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In both situations, there is no holder of abandoned property. As we shall explain more fully, property that goes unclaimed for three years may be presumed abandoned and must then be delivered to the Comptroller to hold for the owner. The Unclaimed Property Act protects the property rights of identifiable owners whose property cannot be delivered or returned because the owner cannot be found.
While I agree that the class representative exercised authority over the class claims and was authorized to settle, its authority did not extend to the subsequent disposition of the settlement checks, which are the individual class members' property rights created under the settlement agreement. Quite simply, the class representative lacked authority to claim, spend, or give away any other class member's settlement check. The Court mistakenly conflates the representative's authority over the class claims with the settlement proceeds it negotiated on behalf of the individual class members. Because the class representative could not assert any missing class member's ownership interest in the fund or cash their individual checks, in my view, it did not exercise ownership over such property. When the property went unclaimed, it was abandoned within the UPA's meaning, notwithstanding the cy pres provision. Remarkably, the Court's explanation is that the “ ‘unclaimed funds' ․ were, in fact, claimed,” ––– S.W.3d at ––––, even though the class representative lacked authority to endorse the checks or otherwise claim the funds belonging to another class member.
Highland Homes Ltd. v. State, 448 S.W.3d 403 (Tex.
The State has standing to, and did in fact, challenge the cy pres distribution to The Nature Conservancy in both the court of appeals and this Court. Class representatives—again, on behalf of settlement class members—acknowledged that Highland Homes denied all liability in the action and agreed to a global release of Highland Homes and its affiliates12 from liability on all claims either brought or that could have been brought. The parties agreed to use their best efforts to obtain judicial approval of their agreement, and that if it was substantively altered, a party adversely affected could terminate the agreement. As the Court acknowledges, the UPA prohibits private limitation and escheat agreements that seek to evade the process for reporting and delivering abandoned property to the State.
We agree with the State, however, that trial courts must be careful in class actions to protect class interests and scrutinize settlements. No one suggests that the trial court in this case failed in that responsibility. Furthermore, the settlement administrator no longer has property belonging to the settlement class members and is not indebted to them because they have agreed, through class representatives, to exercise their right to payment under the settlement agreement within 90 days. With court approval, class representatives were no less authorized to negotiate and agree to the terms of settlement than they were to agree to the amounts paid.
Texas Supreme Court
If they went unclaimed for three years. State by Furman v. Jefferson Lake Sulphur Co. To a civil action” but to facilitate the efficient adjudication of such rights and obligations.
See DaimlerChrysler Corp. v. Inman, 252 S.W.3d 299, 304 (Tex.2008) (“For standing, a plaintiff must be personally aggrieved ․”). The cy pres award was a significant part of the settlement, and we cannot assume that Highland Homes would have reached the same agreement without it. V. Daccach, 217 S.W.3d 430, 450 (Tex.2007) (“Basic principles of res judicata apply to class actions just as they do to any other form of litigation.”) .
Highland Homes Ltd. v. State, 12-0604 (Tex.
The Court ultimately concludes that the unclaimed checks are not abandoned property because the class representative has asserted a claim or exercised a right of ownership over the class members' claims by negotiating the class settlement. See ––– S.W.3d at –––– (noting that “the class representatives asserted claims for refunds in the litigation, controlled the prosecution of those claims as owners, negotiated the terms for settling the claims, asserted claims for payments under the settlement agreement, and then released all claims”). But that all occurred before the three-year period for determining abandonment of the checks even commenced. The assertion of a claim or the exercise of an act of ownership occurring before the three-year period begins is, I submit, meaningless. Under the Texas Unclaimed Property Act (“the Act”),5 as we shall explain more fully, property that goes unclaimed for three years may be presumed abandoned and must then be delivered to the Comptroller to hold for the owner.
The UPA does not permit this exceptional treatment. The plaintiffs did not participate in the proceedings in the court of appeals. The State argues that because Highland Homes has now disclaimed any interest in settlement funds, it lacks standing to complain of the court of appeals' modification of the settlement and the judgment predicated on it. But “ final judgment which is founded upon a settlement agreement reached by the parties must be in strict or literal compliance with that agreement”. Youth Camps, Inc., 532 S.W.2d 292, 292 (Tex.1976) . It should go without saying that when a party agrees to one judgment and a materially different one is rendered, the party is personally aggrieved and has standing to complain.
We host some of the largest open legal databases on the planet, but we need your support to do our work. Please make a charitable donation today. Highland Homes was authorized to deduct from the award any administration expenses that exceeded $30,000. P. 42 , 42 , 42 , 42 (class members' right to object to settlement), 42 .
The Act would not apply in either instance because Benny & Benny and Polendo claimed the property, and thus it could not be presumed abandoned. One class member requested exclusion from the class because it had not been injured and another because it did not want to participate. Under Rule 42, the absent settlement class members participated in the litigation and settlement through their representatives as fully as the representatives did in person.
The Court concludes, however, that Highland is no longer a "holder" of any identified class member's property and that the settlement agreement does not concern abandoned property, and thus, the UPA does not apply. The Court apparently agrees that the UPA would invalidate the settlement agreement's 90-day limitation period and private escheat provision, if it applied to the agreement. Such procedures include court approval of class representatives and class counsel, notice to class members, and court approval of a proposed settlement after an opportunity to be heard.
But in 2006, one subcontractor, Benny & Benny Construction Company, sued, alleging that Highland Homes had represented it would use the paycheck deductions to obtain liability insurance covering the subcontractor. Highland Homes denied Benny & Benny's claim but clarified its policy for the future. Principles of res judicata apply to class actions just as they do to any other form of litigation.”) . The trial court approved the settlement and rendered final judgment accordingly, “binding on all parties to the Settlement Agreement and on all Settlement Class Members ... Who did not timely request exclusion from the Settlement Class”.
Subject to notice to the class and the trial court’s review and approval. And Rule 42 prescribes procedures to ensure that those whose claims are settled or adjudicated in absentia are afforded due process. Affirm the court of appeals’ judgment. Because the Court does not, I respectfully dissent. Accordingly, the judgment of the court of appeals is reversed and the judgment of the trial court is affirmed. "is a procedural device intended to advance judicial economy by trying claims together that lend themselves to collective treatment."
As already discussed, the class representative's authority extends to the settlement of the class claims but not to the disposition or forfeiture of the individual class member's vested property rights. The class action rule may authorize the representative to settle the class member's claim, but it does not authorize the representative to take away the member's share of that settlement once it has vested. The UPA prevents individuals or entities that hold property belonging to others from prospectively contracting for the disposition of such property, if unclaimed by the rightful owner. Thus, for example, landlords, banks, utilities, and insurance companies cannot contract for the future disposition of unclaimed funds owed to their respective tenants, customers, or policyholders in circumvention of the UPA. The Court here, however, imbues the class representative in class-action litigation with special power to make such disposition.
An administrator designated by the parties would then use computer software and other means to update the addresses. If the settlement was finally approved, Highland Homes would issue refunds checks, sending them to existing subcontractors as it would their paychecks or by mailing checks to former subcontractors last known addresses. The following example illustrates the flaw in the State's argument. Suppose Benny & Benny had never asserted class claims, had settled its own claims on the same terms, and then had decided to tear up the $28,000 settlement check in hopes of getting more business from Highland Homes. Surely the State could not insist that Highland Homes was nevertheless obligated to pay the $28,000 to the Comptroller until Benny & Benny broke down and took it. Suppose Benny & Benny made the same decision for Polendo, acting as his attorney-in-fact.
To tear up the $28,000 settlement check in hopes of getting more business from Highland Homes. Objections.” The notice should describe the action and the plaintiffs’ rights in it. From liability on all claims either brought or that could have been brought.
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