IN THE SUPREME = COURT OF TEXAS

IN THE SUPREME COURT OF TEXAS

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No. 04-0931

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Saleh W. Igal, Petitioner

Brightstar Information = Technology=20 Group, Inc. and BRBA, Inc., Respondents

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On Petition for Review from = the

Court of Appeals for the Eleventh = District of=20 Texas

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Argued January 25,=20 2006

Justice Brister filed a dissenting opinion, = in which=20 Chief Justice Jefferson, = Justice=20 O=92Neill, and Justice=20 Medina = joined.

=20 The Texas Legislature passed the Payday Law to give unpaid = workers a=20 quick alternative to lengthy civil litigation. But today the Court holds = they=20 lose everything if they pursue that alternative a little too late, even = though=20 years remain to file suit in court. This is not about biting apples = twice; this=20 is about a man=92s wages, a claim that like many others can be filed a = second time=20 if the first disposition was not on the merits. By holding Payday claims = dismissed for tardiness cannot be refiled in = court,=20 the Court converts a law giving extra options to workers into a trap = where they=20 may forfeit all their rights. Because I agree with the state agency = entrusted=20 with these claims that this could not possibly be what the Legislature = intended,=20 I respectfully dissent.

=20 I agree the Payday Law=92s 180-day filing requirement is = mandatory but not=20 jurisdictional. But I disagree that an order dismissing a Payday claim = as=20 untimely precludes a subsequent suit. Res = judicata attaches only to a judgment on the = merits.[1] There are at least five reasons = why the=20 Texas Workforce Commission=92s order here is not one.

=20 First, the Commission itself says so. In its amicus brief = supporting=20 Igal=92s right to file suit in court, the = Commission=20 says =93res judicata does not=20 apply . . . because TWC=92s order was not a = judgment on=20 the merits but a procedural dismissal for untimeliness.=94 How can the Court hold the = Commission=20 intended a merits dismissal when the Commission itself stipulates that = it did=20 not? There is no reason to doubt the Commission=92s word; the Commission = =93dismissed=94 Igal=92s claim, using a term = employed=20 throughout the Texas Rules of Civil Procedure,[2] and American law generally,[3] for dispositions without = a hearing=20 on the merits. The Commission may have only two options for = preliminary=20 determinations (to dismiss or to order payment),[4] but after a hearing it = can issue=20 any written order it likes.[5]

=20 Second, the order itself shows that Igal=92s=20 contract rights were considered only for the purpose of deciding whether = his=20 claim was untimely. Igal=92s contract = apparently=20 guaranteed him extended payments if terminated without cause, but = nothing if=20 terminated by notice of nonrenewal. Because = the=20 extended payments would have been due within 180 days of Igal=92s Payday filing, the Commission had to = decide whether=20 he was terminated for cause or nonrenewal = =97 not as a=20 finding on the merits but simply to decide whether his claim was timely=20 filed.

=20 Third, to presume the Commission made a ruling on the merits, we = must=20 presume it made a clear error. While an untimely claim did not deprive = the=20 Commission of jurisdiction, it did prevent the Commission from reaching = the=20 merits if anyone complained (which Brightstar did).=20 There is no good reason to encourage administrative agencies to address = the=20 merits of barred claims, especially when those claims are not yet barred = in=20 court. We should not presume the Commission committed an error by = reaching the=20 merits when it could not.

=20 Fourth, Brightstar insisted = throughout the=20 Commission proceedings that Igal=92s claim = was untimely.=20 Brightstar could have waived this complaint = (as it was=20 not jurisdictional), and agreed to have the Commission decide the case = on the=20 merits. But it did not =97 it insisted Igal=92s claim=20 should be dismissed because he filed late. Having obtained success on = that=20 ground, Brightstar should not be allowed to = change its=20 position when the claim was refiled in = court.

=20 Fifth, judgments based on limitations are usually considered = rulings on=20 the merits because a late claim can never be refiled=20 any earlier (barring time travel [6]). But an important exception = applies here=20 because there are two different limitations periods. As the First = Restatement of=20 Judgments stated in a comment:

Thus, if=20 the plaintiff brings an action to enforce a claim in one State and the = defendant=20 sets up the defense that the action is barred by the Statute of = Limitations in=20 that State, the plaintiff is precluded from thereafter maintaining an = action to=20 enforce the claim in that State. He is not, however, precluded = from=20 maintaining an action to enforce the claim in another State if it is not = barred=20 by the Statute of Limitations in that State.[7]

The Second=20 Restatement of Conflict of Laws now makes the same point:

Thus, the=20 plaintiff=92s suit may be dismissed in state X on the ground that it is = barred by=20 the X statute of limitations. This judgment will preclude the plaintiff = from=20 thereafter maintaining an action to enforce the claim in state X. This = judgment,=20 however, binds the parties only with respect to the issue that was = decided. It=20 will preclude the plaintiff from maintaining an action to enforce the = claim in=20 another state only if the courts of the other state would apply the X = statute of=20 limitations . . . .[8]

=20 The First, Second, Fifth, Seventh, and Tenth federal circuit = courts all=20 agree that while dismissals based on limitations are usually preclusive, = they=20 are not preclusive when a case is filed in two different systems that = apply two=20 different limitations periods.[9] In such cases, as Wright and = Miller=20 state: =93[i]f the second forum would decide = independently to apply a longer period of limitations . . . the = traditional rule=20 has been that it is free to proceed with the second action.=94[10] While dismissal of an untimely = claim may=20 be preclusive if based on the substantive law governing the claim (Texas = contract law=92s four years), it is not preclusive if based on a shorter = period=20 designed as a procedural protection for the first forum (the = Commission=92s 180=20 days):

Dismissal=20 based on the limitations period established by the law that governs the = claim is=20 a judgment on the merits that precludes application of a different = limitations=20 period by another court. Dismissal based on application of the forum=92s = own=20 shorter period for purposes of protecting the forum is not a judgment = on the=20 merits and does not preclude an action on the same claim in a court that = would=20 apply a longer limitations period.[11]

=20 This Court has never adopted these well-settled and long-standing = principles, but we certainly have not rejected them either. In the past, = Texas law has=20 not provided two limitations periods for a single claim; now that it = sometimes=20 does when there is an administrative alternative to the courts, we = should=20 explain why we reject the traditional rules followed by everyone = else.

=20 Igal can hardly be faulted for not = appealing=20 the Commission=92s decision. As his claim was untimely, an appeal would = have been=20 futile. Even if he could have convinced an appellate court to reverse = the part=20 of the Commission=92s decision discussing the merits (which I doubt = since it was=20 necessary to decide timeliness), he would still have lost due to the = late=20 filing. The Payday process is supposed to be quick and cheap; requiring = an=20 appeal for this late claim would have simply made it longer and more=20 expensive.

=20 I would not hold that every unsuccessful Payday claimant can = start over=20 with the same claim in court. Claimants should not be permitted to = litigate the=20 same issue twice.[12] But the only issue Igal has litigated so far is whether he filed his = Payday=20 claim within 180 days; he does not need to litigate that issue again = here as it=20 is irrelevant to whether he filed his breach of contract claim within = four=20 years.[13]

=20 The Legislature has chosen to give Texans asserting Payday claims = two=20 different ways to proceed. That being the case, this Court has no = business=20 saying that if they try one too late, then they get none at all. The = Commission=20 properly dismissed Igal=92s Payday claim as = late, but=20 that does not preclude his common law claim which was filed on time. = Because the=20 Court holds otherwise, I respectfully dissent.

=20 ___________________________

=20 Scott Brister

=20 Justice

=20

OPINION=20 DELIVERED: December 7, 2007

^[1]=20 Citizens Ins. Co. of Am. v. Daccach, = 217 S.W.3d=20 430, 449 (Tex. 2007); Amstadt v. U.S. Brass Corp., 919 S.W.2d 644, = 652=20 (Tex.=20 1996).

^[2]=20 See, e.g., Tex. R. Civ. P. 39(b) = (addressing=20 whether suit should be =93dismissed=94 for indispensable party);=20 id. 42(e) (requiring court approval = for=20 =93settlement, dismissal, or compromise=94 of class action); id. = 89 (allowing=20 court to which venue is transferred to =93dismiss=94 case if filing fee = not paid);=20 id. 143 (allowing claim to be =93dismissed=94 = if security=20 for costs not paid); id. 151 = (allowing=20 suit to be =93dismissed=94 if deceased plaintiff=92s representatives do = not appear);=20 id. 161 (allowing = =93dismissal=94 of unserved defendants); id. = 162, 163 (allowing plaintiff to =93dismiss=94 suit before = close of=20 evidence); id. 165a (allowing cases to be = =93dismissed=94 for=20 want of prosecution); id. 215.2(b)(5) = (allowing=20 order =93dismissing=94 suit as discovery sanction); id. 330(d) (allowing court to =93dismiss=94 case if called for = trial twice=20 but not tried); id. 736(10) (requiring home-loan=20 foreclosure action to be =93dismissed=94 if owner files action = contesting=20 foreclosure).

^[3]=20 See Black=92s Law = Dictionary=20 502 (8th ed. 2004) (defining =93dismissal=94 as =93Termination of an = action or claim=20 without further hearing, esp. before the trial of the issues=20 involved=94).

^[4]=20 See Act of May 12, 1993, 73d Leg., R.S., ch.=20 269, =A7 1, 1993 Tex. Gen. Laws 1014 (amended 2005) (current version at = Tex. Lab. = Code =A7=20 61.052).

^[5]=20 See Act of May 12, 1993, 73d Leg., R.S., ch.=20 269, =A7 1, 1993 Tex. Gen. Laws 1015 (amended 2005) (=93After a hearing, = the=20 commission shall enter a written order for the payment of wages that the = commission determines to be due or for the payment of any penalty the = commission=20 assesses.=94).

^[6]=20 Stephen W. Hawking, Chronology = Protection=20 Conjecture, 46 Physical = Rev.=20 D. 603 (1992) (arguing in his =93chronology protection = conjecture=94 that the=20 laws of physics are such as to prevent time travel on all but = sub-microscopic=20 scales).

^[7]=20 Restatement (First) of = Judgments=20 =A7 49 cmt. a = (emphasis=20 added)).

^[8]=20 Restatement (Second) of = Conflict of=20 Laws =A7 110 cmt. b=20 (1988).

^[9]=20 Reinke v. Boden, 45 F.3d 166, 173 (7th Cir. 1995); = Henson v.=20 Columbus Bank, 651 F.2d 320, 325 (5th Cir. 1981); Jimenez v. = Toledo,=20 576 F.2d 402, 404 (1st Cir. 1978); Sack v. Low, 478 F.2d 360, 363 = (2d=20 Cir. 1973); Titus v. Wells Fargo Bank & Union Trust, 134 F.2d = 223,=20 224 (5th Cir. 1943); Stokke v. S. = Pac.=20 Co., 169 F.2d 42, 43 (10th Cir. 1948); United States v. = Lyman, 125=20 F.2d 67, 70 (1st Cir. 1942); Warner v. Buffalo Drydock Co., 67 F.2d 540, 541 (2d Cir. = 1933).

^[10] 18A Charles Alan Wright, Arthur R. = Miller &=20 Edward H. Cooper, Federal Practice and Procedure =A7 4441 (2d ed. = 2002).

^[11] Id. (emphasis = added).

^[12] Cf. Harris County=20 v. Sykes, 136 S.W.3d 635, 639 (Tex. 2004) (holding sovereign = immunity=20 dismissal should be with prejudice =93because a plaintiff should not be = permitted=20 to relitigate jurisdiction once that issue = has been=20 finally determined=94).

^[13] Tex. Civ. Prac. & Rem. Code = =A7=20 16.004(a)(3); Via Net v. TIG Ins. Co., = 211=20 S.W.3d 310, 312 (Tex. 2006) (per curiam).