CJY Investment, L.L.C. v. United Central Bank ( 2016 )


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  • Affirmed; Opinion Filed June 21, 2016.
    In The
    Court of Appeals
    Fifth District of Texas at Dallas
    No. 05-13-00296-CV
    CJY INVESTMENT, L.L.C., ET AL, Appellants
    V.
    UNITED CENTRAL BANK, ET AL, Appellees
    On Appeal from the 116th Judicial District Court
    Dallas County, Texas
    Trial Court Cause No. DC-11-04102
    MEMORANDUM OPINION
    Before Justices Lang, Brown, and Whitehill
    Opinion by Justice Lang
    Appellants, CJY Investment, L.L.C., Young Hee Chung, and Chun W. Chung, sued
    appellees, James D. Yoo, Ki Na, Chong Na, Chan Chan Investment, L.L.P., Na Family
    Corporation, and United Central Bank for fraud, fraud in the inducement, fraud by
    nondisclosure, bank fraud, and conspiracy. The trial court granted summary judgment for
    appellees.
    Appellants raise four issues on appeal: (1) The trial court erred in granting appellees’ no-
    evidence and traditional motions for summary judgment in light of their failure to respond
    properly to discovery or produce any documents in response to plaintiff’s discovery requests; (2)
    the trial court erred in denying plaintiff’s motion for continuance of the summary judgment
    hearing in light of the need for discovery to adequately respond to summary judgment motions;
    (3) the trial court erred in granting Yoo’s no evidence motion for summary judgment because
    adequate time for discovery had not occurred because of the conduct of the Na defendants 1; and
    (4) the trial court erred in granting Yoo’s motion for traditional summary judgment because
    genuine issues of fact existed on the issue of the running of the statute of limitations and on the
    issue of Yoo’s liability as a conspirator. All issues are decided against appellants. We affirm the
    judgment of the trial court.
    I. FACTUAL AND PROCEDURAL CONTEXT
    In 2006, Chan Chan Investment, L.L.P (“CCI”) “owned” a business known as “Beverage
    Palace.” Ki Na and Chong Na were the “owners” of CCI. At some point during 2006, Ki Na
    “began to search for a buyer” of Beverage Palace and the real property where it was located.
    CCI’s asking price for the business and real property was $4,800,000.
    According to appellants, Ki Na’s real estate broker “introduced him to Chung,”2 who was
    “looking to invest in a business.” They allege that Ki Na provided “Chung” with the financial
    statements of Beverage Palace and a copy of the contract under which CCI purchased “Beverage
    Palace.”3 According to appellants, Na represented to “Chung” that the market price of the real
    property where Beverage Palace was located was $3,500,000.
    In February 2006, “Chung” formed CJY Investment, L.L.C (“CJY”). At that time, CJY
    executed a contract with CCI4 for the purchase of Beverage Palace and the real property.
    Appellants’ allege Ki Na’s real estate broker “introduced Chung” to United Central Bank
    1
    Appellants identify the “Na defendants” as Ki Na, Chong Na, Chan Chan Investment, L.L.P., and Na Family Corporation.
    2
    The record does not reflect whether the person identified as “Chung” is Young Hee Chung, or Chun W. Chung, both of whom are parties
    to this lawsuit.
    3
    The record does not reflect whether these documents contained information pertaining to the business, Beverage Palace, the property
    where Beverage Palace was located, or both.
    4
    The record does not reflect exactly when this contract was executed. The parties contend it was executed in February 2006, and it states
    “The execution of this contract by the first party constitutes an offer to buy or sell the Property. Unless the other party accepts the offer by 5:00
    p.m., in the time zone in which the Property is located, on February 11, 2006 the offer will lapse and become null and void.”
    –2–
    (“UCB”) so that “Chung” could obtain financing. At that time, James D. Yoo was Chairman of
    UCB’s Board of Directors.
    UCB did make two loans to CJY in July 2006 to affect the purchase: one in the amount of
    $2,000,000, and the other in the amount of $1,500,000. The United States Small Business
    Administration guaranteed the $2,000,000 loan pursuant to 15 U.S.C. § 636 (2015). Both loans
    were secured by a first lien deed of trust on the real property and a lien on all the assets of
    Beverage Palace. Additionally, UCB required Chun W. Chung to individually guaranty both
    loans. Appellants allege that in addition to the $3,500,000 provided by UCB, “Chung paid $1.2
    Million . . . for the closing.” “The transaction” closed in July 2006.
    In September 2010, the North Texas Water District sought to purchase an “easement for
    water pipes” on the real property where Beverage Palace was located. According to appellants,
    “CJY requested the value of the property as the purchase price” of the easement. The North
    Texas Water District obtained an appraisal of the property, which appellants allege reflected “the
    market price of the property” to be less than half the property value “represented by Na.”
    On April 1, 2011, Appellants sued appellees for fraud, fraud in the inducement, fraud by
    nondisclosure, bank fraud, and “conspiracy,” alleging appellees agreed to do “any or all of the
    acts” that constituted fraud, fraud in the inducement, fraud by nondisclosure, and bank fraud.
    Appellees filed a general denial answer. On July 30, 2012, the parties filed an agreed motion for
    continuance and extension of discovery deadlines. That motion stated that the case was set for
    trial the week of August 20, 2012, and that:
    [t]he parties have agreed to attempt to settle this cause of action before additional
    time and resources are expended to proceed with the litigation. Because some of
    the parties are organizations that require approvals on terms of settlement by
    company hierarchy, the parties have agreed to continue the trial setting of this
    cause to allow adequate time for settlement negotiations and to proceed with
    discovery should settlement not be reached.
    –3–
    Appellants allege that settlement negotiations “fell through” because UCB refused to agree to
    terms “after several months.” The case was set for trial on January 7, 2013.
    On October 19, 2012, the Na defendants filed a traditional and no-evidence motion for
    summary judgment. On November 8, 2012, UCB filed a no-evidence motion for summary
    judgment. On November 9, 2012, Yoo filed a traditional and no-evidence motion for summary
    judgement. Appellants responded to all three summary judgment motions. Then, appellees
    requested the trial court set the summary judgment motions for a hearing. The trial court set the
    hearing for January 7, 2013, the date of the original trial setting. Pursuant to Texas Rule of Civil
    Procedure 190.3(b)(1)(B)(i),5 the discovery period ended on December 7, 2012, thirty days prior
    to the January 7, 2013 trial setting.
    On December 21, 2012, appellants filed a motion for continuance of the summary
    judgment hearing that stated, in pertinent part:
    Plaintiffs ask the court to grant a continuance so they can collect and
    review the depositions so as to properly respond to the aforementioned motions
    for summary judgment. . . .
    Plaintiffs cannot present by affidavits facts essential to respond to the
    motions and need additional time to secure depositions. As provided in Texas
    Rule of Civil Procedure 166a(g), the court should either grant Plaintiff additional
    time to respond to the motion for summary judgment or deny the motion for
    summary judgment.
    Appellees opposed the motion for continuance. The trial court heard appellants’ motion for
    continuance and the summary judgment motions at one hearing on January 7, 2013, denied the
    5
    That rule states, in pertinent part:
    (b) Limitations. Discovery is subject to the limitations provided elsewhere in these rules and to the following additional limitations:
    (1) Discovery Period. All discovery must be conducted during the discovery period, which begins when suit is filed and continues
    until:
    ...
    (B) in other cases, the earlier of
    (i) 30 days before the date set for trial, or
    (ii) nine months after the earlier of the date of the first oral deposition or the due date of the first response to written discovery.
    –4–
    motion for continuance, and granted summary judgment for all appellees. Appellants timely
    appealed.
    II. STANDARDS OF REVIEW
    “We review a trial court’s grant of summary judgment de novo.” Mid-Century Ins. Co. v.
    Ademaj, 
    243 S.W.3d 618
    , 621 (Tex. 2007). In reviewing a traditional summary judgment in
    favor of a defendant, “we determine whether the defendant conclusively disproved an element of
    the plaintiff’s claim or conclusively proved every element of an affirmative defense.” Smith v.
    Deneve, 
    285 S.W.3d 904
    , 909 (Tex. App.—Dallas 2009, no pet.). A matter is conclusively
    proved if “ordinary minds could not differ as to the conclusion to be drawn from the evidence.”
    Estate of Hendler, 
    316 S.W.3d 703
    , 707 (Tex. App.—Dallas 2010, no pet.).
    In reviewing a no-evidence summary judgment in favor of a defendant, we apply the
    same legal sufficiency standard used to review a directed verdict. See TEX. R. CIV. P. 166(a)(i);
    Gen. Mills Rests., Inc. v. Tex. Wings, Inc., 
    12 S.W.3d 827
    , 832–33 (Tex. App.—Dallas 2000, no
    pet.). We must determine whether the nonmovant produced more than a scintilla of probative
    evidence to raise a fact issue on the material questions presented. Bever Props., L.L.C. v. Jerry
    Huffman Custom Builder, L.L.C., 
    355 S.W.3d 878
    , 885 (Tex. App.—Dallas 2011, no pet.). More
    than a scintilla of evidence exists if the evidence would allow “reasonable and fair-minded
    people to differ in their conclusions.” Ford Motor Co. v. Ridgway, 
    135 S.W.3d 598
    , 601 (Tex.
    2004). “Evidence that is so slight as to make any inference a guess is in legal effect no
    evidence.” 
    Id. In reviewing
    both a traditional and a no-evidence summary judgment, “we take
    evidence favorable to the nonmovant as true, and indulge every reasonable inference and resolve
    every doubt in favor of the nonmovant.” 
    Smith, 285 S.W.3d at 909
    .
    The decision to deny a motion for continuance is reviewed for “a clear abuse of
    discretion.” Joe v. Two Thirty Nine Joint Venture, 
    145 S.W.3d 150
    , 161 (Tex. 2004).
    –5–
    Additionally, this Court reviews the trial court’s determination that there has been an adequate
    time for discovery for an abuse of discretion. Specialty Retailers, Inc. v. Fuqua, 
    29 S.W.3d 140
    ,
    145 (Tex. App.—Houston [14th Dist.] 2000, pet. denied). “A trial court abuses its discretion
    when it reaches a decision so arbitrary and unreasonable as to amount to a clear and prejudicial
    error of law.” 
    Joe, 145 S.W.3d at 161
    .
    III. MOTION FOR CONTINUANCE
    Appellants’ second issue asserts, “the trial court erred denying plaintiff’s motion for
    continuance of the summary judgment hearing in light of the need for discovery to adequately
    respond to summary judgment motions.” Appellants’ third issue argues, “the trial court erred in
    granting Yoo’s no evidence motion for summary judgment because adequate time for discovery
    had not occurred because of the conduct of the Na defendants.” We address these issues together
    as they both address appellants’ claims of need for discovery and inadequate time to conduct
    discovery as grounds for a continuance.
    A. Applicable Law
    A party may move for no-evidence summary judgment “after adequate time for
    discovery.” TEX. R. CIV. P. 166a(i). This rule does not require that discovery has been completed.
    Specialty Retailers, Inc. v. Fuqua, 
    29 S.W.3d 140
    , 145 (Tex. App.—Houston [14th Dist.] 2000,
    pet. denied). “An adequate time for discovery is determined by the nature of the cause of action,
    the nature of the evidence necessary to controvert the no-evidence motion, and the length of time
    the case had been active in the trial court.” 
    Id. Additionally, appellate
    courts consider “the
    following nonexclusive factors when deciding whether a trial court abused its discretion in
    denying a motion for continuance seeking additional time to conduct discovery: the length of
    time the case has been on file, the materiality and purpose of the discovery sought, and whether
    the party seeking the continuance has exercised due diligence to obtain the discovery sought.”
    –6–
    Joe v. Two Thirty Nine Joint Venture, 
    145 S.W.3d 150
    , 161 (Tex. 2004). See BMC Software
    Belgium, N.V. v. Marchand, 
    83 S.W.3d 789
    , 800 (Tex. 2002) (Denying motion for continuance
    of special appearance hearing and concluding seven months was “ample time” for discovery);
    see also Piazza v. Cinemark, USA, Inc., 
    179 S.W.3d 213
    , 216 (Tex. App.—Eastland 2005, pet.
    denied) (affirming summary judgment for defendant and concluding eighteen months was “more
    than ample time to conduct discovery”); see also McClure v. Attebury, 
    20 S.W.3d 722
    , 730 (Tex.
    App.—Amarillo 1999, no pet.) (affirming no-evidence summary judgment for defendant where
    plaintiff had seven months for discovery and did not attempt to initiate discovery during that
    time); see also Draper v. Garcia, 
    793 S.W.2d 296
    , 301–02 (Tex. App.—Houston [14th Dist.]
    1990, no pet.) (affirming summary judgment for defendant because petition had been on file for
    more than a year and this was “ample time” for discovery).
    B. Application of Law to the Facts
    Appellants filed suit on April 1, 2011. After approximately nineteen months, on October
    26, 2012, the Na defendants filed the first motion for summary judgment. Then, on December
    21, 2012, Appellants filed their motion for continuance. That motion states only the following:
    Plaintiffs expect that depositions and further discovery will bring forth additional
    evidence to support their claims against defendants. Specifically, Plaintiffs expect
    to bring forth evidence on the conspiracy between the defendants regarding the
    property in questions. Plaintiffs expect to elicit evidence of agreements between
    Defendants to help the Nas to sell the property in question so that the Nas could
    then take additional loans from United Central Bank to finance a different
    property. Furthermore, Plaintiffs expect to uncover more evidence regarding the
    buyback agreement there within and the fraudulent nature of that agreement.
    Specifically, entering into the agreement and depleting the corporate entity that
    was to buy back the business.
    A party claiming a continuance is necessary in order to conduct discovery must establish
    “the materiality and purpose of the discovery sought.” See 
    Joe, 145 S.W.3d at 161
    . In their
    motion for continuance, appellants did not identify with particularity the evidence they sought.
    –7–
    They made only vague assertions that they expect discovery will “bring forth additional evidence
    to support their claims against defendants.”
    Further, the record reflects, over the approximately nineteen months between when suit
    was filed and the summary judgment motions were filed, appellants did not take any depositions
    of the defendants. Nor, did they take any depositions after the summary judgment motions were
    filed and before the motion for summary judgment hearing took place, a period of approximately
    three months. On this record, we conclude appellants have not demonstrated: (1) there has been
    inadequate time to conduct discovery; (2) their need for discovery; (3) that they “exercised due
    diligence to obtain the discovery sought”; or (4) that the trial court abused its discretion in
    denying the motion for continuance. 
    Id. Appellants’ second
    and third issues are decided against
    them.
    IV. SUMMARY JUDGMENT FOR THE NA DEFENDANTS
    Appellants’ first issue posits, “the trial court erred in granting [the Na Defendants’] no-
    evidence and traditional motion [sic] for summary judgment in light of [the Na Defendants’]
    failure to respond properly to discovery or produce any documents in response to plaintiff’s
    discovery requests.” Appellants elaborate arguing they “could not adequately respond” to the Na
    Defendants’ summary judgment motion because of “deliberate and intentional conduct in
    refusing to properly respond to discovery or produce any documents.” However, appellants do
    not identify any particular requests for discovery to which the Na Defendants did not respond,
    and the record before us does not contain any requests for discovery served by appellants on the
    Na Defendants. The appellants bear the burden “to bring forward the record of the summary
    judgment evidence” to provide an appellate court with “a basis to review [their] claim of harmful
    error.” DeSantis v. Wackenhut Corp., 
    793 S.W.2d 670
    , 689 (Tex. 1990). If pertinent summary
    judgment evidence considered by the trial court is not included in the appellate record, “an
    –8–
    appellate court must presume that the omitted evidence supports the trial court’s judgment.” 
    Id. On this
    record, we cannot say the trial court erred. Appellants’ first issue is decided against them.
    IV. STATUTE OF LIMITATIONS AND CONSPIRACY
    Appellants’ fourth issue asserts the trial court erred in granting Yoo’s motion for
    traditional summary judgment because a “genuine issue of fact exists on the issue of the running
    of the Statute of Limitations and because a genuine issue of fact exists on Yoo’s liability as a
    conspirator.” The record reflects that in the trial court, appellees contended pursuant to
    applicable statutes of limitations, appellants’ conspiracy claim “expired” in 2008 and appellants’
    fraud claims “expired” in 2010. However, appellants asserted the statutes of limitations have not
    barred their claims because appellants “had no reason to know of the nature of the injury until
    May of 2011.”
    In their brief filed in this Court, appellants contend they “produced numerous documents
    through their response to Yoo’s summary judgment motions giving rise to an inference that the
    Defendants fraudulently concealed their wrongful conduct.” They argue further, “a genuine issue
    of fact existed on Yoo’s affirmative defense of the running of the Statute of Limitations.”
    However, appellants do not describe the documents they say they “produced” in their response to
    Yoo’s motion for summary judgment. Nor, have appellants explained how any such vaguely
    referenced documents create a fact issue as to whether the statutes of limitations barred their
    claims. As described above, the appellants bear the burden “to bring forward the record of the
    summary judgment evidence” to provide an appellate court with “a basis to review [their] claim
    of harmful error.” DeSantis v. Wackenhut Corp., 
    793 S.W.2d 670
    , 689 (Tex. 1990). If pertinent
    summary judgment evidence considered by the trial court is not included in the appellate record,
    “an appellate court must presume that the omitted evidence supports the trial court’s judgment.”
    –9–
    
    Id. Appellants have
    not specified how any of their summary judgment evidence creates a fact
    issue.
    As to the second part of appellants’ issue pertaining to their civil conspiracy claim,
    appellants assert:
    A defendant’s liability for conspiracy depends on participation in some
    underlying tort for which the plaintiff seeks to hold at least one of the named
    defendants liable. Even if the Trial Court finds that Yoo made no representations
    and no conduct of Yoo directly caused the damages of Appellants, if any of the
    Na Defendants are found to be liable, the conspiracy claim can be asserted against
    Yoo since the Na Defendants are also defendants in the cause. As such, the court
    erred in granting Yoo’s Traditional Summary Judgment.
    This argument fails to identify any document or other evidence appellants produced in response
    to Yoo’s motion for summary judgment that shows a fact issue was raised as to whether any
    defendant made a misrepresentation. As with appellants’ earlier arguments, appellants have not
    identified their summary judgment evidence or how such vaguely referenced evidence creates a
    fact issue. See 
    id. We decide
    this issue against appellants.
    V. CONCLUSION
    The judgment of the trial court is affirmed.
    /Douglas S. Lang/
    DOUGLAS S. LANG
    JUSTICE
    130296F.P05
    –10–
    Court of Appeals
    Fifth District of Texas at Dallas
    JUDGMENT
    CJY INVESTMENT, L.L.C., ET AL,                         On Appeal from the 116th Judicial District
    Appellants                                             Court, Dallas County, Texas
    Trial Court Cause No. DC-11-04102.
    No. 05-13-00296-CV         V.                          Opinion delivered by Justice Lang. Justices
    Brown and Whitehill participating.
    UNITED CENTRAL BANK, ET AL,
    Appellees
    In accordance with this Court’s opinion of this date, the judgment of the trial court is
    AFFIRMED.
    It is ORDERED that appellees UNITED CENTRAL BANK, ET AL recover their costs
    of this appeal from appellants CJY INVESTMENT, L.L.C., ET AL.
    Judgment entered this 21st day of June, 2016.
    –11–