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Transamerica Corp. v. Braes Woods Condo Association Inc.

Court of Appeals of Texas, Fourteenth District

April 24, 2018

TRANSAMERICA CORPORATION, Appellant
v.
BRAES WOODS CONDO ASSOCIATION INC., Appellee

          On Appeal from the 129th District Court Harris County, Texas Trial Court Cause No. 2016-12580

          Panel consists of Chief Justice Frost and Justices Christopher and Jamison.

          ORDER

          PER CURIAM

         This appeal arises from a suit filed by Transamerica Corporation of Houston against Braes Woods Condo Association seeking declaratory judgment, a temporary restraining order, and temporary and permanent injunctions. In the petition Transamerica is alleged to be a corporation owned by Yigal Bosch, who passed away on January 29, 2015. Bosch's son David Bash was named administrator of Bosch's estate and purports to bring suit on behalf of Transamerica. In the suit Transamerica is alleged to own three condominium units in the Braes Woods Condo Association. Transamerica alleged, among other things, that Braes Woods is renting the units owned by Transamerica and collecting rent. James O. Okorafor is the attorney purporting to represent Transamerica.

         Braes Woods filed a counterclaim seeking to recover for breach of an agreement made under Texas Rule of Civil Procedure 11, in which Braes Woods agreed to postpone foreclosure in exchange for Transamerica's agreement to pay homeowners' association fees. The trial court granted an interlocutory summary judgment in favor of Braes Woods based on its counterclaim for breach of contract and enforcement of the Rule 11 agreement.

         Braes Woods subsequently filed a plea to the jurisdiction and motion to show authority in which it asserts that Transamerica does not have standing to sue Braes Woods because it has no legally cognizable claim against Braes Woods. In the plea Braes Woods alleges that no legal entity named Transamerica Corporation of Houston exists, and that, if it did, Bash does not have authority to represent Transamerica.

         Included in the plea to the jurisdiction was a motion to show authority filed under Texas Rule of Civil Procedure 12.[1] In the motion Braes Woods alleged that James Okorafor, the attorney who purports to represent Transamerica, did not have authority to represent Transamerica in the suit. The trial court held a hearing on the motion to show authority. Okorafor did not respond to the motion, either in writing or orally at the hearing. The trial court granted the motion to show authority, struck Transamerica's pleadings, and noted that the court's order disposed of all claims. Okorafor filed a notice of appeal on behalf of Transamerica.

         In its brief on appeal Transamerica argues that the trial court lacked subject matter jurisdiction because Transamerica no longer exists as a legal entity. Alternatively, Transamerica argues that the trial court erred in granting summary judgment to Braes Woods on its counterclaims. Neither Transamerica nor Okorafor have complained on appeal about the trial court's ruling on the motion to show authority.

         Rule 12 of the Texas Rules of Civil Procedure permits any party to challenge an attorney's authority to prosecute or defend a lawsuit. Tex.R.Civ.P. 12. The rule's primary purpose is to enforce a party's right to know who authorized the suit. Angelina Cnty. v. McFarland, 374 S.W.2d 417, 422-23 (Tex. 1964). The challenged attorney must appear before the trial court to show the attorney's authority to act on behalf of the client. Tex.R.Civ.P. 12; R.H. v. Smith, 339 S.W.3d 756, 762 (Tex. App.-Dallas 2011, no pet.). At the hearing on the motion, the challenged attorney bears the burden of proof to show the requisite authority. Smith, 339 S.W.3d at 762. When resolving the motion, the trial court considers and weighs the evidence presented at the hearing. In re Guardianship of Benavides, 403 S.W.3d 370, 376 (Tex. App.-San Antonio 2013, pet. denied). A challenged attorney may satisfy the burden by producing an affidavit or testimony from the client indicating the attorney was retained to provide representation in the case. See In re Sassin, 511 S.W.3d 121, 125 (Tex. App.-El Paso 2014, orig. proceeding).

         The issue before the trial court was whether Okorafor had authority to represent Transamerica in the litigation. In ruling on the motion to show authority, the trial court did not address whether Transamerica or Bash had standing to bring the suit. Okorafor presented no evidence that he had authority to represent Transamerica. Therefore, Okorafor failed to meet his burden of proof in the trial court. See Smith, 339 S.W.3d at 762. On appeal, Okorafor has not challenged the trial court's ruling striking Transamerica's pleadings and finding that Okorafor does not have authority to represent Transamerica.

         An appellant must challenge all independent grounds supporting the judgment or legal conclusion under attack. Akhtar v. Leawood HOA, Inc., 525 S.W.3d 814, 819 (Tex. App.-Houston [14th Dist.] 2017, no pet.). Because Okorafor and Transamerica do not challenge the ruling striking Transamerica's pleadings and finding Okorafor has no authority to represent Transamerica, we accept the unchallenged finding and are bound by the trial court's ruling. See Walker v. Schion, 420 S.W.3d 454, 457-58 (Tex. App.-Houston [14th Dist.] 2014, no pet.).

         Therefore, Okorafor is not permitted to represent Transamerica in this appeal. Transamerica is before this court without representation by an attorney. Generally, corporations can appear and be represented only by a licensed attorney. Kunstoplast of Am., Inc. v. Formosa Plastics Corp., 937 S.W.2d 455, 456 (Tex. 1996); see Tex. R. Civ. P. 7; Unauth. Practice of Law Comm. v. Am. Home Assur. Co., 261 S.W.3d 24, 33 (Tex. 2008).

         The court will consider dismissal of this appeal unless Transamerica files a response, through an attorney, on or before May 4, 2018, showing meritorious grounds to continue its appeal. See Bosch v. Harris County, No. 14-13-01125-CV; 2015 WL 971317 (Tex. App.-Houston [14th Dist.] Feb. 26, 2015, no pet.) (mem. op.) (affirming trial court's ruling on Rule 12 motion and dismissing appeal).

          Chief Justice Frost respectfully dissents because (1) the trial court's order granting the motion to show authority addressed James Okorafor's authority to prosecute the suit on behalf of Transamerica Corporation of Houston, Inc. in the trial court in 2016; (2) this order does not address James Okorafor's authority to prosecute this appeal on behalf Transamerica in 2018; see Leonard v. Ivey, No. 14-15-00908-CV, 2016 WL 7478374, at *10 (Tex. App.-Houston [14th Dist.] Dec. 29, 2016, pet. denied) (mem. op.); (3) the proper procedure for appellee Braes Woods Condo Association, Inc. to dispute Okorafor's authority on appeal is to file a motion to ...


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