Shihab Diais and Odessa Dental Solutions, P.A. v. Land Rover Dallas, L.P. and Snell Motor Company Operations GP, LLC, General Partner ( 2015 )

ACCEPTED
05-15-00115-CV
FIFTH COURT OF APPEALS
DALLAS, TEXAS
6/29/2015 8:40:19 AM
LISA MATZ
CLERK
No. 05-15-00115-CV
FILED IN
IN THE FIFTH 5th COURT OF APPEALS
DALLAS, TEXAS
COURT OF APPEALS 6/29/2015 8:40:19 AM
AT DALLAS, TEXAS LISA MATZ
Clerk
SHIHAB DIAIS AND ODESSA DENTAL SOLUTIONS, P.A.,
Appellants
v.
LAND ROVER DALLAS, L.P. AND SNELL MOTOR COMPANY
OPERATIONS GP, LLC, GENERAL PARTNER,
Appellees
Appeal from the 14th Judicial District Court, Dallas County, Texas,
Cause No. DC-13-01137-A, the Honorable Eric V. Moyé, Presiding
APPELLEES’ BRIEF
Wade C. Crosnoe
State Bar No. 00783903
E-mail: wcrosnoe@thompsoncoe.com
Sara Berkeley Churchin
State Bar No. 24073913
E-mail: schurchin@thompsoncoe.com
John W. Chambless, II
State Bar No. 00796334
E-mail: jchambless@thompsoncoe.com
THOMPSON, COE, COUSINS & IRONS, L.L.P.
701 Brazos, Suite 1500
Austin, Texas 78701
Telephone: (512) 703-5035
Facsimile: (512) 708-8777
Counsel for Appellees
IDENTITY OF PARTIES AND COUNSEL
1. Appellants/Plaintiffs Shihab Diais and Odessa Dental Solutions, P.A.
Trial and Appellate Counsel:
Jeffrey F. Thomason
Shane M. Bebout
Todd, Barron, Thomason, Hudman & Baxter P.C.
3800 E. 42nd Street, Suite 409
Odessa, Texas 79762-5982
Telephone: (432) 363-2103
Facsimile: (432) 363-2153
Email: Thomason@toddlawfirm.com
Email: SBebout@toddlawfirm.com
2. Appellees/Defendants Land Rover Dallas, L.P. and Snell Motor Company
Operations GP, LLC, General Partner
Trial and Appellate Counsel:
John W. Chambless, II
Thompson, Coe, Cousins & Irons, L.L.P.
701 Brazos, Suite 1500
Austin, Texas 78701
Telephone: (512) 703-5073
Facsimile: (512) 708-8777
Email: jchambless@thompsoncoe.com
Appellate Counsel:
Wade C. Crosnoe
Sara Berkeley Churchin
Thompson, Coe, Cousins & Irons, L.L.P.
701 Brazos, Suite 1500
Austin, Texas 78701
Telephone: (512) 703-5035
Facsimile: (512) 708-8777
Email: wcrosnoe@thompsoncoe.com
Email: schurchin@thompsoncoe.com
i
TABLE OF CONTENTS
IDENTITY OF PARTIES AND COUNSEL ........................................................................i
TABLE OF CONTENTS................................................................................................ ii
INDEX OF AUTHORITIES ...........................................................................................vi
STATEMENT REGARDING ORAL ARGUMENT...........................................................xi
ISSUES PRESENTED ................................................................................................. xii
I. Diais Did Not Preserve Error on His Proposed Jury Questions and
Instruction Because He Did Not Properly Object in the Trial Court
and Obtain a Written Ruling ......................................................................... xii
II. The Trial Court Properly Excluded Diais’ Proposed Jury Question on
Fraudulent Inducement Because No Evidence Supported Its
Submission .................................................................................................... xii
III. The Trial Court Properly Excluded Diais’ Negligent
Misrepresentation Claim Because It Is Barred by the Economic Loss
Rule and No Evidence Supports Its Submission .......................................... xii
IV. The Trial Court Properly Excluded a Jury Question for Invalidating
the As-Is Clause ............................................................................................ xii
V. The Trial Court Properly Excluded a Jury Question on
Unconscionable Conduct .............................................................................. xii
VI. The Trial Court Properly Excluded the Carfax Report (Diais’ Exhibit
No. 13). ......................................................................................................... xii
VII. Diais Was Not Entitled to a New Trial Based on His Alleged
Discovery of New Evidence ......................................................................... xii
VIII. The Evidence is Legally and Factually Sufficient to Support the Jury’s
Findings ........................................................................................................ xii
Statement of Facts ......................................................................................................1
I. Purchase of the Range Rover........................................................................... 1
ii
II. The Diaises Experience Trouble with the Vehicle’s Engine........................... 3
III. After Land Rover Dallas Repairs the Vehicle under Warranty, Diais
Disclaims Ownership of the Vehicle and Refuses to Pick It Up ..................... 4
IV. Diais Sues Land Rover Dallas ......................................................................... 6
Summary of the Argument.........................................................................................6
Argument....................................................................................................................8
I. Diais Did Not Preserve Error on His Proposed Jury Questions and
Instruction Because He Did Not Properly Object In the Trial Court
and Obtain a Written Ruling ............................................................................ 8
II. The Trial Court Properly Excluded Diais’ Proposed Jury Question on
Fraudulent Inducement Because No Evidence Supported Its
Submission .......................................................................................................9
A. The record contains no evidence that Land Rover Dallas made a
material misrepresentation that it knew to be false or with a
reckless disregard for the truth ............................................................10
1. The Range Rover was in fact new when sold to Diais. ............ 11
2. The record contains no evidence that Land Rover Dallas
made misrepresentations it knew to be false or with
reckless disregard for the truth..................................................14
B. The record contains no evidence of Land Rover Dallas’s
alleged fraudulent intent. .....................................................................16
C. The record contains no evidence that Diais relied on any alleged
misrepresentation in connection with the sale of the Range
Rover ...................................................................................................17
1. The “As-Is” Clause in the Contract Defeats the Element
of Reliance and Causation ........................................................18
2. Diais Admits That He Did Not Reply on Any
Representations In Connection With the Sale of the
Vehicle. .....................................................................................20
iii
D. The record contains no evidence that Diais was damaged as a
result of any alleged misrepresentations in connection with the
sale. ......................................................................................................22
III. The Trial Court Properly Excluded Diais’ Negligent
Misrepresentation Claim Because It Is Barred by the Economic Loss
Rule and No Evidence Supports Its Submission ...........................................23
A. The Economic Loss Rule Prevents Diais from Recovering in
Tort for What Is a Contract Claim ......................................................23
B. No Legally Sufficient Evidence Supported the Claim ........................24
1. Diais did not justifiably rely on any statements allegedly
made by Land Rover Dallas......................................................25
2. No evidence supports the element of damages in Diais’
negligent misrepresentation claim. ...........................................26
IV. The Trial Court Properly Excluded Jury Questions Relating to the
Enforceability of the As-Is Clause ................................................................26
V. The Trial Court Properly Declined to Submit a Jury Question on
Unconscionable Conduct ...............................................................................30
VI. The Trial Court Properly Excluded the Carfax Report (Diais’ Exhibit
No. 13). ..........................................................................................................32
VII. Diais Was Not Entitled to a New Trial Based on His Alleged
Discovery of New Evidence ..........................................................................35
A. Diais Did Not Properly Present His Newly-Discovered
Evidence Argument to the Trial Court; It Is Therefore Waived ......... 36
B. The Evidence Is Not New; It Is Based on Information Known to
Diais In Advance of Trial ....................................................................37
C. Diais Cannot Show That the Late Discovery of This Evidence
Was Not Due To His Lack of Diligence .............................................43
D. Diais’ “Newly Discovered” Evidence Is Not Material .......................46
iv
VIII. The Evidence Is Legally and Factually Sufficient to Support the Jury’s
Findings .........................................................................................................48
A. Standard of Review .............................................................................48
1. Legal Sufficiency ......................................................................48
2. Factual Sufficiency ...................................................................49
B. The Evidence Is Legally and Factually Sufficient to Support the
Jury’s Finding of No Liability on Diais’ Breach of Contract
Claim ...................................................................................................50
C. The Evidence Is Legally and Factually Sufficient to Support the
Jury’s Finding of No Liability on Diais’ DTPA Claim ......................53
PRAYER ....................................................................................................................55
CERTIFICATE OF COMPLIANCE ...............................................................................56
CERTIFICATE OF SERVICE .......................................................................................57
v
INDEX OF AUTHORITIES
Cases
Am. Eagle Ins. Co. v. United Techs. Corp.,
48 F.3d 142, 144 (5th Cir. 1995) .........................................................................24
Aquila Sw. Pipeline, Inc. v. Harmony Exploration, Inc.,
48 S.W.3d 225, 236 (Tex. App.—San Antonio 2001, pet. denied) .....................16
Autohaus, Inc. v. Aguilar,
794 S.W.2d 459, 463–64 (Tex. App.—Dallas) ...................................................15
Brewer v. Gen. Motors Corp.,
926 S.W.2d 774, 780 (Tex. App.—Texarkana 1996, no writ) ............................24
Bynum v. Prudential Residential Services, Ltd. Partnership,
129 S.W.3d 781, 788 (Tex. App. —Houston [1st Dist.] 2004, pet.
denied) ..................................................................................................................19
Carrow v. Bayliner Marine Corp.,
781 S.W.2d 691, 695 (Tex. App.—Austin 1989, no writ.) .................................16
Cason v. Taylor,
51 S.W.3d 397, 408 (Tex. App.—Waco 2001, no pet.) ......................................54
Chapman Custom Homes, Inc. v. Dallas Plumbing Co., 445 S.W.3d
716, 718 (Tex. 2014) ............................................................................................23
Chastain v. Koonce,
700 S.W.2d 579, 583–84 (Tex. 1985)........................................................... 30, 31
City of Keller v. Wilson,
168 S.W.3d 802, 809–10 (Tex. 2005)........................................................... 48, 49
Cleveland Reg’l Med. Ctr., L.P. v. Celtic Properties, L.C.,
323 S.W.3d 322, 339–41(Tex. App.—Beaumont 2010, pet. denied) ...................8
Dow Chem. Co. v. Francis,
46 S.W.3d 237, 241 (Tex. 2001) ............................................................. 48, 49, 52
Ellis Coutny State Bank v.Keever,
888 S.W.2d 790, 794 (Tex. 1994) ........................................................................50
vi
Fed. Land Bank Ass’n of Tyler v. Sloane,
825 S.W.2d 439, 442 (Tex. 1991) ........................................................................25
Formosa Plastics Corp. USA v. Presidio Engineers and Contractors,
Inc.,
960 S.W.2d 41, 46–47 (Tex. 1998) ......................................................................16
Golden Eagle Archery, Inc.v. Jackson,
116 S.W.3d 757, 762 (Tex. 2003) ........................................................................48
Grant Thornton LLP v. Prospect High Income Fund,
314 S.W.3d 913, 923 (Tex. 2010) ........................................................................17
Gross v. WB Texas Resort Communities, No.
02-12-00411, 2014 WL 7334950, at *7 (Tex. App.—Fort Worth
Dec. 23, 2014, no pet.) .........................................................................................23
Gym-N-I Playgrounds, Inc. v. Snider,
220 S.W.3d 905, 913 (Tex. 2007) ........................................................................18
Haase v. Glazner,
62 S.W.3d 795, 798–99 (Tex. 2001)....................................................................10
Herrera v. Seton Nw. Hosp.,
212 S.W.3d 452, 462–63 (Tex. App.—Austin 2006, no pet.) .............................45
Holley v. Watts,
629 S.W.2d 694, 696 (Tex. 1982) ........................................................................49
In re S.M.V.,
287 S.W.3d 435, 451 (Tex. App.—Dallas 2009, no pet.) ...................................38
In re Thoma,
873 S.W.2d 477, 512 (Tex. 1994) ........................................................................38
Ins. Co. of N. Am. v. Morris,
981 S.W.2d 667, 677 (Tex. 1998) ........................................................................30
Italian Cowboy Partners, Ltd. v. Prudential Ins. Co. of Am.,
341 S.W.3d 323, 33 (Tex. 2011) ..........................................................................10
Jackson v. Van Winkle,
660 S.W.2d 807, 809–10 (Tex. 1985)..................................................... 38, 45, 46
vii
Jim Walter Homes, Inc. v. Reed,
711 S.W.2d 617, 618 (Tex. 1986) ........................................................................24
Kirkpatrick v. Mem’l Hosp. of Garland,
862 S.W.2d 762, 769 (Tex. App.—Dallas 1993, writ denied) ..............................9
LAN/STV v. Martin K. Eby Constr. Co., Inc.,
435 S.W.3d 234, 238 (Tex. 2014) ........................................................................23
Lance v. USAA Ins. Co.,
934 S.W.2d 427, 429 (Tex. App.—Waco 1996, no writ) ....................................54
Larsen v. Carlene Langford & Assocs., Inc.,
41 S.W.3d 245, 253 (Tex.App.—Waco 2001, pet. denied) .................................18
Maritime Overseas Corp. v. Ellis,
971 S.W.2d 402,407 (Tex. 1998) .........................................................................50
McCamish, Martin, Brown & Loeffler v. F.E. Appling Interests,
991 S.W.2d 787, 791 (Tex. 1999) ........................................................................25
McGalliard v. Kuhlman,
722 S.W.2d 694, 697 (Tex.1986) .........................................................................49
Midcontinent Aircraft Corp. v. Curry County Spraying Serv., Inc.,
572 S.W.2d 308 (Tex. 1978) ................................................................................23
Mortiz v. Preiss,
121 S.W.3d 715 (Tex. 2003) ................................................................................46
Murray v. Ford Motor Co.,
97 S.W.3d 888, 890–93 (Tex. App.—Dallas 2003, no pet.) ...............................24
Neyland v. Raymond,
324 S.W.3d 646, 656 (Tex. App.—Fort Worth 2010, no pet.) ............................44
Nixon v. GMAC Mortg. Corp.,
No. 05-08-00256-CV, 2009 WL 2973660, at *3–4 (Tex. App.—
Dallas Sept. 18, 2009, no pet.) .............................................................................44
O’Connor v. Miller,
127 S.W.3d 249, 254 (Tex. App.—Waco 2003, pet. denied) ..............................54
viii
Ortiz v. Jones,
917 S.W.2d 770, 772 (Tex. 1996) ........................................................................49
Patriacca v. Frost,
98 S.W.3d 303, 307 (Tex. App. – Houston [1st Dist.] 2003, no pet.) .................45
Pipe Line Co., Inc. v. Tichacek,
997 S.W.2d 166, 172 (Tex. 1999) ........................................................................29
Pool v. Ford Motor Co.,
715 S.W.2d 629, 633–34 (Tex. 1986)..................................................................48
Prudential Ins. Co. of Am. v. Jefferson Assocs., Ltd.,
896 S.W.2d 156, 161 (Tex. 1995) ................................................................ passim
Prudential Ins. Co. of Am. v. Jefferson Assocs., Ltd.,
896 S.W.2d 156, 162 (Tex. 1995) ........................................................................14
Rivera v. Countrywide Home Loans, Inc.,
262 S.W.3d 834, 844 (Tex. App.—Dallas, no pet.)...................................... 38, 44
Rowlett/2000, Ltd. v. City of Rowlett,
231 S.W.3d 587, 590 (Tex. App.—Dallas 2007, no pet.) ...................................50
SelecTouch Corp. v. Perfect Starch, Inc.,
111 S.W.3d 830, 834 (Tex. App.—Dallas 2003, no pet.) ...................................16
Smith v. KNC Optical, Inc.,
296 S.W.3d 807, 811–12 (Tex. App.—Dallas 2009, no pet.) .............................16
Snider, 220 S.W.3d at 914 .......................................................................................19
Spencer v. Eagle Star Ins. Co. of Am.,
876 S.W.2d 154, 156 (Tex. 1994) ........................................................................29
Sterner v. Marathon Oil Co.,
767 S.W.2d 686, 690 (Tex. 1989) ........................................................................49
Sw. Bell Telephone Co. v. DeLanney,
809 S.W.2d 493, 495 (Tex. 1991) ........................................................................24
Sw. Elec. Power Co. v. Burlington N. R.R. Co.,
966 S.W.2d 467, 474 (Tex. 1998) ........................................................................35
ix
Tex. Dept. of Transp. v. Able,
35 S.W.3d 608, 617 (Tex. 2000) ..........................................................................29
Tienda v. State, 358 S.W.3d 633, 644–46 (Tex. Crim. App. 2012) ........................33
Transport Ins. Co. v. Faircloth,
898 S.W.2d 269, 276–77 (Tex. 1995)..................................................................15
Wackenhut Corp. v. Gutierrez,
453 S.W.3d 917, 920 (Tex. 2015) ....................................................................8, 28
Waffle House, Inc. v. Williams,
313 S.W.3d 796, 813 (Tex. 2010) ..................................................... 43, 46, 47, 48
Welwood v. Cypress Creek Estates, Inc.,
205 S.W.3d 722, 726 (Tex.App.—Dallas 2006, no pet.) ....................................18
Wilson,
168 S.W.3d at 819–20 ..........................................................................................54
Statutes
Tex. Bus. & Com. Code § 2.106 ..............................................................................63
Tex. Bus. & Comm. Code § 17.45(5) ......................................................................42
Tex. Bus. & Comm. Code § 2.102...........................................................................28
Other Authorities
Restatement (Second) of Torts § 552.......................................................................37
Tex. Occ. Code Ann. § 2301.002(14) ......................................................................23
Rules
Tex. R. App. P. 33.1(b) ............................................................................................48
Tex. R. App. P. 38.1(i) .............................................................................................45
Tex. R. App. P. 61.1.................................................................................................41
Tex. R. Civ. Proc. 324..............................................................................................48
x
STATEMENT REGARDING ORAL ARGUMENT
Appellees agree with Appellants that oral argument is not necessary to
determine the issues in this case, and therefore oral argument is not requested.
xi
ISSUES PRESENTED
I. Diais Did Not Preserve Error on His Proposed Jury Questions and
Instruction Because He Did Not Properly Object in the Trial Court and
Obtain a Written Ruling
II. The Trial Court Properly Excluded Diais’ Proposed Jury Question on
Fraudulent Inducement Because No Evidence Supported Its Submission
III. The Trial Court Properly Excluded Diais’ Negligent Misrepresentation
Claim Because It Is Barred by the Economic Loss Rule and No Evidence
Supports Its Submission
IV. The Trial Court Properly Excluded a Jury Question for Invalidating the As-
Is Clause
V. The Trial Court Properly Excluded a Jury Question on Unconscionable
Conduct
VI. The Trial Court Properly Excluded the Carfax Report (Diais’ Exhibit No.
13).
VII. Diais Was Not Entitled to a New Trial Based on His Alleged Discovery of
New Evidence
VIII. The Evidence is Legally and Factually Sufficient to Support the Jury’s
Findings
xii
STATEMENT OF FACTS
Diais’ perfunctory, argumentative, and conclusory statement of facts
contains more record citations without explanatory support than it does actual facts
about this case and its procedural background. Accordingly, Land Rover Dallas
presents this more detailed and complete statement of facts.
I. Purchase of the Range Rover
This case involves the sale and operation of a 2012 Range Rover sport utility
vehicle. Plaintiff, Dr. Shihab Diais, decided in 2012 to buy a new Range Rover for
his wife because they had previously owned a Range Rover vehicle that was his
wife’s “passion” (2 RR 119–20).1 He testified that they “didn’t need any
convincing” to make the purchase; “[they] wanted to stay with the Range Rover”
(2 RR 120–22). Having already made up their minds on the car they wanted, the
Diaises traveled by plane from their home in Odessa, Texas, to the Dallas Range
Rover Dealership with the intention to purchase a new vehicle (2 RR 121–22).
At Land Rover Dallas, the Diaises noticed a Range Rover on the sales room
floor that was “special,” because it had been equipped with an Amani 2 body kit,
1
Citations to the Reporter’s Record in this Brief will be as follows: [Volume] RR [Page
Number]. Citations to the Clerk’s Record in this Brief will be as follows: [Volume] CR [Page
Number]. The Reporter’s Record does not contain page numbers beyond Volume 3, so the trial
exhibits do not have page numbers. Hence, citations to the trial exhibits will be as follows:
“([Vol.] RR __, [P’s][D’s] [Exhibit Number]).”
2
The Reporter’s Record incorrectly refers to it as an “Armani” body kit (See 5 RR __, D’s Ex.
5).
1
complete with custom wheels, rims, and bumpers (2 RR 155–56; 3 RR 17). This
gave the car a “unique look” (3 RR 17).
Diais purchased the car jointly in his own name and the name of his dental
practice, Odessa Dental Solutions, P.A (2 RR 151). The purchase price of the
vehicle was $107,597.96 (2 RR 126; 4 RR __ P’s Ex. 1), and it came with a four-
year, 50,000-mile manufacturer’s warranty (3 RR 21, 6 RR __, D’s Ex. 21). Land
Rover Dallas, who was not the manufacturer of the vehicle, did not provide a
written warranty. (4 RR __, P’s Ex. 1 3; Attached as Apx. A). Land Rover Dallas
sold the vehicle “as is” and with no warranty other than that provided by the
manufacturer. (Id.)
Diais purchased the vehicle on a Saturday. He and Michael McGovern, a
sales guide at Land Rover Dallas, agreed that Land Rover Dallas would keep the
vehicle for a few days to wash it and make some touchups to the body paint (2 RR
123–24, 4 Supp. CR __4).
The following Wednesday, McGovern drove the Range Rover from Dallas
to Odessa, without incident, where he delivered it to Diais’ dental office (2 RR
123–25, 159–60). Diais has never complained about the condition of the Range
3
The Sales Agreement referred to in this citation can also be found at 1 CR 107 as an attachment
to Plaintiff’s Motion for New Trial.
4
Land Rover Dallas requested a supplemental clerk’s record on June 10th to include this
deposition testimony in the appellate record, but the clerk has not yet filed it. When it is filed,
Land Rover Dallas will file an amended brief with the corresponding record citations.
2
Rover when it was delivered or argued that the body of the Range Rover was
damaged prior to its delivery. (2 RR 158–59, 161).
Three days after the vehicle was delivered, the check engine light came on
(2 RR 132, 159). Mrs. Diais called Land Rover Dallas and spoke to the service
department. Gary Johnson, the dealer’s Service Manager, told her that the check
engine light is not a problem if it is not flashing and advised Mrs. Diais to bring the
vehicle by the dealership the next time she came to Dallas (2 RR 209–10). The
light soon turned off, however, and the vehicle ran fine (2 RR 211).
Diais subsequently drove the vehicle to Lubbock for a work conference with
no problem (2 RR 164–65, 211–12). However, during that trip, Diais drove the
vehicle through a severe West Texas thunder storm, which, according to his wife’s
testimony, caused damage to the body of the Range Rover (2 RR 222–23, 225).
II. The Diaises Experience Trouble with the Vehicle’s Engine
About two weeks later, the vehicle’s engine started making a loud “knocking
noise” (2 RR 133). The Diaises called Land Rover Dallas, which told him it would
have the car towed in at its own expense to diagnose the problem (2 RR 133).
When Land Rover Dallas had the vehicle towed to its repair shop, Wayne
Cloud, the Centre Manager of Land Rover Dallas, noticed damage to the vehicle,
including damage to its body, liner, undercarriage, windshield, and wheels (2 RR
3
218). Ms. Diais told Land Rover Dallas that the vehicle was damaged during the
storm Diais encountered on his way to Lubbock (2 RR 225).
As for the engine issue, Land Rover Dallas informed Diais that the vehicle
would require a new engine and that the dealership would be installing it, at no
charge to Diais, under the manufacturer’s warranty (2 RR 137). However, it was
explained to Diais that the body damage on the vehicle would not be covered under
the manufacturer’s warranty (2 RR 235). Diais’ insurance company sent an
adjuster to estimate the body damage, and he concluded that four separate claims
would have to be made on body damage (3 RR 7).5
III. After Land Rover Dallas Repairs the Vehicle under Warranty, Diais
Disclaims Ownership of the Vehicle and Refuses to Pick It Up
After Land Rover Dallas informed Diais that it was replacing the engine
under warranty, Diais emailed Cloud to say that his wife thought the vehicle was
“jinxed” and that he no longer wanted it (2 RR 170–71). Initially, Diais asked if he
could get his money back so he could buy a different Range Rover from Land
Rover Dallas (2 RR 173). Cloud explained that the dealership could not simply
5
The trial court refused to let Cloud testify before the jury regarding the number of insurance
claims made on the body damage to the Range Rover (3 RR 7). Counsel for Land Rover Dallas
made an offer of proof on the record, explaining that Cloud would testify that the four separate
insurance claims negatively affected the value of the Range Rover. In addition, Land Rover
Dallas would have offered insurance records containing correspondence between Diais and the
insurance company about the storm damage sustained by Diais’ Range Rover (Id.). Land Rover
Dallas also argued, during a pretrial hearing on a motion in limine regarding insurance, that this
evidence was relevant to show that a dispute arose between Diais and his insurance company
over the handling of the claim, and that this dispute was the real reason Diais decided he no
longer wanted the vehicle (2 RR 14-15).
4
take back Diais’ Range Rover because the body damage had significantly affected
its value and would have to be disclosed to subsequent purchasers (2 RR 231–34).
Cloud believed that the Range Rover was worth only $75,000 because of the body
damage (2 RR 235).
Cloud, however, proposed a few options to Diais, including providing him
an extended, 100,000-mile warranty or a “substitution of collateral” (trading his
vehicle for another Range Rover on the same note) but the bank refused to
substitute collateral due to the body damage the vehicle had sustained while in the
Diaises’ possession (2 RR 172–75, 231–32).
From that point on, Diais refused to pick up the vehicle, insisting repeatedly
that he no longer owned it (2 RR 174). As one email put it, “[t]his is no longer my
vehicle. It belongs to your dealership” (6 RR __, D’s Ex. 26). Diais, however,
continued to make payments on the vehicle and declared its depreciated value on
his federal income taxes (2 RR 180–81). Yet the vehicle, fully repaired, remained
parked at Land Rover Dallas. It remained there, unclaimed and unexamined by
Diais or his attorneys, for the two years preceding the filing of this lawsuit (2 RR
176).6
6
Because Diais never picked up his vehicle, he did not receive the Repair Order detailing the
repairs Land Rover Dallas made on his vehicle. Although Diais argues that Land Rover Dallas
“failed to disclose” to him that it made certain repairs to the vehicle—such as a battery
replacement—this information was available to Diais upon pickup of his vehicle (2 RR 252–53).
5
IV. Diais Sues Land Rover Dallas
In January 2013, rather than pick up the repaired vehicle, Diais and his
dental office (collectively “Diais”) sued Land Rover Dallas and its General
Partner, Snell Motor Company Operations GP, LLC (collectively, “Land Rover
Dallas”). Dias asserted claims under the Texas Deceptive Trade Practices Act
(“DTPA”), and for breach of contract, negligent misrepresentation, common law
fraud, and attorney’s fees (1 CR 5).
The case was tried to a jury. At the jury charge conference, the trial court
refused Diais’ proposed submissions on negligent misrepresentation and common
law fraud (1 CR 49, 70–77); (3 RR 10–12). Land Rover Dallas moved for a
directed verdict, which the trial court denied.
The jury returned a verdict against Diais on the liability theories submitted
to the jury: DTPA and breach of contract (1 CR 70–77). The trial court denied
Diais’ motion for judgment notwithstanding the verdict and granted a take nothing
judgment in favor of Land Rover Dallas (1 CR 95). The trial court denied Diais’
Motion for New Trial by operation of law, without a hearing (2 CR 4). This appeal
followed.
SUMMARY OF THE ARGUMENT
The trial court properly excluded Diais’ proposed jury questions on
fraudulent inducement and negligent misrepresentation because there is no
6
evidence to support all, let alone any, of the elements of those claims. Although
Diais’ brief is replete with unexplained string citations to the record purporting to
support the claims, he cannot point this Court to any evidence showing that Land
Rover Dallas made actual fraudulent or false misrepresentations of fact concerning
the condition of the Range Rover he purchased, much less that he justifiably relied
on any such misrepresentations in making the purchase. The record is likewise
bereft of any evidence that Land Rover Dallas had any intent to deceive Diais in
connection with the vehicle’s sale.
The evidence is both legally and factually sufficient to support the jury’s
verdict of no liability. The evidence presented at trial shows that Land Rover
Dallas sold and delivered to Diais a “new” Range Rover in accordance with the
terms of the parties’ contract, and repaired the Range Rover under warranty when
engine problems manifested several weeks after the sale. Diais sustained no
damages caused by a breach or by Land Rover Dallas’s conduct; rather, any
damages Diais suffered are a result of his refusal to pick up his repaired vehicle
from Land Rover Dallas.
Finally, Diais is not entitled to a new trial based on the discovery of alleged
“new” evidence. The fact that Land Rover Dallas painted the Range Rover before
delivering it to Diais in Odessa, Texas, was undisputedly known to Diais since he
purchased the car. The fact that an after-market custom body kit was added to the
7
Range Rover before purchase—complete with custom wheels and tires—was also
known to the Diaises since they first stepped foot inside Land Rover Dallas. Diais’
“new” evidence, which he obtained after the close of trial, could have been
obtained years ago, yet he failed to exercise due diligence in developing the issue
or evidence for trial. In any event, Diais’ argument that he is entitled to a new trial
is waived because an evidentiary hearing was not held on the “new” evidence as
the Texas Rules of Civil Procedure requires.
The judgment of the trial court should be affirmed.
ARGUMENT
I. Diais Did Not Preserve Error on His Proposed Jury Questions and
Instruction Because He Did Not Properly Object In the Trial Court and
Obtain a Written Ruling
Diais submitted to the trial court “Plaintiffs’ Request for Jury Questions and
Instructions” (1 CR 49–67). At the charge conference, however, Diais did not
make any objections to the jury charge and did not obtain a written ruling denying
his proposed submissions (3 RR 10–11). Thus, the record does not confirm that
“the trial court was aware of, and rejected” Diais’ proposed jury questions. See
Wackenhut Corp. v. Gutierrez, 453 S.W.3d 917, 920 (Tex. 2015); See Cleveland
Reg’l Med. Ctr., L.P. v. Celtic Properties, L.C., 323 S.W.3d 322, 339–41(Tex.
App.—Beaumont 2010, pet. denied) (holding that plaintiff failed to preserve
argument for appeal that trial court erred in failing to submit a jury question,
8
regardless of the fact that the plaintiff submitted a proposed jury question on the
issue, because plaintiff did not object at the charge conference to the trial court’s
failure to submit the jury question).
“[T]endering a proposed jury question or instruction will not suffice to
preserve error when a proper objection has not been made to the question or
instruction submitted.” Cleveland Reg’l, 323 S.W.3d at 341 (citing Kirkpatrick v.
Mem’l Hosp. of Garland, 862 S.W.2d 762, 769 (Tex. App.—Dallas 1993, writ
denied)). Because Diais’ issues 1–4 are not preserved for appellate review, this
Court need not reach them. Assuming arguendo that they are, however, none
serves as a basis for reversal. The issues are addressed in turn below.
II. The Trial Court Properly Excluded Diais’ Proposed Jury Question on
Fraudulent Inducement Because No Evidence Supported Its Submission
Diais argues that the trial court improperly excluded a jury question on
fraudulent inducement (Brief at p. 14). The record shows, however, that the trial
court properly excluded Diais’ fraud claim because there is no evidence to support
any of its elements.
The elements Diais had to show to support a jury question on a fraudulent
inducement claim are:
1. Land Rover Dallas made a material misrepresentation;
9
2. Land Rover Dallas knew that the misrepresentation was false when it
made it or Land Rover Dallas made the misrepresentation recklessly
without any knowledge of its truth and as a positive assertion;
3. Land Rover Dallas intended that Diais act on the misrepresentation;
4. Diais acted in reliance on the misrepresentation; and
5. Diais suffered injury thereby.
See Italian Cowboy Partners, Ltd. v. Prudential Ins. Co. of Am., 341 S.W.3d 323,
33 (Tex. 2011). “[T]he elements of fraud must be established as they relate to an
agreement between the parties.” Haase v. Glazner, 62 S.W.3d 795, 798–99 (Tex.
2001). Taking each in turn below, it is clear that Diais has no evidence to support
any, let alone all of these elements.
A. The record contains no evidence that Land Rover Dallas made a
material misrepresentation that it knew to be false or with a reckless
disregard for the truth
The only alleged misrepresentations Diais identifies are the following: (1)
Land Rover Dallas “represented that the Vehicle was in new condition. . . .
However, the Vehicle was not in new condition” (Brief at p. 15); and (2) Land
Rover Dallas “represented that the Vehicle was the most luxurious, rugged vehicle,
with a supercharged, high performance engine. . . . However, the Vehicle was in
reality unsafe and dangerous to drive, unable to detect whether there were engine
problems, unable to go over 30 miles per hour, and had serious abnormalities that
10
should not be in a vehicle in new condition, but were of a deteriorated condition”
(Id.).
First, Diais’ theory that Land Rover Dallas misled him into believing the car
was new is itself misleading. Essentially, Diais argues that because some
mechanical issues with his Range Rover surfaced not long after he bought the car
(all of which were covered under warranty), the car was he bought was not actually
“new”; it was “of a deteriorated condition.” He repeats this theme time and again
in his briefing. Taking it an illogical step further, Diais argues that these
unforeseen mechanical issues—all of which came to light after the sale of the
vehicle—rendered Land Rover Dallas’s statement that the vehicle was “new” when
sold a misrepresentation.
1. The Range Rover was in fact new when sold to Diais.
The Texas Occupations Code defines “New Motor vehicle” as “a motor
vehicle that has not been the subject of a retail sale regardless of the mileage of the
vehicle.” Tex. Occ. Code Ann. § 2301.002(14). The Range Rover here was new
when sold to Diais.
Not surprisingly, Diais never offered evidence to the contrary. Critically, he
offered no evidence to show that the Range Rover he purchased was not a “new”
car under the ordinary or statutory meaning of the term; in other words, that
anyone ever purchased and held title to the car before it was sold to him.
11
The unexplained string cites to the record that Diais relies on, but does not
discuss, reveal upon closer inspection the misleading nature of Diais’ conclusory
“fraudulent misrepresentation” argument. For example, he sets forth the following
record cites to support his argument that Land Rover Dallas fraudulently
misrepresented that the Range Rover he purchased was a new car when sold:
• Cited: 2 RR 131–33. What the record says:
o Diais testifies that he thought the vehicle was new, but he
started having problems with it the third day he owned it. He
notes that the vehicle would hesitate before starting, would not
exceed speeds of thirty miles per hour, and the engine “made a
very loud noise.”
• Cited: 2 RR 178. What the record says:
o Diais testifies that the Range Rover “was a deteriorated
vehicle” because “[w]ithin three weeks it needed a new
engine.”
• Cited: 3 RR 25. What the record says:
o Michael McGovern, Sales Guide at Land Rover Dallas,
testifies that on the day the Diaises came to the dealership, he
showed them only new vehicles, and represented to them that
the Range Rover they purchased was new.
12
None of the “evidence” Diais sets forth to support his misrepresentation
claim is actually evidence that (1) the Range Rover was not new when sold, and/or
(2) that Land Rover Dallas knew the Range Rover was not new or not “in new
condition” when it sold the vehicle to Diais. In fact, the only testimony given at
trial regarding whether the vehicle was actually “new” (in the ordinary sense of the
word) when Land Rover Dallas sold it indisputably shows that neither Land Rover
Dallas (nor any other dealership) had sold the Range Rover to anyone else before
they sold it to the Diaises (2 RR 237). Moreover, the jury heard testimony from
Diais’ deposition wherein he concedes that the statement was “not necessarily
false. It was a brand new vehicle . . .” (2 CR 164). He clarifies what he meant by
“deteriorated”: I mean, it just did not operate the way it was supposed to have” (2
RR 164). But even “new” vehicles can develop mechanical issues. Not only does
the record show a lack of evidence to support Diais’ allegation that Land Rover
Dallas made a misrepresentation concerning the newness of the Range Rover, the
evidence in the record conclusively proves that the vehicle Diais purchased was
actually new. Thus, Land Rover Dallas’s statements to Diais that the vehicle was
new are not, as a matter of law, misrepresentations of fact.
13
2. The record contains no evidence that Land Rover Dallas
made misrepresentations it knew to be false or with reckless
disregard for the truth.
Furthermore, no evidence supports Diais’ argument that because the Range
Rover experienced mechanical problems three days after purchase, Land Rover
Dallas knew or had any reason to know that the vehicle had any sort of mechanical
issues at the time of sale. At trial, Michael McGovern testified that he drove the
vehicle over 300 miles from Dallas to Odessa to personally deliver it to the Diaises
(2 RR 21). McGovern testified that the car “[d]rove great,” was “comfortable,”
and that he had “no issues” on the drive (3 RR 21–22). And Diais himself drove
the Range Rover approximately 800 miles—including a trip from Odessa to
Lubbock—before experiencing engine problems (2 RR 164–65).
Throughout his brief, Diais surmises that because Land Rover Dallas “would
have had all the information about the vehicle prior to selling the Vehicle through
inspections, reports, documentation, service history,” then Land Rover Dallas must
have somehow known at the time of sale that mechanical issues would manifest in
the near future and sold the vehicle as “new” despite this knowledge (Brief at p.
16). Diais’ mere suspicion is not evidence. A seller “has no duty to disclose facts
he does not know.” Prudential Ins. Co. of Am. v. Jefferson Assocs., Ltd., 896
S.W.2d 156, 162 (Tex. 1995).
14
Finally, Land Rover Dallas’s alleged statements that the Range Rover was
“the most luxurious, rugged vehicle, with a supercharged, high performance
engine” are simply not actionable statements. They are examples of “dealer’s
talk,” “puffing,” or opinion; they are not misrepresentations of material fact that
can constitute fraud. Prudential Ins. Co. of Am., 896 S.W.2d at 163 (holding that
statements that a building was “superb,” “superfine,” and “one of the finest little
properties in the City of Austin” were not actionable as mispresentations);
Autohaus, Inc. v. Aguilar, 794 S.W.2d 459, 463–64 (Tex. App.—Dallas 1991, pet.
denied) (holding that automobile salesman’s statements that car was best
engineered in the world, probably would not have mechanical difficulties and
probably would only need servicing for oil changes were puffing or opinion, and
not actionable statements).
Because these statements turn on vague and essentially undefinable terms,
and are expressions of opinion, they are too vague to be actionable. See Transport
Ins. Co. v. Faircloth, 898 S.W.2d 269, 276–77 (Tex. 1995); see Autohaus, 794
S.W.2d at 464 (“Generally, statements that compare one product to another and
claim superiority are not actionable misrepresentations.”). Indeed, Diais himself
testified during trial that he wanted a Range Rover because “[i]t’s a luxurious
vehicle,” and it is “rugged,” especially on curved roads (2 RR 120). Because Diais
15
has no evidence that Land Rover Dallas made material, false representations of
fact, the trial court properly refused his fraudulent inducement question.
B. The record contains no evidence of Land Rover Dallas’s alleged
fraudulent intent.
Even assuming arguendo that Land Rover Dallas made an actionable
misrepresentation, the trial court nonetheless properly refused a jury question on
fraud because Diais has shown no evidence that Land Rover Dallas intended to
deceive him. 7 Smith v. KNC Optical, Inc., 296 S.W.3d 807, 811–12 (Tex. App.—
Dallas 2009, no pet.); see Formosa Plastics Corp. USA v. Presidio Engineers and
Contractors, Inc., 960 S.W.2d 41, 46–47 (Tex. 1998). After selling the vehicle to
Diais, Land Rover Dallas had a salesman drive the vehicle 350 miles to personally
deliver it to Diais (2 RR 124–25). Later, when the vehicle’s engine developed
problems, Land Rover Dallas had it returned to the dealership via flat-bed truck, at
no expense to Diais, for repairs made under warranty (2 RR 133). Yet Diais
7
Diais argues without much elaboration that he can recover rescission damages without proving
that Land Rover Dallas’s alleged misrepresentations were material or its misrepresentations were
made with the intent to deceive (See Brief at p. 16). Diais’ claim for rescission, however, is
barred. Rescission is a common law contractual remedy. Yet when, as here, the contract in
dispute is for the sale of goods, the Uniform Commercial Code (UCC) controls. See Tex. Bus. &
Comm. Code § 2.102; see also SelecTouch Corp. v. Perfect Starch, Inc., 111 S.W.3d 830, 834
(Tex. App.—Dallas 2003, no pet.) (“Contracts relating to the sale of goods are governed by
article two of the Uniform Commercial Code (UCC), adopted in Texas as chapter two of the
business and commerce code.”); Aquila Sw. Pipeline, Inc. v. Harmony Exploration, Inc., 48
S.W.3d 225, 236 (Tex. App.—San Antonio 2001, pet. denied) (“Where the UCC applies,
common-law rules of law regarding breach of contract do not apply.”). Unlike the common law,
Article 2 of the UCC does not contain an equitable right to rescission. See Carrow v. Bayliner
Marine Corp., 781 S.W.2d 691, 695 (Tex. App.—Austin 1989, no writ.) (outlining the remedies
available to a buyer under the UCC).
16
contends that Land Rover Dallas knew all along that the vehicle would develop an
engine issue when they sold it. Diais has no evidence to support this far-fetched
theory.
Diais points out that knowledge of falsity can be proved with circumstantial
evidence,” but he never details for this Court any circumstantial evidence showing
that Land Rover Dallas allegedly knew the vehicle “was of deteriorated condition”
and chose to intentionally deceive the Diaises into buying it anyway. As set forth
above, Diais instead relies on conclusory allegations followed by a host of
unexplained string cites to the record. See Brief at p. 16–17. This Court should
decline Diais’ invitation to go hunting through the record to find the so-called
“evidence” he never clearly sets forth. Conclusory statements such as “the
misrepresentation was made with the intention that it should be acted on by the
other party” and “the representation was made to induce the purchaser,” without
more, are not evidence of fraudulent intent.
C. The record contains no evidence that Diais relied on any alleged
misrepresentation in connection with the sale of the Range Rover
If it were not already apparent that Diais’ fraud claim is not viable, his lack
of evidence on the element of reliance should make it clear that the trial court did
not err in refusing to submit the question to the jury. To prevail on a fraud claim,
plaintiff must show actual and justifiable reliance. See Grant Thornton LLP v.
Prospect High Income Fund, 314 S.W.3d 913, 923 (Tex. 2010). In determining
17
whether reliance is justifiable, the court considers whether, “given a fraud
plaintiff’s individual characteristics, abilities, and appreciation of facts and
circumstances at or before the time of the alleged fraud it is extremely unlikely that
there is actual reliance on the plaintiff’s part.” Id.
1. The “As-Is” Clause in the Contract Defeats the Element of
Reliance and Causation
As a matter of law, the “as-is” clause contained in the Agreement between
Diais and Land Rover Dallas negates the element of reliance and causation in
Diais’ misrepresentation claim. 8 See Prudential Ins. Co. of Am. v. Jefferson
Assocs., Ltd., 896 S.W.2d 156, 161 (Tex. 1995) (“[Plaintiff’s] ‘as is’ agreement
negates his claim that any action by [defendant] caused his injury.”); see also Gym-
N-I Playgrounds, Inc. v. Snider, 220 S.W.3d 905, 913 (Tex. 2007) (“[A]n ‘as is’
agreement precludes the lessee from proving that the lessor’s conduct caused
harm.”); Welwood v. Cypress Creek Estates, Inc., 205 S.W.3d 722, 726
(Tex.App.—Dallas 2006, no pet.) (“In general, a valid ‘as is’ agreement negates
the element of causation necessary to recover on claims regarding the physical
condition of the property.”); Larsen v. Carlene Langford & Assocs., Inc., 41
S.W.3d 245, 253 (Tex.App.—Waco 2001, pet. denied) (holding that “as is” clause
8
It should be noted that Land Rover Dallas did not manufacture or design the vehicle, as is
typically the case with any dealership. Instead of providing their own warranty, dealerships such
as Land Rover Dallas sell the vehicle “as is” along with the manufacturer’s warranty, as was the
case here. It should also be noted that Diais did not sue the manufacturer of his Range Rover.
18
in earnest money contract conclusively negated causation and reliance elements of
plaintiff's fraud, negligence and DTPA claims).
“The Texas Supreme Court has held that, generally, an ‘as is’ clause will
defeat the element of causation in DTPA, fraud, and negligence claims.” Bynum v.
Prudential Residential Services, Ltd. Partnership, 129 S.W.3d 781, 788 (Tex. App.
—Houston [1st Dist.] 2004, pet. denied), citing Prudential, 896 S.W.2d at 161. To
be sure, this holding has been reaffirmed by the Texas Supreme Court:
By agreeing to lease the property “as is,” a lessee agrees
to make his own appraisal of the bargain and accepts the
risk that he may misjudge its value. The lessor gives no
assurances, express or implied, concerning value or
condition of the premises. Thus, an “as is” agreement
precludes the lessee from proving that the lessor's
conduct caused harm.
Snider, 220 S.W.3d at 914.
The reasoning set forth in Prudential and Snider applies here. The sale of
the Range Rover was not a “take it or leave it” transaction. Diais was under no
compulsion or in any way forced to buy this luxury sport utility vehicle. He
clearly signed the contract, (1 CR 107), 9 and agreed to purchase the vehicle from
Land Rover Dallas “as is,” with any warranty on the vehicle coming from the
manufacturer. (Id.) As did the plaintiffs in Prudential and Snider, Diais agreed,
with respect to Land Rover Dallas, to “make his own appraisal of the bargain and
9
(4 RR __; P’s Ex. 1).
19
accept the risk that he may misjudge its value.” Snider, 220 S.W.3d at 914.
Ultimately, Diais’ agreement to purchase his Range Rover “as is” from Land
Rover Dallas negates his ability to prove reliance or causation as part of his
negligent misrepresentation or fraud claims.
2. Diais Admits That He Did Not Reply on Any
Representations In Connection With the Sale of the Vehicle.
Diais has admitted that before he and his wife travelled from Odessa to Land
Rover Dallas he had already decided to purchase a Range Rover (2 RR 119–22).
Diais also testified that he had no communication with Land Rover Dallas before
he traveled from Odessa to Dallas to purchase the Range Rover (Id.). He and Mrs.
Diais decided—strictly on their own accord—to fly to Dallas, purchase a white
Range Rover from the Land Rover Dallas, and drive it back home (2 RR 153–54).
The Diaises did not even test drive the Range Rover that they purchased:
14
3 Q. So – and correct me if I’m wrong, but along
4 about the time before y’all purchased this, your wife
5 said, “I’d like to get a new Range Rover”?
6 A. Correct.
7 Q. Okay. Any other decision – or any other
8 factors that factored into it other than this is what my
9 wife wants?
20
10 A. She thought it was the best vehicle on the
11 market and that’s what she wanted.
(4 Supp. CR ___ (emphasis added)).
18
20 Q. Was there any consideration by you or your wife
21 of any other kind of luxury SUV?
22 A. No. She was set on that.
19
3 Q. Was there a plan to go to any other Range Rover
4 dealerships?
5 A. There aren’t any that I know of.
6 Q. Well, I was going to ask you about the one in
7 Austin, but – are you familiar with the one in Austin
8 dealership?
9 A. No.
10 Q. No? So just so I can close the loop on that,
11 so there was no plan other than – there was no plan to
12 go to any other dealership in Texas that sold Land
13 Rovers other than the one in Dallas?
14 A. That is correct. We were set on buying one
21
15 from Dallas.
(Id. at 18–19).
Diais’ own testimony shows that neither he nor his wife justifiably relied on
any statement made by Land Rover Dallas. Nothing in the record supports Diais’
contention that he was somehow deceived or induced to purchase the vehicle.
Thus, Diais could not have prevailed on his fraudulent inducement claim even if he
were able to establish the other required elements.
D. The record contains no evidence that Diais was damaged as a result
of any alleged misrepresentations in connection with the sale.
Even assuming that Diais could meet his burden to show all other elements
of his fraudulent inducement claim—which he cannot—his claim would still fail
because he has suffered no damages. Diais’ vehicle was repaired, under warranty
and free of charge, in accordance with the terms of the parties’ Agreement and the
manufacturer’s warranty (1 CR 107).
Furthermore, Diais presented no evidence at trial that there was any
difference in the value of the vehicle as Land Rover Dallas represented it to Diais
and as the vehicle was sold to him (2 RR 232). And Diais has presented no
evidence to show that the mere fact that the vehicle required a warranty repair
reduced its value. At bottom, there is no difference in value between Diais’
vehicle, which required a warranty replacement of the engine, and a new vehicle
22
that did not. For these reasons, among the others outlined above, the trial judge
properly refused to submit to the jury Diais’ fraudulent inducement question.
III. The Trial Court Properly Excluded Diais’ Negligent Misrepresentation
Claim Because It Is Barred by the Economic Loss Rule and No
Evidence Supports Its Submission
A. The Economic Loss Rule Prevents Diais from Recovering in Tort for
What Is a Contract Claim
The economic loss rule “generally precludes recovery in tort for economic
losses resulting from a party’s failure to perform under a contract when the harm
consists only of the economic loss of a contractual expectancy.” Chapman Custom
Homes, Inc. v. Dallas Plumbing Co., 445 S.W.3d 716, 718 (Tex. 2014); see
LAN/STV v. Martin K. Eby Constr. Co., Inc., 435 S.W.3d 234, 238 (Tex. 2014);
Midcontinent Aircraft Corp. v. Curry County Spraying Serv., Inc., 572 S.W.2d 308
(Tex. 1978). “[A] party states a tort claim when the duty allegedly breached is
independent of the contractual undertaking and the harm suffered is not merely the
economic loss of a contractual benefit.” Gross v. WB Texas Resort Communities,
No. 02-12-00411, 2014 WL 7334950, at *7 (Tex. App.—Fort Worth Dec. 23,
2014, no pet.).
Here, Diais’ alleged injury is only the economic loss to the subject of the
contract itself—the purchase price of the Range Rover. Even assuming for
purposes of argument that Land Rover Dallas made promises or representations
concerning the vehicle that Diais relied on, those representations could serve only
23
as a breach of contract claim when the vehicle encountered an engine issue. See
Sw. Bell Telephone Co. v. DeLanney, 809 S.W.2d 493, 495 (Tex. 1991) (applying
the economic loss rule to bar actions for negligence); Murray v. Ford Motor Co.,
97 S.W.3d 888, 890–93 (Tex. App.—Dallas 2003, no pet.) (applying the economic
loss rule to prohibit recovery in tort for damage to a burned vehicle); Brewer v.
Gen. Motors Corp., 926 S.W.2d 774, 780 (Tex. App.—Texarkana 1996, no writ)
(“We agree that, under Texas law, Plaintiffs cannot recover purely economic losses
to their products based either on strict liability or negligence.”); see also Am. Eagle
Ins. Co. v. United Techs. Corp., 48 F.3d 142, 144 (5th Cir. 1995) (same). Thus,
this lawsuit sounds in contract alone, and the economic loss rule prevents Diais
from recovering for tort damages by way of a negligent misrepresentation claim.
See Jim Walter Homes, Inc. v. Reed, 711 S.W.2d 617, 618 (Tex. 1986). The trial
court therefore properly excluded Diais’ theory of negligent misrepresentation
from the jury charge.
B. No Legally Sufficient Evidence Supported the Claim
The economic loss rule aside, Diais’ negligent misrepresentation claim was
not viable because he has no evidence to support it. The elements Diais was
required to show to support a jury question on negligent misrepresentation are:
1. Land Rover Dallas made a representation in the course of its business,
or in a transaction in which he has a pecuniary interest;
24
2. Land Rover Dallas supplied “false information” for the guidance of
others in its business;
3. Land Rover Dallas did not exercise reasonable care or competence in
obtaining or communicating the information; and
4. Diais suffered pecuniary loss by justifiably relying on the
representation.
Fed. Land Bank Ass’n of Tyler v. Sloane, 825 S.W.2d 439, 442 (Tex. 1991)
(adopting Restatement (Second) of Torts § 552); see McCamish, Martin, Brown &
Loeffler v. F.E. Appling Interests, 991 S.W.2d 787, 791 (Tex. 1999).
1. Diais did not justifiably rely on any statements allegedly
made by Land Rover Dallas.
As discussed above in Section II.C.1 and II.C.2, Diais’ negligent
misrepresentation claim fails because, as a matter of law, he cannot establish the
reliance or causation elements of the claim. First, the “as-is” clause in the parties’
contract defeats the elements of reliance and causation under the Texas Supreme
Court’s decision in Prudential Insurance Co. of America v. Jefferson Assocs., Ltd.,
896 S.W.2d at 161, and its progeny. Second, the Diaises—by their own
admissions—did not rely on any alleged misrepresentation in connection with the
sale of the Range Rover (2 RR 119–22, 2 RR 153–54). Diais and his wife both
testified that they had decided that they wanted to purchase a new, white Range
Rover before they ever engaged in communications with Range Rover, saw any
25
advertisements for Land Rover Dallas, or stepped foot into the dealership (2 RR
153–54). Thus, for the same reasons Diais cannot establish the elements of
reliance or causation for his fraud claim, he likewise cannot establish the reliance
or causation elements of his negligent misrepresentation claim.
2. No evidence supports the element of damages in Diais’
negligent misrepresentation claim.
Just as Diais’ negligent fraudulent inducement claim fails because, among
other reasons, he has no proof that he suffered damages, so too does his negligent
misrepresentation claim (See Discussion at supra section II.D.). When Diais’
vehicle developed engine problems, Land Rover Dallas towed the vehicle back to
the dealership at its own expense and repaired his vehicle free of charge, under
warranty (2 RR 137). The only damages Diais suffered were caused by his own
refusal to pick up his vehicle for two years after repairs were complete.
IV. The Trial Court Properly Excluded Jury Questions Relating to the
Enforceability of the As-Is Clause
Diais argues that the trial court improperly excluded questions 18 through 21
of his proposed jury charge, which he argues were modeled to address the elements
required to invalidate an “as-is” clause as set forth in Prudential Insurance
Company of America v. Jefferson Associates, 896 S.W.2d 156, 162 (Tex. 1995).
This argument is untenable for several reasons.
26
First, Diais did not properly preserve this argument for appeal. Although the
proposed jury charge he submitted to the trial court contains proposed questions
18–20, it is not at all clear that these questions pertain to the invalidation of an “as-
is” clause:
Question No. 18.
Did SHIHAB DIAIS and ODESSA DENTAL
SOLUTIONS, P.A. enter into a service contract with
LAND ROVER DALLAS, L.P. within 90 days of
purchasing the vehicle from LAND ROVER DALLAS,
L.P.?
Answer Yes or No
Answer ___________
Question No. 19.
Did LAND ROVER DALLAS, L.P. obstruct
SHIHAB DIAIS and ODESSA DENTAL SOLUTIONS,
P.A.’s ability to inspect for defects of the vehicle?
Answer Yes or No
Answer __________
Question No. 20.
Were the first three sentences of the paragraph entitled
“Warranty Statement” of the Motor Vehicle Buyer’s
Order an incidental or boilerplate provision rather than an
important basis for the bargain?
Answer Yes or No
Answer: __________
27
Question No. 21.
Did SHIHAB DIAIS and ODESSA DENTAL
SOLUTIONS, P.A. have less bargaining power than
LAND ROVER DALLAS, L.P. regarding the paragraph
entitled “Warranty Statement” of the Sale Contract and
Finance Agreement?
Answer Yes or No
Answer: __________
At the formal jury charge conference, counsel for Diais did not mention these
proposed questions and did not argue to the trial judge that these questions should
be submitted as a basis for invalidating the “as is” clause in the Agreement (3 RR
10–12). See Wackenhut Corp. v. Gutierrez, 453 S.W.3d 917, 920 (Tex. 2015).
Because the issue is not preserved for review, as discussed in above, this Court
need not reach it.
In any event, whether the as-is clause in the Agreement was valid is a not a
question for the jury. In Prudential Ins. Co. of Am. v. Jefferson Assocs., Ltd., 896
S.W.2d 156, 162 (Tex. 1995), the Texas Supreme Court mandated that courts must
assess the validity of an “as is” agreement in light of three factors: (1) the
sophistication of the parties; (2) the terms of the “as is” agreement; (3) “whether
there was a knowing misrepresentation or concealment of a known fact.” Thus, it
was up to Judge Moyé to determine as a matter of law whether the as-is clause
negates the reliance element of Diais’ negligent misrepresentation claim. Id.
28
(concluding that a contract’s “as-is” clause negated the producing cause element of
plaintiff’s DTPA claim). His refusal to put the legal question of the clause’s
validity to the jury was not error. See. Pipe Line Co., Inc. v. Tichacek, 997
S.W.2d 166, 172 (Tex. 1999) (explaining that a jury question is immaterial and
should not be submitted to the jury if it calls for a finding beyond the province of
the jury, such as a question of law); Spencer v. Eagle Star Ins. Co. of Am., 876
S.W.2d 154, 156 (Tex. 1994) (same).
Even if it were preserved, however, the Court should reject Diais’ argument
because the refusal was harmless. See Tex. R. App. P. 61.1; Tex. Dept. of Transp.
v. Able, 35 S.W.3d 608, 617 (Tex. 2000) (“[A] successful challenge to evidentiary
rulings usually requires the complaining party to show that the judgment turns on
the particular evidence excluded or admitted”). At no time did Land Rover Dallas
argue the as-is clause to the jury as a basis for the jury finding that Land Rover
Dallas did not breach the Agreement. Although Diais argues after-the-fact, to this
Court, that “the Jury could have impermissibly relied upon the ‘AS IS’ language
contrary to the law,” Diais did not argue during trial that the “as is” clause is
unenforceable10 (See Brief at p. 30). Because Land Rover Dallas did not rely on
the “as is clause” before the jury, there was no harm in excluding the question.
10
Diais argues that the clause is unenforceable because he was fraudulently induced to sign the
Agreement. For the reasons explained in this brief under Section II, supra, Diais has no proof to
29
V. The Trial Court Properly Declined to Submit a Jury Question on
Unconscionable Conduct
The DTPA defines “unconscionable action or course of action” as “an act or
practice which, to a consumer’s detriment, takes advantage of the lack of
knowledge, ability, experience, or capacity of the consumer to a grossly unfair
degree.” Tex. Bus. & Comm. Code § 17.45(5). Construing the term “grossly,” the
Texas Supreme Court has explained that proving DTPA unconscionability
“requires a showing that the resulting unfairness was glaringly noticeable, flagrant,
complete and unmitigated.” Ins. Co. of N. Am. v. Morris, 981 S.W.2d 667, 677
(Tex. 1998); Chastain v. Koonce, 700 S.W.2d 579, 583–84 (Tex. 1985). Whether
this objective standard is met involves an examination of the entire transaction. Id.
Diais’ claim of unconscionable conduct is based upon alleged
misrepresentations that (1) the Vehicle was in new condition, 11 and (2) “the
Vehicle was the most luxurious, rugged vehicle, with a supercharged, high
performance engine” (Brief at p. 26). As previously discussed, these
representations were either true or not actionable. But even assuming they were
misrepresentations, they constitute no evidence that Land Rover Dallas took
advantage of his “lack of knowledge, ability, or capacity to a grossly unfair
support any of the elements of his fraudulent inducement claim. Thus, fraudulent inducement
does not constitute a basis for invalidating the as-is clause in the agreement.
11
As discussed in section II. A.1, the evidence is undisputed that the Range Rover sold to Diais
was a “new motor vehicle” as described by section 23.01.002(24) of the Texas Occupations
Code.
30
degree” and that this conduct was a producing cause of Diais’ damages. See
Chastain v. Koonce, 700 S.W.2d 579, 581 (Tex. 1985) (emphasis added).
By his own admission, Diais is an educated, sophisticated businessman (2
RR 149). He is a licensed dentist who owns a medical practice (1 RR 118, 149–
50). He also has an Executive Master Degree in Business Administration from
Texas Tech University (2 RR 149). Diais testified that he has purchased “lots of
new vehicles in the past,” including a Range Rover (2 RR 121, 149–151). Diais
also testified that he has experience in negotiating—“[t]here’s no question about
that” (2 RR 150).
In light of this testimony, it is clear that Diais has not put forth any evidence
that Land Rover Dallas took advantage of him at all during the negotiations for his
purchase of a Range Rover, let alone that Land Rover Dallas too advantage of him
“to a grossly unfair degree.” The “glaringly noticeable, flagrant, complete and
unmitigated” unfairness required to support a DTPA claim for unconscionable
action simply did not take place during Diais’ purchase of the Range Rover. The
trial court thus properly declined to submit Diais’ DTPA unconscionable conduct
claim.
31
Finally, Diais’ argument that Land Rover Dallas “failed to disclose material
facts about the Vehicle within their knowledge” is, again, misleading. 12 Although
Land Rover Dallas did not call the Diaises to tell them about everything they found
wrong with the car before making warranty repairs, such information was
disclosed in the repair order Diais was to receive when he picked up the vehicle
form the dealership, which he refused to do (2 CR 150–53).
VI. The Trial Court Properly Excluded the Carfax Report (Diais’ Exhibit
No. 13).
At trial, Wayne Cloud of Land Rover Dallas testified that the body damage
the Range Rover sustained while in the Diaises’ possession negatively affected its
value because it would eventually be reflected in the vehicle’s crash history report,
such as that generated by the website Carfax.com (2 RR 234). Diais attempted to
admit into evidence the actual Carfax report associated with the Range Rover Diais
purchase, apparently in an effort to show that no such information was on the
Carfax report by the time of trial. The proffered exhibit was a single-page printout
from the Internet with no supporting affidavit (2 RR 234–25). Upon objection, the
trial court excluded this evidence on grounds of hearsay and because the document
was not properly authenticated (Id.). Land Rover Dallas argued, and the trial court
12
Diais alleges that the “Service Manager testified how Defendants failed to disclose material
facts about the Vehicle” and then cites to the record without further explanation. But Diais’ own
self-serving testimony, which he includes in the string cite, is no evidence to support this
allegation.
32
agreed, that the document was not properly authenticated because Diais simply
printed it off of a website with no supporting proof that it was what Diais purported
it to be. See Tienda v. State, 358 S.W.3d 633, 644–46 (Tex. Crim. App. 2012)
(holding that a party must present sufficient circumstantial evidence to support a
finding that webpages are “what they [are] purported to be.”). 13 Diais did not
make an order of proof to admit the Carfax into evidence.14 This Court should
therefore not consider it. See Tex. R. Evid. 103(a)(2).
The trial court’s evidentiary ruling was proper and Diais’ appellate brief
does not address or attempt to refute the actual legal arguments on which the
evidence was excluded. Accordingly, Diais has waived any error by failing to
adequately brief this issue. See Tex. R. App. P. 38.1(i) (requiring that the
argument section of a brief include clear and concise argument with appropriate
citations to authorities).
Regardless, the ruling cannot constitute reversible error for several reasons
(See Brief at pp. 32–33). First, Diais’ argument that the manager of Land Rover
Dallas gave “extensive testimony” that was “patently false” and contrary to the
actual content of the Carfax reports is incorrect and misleading. The record shows
13
In Tienda, for example, the Texas Court of Criminal Appeals concluded that a proponent
properly authenticated a printout of a social media page by producing affidavits and an “official
MySpace Subscriber Report” evidencing that the appellant was actually responsible for the posts.
Tienda, 358 S.W.3d at 644–46.
14
Even though Diais did not make an offer of proof, the Court Reporter nevertheless included
the Carfax in the record.
33
otherwise. Wayne Cloud did not testify that the Carfax itself for this vehicle
contained negative information concerning past damage claims. Rather, he
testified that information regarding the vehicle’s history of body damage will, in
time, often make it into a Carfax report and become available to subsequent
purchasers of that vehicle. Cloud testified that the history of body damage would
greatly decrease the vehicle’s value upon resale:
Wayne Cloud: I mean, any damage, cosmetic or physical,
to the car. There are reports out on any site that you can
go to, the most popular one’s CARFAX and Auto Check.
Any anytime anything’s repaired in a body shop or any
type of cosmetic repair, it will show up on a CARFAX.
And I think that was even mentioned earlier when we
were in here. But those –
Q. Did you – Go ahead.
Wayne Cloud: Those reports, those companies get their
information from other companies, but it doesn’t have to
have – And really the bad part about it, is it doesn’t show
up instantly. It could take years, or 18 months, two
years, whatever it is, for that information to show up.
(2 RR 234) (emphasis added).
After Cloud gave this testimony, Diais’ counsel cross examined him at
length (2 RR 238–49). Counsel was free to cross examine Cloud about the Carfax
specifically and ask him what was or was not in the report for this particular
vehicle. Counsel chose not to do so, and should not be heard to complain now that
the jury was misled.
34
In any event, the evidentiary ruling cannot possibly be prejudicial because it
was cumulative of other evidence. Carfax report aside, Cloud’s extensive
testimony established that the damage done to the body of the car while it was in
the Diaises’ possession decreased its value significantly enough to prevent Diais
from being able to benefit from a collateral swap or trade-in for another new Range
Rover (2 RR 227–55). And the jury saw photographic evidence of the damage to
the Range Rover (5 RR __; D’s Ex. 17 (A–F))). The ruling was therefore not
harmful in light of the other evidence presented to the jury on the issue of the
vehicle’s body damage. See Sw. Elec. Power Co. v. Burlington N. R.R. Co., 966
S.W.2d 467, 474 (Tex. 1998) (holding that an evidentiary ruling was not harmful
because in light of other testimony and similar evidence, the excluded evidence
would have been cumulative); see also Tex. R. App. P. 44.1(a)(1). The harmless
evidentiary ruling is certainly no basis for reversal.
VII. Diais Was Not Entitled to a New Trial Based on His Alleged Discovery
of New Evidence
Diais argued unsuccessfully in the trial court, as he does here, that because
he purportedly has “newly discovered evidence,” he is entitled to a new trial (Brief
at 34–39). This argument lacks merit and, in any case, is waived.
35
A. Diais Did Not Properly Present His Newly-Discovered Evidence
Argument to the Trial Court; It Is Therefore Waived
Following the denial of his Motion for Judgment Notwithstanding the
Verdict, Diais filed a Motion for New Trial and a Supplement to the Motion for
New Trial (1 CR 97–106; 144–47). His motion was never set for a hearing and
was denied by operation of law.
Under Texas Rule of Appellate Procedure 33.1(b) and Texas Rule of Civil
Procedure 324, Diais waved his argument that he was entitled to a new trial based
on the discovery of new evidence because no evidentiary hearing was held in the
trial court. TRAP 33.1(b) provides as follows:
(b) Ruling by operation of law. In a civil case, the
overruling by operation of law of a motion for new trial
or a motion to modify the judgment preserves for
appellate review a complaint properly made in the
motion, unless taking evidence was necessary to properly
present the complaint in the trial court.
(emphasis added). Texas Rule of Civil Procedure 324 provides as follows:
PREREQUISITES OF APPEAL
(b) Motion for New Trial Required. A point in a
motion for new trial is a prerequisite to the following
complaints on appeal:
(1) A complaint on which evidence must be heard such
as . . . newly discovered evidence . . . .
Taken together, these two rules establish that when a movant argues as the basis
for a new trial the discovery of new evidence, the movant must ensure that the trial
36
court holds an evidentiary proceeding on the motion. Because the failure to do so
results in the movant’s failure to preserve the issue for appellate review, this Court
cannot reach Diais’ argument is that he is entitled to a new trial.
B. The Evidence Is Not New; It Is Based on Information Known to Diais
In Advance of Trial
Even if Diais’ argument was preserved and this Court considers it, it will not
carry the day. This so-called “new” evidence is, in reality, just newly created
expert affidavits Diais obtained after he lost at trial. Diais and his attorneys never
inspected the Range Rover in the entire two-year period prior to trial. The final,
take-nothing judgment in this case was signed on October 29, 2014 (1 CR 95).
That same day, Diais had an expert, Nathan Villarreal, “inspect the blemishes on
the vehicle.” Villarreal concluded that the blemishes on the body of the Range
Rover were not caused by the Diaises, but were caused by a defective paint job
(Brief at p. 35).
In December 2014, some two months after the trial, Diais took the vehicle to
Range Rover San Antonio (Brief at p. 37–38). According to the Affidavit of Paul
Sharp (attached to Diais’ supplement to his Motion for New Trial), Range Rover
San Antonio allegedly told Diais that the after-market wheels Land Rover Dallas
installed on the vehicle did not fit properly, causing damage to the vehicle that
would require $4,000 to repair (Brief at p. 38); (1 CR 144–46). Diais also states
that Range Rover San Antonio discovered that the engine was not properly
37
replaced by Land Rover Dallas, and that this repair would cost another $1,100
(Id.). All of this information, which Diais alleges was known to him only after
trial, purportedly entitles him to a new trial. This argument must be rejected.
Whether a motion or new trial on grounds of newly discovered evidence will
be granted is a matter generally left to the trial court’s sound discretion, and the
ruling will not be disturbed absent an abuse of discretion. Rivera v. Countrywide
Home Loans, Inc., 262 S.W.3d 834, 844 (Tex. App.—Dallas, no pet.). “On
review, every reasonable presumption will be made in favor of orders of the trial
judge refusing new trials.” Id. (citing Jackson v. Van Winkle, 660 S.W.2d 807,
809–10 (Tex. 1985)); see In re S.M.V., 287 S.W.3d 435, 451 (Tex. App.—Dallas
2009, no pet.).
To obtain a new trial based on this alleged newly discovered evidence, Diais
must show each of the following elements by affidavit:
1. He has admissible, relevant evidence introduced on the hearing for
new trial demonstrating the existence of newly discovered evidence
relied upon;
2. He had no knowledge of such evidence until after the conclusion of
the trial and that such evidence could not have been discovered prior
to the trial with the exercise of due diligence;
3. Such evidence was not cumulative or to be used for impeachment; and
4. Such evidence would probably produce a different result if a new trial
was granted.
Rivera, 262 S.W.3d at 844; see In re Thoma, 873 S.W.2d 477, 512 (Tex. 1994).
38
First, Diais cannot show that any of this evidence is actually new. Before
Diais purchased the vehicle, and long before trial, Diais knew the vehicle had
undergone an expensive body kit customization, that it had paint blemishes on it,
and that Land Rover Dallas would touch up the paint prior to delivery. The
salesman for Land Rover Dallas, Mike McGovern, explained this several times in
his deposition:
19
14 Q. Let's talk about the specific Range Rover that
15 the Diaises purchased. Were there modifications done to
16 that vehicle?
17 A. Yes.
18 Q. Who did those modifications?
19 A. Land Rover Dallas.
20 Q. What were those modifications?
21 A. We put different custom wheels on the car and
22 the body kit.
23 Q. And when you were talking with the Diaises, did
24 you discuss those modifications?
25 A. Yes.
* * *
39
25
23 Q. Do you know how much those modifications cost?
24 A. Total over the original list price for the
25 vehicle?
26
1 Q. Exactly.
2 A. Not exactly. I would estimate, rough estimate,
3 maybe $30,000, approximately. I'd have to look at the
4 original cost for labor and install. I know that body
5 kit, there was a lot of labor to put that body kit
6 together. The wheels were custom for that body kit so
7 that everything lined up correctly and looked good.
* * *
15
16 Q. Did you hear [sic] any issues about the car that was
17 sold to the Diaises?
18 A. Mechanically, no.
19 Q. What do you mean by “mechanically, no”?
20 A. When we were looking at the vehicle when the
21 Diaises decided on this particular vehicle, that they
40
22 wanted to purchase this one, because of the custom body
23 kit that was on the vehicle there were some paint
24 blemishes in the body kit itself. And so we discussed
25 that we didn't want the car to leave without those
16
1 blemishes being taken care of.
* * *
23 Q. Did you have any knowledge of any issues at all
24 regarding the vehicle?
25 A. Regarding the engine, no. Again, the blemishes
31
1 on the body kit were discussed with the customer, which is
2 why they did not take delivery that day.
(See 4 Supp. CR ___).
This testimony makes clear that Diais and his lawyers knew, long before
trial, that the vehicle had undergone a body customization, had paint blemishes,
and that prior to delivery would be repainted. This fact was never in dispute until
now, when Diais wants to argue that this information is new. As Diais himself
explained in his deposition:
13 Q. How long approximately were you and your wife
41
14 there at the dealership?
15 A. Approximately three hours.
16 Q. And you said there was -- the original plan was
17 to -- to drive it back?
18 A. That is correct.
19 Q. Okay. And did that happen?
20 A. No.
21 Q. Why not?
22 A. It needed some touchups, they told me.
23 Q. And do you know what they were going to do to
24 make it ready?
25 A. They said they needed some paint touchups and
29
1 other things. I don’t know what, but -- but they said
2 They will be happy to deliver it.
(4 Supp. CR __). Given this deposition testimony, neither Diais nor his lawyers
can now claim they have “newly discovered” evidence regarding the condition of
the paint on the vehicle. This information has been known to them for a long time.
The same is true with regard to Diais’ “newly discovered evidence” about
the size of the tires/wheels and Land Rover Dallas’s allegedly improper engine
42
repair. None of this information is “new” to Diais either. The same tires and
wheels that were on the vehicle when Diais purchased it were the same ones on the
vehicle when Diais abandoned the vehicle at the dealership after the engine was
replaced. They are the same tires and wheels that were on the vehicle while it
languished in the Land Rover Dallas parking lot, unclaimed or inspected by Diais,
for the two years leading up to trial. The work Land Rover Dallas had undertaken
to replace the engine did not change; the wheels and tires did not change. Any
issue Diais claims now concerning the work done to the engine could have
therefore been discovered and claimed years ago, before trial.
Interestingly, Diais did originally argue that Land Rover Dallas did not make
repairs to the Range Rover properly. (See 4 Supp. CR __). For some unknown
reason, however, Diais then chose not to inspect the engine replacement work prior
to, or even during, this lawsuit. Diais’ argument to the trial court in his Motion for
New Trial that the engine replacement was not done properly was therefore not
actually “new evidence.”
C. Diais Cannot Show That the Late Discovery of This Evidence Was Not
Due To His Lack of Diligence
The burden is on Diais to show, not only that the evidence is new, but that
he exercised the required diligence in procuring this evidence. See Waffle House,
Inc. v. Williams, 313 S.W.3d 796, 813 (Tex. 2010). “The due diligence
requirement has not been met if the same diligence used to obtain the evidence
43
after trial would have had the same result if exercised before trial.” Neyland v.
Raymond, 324 S.W.3d 646, 656 (Tex. App.—Fort Worth 2010, no pet.). Here, as
discussed above, Diais was indisputably aware of this so-called “newly
discovered” information in advance of trial and, through the exercise of due
diligence, Diais could have hired Nathan Villarreal or Paul Sharp to examine the
vehicle at any time before or during the lawsuit and trial. His failure to do so
negates the due diligence element of his burden, and his argument that he was
entitled to a new trial fails. See Rivera, 262 S.W.3d at 844–45 (affirming trial
court’s order refusing new trial because movants “knew the existence of evidence
material to their case,” but did not compel the attendance of necessary witnesses or
take their depositions, evidencing a lack of diligence precluding the grant of a new
trial); see Nixon v. GMAC Mortg. Corp., No. 05-08-00256-CV, 2009 WL 2973660,
at *3–4 (Tex. App.—Dallas Sept. 18, 2009, no pet.) (rejecting argument that newly
discovered evidence warranted new trial because, among other things, movant
“offered no evidence regarding why, using due diligence, he could not have
discovered [the evidence] prior to trial.”).
Diais knew long before trial that the vehicle had paint blemishes before
being sold, that the custom body kit included aftermarket tires/wheels that were
added before the vehicle was sold, that the body of the vehicle was found to be
damaged upon its return to the dealership, and that the engine had been replaced (4
44
Supp. CR __). Yet Diais showed no diligence in gathering any physical evidence
on these issues. Soon after the engine was replaced, when Land Rover Dallas
contacted Diais about repairing the vehicle’s body damage, he bluntly responded
“[t]his is no longer my vehicle” and that it now “belongs to your dealership” (2 RR
170–74). Diais’ refusal to even acknowledge ownership of the vehicle—except
when depreciating it on their federal income tax returns—continued throughout the
case (3 RR 9).
Diais’ refusal to inspect or even look at the vehicle for two years shows a
lack of diligence that is fatal to Diais’ argument that he is entitled to a new trial
based on “new” evidence that was there all along. See e.g., Jackson v. Van Winkle,
660 S.W.2d at 809 (court explained that failure to explain why lawyer did not
earlier obtain evidence, which was available and existed prior to trial, showed a
lack of diligence for purposes of motion for new trial); Patriacca v. Frost, 98
S.W.3d 303, 307 (Tex. App. – Houston [1st Dist.] 2003, no pet.) (holding that an
expert affidavit that could have been obtained during trial, but was not, did not
constitute newly discovered evidence); Herrera v. Seton Nw. Hosp., 212 S.W.3d
452, 462–63 (Tex. App.—Austin 2006, no pet.) (holding that the affidavit
45
regarding the manner of serving an expert report could have been presented earlier
and was therefore not “newly discovered” evidence for purposes of a new trial). 15
D. Diais’ “Newly Discovered” Evidence Is Not Material
A party seeking a new trial on grounds of newly discovered evidence must
demonstrate that “the evidence is so material it would probably produce a different
result if a new trial were granted.” Waffle House, 313 S.W.3d at 813. In other
words, Diais must show that the evidence would have made a difference. See id.;
Jackson v. Van Winkle, 660 S.W.2d 807, 809 (Tex. 1983), overruled on other
grounds by Mortiz v. Preiss, 121 S.W.3d 715 (Tex. 2003) (“In passing on a motion
for new trial on the ground of newly discovered evidence, the court will take into
consideration the weight and the importance of the new evidence and its bearing in
connection with the evidence received at trial.”).
Diais did not, and cannot, make this showing. The alleged newly discovered
evidence, including whether there was a defective paint job on the Range Rover,
are not directly related to the liability issues in this case, which concern whether
Land Rover Dallas honored its warranty or violated the DTPA. Land Rover
Dallas’s evidence concerning the body damage on the Diais’ vehicle was relevant
15
Diais attempts to cover his lack of diligence by arguing that Land Rover Dallas did not
produce documents that would have revealed this “new evidence.” (Brief at p. 39) This
argument, which is false, is a red herring. If Diais believed there were genuine discovery issues
he should have pursued them. This argument cannot at this point excuse his lack of diligence.
See, e.g., Alvarez v. Anesthesiology Assocs., 967 S.W.2d 871, 882-83 (Tex. App.—Corpus
Christi 1998, no pet.) (affirming the denial of a motion for new trial where party claiming
discovery issues showed a lack of diligence in pursuing the issues before trial).
46
to, among other things, impeachment, mitigation, damages, and to the question of
why Diais refused to pick up the vehicle after it was repaired. The evidence also
helped the jury understand what vehicle issues were under warranty and which
were not. But the jury was never asked to decide who caused the physical damage
to the body of the vehicle. Thus, the jury’s findings can stand without answering
that question, and Diais’ “newly discovered” evidence would not change those
findings. Waffle House, 313 S.W.3d at 813.
Diais’ “newly discovered” evidence is not material for another reason: there
was other physical damage to the vehicle besides chips in the paint. While the
vehicle was under the Diaises’ care, two of its wheels—the right rear and left
front—were severely damaged. The windshield was also broken (2 RR 141–44).
Thus, even assuming the evidence regarding the chips in the paint was as
pronounced at trial as Diais argues, and even assuming the chips in the paint were
caused by a defective paint job, Diais cannot show this was more important to the
jury than the evidence of physical wheel and glass damage. The same is true with
regard to the alleged tires/wheel size issue and alleged engine replacement work
issue. 16 At bottom, the “new” evidence regarding the paint issue is cumulative of
evidence regarding other vehicle damage. As such, it cannot support a new trial.
16
If Diais had any issues with regard to the tire/wheel size or Land Rover Dallas’s engine
replacement work, these should have been presented to Land Rover Dallas and an opportunity
afforded it to inspect and repair any problems, if necessary. Instead, Diais chose to ignore this
avenue, litigate the case for two years, and then proceed to trial.
47
See Waffle House, 313 S.W.3d at 813 (newly discovered evidence cannot be
cumulative for purposes of granting a new trial). The trial court thus properly
denied Diais’ motion for a new trial.
VIII. The Evidence Is Legally and Factually Sufficient to Support the Jury’s
Findings
The jury’s role is sacrosanct in determining the credibility of the trial
witnesses, and a jury’s decision concerning disputed questions of fact must not be
disturbed; intermediate courts of appeals must refrain from merely substituting
their own judgment for that of the jury, even if they do not agree with a jury’s
verdict. City of Keller v. Wilson, 168 S.W.3d 802, 809–10 (Tex. 2005); Golden
Eagle Archery, Inc.v. Jackson, 116 S.W.3d 757, 762 (Tex. 2003); Pool v. Ford
Motor Co., 715 S.W.2d 629, 633–34 (Tex. 1986).
A. Standard of Review
1. Legal Sufficiency
“When a party attacks the legal sufficiency of an adverse finding on an issue
on which she has the burden of proof, she must demonstrate on appeal that the
evidence establishes, as a matter of law, all vital facts in support of the issue.”
Dow Chem. Co. v. Francis, 46 S.W.3d 237, 241 (Tex. 2001). In reviewing a
“‘matter of law’ challenge,” the court must first review the trial court record for
evidence that supports a negative finding on a question of liability, disregarding
evidence to the contrary unless a reasonable jury could not. Id.; see City of Keller
48
v. Wilson, 168 S.W.3d 802, 827 (Tex. 2005); Sterner v. Marathon Oil Co., 767
S.W.2d 686, 690 (Tex. 1989). The court considers the evidence in the light most
favorable to the jury’s finding under review and indulges every reasonable
inference that would support it. Id. at 822. If there is any evidence to support the
negative finding, the legal sufficiency challenge fails. See Holley v. Watts, 629
S.W.2d 694, 696 (Tex. 1982). The issue will be sustained only where the contrary
position is established as a matter of law.
Moreover, evidence need not support a jury’s failure to find a particular fact
because the jury acts as the ultimate decision maker on the credibility of plaintiff’s
case and is entitled to disbelieve evidence presented by the party who bears the
burden of proof. See McGalliard v. Kuhlman, 722 S.W.2d 694, 697 (Tex.1986).
The jury may believe one witness and not another, and is free to resolve
inconsistencies in trial testimony. Id.
2. Factual Sufficiency
When a party with the burden of proof attacks the factual sufficiency of an
adverse jury finding, it must demonstrate that the finding was “so against the great
weight and preponderance of the evidence as to be clearly wrong and manifestly
unjust.” Dow Chem., 46 S.W.3d at 242; Ortiz v. Jones, 917 S.W.2d 770, 772 (Tex.
1996). The reviewing court considers and weighs all the evidence to determine if
the party has met this standard. Rowlett/2000, Ltd. v. City of Rowlett, 231 S.W.3d
49
587, 590 (Tex. App.—Dallas 2007, no pet.). But the appellate court cannot act as
fact finder. Id. That is, even if the evidence the parties presented at trial could
have supported a different result, the court of appeals is not entitled to substitute its
judgment for that of the jury’s or to pass upon a witness’s credibility. Maritime
Overseas Corp. v. Ellis, 971 S.W.2d 402,407 (Tex. 1998). If the reviewing court
reverses a jury finding on the basis of factual sufficiency, it must detail the
evidence relevant to the issue and state with clarity how the contrary evidence
greatly outweighs the evidence that supports the verdict. See Ellis Coutny State
Bank v.Keever, 888 S.W.2d 790, 794 (Tex. 1994). “The amount of evidence
necessary to affirm a judgment is far less than necessary to reverse a judgment.”
Rowlett/2000, 231 S.W.3d at 590.
B. The Evidence Is Legally and Factually Sufficient to Support the Jury’s
Finding of No Liability on Diais’ Breach of Contract Claim
With regard to Diais’ breach of contract claim, the jury was charged as
follows:
Do you find from a preponderance of the evidence that
LAND ROVER DALLAS, L.P. failed to comply with its
agreement with SHIHAB DIAIS and ODESSA
DENTAL SOLUTIONS, P.A.?
The jury answered “NO” (1 RR 85).
Diais’ breach of contract claim is based the Retail Purchase Agreement (the
Agreement) in which Land Rover Dallas promises to sell and deliver Diais a new
50
vehicle, and that, in return, Diais will pay for it (1 CR 107–08). The Agreement
provides that Land Rover Dallas would sell and deliver to Diais a 2012 Range
Rover Sport, “as is,” and with a manufacturer’s warranty (Id.).
The evidence shows conclusively that Land Rover Dallas performed its part
of the bargain. In conformance with the Agreement, Land Rover Dallas personally
delivered the new 2012 Range Rover to Diais in Odessa (2 RR 124–25, 160–61).
And although Land Rover Dallas did not itself provide a warranty on the vehicle, it
honored the manufacturer’s warranty when the Range Rover experienced engine
trouble by towing the vehicle back into the dealership and promptly replacing the
engine under warranty at no cost to the Diaises (2 RR 133, 137). The repaired
Range Rover, which Diais continues to make payments on, sat for two years before
this lawsuit was filed, ready to be picked up by its owner (2 RR 176). This is
evidence that Land Rover Dallas did not breach the Agreement with Diais and for
that reason alone, Diais’ challenge to the sufficiency of the jury’s verdict should be
rejected. See Tex. Bus. & Com. Code § 2.106 (“Goods or conduct including any
part of a performance are ‘conforming’ or conform to the contract when they are in
accordance with the obligations of the contract.”).
Even if the jury did not find the foregoing evidence conclusive, however,
Diais still cannot show that the evidence is legally or factually insufficient to
support the jury’s verdict. There is no evidence in the record to support Diais’
51
contention that he relied on alleged representations by Land Rover Dallas prior to
the signing of the Agreement. As discussed earlier in this brief, Diais’ own
testimony, and his wife’s, proves that the Diaises made up their minds to buy a
Range Rover before ever stepping foot into Land Rover Dallas or ever hearing a
representation from anyone at Land Rover Dallas (2 RR 121–22). Furthermore,
even assuming there was a breach at all (which there was not), the Diaises
presented no evidence that they actually harmed. Indeed, the evidence shows
conclusively that when the vehicle’s engine failed, Land Rover Dallas promptly
towed the vehicle back to the dealership, honored the manufacturer’s warranty by
replacing the vehicle’s engine at no cost to Diais, and made it available for him to
pick up. Any harm caused to Diais is a result of his own refusal to pick up his
repaired vehicle.
Reviewing this evidence, it is clear that Diais does not meet his burden to
show that either: (1) no evidence presented at trial supports the jury’s finding that
Land Rover Dallas did not breach the Agreement and the contrary was established
as a matter of law, or (2) that the jury’s finding that Land Rover Dallas did not
breach the Agreement is so contrary to the evidence presented at trial that it is
clearly wrong and unjust. See Dow Chem. Co., 46 S.W.3d at 241. Hence, the
jury’s finding of no breach of contract cannot be disturbed.
52
C. The Evidence Is Legally and Factually Sufficient to Support the Jury’s
Finding of No Liability on Diais’ DTPA Claim
With regard to Diais’ DTPA claim, the jury was charged as follows:
Do you find from a preponderance of the evidence
that Land Rover Dallas, L.P. engaged in any false,
misleading or deceptive act or practice that SHIHAB
DIAIS or ODESSA DENTAL SOLUTIONS, P.A. relied
on to their detriment and that was a producing cause of
damages to SHIHAB DIAIS or ODESSA DENTAL
SOLUTIONS, P.A.?
The jury answered “NO” (1 RR 83).
To recover under the DTPA, Diais must show that he relied on statements
made by Land Rover Dallas in connection with the sale of the vehicle. As pointed
out earlier, however, Diais’ own testimony establishes that before he ever even
spoke to anyone at Land Rover Dallas he had already made up his mind to
purchase a Range Rover (2 RR 199–22). Thus, the jury was free to find that Diais
did not rely on anything represented by Land Rover Dallas in connection with the
sale. . Diais’ argument in this Court that the evidence conclusively establishes that
he relied on Land Rover Dallas’s alleged statements strains credibility. It must be
rejected.
Under Texas Law, the jury is free to disregard even undisputed evidence if it
comes from a witness the jury does not find credible. The Texas Supreme Court
has explained:
53
[j]urors are the sole judges of the credibility of the
witnesses and the weight to give their testimony. They
may choose to believe one witness and disbelieve another
. . . . Jurors may disregard even uncontradicted and
impeached testimony from disinterested witnesses.
Wilson, 168 S.W.3d at 819–20; see Cason v. Taylor, 51 S.W.3d 397, 408 (Tex.
App.—Waco 2001, no pet.) (“[T]he fact finder has a right to believe or disbelieve
any portion of the testimony.”); Lance v. USAA Ins. Co., 934 S.W.2d 427, 429
(Tex. App.—Waco 1996, no writ) (“The jury is free to believe or disbelieve any
witness, regardless of whether the witness’s testimony is later controverted.”).
Courts reviewing the evidence under a legal sufficiency review must assume
that jurors resolved conflicts in accordance with the verdict. Wilson, 168 S.W.3d
at 820. Thus, to the extent that the evidence presented at trial in this case turned on
the credibility of the witnesses, that was for the jury to decide. The jury was free
to believe that Land Rover Dallas committed no conduct that violated the DTPA
and that Diais was not deceived and/or did not rely on any representations in
connection with the sale of the vehicle. This Court “may not pass upon a witness’s
credibility or substitute [its] judgment for that of the jury, even if the evidence
might clearly support a different result.” O’Connor v. Miller, 127 S.W.3d 249, 254
(Tex. App.—Waco 2003, pet. denied) (internal citations omitted).
Finally, the evidence in the record does not conclusively prove causation.
The jury heard testimonial evidence from several witnesses that the vehicle’s
54
engine failed, that Land Rover Dallas towed it into the repair shop and repaired it,
and that it sat in the repair shop for two years before trial, untouched by Diais. The
jury was free to decide that Land Rover Dallas’s conduct was not a cause of any
damages to Diais. In any event, the great weight and preponderance of the
evidence is not against the jury’s finding on Diais’ DTPA claim such that its
finding of no liability is manifestly unjust. For these reasons, the trial court’s
judgment on the jury’s take-nothing judgment must be affirmed.
PRAYER
Land Rover Dallas requests that this Court affirm the trial court’s judgment
in all respects. Land Rover Dallas also prays for any other and further relief, at
law or in equity, to which it is justly entitled, including an award of its appeal
costs.
55
Respectfully submitted,
THOMPSON, COE, COUSINS & IRONS,
L.L.P.
By: /s/ Sara Berkeley Churchin
Wade C. Crosnoe
State Bar No. 00783903
E-mail: wcrosnoe@thompsoncoe.com
John W. Chambless, II
State Bar No. 00796334
E-mail: jchambless@thompsoncoe.com
Sara Berkeley Churchin
State Bar No. 24073913
E-mail: schurchin@thompsoncoe.com
701 Brazos, Suite 1500
Austin, TX 78701
Telephone: (512) 703-5035
Facsimile: (512) 708-8777
Counsel for Appellees Land Rover Dallas, L.P.
and Snell Motor Company Operations GP,
LLC, General Partner
CERTIFICATE OF COMPLIANCE
This brief complies with the word limit of Tex. R. App. P. 9.4(i)(2)(B) be-
cause it contains 13,223 words, excluding the parts of the brief exempted by Tex.
R. App. P. 9.4(i)(1).
/s/ Sara Berkeley Churchin
Sara Berkeley Churchin
56
CERTIFICATE OF SERVICE
I certify that a true and correct copy of this Appellees’ Brief was served on
June 26, 2015, via electronic service or email to the following counsel:
Jeffrey F. Thomason
Shane M. Bebout
Todd, Barron, Thomason, Hudman & Baxter P.C.
3800 E. 42nd Street, Suite 409
Odessa, Texas 79762-5982
Email: Thomason@toddlawfirm.com
Email: SBebout@toddlawfirm.com
Counsel for Appellants
/s/ Sara Berkeley Churchin
Sara Berkeley Churchin
57
Appendix A
• 1515 W . 5 Street
l h
Q 11400 N, Control Expressway • 6935 Preston Road
Ausllrt, TX 78703 P.O. BOX 7406B7 Frisco, T X 75034
512-236-0000 Dallas, TX 75374-0667 972-370-2345
Austin " Delias • Frisco landroverausllnxDin 214-691-4294 londroverirlscoxom
iaiidroverdailas.corn
Delivery rtal : 0 9 / 1 9 / 2 0 1 2
OUST MO. 34646
fl
Motor Vehicle Buyer's Order Deal Number: IMS
ODESSA DENTAL SOLUTION
Purchaser's Namefs): SBIHAB DIA1H Date: 0 9 / 1 9 / 2 0 1 2
Address: 2470 H 11TH S T ODESSA TX 75761 County: ECTOR
HornsTelephone: , ( 4 3 ? , U 4 9 - 5 9 4 9 „ _Work Telephone: i l 3 2 ± 3 3 3 - 4 a m -
E-ryiall- S D I A I S g A O L . C O M
YEAR MAKE MODEL COLOR STOCK NO.
2012 I A N D ROVER R A N G E RVK SPOBT FOOT W H I T E . D12375
SERIAL NO: ODOMETER READING SALESPERSON:
SALSH2E44CA748113 D NOT ACCURATE 22 MICHAEL- P MCGOV3RN
THE VEHICLE IS: PRIOR USE DISCLOSURE:
SNEW DUSEO ODBAOfiSTRATOH O FACTORY EXECUTIVE/OFFICIAL D RENTAL • CERTIFIED
WARRANTY STATEMEtiT : f
. i"" ?? -: £ :
1
' '•" Hsnp . 77645.00
W e a m selling this VehicFe to y o u AS-tS a n d wa- e x p r e s s l y disclaim all CASH PRICE OF VEHICLE 100854.00
warranties, e x p r e s s o r implied, Including a n y Implied warrarrtlas o f OPTIONAL ACCESSORIES:
merchantability and f i t n e s s for a particular pu rposo u n l e s s the box besldo
" U S E D V E H I C L E LIMITED W A R R A N T Y APPLIES>" i s marked below or w e enter
into a service contract wrtn you at tnetinne ot, or within s u d a y s or, t n e a a t e o t
this transaction. AH warranties, If any, by a manufacturer or supplier other than
o u r Dealership are tfrielrs, n s i o u r s , and only s u c h manufacturer or supplier
Bhall b e liable for performance, under a u c h warranties. W e holthpr a s s u m e nor
authorize any other person to a s s u m e for u s any liability In connection with'the
s a t e of the V e h i c l e a n d related o o o d s a n d s e r v i c e s . C O N T R A C T U A L
D I S C L O S U R E S T A T E M E N T . ( U S E D V E H I C L E S ONLY) T h e Information you see
o n the window form for this Vehicle Is part of this c o n t r a c L Information on the
window form overrides a n y contrary provisions i n the contract of sale.
• USED VEHICLE LIMITED WARRANTY APPLIES, We are providing Iha attached Used
Vehicle Limited Warranty In connection with this transaction. Any Implied warranties apply TOTAL SELLING PRICE 100854,00
for the duration of the Limited Warranty.
LESS: TRADE-IN ALLOWANCE
ut ^
T R A D E - I N V E H I C L E : ttiFpntMifibftv •• ;• ,;. •
Yean Mate: Modal: Ltetf:
SUBTOTAL 100854.00
Serial No.: Odomoler Rending:
Q Not Accurate
SALES TAX 6303.3B
Trado-ln Allowance; Balanw 0*-pct a. Unnbcldor;
N/A DEALER'S INVENTORY TAX 227. S3
Dealer's Inventory T a x : T h e Dealer's inventory Tax c h a r g e I s Intended to
reimburse t h e Dealer for a d valorem taxes on Its motor v e h i c l e Inventory.
Trie charge, w h i c h Is paid by the Dealer to the county tax a s s e s s o r - DOCUMENTARY FEE* . 85.00
collector, is not a tax i m p o s e d o n a c o n s u m e r by the government, and I s
STATE INSPECTION FEE 2 3 .-7S
not required to be c h a r g e d by i h e Dealer to t h e c o n s u m e r .
*A Documentary Fee Is not an official fee. A documentary too la not required by low, DEPUTY SERVICE FEE H/A
but may be charged to buyers for handling documents relating to the sale. A LICENSE FEE
71.00.
documentary fee may not exceed a reasonable amount agreed t o by the parties.This
notice I s required by law. TITLE FEE 33.00
Namo:
J E K O R G A N CHASE BSMK HA EXT. SERVICE AGREEMENT ST/A
A