Main Street Schools, L.L.C. D/B/A Montessori Country Day School and William J. Vesterman v. Jason and Lori Bimmerle ( 2015 )

COURT OF APPEALS
SECOND DISTRICT OF TEXAS
FORT WORTH
NO. 02-12-00471-CV
MAIN STREET SCHOOLS, L.L.C. APPELLANTS
D/B/A MONTESSORI COUNTRY
DAY SCHOOL AND WILLIAM J.
VESTERMAN
V.
JASON AND LORI BIMMERLE APPELLEES
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FROM COUNTY COURT AT LAW NO. 2 OF DENTON COUNTY
TRIAL COURT NO. CV-2012-00879
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MEMORANDUM OPINION1
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I. Introduction
From 2008 to 2011, appellees Jason and Lori Bimmerle paid appellants
Main Street Schools, L.L.C. d/b/a Montessori Country Day School and William J.
1
See Tex. R. App. P. 47.4.
Vesterman (collectively, Main Street) for their son’s education. The Bimmerles
prevailed in the justice court and then the county court at law in a trial de novo in
their subsequent lawsuit against Main Street to seek a refund of their advance
tuition payment for the 2011–2012 school year. The county court used
rescission to prevent unjust enrichment as a basis to refund half of the
Bimmerles’ advance tuition payment, and Main Street appealed, raising three
issues. We reverse the county court’s judgment and render judgment for Main
Street.
II. Discussion
Main Street argues that the county court erred by (1) denying its motion for
judgment on the Bimmerles’ breach-of-contract claim at the close of the
Bimmerles’ case; (2) awarding a remedy to the Bimmerles that was unsupported
by any legal claim that could support it; and (3) rescinding a valid contract and
awarding damages to the Bimmerles under an unjust enrichment theory that was
not pleaded, proven, or addressed by either party during trial.
A. Standard of Review and Applicable Law
The trial court made findings of fact and conclusions of law. A trial court’s
findings of fact have the same force and dignity as a jury’s answers to jury
questions and are reviewable for sufficiency of the evidence to support them by
the same standards. Catalina v. Blasdel, 881 S.W.2d 295, 297 (Tex. 1994);
Anderson v. City of Seven Points, 806 S.W.2d 791, 794 (Tex. 1991); see also
MBM Fin. Corp. v. Woodlands Operating Co., 292 S.W.3d 660, 663 n.3 (Tex.
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2009). We may review conclusions of law to determine their correctness based
upon the facts, but we will not reverse because of an erroneous conclusion if the
trial court rendered the proper judgment. City of Austin v. Whittington, 384
S.W.3d 766, 779 n.10 (Tex. 2012) (citing BMC Software Belgium, N.V. v.
Marchand, 83 S.W.3d 789, 794 (Tex. 2002)); H.E.B., L.L.C. v. Ardinger, 369
S.W.3d 496, 513 (Tex. App.—Fort Worth 2012, no pet.).
We may sustain a legal sufficiency challenge only when (1) the record
discloses a complete absence of evidence of a vital fact; (2) the court is barred
by rules of law or of evidence from giving weight to the only evidence offered to
prove a vital fact; (3) the evidence offered to prove a vital fact is no more than a
mere scintilla; or (4) the evidence establishes conclusively the opposite of a vital
fact. Uniroyal Goodrich Tire Co. v. Martinez, 977 S.W.2d 328, 334 (Tex. 1998),
cert. denied, 526 U.S. 1040 (1999); Robert W. Calvert, “No Evidence” and
“Insufficient Evidence” Points of Error, 38 Tex. L. Rev. 361, 362–63 (1960). In
determining whether there is legally sufficient evidence to support the finding
under review, we must consider evidence favorable to the finding if a reasonable
factfinder could and disregard evidence contrary to the finding unless a
reasonable factfinder could not. Cent. Ready Mix Concrete Co. v. Islas, 228
S.W.3d 649, 651 (Tex. 2007); City of Keller v. Wilson, 168 S.W.3d 802, 807, 827
(Tex. 2005).
During trial, the Bimmerles stated that their cause of action was for breach
of contract, and the trial court agreed that it was a breach-of-contract case,
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stating, “I don’t think there is any other way to construe this.” The Bimmerles
stated that their claim was either for “our oral contract for the payment of tuition
and the receipt of education for [the child], or it is a . . . repeated promise to get
the money and pay it back with interest.”2
The requirements of a valid contract are: (1) an offer; (2) an acceptance in
strict compliance with the offer’s terms; (3) a meeting of the minds; (4) each
party’s consent to the terms; (5) consideration; and (6) execution and delivery of
the contract with the intent that it be mutual and binding. Hubbard v. Shankle,
138 S.W.3d 474, 481 (Tex. App.—Fort Worth 2004, pet. denied). The elements
of written and oral contracts are the same and must be present for a contract to
be binding. Id. The essential elements of a breach of contract claim are (1) a
valid contract, (2) performance or tendered performance by the plaintiff, (3)
breach of the contract by the defendant, and (4) damages to the plaintiff resulting
from the breach. Inova Renovations, L.L.C. v. Jones, No. 02-13-00397-CV, 2014
WL 7204497, at *2 (Tex. App.—Fort Worth Dec. 18, 2014, no pet.) (mem. op.).
B. Evidence
Lori Bimmerle testified that she and her husband enrolled their child with
Main Street in the 2008–2009 school year when the child was three years old
and that he completed two years of prekindergarten and kindergarten at the
2
At the trial’s conclusion, the Bimmerles also argued that if the original
2008 contract applied, then Main Street breached it because it did “not giv[e]
back everything beyond what would be considered the deposit amount,” but they
do not elaborate upon that argument in their brief.
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school. The 2011–2012 school year would have been their son’s first grade
year.
Lori stated that she paid tuition month-to-month during her son’s first and
second years at the school but then prepaid during his kindergarten year
because the school offered a tuition discount for paying in full. She paid the
school $6,296, the amount for the full year with a discount, for her child’s first
grade year. Only after she had made the advance tuition payment did Lori
decide that the child would not go into first grade at the school.3
The parties’ August 11, 2008 contract contains the following portions
relevant to the issues on appeal:
Agreement
The following statements conform to the Texas Childcare laws
governing all childcare facilities. In signing this form, [] a parent or
guardian, we hereby agree to school policies and conditions as
follows:
....
7. The school agrees to present the Montessori program
suitable to the child. No guarantee is made regarding achievement,
social adjustment, or speed of progress.
8. It is understood that once application is made, registration
and materials fees are not refundable. The tuition deposit is
refundable only when the child is not accepted.
3
Lori said that the child’s behavioral issues in the classroom during
kindergarten and the school’s reaction led to the Bimmerles’ decision not to send
the child there for first grade and to ask for a refund of the advance tuition
payment. Lori said that when she asked for a refund of her advance tuition
payment, Main Street told her that “[t]hey would work on it.” Lori followed up on
that statement by phone and e-mail before sending a demand letter.
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9. The ideal Montessori program begins at around age three
and continues through age six or seven; therefore, parents should
keep this in mind when they make a decision to bring a child here.
When application is accepted, enrollment is for the full term. The
family who enrolls a child hereby understands and agrees that tuition
refunds or allowances will not be made for absence from school due
to illness or other circumstances. The family further understands
and agrees that no adjustment or refund of fees or tuition, including
the May advance tuition and enrollment and material fees, will be
made if a child is withdrawn from school by the parent for any reason
before the end of the period for which he has been enrolled.
10. The school reserves the absolute right to dismiss a
student if family is unable to follow the policies of the school or
practice the principals of Dr. Montessori; under these circumstances,
and only these circumstances, -partial prorated tuition will be
refunded.
11. The Elementary school, made up of Kindergarteners and
First Graders, is reserved for those children who have extensive
experience in the Montessori environment, who have attended at
least one semester of five full days a week, and who stay here for
the First Grade. Kindergarteners who do not plan to be with us
through the First Grade will remain in the Preschool.
....
13. Parents agree that they understand the school’s program
and that this contract represents the full agreement between them,
and that it shall not be modified or amended in any fashion except
by written instrument to such effect signed and agreed to by both
Parties and attached to this contract.
Vesterman, the school’s owner, testified that the agreement’s purpose was
to run the school properly so that Main Street could educate children properly
and that parents sign the agreement in order to enroll their children in the school.
Bimmerles’ counsel then asked Vesterman, “And your promise to the Bimmerles
was to educate [the child] . . . in exchange for tuition? For them to pay you to
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educate [him]?” Vesterman replied, “Yes. And we did that.” Vesterman testified
that the 2008 agreement was the entire agreement between the parties “[u]nless
something were signed and attached to it.”
Vesterman further testified that when a family enrolls a child at the school,
they are given options on payment and tuition. He stated that if a parent were to
enroll a child in the first grade, the parent would sign an agreement and other
enrollment documents, pay a $200 registration fee, pay a $300 materials fee, and
make a tuition deposit. The amount of the deposit would depend on how the
parent chose to pay—monthly (one month’s tuition as a deposit) or annually (full-
year tuition with an 8% discount). Vesterman testified that the 8% discount was
offered as an incentive for parents to pay the full year. The Bimmerles took this
incentive and paid a full year’s tuition in exchange for the 8% discount instead of
paying month-to-month with no discount.
Although the Bimmerles’ son did not attend first grade at the school, there
is no evidence that either party breached the contract. Vesterman stated that he
did not ask the Bimmerles’ child to leave the school, and Lori testified that when
she told him that the child would not be attending first grade at the school, she
was told that the child was welcome back at the school. The Bimmerles paid the
contract price in full and the school agreed and remained ready to perform the
service of educating the Bimmerles’ son.4 Indeed, the trial court made no finding
4
The gravamen of the Bimmerles’ claim, as set forth in their original
petition, appears to be that after the Bimmerles had paid the advance tuition and
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of fact or conclusion of law that a breach of the agreement occurred by either
party.
C. Analysis
In its conclusions of law, the trial court stated that the August 11, 2008
contract was for the 2008–2009 school year and that another contract was
formed when the Bimmerles made the 2011–2012 tuition payment in April 2011.5
While we may disagree with the trial court’s conclusion of law as to the
creation of a new contract between the parties,6 whether a new contract was
subsequently decided not to enroll their son, they demanded the return of the
advance tuition since their son “would not be attending [Main Street’s] school the
following year as initially anticipated,” and Main Street refused to return the
tuition deposit. And while the trial court admitted into evidence e-mail messages
exchanged between Lori and Vesterman regarding a tuition refund, the record
does not reflect that any of these messages led to a writing agreed to and signed
by the parties and attached to the August 11, 2008 contract. Lori Bimmerle
stated in one of her e-mail messages that she wanted a contract in place to
formalize Vesterman’s assertion that Main Street would refund the tuition, but
there is nothing in the record to show that any such contract was ever created.
5
In its third conclusion of law, the trial court found that this subsequent
contract “obligated Defendants to enroll Plaintiffs’ minor child and educate him for
the 2011-2012 school year.”
6
The record reflects that the Bimmerles made the advance tuition payment
in April 2011 for their son’s first grade year pursuant to the terms of the August
11, 2008 contract. Lori’s testimony shows that the Bimmerles were following the
“ideal Montessori program” set out in paragraph 9 in the 2008 contract when they
enrolled their child at age three and that they had been planning to take
advantage of the provision in paragraph 11 that restricted elementary school
(kindergarten and first grade) availability to only those students who had
attended at least one semester of five full days a week and who stayed for the
first grade. The Bimmerles’ full-year advance payment of $6,296 reserved their
child’s place in the first grade class, as set out in paragraphs 9 and 11 of the
August 11, 2008 contract. The August 11, 2008 contract also contains other
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formed when the 2011–2012 tuition payment was made is immaterial because
there is no evidence of any breach of this agreement either by the school or the
Bimmerles. Nor was there any finding or conclusion by the trial court that any
such breach occurred. Nevertheless, the trial court determined that the
Bimmerles were entitled to a refund of half of their advance tuition payment
($3,129.84), relying on its theory that a new contract had been created with the
April 2011 tuition payment and on the doctrine of rescission and unjust
enrichment.
Although the trial court equivocated at the conclusion of trial with regard to
the application of equity and rescission to prevent unjust enrichment, 7 rescission
would not have been the appropriate remedy here. We have previously stated,
Rescission is an equitable remedy that seeks to set aside an
otherwise legal contract due to fraud, mistake, or for some other
reason when it is necessary to avoid unjust enrichment of the non[-]
complaining party to the contract, so that the parties thereto may be
restored, insofar as is possible, to the status or position they were in
prior to execution of the contract. Rescission is thus an “undoing” of
the contract and generally used as a substitute for monetary
damages when such damages would not be adequate.
essential terms governing the parties’ relationship that are not demonstrated
elsewhere in the record or in the alleged separate April 2011 tuition agreement
proposed by the Bimmerles and found by the trial court. These terms included
the requirements to modify or amend the 2008 agreement and the circumstances
under which parents could receive a tuition refund.
7
The trial judge stated that he believed that the pleadings pointed to an
attempt of rescission and that this “allows the Court to act in a manner in which it
can deal with principles of equity. And specifically the principle of unjust
enrichment.”
9
City of The Colony v. N. Tex. Mun. Water Dist., 272 S.W.3d 699, 732 (Tex.
App.—Fort Worth 2008, pet. dism’d) (emphasis added) (citations omitted). And,
as the supreme court has explained, because rescission is an equitable remedy,
“fault is relevant.” Cruz v. Andrews Restoration, Inc., 364 S.W.3d 817, 826 (Tex.
2012); see Kennebrew v. Harris, 425 S.W.3d 588, 595 (Tex. App.—Houston
[14th Dist.] 2014, pet. denied) (“Because rescission is a remedy, it is available
only if the other party to the contract has committed some wrong.”).
The only claim presented by the Bimmerles was for breach of contract;
they made no allegations of fraud or mistake. Likewise, the trial court did not find
fraud or mistake, and there is no evidence to support any such finding.8 Indeed,
there is no evidence in the record before us of any wrongdoing by Main Street
that would support recovery by rescission under the terms of either the 2008
contract or the purported 2011 contract. See George P. Roach, Rescission in
Texas: A Suspect Remedy, 31 Rev. Litig. 493, 568 (2012) (“Texas courts are
generally opposed to equitable remedies for breaches of contract, and rescission
8
Although the Bimmerles attempted to argue, and the trial court made a
conclusion based on, disparate treatment as compared to parents who paid
month-to-month with regard to tuition refunds, the Bimmerles’ advance tuition
payment enrolled their child for the 2011–2012 school year and provided them
with an 8% discount that parents who paid month-to-month did not receive, and
there is no indication that the Bimmerles are members of a protected class. See
Ian Ayres, Market Power and Inequality: A Competitive Conduct Standard for
Assessing When Disparate Impacts Are Unjustified, 95 Calif. L. Rev. 669, 678
(2007) (observing that an airline with market power on a particular route may
charge business travelers higher fares than tourists because business travelers
have a less elastic demand for air travel and hence are willing to pay more).
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is rare.”); see also Damstra v Starr, 585 S.W.2d 817, 820 (Tex. Civ. App.—
Texarkana 1979, no writ) (“A person cannot rescind a contract merely because,
in the light of subsequent developments, a provision thereof operated to his
disadvantage.”); Chenault v. Shelby Cnty., 320 S.W.2d 431, 433 (Tex. Civ.
App.—Austin 1959, writ ref’d n.r.e.) (observing that “a party cannot avoid his
contract on the ground that he received less in value than he supposed, or that
what he has received has no value at all unless he shows additional facts
entitling him to equitable relief such as fraud or mistake”); cf. Houston v. Ludwick,
No. 14-09-00600-CV, 2010 WL 4132215, at *3, *12 (Tex. App.—Houston [14th
Dist.] Oct. 21, 2010, pet. denied) (mem. op.) (affirming judgment on breach of
fiduciary duty and unjust enrichment claims that included rescission of deeds
conveying two condominium units). Therefore, rescission was not available as a
remedy, whether pleaded or unpleaded. We sustain Main Street’s three issues.
III. Conclusion
Having sustained all of Main Street’s issues, we reverse the trial court’s
judgment and render a take-nothing judgment for Main Street.
/s/ Bonnie Sudderth
BONNIE SUDDERTH
JUSTICE
PANEL: LIVINGSTON, C.J.; WALKER AND SUDDERTH, JJ.
DELIVERED: June 4, 2015
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