PER CURIAM

Sitting: Phil Hardberger, Chief Justice

Alma L. López, Justice

Sandee Bryan Marion, Justice

Delivered and Filed: August 30, 2002

DISMISSED

Pending before the court are the motions for rehearing and motions for en banc reconsideration filed by appellee Telefonos De Mexico, S.A. and appellees SBC International, Inc. and SBC Communications Inc., together with the responses and replies to those motions. On July 9, 2002, the parties requested that this court stay any action on the motions for thirty days pending settlement negotiations.

On August 22, 2002, the parties filed a joint motion stating that the parties have compromised and settled all claims and issues between them. The parties request that we withdraw our prior opinion and dismiss the appeal. The parties recognize that this court has the discretion to determine whether to withdrawn our previously issued opinion. See Tex. R. App. P. 42.1(c).

In Caballero v. Heart of Texas Pizza, L.L.C., 70 S.W.3d 180, 181 (Tex. App.--San Antonio 2001, no pet.), this court adopted "a more liberal interpretation of the power inherent in this court to dismiss [an] appeal in accordance with the parties' intentions." Accordingly, we carved out an exception to our general rule that would require all previous orders and judgments to be set aside when a cause became moot on appeal. See id. This exception applies "when the parties have bargained for and agreed upon a full and final settlement, but wish to leave the trial court's judgment intact as a bar to relitigation or . . . as a means to redress a breach of the settlement agreement." Id. The parties request that we apply this exception and leave the trial court's underlying judgment intact.

Because "[p]ublic policy favors settlement agreements," we grant the joint motion. Id. Our opinion and judgment dated March 13, 2002, are withdrawn, and we dismiss this appeal. In view of the dismissal, the pending motions for rehearing and motions for en banc reconsideration are rendered moot. Costs of the appeal are taxed against the parties who incurred them.

PER CURIAM

DO NOT PUBLISH