Affordable Motor Co., Inc. v. Lna, LLC
351 S.W.3d 515
Tex. App.2011Background
- LNA sued Affordable Motor Company, Inc. (AMC) and Charles A. Ray on a promissory note dated November 6, 2002, and a guaranty; the maker was AMC and Ray personally guaranteed; principal amount $66,500 with interest terms and penalties specified.
- LNA attached a photocopy of the Note and a custodian-of-records affidavit attesting to its authenticity.
- Note allowed acceleration and required notice per default; suit was brought after maturity in 2003; the note included costs of collection and attorneys’ fees.
- Trial court granted summary judgment in favor of LNA for $66,500 plus accrued interest, post-judgment interest, and certain attorneys’ fees; no ruling on evidentiary objections at that time.
- Appellants argued defenses including failure of a condition precedent, statute of limitations, ambiguity, and laches; LNA sought recovery of the note and fees.
- On appeal, the court ultimately reversed the award of attorneys’ fees and affirmed the rest of the final judgment.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Did LNA satisfy the summary-judgment burden on the Note? | LNA proved existence, ownership, maker, and balance due. | AMC/Ray argued genuine issues existed about assent to terms and notice of default. | Yes; LNA satisfied all four elements; summary judgment proper. |
| Was the award of attorneys' fees proper as a matter of law? | LNA contends fees were recoverable and supported by evidence. | Defendants presented controverting affidavits creating material fact issues. | No; fees award reversed; material facts existed regarding reasonableness. |
| Did the trial court err by implicitly overruling objections to summary-judgment evidence? | Not explicitly stated; objections raised in response. | Court implicitly overruled objections by granting summary judgment. | Briefing inadequate; issue resolved against appellants. |
Key Cases Cited
- Levitin v. Michael Group, L.L.C., 277 S.W.3d 121 (Tex.App.-Dallas 2009) (established elements for enforcing a promissory note via summary judgment)
- Wheeler v. Sec. State Bank, N.A., 159 S.W.3d 754 (Tex.App.-Texarkana 2005) (photocopy of note plus affidavit suffices to prove existence)
- Rockwall Commons Assocs., Ltd. v. MRC Mortg. Grantor Trust I, 331 S.W.3d 500 (Tex.App.-El Paso 2010) (absence of verified denials affects evidentiary challenge to instruments)
- CA Partners v. Spears, 274 S.W.3d 51 (Tex.App.-Houston [14th Dist.] 2008) (no acceleration where maturity date passed; accrual of cause of action)
- Sani v. Powell, 153 S.W.3d 736 (Tex.App.-Dallas 2005) (burden on defendant to negate material facts in summary judgment)
- World Help v. Leisure Lifestyles, Inc., 977 S.W.2d 662 (Tex.App.-Fort Worth 1998) (note: referenced regarding notice of default and summary judgment)
- Gen. Specialties, Inc. v. Charter Nat'l Bank—Houston, 687 S.W.2d 772 (Tex.App.-Houston [14th Dist.] 1985) (summary judgment not proper where nonmovant contests reasonableness of fees)