Dr. Gregory Milligan, M.D. and Chellse Gazda, M.D. v. Amber Mayhew, Keith Mayhew, and SSF Consulting LLC DBA Nanny Poppinz ( 2023 )

AFFIRMED and Opinion Filed July 14, 2023
S In The
Court of Appeals
Fifth District of Texas at Dallas
No. 05-22-00675-CV
DR. GREGORY MILLIGAN, M.D. AND CHELLSE GAZDA, M.D.,
Appellants
V.
AMBER MAYHEW, KEITH MAYHEW, AND SSF CONSULTING, LLC
D/B/A NANNY POPPINZ, Appellees
On Appeal from the 116th Judicial District Court
Dallas County, Texas
Trial Court Cause No. DC-21-05362
MEMORANDUM OPINION
Before Justices Nowell, Goldstein, and Breedlove
Opinion by Justice Nowell
Dr. Gregory Milligan and Dr. Chellse Gazda sued Amber Mayhew, Keith
Mayhew, and SSF Consulting, LLC d/b/a Nanny Poppinz for breach of contract and
violations of the Deceptive Trade Practices Act (DTPA). Following a bench trial,
the trial court entered findings of fact and conclusions of law and a take-nothing
judgment against appellants.
Appellants raise two issues on appeal. They argue the trial court erred by not
entering a default judgment against SSF Consulting, LLC d/b/a Nanny Poppinz
because it did not file a proper answer and did not appear at trial. In their second
issue, appellants argue the trial court incorrectly interpreted the contract, and the
evidence is legally and factually sufficient to establish their breach of contract and
DTPA claims. We affirm the trial court’s take-nothing judgment.
Background
Appellees own a nanny referral service called Nanny Poppinz. Nanny
Poppinz’s website advertised it “does not charge a fee of any kind until we provide
you with the Nanny of your choice. Then and only then is payment due to Nanny
Poppinz. So let us help you with your child care and we promise your satisfaction.
Call us now.”
Appellants contacted Nanny Poppinz about nanny services for their child. On
October 4, 2020, appellees responded via email and included a welcome letter
explaining their services and pricing. Appellants signed Nanny Poppinz’s standard
form contract promulgated by Nannies of America, Inc. (NAI), which included the
following provision:
Client shall pay Company the following upon Client’s employment or
other engagement of a candidate when the candidate accepts the
position and in all cases prior to the candidate reporting for work with
Client . . . (c) For each full-time candidate: 10% of the candidate’s total
annual gross compensation, or a minimum $2,000, whichever is
greater.
Gazda provided appellees a credit card number for future payment.
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Appellees provided potential applicant files, and appellants interviewed Kim
Powers on November 9, 2020. Powers turned down appellants’ original offer;
however, they reached back out to her in late November, and she reconsidered.
Powers sent an email informing appellants of her efforts to create a budget, locate
an apartment, and obtain insurance. In a separate email, Powers indicated she could
start on December 14. On November 30, 2020, Milligan told Powers her annual
income would be “just over $54k.” He asked Amber to confirm the amount for the
referral fee, and she told him that based on ten percent of Powers’ first year gross
annual salary, the referral fee would be $5,408.00.
On December 2, 2020, Milligan told Powers they “authorized the referral fee
charge with Amber and will notify the other agencies we were working with that we
are no longer looking for a candidate.” He confirmed her December 14 start date.
Appellees sent a final packet to appellants with a sample contract for them to
finalize with Powers and information regarding payroll services. When Powers
asked further questions about the process and indicated she did not trust Amber,
Milligan reassured her, “I think we’re done with Amber which is nice. My
understanding is that she only wanted our referral fee and is now out of the picture. . .
The contract will be filled out by us and reviewed/edited as needed by you before
we sign.” Powers said there was no rush on the contract, and she would be in town
soon to finalize housing.
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Powers ultimately decided not to work for appellants. Milligan expressed his
confusion and told Powers, “To be clear, we authorized the 10% referral fee of
$5,600 [sic] to Nanny Poppinz in good faith that we came to an agreement with you.”
Appellants requested a refund from appellees, but they refused based on the
contract’s no refund policy. Appellees provided the files of potential replacement
nannies, but appellants refused to interview them.
Appellants filed suit for breach of contract, negligent misrepresentation/gross
negligent misrepresentation, and violations of the DTPA. Appellees filed a pro se
answer arguing, among other things, that they satisfied their obligations under the
contract; therefore, appellants were not entitled to a refund or any other damages.
The case proceeded to a bench trial and appellees appeared pro se.
During the bench trial, Gazda testified she read and signed Nanny Poppinz’s
form contract and provided a credit card for future payment. She admitted she told
Amber they had settled terms with Powers and authorized the $5,408.00 charge.
Gazda, however, denied hiring Powers or signing a contract for her employment.
Amber testified appellants “engaged” Powers because Powers and appellants
confirmed and agreed to an offered salary, which was further supported by
appellants asking her to charge the referral fee.
The trial court found in favor of appellees and entered findings of fact and
conclusions of law supporting the take-nothing judgment. Appellants filed a motion
to modify the judgment asking the trial court to grant a default judgment against SSF
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Consulting, LLC d/b/a Nanny Poppinz because it did not appear at trial. They further
argued the evidence did not support the trial court’s judgment because they never
“employed” or “engaged” Powers per the contract. The trial court denied the motion,
and appellants appealed.
Default Judgment
In their first issue, appellants argue the trial court erred by not entering a
default judgment against SSF Consulting, LLC because it was not represented by
counsel and defaulted. Appellants rely on two established legal propositions: (1) a
non-attorney may not appear for a limited liability company, (2) and when a
defendant files an answer but does not appear at trial, the court may enter a default
judgment. See TEX. R. CIV. P. 239; see also J&A Coating, LLC v. PPG Indus., Inc.,
No. 05-20-00382-CV, 2021 WL 972899, at *2 (Tex. App.—Dallas Mar. 16, 2021,
no pet.) (mem. op.). We disagree with both arguments.
When considering answers filed by non-attorney corporate officers, appellate
courts have “gone to great lengths to excuse defects in answers to prevent the entry
of default judgments against parties who have made some attempt, albeit deficient,
unconventional, or flat out forbidden under the Rules of Civil Procedure, to
acknowledge that they have received notice of the lawsuit pending against them.”
Guadalupe Econ. Servs. Corp. v. Dehoyos, 183 S.W.3d 712, 716 (Tex. App.—
Austin 2005, no pet.) (quoting Hock v. Salaices, 982 S.W.2d 591, 593 (Tex. App.—
San Antonio 1998, no pet.)). Thus, an answer filed on behalf of a corporation by a
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non-attorney is sufficient to prevent a default judgment. KSNG Architects, Inc. v.
Beasley, 109 S.W.3d 894, 899 (Tex. App.—Dallas 2003, no pet.).
Appellees, appearing pro se, filed a letter “From Defendants: Amber Mayhew,
Keith Mayhew, and SSF Consulting, LLC DBA Nanny Poppinz,” in response to “the
papers” served on them. They also signed the letter on behalf of all defendants.
During the bench trial, the court acknowledged the letter was sufficient to prevent a
default judgment against Nanny Poppinz. Accordingly, appellees attempt to answer
the lawsuit, despite doing so as non-lawyers on behalf of the LLC, was sufficient to
excuse any defects and prevent a default judgment.
To the extent appellants argue Nanny Poppinz was not represented at trial,
they ignore the trial court’s finding that Nanny Poppinz forfeited its charter in 2019.
They have not challenged this finding. Unchallenged findings of fact are binding on
the appellate court unless the contrary is established as a matter of law. See George
P. Bane, Inc. v. Ballard, No. 05-19-01459-CV, 2021 WL 1084586, at *4 (Tex.
App.—Dallas Mar. 22, 2021, no pet.) (mem. op.). Appellants have presented no
arguments or pointed to any evidence establishing, as a matter of law, that Nanny
Poppinz’s corporate charter was not forfeited during the time of their dispute. See,
e.g., Johnson v. Dinh, No. 05-19-00127-CV, 2020 WL 3026253, at *3 (Tex. App.—
Dallas June 5, 2020, pet. denied) (mem. op.) (“Any unchallenged findings of fact
that support the judgment will preclude reversal of the case.”).
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Appellants repeatedly acknowledged Nanny Poppinz was not a legal entity.
They stated in their original petition the LLC was no longer in good standing.
Counsel for appellants explained during pretrial discussions that the basis for suing
appellees individually was because the corporate charter did not exist during the
relevant time period. And during trial, appellants asked the trial court to take judicial
notice of a printout from the Texas Secretary of State website indicating the
corporate charter had been revoked at all times material to the suit.
The trial court could not grant a default judgment against a “terminated” legal
entity. See, e.g., Donica Grp., LP v. Thompson Excavating, Inc., No. 05-19-00235-
CV, 2020 WL 57340, at *3 (Tex. App.—Dallas Jan. 6, 2020, no pet.) (mem. op.)
(noting corporate entity that forfeited charter was a “terminated entity” that “no
longer existed” for purposes of defending a default judgment). Accordingly, the trial
court properly denied appellant’s request for a default judgment against Nanny
Poppinz. Appellants’ first issue is overruled.
Breach of Contract and DTPA Violations
In their second issue, appellants contend the trial court erred by granting a
take-nothing judgment on their breach of contract claim because they never
“engaged” or “employed” Powers as their nanny. They maintain the undisputed
evidence establishes Powers never accepted the position, and they never reached an
agreement with her; therefore, they were entitled to a refund of their deposit. They
also argue the trial court erred by denying their DTPA claims because Nanny
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Poppinz’s website included false, misleading, and deceptive statements about the
“no fee” policy.
We apply the same standards of review that apply to a jury’s verdict when
reviewing the sufficiency of the evidence to support the trial court’s findings of fact
and conclusions of law from a bench trial. See MBM Fin. Corp. v. Woodlands
Operating Co., L.P., 292 S.W.3d 660, 663 n.3 (Tex. 2009). When the appellate
record contains a reporter’s record, as in this case, findings of fact are not conclusive
and are binding only if supported by the evidence. Fulgham v. Fischer, 349 S.W.3d
153, 157 (Tex. App.—Dallas 2011, no pet.).
We broadly construe appellants’ brief as challenging both the legal and factual
sufficiency of the evidence. Accordingly, to succeed on their legal sufficiency
challenge, they must demonstrate the evidence conclusively establishes all vital facts
in support of the issue. Dow Chem. Co. v. Francis, 46 S.W.3d 237, 241 (Tex. 2001)
(per curiam). To succeed on their factual sufficiency challenge, appellants must
demonstrate the finding is against the great weight and preponderance of the
evidence. Id. at 242. In a factual sufficiency review, an appellate court considers
and weighs all the evidence both supporting and contradicting the finding. Mar.
Overseas Corp. v. Ellis, 971 S.W.2d 402, 406–07 (Tex. 1998). We do not set the
finding aside unless the evidence supporting it is so weak or so against the
overwhelming weight of the evidence that the finding is clearly wrong and unjust.
Dow Chem. Co., 46 S.W.3d at 242.
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We review a trial court’s conclusions of law de novo to determine if the trial
court drew the correct legal conclusions from the facts. BMC Software Belgium,
N.V. v. Marchand, 83 S.W.3d 789, 794 (Tex. 2002). We uphold conclusions of law
if any legal theory supported by the evidence sustains the judgment. Wyde v.
Francesconi, 566 S.W.3d 890, 895 (Tex. App.—Dallas 2018, no pet.).
The trial court found the following contractual provisions relevant to the
dispute in question:
i. Company is a referral agency and will make no guarantees,
representations or warranties about the qualifications, ability,
credentials, suitability, or performance of the candidates referred.
Signing up with or paying does not guarantee that it will refer or find a
suitable candidate or replacement candidate. (Emphasis added by trial
court).
ii. Client shall pay Company the following upon Client’s
employment or other engagement of a candidate when the candidate
accepts the position, and in all cases prior to the candidate reporting for
work with Client. . . .” (Emphasis added by trial court).
iii. All fees are non-refundable, earned in full, and immediately
due and payable when a Company referral results either directly or
indirectly in the engagement or employment by Client of a candidate
introduced or referred to Client by Company. (Emphasis added by trial
court).
iv. Upon fulfillment of all the conditions listed herein, subject to the
terms of this Agreement, if the initial full-time, part-time candidate
leaves Client’s employment within 180 days of placement, Company
will make reasonable efforts to . . . provide additional referrals to Client.
v. This Agreement is entered into by Company and Client without
reliance upon any statement, representation, promise, inducement, or
agreement not expressly contained herein. This Agreement constitutes
the entire agreement between Company and Client and supersedes all
prior oral and written agreements between Company and Client with
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respect to the subjects covered in this Agreement. This Agreement
shall not be amended or modified except in a mutually agreed upon
writing signed by Client and an authorized representative of Company.
Client represents that it has carefully read and fully understands the
scope and effect of all of the provisions of this Agreement; that it has
had all such time that it desires within which to consider this
Agreement; that it has had the opportunity to consult with an attorney
of its own choosing and at its own expense to review this Agreement;
and that it has availed itself of this opportunity to the extent, if any,
that it wished to do so. (Emphasis added by trial court).
The trial court found the terms “employment” and “engagement” were not defined
in the contract and applied the definitions commonly used and understood as defined
by Merriam Webster’s Online Dictionary. It defined “engagement” as “an
arrangement to meet or be present at a specified time and place.”1 It defined
“employment” as “the act of employing” and defined “employing” as “to make use
of someone or something.”2
The trial court further found that (1) appellees referred Powers; (2) appellants
engaged Powers as their nanny with a December 14, 2020 start date; (3) after
engaging Powers, appellants paid the referral fee per the contract terms; and (4)
Powers subsequently refused and failed to show up on her start date.
The trial entered the following conclusions of law:
The Plaintiffs to this action are sophisticated and highly educated
consumers who acknowledge that they read and understood the scope
and effect of the contract provisions and, to the extent they desired,
were able to avail themselves of legal counsel. There was a valid
contract between the parties. The parties performed their duties under
1
The trial court indicated this definition appeared at 1a of the online dictionary.
2
The trial court indicated this definition appeared at 1a of the online dictionary.
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the contract. Defendants referred nannies to Plaintiffs, and Plaintiffs
tendered payment for the referral upon their engagement of the nanny
of their choice—Powers then failed and refused to perform. The fee
Plaintiff paid to Defendants was non-refundable and fully earned at the
point at which it was paid because it was conditioned upon
“engagement” or “employment” of a nanny, and Plaintiffs had engaged
Powers at the point of payment.
(Emphasis added by trial court).
Appellants challenge the trial court’s construction of the contract and the
sufficiency of the evidence supporting the trial court’s application of the facts to the
contract. They argue the trial court relied on incorrect definitions of “engagement”
and “employment.” They assert the trial court should have used the following
definition of “engagement,” which appears in Webster’s Online Dictionary at 1b: “a
job or period of employment especially as a performer.” They further contend the
trial court should have used the following definition of “employ,” which appears at
1c(2): “to provide with a job that pays wages or a salary.” Construing these
definitions, appellants assert payment was due when a nanny was provided with a
job, and because Powers never accepted the position, she was never “engaged.”
Therefore, the condition for payment never occurred.
When interpreting a contract, our primary concern is to ascertain and give
effect to the written expression of the parties’ intent. Italian Cowboy Partners, Ltd.
v. Prudential Ins. Co. of Am., 341 S.W.3d 323, 333 (Tex. 2011) (citing J.M.
Davidson, Inc. v. Webster, 128 S.W.3d 223, 229 (Tex. 2003)). By this approach, we
“strive to honor the parties’ agreement and not remake their contract by reading
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additional provisions into it.” Gilbert Tex. Constr., L.P. v. Underwriters at Lloyd’s
London, 327 S.W.3d 118, 126 (Tex. 2010). “[I]t is objective, not subjective, intent
that controls.” Matagorda Cnty. Hosp. Dist. v. Burwell, 189 S.W.3d 738, 740 (Tex.
2006). We give words and phrases their ordinary and generally accepted meaning,
reading them in context and in light of the rules of grammar and common usage. See
Gilbert Tex. Constr., 327 S.W.3d at 126. We also bear in mind the particular
business activity to be served, and when possible and proper, we avoid a construction
that is unreasonable, inequitable, and oppressive. Frost Nat’l Bank v. L & F
Distribs., Ltd., 165 S.W.3d 310, 312 (Tex. 2005) (per curiam).
When a contract leaves a term undefined, we presume the parties intended its
plain, generally accepted meaning and give the term its ordinary meaning. Epps v.
Fowler, 351 S.W.3d 862, 866 (Tex. 2011). Often we consult dictionaries to discern
the natural meaning of a common-usage term not defined by the contract. Id.The trial court relied on the contractual term “engaged,” rather than
“employed,” in concluding appellees did not breach. Regardless of whether we
accept the definition used by the trial court (“an arrangement to meet or be present
at a specified time and place”) or the definition urged by appellants (“a job or period
of employment” and defining “employ” as “to provide with a job that pays . . . a
salary”), we reach the same conclusion. The contract required appellants to pay
appellees ten percent of a candidate’s total annual gross compensation “upon Clients
. . . engagement of a candidate when the candidate accepts the position.” Appellees
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referred Powers to appellants, who in turn offered her a job, which she accepted.
Powers agreed to start work on December 14, 2020, she agreed to a yearly salary of
$54,080.00, and appellants authorized payment of the $5,408.00 referral fee.
Applying the ordinary meaning of the contractual term, appellants “engaged”
Powers per the contract.
Emails also indicated appellants believed Powers accepted the position.
Specifically, Milligan told Powers he would notify other agencies they were no
longer looking for a candidate. And, when Powers changed her mind, Milligan told
her, “[W]e authorized the 10% referral fee of $5,600 [sic] to Nanny Poppinz in good
faith that we came to an agreement with you.” In a December 8, 2020 email to
Amber, Milligan indicated he was “equally taken aback” by Powers’s decision “as
we have been in contact with her nearly daily since our agreement was reached.”
Contrary to appellants’ position, nothing in the Nanny Poppinz contract required a
signed agreement between the family and a nanny before payment of the referral fee.
Reviewing the evidence in the light most favorable to the verdict, the trial
court’s findings are supported by the record and, therefore, legally sufficient. See
Dow Chem. Co., 46 S.W.3d at 241. To the extent appellants testified they did not
reach a final agreement with Powers, they never signed a contract with her, and they
believed they did not “engage” or “employ” her, we conclude the evidence
supporting the trial court’s findings to the contrary are not so weak or so against the
overwhelming weight of the evidence to be clearly wrong or unjust. Dow Chem.
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Co., 46 S.W.3d at 242. The trial court, as the factfinder in a bench trial, is in the best
position to determine the candor, demeanor, and credibility of the witnesses, and we
defer to its resolutions of conflicting evidence. Martinez v. Martinez, No. 02-21-
00353-CV, 2022 WL 17986023, at *4 n.8 (Tex. App.—Fort Worth Dec. 29, 2022,
no pet.) (mem. op.).
We reject appellants’ challenges to the legal and factual sufficiency of the trial
court’s findings regarding the breach of contract claim and likewise conclude the
trial court drew the correct legal conclusions from the facts. Both the contract’s
express terms and the record evidence supports the conclusion that the referral fee
was nonrefundable and fully earned at the point appellants paid it “because it was
conditioned upon ‘engagement’ or ‘employment’ of a nanny, and Plaintiffs had
engaged Powers at the point of payment.” Accordingly, the trial court properly
entered a take nothing judgment on appellants’ breach of contract claim.
We now consider appellants’ claim under the DTPA. They argue Nanny
Poppinz engaged in false, misleading, and deceptive acts because its website stated
it had a “NO FEE Policy” and “does not charge a fee of any kind UNTIL we provide
you with the nanny of your choice.” The trial court found appellees did not make
any false representations because they did not charge the referral fee until appellants
told them they had engaged Powers (the nanny of their choice). As discussed above,
the evidence supports the trial court’s findings that appellees did not charge a referral
fee until appellants hired Powers (the nanny of their choice), she accepted, and
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appellants told appellees to charge their card. As such, the trial court properly
entered a take-nothing judgment on appellants’ DTPA claim because they failed to
establish any false, misleading, or deceptive act. Appellants’ second issue is
overruled.
Conclusion
We affirm the trial court’s judgment.
/Erin A. Noewll/
ERIN A. NOWELL
JUSTICE
220675F.P05
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S
Court of Appeals
Fifth District of Texas at Dallas
JUDGMENT
DR. GREGORY MILLIGAN, M.D. On Appeal from the 116th Judicial
AND CHELLSE GAZDA, M.D., District Court, Dallas County, Texas
Appellants Trial Court Cause No. DC-21-05362.
Opinion delivered by Justice Nowell.
No. 05-22-00675-CV V. Justices Goldstein and Breedlove
participating.
AMBER MAYHEW, KEITH
MAYHEW, AND SSF
CONSULTING LLC D/B/A
NANNY POPPINZ, Appellees
In accordance with this Court’s opinion of this date, the judgment of the trial
court is AFFIRMED.
It is ORDERED that appellees AMBER MAYHEW, KEITH MAYHEW,
AND SSF CONSULTING, LLC D/B/A NANNY POPPINZ recover their costs of
this appeal from appellants DR. GREGORY MILLIGAN, M.D. AND CHELLSE
GAZDA, M.D.
Judgment entered July 14, 2023.
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