Opinion
NO. 14-16-00405-CV
03-14-2017
CYBIZ, INC. D/B/A DRS COMPUTER SERVICES, Appellant v. SUSAN C. GASKILL, M.D., P.A. D/B/A VICTORY BREAST DIAGNOSTICS & WOMEN'S IMAGING, Appellee
On Appeal from the 405th District Court Galveston County, Texas
Trial Court Cause No. 13-CV-0874
MEMORANDUM OPINION
In this dispute arising from two contracts between the parties, the plaintiff appeals from the judgment rendered on the jury's verdict, but has not included a record of the trial proceedings. The plaintiff instead contends the pleadings establish that (a) it is entitled to judgment on its open-account claim, (b) the defendant lacked standing to assert its counterclaims, (c) the counterclaims are barred by limitations, and (d) the damages awarded on two of the defendant's counterclaims constituted a double recovery for a single injury. In addition, the appellant contends that the trial court erroneously awarded post-judgment interest at higher rate than the law allows. Because the defendant's alleged lack of standing is merely a misnomer and none of the remaining appellate complaints have been preserved for our review, we affirm the trial court's judgment.
I. Background
Cybiz Inc. d/b/a DRS Computer Services ("Cybiz") sued Susan C. Gaskill MD, PA d/b/a Victory Breast Diagnostics & Women's Imaging ("Victory") for breach of a 2009 IT services agreement. Cybiz also couched this claim as a suit on an open account. In response, Victory raised counterclaims arising from a 2010 agreement, alleging causes of action for breach of contract, fraud, and money had and received.
The jury found that Cybiz and Victory entered into the 2009 IT services contract; that both parties failed to comply with the agreement; and that Cybiz was the first to breach the contract. Regarding Victory's claims, the jury found that the parties agreed that Victory would purchase, and Cybiz would deliver, computer equipment and software. After finding that Cybiz failed to comply with the contract, the jury assessed Victory's actual damages at $31,273.92. It also found that the reasonable fees for Victory's necessary attorney's services through trial were $30,000, and assessed further attorney's fees of up to $40,000, depending on the extent of appellate proceedings. The trial court rendered judgment on the verdict, and Cybiz now appeals.
II. The Omitted-Record Presumption
In an appeal from a jury trial, the absence of a reporter's record can be fatal. See Kroger Co. v. Am. Alternative Ins. Corp., 468 S.W.3d 766, 768 (Tex. App.— Houston [14th Dist.] 2015, no pet.). Absent compliance with the rules governing agreed or partial records—which did not occur here—"we must presume that the omitted portions of the record are relevant and would support the judgment." Mason v. Our Lady Star of the Sea Catholic Church, 154 S.W.3d 816, 822 (Tex. App.—Houston [14th Dist.] 2005, no pet.).
If the parties have filed a written stipulation agreeing on the contents of a partial record, then we will presume that the agreed record contains "all evidence and filings relevant to the appeal." TEX. R. APP. P. 34.2. The parties also have the option to file an agreed statement of the case. See TEX. R. APP. P. 34.3. Even without an agreement between the parties, the appellant can request a partial reporter's record and "include in the request a statement of the points or issues to be presented on appeal and will then be limited to those points or issues." TEX. R. APP. P. 34.6(c)(1). The record before us, however, contains neither an agreement between the parties nor a statement of the points or issues to be presented on appeal.
The need for a complete reporter's record may be most immediately apparent in the threshold question of error preservation. A party must preserve most complaints of error by raising the issue in the trial court through a timely and sufficiently specific request, objection, or motion. See TEX. R. APP. P. 33.1(a). Having raised the issue, the complaining party also must either obtain a ruling on it or object to the trial court's failure to rule. See id. If the record does not show that the party raised the issue and obtained or pursued a ruling in the trial court, an appellate court usually is unable to address the merits of the complaint on appeal. See Fed. Deposit Ins. Corp. v. Lenk, 361 S.W.3d 602, 604 (Tex. 2012) (explaining that the appellate courts generally lack jurisdiction to address unpreserved complaints of error); Valley Baptist Med. Ctr. v. Gonzalez, 33 S.W.3d 821, 822 (Tex. 2000) (per curiam) (stating that Texas courts lack jurisdiction to render advisory opinions); Maxim Crane Works, L.P. v. Berkel & Co. Contractors, Inc., No. 14-15-00614-CV, 2016 WL 4198138, at *2 (Tex. App.—Houston [14th Dist.] Aug. 9, 2016, pet. denied) (mem. op.) (overruling issues without addressing the merits where the limited record failed to show that the appellant preserved error).
Questions of jurisdiction are one of the exceptions to this general rule. The question of subject-matter jurisdiction can be raised for the first time on appeal. See RSL Funding, LLC v. Pippins, 499 S.W.3d 423, 429 (Tex. 2016) (per curiam). Because it is component of subject-matter jurisdiction, a party's standing also can be challenged for the first time on appeal. See id. We therefore begin our analysis with this complaint.
III. Standing
Cybiz contends that the counterclaims against it were owned by Victory, but were raised by Gaskill in her individual capacity. Because the counterclaims belonged not to Gaskill but to her company, Cybiz maintains that Gaskill lacked standing to assert them.
Cybiz's premise that the counterclaims were brought by Gaskill is based on one sentence in the pleading raising the claims: "NOW COMES Dr. Susan C. Gaskill d/b/a Victory Breast Diagnostics & Women's Imaging (hereinafter 'Victory Breast Diagnostics'), Counter-petitioner in the above-entitled and numbered cause, and files this Original Counterclaim . . . ." According to Cybiz, this statement conclusively establishes that the counterclaims were brought by a person who lacked standing to do so.
We conclude, however, that this is a simple misnomer. Misnomer occurs "when a party misnames itself or another party, but the correct parties are involved." In re Greater Hous. Orthopaedic Specialists, Inc., 295 S.W.3d 323, 325 (Tex. 2009) (orig. proceeding) (per curiam). "When the correct party sues or is sued under the incorrect name, 'the court acquires jurisdiction after service with the misnomer if it is clear that no one was misled or placed at a disadvantage by the error.'" Reddy P'ship/5900 N. Freeway LP v. Harris Cty. Appraisal Dist., 370 S.W.3d 373, 376-77 (Tex. 2012) (per curiam) (quoting Sheldon v. Emergency Med. Consultants, I, P.A., 43 S.W.3d 701, 702 (Tex. App.—Fort Worth 2001, no pet.)). A plaintiff misnaming itself generally is a misnomer. See Chen v. Breckenridge Estates Homeowners Ass'n, Inc., 227 S.W.3d 419, 421 (Tex. App.—Dallas 2007, no pet.); Pierson v. SMS Fin. II, L.L.C., 959 S.W.2d 343, 347-48 (Tex. App.—Texarkana 1998, no pet.).
Cybiz denies that the statement in Victory's pleading is a misnomer, and in support of that position, Cybiz relies on Barrera v. Cherer, No. 04-13-00612-CV, 2014 WL 1713522, at *1-2 (Tex. App.—San Antonio Apr. 30, 2014, no pet.) (mem. op.). In Barrera, Cherer brought a forcible-detainer suit to obtain possession of a property owned by Chererco LLC, the limited liability company of which he was a member. Id. at *1. The Barreras, who occupied the property, appealed on the ground that Cherer lacked standing to bring claims belonging to the company. In holding that this was an issue of standing rather than misnomer, the court distinguished Reddy Partnership and Greater Houston Orthopaedic Specialists because "[i]n both of those cases, the correct parties to the suit were involved in the litigation at the time the issue of misnomer arose." Id. at *1. But see In re Greater Houston Orthopaedic Specialists, Inc., 295 S.W.3d at 325 (citing Pierson with approval and with the parenthetical, "determining that misnomer occurred when actual plaintiff, SMS II, instead named another entity, SMS I, in its original petition" (emphasis added)).
We need not determine whether we would reach the same result as the Barrera court if presented with similar facts, because the facts in this case mirror those of In re Greater Houston Orthopaedic Specialists. In that case, Greater Houston Orthopaedic Specialists ("GHOS") sued two defendants but then filed a notice of nonsuit in which it used the correct cause number and style but identified itself as "Orthopaedic Specialists, L.L.P." See id. at 324. The notice was signed by GHOS's counsel as "attorney for plaintiff." Id. After the defendants filed counterclaims, the trial court set aside its order dismissing the case and set the case for trial. According to the defendants, the notice of nonsuit was ineffective because it was not filed by the plaintiff, but by a non-existent entity. Id. at 325. The Texas Supreme Court, however, held that this was mere misnomer because the plaintiff had misnamed itself rather than a defendant, and "[a]t this stage in the litigation, there is no risk that [the defendants] would not know that GHOS, the sole plaintiff, and the entity named in the caption of the notice of nonsuit, was the entity that had filed the nonsuit."
The similarity of the facts in this case dictate a similar result. As with the notice of nonsuit in Greater Houston Orthopaedic Specialists, Victory's counterclaim bears the correct case style and cause number. As in that case, the document is signed by the attorney for the correct party, that is, as "Attorney for Defendant, Susan C. Gaskill MD PA d/b/a Victory Breast Diagnostics & Women's Imaging." Moreover, the counterclaim is styled as a counterclaim, and "the word 'counterclaim' most frequently denotes a defendant's claim against a plaintiff for affirmative relief." Doyer v. Pitney Bowes, Inc., 80 S.W.3d 215, 218 (Tex. App.—Austin 2002, pet. denied). The only defendant in the case is Susan C. Gaskill MD, PA d/b/a Victory Breast Diagnostics & Women's Imaging. Finally, unlike in Barrera, judgment in this case was rendered in favor of the entity that actually owned the claim.
We overrule this issue.
IV. Unpreserved Complaints
Cybiz presents four more issues for review, but the record fails to show that any of them were preserved for review.
A. Open-Account Claim
To maintain a suit on an open account for which a systematic record has been kept, the plaintiff's claim must be supported by an affidavit "to the effect that such claim is, within the knowledge of affiant, just and true, that it is due, and that all just and lawful offsets, payments and credits have been allowed." TEX. R. CIV. P. 185. A petition supported by this material is "taken as prima facie evidence thereof, unless the party resisting such claim shall file a written denial, under oath." Id.; see also Pascual Madrigal P.L.L.C. v. Commercial IT Solutions Inc., No. 04-13-00742-CV, 2014 WL 4230174, at *2 n.1 (Tex. App.—San Antonio Aug. 27, 2014, no pet.) (mem. op.) (explaining that Rule 185 is an exception to the general rule that pleadings are not evidence).
To overcome this evidentiary presumption, the defendant must file a verified answer denying the account. See TEX. R. CIV. P. 185; TEX. R. CIV. P. 93(10); Rizk v. Fin. Guardian Ins. Agency, Inc., 584 S.W.2d 860, 862 (Tex. 1979) ("It is settled, however, 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."). A defendant who fails to answer with a sworn denial waives the right to dispute the receipt of the goods or services or to contest the accuracy of the stated charges. See TEX. R. CIV. P. 185 ("[I]f he does not timely file a written denial, under oath, he shall not be permitted to deny the claim, or any item therein, as the case may be."); Rizk, 584 S.W.2d at 862.
Victory's answer was verified by Gaskill "who stated, upon oath, that the statements made in the foregoing instrument are true and correct to the best of her knowledge as President of [Victory]." Gaskill's verification discloses neither the lack nor the extent of her personal knowledge of the facts to which she attests.
Without addressing error preservation, Cybiz contends that Gaskill's affidavit is defective as a matter of law because, as stated by the Thirteenth Court of Appeals, an affidavit that "does not positively and unqualifiedly represent the facts as disclosed in the affidavit to be true and within the affiant's personal knowledge is legally invalid." Day Cruises Mar., L.L.C v. Christus Spohn Health Sys., 267 S.W.3d 42, 54-55 (Tex. App.—Corpus Christi 2008, pet. denied). But see Bauer v. Jasso, 946 S.W.2d 552, 557 (Tex. App.—Corpus Christi 1997, no writ) (holding that the failure to state that the affidavit is based on the affiant's personal knowledge is a defect in form, which is waived unless the complaining party objects and obtains a ruling on the objection). Cybiz also cites our decision in Gayne v. Dual-Air, Inc., 600 S.W.2d 373, 374, 375 (Tex. Civ. App.—Houston [14th Dist.] 1980, no writ), but as we pointed out in our opinion, the appellant in that case objected in the trial court that the affidavit was defective.
Under this court's precedent, a complaint that an affidavit fails to show the affiant's personal knowledge of the facts must be preserved in the trial court. See Wash.DC Party Shuttle, LLC v. IGuide Tours, 406 S.W.3d 723, 736 (Tex. App.—Houston [14th Dist.] 2013, pet. denied) (en banc). In IGuide, the appellee's special appearance was supported by the affidavit of a person who was both its current employee and the one of the appellants' former employees. See id. at 727. The appellant objected in the trial court and on appeal that the affidavit did not show that the affiant had personal knowledge of the facts to which she attested. See id. at 731. After considering the decisions of the Texas Supreme Court and of the intermediate courts of appeals, the principle of stare decisis, and the rationale for the error-preservation rules, we concluded that the affidavit's failure to show the affiant's personal knowledge of the facts constituted a defect of form. See id. at 736. The appellants therefore were required to preserve their complaint to the defective affidavit by raising their objection in the trial court and by either obtaining a ruling on their objection or excepting to the trial court's refusal to rule. See id. Because the appellants raised their objection in the trial court but did not pursue it to an adverse ruling, we concluded that they failed to preserve their complaint for review. See id.
The record before us fails to show that Cybiz objected in the trial court to Gaskill's affidavit verifying her answer denying Cybiz's open-account claim. Because the record does not show that Cybiz preserved its complaint for review, we overrule this issue.
B. Limitations
Cybiz also asserts that the pleadings conclusively prove that Victory's counterclaims are barred by limitations. Because limitations is an affirmative defense, the party relying on limitations bears the burden to plead, prove, and secure findings on the issue. See Woods v. William M. Mercer, Inc., 769 S.W.2d 545, 517 (Tex. 1988). The record shows that in its answer to Victory's counterclaims, Cybiz raised the defense of limitations; however, the record does not show that Cybiz requested or obtained findings that any of Victory's claims were time-barred. We therefore overrule this issue.
C. The One-Satisfaction Rule
According to Cybiz, the trial court violated the one-satisfaction rule by awarding Victory damages for both its fraud and its breach-of contract claims. This complaint must be preserved in the trial court. See Patel v. Hussain, 485 S.W.3d 153, 174-76 (Tex. App.—Houston [14th Dist.] 2016, no pet.) (concluding that appellant failed to preserve the complaint that awarding damages assessed by the jury on multiple causes of action violates the one-satisfaction rule); Lake v. Premier Transp., 246 S.W.3d 167, 174 (Tex. App.—Tyler 2007, no pet.) (same). Moreover, Cybiz was required to raise its complaint in a timely fashion and obtain a ruling on it by the trial court. See TEX. R. APP. P. 33.1(a).
Although Cybiz raised this complaint in its "Response to Defendant's Proposed Final Judgment," the record shows that the document was filed nearly three months after the trial court rendered judgment, and well after the trial court lost plenary power to rule on it. See TEX. R. CIV. P. 329b(d). Because Cybiz's complaint has not been preserved, we overrule this issue.
D. Post-Judgment Interest Rate
In its final issue, Cybiz argues that the trial court erred in setting a 6% post-judgment interest rate because the maximum legal rate of interest was 5%. Once again, Cybiz was required to raise this issue in the trial court. See Watts v. Oliver, 396 S.W.3d 124, 134 (Tex. App.—Houston [14th Dist.] 2013, no pet.) (holding that appellant failed to preserve the complaint that the 6% post-judgment interest rate exceeded the maximum allowed by law). Because the record does not show that this complaint was preserved, we overrule this issue as well.
V. Conclusion
We conclude that Victory had standing to maintain the counterclaims on which the trial court rendered judgment in its favor, but the record fails to show that Cybiz preserved its remaining complaints for review. We therefore affirm the trial court's judgment.
/s/ Tracy Christopher
Justice Panel consists of Justices Christopher, Jamison, and Donovan.