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After spending 12 years in prison for a crime he did not commit and being beaten within an inch of his life by another inmate, few contest that Richard Danziger deserves compensation from the government. But can he also claim the compensation meant for another wrongfully imprisoned inmate? That was one of the tough questions Austin 3rd Court of Appeals had to answer in Texas v. Oakley, et al., a case involving the wrongful-imprisonment claim filed against the state of Texas by Danziger and Barbara Oakley, his legal guardian. In a 2-1 opinion released on Dec. 16, the court ruled that Danziger can accept assignment of another former inmate’s claim against the government. Danziger has been declared incompetent because of a brain injury he sustained while incarcerated when an inmate beat him. Danziger and Christopher Ochoa were convicted for the 1988 rape and murder of Nancy DePriest at an Austin pizza restaurant. Ochoa falsely confessed to the crime and falsely implicated Danziger as a participant, according to the 3rd Court’s opinion. In 1996, another man was linked to the crime and confessed, after an extensive investigation by the Travis County District Attorney’s Office. In 2001, Ochoa and Danziger were released from prison after the Texas Court of Criminal Appeals granted their habeas corpus petitions on the basis of actual innocence, according to the opinion. Ochoa and Danziger sued the city of Austin alleging civil rights violations. Ochoa settled the suit for $5.3 million and Danziger settled for $9 million. Danziger, through his guardian, then sued Ochoa for falsely implicating him in the murder. As part of a settlement agreement in that case, Ochoa assigned his right to any compensation he might receive in a suit against the state under Chapter 103 of the Texas Civil Practice & Remedies Code to Danziger. Frank Ivy, a partner in Austin’s Ivy, Crews & Elliott who represents Ochoa, did not return two telephone calls seeking comment before presstime on Dec. 22. Danziger and his guardian then sued the state of Texas as an assignee of Ochoa’s rights. Chapter 103 is intended to compensate people who have been wrongfully convicted and incarcerated by the state and are subsequently exonerated, by allowing them to collect up to $500,000 in damages. Chapter 103 also contains an explicit waiver of sovereign immunity, stating that such a wrongful-imprisonment suit “must be initiated by a verified person alleging that the petitioner is entitled to compensation.” Lawyers for the state attempted to have the suit dismissed, arguing to the trial court that Danziger and his guardian did not have standing to sue in Ochoa’s stead. They argued that Chapter 103 allows only a person who was “entitled to compensation” to bring the suit. The trial court denied the state’s plea to the jurisdiction, and the state appealed. In her majority opinion, 3rd Court Justice Bea Ann Smith acknowledged the restriction and that technically only Ochoa meets the definition of a person “entitled to compensation” under Chapter 103. But she wrote that under the common law, the principle of assignment is consistent with the principles of Chapter 103, and she overruled the state’s challenge. Lawyers for the state also argued that because Chapter 103 states that the right of a person to receive compensation under the statute terminates upon the person’s death, Chapter 103 claims are “personal” and are not transferable to someone else. However, Smith, in an opinion joined by Justice Jan Patterson, wrote that under the common law, Chapter 103 claims are assignable. “We hold that such a claim is not personal and that it is assignable even though the right to compensation terminates on the death of the wrongfully convicted person,” Smith wrote. “However, the assignee takes only those rights held by the assignor, and his right to repayment would terminate if the wrongfully convicted person dies.” Justice David Puryear dissented, writing that Chapter 103 claims are personal and are not assignable to someone else. “I believe that the majority’s allowance of the assignment impermissibly broadens the waiver of immunity beyond the legislature’s intentions,” Puryear wrote. GOOD CHANCE Scott Ozmun, a partner in Austin’s Whitehurst, Harkness Ozmun & Brees who represents Danziger and his guardian in the appeal, is pleased with the decision. “The general rule is that causes of action are assignable. And there are very limited exceptions to that. And basically you look to public policy reasons for why assignment should be allowed,” Ozmun says. “And the majority is dead on in terms of the history of designation of assignment. In this case Chapter 103 falls within the types of claims that are historically assignable.” The majority in Oakley noted that the assignment of personal injury claims has been the general rule in Texas for more than a century. However some claims are not assignable if they are personal and punitive in nature. Joel Thollander, an assistant solicitor general who defended the state on appeal, says he has not decided whether the state will appeal the ruling. But he agrees with the dissent’s position — that a wrongful-imprisonment claim can’t be assigned to someone else. “Even the majority concedes that technically only Ochoa could be entitled to compensation for the claim that is being brought,” Thollander says. “We argued that the statute reflects a clear intent that only one person deserves compensation… . That right can’t be assigned.” Ozmun says that Danziger and his guardian have filed their own Chapter 103 claim against the state. But they still want to collect on Ochoa’s claim as is their right, he says. “To be honest with you, I was surprised that [the state] would vigorously defend this,” Ozmun says. “This poor guy didn’t deserve this and he’s entitled to every penny he can get.” Thollander responds that he’s just defending the statute, which is his job. If the state decides to appeal the 3rd Court’s decision, there’s a good chance the Texas Supreme Court will hear it, says Charles “Rocky” Rhodes, a civil procedure professor at South Texas College of Law. “There’s been a lot of action lately with the assignability of claims. Generally under the common law, you could freely assign claims,” Rhodes says. “But lately the Supreme Court of Texas has been carving out exceptions. They carved out an exception for legal malpractice claims and for DTPA [Deceptive Trade Practices Act] claims” preventing them from being assigned. While Rhodes believes the 3rd Court was correct in its policy consideration of assigning claims, he says the high court may reverse the ruling on statutory grounds. “I think this case is going to be reversed because of some of the unique mechanics of the statute and some of its text,” Rhodes says. If the case goes Danziger’s way, he could end up with a strange result — recovering three times for the same injury, says Carl Reynolds, who was the Texas Department of Criminal Justice general counsel when Danziger sued the state. “He’s deserving. But it’s like a triple recovery in a sense,” says Reynolds, now general counsel of the Office of Court Administration. “The whole thing is tragic.”

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