Capital Consultants Management Corp. v. Redland Springs Association, Inc.--Appeal from 73rd Judicial District Court of Bexar County

MEMORANDUM OPINION
No. 04-03-00836-CV
CAPITAL CONSULTANTS MANAGEMENT CORP.,
Appellant
v.
REDLAND SPRINGS ASSOCIATION, INC.,
Appellee
From the 73rd Judicial District Court, Bexar County, Texas
Trial Court No. 2002-CI-12369
Honorable Pat Boone, Judge Presiding (1)

Opinion by: Phylis J. Speedlin, Justice

Sitting: Paul W. Green, Justice

Sandee Bryan Marion, Justice

Phylis J. Speedlin, Justice

Delivered and Filed: June 30, 2004

REVERSED AND REMANDED

Capital Consultants Management Corporation ("Capital Consultants") appeals a summary judgment granted in favor of Redland Springs Association, Incorporated ("Redland"). We reverse the judgment and remand for further proceedings.

Background

Capital Consultants is a property management company which, at times relevant to this suit, served as the managing agent for Redland, a property owners' association. Both Capital Consultants and Redland were named defendants in a separate lawsuit brought by a homeowner. During the course of the homeowner's litigation, Capital Consultants incurred attorney's fees and related expenses. Capital Consultants forwarded the fees and expenses to Redland for reimbursement pursuant to the terms of an "Agency and Management Agreement" between the parties. That agreement provides in relevant part:

HOLD HARMLESS

The Board agrees to hold the Managing Agent, its employees, agent and invitees harmless from all claims, damages losses and expenses, including reasonable attorneys' fees, arising from or out of any act of [sic] omission by the Board.

When Redland refused to remit payment, Capital Consultants instituted suit claiming breach of the indemnity agreement and, alternatively, unjust enrichment or implied contract. Redland moved for a traditional summary judgment. Capital Consultants timely amended its original petition and added a claim based on common law or equitable indemnity arising from its agent-principal relationship with Redland. Redland did not amend its summary judgment motion. After a hearing, the trial court granted the summary judgment without stating the grounds. This appeal followed.

Standard of Review

We review a grant of summary judgment de novo. Ingalls v. Standard Gypsum, L.L.C., 70 S.W.3d 252, 255 (Tex. App.--San Antonio 2001, pet. denied). When a trial court does not specify the grounds relied upon in granting summary judgment, the reviewing court must affirm if any of the summary judgment grounds are meritorious. FM Properties Operating Co. v. City of Austin, 22 S.W.3d 868, 872 (Tex. 2000). To be entitled to summary judgment, the movant must disprove at least one element of each of the plaintiff's claims as a matter of law. Black v. Victoria Lloyds Insurance Co., 797 S.W.2d 20, 27 (Tex. 1990). We view the evidence in the light most favorable to the non-movant, disregarding all contrary evidence and inferences. Randall's Food Markets, Inc. v. Johnson, 891 S.W.2d 640, 644 (Tex. 1995). We will affirm a summary judgment only if the record establishes there is no genuine issue of material fact, and the movant is entitled to judgment as a matter of law on a ground set forth in its motion. Tex. R. Civ. P. 166a(c); see Cathey v. Booth, 900 S.W.2d 339, 341 (Tex. 1995).

Common Law Indemnity Claim

On appeal, Capital Consultants first contends summary judgment was improper because Redland's motion for summary judgment did not address Capital Consultants' common law indemnity claim. The movant under a traditional motion for summary judgment must expressly set forth the specific grounds for the motion. Tex. R. Civ. P. 166a(c). Judgment as a matter of law cannot be granted on a cause of action not addressed in a summary judgment proceeding. Black, 797 S.W.2d at 27; see also City of Houston v. Clear Creek Basin Authority, 589 S.W.2d 671, 677 (Tex. 1979). Similarly, a summary judgment may not be affirmed on appeal on a ground not included in the motion. Jacobs v. Satterwhite, 65 S.W.3d 653, 655 (Tex. 2001).

The record confirms Redland moved for a traditional summary judgment on the basis that (1) contractual indemnity was unenforceable because the indemnity provision failed to comply with the express negligence doctrine, and (2) theories of implied contract or unjust enrichment were either barred by the statute of frauds or did not apply. Capital Consultants then timely amended its petition and added a claim for common law indemnity. Redland did not supplement its motion for summary judgment to address the additional claim of common law indemnity.

Texas recognizes both a contractual right to indemnity and a common law right to indemnity when a party's liability is purely vicarious. B&B Auto Supply v. Central Freight Lines, Inc., 603 S.W.2d 814, 817 (Tex.1980). Redland's summary judgment motion and evidence only addressed Capital Consultants' claim of contractual indemnity. Because Redland did not address, much less negate, any element of common law indemnity, summary judgment on that claim was improper.

Contractual Indemnity

In its second issue, Capital Consultants contends summary judgment on its contractual indemnity claim was also improper because the management agreement does not seek to indemnify Capital Consultants from its own negligence; therefore, the express negligence doctrine does not apply. We agree.

The express negligence doctrine provides that in order to relieve a person in advance from the consequences of his own acts of negligence, the contract must expressly state that intent in clear and unambiguous terms. Ethyl Corp. v. Daniel Constr. Co., 725 S.W.2d 705, 708 (Tex. 1987). The doctrine, however, only applies when a party seeks to be relieved of liability for its own future negligence. Dresser Indus., Inc. v. Page Petroleum, Inc., 853 S.W.2d 505, 508 (Tex. 1993). Because the contract language at issue in this case does not seek to indemnify Capital Consultants from its own negligence, but rather from the acts of another (Redland's Board), the express negligence rule does not apply. Gulf Ins. Co. v. Burns Motors, Inc., 22 S.W.3d 417, 424 (Tex. 2000). Since Redland did not negate any element of Capital Consultants' contractual indemnity claim, summary judgment on that claim was improper.

Implied Contract or Unjust Enrichment

Finally, Capital Consultants contends summary judgment on its alternative theories of implied contract and unjust enrichment was also improper. Again, we agree. Under traditional summary judgment standards, a party moving for summary judgment has the burden of establishing that no genuine issue of material fact exists and that the party is entitled to judgment as a matter of law. Casso v. Brand, 776 S.W.2d 551, 556 (Tex. 1989); Nixon v. Mr. Property Management Co., Inc., 690 S.W.2d 546, 548-49 (Tex. 1985). The summary judgment record reveals that Redland wholly failed to present any evidence negating the alternative theories pled by Capital Consultants.

We reverse the trial court's judgment and remand the cause for further proceedings consistent with this opinion.

Phylis J. Speedlin, Justice

1. The Honorable Andy Mireles is the presiding judge of the 73rd Judicial District Court, Bexar County, Texas. The Honorable Pat Boone, presiding judge of the 57th Judicial District Court, granted Redland's motion for summary judgment at issue in this appeal.