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ACCEPTED 13-15-00452-CV THIRTEENTH COURT OF APPEALS CORPUS CHRISTI, TEXAS 10/13/2015 10:43:12 AM Dorian E. Ramirez CLERK NO. 13-15-00452- CV IN THE THIRTEENTH COURT OF APPEALS FILED IN 13th COURT OF APPEALS CORPUS CHRISTI-EDINBURG, TEXAS CORPUS CHRISTI/EDINBURG, TEXAS __________________________________________________________________ 10/13/2015 10:43:12 AM DORIAN E. RAMIREZ SANDEEP PATEL, Clerk Appellant v. HARBOR HOSPICE OF BEAUMONT, L.P., ET AL, Appellees __________________________________________________________________ 172nd Judicial District Court of Jefferson County, Texas On Appeal from the 172nd Trial Court Cause No. E-192,576 The Honorable Donald J. Floyd, Presiding __________________________________________________________________ BRIEF OF APPELLANT __________________________________________________________________ PORTNER ♦ PORTNER ♦BBoND, PLLC OND, PLLC Chris M. Portner State Bar No. 24007858 cportner@portnerbond.com J. Trenton Bond State Bar No. 00785707 tbond@portnerbond.com 1905 Calder Avenue Beaumont, Texas 77701 Telephone: (409) 838-4444 (409) 554-0240 Facsimile: (409) COUNSEL COUNSEL FOR AAPPELLANT, PPELLANT, SANDEEP S PATEL ANDEEP PATEL ORAL ARGUMENT REQUESTED IDENTITY OF PARTIES AND COUNSEL APPELLANT Sandeep Patel APPELLANT’S COUNSEL(S) APPELLANT'S Chris M. Portner State Bar No.: 24007858 cportner@portnerbond.com J. Trenton Bond State Bar No.: 00785707 tbond@portnerbond.com P ORTNER ♦ PORTNER ♦ BOND, BOND, PLLC PLLC 1905 Calder Avenue Beaumont, Texas 77701 Telephone: (409) 838-4444 (409) 554-0240 Facsimile: (409) 554-0240 Anthony Malley, III State Bar No.: 24041382 tony@mallaw.com MALLEY LLAW MALLEY AW FFIRM, IRM, PLLC PLLC 905 Orleans, Suite 110 Beaumont, Texas 77701 Telephone: (409) 212-8888 (409) 212-8002 Facsimile: (409) 212-8002 Jamie Matuska MATUSKA L MATUSKA AW F LAW FIRM IRM State Bar No.: 24051062 jamie@matuskalaw.com 2809 Highway 69 North Nederland, Texas 77627 Telephone: (409) 722-5600 (409) 727-1290 Facsimile: (409) 727-1290 ii APPELLEE(S) Beaumont, L.P. Harbor Hospice of Beaumont, L.P. Harbor Hospice Managers, LLC Arfeen Properties, L.P. Qamar Arfeen APPELLEES COUNSEL(S) David Gaultney State Bar No.: 07765300 davidgaultney@mehaffyweber.com MEHAFFYWEBER, P.C. MEHAFFYWEBER, P.C. 823 Congress Avenue, Suite 200 Austin, Texas 78701 Telephone: (512) 394-3840 (512) 394-3860 Facsimile: (512) David E. Bernsen State Bar No.: 02217500 dbernsen@bernsenlaw.com Christine L. Stetson State Bar No.: 00785047 cstetson@bernsenlaw.com BERNSEN L BERNSEN AW F LAW FIRM IRM 420 North MLK, Jr., Pkwy Beaumont, Texas 77701 Telephone: (409) 212-9994 (409) 212-9411 Facsimile: (409) 212-9411 Glen W. Morgan State Bar No.: 14438900 gmorgan@rmqlawfirm.com John Werner State Bar No.: 00789720 jwerner@rmqlawfirrn.com jwerner@rmqlawfirm.com REAUD, R MORGAN EAUD, M ORGAN & &QQUINN, LLP UINN, LLP P.O. Box 26005 Beaumont, Texas 77720-6005 Telephone: (409) 838-1000 (409) 833-8236 Facsimile: (409) ii TRIAL COURT Honorable Donald J. Floyd Judge Presiding 172nd Civil District Court Jefferson County Courthouse 1001 Pearl Street Beaumont, Texas 77701 Telephone: (409) 835-8485 iii TABLE OF CONTENTS IDENTITY OF PARTIES AND COUNSEL ..............................................................ii TABLE OF CONTENTS...........................................................................................iv CONTENTS iv INDEX OF AUTHORITIES.....................................................................................vii AUTHORITIES vii CASE STATEMENT OF THE CASE................................................................................... x PRESENTED...............................................................................................xi ISSUES PRESENTED xi STATEMENT OF FACTS ......................................................................................... 1 SUMMARY OF ARGUMENT ................................................................................ 12 ARGUMENT ............................................................................................................ 15 I. The TheTrial TrialCourt CourtErred ErredininGranting GrantingAppellees' Appellees’Amended Amended Motion for Summary Judgment ................................................................ ……...15 ..15 ISSUE ONE: A. ISSUE ONE: Appellees Appellees Did Did Not Not Establish a Statute of Limitations Defense as a Matter of Law ............................... 16 1. Summary 1. Judgment Evidence Summary Judgment Evidence Establishes Establishes Patel Patel Partner in Harbor Was a Partner Harbor Hospice Hospice After June 15, 2008 ......................................................................................... ……...18 ..18 2. Appellees Failed to Establish As a Matter of Law That Patel That Patel Was Was No Longer Longer a Partner Partner inin Harbor Harbor Hospice On or Before June 15, 2008 2008................................ ……...20 ..20 a. The a. The Parker Parker Letter Letter does does not not terminate terminate Patel’s limited Patel's limited partnership interest interest.............................. ……...20 20 b. Amendment 4 to the partnership agreement was executed on November 10, 2011........................... 2011 ……...22 ..22 c. c. Undated Amendment 4 No. 4 ................................... 22 iv iv Appellees failed d. Appellees failed to to establish establish as as a Matter of Law that Patel knew or should have known of any injury on or before June 15, 2008 2008..................... …..….23 23 e. e. Patel never testified Patel never testified that that his his limited limited partnership interest partnership interest was was terminated, terminated, redeemed or redeemed transferred to or transferred to Defendant Defendant Arfeen Arfeen................................................................ .24 ……...24 3. Appellees 3. Appellees Failed Failed to to Establish Establish as as aa Matter Matter of Law that Patel's Law that Patel’s Cause Cause of of Action Action for for Conversion Conversionand and Under Under the the Texas Texas Theft Theft Liability Liability Act Act Accrued Accrued on on or Before Before June 15, 2010 ................................................................................... ……...24 ..24 Appellees Failed 4. Appellees Failed to to Conclusively Conclusively Establish Establish Discovery Rule that Patel Knew or Under the Discovery Reasonably Reasonably Should Should Have Have Known That His Known That His Interest Was Terminated by June 15, 2008........................ 2008 …...…26 ........26 5. Appellees Failed 5. Appellees Failed to to Conclusively Conclusively Negate Negate Patel’s Affirmative Defense Patel's Affirmative Defense of of Fraudulent Fraudulent Concealment ................................................................ ……...31 ..31 ISSUE TWO: B. ISSUE TWO: The Trial Trial Court Court Erred Erred in in Concluding Concluding that No Genuine that Genuine Issue Issue of Material Material Fact Exists Exists on on Any of Patel’s Claims................................................... Patel's Asserted Claims ……...32 ..32 1. The 1. trial court The trial court erred erred iningranting granting summary summary judgment regarding judgment regarding Patel’s breach of Patel's breach of fiduciary fiduciary duty claims duty claims because because the the summary summary judgment judgment evidence raises questions of material fact ...............…..….33 33 2. The trial court The trial court erred erred iningranting granting summary summary judgment regarding judgment regarding Patel’s breach of Patel's breach of contract contract claim because the claim because the summary summary judgment judgment evidence evidence raises questions of material fact................................ fact ……...36 ..36 v 3. The 3. trial court The trial court erred erred iningranting granting summarysummary judgment regarding judgment regarding Patel's Patel’s conversion conversion claim claim because the summary because summary judgment judgment evidence evidence raises raises questions of material fact................................ fact ........................ ……...37 ..37 4. The trial court The trial court errederred iningranting granting summarysummary judgment regarding regarding Patel’sPatel's claim for Texas Theft Liability Liability Act violations because Act violations because the the summary summary judgment evidence judgment evidence raises raises questions questions of material material fact .......................................................................................... ……...38 38 5. 5. The trial court The trial court erred erred iningranting granting summary summary judgment regarding judgment regardingPatel’s Patel's claim for fraud claim for fraud because Appellees because Appellees did not seek did not seek summary summary judgment regarding Patel’s claim................................ Patel's fraud claim ……...40
40 Cow. C. ISSUE THREE: The Trial Court Erred in Concluding Appellees Conclusively Appellees Conclusively Established Established that that Patel Patel Did Did Not Suffer Damages ................................................................ ……...40 40 D. ISSUE ISSUE FOUR: FOUR: The The Trial Trial Court Court ErredErred in in Granting Granting Summary Summary Judgment Judgment Because Because Appellee’s Appellee's Failed Failed to Authenticate Any Authenticate Any of Their Their Summary Summary Judgment Judgment Evidence................................................................ Evidence ....................... ……...43 43 E. CONCLUSION and PRAYER for RELIEF ....................................................... 44 CERTIFICATE OF SERVICE ................................................................................. 46 CERTIFICATE OF COMPLIANCE, TEX. R. APP. PROC. 9.4(1)(3) ................... 47 APPENDIX June 18, 2015 Order on Defendants’ Defendants' Amended Motion for Summary Judgment.................................................................................................. Judgment 1AB TAB A vi vi INDEX OF AUTHORITIES CASES Alaniz v. Hoyt, 330, 344
105 S.W.3d 330, 344 (Tex. (Tex. App. App.—– Corpus Corpus Christi Christi 2003, 2003, not pet.)...............15 pet.) 15 Aquaplex, Inc. v. Rancho La Valencia, Inc., 42
297 S.W.3d 768, 775-776 (Tex. 2009)..........................................................42 2009) Blanche v. First Nationwide Mortg. Corp.
74 S.W.3d 444, 451 (Tex. App. Dallas 2002) ..............................................44 44 Bliss v. NRG Industries, S.W.3d 434
162 S.W.3d 434(Tex. (Tex. App. App.—– Dallas Dallas 2005, 2005, pet. pet. denied) ..............................15 15 BP America Prod. Co. v. Marshall,
342 S.W.3d 59, 67-69 (Tex. 2011) ................................................................31 31 Dernick Resources, Inc. v. Wilstein, st
312 S.W.3d 864, 878 (Tex. App.—Houston [1 [1St Dist.] 2009, no pet.)..........31 pet.) 31 Doe v. Boys Club of Greater Dallas, Inc.,
907 S.W.2d 472, 476-77 (Tex. 1995)............................................................16 1995) 16 Friendswood Dev. Co. v. McDade & Co.,
926 S.W.2d 280, 282 (Tex. 1996) .................................................................15 15 Gaddis v. Smith,
417 S.W.2d 577, 578 (Tex. 1977) .................................................................26 26 G&H Towing Co. v. Magee,
347 S.W.3d 293, 297 (Tex. 2011) .................................................................40 40 Graham Morg. Morg. Corp. Corp. v. v. Hall, Hag
307 S.W.3d 472, 479 (Tex. App. - Dallas 2010, no pet)...............................33 pet) 33 Groves v. Hanks,
546 S.W.2d 638, 647 (Tex. Civ. App. Corpus Christi 1976)........................42 1976) 42 vii vii Haas v. George,
71 S.W.3d 904, 913 (Tex. App.—Texarkana 2002, no pet.) ........................32 32 Mann Frankfort Stein & Lipp Advisors, Inc. v. Fielding,
289 S.W.3d 844, 848 (Tex. 2009) .................................................................15 15 Messner v. Boon, 2015 Tex. App. LEXIS 747, *30 (Tex. App. Texarkana Jan. 28, 2015) ......17 17 Moreno v. Sterling Drug, Inc.,
787 S.W.2d 348, 351 (Tex. 1990) .................................................................26 26 Nautilus Training Center No. 2, Inc. v. Seafirst Leasing Corp.,
647 S.W.2d 344, 344, 346-47 346-47 (Tex. (Tex. App. App.—– Corpus Corpus Christi Christi 1982, 1982, no writ)..........16 writ) 16 Qaddura v. Indo-European Foods, Inc. Inc,,
141 S.W.3d 882, 888-890 (Tex. App. Dallas 2004)......................................41 2004) 41 Punts v. Wilson,
137 S.W.3d 889, 891 (Tex. App. Texarkana 2004) ......................................42 42 Rhone-Poulenc, Inc. v. Steel,
997 S.W.2d 217, 223 (1999)..........................................................................16 (1999) 16 Santanna Natural Gas v. Hamon Operations,
954 S.W.2d 885, 890-891 (Tex. App.—Austin 1997, pet. denied).........17, denied) 17, 31 Schneider Nat’l Carriers, Inc. v. Bates, Nat'l Carriers,
147 S.W.3d 264, 279 (Tex. 2004) .................................................................21 21 Shell Oil Co. v. Ross,
356 S.W.3d 924, 927 (Tex. 2011) .................................................................31 31 S.V. v. R.V., 26, 27
933 S.W.2d 1, 4 (Tex. 1996) ...................................................................26, Willis v. Maverick,
760 S.W.2d 642, 646 (Tex. 1988) .................................................................26 26 viii viii RULES Tex. R. Civ. P. 166a .................................................................................................15 15 Tex. R. Civ. P. 166a(c) ............................................................................................15 15 ix ix STATEMENT OF THE CASE This is an This an appeal appeal by by Plaintiff Plaintiff Sandeep Sandeep Patel ("Patel") ("Patel") from motion for from a motion summary judgment granted in favor of Appellees, disposing of all of Patel's claims against Appellees against Appellees in in a lawsuit for fraud, fraud, breach breach of contract, contract, breach breach of of fiduciary fiduciary duty, conversion, duty, conversion, for for violations violationsofof the Texas Theft the Texas Theft Liability Liability Act, and for Act, and for declaratory relief. xx ISSUES PRESENTED 1. 1. Issue One: The Thetrial trialcourt courterred erredin ingranting granting summary summary judgment judgment based upon Appellees’ affirmative Appellees' affirmative defense defense of statute of limitations because the summary judgment evidence raises questions of material fact. 2. Issue Two: Two: TheThetrial trialcourt courterred errediningranting grantingsummary summary judgment judgment upon all Appellees’ alleged Appellees' alleged causes causes of of action action because the summary judgment evidence raises questions of material fact regarding the merits of each alleged claim. a. a. The trial court erred in granting granting summary summary judgment judgment regarding Patel's breach of fiduciary breach fiduciary duty duty claim claim because because the the summary summary judgment judgment evidence raises questions of material fact. b. The trial court erred in granting granting summary summary judgment judgment regarding Patel's breach of contract breach contract claim claim because because the the summary summary judgment judgment evidence evidence raises questions of material fact. c. c. The trial court erred in granting granting summary summary judgment judgment regarding Patel's conversion conversion claim because the summary claim because summary judgment judgment evidence evidence raises raises questions of material fact. d. The trial court erred in granting granting summary summary judgment judgment regarding Patel's violations of the Texas Theft Liability Act claim because the summary judgment evidence raises questions of material fact. e. e. The trial court erred in granting granting summary summary judgment judgment regarding Patel's claim fraud because claim for fraud because Appellees Appellees did not not seek seek summary summary judgment judgment regarding Patel’s Patel's fraud claim. 6. Issue Three: Three: The Thetrial trialcourt courterred errediningranting grantingsummary summary judgment judgment and and finding finding that that Patel did not not suffer suffer damages damages because because the the summary summary judgment judgment evidence raises questions of material fact. 7. Issue Four: TheThetrial trialcourt courterred errediningranting grantingsummary summary judgment judgment because because Appellees' failed to authenticate any of their summary judgment evidence. xi xi STATEMENT OF FACTS Patel and Qamar Arfeen ("Arfeen") were limited partners in Harbor Hospice of Beaumont, LP of Beaumont, LP ("Harbor ("HarborHospice"). Hospice"). (C.R. (C.R. 42-88). The general 42-88). The general partner partner of Harbor Hospice Harbor Hospice is is Harbor Harbor Hospice Hospice Managers, Managers,LLC. 87, 126-129, LLC. (C.R. 84, 87, 126-129, 135- 140, 171-203). Patel received a 3% Class A Limited Partnership Interest in Harbor Hospice of Beaumont, Beaumont, LP LP in in 2005. 83). Several 2005. (C.R. 79, 83) Severalamendments amendments were were allegedly allegedly then made to the made the Harbor Harbor Hospice Hospice Limited Limited Partnership Partnership Agreement Agreement (the (the "Partnership “Partnership Agreement”). (C.R. Agreement"). (C.R. 126 126 - 129, 135- 135- 140, 140, 171 171 - 203). 203). Patel's Patel's Class Class A A Limited Limited Partnership Partnership Interest Interest in Harbor Hospice Hospice was increased increased to 6% in Amendment No. 2 to Agreement of Limited Partnership Partnership of of Harbor Harbor Hospice. Hospice. (C.R. 176-180). Appellees' decided At some point, the Appellees' decided to implement aa plan to implement Arfeen to plan for Arfeen improperly take improperly possession of take possession Patel's limited of Patel's limited partnership partnership interest interest in Harbor Harbor Hospice. Appellees' Hospice. Appellees' had had several several options options about about how how to try to take take possession possession of Patel's Patel's limited limited partnership partnership interest. First of interest. First of all, all, Harbor Harbor Hospice Hospice could could attempt to terminate Patel’s terminate limited partnership Patel's limited partnership interest interest for alleged alleged wrongful wrongful conduct conduct and forfeit forfeit the limited partnership the limited partnership interest interestback backto to the the partnership. If this partnership. If this occurred, occurred, Patel's limited limited partnership partnership interest interest would would be be returned returned to to the the partnership partnership and and all all of partners would the partners would benefit benefit on on a pro-rata pro-rata basis. Secondly, Harbor basis. Secondly, Harbor Hospice Hospice could could attempt to attempt redeem Patel’s to redeem Patel's interest. interest. IfIfthis thisoccurred, occurred, Patel's Patel's interest interest would would be 1 1 returned to the partnership and all of the partners would benefit on a pro-rata basis. Finally, Arfeen Finally, Arfeen could could seek seek to acquire Patel's to acquire Patel’s interest interest directly directly from from Patel Patel and and transfer the transfer shares to the shares Arfeen. However, to Arfeen. However, ififArfeen Arfeen acquired acquired Patel's Patel’s limited limited partnership interest partnership interestdirectly, directly,he hewould wouldhave havetoto pay pay Patel Patel the the fair value for the fair value shares. Apparently, none Apparently, none of of these these options options were were appealing appealing to to Arfeen. Therefore, Arfeen. Therefore, instead of complying the terms of the Partnership Agreement, Appellees decided to wrongfully transfer wrongfully transfer Patel’s Patel's limited limited partnership partnership interest interest to to Arfeen, Arfeen, to Patel to pay Patel nothing, to not inform Patel that the transfer occurred, and to ultimately create false documents in an effort to conceal this improper transaction. Arfeen Wrongfully Took Possession of Patel’s Patel's Limited Partnership Interest Appellees’ Amended In Appellees' Amended Motion Motion for for Summary Summary Judgment, Judgment, Appellees' Appellees' assert assert Patel’s Limited that Patel's Limited Partnership Partnership Interest was terminated terminated or redeemed redeemed by Harbor Harbor Hospice. However, Hospice. However, in in reality, reality, Patel's Patel’s Limited Limited Partnership Partnership Interest Interest was was not not redeemed, terminated redeemed, terminated or or otherwise otherwise returned returnedto to Harbor HarborHospice Hospiceininany anymanner. manner. It was improperly improperly transferred transferred directly directly to to Arfeen. This improper Arfeen. This improper transfer transfer was made made without consideration without considerationand and without withoutever ever informing informingPatel. Appellees failed Patel. Appellees failed to produce summary judgment evidence demonstrating demonstrating that that Patel was ever informed limited partnership that his limited partnership interest in Harbor Hospice was transferred directly to Arfeen. 22 The Harbor The Harbor Hospice Hospice General General Ledger Ledger for the year for the year 2009 2009conclusively conclusively establishes establishes that Patel’s limited that Patel's limited partnership partnership interest interest was transferred transferred directly directly to (C.R. 204 Arfeen. (C.R. 204 -- 206). The The2009 2009 General General Ledger Ledger states: 01/01/09 “Transfer of "Transfer 2008 partnership of 2008 partnership interest interest from from Chaudhury & Chaudhury Patel to & Patel to Arfeed'. Arfeen”. (C.R. (C.R. 204 204 -- 205) 205) (“emphasis added”). ("emphasis added'). Clearly, Clearly, if Patel's Patel’s limited limited partnership partnership interest interest was was transferred transferred directly directly to Arfeen, then Patel's Arfeen, Patel’s limited limited partnership partnership interest could not have have been been terminated, terminated, forfeited, or redeemed. The transfer of Patel's Patel’s limited limited partnership partnership interest is explained in an e-mail dated April 6, 2009 from Harbor Hospice’s Hospice's accountant, Monica Surratt: Paul pointed out Paul pointed out that that Sandeep Sandeep Patel Patel && Trip Trip Chaudhury Chaudhury were were included in the Due from from Partners Partners account. account. Since both of them are out as of 1/1/08, what should I do with these balances? Since partnership did Since the partnership did not interest back not buy their interest back (it was transferred to Qamar instead of re-allocated among the other transferred then any partners), then anypurchase/payment purchase/payment should should have have happened happened outside of the the partnership. partnership. (C.R. 207)(“emphasis 207)("emphasis added”). added'). After the direct After direct transfer transfer of Patel's Patel’s limited limited partnership partnership interest interest to to Arfeen, Arfeen, Harbor Hospice Harbor Hospice filed filed Form Form 8308, 8308, Report Report of of aa Sale Sale or or Exchange Exchange of of Certain Certain Partnership Partnership Interests Interests(“Form ("Form8308”) 8308")with with the the Internal Internal Revenue RevenueService. (C.R. Service. (C.R. 208). Form 208). Form 8308 8308 was was filed filed with with the the Internal Internal Revenue Revenue Service Service on April 7, 2009. 2009. (C.R. 209). In InForm Form 8308, 8308, Harbor Harbor Hospice Hospice informed informed the Internal Internal Revenue Service, 3 3 under penalty of perjury, that Patel’s Patel's limited partnership interest in Harbor Hospice was transferred directly directly to to Arfeen. 208). Arfeen. (C.R. 208) These documents These documents clearly clearly establish establish that Patel’s limited that Patel's limited partnership partnership interest interest transferred directly was transferred directly from from Patel Patel to to Arfeen. Unfortunately, the Appellees Arfeen. Unfortunately, Appellees never informed Patel informed Patel that that his his interest interest was was transferred transferredtoto Arfeen. This is Arfeen. This is not not disputed. disputed. Ultimately, Arfeen Ultimately, Arfeen transferred transferred Patel's Patel's limited partnership interest limited partnership interest in Harbor Harbor Hospice to Arfeen Arfeen Properties, Properties, LP. LP. (C.R. 193-198). There There is is no no summary summary judgment evidence evidence suggesting suggesting that that Patel Patel was informed that was ever informed that his his limited limited partnership partnership interest was transferred to Arfeen and then to Arfeen Properties, LP. Patel's Limited Partnership Interest in Harbor Hospice Was Never Terminated Section 10.2 of the Harbor Hospice Partnership Agreement provides: All All ofof the thegeneral generalpartners partners maymayunanimously unanimously terminate terminate the the interest of a limited partner and expel him(a) for interfering in the management of management the partnership of the partnership affairs affairs or otherwise otherwise engaging engaging in conduct which could result in the partnership losing losing its tax status as a partnership, (b) partnership, (b)ifif the conduct of the conduct of aa limited limited partner partner brings brings the the partnership into disrepute, or (c) for failing to meet any commitment the partnership to the partnership or manager manager in in accordance accordance with any any written written undertaking signed undertaking signed by by such limited partner, such limited partner, butbut thethe general general partners shall partners shall not not be required required to so so terminate. terminate. In In each each of of the the foregoing foregoing events, events, the the expulsion expulsion andand termination termination may,may, in the sole in the sole discretion of discretion of the general partners the general partners in order to in order to compensate compensate for for any any damages caused damages causedto to the partnership, result the partnership, resultinin aa forfeiture forfeiture to the to the partnership of partnership of all or a portion portion of the the value value of of the the partnership partnership interest interest of the expelled expelled partner at the timetime ofof such such expulsion expulsion or or termination. termination. (C.R. 62)(“emphasis 62)("emphasis added”). added"). 4 4 There is no There no summary summary judgment judgment evidence evidence to establish establish that the the general general partners of Harbor Hospice unanimously unanimously terminated terminated Patel’s Patel's interest as required by Section 10.2 of the Harbor Harbor Hospice Hospice Partnership Partnership Agreement. Agreement. The general partner of Harbor Hospice Harbor Hospice is is Harbor Harbor Hospice Hospice Managers, Managers,LLC. 87, 126-129, LLC. (C.R. 84, 87, 126-129, 135- 140, 171-203). 140, 171-203). There There isisno nosummary summaryjudgment judgment evidence evidence that that Harbor Harbor Hospice Hospice Managers, LLC ever took any action to terminate the interest of Patel. Furthermore, there Furthermore, there is summary judgment is no summary judgment evidence evidence to establish establish that that Patel’s Limited Partnership Patel's Limited Partnership Interest Interest in in Harbor Harbor Hospice Hospice was was ever ever terminated. terminated. No witness testimony witness testimony alleges alleges Patel’s limited partnership Patel's limited partnership interest interest in Harbor Harbor Hospice Hospice was ever terminated. was terminated. No Nodocument document establishes establishes that that Patel's Patel’s limited limited partnership partnership interest in interest Harbor Hospice in Harbor Hospice was ever terminated. was ever terminated. The The only only summary summary judgment judgment evidence evidence that that even even mentions mentions termination termination isis aa letter letter dated dated March March 4, 2008 to Patel from Maggie Parker (the “Parker "Parker Letter”). 121-125).1 (C.R. 121-125)1 Letter"). (C.R. When presented with a copy of this letter in his deposition and a copy of the green card green card showing showing his wife’s signature his wife's signature evidencing evidencing receipt receipt of letter, Patel of the letter, Patel acknowledged his acknowledged his wife’s signature and wife's signature receipt as evidenced and receipt evidenced by the the documents. documents. (C.R. 94-95). However, Patel 94-95). However, Patel did did not not recall recall seeing seeing the the letter letter or whether whether his wife brought the letter to his brought his attention; attention; he further further testified testified that his wife wife handled handled their '1 The Parker Letter attached to Defendants' Amended Motion for Summary Judgment is missing second page. the second However, the page. However, the full full letter letter isis in inthe theDefendant's Defendant’s original original motion motion for for summary summary judgment filed as a supplemental clerk’s clerk's record in this Court. 55 financials and that he was certain that his wife or his accountant would have taken care care of after receiving of it after receiving the the letter. (C.R. 97, letter. (C.R. 97, 98). 98). Appellees Appellees presented presented no no summary judgment evidence conclusively conclusively establishing establishing that that Patel Patel failed to comply with Parker’s financials.2 request for financials Parker's request Additionally, Appellees Additionally, Appellees presented presented no summary judgment no summary judgment evidence evidence that that Harbor Hospice’s Hospice's general partner took any action against Patel’s Patel's interest as a result of any alleged noncompliance noncompliance with with the the letter. Although the letter. Although the Parker Parker Letter Letter clearly clearly threatens termination threatens terminationifif certain certain conduct conductdid did not not occur, occur, itit does does not provide provide any evidence evidence whatsoever whatsoever that that the termination actually the termination actually occurred. Furthermore, the occurred. Furthermore, Parker Parker letter letter does provide any evidence does not provide evidence that the general general partner partner of Harbor Harbor Hospice unanimously Hospice unanimouslyterminated terminatedthe theinterest interestofofPatel Pateland andexpelled expelledhim. The him. The Parker Parker Letter Letter was was aa threat threat and and nothing nothing more. There isisno more. There nosummary summary judgment judgment evidence evidence that that the general partner the general partner took took any any action action to to terminate terminate Patel's Patel's limited limited partnership interest and expel him after the Parker Letter. Patels' Limited Partnership Interest in Harbor Hospice Was Never Redeemed Section 8.5 provides: (a) The partnership partnership interests interests of of all limited limited partners partners are subject subject to redemption redemption by the partnership by the partnership at at the the election election of of the the general general partners. In the event In the event the the general general partners partners make make such such an an 2 2 only arguably The only arguably controverting controverting evidence evidence that Appellees Appellees submitted submitted was was the the inconclusive inconclusive deposition testimony deposition testimony of of Joe Joe Chapman Chapman wherein wherein hehe testified testified that that he he was aware there were some issues with issues getting partners with getting partners to provide financials to provide financialstoto the bank prior the bank prior to the the refinance, refinance, and and speculated, but could not say for certain, certain, that that Patel Patel failed failed to to provide provide financials. financials. (C.R. 117) 6 6 election, the general partners shall provide the limited partner partnership interest whose partnership interest is to be be redeemed redeemed (the (the "Redeemed “Redeemed Partner”) with Partner") with aa least least sixty days’ prior written sixty days' written notice notice of the redemption. (b) The purchase price of the Redeemed (b)The Redeemed Partner’s Partner's LPI shall equal the balance of the balance the Redeemed Redeemed Partner's Partner’s capital capital account account established established under Section 5.1 hereof, determined determined as of the end of the calendar month month immediately preceding the immediately preceding the month month inin which which the the closing closing of redemption transaction the redemption transactiontakes takesplace. (C.R. 57-58)(“ place. (C.R. emphasis 57-58)(tmphasis added”). added"). The summary The summary judgment judgment record record establishes establishes that that the general partners the general partners failed failed to provide sixty days days prior written written notice notice of of redemption redemption to to Patel. Therefore, Section Patel. Therefore, 8.5 of 8.5 of the the Harbor Harbor Hospice Hospice Partnership Partnership Agreement Agreementdoes doesnot notapply. The only apply. The only summary judgment summary judgment evidence evidence that that was was ever ever allegedly allegedly sent sent to Patel was the Parker Letter. The The Parker Parker Letter Letter (i) (i) does does not not address address redemption, redemption, (ii) does not provide 60 days notice of anything (the deadline in the letter actually passed before the letter was received), was received), (iii) threatens termination, (iii) threatens termination,and and (iv) (iv) does not even does not even mention mention the the general partner, general partner, Harbor Harbor Hospice HospiceManagers, Managers,LLC. Patel's interest LLC. Patel's interest was was not not redeemed in redeemed compliance with in compliance Section 8.5 with Section of the 8.5 of the Harbor Harbor Hospice Hospice Partnership Partnership Agreement. Most Agreement. Most importantly, importantly, Appellees Appellees have failed to establish have failed establish that that Patel's Patel's limited partnership interest was actually redeemed by the partnership partnership or the date of the alleged redemption. Instead Instead of of redeeming redeeming Patel's Patel's limited limited partnership interest to partnership, Appellees the partnership, Appellees decided decided to transfer transfer Patel's Patel's limited limited partnership partnership interest interest directly to Arfeen. 77 The Coverup Though Appellees Though Appellees contend contend Patel’s partnership interest Patel's partnership interest was was "forfeited" “forfeited” 15, 2008, before June 15, 2008, several several significant significant documents documents contradict contradict their their contentions. contentions. A Harbor Hospice Balance Sheet dated December 31, 2008 establishes that Patel was still a limited limited partner partner as as of of that that date. date. (C.R. 217). AAHarbor Harbor Hospice Hospice General General Ledger establishes that Arfeen Ledger from 2009 establishes Arfeen wrongfully wrongfully took possession possession of Patel's Patel's limited partnership interest interest in in 2009. 2009. (C.R. 204-206). Hospice’s accountant, An email from Harbor Hospice's accountant, Monica Surratt, from April of 2009 confirms 2009 confirms Arfeen’s improper direct Arfeen's improper direct transfer transfer stating, stating, “[s]ince the partnership "[Once the partnership interest back (it was did not buy their interest was transferred transferred to Qamar Qamar instead of reallocated reallocated among the other among other partners), partners), then then any any purchase/payment purchase/payment should should have have happened happened outside outside of the partnership.”3 (C.R. the partnership.° (C.R. 207). 207). Arfeen's Arfeen’simproper impropertransfer transfer is is further further evidenced by Harbor Hospice’s Hospice's 8309 Form filed with the Internal Revenue Service Patel’s limited stating that Patel's limited partnership partnership interest interest in Harbor Harbor Hospice Hospice was was transferred transferred directly to directly to Arfeen. (C.R. 208). Arfeen. (C.R. 208). Though Thoughthe theform formstates statesthe thelimited limited partnership partnership interest was transferred as of 1/1/08 that date is inconsistent with the balance sheet 3 3 Arfeen’s improper Arfeen's improper transfer is further confirmed by Harbor Hospice’s Hospice's 8309 Form filed with the Internal Revenue Revenue Service Service stating stating that that Patel’s limited partnership Patel's limited partnership interest in Harbor Hospice was transferred directly to to Arfeen. Arfeen. (C.R. 208). 88 and general ledger, and the form does not appear to have been prepared until April of 2009. (C.R. (C.R. 207, 209). 2011, apparently In 2011, apparently Appellees Appellees realized realized that that they had not they had not completed completed an an appropriate paper appropriate paper trail regarding this trail regarding improper transaction. this improper The Partnership transaction. The Partnership Agreement had Agreement never been amended had never amended to reflect reflect Arfeen's Arfeen's wrongful wrongful acquisition acquisition of Patel's limited partnership Patel's limited partnership interest. Therefore, Appellees interest. Therefore, Appellees created created two two different different Amendment No. Amendment No. 4’s to Agreement 4's to Agreement of of Limited Limited Partnership Partnership of of Harbor Harbor Hospice. Hospice. (C.R. 126-129, 126-129, 135-140). One of 135-140). One of the the Amendment Amendment No. 4's is is dated dated November November 10, 2011 (the "Dated 2011 "Dated Amendment AmendmentNo. No.4"). (C.R. 135-140). 4"). (C.R. 135-140). The The Dated Dated Amendment Amendment No. 4 states: (1)Section 12.2(a) of the Partnership Agreement provides that each limited partner authorizes partner authorizes and and empowers empowers the the general general partners partners to amend the to amend the Partnership Agreement; (2)The General Partner has elected to redeem the limited partner interests of Triptesh Chaudhury and Sandeep Patel in accordance with Section 8.5 of the Partnership Agreement; The General (3)The General Partner Partner desires desires to amend amend the the Partnership Partnership Agreement Agreement to adjust the limited partnership percentages percentages following following the effective effective date of the redemption; (4) The effective (4)The effective date of the redemption shall be January 1, 2008; (5)Exhibit “A” Partnership is hereby amended so that from and after "A" to the Partnership the effective date, the limited partners and their respective interest in the partnership shall be as set forth in such exhibit; and (6)Exhibit “A” "A" appears to reflect all Class C Limited Partners. 9 9 Amendment No. The other Amendment No. 4 (the "Undated "Undated Amendment Amendment No. No. 4") states an effective effective date date but but does does not not state statethe the date dateitit was was executed. executed. (C.R. (C.R. 126-129). The 126-129). The Undated Amendment No. 4 states: (1) The same (1)The same information information set set forth forth in in (1) (1)— – (5) from the Dated Amendment Amendment No. 4 above; (2)The The document documentisis not not dated dated but but states states that was "EXECUTED that it was “EXECUTED to to be st effective as of the 1st 1 day of January, 2008”; 2008"; and (3) Exhibit “A” (3)Exhibit does not "A" does not reflect reflect the the Class Class C Limited Partners. C Limited (C.R. 126- Partners. (C.R. 129). The inconsistencies The inconsistencies inin the the two amendment No. two amendment No. 4’s evidence a blatant 4's evidence blatant attempt to cover up the improper attempt improper transfer. The second transfer. The second Amendment Amendment No. 4 deletes November 10, 2011 date of the November of execution execution and and deceptively deceptively attempts attempts to make the amendment effective amendment effectiveas as of January 1, 2008, of January 2008, nearly nearly four four years years earlier, earlier, without without stating that the document was actually executed in 2011. (C.R. 126-129, 135-140). Regardless Regardless of Appellees’ futile attempt of Appellees' attempt to legally legally effectuate effectuate Arfeen's Arfeen’s improper improper transfer, there transfer, no summary there is no summary judgment judgment evidence evidence indicating indicating that that the the Limited Limited Partnership Partnership Agreement Agreement of of Harbor Harbor Hospice Hospice was amended to remove Patel before was amended before November 10, 2011. (C.R. 135 - 140). 2011. (C.R. Both Amendment Both Amendment 4's 4's state state that that Patel's Patel's interest interest was was redeemed. (C.R. 126- redeemed. (C.R. 129, 135-140). 129, 135-140). Both Both Amendment Amendment 4's 4's are are inconsistent inconsistent with with the the 2009 2009 General General Ledger Ledger of Harbor Harbor Hospice, Hospice, the 2008 2008 Tax Tax Return Return of of Harbor Harbor Hospice Hospice (including (including Form 8308), and and the notes notes of of the accountant accountant of of Harbor Harbor Hospice. Hospice. (C.R. 204 - 206, 10 10 C.R. C.R. 208, 208, and and C.R. 207). TheDated 207). The Dated Amendment Amendment No. No. 44 was was created created nearly nearly four years after the alleged transfer. transfer. ItIt isis unclear unclear when when the the Undated Undated Amendment Amendment 4 was created. When confronted created. When confronted with with the the conflicting conflicting Amendment Amendment 4’s, the Harbor 4's, the Harbor Hospice representative Hospice representative designated designated to to testify testify regarding regarding the alleged termination the alleged termination of Patel’s ownership interest Patel's ownership interest in Harbor Harbor Hospice Hospice stated stated that was concerned that he was concerned that someone might someone might have have done done something something unethical, unethical,immoral immoralororillegal. illegal. (C.R. 212- 213). Appellees persuade the trial court to grant summary judgment Appellees' Amended Motion for Summary Judgment did not seek summary judgment on judgment no-evidence grounds. on no-evidence Instead, Appellees grounds. Instead, Appellees sought sought to establish as to establish as a matter of law that (i) Patel's claims are barred by the statute of limitations, (ii) there was no genuine issue of material fact as to Patel's claims for breach of partnership, breach of fiduciary duty, conversion, or Texas Theft Liability Act violations, and (iii) there (iii) there was was no genuine genuine issue issue of material fact of material fact as as to damages. damages. (C.R. (C.R. 26-141). 26-141). Patel responded with Patel responded evidence establishing with evidence establishing that that Appellees Appellees did did not meet their not meet their burden of proof under any of these burden these theories theories and and by by establishing establishing that fact fact issues issues existed existed that that precluded precluded summary summaryjudgment. judgment. (C.R. (C.R. 145-238 145-238 and and C.R. C.R. 248-254). 248-254). On April 29, 2015, a hearing hearing was was held held on on Appellees' Appellees' Amended Amended Motion for Summary Summary Judgment. (C.R. 291). Judgment. (C.R. 291). The Thesummary summaryjudgment judgment motion motion was was taken taken under under advisement. (C.R. advisement. (C.R. 291). 291). On OnJune June18, 18,2015, 2015,the thetrial trialcourt courtgranted granted Appellees' Appellees' 11 11 Amended Motion Amended Motionfor for Summary SummaryJudgment. Judgment. (C.R. (C.R. 255). Patel then 255). Patel then submitted submitted a Motion for Motion for New New Trial Trial that that was was denied. (C.R. 256-282, denied. (C.R. 256-282, C.R. C.R. 283). This appeal 283). This appeal followed. (C . R. 287-288). (C.R. SUMMARY OF THE ARGUMENT Appellees have not established Appellees established that they are entitled entitled to summary summary judgment judgment as a matter of law on any ground. Appellees sought ground. Appellees sought to establish as a matter of law that (i) Patel's that Patel's claims claims are barred barred by the the statute statute of of limitations, limitations, (ii) there was no (ii) there genuine issue of material fact as to Patel's claims for breach of partnership, breach of fiduciary fiduciary duty, duty, conversion, conversion, or Texas Theft Liability or Texas Liability Act violations, violations, and and (iii) genuine issue there was no genuine issue of material material fact fact as as to to damages. However, facts damages. However, facts issues exist regarding each exist regarding which Appellees each and every ground on which Appellees moved for summary summary judgment. support of their In support their affirmative affirmative defense defense of of statute statute of of limitations, limitations, Appellees Appellees claimed claimed they they could could prove prove as as aa matter matter of of law law that that Patel’s claims for (i) breach Patel's claims breach of fiduciary fiduciary duty, duty, breach breach of partnership, partnership, fraud fraud and declaratory relief and declaratory relief accrued accrued on on or before June 15, 2008 (4 years before suit was filed), and (ii) conversion and Texas Theft Liability Theft Liability Act Act violations violations accrued accrued before before June June 15, 15, 2010 2010 (2 years before suit However, Appellees was filed). However, Appellees failed to meet their burden burden of of proof. Furthermore, proof. Furthermore, Patel presented summary judgment judgment evidence evidence that that establishes establishes that that Patel’s Patel's claims for breach of fiduciary duty, breach of partnership, fraud and declaratory relief accrued 12 12 after June after June 15, 2008 2008 and and that that Patel's Patel’s claims claims for for conversion conversion and and Texas Texas Theft Theft Liability Act violations accrued accrued after after June June 15, 15, 2010. 2010. Accordingly, Appellees failed limitations defense to prove their statute of limitations defense as as a matter matter of law and the trial court should have denied Appellees' should Appellees’ Amended Amended Motion Motion for for Summary Summary Judgment Judgment based based upon Appellees’ statute of limitations defense. Appellees' statute Appellees also claimed that their conduct was proper under the Partnership Appellees Partnership Agreement and Agreement and Texas Texas law and therefore no genuine issue of material fact existed regarding Patel's claims for breach of fiduciary duty, breach of contract, conversion or violations violations of Liability Act. of the Texas Theft Liability Appellees argument Act. Appellees argument is is premised premised solely on the claim that Patel's partnership interest was terminated or redeemed by Harbor Hospice. However, the Hospice. However, the summary summary judgment judgment evidence evidence clearly clearly demonstrates demonstrates Patel's interest that Patel's interest was terminated or redeemed. was not terminated redeemed. Patel's Patel's limited limited partnership partnership interest was interest improperly transferred was improperly transferreddirectly directlytotoArfeen. Not only Arfeen. Not only did did Appellees Appellees improperly transfer improperly transfer Patel's Patel's limited limited partnership partnershipinterest interesttoto Arfeen, Arfeen, they they did did so without informing without informing Patel, Patel, without without complying complying with with the terms of the the terms the Partnership Partnership Agreement, and Agreement, and did not provide did not provide Patel Patel any any compensation compensation for for this this limited limited partnership interest. partnership Accordingly, Appellees failed to establish interest. Accordingly, establish as a matter of law that no genuine issue of material fact existed regarding Patel's claims for breach of fiduciary fiduciary duty, duty, breach breach of contract, conversion of contract, conversion or violations of or violations Texas Theft of the Texas Theft Liability Act. 13 13 Additionally, Appellees Additionally, Appelleesclaimed claimedthat thatno no genuine genuine issue issue of material material fact fact existed existed regarding regarding Patel's Patel's claim claimfor for damages damagesfor for any any cause cause of of action. Appellees action. Appellees allege that allege that pursuant pursuant to the the Partnership Partnership Agreement, Agreement, aa partner partner that that leaves leaves the the partnership either voluntarily voluntarily or through expulsion expulsion leaves with nothing more than his capital account. However, However, the the provisions provisions cited cited by Appellees do not apply to an improper transfer improper transferfrom fromPatel Pateldirectly directlytotoArfeen. Moreover, a fact Arfeen. Moreover, fact issue issue exists exists regarding Patel's capital account account balance. Therefore, Appellees failed to prove that balance. Therefore, material fact existed no genuine issue of material existed regarding regarding Patel's claim for damages for any cause of action. Finally, Appellees Finally, Appellees failed failed to authenticate authenticate any their summary any of their summary judgment judgment evidence. No affidavit evidence. No affidavit was was attached attached to to Appelles' Appelles' Amended Amended Motion Motion for for Summary Summary Judgment Judgment attempting attempting to authenticate any to authenticate the summary any of the summary judgment judgment evidence. evidence. Accordingly, Appellees' Accordingly, Appellees' summary summary judgment judgment evidence evidence was authenticated and was not authenticated should not have been admissible as summary judgment evidence. For all of these reasons, the trial court’s court's judgment should be reversed. 14 14 ARGUMENT I. The Court Erred The Trial Court Erred in in Granting Granting Appellees' Appellees' Amended Amended Motion Motion for Summary Judgment. function of summary judgment The function judgment procedure procedure is is not not to deprive litigants litigants of their right to a full hearing on the merits of fact issues or their right to a jury trial. See Tex. R. Civ. P. 166a; see also Alaniz v. Hoyt,105 S.W.3d 330, 344 (Tex. App. – Corpus — CorpusChristi Christi2003, 2003,not notpet.). pet.). The The goal of the summary judgment procedure is the elimination of patently unmeritorious claims or unmeritorious defenses and the summary termination termination of of a case when it clearly appears appears there there are no issues of fact. Bliss v. See Bliss v. NRG NRG Industries, Industries,
162 S.W.3d 434
162 S.W.3d 434(Tex. (Tex. App. App. — – Dallas 2005, pet. Dallas 2005, denied). Appellate courts Appellate courts review review aa trial trial court’s grant of court's grant of summary summary judgment under a novo standard de novo standard of of review. review. Mann Mann Frankfort Frankfort Stein Stein & Advisors, Inc. & Lipp Advisors, Inc. v. v. Fielding,
289 S.W.3d 844, 848 (Tex. (Tex. 2009). To prevail 2009). To prevail on on aa traditional traditional motion for summary judgment, summary judgment, the the movant movant must must prove prove that that “there "there is is no genuine genuine issue issue as to any material any material fact fact and and the moving party the moving party is entitled to is entitled judgment as to judgment as aa matter matter of law[.]” Tex. law[.]" Tex. R. R. Civ. P. 166a(c). Therefore, Therefore, when when aa defendant defendant moves for summary judgment, he must either disprove disprove at least one essential element element of each theory of recovery pleaded recovery pleaded by by the plaintiff, plaintiff, or he must must plead plead and and conclusively conclusively prove each essential element of an affirmative defense. See Friendswood Dev. Co. v. McDade 15 15 Co.,
926 S.W.2d 280, 282 (Tex. & Co., (Tex. 1996); 1996); Doe v. Boys Boys Club Club of of Greater Greater Dallas, Dallas, Inc.,
907 S.W.2d 472, 476-77 (Tex. 1995). “If there "If there is is any any genuine genuine issue issue of of material material fact, fact, aa motion motion for for summary summary judgment must judgment denied.” Nautilus must be denied." Nautilus Training Training Center Center No. No. 2, Inc. v. 2, Inc. v. Seafirst Seafirst Corp.,
647 S.W.2d 344, Leasing Corp., 344, 346-47 346-47 (Tex. (Tex. App. App. — – Corpus Corpus Christi Christi 1982, 1982, no writ). InIndetermining writ). determining whether whether Appellee Appellee met met its its summary summary judgment judgment burden, burden, this Court must resolve every reasonable inference in favor of Patel, resolve all doubts in favor of Patel, and take all evidence favorable to Patel as true. Rhone-Poulenc, Inc. v.
Steel, 997 S.W.2d at 223(1999). A. ISSUE A. ISSUE ONE:Appellees ONE: AppelleesDid DidNot NotEstablish Establish aaStatute StatuteofofLimitations Limitations Defense as a Matter of Law. Appellees did not establish their statute of limitations limitations defense defense as as a matter of Intheir law. In theirAmended AmendedMotion Motionfor forSummary SummaryJudgment, Judgment,Appellees Appellees relied upon the affirmative defense affirmative defense of of statute statute of of limitations. limitations. (C.R. (C.R. 31-33). Appellees alleged that 31-33). Appellees uncontroverted evidence they had uncontroverted evidence that that Patel Patel knew knew or or should should have have known known of any alleged injuries alleged injuries before before June June 15, 15, 2008 2008 (4 years years before before suit suit was filed) for breach breach of fiduciary duty, breach of partnership, and fraud claims and before June 15, 2010 (2 years before suit was filed) filed) for for the the alleged alleged conversion conversion and Texas Texas Theft Theft Liability Liability Act violations. Act violations. (C.R. (C.R. 31-33). 31-33). Appellees Appellees failed failed to to address address Patel's Patel's claim claim for for declaratory relief declaratory relief in their Amended Amended Motion for Summary Summary Judgment Judgment based upon 16 16 statute of limitations or any other theory. Therefore, summary theory. Therefore, summary judgment disposing of the declaratory judgment action was improper. prevail on aa statute In order to prevail statute of of limitations limitations claim, claim, Appellees Appellees had had to (1) conclusively conclusively prove prove that Patel's cause of action accrued accrued before before the the commencement commencement of the statute of limitations period, and (2) negate the discovery rule by proving as there was no a matter of law that there no genuine genuine issue of material material fact about when Patel discovered, or in the exercise discovered, exercise of reasonable reasonable diligence diligence should have discovered the injury. See Messner See Messner v. Boon, Boon, 2015 2015 Tex. Tex. App. App. LEXIS LEXIS 747, 747, *30 *30 (Tex. (Tex. App. App. Texarkana Jan. Texarkana Jan. 28, 28, 2015). Furthermore, Appellees had to negate Patel's claim of 2015). Furthermore, fraudulent concealment. See Santanna Natural Gas v. v. Hamon Hamon Operations, Operations, 954 S.W.2d S.W.2d 885, 885, 890-891 890-891 (Tex. (Tex. App.--Austin App.--Austin 1997, 1997, pet. pet. denied). Appellees failed to denied). Appellees establish any of these points as a matter of law. Appellees failed Appellees failedtoto establish establishasas aa matter matter of of law law that that Patel's Patel's limited limited partnership interest partnership interest was terminated terminated or otherwise otherwise transferred transferred on on or before June 15, 2008. Significantly, 2008. Significantly, Appellees Appellees have have not not conclusively conclusively established established when when Patel's Patel’s limited partnership limited partnership interest interest was taken from was taken from him, him, whether whether by bytermination, termination, redemption, forfeiture, or improper improper transfer. Viewing all evidence in the light most transfer. Viewing favorable favorable to the non-movant, non-movant, Patel, and resolving all reasonable inferences inferences in his favor, favor, the improper improper transfer transfer does does not appear to have have occurred occurred until sometime sometime in have been 2009 and does not appear to have been legally legally effectuated effectuated through amendment amendment of 17 17 Partnership Agreement the Partnership Agreement until until 2011. Further, Appellees 2011. Further, Appellees failed to establish establish as a matter of law matter law that that Patel Patel discovered discovered or or in in the theexercise exercise of ofreasonable reasonable diligence diligence should have should have discovered discoveredthe theinjury injuryon onor or before beforeJune June15, 15,2008. In addition 2008. In addition to having failed having failed to conclusively conclusively establish establish that Patel’s interest that Patel's interest was was terminated terminated or otherwise otherwise transferred transferred before before June June 15, 2008, Appellees likewise failed to establish establish their statute of limitations defense as a matter of law because of the discovery rule and because of Appellees’ Appellees' fraudulent concealment. Summary Judgment 1. Summary Judgment Evidence Evidence Establishes Establishes Patel Patel Was Was aa Partner Partner in Harbor Hospice After June 15, 2008 The following The following chart clearly demonstrates chart clearly demonstratesthe the timeline timeline of of events events in this in this matter: DATE Description of Document March 4, 2008 Maggie Parker Maggie Parker Threatening Threatening Letter (does not Letter (does not establish establish anything anything for statute of for statute of limitations limitations purposes)(C.R. 121-125) ******* 4 year year statute statute—– June June 15, 15, 2008 ******* December 31, 2008 Harbor Hospice Harbor Hospice Balance Balance Sheet Sheet (C.R. (C.R. 217-219). 217-219). This balance sheet establishes establishes that as of 12/31/08, 12/31/08, Patel was still a limited partner in Harbor Hospice. January 1, 2009 2009 General 2009 General Ledger Ledger of Harbor Harbor Hospice Hospice (C.R. (C.R. 204-206). The 204-206). The 2009 2009General General Ledger Ledger establishes establishes limited partner on January 1, that Patel was still a limited 2009. 18 18 ******* 22year yearstatute statute— – June June15, 15,2010 2010 ******* November 10, 2011 Amendment 4 to the Partnership Amendment Partnership Agreement (C.R. 135-140). This 135-140). This document document establishes establishes that Patel Patel limited partner was still a limited partner in Harbor Harbor Hospice Hospice until November 10, 2011. As set forth above, the following documents demonstrate that Patel was still a partner after June 15, 2008: (a) Dated Amendment No. 4 dated November 10, 2011 (C.R. 135-140). This document This document establishes establishesthat that Patel Patel was was still still a limited limited partner partner in Harbor Hospice until November 10, 2011. (b) Harbor Hospice Balance Sheet as of December 31, 2008 (C.R. 217 219). This - 219). Thisbalance balancesheet sheet establishes establishes that that as as of of December December 31, 31, 2008, 2008, Patel was still a limited partner in Harbor Hospice. 2009 General (c) 2009 General Ledger Ledger of of Harbor Harbor Hospice Hospice(C.R. (C.R.204 204--206). The 206). The 2009 General Ledger establishes that Patel was still a limited partner on January 1, 2009. There are multiple documents in the summary judgment record that indicate Patel was still a Limited Partner as of June 15, 2008 and remained a Limited Partner for a period of time after that date. Therefore, Therefore, Appellees Appellees failed failed to establish as a matter of law that they are entitled to judgment on Patel's Patel’s claims claims for breach breach of fiduciary fiduciary duty, breach duty, breach of the the Partnership Partnership Agreement Agreement and and Fraud, Fraud, under under their statute of their statute limitations defense. limitations The trial defense. The trial court court should should have have denied denied summary summary judgment judgment on limitations grounds limitations grounds based on these based on these documents documents alone. alone. Nevertheless, Nevertheless, even even considering considering the the remainder remainder of of Appellees’ arguments and Appellees' arguments evidence on and evidence issue, on this issue, Appellees’ failed Appellees' failed to to establish establish their limitations defense as a matter of law. 19 19 Appellees Failed 2. Appellees Failed To To Establish Establish As As aa Matter Matter of of Law That Patel Was No Longer a Partner in Harbor Hospice On Or Before June 15, 2008 The evidence relied upon by Appellees was insufficient to justify summary Appellees relied judgment. Appellees relied upon upon the the following following exhibits to establish their statute of limitations defense (i) limitations defense (i) the the Parker Parker Letter Letter (C.R. (C.R. 121 121 - 125), (ii) the the Certified Certified Mail Receipt Receipt for for the Parker Parker Letter Letter dated dated March March 29, 2008 (C.R. 29, 2008 (C.R. 134), 134), (iii) the Dated Dated Amendment No. 4 (C.R. 135 - 140), (iv) the Undated Amendment No. 4 (C.R. 126 - 129), and (v) deposition excerpts from Patel (C.R. 89 - 100). a. The Parker a. The Parker Letter Letter does does not not terminate terminate Patel's Patel's limited limited partnership interest The Parker The Parker Letter Letter does does not not terminate terminate Patel's Patel's limited limited partnership partnership interest. interest. Therefore, the Therefore, the Parker Parker Letter Letter is of no is of no significance significance for for statute statute of oflimitations limitations The letter purposes. The letter isis dated dated March March 4, 4, 2008 2008 and and was was signed signed for by Patel's wife on March 29, March 29, 2008. (C.R. 134). 2008. (C.R. 134). The TheParker ParkerLetter Letter was was aathreat threat and and nothing nothing more. more. Further, in order to terminate Patel's limited partnership interest pursuant to Section Section 10.2 the Partnership 10.2 of the Partnership Agreement Agreement of Harbor Harbor Hospice, Hospice, the general general partners had to partners to unanimously unanimously terminate terminate Patel's Patel's limited limited partnership partnership interest interest and and expel expel him. (C.R. 62). him. (C.R. 62). The Thesummary summaryjudgment judgment record record does does not not contain contain any evidence that any evidence that the the general general partner partner ever ever terminated terminated Patel's Patel's interest interest in Harbor Hospice. 20 20 The Parker The Parker Letter Letter is not not sufficient sufficient to trigger trigger the statute statute of of limitations limitations to "Generally, aa cause begin to run. "Generally, cause of of action action accrues accrues when when facts facts exist exist that authorize a plaintiff to seek judicial relief.” relief." See Schneider Nat’l Nat'l Carriers, Inc. v. Bates Bates, 147 S.W.3d S.W.3d 264, 264, 279 279 (Tex. (Tex. 2004). The Parker 2004). The Parker Letter, Letter, without without further further action action by the general partner general partner of Harbor Hospice, of Harbor Hospice, was was not sufficient sufficient to authorize authorize a plaintiff to seek judicial relief. Therefore, Therefore, for for statute statute of of limitations limitations purposes, purposes, the Parker Letter is meaningless. Appellees' Amended In Appellees' Amended Motion for Summary Summary Judgment, Judgment, Appellees Appellees assert assert that the Parker that Parker Letter Letter was was aa "notice "notice of forfeiture". (C.R. of forfeiture". (C.R. 31). 31). However, However, this this statement is clearly incorrect and demonstrates why Appellees failed to meet their summary judgment burden to establish that Patel was on actual notice of the loss of states that his interest. The Parker Letter never states that Patel's Patel's limited limited partnership partnership been forfeited. interest had been forfeited. Because Becausethe theParker Parker Letter Letter was was nothing nothing but a threat, threat, an additional act had to occur to put Patel on notice of his alleged loss before June 15, 2008. Clearly, Clearly, this this additional additional act did not occur. Additionally, Appellees Additionally, Appelleesargue argue in their Amended in their Amended Motion Motion for for Summary Summary Judgment Judgment that that Patel Patel ignored ignoredthe theletter. letter. (C.R. 29). However, However, Appellees Appellees failed to establish as a matter of law law that that Patel Patel did did not not comply comply with with the the letter. letter. Patel testified deposition that in his deposition that he did not recall recall whether his wife brought brought the letter letter to his attention, that attention, that his wife handled the financials, and that whatever was required he 21 21 certain his was certain his wife, wife, or or his accountant, would his accountant, wouldhave havetaken takencare careofofit. (C.R. 97). it. (C.R. Chapman Chapman was was only only able to speculate able to speculate that Patel had that Patel had not not complied complied with with this this obligation, obligation,but but admitted admittedthat thathe hecould couldnot notsay sayfor forsure. (C.R. 117). sure. (C.R. Appellees 117). Appellees argument that argument that the the Parker Parker letter letter put put Patel Patel on notice that on notice that his interest interest may may be be terminated, oror aa duty terminated, duty to to investigate, investigate, is based based on on the theinconclusive inconclusive and and undocumented assumption undocumented assumption that that he he did did not not comply comply with withits itsrequest. request. Finally, even if was sufficient the Parker letter was sufficient to to give give rise rise to toaaduty dutytotoinvestigate investigatefurther further— – and it was not — was – had had Patel Patel obtained obtained aa copy the partnership copy of the partnership agreement agreement and and all all its amendments at that time, it would not have evidenced a termination of his interest. Thus, the Parker Letter is of no consequence. Amendment 44 to the b. Amendment the partnership partnership agreement agreement was executed on November 10, 2011 According to the Dated Amendment No. 4, the Appellees had not taken any action to take Patel's limited limited partnership partnership interest interest until until November November10, 10,2011. 2011. (C.R. 135-140). This 135-140). This is is less less than than one one year year before before Patel Patel filed filed his his lawsuit. The Dated lawsuit. The Dated Amendment No. 4 was enough to create a fact issue by itself regarding regarding Appellees' statute of limitations claim. c. Undated Amendment 4 No. 4. Undated Amendment The Undated Amendment No. No. 44 that that is effective effective January January 1, 2008 does not establish establishaa date date that that Patel's Patel'scause causeofofaction actionaccrued. accrued. (C.R. (C.R.126 126-- 129). The 129). The Undated Amendment Undated AmendmentNo. No.44 gives gives no indication of no indication when it of when it was was prepared. prepared. 22 22 Furthermore, the Furthermore, the Undated Undated Amendment AmendmentNo. No.44 is inconsistent with is inconsistent Dated with the Dated Amendment No. Amendment No. 4. Finally, Finally, there there isis no no summary summary judgment judgment evidence evidence that Undated Amendment No. Amendment No.44 was was ever provided to ever provided to Patel. Clearly Appellees Patel. Clearly Appellees failed failed to establish establish as as a matter of law that Patel's cause of action accrued accrued prior to June 15, 2008. d. Appellees Appellees failed failed to to establish establish as as aa Matter Matter of Law Law that that Patel Patel knew or should knew should have have known known of any injury on or before before June June 15, 2008 15,2008 Harbor Hospice If Harbor Hospice Managers, Managers, LLC LLC terminated, terminated, forfeited, forfeited, redeemed redeemed or otherwise otherwise transferred transferredPatel's Patel'sinterest interestinin Harbor Harbor Hospice, Hospice, itit would would have have been been required to required notify Patel to notify Patel pursuant pursuant to Section Section 12.2(b) 12.2(b) of of the the Harbor Harbor Hospice Hospice Partnership Partnership Agreement. 66-67). Harbor Agreement. (C.R. 66-67). Harbor Hospice Hospice Managers, Managers, LLC failed to Furthermore, Section do so. Furthermore, Section 3.4 3.4ofofthe theHarbor HarborHospice HospicePartnership Partnership Agreement Agreement required Harbor Hospice to secure Patel's initials on Exhibit "A" to the Partnership Agreement if Agreement if his his partnership partnership interest interestwas waschanged changedorordeleted. deleted. (C.R. (C.R. 45). Finally, 45). Finally, Section 13.4 of the Harbor Hospice Partnership Agreement clearly provides that no modification, waiver modification, waiver of of termination termination of Agreement shall of the Agreement shall be effective effective unless unless made in a writing signed by parties parties sought sought to to be be bound bound thereby. thereby. (C.R. 68). Appellees failed Appellees failed to to take take any any of these actions. of these actions. These These safeguards safeguards were were in limited partner would be placed on notice if his interest place to make sure that a limited was changed or deleted. Patel Patel could could reasonably reasonably rely upon the Appellees to comply 23 23 with the partnership agreement and provide him with the notice required under the partnership agreement partnership agreementififhis his interest interest was was taken taken from from him any manner. him in any manner. Furthermore, Patel Furthermore, Patel could could reasonably reasonably rely rely upon upon the Appellees to comply the Appellees comply with the Partnership Partnership Agreement Agreement and and secure secure Patel's Patel's signature signature before before any effort was made to modify the Partnership Agreement. e. Patel Patel never never testified testified that that his his limited limited partnership partnership interest interest was was terminated, redeemed or transferred to Defendant Arfeen Appellees' claim Appellees' claim that that Patel Patel was on notice notice of of his his impending impending expulsion expulsion and that Patel that Patel simply simply choose choose to ignore the to ignore the notification notification and and warning. (C.R. 32). warning. (C.R. 32). However, these However, assertions are not supported by the these assertions the summary summary judgment judgment evidence evidence and are certainly not supported supported by by the the testimony testimony of of Patel. Patel. (C.R. 89 - 100). Appellees Failed 3. Appellees Failed to to Establish Establish as aa Matter Matter of of Law Law that that Patel's Patel's Cause Cause of Action for Conversion Conversion and Under the Texas Texas Theft Theft Liability Liability Act Accrued on or Before June 15, 2010 Appellees' claim Appellees' claim that that Patel's Patel's causes causes of action for of action for conversion conversion and and for for violations of the Texas Theft Liability Act accrued violations accrued before before June June 15, 2010 and that Patel knew or should have known that his cause of action for conversion and under Liability Act accrued the Theft Liability accrued before before June June 15, 15, 2010. However, Appellees 2010. However, Appellees failed that Patel's to establish as a matter of law that Patel's cause of action action for conversion conversion or under the Theft Liability Act accrued accrued on on or or before before June June 15, 15, 2010. 2010. As set forth above, the Dated Amendment 4 to the partnership agreement dated November 10, 2011 (C.R. 24 24 135-140) is summary 135-140) summary judgment judgment evidence evidence that that Patel Patel was was still still a limited partner in Harbor Hospice until November 10, 2011. Appellees alleged that simple due diligence would have revealed the alleged harm after harm after Patel's Patel's receipt receiptof of the the Parker ParkerLetter. Letter. (C.R. (C.R. 32). However, if Patel 32). However, Patel had reviewed that Partnership reviewed Partnership Agreement Agreement and amendments thereto between 2008 and all amendments November 20, and November 20, 2011, 2011, itit appears appears he he would would have have been been listed listedas as aa partner. partner. (C.R. 135-140, 171-185). 42 -88, 135-140, Appellees have failed to establish 171-185). Appellees establish as a matter of law that Patel could have discovered he was not a partner by reviewing the Partnership Agreement and amendments thereto. Furthermore, ifif Harbor Furthermore, Harbor Hospice Hospice Managers, Managers, LLC LLC terminated, terminated, forfeited, forfeited, redeemed, or redeemed, otherwise transferred or otherwise transferred Patel's Patel's interest interest in Harbor Hospice, in Harbor Hospice, it would would have been have been required required to notify Patel to notify Patel pursuant pursuant to Section Section 12.2(b) 12.2(b) of the the Harbor Harbor Hospice Partnership Hospice Partnership Agreement. 66-67). Harbor Agreement. (C.R. 66-67). Harbor Hospice Hospice Managers, Managers, LLC LLC failed to do so. Section Section 3.4 3.4 of of the the Harbor Harbor Hospice Hospice Partnership Partnership Agreement required Harbor Hospice Harbor Hospice to secure Patel's to secure Patel's initials initials on Exhibit "A" on Exhibit "A" to to the thePartnership Partnership Agreement if Agreement if his his partnership partnership interest interestwas waschanged changedorordeleted. deleted. (C.R. (C.R. 45). 45). This did not occur. occur. Section Section13.4 13.4ofofthe theHarbor HarborHospice HospicePartnership Partnership Agreement Agreement clearly clearly provides that provides modification, waiver that no modification, waiver of termination termination of Agreement shall of the Agreement shall be effective effective unless unless made made in in a writing signed by parties sought to be bound bound thereby. thereby. (C.R. 68). This This also also did not occur. 25 25 Appelleees failed Appelleees failed to to take take any any of of these these actions. These safeguards actions. These safeguards were in limited partner would be placed on notice if his interest place to make sure that a limited was changed or deleted. Patel Patel could could reasonably reasonably rely upon the Appellees to comply with the partnership agreement and provide him with the notice required under the Partnership Partnership Agreement Agreement and and secure secure his signature signature if his interest was taken from him in any manner. Appellees Failed 4. Appellees Failed to to Conclusively Conclusively Establish Establish Under the Discovery Rule that Patel that Patel Knew Knew or or Reasonably Reasonably Should Should Have Have Known Known That That His His Interest Was Terminated by June 15, 2008. The discovery The discovery rule rule defers defers the the time time aa cause cause of of action action accrues, accrues, and and the the limitation period limitation period begins, begins, for for certain certain types types of tort cases. This deferral of accrual is exception to an exception general rule to the general rule under under which which a cause of action action accrues accrues when when a wrongful act causes some wrongful some legal legal injury, injury, even even if the fact of injury is not discovered discovered all resulting until later, and even if all resulting damages damages have not not yet yet occurred. occurred. See S. S.V. V. v. R.V., R. V.,
933 S.W.2d 1, 4 (Tex. 1996). Under Under the the discovery discovery rule, rule, the limitation period starts running from the date the injury is actually discovered discovered or the date when the injury should injury should have have been been discovered discovered if the the plaintiff plaintiff had hadexercised exercised reasonable reasonable diligence, whichever diligence, whichever is earlier. See Moreno v. Sterling Sterling Drug, Drug, Inc., Inc.,
787 S.W.2d 348, 351 (Tex. 348, (Tex. 1990); 1990); Willis Maverick, 760 Willis v. Maverick, S.W.2d 642,
760 S.W.2d 642, 646 (Tex. (Tex. 1988); 1988); Gaddis v. Smith, 417 S.W.2d S.W.2d 577, 577, 578 578 (Tex. (Tex. 1977). The discovery 1977). The discovery rule rule applies to cases which the cases in which the nature nature of of the theinjury injuryisisinherently inherently undiscoverable undiscoverable and and the the 26 26 evidence evidence of of injury injury is objectively objectively verifiable. Both of verifiable. Both of these these circumstances circumstances exist in Injuries arising this case. Injuries arising from from aa breach breach of of fiduciary fiduciary duty are considered inherently S.V., undiscoverable. S. V., 933 933 S.W.2d S.W.2d at 8. Appellees failed Appellees failed to to establish establish as as a matter matter of law that there there was was no no genuine genuine issue of material issue material fact fact that that Patel Patel discovered, discovered, or in in the the exercise exercise of of reasonable reasonable diligence should diligence should have have discovered discovered the the injury injury before before June June 15, 15, 2008. Appellees also 2008. Appellees failed failed to establish establish as as a matter of law that that there there was was no no genuine genuine issue issue of of material material fact that Patel discovered, discovered, or in the the exercise exercise of of reasonable reasonable diligence diligence should have discovered the injury before before June June 15, 15, 2010. Significantly, Appellees have failed to 2010. Significantly, conclusively conclusively establish establish the the date should defeat date the injury accrued, which should defeat summary summary judgment on limitations in and of itself. document that Appellees The only document Appellees are relying relying upon upon to establish establish that Patel Patel discovered or should discovered should have or in the the exercise exercise of of reasonable reasonable diligence diligence should have discovered the discovered the injury injury before beforeJune June15, 15, 2008 2008 isis the the Parker Parker Letter. As explained Letter. As explained above, the above, the Parker Parker Letter Letter was was a threat threat and nothing nothing more more and and did did not put Patel on notice that his interest was terminated. Moreover, generally, generally, a party who is owed a fiduciary duty is relieved of the responsibility ofof diligent responsibility diligentinquiry inquiryinto intothe the fiduciary’s fiduciary's conduct conductas as long long as the as the relationship exists.
Id. Patel reasonablyentitled Patel was reasonably entitled to Sections 3.4, to rely upon Sections 12.2(b), and 12.2(b), the Partnership and 13.4 of the Partnership Agreement Agreement and should have and (i) he should have received received 27 27 notice promptly notice promptly after Appellees allegedly after Appellees allegedly terminated terminatedhis his interest, interest, and and (ii) his (ii) his written signature written signature was required before was required before the the Partnership Partnership Agreement Agreement could could be be modified to transfer modified transfer his his interest. Since Appellees interest. Since Appellees failed failed to to comply comply with with Sections Sections 12.2(b), and 13.4 3.4, 12.2(b), 13.4 of of the the Partnership Partnership Agreement, Agreement, the injury injury was was inherently inherently undiscoverable (the transfer may also be void). Finally, there Finally, there is clearly a fact is clearly fact issue issue based based upon upon the thesummary summary judgment judgment record that record that well well after after June 15, 2008, June 15, 2008, Patel Patel was was still still the the owner owner of of his his limited limited partnership interest. See 2009 General Ledger Ledger (C.R. 204 - 206), 206), Harbor Harbor Hospice Hospice Balance Sheet as of December 31, 2008 (C.R. 217 - 219), 219), and and Dated Dated Amendment Amendment No. No. 4 dated dated November 10, 2011(C.R. November 10, 2011(C.R.135 135 -- 140). 140). Appellees Appellees have have failed failed to establish establish as as a matter of law law that that Patel's Patel's cause cause of of action action accrued accrued before June 15, 2008 or that 2008 that Patel Patel discovered, discovered, or in in the the exercise exercise of of reasonable reasonable diligence diligence should should have discovered the injury before June 15, 2008. Apparently, the only additional document Appellees relied upon to establish that Patel that Patel discovered discovered or should have or should have in in the the exercise exercise ofofreasonable reasonable diligence diligence discovered the injury before before June June 15, 15, 2010 2010 is is Patel's Patel's 2008 2008 K-1. K-1. Appellees assert in the Amended Amended Motion Motion for Summary Summary Judgment Judgment that that since Patel received since Patel received his K-1 K-1 sometime in sometime in 2009, 2009, his his claims claims for for conversion conversion and and theft theft are are time time barred. barred. (C.R. 33). However, Appellees However, Appellees have have failed failed to to establish establish as as aa matter matter of law that Patel Patel should should 28 28 have known have known that that his interest interest in Harbor Harbor Hospice Hospice was was being being taken taken from from him him as as a result of a K-1. Patel testified that: Arfeen took (i) he was shocked that Dr. Arfeen took his his ownership ownership interest away (C.R. 222); and (ii) he discovered he was no longer a partner in Harbor Hospice right before he retained his attorney (C.R. 96). Furthermore, as Furthermore, explained above, as explained Harbor Hospice above, if Harbor Hospice Managers, Managers, LLC LLC terminated, forfeited or redeemed Patel's interest in Harbor Hospice, it would have required to notify Patel pursuant been required pursuant to Section Section 12.2(b) of the the Harbor Harbor Hospice Hospice Partnership Partnership Agreement. Harbor Hospice Agreement. (C.R. 66 - 67). Harbor Hospice Managers, Managers, LLC failed to Furthermore, Section do so. Furthermore, Section 3.4 3.4ofofthe theHarbor HarborHospice HospicePartnership Partnership Agreement Agreement required Harbor Hospice to secure Patel's initials on Exhibit "A" to the Partnership Agreement ifif his Agreement his partnership partnership interest interestwas waschanged changedorordeleted. deleted. (C.R. (C.R. 45). Section 45). Section 13.4 of 13.4 of the the Harbor Harbor Hospice Hospice Partnership Partnership Agreement Agreement clearly clearly provides provides that that no modification, waiver modification, waiver of of termination termination of Agreement shall of the Agreement shall be effective effective unless unless made in a writing signed by parties parties sought sought to to be be bound bound thereby. thereby. (C.R. 68). Defendants failed Defendants failed to to take take any any of of these these actions. These safeguards actions. These safeguards were in limited partner would be placed on notice if his interest place to make sure that a limited was changed or deleted. Patel Patel could could reasonably reasonably rely upon the Appellees to comply with the Partnership Agreement and provide him with the notice required under the 29 29 Partnership PartnershipAgreement Agreementififhis his interest interestwas was taken taken from from him any manner. him in any manner. Attempting to slide information past Patel in a K-1 is certainly not sufficient under the Partnership the Partnership Agreement Agreementororinin light light of fiduciary nature of the fiduciary nature of the parties' of the parties’ relationship. It would have been reasonable for Patel to believe that unless he received the notice required notice required under under the the Partnership Partnership Agreement Agreement and and signed signed documents documents terminating or terminating otherwise transferring or otherwise transferring his his partnership partnership interest, interest,that that he he was was still still a limited partner limited partner and and that that no no cause cause of of action action had had yet yet accrued. accrued. After all, there is no summary judgment summary judgment evidence evidence suggesting suggestingthat that Patel Patel ever signed aa document ever signed document transferring his interest in Harbor Hospice. Finally, according Finally, according to Amendment 4 to to Dated Amendment to the the Partnership Partnership Agreement, Agreement, executed executed November November 10, 10, 2011, 2011, the the Appellees Appellees had had not not taken taken any any action action to to take or transfer Patel's transfer Patel's limited limited partnership partnership interest interestuntil untilNovember November10, 10,2011. 2011. This is less than one year before Patel filed his lawsuit. When one considers When considers the requirements requirements of the the Harbor Harbor Hospice Hospice Partnership Partnership Agreement, the Agreement, the fiduciary fiduciary nature nature of of the parties’ relationship, and Amendment parties' relationship, Amendment 4 to the Partnership Partnership Agreement Agreement dated dated November November 10, 10, 2011, 2011, aa fact issue clearly clearly exists regarding whether regarding whetheror or not not Patel Patel discovered discoveredor or should should have have in the exercise in the exercise of reasonable diligence reasonable diligencediscovered discoveredthe theinjury injurybefore beforeJune June15, 15,2010. Patel never 2010. Patel never received the notification he was required to receive from the general partner, Patel 30 30 Partnership Agreement, never received an amended Partnership Agreement, and and Patel Patel was never asked to sign a document stating that his partnership interest was taken away. 5. Appellees Appellees Failed Failed to to Conclusively Conclusively Negate Negate Patel's Patel’s Affirmative Affirmative Defense of Fraudulent Concealment. The fraudulent The fraudulent concealment concealment doctrine doctrine applies applies when defendant makes when a defendant makes fraudulent fraudulent misrepresentations misrepresentationsor, or, ifif under under aa duty to disclose, conceals facts from the plaintiff and thereby prevents the plaintiff from discovering the cause of action against the defendant. against defendant. See Santanna Santanna Natural Natural Gas v. v. Hamon Hamon Operations, Operations, 954 S.W.2d S.W.2d 885, 885, 890-891 890-891 (Tex. (Tex. App.--Austin App.--Austin1997, 1997,pet. pet.denied). denied). As with the As with the discovery rule, discovery rule, this this doctrine doctrine tolls tolls the the statute statute of limitation until of limitation until the fraud is the fraud discovered or could have been discovered with reasonable diligence. See Shell Oil Co. Ross, 356 Co. v. Ross, 356 S.W.3d S.W.3d 924, 924, 927 (Tex. 2011). 927 (Tex. 2011). The Theelements elements of of fraudulent fraudulent concealment include the following: (1) the existence of the underlying tort; (2) the defendant's knowledge defendant's knowledge of of the the tort; (3) the defendant's use of deception to conceal the tort; the tort; and and (4) (4) the the plaintiffs plaintiff'sreasonable reasonable reliance reliance on on the the deception. deception. See See BP America Prod. Co. v. Marshall, Marshall 342 S.W.3d S.W.3d 59, 59, 67-69 67-69 (Tex. (Tex. 2011). 2011). A breach of a fiduciary fiduciary duty duty of disclosure is tantamount of disclosure tantamount to concealment concealment for purposes of for purposes of the doctrine. See Dernick Dernick Resources, Resources, Inc. v. v. Wilstein, Wilstein, 312 312 S.W.3d S.W.3d 864, 878 (Tex. (Tex. App.--Houston [1st App.--Houston [1st Dist.] Dist.] 2009, 2009, no no pet.). Stateddifferently, pet.). Stated differently, silence silence constitutes constitutes fraudulent fraudulent concealment concealmentwhen whenaa defendant defendanthas has aa duty duty to disclose disclose and its silence silence 31 31 prevents the plaintiff from discovering the injury. See Haas v. George,
71 S.W.3d 904, 913 (Tex. App.—Texarkana 2002, no pet.). summary judgment evidence demonstrating that Appellees failed to present summary they ever informed Patel that his partnership interest was taken from him, or even conclusively conclusivelydemonstrating demonstratingwhen whenit itwas wastaken takenaway awayfrom from him. Appellees him. Appellees concealed concealed the the fact fact that that Patel’s interest was Patel's interest was transferred transferred directly directlyto to Arfeen. (C.R. Arfeen. (C.R. Appelleeswere 126 - 129, 1353 - 140). Appellees were required required pursuant pursuant to to the the Harbor Harbor Hospice Hospice Partnership Partnership Agreement Agreementtoto disclose disclosethis thisto to Patel Patel and and did did not not do so. See Section 12.2(b) the 12.2(b) Partnership Agreement the Partnership Agreement(C.R. (C.R.66 66-- 67). Appellees were 67). Appellees were required required to secure Patel's secure Patel's signature signature on document transferring on any document transferring his his interest interest to Arfeen but failed to do so (C.R. 45 and 68). This This conduct conduct violated violated the the Partnership Partnership Agreement and was a breach of fiduciary duty. Instead, Appellees duty. Instead, Appellees created two Amendment 4's in an effort to conceal conceal the the improper improper transfer transfer to to Arfeen. Arfeen. (C.R. 135 - 140 and 126 - Thedocumentary 129). The documentary evidence evidence in in the the record, record, coupled coupled with with Appellees Appellees failure to comply with the notice provisions of the Partnership Partnership Agreement, constitutes some evidence of fraudulent fraudulent concealment. concealment. Appellees did not conclusively negate negate Patel’s Patel's affirmative defense of fraudulent concealment as a matter of law. B. ISSUE B. ISSUE TWO: TWO: TheThe Trial Trial Court Court Erred Erred in in Concluding Concluding that that No No Genuine Issue Genuine Issue of Material Material Fact Fact Exists Exists on Any of Patel's Patel’s Asserted Asserted Claims. 32 32 Thetrial 1. The trialcourt court erred erred in in granting granting summary summary judgment regarding Patel's breach Patel's breach of fiduciary fiduciary duty claims claims because because the summary summary judgment evidence raises questions of material fact. Appellees allege that their actions in wrongfully taking possession of Patel's limited partnership limited partnership interest interest were appropriate under were appropriate that Harbor under that Harbor Hospice Hospice Partnership Partnership Agreement. Appellees also allege Agreement. Appellees allege that since their conduct conduct was proper under the Partnership Agreement and under Texas law, there cannot cannot be a breach of fiduciary fiduciary duty duty claim. However, in claim. However, in order order totosupport supportthis thisargument, argument, Appellees Appellees assume that assume partnership interest that Patel's partnership interest was terminated or redeemed was terminated redeemed by Harbor Harbor (C.R. 33 Hospice. (C.R. 33 -36). -36). As Asexplained explainedabove, above,aafact fact issue issue exists exists regarding regarding whether Patel's partnership interest Patel's partnership interest was redeemed, terminated, was redeemed, terminated, or transferred directly or transferred directly to Arfeen. (C.R. (C.R. 204 204 -- 206, 206, 207, 208). Appellees assert that the elements of a breach of fiduciary duty claim are (i) plaintiff and defendant plaintiff defendant had a fiduciary fiduciary relationship, relationship, (ii) defendant defendant breached breached this duty, (iii) this breach duty, breach resulted resulted in harm to plaintiff plaintiff or or benefit benefit to to defendant. defendant. See Graham Graham Morg. Morg. Corp. Corp. v. v. Hall, Hag
307 S.W.3d 472, 479 (Tex. App. - Dallas 2010, no pet). (C.R. pet). (C.R. 33). 33). Appellees Appelleesallege allege that that there there is is no no requirement requirement in law or in the in law the Partnership Partnership Agreement Agreement that that prevents prevents them them from from rejecting rejecting Patel Patel as their their partner. partner. (C.R. 35). (C.R. 35). Relying Relying upon Section 10.2 upon Section 10.2 of of the thePartnership Partnership Agreement Agreement (Expulsion/Termination Provision), (Expulsion/Termination Provision), Appellees Appellees assert assert that that exercising exercising aa right under the Partnership the Partnership Agreement Agreementis isnot notaa breach breach of of fiduciary fiduciaryduty. (C.R. 30). duty. (C.R. 30). 33 33 Apparently, Appellees Apparently, Appelleesasserted assertedthat thatthere therewas was no no breach breach of of fiduciary fiduciary duty duty as as a matter of law. matter law. However, However,the thesummary summaryjudgment judgmentevidence evidence clearly clearly demonstrates demonstrates that Patel's partnership interest was not terminated in accordance accordance with with the terms of the Partnership Agreement, rather rather itit was was transferred transferred directly directly to to Arfeen. Arfeen. (C.R. 204 - 206, 207, 208). InInlight lightofofthis thissummary summaryjudgment judgmentevidence, evidence, Appellees' Appellees' reliance reliance the Partnership upon Section 10.2 of the Partnership Agreement Agreement is misplaced misplaced and cannot support summary judgment. Appellees assertion Appellees assertion that that they they did did not violate violate the terms terms of of the the Partnership Partnership Agreement isis also Agreement incorrect. AAcursory also incorrect. cursory review review of ofthe thePartnership Partnership Agreement Agreement shows that Appellees violated the following provisions: (a) Section Section 3.4 requires requires all general general partners partners and limited limited partners partners whose whose interest has interest has changed changedtotoinitial initialExhibit Exhibit"A". "A". (C.R. (C.R. 45). This did not 45). This occur. Section 3.4 is in place to protect a limited partner such as Patel to prevent his interest from being taken without his knowledge. (b) Section Section 7.2(iii) 7.2(iii) prevents prevents the general partner the general partner from from amending amending thethe Harbor Hospice Harbor Hospice Partnership Partnership Agreement Agreement without without the the approval approval of of the limited partners limited partners owning owning moremore than 50% of the than 50% the aggregate aggregate limited limited partnership interest. partnership (C.R. 51). Appellees interest. (C.R. Appellees wrongful wrongful transfer transfer of Patel's Limited LimitedPartnership Partnership Interest to Arfeen Interest to Arfeenviolates violatesthis provision. this provision. Furthermore, the wrongful transfer was committed without informing Patel. (c) Section Section 7.2(iv) prevents the 7.2(iv) prevents general partner the general partner from from permitting permitting any any assignment or assignment transfer of any or transfer any portion portion of of the the partnership partnership agreement agreement without the approval of the limited partners owning more than 50% of the aggregate the aggregate limited limited partnership partnershipinterest. interest. (C.R. (C.R. 51). Appellees 51). Appellees Limited Partnership Interest violates this wrongful transfer of Patel's Limited Furthermore, the provision. Furthermore, the wrongful wrongful transfer transfer was was committed committed without informing Patel. 34 34 (d) Section 8.1 prevents any limited partner from assigning any portion of his limited partnership interest without the prior written consent of all of the thegeneral generalpartners. partners. (C.R. (C.R. 53 53 - 54). 54). Furthermore, Furthermore, section section 8.1 8.1 provides that provides thatany attempted assignment any attempted assignment which which is permitted by is not permitted Section Section 8.1 shall be automatically void and ineffective, except except to the extent extent otherwise otherwise required requiredbyby law. Appellees wrongful law. Appellees wrongful transfer transfer of Patel's Limited Partnership Partnership Interest Interest to Arfeen violates this provision. provision. Furthermore, the wrongful transfer was committed without informing Patel. (g) Defendants Defendantsfailed failedtoto satisfy satisfySection Section8.5 8.5 and and 10.2 10.2 as has been as has been explained above. (h) Section 12.2(a)(iv) 12.2(a)(iv) provides provides that the general partners shall not reduce the rights the rights or or interests, interests, or or enlarge enlarge the the obligations, obligations, or the the limited limited partners without the prior written consent of all of the limited partners. Appellees wrongful (C.R. 66). Appellees wrongful transfer transfer of of Patel's Patel's Limited Limited Partnership Partnership Interest violates Interest violates this provision. Furthermore, this provision. Furthermore, the the wrongful wrongful transfer transfer was committed without informing Patel. (i) (i) Section 12.2(b) provides that the general partner shall promptly notify limited partners the limited partners of of any any such such amendments. amendments. (C.R. (C.R. 66). Appellees 66). Appellees wrongful transfer wrongful transfer of Patel's Patel's Limited Limited Partnership Partnership Interest Interest to Arfeen Arfeen violates this violates provision. Furthermore, this provision. Furthermore, the the wrongful wrongful transfer transfer was was committed without informing Patel. (j) Section Section 13.4 the Harbor 13.4 of the Harbor Hospice Hospice Partnership Partnership Agreement Agreement clearly clearly provides that no modification, waiver of termination of the Agreement beeffective shall be effectiveunless unlessmade madeininaa writing writing signed signed by by parties sought to be bound bound thereby. thereby. (C.R. 68). Clearly,this 68). Clearly, this did did not not occur. Appellees have Appellees have failed failed to establish establish that their conduct conduct was proper under the Harbor Hospice Partnership Agreement. Appellees concede Appellees concedethat that aa partner’s partner's fiduciary fiduciary duty duty includes: includes:(i) (i) aa duty duty of loyalty to the concern, loyalty concern, (ii) a duty duty of of good good faith, faith, fairness fairness and and honesty honesty in in dealing dealing with each other on matters pertaining to the partnership, (iii) duty of full disclosure 35 35 on all matters, on all matters, (iv) (iv) accounting accounting for for partnership partnership profits profits and and property, property, and (v) and (v) refraining from refraining from competing competing or or dealing dealing with with the partnership partnership in a manner adverse to partnership. (C.R. the partnership. (C.R. 34 34 at at paragraph paragraph 28). Appellees Appellees violated violated their their fiduciary fiduciary duty to Patel by improperly transferring Patel's limited partnership interest to Arfeen, by failing failing to inform Patel Patel of the same, and by failing failing to to pay pay Patel Patel any any consideration consideration for the limited limited partnership partnership interest. interest. (C.R. 96, 222, 222, 223 223 and and 235). Appellees have 235). Appellees failed to establish establish as a matter of law that that Appellees Appellees did not breach breach their fiduciary fiduciary duty to Patel. Appellees did Appellees even suggest did not even suggest in in their theirAmended Amended Summary Summary Judgment Judgment Motion that Motion they were that they were entitled entitled to to summary summary judgment judgment if Patel's Patel's interest interest was was transferred directly transferred directlyto to Arfeen. On the Arfeen. On the record record before before court, court, Appellees Appellees failed failed to establish establish as as a matter of law that that Appellees Appellees did not breach breach their fiduciary duty to Patel. Thetrial 2. The trialcourt court erred erred in in granting granting summary summary judgment regarding Patel's breach Patel's breach of breach of of breach of contract contract claim claim because because the the summary judgment evidence raises questions of material fact. Appellees sought Appellees sought summary summary judgment judgment regarding regarding Patel's Patel's claim claim for for breach breach of contract by asserting that Patel could not establish a genuine issue of material fact regarding the regarding the element element of of breach. Appellees again breach. (C.R. 36). Appellees again asserted asserted that (i) they were entitled to terminate or expel Patel from Harbor Hospice pursuant to Section Partnership Agreement 10.2 of the Partnership Agreement(C.R. (C.R.36), 36),and and(ii) no provision (ii) no provision of the Texas Texas 36 36 Business Organizations Business Organizations Code Code prohibits prohibits partners partners from agreeing to from agreeing to expulsion expulsion provisions in a partnership provisions partnership agreement agreement (C.R. (C.R. 37). However, as explained 37). However, explained above, a fact issue exists fact issue exists regarding regarding whether whether Patel's Patel's partnership partnership interest interest was was redeemed, redeemed, terminated, or transferred directly directly to to Arfeen. Arfeen. (C.R. 204 - 206, 207, 208). Clearly, Clearly, if Patel's partnership interest was transferred transferred directly directly to Arfeen, as evidenced evidenced by the documents in the summary summary judgment record, Appellees violated Sections Sections 3.4, 3.4, 7.2(iii), 7.2(iii), 7.2(iv), 7.2(iv), 8.1, 8.1, 8.5, 12.2(a)(iv), 12.2(b), 8.5, 10.2, 12.2(a)(iv), 12.2(b), and and 13.4 13.4 of the Partnership PartnershipAgreement. Agreement. (C.R. (C.R. 45, 45, 51, 51, 53-54, 53-54,66, 66,and and68). 68). It is also clear that that if Patel's partnership partnership interest interest was was transferred transferred directly directly to to Arfeen, Arfeen, Section Section 10.2 10.2 of the Partnership Partnership Agreement Agreement does does not not apply. Substantial summary apply. Substantial summary judgment judgment evidence evidence exists demonstrating demonstrating that that Patel's Patel's interest interest was was transferred transferreddirectly directlyto toArfeen. Arfeen. (C.R. 204 -- 206, 204 206, 207, 207, 208). 208). Substantial Substantialsummary summaryjudgment judgment evidence evidence also also exists exists indicating that indicating that Appellees Appellees failed failed to to inform inform Patel Patel of of the transfer and the transfer and failed failed to pay Patel any consideration for the limited partnership interest. (C.R. 96, 222, 223 and Therefore, aa fact 235). Therefore, fact issue issue exists exists regarding regarding Patel's Patel's claim for breach of contract. 3. The Thetrial trialcourt court erred erred in in granting granting summary summary judgment regarding Patel's conversion Patel's conversion claim claim because because the the summary summary judgment judgment evidence raises questions of material fact. Appellees sought summary judgment regarding Patel's claim for conversion asserting that by asserting Patel could that Patel could not establish establish aa genuine genuine issue issue of material fact of material fact as to expulsion was justified under Section 10.2 of the whether expulsion the Partnership Partnership Agreement Agreement 37 37 and therefore termination of Patel's interest cannot constitute conversion (C.R. 38). In support of this Argument, Appellees claimed that Patel violated the Partnership Agreement and Agreement and triggered triggered Section Section 10.2 10.2 of of the the Partnership Partnership Agreement. Agreement. (C.R. 38). Appellees also Appellees also allege allege that that they they had every right had every right to take take control control of of Patel's Patel's shares. shares. (C.R. 38). (C.R. 38). However, However, as asexplained explained above, above, aa fact fact issue issue exists exists regarding regarding whether whether Patel's partnership interest Patel's partnership interest was redeemed, terminated, was redeemed, terminated, or transferred directly or transferred directly to (C.R. 204 Arfeen. (C.R. 204 -- 206, 206, 207, 208). partnership interest was transferred If Patel's partnership transferred directly to Arfeen, Arfeen, Appellees Appellees violated Sections 3.4, 7.2(iii), 7.2(iv), 8.1, 8.5, 10.2, 12.2(a)(iv), 12.2(b), and 13.4 of the Partnership Partnership Agreement. Agreement. (C.R. 45, 51, 53-54, 53-54, 66, 66, and and 68). Further, if Patel's 68). Further, partnership interest partnership interestwas was transferred transferreddirectly directlytoto Arfeen, Arfeen, Section Section 10.2 10.2 of the of the Partnership Agreement does not apply. Substantial Substantial summary summary judgment judgment evidence exists demonstrating evidence exists demonstrating that Patel's Patel's interest was transferred transferred directly directlyto to Arfeen. Arfeen. (C.R. 204 - 206, 206, 207, 207, 208). 208). Substantial summary judgment evidence evidence also exists indicating that Appellees failed to inform Patel Patel of the the transfer transfer and and failed failed to to pay pay Patel Patel any any consideration consideration for the the limited limited partnership interest. partnership interest. (C.R. 96, 222, 223 223 and 235). Therefore, and 235). Therefore, aa fact fact issue issue exists exists regarding Patel's claim for conversion. The trial 4. The trial court court erred erred iningranting grantingsummary summary judgment judgment regarding regarding Patel's claim Patel's claim for Texas Texas Theft Theft Liability Liability Act Act violations violations because because the summary judgment evidence raises questions of material fact. 38 38 Appellees sought summary Appellees summary judgment judgment regarding regarding Patel's violations Patel's claim for violations of the the Texas Texas Theft Theft Liability Liability Act Act by asserting asserting that that Patel Patel could could not not establish establish a genuine issue of material fact as to whether whether expulsion expulsion was justified under Section 10.2 of the 10.2 the Partnership Partnership Agreement Agreement and and therefore therefore termination termination of Patel's Patel's interest interest cannot constitute constitute theft theft (C.R. (C.R. 38). In support 38). In support of of this this Argument, Argument, Appellees Appellees claimed violated the Partnership that Patel violated Partnership Agreement Agreement and and triggered triggered Section Section 10.2 10.2 of the Partnership Partnership Agreement. Agreement. (C.R. (C.R. 38). Appellees also 38). Appellees also allege allege that had every every right to take control of Patel's Patel's shares. However, as shares. (C.R. 38). However, as explained explained above, above, a fact issue exists regarding whether Patel's partnership interest was redeemed, terminated, or transferred directly to to Arfeen. (C.R. 204 - 206, 207, 208). Arfeen. (C.R. As is set forth above, if Patel's partnership interest was transferred directly to Arfeen, Appellees violated Sections 3.4, 7.2(iii), 7.2(iv), 8.1, 8.5, 10.2, 12.2(a)(iv), 12.2(b), and 13.4 13.4 of the Partnership Partnership Agreement. Agreement. (C.R. 45, 51, 53-54, 66, and 68). Additionally, ifif Patel's Additionally, Patel's partnership partnership interest was transferred interest was transferred directly directly to Arfeen, Arfeen, Section 10.2 of the Partnership Agreement does not apply. Substantial Substantial summary summary judgment judgment evidence exists demonstrating evidence exists demonstrating that Patel's Patel's interest was transferred transferred directly directlyto to Arfeen. Arfeen. (C.R. 204 - 206, 206, 207, 207, 208). 208). Substantial summary judgment evidence also exists that Appellees failed to inform Patel of the transfer and transfer failed to pay and failed pay Patel Patel any anyconsideration consideration for for the the limited limited partnership partnership 39 39 interest. (C.R. interest. (C.R. 96, 96, 222, 222, 223 223 and and 235). 235). Therefore, Therefore, aafact factissue issue clearly clearly exists exists regarding Patel's claim for violations of the Texas Theft Liability Act. 5. The Thetrial trialcourt court erred erred in in granting granting summary summary judgment regarding Patel's claim Patel's claim for fraud because for fraud because Appellees Appellees did not seek did not seek summary judgment regarding Patel’s Patel's fraud claim. Appellees did not independently Appellees independently seek summary summary judgment judgment regarding regarding Patel’s Patel's claim claim for fraud by by non-disclosure non-disclosure in Appellees' Appellees’ Amended Amended Motion Motion for for Summary Summary Judgment. (C.R. 26-141). Judgment. (C.R. 26-141). Appellees Appelleesonly onlysought soughtsummary summary judgment judgment regarding regarding Patel’s fraud claim Patel's fraud claim in in the the Amended Amended Motion for Summary Judgment based upon the theory that (i) the fraud claim is barred by statute of limitations, and (ii) Patel did not suffer damages damages as as aa result result of of Patel’s Patel's fraud claim. These arguments claim. These arguments are without merit and are discussed elsewhere elsewhere in in this this brief. It would brief. It would be be reversible reversible error for the trial court trial court to to grant grantAppellees' Appellees’Amended Amended Motion Motion for forSummary Summary Judgment Judgment independently regarding independently regarding Patel’s Patel's fraud claim because this relief was not requested requested in the Amended Motion for Summary Judgment. See G&H Towing Co. v. Magee, Mage4
347 S.W.3d 293, 297 (Tex. 2011). C. ISSUE ISSUETHREE: THREE: The TheTrial TrialCourt CourtErred ErredininConcluding Concluding Appellees Appellees Conclusively Established that Patel Did Not Suffer Damages. Appellees alleged Appellees alleged that that Patel could not establish Patel could establish injury injury from any any alleged alleged cause cause of of action. (C.R. 38 action. (C.R. 38 at at paragraph paragraph 37). In Infact, fact,Appellees Appellees alleged alleged that"[i]t that"[i]t is clear that the clear that the partnership partnership agreement, agreement, the the terms which Plaintiff terms of which Plaintiff agreed agreed to, to, provides that any partner who leaves the partnership, either voluntarily or through 40 40 expulsion, expulsion,leaves leaveswith withnothing nothingmore morethan thanhis his capital capital account." (C.R. 39). account." (C.R. 39). However, Patel However, Patel did not leave did not leave the the partnership partnership voluntarily voluntarily or or though though expulsion. expulsion. There is no provision in the Partnership Agreement that provides Patel was entitled capital account if his to nothing more than his capital his shares shares were were improperly improperly transferred transferred directly to directly Arfeen. Pursuant to Arfeen. Pursuant to to Sections Sections 3.4, 3.4, 8.1, 8.1, and and 13.4 13.4 of of the thePartnership Partnership Agreement of Harbor Hospice, the alleged transfer to Arfeen is void and that Patel is entitled to retain retain his his limited limited partnership partnershipinterest. interest. (C.R. (C.R. 42-88). Therefore, under 42-88). Therefore, the Partnership Agreement Agreement Patel Patel is entitled to the return of his limited limited partnership partnership interest in Harbor Hospice. Furthermore, Furthermore, since since Arfeen Arfeen and and Arfeen Arfeen Properties have wrongfully taken the distributions that Patel was entitled to, Patel is entitled a pro- rata share of the distributions made to Arfeen and/or Arfeen Properties since 2008 th (financial amounts (financial amounts redacted redacted pursuant pursuant to to Order from the 58 Order from District Court 5g1i District Court in Chapman Chapman v. Arfeen, et. v. Arfeen, et. al.)(C.R. al.)(C.R. 227 227 -- 233). 233). Arfeen Arfeen wrongfully wrongfully received received a substantial amount of distributions and Arfeen Properties, LP wrongfully received amount of distributions an even greater amount distributions that that clearly clearly belonged belonged to to Patel. Appellees Patel. Appellees Amended Motion for Summary Judgment did not address these claims at all. Patel Patel is also also entitled entitled to the the value value of of his hislimited limited partnership partnership interest interest under under Texas law on the date it was improperly acquired by Arfeen.See Qaddura v. Indo- European Foods, European Foods, Inc., Inc., 141 141 S.W.3d S.W.3d 882, 882, 888-890 888-890 (Tex. (Tex. App. App. Dallas Dallas 2004); 2004); Aquaplex, Inc. v. Rancho La Valencia, Inc. Inc,,
297 S.W.3d 768, 775-776 (Tex. 2009); 41 41 Wilson, 137 Punts v. Wilson, 137 S.W.3d S.W.3d 889, 891 (Tex. (Tex. App. App. Texarkana Texarkana 2004); 2004); Groves Groves v. Hanks,
546 S.W.2d 638, 647 (Tex. Civ. App. Corpus Christi 1976); e.g. Business Organization’s Organization's Code Code Section Section 152.602.. There is 152.602.. There is no no provision provision in in the the Partnership Partnership Agreement ofofHarbor Agreement HarborHospice Hospicetotothe thecontrary. contrary. (C.R. (C.R.42 42 -- 88). 88). Appellees Appellees Amended Motion for Summary Judgment likewise did not address this claim at all. Appellees also Appellees argued that also argued that if if Patel's Patel's limited limited partnership partnership interest interest was was redeemed then the purchase price of his redeemed interest is limited to his capital redeemed account. First account. First of of all, all, Patel's Patel's interest interest was not redeemed redeemed (see (see above). Secondly, the above). Secondly, Business Organization Code provides: . .. .. aapartnership partnership agreement agreement governs governs the relations relations of the partners partners and between the partners between partners and the the partnership. partnership. To the extent To the extent that that the the partnership agreement partnership agreementdoesdoesnot otherwise not otherwiseprovide, provide,this chapter this chapter and the other partnership provisions govern the relationship of the partners and between the partners and the partners the partnership partnership. Business Business Organization’s Organization's Code Section 152.002(a)("emphasis 152.002(a)('emphasis added"). added'). . . . the redemption price of a withdrawn partner’s partner's partnership interest is the fair the fair value value of the the interest interest on the the date date of of withdrawal. withdrawal. Business Business Organization’s Organization's Code Section 152.602(a). Therefore, if Patel's limited partnership interest was redeemed, Section 8.5 Therefore, of the Partnership Agreement would not apply because Appellees failed to provide Patel with with 60 days notice notice as required. required. Since Since Appellees Appellees failed failed to comply comply with the terms of the partnership agreement, Texas law applies and Patel would be entitled to the fair value of his limited partnership interest pursuant to section 152.602(a) of the Business Organization's Code. 42 42 Finally, even Finally, even if Section 8.5 of of the the Partnership Partnership Agreement Agreement applied, applied, Patel is entitled entitled to to damages. Patel's K-1 damages. Patel's K-1 for for the the year year 2008 2008 states states that that Patel Patel received received a distribution from distribution from Harbor HarborHospice Hospiceinin the the amount amount of of $28,575.00. (C.R. 141). $28,575.00. (C.R. 141). However, the Harbor Hospice general ledger for the year 2008 does not reflect any distributions totoPatel. distributions (C.R. 234). Patel. (C.R. 234). Patel Pateltestified testifiedthat thathe henever never received received any any money. (C.R. money. (C.R. 223 223 and and 235). 235). Therefore, Therefore,Appellees Appelleeshave have wrongfully wrongfully asserted asserted that $28,575 $28,575 was was paid paid to to Patel Patel even even though though itit was was not. Clearly, this not. Clearly, this would would increase increase Patel's capital account account by by $28,575. Once this $28,575. Once this inaccurate inaccurate entry is removed from the account balance K-1 of Patel, Patel's capital account balance would would be be $28,575. Therefore, even $28,575. Therefore, under Appellees' theory theory of damages, damages, Patel Patel would would be entitled to at least $28,575 in damages. Appellees damages. Appellees are are unable unable to establish establish that that there there is no genuine is no genuine issue issue of material fact regarding Patel's claim for damages. D. ISSUE D. ISSUE FOUR: FOUR: The The Trial Trial Court Court Erred Erred ininGranting Granting Summary Summary Judgment Because Judgment Because Appellees' Appellees' Failed Failed to Authenticate Authenticate Any Any of Their Summary Judgment Evidence. Appellees failed Appellees authenticate any of their failed to authenticate their summary summary judgment judgment evidence. evidence. (C.R. 26 (C.R. 26 - 141). 141). No Noaffidavit affidavitwas wasattached attachedtotoAppelles' Appelles' Amended Amended Motion Motion for Summary Summary Judgment Judgment attempting attempting to to authenticate authenticate any any of the the summary summary judgment judgment evidence. (C.R. 26 evidence. (C.R. 26 -- 141). 141). Accordingly, Accordingly,Appellees' Appellees'summary summary judgment judgment evidence evidence admissible as summary judgment was not authenticated and should not have been admissible evidence. See Blanche Blanche v. First First Nationwide Nationwide Mortg. Corp, Corp., 74 S.W.3d S.W.3d 444, 451 43 43 (Tex. App.--Dallas (Tex. App.--Dallas 2002, 2002, no no pet.). Accordingly, the trial court pet.). Accordingly, court erred in granting granting Appellees' Amended Motion for Summary Judgment. Conclusion E. Conclusion It is clear that fact issues exist regarding Patel's claims claims for fraud, breach of contract, contract, breach breach of fiduciary fiduciary duty, conversion, for duty, conversion, for violations violations of Theft of the Texas Theft Liability Liability Act, Act, and for declaratory and for declaratory relief. relief. The Thesummary summaryjudgment judgment evidence evidence establishes establishes fact fact issues issues regarding regarding each each of Patel's claims, of Patel's claims, Appellees' Appellees' statute statute of limitations defense, limitations defense, Patel’s fraudulent concealment Patel's fraudulent concealment defense, defense, and and Patel’s Patel's claim for damages. The damages. Thetrial trialcourt's court'ssummary summary judgment judgment ruling ruling was was unwarranted, unwarranted, improper improper and constitutes reversible error. PRAYER forth herein, For the reasons set forth herein, Appellant, Appellant, Patel, respectfully requests pray that this Honorable Court reverse the summary judgment granted by the trial court in its entirety and remand this case to the trial court for a trial on the merits. 44 44 Respectfully submitted, /s/ Chris M. 7) /4/ &4414711, Portner oftea et Chris M. Portner State Bar No.: 24007858 cportner@portnerbond.com cportner@portnerbond. corn J. Trenton Bond State Bar No.: 00785707 tbond@portnerbond.com P ORTNER ♦. B PORTNER OND, PLLC BOND, PLLC 1905 Calder Avenue Beaumont, Texas 77701 Telephone: (409) 838-4444 (409) 554-0240 Facsimile: (409) Anthony Malley, III State Bar No.: 24041382 tony@mallaw.com MALLEY LLAW MALLEY AW FFIRM, IRM, PLLC PLLC 905 Orleans, Suite 110 Beaumont, Texas 77701 Telephone: (409) 212-8888 (409) 212-8002 Facsimile: (409) 212-8002 Jamie Matuska MATUSKA L MATUSKA AW F LAW FIRM IRM State Bar No.: 24051062 jjamie@matuskalaw.com amie@matuskalaw. corn 2809 Highway 69 North Nederland, Texas 77627 Telephone: (409) 722-5600 (409) 727-1290 Facsimile: (409) 45 CERTIFICATE OF SERVICE correct copy of the I certify that on October 12, 2015, a true and correct the foregoing foregoing instrument was instrument was provided provided to to all known known counsel counsel of record in accordance accordance with the Texas Rules of Civil Procedure. David Gaultney MehaffyWeber, P.C. 823 Congress Avenue, Suite 200 Austin, Texas 78701 David E. Bernsen Christine L. Stetson Bernsen Law Firm 420 North MLK, Jr., Pkwy Beaumont, Texas 77701 Glen W. Morgan John Werner Reaud, Morgan & Quinn, LLP P.O. Box 26005 Beaumont, Texas 77720-6005 /s/ Chris 712, /4/ &wad M. Peewit Portner Chris M. Portner 46 46 CERTIFICATE OF COMPLIANCE This document complies with the typeface requirements of TEX. R. APP. P. 9.4(e), it has been prepared in a conventional typeface no smaller than 14-point for text and no smaller than 12-point for footnotes. This document footnotes. This document also complies with the word-count limitations limitations of TEX. R. APP. P. 9.4(i)(3) because it contains 7,034 words. /s/ Chris M. 7) /4/ &4414711, Portner oftea et Chris M. Portner 47 47 NO. 13-15-00452- CV IN THE THIRTEENTH COURT OF APPEALS CORPUS CHRISTI-EDINBURG, TEXAS __________________________________________________________________ SANDEEP PATEL, Appellant v. HARBOR HOSPICE OF BEAUMONT, L.P., ET AL, Appellees __________________________________________________________________ 172nd Judicial District Court of Jefferson County, Texas On Appeal from the 172nd Trial Court Cause No. E-192,576 The Honorable Donald J. Floyd, Presiding __________________________________________________________________ APPENDIX TO BRIEF OF APPELLANT __________________________________________________________________ TAB A June 2015 Order June 18, 2015 Order on onDefendants' Defendants’ Amended Amended Motion Motion for for Summary Summary Judgment FILED DISTRICT CLERK OF TAB A JEFFERSON CO TEXAS 6/18/2015 2:29:33 PM JAMIE SMITH DISTRICT CLERK CAUSE NO. CAUSE E-192, 576 NO. E-192, E-192576 SANDEEP PATEL § IN THE DISTRICT COURT OF § vs. VS. § JEFFERSON COUNTY, TEXAS § HARBOR HOSPICE OF § BEAUMONT, L.P., ET AL § 172nd nJDICIAL JUDICIAL DISTRICT COURT ORDER ON DEFENDANTS' AMENDED MOTION FOR SUMMARY JUDGMENT 1"'# On ---¥~~-___:1:.......::8::._. i 8_______, 2015 the Court Court considered considered Qamar Arfeen, Harbor H H pice piceofofBeaumont BeaumontLP, LP,Harbor HarborHospice HospiceManagers, Managers, LLC LLC and and Arfeen Arfeen Properties, for Summary Judgment, and ORDERS that Defendants' Motion is in all LLP's Amended Motion for things GRANTED. GRANTED. Plaintiff's Plaintiff'sclaims claimsare aredismissed in their entirety dismissed in All other relief not herein herein granted granted isis expressly expresslydenied. denied. This ThisOrder Order is is final final and and appealable. ,.i( SIGNED /8 on this 18 day SIGNEDonthis ~d of C: dayof ~ )
Document Info
Docket Number： 13-15-00452-CV
Filed Date： 10/13/2015
Precedential Status： Precedential
Modified Date： 9/30/2016