Opinion
No. 14-07-00751-CV
Opinion filed June 24, 2008.
On Appeal from the 190th District Court Harris County, Texas, Trial Court Cause No. 2005-36593-A.
MEMORANDUM OPINION
Gerald W. Maness appeals from orders granting summary judgment in favor of Spaw Maxwell Group, LLC ("Spaw") on Maness' claims for negligence, negligent misrepresentation, fraud, and breach of contract. Maness contends that the trial court erred because fact issues exist regarding whether (1) Maness was a third party beneficiary of a contract between Spaw and PM Realty Group Investment Services, LLC ("PM Realty"); (2) Spaw breached its contract with PM Realty to Maness' detriment; and (3) Spaw made negligent representations and committed fraud against Maness. We affirm.
Background
Gerald W. Maness, a family physician, leased office space from CSFB 1998-P1 Avex Ltd. Partnership ("Avex"). Avex contracted with PM Realty to manage the office complex. In June 2001, the office flooded during tropical storm Allison.
PM Realty contracted with Spaw to refurbish and restore Maness' office space after the flood. PM Realty arranged for Maness' property to be moved and stored during restorations.
Maness claims to have sustained losses in connection with the storage of his property and the restoration of his office space. Maness sued for damages in connection with those losses, asserting claims against Avex, PM Realty, and the storage company. Spaw moved for summary judgment on all of Maness' claims and requested a severance.
On June 7, 2007, the trial court signed an order granting the first of three summary judgments against Maness. This order disposed of Maness' claims for breach of contract, negligence, negligent misrepresentation, and fraud. On August 10, 2007, the trial court signed two additional orders granting summary judgment on Maness' claims for contribution and indemnity.
On August 10, 2007, the trial court signed an order granting Spaw's motion for severance. With this severance, all claims against Spaw became final and appealable.
On September 10, 2007, Maness filed a notice of appeal challenging the summary judgment orders signed on June 7, 2007 and August 10, 2007. Standard of Review
On appeal, Maness does not challenge the August 10, 2007 order granting summary judgment on his claims for indemnity and contribution. Therefore, we do not address these claims. See Tex. R. App. P. 38.01(e); see also Carter v. MacFadyen, 93 S.W.3d 307, 313 n. 7 (Tex.App.-Houston [14th Dist.] 2002 pet. denied) (court did not address orders not specifically challenged on appeal).
This court applies de novo review to a summary judgment order using the same summary judgment standard employed in the first instance by the trial court. Valence Operating Co. v. Dorsett, 164 S.W.3d 656, 661 (Tex. 2005). Spaw requested both a traditional summary judgment under Texas Rule of Civil Procedure 166a(c) and a no-evidence summary judgment under Rule 166a(i).
A traditional summary judgment may be granted if the motion and summary judgment evidence establish there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law. Tex. R. Civ. P. 166a(c). Summary judgment for a defendant is proper when the defendant negates at least one element of each of the plaintiff's theories of recovery, or pleads and conclusively establishes each element of an affirmative defense. Sci. Spectrum, Inc. v. Martinez, 940 S.W.2d 910, 911 (Tex. 1997).
In reviewing a traditional summary judgment, we take as true all evidence favorable to the non-movant; indulge every reasonable inference in the non-movant's favor; and resolve any doubts in the non-movant's favor. Sudan v. Sudan, 199 S.W.3d 291, 292 (Tex. 2006).
A no-evidence motion for summary judgment must be granted if (1) the moving party asserts that there is no evidence of one or more specified elements of a claim or defense on which the adverse party would have the burden of proof at trial; and (2) the respondent produces no summary judgment evidence raising a genuine issue of material fact on those elements. See Tex. R. Civ. P. 166a(i). In reviewing a no-evidence motion for summary judgment, we view all of the summary judgment evidence in the light most favorable to the non-movant, "crediting evidence favorable to that party if reasonable jurors could, and disregarding contrary evidence unless reasonable jurors could not." Mack Trucks, Inc. v. Tamez, 206 S.W.3d 572, 582 (Tex. 2006). The non-moving party need not marshal its proof, but it must present evidence that raises a genuine fact issue on the challenged elements. Sw. Elec. Power Co. v. Grant, 73 S.W.3d 211, 215 (Tex. 2002).
Analysis
In its summary judgment motion, Spaw contended that (1) Maness' claims for negligence and negligent misrepresentation are barred by the statute of limitations; (2) Maness had no evidence of a valid, enforceable contract between itself and Maness; (3) Maness was not a third party beneficiary of the contract between Spaw and PM Realty; (3) there was no evidence of a breach of contract; (4) there was no evidence Spaw was negligent in completing work pursuant to the agreement; and (5) there was no evidence of a fraudulent or negligent misrepresentation by Spaw.
Maness contends on appeal that the trial court erred in granting summary judgment to Spaw because a fact issue exists as to whether (1) Maness was the third party beneficiary of the contract between Spaw and PM Realty; (2) Spaw breached its contract with PM Realty to Maness' detriment; and (3) Spaw made negligent representations and committed fraud against Maness.
When, as here, the trial court does not state the grounds for granting a summary judgment, we affirm the summary judgment if any theory advanced in the motion supports the granting of a summary judgment. See Dow Chem. Co. v. Francis, 46 S.W.3d 237, 242 (Tex. 2001).
On appeal, Maness does not address Spaw's contentions that Maness' claims for negligence, including negligent misrepresentation, are barred by the two-year statute of limitations. Tex. Civ. Prac. Rem. Code § 16.003 (Vernon Supp. 2007); see Envtl. Procedures, Inc. v. Guidry, No. 14-05-01090-CV, 2008 WL 1746087, at *9 (Tex.App.-Houston [14th Dist.] April 17, 2008, no pet.) (two-year statute of limitations applies to negligence and negligent misrepresentation claims). Because Maness has not challenged these summary judgment grounds on appeal, we affirm the grant of summary judgment as to negligence and negligent misrepresentation. State Farm Fire Cas. Co. v. S.S., 858 S.W.2d 374, 381 (Tex. 1993) (appellant must negate all grounds when there are multiple grounds and order does not specify which one the trial court relied upon); Beatty v. Holmes, 233 S.W.3d 475, 485 (Tex.App.-Houston [14th Dist.] 2007, pet. filed) ("If the appellant fails to negate each ground upon which the judgment may have been granted, the appellate court must uphold the summary judgment"). We address below the remaining claims concerning third party beneficiary status, breach of contract, and fraud.
Third Party Beneficiary and Breach of Contract
Maness does not dispute Spaw's assertion that no contract exists between Maness and Spaw. Instead, Maness claims that (1) he is the third party beneficiary of the contract between Spaw and PM Realty; and (2) Spaw breached the contract with PM Realty to Maness' detriment. Spaw counters that Maness cannot be a third party beneficiary as a matter of law because the contract between Spaw and PM Realty does not reference Maness, and there is no evidence of an intention to bestow third party beneficiary status on Maness.
There is a strong presumption against third party beneficiary status, and such status will not be created by implication. See MCI Telecomm. Corp. v. Tex. Util. Elec. Co., 995 S.W.2d 647, 650-52 (Tex. 1999) (there must be contractual language indicating two parties entered into a contract directly and primarily for the third party's benefit; when a contract is not ambiguous, the construction of the written instrument is a question of law); see also Union Pac. R.R. Co. v. Novus Int'l., Inc., 113 S.W.3d 418, 422-23 (Tex.App.-Houston [1st Dist.] 2003, pet. denied). "In determining intent, courts presume that the parties contracted only for themselves and not for the benefit of third parties, unless the obligation to the third party is clearly and fully spelled out." Corpus Christi Bank Trust v. Smith, 525 S.W.2d 501, 503 (Tex. 1975).
As a threshold matter, the parties disagree about exactly which document constitutes "the contract" giving rise to Maness' claimed status as a third party beneficiary.
Maness contends the operative contract is a document entitled "Standard Form of Agreement Between Owner and Contractor where the basis of payment is the COST OF THE WORK PLUS A FEE with a negotiated Guaranteed Maximum Price." Spaw challenges the effectiveness of this document because it is signed only by Spaw. Spaw says the operative contract is a June 14, 2001 letter to Sondra Satterwhite of PM Realty from Tom Forney of Spaw. The letter names only PM Realty and Spaw as parties, and it is signed by representatives of both entities.
We need not choose between these documents to determine which is the operative contract because neither document contains language bestowing third party beneficiary status on Maness. The intent to create third party beneficiary status must be fully and clearly set out. See MCI Telecomm. Corp., 995 S.W.2d at 651-52. Absent direct language in the contract indicating a party is a third party beneficiary, this status is difficult to establish. See Union Pac. R.R. Co., 113 S.W.3d at 422-23; Esquivel v. Murray Guard, Inc., 992 S.W.2d 536, 544 (Tex.App.-Houston [14th Dist.] 1999, pet. denied) ("we look only to the four corners of the agreement to determine the parties' intent"); see also Raymond v. Rahme, 78 S.W.3d 552, 561 (Tex.App.-Austin 2002, no pet.) (doubts must be resolved against a finding of third party beneficiary status); Brunswick Corp. v. Bush, 829 S.W.2d 352, 354 (Tex.App.-Fort Worth 1992, no writ) ("The party claiming third party beneficiary status will succeed or fail according to the terms of the contract"). Both the Standard Form of Agreement and the June 14, 2001 letter lack language demonstrating an intent to treat Maness as a third party beneficiary.
Third party beneficiary statues will not be recognized unless (1) the obligation of the bargain-giver is fully spelled out, (2) it is unmistakable that a benefit to the third party was within the contemplation of the primary contracting parties, and (3) the primary parties contemplated that the third party would be vested with the right to sue for enforcement of the contract. See Union Pac. R.R. Co., 113 S.W.3d at 422.
Maness asserts that "the facts clearly establish that Plaintiff was an intended beneficiary of the agreement between PM Realty on behalf of Avex and Spaw Maxwell Company." Maness' contention derives from the legal duty he assigns to Avex in favor of its tenants to repair the leased space after the flood; the duty he says PM Realty owes Avex as its representative managing the property; and the contract between Spaw and PM Realty to perform post-flood renovations. Maness argues that he is a creditor beneficiary of the contract entitled to enforce his contract claims against Spaw as a third party beneficiary.
Maness argues, in the alternative, that the contract can be enforced as a donee third party beneficiary. For the same reasons that there is no intention by the parties to confer third party beneficiary status on Maness under the doctrine of creditor third party beneficiary, we also conclude Maness is not a donee third party beneficiary. "A donee beneficiary is a party to whom the performance promised, when rendered, will come to her as a pure donation; a creditor beneficiary is one to whom the performance promised will come in satisfaction of a legal duty owed to her by the promisee." MCI Telecomm. Corp. 995 S.W.2d at 651; see also Rivera v. S. Green Ltd. Partnership, 208 S.W.3d 12, 23 (Tex.App.-Houston [14th Dist.] 2006, pet. denied) (both donee or creditor third party beneficiaries must show they are more than incidental beneficiaries).
Maness relies on his own affidavit, which references certain attachments; Spaw objected to these attachments as not being properly authenticated. Even if we consider these attachments, however, they do not overcome the strong presumption against third party beneficiary status. At most, the attachments and Maness' self-serving statements in his affidavit demonstrate that Spaw repaired a building managed by PM Realty, and that Maness was an incidental beneficiary of those repairs. These circumstances are insufficient to establish third party beneficiary status. See Young Ref. Corp. v. Pennzoil Co., 46 S.W.3d 380, 387 (Tex.App.-Houston [1st Dist.] 2001, pet. denied) ("The fact that a nonparty might receive an incidental benefit from a contract bestows no right of action to enforce the contract"); see also Raymond, 78 S.W.3d at 561 (a property owner, though receiving a benefit from the work of a subcontractor, is not a third party beneficiary to the contract between the contractor and the subcontractor absent specific language to the contrary).
Spaw objects to improper authentication of pages of documents identified by Maness as "miscellaneous documents produced in litigation by Avex indicating that the agreement between PM Realty, SpawMaxwell Company, and Avex was entered into partially for my benefit . . ." See Tex. R. Evid. 901. Even if Avex provided many of the documents as a result of discovery, they are only authenticated against Avex, not Spaw. See Tex. R. Civ. Proc. 193.7 ("A party's production of a document in response to written discovery authenticates the document for use against that party . . .").
The Standard Form of Agreement and the June 14, 2001 letter do not mention Maness, and there is no language from which to infer an intention to make Maness a third party beneficiary. Even if we assume for argument's sake that the Standard Form of Agreement is the operative contract (as Maness contends), that document's integration clause forecloses Maness' reliance in his affidavit on parol evidence to establish third party beneficiary status. Maness' affidavit falls short in any event because those documents at most establish incidental beneficiary status.
The Standard Form of Agreement contains an integration clause that states, "The contract represents the entire and integrated agreement between the parties. . . ." The presence of an integration clause further precludes the introduction of parol evidence to establish intent of the parties not specified in contract. See Union Pac. R.R. Co., 113 S.W.3d at 423 (refusing to find an ambiguity simply because parties advance different contract interpretations).
Appellant's first and second issues are overruled.
Fraud
Maness next argues that a genuine fact issue exists regarding whether Spaw "committed a fraud," and that his affidavit and the documents attached to it support each of the necessary elements for a fraud claim.
See supra note 3. Spaw has objected to most of the documents provided by Maness, but we need not resolve these objections at this time.
Maness' summary judgment response is nearly silent as to his fraud claim. He fails to address fraud or to make any argument or to cite any authority establishing that summary judgment on his fraud claim is foreclosed. On appeal, Maness' fraud argument is encapsulated in a single sentence: "Likewise, Appellant's affidavit and documentary evidence support each of the similar elements of a fraud cause of action such that the District Court's summary judgment on the fraud claim was improper as well." Because Maness provided no argument or authority to avoid summary judgment on his fraud claim in his summary judgment response, and again fails to do so in his appellate brief, that issue is waived. See Cuyler v. Minns, 60 S.W.3d 209, 216 (Tex.App.-Houston [14th Dist.] 2001, pet. denied); Melendez v. Exxon Corp., 998 S.W.2d 266, 280 (Tex.App.-Houston [14th Dist.] 1999, no pet.) ("The argument in a brief must contain a clear argument for the contentions made, with appropriate citations to the record and to authorities. A point of error not supported by authority is waived").
In the context of a summary judgment, a non-movant is required to expressly present to the trial court any issues defeating the movant's entitlement to summary judgment. Tello v. Bank One N.A., 218 S.W.3d 109, 118 (Tex.App.-Houston [14th Dist.] 2007, no pet.). To "expressly" present issues as required by Rule 166a(c), the written answer or response to the motion for summary judgment must fairly apprise the movant and the trial court of the issues the non-movant contends should defeat the motion for summary judgment. Id. at 119. In determining which issues expressly were presented to the trial court, a reviewing court may not rely on the appellate briefs or the summary judgment evidence. Dubose v. Worker's Med., P.A., 117 S.W.3d 916, 920 (Tex.App.-Houston [14th Dist.] 2003, no pet.).
Maness' fraud claim does not survive even if it is considered on the merits. A fraud cause of action requires a party to establish that (1) a material representation was made, (2) the representation was false, (3) when the speaker made the representation, he knew it was false or made it recklessly without knowledge of the truth and as a positive assertion, (4) the speaker made it with the intention that it should be acted upon by the party, (5) the party acted in reliance upon it, and (6) the party thereby suffered injury. Lundy v. Masson, No. 14-06-00581-CV, 2008 WL 1862331, at *4 (Tex.App.-Houston [14th Dist.] April 29, 2008, no pet. h); see also Formosa Plastics Corp. USA v. Presidio Eng'rs and Contractors, Inc., 960 S.W.2d 41, 47-48 (Tex. 1998).
At no time does Maness identify any fraudulent misrepresentation that is distinct from the alleged negligent misrepresentations. In the single line in which Maness' appellate brief addresses fraud, he refers to the "similar elements" of negligent misrepresentation that underlie his fraud claim.
Even if we consider Maness' affidavit and the attached references, Maness does not establish that Spaw knowingly or recklessly made the misrepresentations with the intent that they be relied upon by Maness. "A promise of future performance constitutes an actionable misrepresentation if the promise was made with no intention of performing at the time it was made." Formosa Plastics Corp. USA, 960 S.W.2d at 47-48. The party alleging fraud must present evidence the misrepresentation was made "with the intent to deceive and with no intention of performing . . . the evidence presented must be relevant to [that party's] intent at the time the representation is made." Formosa Plastics Corp. USA, 960 S.W.2d at 48.
Although Maness repeatedly asserts that he relied upon Spaw's promises concerning the completion date for the reconstruction of his office, and although he repeatedly asserts that the promises were false, he does not establish that Spaw (1) knew the representations were false, (2) acted recklessly with regard to the truth of these representations, or (3) did so with the intent that Maness rely on them. The closest Maness comes to this element of fraud is to state in his appellate brief: "The information presented by Appellee to Appellant and the promises made to Appellant were false and Appellant's evidence shows that Appellee Spaw's representations were made without any care or competence as they continued to make the same false representations over and over." Even this statement fails to assert any knowledge of falsity on Spaw's behalf, and though it might be construed as an allegation Spaw acted with reckless disregarded of the truth, it demonstrates no intent that Maness rely on the representations.
Appellant's third issue is overruled.
Conclusion
The trial court's judgment is affirmed.