                                                                                           ACCEPTED
                                                                                    04-014-00494-CV
                                                                           FOURTH COURT OF APPEALS
                                                                                SAN ANTONIO, TEXAS
                                                                                 3/26/2015 1:53:23 PM
                                                                                        KEITH HOTTLE
                            NO. 04-14-00494-CV                                                 CLERK



                    IN THE FOURTH COURT OF APPEALS
                          SAN ANTONIO, TEXAS                        FILED IN
                                                             4th COURT OF APPEALS
                 United Parcel Service, Inc. and   Roland Leal,SAN ANTONIO, TEXAS
                                                             3/26/2015 1:53:23 PM
                                                                KEITH E. HOTTLE
                                                     Appellants/Cross-Appellees,
                                                                     Clerk
                                      v.
Robert Scott Rankin, Individually, Rachelle Rankin, Individually and As Next
Friend for Avery Rankin, a Minor, As Next Friend for Kara Rankin, a Minor
              and As Next Friend for Samuel Rankin, a Minor
                                                     Appellees/Cross-Appellants.
     On Appeal from the 224th Judicial District Court, Bexar County, Texas
                  Honorable Cathy Stryker, Presiding Judge
                   Trial Court Cause No. 2011-CI-07922

       CROSS-APPELLEES’ REPLY TO NEW ARGUMENT IN
CROSS-APPELLANTS’ REPLY BRIEF THAT RULE 167.4(A) IS INVALID.
           W. Randall Bassett                        Ricardo R. Reyna
         Admitted Pro Hac Vice                    State Bar No. 16794845
            Bradley W. Pratt                         Audrey A. Haake
         Admitted Pro Hac Vice                    State Bar No. 08658100
         King & Spalding, LLP                 Brock Person Guerra Reyna, P.C.
       1180 Peachtree Street, N.E.                  17339 Redland Road
        Atlanta, GA 30309-3521                San Antonio, Texas 78247-2302
       Telephone: (404) 572-4600                Telephone: (210) 979-0100
       Facsimile: (404) 572-5100                 Facsimile: (210) 979-7810
          rbassett@kslaw.com
           bpratt@kslaw.com

            H. Victor Thomas
        State Bar No. 19851500
        Thomas Michael Gutting
        State Bar No. 24067640
         King & Spalding, LLP
       1100 Louisiana, Suite 4000
         Houston, Texas 77002
       Telephone: (713) 751-3200
         vthomas@kslaw.com
          tgutting@kslaw.com

  Counsel for Cross-Appellees United Parcel Service, Inc. and Roland Leal
                                  ARGUMENT
      In their Reply Brief, Cross-Appellants present a new argument that Cross-
Appellees have not had an opportunity to respond to. Namely, that Rule 167.4(a) of
the Texas Rules of Civil Procedure is invalid and unenforceable because it allegedly
irreconcilably conflicts with Chapter 42 of the Civil Practices and Remedies Code.
See Cross-Appellants’ Reply at 7. Thus, Plaintiffs argue the trial court should have
awarded them fees and costs for a potential, but not-yet-filed, appeal. As shown
below, that argument is without merit.
      A. Rule 167.4(a) does not conflict with Chapter 42, but rather
         implements or supplements it.

      Tex. Civ. Prac. & Rem. Code § 42.004(c) provides that “[t]he litigation costs
that may be recovered by the offering party under this section are limited to those
litigation costs incurred by the offering party after the date the rejecting party
rejected the settlement offer.”
      Tex. Civ. Prac. & Rem. Code § 42.001(5) further provides: “Litigation costs
means money actually spent and obligations actually incurred that are directly
related to the action in which a settlement offer is made.” (emphasis added).
      Tex. R. Civ. P. 167.4(a) provides: “. . . the court must award the offeror
litigation costs against the offeree from the time the offer was rejected to the time
of judgment.” (emphasis added).
      Plaintiffs argue that § 42.004(c) and Rule 167.4(a) conflict because Rule
167.4(a) prohibits the award of fees incurred after the time of judgment and §
42.004(c) does not. Plaintiffs further argue that in cases of conflict, the statute
controls over the rule, and therefore, if Rule 167.4(a) prohibits the award of




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appellate attorney’s fees because such fees are incurred after the judgment, then
Rule 167.4(a) is invalid.
      There is, in fact, no actual conflict between § 42.004(c) and Rule 167.4(a)
because they are easily harmonized. It is well-established that when a conflict
arises between a statute and a rule of procedure, the court must harmonize the
statute and the rule if possible. M.R.R. v. State, 903 S.W.2d 49, 51 (Tex. App.—
San Antonio 1995, no writ) (citing La Sara Grain Co. v. First Nat’l Bank of
Mercedes, 673 S.W.2d 558, 565 (Tex. 1984)).
      When the legislature passed § 42.004(c), it specifically authorized the
supreme court to promulgate procedural rules to implement Chapter 42 of the Civil
Practice and Remedies Code. Tex. Civ. Prac. & Rem. Code § 42.005(a). It further
authorized the supreme court to “address other matters considered necessary by the
supreme court to the implementation of this chapter.” Tex. Civ. Prac. & Rem.
Code § 42.005(d)(2). (emphasis added).        Thus, § 42.005(d)(2) authorized the
supreme court to even address matters that are not expressly mentioned in Chapter
42.
      There is no conflict between § 42.004(c) and Rule 167.4(a) because nowhere
does § 42.004(c) state that costs incurred after the time of judgment, such as
attorney’s fees for an appeal, must be awarded. To the contrary, Chapter 42
defines “litigation costs” to preclude an award of attorney’s fees for a potential
appeal. “Litigation costs means money actually spent and obligations actually
incurred that are directly related to the action in which a settlement offer is made.”
Tex. Civ. Prac. & Rem. Code § 42.001(5). (emphasis added). This definition
precludes the award of attorney’s fees for a potential appeal because any such fees



                                          2
have not been actually spent or incurred. Accordingly, the supreme court issued
Rule 167.4(a) to implement the requirement of § 42.001(5) that only costs
“actually spent” may be awarded. Rule 167.4(a) implements this requirement by
defining the litigation costs that must be awarded as those “from the time the offer
was rejected to the time of judgment,.” This definition precludes an award of
attorney’s fees for a potential appeal because such fees would be incurred after the
judgment.   There is no irreconcilable conflict because § 42.004(c) and Rule
167.4(a) are harmonized simply by interpreting Rule 167.4(a) as implementing §
42.001(5)’s requirement that only costs actually spent or incurred may be awarded.
      But even if Chapter 42 was completely silent on whether costs must actually
be incurred, there would be no conflict with Rule 167. This Court and others have
recognized that no conflict exists between a rule of procedure and a statute, when
the rule addresses an issue and the statute is silent on that same issue. See
Carpinteyro v. Gomez, 403 S.W.3d 508, 511 (Tex. App.—San Antonio 2013, pet.
denied) (holding no conflict between § 74.351(a) of the Texas Civil Practice and
Remedies Code, which requires a claimant to serve an expert report not later than
the 120th day after the original petition is filed, and Rule 4 of the Texas Rules of
Civil Procedure because the statute does not address how to compute the 120 day
time period); In re Anderson Constr. Co., 338 S.W.3d 190, 196 (Tex. App.—
Beaumont 2011, orig. proceeding) (holding there was no conflict between the rule
of civil procedure permitting parties to amend their pleadings to add new claims
and section 27.004 of the Texas Property Code when the statute did not address
amending pleadings to add new claims); Durish v. Dancer, 819 S.W.2d 258, 264
(Tex. App.—Austin 1991, writ denied) (holding that “[t]he Guaranty Act is silent



                                         3
as to the payment of post-judgment interest; therefore, it cannot be said to conflict
with the statute allowing for the payment of post-judgment interest”). See also
Shepard Well Drilling Co. v. St. Louis County, 912 S.W.2d 606, 609 (Mo. Ct. App.
1995) (upholding validity of ordinance because it merely supplements, rather than
contradicted, the statute); Babb v. Missouri Public Service Com’n, 414 S.W.3d 64
(Mo. Ct. App. W.D. 2013) (same).
      Moreover, Texas courts have been reluctant to find a conflict between a
Texas statute and a Texas rule implementing that statute. For example, in In re
CompleteRx, Ltd., 366 S.W.3d 318, 324 (Tex. App.—Tyler 2012, no pet.), the
court rejected an argument (different than the one made here) that Rule 167
conflicts with Chapter 42. See also M.R.R. v. State, 903 S.W.2d 49, 52 (Tex.
App.—San Antonio 1995, no pet.) (harmonizing statute and rule where statute
required appellate court to consider statement of facts and rule of procedure
prohibited court from considering late statement of facts absent timely motion for
extension); In re United Services Auto. Ass’n, 307 S.W.3d 299, 311 (Tex. 2010)
(finding no conflict between two statutes—one that creates a limitations period and
a second that tolls it, because “there is no reason, absent clear legislative intent,
that we should not harmonize the two.”).
      There is no conflict between Rule 167.4(a) and Chapter 42, and this Court
should interpret Rule 167.4(a) as implementing or supplementing Chapter 42. It
should construe Rule 167.4(a) according to its literal terms, which limits the award
of costs up “until the time of judgment.” Under existing Texas law, the trial court
correctly applied Rule 167.4(a) and did not err in denying Plaintiffs their attorney’s




                                           4
fees for a potential appeal because such costs had not yet been incurred, which is
exactly what both section 42.001(5) and Rule 167.4(a) required.

                                     Respectfully submitted,

                                     KING & SPALDING LLP



                                     By: /s/ H. Victor Thomas
                                     W. Randall Bassett
                                     Admitted Pro Hac Vice
                                     Bradley W. Pratt
                                     Admitted Pro Hac Vice
                                     King & Spalding, LLP
                                     1180 Peachtree Street, N.E.
                                     Atlanta, Georgia 30309
                                     Telephone: (404) 572-4600
                                     Facsimile: (404) 572-5100
                                     H. Victor Thomas
                                     Texas Bar No. 19851500
                                     Thomas Michael Gutting
                                     Texas Bar No. 24067640
                                     King & Spalding, LLP
                                     1100 Louisiana, Suite 4000
                                     Houston, Texas 77002-5213
                                     Telephone: (713) 751-3200
                                     Facsimile: (713) 751-3290

                                     and




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                                         Ricardo R. Reyna
                                         State Bar No. 16794845
                                         Audrey A. Haake
                                         State Bar No. 08658100
                                         BROCK PERSON GUERRA REYNA, P.C.
                                         17339 Redland Road
                                         San Antonio, Texas 78247-2302
                                         Telephone: (210) 979-0100
                                         Facsimile: (210) 979-7810

                                         Counsel for Cross-Appellees,
                                         United Parcel Service, Inc. and
                                         Roland Leal


                 CERTIFICATE OF FILING AND SERVICE
      I certify that on March 26, 2015, I used the Court’s electronic case filing

system to file this Cross-Appellees’ Reply to New Argument in Cross-Appellants’

Reply Brief and to serve this document on the counsel for appellees:

      Doug Perrin
      Mark Perrin
      The Perrin Law Firm
      325 N. Saint Paul St., Suite 600
      Dallas, TX 75201-3828

      Peter D. Marketos
      Reese Gordon Marketos LLP
      750 N. Saint Paul St., Suite 610
      Dallas, Texas 75201



                                         /s/ H. Victor Thomas
                                         H. Victor Thomas




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