Texas Court of Appeals

In Marshall v. Marshall, a beneficiary sued the original trustee and five co-trustees of two trusts regarding claims that they breached fiduciary duties. No. 14-17-00930-CV, 2021 Tex. App. LEXIS 1949 (Tex. App.—Houston [14th Dist.] March 16, 2021, no pet. history). After the original lawsuit was filed in Texas, the original trustee filed a petition

In Alexander v. Marshall, the original trustee was the beneficiary’s mother and the wife of the beneficiary’s father, who was the settlor. No. 14-18-00425-CV, 2021 Tex. App. LEXIS 1952 (Tex. App.—Houston [14th Dist.] March 16, 2021, no pet. history). In December 2016, the original trustee appointed Louisiana residents as co-trustees of the trusts and

In Neal v. Neal, the decedent died leaving three sons. No. 01-19-00427-CV, 2021 Tex. App. LEXIS 2051 (Tex. App.—Houston [1st Dist.] March 18, 2021, no pet. history). She had several wills in the last five years of her life, but her final will left all of her estate to one son. The other sons

In Adam v. Marcos, an attorney and his client agreed to a joint venture/partnership. No. 14-18-00450-CV, 2021 Tex. App. LEXIS 2060 (Tex. App.—Houston March 18, 2021, no pet. history). The attorney sued the client for breaching the agreement. The trial court ruled for the client on the attorney’s breach of the partnership agreement claim and a breach of fiduciary duty claim. The court of appeals affirmed. The court of appeals first held that the partnership agreement was presumptively invalid because the attorney owed fiduciary duties to the client when it was entered into:

Contracts between attorneys and their clients negotiated during the existence of the attorney-client relationship are closely scrutinized. Because the relationship is fiduciary in nature, there is a presumption of unfairness or invalidity attaching to such contracts. The burden is on the attorney to prove the fairness and reasonableness of the agreement. Moreover, as a fiduciary, Marcos had the burden to establish that Adam was informed of all material facts relating to the agreement. Additional important factors in determining the fairness of a transaction involving a fiduciary include whether the consideration was adequate and whether the beneficiary obtained independent advice.

Id. The court of appeals held that the jury’s finding of breach of duty by the attorney supported invalidating the partnership agreement: “Because the jury found that Marcos failed to fulfill his fiduciary duties to Adam in regard to the alleged partnership agreement, and the evidence supports that finding, the presumption that the contract was invalid applies. Thus, the trial court did not err in holding the agreement was invalid and unenforceable.” Id.
Continue Reading Business Divorce: Partnership Agreement Was Invalid Where It Was Entered Into Between A Fiduciary And Principal And Was Otherwise Unfair And The Principal Did Not Owe Fiduciary Duties As A Partner Where There Was No Enforceable Partnership

In Estate of Tillotson, an administrator of a decedent’s estate filed a turn over motion to have the decedent’s husband turn over the decedent’s community property interest in certain accounts. No. 05-20-00258-CV, 2021 Tex. App. LEXIS 2097 (Tex. App.—Dallas March 18, 2021, no pet. history). After the trial court granted the motion, the surviving spouse appealed. The court of appeals first held that the administrator had the power to file a motion to seek the partition of community property:

The Estates Code provides that at any time after the first anniversary of the date original letters testamentary or of administration are granted, an executor, administrator, heir, or devisee of a decedent’s estate, by written application filed in the court in which the estate is pending, may request the partition and distribution of the estate. See Est. § 360.001(a). The Estates Code further provides that if an intestate deceased spouse is survived by a child, the deceased spouse’s undivided one-half interest in the community estate passes to the deceased spouse’s children. See id. § 201.003… Accordingly, we conclude Hoyl in her capacity as administratrix could request partition of the community property and that the trial court did not err by granting Hoyl’s request to partition community property.

Id. The court discussed that Estates Code section 360.253(a) allows a surviving spouse to seek a partition, but holds that it does not make that right an exclusive one to the surviving spouse.
Continue Reading Administrator Of An Estate Has The Power To Seek The Partition Of Community Property

In TSA-Tex. Surgical Assocs., L.L.P. v. Vargas, one partner sued his other partners for various claims regarding the defendants attempt to squeeze the plaintiff out of the partnership. No. 14-19-00135-CV, 2021 Tex. App. LEXIS 1330 (Tex. App.—Houston [14th Dist.] February 25, 2021, no pet. history). The defendants filed a motion to dismiss under the Texas Citizens Participation Act (TCPA), and the trial court denied the motion. The defendants appealed.

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The TCPA was enacted “to encourage and safeguard the constitutional rights of persons to petition, speak freely, associate freely, and otherwise participate in government to the maximum extent permitted by law and, at the same time, protect the rights of a person to file meritorious lawsuits for demonstrable injury.” Id. (citing Tex. Civ. Prac. & Rem. Code § 27.002). It does so by authorizing a party to file a motion to dismiss a legal action that “is based on, relates to, or is in response to a party’s exercise of the right of free speech, right to petition, or right of association.” Id.

The court of appeals affirmed the denial of the motion to dismiss under the TCPA. The defendants argued that the plaintiff’s claims were based on, related to, or in response to the exercise of free speech because the claims purportedly involve communications regarding the provision of medical services. The court of appeals disagreed:
Continue Reading Business Divorce: Court Affirms Denial Of SLAPP Motion Regarding Partnership Divorce Suit

In In re Estate of Pandozy, a woman attempted to intervene in a probate proceeding claiming that she was the informal spouse of the decedent. No. 05-19-00755-CV, 2021 Tex. App. LEXIS 1265 (Tex. App.—Dallas February 22, 2021, no pet. history). The trial court heard evidence and ruled that she was not an informal spouse,

Parties often begin a business together without thinking through all of the legal details that define their rights. When they eventually divorce, they need to resort to the language in agreements that they entered into and also rely on statutory and common-law principles. In one recent case, the court held that the parties’ agreement’s language

One of the most difficult areas for probate litigation is determining when a party has an order that is appealable. There have been several recent cases that discuss this important area of probate litigation. In In re Estate of Mims, a party attempted to appeal an order denying his motion to remove an executor. No. 06-21-00005-CV, 2021 Tex. App. LEXIS 1650 (Tex. App.—Texarkana March 4, 2021, no pet. history). The court of appeals dismissed the appeal for lack of jurisdiction. Regarding general principals of finality, the court stated:

“It is well settled that appellate courts have jurisdiction over final judgments and interlocutory orders made appealable by statute.” “A judgment is final for purposes of appeal if it disposes of all pending parties and claims.” “Only one final judgment shall be rendered in any cause except where it is otherwise specially provided by law.” “Probate proceedings are an exception to the ‘one final judgment’ rule.” “A final order issued by a probate court is appealable to the court of appeals.” The Texas Supreme Court has adopted the following test to determine when a court order in a decedent’s estate is final and appealable: “If there is an express statute, such as the one for the complete heirship judgment, declaring the phase of the probate proceedings to be final and appealable, that statute controls. Otherwise, if there is a proceeding of which the order in question may logically be considered a part, but one or more pleadings also part of that proceeding raise issues or parties not disposed of, then the probate order is interlocutory.” There is no statute that declares an order refusing to remove an executor to be final and appealable.


Continue Reading Courts Rule On Jurisdictional Issues Involving Probate Orders

Parties often begin a business together without thinking through all of the legal details that define their rights. When they eventually divorce, they need to resort to the language in agreements that they entered into and also rely on statutory and common-law principles. In one recent case, the court held that the parties’ agreement’s language on the requirements for the formation of a partnership will trump other legal theories.
Continue Reading Business Divorce: Court Held That Parties Did Not Form A Partnership Where Certain Express Conditions Precedent Were Not Met