-
In The
Court of Appeals
Sixth Appellate District of Texas at Texarkana
______________________________
No. 06-09-00147-CR
______________________________
LEE EDWARD MORRIS, Appellant
V.
THE STATE OF TEXAS, Appellee
On Appeal from the 6th Judicial District Court
Lamar County, Texas
Trial Court No. 22425
Before Morriss, C.J., Carter and Moseley, JJ.
Memorandum Opinion by Justice Moseley
MEMORANDUM OPINION
Narcotics investigators were able to make an audio recording of Lee Edward Morris selling cocaine to confidential informants, and Morris was convicted by a jury of two counts of delivery of more than one, but less than four, grams of a controlled substance.[1] The jury also found the second of those deliveries occurred within 1,000 feet of a playground (a drug-free zone). Punishment was enhanced by Morris’s prior felony convictions for possession of a deadly weapon in a penal institution and engaging in organized criminal activity. Consequently, Morris was sentenced to fifty years’ imprisonment on the first count and seventy-five years’ imprisonment on the second count, to be served concurrently.
On appeal, Morris first complains that the trial court erred in overruling a Batson[2] challenge. We conclude the trial court did not clearly abuse its discretion in making its ruling. Morris next complains the trial court erred in seating the final jury panel, failing to require the court reporter to record a bench conference during voir dire, and in commenting on Morris’s right not to testify and present mitigating evidence during punishment. Because Morris’s trial counsel failed to preserve error on these points of error, they are overruled. Recognizing that preservation would likely prevent our review on certain points, Morris raised ineffective assistance of counsel in failing to object to the jury panel and the court’s allegedly impermissible comments during punishment. However, Morris failed to sufficiently demonstrate counsel’s ineffectiveness and we overrule his ineffective assistance of counsel claims.
I. The Trial Court Did Not Err in Overruling Morris’s Batson Challenge
The Equal Protection Clause of the Fourteenth Amendment to the United States Constitution prevents the exercise of peremptory strikes based on a prospective juror’s race. Batson v. Kentucky, 476 U.S. 79 (1986); Guzman v. State, 85 S.W.3d 242, 245 (Tex. Crim. App. 2002); Splawn v. State, 160 S.W.3d 103, 114 (Tex. App.—Texarkana 2005, pet. ref’d); see Tex. Code Crim. Proc. Ann. art. 35.21 (Vernon 2006).
Once a Batson challenge is raised, the trial court engages in a three-step inquiry. Purkett v. Elem, 514 U.S. 765, 767–68 (1995); Ford v. State, 1 S.W.3d 691, 693 (Tex. Crim. App. 1999); Montgomery v. State, 198 S.W.3d 67, 76 (Tex. App.—Fort Worth 2006, pet. ref’d). Under the first step, the person raising a Batson challenge is required to make a prima facie showing of racial discrimination. Ford, 1 S.W.3d at 693; Montgomery, 198 S.W.3d at 76. Once that prima facie showing is accomplished, the burden shifts to the State to present a racially neutral reason for the challenged jury strikes. Ford, 1 S.W.3d at 693; Montgomery, 198 S.W.3d at 76. Third, and finally, once the State’s reason is proffered, the burden of persuasion shifts back and the person raising the challenge must then convince the court that the reason given by the State was not race-neutral, and was merely pretext for concealing discrimination. Ford, 1 S.W.3d at 693 (citing Purkett, 514 U.S. at 767–68).
We review the evidence relevant to the Batson challenge in the light most favorable to the trial court’s ruling. Cantu v. State, 842 S.W.2d 667, 689 (Tex. Crim. App. 1992); Roberts v. State, 963 S.W.2d 894, 899 (Tex. App.—Texarkana 1998, no pet.). A high degree of deference is given to the trial court, who is in the best position to determine if the State’s facially neutral explanation for a peremptory strike is genuine. Splawn, 160 S.W.3d at 114 (citing Jasper v. State, 61 S.W.3d 413, 421–22 (Tex. Crim. App. 2001)). Thus, a “clearly erroneous” standard of review is applied to the trial court’s decision to overrule a Batson challenge. Hernandez v. New York, 500 U.S. 352, 369 (1991); Splawn, 160 S.W.3d at 114 (citing Gibson v. State, 144 S.W.3d 530, 534 (Tex. Crim. App. 2004)). A finding is clearly erroneous where the reviewing court “is left with the definite and firm conviction that the trial court committed a mistake.” Roberts, 963 S.W.2d at 899.
During voir dire, the State individually elicited veniremember responses to the following inquiry:
There are a number of theories about why jurors do what they do, and jurors punish and return the verdicts that they return, because in the same case, same set of facts, two separate juries will do two completely different things.
So people who study this sort of thing have found three common themes among jurors, why jurors set the sentences that they do. Some jurors will return a sentence because they want to keep other people from committing the same or similar crimes [punishment theory one]; . . . .
Some jurors favor number two, rehabilitation; we’re going to try to help the person who has committed this crime, we’re going to give them probation, or we’re going to recommend that they go to a mental hospital, or whatever the case might be.
. . . some jurors out there just want to punish that defendant for what he’s done, to send a message to him [punishment theory three] . . . .
. . . . I want to find out from you which of these theories you subscribe to.
After the State presented its list of peremptory strikes, Morris’s counsel objected that the State improperly struck Sarah Williams (juror number eight) and Elane Hill (juror number eleven) from the jury based on their African-American race. The State proffered this race-neutral reason for striking Williams and Hill:
The Court may recall that I asked the jury panel, as a whole, their particular theories on punishment, whether it was the deterrence, rehabilitation or punishment for punishment’s sake. I asked the jurors to give me their number, one, two or three, whichever one they chose.
Two was rehabilitation. If a juror felt that rehabilitation would be the guiding principle or the theory behind which he would set punishment, I wrote down by that juror’s name, two. I went back to the jury room, and in counting up the numbers, I discovered that 12 potential jurors had identified rehabilitation as the theory behind how they would assess punishment, or the criteria they would use to assess punishment in this case.
I think [Morris’s counsel] would agree with me, this is a punishment case. Guilt is not the real issue here. Both transactions were captured on videotapes. The real issue in this case is going to be what kind of sentence is the defendant going to receive.
All of the jurors that answered, rehabilitation, I struck. There were white jurors, there were black jurors, there were some jurors that, quite frankly, I would like to have kept. I struck every juror, white, black, Hispanic, Indian, Asian, whoever they were, I struck every single juror that answered rehabilitation as their punishment theory.
Indeed, each of the veniremembers peremptorily struck by the State (including Williams and Hill) responded affirmatively that they believed in the theory of punishment number two posited by the State––rehabilitation. The State pointed out that it exhausted its peremptory strikes and would have struck even more members of the jury pool who believed in the second theory of punishment if it had additional strikes. Once the State’s reasoning was offered, and it was confirmed that all the veniremembers struck by the State responded they believed in the second theory, Morris’s counsel failed to argue that the State’s reasoning was pretext for discrimination. Counsel merely stated he was “making an objection for the record.”
In Montgomery and Victor, our sister courts found that “a veniremember’s belief in rehabilitation as the primary goal of punishment is a race-neutral reason for the exercise of a peremptory challenge.” Montgomery, 198 S.W.3d at 76; Victor v. State, 995 S.W.2d 216, 222 (Tex. App.—Houston [14th Dist.] 1999, pet. ref’d). We conclude that the trial court’s finding (i.e., that the State proffered a sufficient race-neutral reason for striking Williams and Hill and that Morris failed to meet his burden of persuasion to demonstrate otherwise) was not clearly erroneous. See Splawn, 160 S.W.3d at 115.
In his appellate brief, Morris additionally argues that the State struck jurors thirty-one and thirty-two, but did not strike juror number thirty, who also subscribed to the rehabilitation punishment theory. However, this challenge to the State’s race-neutral reason was never presented to the trial court.[3] Because the trial court was thus unable to consider this argument, it is not preserved for our consideration.
Morris’s first point of error is overruled.
II. Morris Did Not Preserve Remaining Claims of Trial Court Error
A. Seating a Peremptorily Struck Juror on the Jury Panel
Morris’s counsel peremptorily struck “Ricky Bond” and listed him as juror number “36.” A review of the jury list reveals that Bond was actually juror number 35 and that juror number 36 was Gary Reed, who was not chosen to be on the jury and whose name did not appear on either strike list. Morris argues on appeal that the trial court erred in allowing Bond to sit on the jury and also erred because “Reed should be juror #9 instead of Bond.”
“It is well settled that it is the responsibility of the parties to assure that the jury impaneled does not include a juror that has been struck.” Jackson v. State, 826 S.W.2d 751, 752 (Tex. App.—Houston [14th Dist.] 1992, pet. ref’d); see also Miller v. State, 692 S.W.2d 88, 93 n.10 (Tex. Crim. App. 1985). The party must object before the panel is sworn, or else show that the juror was otherwise disqualified because of prejudice toward the appellant. Jackson, 826 S.W.2d at 752; Miller, 692 S.W.2d at 93 n.10. No objection was lodged to Bond being seated on the jury as opposed to Reed, and Morris’s counsel affirmatively stated he did not contest any jury member’s qualification to sit on the panel.
B. Failure of Court Reporter to Record Bench Conference
Morris next complains that the trial court denied him the right of review by “failing to make the services of the court reporter available” during a bench conference.[4] It is uncontested that the court reporter was available and present in the courtroom during the bench conference, but failed to record it. Morris cites this Court to the rule stating that a court reporter has a duty to record all proceedings unless expressly waived. Tex. R. App. P. 13.1. We have previously held that this Rule does not excuse counsel from the requirement to preserve error through an objection if the court reporter fails to make a record as required. Rittenhouse v. Sabine Valley Ctr. Found., Inc., 161 S.W.3d 157, 161 (Tex. App.—Texarkana 2005, no pet.); see also Jones v. State, 942 S.W.2d 1, 2 (Tex. Crim. App. 1997) (en banc) (objection required to preserve error stemming from failure to transcribe voir dire proceedings)[5]; Valle v. State, 109 S.W.3d 500, 508–09 (Tex. Crim. App. 2003) (holding objection required to preserve error if bench conference not recorded). Counsel for Morris failed to object to the failure of the court reporter to transcribe the bench conference.
C. Comment on Morris’s Right Not to Testify and Present Mitigating Evidence
Immediately after the enhancement paragraphs were read during the punishment phase of the trial, the court advised Morris “that you have the right to remain silent during the punishment phase of the trial and to present evidence of mitigation at punishment. Do you understand that?,” to which Morris replied “Yes, sir.” In his appellate brief, Morris interprets this exchange as an improper comment on his right not to testify and present mitigating evidence in front of the jury. Again, counsel failed to object to the trial court’s comments, perhaps because he felt the court’s comments were merely an admonishment, rather than improper comments.
D. Lack of Preservation Prevents Our Review
In order to preserve these points of error for our review, Morris was required to present a timely, specific objection to the trial court and secure an adverse ruling. Tex. R. App. P. 33.1; Fox v. State, 175 S.W.3d 475, 481 (Tex. App.—Texarkana 2005, pet. ref’d). Because his counsel failed to object to the above alleged errors regarding the failure of the court reporter to transcribe the bench conference and the comments by the trial court, they were unpreserved and nothing is presented for our review. Thus, they are overruled.
III. The Record Does Not Demonstrate that Morris’s Counsel Was Ineffective
In his final point, Morris argues that his counsel was ineffective for failing to object to Bond’s placement on the jury, Reed’s exclusion from the jury, and the trial court’s alleged improper comments on Morris’s failure to testify and present mitigating evidence.
A. Standard of Review
Morris’s allegations of his counsel’s ineffectiveness must be firmly founded in the record. Goodspeed v. State, 187 S.W.3d 390, 392 (Tex. Crim. App. 2005); Thompson v. State, 9 S.W.3d 808, 813 (Tex. Crim. App. 1999); Wallace v. State, 75 S.W.3d 576, 589 (Tex. App.—Texarkana 2002), aff’d, 106 S.W.3d 103 (Tex. Crim. App. 2003). “Trial counsel should ordinarily be afforded an opportunity to explain his actions before” we find the attorney’s performance was ineffective. Goodspeed, 187 S.W.3d at 392; Rylander v. State, 101 S.W.3d 107, 111 (Tex. Crim. App. 2003); Fox, 175 S.W.3d at 485–86. Absent such opportunity, we will not find deficient performance unless the challenged conduct was “so outrageous that no competent attorney would have engaged in it.” Goodspeed, 187 S.W.3d at 392; Fox, 175 S.W.3d at 486. For this reason, direct appeal is usually an inadequate vehicle for raising such a claim because the record is generally undeveloped. Thompson, 9 S.W.3d at 813–14; Fox, 175 S.W.3d at 485.
We evaluate Morris’s ineffective assistance of counsel claims using the two-part Strickland test formulated by the United States Supreme Court, which requires a showing of both deficient performance and resulting prejudice. Strickland v. Washington, 466 U.S. 668, 687–88 (1984); Thompson, 9 S.W.3d at 812; Fox, 175 S.W.3d at 485. Under the first prong of the Strickland test, Morris must show that his counsel’s representation fell below an objective standard of reasonableness. Fox, 175 S.W.3d at 485 (citing Tong v. State, 25 S.W.3d 707, 712 (Tex. Crim. App. 2000)). There is a strong presumption that counsel’s conduct fell within the wide range of reasonable professional assistance and that the challenged action could be considered sound trial strategy. Strickland, 466 U.S. at 689; Ex parte White, 160 S.W.3d 46, 51 (Tex. Crim. App. 2004); Tong, 25 S.W.3d at 712. Therefore, we will not second guess the strategy of Morris’s counsel through hindsight. Blott v. State, 588 S.W.2d 588, 592 (Tex. Crim. App. 1979); Hall v. State, 161 S.W.3d 142, 152 (Tex. App.—Texarkana 2005, pet. ref’d). In this case, since the record is silent as to why counsel failed to object to Bond’s inclusion on the jury, Reed’s exclusion from the jury, and the court’s allegedly improper comments on Morris’s failure to testify and present mitigating evidence, we will assume it was due to any strategic motivation that can be imagined. Mata v. State, 226 S.W.3d 425, 431 (Tex. Crim. App. 2007); Garcia v. State, 57 S.W.3d 436, 441 (Tex. Crim. App. 2001); Fox, 175 S.W.3d at 485–86.
The second Strickland prong requires a showing that the deficient performance prejudiced the defense to the degree that there is a reasonable probability that, but for the attorney’s deficiency, the result of the trial would have been different. Strickland, 466 U.S. at 689; Tong, 25 S.W.3d at 712. A reasonable probability “is a probability sufficient to undermine confidence in the outcome.” Mitchell v. State, 68 S.W.3d 640, 642 (Tex. Crim. App. 2002). Failure to satisfy either prong of the Strickland test is fatal. Ex parte Martinez, 195 S.W.3d 713, 730 (Tex. Crim. App. 2006).
B. Failure to Object to Jury Selection
There is no record explaining counsel’s reasons for failing to object to Bond’s inclusion and Reed’s exclusion from the jury panel. Counsel’s peremptory strike lists Bond’s name, but incorrectly cites his juror number as Reed’s juror number. Thus, it is possible counsel’s intention was to strike Reed and keep Bond on the jury panel. Absent a record demonstrating otherwise, we apply the strong presumption that counsel’s conduct fell within the wide range of reasonable professional assistance. Strickland, 466 U.S. at 689; White, 160 S.W.3d at 51; Tong, 25 S.W.3d at 712.
Morris attempts to meet the second Strickland prong by arguing that since Reed believed in rehabilitation punishment theory (second theory), and Bond believed in punishing a defendant to send a message (third theory), his sentence would have been less severe if Reed had been seated on the jury instead of Bond. Yet, the makeup of the final jury consisted of four jurors who believed in the third theory of punishment and two jurors who believed in the second theory of punishment. Placing Reed on the jury would have led to an equal amount of jurors believing in the second and third punishment theories. In any event, the remaining majority of jurors believed in the first theory of punishment—prevention of further crime. Given the evidence in this case and the fact that jurors representing all three theories of punishment rendered a unanimous verdict as to sentencing as instructed by the trial court’s charge, Morris cannot demonstrate with reasonable probability that the result of the trial would have been different absent his counsel’s alleged error.
C. Failure to Object to Trial Court’s Allegedly Improper Comment on Failure to Testify and Present Mitigating Evidence
Finally, Morris argues that his counsel was ineffective for having failed to lodge an objection to the trial court’s instruction to Morris in the presence of the jury that he had the right to remain silent and the right to present mitigating evidence. It is possible that counsel believed that the court’s comments favorably aided in explaining to the jury that Morris was neither required to testify nor present mitigating evidence. Alternatively, even if counsel believed the trial court’s comment was damaging, counsel may have taken the position that to lodge an objection would have served little purpose except to draw the jury’s attention to Morris’s failure to testify or the lack of mitigating evidence, thereby magnifying its significance. Again, absent a record containing counsel’s explanations, we will not find deficient performance since the failure to object in this circumstance was not “so outrageous that no competent attorney would have engaged in it.” Goodspeed, 187 S.W.3d at 392; Fox, 175 S.W.3d at 486.
Moreover, the jury charge instructed the jury not to consider Morris’s failure to testify and to only consider facts in evidence. Absent evidence to the contrary, we will presume that the jury followed the trial court’s instructions in the charge. See Reynolds v. State, 227 S.W.3d 355, 367 (Tex. App.—Texarkana 2007, no pet.). Thus, because the jury presumably followed the charge, Morris is unable to demonstrate the result of the trial would have been different absent trial counsel’s alleged error.
IV. Conclusion
We affirm the judgment of the trial court.
Bailey C. Moseley
Justice
Date Submitted: April 14, 2010
Date Decided: April 23, 2010
Do Not Publish
[1]Laboratory reports found 1.14 grams and 1.56 grams of cocaine were contained in the deliveries.
[2]Batson v. Kentucky, 476 U.S. 79 (1986).
[3]A “defendant who raises a Batson claim at trial forfeits his opportunity to complain on appeal about what his response to the State’s race neutral reasons would have been when he fails to timely present his evidence in rebuttal of the State’s race neutral reasons.” Hill v. State, No. 10-03-00281-CR, 2005 WL 170552, at *1 (Tex. App.––Waco Jan. 26, 2005, pet. ref’d) (mem. op., not designated for publication).
[4]Morris concedes that the trial court was taking up challenges for cause during the bench conference, a portion of which was recorded by the reporter. The Batson challenge was made after the bench conference, which was fully recorded and preserved for our review. Since Morris has not proffered a point of error dealing with challenges for cause, we have not been shown how the omitted portion of the bench conference would hinder our review of this appeal.
[5]Morris challenges that Rule 34.6 of the Texas Rules of Appellate Procedure entitles him to a new trial if a significant portion of the reporter’s record is lost or destroyed. Tex. R. App. P. 34.6. As Jones discusses, since the record was never created, this Rule will not apply. 942 S.W.2d 1, 2.
the fraudulent lien statute. At most, it creates a genuine issue of material fact for a jury’s resolution.
Section 51.901(c) of the Texas Government Code provides that “[f]or purposes of this section” a document or instrument “is presumed to be fraudulent” if:
[T]he document or instrument purports to create a lien or assert a claim against real or personal property or an interest in real or personal property and:
. . . .
(B) is not created by implied or express consent or agreement of the obligor, debtor, or the owner of the real or personal property or an interest in the real or personal property, if required under the laws of this state, or by implied or express consent or agreement of an agent, fiduciary, or other representative of that person.
Tex. Gov’t Code Ann. § 51.901(c)(2)(B) (Vernon Supp. 2009).
As a final attempt at meeting the statutory requirements of Section 12.002, Roberts suggests that this Court should apply the Government Code presumptions. Roberts’ argument is based on a reference to this Government Code section in Section 12.006 of the Texas Civil Practice and Remedies Code, which discusses awarding plaintiffs costs of suit. Our sister court has rejected Roberts’ suggested application. Centurion Planning Corp., 176 S.W.3d at 507. The court in Centurion reasoned that the Legislature did not define fraudulent lien in the Texas Civil Practice and Remedies Code, and could have easily referred to Section 51.091. Id. In its reasoning, the court pointed out that the Texas Government Code did not define fraudulent lien, but rather established presumptions which would apply under certain circumstances. Id. As our sister court did in Centurion, we decline to extend application of the Government Code presumptions to Section 12.002. Moreover, a plain reading of Section 12.002 suggests that even should this Court apply the Government Code presumption, it would only aid Roberts with respect to the first element of the fraudulent lien statute. In other words, evidence of intent as a matter of law would still be required.
Because there was a fact question on the issue of Walker’s knowledge that the document was a fraudulent lien and the intent to cause financial harm, we reverse the trial court’s fraudulent lien summary judgment against WAS and remand for trial on the merits.
C. Usurious Interest Award Under Section 305.004 Was Error
Section 305.004 provides for additional monetary damage if a creditor charges and receives more than twice the legal rate of interest. Tex. Fin. Code Ann. § 305.004 (Vernon 2006). Compare with § 305.003 (states creditor liable if he or she “charges or receives” usurious interest). Because there is no summary judgment evidence demonstrating WAS received any interest payments, we hold that granting summary judgment for usurious interest under Section 305.004 of the Texas Finance Code was error. See C&K Invs. v. Fiesta Group, Inc., 248 S.W.3d 234, 250–51 (Tex. App.—Houston [1st Dist.] 2007, no pet.); Aguilar v. Anderson, 855 S.W.2d 799, 803 (Tex. App.—El Paso 1993, writ denied) (citing Cook v. Frazier, 765 S.W.2d 546, 553 (Tex. App.—Fort Worth 1989, no writ)).
The trial court’s summary judgment based on Section 305.004 and the applicable attorney’s fee award are reversed and remanded for trial on the merits.[10]
D. While Roberts Established Elements of Usury Under Section 305.003, Damage Fact Questions Remained
WAS claims the essential elements of usury were not shown. The essential elements of a usurious transaction are: “(1) a loan of money, (2) an absolute obligation to repay the principal, and (3) the exaction of a greater compensation than allowed by law for the use of the money by the borrower.” First Bank v. Tony’s Tortilla Factory, Inc., 877 S.W.2d 285, 287 (Tex. 1994). The Texas Finance Code defines the term “loan” as “an advance of money that is made to or on behalf of an obligor, the principal amount of which the obligor has an obligation to pay the creditor,” and an “obligor” is “a person to whom money is loaned or credit is otherwise extended.” Tex. Fin. Code Ann. § 301.002(a)(10), (13) (Vernon 2006). A “creditor” is “a person who loans money or otherwise extends credit.” See Tex. Fin. Code Ann. § 301.002(a)(3) (Vernon 2006).
1. A loan of money
WAS argues that Roberts did not establish a loan of money as a matter of law. This argument was addressed and rejected in 271 Truck Repair & Parts, Inc. v. First Air Express, Inc., which “conclude[d] that the . . . plain meaning of “creditor” includes suppliers of goods or services when they charge interest on past due amounts.” No. 03-07-00498-CV, 2008 WL 2387630, at *9 (Tex. App.—Austin June 11, 2008, no pet.) (mem. op.). In its reasoning, 271 Truck Repair cited several Texas cases holding that suppliers of goods or services charged usurious interest rates. Id. (citing Strasburger Enters., Inc. v. TDGT Ltd. P’ship, 110 S.W.3d 566, 574 (Tex. App.—Austin 2003, no pet.); William C. Dear & Assocs., Inc. v. Plastronics, Inc., 913 S.W.2d 251, 253–54 (Tex. App.—Amarillo 1996, writ denied) (usury violation based on interest charged in invoice for investigatory services); Douglas Electronics, Inc. v. Pinnacle Sys., Inc., 805 S.W.2d 852, 856–57 (Tex. App.—Corpus Christi 1991, no writ); Commerce, Crowdus & Canton, Ltd. v. DKS Constr., Inc., 776 S.W.2d 615, 616–18 (Tex. App.—Dallas 1989, no writ) (applied usury statutes to extension of credit under construction contracts)). Similarly, we find WAS to be a creditor because services were supplied and interest was charged on past due amounts. See Broady v. Johnson, 763 S.W.2d 832, 834 (Tex. App.—Texarkana 1988, no pet.) (landowner charged usurious interest on contract for service allowing cattle to be pastured on his land).
2. An absolute obligation to repay the principal
WAS filed a suit on sworn account stating Roberts was “bound to pay Plaintiff its designated price.” Walker signed an affidavit in which he stated that “$25,148.73 [was] due and payable,” implying an obligation to repay the principal balance. Nevertheless, WAS next asserts that even if it can be considered a creditor, there was no absolute obligation that the principal be repaid.
In rejecting this argument, we note that courts have found usury statutes applicable to open accounts because they extend credit from the date of purchase to the date of payment, which is expected to be repaid. Domizio v. Progressive County Mut. Ins. Co., 54 S.W.3d 867, 874 (Tex. App.—Austin 2001, pet. denied) (“The normal loan transaction involves credit, and in an open account transaction, credit is extended from the date of purchase to the date of payment. A violation of the usury statute in those cases results from a credit transaction.”); Commerce, Crowdus & Canton, 776 S.W.2d at 616–18; Potomac Leasing Co. v. Housing Auth. of City of El Paso, 743 S.W.2d 712, 713 (Tex. App.—El Paso 1988, writ denied) (“Under the open account transaction, credit is extended from the date of purchase to the date of payment.”). This theory is consistent with holdings in cases where invoices for services rendered in connection with a contract supported the trial court judgments finding usury violations. William C. Dear & Assocs., 913 S.W.2d at 253–54; Douglas Electronics, Inc., 805 S.W.2d at 856—57; Commerce, Crowdus & Canton, 776 S.W.2d at 616–18; Broady, 763 S.W.2d at 834.
Thus, we conclude WAS “otherwise extended credit” to Roberts amounting to an absolute obligation by Roberts to repay the principal. Tex. Fin. Code Ann. § 301.002(a)(3). This element has been met.
3. Exaction of greater compensation than allowed by law
Next, we address whether Roberts was charged interest in an amount greater than allowed by law. Section 302.002 of the Texas Finance Code states, “[i]f a creditor has not agreed with an obligor to charge the obligor any interest, the creditor may charge and receive from the obligor legal interest at the rate of six percent a year.” Tex. Fin. Code Ann. § 302.002 (Vernon 2006). Here, as per Walker’s admission, since there was no contract with WAS establishing the interest rate, “the statutory rate of six percent [was] read into the agreement and bec[ame] the maximum rate allowed on the transaction.” All Seasons Window & Door Mfg. v. Red Dot Corp., 181 S.W.3d 490, 497 (Tex. App.—Texarkana 2005, no pet.); Broady, 763 S.W.2d at 834.
Walker cites this Court to the Prompt Payment Act in Sections 28.002 and 28.004 of the Texas Property Code to support his argument that the Act legally allowed 1.5 percent to be charged each month. See Tex. Prop. Code Ann. §§ 28.002, 28.004 (Vernon 2000). That statute allows a contractor to require payment for an amount “that is allowed to the contractor under the contract for properly performed work . . . .” An unpaid invoice bears interest at 1-1/2 percent a month. Id. Here, WAS billed Roberts for $22,940.00, an amount not due and owing to it. Thereafter, WAS added late charges and interest of 1-1/2 percent monthly. Accordingly, the Prompt Payment Act is inapplicable to WAS in this instance.
“A creditor who charges or receives legal interest” greater than six percent per annum “is liable to the obligor.” Tex. Fin. Code Ann. § 305.003 (Vernon 2006). It is undisputed that WAS charged more than the six percent maximum rate allowed. Thus, Roberts met its burden to prove interest charged by WAS was usurious under Section 305.003.
E. WAS Did Not Cure This Usurious Interest Violation
The applicable statute regarding cure states:
With respect to a defendant filing a counterclaim action alleging usurious interest in an original action by the creditor, the defendant shall provide notice[11] complying with Subsection (b) at the time of filing the counterclaim and, on application of the creditor to the court, the action is subject to abatement for a period of 60 days from the date of the court order. During the abatement period the creditor may correct a violation. As part of the correction of the violation, the creditor shall offer to pay the obligor’s reasonable attorney’s fees as determined by the court based on the hours reasonably expended by the obligor’s counsel with regard to the alleged violation before the abatement. A creditor who corrects a violation as provided by this subsection is not liable to an obligor for the violation.[12]
Tex. Fin. Code Ann. § 305.006(d) (Vernon 2006) (emphasis added).
WAS argues that the usurious interest charges were cured because it only prayed for the principal balance in its pleadings, and it produced a document evidencing some sort of credit to Roberts for the purported usurious interest after Roberts’ partial motion for summary judgment was filed. It relies on a single case from the Fifth Circuit to support this position, In re CPDC, Inc., 337 F.3d 436 (5th Cir. 2003). In CPDC, the court decided that a pre-suit notice sent by the creditor, which informed the debtor that the interest it charged was usurious and renegotiated the interest, renounced any right to receive usurious interest and was thus sufficient to cure the violation. Id. at 439, 446. Importantly, the court’s opinion was based on Section 305.103 of the Texas Finance Code, which states:
(a) A creditor is not liable to an obligor for a violation of this subtitle if:
(1) not later than the 60th day after the date the creditor actually discovered the violation, the creditor corrects the violation as to that obligor by taking any necessary action and making any necessary adjustment, including the payment of interest on a refund, if any, at the applicable rate provided for in the contract of the parties; and
(2) the creditor gives written notice to the obligor of the violation before the obligor gives written notice of the violation or files an action alleging the violation.
Tex. Fin. Code Ann. § 305.103 (Vernon 2006) (emphasis added).
This statute, addressing pre-suit cure, does not apply to this case because WAS did not give Roberts notice of the usury violation first, and the attempted cure came only after the filing of suit. By failing to offer to pay Roberts’ attorney’s fees, WAS failed to comply with post-suit cure statute Section 305.006(d). Bair Chase Prop. Co., 260 S.W.3d at 143 n.6 (distinguishing Pagel v. Whatley, 82 S.W.3d 571 (Tex. App.—Corpus Christi 2002, pet. denied), held creditor cured usury violation by deleting charges of interest and making demand for principal only because it was based on Section 305.103);[13] Strasburger Enters., Inc., 110 S.W.3d at 577 (holding under Section 305.103 that “a pleading alone is insufficient to serve as a notice to correct a usurious violation when not delivered to the obligor before the obligor communicates notice of a violation to the creditor”).
F. There Are Fact Questions Regarding the Trial Court’s Usurious Interest Award
The trial court awarded a total of $8,385.60 for alleged violations of Sections 305.003 and 305.004, but erred in granting summary judgment under Section 305.004. Therefore, in accordance with Section 305.003, WAS was liable to Roberts only for an amount “equal to the greater of: (1) three times the amount computed by subtracting the amount of legal interest allowed by law from the total amount of interest charged or received; or (2) $2,000.00 or twenty percent of the amount of the principal, whichever is less.” Tex. Fin. Code Ann. § 305.003.
The legal interest is simple to calculate. The trial court determined, with support from WAS invoices presented during summary judgment, that “the principal amount on which the interest [was] charged and received” was $1,979.76. Twenty percent of this principal amount is $395.95. However, interest charged presents an issue of fact.
It appears that the trial court relied on a summary prepared by Roberts as to the amount of interest charged indicating the total finance and interest charges was $1,750.95. The summary adds late fees assessed at $35.00 per month. WAS contends it was error for the trial court to include late fees into the damage calculation. We disagree.[14] Several Texas courts have held that late fees without contractual right to charge them are considered usurious interest. Seiter v. Veytia, 756 S.W.2d 303, 305 (Tex. 1988) (citing Dixon v. Brooks, 604 S.W.2d 330, 333 (Tex. Civ. App.—Houston [14th Dist.] 1980, writ ref’d n.r.e.) (reasoning late charge is “compensation for the . . . detention of money” under Section 301.002(4) and is therefore interest); Windhorst v. Adcock Pipe & Supply, 547 S.W.2d 260, 260–61 (Tex. 1977) (holding finance charge on open account was interest); Watson v. Cargill, Inc., Nutrena Div., 573 S.W.2d 35, 42 (Tex. Civ. App.—Waco 1978, writ ref’d n.r.e.)).[15] Thus, the trial court was authorized to include the late fees into the damage calculation.
However, Roberts’ summary showing that the total amount charged for interest and late fees was $1,750.95 presents a fact question. The invoices sent by WAS to Roberts are in the record. Beginning on July 30, 2004, late fees (finance charge) and interest were charged to Roberts beginning on a monthly basis. From July until December 2004, WAS sent a monthly statement to Roberts for a $35.00 late charge and an additional amount for interest. In 2005, it appears no statement was sent until December 30, 2005, at which time a statement for $630.00 was sent for a late charge for eighteen units (months) at $35.00 per unit. Likewise, on the same date a statement was sent for $505.01 as finance charges on the overdue balance. Both of these December statements appear to include all interest and late charges to that date. However, the summary presented by Roberts calculates the total amount of interest charged, including late fees, to include each of the monthly charges in 2004 and also the summarized balance as noted in the December 2005 statements. If that is correct, the 2004 charges were included twice. The factual dispute is further demonstrated by a final WAS invoice suggesting that the total amount of late fees and interest charged was actually $1,521.98. $1,521.98 is the result of $1,750.95 less the additional 2004 charges listed on the summary.
So it appears a fact question exists as to whether the 2004 charges for interest and late fees were included twice as the interest charged in calculating damages.
We would modify the judgment and calculate the correct amount if the evidence established conclusively that a double recovery for 2004 interest was had. However, our observations merely present a fact issue which precluded summary judgment. Thus, we remand the issue of amount of damage to be awarded.
III. Admission of the Thacker Statements Was Proper
The Thacker statements read, “I . . . was told on different occasions to put 3 ft of clay base on the racetrack by . . . Dennis Walker and this is what was agreed to by Dennis Walker and Royce Roberts.” “Hearsay included within hearsay is not excluded under the hearsay rule if each part of the combined statements conforms with an exception to the hearsay rule.” Tex. R. Evid. 805. The Walker Group contends the trial court erred in failing to sustain their objection that the Thacker statements contain hearsay within hearsay. However, according to Texas Rule of Evidence 801, the statements are nonhearsay within nonhearsay.
The admission or exclusion of evidence is a matter within the sound discretion of the trial court. Daniels v. Yancey, 175 S.W.3d 889, 895 (Tex. App.—Texarkana 2005, no pet.) (citing City of Brownsville v. Alvarado, 897 S.W.2d 750, 753 (Tex. 1995)). Thus, we review the admission of the Thacker statements for abuse of discretion. Id. A trial court abuses its discretion when it acts without regard for any guiding rules or principles. Holtzman v. Holtzman, 993 S.W.2d 729, 734 (Tex. App.—Texarkana 1999, pet. denied) (citing Downer v. Aquamarine Operators, 701 S.W.2d 238 (Tex. 1985)).
Hearsay “is a statement, other than one made by the declarant while testifying at the trial or hearing, offered in evidence to prove the truth of the matter asserted.” Tex. R. Evid. 801(d). Declarations of third persons may be binding on a party as vicarious admissions when made by the party’s agent or servant concerning a matter within the scope of the agency or employment and made during the existence of the relationship. 35 Tex. Jur. 3d Evidence §§ 232, 234 (2008). Thacker’s statement is such a declaration. A “statement by the party’s agent or servant concerning a matter within the scope of his or her agency or employment, made during the existence of the relationship” is considered to be an admission by a party opponent and is not hearsay. Tex. R. Evid. 801(e)(2)(D). David Thacker was WAC’s foreman and supervisor. Allen Thacker was the equipment operator. Both Thackers were employed by the Walker Group and were authorized to discuss the job requirements, including the amount of clay needed on the track, with Roberts and Richey. The trial court was justified in its implied finding that the statements made by the Thackers, that they were “told on different occasions to put three feet of clay base,” “this is what was agreed to by Dennis Walker and Royce Roberts,” they were told on November 4, 2004, “to pick up all . . . equipment and leave,” and that Walker “was not putting over one foot of clay on track,” were matters within the scope of their employment and were made during the existence of their employment relationship with Walker. See Southmark Mgmt. Corp. v. Vick, 692 S.W.2d 157, 160 (Tex. App.—Houston [1st Dist.] 1985, writ ref’d n.r.e.).
Further, any statement by a party opponent is admissible against that party. Bay Area Healthcare Group, Ltd. v. McShane, 239 S.W.3d 231, 235 (Tex. 2007). The Thacker statement implies that Walker told Thacker to put down three feet of clay. This would be an admission by party opponent since the statements were being offered by Roberts. See Trencor, Inc. v. Cornech Mach. Co., 115 S.W.3d 145, 151–52 (Tex. App.—Fort Worth 2003, pet. denied). Thus, the trial court correctly determined the Thacker statements were not hearsay.
IV. Legally and Factually Sufficient Evidence Supported the Jury Verdict
A jury was empanelled to determine the remaining issues. The test for legal sufficiency is “whether the evidence at trial would enable reasonable and fair-minded people to reach the verdict under review.” Hooper v. Smallwood, 270 S.W.3d 234, 240 (Tex. App.—Texarkana 2008, pet. denied) (citing City of Keller v. Wilson, 168 S.W.3d 802, 827 (Tex. 2005)). In making this determination, we credit favorable evidence that could be found by a reasonable juror and disregard contrary evidence unless a reasonable juror could not. Id. As long as the evidence falls within the zone of reasonable disagreement, we will not substitute our judgment for that of the juror. Id. Although we consider the evidence in a light most favorable to the challenged findings, indulging every reasonable inference that supports them, we will not disregard evidence that allows only one inference. Id.
Since the Walker Group attacked the factual sufficiency of the jury’s verdict, based upon its failure to find WAC substantially performed under the contract as alleged in its amended petition, they must now demonstrate that the adverse finding was against the great weight and preponderance of the evidence. Id. (citing Dow Chem. Co. v. Francis, 46 S.W.3d 237, 242 (Tex. 2001); In re Estate of Steed, 152 S.W.3d 797, 806 (Tex. App.—Texarkana 2004, pet. denied)). In conducting our review of this issue, we consider and weigh all of the evidence and set aside a verdict only if the evidence is so weak or if the finding is so against the great weight and preponderance of the evidence that it is clearly wrong and unjust. Id. (citing Pool v. Ford Motor Co., 715 S.W.2d 629, 635 (Tex. 1986); Steed, 152 S.W.3d at 806). We also keep in mind that the jury was the sole judge of the credibility of the witnesses and the weight to be given their testimony. Id. (citing Golden Eagle Archery, Inc. v. Jackson, 116 S.W.3d 757, 761 (Tex. 2003)).
The jury found that WAC failed to comply with the construction agreement, while Roberts did comply. The contract simply provided that Roberts would pay the lump sum price of $57,250.00 to WAC “to construct a 7/8 mile Horse Track . . . as per [Roberts’] instructions.” It is undisputed that WAC did not complete the racetrack and that Walker ordered the Thackers to abandon the job. This would enable a reasonable and fair-minded jury to reach the conclusion that WAC breached the agreement. The primary dispute of the parties was the requirement of three feet of clay as a base. This issue was contested and a fact issue was presented to the jury, which it resolved in Roberts’ favor. Combined with the wording of the contract implying payment conditioned upon performance per Roberts’ instructions, and evidence tending to show three feet of clay was required, we conclude the evidence was not so weak or the finding so against the great weight and preponderance of the evidence that it was clearly wrong and unjust.
The Walker Group also argued the evidence was insufficient to support the jury finding that WAC did not substantially perform the contract. At best, Walker stated he believed fifty percent of the work was completed. This testimony was countered by Roberts’ and Richey’s testimony explaining that the track was under grade when left and that the track had to be re-tilled since Walker tilled the vegetation into the soil. Roberts also testified that it took a substantial amount of time and money to complete the project. Again, uncontroverted evidence established the Walker Group walked out on the job, supporting a finding that they did not intend to comply with the contract in good faith. We conclude the evidence was legally and factually sufficient to sustain the jury’s finding that WAC did not substantially perform the contract.[16]
V. The Trial Court Did Not Err in Denying Walker’s Requested Jury Instruction
An instruction is proper if it might assist the jury in answering the submitted questions, accurately states the law, and finds support in the pleadings and evidence. Tex. R. Civ. P. 277; Elbaor v. Smith, 845 S.W.2d 240, 243 (Tex. 1992); Wal-Mart Stores, Inc. v. Middleton, 982 S.W.2d 468, 470 (Tex. App.—San Antonio 1998, pet. denied); La. & Ark. Ry. Co. v. Blakely, 773 S.W.2d 595, 598 (Tex. App.—Texarkana 1989, writ denied). A trial court is afforded more discretion when submitting instructions than when submitting questions. Middleton, 982 S.W.2d at 470. Since the trial court has considerable discretion to determine necessary and proper jury instructions, we review a trial court’s decision to refuse a particular instruction under an abuse of discretion standard. Shupe v. Lingafelter, 192 S.W.3d 577, 579 (Tex. 2006); In re V.L.K., 24 S.W.3d 338, 341 (Tex. 2000); La. & Ark. Ry., 773 S.W.2d at 598. An abuse of discretion occurs where a trial court acts arbitrarily, unreasonably, without consideration of guiding principles, or clearly fails to analyze or apply the law correctly. Middleton, 982 S.W.2d at 469; Walker v. Packer, 827 S.W.2d 833, 840 (Tex. 1992); Downer, 701 S.W.2d at 241–42. When a trial court refuses to submit a requested instruction on an issue raised by the pleadings and evidence, we first determine if the instruction was reasonably necessary to enable the jury to render a proper verdict. Shupe, 192 S.W.3d at 579; Tex. Workers’ Comp. Ins. Fund v. Mandlbauer, 34 S.W.3d 909, 912 (Tex. 2000) (referring to Texas Rules of Civil Procedure 277 and 278).
WAC asked the trial court to submit the following instruction along with the breach of contract question: “The Court has determined that the contract between the parties does not require Walker & Associates Construction to include a clay base three feet deep in constructing the horse track.” In submitting the issue of breach to the jury, the trial court impliedly found that the issue of whether three feet of clay was necessary was a disputed fact and therefore required a jury determination. As written, the instruction would not assist the jury, but would be a determination as a matter of law on a disputed fact question. We conclude the trial court did not abuse its discretion in denying the proposed instruction.
VI. The Trial Court Did Not Err in Awarding Damages Based on Quantum Meruit
The jury found that the value of WAC’s compensable work was $13,200.00, and the trial court granted WAC a judgment against Roberts in that amount. “As a general rule, a plaintiff who seeks to recover the reasonable value of services rendered or materials supplied will be permitted to recover in quantum meruit only when there is no express contract covering those services or materials.” Truly v. Austin, 744 S.W.2d 934, 936 (Tex. 1988). There are two exceptions to the general rule. The first applies where a party partially performs a contract, but was prevented from completing the contract due to the other party’s breach. Id. This fact situation does not exist here. Another exception exists when a plaintiff partially performs a unilateral contract. Id. at 937. In dicta, Truly stated that Texas courts have allowed a breaching contractor to recover under quantum meruit where the owner has accepted and retained some benefit as a result of a contractor’s partial performance. Id. (citing City of Sherman v. Connor, 88 Tex. 35, 29 S.W. 1053 (1895); City of Ingleside v. Stewart, 554 S.W.2d 939, 947 (Tex. Civ. App.—Corpus Christi 1977, writ ref’d n.r.e.)).
Roberts urges this Court to follow the general rule. However, another Texas Supreme Court decision reiterates the dicta in Truly in holding that a breaching contractor can recover under quantum meruit even where there was no substantial performance under contract. Murray v. Crest Constr., Inc., 900 S.W.2d 342, 345 (Tex. 1995) (stating construction contracts exception to general rule); Dobbins v. Redden, 785 S.W.2d 377, 378 (Tex. 1990); 10 Tex. Jur. 3d Building Contracts § 56 (2003); Comm. on Pattern Jury Charges, State Bar of Tex., Texas Pattern Jury Charges: Business Consumer Insurance Employment PJC 101.42, 101.46 (2008). But see R.M.Dudley Constr. Co. v. Dawson, 258 S.W.3d 694, 703 (Tex. App.—Waco 2008, pet. denied) (applying general rule in upholding trial court’s denial of recovery under quantum meruit theory). Thus, quantum meruit was available to the Walker Group.
“To recover on a claim for quantum meruit, appellant must show (1) he rendered valuable services, (2) for appellees, (3) they accepted his services, and (4) he rendered the services under circumstances as would reasonably notify them that he expected to be paid.” Johnson v. Kruse, 261 S.W.3d 895, 901 (Tex. App.—Dallas 2008, no pet.); Tully v. Citibank (South Dakota), N.A., 173 S.W.3d 212, 216 (Tex. App.—Texarkana 2005, no pet.). This was done. The jury found that WAC performed compensable work that Roberts knowingly accepted while also knowing that WAC expected payment.
In arguing that an additional finding of unjust enrichment is necessary, Roberts quotes Truly as follows: “to justify a recovery in quantum meruit, the plaintiff . . . must also show that the defendant has been unjustly enriched and the plaintiff would be unjustly penalized if the defendant were permitted to retain the benefits of the partial performance without paying anything in return.” Truly, 744 S.W.2d at 938; Dawson, 258 S.W.3d at 702. Based on this quote in Truly, Roberts argues that since findings of unjust enrichment were not included in the jury questions, the trial court erred in making the award. In Truly, the Texas Supreme Court held that the general rule applied—a party may not recover under quantum meruit when there is an express contract on the matter. The further discussion concerning the exception to the general rule for construction cases, including the above quote, was dicta since Truly did not involve a claim for construction completed, but was a claim for services rendered to a joint venture. Truly, 744 S.W.2d at 936.
The measure of damages for a quantum meruit claim is the reasonable value of the work performed. Johnson, 261 S.W.3d at 902 (citing Lamajak, Inc. v. Frazin, 230 S.W.3d 786, 796 (Tex. App.—Dallas 2007, no pet.)). The Texas Pattern Jury Charges, upon which the trial court’s charge was based, indicate that the measure of damages for quantum meruit is not different in construction contracts. Comm. on Pattern Jury Charges, State Bar of Tex., Texas Pattern Jury Charges: Business Consumer Insurance Employment PJC 101.46, 115.6 (2008). Well-settled pattern jury charges should not be embellished with addendum. Weeks Marine, Inc. v. Salinas, 225 S.W.3d 311, 319 (Tex. App.—San Antonio 2007, pet. dism’d). What constitutes a reasonable compensation for benefits furnished does not depend on any single factor, but takes into account all the evidence and circumstances. See 64 Tex. Jur. 3d Restitution Etc. § 34 (2009).
The more recent Texas Supreme Court opinion in Murray specifically authorized a recovery on the theory of quantum meruit based on jury questions that were precisely the same as in this case. Murray v. Crest Constr., Inc., 900 S.W.2d 342 (Tex. 1995). The jury question was: “Did Murray perform compensable work for Crest on the Borden and Cooper Jobs?” Crest Constr. v. Murray, 888 S.W.2d 931, 952 (Tex. App.—Beaumont 1994), rev’d, 900 S.W.2d 342 (Tex. 1995). The definition of compensable work is exactly the same as the jury instruction here. Id. The appellate court recognized “this is a submission on the quantum meruit theory of recovery,” but held quantum meruit was unavailable because an express contract covered services provided by Murray, and the contract price was stipulated. Id. The Texas Supreme Court reversed, and based on those jury findings, held:
Generally, a party may not recover under quantum meruit when there is an express contract covering the services or materials furnished. [citing Truly] Construction contracts are an exception to this rule. It is undisputed that Murray has failed to substantially perform the Borden and Cooper jobs, a condition precedent to recovery under the express contract. Murray may bring an action in quantum meruit to recover the amount of benefits conferred by its partial performance on to Crest.
Murray, 900 S.W.2d at 345. Importantly, the Texas Supreme Court did not require any further finding of unjust enrichment in Murray. We believe Murray provides the authority for a recovery in quantum meruit in this case.
Roberts cites our language in Box v. Au Forgeron de la Court-Dieu, Inc., stating:
Recovery in quantum meruit, when the work has not been done in a good and workmanlike manner, is limited to the market value of the work as done less the cost of remedying the defects.
708 S.W.2d 538, 541 (Tex. App.—Texarkana 1986, writ ref’d n.r.e) (citations omitted). Box involved a case in which the jury expressly determined that the work was not done in a good and workmanlike manner. Because no such finding was submitted to the jury in this case, and we do not assume such a finding given the jury’s belief that Walker performed compensable work, Box is inapplicable.
VII. The Trial Court Did Not Err in Refusing to Award Walker Construction Eighteen Percent Interest
If an owner . . . receives a written payment request from a contractor for an amount that is allowed to the contractor under the contract for properly performed work . . . the owner shall pay the amount to the contractor . . . not later than the 35th day after the date the owner receives the request.
Tex. Prop. Code Ann. § 28.002 (Vernon 2000). “An unpaid amount required under this chapter begins to accrue interest on the day after the date on which the payment becomes due . . . An unpaid amount bears interest at the rate of 1 1/2 percent each month.” Tex. Prop. Code Ann. § 28.004 (Vernon 2000). WAC relies on the Prompt Payment Act to suggest that eighteen percent prejudgment and post-judgment interest should have been awarded on its unjust enrichment recovery. Tex. Prop. Code Ann. §§ 28.002, 28.004.
“As a prerequisite to presenting a complaint for appellate review, the record must show that: (1) the complaint was made to the trial court by a timely request, objection, or motion.” Tex. R. App. P. 33.1. Judicial economy requires that a trial court have the opportunity to correct an error before an appeal proceeds. In re C.O.S., 988 S.W.2d 760, 765 (Tex. 1999). A motion for new trial, motion to modify or limit judgment, or exception to the judgment provides the trial court with such an opportunity. Gerdes v. Kennamer, 155 S.W.3d 523, 532 (Tex. App.—Corpus Christi 2004, pet. denied); William S. Baker, Inc. v. Sims, 589 S.W.2d 492, 493 (Tex. Civ. App.—Dallas 1979, writ ref’d n.r.e.).
Here, the Walker Group did not apprise the trial court of its complaint requesting eighteen percent interest in the motion for new trial. It also failed to file a motion to amend or modify judgment, or otherwise inform the trial court of the complaints. See Hyde-Way, Inc. v. Davis, No. 2-08-313-CV, 2009 WL 2462438, at *10 (Tex. App.—Fort Worth Aug. 13, 2009, no pet.) (mem. op.). Thus, the Walker Group has waived this point of error on appeal. Bushell v. Dean, 803 S.W.2d 711, 712 (Tex. 1991).[17]
VIII. Conclusion
We affirm the portion of the trial court’s summary judgment finding interest charged by WAS usurious under Section 305.003 of the Texas Finance Code. However, we remand the issue of damages and attorney’s fees awarded under this section for further proceedings consistent with our opinion. The trial court’s award of summary judgment with respect to fraudulent lien claims and associated attorney’s fees is reversed and remanded. Claims made under Section 305.004 of the Texas Finance Code, and their associated attorney’s fee awards are reversed and judgment is rendered that Roberts take nothing on that claim. Otherwise, the judgment is affirmed.
Jack Carter
Justice
Date Submitted: January 13, 2010
Date Decided: February 26, 2010
[1]Originally appealed to the Twelfth Court of Appeals, this case was transferred to this Court by the Texas Supreme Court pursuant to its docket equalization efforts. See Tex. Gov’t Code Ann. § 73.001 (Vernon 2005). We are unaware of any conflict between precedent of the Twelfth Court of Appeals and that of this Court on any relevant issue. See Tex. R. App. P. 41.3.
[2]The survey was done by WAS. There was no separate contract with WAS for the field survey.
[3]Roberts decided to widen the track from thirty feet to forty feet. Although he recognized that part of the work was due to widening of the track not contemplated under WAC’s contract and inclusion of a rail and chute, Roberts testified the total price for the other contractor to complete the track was $85,345.70.
[4]Walker testified the affidavit “should say Walker & Associates Construction.”
[5]WAS had done survey work before this time.
6The record contains a summary judgment granted in WAS’s favor on its suit on sworn account. This summary judgment has no bearing on this Court’s opinion. The trial court set the motion for hearing on January 23, 2008, but WAS asked to cancel the hearing. Nevertheless, the trial court granted WAS’s motion for summary judgment. The summary judgment order stated that WAS had appeared through its attorney of record, while Roberts did not appear. When the miscommunication regarding the hearing date was pointed out to the trial court, the summary judgment was set aside.
[7]The trial court’s attorney’s fees award was based on Roberts’ attorney’s testimony stating he had segregated the fees for the usury and fraudulent liens claims to be only $1,312.50.
[8]A person who violates this section is liable to the obligor in an amount which is the greater of $10,000.00 or the actual damages caused by the violation, along with court costs, reasonable attorney’s fees, and exemplary damages in an amount determined by the court. Tex. Civ. Prac. & Rem. Code Ann. § 12.002(b).
[9]Walker testified it was his normal practice to immediately file a lien and that his office prepared the lien. This evidence suggests Walker may not have had intent to cause Roberts financial harm.
[10]For this issue to reach a jury, Roberts must present some evidence WAS received a usurious interest payment.
[11]The Walker Group complains that the notice sent by Roberts of the usury violation was untimely. We need not address this issue since the Walker Group failed to request an abatement.
[12]As a matter of first impression, our sister court has held that this remedial statute applies retroactively. Bair Chase Prop. Co. v. S & K Dev. Co., 260 S.W.3d 133, 144 (Tex. App.—Austin 2008, pet. denied).
[13]The trial court in Bair Chase Property Company issued an order abating the case for sixty days and required the creditor to pay the debtor $6,000.00 in attorney’s fees. 260 S.W.3d at 137. Because the creditor paid the attorney’s fees and sent a corrective action letter to the debtor, the court determined the violation of the usury statute was cured. Id.
[14]The Walker Group also questions "[w]hether the charge was due to a mistake or accident is a . . . genuine issue of material fact." No evidence raising the issue of mistake or accident is provided in the record, and we need not address this contention.
[15]The Walker Group cites this Court to First Bank v. Tony’s Tortilla Factory, Inc., for the proposition that late fees are not usurious interest. In First Bank, the court held that an insufficient fund fee was not interest because it was a service charge constituting separate and additional consideration, other than the lending of money, for processing each bad check. Id. at 287. In other words, the Bank’s consideration was not lending money, but rather, advancing funds to cover the bad check. Id. at 288. In its opinion, First Bank cited several cases holding that attorney’s fees, commitment fees, prepayment penalties, and brokerage fees were also not considered usurious interest. Tex. Commerce Bank v. Goldring, 665 S.W.2d 103, 104 (Tex. 1984); Stedman v. Georgetown Sav. & Loan Ass’n, 595 S.W.2d 486, 489 (Tex. 1979); Bearden v. Tarrant Sav. Ass'n, 643 S.W.2d 247, 249 (Tex. App.—Fort Worth 1982, writ ref’d n.r.e.); Morris v. Miglicco, 468 S.W.2d 517, 519 (Tex. Civ. App.—Houston [14th Dist.] 1971, writ ref’d n.r.e.). These cases holding fees did not constitute interest are distinguishable from this case because the fees in those cases were “bona fide fees paid to third parties for servicing late payments” or were contracted for. Perry v. Stewart Title Co., 756 F.2d 1197, 1207 (5th Cir. 1985); Goldring, 665 S.W.2d at 104; Stedman, 595 S.W.2d at 489; Bearden, 643 S.W.2d at 248–49; Morris, 468 S.W.2d at 519.
[16]Also, the above-recited evidence can be used to conclude it was sufficient for the jury to find Walker’s nonperformance was not excused by some nonperformance of a material obligation or repudiation by Roberts.
[17]Moreover, the Prompt Payment Act applies only when an obligor under a contract fails to pay timely in the absence of a good faith dispute.
Document Info
Docket Number： 06-09-00147-CR
Filed Date： 4/23/2010
Precedential Status： Precedential
Modified Date： 4/17/2021