Perry D. Felix D/B/A Han's Laser Technology Co. v. Prosperity Bank

ACCEPTED
01-14-00997-CV
FIRST COURT OF APPEALS
HOUSTON, TEXAS
3/25/2015 4:37:34 PM
CHRISTOPHER PRINE
CLERK

N O . 01–14–00997–CV
FILED IN
In the First Court of Appeals 1st COURT OF APPEALS
HOUSTON, TEXAS
Houston, Texas
3/25/2015 4:37:34 PM
CHRISTOPHER A. PRINE
Clerk
Perry D. Felix d/b/a Han’s Laser Technology Co., Appellant

v.

Prosperity Bank, Appellee

From the 164th District Court, Harris County, Texas
Cause No. 2013–50191

PROSPERITY BANK’S CROSS–APPELLANT’S BRIEF

Hirsch & Westheimer, P.C.

Michael D. Conner
State Bar No. 04688650
mconner@hirschwest.com
William “Pat” Huttenbach
State Bar No. 24002330
phuttenbach@hirschwest.com
Jacob M. Stephens
State Bar No. 24066143
jstephens@hirschwest.com
1415 Louisiana, 36th Floor
Houston, Texas 77002
Telephone: (713) 220–9162
Facsimile: (713) 223–9319

ATTORNEYS FOR
APPELLEE/CROSS–APPELLANT,
PROSPERITY BANK

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 IDENTITY OF PARTIES AND COUNSEL

Appellant: Attorneys:

Perry D. Felix d/b/a Han’s Laser J. Steven Stewart
Technology Co. State Bar No: 19210500
jss@jstevenstewart.com
5353 West Alabama, Suite 605
Houston, Texas 77056
Telephone: (713) 977–3447
Fax: (832) 201– 9117

Appellee/Cross–Appellant: Attorneys:

Prosperity Bank Michael D. Conner
State Bar No. 04688650
mconner@hirschwest.com
William “Pat” Huttenbach
State Bar No. 24002330
phuttenbach@hirschwest.com
Jacob M. Stephens
State Bar No. 24066143
jstephens@hirschwest.com
1415 Louisiana, 36th Floor
Houston, Texas 77002
Telephone: (713) 220–9162
Facsimile: (713) 223–9319

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 TABLE OF CONTENTS

Identity of Parties and Counsel ..................................................................... i

Table of Contents........................................................................................ ii

Table of Authorities ................................................................................... iv

Statement of the Case .................................................................................. 1

Cross Issue Presented .................................................................................. 2

The trial court erred by failing to award attorneys’ fees to
Prosperity for Felix’s breach of the written deposit agreement. ............ 2

Preliminary Statement ................................................................................. 2

Statement of Facts Pertinent to Prosperity’s Cross Issue ............................... 2

Summary of the Argument .......................................................................... 6

Argument & Authorities & Standard of Review .......................................... 7

Standard of Review ............................................................................ 7

Felix failed to comply with the written agreement................................ 8

The deposit agreement is treated like any contract. .............................. 9

Attorneys’ fees are recoverable. ......................................................... 10

Prosperity is entitled to its fees under Chapter 38. .............................. 12

Prosperity complied with Chapter 38. ................................................ 13

Prosperity conclusively proved its fees. .............................................. 14

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Conclusion & Prayer..................................................................................16

Certificate of Compliance ...........................................................................17

Certificate of Service ..................................................................................17

Appendix ...................................................................................................18

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 TABLE OF AUTHORITIES

Cases

1/2 Price Checks Cashed v. United Auto. Ins. Co.,
344 S.W.3d 378 (Tex. 2011) ................................................................ 12

Akin, Gump, Strauss, Hauer & Feld, L.L.P. v.
Nat'l Dev. & Research Corp.,
299 S.W.3d 106 (Tex. 2009) ................................................................ 11

Albataineh v. Eshtehardi, 2013 WL 1858864
(Tex. App.–Houston [1st Dist.] May 2, 2013, no pet.) .......................... 12

Anderson v. McCormick,
2013 WL 5884931
(Tex. App.–Houston [1st Dist.] Oct. 31, 2013, no pet.) ........................ 15

Berg v. Wilson,
353 S.W.3d 166 (Tex. App.–Texarkana 2011, pet. denied) ................... 13

Bocquet v. Herring,
972 S.W.2d 19 (Tex. 1998).................................................................. 15

Boyaki v. John M. O’Quinn & Associates, PLLC,
2014 WL 4855021
(Tex. App.–Houston [1st Dist.] Sept. 30, 2014, pet. filed) .............. 12, 13

Brainard v. Trinity Universal Ins. Co.,
216 S.W.3d 809 (Tex. 2006) ................................................................ 14

Buckhannon Bd. & Care Home, Inc. v.
W. Va. Dep't of Health and Human, Res.,
532 U.S. 598, 121 S. Ct. 1835, 149 L.Ed.2d 855 (2001)......................... 10

Flavor Finish Resurfacing, L.L.C. v. Ellerkamp,
2012 WL 3776345
(Tex. App.–Houston [1st Dist.] Aug. 30, 2012, no pet.) .........................9

iv
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Fleischmann Distilling Corp. v. Maier Brewing Co.,
386 U.S. 714, 87 S. Ct. 1404, 18 L.Ed.2d 475 (1967) ............................ 10

G.R.A.V.I.T.Y. Enters., Inc. v. Reece Supply Co.,
177 S.W.3d 537 (Tex. App.–Dallas 2005, no pet.) ............................... 10

Helping Hands Home Care, Inc. v. Home Health of Tarrant County, Inc.,
393 S.W.3d 492 (Tex. App.–Dallas 2013, pet. denied) ......................... 11

Honeycutt v. Billingsley,
992 S.W.2d 570 (Tex. App.–Houston [1st Dist.] 1999, pet. denied ....... 14

Jim Maddox Properties, LLC v. WEM Equity Capital Investments, Ltd.,
446 S.W.3d 126 (Tex. App.–Houston [1st Dist.] 2014, no pet.) ..............7

Lofton v. Texas Brine Corp.,
777 S.W.2d 384 (Tex.1989) ................................................................. 14

M.D. Anderson Hosp. & Tumor Inst. v. Willrich,
28 S.W.3d 22 (Tex. 2000) .....................................................................8

Mann Frankfort Stein & Lipp Advisors, Inc. v. Fielding,
289 S.W.3d 844 (Tex.2009) ...................................................................7

Pala v. Maxim,
2002 WL 188567
(Tex. App.–Houston [1st Dist.] Feb. 7, 2002, no pet.) ......................... 15

Rasmusson v. LBC PetroUnited, Inc.,
124 S.W.3d 283 (Tex. App.–Houston [14th Dist.] 2003, pet. denied) ... 12

Rayon v. Energy Specialties, Inc.,
121 SW.3d 7(Tex. App.–Fort Worth 2002, no pet. ...............................8

SAS Inst., Inc. v. Breitenfeld,
167 S.W.3d 840 (Tex. 2005) ..................................................................7

Seagull Energy E & P, Inc. v. Eland Energy, Inc.,
207 S.W.3d 342 (Tex. 2006) ..................................................................9

v
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Sherrick v. Wyland,
14 Tex. Civ. App. 299, 37 S.W. 345 (1896).......................................... 11

Smith v. Garrett,
29 Tex. 48 (1867) ................................................................................ 11

Tony Gullo Motors I, L.P. v. Chapa,
212 S.W.3d 299 (Tex. 2006) ................................................................ 10

Williams v. Compressor Eng’g Corp.,
704 S.W.2d 469
(Tex. App.–Houston [14th Dist.] 1986, writ ref’d n.r.e.) ...................... 13

Wm. Cameron & Co. v. Am. Sur. Co. of N.Y.,
55 S.W.2d 1032 (Tex. Comm’n App. 1932, judgm’t adopted) .............. 10

Woody v. J. Black’s, L.P.,
2013 WL 5744359 (Tex. App.–Amarillo Oct. 13, 2013, pet. denied) ... 12

Statutes

Tex. Civ. Prac. & Rem. Code § 9.001, et seq... .........................................6

Tex. Civ. Prac. & Rem. Code § 10.001, et seq. .........................................6

Tex. Civ. Prac. & Rem. Code § 38.001. .................................................. 12

Tex. Civ. Prac. & Rem. Code § 38.002 ............................................. 14, 15

Tex. Civ. Prac. & Rem. Code § 38.005 ................................................... 12

Tex. Fin. Code § 34.301 ...........................................................................9

Rules

Tex. R. App. P. 9.4(e) ............................................................................ 18

Tex. R. App. P. 9.4(i) ............................................................................. 18

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Tex. R. Civ. P. 13 ....................................................................................6

Tex. R. Civ. P. 21a ................................................................................ 18

Tex. R. Civ. P. 166a(c) .............................................................................7

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20090252.20140460/2125761.1
 STATEMENT OF THE CASE

Nature of Case Breach of bank deposit agreement.

Trial Court The 164th District Court in Harris
County, Texas, the Hon. Alexandra
Smoots–Hogan

Course of Proceedings Perry D. Felix d/b/a Han’s Laser
Technology Co. (“Felix”) sued Prosperity
Bank (“Prosperity”) alleging unauthorized
wire transfers from his account. CR.5–
17. Prosperity counterclaimed alleging
untimely notice and resulting breach of
the deposit contract’s covenant not to
sue. SuppCR.183–86. Prosperity moved
for summary judgment on Felix’s claims
and the counterclaim. CR.84, et seq.;
SuppCR.77, et seq.; 103, et seq.;
SuppCR.225, et seq. 133, et seq.;
SuppCR.3, et seq.

Trial Court’s Disposition The trial court granted summary
judgment in favor of Prosperity on all
Felix’s claims against Prosperity and all
Prosperity’s claims against Felix but
declined to award attorneys’ fees to
Prosperity. CR.172–73.

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 CROSS ISSUE PRESENTED

The trial court erred by failing to award attorneys’ fees to
Prosperity for Felix’s breach of the written deposit agreement.
PRELIMINARY STATEMENT

This cross–appellant’s brief focuses on Prosperity’s counterclaim for

attorneys’ fees. The record conclusively shows (i) the contract includes a

conditioned covenant not to sue; (ii) without satisfying the condition

precedent, suit was filed; and (iii) despite notice and opportunity to stand

down, Felix elected to continue prosecuting the claims in violation of his

agreement not to sue.

Prosperity reserves for its appellee’s brief arguments responsive to

such issues as Felix, as appellant, may present.

STATEMENT OF FACTS PERTINENT TO PROSPERITY’S CROSS ISSUE

Felix had a deposit account at Prosperity. See SuppCR.87–91, 93,

94–100. The account was governed by a written deposit agreement. See id.

The written agreement provides, in part:

STATEMENTS – You must examine your statement of account
with “reasonable promptness.” If you discover (or reasonably
should have discovered) any unauthorized payments or
alterations, you must promptly notify us of the relevant facts.
* * *

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 You agree that the time you have to examine your
statement and report to us will depend on the circumstances, but
will not, in any circumstance, exceed a total of 30 days from when
the statement is first made available to you.
You further agree that if you fail to report any unauthorized
signatures, alterations, forgeries or any other errors in your
account within 60 days of when we make the statement available,
you cannot assert a claim against us on any items in that
statement, and the loss will be entirely yours.
This 60 day limitation is without regard to whether we
exercised ordinary care. The limitation in this paragraph is in
addition to that contained in the first paragraph of this section.

SuppCR.93; see also SuppCR.97.

Prosperity sent statements of the account monthly. SuppCR.89; see

also SuppCR.101–20. Felix contends he promptly examined the account

statements. SuppCR.156 (resp. to req. for adm’n #18). Each of the wire

transfers for which Felix sued is disclosed on a statement of the account

(see SuppCR.101–20); the last two transactions appear on the statement

dated December 31, 2010. See SuppCR.115–17.

Felix claims to have requested additional documentation – at the

earliest between December 16, 2010 and March 29, 2011 – regarding

unspecified wire transfers. The first indication that Felix actually identified

particular wire transfers he considered problematic, i.e., notified

Prosperity of relevant facts (see SuppCR.93, 97), is his purported July 12,

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2011 telephone call and follow–up e–mail. See SuppCR.208. Of four

transactions identified – “[t]he other wire transfers and amounts can be

dismissed . . .” (id.), Felix admitted in discovery that two were authorized.

SuppCR.149. As to his authorization of a third wire transfer identified in

the email (8/9/10; $5,832.00), Felix answered “unable to either admit or

deny.” SuppCR.153. And, the fourth (8/26/2010; $21,770.00) Felix

responded, “denied”; but, he expounded that the transfer appeared to

duplicate a previous transfer and that Prosperity failed to “combine[] or

consolidate[]” transfers to the same vendor “to avoid duplicate transaction

fees as was customary for wire transfers submitted and authorized by

Plaintiff.” SuppCR.150.

Felix sent a letter to Prosperity’s Mr. Gonzales (in Houston) dated

September 23, 2011. SuppCR.210–11. The letter requests documents

regarding wire transfers for the period “March 2010 through 2011.” Id.

Despite his July statement that “[t]he other wire transfers and amounts can

be dismissed . . .” (SuppCR.208), Felix included a list of 23 transactions.

SuppCR.211. Neither the letter nor the list describes any transaction as

unauthorized. SuppCR.210–11.

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 Felix sent another letter, also dated September 23, 2011, to

Prosperity’s Mr. Zalman at the Corporate Office in El Campo. See

SuppCR.121–22. Felix listed eleven transfers and described two “faxed

wire transfer requests” as “fraudulent.” SuppCR.121. One of the so–called

“fraudulent” transactions is the same 8/26/2010, $21,770.00 transaction

mentioned above.1 See SuppCR.150. Regarding the other so–called

“fraudulent” transaction (10/19/2010), Felix had previously described his

“investigat[ion].” See SuppCR.208. The July 12, 2011 email did not

challenge authorization for the transfer. Rather, Felix wrote, “I have a

record of this transfer however the vendor claimed they did not receive

payment . . ..” Id. In any event, Felix’s report was more than 60 days after

all related statements.

Prosperity’s October 3, 2011 response specifically addressed the two

so–called “fraudulent” transactions – August 26, 2010 ($21,770.00);

October 19, 2010 ($31,146.00) – including how each was initiated and to

whom each was sent. SuppCR.44. Prosperity’s letter specifically referred

to the deposit agreement provision requiring notice of any claimed errors

within 60 days and Felix’s failure to have provided such notice. Id.

1
There also was a $38,849.00 wire on 8/26/2010. Felix gave a similar interrogatory
response claiming supposed duplication of transaction fees, not a lack of authorization
to wire funds. SuppCR.151.

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 Almost two years later Felix sued. CR.5. In a letter dated October 7,

2013, counsel for Prosperity requested dismissal of the suit referencing

Texas Rule of Procedure 13, Texas Civil Practice and Remedies Code

chapters 9 and 10 and terms of the account agreement. SuppCR.166–68.

As above, the account agreement includes that Felix had 30 days to

examine statements and report problems. SuppCR.93; SuppCR.97. The

contract includes Felix’s “further agree[ment]” that if he failed to report

errors within 60 days of statement availability, he “cannot assert a claim …

on any item in that statement . . ..” Id. With demand and the opportunity

to do so, Felix declined to dismiss his claims against Prosperity.

SUMMARY OF THE ARGUMENT

An agreement not to assert a claim should be treated as any other

contractual obligation.

In a relationship governed by a written contract, Felix failed to

comply with a condition precedent by failing to review statements and

report relevant facts within 30 days. Felix also failed to honor his

agreement that he cannot assert a claim without first having reported

allegedly “unauthorized signatures, alterations, forgeries or any other

errors” within 60 days of when a statement containing a supposed error

was made available. Felix’s failure to comply with the agreement injured

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Prosperity including the costs and fees incurred to respond to claims Felix

agreed he “cannot assert.” Prosperity is entitled to enforce the contract as

written and recover the foreseeable damages caused by Felix’s breach.

Having granted summary judgment in Prosperity’s favor on all of its claims

against Felix (CR.173), the trial court abused its discretion by failing to

award damages supported by the pleadings, the motion and the summary

judgment evidence.

ARGUMENT & AUTHORITIES & STANDARD OF REVIEW

Standard of Review

To show itself entitled to relief through a traditional motion for

summary judgment, Prosperity must have established that no issue of

material fact exists on its counterclaim and that it is entitled to judgment as

a matter of law. See Tex. R. Civ. P. 166a(c); SAS Inst., Inc. v. Breitenfeld,

167 S.W.3d 840, 841 (Tex. 2005). The Court’s review is de novo. Jim

Maddox Properties, LLC v. WEM Equity Capital Investments, Ltd., 446

S.W.3d 126, 131 (Tex. App.–Houston [1st Dist.] 2014, no pet.) (citing

Mann Frankfort Stein & Lipp Advisors, Inc. v. Fielding, 289 S.W.3d 844,

848 (Tex. 2009)).

Where the motion and summary judgment evidence facially

establish the movant’s right to judgment as a matter of law, the burden

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shifts to the non–movant to raise a genuine, material fact issue sufficient to

defeat summary judgment. See M.D. Anderson Hosp. & Tumor Inst. v.

Willrich, 28 S.W.3d 22, 23–24 (Tex. 2000). A material fact issue is

“genuine” only if the evidence is such that “a reasonable jury could find

the fact in favor of the nonmoving party.” Rayon v. Energy Specialties,

Inc., 121 SW.3d 7, 11 (Tex. App.–Fort Worth 2002, no pet.).

Felix failed to comply with the written agreement.

Prosperity counterclaimed for breach of the written deposit

agreement. SuppCR.183–86. The contract was conclusively proved to

exist. See SuppCR.87–91, 93, 94–100. The contract includes Felix’s

agreement that he cannot assert the claims he asserted without first having

complied with his duty to timely report. SuppCR.93, 97. Felix’s failure to

comply with his contractual obligation to report any problems appearing

on an account statement within 30 days or 60 days after any specific

account statement was made available was conclusively established. See,

e.g., SuppCR.89. Nevertheless, Felix sued. Prosperity’s injury was

foreseeable; it was required to appear, defend the claims and assert its right

to enforce the contract as written. Prosperity conclusively established the

injury and the amount of fees it incurred. See SuppCR.74–76, 124–26.

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 Because Prosperity conclusively established its injury that would not

have occurred but for Felix’s breach, Prosperity was entitled to recover its

fees and the trial court erred by failing to award them.

The deposit agreement is treated like any contract.

“A deposit contract between a bank and an account holder is

considered a contract in writing for all purposes ….” Tex. Fin. Code §

34.301. When interpreting a contract the court endeavors “to ascertain

and give effect to the intent of the parties as that intent is expressed in the

contract.” See, e.g., Seagull Energy E & P, Inc. v. Eland Energy, Inc., 207

S.W.3d 342, 345 (Tex. 2006); Flavor Finish Resurfacing, L.L.C. v.

Ellerkamp, 01–11–00099–CV, 2012 WL 3776345, at *4 (Tex. App.–

Houston [1st Dist.] Aug. 30, 2012, no pet.) (mem. op.). The trial court

properly construed the plain language to the effect that Felix “further

agree[d] that if [he] fail[ed] to report any unauthorized signatures,

alterations, forgeries or any other errors in [the] account within 60 days of

when we make the statement available, you cannot assert a claim against

[Prosperity] on any items in that statement” (see SuppCR.93, 97) and

determined that Felix breached that agreement. CR.172–73. However, the

trial court erred by failing to award attorneys’ fees, the fees and expenses

necessarily incurred in responding to a suit Felix promised not to bring.

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The Court reviews decisions regarding the award of attorneys’ fees de

novo. See G.R.A.V.I.T.Y. Enters., Inc. v. Reece Supply Co., 177 S.W.3d

537, 546 (Tex. App.–Dallas 2005, no pet.).

Attorneys’ fees are recoverable.

The general rule in Texas is that attorney’s fees incurred in

prosecuting or defending a lawsuit are not recoverable in that suit absent a

statute or contract allowing the recovery. See Tony Gullo Motors I, L.P. v.

Chapa, 212 S.W.3d 299, 310–11 (Tex. 2006) (“Absent a contract or statute,

trial courts do not have inherent authority to require a losing party to pay

the prevailing party’s fees.”); Wm. Cameron & Co. v. Am. Sur. Co. of

N.Y., 55 S.W.2d 1032, 1035 (Tex. Comm’n App. 1932, judgm’t adopted)

(“It is settled law in this state that, unless provided for by statute or by

contract between the parties, attorneys’ fees incurred by a party to

litigation are not recoverable against his adversary either in an action in

tort or a suit upon a contract.”). The rule is known as the American Rule.

See Buckhannon Bd. & Care Home, Inc. v. W. Va. Dep’t of Health and

Human Res., 532 U.S. 598, 602, 121 S. Ct. 1835, 149 L.Ed.2d 855 (2001)

(“[P]arties are ordinarily required to bear their own attorney’s fees—the

prevailing party is not entitled to collect from the loser.”); Fleischmann

Distilling Corp. v. Maier Brewing Co., 386 U.S. 714, 718, 87 S. Ct. 1404,

10
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18 L.Ed.2d 475 (1967). The rationale was succinctly stated well over a

century ago in Sherrick v. Wyland, 14 Tex. Civ. App. 299, 37 S.W. 345,

345 (1896): “It has often been ruled, in this state and elsewhere, that fees of

counsel, incurred in prosecuting a suit for or defending against a wrong,

are not ordinarily recoverable as actual damages, because they are not

considered proximate results of such wrong.” See Akin, Gump, Strauss,

Hauer & Feld, L.L.P. v. Nat’l Dev. & Research Corp., 299 S.W.3d 106,

120 (Tex. 2009). Here the fees incurred are the proximate result of Felix’s

breach; but for his non–compliance, there would have been no suit to

defend and no counterclaim to pursue. Both the contract and a statute

afford Prosperity the right to recover the fees for which it counterclaimed.

The contract includes Felix’s express agreement not to make a claim

without first having timely reported the problem underlying the suit.

SuppCR.93, 97. Texas law has been clear for over 100 years:

A covenant not to sue may be plead in suspension of action by
the debtor whenever broken, and its observance will be enforced,
and damages for breach may be recovered.

Smith v. Garrett, 29 Tex. 48, 52 (1867). Further, the contract itself need

not provide for attorneys’ fees. See Helping Hands Home Care, Inc. v.

Home Health of Tarrant County, Inc., 393 S.W.3d 492, 516 (Tex. App.–

Dallas 2013, pet. denied).

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Prosperity is entitled to its fees under Chapter 38.

The statute, chapter 38 of the Civil Practice and Remedies Code, 2

has been applied by this Court and others to afford the relief to which

Prosperity is entitled. See, e.g., Boyaki v. John M. O’Quinn & Associates,

PLLC, 01–12–00984–CV, 2014 WL 4855021, at *13–14 (Tex. App.–

Houston [1st Dist.] Sept. 30, 2014, pet. filed) (mem. op.); Woody v. J.

Black’s, L.P., 07–12–00192–CV, 2013 WL 5744359, at *6 (Tex. App.–

Amarillo Oct. 13, 2013, pet. denied) (mem. op.) (“injunction enforcing

specific performance of a contract is something of value” sufficient to

support Chapter 38 attorneys’ fees and rejecting argument that an award of

monetary damages were required); Albataineh v. Eshtehardi, 01–12–

00671–CV, 2013 WL 1858864, at *1–2 (Tex. App.–Houston [1st Dist.]

May 2, 2013, no pet.) (mem. op.) (“judgment requiring specific

performance of a material contract right can support an award of

attorney’s fees”); Rasmusson v. LBC PetroUnited, Inc., 124 S.W.3d 283,

287 (Tex. App.–Houston [14th Dist.] 2003, pet. denied) (holding that

award of specific performance of arbitration agreement permitted recovery

2
See Tex. Civ. Prac. & Rem. Code § 38.001, et seq. “The Legislature instructs us
to construe section 38.001 ‘liberally ... to promote its underlying purposes.’” 1/2 Price
Checks Cashed v. United Auto. Ins. Co., 344 S.W.3d 378, 382 (Tex. 2011) (quoting
Tex. Civ. Prac. & Rem. Code § 38.005).

12
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of Chapter 38 attorneys’ fees and rejecting argument that monetary

damages were required); Williams v. Compressor Eng’g Corp., 704

S.W.2d 469, 474 (Tex. App.–Houston [14th Dist.] 1986, writ ref’d n.r.e.)

(interpreting Chapter 38 to authorize an award of attorneys’ fees when a

party “successfully prosecutes a claim founded on ... written contracts.”).3

Thus, as the Court held in Boyaki, if the evidence supports a finding that

such relief – there a promise to end litigation; here a promise not to sue in

the first place – is of more than nominal economic value, section 38.001

affords the claimant its attorneys’ fees, provided that all other conditions

to a right to recovery under that chapter are met. Boyaki, 2014 WL

4855021, at *14.

Prosperity complied with Chapter 38.

Prosperity satisfied “all other conditions” to its right to recover

under Chapter 38. Prosperity was represented by counsel; it presented the

counterclaim to Felix by letter (SuppCR.45–47); and Felix failed to “pay”

by failing to dismiss his unfounded suit within thirty days of presentment.

3
But see, e.g., Haubold v. Medical Carbon Research Inst., 2014 WL 1018008 at
*5–6 (Tex. App.–Austin March 14, 2014, no pet.) (mem. op.) (specific performance to
enforce Rule 11 agreement was not a recovery of actual damages; thus fees incurred in
enforcing the agreement were not recoverable); Berg v. Wilson, 353 S.W.3d 166, 182
(Tex. App.–Texarkana 2011, pet. denied) (concluding, “because Wilson did not recover
actual damages, she was not entitled to recover attorneys’ fees on her [Rule 11] breach
of contract claim,” but affirming award on alternative basis).

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Tex. Civ. Prac. & Rem. Code § 38.002; see Brainard v. Trinity Universal

Ins. Co., 216 S.W.3d 809, 817 (Tex. 2006); see also Honeycutt v.

Billingsley, 992 S.W.2d 570, 581 (Tex. App.–Houston [1st Dist.] 1999, pet.

denied).

Prosperity conclusively proved its fees.

Prosperity proved the reasonableness, necessity and amount of its

fees. SuppCR.74–76, 90, 124–26. Felix did not controvert and did not

object to the affidavit testimony of attorneys William Huttenbach and

Charles Pignuolo. See Lofton v. Texas Brine Corp., 777 S.W.2d 384, 386

(Tex. 1989) (Testimony of an interested witness may establish a fact as a

matter of law only if: (1) the testimony could be readily contradicted if

untrue; (2) it is clear, direct, and positive; and (3) there are no

circumstances tending to discredit or impeach it.). Attorney Huttenbach

testified that reasonable and necessary attorneys’ fees comprised his firm’s

calculated charges of $8,500.00 as of the date of his affidavit (October 17,

2014; SuppCR.76), plus anticipated additional fees for twelve hours at the

rate of $345.00 per hour, plus fees previously incurred for services

rendered by Mr. Pignuolo. SuppCR.74–75. Attorney Pignuolo testified

that his firm’s reasonable and necessary fees and out–of–pocket expenses

through the date of his affidavit (April 17, 2014; SuppCR.126) totaled

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$8,539.52 and would likely increase at the rate of $300.00 per hour

thereafter. SuppCR.125. Based on the testimony, Prosperity conclusively

proved reasonable and necessary attorneys’ fees in at least the amount of

$21,197.52.

Having conclusively proved Felix’s failure to comply with his

agreement not to assert the claims he asserted; having established the

elements of section 38.002; and, having presented clear, direct, positive

and uncontroverted evidence of the amount of its reasonable and

necessary attorneys’ fees, award of such fees was mandatory. See Bocquet

v. Herring, 972 S.W.2d 19, 20 (Tex. 1998); Anderson v. McCormick, 01–

12–00856–CV, 2013 WL 5884931, at *5 (Tex. App.–Houston [1st Dist.]

Oct. 31, 2013, no pet.). On this record, the trial court had no discretion to

award $0.00. See Pala v. Maxim, 01–01–00618–CV, 2002 WL 188567, at *6

(Tex. App.–Houston [1st Dist.] Feb. 7, 2002, no pet.) (citing Bocquet,

supra). Prosperity, therefore, is entitled to reversal and rendition as to the

portion of the judgment omitting an award of Prosperity’s fees.

[In the alternative, only, should the Court determine that

Prosperity’s fees were not conclusively established below, based on the

foregoing arguments and record references (see, e.g., SuppCR.74–76, 124–

26), there is some evidence of the reasonableness, necessity and an amount

15
20090252.20140460/2125761.1
of fees. Consequently, Prosperity is entitled – at minimum – to remand for

a determination of the correct amount to be awarded.]

CONCLUSION & PRAYER

For at least the foregoing reasons, Prosperity asks the Court to

reverse the trial court’s judgment, in part, and to render judgment in

Prosperity’s favor as to all liability issues and to render judgment that

Prosperity recover the amount of $21,179.52 from Felix and for all

additional or alternative relief to which it may be justly entitled.

Respectfully submitted,

HIRSCH & WESTHEIMER, P.C.

By: /s/ Michael D. Conner
Michael D. Conner
State Bar No. 04688650
mconner@hirschwest.com
William “Pat” Huttenbach
State Bar No. 24002330
phuttenbach@hirschwest.com
Jacob M. Stephens
State Bar No. 24066143
jstephens@hirschwest.com
1415 Louisiana, 36th Floor
Houston, Texas 77002
Telephone: (713) 220–9162
Facsimile: (713) 223–9319

ATTORNEYS FOR
APPELLEE/CROSS APPELLANT,
PROSPERITY BANK

16
20090252.20140460/2125761.1
 CERTIFICATE OF COMPLIANCE

I do hereby certify that the relevant contents of this document
consist of 3,279 words, in compliance with Tex. R. App. P. 9.4(i) and this
document complies with the typeface requirements of Tex. R. App. P.
9.4(e) because it has been prepared in a proportionally spaced typeface
using Microsoft Word 2013 in 14 point Goudy Old Style font.

/s/ Michael D. Conner
Michael D. Conner

CERTIFICATE OF SERVICE

On the 25th day of March, 2015, the foregoing document was served
pursuant to Rule 21a of the Texas Rules of Civil Procedure as indicated
below:

J. Steven Stewart
5353 West Alabama, Suite 605
Houston, Texas 77056
E–mail: jss@jstevenstewart.com
Via E–Service

/s/ Michael D. Conner
Michael D. Conner

17
20090252.20140460/2125761.1
 N O . 01–14–00997–CV

In the First Court of Appeals
Houston, Texas

Perry D. Felix d/b/a Han’s Laser Technology Co., Appellant

v.

Prosperity Bank, Appellee

From the 164th District Court, Harris County, Texas
Cause No. 2013–50191

APPENDIX

Final Judgment signed November 14, 2014 ........................................ Tab 1
Deposit Account Terms and Conditions (Royal Oaks Bank)
(for legibility: CR.32–33 as attached to Felix’s Original Petition;
SuppCR.92–93 as attached to Prosperity’s Motion for Summary
Judgment) ........................................................................................ Tab 2

Deposit Account Terms and Conditions (Prosperity Bank)
(for legibility: CR.35–40 as attached to Felix’s Original Petition;
SuppCR.95–100 as attached to Prosperity’s Motion for Summary
Judgment) ........................................................................................ Tab 3

18
20090252.20140460/2125761.1
Tab 1
 ,(I)
/3-5öt ql (1)
NO.20r3-50191

PERRY D. FELIX DIB/A HAN'S LASER s IN THE DIS'I'RICT COURT OF
TECHNOI-OCY CO. s
$
$ FIARRIS COLINTY. TEXAS
V $
$
/b,/41
PROSPERITY BANK ANd PROSPERJTY $ I 64'TH JUDIcIAL DISTRICT
BANCSHA,RES,INC

SUMMARY JITDGMENT

On th¡s day came on to be heard Defendant Prospenty Bank's onginal Motion for

Summary Judgment and Supplement to its previously fìled Motron for Summary Judgment on all

claims by and bchveen Plaintiff and Prosperity Bank For the rea.sons stated in sard Motion and

Supplement, thrs Court grants a sumrnary ludgrnent in favor of Prosperity Bank on all of

PlainnfPs clarms agarnst Prosperity Bank and on all of Prosperity Bank's claims against

Plaintiff. Pla¡nttffhas produced no evldence to the contrary.

IT IS THEREFORE, ORDERED, ADJUDGED AND DECREED thAt PIAiNtiff, PETry D

Felix d/b/a Han's Laser Technology Co ("Plaintiff' and/or "Felix"), shall take nothtng on

PlalntifPs clarms against Prosperity Bank.

-Ì?rs-A-bso'oRDE@
jrrd enrY

-Þetlars ($2 l, 5 00.00), fs+-Prespc+t

-Êxp€n€ets

I@DJUn/.IE f
and

any

FHE,EÐ
Chns Daniel
20090252 201 404601tt29592 2 Distnct Clerk
Nov I q 2u4

Bv
Deputy
--+rcsænty Be-k is award@O00 in additlonal renqnnå,ble anrl necessaryt

. atto¡a^eys.feesJosts- ard-expensesr-and-@@

fro

All relref not expressly granted herein by and betwesn Plaintlff and Prospcrity Bank is

denied. Thrs ludgment finally disposes of all claims by and between Plarntiff and Prosperiry

Bank and is appealable This rs meant to be a frnal judgment pursuant to the Texas Supreme

Court's decision inLehmannv Har-ConCorp ,39 S W 3d l9l (Tex 2001).

srgned ontl," J 4aay or Nove)/nfu/f ,2014.

PRESIDING JUDGE
APPROVED AS TO FORM:

Hlnscr & WpsrHEruen, P.C.

By /¡/ Wtllmm P
Wrlliam P. Huttenbach
State Bar No. 24002330
Jaoob M Stephens
State Bar No 24066143
141 5 Louisiana, 3óth Floor
Houston, Texas 77002
(7 t3) 220-9 184 WPH Direct
(7 13) 220-9 125 JMS Direct
(713)223-5181 Matn
(713>223-9319 Fax
ohuttenbach@h trschrvest co¡rt
rstcnhen sâh ¡ rsch rvest.cotrr

ATTORNEYS FOR DEI'ENDANT,
PROSPERITY BA¡IK

2

173
Tab 7
101281201311:53:33 AM 713-755-1451 Pagel I 2
....

ACCOUNT
ROYÀT¿OÀXS BÂNK, gEb-M'AIN OFFICE NUMBÍB
T2OOO I{ESTHETMER RD SUITE lOC
ÂccÕuNT owt\tÉfi(sl NAI*E Ë AODnESS
Hof¡sfÐN, Tx 71t17
PERRY D FEIJIN
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nrrt fû ocdóunl faioÖlÐrl.l T2455 WÐSTPÀ.RK DTI STE G5
trNtFoFM stN{lrg-FAFIY MuLl¡PtE"PÀqTY ofl sEtÊCfiOr'¡
ÊOR*4 NOltCE; ÎlE
TYFÉ OF /qCCOUNI YOU SËLECT ^C60UNÍ
MAV ÐETEflMlNE
Oil YOIJR OEAIH. YOUfi WILL P¡¡1 IÚT
HOUSTС¡ TX 17492
HOW PROPERTY PASSES
coNlRoL THÉ orsPostTtoN oF Fuf.¡os ¡lELo lN soME oÊ THÉ
FOTLO\¡r/t¡rc ACCOU NÏ6,

tr--.- $tNcte-PAÂTY Af,couN'l wlrHouilF'o,o,' lþaysbls on
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n .*-- srNGLt.PAtlTY ÂccouNl wtrH "P,o,o,' lPåvâbla ên INITTÀL O€PO slT I 25, 000.00
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Impn rtant In to rmarìon Regrrdin g F[)IC ! nsu rance Co'r"erage I Nocicc oËFiegarivc Infirrm*tton. -

Fi\STl.tNE Gnidc t Blccr¡oníc FLrndT¡ansfer.t; Ytrur Rlghrs and Responsibilitia 4

Schedule oíFces . 2 Your Al¡iliry to sWithdraw Funds ,
Norice of Your l;inaocial Prìvacy Righrs. 2 Sr¡l¡stitute Ch¿cla a"d You. Righrs 6

Terms rnd CcnrJi¡ion¡ o[Yr¡sr Aecoun.. . ' ;t Btnking Ccntc¡s 6

nccessrry CDs from rh e assurncd t¡nnk arc rçirrarely ' Frcss 3 f¡i¡ Funrlc Trnnsfr'r
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insurance 0rnsu¡lt currcnily ir rtz5o,ooo per the s¡¡nc te¡ln and in thc srmc doll¡r anuun¡ . Prus f for More Optiorx
(Þrlance, Inrøesr, Clungc PIN)
deposiror. 'Ihe szto,ool¡ linrir is pennanenr for (ei¿hcr srith or rvilhout acc.¡uod inrcrcst) continue
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îc=uunts rre fully guanntacd b¡ dre FDIC ñr úre
cn¡ire t¡tr¡unr irr r¡te accolhi. Non"inrcresr-hcaring F¡¡nd.r liansfer Menu
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onril yotr httt selærc¡ì rlrc qpc of infounlrion yuu
Arr-r¡u¡¡!ç (DD^s) u4J imy truroaaiun au.ount ¡vhh a¡rrl have cnrerecl your ¡,r¡unt nutnlrc
' F;æ I ¡o ¡r¡nsfcr Ësm Chc:lting
thrt h¡r¡ .Jnlimited withdtaçrn!¡ rnd 'Jrct cann(tt o Pras 2 rur trunsfe¡ l"rom S*'ings
c¡l interesi, ,ìJso inducled '¡¡t lolv-i¡tenrt NÖtlü Plcæc ltavc your aÉcounr numþcn read¡ $pon + Eore¡ rhe [:rcm f,{Ê¡¡uflt nurnber}
accrx¡nm 0rJüW æcr:u¡ts dtat c¿nnot cifn füùrt enrerìng thcF4$TLINE .rystem. ¡'au rvill be
rhu o.5oYo inrcr*r) ard IOLTR accounts, Corcragc pronrptci{ at follows
under rhe TÉrsacdon Account Gurnntce Progrunr is l. Tq c,Jnrinue in F.nglirh prts l, ar stay on
in rddirion tourtl s+an¡r fror¡¡ rhe curæraË,e avdlsblc
u Prc¡r 2 ro :ransfer To Savinç
rhe line to c¡rntin(re in S¡tranish' u Pre¡ 3 ro ¡nnsler To Lorns
undç rJrc ËDlC ginerlJ dcPosit insunnct n:l*. If
2. Prcss I fu¡ 'Acccunt ln{brm*tiari'; Íls¡s 2
funtls ía r rron-ìnteics¡.hg,rring uattsarrioa lr-rcunt
for "fund¡ Tt¿nslci'. Çlrher no¡es about rrsing FÁ.5ftlNE:
Pte*ing the' kelt reluotsyou mùË prliolls
'
Âruou¡rts t#or¡n¡tio n Mcnr¡ mcßu,
. F¡rss I f+rChccking ,
Pr*sing thc É key tal*er ¡'ou ro dtc m¡în
' Fers ? for S:rvings mânu"
artl the b'¡¡ic deposir imnr.rnce.linrÌr applìes, '. Prr*ç 5 lirrCD .
l(/trcn lirteninB Èo trânsacliùn hriloÐ'. )1st
Press 4 ior !Ri{. can press 7 ro plry rhe prwiot$ (lilrlsÊti(ir1'
Suppitnr*ntal Cowrage for Banlr: Mtrg;rsr \Vhcn . Press i for Loens
I
nvr r¿ uro¡c in¡r¡rel b,rnks rncrgo dcpos.ia fiotn thc r.tr repcnr fhe curmni t¡¡l¡lc¡ion, or 9 to
alúuftl - Chø,:t*iugMenu ;kip io rhc retr tranmctìon,
nt the . P¡a$ I f,¡r Vithd¡arv:rl
the m (Ðehir ¡ncl Chr:ck iuflormation) l{W l'LH tl?/?3/lû Sr\Iìnb)ic [nfonnnrir¡r\C]$¿tsttor¡r

oflPor . Prc¡s 2 for Deposir lnfo¡mation Ër:rm¡ erul Irttrcrdu'cs\F$tiiru\Frrlìnc\Guidr- P*dinc-¡*r

35
101281201311:53:39 AM 713-755-1451 Page3lT

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The fullou'irg fc+ m:y bc.r:.t*d rg,u¡nrI Fû[r ntcount irtd thc follnrvin6tnrrraecion
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in eh ¡'n)i ri1 :g Fknrjs
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a jl'c$s 4 lirr i ill cl* prrr;7
Sr¡rpltnrc*tal Crr?r:reü. fìrr Sürrk]vl+rgtrs: l$hcn t,: plry rhe preriör$-rrc.flsâçrí{tû,
fr+t: ctr trtorv i¡¡.qr¡rtd banirs nrctg*, tlrprr;*t frlm thr
' i\cys J lirr Lo¿ns S tu icpc< ¡l¡ rufrcnr t*nt¿*íoo, or 1l !r¡
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.1r rhÊ Èèr¡ ilr f¡tÐntl* r¡l.L'ì v Pnts\ ! forXr'ilhr:inrrvll
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