UNITED RESIDENTIAL PROPERTIES, L.P., William Maxwell and Tiffany Tallent, Appellants v. Tom and Dwana THEIS, Appellees.
No. 14-11-00330-CV.
Court of Appeals of Texas, Houston (14th Dist.).
Aug. 21, 2012.
Josef Franz Buenker, Houston, TX, for Appellees.
Panel consists of Justices BOYCE, CHRISTOPHER, and JAMISON.
OPINION
WILLIAM J. BOYCE, Justice.
Tom and Dwana Theis sued United Residential Properties, L.P. (URP), William Maxwell, and Tiffany Tallent (collectively, Appellants) for fraud and deceptive trade practices arising out of the Theises’ purchase of a mold-infested manufactured home from URP.
After a bench trial, the court signed a final judgment in the Theises’ favor. Appellants challenge the trial court‘s judgment in ten issues, arguing among other things that (1) the trial court lacked jurisdiction; (2) there is no evidence of an agency relationship between URP and the individual who made a misrepresentation to the Theises; and (3) the trial court erred by not awarding attorney‘s fees to Appellants.
We hold that the trial court had jurisdiction; there is no evidence of an agency relationship; and Appellants are not entitled to attorney‘s fees. Accordingly, we reverse and render judgment that the Theises take nothing.
BACKGROUND
Nelda Enriquez owned and lived in a manufactured home, but she vacated the home after she and her daughter became sick. Enriquez allowed the home to be foreclosed because “the home was molded and it was uninhabitable.” URP purсhased the home from Enriquez‘s mortgagee, but the home remained on Enriquez‘s property. Enriquez testified that a man named Todd McCarty came to her property and said “he worked for United Realty or United Properties or something to that sort. He gave me a card, and he was bringing some people to show the home.” She told McCarty that the home was infested with mold, but “he said for me to shut up, that he would pay me to stay away from him when he brought people.” She alleged that he offered her $300 to refrain from telling anyone the home had mold.
Tom Theis testified that he became fаmiliar with URP when Dwana responded to an ad in the paper. The Theises met with McCarty, who gave Tom a business card that stated, “United Residential Properties, Todd McCarty.” McCarty took the Theises to look at the manufactured home Enriquez had owned. McCarty gave the price and “kept saying [there] wasn‘t anything wrong with the house.” Tom noticed some “black stuff” inside the home but thought it was just dirt, so he did not ask McCarty about it.
The Theises purchased the house from URP in July 2005. When Tom met with Enriquez to arrange for the home to be moved from her property, Enriquez told him that the house had mold. After discovering mold in the home, the Theises sued URP, Maxwell, and Tallent. The Theises alleged in their live pleading that McCarty was an employee of URP, and that URP, Maxwell, and Tallent were liable for breach of contract, fraud, and false representations and unconscionable conduct under the Deceptive Trade Practices—Consumer Protection Act,
The trial court signed findings of fact and conclusions of law, in which it determined that Appellants were liable for fraud, false and misleading representations under the DTPA, and unconscionable conduct under the DTPA. The trial court signed a final judgment in favor of the Theises finding Appellants jointly and severally liable for economic damages of $45,000, additional damages of $67,500 for intentional and unconscionable conduct, attorney‘s fees of $25,000, and additional
JURISDICTION
In their first and second issues, Appellants argue that the trial court lacked subject matter jurisdiction because (1) the court dismissed the case and then reinstated it after the court‘s plenary power expired; and (2) the Theises failed to exhaust administrative remedies required under the primary and exclusive jurisdiction doctrines.
I. Jurisdiction to Reinstate
On October 30, 2006, the trial court dismissed the Theises’ suit for want of рrosecution. The Theises’ counsel at the time, Charles Heard, mailed to the court a verified motion to reinstate on November 30, 2006; it was received on December 4, 2006.2 The Theises concede that Heard‘s motion was filed more than 30 days after the trial court signed the dismissal order.
Generally, a motion to reinstate must be filed within 30 days of the trial court‘s dismissal. See
Nonetheless, the trial court reinstated the case on December 29, 2006. Appellants did not immediately complain about the reinstatement, and the case proceeded to trial on the merits in February 2011. The trial court signed its final judgment on March 18, 2011. On April 12, 2011, Appellants filed a plea to the jurisdiction and alternative motion for new trial raising the alleged jurisdictional defect concerning the trial court‘s 2006 reinstatement of the case. The Theises responded by filing on May 13, 2011 a “motion to extend pоstjudgment deadlines” under
1. Beginning of periods. The date of judgment or order is signed as shown of record shall determine the beginning of the periods prescribed by these rules for filing in the trial court the various documents that these rules authorize a party to file within such periods including ... motions to reinstate a case dismissed for want of prosecution....
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4. No notice of judgment. If within twenty days after the judgment or other appealable order is signed, a party adversely affected by it or his attorney has neither received the notice required by paragraph (3) of this rule nor acquired actual knowledge of the order, then with respect to that party all the periods mentioned in paragraph (1) shall begin on the date that such party or his attorney received such notice or acquired actual knowledge of the signing, whichever occurred first, but in no event shall such periods begin more than ninety days after the original judgment or other appealable order was signed.
5. Motion, notice and hearing. In order to establish the application of paragraph (4) of this rule, the party adversely affected is required to prove in the trial court, on sworn motion and notice, the date on which the party or his attorney first either received a notice of the judgment or acquired actual knowledge of the signing and that this date was more than twenty days after the judgment was signed.
When a trial court does not make findings on the
In John v. Marshall Health Services, Inc., the Texas Supreme Court held that a
Similarly, the Theises’
Under these rules, Heard‘s motion to reinstate was timely filed even though the Theises’
Appellants’ first issue is overruled.
II. Exhaustion of Administrative Remedies
Appellants contend that the Theises were required to exhaust administrative remedies under the Texas Manufactured Housing Standards Act6 (TMHSA) before bringing suit because the Texas Manufactured Housing Board has primary or exclusive jurisdiction over the Theises’ claims. The Theises contend that the statute does not confer primary or exclusive jurisdiction upon the Board to address their fraud and DTPA claims, and that Appellants failed to comply with the statute by requesting that the Board conduct an inspection.7
We review de novo whether an agency has primary or exclusive jurisdiction. Subaru of Am., Inc. v. David McDavid Nissan, Inc., 84 S.W.3d 212, 222 (Tex. 2002). “An agency has exclusive jurisdiction when a pervasive regulatory scheme indicates that [the Legislature] intended for the regulatory process to be the exclusive means of remedying the problem to which the regulation is addressed.” Id. at 221 (quotation omitted). Under the exclusive jurisdiction doctrine, the Legislature grants an agency the sole authority to make an initial determination in a dispute. Id. “The judicially-created primary jurisdiction doctrine operates to allocate power between courts and agencies when both have authority to make initial determinations in a dispute.” Id. Trial courts should employ the primary jurisdiction doctrine to allow an agency to initially decide an issue when “(1) an agency is typically staffed with experts trained in handling the complex problems in the agency‘s purview; and (2) great benefit is derived from an agency‘s uniformly interpreting its laws, rules, and regulations, whereas courts and juries may reach different results under similar fact situations.” Id.
When a plaintiff has not exhausted administrative remedies, the primary jurisdiction doctrinе generally requires abatement to allow the agency to make an initial determination while the exclusive jurisdiction doctrine requires dismissal for lack of subject matter jurisdiction. See id.
Appellants do not cite any authority holding that the TMHSA confers exclusive or primary jurisdiction to an administrative agency for non-warranty DTPA and fraud claims related to the sale of a manufactured home, and this court has found none. All of the cases Appellants cite in support of exclusive jurisdiction involved clear statutory language granting the administrative agency exclusive jurisdiction. Sеe id. at 223 (exclusive jurisdiction when the statute gave the agency “exclusive, original jurisdiction to regulate“); Am. Motorists Ins. Co. v. Fodge, 63 S.W.3d 801, 803 (Tex.2002) (citing
“Courts of general jurisdiction presumably have subject matter jurisdiction unless a contrary showing is made.... [Agencies] may exercise only those powers the law, in clear and express statutory language, confers uрon them. Courts will not imply additional authority to agencies....” Subaru, 84 S.W.3d at 220 (citations omitted). The TMHSA does not include clear and express statutory language conferring exclusive jurisdiction to an administrative agency for the Theises’ common law fraud claim and non-warranty DTPA claims. The statute concerns only warranty claims.9
Further, Appellants have failed to establish that an administrative agency has primary jurisdiction over the fraud and DTPA claims. Appellants make no argument regarding the Board‘s specialized expertise or the lack of uniformity in judicial resolution of fraud and non-warranty DTPA clаims involving manufactured homes. Cf. Cash Am., 35 S.W.3d at 18 (Texas Pawn Shop Act did not confer primary jurisdiction to Consumer Credit Commissioner over plaintiff‘s claims for conversion and negligence despite administrative remedy available to plaintiff).
The only section that arguably confer jurisdiction to the Texas Department of Housing and Community Affairs addresses warranty claims. Section 1201.602 provides:
(a) Notwithstanding any other law, a suit alleging that a manufacturer, installer, or retailer failed to perform warranty service or failed to comply with a written or implied warranty is abated if:
(1) a plea in abatement is filеd with the court not later than the 45th day after the movant‘s answer date; and
(2) the manufacturer, installer, or retailer requests a consumer complaint home inspection under Section 1201.355.
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(c) A consumer‘s refusal to allow the manufacturer or retailer to perform warranty service in accordance with the inspection report, determinations, and orders of the director bars a cause of action relating to an alleged failure to:
(1) comply with a written or implied warranty; or
(2) perform warranty service.
The Texas Supreme Court interpreted the predecessor statute, which contained substantively similar language. See Holder v. Wood, 714 S.W.2d 318 (Tex.1986). Thе court held that this statute does not require abatement of any claims based on misrepresentations in violation of the DTPA. See id. at 319; see also Thurston v. Green Tree Acceptance of Tex., Inc., 853 S.W.2d 806, 810 (Tex.App.-Tyler 1993, writ denied) (misrepresentation and unconscionability DTPA claims did not relate to breach of warranty claims under prior version of Section 1201.602). The record establishes that the Theises recovered for common law fraud and non-warranty violations of the DTPA. Although the Theises’ initial petition claimed a breach of warranty, their live pleading did not include this language. The court‘s findings of fact and conclusions of law were based on theories of fraud, misrepresentation, and unconscionability—not breach of warranty.10
Regardless, Appellants have failed to establish that they actually complied with Section 1201.602 by filing a plea in abatement within 45 days from their answer date or requesting a consumer complaint inspection under Section 1201.355. Although Appellants argue that they attempted to have the manufactured home inspected, there is nothing in the record indicating they made this request to the Department as required by Section 1201.355. See
Appellants’ second issue is overruled.
SUFFICIENCY OF THE EVIDENCE
In their fifth issue, Appellants argue that there is no evidence to support the trial court‘s findings that MсCarty was an agent, employee, or representative of URP. Thus, Appellants contend that URP, Maxwell, and Tallent could not be vicariously liable for fraud or DTPA claims based on misrepresentations made by McCarty. We agree.
A trial court‘s findings of fact issued after a bench trial are reviewable for legal sufficiency of the evidence by the same standards as applied in reviewing the sufficiency of the evidence supporting a jury‘s finding. Anderson v. City of Seven Points, 806 S.W.2d 791, 794 (Tex.1991). Evidence is legally insufficient if: (a) there is a complete absence of evidence of a vital fact; (b) the court is barred by rules of law or evidence from giving weight to the only evidence offered to prove a vital fact; (c) the evidence offered to prove a vital fact is no more than a mere scintilla; or (d) the evidence establishes conclusively the opposite of the vital fact. Custom Transit, L.P. v. Flatrolled Steel, Inc., 375 S.W.3d 337, 344-45 (Tex.App.-Houston [14th Dist.] 2012, no pet. h.) (citing City of Keller v. Wilson, 168 S.W.3d 802, 810 (Tex.2005)). We must view the evidence in the light most favorable to the trial court‘s findings and assume that the court resolved all conflicts in accordance with its judgment. See City of Keller, 168 S.W.3d at 820. We credit evidence favorable to the trial court‘s findings if reasonable fact finders could, and we disregard contrary evidence unless reasonable fact finders could not. See id. at 827. The ultimate test is whether the evidence at trial would enable reasonable and fair-minded people to reach the finding under review. Id.
The trial court found that McCarty (1) “made false and misleading representa
The Theises alleged in their live pleading that McCarty was URP‘s employee, and the trial court found that McCarty was a “sales representative for URP” and was “acting on behalf of URP.” The Theises contend that these findings are supported by the following evidence:
- “Nelda Enriquez testified that Mr. McCarty had told her that he was acting on behalf of URP.”11
- “Mr. McCarty gave Mr. Theis a URP business card.”12
- “Mr. McCarty represented to Mr. and Mrs. Theis that he represented URP by giving a price and negotiating the sale of the home on behalf of URP.”13
- “Mr. Theis testified that Mr. McCarty is the individual who picked up the purchase money certified check from Mr. Theis on behalf of URP.”14
Viewing this evidence in the light most favorable to the trial court‘s findings, we nonetheless conclude that there is no evidence of agency, either actual or apparent, because there are no statements, аctions, or omissions made by URP directed to McCarty or the Theises indicating that McCarty was URP‘s employee or agent and had authority to make representations about the property on URP‘s behalf.
“Texas law does not presume agency, and the party who alleges it has the burden of proving it.” IRA Res., Inc. v. Griego, 221 S.W.3d 592, 597 (Tex.2007) (citing Buchoz v. Klein, 143 Tex. 284, 184 S.W.2d 271, 271 (1944)). To hold an em
“Actual authority usually denotes the authority a principal (1) intentionally confers upon an agent, (2) intentionally allows the agent to believe he possesses, or (3) by want of due care allows the agent to believe he possesses.” Peek/Howe Real Estate, Inc. v. Brown & Gay Eng‘rs, Inc., No. 14-11-00510-CV, 2012 WL 3043026, at *3 (Tex.App.-Houston [14th Dist.] July 26, 2012, no pet. h.) (mem. op.). “Actual authority is created through written or spoken words or conduct of the principal communicated to the agent.” Walker Ins. Servs. v. Bottle Rock Power Corp., 108 S.W.3d 538, 549-50 (Tex.App.-Houston [14th Dist.] 2003, no pet.).
“Apparent authority is based on estoppel, and only the conduct of the principal in leading a third party to believe that the agent has authority may be considered.” Reliant Energy Servs., Inc. v. Cotton Valley Compression, L.L.C., 336 S.W.3d 764, 784 (Tex.App.-Houston [1st Dist.] 2011, no pet.) (citing Gaines v. Kelly, 235 S.W.3d 179, 182 (Tex.2007); NationsBank, N.A. v. Dilling, 922 S.W.2d 950, 953 (Tex.1996)). “Without the principal‘s participation, either through its acts or knowledge of, and acquiescence in those of the agent, no mere combination of circumstancеs, including acts of the purported agent which may mislead persons into a false inference of authority, however reasonable, will serve as the predicate for apparent authority.” Id. (quotation omitted).
In sum, “‘actual and apparent authority are created through conduct of the principal communicated either to the agent (actual authority) or to a third party (apparent authority).‘” Zarzana, 218 S.W.3d at 159 (quoting Huynh v. Nguyen, 180 S.W.3d 608, 622-23 (Tex.App.-Houston [14th Dist.] 2005, no pet.)). This requirement applies to DTPA violations and intentional torts such as fraud committed by alleged agents or employees. See id. at 159-62.
The Theises fail to identify any statements or conduct by URP, Maxwell, or Tallent that would support a finding that McCarty was an employee of URP acting within the scope of actual or apparent authority. McCarty‘s own representations of purported authority are not representations by URP. See River Mountain at Breckenridge, Inc. v. Mut. of N.Y. Fin. Servs., No. C14-94-00084-CV, 1994 WL 652766, at *2-4 (Tex.App.-Houston [14th Dist.] Nov. 17, 1994, writ denied) (not designated for publication) (no evidence of apparent authority when (1) alleged agent had an office at the alleged principal‘s place of business; (2) agent distributed the principal‘s business cards; (3) agent used the principal‘s stationary; and (4) agent told the plaintiffs that the principal was in the type of business performed by the agent); Edington v. S. Old Line Life Ins. Co., 55 S.W.2d 579, 580 (Tex.Civ.App.-Amarillo 1932, no writ) (no evidence of agency or scope of authority when the alleged agent wrote a letter on letterhead bearing the company‘s name, and the agent furnished a business card with his name, job title, and company‘s name); see also Gen. Am. Life Ins. Co. v. AmSouth Bank, 100 F.3d 893, 898 (11th Cir.1996) (no
Because there is no evidence to support the trial court‘s finding of agency, URP, Maxwell, and Tallent are not liable for misrepresentations by McCarty. The Theises based their claims entirely on misrepresentations and omissions by McCarty; accordingly, we must reverse the trial court‘s judgment.15
Appellants’ fifth issue is sustained.
ATTORNEY‘S FEES
In their sixth issue, Appellants argue that Maxwell is “entitled to recover his attorneys’ fees incurred in defending the allegations of breach of contract
Appellants’ sixth issue is overruled.
CONCLUSION
Having found no evidence of agency, we reverse the trial court‘s judgment and render judgment that the Theises take nothing.16
WILLIAM J. BOYCE
JUSTICE
