NUMBER 13-12-00100-CV

COURT OF APPEALS

THIRTEENTH DISTRICT OF TEXAS

CORPUS CHRISTI – EDINBURG

SAMUEL CREGO, Appellant,

 

v.

GUILLERMO LASH &

JOHN HOYSICK, Appellees.

On appeal from the 404th District Court of 

Cameron County, Texas.

MEMORANDUM OPINION ON REHEARING

Before Justices Rodriguez, Garza and Perkes 

Memorandum Opinion by Justice Garza

We issued our original memorandum opinion in this case on December 19, 2013. 

Appellant Samuel Crego filed a motion for rehearing. See TEX. R. APP. P. 49.1. Appellees 

Guillermo Lash and John Hoysick filed a response to the motion. We deny the motion for

rehearing, withdraw our previous memorandum opinion and judgment, and substitute the 
2

following memorandum opinion and judgment in their place. 

This case involves loans between acquaintances to finance a failed real estate 

venture. A jury found that Crego breached two separate loan agreements: one, a 

promissory note with Lash, and two, an unwritten agreement with Hoysick. After the jury 

awarded damages and attorneys’ fees, the trial court rendered judgment against Crego 

in favor of Lash for $52,584.25 and in favor of Hoysick for $50,000.00. The trial court 

also awarded appellees $33,745.00 in attorneys’ fees plus costs, post-judgment interest,

and conditional appellate attorneys’ fees. By four issues, Crego argues that: (1) the trial 

court erred by conditioning his right to appeal on the posting of a bond in the amount of 

the judgment; (2) Lash and Hoysick’s claims were barred by limitations; (3) alternatively, 

the trial court erred in refusing to submit the limitations issue to the jury; and (4) if either 

damage award is reversed, the attorneys’ fees award should be reversed and remanded. 

We affirm. 

I. BACKGROUND

Crego, Lash, Hoysick, Ralph Burks, and Carlos Sarmiento met through their 

employment with Trico in Brownsville, Texas. In March 2004, Crego and Burks formed a 

management company, Crego and Burks Management Group, LLC (“the management 

company”), for the purpose of developing and managing real estate ventures.1 

On July 1, 2004, Lash loaned Crego and Burks $80,000. The loan was evidenced 

by a promissory note, which provided for repayment in monthly installments over six 

months, with the final payment due January 1, 2005. The note was secured by real 

property located in Harlingen, Texas. Under the note, for the first six months, interest 

 

1 Crego testified that “Crego and Burks Management Group, LLC” was later renamed Westgate 

Village Homes, LLC. 
3

was 3.3% per month on the first $50,000 and 1.6% on the remaining $30,000. The total 

principal and interest due on January 1, 2005 was $93,000. 

It is undisputed that the loan was not repaid in January 2005. An invoice dated 

July 18, 2006 was admitted at trial. The invoice, from Lash to the management company, 

states that it is for the “[i]nvestment [l]oan on 7/1/05.”2 It further states, “Principal amount: 

$80,000.00 @ 14% per annum simple interest” and “Balloon Date 6/31/06.” The “Amount” 

column shows $80,000.00 plus $11,200.00 in interest, for a total of $91,200.00. Crego 

testified that the $91,200.00 amount “was an agreed upon amount” between himself, 

Burks, and Lash. Crego testified that Lash was paid the $91,200.00 on October 31, 2006. 

Crego admitted that the amount repaid to Lash was less than the amount due under the 

terms of the note, but stated that Lash agreed to the amount in a “spirit of cooperation.” 

In August 2004, Hoysick and Sarmiento each provided the management company 

with $50,000 to facilitate the purchase and resale or development of an eight-acre 

property in Weslaco, Texas known as “Westgate Loop.”3 The terms of these transactions 

were not reduced to writing. It is undisputed that the $100,000 was used as “collateral” 

for a $575,000 bank loan to the management company for the purchase and development 

of Westgate Loop. According to Crego, the unwritten agreement was that Burks, Hoysick, 

and Sarmiento would each receive 22.5% of the profits from the resale or development 

project, with Crego receiving 32.5% of the profits. Crego testified that eight months later, 

around April 2005, the bank loaned the management company $425,000 to purchase the 

Westgate Loop property. Six or eight months after that, Sarmiento decided to withdraw 

 

2 Crego admitted that July 1, 2005 was a year later than the actual date of the loan, July 1, 2004. 

3 Crego denies that these funds were loans; rather, he contends they were “investments” in the 

development project. Crego testified that there was no date certain when Hoysick would receive a return 

on his $50,000.
4

from the venture. Crego testified that he returned Sarmiento’s $50,000. The three 

remaining parties agreed to split the profits with each receiving thirty percent, and Crego 

receiving an additional ten percent. 

Sarmiento testified that he loaned the management company $50,000. According 

to Sarmiento, the parties agreed that these funds, along with the $50,000 loaned by 

Hoysick, would remain untouched at the bank, the land would be resold at a substantial 

profit, and each would receive twenty-five percent of the profit from the resale. The 

agreed-upon interest on the loan was a percentage of profits upon resale. Later, after 

Crego began working for the management company full time, the percentage of profit 

changed to twenty percent each for Sarmiento, Lash, and Burks, and forty percent for 

Crego. Crego told Sarmiento that he expected to “flip” the property quickly because 

another buyer had already made an offer. After the management company turned down 

several offers and decided to develop the property, Sarmiento decided to withdraw from 

the venture and asked for the return of his $50,000. Over the course of two years, 

Sarmiento was repaid the $50,000, but was not repaid any interest. Sarmiento testified 

that when the plans changed from resale to development of the property, he felt that he 

was being invited to invest and decided not to do so. 

Hoysick testified that he loaned the management company $50,000 in August 

2004. The agreement was that when the property was resold, he would receive his 

$50,000 plus a percentage of the profits from the resale. Initially, the percentage of profit 

was twenty-five percent; later, the percentage changed to twenty-two-and-a-half percent, 

and still later, to twenty percent. Hoysick stated that he suggested to Crego that he also 

wanted to withdraw, but Crego said he did not have the funds to repay him. Crego told 

Hoysick that if he withdrew, he would not retain any interest in the project. Hoysick said 
5

that Crego offered to pay him fourteen percent interest on repayment of the $50,000 if 

Hoysick withdrew. Hoysick was not ever repaid any amount. In January 2007, Crego 

told Hoysick that the bank had released the funds held in security. Hoysick gave Crego 

a transfer account number, but Crego refused to provide any repayment. Crego told 

Hoysick that the funds were used for other management company projects. Hoysick 

stated that he did not invest in Westgate Loop and did not know that his money was at 

risk. 

On cross-examination, Hoysick was asked about a July 9, 2006 email that he sent 

to Crego in which he asked “to discuss the status of the apartment project” and “to review 

something in writing to document my relationship/investment with Crego and Burks.” 

Hoysick stated that if he wanted out of the project, “there was one set of terms,” but if the 

land sold or apartments were built, he would receive his original $50,000 plus a 

percentage of the profits. He stated that “[t]here was no specific date” when his money 

was to be returned; he would be repaid when either the land was sold or the apartment 

complex was built and sold. Hoysick expected to receive the return of his $50,000 plus 

a percentage of the profits within six months. If he withdrew from the project, he would 

not receive any profit, but would still receive fourteen percent interest on the loan. Hoysick 

stated that in January 2007, when the bank released the collateral funds, he should have 

been repaid. 

In July 2007, Hoysick sent Crego an email in which he inquired about: (1) the 

“status of the subject project”; (2) the “status of bringing in additional investor(s)”; and (3) 

the “status of returning [his] initial $50k as originally agreed upon and now 6 months past 

due.” 

After the recession in 2008, Crego was unable to obtain refinancing from the bank 
6

for the development. Eventually, he sold the property for the amount owed to the bank, 

approximately $520,000. Crego did not tell Hoysick when he sold the property. 

Eventually, in August 2009, Hoysick learned that the property had been sold when Burks 

filed for bankruptcy. 

Lash testified that he loaned the management company $80,000 in July 2004. The 

repayment date on the loan was January 1, 2005. Lash testified that Crego drafted the 

promissory note. The note sets forth interest in the amount of $2,166.67 per month. 

When the note became due in January 2005, Crego said he was unable to repay the note. 

Crego repaid Lash $91,200 twenty-seven months later. Lash stated that the invoice 

showing “investment/loan” on July 1, 2005 was prepared by Crego, and the actual date 

of the loan was July 2004. 

Lash testified that he loaned Crego an additional $50,000 in January 2006.4 Lash 

made the second loan, even though he had not been repaid for the first, because he 

believed that if the management company failed, he may “lose everything.” At the time 

of the second loan, Lash and Crego agreed that interest on the remaining balance of the 

$80,000 would be fourteen percent. Lash learned that Burks had left the management 

company when he received notice of Burks’s bankruptcy filing. 

Lash stated that Crego gave him the invoice and the $91,200 payment in 

November 2006. Lash stated that he asked for the rest of what he was owed, but Crego 

said he would have to wait for the rest of the money. Lash said the fourteen percent 

reflected on the invoice came from Crego and they did not discuss it. 

II. POSTING OF BOND

 

4 The jury did not find that Lash made the $50,000 loan, and it is not at issue in this appeal. 
7

By his first issue, Crego contends the trial court erred by including language in the 

judgment conditioning the appeal on Crego posting a bond in the amount of the judgment. 

Appellees respond that: (1) Crego failed to preserve any issue because he did not object 

to the judgment or move to modify it; and (2) the bond provision should be construed to 

set the amount of any supersedeas bond under section 52.006 of the civil practice and 

remedies code. See TEX. CIV. PRAC. & REM. CODE ANN. § 52.006 (West 2008); TEX. R.

APP. P. 24. 

In January 2013, this Court denied Crego’s motion to review the trial court’s order 

conditioning the appeal on the posting of a bond. In our January 11, 2013 order, we 

rejected Crego’s argument that the trial court intended the subject bond to be a 

supersedeas bond. 

In any event, we conclude that the issue is now moot. Crego has not posted a 

bond and has not been prevented from appealing the judgment. Appellees have not 

requested dismissal of the appeal. We overrule Crego’s first issue. 

III. LIMITATIONS 

By his second issue, Crego contends that Lash’s and Hoysick’s claims accrued 

more than four years prior to their filing of the lawsuit and are therefore barred by 

limitations. See TEX. CIV. PRAC. & REM. CODE ANN. § 16.035(e) (West 2002) (providing 

that, if a note payable in installments is secured by a real property lien, the four-year 

limitations period begins to run on maturity date of last installment). Appellees respond 

that their claims are not barred by limitations because the claims are governed by the six-
8

year statute of limitations pursuant to section 3.118 of the Texas Business and Commerce 

Code. See TEX. BUS. & COM. CODE ANN. § 3.118 (West 2002).5

The statute of limitations is an affirmative defense, and a defendant bears the 

burden to plead, prove, and secure findings to support its affirmative defense. Holland v. 

Lovelace, 352 S.W.3d 777, 788 (Tex. App.—Dallas 2011, pet. denied). This burden 

includes establishing when the plaintiff’s cause of action accrued. Id. If the jury is not 

asked to determine when the cause of action accrued for purposes of supporting a 

limitations defense, the defense is waived unless the date of accrual was conclusively 

established under the evidence. Id. Here, Crego did not obtain jury findings regarding 

the accrual dates for Lash’s and Hoysick’s claims. See id. Consequently, Crego must 

demonstrate that the accrual dates of Lash’s and Hoysick’s claims were conclusively 

established. See id. If the accrual dates were not conclusively established under the 

evidence, then Crego’s limitations defense is waived. See id. Generally, a cause of 

action for breach of contract accrues upon breach. Barker v. Eckman, 213 S.W.3d 306, 

311 (Tex. 2006). 

In our review, we consider the evidence in the light most favorable to the ruling 

and indulge every inference that would support it. Id. (citing City of Keller v. Wilson, 168 

 

5

In his reply brief, Crego argues that Lash should not be permitted to argue on appeal that the sixyear statute of limitations applies because he failed to make this argument to the trial court. We disagree. 

Our review of the record shows that the statute of limitations issue was raised only very briefly at trial, 

without argument or citation to any statute, and without reference to a four-year or six-year limitations 

period. After the close of evidence, during a discussion of the jury charge, the trial court denied Crego’s 

request for a jury question on the statute of frauds. Crego’s counsel then stated, “[t]hen if it is performable 

within one year, then—then I think we have a statute of limitations argument, because all these agreements 

were entered into in 2004, 2005 and 2006.” The trial court rejected the argument, stating that the statute 

of limitations begins to run only when a plaintiff conclusively knows that an agreement has been breached. 

Apparently referring to when Lash learned of the sale of the property, the trial court said, “When they found 

out that this land is sold and we didn’t even know about it, I mean, there’s a lot of variables to that, so—.” 

The only other reference in the reporter’s record is when Crego’s counsel briefly recites the jury questions 

that he requested and the trial court denied. He characterizes some of those questions as involving the 

“statute of limitations” regarding various causes of action. 
9

S.W.3d 802, 822 (Tex. 2005)). We review all the evidence and must credit the favorable 

evidence if reasonable jurors could and disregard the contrary evidence unless 

reasonable jurors could not. Id. (citing City of Keller, 168 S.W.3d at 827).

A. Lash’s Claim

Lash recovered under the $80,000 promissory note made on July 1, 2004. The 

loan was secured by real property. It is undisputed that the note was not paid by its 

maturity date, January 1, 2005. He filed suit on May 28, 2010. 

Crego argues that Lash’s claim for breach of a loan agreement is governed by the 

four-year statute of limitations. See TEX. CIV. PRAC. & REM. CODE ANN. §§ 16.004(a)(3) 

(West 2002) (setting forth four-year limitations period for actions on debt), 16.035(e). 

Lash argues that, because he sued only to enforce payment on the promissory note, and 

not for foreclosure on the real property securing the note, his claim is governed by the 

six-year statute of limitations set forth in section 3.118 of the Texas Business and 

Commerce Code. See TEX. BUS. & COMM. CODE ANN. § 3.118 (stating generally that “an 

action to enforce the obligation of a party to pay a note payable at a definite time” must 

be brought within six years of the due date).

This Court addressed this issue in Aguero v. Ramirez, 70 S.W.3d 372, 375 (Tex. 

App.—Corpus Christi 2002, pet. denied). In that case, the plaintiff, Ramirez, sued Aguero 

to enforce payment of unpaid principal and interest on a real estate note secured by a 

deed of trust and a vendor’s lien on real property. See id. at 373. We found that, “[w]here 

there is a debt secured by a note, which is, in turn, secured by a lien, the note and lien 

constitute separate obligations.” Id. at 374. We held that, because Ramirez was “only 

suing to enforce payment on the promissory note,” and was not suing to enforce the lien, 

the deed of trust, or seeking to foreclose on the real property, his claim was “an action to 
10

enforce the obligation of a party to pay a note payable at a definite time” under the 

business and commerce code, and therefore, the six-year statute of limitations was 

applicable. Id. at 375; see TEX. BUS. & COM. CODE ANN. § 3.118; see also Arlington v. 

McClure, No. 02-06-296-CV, 2008 WL 755072, at *6 (Tex. App.—Fort Worth June 5, 

2008, no pet.) (mem. op.). Here, Lash’s $80,000 promissory note is a “note” within the 

meaning of the business and commerce code because it is “an unconditional promise or 

order to pay a fixed amount of money, with or without interest or other charges described 

in the promise or order” and is payable at a definite time. TEX. BUS. & COM. CODE ANN. § 

3.104(a)(2), (e) (West 2002). It is a “promise” because it is “a written undertaking to pay 

money signed by the person undertaking to pay.” Id. § 3.103(a)(12) (West Supp. 2011). 

The promissory note’s maturity date is January 1, 2005. Lash’s suit was filed May 28, 

2010, within the six-year limitations period. We conclude that Crego did not establish that 

Lash’s claim is barred by limitations and overrule Crego’s second issue as it applies to 

Lash.

B. Hoysick’s Claim 

Hoysick’s $50,000 loan to the management company was evidenced by his check 

dated August 9, 2004. There was no written agreement regarding repayment provisions. 

Section 3.118 of the business and commerce code is not applicable to unwritten loan 

agreements. See id. §§ 3.103(a)(12), 3.104(e) (defining “promise” as a written 

undertaking to pay money and defining “note” as a promise). Accordingly, we conclude 

that the applicable statute of limitations is the four-year statute of limitations for a suit to 

collect a debt. See TEX. CIV. PRAC. & REM. CODE ANN. § 16.004(a)(3).

As noted, Crego’s limitations defense is waived unless the evidence conclusively 

established the date that Hoysick’s loan agreement was breached. See Holland, 352 
11

S.W.3d at 788; Barker, 213 S.W.3d at 311. Crego argues that because there was no 

specific time to repay the loan, it was a demand note and the statute of limitations ran 

from the date the note was executed. According to Crego, limitations expired in August 

2008, long before the filing of Hoysick’s suit in May 2010. In support, Crego relies on 

Manandhar v. Jamshed. No. 02-11-00027-CV, 2011 WL 3835980, at *3 (Tex. App.—Fort 

Worth Aug. 31, 2011, no pet.) (mem. op.). In Manandhar, the Fort Worth Court of Appeals 

concluded that a document signed by the appellee/debtor acknowledging a $126,000 loan 

from the appellant was a demand note because the note did not specify a time for 

repayment. Id. 

In general, a loan agreement which contains no time for repayment is payable on 

demand. Nat’l Mar-Kit, Inc. v. Forrest, 687 S.W.2d 457, 460 (Tex. App.—Houston [14th 

Dist.] 1985, no writ). The statute of limitations begins to run on a demand note on the 

date of making, unless demand is a condition precedent to suit on the note, in which case 

limitations begin to run on the date of demand. Loomis v. Republic Nat’l Bank of Dallas, 

653 S.W.2d 75, 77 (Tex. App.—Dallas 1983, writ ref’d n.r.e.). 

Here, however, we conclude that Hoysick’s loan was not a demand loan because 

the evidence established that, although there was no date certain that Hoysick would 

receive repayment of his $50,000, the parties agreed that he would receive repayment 

when the Westgate Loop property was resold or when the bank released the funds held 

in security. Because repayment was tied to specific events—resale of the property or 

release of the funds—Hoysick’s loan was not a demand loan. See Fin. Freedom Sr. 

Funding Corp. v. Horrocks, 294 S.W.3d 749, 754 (Tex. App.—Houston [14th Dist.] 2009, 

no pet.) (holding notes were not demand notes because they contained conditions which 

created a readily ascertainable time for payment); Maceo v. Doig, 558 S.W.2d 117, 120 
12

(Tex. Civ. App.—Austin 1977, writ ref’d n.r.e.) (holding oral promise to pay “in the 

summer” was sufficiently definite to support a finding of a binding extension of time for 

payment of a promissory note). 

Hoysick testified that in exchange for his $50,000 loan, he was to receive the return 

of his $50,000 plus twenty-five percent of the profit when the Westgate Loop property was 

sold. Crego later reduced the percentage of profit due to Hoysick to twenty-two-and-ahalf percent and later, to twenty percent. When asked at trial to identify the date his 

money was to be returned, Hoysick responded, “It was based on when the land sold, (A), 

or once the apartment complex was built and sold, (B). There was no specific date of 

when it would happen.” If Hoysick withdrew from the project, he would not receive any 

percentage of the profit, but would receive fourteen percent interest on the loan. 

According to Hoysick, “the agreement was [he] could get out at any time.” Hoysick was 

asked, “So there’s no due date on your loan agreement. There was no exact date that 

the money was supposed to be paid back?” He responded, “Well, on the other hand, 

yes. Again, when the bank freed up the $50,000.00, which did happen in January of ’07, 

when the bank freed up that money, I was supposed to receive it back.” Crego informed 

Hoysick in January 2007 that the bank had released the $50,000. Hoysick requested the 

return of his money, but Crego refused. 

Crego argues that the loan agreement was breached when Hoysick told Crego 

that he wanted to withdraw from the project. Assuming, without deciding, that the 

agreement was breached at that time, we find conflicting evidence regarding when that 

occurred. It is undisputed that Hoysick told Crego that he wanted to withdraw from the 

project after Sarmiento withdrew from the project. Sarmiento testified that he withdrew 
13

from the project and asked for the return of his money in 2007. Hoysick testified as 

follows:

Q [Crego’s counsel]: And I think you said later on down the road you 

wanted out and you told Mr. Sarmiento, you called 

him and asked him what his thoughts were.

A [Hoysick]: Correct.

Q: When was that?

A: Approximately, I would say, about a year later, 

roughly.

Q: Give or take in 2005, more or less?

A: A year, year and a half later. 

Crego testified that Sarmiento asked for the return of his money around November 2005 

or “a little bit after that.” When asked if there was a date certain that Hoysick was 

supposed to get his money back, Crego said, “No. The only thing that was mentioned 

was if we were able to refinance and cash out, then some money would have been—

have gone back to him, but we weren’t allowed to.” Even if we were to assume that the 

agreement was breached when Hoysick asked to withdraw from the project, the date of 

the breach is not conclusively established and Crego’s limitations defense is waived 

insofar as it is based on Hoysick’s withdrawal from the project. See Holland, 352 S.W.3d 

at 788. 

We conclude that Crego breached the agreement either in January 2007 when the 

bank released the money and Hoysick demanded repayment or in 2008 when the 

Westgate Loop property was sold. Because Hoysick filed suit on May 28, 2010, we 

conclude that it was within the four-year limitations period. We overrule Crego’s second 

issue as it applies to Hoysick. 
14

IV. JURY QUESTION

Alternatively, by his third issue, Crego argues that, to the extent there were 

disputed fact issues regarding when the loan agreement was breached, the trial court 

erred in refusing to submit questions on limitations to the jury. Specifically, Crego 

contends that the trial court erred in refusing to submit the following jury question 

regarding the loan agreement with Hoysick:

As to the money you found was borrowed in the loan agreement you found 

in answer to Question No. ____, state the date on which it was loaned?

Answer by giving one of these four types of answer: (a) stating a month, 

date, and a year, or (b) stating “no due date,” or (c) stating “on demand” or 

(d) stating “depending upon a future occurrence.”

Answer:_____________

Crego argues that although the question and instruction were “not perfect,” they were 

“substantially correct” and were sufficient to put the trial court on notice that Crego was 

asserting a limitations bar. See TEX. R. CIV. P. 278 (stating that a failure to submit a jury 

question shall not be grounds for reversal unless the complaining party tendered it in 

writing in substantially correct wording to the trial court). As noted above, the discussion 

at the charge conference reflects that the trial court was aware that Crego raised the issue 

of limitations, and the trial court rejected the argument. Crego argues that the question 

was “substantially correct,” although we note that it asked the jury to determine when the 

money was loaned, not when the loan agreement was breached. “The omission of an 

instruction is reversible error only if the omission probably caused the rendition of an 

improper judgment.” Shupe v. Lingafelter, 192 S.W.3d 577, 579 (Tex. 2006). We have 

already determined that Hoysick’s claim was not barred by limitations because the loan 

agreement was breached either in January 2007 when the bank released the funds or in 
15

2008 when the Westgate Loop property was sold. The trial court’s failure to submit a jury 

question regarding when Hoysick made the loan could not have caused the rendition of 

an improper judgment. See id. 

We overrule Crego’s third issue. 

V. ATTORNEY’S FEES 

By his fourth issue, Crego argues that if we reduce the damage award to either 

Lash or Hoysick, we should remand the attorney’s fees issue for recalculation. Because 

we have not reversed or reduced either damage award, we need not address this issue. 

We overrule Crego’s fourth issue. 

VI. CONCLUSION

We affirm the trial court’s judgment. 

DORI CONTRERAS GARZA,

Justice

Delivered and filed the

27th day of March, 2014.