James W. Davis, Thomas B. Wilkinson, IV KET Enterprises, Incorporated, and Melissa Jones v. Scott Friedson ("Friedson")--Appeal from 80th District Court of Harris County
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Dismissed in Part; Affirmed in Part; Reversed and Remanded in Part; and
Memorandum Opinion filed March 11, 2010.
In The
Fourteenth Court of Appeals
___________________
NO. 14-08-01098-CV
___________________
JAMES W. DAVIS, THOMAS B.WILKINSON, IV, KET ENTERPRISES,
INCORPORATED, and MELISSA JONES, Appellants
V.
SCOTT FRIEDSON, Appellee
On Appeal from the 80th District Court
Harris County, Texas
Trial Court Cause No. 2005-81808
MEMORANDUM OPINION
This case arises from a dispute involving a real estate broker’s commission. Scott
Friedson challenges the trial court’s (1) order granting James Davis’s motion for partial
summary judgment on Friedson’s breach of contract and fraud claims; and (2) denial of
Friedson’s motion for continuance.
Davis appeals the trial court’s (1) dismissal of certain counterclaims without
prejudice for want of prosecution;1 and (2) denial of his motion to reinstate.
We dismiss in part; affirm in part; and reverse and remand in part.
Background
Friedson is a real estate broker with National Income Property. He alleges that
Davis entered a Commercial Buyer/Tenant Representation Agreement with him.
Friedson and Davis both signed the agreement. According to Friedson, this agreement
gave him the exclusive right to act as Davis’s real estate agent and to receive a broker’s fee
when Davis purchased the Woodlen Place property in Houston. Davis eventually bought
the Woodlen Place property directly from KET Enterprises, Inc., a real estate brokerage
firm, and Thomas B. Wilkinson IV, the owner’s listing broker.
Davis denies that he and Friedson entered an agreement. Davis contends that he
added a handwritten notation to the agreement stating that Friedson would look only to the
seller for his commission; Davis further contends that this notation amounted to a
counteroffer, which Friedson did not accept.
Friedson asserts that he accepted the
agreement including the notation, and that Davis nonetheless is obligated to pay Friedson’s
commission under a default provision in the agreement.
Friedson filed an original petition on December 29, 2005 asserting claims against
Davis for breach of contract, fraud and fraudulent inducement, and attorneys’ fees. Davis
filed a general denial; a verified denial claiming Friedson did not have the capacity to sue;
several affirmative defenses; and a counterclaim seeking a declaratory judgment that the
parties never had a meeting of the minds or, alternatively, that the agreement was void and
unenforceable.
1
Davis asserted a counterclaim seeking a declaratory judgment, along with counterclaims
asserting liability for DTPA violations, breach of contract, fraud, and attorneys’ fees. The declaratory
judgment counterclaim was dismissed in a summary judgment order, which Davis does not challenge on
appeal. Davis’s remaining counterclaims were dismissed for want of prosecution, which Davis does
challenge on appeal along with the trial court’s denial of his motion to reinstate.
2
On April 29, 2008, Davis filed a combined no-evidence and traditional summary
judgment motion. In the no-evidence portion of the combined motion, Davis asserted that
Friedson lacked evidence of (1) a binding agreement for Davis to pay a real estate
commission to Friedson; and (2) a breach of any such agreement because Davis did not
agree to pay Friedson a commission, and Friedson agreed to look solely to the seller for his
commission.
In the traditional summary judgment portion of the motion, Davis
contended that the agreement did not comply with the Real Estate License Act; there was
no meeting of the minds on a material term; and there is no cause of action for fraud absent
an enforceable agreement. On May 15, 2008, Friedson filed a motion for continuance of
the summary judgment hearing and trial date, along with a motion for leave to file an
amended complaint and reopen discovery; Friedson contended that he hired new counsel
on May 14, 2008 and needed additional time to prepare for the case. The trial court denied
Friedson’s motion for continuance on May 23, 2008.
Friedson filed a response to Davis’s motion for summary judgment on May 19,
2008, arguing that a valid written agreement existed between the parties; the agreement
satisfied the Real Estate License Act’s requirements for bringing suit to collect
commissions; the parties acted under the agreement; and Davis’s added term was of no
consequence because Davis agreed to pay Friedson’s commission in the event of default.
Friedson also asserted that Davis committed fraud by allowing Friedson to represent him
and then purchasing the property directly from the selling broker.
Friedson filed a first amended petition on June 5, 2008 adding National Income
Property as a plaintiff, and Thomas B. Wilkinson, IV, KET Enterprises Inc., and Melissa
Jones as defendants. The first amended petition added claims for tortious interference
with contract against Wilkinson, KET, and Jones, and claims against all defendants for
conspiracy and violations of the Theft Liability Act.
3
On June 13, 2008, the trial court signed an interlocutory order granting Davis’s
April 29, 2008 motion for summary judgment in its entirety. The order was interlocutory
because (1) Davis’s April 29, 2008 motion for summary judgment did not address
Friedson’s newly added claims in his June 5, 2008 first amended petition; and (2) the order
did not address Davis’s declaratory judgment counterclaim.
On June 17, 2008, Friedson filed a motion for summary judgment on Davis’s
declaratory judgment counterclaim. On August 1, 2008, Davis filed his first amended
original answer and first amended counterclaim, in which he added a claim against
Friedson under the Texas Deceptive Trade Practices-Consumer Protection Act along with
claims for common law fraud, fraud in a real estate transaction, breach of contract, and
attorney’s fees. Davis simultaneously filed his response to Friedson’s June 17, 2008
motion for summary judgment. On August 26, 2008, the trial court signed an order
granting Friedson’s motion for summary judgment and dismissing Davis’s declaratory
judgment counterclaim.
Other claims were resolved independently of the cross-motions for summary
judgment. In a letter dated June 24, 2008, the trial court stated that it intended to dismiss
the case for want of prosecution because no service had been had or no answer had been
filed in the case. The letter was addressed only to Friedson’s attorney; the body of the
letter was directed to “All Counsel and Pro Se parties.” The letter stated that the case
would be dismissed for want of prosecution unless a meritorious default judgment was
filed and heard or an answer was filed. If neither occurred, the trial court required the
filing of a verified motion to retain showing good cause or diligence in prosecution, along
with an appearance at a dismissal hearing scheduled for September 5, 2008.
On September 9, 2008, the trial court signed an order dismissing “the cause of
action” for want of prosecution after the parties failed to appear at the September 5
dismissal hearing. It is not clear from the order exactly what “the cause of action”
encompasses.
4
On October 2, 2008, Davis timely filed a verified motion to reinstate his
counterclaims after dismissal for want of prosecution under Texas Rule of Civil Procedure
165a, in which he stated that (1) he did not have notice of the dismissal docket setting or
order dismissing the case until September 19, 2008; and (2) unspecified new claims had
arisen in relation to his counterclaims against Friedson. On October 13, 2008, Friedson
filed a response and motion for sanctions, and a motion for rehearing of Davis’s second
motion for summary judgment subject to reinstatement of the case. The trial court denied
the motion to reinstate.2
On November 4, 2008, Davis filed a motion asking the trial court to sign a final
judgment. On November 14, 2008, the trial court signed a “Final Judgment” denying
Davis’s motion to reinstate and incorporating (1) the June 13, 2008 summary judgment
order dismissing Friedson’s claims for breach of contract and fraud; and (2) the August 26,
2008 summary judgment order dismissing Davis’s declaratory judgment counterclaim.
The “Final Judgment” recited that all remaining claims or counterclaims were dismissed
for want of prosecution in the order signed on September 9, 2008.
As of November 14, 2008, therefore, all of the parties’ claims had been resolved as
follows.
•
Friedson’s claims against Davis for breach of contract and fraud were resolved
when the trial court granted summary judgment in favor of Davis in an interlocutory
order signed June 13, 2008. The June 13, 2008 summary judgment order was
incorporated in the “Final Judgment” signed on November 14, 2008.
•
Davis’s declaratory judgment counterclaim against Friedson was resolved when the
trial court granted summary judgment in favor of Friedson in an interlocutory order
In a document entitled “Order Granting Partial Motion to Reinstate After Dismissal Without
Prejudice of Defendant’s Counterclaims Only and Reinstating Prior Granted Summary Judgments,” a line
is drawn through the proposed order and “Motion to Reinstate Denied” is written across it. The order is
dated October 24, 2008 and is signed by the trial court.
2
5
signed August 26, 2008. The August 26, 2008 summary judgment order was
incorporated in the “Final Judgment” signed on November 14, 2008.
•
The November 14, 2008 “Final Judgment” recites that “all other claims or
counterclaims, if any, remaining after the prior above mentioned Interlocutory
Summary Judgment Orders were granted, were dismissed for want of prosecution
on September 9, 2008.” This recitation disposed of Friedson’s and National
Income Property’s remaining claims for tortious interference against Wilkinson,
KET, and Jones; it also disposed of Friedson’s and National Income Property’s
claims for conspiracy and violations of the Theft Liability Act against Davis,
Wilkinson, KET, and Jones, along with National Income Property’s fraud and
breach of contract claims against Davis. Likewise, this recitation disposed of
Davis’s remaining counterclaims against Friedson for DTPA violations, common
law fraud, fraud in a real estate transaction, breach of contract, and attorney’s fees.
•
The November 14, 2008 “Final Judgment” is final and appealable because it
confirms the trial court’s intent to resolve all claims asserted by or against all parties
when it states, “This judgment finally disposes of all remaining claims and parties,
if any.” See Lehmann v. Har-Con Corp., 39 S.W.3d 191, 200 (Tex. 2001).
A notice of appeal was filed on December 1, 2008 by Davis, Wilkinson, KET, and
Jones. Friedson filed a notice of appeal on December 2, 2008. The notices of appeal
filed on December 1 and December 2, 2008 were timely regardless of whether the date of
the final judgment is deemed to be September 9, 2008 (when the ambiguous order
dismissing “the cause of action” for want of prosecution was signed) or November 14,
2008 (when the document denominated as the “Final Judgment” was signed). After the
September 9, 2008 dismissal order was signed, Davis timely filed a motion to reinstate on
October 2, 2008. The filing of this motion to reinstate extended the time for Davis to file a
notice of appeal until December 8, 2008. See Tex. R. App. P. 26.1(a)(3). If November
14, 2008 is deemed to be the operative date, then Davis had until December 15, 2008 to file
6
his notice of appeal. See Tex. R. App. P. 26.1. Davis’s notice of appeal filed on
December 1, 2008 was timely regardless of which deadline applies. Because Davis timely
filed his notice of appeal on December 1, 2008, Friedson’s notice of appeal filed on
December 2, 2008 also was timely. See Tex. R. App. P. 26.1(d).
On appeal, we address only Davis and Friedson individually.3
Analysis
A.
Summary Judgment on Friedson’s Claims for Breach of Contract and
Fraud Against Davis
In his first issue, Friedson contends the trial court erred by granting Davis’s motion
for partial summary judgment on Friedson’s breach of contract claim because Friedson
presented some evidence that (1) he accepted Davis’s changes to the agreement; (2) Davis
breached the agreement by buying the property without Friedson’s assistance; and (3) the
written agreement complied with the Real Estate License Act. Friedson also argues the
trial court erred by granting summary judgment on his fraud claim because the written
agreement complied with the Real Estate License Act.
1.
No-Evidence Motion for Summary Judgment
Davis sought a no-evidence motion for summary judgment with respect to (1) the
existence of a contract; and (2) breach of the asserted contract.
The movant must specifically state the elements as to which there is no evidence.
Walker v. Thomasson Lumber Co., 203 S.W.3d 470, 473-74 (Tex. App.—Houston [14th
3
Wilkinson, KET, and Jones did not file briefs or otherwise pursue their respective appeals.
Therefore, we dismiss their appeals for want of prosecution. Tex. R. App. P. 42.3(b); Physio GP, Inc. v.
Naifeh, No. 14-08-00017-CV, 2010 WL 374515, at *1 n.1 (Tex. App.—Houston [14th Dist.] 2010, no pet.
h.). National Income Property did not file a notice of appeal; is not listed in Friedson’s notice of appeal;
and is not a party to this appeal. See Mortland v. Dripping Springs I.S.D., Nos. 03-02-00331-CV,
03-03-00003-CV, 2003 WL 21705258, at *2 (Tex. App.—Austin 2003, no pet.) (mem. op.) (appellant
could not add other appellants by listing their names in his brief when those appellants did not file or join
notice of appeal).
7
Dist.] 2006, no pet.). The trial court must grant the motion unless the respondent produces
summary judgment evidence raising a genuine issue of material fact. Tex. R. Civ. P.
166a(i). However, the respondent is “not required to marshal its proof; its response need
only point out evidence that raises a fact issue on the challenged elements.” Hamilton v.
Wilson, 249 S.W.3d 425, 426 (Tex. 2008) (quoting Tex. R. Civ. P. 166a(i) cmt. 1997).
A no-evidence summary judgment is essentially a pretrial directed verdict, and we
apply the same legal sufficiency standard in reviewing a no-evidence summary judgment
as we apply in reviewing a directed verdict. Mathis v. Restoration Builders, Inc., 231
S.W.3d 47, 50 (Tex. App.—Houston [14th Dist.] 2007, no pet.)(maj. op.). We review the
entire record in the light most favorable to the non-movant, indulging every reasonable
inference and resolving any doubts against the motion. City of Keller v. Wilson, 168
S.W.3d 802, 824 (Tex. 2005).
We sustain a no-evidence summary judgment when (1) there is a complete absence
of proof of a vital fact; (2) rules of law or evidence bar the court from giving weight to the
only evidence offered to prove a vital fact; (3) the evidence offered to prove a vital fact is
no more than a scintilla; or (4) the evidence conclusively establishes the opposite of a vital
fact. Walker, 203 S.W.3d at 474. Less than a scintilla of evidence exists when the
evidence offered to prove a vital fact is so weak as to do no more than create a mere
surmise or suspicion of its existence, and in legal effect is no evidence. Ford Motor Co. v.
Ridgway, 135 S.W.3d 598, 601 (Tex. 2004). More than a scintilla of evidence exists when
the evidence rises to a level that would enable reasonable and fair-minded people to differ
in their conclusions as to the existence of the vital fact. Id.
a.
Existence of a valid contract
The essential elements of a breach of contract claim are (1) the existence of a valid
contract, (2) the plaintiff performed or tendered performance, (3) the defendant breached
the contract, and (4) the plaintiff was damaged as a result of the breach. Winchek v. Am.
Express Travel Related Servs. Co., 232 S.W.3d 197, 202 (Tex. App.—Houston [1st Dist.]
8
2007, no pet.).
Parties form a binding contract when there is (1) an offer, (2) an
acceptance in strict compliance with the terms of the offer, (3) a meeting of the minds, (4)
consent by each party to the terms, and (5) execution and delivery of the contract with the
intent that it be mutual and binding. Wal-Mart Stores, Inc. v. Lopez, 93 S.W.3d 548,
555-56 (Tex. App.—Houston [14th Dist.] 2002, no pet.).
For an agreement to be
enforceable, there must be a meeting of the minds with respect to its subject matter and
essential terms. Id. at 556. A “meeting of the minds” is a mutual understanding and
assent to the expression of the parties’ agreement. See Weynand v. Weynand, 990 S.W.2d
843, 846 (Tex. App.—Dallas 1999, pet. denied). To determine whether there was an offer
and acceptance, and therefore a “meeting of the minds,” courts use an objective standard;
they consider what the parties did and said, not the parties’ subjective states of mind. See
Komet v. Graves, 40 S.W.3d 596, 601 (Tex. App.—San Antonio 2001, no pet.).
Davis challenged the existence of a valid contract in his motion for summary
judgment, arguing there was no meeting of the minds that Davis would be responsible for
Friedson’s commission because Davis made a handwritten notation that Friedson would
look to the seller for his commission. Davis contended that the handwritten notation
amounted to a counteroffer that Friedson did not accept.
If Friedson accepted the
notation, Davis argued that he was not contractually obligated to pay Friedson’s
commission. The copy of the agreement attached to Friedson’s original petition and
Davis’s motion for summary judgment contains the handwritten notation, Davis’s initials
next to the notation, and both parties’ initials at the bottom of each page. Signatures for
Friedson and Davis appear at the end of the document.
In response, Friedson argued that there was a valid written agreement between the
parties. He contended that even though he did not specifically initial the language added
by Davis, he initialed at the bottom of the page, signed the agreement, and then performed
9
under the contract. Friedson attached his affidavit, a letter of intent to purchase the
Woodlen Place property, and an unsigned copy of the agreement at issue.4
According to Friedson’s affidavit, he signed the agreement faxed by Davis, which
included the handwritten notation stating that the broker would receive payment directly
from the seller. Friedson stated that he called the listing brokers, KET and Houston
Income Properties, to verify the co-broker fee; he told Davis that KET agreed to pay the
commission, and that they would work out the details in the earnest money contract.
Friedson also attached to the response an unsigned letter of intent to KET outlining Davis’s
offer, which he stated he faxed to KET. The letter of intent indicated that the seller was to
pay Friedson’s commission. Friedson stated in his affidavit that after the agreement
between Friedson and Davis was signed, Friedson called to arrange a tour of the property
for Davis and they exchanged emails to arrange a time for doing so. Friedson said he
received a call from Jones, Davis’s girlfriend and business partner, in which she stated she
was upset that Friedson had another potential buyer looking at the property; she insisted
Friedson close the deal for Davis and Jones. Friedson assured her he would do everything
he could. According to Friedson’s affidavit, Friedson did not speak to Davis again before
the showing and Davis did not attend the scheduled tour of the property.
On this record, Friedson has produced summary judgment evidence raising a
genuine issue of material fact as to whether the parties had an agreement. See Insignia
Capital Advisors, Inc. v. Stockbridge Corp., No. 05-99-01126-CV, 2000 WL 267495, at
*2-3 (Tex. App.—Dallas 2000, no pet.) (not designated for publication) (genuine issue of
material fact existed as to whether parties formed contract in broker sharing deal when
Robertson faxed agreement to DuPree, DuPree made handwritten changes and faxed back,
4
While Friedson does not list the unsigned letter of intent to purchase the property or the unsigned
copy of the representation agreement under the heading “Summary Judgment Evidence” in his summary
judgment response, the record reflects that Friedson attached both to his summary judgment response.
Davis does not challenge the authenticity or admissibility of these documents.
10
and there was evidence that Robertson had signed after DuPree’s fax). We hold that a
no-evidence motion for summary judgment could not be predicated on the absence of
evidence of the existence of a valid contract.
b.
Existence of a breach
Davis also contended in his no-evidence motion for summary judgment that there
was no evidence of a breach because Davis did not agree to pay Friedson’s commission,
and Friedson agreed to look solely to the seller for his commission.
Friedson argues that when Davis stopped using his services after signing the
agreement, Davis defaulted on the agreement and is liable for the cost of his commissions
under a default provision in the agreement. Friedson stated in his affidavit that after the
agreement was signed, he called to arrange a tour of the property and exchanged emails
with Davis about the time of the tour. According to the affidavit, Jones called Friedson
and was upset that Friedson had another potential buyer looking at the same property.
Friedson stated that he did not hear from Davis after the call from Jones and did not see
Davis at the property tour. Friedson later learned that Davis bought the property directly
from KET. Friedson did not receive a commission from KET or Davis.
Friedson also attached to his response an unsigned copy of the representation
agreement. Under the heading “Client’s Obligations,” paragraph 6A of the agreement
requires Davis to “work exclusively through Broker when acquiring property in the market
area and negotiate the acquisition of property in the market area only through Broker.”
The default provision states: “If either party fails to comply with this agreement . . . the
non-complying party is in default. If Client is in default, Client will be liable for the
amount of compensation that Broker would have received under this agreement if Client
was not in default.” Friedson is the “Broker” and Davis is the “Client.”
11
Davis’s handwritten alteration on the signed copy attached to Davis’s motion states
that “[n]otwithstanding paragraph 11, broker will receive all commissions directly from
Seller.” Paragraph 11 is titled “Broker’s Fees.” The default provision is paragraph 13.5
Davis’s argument that the handwritten notation means he did not agree to pay
Friedson’s commission under paragraph 11 does not address the agreement’s separate
default provision in paragraph 13, which purports to make Davis liable for the commission
if Davis defaults by failing to use Friedson’s services. Friedson has produced summary
judgment evidence raising a genuine issue of material fact as to whether Davis defaulted on
the agreement by failing to use Friedson’s services.
See Fieldtech Avionics &
Instruments, Inc. v. Component Control.Com, Inc., 262 S.W.3d 813, 828 (Tex. App.—Fort
Worth 2008, no pet.) (party’s affidavit stating opposing party promised software product
would meet needs and it failed to meet needs enough to create fact issue on breach of
agreement); Oliver v. Rogers, 976 S.W.2d 792, 803 (Tex. App.—Houston [1st Dist.] 1998,
pet. denied) (language in restrictive covenant did not support assertion that there was no
breach, and therefore, was not valid ground for granting of summary judgment). We hold
that a no-evidence motion for summary judgment could not be predicated on the absence of
evidence of a breach.
2.
Traditional Motion for Summary Judgment
Under the “traditional motion for summary judgment” heading, Davis argued that
Friedson’s breach of contract and fraud claims failed because (1) the agreement violated
the statute of frauds under the Real Estate License Act; (2) no enforceable agreement was
formed because there was no meeting of the minds on the material term of whether
The copy attached to Davis’s motion is signed by Friedson and Davis and is missing what appears
to be every other line of the default provision, but tracks the language of the provision contained in the
unsigned copy. No party argues that a change was made to the default provision.
5
12
Friedson would look to the seller or buyer for his commission;6 and (3) there is no cause of
action for fraud in failing to pay a commission absent an enforceable agreement.
We review a traditional summary judgment de novo. Provident Life & Accident
Ins. Co. v. Knott, 128 S.W.3d 211, 215 (Tex. 2003). A defendant who conclusively
negates at least one essential element of a cause of action is entitled to summary judgment
on that claim. IHS Cedars Treatment Ctr. Of DeSoto, Tex., Inc. v. Mason, 143 S.W.3d
794, 798 (Tex. 2004). A defendant is entitled to summary judgment on an affirmative
defense if the defendant conclusively proves all the elements of the affirmative defense.
KPMG Peat Marwick v. Harrison County Hous. Fin. Corp., 988 S.W.2d 746, 748 (Tex.
1999); see Tex. R. Civ. P. 94 (statute of frauds is affirmative defense). Once the
defendant produces sufficient evidence to establish the right to summary judgment, the
burden shifts to the plaintiff to come forward with competent controverting evidence
raising a genuine issue of material fact. Harrison County Hous. Fin. Corp., 988 S.W.3d at
748; Centeq Realty, Inc. v. Siegler, 899 S.W.2d 195, 197 (Tex. 1995). We examine the
entire record in the light most favorable to the non-movant, indulging every reasonable
inference and resolving any doubts against the motion in the non-movant’s favor. Wilson,
168 S.W.3d at 824-25.
Davis contended below that the agreement did not comply with subsection (c) of the
Real Estate License Act. That subsection states:
A person may not maintain an action in this state to recover a commission for
the sale or purchase of real estate unless the promise or agreement on which
the action is based, or a memorandum, is in writing and signed by the party
6
While Davis asserted in his motion that no enforceable agreement was formed because there was
no meeting of the minds on a material term, his argument under the traditional summary judgment heading
in his motion speaks only to the Real Estate License Act and the absence of a fraud claim if no contract
exists. On appeal, Davis refers to Friedson’s deposition excerpts as evidence to support his contention that
the parties did not have a meeting of the minds. However, the record does not contain the deposition
excerpts. We cannot consider documents that are not included in the appellate record. U.S. Bank Nat’l
Ass’n v. Stanley, 297 S.W.3d 815, 821 (Tex. App.—Houston [14th Dist.] 2009, no pet.).
13
against whom the action is brought or by a person authorized by that party to
sign the document.
Tex. Occ. Code Ann. § 1101.806(c) (Vernon 2004). Davis contended that the agreement
does not comply with this provision because the party to be charged with paying
commission was the seller, whose signature does not appear on the agreement. In support
of his traditional motion for summary judgment, Davis attached a copy of the “Commercial
Buyer/Tenant Representation Agreement,” signed by Davis, his own supplemental
affidavit, and the affidavit of Thomas B. Wilkinson, IV.7 Friedson asserted in response
that there was a writing signed by Davis, the party against whom the action was brought;
Friedson argues that the statute was satisfied and Davis was liable under the default
provision.
We agree with Friedson that section 1101.806(c) does not preclude enforcement of
the contract. Friedson is seeking his commission under the agreement’s default provision
in paragraph 13, which states: “If Client is in default, Client will be liable for the amount
of compensation that Broker would have received under this agreement if Client was not in
default.”
Davis is the “Client,” and Davis signed the agreement.
Therefore, the
agreement has been signed by the party against whom the action is brought. 8
Davis also refers to Friedson’s deposition excerpts attached to Davis’s first motion for summary
judgment. The record does not contain the first motion for summary judgment or the deposition excerpts.
Davis has included deposition excerpts in the appendix attached to his brief; however the court cannot
consider documents that are not properly included in the appellate record. Stanley, 297 S.W.3d at 821. If
the pertinent summary judgment evidence considered by the trial court is not in the appellate record, we
presume the omitted evidence supports the trial court’s judgment. See Enter. Leasing Co. v. Barrios, 156
S.W.3d 547, 550 (Tex. 2004) (per curiam).
7
8
In Trammel Crow Co. No. 60 v. Harkinson, 944 S.W.2d 631, 633-34 (Tex. 1997), the Texas
Supreme Court held that an exclusive representation agreement providing for the buyers’ real estate broker
to look to the seller for his commission did not satisfy the statute because no terms of the exclusive
representation agreement charged the buyers with any obligation to pay the commission. See id.
(construing version of the Real Estate License Act before Act’s repeal and recodification in the
Occupations Code; current version materially identical to old version). This case is distinguishable
because the exclusive representation agreement here contains a default provision in paragraph 13 charging
Davis, in the event of a default on the agreement, with an obligation to pay the compensation Friedson
would have received under the agreement.
14
On appeal, Friedson and Davis also argue about whether the agreement (1) promises
a definite commission will be paid; and (2) specifies the land to be conveyed with
reasonable certainty. Courts construing section 1101.806(c) have stated that compliance
with this provision requires an agreement that (1) is in writing and signed by the person to
be charged with the commission; (2) promises a definite commission will be paid, or refers
to a written commission schedule; (3) states the name of the broker to whom the
commission is to be paid; and (4) identifies with reasonable certainty the land to be
conveyed, either itself or by reference to some other existing writing. See LA & N
Interests, Inc. v. Fish, 864 S.W.2d 745, 749-50 (Tex. App.—Houston [14th Dist.] 1993, no
writ), disapproved of on other grounds by Trammell Crow Co. No. 60 v. Harkinson, 944
S.W.2d 631, 634 (Tex. 1997). These grounds were not raised in the motion for summary
judgment. Therefore, summary judgment cannot be affirmed on these grounds. See City
of Houston v. Clear Creek Basin Auth., 589 S.W.2d 671, 678 (Tex. 1979).
In any event, the agreement satisfies the Real Estate License Act. The agreement
stated that the broker would receive one percent of the gross sales price if the client
purchased the property. It also listed “Houston, TX” as the market area with a notation
under the heading “Special Provisions” that the agreement was limited to “210 Unit
Apartment Complex Known As Woodlen Place.” This information suffices. See James
v. Baron Indus., Inc., 605 S.W.2d 330, 332 (Tex. App.—Houston [14th Dist.] 1980, writ
ref’d n.r.e.) (description “Willowick Place patio homes and the five (5) townhomes on
Nantucket” with dateline of “City of Houston, Harris County, Texas” sufficient to satisfy
statute).9
9
Davis also asserts for the first time on appeal that the agreement is unenforceable because it does
not contain a definite ending term, citing to a former version of Texas Administrative Code section
535.148. This court already has rejected this argument. See Northborough Corporate Ltd. v. Cushman &
Wakefield of Tex., Inc., 162 S.W.3d 816, 820-21 (Tex. App.—Houston [14th Dist.] 2005, no pet.)
(commission agreement not void for lack of termination date).
15
The trial court erred in granting traditional summary judgment on the ground that
the agreement did not comply with the Real Estate License Act. Consequently, the trial
court also erred in granting traditional summary judgment on Friedson’s fraud claim on the
ground that the agreement did not comply with the Real Estate License Act.
We sustain Friedson’s first issue on appeal.
B.
Motion for Continuance
In his second issue, Friedson contends the trial court erred by denying his motion for
continuance because his new attorney, hired five days before the response to the motion for
summary judgment was due, did not have adequate time to prepare and almost no
discovery had been conducted by the previous attorney.
Because we sustain Friedson’s first issue and reverse the granting of the motion for
summary judgment, we need not address whether the trial court abused its discretion by not
allowing Friedson’s newly hired attorney more time to conduct discovery and respond to
the motion.
See Sipes v. Gen. Motors Corp., 946 S.W.2d 143, 161 (Tex.
App.—Texarkana 1997, writ denied) (declining to address motion for continuance which
requested more time to take testimony of experts because on remand the Sipeses would
have opportunity to do so).
We now turn to Davis’s appeal, in which Davis argues that the trial court erred by
(1) dismissing his counterclaims for want of prosecution, and (2) denying his motion to
reinstate.
C.
Dismissal of Davis’s Counterclaims for Want of Prosecution
In his first issue, Davis contends the trial court erred when it dismissed his
counterclaims for DTPA violations, common law fraud, fraud in a real estate transaction,
16
breach of contract, and attorney’s fees for want of prosecution because Davis did not
receive notice of the dismissal hearing.10
We apply an abuse of discretion standard of review to a trial court’s dismissal for
want of prosecution and denial of a motion to reinstate. MacGregor v. Rich, 941 S.W.2d
74, 75 (Tex. 1997) (per curiam) (dismissal for want of prosecution); Smith v. Babcock &
Wilcox Const. Co., 913 S.W.2d 467, 467 (Tex. 1995) (per curiam) (denial of motion to
reinstate). A trial court abuses its discretion if it acts without reference to any guiding
rules or principles or acts in an arbitrary or unreasonable manner. Downer v. Aquamarine
Operators, Inc., 701 S.W.2d 238, 241-42 (Tex. 1985). In reviewing a trial court’s
dismissal order, we look at the entire history of the case and perform a fact intensive,
case-by-case determination. See Olin Corp. v. Coastal Water Auth., 849 S.W.2d 852,
856-58 (Tex. App.—Houston [1st Dist.] 1993, no writ).
A trial court’s authority to dismiss for want of prosecution stems from two sources:
(1) Rule 165a of the Texas Rules of Civil Procedure; and (2) the court’s inherent power.
See Villarreal v. San Antonio Truck & Equip., 994 S.W.2d 628, 630 (Tex. 1999). A trial
court may dismiss under Rule 165a on “failure of any party seeking affirmative relief to
appear for any hearing or trial of which the party had notice,” or when a case is “not
disposed of within time standards promulgated by the Supreme Court.” Tex. R. Civ. P.
As a threshold matter, we reject Friedson’s contention that Davis waived any complaint about
the final judgment because Davis asked the trial court to enter final judgment. Davis filed a motion to
enter final judgment because the parties disputed whether the trial court’s August 26, 2008 interlocutory
summary judgment order disposing of Davis’s counterclaim for declaratory judgment disposed of all of
Davis’s counterclaims. Contrary to Friedson’s assertion, Davis’s motion to enter final judgment states that
the “final order is submitted without waiver of any objections or rulings previously made by this Court,
including but not limited to this Court’s denial of defendant’s motion to reinstate.” It also states that the
judgment is submitted by Davis solely as to form. Therefore, Davis has not waived the right to complain
on appeal about the dismissal for want of prosecution and denial of the motion to reinstate. See First Nat’l
Bank of Beeville v. Fojtik, 775 S.W.2d 632, 633 (Tex. 1989) (per curiam).
10
17
165a(1)-(2).11 In addition, the common law vests the trial court with the inherent power to
dismiss independently of the rules of procedure when a plaintiff fails to prosecute his or her
case with due diligence. Tex. R. Civ. P. 165a(4); Villarreal, 994 S.W.2d at 630.12
A trial court generally must provide notice and a hearing before dismissing a case
under Rule 165a or its inherent power. See Tex. R. Civ. P. 165a(1); Villarreal, 994
S.W.2d at 630. The notice and hearing requirements ensure that the dismissed claimant
has received due process. Smith v. McKee, 145 S.W.3d 299, 302 (Tex. App.—Fort Worth
2004, no pet.); Tex. Sting Ltd. v. R.B. Foods, Inc., 82 S.W.3d 644, 648 (Tex. App.—San
Antonio 2002, pet. denied); Franklin v. Sherman Indep. Sch. Dist., 53 S.W.3d 398, 401
(Tex. App.—Dallas 2001, pet. denied). The failure to provide adequate notice of the trial
court’s intent to dismiss for want of prosecution requires reversal. Villarreal, 994 S.W.2d
at 630-31. However, a lack of notice can be cured when the trial court holds a hearing on
the appellant’s motion to reinstate. Jimenez v. Transwestern Prop. Co., 999 S.W.2d 125,
129 (Tex. App.—Houston [14th Dist.] 1999, no pet.) (maj. op.).
Here, the June 24, 2008 Notice of Intent to Dismiss was addressed only to
Friedson’s attorney even though the body of the notice refers to “All Counsel and Pro Se
parties.” Davis contends his due process rights were violated because he did not receive
notice of the trial court’s intent to dismiss. Davis learned of the dismissal order in time to
file a motion to reinstate. Davis was afforded his due process rights because he received
actual notice of the dismissal order in time to file a motion to reinstate, and a hearing was
11
The Rules of Judicial Administration provide that civil jury cases must be disposed of within 18
months from the appearance date, and civil nonjury cases within twelve months from the appearance date.
Tex. R. Jud. Admin. 6b(1)-(2), reprinted in Tex. Gov’t Code Ann., tit. 2, subtit. F app. (Vernon Supp.
2009).
12
Davis also cites Harris County Local Rule 3.6 as a source of authority for dismissal. Under
Local Rule 3.6, the following cases are eligible for dismissal for want of prosecution pursuant to Texas Rule
of Civil Procedure 165a: (a) cases on file for more than 120 days in which no answer has been filed or is
required by law; (b) cases which have been on file for more than eighteen months and are not set for trial;
and (c) cases in which a party or his attorney has failed to take any action specified by the court. Houston
(Tex.) Civ. Dist. Ct. Loc. R. 3.6(a)-(c).
18
held on that motion. Id. The hearing was held at a time when the trial court had full
control of the judgment. Id. There is no indication that Davis was denied an opportunity
to be heard at the hearing.
Keough v. Cyrus USA, Inc., 204 S.W.3d 1, 6 (Tex.
App.—Houston [14th Dist.] 2006, pet. denied) (maj. op.). Thus, if the trial court failed to
notify Davis of its intent to dismiss the case, the error was cured.13 Id.
Therefore, Davis’s first issue is overruled.
D.
Davis’s Motion to Reinstate
In his second issue, Davis argues that the trial court erred when it denied his motion
to reinstate after the dismissal. Davis contends he demonstrated in the motion to reinstate
that (1) he did not have notice of the trial court’s intent to dismiss; (2) the June 24, 2008
notice was addressed only to Friedson’s attorney and indicated only Friedson’s claims
would be dismissed; and (3) Davis had diligently pursued his counterclaims and was ready
for trial.
On October 2, 2008, Davis filed a motion to reinstate his counterclaims after
dismissal for want of prosecution, verified by his attorney.14 In the verified motion, Davis
stated that his attorney did not receive notice of the court setting the case on the dismissal
docket. Davis further stated that his attorney discovered the dismissal when Davis let him
know that, around the time of Hurricane Ike, Davis personally received a mailed notice
from the clerk of the court postmarked September 8, 2008, reflecting that a motion for
summary judgment had been granted in the case. On September 19, 2008, while on the
court’s website, Davis’s attorney discovered the case had been dismissed for want of
13
Davis argues that even if he had received notice of the dismissal hearing, the notice was
inadequate because it did not indicate under what authority the court intended to dismiss. Davis did not
raise the issue of inadequate notice in his motion to reinstate. Because this argument was not presented to
the trial court, we do not consider it on appeal. Tex. R. App. P. 33.1; Keough, 204 S.W.3d at 5.
Davis’s motion to reinstate includes a notice of hearing for October 24, 2008. There is no
reporter’s record of the hearing; however, the parties agree that the hearing took place.
14
19
prosecution on September 9, 2008. Davis attached to the motion to reinstate a certified
copy of the notice of intent to dismiss addressed only to Friedson’s counsel.
On a party’s motion, the trial court shall reinstate a case if it finds after a hearing that
the failure of the party or his attorney was not intentional or the result of conscious
indifference but was due to an accident or mistake or that the failure has been otherwise
reasonably explained. Tex. R. Civ. P. 165a(3). A failure to appear is not intentional or
due to conscious indifference within the meaning of the rule merely because it is
deliberate; it also must be without adequate justification. Smith, 913 S.W.2d at 468.
Proof of such justification—accident, mistake or other reasonable explanation—negates
the intent or conscious indifference for which reinstatement can be denied. Id.
Because the certified copy of the notice of intent to dismiss addressed only to
Friedson’s attorney reasonably explained why Davis and his attorney failed to appear at the
dismissal hearing, and because the record in this case contains no evidence that the failure
was intentional or the result of conscious indifference, the trial court abused its discretion
when it denied the motion for reinstatement. See Rava Square Homeowners Ass’n. v.
Swan, No. 14-07-00521-CV, 2008 WL 4390437, at *2-3 (Tex. App.—Houston [14th Dist.]
Sept. 30, 2008, no pet.) (mem. op.) (explanation reasonable and no evidence of intentional
failure or conscious indifference); Jackson v. Thurahan, Inc., No. 14-02-00308-CV, 2003
WL 1566386, at *3 (Tex. App.—Houston [14th Dist.] Mar. 27, 2003, no pet.) (mem. op.)
(same). Davis’s second issue is sustained.15 Davis’s claims for DTPA violations, common
15
Friedson contends Davis cannot request that only his counterclaims be reinstated because Texas Rule of
Civil Procedure 165a speaks to “cases” being reinstated and not “claims.” Friedson does not cite any
authority construing Rule 165a in this manner. Friedson also claims Davis’s remaining counterclaims
depended entirely on a contract for which no money had changed hands, and which Davis had successfully
attacked as unenforceable. Rule 165a does not require that the party seeking to reinstate the case establish
a “meritorious” claim or defense. Tex. R. Civ. P. 165a; Sellers v. Foster, 199 S.W.3d 385, 397 (Tex.
App.—Fort Worth 2006, no pet.); Jackson, 2003 WL 1566386, at *4.
20
law fraud, fraud in a real estate transaction, breach of contract, and attorney’s fees against
Friedson are remanded for further proceedings.
III.
Conclusion
We reverse the trial court’s judgment granting summary judgment on Friedson’s
claims for breach of contract and fraud and remand. The trial court also erred in denying
the motion to reinstate Davis’s counterclaims. We therefore reverse the trial court’s
judgment dismissing Davis’s counterclaims; we remand Davis’s counterclaims for DTPA
violations, common law fraud, fraud in a real estate transaction, breach of contract, and
attorney’s fees against Friedson. The remainder of the judgment was not challenged on
appeal and is affirmed. The appeal is dismissed for want of prosecution as to Wilkinson,
KET, and Jones.
Accordingly, we dismiss the appeal in part; affirm the trial court’s judgment in part;
reverse in part; and remand for further proceedings consistent with this opinion.
/s/
William J. Boyce
Justice
Panel consists of Chief Justice Hedges and Justices Anderson and Boyce.
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