Mohammed T. Jamshed v. McLane Express, INC. D/B/A the C. D. Hartnett Company , 449 S.W.3d 871 ( 2014 )

COURT OF APPEALS
EIGHTH DISTRICT OF TEXAS
EL PASO, TEXAS
MOHAMMED T. JAMSHED, §
No. 08-13-00101-CV
Appellant, §
Appeal from the
v. §
43rd District Court
McLANE EXPRESS INC., D/B/A THE §
C.D. HARTNETT COMPANY, of Parker County, Texas
§
Appellee. (TC# CV08-1669)
§
OP I N I O N
This is an appeal from a final judgment in favor of Appellee McLane Express, Inc. D/B/A
The C.D. Hartnett Company (“Hartnett”) against Appellant Mohammed T. Jamshed on his
personal guaranty of an open account for his business, Shawn & Sameer, Inc. (“S&S”).
Appellant raises four issues for review. For the reasons that follow, we affirm.1
BACKGROUND
In 2004, Appellant signed a credit application with Hartnett, a wholesale food distributor,
on behalf of S&S. As part of the application, Appellant attached a document listing the different
store locations owned and operated by S&S. Under the section listing Appellee’s conditions for
extension of credit, Appellant signed the application and identified himself as the president of the
1
As this case was transferred from our sister court in Fort Worth, we decide it in accordance with the
precedent of that court. TEX. R. APP. P. 41.3.
company. Below that section is a section titled “Individual Personal Guaranty” which Appellant
also signed. In pertinent part, the section provides:
INDIVIDUAL PERSONAL GUARANTY
Date ___8-12-04 19 _________
Mohammed T Jamshed (Tony)___, residing at 8149 Hulen Park Cir. Ft.
Name [Please Print]
Worth Tx. 76123 for and in consideration of you extending credit at my
request to __Shawn & Sameer Inc.________________________________
Name of Customer
(Hereinafter referred to as the “Company”) of which I am (Title):
President__________________, hereby personally guarantee to The C.D.
Hartnett Company, payment of any obligation of the Company and I
hereby agree to bind myself to pay you on demand, any sum which may
become due to you by the Company whenever the Company shall fail to
pay the same. It is understood that this guaranty shall be continuing and
irrevocable guaranty and indemnity for such indebtedness of the
Company. I hereby waive notice of default, non-payment, and notice
thereof and consent to any modification or renewal of the credit agreement
hereby guaranteed and to all renewals of extension of credit. The
undersigned guarantor agrees to pay in the event the amount becomes
delinquent and is turned over to an attorney for collection, reasonable
attorney’s fees, plus all attendant collection costs.
At trial, Stephen Milliken, Hartnett’s president, explained that Hartnett would not extend
credit terms to a prospective customer until the credit application was completed and signed by
the customer. It was Hartnett’s general policy to require a personal guaranty from the owner of
its corporate entity customers. The personal guaranty executed by Appellant was required
before Hartnett would extend credit to S&S. Milliken personally approved the credit
application signed by Appellant for S&S.
As a result of S&S’s credit application, Hartnett sold and delivered product and
merchandise to S&S on credit terms. Hartnett assigned each S&S store receiving product an
individual account number which was tied to S&S’s master account. When S&S became
delinquent on its open account, Hartnett sent Appellant a demand letter reminding Appellant of his
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personal guaranty and demanding immediate payment. S&S failed to make payment to Hartnett.
Milliken testified that S&S filed bankruptcy and at that time it owed Hartnett $91,817.67.
Hartnett sued Appellant on the personal guaranty seeking to recover the unpaid balance of
S&S’s open account and attorney’s fees. Alternatively, Hartnett alleged Appellant was liable
under the doctrine of quantum meruit. Appellant responded to the suit with a general denial and
asserted various affirmative defenses. After a bench trial, the trial court entered judgment in
favor of Hartnett, ordered Harnett recover $91,817.67 from Appellant, and awarded $59,235 in
attorney’s fees to Hartnett. Appellant then moved for a new trial. This appeal followed.
DISCUSSION
In four issues on appeal, Appellant contends (1) the alleged personal guaranty he signed
was not enforceable; (2) Appellant’s liability is limited to the debts incurred by S&S for stores
located in Territory 62; (3) Hartnett failed to establish each element of its cause of action with
competent evidence; and (4) the trial court erred in granting Hartnett attorney’s fees. In essence,
Appellant is challenging the legal and factual sufficiency of the evidence and both parties cite to
the proper standards of review.
Standard of Review
In a bench trial, without findings of fact or conclusions of law, the trial court’s judgment
implies all findings of fact necessary to support it. Holt Atherton Indus., Inc. v. Heine, 835
S.W.2d 80, 83-84 (Tex. 1992); In re M.C.T., 250 S.W.3d 161, 172 (Tex.App. – Fort Worth 2008,
no pet.); Alford v. Johnston, 224 S.W.3d 291, 296 (Tex.App. – El Paso 2005, pet. denied). When
a reporter’s record is provided, as in this case, these implied findings are not conclusive, and may
be challenged by legal and factual sufficiency of the evidence issues. M.C.T., 250 S.W.3d at 172;
Alford, 224 S.W.3d at 296.
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In conducting a legal sufficiency review, we consider evidence in the light most favorable
to the trial court’s findings and indulge every reasonable inference that would support them.
City of Keller v. Wilson, 168 S.W.3d 802, 822 (Tex. 2005). We credit favorable evidence if a
reasonable fact finder could and disregard contrary evidence unless a reasonable fact finder
could not. Id. at 827. However, in a factual sufficiency review, we consider and weigh all of
the evidence and will “set aside the verdict only if it is so contrary to the overwhelming weight
of the evidence as to be clearly wrong and unjust.” Cain v. Bain, 709 S.W.2d 175, 176 (Tex.
1986). In conducting our reviews, we are mindful that the trier of fact is the sole judge of the
credibility of the witnesses and the weight to give their testimony, and that it is within his
exclusive province to resolve any conflicts in the evidence. City of Keller, 168 S.W.3d at 819;
Precision Homes, Inc. v. Cooper, 671 S.W.2d 924, 929 (Tex.App. – Houston [14th Dist.] 1984,
writ ref’d n.r.e.).
Law Applicable to Guaranty Agreements
A guaranty creates a secondary obligation under which the guarantor promises to answer
for the debt of another and may be called upon to perform once the primary obligor fails to
perform. Anderton v. Cawley, 378 S.W.3d 38, 46 (Tex.App. – Dallas 2012, no pet.) (quoting
Dann v. Team Bank, 788 S.W.2d 182, 183 (Tex.App. – Dallas 1990, no writ)). A plaintiff
asserting a guaranty claim must establish: (1) the existence and ownership of the guaranty, (2)
the terms of the underlying contract by the holder, (3) the occurrence of the conditions upon
which liability is based, and (4) the failure or refusal to perform the promise by the guarantor.
See Gold’s Gym Franchising LLC v. Brewer, 400 S.W.3d 156, 160 (Tex.App. – Dallas 2013, no
pet.); Wiman v. Tomaszewicz, 877 S.W.2d 1, 8 (Tex.App. – Dallas 1994, no writ); Shin v. Sharif,
No. 02-08-00347-CV, 2009 WL 1565028, at *2 (Tex.App. – Fort Worth June 4, 2009, no pet.)
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(mem. op., not designated for publication); see also Simpson v. MBank Dallas, N.A., 724 S.W.2d
102, 107 (Tex.App. – Dallas 1987, writ ref’d n.r.e.) (stating that when a guaranty is written and
signed by guarantor, its existence presumes consideration).
The rule governing interpretation of a guaranty agreement makes a guarantor a favorite of
the law. Moffitt v. DSC Finance Corp., 797 S.W.2d 661, 666 (Tex.App. – Dallas 1990), writ
denied, improvidently granted, 815 S.W.2d 551 (Tex. 1991). A guarantor agreement is to be
strictly construed and may not be extended beyond its precise terms by construction or
implication. Robinson v. Surety Ins. Co. of Cal., 688 S.W.2d 705, 708 (Tex.App. – Fort Worth
1985, no writ). The interpretation of the guaranty is a question of law we review de novo. See
Gulf Ins. Co. v. Burns Motors, Inc., 22 S.W.3d 417, 423 (Tex. 2000).
ENFORCEABILITY OF THE PERSONAL GUARANTY
In Issue One, Appellant asserts that the personal guaranty he signed was unenforceable
because (1) Hartnett failed to prove Plaintiff McLane Express, Inc. owned the personal guaranty;
(2) no consideration supported the personal guaranty; and (3) Hartnett failed to show that it used
reasonable diligence to collect from S&S, the primary obligor.
Ownership of the Guaranty
In his first sub-issue, Appellant contends Hartnett failed to present any evidence
establishing ownership of the personal guaranty. Appellant asserts that “[c]orporations are
distinct entities, and pleadings establish that [Hartnett] was acquired by [McLane Express] and
then that branch of the business is being run under an assumed name. Because of the acquisition
of [Hartnett], [McLane Express] had to prove that it, and not Hartnett, was entitled to enforce the
guaranty.” He further argues Hartnett failed to introduce any evidence showing the guaranty was
assigned to McLane Express, that McLane Express was the same entity as Hartnett despite the
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merger or acquisition of Hartnett, or that McLane Express owned the guaranty. However, as
correctly noted by Hartnett, Appellant’s sub-issue concerning the assignment is barred on appeal
because he did not properly raise it below. Hartnett further maintains Appellant’s ownership
argument is without merit because the record contains sufficient evidence to support the judgment
of the trial court.
Rule 93 of the Texas Rules of Civil Procedure requires that certain pleas be sworn or
verified by affidavit unless it is obvious in context that “the truth of such matters appear of
record[.]” TEX.R.CIV.P. 93; see e.g., TEX.R.CIV.P. 93(1) (allegations that plaintiff lacks legal
capacity to sue or that defendant does not have legal capacity to be sued); 93(2) (allegations that
plaintiff is not entitled to recover in capacity in which he sued or that defendant is not liable in
capacity in which he is sued); 93(4) (allegations that there is a defect of parties); 93(8) (denial of
the genuineness of the indorsement or assignment of a written instrument upon which suit is
brought); 93(14) (allegations that a party is not doing business under an assumed name). Here,
the record shows Appellant filed a general denial and raised an affirmative defense denying that
all conditions precedent to Hartnett’s claim for recovery had occurred or been met. However,
there is nothing in the record to suggest Appellant was challenging the issue of ownership of the
guaranty or anything related to any assignment of the personal guaranty.
Appellant did not file a verified denial denying the genuineness of the assignment of a
written instrument upon which suit was brought and he did not allege a defect in the parties or that
McLane Express was not doing business under the assumed name of Hartnett. TEX.R.CIV.P.
93(8),(4),(14). Failure to file verified pleas as required by Rule 93 waives a party’s right to
complain about the issue. See White v. Harrison, 390 S.W.3d 666, 678 (Tex.App. – Dallas 2012,
no pet.) (where appellant claimed not to be liable as guarantor appellate court concluded there was
6
no issue for appellate court to review because appellant failed to file verified plea); James Clark,
Inc. v. Vitro America Inc., 269 S.W.3d 681, 682 (Tex.App. – Beaumont 2008, no pet.) (where
appellee alleged that it was also known by two other names and appellants failed to file a verified
denial regarding a defect in parties or a plea that plaintiff was not doing business as alleged
appellate court concluded appellants’ allegation was not at issue); see also Thomas v. Sun Indus.,
Inc., No. 05-92-02559-CV, 1994 WL 21898, at *2 (Tex.App. – Dallas Jan. 27, 1994, writ denied)
(op., not designated for publication) (appellant waived defense that appellant was not doing
business under assumed name because defendant failed to file verified denial). Because
Appellant failed to file a verified denial challenging any assignment of the guaranty, alleging a
defect of parties, and did not respond to Hartnett’s assertion that it was suing as McLane
Express, Inc., d/b/a The Hartnett Company, Inc., Appellant’s complaint is not before us on
appeal. See id.
Even assuming this sub-issue was not waived, Appellant’s argument would fail.
Appellant argues there is no evidence of ownership of the guaranty. In considering Appellant’s
no-evidence point, we consider only the evidence supporting the finding and disregard all
evidence and inferences to the contrary. See Weirich v. Weirich, 833 S.W.2d 942, 945 (Tex.
1992). To prevail on a guaranty claim, Hartnett had to show the existence and ownership of the
guaranty. Gold’s Gym Franchising LLC, 400 S.W.3d at 160. Consequently, Appellant must
show there was no evidence to support the trial court’s implied findings. See Croucher v.
Croucher, 660 S.W.2d 55, 58 (Tex. 1983).
Appellee sued Appellant as “McLane Express, Inc. d/b/a The C.D. Hartnett Company.”
At trial the credit application containing the personal guaranty signed by Appellant was admitted
into evidence. Milliken, president of Hartnett, testified he personally approved the credit
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application signed by Appellant and explained the signing of the personal guaranty was a
prerequisite for Hartnett to extend credit terms to S&S. Milliken further testified Hartnett was
the current owner of the personal guaranty and was seeking to recover the amount owed on
S&S’s account based on the personal guaranty signed by Appellant.
Appellant is correct in pointing out that, at trial, Milliken agreed Hartnett had been sold.
Milliken’s response was given only after counsel for Hartnett asked if Milliken’s family had
owned the company for over 100 years until it was recently sold. Milliken’s response was
neither developed nor discussed further at trial. All of the evidence, when looked at most
favorably to support the judgment, is legally sufficient to show McLane Express, Inc. d/b/a The
C.D. Hartnett Company’s ownership of the personal guaranty signed by Appellant. See City of
Keller, 168 S.W.3d at 807; Weirich, 833 S.W.2d at 945. Moreover, after examining all the
evidence, we cannot say that the evidence supporting the trial court’s implied finding on the
element of the status of ownership of the personal guaranty is so contrary to the overwhelming
weight of the evidence as to be clearly wrong and unjust. Cain, 709 S.W.2d at 176.
Consideration
In his second sub-issue, Appellant argues the evidence conclusively established that the
guaranty was not supported by consideration. Hartnett responds that Appellant may not raise the
issue of lack of consideration on appeal in part, because Appellant failed to raise the issue in a
verified plea. We agree.
Appellant’s first amended original answer which contains a general denial and two
affirmative defenses fails to raise a lack of consideration defense. As a result, Appellant waived
that defense. See TEX.R.CIV.P. 93(9) (requiring verified plea that written instrument upon which
pleading is founded is without consideration, or that the consideration has failed in whole or part);
8
Murphy v. Canion, 797 S.W.2d 944, 949-50 (Tex.App. – Houston [14th Dist.] 1990, no writ)
(holding appellant waived defense that there was no consideration for agreement where he failed
to plead that defense by verified pleading).
Reasonable Diligence
In his third sub-issue, Appellant maintains the guaranty is unenforceable because Hartnett
failed to satisfy a condition precedent by failing to introduce any evidence that it used reasonable
diligence to collect the amount due on the open account from S&S. Appellant argues “[b]ecause
there was no proof of any diligence, Plaintiff did not prove it had the right to enforce the debt
against [Appellant].” In support of his argument, Appellant distinguishes between a guarantor of
payment and a guarantor of collection. It appears Appellant is arguing that he is a guarantor of
collection and not a guarantor of payment because Hartnett never argued that he was a guarantor of
payment or that he was jointly and severally liable.
Texas law recognizes a distinction between a “guaranty of collection (or conditional
guaranty)” and a “guaranty of payment (or unconditional guaranty).” Cox v. Lerman, 949 S.W.2d
527, 530 (Tex.App. – Houston [14th Dist.] 1997, no pet.). A guarantor of collection promises to
pay the debt if it cannot be collected from the primary obligor by the use of reasonable diligence.
See Material P’ships, Inc. v. Ventura, 102 S.W.3d 252, 265 (Tex.App. – Houston [14th Dist.]
2003, pet. denied) (Frost, J., concurring). Conversely, a guarantor of payment is primarily liable
and waives any requirement that the holder of the note take action against the maker as a condition
precedent to the guarantor’s liability. Cox, 949 S.W.2d at 530. Simply put, a guaranty of
payment is an obligation to pay the debt due if the debtor does not. See id. A guaranty
agreement is deemed to be a guaranty of payment unless the agreement specifies otherwise, which
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means the guarantor is jointly and severally liable on the debt and may be sued under the same
terms as the principal obligor. See TEX. BUS. & COM. CODE ANN. § 3.419(e) (West 2002).2
Under the “Individual Personal Guaranty” section of Hartnett’s credit application,
Appellant personally guaranteed to Hartnett “payment of any obligation of [S&S]” and agreed to
bind himself “to pay [Hartnett] on demand, any sum which may become due to [Hartnett] by
[S&S] whenever [S&S] shall fail to pay the same.” There is nothing in the language of the
personal guaranty signed specifying that Appellant’s guaranty was a guaranty of collection or that
it was conditioned upon Hartnett using reasonable diligence to collect from S&S after S&S failed
to pay on the debt owed. Based on the unconditional language of the personal guaranty, we
conclude it was a guaranty of payment and not of collection. See id. Therefore, as a guarantor
of payment, Appellant was primarily liable and waived any requirement that Hartnett take action
against S&S as a condition precedent to Appellant’s liability. See Cox, 949 S.W.2d at 530.
Because Appellant’s guaranty was a guaranty of payment, Hartnett was not required to show the
condition precedent of reasonable diligence, therefore the evidence is legally sufficient to support
the trial court’s implied finding that all conditions precedent to recovery under the guaranty of
payment had occurred.
Issue One is overruled.
SCOPE OF THE GUARANTY AGREEMENT
In Issue Two, Appellant argues that Hartnett can only recover against Appellant for
$6,202.02, the outstanding balance of the Territory 62 store, because Hartnett failed to prove
2
Section 3.419(e) provides that “[i]f the signature of a party to an instrument is accompanied by words indicating
that the party guarantees payment or the signer signs the instrument as an accommodation party in some other
manner that does not unambiguously indicate an intention to guarantee collection rather than payment, the signer is
obliged to pay the amount due on the instrument to a person entitled to enforce the instrument in the same
circumstances as the accommodated party would be obliged, without prior resort to the accommodated party by the
person entitled to enforce the instrument.”
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Appellant’s liability under the guaranty extended to all S&S store accounts. More specifically,
Appellant asserts there is a latent ambiguity in the credit application in which the personal
guaranty is found. Hartnett points out this issue was never raised in the trial court and as such,
maintains Appellant has waived his complaint on appeal.
Generally, a party is required to expressly plead affirmative defenses “and any other matter
constituting an avoidance or affirmative defense.” See TEX.R.CIV.P. 94; see also Woods v.
William M. Mercer, Inc. 769 S.W.2d 515, 518 (Tex. 1988). Ambiguity is an affirmative defense
that must be raised below. Gulf & Basco Co. v. Buchanan, 707 S.W.2d 655, 656 (Tex.App. –
Houston [1st Dist.] 1986, writ ref’d n.r.e.). The record shows Appellant never pleaded or
otherwise raised his ambiguity argument to the trial court. Additionally, there is nothing in the
record to indicate that the trial court sua sponte considered whether the credit application was
ambiguous. See Sage St. Assocs. v. Northdale Constr. Co., 863 S.W.2d 438, 445 (Tex. 1993)
(stating that a court may conclude a contract is ambiguous even in the absence of such a pleading
by the parties); May v. Buck, 375 S.W.3d 568, 579 (Tex.App. – Dallas 2012, no pet.) (same).
Because Appellant failed to present this issue in the trial court, his complaint was waived. See
TEX.R.APP.P. 33.1(a).
Issue Two is overruled.
SWORN ACCOUNT
In Issue Three, Appellant contends Hartnett failed to prove each element of its underlying
agreement or debt cause of action with competent evidence. He claims that “[a]bsent proof of
the underlying cause of action, the amount of the debt is not sufficiently established to hold
[Appellant] liable on the guaranty.” In reply, Hartnett urges that the record contains more than
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sufficient evidence to support the trial court’s implied finding Hartnett established each element of
the claim underlying its suit on the guaranty.
The essential elements of a suit on a sworn account include: (1) the sale and delivery of the
merchandise or performance of services; (2) the amount of the account is “just,” that is, the prices
charged are pursuant to an express agreement, or in the absence of an agreement, that the charges,
are usual, customary or reasonable; and (3) the outstanding amount remain unpaid. See Ellis v.
Reliant Energy Retail Servs., L.C.C., 418 S.W.3d 235, 246 (Tex.App. – Houston [14th Dist.]
2013, no pet. h.); see also Fain Family First Ltd. P’ship v. EOG Resources, Inc., No.
02-12-00081-CV, 2013 WL 1668281, at *2 (Tex.App. – Fort Worth Apr. 18, 2013, no pet.)
(mem. op., not designated for publication). Appellant argues the documentary evidence
presented at trial did not prove the sale and delivery of goods.
At trial, Milliken testified Harnett sold and delivered product to S&S on credit terms as a
result of the credit application signed by Appellant. He further testified a paper trail was created
when Hartnett sold and delivered merchandise on credit to S&S. Milliken explained that an
invoice was generated when a customer ordered product and Hartnett required a customer to sign a
receipt reflecting delivery of the product. Hartnett subsequently would mail a statement to the
customer for billing purposes.
Hartnett admitted several documents into evidence without objection to show product was
sold and delivered to S&S which included itemized invoices showing that goods were sold to the
different store locations owned and operated by S&S. A manifest accompanied each individual
invoice reflecting receipt of delivery. The manifests contained the following paragraph:
Agreement between buyer hereof, whose name appears above, and the
C.D. Hartnett Company hereof is that buyer has placed this order and by
his signature hereto, or that of his agent or employee acknowledges receipt
of the merchandise listed, and agrees to pay the C.D. Hartnett Company at
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its offices in Weatherford, Parker County, Texas, for same, within terms
as stated above. Interest shall accrue at 1 1/2% per month on the unpaid
balance after maturity. Reasonable attorney’s fees will be added if
collection forced.
All of the manifests except for the manifest associated with Invoice No. 127026 contain
signatures on the applicable customer and driver signature lines that precede the paragraph
referenced above. According to Milliken’s testimony, each of the invoices were for the product
sold and delivered to S&S by Hartnett and were the invoices that were not paid. Hartnett sold
and delivered merchandise to S&S as described in the documents that were admitted into
evidence. The total amount owed by S&S was $91,817.67 which included all offsets and
credits. The amount of the account was just and the prices charged were usual, customary, and
reasonable. Milliken further explained that at the time S&S filed bankruptcy, the outstanding
amount that remained unpaid was $91,817.67.
The record also shows Appellant testified he understood that he was being sued on an
amount for products S&S purchased for its stores. He further agreed that when he signed the
individual personal guaranty, S&S was already obligated to Hartnett for the product that Hartnett
sold and delivered to S&S. Appellant also stated that product was sold to S&S as part of the
credit application and he signed the guaranty as a president of the corporation to get the food as
credit.
Based on the record, we conclude the evidence is legally and factually sufficient to support
the trial court’s implied finding that there was a sale and delivery of goods to S&S. We also
conclude the evidence is legally and factually sufficient to establish a sworn account.
Quantum Meruit
Next, Appellant argues Hartnett is also not entitled to recover under a theory of quantum
meruit. Because we conclude the evidence in the record is sufficient to support the trial court’s
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implied finding that Hartnett proved each element to establish a sworn account, we need not
address Appellant’s complaint on Hartnett’s alternative quantum meruit theory. See
TEX.R.APP.P. 47.1. (“The court of appeals must hand down a written opinion that is as brief as
practicable but that addresses every issue raised and necessary to final disposition of the appeal.”).
Issue Three is overruled.
ATTORNEY’S FEES
In Issue Four, Appellant complains of the trial court’s award of attorney’s fees to Hartnett.
In its application for attorney’s fees filed on December 18, 2012, Hartnett requested attorney’s fees
pursuant to the personal guaranty upon which the suit was based and section 38.001 of the Texas
Civil Practice and Remedies Code. See TEX. CIV. PRAC. & REM. CODE ANN. § 38.001 (West
2008). In his affidavit for attorney’s fees, Mark S. Dugan, counsel for Hartnett, stated his client
incurred $59,235 in attorney’s fees in this case. Dugan also requested additional attorney’s fees
in the event of post-judgment discovery, an appeal, and a petition for review being granted by the
Texas Supreme Court. The trial court awarded Hartnett $59,235 in attorney’s fees. Appellant
argues the trial court erred by awarding attorney’s fees because Hartnett’s counsel’s affidavit for
attorney’s fees failed to comply with the requirements of section 18.001 of the Texas Civil Practice
and Remedies Code. See id. Appellant further argues the attorney’s fee award was not
supported by competent evidence and was excessive. We begin by addressing Appellant’s
second attorney’s fee complaint.
In general, we review a trial court’s award of attorney’s fees for an abuse of discretion.
Bocquet v. Herring, 972 S.W.2d 19, 20 (Tex. 1998). Texas courts have consistently held that an
attorney’s fee award must be supported by competent evidence. Torrington Co. v. Stutzman, 46
S.W.3d 829, 852 (Tex. 2000). A trial court’s award of attorney’s fees without sufficient
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supporting evidence constitutes an abuse of discretion. Sharp v. Broadway Nat’l Bank, 784
S.W.2d 669, 672 (Tex. 1990). The party seeking to recover attorney’s fees carries the burden of
proof to show reasonableness. Smith v. Patrick W.Y. Tam Trust, 296 S.W.3d 545, 547 (Tex.
2009). Whether a trial court’s award of attorney’s fees is reasonable is a question of fact. See
Bocquet, 972 S.W.2d at 20. In determining the reasonableness of attorney’s fees the following
eight factors are considered:
(1) [T]he time and labor required, the novelty and difficulty of the questions
involved, and the skill required to perform the legal service properly;
(2) [T]he likelihood…that the acceptance of the particular employment will
preclude other employment by the lawyer;
(3) [T]he fee customarily charged in the locality for similar legal services;
(4) [T]he amount involved and the results obtained;
(5) [T]he time limitations imposed by the client or by the circumstances;
(6) [T]he nature and length of the professional relationship with the client;
(7) [T]he experience, reputation, and ability of the lawyer or lawyers performing
the services; and
(8) [W]hether the fee is fixed or contingent on results obtained or uncertainty of
collection before the legal services have been rendered.
Arthur Andersen & Co. v. Perry Equp. Corp., 945 S.W.2d 812, 818 (Tex. 1997); Gaughan v. Nat’l
Cutting Horse Ass’n, 351 S.W.3d 408, 422 (Tex.App. – Fort Worth 2011, pet. denied).
In arguing that the award of attorney’s fees is not supported by competent evidence and is
excessive, Appellant asserts Hartnett’s attorney’s fee affidavit is legally insufficient. When
reviewing the legal sufficiency, we consider the evidence in the light most favorable to the
challenged finding and indulge ever reasonable inference that would support it. See City of
Keller, 168 S.W.3d at 822.
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Appellant contends the attorney’s fee affidavit was conclusory. He also maintains there is
no evidence upon which the trial court or he could have identified what time was excessive
because the affidavit was not supported by itemized timesheets or billing records. However, in
general, attorney’s fees do not have to be itemized. See Burnside Air Conditioning & Heating,
Inc. v. T.S. Young Corp., 113 S.W.3d 889, 898 (Tex.App. – Dallas 2003, no pet.); see also Town &
Country P’ship v. Frontier Leasing Corp., No. 01-07-00555-CV, 2009 WL 723991, at *4
(Tex.App. – Houston [1st Dist.] Mar. 19, 2009, no pet.) (mem. op., not designated for publication)
(explaining that attorney’s fee affidavit need not identify how many hours were spent on each
specific task and the corresponding charge). Furthermore, “‘billing records need not be
introduced to recover attorney’s fees.’” Sundance Minerals, L.P. v. Moore, 354 S.W.3d 507, 514
(Tex.App. – Fort Worth 2011, pet. denied) (quoting Air Routing Int’l Corp. (Can.) v. Britannia
Airways, Ltd., 150 S.W.3d 682, 692 (Tex.App. – Houston [14th Dist.] 2004, no pet.)).
The sworn affidavit of attorney Mark S. Dugan recited that his law firm was retained by
Hartnett to obtain a judgment against Appellant. Dugan stated he had been practicing law since
1984 and had been a shareholder at his firm for over twenty years. Dugan expressed his
familiarity with the legal fees customarily charged in Parker County, Texas and stated his billing
rate was $350 an hour. Dugan’s affidavit detailed the type of work performed by him, which
included preparing pleadings, a motion for summary judgment, conducting discovery, performing
legal research, trial preparation, drafting briefs, handling discovery disputes, preparing for a
summary judgment hearing, reviewing bankruptcy schedules, conversing with a Chapter 7 trustee,
and attending meetings with his clients to review documents and prepare for trial. Dugan stated
he had worked over 170 hours over the past several years working on Hartnett’s case. Dugan
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requested $59,235 in attorney’s fees and averred that these fees were reasonable, necessary, usual,
and customary fees for the type of services involved in the instant case.
We conclude Hartnett’s attorney’s fee affidavit was not conclusory; therefore, the affidavit
constituted sufficient evidence to support the trial court’s award of attorney’s fees. See Texas
Commerce Bank, Nat. Ass’n v. New, 3 S.W.3d 515, 517-18 (Tex. 1999) (holding attorney’s fee
affidavit was not conclusory and was legally sufficient where attorney testified that he was a duly
licensed attorney, familiar with usual and customary attorney’s fees in the area, and that based on
his knowledge of the services rendered, the attorney’s fee was reasonable).
Appellant further argues Hartnett’s attorney’s fee affidavit failed to comply with section
18.001(c)(3) of the Civil Practice and Remedies Code by not providing itemized statements. See
TEX. CIV. PRAC. & REM. CODE ANN. § 18.001(c)(3) (West 2008). Nonetheless, as already noted,
attorney’s fees do not have to be itemized. See Burnside Air Conditioning & Heating, 113
S.W.3d at 898; see also Town & Country P’ship, 2009 WL 723991, at *4. Furthermore, billing
records are not needed to recover attorney’s fees. Sundance Minerals, 354 S.W.3d at 514.
Lastly, Appellant argues Hartnett failed to serve a copy of the attorney’s fee affidavit on Appellant
at least thirty days before the day the trial court relied on it to render final judgment as required by
section 18.001(d) of the Civil Practice and Remedies Code. See TEX. CIV. PRAC. & REM. CODE
ANN. § 18.001(d) (West 2008). However, Appellant failed to raise this complaint in the trial
court in either his “Objection to Plaintiff’s Application for Attorneys’ Fees to Be Included in Final
Judgment” or motion for new trial; thus, it is waived on appeal. See TEX.R.APP.P. 33.1(a)(1)(A)
(to preserve a complaint for appellate review, the record must show that a party complained to
the trial court through a timely request, objection, or motion with sufficient specificity to make
the trial court aware of the complaint, and the trial court made a ruling on the complaint); see
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also Sheffield Dev. Co. v. Carter & Burgess, Inc., No. 02-11-00204-CV, 2012 WL 6632500, at
*16 (Tex.App. – Fort Worth Dec. 21, 2012, pet. dism’d) (mem. op., not designated for
publication) (concluding appellant waived complaint that attorney’s fee affidavit was
incompetent because it was not served within twenty-one days of hearing where appellant did not
object on that basis and had agreed to hearing and shortened notice).
Because we conclude the attorney’s fee affidavit supporting Harnett’s application for
attorney’s fees is not conclusory and is legally sufficient to support the trial court’s award of
attorney’s fees to Hartnett, the trial court did not abuse its discretion in making that award. See
Bocquet, 972 S.W.2d at 20.
Issue Four is overruled.
CONCLUSION
Having overruled Appellant’s four issues, we affirm the judgment of the trial court.
YVONNE T. RODRIGUEZ, Justice
November 7, 2014
Before McClure, C.J., Rivera, and Rodriguez, JJ.
Rivera, J., not participating
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