Ferguson v. Building Materials Corp. of America (Tex. 2009),
No. 08-0589 (Tex. Jul. 3, 2009)(per curiam) (judicial estoppel based on inadvertent failure to list PI suit
as asset in bankruptcy proceeding does not apply)
JASON FERGUSON AND BOBBIE FERGUSON v. BUILDING MATERIALS CORPORATION OF
AMERICA, CPC LOGISTICS, INC., AND ROBERT JAMES MADDOX; from Dallas County;
8th district (08-07-00051-CV, 276 SW3d 45, 06-12-08 Opinion of the Eight Court of Appeals
below)
Pursuant to Texas Rule of Appellate Procedure 59.1, after granting the petition for review and without
hearing oral argument, the Court reverses the court of appeals' judgment and remands the case to the
trial court.
Per Curiam Opinion [pdf]
Electronic Briefs in Tex. 2009 No. 08-0589 FERGUSON v. BUILDING MATERIALS CORP. OF AM.
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OPINION EXCERPT:
At issue in this appeal is whether the plaintiffs in a personal injury suit should be estopped from
pursuing their claim because they initially omitted it as a listed asset in a pending bankruptcy.
The court of appeals, in a divided opinion, concluded that the doctrine of judicial estoppel
should apply and affirmed the trial court’s dismissal of the plaintiffs’ personal injury claim. 276
S.W.3d 45. The court of appeals reasoned that the doctrine applied because of the plaintiffs
failure to add the personal injury claim as an asset in their bankruptcy proceeding before the
personal-injury defendant pointed out the omission and moved for dismissal.
Because we disagree that the doctrine is invoked under the circumstances of this case, we
reverse and remand the personal injury claim to the trial court. We review a grant of
summary judgment de novo. Tex. Mun. Power Agency v. Pub. Util. Comm’n of Tex., 253 S.W.
3d 184, 192 (Tex. 2007). Because the Fergusons have taken neither a clearly inconsistent
position nor obtained an unfair advantage, the court of appeals erred in affirming the dismissal
of their personal injury claim under the doctrine of judicial estoppel.
We accordingly grant the petition for review and, without hearing oral argument, reverse the
court of appeals’ judgment and remand the case to the trial court for further proceedings. See
Tex. R. App. P. 59.1.
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Ferguson v. Building Materials Corp. of America (Tex. 2009)(per curiam)
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[Note: Hyperlinks and highlights have been added to the opinion text below. To see the opinion in its original form [in
pdf], click on the case name above).
PER CURIAM
At issue in this appeal is whether the plaintiffs in a personal injury suit should be estopped from
pursuing their claim because they initially omitted it as a listed asset in a pending bankruptcy.
The court of appeals, in a divided opinion, concluded that the doctrine of judicial estoppel
should apply and affirmed the trial court’s dismissal of the plaintiffs’ personal injury claim. 276
S.W.3d 45. The court of appeals reasoned that the doctrine applied because of the plaintiffs
failure to add the personal injury claim as an asset in their bankruptcy proceeding before the
personal-injury defendant pointed out the omission and moved for dismissal.
Because we disagree that the doctrine is invoked under the circumstances of this case, we
reverse and remand the personal injury claim to the trial court.
Jason Ferguson and his wife sued Building Materials Corporations of America and others for
injuries Ferguson suffered when an eighteen-wheeler crashed into a building, which collapsed
on him. A few months after filing the personal injury suit against Building Materials, the
Fergusons filed for bankruptcy, which required them to disclose their income, assets, and
liabilities to the bankruptcy court, the bankruptcy trustee, and their creditors. See 11 U.S.C. §
521 (a)(1)(A) & (B)(i),(ii),(iii). To comply with these disclosures, the Fergusons completed
several forms, including a Statement of Financial Affairs and a Schedule of Personal
Property. The Fergusons disclosed the pending lawsuit in the Statement of Financial Affairs,
providing the caption and style of the suit, nature of the claim, cause number, and the court in
which it had been filed. The Fergusons, however, failed to include it on their Schedule of
Personal Property.
The Fergusons also participated in a creditors meeting at which they again disclosed the
pending personal injury suit to the bankruptcy trustee. See 11 U.S.C. § 341(c). The
trustee acknowledged the existence of the pending litigation in his report, which was given to
the bankruptcy court and creditors. None of the creditors objected to the final bankruptcy
plan that failed to include the lawsuit as an asset.
Within weeks of the plan’s approval, Building Materials, the defendant in the personal injury
lawsuit, filed a motion for summary judgment, claiming the personal injury action was barred on
the basis of judicial estoppel. The trial court granted the motion, and a divided court of
appeals affirmed, reasoning that the Fergusons were judicially estopped from pursuing the
personal injury lawsuit. 276 S.W.3d at 49-52.
Judicial estoppel precludes a party who successfully maintains a position in one proceeding
from afterwards adopting a clearly inconsistent position in another proceeding to obtain an
unfair advantage. Pleasant Glade Assembly of God v. Schubert, 264 S.W.3d 1, 6 (Tex. 2008).
Accordingly, a party cannot be judicially estopped if it did not prevail in the prior action.
See Long v. Knox, 291 S.W.2d 292, 295 (Tex. 1956). The doctrine is not intended to punish
inadvertent omissions or inconsistencies but rather to prevent parties from playing fast and
loose with the judicial system for their own benefit. Pleasant Glade Assembly of God, 264 S.W.
3d at 7.
The Fergusons have neither taken a clearly inconsistent position nor gained an unfair
advantage in their bankruptcy proceeding. As the dissenting justice in the court of appeals
noted, the Fergusons never attempted to conceal the existence of the personal injury
suit. 276 S.W.3d at 54. Rather, the Fergusons listed it on their Statement of Financial Affairs
and also disclosed it to the trustee at the creditors meeting, at which time they acknowledged
the suit and directed the trustee to contact plaintiffs’ counsel if the trustee needed additional
information. And, although the Fergusons omitted it from the bankruptcy plan initially confirmed
by the court, when the omission was called to their attention, they amended their bankruptcy
plan to include its value and agreed to recalculate the amount owed to the creditors. Thus,
even assuming the existence of an inconsistent position, the Fergusons have gained no
advantage and more importantly, neither Building Materials in the pending personal injury suit
nor the creditors in the bankruptcy have suffered any disadvantage. The doctrine of judicial
estoppel simply does not apply under these circumstances. See Pleasant Glade Assembly of
God, 264 S.W.3d at 6-8.
We review a grant of summary judgment de novo. Tex. Mun. Power Agency v. Pub. Util. Comm’
n of Tex., 253 S.W.3d 184, 192 (Tex. 2007). Because the Fergusons have taken neither a
clearly inconsistent position nor obtained an unfair advantage, the court of appeals erred in
affirming the dismissal of their personal injury claim under the doctrine of judicial estoppel. We
accordingly grant the petition for review and, without hearing oral argument, reverse the court
of appeals’ judgment and remand the case to the trial court for further proceedings. See Tex.
R. App. P. 59.1.
OPINION DELIVERED: July 3, 2009
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