
when it appointed the co-receivers. See Trustee Br. at 34-36. He
complains that (1)
he never received notice of the grounds for Petitioners
application to appoint
receivers, (2) no evidence or argument has been presented on
whether to appoint
a receiver, and (3) the issue of appointing a receiver only
arose after the conclusion
of evidence. Id. at 35. In fact, the Trustee had ample notice
that a receivership was
at issue, and he introduced evidence attempting to disprove the
breaches of trust:
Renee requested a receivership in her original petition, filed
on January
21, 2015. CR 5, 16 (describing breaches and potential breaches
of trust
and requesting appointment of a temporary receiver for the
purpose
of conserving and managing the trust assets pending final
trial).
Renees counsel sent a letter to the trial court on February 3,
2015, with
a copy to counsel for the Trustee, summarizing the issues for
the
hearing and stating, a Receiver should be appointed as soon
as
possible. Appendix 2.4
4 Renees counsel has requested the trial courts clerk to prepare
a Supplemental Record including the letter, which will then be
forwarded to this Court together with a request to supplement the
record.
-
31
Renees counsel orally renewed the request for a temporary
receivership in his opening statement on Day 1 of the hearing. 3
RR 4.
Later the same day, counsel for the Trustee conceded: Theyve
asked
for a receivership. 3 RR 286.
The Trustees contention that Renee, or the trial court, ambushed
him with the
receivership is simply not true.
The Trustees complaint seems to be that the word receivership
did not
appear in the paragraph of the temporary restraining order that
set a hearing date for
the temporary injunction. See Trustees Br. at 34-35. The Trustee
cites no authority
that an order can be reversed on such flimsy grounds. Contrary
to the Trustees
contention, Elliott does not support this proposition. In
Elliott, the court reversed an
order appointing a receiver not for an alleged defect in the
formal notice of the
hearing, but because no party had pleaded or even mentioned
receivership until after
the evidence closed. Elliott v. Weatherman, 296 S.W.3d 224, 229
(Tex. App.
Austin 2013) (no pet.) (Accordingly, we conclude that Weatherman
has not pled an
application for receivership, and there is nothing in the record
suggesting that Elliot
and Clem otherwise had notice prior to the hearing that
Weatherman would request
such relief.).
The record demonstrates that the Trustee was on full notice that
a receivership
was at issue. In fact, he claims no actual surprise. When the
subject of receivership
-
32
came up during opening statements, 3 RR 34 (We absolutely we
want a receiver,
your Honor), the Trustees attorneys did not object, complain
about lack of notice,
or request a continuance.
The Trustees conduct and express statements negate any
suggestion of
surprise, and his failure to object at the hearing and request a
continuance waives
any complaint about notice. See Negrini v. Beale, 822 S.W.2d
822, 823 (Tex. App.
Houston [14th Dist.] 1992, no pet.) (holding that party waived
lack of 21-day notice
for summary-judgment hearing where the party actually received
notice, appeared
at hearing, filed no controverting affidavit, and did not
request a continuance).
Further, he has not even arguedmuch less demonstratedharm. He
does not
explain what additional evidence he would have introduced if the
word
receivership had appeared in the TRO.
Notice of statutory authority for receivership. Tom also
complains that the
trial court anchored the receivership in 64.001(a) of the Civil
Practice and
Remedies Code in addition to the statute Renee pleaded114.008 of
the Property
Code. But such an addition does not undermine the Order, and Tom
cites no
authority that it does.
II. The trial courts order complies with Texas Rule of Civil
Procedure 683.
The Trustee contends the Second Amended Order is void for
failure to meet
the requirements of Texas Rule of Civil Procedure 683, which
provides that
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33
temporary injunctions must identify the reasons for an
injunction. Trustee Br. at 38-
40. More specifically, the Trustee argues that the order does
not identify the probable
harm absent an injunction and how that harm is irreparable. Id.
at 39-40. In the
Trustees view, the trial court provided only a conclusory
rationale, and the Court
should conclude that the temporary injunction, as well as the
order appointing the
co-receivers, is thus void. The Trustees argument has no merit
because: (1) the order
appointing co-receivers is not governed by Rule 683; and (2) the
trial court supplied
sufficient reasons for the injunction in its review of the
Trustees actions and
statements and their effect on the Trust.
A. The appointment of receivers is not an injunction, and thus
not within Rule 683s purview.
The Trustee erroneously asserts that any noncompliance with Rule
683
renders the injunction, as well as the receivership, order void.
Trustee Br. at 40. But
the Trustees Rule 683 challenge can extend no further than the
scope of the rule
itselfthe injunctive portion of the order. By its plain terms,
Rule 683s reach is
limited to orders granting an injunction. TEX. R. CIV. P. 683.
Moreover, the Trust
Code and the Civil Practice and Remedies Code are independent
sources of the trial
courts authority to appoint the co-receivers. See TEX. PROP.
CODE 114.008(a)(5)
(authorizing appointment of receiver as remedy for breach of
trust); TEX. CIV. PRAC.
& REM. CODE 64.001(a) (providing for possible remedy of
receivership); see also
1 Supp. CR 4 (citing both statutory provisions).
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34
Sections 114.008(a)(5) and 64.001(a)not Rule 683govern the
receivership orders requirements. See, e.g., Onoray Davis
Trucking Co., Inc. v.
Lewis, 635 S.W.2d 622, 624-25 (Tex. App.Houston [14th Dist.]
1982, writ
dismd) (rejecting challenge to temporary injunction for lack of
compliance with
Rules 680, 682, 683, and 684 because those rules were inapposite
when the probate
court was acting under its power to preserve estate assets and
effectuate its decrees).
Significantly, the Trustee raises no voidness challenge to the
order appointing the
co-receivers on the basis of Section 114.008(a)(5) or Section
64.001(a). This aspect
of the Trustees argument fails.
B. The temporary injunction complied with Rule 683, and thus was
not an abuse of discretion.
The Trustee contends the temporary injunction is void because it
states only
conclusory reasons regarding irreparable harm. But even a
cursory review of the
order demonstrates that its reasons are amply sufficient. The
order states that the
Trustee is enjoined from a list of specific acts related to the
Trust because the Trustee
will commit those acts and Renee will be irreparably harmed for
the reasons
provided in the Addendum to the Order. 1 Supp. CR 5-6. The trial
court then details
its reasonsactions and statements of the Trusteein the Addendum,
which is
incorporated by reference. See id. at 5, 13. The trial court
explains that its injunction
was prompted by the following actions and statements by the
Trustee, with the
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35
critical areas of concern being the no contact letter and the
movement of the trust
records and funds. Id. at 15-16.
1. Sudden, inexplicable withdrawal of trust funds from Lone Star
Capital Bank (1 Supp. CR 13-14)
The trial court concluded that the Trustees withdrawal from Lone
Star Capital Bank was likely to harm the Trust because it was 12%
of the banks capitalization and the bank is 97% owned by the Trust.
The Trustees fear about the safety of the money was particularly
unwarranted because the Trustee appointed all of the banks
long-term executives and board members. The trial court noted that
there was no evidence that the transferred funds remained at Frost
Bank. The court also observed that both sides presented evidence
that the withdrawal of the funds impaired the trust-owned banks
functions and could cause concern to other bank depositors.
2. Testimony by Trustees bookkeeper that Trustee told her to
abscond with the Trust and records (1 Supp. CR 14)
The trial court regarded this direction as a sudden departure
from the historic trust relationship and a breach of the trust
relationship.
3. Trustees letter to beneficiaries ending contact with them,
together with firing the beneficiary and her children while also
ending decades-long payments (1 Supp. CR 14-15)
The trial court concluded that (1) the letter was most contrary
to the evident intentions of the settlors of the Trust when it was
established; (2) evidence of Renees behavior that could cause such
anger was meager; (3) the letter was in contrast to evidence that
the Trustee revere[d] family, church and friends and particularly
loved his only surviving child; and (4) the letters disclaimer of
all parental care was a serious life-altering change at his
age.
4. Excessive fear exhibited by Trustees statement to a
dealership general manager that he was the only person trusted by
the Trustee in San Antonio (1 Supp. CR 14)
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36
This statement stood in contrast to evidence of the Trustees
trusted relationships with an extensive set of key managers for
decades and that these long-term loyalties were a hallmark of his
business.
5. Trustees health problems (1 Supp. CR 15)
The court took note that all the direct evidence and all the
witnesses agreed that the Trustee has substantial health issues and
this trustee does not seem to be improving. The court identified
this issue as a contributory factor of concern, noting that the
court had decades of experience dealing with the vulnerable and the
Trustee himself confesse[d] that at my age the pressures are too
much.
The court also observed that it had allowed the Trustee three
intervening days
between hearings to reverse his decisions impacting and
breaching the Trustsuch
as returning the trust funds and releasing the trust recordsas
well as an opportunity
to explain his statements, but the Trustee chose not to. Id. at
16. The fact that the
Trustee did not address or rectify his actions was an indication
that they would likely
continue in the future and a further basis for the trial courts
decision to enjoin the
Trustee. Id.
In addition, the court found that the Trustees actions will
likely damage the
trustees local brand [i.e. the Banks brand] significantly over
this next year if not
reversed soon and if the major interested parties were not
reassured by a restoration
of the prior status quo and stability and calmness. Id. The
court further noted that
one Bank executive resigned his duties while on the stand before
the court, and
recognized that time was of the essence. Id.
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37
In short, the trial courts rationale for the temporary
injunction was the
Trustees actions and statements animated by evident hostility,
their negative impact
on the Trust, and anticipated continued breaches of the Trustees
duties. The Trustee
contends the trial court provided only conclusory statements
that Renee would be
irreparably harmed, but in fact the court provided specific
examples of the Trustees
hostile statements and actions, negative impacts on the trust
assets, the Trustees
intent to make trust records unavailable, and a desire to sever
all connections with
the beneficiaries, all of which were a stark contrast with the
Trustees history and
character and, more importantly, with the intent of the Trusts
settlorShirley
Benson.
Further, the court explained that despite being given the
opportunity, the
Trustee had chosen not to alter his course of action or explain
his statements and
actions. In addition, the court identified health issues that
could exacerbate the
circumstances. The trial court specifically observed that the
evidence on the key
areas of concernthe severance of contact and the movement of
trust assets and
recordswas not disputed. The court supplied more than enough
detail of
dissipation and devaluation of trust assets and continued damage
to trust
relationships and the Trustees reputation and business
relationships, all of which
are by definition irreparable injuries.
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38
One of the purposes of Rule 683 is to enable an understanding of
the basis for
the courts ruling. See, e.g., El Tacaso, Inc. v. Jireh Star,
Inc., 356 S.W.3d 740, 747-
48 (Tex. App.Dallas 2011, no pet.). There is no need to
speculate about the basis
for the temporary injunction here given the comprehensive
reasons the trial court
provided. See, e.g., Amalgamated Acme Affiliates, Inc. v.
Minton, 33 S.W.3d 387,
397 (Tex. App.Austin 2000, no pet.) (holding order sufficiently
provided reasons
by stating that appellants conduct was interfering with
appellees relationships with
his customers and advertisers and that appellee was likely to
suffer immediate and
irreparable injury without an injunction).5
The level of detail the trial court provided undermines the
Trustees claim that
its reasons were merely conclusory. Decisions holding temporary
injunctions to be
conclusory on the irreparability-of-harm point are instructive.
They generally
involve mere recitations of no adequate remedy at law and
irreparable harm.
See, e.g., Univ. Interscholastic League v. Torres, 616 S.W.2d
355, 358 (Tex. Civ.
App.San Antonio 1981, no writ) (mere recital of irreparable harm
and no
5 See, e.g., IAC, Ltd. v. Bell Helicopter Textron, Inc., 160
S.W.3d 191, 200 (Tex. App.Fort Worth 2005, no pet.) (holding that
order satisfied requirements by stating that appellee had shown
that appellants had possession of appellees data entitled to
trade-secret protection and were actively using that information to
compete with appellee).
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39
adequate remedy at law does not satisfy Rule 683).6 The court in
this case went far
beyond such cursory statements.
Indeed, the critical prerequisite to a conclusory label is an
absence of
underlying facts. In Arkoma Basin Exploration Co. v. FMF
Associates 1990A Ltd.,
the Texas Supreme Court explained that conclusory means
[e]xpressing a factual
inference without stating the underlying facts on which the
inference is based. 249
S.W.3d 380, 389 n.32 (Tex. 2008)(citing Blacks Law Dictionary
308 (8th ed. 2004)).
Accordingly, an absence of underlying facts to support the
finding that irreparable
injury will occur is a common basis for determining that an
order does not satisfy
Rule 683. See, e.g., Kotz v. Imperial Capital Bank, 319 S.W.3d
54, 56 (Tex. App.
San Antonio 2010, no pet.) (The trial court fails to set forth
any underlying facts to
support its finding that irreparable injury . . . will occur,
making the courts finding
conclusory.) (quotation omitted).
The authorities relied on by the Trustee are in that category.
See Trustee Br.
at 38-39. In Torres, the injunction merely stated that the
plaintiffs had no adequate
6 See also, e.g., Rio Grand Exploration, L.L.C. v. Anju Prod.,
L.L.C., No. 04-08-00495-CV, 2009 WL 618616, at *2 (Tex. App.San
Antonio Mar. 11, 2009, no pet.) (mem. op.) (concluding that reasons
were insufficient when only reason provided was that the property
would be subject to probable irreparable injury, and did not
expressly identify defendants conduct); Monsanto Co. v. Davis, 25
S.W.3d 773, 788 (Tex. App.Waco 2000, pet. dismd w.o.j.) (concluding
that order was insufficiently specific when it stated that
plaintiffs will suffer probable injury); Gen. Homes, Inc. v.
Wingate Civic Assn, 616 S.W.2d 351, 353 (Tex. Civ. App.Houston
[14th Dist.] 1981, no writ) (finding that order did not satisfy
Rule 683 because it only states the trial courts conclusion that
immediate and irreparable harm will result if the injunction is not
granted).
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40
remedy at law and would suffer irreparable harm. 616 S.W.2d at
357. In Tuma v.
Kerr County, 336 S.W.3d 277, 280 (Tex. App.San Antonio 2010, no
pet.), this
Court concluded that a temporary injunction did not comply with
Rule 683 when it
set forth no reasons why injury would result without an
injunction. The Trustees
last-cited decision also stands in contrast to the detail the
trial court provided in this
case. In International Brotherhood of Electrical Workers Local
Union 479 v. Becon
Construction Co., Inc., the court of appeals decided that a
temporary injunction
enjoining a labor union from obstructive mass picketing did not
satisfy Rule 683
when it merely stated that the defendants were in violation of a
Texas Labor Code
provision, but failed to identify a probable injury or how it
was irreparable. 104
S.W.3d 239, 244 (Tex. App.Beaumont 2003, no pet.). The court in
this case did
not provide such perfunctory reasoning. Instead, it provided
extensive underlying
facts in a 4-page Addendum, as discussed supra, belying the
Trustees attempt to
label the order conclusory.
III. Toms due-process challenges to the Amended Order fail.
The Trustee asserts that when the trial court amended its
original order, it
denied him notice of the basis of its rulings and the
opportunity to effectively object,
violating his due-process rights and Texas Rule of Civil
Procedure 21(b). Trustee
Br. at 36-38. The Trustee, however, appears to confuse his
disagreement with the
trial courts rulings with established notice and due-process
requirements. He fails
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41
to: (1) identify a basis for his purported due-process and Rule
21 rights; (2)
demonstrate that he did not receive notice or an opportunity to
be heard on Renees
arguments or the relief sought; or (3) explain how the trial
courts amendments of
its order caused the Trustee harm.
The Trustee invokes Rule 21(b) and due-process rights, using the
term
notice in making his complaint, but fails to identify any
precedent or specific rule
provision to justify his contention. Rule 21(b) concerns only
service on all other
parties of an application to a trial court for an order and
notice of a hearing on the
request.7 And Rule 21(b) imposes that obligation on a litigant,
not a court. Neither
do the remaining provisions of Rule 21 provide support for the
Trustee, as they
concern filing and service, certificates of service, electronic
filing, and the
availability of additional copies of pleadings. See TEX. R. CIV.
P. 21(a), (c)-(f).
The Trustee also cites due process in complaining that the trial
court should
have given him notice and an opportunity to be heard before
amending its order.
Notice and an opportunity to be heard are indeed the key
elements of procedural due
process. See, e.g., Tex. Workers Comp. Commn v. Patient
Advocates of Tex., 136
S.W.3d 643, 658 (Tex. 2004). In asserting a due-process
challenge, however, the
7 The rule requires service on all other parties at least three
days before a hearing on the requested order, unless other rules
provide differently or the court shortens the time period. See TEX.
R. CIV. P. 21(b).
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42
Trustee must establish that his interest was constitutionally
protected. See, e.g., In re
Baby Girl S., 407 S.W.3d 904, 911 (Tex. App.Dallas 2013, pet.
denied), cert.
denied sub nom., Cole v. Generations Adoptions, 135 S. Ct. 1896
(2015). He fails to
even suggest a protected interest in the trial courts original
order.8 Without a basis
for the trial courts supposed obligation, the Trustees argument
fails.
The Trustees due-process complaint regarding the amended
orders
substance is likewise unavailing. The Trustees counsel appeared
at the two-day
hearing, introduced evidence, cross-examined witnesses, and
argued against Renees
contentions and the proposed receivership. They also filed a
letter with the trial court
identifying purported deficiencies in the Courts Amended Order.
The Trustee fails
to show any violation of due process. See, e.g., In re C.F.M.,
360 S.W.3d 654, 660-
61 (Tex. App.Dallas 2012, no pet.) (rejecting argument that due
process required
notice and an additional hearing prior to appointment of
receiver when trial court
had already held multiple hearings where evidence was presented,
which remained
before the court at the time of its ruling).
8 By contrast, some actions do require prior notice and
opportunity to be heard because they involve the deprivation of a
protected interest. See, e.g., Ex parte Blanchard, 736 S.W.2d 642,
643 (Tex. 1987) (order of contempt); In re Hereweareagain, Inc.,
383 S.W.3d 703, 708 (Tex. App.Houston [14th Dist.] 2012, no pet.)
(sanctions for out-of-court conduct); Hunt v. State ex rel. K.C.,
No. 03-11-00352-CV, 2012 WL 3793283, at *2 (Tex. App.Austin Aug.
31, 2012, no pet.) (mem. op.) (family-violence protective order);
Conseco Fin. Servicing v. Klein Indep. Sch. Dist., 78 S.W.3d 666,
676 (Tex. App.Houston [14th Dist.] 2002, no pet.) (default
judgment).
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43
The trial court had discretion to amend its order, and the
Trustee does not
assert otherwise. Texas Rule of Appellate Procedure 29.5 affirms
the trial courts
continuing jurisdiction over a case while an appeal from an
interlocutory order is
pending, and specifically permits the trial court to make
further orders, including
even dissolving the order being appealed. In accordance with
Rule 29.5, the trial
court had authority to modify or amend the original order to
grant substantive relief
and to bring the order into compliance with Texas Civil
Procedure Rules 683 and
684, so long as its actions did not interfere with or impair
this Courts jurisdiction or
the effectiveness of the relief the Trustee seeks on appeal.
See, e.g., Tex. Health &
Human Servs. Commn v. Advocates for Patient Access, Inc., 399
S.W.3d 615, 623-
25 (Tex. App.Austin 2013, no pet.).9
The Trustees argument fails for yet another reason. He does not
even assert
that the purported due-process violation was harmful. See TEX.
R. APP. P. 44.1(a);
Thota v. Young, 366 S.W.3d 678, 687 (Tex. 2012). There is no
indication what
argument or evidence the Trustee would have presented had he
been given notice
and hearing prior to issuance of the amended order. See, e.g.,
In re C.F.M., 360
S.W.3d at 660-61 (Tex. App.Dallas 2012, no pet.) (concluding
that any due-
process error in not holding additional hearing was harmless
because appellant gave
9 Rule 29.5 also precludes a trial court from issuing an order
that is inconsistent with a temporary order by the court of
appeals, but that limitation is not implicated here. See TEX. R.
APP. P. 29.5(a).
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44
no indication of additional evidence he would have offered or
how it would have
impacted receivership order); C/S Solutions, Inc. v. Energy
Maint. Servs. Group
LLC, 274 S.W.3d 299, 307-08 (Tex. App.Houston [1st Dist.] 2008,
no pet.)
(rejecting challenge to summary-judgment order on basis that
notice of its
reconsideration was inadequate because any error was harmless
when no new
motions, pleadings, or evidence had been presented and there was
no assertion of
harm). Without a showing of harm, there can be no reversible
error.
PRAYER
Appellee respectfully requests that this Court affirm the trial
courts order.
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45
Respectfully submitted, Bennett L. Stahl State Bar No. 19006500
[email protected] CURL STAHL GEIS, P.C. One Riverwalk Place 700
North St. Marys Street Suite 1800 San Antonio, Texas 78205
Telephone: (210) 226-2182 Telecopier: (210) 226-1691 Emily Harrison
Liljenwall State Bar No. 12352250 [email protected]
SCHOENBAUM, CURPHY & SCANLAN, P.C. 112 E. Pecan, Suite 3000 San
Antonio, Texas 78205 Telephone: (210) 224-4491 Telecopier: (210)
224-7983
/s/ Harriet ONeill Harriet ONeill State Bar No. 00000027
[email protected] LAW OFFICE OF HARRIET ONEILL, P.C. 919
Congress Avenue, Suite 1400 Austin, Texas 78701 Telephone: (512)
944-2222 Telecopier: (512) 476-6441 Douglas W. Alexander State Bar
No. 00992350 [email protected] Amy Warr State Bar No. 00795708
[email protected] ALEXANDER DUBOSE JEFFERSON & TOWNSEND LLP 515
Congress Avenue, Suite 2350 Austin, Texas 78701-3562 Telephone:
(512) 482-9300 Facsimile: (512) 482-9303
Attorneys for Appellee Renee Benson
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46
CERTIFICATE OF SERVICE
On July 10, 2015, I electronically filed this Brief of Appellee
with the Clerk
of the Court using the eFile.TXCourts.gov electronic filing
system which will send
notification of such filing to the following:
David J. Beck State Bar No. 00000070 [email protected]
Russell S. Post State Bar No. 00797258 [email protected] Troy
Ford State Bar No. 24032181 [email protected] BECK REDDEN LLP
1221 McKinney Street, Suite 4500 Houston, Texas 77010-2010
Telephone: (713) 951-3700 Telecopier: (713) 951-3720
Phillip A Wittmann (admitted pro hoc vice)
[email protected] James C. Gulotta, Jr.
[email protected] STONE PIGMAN WALTHER WITTMANN L.L.C. 546
Carondelet Street New Orleans, Louisiana 70130-3558 Telephone:
(504) 581-3200 Telecopier: (504) 581-3361
C. David Kinder State Bar No. 11432550 [email protected] Mark
J. Barrera State Bar No. 24050258 [email protected] Ellen B.
Mitchell State Bar No. 14208875 [email protected] COX SMITH
MATTHEWS 112 E. Pecan Street, Suite 1800 San Antonio, Texas 78205
Telephone: (210) 554-5500 Telecopier: (210) 226-8395
Steven R. Brook State Bar No. 03042300 [email protected]
Joyce W. Moore State Bar No. 14357400 [email protected]
LANGLEY & BANACK, INC. 745 East Mulberry Avenue, Suite 900 San
Antonio, Texas 78212 Telephone: (210) 736-6600 Telecopier: (210)
735-6889
/s/ Harriet ONeill Harriet ONeill
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47
CERTIFICATE OF COMPLIANCE
Based on a word count run in Microsoft Word 2013, this brief
contains 10,737
words, excluding the portions of the brief exempt from the word
count under Texas
Rule of Appellate Procedure 9.4(i)(1).
/s/ Harriet ONeill Harriet ONeill
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INDEX TO APPENDIX 1. Addendum to Order 2. Letter
-
APPENDIX 1
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13
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14
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15
-
16
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17
-
APPENDIX 2
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BENNETT L. STAHL BOARD CERTIF1to-CIVIL 'TRIAL La.w TtXAS BOARD
OF le:GAL SPECIALIZATION [email protected]
VIAFAX210-335-2029 &
LAW OFFICES
CURL STAHL GEIS A PROFESSIONAL CORPORATION
.700 NORTH ST, MARY'S STREET, SUITE I 800
SAN ANTONIO, TEXAS 78205 TELEF>HONE (210) 2262162 TELECOPIER
(210) 226-1691
wwwzsglaw.com
February 3, 2015
EMAIL: [email protected]
Honorable Tom Rickhoff Bexar County Probate Court #2 Bexar
County Courthouse l 00 Dolorosa, Suite 117 San Antonio, TX
78205-3002
Re: Estate of Shirley L. Benson, Cause No. 155,572, In Probate
Court No. 2 of Bexar County, Texas.
Dear Judge Rickhoff:
As instructed, I foiwarded the Court's letter of January 29 to
the attorneys for Respondent Thomas Benson as Trustee, Phillip
Wittmann, Esq. and David Beck, Esq. Later that day counsel and I
conferred by telephone regarding the questions presented in the
Court's letter. There appears to be agreement on some of the issues
raised.
Time Needed for Hearing
After conferring, we believe one full day may be sufficient for
the entire hearing set for Wednesday.
Jurisdiction and Venue
My understanding is there will be no challenge to jurisdiction
or venue.
Relevant Instruments
There is general agreement that the relevant instruments are the
ones mentioned in the Petition of my client, Renee Benson. Those
instruments are the Last Will of Shirley Benson and its two
Codicils that were admitted to probate, along with the Judgment
from 2000, modifying the testamentary trust.
-
Honorable Tom Rickhoff February 3, 2015 Page2
Necessary Parties
The necessary parties appear to be properly named, except that
Mr. Wittmann informed me of his understanding that years ago Mr.
Benson resigned as trustee of the 1991 trusts for Renee's children,
and that Renee is the successor trnstee of those trusts, which are
beneficiaries of the Testamentary Trust. We may amend the Petition
accordingly, to reflect Renee as trnstee of those beneficiary
trusts. My understanding is those trusts hold no assets at
present.
Limited Purpose Co-Trustee
I do not know whether the limited purpose Co-Trustee will enter
an appearance. I have sent a proposed Waiver of Citation to an
attorne