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Aubrey v. Aubrey

Court of Appeals of Texas, Fifth District, Dallas

June 7, 2017

STEVEN B. AUBREY, Appellant
v.
BETSY S. AUBREY, TRUSTEE OF THE AUBREY FAMILY TRUST CREATED UNDER THE WILL OF RICHARD BUCK AUBREY, DECEASED, Appellee

         On Appeal from the 14th Judicial District Court Dallas County, Texas Trial Court Cause No. DC-15-11685

          Before Justices Lang, Myers, and Stoddart.

          OPINION

          DOUGLAS S. LANG JUSTICE.

         Appellant Steven B. Aubrey, [1] proceeding pro se, filed the underlying lawsuit seeking to remove appellee Betsy S. Aubrey, Trustee of the Aubrey Family Trust Created Under the Will of Richard Buck Aubrey, Deceased, ("Betsy") as trustee of the Aubrey Family Trust ("the Trust"). The trial court signed a judgment declaring appellant a vexatious litigant, dismissing the lawsuit with prejudice, and granting Betsy sanctions against appellant.

         On appeal, we construe appellant's issues to assert that the trial court erred by (1) granting Betsy's motion to declare him a vexatious litigant and (2) awarding the sanctions described above.[2] We decide in favor of appellant on a portion of his second issue and against appellant on his first issue and the remaining portion of his second issue. We affirm the trial court's judgment, in part; reverse the judgment, in part; and remand this case for further proceedings consistent with this opinion.

         I. FACTUAL AND PROCEDURAL CONTEXT

         Upon the death of Richard Buck Aubrey in 2004, his will ("the Will") provided for creation of the Trust and appointed his spouse, Betsy, as the trustee.[3] Additionally, the Will stated that at the time of signing, Richard Buck Aubrey had the following children: Richard B. Aubrey Jr. ("Junior"), Thomas Alan Aubrey, and appellant.

         Appellant filed the underlying lawsuit on September 23, 2015, seeking to remove Betsy as trustee of the Trust based on breach of fiduciary duty and "self-dealing." In his petition, appellant stated in part (1) "[Betsy] is the current income beneficiary of the Trust"; (2) "[a]ll of the net income from the Trust must be annually distributed to [Betsy]"; (3) "[Betsy] may utilize any part of the Trust principal assets if needed for her health, support or maintenance"; and (4) "[t]he 3 sons are vested remainderman [sic] because the Trust properties will vest in them when [Betsy] dies and be divided equally, with no further conditions (also properly referred to as future interest beneficiaries whose remainder becomes possessory upon [Betsy's] death)" (emphasis original). Further, appellant contended (1) with the help of accountant David Hendricks and attorney Ira Tobolowsky, Junior has "tricked" Betsy into signing deeds for "sham" transactions that "unlawfully stripped" assets from the Trust; (2) in approximately 2007, Junior "tricked [Betsy] into signing a deed that unlawfully stripped the first asset (valued at $2.5 million) from the Trust into his empty shell [corporation], giving nothing in return"; (3)"[a]gainst the terms of the Trust, all of the net income flows to Junior, not to [Betsy]"; (4)"[e]vidence that [Betsy] is damaging herself, the Trust and its beneficiaries is profound throughout [her] December 8, 2014 deposition" taken in a previous case filed against her by appellant that resulted in a dismissal; (5) Betsy is "frail and confused" and her deposition testimony described above "indicates her complete inability to direct, manage or oversee this Trust (or any trust)"; (6) "[Betsy's] unlawful deed transfers prove she repeatedly breached her duty"; (7) "Trustee has not shown good faith in administering the trust and performing the duties imposed on her by common law pursuant to Prop. Code § 113.051, " see Tex. Prop. Code Ann. § 113.051 (West 2014); (8) "[Trustee] has breached her fiduciary duty, she has been caught self- dealing and she is willfully ignoring the law and must be removed from the Trust for her violations of Prop. Code § 113.082(a)(1)(2)(3) and (b), " see id. § 113.082; and (9) "[t]he pattern of secreting properties has been ongoing." Specifically, appellant stated in part,

On June 27, 2013, Junior, Tobolowsky, and Hendricks conspired to fraudulently transfer a Trust asset in Travis County out of the Trust. The scam included three sham transactions on one day:
a) Betsy Aubrey, Trustee transferred the property to Betsy Aubrey, Individually; (without consideration)
b)Betsy Aubrey, Individually transferred the property to her son Junior (without consideration); and
c) Junior sold the property for $300, 000 to United Heritage Credit Union.
The first two transfers are rendered void by law because no consideration was given to the Trust or to Mrs. Aubrey, Individually in return for the real property. Junior used a fraudulent address on his third deed transfer, put $300, 000 in his pocket, and left the Trust with nothing at all. Transferring property without consideration directly violates the terms of the Trust and violates TEXAS PROPERTY CODE §113.010. The beneficiaries of the Trust are the owners of the Trust assets, not the Trustee. Because Mrs. Aubrey is not the owner of the Trust assets, Texas law prevents "gifting" assets that do not belong to her.

(emphasis original).

         Betsy filed a general denial answer. Additionally, on December 18, 2015, Betsy filed a combined "Motion to Determine Vexatious Litigant and Motion for Sanctions." Therein, Betsy stated in part that "[i]n the last seven years, Plaintiff has commenced, prosecuted or maintained more than five litigations (other than in small claims court) that have been determined adversely to Plaintiff (or have been dismissed by Plaintiff), " including, in part, (1) "Cause No. C-1-PB-14-000668, styled, Steven B. Aubrey v. Betsy Stirratt Aubrey, filed in Probate Court No. 1 of Travis County, Texas"; (2) "Cause No. 05-14-01172-CV, styled, In Re: Steven B. Aubrey, Realtor v. the Honorable Michael Miller, filed in the 5th Court of Appeals, Texas"; (3) "Cause No. 15-CV-1792, styled, Steven B. Aubrey v. the Honorable Ingrid Michelle Warren, filed in the United States District Court, Northern District of Texas"; (4) "Cause No. D-1-GN-13-003586, styled, Steven Aubrey v. Susan Stieg, filed in the 200th District Court of Travis County, Texas"; and (5) "D-1-GN-08-003721, styled, Brian Vodicka v. Southern Methodist University, et al., filed in the 250th District Court of Travis County, Texas." Also, Betsy asserted (1) "there is not a reasonable probability that Plaintiff will prevail in the current litigation" because he "lacks standing to bring this lawsuit"; (2) pursuant to Chapter 10 of the Texas Civil Practice and Remedies Code, see Tex. Civ. Prac. & Rem. Code Ann. §§ 10.001-.006 (West 2002), she was requesting a monetary sanction against appellant in the amount of her reasonable and necessary attorney's fees and expenses she necessarily incurred in this case and six others previously filed against her by appellant, as well as "for prosecuting this Motion"; and (3) a sanction in the amount of $350, 000.00 is "just and reasonable" because "Plaintiff's frivolous tactics and allegations have forced Betsy Aubrey and the Aubrey Family Trust to defend Defendant Betsy Aubrey in the prior lawsuits."

         Further, in a February 5, 2016 supplemental motion to her combined motions, Betsy asserted several additional "grounds for contending that there is no reasonable probability that Plaintiff will prevail in the current lawsuit." Specifically, Betsy stated in part (1) she "has committed no wrongs that give rise to her removal as Trustee of the Aubrey Family Trust, a Trust for which she is the sole beneficiary, " and (2) appellant "seeks improper relief."

         Appendices to Betsy's motions contained, among other things, (1) a copy of the Will; (2) copies of pleadings and court orders pertaining to the filing and disposition of thirteen litigations described in Betsy's motions, including the five litigations described above; (3) emails between appellant and Betsy showing a contentious relationship between them, including a December 2012 email from Betsy informing appellant she has "excluded" him "from any inheritance" and a response by appellant to Betsy several hours later stating in part, "You have 3 days to change your mind and apologize . . . . Or else I will make it my mission to make the rest of your life miserable, as you deserve"; and (4) signed "declarations" by Tobolowsky and Hendricks respecting facts supporting Betsy's assertions in her motions.[4] Specifically, Tobolowsky's declarations stated in part (1) "[i]t is my opinion that the numerous lawsuits identified above which have been brought by Steven B. Aubrey, pro se, against his mother, Betsy Aubrey, have been brought for improper purposes, including to harass and to needlessly increase her cost of litigation"; (2) "[i]t is my further opinion that the claims alleged by Steven B. Aubrey against his mother are frivolous, unwarranted, and have no evidentiary support, and no prospect of any evidentiary support"; (3) "I am familiar with what constitutes reasonable and necessary legal services and what constitutes fair and reasonable attorney fees throughout the State of Texas"; and (4) "[i]t is my opinion that $250, 000.00 constitutes fair and reasonable legal fees for the reasonable and necessary legal services I have rendered and performed on behalf of Betsy Aubrey in her defense of the above identified lawsuits brought against her by her son Steven B. Aubrey." The declaration by Hendricks stated in part (1) "I have performed both legal services and accounting services on behalf of Betsy Aubrey, both in her individual capacity and in her capacity as Trustee of the Aubrey Family Trust"; (2) "[a]ll income generated by the assets of the Aubrey Family Trust are [sic] paid to Betsy Aubrey as required by the terms of the Trust"; (3) the transfer to Betsy of the Trust property located in Travis County described above was made to pay off a $200, 000.00 indebtedness owed to Betsy by the Trust that resulted from a previous transaction; and (4) "Steven Aubrey is wrong in his allegations that Betsy Aubrey committed an impropriety in transferring to herself the [Travis County] property."

         Appellant filed a February 9, 2016 "Response to [Betsy's] Motion to Determine Vexatious Litigant and Motion for Sanctions" in which he asserted he has standing to bring this lawsuit pursuant to certain definitions contained in Texas Property Code section 111.004. See Tex. Prop. Code Ann. § 111.004. Also, as to the other litigations described by Betsy in her motions, appellant contended (1) "Trustee's overzealous use of the 'copy/paste' feature becomes evident by regurgitating the same cases repeatedly to make it appear as though [appellant] has been a pro se and unsuccessful plaintiff in dozens and dozens of lawsuits" and (2) "[appellant] will save the Court's valuable time and not even address the diversionary pile of spaghetti created in Trustee's motion." Further, as to the transfer of the Travis County property described above, appellant repeated verbatim the same allegation set forth above, but substituted "Trustee, Junior and David Hendricks" for "Junior, Tobolowsky, and Hendricks" as the acting persons described in the first sentence of that allegation. Additionally, as to Hendricks's declaration described above, appellant stated in part as follows:

Trustee's CPA . . . submitted his declaration, which does not offer any reasons for why or why not Trustee should be removed. This declaration is designed to justify the improper transfer of property in Travis County, Texas with an unintelligible attempt to explain a phantom $200, 000 indebtedness owed to Trustee. However, this declaration does not address the missing $100, 000 from the sale of the property for $300, 000.

         Finally, in the conclusion of his response, appellant argued in part (1) "all of the money earned by the trust properties bypasses Trustee and goes directly to Junior"; (2) "Trustee has transferred trust properties away from the trust and into Junior's name, actions that are against the terms of the Aubrey Family Trust and are criminal"; (3) "[Plaintiff] HAS filed multiple actions, WITH MERIT, that involve the Trust, but all have been met with malicious, vexatious, frivolous, and tactical defensive motions" (emphasis original); and (4) "Trustee is a vexatious defendant trying to maintain the current level of litigation to hide the truth about multiple assets she has gifted out of the Trust, that were to be held in her capacity as a Trustee."

         Attached to appellant's response to Betsy's motions were exhibits that included (1) emails between Betsy and her son Thomas Alan Aubrey in which Betsy stated in part, "Of course I never know what's going on. I just sign what I'm told to sign"; (2) excerpts from the 2014 oral deposition of Betsy described above, including answers of "I don't know" by Betsy in response to numerous questions pertaining to the Trust, and testimony by Betsy that Junior manages the Trust for her, she "gave" the Travis County property described above to Junior, he did not "give her any money back" for that property because it was "in payment for his work on the property, " she does not know what "fiduciary" means, and she believes she "do[esn't] have a responsibility much" respecting the Trust; (3) a 2014 order signed by the presiding judge of Probate Court No. 3 of Dallas County in an action by appellant against Betsy, stating that the probate court had heard a "Motion to Compel Accounting under Section 113.151 of the Texas Trusts Code" in that case and concluded appellant was entitled to "demanded accountings" respecting the Trust; and (4) a November 12, 2015 order signed by a district court in Travis County in a lawsuit by appellant against United Heritage Credit Union ("United Heritage"), denying a motion by the defendant in that case to determine appellant a vexatious litigant. Additionally, on February 9, 2016, an "Entry of Appearance" was filed by Brian Vodicka as attorney for appellant.

         A hearing on Betsy's motions was held on February 12, 2016. Neither appellant nor his counsel appeared at the hearing. At the start of the hearing, the trial court asked Betsy's counsel if he had "seen or heard from" the opposing party. Betsy's counsel replied that he had "received a Motion for Continuance over the internet" on the preceding day. The trial judge stated he had "not seen that, " then stated to Betsy's counsel, "The Court's ready to proceed if you are." A "book" of documents compiled by Betsy's counsel was admitted into evidence. Those documents included the same documents contained in the appendices to Betsy's motions described above. Further, counsel for Betsy argued appellant could not prevail in the current litigation for three reasons: (1) "[Betsy] has done nothing wrong" and "[e]verything she has done has been on advice of counsel, has been through the guidance of her C.P.A. and lawyer"; (2) "[appellant] simply doesn't have standing to bring this lawsuit"; and (3) "the fact is there is a trust committee set up in the Will that is empowered with the authority to replace the trustee and to select substitute trustees" and "[t]his Court just simply doesn't have the power to overrule the trust committee in the Will itself." Additionally, counsel for Betsy (1) specifically described four of the litigations described above that were previously filed by appellant and (2) stated to the trial court that the documents admitted into evidence showed other pro se litigations brought by appellant, for a total of thirteen. After Betsy's arguments, the trial court stated in part that (1) it was "making a specific finding that the Motion to Determine Vexatious Litigant is granted and that the Plaintiff is hereby determined to be a vexatious litigant" and (2) appellant must furnish security within ten days in the amount of $150, 000.00 or the case would be subject to dismissal. Then, counsel for Betsy stated (1) Betsy was requesting $250, 000.00 in sanctions against appellant and (2) that request was supported by statements made by counsel respecting his attorney's fees in his declaration described above. The trial court stated in part, "I'm going to trouble you to do a little bit more work, and that is to file-or submit to the Court a separate order with regard to your sanctions, your application for attorneys' fees as well, and I will not require another hearing, but I will consider that separately upon its receipt."

         The trial court signed orders dated February 12, 2016, and February 18, 2016, granting, respectively, Betsy's motions "to determine vexatious litigant" and for sanctions.[5] On February 22, 2016, appellant, acting through counsel, filed a "Motion for Reconsideration of the Order Granting Defendant's Motion to Determine Vexatious Litigant and Motion for Sanctions." Therein, appellant contended in part "[t]he [trial court] erred, as the abundance of evidence supporting this action for removal of trustee cannot presume that [appellant] does not have a reasonable probability to prevail in the litigation." Additionally, appellant, acting pro se, and counsel for Betsy sent separate letters to the trial court dated March 24, 2016, and March 23, 2016, respectively, requesting the trial court to combine the "previous Orders of this Court" into an "Amended and Restated Final Judgment."

         The trial court signed a "Final Judgment Nunc Pro Tunc" dated March 25, 2016.[6] This pro se appeal timely followed.

         II. VEXATIOUS LITIGANT

         A. Standard of Review

         We review a trial court's declaration that a litigant is vexatious for an abuse of discretion. Harris v. Rose, 204 S.W.3d 903, 905 (Tex. App.-Dallas 2006, no pet.); accord Cooper v. McNulty, No. 05-15-00801-CV, 2016 WL 6093999, at *2 (Tex. App.-Dallas Oct. 19, 2016, no pet.) (mem. op.). Under this standard, we are not free to substitute our own judgment for the trial court's judgment. Harris, 204 S.W.3d at 905. We can find an abuse of discretion only if the trial court acts in an arbitrary or capricious manner without reference to any guiding rules or principles. Id.; see also Cooper v. Campbell, No. 05-15-00340-CV, 2016 WL 4487924, at *5 (Tex. App.-Dallas Aug. 24, 2016, no pet.) (mem. op.) ("[A]n abuse of discretion does not occur when a trial court bases its decision on conflicting evidence, as long as some evidence reasonably supports the trial court's decision.").

         Further, where, as here, findings of fact and conclusions of law are not requested or filed, we "imply all facts necessary to support the trial court's judgment that are supported by the evidence and must affirm the trial court's judgment if it can be upheld on any legal theory supported by the evidence." Rossman v. Bishop Colo. Retail Plaza, L.P., 455 S.W.3d 797, 808 (Tex. App.-Dallas 2015, pet. denied); accord Weisfield v. Tex. Land Fin. Co., 162 S.W.3d 379, 381 (Tex. App.-Dallas 2005, no pet.).

         B. Applicable Law

         Chapter 11 of the Texas Civil Practice and Remedies Code is titled "Vexatious Litigants." See Tex. Civ. Prac. & Rem. Code Ann. §§ 11.001-.104 (West 2002 & Supp. 2016). Pursuant to section 11.051, a defendant in a litigation may, within a specified time period after filing an answer, move the trial court for an order determining that the plaintiff is a vexatious litigant and requiring the plaintiff to furnish security. Id. § 11.051. Further, section 11.054 provides in part,

A court may find a plaintiff a vexatious litigant if the defendant shows that there is not a reasonable probability that the plaintiff will prevail in the litigation against the defendant and that:
(1) the plaintiff, in a seven-year period immediately preceding the date the defendant makes the motion under Section 11.051, has commenced, prosecuted, or maintained at least five litigations as a pro se litigant other than in a small claims court that have been:
(A) finally determined adversely to the plaintiff . . . .

Id. § 11.054(1)(A). If the trial court determines that the plaintiff is a vexatious litigant, it is required to order the plaintiff to furnish security for the benefit of the moving defendant and determine the date by which the security must be furnished. Id. § 11.055(a)-(b). If the plaintiff does not furnish the security within the time set by the trial court's order, the trial court must dismiss the litigation. Id. § 11.056.

         The "Texas Trust Code" is contained in subtitle B of Title 9 of the Texas Property Code. See Tex. Prop. Code Ann. §§ 111.001-117.012 (West 2014 & Supp. 2016). Section 113.051 of the trust code describes the "General Duty" of a trustee as follows:

The trustee shall administer the trust in good faith according to its terms and this subtitle. In the absence of any contrary terms in the trust instrument or contrary provisions of this subtitle, in administering the trust the trustee shall perform all of the duties imposed on trustees by the common law.

Id. § 113.051. Further, section 113.082 of the trust code is titled "Removal of Trustee" and provides in part,

(a) A trustee may be removed in accordance with the terms of the trust instrument, or, on the petition of an interested person and after hearing, a court may, in its discretion, remove a trustee and deny part or all of the trustee's compensation if:
(1)the trustee materially violated or attempted to violate the terms of the trust and the violation or attempted violation results in a material financial loss to the trust;
(2)the trustee becomes incapacitated or insolvent;
(3)the trustee fails to make an accounting that is required by law or by the terms of the trust; or
(4)the court finds other cause for removal.
(b)A beneficiary, cotrustee, or successor trustee may treat a violation resulting in removal as a breach of trust.

Id. § 113.082(a)-(b). The trust code's definition of "interested person" states as follows:

"Interested person" means a trustee, beneficiary, or any other person having an interest in or a claim against the trust or any person who is affected by the administration of the trust. Whether a person, excluding a trustee or named beneficiary, is an interested person may vary from time to time and must be determined ...

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