Reversed and Rendered and Opinion filed July 10, 2012.

In The

Fourteenth Court of Appeals

NO. 14-10-01157-CV

JERRY DOHALICK, Appellant

V.

MOODY NATIONAL BANK, Appellee

On Appeal from the 333rd District Court

Harris County, Texas

Trial Court Cause No. 2008-08162

O P I N I O N

This case presents a question of first impression regarding the statutory 

construction of Chapter 156 of the Texas Finance Code, which permits an “aggrieved 

person” to recover certain damages from an unlicensed person who receives a fee for 

acting as a mortgage broker. The trial court found that the claimant in this case, a bank,

was an “aggrieved person” under Texas Finance Code section 156.406(b) based on the 

trial court’s determination that the bank paid the appellant/defendant a fee for acting as a 

mortgage broker without that individual having an active license or being exempt under 

the statute. We conclude that, to be an aggrieved person under section 156.406(b), the 
2

claimant must pay all or part of the mortgage broker’s fee. But, we conclude that the trial 

evidence is legally insufficient to support a finding that the bank paid any part of this fee. 

Accordingly, we reverse the trial court’s judgment in part and render judgment that the 

bank take nothing against the appellant. 

I. FACTUAL AND PROCEDURAL BACKGROUND

Savoy Custom Homes, L.P. was a builder of custom homes in the Houston area. 

The principals of Savoy were Igor Dukhin, a/k/a Gary Duncan, and Thad Moore. 

Duncan and Moore contacted appellant/defendant Jerry Dohalick regarding Savoy’s need 

for another line of credit to finance the construction of additional houses. Dohalick 

agreed to help Savoy seek additional financing, and Savoy agreed to pay Dohalick a fixed 

fee of one percent of the amount of the line of credit that Savoy obtained with Dohalick’s 

assistance. 

Dohalick contacted several lenders seeking to obtain additional financing for 

Savoy. As part of these efforts Dohalick contacted Tina McGriff of appellee/plaintiff 

Moody National Bank (the “Bank”). Dohalick introduced McGriff to Duncan and Moore 

and, at various times, Dohalick served as an intermediary between Savoy and the Bank. 

In May 2007, the Bank approved an “officer guidance line” for Savoy in the amount of 

five million dollars. But, before Savoy could receive any financing for a particular 

construction project, Savoy was required to present various documents to the Bank for 

approval. If the Bank approved, then the Bank and Savoy would need to execute various 

loan documents regarding the financing of the particular project before Savoy could 

obtain any funds from the Bank. 

In an effort to obtain financing for the construction of one house, Savoy assembled 

documents to present to the Bank. Duncan gave these documents to Dohalick, and 

Dohalick submitted them to the Bank. These documents allegedly contained false or 

misleading statements. The Bank approved a loan to Savoy for this project. Savoy 

executed a promissory note and deed of trust on October, 15, 2007, and the Bank and 
3

Savoy entered into various agreements regarding this loan (the “Loan”). Under these 

agreements, the Bank was to make an initial advance of $700,000 plus the loan closing 

costs. After the initial advance, upon written request by Savoy and approval by the Bank, 

the Bank would make additional advances. On October 16, 2007, Savoy received the 

initial advance from the Bank in the amount of approximately $719,000. Two days later, 

Savoy submitted a written request for an additional advance of $65,000. The Bank 

approved this request and Savoy received the requested funds on the same day. The 

following day, on October 19, 2007, Savoy paid Dohalick $50,000 as the fee for his 

services. Though the evidence was conflicting, some evidence at trial showed that Savoy 

paid Dohalick’s fee by using $50,000 of the loan proceeds that Savoy had received from 

the Bank the day before. It is undisputed that during the rendition of his services on 

behalf of Savoy, Dohalick did not hold an active mortgage broker license under Chapter 

156 of the Finance Code, nor did Dohalick fall within the exemptions contained in 

Chapter 156.1 

After making two or three interest-only payments on the Loan, Savoy defaulted, 

and the Bank eventually foreclosed on its deed-of-trust lien on the property on which the 

house was to be constructed. In January 2008, Savoy, Duncan, Moore, and others 

allegedly engaged in a fraudulent scheme involving check kiting using Savoy’s checking 

account at the Bank. When the Bank made inquiries regarding matters related to the

alleged check kiting, Dohalick allegedly responded on Savoy’s behalf. 

The Bank filed suit in the trial court below against Savoy, Duncan, Moore, 

Dohalick and others. The Bank alleged, among other things, that (1) Savoy submitted 

fraudulent financial documents to the Bank to obtain approval of the Loan, (2) the 

defendants were involved in check kiting or a check-fraud scheme that caused the Bank 

to sustain damages; (3) Dohalick and Duncan engaged in a scheme to obtain funds from 

the Bank to pay Dohalick’s fee; (4) Duncan falsely represented to the Bank that the 

$65,000 advance was for “soft costs”; and (5) in response to the Bank’s inquiries relating 

 

1 Unless otherwise specified, all statutory references in this opinion are to the Texas Finance Code.
4

to the alleged check kiting, Dohalick made false representations to the Bank. The Bank 

asserted fraud, in addition to other claims, against all defendants, including Dohalick. 

The Bank also asserted a claim against Dohalick under section 156.406(b) to recover 

damages based upon the fee Dohalick received in connection with the Loan. 

When the trial court called the case to trial, the Bank announced that it had nonsuited and was no longer pursuing any claims against Dohalick other than the claim under 

section 156.406(b). Following a bench trial, the trial court rendered judgment in the 

Bank’s favor against various defendants. Based on the Bank’s claim under section 

156.406(b), the trial court awarded the Bank $50,000 in damages plus prejudgment and 

postjudgment interest. In its findings of fact and conclusions of law, the trial court found 

as follows:

The Loan is a “mortgage loan” as defined in section 156.002.

Dohalick acted as a “mortgage broker” as defined in section 156.002.

Dohalick received a fee of $50,000 for acting as a mortgage broker in connection 

with the Loan.

Dohalick did not have an active mortgage broker’s license at the time of the Loan.

Dohalick was not exempt from having a mortgage broker’s license under Chapter 

156 at the time of the Loan. 

Savoy requested that Dohalick’s fee be paid by the Bank.

Dohalick requested that his fee be paid by the Bank.

The Bank paid Dohalick’s fee of $50,000.

The Bank is an “aggrieved person” under section 156.406(b) because the Bank 

paid Dohalick’s fee.

The Bank is entitled to damages in the amount of $50,000 from Dohalick under 

section 156.406(b). 

II. ISSUES PRESENTED

On appeal, Dohalick asserts that (1) the evidence is legally insufficient to support 

the trial court’s finding that the Bank paid Dohalick’s fee and therefore the Bank cannot 

be an aggrieved person under section 156.406(b); (2) the Loan was not a “mortgage loan” 
5

as defined in section 156.002; (3) regarding the Loan, Dohalick did not act as a 

“mortgage broker” as defined in section 156.002; and (4) Chapter 156 should not be 

applied to Dohalick.

III. STANDARD OF REVIEW

Dohalick challenges the legal sufficiency of the evidence supporting the trial

court’s finding that the Bank paid Dohalick’s fee. When reviewing the legal sufficiency 

of the evidence, we consider 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, 823 (Tex. 2005). We must credit favorable evidence if a 

reasonable factfinder could and disregard contrary evidence unless a reasonable 

factfinder could not. See id. at 827. We must determine whether the evidence at trial 

would enable reasonable and fair-minded people to find the facts at issue. See id. The 

factfinder is the only judge of witness credibility and the weight to give to testimony. See 

id. at 819.

IV. ANALYSIS

A. Who may be an “aggrieved person” under Texas Finance Code section 

156.406(b)?

Under his first issue, Dohalick argues that Bank cannot be an aggrieved person 

under section 156.406(b). The version of this statute applicable to the case under review

provides as follows:

A person who received money, or the equivalent of money, as a fee or 

profit because of or in consequence of the person acting as a mortgage 

broker or loan officer without an active license or being exempt under this 

chapter is liable for damages in an amount that is not less than the amount 

of the fee or profit received and not to exceed three times the amount of the 

fee or profit received, as may be determined by the court. An aggrieved 

person may recover damages under this subsection in a court.

Act of May 25, 1999, 76th Leg., R.S., ch. 1254, § 2, 1999 Tex. Gen. Laws 4334, 4346 
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(current version at Tex. Fin. Code Ann. § 156.406(b) (West 2012)).

2

 The statute does not 

define the term “aggrieved person.” See id. The parties have not cited and research has 

not revealed any case addressing who may be an aggrieved person under this statute. 

We review the trial court’s interpretation of applicable statutes de novo. See 

Johnson v. City of Fort Worth, 774 S.W.2d 653, 655B56 (Tex. 1989). In construing a 

statute, our objective is to determine and give effect to the Legislature’s intent. See Nat’l 

Liab. & Fire Ins. Co. v. Allen, 15 S.W.3d 525, 527 (Tex. 2000). If possible, we must 

ascertain that intent from the language the Legislature used in the statute and not look to 

extraneous matters for an intent the statute does not state. Id. If the meaning of the 

statutory language is unambiguous, we adopt the interpretation supported by the plain 

meaning of the provision’s words. St. Luke’s Episcopal Hosp. v. Agbor, 952 S.W.2d 503, 

505 (Tex. 1997). We must not engage in forced or strained construction; instead, we 

must yield to the plain sense of the words the Legislature chose. See id.

Under the plain meaning of section 156.406(b), the damages that an aggrieved 

person may recover are “damages in an amount that is not less than the amount of the fee 

or profit received and not to exceed three times the amount of the fee or profit received, 

as may be determined by the court.” Act of May 25, 1999, 1999 Tex. Gen. Laws at 4346. 

An “aggrieved person” may recover these damages based upon the mortgage broker’s 

receipt of “money, or the equivalent of money, as a fee or profit because of or in 

consequence of the person acting as a mortgage broker or loan officer without an active 

license or being exempt under [Chapter 156].” Id. Because this is the conduct by which 

the claimant is aggrieved, we conclude that to be an aggrieved person under section 

156.406(b), the claimant must have paid all or part of the fee or profit to the unlicensed 

mortgage broker or loan officer. 

This construction is supported by a sister court of appeals’s construction of a 

 

2 Effective September 1, 2011, the Texas Legislature amended this section by deleting “mortgage broker 

or loan officer” and replacing that language with “residential mortgage loan originator.” See Act of May 

25, 2011, 82nd Leg., R.S., ch. 655, §§ 37, 68, 2011 Tex. Sess. Law Serv. 1562, 1580, 1589 (codified at 

Tex. Fin. Code Ann. § 156.406(b) (West 2012)). 
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statute containing substantially similar language in the context of commissions paid to an 

unlicensed real estate broker. See Holloman v. Denson, 640 S.W.2d 417, 419–20 (Tex. 

App.—Waco 1982, writ ref’d n.r.e.) (construing predecessor statute to Texas 

Occupations Code section 1101.754(a) (West 2012) (stating that “[a] person who receives 

a commission or other consideration as a result of acting as a broker or salesperson 

without holding a license or certificate of registration under this chapter is liable to an 

aggrieved person for a penalty of not less than the amount of money received or more 

than three times the amount of money received”)). In Hollomon the Tenth Court of 

Appeals construed a statute providing that a person who received a commission for acting 

as a real estate broker and who did not have the required license was liable to “an 

aggrieved person” in an amount not less than the amount of the commission and not more 

than three times this amount, as determined by the trial court. See Holloman, 640 S.W.2d 

at 419–20. The Holloman court held that the evidence was legally insufficient to support 

a finding that the plaintiffs were aggrieved persons in a transaction in which the plaintiffs 

did not pay any part of the unlicensed real estate broker’s commission. See id. at 420. 

As to this transaction, the Holloman court held, the man who paid the commission was 

the aggrieved person, and the plaintiffs were not aggrieved persons as a matter of law. 

See id. 

In another part of its opinion, the Hollomon court held that the plaintiffs were 

aggrieved persons as to another transaction in which the plaintiffs paid the unlicensed 

broker’s commission. See id. The Holloman court rejected the broker’s contention that 

he should not be liable because there was no complaint about the quality of the services 

that he had rendered. See id. According to the Holloman court, the purpose of the statute 

was to penalize persons who acted as real estate brokers without a license. See id. The 

Holloman court concluded that under the statute, a person was aggrieved by paying a 

commission to a real estate broker who did not have a required license, rather than by 

deficiencies in the services rendered by the broker. See id. 

In this appeal, the Bank argues that this court should be guided by the following 

definition of “aggrieved party” or “person aggrieved”: “[a] party entitled to a remedy; 
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esp., a party whose personal, pecuniary, or property rights have been adversely affected 

by another person’s actions or by a court’s decree or judgment.” BLACK’S LAW 

DICTIONARY 1232 (9th ed. 2009). This definition supports this court’s construction of 

section 156.406(b), under which (1) an “aggrieved person” is a person entitled to the 

remedy of damages in an amount that is not less than the amount of the fee or profit 

received and not to exceed three times the amount of the fee or profit received; and (2) an 

“aggrieved person” is a person whose rights have been adversely affected by the 

mortgage broker or loan officer’s receipt of a fee or profit as compensation for services 

that the broker or officer was not legally permitted to perform given the absence of a 

required license. The term “aggrieved person” may be used in many contexts, and its 

meaning may be shaped by the action through which the person is aggrieved and the 

remedy provided to the person aggrieved in this manner. 

The Bank asserts that the plain meaning of “aggrieved person” includes “any 

person who has suffered, or will suffer, injury.” We disagree that this term has such a 

broad meaning in the context of section 156.406(b). As discussed above, the statute 

specifies the conduct by which the person is aggrieved and the remedy provided to the 

aggrieved person. The Bank cites Texas Property Code section 301.003(1) (West 2012) 

(defining “Aggrieved person” to include “any person who (A) claims to have been 

injured by a discriminatory housing practice; or (B) believes that the person will be 

injured by a discriminatory housing practice that is about to occur”). This section of the 

Property Code does not apply to the case under review and does not support the broad 

definition of “aggrieved person” proposed by the Bank.

The Bank also cites a line of cases addressing who has standing to seek judicial 

review of administrative actions. See, e.g., Scott v. Board of Adjustment, 405 S.W.2d 55, 

56 (Tex. 1966) (stating that “[w]here the statute requires that the person be interested, 

affected, or aggrieved, or (in the absence of a statute) where the common law rule 

requiring the showing of particular injury or damage is controlling, the plaintiff must 

allege and show how he has been injured or damaged other than as a member of the 
9

general public in order to enjoin the actions of a governmental body”). These cases deal 

with persons aggrieved by administrative actions and the remedy of judicial review. See 

id. Because of the significantly different context in which the term is used, we do not 

find these cases to be particularly helpful in construing section 156.406(b).3

For the foregoing reasons, we conclude that to be an aggrieved person under 

section 156.406(b), the claimant must have paid all or part of the fee or profit to the 

unlicensed mortgage broker or loan officer. The trial court apparently construed the 

statute in the same manner given that the trial court found the Bank was an aggrieved 

person because it paid Dohalick’s fee. We now address this finding.

B. Is the evidence legally sufficient to support the trial court’s finding that the 

Bank paid the mortgage broker’s fee?

Though there was some evidence at trial indicating that Savoy paid Dohalick’s fee 

without using proceeds from the Loan, there was legally sufficient evidence to support a 

finding that on October 19, 2007, Savoy paid Dohalick the $50,000 fee by using some of 

the loan proceeds that Savoy had received from the Bank the day before. But, the record 

contains no evidence that the Bank paid any part of Dohalick’s fee directly with its own 

money. There is a significant difference between a bank paying a fee to a broker and a 

bank lending money under a promissory note to a borrower who then uses the loan 

proceeds to pay the broker a fee. In the former scenario, the bank pays the fee. In the 

latter scenario, even though the borrower uses loan proceeds obtained from the bank, the 

borrower, not the bank, pays the fee to the broker.

The Bank argues that the evidence is legally sufficient to support the trial court’s 

finding that the Bank paid Dohalick’s fee based upon evidence that:

Dohalick asked the Bank to pay his fee.

The Bank refused to pay Dohalick’s fee and stated that it did not fund loans for the 

 

3 The Bank also argues that the term “aggrieved person” should not be construed to be limited only to 

persons who satisfy the definition of “mortgage applicant.” We agree that this term is not so limited, but 

this conclusion does not mandate acceptance of the Bank’s proffered definition of “aggrieved person.”
10

purpose of paying broker’s fees.

Savoy, Dohalick’s client, tried to figure out how to pay Dohalick’s fee by duping 

the Bank into paying the fee.

Duncan asked an employee of the Bank whether he could inflate “soft costs” in a 

request for an advance under the Loan in order to improperly use the funds to pay 

Dohalick’s fee.

Duncan then submitted a request for an advance in the amount of $65,000 for “soft 

costs” stating explicitly that the money was sought to “take care of Jerry 

[Dohalick].” 

A vice president of the Bank testified that Dohalick’s fee would not be paid by the 

Bank and that he did not authorize payment of Dohalick’s fee. 

Savoy paid Dohalick’s fee one day after the Bank sent funds to Savoy in 

connection with Savoy’s request for an advance to “take care of Jerry.”

Presuming for the sake of argument that the evidence supports each of the foregoing

statements, under the familiar legal-sufficiency standard of review, this evidence would 

not enable reasonable and fair-minded people to find that the Bank paid Dohalick’s fee. 

Even if Savoy breached its loan agreement in requesting the $65,000 advance and even if

Savoy, Duncan, and Dohalick committed fraud in inducing the Bank to make this 

advance, this conduct is not relevant to a damage claim under section 156.406(b), and 

this conduct would not mean that the Bank paid Dohalick’s fee. Though such conduct 

might support various claims by the Bank against Dohalick other than a claim under 

section 156.406(b), the Bank nonsuited and elected not to pursue such claims. 

The Bank argues that the record contains evidence that Savoy “did not pay 

Dohalick’s fee from its own funds.” But the evidence cited by the Bank shows that 

Savoy used proceeds from the Loan to pay Dohalick’s fee. The Bank overlooks the fact 

that, once it advanced funds under the Loan to Savoy, the funds were Savoy’s funds.4 

See In re Sacramento Real Estate Corp., 201 B.R. 225, 229–30, 233 (Bankr. N.D. Ill. 

1996) (holding that debtor, not bank, paid the property-tax redemption amount, even 

 

4 The record contains no evidence that Savoy was required by the Bank to use some or all of the $65,000 

in loan proceeds to pay Dohalick’s fee. Even if there were such evidence, Savoy still would be using its 

money to pay Dohalick’s fee, and Savoy, not the Bank, would be paying the fee.
11

though debtor paid this amount using proceeds of loan from the bank). Considering the 

evidence in the light most favorable to the finding, indulging every reasonable inference 

that would support it, crediting favorable evidence if a reasonable factfinder could, and 

disregarding contrary evidence unless a reasonable factfinder could not, the trial evidence 

would not enable reasonable and fair-minded people to find that the Bank paid all or any 

part of Dohalick’s fee. See City of Keller, 168 S.W.3d at 823, 827. Therefore, the 

evidence is legally insufficient to support the trial court’s finding that the Bank paid 

Dohalick’s fee or to support a finding that the Bank paid any part of this fee. See id. 

V. CONCLUSION

For the purposes of our analysis, we have presumed, without deciding, that (1) the 

Loan was a “mortgage loan” as defined in section 156.002; (2) Dohalick acted as a 

“mortgage broker” as defined in section 156.002; and (3) Dohalick received the $50,000 

fee because of or in consequence of Dohalick’s acting as a mortgage broker without an 

active license and without being exempt under Chapter 156. But, even operating under 

these presumptions, the trial court could not award the Bank damages under section 

156.406(b) unless the Bank paid all or part of Dohalick’s fee. Though the trial court 

found that the Bank paid all of this fee, the trial evidence is legally insufficient to support 

this finding or to support a finding that the Bank paid any part of Dohalick’s fee. 

Because the evidence is legally insufficient to show that the Bank is an “aggrieved 

person,” the Bank cannot recover under section 156.406(b). Though the Bank may have 

been aggrieved by Savoy’s failure to pay its debt to the Bank under the loan documents 

or by Savoy’s failure to pay the Bank’s judgment against Savoy, the Bank was not 

aggrieved by (1) Dohalick’s failure to obtain the license necessary for him to perform 

services for Savoy as a mortgage broker or (2) Savoy’s payment of the fee that Dohalick 

charged Savoy for acting as a mortgage broker without an active license or an applicable 

exemption. Accordingly, we sustain Dohalick’s first issue, reverse the trial court’s 

judgment to the extent that the trial court rendered judgment against Dohalick, and we 
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render judgment that the Bank take nothing against Dohalick.5

/s/ Kem Thompson Frost

Justice

Panel consists of Justices Frost, Seymore, and Jamison.

 

5 We need not and do not address Dohalick’s second, third, and fourth issues.