Affirmed and Memorandum Opinion filed November 29, 2011.

In The

Fourteenth Court of Appeals

NO. 14-10-01227-CV

LI LI D/B/A VILLA RESIDENTIAL DESIGN STUDIO, Appellant

V.

1821 WEST MAIN DEVELOPMENT LLC, Appellee

On Appeal from the 269th District Court

Harris County, Texas

Trial Court Cause No. 2008-57290

M E M O R A N D U M O P I N I O N

In this breach of contract case, appellant Li Li d/b/a Residential Design Studio 

(―Li Li‖) challenges the trial court’s conclusion that she breached an oral agreement with 

1821 West Main Development LLC (―West Main‖).1 Li Li first asserts that there is no 

evidence or insufficient evidence to establish that she had a contract with West Main 

because (a) West Main’s pleadings do not support this claim and (b) she was not aware 

that she was contracting with West Main and instead believed she was contracting with 

another developer, Gary Lee of Watermark Homes (―Watermark‖). She further 

challenges the evidence to support the trial court’s damages award. We affirm.

 

1 Li Li’s notice of appeal and brief both list ―Seven Bricks, Inc.‖ as an additional appellee; however, she 

raises no appellate issues regarding this entity. 
2

BACKGROUND

In 2006, West Main purchased property located at 617 Wellesley in Hunter’s 

Creek Village, Harris County. Imran Maniar, a principal of West Main and Seven 

Bricks, was introduced to Li Li, an experienced high-end residential home designer, by 

Gary Lee of Watermark. The two met at the Watermark offices, where they entered into 

an oral agreement for Li Li to design a home for the Wellesley property.2 As part of this 

agreement, Li Li charged Maniar a lower-than-usual rate in return for Maniar’s

agreement to provide certain documentation, including a survey of the property, and to 

perform the ―leg work‖ of taking the design plans to the appropriate authorities for 

approval. Li Li had provided a similar discount to other developers under these same 

general terms.

One of Maniar’s employees, a student named Yasir Khan, contacted Li Li and 

provided her with a survey of the property. However, the survey was old and did not 

include several of the set-back lines. Khan also provided Li Li the contact information 

for the building official for Hunter’s Creek Village, Dennis Holm. 

Li Li prepared her first home design plans for the Wellesley property sometime in 

April 2007, about three to four months after she had been engaged. These plans were 

rejected because they did not comply with the appropriate property set-backs. After 

several communications between Li Li, Holm, Khan, and Maniar, Li Li provided new 

plans a few months later. These plans were likewise rejected because of a mistake Li Li 

made. Several revisions to the plans ensued. Each time Li Li submitted new design 

plans, they had to be drawn up by an engineering firm at considerable cost. Ultimately, 

Maniar asked Gary Lee at Watermark to take over the project because Lee had a better 

working relationship with Li Li. West Main paid Watermark $88,000 to take over the 

project. After Watermark took over the project, Lee discovered the necessity of a home 

 

2 At no time during the meeting did Maniar disclose to Li Li that he was acting on behalf of West Main or 

Seven Bricks. 
3

owner’s association approval. Maniar had informed Holm at Hunter’s Creek Village that 

such approval was not required.

The residential design plans were finally approved almost a year after Li Li 

initially undertook the project. These plans were not the ones that Li Li had submitted to 

Maniar. Instead, they were plans from a prior project with Watermark that Li Li

modified to fit the Wellesley property. The plans were approved both by Hunter’s Creek 

Village and the appropriate homeowner’s association. The house that Li Li designed was 

built on the Wellesley property and sold shortly thereafter.

In September 2008, West Main and Seven Bricks, Inc. sued Li Li, claiming that 

she had orally contracted with Seven Bricks, Inc., that she breached that contract by 

failing to timely provide design plans, and that Seven Bricks suffered damages of 

$80,000, which it would have been paid had it completed the project. West Main was 

named as a third-party beneficiary to the contract. West Main alleged damages of 

$82,367.46 for loan carrying costs, re-engineering fees, and additional permitting fees. 

Seven Bricks and West Main also alleged that Li Li was negligent and that their damages 

were the same as their alleged contract damages. Li Li generally denied the allegations. 

In February 2009, Li Li filed a counter-claim. In her petition, she sued Seven 

Bricks and West Main. Specifically, she asserted the following in the ―Factual 

Background‖ of her petition:

Counter-defendants [Seven Bricks and West Main] engaged Li Li to 

perform design work for a number of projects in Harris County, including 

the project that forms the basis of Plaintiffs’ complaints in this lawsuit. Li 

Li performed the work requested by Counter-defendants. However, 

Counter[-]defendants made some payments but failed to pay Li Li the full 

agreed upon amounts for the design services rendered on these projects. 

The amount that remains owing to Li Li is $7,560.06.

Under the ―Causes of Action‖ portion of her petition, Li Li asserted that Seven Bricks 

and West Main had breached their contract with her:
4

Li Li had a valid and enforceable agreement with Counter-defendants. Li Li 

fully performed all conditions, covenants and obligations under the 

agreement with Counter[-]defendants, but Counter-defendants refused or 

failed to perform in compliance with its obligations. Counter-defendants 

have therefore breached the provisions of the contract with Li Li. Because 

of such breaches, Li Li has sustained actual damages exceeding the 

minimum jurisdictional limits of the Court, for which she now seeks 

recovery. Additionally, Li Li has incurred reasonable and necessary 

attorney’s fees for the prosecution of this suit for which she also seeks 

recovery.

This case was tried to the bench in June 2010. The trial court found that Li Li 

breached her contract with West Main and that West Main breached its contract with her. 

It awarded West Main damages in the amount of $154,214.60 and attorney’s fees of 

$13,000. It awarded Li Li offsetting damages of $7,600 and $3,500 in attorney’s fees. 

Prior to rendering judgment on September 29, 2010, the trial court signed the following 

findings and conclusions on June 24, 2010:

FINDINGS OF FACT

1. Plaintiff 1821 West Main Development, L.L. C. (―1821 West Main‖) 

purchased property located at 613 Wellesley (―Wellesley Property‖) 

in Hunter’s Creek Village in 2006.

2. 1821 West Main retained Plaintiff Seven Bricks, Inc. (―Seven 

Bricks‖) to construct a house on the Wellesley Property.

3. Imran Maniar acting on behalf of 1821 West Main retained 

Defendant Li Li d/b/a Villa Residential Design Studio to design the 

house for the Wellesley Property as well as houses to be constructed 

on property owned by 1821 West Main on Pine Forest and Reba

streets.

4. In the oral agreement between Li and 1821 West Main, Li agreed to 

design the houses on the Wellesley Property, as well as on Pine 

Forest and Reba, and 1821 agreed to perform the leg work of taking 

the plans for the houses to the applicable local government

permitting authorities and homeowners’ associations for approval 

and to return rejected plans to Li.

5. 1821 West Main agreed to pay Li $1.50/ft2of framed space for her 

designs.
5

6. Seven Bricks did not prove by a preponderance of evidence that it 

was a party to the agreement between Li and 1821 West Main.

7. Li did not timely produce adequate plans for government and 

homeowners’ association approvals.

8. Li failed to comply with her agreement with 1821 West Main.

9. Li’s failure to comply with the agreement caused 1821 West Main to 

experience out-of-pocket damages of $154,214.60.

10. Li was negligent.

11. The negligence of Li proximately caused damages to 1821 West 

Main in the amount of $154,214.60.

12. 1821 West Main was not negligent.

13. Seven Bricks was not negligent.

14. 1821 West Main has not complied with its agreement with Li to pay 

her for her designs.

15. 1821 West Main’s failure to comply with the agreement caused Li to 

experience damages of $7,600.00.

16. The reasonable and necessary amount of attorneys’ fees that 1821 

West Main incurred in prosecuting its claim is $13,000.00.

17. The reasonable and necessary amount of attorneys’ fees that Li 

incurred in prosecuting her counterclaim is $3,500.00.

18. To the extent that any Conclusion of Law is more properly 

characterized as a Finding of Fact, it is ADOPTED as such.

CONCLUSIONS OF LAW

1. Li owed a duty of ordinary care to 1821 West Main and Seven 

Bricks.

2. The Court concludes that 1821 West Main should recover 

prejudgment interest at a rate of 6% simple interest for the period of 

September 29, 2008, through the day preceding the date judgment is 

rendered.

3. The Court concludes that 1821 West Main should recover post 

judgment interest at a rate of 6% compounded annually for the 

period beginning on the date the judgment is rendered and ending on 

the date the judgment is satisfied.

4. The Court concludes that Li should recover prejudgment interest at a 

rate of 6% simple interest.
6

5. The Court concludes that Li should recover post judgment interest at 

a rate of 6% compounded annually for the period beginning on the 

date the judgment is rendered and ending on the date the judgment is 

satisfied.

6. To the extent that any Finding of Fact is more properly characterized 

as a Conclusion of Law, it is ADOPTED as such.

Li Li’s requested amended findings and conclusions, but the trial court did not rule on her 

request. Her motion for new trial was overruled by the trial court, and this appeal timely 

followed.

ANALYSIS

A. West Main’s Breach of Contract Claim

In her first issue, Li Li asserts that West Main was not entitled to recover 

contractual damages against her because no such recovery is supported by West Main’s 

pleadings and because there was no evidence or insufficient evidence to support an oral

agreement or a finding of breach by Li Li. We consider first whether the pleadings 

support West Main’s recovery of contract damages, then turn to the sufficiency of the 

evidence to support the finding that there was an oral contract and that Li Li breached this

contract.

We agree with Li Li that West Main’s pleadings, which cast West Main as a thirdparty beneficiary to an alleged contract between her and Seven Bricks, do not support 

West Main’s recovery under a direct breach-of-contract theory. However, issues not 

raised by the pleadings may be tried by the express or implied consent of the parties. See 

Tex. R. Civ. P. 67; Moore v. Altra Energy Techs., Inc., 321 S.W.3d 727, 733 (Tex. 

App.—Houston [14th Dist.] 2007, pet. denied). Here, during Li Li’s counsel’s 

examination of Maniar, the following testimony was elicited:

Q: When you met with Li Li to discuss these three projects, the 

Wellesley, Reba, Pine Forest, and when you eventually hired her to 

do the design work on these three projects, were you doing that on 

behalf of 1821 West Main Development?
7

A: 1821 West Main Development owned Wellesley and Reba. The Pine 

Forest was owned by another investor.

. . .

Q: So when you hired Li Li to do the design work, who was - - who was 

hiring Li Li?

A: Seven Bricks was hiring Li Li for the Pine Forest project. 1821 West 

Main was hiring her for the other two projects.

. . .

Q: And in making that contract, you were acting on behalf of 1821 West 

Main Development?

A: On the Wellesley project.

. . .

Q: Okay. I’m sorry. So you were acting on behalf of 1821 West Main 

Development in making a contract for the Wellesley property with Li 

Li?

A: That’s correct.

. . .

Q: Well, the agreement was between - - I think you just told me - -

between 1821 West Main Development and Li Li?

A: Right . . . .

(emphasis added). These questions and responses directly relate to the issue of whether 

West Main was a primary party to the oral agreement regarding the Wellesley property. 

They have no bearing whatsoever on whether West Main was a third-party beneficiary to 

any other contract. Accordingly, this unobjected-to testimony adequately notified Li Li 

that the issue of whether West Main and she had an oral contract was being ―tried.‖ Tex. 

R. Civ. P. 67.

Regarding the sufficiency of the evidence to support the trial court’s finding that 

Li Li had an oral contract with West Main, as described above, Li Li filed a counterclaim in this case. In her counter-claim, she acknowledged that she had a valid oral 

agreement with both Seven Bricks and West Main. Such an assertion of fact, not pled in 

the alternative, in the live pleadings of a party is regarded as a formal judicial admission, 

precluding the party from later disputing the admitted fact. Holy Cross Church of God in 
8

Christ v. Wolf, 44 S.W.3d 562, 568 (Tex. 2001) (citing Houston First Am. Sav. v. Musick, 

650 S.W.2d 764, 767 (Tex. 1983) and Gevinson v. Manhattan Constr. Co., 449 S.W.2d 

458, 467 (Tex. 1969)). Because Li Li judicially admitted that she had a contract with 

West Main, she cannot dispute the existence of the contract. See id. Additionally, the 

unobjected-to testimony recited above, coupled with Li Li’s judicial admission that she 

had a contract with West Main, vitiate her arguments that the contract did not exist 

because she did not have a ―meeting of the minds‖ with West Main or that Manier was 

acting as an agent of an undisclosed principal.

Regarding the evidence supporting a finding of breach of this contract by Li Li, in 

reviewing a trial court’s findings of fact for legal and factual sufficiency of the evidence, 

we apply the same standards we apply in reviewing the evidence supporting a jury’s 

answer. Catalina v. Blasdel, 881 S.W.2d 295, 297 (Tex. 1994). When the appellate 

record contains a reporter’s record, as it does in this case, findings of fact are not 

conclusive on appeal if a contrary fact is established as a matter of law or if there is no 

evidence to support the finding. See Material P’ships, Inc. v. Ventura, 102 S.W.3d 252, 

257 (Tex. App.—Houston [14th Dist.] 2003, pet denied).

A contracting party breaches a contract by failing to complete performance of the 

contract within a reasonable time. See Bencon Mgmt. & Gen. Contracting, Inc. v.Boyer,

Inc., 178 S.W.3d 198, 205–06 (Tex. App.—Houston [14th Dist.] 2005, no pet.). Here, 

Gary Lee of Watermark testified that he expected Li Li to be familiar with the provisions 

of the city building codes and that she was responsible for complying with these codes. 

He also testified that a ―commercially reasonable‖ amount of time for a designer to get a 

plan to a city is between three and four months. Dennis Holm of Hunter’s Creek Village 

testified that the Wellesley project ―seemed that it just kept going on and on and on.‖ He 

further stated that the city’s building rules were available on-line and that in his two-year 

tenure at Hunter’s Creek Village, no home took longer to get approval than the one at 617 

Wellesley. Maniar testified that he became frustrated with Li Li around five to six 

months into the project because ―she had no clue how to get plans to [the city] at that 
9

time.‖ He further testified that in the 55 homes he had built, it never took longer than 

three months to get the necessary building plan approvals. 

All of this testimony supports the trial court’s finding that Li Li did not timely 

produce adequate plans for Hunter’s Creek Village approval. We conclude that 

reasonable factfinders could credit this finding; thus legally sufficient evidence supports 

it. See City of Keller, 168 S.W.3d at 827. Further, the finding is not so weak or the 

evidence to the contrary so overwhelming that it should be set aside. See Burlington N. 

& Santa Fe Ry., 174 S.W.3d at 354.

Accordingly, this finding is supported by legally and factually sufficient evidence. 

This finding supports the trial court’s conclusion that Li Li failed to comply with her 

agreement with 1821 West Main. See Bencon Mgmt. & Gen. Contracting, Inc., 178 

S.W.3d at 205–06. Because Li Li judicially admitted that she had a valid and enforceable 

contract with West Main and because legally and factually sufficient evidence supports 

the trial court’s finding of breach, we overrule Li Li’s first issue.

B. Sufficient Evidence Supports the Damages Awarded to West Main

In her second issue, Li Li asserts that the evidence is legally and factually 

insufficient to support the damages awarded to West Main. As noted above, we consider 

the legal and factual sufficiency of a trial court’s findings under the same standards as 

applied to a jury’s findings.

Here, the following uncontroverted testimony supports the trial court’s damages 

award of $154,214.60 to West Main:

The interest incurred on the construction loan that West Main procured to 

cover construction costs of the Wellesley property was $3,816.56 between 

June of 2007 when Li Li breached the agreement and the property was sold 

in February of 2008;

The interest incurred on the mortgage West Main took procured to purchase 

the Wellesley property during that same time period was $39,610.60;

West Main paid Watermark $88,000 to take over construction of the 

project;
10

During that same period of time, taxes totaling $5,887.45 were incurred;

Re-engineering fees based on Li Li’s unusable plans cost $7,300; and

Li Li was paid $9,600 for her unused plans.

These amounts total $154,214.61, which is one penny more than the damages 

found by the trial court.

3

 Additionally, although West Main did not plead for the interest 

accrued on its property loan during Li Li’s breach, this issue was tried by consent. See 

Tex. R. Civ. P.67 (explaining that ―issues not raised by the pleadings are tried by express 

or implied consent of the parties [and] shall be treated in all respects as if they had been 

raised in the pleadings‖). Testimony regarding the property interest loan and the accrued 

interest on the loan was introduced without objection. Specifically, Maniar explained 

which months Li Li was in breach and then concluded that, based on the interest accrued 

on the property loan, she was liable for identified sum. This unobjected-to testimony

adequately notified Li Li that this issue was being ―tried.‖ Tex. R. Civ. P. 67.

Under these circumstances, we conclude that reasonable factfinders could credit 

the evidence supporting this finding and there is no controverting evidence regarding this 

finding. Accordingly, the trial court’s damages award is supported by legally and 

factually sufficient evidence. Li Li’s second issue is overruled.

CONCLUSION

We have overruled each of Li Li’s issues on appeal. We affirm the trial court’s 

judgment.

/s/ Adele Hedges

Chief Justice

Panel consists of Chief Justice Hedges and Justices Brown and McCally.

 

3 Although Li Li challenges the award of attorneys’ fees on appeal, the parties stipulated to these amounts 

in the trial court. Thus, this portion of her issue provides no basis for relief.