On November 13, 2012, the Texas Supreme Court adopted rules to implement the 2011 legislation creating a right to seek early dismissal and mandating expedited handling of cases worth less than $100,000 in monetary relief. The Court added Rule 91a and Rule 169 to the Texas Rules of Civil Procedure, declaring: “These rules are a significant effort to improve the efficiency of the Texas court system while protecting the rights of litigants.” These new rules are open to public comment until February 1, 2013, and go into effect on March 1, 2013.

New Early Dismissal Rule

Rule 91a, Dismissal of Baseless Causes of Action, is intended to enable a party to seek dismissal of a claim having no basis in law or fact. The new rule has key timing aspects. The movant must file its dismissal motion within 60 days after the first pleading containing the challenged claim is served on the movant. The movant must give 21 days' notice of hearing, and the trial court must rule on the motion within 45 days after it is filed. Except in limited circumstances concerning governmental claims, a court must award the “prevailing party” (either a defendant or a plaintiff) all costs and reasonable and necessary attorney’s fees incurred with respect to the challenged claim.

The court is not to consider evidence, except that which is attached to a petition or answer. In this way, the motion is similar to the federal Rule 12(b)(6), with the addition that the party who loses pays the other party’s reasonable fees and costs.

Another important shift in Texas procedure is the effect on the due order of pleadings. A defendant can file a Rule 91a motion before filing a personal jurisdiction challenge (called a “special appearance”), and not risk waiving jurisdiction by appearing in the trial court on the dismissal motion. Given the early time frame for filing a Rule 91a motion and the mandatory “loser pays” aspect, defense counsel should skillfully and promptly evaluate the claims, defenses and the trial judge to advise whether to take advantage of this new rule.

New Expedited Actions

In another sweeping change, the Court mandated that actions seeking less than $100,000 in strictly monetary relief be automatically categorized as “expedited actions.” Parties may ask to be excused from the required categorization for good cause or by pleading more than $100,000 in monetary relief.

The Court amended Rule 47 to require that a pleading be assigned to one of five monetary categories:

  1. Only monetary relief of $100,000 or less, including damages of any kind, penalties, costs, expenses, pre-judgment interest and attorney’s fees
  2. Monetary relief of $100,000 or less and non-monetary relief
  3. Monetary relief of more than $100,000, but not more than $500,000
  4. Monetary relief of more than $500,000 but not more than $1,000,000
  5. Monetary relief of more than $1,000,000.

A party that fails to comply with the above-referenced requirement may not conduct discovery until the party’s pleading is amended to state one of these categories. This new requirement should also help reduce the uncertainty about whether a lawsuit seeks more than $75,000 for federal removal purposes.

Discovery in expedited actions is governed by newly modified Rule 190.2, under which the discovery period begins when the suit is filed and continues until 180 days after the date the first request of discovery of any kind is served on a party. Parties are limited to serving no more than 15 written interrogatories, 15 requests for production and 15 requests for admissions. In addition, parties may request disclosure of all documents, electronic information and tangible items that the disclosing party has in its possession, custody or control and may use to support its claims or defenses.

Trial settings and procedures are also significantly impacted. Upon any party’s request, the court must set the case for a trial date within 90 days after the discovery period in Rule 190.2(b)(1) ends. At trial, each side is allowed five hours to present their entire case, from jury selection to closing arguments, excluding time spent on objections, bench conferences and challenges for cause to a juror. Further, unless the parties have agreed to engage in alternative dispute resolution or are required to do so by contract, the court must not require the parties to engage in alternative dispute resolution.

Unless altered by public comments, starting March 2013, all Texas lawyers and judges will confront significant new rules that will apply to all cases. If you are interested in suggesting changes, please contact us to discuss how we can help provide a voice to your suggestions.