Opinion
No. 14-08-00081-CV
Memorandum Opinion filed August 4, 2009.
On Appeal from the County Civil Court at Law No. 3, Harris County, Texas, Trial Court Cause No. 851439.
Panel consists of Justices SEYMORE, BROWN, and SULLIVAN.
MEMORANDUM OPINION
In this case involving storage of, and refusal to return, three aircraft, appellant, Danny Langhorne, challenges the trial court's (1) findings in favor of appellee, Kay M. Miller, on her claim of conversion, (2) award of conversion damages to Miller, and (3) take-nothing judgment against Langhorne on his claim for quantum meruit. We modify the judgment to order that Miller recover nothing on her claim for conversion of one of the aircraft, modify the total award of damages and prejudgment interest accordingly, and affirm the judgment as modified.
Because all dispositive issues of law are settled, we issue this memorandum opinion. See Tex. R. App. P. 47.4.
I. FACTUAL AND PROCEDURAL BACKGROUND
In 1996, Miller was involved in a hostile divorce from Bufort Peters. Langhorne had known Peters for ten to fifteen years, and Peters was one of Langhorne's closest friends. According to Langhorne, Peters brought Langhorne three aircraft in the summer of 1996. The aircraft were "basket cases," meaning the planes were missing parts and were not flyable. Langhorne and Peters orally agreed Langhorne would store the planes, and "[i]n lieu of money, [Peters] would do annuals on [Langhorne's] aircraft." Peters died in November 1996, before the Miller-Peters divorce could become final. In December 1996, Langhorne appeared in probate court as a witness to the signing of Peters's will.
In June 2001, the probate court rendered an agreed final judgment between Miller and the independent administrator of Peters's estate. Under the judgment, Miller was awarded title to four aircraft, including a Taylorcraft (L-2) DCO-65, a Fairchild 24R-46, and a Piper J3-C-65 Cub, all originally manufactured between 1944 and 1946. The court also ordered that each party would assume and pay any debt owed on the aircraft awarded it, and the parties represented the only indebtedness on the planes awarded to Miller was a Northwest Bank lien on the Piper.
Someone had told Miller that Langhorne might have the Taylorcraft, Fairchild, and Piper so; in June or July 2001, Miller went to Langhorne's hangar to claim the three planes. According to Langhorne, he told Miller she would have to pay to get the planes. According to Miller, Langhorne was rude, denied he had the planes, and said nothing about a fee. Langhorne admitted he had participated in filing criminal trespass charges against Miller.
Langhorne also claimed that, starting in September 1996, he sent monthly invoices to Miller at a Hockley Post Office address. He did not have copies of the invoices, the last one of which he purportedly sent sometime in 2000.
In June 2005, Miller received a letter from Langhorne's attorney demanding payment. According to Miller, that was the first time she knew where the planes were. In November 2005, Langhorne sued Miller for breach of contract. He subsequently amended his petition to include a claim for quantum meruit. Miller counterclaimed for conversion.
Trial was to the court. Langhorne abandoned his breach-of-contract claim and proceeded only on his claim for quantum meruit.
The trial court rendered judgment that Langhorne take nothing on his quantum meruit claim. The court found in favor of Miller on her conversion claim and awarded her $3,000 for conversion of the Piper, $8,000 for conversion of the Fairchild, and $30,000 for conversion of the Taylorcraft, plus pre-judgment interest of $11,603.56 and post-judgment interest at the rate of 8.25 percent from the date of judgment until paid. Langhorne filed a motion for new trial, and the trial court filed findings of fact and conclusions of law. Langhorne's motion for new trial was overruled by operation of law.
II. STANDARD OF REVIEW
In three issues, Langhorne argues the evidence was legally insufficient to support the trial court's findings (1) in favor of Miller on her conversion claim, (2) on the amount of conversion damages, and (3) against Langhorne on his quantum meruit claim. He requests this court to render judgment that Miller take nothing and that he recover unpaid storage fees and attorney's fees.
Langhorne briefly sets forth the standard of review for factual sufficiency, but he frames his arguments as no evidence or legal insufficiency points and requests only rendition, rather than remand. See Horrocks v. Tex. Dept. of Transp., 852 S.W.2d 498, 499 (Tex. 1993) (per curiam) ("Ordinarily, an appellate court should render judgment after sustaining a complaint as to the legal sufficiency of the evidence."). Accordingly, we interpret Langhorne as arguing the evidence was legally insufficient, rather than legally and factually insufficient.
In reviewing a trial court's findings for legal sufficiency of the evidence, we apply the same standards we apply in reviewing evidence supporting a jury's answer. Catalina v. Blasdel, 881 S.W.2d 295, 297 (Tex. 1994). Findings of fact in a bench trial have the same force and dignity as a jury's verdict on jury questions. Arrellano v. State Farm Fire Cas. Co., 191 S.W.3d 852, 855-56 (Tex.App.-Houston [14th Dist.] 2006, no pet.). However, the trial court's findings are not conclusive when, as here, there is a complete reporter's record. Id. at 856.
When reviewing legal sufficiency of the evidence, we review the evidence in the light most favorable to the challenged finding and indulge every reasonable inference that would support it. City of Keller v. Wilson, 168 S.W.3d 802, 822 (Tex. 2005). We credit favorable evidence if a reasonable fact finder could, and we disregard contrary evidence unless a reasonable fact finder could not. Id. at 827. The evidence is legally sufficient if it would enable fair-minded people to reach the finding under review. Id.
We will sustain a no-evidence point only when (1) the record discloses a complete absence of evidence of a vital fact, (2) the court is barred by rules of law or of evidence from giving weight to the only evidence offered to prove a vital fact, (3) the evidence offered to prove a vital fact is no more than a mere scintilla, or (4) the evidence establishes conclusively the opposite of the vital fact. See Marathon Corp. v. Pitzner, 106 S.W.3d 724, 727 (Tex. 2003). An appellant attacking the legal sufficiency of evidence supporting an adverse finding on which he had the burden of proof must show on appeal that a contrary finding was established as a matter of law. See Croucher v. Croucher, 660 S.W.2d 55, 58 (Tex. 1983).
III. DISCUSSION
A. Issue One: Finding in Favor of Miller on Conversion
In issue one, Langhorne argues the trial court erred in awarding any conversion damages to Miller. To establish her claim for conversion, Miller had to prove (1) she owned, had legal possession of, or was entitled to, possession of the aircraft, (2) Langhorne assumed and exercised dominion and control over the aircraft in an unlawful and unauthorized manner, to the exclusion of and inconsistent with Miller's rights, and (3) Langhorne refused Miller's demand for return of the aircraft. See Hunt v. Baldwin, 68 S.W.3d 117, 131 (Tex.App.-Houston [14th Dist.] 2001, no pet.).
Langhorne argues there is no evidence of the second element because he had a valid aircraft repair and maintenance lien under Texas Property Code sections 70.301 and 70.302. Section 70.301 provides:
(a) A person who stores, fuels, repairs, or performs maintenance work on an aircraft has a lien on the aircraft for:
(1) the amount due under a contract for the storage, fuel, repairs, or maintenance work; or
(2) if no amount is specified by contract, the reasonable and usual compensation for the storage, fuel, repairs, or maintenance work.
(b) This subchapter applies to a contract for storage only if it is:
(1) written; or
(2) oral and provides for a storage period of at least 30 days.
Tex. Prop. Code Ann. § 70.301 (Vernon 2007).
Citation is to the current statutes. During the pendency of the events underlying this case, the legislature amended sections 70.301 and 70.302 by adding provisions not relevant to the disposition of this case. See Act of May 25, 2001, 77th Leg., R.S., ch. 1171 § 1, 2001 Tex. Gen. Laws 2637, 2637 (amending section 70.301); Act of May 17, 1999, 76 Leg., R.S., ch. 414, §§ 2.41, 3.01, 1999 Tex. Gen. Laws 2639, 2746, 2747 (amending section 70.302, effective July 1, 2001).
Section 70.302 further provides:
(a) A holder of a lien under this subchapter may retain possession of the aircraft subject to the lien until the amount due is paid.
(b) Except as provided by Subsection (c), if the holder of a lien under this subchapter relinquishes possession of the aircraft before the amount due is paid, the person may retake possession of the aircraft as provided by Section 9.609, Business Commerce Code.
(c) The holder of a lien under this subchapter may not retake possession of the aircraft from a bona fide purchaser for value who purchases the aircraft without knowledge of the lien before the date the lien is recorded under Section 70.303.
Id. § 70.302.
To bring his situation under the provisions of sections 70.301 and 70.302, Langhorne relies on an oral agreement with Peters, made five to six months before Peters's death, to store Peters's aircraft. There was evidence, however, showing (1) Langhorne's oral agreement with Peters was storage in exchange, not for a fee, but for Peters's performing "annuals" on Langhorne's aircraft, (2) Langhorne, despite appearing at the probate proceedings, never filed a claim against Peters's estate, (3) the parties to the agreed final judgment in the probate proceedings represented that the only indebtedness on the aircraft was a Northwest Bank lien, (4) Langhorne had no agreement with Miller to store the aircraft, (5) Langhorne made no attempt to collect the purported fees between sometime in 2000 and June 2005, (6) Miller received no invoices from Langhorne, and (7) if Langhorne did send invoices, he sent them to an address other than the one shown on the planes' FAA registrations.
There was also Miller's testimony that, in June or July 2001, shortly after entry of the agreed final judgment, Langhorne denied having the aircraft. If Langhorne had relinquished possession of the aircraft during that period of time, and therefore was telling Miller the truth, he would have had to have regained possession under the procedure set forth in Property Code section 70.302(b) and the Business Commerce Code to be lawfully in possession of the aircraft. See Tex. Prop. Code Ann. § 70.302(b). If, however, Langhorne in fact had possession of the aircraft when he spoke with Miller, then Langhorne lied to Miller. Either interpretation, along with the other evidence set forth above, supports a finding that Langhorne assumed and exercised dominion and control over the aircraft in an unlawful and unauthorized manner to the exclusion of, and inconsistent with, Miller's rights. See Hunt, 68 S.W.3d at 131.
The trial court found Langhorne "denied directly to Kay Miller that he had possession of the planes . . . on a date no later than July 21, 2001. . . ." Langhorne does not dispute this finding.
The evidence was legally sufficient to support the trial court's finding in favor of Miller on her conversion claim. Accordingly, we overrule Langhorne's first issue.
B. Issue Two: Findings on Conversion Damages
In issue two, Langhorne argues the conversion damages should be reduced to zero because there is no evidence to support the trial court's findings of $3,000 for conversion of Piper, $8,000 for conversion of the Fairchild, and $30,000 for conversion of the Taylorcraft. Langhorne contends the damages evidence was incompetent, speculative, and not based on fair market value. Miller relies on her own testimony and on documentary evidence introduced by Langhorne.
A plaintiff must prove damages before a court may allow recovery for conversion. United Mobile Networks, L.P. v. Deaton, 939 S.W.2d 146, 147 (Tex. 1997). The usual measure of damages for conversion is the fair market value of the property at the time and place of conversion. See id. at 147-48. When converted property has no readily ascertainable fair market value, however, the measure of damages is the actual value of the property to the owner at the time of its loss. Burns v. Rochon, 190 S.W.3d 263, 270 (Tex.App.-Houston 2006, no pet.) (citing Crisp v. Sec. Nat'l Ins. Co., 369 S.W.2d 326 (Tex. 1963)). Damages are limited to the amount necessary to compensate the plaintiff for the actual losses or injuries sustained as a natural and proximate result of the defendant's conversion. Deaton, 939 S.W.2d at 148. A conversion should not unjustly enrich the wrongdoer or the complaining party. Id.
"Fair market value" is the price the property would bring when offered for sale by one who desires, but is not obliged to sell, and bought by one who is under no necessity of buying it. City of Austin v. Cannizzo, 153 Tex. 324, 267 S.W.2d 808, 815 (1954). "Actual value" applies to goods possessed for the owner's comfort and well-being, rather than for resale. See Crisp v. Sec. Nat'l Ins. Co., 369 S.W.2d 326, 329 (Tex. 1963). "The measure of damages that should be applied for loss of this kind of property is actual value of the articles to the owner in the condition they were in at the time of the loss, without resort to market value, and excluding any fanciful or sentimental considerations." Wright v. Gernandt, 559 S.W.2d 864, 870 (Tex.Civ.App.-Corpus Christi 1977, no writ) (citing Crisp, 369 S.W.2d at 328-29)).
In sum, no absolutely rigid rule applies to every state of facts in conversion cases. Minter v. Sparks, 246 S.W.2d 954, 957 (Tex.Civ.App.-Dallas 1951, writ ref'd n.r.e.). Instead, the appropriate result is compensation for the injury. Id.
"No matter what measure of damages is employed in establishing the value of the converted property, 'it is well settled that the owner of property can testify as to his opinion regarding the value of his own property . . . even if the owner's testimony is halting and indefinite it nonetheless will be sufficient to sustain a verdict when there is no controverting evidence.'" Burns, 190 S.W.3d at 270-71 (quoting Espinosa v. Schomberg, 601 S.W.2d 161, 164 (Tex.Civ.App.-Waco 1980, writ ref'd n.r.e.)).
In the present case, Miller testified that, in 1996, she and Peters had their business and home in an airplane hangar. The airplanes in question had been at Miller's hangar/residence. Both Miller and Peters were involved in the restoration of aircraft. At one point, Peters was working at NASA, and Miller was doing all of the restoring at the hangar. Miller testified that, as an owner and operator of the three airplanes, she was familiar with their history. Miller opined the Piper was worth $30,000; the Fairchild, around $20,000; and the Taylorcraft, $30,000 to $35,000.
Miller nevertheless admitted she had no knowledge of the condition of the planes when they arrived at Langhorne's hangar in 1996. Thus, even though it is the testimony of an owner, Miller's testimony by itself is no evidence of the condition or value of the planes at the time of conversion, i.e., when Langhorne subsequently refused to return them in 2001. See Varel Mfg. Co. v. Acetylene Oxygen Co., 990 S.W.2d 486, 499 (Tex.App.-Corpus Christi 1999, no pet.) (holding appellant prevailed on no evidence point when appellee's witness's testimony showed value he placed on converted property at time of trial was higher than its value in 1995, when conversion occurred, and accordingly there was no evidence of market value at time of conversion).
Langhorne, however, introduced into evidence a document Miller signed close to the time Peters took the planes to Langhorne. In that document, Miller and Peters valued the Piper at $3,000 and the Fairchild at $8,000.
Miller testified she signed the document while she and Peters were separated and in the process of divorcing. The valuations would therefore have been generated close to the time Peters took the planes to Langhorne's hangar.
The document was admitted into evidence as Plaintiff's Exhibit 10, but it is not part of the record on appeal. We therefore cannot consider the document itself even though Miller has included it in the appendix to her brief. See Cherqui v. Westheimer St. Festival Corp., 116 S.W.3d 337, 342 n. 2 (Tex.App.-Houston 2003, no pet.) ("[W]e cannot consider documents attached as appendices to briefs and must consider a case based upon the record filed."). Accordingly, we have relied only on testimony about the document.
Langhorne also testified he was not aware of any decay or vandalism, and was aware of only a little deterioration due to the passage of time. Thus, it is reasonable to infer that, when Miller was denied possession of the Piper and the Fairchild in June or July of 2001, the aircraft would have had the same values as they had when Peters took them to Langhorne's hangar in 1996, those values being $3,000 and $8,000, respectively, as evidenced by the contemporaneous document. Langhorne's own evidence therefore supports the trial court's findings of damages of $3,000 and $8,000, respectively, for conversion of the Piper and the Fairchild.
In contrast, the only evidence supporting a value of $30,000 for the Taylorcraft is Miller's testimony. As discussed above, Miller had no knowledge of the Taylorcraft's condition when it arrived at Langhorne's hangar and her testimony therefore does not support an inference of its subsequent value at the time of conversion.
Miller asks this court to consider her verified pleadings as evidence. We decline to do so. See Love v. State Bar of Tex., 982 S.W.2d 939, 943 (Tex.App.-Houston 1998, no pet.) ("Pleadings, even those that are verified, are not evidence of the truth of their allegations.").
Miller testified she was flying "the L-4" shortly before Peters took the planes to Langhorne. From the descriptions in the agreed final judgment in the divorce, however, the L-4 would be the Piper, and not the Taylorcraft.
For the foregoing reasons, we overrule Langhorne's second issue as it relates to the award of damages for the Fairchild and the Piper, but sustain his second issue as it relates to the award of damages for the Taylorcraft. We therefore modify the judgment to order that Miller recover nothing in damages for conversion of the Taylorcraft, and we adjust the damages and prejudgment interest accordingly.
C. Issue Three: Quantum Meruit
In issue three, Langhorne argues the trial court "erred in its decision that [Langhorne] take nothing against [Miller] on his claim of quantum meruit asserted against [Miller]." To prove quantum meruit against Miller, Langhorne had to show (1) he rendered valuable services or furnished materials; (2) for Miller; (3) which services and materials Miller accepted, used, and enjoyed; (4) under such circumstances as reasonably notified Miller that Langhorne, in performing such services, was expecting Miller to pay him. See Wohlfahrt v. Holloway, 172 S.W.3d 630, 634 (Tex.App.-Houston 2005, pet. denied).
Langhorne's claim fails for several reasons. First, Langhorne's oral agreement was with Peters, not Miller. Second, the existence of Langhorne's express contract with Peters for the same services for which he now seeks reimbursement from Miller defeats his claim against Miller for quantum meruit. See Econ. Forms Corp. v. Williams Bros. Constr. Co., 754 S.W.2d 451, 458 (Tex.App.-Houston 1988, no writ). Third, the trial court found that, no later than July 31, 2001, a date shortly after the probate court awarded Miller the aircraft, Langhorne denied having them. Finally, the trial court found Miller did not know Langhorne had possession of her planes or expected compensation for their storage until on or after June 13, 2005, i.e., when Langhorne's attorney sent the demand letter.
It is undisputed Langhorne did not file a claim against Peters's estate. There is also no indication he sued the independent administrator of the estate.
Langhorne does not argue Miller was a third party beneficiary to his contract with Peters.
The evidence was legally insufficient to establish Langhorne's quantum meruit claim against Miller. The trial court correctly rendered a take-nothing judgment against him. Accordingly, we overrule Langhorne's third issue.
IV. CONCLUSION
Having sustained Langhorne's second issue as it relates to damages awarded to Miller for conversion of the Taylorcraft airplane, we modify the judgment to order that Miller recover nothing on her claim for conversion of the Taylorcraft, reduce the total amount of damages to $11,000, and reduce the award of prejudgment interest to $3,113.15. Having found no error in the remainder of the judgment and having overruled Langhorne's remaining issues, we affirm the judgment as modified.