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Click here for the full text of this decision FACTS:On June 1, 2007, two separate suits were filed in the trial court. The first suit, styled Texas Hematology/Oncology Center PA v. Patients’ Comprehensive Cancer Center LP arose out of a rent dispute under a written lease between the named parties executed in August 2001. In the lease lawsuit, Texas Hematology/Oncology Center (THOC) argued that there was a “mutual mistake” in the amount of square footage allocated to THOC in the lease and sought an order of rescission voiding the lease and ordering the parties to renegotiate the lease. THOC contended that in September 2006, it discovered that its office space contained less square footage than agreed upon in the lease. THOC says that it retained rent payments equal to the amount it claims to have overpaid during the entire lease period before the discovery of the alleged square footage discrepancy. Patients’ Comprehensive Cancer Center LP (PCCC LP) sought to recover this “delinquent rent” through its counterclaim, asserting THOC has been in arrears on rent since September 2006. The second suit, Patients’ Comprehensive Cancer Center GP LLC v. Gulf Coast Business Development Corp., is referred to by the parties as the usury lawsuit or usury/fraud case. Patients’ Comprehensive Cancer Center GP LLC (PCCC LLC) asserted that Gulf Coast made an agreement with PCCC LP to restate and amend the partnership’s financial statements to reflect a capital contribution made by Gulf Coast as an interest-bearing partnership loan. PCCC LLC alleged that this transaction was usurious and the execution of a document in connection with the transaction was allegedly “obtained through fraud.” The facts giving rise to the suit allegedly occurred in May 2006. The relationships between the individuals and entities involved in the two suits were complex. Dr. Dennis Birenbaum’s medical practice is THOC. Dr. Mark D’Andrea’s medical practice is Patients’ Comprehensive Diagnostic & Radiation Center Inc. (PCD&R). Both of these medical practices, THOC and PCD&R are tenants in the same building. PCCC LP owned the building; its partners consisted of Birenbaum as an individual and other entities in which Birenbaum and D’Andrea were members or shareholders. As owner of the building, PCCC LP leased portions of the building to THOC and PCD&R and was their landlord. PCCC LP consisted of one general partner and two limited partners. The general partner, PCCC LLC, had a 1 percent interest in PCCC LP. The limited partners of PCCC LP are Birenbaum, individually, and Gulf Coast, which each held a 49.5 percent interest in PCCC LP. Gulf Coast is a closely held corporation. D’Andrea is one of the two shareholders of Gulf Coast and serves as its president. PCCC LLC, the 1 percent general partner of PCCC LP, consisted of two 50 percent members: Birenbaum, individually, and Gulf Coast. Birenbaum participated directly as an individual in the capacity of a limited partner in PCCC LP and a member of PCCC LLC. D’Andrea’s involvement in both entities is through Gulf Coast, a closely held corporation. On Aug. 16, 2007, Birenbaum, acting as a member of PCCC LLC, joined the usury/fraud case “ex rel” on behalf of PCCC LP. D’Andrea, the president of Gulf Coast, and Kirk Kennedy, the vice president and general counsel to Gulf Coast, were joined as defendants under a fraud claim in the usury lawsuit. The real parties in interest (Birenbaum, derivatively on behalf of involuntary plaintiffs PCCC LP and PCCC LLC, and as general partner of PCCC LP; THOC PA; D’Andrea; PCD&R; and Kennedy) filed a motion to consolidate both suits in the trial court. In their motion, real parties asserted the requirements of Texas Rule 174 of Civil Procedure, which governs consolidation, were met and consolidation was appropriate to “avoid unnecessary costs and prevent delay.” The real parties in interest asserted that the requirements for consolidation were met, because: 1. the claims arose out of a single protracted partnership dispute; 2. common issues of fact and law predominated; 3. the witnesses and evidence were interwoven between the claims; and 4. consolidation would enhance the jury’s understanding and avoid jury confusion. Moreover, the real parties in interest asserted in the trial court that if the suits were not consolidated, both sides would “risk adverse res judicata.” Relator Gulf Coast Business Development Corp., individually and derivatively on behalf of PCCC LP, responded that the requirements of Rule 174 had not been met, because there were no common issues of fact or law between the two suits and consolidation would result in jury confusion and prejudice. At the hearing on the motion to consolidate, the real parties in interest argued that the cases “involve[d] claims between partners or related entities” and basically consisted of a “partnership dispute” between two doctors. The real parties in interest did not articulate any shared facts or questions of law in the motion to consolidate or at the hearing on the motion. The relators argued that consolidation was not appropriate, because there were no shared facts or questions of law and consolidation would cause jury confusion and prejudice. Subsequent to the hearing, the trial judge ordered consolidation of the lease suit and usury suit. The relator filed a petition for mandamus relief objecting to the consolidation. HOLDING:The court conditionally granted the writ of mandamus. Mandamus relief, the court stated, is available when the trial court abuses its discretion or violates a legal duty and there is no adequate remedy at law. Rule 174, the court stated, governs consolidation of actions. Rule 174(a) provides that when actions involving a common question of law or fact are pending before a trial court, the court: may order a joint hearing or trial of any or all the matters in issue in the actions; may order all the actions consolidated; and may make such orders concerning proceedings therein as may tend to avoid unnecessary costs or delay. The use of the permissive word “may,” the court stated, imports the exercise of discretion in such matters. But the trial court is not vested with unlimited discretion, the court stated. In deciding whether to consolidate, the trial court must balance the judicial economy and convenience that may be gained by the consolidation against the risk of an unfair outcome because of prejudice or jury confusion. The relators contended that the two suits were dramatically different. One is a usury claim related to a restated partnership loan and allegations of fraud in that transaction which occurred in May 2006. The other is a suit for declaratory judgment respecting an asserted mutual mistake of fact as to a lease executed in August 2001 and a dispute over payment of rent under that lease. On the other hand, the real parties in interest argued that “there is involvement of some of the same parties in both suits and, ultimately, behind the various entities and disputes are just two individuals[:] Dr. Dennis Birenbaum and Dr. Mark D’Andrea.” The real parties in interest, the court stated, failed to cite one instance where any actual common issues of law or fact were shared in the two actions. In fact, the uncontested description of the suits demonstrated a material difference in the legal nature of each. The issues in the usury suit were whether the interest on the restated loan is usurious and whether there was fraud in the transaction that converted a capital contribution by one party into a partnership loan. On the other hand, the issues in the lease suit involved a dispute over rent payments. Furthermore, the relators contended that consolidation of the cases for trial will be confusing and prejudicial for a number of reasons. First, the relators argued that two different and opposing sets of attorneys would represent PCCC LP in each case, sometimes speaking for the partnership and sometimes for the party suing it. Second, issues concerning witnesses’ testimony relating to the usury suit issues coupled with the same witnesses’ testimony (but in different legal and corporate capacities) relating to the rent suit would be confusing and prejudical. Third, the “boot strapping” of unrelated alleged bad acts from one suit would poison the jury as to claims in the other suit. On the other hand, the real parties in interest contended that the facts will not change and that the relators must “live with their bad facts.” Additionally, the real parties in interest contended that, even were the cases not consolidated, pursuant to Rule 51 they could nonsuit the usury dispute and add the usury claims to the rent dispute suit. On this record, the court concluded that no evidence demonstrated that the real parties in interest met their burden to show the existence of common issues of law or fact needed for consolidation under Rule 174. The two cases stem from materially different operative facts and law applicable to each case, the court stated. Moreover, the court stated that “even if we were to accept the assertion there are commonalities as required by rule 174(a), any convenience that might be obtained by consolidation is outweighed by the substantial difference in each case and the risk of unfair outcome because of prejudice or confusion by the jury.” Next, the court found that “were these lawsuits to be tried together to a jury, there exists a likelihood that an appellate court could not untangle how or whether prejudice and confusion infected the jury’s deliberations.” Thus, the court found no adequate remedy at law for the relators. OPINION:Lang, J.; Wright, O’Neill and Lang, JJ.

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