Prerequisites of Declaratory Relief
In Texas Will Contest Cases.
This is part 1 of 2 about the prerequisites needed for declaratory relief in Texas will contest cases. Before a Texas probate attorney can request a declaratory judgment six prerequisites need to be met.
Justiciable Controversy and Standing
As both the history of declaratory judgments and the current statutory scheme reveals, advisory opinions are not permissible or available to probate attorneys in San Antonio, South Texas, Central Texas, or beyond.
“[Probate] courts may not review hypothetical or contingent situations, or determine questions not currently essential to the decision of an actual, existing dispute.”
Foust v. Ranger Ins. Co., 975 S.W.2d 329, 331 (Tex. App. – San Antonio 1998, pet. denied)
Attempts to secure declarations concerning issues that might arise are improper. Artful pleading, or framing the issue, by probate attorneys in Texas will contest cases is an important consideration at this stage when considering a request for declaratory relief. If a client is concerned about an issue that is serious enough to warrant the filing of a lawsuit, then logically there should exist the proverbial “justiciable controversy” that is more than simply a hypothetical situation. Texas trust and estate attorneys must keep this in mind.
More often, although certainly not always, a request for the probate court to determine a hypothetical issue is likely to be argued in situations where one party is attempting to leverage a claim for declaratory relief solely to secure attorneys’ fees, and in doing so was forced to leverage their credibility beyond the bounds of proper judgment.
The Declaratory Judgments Act is “not available to settle disputes already pending before a court.”1 In other words, a party cannot simply counterclaim for a declaration concerning an existing claim.
How to Establish a Standing
To establish standing under the Uniform Declaratory Judgments Act, a party, even one involved in a will contest case with a probate attorney, must show a particularized, legally protected interest that is actually or imminently affected by the alleged harm.
In a recent Texas Supreme Court decision on this matter, the court wrote that “[t]o constitute a justiciable controversy, there must exist a real and substantial controversy involving a genuine conflict of tangible interests and not merely a theoretical dispute.”2 In the case, a bank was attempting to offset a Texas money judgment against it with a domesticated judgment against its judgment creditor and sought a declaration from the court as to whether it had a right to such offset.
The Texas Supreme Court continued that “[t]he authority to grant a declaratory judgment like the one sought in this case flows from the ‘general powers’ of the courts to enter a declaratory judgment given under the Declaratory Judgments Act. . . . A trial court has the discretion to enter a declaratory judgment so long as it will serve a useful purpose or will terminate the controversy between the parties.”3
There must exist a real controversy, to be resolved by the declaration requested, such that a justiciable controversy and standing is presented. As a South Texas trust and estate lawyer, these are issues to which we pay close attention.
Parties in Declaratory Relief
When declaratory relief is sought, all persons who have or claim any interest that would be affected by the declaration must typically be made parties. Obviously, a declaration does not prejudice the rights of a person not a party to the proceeding.4 A court’s declaration does not prejudice non-parties, and in some occasions, parties are not necessarily required to be joined.
For instance, in an action between partner and trustee partner concerning a settlement agreement, the partnership was not considered necessary, but its interest was not prejudiced (and it was not bound) by the judgment.5 At least one court has held that a court has the discretion to proceed in the absence of one or more potential parties.6 Generally, it is good practice to join all parties where feasible.
Parties in a Will Contest Case
In a Texas will construction or will contest case, the probate lawyer handling the case must join all devisees of the will, who are considered necessary parties to a declaratory action.7
The rules vary somewhat when the will in question concerns a minor. There, parties should give careful consideration to appointing a representative for the minor by order. Where the record did not contain an order appointing executor either as next friend or guardian of minor, appellate courts have ruled that devisees failed to establish that minors were joined as parties in a declaratory judgment action seeking judgment construing a will, even though the minor’s father was the estate’s independent executor and was served.
The appellate court made this ruling because the record did not contain an order appointing executor either as next friend or guardian ad litem of minor. Simply having filed an application identifying executor as next friend and guardian ad litem of minor was insufficient to establish that the executor appeared as next friend of minor.8
Mandatory Joinder Rule
The mandatory versus permissive joinder of all persons needed for just adjudication in the context of declaratory judgments tracks the language of the Texas Rules of Civil Procedure 39 and 40. Rule 39 (mandatory joinder rule) provides that a person shall be joined as a party if “in his absence complete relief cannot be accorded among those already parties or he claims an interest relating to the subject of the action and is so situated that the disposition of the action in his absence may” impact his ability to protect his interest.9 The permissive joinder rule provides that a party may join those who assert an interest jointly in the subject of the litigation.10
Pendency of a Valid Question in a Texas Will Contest
The ability to obtain an instruction or declaration from the probate court, whether during a Texas will contest, or a trust or estate matter, does require the pendency of a valid question. The statute provides guidance on questions to be considered by probate attorneys:
“A court of record within its jurisdiction has power to declare rights, status, and other legal relations whether or not further relief is or could be claimed”
Tex. Civ. Prac. & Rem. Code § 37.003(a)
“A person interested under a deed, will, written contract, or other writings constituting a contract or whose rights, status, or other legal relations are affected by a statute [or contract] may have determined any question of construction or validity . . . .”
Tex. Civ. Prac. & Rem. Code § 37.004(a)
Within the context of a trust or estate, by way of example and not of limitation, a Texas probate lawyer may seek declaration of the validity of a statute11, construction or validity of deeds or other documents of real estate title12, clarification of ownership of minerals13, validity of restrictive covenants14, validity of leases15, and contractual liability.16 The subject matter of declaratory relief that can be requested in the probate courts is extremely broad.
Declaratory Judgment vs Trespass
Much confusion by San Antonio probate attorneys arises from the use of declaratory judgments versus trespass to try title in a real estate context.
Through a request for declaratory relief, a party may request a court to clarify or determine the validity of, title documents. On the other hand, a trespass to try title suit is “the method of determining title to lands, tenements, and other real property.”17
As previously referenced, the Texas Declaratory Judgments Act provides that “an interested person may have determined any question of construction or validity arising under the instrument [or] contract . . . and obtain a declaration of rights, status, or other legal relations thereunder.”18 When a suit does not involve the construction or validity of deeds or other documents of title, the suit is not one for declaratory judgment.19 A suit involving a title dispute between competing deeds is a trespass to try title case. If the question involves the construction or validity of the deeds, it is an action for declaratory judgment.
Requests for a declaration by Texas estate lawyers cannot, generally, be the subject matter of an existing cause of action. Some appellate decisions, however, have “split hairs” in making this determination. For example, consider the following paragraph from the Houston Court of Appeals:
“[W]e find no merit in [trustee]’s argument that the judgment against him for conversion constitutes a collateral attack on matters decided under the declaratory judgment action [terminating the trust]. The court order relied on by [trustee] for this argument merely recites that the inter vivos trust “was terminated”; it does not, as Adam urges, include a finding that the trust terminated on the date the order was signed. This order does not preclude an action for conversion and is, instead, consistent with it. . . . In a related point, [the trustee] argues that requiring him to return the $750.00 he was permitted to segregate from the trust funds when they were deposited with the court is an impermissible collateral attack on the earlier order. We do not agree. Permission to retain control of that money was not an award of it.”
Adam v. Harris, 564 S.W.2d 152, 155 (Tex. Civ. App. – Houston [14th Dist.] 1978, writ refused n.r.e.)
In other words, the Court was careful to consider that the trial court’s order lacked a judgment declaring when the trust at issue had terminated, and this omission had a trickle-down effect. While an older case, it demonstrates the need for precision and detail when crafting declaratory orders so as to ensure that a valid question has been presented to the trial court.
1 BHP Petroleum Co. Inc. v. Millard, 800 S.W.2d 838, 841 (Tex. 1990).
2 Bonham State Bank v. Beadle, 907 S.W.2d 465, 467 (Tex. 1995).
3 Id. at 468.
4 Tex. Civ. Prac. & Rem. Code 37.006(a).
5 MacFarlane v. Rickard, 03-01-00507-CV, 2002 WL 1728608 (Tex. App. – Austin July 26, 2002, no pet.)(not designated for publication).
6 City of Corpus Christi v. Coleman, 262 S.W.2d 790 (Tex. Civ. App. – San Antonio 1953, no writ).
7 In re Estate of Bean, 120 S.W.3d 914 (Tex. App. – Texarkana 2003, pet. denied); Thornhill v. Elskes, 381 S.W.2d 99, 101 (Tex. Civ. App. – Waco 1964, writ ref’d n.r.e.)
8 In re Estate of Bean, 120 S.W.3d 914, 920 (Tex. App.—Texarkana 2003, pet. denied).
9 Tex. R. Civ. P. 39.
10 Tex. R. Civ. P. 40.
11 Tex. Water Com’n v. Lindsey, 850 S.W.2d 183 (Tex. App. – Beaumont 1992, no pet.).
12 BP America Production Co. v. Marshall, 288 S.W.3d 430, 453 (Tex. App. – San Antonio 2008, rev’d on other grounds, 342 S.W.3d 59).
13 Walker v. Foss, 930 S.W.2d 701 (Tex. App. – San Antonio 1996, no writ).
14 Candlelight Hills Civic Ass’n, Inc. v. Goodwin, 763 S.W.2d 474 (Tex. App. – Houston [14th Dist.] 1988, writ den.).
15 Merry Homes, Inc. v. Chi Hung Luu, 312 S.W.3d 938 (Tex. App. – Houston [1st Dist.] 2010, no pet.).
16 MBM Fin. Corp. v. Woodlands Operating Co., L.P., 292 S.W.3d 660 (Tex. 2009).
17 Tex. Prop. Code § 22.001(a).
18 Tex. Civ. Prac. & Rem. Code § 37.004(a).
19 BP Am. Prod. Co. v. Marshall, 288 S.W.3d 430, 453 (Tex. App. – San Antonio 2008), rev’d on other grounds, 342 S.W.3d 59 (Tex. 2011) citing McRae Expl. & Prod., Inc. v. Reserve Petroleum Co., 962 S.W.2d 676, 685 (Tex. App. – Waco 1998, no pet.).