Austin Nursing Center, Inc. v. Lovato, 171 S.W.3d 845 (Tex. 2005),
affirming, Lovato v.
Austin Nursing Center, Inc., 113 S.W.3d 45 (Tex. App.—Austin 2003).
Lorentz v. Dunn, 171 S.W.3d 854
(Tex. 2005), reversing,
Lorentz v. Dunn,
112 S.W.3d 176
(Tex. App.—Fort Worth 2003).
The relevant facts of these two cases are similar. Before the statute
of limitations was to run on a decedent’s negligence claim, the
plaintiff petitioned to be appointed as the decedent’s personal
representative. Before being appointed, the plaintiff filed a survival
action falsely stating that she had already been properly appointed by
the court. The plaintiff was later appointed but by that time, the
statute of limitations had already run. In both cases, the trial courts
dismissed the survival actions holding that the plaintiffs did not have
standing when they filed the cases. The plaintiffs appealed.
The appellate courts reached different results. In Austin, the court
held that the plaintiff had standing to bring the suit and that her
appointment after the statute of limitations expired related back to
filing of the original complaint which was within the statute of
limitations period. On the other hand, the Lorentz court determined that
the plaintiff lacked standing because she had not been appointed either
at the time she filed the survival action or when the statute of
limitations had run. This court held that her standing once being
appointed did not relate back to the time of filing.
The Supreme Court of Texas affirmed Austin and reversed Lorentz.
The court stressed the distinction between standing and capacity, both
of which are required before a person may properly bring a lawsuit. The
court stated, “the issue of standing focuses on whether a party has a
sufficient relationship with the lawsuit so as to have a ‘justiciable
interest’ in its outcome, whereas the issue of capacity is ‘conceived of
as a procedural issue dealing with the personal qualifications of a
party to litigate.’” Austin at ___. Standing deals with whether the
plaintiff is “personally aggrieved,” whereas capacity refers to the
“legal authority to act” even if the party has no justiciable interest.
Although the court recognized the long line of Texas cases holding that
a decedent’s estate is not a legal entity which can sue or be sued, the
court nonetheless stated that “in a survival action, the decedent’s
estate has a justiciable interest in the controversy sufficient to
confer standing.” Austin at ___. The court then reasoned that because
the estate had standing to sue, Plaintiff acquired the capacity to
assert the survival claim after she was appointed as the estate’s
personal representative. The court explained that her late-acquired
capacity cured her failure to have capacity before the statute of
limitations expired.
Surprisingly, the court was not greatly concerned about the false
statements made by the plaintiffs in their pleadings. The court merely
said the trial court has the discretion to address the
misrepresentations.
Moral: It has long been held in Texas that an estate is not a legal
entity which can sue or be sued. The Supreme Court of Texas has now made
an exception for survival actions by granting a decedent’s estate
standing to sue even though no one has been appointed as the decedent’s
personal representative. These decisions will make it easier for
lawsuits to be filed very close to the expiration of the statute of
limitations because it is not necessary for the plaintiff to secure the
prior appointment of a personal representative.