concept-general-contracting-inc-dba-concept-builders-bw-affordable ( 2011 )

NO. 07-10-00332-CV
IN THE COURT OF APPEALS
FOR THE SEVENTH DISTRICT OF TEXAS
AT AMARILLO
PANEL A
JULY 18, 2011
CONCEPT GENERAL CONTRACTING, INC., D/B/A
CONCEPT BUILDERS, BW AFFORDABLE HOUSING, L.P.,
AND CAPITOL INDEMNITY CORP., APPELLANTS
v.
ASBESTOS MAINTENANCE SERVICES, INC., APPELLEE
FROM THE 222ND DISTRICT COURT OF DEAF SMITH COUNTY;
NO. CI-05H-106; HONORABLE ROLAND D. SAUL, JUDGE
Before CAMPBELL and HANCOCK and PIRTLE, JJ.
OPINION
Appellants, Concept General Contracting, Inc. (Concept) and Capitol Indemnity
Corp. (Capitol), appeal a judgment awarding damages to appellee, Asbestos
Maintenance Services, Inc. (AMS), in an amount of $120,883.95. We affirm the
judgment of the trial court.
Background
On May 27, 2004, BW Affordable Housing, L.P. (BW), contracted with Concept to
renovate certain apartment units owned by BW in Hereford, Texas. Concept, as
general contractor for the project, executed and filed a payment bond issued by Capitol.
As part of this project, Concept and AMS entered into a subcontract for AMS to provide
asbestos abatement for restricted areas within 125 apartment units. This contract
specifically limited the areas to be abated in a manner that would allow AMS to utilize
an abatement method that is less intrusive and less costly than a full abatement. Soon
after AMS began work on the project, Concept requested some additional remediation.
AMS gave Concept a quote for this additional work, performed this additional work, and
Concept paid AMS for this additional work.
While AMS was performing the work identified in these two contracts, Jack
Scheuerer, construction superintendent for Concept, requested AMS perform additional
abatement in certain units. Concept began performing this additional work, but the
additions were so numerous that they dramatically enlarged the scope of the project,
and altered the means by which the abatement could be performed.1 This extra work
was billed to Concept as it was performed by AMS. For the first four invoices, Concept
paid for the extra work without objection. However, somewhere around the fifth invoice,
Concept stopped paying for the extra work that AMS had performed. For approximately
1
According to the testimony of Glen Ashton, a third-party air maintenance
consultant employed for this project, the additional work requested by Scheuerer more
than doubled the scope of the work that was covered by the first two contracts, and
altered the manner of performing the work by requiring area containment and the
donning of hazmat suits.
2
eleven invoices, AMS continued to do the extra work that was marked at the job site by
Scheuerer, but AMS eventually ceased doing this work when it determined that Concept
was not going to pay for this extra work. However, AMS continued to perform the work
delineated in the two contracts for some time. At some point in the project, AMS
ceased working and left the work site but stood ready to complete the contract work if
and when recalled to the site by Concept. However, Concept did not call AMS back to
the work site. Rather, Concept contracted with another asbestos abatement company
to complete the work under the contracts as well as additional work that needed to be
done.
On the basis of the unpaid extra work, AMS brought suit against Concept and
Capitol (collectively “appellants”). After a two-day trial, the trial court took the case
under advisement. Nearly three years later, the trial court entered its judgment
awarding AMS $120,883.95 in damages, post-judgment interest, and $25,000 in
attorney’s fees. Concept and Capitol then filed a motion for new trial, which was denied
after hearing. Concept and Capitol also filed a request for findings of fact and
conclusions of law. The trial court entered findings of fact and conclusions of law.
Appellants present fifteen issues by this appeal. By their first two issues,
appellants contend that the trial court erred in awarding AMS recovery for quantum
meruit because this was an undisclosed theory of recovery. By their third and fourth
issues, appellants contend that the trial court abused its discretion in admitting
documentary exhibits and photographs as business records. By their fifth issue,
appellants contend that the trial court erred in finding appellants liable under a theory of
3
quantum meruit when AMS dismissed the proper party, the owner of the benefited
property. By their sixth, seventh, eighth, and tenth issues, appellants contend that the
evidence was factually insufficient to support the trial court’s judgment. By their ninth
issue, appellants contend that liability under the theory of quantum meruit was error
because of the existence of express contracts covering the work performed. By their
eleventh and fifteenth issues, appellants contend that the trial court erred by failing to
comply with the requirements of Texas Government Code section 74.059(c)(2). By their
twelfth issue, appellants appear to contend that the evidence established their
affirmative defenses of waiver or estoppel as a matter of law. By their thirteenth and
fourteenth issues, appellants contend that they established their counterclaim as a
matter of law and should, therefore, have been awarded these damages and attorney’s
fees. We will overrule each of these issues, and affirm the judgment of the trial court.
Issues 1 & 2: Failure to Disclose Theories of Recovery
By their first two issues, appellants contend that the trial court abused its
discretion in admitting evidence to support AMS’s quantum meruit and payment bond
theories of recovery because AMS failed to expressly disclose these theories in
response to a request for disclosure. Appellants contend that, under Texas Rule of Civil
Procedure 193.6(a), AMS’s failure to specifically identify these theories of recovery in its
disclosure prevents AMS from introducing evidence to support these theories. AMS
responds that each of its three petitions, including its live pleading, included claims for
quantum meruit damages and recovery from the payment bond, and that pleading these
theories of recovery is sufficient.
4
The appellants’ contention is premised entirely on AMS’s failure to specifically
disclose the theories of recovery under quantum meruit and the payment bond in
response to appellants’ request for disclosure of “[t]he legal theories and, in general, the
factual bases of your claims or defenses.” AMS responded to this request by disclosing
that,
Plaintiff contracted with Concept General Contracting, Inc. to perform
asbestos abatement services, and performed all services requested until it
became apparent that Concept was refusing to pay for same, at which
time work was suspended pending resolution of outstanding receivables.
Thereafter, Concept requested that plaintiff remove its remaining materials
from the job.
Appellants contend that AMS’s failure to explicitly disclose that it was seeking recovery
under the theory of quantum meruit and the payment bond provided by Capitol triggers
the exclusionary provision of Texas Rule of Civil Procedure 193.6 to prevent AMS from
offering any evidence to support these theories of recovery. See TEX. R. CIV. P.
193.6(a).
This Court finds it extremely significant that the record reflects that both theories
of recovery were always pled by AMS as theories upon which it sought recovery from
appellants. Notice that a plaintiff is pursuing a particular theory of recovery generally
must come from the pleadings. See Cunningham v. Parkdale Bank, 660 S.W.2d 810,
812 (Tex. 1983) (pleadings define the issues at trial and give opposing party sufficient
information to enable him to prepare a defense). Appellants do not contest that each of
these theories of recovery were properly pled by AMS nor did they file any special
exceptions to AMS’s pleadings. Thus, appellants were afforded appropriate notice that
5
AMS intended to pursue theories of recovery in quantum meruit and under the payment
bond.
Further, while failures to comply with requests for disclosure result in automatic
exclusion of the non-disclosed evidence, absent proof of good cause or lack of unfair
surprise or unfair prejudice, see TEX. R. CIV. P. 193.6(a); Phan v. Addison Spectrum,
L.P., 244 S.W.3d 892, 899 (Tex.App.—Dallas 2008, no pet.), properly pled claims for
affirmative relief, as opposed to withheld evidence, are not abandoned or waived by a
party’s failure to expressly identify those claims in a response to a request for
disclosure.2 See Killam Ranch Props., Ltd. v. Webb County, No. 04-08-00105-CV,
2008 Tex.App. LEXIS 8682, at *3-*5 (Tex.App.—San Antonio Nov. 19, 2008, no pet.)
(mem. op.) (holding failure to respond to discovery request not an abandonment of
properly pled claim for attorney’s fees).
Because the live pleadings of AMS provide notice of its intent to pursue recovery
under the theories of both quantum meruit and the payment bond and because its
failure to expressly identify those theories in its responses to discovery requests are not
an abandonment of those claims, we overrule appellants’ first two issues.
2
In fact, this distinction between the failure to disclose evidence in response to a
discovery request as opposed to the failure to disclose properly pled theories of
recovery is precisely why the trial court’s ruling excluding the testimony of appellants’
untimely disclosed expert was proper. The withholding of evidence that is necessary to
respond to a discovery request properly results in the exclusion of that evidence under
Rule 193.6(a).
6
Issues 3 & 4: Business Records
By their third and fourth issues, appellants contend that the trial court abused its
discretion by admitting certain documents and photographs as unauthenticated
business records. The documents constitute AMS’s Exhibits Five through Nineteen and
appear to be records relating to the work that AMS’s employees performed on the BW
project. The photographs, AMS’s Exhibit Twenty, portray various stages of work
performed in unidentified apartment units. Appellants contend that the challenged
evidence was not properly authenticated and constitutes hearsay for which AMS has
failed to establish any applicable exception to the hearsay rule. AMS responds that the
testimony of Jack Coiner, an owner of AMS, established each of the requisites to qualify
the challenged evidence as business records, which are excepted from the hearsay
rule. See TEX. R. EVID. 803(6).
Evidentiary rulings are committed to the sound discretion of the trial court. Bay
Area Healthcare Group, Ltd. v. McShane, 239 S.W.3d 231, 234 (Tex. 2007). A trial
court abuses its discretion when it acts without reference to any guiding rules and
principles. Downer v. Aquamarine Operators, Inc., 701 S.W.2d 238, 241-42 (Tex.
1985). However, even if a trial court abuses its discretion by improperly admitting
evidence, reversal is warranted only if the error probably caused the rendition of an
improper judgment. See TEX. R. APP. P. 44.1; Bay Area Healthcare, 239 S.W.3d at 234.
In such an instance, an appellate court reviews the entire record and requires the
complaining party to demonstrate that the judgment turns on the particular evidence
admitted. Bay Area Healthcare, 239 S.W.3d at 234.
7
Evidence is authenticated by proof that the challenged evidence is what its
proponent claims it to be. See TEX. R. EVID. 901(a).3 Hearsay is defined as a
statement, other than one made by the declarant while testifying at trial or hearing,
offered in evidence to prove the truth of the matter asserted. Rule 801(d). Generally,
hearsay is not admissible in evidence. Rule 802. However, there are a number of
exceptions to this general rule, including the “business records” exception found in Rule
803(6). For evidence to be admissible as a business record, the record must have been
made at or near the time that the recorded event occurred by a person with knowledge
of the event if the record was kept in the course of a regularly conducted business
activity as shown by the testimony of a custodian of the record or other qualified
witness. See Rule 803(6).
In the present case, appellants objected to the challenged evidence as not
having been properly authenticated by a person with personal knowledge of the
contents of the evidence and as violating the hearsay rule. AMS presented testimony
from Coiner that the evidence was made at or near the time that the work was
performed by a person with knowledge of the work performed and that these records
were kept in the ordinary course of business. Further, Coiner testified that he was the
custodian of the challenged records.
Coiner, during voir dire, identified each document in Plaintiff’s Exhibit Five, which
appellants treated as representative of Exhibits Five through Nineteen, as well as
identifying what the photographs contained in Exhibit Twenty portrayed. Coiner’s
3
Further reference to the Texas Rules of Evidence will be by “Rule ___.”
8
testimony that the evidence accurately portrays what AMS claims it portrays, which is
the records and photographs from the BW project that were compiled during work on
the project, is sufficient evidence to satisfy the authentication requirement of Rule
901(a), regardless of whether Coiner had personal knowledge of the contents of this
evidence. See Kirwan v. City of Waco, 249 S.W.3d 544, 549 (Tex.App.—Waco 2008),
rev’d on other grounds, 298 S.W.3d 618 (Tex. 2009). Thus, we find the challenged
evidence to have been properly authenticated and that the trial court did not abuse its
discretion in admitting the evidence over appellants’ authentication objection.
In regard to appellants’ challenge to whether AMS established the business
records exception to the hearsay rule, Coiner testified to each of the requisites to
establish the evidence as business records under Rule 803(6). However, appellants
again contend that Coiner did not have personal knowledge of the information contained
in the records. But, for a witness to establish the business record exception, he need
not have been the record’s creator or have any personal knowledge of the contents of
the record; rather, the witness need only have personal knowledge of the manner in
which the records were prepared. Brooks v. State, 901 S.W.2d 742, 746 (Tex.App.—
Fort Worth 1995, pet. ref’d). We conclude that Coiner’s testimony established the
requisites for application of the business records exception, and, therefore, that the trial
court did not abuse its discretion in admitting the evidence over appellants’ hearsay
objection.
9
Because the trial court did not abuse its discretion in admitting AMS’s Exhibits
Five through Twenty over appellants’ authentication and hearsay objections, we
overrule appellants’ third and fourth issues.
Issue 5: Proper Party
By their fifth issue, appellants contend that the trial court erred in awarding
damages to AMS against Concept and Capitol because neither appellant owned the
apartment units and, therefore, could not be liable for quantum meruit damages. AMS
responds contending that Concept is the proper party against whom quantum meruit
damages should be assessed because it was Concept, rather than the owner of the
apartment complex, that requested the extra work.
In its original petition, AMS named the owner of the apartment units, BW, as a
defendant. However, in its subsequent amended petitions, AMS dropped BW as a
defendant. On this basis, appellants cite Truly v. Austin, 744 S.W.2d 934, 937 (Tex.
1988), for the proposition that “[c]entral to the contractor’s right to recover in quantum
meruit is the owner’s acceptance and retention of the benefits arising as a direct result
of the contractor’s partial performance.” Interpreting this quoted portion of Truly as
literally as possible, appellants contend that it is only the owner of the benefitted
property that can be held liable under the theory of quantum meruit. However, the Truly
court makes clear that, to recover in quantum meruit, the plaintiff must show that its
efforts were undertaken for the person sought to be charged. Id. Incidental benefits to
other parties do not give rise to quantum meruit claims against those third-party
beneficiaries. See id.; Bashara v. Baptist Mem’l Hosp. Sys., 685 S.W.2d 307, 310 (Tex.
10
1985); see also Sourignavong v. Methodist Healthcare Sys., 977 S.W.2d 382, 385
(Tex.App.—Amarillo 1998, pet. denied).
In the present case, the evidence is clear that AMS contracted with Concept, as
general contractor, to provide specific asbestos abatement services. The evidence
does not establish that AMS ever dealt with BW directly. Further, all of the extra work
that was requested was at the direction of Scheuerer, Concept’s construction
superintendent for the project. Thus, it was Concept, rather than BW, for whom AMS
performed the extra work. See Bearden Investigative Agency, Inc. v. Melvin, No. 2-02-
078-CV, 2003 Tex.App. LEXIS 957, at *17-*18 (Tex.App.—Fort Worth Jan. 30, 2003, no
pet.); Fidelity Savs. & Loan Ass’n v. Morrison & Miller, Inc., 764 S.W.2d 385, 387-88
(Tex.App.—Beaumont 1989, no writ). Further, evidence was presented that Concept
needed AMS’s asbestos abatement, including the extra work, in order for Concept to
complete its general contract with BW. Therefore, the record establishes that the extra
work performed by AMS was for the benefit of Concept, and was not an incidental
benefit to a third-party.
As such, we conclude that AMS could properly assert a claim of quantum meruit
against Concept, and overrule appellants’ fifth issue.
Issues 6, 7, 8, & 10: Factual Sufficiency of the Evidence
By appellants’ sixth, seventh, and eighth issues, appellants contend that the
evidence is factually insufficient to support the quantum meruit elements that AMS
provided appellants valuable services or materials (issue six), AMS’s work benefited
appellants (issue seven), and Concept accepted services or materials from AMS (issue
11
eight). By their tenth issue, appellants contend that the evidence is factually insufficient
to support the trial court’s judgment against Capitol under the payment bond. Each of
these issues challenge explicit factual findings made by the trial court.4
Standard of Review
An assertion that the evidence is factually insufficient to support a fact finding
means that the evidence supporting the finding is so weak or the evidence to the
contrary is so overwhelming that the answer should be set aside and a new trial
ordered. Garza v. Alviar, 395 S.W.2d 821, 823 (Tex. 1965). In reviewing factual
sufficiency, the reviewing court must consider, examine, and weigh all of the evidence in
the record. Maritime Overseas Corp. v. Ellis, 971 S.W.2d 402, 406-07 (Tex. 1998). In
doing so, the court does not consider the evidence in the light most favorable to the
4
Appellants’ issues challenge the trial court’s following findings of fact:
5. Concept then requested substantial additional work, approximately
equal in scope to the original job. This additional work substantially
increased the preparation necessary, thereby actually exceeding the
quoted scope.
6. Plaintiff [AMS] is an asbestos contractor, and the services provided
involve removal of asbestos contaminated material. The limited scope
quoted could be accomplished with the use of “glove bags” that do not
involve area containment and donning of hazmat suits. The extra work
subsequently requested include removal of carpet, which did require these
additional precautions.
8. Plaintiff’s work benefitted Defendant Concept . . . .
9. Concept accepted the extra work.
12. Asbestos [AMS] dealt directly with Concept, and presented its invoices
stating the basis of its claim for compensation. All notice requirements for
recovery under the payment bond against Defendant Capitol . . . have
occurred or been satisfied.
12
finding; instead, the court considers and weighs all the evidence, and sets aside the
disputed finding only if it is so contrary to the great weight and preponderance of the
evidence as to be clearly wrong and unjust. Id. at 407; Gooch v. American Sling Co.,
902 S.W.2d 181, 184 (Tex.App.--Fort Worth 1995, no writ).
Quantum Meruit Claim
Quantum meruit is an equitable theory of recovery which is based on an implied
agreement to pay for benefits received. Heldenfels Bros., Inc. v. City of Corpus Christi,
832 S.W.2d 39, 41 (Tex. 1992); Iron Mountain Bison Ranch, Inc. v. Easley Trailer Mfg.,
Inc., 42 S.W.3d 149, 159 (Tex.App.—Amarillo 2000, no pet.). To establish a claim for
quantum meruit damages in Texas, a plaintiff must prove that it (1) provided valuable
services or materials, (2) for the benefit of the defendant, (3) that were accepted by the
defendant, and (4) the defendant had reasonable notice that the plaintiff expected
compensation for the services or materials. Heldenfels Bros., Inc., 832 S.W.2d at 41;
Iron Mountain Bison Ranch, 42 S.W.3d at 159-60. Thus, by their sixth through eighth
issues, appellants challenge the factual sufficiency of the evidence supporting the trial
court’s findings of fact that AMS proved the first three elements of its quantum meruit
claim.
Appellants challenge the sufficiency of the evidence proving that the extra work
performed by AMS was a valuable service or material. Appellants’ contention reiterates
their complaints about the evidence addressed in issues three and four, and also
contends that AMS failed to follow appropriate procedures for obtaining approval to
perform the extra work. However, a review of appellants’ argument makes clear that
13
they are not disputing that AMS performed valuable work that was outside the scope of
the contract.5 Rather, appellants’ contention relates to whether AMS is entitled to
payment for the extra work that was performed, and the appropriate amount of value
provided by AMS through its extra work. The record establishes that Scheurer
requested that AMS perform extra work that exceeded the scope of the work that AMS
and Concept initially agreed upon. Further, while there was some dispute regarding
exactly how much extra work was performed and the value of this extra work, there is
no evidence that denies that AMS performed some work that exceeded the scope of the
initial agreements and that this extra work was valuable. Thus, we cannot agree with
appellants’ contention that the evidence was factually insufficient to establish that AMS
provided valuable services or materials to Concept. We overrule appellants’ sixth issue.
Appellants also challenge the factual sufficiency of the second element of AMS’s
quantum meruit claim, that Concept benefited from AMS’s extra work. By this issue,
appellants simply reiterate their contention presented in issue five, that any benefit from
AMS’s extra work flowed to the owner of the property, BW, and not to appellants.
However, as addressed above in analysis of appellants’ fifth issue, the evidence that
Concept requested and benefitted from the extra work performed by AMS is not so
against the great weight and preponderance of the evidence as to be clearly wrong and
unjust. We overrule appellants’ seventh issue.
5
Within their argument of issue six, appellants allege that, “Finding of Fact No. 4
includes a reference to ‘ALC,’ a flaw which is fatal to the elements of the theory of
quantum meruit.” However, this allegation is not explained. As this Court cannot
determine the nature of appellants’ argument, we cannot agree that the trial court’s
reference to ALC is fatal to AMS’s quantum meruit claim. We do, however, note that
the trial court’s finding of fact No. 4 appears to go with Finding of Fact Nos. 2 and 3 to
identify the scope of the work covered by the express contracts.
14
Finally, appellants challenge the sufficiency of the evidence to establish that
Concept accepted the extra work performed by AMS. Appellants contend that the
evidence establishes that, after August 18, 2004, Concept consistently refused to
accept the extra work provided by AMS by limiting payment of invoices to only those
charges attributable to work performed under the initial agreement. Concept contends
that it requested “backup” documentation to support the extra work, and that it conveyed
to AMS that this backup was required before Concept could accept the extra work.
While the record does evidence that Concept stopped paying for extra work after
August of 2004 and that it requested backup documentation to support AMS’s extra
work, the evidence also shows that Scheurer continued to request AMS to perform extra
work after August of 2004 and that the extra work performed by AMS was necessary for
Concept to complete its contract with BW. Thus, while there is some evidence that
appellants did not accept AMS’s work after August 18, 2004, we cannot conclude that
the trial court’s finding that Concept accepted the extra work performed by AMS after
August of 2004 is so against the great weight and preponderance of the evidence as to
be clearly wrong and manifestly unjust. We overrule appellants’ eighth issue.
Payment bond
By their tenth issue, appellants contend that the evidence is factually insufficient
to support the trial court’s judgment against Capitol. Even though the trial court found
that all notice requirements under the payment bond had been satisfied by AMS,
appellants point to the testimony of Mark Gross, Concept’s president and owner, that
AMS failed to provide the requisite notice to assert a claim against the payment bond.
15
AMS responds contending that the terms of the bond except a party in direct contract
with Concept from being required to provide notice of suit. Thus, according to AMS,
there was no notice requirement applicable to AMS, who was in direct contract with
Concept, and the trial court’s finding that all notice requirements have been satisfied is
sufficient as a matter of law.
Reviewing the arguments of appellants in their tenth issue, it is clear that their
factual sufficiency challenge rests on an unstated premise, that the payment bond in
issue has a notice requirement that applies to AMS. A review of the record reveals that
the evidence does establish that AMS did not provide Concept notice of its intent to sue.
The terms of the payment bond provide that, “No suit or action shall be commenced
hereunder by any claimant: . . . unless claimant, other than one having direct contract
with the Principal, shall have given written notice to [Concept] . . . .” This payment bond
is defined by the scope of the work that Concept was to perform in completion of the
project for BW. As previously mentioned, while the extra work performed by AMS is
beyond the terms of the initial agreement between AMS and Concept, the evidence
establishes that AMS’s extra work needed to be performed for Concept to complete the
project. Thus, the extra work was within the general scope of the payment bond. Also,
the evidence establishes that Concept and AMS were in direct contract with regard to
the initial asbestos abatement that Concept consistently acknowledged and accepted.
As such, by the express terms of the payment bond, AMS was excepted from the notice
16
requirement6 and, therefore, the trial court’s finding that all required notice has been
satisfied is supported by the evidence. We overrule appellant’s tenth issue.
Issue 9: Express Contract
Appellants contend that the trial court erred in awarding AMS damages under the
theory of quantum meruit because there are express contracts between AMS and
Concept that generally cover AMS’s provision of asbestos abatement services for the
BW project. AMS responds that the express contracts did not cover the extra work
requested by Concept and performed by AMS and, therefore, recovery under the theory
of quantum meruit is permitted.
The right to recover in quantum meruit is based upon a promise implied by law to
pay for beneficial services rendered and knowingly accepted. Davidson v. Clearman,
391 S.W.2d 48, 50 (Tex. 1965). However, when a valid express contract covers the
services or materials upon which recovery is sought, recovery in quantum meruit will not
be permitted. Truly, 744 S.W.2d at 936. But, the existence of an express contract does
not preclude recovery in quantum meruit for the reasonable value of services rendered
and accepted which are not covered by the contract. Black Lake Pipe Line Co. v. Union
6
We acknowledge that AMS’s quantum meruit claim is, by definition, extra-
contractual. However, the payment bond excepts claimants from providing notice of
claims when in direct contract with Concept. Exceptions to coverage contained within
an insurance policy are to be strictly construed against the insurer and in favor of
coverage, and any intent to exclude coverage must be expressed in clear and
unambiguous language. National Union Fire Ins. Co. of Pittsburgh, Pa. v. Hudson
Energy Co., 811 S.W.2d 552, 555 (Tex. 1991). In the present case, the terms of the
bond allow for a reasonable interpretation exempting AMS from the notice requirement,
and we are therefore compelled to interpret the policy in favor of coverage.
17
Constr. Co., 538 S.W.2d 80, 86 (Tex. 1976), overruled on other grounds by Sterner v.
Marathon Oil Co., 767 S.W.2d 686, 690 (Tex. 1989).
The trial court’s findings of fact make it clear that the extra work exceeded the
scope of the work covered by the express contracts. Specifically, the trial court found
that the work covered by the express contracts could be performed “with the use of
‘glove bags’ that do not involve area containment and donning of hazmat suits.”
However, the extra work that was requested by Scheuerer “included removal of carpet,
which did require these extra precautions.” Appellants’ argument simply states that the
express contracts covered “asbestos abatement to be conducted by Appellee” and that,
because the express contracts covered asbestos abatement, AMS is precluded from
recovery in quantum meruit based on the provision of any asbestos abatement services.
Appellants’ argument, however, wholly fails to address the trial court’s finding that the
scope of the asbestos abatement covered by the express contracts was exceeded by
the extra work as evidenced by the necessity that AMS take the specified extra
precautions. Finding that there is significant evidence in the record to support the trial
court’s finding that the extra work exceeded the scope of the express contracts, we are
bound by the trial court’s factual finding. See McGalliard v. Kuhlmann, 722 S.W.2d 694,
696 (Tex. 1986) (when a finding of fact is unchallenged, it is binding on an appellate
court unless the contrary is established as a matter of law or there is no evidence to
support the finding). Consequently, we overrule appellants’ ninth issue.
18
Issues 11 & 15: Timeliness of Judgment
Appellants contend that the trial court failed to comply with the requirements of
Texas Government Code section 74.059(c)(2),7 when it failed to enter judgment in this
case for more than two and a half years after the date of trial. In their analysis of the
alleged harm caused by this delay, appellants cite Coiner’s conviction for improper
disposal of asbestos.8 AMS responds contending that appellants failed to complain of
the delay in the trial court, and case law requires a showing of how the delay caused
harm before a delay is reversible. AMS contends that appellants fail to show how
Coiner’s conviction caused appellants harm or would necessitate that they be afforded a
new trial.
Our review of the record does not indicate that appellants ever sought to obtain
the trial court’s ruling in this case nor did appellants bring to the trial court’s attention its
failure to comply with Texas Government Code section 74.059(c)(2) at any time before
the trial court rendered its judgment. Following the trial court’s judgment, appellants did
identify this issue in their timely filed motion for new trial. Thus, the issue was
preserved. See TEX. R. APP. P. 33.1(b).
7
Section 74.059(c)(2) provides, “(c) A district, statutory probate, or statutory
county court judge shall: (2) rule on a case within 90 days after the case is taken under
advisement.” TEX. GOV’T CODE ANN. § 74.059(c)(2) (West 2005).
8
Appellants’ issue 15 does not challenge the judgment as being untimely, but
does challenge the trial court’s denial of appellants’ motion for new trial based on
Coiner’s conviction. Since that issue contends that appellants are entitled to a new trial
on the same basis upon which they contend that the trial court’s untimely judgment
caused them harm, we will analyze the issues together.
19
A trial court’s failure to comply with section 74.059(c)(2) is not automatically
reversible error. See Smith v. Montemayor, No. 03-02-00466-CV, 2003 Tex.App.
LEXIS 5099, at *31-*32 (Tex.App.—Austin June 19, 2003, no pet.) (mem. op.). The
complaining party bears the burden of demonstrating that the trial court’s delay in
rendering judgment probably caused the rendition of an improper judgment. Id. at *32.
To meet this burden, appellants contend that they were harmed by the passage
of the three-year period after AMS’s forfeiture of its corporate charter, and by the
intervening federal indictment and conviction of Coiner for improper disposal of
asbestos. However, appellants in no way identify the significance of the passage of
three years after AMS’s forfeiture of its corporate charter nor do they identify how such
an occurrence caused them harm. Similarly, appellants identify that Coiner was
indicted and convicted of improper disposal of asbestos, but make no attempt to explain
to this Court how this conviction impacts the present case. Further, evidence provided
by appellants indicates that Coiner was convicted of negligent release of hazardous air
pollutants, and that the actions upon which this conviction is based occurred after AMS
had completed its work on the BW project. As such, we conclude that appellants have
failed to meet their burden of demonstrating that the trial court’s delay in rendering
judgment probably caused the rendition of an improper judgment. Likewise, we
conclude that appellants have failed to establish that Coiner’s conviction entitles
appellants to a new trial. We overrule appellants’ eleventh and fifteenth issues.
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Issue 12: Waiver and Estoppel
Appellants contend that the evidence established their affirmative defenses of
waiver or estoppel as a matter of law. Appellants’ contention is premised on AMS’s
acceptance of payment for the work covered by the agreements, while Concept refused
to pay for the extra work reflected in the invoices after August of 2004. Appellants
contend that AMS’s silence from August of 2004, when Concept stopped paying for the
extra work, until August of 2005, when AMS filed the present suit, constitutes a waiver
of AMS’s right to recover on the extra work. Alternatively, appellants contend that
AMS’s failure to provide requested documentation to support the extra work performed
prior to trial estops AMS from recovering on the extra work. AMS responds that
Concept’s request for backup documentation on the extra work was disputed and that,
in any event, its failure to provide documentation to support its claim for payment does
not constitute an “intentional relinquishment of a known right.”
Our review of the record reveals that AMS continued to perform extra work for
Concept after Concept stopped paying for the extra work, but that the period of time
during which AMS performed extra work while not being paid was from September of
2004 to April of 2005. This is only a period of eight months. Further, evidence was
presented that Concept had paid for the extra work on the first four invoices. AMS
presented evidence that it continued to perform the extra work beyond this point in good
faith and because it thought that Concept may have been attempting to get change
orders approved by BW which was delaying payment for the extra work. However,
once Coiner determined that Concept was not going to pay AMS for the extra work,
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AMS stopped performing the extra work. Thus, AMS did not take a course of action
inconsistent with claiming a right to payment for extra work for such an extended period
that it can be fairly said that AMS waived its right to payment. See Sun Exploration &
Prod. Co. v. Benton, 728 S.W.2d 35, 37 (Tex. 1987) (waiver requires the intentional
relinquishment of a known right or engaging in intentional conduct inconsistent with
claiming that right).
As to the claim of estoppel, appellants fail to cite to any authority that would
support their contention that a failure to substantiate a claim for payment estops a
person from seeking judicial recourse for the claim. While it was clearly incumbent
upon AMS to establish the value of the services it provided to Concept in order to
recover on its quantum meruit claim, nothing in the law requires that a plaintiff must
establish that value before filing suit and substantiate that value in a manner acceptable
to the benefitted party or else be estopped from asserting a quantum meruit claim.
Finding no evidence to support appellants’ affirmative defenses of waiver or
estoppel, we overrule appellants’ twelfth issue.
Issues 13 & 14: Concept’s Breach of Contract Counterclaim
Appellants contend that they established their counterclaim for breach of contract
as a matter of law and that, as a result, they are entitled to at least $20,080 in actual
damages as well as $25,000 in attorney’s fees. AMS responds that it was Concept that
breached the contract and, therefore, the trial court did not err in denying appellants’
counterclaim. Further, AMS contends that the $5,000 in attorney’s fees attributable to
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the removal of AMS’s mechanic’s lien is being raised for the first time on appeal and is,
therefore, waived.
Appellants premise their contention that they are entitled to recover for their
breach of contract counterclaim on their decision to retain a third-party asbestos
abatement company to complete the contract work on the project that was not
completed by AMS. However, their argument fails to address the uncontroverted
evidence that AMS remained ready to complete the work identified in the agreements
upon being recalled by Concept. However, apparently because AMS ceased
performing the extra work for which it was not being paid, Concept did not recall AMS to
complete the work, but rather chose to retain a third-party to complete the work on the
project. As such, the evidence establishes that it was Concept, not AMS, that breached
the contracts. Thus, we conclude that the trial court did not err in denying appellants’
counterclaim.
Having determined that appellants are not entitled to recover on their breach of
contract counterclaim, their attorney’s fees issue is reduced to appellants’ contention
that AMS stipulated that Concept was entitled to $5,000 in attorney’s fees relating to the
removal of a mechanic’s lien. While the record does reflect that AMS acknowledged an
agreement that $5,000 in attorney’s fees for appellants would be attributable to removal
of the lien, this acknowledgement was part of a pre-trial stipulation that the parties had
agreed “that $25,000 was a reasonable and necessary attorneys’ fee through trial for
each side’s attorney, and agreed that of that sum, with respect to Defendants, $5,000 of
that would be reasonably attributable to the Motion to Remove Mechanic’s Lien . . . .”
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(emphasis added). Looking at the precise language used by AMS, we construe the
agreement to simply indicate that the parties agreed as to what would constitute a
reasonable and necessary attorney fee award, and that this agreement, as it relates to
appellants, has factored in $5,000 for the removal of the lien. Thus, nothing in the
agreement obligated the trial court to make a separate award of attorney’s fees to
appellants relating to the removal of the lien.
Further, appellants cite Texas Property Code section 53.156 as statutory support
for their entitlement to these attorney’s fees. However, section 53.156 permits the trial
court to award costs and reasonable attorney’s fees as would be equitable and just.
TEX. PROP. CODE ANN. § 53.156 (West 2007). Appellants have wholly failed to show
that the trial court abused its discretion by not awarding them $5,000 as attorney’s fees
relating to removal of the mechanic’s lien.
Finally, appellants failed to address the trial court’s award of attorney’s fees in
either their motion for new trial or in their motion for reconsideration of motion for new
trial. Thus, we conclude that appellants failed to bring their construction of the pre-trial
stipulation regarding attorney’s fees to the trial court’s attention and, therefore, have
waived any objection to the trial court’s award. See TEX. R. APP. P. 33.1.
We overrule appellants’ thirteenth and fourteenth issues.
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Conclusion
Having overruled each of appellants’ fifteen issues, we affirm the judgment of the
trial court.
Mackey K. Hancock
Justice
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