Randy L. YESKE, Appellant v. PIAZZA DEL ARTE, INC., Swiss International, Inc. d/b/a Swiss Builders, Tino Bekardi, David E. Kassab and Paul Garney, Appellees
NO. 14-15-00633-CV
Court of Appeals of Texas, Houston (14th Dist.).
Opinion filed December 22, 2016
CONCLUSION
The trial did not err in failing to instruct the jury under
OPINION
Ken Wise, Justice
To stop a non-judicial foreclosure on his condominium unit, appellant Randy L. Yeske filed a lawsuit against three individuals who served on the board of directors of the condominium‘s homeowners association and two corporations. Yeske alleged, among other things, that the homeowners association was never properly incorporated and therefore lacked authority to collect assessments or foreclose on his unit. Yeske sought declaratory relief and also asserted numerous claims for damages against the defendants. In a series of interlocutory orders, the trial court ruled in favor of the defendants on all of Yeske‘s claims. The trial court then severed the homeowners association‘s counterclaims, making the interlocutory orders disposing of Yeske‘s claims final. On appeal, Yeske raises seven issues challenging the trial court‘s rulings and the severance of the association‘s counterclaims. We affirm in part and reverse and remand in part.
FACTUAL AND PROCEDURAL BACKGROUND
In 2001, Tino Bekardi incorporated a for-profit company called Piazza Del Arte, Inc. to develop the Piazza Del Arte Condominiums, a twelve-unit condominium project located at 5801 Winsome Lane in Houston. Bekardi‘s company, Swiss International, Inc. d/b/a Swiss Builders (“Swiss Builders“), completed construction on the condominiums in 2006. Piazza Del Arte, Inc. forfeited its corporate charter several years later.
John Edward Maher, Kenneth A. Zimmern, Houston, TX, for Appellant.
Lance Christopher Kassab, M. Micah Kessler, Houston, TX, for Appellee.
On February 14, 2006, a non-profit corporation named PDA HOA 5801 Winsome was formed to operate the Piazza Del Arte
Through foreclosure, Randy L. Yeske purchased a unit in the Piazza Del Arte Condominiums in October 2009. After purchasing the unit, Yeske “began noticing some inconsistencies in the assessments taxed against each of the unit owners.” Yeske requested various documents from the Association, including the Association‘s “bylaws, declarations, proof of insurance, operating statements, calculations of assessments charged to the owners, [and] detailed accounting and other pertinent documentation relevant to ownership within and operation of the alleged homeowners association.” The parties dispute whether the requested documents were ever made available to Yeske.
According to Yeske, he discovered that the Association was never properly incorporated and therefore never legally existed. The parties dispute whether Yeske subsequently failed to pay his condominium assessments for 2012 and 2013. After giving Yeske notices that his assessments had not been paid, the Association‘s Board of Directors (the “Board“) voted to proceed with a non-judicial foreclosure on Yeske‘s unit. At that time, Bekardi was the president of the Association, Paul Garney was the vice-president, and David E. Kassab was the treasurer. Bekardi resigned in January 2013, and Garney became president. Walter Ebarb, another unit owner, became vice-president, and Kassab remained as treasurer.
In response to the threat of foreclosure, Yeske filed this lawsuit and placed $3,100.00—representing one year‘s dues—in the registry of the court. In his first amended petition, Yeske sought a declaratory judgment that “Piazza Del Arte Homeowners Association, Inc. has not been organized pursuant to the statutes, codes and laws of the State of Texas, and as such is not a viable homeowners association and lacks authority to act according[ly].” Yeske also asserted numerous claims for damages against the defendants, including defamation, misappropriation of funds, wrongful foreclosure, breach of fiduciary duty, negligence, and gross negligence. Yeske also sued Bekardi for civil assault and battery and intentional infliction of emotional distress.
Kassab moved to dismiss Yeske‘s breach of fiduciary duty claim on the grounds that it had no basis in law. See
Yeske filed a second amended petition on December 20, 2013. Ten days later, on December 30, an assumed name certificate was filed by PDA HOA 5801 Winsome notifying the Texas Secretary of State that
In April 2014, the defendants filed a document titled, “Joint Traditional and No-Evidence Motions for Summary Judgment, Request for Attorney‘s Fees and Motion for Sanctions” and attached evidence in support of the motions. The defendants prefaced their motions with the statement that Yeske had mistakenly sued Piazza Del Arte, Inc., an entity that was “no longer valid,” rather than the correct entity, PDA HOA 5801 Winsome, the “entity that is in good standing and managing the subject Homeowners Association.”
In their joint summary judgment motions, the defendants sought no-evidence summary judgment on Yeske‘s claims for declaratory judgment, negligence and gross negligence, defamation, misappropriation of funds, wrongful foreclosure, and “other wrongdoing,” as well as Yeske‘s claims against Bekardi for civil assault and battery and intentional infliction of emotional distress. The defendants sought traditional summary judgment on Yeske‘s negligence and gross negligence claims on the grounds that the defendants did not owe Yeske any duties as a matter of law and therefore Yeske lacked standing to bring these claims against them. The defendants further asserted that they were entitled to traditional summary judgment on Yeske‘s defamation claims because: (1) Yeske could not identify one slanderous comment made by Kassab; (2) the claims were barred by the statute of limitations; (3) the allegedly defamatory statements were either not defamatory as a matter of law or were true or substantially true; and (4) a qualified privilege existed as to Kassab‘s statements in carrying out his duties on the Board and Yeske had no evidence that Kassab acted with malice. Finally, the defendants sought traditional summary judgment on Yeske‘s declaratory judgment action on the grounds that PDA HOA 5801 Winsome d/b/a Piazza Del Arte Homeowners Association is the entity operating the Association and was organized lawfully and remains “in good status” with the Texas Secretary of State. Only Kassab sought sanctions against Yeske.
Yeske moved for a continuance of the hearing on the defendants’ motions, which the trial court granted. Shortly after that, the motions were set for submission on July 14. On July 7, Yeske filed a response to the motions with supporting evidence. The hearing on the defendants’ motions was later reset for September 19.
On September 12, Yeske filed a supplemental response and additional evidence. Yeske asserts that he also filed a third amended petition that same day, but the file-stamped copy in the record shows that the third amended petition was filed on September 15. In the third amended petition, Yeske added allegations that the defendants’ failure to properly incorporate the Association and take other actions constituted a violation of the
On September 30, the trial court signed an interlocutory order granting only the defendants’ no-evidence motion for summary judgment on Yeske‘s defamation claims. The trial court also recessed the hearing on the summary judgment motions and ordered the parties to participate in a mediation regarding the remaining claims “before the Court rules on the remaining claims and rest of Defendants[‘] Motions heard on September 19, 2014.”
On October 24, counterclaims were filed against Yeske by “PDA HOA 5801 Winsome d/b/a Piazza Del Arte Homeowners Association (improperly named in this law
Yeske filed objections and a response to the counterclaims, as well as an answer. Among other things, Yeske asserted that PDA HOA 5801 Winsome was a third-party intervenor, and not a counter-plaintiff as represented.2
In November, the defendants’ remaining summary judgment claims were set for submission on December 1, 2014, along with the defendants’ motion to strike Yeske‘s third amended petition.
On December 1, 2014, the trial court signed an “Order Granting Final Summary Judgment” in which the court granted the defendants’ traditional and no-evidence motions for summary judgment “in their entirety.” In the order, the trial court did not identify the specific grounds on which each claim was disposed, but ruled that Yeske take nothing against the defendants “by reason of his various causes of action” asserted against them. The court also ordered Yeske to pay the defendants $7,500.00 in reasonable and necessary attorney‘s fees and expenses incurred in defending against Yeske‘s declaratory judgment claim, to be paid within thirty days from the date of the order. Additionally, the court ordered that the $3,100.00 Yeske had placed in the registry of the court was to be remitted to “PDA HOA 5801 Winsome d/b/a Piazza Del Arte Homeowners Association, the entity operating the homeowners association.” The trial court denied Kassab‘s motion for sanctions against Yeske, and did not rule on the defendants’ motion to strike Yeske‘s supplemental response and third amended petition.
The Association, now simply identifying itself as “Piazza Del Arte Homeowners Association,” moved for traditional summary judgment on its breach of contract claim against Yeske. The Association sought $6,355.00 allegedly owed by Yeske for unpaid association dues, penalties, and expenses, and attorney‘s fees.
In late December 2014, Kassab, Garney, Bekardi, and Swiss Builders nonsuited their claims against Yeske. At this point, all of Yeske‘s claims had been disposed and the only remaining claims were those of the Association against Yeske.
On February 18, 2015, the Association filed a motion to sever its claims against Yeske, which the trial court granted on April 17, 2015. The severance made the trial court‘s December 1, 2014 order on the defendants’ summary judgment motions final and appealable. Yeske filed a motion for new trial on May 15, 2015, which was overruled by operation of law. This appeal followed.
ISSUES AND ANALYSIS
On appeal, Yeske raises seven issues, contending that the trial court erred by: (1) granting Kassab‘s
I. Kassab‘s Rule 91a Motion to Dismiss
In his first issue, Yeske contends that the trial court erred in granting Kassab‘s
The elements of a common-law breach of fiduciary duty claim are: (1) a fiduciary relationship existed between the plaintiff and defendant; (2) a breach by the defendant of his fiduciary duty to the plaintiff; and (3) an injury to the plaintiff or benefit to the defendant as a result of the defendant‘s breach. See Lundy v. Masson, 260 S.W.3d 482, 501 (Tex. App.—Houston [14th Dist.] 2008, pet. denied). Under the Act, “each officer or member of the board of the condominium association “is liable as a fiduciary of the unit owners for the officer‘s or member‘s acts or omissions.” See
The gravamen of Yeske‘s first amended petition was that Kassab and the other individual defendants were members of an invalid homeowners association that was never properly incorporated as required under the
In Kassab‘s
In support of his motion, Kassab primarily relied on Myer v. Cuevas, in which the court applied general principles of corporation law to conclude that individual board members of a condominium association owed fiduciary duties only to the association, and thus did not owe a formal fiduciary duty to an individual member of the association unless a contract or other special relationship existed between them. See id., 119 S.W.3d 830, 836 (Tex. App.—San Antonio 2003, no pet.). Because the unit owner failed to allege that an informal or confidential relationship existed between himself and the board members, the court held that the unit owner lacked standing to sue the board members individually for breach of fiduciary duty. See id. (citing Wingate v. Hajdik, 795 S.W.2d 717, 719 (Tex. 1990) (explaining that a corporate stockholder “cannot recover damages personally for a wrong done solely to the corporation, even though he may be injured by that wrong” unless the wrongdoer violates a duty arising from a contract or otherwise.“)). Kassab did not argue, and Myer did not address,
On appeal, Yeske does not claim that a common-law formal or informal fiduciary relationship exists between him and Kassab; instead, he argues that Kassab owes him fiduciary duties under
Courts have held that a party is not required to specifically plead a violation of a statute so long as the factual allegations are sufficient to give the opposing party fair notice of the basis of the claim. See, e.g., Discovery Operating, Inc. v. BP Am. Prod. Co., 311 S.W.3d 140, 162 (Tex. App.—Eastland 2010, pet. denied); Broom v. Brookshire Bros., Inc., 923 S.W.2d 57, 60 (Tex. App.—Tyler 1995, writ denied); Ransopher v. Deer Trails, Ltd., 647 S.W.2d 106, 110 (Tex. App.—Houston [1st Dist.] 1983, no writ). Here, Yeske alleged in his first amended petition that; (1) Kassab, a
Nevertheless, the appellees also argue that
In contrast, Yeske‘s allegations against Kassab, if taken as true, would entitle Yeske to relief under the Act. See
II. No-Evidence Summary Judgment on Yeske‘s Defamation Claim
In his second issue, Yeske contends that the trial court erred in granting a no-evidence summary judgment as to his defamation claim against Kassab when there was more than a scintilla of evidence to support it. Within this issue, Yeske also argues that an adequate time for discovery had not passed and the appellants failed to accurately list the challenged elements of their defamation claims.
A. The Summary Judgment Standards of Review
We review the trial court‘s grant of summary judgment de novo. Joe v. Two Thirty Nine Joint Venture, 145 S.W.3d 150, 156 (Tex. 2004). In reviewing either a no-evidence or traditional summary judgment motion, we must take as true all evidence favorable to the non-movant and draw every reasonable inference and resolve all doubts in favor of the non-movant. Id. at 157; Mendoza v. Fiesta Mart, Inc., 276 S.W.3d 653, 655 (Tex. App.—Houston [14th Dist.] 2008, pet. denied).
A no-evidence motion for summary judgment is essentially a motion for a pretrial
The party moving for a traditional summary judgment has the burden to show that no material fact issue exists and that it is entitled to summary judgment as a matter of law.
B. The Applicable Law on Defamation
To maintain a defamation claim, a plaintiff must prove that each defendant; (1) published a statement; (2) that was defamatory; and (3) while acting with negligence regarding the truth of the statement. WFAA-TV v. McLemore, 978 S.W.2d 568, 571 (Tex. 1998). A written statement is defamatory when a person of ordinary intelligence would interpret it in a way that tends to injure the subject‘s reputation and thereby expose the subject to public hatred, contempt, or ridicule, or financial injury, or to impeach the subject‘s honesty, integrity, virtue, or reputation. See Neely v. Wilson, 418 S.W.3d 52, 60 (Tex. 2013). The common law and statutes provide certain defenses and privileges to defamation claims. Id. at 62. For example, it is a complete defense to defamation if a statement is true or substantially true. Id.; Randall‘s Food Mkts. v. Johnson, 891 S.W.2d 640, 646 (Tex. 1995). In a suit brought by a private individual, truth is an affirmative defense. Randall‘s Food Mkts., 891 S.W.2d at 646.
The common law also recognizes a qualified privilege that protects communications made in good faith on a subject in which the author has an interest or a duty to another person having a corresponding interest or duty. See Free v. Am. Home Assurance Co., 902 S.W.2d 51, 55 (Tex. App.—Houston [1st Dist.] 1995, no writ); Pioneer Concrete of Tex., Inc. v. Allen, 858 S.W.2d 47, 49 (Tex. App.—Houston [14th Dist.] 1993, writ denied). If a conditionally privileged statement is motivated by malice, however, the privilege is lost. Pioneer, 858 S.W.2d at 49. Whether a qualified privilege exists is a question of law for the court. Houston v. Grocers Supply Co., 625 S.W.2d 798, 800 (Tex. App.—Houston [1st Dist.] 1981, no writ).
C. Application of the Law to Yeske‘s Defamation Claim
On appeal, Yeske complains that Kassab made defamatory statements to the other condominium owners concerning Yeske‘s alleged failure to pay his 2013 condominium dues and filed a non-judicial foreclosure action based on untrue publications in Harris County. Yeske argues that the trial court erred in granting the no-evidence summary judgment on his defamation claims against Kassab because an adequate time for discovery had not passed, the appellees failed to identify the specific elements of the claim they challenged, and Yeske presented more than a scintilla of evidence that Kassab defamed him. We need not address these complaints, however, because summary judgment on Yeske‘s defamation claim against Kassab may be affirmed on another ground.
The trial court‘s final summary judgment order granted both the appellees’ no-evidence and traditional motions for summary judgment “in their entirety” without specifying the grounds. In their traditional summary judgment motion, the appellees asserted that Yeske could not identify one slanderous comment made by Kassab; the defamation claims against Kassab were barred by limitations; the subject statements were either not defamatory as a matter of law or are true or substantially true; and a qualified privilege exists as to any statements made by Kassab in carrying out his duties on the Board of the Association and Yeske could not show that Kassab acted with actual malice. Although Yeske points to some evidence that Kassab made certain statements which Yeske maintains are defamatory and untrue in response to the appellees’ no-evidence summary judgment motion, Yeske wholly fails to address each of the traditional summary judgment grounds raised in the motion, including Kassab‘s defenses.
When, as here, a summary judgment fails to specify the grounds upon which the trial court relied for its ruling, we must affirm the judgment if any of the grounds advanced is meritorious. Carr v. Brasher, 776 S.W.2d 567, 569 (Tex. 1989). Further, because Yeske does not challenge on appeal the grounds raised in the appellees’ traditional summary judgment motion to defeat Yeske‘s defamation claims, we may affirm the summary judgment on Yeske‘s defamation claim against Kassab on this basis. See Wilkinson v. USAA Fed. Sav. Bank Trust Servs., No. 14–13-00111–CV, 2014 WL 3002400, at *5 (Tex. App.—Houston [14th Dist.] July 1, 2014, pet. denied) (mem. op.) (“[W]hen a particular summary judgment ground goes unchallenged, we affirm the judgment as to that ground.“) (citing PAS, Inc. v. Engel, 350 S.W.3d 602, 608 (Tex. App.—Houston [14th Dist.] 2011, no pet.); Wortham v. Dow Chem. Co., 179 S.W.3d 189, 202-03 (Tex. App.—Houston [14th Dist.] 2005, no pet.) (holding that when trial court issued amended order granting summary judgment in favor of defendant on all of appellants’ claims without specifying any grounds and, on appeal, appellants failed to challenge a ground, summary judgment
III. The Trial Court‘s Grant of Traditional and No-Evidence Summary Judgment on “Various Causes of Action”
In his third issue, Yeske challenges the trial court‘s grant of traditional and no-evidence summary judgment on his “various causes of action,” including accounting, defamation, assault, misappropriation of funds, negligence and gross negligence, on the grounds that fact issues exist as to these claims. Within this issue, Yeske presents two overarching complaints; (1) the trial court erred in granting summary judgment on Yeske‘s request for a declaratory judgment; and (2) the appellees owed Yeske statutory duties that they breached and therefore summary judgment was improper because he was entitled to bring such an action and sue for attorney‘s fees.
A. Declaratory Judgment Actions
Under the
1. Yeske did not present a genuine issue of material fact on whether the Association ever existed.
As explained above, Yeske sought a declaratory judgment that the Association was “not organized pursuant to the statutes, codes and laws of the State of Texas, and as such is not a viable homeowners association and lacks authority to act according[ly].” In response, the appellees moved for traditional summary judgment on Yeske‘s declaratory judgment action, arguing that the evidence established as a matter of law that PDA HOA 5801 Winsome d/b/a/ Piazza Del Arte Homeowners Association was the entity operating the Association and was organized lawfully and remains in “good status” with the Texas Secretary of State. The appellees also moved for no-evidence summary judgment on Yeske‘s request for declaratory relief, asserting that Yeske had no evidence that (1) the Association was not organized pursuant to the codes, statutes, and laws of the State of Texas, or (2) that the Association is not a viable homeowners association and lacks authority to act accordingly.
The
Yeske contends that the appellees failed to comply with the Act because there was not a corporation named “Piazza Del Arte Homeowners Association, Inc.” when the Association was purportedly created, and therefore the Association never legally existed. Because the Association failed to properly follow the legal requirements for forming a condominium homeowners association, Yeske argues, the Association “pretended that a homeowners association existed and collected monies from owners without legal authority.” Consequently, Yeske argues, he was entitled to bring a declaratory judgment action against the appellees to enforce the Act. See
In their traditional summary judgment motion, the appellees presented evidence that the Association is operated by the nonprofit corporation “PDA HOA 5801 Winsome,” which has been registered with the Secretary of State since 2006, and the corporation remains in good standing with the Texas Secretary of State. Yeske points to no contrary evidence. The appellees contend that Yeske confuses PDA HOA 5801 Winsome, the nonprofit entity that has always operated the Association, with Piazza Del Arte, Inc., the now-defunct for-profit entity that was initially set up to construct the condominiums. According to the appellees, this confusion caused Yeske to sue Piazza Del Arte, Inc., believing it was the Association. Further, after Bekardi resigned as the Association‘s president, Kassab, Garney, and Ebarb filed the assumed name certificate in 2013 to prevent any potential confusion.
The appellees’ evidence conclusively demonstrates that the Association has been legally incorporated as PDA HOA 5801 Winsome since 2006 and is the nonprofit entity that operates the Association in accordance with the Act. The burden thus shifted to Yeske to raise a genuine issue of material fact issue precluding summary judgment.
Yeske first asserts that no entity named “Piazza Del Arte Homeowners Association, Inc.” was ever incorporated and empowered to collect dues or fees from Yeske, and the appellees’ filing of the 2013 assumed name certificate with that name does not cure the defect. Yeske relies on
In Plano Parkway, a condominium unit owner and lessee sought a declaration that the condominium association failed to comply with
Assuming that the Association failed to comply with the Act in some way by representing itself by the name “Piazza Del Arte Homeowners Association, Inc.” or some other variation which differed from its corporate name, Plano Parkway suggests that such a technical violation would not relieve Yeske of his obligation to pay the condominium assessments. See id. at 195-96. In Plano Parkway, the unit owner and lessee also argued that that they were excused from the condominium regime because the association‘s articles of incorporation provided that it “will have no members,” in violation of
Yeske acknowledges the appellees’ claim that PDA HOA 5801 Winsome is the homeowners association for the Piazza Del Arte Condominiums. But, Yeske argues, only after Yeske filed his lawsuit in 2013—and just three months before filing summary judgment motions—did the appellees file an assumed name certificate “attempting to legalize the use of the name ‘Piazza Del Arte Homeowners Association’ as an assumed name of PDA HOA 5801 Winsome, Inc.” Yeske also argues that filing an assumed name certificate cannot “shoehorn” the Piazza Del Arte Homeowners Association into an existing corporation, but even if it did, such an entity would not have been created until 2013. Years before this, Yeske asserts, the appellees attempted to collect dues as if the homeowners association was already incorporated when it was not, pointing to collection letters sent to Yeske demanding $2,700.00 and $3,100.00 for dues that included the letter
While we agree with Yeske that filing an assumed name certificate is not equivalent to forming a new corporation, Yeske cites no authority for the proposition that the failure to file an assumed name certificate invalidates an existing corporate entity. Rather, Yeske cites to
Yeske also contends that PDA HOA 5801 Winsome is not legally incorporated because it does not comply with
The declaration of a condominium must contain
(1) the name of the condominium, which must include the word “condominium” or be followed by the words “a condominium” or a phrase that includes the word “condominium,” and the name of the association.
See
Finally, although his argument is not entirely clear, Yeske appears to contend that his request for declaratory relief could not be disposed of on summary judgment in the appellees’ favor. Yeske argues that because a declaratory judgment action “is an additional and cumulative remedy” that does not supplant any existing remedy, “treating Yeske‘s declaratory judgment as if it were an independent cause of action is error.” Yeske maintains that he was authorized to bring a declaratory judgment action to enforce the Act and, if the prevailing party, he may recover attorneys’ fees for doing so, a proposition with which we agree. As we have explained, however, Yeske is not entitled to the declaratory relief he seeks.
In summary, the thrust of Yeske‘s complaint is that “Piazza Del Arte Homeowners Association, Inc.” purported to be a valid condominium homeowners association that was collecting and using unit owners’ assessments, when no corporation by that name ever legally existed. However, the appellees have presented uncontroverted evidence that the Association has
2. Yeske failed to raise a fact issue precluding summary judgment on “various causes of action.”
Yeske next argues that fact issues preclude summary judgment against him on his “various causes of action” because he presented evidence that creates a genuine issue of material fact precluding summary judgment on all of the claims on which the appellees moved for summary judgment.
In his summary judgment response, Yeske did not address each of the appellees’ grounds for summary judgment; instead, Yeske organized his arguments into three sections; (1) “Under Texas law, Condominium Association never existed“; (2) “Assumed Name Certificate fails as a matter of law“; and (3) “Defendants liable to unit owners by statute.” In the third section, Yeske asserted that all of the appellees were subject to liability for violations of specific provisions of the Act and, further, that the individual board members were liable for breaches of fiduciary duty under
On appeal, Yeske reproduces the same section of his response to assert that his evidence “unequivocally created the necessary fact issues” to preclude summary judgment on his various causes of action. In this section of his brief, Yeske does not address the evidence that he contends raises a genuine issue of material fact on each challenged element of the appellees’ no-evidence summary judgment on Yeske‘s claims for negligence, gross negligence, defamation, misappropriation of funds, wrongful foreclosure, other wrongdoing, assault and battery, or intentional infliction of emotional distress. Indeed, Yeske does not discuss these claims at all.
Because Yeske failed to point out the evidence that raises a fact issue on each of the elements of the claims challenged in the appellees’ no-evidence summary judgment motion and does not address the claims on appeal, we overrule Yeske‘s third issue and affirm the trial court‘s grant of the appellees’ no-evidence summary judgment motion on Yeske‘s claims of negligence, gross negligence, defamation, misappropriation of funds, wrongful foreclosure, other wrongdoing, assault and battery, and intentional infliction of emotional distress. See Haven Chapel United Methodist Church v. Leebron, 496 S.W.3d 893, 903 (Tex. App.—Houston [14th Dist.] 2016, no pet.) (affirming grant of no-evidence summary judgment when appellant did not address the claims on which appellee moved for no-evidence summary judgment or direct the court to any evidence to overcome the appellee‘s challenges to the elements of each of the appellant‘s claims); Leffler v. JP Morgan Chase Bank, N.A., 290 S.W.3d 384, 386-87 (Tex. App.—El Paso 2009, no pet.) (“When a ground upon which summary judgment may have been rendered, whether properly or improperly, is not challenged, the judgment must be affirmed.“).
IV. Summary Judgment Granted on Claims Not Presented in the Appellees’ Motion
In his fifth issue, Yeske contends that the trial court erred in granting a traditional and no-evidence summary judgment on claims not presented in the appellees’ motion. Yeske argues that the appellees wholly failed to move for summary judgment on the following claims alleged in his third amended petition; (1) defamation by Bekardi and Garney; (2) demand for accounting; (3) violation of TUCA; (4) attorney‘s fees for bringing TUCA claims; and (5) declaratory judgment on Yeske‘s TUCA claims. In response, the appellees contend that the third amended petition alleging TUCA claims was not before the trial court, but even if it were, they were entitled to summary judgment on all claims.
A. The Timeliness of the Third Amended Petition
Yeske contends that he timely filed his third amended petition with his supplemental response to the appellees’ motions on September 12, seven days before the September 19, 2014 hearing date. In support of this contention, Yeske points to the petition‘s certificate of service indicating that it was served on September 12, and he notes that the petition was filed before the January 2, 2015 deadline for amended pleadings contained in the court‘s docket control order. Yeske also argues that the trial court must have considered his third amended petition before signing the September 24, 2014 order granting a no-evidence summary judgment on Yeske‘s defamation claim against Kassab because the appellees moved to strike the petition as untimely, but the trial court did not rule on their motion.
A party may amend its pleadings after a motion for summary judgment is filed until seven days before trial.
The appellees assert that Yeske‘s third amended petition was not timely filed because even though the certificate of service indicates that the petition was served on September 12, the electronic file stamp from the clerk‘s office shows that it was actually filed on September 15, less than seven days before the
1. The trial court‘s order
The appellees contend that the language in the final summary judgment order shows that the trial court did not consider Yeske‘s petition because it reflects that the trial court considered only the “pleadings ... properly before the Court ....” See John C. Flood of DC, Inc. v. SuperMedia, L.L.C., 408 S.W.3d 645, 654 (Tex. App.—Dallas 2013, pet. denied) (“By reciting that it considered the “timely filed” pleadings, not “all of the pleadings,” the trial court indicated it did not consider appellants’ amended answer in the course of deciding appellee‘s summary judgment motions.“); Hussong v. Schwan‘s Sales Enters., Inc., 896 S.W.2d 320, 323 (Tex. App.—Houston [1st Dist.] 1995, no writ) (trial court did not grant leave to file pleadings late where summary judgment order stated that court considered “prior pleadings referenced in the motion for summary judgment“).
The trial court‘s order recites; “The Court, having considered the aforesaid motions, as well as the pleadings, affidavit(s), discovery responses, if any, exhibits and other summary judgment evidence properly before the Court” grants the appellees’ summary judgment motions (emphasis added). The phrase “properly before the court” immediately follows “other summary judgment evidence,” rather than the list of items that includes the pleadings. “It is a general rule of grammar that modifying words or phrases are presumed to apply to the words or phrases that immediately precede them and not to those more remote.” See Note Inv. Grp., Inc. v. Assocs. First Capital Corp., 476 S.W.3d 463, 479-80 (Tex. App.—Beaumont 2015, no pet.) (collecting authorities). Applying this rule, the phrase “properly before the court” modifies only “other summary judgment evidence,” not the more remote “pleadings.” Therefore, the order reflects that the trial court considered “the pleadings” on file, and it is undisputed that the third amended petition was on file prior to the hearing.
Even if “properly before the court” were read to modify “pleadings,” the trial court could have determined that the petition was properly filed, given that it did not grant the appellees’ motion to strike the petition. Further, the language in the order that Yeske shall take nothing “by reason of his various causes of action” suggests that the trial court intended to grant summary judgment on all of Yeske‘s claims, including those asserted in his
2. Prejudice and surprise
The appellees next contend that they were “clearly prejudiced and surprised” by the third amended petition because “a pleading is facially prejudicial if it asserts new claims not previously pleaded.” According to the appellees, because they objected to the amendment as prejudicial, “prejudice has been demonstrated.” As support for this contention, the appellees cite G.R.A.V.I.T.Y. Enterprises, Inc. v. Reece Supply Company, 177 S.W.3d 537, 544 (Tex. App.—Dallas 2005, no pet.), and Stephenson v. LeBoeuf, 16 S.W.3d 829, 839 (Tex. App.—Houston [14th Dist.] 2000, pet. denied). But neither case holds that a pleading is automatically prejudicial on its face as a matter of law merely because it asserts a new cause of action. See G.R.A.V.I.T.Y., 177 S.W.3d at 543 (holding that trial court had discretion to grant motion to strike appellant‘s second amended petition when appellant did not dispute that it was prejudicial on its face, the petition was untimely under the scheduling order, and it was objected to by appellee); Stephenson, 16 S.W.3d at 839 (“Merely because an amended pleading asserts a new cause of action, however, does not make it prejudicial to the opposing party as a matter of law.“). Further, although Yeske did not allege that the appellees’ conduct constituted statutory violations of TUCA until the third amended petition, his pleadings and summary judgment responses reflect that his claims were based on the appellees’ alleged failure to comply with various TUCA provisions. Therefore, the appellees have not demonstrated surprise as a matter of law.
Because the summary judgment order reflects that all pleadings were considered, the record does not indicate that Yeske‘s third amended petition was not considered, and the appellees have not shown surprise, we presume that the trial court granted Yeske leave to amend his pleadings and considered the third amended petition.
B. Summary Judgment on All of Yeske‘s Claims was Error
Yeske next contends that the appellees did not move for summary judgment on the following claims; (1) defamation by Bekardi and Garney; (2) demand for accounting; and (3) statutory claims, declaratory judgment, and attorney‘s fees under TUCA. Therefore, Yeske asserts, the appellees were not entitled to summary judgment on those claims. In response, the appellees assert that even if the trial court considered Yeske‘s third amended petition alleging TUCA violations, summary judgment as to these claims was proper.
As a general rule, a party may not be granted judgment on a cause of action not addressed in a Rule 166a(c) summary judgment proceeding. See Nall v. Plunkett, 404 S.W.3d 552, 555 (Tex. 2013) (per curiam); Similarly, the no-evidence summary judgment rule “requires that the moving party identify the grounds for the motion.” Timpte, 286 S.W.3d at 310. The portion of a final summary judgment rendered on the plaintiff‘s entire case under these circumstances must generally be reversed because the judgment grants more relief than requested. See Lehmann v. Har-Con Corp., 39 S.W.3d 191, 200 (Tex. 2001); Dubose v. Worker‘s Med., P.A., 117 S.W.3d 916, 922 (Tex. App.—Houston [14th Dist.] 2003, no pet.).
This court has recognized limited exceptions to the general rule when (1) the movant has conclusively proved or disproved a matter that would also preclude
1. Defamation against Bekardi and Garney
Yeske asserts that the appellees moved for no-evidence summary judgment only as to Yeske‘s claims of defamation against Kassab, and therefore are not entitled to summary judgment on his defamation claims against Bekardi and Garney. The appellees’ no-evidence motion challenged the following elements of Yeske‘s defamation claims:
[A]fter an adequate period of discovery, Plaintiff has been unable to produce, and will not be able to produce, evidence sufficient to raise a genuine issue of material fact as to these challenged elements; (1) that any of the Defendants actually published a statement; (2) that any alleged statements which were published were defamatory concerning the Plaintiff; and/or (3) that Defendants acted with negligence regarding the truth of the statement. Moreover, as to Defendant David Eric Kassab, Plaintiff cannot put forth evidence sufficient to raise a genuine issue of material fact that David Eric Kassab published any allegedly defamatory statements with actual malice.
The appellees properly identified each challenged element of Yeske‘s defamation claims against all of the “Defendants“—which would include Bekardi and Garney—and asserted an additional defense specific to Kassab. See Timpte, 286 S.W.3d at 310; Lampasas v. Spring Ctr., Inc., 988 S.W.2d 428, 436 (Tex. App.—Houston [14th Dist.] 1999, no pet.). Because Yeske offered no evidence to support his defamation claims against Bekardi and Garney, the trial court did not err by granting summary judgment on those claims. See Wilkinson, 2014 WL 3002400, at *5; Wortham, 179 S.W.3d at 202-03.
2. Demand for Accounting
Yeske claims that he alleged a demand for an accounting in both his second and third amended petitions, in which he requested that “the Association provide access to all of its financial books and financial records and to provide a full and accurate accounting of all funds deposited and expended allegedly on behalf of the owners of property located at 5801 Winsome Lane, Houston, Texas, from January 2006 to present.” Additionally, in Yeske‘s third amended petition, he alleges that “the Defendants have wholly failed to abide by the provisions of TUCA, including but not limited to obtaining annual audits, keeping true books, and fail[ing] to make financial records, other records or annual audits available” to Yeske, causing him to incur attorney‘s fees and expenses for which he is entitled to recover under
An accounting may be a particular remedy sought in conjunction with another cause of action or it may be a suit in equity. Lewis v. Xium Corp., No. 07-08-0219-CV, 2009 WL 1953419, at *5 (Tex. App.—Amarillo July 8, 2009, pet. denied) (mem. op.). In a suit for an accounting, the general rule requires that the right to an accounting must first be determined and, if found, reference for an account should be ordered. Advert. & Policy Comm. of the Avis Rent A Car Sys. v. Avis Rent A Car Sys., 780 S.W.2d 391, 400 (Tex. App.—Houston [14th Dist.] 1989), vacated and remanded due to settlement, 796 S.W.2d 707 (Tex. 1990). To be entitled to an accounting, a plaintiff usually must have a contractual or fiduciary relationship with the party from which the plaintiff seeks the accounting. T.F.W. Mgmt., Inc. v. Westwood Shores Prop. Owners Ass‘n, 79 S.W.3d 712, 717 (Tex. App.—Houston [14th Dist.] 2002, pet. denied).
The appellees contend that Yeske‘s request for an accounting is “not a separate cause of action but rather a remedy sought.” See Shields v. Ameriquest Mortg. Co., No. 05-06-01647-CV, 2007 WL 3317533, at *2 (Tex. App.—Dallas Nov. 9, 2007, no pet.) (mem. op.). Because the claims underlying Yeske‘s request for an accounting were appropriately dismissed, the appellees assert, Yeske is not entitled to this relief. The appellees’ argument overlooks Yeske‘s separate allegations under the section of his third amended petition on “Violations of
3. Other TUCA Claims
In addition to the accounting-related TUCA claims in Yeske‘s third amended petition, Yeske alleged that the Association never existed and therefore collected monies from owners without legal authority in violation of TUCA. Moreover, as the appellees acknowledge, Yeske argued in his summary judgment response that; each of the appellees owed him statutory duties under the Act; appellees Kassab, Bekardi, and Garney owed him fiduciary duties under
Concerning Yeske‘s TUCA claim that the Association was never legally incorporated and never existed, we agree with the appellees that this claim was disposed of by the summary judgment on Yeske‘s declaratory judgment action. As discussed above, the appellees moved for summary judgment on Yeske‘s request for declaratory relief and conclusively demonstrated that the Association was properly incorporated and in existence. Because the crux of Yeske‘s TUCA claim and request for declaratory relief was that the Association never legally existed, summary judgment was properly granted on this alleged violation of TUCA. See Dubose, 117 S.W.3d at 922.
Concerning Yeske‘s claims relating to the appellees’ failure to properly keep the Association‘s records and make the records available to Yeske, the appellees contend that they addressed this claim by moving for summary judgment on Yeske‘s negligence claim, which was based, at least in part, on allegations that the appellees failed “to render an accounting or to allow plaintiff access to its financial records” and “to protect the residents’ As
Unlike Wortham, the appellees do not argue that Yeske failed to present evidence on an element common to both his negligence claims and his TUCA claims; instead, the appellees argue that because Yeske‘s negligence claim was based on the same allegations on which the TUCA claim is based, summary judgment on the negligence claim also disposes of the TUCA claim. In PAS, Inc. v. Engel, this court rejected a similar argument that summary judgment on a fraud claim also encompassed an unaddressed breach of fiduciary duty claim merely because summary judgment was proper on the negligence claim and both claims arose from the “same set of facts.” See PAS, 350 S.W.3d at 610. The court instead looked to the elements of each claim and concluded that, because the fiduciary duty claim did not require evidence of the same element on which the negligence claim was disposed, summary judgment on the fraud claim did not preclude the fiduciary duty claim. See id. (stating that a claim for breach of fiduciary duty, unlike a fraud claim, does not require a plaintiff to establish reliance and holding that “the fact that at-will employment precludes PAS from establishing justifiable reliance for purposes of its fraud claim on alleged statements by Engel regarding future employment with PAS, ... does not bar its breach of fiduciary duty claim“).
The appellees’ no-evidence summary judgment motion challenged the elements of a common-law negligence claim, namely, the existence of a duty, breach of that duty, and damages proximately caused by the breach. See W. Invs., Inc. v. Urena, 162 S.W.3d 547, 550 (Tex. 2005). In contrast, TUCA provides that “[if] a declarant or any other person subject to this chapter violates this chapter, the declaration, or the bylaws, any person or class of persons adversely affected by the violation has a claim for appropriate relief.”
Yeske‘s TUCA claims implicate statutory obligations that differ from the duties imposed under the common law. See Plano Parkway, 246 S.W.3d at 195-96. However, with the exception of Yeske‘s claim that the Association never legally existed, nothing in the appellees’ summary judgment motion addresses Yeske‘s allegations that the appellees violated various provisions of the Act. See Engel, 350 S.W.3d at 610; see
Further, to the extent that the appellees argue, as they did in their reply brief in the trial court, that Yeske‘s statutory claims fail—including Yeske‘s fiduciary duty claim under
V. Severance of the Association‘s Claims against Yeske
In his seventh issue, Yeske contends that the trial court erred in severing the Association‘s claims against him when they were inextricably interwoven with his claims against the Association. The Association responds that severance was proper because all of Yeske‘s claims had been disposed by summary judgment and the only claims remaining were those of the Association.
A trial court has broad discretion in the matter of severance and consolidation of causes, and the trial court‘s decision to grant a severance will not be reversed unless it has abused its discretion. Guaranty Fed. Sav. Bank v. Horseshoe Operating Co., 793 S.W.2d 652, 658 (Tex. 1990). The controlling reasons for allowing a severance are avoiding prejudice, doing justice, and increasing convenience. Id. A claim is properly severable if (1) the controversy involves more than one cause of action, (2) the severed claim is one that would be the proper subject of a lawsuit if independently asserted, and (3) the severed claim is not so interwoven with the remaining action that they involve the same facts and issues. In re State, 355 S.W.3d 611, 614 (Tex. 2011). If any one of these three criteria are not met, then the trial court has abused its discretion and reversal is warranted. Owens v. Owens, 228 S.W.3d 721, 726 (Tex. App.—Houston [14th Dist.] 2006, pet. dism‘d).
According to Yeske, the Association‘s claims against him involve the exact same facts and issues presented by his claims, the claims are mirror opposites that are inextricably interwoven, and no judicial economy is preserved by severing the Association‘s claims against him. Although we have concluded that Yeske failed to raise a genuine issue of material fact on his claim that the Association was not properly incorporated and therefore never legally existed, we agree that Yeske‘s statutory claims under the
In his sixth issue, Yeske argues that the trial court erred in granting the appellees attorney‘s fees and expenses on summary judgment. Within this issue, Yeske raises several sub-issues; (1) the appellees are not entitled to fees for defending themselves; (2) David Kassab is not entitled to hybrid representation and recovery of his own fees and must segregate them; and (3) the award of attorney‘s fees payable in 30 days is an improper sanction.
The trial court‘s judgment reflects that the appellees were awarded attorney‘s fees based on the
As discussed above, the trial court did not err in granting summary judgment on Yeske‘s request for declaratory judgment that the Association never legally existed and therefore collected monies from unit owners without legal authority. As we have also explained, however, Yeske‘s third amended petition included claims that the appellees violated various provisions of TUCA, which were not addressed in the appellees’ summary judgment motion. Because we reverse and remand the case for further proceedings, we also reverse the award of attorney‘s fees for reconsideration on remand. See
CONCLUSION
The trial court properly granted summary judgment on Yeske‘s request for declaratory judgment and claims for negligence, gross negligence, defamation, misappropriation of funds, wrongful foreclosure, other wrongdoing, assault and battery, and intentional infliction of emotional distress. However, the trial court erred in granting summary judgment on Yeske‘s claims based on violations of the