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Rules of Civil Procedure: Potential Game-Changers

Author: Michael R. Steinmark and Daniel P. Tobin

The Texas Rules of Civil Procedure (“TRCP”) and the Texas Civil Practice and Remedies Code (“CPRC”) are the predominant rulebooks for civil litigation in Texas state courts. There are 822 rules in the TRCP that govern every stage of litigation, with many rules having numerous subparts and intricacies. Likewise, the voluminous CPRC has many nuances affecting the outcome of civil lawsuits in Texas.

Generally every golfer, even a novice, will know the “major” rules of the game—how to keep score, how to penalize a ball hit out of bounds, etc. But even some of the most experienced golfers are unfamiliar with rules that can lead to penalties or advantages on which success or failure can turn.

Like golfers, trial lawyers and many litigation-savvy parties know the “major” rules in the TRCP and CPRC—when to file an answer, what discovery is permissible, what is required for summary judgment, etc. Familiarity with new, lesser-used, and nuanced rules of civil procedure, however, can give parties competitive advantages in litigation.

For example, Texas House Bill 274 (“HB 274”), enacted this past summer and effective as of September 1, 2011, broadens the availability of appeals before trial (and even discovery) in the trial court, known as “interlocutory appeals.” Parties will now be able to bring interlocutory appeals on trial court rulings on controlling questions of law where the appeal “may materially advance the ultimate termination of the litigation.” The new interlocutory appeal rules may help a party avoid the time and expense of full discovery and trial by having outcome-determinative legal issues finally decided through the court(s) of appeal.

Another significant change under HB 274 will be the adoption of “rules to provide for the dismissal of causes of action that have no basis in law or fact on motion and without evidence.” The Texas Legislature has directed the Texas Supreme Court to adopt such rules (as part of the TRCP), although no deadline has been set and fairly broad discretion has been given on the mechanics of the new rules. While the content and effective date of the new rules is thus uncertain, mandates in HB 274 ensure the new procedures will have a short time frame and will include a mandatory award of attorneys’ fees to the prevailing party—a significantly whittled-down remnant of the original “loser pays” concept that survived from the bill as originally proposed.

HB 274 also puts in place new rules for the designation of responsible third parties—people or entities that are not actually made defendants in the lawsuit, but whose responsibility a jury may consider in a comparative fault analysis thereby potentially reducing an actual party defendant’s liability exposure. Under these new rules, a defendant cannot designate a responsible third party who was not disclosed before the statute of limitations ran on claims against that party. Failure to follow these new rules may prevent a defendant from taking advantage of the potential liability-reducing benefits of responsible third party practice.

In addition to new rules, some lesser-used and nuanced rules can afford parties significant advantages in litigation. For example, Rule 167 of the TRCP puts in place settlement offer procedures that can make attorney’s fees and litigation costs recoverable where they might not otherwise be available. For a more detailed discussion of Rule 167, please see Rule 167 Offers: Encouraging Early Settlement, by J. Allen Smith and Katherine L. Killingsworth, SettlePou Newsletter Volume 6, Issue 4, available at http://www.settlepou.com/newsletter.html. Rule 167 was recently expanded by HB 274, which now allows a party to recover “reasonable deposition costs” in addition to attorneys’ fees, court costs, and reasonable fees for up to 2 testifying expert witnesses.

Other lesser-used and nuanced rules in the TRCP with potential strategic impacts include:

• Rule 1 – states that the purpose of the rules is to ensure that the parties receive a just, fair, equitable, and impartial adjudication of the rights. This may serve as authority for equitable motions not specifically governed by other rules.

• Rule 6 – prohibits a lawsuit from being commenced or served on a Sunday. This can be critical for default judgments or other issues related to perfecting service.

• Rule 12 – allows a party to challenge the authority of an attorney to represent a party and requires that the attorney respond by proving its authority to the Court. This can be useful in cases where questions arise as to an opposing party’s actual authorization of an attorney to take certain actions on the party’s behalf.

• Rule 176.3 – states that a subpoena, when issued to a person or company that is not a party to the lawsuit, may not require the witness to appear or produce documents in a county more than 150 miles from where the witness resides or is served. Given the size of the State of Texas, this can be an important limitation when either defending or prosecuting a lawsuit. For instance, it can mean that a subpoena issued in Dallas would not be enforceable on a nonparty witness residing in San Antonio. If the discovery deadline passes before the party issuing the subpoena realizes the error, the requested discovery could be prevented, which in certain instances could have a significant impact on the outcome of a case.

• Rule 202 – allows a person to obtain court permission to take a deposition to investigate a potential claim or in anticipation of a lawsuit, but before a suit is actually filed. This rule can be very useful in obtaining information from third parties before a potential defendant is aware of a potential suit.

• Rule 263 – presents an alternative to a traditional trial by allowing parties to agree to the facts of a case in writing and submit those facts to the court for the judge to render judgment by applying the law to the agreed facts. Although not practicable in every case, this rule can significantly reduce the time and expense of full litigation, can ensure judgment is rendered (which is not guaranteed with competing summary judgment motions), and can limit appellate issues.