Things a Lawyer Should Know About the Enforcement of Rule 11 Agreements

David Stockel, Kasi Chadwick

October 18, 2012

Read related alert “Is your Rule 11 Agreement Enforceable? Things to know about Rule 11 agreements in Texas.

Attorneys who practice in State Courts in Texas are generally familiar with Rule 11 to the Texas Rule of Civil Procedure, or as it is more commonly referred, a “Rule 11 agreement.” A Rule 11 agreement can apply to anything from extending the deadline for objections and responses to written discovery, to complex settlement terms concerning the expenditure of company funds while an agreed temporary injunction is in place, to extending the deadlines to produce documents in discovery, and almost anything between. On a basic level, Rule 11 provides that no agreement between attorneys or parties touching any suit pending will be enforced unless it is in writing and signed and filed with the papers as part of the record or unless the agreement is made in open court and entered of record. Trial courts have a ministerial duty to enforce valid, undisputed Rule 11 agreements.

Though Rule 11 agreements are prominent in Texas practice, it is less common for practitioners to have a good command of the proper procedures to enforce them after a breach or upon differing interpretations of the agreement. For example, attorneys frequently—and in error—file a “motion to enforce a Rule 11 agreement.” In response to the filing of these “motions,” judges routinely ask:

1. Have you amended your pleadings to bring a cause an action for an alleged violation of the Rule 11 agreement?

2. How do you respond to the case law that holds that amending your pleadings is required prior to filing a motion to enforce the Rule 11 agreement?

Lawyers who file these “motions” are typically without retort.

Rule 11 agreements can be revoked. As ruled in ExxonMobil Corp. v. Valence Operating Co., while a party may revoke their consent to a Rule 11 agreement under certain situations, the revoked Rule 11 may still be enforced under contract law considering “the surrounding facts and circumstances.” (On a similar note, the Fifth Circuit held that e-mail exchanges, though not formally called a “Rule 11 agreement,” can constitute a valid settlement contract.) An action to enforce a Rule 11 agreement to which consent has been withdrawn must be based on proper pleading and proof. Ultimately, for a revoked Rule 11 agreement, the party seeking enforcement must pursue a separate breach of contract claim subject to the normal rules of pleading and proof.

Accordingly, remedying a conflict in interpretations over a Rule 11 agreement should begin with an amendment to the pleadings to assert a breach of contract claim for the alleged violation of the Rule 11 agreement. The movant must then follow the normal rules of pleading and proof (i.e. filing a motion for summary judgment) seeking a judicial determination that the other party breached the Rule 11 agreement. Of course, as with most breach of contract claims in Texas, attorney fees can be recovered for such a claim.

Given the cost and expense involved in litigating conflicting interpretations of Rule 11 agreements, attorneys should be intentional in the language used in Rule 11 agreements to ensure clarity.