                          COURT OF APPEALS
                          SECOND DISTRICT OF TEXAS
                               FORT WORTH

                               NO. 02-12-00415-CV

JOYCE STRANGE, INDIVIDUALLY                                         APPELLANT
AND AS TRUSTEE FOR THE
JOYCE STRANGE MARITAL
TRUST

                                            V.

THE ESTATE OF W.L. “RUSTY”                                          APPELLEES
LINDEMANN, DECEASED; AND
GERALDINE T. LINDEMANN, THE
INDEPENDENT EXECUTRIX OF
SUCH ESTATE


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          FROM THE 97TH DISTRICT COURT OF ARCHER COUNTY

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                                     OPINION

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      Joyce Strange, individually and as trustee for the Joyce Strange Marital

Trust, appeals the trial court’s final summary judgment for appellees, the Estate

of W.L. “Rusty” Lindemann and the Estate’s executrix, Geraldine T. Lindemann

(collectively, the Estate). We affirm.
                                  Background

      Strange sued Rusty and his company, W.L. Lindemann Operating Co. (the

company), in 2001 claiming that they had either drained oil from beneath

properties upon which she held two oil and gas leases, failed to properly produce

her leases, or both. W.L. Lindemann Operating Co. v. Strange, 256 S.W.3d 766,

772 (Tex. App.––Fort Worth 2008, pet. denied). A jury found that

      •   substantial drainage had occurred from one of the leases;

      •   the company had failed to act as a reasonably prudent operator by
          failing to prevent the substantial drainage;

      •   the company willfully commingled oil production from Strange’s lease
          and two other leases; and

      •   the company committed fraud against Strange.

Id. at 772–73. The jury awarded Strange $709,052 for the substantial drainage,

$1,627,300 for the willful commingling, $233,300 for the fraud, and $200,000 in

exemplary damages. Id. Because Strange elected to proceed on her fraud

rather than her drainage claim, the trial court rendered a judgment for $1,860,600

plus $200,000 in exemplary damages against the company. Id. at 773.

      Although Strange obtained a verdict and judgment against the company,

the jury specifically found that Rusty had not operated the leases and did not

commit fraud against Strange.     Thus, the trial court rendered a take-nothing

judgment in Rusty’s favor. Id. Strange did not appeal that judgment. Id. The

company appealed the $2,060,600 judgment against it; we affirmed the fraud




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findings and related damages but reversed and rendered a take-nothing

judgment on the willful commingling claim. Id. at 788.

      On May 18, 2009, after this court’s judgment in the company’s appeal was

final, Strange sued Rusty, claiming that after the trial court rendered the

judgment against the company in Strange’s favor, it became apparent to Strange

that the company “had always been undercapitalized . . . and had never had

sufficient assets to fund its operations.” Strange also alleged that the company

“was organized and operated as a mere tool or business conduit of [Rusty] and

was [his] alter ego.”      Thus, she sought to collect the judgment against the

company from Rusty by piercing the corporate veil, alleging (1) that he had used

the company as a sham to perpetuate a fraud, (2) that the company was his alter

ego, (3) that he used the company to evade legal obligations, (4) that he kept the

company inadequately capitalized, and (5) that he committed actual fraud. Rusty

filed a general denial and raised as an affirmative defense that the suit is a

collateral attack on the take-nothing judgment in his favor and, thus, is barred by

res judicata.

      Rusty died after the second suit was filed, and the trial court granted a writ

of scire facias allowing the suit to go forward against the Estate. The Estate

answered and also raised the affirmative defense of res judicata and improper

collateral attack on the take-nothing judgment, as well as collateral estoppel,

limitations, and laches.




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      Strange filed a traditional motion for summary judgment claiming that she

conclusively proved that the company was a sham and merely an alter ego for

Rusty.   The Estate then filed both traditional and no-evidence motions for

summary judgment. The Estate alleged eighteen different elements for which it

contended Strange could produce no evidence. The traditional motion claimed

that the Estate could conclusively prove its affirmative defense of res judicata.

      After granting most of the Estate’s objections to Strange’s summary

judgment evidence, and considering only the two traditional motions for summary

judgment and responses, the trial court denied Strange’s motion and granted the

Estate’s. Strange then appealed to this court.

                Propriety of Summary Judgment for the Estate

      In two issues, Strange argues that the trial court erred by granting

summary judgment for the Estate and by denying her motion for summary

judgment.

Standard of Review

      We review a summary judgment de novo. Travelers Ins. Co. v. Joachim,

315 S.W.3d 860, 862 (Tex. 2010). We consider the evidence presented in the

light most favorable to the nonmovant, crediting evidence favorable to the

nonmovant if reasonable jurors could, and disregarding evidence contrary to the

nonmovant unless reasonable jurors could not. Mann Frankfort Stein & Lipp

Advisors, Inc. v. Fielding, 289 S.W.3d 844, 848 (Tex. 2009). We indulge every

reasonable inference and resolve any doubts in the nonmovant’s favor. 20801,


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Inc. v. Parker, 249 S.W.3d 392, 399 (Tex. 2008).           A plaintiff is entitled to

summary judgment on a cause of action if it conclusively proves all essential

elements of the claim. See Tex. R. Civ. P. 166a(a), (c); MMP, Ltd. v. Jones, 710

S.W.2d 59, 60 (Tex. 1986). A defendant is entitled to summary judgment on an

affirmative defense if the defendant conclusively proves all the elements of the

affirmative defense. Frost Nat’l Bank v. Fernandez, 315 S.W.3d 494, 508–09

(Tex. 2010); see Tex. R. Civ. P. 166a(b), (c). To accomplish this, the defendant-

movant must present summary judgment evidence that conclusively establishes

each element of the affirmative defense. See Chau v. Riddle, 254 S.W.3d 453,

455 (Tex. 2008).

Analysis

      The Estate argues primarily that of the five veil-piercing theories pled by

Strange, only the actual fraud theory is available to her, and because the jury in

the first suit found that Rusty had not committed fraud, her attempt to enforce the

judgment against the company is, in effect, an impermissible collateral attack on

the take-nothing judgment in Rusty’s favor that is barred by res judicata.

      Section 21.223 of the Business Organizations Code provides that a

corporation’s shareholder may not be held liable to the corporation’s obligees for

“any contractual obligation of the corporation or any matter relating to or arising

from the obligation on the basis that the holder . . . is or was the alter ego of the

corporation or on the basis of actual or constructive fraud, a sham to perpetrate a

fraud, or other similar theory [or] the failure of the corporation to observe any


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corporate formality” unless the holder “caused the corporation to be used for the

purpose of perpetrating and did perpetrate an actual fraud on the obligee

primarily for the direct personal benefit of the holder.” Tex. Bus. Orgs. Code Ann.

§ 21.223 (West 2012) (emphasis added).           The actual fraud exception is

“exclusive and preempts any other liability imposed for that obligation under

common law or otherwise.” Id. § 21.224. Thus, Strange could obtain a judgment

against Rusty in this veil-piercing suit only by proving that Rusty himself

committed an actual fraud against Strange. 1 See Willis v. Donnelly, 199 S.W.3d

262, 272–73 (Tex. 2006).

      Typically, a postjudgment suit against an alleged alter ego is not a

collateral attack on the prior judgment, and thus is not barred by res judicata.

See, e.g., Matthews Constr. Co. v. Rosen, 796 S.W.2d 692, 694 (Tex. 1990).

But this veil-piercing suit is distinguishable because Rusty, a shareholder, was a

party to the prior suit, obtained a jury finding that he had not committed fraud in

connection with the allegations arising from the company’s operation of Strange’s

lease, and also obtained a take-nothing judgment in his favor based in part on

that finding. See Partee v. Phelps, 840 S.W.2d 512, 514–15 (Tex. App.––Dallas

1992, no writ) (holding that res judicata barred subsequent suit against individual

      1
       The caselaw upon which Strange relies to argue that section 21.223 does
not exclude other theories of liability, such as alter ego and sham to perpetuate a
fraud, predates January 1, 2006, the effective date of the 2003 amendments to
the statute. See Tex. Bus. Orgs. Code Ann. § 1.002(20) (West 2012); Act of May
13, 2003, 78th Leg., R.S., ch. 182, § 1, sec. 1.002(20), § 17, 2003 Tex. Gen.
Laws 267, 304, 597.


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partners for enforcement of judgment against partnership when individual

partners were parties to first suit but judgment against them for joint and several

liability of partnership debt was reversed on appeal because of their limitations

defense). The question we must answer, then, is whether the claim for actual

fraud in this veil-piercing suit is therefore barred by res judicata.

         Res judicata bars a second suit between the same parties to a final

judgment if the second suit is based on the same claims that were raised or

could have been raised in the first action. Amstadt v. U.S. Brass Corp., 919

S.W.2d 644, 652 (Tex. 1996). For res judicata to apply to a claim, that claim

must have been in existence when the first suit was filed. In re D.W.G., 391

S.W.3d 154, 167 (Tex. App.––San Antonio 2012, no pet.); Hernandez v. Del Ray

Chem. Int’l, Inc., 56 S.W.3d 112, 116 (Tex. App.––Houston [14th Dist.] 2001, no

pet.).

         As summary judgment evidence, the Estate presented, among other

things, the original and fourth amended petition in the first suit, the jury charge in

the first suit, the two judgments in the first suit, this court’s opinion and judgment

in the company’s appeal of the judgment against it, and the original petition in

this veil-piercing suit. This court’s opinion in the company’s appeal details the

evidence and allegations in the first suit: we held that the evidence was sufficient

to uphold the finding of fraud against the company based primarily on evidence

of Rusty’s acts and omissions. W.L. Lindemann Operating Co., 256 S.W.3d at

776–80. Nevertheless, when asked whether Rusty or the company operated


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Strange’s lease, the jury answered that the company and not Rusty was the

operator. And when asked whether Rusty or the company committed fraud, the

jury answered that the company did but Rusty did not. Id. at 773. These are the

ultimate findings upon which the trial court’s take-nothing judgment for Rusty was

based.   In her petition in this veil-piercing suit, Strange alleged as follows

regarding actual fraud:

      The Charge of the Court in the previous lawsuit, Jury Question 15,
      specifically asked if [the company] committed fraud against
      [Strange], to which the jury answered, “YES.” . . . As such, it is
      indisputable that the corporation committed actual fraud upon
      [Strange], and the corporate veil should be pierced and [Rusty]
      should be held individually liable.

Thus, Strange’s fraud allegation in this veil-piercing suit is based on the same

facts alleged and tried in the first suit. As such, it is a collateral attack on the

take-nothing judgment for Rusty rather than merely an attempt to enforce the

judgment against the company.

      We conclude and hold that the Estate conclusively proved as a matter of

law its affirmative defense that Strange’s veil-piercing claim is barred by res

judicata and that the trial court did not therefore err by granting the Estate’s

motion for summary judgment on that affirmative defense. See In re Staley, 320

S.W.3d 490, 504–05 (Tex. App.––Dallas 2010, no pet.); Partee, 840 S.W.2d at

514–15; cf. Willis, 199 S.W.3d at 271–73 (holding that shareholder could not be

held liable for corporation’s contractual obligation because narrow exceptions to

section 21.223 had not been proven as jury had rejected fraud claim at trial);



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Shook v. Walden, 368 S.W.3d 604, 622 (Tex. App.––Austin 2012, pet. denied)

(holding that member and manager of limited liability company could not be held

liable for company’s obligations when jury’s finding that he did not commit fraud

was unchallenged and unsupported by evidence).               Because the Estate’s

affirmative defense applies to all of Strange’s claims, the trial court did not err by

denying her summary judgment contending that she conclusively proved her

claims against the Estate. See Staley, 320 S.W.3d at 503–04 & n.7; Cox v.

Waste Mgmt. of Tex., Inc., 300 S.W.3d 424, 437 n.15 (Tex. App.––Fort Worth

2009, pet. denied). We overrule Strange’s first and second issues.

                                    Conclusion

      Having overruled both of Strange’s issues, we affirm the trial court’s

judgment.




                                              TERRIE LIVINGSTON
                                              CHIEF JUSTICE

PANEL: LIVINGSTON, C.J.; WALKER and MCCOY, JJ.

DELIVERED: August 8, 2013




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