Roseanna Barrera v. Chererco, LLC

Rosanna Barrera, Jenesey Barrera, and Andrea Perez appeal the trial court’s judgment in favor of Chererco, LLC, contending the trial court erred by: (1) concluding their claims relating to the title to certain real property were barred by limitations; (2) concluding they failed to raise a fact issue on their adverse possession claim; and (3) entering a final judgment in the absence of an interested party. We affirm the trial court’s judgment.

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BACKGROUND

On January 5, 2001, Diana and Jose Moreno executed a special warranty deed conveying

a tract of land in Guadalupe County, Texas (the “Property”) to Esequiel Kelly Barrera. At the time

of the conveyance, Barrera was married to Mary Angela Barrera.

In May of 2009, the San Marcos Consolidated Independent School District (“SMCIDS”)

sued Esequiel to recover delinquent ad valorem taxes. Esequiel was personally served with citation

in the lawsuit, however, Mary Angela, whose name did not appear on the special warranty deed,

was not given notice. The County of Guadalupe intervened in the lawsuit alleging it also was

owed delinquent taxes. On June 7, 2010, the trial court signed a judgment awarding a personal

money judgment against Esequiel and authorizing an order of sale for the Property. On October

4, 2010, the trial court clerk issued the order of sale. In November of 2010, the sheriff sold the

Property and executed a Sheriff’s Tax Deed conveying the Property to SMCISD, which was

recorded on November 19, 2010. On December 10, 2012, SMCISD executed a Tax Resale Deed

conveying the Property to Chererco.

On June 16, 2014, two of Mary Angela’s five adult children filed the underlying lawsuit

against Chererco to set aside the sale.1 A third adult child was added as a plaintiff in an amended

petition, and Chererco filed a third-party petition against a fourth adult child. The fifth adult child,

Dustin Poole, was never brought into the suit as a plaintiff or third-party defendant.

Chererco filed a traditional and no evidence motion for summary judgment asserting

numerous grounds. On October 19, 2015, the trial court signed an order granting the motion and

specifically found the adult children’s claims were barred by limitations. The order did not,

1 Mary Angela passed away on January 30, 2012. Although an affidavit of heirship was filed in the county clerk’s

records listing five children as Mary Angela’s children, no probate proceeding was filed.

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however, dispose of Chererco’s claim for attorney’s fees. On March 11, 2016, the trial court signed

a final judgment after Chererco withdrew its claim for attorney’s fees, and this appeal ensued.

STANDARD OF REVIEW

We review a summary judgment de novo. Katy Venture, Ltd. v. Cremona Bistro Corp.,

469 S.W.3d 160, 163 (Tex. 2015). To prevail on a traditional motion for summary judgment, the

movant must show “there is no genuine issue as to any material fact and the [movant] is entitled

to judgment as a matter of law.” TEX. R. CIV. P. 166a(c). A trial court must grant a no-evidence

motion for summary judgment unless the nonmovant produces some evidence raising a genuine

issue of material fact on each element of the nonmovant’s claims challenged in the motion. KCM

Fin. LLC v. Bradshaw, 457 S.W.3d 70, 79 (Tex. 2015). We take as true all evidence favorable to

the nonmovant, resolve all conflicts in the evidence in the non-movant’s favor, and indulge every

reasonable inference and resolve any doubts in the nonmovant’s favor. Katy Venture, Ltd., 469

S.W.3d at 163.

LIMITATIONS

In their first issue, appellants contend the trial court erred in granting summary judgment

in favor of Chererco based on limitations.

Section 33.54 of the Texas Tax Code contains the limitations provision in question and

states:

(a) Except as provided by Subsection (b), an action relating to the title to

property may not be maintained against the purchaser of the property at a tax sale

unless the action is commenced:

(1) before the first anniversary of the date that the deed executed to the

purchaser at the tax sale is filed of record; or

(2) before the second anniversary of the date that the deed executed to the

purchaser is filed of record, if on the date that the suit to collect the delinquent tax

was filed the property was:

(A) the residence homestead of the owner; or

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(B) land appraised or eligible to be appraised under Subchapter C or

D, Chapter 23.

(b) If a person other than the purchaser at the tax sale or the person’s

successor in interest pays taxes on the property during the applicable limitations

period and until the commencement of an action challenging the validity of the tax

sale and that person was not served citation in the suit to foreclose the tax lien, that

limitations period does not apply to that person.

(c) When actions are barred by this section, the purchaser at the tax sale or

the purchaser’s successor in interest has full title to the property, precluding all

other claims.

TEX. TAX CODE ANN. § 33.54 (West 2015). Although acknowledging the limitations provision

applies to tax sale challenges, appellants argue the limitations period is not applicable in this case

because Mary Angela was not served in the lawsuit authorizing the tax sale. In support of this

argument, the appellants primarily rely on this court’s decision in Sec. State Bank & Trust v. Bexar

Cty., 397 S.W.3d 715 (Tex. App.—San Antonio 2012, pet. denied). Sec. State Bank & Trust,

however, involved a claim by a record lienholder, making it distinguishable from the instant case

which is based on the claim of a purported owner. See id. at 724.

Texas courts have drawn a distinction in the application of the section 33.54 limitations

provision when the tax sale is challenged by a record lienholder as opposed to a purported owner.

See Am. Homeowner Pres. Fund, LP v. Pirkle, 475 S.W.3d 507, 514-15 (Tex. App.—Fort Worth

2015, pet. denied) (noting distinction); Sec. State Bank & Trust , 397 S.W.3d at 724 (distinguishing

cases that did not involve a record lienholder with a prior lien against the property). As the Fort

Worth court explained:

The distinction between a purported owner and a record lienholder becomes

significant in the context of tax-sale challenges because of the application of the tax

code’s tolling provision as to limitations. The tax code provides that the one-year

limitation for challenging a tax sale can be tolled by a party who continues to pay

taxes on the property up until the party’s challenge is made. As upheld by our sister

court, the requirement that a property owner challenge the tax sale within the oneyear

time limit or, in the alternative, continue to pay property taxes, which tolls

limitations, is not unreasonable. W.L. Pickens Grandchildren’s Joint Venture v.

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DOH Oil Co., 281 S.W.3d 116, 121 (Tex. App.—El Paso 2008, pet. denied). After

all, even if a property owner is unaware of the foreclosure, he or she should continue

to pay property taxes. Id. This explains why—regardless of whether he or she is

named and served with citation in a tax suit—the tax code does not work to deny

an owner the opportunity to challenge the tax sale. See id.; see also John K.

Harrison Holdings, LLC v. Strauss, 221 S.W.3d 785, 789 (Tex. App.—Beaumont

2007, pet. denied) (“It is reasonable to expect one claiming an ownership in

property to pay the taxes on the property to avoid the limitations bar.”).

This rationale does not necessarily hold true for lienholders, however. A

lienholder, who is not ordinarily liable for payment of taxes on the property, would

not be in the same position as an owner who, perhaps unwittingly, tolls the

limitations period simply by carrying on in the normal course through the payment

of property taxes as they become due. In recognition of this distinction, the court

in Security State Bank rejected the notion that the bank in that case, which was a

lienholder “at the time the delinquent tax suit was filed” rather than a property

owner, was precluded from collaterally attacking the tax sale, independent of the

tax code provisions. 397 S.W.3d at 721–25. Under the facts of Security State Bank

and the cases Security State Bank cites in support of its holding, the lienholder

received no notice of the lawsuit and had no opportunity to toll limitations through

payment of property taxes. Id.

Am. Homeowner Pres. Fund, LP, 475 S.W.3d at 514-15.

In this case, the appellants challenge the tax sale based on the failure to serve Mary Angela,

who they contend is a purported owner, with citation in the tax suit. In order to toll the running of

the limitations period, however, Mary Angela or her heirs as her successors in interest were

required to pay property taxes within the applicable limitations period. See TEX. TAX CODE ANN.

§ 33.54(b). Because Mary Angela and her heirs failed to pay any such property taxes, limitations

was not tolled, and appellants’ claims to the Property are barred.2 See Am. Homeowner Pres.

Fund, L.P., 475 S.W.3d at 514-15; W.L. Pickens Grandchildren’s Joint Venture, 281 S.W.3d at

121; John K. Harrison Holdings, LLC, 221 S.W.3d at 789. Therefore, the trial court did not err in

granting summary judgment in favor of Chererco based on limitations.

2 These claims include the appellants’ claim to title or to a right of redemption.

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ADVERSE POSSESSION CLAIM

The appellants contend the limitations provision in section 33.54 does not apply to their

adverse possession claim because they are claiming they adversely possessed the Property after

the tax sale under the three-year adverse possession statute. In order to prove adverse possession

under the three-year statute, however, the appellants were required to show they held the Property

“under title or color of title.” TEX. CIV. PRAC. & REM. CODE ANN. § 16.024 (West 2002). The

appellants did not present any evidence raising a material issue of fact as to this element of their

claim because they could not claim title or color of title after the Sheriff’s Tax Deed was recorded

and the one-year or two-year limitations period expired. See TEX. TAX CODE ANN. § 33.54(c)

(“When actions are barred by this section, the purchaser at the tax sale or the purchaser’s successor

in interest has full title to the property, precluding all other claims.”).

NON-JOINDER OF FIFTH ADULT CHILD

In their final issue, appellants contend the trial court erred in granting summary judgment

because Mary Angela’s fifth adult child, Dustin Poole, was not joined as a party to the lawsuit.

The appellants cite section 37.006(a) of the Declaratory Judgments Act which provides: “When

declaratory relief is sought, all persons who have or claim an interest that would be affected by the

declaration must be made parties.” TEX. CIV. PRAC.&REM. CODE ANN. § 37.006(a) (West 2015).

Because Dustin Poole had an interest in the Property as one of Mary Angela’s purported heirs, the

appellants contend he had to be joined as a party before the trial court could enter a final judgment.

The failure to join a person whose interests could be affected by the trial court’s judgment

or declaration does not deprive a trial court of jurisdiction. Brooks v. Northglen Ass’n, 141 S.W.3d

158, 162 (Tex. 2004); Kellner v. Kellner, 419 S.W.3d 541, 545 (Tex. App.—San Antonio 2013,

pet. denied). Instead, it raises the question of whether the trial court should have refused to enter

a judgment or declaration in that person’s absence. Brooks, 141 S.W.3d at 162; Kellner, 419

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S.W.3d at 545. In determining whether to proceed in the absence of such a person, the trial court

should consider: (1) whether complete relief can be granted in the person’s absence; and (2)

whether the judgment or declaration would either: (a) impair or impede the absent person’s ability

to protect his interest; or (b) leave any party subject to a substantial risk of incurring inconsistent

obligations. Brooks, 141 S.W.3d at 162-63; TEX. R. CIV. P. 39(a).

In this case, nothing precluded the trial court from granting complete relief among the

parties to the lawsuit, and the trial court’s judgment represents a final and complete adjudication

of their rights. See Brooks, 141 S.W.3d at 162. In addition, section 37.006(a) of the Act expressly

states, “[a] declaration does not prejudice the rights of a person not a party to the proceeding.”

TEX. CIV. PRAC. & REM. CODE ANN. § 37.006(a); see also Brooks, 141 S.W.3d at 163 (noting

section 37.006(a) dispenses with any concern that the declaration would impair or impede the

absent person’s interest). Finally, Chererco elected not to join Dustin Poole as a third-party

defendant, indicating its lack of concern with the possibility of inconsistent obligations. Therefore,

the trial court did not err in proceeding to judgment in Dustin Poole’s absence.

The trial court’s judgment is affirmed.