ID/Guerra LP v. Texas Workforce Commission

TEXAS COURT OF APPEALS, THIRD DISTRICT, AT AUSTIN

NO. 03-09-00422-CV

Gloria Norton, Appellant

v.

Deer Creek Property Owners Association, Inc., Appellee

FROM THE DISTRICT COURT OF TRAVIS COUNTY, 126TH JUDICIAL DISTRICT

NO. D-1-GN-08-002648, HONORABLE RHONDA HURLEY, JUDGE PRESIDING

MEMORANDUM OPINION

Appellee Deer Creek Property Owners Association, Inc. (“Deer Creek”) filed this

lawsuit against one of its residents, appellant Gloria Norton, for violating its restrictive covenants.

Deer Creek alleged that a large gazebo-like structure on Norton’s deck had fallen into disrepair and

was negatively affecting her neighbors’ enjoyment of their property. After a hearing, the trial court

ordered a permanent injunction requiring Norton to remove the gazebo and to comply in the future

with all of Deer Creek’s restrictive covenants. The court also awarded Deer Creek $3,500 in

attorney’s fees under the property code. See Tex. Prop. Code Ann. § 5.006 (West 2004). Norton,

who appeared pro se at the hearing, asserts six points of error on appeal: (1) that the trial court

improperly ordered a permanent injunction during a hearing noticed for a temporary injunction;

(2) that the case was improperly tried “on the merits” without notice to Norton; (3) that Norton was

deprived of her right to trial by jury; (4) that the trial court improperly enforced only certain portions

of a prior settlement agreement between the parties; (5) that Deer Creek was not entitled to attorney’s

fees as consequential damages; and (6) that Deer Creek was not entitled to attorney’s fees under the

property code. As a cross-point, Deer Creek asserts that Norton’s appeal is frivolous and seeks

damages and attorney’s fees. We affirm the trial court’s judgment and overrule the cross-point.

BACKGROUND

Gloria Norton is a resident of the Deer Creek Condominium Planned Unit

Development. Use of the properties in this development are governed by a Declaration of

Covenants, Conditions and Restrictions (“the CCRs”). The CCRs state, in relevant part:

Section 1.12. “Improvements”, shall include, but shall not be limited to, the erection

of, additions to, or alterations of any structure . . . .

...

Section 6.01. Construction of Improvements. . . . [N]o improvements may be

constructed or erected on any Lot by anyone other than the [developer] without the

prior written notice of the Environmental Control Committee appointed by the

Association.

...

Section 7.19. Repair of Buildings. No improvements situated on any Lot or the

Common Area shall be permitted to fall into disrepair, and all such improvements

shall at all times be kept in good condition and repair and adequately painted or

otherwise finished.

Deer Creek, as the property owners’ association for the development, is responsible for enforcing

the CCRs.

2

In February 2008, Deer Creek’s board of directors issued a letter informing Norton

that a cloth-covered gazebo on her deck violated Section 7.19 of the CCRs and asked that she

“repair, replace or remove the gazebo immediately.” The following month, the property adjacent

to Norton’s home was sold to a new resident, John Thompson. According to an affidavit executed

by Thompson and attached to Deer Creek’s application for temporary injunction, the properties

contain “zero lot line” homes that afford minimal separation between the neighboring houses, so that

Norton’s deck is situated very near to Thompson’s front door and living room. Thompson further

averred that while Norton indicated to him prior to his moving in that she would “take care” of the

gazebo, explaining that it was erected during a dispute with a previous neighbor, the cloth cover of

the gazebo nonetheless remained “shredded and very unsightly” for some time.

In June 2008, Deer Creek issued a letter formally notifying Norton of its intention to

pursue legal action if she failed to remove the gazebo. See Tex. Prop. Code Ann. § 209.006

(West 2008) (requiring property owners’ association to give written notice before initiating

enforcement action against owner). Pursuant to the property code, Norton requested a hearing before

Deer Creek’s board regarding the matter. See id. § 209.007 (West 2008). After the hearing failed

to produce a resolution, Deer Creek filed suit against Norton, seeking an injunction and attorney’s

fees in accordance with the property code. See id. § 5.006(a) (“In an action based on breach of a

restrictive covenant pertaining to real property, the court shall allow to a prevailing party who

asserted the action reasonable attorney’s fees . . . .”).

Over the next several months, counsel for Norton and Deer Creek negotiated a

settlement agreement. The agreement was reflected in a document drafted by counsel for Deer

3

Creek, titled “Mutual Release of All Claims,” which stated that each party would discharge any and

all claims against the other arising out of the dispute. The release also stated that each party would

bear its own attorney’s fees in connection with the dispute. Notably, the first provision of the release

contemplated that the gazebo had been removed:

Gloria Norton, on behalf of herself and her assignees, has agreed to this settlement,

and has complied with the terms of this settlement by completely removing the

“gazebo” structure on her back deck, which was the focus of the complaint by Deer

Creek Property Owners Association, Inc.

The unsigned release was delivered to Norton in October 2008. Approximately two months later,

Norton signed, scanned, and e-mailed the release to counsel for Deer Creek, though it is undisputed

that the gazebo still stood on her deck at that time. Based on Norton’s failure to remove the gazebo,

Deer Creek proceeded with this suit. Norton, by that time acting pro se, properly filed a demand for

trial by jury and paid the requisite jury fee. See Tex. R. Civ. P. 216. Trial was initially set for

January 7, 2009, but when counsel for Deer Creek was unable to appear due to a medical emergency,

trial was reset for January 20. Norton, herself scheduled to undergo a medical procedure on

January 21, sought another continuance and obtained a trial setting for May 28. Alleging that Norton

had falsely represented to the court that the conditions of the settlement had already been

fulfilled—i.e., that the gazebo had been taken down when it had not—and that Norton improperly

obtained a continuance at an ex parte hearing, Deer Creek filed a motion to strike the setting, a

motion for sanctions, a motion to reset, and an application for a temporary injunction. The trial court

set a hearing on these matters for March 3. The gazebo was removed from Norton’s deck shortly

before the March 3 hearing, although the parties dispute the exact date.

4

The reporter’s record of the March 3 hearing indicates that the trial court allowed the

parties to make their opening statements off the record. After these opening statements, the contents

of which are unknown, the trial court came back on the record and stated, “The issue of the

hearing will be limited as to whether or not I should order attorney’s fees,” to which Norton

responded, “Okay.” The Court then asked, “Do you have any questions, Ms. Norton?” Norton

answered, “No, I don’t.”

At that time, counsel for Deer Creek testified to the reasonableness of his fees, subject

to cross-examination by Norton, and submitted the language of the parties’ mutual release to the

court to put into the form of an order for permanent injunction.1 With respect to attorney’s fees,

Deer Creek reiterated the position taken in its pleadings that it was entitled to attorney’s fees under

section 5.006 of the property code. See Tex. Prop. Code. Ann. § 5.006. After the close of evidence,

the following exchange occurred:

THE COURT: All right, I’m going to go ahead and enter an order, and here’s

what I understand the agreement of the parties to be just for

the record, because we may have to get an order entered on

this in the hearing.

I understand that Gloria Norton, herself and her assigns have

agreed to removing the gazebo structure on her back deck and

has done so as of today’s date.

NORTON: Yes.

1

Deer Creek never signed the mutual release, citing Norton’s failure to remove the gazebo

until shortly before the hearing.

5

THE COURT: I also understand that she is agreeing here today to keep that

down, and that she has no intention of putting that back on the

deck; is that correct?

NORTON: That’s correct.

THE COURT: All right, that will be ordered. It is further ordered that Ms.

Norton is to comply with all existing Deer Creek declarations,

covenants, conditions, and restrictions in the future which

requires obtaining Environmental Control Committee

approval prior to the erection of any future improvements

including improvements which are attached, unattached,

permanent or temporary. Ms. Norton, I understand that you

are also agreeing to an order to that effect; is that correct?

NORTON: Correct.

THE COURT: All right, that will be so ordered. And that will be in the form

of a permanent injunction.

...

THE COURT: In addition to that, I’m going to award attorney’s fees to the

Deer Creek Property Owners Association in the amount of

$3500 . . . .

The trial court subsequently issued a final judgment ordering a permanent injunction,

consistent with the parties’ agreement at the hearing. At Norton’s request, the trial court issued

findings of fact and conclusions of law to support its judgment, specifically finding that at the

March 3 hearing, “the parties announced in open court that they had resolved the matters in

controversy with the exception of [Deer Creek’s] request for the award of attorney’s fees.” The trial

court further found that Norton had agreed to the entry of a final order on all issues, that she had

waived her rights to a jury trial or a further trial setting, and that she had knowingly and voluntarily

6

agreed to allow the trial court to determine the issue of attorney’s fees. Norton’s motion for new trial

was overruled by operation of law, see Tex. R. Civ. P. 329b(c), and this appeal followed.

STANDARD OF REVIEW

The grant or refusal of a permanent or temporary injunction is ordinarily within the

sound discretion of the trial court and appellate review of the trial court’s action is limited to the

question of whether the action constituted a clear abuse of discretion. See Walling v. Metcalfe,

863 S.W.2d 56, 58 (Tex. 1993); Texas Health Care Info. Council v. Seton Health Plan, Inc.,

94 S.W.3d 841, 851 (Tex. App.—Austin 2002, pet. denied).

In an appeal of a judgment rendered after a bench trial, findings of fact have the same

force and dignity as a jury’s verdict. Anderson v. City of Seven Points, 806 S.W.2d 791, 794

(Tex. 1991). When the appellate record contains a reporter’s record, findings of fact are binding only

if supported by the evidence. Aldine Indep. Sch. Dist. v. Ogg, 122 S.W.3d 257, 265

(Tex. App.—Houston [1st Dist.] 2003, no pet.). If the findings are challenged, we review the

sufficiency of the evidence supporting the findings. Id. A trial court’s conclusions of law are

reviewed de novo, but incorrect conclusions of law do not require reversal if the controlling findings

of fact support the judgment under a correct legal theory. See BMC Software Belgium, N.V.

v. Marchand, 83 S.W.3d 789, 794 (Tex. 2002); Westech Eng’g, Inc. v. Clearwater Constructors,

Inc., 835 S.W.2d 190, 196 (Tex. App.—Austin 1992, no writ).

The availability of attorney’s fees under a particular statute is a question of law that

we review de novo. See Holland v. Wal-Mart Stores, Inc., 1 S.W.3d 91, 94 (Tex. 1999); Colonial

Am. Cas. & Sur. Co., 214 S.W.3d 725, 729 (Tex. App.—Austin 2007, no pet.).

7

DISCUSSION

Procedural Issues

In her first three points of error, Norton complains of certain procedural irregularities

surrounding the trial court’s issuance of the permanent injunction. In connection with each of these

points of error, Norton contends that because she appeared before the trial court pro se, she should

be afforded special consideration with respect to any potential waiver of her procedural complaints.

However, it is well-settled law that “pro se litigants are not exempt from the rules of procedure.”

Wheeler v. Green, 157 S.W.3d 439, 444 (Tex. 2005); see also Mansfield State Bank v. Cohn,

573 S.W.2d 181, 184-85 (Tex. 1978) (“Litigants who represent themselves must comply with the

applicable procedural rules, or else they would be given an unfair advantage over litigants

represented by counsel.”). As a result, Norton’s pro se status at trial will not affect our analysis of

her procedural complaints.2

Norton’s first point of error on appeal is that the trial court improperly ordered a

permanent injunction at a hearing that was noticed for a temporary injunction. While litigants are

ordinarily entitled to separate temporary injunction and permanent injunction hearings, the parties

can agree to waive the separation and combine the two proceedings. See Iranian Muslim Org. v. City

of San Antonio, 615 S.W.2d 202, 208 (Tex. 1981). In the present case, before ordering the

permanent injunction, the trial court asked Norton whether she agreed to keep the gazebo off of her

deck, to which Norton responded, “That’s correct.” The trial court then asked Norton whether she

agreed to comply with all of Deer Creek’s CCRs in the future, further stating, “I understand that you

2

Norton is represented by counsel on appeal.

8

are also agreeing to an order to that effect; is that correct?” Again, Norton responded, “Correct.”

The trial court then stated, “All right, that will be so ordered. And will be in the form of a permanent

injunction.” Norton did not object to the entry of the permanent injunction, stating instead, “I

haven’t violated any of [the CCRs] so far in 10 and a half years.”3 Norton’s statements on the record

reflect that she expressly agreed to the imposition of a permanent injunction, and therefore waived

the separation between temporary and permanent injunction proceedings. See id. This determination

is consistent with the trial court’s conclusion of law C-7, which states, in relevant part, that “Norton,

by her agreements in Court, authorized the imposition of a Permanent Injunction concerning the

future construction of improvements on Gloria Norton’s property.” Because Norton consented to

the combination of the temporary and permanent injunction hearings, we hold that the trial

court did not err in ordering a permanent injunction at the March 3 hearing. Norton’s first point of

error is overruled.

In her second point of error, Norton asserts that the trial court improperly tried the

case “on the merits” without providing her with adequate notice. Texas Rule of Civil Procedure 245

allows a case to be set for trial “with reasonable notice of not less than forty-five days to the parties

of a first setting for trial, or by agreement of the parties.” Tex. R. Civ. P. 245. The rule further

provides that if the case has previously been set for trial, it may be reset at a later date “on any

reasonable notice to the parties or by agreement of the parties.” Id. Norton argues that by

proceeding to trial on the merits at the temporary injunction hearing, the trial court failed to provide

3

This statement appears to be based on Norton’s belief that the gazebo did not actually

violate the CCRs. We need not address that issue, as it is not before us in this appeal.

9

her with any notice, much less reasonable notice, and therefore violated Rule 245 and, by extension,

her fundamental due-process rights. See Custom-Crete, Inc. v. K-Bar Servs., 82 S.W.3d 655, 659

(Tex. App.—San Antonio 2002, no pet.) (holding that failure to comply with Rule 245 results in

violation of fundamental due process). Rule 245 makes clear, however, that a case may be set for

trial at any time “by agreement of the parties.” Tex. R. Civ. P. 245. Therefore, if Norton agreed to

proceed to the merits at the March 3 hearing, Rule 245’s notice requirement is satisfied.

The trial court made findings of fact that at the March 3 hearing, Norton “made a

voluntary and knowing waiver of her right to a further trial setting in this case” and “a voluntary and

knowing agreement to go forward on the last remaining issue, that being [Deer Creek’s] request for

the award of attorney’s fees.” While Norton asserts that these findings are unsupported by the

evidence, the record reflects that when the trial court stated, “The issue of the hearing will be limited

as to whether or not I should order attorney’s fees,” Norton responded, “Okay.” The trial court then

inquired further into Norton’s understanding of the proceedings, stating, “Do you have any questions,

Ms. Norton?” Norton responded, “No, I don’t,” and the hearing proceeded without objection from

Norton. There is no evidence that Norton ever withdrew, qualified, or even voiced concern at any

point during the hearing regarding her initial agreement to proceed to trial on the merits.4 Based on

4

On appeal, Norton emphasizes the fact that just before her testimony at the hearing, she

stated, “I didn’t expect that,” suggesting that this statement indicates some sort of confusion or

reluctance to proceed with trial on the merits. This statement, which occurred after Norton had

cross-examined Deer Creek’s counsel regarding attorney’s fees, appears in the following context:

THE COURT: Okay. Do you wish to come testify[?]

NORTON: Yes, I would.

10

this record, we hold that the trial court’s findings that Norton agreed to proceed to trial without

further notice are sufficiently supported by the evidence. See Ogg, 122 S.W.3d at 265. Therefore,

because the trial court proceeded to trial by agreement of the parties, the notice requirement of Rule

245 was satisfied. See Tex. R. Civ. P. 245 (case may be set for trial with reasonable notice or “by

agreement of the parties”). Norton’s second point of error is overruled.

In her third point of error on appeal, Norton asserts that the trial court improperly

deprived her of her constitutional right to trial by jury. See Tex. Const. art. I, § 15. Norton argues

that because she perfected her right to a jury trial by filing a written demand and paying the requisite

fee, see Tex. R. Civ. P. 216, it was an abuse of discretion for the trial court to deny her a

jury trial without her consent. See Cardenas v. Montfort, Inc., 894 S.W.2d 406, 408 (Tex.

App.—San Antonio 1994, writ denied) (“A court . . . does not have discretion, when a party has

properly requested a jury trial under TRCP 216, and is present in court, to deny that party a jury trial

without that party’s assent.”).

Norton’s argument is premised on her contention that the trial court proceeded with

a bench trial without her consent. The trial court expressly found, however, that Norton agreed to

proceed without a jury at the March 3 hearing, specifically that Norton “made a voluntary and

THE COURT: Okay. You can bring your notes or whatever. Come on up

here. Be careful, please.

NORTON: I didn’t expect that.

It is not at all clear what Norton is referencing by this statement, and we decline to read it as an

objection to proceeding on the merits, particularly given Norton’s previous cross-examination of

counsel and her clear indication of a desire to testify.

11

knowing waiver of her right to a jury trial, and indicated her agreement to the entry of a final order

on all issues.” Norton asserts that this finding is unsupported by the evidence.

The right to a jury trial may be waived by a party’s failure to act, such as a failure to

object to the trial court going forward with a bench trial or a failure to indicate in any way that the

party intends to stand on its perfected right to a jury trial. See In re A.M., 936 S.W.2d 59, 61

(Tex. App.—San Antonio 1996, no writ). Assent to a non-jury trial waives the right to a jury trial

and is “easily implied in a situation in which a party appears before the court without objection and

proceeds to try its case before the bench.” Cardenas, 894 S.W.2d at 409. In the present case, Norton

appeared before the court without objection, made no mention of her request for a jury trial,

repeatedly confirmed her understanding of the proceedings, conducted cross-examination of

witnesses, and ultimately assented to a final judgment.5 Under the circumstances, we cannot

conclude that the trial court’s finding of waiver is unsupported by the evidence.

Norton also argues that she could not have knowingly and voluntarily waived her

right to a jury trial because she did not understand the legal implications of her actions. Specifically,

5

While Norton asserts that her act of appearing and proceeding with a bench trial on the

merits does not constitute waiver of her right to a jury trial, both of the cases Norton cites in support

of this proposition involve parties who filed a jury demand, received an adverse ruling from the trial

court, and then proceeded to a bench trial because they had no other option. See McKern v. McCann,

675 S.W.2d 222, 223-24 (Tex. App.—Austin 1984, writ ref’d) (holding that by announcing ready

and proceeding to judgment in bench trial, appellant “did not waive her right to a jury trial since she

had previously received an adverse ruling on that issue”); Coleman v. Sadler, 608 S.W.2d 344, 346-

47 (Tex. App.—Amarillo 1980, no writ) (holding that appellant “did not waive his right to a jury

trial by announcing ‘ready’ at the non-jury trial” because trial court’s adverse ruling on his jury

demand left him “without a conscious choice between a jury and non-jury trial”). Unlike the parties

in McKern and Coleman, Norton never received an adverse ruling from the trial court on her jury

demand.

12

Norton argues that she should have been admonished that her agreement to the terms of the mutual

release would be interpreted as a waiver of the right to a jury trial. First, Norton did not waive her

right to a jury trial solely by making any agreement on the record, but by proceeding to a bench trial

without any indication whatsoever that she intended to stand on her perfected right to a jury trial.

See In re A.M., 936 S.W.2d at 61. Second, the record reflects that Norton did not enter into an

agreement to be bound by the mutual release. Rather, she agreed on the record to allow the trial

court to decide the issue of attorney’s fees and further agreed to the entry of an order enjoining her

from erecting the gazebo or violating the CCRs. Having expressly agreed to the resolution of all

issues in controversy at the March 3 hearing, there is no credible argument that Norton could

have believed she was entitled to a future jury trial. We note also that with respect to these

agreements, the record reflects no hesitation on Norton’s part nor any pressure from either Deer

Creek or the trial court.

Because Norton expressly agreed to proceed with a bench trial, we hold that the trial

court did not improperly deprive her of her right to a jury. Norton’s third point of error is overruled.

Partial Enforcement of Settlement Agreement

Norton’s fourth point of error on appeal is that the trial court improperly enforced the

mutual release against her but not against Deer Creek. Essentially, Norton complains that the trial

court’s order required her to not return the gazebo to her deck and to comply with all

CCRs—obligations that she had already pledged to accept under the mutual release—yet allowed

Deer Creek to avoid bearing its own attorney’s fees as stipulated in the mutual release. Norton’s

claim fails, however, because while the trial court may have modeled the terms of its order from the

13

prohibitory language contained in the mutual release, the agreement that was enforced by the order

was not the mutual release, but the new agreement entered into by the parties at the hearing. See

Tex. R. Civ. P. 11 (agreement between parties may be “made in open court and entered of record”).

As previously discussed, Norton stated on the record that she agreed to keep the gazebo down

permanently and that she agreed to an order requiring her to comply with all CCRs in the future.

Significantly, the final judgment states, in relevant part:

The Court finds that Gloria Norton has agreed in open court to comply with all

existing [CCRs], now and in the future; and further agrees to remove and has

removed the “gazebo” structure in question and agrees to not put the structure back

up in the future without first seeking approval of [Deer Creek]. The Court approves

the agreement and enters this order pursuant to said agreement.

(Emphasis added) The judgment makes no mention of the mutual release, stating only that the court

considered “the agreements of the parties made on the record, the evidence regarding the issue of

attorney’s fees, and the arguments of counsel and Ms. Norton” before issuing the order. (Emphasis

added) As these statements indicate, the trial court did not unilaterally enforce the mutual release

against Norton. Accordingly, the trial court did not err in declining to incorporate the attorney’s fees

provision of the mutual release into the permanent injunction order.

Norton also argues that Deer Creek should not have been allowed to seek partial

enforcement of the mutual release without first pleading and proving a breach of contract claim. See

Padilla v. La France, 907 S.W.2d 454, 462 (Tex. 1995) (“An action to enforce a settlement

agreement, where consent is withdrawn, must be based on proper pleading and proof.”). The record

reflects that Deer Creek never sought to enforce the mutual release as a binding settlement agreement

14

between the parties. As a result, we need not address Norton’s complaint that Deer Creek failed to

set the required pleading foundation to do so. Again, the trial court did not enforce the mutual

release at the March 3 hearing, but instead entered an order on the agreement made by the parties in

open court.

Norton’s fourth point of error is overruled.

Attorney’s Fees

In her fifth point of error on appeal, Norton argues that the trial court erred in

awarding attorney’s fees because Deer Creek improperly sought attorney’s fees as consequential

damages for her failure to timely perform her obligations under the mutual release.6 Deer Creek’s

original petition clearly seeks attorney’s fees under section 5.006 of the property code, which allows

for an award of attorney’s fees to a prevailing party in a suit based on breach of a restrictive

covenant, and makes no mention of consequential damages for any breach of the mutual release. See

Tex. Prop. Code Ann. § 5.006(a). At the hearing, Deer Creek again argued that it was entitled to

attorney’s fees under section 5.006 of the property code and provided the trial court with a copy of

the statute. Finally, in conclusion of law C-5, the trial court stated that Deer Creek’s attorney’s fees

“are recoverable under Tex. Prop. Code Ann. Section 5.006.” There is simply no support for

6

Norton asserts on appeal that the trial court could have awarded attorney’s fees (1) under

section 5.006 of the property code, (2) as consequential damages based on failure to comply with the

mutual release, and (3) as “unspecified sanctions as requested in Deer Creek’s motions.” Norton

then asserts, correctly, that there was no mention of a motion for sanctions at the March 3 hearing,

so the attorney’s fees awarded could not have represented sanctions. We will therefore address only

the issue of whether attorney’s fees were improperly awarded as consequential damages. We note

that there was also no mention of consequential damages for any breach of the mutual release at the

March 3 hearing.

15

Norton’s theory that attorney’s fees were awarded as consequential damages for breach of contract.

We overrule her fifth point of error.

Norton’s sixth point of error on appeal is that the trial court erred in awarding

attorney’s fees under section 5.006 of the property code because the gazebo had been removed prior

to the hearing, leaving no justiciable dispute. Section 5.006(a) states:

In an action based on breach of a restrictive covenant pertaining to real property, the

court shall allow to a prevailing party who asserted the action reasonable attorney’s

fees in addition to the party’s costs and claim.

Id. Notably, the statute does not require the existence of an ongoing breach at the time of the

judgment in order to award attorney’s fees. By the plain language of the statute, the action need only

be “based on [a] breach” in order to trigger the mandatory award of attorney’s fees. It is undisputed

that the present case is an action based on Deer Creek’s claim that Norton’s gazebo constituted a

breach of a restrictive covenant. Accordingly, this suit is “an action based on breach of a restrictive

covenant,” as contemplated by section 5.006. Id.

Deer Creek, however, is not entitled to attorney’s fees under section 5.006 unless it

can be considered a “prevailing party” under the statute. This case presents the unusual circumstance

of a trial court ordering an injunction against a property owner without first being asked to decide

whether the owner actually breached a restrictive covenant. Cf. City of Houston v. Muse,

788 S.W.2d 419, 423-24 (Tex. App.—Houston [1st Dist.] 1990, no writ) (holding that City was

“prevailing party” because trial court ordered injunction after determining that other party violated

restrictions). Without a statutory definition of “prevailing party,” it is not immediately obvious

16

whether Deer Creek was the prevailing party in the court below on any issues other than the

application of section 5.006 itself. The Texas Supreme Court recently applied federal jurisprudence

when construing a contractual “prevailing party” attorney’s-fees provision that did not define the

term. See Intercontinental Group P’ship v. KB Home Lone Star L.P., 295 S.W.3d 650, 653-54

(Tex. 2009). In Intercontinental, the court noted that under federal law, “a plaintiff ‘prevails’ when

actual relief on the merits of his claim materially alters the legal relationship between the parties by

modifying the defendant’s behavior in a way that directly benefits the plaintiff.” Id. at 654 (quoting

Farrar v. Hobby, 506 U.S. 103, 111-12 (1992)). Based on this federal test, the court held that the

plaintiff, KB Home, could not be considered a “prevailing party” because it recovered no damages,

secured no declaratory or injunction relief, obtained no settlement in its favor, and received none of

the relief sought in its petition. See id. at 655. The Texas Supreme Court’s analysis in construing

an undefined contractual “prevailing party” provision is equally applicable to our construction of the

undefined statutory “prevailing party” provision involved here. Unlike the plaintiff in

Intercontinental, Deer Creek did not “leave the courthouse empty-handed.” Id. Rather, Deer Creek

obtained the injunctive relief that it sought, materially altering the legal relationship between the

parties. In ordering Norton not to return the gazebo to her back deck and to comply with all CCRs

in the future, the court ordered Norton to modify her behavior in a way that directly benefited Deer

Creek. As a result, Deer Creek qualifies as a “prevailing party” under section 5.006.

If a party satisfies the requirements of section 5.006 of the property code, the award

of reasonable attorney’s fees to that party is mandatory, rather than discretionary. See Gorman

v. Countrywood Prop. Owners Ass’n, 1 S.W.3d 915, 918 (Tex. App.—Beaumont 1999, pet. denied).

17

Having determined that Deer Creek was a prevailing party in an action based on breach of a

restrictive covenant pertaining to real property, thereby satisfying the criteria for application of

section 5.006, we hold that the trial court did not err in awarding attorney’s fees to Deer Creek.7

Accordingly, Norton’s sixth point of error is overruled.

Appellee’s Cross-Point: Frivolous Appeal

In a cross-point on appeal, Deer Creek argues that it is entitled to damages on the

ground that Norton’s appeal is frivolous and was brought for purposes of harassment. See Tex. R.

App. P. 45. In determining whether an appeal is frivolous, we review the record from the appellant’s

viewpoint and decide whether the appellant had reasonable grounds to believe that the

judgment could be reversed. Smith v. Brown, 51 S.W.3d 376, 381 (Tex. App.—Houston [1st Dist.]

2001, pet. denied). Whether to grant sanctions for a frivolous appeal is a matter of discretion that

an appellate court exercises with prudence and caution and only after careful deliberation in

truly egregious circumstances. Goss v. Houston Cmty. Newspapers, 252 S.W.3d 652, 657

(Tex. App.—Houston [14th Dist.] 2008, no pet.).

The courts of appeals have identified certain circumstances that tend to indicate that

an appeal is frivolous, such as: (1) an unexplained absence of a statement of facts in the appellant’s

brief; (2) an unexplained failure to file a motion for new trial when it is required to successfully

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We do not address the reasonableness of the amount of attorney’s fees awarded by the trial

court, as Norton does not raise the issue on appeal. Of the $4,200 requested by Deer Creek’s counsel

at the hearing, the trial court awarded $3,500. The trial court declined to award the $7,500 in

conditional appellate fees requested by Deer Creek’s counsel, as well as the additional fees requested

in the event that Norton filed an unsuccessful motion for new trial.

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assert factual insufficiency on appeal; (3) a poorly written brief raising no arguable points of error;

or (4) the appellant’s unexplained failure to appear at oral argument. See, e.g., Faddoul v. Oaxaca,

52 S.W.3d 209, 213 (Tex. App.—El Paso 2001, no pet.); In re S.R.M., 888 S.W.2d 267, 269

(Tex. App.—Houston [1st Dist.] 1994, no writ). None of these circumstances are present here.

Moreover, although our decision overrules each of Norton’s points of error, Deer Creek has not

demonstrated that Norton’s appeal is among the “truly egregious circumstances” for which we would

award damages. See Goss, 252 S.W.3d at 657. Accordingly, Deer Creek’s cross-point is overruled.

CONCLUSION

Having overruled each of Norton’s six points of error as well as Deer Creek’s

cross-point, we affirm the judgment of the trial court.

__________________________________________

Diane M. Henson, Justice

Before Justices Patterson, Puryear and Henson

Affirmed

Filed: July 22, 2010

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