Frank Zhang and Daxwell Group, LLC v. Capital Plastic & Bags, Inc. ( 2019 )


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  • Affirmed and Majority Opinion and Dissenting Opinion filed August 15, 2019.
    In The
    Fourteenth Court of Appeals
    NO. 14-17-00991-CV
    FRANK ZHANG AND DAXWELL GROUP, LLC, Appellants
    V.
    CAPITAL PLASTIC & BAGS, INC., Appellee
    On Appeal from the 295th District Court
    Harris County, Texas
    Trial Court Cause No. 2013-22591
    MAJORITY OPINION
    Capital Plastic & Bags, Inc. (“CPB”), a commercial tenant, sued its landlord
    for breach of contract and violation of Texas Property Code section 93.011,
    alleging that Frank Zhang and Daxwell Group, LLC retained its security deposit in
    bad faith. After conducting a bench trial, the trial court entered final judgment in
    favor of CPB. We affirm.
    I.     Background
    This case involves the sale and lease back of a manufacturing facility located
    in Houston, Texas.          Jeff Quan, the owner of CPB, agreed to a commercial
    transaction whereby there would be a sale of the building from CPB to Zhang or
    his assigns, with a lease back of a portion of the space. The sale contract provided
    for a soft close date. The sale closed and funded on January 4, 2007. The lease
    began on the date of closing and continued sixty (60) months. On January 3, 2007,
    “Frank Zhang or Assigns,” as landlord, and CPB, as tenant, entered into a
    commercial lease, wherein landlord leased approximately 96,000 square feet of
    warehouse space located in Houston, Harris County, Texas (“Premises”), to CPB
    for an initial term of five years.
    CPB paid its $34,560 security deposit, took possession of the Premises, and
    subsequently vacated and surrendered possession of the Premises in accordance
    with the terms of the lease. On or about January 3, 2012, after appellants’ third-
    party inspection of the Premises at the end of December 2012, appellee’s
    President, Jeff Quan, met with appellant Zhang at the Premises and surrendered the
    keys. Appellant Zhang permitted CPB to leave two small pieces of equipment in
    the Premises to be moved out at a later date. The parties dispute whether CPB is
    liable for any holdover rent. CPB contends that it surrendered keys and possession
    to the “landlord” and there was no discussion regarding holdover rent.
    CPB surrendered the premises and provided appellants with written notice of
    notice of its forwarding address, in accordance with paragraph 5 C. of the lease.1
    1
    Paragraph 5 C of the lease provides as follows:
    Within 60 days after Tenant surrenders the leased premises and provides Landlord
    written notice of Tenant’s forwarding address, Landlord will refund the security
    deposit less any amounts applied toward amounts owed by Tenant or other
    charges authorized by this lease.
    2
    Appellants failed to return CPB’s $34,560 security deposit within 60 days.
    Thereafter, CPB sent email requests for a refund of its security deposit, on March
    28, 2012, and May 28, 2012, and again by certified mail on February 5, 2013.
    Appellants failed to provide an accounting or refund CPB’s security deposit within
    60 days of any of those dates.
    On April 16, 2013, CPB filed this lawsuit to recover the full amount of the
    security deposit, along with additional damages pursuant to section 93.011 of the
    Texas Property Code. 2 CPB alleges both Zhang and Daxwell were the “landlord”
    under the lease and they are jointly and severally liable for damages. On July 15,
    2015, Daxwell and Zhang filed their original answer. On October 8, 2013, Zhang
    and Daxwell filed their counterclaim, asserting that the amount owed to them by
    CPB was $180,864.54, less CPB’s security deposit of $34,560, for a net total owed
    to them by CPB of $146,304.54. Daxwell brought breach of contract and offset
    counterclaims against CPB and a third-party claim against Jeff Quan, President of
    CPB, for breach of personal guaranty.
    In December 2014, Zhang filed a no-evidence motion for summary
    judgment against CPB. Zhang argued that “no evidence has been proffered by
    Plaintiff to show that Mr. Zhang is a proper party to this lawsuit.” According to
    Zhang, Zhang was the President of Daxwell, but Daxwell was the owner and
    landlord of the Premises. Zhang contends he executed the lease, but on behalf of
    Daxwell, not in his individual capacity. CPB filed its response maintaining Zhang
    is a proper party and attached as evidence a copy of the lease which names “Frank
    Zhang or Assigns” as the landlord, and which includes Zhang’s signature on the
    lease and on the Commercial Lease Guaranty, where he signed as a guarantor of
    2
    Appellants’ failure to timely itemize, render an accounting for, and refund CPB’s
    security deposit creates a statutory presumption under the Texas Property Code that appellants
    acted in bad faith. See Tex. Prop. Code § 93.011(d).
    3
    the lease. CPB also noted Zhang initialed a multitude of pages in the lease,
    exhibits, addendum and rules.
    CPB noted that there was no evidence of an assignment of the lease.
    On January 14, 2015, the trial court denied Zhang’s no-evidence motion for
    summary judgment.
    The case proceeded to trial without a jury on April 22, 2015, and again on
    November 8, 2016. Instead of a closing oral argument to the court, the parties
    submitted closing briefs. On July 6, 2017, CPB moved the court to enter final
    judgment.
    On October 2, 2017, the court rendered final judgment for CPB on all of its
    claims against Daxwell and Zhang. The trial court found that Zhang and Daxwell
    breached their lease agreement with CPB by wrongfully failing to return CPB’s
    security deposit, which caused CPB damages in the amount of $34,560. The trial
    court found, pursuant to section 93.011 of the Texas Property Code, CPB was
    entitled to a judgment in the amount of $100 plus three times the wrongfully
    withheld amount, for a total judgment of $103,780, together with pre- and post-
    judgment interest and reasonable attorney’s fees. Additionally, the trial court
    found CPB did not breach its lease agreement with Zhang and Daxwell. The court
    awarded CPB reasonable attorney’s fees and expenses in the amount of
    $50,585.26. The court ordered Daxwell to take nothing on its third-party claim
    against Quan. Finally, the court ordered “[a]ll relief requested in this case and not
    expressly granted is denied. This judgment finally disposes of all parties and
    claims and is appealable.”
    On November 16, 2017, the trial court entered its findings of fact and
    conclusions of law. The trial court entered 47 separate findings of fact and 14
    4
    conclusions of law. On November 22, 2017, Daxwell and Zhang moved the court
    to enter additional findings and conclusions. This appeal timely followed.
    II.    Analysis
    In three issues, appellants argue that the trial court erred by: (1) refusing to
    grant appellants’ request to enter additional and amended findings of fact and
    conclusions of law; (2) finding Zhang and Daxwell were both landlords; and
    (3) finding Zhang and Daxwell failed to overcome the bad-faith presumption for
    withholding a commercial lease deposit.
    A.    Additional and amended findings of fact and conclusions of law
    In their first issue, appellants complain about the trial court’s failure to make
    additional findings of fact and/or conclusions of law. Appellants argue they timely
    challenged the adequacy of the trial court’s findings of fact and conclusions of law
    and suffered harm by the trial court’s refusal to make such additional or modified
    findings.
    1.     Applicable law.
    A party may request additional or amended findings of fact and conclusions
    of law if the party believes that the court’s findings and conclusions are deficient in
    some way. Nicholas v. Envtl. Sys. (Int’l) Ltd., 
    499 S.W.3d 888
    , 894 (Tex. App.—
    Houston [14th Dist.] 2016, pet. denied) (citing Tex. R. Civ. P. 298); see Collins v.
    Walker, 
    341 S.W.3d 570
    , 574 (Tex. App.—Houston [14th Dist.] 2011, no pet.)
    (losing party may request additional findings on omitted elements to prevent them
    from being deemed on appeal). The trial court, as the trier-of-fact, however, has
    no duty make additional or amended findings that are unnecessary or contrary to its
    judgment; a trial court is only required to make additional findings and conclusions
    5
    that are appropriate. Vickery v. Comm’n for Lawyer Discipline, 
    5 S.W.3d 241
    , 254
    (Tex. App.—Houston [14th Dist.] 1999, pet. denied) (citations omitted).
    If a party requests additional findings and conclusions, the request “should
    sharpen, not obfuscate, the issues for appeal.” 
    Vickery, 5 S.W.3d at 255
    . “A
    request for negative findings will rarely apprise the trial court that it has omitted an
    essential element in its original findings.” 
    Id., at 254.
    Failure to make additional
    findings and conclusions may constitute reversible error if the appellant is
    prevented from adequately presenting the matter being complained of on appeal.
    See 
    id., at 256.
    If an appellant challenges a trial court’s failure to make additional findings,
    the reviewing court must address the issue on its merits; it cannot simply conclude
    from the court's failure to make additional findings that the court resolved the
    factual disputes contrary to the appellant’s position. 
    Vickery, 5 S.W.3d at 258
    .
    When an appellant properly requests additional findings of fact, the appellate court
    must consider whether such findings should have been made and whether the trial
    court’s failure to make such findings has prejudiced the appellant. 3 
    Id. at 257.
    2.      Additional and amended findings of fact and conclusions of law
    were not appropriate
    a.      Finding of fact 46
    Appellants maintain the trial court erred in refusing their request to omit the
    last sentence of finding of fact number 46. Appellants asked that the following be
    omitted: “The Landlord’s foregoing conduct was in bad faith.” Appellants contend
    3
    There is no error when the requested additional findings were disposed of directly or
    indirectly by the original findings, and the failure to make additional findings was not prejudicial
    to the appellant. 
    Vickery, 5 S.W.3d at 256
    –57 n.10 (citation omitted). The failure to make
    additional findings is not prejudicial to the appellant if the refusal does not prevent an adequate
    presentation on appeal. 
    Id. 6 that
    the same is not a proper finding of fact, but, rather a legal conclusion,
    premised on the trial court’s finding that appellants’ action or inactions constituted
    bad faith under Chapter 93 of the Texas Property Code.
    A trial court should not make findings on every controverted fact; the court
    should make additional findings of fact only if they have some legal significance to
    an ultimate issue in the case. 
    Vickery, 5 S.W.3d at 255
    –56. As set forth in CPB’s
    response, the trial court’s finding of fact 46 is a proper finding because “bad faith”
    under section 93.011 of the Texas Property Code is the same as a factual finding of
    “a commercial landlord . . . retains the security deposit in dishonest disregard of
    the tenant’s rights or with the intent to deprive the tenant of a lawfully due refund.”
    See FP Stores v. Tramontina US, Inc., 
    513 S.W.3d 684
    , 692–93 (Tex. App.—
    Houston [1st Dist.] 2016, pet. denied). Additionally, the preceding sentences in
    finding of fact number 46 further support the factual conclusion of bad faith.4
    Further, the finding supports the trial court’s conclusion of law number 4 that “The
    Landlord has failed to overcome the statutory presumption that the Landlord acted
    in bad faith.”
    Appellants’ brief does not address the significance of this requested
    modification or provide any legal authority supporting the request. Moreover, in
    their harm analysis, appellants fail to address finding of fact 46. They neither raise
    this point nor state how they were prejudiced by the trial court’s failure to modify
    finding of fact 46; thus, the point of error is waived. See Canton–Carter v. Baylor
    4
    Finding of fact 46 provides:
    The Landlord did not attempt to account to CPB for the security deposit until April 12,
    2013, when the Landlord sent an email stating that CPB owed the Landlord $27,712.89
    after the Landlord applied CPB's security deposit against the Landlord's claimed
    expenses. The Landlord did not provide a written description and itemized list of
    damages and offsets until June 24, 2013. (P Exhibit 10). The Landlord’s foregoing
    conduct was in bad faith.
    7
    Coll. of Med., 
    271 S.W.3d 928
    , 930 (Tex. App.—Houston [14th Dist.] 2008, no
    pet.) (“In the review of a civil case, an appellate court has no discretion to consider
    an issue not raised in the appellant’s brief.”).
    b.     Conclusion of law 1
    Next, appellants assert the trial court erred in denying their request to amend
    conclusion of law 1. Appellants requested “the Court to identify which of the
    Court’s factual findings gave rise to the legal conclusion that ‘Frank Zhang and
    Daxwell’ were ‘Landlord’ as stated in Conclusion of Law 1. Appellants contend
    that based on the findings “it is unclear what findings related to the lease
    agreement gave rise to the Court’s Conclusion that both Defendants were
    Landlord. Appellants asked the trial court to amend conclusion of law 1 to add at
    the end the following: “Because the Lease provided that lease payments were to
    be made to Daxwell Group, L.P. and that notice to the Landlord was to be made to
    Daxwell Group, L.P. both Zhang and Daxwell Group, L.P., were Landlord.”
    Appellants’ proposed amendment reiterates trial court findings of fact 6, 10,
    and 20.5 Additionally, appellants’ proposed modification ignores findings of fact
    21 and 24,6 which support conclusion of law 1. “The trial court is not required to
    5
    Finding of fact 6 provided “On January 3, 2007, CPB and “Frank Zhang or Assigns”
    (:Landlord”), entered into a Commercial lease. . . .”
    Finding of fact 10 provides “lease payment were to be made to ‘Daxwell Group, L.P.,’ at
    the address specified. . . .”
    Finding of fact 20 provided “notice to the Landlord was to be made to ‘Daxwell Group,
    L.P.’ . . ..”
    6
    Finding of fact 21 provided “ ‘This lease contains the entire agreement between
    Landlord and Tenant and may not be changed except by written agreement.’ ”
    Finding of fact 24 provided “The signatures on the Commercial Lease show that it was
    signed by the Landlord as ‘Frank Zhang by Daxwell Group.’ ” “There was no written assignment
    of the Commercial Lease by ‘Frank Zhang.’ ” The Commercial Lease Guaranty identified
    ‘Daxwell Group, L.P.,’ as a Landlord.”
    8
    set out in detail every reason or theory by which it arrived at its final conclusions.
    Nor is the trial court required to accept amended findings and conclusions that
    merely resolve evidentiary issues or are otherwise unnecessary.” See Nicholas v.
    Envtl. Sys. (Int’l) Ltd., 
    499 S.W.3d 888
    , 894–95 (Tex. App.—Houston [14th Dist.]
    2016, pet. denied). The trial court did not err in refusing to modify conclusion of
    law 1.
    c.    Conclusion of law 4
    Last, appellants assert the trial court erred in failing to make additional
    findings of fact to support the court’s conclusion of law 4, which provides
    “Landlord’s failure ‘to overcome the statutory presumption that the Landlord acted
    in bad faith.” Appellants argue that the court’s findings of fact do not include any
    mitigating evidence that appellants offered that would show that appellants failed
    to overcome the bad faith presumption. Specifically, appellants asked the court to
    enter eight bulleted points.
    Appellants’ brief does not provide any references to the record
    demonstrating that appellants requested findings of fact were supported by the
    record. It is not our duty to review the record, research the law, and then fashion a
    legal argument for an appellant when he has failed to do so. 
    Canton–Carter, 271 S.W.3d at 931
    –32. Briefing waiver occurs when a party fails to make proper
    citations to authority or to the record or provide any substantive legal analysis.
    Tex. R. App. P. 38.1(i) (argument must contain appropriate citations to the record).
    Even though we are required to interpret appellate briefs reasonably and liberally,
    parties asserting error on appeal still must put forth some specific argument and
    analysis citing the record and authorities in support of their argument. San Saba
    Energy, L.P. v. Crawford, 
    171 S.W.3d 323
    , 338 (Tex. App.—Houston [14th Dist.]
    2005, no pet.). And it is not our duty to perform an independent review of the
    9
    summary-judgment record for evidence supporting an appellants’ position. Priddy
    v. Rawson, 
    282 S.W.3d 588
    , 595 (Tex. App.—Houston [14th Dist.] 2009, pet.
    denied). With these principles in mind, we cannot rule on this request, and this
    portion of appellants’ appeal has been waived.
    Appellants’ first issue is overruled.
    B.    Sufficiency of the evidence
    1.     Standard of review
    In a nonjury trial, findings of fact have the same force and dignity as a jury’s
    verdict. Green v. Alford, 
    274 S.W.3d 5
    , 23 (Tex. App.—Houston [14th Dist.]
    2008, pet. denied). When a complete reporter’s record is filed, as here, we may
    review the trial court's findings of fact for legal and factual sufficiency under the
    same standards we apply to jury verdicts. See 
    id. (citing Ortiz
    v. Jones, 
    917 S.W.2d 770
    , 772 (Tex. 1996) (per curiam)).
    In conducting a sufficiency review, we consider the evidence in the light
    most favorable to the challenged findings and indulge every reasonable inference
    that supports them. George Joseph Assetts, LLC v. Chenevert, 
    557 S.W.3d 755
    ,
    765 (Tex. App.—Houston [14th Dist.] 2018, pet. denied). The evidence is legally
    sufficient if it would enable reasonable and fair-minded people to reach the
    decision under review. 
    Id. We credit
    favorable evidence if a reasonable factfinder
    could, and disregard contrary evidence unless a reasonable fact-finder could not.
    
    Id. When appellants
    attack a finding on an issue on which they did not have the
    burden of proof, appellants must demonstrate that no evidence supports the adverse
    finding. 
    Id. Evidence is
    legally insufficient to support a finding when (1) the
    record bears no evidence of a vital fact; (2) the court is barred by rules of law or of
    evidence from giving weight to the only evidence offered to prove a vital fact;
    (3) the evidence offered to prove a vital fact is no more than a mere scintilla; or
    10
    (4) the evidence conclusively establishes the opposite of a vital fact. 
    Id. In reviewing
    the factual sufficiency of the evidence, we examine the entire
    record, considering both the evidence in favor and contrary to the challenged
    findings.   
    Chenevert, 557 S.W.3d at 765
    .        We may set aside the verdict for
    factually insufficient evidence only if the verdict is so contrary to the
    overwhelming weight of the evidence as to be clearly wrong and unjust. 
    Id. The party
    asserting that the evidence is factually insufficient must establish that the
    finding is against the great weight and preponderance of the evidence. 
    Id. In assessing
    the evidence, we do not act as factfinder in that we may not pass on the
    credibility of the witnesses or substitute our judgment for that of the factfinder. 
    Id. Instead, the
    trial court, as the trier of fact in this case, is the “sole judge of the
    credibility of the witnesses and the weight to afford their testimony.” 
    Id. 2. Zhang
    and Daxwell are the landlord on the lease.
    In their second issue, appellants contend that the trial court’s finding that
    Zhang is liable for damages should be reversed, arguing that the “overwhelming
    weight of the evidence supports a finding that Daxwell, not Zhang, was the owner
    and landlord of the property.” Appellants assert that “the lease is not ambiguous as
    the parties thereto,” showing Daxwell was the owner and landlord of the leased
    Premises.
    “At the outset, we note that conflicting interpretations of a contract and
    unclear and uncertain language do not necessarily mean a contract is ambiguous.”
    See Mobil Exploration & Producing U.S., Inc. v. Dover Energy Exploration,
    L.L.C., 
    56 S.W.3d 772
    , 776-77 (Tex. App.—Houston [14th Dist.] 2001, no pet.)
    (citing Kelley–Coppedge, Inc. v. Highlands Ins. Co., 
    980 S.W.2d 462
    , 465 (Tex.
    1998)). A contract is not ambiguous if it can be given a certain and definite
    meaning or interpretation. 
    Id. (citing Coker
    v. Coker, 
    650 S.W.2d 391
    , 393 (Tex.
    11
    1983)). We must interpret an unambiguous contract as a matter of law. 
    Id. The uncontroverted
    evidence in the record demonstrates the parties executed
    multiple instruments related to the sale and leaseback of the property.
    Significantly, under “parties,” of the commercial contract--improved property, the
    buyer is shown as “Frank Zhang or Assigns.” Under “parties” of the commercial
    lease, the landlord is listed as “Frank Zhang or Assigns.” However, the Lease
    further shows that Zhang individually:
    • initialed pages 1 through 13, and had also initialed the deletion and changes
    on pages 12 and 13 of the Lease;
    • signed the Lease on page 14 as Landlord;
    • initialed Exhibit “A” of the Lease;
    • initialed page 1 and signed page 2 as Landlord of the Commercial Lease
    Expense Reimbursement Addendum and initialed the insertion under
    “Special Provisions”;
    • initialed page 1 and signed page 2 as Landlord of the Commercial Lease
    Addendum for Extension Option;
    • initialed page 1 and signed page 2 as Landlord of the Commercial Lease
    Parking Addendum;
    • initialed the Rules and Regulations’ page to the Lease;
    • signed the Commercial Lease Guaranty as a Guarantor of the Lease;
    • initialed the Addendum 2 page and the changes made to Addendum 2 of the
    Lease; and
    • initialed the Addendum 4 page of the Lease.
    Moreover, paragraph 36.A on page 14 of the Lease contains a merger/integration
    clause and further provides that the Lease “may not be changed except by written
    agreement.”
    The closing documents also demonstrate multiple instances of Zhang having
    signed on behalf of Daxwell. Also, the warranty with vendor’s lien shows Daxwell
    12
    as the grantee. Notwithstanding, with respect to the lease, there was no evidence at
    trial of a written assignment of the Lease. Appellants acknowledged in a brief to
    the trial court “[f]or unknown reasons, the Lease was filled out prior to the
    assignment of the contract and the closing and stated that the landlord was “Frank
    Zhang or assigns.” In his deposition, Zhang was asked, “What was your plan for
    the property at closing: Were you going to put it into your name? He responded,
    “No, Daxwell Group, LLC.” He then went on to testify that he did not closely read
    everything at closing to ensure the information was correct.
    An assignment of a lease is an assignment of an interest in real property, and
    since the Lease is for a term longer than one year, such an assignment is required
    to be in writing under the Texas Statute of Frauds. See Tex. Bus. & Com. Code §
    26.01(b)(4), (5), and (6); Swinehart v. Stubbeman, 
    48 S.W.3d 865
    , 875 (Tex.
    App.—Houston [14th Dist.] 2001, pet. denied) (assignment of oil and gas lease
    governed by the statute of frauds). Accordingly, the Lease unambiguously shows
    that Frank Zhang is named as the landlord. There is no assignment of the Lease in
    the record to Daxwell. The trial court’s determination that Zhang and Daxwell are
    landlord is supported by the evidence of record.
    Appellants’ second issue is overruled.
    3.     Failure to return security deposit.
    a.    Texas Property Code requirements
    The Property Code grants a commercial tenant the right to sue a landlord for
    retaining a security deposit in bad faith. Section 93.011 provides:
    (a) A landlord who in bad faith retains a security deposit in violation
    of this chapter is liable for an amount equal to the sum of $100, three
    times the portion of the deposit wrongfully withheld, and the tenant's
    13
    reasonable attorney’s fees incurred in a suit to recover the deposit
    after the period prescribed for returning the deposit expires.
    (b) A landlord who in bad faith does not provide a written description
    and itemized list of damages and charges in violation of this chapter:
    (1) forfeits the right to withhold any portion of the security
    deposit or to bring suit against the tenant for damages to the
    premises; and
    (2) is liable for the tenant's reasonable attorney’s fees in a suit
    to recover the deposit.
    (c) In a suit brought by a tenant under this chapter, the landlord has
    the burden of proving that the retention of any portion of the security
    deposit was reasonable.
    (d) A landlord who fails to return a security deposit or to provide a
    written description and itemized list of deductions on or before the
    60th day after the date the tenant surrenders possession is presumed to
    have acted in bad faith.
    Tex. Prop. Code § 93.011. Chapter 93 establishes two distinct causes of action for
    a tenant seeking the return of his security deposit. See Tex. Prop. Code § 93.011.
    The first cause of action involves the landlord's bad faith retention of the security
    deposit. 
    Id. § 93.011(a).
    The second cause of action involves the landlord's bad
    faith failure to account for the security deposit. 
    Id. § 93.011(b).
    Moreover, the
    landlord has the burden to prove the retention of any portion of the security deposit
    was reasonable. 
    Id. § 93.011(c).
    Thus, statutory damages under section 93.011 are “predicated on a
    determination that the landlord retained the deposit ‘in bad faith.’ ” Eun Bok Lee v.
    Ho Chang Lee, 
    411 S.W.3d 95
    , 106–07 (Tex. App.—Houston [1st Dist.] 2013, no
    pet.). If the tenant shows that the landlord failed either to return the tenant’s
    security deposit or to provide the tenant a written description and itemized list of
    deductions within sixty days of the tenant surrendering possession of the leased
    premises, then it is presumed that the landlord acted in bad faith, and the burden
    14
    shifts to the landlord to rebut the presumption. Tex. Prop. Code § 93.011(d); Eun
    Bok 
    Lee, 411 S.W.3d at 107
    . If the landlord fails to offer rebutting evidence, its
    bad faith is established as a matter of law.
    “There is a dearth of case law construing and applying section 93.011.(d).”
    FP Stores, Inc. v. Tramontina US, Inc., 
    513 S.W.3d 684
    , 691 (Tex. App.—Houston
    [1st Dist.] 2016, no pet.) “For guidance we look to the more developed body of
    case law construing and applying Property Code section 92.109—a parallel statute
    that applies to residential tenancies.” 
    Id. (emphasis added).
            Section 92.109
    provides: (a) A landlord who in bad faith retains a security deposit in violation of
    this subchapter is liable for an amount equal to the sum of $100, three times the
    portion of the deposit wrongfully withheld, and the tenant’s reasonable attorney’s
    fees in a suit to recover the deposit.
    (a) A landlord who in bad faith retains a security deposit in violation
    of this subchapter is liable for an amount equal to the sum of $100,
    three times the portion of the deposit wrongfully withheld, and the
    tenant’s reasonable attorney’s fees in a suit to recover the deposit.
    (b) A landlord who in bad faith does not provide a written description
    and itemized list of damages and charges in violation of this
    subchapter:
    (1) forfeits the right to withhold any portion of the security
    deposit or to bring suit against the tenant for damages to the
    premises; and
    (2) is liable for the tenant's reasonable attorney’s fees in a suit
    to recover the deposit.
    (c) In an action brought by a tenant under this subchapter, the landlord
    has the burden of proving that the retention of any portion of the
    security deposit was reasonable.
    (d) A landlord who fails either to return a security deposit or to
    provide a written description and itemization of deductions on or
    before the 30th day after the date the tenant surrenders possession is
    presumed to have acted in bad faith.
    15
    Tex. Prop. Code § 92.109.
    Case law analyzing section 92.109 addresses both what constitutes “bad
    faith” and how a residential landlord may rebut the presumption that it acted in bad
    faith. These cases hold that a residential landlord acts in bad faith if it either “acts
    in dishonest disregard of the tenant’s rights or intends to deprive the tenant of a
    lawfully due refund.” Johnson v. Waters at Elm Creek, L.L.C., 
    416 S.W.3d 42
    , 47
    (Tex. App.—San Antonio 2013, pet. denied). These cases further hold that, to
    rebut the presumption of bad faith, the landlord must prove its good faith—that is,
    the landlord must prove “‘honesty in fact in the conduct or transaction
    concerned.’” Hardy v. 11702 Mem’l, Ltd., 
    176 S.W.3d 266
    , 271 (Tex. App.—
    Houston [1st Dist.] 2004, no pet.) (quoting Wilson v. O’Connor, 
    555 S.W.2d 776
    ,
    780 (Tex. App.—Dallas 1977, writ dism’d)).
    For example, in Pulley v. Milberger, the Dallas Court of Appeals affirmed a
    trial court’s judgment in favor of a residential landlord, in part because the
    evidence showed that the landlord was an amateur lessor who believed he could
    retain the security deposit due to the damage to the property. See 
    198 S.W.3d 418
    ,
    430–31 (Tex. App.—Dallas 2006, pet. denied). In its opinion, the court discussed
    the evidence necessary to rebut the presumption of bad faith, stating:
    Evidence that a landlord had reason to believe he was entitled to
    retain a security deposit to recover reasonable damages is sufficient to
    rebut the presumption of bad faith created by the Texas Property
    Code. Other evidence may include: (1) the landlord is an amateur
    lessor because the residence is his only rental property; (2) the
    landlord had no knowledge of the requirement to submit an itemized
    list of all deductions from the security deposit; (3) extensive damage
    was done to the residence; (4) the landlord attempted to do some of
    the repairs himself to save money; or (5) the landlord had a reasonable
    excuse for the delay, e.g., he was on vacation.
    
    Id. at 428–29
    (citations omitted).
    16
    The section 92.109 case law is instructive here.          Under Property Code
    section 93.011, a commercial landlord retains a tenant’s security deposit in bad
    faith if it retains the security deposit in dishonest disregard of the tenant’s rights or
    with the intent to deprive the tenant of a lawfully due refund. See FP Stores, 
    Inc. 513 S.W.3d at 693
    . “If the tenant shows that the landlord failed to timely provide a
    refund of the security deposit or an accounting, then it is presumed that the
    landlord acted in bad faith.” 
    Id. (citing Tex.
    Prop. Code § 93.011(d)).
    “To rebut the presumption to defeat a tenant’s motion for summary
    judgment, the landlord must present more than a scintilla of evidence that it acted
    in good faith.” FP Stores, 
    Inc., 513 S.W.3d at 693
    (citations omitted). “That is, the
    landlord must present more than a scintilla of evidence of ‘honesty in fact in the
    conduct or transaction involved’—that it acted with an honest regard for the
    tenant’s rights and with the intent to provide the tenant with a refund and an
    accounting.” 
    Id. b. Zhang
    and Daxwell failed to overcome the bad-faith
    presumption for withholding CPB’s security deposit.
    The trial court made the following findings of fact related to the withholding
    of CPB’s security deposit.
    44.     CPB made request to the Landlord for refund of its security
    deposit by emails dated March 28 and May 28, 2012, and by a
    letter dated February 5, 2013, and sent by US Postal Service,
    Certified Mail Return Receipt Requested. Each of the emails
    and the letter displayed CPB’s new address, and the letter
    specifically requested that the Landlord “send the refund to the
    forwarding address below within 10 business days.” (P Exhibit
    9).
    45.    CPB had previously provided the Landlord with CPB’s new
    address for billing purposes. Through March 2012, the
    Landlord mailed invoices to CPB at its new address for goods
    17
    that CPB ordered and received from the Landlord. (2 RR 13-
    17).
    46.   The Landlord did not attempt to account to CPB for the security
    deposit until April 12, 2013, when the Landlord sent an email
    stating that CPB owed the Landlord $27,712.89 after the
    Landlord applied CPB’s security deposit against the Landlord’s
    claimed expenses. The Landlord did not provide a written
    description and itemized list of damages and offsets until June
    24, 2013. (P Exhibit 10). The Landlord’s foregoing conduct
    was in bad faith.
    47.   The Landlord did not make any claim for or charge CPB for
    holdover rent until June 24, 2013, (P Exhibit 10) being over 2
    months after this lawsuit was filed and being the same day the
    Landlord was served with citation from the Secretary of State.
    The trial court made the following findings of fact related to the withholding
    of CPB’s security deposit.
    3.    The Landlord breached Paragraph 5.C of the Commercial Lease
    and failed to comply with Texas Property Code §93.005(a) by
    failing to return CPB’s security deposit not later than the 60th
    day after the date CPB surrendered the leased premises and
    provided notice to the Landlord of CPB’s forwarding address.
    4.    The Landlord has failed to overcome the statutory presumption
    that the Landlord acted in bad faith. Tex. Prop. Code
    §93.011(d).
    5.    The Landlord has failed to carry the Landlord’s burden of
    proving that the retention of any portion of the security deposit
    was reasonable. Tex. Prop. Code §93.011(c).
    6.    The Landlord is liable to CPB for an amount equal to the sum
    of $100 plus three times $34,560, being the portion of the
    security deposit wrongfully withheld, being a total of $103,780.
    Tex. Prop. Code §93.011(a).
    7.    The Landlord has forfeited its right to withhold any portion of
    the security deposit or to bring suit against CPB for damages to
    the premises. Tex. Prop. Code §93.011(b).
    8.    The Landlord failed to provide any evidence that the CAM
    18
    expense the Landlord seeks to recover against CPB were
    “reasonably incurred to maintain, repair, operate, manage, and
    secure the Property” as required by Paragraph A. (2) of the
    Commercial Lease Expense Reimbursement Addendum.
    9.     The Landlord failed to provide any evidence that the specific
    amounts the Landlord charged CPB for 2011 CAM expenses
    for insurance; landscaping; management fee; pest control;
    building and property repairs and maintenance; sprinkler
    system monitoring, inspection and repairs; and the HFD Project
    were in accordance with an agreement with CPB for the
    specific amount charged, or were the usual, customary and
    reasonable prices for those goods and/or services. Andy’s Mart
    #352 v. Reliant Energy Retail Services, 2009 Tex. LEXIS 8559
    at *9 (Tex. App.—Houston [1st Dist.] 2009, no pet.).
    10.    The Landlord also failed to authenticate its 2011 CAM, (D
    Exhibit 26)15; 2012 CAM, (D Exhibit 27)16; and other
    leasehold expense documents (D Exhibit 29)17 as business
    records, the same having been admitted for the limited purposes
    of evidencing that the documents were sent.
    As the trier of fact, it is within the trial court’s responsibility to assess the
    witness’s credibility and determine the weight to be given to the testimony.
    
    Johnson, 416 S.W.3d at 49
    . “We may not substitute our judgment for that of the
    trier of fact or pass on the credibility of the witnesses.” Sunl Group, Inc. v.
    Zhejiang Yongkang Top Imp. & Exp. Co., Ltd., 
    394 S.W.3d 812
    , 817 (Tex. App.—
    Dallas 2013, no pet.).
    The trial court’s determinations are supported by the evidence of record.
    Appellants had the burden at trial to prove that their retention of the security
    deposit was reasonable, and that their failure to timely provide an accounting was
    excused. See Johnson v. Waters at Elm Creek LLC, 
    416 S.W.3d 42
    , 47–48 (Tex.
    App.—San Antonio 2013, pet. denied).          If the landlord failed to provide an
    accounting of the damages and charges in violation of the statute and is unable to
    rebut the presumption of bad faith, the landlord “forfeits the right to withhold any
    19
    portion of the security deposit or to bring suit against a tenant for damages to the
    premises.” Tex. Prop Code § 93.011(b)(1). Here, appellants failed to carry their
    burden of proof at trial to overcome the presumption of bad faith, and therefore
    forfeited their right to withhold any portion of the security deposit or sue for any
    damages. 7 See Eun Bok 
    Lee, 411 S.W.3d at 107
    .
    Appellants’ third issue is overruled.
    III.   Conclusion
    The trial court’s judgment is affirmed.
    /s/    Margaret “Meg” Poissant
    Justice
    Panel consists of Chief Justice Frost and Justices Bourliot and Poissant. (Frost,
    C.J., dissenting).
    7
    Even if appellants had been able to defeat the presumption of bad faith with regard to
    the retention of CPB’s security deposit, appellants then would have been required to prove that
    their retention of the security deposit was reasonable. See 
    Pulley, 198 S.W.3d at 429
    .
    20