In Re: Emeritus Corp.

Texas Rule of Civil Procedure 621a incorporates the provisions of current Texas Rule of Appellate Procedure 24 even though it still refers to former Rules of Appellate Procedure 47 and 49 in its text.

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Click here for the full text of this decision FACTS:An original mandamus proceeding raised issues of whether and to what extent a judgment creditor could engage in post-judgment discovery after the judgment debtor had superseded the judgment by posting a cash deposit. Leo Ofczarzak and David Niedzielski, on behalf of the estate of Florine Ofczarzak, deceased (the real parties in interest), were awarded $1,524,445 in compensatory damages and $18 million in punitive damages in a wrongful death and survival suit against Emeritus Corp. Emeritus filed a motion to suspend enforcement of the judgment without bond. The real parties then served Emeritus with a request for deposition, post-judgment interrogatories and requests for production. The real parties also filed a motion to enjoin Emeritus from dissipating its assets to avoid satisfaction of the judgment. The trial court ordered Emeritus to respond to real parties’ written discovery and to produce CFO Raymond Brandstrom and CEO Dan Baty for deposition. The court also entered an injunction prohibiting Emeritus from dissipating its assets to avoid satisfaction of the judgment. Despite its previously filed motion to suspend enforcement of the judgment without bond, Emeritus posted a $1,725,000 cash deposit in lieu of bond and filed a Motion for Protective Order and to Quash Discovery in the trial court, asserting that the real parties’ discovery requests had become moot. The real parties opposed Emeritus’ motion, arguing that Texas Rule of Civil Procedure 621a authorized them to conduct post-judgment discovery to obtain information relevant to their motion for injunctive relief. The trial court agreed and denied Emeritus’ motion. Emeritus subsequently filed this original proceeding. HOLDING:Petition for writ of mandamus denied. Texas Rule of Civil Procedure 621a authorizes post-judgment discovery “for the purpose of obtaining information to aid in the enforcement of [a] judgment,” but only “so long as said judgment has not been suspended by a supersedeas bond or by order of a proper court and has not become dormant.” It also authorizes post-judgment discovery “for the purpose of obtaining information relevant to motions allowed by Texas Rules of Appellate Procedure 47 and 49 [now Rule 24].” At issue before the court is whether real parties are entitled to post-judgment discovery under the second prong of rule 621a. Emeritus contends real parties are not entitled to post-judgment discovery under the second prong of rule 621a because the rule does not authorize any post-judgment discovery once a judgment debtor posts security for the judgment. The court disagrees and reasons that if the supreme court had intended to preclude all post-judgment discovery upon the posting of security by the judgment debtor, the court would have included the language “so long as said judgment has not been suspended by a supersedeas bond or by order of a proper court” in both prongs of rule 621a. Therefore, the court holds that post-judgment discovery is permissible under the second prong of the rule even when the judgment debtor has posted adequate security for the judgment. The court also disagrees with Emeritus’ contention that real parties are not entitled to post-judgment discovery under the second prong of rule 621a because the trial court improperly considered Rule of Appellate Procedure 24 in its interpretation. The court holds that rule 621a incorporates the provisions of current Rule of Appellate Procedure 24 even though it still refers to former Rules of Appellate Procedure 47 and 49 in its text. Because the applicable rules of statutory construction required the trial court to construe Rule of Civil Procedure 621a together with Rule of Appellate Procedure 24, and not former Rules of Appellate Procedure 47 and 49, the court declines to say the trial court misinterpreted the scope or meaning of the second prong of rule 621a. Consequently, the court concludes that the trial court did not clearly fail to correctly analyze or apply Rule of Civil Procedure 621a when it granted the real parties’ request for post-judgment discovery and denied Emeritus’ motion to quash post-judgment discovery and for a protective order. OPINION:Stone, J.; Catherine Stone, Sarah B. Duncan, Sandee Bryan Marion, JJ.

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