                                                                                           ACCEPTED
                                                                                       01-13-00853-CV
                                                                            FIRST COURT OF APPEALS
                                                                                    HOUSTON, TEXAS
                                                                                 10/13/2015 4:38:37 PM
                                                                                 CHRISTOPHER PRINE
                                                                                                CLERK

                              No. 01-13-00853-CV

       In the First District Court of AppealsFILED IN
                                       1st COURT OF APPEALS
                                                                  HOUSTON, TEXAS
                                                               10/13/2015 4:38:37 PM
                            Dernick Resources, Inc.
                                                               CHRISTOPHER A. PRINE
                             Appellant / Cross-Appellee                 Clerk

                                        V.

  David Wilstein and Leonard Wilstein, Individually and
 as Trustee of the Leonard and Joyce Wilstein Revocable
                             Trust
                  Appellees / Cross-Appellants

            On Appeal from Cause No. 2002-31310
       164th District Court of Harris County, Texas
         Hon. Alexandra Smoots-Hogan, Presiding

   RESPONSE TO “EMERGENCY” MOTION TO INCREASE
  AMOUNT OF DEPOSIT IN LIEU OF SUPERSEDEAS BOND

Jackson Walker L.L.P.                 Squire Patton Boggs (US) LLP

      Kathrine M. Silver                         D. Patrick Long
       ksilver@jw.com                         pat.long@squirepb.com
      Richard A. Howell                       Dylan O. Drummond
         rahowell@jw.com                 dylan.drummond@squirepb.com
1401 McKinney St., Suite 1900            2000 McKinney Ave., Suite 1700
     Houston, TX 77010                           Dallas TX 75201
 (713) 752-4340 (Telephone)                (214) 758-1500 (Telephone)
  (713) 752-4221 (Facsimile)                (806) 758-1550 (Facsimile)



          Counsel for Appellant / Cross-Appellee Dernick Resources, Inc.




 010-8150-6461/3/AMERICAS
                            TABLE OF CONTENTS
Table of Contents .................................................... i
Index of Authorities ............................................... ii
Introduction ........................................................... 1
Factual Background ............................................... 2
Argument in Response ............................................. 3
     I.      This Court’s Judgment Only Becomes Enforceable
             When the Mandate Issues ........................................ 4
     II.     Professor Carlson Confirms This Understanding of the
             Rules ................................................................ 7
     III. Reliance on the Mandate to Enforce the Judgment is
          Routine Practice in this Court and Other Courts ............ 10
Conclusion & Prayer ............................................ 13
Appendix
     September 25, 2015 Order Denying Plaintiffs’ Motion to
     Increase Supersedeas Deposit ...................................Tab A
     Excerpt from Prof. Elaine A. Carlson, Supersedeas Issues in
     Texas, in State Bar of Tex. Prof. Dev. Program, Civil
     Appellate Practice 101, Ch. 11 (2015) ........................... Tab B




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                           INDEX OF AUTHORITIES

Cases
Texas Supreme Court
Black v. Epperson,
      40 Tex. 162 (1874)................................................ 1, 7
Edwards Aquifer Auth. v. Chem. Lime, Ltd,
     291 S.W.3d 392 (Tex. 2009) ....................................1, 5
In re Corral-Lerma,
       451 S.W.3d 385 (Tex. 2014) (per curiam)
       (orig. proceeing) ...............................................12–13
In re Long,
       984 S.W.2d 623 (Tex. 1999) (per curiam)
       (orig. proceeing) ..................................................... 5
In re Longview Energy Co.,
       464 S.W.3d 353 (Tex. 2015) (orig. proceeing) ..............12–13
Miga v. Jenson,
      299 S.W.2d 98 (Tex. 2009) ........................................ 7
In re Nalle Plastics Family L.P.,
       406 S.W.3d 168 (Tex. 2013) (orig. proceeding) ............. 9, 12
Intermediate Appellate Courts
In re City of Cresson,
       245 S.W.3d 72 (Tex. App.—Fort Worth 2008,
       orig proceeding) ..................................................... 5
Dernick Res., Inc. v. Wilstein,
      No. 01-13-00853-CV, 2015 Tex. App. LEXIS 6684
      (Tex. App.—Houston [1st Dist.] June 30, 2015, no
      pet. h.) ............................................................ 2–3
Entergy Gulf Sts., Inc. v. Traxler,
      No. 09-09-00362-CV, 2013 Tex. App. LEXIS 362
      (Tex. App.—Beaumont Jan. 17, 2013, no pet.) (mem. op.) ... 12




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Sandoval v. Am. Point Realty, Ltd.,
     No. 01-14-00988-CV, 2015 Tex. App. LEXIS 6922
     (Tex. App.—Houston [1st Dist.] July7, 2015) (mem. op.)
     (per curiam) ....................................................10–11
Smith v. Fifth Third Mortg.,
      Order dated Dec. 4, 2013, No. 05-13-00499-CV
      (Tex. App.—Dallas Nov. 5, 2013, pet. denied) ............ 11–12
Strebel v. Wimberly,
       371 S.W.3d 267 (Tex. App.—Houston [1st Dist.] 2012,
       pet. denied) .........................................................11
Univ. Life Ins. Co. v. Giles,
      982 S.W.2d 488 (Tex. App.—Texarkana 1998,
      writ denied) .......................................................... 5
Warren E&P, Inc. v. Gotham Ins. Co.,
     Agreed Motion to Expedite Mandate, No. 08-10-00198-
     CV (Tex. App.—El Paso Nov. 5, 2014, no pet.) ............... 12

Rules
Tex. R. App. P. 9.5(d), (e) ............................................. 15
Tex. R. App. P. 18.1 ...................................................... 4
Tex. R. App. P. 24.1(f) ............................................... 3, 6
Tex. R. App. P. 24.2(a)(1) ............................................... 2
Tex. R. App. P. 24.3(a)(2) ............................................6–7
Tex. R. App. P. 51.1(b) ............................................ 3, 4, 7

Secondary Sources
Yogi Berra with Dave Kaplan, When You Come
    to a Fork in the Road, Take It (2001) ................. 1
Elaine A. Carlson, Reshuffling the Deck: Enforcing and
      Superseding Civil Judgments on Appeal after House Bill 4,
      46 S. Tex. L. Rev. 1035 (2005) ............................ 9–10




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Prof. Elaine A. Carlson, Supersedeas Issues in Texas, in State Bar
       of Tex. Prof. Dev. Program, Civil Appellate Practice 101,
       Ch. 11 (2015) ......................................................1, 9
6 Roy W. McDonald & Elaine A. Carlson, Texas Civil Practice
     § 14:20 (2d ed. 1998) ...................................... 4, 9–10
Stacey Obenhaus, It Ain’t Over ‘Til It’s Over: The Appellate
      Mandate in Texas Courts, App. Advoc., Winter 2003 .. 1, 5–6




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                                   INTRODUCTION
          As the late, great Yogi Berra sagely declared, “‘It ain’t over ‘til

it’s over.’”1 Texas law has made clear for nearly 150 years that the

trial court judgment remains operative until the appeal is over and the

mandate issues. 2 Appellees and Cross-Appellants David Wilstein and

Leonard Wilstein, Individually and as Trustee of the Leonard and

Joyce Wilstein Revocable Trust (the “Wilsteins”) fundamentally

misunderstand the distinction between the effectiveness of this

Court’s judgment and enforcement of it.3

          Because no law supports its grant, and without even any

“emergency” underlying its supposed urgency, this Court should

deny the Wilsteins’ Emergency Motion to Increase Amount of

Deposit in Lieu of Supersedeas Bond (the “Motion”).


          1
               Edwards Aquifer Auth. v. Chem. Lime, Ltd., 291 S.W.3d 392, 413,
413 n.2 (Tex. 2009) (Willett, J., concurring) (quoting Yogi Berra with
Dave Kaplan, When You Come to a Fork in the Road, Take
It 88 (2001) and citing generally Stacey Obenhaus, It Ain’t Over ‘Til It’s Over:
The Appellate Mandate in Texas Courts, App. Advoc., Winter 2003).
          2
                See, e.g., Black v. Epperson, 40 Tex. 162, 180 (1874) (trial court clerk
without “authority to issue execution” until appellate court’s mandate filed in
clerk’s office); Prof. Elaine A. Carlson, Supersedeas Issues in Texas, in State Bar of
Tex. Prof. Dev. Program, Civil Appellate Practice 101 Ch. 11, at 30 (2015)
(emphasis added).
          3
                     See Chem. Lime, 291 S.W.3d at 411 (Brister, J., concurring).
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                               FACTUAL BACKGROUND
          The          trial    court   rendered     final     judgment         (the

“Original Judgment”) in favor of the Wilsteins in July 2013 for

$3,373,452.45. In response, Dernick Resources, Inc. (“Dernick”)

deposited with the Court $583,427.08 in November 2013 to supersede

the Original Judgment. A year later, Dernick deposited another million

dollars into the trial court’s registry, which raised the total appellate

security on deposit to $1,583,427.08. The Wilsteins admit that this

amount: (1) has been found to be sufficient by both this Court and the

trial court; and (2) “fully superseded” the Original Judgment. 4

(Wilsteins’ Motion to Increase Supersedeas Deposit, at 2–3).

          In June 2015, this Court issued its decision and judgment in the

case, which modified the Original Judgment by increasing it to

$4,489,376.71 (the “Modified Judgment”)—awarding the Wilsteins

and additional $750,000.00 for production-revenue damages and

$365,924.26 in prejudgment interest on that claim. Dernick Res., Inc. v.

          4
                In order to supersede the Original Judgment, Dernick was required
to deposit the sum of: (1) the interest for the estimated duration of the appeal; and
(2) the awards for compensatory damages and costs. Tex. R. App. P. 24.2(a)(1).
Here, the $1,583,427.08 deposited by Dernick into the Court’s registry is
sufficient to supersede the Original Judgment during appellate proceedings lasting
in excess of 19 years.
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Wilstein, No. 01-13-00853-CV, 2015 Tex. App. LEXIS 6684, at *73

(Tex. App.—Houston [1st Dist.] June 30, 2015, no pet. h.). Dernick

sought rehearing, which was denied September 22, 2015. Dernick now

intends to petition the Texas Supreme Court for review.

          On September 25, 2015, the trial court below denied the

Wilsteins attempt to require Dernick to increase its supersedeas

deposit based upon the Modified Judgment. (App’x Tab A).

                           ARGUMENT IN RESPONSE
          The black-letter law governing the resolution of this Motion is

not open to serious dispute. “[E]nforcement of a judgment must be

suspended” when the “judgment is superseded,” and an “appellate

court’s judgment” cannot “be enforced” by the trial court” until the “trial

court clerk receives the mandate.” Compare Tex. R. App. P. 24.1(f)

(emphasis added), with Tex. R. App. P. 51.1(b) (emphasis added).

The supersedeas amount can only change once the mandate issues.

          But the Wilsteins argue that the supersedeas amount should be

increased to account for the additional $750,000 included in the

Modified Judgment (along with postjudgment interest on this

amount)—prior to issuance of the mandate. This proposal is converse


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to the procedure routinely applied by Texas intermediate appellate

courts, and recited in legal hornbooks and treatises as well. See, e.g.,

6 Roy W. McDonald & Elaine A. Carlson, Texas Civil Practice § 14:20

(2d ed. 1998) [hereinafter Texas Civil Practice].

          The Court should decline the Wilsteins’ invitation to radically

depart from established appellate procedure, and deny their Motion.

I.        This Court’s Judgment Only Becomes Enforceable When the
          Mandate Issues
          The Wilsteins are wrong to suggest that the amount necessary

to supersede a judgment changes when this Court issues an opinion.

This Court’s judgment only becomes enforceable when the mandate

issues.

          Just as a trial court’s judgment may be reversed or

reconsidered, the same is true of a decision by a court of appeals. For

this reason, the rules create a device called the mandate. Therefore,

the appellate judgment becomes enforceable only when the mandate

issues. Tex. R. App. P. 51.1(b). The mandate does not issue until the

appellate process has run its full course. Tex. R. App. P. 18.1. This is

why an appeal results in both an appellate judgment and a mandate.

“Postponing enforcement of [appellate court] decisions is not the
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same as postponing when they are effective.” Edwards Aquifer Auth. v.

Chem. Lime, Ltd., 291 S.W.3d 392, 411 (Tex. 2009) (Brister, J.,

concurring).               The former is not self-executing, but is instead

provisional until the latter issues.

          Texas courts—including the Supreme Court—recognize that

appellate court judgments are “not enforceable in the trial court until

… mandate issues.” In re City of Cresson, 245 S.W.3d 72, 74

(Tex. App.—Fort Worth 2008, orig. proceeding) (emphasis added);

see In re Long, 984 S.W.2d 623, 624, 626 (Tex. 1999) (per curiam)

(orig. proceeding) (trial court clerk not obligated to comply with

appellate court judgment until mandate issued); see also Chem. Lime,

291 S.W.3d at 415 (Tex. 2009) (Willett, J., concurring) (the “date of

the mandate” is when the “judgment [becomes] enforceable”).

          As their sole contrary authority in the trial court, the Wilsteins

relied on an overturned court of appeals decision. (See Dernick Resp.

Mot. Increase Supersedeas Deposit, at 3–4 (explaining that Universe

Life Insurance Co. v. Giles, 982 S.W.2d 488, 491–92 (Tex. App.—

Texarkana 1998, writ denied), was overturned by the Texas Supreme

Court in In re Long, 984 S.W.2d at 626); Stacey Obenhaus, It Ain’t

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Over ‘Til It’s Over: The Appellate Mandate in Texas Courts, App.

Advoc., Winter 2003, at 7 n.31 (same). The Wilsteins apparently

agree that Giles is not good law—it makes no appearance in their

motion to this Court—but they have replaced it with nothing. They

now cite no authority for their novel suggestion that a supersedeas

amount should change before issuance of the mandate.

          Rule 24.1(f) commands that “enforcement of a judgment must

be suspended if the judgment is superseded.” Tex. R. App.

P. 24.1(f). The Wilsteins acknowledge that Dernick’s deposit was

sufficient to supersede the trial court’s judgment. (See Wilsteins’

Emergency Mot. Increase Deposit, at 3 (calling the deposit “no longer

sufficient”); Wilsteins’ Motion to Increase Supersedeas Deposit, at 3

(“[O]riginal [J]udgment was fully superseded”)). Therefore, it is

undisputed that Dernick has suspended enforcement of the trial

court’s judgment during the pendency of the appeal of this matter.

          After a trial court loses plenary power as the Court below has

here, it only retains “continuing jurisdiction … to modify the amount

or type of security required to continue the suspension of a

judgment’s execution … [i]f circumstances change.” Tex. R. App.

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P. 24.3(a)(2) (emphasis added). As a matter of law, there can be no

change in the circumstances regarding suspension of the Original

Judgment because the Modified Judgment cannot be enforced by the

trial court until it receives this Court’s mandate. See Black v. Epperson,

40 Tex. 162, 180 (1874) (trial court clerk without “authority to issue

execution” until appellate court’s mandate filed in clerk’s office);

Tex. R. App. P. 51.1(b). And without any change in the

circumstances possible until the mandate issues, no “emergency” can

exist to justify the filing of this Motion.

          As the Texas Supreme Court has explained, superseding a

judgment “defers payment until the matter is resolved.” Miga v.

Jensen, 299 S.W.3d 98, 100 (Tex. 2009). This matter will be

“resolved” only once the mandate issues—after review in the Texas

Supreme Court is completed.

II.       Professor Carlson Confirms This Understanding of the Rules
          Without explanation, the Wilsteins dismiss the import and

effect of the mandate as “facially erroneous.” (Wilsteins’ Emergency

Mot. Increase Deposit, at 1). To the contrary, this is literally

“Appellate Practice 101.”


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          Professor Elaine Carlson addressed this precise issue in a paper

presented last month at the Texas Civil Appellate Practice 101 course: 5

                [T]here is no authority that empowers the trial
          court to order an increase or decrease in appellate
          security premised upon an appellate court judgment
          when that judgment is subject to further appellate review,
          and no mandate has issued.

                                        ⁂

                  Until a final adverse judgment on appeal is
          rendered, the security continues to serve to supersede the
          trial court’s judgment. An appealable judgment, which by
          its nature may not be enforced until completion of the
          appellate process, should not be considered a changed
          circumstance that would support trial court modification
          of appellate security. To hold to the contrary, would be
          inconsistent with not only one final judgment principles
          and with the clear directive that an appellate judgment is
          not enforceable unless a mandate has issued and no
          further appellate review is sought. A trial court
          empowered to increase appellate security requirements
          when no Court of Appeals mandate has issued and Texas
          Supreme Court review is pending, would, in effect, have
          the ability to enforce the appealable judgment.

                                        ⁂

                Thus, the trial court judgment should remain the
          operative judgment until the appellate process is
          complete and a judgment is entered by the appellate court


          5
               Which, as opposed to the Advanced Civil Appellate Practice
Course, is offered annually as a general overview of the basic tenets of Texas
appellate practice, in part to assist applicants prepare for the civil appellate law
exam administered by the Texas Board of Legal Specialization.
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          and the appellate court issues its mandate requiring
          recognition and enforcement of its judgment.

Prof. Elaine A. Carlson, Supersedeas Issues in Texas, in State Bar of

Tex. Prof. Dev. Program, Civil Appellate Practice 101 Ch. 11, at 29–30

(2015) (emphasis added) (App’x Tab B).

          Professor Carlson is a recognized expert on Texas civil

procedure in general and supersedeas in particular. See In re Nalle

Plastics        Family     L.P.,   406   S.W.3d   168,   170   (Tex.   2013)

(orig. proceeding) (quoting Elaine A. Carlson, Reshuffling the Deck:

Enforcing and Superseding Civil Judgments on Appeal after House Bill 4,

46 S. Tex. L. Rev. 1035, 1038 (2005) [hereinafter Reshuffling the

Deck]).

          Professor Carlson’s article is consistent with her treatise,

McDonald & Carlson, on Texas civil procedure:

                 Even though the court of appeals may modify the
          trial court judgment, if the trial court judgment is
          properly superseded, no additional appellate security
          should be required. An appealable judgment, which by its
          nature may not be enforced until completion of the
          appellate process, is not a changed circumstance that
          would support trial court modification of appellate
          security.




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Texas Civil Practice § 14:20 (emphasis added); accord Reshuffling the

Deck, 46 S. Tex. L. Rev. at 1106.

          This commentary accurately describes Texas law. This Court’s

modification of the trial court’s judgment cannot constitute a

“changed circumstance,” and therefore does not require additional

appellate security.

III.      Reliance on the Mandate to Enforce the Judgment is Routine
          Practice in this Court and Other Courts
          This Court and other courts of appeals routinely apply the

black-letter rule that appellate security should not be altered until the

mandate issues. The issue arises most frequently when a defendant

seeks release of a supersedeas bond, which requires expedited issuance

of the mandate.

          The best example is this Court’s decision this past summer in

Sandoval v. American Point Realty, Ltd., No. 01-14-00988-CV, 2015

Tex. App. LEXIS 6922 (Tex. App.—Houston [1st Dist.] July 7, 2015)

(mem. op.) (per curiam). In that case, pursuant to an agreement, the

appellants filed an unopposed motion to dismiss the appeal and asked

this Court to order “that the Clerk of the Court expeditiously release

the funds Appellants posed as security.” Appellant’s Unopposed
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Motion to Dismiss, at 2, in Am. Point Realty, 2015 Tex. App. LEXIS

6922. The motion said nothing about the mandate, but this Court

correctly recognized that the relief sought—releasing the security—

was only proper upon issuance of the mandate. As a result, the panel

“construe[d] this motion to include a motion to expedite the

mandate” and directed the trial clerk to release the security “after

receipt of the mandate.” Am. Pointe Realty, 2015 Tex. App.

LEXIS 6922, at *1–2.

          This is routine. In Strebel v. Wimberly, this Court reversed and

remanded a trial court’s judgment. 371 S.W.3d 267, 269 (Tex. App.—

Houston [1st Dist.] 2012, pet. denied). The appellant requested

expedited issuance of the mandate because he “continue[d] to incur

costs related to the supersedeas bond for each day that the mandate

does not issue.” See Unopposed Motion to Immediately Issue

Mandate, at 1, in Strebel, 371 S.W.3d 267. Numerous other cases and

litigants have recognized the connection between issuance of the

mandate and release of the supersedeas bond. 6


          6
                See, e.g., Order dated Dec. 4, 2013, at 1, in Smith v. Fifth Third
Mortg., No. 05-13-00499-CV (Tex. App.—Dallas Nov. 5, 2013, pet. denied) (“We
GRANT appellee’s November 6, 2013 motion to release the supersedeas bond in
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          There is no serious dispute to the contrary. It is understandable

that the Wilsteins seek to enforce this Court’s modification of the

judgment without waiting for the appellate process to conclude. It is

similarly understandable that defendants who succeed on appeal seek

release of a supersedeas bond as soon as possible. To both, our rules of

appellate procedure provide the same answer—wait for the mandate

to issue.

          In recent years, the Texas Supreme Court has regularly resisted

plaintiffs’ attempts to impose additional supersedeas requirements,

mindful that our supersedeas rules are “protective of debtors” and

preserve “the right to a meaningful appeal.” In re Longview Energy

Co., 464 S.W.3d 353, 359–60 (Tex. 2015) (an award that “bears no

resemblance to any recognized form of damages” need not be

superseded); see also Nalle Plastics, 406 S.W.3d at 175–76 (attorney’s



this case only to the extent that the bond shall be released when the mandate
issues.”); Agreed Motion to Expedite Mandate, at 1–2, Warren E&P, Inc. v.
Gotham Ins. Co., No. 08-10-00198-CV (Tex. App.—El Paso Nov. 5, 2014, no pet.)
(“In order to facilitate recovery of the supersedeas bond posted below …, Pedeco
requests that the Court issue an expedited mandate.”); Entergy Gulf Sts., Inc. v.
Traxler, No. 09-09-00362-CV, 2013 Tex. App. LEXIS 362, at *1 (Tex. App.—
Beaumont Jan. 17, 2013, no pet.) (mem. op.) (“The parties also request that the
surety be released from its obligation on the supersedeas bond and that the
mandate issue immediately.”).
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fees need not be superseded); In re Corral-Lerma, 451 S.W.3d 385,

387–88 (Tex. 2014) (per curiam) (orig. proceeding) (interest on

attorney’s fees need not be superseded).

          The Wilsteins’ novel attempt to increase Dernick’s supersedeas

amount should meet with the same fate. Their arguments are

unsupported by any authority and conflict with black-letter rules of

appellate procedure. The Motion should be denied.

                           CONCLUSION AND PRAYER
          For the foregoing reasons, Dernick requests the Court to:

(1)       Deny the Wilsteins’ Motion;

(2)       Award Dernick its reasonable and necessary attorney fees
          incurred in opposing the Motion; and

(3)       Grant all other and such relief to Dernick to which it may be
          entitled, either at law or in equity.




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                                   Respectfully submitted,

                                   By:    /s/ D. Patrick Long

                                   JACKSON WALKER, L.L.P.
                                      Kathrine M. Silver
                                      Texas Bar No. 24013510
                                      ksilver@jw.com
                                      Richard A. Howell
                                      Texas Bar No. 10106500
                                      rahowell@jw.com
                                   1401 McKinney, Suite 1900
                                   Houston, TX 77010
                                   (713) 752-4340 (Telephone)
                                   (713) 752-4221 (Facsimile)

                                   SQUIRE PATTON BOGGS (US),
                                   LLP
                                      D. Patrick Long
                                      Texas State Bar No. 12515500
                                      patrick.long@squirepb.com
                                      Dylan O. Drummond
                                      Texas State Bar No. 24040830
                                      dylan.drummond@squirepb.com
                                   2000 McKinney Avenue, Suite 1700
                                   Dallas, TX 75201
                                   (214) 758-1500     Telephone
                                   (214) 758-1550     Facsimile

                                   Counsel for Appellant / Cross-
                                   Appellee Dernick Resources, Inc.




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                           CERTIFICATE OF SERVICE
      In    compliance      with    Texas    Rule    of    Appellate
Procedure 9.5(d) & (e), the undersigned counsel electronically served
on October 13, 2015 a copy of the foregoing via the manner indicated
below:
 Britton D. Monts                       via Electronic Filing Manager
 bmonts@themontsfirm.com                via Certified Mail, RRR
 The Monts Firm                         via U.S. Mail (First Class)
 401 Congress Avenue, Suite 1540        via Federal Express
 Austin, TX 78701                       via Facsimile
 Facsimile: (512) 692-2981              via E-mail
                                        via Hand Delivery

 Tom C. McCall, Esq.                    via Electronic Filing Manager
 tmccall@themccallfirm.com              via Certified Mail, RRR
 David B. McCall, Esq.                  via U.S. Mail (First Class)
 dmccall@themccallfirm.com              via Federal Express
 The McCall Firm                        via Facsimile
 3660 Stoneridge Road, Suite F-102      via E-mail
 Austin, TX 78746                       via Hand Delivery
 Facsimile: (512) 477-2271




Response to “Emergency” Motion to Increase Amount of         Page 15 of 16
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 Kendall M. Gray                           via Electronic Filing Manager
 kendallgray@andrewskurth.com              via Certified Mail, RRR
 Georgia L. Lucier                         via U.S. Mail (First Class)
 georgialucier@andrewskurth.com            via Federal Express
 Andrews Kurth LLP                         via Facsimile
 600 Travis Street, Suite 4200             via E-mail
 Houston, TX 77002                         via Hand Delivery
 Facsimile: (713) 238-7349


 Attorneys for Plaintiffs David Wilstein
 and Leonard Wilstein, Individually
 and as Trustee of the Leonard and
 Joyce Wilstein Revocable Trust


                                    /s/ D. Patrick Long
                                    Kathrine M. Silver
                                    Richard A. Howell
                                    D. Patrick Long
                                    Dylan O. Drummond




Response to “Emergency” Motion to Increase Amount of            Page 16 of 16
Deposit in Lieu of Supersedeas Bond
010-8150-6461/3/AMERICAS
          APPENDIX




Response to “Emergency” Motion to Increase Amount of   Page A-1
Deposit in Lieu of Supersedeas Bond—Appendix
010-8150-6461/3/AMERICAS
                           TAB A




Response to “Emergency” Motion to Increase Amount of   Page A-2
Deposit in Lieu of Supersedeas Bond—Appendix
010-8150-6461/3/AMERICAS
                           TAB B




Response to “Emergency” Motion to Increase Amount of   Page A-3
Deposit in Lieu of Supersedeas Bond—Appendix
010-8150-6461/3/AMERICAS
SUPERSEDEAS ISSUES IN TEXAS




              Presented by:
        DUSTIN M. HOWELL
       Assistant Solicitor General
 Office of the Texas Attorney General
       P.O. Box 12548 (MC 059)
          Austin, Texas 78711
      (512) 936-0826 (Telephone)
        (512) 474-2697 (Telefax)
dustin.howell@texasattorneygeneral.gov

             Written by:
   PROF. ELAINE A. CARLSON
    Stanley J. Krist Distinguished
       Professor of Texas Law
     South Texas College of Law
        Houston, Texas 77002
     (713) 646-1870 (Telephone)
      (713) 646-1777 (Telefax)
          ecarlson@stcl.edu




        State Bar of Texas
CIVIL APPELLATE PRACTICE 101
        September 9, 2015
              Austin

           CHAPTER 11
Supersedeas Issues in Texas                                                                                              Chapter 11

     A voluntary and unconditional satisfaction of                       security is insufficient to bond the trial court’s
judgment pending appeal will moot the controversy.352                    judgment. However, there is no authority that
Absent some remaining controversy, the appellate                         empowers the trial court to order an increase or
court must dismiss for want of jurisdiction. Appellate                   decrease in appellate security premised upon an
courts may not issue advisory opinions. 353 However,                     appellate court judgment when that judgment is subject
payment on a judgment will not moot an appeal if the                     to further appellate review, and no mandate has issued.
judgment debtor clearly expresses an intent to exercise                  Put another way, the obligation of a judgment debtor is
his right to pursue an appeal. 354 Generally, the                        to post appellate security in accordance with Appellate
involuntary satisfaction of a judgment will not moot an                  Rule 24 to suspend enforcement of the trial court
appeal. 355                                                              judgment. The court of appeals is to issue its mandate
                                                                         only when further appellate review is not sought.
H. Supersedeas on Appeal to Texas Supreme                                Specifically, the court of appeals mandate may issue
     Court or U.S. Supreme Court                                         only when one of the following periods expires:
     A take-nothing judgment does not require a
supersedeas bond, since there is no judgment requiring                          (1) Ten days after the time has expired for filing
enforcement against assets. If a take-nothing judgment                              a motion to extend time to file a petition for
is reversed by a court of appeals, a supersedeas bond                               review or a petition for discretionary review
presumptively need not be posted in order to forestall                              if:
execution pending Texas or United States Supreme
Court review, because execution should not occur until                                (A) no timely petition for review or petition
the mandate issues. 356 A losing party may move the                                       for discretionary review has been filed;
court of appeals for a stay of judgment.                                                  [or]
     Once appellate security is filed in accordance with                              (B) no timely filed motion to extend time to
Appellate Rule 24, enforcement of that judgment is                                        file a petition for review or petition for
suspended pending a final “adverse judgment on                                            discretionary review is pending. 358
appeal.” 357 However, the trial court retains jurisdiction
to modify the required appellate security in the event                   When further review is sought but denied by the Texas
that a surety becomes insufficient, or the amount of                     Supreme court, the mandate is to issue:

                                                                                Ten days after the time has expired for filing
352
    Continental Cas. Co. v. Huizar, 740 S.W.2d 429 (Tex.                        a motion to extend time to file a motion for
1987); Dalho Corp. v. Tribble & Stephens, 762 S.W.2d 733                        rehearing of a denial, refusal, or dismissal of
(Tex. App.—San Antonio 1988, no writ).                                          a petition for review, or a refusal or dismissal
353
    See Continental Cas. Co. v. Huizar, 740 S.W.2d 429                          of a petition for discretionary review, if no
(Tex. 1987) (payment under duress would not render appeal                       timely filed motion for rehearing or motion
moot).                                                                          to extend time is pending. 359
354
       Miga v. Jensen, 96 S.W.3d 207 (Tex. 2002)
(acknowledging that a litigant must be able to halt the                  The district clerk bears the responsibility for
accrual of post-judgment interest and yet preserve the right             determining when funds deposited to supersede a
to appeal).                                                              judgment may be released and is not to do so “until the
355                                                                      conditions of liability in [Rule 24.1] (d) are
   Riner v. Briargrove Park Prop. Owners, Inc., 858 S.W.2d
370, 370 (Tex.1993).                                                     extinguished.” 360 The clerk also is the officer
356
                                                                         responsible for issuing writs of execution. 361 The clerk
     See TEX. R. APP. P. 51.1. See also In re Long, 984                  is directed under the rules, that execution is not to issue
S.W.2d 623, 625 (Tex. 1998) (orig. proceeding) (When a                   when a trial court judgment has been superseded on
county official, such as a district clerk, is sued in an official
                                                                         appeal. 362 The district clerk is further directed that it is
capacity, the timely filing of a notice of appeal operates as a
supersedeas bond and suspends enforcement of the
underlying judgment on appeal; accordingly, the underlying
superseded judgment cannot form the basis for contempt for
acts occurring during the appeal in violation of the lower
court judgment which are the subject of the appeal until                 358
                                                                               TEX. R. APP. P. 18.1.
there is a mandate issued by the final appellate court.). But
                                                                         359
see Universe Life Ins. Co. v. Giles, 982 S.W.2d 488, 490                       TEX. R. APP. P. 18.1(a)(2).
(Tex. App.—Texarkana 1998, pet. denied) (Once appeal is                  360
                                                                               Tex. R. App. P. 24.1(c)(3).
final, a supersedeas bond no longer precludes enforcement
                                                                         361
of judgment.).                                                                 TEX. R. CIV. P. 627.
357                                                                      362
      TEX. R. APP. P. 24.1.                                                    TEX. R. CIV. P. 627.
                                                                    29
Supersedeas Issues in Texas                                                                                           Chapter 11

not to enforce an appellate court judgment until the                 judgment.” 368 However, if a stay is denied, the rules
clerk receives the mandate. 363                                      are silent as to any right to supersede. It is unnecessary
      Until a final adverse judgment on appeal is                    to supersede when a stay of enforcement is obtained.
rendered, the security continues to serve to supersede
the trial court's judgment. An appealable judgment,                  I.    Disposition of Security on Conclusion of
which by its nature may not be enforced until                              Appellate Review
completion of the appellate process, should not be                         The liability of a surety on a supersedeas bond, or
considered a changed circumstance that would support                 other appellate security, following final disposition on
trial court modification of appellate security. To hold              appeal is dependent upon the nature of the appellate
to the contrary, would be inconsistent with not only                 judgment. Appellate rule 24.1(d) provides the surety 369
one final judgment principles and with the clear                     is responsible up to the amount of the bond, deposit in
directive that an appellate judgment is not enforceable              lieu of bond, or alternate security if (1) the debtor does
unless a mandate has issued and no further appellate                 not perfect the appeal, or the appeal is dismissed, when
review is sought. A trial court empowered to increase                the debtor does not perform the trial court judgment or
appellate security requirements when no Court of                     (2) the debtor does not perform an adverse judgment
Appeals mandate has issued and Texas Supreme Court                   final on appeal.
review is pending, would, in effect, have the ability to                   Texas Rule of Appellate Procedure 43.5 instructs
enforce the appealable judgment. If the judgment                     the court of appeals in affirming the trial court
debtor could not provide the additional security, the                judgment or modifying it and rendering judgment
judgment would be subject to enforcement, contrary to                against the appellant to also render judgment against
Appellate Rule 51.1(b) prohibiting enforcement of an                 the sureties on the appellant’s supersedeas bond “for
appellate judgment until the trial court clerk receives              the performance of the judgment and any costs taxed
the mandate from the appellate court, signaling that                 against the appellant.” 370       Appellate Rule 60.5,
appellate review is complete. 364 Thus, the trial court              applicable to the Supreme Court, also speaks in terms
judgment should remain the operative judgment until                  of the surety performing the entire judgment and does
the appellate process is complete and a judgment is                  not contain language limiting the surety’s obligation to
entered by the appellate court and the appellate court               the amount of the bond, deposit, or alternate security
issues its mandate requiring recognition and
enforcement of its judgment. 365
      Should a petition for review be denied, a stay of              368
                                                                        See TEX. R. APP. P. 18.2; Supreme Court Rules 18, 51(1);
mandate may be sought from the Texas Supreme Court
                                                                     28 USC § 21.01(f).
pending disposition by the United States Supreme
                                                                     369
Court on a petition for writ of certiorari. Under limited                 TEX. R. APP. P. 24.1(d) speaks in terms of conditions of
circumstances, a stay may be obtained from the United                liability that must be undertaken by the surety on “a bond,
States Supreme Court. 366 A motion to stay mandate                   any deposit in lieu of a bond, or may alternate security
                                                                     ordered by the court.” However, there will be instances
must state the grounds for the petition and the
                                                                     when no surety is involved as the party itself will post a
circumstances requiring the stay. 367 The appellate                  deposit in lieu of bond, such as cash, cashier’s check, or
court authorized to issue the mandate may grant a stay               certain negotiable instruments or even court approved
upon a determination that the “grounds are substantial               alternate security. Thus, the rule addresses conditions of
and that the petitioner or others would incur serious                liability that must be undertaken by the surety in superseding
hardship from the mandate’s issuance of the United                   judgments and is silent as to the parties’ responsibilities.
States Supreme Court were later to reverse the                       Strictly speaking, a surety is one backing up the obligation
                                                                     of another and thus a party is not and cannot be a surety to
                                                                     itself. However, the court no doubt intended that the
                                                                     conditions of liability expressed in TEX. R. APP. P. 24.1(d)
363
      TEX. R. APP. P. 51.1(b).                                       would apply to appellants when acting without a surety.
                                                                     370
364
      TEX. R. APP. P. 51.1(b).                                             TEX. R. APP. P. 43.5; Whitmire v. Greenridge Place
                                                                     Apartments, 333 S.W.3d 255, 261 (Tex. App.—Houston [1st
365
    The author is aware of one instance in which an appellate        Dist.] 2010, no pet.). (Notwithstanding the expiration of the
court ordered the modification of the appellate security             appellate court’s plenary power, that court may amend its
necessary to continue suspension of the enforcement of a             judgment to reflect the sureties’ liability on a supersedeas
judgment based upon the appellate modification of that               bond. An appellate court has a mandatory duty under TRAP
judgment. See unpublished order of Nov. 8, 2004, Harris v.           43.5 to render judgment against the sureties on the
Sterquell, No. 07-01-0071-CV, Amarillo Court of Appeals.             supersedeas bond when the court affirms the trial court’s
366                                                                  judgment. Upon affirming the trial court’s judgment,
    See TEX. R. APP. P. 18; Supreme Court Rules 18, 51(1);
                                                                     rendering judgment against the sureties is a ministerial act
28 USC § 21.01(f).
                                                                     involving no judicial discretion which thus may be corrected
367
      TEX. R. APP. P. 18.2.                                          after expiration of the court's plenary power.).
                                                                30
