# Noah S. Bunker, Paul Carrell, Everett Brew Houston, Jr., W. Andrew Buchholz, Scott J. Leighty, Jad L. Davis, and Holly Clause v. Tracy D. Strandhagen > Texas Court of Appeals, 3rd District (Austin) · March 16, 2015 URL: https://www.frixlaw.com/law-library/cases/4059716 ## Case - **Court:** Texas Court of Appeals, 3rd District (Austin) - **Decided:** March 16, 2015 - **Precedential status:** Published - **Opinion:** Opinion - **Cited by:** 0 later opinions in the Frix Law Library ## Citator (automated) - No negative treatment found by the automated citator. That is not the same as a confirmation that the case is good law; read the citing cases. - Full citator and citing cases: https://www.frixlaw.com/law-library/cases/4059716 ## How later opinions describe it (automated extraction) - reversing judgment for plaintiff on contract claim and declining to remand for consideration of equitable and just attorney's fees under UDJA when plaintiff's additional request for declaratory relief was unnecessary and improper - holding attorney's affidavit sufficient to warrant summary judgment when it (1) contained recitals establishing attorney's competency to swear to facts stated and other requirements of Rule of Civil Procedure 166a(f), (2) described work encompassed by the fees sought, and (3 - rejecting the view that the government must bring suit in order for litigation to involve “public rights” ## Opinion text ACCEPTED 03-14-00510-CV 4519217 THIRD COURT OF APPEALS AUSTIN, TEXAS 3/16/2015 4:59:06 PM ____________________________________________ JEFFREY D. KYLE CLERK No. 03-14-00510-CV _____________________________________________ FILED IN 3rd COURT OF APPEALS AUSTIN, TEXAS IN THE COURT OF APPEALS 3/16/2015 4:59:06 PM THIRD JUDICIAL DISTRICT OF TEXAS JEFFREY D. KYLE AT AUSTIN Clerk _______________________________________________ Noah S. Bunker, Paul Carrell, Everett Brew Houston, Jr., W. Andrew Buchholz, Scott J. Leighty, Jad L. Davis, and Holly Clause, Appellants v. Tracy D. Strandhagen, Appellee FROM THE DISTRICT COURT OF TRAVIS COUNTY, 353RD JUDICIAL DISTRICT, CAUSE NO. D-1-GN-13-002811, THE HONORABLE ORLINDA NARANJO PRESIDING APPELLANTS’ REPLY BRIEF Amanda G. Taylor ataylor@textaxlaw.com Texas Bar No. 24045921 MARTENS, TODD, LEONARD, TAYLOR & AHLRICH 301 Congress Avenue, Suite 1950 Austin, Texas 78701 Tele: (512) 542-9898 Fax: (512) 542-9899 ORAL ARGUMENT REQUESTED TABLE OF CONTENTS TABLE OF CONTENTS .................................................................................. i INDEX OF AUTHORITIES .......................................................................... iii REPLY ARGUMENT ..................................................................................... 1 I. Strandhagen Failed to Conclusively Establish Element Two: “Unreasonable Forecast.” ........................................................ 2 A. General Rule: Proof of Actual Damages is Required. ................................................................................ 3 1. It is undisputed that Strandhagen offered no proof of actual damages............................................ 5 B. Narrow Exceptions: Two Types of Facial Invalidity. ................................................................................ 5 1. Multiplier of actual damages: ........................................ 6 2. One size fits all: ............................................................. 8 a. Strandhagen failed to prove that this is a facially invalid “one size fits all” provision. ............................................................. 9 C. Conclusion on “Unreasonable Forecast.” ............................. 13 II. Additional Reply Arguments:..........................................................15 A. Arguments Made in the Physicians’ Motion for New Trial Were Preserved for Review. ..................................15 B. The Physicians “Modification” Argument Was Not an Affirmative Defense. ........................................................ 16 C. Strandhagen Cannot Use the Declaratory Judgment Act to Create Jurisdiction. ................................... 18 i PRAYER ...................................................................................................... 21 CERTIFICATE OF COMPLIANCE .............................................................. 22 CERTIFICATE OF SERVICE....................................................................... 23 ii INDEX OF AUTHORITIES CASES Ayeni v. State, 440 S.W.3d 707 (Tex. App.—Austin 2013, no pet.) ............................15 Bethel v. Butler Drilling Co., 635 S.W.2d 834 (Tex. Civ. App.—Houston [14th Dist.] 1982, writ ref'd n.r.e.) .................................................................................... 8 CDS Enters., Inc. v. Myrad Real Estate, Inc., No. 14-97-00197-CV, 1999 WL 548226, (Tex. App.—Houston [14th Dist.] 1999, no pet.) .................................................................... 4 Chan v. Montebello Dev. Co., No. 14-06-00936-CV, 2008 WL 2986379 (Tex. App.—Houston [14th Dist.] 2008, pet. denied) ............................................................ 4 Charbonnet v. Shami, No. 04-12-00711-CV, 2013 WL 2645720 (Tex. App.—San Antonio 2013, pet. denied) ...............................................................................15 Chenault v. Phillips, 914 S.W.2d 140 (Tex. 1996) ............................................................... 19 Community Dev. Serv., Inc. v. Replacement Parts Mfg., Inc., 679 S.W.2d 721 (Tex. App.—Houston [1st Dist.] 1984, no writ)........................................................................................... 8, 12 Devon Energy Prod. Co. v. KCS Res., LLC, 450 S.W.3d 203 (Tex. App.—Houston [14th Dist.] 2014, pet. filed on other grounds) ............................................................... 18 Dunlap v. Gayle, No. 13-12-00105-CV, 2013 WL 1500377 (Tex. App.—Corpus Christi 2013, no pet.) ....................................................................................... 7 iii Eberts v. Businesspeople Personnel Servs., Inc., 620 S.W.2d 861 (Tex. App.—Dallas 1981, no writ) ............................ 13 FPL Energy, LLC v. TXU Portfolio Mgmt. Co., LP, 426 S.W.3d 59 (Tex. 2014)................................................................... 6 Garden Ridge, L.P. v. Advance Int’l, Inc., 403 S.W.3d 432(Tex. App.—Houston [14th Dist.] 2013, pet. denied) ...................................................................................... 3, 4 GPA Holding, Inc. v. Baylor Health Care Sys., 344 S.W.3d 467 (Tex. App.—Dallas 2011, pet. denied) ........................ 3 Healix Infusion Therapy, Inc. v. Bellos, No. 11-02-00346-CV, 2003 WL 22411873 (Tex. App.—Eastland Oct. 23, 2003, no pet.) ...................................... 3 Hill v. Heritage Res., Inc., 964 S.W.2d 89 (Tex. App.—El Paso 1997, pet. denied) ...................... 17 In re Dow Corning Corp., 419 F.3d 543 (6th Cir. 2005).............................................................. 12 Khan v. Meknojiya, No. 03-11-00580-CV, 2013 WL 3336874 (Tex. App.—Austin 2013, no pet.) ................................................................................................. 7 Magill v. Watson, 409 S.W.3d 673 (Tex. App.—Houston [1st Dist.] 2013, no pet.) ................................................................................................. 7 Mayfield v. Hicks, 575 S.W.2d 571 (Tex. App.—Dallas 1978, writ ref’d n.r.e.) .................. 8 iv Murphy v. Cintas Corp., 923 S.W.2d 663 (Tex. App.—Tyler 1996, writ denied) ........................ 9 Oetting v. Flake, 553 S.W.2d 793 (Tex. App.—Fort Worth 1977, no writ) ...................... 4 Phillips v. Phillips, 820 S.W.2d 785 (Tex. 1991) ......................................................... 3, 6, 7 R. Conrad Moore & Assoc., Inc. v. Lerma, 946 S.W.2d 90 (Tex. App.—El Paso 1997, writ denied) ..................... 12 Southern Union Co. v. CSG Sys., Inc., No. 03-04-00172-CV, 2005 WL 171349 (Tex. App.—Austin Jan. 27, 2005, no pet.) ......................................................................... 3 SP Terrace, L.P. v. Meritage Homes of Texas, LLC, 334 S.W.3d 275 (Tex. App.—Houston [1st Dist.] 2010, no pet.) ................................................................................................ 11 Stewart v. Basey, 245 S.W.2d 484 (Tex. 1952) ................................................................. 8 Taylor v. State Farm Lloyds, Inc., 124 S.W.3d 665 (Tex. App.—Austin, 2003, pet. denied) ................... 19 Tex. Ass’n of Bus. v. Tex. Air Control Bd., 852 S.W.2d 440 (Tex. 1993) .............................................................. 18 Triton 88, L.P. v. Star Elec., LLC, 411 S.W.3d 42 (Tex. App.—Houston [1st Dist.] 2013, no pet.) ............ 3 Urban Television Network Corp. v. Liquidity Solutions, L.P., 277 S.W.3d 917 (Tex. App.—Dallas 2009, no pet.) ......................... 9, 11 v Williams v. Colthurst, 253 S.W.3d 353 (Tex. App.—Eastland 2008, no pet.) ........................ 17 STATUTES & RULES Tex. R. App. P. 9.4 ....................................................................................... 21 Tex. R. App. P. 9.5 ....................................................................................... 21 Tex. R. App. P. 33.1 ..................................................................................... 16 Tex. R. App. P. 43.3 ....................................................................................... 2 Tex. R. App. P. 43.4 ..................................................................................... 19 Tex. R. Civ. P. 139 ........................................................................................ 19 OTHER RESTATEMENT (SECOND) OF CONTRACTS § 356 ............................................... 14 vi REPLY ARGUMENT In their Appellants’ Brief, the Physicians provided this Court several, alternative grounds upon which to reverse the judgment. Namely, the final summary judgment granting declaratory relief in favor of Strandhagen should be reversed because: (1) Strandhagen was required to establish two elements to prevail on her affirmative defense, and she conceded her inability to establish the first element; (2) even if Strandhagen was required to prove only one element, she failed to conclusively establish the second element; (3) Strandhagen did not satisfy her summary-judgment burden of proof regarding the Physicians’ third-party beneficiary status; and (4) the trial court lacked jurisdiction over Strandhagen’s unripe declaratory judgment claim, and it erred in denying the Physicians’ Plea to the Jurisdiction on this basis. Strandhagen offers no response to argument (3) in her Appellee’s Brief. Based on the argument and authorities presented by the Physicians, and Strandhagen’s abandonment of this issue, the Court should conclude that Strandhagen’s prior argument regarding the Physicians’ third-party- beneficiary status does not provide a ground upon which to affirm the summary judgment. 1 Consequently, the summary judgment must either stand or fall based on Strandhagen’s other ground for unenforceability of the liquidated damages provision: her argument that it is a penalty. Although the Physicians maintain their arguments (1) and (4), this Reply Brief focuses on argument (2). Regardless of the scope of Strandhagen’s burden of proof and regardless of the claim’s ripeness, the summary judgment should be reversed because Strandhagen failed to conclusively prove the second element of her defense (“unreasonable forecast”). I. STRANDHAGEN FAILED TO CONCLUSIVELY ESTABLISH ELEMENT TWO: “UNREASONABLE FORECAST.” Strandhagen agrees with the Physicians that, as the party seeking to invalidate the liquidated damages clause, she had the summary-judgment burden to conclusively establish that the clause did not provide a reasonable forecast of just compensation. Appellee’s Brief, p.9. Strandhagen argues that she satisfied this burden by proving that the clause was invalid “on its face,” and was therefore excused from the requirement of proving actual damages in comparison to the liquidated damages amount. Id., p.12-13. This Court should reject her argument because Texas case law recognizes only two theories of “facial invalidity” as exceptions to the general requirement of proving actual damages, and Strandhagen has 2 failed to conclusively demonstrate that this liquidated damages provision satisfies either theory. Strandhagen offers nothing more than broad assumptions without any supporting proof. A. General Rule: Proof of Actual Damages is Required. Strandhagen’s argument over-generalizes the law regarding facial challenges to liquidated damages provisions. Without specifying the reasons why certain provisions have been held facially invalid, Strandhagen cites a string of cases for the implication that a facial challenge broadly provides an alternative in every case to the requirement of proving actual damages. See id., p.13-14. This is not an accurate assessment of Texas law. Contrary to Strandhagen’s argument, Texas courts have invalidated liquidated damage provisions based on only two types of facial challenges, and have oft recognized the limitations of these theories. Infra, Reply Argument I.B. The general rule remains that a party is required to prove an unreasonable disparity between the amount of actual damages and the amount of liquidated damages to satisfy its burden of proof on the “unreasonable forecast” element of penalty. Many cases recognize this general standard. See Appellants’ Brief, p.23-25 (citing Phillips, Healix, Triton, Southern Union, and GPA Holdings); see also, e.g., Garden Ridge, 3 L.P. v. Advance Int’l, Inc., 403 S.W.3d 432, 440 (Tex. App.—Houston [14th Dist.] 2013, pet. denied) (“[T]o determine whether a term fixes unreasonably large liquidated damages, it follows that courts would need to consider what actual harm, if any, was caused by the breach and then compare it to the stipulated amount of liquidated damages.”); Chan v. Montebello Dev. Co., No. 14-06-00936-CV, 2008 WL 2986379, at *3-4 (Tex. App.—Houston [14th Dist.] 2008, pet. denied) (“[T]o meet this burden [of proving unreasonable forecast], the party asserting the defense is required to prove the amount of the other parties’ actual damages, if any, to show that the liquidated damages are not an approximation of the stipulated sum.”); CDS Enters., Inc. v. Myrad Real Estate, Inc., No. 14-97- 00197-CV, 1999 WL 548226, *2-3 (Tex. App.—Houston [14th Dist.] 1999, no pet.) (“Texcon was required to prove the amount of Myrad’s actual damages, if any, for establishing an absence of an approximation between the actual loss and the stipulated sum. . . . Texcon did not meet its burden in proving the liquidated damages clause was unenforceable because it failed to prove the amount of Myrad’s actual damages.”); Oetting v. Flake, 553 S.W.2d 793, 795 (Tex. App.—Fort Worth 1977, no writ) (“The [party seeking to invalidate the clause], by both allegation and proof, must raise the issue and assume the burden of proving the amount of the actual 4 damages for the purpose of showing an absence of approximation between the actual loss and the stipulated sum.”). 1. It is undisputed that Strandhagen offered no proof of actual damages. The record plainly demonstrates that Strandhagen offered no evidence of the amount of any actual damages suffered by the Physicians. Strandhagen does not contend otherwise. See Appellee’s Brief, p.14. Thus, the only way to hold that Strandhagen satisfied her summary-judgment burden of proof on the “unreasonable forecast” element would be to conclude that she established, as a matter of law, that the liquidated damages provision satisfies a “facial invalidity” exception to the general requirement of proving actual damages. Strandhagen did not do so, meaning the summary judgment must be reversed. B. Narrow Exceptions: Two Types of Facial Invalidity. The Texas Supreme Court has recognized two exceptions in which a party may satisfy its burden of proving that a liquidated damages provision is not a reasonable forecast of just compensation in the absence of proof of actual damages. These two exceptions arise where the liquidated damages provision is deemed unenforceable “on its face” or “as a matter of law” either because: (1) the amount of liquidated damages is based on a 5 multiplier of actual damages or (2) the liquidated damages provision is triggered by any breach of the contract without regard to the importance or triviality of the breach. Strandhagen labels the latter a “one size fits all” provision. The liquidated damages provision in the parties’ Operations Agreement does not satisfy exception. 1. Multiplier of actual damages: In Phillips v. Phillips, 820 S.W.2d 785, 789 (Tex. 1991) the Court did not hold, as Strandhagen suggests, that the second element (unreasonable forecast) can be satisfied in every case with either a facial challenge or proof of actual damages. See FPL Energy, LLC v. TXU Portfolio Mgmt. Co., LP, 426 S.W.3d 59, 72 (Tex. 2014) (“Phillips did not create a broad power to retroactively invalidate liquidated damages provisions that appear reasonable as written. Nor do we create such a power here.”) (rejecting facial challenge to liquidated damages clause). The Phillips court merely held a facial challenge was satisfactory in that particular case because the liquidated damages amount was a multiplier (10x) of the actual damages. 820 S.W.2d at 787. “The provision cannot meet the second prong of the test because, instead of attempting to forecast actual damages, it calls for them to be determined and then multiplied.” Id. at 789; see also Magill v. Watson, 409 S.W.3d 673, 681 6 (Tex. App.—Houston [1st Dist.] 2013, no pet.) (reaching same conclusion where liquidated damages provision multiplied actual damages by three). Following Phillips, this Court and others courts have recognized that the unique facial invalidity present there does not automatically relieve the burden in all cases to prove an unreasonable disparity between the actual damages and liquidated damages amounts. See e.g., Khan v. Meknojiya, No. 03-11-00580-CV, 2013 WL 3336874, at *4 n.4 (Tex. App.—Austin 2013, no pet.) (“Meknojiya’s reliance on Phillips in this case is misplaced” because the provision “does not require a separate determination of damages or the application of any multiplier to that amount. Thus, . . . unlike the court in Phillips we could not conclude that it constitutes a penalty on its face.”); Dunlap v. Gayle, No. 13-12-00105-CV, 2013 WL 1500377, *6 (Tex. App.— Corpus Christi 2013, no pet.) (liquidated damages provision based on a multiplier of earnest money rather than actual damages was not facially invalid under Phillips). The liquidated damages provision in this case does not rely on a multiplier of actual damages. (CR.168). Thus, just as in Khan, Strandhagen’s reliance on Phillips to establish a facial invalidity is misplaced. 7 2. One size fits all: The only other type of facial invalidity recognized by Texas courts arises when a provision imposes the same amount of liquidated damages for both substantial and trivial breaches. See, e.g., Stewart v. Basey, 245 S.W.2d 484, 487 (Tex. 1952) (in building lease agreement, clause providing for liquidated damages of $150/month for each month of the remaining term for any breach of the agreement, whether it be a failure to perform the most important obligation or a minor covenant, was facially invalid); Community Dev. Serv., Inc. v. Replacement Parts Mfg., Inc., 679 S.W.2d 721, 727 (Tex. App.—Houston [1st Dist.] 1984, no writ) (liquidated damages clause was unenforceable because, even though it provided reasonable damages for major breaches of the contract, it also allowed unreasonable damages for trivial breaches); Bethel v. Butler Drilling Co., 635 S.W.2d 834, 837 (Tex. Civ. App.—Houston [14th Dist.] 1982, writ ref'd n.r.e.) (liquidated damages provision was facially invalid where it “would apply with equal force for such trivial breaches by appellee Butler as failing to pay utilities, provide parking space or pay an additional hourly labor charge of $10.00,” as well as to full termination of contract without cause); Mayfield v. Hicks, 575 S.W.2d 571, 575 (Tex. App.—Dallas 1978, writ ref’d n.r.e.) 8 (provision was unenforceable because liquidated damages could be imposed upon “even a minor default”). a. Strandhagen failed to prove that this is a facially invalid “one size fits all” provision. Unlike all of the foregoing cases, the liquidated damages provision here is triggered by only one form of breach, and it is a major one: a physician’s early departure from the practice without just cause, as specified in the contract. (CR.167-169); Appellants’ Brief, p.7, 26-27. Hence, this provision is facially valid, as the court concluded in Urban Television Network Corp. v. Liquidity Solutions, L.P., 277 S.W.3d 917, 919- 20 (Tex. App.—Dallas 2009, no pet.). There, the court disagreed “with appellant’s assertion that the liquidated damages provision applied to any breach of the agreement, no matter how trivial” because—as in this case— the liquidated damages were recoverable for only “material” defaults specified within the contract. 1 1 See also Appellants’ Brief, p.27-29 (discussing support provided by Murphy v. Cintas Corp., 923 S.W.2d 663, 666 (Tex. App.—Tyler 1996, writ denied) and RESTATEMENT (SECOND) OF CONTRACTS § 356, Liquidated Damages and Penalties (1981)). Strandhagen’s attempt to distinguish these authorities fails. See Appellee’s Brief, p.14 n.10. Contrary to her argument, the Physicians do not cite Murphy and the RESTATEMENT for the proposition that actual damages must be proven in all cases. Rather, these authorities demonstrate why Strandhagen was required to prove actual damages here because her facial challenge fails. Just as in Murphy, the timing of the breach does not render the clause per se unreasonable, and just as in the RESTATEMENT, the Court’s focus should be on the actual circumstances present here. Appellants’ Brief, p.8. 9 In attempt to overcome the blatant distinction between this case and the ones she relies upon, Strandhagen claims that the amount of damages resulting from this one type of material breach (early departure) “would obviously be greater the earlier Dr. Strandhagen stopped working at AAT.” Appellee’s Brief, p.17. Strandhagen offered no proof to support this allegedly “obvious” outcome. Contrary to Strandhagen’s unsupported conclusion, there is no “obvious” reason why the damages suffered would vary greatly depending on when she or another physician left the practice. Following any departure constituting a breach, the practice would be disrupted, suffer a loss of goodwill, incur scheduling and short-staffing issues, and incur costs and expenses related to finding a temporary and/or long-term replacement for the departed physician—all of which would have a negative impact on the group’s profit-making and bonus-earning capabilities. See Appellants’ Brief, p.4-7, 26-27. Whether the departure occurred in year 1 or year 5, these negative impacts would be felt for some period of time before a replacement physician could be located, trained, and incorporated into the practice; the goodwill could be rebuilt; and the profitability could be restored. 10 In the absence of any evidence offered by Strandhagen, there is no way to know what amount of damages would be incurred for a breach at the start of the term versus a breach at the end of the term, and certainly no way to conclude that the damage amounts would be vastly different at either time. Moreover, without any proof from Strandhagen, there is no way to conclude that the liquidated amount of $500,000 would be greatly disproportionate to the actual damages suffered for any such breach. This was Strandhagen’s burden to prove, and she failed to prove it. The summary judgment should be reversed. Several cases demonstrate that unsupported conclusions like Strandhagen’s are insufficient to carry the burden of proof on this type of facial challenge. In SP Terrace, L.P. v. Meritage Homes of Texas, LLC, 334 S.W.3d 275, 287-88 (Tex. App.—Houston [1st Dist.] 2010, no pet.), the court rejected SP Terrace’s facial challenge because it “adduced no evidence” to establish that the amount of liquidated damages was unreasonable either because the “breach was a trivial one” or because the breach was of a far greater magnitude than would be justly compensated. Id. (“We decline to remove a limitation of remedy provision absent any evidence that the liquidated amount in the contract is unreasonably high or low in light of the alleged breach.”); see also Urban Television, 277 S.W.3d 11 at 920 (“Appellant has not established that the liquidated damages provision is unenforceable on its face or presented evidence raising a genuine issue of material fact as to its enforceability.”); R. Conrad Moore & Assoc., Inc. v. Lerma, 946 S.W.2d 90, 96 (Tex. App.—El Paso 1997, writ denied) (where liquidated damage amount would be the amount of earnest money regardless of time of breach, clause was not unreasonable on its face; proof of actual damages was necessary to satisfy this element); Community Dev., 679 S.W.2d at 727 (jury findings and evidence supported claim that provision operated as penalty); In re Dow Corning Corp., 419 F.3d 543, 552 (6th Cir. 2005) (Dow satisfied its burden to prove unreasonable forecast by presenting evidence that the parties never discussed potential damages at the time of making the contract and “that the clause was initially proposed as a penalty untied to any potential damages”). Strandhagen offered absolutely no evidence in support of her contention that the magnitude of the breach would be greater depending on its timing. Without any proof, Strandhagen’s bare conclusion cannot be accepted in satisfaction of her summary-judgment burden. Strandhagen has not cited and the Physicians have not found a single case rendering a liquidated damages provision akin to this one unenforceable on the basis of a “one size fits all” facial challenge. The case 12 Strandhagen specifically relies on for this proposition is distinguishable. See Appellee’s Brief, p.17 (citing Eberts v. Businesspeople Personnel Servs., Inc., 620 S.W.2d 861 (Tex. App.—Dallas 1981, no writ). In Eberts, the provision was deemed unenforceable because it would impose the same amount of liquidated damages regardless of whether the breach continued for one day or two years. Id. at 864. Here, the liquidated damages are not imposed upon variable lengths of a “continuing” breach. Instead, the breach would occur at the moment of improper early departure, as specified in the contract. As discussed above, the practice would suffer disruption and financial hardship for some period of time following that breach whether it occurred in year 1 or year 5. Strandhagen offered no evidence to establish that the length of disruption or magnitude of hardship would vary depending on the time of the breach. The liquidated damages are intended to justly compensate for these negative financial effects, whenever incurred. C. Conclusion on “Unreasonable Forecast.” To satisfy her summary-judgment burden of proof on the second element of her penalty affirmative defense (“unreasonable forecast”), Strandhagen would generally be required to prove actual damages and 13 demonstrate an unreasonable disparity between that amount and the liquidated damages amount. Strandhagen admittedly failed to do so. In the alternative, Strandhagen could satisfy her burden of proof by demonstrating, as a matter of law, that this liquidated damages provision is invalid on its face because it is a “one size fits all” provision. Strandhagen failed to carry her burden of proof on this theory because (1) the liquidated damages are triggered by only one form of material breach, early departure from the practice under specified circumstances; and (2) Strandhagen offered nothing beyond speculation to establish that a physician’s early departure would constitute a breach of greater magnitude if it occurred earlier than later in the physician’s term of employment. Consequently, Strandhagen has failed to prove that the liquidated damages would be equally imposed upon breaches of both important and trivial natures. Strandhagen therefore failed to demonstrate any facial invalidity as a matter of law. Because Strandhagen has failed to satisfy her summary-judgment burden of proof on the second element of her affirmative defense (and she concedes her inability to prove the first element), the summary judgment should be reversed. 14 II. ADDITIONAL REPLY ARGUMENTS: A. Arguments Made in the Physicians’ Motion for New Trial Were Preserved for Review. Strandhagen argues that arguments made by the Physicians for the first time in their Motion for New Trial were not preserved for review. Appellee’s Brief, p.5, 7, 20. Although it may generally be true that an argument raised for the first time in a motion for new trial is not preserved, there is an exception applicable here. “[T]he efficacy of a post-judgment motion to preserve a complaint for appellate review depends upon whether the trial court affirmatively considers the new grounds and proof as memorialized by a written order.” Charbonnet v. Shami, No. 04-12-00711-CV, 2013 WL 2645720, *5 (Tex. App.—San Antonio 2013, pet. denied). Where the court considers the new grounds asserted in the post-judgment motion and signs a new order affirming its prior ruling based upon the entire record—as opposed to simply allowing the motion to be overruled by operation of law—the new arguments are preserved for review. Id. at *5-6; see also Ayeni v. State, 440 S.W.3d 707, 709 (Tex. App.—Austin 2013, no pet.) (arguments and evidence presented in motion for reconsideration of summary judgment were preserved where order specified that court considered these arguments and evidence). None of the cases cited by Strandhagen in 15 support of her waiver argument reflect that such circumstances were present to satisfy this exception; thus, they are distinguishable from this case. See Appellee’s Brief, p.21 n.18. Strandhagen acknowledges that there was “full briefing and a hearing” on the arguments raised in the Physicians’ Motion for New Trial. Appellee’s Brief, p.6. Moreover, the Order Denying the Motion for New Trial expressly states that the district court “considered the grounds asserted in the Motion, the Response, the arguments of counsel, the evidence filed, and the contents of the Court’s file” in making its determination. (CR.271). Because it is apparent from the record that the arguments raised by the Physicians in their Motion for New Trial were considered on their merits and denied, these arguments were preserved for review. See generally Tex. R. App. P. 33.1. B. The Physicians “Modification” Argument Was Not an Affirmative Defense. The Physicians argued that the severability clause in Section 7(f) of the Operations Agreement demonstrated a genuine issue of material fact about the interpretation and enforceability of the liquidated damages provision. (CR.223) (arguing that “a genuine issue of material fact remains about what modified amount or calculation would be reasonable to enforce 16 in[stead of the $500,000 liquidated amount]” based on the severability clause). Contrary to Strandhagen’s argument, the Physicians’ argument did not present the affirmative defense of “modification.” See, e.g., Williams v. Colthurst, 253 S.W.3d 353, 359 (Tex. App.—Eastland 2008, no pet.) (affirmative defense of modification is based on argument that parties had a “meeting of the minds” to a new agreement “supported by consideration,” such as an “accord and satisfaction”); Hill v. Heritage Res., Inc., 964 S.W.2d 89, 113 (Tex. App.—El Paso 1997, pet. denied) (“To conclude that there was a valid modification, the jury had to favorably determine two elements. The first is that the modification is based upon new consideration. The second is that there existed the same degree of mutuality and meeting of the minds as was present for the original contract.”) (collecting cases; citations omitted). The Physicians were in no way seeking to avoid the enforcement of the parties’ contract by arguing that the parties had reached a new, modified agreement supported by sufficient consideration, as would be the case under the affirmative defense of modification. Instead, the Physicians were simply arguing that Strandhagen failed to carry her traditional summary-judgment burden because a genuine issue of material fact existed 17 within the four corners of the Operations Agreement, which was part of the original summary-judgment record. Hence, there were no “elements” on which the Physicians carried the burden of proof. C. Strandhagen Cannot Use the Declaratory Judgment Act to Create Jurisdiction. Strandhagen argues that a live controversy sufficient to support jurisdiction under the Declaratory Judgments Act (“DJA”) exists based on the arguments presented by the Physicians to this Court regarding the proper interpretation of the liquidated damages provision. Appellee’s Brief, p.24, 26. To accept Strandhagen’s argument would turn the DJA on its head. The DJA cannot be used to create jurisdiction where a live controversy does not already exist. See Tex. Ass’n of Bus. v. Tex. Air Control Bd., 852 S.W.2d 440, 444 (Tex. 1993) (“[W]e have interpreted the [DJA] to be merely a procedural device for deciding cases already within a court’s jurisdiction rather than a legislative enlargement of a court’s power, permitting the rendition of advisory opinions.”); Devon Energy Prod. Co. v. KCS Res., LLC, 450 S.W.3d 203, 210, 212 (Tex. App.—Houston [14th Dist.] 2014, pet. filed on other grounds) (same; holding court lacked jurisdiction over declaratory judgment claim because it was premised on the happening of a future, hypothetical event—an underlying legal determination about 18 the parties’ intent); Taylor v. State Farm Lloyds, Inc., 124 S.W.3d 665, 668-69 (Tex. App.—Austin, 2003, pet. denied) (“[The DJA] does not confer jurisdiction on a trial court but rather makes declaratory judgment available as a remedy for a cause of action already within the court’s jurisdiction.”) (citing Chenault v. Phillips, 914 S.W.2d 140, 141 (Tex. 1996) (holding that mere request for declaratory judgment does not establish jurisdiction)). Here, there is no evidence that the Physicians had taken any action or threatened or pursue a claim for breach of contract against Strandhagen. At most, Strandhagen’s affidavit includes a conclusory and speculative statement that she “learned . . . [the Physicians] and perhaps others are seeking to pursue her for collection.” (CR.8, 12). In reality, the Physicians never took any action to pursue a claim against her. If there was any evidence that the Physicians had done so, Strandhagen surely would have presented that evidence to the district court to demonstrate jurisdiction. She now blames the Physicians for being unable to prove a negative. Before any actual dispute or controversy ripened between Strandhagen and the Physicians, Strandhagen filed this preemptive suit, which the Physicians were then forced to answer and defend. At that time, an active controversy existed between Strandhagen and her employer 19 (AAT) regarding whether or not she had been terminated for cause. (CR.39, 80, 85-87, 91-93, 144). The Physicians were entitled to wait and see how that issue developed and/or was resolved before deciding whether to pursue a claim against Strandhagen because her early departure would not be considered a breach of the Operations Agreement if it resulted from AAT’s termination of her employment without cause. (CR.168). On this basis, when Strandhagen filed suit against the Physicians, their determination about whether or not to pursue a claim against Strandhagen remained an open, theoretical issue. 2 The fact that the Physicians have defended the validity of their contractual language does not demonstrate that a sufficiently ripe claim for breach of contract existed at the time Strandhagen filed suit for purposes of jurisdiction. The trial court erred in denying the Physicians’ Plea to the Jurisdiction and in granting Strandhagen’s Motion for Summary Judgment on this basis. 2 Strandhagen cites to page 8 of Appellants’ Brief as proof of that an allegedly ripe controversy existed. Appellee’s Brief, p.26. She claims the Physicians “admit[ted]” that her employment was terminated “under circumstances where they contend she ‘would be liable for payment of liquidated damages.’” Id. Rather than “acknowledging” the existence of a ripe controversy, the Physicians argument is presented in hypothetical terms: “If [it] were true [that Strandhagen was terminated on the basis of discrimination] it would provide [an] exception to her liability under the liquidated damages provision. . . . [On the other hand, if the Company were correct that] Strandhagen quit or was terminated with cause in September 2013 . . . [then she] would be liable for payment of liquidated damages.” Appellants’ Brief, p.8. 20 PRAYER Based on the foregoing, Appellants respectfully pray that this Court sustain both of their issues on appeal and reverse the district court’s grant of Strandhagen’s Motion for Summary Judgment, its partial denial of the Physicians’ Plea to the Jurisdiction, and its denial of the Physicians’ Motion for New Trial. If the jurisdictional ruling is reversed, then this Court should render judgment in favor of the Physicians dismissing Strandhagen’s claim in its entirety. Otherwise, this Court should remand to the district court for further proceedings. Appellants further pray that this Court tax all costs against Strandhagen, both in this Court and below, and award the Appellants any such other relief at law or equity to which they may be justly entitled. Tex. R. App. P. 43.4; Tex. R. Civ. P. 139. 21 Respectfully submitted, MARTENS, TODD, LEONARD, TAYLOR & AHLRICH By: __/s/ Amanda G. Taylor____ Amanda Garrett Taylor ataylor@textaxlaw.com Texas Bar No. 24045921 301 Congress Avenue, Suite 1950 Austin, Texas 78701 Tele: (512) 542-9898 Fax: (512) 542-9899 ATTORNEY FOR APPELLANTS CERTIFICATE OF COMPLIANCE I certify that this Appellants’ Brief complies with the typeface requirements of Tex. R. App. P. 9.4(e) because it has been prepared in a conventional typeface no smaller than 14-point for text and 12-point for footnotes. This document also complies with the word-count limitations of Tex. R. App. P. 9.4(i) because, according to the word-count tool of the computer program used to prepare this document, it contains 4,368 words, excluding any parts exempted by Tex. R. App. P. 9.4(i)(1). /s/Amanda Taylor__________ Amanda Taylor 22 CERTIFICATE OF SERVICE I certify that a true and correct copy of this Appellants’ Brief was filed electronically and served on all counsel via e-mail in compliance with Tex. R. App. P. 9.5(b) and L.R.3 on this 16th day of March, 2015. Daniel Byrne DByrne@FBHH.com Lessie Fitzpatrick LFitzpatrick@FBHH.com FRITZ, BYRNE, HEAD & HARRISON, PLLC 98 San Jacinto Blvd, Suite 2000 Austin, TX 78701 Telephone: (512) 476-2020 /s/Amanda Taylor__________ Amanda Taylor 23 Ayeni v. State, 440 S.W.3d 707 (2013) 440 S.W.3d 707 Court of Appeals of Texas, Austin. Alhaji Isa Adegori AYENI, Appellant v. The STATE of Texas; The City of Houston, Texas; and The Transit Authority of Houston, Texas, Appellees. No. 03–11–00604–CV. | Feb. 20, 2013. Synopsis Background: Attorney General brought action on behalf of city and transit authority against taxpayer to recover delinquent sales taxes, penalties, and interest. The District Court, Travis County, Scott H. Jenkins, J., entered summary judgment against taxpayer. Taxpayer appealed. Holdings: The Court of Appeals, Pemberton, J., held that: [1] taxpayer's verified denial of Comptroller's certificate of delinquency did not rebut or join issue with the certificate, such that its prima facie or presumptive validity under statute effectively disappeared, and [2] affidavit by taxpayer's bookkeeper was incompetent summary judgment evidence. Affirmed. Pemberton J., concurred and filed opinion. Attorneys and Law Firms *708 Tina Lin, Jorge Romero, Matthew G. Wylie, Matthew G. Wylie, P.C., Houston, TX, for Appellant. John C. Adams, Assistant Attorney General, Cristina M. Nahidi, Bankruptcy & Collections Division, Austin, TX, for Appellees. Before Justices PURYEAR, PEMBERTON and HENSON. © 2015 Thomson Reuters. No claim to original U.S. Government Works. 1 Ayeni v. State, 440 S.W.3d 707 (2013) MEMORANDUM OPINION BOB PEMBERTON, Justice. This is an appeal from a final summary judgment in a sales tax deficiency case. We will affirm the judgment. BACKGROUND Appellant Ayeni operated a convenience store out of his residence in Houston, Texas. The Comptroller conducted a sales-tax audit of Ayeni's business for the period covering January 1, 2004, through December 31, 2006. Ayeni acknowledges that he “did not keep a good record of his business documents,” 1 and in the absence of such records, the Comptroller resorted to estimating Ayeni's sales and tax liability from records of Ayeni's beer purchases obtained from certain of his vendors and industry sales averages. 2 Through these calculations, the Comptroller determined that Ayeni owed the appellee taxing authorities 3 approximately $48,000 in unpaid sales taxes for the audit period, penalties, and interest. After Ayeni failed to pay the determination, the Comptroller issued a certificate of tax delinquency to the Attorney General's office for collection. The Attorney General subsequently sued Ayeni on appellees' behalf to recover the delinquent sales taxes, penalties, and interest as set forth in the Comptroller's certificate of deficiency, plus attorney's fees. Ayeni filed a general denial, later amended to a verified denial. Appellees filed a traditional motion for summary judgment on all of their claims, attaching as evidence the Comptroller's certificate and an affidavit from appellees' counsel averring that they had incurred $7,500 in attorney's fees in the proceeding. Ayeni filed a response to appellees' motion and a supplement, presenting affidavits *709 from himself and his bookkeeper in which each disputed the accuracy of the Comptroller's tax calculations and underlying estimates of Ayeni's beer sales. In further support, Ayeni attached numerous receipts that purported to reflect actual beer purchases by Ayeni. Ayeni also presented an affidavit from his counsel attempting to controvert appellees' attorney's fees affidavit. Following a hearing, the district court granted partial summary judgment that Ayeni was liable for the deficiency in the certified amount. However, it denied appellees' motion on their claim for attorney's fees. © 2015 Thomson Reuters. No claim to original U.S. Government Works. 2 Ayeni v. State, 440 S.W.3d 707 (2013) Ayeni filed a motion to reconsider the partial summary judgment, attaching additional documents from the Comptroller reflecting the Comptroller's methodology in estimating the sales taxes Ayeni owed. Following a hearing, the district court denied the motion for reconsideration by written order. To ensure “a clear appellate record,” the order further specified that the district court had ultimately considered the entirety of the evidence and arguments Ayeni had filed in the case in its summary-judgment ruling. Subsequently, the district court signed a final judgment incorporating its earlier partial summary judgment and awarding appellees $2,000 in attorney's fees. 4 It is from this final judgment that Ayeni now appeals. ANALYSIS Ayeni seeks reversal of the district court's judgment in four issues that claim error in the summary- judgment ruling. In his first two issues, Ayeni asserts that he presented summary-judgment evidence of his tax liability that controverted the Comptroller's certificate and raised a fact issue that precluded summary judgment for appellees. In his third issue, Ayeni insists that the district court erred or abused its discretion by granting partial summary judgment when appellees had instead sought a final summary judgment. In his fourth issue, Ayeni argues that the Comptroller's certificate of delinquency could not support summary judgment in appellees' favor in the face of Ayeni's verified denial. Standard of review The standards of review for summary judgments are well established. We review the summary- judgment motion and response, if any, de novo to determine if the competent summary-judgment evidence included with those pleadings shows that there is no genuine issue as to any material fact and the movant is entitled to summary judgment as a matter of law. See Tex.R. Civ. P. 166a(c); Valence Operating Co. v. Dorsett, 164 S.W.3d 656, 661 (Tex.2005). We take as true all evidence favorable to the non-movant, and we indulge every reasonable inference and resolve any doubts in the non-movant's favor. See Valence, 164 S.W.3d at 661. [1] Where, as here, the movant relies on the “traditional” summary-judgment standard, the movant has the initial burden of demonstrating that there is no genuine issue of material fact and that he or she is entitled to judgment as a matter of law. See M.D. Anderson Hosp. & Tumor Inst. v. Willrich, 28 S.W.3d 22, 23 (Tex.2000) (per curiam). Assuming this burden is met, and only if it is, the burden shifts to the non-movant to present evidence raising a genuine issue of material fact as to the movant's claims. See id. If the non-movant's evidence raises a fact issue, summary judgment is not appropriate. See id. © 2015 Thomson Reuters. No claim to original U.S. Government Works. 3 Ayeni v. State, 440 S.W.3d 707 (2013) *710 Verified denial [2] We begin with Ayeni's fourth issue because it logically precedes the others—it amounts to a challenge to whether appellees' summary-judgment proof was sufficient to meet their initial burden of showing the absence of a genuine issue of material fact and entitlement to judgment as a matter of law. See id. To meet their burden as to Ayeni's sales tax liability, appellees relied solely on the Comptroller's certificate of delinquency. As Ayeni acknowledges, subsection (a) of tax code section 111.013 makes the Comptroller's certificate— ... prima facie evidence of: (1) the stated tax or amount of the tax, after all just and lawful offsets, payments, and credits have been allowed; (2) the stated amount of penalties and interest; (3) the delinquency of the amounts; and (4) the compliance of the comptroller with the applicable provisions of this code in computing and determining the amount due. Tex. Tax Code Ann. § 111.013(a) (West 2008). Consequently, it is well established that a Comptroller's certificate of delinquency suffices to meet a taxing authority's initial summary- judgment burden in a sales-tax deficiency suit, shifting the burden to the taxpayer to raise a fact issue in order to avoid summary judgment. See N.S. Sportswear, Inc. v. State, 819 S.W.2d 230, 232 (Tex.App.-Austin 1991, no writ) (“If unrebutted, [Comptroller's certificates of deficiency] are sufficient to establish, as a matter of law, the amount of tax the taxpayer owes.” (citing Baker v. Bullock, 529 S.W.2d 279, 281 (Tex.Civ.App.-Austin 1975, writ ref'd n.r.e.))). But Ayeni argues that his verified denial of appellee's claims served to rebut or join issue with the Comptroller's certificate, such that its prima facie or presumptive validity effectively disappeared, returning appellees to their status quo ante—and leaving appellees lacking in any summary-judgment proof to meet their initial burden. We disagree that Ayeni's verified denial had this effect. Ayeni emphasizes subsection (b) of tax code section 111.013, which states: The defendant may not deny a claim for taxes, penalties, or interest unless the defendant timely files a sworn written denial that specifically identifies the taxes, penalties, and interest the defendant asserts are not due and the amounts of tax, penalties, and interest that are not due. © 2015 Thomson Reuters. No claim to original U.S. Government Works. 4 Ayeni v. State, 440 S.W.3d 707 (2013) Tex. Tax Code Ann. § 111.013(b). Ayeni suggests that subsection (b), read together with subsection (a)'s provisions describing the prima facie effect of the Comptroller's certificate, means that the filing of a verified denial under subsection (b) rebuts or negates the prime facie effect of a Comptroller's certificate under subsection (a), much like a verified denial in a suit on sworn account. See Tex.R. Civ. P. 185; Rizk v. Financial Guardian Ins. Agency, Inc., 584 S.W.2d 860, 862 (Tex.1979) (“It is settled ... that a defendant's verified denial of the correctness of a plaintiff's sworn account in the form required by Rule 185 destroys the evidentiary effect of the itemized account attached to the petition and forces the plaintiff to put on proof of his claim.”). However, unlike the rules governing suits on sworn accounts, nothing in section 111.013 says that subsection (b)'s verified denial has any impact on the operation and effect of subsection (a)'s Comptroller's certificate. Cf. Tex.R. Civ. P. 185 (providing affidavit on sworn account is “prima facie evidence [of the account], unless the party resisting such claim shall file a written denial, under oath”). Nor can Ayeni point to any Texas court that has said it does. *711 Neither subsection (a) or (b) references the other, and we can only conclude that both provisions must be given the effect the Legislature prescribes within each. Subsection (b) is in the nature of a pleading requirement with which defendants in sales-tax deficiency cases must comply in order to join issue with the taxing authority's petition; otherwise, the taxpayer loses by default. See Noorani Gas & Convenience, Inc. v. State, No. 03–06–00463–CV, 2008 WL 1827605, at *5 (Tex.App.-Austin Apr. 24, 2008, no pet) (mem. op.). In contrast, subsection (a) speaks to the evidence on which the taxing authority may rely to meet its burden of proof if and when its pleadings are placed at issue by a verified denial. And the Legislature in subsection (a) has made Comptroller's certificates of deficiency prima facie evidence without preconditions. See Tex. Tax Code Ann. § 111.013(a). Accordingly, Ayeni's verified denial does not affect the prima facie evidentiary nature of the Comptroller's certificate of deficiency in this case. We overrule Ayeni's fourth issue on appeal. Controverting proof Because appellees attached the Comptroller's certificate of deficiency to their summary-judgment motion and it is sufficient to meet their initial summary-judgment burden, the burden shifted to Ayeni to raise a question of fact as to the amount of taxes, penalties, and interest he owed for the audit period at issue or as to the Comptroller's compliance with the applicable provisions of the tax code in computing and determining the amount due. See id.; N.S. Sportswear, Inc., 819 S.W.2d at 232. Appellees have urged that Ayeni had to do more than present the legally sufficient contrary evidence that is ordinarily required on summary judgment. In their view, Ayeni was required to adduce conclusive contrary evidence—i.e., prove as a matter of law that he did not owe the amount the Comptroller certified—in order to preclude summary judgment based on the certification. In his second issue, Ayeni disputes appellees' view of his summary-judgment burden, urging that he was required to present only summary-judgment evidence sufficient to raise a genuine issue of © 2015 Thomson Reuters. No claim to original U.S. Government Works. 5 Ayeni v. State, 440 S.W.3d 707 (2013) material fact regarding his tax liability, not conclusive evidence. In his first issue, Ayeni argues that his summary-judgment proof is sufficient to raise a fact issue and even rises to the level of conclusive contrary evidence. We need not address Ayeni's second issue because we conclude that he has not presented competent evidence sufficient to raise a fact issue even under the customary summary-judgment burdens. In an attempt to raise a fact issue, Ayeni submitted his and his bookkeeper's affidavits, sales-tax returns for 2005, 2006, 2007, 2008, 2009, and the first quarter of 2010, and various receipts from beer vendors dated between 2004 and 2006. Ayeni's affidavit stated that he did not owe the taxes, penalties, and interest claimed by the Comptroller because those amounts were “based on incorrect taxable sale amounts.” He then averred that the correct taxable sale amounts were set forth in the sales-tax returns attached to his summary-judgment response. Finally, Ayeni stated in his affidavit that the Comptroller incorrectly estimated his beer sales for the audit period and that his records showed that he made gross beer purchases of $8,827.11 in 2004, $5,681.99 in 2005, and $6,622.02 in 2006. Similarly, Ayeni's bookkeeper testified in his affidavit that Ayeni did not owe the amounts established by the Comptroller's certificate of deficiency because those amounts were based on incorrect taxable sale amounts. The correct amount of taxes owed, the bookkeeper averred, were set forth in the attached sales-tax returns and vendor receipts, which returns the bookkeeper *712 prepared in the regular course of Ayeni's business. Finally, Ayeni's bookkeeper reiterated Ayeni's contentions regarding the gross purchases of beer made by Ayeni in 2004, 2005, and 2006. [3] [4] The affidavit testimony that the Comptroller's amounts are incorrect and that Ayeni's amounts are correct are bare conclusions unsupported by facts. These statements are thus incompetent summary-judgment evidence. To be competent summary-judgment evidence, an affidavit must contain specific factual bases, admissible in evidence, upon which its conclusions are based. Brownlee v. Brownlee, 665 S.W.2d 111, 112 (Tex.1984); see Tex.R. Civ. P. 166a(f) (affidavits “shall set forth such facts as would be admissible in evidence”). The same is true of affidavit assertions that the Comptroller's estimates of his beer sales are incorrect: Although Ayeni does offer that “his records showed” that he made gross beer purchases of $8,827.11 in 2004, $5,681.99 in 2005, and $6,622.02 in 2006” and he includes some of those purchase receipts, he does not assert that those were his total purchases of taxable items during that period or state with any specificity how the Comptroller's numbers were incorrect. More important, Ayeni's affidavits do not state what Ayeni's total sales amounts were for the period at issue, which amounts are, by statute, the basis for determining sales tax owed. See Tex. Tax Code Ann. § 151.051 (West 2008) (imposing sales tax based on a percentage of sale price). To that extent, even if the affidavits were competent summary-judgment evidence, they do not raise a question of fact as to the correct amount of sales taxes owed. Accordingly, summary judgment in favor of the appellees was proper. We overrule Ayeni's first issue. © 2015 Thomson Reuters. No claim to original U.S. Government Works. 6 Ayeni v. State, 440 S.W.3d 707 (2013) Partial summary judgment [5] In his third issue, Ayeni contends that the district court had no authority to grant a partial summary judgment because the Comptroller did not seek alternative or partial relief in its summary-judgment motion. But rule 166a explicitly permits a trial court to grant a partial summary judgment: Case not Fully Adjudicated on Motion. If summary judgment is not rendered upon the whole case or for all the relief asked and a trial is necessary, the judge may at the hearing examine the pleadings and the evidence on file, interrogate counsel, ascertain what material fact issues exist and make an order specifying the facts that are established as a matter of law, and directing such further proceedings in the action as are just. Tex.R. Civ. P. 166a(e). Here, the Comptroller sought summary judgment on two claims— a claim seeking delinquent sales taxes owed and a claim for attorney's fees—but the district court determined that the Comptroller met its summary-judgment burden only as to its claim for sales taxes owed and not as to its claim for attorney's fees. Accordingly, under rule 166a, it was appropriate for the district court to grant a partial summary judgment on the claim for sales tax owed and deny the Comptroller's motion as to attorney's fees. See Pinnacle Anesthesia Consultants, P.A. v. Fisher, 309 S.W.3d 93, 100 (Tex.App.-Dallas 2009, pet. denied) (“If a case is not fully adjudicated on a motion for summary judgment, the trial court is authorized to render partial summary judgment, making ‘an order specifying the facts that are established as a matter of law, and directing such further proceedings in the action as are just’ ”) quoting Tex.R. Civ. P. 166a(e))). Ayeni also suggests that the district court improperly granted partial summary judgment on no- evidence grounds. But there is nothing in the district court's order suggesting that the “partial” aspect of the summary judgment was a reference to *713 the traditional versus no-evidence standard, as opposed to the claims being addressed. Accordingly, we overrule Ayeni's third issue on appeal. CONCLUSION We affirm the district court's judgment. Justice HENSON Not Participating. © 2015 Thomson Reuters. No claim to original U.S. Government Works. 7 Ayeni v. State, 440 S.W.3d 707 (2013) Concurring Opinion by Justice PEMBERTON. BOB PEMBERTON, Justice, concurring. Although I join in the majority's opinion and judgment—I wrote them, after all—I write separately to offer some additional observations about Ayeni's second issue. While it was ultimately unnecessary for us to reach that issue here, it nonetheless warrants emphasis that Ayeni has identified an aberration in this Court's past jurisprudence addressing the effect of Comptroller certificates of deficiency and how a taxpayer can oppose a summary-judgment motion predicated on one. The notion that a taxpayer must present conclusive contrary evidence to rebut a Comptroller's certificate of deficiency does not find explicit textual support in the current tax code. Subsection (a) of section 111.013 states only that the Comptroller's certificate is “prima facie evidence” of the taxes, penalties, and interest due, the delinquency of those amounts, and of the comptroller's compliance with the tax code. See Tex. Tax Code Ann. § 111.013(a) (West 2008). “Prima facie” is Latin for “first view,” 1 and “prima facie evidence” typically denotes evidence that is determinative of a fact's or facts' existence, sometimes stated in terms of giving rise to a “presumption” of their existence, unless and until some contrary evidence is presented. See Coward v. Gateway Nat'l Bank of Beaumont, 525 S.W.2d 857, 859 (Tex.1975); Dodson v. Watson, 110 Tex. 355, 220 S.W. 771, 772 (1920) ( “Prima facie evidence is merely that which suffices for the proof of a particular fact until contradicted and overcome by other evidence.”); Black's Law Dictionary 638–39 (9th ed.2009) (defining “prima facie evidence” as “[e]vidence that will establish a fact or sustain a judgment unless contrary evidence is produced”). 2 But nothing in section 111.013 purports to require conclusive contrary evidence to rebut or join issue with a Comptroller's certificate. See Tex. Tax Code Ann. § 111.013. Appellees rely less on the tax code than on precedents of this Court, and I must concede they find some support there. As best I can tell, these decisions trace back to a 1967 no-writ case involving a trial on the merits of a tax-deficiency claim, Smith v. State, 418 S.W.2d 893 (Tex.Civ.App.-Austin 1967, no writ). Smith, in turn, purported to rely on the analysis in a 1942 Texas Supreme Court opinion, Southland Life Insurance Co. v. Greenwade, 138 Tex. 450, 159 S.W.2d 854 (1942). 3 Southland Life addressed the nature and application *714 of the presumption of receipt afforded a properly stamped, addressed, and mailed letter in the context of a suit by a life-insurance beneficiary to recover policy proceeds. See id. at 858. The defendant insurance carrier asserted that the decedent's life-insurance policy had lapsed prior to the insured's death due to the insured's failure to make a premium payment that had come due. The case went to trial, at which the plaintiff beneficiary presented detailed evidence that the decedent had properly stamped, addressed, and mailed the premium payment to the insurance company prior to its final due date. This evidence gave rise to the legal presumption that the insurance company had received the payment. See id. © 2015 Thomson Reuters. No claim to original U.S. Government Works. 8 Ayeni v. State, 440 S.W.3d 707 (2013) at 857 (“It is settled in this state, however, that when a letter properly addressed and with postage prepaid is mailed, a presumption of fact (rebuttable of course) arises that it was duly received by the addressee.”). In response, the insurance company presented evidence that it had not received the premium payment. Id. The trial court rendered judgment in favor of the plaintiff beneficiary. On appeal to the Waco Court of Civil Appeals, the insurance company asserted, among other points, that the evidence did not support a finding that the premium payment had been timely paid. See Southland Life Ins. Co. v. Greenwade, 143 S.W.2d 648, 650–51 (Tex.Civ.App.-Waco 1940), reversed by 159 S.W.2d at 858. Specifically, the insurance company argued that because it had produced evidence that it had never actually received the premium, both the presumption of receipt and the foundational evidence supporting that presumption—i.e., that the payment letter had been properly stamped, addressed, and mailed to the company—“disappeared” such that the trier of fact could no longer consider it; thus leaving the plaintiff without any proof of receipt. See id. at 650. The Waco court overruled that issue, holding that even in the face of evidence of non- receipt, the presumption of receipt “continued as evidence” that was sufficient to support the trial court's judgment. See id. at 650. On appeal, although ultimately affirming the trial court's judgment and holding that the evidence was sufficient to support a finding that the premium check had been timely received, the supreme court explicitly rejected the Waco court's view that a presumption like that of receipt could itself be considered evidence. Instead, the supreme court held that a presumption is not evidence and that it disappears once “substantial contrary evidence” is offered by the party against whom the presumption operates. See Southland Life, 159 S.W.2d at 857 (citing Wigmore on Evidence, 2d ed., § 2491); see also General Motors Corp. v. Saenz, 873 S.W.2d 353, 359 (Tex.1993) (“Once ... evidence contradicting the presumption has been offered, the presumption disappears.”). But the court then went on to clarify that the evidence that gave rise to the presumption could still be considered and weighed by the fact-finder, vis-à-vis the carrier's contrary evidence, as evidence that the premium payment had, in fact, been timely received. Southland Life, 159 S.W.2d at 857; see Saenz, 873 S.W.2d at 359. In other words, although the insurance company had offered evidence that it had not timely received the payment, thus eliminating the presumption of receipt, the trier of fact could still consider the facts underlying the presumption-i.e., that the defendant stamped, addressed, and mailed the payment letter to the company-as themselves *715 evidence that the insurance company received the payment. See Southland Life, 159 S.W.2d at 857. And, relying on this evidence of payment, the supreme court went on to hold that the evidence was sufficient to support the trial court's finding that the payment was timely received. See id. The court in Southland Life then went on to observe that there might be circumstances where the presumption's foundational facts could not be considered—i.e., would not support an affirmative finding—by the trier of fact: © 2015 Thomson Reuters. No claim to original U.S. Government Works. 9 Ayeni v. State, 440 S.W.3d 707 (2013) We hold that an inference established prima facie (as in the present case) is overcome, together with the evidentiary facts tending to establish it, only when the evidence tending to support the contrary inference is conclusive, or so clear, positive and disinterested that it would be unreasonable not to give effect to it as conclusive.... [P]rima facie evidence and presumptions of fact disappear when the true facts are conclusively shown by other evidence. ... In other words, presumptions, when controverted by facts, disappear, as such, and cannot be weighed as evidence against such facts. Id. at 858 (internal citations omitted) (emphases in original). In other words, if the party against whom the presumption of receipt operates presents evidence that conclusively negates receipt of the mail, both the presumption of receipt and the probative value of any proof of underlying facts could be said to “disappear” because the evidence, by definition, is legally insufficient to support a finding of receipt. This amounts merely to an observation about the nature of conclusive evidence that negates a fact's existence. See City of Keller v. Wilson, 168 S.W.3d 802, 810 (Tex.2005) (discussing conclusive contrary evidence and noting that “ ‘[n]o evidence points must, and may only, be sustained when the record discloses [that] the evidence establishes conclusively the opposite of the vital fact’ ” (quoting Robert W. Calvert, “No Evidence” and “Insufficient Evidence” Points of Error, 38 Tex. L.Rev. 361 (1960)). In Smith, this Court, citing Southland Life, described a taxpayer's burden in opposing the presumed correctness of a Comptroller's certificate of deficiency at trial as follows: With the prima facie presumption established that the State's claim for admissions taxes 4 against [the owner of a business on the taxpayer's property] was as shown in the Comptroller's certificate under Article 1.08 5 , appellant [taxpayer] had the burden to overcome the inference with such evidence tending to support the contrary as would be conclusive, or evidence so clear and positive it would be unreasonable not to give effect to it as conclusive. Smith, 418 S.W.2d at 896 (citing Southland Life, 159 S.W.2d at 858). This Court has continued to describe the taxpayer's burden at trial in similar terms. 6 To the *716 extent such descriptions refer to the concepts that a Comptroller's certificate, even if met with the taxpayer's contrary evidence, may nonetheless be legally sufficient to support a fact finding of tax liability unless the taxpayer's contrary evidence is conclusive, it is merely an application of the principles described in Southland Life. In any event, Ayeni does not quarrel with the notion that he would be required, at least practically speaking, to present conclusive contrary evidence in order to overcome the effect of a Comptroller's certificate at trial on the merits. Otherwise, under the Southland Life analysis, the © 2015 Thomson Reuters. No claim to original U.S. Government Works. 10 Ayeni v. State, 440 S.W.3d 707 (2013) certificate would remain as legally sufficient evidence that could potentially support fact findings against the taxpayer. But it is quite another thing, Ayeni urges, to hold that a nonmovant must present conclusive contrary evidence to preclude summary judgment based on a Comptroller's certificate, as appellees argue here. I agree. The notion that a taxpayer nonmovant must counter a Comptroller's certificate with conclusive contrary evidence in order to preclude summary judgment traces back to a 2004 memorandum opinion of this Court, Wimmer v. State, No. 03–03–00135–CV, 2004 WL 210629, at *3–4 (Tex.App.-Austin Feb. 5, 2004, pet. denied) (mem. op.). In Wimmer, we held that a taxpayer “must conclusively establish that he owes no tax” to overcome a summary judgment predicated on a Comptroller's certificate of deficiency. See id. at *3. For support, this Court cited Smith and its progeny-again, cases that involved trials on the merits. See id. at *3–4 (citing Sundown Farms, 89 S.W.3d 291, 293 (Tex.App.-Austin 2002, no pet.); Hylton v. State, 665 S.W.2d 571, 572 (Tex.App.-Austin 1984, no writ); Smith, 418 S.W.2d at 893). There was zero explanation or analysis of whether or how those concepts should properly be applied in the vastly different procedural context of summary judgment. See Wimmer, 2004 WL 210629 at *3–4. 7 Contrary to the holdings of Wimmer, and any progeny, their analytical cornerstone in Southland Life would imply that the contrary evidence used to rebut the presumption, even if not conclusive, would raise a fact issue that would have to be resolved by the fact finder and not by summary judgment. See Southland Life, 159 S.W.2d at 857; see also Balawajder v. Texas Dep't of Criminal Justice Inst. Div., 217 S.W.3d 20, 27 (Tex.App.-Houston [1st Dist.] 2006, pet. denied) (“In the context of a summary judgment, the party against whom the presumption operates must produce evidence sufficient ‘to neutralize the effect of the presumption’ for the case to proceed to trial.” quoting Amaye v. Oravetz, 57 S.W.3d 581, 584 (Tex.App.-Houston [14th Dist.] 2001, pet. denied)); First Nat'l Bank of Libby, Montana v. Rector, 710 S.W.2d 100, 103 (Tex.App.-Austin 1986, writ ref'd n.r.e.) (holding that where document created presumption of foreign judgment's validity, the party against whom the presumption operates must “produce some evidence at least raising an issue of material fact as to the validity” of the judgment to defeat summary judgment). And Wimmer, and any subsequent cases that might have followed it, are at odds with the summary- judgment burdens that the Texas Supreme Court has prescribed. Even if it is in some sense correct to state that a taxpayer must overcome a Comptroller's *717 certificate with conclusive evidence at trial on the merits, the supreme court has made it clear that nonmovants do not face higher or different summary-judgment burdens based on the burdens of proof they may face at trial: “The failure of one party in a hearing upon a motion for summary judgment to discharge the burden which would rest on him at a trial on the merits is no ground for a summary judgment in favor of the other party.” Tigner v. First Nat'l Bank of Angleton, 153 Tex. 69, 264 S.W.2d 85, 87 (1954). It has likewise made clear that a movant's summary-judgment burden does not © 2015 Thomson Reuters. No claim to original U.S. Government Works. 11 Ayeni v. State, 440 S.W.3d 707 (2013) depend on its burden of proof at trial: “The presumptions and burden of proof for an ordinary or conventional trial are immaterial to the burden that a movant for summary judgment must bear.” Missouri–Kan.–Tex.R.R. Co. v. City of Dallas, 623 S.W.2d 296, 298 (Tex.1981) (citing Tigner, 264 S.W.2d at 87). In fact, the supreme court held in Missouri–Kansas–Texas Railroad that the taxing authority, which enjoyed a number of presumptions in its favor, including that its property valuations were valid, must nevertheless “ ‘establish [its] entitlement to a summary judgment on the issues expressly presented to the trial court by conclusively proving all essential elements of [its] cause of action or defense as a matter of law.’ ” Id. (quoting City of Houston v. Clear Creek Basin Auth., 589 S.W.2d 671, 678 (Tex.1979)). Thus, even if the taxpayer's burden of proof at trial requires him to produce conclusive evidence to prevail on the merits, he must only produce evidence sufficient to raise a question of fact as to the taxing authority's claim in order to avoid summary judgment. Nonetheless, because Ayeni has not presented competent contrary summary-judgment evidence that would even meet the customary burden of a summary-judgment nonmovant, this is not the case in which this Court should undertake to reexamine the suspect holdings of Wimmer and any progeny en banc. 8 But that case will come along inevitably, so I leave this writing as a place marker for that day. Alternatively, the Legislature could, of course, provide statutory clarification that would obviate the need for any such reexamination. Footnotes 1 Cf. Tex. Tax Code Ann. § 151.025 (West 2012) (requiring taxpayers to maintain certain records, including records of gross receipts, purchases, sales tax received or collected on each sale); 34 Tex. Admin. Code § 3.281(b) (2012) (Comptroller of Public Accounts, Records Required, Information Required) (2012) (same); see also Smith v. State, 418 S.W.2d 893, 895–96 (Tex.Civ.App.-Austin 1967, no writ) (holding that Comptroller may develop system to estimate taxes if taxpayer fails to keep required records). 2 See Tex. Tax Code Ann. § 111.008(a) (West 2008) (“If the comptroller is not satisfied with a tax report or the amount of the tax required to be paid to the state by a person, the comptroller may compute and determine the amount of tax to be paid from information contained in the report or from any other information available to the comptroller.”); 34 Tex. Admin. Code § 3.281(c) (allowing Comptroller to, among other things, estimate tax liability based on any available information if taxpayer fails to keep required records); Alon USA, LP v. State, 222 S.W.3d 19, 32 (Tex.App.-Austin 2005, pet. denied) (noting that comptroller is expressly authorized to determine taxes on the basis of any information within comptroller's possession if taxpayer fails to keep proper records). 3 The State of Texas, the City of Houston, Texas, and the Transit Authority of Houston, Texas. 4 Although the Hon. Scott H. Jenkins signed the final judgment, the Hon. Tim Sulak made the summary-judgment rulings. 1 See Black's Law Dictionary 1310 (9th ed.2009); Webster's Third New Int'l Dictionary 1800 (2002). 2 See In re Allen, 366 S.W.3d 696, 706 (Tex.2012) (“We presume the Legislature is aware of relevant case law when it enacts or modifies statutes.”) (citing Acker v. Texas Water Comm'n, 790 S.W.2d 299, 301 (Tex.1990)); HCBeck, Ltd. v. Rice, 284 S.W.3d 349, 363 (Tex.2009) (“We use definitions prescribed by the Legislature and any technical or particular meaning the words have acquired ....” (citing Tex. Gov't Code Ann. § 311.011)). 3 Southland Life Insurance Co. v. Greenwade, 138 Tex. 450, 159 S.W.2d 854 (1942), was decided by the Texas Commission of Appeals. However, because the opinion was adopted by the Texas Supreme Court and, thus, has the full authority of a Texas Supreme Court decision, it was effectively decided by the Texas Supreme Court. See National Bank of Commerce v. Williams, 125 Tex. 619, 84 S.W.2d 691, 692 (1935); see also Cadle Co. v. Butler, 951 S.W.2d 901, 911 (Tex.App.-Corpus Christi 1997, no pet.) (noting that Commission opinions adopted by the Texas Supreme Court are given the same force, weight, and effect as supreme court opinions). © 2015 Thomson Reuters. No claim to original U.S. Government Works. 12 Ayeni v. State, 440 S.W.3d 707 (2013) 4 “Admissions taxes” are taxes paid “on fees for admission to all places of amusement.” See Smith v. State, 418 S.W.2d 893, 895 (Tex.Civ.App.-Austin 1967, no writ). 5 Predecessor statute to section 111.013 of the Texas Tax Code. 6 Accord Sundown Farms, Inc. v. State, 89 S.W.3d 291, 293 (Tex.App.-Austin 2002, no pet.); Penny v. State, No. 03–97–00399–CV, 1998 WL 394173, at *2 (Tex.App.-Austin July 16, 1998, no pet.) (mem. op.); State v. Glass, 723 S.W.2d 325, 327 (Tex.App.-Austin 1987, writ ref'd n.r.e.); Hylton v. State, 665 S.W.2d 571, 572 (Tex.App.-Austin 1984, no writ); Nu–Way Oil Co. v. Bullock, 546 S.W.2d 336, 339 (Tex.Civ.App.-Austin 1976, no writ); Baker v. Bullock, 529 S.W.2d 279, 281 (Tex.Civ.App.-Austin 1975, writ ref'd n.r.e.); State v. Gifford–Hill & Co., 428 S.W.2d 451, 457 (Tex.Civ.App.-Austin 1968) rev'd on other grounds by 442 S.W.2d 320 (Tex.1969). 7 See also Kawaja v. State, No. 03–05–00491–CV, 2006 WL 1559343 (Tex.App.-Austin June 8, 2006, no pet.) (mem.op.) (also applying, without analysis, conclusive-evidence notion to summary-judgment proceeding) (citing Glass, 723 S.W.2d at 327; Hylton, 665 S.W.2d at 572). 8 We may not overrule a prior panel opinion of this court absent an intervening change in the law by the Legislature or a higher court or by decision of this court sitting en banc. See Tex.R.App. P. 41.2 (providing that en banc consideration is appropriate to secure or maintain uniformity of appellate court decisions); In re Smith, 366 S.W.3d 282, 289 (Tex.App.-Dallas 2012, no pet.); Nowzaradan v. Ryans, 347 S.W.3d 734, 739 (Tex.App.-Houston [14th Dist.] 2011, no pet.). End of Document © 2015 Thomson Reuters. No claim to original U.S. Government Works. © 2015 Thomson Reuters. No claim to original U.S. Government Works. 13 Ayeni v. State, 440 S.W.3d 707 History (4) Direct History (2) 1. State v. Ayeni 2011 WL 9864681 , Tex.Dist. , Sep. 07, 2011 Judgment Affirmed by 2. Ayeni v. State 440 S.W.3d 707 , Tex.App.-Austin , Feb. 20, 2013 Related References (2) 3. State v. Ayeni 2011 WL 9864678 , Tex.Dist. , June 08, 2011 Reconsideration Denied by 4. State v. Ayeni 2011 WL 9864683 , Tex.Dist. , Sep. 07, 2011 © 2015 Thomson Reuters. No claim to original U.S. Government Works. 14 Bethel v. Butler Drilling Co., 635 S.W.2d 834 (1982) 635 S.W.2d 834 Court of Appeals of Texas, Houston (14th Dist.). William J. BETHEL, Jr. dba Ra-Comm Electronics, Appellant, v. BUTLER DRILLING COMPANY, Appellee. No. A2546. | May 27, 1982. Action was brought for breach of contract. The District Court, Harris County, William W. Kilgarlin, J., entered judgment on jury verdict in favor of plaintiff, but failed to award prejudgment interest, and both parties appealed. The Court of Appeals, Price, J., held that: (1) alleged liquidated damage provision of contract was actually penalty and unenforceable; (2) jury award of $12,000 attorney fees was authorized and supported by evidence; (3) prejudgment interest should have been awarded plaintiff; (4) sufficient evidence supported jury's finding that successor corporation ratified contract and such finding was not against great weight and preponderance of evidence; (5) evidence supported jury finding that president of company had authority to sign contract on behalf of company and such finding was not against great weight and preponderance of evidence; (6) plaintiff was not judicially estopped from claiming unlawful termination by reason of testimony given in another lawsuit; (7) evidence did not establish conversion or specific amounts claimed by defendant; and (8) evidence did not exclusively establish as matter of law or by great weight and preponderance of evidence that defendant was terminated for good cause due to alleged insubordination and misconduct. Judgment reformed and as reformed affirmed. Attorneys and Law Firms *836 Murry B. Cohen, Wm. B. (Ben) Adair, Brynes, Myers, Adair, Campbell & Sinex, Houston, for appellant. Harold Lloyd, Michael L. O'Brien, Houston, for appellee. Before J. CURTISS BROWN, C. J., and JUNELL and PRICE, JJ. Opinion PRICE, Justice. © 2015 Thomson Reuters. No claim to original U.S. Government Works. 1 Bethel v. Butler Drilling Co., 635 S.W.2d 834 (1982) This is a breach of contract case. The principal issue on appeal is whether a provision in the written contract in question should be construed as a liquidated damage provision or whether it is a penalty provision which may not be enforced by appellant as liquidated damages. Other points of error asserted by appellant William J. Bethel, Jr. d/b/a Ra-Comm Electronics relating to attorney's fees and pre-judgment interest and cross points by appellee Butler Drilling Corporation are discussed below. We reform the judgment of the trial court to provide for pre-judgment interest from October 1, 1977, on the sum of $10,189.72, and otherwise affirm the judgment of the trial court. The appellant was originally engaged by Butler Drilling Company to perform certain motor vehicle radio maintenance and repair duties for appellee. From 1967 to 1974 appellant operated under an oral month to month agreement. By contract dated August 28, 1974, appellant and Butler Drilling Company entered into a written contract to perform such motor vehicle radio repairs and maintenance on a twenty-four hour on-call basis. The services provided for under the contract were exclusive as to appellee but non-exclusive as to appellant. The contract was signed by appellant William J. Bethel, Jr., and for Butler Drilling Company was signed by its president, Duncan Butler, with a notary acknowledgment also dated August 28, 1974. On October 1, 1974, Butler Drilling Company sold its assets to Mitchell Energy Corporation and Butler Drilling Corporation became the successor corporation. Duncan Butler also served as president of the successor corporation. The contract provided that employment of appellant would continue for a period of three consecutive years beginning September 1, 1974, and ending August 31, 1977. Appellant would be paid in specified semi-monthly installments with the amount of such payments to increase yearly in specified sums. Additional labor performed by appellant would be billed and paid for at an hourly rate of $10 per hour. Appellee agreed to provide either a vehicle or travel reimbursement to appellant as well as shop space, utilities and parking facilities. Appellee further agreed to furnish all repair and replacement parts; appellant was to purchase these parts and bill appellee monthly for them at cost plus fifteen percent. The contract contained the following *837 provisions which relate to the liquidated damages claimed by appellant in this appeal: “Because the services to be performed by Ra-Comm are personal services, the death of William J. Bethel, Jr., or such bad health or accident as shall render him unable to fully perform said services, shall be grounds to relieve both parties from any further obligations concerning the contract. In the event that Butler breaches the contract and fails to perform for any reasons other than those set out above, then it shall pay as liquidated damages to Ra-Comm the balance of the monthly installment payments set out above.” It was undisputed the contract was terminated by appellee on October 24, 1975, but there was a dispute as to whether such termination was with or without good cause. The jury found in answer to special issues that Butler Drilling Corporation assumed and ratified appellant's contract with Butler Drilling Company, that appellant was an independent contractor from October 1, 1974 to October 24, 1975, that appellant was terminated, that Butler Drilling Corporation did not have © 2015 Thomson Reuters. No claim to original U.S. Government Works. 2 Bethel v. Butler Drilling Co., 635 S.W.2d 834 (1982) good cause to terminate appellant, that Duncan Butler was authorized by Butler Drilling Company to enter into the contract, that $14,500 would reasonably and fairly compensate appellant for the termination of the contract, that Butler Drilling Corporation did not convert any of appellant's personal property on or about October 24, 1975, that appellant did not furnish Butler Drilling Corporation any equipment for which he was not paid, that reasonable attorney's fee for appellant's attorneys was $12,000, and that appellant did not convert assets of Butler Drilling Corporation to his own use. The court on appellee's Motion disregarded the jury finding that appellant did not convert any of appellee's assets and rendered final judgment in favor of appellant for $10,189.72 by taking the jury's damage answer of $14,500.00 and subtracting the conversion offset admitted by appellant in the amount of $4,310.28. The court also awarded $12,000.00 in attorney's fees on the jury finding, and denied appellant's Motion for Judgment on attorney's fees of $16,500.00. The court further refused appellant's Motion for Judgment for liquidated damages of $41,825.00 and pre-judgment interest on the liquidated sum. From this final judgment appellant appeals. Appellant's seven points of error are that the trial court erred in denying appellant's Motion for Judgment for liquidated damages provided by the contract and that there was no evidence and insufficient evidence to prove the liquidated damage clause was a penalty; that the trial court erred in denying appellant's Motion for Judgment for $16,500.00 attorney's fees and that there was no evidence and insufficient evidence to support the jury finding of $12,000.00 attorney's fees; and that the trial court erred in not awarding pre-judgment interest from January 1, 1976. [1] [2] [3] [4] [5] With respect to appellant's first three points of error, we construe the language employed in the contract in question to be a penalty, as a matter of law as pleaded by the appellee in its trial pleading, and as construed by the trial court, rather than a valid liquidated damage provision as contended by appellant. The liquidated damage provision is not triggered solely by contract termination and nonpayment of monthly rentals by Butler. The liquidated damage provision was not carefully drawn and as it was written, it applied equally to any breach of any provision of the contract by appellee irrespective of the importance or triviality of such breach. The liquidated damage provision of the contract in question, as written, would apply with equal force for such trivial breaches by appellee Butler as failing to pay utilities, provide parking space or pay an additional hourly labor charge of $10.00. Under the liquidated damage clause as written, appellant would be entitled to the full amount of monthly payments for the full term of the contract irrespective of the nature of the breach or appellant's actual loss or damage. Because the contract provides the same reparation *838 for the breach of a trivial or comparatively unimportant stipulation as for the breach of the most important one or of the whole contract, we hold that the parties have not adhered to the rule of just compensation and that the provision is a penalty. The leading case on the subject is Stewart v. Basey, 150 Tex. 666, 668, 245 S.W.2d 484 (Tex.1952), which involved a building lease providing for monthly rentals of $325.00 per month. Prior to the © 2015 Thomson Reuters. No claim to original U.S. Government Works. 3 Bethel v. Butler Drilling Co., 635 S.W.2d 834 (1982) completion of the lease term, the lessee vacated the building and failed to pay the monthly rentals as provided in the written contract. The lease contract of the parties included a liquidated damage provision that provided “(t)he failure of Lessee to make said payment or payments or the breach of this contract otherwise by him shall render him liable to Lessors, as agreed liquidated damages, the sum of One Hundred Fifty ($150) Dollars per month for each and every month of the unexpired term...” (Emphasis added.) Stewart v. Basey, supra at 485. In holding that such stipulated damage provision would be treated as a penalty the Texas Supreme Court pointed out that the liquidated damage provision was not carefully drawn and was not limited to the breach of any one particular covenant, but rather provided for the same reparation for the breach of a trivial or comparatively unimportant stipulation as for the breach of the most important one of the contract. Therefore, the Supreme Court reasoned, the provision did not adhere to the rule of just compensation. The court then reversed and remanded the case to determine the amount of actual damages to which lessor was entitled for the breach. The court emphasized that damages to be enforceable as liquidated damages must be uncertain and the stipulation must be reasonable. The right of competent parties to make their own bargains is not unlimited. The universal rule for measuring damages for the breach of a contract is just compensation for the loss or damage actually sustained. A party has no right to have a court enforce a stipulation which violates the principle underlying the rule. Again, the Supreme Court in Stewart v. Basey, supra, at 486, stated: “The true theory is well expressed in Williston on Contracts, Revised Edition, Sec. 779, p. 2192, in this language: ‘But as has been seen, the chief, almost the only, means of determining whether the parties in good faith endeavored to assess the damages is afforded by the amount of damages stipulated for, and the nature of the breach upon which the stipulation was agreed to become operative...’ ” Finally, the Supreme Court quoted from the comments from Restatement of Contracts, Sec. 339, subsection (1) as follows: “b. Contracts are frequently made in which performance of very different degrees of importance and value are promised and one large sum of money is made payable as damages for any breach whatever. Since such a contract promises the same reparation for the breach of a trivial or comparatively unimportant stipulation as for the breach of the most important one or of the whole contract, it is obvious the parties have not adhered to the rule of just compensation. In this matter neither the intention of the parties nor their expression of intention is the governing consideration. The payment promised may be a penalty, though described expressly as liquidated damages, and vice versa.” Appellant here urges that the liquidated damage provision in the contract in question should be enforced in this case because of the contract termination by appellee without good cause and © 2015 Thomson Reuters. No claim to original U.S. Government Works. 4 Bethel v. Butler Drilling Co., 635 S.W.2d 834 (1982) his nonpayment of monthly rentals, but that it should not be enforced for trivial breaches of the contract. We recognize it is a stringent case on the facts from appellant's viewpoint, but we do not believe that we are empowered to pick and choose which breaches are enforceable by liquidated damages since the provision plainly states it is applicable to all breaches of the contract and the Supreme Court in Stewart v. Basey has so directly spoken. Further, if there is any doubt on the question under the language of the instrument, that doubt must be resolved against appellant who prepared the instrument. *839 American Lease Plan v. Ben-Kro Corporation, 508 S.W.2d 937, 942 (Tex.Civ.App.-Houston (1st Dist.) 1974, writ ref'd n.r.e.). Another similar case in point is Krenek v. Wang Laboratories, Inc., 583 S.W.2d 454 (Tex.Civ.App.-Waco 1979, no writ) where the lessor brought action against lessee for failure to make monthly payments under an equipment lease and sought to recover liquidated damages as provided in the contract. The Waco Court, in reversing the trial court, followed Stewart v. Basey, supra, and held the provision was a penalty because it could be triggered by a breach of lesser covenants in the lease and not just by a breach of a major covenant such as nonpayment of rentals. Still another case in point is Servisco v. Tramco, Inc., 568 S.W.2d 434 (Tex.Civ.App.-Texarkana 1978, writ ref'd n.r.e.) which relied on Stewart v. Basey, supra, and distinguished a case relied upon by appellant in the instant case, Oetting v. Flake Uniform and Linen Service, 553 S.W.2d 793 (Tex.Civ.App.-Fort Worth 1977, no writ). Appellant relies principally on Oetting v. Flake Uniform & Linen Service, supra. That case is distinguishable from the instant case because as the Fort Worth Court specifically pointed out at page 796 of the opinion, the liquidated damage provision in that case could be triggered only by the failure of the customer to pay the monthly service charge and the termination of the contract by the supplier because of nonpayment by the customer. The Fort Worth Court pointed out that the liquidated damage clause as written could not be triggered by any lesser breaches, but could only be triggered by the most major breach of all, nonpayment. Appellant also cites Johnson Engineers, Inc. v. Tri-Water Supply Corporation, 582 S.W.2d 555 (Tex.Civ.App.-Texarkana 1979, no writ) and R.M. Robinson v. Granite Equipment Leasing Corporation, 553 S.W.2d 633 (Tex.Civ.App.-Houston (1st Dist.) 1977, writ ref'd n.r.e.). In Johnson Engineers Inc., v. Tri-Water Supply Corporation, supra, which was a suit for payment under a construction contract, liquidated damages were pled as an offset to cover the period of delay beyond the agreed completion date of the contract. There was no defensive pleading that the liquidated damage provision was a penalty, as was done in the instant case, and there was no evidence of actual damages to show any disproportionate amount of actual damages to stipulated damages. More importantly, the liquidated damage clause did not apply to major and trivial covenants under the contract, but applied only to the payment of $100.00 per day for each day of delay by the appellant after the allotted construction time under the contract. R.M. Robinson v. Granite Equipment Leasing Corporation, supra, was a nonjury trial for liquidated damages by reason of defendant-lessee's default of monthly payments under a personal property lease. The liquidated damage provision requiring payment of all unaccrued rentals was triggered only by the defendant-lessee's default in timely payment of such monthly rentals, and not by any breach of any minor or trivial covenant © 2015 Thomson Reuters. No claim to original U.S. Government Works. 5 Bethel v. Butler Drilling Co., 635 S.W.2d 834 (1982) in the lease. Further, there was no defensive pleading that it was a penalty and such defense was waived. Appellant's first three points of error are overruled. [6] [7] Appellant contends by his next three points of error that the trial court erred in denying appellant's Motion for Judgment for attorney's fees in the amount of $16,500 and allowing only $12,000 attorney's fees on the jury finding, because there was no evidence or insufficient evidence to support such finding. Appellant's trial attorney testified that he was familiar with fees charged for services similar to those rendered in this case and that “it is my opinion that ... a proper legal fee and reasonable fee for the same or similar circumstances in Harris County would be approximately $16,500.” There was no cross-examination of the witness nor was there any contradictory attorney fee expert opinion evidence produced by appellee. The jury found $12,000 would be a reasonable attorney's fee. Appellant recognizes the unbroken long line of case authority holding that the amount of attorney's fees is a fact issue even when no contradictory evidence is offered. Further, the trier of fact may determine the credibility of the witness *840 and accept or reject his expert opinion testimony in whole or in part. However, appellant urges such authority was changed by the June 6, 1979, amendment to Tex.Rev.Civ.Stat.Ann. art. 2226 (Vernon Supp.1981) which provided: “... The usual and customary fees in such cases shall be presumed to be reasonable, but such presumption may be rebutted by competent evidence...” (Emphasis added). The amendment further provides the act is to be liberally construed to promote its underlying purposes. In addition, it is remedial in nature and is intended to apply to all pending and future actions regardless of the time of institution or of the accrual of any cause of action asserted. Thus, the 1979 amendment applies to the instant case. Appellant contends the presumption found in Article 2226, as amended, mandates and makes conclusive an award of attorney's fees in the amount testified to by appellant's counsel in the absence of contradictory evidence. No cases have been cited to us by the parties nor have we found any construing the effect or meaning of this presumption since the 1979 amendments. Appellee cites two cases, Law Offices of James R. Bass, Inc. v. Bryan, 609 S.W.2d 652 (Tex.Civ.App.-San Antonio 1980, no writ), and Graves v. Sommerfeld, 618 S.W.2d 952 (Tex.Civ.App.-Waco 1981, no writ). Both of these cases hold the issue of amount of attorney's fees is a fact issue, but neither case discusses the 1979 amendment, and it is not shown from the opinions whether the cases were tried before or after the effective date of the 1979 amendments. See also: Neal v. Neal, 606 S.W.2d 729 (Tex.Civ.App.-Beaumont 1980, no writ) to the same effect. A look at the legislative history relating to the presumptions on attorney's fees under Article 2226 is helpful. In 1971, the 62nd Legislature amended Article 2226 to provide the then current State Bar Minimum Fee Schedule shall be prima facie evidence of reasonable attorney's fees, and in nonjury cases the court may take judicial knowledge of the minimum fee schedule and of the contents of the case file in determining the amount of attorneys fees without hearing further evidence. The cases © 2015 Thomson Reuters. No claim to original U.S. Government Works. 6 Bethel v. Butler Drilling Co., 635 S.W.2d 834 (1982) following that amendment uniformly held that the bar fee schedule was not conclusive even in the absence of contradictory proof but was only prima facie evidence of reasonable attorney's fees. Aztec Pipe and Supply Company Inc. v. Sundance Oil Company, 568 S.W.2d 401 (Tex.Civ.App. Houston (1st Dist.) 1978, writ ref'd n.r.e.). Also, opinion testimony as to the value of services was held not conclusive, and in jury cases if reliance was not made on the bar fee schedule, there had to be evidence of the reasonableness of attorney's fees to support such an award. Dorsey v. Aguirre, 552 S.W.2d 576 (Tex.Civ.App.-Waco 1977, writ ref'd n.r.e.). In summary judgment cases, the courts also uniformly held there could be no summary judgment as to the amount of reasonable attorney's fees because the uncontradicted opinion of an expert was only an opinion, thereby raising only a fact issue on the amount. McFadden v. Bresler Malls Inc., 526 S.W.2d 258 (Tex.Civ.App.-Austin 1975, no writ), appeal after remand, 548 S.W.2d 789 (Tex.Civ.App.-Austin 1975, no writ); Coward v. Gateway National Bank of Beaumont, 525 S.W.2d 857 (Tex.1975). Effective January 1, 1978, however, Tex.R.Civ.P. 166-A was amended to provide that a Summary Judgment may be based on uncontroverted testimonial evidence 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 easily controverted. Thus, it became possible to obtain a Summary Judgment on the issue of reasonable attorney's fees on the basis of uncontradicted Summary Judgment evidence. Bado Equipment Co., Inc. v. Ryder Truck Lines Inc., d/b/a Ranger Division, 612 S.W.2d 81, 83 (Tex.Civ.App.-Houston (14th Dist.) 1981, writ ref'd n.r.e.). Effective August 29, 1977, the 65th Legislature deleted the provision in Art. 2226 *841 which had provided that the State Bar Minimum Fee Schedule shall be prima facie evidence of reasonable attorney's fees and that the court in a nonjury case may take judicial knowledge of the schedule and the contents of the case file in determining the amount of reasonable attorney's fees without further evidence. That deletion was prompted by the United States Supreme Court decision in Goldfarb v. Virginia State Bar, 421 U.S. 773, 95 S.Ct. 2004, 44 L.Ed.2d 572 (1975). Thereafter, in every case positive proof by opinion testimony of reasonableness was required to support the award of attorney's fees in a jury or nonjury trial. In the absence of testimony that such fees were reasonable, no such attorney's fees were recoverable. Brown v. De La Garza Service Center, Inc., 576 S.W.2d 134 (Tex.Civ.App.-Waco 1978, no writ). Finally, the 66th Legislature, effective June 6, 1979, amended the current Article 2226 to provide that usual and customary fees in such cases shall be presumed to be reasonable, and also added that in a jury or nonjury case if the issue of attorney's fees is submitted to the court for determination, the court may in its discretion take judicial knowledge of the usual and customary fees in such matters and of the contents of the case file without receiving further evidence. This raises the question of whether the reasonableness of such an unrebutted presumption of usual and customary fees under the 1979 amendment should be treated differently than the 1971 prima facie evidence © 2015 Thomson Reuters. No claim to original U.S. Government Works. 7 Bethel v. Butler Drilling Co., 635 S.W.2d 834 (1982) provision of reasonableness under the State Bar Minimum Fee Schedule in a trial on the merits. Should it be treated as a true presumption which entitles one to an instructed verdict in the absence of evidence to the contrary? Farley v. M M Cattle Company, 529 S.W.2d 751, 756 (Tex.1975); Sudduth v. Commonwealth County Mutual Ins. Co., 454 S.W.2d 196, 198 (Tex.1970). [8] [9] [10] We hold that Article 2226, as amended, does not render conclusive and mandatory the award of a specific sum of attorney's fees based on uncontradicted expert opinion evidence of reasonableness or uncontradicted evidence of “usual and customary fees.” We believe the effect of the statute is to presumptively provide the element of “reasonableness” of attorney's fees where there is uncontradicted testimony of what “the usual and customary fees” are and that such evidence will support an award up to that amount, but that such evidence is not conclusive and mandatory. Where the issue of attorney's fees is determined by the court, whether it is a jury or nonjury case, the court is authorized to take judicial notice of what the usual and customary fees are in such matters and of the contents of the case file without hearing further evidence. We do not believe this means, or that it was intended, that, the court, having taken judicial notice of “usual and customary fees,” is mandated to award that specific amount in every instance. Rather, we think the court is authorized to make an award up to that amount. Neither do we believe the statute mandates the award of a specific sum in a jury or nonjury case where there is unrebutted direct testimony of “the usual and customary fees,” or of unrebutted opinion testimony of “reasonable attorneys fees” whether or not they are the usual and customary fees. Under the current provisions of Tex.R.Civ.P. 166-A, the court may render summary judgment on attorney's fees if the affidavit or other summary judgment evidence meets the clear, positive, direct and uncontradicted requirements of that rule. On the other hand, as stated above, we do not believe Tex.Rev.Civ.Stat.Ann. art. 2226 (Vernon Supp.1981) makes conclusive or mandatory in a trial on the merits the award of a specific sum based on uncontradicted evidence of “the usual and customary fees.” This holding and interpretation will reconcile the range of possible attorney's fee awards in cases where there is uncontradicted evidence of “the usual and customary fees,” with the cases where there may be no evidence of “usual and customary fees” but there is uncontradicted opinion evidence of “reasonableness” of attorney's fees. Also, this view of the meaning and application of Art. 2226 would apply equally to a default judgment situation where there is always *842 uncontradicted oral testimony or uncontradicted affidavit proof on attorney's fees. We do not believe Art. 2226 was intended to render conclusive or mandate a specific award of attorney's fees in default judgment situations. [11] If the Legislature had intended uncontradicted opinion evidence on reasonableness of attorney's fees or uncontradicted evidence of “usual and customary” fees to be conclusive and mandate the award of a specific sum, it could easily have so stated. In the absence of such a clear statement, we do not believe the Legislature so intended. The previous amendments all appear to relate to the question of supplying the element of “reasonableness” and of prima facie proof, and we believe this is also the thrust of the June 6, 1979, amendment. We hold Article 2226, as © 2015 Thomson Reuters. No claim to original U.S. Government Works. 8 Bethel v. Butler Drilling Co., 635 S.W.2d 834 (1982) amended, and the state of the evidence does not mandate the award of $16,500.00 attorney's fees in the instant case and that the jury answer of $12,000.00 was authorized and supported by the evidence. Additionally, in the case at bar, the opinion of appellant's trial attorney on attorney's fees was not couched in terms of “the usual and customary fees” which is the language used in Article 2226 to invoke the presumption of reasonableness. Further, the attorney's opinion testimony of the amount was not clear, direct and positive. The appellant's trial attorney opined that a reasonable fee for these services would be “approximately $16,500.00.” The uncontradicted evidence did not indicate what “the usual and customary fees” were, but rather supplied the element of “reasonableness” and stated a reasonable fee would be approximately $16,500.00. Appellant's points of error four, five and six are overruled. [12] [13] [14] [15] Appellant's seventh point of error contends the trial court erred in denying 6% pre-judgment interest from January 1, 1976, under the provisions of Tex.Rev.Civ.Stat.Ann. art. 5069-1.03 (Vernon Supp.1981). That statute provides: “When no specified rate of interest is agreed upon by the parties, interest at the rate of six percent per annum shall be allowed on all accounts and contracts ascertaining the sum payable, commencing on the thirtieth (30th) day from and after the time when the sum is due and payable.” Where pre-judgment interest is sought on the basis of a written contract fitting the description of Article 5069-1.03 an award of this statutory interest, or interest eo nomine as it is known, may be supported by a prayer for general relief. See e.g., The Republic National Bank of Dallas v. Northwest National Bank of Fort Worth, 578 S.W.2d 109 (Tex.1978) (allowing pre-judgment interest on a letter of credit), and Miner-Dederick Construction Corporation v. Mid-County Rental Service, Inc., 603 S.W.2d 193 (Tex.1980) (allowing pre-judgment interest on construction contracts). It is distinguished from a situation where pre-judgment interest is sought at common law as an element of damages, in which case the plaintiff must have a pleading to support pre- judgment interest. Black Lake Pipe Line Company v. Union Construction Company, Inc., 538 S.W.2d 80 (Tex.1976) (quantum meruit under a construction contracts); Pickett v. J. J. Willis Trucking Company, 624 S.W.2d 664 (Tex.Civ.App.-Houston (14th Dist.) 1981, writ ref'd n.r.e.); Zuider Zee Oyster Bar, Inc. v. Martin, 503 S.W.2d 292 (Tex.Civ.App.-Fort Worth 1973, writ ref'd n.r.e.); City of Galveston v. Russo, 508 S.W.2d 882 (Tex.Civ.App.-Houston (14th Dist.) 1974, writ ref'd n.r.e.). In either case, pre-judgment interest is recoverable as a matter of right where an ascertainable sum of money is determined to have been due and payable at a date certain prior to judgment. The Republic National Bank of Dallas v. Northwest National Bank of Fort Worth, supra; Black Lake Pipe Line Company v. Union Construction Company, Inc., supra. Pre-judgment interest is that interest calculated on a sum payable to the plaintiff from the time of his loss or injury to date of judgment. The Republic National Bank of Dallas v. Northwest National Bank of Fort © 2015 Thomson Reuters. No claim to original U.S. Government Works. 9 Bethel v. Butler Drilling Co., 635 S.W.2d 834 (1982) Worth, supra. Appellant did not have a specific pleading for pre-judgment interest in the instant case, but he *843 had a general prayer for relief which is sufficient for the award of pre-judgment interest under Art. 5069-1.03. The Republic National Bank of Dallas v. Northwest National Bank of Fort Worth, supra, at 116. [16] In the instant case, the suit was for recovery of damages based on the breach of a written contract. The amount of appellant's damages cannot be ascertained on the basis of the liquidated damage clause because it has been construed as a penalty provision. However, the contract in question ended August 31, 1977, and the actual damages were found by the jury and were ascertained in the damage issue as a definite sum as of September 1, 1977, less the conversion offset admitted by appellant. We hold that appellant was entitled to recover 6% pre-judgment interest under Article 5069-1.03 on the sum of $10,189.72 from October 1, 1977, pursuant to the thirty day provision of that statute to date of judgment on June 9, 1980. [17] Appellee asserts ten cross-points of error. In his first two cross-points, he argues the evidence conclusively showed as a matter of law that Butler Drilling Corporation did not assume or ratify the contract, or that the jury finding to special issue number one was so against the great weight and preponderance of the evidence as to be manifestly unjust. The contract in question indicates it was signed and notarized on August 24, 1974, during which period of time negotiations were being had for purchase of the assets of Butler Drilling Company. It was signed by Duncan Butler, President of Butler Drilling Company, who also was president of the successor corporation, Butler Drilling Corporation. There was evidence the contract in question was listed as an asset of Butler Drilling Company when the assets were sold and the successor corporation Butler Drilling Corporation acquired them. The attorney for the purchaser discussed the contract with Mr. McClain, Vice- President of Butler Drilling Company, who also later became vice-president of the successor corporation, and the attorney testified Mr. McClain told him the contract was oral. Butler Drilling Corporation abided by and operated under the contract for a year from October 1, 1974, to October 24, 1975, when it terminated the contract. In addition, a letter from Mr. McClain was in evidence which referred to the written contract while he was acting as vice-president of Butler Drilling Corporation. Appellant contends that Duncan Butler actually signed the contract sometime after August 24, 1974, and that Butler Drilling Corporation thought the contract was an oral month to month arrangement rather than a written contract. While the evidence is conflicting, we find there was sufficient evidence to support the jury answer to special issue number one and said answer was not against the great weight and preponderance of evidence. Appellee's first and second cross- points are overruled. [18] In its cross-points three and four, appellee contends the evidence conclusively showed as a matter of law that Duncan Butler did not have authority to sign the contract on behalf of Butler Drilling Company, or that the jury answer to special issue number five to such effect was so against the great weight and preponderance of the evidence as to be manifestly unjust. Appellee © 2015 Thomson Reuters. No claim to original U.S. Government Works. 10 Bethel v. Butler Drilling Co., 635 S.W.2d 834 (1982) contends there is no authority shown because the charter, by-laws and corporate minutes do not reflect the granting of any authority and the contract in question is not a matter in the ordinary and usual course of company business indicating inherent apparent authority. The special issue included both actual and apparent authority. The only Board of Directors for the company was Joe K. Butler, chairman of the Board; Duncan Butler, President; and Lee McClain, Vice-President. Joe K. Butler testified that he instructed Duncan Butler and Lee McClain to negotiate a contract with appellant. The by-laws of the corporation provide the President has the power to employ and discharge all employees and agents for the company. Both Butler Drilling Company and Butler Drilling Corporation operated and acted under the contract for more than a year, which provided for maintenance of the company's radio equipment, an activity *844 in the every day operation of the company. This was the same activity which had been carried on by appellant for Butler Drilling Company on a month to month oral basis for nine to ten years prior to the date of the written contract. Appellee's cross-points three and four are overruled. [19] [20] [21] In its fifth and sixth cross-points, appellee says the evidence conclusively shows as a matter of law appellant is judicially estopped from claiming unlawful termination by reason of testimony given in another lawsuit where he stated he quit, or that the answer by the jury to special issue number three that plaintiff was terminated is so against the great weight and preponderance of the evidence as to be manifestly unjust because of this prior testimony of plaintiff. While appellant appeared to make conflicting statements as to whether he quit or was terminated, he later explained the discrepancy. He said he was confused and thought he was being asked about the other corporation, not Butler Drilling Corp., and equivocated on the earlier testimony that he quit. One of the requirements for application of the doctrine of judicial estoppel is that the statement must be deliberate, clear and unequivocal. American Savings and Loan Association of Houston v. Musick, 531 S.W.2d 581, 589 (Tex.1975). The elements related to judicial estoppel are not shown conclusively or by the overwhelming weight and preponderance of the evidence, and we believe the question went to the weight of the evidence. Further, no one contended appellant quit at the instant trial. Both parties to the instant trial agreed appellant was terminated by appellee. The contested issue was whether the termination was with or without good cause. Appellee's cross- points five and six are overruled. [22] Appellee's cross-points seven and eight assert that as a matter of law appellant converted property of the value of $6420.28, rather than the $4300.00 awarded by the court, and that by the great weight and preponderance of evidence, the jury should have answered $6420.28 to the conversion issue in special issue number thirteen. One of the items of conversion was a General Electric base station radio for which appellee had paid appellant but had never received. Appellant admitted by pleading and evidence this conversion of payment and this was the item which the trial court offset against the damages awarded appellant when the court disregarded the jury answer to special issue number thirteen. The other items contended by appellant to establish conversion as a matter of law or by the overwhelming weight and preponderance of the evidence relate to © 2015 Thomson Reuters. No claim to original U.S. Government Works. 11 Bethel v. Butler Drilling Co., 635 S.W.2d 834 (1982) evidence of appellee's padding of an expense account of $100.00 per month for approximately ten (10) months and the removal of two A.C. and D.C. test stands by appellant valued at $600.00 each. The burden of proof on the issue was on appellee and from a review of the evidence we do not believe conversion or the specific amounts claimed were established as a matter of law or by an overwhelming weight and preponderance of the evidence. We overrule appellee's seventh and eighth cross-points. [23] Appellee's final two cross-points of error assert the evidence conclusively established as a matter of law appellant was terminated for good cause and that special issue number four should not have been submitted to the jury, or else the jury's answer thereto should have been disregarded. Further, appellee contends that the jury finding to special issue number four was so against the great weight and preponderance of evidence as to be manifestly unjust. The evidence was in conflict on the question but in our view it does not show as a matter of law or by the great weight and preponderance of the evidence that appellant was terminated for good cause due to alleged insubordination and misconduct. Appellee's cross-points nine and ten are overruled. The judgment of the trial court is reformed to provide for six percent prejudgment interest on the sum of $10,189.72 from October 1, 1977, to date of judgment on June 9, 1980 with post judgment interest as provided by law. The judgment of the trial court is otherwise affirmed. End of Document © 2015 Thomson Reuters. No claim to original U.S. Government Works. © 2015 Thomson Reuters. No claim to original U.S. Government Works. 12 Bethel v. Butler Drilling Co., 635 S.W.2d 834 History (1) Direct History (1) 1. Bethel v. Butler Drilling Co. 635 S.W.2d 834 , Tex.App.-Hous. (14 Dist.) , May 27, 1982 , writ refused n.r.e. ( Sep 15, 1982 ) © 2015 Thomson Reuters. No claim to original U.S. Government Works. 13 CDS Enterprises, Inc. v. Myrad Real Estate, Inc., Not Reported in S.W.2d (1999) 1999 WL 548226 1999 WL 548226 Only the Westlaw citation is currently available. NOTICE: NOT DESIGNATED FOR PUBLICATION. UNDER TX R RAP RULE 47.7, UNPUBLISHED OPINIONS HAVE NO PRECEDENTIAL VALUE BUT MAY BE CITED WITH THE NOTATION “(not designated for publication).” Court of Appeals of Texas, Houston (14th Dist.). CDS ENTERPRISES, INC. d/b/a Texcon, Appellant, v. MYRAD REAL ESTATE, INC. and Fountainhead Development Corp., Inc., Appellees. No. 14-97-00197-CV. | July 29, 1999. On Appeal from the 361st District Court, Brazos County, Texas; Trial Court Cause No. 42,016-361. Before Justices ANDERSON, EDELMAN, and SEARS. * OPINION ROSS A. SEARS, Justice. *1 CDS Enterprises, Inc. d/b/a Texcon (Texcon) appeals judgment in favor of Myrad Real Estate, Inc. (Myrad) and Fountainhead Development Corp., Inc. (Fountainhead). Texcon brings eleven points of error, while Myrad brings four cross-points. We affirm in part as modified and reverse and render in part. I. Background Myrad and Fountainhead are residential real estate developers. Fountainhead is a wholly owned subsidiary of Myrad. Texcon is a construction contractor. On June 23, 1994, Myrad entered into a written contract with Texcon for the construction of roadway, drainage, sewer, and waterline improvements to the Cat Hollow subdivision in College Station, Texas (the Cat Hollow contract). On October 6, 1994, Fountainhead entered into a written contract with Texcon for the construction of similar improvements to the Cypress Meadow subdivision and the Hidden Hollow subdivision, © 2015 Thomson Reuters. No claim to original U.S. Government Works. 1 CDS Enterprises, Inc. v. Myrad Real Estate, Inc., Not Reported in S.W.2d (1999) 1999 WL 548226 and for improvements to Rock Prairie Road, also located in College Station (the Springbrook contract). Texcon claimed it entered into several oral agreements with Myrad and Fountainhead for additional work outside the written contracts and was never paid for this work. Consequently, Texcon filed three mechanic's and materialman's liens on Cat Hollow, Cypress Meadow, and Hidden Hollow. Subsequently, Myrad and Fountainhead sued Texcon, each asserting a claim for breach of contract and seeking actual and liquidated damages for the untimely completion of the Cat Hollow and Springbrook contracts. Furthermore, Myrad and Fountainhead each sought a declaratory judgment that Texcon's liens were invalid and unenforceable because they were not filed timely. Myrad also brought a claim for fraud, alleging Texcon falsely represented on April 19, 1995, that it was accepting payment in full and had no outstanding claims for work performed before such date. Texcon filed a counterclaim, alleging breach of contract for Myrad and Fountainhead's failure to pay for additional work performed pursuant to oral agreements. Texcon also brought a claim for fraud, alleging several misrepresentations, including: (1) Myrad and Fountainhead wanted an informal working relationship in which they could request that work be performed by Texcon on an as needed basis and Texcon would be compensated for such work; and (2) Texcon would not be subject to any penalties as a result of any delays or interference caused by Myrad, Fountainhead or their other contractors. Texcon also sought (1) a declaratory judgment that its liens were valid, and (2) the foreclosure of its liens and the sale of the properties. At trial, the jury found: (1) Texcon did not breach the Springbrook contract; (2) Texcon breached the Cat Hollow contract and awarded Myrad $10,000.00 for the cost of obtaining a bon [Text truncated at 120,000 characters. The full text is on the page linked above.] --- Source: Frix Law Library, https://www.frixlaw.com/law-library/cases/4059716. Public record. Not legal advice.