Richard A. Myers v. Southwest Bank ( 2014 )

COURT OF APPEALS
SECOND DISTRICT OF TEXAS
FORT WORTH
NO. 02-14-00122-CV
RICHARD A. MYERS APPELLANT
V.
SOUTHWEST BANK APPELLEE
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FROM THE 236TH DISTRICT COURT OF TARRANT COUNTY
TRIAL COURT NO. 236-265286-13
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MEMORANDUM OPINION 1
----------
Appellant Richard Myers appeals from a summary judgment for Appellee
Southwest Bank on its deficiency claim against him. In four points, Myers
challenges the sufficiency of the evidence supporting the judgment as to
Southwest’s deficiency claim and the award of attorney’s fees, as well as the trial
court’s finding that he had waived his right to a fair market value determination
1
See Tex. R. App. P. 47.4.
and offset as provided in property code section 51.003. 2 Because we hold that
the evidence supports the summary judgment and that the trial court did not err
by granting summary judgment despite Myers’s pleading the application of
section 51.003, we affirm.
Background
Myers is the chief executive officer of Realty Capital Wichita Falls, L.P.
(Realty LP), which is the general partner of Realty Capital Partners, LLC (Realty
LLC). In 2008, Realty LP borrowed $1,800,000 from Southwest under a note
signed by Myers in his capacity as Realty LP’s CEO. The note was secured by a
deed of trust on property in Wichita County, Texas. Myers also signed a
guaranty in connection with the loan.
In April 2013, Southwest sold the Wichita County property at a nonjudicial
foreclosure sale and applied the proceeds of the sale to the unpaid balance on
the note. Southwest then filed suit against Myers for breach of the guaranty,
seeking to recover the deficiency on the note. Southwest also sued Realty LP
and Realty LLC but subsequently nonsuited both entities.
Southwest filed a traditional motion for summary judgment on its claim
against Myers. It also sought summary judgment on its claim for attorney’s fees.
Myers amended his answer and filed a response to the summary judgment
motion. In his amended answer, he requested the court to determine fair market
2
Tex. Prop. Code Ann. § 51.003 (West 2014).
2
value of the property on the date of foreclosure as provided in section 51.003 and
to offset the deficiency amount by the amount that the fair market value
exceeded the foreclosure sale price. In Myers’s summary judgment response,
he stated that he had a statutory right to an offset under section 51.003, and that
because he had requested a fair market value determination and offset under
that section, “a fact issue exists” as to the amount of any deficiency.
The day before the summary judgment hearing, Southwest filed a reply to
Myers’s summary judgment response. In that reply, Southwest argued that the
guaranty contained language providing that Myers had waived his right to a
section 51.003 offset.
The trial court granted judgment for Southwest, ordering that Southwest
recover from Myers $420,633.24 plus interest, $5,000 in attorney’s fees, and an
additional amount of conditional appellate attorney’s fees. Myers now appeals.
Standard of Review
We review a summary judgment de novo. 3 We consider the evidence
presented in the light most favorable to the nonmovant, crediting evidence
favorable to the nonmovant if reasonable jurors could and disregarding evidence
contrary to the nonmovant unless reasonable jurors could not. 4 We indulge
3
Travelers Ins. Co. v. Joachim, 315 S.W.3d 860, 862 (Tex. 2010).
4
Mann Frankfort Stein & Lipp Advisors, Inc. v. Fielding, 289 S.W.3d 844,
848 (Tex. 2009).
3
every reasonable inference and resolve any doubts in the nonmovant’s favor. 5 A
plaintiff is entitled to summary judgment on a cause of action if it conclusively
proves all essential elements of the claim. 6
Analysis
Myers argues in his first point that the trial court erred by granting
Southwest’s summary judgment motion over his objections because the motion
was not supported by sufficient evidence. We therefore look at the evidence
relied on by Southwest in the light most favorable to Myers to see if Southwest
established all essential elements of its deficiency claim. 7 Myers argues that the
evidence supporting Southwest’s breach of guaranty claim was conclusory,
based on hearsay, and not based on personal knowledge.
To support its breach of guaranty claim, Southwest attached to its motion
the affidavit of Jerry Hendrix, senior vice president at Southwest. Hendrix
attached to his affidavit copies of the promissory note, deed of trust, guaranty,
and the deed from the foreclosure sale.
In Hendrix’s affidavit, he stated that he is one of the custodians of records
at Southwest and that all the exhibits attached to his affidavit were kept in the
5
20801, Inc. v. Parker, 249 S.W.3d 392, 399 (Tex. 2008).
6
See Tex. R. Civ. P. 166a(a), (c); MMP, Ltd. v. Jones, 710 S.W.2d 59, 60
(Tex. 1986).
7
See Tex. R. Civ. P. 166a(a), (c); Fielding, 289 S.W.3d at 848; MMP, Ltd.,
710 S.W.2d at 60.
4
regular course of Southwest’s business. He stated that he had personal
knowledge of the facts set out in his affidavit by virtue of his position with
Southwest, his review of the relevant files, and his personal dealings with the
matter.
Hendrix asserted that at the time of the foreclosure sale, the balance owed
on the note was $1,604,813.09, plus $32,924.39 in interest; that Southwest
purchased the property at the foreclosure sale for a credit bid of $1,100,000,
resulting in a deficiency of $504,813.09; and that the current amount of accrued
interest was $47,677.85. Hendrix further stated that under the guaranty, Myers
agreed to be jointly and severally liable for up to $400,000 of the principal plus
interest and attorney’s fees incurred in enforcing the guaranty. He stated that on
February 27, 2013, Southwest had made a demand on Myers for payment under
the guaranty.
The copy of guaranty attached to the affidavit stated that Myers
guaranteed the prompt and full payment of the note, provided, however, that his
obligation under the guaranty “shall be $400,000 in principal” plus interest that
accrued from the date that Southwest made demand on him for payment. And
Myers agreed in the guaranty to pay on demand “all reasonable attorneys’ fees
incurred by [Southwest] in connection with the enforcement and/or collection” of
the guaranty.
Myers argues that Hendrix’s statements about the outstanding balance are
not supported by the documents attached to his affidavit, that the record does not
5
contain documentation showing the outstanding balance on the note at the time
of foreclosure, and that Hendrix’s testimony was therefore conclusory. He
asserts that Realty LP “presumably” paid Southwest $668,308.80 under the note,
and the record does not include any default letters sent to Realty LP.
This court has held that “[a] lender need not file detailed proof [of] the
calculations reflecting the balance due on a note; an affidavit by a bank
employee which sets forth the total balance due on a note is sufficient to sustain
an award of summary judgment.” 8 Thus, the fact that Southwest did not provide
documentation of how it calculated the outstanding balance did not in and of itself
make its evidence conclusory or insufficient as to the amount of the outstanding
balance.
Myers concedes that a bank officer may testify about an outstanding loan
balance, but he counters that the affidavit “must affirmatively show how the
affiant became personally familiar with the facts,” and Hendrix does not say what
he reviewed in the file, if anything, to make his determination. But Hendrix stated
that he had reviewed the bank’s file and had personally dealt with the matter. He
8
Energico Prod., Inc. v. Frost Nat’l Bank, No. 02-11-00148-CV, 2012 WL
254093, at *5 (Tex. App.—Fort Worth Jan. 26, 2012, pet. denied) (mem. op.);
see also Martin v. First Republic Bank, Fort Worth, N.S., 799 S.W.2d 482, 485
(Tex. App.—Fort Worth 1990, writ denied).
6
therefore provided the basis for his opinion. He was not required to detail which
specific documents he had reviewed. 9
Myers also argues that Hendrix needed to provide supporting documents
to support his statement that the property sold at foreclosure for $1,100,000. He
contends that based on the language of the foreclosure deed, Southwest “could
have bid” $1,650,000, thereby satisfying the note in full. And he argues that to
the extent Hendrix’s testimony is based on the foreclosure deed, it is hearsay.
But Southwest did not need to consult the foreclosure deed to tell it how much it
had bid at the sale. Hendrix, like any other corporate employee, is presumed to
know the facts that he would learn in the usual course of his job. 10 The amount
that Southwest bid at foreclosure is information that Hendrix would learn by virtue
of his position as a senior vice president and by reviewing Southwest’s files.
In a reply brief, Myers cites an opinion from this court for the well-
established rule that “[i]f uncontroverted summary judgment evidence is from an
interested witness, it does nothing more than raise a fact issue unless it is clear,
positive and direct, otherwise credible and free from contradictions and
9
See Energico Prod., 2012 WL 254093, at *6 (stating that “[a] corporate
employee is generally presumed to possess personal knowledge of facts that he
or she would learn in the usual course of employment without having to
otherwise prove personal knowledge”).
10
See id.
7
inconsistencies, and could have been readily controverted.” 11 Myers emphasizes
the “interested witness” language in that rule.
We agree that our prior opinion correctly stated the law regarding the
testimony of an interested witness. But Myers does not point out how Hendrix’s
testimony falls outside of the “unless” part of the rule. As set out in the summary
judgment rule, the affidavit of an interested witness can support summary
judgment when it is “clear, positive and direct, otherwise credible and free from
contradictions and inconsistencies, and could have been readily controverted.” 12
The only argument Myers makes about why, as an interested witness,
Hendrix’s affidavit cannot support summary judgment is that the foreclosure deed
does not corroborate Hendrix’s testimony because that deed states that the
property was sold to Southwest for “an amount in excess of . . . $1,000.00 . . .
and other good and valuable consideration paid as a credit upon the obligation
secured by the Deed of Trust, in compliance with the terms thereof.” Myers cites
a case from this court in which we held that a fact issue existed because an
affidavit supporting a summary judgment motion was directly contradicted by
evidence attached to that affidavit. 13
11
See Travelers Ins. Co. v. Bosler, 906 S.W.2d 635, 645 n.7 (Tex. App.—
Fort Worth 1995), pet. granted, judgm’t vacated w.r.m., 938 S.W.2d 716 (Tex.
1997).
12
Tex. R. Civ. P. 166a(c).
13
FFP Mktg. Co., Inc. v. Long Lane Master Trust IV, 169 S.W.3d 402, 410
(Tex. App.—Fort Worth 2005, no pet.).
8
But although the foreclosure deed attached to Hendrix’s affidavit does not
confirm Hendrix’s affidavit testimony that the property was sold for a credit bid of
$1,100,000, it also does not contradict Hendrix’s testimony. FFP is therefore
inapplicable. Myers does not point out any way that Hendrix’s testimony was not
clear, positive, and direct, was not free from contradictions and inconsistencies,
and could not have been readily controverted, and we do not see any such
problems with his testimony. We hold that Hendrix’s testimony was sufficient to
establish the outstanding balance on the note at the time of foreclosure and the
amount that Southwest paid at the foreclosure and credited on the note. We
overrule Myers’s first point.
In his second point, Myers argues that the trial court erred by denying his
right under property code section 51.003 to have any deficiency reduced by the
fair market value of the property because that issue was not before the trial court
when it granted summary judgment for Southwest. Myers’s specific complaint
under this point arises from the timing of Southwest’s reply to his summary
judgment response. He argues that Southwest did not timely address his
defense under 51.003 in its motion for summary judgment or response, and
therefore the trial court could not have properly granted summary judgment
against him on the defense.
After Southwest filed its summary judgment motion, Myers amended his
answer and filed a summary judgment response raising section 51.003.
9
Southwest’s reply to his response pointed out the following provisions of the
guaranty he had signed:
Bank may at any time, without the consent of or notice to
Guarantor, without incurring responsibility to Guarantor and without
impairing, releasing, reducing[,] or affecting the obligations of
Guarantor hereunder: . . . (iii) sell, exchange, release, surrender,
subordinate, realize upon[,] or otherwise deal with in any manner
and in any order any collateral for all or any part of the Guaranteed
Indebtedness or this Guaranty or setoff against all or any part of the
Guaranteed Indebtedness. . . .
....
. . . Guarantor hereby further waives and releases all claims,
causes of action, defenses[,] and offsets for any act or omission of
Bank, its directors, officers, employees, representatives[,] or agents
in connection with Bank’s administration of the Guaranteed
Indebtedness, except for Bank’s willful misconduct and gross
negligence.
....
Guarantor agrees that its obligations under this Guaranty shall
not be released, diminished, impaired, reduced[,] or affected by the
occurrence of any one or more of the following events: . . . (iv) the
taking or accepting of any collateral for all or any part of the
Guaranteed Indebtedness or this Guaranty; . . . (x) any other
circumstance which might otherwise constitute a defense available
to, or discharge of, Borrower, Guarantor[,] or any other guarantor of
all or any part of the Guaranteed Indebtedness.
Southwest argued that by this language, Myers had waived section 51.003’s right
to an offset.
This reply was filed the day before the summary judgment hearing. At the
hearing, the trial court heard arguments related to the reply and stated that it took
10
judicial notice of the reply. In its judgment, the trial court specifically found that
Myers had waived his right under section 51.003.
Southwest’s summary judgment motion did not address Myers’s section
51.003 defense—a defense Myers did not plead until after Southwest had
already filed the motion. Myers contends that under rule 63 of the rules of civil
procedure, 14 Southwest could not file its reply addressing his defense as late as
it did without leave of court. And Myers contends that because Southwest’s
motion did not address section 51.003, and because its reply was filed too close
to the summary judgment hearing, there were no summary judgment grounds
addressing section 51.003. As Myers points out, summary judgment may not be
granted on a ground not included in a motion. 15
Southwest counters Myers’s point with several arguments, including an
argument that Myers failed to bring forward any evidence on his affirmative
defense, and therefore his assertion of section 51.003 could not defeat its right to
summary judgment. We agree.
Section 51.003 provides an affirmative defense to the traditional deficiency
calculation based on the amount of a foreclosure sale. 16 When a party invokes
14
Tex. R. Civ. P. 63.
15
McConnell v. Southside I.S.D., 858 S.W.2d 337, 341 (Tex. 1993).
16
Moayedi v. Interstate 35/Chisam Rd., L.P., 438 S.W.3d 1, at 6 (Tex.
2014) (stating that section 51.003 provides a defense to the traditional definition
of deficiency, which is based on the foreclosure proceeds, in the form of “an
offset that otherwise would not be available”); Waterway Ranch, LLC v. Tex.
11
section 51.003, the parties must provide the trial court with evidence of the
property’s fair market value at the time of the foreclosure sale. 17 This evidence
can include (but is not limited to) evidence of comparable sales, cost of sale, and
expert opinion testimony. 18 If no competent evidence is provided to the trial
court, the court must use the sale price at the foreclosure sale to compute the
deficiency. 19
A party relying on an affirmative defense such as section 51.003 to avoid
summary judgment must produce evidence that raises a fact issue on each
element of the affirmative defense. 20 Because Myers was relying on section
51.003 to avoid Southwest’s right to a deficiency judgment based on the
foreclosure sale price, he had the burden to produce evidence of the fair market
value. Myers did not, however, produce any evidence of fair market value.
Because Myers had the burden to produce evidence on his affirmative
defense but did not do so, by statute the trial court had to use the foreclosure
Bank Fin., No. 02-13-00350-CV, 2014 WL 1389752, at *2, *4 (Tex. App.—Fort
Worth Apr. 10, 2014, pet. dism’d) (mem. op.) (stating that the section 51.003
offset is an affirmative defense).
17
Tex. Prop. Code Ann. § 51.003(b).
18
Id.
19
Id. § 51.003(c).
20
Brownlee v. Brownlee, 665 S.W.2d 111, 112 (Tex. 1984).
12
sale price to compute the deficiency. 21 Accordingly, the trial court did not need to
consider whether Myers had waived his section 51.003 defense because even if
Myers did not waive the defense by signing the guaranty, 22 he failed to meet his
burden on the affirmative defense. 23 Accordingly, the trial court did not err by
determining the amount of the deficiency based on the foreclosure sale price.
In his reply brief, Myers disputes Southwest’s reading of Bauer v. Jasso 24
regarding the burden of proof on an affirmative defense in the context of a
summary judgment. Southwest cited this case for the proposition that a plaintiff
moving for summary judgment may ignore an affirmative defense pled by the
nonmovant defendant. It argued that a party who relies on an affirmative
defense to defeat summary judgment must come forward with summary
judgment evidence to raise a fact issue on each element of that defense. Myers
counters that “Bauer actually held the opposite of what Appellee contends, and
Appellee certainly cannot ignore Appellant’s affirmative defense.”
As Myers points out in his brief, the court of appeals in Bauer held that “the
trial court improperly required Bauer to prove his affirmative defense before
21
Id.
22
See Moayedi, 438 S.W.3d, at 6 (holding that the offset right under
property code section 51.003 is a defense that may be waived and that by
signing the guaranty agreement at issue, Moayedi waived section 51.003).
23
See Brownlee, 665 S.W.2d at 112.
24
946 S.W.2d 552, 555 (Tex. App.—Corpus Christi 1997, no writ).
13
trial.” 25 But Southwest does not argue that Myers was required to prove his
affirmative defense to defeat its right to summary judgment. It argues that Myers
was required to raise a fact issue on his affirmative defense, which is exactly the
standard set out by the Corpus Christi court of appeals in Bauer. 26 To the extent
that Myers argues that under the law, he had no burden to raise a fact issue on
his affirmative defense once Southwest showed its entitlement to judgment, he is
simply wrong. 27
Myers then argues that Southwest’s own summary judgment evidence
raised a fact issue on his affirmative defense because “[a]n alleged deficiency
exists” between the foreclosure sale price and the outstanding balance on the
note. But the evidence that a deficiency exists is not the kind of evidence
required under section 51.003. 28 Section 51.003 presumes a deficiency, and the
question is how the deficiency should be calculated. Myers was required to
produce evidence on the property’s fair market value at the time of foreclosure,
and if he did not do so, the trial court had to use the foreclosure sale price. 29 The
fact that a deficiency existed between how much the property sold for at
25
Id. at 556.
26
Id. at 555.
27
See Brownlee, 665 S.W.2d at 112.
28
See Tex. Prop. Code Ann. § 51.003.
29
Id.
14
foreclosure and the outstanding balance does not provide evidence of the fair
market value of the property.
Myers then argues in his reply brief that by amending his answer to assert
section 51.003, he established his right to have a deficiency calculation
performed and offset, and therefore “the damages portion of the summary
judgment were no longer properly before the trial court.” The proceedings in this
case are distinguishable from Sosa v. Central Power & Light, 30 on which Myers
relies. In that case, the defendants filed a motion for summary judgment on the
ground of limitations. A defendant seeking summary judgment on the defense of
limitations has the burden to establish that defense. 31 The defendants in Sosa
attempted to meet their burden by arguing that the plaintiffs’ own pleadings
established that the plaintiffs’ claims were barred by limitations. 32 The plaintiffs
then amended their petition to remove the statements on which the defendants
had relied in their motion. The defendants’ motion, which was based entirely on
the plaintiffs pleading themselves out of court, no longer had any basis.
Summary judgment was therefore improper. 33
30
909 S.W.2d 893, 895 (Tex. 1995).
31
See Canada v. Canada, No. 02-11-00483-CV, 2013 WL 1759894, at *2
(Tex. App.—Fort Worth Apr. 25, 2013, no pet.) (mem. op.).
32
Sosa, 909 S.W.2d at 894.
33
Id. at 895.
15
Here, Southwest’s allegations about the existence of a deficiency or the
amount of the deficiency were not based on anything Myers said or did not say in
his answer or amended answer. Its summary judgment motion was based on its
own pleadings and evidence. Sosa does not help Myers. We overrule Myers’s
second point.
In Myers’s third point, he argues that the trial court erred by denying his
right under section 51.003 because he did not waive that right when he signed
the guaranty. Because we have held that Myers failed to present evidence to
raise a fact issue on his affirmative defense under section 51.003, we need not
consider his third point. 34
Myers’s fourth and final point is that the trial court erred by granting
Southwest its attorney’s fees because Southwest failed “to provide timesheets or
other sufficient evidence documenting its attorney’s fees and there are
controverting affidavits regarding the reasonableness of attorney’s fees.” Citing
the Supreme Court of Texas’s El Apple case, 35 Myers contends that Southwest’s
attorney was required to produce time sheets to be entitled to an award of fees.
This court has declined to extend El Apple to require time records in all
cases in which an attorney uses the attorney’s hourly rate to calculate the fee. In
ordinary hourly-fee breach of contract cases, “[t]ime sheets or other detailed hour
34
See Tex. R. App. P. 47.1.
35
El Apple I, Ltd. v. Olivas, 370 S.W.3d 757, 764 (Tex. 2012).
16
calculations are not required if the testimony regarding the hours of work required
is not speculative.” 36
In this was a breach of contract case, Southwest was not required to use
the lodestar method. 37 Southwest was entitled to recover a “reasonable” fee
under civil practice and remedies code section 38.001. 38 Testimony about the
reasonableness of a fee when supported by relevant Arthur Anderson factors is
generally sufficient to support an award. 39 And in a breach of contract case, a
trial court may “take judicial notice of the usual and customary attorney’s fees
and of the contents of the case,” and the trial court must presume that the usual
and customary attorney’s fee was reasonable unless that presumption was
rebutted. 40
Taplett’s affidavit did not attach time sheets. The affidavit did, however,
contain testimony about how many hours Taplett had worked on the foreclosure
and after the foreclosure, what tasks he had worked on after the foreclosure,
what his hourly rate is, that the rate is reasonable in the area for the service
36
Ferrant v. Graham Assocs., Inc., No. 02-12-00190-CV, 2014 WL
1875825, at *7, *8 (Tex. App.—Fort Worth May 8, 2014, no pet.) (mem. op.) (on
reh’g).
37
See id.
38
See Tex. Civ. Prac. & Rem. Code Ann. § 38.001 (West 2008).
39
Ferrant, 2014 WL 1875825, at *9 (citing Arthur Andersen & Co. v. Perry
Equip. Corp., 945 S.W.2d 812, 818 (Tex. 1997)).
40
See Tex. Civ. Prac. & Rem. Code Ann. §§ 38.003, 38.004 (West 2008).
17
performed, and that the number of hours spent were reasonable and necessary
in this type of case. He stated that he spent a total of “twenty-two (22) hours of
attorney time” between February 21, 2013, and April 25, 2013, “in connection
with the default by” Realty LP, Realty LLC, and Myers. He stated that he was
familiar with the usual and customary fees charged by attorneys of similar
experience in the area, and that the amount of time he spent and his hourly rate
of $225 an hour were necessary, reasonable, customary, and appropriate. He
listed some of the services he had performed after the foreclosure and an
estimate of the time he would need to spend to finalize and enforce any
judgment. Taplett concluded that in his opinion, $17,500 was a reasonable and
necessary attorney’s fee for the matter. This testimony was sufficient to support
the trial court’s award. 41
Myers asserts in his reply brief that Taplett used the lodestar method to
calculate his fee, and under El Apple, Southwest was therefore required to
produce timesheets. In Long v. Griffin, the Supreme Court of Texas
characterized the fee calculation used in the case as a lodestar fee because the
two attorneys in the case “relat[ed] the hours worked . . . multiplied by their hourly
rates for a total fee.” 42 Thus, Myers argues that because Taplett used his hourly
fee and number of hours worked in testifying about the reasonableness of his
41
See Ferrant, 2014 WL 1875825, at *9.
42
442 S.W.3d 253, 255 (Tex. 2014).
18
fee, the production of time sheets was required. But Myers is mistaken about the
Supreme Court’s documentary requirements for lodestar fee cases, even if we
characterized the fee in this case as a lodestar fee.
In City of Laredo v. Montano, the Supreme Court of Texas specifically
stated that El Apple does not require an attorney seeking fees to produce time
sheets. 43 Rather, El Apple states that to be awarded a fee based on the lodestar
method, the attorney will usually need to keep time records. 44 An attorney’s
testimony about his or her work can establish a fee under the lodestar method,
and therefore time records or billing statements are not strictly necessary. 45 But
“‘in all but the simplest cases, the attorney would probably have to refer to some
type of record or documentation to provide th[e] information’” about the work
performed by the attorney. 46 In other words, without documenting the work done
and the time spent, an attorney would usually not be able to accurately testify
about such matters. Accordingly, “attorneys using the lodestar method to shift
their fee to their opponent” are encouraged by the Supreme Court “to keep
contemporaneous records of their time as they would for their own client.” 47 The
43
414 S.W.3d 731, 736 (Tex. 2013).
44
See id.
45
Id.
46
Id. (citation omitted).
47
Id.
19
court in Montano went on to uphold a fee award based on the attorney’s
testimony, not documentary evidence produced in the trial court. 48 Thus,
characterizing the attorney fee award as a lodestar fee would mean that Taplett
was probably required to keep track of his time spent on the case—and his
affidavit testimony includes the hours he worked on a number of tasks, indicating
that he kept track of his time—but he was not required to produce the record of
his time.
Myers also argues that Taplett was required to but failed to segregate his
fees for the work performed in prosecution of Southwest’s claims against Myers,
Realty LP, and Realty LLP. In response, Southwest argues that segregation was
not required because the fees were incurred in connection with claims arising out
of the same transaction and were so interrelated that their prosecution entailed
proof of essentially the same facts. Southwest also argues that Myers failed to
preserve his complaint because he did not object to the lack of segregation.
Myers’s attorney’s affidavit pointed out that fees were not segregated, and
he mentioned in the middle of his argument at the summary judgment hearing
that there was no segregation of fees. It is not clear from the record, however,
whether the trial court sustained Myer’s objection, overruled it, or ignored it. 49
48
Id. at 737.
49
See Tex. R. App. P. 33.1(a).
20
But assuming that Myers preserved his complaint, we disagree that the award
was improper.
“A party seeking attorney’s fees must show that the fees were incurred on
a claim that allows recovery of such fees, and thus is ordinarily required to
segregate fees incurred on claims allowing recovery of fees from those that do
not” 50 and to segregate fees related to claims against different defendants when
the party has a claim for fees against only one of the defendants. 51 But
segregation is not required when legal services advance both recoverable and
unrecoverable claims 52 that “are dependent upon the same set of facts or
circumstances and thus are intertwined to the point of being inseparable.” 53
Fees must be segregated, however, when an attorney’s fees relate solely to a
claim for which the fees are unrecoverable. 54
50
Stewart Title Guar. Co. v. Aiello, 941 S.W.2d 68, 73 (Tex. 1997).
51
Stewart Title Guar. Co. v. Sterling, 822 S.W.2d 1, 10–11 (Tex. 1991)
(noting duty to segregate fees owed by settling defendants from nonsettling
defendants); City of Austin v. Roberson, No. 13-06-218-CV, 2008 WL 802315, at
*3 (Tex. App.—Corpus Christi Mar. 27, 2008, no pet.) (mem. op.) (noting fees
must be segregated among different defendants when fee claim is against only
one defendant).
52
Tony Gullo Motors I, L.P. v. Chapa, 212 S.W.3d 299, 313–14 (Tex.
2006).
53
Id. at 311; Aiello, 941 S.W.2d at 73 (quotation marks omitted).
54
Chapa, 212 S.W.3d at 313–14.
21
As Myers acknowledges, the lawsuit against all three original defendants
involved the same loan, note, property, and deed of trust. All the claims arose
out of the foreclosure of the property under the deed of trust. All the claims
involved a showing of the foreclosure and the resulting deficiency. The
prosecution of the claims against all three defendants entailed proof of
essentially the same facts and circumstances. 55
And as Myers notes in his reply brief, Taplett asserted that he spent
twenty-two hours on the foreclosure proceedings alone, which at his hourly rate
incurred $4,950 in fees, nearly the whole amount awarded. Taplett further stated
that in his opinion, it would take at least ten hours of time to finalize and enforce
any judgment rendered in Southwest’s favor. That testimony relates to tasks
performed in the claim against Myers and is sufficient to support the award. 56
Furthermore, Myers’s own attorney conceded that $5,000 would constitute
a reasonable fee. He stated in his controverting affidavit that “a reasonable fee
should not exceed $5,000.” Myers argues that this statement was not a
concession that a $5,000 fee would be reasonable, but we disagree. He
essentially stated that a reasonable fee could be as much as but not more than
$5,000, and that is exactly what the trial court awarded.
55
See Sterling, 822 S.W.2d at 10–11.
56
See Montano, 414 S.W.3d at 737 (observing that an attorney’s testimony
about her unbilled trial work was some evidence on which to base an award of
attorney’s fees “because it concerns contemporaneous or immediately completed
work for which she had not had time to bill, or presumably even record”).
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Finally, Myers argues that the award was erroneous because where there
are controverting affidavits regarding attorney’s fees, awarding attorney’s fees in
summary judgment is improper. But in his controverting affidavit, Myers’s
attorney conceded that a fee up to $5,000 could be a reasonable fee. Myers’s
attorney’s controverting affidavit therefore supported the amount of the trial
court’s award. We overrule Myers’s fourth issue.
Conclusion
Having overruled Myers’s fourth issue, we affirm the trial court’s judgment.
/s/ Lee Ann Dauphinot
LEE ANN DAUPHINOT
JUSTICE
PANEL: DAUPHINOT, GARDNER, and WALKER, JJ.
DELIVERED: December 11, 2014
23