Depositions serve two important functions in pre-trial procedure. First, they can be used to discover what a witness or party will say and tie down the witness’s story. Second, they can be used to create testimony which can be used at trial. However, the ability to use a non-party deposition at trial differs between Texas state and federal courts, a distinction which can be important into an attorney’s trial preparation. A recent decision from the Fifth Circuit highlights this distinction. Case No. 20-50604, Spectrum Association Management of Texas, LLC v. Lifetime HOA Management, LLC. (5th Cir. 7/13/21). A copy of the decision can be found here.  Under Texas Rule of Civil Procedure 203.6(b), a deposition taken in a case can be “used for any purpose in the same proceeding in which it was taken.” Federal Rule of Civil Procedure 32(a) allows a deposition to be used in three instances: (a) impeachment of a witness who testifies at trial; (b) if the deposition was of a party opponent or that party’s officer, director, managing agent or designee; or (c) if the witness is unavailable to testify at trial. A witness is unavailable if the witness is (a) dead, (b) is more than 100 miles from the place of hearing or trial or is outside the United States, unless it appears that the witness’s absence was procured by the party offering the deposition, (c) if the witness could not appear due to age, illness, infirmity, or imprisonment, (d) the witness’s attendance could not be compelled by subpoena, or (e) other exceptional circumstances. The federal rule limiting when a deposition can be used at trial seems designed to protect the finder of fact’s ability to determine the credibility of a witness, as well as to allow opposing counsel the ability to cross-examine the witness at the time of trial. These purposes are balanced against the inconvenience to the witness and the prejudice to counsel if a party is truly unavailable. The Spectrum case (which was not a bankruptcy decision) involves the 100-mile rule.  A case was filed in San Antonio but was re-assigned to a judge sitting in Waco. The case remained docketed in San Antonio. Three months before trial, the parties were notified that the trial would take place in Waco rather than San Antonio. One month before trial, Spectrum gave notice that it intended to present the testimony of Spencer Powell, a former Lifetime partner, by deposition.  The Lifetime parties waited until trial to object to use of Powell’s testimony. They argued that the case was pending in San Antonio and that Powell was a resident of San Antonio. Spectrum argued that because the trial was being held in Waco, and Waco is more than 100 miles from San Antonio, that Powell was unavailable for trial and his deposition could be used. The District Court Judge allowed the use of the deposition and the Fifth Circuit affirmed. The Fifth Circuit reasoned that the term “place of hearing or trial” refers to the actual place where the hearing or trial would take place. Although there was not any Fifth Circuit authority on point, it relied on Tatman v. Collins, 938 F.2d 509 (4th Cir. 1991). In that case, a District Judge refused to allow a deposition to be used because the witness resided less than 100 miles from border of the district where the trial was to take place. The Fourth Circuit reasoned that if the rule was interpreted to mean 100 miles from the edge of the district that the burden on the witness would vary depending on the size of the district. Lifetime also argued that it was prejudiced by use of the deposition because it had strategically withheld its cross-examination during the deposition. The Fifth Circuit rejected this argument, finding that Lifetime had three months before trial and one month after the witness was designated to request leave to re-open the deposition and cross-examine the witness. As a result, the Fifth Circuit affirmed the trial judge’s decision to allow the use of the deposition and ultimately affirmed the award of damages against the Lifetime parties. The Spectrum case illustrates why practitioners who are used to practicing under either the state or federal rules can sometimes be surprised when appearing in the less familiar forum. It also illustrates how parties may have to adjust their trial preparation when underlying circumstances change. Lifetime’s decision not to cross-examine Powell during his deposition was a sound one when it thought that the case was going to be tried in San Antonio. However, when the place of trial shifted, Lifetime needed to shift its strategy as well. The trial in the Spectrum case took place in February 2020, just before the Covid-19 pandemic shut down normal court operations. How should the court apply the rule on the “place of hearing or trial” when court is being conducted remotely? Would the place be where the judge was sitting? If the judge was appearing from a remote location, would the “place” be where the court staff was present? Or would the place of trial be construed to be anywhere with internet access? The same issues arise with regard to Fed.R.Civ.P. 45, which requires a person served with a subpoena to appear for a trial or deposition if served within 100 miles of “where the person resides, is employed or regularly transacts business in person.” Could a person in Austin, Texas be subpoenaed to appear in court in Anchorage, Alaska if the person is able to appear from a computer located in Austin? The two rules could be interpreted together in the instance where the witness had previously been deposed, was subpoenaed to appear remotely, and then was unable to appear due to an electricity or internet failure. What these hypotheticals illustrate is that “place” has a definite meaning for in-person trials and hearings but is less certain when applied to remote proceedings. As the pandemic winds down and courts return to in person sessions, it is less likely that we will need to know the answers to these questions. However, if future circumstances require us to go remote in the future, it will be wise to remember the lessons learned during the time of Covid.  

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BY IGOR ROITBURG, MANAGING DIRECTOR & ED BOLTZ, PARTNER, LAW OFFICES OF JOHN T. ORCUTT Click here for the article: Preparing for the Post-COVID Resurgence of Home Mortgage Modifications