New York Party Shuttle, LLC v. John Bilello

Opinion issued February 21, 2013.

In The

Court of Appeals

For The

First District of Texas

————————————

NO. 01-11-01034-CV

———————————

NEW YORK PARTY SHUTTLE, LLC, Appellant

V.

JOHN BILELLO, Appellee

On Appeal from the 151st District Court

Harris County, Texas

Trial Court Case No. 2008-74793

OPINION

Appellant New York Party Shuttle, LLC (NYPS) appeals a judgment entered

against it in favor of appellee John Bilello. Bilello sued NYPS for breaching their

October 2006 settlement agreement. After a bench trial, the trial court found that

NYPS breached the settlement agreement and awarded Bilello $39,900.04, plus

prejudgment interest. In four points of error, NYPS contends that the judgment

should be reversed because (1) it conclusively established the affirmative defenses

of mutual mistake, novation, and repudiation, and (2) the trial court erred in

denying NYPS’s motion for a continuance. Bilello raises one cross-point in which

he contends the trial court erred in denying his request for attorney’s fees. Finding

no reversible error, we affirm.

Background

In 2004, Bilello and Thomas Schmidt started Jersey Shuttle, LLC. The

business plan for the company was to carry passengers from Manhattan to Atlantic

City. Shortly thereafter, Bilello and Schmidt formed a new company, NYPS,

which provided sightseeing tours in New York City. In August 2005, NYPS and

Bilello entered into a separation agreement and Bilello left NYPS to set up a

similar business in San Francisco. After the parties entered into the separation

agreement, NYPS sued Bilello in Harris County, alleging, among other things, that

Bilello misrepresented the financial condition of NYPS while negotiating the

separation agreement. Bilello then sued Schmidt individually, Schmidt’s law

firm, NYPS, and other entities, in New Jersey for, among other things, breach of

fiduciary duty and legal malpractice. The parties attended mediation and

ultimately entered into a settlement agreement and release of all claims on October

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26, 2006. This settlement agreement settled and released all claims between

Bilello, San Francisco Comprehensive Tours, LLC, and the Tour Guide Training

Center (Bilello parties) and NYPS, Jersey Shuttle, LLC, C. Thomas Schmidt,

Schmidt & Hoffer, LLP, Creativerse Internet Systems, LLC, and Washington DC

Party Shuttle, LLC (NYPS parties).

Pursuant to the terms of the settlement agreement, Bilello was to receive

$350,000 from NYPS over a three year period “on behalf of the NYPS Parties . . .

in full satisfaction of all claims against the NYPS Parties.” The parties also agreed

to mutually release all claims or causes of action against the other side. Under the

settlement agreement, Bilello also forfeited his 1,650-unit membership interests in

NYPS and his 650-unit membership interest in Jersey Shuttle, LLC, as well as all

warrants, bonuses, and other undetermined benefits. The settlement agreement

contained mutual noncompete provisions and stated that it could not be modified

or amended except by written instrument signed by all of the parties thereto.

NYPS made timely payments to Bilello under the terms of the settlement

agreement until August 2008. That month, NYPS was scheduled to make a

$20,000 payment. However, NYPS only made a $7,500 payment and failed to pay

the remaining $12,500. Bilello sent a default notice to NYPS regarding the

overdue $12,500. Bilello stated that, in accordance with the terms of the

settlement agreement, he was entitled to pursue remedies and start competing

3

businesses in the restricted areas, but that he would prefer to receive the payment

due. NYPS responded that it would be able to pay the $12,500, but it wanted

Bilello to confirm that there would be no material breach and that all other

provisions of the settlement agreement remain intact if the payment were made on

or before October 13, 2008. NYPS did not receive a response to this

communication, so it sent Bilello another email stating NYPS was prepared to wire

the $12,500 and to continue paying the balance of the amounts agreed to in the

settlement agreement “immediately upon written agreement that there was no

material breach of our agreement and that all of the provisions of that agreement

remain in effect.” In response, Bilello stated that he had no position on NYPS’s

inquiry as to whether there was a material breach, and he suggested that NYPS

make all the required payments. NYPS never paid the $12,500 and failed to make

the majority of the remaining payments due under the settlement agreement.

In the next several weeks, NYPS and Bilello discussed amending the terms

of the settlement agreement. The two main purposes of the contemplated

amendment were to set forth new terms governing the payment of the remaining

balance owed to Bilello under the settlement agreement and to extend the

noncompete agreement until 2012. The other terms of the settlement agreement

were to remain the same. While the parties seemingly reached agreement on the

amendment in principle, their email communications reflect that they intended the

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amendment to become effective upon the execution of a new written agreement

reflecting the new terms. However, neither party ever executed a writing

modifying the terms of the settlement agreement.

Bilello ultimately sued NYPS for breach of contract based on NYPS’s

failure to make the required payments under the settlement agreement. It was

undisputed that, at the time Bilello’s lawsuit was filed, NYPS had failed to pay

$39,900.04 due under the settlement agreement. NYPS answered and raised

several affirmative defenses, including mutual mistake, novation, and repudiation.

Following a one-day bench trial, the trial court rejected NYPS’s affirmative

defenses, and found that NYPS breached the settlement agreement. It awarded

Bilello damages in the amount of $39,900.04 plus prejudgment interest. NYPS

appeals.

Discussion

A. NYPS’s Affirmative Defenses

In its first three issues, NYPS argues that it conclusively proved its

affirmative defenses of mutual mistake, novation, and repudiation. We construe

these issues as challenges to the legal sufficiency of the evidence to support the

trial court’s adverse findings on those affirmative defenses.

In an appeal from a bench trial, the trial court’s findings of fact have the

same weight as a jury verdict. Catalina v. Blasdel, 881 S.W.2d 295, 297 (Tex.

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1994); Nguyen v. Yovan, 317 S.W.3d 261, 269–70 (Tex. App.—Houston [1st Dist.]

2009, pet. denied). We review a trial court’s findings of fact under the same legal

sufficiency of the evidence standards used when determining whether sufficient

evidence exists to support an answer to a jury question. Catalina, 881 S.W.3d at

297; Nguyen, 317 S.W.3d at 270.

“A party challenging the legal sufficiency of an adverse finding on an issue

on which that party had the burden of proof at trial must demonstrate on appeal

that the evidence conclusively established, as a matter of law, all vital facts in

support of the issue.” RM Crowe Prop. Servs. Co., L.P. v. Strategic Energy,

L.L.C., 348 S.W.3d 444, 448 (Tex. App.—Dallas 2011, no pet.). We consider the

legal sufficiency of the evidence in the light most favorable to the prevailing party,

according every reasonable inference in that party’s favor and disregarding

contrary evidence unless a reasonable factfinder could not. City of Keller v.

Wilson, 168 S.W.3d 802, 827 (Tex. 2005); Tricon Tool & Supply, Inc. v. Thumann,

226 S.W.3d 494, 500–01 (Tex. App.—Houston [1st Dist.] 2006, pet. denied). “If

there is any evidence of probative force to support the finding, i.e., more than a

mere scintilla, we will overrule the issue.” City of Houston v. Hildebrandt, 265

S.W.3d 22, 27 (Tex. App.—Houston [1st Dist.] 2008, pet. denied) (citing Haggar

Clothing Co. v. Hernandez, 164 S.W.3d 386, 388 (Tex. 2005)). If no evidence

supports the adverse finding, we examine the entire record to determine if the

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contrary position is established as a matter of law. Dow Chem. Co. v. Francis, 46

S.W.3d 237, 241 (Tex. 2001). The issue will be sustained only if the contrary

proposition is conclusively established. Id.

1. Mutual Mistake

In its first point of error, NYPS argues that the evidence at trial conclusively

established that it agreed to pay Bilello $350,000 under the settlement agreement

based on the parties’ mutually mistaken belief that $350,000 was the reasonable

value of Bilello’s shares in NYPS. According to NYPS, because of later-

discovered errors made in the computation of workers’ compensation costs, payroll

and local taxes, and maintenance costs, the value of the company—and thus, the

value of Bilello’s interest in it—was significantly less than the parties thought at

the time they entered into the settlement agreement.

In response, Bilello argues that NYPS failed to show that the parties’ true

agreement was incorrectly reflected in the settlement agreement or that they shared

the same mistaken belief as to a material fact. Bilello contends that, at best, the

evidence demonstrated that NYPS failed to accurately appraise its financial

condition at the time the parties entered into the settlement agreement.

The elements of mutual mistake are: (1) a mistake of fact; (2) held mutually

by the parties; (3) which materially affects the agreed-on exchange. City of The

Colony v. N. Tex. Mun. Water Dist., 272 S.W.3d 699, 735 (Tex. App.—Fort Worth

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2008, pet. dism’d). A mutual mistake of fact occurs when the parties to an

agreement have a common intention, but the written agreement does not accurately

reflect that intention due to a mutual mistake. See Smith-Gilbard v. Perry, 332

S.W.3d 709, 713 (Tex. App.—Dallas 2011, no pet.); City of The Colony, 272

S.W.3d at 735. When mutual mistake is alleged, the party seeking relief must

show what the parties’ true agreement was and that the instrument incorrectly

reflects that agreement because of a mutual mistake. Atlantic Lloyds Ins. Co. v.

Butler, 137 S.W.3d 199, 213 (Tex. App.—Houston [1st Dist.] 2004 pet. denied).

Under the doctrine of mutual mistake, when parties to an agreement have

contracted under a misconception or ignorance of a material fact, the agreement

will be voided. Walden v. Affiliated Computer Servs., Inc., 97 S.W.3d 303, 326

(Tex. App.—Houston [14th Dist.] 2003, pet. denied).

To prove a mutual mistake, the evidence must show that both parties were

acting under the same misunderstanding of the same material fact. Id. A unilateral

mistake by one party, combined with knowledge of that mistake by the other party,

is equivalent to mutual mistake. Davis v. Grammer, 750 S.W.2d 766, 768 (Tex.

1988). But, “[a] mistake by only one party to an agreement, not known or induced

by acts of the other party[,] will not constitute grounds for relief.” Smith-Gilbard,

332 S.W.3d at 713–14 (quoting Johnson v. Snell, 504 S.W.2d 397, 399 (Tex.

1974)). Mutual mistake should not be available to avoid the results of an unhappy

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bargain. Williams v. Glash, 789 S.W.2d 261, 265 (Tex. 1990). Parties should be

able to rely on the finality of freely bargained agreements. Id.

Here, the record supports the trial court’s finding that NYPS failed to

conclusively establish a mutual mistake. The record does not conclusively show

that the $350,000 amount agreed to in the settlement agreement was the

consideration for Bilello’s shares in NYPS and nothing more. Despite NYPS’s

contention to the contrary, there was evidence indicating the payment of $350,000

was consideration for not only the value of Bilello’s interest in NYPS, but also for

Bilello’s interest in Jersey Shuttle and his agreement to release his claims against

all of the NYPS parties. Indeed, the payments to Bilello were made on behalf of

all of the NYPS parties, not just NYPS.

Furthermore, NYPS has failed to establish the existence of a mutual mistake.

Bilello left NYPS in October 2005, one year before the parties signed the

settlement agreement. During that year, Bilello was working in San Francisco and

did not have access to the financial records of NYPS. At trial, Bilello testified that

he had no independent knowledge of the financial condition of NYPS after he left

the company and that he and his attorney relied on Schmidt’s statements on that

topic during the settlement negotiations, while Schmidt was in charge of the

company and was knowledgeable about NYPS’s financial condition. This

evidence, at best, supports a conclusion that Schmidt mistakenly evaluated the

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financial condition of NYPS in deciding how much Bilello’s interest in NYPS was

worth. See Walden, 97 S.W.3d at 326 (mutual mistake requires misunderstanding

of same material fact by both parties). Schmidt made no showing that adequate

financial information was not made available to him. And there was no evidence

introduced that Bilello was aware Schmidt had made a mistake in evaluating the

value of Bilello’s interest in NYPS. See Atlantic Lloyds, 137 S.W.3d at 213

(holding record did not support finding of mutual mistake or unilateral mistake

because there was no evidence that plaintiffs made mistake as to terms of

settlement agreement and that defendants were aware of this mistake).

We conclude there is more than a scintilla of evidence to support the trial

court’s finding that NYPS failed to prove its affirmative defense of mutual

mistake. See Hildebrandt, 265 S.W.33d at 27. Therefore, we overrule NYPS’s

first point of error.

2. Novation

In its second point of error, NYPS argues that the evidence conclusively

demonstrated the formation of a new contract modifying the terms of the

settlement agreement. According to NYPS, once this valid new agreement was

formed, the settlement agreement was extinguished and Bilello was no longer

permitted to sue to enforce it. Bilello responds that the trial court did not err by

rejecting NYPS’s novation defense because the evidence clearly demonstrates both

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parties intended that the new agreement would be effective only after it was

signed, and it never was signed.

NYPS contends the novation was accomplished in an email exchange

between Schmidt and Bilello. In it, Schmidt and Bilello discussed entering into a

new agreement to modify the terms under which NYPS would pay the balance

under the settlement agreement and to extend the noncompete agreement until

2012. They also discussed leaving the other terms of the original settlement

agreement intact. After agreeing to these terms in principle via email, Schmidt

forwarded the proposed new written agreement to Bilello for review. Bilello

reviewed it and asked Schmidt to fix some typos and resend it so the parties could

execute the final version contemporaneously and exchange completed signed

versions of the agreement by fax. Bilello’s email read: “Okay, everything looks

good. Go ahead and fix those typos and then I propose we sign and fax the same

time—tomorrow 12pm PT? If not, what day/time?” The parties apparently did not

execute the new agreement as Bilello proposed. Approximately a week later,

Schmidt emailed Bilello, “I need that document signed asap if we’re going to make

a wire on the 10th.”

Novation is the substitution of a new agreement between the same parties or

the substitution of a new party on an existing agreement. Honeycutt v. Billingsley,

992 S.W.2d 570, 576 (Tex. App.—Houston [1st Dist.] 1999, pet. denied). Where a

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novation occurs, only the new agreement may be enforced. Id. To establish a

novation, the party raising the defense must prove: (1) the existence of a previous,

valid obligation; (2) a mutual agreement of the parties to a new contract; (3) the

extinguishment of the old contract; and (4) the validity of the new contract. RM

Crowe Prop., 348 S.W.3d at 448 (citing Vickery v. Vickery, 999 S.W.2d 342, 356

(Tex. 1999)).

“Evidence of mutual assent in written contracts generally consists of

signatures of the parties and delivery with the intent to bind.” Baylor Univ. v.

Sonnichsen, 221 S.W.3d 632, 635 (Tex. 2007). Whether a written contract is

signed is relevant to a determination of whether the contract is binding on the

parties. In re Bunzl USA, Inc., 155 S.W.3d 202, 209 (Tex. App.—El Paso 2004, no

pet.). Parties may provide that the signature of each party is a prerequisite to a

binding written contract. Id. (citing ARTHUR LINTON CORBIN, CORBIN ON

CONTRACTS § 2.10, at 165 (Joseph M. Perillo rev. 1993)). Where parties to a

written contract intend that it shall not be binding until it is signed by the parties,

the signatures of both parties are required to give effect to the contract. See

Simmons & Simmons Constr. Co. v. Rea, 286 S.W.2d 415, 418–19 (Tex. 1955);

Birchminster Resources v. Corpus Christi Management Co., 517 S.W.2d 608, 611

(Tex. App.—Corpus Christi 1974, writ dism’d). Therefore, “the question of

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whether a written contract must be signed to be binding is a question of the parties’

intent.” In re Bunzl, 155 S.W.3d at 209.

In Simmons, the Texas Supreme Court considered whether the parties were

bound by a written instrument that was signed by only one party. There, a general

contractor and a subcontractor orally discussed and agreed to the essential terms of

a subcontract and, immediately following this discussion, the general contractor

reduced the agreement to writing. Simmons, 286 S.W.2d at 416. The written

instrument contained a signature block and was delivered to the subcontractor with

instructions to sign the instrument, obtain a bond, and return the signed instrument,

along with the bond, so the general contractor could then sign it. Id. After the

subcontractor followed these instructions, the general contractor returned the bond

and the instrument unsigned to the subcontractor, “stating that it would be

impossible for [the general contractor] to enter into the contractual agreement.” Id.

The subcontractor sued the general contractor and the jury determined that the

parties intended for the written instrument to become binding regardless of whether

it was signed by both parties. Id.

Noting that the written instrument provided places for the signatures of both

parties, required the signatures of both parties in connection with the furnishing of

a performance bond, and was delivered to the subcontractor with the specific

instructions to sign it, obtain the bond, and return it to the general contractor for

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signature, the Supreme Court concluded that the general contractor intended that

the instrument be signed by both parties as a condition precedent to his assent to

the contract. Id. at 418–19. The Court found there was nothing in the general

contractor’s actions that could “reasonably give[] rise to the inference that he

intended to assent to the instrument in the absence of the signatures of the parties

or that he intended to waive signing as a condition of such assent.” Id. at 419; see

also In re Bunzl, 155 S.W.3d at 211–12 (relying on blank signature blocks in

arbitration agreement as well as provision requiring modifications or amendments

to agreement to be signed by all parties as evidence of parties’ intent, court held

that employer did not establish existence of valid arbitration agreement because

parties did not intend to be bound until both parties signed agreement).

Even assuming that NYPS conclusively established some elements of

novation, NYPS did not conclusively prove the validity of the new contract

because the evidence shows the parties intended for it to become binding upon

signing, but neither party ever signed. NYPS relies heavily on Bilello’s email to

Schmidt, in which Bilello noted his assent to the new agreement by typing the

word “[d]one,” in response to Schmidt’s proposal. According to NYPS, this is

enough to conclusively establish novation. But this overlooks the evidence that

both parties viewed signatures as a condition precedent to a new binding

agreement: (1) the email exchange indicating the parties planned to sign

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contemporaneously and exchange executed versions of the agreement; and (2)

Schmidt’s testimony that he was reminding Bilello to sign the document because

he needed to know if they were going forward with the agreement or not. With

respect to the latter, Schmidt testified that “in light of [Bilello’s] prior behavior I

wanted to make sure I had that confirmation before I wired the money.”

Furthermore, the settlement agreement stated that it could not be “modified or

amended except by an instrument in writing signed by all of the Parties hereto.”

This evidence demonstrates that both parties intended signatures to be a condition

precedent to a valid, new agreement. See Simmons, 286 S.W.2d at 418–19; In re

Bunzl, 155 S.W.3d at 211–12. Therefore, we conclude that the evidence is legally

sufficient to support the trial court’s finding that signatures were required before a

new agreement was formed and, thus, NYPS failed to conclusively establish its

affirmative defense of novation. See RM Crowe Prop., 348 S.W.3d at 448–49.

We overrule NYPS’s second point of error.

3. Repudiation

In its third point of error, NYPS argues that it conclusively established its

affirmative defense of repudiation by proving Bilello refused to provide reasonable

assurance to NYPS that the settlement agreement was still in effect after NYPS

failed to make the full August 2008 payment. NYPS contends that Bilello’s

statement that he was entitled to compete and accelerate the remaining payments

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excused NYPS from further performance of its obligations under the settlement

agreement unless and until Bilello provided reasonable assurances that the

agreement was still binding on Bilello. 1 In response, Bilello maintains he never

repudiated the agreement, and that it was NYPS that committed the first breach by

failing to make the full August 2008 payment.

“[W]hen one party to a contract commits a material breach of that contract,

the other party is discharged or excused from further performance.” Henry v.

Masson, 333 S.W.3d 825, 840 (Tex. App.—Houston [1st Dist.] 2010, pet. denied).

If the non-breaching party continues to insist on performance by the party in

default, the previous breach by the breaching party is not an excuse for

nonperformance by the non-breaching party and the contract continues in full

force. Id. The non-breaching party, therefore, must choose between continuing

performance and ceasing performance. Id.

Repudiation or anticipatory breach is an unconditional refusal to perform the

contract in the future, which can be expressed either before performance is due or

1

Citing no authority, NYPS also argues that its failure to pay the entire $20,000

August 2008 payment was not a material breach of the settlement agreement.

NYPS did not assert this argument in the trial court and did not adequately brief

this issue on appeal. Nevertheless, we note that the settlement agreement defined

default as the “default or delinquency of any payment obligation set forth on

Exhibit A to this Agreement that is not cured within 15 days of written notice

provided by Bilello.” The failure to make a complete payment when due under a

contract may constitute a material breach. See, e.g., Deep Nines, Inc. v. McAfee,

Inc., 246 S.W.3d 842, 846 (Tex. App.—Dallas 2008, no pet.)

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after partial performance. Van Polen v. Wisch, 23 S.W.3d 510, 516 (Tex. App.—

Houston [1st Dist.] 2000, pet. denied). “To constitute a repudiation or anticipatory

breach, the party to the contract must have absolutely repudiated the contract

without just cause.” Id. Because NYPS asserted repudiation as an affirmative

defense, NYPS had the burden of proving that Bilello unconditionally refused to

perform the contract. See El Paso Prod. Co. v. Valence Operating Co., 112

S.W.3d 616, 622 (Tex. App.—Houston [1st Dist.] 2003, pet. denied).

Here, the trial court found that NYPS breached the settlement agreement

when it failed to make the entire $20,000 payment in August 2008 and that Bilello

was entitled to ask for NYPS to make the payments it was required under the

contract without this being considered an anticipatory breach.

The record supports the trial court’s findings that NYPS breached and

Bilello did not unconditionally refuse to perform. NYPS paid only $7,500 of the

$20,000 payment due to Bilello in August 2008. After NYPS’s breach, Bilello

informed NYPS that, based on the breach, he was entitled to begin operating a

business in the restricted areas, i.e., consider the agreement beached and cease his

own performance. However, he also stated that he would rather be paid and he

could work with NYPS on the payment date as long as the delay would not be for

more than another few days. NYPS refused to pay the remaining $12,500 until it

received confirmation from Bilello that there was no material breach and all

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remaining provisions of the settlement agreement would remain intact. This

evidence does not conclusively establish an unconditional refusal by Bilello to

perform the contract in the future. See Van Polen, 23 S.W.3d at 516. Therefore,

we conclude that the evidence is legally sufficient to support the trial court’s

findings and NYPS failed to conclusively establish its defense of repudiation.

Accordingly, we overrule NYPS’s third point of error.

B. Motion for Continuance

In its fourth point of error, NYPS contends the trial court abused its

discretion by refusing to grant its motion for continuance based, in part, on the

unavailability of a potential witness, Stephen Ripp, the chief financial officer of

NYPS. According to NYPS, Ripp participated in the settlement negotiations that

resulted in the 2006 settlement agreement and would have testified that the

payment to Bilello under the settlement agreement was in consideration for his

interest in NYPS and that the information relied upon by both sides in calculating

that value was materially incorrect. NYPS contends it was unable to reach Ripp

for trial, despite its diligent attempts. Thus, NYPS maintains that it established

good cause for a continuance and the trial court abused its discretion by refusing to

grant the motion. In response, Bilello contends that the trial court did not abuse its

discretion by denying NYPS’s motion because the motion did not comply with the

requirements of Texas Rule of Civil Procedure 252.

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We review a trial court’s denial of a motion for continuance for an abuse of

discretion. See Moreno v. Perez, 363 S.W.3d 725, 745 (Tex. App.—Houston [1st

Dist.] 2011, no pet.). The absence of a material witness provides sufficient cause

for a continuance, but only if the party requesting the continuance has exercised

proper diligence to procure the testimony of the witness. Daughtery v. Jacobs, 187

S.W.3d 607, 619 (Tex. App.—Houston [14th Dist.] 2006, no pet.). Rule 252

provides as follows:

If the ground of such application be the want of testimony, the party

applying therefor shall make affidavit that such testimony is material,

showing the materiality thereof, and that he has used due diligence to

procure such testimony, stating such diligence, and the cause of

failure, if known; that such testimony cannot be procured from any

other source; and, if it be for the absence of a witness, he shall state

the name and residence of the witness, and what he expects to prove

by him; and also state that the continuance is not sought for delay

only, but that justice may be done; provided that, on a first application

for a continuance, it shall not be necessary to show that the absent

testimony cannot be procured from any other source.

TEX. R. CIV. P. 252. A trial court does not abuse its discretion by denying a motion

for continuance that does not meet the requirements of Rule 252. Wal-Mart Stores

Tex., LP v. Crosby, 295 S.W.3d 346, 356 (Tex. App.—Dallas 2009, pet. denied)

(citing Pape v. Guadalupe-Blanco River Auth., 48 S.W.3d 908, 914 (Tex. App.—

Austin 2001, pet. denied)).

Here, NYPS moved for a continuance because “[a] critical witness in this

matter, Stephen J. Ripp, who is expected to offer necessary testimony in regard to

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the mutual mistake involving the facts underlying the contract which is the basis of

this lawsuit, has been unreachable, and unresponsive to multiple attempts to

contact him and messages left for him.” Although NYPS generally describes Ripp

as a “critical witness” who would provide “necessary testimony” relating to its

defense of mutual mistake, there is nothing in the motion or affidavit stating what

it expects to prove by Ripp’s testimony, as is required by Rule 252. NYPS’s

reasoning provided in its appellate brief of what it expected to prove through

Ripp’s testimony—that Ripp would testify the payment to Bilello was for a

repurchase of his shares, the value of those shares was the basis for the purchase,

and the information relied on by both sides in calculating that number was

materially incorrect—was not included in its motion for continuance or the

affidavit. Additionally, NYPS failed to include Ripp’s address in its motion, which

is also required by Rule 252.

NYPS also failed to demonstrate that it exercised due diligence in procuring

Ripp’s testimony. There is nothing in the record to suggest that NYPS subpoenaed

Ripp or took or attempted to take his deposition at any point from the time the

original petition was filed in December 2008 until trial in July 2011. Nor did

NYPS explain in its motion or affidavit why it could not have done so. For these

reasons, we conclude that the trial court did not abuse its discretion by denying

NYPS’s motion for continuance. See Lynd v. Wesley, 705 S.W.2d 759, 764 (Tex.

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App.—Houston [14th Dist.] 1986, no writ) (affirming trial court’s denial of motion

for continuance and holding appellant failed to comply with requirements of Rule

252 where appellant did not allege materiality of witness’s testimony or explain

what he sought to prove by testimony, and failed to subpoena witness or take

deposition and provided no reasons why he could not have done so); see also

Daugherty, 187 S.W.3d at 619 (upholding trial court’s denial of motion for

continuance in part because appellant failed to show absent witness’s testimony

could not have been taken by deposition); Stiles v. Royal Ins. Co. of Am., 798

S.W.2d 591, 596–97 (Tex. App.—Dallas 1990, writ denied) (holding appellant did

not use due diligence to obtain testimony from witness through subpoena or

deposition).

We overrule NYPS’s fourth point of error.

C. Bilello’s Cross-Point on Attorney’s Fees

In his sole cross-point, Bilello contends the trial court erred in denying his

request for attorney’s fees. He requests that this court reverse the judgment of the

trial court and remand for an evidentiary hearing to determine the amount of

attorney’s fees that should be awarded to him. NYPS responds that this court

should not consider Bilello’s cross-point because he failed to file a notice of appeal

from the trial court’s judgment.

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Under Rule 25.1 of the Texas Rules of Appellate Procedure, any “party who

seeks to alter the trial court’s judgment . . . must file a notice of appeal.” TEX. R.

APP. P. 25.1(c). Unless a party seeking to alter a trial court’s judgment files a

notice of appeal of its own, the appellate court is not permitted to grant more

favorable relief than the trial court except for just cause. Id.; see also Brooks v.

Northglen Ass’n, 141 S.W.3d 158, 171 (Tex. 2004); Dean v. Lafayette Place

(Section One) Council of Co-Owners, Inc., 999 S.W.2d 814, 818 (Tex. App.—

Houston [1st Dist.] 1999, no pet). In Dean, this court further explained:

If an appellee is satisfied with the relief granted by the trial court, but

merely wants to present additional, independent grounds for affirming

the trial court’s judgment, no notice of appeal is required. The

independent grounds for affirmance can be raised in a cross-point as

long as the appellee is not requesting greater relief than that awarded

by the trial court.

Dean, 999 S.W.2d at 818. Several courts have applied this rule in holding that an

appellee waived cross-issues by failing to file a notice of appeal. See, e.g., Brooks,

141 S.W.3d at 171 (holding appellee’s challenge to portion of trial court’s

judgment was not preserved for appellate review because appellee, as party who

sought to alter trial court’s judgment, did not file notice of appeal from trial court’s

judgment); Lubbock Cnty. v. Trammel’s Lubbock Bail Bonds, 80 S.W.3d 580, 586

(Tex. 2002) (holding that county seeking to alter trial court’s partial summary

judgment waived this challenge by failing to file notice of appeal); Cities of Allen

v. R.R. Comm’n of Tex., 309 S.W.3d 563, 576 (Tex. App.—Austin 2010), aff’d in

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part, rev’d on other grounds, Atmos Energy Corp. v. Cities of Allen, 353 S.W.3d

156 (Tex. 2011) (holding that appellee’s cross-point, which did not present

alternative basis for affirming judgment but sought holding that trial court erred in

issuing one of its conclusions of law, was not properly before court because

appellees sought more favorable relief than was given in trial court and appellees

did not file notice of appeal); Granado v. Meza, 360 S.W.3d 613, 616 (Tex.

App.—San Antonio 2011, pet. filed) (holding that appellee, who challenged in

cross-point trial court’s finding that statute of limitations on child support had not

yet run, waived his right to raise cross point because appellee did not file notice of

appeal); Small v. Specialty Contractors, Inc., 310 S.W.3d 639, 642–43 (Tex.

App.—Dallas 2010, no pet.) (holding that appellees were precluded from raising

argument on appeal that trial court erred in dismissing, rather than staying case,

because they were seeking more favorable relief than given in trial court and failed

to file notice of appeal). And, the Fourteenth Court of Appeals, noting that it could

not grant the appellee more favorable relief than the trial court in the absence of a

notice of appeal, has specifically declined to address an appellee’s cross-point

asserting an entitlement to attorney’s fees as the prevailing party under a lease

where the appellee failed to file a notice of appeal. See CHCA E. Houston, L.P. v.

Henderson, 99 S.W.3d 630, 636 (Tex. App.—Houston [14th Dist.] 2003, no pet.).

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In his cross-point, Bilello does not present an “additional, independent

ground[] for affirming the trial court’s judgment.” Dean, 999 S.W.3d at 818; see

also Cities of Allen, 309 S.W.3d at 576. Rather, he alleges that the trial court

reversibly erred in excluding testimony relating to attorney’s fees and refusing to

award attorney’s fees and requests that this court reverse and remand for an

evidentiary hearing on the amount of attorney’s fees to be awarded. We hold that

Bilello is seeking to alter the trial court’s judgment and obtain more relief than the

trial court granted him; therefore, he was required to file a notice of appeal. See

Cities of Allen, 309 S.W.3d at 576; Small 310 S.W.3d at 642–43; CHCA E.

Houston, 99 S.W.3d at 636.

Conclusion

We conclude that the trial court did not err in rejecting NYPS’s affirmative

defenses of mutual mistake, novation, and repudiation. We also conclude the trial

court did not abuse its discretion by denying NYPS’s motion for a continuance.

Finally, Bilello failed to file a notice of appeal from the trial court’s judgment;

therefore, he waived his right to raise his cross-point relating to the trial court’s

failure to award attorney’s fees. Accordingly, we affirm the trial court’s judgment.

Rebeca Huddle

Justice

Panel consists of Justices Keyes, Sharp, and Huddle.

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