Case Information

*0 FILED IN 1st COURT OF APPEALS HOUSTON, TEXAS 7/29/2015 1:38:52 PM CHRISTOPHER A. PRINE Clerk

*1 ACCEPTED 01-15-00352-CV FIRST COURT OF APPEALS HOUSTON, TEXAS 7/29/2015 1:38:52 PM CHRISTOPHER PRINE CLERK NO. 1-15-00352-CV ______________________________ IN THE FIRST COURT OF APPEALS AT HOUSTON, TEXAS ______________________________ PHAP V. NGUYEN, ANDY NGO, and DUNG T. VU, Appellants VS. MANH HOANG and DUNG LE, Appellees ______________________________ th Appealed from the 55 Judicial District Court of Harris County, Texas ______________________________ APPELLANTS’ BRIEF ______________________________ TOM RORIE State Bar No. 17238000 210 North Street Nacogdoches, TX 75961 (936) 559-1188 FAX (936) 559-0099 ATTORNEY FOR APPELLANTS

ORAL ARGUMENT REQUESTED

IDENTITY OF PARTIES AND COUNSEL

*2

In accordance with Rule 38.1(a) of the T EXAS R ULES OF A PPELLATE P ROCEDURE , Appellants Phap V. Nguyen, Andy Ngo, and Dung T. Vu provide the following list of all parties, and the names and addresses of all counsel: Appellants: Phap V. Nguyen

Andy Ngo Dung T. Vu

Counsel: Tom Rorie Attorney at Law 210 North Street Nacogdoches, TX 75961 (936) 559-1188

FAX (936) 559-0099

Email: trorie@sbcglobal.net

Appellees: Manh Hoang Dung Le Counsel: Scott K. Bui Robert B. Pham Bui, Pham & Nhan, PLLC 3921 Ocee Houston, TX 77063 (713) 783-2466

FAX (713) 783-0787

email: sbui@buinhanlaw.com

ii

TABLE OF CONTENTS

*3 Page Identity of Parties and Counsel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ii Table of Contents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . iii Index of Authorities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . vi Statement of the Case . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ix Statement of Facts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . xi Summary of the Argument . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . xv Points of Error . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

Point of Error No. 1: There is insufficient evidence as a matter of law to establish a partnership between the parties; therefore, there is no liability for breach of a partnership agreement.

Point of Error No. 2: The evidence is legally insufficient to establish that appellants breached a contract with appellees.

Point of Error No. 3: The evidence is insufficient to show any damages for breach of a partnership agreement.

Point of Error No. 4: The evidence is insufficient to show any damages for breach of a contract. Point of Error No. 5: The trial court erred in awarding judgment for damages for both breach of a partnership agreement and breach of contract when both causes of action arose from the same facts or events.

iii *4 Point of Error No. 6: The evidence is insufficient to establish any liability by Appellee Dung Vu because there is insufficient evidence that she engaged in any conduct for which Appellees complain.

Arguments and Authorities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 Standard of Review . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 Point of Error No. 1 Restated . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

Receipt or Right to Receive a Share of Profits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Expression of Intent to Be Partners . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Right to Control the Business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 Sharing or Agreeing to Share in Any Losses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 Contributing or Agreeing to Contribute Money or Property to the Business . . . . . . . . . 14 Summary: The Totality of the Evidence Shows that Appellees were not Partners . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

Point of Error No. 2 Restated . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 Point of Error No. 3 Restated . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 Point of Error No. 4 Restated . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

Payment of 20% of Net Profits to Appellants a Breach of a Partnership Agreement or Contract? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 Is Withholding Money from a Distribution of Profits to pay Federal Taxes a Breach of a Partnership Agreement Or Contract? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 Was It a Breach of a Partnership Agreement or Breach of Contract to Divide Proceeds between Appellant Le and Tuan Ngo Rather than Pay All the Proceeds to Appellee Le? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21

Point of Error No. 5 Restated . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24 iv *5 Point of Error No. 6 Restated . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25 Conclusion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27 Certificate of Compliance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28 Certificate of Service . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28

v

INDEX OF AUTHORITIES

*6 Cases Page Baldwin v. Smith . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 586 S.W.2d 624 (Tex.Civ.App.–Tyler 1979), reversed on other grounds 611 S.W.2d 611 (Tex.1980) Big Easy Cajun Corp. v. Dallas Galleria Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 293 S.W.3d 345 (Tex.App.–Dallas 2009, pet.rev.den’d.) Black Lake Pipe Line Company v. Union Construction Company . . . . . . . . . . . . . . . . . . . . . . . 19 538 S.W.2d 80 (Tex. 1976) Brown v. Keel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 st 2012 Tex.App. LEXIS 1854 (Tex.App.–Houston [1 ] 2012, no writ hist.) Cintrin Holdings, LLC v. Minnis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 th 2013 Tex.App. LEXIS 5723 (Tex.App.–Houston [14 ] 2013, pet.rev.den’d.) Crown Life Ins. v. Casteel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24 22 S.W.3d 378 (Tex. 2000) Gannon v. Baker . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 st 830 S.W.2d 706 (Tex.App.–Houston (1 ] 1992, writ den’d) Greenberg Traurig, LLP v. National American Insurance Company . . . . . . . . . . . . . . . . . . . . . 23 th 448 S.W.3d 115 (Tex.App.–Houston [14 ] 2014) Guerrero v. Salinas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 2006 Tex.App. LEXIS 8562 (Tex.App.–Corpus Christi 2006, no pet.) Hoss v. Alardin . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 338 S.W.3d 635 (Tex.App.–Dallas 2011, no pet.) Ingram v. Deere . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,6,7,8,9 288 S.W.3d 886 (Tex. 2009) Knowles v. Wright . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 st 288 S.W.3d 136 (Tex.App.–Houston [1 ] 2009, pet.rev.dism’d.) Malone v. Patel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 st 397 S.W.3d 658 (Tex.App.–Houston [1 ] 2012, pet.rev.den’d.)

vi *7 Murphy v. Canion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 th 797 S.W.2d 944 (Tex.App.–Houston [14 ] 1990, no writ hist.) Murphy v. Seabarge, Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24,25 th 868 S.W.2d 929 (Tex.App.–Houston [14 ] 1994, aff’d.) Prime Prods, Inc. v. S.S.I. Plastics, Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23 97 S.W.3d 631 (Tex.App.–Houston [1 ] 2002, pet. denied) st Rankin v. Naftalis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23 557 S.W.3d 940 (Tex.1977) Reagan v. Lyberger . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 156 S.W.3d 925, 928 (Tex.App.–Dallas 2005, no pet.) Schuhardt Consulting Profit Sharing Plan v. Double Knobs Mt. Ranch, Inc. . . . . . . . . . . . . . . 23 2014 Tex.App. LEXIS 13417 (Tex.App.–San Antonio 2014, rev’d. in part; aff’d. as modified) Sewing v. Bowman . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,7,10 st 371 S.W.3d 321 (Tex.App.–Houston [1 ] 2012, pet.rev.dism’d.) Southern County Mutual Insurance Company v. First Bank & Trust . . . . . . . . . . . . . . . . . . . . . 24 750 S.W.2d 170 (Tex. 1988) Stewart Title Guaranty Co. v. Sterling . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24 822 S.W.2d 1 (Tex. 1991) Tierra Sol Joint Venture v. City of El Paso . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 155 S.W.3d 503 (Tex.App.–El Paso 2004, pet.den’d.) Truly v. Austin . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 744 S.W.2d 934 (Tex. 1988) Vortt Exploration Company v. Chevron . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 787 S.W.2d 942 (Tex. 1990) Westside Wrecker Service v. Skafi . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,7 361 S.W.3d 153 (Tex.App.–Houston [1 ] 2011, pet.rev.den’d.) st

vii *8 Codes, Rules and Statutes Page T EXAS B USINESS O RGANIZATION C ODE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 Texas Deceptive Trade Practices Act, T EXAS B USINESS AND C OMMERCE C ODE § 17.41, et. seq. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25 T EXAS F AMILY C ODE § 3.201(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26 T EXAS F AMILY C ODE § 3.201(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26 Texas Revised Partnership Act (now repealed) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,6 T EXAS R ULE OF A PPELLATE P ROCEDURE 9.4(i)(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28 T EXAS R ULES OF A PPELLATE P ROCEDURE , Rule 38.1(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ii

viii

STATEMENT OF THE CASE

*9 Appellees brought suit contending that Appellants had breached a partnership agreement with them, had breached a contract with them, and had committed fraud. They sought actual damages for the breaches of the partnership agreement and contract, and exemplary damages as well.

At the close of Appellee’s evidence Appellants moved for an instructed verdict on the following claims : 1. Those against Appellant Dung Vu for the reason that there was no evidence that she had participated in any decision about which Appellees complained, that she made any representation, withheld any information, or assumed any duty to them;

2. Those based on a theory of partnership because there was no evidence of an agreement to share losses or of joint management and control; 3. Those based on a theory of fraud because there was no evidence of any representation by Appellants that was false. The trial judge granted the motion as to the fraud theory, but otherwise denied the motion. (RR Vol. 151-163).

In the Court’s Charge Conference Appellants objected the charge as follows: 1. Again objected to submitting the issues as to Appellant Dung Vu because of a lack

of any evidence that she participated in any decision that Appellees complained of; 2. Objected to the submission of a damages issue for breach of partnership because there is no evidence of the value of the partnership; 3. Objected to the submission of partnership issues without an adequate definition of ix *10 what constitutes “control.” The jury found that a partnership existed and that Appellants had breached a duty of loyalty. It awarded damages to both Appellees for breach of that duty. The jury also found a breach of contract and awarded damages for that breach. The jury did not award exemplary damages.

After return of the jury verdict Appellants filed motions to disregard jury findings and for a judgment notwithstanding the jury verdict. That motion was denied. The court signed a judgment for both Appellees for the damages found by the jury and for pre-judgment interest.

Appellants then filed a motion for new trial, which was denied. This appeal followed. x

STATEMENT OF FACTS

*11 All the parties to this case are members of Vietnamese families who have a strong sense of family and a tradition of helping each other. Appellants were interested in some type of business in which they could prosper through diligent work, and learned through friends that one could make a living by owning and operating a chicken farm, raising chickens for a chicken producer. They worked on chicken farms to learn the business, and then decided to go into business themselves.

Appellants learned of a farm in Georgia which was for sale. They were approved as a grower by the chicken producer which provided the chickens for the farm, Sanderson Farms. ^[1] With a grower contract in hand Appellants were able to secure a loan to purchase the farm they found. But they needed additional funding. So they contacted Appellees and other family members and offered them the opportunity to invest in exchange for the right to receive a proportionate part of any profits made.

Appellee Manh Hoang invested $80,000. Appellee Dung Le, together with her live-in boyfriend Tuan Ngo, invested $50,000. Other family members invested as did Appellants themselves. Appellants secured a loan from a bank in their names only for approximately one and one-half million dollars.

With the needed funds in hand Appellants then closed on the purchase of the Georgia chicken farm and Sanderson placed chickens on the farm. Appellants and Appellant Nguyen’s family all lived in what was referred to as a “garage.” The farm had only six chicken houses which limited its income, and times were hard. Appellant Vu, the wife of Appellant Nguyen, worked in her design *12 business in New Orleans and helped pay the expenses of the farm with her income. Appellants were paying themselves a minimal draw or salary as laborers, as they worked in the houses along with their employees. They knew that they needed to expand the farm and Sanderson authorized them to add two additional houses. None of the investors had any money to contribute for those houses, so Appellants drew no wages for a year and used the wages they would normally have paid themselves to build two additional houses. All the investors benefitted from the additional houses.

After operating the Georgia farm for some time Appellants decided they would like to move to Texas, where most of their family members were located. They decided to sell the Georgia farm, and told the investors of their plans. They sold the farm for a profit, deferred the capital gains taxes on the sale, and then moved to Texas.

While staying in Houston Appellants began searching for some land in central Texas that could be approved by Sanderson Farms for a chicken farm. They spent approximately a year searching for land in several counties and got approval from Sanderson for a tract in Robertson County. Appellants secured a loan, in their names only, for approximately four and one-half million dollars based on their contract with Sanderson, purchased a tract in Robertson County, and built a chicken farm with 16 houses. Appellants secured a contractor for the houses, had a water well drilled, utilities installed, and provided all management of the farm as well as working on the farm. Appellants received no income for approximately a year while they were searching for the land and constructing the chicken farm in Texas.

Appellants learned that Sanderson would provide them chickens for eight additional houses. Appellant Nguyen personally borrowed $400,000 to secure the funds to build those houses. All the investors benefitted from the income earned by those houses, although none of the other investors

xii *13 had any liability for the loan. Appellants successfully operated the farm in Texas. They worked hard. According to Appellee Vu her husband worked from 6:30 a.m. to 9:00 or 10:00 p.m. each day. Appellee Hoang worked as a laborer in the farm, but was “fired” by Appellants because of his poor work habits and one event in which he left the farm unattended when it was his duty to be present. Appellee Le never worked on either of the farms and seldom was present. Appellants decided to sell the farm, in part because they no longer wanted to continue any type of business relationship with Appellees.

Appellants then offered the farm for sale, sold it, and several months later called a meeting with the investors, including Appellees, to distribute the profits made. Appellees insisted on being paid in cash, and in order to protect themselves Appellants recorded the meeting on a video camera. At the meeting Appellant Ngo provided the investors with a worksheet in which he showed the profits made and any deductions from profits. At trial a certified public accountant testified that in his opinion the worksheet was a reasonable and fair accounting of the chicken farm business.

The worksheet that Appellants provided the investors showed that Appellants were withholding from the distribution of profits 20% of those profits as compensation to them for their services and contributions to the venture. They also deducted the amount of capital gains taxes that Appellant Ngo calculated would be due and the taxes on ordinary income they would owe due to depreciation recapture and withheld those amounts from the distribution. While the other investors did not object, Appellees objected to both of these deductions. Appellee Le also objected to the division of the distribution of profits between her and Tuan Ngo. Appellees took the money despite their objections.

After all the business affairs of the farm were completed, Appellants distributed a final xiii *14 additional amount to each investor out of the funds accumulated. The final tally on the investments of Appellees was that Hoang invested $80,000 and realized about $400,000 from his investment while Le invested $50,000 and Appellants paid back over $200,000.

xiv

SUMMARY OF THE ARGUMENT

*15 The judgment by the trial court cannot stand because there is insufficient evidence to support the jury’s finding that a partnership was created between the parties. The totality of the evidence shows no competent evidence to create a partnership, no agreement to share losses or be liable to third parties for debts of the business, and a complete lack of control, the ability to make “executive decisions” by Appellees.

There is also legally insufficient evidence of a breach of a partnership agreement or breach of contract. Any payment by Appellants to themselves for their uncompensated services over four years are compensable through the theory of quantum meruit . There is no express agreement for their compensation for those services.

The withholding of funds to pay the Internal Revenue Service on the profits earned cannot be a basis for a breach of a partnership agreement or contract between the parties for the reason that a party has no legal right to compel another to violate the laws that apply to the transaction.

The division of the payment of proceeds to Appellant Le and her former boyfriend, Tuan Ngo, is not a breach of an implied contract to pay only her because the evidence is insufficient to show any such implied contract. That division is likewise not a breach of any express contract to pay only Appellant Le because there is no evidence of any express contract.

The “contract” claim and “partnership” claim of Appellees are in fact the same. The only contract was the same agreement Appellees call an agreement to be partners. The damages that Appellee claim arise out of the same operative facts. Therefore, the trial court erred in awarding what are the same damages twice, which is not permitted because of the one satisfaction rule.

xv *16 The evidence is insufficient to show the participation by Appellant Vu in any act or omission which was a cause of injury or damages to Appellants, and it was error for the trial court to award a judgment against her as well as against Appellants Nguyen and Ngo.

xvi

POINTS OF ERROR

*17 POINT OF ERROR NO. 1: THERE IS INSUFFICIENT EVIDENCE AS A MATTER OF LAW TO ESTABLISH A PARTNERSHIP BETWEEN THE PARTIES; THEREFORE, THERE IS NO LIABILITY FOR BREACH OF A PARTNERSHIP AGREEMENT.

POINT OF ERROR NO. 2: THE EVIDENCE IS LEGALLY INSUFFICIENT TO ESTABLISH THAT APPELLANTS BREACHED A CONTRACT WITH APPELLEES.

POINT OF ERROR NO. 3: THE EVIDENCE IS INSUFFICIENT TO SHOW ANY DAMAGES FOR BREACH OF A PARTNERSHIP AGREEMENT.

POINT OF ERROR NO. 4: THE EVIDENCE IS INSUFFICIENT TO SHOW ANY DAMAGES FOR BREACH OF A CONTRACT.

POINT OF ERROR NO. 5: THE TRIAL COURT ERRED IN AWARDING JUDGMENT FOR DAMAGES FOR BOTH BREACH OF A PARTNERSHIP AGREEMENT AND BREACH OF CONTRACT WHEN BOTH CAUSES OF ACTION AROSE FROM THE SAME FACTS OR EVENTS.

POINT OF ERROR NO. 6: THE EVIDENCE IS INSUFFICIENT TO ESTABLISH ANY LIABILITY BY APPELLEE DUNG VU BECAUSE THERE IS INSUFFICIENT EVIDENCE THAT SHE ENGAGED IN ANY CONDUCT FOR WHICH APPELLEES COMPLAIN.

1

ARGUMENTS AND AUTHORITIES

*18 Most people who receive a return of several times their investment without any effort on their part are grateful. Appellee Manh Hoang invested $80,000 with Appellants in their purchase, operation and sale of chicken farms in Georgia and Texas, and received in return approximately $400,000. Appellee Dung Le invested $50,000 and received in return approximately $200,000. But instead of gratitude, they felt resentment.

It bothered them that Appellants received some income in which they did not share. Oblivious of the critical importance of management in making a successful business venture, or simply resentful that Appellants received money when they did not, they objected when Appellants told them they were taking part of the profits earned as their compensation for several years of work, risk, and sacrifice. Appellees brought suit because they wanted all the profits distributed to the investors strictly in accordance with their monetary contribution.

Appellees also objected when Appellants withheld funds from the distribution to the investors to pay the Internal Revenue Service for capital gains taxes and taxes they expected to owe because of depreciation recapture. To Appellees payment of taxes was abstract or hypothetical, and they would worry about that later, but the money on the table was real, and they wanted all of it distributed.

Appellee Le also complained that Appellants divided the profit on what she called her investment to between her and a brother of Appellant Ngo, Tuan Ngo, who lived with her for several years, including the time that monies were invested to buy each of the chicken farms.

This case is complicated by the absence of any written agreement between the parties. While 2 *19 not explicitly stated at trial, it appears there is a custom among families of Vietnamese descent to consider written agreements either unnecessary or undesirable. Therefore, much of the trial of this case consisted of the parties recounting what each said, or in many cases, their interpretation or understanding of what was said.

The case was submitted to the jury inquiring about two primary causes of action. First, Appellees claimed that a partnership existed, and that Appellants breached that partnership agreement. Second, they claimed that a contract existed between the parties and Appellants breached that contract. As will be shown the contract was actually the same as what Appellees call an agreement to create a partnership. In this case, the “contract” is the same thing as the “partnership.”

All the damages found by the jury are based on claims that arose at the same time and from the same event, i.e. when Appellants distributed the proceeds from the chicken house investment. The jury found damages arising from both a breach of partnership and from a breach of contract, but did not award any exemplary damages. There is no way to separate damages arising from a breach of partnership from those arising from a breach of contract, and Appellants will show that the court granted Appellees an impermissible double recovery.

3

STANDARD OF REVIEW

*20 This court has already set out the standard of review in a case of this nature, where an appellant attacks jury findings on issues on which he did not have the burden of proof, in Westside Wrecker Service v. Skafi , 361 S.W.3d 153 (Tex.App.–Houston [1 ] 2011, pet.rev.den’d.), and in st st Sewing v. Bowman , 371 S.W.3d 321 (Tex.App.–Houston [1 ] 2012, pet.rev.dism’d.).

4 *21 Point of Error No. 1 Restated: THERE IS INSUFFICIENT EVIDENCE AS A MATTER OF LAW TO ESTABLISH A PARTNERSHIP BETWEEN THE PARTIES; THEREFORE, THERE IS NO LIABILITY FOR BREACH OF A PARTNERSHIP AGREEMENT.

Partnership law in Texas has evolved over the past several years in light of the adoption of the Texas Revised Partnership Act and the later adoption of the T EXAS B USINESS O RGANIZATION C ODE . None of the parties to this suit have ever argued that the TRPA does not control. The agreement of the parties was made in 2006 and the last farm was sold in 2010.

Any analysis of a partnership claim must begin with a review of Ingram v. Deere , 288 S.W.3d 886 (Tex. 2009). That case involved a psychiatrist, Deere, who agreed to serve as the medical director of a pain clinic and who claimed that he became a partner with a psychologist, Ingram. Initially they had no written agreement. Fourteen months later Ingram presented to Deere a “Physician Contractual Employment Agreement” which Deere refused to sign because he contended he was to be a partner. Deere brought suit claiming he was entitled to damages as a partner.

The Court applied the TRPA, which provides that “an association of two or more persons to carry on a business as owners creates a partnership,” and then enunciates the elements of a partnership. Those elements are:

(1) receipt or right to receive a share of profits of the business; (2) expression of an intent to be partners in the business; (3) participation or right to participate in control of the business; (4) sharing or agreeing to share:

(A) losses of the business, or 5 *22 (B) liability for claims by third parties against the business; and (5) contributing or agreeing to contribute money or property to the business. The elements that control under the TRPA vary somewhat from the common law requirements, as the court noted. Ingram , p. 895-896. Instead of requiring proof of all elements, the Court held that a “totality-of-the-circumstances test” would be the measure by which courts would determine the existence of a partnership. If none of the elements exist, then a partnership cannot be created. Conversely, if conclusive evidence on all the factors is found, a partnership exists as a matter of law. This case now before the court falls in between the two ends of the spectrum: there is evidence on some factors and none on others. Each element will be considered in the order listed in Ingram . Receipt or Right to Receive a Share of Profits:

No dispute exists that the parties agreed to share profits. It was uncontradicted that Appellant Ngo contacted his brother, Tuan Ngo, who lived with Appellee Le, and told him if they contributed money toward Appellants’ purchase of a chicken farm in Georgia that they would share in any profits made. Appellants made the same offer to Appellee Hoang. There is no dispute that Appellee Hoang contributed $80,000 and that he received in return approximately $400,000. There is a disagreement as to whether Appellee Le alone, or she together with Tuan Ngo, made a contribution, but no dispute that a contribution of $50,000 was made which resulted in a return of over $200,000. Expression of Intent to Be Partners:

The expression by the parties of their intent to be partners can be shown in several ways. Some examples noted by the Court in Ingram are “statements that they are partners, one party holding the other party out as a partner on the business’s letterhead or name plate, or in a signed partnership

6 *23 agreement.” Ingram, p. 900. Another indication might be a party referring to another as his partner in a conversation with a third party. An example of such a reference to another as his “partner” is found in Cintrin Holdings, LLC v. Minnis , 2013 Tex.App. LEXIS 5723 (Tex.App.–Houston [14 ] th 2013, pet.rev.den’d.).

There must be some evidence that both parties expressed their intent to be partners. Reagan v. Lyberger , 156 S.W.3d 925, 928 (Tex.App.–Dallas 2005, no pet.); Hoss v. Alardin , 338 S.W.3d 635, 641 (Tex.App.–Dallas 2011, no pet.); Brown v. Keel , 2012 Tex.App. LEXIS 1854 st (Tex.App.–Houston [1 ] 2012, no writ hist.).

The court must inquire separately whether there exists evidence of an intent to be partners, and a court should “only consider evidence not specifically probative of the other factors.” Sewing st v. Bowman, 371 S.W.3d 321, 333-334 (Tex.App.–Houston [1 ] 2012, pet.rev.dism’d.), citing Ingram . Thus the court can only look to the expressions of intent by the parties or to their representations to third parties.

This case involves a purely oral agreement, which creates other issues. The terms of an oral contract must be “clear, certain, and definite.” Knowles v. Wright , 288 S.W.3d 136 st (Tex.App.–Houston [1 ] 2009, pet.rev.dism’d.); Gannon v. Baker , 830 S.W.2d 706, 709 (Tex.App.–Houston (1 ] 1992, writ den’d). Reliance on what one party says does not establish what st both agreed to. There must be evidence that “both parties expressed their intent to be partners.” Hoss v. Alardin, p. 644. The opinion of a lay witness that a partnership has been created is not competent evidence of a partnership. Westside Wrecker Service v. Skafi , 361 S.W.3d 153, 169 st (Tex.App.–Houston [1 ] 2011, no writ hist.).

7 *24 There is absolutely no documentary evidence of a partnership in this case. No document ever referred to any of the parties as partners. All documents executed in connection with the purchase, improvement, operation and sale of the two chicken farms show Appellants only as the owners. All loan documents executed with financial institutions were executed solely in Appellants’ names. All contracts and correspondence with the chicken producer, Sanderson Farms, name Appellants alone as owners. No bank account or record showed or referred to the names of Appellees, but instead showed Appellants as owners of the account.

There is likewise no testimony by any third party that any of the parties represented to them that they were partners nor is there is any evidence that any of the partners referred to themselves as partners.

The only evidence in this case of an intent to be partners is by Appellee Hoang. He testified that “we all agreed we are owners.” (RR Vol. 2, p. 118). Yet there is no evidence of that intent being expressed to anyone any time, to a lender, contractor, chicken producer, employee, or to anyone. Another portion of Appellee Hoang’s testimony really says what the parties agreed to. His counsel asked him if he wanted to be a “partner” and his response was “we agreed at the first time if we make it, everybody will make it.” (RR Vol. 3, p.126). That testimony is consistent with Appellants’. They testified that if they made profits all would share in them. But an agreement to share profits alone is not evidence of an intent to be partners. Appellant Ngo made the distinction when he said Appellees were not owners or partners, but that “they invest–what I call is they put in money in there to earn the profit.” (RR Vol. 3, p. 27).

The court noted in Ingram that “[t]he Legislature does not indicate that it intended to spring surprise or accidental partnerships on independent business persons” (p. 898). The intent to be 8 *25 partners must be mutual, and the evidence in this case lacks evidence of mutual intent to be partners. Right to Control the Business:

The right to control is generally considered one of the most important of the factors considered in evaluating whether a partnership existed. Big Easy Cajun Corp. v. Dallas Galleria Ltd. , 293 S.W.3d 345, 348 (Tex.App.–Dallas 2009, pet.rev.den’d.). The court in Ingram said that the right involves “the right to make executive decisions.” So a review of the evidence in this case of the right of the parties to make those “executive decisions” is in order.

One of the first “executive decisions” a party makes is controlling access to the business’s books and records. In Ingram the court cited Tierra Sol Joint Venture v. City of El Paso , 155 S.W.3d 503 (Tex.App.–El Paso 2004, pet.den’d.), as holding that a party cannot be in control of a business if he does not have control over and access to its books. In this case, there is no evidence that Appellees had any control over the books and records of the chicken farms. Instead, Appellants kept the books themselves and were the only parties who even knew whether the chicken farms had made a profit. ^[2]

Another of the “executive decisions” made by those who are partners is to have the right to write checks on the business checking account. Guerrero v. Salinas , 2006 Tex.App. LEXIS 8562 (Tex.App.–Corpus Christi 2006, no pet.), cited by the court in Ingram. Appellees failed to show they even knew where Appellants had a bank account, much less had access to it.

There is some evidence that Nguyen and Ngo talked to Hoang and Le on a few occasions about *26 their plans, i.e. deciding to sell the farm in Georgia, the decision to buy property and build a farm in Robertson County in Texas, but the decision to sell the Texas farm and distribute the proceeds was made by Appellants alone. (RR Vol. 3, p. 186-187). In Malone v. Patel , 397 S.W.3d 658, 676 st (Tex.App.–Houston [1 ] 2012, pet.rev.den’d.), this court addressed the claim by one party that he had “control” because the other discussed with him decisions that were made, and the financial condition of the business, and concluded that this was no evidence that he actually made any executive decisions and had control. To phrase it differently, conversation does not equal control. Sewing v. Bowman , 371 st S.W.3d 321 (Tex.App.–Houston [1 ] 2012, pet.rev.dism’d.).

What does the evidence show in this case? It shows first that it was the decision of Appellants to go into the chicken business. They first worked on farms owned by friends to learn how to operate a chicken farm and found a farm to purchase, negotiated an agreement with Sanderson Farms, the chicken producer, and qualified as a grower for Sanderson before they ever talked to Appellees about investing. According to Appellants’ testimony they could have found the money to make the purchase elsewhere, so the Appellees’ participation was not critical to the venture. (RR Vol. 4, p 78). Further, neither of the Appellees had any knowledge or experience that was necessary to operate a chicken farm: they were investors only.

Appellants also made all the arrangements for financing, to borrow over a million dollars to purchase the Georgia farm. There is no evidence that Appellees chose the lender, investigated the loan terms to decide if the loan was suitable, or discussed the loan with the lender. In fact, no evidence exists that the lender even knew that Appellees existed.

When Appellants decided to buy land and build a chicken farm in Texas it was their decision where to purchase property. (RR Vol. 2, p. 110). There is no evidence that the approval of Appellees 10 *27 or any other investor was either sought or acquired. In this farm as well as in Georgia, Appellants decided who would work on the farm and what they would be paid. Appellee Hoang’s own testimony testimony makes clear his lack of control. (RR Vol. 2, pp. 132-142). He had nothing to do with any of the negotiations for the land, the construction of the farm, the grower contract, or the bank loan required to purchase the land and build chicken houses. He did not even meet the contractors who prepared the site and built the chicken houses. He did not keep the bank account nor did he pay any bills for the business. Appellants handed the checkbook and signed checks.

In responses to questions about the relationship between the chicken farm and Sanderson Farms, the producer, Appellee Hoang testified that he had no dealings with Sanderson, that “The chicken company they only deal with the owners of the company” ( emphasis added ). (RR Vol. 2, p.140). Those “owners” were Appellants, not him. He also testified that “I just do whatever Phap Nguyen and Andy Ngo tell me to do.” (RR Vol. 2, p.141).

When asked “what you did without talking to Andy and Phap first” Hoang responded: A When I drive the tiller to prepare the road, and I just drive the lawnmower. I do not need to talk to them or ask them. As to the anything need to be done, I do it.

Q Can you tell me anything else that you ever did on the farm without asking them first? A Many things, but I cannot. Q Tell me what they are. A This cleaning the ditches to make the road so that the vehicle can

drive in. Pave the cement. Do the flooring for the mobile home. From his testimony it is apparent that Appellee Hoang made no executive decisions in operating the chicken farm. Actually the evidence showed that Appellee Hoang worked as a laborer in the chicken

11 *28 houses and that Appellants “fired” him as an employee because of their dissatisfaction with his job performance and his lack of responsibility. (RR Vol. 3, pp 185-186; Vol. 3, p. 34-36).

Finally, one of the most telling admissions by Appellee Hoang of a lack of control over the venture was this response: Q The chicken farm in Texas, who made the decision to sell it? A Those two, because of their name on the document.

Further, when asked about the sale of the chicken farm in Georgia Appellee Hoang stated “ the deal was handled by those two people.” (RR Vol. 3, p. 131). Appellee Nguyen testified that the decision to sell the farm in Georgia was his and Appellee Ngo’s, and they did not talk to Appellees about selling it before they made the decision. (RR Vol. 3, p. 176). There can be no executive decision more important to a business venture than to sell the business itself and cease all operations. A sale of the chicken farm would end the venture and the relationship of the parties. One who has no say in such a decision cannot claim he had the right to make executive decisions.

There is no evidence at all that Appellee Le ever participated in any decision necessary in the purchase, operation or sale of the chicken farms in Georgia and Texas. She was present at the final distribution of funds from the venture, but there is no evidence that she participated in any of the business decisions that were made. Sharing or Agreeing to Share in Any Losses:

An agreement to share losses of a business or to pay debts to third parties is a good indicator of an ownership status. This case lacks any evidence that either Appellee ever paid, or expected to pay, any losses of the business or to pay a debt of the chicken farm to a third party. It was clear from

12 *29 the beginning that only Appellants stood to lose if the venture failed. (RR Vol. 2, p. 63). Appellee Ngo understood at all times that if the business failed he would lose everything, his time, for the liability for the bank loans, everything. But he did not expect Appellees to be responsible for any losses. (RR Vol. 2, p. 81).

At every stage it was Appellants who made up any shortfall. For example, in Georgia, when the farm with its initial six chicken houses was not producing enough income to even pay the farm utilities and operating expenses, it was Appellants who came up with the funds. For a time the needed funds came from the income of Appellant Dung Vu, earned in her decorating business in New Orleans. (RR, Vol. 3, pp 170-171). Appellees contributed nothing.

When Appellants realized that building two more chicken houses on the farm in Georgia was necessary to make the farm economically viable, they invested back into the farm what they would normally have paid themselves as labor expense (they paid themselves and all employees an amount whenever a batch of chickens was sold to defray their basic living expenses ) in order to have the funds necessary to build the additional houses. (RR Vol. 2, p. 84-85; Vol 3, p. 171). Appellees contributed nothing.

In both Georgia and Texas it was Appellants who assumed the full legal liability for bank loans to purchase and/or build the farm. (RR Vol. 2, p. 81). After Appellants made the decision to move to Texas and build a farm in Robertson County, they learned that Sanderson Farms would allow them to add another eight chicken houses, expanding from 16 to 24 and increasing the farm’s profitability. It was Appellant Nguyen who borrowed $400,000 from family or friends to come up with the necessary funds. (RR Vol. 3, p. 87-88). Appellees incurred no legal liability.

13 *30 Appellants never told a creditor of the chicken farms that Appellees had anything to do with the farm, much less that they would be liable for debts incurred. Likewise, there is no evidence that Appellees ever told a creditor or third party that they were liable for debts of the business. In this case it is clear that evidence does not exist on this element of a partnership. Contributing or Agreeing to Contribute Money or Property to the Business:

It is not contested that Hoang invested $80,000 and Le (with Tuan Ngo) $50,000 to purchase the chicken farm in Georgia. Summary: The Totality of the Evidence Shows that Appellees were not Partners:

Appellees satisfy two of the elements necessary to the creation of a partnership. They both contributed money and were entitled by agreement to a portion of the profits earned. But in many critically important ways there is no evidence of a partnership. No evidence exists that the parties referred to themselves as partners or represented to others that a partnership existed. There is no evidence that Appellee’s ever lost or stood to lose anything other than their investment. And most important of all, Appellee’s had no control over the executive decisions made in the business, a clear indicator that they were investors but not partners. Point of Error No. 2 Restated: THE EVIDENCE IS LEGALLY INSUFFICIENT TO ESTABLISH

THAT APPELLANTS BREACHED A CONTRACT WITH APPELLEES.

Point of Error No. 3 Restated: THE EVIDENCE IS INSUFFICIENT TO SHOW ANY DAMAGES

FOR BREACH OF A PARTNERSHIP AGREEMENT.

Point of Error No. 4 Restated: THE EVIDENCE IS INSUFFICIENT TO SHOW ANY DAMAGES

FOR BREACH OF A CONTRACT.

14 *31 As the breach of partnership and breach of contract claims are based on the same operative facts and the same damages were claimed for both alleged breaches, Appellants will address the issue of damages in a combined argument applicable to both claims.

Appellee Hoang was asked what he claimed that Appellants had done to harm or injure him. His answer was that (1) they had paid themselves 20% of the profits made from purchase, management, and sale of the chicken farms as compensation for their management of the chicken farms, and (2) they had held out funds from the distribution made after the farm in Texas was sold to pay the Internal Revenue Service.

Appellee Le’s testimony is somewhat confusing. She is clear that she objected to Appellants paying themselves any compensation for their services, about withholding any funds to pay taxes, and about the division between the distribution between her and her former boyfriend. (RR Vol. 2, p. 57- 58).

On the issue of labor, she seems to assert that Appellants were already paid for their services. (RR Vol. 2, p.20). She testifies that they were paid $3,500 per month. Later, it becomes clear that this testimony is incorrect. She admits that they were paid $3,500 per batch of chickens sold and that five batches a year were sold (RR Vol. 2, p. 47-48), which means that Appellants received only $17,500 per year, paltry compensation for working 12-14 hours a day, going without pay for nearly two years, and assuming personal liability for about $7,000,000 in bank loans.

With respect to Appellants’ withholding of funds to pay taxes she testified that “the tax money had been deducted before giving this money to me.” (RR Vol. 2, p. 51). She said she had not reported the gain she received because “Andy said he had already paid tax for that portion already. When asked what she wanted, she said “I just want Andy to pay me the tax back to me so I can report to the IRS.

15 *32 (RR Vol. 2, p. 54). Of course, the problem with that position, as explained by Appellants’ accounting expert, is that the IRS considers Appellants as the taxpayer because Appellants were the purchasers and sellers of the farms.

Le also complains that Appellants should not have divided the profits from the chicken farm operations with Tuan Ngo. (RR Vol. 2, p. 57). Her testimony fails to show that Appellants should have known that only she was entitled to profits. She admitted that when the money was sent to Appellant Ngo that there was nothing with the money “that said whose money its was.” (RR Vol. 2, p. 42). She likewise admitted that she never gave anything that said that “this is my part and this is Tuan’s part.” (RR Vol. 2, p. 42). Other evidence shows that Tuan Ngo’s paycheck from working on the chicken farm went to Appellee Le and that distribution of funds made by Appellants on another occasion was divided between Appellee Le and Tuan Ngo. Payment of 20% of Net Profits to Appellants a Breach of a Partnership Agreement or Contract?:

It was uncontradicted that when Appellants made a final distribution of profits from the sale of the chicken farm in Robertson County that they deducted from the amount distributed to the investors 20% of the profits as compensation to them for their services provided. It is uncontradicted that the parties did not discuss at the beginning of the business that Appellants would charge for their services. Counsel for Appellee Hoang asked Appellant Ngo why he should be entitled to compensation out of profits while Appellee should not, when he also worked on the farm. Appellant Ngo clearly explained the difference between one who is a common laborer and can be replaced, and one if has overall responsibility for managing the business. (RR Vol. 2, p. 106-107).

Appellants believe that the basic source of error in the jury verdict in this case was a 16 *33 presumption by the jury that a party is only entitled to be paid for services rendered if there is an express agreement to that effect, while the law in Texas is actually that a party is entitled to compensation unless an express agreement establishes the compensation due for those same services.

There is a fundamental difference in compensation to Appellants for a return on the monies they invested, and the services they provided. They are entitled to be paid a return on their monetary investment just as are Appellees. But Appellees refused to accept that Appellants were also entitled to be paid for their management services, additional investments, sacrifices, and assumption of debts on the business. Appellee Hoang’s opinion at trial was that “we are all the same,” meaning that a return on investment is all anyone is entitled to receive. (RR Vol 3, p. 129).

His opinion is incorrect under Texas law. Texas recognizes that a party may have a claim for services rendered even when there is no contract providing for that compensation. Truly v. Austin , 744 S.W.2d 934, 936 (Tex. 1988). The underlying theory is that it would be unjust for a party to receive benefits as the result of the efforts of another without paying the value of those benefits to the party who did the work. Baldwin v. Smith , 586 S.W.2d 624, 632 (Tex.Civ.App.–Tyler 1979), reversed on other grounds 611 S.W.2d 611 (Tex. 1980); Murphy v. Canion , 797 S.W.2d 944 (Tex.App.–Houston th [14 ] 1990, no writ hist.).

The elements of a claim in quantum meruit are as follows: 1. valuable services were rendered; 2. for the person sought to be charged; 3. the services were accepted by the person sought to be charged, used and enjoyed by

him; 4. under circumstances as reasonably notified the other person that there was an expectation of being paid. 17 *34 Vortt Exploration Company v. Chevron , 787 S.W.2d 942 (Tex. 1990). There is no doubt that Nguyen and Ngo rendered valuable services. They spent uncompensated

time learning the chicken business before deciding to enter it, secured grower contracts, financed the construction of two chicken houses in Georgia by foregoing any payment of even basic living expenses to themselves so that the farm could build the houses; assumed debt in excess of seven million dollars; went months without compensation in Georgia while they operated a chicken farm there (they reinvested their wages for their farm labor, while no other investor did so); worked long hours (RR Vol. 3, p. 209) while the other investors were free to engage in other gainful employment; went without compensation for a year after selling the Georgia farm while they purchased and constructed the farm in Texas (RR Vol. 3, p. 180); and then operated the farm in Texas on a full-time basis and negotiated a sale of it at a substantial profit to all investors.

The services were rendered for all investors, not just Appellees. While Appellants also received a distribution of profits, their proportionate part of those profits on their monetary investment was no greater than that of the other investors. And the amount of the return they received on their monetary investment was only a small fraction of what they earned for all investors.

Appellants’ services were accepted by all the investors, including Appellees. While Appellees were not in control of the operations of the chicken farms, they were aware that the farms had been purchased by Appellants; that Appellants were living on the farms and operating them; that Appellants received no compensation for long periods of time while they put together the deals; that Appellants put in many, many hours managing the farms; that Appellants had over the time the farms were operating assumed personal liability for approximately seven million dollars in debt; and that the farms would never have been purchased and would have never earned any return to the investors without

18 *35 Appellants’ management skill and effort. Finally, was there anything about what Appellants did that would put Appellees on notice that they expected to be compensated for their services? Appellees were free to run their own businesses or seek other employment but Appellants were committed to full-time operation of the farms. Appellees knew that for substantial periods of time Nguyen and Ngo were working without any compensation at all for their services. That knowledge alone was sufficient to put anyone on notice that a return on their monetary investment alone would not fully compensate Appellants and at some point they expected to be compensated by something more.

An agreement to divide any return on a monetary investment in the chicken houses would not preclude Appellants from claiming compensation for their management services and labor. In Black Lake Pipe Line Company v. Union Construction Company , 538 S.W.2d 80 (Tex. 1976), the court held that even if the parties have an express contract that provides compensation for some services a party can recover the reasonable value of other services which were rendered and accepted that were not covered by the express contract.

This case is in an unusual posture. It is not a suit by Appellants seeking a judgment that Appellees should be ordered to pay them reasonable compensation, but instead a suit by Appellees to recover damages because Appellants already paid themselves that compensation. Since the compensation has already been paid, Appellants contend they had no duty at trial to prove that their compensation was reasonable, but that Appellees had a burden to show it was unreasonable.

When the agreement between the parties was silent on the question of compensation by Appellants for their services there is no evidence that by charging for their efforts they breached any partnership agreement. If the jury found a breach of a partnership agreement or contract because

19 *36 Appellants were paid for their services, it is not supported by any evidence because it is presumes that Appellants were only entitled to be paid for their services if they expressly contracted to be paid. Is Withholding Money from a Distribution of Profits to pay Federal Taxes a Breach of a Partnership Agreement Or Contract?:

Appellees also contended at trial that Appellants breached their “partnership agreement” by withholding monies to pay the Internal Revenue Service for taxes on capital gains arising from the purchase and sale of the chicken farms and for taxes on ordinary income as a result of recapture of depreciation expense deductions taken on the farms. Appellees claimed that Appellants should instead give them the amount of money withheld for payment of taxes and it would be up them whether to report the income and pay taxes on it.

Those taxes were explained by Michael Halls, a C.P.A. called by Appellants as an expert. He testified that there would be a capital gains tax liability on the sale of the chicken farm(s), and in his opinion the Internal Revenue Service would assess that liability against Appellants because they were shown as the owners of the farm. (RR Vol. 4, p. 21).

Halls also testified that there would be a tax liability in the form of a “recapture” of depreciation expensed on the farm. (RR Vol. 4, p. 15). His testimony was that Appellants would be responsible for payment of those taxes. He further testified that while the methodology used by Appellant Ngo to calculate the expected tax liability was not the same as a certified public accountant would use, it was a reasonable method of calculating the tax liability. (RR Vol. 4, p. 21).

The issue here is whether one can be in breach of a contract by compliance with the Internal Revenue Code. Appellants argued that any tax liability from the sale of the chicken farm will fall on them, so they are justified in withholding the amount of that tax liability from the proceeds distributed.

20 *37 In other words, they take the funds because they will owe the taxes. Appellants had no way of compelling Appellees to pay the IRS if they distributed all the profits to them. Appellants did not trust Appellees. That Appellees insisted on being paid in cash at the time of the final distribution contributed to Appellants’ doubt Appellees would report and pay taxes on any profits distributed to them. (RR Vol. 3, p. 59). It was not unreasonable for Appellants to hold the money that would be owed.

Appellees questioned whether the sale of the chicken farm in Robertson County and the reinvestment by Appellants properly qualified as what was referred to as a “Section 1031 exchange,” in an attempt to raise doubt with the jury as to whether a tax liability actually existed. If the transaction does not qualify as a Section 1031 exchange, Appellants will be liable immediately for the taxes. (RR Vol. 4, p. 71). Deferring payment of the capital gain taxes in no way injures Appellees: they have what was distributed to them free and clear of any tax liability because Appellants assume payment of any taxes due. Was It a Breach of a Partnership Agreement or Breach of Contract to Divide Proceeds between Appellant Le and Tuan Ngo Rather than Pay All the Proceeds to Appellee Le?:

In addition to those claims on which she joins Appellee Hoang, Appellee Le makes an additional claim, i.e. that Appellants breached their agreement with her by paying part of the distribution of profits to Tuan Ngo. She claims she contributed $50,000 and she alone is entitled to a return on the investment of that amount. To understand this issue requires reviewing the facts and circumstances under which the investment was made.

There is no evidence that Appellants ever represented to anyone that they would pay a proportionate part of any distribution solely to Appellee Le. If there is any basis for that claim, it must be an implied promise. The evidence shows, however, that the investment Appellee Le claims to have

21 *38 solely made was actually made as the result of a conversation between Tuan Ngo and Appellant Ngo, not as the result of a conversation between Appellee Le and Appellant Ngo.

Tuan Ngo and Appellee Le lived together for seven years. (RR Vol. 2, p. 41). Appellant Ngo’s uncontradicted testimony was that he contacted Tuan Ngo about investing in the purchase of the farm. Tuan Ngo told him he would talk to Appellee about it. Tuan Ngo, not Appellee Le, then contacted Appellant Ngo and said that “they” would invest in the farm.

Appellant Ngo then received a check in the agreed amount of the investment drawn on an account solely in Appellee Le’s name. Neither Appellee Le nor Tuan Ngo gave anything to Appellant Ngo that said whose money was being invested. (RR Vol. 2, p. 42). Appellant Ngo later learned other information that confirmed the investment was made jointly. Tuan Ngo worked on the farm for a period of time as a laborer and instructed Appellant Ngo to make his paychecks payable to Appellee Le and those checks were sent to her. When asked how Appellant Ngo “is supposed to know that Tuan is not supposed to get any of the money?” Appellee Le responded “Because of my money.” (RR Vol. 2, p. 42).

A distribution of some accumulated profits was made at one time to Appellee Le in the amount of $14,000: she told Appellee Ngo that she divided those funds with Tuan Ngo. (RR Vol. 2, p. 113). At the time of the distribution of the funds Appellant Ngo put the money down on the table to pay Appellee Le and then she told him to give Tuan Ngo his part, and he did so. (RR Vol. 2, p. 117).

Is the evidence sufficient to show the existence of an implied agreement to pay only Appellee Le? To put the question another way, should Appellant Ngo have known from the facts and circumstances that only she was to be paid at the time of the final distribution of the proceeds from the sale? Given the circumstances, the answer is “no.” Appellee Le’s real complaint is not that Appellant

22 *39 disregarded any agreement or understanding, but rather that she and Tuan Ngo have parted ways and she did not want to split the profit from the investment with her ex-boyfriend.

An implied agreement may arise out of the regular course of conduct between the parties. Schuhardt Consulting Profit Sharing Plan v. Double Knobs Mt. Ranch, Inc. , 2014 Tex.App. LEXIS 13417 (Tex.App.–San Antonio 2014, rev’d. in part; aff’d. as modified). There must exist a meeting of st the minds. Prime Prods, Inc. v. S.S.I. Plastics, Inc. , 97 S.W.3d 631, 636 (Tex.App.–Houston [1 ] 2002, pet. denied).

In this case there is insufficient evidence to support a finding that an implied agreement between Appellee Le and Appellants existed that only she should be paid any proceeds from the investment made by her and Tuan Ngo. She cannot hold Appellants liable on an implied agreement to pay only her because there was no meeting of the minds that she alone would be paid. Prime Prods, Inc. There is no basis for a finding of breach of an agreement because of the payment of the proceeds from an investment to both investors.

Counsel for Appellee also alluded several times during the trial that there was some duty by Appellants, either by contract or by implication, to include Appellees as owners on the chicken farms they owned at the time of trial. (RR Vol. 2, p. 100). This argument is essentially that once someone is partner he has a right to be a partner thereafter in any venture and to participate in other ventures of Appellants. As a matter of law that claim is not valid. Rankin v. Naftalis , 557 S.W.3d 940 (Tex.1977); Greenberg Traurig, LLP v. National American Insurance Company , 448 S.W.3d 115 (Tex.App.–Houston [14 ] 2014). Appellants agreed to participate with Appellees in one venture, a th chicken farm, and when that farm was sold no continuing business relationship continued. (RR Vol. 2, p. 100). Further, there is no competent evidence of the value of Appellants’ farms or any other basis

23 *40 upon which the jury could have calculated Appellee’s damages based on that argument. Point of Error No. 5 Restated: THE TRIAL COURT ERRED IN AWARDING JUDGMENT FOR DAMAGES FOR BOTH BREACH OF A PARTNERSHIP AGREEMENT AND BREACH OF CONTRACT WHEN BOTH CAUSES OF ACTION AROSE FROM THE SAME FACTS OR EVENTS.

Texas long ago adopted what is called the “one recovery rule.” Southern County Mutual Insurance Company v. First Bank & Trust , 750 S.W.2d 170 (Tex. 1988); Stewart Title Guaranty Co. v. Sterling, 822 S.W.2d 1, 7 (Tex. 1991); Crown Life Ins. v. Casteel , 22 S.W.3d 378, 390 (Tex. 2000). This means that generally when a party recovers damages under two different theories or causes of action that arise from the same operative facts he must elect one but cannot recover on both.

That rule was illustrated in a partnership case, Murphy v. Seabarge, Ltd. , 868 S.W.2d 929 th (Tex.App.–Houston [14 ] 1994, aff’d.). One party claimed that the other had paid himself more than their partnership agreement allowed. Those payments became an issue, because unlike this case, the partnership was unable to service its debt and funds were not available to pay a management fee. The jury found that the payments made were self-dealing, a breach of the partnership agreement and a breach of fiduciary duty. The court noted there was no distinction between the acts that constituted self- dealing, a breach of fiduciary duty, or violations of the Partnership Agreement: all were based on the same actions. The court held that the plaintiff was only entitled to recover one compensation for its loss as the result of the conduct of the defendant, and that since the jury questions inquired about damages for the same conduct the judgment resulted in an impermissible double recovery. Murphy p. 937.

Appellants recognize that in some situations, when there is an additional basis for damages together with actual damages, that a party may recover additional damages arising from the same fact 24 *41 situation. For example, one could be found to have committed a violation of a common law duty and also to have violated the Texas Deceptive Trade Practices Act, T EXAS B USINESS AND C OMMERCE C ODE § 17.41, et. seq . In that case it is possible to recover additional damages allowed by statute. But in the case before the court, the jury did not award any exemplary damages and only awarded actual damages.

Murphy is on all fours with the case before this court. In this case there is only one contract, according to Appellees, which they say was an agreement to form a partnership. The acts they complain of are the payment by Appellees to themselves of compensation for their management and labor, withholding funds to pay taxes, and for Appellee Le, a complaint that someone else received funds she was entitled to solely receive. All of these complaints arise out of the same event, i.e. the distribution of funds by Appellees. And the “contract” is the “partnership agreement.” Therefore, awarding damages both for “breach of contract” and for “breach of a partnership agreement” is a double recovery of damages for the same conduct. Point of Error No. 6 Restated: THE EVIDENCE IS INSUFFICIENT TO ESTABLISH ANY LIABILITY BY APPELLEE DUNG VU BECAUSE THERE IS INSUFFICIENT EVIDENCE THAT SHE ENGAGED IN ANY CONDUCT OF WHICH APPELLEES COMPLAIN.

All the evidence shows regarding Appellant Vu is that she is married to Appellant Nguyen, she provided financial support to the chicken farm in Georgia with funds she earned in her business, and she was a signatory on the title documents for the farms and on the loan documents with the lenders. There is no evidence that she calculated the amounts that Appellants Nguyen and Ngo decided to withhold from the final division of proceeds and there is no evidence that she made the decision to withhold funds from the distribution to the investors.

25 *42 A wife is not automatically liable for any obligations created by her spouse. T EXAS F AMILY C ODE § 3.201(a). A spouse is only liable for the acts of her spouse if the spouse acts as her agent or if the debt is created for “necessaries.” There is no evidence that Appellees provided Appellant Vu’s family “necessaries.” There is no evidence that Appellant Nguyen was acting as an agent for Appellant Vu.

T EXAS F AMILY C ODE § 3.201(c) explicitly states that a spouse is not automatically considered an agent because parties are married. Some evidence of an agency relationship is required. Appellee Vu signed the title documents and loan papers herself. There is no evidence that her spouse acted for her under a power of attorney or delegation of authority. There is no basis for an award of damages against Appellant Vu.

26

CONCLUSION

*43 Appellants request that this court reverse the judgment of the trial court and render judgment that Appellees take nothing by way of this suit. If this court rules that the evidence is insufficient to show the parties were partners it should render judgment that no partnership existed between the parties and reverse the award of damages for breach of partnership against Appellants.

If the court affirms the judgment of the trial court that the parties were partners, the award of damages for breach of partnership should be reversed as there is legally insufficient evidence of such a breach.

The court should reverse the award of damages for breach of contract for the reason that the evidence of breach is legally insufficient to support that award. If the court affirms the judgment of the trial court that the parties were partners and that both a breach of the partnership agreement and a breach of contract occurred, the court should require Appellees to elect which damages they choose to retain, as the award of damages on both claims is an impermissible double recovery of damages arising from the same facts.

The court should reverse any judgment against Appellant Dung Vu as the evidence is insufficient that she committed any act or omission which Appellees claim was a cause of injury to them resulting in damages.

The court should award all costs of this appeal to Appellants. 27 *44 Respectfully submitted, Tom Rorie State Bar No. 17238000 210 North Street Nacogdoches, TX 75961 (936) 559-1188 FAX (936) 559-0099 ATTORNEY FOR APPELLANTS

CERTIFICATE OF COMPLIANCE Pursuant to T EXAS R ULE OF A PPELLATE P ROCEDURE 9.4(i)(3), I hereby certify that this brief contains 10,743 words (excluding any caption, identity of parties and counsel, statement regarding oral argument, table of contents, index of authorities, statement of the case, statement of issues presented, statement of jurisdiction, statement of procedural history, signature, proof of service, certification, certificate of compliance, and appendix). This is a computer-generated document created in WordPerfect, using 12-point typeface for all text. In making this certificate of compliance, I am relying on the word count provided by the software used to prepare the document.

Tom Rorie

CERTIFICATE OF SERVICE

I certify that a copy of the foregoing document has been served on counsel for Appellees this th 29 day of July, 2015, by e-file service. Tom Rorie 28

NO. 1-15-00352-CV

*45 ______________________________ IN THE FIRST COURT OF APPEALS AT HOUSTON, TEXAS ______________________________ PHAP V. NGUYEN, ANDY NGO, and DUNG T. VU, Appellants

VS.

MANH HOANG and DUNG LE, Appellees ______________________________ th Appealed from the 55 Judicial District Court of Harris County, Texas ______________________________

APPENDIX TO APPELLANTS’ BRIEF

______________________________

TOM RORIE

State Bar No. 17238000 210 North Street Nacogdoches, TX 75961 (936) 559-1188 FAX (936) 559-0099 ATTORNEY FOR APPELLANTS

ORAL ARGUMENT REQUESTED *46 APPENDIX No. Document 1 Plaintiffs’ Original Petition 2 Charge of the Court 3 Final Judgment 4 Motion for Judgment Notwithstanding Verdict, Motion to Disregard Jury Findings,

and Objections to Proposed Final Judgment 5 Motion for New Trial ii *47 U no ff i c i a l  C op y  O ff i c e  o f C h r i s  D an i e l  D i s t r i c t C l e r k *48 U no ff i c i a l  C op y  O ff i c e  o f C h r i s  D an i e l  D i s t r i c t C l e r k *49 U no ff i c i a l  C op y  O ff i c e  o f C h r i s  D an i e l  D i s t r i c t C l e r k *50 U no ff i c i a l  C op y  O ff i c e  o f C h r i s  D an i e l  D i s t r i c t C l e r k *51 U no ff i c i a l  C op y  O ff i c e  o f C h r i s  D an i e l  D i s t r i c t C l e r k *52 U no ff i c i a l  C op y  O ff i c e  o f C h r i s  D an i e l  D i s t r i c t C l e r k *53 U no ff i c i a l  C op y  O ff i c e  o f C h r i s  D an i e l  D i s t r i c t C l e r k *54 ' Wl'lL rn

'.A"L;,r*Wy ca-"/43 o0 oat J oostr4f, te ryg.1 . ._L (/ t\- I 'ltlc-Lu_ i\A_ ^ 5d"tp d"^;: W

ttr.r,"r,t "r'"1" eoci*,L ,{{ Ft\ | n. 77 5r?e ,- 'li': Plc+ro rctiin thls fecoipl rro(i I yoJ rccclvc you, axaurrt rtatcutonL . '." 'r'/ 'i Thrilk you for blnkloB wlth Brok of Arlerlcr, . T'ry Oollae Bankhrg rt rnrv,brakofrrncrlcr.coru ilr.rn 00106 09/28/2Et)7 ,13:09 ltIX

iR/Itl 54.0s8013? Cc 0002'106.i'Ttr ^[00006] lAcrount. ltt*tttt6t31 {}.css [rsh ,

;); {0,c0 t .' , iDnposit !. cKfilHJ*t*8tfi*t*tt*tl* 06/08 ^[1]

I

I lt,t. I $(}/

4ll itcrirs ui crcdircd subJcci to wiiflcarlo,t coltectlbn. an<l condirions lh9 Rutc$ riid.Ecgrrtitionl oftJril Bantr and 8s olhcnvisc provided by.lqu l'rym!nts sr6 ic4.plid.whe{ crc{it is aopliid i; ooctandinc t ncas a d no{ upon lssuancc of tlrir rcccipl Treruactloos rcccivcd -of afler hc llank's posttd cut+fftinrd oi Sarurday, $unrlay, rna nenk t-lo rro datod nqd consldcrcd ttcci$ as the next bl+incss dry. Plc{$c rctain thk rcac;pr in0l you abcolv€ ,/our aocounr steiem'cnt. . Thrnk iou for brulilng wlth Ilrnk ofAnrcrlcr, 1' . Try Ontlne Ornklng r{ mrv,binkofrrire rlc{,C.orrr

Tran'000510..04/lB/2006 09:t6 rntity.NllJ cC'p0?016? Tlr ^[00001] Account .' ttlttlltO989 . ' .R/I$ s{0?40134 -' IteFos it

tr$

All,ilcnu ue crcdilcd rubjt,c{ to verificrtion, collcclior, rna co.dilili the Rul* rrrd Regulations of thii 6iink and et.orfu*isi providcd oy r8w, I'aym€nB sc ac.<ptcil when crcdk ls aplrlled lo oufsAndinn b tccs rnd not upon lssuan'ce of thls rcccipr Tnirsaaioiu'lcc.eivc<t aRcr thc Bank's pcicd cur{lf timc r Ser,rrdoy,'d,,nJri,._a Ur'"iii;f

uc datd rnd conJldccd rcc.civcd ac bfthc next busincst day. Pleasc rctsin this reaaipt urltil yo r€e lvc yorr dc{4uot gatcme{t, 05/0J/200d 09:24 0090169 Ttr 00006

rttftffr9Sl{ l$$uffo?8?

*5t000.00 *55 Capitalc,w^ DOMES J WIRE TRANSFER SLIP REGIONT l.lOU BRANCH\DEPT: HUMBLE. oFFICERT ^[2810] CUSTOMER REQUESTTNG TRANSFER: MANH THAI HOANG BALANCE PRIOR TO WIRE: $60,152,30

TITLE/ADDRESS:

MANH ]'HAI HOANG OR XE

PHONE NUMBERI AccouNT oN ANALYST$: I vrs fi NO ACCOUNT NUMBER TO DEBIT: ^[2040128177] ACCOUNT TYPEi uP FREE INTEREST cHEcKING AMOUNI OF WtREr $55,000.00

FEEI

$16,00 TMNSFER TO BANK: BANK OF AMERICA zlPl CITY: HUMBTE

STATE:

ROUTING NO: ^[111000025] BENEFICIARY BANK (tf appilcabte)r

ZIP:

CITYr

STATE;

ROUTiNc NO/ACCoUNT NOI

FOR

THE ACCOUNT OF; PHAI' VANNGUYE:N ------j

ADDRESS:

s00-3 cALptcoTE SI

ADDRES$;

ZIPI 77346 _ gtry; HUMBLE STATE; TX ACCOUNI NUMBER: 00s8633S3658

C0[IMENTSI

cUSToMER SIGNATURET

ID

VERIFIED AND WIRE PROCESSED BY:

VERIFICATION

OF CORPoMTEAUTHoRIZATIoN: fl Corporate Resoluflon ! Voctor 12

Checkone: :lLl?.lg_K 9TGNATURE FoR PHoNE uR FAX (fF AppLtCABLE)l (:F:Fii,3I5i8y^'" ACCEPTING N.O. WIRE CLERK:

%

REFERENCE#:

r %.

I

_s|!1:sfMl.-..-

TIME:

usER tD: 81rMl2 (4,b6) 39t05O CapitatOne, Natlonal Asgoclaflon, Momber FDIC *56 'Capitalottu D i rect .inqu to Customen Senvic:e i r i es (504) 533-53G1 on {800 ) 262-568s Ii4ANH THAI H0ANG 0R Need Money fon Col lege? NGOC DIEM THI VU Apply fon a Capltal One 6003 cAtDtcoTE ST Educatlon Loan. HUMBLE TX ?7346-2775 Capl ta lonobant(. corn NonnnI cnedl t quallflcatlons apply,

fr+.+-.r:\ + s credits,/deposrts Eqo, rss,el ii;iilEfl :i;i: :ffil Pnevior:s Ualance

23,231.89 Statsnent cycte began Apr I I 14, - ^ofiiJ li: iBBt 11 Debi ts/checks $so,oii.gi Nuntrer ot days in cycre - senvice charges $0 ' 00 28 Minirnrn oa tance'th{s cycle

paid

$3.65 Avenage correcieo balance g 4 ,632,97 lncing tj?ff::tt oe $12'773,61 Inter6st earneo auring this cycle $s,6s $1e,0 r4.rz /.,,,t,, Annual pei"centage yieiU *umed Interest patd yTD 0,25%

$Z,Sl uescrlptlon ?ulu 91/,?! $go,gsl.zl custcrnen deposit eila-No. y1/,1? ^[04] /25 $ t nnrr qn g:4gg $s,zoo.oo a;iil;. i&r,, $ ^[1] ,004 .20 Cus tonm depos r t ,^ + ^^--- -,- .

^, 05/ 1I $3.6s i"i"..ri J.'!o re Da te No, Anpun Da te No, Date' Anrotrnt 04/24 tvl No. t $500 .00 I oslr I I ostoz 20t $47. ^[13] 04/20 200* 203 l a5/04 $62 .4 ^[1] $176.s6 | 05/05 202 $3s3.00 205* $59 .80 Da te Arrount Descr lpt lon a4/ ^[17] Payment to loan nunben $307. e0 04/ 18 ^[1] 17700 1469 ^[10] $51.24 ACH l(i thdrar+a I CINGULAR CARE CELLULAR 04/28 Wire transfel,wi thdlawa I $55 , 000 .00 WIRE 516ADOO 04/28 li/i re t nansf tir f ee $ 15 .00 |,/IRE 5 I6ADOO 05/05 $5,00 Plus Pad<age Dues Da te Ba lance te 04/ t3 8a I ance te $23,231.89 ^[1] ance

Q4/24

04/17 $59, 149. ^[10] 05/a4 $4,697. ^{[1] [7]} $22 , 923 ,99 04 / 2ti 04/ 18 $60, 152.30 05/05 $22,872,75 $4 ,632. 37 04/2t) $5,137.30 04 /20 05/08 $22 ,696. sg $12,832,37

05/0,,L

$5 ,090 , t7 05/11 $ 12 , 273.6 ^[1] - over Menben FDii *57 , c .-''i fpirprrt Stut"*unf*- $'. .Settf gi rp r,t $kfern a n t "H,ffim$,ffi,&b O*{B t{o. 2f02420s fl -F f. U Ft-{A z. trrmil o. ! conv. unill 4. I v+ s, [.corrv; rns. lnsurance-GG t.tOta' :@ 1'ri,

ttcrns r(osa;.|trdultdet GA 3,7gg nd]4 NSo Etr,c Willtame noii,"iloutUe, oA gtr6s ., v..uvrtsfr{\., n(,lrREss oF '. tUtYgAttE lllply" ilr.rtlame Rd. . p. o. BsxoilSl, Aiiaswae,.M Jtfiha ;.pnoffi uocnirorr fr##:{U"rf;;{ I ffiiimT- " :.':'Tl.'S '-.i:' n o,*ox 4tr/lifiaunry+.rgditr fi: j'. r .,. :-.'. . . . .:1 .-. : sEnuurrurEffi lo serIEE r. souane"scruGGffi {

OJUSTUENTS.*

$ry's. b

ADJUSTMSNTS TO , 7. Counti, Ta<sr {00. C+stowrr Taxor l. aqg*snenE b 97! 190, ooo- oo trunuoumrotE.-rr-ffiIlH: t"Un srqbd; $noo.96 25s,soe, g2 LsrMErvrse@ )itirloffi bx€s

b a(F|vh)(ds 9751. 04 *58 .e1s 510.

zlu 2fr,TOTAL PA'D BY/FOR s7 ,255. 939 , 86

EORROWER:

IN AMOUNT DUE TO SELLER: 301. Gfilsl arnount due frorn boncruor (tne 120) $7,573,110.60 601. Gross arnounl duo to sellof $1 r ^[490] .0O0 , 00 302 Lnss amount pald by/for bonorrrer (tlne 220) 67t255.939.86 . l+ss redudJons ln aml due selhr {lno 520) 1r.202t757,O 303' cAsll t firnoul t I rot BoRRovlrER: cAsH tIrnor'.r) tfiro1 sELLER:

€231 ,959 , ^[71] HUD"I (3.86) - RESPA, HB 4:105.2 FAGE ^[1] *59 ,A,' S etitetr e nt'StaGilen t U,S. Depsrlfid.rl ot Fheln o Jm6 0m ufbsfl qowbp,ner{ .p$\ -ll- !!!B No, a6o2{28s ll 1. I FilA 1. fi v,l s, I conv. rns.

Case NuinGl 410 En"zE Wnans Road, Moulblo, OA Btf6g .. ^[110] Erw Wlilams Road, lioulfiE, OA ll1iI NAME AND ADSMSFTEilEEil s000 southltitb bpiii tou, Jackonvlue, FL AIZ6A LOCATlO.ll frto,ude, AA UT6g oATE: AWTAAA

RESCISSIONDATE;

I Conbact_Srt€r ftico , t. s€t{tdne"tr dur0os-tom

tno seiLe.r., g Il{aFG;TEil; ' !t ptcpalz!€ut panal. t1. IOJUSTMENT$FORrrE@ €30,696 . no t- -q, Cftplan b.ves

AD

h I {0O Q0nolrn Taxes lo

I

-

REOUCNONSIN@

Depocn oreemeel on1offil of nefl lsken suOlod b $570, o0 alqpmt of loen --- 97. Llt , ^[636] . 55

i395,76s . 96 oraer Flnan&;; '------]] %

JUSTMENTSFO@ $23o,0',00. o0 c{tyltoyrn t8ro3 to uounb,|axos o3./t Aesgsenrent-f Ir) - *60 20. TOTAL PAIO BY/FOR 520. TOTAL REDUCTIONS $1t805t1107.33 BORROWER: INAMOUNTDUETO SELLER: lO1. Gross amountdue frorn borrcnnor (line 120) $2,03A ,o00 , ^[00] lo seller . Gross €rnountduo t02. [pEs amount psld byrftr bonovrnr (tirir 220) $7,405,do7.33 Less rddudlone tn srnl, due eellor (llne 520)

97,7t7.1t06, lo3'cASH t firnou) r flrot soRRowER 603.CASH t Irnou) t fl[ro) SELLER: $22a t892.6? $3t3,149,72 HUD-I (3{6). RESP& HB 4305.2 PAGE ^[1] *61 ut. oEe4q'6rc.1 of ttou(|{Hc a uns^H oct/ELopr,€{r |.,LEI,|ENTSTATEI\,IEf{T lr. Hotilcro€ s{s cAsE }ilffi ln F. l{^ttEAtO

FiBF'V, fio{r}ao &rdrffg htrg T, Vu FldFh{rdd8!.* ,ndy ltgo Sll2 Coot Rord P,O.8oxt76{ Corri( tsxat ff$l

El Oor8do, AR ^[11] 13't o. PROftfrrYrco\rcir; tt sern*em ffi-J6{o€6{8i} gtl?CootRond noo",t;d,6,r.-. '' .: C$\i{(TXz8yt .1, fon fituckotoy,,Uonrcyd td#, p,C.

Pf.,rC8.OF6ETT|"I 4EHT 14& ffro t Alrttd Ccrpsny ll{ eUo{0rnS{!.t F.r.r|&LT.16| ftSg6

f ?{. cfrGss rrro0r\rro{a FRb${ SORn0 6ER GRO$S nffq/RT o{lE ro sfLLEfi 610. lOTtlL REtxfrftOfi,{t{O{AlTOUESEtJ.gR yl]lly( r{ior,{r( ror0ofiRowsR TnJ { fRoM) sErlfR *62 I vr hltE:{ l:Elrthrt t '% g..fisd to bo I tft|o coiry. W,ffiffiR,onEiiGw,Eb. - (oa€co€Aro.{co{r^l r, *63 QtriB "O,2s02.0266 S. oEilARIMEIT oF HoUsINo E URsA}t DEVET0PMENT

SEITLEMENT

STATEMENT 8. MoRTGAGE INS.ASEIIMBM NOTE: DriS a.T! ls i.,?ys/ro.d b rensnedied IPQCJ'were paUoultttune*:sni;iitt'lii'iiil"ire whtonnottondputp'scs jNqN norrdrd*,,uts ratqt'. . NAME etonsss or goRROt/ER t.0 €, NAME ANo ADoneSs6EFr_r_srr F. NAITE At{D ADDRES8 OF Li.NDER; dlt.Phu, klc ffi:xTfrff'ff#i?ffitx,1"$tr+ FlItl Flfisndsl 66nk uc T, Phan 8nd ufo, Anh T. Ngrryon P,O.8ox {764 orl|0 T, Phdn

Dung T, Vu ond Andy Ngo ls7 cR ^[127] El Dorado. AR ^{[21731] [8312]} Cooks Rd, aldwefi l6ya5 ^[7636] Calvorl, Texse 71836 . pnomnryLoc,qrroil: IJ.STTTLEMENTAGENT: ?5.?065483 ,12 Coolr Rd, I. SEmEMENT OATE: J. Kon Muc*okry Aflor$oy Bl Lsrv, p,C. otyorl, TX ?7838 oberlson Courily,T6xsc

Novdmb€r 16,20,10 PTACE OF SETILEIIENT Lovo n0o &Abstrdd ffiffiffiY

'

^[114] g, Morgan Slr€ot Flankiln, Toxoo r/85B

I

GROSS.Ai,tourft o uE I:ROtt B2RROIWR 420. (iRos.s AMOUfli" DUE ro sEr,-€R TOTAL PND BylFOn BORROII,ER 62!; T(tfAL REOUCIIOTV AI{OU /TOUE SFI(ER cAsH( X FROH ) ( TO ) EORR}fiER N3. cAsH:( .TO)( FROM)iFL,ER *64 8. TYpg s. oepnRTtr€ut6i flousfiro t unsA]t DEveLopMENi . SETTLEMENTSTATEMEMT l!!: ton t! tu.!l:F!Lo sruu ru ll'Ers nrctucd 'lPocf wom pald oulstda tho dosll: tlrsy oi sno,vi nn fu namathnat putposas aN src nol h};tut,/gd h ap bbrr.

. NAMEANO NA,VI6 AND AOORESS Of F. NAA{SAffDADORESSOF noeol T. Phsfit end hi(o, oo*trrt(orm ErcIsrRo Co{Dprny, qusllflod Flr!l flnNftcjsl Book rsr€la H. PhBm l0l0rmedlBry tor Phap V. N0rr),tn 8rd wtto, P,O. tlox ^[1751] iO3 Mo{(rns Rtdgo Ct OJng T, Vu s.dArdy N9o ElOr''ndo,AR 7173| 0uslor, r€xa3 71041€239 ^[0312] Coo*f Rosd Celv€rl, Toxas 71037

. PROFERTYLOCATION: SCTTTEMENTASEVN 25.2606483 ItE Cookr Rold I. $ETTIEMENTOATE: Bfvorl, fi ^{[77] [837]} J. Kon Msc*okoy, Atto{noy dl Lsw, p.C. Decombof 17.2010 obertson County, Toxor

ruACE OT SEfiLEMET{T Lovo Tltlo t Abrtrcct Conparry ^[1] l{ E. Morgen Skcol, FlFr*Un. Tox88 77dS6

a. ^[1] IO, CROSSAMOUNT DUE FROM AORROly|lr,R

{30. cnos$A {ouNTDUe rOs&((.EF I J'r' Lc,zt"z1 Jtzrt'tcrtal O,, TOTAL FAID BY/FOR 8ORRO91€I3 620. TOTAL REOUCTION AHOW\ OIJE SELLER l. I, c4SHr X FROH)( TO)BORR}WER ^[603] cr,A,sHf Tol( Fftott)SELLER *65 !.SF]-T!E4ENT GHARGES .-@_ ' ITEMS PAYAI]LE IN pg' - Rollo.aot g ztl,M ,s*np.f.taf+i@ 0a rl, l@ r.tr ttrl+Tfl

J.

SstlkifiarntAgeni rlllod lo bo s truo copy. ( {o.ocoo il roacog t , ?7 ) *66 \lAL DISBURSEMENTS EXHIBIT . Borrowoft Vincent T. pham end w{fo, Therosa ll, pham 6ollsn fnqp.y. Nguyon and wifo, Dung T. Vu Andy Ngo

Londer: First Flnanclel Bank Seillemont Agerrtl J. Kenlvluckelroy, At(ornoy at Law, p,C, (930)276.2304 Plsc6 of Seflomonti !9yo_n!.e & Abstract Company ^[114] E, Morgan Street, Frankllri, Texas ZZ860

Sottlolnsnt Dato: Uecember 17,2a1O Property Locatlon: 8918 Cooks Road Calverl, TXtTggl Rob€rlson County, Texas

Escrow for MH property Taxes 2,000,00 Doy.ntl:ql flc hange Co m pa ny 2,389,242.52 trxcnang0 Qredlls Tolal Addltlonal Dlsbureemontg shown on Llno l3p6 $ *-e[9]'34?pa (1 OOC001 "PFD/l GOC0O t|21 ) *67 .t V7'7*- 2'FzQ /azz " ) *74oed*7 \ i- - -/ -, Fa--*/ .7F-7,@e.#++ nr&'/h,42-./ Far /rr"rV u{-e-

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Form 4562 (2010) *80 ROBArr.f B. ITHAM & ASSOC-ATES, P.C. Attorneys and. Cclunrclors at La'iv ^[9999] Bellalrc Blvd,, Suire # I122 Tel: (?f 3) 7'16-33J3 Hous(orr, 'l'exas 71036 Irax: (? l3) '176-3335 rsbcd$sD@pdsdd

Junc 30,201 ^[1] YIA CERTIFIED MAIL, Rzur ?OO4 25IO O(}OO 6496 I4SIAND REGULAR MAIL Phat V. Nguycn Dung T. Vu l8722Timber'I'wisr Humblg Tsxas 77346 Rer

our clients: Manh lloang & Dung l,e Dear Mr. Nguycn and Ms, Vu: Plcaso be advised that I am rcpresenting the above-mentioned clicnts regarding thoir partnerships in your

-,- --o'--.----Q farms in Texas and Georgia I have roviewed your profit.sharing calculations (see attached Bxhibit A) and apparontly, per my clients, it does not rcflect the true division oi in"ome fl-tl':^iiT", ploase accept this lctter a,s a formal denrand for additional $250,000 per Mr. I{oang and $250,000.00 for Ms. Le. If I do not recoive tho said $500,000.00 for my olicnts as.of July 31, 2011, I will file a lawsuit against you and will ask for attimey fees. Ifyou have any questions, please contact nre at the addross listed above, Sinccrelv ,./ 7r//

./// ,/ / /^'4/{*l-...-- Robert Pham Attorney at Law

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*81 RO,BN T B. ]3HAM & ASSOC I,'TES, P-C. A;ttoflreys And Counselore at La\y 99V) Dellafue Blvd., Sufte #l I22 Tcl: (713)77G3333 Houston, Tcxas ?7036 Fax: (713) 776.3335 rclcqdiam@pds,lcl

Jme 30,201I WA CEITTIFIED MAIL, RRR 7OO4 2510 OOOO 6496 94?4 AND REGULAI{ MAIL Andy Ngo I8722 Timber Trvist Humble, iexa,s 7ii4d Re: Our Clicnts:

Manh Hoang & Dung Le Dear Mr. Ngo; Pleasc be advised that I anr ropresenting the above-mentioned clients regarding their partnerships in your fanns in T'exas and Georgia. I have rovierued vour pro.fit.sharing calculations (see attaohed Exhibit A) and apparontly, per nly clients, it docs not reflect t-hc true division oiin*nrc At this time. olease a&ept this retter as a fo,,nar domand for arlditio.ar $2i0,000 per Mr, Hoang and

' rvrrrrqr uvr'rurru tul i $250,000.00'for Ms. Lc. If I do not receive the said $500,000.00 for my clicnts as of July 3r,201r, t witt file a lawsuit against you Sirrcerolv "W and rvill ask for attomcy fees. If yo, havc any questiorrs, prease contacrr rne at tho address listed atrovo. Robcrt Phanr Attor:rey at Law

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& F€ €s *82 CAUSE NO. 2A11.72"1L9 cl-v 0.00 RECE],I]T NO. 1-3801.

TR#72830822-

09-28-2012 - In The ssLh PIJAINTIFF: HOANG, MANTI .rudlcial oistrict Court of Harris County' T'cxas

DEFENDANT: NGUYEN' PHAP V 55TTI D:I:STRICT COURT HousLon' TX

CITATION

THE STATE OI.' TEXAS County of Harris TOr NGUYEN, PLIAP V

832 COUNTY ROAD 4849 TIMPSON \X'159'15 ALLaclred ,i.s a copy of pLATNTIFF'S-QBI-C:IIA!-!E'IM9N

,I.his lnstrunent was fi.l.ed on tlre 28th-d4y of ,9ept-elrnber, 201'2, in Lhe above clted cause nunilcer and. cour:h. The insLrument, abtached describes t-he claint against' you'

If you ol: your aLtol:ney do noL' fite a YOU HAVE BEEN SUED, You may employ an attorney' writ-Len ansvier wil.h t-he DisLricL clerk riho,issued this citati,on by 10r00 a'm' on t-he Monday next foLlowiDg i-he explration of 20 days after you were served this cibaLion and peL-'i'tion' a defaulL ju<lgment ntay be taken againsl- you' TO OFFTCER SERVING:

3rd oiay of ocf,ober, 2aL2t ullcler: my hand and This citalion r'ras issued on seal of said Court- ' .Issued at request NC}UYEN, TRAN BAO 11045 LANDSWAIJK DR103 HOUSI'ON, TX ?'/099 Tel: (B32) 725-t49L Bar No. z 2404384'7

OFFICIIR/AI'THOR],ZED PI'RSON RETURN o'clock - -- .M', on t-he day of Cane Lo hand at tn Ilxecuted at- (address ) day of _- .- .M,, On Lhe o'clock County at -l -. defendant, in Person, a , by delivering to coPY(ies) of Lhe t-rue copy of bhis citation bogeLirer vtith the accompanylllg PeLiLj'on date of crelivery. the cit-aLion Lhe attackred Lherebo ahct I endorsed otl said copy of day of To certi.fy which r affix nty hand official-ly tlris Feer $ CounLY, Texas

of *83 U no ff i c i a l  C op y  O ff i c e  o f C h r i s  D an i e l  D i s t r i c t C l e r k *84 U no ff i c i a l  C op y  O ff i c e  o f C h r i s  D an i e l  D i s t r i c t C l e r k *85 U no ff i c i a l  C op y  O ff i c e  o f C h r i s  D an i e l  D i s t r i c t C l e r k *86 U no ff i c i a l  C op y  O ff i c e  o f C h r i s  D an i e l  D i s t r i c t C l e r k *87 U no ff i c i a l  C op y  O ff i c e  o f C h r i s  D an i e l  D i s t r i c t C l e r k *88 U no ff i c i a l  C op y  O ff i c e  o f C h r i s  D an i e l  D i s t r i c t C l e r k *89 U no ff i c i a l  C op y  O ff i c e  o f C h r i s  D an i e l  D i s t r i c t C l e r k *90 U no ff i c i a l  C op y  O ff i c e  o f C h r i s  D an i e l  D i s t r i c t C l e r k *91 U no ff i c i a l  C op y  O ff i c e  o f C h r i s  D an i e l  D i s t r i c t C l e r k *92 U no ff i c i a l  C op y  O ff i c e  o f C h r i s  D an i e l  D i s t r i c t C l e r k *93 U no ff i c i a l  C op y  O ff i c e  o f C h r i s  D an i e l  D i s t r i c t C l e r k *94 U no ff i c i a l  C op y  O ff i c e  o f C h r i s  D an i e l  D i s t r i c t C l e r k *95 U no ff i c i a l  C op y  O ff i c e  o f C h r i s  D an i e l  D i s t r i c t C l e r k *96 U no ff i c i a l  C op y  O ff i c e  o f C h r i s  D an i e l  D i s t r i c t C l e r k *97 U no ff i c i a l  C op y  O ff i c e  o f C h r i s  D an i e l  D i s t r i c t C l e r k *98 U no ff i c i a l  C op y  O ff i c e  o f C h r i s  D an i e l  D i s t r i c t C l e r k *99 U no ff i c i a l  C op y  O ff i c e  o f C h r i s  D an i e l  D i s t r i c t C l e r k *100 U no ff i c i a l  C op y  O ff i c e  o f C h r i s  D an i e l  D i s t r i c t C l e r k *101 U no ff i c i a l  C op y  O ff i c e  o f C h r i s  D an i e l  D i s t r i c t C l e r k *102 U no ff i c i a l  C op y  O ff i c e  o f C h r i s  D an i e l  D i s t r i c t C l e r k *103 U no ff i c i a l  C op y  O ff i c e  o f C h r i s  D an i e l  D i s t r i c t C l e r k *104 U no ff i c i a l  C op y  O ff i c e  o f C h r i s  D an i e l  D i s t r i c t C l e r k *105 U no ff i c i a l  C op y  O ff i c e  o f C h r i s  D an i e l  D i s t r i c t C l e r k *106 U no ff i c i a l  C op y  O ff i c e  o f C h r i s  D an i e l  D i s t r i c t C l e r k *107 U no ff i c i a l  C op y  O ff i c e  o f C h r i s  D an i e l  D i s t r i c t C l e r k *108 U no ff i c i a l  C op y  O ff i c e  o f C h r i s  D an i e l  D i s t r i c t C l e r k

1/23/2015 12:40:43 PM

*109 Chris Daniel - District Clerk Harris County Envelope No. 3878020 By: DANIEL FLORES Filed: 1/23/2015 12:40:43 PM NO. 2011-721t9 MANH HOANG and $ rN THEI DISTR]CT COURT DTING LE 9F VS.

TI/\RRIS COTINTY. TEXAS

PHAP V.

NGUYEN, U no ff i c i a l  C op y  O ff i c e  o f C h r i s  D an i e l  D i s t r i c t C l e r k ANDY NGO and DI]NG T. VU

55TH JUDICIAL DISTITICT

TNGJEBDIEI,

TO PROPOSED FINAL JTIDGMEI{T TO THE HONORABLE JUDGE OF SAID COURT: Now coME PHAP v. NGUYEN, ANDY NGo and DUNG T. vu, hereinafter as "Defendants," and file the these combined motions objecting to the proposed lFinal udgment presented by MANH HOANG and DUNG LE, hereinaften.refemed to as "Plaintiffs".

lbndarrts request that the court disregardjury findingsl and request ther entry of a judgrnent notwi ing t1[re verdict of the jury as to all defendants, all as set out hereitr. In support, they show rcouft as follows: 1. ATTORNEY'S FEES ON APPEAL CANNOT B]O AWARDED BECAUSE THERE IS NO FINDING BY THE JIJRY AND NO

EVIDBNCE TO SUPPORT AN AWAIID O]F fiUCH FEES The proposed judgment ten<lered to the court awards the followine relief: IT IS FURTHER Ozu)ERIlD, ADJUDGIID, and DECREED thar plai MANH HOANG and DUNG'I. LE recover from DrefenclarLts, pHAp V. NGU , ANDYNGO, andDIINGT. VlJanamountof $15,0011.00 i:nattorney's fees inthe e n t of an appeal to the Court of Appeals and Plaintiffs prevail on said appeal, an additi $10,000.00 in attomey's fees in the event a petition for review is filed in the T X

AS

Supreme Court, and an additional $15,000.00 in attorney's files in the event revie is granted by the Texas Supreme Court and Plaintiffs prevail on said appeal. *110 There was no evidence offered atlu'ial as to any attorney's fees on any clairn by

aintiftrs, either for trial preparation,trial, or for appeal. Any award by the trial. court of attomey's fi would amount to a finding by the trial court as to reasonable and necetisary attorney's fees, w thout the benefit of evidence of any of the factors set out as relevant by the ToXas Supreme Court in Arthur Anderson & co. v. Peny Equipment corp.,945 s.w.2d 81j2, (Tex. lg97\. Proof of attomeys fees requires some type of basic prool; such as the itemizatidn of what Dvr vrvvD a taw yvr lrgrrururetl, ure urne requrec rc perlolm tnem, and that tlte rate applied to the tirne services a lawyer performed, the tirne required to perform l;hem, and that t6e rate applied {o the tirne required is reasonable. Even generalized statements as to ar reasonable fee are noi-suffi.Jie nt. Citv ofLaredov.Montano,414S.W.3d73I,73ti-737(Tex.2011)). Therre.krre,thetrialcourtcafir,otmake a finding that the jury was required to make, and there is no evidence to sgpport anv find]ing.

U no ff i c i a l  C op y  O ff i c e  o f C h r i s  D an i e l  D i s t r i c t C l e r k No attomey's fees are recoverable in this case. 2. THERE IS NO EVIDENCE OF A I}IREACIIIOF ANY CONTRACT'BY DI] VU WITH PLAINIIIIIFS AND

THE COURT SHOULD DISREGARD T'HE JIURY FINDING THAT SHE "BREACHIDD THE PARTIES' AGREEMENT''

In order for the jury to find that defendant Dung Vu breached any contract with ttrd plaintiffs there must exist proof of a valid contract between them, a breach by her of some term or prrovisi,rn ofthat agreement, some evidence of injury, and proof of darnages arising from that injury. ptuthwel v University of the Incarnate Word,974 S.W.2d 351,3:t4-355 (l'ex. App.- San Antofrio 199g, pet.den.); Meadv. JohnsonGroup,6l5 S.W.2d 695,697 (llex. l9g1).

The evidence in this case shows Dung Vu's involvernent 1;o r>nly a very lirnited e{te,nt. Slhe joined the other defendants in applying for and securing finiencinlg to purchase bpth of tde chickrn farms involved in this case. She executed clocuments to sell each of the two farms. She li.{red on the farm in Georgia, traveling back anLd .forth to New Orleans to eiarn inco.me to support her fan{il'y. None of those acts form the basis for arLy of the plaintiffs' breach of contra.ct claims; in fact, th{ plaintilfs benefitted from those acts.

There is no evidence that Dung Vu made any decisic,n as to omployment of and phyment to any of the participants nor made decisions regarding the nLanagernent of the faims. The! evidence shows, and is uncontradicted, that the decision to charge connpensation for services (20% of profits from the farm sales) was made by Andy Ngo; that the calculaticns of capitaX gains rfa;<es a'd withholding of them from a distriburtion to the partners was made b,y r\ndy l{go; that the caic,ulations of depreciation and recapture of depreciation was made by Andy lolgo; that the decisioh to defbr payment of capital gains taxes was rnade by Andy Ngo, with the assent of Phap Nelur.en: the calculation of the amounts due each pafticipant was made b),,\ndy N6;o; and the distrituti"hlf n n,t, to the participants was made by Andy Ngo.

*111 A wife is not automaticalty liable fur obligations incurred. b.y her husband. Texhs Family Code $ ^[3] .20I(a) provides that aspouse is liable for the acts of his or her spouse only if the s$ouse acts as the agent for the other or the debt is for "necessaries." Therre is no evidence that the dedt r;laimed by the plaintiffs was created because "necessaries" were pro'vided t9 t6e family. There is nf evidenoe that defendant Phap Nguyen was acting as an agent for Dung Vu. Slhe executed any necebsarv lesal documents to buy and sell the chicken farms herself.

The Family Code $ 3.20I(c) explicitly states thatastr)ouse is not automatically corlsidered an agent because of the mamiage relationship. Therefore, sornr3 eviilence of an agency-agre{nrent was required: there is none in this case. Plaintiffs could have arsked JDung Vu what tr"t.tJt. was, w6at decisions she made, if she was consulted, etc. but did not do so. As a result, the trial record is dev'id

U no ff i c i a l  C op y  O ff i c e  o f C h r i s  D an i e l  D i s t r i c t C l e r k of any evidence that she committedlany act or omission thal;caused injury to the plaintiffs. Thus, there is no evidence to supporl the answer of the jurlr to Questions No. 2 urrd 5 thut Dg Vu breached any contract or agreement with the plaintiffs zurd the court should disregard those juLry findings.

3. THERE IS NO EVIDENCE OF ANY BREACIT OIF'CONTRAC'T BETWEEN THE PAITTIES BY PHAP NGIUYEN A]\D THE COURT

SHOULD DISREGARD THE JURY FINDING

TTIA'I HE BREACHED THE PARTIE}S' AGIIEEMENT WI]IH P]L/,INTIFFS There is no real conflict in the testirnLony of the partiesito this suit as to what was ag when they first agreed to pool money to purchase a chicken faim in Geo.rgia. llt is uncontestr that tlhe parties agreed to invest funds anrl to receive a share of the profits fiom operations and r le of the faim. It is uncontested that the parties agreed againto build a flLrm in Texas and share profits in proportion to their investments but tlhere is a complete llack of'proof of any 6ther s ofan agreement. The central issue in this case is what, if anything, was ilgreed between the res as to payment of any compensation to Andy Ngo and Phap Nguyern for throir assumption of lial ility, loss of earnings, full-time devotion to the chicken farms, labor, an.d serrrices. Plaintiffs assume th.ere was an agreement not to be paid for those services. The evidencti is that there was never any ment that Ngo and Nguyen would not be paid. No witness ev,er testifiied that Neo and N lren, the defendants ever represented at any time, that they would wo;rk for frr:e. Therefore, any fi ing that they breached a contract by paying themselLves 20o/o of profits is siuprportecl by no eviden at all. There is no assumption that a party who provides valuable services will without compensation. In fact, the assumption is that unless there is €m expreiss agreement forr com that valuable seruices will be compensated" Grynberg v. ,Gwaltn'qt, l9g3 Tex. App. L

)ts 44(i7 *112 (Tex.App.-Ft' Worth l983,nowritJrist.); BlackLake Pipe Line Companyv. (JnionConstr tion,538 S.W.2d 80 (Tex.1976). Since Plaintiffs failed to prove the existence of any express ragreement that lDefi ts Ngo and Nguyen would work and provi<le services without compensation and, such an agree rrt camot be implied, there is no evidence that a demand to be pai,l is a. breach of any contrar with the plaintiffs. Therefore, the court shoulcl disregard the answ'r of the j,ury to euesiions No. and 5. Again, the question is whLat did the parties agree to. A tax liability for either ca1 U no ff i c i a l  C op y  O ff i c e  o f C h r i s  D an i e l  D i s t r i c t C l e r k

I gairrs

or ordinary income is created by the laws o1 the United States of America. There is no ev that any of the defendants ever representecl to any of the parlicipants that any profit they reali would be tax-free' It cannot be a breach of a contract to insist on complying with the naws of United States of America. In fact, it would be against public policy for pinii"s to agree to not rltaxable income. Plaintiffs asked questions and attempted to raise doubt aboul any terx liability throirelh cross- examination of defendant Ngo arrd Defendant's accounting,expert, Iylike llalls, but neithdr of those witnesses testified that there would be no tax liability. And tJhe jury cannot find no tax liabf;tv UuruA solely on the skepticism of the plaintiffs: thLere must be sorn,; testimony by one competenlt to testifl, that there would be in fact no such tax liabiility.

Therefore, the actions of defendants Ngo and Nguye,n in rvithholding frorn any d{stributipn of profits the amounts of expected federal rtaxes neither breaches neither un uir*[or.rrt,no. "rprrru any implied agreement. The court should disregard the ansurer of thr; jury to euestionr Nb. Z ancl 5 and enter judgment that the plaintiffs take nothing on their c,laim for breach oicontract.

Dung Le also complains that the Defendants breachLed their contract with her paying a portion of the distribution of profits to her former boyfriend and brottLer of Andy Ngo. Tl cluestion is, where is the evidence that any of the defendants agreed to pay any distribution 6f profi solely to her? The evidence at trial is unc<lntested that the initial conversarlions regarding inr lng were between Andy Ngo and his brother; that she and her boyfriend joinlly marJe the 1nvest : that a prior distribution of profits was divided between Dung Le iand the brother; and that the brother's paycheck from working on the chicken farm was sent to Drung l-e. There is no evi

of arry express agreement that Dung Le would only be paid any arnount clisriributed. The only e idlence of an agreement shows one between Andy Ngo and his brother. llhere is no evidence t|at the i vestment was hers alone, other than a check dlawn on her account, but ilrat chqck was drawn wXren s and her boyfriend were living together and apparently sharing their incorne; and after they had re ted that they were investing together. *113 There is no evidence frorn whiah the jury could havr: found that withholcling from a distribution to the participants for federal capital gain and ordlinary income taxes was a of the agreement between the parties, that payment of compensrrtion to defendants Ngo )t{guyen breached any agreement, and that dividing the division ofprofits betrveen Dung Le and her boyfriend was a breach.. Therefore, the court should disregard the jr"uy's ans\ver to euestions No. 2and5as to Phap V. Nguyen and should enter judgment denying any recoverrF against him orr that gr:ound, 4. THERE IS NO EVIDENCE OF ANY BREACET OF'CONTRACT BETWEEN THE PARTIE]S BY ANDY NGO ANID THIX COUR'T U no ff i c i a l  C op y  O ff i c e  o f C h r i s  D an i e l  D i s t r i c t C l e r k

SHOULD DISREGARD THE JURY F'INDING TBTAT HE BREACHED THE PART'Itr],S' AGRB,BMENT WI'[H PLII,INTIFFS In support of the Motion the Defendants adopt the sarrLe staternLent of the evihence and argument as set out in Paragraph 3 above. The action ofDefendant}rtrgo inwithholdingpayment for compensation from any dislribution of profits for services provided or for the amounts of expected fei<ieral taxes neith"i bJ"r,"h", un C-- -^-.':^^^ .. f^-,- Lt^ ^ -,,, , . ^-^-,|l^l ^f ^.^fi+o express agreement nor any implied agreement. The court shrculd diriregard the answer of lhe iury to Questions No. 2 and 5 and enter.judgrnent that the plaintiffti take nc,thing on their claim fo1. Lr"uott ofcontract.

There is no evidence from which the jury could have firund rthaf payment for servi rendered and withholding funds from a distribution to the participanrts for fe,leral capital gain i ordinary lncome taxes was a breach of the agreement between the prarties, that payrment of compr ion to defendants Ngo and Nguyen breached any agreement, and that dividing the division profits between Dung Le and her boyfriend was a breach.. Therefore, the court should disregard tlLe jury's answer to Questions No. 2 and 5 as to Andy Ngo and shourkl enterr judgment denying any recovery against him on that ground. f,. THERE IS NO EVIDENCE OF THE IIXIS'IENCE OF A PARTNERSHIP BX]TWEEN THE PARTI]ES AND THT] COURT SHOULD DISREGARD THE PARTI{IORSIItrII FINDING The jury answered "yes" to Questtion No. 8, askirng about a partnersftip, as all the Defendants. In order for the court to disregard the jury finding of partnerstrip it must be r lished that there is no evidence of a partnelship. There is some evidence gffered by the plairrtiffs SuppO,rt a claim of a partnership, but the question is, as a matter of liaw, is thLat evirJence zrlone su ient to support a partnership finding? The elements to show existence of a parlnership are: *114 1. The right to receive a share of profits of the business; 2. Expression of intent to be partners; 3. Participation or right ito participate in control orlthe bgsiless; 4. Sharing or agreeing to share either losses of the business or liability to third 5. Contributing or agreeing to contribute money or property to the business.

Ingram v. Deere,288 S.W.3d 886 (Tex.2009). U no ff i c i a l  C op y  O ff i c e  o f C h r i s  D an i e l  D i s t r i c t C l e r k Defendants conceded that trial that the plaintiffs contributed money to the busin, ilnd each had a right to share in the profits of the business. Howe.ver, those factons alone do n support a f,rnding that apartnership existed.. .And there is no evidence of any of the other factors. There is no evidence that any of the parties ever refened to each other as partners. T'he court in Ingram noted that the best evidence of the intent of the parlies to be partners is found ir u'hat they wrote, both to each other and to others, how they held themserlves out to others, etc. In thi case there is no evidence that any of the parties ever held themselves o,ut to third parties as pantnel erxecuted any document as a"partner" witlL each other, or referred to themselves as partners in any or conespondence. To the contrary, the evidence shows thaLt the Defendants contracted

ith many third parties while representing they were the sole owners, r,vith the knowledge of the pl ntiffs. There is likewise no eviclence that the plaintiffs either parl"icipated in or had t right to participate in control of the business. 'Ihe court in Ingramnotedireverul *uy, in which t right to control would be manifested. It defines "control" as the riglrt to rnake executive deci Some examples of control would be: 1. Access to the books and records of the business: t"here is no evirjence that the Iaintiffb ever had access to the books and records. The court in .[n|yam sraid party rrot ha-ye control ifhe does not have access to the business, books. 2. The right to write checks onL the lbusiness checking accourrt: ther:e is

that the plaintiffs ever wrote a check over aperiod ofseveral years. 3. The right to make decisiions regarding the major property of the business, i.e.,

chicken houses. The decisions to purchase land, hire a contrarctor, culs into a grower,s c , selll each of the chicken farms, etc. were made solely by the defendants. 4. The right to hire and fire employr:es. The eviderLce shows no right to hire anc

r,e by the plaintiffs, and even shows that defendants Ngo and Nguyen..flrred,;plaintiff Hoar flom his job working in the chicken houses. Likewise, there is no evidence of any agreement to share losses or assume ljiabilir

to third *115 parties for liabilities of the business. The only evidence in this carse regarding sharing of losses is the testimony

tUanft lloang that he "would have shared 1n any loises.,, But is nLo _bV evidence that he ever offered to do so, was expected to do so, or that:he ever became co Itv bound in any way to pay any debt to a third party. Ingram says no one factor is determinative in the existerrce, of a partnership, bu given the evidence that there was no evidence of intent to be partne:rsr, no j oint management and c ntrol, and no agreement or obligation by the plaintiff's to assume lossers, the evidenceis simply ins fficient as a matter of law to support the jury answer to Question Nc,. 7, and the court should di regard the answer and enter judgment that fte plaintiffs take nothing a.s pafl;ners. 6. U no ff i c i a l  C op y  O ff i c e  o f C h r i s  D an i e l  D i s t r i c t C l e r k THERE IS NO EVIDIi,NCE OF'AN]' DAMTAGES THAT RESULTED FROM A BREACH OF A PAR:TNERSHIP

AGRE,EMENT BETWEEN'THE PA,R'TIES It is unclear whether the darnages found by the jury in resp,onse to ()uestion lrlo. 9 [nd l5 are the same as those found by the jury in their answer to Questiott l,lo, 3 and 6. What is c(ear is that Plaintiffs only evidence of any damages arising from any hreach of the alleged partnersh]ip ;", fij

- \ - / the 20%o of net profits deducted ernd (2) the amounts withhetd to pay federaiinct*. tu*"[. In order for the plaintiffs tto recover for breach of a duty as a partner they have to uiro* ,o.n" damages that resulted from the breach of the partnership agreement. PlairLtiffs offe:red nd evidence of the value of a business enterprise as a continuing business. They could not because thb bu;in;s; itself, a chicken farm, had been sold. No evidence exists o:f any goodwill. There is no p[rtn.trfrjo asset that was lost: all the assets were sold and the proceedls distrjbuted

The plaintiffs argued attrialthat the defendants had s,cme ilut'y to continue to stay ih business with them, to allow the plaintiffs to participate in any businesrs venture they might enter inq[ after the sale of the chicken farm. There is no such duty as a matter of'law. ,Sa,linas v. Riyan,q+S S.W.ZJ Zg6 (Tex.1997)

Plaintiffs offered the amounts of capital gain and or:d.inary income taxes with no Iculation of damages from any breach of a pertnership agreement upo,n wlichL the jury could find amount of damages other than the porlion of net profits paid to the defendants and capital gains withheld. Since there is no distinction between a breach of an "agreeme:nt" between the partie and the purported "partnership" between rthe parties, there is no legal basis for an avyard of damages for dissolution of the business or for any lost value of the businesrs. The court should disregard the jury answers to Questions 9)ald 15 and render ju matter of law that the plaintiffs take nothing on their claim fbr darnages for breach of a agreement.

*116 WHEREFORE, DEFENDANTS request that the Mtotion be GRANTED in all that a judgment be rendered that plaintiffs take nothing frorm their suit. R.espect ftrlly submitted, U no ff i c i a l  C op y  O ff i c e  o f C h r i s  D an i e l  D i s t r i c t C l e r k Stale Bar lrtro. 17238000 210 North Street NaoogdochLes, TX 75961 (e36) sse-1 1s8 FAX (936) ss9-00e9 ATTORN]DY F'OR DEF'END

CERTIFICATE OF SEEIreE I certify thatacopy oflhe foregoing document has been served on opposing co this 23'd day of January,2015,by facsimile and email. to-wit: Mr. Scott K. Bui Bui, Pham & Nhan, PLLC FAX (713) 783-0787 email : sbui@buinhanlaw. com

2/25/2015 2:25:01 PM

*117 Chris Daniel - District Clerk Harris County Envelope No. 4280986 By: Deandra Mosley Filed: 2/25/2015 2:25:01 PM NO. 201t-72719 $ MANH HOANG and IN THE DISTRICT COURT OF

DLING

LE

$ VS. HARzuS COUNTY, TEXAS PHAP V. NGUYEN,

U no ff i c i a l  C op y  O ff i c e  o f C h r i s  D an i e l  D i s t r i c t C l e r k ANDY NGO and $ DUNG T. VU 55'H JUUCIAL DISTRICT

MOTION FOR NEW TRIAL

TO THE

HONORABLE COURT: PHAP V. NGUYEN, ANDY NGO, and DTING T. VU, Defendants, move this Court to set aside the judgment rendered on January 27,2015, in the above styled and numbered case and to order a new trial, and in support of this motion show as follows:

L

INSUFFICIENT EVIDENCE OF ANY BREACH OF AGREEMENT BY DLING T. VU In order for the jury to find that defendant Dung T. Vu breached any contract with the plaintiffs there must exist proof of a valid contract between them, a breach by her of some term or provision of that agreement, some evidence of injury, and proof of damages arising from that injury. Southwell v. University of the Incarnate Word,974 5.W.2d351,354-355 (Tex.App.-San Antonio ^[1] 998, pet.den.); Mead v. Johnson Group, 6 ^[1] 5 S.W.2d 685, 687 (Tex. ^[1] 98 1).

The evidence in this case shows Dung T. Vu's involvement to only a very limited extent. She joined the other defendants in applying for and securing financing to purchase both of the *118 Page ^[1] Hoang vs. Nguyen Mtn New Trial chicken farms involved in this case. She executed documents to sell each of the two farms. She lived on the farm in Georgia, traveling back and forth to New Orleans to eam income to support her family. None of those acts form the basis for any of the plaintiffs' breach of contract claims; in fact, the plaintiffs benefitted from those acts.

U no ff i c i a l  C op y  O ff i c e  o f C h r i s  D an i e l  D i s t r i c t C l e r k There is insufficient evidence that Dung T. Vu made any decision as to employment of and payment to any of the participants nor made decisions regarding the management of the farms. The evidence shows, and is uncontradicted, that the decision to charge compensation for services (20% of profits from the farm sales) was made by Andy Ngo; that the calculations of capital gains taxes and withholding of them from a distribution to the partners was made by Andy Ngo; that the calculations of depreciation and recapture of depreciation was made by Andy Ngo; that the decision to defer payment of capital gains taxes was made by Andy Ngo, with the assent of Phap Nguyen; the calculation of the amounts due each participant was made by Andy Ngo; and the distribution of funds to the participants was made by AndyNgo. Therefore, there is insuffrcient evidence thatany act or omission by Dung T. Vu could constitute a breach of any agreement.

L.

INSUFFICIENT EVIDENCE TO SHOW THAT DUNG T. VU IS LIABLE FOR ACTS OR OMISSIONS OF

OTHER DEFENDANTS

A wife is not automatically liable for obligations incurred by her husband. Tnxes Fervnry CooB $ 3.201(a) provides that a spouse is liable for the acts of his or her spouse only if the spouse acts as the agent for the other or the debt is for "necessaries." There is insufficient evidence that the debt claimed by the plaintiffs was created because "necessaries" were provided to the family. There *119 Page2 Hoang vs. Nguyen Mtn New Trial is insufficient evidence that defendant Phap V. Nguyen was acting as an agent for Dung T. Vu.

The Texes Fevnv Conn $ 3.201(c) explicitly states that a spouse is not automatically considered an agent because of the mariage relationship. Therefore, some evidence of an agency agreement was required: there is none in this case. She executed any necessary legal documents to

U no ff i c i a l  C op y  O ff i c e  o f C h r i s  D an i e l  D i s t r i c t C l e r k buy and sell the chicken farms herself. The trial record is devoid of any evidence that she herself committed any act or omission that caused injury to the plaintiffs.

Thus, there is insufficient evidence to support the answer of the jury to Questions No. 2 and No. 5 that Dung T. Vu breached a contract or agreement with the plaintiffs. 3. INSUFFICIENT EVIDENCE OF ANY BREACH OF AGREEMENT BY ANDY NGO BY PAYMENT FOR SERVICES RENDERED There is no evidence that the parties ever agreed that defendant Andy Ngo would be or would not be compensated for his assumption of liability, loss of eamings, fuIl-time devotion to the chicken fatms, labor, and services. Plaintiffs assume there was an agreement not to be paid for those services due to that absence. But no evidence exists that the parties agreed that Ngo would not be paid for his assumption of debt and liability, time, and labor. There is no evidence that Ngo ever represented at any time that he would work for free. Therefore, the evidence is insufficient to show any breach of an agreement by his payment to himself for his services.

There is no assumption that a party who provides valuable services will work without compensation. In fact, the assumption is that unless there is an express agreement for compensation that valuable services will be compensated. Grynberg v. Gwaltney, 1983 Tex. App. LEXIS 4467 *120 Page ^[3] Hoang vs. Nguyen Mtn New Trial (Tex.App.-Ft. Worth 1983, no writ hist.); Black Lake Pipe Line Company v. Union Construction, 538 S.W.2d 80 (Tex. 1976).

Plaintiffs failed to prove by sufficient evidence the existence of any agreement that Defendant Ngo would work and provide services without compensation. Such an agreement cannot be implied. U no ff i c i a l  C op y  O ff i c e  o f C h r i s  D an i e l  D i s t r i c t C l e r k There is insufficient evidence that his payment to himself for services rendered is a breach of any contract with the plaintiffs.

4. INSUFFICIENT EVIDENCE OF ANY BREACH OF AGREEMENT BY ANDY NGO BY WITHHOLDING

FLINDS FOR PAYMENT OF TAXES A tax liability for either capital gains or ordinary income is created by the laws of the United States of America. There is no evidence that any of the defendants ever represented to any of the participants that any profit they realized would be tax-free. As a matter of law it cannot be a breach of a contract to insist on complying with the laws of the United States of America.

There is insuffrcient evidence that the actions of defendant Ngo in withholding from any distribution of profits the amounts of expected federal taxes breaches any express or implied agreement between the parties.

5. INSUFFICIENT EVIDENCE OF ANY BREACH OF AGREEMENT BY ANDY NGO BY PAYING PART

OF PROFITS TO TIEN NGO Dung Le asserted that the defendants breached their contract with her by paying a portion of the distribution of profits from the sale of the chicken farm(s) to Tien Ngo, her former boyfriend (and *121 Page 4 Hoang vs. Nguyen Mtn New Triai brother of Andy Ngo). The evidence is insufficient to show that defendant Atrdy Ngo ever agreed, either expressly or by implication, to pay her and her alone a portion of the profits from the sale of the chicken farm(s).

The evidence at trial is uncontested that the initial conversations regarding investing were U no ff i c i a l  C op y  O ff i c e  o f C h r i s  D an i e l  D i s t r i c t C l e r k between Andy Ngo and Tien Ngo; that Dung Le and Andy Ngo never had any discussions at all;thx Dung Le and TienNgo jointly made the investment; that aprior distribution of profits was divided between Dung Le and Tien Ngo; and that Tien Ngo's chicken farm paycheck ftom working on the chicken farm was sent to Dung Le.

There is insufficient evidence from which the jury could have found that dividing the funds distributed between Dung Le and Tien Ngo was a breach of any agreement. 6. INSUFFICIENT EVIDENCE OF ANY BREACH OF AGREEMENT BY PHAP V. NGUYEN BY PAYMENT FOR SERVICES RENDERED There is no evidence that the parties ever agreed that defendant Phap V. Nguyen would be or would not be compensated for his assumption of liability, loss of eamings, full-time devotion to the chicken farms, labor, and services. Plaintiffs assume there was an agreement not to be paid for those services due to that absence. But no evidence exists that the parties agreed that Nguyen would not be paid for his assumption of debt and liability, time, and labor. There is no evidence that Nguyen ever represented at any time that he would work for free. Therefore, the evidence is insufficient to show any breach of an agreement by his payment to himself for his services.

There is no assumption that a party who provides valuable services will work without *122 Page ^[5] Hoang vs. Nguyen Mtn New Trial compensation. In fact, the assumption is that unless there is an express agreement for compensation that valuable services will be compensated. Grynberg v. Gwaltney, 1983 Tex. App. LEXIS 4467 (Tex.App.-Ft. Worth 1983, no writ hist.); Black Lake Pipe Line Company v. (Jnion Construction, 538 S.W.2d 80 (Tex. 1916).

U no ff i c i a l  C op y  O ff i c e  o f C h r i s  D an i e l  D i s t r i c t C l e r k Plaintiffs failedto prove by suffrcient evidencethe existence ofany agreementthatDefendant Nguyen would work and provide services without compensation. Such an agreement cannot be implied. There is insuffrcient evidence thathis paymentto himself for services rendered is abreach of any contract with the plaintiffs.

7. INSUFFICIENT EVIDENCE OF ANY BREACH OF AGREEMENT BY PHAP V. NGUYEN BY WITHHOLDING FUNDS FOR PAYMENT OF TAXES A tax liability for either capital gains or ordinary income is created by the laws of the United States of America. There is no evidence that any of the defendants ever represented to any of the participants that any profit they realized would be tax-free. As a matter of law it cannot be a breach of a contract to insist on complying with the laws of the United States of America.

There is insufficient evidence that the actions of defendant Nguyen in withholding from any distribution of profits the amounts of expected federal taxes breaches any express or implied agreement between the parties. *123 Page ^[6] Hoang vs. Nguyen Mtn New Trial

8. INSUFFICIENT EVIDENCE OF ANY BREACH OF AGREEMENT BY PHAP V. NGUYEN BY PAYING

PART OF PROFITS TO TIEN NGO Dung Le asserled that the defendants breached their contract with her by paying a portion of U no ff i c i a l  C op y  O ff i c e  o f C h r i s  D an i e l  D i s t r i c t C l e r k the distribution ofprofits from the sale ofthe chicken farm(s) to TienNgo, her former boyfriend (and brother of Andy Ngo). The evidence is insufficient to show that defendant Phap V. Nguyen ever agreed, either expressly or by implication, to pay her and her alone a portion of the profits from the sale of the chicken farm(s).

The evidence at trial is uncontested that the initial conversations regarding investing were between Andy Ngo and Tien Ngo; that Dung Le and Phap V. Nguyen never had any discussion at aII;that Dung Le and Tien Ngo jointly made the investment; that a prior distribution of profits was divided between Dung Le and TienNgo; and that TienNgo's chicken farm paycheck from working on the chicken farm was sent to Dung Le.

There is insuffrcient evidence from which the jury could have found that dividing the funds distributed between Dung Le and Tien Ngo was a breach of any agreement. 9. INSUFFICIENT EVIDENCE TO ESTABLISH EXISTENCE OF A PARTNERSHIP BETWEEN THE PARTIES There is insufficient evidence to support the jury's answer to Question No. 8 finding the existence of a pattnership. The evidence offered by the plaintiffs to support a claim of a partnership is insufficient as a matter of law to support a partnership finding. *124 Page ^[7] Hoang vs. Nguyen Mtn New Trial

The elements to show existence of a partnership are: 1.

The right to receive a share of profits of the business; 2. Expression of intent to be partners; 3. Participation or right to participate in control of the business; U no ff i c i a l  C op y  O ff i c e  o f C h r i s  D an i e l  D i s t r i c t C l e r k

4.

Sharing or agreeing to share either losses of the business or liability to third parties; and

5. Contributing or agreeing to contribute money or property to the business. Ingram v. Deere,288 S.W.3d 886 (Tex. 2009). Defendants conceded attrial that the plaintiffs contributed money to the business and each had a right to share in the profits of the business. However, those factors alone do not support a finding that apartnership existed.

There is no evidence that any of the parties ever referred to each other as partners. The court rn Ingram noted that the best evidence of the intent of the parties to be partners is found in what they wtote, both to each other and to others, how they held themselves out to others, etc. In this case there is no evidence that any of the parties ever held themselves out to third parlies as partners, executed any document as a"partner," or referred to themselves as partners in any document or correspondence. To the contrary, the evidence shows that the defendants contracted with many third parties while representing they were the sole owners, with the knowledge of the plaintiffs.

There is likewise no evidence that the plaintiffs either participated in or had the right to participate in control of the business. The most important factors in determining the existence of a partnership are the sharing ofprofits and the control of the business. Big Easy Cajun Corp. v. Dallas *125 Galleria, Ltd.,293 S.W.3d 345 (Tex.App.-Dallas 2009, no writ hist.). The court in Ingram noted Page ^[8] Hoang vs. Nguyen Mtn New Trial several ways in which that right to control would be manifested. It defines "control" as the right to make executive decisions. Some examples of control would be:

1. Access to the books and records of the business: there is no evidence that the plaintiffs ever had access to the books and records. The court in Ingram said party does not have control ifhe does not have access to the business' books.

U no ff i c i a l  C op y  O ff i c e  o f C h r i s  D an i e l  D i s t r i c t C l e r k The right to write checks on the business checking account: there is no evidence that 2. the plaintiffs ever wrote a check over aperiod ofseveral years. a The right to make decisions regarding the major property of the business, i.e. the

J.

chicken houses. The decisions to purchase land, hire a contractor, cuts into a grower's contract, sell each of the chicken farms, etc., were made solely by the defendants.

4. The right to hire and fire employees. The evidence shows no right to hire and fire by the plaintiffs, and even shows that defendants Ngo and Nguyen "fired" plaintiff Hoang from his job working in the chicken houses.

There is essentially no evidence of any agreement to share losses or assume liability to third parties for liabilities of the business. The only evidence in this case regarding sharing of losses is the testimony by Manh Hoang that he "would have shared in any losses." But there is no evidence that he ever offered to do so, was expected to do so, or that he ever became contractually bound in any way to pay any debt to a third party.

No one factor is determinative in the existence of a partnership, but given the fact that there was no evidence of intent to be partners, no joint management and control, and no agreement or obligation by the plaintiffs to assume losses, the evidence is simply insufficient as a matter of law to support the jury answer to Question No. 7. *126 Page 9 Hoang vs. Nguyen Mtn New Trial

10. INSUFFICIENT EVIDENCE OF DAMAGES FOR BREACH OF PARTNERSHIP AGREEMENT Plaintiffs' only evidence of any damages arising from any breach of the alleged partnership was (1) the2}Yoofnetprofits deducted andpaidto defendantsNgo andNguyen, and (2)the amounts U no ff i c i a l  C op y  O ff i c e  o f C h r i s  D an i e l  D i s t r i c t C l e r k withheld to pay federal income taxes. That is not proof of damages for a breach of a partnership agreement.

In order for the plaintiffs to recover for breach of a duty as a partner they have to show some damages that resulted from the breach of the partnership agreement. Plaintiffs offered no evidence of the value of a business enterprise as a continuing business. They could not because the business itself, a chicken farm, had been sold. Plaintiffs offered no evidence of any goodwill or value of the alleged partnership as an entity. Plaintiffs offered no evidence that partnership assets were lost: all the assets were sold and the proceeds distributed.

Defendants had no duty to continue to stay in business with Plaintiffs or to allow the plaintiffs to participate in any business venture they might enter into after the sale of the chicken farm. There is no such duty as a matter of law. Salinas v. Rafati,948 S.W.2d 286 (Tex. 1997).

Plaintiffs offered no calculation of damages from any breach of a partnership agreement upon which the jury could find any amount of damages. There is no distinction between the damages the jury found for breach of an agreement between the parties and the evidence of damages for breach of partnership. The evidence is insufficient to support any award of damages for breach of partnership. *127 Page ^[10] Hoang vs. Nguyen Mtn New Trial

11.

THE INTEREST

AWARDED ON THE DAMAGE,S FOLIND BY THE JURY IS COMPUTED INCORRECTLY One of the primary purposes of awarding pre-judgment interest to a plaintiff who prevails is to provide a disincentive to a defendant to delay the trial and disposition of case. U no ff i c i a l  C op y  O ff i c e  o f C h r i s  D an i e l  D i s t r i c t C l e r k In this case it was the plaintiffs who failed to promptly set the case for trial. In fact, on June 6, 2014,the Court dismissed the case for want ofprosecution. The case was reinstated by order dated July 1, 2014, upon motion by the plaintiffs.

The Texas Supreme Court discussed the purpose of pre-judgment interest in Johnson & Higgins v. Kenneco Energy,962 S.W.2d 507 (Tex. 1996). It referred to principles of "equity" and mentioned providing disincentives for defendants to delay. The Court noted that normally when there is a "tolling agreement" that the accrual of interest is also tolled. In this case it was the plaintiffs who caused delay, but they seek to recover interest that accrued during the period they delayed. A party that causes the delay should not benefit from the accrual ofinterest; therefore, Defendants contend that the Court should modify the award of pre-judgment interest accordingly.

Pre-judgment interest should be disallowed after June 6, 20l4,the date on which the Court dismissed the suit due to the failure of the plaintiffs to pursue it diligently. By that date the Court itself has sufficient evidence of a failure by the plaintiffs to timely prosecute their suit. In the altemative, interest from June 6, 2014,until July l,2014,should be disallowed for during thatperiod of time the case had been dismissed.

WHEREFORE, Defendants pray the Courl grant this Motion for New Trial and the relief *128 requested. Page I I Hoang vs. Nguyen Mtn New Trial

Respectfu lly submitted, State Bar No. 17238000 210 North Street Nacogdoches, TX 75961

U no ff i c i a l  C op y  O ff i c e  o f C h r i s  D an i e l  D i s t r i c t C l e r k (936) ss9-1188 FAX (936) ss9-0099 ATTORNEY FOR DEFENDANTS

CERTIFICATE OF SERVICE certifu that a copy of the foregoing document has been served on opposing counsel this ^.JhI d2 :'day of February,2015, by facsimile and email, to-wit: Mr. Scott K. Bui Bui, Pham & Nhan, PLLC FAX (713) 783-0787 email : sbui@buinhanlaw.com

*129 Page ^[12] Hoang vs. Nguyen Mtn New Trial

NOTES

[1] The Reporter’s Record refers to the producer as “Anderson Farms,” but the correct name is Sanderson Farms, and that name will used in this brief. xi

[2] W hen Appellees came to the final distribution of profits they had no idea of what would be distributed or what profit, if any, was made from the chicken farms. Appellee Hoang testified that he knew the farm was paid when batches of chicken were sold, but those payments are not income. Income is what is left after payment of fixed expenses such as servicing the debt on the farm and variable expenses such as labor costs, the cost of utilities, costs of upkeep and management, etc. Deere, p. 898. Since Appellee Hoang had no knowledge of the amount of those expenses he had no knowledge of the income from the farms. 9