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Court Rules Against Trustee’s Right to a Jury Trial Where the Trustee Agreed To A Summary Proceeding

In Lavizadeh v. Moghadam, a trustee purchased real estate and then had a dispute with a guarantor. No. 05-18-00955-CV, 2019 Tex. App. LEXIS 10835 (Tex. App.—Dallas December 13, 2019, no pet. history). The trial court ruled against the trustee, and the trustee objected to the failure to have a jury trial. The trial court overruled that objection, and the trustee appealed. The court of appeals first held that the trustee waived any issue on the procedure by expressly agreeing to same:

During the hearing conducted prior to jury selection, the Trust’s counsel initially stated “for the record that we’re here on a jury trial setting” and he believed “factual issues [existed] that may need to be presented to the jury. . .”, however, he subsequently agreed to Moghadam’s counsel’s proposal to stipulate all exhibits into evidence. More specifically, the Trust agreed, “it would be appropriate” to have a “summary trial by the Judge on those issues, and then if we need a jury on a fact issue . . . “ the parties would return to court for further proceedings. Following this exchange and an off-the-record discussion, the Trust offered 18 exhibits into evidence, and the court admitted them. Moghadam’s exhibits were likewise deemed admitted at the same time although submitted electronically a few days later. We conclude the Trust’s agreement with this procedure waived any objection to the court’s refusal to submit any issues to a jury.

Id. The court also held that any failure to provide a jury trial was harmless as there were no questions of fact: “The right to a jury trial attaches only when controverted questions of fact exist.” Id.

The court then suggested that the process was similar to submission on stipulated facts. “Although we acknowledge an imperfect fit, we treat this case as having been tried on stipulated facts pursuant to rule 263.” Id. “In reviewing a judgment entered pursuant to stipulated facts, we disregard the court’s findings of fact and conclusions of law, issued here pursuant to the Trust’s post-judgment request.” Id. “We also observe rule 263’s application mandates a standard of review more favorable to the Trust than the otherwise discretionary review we would employ if we credited the findings of fact and conclusions of law issued at the Trust’s request.” Id. (citing  Addison Urban Dev. Partners, LLC, LC, 437 S.W.3d at 600-01 (de novo review of judgment issued pursuant to rule 263 procedure is less deferential than the discretionary review otherwise afforded, “because a trial court has no discretion in deciding what the law is or in properly applying it.”). Based on this procedural posture, the court of appeals affirmed the trial court’s judgment because the trial court properly interpreted the guarantee agreement and applied the undisputed facts to the parties’ agreement.

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About this Author

David Johnson Financial Litigator Winstead Law Firm

David maintains an active trial and appellate practice and has consistently worked on financial institution litigation matters throughout his career. David is the primary author of the Texas Fiduciary Litigator blog, which reports on legal cases and issues impacting the fiduciary field in Texas. 

David's financial institution experience includes (but is not limited to): breach of contract, foreclosure litigation, lender liability, receivership and injunction remedies upon default, non-recourse and other real estate lending, class...

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