Opinion
07-23-00285-CV
10-22-2024
STEVE OTOS, APPELLANT v. CHUCK BREHM, ED BECK, TOBIN CENTER HOTEL, LLC, APPELLEES
On Appeal from the 166th District Court Bexar County, Texas Trial Court No. 2019-CI-20398, Honorable Laura Salinas, Presiding
Before QUINN, C.J., and PARKER and DOSS, JJ.
ORDER ON INDIGENCY
PER CURIAM
Appellant, Steve Otos, appeals from the trial court's order finding him not indigent and denying his request for a free record on appeal. We conclude the trial court did not abuse its discretion in sustaining the contest to Appellant's affidavit of indigence.Therefore, we affirm the trial court's order.
This case was transferred to this Court from the Fourth Court of Appeals pursuant to the Supreme Court's docket equalization efforts. See TEX. GOV'T CODE ANN. § 73.001.
Background
In February 2023, the trial court rendered an amended judgment that Otos take nothing by his suit against Appellees, Chuck Brehm and Tobin Center Hotel, LLC (collectively Tobin Center) and ordered Otos to pay Tobin Center's costs of $13,020.18.Otos filed a notice of appeal; in August 2023, he filed an Amended Statement of Inability to Afford Payment of Court Costs or an Appeal Bond (Amended Statement), pursuant to Rule 145 of the Texas Rules of Civil Procedure.
Otos settled his claim against Ed Beck before a judgment was entered. Otos's claim against Beck was dismissed.
Otos's Amended Statement covered finances for a single month. It showed he was represented by counsel, received $281 in public benefits, had $3 cash, $15,875.49 in his savings/checking accounts, and owned a Toyota Camry worth $9,000. He listed his monthly expenses as $1,747.
The Amended Statement included proof of eligibility for $281 in benefits from the Supplemental Nutrition Assistance Program (SNAP), Medicaid benefits from Oregon, and participation in a low-income energy assistance program. Other than SNAP, Otos did not provide any evidence of the receipt of monetary benefits from any other government program.
His monthly expenses included: $400 for food and household supplies; $250 for utilities/phone service; $97 for insurance; $200 for transportation; $600 for child/spousal support and $200 to MasterCard. He indicated he was not paying his $2,200 house payment and was in arrears by nearly $100,000.
The court reporter and Tobin Center each challenged Otos's claim of indigency. The reporter provided evidence that Otos had retained counsel, a savings account balance of nearly $13,500, and a house valued at nearly $400,000 on the tax rolls. Tobin Center challenged Otos's claims of indigence as materially false or outdated. They cited his resume, which discussed degrees in business and psychology; sixteen years of work experience in high-end hospitality management, senior positions in banking, real estate, and business development firms engaged in multi-million-dollar loans and projects, and ownership of a commercial real estate development firm. The reporter and Tobin Center argued Otos's ability to pay for an attorney, substantial assets, and professional background belied his claim of poverty. After hearings in January 2024, the trial court rejected Otos's claim of indigency and ordered him to pay the costs of his appeal, making detailed findings of fact as required by Rule 145(f)(2).
Otos asserts the trial court failed to issue an order with detailed findings on his ability to pay costs. On May 2, 2024, the trial court issued a five-page order containing seventeen detailed findings of fact, and concluding that Tobin Center and the court reporter rebutted Otos's evidence of an inability to pay the costs of appeal.
Standard of Review
We review a trial court's indigency rulings for abused discretion. Strickland v. iHeartMedia, Inc., 668 S.W.3d 34, 37 (Tex. App.-San Antonio 2022, no pet.). The test is whether the record as a whole shows "by a preponderance of evidence that the applicant would be unable to pay the costs . . . if he really wanted to and made a goodfaith effort to do so." Higgins v. Randall Cnty. Sheriff's Off., 257 S.W.3d 684, 686 (Tex. 2008) (quoting Pinchback v. Hockless, 139 Tex. 536, 164 S.W.2d 19, 20 (Tex. [Comm'n Op.] 1942)). The trial court, as factfinder, is the sole judge of credibility and is free to resolve any inconsistencies. Iliff v. Iliff, 339 S.W.3d 74, 83 (Tex. 2011).
Analysis
In the matter before this Court, Otos solely argues Tobin Center and Bexar County failed to adduce sufficient evidence to rebut his prima facie evidence of inability to pay. See Rule 145 (d)(1). We disagree.
That Otos "receives benefits from a means-tested government entitlement program [such as SNAP]" is prima facie evidence of his inability to afford payment of costs. See Rule 145(d)(1).
The record as a whole reflects that Otos has averaged more than $30,000 in annual income from 2017 through 2023. He has timely paid his legal costs throughout the litigation and has retained counsel for trial and appeal. According to the evidence, Otos has at least a quarter million dollars in equity in his residence, and nearly $16,000 combined in checking and savings accounts. His Amended Statement did not disclose he had also recently received $47,000 from various sources.
During the hearings, Appellant valued his house at more than that estimated by the court reporter: approximately $700,000. He stated he had three mortgages, at $296,000, $81,000, and $46,000, and testified he had rejected two cash offers to purchase his house. Aside from the offers, Otos did not present any evidence that he intended to sell or mortgage the house again or use it as security for the costs. See Stephens v. Dodson, 226 S.W.2d 924, 925-26 (Tex. Civ. App.-Dallas 1950, no writ) (failure to present evidence movant made attempts to mortgage farm or use it as security for loan fails to meet burden of proof in indigency challenge).
The record also shows that Otos was not suffering from any health issues or disabilities that would prevent him from holding a full-time job. Despite his extensive background in hospitality management, commercial real estate, and finance, Otos has spurned pursuing jobs in these fields, offering various justifications that the trial court was free to reject. A party's failure to pursue available assets can evidence a lack of good faith to pay costs. See White v. Bayless, 40 S.W.3d 574, 575 (Tex. App.-San Antonio 2001, pet. denied) ("failing to pursue and use assets that could be used to provide funds for paying for appellate record evidences the opposite of a good-faith effort"); Wallgren v. Martin, 700 S.W.2d 28, 30 (Tex. App.-Dallas 1985, no pet.) (when record demonstrates party has ability to raise money through future employment, there is no abuse of discretion in sustaining contest).
Otos's testimony about government benefits was inconsistent and vague. For example, he could not recall when he applied for benefits, claiming the benefits "just continued." Moreover, Otos was unsure if he reported his current income to the agencies-a factor that is presumably relevant to his continued eligibility for benefits. He stated he only needed benefits during the COVID pandemic.
The record supports a finding that Otos possesses the ability to pay the costs of the record if he really wanted to. Accordingly, the trial court properly exercised its discretion in sustaining the contest to Otos's claim of indigence. Basaldua v. Hadden, 298 S.W.3d 238, 241 (Tex. App.-San Antonio 2009, no pet.) (per curiam). Having considered the entire record, we affirm the trial court's order.
Tobin Center filed a motion to strike certain exhibits filed by Otos that were attached as appendices to his brief and reply brief. These exhibits included emails between counsel and an "unsworn affidavit." On appeal, the appellate record consists of the clerk's record and, if necessary to the appeal, the reporter's record. TEX. R. APP. P. 34.1. Because they were not properly a part of the appellate record, the Court did not consider the appendix exhibits submitted by Otos. We therefore deny Tobin Center's motion to strike as moot.
Otos is ordered to (1) pay or arrange payment for the clerk's and reporter's records within fifteen days from the date of this opinion, and (2) file with this Court written verification of the same by the same deadline. Failure to comply may result in dismissal of Otos's appeal for want of prosecution or submission without a reporter's record. See TEX. R. APP. P. 37.3(b), (c), 42.3(b), (c).