Dallas Palms LLC v. Jones involved claims that were dismissed because of a failure to provide a certificate of merit, when the movant did not establish that he was, in fact, a licensed architect. The statement of facts describes the various proof deficiencies, which could likely have been avoided with a straightfoward affidavit on the subject. No. 05-23-00156-CV (Nov. 8, 2024) (mem .op.).

The Fifth Court continued to cast a skeptical eye at spoliation instructions in Copper Creek Distributors, Inc. v. Valk. The Court found an abuse of discretion in two regards; first, as to the trial court’s assessment of the evidence about certain QuickBook records:

However, there is no evidence CCDI intentionally or negligently failed to preserve the QuickBooks data. In his deposition, Escoffie testified he had not attempted to log into QuickBooks and he had not called QuickBooks to attempt to access his books ks and records. He stated he would work with his attorney to determine whether he had access to QuickBooks — the record does not show whether this happened and, if it did, whether any documents or data were recovered. Considering the failure to provide any evidence about when CCDI “closed out” its online QuickBooks account and when CCDI migrated from the online platform to the desktop platform along with the lack of evidence about whether Escoffie searched for QuickBooks records and recovered any, the trial court abused its discretion by concluding Platinum met its burden to show CCDI intentionally or negligently breached its duty to preserve accounting books and records, including QuickBooks files. Accordingly, we conclude the trial court erred by instructing the jury that CCDI destroyed or failed to preserve accounting books and records, and the jury could consider that evidence would have been unfavorable to CCDI.

and second, by not considering whether lesser sanctions would be effective. The Court then found harm, and as a result, reversed and remanded. No. 05-23-00123-CV (May 24, 2024) (mem .op.).

My grandfather was the postmaster of Orange, Texas in the 1930s and 1940s, so I have a family interest in cases involving mail. Long v. Paratheke Enterprises, LLC provides an instructive example about whether a key notice, sent by a landlord using certified and first-class mail, was received by the tenant:

• The certified mailing was not delivered successfully. “The evidence showed the U.S. Postal Service attempted to deliver the certified mail letter on September 29, October 4, and October 14 and returned the letter to Landlord’s counsel as “UNCLAIMED” and with a stock printed sticker stating “RETURN TO SENDER INSUFFICIENT ADDRESS UNABLE TO FORWARD.”
• As for the first-class mailing: “Landlord presented evidence that its counsel addressed the notice to vacate to Tenant and sent the notice to the Premises’ address, postage prepaid, by regular first-class mail. Thus, a presumption exists that the mailing was duly received by Tenant.”
• Tenant sought to overcome that presumption with her testimony about difficulty using that mailbox (it was shared by the tenants and open to the street), and by noting the problem with the certified mailing. The Fifth Court held that the trial court was justified in not crediting that testimony: “As factfinder, the trial court is given great latitude to believe or disbelieve a witness’s testimony, particularly if the witness is interested in the outcome.”

No. 05- 22-00685-CV (Aug. 15, 2023) (mem. op.).

The affidavit-counteraffidavit procedure in Tex. Civ. Prac. & Rem. Code § 18.001 streamlines the handling of evidence about whether services are reasonable and necessary. That said, the process can generate controversy, as it did in Ortiz v. Nelaplatla, where the defendant’s counteraffidavits in a personal-injury case only addressed some of the matters in the plaintiff’s affidavits.

The panel majority summarized: “Nelapatla filed counteraffidavits that satisfied the requirements of section 18.001 for the purpose of providing notice to Ortiz of the nature and basic issues in controversy so that Ortiz would have ‘sufficient information to enable [her] to prepare a defense or a response.’ Ortiz did not challenge the counteraffidavits. Under the circumstances presented, we conclude the trial court did not abuse its discretion in sustaining Nelapatla’s objections to admission of Ortiz’s section 18.001 affidavits and Nelapatla’s counteraffidavits as proof of the reasonableness and necessity of Ortiz’s medical services and charges.” (citation omitted).

A dissent expressed concern about the majority’s fidelity to the statutory text and the practical consequences of its opinion. No. 05-22-00531-CV (July 18, 2023) (mem. op.).

In the 2021 case of Aerotek v. Boyd, the Texas Supreme Court differed with the Fifth Court about the interplay of evidence rules and the Federal Arbitration Act. That case involved electronic signatures. he Fifth Court returned to this general subject, but on a different issue, in Fox v. Rehab. & Wellness Centre of Dallas, LLC, a wrongful death action against a nursing home.

The supreme court has observed that the statute requires consideration of submitted “affidavits, pleadings, discovery, or stipulations.” Here, “[r]ather than submitting with their motion [to compel arbitration] any ‘affidavits, pleadings, discovery, or stipulations’ to support their motion, appellees attached to their motion only the two-page unauthenticated Agreement, and they submitted no evidence at the later non-evidentiary hearing.” (citation omitted).

The Fifth Court noted its precedent that would allow rejection of the motion on that record, but did not decide on that basis. It instead holding that the record had no evidence establishing the authority of a husband (the plaintiff) to sign the agreement on behalf of his wife (the decedent) – despite a “certification” to that effect in the agreement.

The case presents an interesting return to a potentially fruitful topic for opponents of arbitration–reminding that arbitration rights are favored if proven, but still must be proven. The case also suggests that nursing homes should be careful about documentation, as the requisite power and authority will not always be presumed. No. 05-21-000904-CV (June 5, 2023) (mem. op.).

Lisle v. Do-Mo Joint Venture arose from a dispute among neighbors about the care of the land between and around their respective properties. The case went to trial. The key damages question began:

and after some instructions, concluded:

Despite the benefit of the property-owner rule, an owner’s testimony was insufficient to support those figures when, inter alia, “the jury was asked to make separate awards for the damage caused by flooding and by trespassing trucks. However, Crandall made no effort to provide damages calculations resulting from these two categories; instead, Crandall provided a blanket, unsupported figure of $200,000 to fix the parking lot.” No. 05-22-00236-CV (May 10, 2023) (mem. op.).

A recent Fifth Court opinion reminded of the importance of an offer of proof, in addition to arguing the related objection, to appropriately preserve error. In the same vein, Phoenix Thera-Lase Systems, LLC v. Curewave Lasers, LLC reminded of an additional step needed to preserve error as to a claimed violation of a motion in limine:

Here, Phoenix’ counsel objected immediately to Herbert’s reference to “two felonies.” However, counsel did not request an instruction to disregard; instead, following an off-the-record discussion at the bench, counsel withdrew the question that elicited the complained-of response. To the extent counsel did not request an instruction to disregard, any error is waived.

No. 05-20-00665-CV (Aug. 4, 2022) (mem. op.).

In a (literal) footnote to Collins Asset Group v. Ayers, the Fifth Court noted a technical point about a line of attack on the relevant instrument: “Ayres also objected to the Note based on the absence of assignments, and on cross-examination, appeared to challenge the signatures on the Note. Ayres did not contest the authenticity of signatures in his verified denial, so the Note was admissible in that regard as fully proved. See Tex. R. Civ. P. 93(7); Boyd v. Diversified Fin. Sys., 1 S.W.3d 888, 891 (Tex. App.—Dallas 1991, no pet.).” No. 05-21-00295-CV (March 30, 2022) (mem. op.).

The panel majority in Texas Champps Americana v. Comerica Bank concluded that after a merger, Comerica owned the note sued upon, noting evidence about the handling of the note and its accounting, in the context of Tex. Bus. Orgs. Code § 10.008(a)(2) which provides: “[A]ll rights, title, and interests to all real estate and other property owned by each organization that is a party to the merger is allocated to and vested … in one or more of the surviving or new organization as provided in the plan of merger without … any transfer or assignment having occurred[.]” A dissent found inadequate proof without evidence tied to the actual plan of merger. No. 05-20-00461-CV (March 29, 2022).

This testimony (in addition to, but also independently of, a business-records affidavit) was sufficient to prove up a note, and the Fifth Court found error in concluding otherwise, in Collins Asset Group v. Ayers:

Dan Laux, CAG’s Legal Outsourcing Manager, testified that he is familiar with CAG’s records and the method by which CAG acquires, stores, and takes possession of notes. He further described how this Note was received, scanned, and stored with CAG’s business records.

 

Laux testified that he received the original Note within thirty days of CAG’s purchase of the Note, and that he had tendered the original to counsel. He identified the Note attached to the business records affidavit as a true and correct copy of the original.

 

Laux also offered testimony about how CAG relied upon and used the Note to calculate the amount due and sent letters based on that calculation. Laux testified that CAG is the owner of the Note.

No. 05-21-00295-CV (March 30, 2022) (mem. op.).

Legally insufficient evidence was offered (under a clear-and-convincing proof standard, with case law that specifically addresses this evidentiary point) of an asset’s separate-property status when:

“The trial court .. questioned Moon concerning what evidence was presented at trial to show ‘that she had separate property before that got converted into the 51 percent community of Lakeside Vision.’ Moon did not cite any evidence but reiterated her contention that she would not have entered into the purchase if she had known it would be community property. The trial court noted the only evidence of tracing was Moon’s testimony regarding funds used for the purchase, but Moon and Scheef offered conflicting testimony as to the source of those funds, and Moon offered no evidence showing inception of title to the funds.”

Moon v. Scheef, No. 05-20-00105-CV (March 23, 2022) (mem. op.).

• “Payment is an affirmative defense which the defendant has the burden to plead and prove. Payments pled by the defendant which are not admitted in the plaintiff’s petition must be specifically alleged.”
• What about trial by consent? “‘The doctrine of trial by consent does not apply when the evidence of an unpleaded matter is relevant to the pleaded issues because it would not be calculated to elicit an objection.’ Milbourn’s testimony was relevant to the Kidwell’s claim for breach of fiduciary duty … that Bresnahan breached his fiduciary duty by failing to disclose his conflicts of interest and by unilaterally increasing his own wages. … Because the Kidwells’ evidence of payment [a spreadsheet] was also relevant to their pleaded claim for breach of fiduciary duty, we conclude payment was not tried by consent.”

Haddington Fund, LP v. Kidwell, No. 05-19-01202 (Jan. 11, 2022) (mem. op.) (citations omitted).

The Fifth Court found that a set of overly-redacted fee statements was legally insufficient evidence to support an award of fees in THB Construction v. Holt Texas, Ltd., observing:

“[T]he evidence here is like that presented in [Long v. Griffin, 442 S.W.3d 253 (Tex. 2014)]. In both cases, counsel testified only to general tasks performed during the representation.  Although Holt’s counsel produced invoices, they effectively provide no additional evidence beyond counsel’s testimony due to the heavy redactions. Indeed, counsel admitted as much. In that regard, the evidence presented here is just as insufficient as that presented in Long.”

The Court further reviewed its own relevant precedent in this area. No. 05-20-00020-CV (Jan. 13, 2022) (mem. op.) (citation omitted).

The question whether testimony is “conclusory” arises frequently in commercial litigation, particularly when the testimony is presented by affidavit. While the boundary lines are not always clear, one definite data point for practitioners was provided by Chloe’s Concepts, LLC v. Clear Rainbow, Inc., which held in a default-judgment case: “Appellants complain that the affidavit of Clear Rainbow’s president does not state when default occurred but merely concludes the past due amount was $128,259.86 and that prejudgment interest was $11,069.00. However, ‘[t]estimony of the total amount due under a written instrument is legally sufficient to support an award of that amount in a default judgment proceeding.'” No. 05-20-00484-CV (Dec. 20, 2021) (mem. op.) (citation omitted).

In an echo of Toyota Motor Sales v. Reavis, 627 S.W.3d 713 (Tex. App.–Dallas 2021, pet. filed), the Fifth Court found that the plaintiff’s expert testimony in a significant car-accident case was sufficient to create legitimate jury issues on the topics of (1) “human factors” testimony about design defect, (2) a mechanical engineer’s testimony about a safer alternative design, and (3) proximate cause. American Honda Motor Co. v. Milburn, No. 05-19-00850-CV (Nov. 24, 2021) (mem. op.).

In a temporary-injunction appeal, the Fifth Court reasoned: “During the time of COVID, remote proceedings and electronic submissions are the rule rather than the exception. Sohail’s submission of his affidavit and other evidence electronically prior to the Zoom videoconference was in compliance with the trial court’s standing order. Sohail’s evidence was put into the record, referenced and discussed without objection from appellants. Although the trial court did not use ‘magic words’ admitting into evidence Sohail’s affidavit and electronic submissions, the trial court’s order granting a temporary injunction repeatedly states that it was based on Sohail’s evidence.” Kazi v. Sohail, No. 05-20-00789-CV (Oct. 28, 2021) (mem. op.).

The appellant in Square 9 Softworks v. SIPS Consults Corp. appealed the denial of its special appearance, arguing that because it proved itself to be a nonresident, that showing sufficed in the absence of adequate jurisdictional allegations. Unfortunately, it did not appeal the striking of the declaration that would have established that matter:

“In this case, however, even if we assume SIPS failed to plead sufficient jurisdictional facts, the only evidence submitted by Square 9 to prove it was not a Texas resident, and the only evidence it points to on appeal, is the sworn declaration signed by Frattini that was struck in its entirety from the record by the trial court. Square 9 does not challenge the trial court’s striking of the sworn declaration. Accordingly, we cannot consider the declaration as part of the evidence to be considered on appeal.”

No. 05-20-01116-CV (Oct. 11, 2021) (mem. op.)

Including deposition excerpts in a trial record can become complicated, and in American Pride Xpress Logistics v. Joe Jordan Trucks, it led to a preservation problem: “During appellee’s case in chief, it presented the testimony of Lee Cox, the attorney who prepared the deed ….  Cox testified through a videotaped deposition. Before the testimony was played for the jury, appellants’ attorney told the court, ‘We have asked that the court reporter not transcribe this portion since we’ve got a transcript of it.’ However, the transcript of Cox’s testimony was not made part of the record. Without Cox’s testimony, the reporter’s record is incomplete, and we must presume his testimony supported the trial court’s judgment.” No. 05-20-00281-CV (Sept. 24, 2021) (mem. op.).

Among other issues in Barcus v. Scharbauer, the Fifth Court affirmed the appellee’s testimony about the fair market value of certain artwork: “Appellants challenge the legal sufficiency of proof of commercially reasonableness of sales as proving market value and proving market value at a time over a year before the sales. … However, appellants do not dispute Mohle’s testimony that the sales were commercially reasonable or point to any evidence in the record that the sales were ‘out of the ordinary in some way.’ … A reasonable factfinder could decide Mohle’s testimony about the reasonably commercial sales conformed to the legal definition and theory of fair market value established by willing sellers and buyers under no compulsion.  A reasonable factfinder could credit Mohle’s testimony regarding the sufficient stability of the art market to conclude the sales in 2018 established fair market value a little more than a year earlier in 2016.”  No. 05-19-01121-CV (April 15, 2021) (mem. op.) (citations omitted). (My LPHS colleagues Eric Pinker and Paulette Miniter represented the successful appellee in this case.)

In a premises-liability case, the defendant challenged the expert testimony relied upon by the plaintiff. The Fifth Court rejected the challenge, reasoning: “Essentially, United contends that because English’s opinions have been excluded by other courts, we should “follow the lead” of these other courts and not consider them. We reject United’s invitation. United has not cited to any specific conclusory statements in English’s report. Rather, United argues that English’s report is conclusory because he provided a ‘cut-and-paste job’ that is a ‘rather generic’ opinion that ‘he regurgitates every time he
is hired.’ However, such statements provide no particular basis for United’s
objection. Objections that statements are conclusory may not be conclusory
themselves.” McIntyre v. United Supermarkets, No. 05-19-01252-CV (Feb. 4, 2021) (mem. op.).

A helpful summary of the requirements for proving up a mandamus record appears in In re Gentry:  “Documents become sworn copies when they are attached to an affidavit or to an unsworn declaration conforming to section 132.001 of the Texas Government Code. The affidavit or unsworn declaration must affirmatively show it is based on relator’s personal knowledge. The affidavit or unsworn declaration is insufficient unless the statements in it are direct and unequivocal and perjury can be assigned to them. An affidavit or unsworn declaration would comply with the rule if it stated, under penalty of perjury, that the affiant has personal knowledge that the copies of the documents in the appendix are true and correct copies of the originals.” No. 05-19-01283-CV (May 18, 2020) (mem. op.)

After a jury trial, Mumford was declared to be a sexually violent predator and then civilly committed. Dr. Turner, a psychologist, interviewed him and prepared a written report. The trial court struck, for procedural reasons, another expert who the State planned to call at trial, and then allowed the State to offer Dr. Turner’s written report in evidence. The Fifth Court reversed, finding that the report was prepared in anticipation of litigation (the commitment proceedings) and thus was not admissible as a business record. As to harm, it said: “Dr. Turner’s report was the only evidence that appellant ‘suffers from a behavioral abnormality that makes the person likely to engage in a predatory act of sexual violence.’ Without evidence to support that finding, the jury could not have found
appellant was a sexually violent predator.” In re Mumford, No. 05-19-00186-CV (March 31, 2020) (mem. op.)

While mandamus litigation often focuses on whether a clear abuse of discretion occurred, the other relevant factors can also be dispositive. Consider the panel majority in In re Alpha-Barnes Real Estate Services LLC, which observed: “While the trial court’s order presents an error potentially justifying reversal on a direct appeal, has failed to demonstrate the inadequacy of an appeal, particularly given the limited scope of the order and alternative mechanisms by which relator may introduce the same evidence excluded by the order.” It also relied upon laches, noting a lengthy and unexplained delay in seeking mandamus relief. A dissent would have granted the petition, noting the likely effect on the trial, and that the parties had entered a stipulation about the otherwise-unexplained delay.  No. 05-20-00073-CV (March 17, 2020) (mem. op.).

In re Johnson catches the eye as an atypical non-memorandum opinion in a pro se mandamus proceeding arising from a criminal case. The novel feature of the opinion is its footnote (longer than the actual opinion), using the Court’s “discretion to take judicial notice of adjudicative facts that are matters of public record” to review the relevant online docket sheet to establish mootness. No. 05-20-00068-CV (March 11, 2020)

A litigant requested that the Fifth Court take judicial notice of information about the address of an entity; the Court declined to do so: “That document is not part of the summary-judgment evidence. We decline to take judicial notice of the document. ‘The Court of Appeals is not a trier of fact. “For us to consider evidence for the first time, never presented to the trial court, would effectively convert this Court into a court of original, not appellate jurisdiction.”‘ . . . Appellate courts may take judicial notice of documents outside the appellate record to determine their jurisdiction or to resolve matters ancillary to decisions that are mandated by law, such as calculation of prejudgment interest when the appellate court renders judgment. This case does not involve those situations.” Thornton v. Columbia Medical Center, No. 05-18-01010-CV (Sept. 12, 2019) (mem. op.).

The Fifth Court reaffirmed its treatment of an important procedural issue about the TCPA in Bass v. United Devel. Funding: “[F]ollowing our precedent, we only consider the pleadings and evidence in favor of the plaintiff’s case when determining whether it established the requisite prima facie proof. It is not this Court’s province to consider and weigh evidence submitted by Hayman to contradict UDF’s evidence.” No. 05-18-00752-CV (Aug. 21, 2019) (mem. op.):

A highly-practical part of  Texas procedure appears in Section 132.001 of the Civil Practice and Remedies Code, which says that an unsworn declaration may be used in place of an affidavit in most situations. That provision details the form that such a declaration should take. Following Hays Street Bridge Restoration Group v. City of San Antonio, 570 S.W.3d 697 (Tex. 2019), the Fifth Court found a declaration inadequate when it omitted the declarant’s birthdate and other specified information. Goldberg v. EMR (USA Holdings) Inc., No. 05-18-00261-CV (Aug. 22, 2019). (This case’s other holdings about the scope of the TCPA were significantly revised on rehearing in January 2020, as described in another blog post.)

The Mian Devel. Corp. v. State of Texas involved an epic “battle of the experts” arising from the condemnation of some parking for the Sterling Hotel, a large hotel complex on I-35 near downtown Dallas. The hotel’s owners offered experts calculating compensation of $13,600,101 or $19,100,000; the State offered experts calculating compensation at $1,027,927 or $764,970, and also called an expert who said the Sterling was an unviable business. The jury awarded damages of $1,186,350 and the owner appealed. The Fifth Court affirmed in a detailed review of these experts’ testimony, discussing, inter alia: (1) the line between unreliable methodology (admissibility) and material for cross-examination (weight) (pages 10-11); (2) the concept and legal definition of fair market value (page 13); (3) five evidentiary issues about objecting to discussion of material relied upon by an expert (pages 18-19); and (4) throughout, the accepted methodologies and data resources used in this area of law. No. 05-17-01385-CV (July 18, 2019) (mem. op.).

Not offered in evidence? Might not be a problem, at least on the following record::

On appeal, the Pelley parties argue that the evidence is legally insufficient to support the award because there was no sworn expert witness testimony, neither of the “two exhibits which the attorney for the Wynne Parties handed to the court reporter to be marked . . . were ever offered into evidence by the [Wynne parties], nor were they ever admitted into evidence by a ruling of the Trial Court.” They also contend that even if the statements by the Wynne parties’ counsel had been properly presented to the trial court, his assertions “would have been objected to as being unreliable, and should have been excluded as evidence.” [1] The Pelley parties, however, did not object to, but rather discussed, the Westfall affidavit in their arguments in the trial court. [2] Nor did the Pelley parties object to the Wynne parties’ references to Westfall’s billing records on the basis they were not in evidence. The reporter’s record clearly shows that the parties and the trial court treated the Westfall affidavit and attached billing records as if they had been admitted into evidence. We conclude that the Westfall affidavit and attached billing records were, “for all practical purposes, admitted.”

Pelley v. Wynne, No. 05-18-00550-CV (June 13, 2019) (emphasis and colorful highlighting added).

“Appellants did not request an evidentiary hearing on their motion for attorney’s fees even though Denney stated in her response that an evidentiary hearing is required before sanctions may be imposed. Her attorney stated at the hearing that he was prepared to offer testimony in response to appellants’ request for sanctions.  Appellants, however, never offered any evidence at the hearing and never objected to  the lack of an evidentiary hearing on their motion. . . .  On appeal, Dallas Metro and Net Worth’s rely on documents and portions of Denney’s deposition attached to their motion for attorney’s fees as evidence to support their claim. However, the documents and deposition testimony were never admitted into evidence. As a result, the documents were not before the trial court and cannot be considered as evidence on appeal.” Net Worth Realty USA v. Denney, No. 05-18-00336-CV (March 6, 2019) (mem. op.) (citations omitted, emphasis added).

Footnote 11 of the Texas Supreme Court’s recent opinion in West v. Quintanilla clarified the two distinct doctrines, each of which is commonly referred to as “the parol evidence rule”: “The contract-construction rule applies when a contract is written and unambiguous, and it prohibits consideration of oral or extrinsic evidence to modify or add to the contract’s terms. ‘[T]he construction of an unambiguous contract, including the determination of whether it is unambiguous, depends on the language of the contract itself, construed in light of the surrounding circumstances.’ By contrast, the parol evidence rule applies when a contract is written and integrated, and it precludes enforcement of any prior or contemporaneous agreement that is inconsistent with the written contract’s terms.” No. 17-0454 (Tex. Apr. 5, 2019) (citations omitted).

Silverado’s answer was stricken because, as an LLC, it could not proceed pro se. A default judgment resulted and Silverado affirmed. Among other holdings, as to Silverado’s challenges to the damages evidence, the Fifth Court held: “An objection that an affidavit in support of a motion for summary judgment contains hearsay is an objection to the form of the affidavit. To preserve this complaint for appellate review, Silverado was required to make the objection in the trial court and obtain a ruling from the trial judge. Because it did not retain counsel or otherwise appear as ordered, Silverado obviously did not make a hearsay objection in the trial court and, therefore, has waived its complaint on appeal.” Silverado Truck & Diesel Repair LLC v. Lawson, No. 05-18-00540-CV (April 3, 2019) (mem. op.) (citations omitted).

A default judgment was set aside in a restricted appeal because the plaintiff’s pleading did not establish that the debt at issue was unliquidated when the proof was conclusory:

RGD’s amended petition states, with respect to its sworn account claim, that a contract to purchase products was entered into by the parties, RGD thereafter provided goods to MG, and “all of the goods were not paid for.” RGD then cites to Exhibit “A” as a systematic record of “an account covering certain products sold by [RGD to MG].” Exhibit “A” contains a single page with several entries, none of which clearly identifies the items constituting the account. Nor does Exhibit “A” indicate that the amounts listed thereon are unpaid. The accompanying “Sworn Account Affidavit,” signed by RGD’s credit manager, merely proves up Exhibit “A” as a business record and, without more, avers in conclusory fashion that GM owes RGD “$17,131.23 plus interest.” Neither a contract nor invoices are attached.

MG Int’l Menswear v. Robert Graham Designs, No. 05-18-00517-CV (Feb. 15, 2019) (mem. op.).

Hearsay must be “offer[ed] in evidence to prove the truth of the matter asserted in the statement.” Tex. R. Evid. 801(d)(2). Conversely, if an “[a]greement was offered to show that an agreement had been made and what its terms were,” then “[]he [a]greement was not hearsay.” In re: M.S. , 115 S.W.3d 534, 543 (Tex. 2003). The recitals in a substitute trustee’s deed present a close choice between these two principles, which the Fifth Court has resolved in favor of admissibility: “The recitals in the trustee’s deed set forth the facts on which the foreclosure sale was based and are germane to the deed’s purpose,” and are thus not excluded by the hearsay rule. Mack v. Tuesday Real Estate LLC, No. 05-18-00105-CV (Feb. 5, 2019) (mem. op.)

The Fifth Court affirmed summary judgment for the plaintiff, in a suit to recover an unpaid credit card balance, based on a record with two exhibits

• “The first exhibit attached to the Bank’s motion for summary judgment consisted of three types of documents: (1) twelve consecutive monthly statements for the period of June 11, 2015, to June 10, 2016, with a final balance of $17,445.84, each listing Alqawariq as the account holder, showing he made charges and payments, and demonstrating the Bank assessed transaction fees and charged interest; (2) Alqawariq’s credit card agreement; and (3) an applicant details record concerning [personal identifying] information about Alqariq . . . .”
• “The second exhibit contained a business records affidavit attaching the final account statement for the period of May 11, 2016, to June 10, 2016, which showed a balance of $17,445.84. In the business records affidavit, the custodian of records stated that: ‘[Alqawariq] opened an account with [the Bank], or a predecessor in interest, for the purpose of obtaining an extension of credit [] and did thereafter use or authorize the use of the [a]ccount for the acquisition of goods, services, or cash advances in accordance with the customer agreement [] governing use of the [a]ccount. Further, [Alqawariq] has failed to make periodic payments as required by the [a]greement.”

Alqaqwariq v. Bank of America, No. 05-18-00392-CV (Feb. 4, 2019) (mem. op.)

In the first opinion by Justice Osborne discussed by this blog, Porter complained that he should have been awarded attorneys’ fees in a successful DTPA claim, noting that his attorney’s invoice was admitted without objection. Unfortunately, though: “Porter bore the burden of proving reasonableness. Consequently, on appeal, the question is not  whether A-1 objected to Porter’s failure to offer evidence of reasonableness, but whether the evidence in the record is sufficient to support the trial court’s implied finding that Porter did not meet his burden of proof.” As Porter did not offer evidence on this point besides the invoice itself, the trial court’s ruling was affirmed. Porter v. A-1 Parts, No. 05-17-01468-CV (Jan. 14, 2019) (mem. op.)

Swearingen sued her former employer, Gillar Home Health Care, for not accommodating her pregnancy-related disability. At trial, “liability turned on whether Swearingen sent Evelyn Zapalac, the supervisor who fired her, a doctor’s note to corroborate a medical-related absence or if Swearingen instead simply failed to report for work.” The trial court allowed the defense to read Zapalac’s deposition testimony rather than calling her live. The Fifth Circuit reversed and remanded. Swearingen v. Gillar Home Health Care LP, No. 17-20600 (Jan. 11, 2019) (unpublished).

While Zapalac lived 95.5 miles from the courthouse – 4.5 miles short of the 100-mile radius that makes a witness “unavailable” under Fed. R. Civ. P. 32 – the Court observed: “The Rule does not use a modifier such as ‘about’ or ‘approximately’ or ‘around.'” The Court further noted that this rule’s requirements have been “summarized . . . as prohibiting deposition testimony unless ”live testimony from the deponent is impossible or highly impracticable.'” And this error was harmful because “the only person who testified to knowing Zapalac did not receive the doctor’s note was Zapalac herself,” making “the harm . . . especially acute because liability inged on competing credibility determinations.”  Note that a different result would obtain in state court under Tex. R. Evid. 801(e)(1) which defines as a non-hearsay statement: “A Deponent’s Statement. In a civil case, the statement was made in a deposition taken in the same proceeding. ‘Same proceeding’ is defined in Rule of Civil Procedure 203.6(b). The deponent’s unavailability as a witness is not a requirement for admissibility.”

In a dispute about a DTPA exemption for transactions involving “more than $100,000,” the following testimony was sufficient to establish that amount. In addition to a business-records proveup of attached records, by affidavit, the witness “testified she directly supervised PMRG property managers, including supervision of the calculation and collection of rent and other amounts due from tenants under their leases in the building; produced or supervised the production of a ‘record of account,’ attached as exhibits to her affidavit, showing rent and other amounts appellants owed to Landlord under the Lease . . . .” And “[m]oreover, [she] testified in her deposition that she and ‘accounting’ reviewed the reconciliations relating to appellants’ bills before they went out. [And she] further testified records of ‘actual invoices or bills’ were in the ‘general ledger,’ which ‘shows every expense that was billed to that property throughout the year.'” Lakepointe Pharmacy v. PM Forney MOB LP, No. 05-16-01413-CV (Aug. 14, 2018) (mem. op.)

In a dispute about whether photographs were properly authenticated as summary judgment evidence, the Fifth Court summarized the current state of preservation law after a recent Texas Supreme Court opinion: “To preserve a complaint for appellate review, a party generally must raise the issue in the trial court through a timely request, objection, or motion and the trial court must rule or refuse to rule on the issue. Tex. R. App. P. 33.1(a). The supreme court has specifically noted that, if a summary judgment affidavit suffers from a defect in form, ‘that flaw must be objected to and ruled upon by the trial court for error to be preserved.’ However, if a summary judgment affidavit presents a ‘substantive defect,’ the party may complain about the defect for the first time on appeal and is not subject to the general rules of error preservation. A complete absence of authenticating evidence is a defect in substance. However, a complaint that evidence was not properly authenticated is a defect of form.” Lee v. Global Gaming LSP, No. 05-18-00427-CV (July 31, 2018) (citations omitted, quoting Seim v. Allstate Texas Lloyds, No. 17-0488 (Tex. June 29, 2018).

In a civil commitment action under the Sexually Violent Predator Act, the appellant argued that the State’s expert was used as an impermissible “conduit” for unflattering factual information (inter alia, “records about appellant’s training and education, employment and medical histories, two prior sexual offenses, prison file, and a copy of the statutorily required MDT (Multi-Disciplinary Team) evaluation”). The Fifth Court rejected the argument, noting that the expert “was explaining the basis for his opinion using the type of information reasonably relied on by experts in his field (citation omitted),” and that “the trial court included a limiting instruction to further restrict the jury’s use of Turner’s opinion.” In re Commitment of Barnes, No. 05-17-00939-CV (July 20, 2018) (mem. op.)

The Fifth Court found a sufficient fact issue to reverse a summary judgment in 6200 GP LLC v. Multi Service Corp., in which an affiant’s testimony was found not to be conclusory when:

• his testimony about the relevant assignment was not conclusory, when his affidavit explained his roles in the businesses, his relationship to the transaction, and the business structure relevant to the transaction;
• an objection that the testimony “cite[d] no, let alone contemporaneous facts or document evidencing the alleged transactions or Prime’s intent” was not well-taken, since “[a] person may testify to a sale and assignment without providing any documentary evidence,” and the testimony as in fact supported by the witness’s understanding of “journal entries and [a] tax work sheet.”

No. 05-16-01491-CV (June 28, 2018) (mem.op.)

In a dispute about the propriety of an expert’s testimony in a medical malpractice case, the Fifth Court reminded that “the erroneous admission of evidence is harmless if it is merely cumulative,” found that “[the expert’s] testimony was not the only basis on which the jury could find that Rudman was not negligent,” and described three other witnesses who spoke to the relevant issue. As to the disputed opinion, then, ” its admission was harmless.” McPherson v. Rudman, No. 05-16-00719-CV (June 21, 2018) (mem. op.)

Wal-Mart v. Bishop affirmed judgment on a jury verdict against Wal-Mart arising from an in-store injury; among other issues, the Fifth Court addressed several challenges to closing argument. The discussion is practical and of broad interest to trial lawyers. The specific issues, as stated by Wal-Mart, were whether the trial court erred when it allowed plaintiff’s trial counsel “to make improper jury arguments that discussed theories of liability not submitted to the jury; characterized Walmart in a manner intended to inflame the passion of the jury; misled the jury as to the reason Walmart did not present evidence on the reasonableness and necessity of Bishop’s past medical expenses; and characterized conflicting sworn statements by Gajurel as constituting ‘perjury.'”

Tex. R. Evid. 503(d)(2), a long-lived but rarely-cited exception to the attorney-client privilege, applies “[i]f the communication is relevant to an issue between parties claiming through the same deceased client.” In In re: Rittenmeyer, the Fifth Court declined to grant mandamus relief as against an order to produce documents pursuant to this exemption, finding that – like the handful of other cases that have allowed such discovery – the case “involves a dispute between a decedent’s estate and a party who claims to be a beneficiary under the estate either through a subsequent will or because the probated will does not reflect the decedent’s intentions.”  No. 05-17-01378-CV (April 18, 2017) (mem. op.)

This is an example of an admission of fact, not a legal conclusion: “That the Commercial Truck suffered engine failure in Dallas, Texas and Plaintiff retained Defendants’ [sic] to rebuild the engine and perform additional repairs.” Garcha v. Chatha, No. 05-17-00084-CV (Apr. 12, 2018) (mem. op.)

The case of Starwood Management v. Swaim returned to the Fifth Court, after a reversal and remand by the Texas Supreme Court. The previous Fifth Court opinion affirmed a defense summary judgment, finding that the affidavits of the plaintiffs’ causation experts in a legal malpractice were conclusory. The Texas Supreme Court held otherwise. Against that backdrop, on remand, the Fifth Court found that the affidavits were not “speculative” (a concept arguably distinct from being “conclusory”) and was relevant, and reversed the summary judgment that had resulted from these rulings and the one addressed by the supreme court. No. 05-14-01218-CV (March 20, 2018) (mem. op.)

Pappas testified about his 50% interest in a car wash business, using an undisputed sale price for the business, undisputed evidence about the face amount of a relevant note, and corrobrating his calculation with a recent property appraisal that was admitted without objection. This foundation was sufficient to satisfy “the presumption that an owner is familiar with his property and its value,” which requires that “the owner must provide the factual basis on which his opinion rests, although this burden is not particularly onerous in light of the resources available today.”  Wash Technologies v. Pappas, No. 05-16-00633-CV (Feb. 6, 2018) (applying Natural Gas Pipeline Co. v. Justiss, 397 S.W.3d 150, 157 (Tex. 2012)).

A civil forfeiture action arising from a criminal conviction produced a succinct reminder about review for evidentiary sufficiency: “Wife’s testimony was equivocal, and the trial court was free to disbelieve her. See McGalliard v. Kuhlmann, 722 S.W.2d 694, 697 (Tex. 1986) (fact finder may believe one witness and disbelieve others).” One 2007 Lexus v. State, No. 05-16-01296-CV  (Jan. 8, 2018) (mem. op.)

In Nu-Build & Assocs. v. Sooners Group, LP, the Fifth Court drove home a recent holding about damages for cost of completion: “We agree because (i) a party seeking completion cost damages in tort and contract cases must prove that those costs are reasonable; and (ii) proof of amounts charged and paid, alone, is no evidence the payment was reasonable. Because Sooners adduced no evidence that the $3.6 million it paid to complete project was reasonable, we sustain Nu-Build’s fourth issue and [reverse and render].Mustang Pipeline Co., Inc. v. Driver Pipeline Co., Inc., 134 S.W.3d 195, 200–01 (Tex. 2004) (per curiam); 701 Katy Bldg., L.P. v. John Wheat Gibson, P.C., No. 05-16-00193-CV, 2017 WL 3634335, at *9 (Tex. App.—Dallas Aug. 24, 2017, no pet. h.) (mem. op.).

Defendants moved to compel arbitration, admitting that they could not find the relevant construction contract, but stating in an affidavit that it would have used a standard form that contained an arbitration clause that would govern the matter in dispute. The trial court denied their motion; the Fifth Court reversed, noting two technical issues. First, while plaintiffs objected to various parts of the affidavit, “appellees did not obtain a
ruling on this objection. An objection that an affidavit contains hearsay is an objection to the form of the affidavit. The failure to obtain a ruling from the trial court on an objection to the form of an affidavit waives the objection.” Second, while plaintiffs provided their own affidavits “stating they ‘do not recall’ signing any documents other than documents relating to financing and ‘do not recall’ signing documents requiring arbitration” – “To have probative value, an affiant ‘must swear that the facts presented in the affidavit reflect his personal knowledge[,]’ so “[a]n affiant’s belief about the facts is legally insufficient.” Ladymon v. Lewis, No. 05-16-00776-CV (July 21, 2017) (mem. op.)

Abdul Khan had a dispute with a contractor about the design of a stone medallion for the foyer for his new home. The dispute went to trial and the following Q-and-A occurred during examination of a witness for the contractor:

Q. Okay. And did you have a conversation with them about whether or not you could duplicate one of those medallions?

A. Yes, and I repeated that — They — They repeated to me that this was only a design that they were interested in because they did not want cherubims and angels because — what I surmised by that was for religious readons and —

[Khan’s counsel] Objection; relevance.

THE COURT: Sustained.

Khan argued that this exchange was an attempt to appeal to religious prejudice by identifying him as a Muslin. The Fifth Court agreed that the comment was improper, as “[c]ourts in this state have long recognized that a person’s religious beliefs have no place in determining the merits of a dispute,” but found that “[t]his single reference to Khan’s religion was not extreme” as to amount to incurable error. Khan v. The Chai Road, Inc., No. 05-16-00346-CV (July 17, 2017) (mem. op.)

In D Magazine Partners LP v. Rosenthal, reviewing the work of the Dallas Court of Appeals in a high-profile anti-SLAPP case, the Texas Supreme Court observed about Wikipedia:

“Given the arguments both for and against reliance on Wikipedia, as well as the variety of ways in which the source may be utilized, a bright-line rule is untenable. Of the many concerns expressed about Wikipedia use, lack of reliability is paramount and may often preclude its use as a source of authority in opinions. At the least, we find it unlikely Wikipedia could suffice as the sole source of authority on an issue of any significance to a case. That said, Wikipedia  can often be useful as a starting point for research purposes. In this case, for example, the cited Wikipedia page itself cited past newspaper and magazine articles that had used the term ‘welfare queen’ in various contexts and could help shed light on how a reasonable person could construe the term.”

But, as a matter of the relevant substantive law, and the nature of Wikipedia, the Texas Supreme Court found overreliance on a Wikipedia entry when “the court of appeals utilized Wikipedia as its primary source to ascribe a specific, narrow definition to a single term that the court found significantly influenced the article’s gist. Essentially, the court used the Wikipedia definition as the lynchpin of its analysis on a critical issue. . . . ”

Accordingly, Dallas-area practitioners should pay special attention to these statements, if online resources such as Wikipedia play more than a general background role in a legal argument. 

In Heritage Numismatic Auctions v. Stiel, a dispute about the the sale of rare coins, the Fifth Court affirmed the denial of a motion to compel arbitration, finding that the relevant documents were not adequately proved up by the sponsoring affidavit. The witness “did not testify that the documents in Exhibit F were ‘true and correct’ copies of the contracts or otherwise state that they were the originals or exact duplicates of the originals.” While the affidavit began with the phrase, “The facts contained herein are true and correct,” the Court held that “[t]he trial court could interpret this statement as asserting the factual averments in the affidavit were true and correct but not asserting the documents in Exhibit F were the originals or exact duplicates of the originals as required by Rule 902(10)(B)(2).” Finally, from a general description of the documents as “the various Terms and Conditions . . . ,” the Court held that “[t]he trial court could have concluded that [the witness’s] statement did not constitute testimony that the documents in Exhibit F were the originals or exact copies of the contracts.” No. 05-16-00299-CV (Dec. 16, 2016) (mem. op.)

While affirming a $4 million judgment related to a truck accident – most of which involved a series of Daubert challenges — the Fifth Court provided some rare appellate guidance about the use of video animation in the courtroom. Specifically, Smith – the plaintiff’s accident reconstruction expert – prepared an animation to accompany and illustrate his testimony about how the accident occurred.

The Court found no error. As to foundation, it said: “As to the video animation, we note the video was not admitted into evidence but was shown during Smith’s testimony for demonstrative purposes. Defense counsel objected ‘on the grounds of 403.’ Smith testified he measured Gaston’s truck and two similar trailers ‘in order to get data to fill in the animation.’ It was not possible to ‘match tire to track,’ but Smith made a generalized analysis of marks on the roadway he described as an ‘approximation.’ Smith testified the animation was not a simulation and ‘not an exact replication of what happened,’ but it was ‘an accurate representation of what occurred.’”

As to admissibility and waiver, it held: “Earlier in the trial, Smith was allowed to express his underlying opinion without objection when the testimony was presented to the jury. Since the animation was a graphic depiction of the opinion admitted into evidence without
objection, Greenwood’s trial objection to the video depiction of that opinion was waived. Video animation and other demonstrative evidence that ‘summarize, or perhaps emphasize, testimony are admissible if the underlying testimony has been admitted into evidence, or is subsequently admitted into evidence.'” (citations omitted) Greenwood Motor Lines v. Bush, No. 05-14-01148-CV (Aug. 17, 2016).

1. “A statement that makes up the parties’ contact is an operative fact, a necessary part of a cause of action, and is not hearsay.”
2. “A document created by one business may become a record of a second business if the second business determines the accuracy of the information generated by the first business.”
3. A document is not hearsay when “it represents the legally operative fact of demand, a necessary part of [a] breach of contract case.”

Humphrey v. Yancey, No. 05-15-00653-CV (June 30, 2016) (mem. op.)

Cross moved for summary judgment on limitations, submitting this affidavit: “My name is John K. Cross. I am at least 18 years of age and of sound mind. I have personal knowledge of the facts alleged in Defendant’s Second Motion for Summary Judgement. I hereby swear that the following statements in support of Defendant’s Second Motion for Summary Judgment are true and correct.  The mortgage at issue in this case was a secondary mortgage on a home I owned in Massachusetts. The primary holder foreclosed on the property, and it was sold  at foreclosure sale on July 14, 2010 per the correspondence I received from the mortgage holder’s attorney on May 28, 2010.”

Unfortunately for Cross, “[a]n affidavit that, on its face, establishes the affiant’s lack of personal knowledge is a defect of substance that may be raised for the first time on appeal.”  Here, “Cross’s affidavit affirmatively demonstrates his lack of personal knowledge on its face with respect to the date of the foreclosure sale. Cross attested only to what the May 28th letter told him.”   Old Republic Ins Co. v. Cross, No. 05 14-01204-CV (Dec. 7, 2015) (mem. op.) (The opinion is not completely clear on the identity of the parties, but it appears that the “mortgage holder” in the letter was not Cross’s party-opponent in this litigation, so that doctrine was not discussed.)

After the real estate bubble burst in 2008, borrowers attempted all sorts of ways to get out of their obligations. Most notably, debtors repeatedly challenged the ways that their mortgages had been transferred and recorded (or not) by the banks that had held, swapped, sold, and securitized them. Long story short, it hardly ever worked, as courts across the country mostly (but not always) eschewed technical arguments in favor of the big picture of who owed what to whom. But a new opinion from the Dallas Court of Appeals shows that when the bank doesn’t follow the rules in litigation, the debtors may still escape liability on a loan.

In this instance, a pair of individual guarantors for a $748,000 loan were sued by Wells Fargo after the borrower defaulted. While the case was pending, Wells Fargo allegedly assigned the loan documents to another entity, Apex. Wells Fargo’s attorneys later filed a motion for withdrawal and substitution, which the trial court granted. The motion failed to mention the assignment of the loan documents to Apex. The guarantors then filed for no-evidence summary judgment, pointing out that Wells Fargo had conducted no discovery and that the discovery period was closed. The motion argued that there was no evidence to show who owned the guaranty. When Apex appeared and tried to cure that deficiency, the guarantors objected and moved to strike Apex’s summary judgment evidence. The trial court sustained the objections and granted summary judgment. The Court of Appeals affirmed, holding that it was not an abuse of discretion to exclude Apex’s evidence because it had waited 11 months after acquiring the loan to amend Wells Fargo’s discovery responses by disclosing its ownership. That was not “reasonably prompt,” and it acted as an unfair surprise to the guarantors to have that come out only in response to their summary judgment motion.

LSREF2 Apex (TX) II, LLC v. Blomquist, No. 05-14-00851-CV

A surveying company named TBE Group contracted with a competing surveying company, Lina T. Ramey & Associates, to locate utility lines for transportation and construction projects. After one lawsuit, the parties entered into a “Strategic Alliance Agreement” that would govern their ongoing relationship. But Ramey did not generate the amount of business required by the agreement, and the parties sued one another for breach of contract. The trial court granted TBE’s motion for summary judgment and the Court of Appeals affirmed, holding that Ramey had failed to come forward with more than a scintilla of evidence that it had fulfilled its part of the contract. Although Raney’s summary judgment affidavit referenced checks that were supposed to demonstrate Raney’s performance, the checks were not attached to the affidavit. That failure rendered the affidavit conclusory and of no evidentiary value.

Lina T. Ramey & Assocs., Inc. v. TBE Group, Inc., No. 05-13-01711-CV

The owner of “$8,074.68 in United States currency, forty ‘8 liner’ machines, three Walmart gift cards, and miscellaneous paperwork” appealed a judgment of civil forfeiture, challenging the admissibility of the search warrant affidavit that led to the property’s seizure. That police officer’s affidavit was “replete with hearsay,” but the Court of Appeals found that to be no impediment to the validity of the affidavit. Citing a string of Court of Criminal Appeals and Dallas Court of Appeals cases, the Court held that in presenting the facts to support a search warrant, police officers are permitted to rely on the observations of other persons. And because the affidavit had already been relied upon as probable cause by the magistrate who issued the search warrant, the burden was already shifted to the owner to show cause why the property should not be forfeited or destroyed. Thus, as the Court of Appeals memorably states it, “the State did not have a burden to show probable cause at the show cause hearing.”

$8,074.68 in United States Currency v. State, No. 05-13-01502-CV

The plaintiffs defaulted on their mortgage and were then removed from the house via a forcible detainer action filed in Collin County.  They appealed, arguing that the trial court erred by admitting as a business record several notices of eviction sent to them in the mail.  The plaintiffs’ primary argument was that the witness who laid the foundation through an affidavit was not qualified.  The Dallas Court of Appeals disagreed, noting that “Rule 803(6) does not . . . require a witness laying the predicate for introduction of a business record to be the creator of the document or even an employee of the company keeping the record.” All that is required is that he/she have personal knowledge of the facts contained within the business record.

Singha v. FNMA

Two years ago, the Dallas Court of Appeals ruled that PlainsCapital Bank was not entitled to judgment against a borrower because it based its deficiency claim on the price it obtained when the property was sold a year after foreclosure, rather than the fair market value of the property at the time it was foreclosed. Last summer, the Texas Supreme Court granted the bank’s petition for review and set the case for oral argument. This morning, the Supreme Court held that the Court of Appeals was correct in ruling that § 51.003 of the Texas Property Code controlled PlainsCapital’s deficiency claim. However, the Court also ruled that “fair market value” under the deficiency statute does not mean the price that a willing buyer would pay to a willing seller at the time of foreclosure. Because § 51.003(b)(5) permits the trier of fact to consider the forward-looking factor of discounts that may be applied to a future sales price, it was proper for the trial court to base its fair market value finding on the price the bank actually received in its post-foreclosure sale. The Supreme Court remanded to the Court of Appeals for consideration of additional issues.

Justice Boyd (joined by Justice Guzman) dissented, arguing that the majority had improperly cast aside the historical definition of fair market value, and that evidence of any future discounts in the sale price of the property was only relevant to consideration of the fair market value at the time of the foreclosure.

TLDR: To determine FMV at the time of foreclosure, you can look to values received in the future.

PlainsCapital Bank v. Martin (majority)

PlainsCapital Bank v. Martin (dissent)

Just under two years ago, the Court of Appeals reversed summary judgment for Compass Bank because its custodian of records affidavit did not explain how the witness would have personal knowledge to prove up the promissory note. On remand, the trial court granted the bank’s amended motion for summary judgment, and this time that judgment was affirmed. Among other things, the defendants sought to establish a fact issue by pointing to a discrepancy in the amount of damages owed to the bank in the original summary judgment affidavit versus the affidavit in the amended motion. The Court of Appeals disposed of that issue by pointing out that it had already held the original affidavit to be “no evidence,” so the purported conflict was not really a conflict at all. The Court also held that the bank was not required to file the original promissory note, despite a Collin County local rule to that effect, because the local rule conflicted with the Texas Rules of Evidence governing the admissibility of a duplicate. Finally, although the lending instrument contained an illegal homestead warranty provision, the Court held that provision was severable from the remainder of the contract.

Vince Poscente Int’l, Inc. v. Compass Bank, No. 05-14-00165-CV

In this legal malpractice claim, the plaintiff argued that his expert opinion as to proximate causation were sufficient to establish that element of his claim.  But the Court of Appeals found that the plaintiff’s expert opinion had been excluded by the trial court as unreliable and the plaintiff did not assign error to that ruling in his appellate brief.

Kuzmin v. Schiller

In this complex fraud case arising out of the misappropriation of millions of dollars in loan proceeds, one issue before the Court of Appeals was whether the trial court erred in denying the plaintiff’s request for a spoliation instruction.  The plaintiff had moved to compel certain communications from one of the defendants, but that defendant had replaced its servers and did not back up the data.  Because there was no evidence that the defendant had acted with intent to conceal the discoverable evidence or acted negligently to irreparably deprive the plaintiff of “any meaningful ability to present its claims,” the Court of Appeals affirmed the trial court’s decision not to give a spoliation instruction to the jury.

Flagstar Bank, FSB v. Walker

In this restricted appeal of a default judgment, the Court found (among other things) insufficient evidence to support damages on a suit for breach of contract and on a sworn account.  The Court based its holding on the fact that there was contradictory information among the petition, the documents attached to the petition, and the business records filed.  In particular, the Court noted that there was no evidence of any amount owed by the defendant to the plaintiff.

Diaz v. Multi Service Tech. Solutions Corp.

The Plaintiff hired Classic Superoof to build a metal roof for her house, which it did. The appearance of the roof, however, was marred by markings and scuff marks.  As a result, Plaintiff complained to (and ultimately sued) Classic.  At first, Classic thought the problem stemmed from the metal itself and therefore contacted the metal company, who then, in turn, contacted U.S. Steel, the provider of the metals used to make the roof.  Looking to investigate the issue, U.S. Steel sent its own metallurgical engineer to the Plaintiff’s home to inspect the roof.  The engineer performed an inspection and (perhaps not surprisingly) concluded that the coating on the roof was damaged during installation (thus absolving U.S. Steel of any responsibility and pinning the blame on Classic).

At trial, the Plaintiff used the U.S. Steel report and won a judgment against Classic.  On appeal, Classic argued, among other things, that the trial court erred by admitting the report because it was hearsay–specifically, because it was prepared in anticipation of litigation, it fell outside the business records exceptions. The Court of Appeals rejected that argument, noting that the engineer was not contacted by the Plaintiff, there was no lawsuit on file at the time, and that the engineer testified that his job was simply to investigate the cause of the concern.

Classic Superoof v. Bean

For the second time this month, the Court of Appeals has decided that Oncor Electric Delivery Company was not responsible for causing a fire that damaged a plaintiff’s property. In this instance, Schepp’s Dairy alleged that Oncor’s negligence led to a fire starting with a transformer at Schepp’s facility. At trial, three different electrical engineering experts variously testified that the fire was caused on either Schepp’s side or Oncor’s side of the transformer. The jury specifically rejected the conclusions of two of those experts, leaving only one expert for Schepp’s. In a highly fact-specific opinion, the Court of Appeals held that the last expert’s opinion was unreliable. Among other problems, the witness had failed to exclude other possible causes of the fire, and he had only testified as to Oncor’s negligent maintenance of the transformer without opining as to what was the direct cause of the fire. Without that testimony, Schepp’s had no evidence of causation, and the judgment against Schepp’s was therefore reversed.

Oncor Elec. Deliv. Co. LLC v. So. Foods Gp. LLC, No. 05-12-01223-CV

An architectural firm subcontracted with Pavecon Commercial Concrete to pour the foundation for a wedding facility in Carrollton. The architect failed to pay the last of Pavecon’s invoices, prompting Pavecon to sue the architect and the owner of the facility. The defendants counterclaimed for breach of contract and negligence, alleging that the concrete services had been performed improperly. Pavecon moved for summary judgment on the counterclaims. The trial court granted the motion and the Court of Appeals affirmed, holding that the architect had failed to submit admissible evidence of any specific pecuniary loss and that the negligence claims were barred by the economic loss doctrine. Justice Moseley dissented in part, arguing that the trial court should not have sustained Pavecon’s objection that the defendants’ summary judgment affidavit was conclusory in averring their damages.

Trebuchet Siege Corp. v. Pavecon Commercial Concrete Ltd., No. 05-12-00945-CV

Trebuchet Siege Corp. v. Pavecon Commercial Concrete Ltd. (dissent)

The Court of Appeals has issued a lengthy opinion affirming the denial of a special appearance. The appeal arises out of an apparently contentious case involving claims and counterclaims for breach of contract, fraud, and defamation. Defendant Sebastian Lombardo — an Italian citizen who lives in Belgium and works in France — challenged personal jurisdiction by invoking the fiduciary shield doctrine, which protects officers of corporations from being personally haled into court in Texas due to their contacts as representatives of the corporation. Unfortunately for Lombardo, his argument in the trial court had presented that issue as a matter of general personal jurisdiction, and the trial court had found him to be subject to specific personal jurisdiction. Having failed to present the fiduciary shield doctrine as a bar to the exercise of specific personal jurisdiction, the issue was also waived on appeal. The opinion goes on to affirm the legal and factual sufficiency of the evidence supporting the trial court’s findings of jurisdictional facts, as well as its application of the law to those facts, and therefore affirmed denial of the special appearance.

Lombardo v. Bhattacharyya, No. 05-13-01583-CV

Last month, we noted an opinion that teased, but did not answer, an interesting question: Does Chapter 74 of the Civil Practice & Remedies Code require a plaintiff to produce an expert report for a breach of contract claim arising out of the provision of medical services? The Court of Appeals has now issued an amended opinion in that same case that addresses that very issue. While still holding that the defendant/counterclaimant had failed to preserve error by failing to make a proffer of the excluded evidence — namely, that his mother had been placed in a straitjacket despite the assisted-living facility’s contract stating that it was a “restraint-free community” — the revised opinion adds a new section on the expert report issue. The Court now concludes that even if the evidentiary issue had not been waived, the trial court still properly excluded that evidence because it was still a healthcare liability counterclaim that required the defendant to produce a Chapter 74 expert report. Since the defendant failed to do so, the trial court did not abuse its discretion in excluding evidence of the resident being placed in restraints.

Ferguson v. Plaza Health Servs. at Edgemere (amended opinion), No. 05-12-01399-CV

Hidden within this seemingly straightforward post-foreclosure forcible detainer action is an interesting evidentiary issue.  After purchasing the Martins’ home at a foreclosure sale, Fannie Mae sought to have them evicted by filing a forcible detainer action in County Court at Law.  The trial court ruled in favor of Fannie Mae, and the Martins appealed, arguing, among other things, that Fannie Mae did not introduce evidence to establish that it owned the property.

That issue turned on whether the substitute trustee’s deed (which showed that Fannie Mae owned the property) was admitted into evidence.  Apparently, when Fannie offered the substitute trustee’s deed into evidence, the Martins’ attorney objected to the second page of the document on the basis of hearsay and the trial court sustained his objection.  Later, however, Fannie’s attorney discussed and summarized the relevant provisions of the deed and made arguments about the deed as if it had been admitted into evidence.  Notably, the Martins’ attorney never objected to these statements, leading the Court of Appeals to conclude that the substitute trustee’s deed was, “for all practical purposes,” admitted into evidence.  Accordingly, the Court affirmed the trial court’s ruling.

Martin v. Fed. Nat’l Mtg. Ass’n

We depart from our usual fare of commercial litigation to spotlight a candidate for inclusion in future family law textbooks (or at least study materials for the Texas Bar Exam). To establish a common law or “informal” marriage, the claimant has to prove (1) the couple agreed to be married, (2) after that agreement they lived together in Texas as husband and wife, and (3) they represented to others that they were married. After Joseph Marek died intestate, Deborah Anderson intervened in the probate of his estate, claiming she and Marek had an informal marriage. The probate court sided with Anderson. Marek’s sister appealed, challenging the sufficiency of the evidence that the couple had an agreement to be married and represented to others that they were married.

The Court of Appeals conducted a detailed review of the evidence and affirmed the trial court’s judgment. The proof that Marek and Anderson had held themselves out as married was conflicting, but the trial court was entitled to resolve that conflicting evidence in favor of Anderson. The seemingly closer issue was whether Marek and Aderson actually had an agreement to be married. Anderson testified that agreement came when she returned to Marek’s house (colorfully, from an illegal gambling parlor) after a period of separation. Anderson testified that Marek asked her “Are you here for good, Babe?” and she responded “Yes.” The Court held that this testimony alone was not specific enough to establish anything more than an agreement to cohabitate. Nevertheless, it was still circumstantial evidence that, combined with all the evidence that the couple had actually lived their lives as husband and wife (including six years of “Married, Filing Jointly” tax returns), served to establish an agreement to be married. Thus, it appears that evidence of a couple acting as if they are married, and representing themselves to be married, can also establish the required element of an actual agreement to be married.

In re Estate of Marek, No. 05-13-01008-CV

A memorandum opinion teases, but does not answer, an interesting question: Does Chapter 74 of the Civil Practice & Remedies Code require a plaintiff to produce an expert report for a breach of contract claim arising out of the provision of medical services? Margaret Miller’s son placed her in a “skilled nursing resident program” at Plaza Health Services and contractually agreed to be the “responsible party” for payment. Among other things, the contract provided that the facility was a “restraint-free community,” and that no restraints of any type would “be used as punishment or as a substitute for more effective medical nursing care or for the convenience of the community staff.” After the nursing facility sued for unpaid bills, he he counterclaimed for breach of contract, DTPA, and medical negligence claims. The negligence claims were dismissed due to the failure to file a medical expert report, and the trial court granted a motion in limine to exclude evidence of restraints or straitjackets used on Ms. Miller. Unfortunately, error was not preserved on that issue due to the lack of a proper proffer of the excluded evidence. The grant or denial of a motion in limine does not preserve error by itself. If the motion is granted, the losing party must, during trial, (1) approach the bench and ask for a ruling, (2) formally offer the excluded evidence, and (3) obtain a ruling on the offer. Here, the appellants argued about the relevance of the evidence, but never actually offered it or obtained a ruling during trial on its admissibility. Accordingly, error was not preserved, and judgment for the nursing facility was affirmed.

Ferguson v. Plaza Health Servs. at Edgemere, No. 05-12-01399

Brian Vodicka and Steven Aubrey provided nearly $1 million for a loan to fund a real estate development. The loan was only secured by a subordinate lien, and Vodicka and Aubrey lost their entire investment after the borrower defaulted. They sued North American Title, which had served as the escrow agent for the loan, alleging a variety of fraud, negligence, and fiduciary duty claims. The Court of Appeals affirmed summary judgment for the title company. The Court held that the trial court had not erred in striking the plaintiffs’ summary judgment evidence. The trial court had not abused its discretion in sustaining the defendant’s objection to a spreadsheet because the plaintiffs had failed to file it under seal as required by the court’s protective order. The plaintiffs also waived their complaint about their summary judgment affidavit because their appellate briefing failed to address several of the objections the defendant had asserted before the trial court. Those rulings meant that the plaintiffs were left with literally no evidence to respond to North American Title’s no-evidence motion, and the trial court’s grant of summary judgment was therefore affirmed.

Vodicka v. N. Am. Title Ins. Co., No. 05-13-00126-CV

In 1986, Summers Electric Company extended credit to Stuart Electric, Inc., which backed its credit application with the personal guaranty of its owners, Barry and Zac Stuart. The guaranty was in favor of Summers or its assigns, for all money that may come to be due to Summers by Stuart Electric. Although Summers’ ownership and name changed over the years, Stuart continued to do business with the company.  In 2008, Barry and Zac sold Stuart Electric. The new ownership group continued to purchase materials from Summers, but failed to pay up. Summers turned to the Stuarts to make good on their 22-year-old written guaranty, which they refused. Summers then filed suit, obtaining a default judgment against Stuart Electric and a summary judgment against Barry and Zac.

On appeal, the Court of Appeals first sustained the trial court’s decision not to strike the Stuarts’ affidavits, in which they testified that Summers’ employees had told them they were no longer on the company’s account and were not responsible for any purchases made by Stuart Electric. Although the Stuarts were interested witnesses, their affidavits were still admissible because they were sufficiently “clear, positive, and direct, free from contradictions or inconsistencies, and could have been readily controverted.”  Tex R. Civ. P. 166(a)(c). That affidavit testimony also supported each of the elements of the Stuarts’ promissory estoppel defense, which precluded the trial court’s grant of summary judgment against them. The Court therefore reversed and remanded for further proceedings.

Stuart v. Summers Group, Inc., No. 05-12-00489-CV

As the Court held in a similar case two weeks ago, the recitals in a trustee’s deed fall into an exception to the hearsay rule and should be admitted into evidence because the recitals are “relevant to the purpose of the document.”

CitiMortgage v Sczepanik

In this forcible detainer case, the defendant objected to the entry into evidence of the deed at issue.  While stipulating to the deed’s existence, the defendant argued that the court should exclude the deed’s recitals because they were hearsay.  The Court of Appeals rejected this argument and pointed to Texas Rule of Evidence 803(15), which provides a hearsay exception to “a document purporting to establish or affect an interest in property.”  Because the Court found that the recitals were “germane to the purpose of the document,” it affirmed the trial court’s decision to admit the deed in its entirety.

Mason v. Wells Fargo Bank

With its motion for summary judgment, the plaintiff submitted affidavits testifying to, among other things, the terms of an unsigned lease agreement with its former tenant, a law firm.  The defendant generally objected to these affidavits as inadmissible hearsay, but failed to specify which portions of the affidavits contained the hearsay.  The Court of Appeals held that, although an affidavit containing hearsay may not support summary judgment, the opposing party must make “specific objections to each component part of a particular piece of evidence to preserve error on appeal.”  Because the defendant simply objected that “the Affidavits contain inadmissible hearsay,” the Court of Appeals held that they had not specifically objected to the allegedly inadmissible statements and concluded that the trial court properly considered the affidavits.

Stovall & Assocs. v. Hibbs Fin. Ctr., Ltd.

Parman sued TierOne to recover stock he allegedly owned in the company. The jury found that TierOne converted 4.5 million shares that belonged to Parman, and awarded him $600,000 in damages. TierOne appealed, arguing that the trial court erred by excluding evidence discovered after the trial began. TierOne received an audiotape after the second day of trial wherein Parman told another lawyer that “[No], man, I’ve got no stock [in TierOne], no nothing buddy.” TierOne produced the audiotape the next day, but the trial court denied TierOne’s motion to admit the tape.

Not surprisingly, the court of appeals determined that the trial court abused its discretion by refusing to admit the newly discovered audiotape of Parman admitting he doesn’t own any of the stock he was suing to recover from his employer. The court of appeals found that TierOne had good cause for failing to produce the audiotape before becoming aware that the lawyer who produced the tape had relevant information and becoming aware of the existence of the audiotape. The court also determined that TierOne supplemented its discovery responses reasonably promptly by producing the tape to Parman the day after TierOne received it. Finally, the court held that the trial court’s errors “probably caused the rendition of an improper judgment” because the audiotape likely would have impacted the weight the jury accorded Parman’s testimony. The court of appeals reversed the trial court’s judgment and remanded the case for further proceedings.

TierOne Converged Networks v. Parman, No. 05-12-00026-CV

Big D appealed from the denial of its motion for new trial following a no-answer default judgment. The court of appeals found that the trial court properly refused to set aside the default judgment.  Big D did not prove that its failure to answer was not intentional or the result of conscious indifference but was due to a mistake or accident.  Rollins properly served Big D by substituted service on the secretary of state after seven failed attempts to serve Big D’s registered agent at the agent’s registered office and home.  The substitute service on the secretary of state was not rendered void by the process being returned with the notation “Refused” because the secretary is not an agent for serving but for receiving process on the defendant’s behalf.  Big D also failed to show that the evidence was insufficient to support the amount of damages awarded by the trial court.  The court of appeals found that the car owner’s testimony regarding the “Blue Book” value of her vehicle was not so weak that the finding of damages was clearly wrong and unjust.  Thus, the court of appeals affirmed the trial court’s judgment.

Big D Transmission v. Rollins, No. 05-11-01019

UES sued Four D for failing to pay its invoices.  In support of its motion for summary judgment, UES attached an affidavit that established the amount due.  The trial court granted summary judgment in favor of UES, and Four D appealed.  Four D argued that fact issues exist on the amount owed on the account.  The court of appeals rejected UES’s argument that the affidavit could not support the summary judgment motion because it failed to meet the requirements of an interested witness affidavit.  The court found that UES waived this argument because it failed to obtain a ruling on its objection.  “Reasserting” the objection in UES’s motion for a new trial, which was subsequently overruled by operation of law, did not preserve the error.  However, the court agreed with Four D that invoices attached to the affidavit that were stamped “PAID” raised a fact issue as to the amount owed.  The court of appeals reversed and remanded.

Four D Construction v. Utility & Environmental Services, No. 05-12-00068-CV

In 2009, Andres Diaz paid $85,000 for his “dream car,” a 2010 Mercedes C63 AMG. Two weeks later, Caroline Culwell rear-ended him at a stop light, costing Diaz over $9,000 for repairs. At trial, Culwell stipulated to liability, leaving only the question of damages to be decided by the jury. Among other items, Diaz sought to recover $15,671 for the post-accident diminution in value of the car. That claim was supported by the testimony of Diaz’s appraisal expert, but the jury awarded $0.00 for diminished value. Diaz sought judgment notwithstanding that portion of the verdict, and the trial court awarded him the full amount of the claim. The court of appeals reversed, holding that it was within the province of the jury to disbelieve the appraisal expert’s testimony. Even uncontroverted expert testimony does not bind the jury unless the subject matter is one for experts alone. The court of appeals concluded that determining the value of a car for diminution of value damages is not so complicated that an expert’s testimony is required for the jury to understand the issue. Accordingly, the court of appeals reinstated the jury’s refusal to award Diaz any damages for diminution of value.

Culwell v. Diaz, No. 05-12-00093-CV

Citibank sued Albert Evans to collect approximately $10,000 in credit card debt. Evans appealed from the trial court’s grant of summary judgment for the bank, and the court of appeals affirmed. Among other things, Evans argued that he had never agreed to, or even seen, Citibank’s credit card agreement, that Citibank’s credit card statements were erroneous, and that the account statements were never delivered to him. However, the trial court struck those portions of Evans’ summary judgment affidavit as conclusory. The court of appeals held that the trial court had not abused its discretion in that evidentiary ruling, noting that Evans’ denials of the documents were not accompanied by any underlying facts or documentation that supported his denial. Without that affidavit testimony, Evans had no other evidence showing that he had not agreed to the amounts owed as shown by Citibank’s credit card statements, making summary judgment appropriate on the bank’s account stated claim.

Evans v. Citibank (S.D.), N.A., No. 05-11-01107

ICON appealed the trial court’s order denying their post judgment motion to enforce a pretrial protective order. ICON sought to prevent the City of Lubbock from publicly disclosing an audit of ICON’s administration of the City’s health care plan. The court of appeals concluded that the trial court’s ruling was not subject to direct appeal; the ruling was not a final judgment or an appealable order under a statutory exception. The court rejected ICON’s attempt to characterize the order as a request for injunctive relief or an order relating to the unsealing of court records. The court determined that the proper procedural vehicle to challenge the ruling is to seek mandamus relief. In the interest of judicial economy, the court treated the appeal as a petition for writ of mandamus.

The court of appeals held that the trial court’s order permitting disclosure of the audit contradicted the plain meaning of its earlier protective order. The audit was created using and analyzing protected materials, and the protective order prohibited public disclosure not only of protected materials, but also any knowledge or intelligence taken from or received by those protected materials.  Because the order denying ICON’s motion was a clear abuse of the trial court’s discretion, the court of appeals conditionally granted mandamus relief.

Icon Benefit Administrators v. Mullin, No. 05-11-00935-CV

Michael Malone, Jr. worked for Nationwide Recovery Systems, a commercial debt collector, but resigned and began working for a competitor named HHT Limited Company. Malone also convinced two of Nationwide’s other employees to move over to HHT. Nationwide sued HHT and Malone for tortious interference with existing contract and related claims, and the jury sided with Nationwide. On appeal, the defendants argued that the trial court had erred by admitting several summaries of Nationwide’s claimed damages. The court of appeals concluded that HHT had failed to explain how the summaries were based on improper accounting methods or were otherwise inadmissible. The court also rejected the defendants’ legal sufficiency challenge to the damages. Lost profits do not need to be susceptible of exact calculation, and the testimony of Nationwide’s president was based on years of experience and an established profit margin of 20 percent. That testimony was sufficient basis for the jury’s award of damages, and the court of appeals therefore affirmed the judgment.

HHT Ltd. Co. v. Nationwide Recovery Sys., Ltd., No. 05-11-01058-CV

In 2008, the mother of plaintiff Bich Nguyen purchased a life insurance policy from Allstate, representing that she had not been diagnosed with a lung disorder in the last 10 years or treated by a doctor in the last five years. The next month, the mother was diagnosed with lung cancer, and she died just a few months later. Allstate investigated, and found that the mother had a history of lung problems, treatment, and hospitalization. Allstate therefore rescinded the insurance policy, and Nguyen filed suit.

Allstate moved for summary judgment, and Nguyen responded with 650 pages of summary judgment evidence. Allstate objected, asserting that Nguyen had failed to meet her burden of actually demonstrating where her controverting evidence could actually be located in those voluminous documents. The trial court and the court of appeals both agreed. While Nyugen’s brief contained a 28-page “Real Factual Background,” that section failed to reference any of the summary judgment evidence in support of her version of the facts, and elsewhere simply referred generally to lengthy documents in support of her claims. Because citing generally to voluminous summary judgment evidence is not sufficient to raise an issue of fact to defeat summary judgment, and because Allstate had met its own summary judgment burden, the court of appeals affirmed the trial court’s decision.

Nguyen v. Allstate Ins. Co., No. 05-11-01120-CV

The court conditionally granted a writ of mandamus preventing disclosure of a “Confidential Quality Review Occurrence Report” protected by the medical committee privilege.  A visitor to the relator Hospital slipped and fell on Hospital premises, and sought damages in a premises liability suit.  The visitor sought production of all incident reports made by the Hospital related to her fall.  A two-page report titled “Occurrence Report Form” listed the visitor’s name and identifying information, the date and location of her fall, and a description of the occurrence and treatment provided; it was signed by a Hospital nurse.  The report also stated “Confidential Quality Review Committee Document (NOT PART OF MEDICAL RECORD).”  The Occurrence Reports are given to the Hospital’s quality review committee, which provides general governance for the Hospital’s quality of service.  The court held that the Hospital met the standard for claiming medical committee privilege through its privilege log and a doctor’s affidavit because the Occurrence Report was not created in the regular course of business and was not part of a patient’s medical file.  The court rejected the visitor’s argument that because this case involves a non-patient visitor, the medical committee privilege cannot apply.   Instead, the court found that the medical committee privilege is not limited to evaluation of occurrences relating only to direct patient care.

In re Methodist Dallas Medical Center, No. 05-13-00134-CV

Natalie Holmes, a graduate student at SMU, has taken and failed twice the graduate comprehensive exam (“GCE”)–which she needed to pass to receive her Master’s Degree in Music Education.  After both tests, Holmes appealed the results to SMU’s internal academic appeals board as either “arbitrary and capricious” or “beyond the scope of the coursework.”  SMU offered Holmes the chance to re-take the exam a third time, but Holmes refused and instead insisted that SMU giver her the degree as well as monetary damages.  While her second appeal remained pending, Holmes sued SMU for breach of contract, fraud and DTPA violations.  SMU moved to dismiss the case for lack of subject matter jurisdiction, arguing that Holmes had failed to exhaust her administrative appeal rights before bringing suit.  The trial court agreed with SMU and dismissed the case.

The Court of Appeals, however, reversed the trial court, finding that SMU had failed to submit any evidence to establish that Holmes was required to proceed through an administrative appeal before bringing suit.  According to the Court, SMU’s only evidence was a “short and conclusory” affidavit that did not address the appeals process, and this was not enough to establish that the trial court lacked jurisdiction.

Holmes v SMU

The court affirmed a summary judgment in favor of Citibank in a suit to recover a credit card debt. Citibank sued Aymett, alleging breach of contract and account stated, and moved for summary judgment. Citibank supported its motion with account statements and excerpts from Aymett’s deposition, in which Aymett admitted using the credit card and making payments for some time and agreed that he has no dispute as to the amount claimed to be due and owing on the account. The trial court granted summary judgment and Aymett appealed.

On appeal, Aymett complained that Citibank did not present a copy of a written contract and that there was no evidence he actually received any of the account statements mailed to him. The court held that a claim for account stated does not require a written contract, but only an agreement to pay an amount owed. Additionally, the summary judgment evidence demonstrated that Citibank mailed, to the same address for Aymett each time, monthly statements and that Aymett responded to the statements by making regular monthly payments until he finally stopped paying. Finally, the trial court did not err in granting summary judgment on an implied contract just because Citibank claimed an express contract based upon the same transaction, as there was no determination that Citibank was entitled to recover on both an express and an implied contract.

Aymett v. Citibank, No. 05-11-00451-CV

In this suit by Compass Bank to recover money owed under a promissory note, Compass moved for summary judgment.  To support its motion, Compass submitted an affidavit by a custodian of records attaching copies of the note and the trial court granted summary judgment.  The Court of Appeals, however, overturned the trial court’s ruling because it found Compass’s affidavit could not satisfy the personal knowledge requirement.  In particular, “[t]he affidavit did not demonstrate whether [the affiant] was employed by Compass, what her job position and responsibilities were, or how her job duties gave her personal knowledge of the facts.”

Vince Poscente Int’l v. Compass Bank

The court affirmed a take-nothing summary judgment in favor of DCAD in a property tax dispute. The property owner challenged the appraisal value of his property as both unequal and excessive. DCAD filed a no-evidence motion for summary judgment arguing that the appraised value was neither excessive nor unequal. In responsive briefing, the owner stated that its property manager and tax representative would testify that the appraisal values do not reflect the accurate market values, and attached an affidavit from him verifying the truth of statements in the response. The trial court granted summary judgment.

On appeal, the court held that the owner’s evidence failed because an affidavit in which a party attempts to verify the truth and correctness of all “allegations and facts” in a response to a motion for summary judgment is not competent summary judgment evidence. Moreover, the response did not state what the property manager believed the market value actually was or whether he would testify that the appraisal value was excessive or unequal. Therefore, the owner did not raise a fact issue and summary judgment was proper.

WOL+MED v. DCAD, No. 05-12-00011-CV

Almost nine years ago, the 68th District Court granted judgment notwithstanding the verdict against plaintiff Basic Capital Management and several related entities, wiping out a jury verdict in their favor for tens of millions of dollars in lost profits. The underlying dispute involved the failure of Dynex to fund an alleged $160 million loan commitment for Basic’s “Single-Asset, Bankruptcy Remote Entities” to make real estate investments. In 2008, the Dallas Court of Appeals affirmed that ruling, holding that the SABRE entities were not intended, third-party beneficiaries of the loan agreement, and that the lost profits from the contemplated real estate transactions were not foreseeable. In 2011, the Texas Supreme Court reversed that decision and remanded the case for consideration of Dynex’s argument that the damages were not supported by legally sufficient evidence. Now, in 2013, the court of appeals has held that, with one exception, there was legally sufficient evidence to support the jury’s original award of damages. The court went through a detailed analysis of the testimony of Basic’s damages expert, concluding that his testimony was sufficient to sustain the jury’s award of damages for the lost real estate investments Basic had envisioned. However, the court of appeals sustained the trial court’s grant of JNOV as to one item of damages — $252,577 awarded by the jury for “lost opportunity” on an investment that Basic had actually completed.

The saga of Basic v. Dynex is not over yet. In addition to the possibility of further appeal to the Supreme Court, the court of appeals also remanded to the district court for further consideration of Basic’s claim for attorney fees, as well as pre- and post-judgment interest. We’ll keep you posted if the case results in any further opinions on appeal.

Basic Capital Mgmt., Inc. v. Dynex Commercial, Inc., No. 05-04-01358-CV

The court vacated and reversed and rendered the trial court’s judgment in a forcible-detainer action awarding the Plaintiff possession of the property, damages, and attorney’s fees. The Daftarys commercial real estate lease with HSM expired in 2008, and they sought to exercise a three-year renewal option. The parties did not execute a written extension, but the Daftarys continued paying rent for over a year beginning in July 2008. In December 2009, HSM requested that the Daftarys either execute a new long-term lease or vacate, and when the Daftarys refused filed this forcible-detainer action. On the morning of trial, the Daftarys relinquished the keys to the property and tendered possession of the space to the court and then argued that the case was moot because it no longer presented an issue about which party was entitled to possession. The trial court proceeded to a bench trial, awarding HSM possession, damages for the rental difference, and attorney’s fees.

On appeal, the court held that the issue of possession was moot, but that HSM’s claims for damages and attorney’s fees incurred defending possession presented live controversies. HSM failed to show sufficient evidence of damages, however, because they only presented evidence that the property’s rental value had increased in July 2008, and presented no evidence of value in December 2009 when their right to possession accrued. And because the trial court lacked jurisdiction to consider the possession issue and erred by awarding HSM’s damages, HSM was no longer the prevailing party and could not collect attorney’s fees.

Daftary v. Prestonwood Market Square, No. 05-11-00673-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

In a memorandum opinion, the court affirmed a trial court’s judgment in a declaratory action regarding the validity of a warranty deed. Knight brought the underlying action to declare the deed, which evidenced the transfer of his ownership in property to Minter, a forgery. The trial court concluded that Knight had indeed signed the deed transferring ownership of the Property to Minter. On appeal, Knight argued that the trial court erred by denying his motion for new trial based on “newly discovered evidence,” including evidence that the notary who witnessed Minter’s warranty deed had been indicted for fraud and entered a plea agreement, as well as the affidavit of a mortgage loan underwriter stating the transaction required a sales contract. The court rejected Knight’s argument because he failed to establish that he lacked actual knowledge of the notary’s criminal history and exercised appropriate diligence before trial in relation to the expert testimony he obtained after trial.

Knight v. Minter, No. 05-11-00829-CV

In a short opinion, the court has granted mandamus to a manufacturer of medical devices after the trial court had ordered the manufacturer to produce three emails from its privilege log.  The opinion does not go into much detail about the documents, but quickly concludes that they were privileged because they consisted of communications among employees and the company’s in-house counsel made for the purpose of facilitating the rendition of legal services to the company.  Accordingly, the court concluded that it was an abuse of discretion to compel their production.

In re Blackstone Medical, Inc., d/b/a Orthofix Spinal Implants, No. 05-12-00763