COURT OF APPEALS
EIGHTH DISTRICT OF TEXAS
EL PASO, TEXAS
JAMES F. ROTH, §
No. 08-12-00132-CV
Appellant, §
Appeal from the
v. §
17th District Court
JPMORGAN CHASE BANK, N.A., §
of Tarrant County, Texas
Appellee. §
(TC# 017-253241-11)
§
OPINION
In two issues, James F. Roth, Appellant, appeals the trial court’s summary judgment in
favor of JPMorgan Chase Bank, N.A. (the Bank), Appellee. We affirm.
BACKGROUND
The Bank brought suit against Roth for breach of contract alleging Roth had failed to make
payments on two promissory notes, the first a business installment loan and the second a business
line of credit, after the Bank demanded payment thereon. In its petition, the Bank asserted that all
conditions precedent to the institution of suit and the Bank’s recovery had been performed,
satisfied, or had occurred.
Roth filed a verified answer in which he asserted a general denial, a sworn denial, and
seven affirmative defenses.1 In his sworn denial, Roth specifically denied “each and every item
regarding offsets, credits and payments,” and alleged the Bank’s petition was not properly verified
if a sworn account.
The Bank filed its motion for summary judgment in which it set out its burden of showing
the existence of a debt from the maker of the notes, a subsequent default in payment of the notes,
and an amount fully due and owing after all credits have been given. The Bank asserted that it
was entitled to summary judgment as a matter of law as no genuine issue of material fact exists
regarding those elements. In support of its motion, the Bank included an affidavit from Joseph
Lounds, its Managed Assets Officer, who stated therein that the Bank is the owner and holder of
the notes, which are signed by Roth and made payable to the Bank, the notes are in default, the
Bank has made demand for payment, and Roth has failed to honor the terms of the notes.
Attached to Lounds’ affidavit are photocopies of the signed notes bearing Roth’s name and the
principal balance, interest, principal, fee, and payment histories for each note. The bank also
supported its summary judgment request for attorney’s fees with the affidavit of its counsel, K.
Mark Vincent.
In his response, Roth asserted that the Bank’s affidavits which form the basis of its
summary judgment motion are insufficient as a matter of law because Lounds’ affidavit: (1) fails
to show privity with the Bank and, thus, the Bank lacks standing; (2) fails to state how Lounds
acquired personal knowledge of the facts alleged, other than his role as the Bank’s Managed
Assets Officer who has access to the Bank’s business records and made the affidavit based upon
1
In his affirmative defenses, Roth denied that all conditions precedent to the Bank’s claims for recovery had occurred
or had been met, and asserted that the Bank’s claims were barred in whole or part by: (1) the doctrines of “waiver
and/or estoppel;” (2) the intervening acts of third parties over whom Roth had no authority or control; (3) the statute of
frauds and parol evidence rule; (4) the Bank’s failure to mitigate damages; (5) the economic-loss doctrine; and (6) the
doctrine of election of remedies.
2
his review of those records; (3) is replete with legal conclusions and hearsay, and short on
admissible facts; (4) is that of an interested witness; (5) and is supported by documents which
constitute inadmissible hearsay unless a proper exception to the hearsay rule is adequately
pleaded.
Roth also objected to the affidavit of K. Mark Vincent. In support of his summary
judgment response, Roth affixed his controverting affidavit in which he states, “I made my
payments when due, even though I should not have paid the total amount on [the line of credit]
note, only on the amount drawn[,]” and “I continued to make my payments and continued to
contest the amount charged on the [line of credit] note.” Roth additionally asserted, “The notes
have been reduced by my continued payments until 2011 when this suit was file[d].” Roth
discusses the amounts of the notes but does not specifically address any payments made or
balances owed.
Finding no genuine issues of material fact, the trial court granted summary judgment in
favor of the Bank.
DISCUSSION
In Issue One, Roth asserts the trial court erred in granting summary judgment in favor of
the Bank because there was “no evidence or insufficient evidence to support the finding.” Roth
specifically complains that the affidavit of Joseph Lounds fails to establish privity between
Appellant and the bank, fails to show how Lounds acquired personal knowledge of the facts
alleged, “other than his statement that [he is the] Managed Assets Officer and has access to [the
Bank’s] business records,” is replete with legal conclusions and hearsay, is “short on admissible
facts,” and is made by an interested witness. He also complains that the copies of notes and
3
payment records attached to Lounds’ affidavit are hearsay absent a properly pleaded exception
thereto.
Standard of Review
We review a summary judgment de novo. Valence Operating Company v. Dorsett, 164
S.W.3d 656, 661 (Tex. 2005). To prevail on a summary judgment motion, the movant must
demonstrate that there are no genuine issues of material fact and that it is entitled to judgment as a
matter of law. TEX. R. CIV. P. 166a(c); Provident Life and Acc. Ins. Co. v. Knott, 128 S.W.3d 211,
215–16 (Tex. 2003); Nixon v. Mr. Property Management Company, Inc., 690 S.W.2d 546, 548
(Tex. 1985).
A movant for summary judgment must conclusively prove all elements of its cause of
action as a matter of law. TEX. R. CIV. P. 166a(c); see Rockwall Commons Associates, Ltd. v.
MRC Mortg. Grantor Trust I, 331 S.W.3d 500, 505-06 (Tex. App. –El Paso 2010, no pet.). If
ordinary minds could not differ as to the conclusion to be drawn from the evidence, a matter is
conclusively proven. Id. at 505. If the movant conclusively proves its right to summary
judgment as a matter of law, the burden then shifts to the non-movant to present evidence that
raises a genuine issue of material fact, precluding the summary judgment. Id.
When determining whether a disputed issue of material fact exists that would preclude
summary judgment, we regard all evidence in the summary judgment record in the light most
favorable to the non-movant, and indulge every reasonable inference and resolve any doubts in
favor of the non-movant. Walters v. Cleveland Regional Medical Center, 307 S.W.3d 292, 296
(Tex. 2010); Provident, 128 S.W.3d at 215–16. When a trial court’s summary judgment order
does not state the specific grounds for its ruling, we must affirm the judgment if any of the theories
4
advanced by Appellee’s motion are meritorious. Western Investments, Inc. v. Urena, 162 S.W.3d
547, 550 (Tex. 2005).
The standards for determining the admissibility of evidence is the same in a summary
judgment proceeding as at trial. See Rockwall Commons Associates, Ltd., 331 S.W.3d at 505-06.
The admission or exclusion of evidence rests in the sound discretion of the trial court. See
Interstate Northborough Partnership v. State, 66 S.W.3d 213, 220 (Tex. 2001), citing City of
Brownsville v. Alvarado, 897 S.W.2d 750, 753 (Tex. 1995). Evidence presented in support of a
summary judgment must be in a form that would render the evidence admissible in a conventional
trial. TEX. R. CIV. P. 166a(f); see United Blood Services v. Longoria, 938 S.W.2d 29, 30 (Tex.
1997).
We apply an abuse of discretion standard when reviewing a trial court’s decision to admit
or exclude summary judgment evidence. Harris v. Showcase Chevrolet, 231 S.W.3d 559, 561
(Tex. App. –Dallas 2007, no pet.). The test for determining if the trial court abused its discretion
is whether the trial court acted without reference to any guiding rules or principles. Downer v.
Aquamarine Operators, Inc., 701 S.W.2d 238, 241–42 (Tex. 1985). If the trial court acts in an
arbitrary or unreasonable manner, it abuses its discretion. Id. at 242. That a trial court may
decide a matter within its discretionary authority in a different manner than the appellate court
does not demonstrate an abuse of discretion. Id.
Analysis
“A plaintiff who sues for recovery on a promissory note does not have to prove all essential
elements for a breach of contract but rather need only establish the note in question, that the
defendant signed it, that the plaintiff was the legal owner and holder thereof, and that a certain
5
balance is due and owing on the note.” Rockwall Commons Associates, Ltd., 331 S.W.3d at 505.
In response to Issue One, the Bank counters that Roth failed to dispute his execution of the notes or
that proper payment was given for all payments on the notes. We agree.
In his answer, Roth did not file a verified denial of his execution of any written instrument
on which the Bank’s pleadings were founded, or a verified denial of the genuineness of the
endorsement of the notes. TEX. R. CIV. P. 93(7), (8). In the absence of such sworn pleas, the
instruments are received in evidence as fully proved. Id. By these failures, Roth has
conclusively admitted the validity of the notes and that he signed the agreements, and has waived
any evidentiary objections thereto. See Bluebonnet Financial Assets v. Miller, 324 S.W.3d 603,
609 (Tex. App. –El Paso 2010, no pet.)(debtor who failed to file verified denials under TEX. R.
CIV. P. 93(4), (7), and (8) conclusively admitted proper parties were before trial court, validity of
credit card agreement which was the foundation of suit, and that he had signed agreement, and
waived evidentiary objections to the documents), citing Boyd v. Diversified Fin. Sys., 1 S.W.3d
888, 891 (Tex. App. –Dallas 1999, no pet.); Hanks v. NCNB Tex. Nat. Bank, 815 S.W.2d 763,
765 (Tex. App.—Eastland 1991, no writ)(a guarantor must, by sworn answer, deny the execution
of the underlying note or contract by the principal obligor, or the execution thereof is presumed);
Loveless v. Tex. First Mort. Reit, 531 S.W.2d 870, 873 (Tex. Civ. App.—Houston [1st Dist.]
1975, writ dism’d).
Payment is an affirmative defense under the Texas Rules of Civil Procedure. TEX. R. CIV.
P. 94; F-Star Socorro, L.P. v. City of El Paso, 281 S.W.3d 103, 108 (Tex. App.—El Paso 2008, no
pet.). The right to an offset of payment is also an affirmative defense. TEX. R. CIV. P. 94; F-Star
Socorro, L.P., 281 S.W.3d at 108. An affirmative defense must be pleaded in a responsive
6
pleading, or the defense will be waived. F-Star Socorro, L.P., 281 S.W.3d at 108. Rule 95 also
requires a defendant who wishes to allege payment as an affirmative defense to “file with his plea
an account stating distinctly the nature of such payment, and the several items thereof; failing to do
so, he shall not be allowed to prove the same[.]” TEX. R. CIV. P. 95; F-Star Socorro, L.P., 281
S.W.3d at 108. In his answer, Roth failed to plead the affirmative defense of payment, and failed
to file with his plea the requisite account stating distinctly the nature of the payment.
Consequently, Roth has waived any payment or offset defenses. TEX. R. CIV. P. 94, 95; F-Star
Socorro, L.P., 281 S.W.3d at 108. Because there is no genuine issue of material fact as to the
elements of liability, the trial court did not abuse its discretion when it granted summary judgment
in favor of the Bank. Rockwall Commons Associates, Ltd., 331 S.W.3d at 505-06 (elements).
Moreover, defects in the form of affidavits or attachments will not be grounds for reversal
unless specifically pointed out by objection by an opposing party with opportunity, but refusal, to
amend. TEX. R. CIV. P. 166a(f). A party objecting to the competency of summary judgment
proof must obtain a ruling on its objection or obtain a written order signed by the trial judge and
entered of record, or the objection is waived and the proof remains a part of the summary judgment
record. Velasquez v. Waste Connections, Inc., 169 S.W.3d 432, 436 (Tex. App. –El Paso 2005,
no pet.). Because there is nothing in the record showing Roth obtained a ruling or written order
signed by the trial court and entered of record regarding his objections to the Bank’s summary
judgment evidence, Roth has waived his complaint regarding the admissibility of the Bank’s
summary judgment evidence.2 Issue One is overruled.
In Issue Two, Roth complains that the trial court erred in granting the Bank attorney fees in
its summary judgment order because K. Mark Vincent’s affidavit contains “nothing more than
2
The record on appeal does not include a Reporter’s Record.
7
opinions and legal conclusions of an interested witness” and lacks an evidentiary foundation for
the amount of attorney fees sought.
A prevailing party in a suit on written contract is entitled to attorney’s fees. TEX. CIV.
PRAC. & REM. CODE ANN. § 38.001(8)(West 2008). An award of attorney’s fees must be
supported by evidence that the fees are reasonable and necessary. See Stewart Title Guar. Co. v.
Sterling, 822 S.W.2d 1, 10 (Tex. 1991). A trial court determines the reasonableness of an
attorney’s fees award by considering the factors enumerated in Arthur Andersen & Co. v. Perry
Equipment Corp. 945 S.W.2d 812, 818 (Tex. 1997)(evidence of contingency fee agreement alone
does not support award of reasonable and necessary attorney’s fees and trial court must still
consider other factors). The reasonableness of attorney’s fees is generally a fact issue. Haden v.
David J. Sacks, P.C., 332 S.W.3d 503, 512 (Tex. App.-Houston [1st Dist.] 2009, pet. denied). We
will not disturb a trial court’s award of attorney’s fees absent an abuse of discretion. Karam v.
Brown, 407 S.W.3d 464, 474-75 (Tex. App. –El Paso 2013, no pet.).
Summary judgment may be based on the uncontroverted testimonial evidence of an
interested witness, or of an expert witness as to subject matter concerning which the trier of fact
must be guided solely by the opinion testimony of experts, if the evidence is clear, positive and
direct, otherwise credible and free from contradictions and inconsistencies, and could have been
readily controverted. See TEX. R. CIV. P. 166a(c). An attorney’s affidavit constitutes expert
testimony that will support an award of attorney’s fees in a summary judgment proceeding. See
Haden, 332 S.W.3d at 513. Civil Practice and Remedies Code section 38.003 provides that
“usual and customary attorney’s fees” are presumed to be reasonable. TEX. CIV. PRAC. & REM.
CODE ANN. § 38.003 (West 2008). Although the statutory presumption that usual and customary
8
fees are reasonable is rebuttable, once triggered by an attorney’s supporting affidavit, the
presumption of reasonableness remains in effect when there is no evidence submitted to challenge
the affidavit proof of the summary judgment movant. See TEX. CIV. PRAC. & REM. CODE ANN. §
38.003 (West 2008); Haden, 332 S.W.3d at 513.
We have reviewed Vincent’s affidavit and conclude it was sufficient to support the Bank’s
claim for attorney’s fees. See Haden, 332 S.W.3d at 514. Roth did not file a controverting
affidavit or any other evidence disputing Vincent’s evidence and cannot overcome the presumed
reasonableness of Vincent’s affidavit in support of an award of attorney’s fees. See id. at 514–16
(where nonmovant failed to controvert attorney’s affidavit or otherwise dispute law firm’s
evidence, law firm was entitled to statutory presumption that the requested amount was both
reasonable and necessary). Because the trial court did not abuse its discretion in awarding
attorney’s fees, Issue Two is overruled.
CONCLUSION
The trial court’s judgment is affirmed.
GUADALUPE RIVERA, Justice
July 23, 2014
Before McClure, C.J., Rivera, and Rodriguez, JJ.
9