Wednesday, March 31, 2021

Texas Custody Modification Upheld Despite Conflicting Evidence

Originally published by Kelly McClure.

iStock-1139699594When a court considers Texas child custody and visitation, the child’s best interest is the primary concern.  The court considers certain factors, including what the child wants, the child’s current and future needs, any danger to the child, the parents’ respective abilities, programs available, the parents’ plans for the child, stability, any acts or omissions indicating the relationship between the parent and child is not proper, and any excuse for those acts or omissions.

A father recently appealed a denial of his petition for modification and grant of the mother’s counterpetition.  At the time of the divorce, the trial court ordered the parties not to move from a specific area without a modification order or written agreement filed with the court.  Neither parent was given the exclusive right to designate the child’s primary residence.  Nonetheless, both parents moved outside of the geographical boundary after the divorce.

 

Father Seeks Modification of Prior Order

The father petitioned for modification, alleging there was a material and substantial change in circumstances.  He alleged a history or pattern of neglect by the mother. He sought to be awarded the exclusive right to determine the child’s primary residence.  The mother asked both parents be named joint managing conservators but that she be given the exclusive right to determine the child’s primary residence.  She also asked the court to expand the geographic restriction.

At trial, the mother testified she moved outside the geographic restriction soon after the divorce.  She said the father agreed to her move and to having the child every weekend.  The father testified they intended the agreement to last while the mother was in school. He said she moved twice more without addressing the agreement and he expressed concerns these moves were negatively affecting the child.  He also expressed concerns about her school attendance and behavior toward her teachers.

On the other hand, the father moved five times since the divorce, living outside of the geographic restriction once.  He testified his wife helped parent the child.  He said he was concerned the mother’s current marriage to her wife confused the child.  He said the mother did not include him in health and education decisions, either.  He also said he did not think she would follow court orders as the child’s primary conservator.

The father’s wife testified the child’s behavior had changed.  She said the child did not want to eat and was clingy.  The father’s wife was concerned about the mother’s relationship stability, because she had dated numerous men since the divorce.

The child’s paternal grandfather testified the father and his wife had a good relationship with the child.  He said it would be in the child’s best interest for her father to have the right to determine her primary residence.  He said the child had changed and was scared to be alone.

The child’s former principal testified the child was often late, but her attendance was not abnormal.  She had not noticed any changes in the child’s behavior and did not have any concerns about her.

The child’s kindergarten teacher testified about issues with the child being disrespectful and she was more disruptive when with her mother.

The mother’s sister testified the mother and child lived with her about a year.  She had no concerns about the child living with the mother and the mother’s wife.  She said it would be in the child’s best interest to stay with her mother through the week.

The mother testified she and the child lived with her boyfriend after the divorce.  She then moved outside the geographic restriction to go to nursing school, to which the father had agreed.  She said she was engaged for two years, but her fiancĂ© never stayed overnight when the child was there.  She moved again when they eventually broke up.  Her current wife eventually moved in with her after they had begun dating.  The mother testified her wife and the child had a good relationship.  She admitted the child was confused about the mother’s relationship at first, but then she talked to her about same-sex marriages.

The mother testified the father had not objected to her moves.  She admitted that she did not get the father’s approval for the child’s healthcare decisions, but denied keeping him from talking to the child on the phone.

She said changing the child’s home and schedule would be detrimental to her.  She testified the child was doing well and liked her new school.

The trial court denied the father’s petition and granted the mother’s.  The court appointed both parents joint managing conservators and granted the mother the exclusive right to designate the child’s primary residence in Harris County.  The trial court found a material and substantial change in the circumstances of both parents and the child.  The court found the mother could provide a more stable home.  The trial court found the mother having the right to determine the child’s primary residence was in the child’s best interest, as were the other rights and duties awarded to each parent.

Father Appeals Trial Court’s Denial of His Requested Modification

The father appealed.  He argued the trial court abused its discretion when it gave the mother the exclusive right to designate the child’s primary residence without legally and factually sufficient evidence.

An appeals court reviews a modification of conservatorship for an abuse of discretion. The appeals court must consider whether the trial court had sufficient evidence to exercise its discretion and whether the court erred in applying that discretion.  A number of witnesses testified for both parties, providing somewhat conflicting information. The appeals court found there was some evidence supporting the court’s decision to name the parent’s joint managing conservators and give the mother the exclusive right to designate the child’s residence and that the trial court’s decision was reasonable in light of the evidence. The appeals court also found no error in the trial court’s exclusion of one of the father’s witnesses and affirmed the trial court’s judgment.

Call the Experienced Child-Custody Attorneys at McClure Law Group Today

Ultimately, the trial court has significant discretion in determining the best interest of the child and the credibility of the evidence. If you are dealing with a custody issue, a skilled Texas child custody attorney can help you.  Call McClure Law Group at 214.692.8200 to schedule a consultation.

 

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2021 Elections: Watch ‘A Minute with the Candidates’ Now

Originally published by Justine Carreon.

Voting in the 2021 elections for State Bar of Texas president-elect and open district director positions starts tomorrow, April 1, and ends at 5 p.m. CDT on April 30. To help you get to know the president-elect candidates better, we’ve produced a four-part video series, “A Minute with the Candidates,” featuring short interviews with Sara Dysart and Laura Gibson.

The series concludes today with the video linked below. Watch to learn how the candidates decided to become a lawyer. All four videos in the series can be viewed at  texasbar.com/elections  and on the  State Bar’s YouTube channel.

For information on voting in the 2021 elections, go to texasbar.com/elections—and watch your mailboxes and email inboxes for your paper and electronic ballots. All lawyers who are active and in good standing with the State Bar of Texas are eligible to vote in State Bar elections.

Get to know the president-elect candidates by clicking on the video link below.

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Tuesday, March 30, 2021

Courts Rule On Jurisdictional Issues Involving Probate Orders

Originally published by David Fowler Johnson.

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.

Id. The court held that because this was an order denying a motion to remove an executor and because the trial court did not rule on requests for attorney’s fees, the order was not final for appealable. Courts commonly hold that an unadjudicated claim for attorney’s fees means that a judgment or order is not final, and this case uses that concept in the context of a probate order.

In In the Estate of Harris, a party appealed an order of a trial court order authorizing payment of an attorney ad litem’s fees and terminating the ad litem’s representation. No. 02-19-00333-CV, 2021 Tex. App. LEXIS 1632 (Tex. App.—Fort Worth March 4, 2021, no pet. history). The court of appeals first held that the probate court’s order was appealable: “There is not an express statute declaring a probate order authorizing payment of an attorney ad litem’s fees or terminating the ad litem’s representation to be final and appealable. But such an order concludes a discrete phase of the probate proceeding and has been held to be appealable under De Ayala.” Id. The court then held that the probate court had authority to reappoint the ad litem even though an earlier order was appealable. The court held:

Harris’s reiteration of his plenary-power challenge demonstrates the lingering confusion surrounding the finality of appealable orders in the probate context. Specifically, Harris continues to rely on the understandable assumption that all appealable probate orders necessarily trigger the thirty-day expiration of plenary power under Rule 329b. This is not so. While probate proceedings are an exception to the one-final-judgment rule and may give rise to multiple appealable orders, such orders do not necessarily deprive the probate court of plenary power. Although an interlocutory order issued in a probate proceeding may be sufficiently final to permit appellate review under De Ayala, the interlocutory order remains just that—interlocutory. The probate court retains authority over the probate proceeding—including the authority to modify its prior orders—despite the appealability of certain interlocutory orders that conclude discrete phases of the proceeding. Harris’s challenge is thus misguided. Despite the appealability of the probate court’s March 2018 order awarding Cooper attorney’s fees and terminating her representation as attorney ad litem, the probate court did not lose plenary power to reinstate or to reappoint Cooper in her former role. We overrule Harris’s first issue.

Id. This case presents an interesting issue in Texas. The case holds that even though a probate order is sufficiently final for appeal, that a trial court has continuing jurisdiction over the order until the entire probate proceeding is terminated. In Texas, probate proceedings are rarely terminated as parties normally just leave them open in case some future event occurs. So, can a party file a motion to modify an order that was entered twenty, thirty, or fifty years ago where the probate is still pending? This opinion would support a “yes” answer to that question.

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Social Media Platforms Can Now Be Used for Substitute Service in Texas

Originally published by Peggy Keene.

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Texas Rules Now Allow Substitute Service Via Social Media

The global pandemic of coronavirus has changed the face of law practice today. With the need for social distancing, parties, attorneys and judges alike have all become accustomed to holding hearings, depositions, and other legal proceedings via video conferencing. And as technology continues to shape the practice of law, the Texas Rules of Civil Procedure now allows for substitute service on a defendant via social media.

Perfecting Substitute Service of Process Via Social Media Platforms

Via legislative mandate, SB 891 (2010) and TCPRC § 17.033c—if substituted service of citation is authorized under the Texas Rules of Civil Procedure, the court, in accordance with the rules adopted by the supreme court under subsection (b), may prescribe electronic communication sent to the defendant through a social media presence as a method of service.

In order to ensure that the service is effective, attorneys that intend to serve defendants via social media must be ready to muster evidence to demonstrate and prove that the social media account is a legitimate means of serving the defendant. Generally, this requires that the attorney show, among other things, that: the account is authentic; the account actually belongs to the defendant in question; the “age” of the profile is appropriate; there is a sufficient amount of posts or history of posting that would support a finding of authenticity; there have been instances of direct communication with the owner of the account; and there is evidence to demonstrate that the defendant indeed received the requisite documents via the social media account.

Ownership of Account Required for Substitute Service Via Social Media

Moreover, it is important to note that while some defendants may be responsible for managing the social media accounts at their place of work, this does not mean that the account they manage constitutes a viable account to serve them on.  Thus, attorneys should distinguish between accounts that defendants are active on but do not “own” in contrast to personal accounts that defendants do “own” and could thus be used for service.

In the end, the biggest takeaway for attorneys is that they must be ready and willing to offer the necessary evidence to demonstrate that the social media account they intend to serve is the proper account for the defendant and said account is active. Attorneys should also understand that service through social media is for substitute service only.

Key Takeaways for Substitute Service Via Social Media in Texas

The Texas Rules of Civil Procedure have expanded alternate means for substitute service to include service via social media. In order to successfully serve a defendant via social media, counsel must be prepared to submit evidence that shows:

  • that the social media account in question actually belongs to the defendant;

  • that the social media account is active; and

  • that the defendant was actually served via the account.

For more information on litigation services, see our Intellectual Property Litigation and Industry Focused Legal Solutions pages.


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2021 Elections: A Minute with the President-elect Candidates, Part 3

Originally published by Justine Carreon.

Learn more about the State Bar of Texas 2021 president-elect candidates—Sara Dysart, of San Antonio, and Laura Gibson, of Houston—through our four-part video series, “A Minute with the Candidates.”

In today’s third video of the series, the candidates answer the question: “What do you do to recharge your batteries so that you can serve your clients?”

If you missed the first two videos of the series, check them out at texasbar.com/elections or our YouTube channel. The fourth video will be released on Wednesday, March 31.

Subscribe to the State Bar’s email newsletter to get a link each day the videos are posted, along with other legal news of interest to Texas lawyers.

Be sure to check back with us tomorrow for the last video!

Get to know the president-elect candidates by clicking on the video link below.

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Pay Promptly Please

Originally published by David Coale.

“[P]ayment of an appraisal award does not absolve the insurer of statutory liability when an insurer accepts a claim but pays only part of the amount it owes within the statutory deadline. Because the insurer in this case did not pay the amount that ‘must be paid’ on the claim before the statutory deadline, it was not entitled to summary judgment.” Hinojos v. State Farm Lloyds, No. 19-0280 (March 19, 2021) (7-2 decision).

The post Pay Promptly Please appeared first on 600 Hemphill.

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President-elect candidate forum available for on-demand viewing

Originally published by Lowell Brown.

The candidates for 2021-2022 State Bar of Texas president-elect participated in a virtual forum on March 25 sponsored by the state’s metro bar associations. Video of the forum, which was approved for 1.5 hours of MCLE credit, is available to watch on demand here.

Candidates Sara Dysart, of San Antonio, and Laura Gibson, of Houston, discussed their qualifications for office, plans for the future, and the challenges facing the State Bar and the profession during a discussion moderated by Jo Ann Merica, of Austin.

The Austin Bar Association, Dallas Bar Association, Houston Bar Association, San Antonio Bar Association, and Tarrant County Bar Association sponsored the event.

Lawyers who are active and in good standing with the State Bar of Texas will vote in president-elect and district director races from April 1 to 30. For more information about the elections, go to texasbar.com/elections.

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Flakes Returns

Originally published by David Coale.

Many books and movies involve tales of scary creatures who return, ranging from Grendel’s family in the ancient epic of Beowulf to “Where’s My Mummy?”, an underappreciated part of the Scooby Doo multiverse. The topic of briefing waiver returns in the majority opinion ifrom Herczeg v. City of Dallas, which found waiver in a sovereign-immunity case because the opening brief did not address untimeliness or exhaustion of remedies. It distinguished St. John Missionary Baptist v. Flakes, 595 S.W.3d 211 (Tex. 2020), as involving “two grounds [that] were not actually independent but were inextricably intertwined,” while here, “untimeliness and failure to exhaust administrative remedies are independent of the City’s other grounds, which focused on the merits of Herczeg’s claims.” A dissent questioned whether the older authority cited by the majority continued to be viable after Flakes. Justice Garcia wrote for the majority, joined by Justice Smith; Justice Schenck dissented. No. 05-19-01023-CV (March 29, 2021) (mem. op.).

The post Flakes Returns appeared first on 600 Commerce.

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Friday, March 26, 2021

Top 10 from Texas Bar Today: Garamond Font, Geographic Areas, and Sneeze Guards

Originally published by Joanna Herzik.

To highlight some of the posts that stand out from the crowd, the editors of Texas Bar Today have created a list from the week’s blog posts of the top ten based on subject matter, writing style, headline, and imagery. We hope you enjoy this installment.

10. Writing Wednesday — Garamond Font.David Coale @600camp of Lynn Pinker Hurst & Schwegmann in Dallas

9.  Texas Grandmother Has Standing to File Custody SuitFrancesca Blackard of McClure Law Group @McClureLaw in Dallas

8.  Construction Project Litigation During COVID-19MehaffyWeber, P.C. @MehaffyWeber in Houston

7.  Can Your Employer Prohibit You from Discussing Your Salary?Jennifer Spencer of Jackson Spencer Law in Dallas

6.  What Are Apple Privacy Labels and How Transparent Are They, Really? – Peggy Keene of Klemchuk LLP @K_LLP in Dallas

5.  In 2021 What is the New Normal for Client Development Success?Cordell Parvin @cordellparvin in Prosper

4.  Covid-19, sneeze guards and the ADARichard Hunt of Hunt Huey PLLC in Dallas

3.  Case Addresses Mineral Reservation Language DisputeTiffany Dowell Lashmet @TiffDowell, Assistant Professor and Extension Specialist in Agricultural Law with Texas A&M Agrilife Extension in College Station

2.  BlueStone v. Randle — A Win for Royalty Owners on Post-Production CostsJohn McFarland @TXOilGasLawPro of Graves Dougherty Hearon & Moody in Austin

1.  What is a Reasonable Geographic Area for Physician Non-Compete Agreements?Leiza Dolghih @TexasNonCompete of Lewis Brisbois Bisgaard & Smith LLP in Dallas

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Thursday, March 25, 2021

It Could Soon be Easier to Qualify for the Patent Bar

Originally published by Ty Edwards.

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USPTO Proposes Changes for Requirements to Qualify for the Patent Bar

On Tuesday, March 23, 2021, the United States Patent and Trademark Office (USPTO) published a Request for Comments to ask for public input of proposed changes to the General Requirements Bulletin for Admission to the Examination for Registration to Practice in Patent Cases Before the United States Patent and Trademark Office.

Current Eligibility Requirements

Three main categories are used to show eligibility:

  • Category A “Bachelor’s Degree in a Recognized Technical Subject”

  • Category B “Bachelor’s Degree in Another Subject”

  • Category C “Practical Engineering or Scientific Experience”

If an applicant’s bachelor’s degree falls into Category A, they do not have to do anything beyond show proof of their degree. If the Applicant’s bachelor’s falls into Category B they must show a certain number of credit hours in physics, chemistry, biology, or some engineering courses to the satisfaction of the Office. If an Applicant has a graduate degree in a Category A subject, but their bachelor’s is not, then they must prove they have the requisite scientific knowledge to the satisfaction of the Office.

Proposed Changes for Eligibility to Qualify for the Patent Bar

The proposed changes address the different categories for eligibility to sit for the Patent Bar. The changes would move degrees in aerospace engineering, bioengineering, biological science, biophysics, electronics engineering, genetic engineering, genetics, marine engineering, materials, engineering, materials science, neuroscience, ocean engineering, and textile engineering from Category B to Category A. The Office wants to make this change as Applicants with these degrees are able to show proficiency often enough to warrant the move. Another proposed change is to accept Category A graduate degrees without the extra requirement to prove knowledge. Finally, there is a proposal to accept a combination of core science courses under one of the options in Category B if they include a lab component. These changes are intended to help the efficiency of the application process.

The USPTO is accepting comments from the public on these proposed changes until May 24, 2021. Comments may be made on the Federal Register website.

For more information on patents, see our Patent Services Overview and Industry Focused Legal Solutions pages.

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2021 Elections: A Minute with the President-elect Candidates

Originally published by Lowell Brown.

Voting in the 2021 elections for State Bar of Texas president-elect and open district director positions will take place April 1-30.

To help you get to know the president-elect candidates better, today we’re launching a four-part video series, “A Minute with the Candidates,” featuring short interviews with Sara Dysart and Laura Gibson.

In today’s installment, the candidates discuss the silver linings they’ve experienced during the pandemic. The other installments will be released on Monday, Tuesday, and Wednesday of next week at and on the .

Subscribe to the State Bar’s email newsletter to get a link each day the videos are posted, along with other legal news of interest to Texas lawyers.

Get to know the president-elect candidates by clicking on the video link below.

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Construction Project Litigation During COVID-19

Originally published by MehaffyWeber.

As the COVID-19 pandemic approaches the one-year mark in Texas, the effects of the pandemic on the construction industry are still being felt. Construction companies continue to face challenges in keeping job sites active, productive, and safe for contractors and employees. Texas may be recovering slowly as vaccine distribution has been delayed and new, more contagious virus strains are appearing; however, construction projects are moving forward, and construction companies must take preventative action to keep their projects and assets safe from coronavirus-related litigation. COVD-19 related lawsuits have been filed across the country and range in subject matter, from personal injury to breach of contract to insurance coverage litigation. Learn more about legal issues affecting current Texas construction projects.

Potential Personal Injury Liability Issues Related to COVID-19

Mitigating potential liability is the first step in preventing lawsuits related to contractors or employees suing for being exposed to COVID-19 and subsequently falling ill while working. A worker who files a personal injury lawsuit claiming they contracted the virus at work must prove they were exposed while performing their normal job duties at the worksite. While OSHA does consider COVID-19 to be a recordable illness, workers can be exposed outside of work, within the community. The virus also has an incubation period of 2 to 14 days, making it incredibly difficult to pinpoint exactly when and where an individual has been exposed. OSHA did issue a list of construction industry specific guidance designed to help keep employers safe, and has issued over $4 million in fines to businesses across all industries for failing to implement proper COVID-19 safety precautions. Businesses should also keep in mind that state governor orders do not pre-empt any federal regulations, including those from OSHA.

Multiple lawsuits are already pending, including several wrongful death lawsuits claiming businesses either failed to implement CDC guidelines, failed to properly respond when workers showed signs of COVID-19, or intentionally instructed workers not to wear masks – all allegedly leading to an employee’s illness and subsequent death. There has also been an increase in cases involving claims of public nuisance based on workplace safety, with allegations of businesses operating with unsafe conditions, such as forcing COVID-19 positive workers to continue working, failing to provide sufficient PPE, and failing to enforce safety guidelines. One recently filed case in federal court in California involves a “take-home” tort, with the spouse of the worker alleging he contracted COVID-19 at his workplace and brought the toxin home – causing her to subsequently contract COVID-19. The judge ultimately dismissed the case for lack of standing.

Many states have either passed or pending legislation to give businesses immunity from legal action brought by employees who contract COVID-19. On March 3, 2021, Texas House Bill No. 2782 was introduced, which states that a business entity or person who owns a business may not be held liable for injury or death caused by exposure to COVID-19 that occurs due to the entity’s operations. This protection would not apply, however, if there was gross negligence or willful misconduct involved. If passed, this Act would take effect on September 1, 2021.

Coronavirus-Related Contract Claims

COVID-19 has put many construction projects in a bad position due to labor shortages, supply chain issues, price increases, and falling construction costs. Some projects had to be delayed significantly due to city and state shut-downs and mandatory quarantines. State and local governments have also started to pull funding for some construction projects to redirect that financial support to pandemic needs. Some construction projects have been scrapped altogether, especially in the entertainment and hospitality industries, as companies realize new buildings or facilities will not be able to be used until the pandemic ends. All of these factors need to be considered when reviewing construction contracts that were executed before the pandemic began.

To help prevent lawsuits related to construction contract performance, all project contracts should be thoroughly reviewed. Determining the company’s rights and responsibilities under all active contracts as well as what risks are involved with delaying or stopping work on the project will be key to understanding where your business stands in a contract dispute. Is the company in danger of non-performance? Do the contracts have a force majeure clause that has been activated by COVID-19? What are the termination rights of the construction company as well as the business funding the construction project? Meeting with knowledgeable commercial litigation attorneys can help you find clarity with regard to what may happen if a lawsuit is brought against a construction company for COVID-19 related reasons.

If the project contract contains a force majeure provision, the company may be protected from breach of contract if it is unable to fulfill its contractual obligations during the pandemic. Many force majeure clauses include epidemics or acts of God that are beyond the control of the parties to the contract. The precise contractual language is crucial here, as courts may only excuse a party’s nonperformance if a specifically listed event has occurred. COVID-19 may be covered by a force majeure provision if it includes the terms “disease,” “pandemic,” or “epidemic.” If force majeure is unable to be activated or a provision has not been included in a contract, there are other defenses available if a lawsuit arises. Impossibility of performance and frustration of purpose may be applicable depending on the circumstances surrounding the construction project. The pandemic brought a variety of unforeseen circumstances to light which may provide sufficient evidence to support an impossibility of performance defense. If the pandemic rendered contractual obligations substantially or completely different from those originally set forth in the contract, for reasons beyond a party’s control, the frustration of purpose defense can also be considered.

Construction companies should communicate clearly with their customers to relay any current or future changes to the project, whether they are COVID-19 related or not. Litigation can often be avoided when the parties involved take the time to discuss challenges as they arise. There may be room for negotiation among all parties to a contract that will satisfy the necessary changes without the need for a breach of contract lawsuit. Maintaining strong business relationships with customers and vendors can be vital during these unprecedented times.

The post Construction Project Litigation During COVID-19 appeared first on MehaffyWeber.

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Virtual new lawyers induction ceremony set for May 10

Originally published by Lowell Brown.

Editor’s Note: The Texas Board of Law Examiners released the following announcement.

The State Bar of Texas is planning to hold a virtual swearing-in ceremony on May 10, 2021.

Eligible February 2021 and March 2021 examinees will receive an invitation through ATLAS to register for the ceremony.

Guests are invited to watch the ceremony here: https://www.youtube.com/SupremeCourtofTexas.

 

 

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Can Your Employer Prohibit You from Discussing Your Salary?

Originally published by Jennifer Spencer.

There is a common misconception among employees that you cannot discuss your pay with others. In fact, employees’ right to discuss their salary is protected by law. While employers may restrict workers from discussing their salary in front of customers or during work, they cannot prohibit employees from talking about pay on their own time.

In this article, we will answer the most frequently asked questions about salary discussions. We’ll also review the laws that protect salary discussions, as well as their exceptions and limitations. Let’s start by answering the most important question, “Can employers prohibit workers from discussing pay?

Employers Cannot Prohibit Employees from Discussing Pay

In 2014, President Obama signed an Executive Order stating that Federal contractors cannot prohibit employees from discussing compensation. In the Order, Obama explains his reasoning:

“When employees are prohibited from inquiring about, disclosing, or discussing their compensation…compensation discrimination is much more difficult to discover…and more likely to persist.”

The Order goes on to stipulate that employers cannot discharge or otherwise discriminate against any employee or applicant because they have “inquired about, discussed, or disclosed compensation.”

Even prior to Obama’s 2014 Executive Order, Section 7 of the National Labor Relations Act (NLRA) prohibited employers from limiting employees’ activities related to “collective bargaining or other mutual aid or protection.” The National Labor Relations Board (NLRB), the body charged with enforcing the NLRA, has interpreted Section 7 to mean that employees have a right to discuss salary and wages. See, NLRB v. Brookshire Grocery Co., 919 F.2d 359 (5th Circuit, 1990). The NLRA applies to virtually all private-sector employers, only exempting federal, state, and local governments, employers subject to the Railway Labor Act, and those who only employ agricultural workers.

In a nutshell, the NLRA protects most employees’ right to discuss their salary, and President Obama’s executive order applied that same right to federal employees and contractors.

However, there are a few important exceptions to the rule that you should know about. If you have access to company wage and payroll information, you cannot share employee pay information with others unless your employer or an investigative agency has directed you to share that information. Basically, you do not have a right to reveal someone else’s salary with others.

What Can Employers Do When Employees Discuss Salary?

Employers cannot prohibit or discipline employees for talking about their salaries on their own time, but they may have an interest in reducing the distrust or jealousy that can arise from salary discussions. Transparency is great (not just in the workplace), but it can lead to some problems if a particular company does not have an easily understood compensation strategy. To prevent discrimination, inequity, and disputes over pay, it helps for employers to have a system of checks and balances when it comes to salary.

Rather than punish employees for discussing wages, employers should strive to have well-written compensation policies that inform all employees how they decide salary. They may also implement a complaint resolution procedure that gives employees a chance to be heard if they feel their salary is not in line with their co-workers. Ideally, employers will continually inform workers how they might increase their salary range, through additional training, certification, and merit increases. In other words, the best way for employers to discourage workers from discussing salary is to have a compensation system that everyone knows and understands.

Is Salary Confidential?

This question has a slightly more complicated answer. While employees are free to discuss their wages with one another, there must still be some degree of confidentiality.

For example, let’s say you have a co-worker, Bob. Without speaking to you, Bob goes to your company’s Human Resources Department and demands to know what you are being paid. The Human Resources office cannot discuss your salary with Bob because that is considered part of your confidential employee record. You have the right to share your salary with Bob, but others do not.

What are “Pay Secrecy” Policies and Are They Legal?

Because many workers are unaware that employers cannot restrict employees from discussing pay, some employers have tried to implement illegal policies. In fact, a 2011 survey found that half of employees say that their workplace discourages or prohibits “discussion of wage and salary information.” Pay secrecy policies, which may be written or implied, discourage or prohibit employees from talking about their pay. More often than not, pay secrecy policies are unwritten and employees just assume they are not allowed to discuss compensation. Either way, these types of policies clearly violate the NLRA.

But what about non-disclosure agreements? Non-disclosure agreements (NDAs) are confidentiality contracts that require two or more parties (such as an employee and employer) to keep specified information secret. Often, NDAs protect information like marketing and sales strategy, customer lists, and trade secrets. In general, non-disclosure agreements are lawful, but they cannot include any provisions that prohibit the discussion of pay. Salary discussions are protected and will trump any non-disclosure agreement (even if the other portions of the NDA are perfectly lawful).


We Can Help Protect Your Rights as a Worker

If your workplace has a pay secrecy policy, or you are disciplined or terminated for discussing salary with others, you may have a legal claim. If your employer is violating the NLRA or President Obama’s Executive Order regarding salary discussions, you have rights.

To find out if you have a legal claim and develop a strategy for moving forward, contact our office for a consultation. We offer free, no-obligation consultations so you can determine whether your case is worth pursuing before making any commitments.

The post Can Your Employer Prohibit You from Discussing Your Salary? appeared first on Jackson Spencer Law.

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Texas Grandmother Has Standing to File Custody Suit

Originally published by Francesca Blackard.

iStock-902725964-scaledIn Texas custody cases, it can be very difficult for a non-parent to obtain custody or visitation of a child over the objection of a parent.  In some circumstances, however, a non-parent (such as a grandparent) has the right to file suit seeking custody or visitation.  One such circumstance is when the person has recently had care, custody, and control of the child for at least six months.

In a recent case, a grandmother sought custody of her son’s child after her son’s death.  According to the appeals court’s opinion, the child was born in 2014.  From 2014 to 2020, the child and parents lived in various places, including the paternal grandmother’s home in Wilson County.  From 2017 to 2019, the child went to daycare in Wilson County.  From August 2019 to January 22, 2020, the parents and child lived with the paternal grandmother.

 

Father Passes Away – Grandmother Files for Custody

Sadly the father died in late January 2020, while they were living in an apartment.  The mother then moved in with her own parents and enrolled the child in school nearby.

The paternal grandmother filed for sole managing conservatorship of the child in February 2020, alleging that she had standing under Tex. Fam. Code § 102.004. She claimed the child lived with her “for the majority of his life. . .”  She provided an affidavit stating that the parents and child moved in with her in late 2014 and that the child lived with her “most of his life.” She sought immediate possession of the child, and the court granted it.  A constable removed the child from school and brought him to the grandmother.

The mother filed a plea to jurisdiction and argued that the grandmother did not have standing.  The court held a hearing and heard from 14 witnesses.  Three witnesses testified the grandmother had been the child’s primary caregiver and he had primarily lived in her home before the death of his father.

The parties and the court discussed whether the grandmother had standing under Tex. Fam. Code § 102.003(a)(9).  The mother argued the grandmother had not alleged standing under that section. The grandmother argued her affidavit was incorporated into her petition and the affidavit stated she had raised the child from 2017 until 2020.

The trial court ultimately found the grandmother had not met the burden of proof to show standing under either section and dismissed the petition. The grandmother appealed.

Grandmother Appeals Dismissal of Her Suit

The grandmother argued the trial court erred in finding she did not have standing under § 102.003(a)(9).  This section allows someone who “had actual care, control, and possession of the child for at least six months” ending within the 90 days before the petition was filed to file a suit affecting the parent-child relationship.

To show “actual care, control, and possession,” the non-parent (i.e., the grandmother) does not have to show that the parents completely gave up their own rights and responsibilities or that they had legal authority over the child.  The non-parent can prove care, control, and possession by showing they had a parent-like role and shared a home with the child, provided for the child’s daily needs, and provided the type of guidance and direction that a parent would.

Appellate Court Disagrees with Trial Court

The appeals court found the allegations in the grandmother’s petition and supporting affidavit, when taken as true, addressed each element required by § 102.003(a)(9).  The appeals court further found the allegations were sufficient to give the mother notice of the issues in controversy.  The appeals court found the pleadings were sufficient for the grandmother to assert § 102.003(a)(9) standing.

The trial court found the grandmother had not shown the child was in her care, custody, or control for six months, ending not more than 90 days before her petition was filed.  The appeals court noted, however, that the evidence presented at least raised a question of fact regarding the issue.  Witnesses testified the child had primarily lived in the grandmother’s home before his father died.  The appeals court found the evidence raised a question as to whether the grandmother and child shared a principal residence.  The mother argued there was evidence the grandmother’s “alleged possession of the child was always interrupted,” but the time does not have to be uninterrupted under the statute.

A daycare owner testified the child was enrolled from August 2017 until April 2019 and the grandmother was the primary contact.  The grandmother testified she had been the one who provided care for the child, including feeding him, bathing him, taking him to the doctor, enrolling him in daycare, and driving him to and from school. The grandmother’s daughter testified that she and the grandmother bathed the child, prepared his dinner, and helped with his homework. The grandmother’s daughter-in-law testified that the grandmother was the child’s primary caregiver, even when the mother was there.  The appeals court found the evidence raised a question of whether the grandmother exercised guidance and direction over the child and provided for his daily needs.

The mother argued the trial court found the grandmother’s testimony was not credible.  The appeals court noted that the case was at the plea to jurisdiction stage, and the grandmother only had to create a question of fact as to the jurisdictional issue.

The appeals court reversed the trial court’s dismissal of the grandmother’s suit and remanded.

Are You Seeking Custody as a Non-Parent? Call McClure Law Group Today

If you are a grandparent or other non-parent seeking custody or visitation, you should contact an experienced Texas custody attorney right away.  Call McClure Law Group at 214.692.8200.

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Lawyers: What is the Intersection of Your Passion, Talent, Need

Originally published by Cordell Parvin.

A lawyer I coached once asked  how I could possibly leave a secure, successful law practice in a large firm to go out on my own to coach, mentor, and help lawyers.

I told her that Nancy had asked me the very same question when I told her in 2004 that I planned to make the change.

It was a logical question for the lawyer and for Nancy given that my construction law practice was thriving, my clients were happy, my last trial resulted in a a great result. I loved practicing construction law and I loved my clients. I finally answered her question this way:

Coaching lawyers was the intersection of my talent, my passion and a need.


Simply put, I discovered when I worked with lawyers in my old law firm that helping those lawyers achieve success and fulfillment was the intersection of my passion and talent.

It also fulfilled a need. The lawyers I coached appreciated the help I gave them.

Finally, it was a new challenge. Long ago I discovered that I easily got bored doing things I had done many times before. While my law practice energized me, and I loved working with my favorite clients, I was even more energized by my efforts to help young lawyers and I felt I was making a greater contribution.

I can look back on that decision now. Had I continued practicing law I would have been far more financially secure than I am now. I didn’t make as much money as I had hoped I would make coaching lawyers. Even in my best years, I made only a fraction of what I made practicing law.

That said I doubt I would change anything. I worked with awesome young lawyers. Many of them are leading rainmakers or firm leaders now. Many share their success stories with me by email or handwritten notes. I discovered my passion when practicing law and later when coaching was helping others succeed…and having a feeling I had some part to play in their success.

What does my career change mean to you? I believe it is important to find your passion, talent and a client need. The lawyers I coach who are most successful have found that sweet spot. I saw a quote from the late Herman Cain. He said:

“Success is not the key to happiness. Happiness is the key to success. If you love what you are doing, you’ll be successful.” ~ Herman Cain

So naturally the question I ask is: Do you love what you do?

The post Lawyers: What is the Intersection of Your Passion, Talent, Need appeared first on Cordell Parvin Blog.

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Possible Limit on the Use of “Common Sense” to Invalidate a Patent Claim for Obviousness Based on a Single Reference

Originally published by Carstens & Cahoon LLP.

The law regarding obviousness, like a pendulum, has swung over time between favorable to unfavorable positions depending upon one’s perspective.  In 1952, the requirement that an invention be “nonobvious” was codified in Section 103 of the Patent Act.  In 1966, the Supreme Court issued its seminal decision in Graham v. John Deere 383 U.S. 1 […]

The post Possible Limit on the Use of “Common Sense” to Invalidate a Patent Claim for Obviousness Based on a Single Reference appeared first on Carstens & Cahoon.

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BlueStone v. Randle — A Win for Royalty Owners on Post-Production Costs

Originally published by John McFarland.

On March 12 the Texas Supreme Court issued its opinion in BlueStone Natural Resources II, LLC v. Walker Murray Randle, No. 19-0459, affirming most of the judgment of the court below in favor of the royalty owners. The Court’s opinion contains a summary and discussion of its prior cases on post-production costs and attempts to reconcile those prior opinions and clarify its views on the issue. I believe the opinion does provide clarification and substantially reduces the precedential value of its first case addressing post-production costs, Heritage v. Nationsbank. The Court also discusses when royalties must be paid on gas used as fuel. Because I consider this an important case on post-production costs, I will examine the opinion in some detail.

Randle’s leases are a printed form with an exhibit. The printed form provides that royalties on gas are “the market value at the well of one-eighth of the gas so sold or used …” Exhibit A provided that “the language on this Exhibit A supersedes any provisions to the contrary in the printed lease hereof.” One provision in Exhibit A deals with post-production costs:

Lessee agrees that all royalties accruing under this Lease (including those paid in kind) shall be without deduction, directly or indirectly, for the cost of producing, gathering, storing, separating, treating, dehydrating, compressing, processing, transporting, and otherwise making the oil, gas and other products hereunder ready for sale or use. Lessee agrees to compute and pay royalties on the gross value received, including any reimbursements for severance taxes and production related costs.

BlueStone argued that, under the precedent of the Court’s prior opinions in Burlington Resources v. Texas Crude Energy and Heritage v. Nationsbank, because the lease provides for royalties based on “market value at the well,” all other language in the lease is “surplusage” and has no effect, and post-production costs can be deducted. The Court disagreed. It held that the printed-form “market value at the well” royalty provision clearly conflicts with the no-deduction clause in Exhibit A and Exhibit A must therefore control, requiring royalty to be paid on the “gross value received.”

In the Court’s summary of its prior opinions on this issue, it reaffirmed a statement it made in Burlington that “an ‘amount realized’ clause, standing alone, creates a royalty interest that is free of post-production costs.” The Court distinguished its Burlington opinion: the royalty clause there required royalty to be paid on the “amount realized” but also included language requiring royalties to be delivered “into the pipelines,” which the Court equated (wrongly, I think) with “at the well.” Unlike the Randle leases, the royalty clause in Burlington did not clearly say that, notwithstanding the “into the pipeline” language, royalties would be based on “gross value received,” without deductions.

The Court appeared to acknowledge that its prior opinions concerning post-production costs may not have been perfectly clear:

When used in conjunction with “amount realized” or similar language, “at the well” is as much a valuation method as it is a valuation point. When proceeds are valued in “gross,” however, the valuation point is necessarily the point of sale because that is where the gross is realized or received. If our jurisprudence is less than precise in articulating some of these concepts, it is nonetheless clear that royalties computed on gross amounts received means royalties are paid based on point-of-sale proceeds without deduction of postproduction costs.

The Court then addressed BlueStone’s argument that “at the well” makes all other language surplusage.

BlueStone nonetheless contends that Burlington Resources treats “at the well” as a “trump” card that supersedes “amount realized” language without regard to other lease terms requiring royalty calculation on the “gross” and without regard to the parties’ own agreement about what language controls in the event of a conflict. … The contract terms Burlington Resources evaluated did not inherently conflict, but the terms used in BlueStone’s lease do. Nothing in Burlington Resources can reasonably be viewed as repudiating the notion that “gross” and “net” are opposite calculations or as favoring one over the other when both are present. Here, the parties expressly agreed to resolve the conflict in favor of a royalty free of postproduction costs, and courts must enforce unambiguous contracts as written. We accordingly hold that BlueStone wrongfully deducted postproduction costs in satisfying its royalty obligations to the Lessors.

The lease construed in Heritage v. Nationsbank provided that:

The royalties to be paid Lessor are …

on gas, .. the market value at the well of 1/5 of the gas so sold or used, … provided, however, that there shall be no deductions from the value of the Lessor’s royalty by reason of any required processing, cost of dehydration, compression, transportation or other matter to market such gas.

The Court held that Heritage could deduct post-production costs. It read the above clause to in effect say that “there shall be no deductions from the market value at the well by reason of any required processing, cost of dehydration, compression, transportation or other matter to market such gas.” Because the market value at the well is determined before any post-production costs are incurred, there can be no deductions from that value and therefore, according to the Court, the no-deductions language is “surplusage.” The Court ignored the words “provided however.” Arguably, those words mean that, regardless of how royalties would otherwise be paid, there can be no deduction of post-production costs–just as the language in the Randles’ leases that the Exhibit A provisions overcome the printed-lease terms and thereby prevail over the “at the well” language in the printed lease. Although the Court was ultimately divided 4 to 4 on the result in the case, lessees’ lawyers have sought to expand the scope of Heritage to mean that, whenever the term “at the well” is in a lease, any other language in the lease to the contrary can be ignored as “surplusage.” Perhaps the Court’s opinion in BlueStone will finally limit the precedential value of Heritage to the inartfully drawn language of that particular royalty clause.

The Court’s opinion also addressed whether BlueStone could use gas used for compressor fuel and plant fuel without paying royalty on those volumes. The lease provided:

Lessee shall have free from royalty or other payment the use of … gas … produced from said land in all operations which Lessee may conduct hereunder, including water injections and secondary recovery operations, and the royalty on … gas … shall be computed after deducting any so used.

Gas used as fuel for compression was consumed on the leased premises. BlueStone contracted with a processor to process the gas off the leased premises and the processor used a part of the gas delivered to it as fuel in its plant. The Court agreed with the Court of Appeals that the above language entitled BlueStone to use gas for compression on the lease, but that it must pay royalty on gas consumed as plant fuel–not consumed on the lease. The Court parsed the language “all operations which Lessee may conduct hereunder” as meaning under–and therefore on–the leased premises. The Court remanded the case to the trial court to determine what volumes of compressor fuel were produced from the leases.

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Writing Wednesday — Garamond Font.

Originally published by David Coale.

The DC Circuit’s recent style manual amendment that criticized the use of “Garamond” font has drawn national attention. As this matter has now become a pressing issue facing the federal courts, 600Camp weighs in with these thoughts, all of which are written in 14-point size:

Accordingly, if you really like Garamond and are writing a brief with a word limit rather than a page limit, you should consider bumping the size up to 15-point. And of course, in a jurisdiction with page limits rather than word limits, Garamond offers a way to add more substance to your submission–but be careful that this extra substance does not come at the price of less visibility.

The post Writing Wednesday — Garamond Font. appeared first on 600 Camp.

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Tuesday, March 23, 2021

What is an Affidavit of Heirship?

Originally published by Rania Combs.

When someone dies owning real estate, that property cannot be sold or transferred until the decedent’s name is removed from the title. Probate records become a link in the chain of title, demonstrating that the decedent’s property has passed to someone else.

But in cases where the decedent’s only asset is real estate, and there are no outstanding debts besides those secured by real estate, full probate may not be necessary. In some cases, an Affidavit of Heirship can be a cheaper and less time-consuming alternative to probate.

How is an Affidavit of Heirship Different Than Probate?

An Affidavit of Heirship is not a formal adjudication like probate is. Rather, it is an affidavit outlining the deceased person’s family history and the identity of heirs. Nothing is filed in the Probate Court. Rather, the affidavits are filed in the public records of any counties in which the decedent owned property.

Reasons Heirs Choose Affidavits of Heirship

The primary reason heirs opt for Affidavits of Heirship instead of full probate is that it is a cheaper alternative. Another reason is that more than four years have passed since the date of death, and probate may not be an available option.

Disadvantages of Affidavits of Heirship

While it is a cheaper alternative to a judicial determination of heirship, it does have some disadvantages.

  • A judicial determination conclusively determines the heirs. Affidavits of heirship just create a presumption that the facts contained in the affidavit are correct. A challenger can rebut the presumption by introducing controverting testimony.
  • The affidavit does not affect the rights of an omitted heir or a creditor of the decedent.
  • It may not be recognized as a valid transfer of title by entities such as banks and title companies; it’s always best to check with the bank and title company before choosing how to proceed.
  • Also, the affidavit does not become prima facie evidence of the facts contained in it until it has been on record for 5 years.

Who Can Sign an Affidavit of Heirship?

Heirs should not sign Affidavits of Heirship. Rather, the person who signs the affidavit (the affiant) should be a person who is familiar with the decedent’s family history and stands nothing to gain from the estate.

An affidavit of heirship is not appropriate for every situation. An attorney can help you determine whether an affidavit of heirship is appropriate for your unique circumstances.

The post What is an Affidavit of Heirship? appeared first on Rania Combs Law, PLLC.

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Default Judgment in a Texas Divorce Case

Originally published by Robert Epstein.

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When a spouse petitions for a Texas divorce, the other spouse must file an answer.  If the other spouse fails to do so, the court may render a default judgment.  Under certain circumstances, however, the other spouse may get the default judgment overturned.  In a recent case, a husband sought to overturn a default judgment entered against him.

According to the Texas Supreme Court’s opinion, the wife filed for divorce.  The trial court granted her motion for alternative service at the home of her husband’s mother.  The trial court ultimately entered a no-answer default judgment the following January.

 

The husband moved for a new trial.  He attached an affidavit stating he had resided at the same place in Mexico since he was deported in 2012.  He stated the wife visited him there on multiple occasions.  He stated he knew the wife wanted a divorce, and he did not object to a divorce or to the court ordering child support or visitation, but he did not know the wife sought the home in Fort Worth where his mother was living.  He claimed that he and his sister bought it before the marriage, and his mother provided the down payment and made all of the mortgage payments. His sister’s unsworn declaration stated they had purchased the home because of their mother’s credit.  The wife objected to the husband’s affidavit and his sister’s and mother’s unsworn declaration, arguing they were hearsay.  The trial court sustained the objection and denied the husband’s motion for a new trial.

Appellate Court Affirms Trial Court’s Denial on Different Grounds

The appeals court disagreed that the husband’s affidavit was hearsay; nonetheless, it affirmed the trial court’s denial of the husband’s motion for new trial, finding the husband failed to provide a translation for the certification of his affidavit, which rendered it inadmissible. The appeals court also found the unsworn declarations were conclusory and did not have factual support.  The appeals court found no error in the trial court’s exclusion of the affidavit and declarations and further found that the husband had not provided an excuse for failing to file an answer.

The husband petitioned for review by the Texas Supreme Court.

Overturning Default Judgments in Texas

Pursuant to Craddock v. Sunshine Bus Lines, Inc, a trial court must set aside a default judgment if: the defendant’s failure to answer was the result of a mistake or accident and not intentional or due to his conscious indifference, the defendant has a meritorious defense, and a new trial would not cause a delay or injure the other party.  The trial court must hear evidence if the moving party has alleged facts that would entitle him to a new trial and his motion presents a question of fact requiring evidence.  If the moving party’s affidavit is uncontroverted, the affidavit and motion merely have to provide factual information that negate intention or consciously indifferent conduct, if taken as true.  The trial court commits an abuse of discretion if it denies a motion for a new trial when the Craddock factors are met.

The moving party needs to show some reason for failing to file, but it does not have to necessarily be a good reason. A reasonable explanation will overcome the element of conscious indifference.  A mistake in the law leading to an intentional act can be reasonable.

The husband acknowledged knowing his wife wanted a divorce in his affidavit, but stated he did not receive a copy of the papers.  He also stated he was unaware the wife was seeking the home in Fort Worth.

Texas Supreme Court Finds Error at Trial-Court and Appellate Levels

The Texas Supreme Court noted that the uncontroverted factual allegations in a movant’s motion and affidavit are generally accepted as true, but the trial court sustained the wife’s hearsay objection.  The information in the husband’s affidavit was “clearly based on his personal knowledge. . .”  The trial court therefore erred when it found the affidavit was hearsay instead of accepting its uncontroverted factual allegations as true in deciding on the husband’s motion.

The appeals court also erred in affirming the trial court’s judgment based on the husband’s failure to provide a translation of the affidavit certificate.  The opposing party must object to such an error to allow an opportunity for correction.  The appeals court therefore erred because the wife had not objected and therefore not preserved the issue.

The Texas Supreme Court found the husband’s affidavit offered a reasonable explanation for his failure to file an answer.  He “mistakenly understood” his separate property would not be distributed in the divorce.  He stated he had not actually received a copy of the petition, but even if he had, he would not have known that the property he considered separate would be distributed.  The petition stated there would be a division of the community property.  The Texas Supreme Court found he “was reasonably unaware that his separate property would be affected,” and that his failure to answer resulted from that accident and mistake and not conscious indifference or an intentional act.

The Texas Supreme Court further noted that a failure to answer is not necessarily intentional or the result of conscious indifference under Craddock just because it was deliberate.  Craddock requires that the failure be without adequate justification, and the husband provided adequate justification.

The husband also showed a meritorious defense in his motion and affidavit.  He claimed the Fort Worth home was his separate property, and property acquired before marriage is generally separate. He stated he and his sister had bought the home before the marriage and their mother had paid for it. The wife did not contradict these assertions, so the lower courts should have taken them as true in deciding on the motion for a new trial.

The husband’s motion was filed timely.  The wife showed no evidence of harm.  The Texas Supreme Court further found that giving the husband a chance to prove ownership of the home would “not upset the underlying divorce, custody, support, or division of the community assets.”  There was therefore no evidence of undue delay or injury.

The Texas Supreme Court reversed and remanded the case to the trial court for additional proceedings.

Call McClure Law Group Today

Whether you are seeking a divorce or your spouse is, the advice and guidance of a skilled Texas divorce attorney can help you.  Schedule a consultation with McClure Law Group by calling 214.692.8200.

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Monday, March 22, 2021

What is a Reasonable Geographic Area for Physician Non-Compete Agreements?

Originally published by Leiza Dolghih.

I recently came across an article published by a consulting company advising medical practices that “as a rule of thumb” physician non-compete agreements should not extend beyond a five-mile radius.  Not only is this information wrong, but it also fails to acknowledge the differences between how various states treat physician non-compete agreements.

First of all, courts around the country have consistently found physician non-compete agreements with a radius of 15 to 75 miles to be reasonable where such restrictions were justified by a legitimate business interest.

For example, in Missouri, courts have held that: (1) a five-year restriction within a twenty-mile radius of the corporate limits of the city of St. Joseph, Missouri, was a reasonable restraint; (2) a covenant not to compete for five years within a radius of 60 miles of the City of Butler was reasonable; (3) a covenant not to compete, which stated that the doctor would not “perform any medical services or engage in the practice of neurology” within seventy-five miles of employer’s office, for a period of twenty-four months was reasonable.

In Idaho, courts have upheld 25 mile-radius restrictions for two- and even three-year terms. In Ohio, a court found that a 50-mile radius was reasonable.  Finally, in New York, a court determined that a restrictive covenant not to compete between a physician and a medical group, for a period of five years, within a 30 mile radius was reasonable and enforceable.

In rural areas, where medical practices are located hundreds of miles apart, even larger geographic restrictions may be enforceable. In contrast, in urban areas, 20-mile non-competes may not be reasonable. Moreover, as medical practices merge or acquire new locations, non-compete agreements that covered one or two locations and were reasonable may become unreasonable when they begin to cover 15 or 20 locations and gobble up entire metroplexes or states.

Second, different states have different rules about what is considered a reasonable geographic area for a non-compete agreement.  For example, Connecticut restricts physician covenants to a geographic scope of within a 15-mile radius from the primary site where a physician practiced. Tennessee will enforce physician non-compete agreements only if the geographic restriction does not exceed the greater of a 10-mile radius from the site of the healthcare provider or the county in which the healthcare provider’s practice is located. It will also allow physician non-competes without a geographic restriction if the physician is restricted only from practicing at any facility where the employer provided services during the physician’s time of employment.

Finally, there is no “rule of thumb” about what is reasonable, and medical practices need to consider what geographic restraints they need to put in place in order to protect a legitimate business interest, such as confidential information, trade secrets, goodwill, or patient base.

The following factors may affects how reasonable or unreasonable a particular geographic restraint is in a physician employment agreements is:

  1. In which state the practice is located
  2. Whether the practice is in a rural or urban area
  3. The type of medical practice
  4. The size of the practice
  5. The age of the practice
  6. The location of the patient base
  7. How far patients will travel
  8. Where the practice markets it services

Medical practices should consult with a qualified attorney when drafting non-compete agreements to make sure the geographic restraints are reasonable or risk having such restraints declared unenforceable in court or re-written by a judge in the middle of an enforcement lawsuit.

Leiza Dolghih is a partner at Lewis Brisbois Bisgaard & Smith LLP in Dallas, Texas and a Co-Chair of the firm’s Trade Secrets and Non-Compete Disputes national practice. Her practice includes commercial, intellectual property and employment litigation. You can contact her directly at Leiza.Dolghih@LewisBrisbois.com or (214) 722-7108.

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