Being an appellant is hard when you don’t have a reporter’s record.  In this instance, the defendant filed an interlocutory appeal of a temporary injunction order, claiming that the plaintiff and intervenors had no standing to assert their claims and that the trial court had made a host of other errors.  But the court of appeals could find no request for a reporter’s record.  Only a partial transcript of the temporary injunction was included in the record, and there was no notice of issues relied upon in the clerk’s record.  In the absence of a complete reporter’s record, the court of appeals had to presume that the missing portions of the transcript supported the trial court’s ruling.  Accordingly, the temporary injunction was affirmed.

Dao v. Silva, No. 5-12-00331-CV

Van Peterson entered into a contract with ADT to provide commercial alarm services to his jewelry store. Allegedly, an unidentified man wearing an ADT uniform and driving an ADT van came to the jewelry store and sold Van Peterson a device for its alarm system, but instead of installing the device, the man disabled the alarm. Van Peterson’s store was burgled soon after. Van Peterson brought various tort, fraud and DTPA claims against ADT. ADT filed a traditional motion for summary judgment on the tort claims, arguing that Van Peterson waived liability for these claims in the contract, and a no-evidence motion on the other claims. The trial court eventually denied the motions but permitted an interlocutory appeal under former section 51.014(d) of the Texas Civil Practice and Remedies Code.

On appeal, the court first held that ADT could not raise issues first advanced in its reply in support of its no-evidence motion for summary judgment. The court reversed the trial court’s denial of summary judgment on the tort claims because the parties’ contract included a limitation-of-liability provision as to those claims. Such waivers are not invalidated by the DTPA, which only limits waivers of DTPA claims. Finally, the court held that ADT could not challenge on appeal Van Peterson’s subrogated insurer’s pursuit of a DTPA claim because only Van Peterson was a party to the litigation and any opinion as to the insurer would be advisory.

ADT Security Services, Inc. v. Van Peterson Fine Jewelers, No. 05-11-01468-CV

Attorney Robert Collins was sued by his client, Chris Green, for professional negligence and breach of fiduciary duty.  Green claimed that Collins had failed to serve the defendant in the underlying lawsuit, thereby allowing that case to be dismissed for want of prosecution.  As a result, Green’s claims became time-barred.  Collins filed an answer to Green’s lawsuit, but failed to appear at trial. Green testified in support of his claim, and the trial court granted a default judgment for $31,500.  The trial court subsequently denied Collins’ motion for new trial, and Collins appealed.

On appeal, Collins argued that the judgment had to be reversed because Green had failed to prove that he could have collected on any judgment in the underlying lawsuit.  But while that complaint may have been accurate, the court of appeals saw no need to reach it because Collins had failed to brief anything about Green’s breach of fiduciary duty claim.  That meant that he had failed to attack all independent grounds supporting the judgment, resulting in affirmance of the case.

Collins v. Green, No. 05-11-00893-CV

In this Memorandum Opinion, the appellant, a director of a bankrupt company, was found liable for the amount the bankruptcy court required his company to distribute to a creditor.  Strangely, this personal liability was based on Chapter 171 of the Tax Code, which provides that if a corporation forfeits its “corporate privileges” for failure to pay its franchise taxes, each director or officer of the corporation is liable for any debt of the corporation.  While the appellant argued that this provision only applied to tax liabilities, the Court of Appeals affirmed the trial court’s decision and held that “[n]othing in the wording of this statute suggests that personal liability of officers and directors is limited to the tax liability.”

Yigal Bosch v. Cirro Group, Inc., No. 05-11-01625-CV

The court of appeals has issued an opinion reversing an award of sactions in a case arising out of the purchase of a $1.5 million painting.  According to the plaintiff, the defendant art gallery had sold him an N.C. Wyeth painting titled The Sheriff (you can see it here), based in part on the representation that it had been used on the cover of the Saturday Evening Post in 1908.  The buyer subsequently found out that was not true, and sued the gallery for a number of claims, including violations of the Deceptive Trade Practices Act.  The gallery moved for summary judgment, and the plaintiff nonsuited his case.  That led the gallery to move for sanctions, alleging that the suit had been brought in bad faith.

The trial court held a hearing on the sanctions motion, but the plaintiff’s attorney missed it due to a mix-up by his office. The court went ahead with the hearing anyway and awarded sanctions of approximately $83,000.  When the attorney discovered what had happened, he filed a motion for reconsideration and motion to vacate, which the court granted, reducing the sanctions award to $7,500.  But while the first sanctions order had explained the basis for the award in detail, the second order stated only that it was for “violation of TEX. CIV. PRAC. & REM. CODE § 10.001 (1), (3) relating to the plaintiff’s claims brought against the defendant pursuant to the Deceptive Trade Practices Act.”  The court of appeals held that finding was insufficiently specific to sustain the sanctions, especially in light of the nearly $75,000 difference between the two orders.  The court of appeals therefore reversed the judgment and remanded to the trial court for additional consideration — but with a footnote noting the panel’s “grave reservation to condone an award of sanctions against an attorney for filing a suit with multiple claims and asking for more in damages than the statutory limit of a single claim.”

Although it was not mentioned in the court’s opinion, the plaintiff had actually refiled his case in federal court shortly after he nonsuited it in state court.  You can find some of the background of the dispute, including a statement from the gallery’s attorney, here.  According to PACER, that version of the lawsuit is still being litigated.

Sell v. Peters Fine Art, Ltd., No. 05-11-00469-CV

Green Mountain Oil and Gas Corporation sought to “flip” its oil leases by assigning them to EOG Resources at a higher price than it had paid for them.  After it had signed the assignment, however, EOG discovered that the lease assignments created an additional overriding royalty that reduced the mineral estate amount.  Because the leases included a draft–and because each draft provided that if the draft was not paid within 20 banking days, the bank was to return it to the payee and all further obligations of the parties would terminate–EOG decided to decline payment of each of the drafts and terminate the contract.   Green Mountain sued, seeking enforcement of the assignment.  The Court of Appeals, however, found that, under the terms of the draft, “EOG had an absolute right not to pay the draft.”  Accordingly, it did not breach the contract when it declined the draft regardless of whether EOG’s agent had established good title.

Green Meadow Oil & Gas Corp. v. EOG Resources, Inc., No. 05-11-00291-CV

The court of appeals has issued a lengthy opinion in an employment non-disclosure case, partially affirming a jury verdict in favor of the former employer.  In this instance, both the plaintiff and the corporate defendant were in the business of providing in-home pediatric nursing services.  After the defendant company hired away three of the plaintiff’s employees, eleven of the plaintiff’s most profitable accounts moved over to the new company.  The court of appeals started by noting that the defendants did not challenge the jury’s finding that they had entered into a conspiracy to damage the plaintiff.  That led the court to conclude that each of the defendants was jointly and severally liable for the other defendants’ breaches of their non-disclosure agreements, which were themselves established by sufficient evidence at trial.  The court of appeals upheld the jury’s award of $250,000 in lost profits attributable to the eleven patients lost by the plaintiff, but reversed and rendered amounts that had been awarded for profits that would have been earned after the plaintiff went bankrupt and sold off its business.  According to the court, there was no evidence that he plaintiff would have had the right to continue receiving profits from customers after the business was sold, so there was no evidentiary basis for the recovery of those post-sale profits.  Finally, the court of appeals affirmed the trial court’s grant of JNOV against the plaintiff on its claim for attorney fees, holding that fees were not recoverable because the plaintiff had not offered any proof of presentment to the defendants.

Helping Hands Home Care, Inc. v. Home Health of Tarrant County, Inc., No. 05-08-01657-CV

The court of appeals has issued an opinion that serves as a useful primer on the statute of frauds.  The appellant, Michael Kalmus, sue to recover for unpaid commissions after his employment was terminated.  The appellee, Financial Necessities Network, defended the case with the statute of frauds, claiming that the oral agreement alleged by Kalmyus was essentially an agreement for lifetime employment that could not be enforced in the absence of a signed writing.  The court of appeals reversed and remanded, holding that the evidence showed the agreement was terminable at will, and therefore could have been concluded within a year’s time.  In the course of announcing that decision, the opinion collects and recites much of the black-letter law regarding the statute of frauds, making it a useful source of future citations on the topic.

Kalmus v. Oliver, No. 05-11-00486-CV

The court dismissed an agreed interlocutory appeal from the trial court’s denial of competing motions for summary judgment related to a home foreclosure for want of jurisdiction. The Guzmans obtained a home mortgage on which the Bank eventually foreclosed. The Guzmans sued for wrongful foreclosure and breach of contract and argued that the Bank lacked standing to foreclose on the property or enforce the original note. Both sides moved for summary judgment, and the trial court denied the competing motions on the basis that the parties failed to satisfy their burdens for summary judgment. In agreement on the facts and the relevant legal issues, the parties filed a joint motion to appeal from interlocutory order under section 51.014(d) of the Civil Practice and Remedies Code contending that the “issues raised in [the] dispositive motions involve controlling questions of law as to which there is a substantial ground for difference of opinion, and obtaining a ruling on those issues of law from the appeals court will materially advance the outcome of this case.”

In its jurisdictional analysis, however, the court of appeals emphasized the fact that the trial court did not substantively rule on the controlling legal issues presented in the agreed interlocutory appeal. Instead, it submitted the issues to the appellate court for an advisory opinion – contrary to the purpose of section 51.014(d) – and thus the court had no jurisdiction over the appeal under that section.

Bank of New York Mellon v. Guzman, 05-12-00417-CV

In this Memorandum Opinion, the Court of Appeals addressed who has the authority to determine whether arbitration should be compelled: a court or an arbitrator.  The Court noted that, while, as a general matter, the courts decide whether the parties have agreed to arbitrate an particular issue, “the parties may agree to submit the substantive issue of arbitrability to arbitration.”  In this case, the relevant arbitration provision included the following clause: “Whether such Dispute will be subject to arbitration will likewise be determined in such arbitration as will the determination as to whether all procedural conditions precedent to arbitration have been satisfied.”  According to the Court, this provision presents “clear an unmistakable evidence of the parties’ intent to delegate arbitrability to the arbitrator.”  The Court, however, expressed no opinion on whether the plaintiffs’ claims actually should be submitted to arbitration because that, of course, was an issue for the arbitrator to decide.

Continuum Health Services, LLC v. Sheila Cross, No. 05-11-01520-CV

The court affirmed a summary judgment in favor of the bank in a foreclosure case dealing with the waiver statutory offset rights contained in Chapter 51 of the Texas Property Code. A builder entered construction loan agreement secured by four properties and signed a personal guaranty of the loan, eventually defaulting. The bank foreclosed on and sold the properties and sued the builder for the deficiency. The builder invoked Chapter 51, asking the court to determine the fair market value of the properties for the deficiency calculation rather than the foreclosure sale price. Town North moved for summary judgment arguing that the guaranty included a waiver of his right to claim any deductions or offsets from the amount guaranteed including any right to seek a reduction in the deficiency under section 51.003, which the trial court granted and then entered a judgment on the deficiency.

On appeal, the court cited its opinion in Interstate 35/Chisam Road, L.P. v. Moayedi, No. 05-11-00209-CV, 2012 WL 3125148 (Tex. App.—Dallas Aug. 2, 2012, no pet.) holding that the rights provided by section 51.003 are subject to waiver. It also cited King v. Park Cities Bank, No. 05-11- 00593-CV, 2012 WL 3144881, at *3 (Tex. App.—Dallas Aug. 3, 2012, no pet. h.) to reject the builder’s argument that language in the guaranty waiving “any defenses given to guarantors at law or in equity other than actual payment and performance of the indebtedness” did not encompass a waiver of section 51.003’s right of offset despite the guaranty’s later reference to a “claim of setoff.” Thus, the court held that the builder waived his rights under section 51.003.

Smith v. Town North Bank, 05-11-00520-CV

The court affirmed a judgment in a construction contract dispute between two subcontractors. The general contractor of a shopping center project, Mycon, subcontracted with Bulldog to fabricate the steel and erect the steel-reinforced concrete panels around the center’s trash dumpsters. Bulldog subcontracted Top Flight to erect the panels. Top flight testified that Mycon directed the concrete pouring to take place well outside of the range that Top Flight had instructed. Top Flight then requested a $7,500 change order from Bulldog for the extra erection cost, which Mycon refused. Under pressure from Mycon, Bulldog eventually installed the panels themselves, without notifying Top Flight, and then invoiced and eventually sued Top Flight for the cost of installation. Top Flight counterclaimed for the 10% retainage amount left on the contract. Finding that Bulldog did not notify Top Flight to complete installation of the panels breached the subcontract by preventing Top Flight’s performance, the trial court rendered judgment for Top Flight for its retainage, interest, and attorney’s fees.

On appeal, Bulldog did not challenge the trial court’s finding that Top Flight was never notified to complete the installation of the dumpster panels despite the extra cost, and without allowing Top Flight an opportunity to perform, Bulldog undertook to install the dumpster panels using its own employees. The court held the fact that Bulldog prevented Top Flight from performing under the contract, which supported the conclusion that Top Flight did not breach the contract and that Bulldog did.

Bulldog Ironworks, LLC v. Top Flight Steel, Inc., 05-10-01360-CV

Richardson Hospital Authority (“RHA”) hired Plaintiff, Placidus Duru, as a nursing assistant.  But when Duru was indicted for sexually abusing a patient, the hospital terminated him.  Four years later, when the prosecution dismissed the criminal case against Duru, he turned around and sued RHA for malicious prosecution, business disparagement, breach of contract and unjust enrichment.  RHA moved to dismiss these claims for lack of subject matter jurisdiction, but the trial court denied their motion for all claims except malicious prosecution.  The Court of Appeals reversed the trial court’s decision to dismiss the business disparagement, breach of contract and unjust enrichment claims (the malicious prosecution claim’s dismissal was not appealed), finding that the Texas Tort Claims Act did not waive the sovereign immunity enjoyed by RHA, a public institution, because Duru’s pleadings “affirmatively negate jurisdiction.”

Richardson Hospital Authority v. Placidus Duru, No. 05-12-00165-CV

Maybe things would have gone better for King Lear if the court of appeals had been around to mandamus Goneril and Regan.  In this case, Francis Hutchins’ will divided the estate among her three daughters and appointed one of them, Susan Jones, as the executrix of the estate.  But before the will was filed with the probate court, another one of the daughters, Karen Coyle, took possession of some of the property, including a Chrysler 300 and some jewelry.  Susan filed a “Motion for Turnover Order,” citing both section 37 of the Probate Code and section 31.002 of the Civil Practice & Remedies Code, seeking to force Karen to return the property to the estate.  The trial court denied the motion, leaving Susan to seek mandamus relief from the Dallas Court of Appeals.

Karen argued that section 31.002 was inapplicable because it only governs post-judgment turnover orders, and there was no judgment resolving the disputed issue of who should get to keep the property.  But while the parties’ arguments below had focused on that question, the court of appeals relied on the Probate Code to determine that the property should be returned pending administration of the estate, and that the trial court had abused  its discretion by denying the turnover motion solely on the basis of section 31.002.  The court further held that Susan had no adequate remedy at law because she was entitled to possession of the property even in the absence of an appealable judgment.  Accordingly, the court of appeals conditionally granted Susan’s petition for writ of mandamus.

In re Estate of Francis J. Hutchins, No. 05-12-01098-CV; see also In re Estate of Francis J. Hutchins, No. 05-12-01163 (dismissing concurrent appeal for lack of jurisdiction because there was no appealable judgment).

Carment Llerena, a former bookkeeper and secretary for Defendant North Texas Trucking, sued her former employer for negligence and fraud related to her termination.  The jury found North Texas liable and rendered judgment in Llerena’s favor, and the trial court overruled North Texas’s motion for judgment notwithstanding the verdict.  On appeal, however, the Court of Appeals reversed the trial court’s decision and found that Llerena should instead take nothing from North Texas on both claims.

The Court’s opinion turned on two issues.  First, the Court rejected Llerena’s fraud claim. While Llerena argued that she was fraudulently induced to accept a job with defendant based on North Texas’ representation that it had workers’ compensation insurance, the Court found that she had presented no evidence of “what she would have received had North Texas provided workers’ compensation insurance.”  Second, the Court rejected Llerena’s contention that her former employer caused her to work in unsafe conditions that led to her carpal tunnel syndrome, finding instead that she presented “no evidence that any modification of her work environment or work requirements would have prevented or lessened her injury.”

North Texas Trucking v. Carmen Llerna, NO. 05-10-01061-CV

In an opinion affirming a breach-of-contract case between two subcontractors, the court of appeals reiterated an important appellate principle: unchallenged findings of fact is binding against the appellant.  In this case, Bulldog Ironworks failed to challenge the trial court’s finding that the prevailing party, Top Flight, was never notified by Bulldog or the general contractor that it needed to complete its portion of the project before Bulldog completed the task with its own employees.  Without such notice, the court of appeals concluded that Bulldog had prevented Top Flight from performing, thereby breaching Bulldog’s own contractual obligations.

Bulldog Ironworks, LLC v. Top Flight Steel, Inc., No. 05-10-01360-CV

The court issued a memorandum opinion clarifying the appellate timetable after the filing of a foreign judgment in a Texas court. Appellee received a judgment in a New York court and filed it in the Texas trial court on September 29, 2011. Appellant filed a notice of appeal on June 20, 2012. The court questioned whether the notice of appeal was untimely. In her jurisdictional brief, appellant argued that the deadlines for post-judgment motions set forth in Tex. R. Civ. P. 329b run from the date the judgment was signed in the New York court, and thus contended that she never had an opportunity to contest the foreign judgment because the deadlines to do so had expired before appellee filed the foreign judgment in the Texas court.

The court held that Rule 329b applies only to Texas judgments. Under Tex. R. App. P. 26.1(a)(1), the ninety day deadline for the appellant to filed her notice of appeal ran from the date that the appellee filed the foreign judgment in the Texas court. Thus, she had filed her notice of appeal more than five months past the deadline, and the court dismissed the appeal for want of jurisdiction.

Watel v. Dunmann Realty, LLC, No. 05-12-00938-CV

The court affirmed a judgment in favor of a hauling company on its breach of contract claim against subcontractors on a city construction project. The parties disputed whether a contract was formed to haul dirt and concrete debris from the project for $40 an hour or for $40 a load, and both presented competing evidence and witnesses that testified to their contended contractual rate. After a bench trial, the trial court found that Mejia offered to use his trucks and drivers to haul dirt and concrete debris from the project on behalf of appellants for $40 an hour, that Mejia communicated that offer to De Los Santos, and that De Los Santos accepted the offer. It then rendered judgment in favor of Mejia for $11,794 plus attorney’s fees.

On appeal, Appellants challenged the legal sufficiency of the evidence supporting the trial court’s judgment, and the central challenge was to the evidence supporting the finding that the parties formed a contract at the hourly rate. Appellants also argued that the conflict in the evidence about whether they would pay $40 a load or $40 an hour made the contract ambiguous. The court held that the dispute did not present an issue of contract ambiguity but instead an issue of fact about the actual terms of the contract. Because the evidence was sufficient to support both $40 a load and $40 an hour, the resolution of the conflict turned on the credibility and demeanor of the witnesses – a finding that an appellate court will not disturb.

De Los Santos v. Mejia, No. 05-10-01662-CV

As AutoGas Systems saw that its future prospects looked bleak, one of its executives, John Cullen (its president and COO), circulated to certain employees a severance plan, which included incentives for employees to remain with the company as it wound up its affairs.  Dana Kelman was one of the employees who received the severance plan.  When his time with AutoGas ended, he sued to obtain the funds he was due under the agreement.  The only problem was that AutoGas’s CEO and Chairman, G. Randolph Nicholson, denied that Cullen ever had authority to enter into those severance agreements on behalf of the company.  Kelman moved for summary judgement, insisting that he conclusively established that Cullen’s authority to enter into the severance plan stemmed from his position as president and member of the board.  The trial court agreed and awarded Kelman $93,000 in damages.

The Court of Appeals reversed and remanded.  It found that, although a senior executive like Cullen had authority to bind the company on routine matters arising in the ordinary course of business, the parties advanced conflicting evidence on whether the purported severance agreement qualified as a “routine matter.”   The Court went further, however, and rejected as a matter of law that “a severance agreement developed in anticipation of the winding up of the corporation’s business and resulting in payments substantially higher than the employee’s annual salary of $70,000 is a routine matter.”  The Court also rejected Kelman’s claim that Cullen had apparent authority to bind the company to the severance plan because the parties has presented conflicting evidence of that authority.

AutoGas Acquisitions Corp. v. Kelman, No. 05-11-00692-CV

There will be two new justices taking the bench at the Dallas Court of Appeals starting in January, and last night’s election determined who they will be.  In Place 2, David Evans — former judge of Dallas County’s 193rd District Court — won his election to replace the retiring Justice Joe Morris.  In Place 9, former prosecutor David Lewis will replace Justice Martin Richter, whom he defeated in the May primary election.  Congratulations to both of the incoming justices, as well as to Justices Jim Moseley, Douglas Lang, and Bob Fillmore for being re-elected to their own seats.

A developer in Wylie purchased two adjoining tracts of land.  In 2004, he decided to sell  one of the properties to Capital One.  However, the city decided that both properties would have to be developed as one site, with a single access site on the Capitol One property.  The parties therefore entered into a cross-easement agreement, requiring Capital One to pave the internal drives that would link the access site to both of the properties.  However, Capital One finished its construction and obtained a certificate of occupancy without ever constructing the new approach.  The developer ended up building the driveway himself, and sued Capital One to pay for its cost.  After a bench trial, the trial court awarded the developer awarding approximately $22,000 in damages and another $100,000 for attorney fees.

The court of appeals reversed.   According to the appellate court, the cross-easement agreement required the parties to “keep and maintain” the driveway, but not to actually construct it.  The court also rejected the developer’s argument that Capital One had breached the agreement by failing to comply with a government regulation by not constructing the driveway, because there was no evidence the city had ever ordered Capital One to construct it.  The court also rejected the developer’s quantum meruit argument for failing to attack all grounds asserted in the bank’s summary judgment motion, and remanded to the district court for a determination of the bank’s attorney fees as the prevailing party under their contract.

Capital One, N.A. v. Haddock, No. 05-10-01028-CV

Fannie Mae might sound like somebody’s sweet old grandma, but this grandma knows how to get defaulting borrowers out of the property.  In this instance, the borrower’s mortgage provided that if the house went into foreclosure, he would have to either surrender possession immediately or he would become a tenant at sufferance.  The borrower defaulted, the property was sold at foreclosure, and the buyer sold the property to the Federal National Mortgage Association.  Fannie Mae sent notices to vacate by certified and first class mail, then filed a forcible detainer proceeding.  Both the justice court and the county court at law (in a de novo appeal) ruled in favor of Fannie Mae, and the court of appeals affirmed.  The court held that the tenant at sufferance provision in the mortgage was legally sufficient to establish a landlord-tenant relationship between Fannie Mae and the borrower.  The court of appeals also rejected the borrower’s claim that Fannie Mae had failed to prove it had given him notice of the eviction, holding that delivery of the notice was adequately established by testimony that the copy sent by first class mail had not been returned by the postal service.  Finally, the court of appeals rejected the borrower’s claim that the forcible detainer proceeding should have been abated in favor of a separate lawsuit he had filed in district court to contest title to the property.  Because forcible detainer only determines immediate possession of the property, a separate title contest does not deprive the court of jurisdiction to decide who gets possession of the property in the meantime.

Farkas v. Federal National Mortgage Ass’n a/k/a Fannie Mae, No. 05-11-01416-CV

The court reversed a judgment awarding an law firm lost profits in an action against a litigation services company. Elrod, a litigation law firm, hired A-Legal to perform support services related to E-Discovery. Two days later, Elrod pulled the job when A-Legal doubled the price it previously quoted. Both parties sued each other for breach of contract. Elrod claimed damages from lost revenue and lost business opportunities due to the time its attorney’s and staff lost dealing with A-Legal’s breach. Elrod presented evidence of lost revenue, which it valued at $20,000, but the only specific evidence relating to a worker’s time lost dealing with the breach came from one attorney, Nassar. Nassar testified that her hourly rate is $325 and that she spent about eighty hours in total “dealing with the situation.” Elrod made no attempt to establish what expenses would have been attributable to Nassar’s billable hours or whether the firm lost any specific business or billing during that time. The trial court entered a judgment awarding $20,000 lost profits plus attorney’s fees.

On appeal, the court noted that the only calculation that can be made from Elrod’s evidence is potential gross revenue brought in by Nassar, not net profits, because Elrod presented no evidence to show any expenses related to that revenue or that she actually billed less time because of the breach than she would have otherwise. Thus, the evidence was legally insufficient to show lost profits, the only measure of damages presented, and the court reversed and rendered a take nothing judgment.

A-Delta Overnight Legal Reproduction Services Corp. v. David W. Elrod, PLLC, No. 05-11-00708-CV