law-standing-doctrine

law-standing (doctrine)

TEXAS SUPREME COURT CASES

The Standing Doctrine in the Texas Supreme Court (Tex 2008)

Frymire Engineering Co. v. Jomar International, No. 06-0755 (Tex. June 13, 2008)(Willett)(indemnity,
equitable subrogation standing, construction law)
FRYMIRE ENGINEERING COMPANY, INC. BY AND THROUGH REAL PARTY IN INTEREST, LIBERTY
MUTUAL INSURANCE COMPANY v. JOMAR INTERNATIONAL, LTD. AND MIXER S.R.L.; from Dallas
County; 5th district (05-04-01717-CV, 194 SW3d 713, 05-30-06)
The Court reverses the court of appeals' judgment and remands the case to that court.
Justice Don R. Willett delivered the opinion of the Court.

Daimler Chrysler Corp. v. Inman, No. 03-1189 (Tex. Feb. 1, 2008)(Opinion by Justice Nathan Hecht)
(consumer law, product liability, class action dismissed on standing grounds, jurisdictional dismissal,
DWOJ)
DAIMLERCHRYSLER CORPORATION v. BILL INMAN, DAVID CASTRO, AND JOHN WILKINS, EACH
INDIVIDUALLY AND ON BEHALF OF ALL OTHERS SIMILARLY SITUATED; from Nueces County; 13th
district (13-02-00415-CV, 121 S.W.3d 862, 11/20/03)
The Court reverses the court of appeals' judgment and dismisses the case for want of jurisdiction.
Justice Hecht delivered the opinion of the Court, in which Justice Wainwright, Justice Brister, Justice
Medina, and Justice Willett joined.
Chief Justice Wallace Jefferson delivered a dissenting opinion, in which Justice Harriet O'Neill, Justice
Paul Green, and Justice Phil Johnson joined.

TEXAS COURTS OF APPEALS CASES

08-0640
R2 ENTERPRISES, INC. AND TED REEVES v. VERNON WHIPPLE; from Denton County; 2nd district
(02-07-00257-CV, ___ SW3d ___, 06-26-08, pet. denied Sep 2008)(JNOV, partnership dispute, no
standing)
This case involves a dispute between one of the limited partners of a limited partnership and the other
limited partner and the general partner of the limited partnership.
As the party with the primary legal right to recover, Rivendell is the exclusive party with a justiciable
interest; therefore, Reeves and R2 Enterprises did not have standing to recover the future damages
awarded by the jury, and the trial court did not err by granting the JNOV and entering a take nothing
judgment in Whipple=s favor

08-0406
HENRY MELVYN RICHARDSON, STEPHANY HARRIS, KLAREE BOOSE, SARAH, KEELI, IVY, SHEBA,
DARRELL, HARPER, EMMA, RAIN, AND ULYSSES v. PRIMARILY PRIMATES, INC.; from Bexar County;
4th district (04-06-00868-CV, ___ SW3d ___, 01-16-08, pet. denied)(animal law, standing to sue)

08-0095
FINLEY OIL WELL SERVICE, INC. v. RETAMCO OPERATING, INC.; from Bexar County; 4th district
(04-06-00346-CV, 248 SW3d 314, 10-17-07, pet. denied Jun 2008) (sanctions, standing, unliquidated
damages)

07-0588
NACOGDOCHES COUNTY HOSPITAL DISTRICT, D/B/A NACOGDOCHES MEMORIAL HOSPITAL v.
CHARLES RAY NEWMAN AND JIMMY WAYNE CURTIS; from Nacogdoches County; 12th district
(12-06-00375-CV, ___ S.W.3d ___, 05-23-07, pet. denied)(District lacked standing to bring suit against
Newman under Chapter 55 and a suit to enforce a Chapter 55 lien was not ripe)

07-0148 AIRCRAFT NETWORK, LLC v. ASSOCIATED AVIATION UNDERWRITERS, INC. AND CESSNA
AIRCRAFT COMPANY; from Dallas County; 5th district (05-04-01056-CV, 213 SW3d 455, 11-29-06,
pet. denied March 2008) (breach of bailment agreement, no standing) We sustain AAU's first point of
error and hold that Aircraft Network lacked standing to sue AAU.

Standing to Sue AAU

Initially, we address AAU's assertion that Aircraft Network lacks standing to sue AAU because a third-
party claimant cannot sue an insurer.
Potential conflicts arise with respect to an insurer's duty to its insured when a third-party sues the
insurer directly. The supreme court has addressed these concerns when considering whether a third-
party claimant has standing to sue an insurer. See Transport Ins. Co. v. Faircloth, 898 S.W.2d 269 (Tex.
1995); Allstate Ins. Co. v. Watson, 876 S.W.2d 145 (Tex. 1994). In Faircloth, a woman was killed in a car
accident involving Allied Van Lines. Allied's insurer, Transport Insurance Company, entered into a
$250,000 settlement agreement with Paula Faircloth, a minor thought to be the daughter of the
deceased. Upon reaching the age of majority, Faircloth sued Transport for unfair settlement practices.
The supreme court held that third-party claimants lack standing to sue an insurer for a claim for breach
of the duty of good faith and fair dealing. Id. at 279. The supreme court noted that the insured's
interests are adverse to those of a third-party claimant. If an insurer owes duties to a third-party, the
insurer's duties to its insured would necessarily be compromised. Id.
Watson also involved a car accident. Watson sued Allstate, the other driver's insurer, alleging claims for
unfair settlement practices under the insurance code. Watson, 876 S.W.2d at 146. The supreme court
held that a third-party claimant cannot sue an insurer for unfair settlement practices under the insurance
code. Id. at 149. In so holding, the supreme court explained that allowing a third-party claimant to sue
insurers would undermine the duties that insurers owe to their insureds. “An insurance company owes to
its insured a duty to defend against the claims asserted by a third party.” Id. at 150 (emphasis in
original).
Aircraft Network relies primarily on one case to support its contention that it does have standing to sue
AAU. See Webb v. International Trucking Co., Inc., 909 S.W.2d 220 (Tex. App.-San Antonio 1995, no
writ). Webb involved an accident between two truck drivers. One truck was owned by International
Trucking (Trucking). The other truck involved in the accident was owned by Williams Drilling Company
(Williams). Prior to liability being determined, the adjuster for Williams's insurer told Trucking that the
insurer would pay for the damages to its truck and instructed Trucking to have it repaired at a certain
service facility. Id. at 223. Relying on the insurer's statement, Trucking had its truck repaired.
Subsequently, the insurer determined that its driver was not at fault and, therefore, refused to pay
Trucking's repair bill. Trucking sued the insurer for DTPA and insurance code violations. Summary
judgment was granted on the insurance code violations and the jury found in favor of Trucking on the
DTPA claims. Id. at 224.
On appeal, the insurer asserted that Trucking, a third-party claimant, lacked standing to sue it. The
court of appeals distinguished Watson and Faircloth on the ground that the claims in both of those
cases were based on unfair claim settlement practices. Id. at 224-25. Significantly, the facts giving rise
to the claims in Webb occurred prior to liability being either determined or reasonably clear and,
therefore, outside the context of settlement negotiations. An insurer does not settle a claim for which its
insured is not liable. An insurer engages in settlement practices at the point that liability is determined or
becomes reasonably clear.
In our case, liability was determined at the point of the accident. Cessna admitted its fault and never
wavered from that position. Responsibility for the accident was never an issue. From the beginning, AAU
was trying to settle a claim for which Cessna, its insured, was liable. In an effort to fit this case into the
Webb analysis, Aircraft Network couches its claims as a separate agreement between itself and AAU
outside the context of any settlement negotiations. The facts, however, are against such assertion.
Aircraft Network's claims arose from AAU's attempts to settle those claims on behalf of Cessna, AAU's
insured. Loss of use was one of the claims AAU was attempting to settle. Aircraft Network and AAU did
not reach an agreement on the loss of use claim during the negotiation process.   See Footnote 2
We hold that, under these circumstances, Aircraft Network lacked standing to sue AAU. Accordingly, we
sustain AAU's first point of error. We reverse the trial court's judgment with respect to AAU and render
judgment that Aircraft Network take nothing on its claims against AAU.

07-0993 OAIC COMMERICAL ASSETS, LLC v. STONEGATE VILLAGE, LP AND CAWC FINANCIAL,
INC.; from Dallas County; 5th district (05-05-01471-CV, 234 SW3d 726, 08-16-07, pet. denied March
2008) (partnership dispute, standing)

III. DETERMINATION OF STANDING

Because the determination of OAIC's issues is dependent on our resolution of appellees' first cross-
point respecting whether OAIC has standing to bring its claims, we address that cross-point at the outset.
A. Standard of Review

Standing, a necessary component of subject-matter jurisdiction, is a constitutional prerequisite to
maintaining a suit under Texas law. Tex. Ass'n of Bus. v. Tex. Air Control Bd., 852 S.W.2d 440, 444
(Tex. 1993). As a necessary component of a court's subject-matter jurisdiction, standing cannot be
waived and can be raised for the first time on appeal. Id. at 445-46. Appellate courts are obligated to
review sua sponte issues affecting jurisdiction. M.O. Dental Lab v. Rape, 139 S.W.3d 671, 673 (Tex.
2004). See also Bowles v. Wade, 913 S.W.2d 644, 647 (Tex. App.-Dallas 1995, writ denied); Centurion
Planning Corp., Inc. v. Seabrook Venture II, 176 S.W.3d 498, 508 (Tex. App.-Houston [1st Dist.] 2004,
no pet.).
Whether a trial court has subject-matter jurisdiction is a question of law that is reviewed de novo. See
Mayhew v. Town of Sunnyvale, 964 S.W.2d 922, 928 (Tex. 1998). To have standing, the pleader bears
the burden of alleging facts that affirmatively demonstrate the court's jurisdiction to hear the cause. Tex.
Air Control Bd., 852 S.W.2d at 446. We review the pleadings and the entire record to determine if there
is evidence establishing subject-matter jurisdiction. Dallas County Appraisal Dist. v. Funds Recovery,
887 S.W.2d 465, 469 (Tex. App.-Dallas 1994, writ denied).
In an appeal from a bench trial, findings of fact carry the same weight as a jury verdict. Walker v. Cotter
Prop., Inc., 181 S.W.3d 895, 899 (Tex. App.-Dallas 2006, no pet.). Unchallenged findings of fact are
conclusive on appeal unless the contrary is established as a matter or law or there is no evidence to
support the findings. Toles v. Toles, 45 S.W.3d 252, 265 n.6 (Tex. App.-Dallas 2001, pet. denied) (citing
McGalliard v. Kuhlmann, 722 S.W.2d 694, 696 (Tex. 1986)). Where an appellant attacks the trial court's
findings of fact on legal or factual sufficiency grounds, the applicable standard of review is the same as
that to be applied in the review of jury findings. Walker, 181 S.W.3d at 899. In evaluating the legal
sufficiency of the evidence to support a finding, we must determine whether the evidence as a whole
rises to a level that would enable reasonable and fair-minded people to differ in their conclusions.
Columbia Med. Ctr. Subsidiary, L.P. v. Meier, 198 S.W.3d 408, 414 (Tex. App.-Dallas 2006, pet. denied)
(citing City of Keller v. Wilson, 168 S.W.3d 802, 822 (Tex. 2005)). Anything more than a scintilla of
evidence is legally sufficient to support a challenged finding. Walker, 181 S.W.3d at 899. More than a
scintilla of evidence exists if the evidence furnishes some reasonable basis for differing conclusions by
reasonable minds about the existence of some vital fact. Id.
We review the trial court's conclusions of law de novo to determine whether they are correct. See
McIntyre v. Comm'n for Lawyer Discipline, 169 S.W.3d 803, 806 (Tex.App.-Dallas 2005, pet. denied);
Travelers Indem. Co. of Rhode Island v. Starkey, 157 S.W.3d 899, 906 (Tex. App.-Dallas 2005, pet.
denied). Conclusions of law must be upheld on appeal if any legal theory supported by the evidence
sustains the judgment, and will be reversed only if the conclusions are erroneous as a matter of law.
See McIntyre, 169 S.W.3d at 807.

B. Applicable Law

1. Standing, Generally

In Texas, the standing doctrine requires that (1) there be “a real controversy between the parties,” and
(2) that real controversy “will be actually determined by the judicial declaration sought.” Nootsie, Ltd. v.
Williamson County Appraisal Dist., 925 S.W.2d 659, 662 (Tex. 1996) (quoting Tex. Air Control Bd., 852
S.W.2d at 446). “The issue of standing focuses on whether a party has a sufficient relationship with the
lawsuit so as to have a 'justiciable interest' in its outcome.” Austin Nursing Ctr. v. Lovato, 171 S.W.3d
845, 848 (Tex. 2005) (quoting 6A Charles Alan Wright, Arthur R. Miller, and Mary Kay Kane, Wright,
Miller & Kane, Federal Practice and Procedure: Civil 2d § 1559, 441 (2d ed. 1990)). “The determination
of whether a plaintiff possesses standing to assert a particular claim depends on the facts pleaded and
the cause of action asserted.” Everett v. TK-Taito, L.L.C., 178 S.W.3d 844, 853 (Tex. App.-Fort Worth
2005, no pet.). See also M.D. Anderson Cancer Ctr. v. Novak, 52 S.W.3d 704, 707-08 (Tex. 2001)
(analyzing standing in the context of asserted claim).
When standing has been statutorily conferred, the statute itself serves as the proper framework for a
standing analysis. Everett, 178 S.W.3d at 851. The plaintiff must allege and show how he has been
injured or wronged within the parameters of the language used in the statute. Id.

2. Construction of the Agreement

The agreement provides that “[t]he laws of the State of Georgia (without regard to its conflicts of law
principles) and any applicable Federal Laws shall govern the validity of this Agreement, the construction
of its terms, the interpretation of the rights and duties of the Partners and any claims, counterclaims or
any other matters relating hereto or in connection herewith (whether based on contract, tort or
otherwise).” Georgia law provides that construction of a contract, at the outset, is a question of law. RLI
Ins. v. Highlands on Ponce, LLC, 635 S.E.2d 168, 171 (Ga. Ct. App. 2006); Woody's Steaks, LLC v.
Pastoria, 584 S.E.2d 41, 43 (Ga. Ct. App. 2003). If the language of a contract is unambiguous, the court
simply enforces the contract according to its clear terms, and looks to the contract alone for meaning.
RLI, 635 S.E.2d at 171; Caswell v. Anderson, 527 S.E.2d 582, 582 (Ga. Ct. App. 2000). “Ambiguity” is
defined as duplicity, indistinctness, or an uncertainty of meaning or expression. RLI, 635 S.E.2d at 171.

07-0042 JULIE HOBBS v. KATHLEEN VAN STAVERN; from Galveston County; 1st district
(01-05-00632-CV, ___ SW3d ___, 11-02-06, pet. denied Feb 2008)(family law, SAPCR, same sex
relationship, adoption, standing as (non) parent)

07-0990
LUBRICANTS USA, LP., LUBRICANTS MANAGEMENT GROUP, LP., APL MANAGEMENT, LLC, CHRIS
HAIRE, AND ROBERT BLAKE SHAW v. GREGORY A. BIRD AND MICHAEL G. RADLER; from Tarrant
County; 2nd district (02-06-00061-CV, ___ SW3d ___, 08-31-07, pet. denied Jan 2008) (partnership
law, standing)
we hold that the trial court erred by granting appellees' plea to the jurisdiction and dismissing appellants'
claims based on lack of standing