Opinion
No. 05-00-02113-CV
Opinion issued June 20, 2002. DO NOT PUBLISH. Tex. R. App. P. 47.
On Appeal from the 296th Judicial District Court Collin County, Texas, Trial Court Cause No. 199-01656-98.
Before Chief Justice THOMAS and Justices FARRIS.and ROSENBERG.
The Honorable David F. Farris, Former Justice, Second District Court of Appeals, Fort Worth, Texas, sitting by assignment.
The Honorable Barbara Rosenberg, Former Justice, Court of Appeals, Fifth District of Texas at Dallas, sitting by assignment.
OPINION
Sam Tawadrous d/b/a Salon De France (Tawadrous), a commercial lease tenant, appeals from the trial court's judgment entered in favor of the landlord, Munir Bata, Individually (Bata), and Munir Bata, L.L.C. (Bata L.L.C.). In two issues, Tawadrous contends (1) the trial court erred in deciding that Bata's and Bata L.L.C.'s misrepresentations, which supported the parties' settlement agreement, were not material, and (2) the trial court erred in awarding attorneys' fees to Bata, L.L.C. We affirm.
Prior to the expiration of the parties' three-year commercial lease agreement, Tawadrous was paying Bata and Bata, L.L.C. $15.00 a square foot to lease 1,125 square feet of space for his hair salon. Soon after that lease expired, Tawadrous filed suit against Bata, individually, requesting injunctive relief to stop Bata from entering and threatening to oust Tawadrous from the leased premises. Bata filed his answer and general denial, and soon thereafter, Bata, L.L.C. intervened and filed its answer, general denial, and counterclaim for breach of the lease agreement, namely for failure to pay proper rents. Bata, L.L.C. also sought attorneys' fees.
Thereafter, the parties entered into a mediated settlement agreement. After Bata represented that other tenants in the building paid $19.00 a square foot, the parties agreed that Tawadrous would exercise his three-year lease renewal option and pay $17.50 a square foot for the first year, $18.00 for the second year, and $18.50 for the third year. Tawadrous subsequently withdrew his consent to the settlement agreement because he believed Bata fraudulently misrepresented what the other tenants were paying. Despite numerous requests for documentation to verify what those tenants were paying, Bata refused to provide that information. Tawadrous filed a motion to compel production of the other tenants' leases, and after a hearing, Bata produced one lease agreement showing that the tenant paid $18.66.
The reporter's record reflects dollar figures of $18.60 and $18.66. However, because the reporter's record also notes the trial court's calculation of a $.34 difference, we believe the $18.66 figure to be the accurate rental rate.
Bata and Bata, L.L.C. then filed a motion to enforce the terms of the settlement agreement and a motion to dismiss the parties' underlying claims based on that agreement. In response, Tawadrous opposed the motion to dismiss because he had already withdrawn his consent to the settlement agreement. Bata and Bata, L.L.C. then amended their pleadings to bring a cause of action against Tawadrous to enforce the settlement agreement. In these amended pleadings, Bata and Bata, L.L.C. alleged that Tawadrous failed to pay the new rental rate as stated in the settlement agreement.
The trial court subsequently held a bench trial, heard evidence submitted by stipulation, and entered its judgment, enforcing the settlement agreement and effectually dismissing the parties' underlying claims. The trial court awarded Bata, L.L.C. $7,171.07 in damages and $7,500.00 in attorneys' fees. This appeal ensued.
Tawadrous first contends the trial court erred in upholding the settlement agreement because Bata fraudulently induced him to enter into it. Specifically, Tawadrous argues that the trial court erred in finding that the $.34 discrepancy between what Bata represented the other tenant's rent to be ($19.00) and what that tenant actually paid ($18.66) was not a material misrepresentation.
We construe this argument as a challenge to the legal and factual sufficiency of the evidence supporting the trial court's implied findings of fact. Because findings of fact were neither filed nor requested, the trial court's judgment implies that all necessary findings of fact existed to support it. See Ryan v. Abdeal-Salam, 39 S.W.3d 332, 335 (Tex. App.-Houston [1st Dist.] 2001, pet. denied). Where, as here, a reporter's record has been filed, the appellant may challenge the implied findings for legal and factual insufficiency ?the same as jury findings.? See Shamburger v. Conoco, Inc., 999 S.W.2d 462, 465 (Tex. App.-Amarillo 1999, pet. denied) (quoting Roberson v. Robinson, 768 S.W.2d 280, 281 (Tex. 1989)).
In reviewing the legal sufficiency of the evidence, we consider only the evidence and reasonable inferences tending to support the implied finding, viewing it in the light most favorable to the verdict. See Ryan, 39 S.W.3d at 335. We will overrule a legal sufficiency challenge if there is more than a scintilla of evidence to support the implied finding. See id. When reviewing a factual sufficiency challenge, we consider all the evidence, both in support of and contrary to the challenged implied finding, and uphold the implied finding unless it is against the great weight and preponderance of the evidence so as to be manifestly unjust. See id.
To prevail in his fraudulent inducement claim, Tawadrous had to prove: (1) a material representation was made; (2) the representation was false; (3) the speaker knew the representation was false when made or made it recklessly without any knowledge of its truth; (4) the speaker made the representation with the intent it should be acted upon by the party; (5) the party acted in reliance upon the representation; and (6) the party thereby suffered injury. Eagle Props., Ltd. v. Scharbauer, 807 S.W.2d 714, 723 (Tex. 1990). A representation is ?material? if it is important to the party to whom it is made in making a decision regarding the particular transaction. Burleson State Bank v. Plunkett, 27 S.W.3d 605, 613 (Tex. App.-Waco 2000, pet. denied). ?'Material' means a reasonable person would attach importance to and would be induced to act on the information in determining his choice of actions in the transaction in question.? Id. (quoting Amer. Med. Int'l, Inc. v. Giurintano, 821 S.W.2d 331, 338 (Tex. App.-Houston [14th Dist.] 1991, no writ)).
Before deciding that Bata's misrepresentation was not material, the trial court heard the following stipulated evidence from Tawadrous's attorney, R. Scott Steinbach:
STEINBACH: My client repudiated the settlement agreement which was reached in the mediation, signed up about a week later on the — for the reason that he had discovered that in his mind that the Defendant had made a misrepresentation during the mediation.
COURT: And what was the nature of that misrepresentation?
STEINBACH: My client was advised during the mediation that a particular tenant in the shopping center was paying $19 a foot; and at that point in time, a hold-up in the mediation was how much would we agree to pay. And we ultimately agreed to pay, I believe it was $18 a foot and there was a stair-step approach.
Yeah, it started out at [$]17.50 for the first year, $18 for the second year, $18.50 for the third year, is what we agreed to.
Now, some period after that, about a week later, my client had discovered that tenant was not paying $19 a foot; and that, as you recall, became the subject of a discovery fight between the parties and the lease was ultimately produced.
COURT: So what was the result of that?
* * *
STEINBACH: Okay. It is $18.60 [sic] is what it actually was, and it was represented it was [$]19, so my client-
COURT: So we are talking about 34 cents a foot?
STEINBACH: Yes, your Honor.
COURT: Well, the Court doesn't think that's very material. Is that the whole basis of your repudiation of the mediated settlement agreement?
* * *
STEINBACH: The initial repudiation was the $19 a foot representation which he believed to be a misrepresentation, which turned out to be $18.66.
COURT: Well, the Court can readily and speedily find that that is not a material misrepresentation, and the Court is going to uphold the mediated settlement agreement.
Although Tawadrous presented evidence that the rental amount was the reason for the ?hold-up? in the mediation, which arguably showed that the rental amount was an important matter to Tawadrous, there was no evidence that a reasonable person would have attached importance to the $.34 differential in agreeing to the graduated pay scale. That the other tenant paid $1.16, $.66, and $.16 above what Tawadrous agreed to pay under the three-year settlement agreement tends to support the inference that a reasonable person would not have attached importance to the $.34 difference. Considering only the evidence tending to support the implied finding, viewing it in the light most favorable to the verdict, we find more than a scintilla of evidence to support the implied finding that the misrepresentation was not material. Even when considering all the evidence, both in support of and contrary to the challenged implied finding, we cannot say that this finding was against the great weight and preponderance of the evidence so as to be manifestly unjust. We resolve this issue in favor of Bata and Bata, L.L.C.
In his second issue, Tawadrous contends the trial court erred in awarding attorneys' fees to Bata, L.L.C. because it did not prevail on its breach of contract theory. Alternatively, Tawadrous argues that Bata, L.L.C. (1) failed to present its claim as required by Texas Civil Practice and Remedies Code section 38.002; and (2) failed to segregate its attorneys' fees. We review the trial court's decision to award attorneys' fees based on an abuse of discretion standard. See Thomas v. Thomas, 917 S.W.2d 425, 436 (Tex. App.-Waco 1996, no writ).
As a general rule, the party seeking to recover attorneys' fees carries the burden of proving it is entitled to them. Lesikar v. Rappeport, 33 S.W.3d 282, 317 (Tex. App.-Texarkana 2000, pet. denied). A party may recover reasonable attorneys' fees if the claim is valid and based on a written contract. Tex. Civ. Prac. Rem. Code Ann. ? 38.001(8) (Vernon 2000). Because the trial court ruled that Bata, L.L.C.'s breach of contract counterclaim was valid, Bata, L.L.C. properly predicated its recovery for attorneys's fees under section 38.001(8). See Tex. Civ. Prac. Rem. Code Ann. ? 38.001(8).
We next determine whether Bata, L.L.C. satisfied the presentment requirement for recovery of attorneys' fees. To recover attorneys' fees, the claimant must present the claim to the opposing party. Tex. Civ. Prac. Rem. Code Ann. ? 38.002(2). The purpose of the presentment requirement is to allow the person against whom a claim is asserted an opportunity to pay within 30 days of receiving notice of the claim, without incurring an obligation for attorneys' fees. Carr v. Austin Forty, 744 S.W.2d 267, 271 (Tex. App.-Austin 1987, writ denied). The plaintiff must plead and prove that he or she presented a contract claim to the opposing party, and the opposing party failed to tender performance. See id. No particular form of presentment of a claim is required. Id. The word ?present? has been defined to mean simply a demand or request for payment. See Jim Howe Homes, Inc. v. Rogers, 818 S.W.2d 901, 905 n. 3 (Tex. App.-Austin 1991, no writ).
Here, Bata, L.L.C. expressly requested attorneys' fees in its third amended intervention, answer, and counterclaim, which included its breach of contract counterclaim. However, neither the filing of a suit, nor the allegation of a demand in the pleadings can, alone, constitute a presentment of a claim or a demand that the claim be paid. See Austin Forty, 744 S.W.2d at 271. Bata, L.L.C. makes no reference to the record, nor do we find any place in the record, to indicate further evidence that Bata, L.L.C. presented its claim. Instead, Bata, L.L.C. argues that Tawadrous waived error by not objecting to its failure to present its claim. We agree. Tawadrous makes no reference in the appellate record, nor do we find any place in the record, to indicate Tawadrous objected to Bata, L.L.C.'s failure to prove presentment. See Jim Howe Homes, 818 S.W.2d at 905 (finding that appellant preserved error on presentment issue by making its objection in its motion for judgment n.o.v.). Accordingly, Tawadrous has not preserved error on his presentment argument. See Tex. R. App. P. 33.1(a).
With regard to the failure to segregate, again, we find no place in the record where Tawadrous made this specific objection. When a party seeks to recover attorneys' fees in a case in which he or she is asserting multiple claims, that party must offer evidence segregating attorneys' fees among those various claims. See Lesikar, 33 S.W.3d at 317. However, where no objection is made to that party's failure to segregate attorneys' fees at the time evidence of attorneys' fees is presented, the error is waived. See id; see also Hruska v. First State Bank of Deanville, 747 S.W.2d 783, 785 (Tex. 1988). Here, Tawadrous has waived any such error. Accordingly, Tawadrous has not shown that the trial court abused its discretion in awarding $7,500 in attorneys' fees to Bata, L.L.C.
We resolve this issue in favor of Bata and Bata, L.L.C.
In one cross-issue, Bata and Bata, L.L.C. assert this appeal is frivolous and seek damages pursuant to rule 45 of the Texas Rules of Appellate Procedure. Although imposing sanctions is within our discretion, we will do so only in circumstances that are truly egregious. See City of Houston v. Precast Structures, Inc., 60 S.W.3d 331, 340 (Tex. App.-Houston [14th Dist.] 2001, pet. denied). Where an argument on appeal fails to convince the court, but has a reasonable basis in law and constitutes an informed, good-faith challenge to the trial court's judgment, sanctions are not appropriate. Id. While we disagree with Tawadrous's appellate arguments, the appeal was not frivolous, and no sanctions are warranted. We resolve this cross-issue in favor of Tawadrous.
We affirm the trial court's judgment.