Granbury Marina Hotel, LP D/B/A Hilton Garden Inn, Granbury v. Berkel & Company Contractors, Inc.
08-13-00246-CV
Tex. Crim. App.Aug 14, 2015Background
- Berkel (pile-installation contractor) contracted with Hilton to install deep foundations for a hotel; contract price ~$391,680 (increased to $401,480 after extra work). 10% retainage allowed until completion.
- Berkel completed the project in July 2007, submitted a final invoice for $40,148 (retainage), and Hilton refused final payment; Berkel sued for breach of contract and related claims; Hilton counterclaimed but later nonsuited.
- Trial: one-day jury trial; Berkel presented two documents as exhibits (Application and Certification for Payment; Final Retainage Application and Final Lien Releases) through Berkel VP Brettmann, who testified he was records custodian but did not establish that the forms were made as a regular practice by a person with knowledge.
- Hilton objected to the exhibits on business-records foundation and hearsay-within-hearsay grounds; the court initially sustained one objection, Berkel added foundation testimony, and the court admitted both exhibits.
- Jury found for Berkel: award of damages and attorney’s fees; after remittitur and judgment, Hilton appealed, raising sufficiency of evidence, erroneous admission of business records, and denial of new trial.
- The Court of Appeals reversed and remanded, concluding the trial court abused its discretion in admitting the exhibits under the business-records exception and that the error probably produced an improper judgment.
Issues
| Issue | Plaintiff's Argument (Berkel) | Defendant's Argument (Hilton) | Held |
|---|---|---|---|
| Sufficiency re: condition precedent to payment | Berkel argued it had performed conditions precedent (pleaded generally) and was not required to prove certification absent specific denial | Hilton argued contract required construction‑manager certification and Berkel failed to obtain it, so payment was not due | Held for Berkel: Hilton did not specifically deny the condition precedent under Tex. R. Civ. P. 54, so Berkel need not prove it; sufficiency challenge overruled |
| Admissibility of Exhibits under business‑records hearsay exception | Exhibits were business records; Brettmann’s custodian testimony sufficed and documents were trustworthy | Brettmann failed to show regular practice or that records were made by a person with knowledge; affidavits in documents raised hearsay‑within‑hearsay | Held for Hilton: admission abused discretion because proponent failed to establish elements of Tex. R. Evid. 803(6); error probably caused improper judgment; reversible |
| Waiver of evidentiary objection | Berkel argued Hilton waived objections by not re‑urging them when documents were reoffered (futility rule) | Hilton argued its initial objections were preserved because court reconsidered and overruled the same objection | Held for Hilton: objection preserved; futility rule did not apply under these circumstances |
| Harm/Need for new trial | Berkel argued Brettmann’s testimony independently supported damages and exhibits were cumulative/refreshing | Hilton argued case turned on the exhibits because Brettmann lacked independent knowledge of amounts | Held for Hilton: without exhibits there was insufficient evidence of damages; judgment probably improper; remand for new trial |
Key Cases Cited
- Natural Gas Pipeline Co. of Am. v. Pool, 124 S.W.3d 188 (Tex. 2003) (appellate sequencing when multiple reversal/ remand issues exist)
- Texas Dep’t of Transp. v. Able, 35 S.W.3d 608 (Tex. 2000) (standard for reversal based on erroneous evidentiary rulings)
- Owens‑Corning Fiberglas Corp. v. Malone, 972 S.W.2d 35 (Tex. 1998) (abuse of discretion standard for evidentiary rulings)
- Volkswagen of Am., Inc. v. Ramirez, 159 S.W.3d 897 (Tex. 2004) (hearsay definition and admissibility principles)
- Greathouse v. Charter Nat. Bank‑Southwest, 851 S.W.2d 173 (Tex. 1992) (Rule 54 pleading on conditions precedent may be averred generally)
- Hill v. Thompson & Knight, 756 S.W.2d 824 (Tex. App.—Dallas 1988) (need for specific denial to put condition precedent at issue)
- Richardson v. Green, 677 S.W.2d 497 (Tex. 1984) (limits of the futility rule where evidence items differ materially)
- Marling v. Maillard, 826 S.W.2d 735 (Tex. App.—Houston [14th Dist.] 1992) (failure to re‑object can waive challenge when predicate later supplied)
- Leday v. State, 983 S.W.2d 713 (Tex. Crim. App. 1998) (description and limits of the futility rule)