IMMERGUT, District Judge.
OPINION AND ORDER
IMMERGUT, District Judge.
This Court held a pretrial conference on April 29, 2021, at which the Court made numerous rulings on the record and ordered a continuation of the pretrial hearing on Monday, May 3, 2021, to address outstanding issues. This opinion provides more detail of this Court's reasoning for some of the evidentiary rulings made on the record. A. Defendant's motion in limine regarding Defendant's prior convictions
Defendant moved in limine to exclude admission of his prior felony convictions for any purpose. ECF 141. For purposes of this motion, ECF 141, this Court considers only the impeachment purpose and Federal Rule of Evidence 609.
The Government stated that it intends to offer the following felony convictions for impeachment purposes if Defendant testifies: (1) felon in possession of a firearm (convicted on November 16, 2012, in the United States District Court for the District of Oregon; 96 months imprisonment); (2) felon in possession of a firearm (convicted on May 3, 2006, in the Circuit Court for the State of Oregon for the County of Tillamook; 21 months imprisonment); (3) attempt to elude police-vehicle (convicted on June 29, 2005 in the Circuit Court for the State of Oregon for the County of Columbia; 30 months imprisonment); and (4) hit-and-run-vehicle-injury (convicted on June 25, 2003 in the Circuit Court for the State of Oregon for the County of Tillamook; 18 months imprisonment). ECF 134 at 10-11 (Government's Trial Memorandum).
This Court reserves ruling until "hearing the defendant's actual, in-court testimony" because "an advance ruling requires speculation by the district court concerning what the defendant will say while on the stand." United States v. Browne, 829 F.2d 760, 762 (9th Cir. 1987). This permits Defendant to "consider the possibility that his prior conviction would be used to impeach him should he decide to testify and to plan his testimony accordingly." Id.
If and when Defendant testifies, this Court will apply the five Cook factors governing admissibility for impeachment purposes. Those factors are: (1) the impeachment value of the prior crime; (2) the point in time of the conviction and the witness's subsequent history; (3) the similarity between the prior offense and the offense charged; (4) the importance of the defendant's testimony; and (5) the centrality of the issue of defendant's credibility. See United States v. Jimenez, 214 F.3d 1095, 1098 (9th Cir. 2000)) (referring to the "five Cook factors"); see also United States v. Cook, 608 F.2d 1175, 1185 n.8 (9th Cir. 1979) (en banc). The government bears the burden of establishing that any probative value outweighs its prejudicial effect. United States v. Hendershot, 614 F.2d 648, 653 (9th Cir. 1980).
Additionally, under Rule 609(b), a conviction more than ten years old is admissible for impeachment "only if" (1) "its probative value, supported by specific facts and circumstances, substantially outweighs its prejudicial effect," and (2) "the proponent gives an adverse party reasonable written notice . . . ." Fed. R. Evid. 609(b); see also Simpson v. Thomas, 528 F.3d 685, 690 (9th Cir. 2008). The Government acknowledges that the 2003, 2005, and 2006 convictions are covered by this more stringent provision. ECF 147 at 2. The Government's briefing did not explain how that "higher standard" is satisfied here, which the Government will be required to do in order for the Court to consider any of these three convictions for impeachment. B. Defendant's motion in limine regarding informant information
Defendant moves in limine to admit evidence of third party culpability under Rule 404(b). ECF 150. "Fundamental standards of relevancy, subject to the discretion of the court to exclude cumulative evidence and to insure orderly presentation of a case, require the admission of testimony which tends to prove that a person other than the defendant committed the crime that is charged." United States v. Armstrong, 621 F.2d 951, 953 (9th Cir. 1980). "In other words, Armstrong dictates that all evidence of third-party culpability that is relevant is admissible, unless barred by another evidentiary rule." United States v. Espinoza, 880 F.3d 506, 511 (9th Cir. 2018). With respect to Rule 404(b), while the Ninth Circuit does not permit "classic propensity evidence," its Rule 404(b) analysis is more generous when the similar acts evidence is offered by the defendant, rather than the government. United States v. Wright, 625 F.3d 583, 608 (9th Cir. 2010); see also United States v. Aboumoussallem, 726 F.2d 906, 911-12 (2d Cir. 1984) (explaining policy reasons of Rule 404(b)); Espinoza, 880 F.3d at 514-516 (explaining that its third party culpability analysis "is not transferable" to a situation where government seeks to introduce evidence respecting defendant).
Applying those standards here, this Court finds that the following evidence is admissible to prove the third party's intent, ability, motive, and/or opportunity to possess and distribute methamphetamine with intent to deliver, and to possess firearms: (1) the third party/informant's 2018 convictions involving drugs and/or guns, (2) testimony concerning that person's activities two weeks prior to the charged conduct, and (3) a photograph of that person (subject to a protective order preventing publishing to the jury). ECF 150 at 4-6. Defendant may show the photograph of the informant to Officer Garland and a defense witness to establish that the person in the photograph provided the tip about Defendant Krumwiede, and to establish the witness has seen that same person carrying a backpack like the one found in the Mitsubishi car that Defendant Krumwiede entered on February 4, 2018. This evidence is relevant and supports Defendant's theory that the Government "got the wrong guy" by making it at least somewhat less likely that Defendant had the knowledge and/or intent required to commit the charged acts.
However, this Court finds "evidence of multiple firearms found at the individual's home" in 2017, ECF 150 at 5, inadmissible under Rule 403. Defendant proposes to have two of the Government's witnesses testify as to this search. Id. However, a detailed discussion of a search in 2017 of the third party's home risks creating a trial within the trial. Any probative value of this evidence is substantially outweighed by a danger of confusing the issues, misleading the jury, undue delay, wasting time, and needlessly presenting cumulative evidence. B ompany to secure information as to whether any property had been rendered for taxation or not. It was not the type of contract which is commonly referred to as a 'tax ferret contract'.").
White, 114 S.W.2d at 862-63.
Pritchard & Abbott v. McKenna, 350 S.W.2d 333, 338 (Tex. 1961) (holding that Galveston County's contract with a private appraisal firm which had the "only purpose and objective" of ensuring "'that all properties may be properly valued for the purpose of taxation and values thereof equalized'" was not a tax ferret contract).
White, 114 S.W.2d at 863-64 (contingent-fee tax ferret contract violated a statute that capped contingent-fee rate, required the Comptroller's and Attorney General's approval, and stated any noncompliant contract was void).
Because contingent-fee arrangements can be unfair and unjust to the public, the Legislature has expressed a special interest in closely regulating certain contingent-fee contracts between governmental entities and private parties. For example, Section 6.30 of the Tax Code permits a taxing unit to "contract with any competent attorney to represent the unit to enforce the collection of delinquent taxes" provided that "[t]he attorney's compensation is set in the contract" and "does not exceed 20 percent of the amount of delinquent tax, penalty, and interest collected." A contract that does not conform to those requirements is void.
TEX. TAX CODE § 6.30(c).
Id. § 6.30(e).
In 1999, the Legislature also amended Chapter 2254, Subchapter C of the Government Code to add procedural safeguards for contingent-fee agreements between governmental entities and private parties with respect to legal services, excluding those contracts governed by Section 6.30 (among others). Since 2007, and at the time the Taxing Units engaged counsel in this matter, no "public agency"—as specially defined—could execute a legal-services contract on a contingent-fee basis absent the Comptroller's review and approval. In 2019, more than a year after the Taxing Units hired counsel in this case, the Legislature expanded and modified that prohibition by amending Subchapter C to require all political subdivisions to obtain the Attorney General's approval before a contingent-fee contract for legal services is effective and enforceable. At the same time, the Legislature added another provision providing that a contract violating Subchapter C "is void as against public policy, and no fees may be paid to any person under the contract or under any theory of recovery for work performed in connection with a void contract." This section of the Government Code also purports to insulate any contract approved by the Attorney General from later being declared void.
TEX. GOV'T CODE §§ 2254.101-.110.
See id. §§ 2254.101-.103, .106-.107.
Act of May 27, 2007, 80th Leg., R.S., ch. 937, § 3.07, 2007 Tex. Gen. Laws 3207, 3233, repealed by Act of May 20, 2019, 89th Leg., R.S., ch. 857, § 9, 2019 Tex. Gen. Laws 2321, 2321 ("A public agency as defined under Section 30.003(3), Water Code, may not enter into a contract as provided by Subchapter C, Chapter 2254, without review and approval by the comptroller."). For purposes of this prohibition, "public agency" was defined as "any district, city, or other political subdivision or agency of the state which has the power to own and operate waste collection, transportation, treatment, or disposal facilities or systems, and any joint board created under the provisions of Subchapter D or E, Chapter 22, Transportation Code." Id. (adopting the definition of "public agency" from Section 30.003(3) of the Water Code).
TEX. GOV'T CODE § 2254.1038. A "political subdivision" includes "a district, authority, county, municipality, or other political subdivision of the state[.]" Id. § 2254.101(2-a) (incorporating the definition from Section 2254.002(1)(B), (C), and (D)).
Id.
Id.
The Taxing Units take umbrage at the suggestion that a legal services contract to investigate the undervaluation of taxable property is properly characterized as a "tax ferret contract" because even though property undervalued due to taxpayer fraud might be considered "omitted" from the tax rolls, correcting an undervaluation is not the same as uncovering property that has been entirely overlooked by the taxing authorities. But the real nub of disagreement concerns the express or implied authority, and necessity of prior approval, to engage such services (however they are labeled) on a contingent-fee basis and the effect of any noncompliance with statutory requisites on the Taxing Units' ability to maintain the judicial-review suit. As to those matters, the Taxing Units assert, among other arguments, that the contracts are valid because (1) Section 6.30 expressly permits contingent-fee agreements to collect "delinquent taxes" without prior approval, and (2) the provisions in Chapter 2254 requiring political subdivisions to obtain approval for contingent-fee contracts are inapplicable because they were enacted after the attorney-employment contracts' effective dates. Even if some or all of the contingent-fee contracts are void, as Kinder Morgan asserts, the Taxing Units maintain that the only effect would be to deny counsel compensation under the contracts, not to prohibit counsel's continued representation under different compensation terms nor to invalidate actions taken in the scope of that representation.
Because this issue was raised for the first time on appeal, we consider only whether a jurisdictional impediment bars the Taxing Units' judicial-review suit. To that end, we need not determine whether counsel is a tax ferret, whether any or all of the contingent-fee contracts are void for want of Comptroller or Attorney General approval, or whether counsel is disqualified from continued representation on that basis or any other because even if the contracts are void, that circumstance alone does not nullify the Taxing Units' bona fide attempt to invoke the trial court's jurisdiction over their appeal from the ARB's order denying the challenge petitions. Accordingly, we assume, without deciding, that the Taxing Units engaged legal counsel under impermissible contingent-fee engagements.
See Bonsmara Nat. Beef Co., LLC v. Hart of Tex. Cattle Feeders, LLC, 603 S.W.3d 385, 391-93 (Tex. 2020) (addressing jurisdictional argument raised for the first time on appeal); Tex. Ass'n of Bus. v. Tex. Air Control Bd., 852 S.W.2d 440, 445 (Tex. 1993) (subject-matter jurisdiction may not be waived).
2. Defective But Not Void
The Tax Code entitles taxing units "to challenge before the appraisal review board . . . an exclusion of property from the appraisal records" and has been construed as "provid[ing] a remedy for an erroneous appraisal based on property that escaped taxation because of a void assessment arising from taxpayer fraud." A taxing unit is "entitled to appeal" the appraisal review board's order determining the challenge. Kinder Morgan does not challenge the Taxing Units' standing or competency to appeal. Nor does Kinder Morgan contend the petition for judicial review is invalid as a perfecting instrument for any other reason than in regard to the attorney's authority to sign and file it on the Taxing Units' behalf. Likewise, Kinder Morgan does not contend that the petition for judicial review was filed in anything other than a good-faith effort to perfect an appeal and invoke the trial court's jurisdiction.
Act of May 22, 1999, 76th Leg., R.S., ch. 631, § 7, 1999 Tex. Gen. Laws 3191, 3196 (amended 2019) (current version at TEX. TAX CODE § 41.03(a)(1)).
Willacy Cty. Appraisal Dist. v. Sebastian Cotton & Grain, Ltd., 555 S.W.3d 29, 50 (Tex. 2018) (quoting Beck & Masten Pontiac-GMC, Inc. v. Harris Cty. Appraisal Dist., 830 S.W.2d 291, 295 n.3 (Tex. App.—Houston [14th Dist.] 1992, writ denied), which interpreted TEX. TAX CODE § 25.21).
TEX. TAX CODE § 42.031(a) (emphasis added).
In Grand Prairie Independent School District v. Southern Parts Imports, Inc., we held that "a court of appeals may not dismiss an appeal when the appellant filed the wrong instrument required to perfect the appeal without giving the appellant an opportunity to correct the error." There, the appellant had filed a notice of appeal instead of an appeal bond. The court of appeals denied leave to file an appeal bond, as required to perfect the appeal, and dismissed the appeal for want of jurisdiction. We reversed and held that "[a] court of appeals has jurisdiction over any appeal where the appellant files an instrument that 'was filed in a bona fide attempt to invoke appellate court jurisdiction,'" and if a document filed under such circumstances is faulty, the appellate court must afford the appellant an opportunity to amend or refile any instrument required by the law or our rules to perfect the appeal. The critical inquiry in determining whether an appeal has been perfected is not whether there has been an error of form or substance but whether the instrument was filed in a good-faith attempt to appeal.
813 S.W.2d 499, 500 (Tex. 1991).
Id. at 499.
Id. at 499-500.
Id. at 500 (quoting Walker v. Blue Water Garden Apartments, 776 S.W.2d 578, 581 (Tex. 1989)).
Id.
See id.; Walker, 776 S.W.2d at 581; accord TEX. R. APP. P. 44.3 ("A court of appeals must not . . . dismiss an appeal for formal defects or irregularities in appellate procedure without allowing a reasonable time to correct or amend the defects or irregularities.").
Application of the foregoing principle to the circumstances here is consistent with case law recognizing that court documents filed by a nonlawyer on behalf of a litigant are considered to be "defective but not void, and may be effective for certain purposes[.]" For this reason, even if the Taxing Units' lawyer had no authority to act as their lawyer, the Taxing Units are not deprived of their statutory right to appeal by voidness of the legal-services engagement, if any. A bona fide effort to invoke the trial court's jurisdiction may be defective, but it is not void, and the proceedings cannot be dismissed without affording an opportunity to refile a proper instrument, if necessary.
Rabb Int'l, Inc. v. SHL Thai Food Serv., LLC, 346 S.W.3d 208, 210 (Tex. App.—Houston [14th Dist.] 2011, no pet.) (holding that motion for new trial filed by nonlawyer was not void and was effective to extend deadline to perfect an appeal); see, e.g., Kunstoplast of Am., Inc. v. Formosa Plastics Corp., USA, 937 S.W.2d 455, 456 (Tex. 1996) (holding that nonlawyer corporate officer could perform the ministerial duty of filing a bond necessary to perfect an appeal for a corporation, which must otherwise be represented by legal counsel); Guadalupe Econ. Servs. Corp. v. Dehoyos, 183 S.W.3d 712, 717 (Tex. App.—Austin 2005, no pet.) (holding that answer purportedly filed on behalf of corporation by a nonlawyer, though defective, still prevented the trial court from granting a default judgment).
Our conclusion that any lack of authority does not perforce invalidate the timely filed petition for judicial review comports with Texas Rule of Civil Procedure 12, which Kinder Morgan invoked to challenge the same counsel on the same basis in a different judicial-review proceeding. While Rule 12 requires the trial court to dismiss counsel who fails to show authority to prosecute or defend the proceeding, pleadings filed by any such counsel are not nullified and may only be stricken "if no person who is authorized to prosecute or defend appears."
See supra note 25.
See TEX. R. CIV. P. 12; see also City of San Antonio v. River City Cabaret, Ltd., 32 S.W.3d 291, 292-93 (Tex. App.—San Antonio, pet. denied) (holding trial court had no discretion to dismiss lawsuit once an authorized person appeared to prosecute the lawsuit, even though such authorization occurred after the lawsuit was filed and after the hearing on the Rule 12 motion).
Here, the Taxing Units have a statutory right to appeal the ARB's decision on their challenges and hired a licensed attorney to file the documents necessary to exercise their statutory right. Even assuming the attorney-employment contracts are void, deeming an otherwise timely and properly perfected appeal to be unperfected would elevate form over substance, contrary to the principles discussed above. If counsel is disqualified and if pleadings are stricken, consequences may ensue, and those consequences could have the same effect that Kinder Morgan seeks to achieve here. But there is a legally significant difference between a pleading that has been stricken and one that was void ab initio. The petition for judicial review filed on behalf of the Taxing Units to perfect their statutory right to appeal is not void, and to the extent it is properly characterized as defective, the appeal could not be dismissed without affording the Taxing Units a reasonable opportunity to refile the necessary perfecting instrument.
See Walker, 776 S.W.2d at 581.
Our holding today is without comment on, and without prejudice to, Kinder Morgan's right to invoke Rule 12 or pursue other disqualification proceedings in the trial court and the Taxing Units' right to pursue any viable defenses.
Finding no jurisdictional impediment to reaching the merits of this appeal, we turn now to the issue decided by the courts below: whether Kinder Morgan's TCPA motion to dismiss was timely filed.
B. TCPA Motion to Dismiss
The TCPA's purpose is to safeguard "the constitutional rights of persons to petition, speak freely, associate freely, and otherwise participate in government to the maximum extent permitted by law" without impairing a person's right "to file meritorious lawsuits for demonstrable injury." Among the balancing measures the Act employs is a deadline for seeking dismissal under the statute. Absent an extension, a TCPA motion must be filed within sixty days after service of a "legal action" that "is based on, relates to, or is in response to a party's exercise of the right of free speech, right to petition, or right of association[.]" In the applicable version of the statute, a "legal action" is broadly defined as "a lawsuit, cause of action, petition, complaint, cross-claim, or counterclaim or any other judicial pleading or filing that requests legal or equitable relief." The issue in this case is whether the Taxing Units' original petition for judicial review pleaded a "legal action" that triggered the TCPA's sixty-day filing window with respect to the subsequently pleaded taxpayer-fraud allegations or whether the assertion of those allegations in an amended petition restarted the clock. Kinder Morgan contends the second amended petition asserted a new legal action by adding a new "cause of action." The TCPA does not define the term "cause of action," but "the generally accepted meaning of that phrase refers to the 'fact or facts entitling one to institute and maintain an action, which must be alleged and proved in order to obtain relief.'"
TEX. CIV. PRAC. & REM. CODE § 27.002.
Under the prior version of the statute, only the trial court could grant an extension and only based on good cause. Act of May 18, 2011, 82d Leg., R.S., ch. 341, § 2, 2011 Tex. Gen. Laws 961, 962 (amended 2019) (current version at TEX. CIV. PRAC. & REM. CODE § 27.003(b)). Now, the parties may also agree to an extension. TEX. CIV. PRAC. & REM. CODE § 27.003(b).
Act of May 18, 2011, 82d Leg., R.S., ch. 341, § 2, 2011 Tex. Gen. Laws 961, 962 (amended 2019) (current version at TEX. CIV. PRAC. & REM. CODE § 27.003(a), (b)). As currently enacted, the phrase "relates to" is no longer part of the statutory standard, but now, a motion may also be filed if a legal action "arises from any act of that party in furtherance of the party's communication or conduct described by Section 27.010(b)." TEX. CIV. PRAC. & REM. CODE § 27.003(a).
Act of May 18, 2011, 82d Leg., R.S., ch. 341, § 2, 2011 Tex. Gen. Laws 961, 962 (amended 2019) (current version at TEX. CIV. PRAC. & REM. CODE § 27.001(6)). The current version of the statute includes requests for "declaratory[] or equitable relief" but excludes other specific types of matters from the term, including alternative-dispute-resolution proceedings and post-judgment enforcement actions. TEX. CIV. PRAC. & REM. CODE § 27.001(6).
See, e.g., Laoisiga v. Cerda, 379 S.W.3d 248, 255 (Tex. 2012) (quoting In re Jorden, 249 S.W.3d 416, 421 (Tex. 2008) (orig. proceeding)).
In our contemporaneously issued opinion in Montelongo v. Abrea, we examine a TCPA case involving an amended petition that added new legal claims based on the same essential facts that had been alleged in the original petition. This case presents the inverse scenario—an amended petition that added new factual allegations to support a previously asserted legal claim under the Tax Code—but Montelongo is nonetheless instructive here. In answering whether, and under what circumstances, an amended or supplemental pleading restarts the sixty-day period for filing a TCPA dismissal motion, Montelongo explains that
___ S.W.3d ___, ___ (Tex. 2021) [Cause No. 19-1112, slip op at 1-2].
an amended or supplemental pleading that asserts the same legal claims or theories by and against the same parties and based on the same essential facts alleged in a prior pleading asserts the same 'legal action' to which the sixty-day period previously applied and thus does not trigger a new sixty-day period for filing a dismissal motion.
But if an amended or supplemental pleading
(1) adds a new party or parties, (2) alleges new essential facts to support previously asserted claims, or (3) asserts new legal claims or theories involving different elements than the claims or theories previously asserted, the new pleading asserts a new legal action and triggers a new sixty-day period
as to those new parties,
facts,
or claims.
Id. at ___ [slip op at 2].
Id. (emphasis added).
Applying Montelongo here yields the conclusion that a new sixty-day window commenced from the addition of facts alleging taxpayer-fraud because the original petition did not put Kinder Morgan on notice that the Taxing Units were implicating Kinder Morgan in wrongdoing with respect to the reappraisal claim. The factual allegations of taxpayer fraud added in the second amended petition are "new essential facts" to support the claim of "erroneous[] and incorrect[]" omission of property asserted in the original petition.
Taxable property that is considered omitted ab initio from the taxing rolls due to taxpayer fraud is an alternative theory that could support the reappraisal request the Taxing Units seek. But, as the court of appeals acknowledged, it is not the only theory. More significantly, charging the taxpayer with "knowingly and purposefully provid[ing] inaccurate and/or incomplete information to be relied upon by [the county's appraiser] in an effort to evade payment of taxes" is not a subset of essential factual allegations in the original petition because the original petition contains no essential factual allegations at all to support the reappraisal claim. Rather, the petition asserts a broad claim for reappraisal without any of the facts that must be alleged or proved to obtain relief. The original petition did not fairly plead a cause of action for reappraisal based on taxpayer fraud.
A cause of action is sufficiently pleaded only if the petition gives fair notice of the claim involved. "The key inquiry is whether the opposing party 'can ascertain from the pleading the nature and basic issues of the controversy and what testimony will be relevant.'" Our notice-pleading rules require pleadings to not only give notice "of the claim and the relief sought" but also of the essential factual allegations. "The purpose of this rule is to give the opposing party information sufficient to enable him to prepare a defense." To paraphrase from Montelongo, providing only fair notice of claims does not provide fair notice of the essential factual allegations supporting those claims.
TEX. R. CIV. P. 47(a); DeRoeck v. DHM Ventures, LLC, 556 S.W.3d 831, 835 (Tex. 2018).
DeRoeck, 556 S.W.3d at 835 (quoting Horizon/CMS Healthcare Corp. v. Auld, 34 S.W.3d 887, 896 (Tex. 2000)).
___ S.W.3d ___, ___ (Tex. 2021) [Cause No. 19-1112, slip op at 12] (quoting TEX. R. CIV. P. 47(a), In re Lipskey, 460 S.W.3d 579, 590 (Tex. 2015) (orig. proceeding), and Auld, 34 S.W.3d at 896). Our rules of civil procedure state that "[a]n original pleading which sets forth a claim for relief . . . shall contain . . . a short statement of the cause of action sufficient to give fair notice of the claim involved." TEX. R. CIV. P. 47(a) (emphases added). As we have explained many times, a "cause of action" means the "fact or facts entitling one to institute and maintain an action, which must be alleged and proved in order to obtain relief." E.g., Laoisiga v. Cerda, 379 S.W.3d 248, 255 (Tex. 2012) (quoting In re Jorden, 249 S.W.3d 416, 421 (Tex. 2008) (orig. proceeding)).
Roark v. Allen, 633 S.W.2d 804, 810 (Tex. 1982).
___ S.W.3d ___, ___ (Tex. 2021) [Cause No. 19-1112, slip op at 12].
The original petition for judicial review pleaded that:
[M]ineral interest real property of the Kinder Morgan Entities in Scurry County was erroneously and incorrectly omitted from appraisal for years 2018, and 2013-2017 and [] accurate values should be determined by [the trial court].
Beck & Masten Pontiac-GMC,
Inc.
v.
Harris Co.
Appraisal Dist.,
830 S.W.2d 291, 294-95 (Tex. App.—Houston [14th Dist.] 1992, writ denied)[.]
[] The Taxing Units also assert that re-appraisal for year 2018 and back-appraisal for years 2013-2017 is required of the Scurry County Appraisal District as to the mineral interest real property of the Kinder Morgan Entities in Scurry County. Atascosa Co. v. Atascosa Co. Appraisal Dist., 990 S.W.2d 255, 257 (Tex. 1999); In re ExxonMobil Corp., 153 S.W.3d 605, 619 (Tex. App.—Amarillo 2004 [sic]); Tex. Tax Code Ch. 25, 41.
. . . .
The omission of properties, in toto or ab initio, was brought to the attention and knowledge of the Chief Appraiser of the Scurry County Appraisal District as to the mineral interest real property of the Kinder Morgan Entities in Scurry County for the time period 2013-2018. Despite having a mandatory and ministerial duty to re-appraise [sic] and back-appraise the mineral interest real property, the Chief Appraiser and the Scurry County Appraisal District have failed to take such action.
Noticeably absent are any allegations with respect to Kinder Morgan other than its identification as the property owner—a fact that makes it an essential party to the proceeding but does not inform the factual basis supporting the reappraisal claim. The petition includes no allegations that the alleged tax deficiency resulted from
any conduct on Kinder Morgan's part, let alone that any rights protected by the TCPA might be implicated.
Just as essential factual allegations may give rise to a variety of different legal theories, legal theories may be supported by a variety of different
factual scenarios. The pleading of a legal theory, without more, does not provide notice of the facts that could be pleaded to support that theory. For that reason, we cannot agree with the court of appeals that a theory of taxpayer fraud being a subset of potential omission claims satisfied the notice-pleading rules and, therefore, we cannot agree that the amended pleading added no new essential facts.
See Fairdale Ltd. v. Sellers, 651 S.W.2d 725, 726 (Tex. 1982) ("The petition does not allege that Sellers contracted with Fairdale, that Fairdale built the townhome, that Fairdale provided or installed the cabinets, that Fairdale was responsible for the hidden or latent defects, or that Fairdale warranted the cabinets. In fact, there is no allegation in the petition of any duty owed by Fairdale to Sellers or an allegation of a breach of any duty. Therefore, the petition does not state a cause of action against Fairdale.").
Nor is it sufficient, as the Taxing Units suggest, that Kinder Morgan could (or should) have deduced from extrinsic sources that the Taxing Units were pursuing reappraisal based on Kinder Morgan's alleged fraud in its communications with the appraisal district. The original petition cites Beck & Masten, Exxon Mobile, and Atascosa without elaboration. Beck & Masten allowed the appraisal district to reappraise omitted property due to fraud committed by the property owner. In ExxonMobil, the court of appeals required local taxing units to pursue allegations of taxpayer fraud before the appraisal review board rather than as common-law fraud claims in the district court because the review board had exclusive original jurisdiction over the taxing authorities' valuation claims and "failing a satisfactory result at the appraisal review board, de novo judicial review [is] available." Atascosa stands for the proposition that property omitted due to the appraiser's error of classifying it as exempt can be back-appraised for the five previous years.
See Beck & Masten Pontiac-GMC, Inc. v. Harris Cty. Appraisal Dist., 830 S.W.2d 291, 295 (Tex. App.—Houston [14th Dist.] 1992, writ denied).
In re ExxonMobil Corp., 153 S.W.3d 605, 614, 618 (Tex. App.—Amarillo 2004, orig. proceeding).
Atascosa County v. Atascosa Cty. Appraisal Dist., 990 S.W.2d 255, 260 (Tex. 1999).
Both Beck & Masten and ExxonMobil involve a taxing unit's claim for back-appraisal based on a taxpayer's alleged misrepresentations. But the citation of these cases does not equate to fair notice of the essential factual allegations giving rise to a claim for relief because, as we have held,
[i]n determining whether a cause of action was pled, plaintiff's pleadings must be adequate for the court to be able,
from an examination of the plaintiff's pleadings alone , to ascertain with reasonable certainty and without resorting to
information aliunde[
] the elements of plaintiff's cause of action and the relief sought with sufficient information upon which to base a judgment.
Aliunde, BLACK'S LAW DICTIONARY (11th ed. 2019) ("From another source; from elsewhere[.]").
Stoner v. Thompson, 578 S.W.2d 679, 683 (Tex. 1979) (emphases added); see Fairdale, 651 S.W.2d at 725 ("In determining [whether] a cause of action has been pleaded, the court must be able to determine from the pleadings alone the elements of the cause of action and the relief sought with reasonable certainty and without resorting to other sources." (emphasis added)).
The Taxing Units' original petition fails to give Kinder Morgan fair notice of the essential facts supporting an allegation that the alleged omission resulted from Kinder Morgan's conduct. Based on the allegations in the original petition alone, Kinder Morgan could not have ascertained that the basic issue of the controversy was its alleged misrepresentations to SCAD's appraiser. The court of appeals and trial court therefore erred in holding that Kinder Morgan's TCPA motion to dismiss, which was filed within sixty days after service of a legal action asserting new essential facts, was untimely.
See DeRoeck v. DHM Ventures, LLC, 556 S.W.3d 831, 835 (Tex. 2018) (quoting Horizon/CMS Healthcare Corp. v. Auld, 34 S.W.3d 887, 896 (Tex. 2000)). --------
III. Conclusion
We hold that Kinder Morgan's TCPA motion to dismiss was timely filed. Accordingly, we reverse the court of appeals' judgment and remand to the trial court without reaching Kinder Morgan's alternative argument that good cause exists for an extension. Our conclusion that Kinder Morgan satisfied the TCPA's timeliness requirement should not be construed as a comment on the TCPA's applicability to the legal action. That issue was not presented on appeal and remains to be determined.
/s/_________
Eva M. Guzman
Justice OPINION DELIVERED: April 30, 2021