In the

Court of Appeals

Second Appellate District of Texas

at Fort Worth ___________________________

No. 02-21-00333-CV

___________________________

On Appeal from the 236th District Court

Tarrant County, Texas

Trial Court No. 236-302212-18

Before Kerr, Bassel, and Walker, JJ. 

Memorandum Opinion by Justice Bassel

1701 COMMERCE ACQUISITION, LLC, Appellant

V. 

MACQUARIE US TRADING, LLC, Appellee
2

MEMORANDUM OPINION

I. Introduction

Appellant 1701 Commerce Acquisition, LLC sued its lender, Appellee

Macquarie US Trading, LLC, after Macquarie declared two events of default on 

Appellant’s loan and began charging Appellant a default rate of interest. In two issues

with multiple subparts, Appellant challenges (1) the trial court’s final judgment that 

incorporated a prior summary-judgment ruling and that decreed that Appellant

recover nothing on its suit and (2) a ruling on a motion to determine fees by which 

the trial court awarded approximately $1.5 million in attorneys’ fees to Macquarie. We 

overrule the issues surrounding the defaults or do not reach them. We sustain 

Appellant’s issue challenging Macquarie’s recovery of attorneys’ fees.

At the outset, we hold that Macquarie did not breach the terms of its loan 

agreement with Appellant or a duty of good faith and fair dealing under New York

law when Macquarie declared a default based on Appellant’s failure to obtain

Macquarie’s written consent before a subordinate mezzanine loan was prepaid. This 

holding obviates a need to discuss (1) the propriety of a second alleged default 

declared by Macquarie that resulted from Appellant’s exercise of a parking-lot option

and (2) the soundness of the evidence presented by Appellant to support a damage

claim predicated on Macquarie’s public disclosure that the loan was in default—an 

action that Appellant claimed devalued the property securing the loan. Next, we hold 

that Appellant has not adequately briefed the issue of whether Macquarie “consented”
3

to prepayment of the mezzanine loan and thus waived appellate review of that issue. 

But we do sustain one issue that Appellant raises on appeal: the loan agreement 

between the parties does not contain a provision that entitles Macquarie to recover its 

attorneys’ fees and expenses in this litigation from Appellant. Accordingly, we affirm

the portion of the trial court’s summary judgment that Appellant take nothing on its 

claims against Macquarie, and we reverse the portion of the trial court’s judgment 

awarding Macquarie its fees and expenses and render judgment that Macquarie take 

nothing on its fee claim.

II. Factual and Procedural Background

A. Factual Background

1. The ownership and debt structure of Appellant

The president of Appellant is Sushil Patel, and much of the evidence that 

Appellant relies on was presented through his affidavit that was filed as part of 

Appellant’s summary-judgment evidence and through his deposition. Appellant owns 

a Sheraton Hotel located in downtown Fort Worth. Appellant purchased the hotel 

out of a bankruptcy proceeding. According to Mr. Patel’s affidavit, he had indirectly 

owned the hotel through another entity before the bankruptcy, and in the bankruptcy 

proceeding, the hotel was surrendered to a secured creditor in lieu of foreclosure.

The financing structure for the purchase of the hotel by Appellant involved

two tiered loans: (1) a $35 million senior loan (Macquarie’s Loan) made by Macquarie

to Appellant; and (2) a $21 million junior loan (the Mezzanine Loan) made by DOF 
4

IV Reit Holdings, LLC (which the parties refer to as Torchlight and which we will 

refer to as the Mezzanine Lender) to 1701 Mezzco One LLC, which is apparently 

Appellant’s parent. Both loans were governed by lengthy loan agreements; the loan 

agreement governing Macquarie’s Loan spans 129 single-spaced pages of text. (We 

will refer to Macquarie’s loan agreement as the Loan Agreement and the one 

governing the Mezzanine Loan as the Mezzanine Loan Agreement.) In addition to 

the complexities created by its length, the Loan Agreement provides that it is 

governed by New York law, and it is that state’s law that we must apply to interpret its 

provisions. An additional agreement overlays the Loan Agreement and the 

Mezzanine Loan Agreement because the relationship between the two lenders was 

governed by an Intercreditor Agreement, which in essence subordinated the 

Mezzanine Lender to Macquarie’s security interests and gave Macquarie the right of 

first payment.

2. The alleged defaults by Appellant on the Loan Agreement 

that form the core of the parties’ disputes and a summary of 

the controversies arising from those disputes

As noted, the controversy below focused on whether two events constituted 

events of defaults under the Loan Agreement and justified Macquarie’s action of 

charging a default interest rate. The applicable interest rate under the Loan 

Agreement was specified to be 4.828%, but because Macquarie contended that events

of default had occurred, Macquarie began charging a post-default rate that increased

the original interest rate by 5%. The increase in the rate caused Appellant to pay 
5

approximately $1 million in additional interest before it paid off Macquarie’s Loan 

than Appellant would have paid had the interest rate not been increased. Each party 

claims that the other’s actions breached the Loan Agreement.

As to the event of default that Macquarie claimed because of the alleged

prepayment of the Mezzanine Loan without Macquarie’s written consent, this alleged 

default started when the Mezzanine Lender declared its loan in default by asserting 

that Appellant carried a balance of trade payables that exceeded the limits allowed in 

the Mezzanine Loan Agreement. The Mezzanine Lender made a protective advance 

of funds to reduce the trade payables balance below the limit allowed in the 

Mezzanine Loan Agreement and then increased the principal balance of its loan by 

the amount of its advance. The Mezzanine Lender then demanded repayment of the

amount of the advance. When the advance was not paid to the satisfaction of the

Mezzanine Lender, that lender accelerated its debt, declared the entire balance of the

Mezzanine Loan due, and set a date for foreclosure. Appellant challenged the 

propriety of the Mezzanine Lender’s actions. But the fraught state of affairs with the 

Mezzanine Lender caused Appellant to consider paying off the Mezzanine Loan.

The circumstances of the eventual payoff of the Mezzanine Loan—and 

whether those circumstances gave Macquarie the right to declare that an event of 

default had occurred and to charge a default rate of interest—generated most of the 

issues discussed in this opinion. The determination of whether Macquarie acted 

properly or instead breached the Loan Agreement by declaring a default revolves 
6

around questions about (1) the communications between Appellant and Macquarie

about whether Macquarie would consent to the pay off of the Mezzanine Loan,

(2) what entity made the payment to discharge that loan, (3) the status of the loan 

when it was paid and the way in which that discharge was documented, and (4) how 

the Loan Agreement’s terms impact whether its default provisions were triggered by 

the circumstances under which the Mezzanine Loan was discharged.

With respect to the communications regarding the payoff, Appellant argues 

that Macquarie represented that it would consent to the payoff if certain conditions

were met, and Appellant contends that it satisfied those conditions. Macquarie

counters that the communications referenced by Appellant demonstrate that the parties

had engaged only in preliminary discussions and that questions remained that were

never answered about the payoff and how the discharge of the Mezzanine Loan would 

affect Macquarie’s position. Macquarie also highlights that Mr. Patel testified in his 

deposition that Macquarie never consented to a prepayment of the Mezzanine Loan.

With respect to the identity of the party that made the payment to discharge

the Mezzanine Loan, the parties agree that the funds paid to discharge the Mezzanine

Loan were provided by an entity named Vesta Equity, LLC, which is described in the 

parties’ briefing as an indirect owner of the hotel. The impact of Vesta’s making the 

payment triggers a controversy regarding whether the Loan Agreement specified that

only certain parties were prohibited from making a payoff; Vesta was not listed as one 

of those parties.
7

The circumstances of the payment to discharge the Mezzanine Loan trigger 

two subcontroversies. The first is whether the Loan Agreement has language that 

alters the conventional definition of prepayment; Appellant argues that the 

conventional definition was not met if the Mezzanine Loan was accelerated before its

payment. This question is pivotal because the parties also agree that the Mezzanine

Lender had accelerated its debt before it was paid. The second is whether the way the 

discharge of the Mezzanine Loan was documented creates a question regarding

whether that loan was paid off or simply released.

We will only briefly touch on the second default that Macquarie relied on to 

charge a default interest rate. This alleged default resulted from the failure of 

Appellant to obtain Macquarie’s written consent prior to its exercise of an option to

purchase a parking lot. This event of default allegedly occurred after the alleged 

prepayment default that was described above. We will not delve into the facts of this 

default because we hold that the prepayment of the Mezzanine Loan constituted an 

event of default and that the existence of that default independently supports the 

judgment entered by the trial court.

3. The damages that Appellant claimed that it was caused by

Macquarie and the fee recovery that Macquarie obtained

against Appellant

The first measure of damages that Appellant claims resulted from Macquarie’s 

allegedly wrongful declarations of default is straightforward. Appellant seeks to 
8

recover the amount of money it paid Macquarie as default interest, which, as we have 

noted, is approximately $1 million.

The second measure is bottomed in Appellant’s claim that it never defaulted on 

Macquarie’s Loan, but in its efforts to sell that loan, Macquarie publicly claimed that 

Appellant had done so. This damage claim is predicated on Appellant’s contention 

that Macquarie had no right to declare Macquarie’s Loan was in default and thus no 

right to make the public claim that a default had occurred. As Appellant conceded at 

oral argument, this damage claim depends on our conclusion that Appellant did not

default on the Loan Agreement, or if it did, the statements that Macquarie made were

accurate, and a damage claim cannot be predicated on the statements.

On the other side of the ledger, Macquarie claimed that the Loan Agreement 

entitled it to recover its attorneys’ fees and expenses from Appellant in this litigation. 

Appellant disputed that the provision of the Loan Agreement that Macquarie relied

on to support its fee recovery was sufficient under New York law to permit that 

recovery. Because the parties are at loggerheads about the relevant holdings of New 

York cases impacting the question and whether the Loan Agreement has a provision

meeting the criteria for Macquarie to recover its fees, the fee issue is another to which 

this opinion will devote lengthy consideration.
9

B. Procedural background

1. The claims and defenses pleaded by the parties

Appellant initially sued Macquarie, alleging (1) that Appellant was entitled to 

declaratory relief that the payment to the Mezzanine Lender and the exercise of the 

parking-lot option were not events of default, (2) that Macquarie had breached the 

Loan Agreement and the duty of good faith and fair dealing by declaring the payment 

and exercise of the parking-lot option to be events of default, and (3) that the breach 

caused damage to Appellant by requiring payment of default interest and by reducing 

the hotel’s value. Appellant also sought various forms of injunctive relief.

After the suit was filed, the parties reached a partial settlement and executed a

mutual release by which Appellant paid off Macquarie’s Loan but reserved Appellant’s

right to pursue its litigation claims against Macquarie. After execution of the release, 

Appellant amended its petition to delete its claim for injunctive relief. Appellant also 

eventually quantified its damages as the approximately $1 million for the default interest 

collected by Macquarie and the approximately $15 million devaluation of the hotel by

Macquarie’s public statements about Appellant’s alleged defaults that “tainted and 

severely impaired the market perception of [Appellant] and of the [h]otel and negatively 

impacted the terms on which [Appellant] could sell or refinance the [h]otel.”

As the litigation progressed, Macquarie filed counterclaims against Appellant

alleging that prepayment of the Mezzanine Loan and exercise of the parking-lot 

option were breaches of the Loan Agreement. The counterclaim also pleaded for the 
10

recovery of Macquarie’s attorneys’ fees and costs. Appellant answered the counterclaim

and alleged various affirmative defenses, including waiver, estoppel, and quasi-estoppel.

2. The motion practice that eventually resulted in a final 

judgment

Macquarie filed an initial motion for summary judgment, and Appellant filed a 

cross-motion for summary judgment—both of which the trial court denied. 

Macquarie then filed a second motion for summary judgment that resulted in the 

disposition of Appellant’s claims that are on appeal. In essence, Macquarie’s motion 

for summary judgment contended that (1) Appellant breached the Loan Agreement 

when, without Macquarie’s written consent, the Mezzanine Loan was prepaid and the

parking-lot option was exercised; (2) Macquarie had no duty of good faith and fair 

dealing under New York law; (3) no evidence supports Appellant’s claims that 

Macquarie’s actions damaged the value of the hotel; and (4) the claim of damage to the 

value of the hotel was not foreseeable when the Loan Agreement was entered into. 

The trial court granted Macquarie’s motion generally by decreeing that “[a]fter 

considering Macquarie’s [m]otion for [s]ummary [j]udgment, the response, the evidence, 

and the arguments of counsel, the [c]ourt has determined that the [m]otion is

GRANTED.”

After the trial court granted Macquarie’s motion for summary judgment,

Macquarie then filed a motion for determination of its reasonable attorneys’ fees and 

expenses and a motion for judgment. Appellant filed a lengthy objection to 
11

Macquarie’s motion seeking attorneys’ fees. The trial court granted Macquarie’s fee 

motion and awarded it approximately $1.5 million in attorneys’ fees through trial, as 

well as appellate fees. The trial court then signed a final judgment embodying its 

summary-judgment and fee rulings. Appellant filed a notice of appeal and also a first 

and second amended notice of appeal.

III. Analysis

A. We set forth the standards of review that we apply to summary 

judgments and to contract construction.

We review a summary judgment de novo. Travelers Ins. v. Joachim, 315 S.W.3d 

860, 862 (Tex. 2010). We consider the evidence presented in the light most favorable 

to the nonmovant, crediting evidence favorable to the nonmovant if reasonable jurors 

could, and disregarding evidence contrary to the nonmovant unless reasonable jurors 

could not. Mann Frankfort Stein & Lipp Advisors, Inc. v. Fielding, 289 S.W.3d 844, 848 

(Tex. 2009). We indulge every reasonable inference and resolve any doubts in the 

nonmovant’s favor. 20801, Inc. v. Parker, 249 S.W.3d 392, 399 (Tex. 2008). A 

defendant that conclusively negates at least one essential element of a plaintiff’s cause 

of action is entitled to summary judgment on that claim. Frost Nat’l Bank v. Fernandez, 

315 S.W.3d 494, 508 (Tex. 2010); see Tex. R. Civ. P. 166a(b), (c).1

1

Macquarie appears to have raised a no-evidence summary-judgment ground

with respect to Appellant’s devaluation claim. Although we usually address noevidence summary-judgment grounds first, we may address the traditional grounds first 

if that approach is more efficient or if traditional grounds are dispositive in our 

resolution of the appeal. Veros Credit, L.L.C. v. Sur. Bonding Co. of Am., No. 05-19-
12

Because many of the questions before us involve the construction of the Loan 

Agreement, we also set forth the standard of review for construing a contract. “The 

construction of an unambiguous contract is a question of law for the court, which we 

may consider under a de novo standard of review.” Tawes v. Barnes, 340 S.W.3d 419, 

425 (Tex. 2011).

B. We set forth the general principles of New York law that govern 

contract interpretation.

As noted above, the Loan Agreement specifies that it is governed by New York

law, and the parties agree that our interpretation of the Loan Agreement is governed

by that state’s law.

2 The Second Circuit has outlined the guiding principles of contract

interpretation under New York law as follows:3

00586-CV, 2020 WL 2569911, at *4 n.3 (Tex. App.—Dallas May 21, 2020, pet. denied)

(mem. op.); Webb v. Ellis, No. 05-19-00673-CV, 2020 WL 1983358, at *9 (Tex. App.—

Dallas Apr. 27, 2020, pet. dism’d). Here, it is both more efficient to address Macquarie’s 

traditional summary-judgment grounds first and those issues are dispositive.

2

The Loan Agreement provides that

THE NOTE AND THE OTHER LOAN DOCUMENTS AND THE

OBLIGATIONS ARISING HEREUNDER AND THEREUNDER

SHALL BE GOVERNED BY, AND CONSTRUED IN

ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW

YORK APPLICABLE TO CONTRACTS MADE AND 

PERFORMED IN SUCH STATE (WITHOUT REGARD TO 

PRINCIPLES OF CONFLICT OF LAWS) . . . .

3

Throughout the opinion, when a New York case appears within quoted

material, we cite it as it appears in the original quotation even though many of the 

citations do not conform to the Bluebook regarding the reporter that should be cited.
13

When interpreting a contract, our “primary objective . . . is to give effect 

to the intent of the parties as revealed by the language of their 

agreement.” Compagnie Financiere de CIC et de L’Union Europeenne v. Merrill

Lynch, Pierce, Fenner & Smith, Inc., 232 F.3d 153, 157 (2d Cir. 2000). 

“[T]he words and phrases [in a contract] should be given their plain 

meaning, and the contract should be construed so as to give full meaning 

and effect to all of its provisions.” Olin Corp. v. Am. Home Assur. Co., 704 

F.3d 89, 99 (2d Cir. 2012) (internal quotation marks omitted).

Under New York law, a contract is ambiguous if its terms “could 

suggest more than one meaning when viewed objectively by a reasonably 

intelligent person who has examined the context of the entire integrated 

agreement and who is cognizant of the customs, practices, usages[,] and 

terminology as generally understood in the particular trade or business.” 

Law Debenture Tr[.] Co. of N.Y. v. Maverick Tube Corp., 595 F.3d 458, 466 

(2d Cir. 2010) (internal quotation marks omitted). “No ambiguity exists 

where the contract language has a definite and precise meaning, 

unattended by danger of misconception in the purport of the [contract] 

itself, and concerning which there is no reasonable basis for a difference 

of opinion.” Id. at 467 (internal quotation marks omitted). “[W]hen the 

terms of a written contract are clear and unambiguous, the intent of the 

parties must be found within the four corners of the contract . . . .” 

Howard v. Howard, 292 A.D.2d 345, 740 N.Y.S.2d 71, 71 (2d Dep’t 2002) 

(citations omitted).

Chesapeake Energy Corp. v. Bank of N.Y. Mellon Tr. Co., 773 F.3d 110, 113–14 (2d Cir. 

2014). Neither Appellant nor Macquarie claims that any of the provisions of the 

various documents that we interpret are ambiguous.

C. An event of default occurred by the prepayment of the Mezzanine

Loan.

There is no dispute that the Mezzanine Loan was discharged. But Appellant

launches a three-pronged attack on Macquarie’s contention that the discharge was an 

event of default because it constituted a prepayment of the Mezzanine Loan without 

Macquarie’s written consent: (1) the Mezzanine Loan had been accelerated before it 
14

was discharged, and no provision of the Loan Agreement alters the conventional

definition of prepayment, which provides that discharge of a matured obligation is not 

a prepayment; (2) the entity making the payment to discharge the Mezzanine Loan 

was not an entity prohibited from doing so by the Loan Agreement; and (3) there is a 

fact issue regarding whether the discharge of the Mezzanine Loan was a settlement of

that obligation rather than a prepayment. We reject these arguments because (1) both

the Loan Agreement and the Mezzanine Loan Agreement provide that a prepayment 

may occur after acceleration; (2) the Loan Agreement provides that Macquarie’s

consent was required for any prepayment and not just a prepayment made by a

limited number of entities; and (3) the documentation of the discharge of the 

Mezzanine Loan described it as a payoff, and the attempt to use the testimony of 

Appellant’s representative—that his “understanding” of the transaction was different 

than how it was documented—does not create a fact issue.

1. Why we reject Appellant’s argument that payment of the 

Mezzanine Loan after it was accelerated could not constitute

a prepayment

In the first portion of its argument under its Issue 1.a., Appellant argues that 

there was no prepayment of the Mezzanine Loan because it was paid after it was 

accelerated by the Mezzanine Lender, and thus the debt could not have been “pre”-

paid because it had already matured. Appellant’s argument pivots on the contentions

that New York law defines prepayment as payment that occurs prior to maturity; the

Loan Agreement does not provide any definition that alters the conventional
15

definition; and because the conventional definition is not altered by the agreement, 

there was no prepayment of the Mezzanine Loan. Macquarie counters that the

conventional definition of prepayment may be altered by agreement and that the loan 

documents governing both its loan and the Mezzanine Loan define prepayment to 

include payment made after maturity; thus, Macquarie contends that the payoff of the 

Mezzanine Loan was a prepayment even though it occurred after acceleration of that 

debt. We agree with Macquarie’s analysis.

a. The conventional definition of “prepayment” under 

New York law and how the parties’ agreement may 

have altered that definition

For its conventional definition of prepayment, Appellant relies on New York 

cases that generally provide that

“‘[p]repayment’ is a payment before maturity. ‘Acceleration’ is a change in 

the date of maturity from the future to the present. Once the maturity

date is accelerated to the present, it is no longer possible to prepay the 

debt before maturity. Any payment made after acceleration of the 

maturity date is payment made after maturity, not before[.’]” (Rodgers v. 

Rainier Nat[’l] Bank, 111 Wash.2d 232, 237, 757 P.2d 976 [1988]

[emphasis in the original]; see[] also[] In re LHD Realty Corp., 726 F.2d 327, 

330–331 [7th Cir. 1984]).

Nw. Mut. Life Ins. Co. v. Uniondale Realty Assocs., 816 N.Y.S.2d 831, 834 (N.Y. Sup. Ct. 

2006).

But one of the very cases that Appellant cites for the conventional definition of

prepayment notes that the conventional definition may be altered by agreement; the

full context of a quote from a case that Appellant relies on observes that
16

[c]ontrary to the mortgagee’s contention, the mortgagor’s tender of 

payment of the entire mortgage principal plus interest to the scheduled 

date of closing in response to her acceleration of the debt upon default 

did not constitute a “prepayment” of the debt within the meaning of the 

prepayment clause set forth in the mortgage. Accordingly, absent a 

contractual provision to the contrary, the mortgagee was precluded from 

assessing a prepayment penalty (see Kilpatrick v. Germania Life Ins. Co., 183 

N.Y. 163, 168, 75 N.E. 1124; 3C Assoc[s]. v. IC & LP Realty Co., 137 

A.D.2d 439, 440, 524 N.Y.S.2d 701; [Nw.] Mut. Life Ins. Co. . . . , 11 

Misc.3d 980, 985, 816 N.Y.S.2d 831; George H. Nutman, Inc. v. Aetna Bus. 

Credit, 115 Misc.2d 168, 169, 453 N.Y.S.2d 586).

D.I.S. LLC v. Sagos, 832 N.Y.S.2d 581, 582 (N.Y. App. Div. 2007) (emphasis added).

Macquarie, in turn, cites cases emphasizing that prepayment, in general, is

subject to the definition that the parties place on it and that, in particular, a specific

definition may provide that a debt paid after acceleration is still a prepayment.

SO/Bluestar, LLC v. Canarsie Hotel Corp., 825 N.Y.S.2d 80, 81 (N.Y. App. Div. 2006)

(“Prepayment clauses will be enforced according to their terms. The Note contained 

an express provision providing for the payment of prepayment consideration in the 

event of acceleration upon default, and such a provision is enforceable[.]” (citations 

omitted)); In re Fin. Ctr. Assocs. of E. Meadow, L.P., 140 B.R. 829, 835 (Bankr. E.D.N.Y.

1992) (analyzing New York case law and holding that it permitted lender to assess 

prepayment penalties even though it had accelerated the obligation).

b. Why Appellant argues that the conventional definition

of prepayment adheres and why we reject that 

argument

The central pillars of Appellant’s argument are apparently (1) that the Loan 

Agreement, though it contains twenty-eight pages of definitions, does not define 
17

prepayment and (2) that the provisions of the Loan Agreement requiring written

consent for “any prepayment or refinancing of the Mezzanine Loan” cannot mean a 

payment after acceleration because the Loan Agreement does not provide a definition

that alters the conventional definition of the term. Thus, Appellant argues that 

“[b]ecause ‘prepayment’ is not defined in the Agreement, New York law commands 

that this term be given its ordinary and customary meaning and application.”

The Loan Agreement specifies that an event of default occurs “if any

prepayment or refinancing of the Mezzanine Loan shall occur without the prior 

written consent of Lender, or if Borrower shall fail to comply with any of the terms, 

covenants[,] and conditions of Section 4.2.21.” In turn, Section 4.2.21 provides, 

“Except to the extent expressly permitted pursuant to the terms of this Agreement, 

neither Borrower, Guarantor[,] nor Mezzanine Borrower shall make any partial or full 

prepayments of amounts owing under the Mezzanine Loan or refinance the

Mezzanine Loan without the prior written consent of Lender.” It is true that neither

of these sections contains an internal definition of prepayment.

But Macquarie relied on a different provision to argue that the Loan 

Agreement has a more tailored definition of prepayment. Section 2.3.3 of the Loan 

Agreement is the provision in question, and it provides that

[i]f all or any part of the principal amount of the Loan is prepaid upon

acceleration of the Loan following the occurrence of an Event of

Default prior to the Permitted Prepayment Date, Borrower shall be

required to pay Lender, in addition to all other amounts then payable

hereunder (including, without limitation, (i) in the event that such 
18

prepayment is received on a Monthly Payment Date, interest accruing on 

such amount calculated through and including the end of the Interest 

Period in which such Monthly Payment Date occurs, or (ii) in the event

that such prepayment is received on a date other than a Monthly 

Payment Date, interest accruing on such amount calculated through and

including the end of the Interest Period in which the next Monthly

Payment Date occurs), together with the Exit Interest, a Spread

Maintenance Premium calculated with respect to the amount of principal 

being repaid[,] and Breakage Costs.

Appellant does not challenge that this provision establishes that a prepayment may 

occur after acceleration but instead argues that it is of no aid to Macquarie because it 

references the prepayment of Macquarie’s Loan and not that of the Mezzanine Loan. 

Appellant reads a great deal into the tailoring of the definition of prepayment to

govern Macquarie’s Loan but not a corresponding definition of prepayment of the 

Mezzanine Loan; Appellant argues, “In other words, if the parties knew how to define 

or qualify a ‘prepayment’ such that one may occur after acceleration, then their failure 

to employ that same language in the other provision must be deemed as intentional.”

Macquarie responds by emphasizing that Appellant is not arguing that the 

language of Section 2.3.3 fails to establish that a prepayment may occur after 

acceleration. It then highlights that the Mezzanine Loan Agreement contains a

substantially identical provision to the Loan Agreement’s Section 2.3.3 in its own 

Section 2.3.3. In Macquarie’s words, “These materially identical provisions establish 

that the parties contemplated a prepayment after acceleration under both the Loan 

Agreement and the Mezzanine Loan Agreement.”
19

Macquarie also notes that other provisions of both the Loan Agreement and

the Mezzanine Loan Agreement support an interpretation that a payment after 

acceleration constitutes a prepayment. Both loan agreements contain a Section 2.4.1.

In the Mezzanine Loan Agreement, the provision reads, “Except as otherwise

provided herein, Borrower shall not have the right to prepay the Loan in whole or in 

part. Borrower may, provided no Event of Default has occurred, at its option, prepay 

the Debt in whole but not in part, provided the following conditions are 

satisfied . . . .” In the Loan Agreement, the provision reads, “Except as otherwise 

provided herein, Borrower shall not have the right to prepay the Loan in whole or in 

part. On and after the Permitted Prepayment Date, Borrower may, provided no 

Event of Default has occurred, at its option, prepay the Debt in whole but not in

part.” By its terms, Section 2.4.1 in both loan agreements contemplates that there 

may be prepayment after an event of default—one consequence of which could be 

the acceleration of the debt.

Both agreements also contain another provision that further undermines a 

conclusion that the agreements contemplate that a repayment cannot occur after 

acceleration. Section 2.4.3 of the loan agreements provides that “[i]f after an Event of 

Default, payment of all or any part of the principal of the Loan is tendered by

Borrower, a purchaser at foreclosure[,] or any other Person, such tender shall be 

deemed an attempt to circumvent the prohibition against prepayment set forth in 

Section 2.4.1.” Again, prepayment under this provision occurs after an event of 
20

default and contemplates the possibility that a foreclosure sale has occurred; a 

foreclosure sale presumably would occur after acceleration of the debt. Thus, the

import of this provision is contrary to Appellant’s argument that the Loan Agreement

contemplates that a prepayment may occur only before acceleration.

In its reply brief, Appellant raises two arguments to challenge reliance on the 

sections of the loan agreements that Macquarie’s arguments highlight. First, 

Appellant argues that

[o]nly one provision in the Agreement uses the phrase “prepaid upon 

acceleration.” Yet, again, the provisions Macquarie accuses [Appellant]

of violating employ different language. Paragraph 4.2.21 refers to

“partial or full prepayments[,]” and paragraph 11.1(a)(xxiii) refers to

“prepayment or refinancing . . . .” Neither mentions acceleration, and 

that omission must mean something. “Under accepted canons of 

contract construction, when certain language is omitted from a provision 

but placed in other provisions, it must be assumed that the omission was 

intentional . . . .” Sterling Inv. Servs., Inc. v. 1155 Nobo Assoc[s]., LLC, 30 

A.D.3d 579, 581 (N.Y.S.C. App. Div. 2006) (citing U[.]S[.] Fid. & Guar. 

Co. v. Annunziata, 67 N[.]Y[.]2d 2[2]9, 233 (N.Y. 1986)). [Record 

references omitted.]

But this argument ignores another principle of construction under New York law that 

we conclude is more applicable—the principle that the provisions of a contract 

should be harmonized. In re AMR Corp., 485 B.R. 279, 303 (Bankr. S.D.N.Y. 2013) 

(“New York law provides that a court should construe a contract in a way that

reasonably harmonizes its provisions and avoids inconsistencies.”). Appellant’s 

argument is at odds with this principle; Appellant concedes that several provisions of 

the Loan Agreement provide that prepayment includes payment after acceleration, but
21

Appellant contends that when the Loan Agreement uses the word “prepayment”

without further elaboration, then it must be given a different definition. Appellant’s 

argument fails to explain why, if the loan agreements contemplate a prepayment may 

occur after acceleration, a drafter would be forced to define the term every time it is used 

or else face a construction that it has a meaning not elsewhere used in the document.

Appellant’s second argument challenges Macquarie’s reliance on the provisions 

of the Mezzanine Loan Agreement; in Appellant’s view, that agreement has no

bearing on the construction of the Loan Agreement because they are separate

documents between different parties. Appellant argues that “Macquarie provides no 

reason why a completely different contract should govern this dispute.” But “[u]nder 

New York law, all writings forming part of a single transaction are to be read 

together.” This Is Me, Inc. v. Taylor, 157 F.3d 139, 143 (2d Cir. 1998). Appellant itself 

acknowledges that Macquarie’s Loan and the Mezzanine Loan were a part of the 

package put together to purchase the hotel. Indeed, Macquarie and the Mezzanine

Lender entered into an Intercreditor Agreement—the stated purpose of which was to 

coordinate the impact of the respective loan agreements:

WHEREAS Senior Lender and Mezzanine Lender desire to enter into 

this Agreement to provide for the relative priority of the Senior Loan 

Documents and the Mezzanine Loan Documents on the terms and 

conditions hereinbelow set forth, and to evidence certain agreements 

with respect to the relationship between the Mezzanine Loan and the 

Mezzanine Loan Documents, on the one hand and the Senior Loan and 

the Senior Loan Documents, on the other hand.
22

Appellant does not explain why the Loan Agreement and the Mezzanine Loan 

Agreement should not be read together when they were integrated together as part of 

the same transaction nor why there should be variant definitions of prepayment in the

different loan agreements. Appellant’s argument appears to be a recipe for chaos

because the two loan agreements were integrated together and coordinated the right 

to payment but, according to Appellant, are supposed to be interpreted as having 

different definitions of prepayment for the Mezzanine Loan. In other words, the 

effect of Appellant’s argument is that prepayment under the Mezzanine Loan 

Agreement can occur after acceleration, but it cannot under the Loan Agreement. At

a more basic level, Appellant also fails to explain the logic of why Macquarie could

not view the Mezzanine Loan as having been prepaid, even though the payment

occurred after acceleration, when the agreement governing that loan provides that 

such a payment is a prepayment.

The provisions of the Loan Agreement and the Mezzanine Loan Agreement

demonstrate that the parties contemplated that the early payoff of the Mezzanine

Loan was a prepayment, even if that loan had been accelerated. We overrule the first 

portion of Appellant’s argument under its Issue 1.a.

2. Why we reject Appellant’s argument that the Loan 

Agreement did not prohibit prepayment of the Mezzanine

Loan by the entity that made the payment

In the second portion of its argument under its Issue 1.a., Appellant argues that 

the Loan Agreement prohibits prepayment only by certain entities and that the entity 
23

that paid off the Mezzanine Loan—Vesta—is not included in that list; thus, even if 

the Loan Agreement prohibited a prepayment after acceleration, it did not prohibit the 

prepayment that occurred because the payment was not made by an entity prohibited by 

the Loan Agreement from making a prepayment. We disagree because the provision that 

Appellant references creates two alternate events of default—one of which prohibited 

any prepayment of the Mezzanine Loan without Macquarie’s written consent.

The parties agree that the Loan Agreement’s prohibition on prepayment is 

found in its Section 11.1(a)(xxiii), which as we have noted provides that an event of 

default occurs “if any prepayment or refinancing of the Mezzanine Loan shall occur 

without the prior written consent of Lender, or if Borrower shall fail to comply with

any of the terms, covenants[,] and conditions of Section 4.2.21.” [Emphasis added.] 

Again, the Section 4.2.21 referred to in the second phrase of the quoted section 

provides, “Except to the extent expressly permitted pursuant to the terms of this 

Agreement, neither Borrower, Guarantor[,] nor Mezzanine Borrower shall make any 

partial or full prepayments of amounts owing under the Mezzanine Loan or refinance 

the Mezzanine Loan without the prior written consent of Lender.”

The parties agree that the party that actually paid off the Mezzanine Loan was 

not one of the parties listed in Section 4.2.21. To capitalize on this fact, Appellant

argues that the broadly phrased first clause of Section 11.1(a)(xxiii)—“if any

prepayment or refinancing of the Mezzanine Loan shall occur without the prior 

written consent of Lender”—should be read to parallel Section 4.2.21 and creates an 
24

event of default only if the prepayment is made by one of the entities listed in the 

latter section. [Emphasis added.]

Macquarie counters that Appellant’s interpretation ignores the disjunctive

structure of Section 11.1(a)(xxiii), which creates two distinct events of default—one of 

which is an all-encompassing prepayment of the Mezzanine Loan without its consent. 

Again, we must adhere to the terms of the document as written, and Macquarie’s 

interpretation is more faithful to the Loan Agreement’s terms.

Macquarie presents a straightforward interpretation of the default provision:

[Section] 11.1(a)(xxiii) states that any prepayment without Macquarie’s 

prior written consent constitutes an Event of Default. Although this 

section also prohibits any violation of [Section] 4.2.21, it is not limited to 

such violations. The prohibition on “any prepayment or refinancing” is 

in a separate phrase from the prohibition related to . . . [Section] 4.2.21[,]

and these phrases are separated by an “or,” indicating that either one of 

them separately constitutes an event of default. The use of the modifier 

“any” further confirms that all prepayments required Macquarie’s prior 

written consent. See Ali v. Fed. Bureau of Prisons, 552 U.S. 214, 219 (2008) 

(“‘any’ has an expansive meaning, that is, ‘one or some indiscriminately

of whatever kind’”); Zanghi v. Greyhound Lines, Inc., 651 N.Y.S.2d 833,

834–35 (N.Y. App. Div. 1996) (separate categories “disjunctively joined 

by ‘or’” were “separate alternatives”). [Record references omitted.]

The cases that Macquarie cites for the power of the disjunctive deal with 

statutory interpretation. New York cases dealing with contract interpretation vest the 

disjunctive with the same power. For example, a New York federal district court dealt 

with the question of whether a concrete slab had to meet two tests or only one test

for the levelness specified in a contract. See Pioneer Valley Concrete Serv., Inc. v. JAG I, 

LLC, No. 1:10-CV-1311, 2013 WL 6230105, at *13 (N.D.N.Y. Dec. 2, 2013) (mem.
25

decision and order). One party argued that even though the two tests of levelness 

were separated by the disjunctive, the slab’s levelness had to meet both tests’ 

standards. Id. The court summarized the argument made and the authority 

establishing that the use of the disjunctive was an unambiguous signal that the phrases 

were freestanding alternatives:

Plaintiff argues that the use of the word “or” in the Gymnasium Floor 

Specs should be interpreted to mean “and.” Thus, Plaintiff argues, 

Pioneer was obligated to Whiting–Turner, and JAG was obligated to 

Pioneer, to place and finish the Gymnasium Floors such that they met 

both the F-number and 10′ straightedge tests [for levelness]. The plain 

terms of the contract do not support such an interpretation.

The Court finds the terms of the Gymnasium Floor Specs to be 

unambiguous. Accordingly, the Court need not go outside the four 

corners of the contract to understand its meaning. Contrary to

Plaintiff’s position, the Court finds as a matter of law that Pioneer’s 

obligation to Whiting–Turner, and by extension JAG’s obligation to 

Pioneer, could be satisfied by placing and finishing Gymnasium Floors 

that met either the F-number or 10′ straightedge test. See Del Global 

Tech[s.] Corp. v. Park, No. 03 Civ. 8867, 2008 WL 5329963, *4 (S.D.N.Y. 

Dec. 15, 2008) (holding that the second clause in a contract provision 

which was introduced by the disjunctive “or” indicates an alternative 

event and could satisfy a condition independent of the first clause); 

Portside Growth [&] Opportunity Fund v. Gigabeam Corp. . . . , 557 F. Supp.

2d 427, 431 (S.D.N.Y. 2008) (observing that “[f]or [defendant] to prevail 

. . . the contested language must override the ordinary presumption that 

the term ‘or’ expresses an alternative” and explaining “that ‘or’ is a 

disjunctive particle used to express an alternative or to give a choice of

one or among two or more things”) (citations and quotations omitted);

Cresvale Int’l v. Reuters Am., Inc., 257 A.D.2d 502, 684 N.Y.S.2d 219, 222 

(1st Dept. 1999) (holding that words in a contract clause stated in the 

disjunctive must be considered separately (citing Coutu v. Exch. Ins. Co., 

174 A.D.2d 241, 579 N.Y.S.2d 751, 752 (1st Dept. 1992)); cf. Progressive 

[Ne.] Ins. Co. v. State Farm Ins. [Cos.], 81 A.D.3d 1376, 916 N.Y.S.2d 454, 

456–57 (4th Dept. 2011) (holding that “[i]nterpreting [contract] language 

in the manner urged by [defendant] effectively turn[ed] the conjunctive 
26

‘and’ into a disjunctive ‘or’ “ which was unsupported by “[t]he structure 

of the sentence” and contrary to the “plain language of the sentence as it 

would be understood by an average or ordinary citizen”).

Id.

Thus, giving the disjunctive the power that it commands, Section 11.1(a)(xxiii) 

offers two alternative events of default:

• if any prepayment or refinancing of the Mezzanine Loan shall occur 

without the prior written consent of Lender

or

• if Borrower shall fail to comply with any of the terms, covenants, and 

conditions of Section 4.2.21. 

Based on our holding above, there was a prepayment of the Mezzanine Loan, and the 

prepayment triggered a default under the first alternative phrase.

Appellant tries to sidestep the presence of the two coequal alternatives created

by Section 11.1(a)(xxiii)’s use of the disjunctive by arguing (1) that the two alternatives 

are inconsistent, so we must prioritize what Appellant argues is the more specific 

phrase referring to Section 4.2.21, and (2) that not adopting this approach will render 

Section 4.2.21 superfluous. To read into the Loan Agreement the inconsistency that

Appellant sees requires an interpretation that it was the parties’ intent that only a 

prepayment by the entities specified in Section 4.2.21 could trigger a default, but that

is simply not what the document provides. We have no idea what the parties’
27

subjective intent was in creating the belt-and-suspenders approach evidenced by the 

two alternative phrases of Section 11.1(a)(xxiii) and need not delve into the parties’

intent in view of the language utilized because no one argues that the language is 

ambiguous, nor do we think that it is. Indeed, at various points in its brief and in the 

summary-judgment record, Appellant touts the sophistication of its principals and the

caliber of the law firms negotiating the Agreement.4

 One result of these negotiations 

was a clause written in plain language that set as one of the alternative events of 

default any prepayment of the Mezzanine Loan without Macquarie’s written consent.

We overrule the second portion of Appellant’s argument under its Issue 1.a.

3. Why we reject Appellant’s argument that a fact issue exists 

because discharge of the Mezzanine Loan was a settlement

rather than a payoff

Appellant’s final challenge under its Issue 1.a. is to the characterization of the 

discharge of the Mezzanine Loan as a prepayment because it was not a payoff of that 

loan but rather a termination of that loan to settle a prelitigation dispute. We reject 

this argument because it is contrary to the terms of the document implementing the 

discharge; that document characterizes the payment as a payoff.

To give the discharge of the Mezzanine Loan the gloss of a “settlement,”

Appellant relies on the “understanding or belief” of how the transaction should be

4

When dealing with another issue, Appellant highlights that “[h]ere, even 

though the Agreement extends to some 129 single-spaced pages [of text] and was 

entered into by sophisticated parties employing highly capable law firms, the 

Agreement contains no attorney-fee provision at all.”
28

characterized as contained in the affidavit of its representative, Mr. Patel. The 

affidavit states the following:

It was not the understanding or belief of me or of [Appellant] that the

Mezzanine Transfer was a payment of the Mezzanine Loan. Rather, 

both [Appellant] and the Mezzanine Lender made legal allegations and

threatened legal action, there were multiple and substantial disputes as to 

whether there was a default and whether the Mezzanine Lender’s

calculation of $30,175,559.48 as a loan payoff was correct, [Appellant]

had threatened to file bankruptcy to stop the foreclosure, and the issues 

became not amounts owing on a promissory note[] but contested legal 

rights and legal damages. It is in this context that the Mezzanine 

Transfer occurred[] and that the parties entered into the settlement

agreement included as Exhibit E, which agreement does not reference 

any payment[] but rather speaks in terms of settlement, exhaustion [of]

rights, and termination of the Mezzanine Loan.

Relying on this paragraph’s “understanding or belief” of how the discharge of the 

Mezzanine Loan should be characterized, Appellant argues, “Thus, the payment by

Vesta Equity to the Mezzanine Lender was a payment to settle complicated and hotly 

disputed legal rights, and the Mezzanine Loan was terminated, not paid off.” [Emphasis

added.]

But the very document that Appellant points us to describes the payment that 

was made to discharge the Mezzanine Loan as a “payoff.” In fact, the very page of 

the record that Appellant’s brief refers us to—the first page of the document

referencing the discharge of the debt—characterizes the payment as follows:

Lender has been asked to accept a discounted payoff amount with 

respect to the Loan (hereinafter referred to as the “Discounted Payoff 

Amount”). The Discounted Payoff Amount for a discounted payoff of 

the Loan on or before March 23, 2018[,] is $28,575,000.00. Borrower 
29

shall pay the Discounted Payoff Amount in accordance with the wire 

instructions set forth below.

A summary-judgment affidavit that attempts to gloss over and contradict the 

terms of the very document to which it refers transgresses a host of rules governing 

what constitutes admissible summary-judgment evidence. The parol-evidence rule 

prevents a party from relying on summary-judgment evidence that varies or 

contradicts a written document. H.E.B., L.L.C. v. Ardinger, 369 S.W.3d 496, 511 (Tex. 

App.—Fort Worth 2012, no pet.). A person’s subjective beliefs are not competent 

summary-judgment evidence. Krishnan v. Law Offs. of Preston Henrichson, P.C., 83 

S.W.3d 295, 299 (Tex. App.—Corpus Christi–Edinburg 2002, pet. denied)

(“Statements of subjective belief are no more than conclusions and are not competent 

summary[-]judgment evidence.”) (citing Tex. Div.–Tranter, Inc. v. Carrozza, 876 S.W.2d

312, 314 (Tex. 1994)). Nor do legal conclusions constitute competent summaryjudgment evidence. Johnson v. Dunham, No. 11-20-00123-CV, 2022 WL 969516, at *8

(Tex. App.—Eastland Mar. 31, 2022, no pet.) (mem. op.) (citing Mercer v. Daoran Corp., 

676 S.W.2d 580, 583 (Tex. 1984)).

At bottom, the “understanding or belief” that Appellant offers to 

recharacterize the nature of the payment made to discharge the Mezzanine Loan is 

unavailing when it stands in contradiction to the terms of the document that 

conveyed and characterized that payment. We overrule Appellant’s last argument

under its Issue 1.a. and thus overrule Issue 1.a. in its entirety.
30

D. Because of our disposition of Appellant’s Issue 1.a., we do not 

reach its Issue 1.b.

Appellant’s Issue 1.b. challenges Macquarie’s actions of declaring the loan to be 

in default and charging the default rate of interest because Appellant allegedly

exercised a parking-lot option with Macquarie’s written consent. This alleged event of 

default occurred after the prepayment default that we have already addressed, and 

Macquarie was already charging the default rate of interest before the alleged second 

default occurred. Thus, we have concluded that a default occurred that supported the 

charging of default interest for the full period that it was charged. This conclusion

supports the trial court’s judgment that Macquarie did not breach the Loan Agreement 

by charging default interest. Therefore, we do not reach the question of the propriety 

of Macquarie’s actions in declaring the loan in default based on the failure of Appellant

to obtain written consent before allegedly exercising the parking-lot option.

5

5

We also do not reach Appellant’s arguments made without support of an issue 

that the trial court improperly accepted Macquarie’s challenges to its damage model; 

those arguments claimed that Macquarie’s publication of its invalid claims that

Macquarie’s Loan was in default devalued the hotel property owned by Appellant. 

This claim appears to be pleaded as a measure of damage associated with the breachof-contract claim by improperly declaring an event of default. Specifically, Appellant

pleaded that

upon information and belief, [Macquarie] has recently attempted to sell 

its loan. In the process, [Macquarie] (through its agent) prepared a flyer, 

which it caused to be transmitted to many brokers, buyers, lenders, and 

other participants in the hotel industry. In that flyer, [Macquarie] (through its

agent) falsely claimed that the loan was in default, and [Macquarie] referenced the

default interest now being charged as a “premium.” This caused further damage 

to [Appellant] by way of a loss of value of the [h]otel, damage that was
31

E. Appellant has waived its issue on appeal that Macquarie consented 

to the prepayment of the Mezzanine Loan.

In its Issue 1.c., Appellant argues that “Macquarie’s consent precluded

summary judgment.” But Appellant does not challenge that the Loan Agreement 

required written consent to the prepayment of the Mezzanine Loan.6

 Appellant’s

brief never tells us what legal defense prevented Macquarie from forgoing its 

contractual right to require written consent, what the elements are for that defense, or 

how its summary-judgment evidence met the required standard. Appellant has waived 

any such complaint on appeal.

foreseeable by [Macquarie], that was intended by [Macquarie], and that 

was proximately caused by [Macquarie]. Namely, even as [Appellant]

was about to market the [h]otel for a potential sale, [Macquarie] created 

an impression in the market that the loan was in default, leading to a 

belief that [Appellant] may be more desperate to sell the [h]otel, leading 

to a lower value due to the false market impression caused by

[Macquarie]. [Emphasis added.]

Also, during oral argument, Appellant’s counsel conceded that Appellant was 

not bringing a freestanding trade disparagement claim because of Macquarie’s 

statements. Because the devaluation claim was predicated on the claim that

Macquarie improperly declared the loan in default and because we have held that the 

loan was in default, we do not reach the challenges related to a damage model that 

presumed there was a breach of contract.

Also as a result of our holding, we need not reach Appellant’s alternative issues 

on whether Mr. Patel was a credible witness and whether the payments made by 

Appellant were voluntary. With respect to Appellant’s arguments regarding whether 

one party was attempting to smear another, those arguments are irrelevant based on 

our legal rulings that are predicated on our construction of the loan agreements.

6

The Loan Agreement required any modifications or waivers to be in writing 

(Section 12.4) and required all notice under the agreement to be in writing (Section 12.6).
32

Based on our holdings and the summary-judgment record, two matters are no 

longer in dispute: (1) the Loan Agreement provides that it is an event of default “if 

any prepayment or refinancing of the Mezzanine Loan shall occur without the prior 

written consent of the Lender,” and (2) Macquarie never gave written consent for the 

prepayment at issue. In response to Macquarie’s counterclaim asserting that 

prepayment of the Mezzanine Loan constituted a breach of contract, Appellant 

pleaded—without elaboration—that “[Appellant] asserts that [Macquarie’s]

counterclaims are barred by waiver, estoppel, and/or quasi-estoppel.” In its response

to Macquarie’s motion for summary judgment, Appellant argued that Macquarie

“consented” to prepayment, even though there was no written consent, and Appellant 

specifically relied on the defenses of estoppel and oral modification of the contract.

Appellant’s brief asserts that Macquarie “consented” to the prepayment but 

then cites only a smattering of sentences from Mr. Patel’s affidavit; Appellant does 

not cite any cases or even reference a legal theory that allowed it to avoid the 

requirement of written consent.

7 Appellant’s reply brief is no more enlightening when 

7

The substance of Appellant’s briefing on this issue is as follows:

For the alleged “prepayment,” the summary[-]judgment record includes

evidence that Macquarie set forth the conditions [that Appellant] needed 

to satisfy to obtain Macquarie’s consent. Mr. Patel testified[,]

Macquarie indicated and represented to me . . . that it 

would consent to a payoff of the Mezzanine Loan, 

provided that the funds to make such payment did not 

come from [Appellant] (which they did not), provided that 
33

it argues that Macquarie’s brief improperly invokes the sham-affidavit doctrine to 

challenge Mr. Patel’s affidavit and leaves it at that—again, not even referencing what 

defense Appellant relied on or citing any authority to guide us in determining whether

a fact issue was raised on the defense, whatever it might be.

Procedurally, if Appellant were attempting to raise an affirmative defense to 

thwart the Loan Agreement’s requirement of written consent, Appellant bore the 

burden to establish that a fact issue existed on each element of that defense:

the funds would not be in the form of additional debt

against the [h]otel (which they were not), and provided that

there would be no change in control which might 

jeopardize the franchise, the liquor license, or [h]otel

operations (which there was not).

Mr. Patel continued, “Ultimately, [Appellant] satisfied each requirement

that Macquarie set forth as a condition for obtaining its consent.” For

the avoidance of doubt[,]

None of the funds used to make the Mezzanine Transfer 

came from funds or property of [Appellant] or any affiliate, 

or from any entity that was obligated on or had guaranteed 

[Appellant]’s obligations to Macquarie. None of the funds 

used to make the Mezzanine Transfer came from 

Macquarie’s collateral[] or the proceeds of its collateral. 

The funds came in as pure equity, and not as debt against 

[Appellant], any other obligor or guarantor, the property of 

[Appellant] or any other obligor or guarantor, or anyone

else.

The documentary evidence backs up Mr. Patel’s testimony. The 

wire receipt shows the funds came [from] an entity known as Vesta 

Equity, LLC. As Mr. Patel explained, Vesta was one of [Appellant]’s

indirect equity owners. [Record references omitted.]
34

If, as here, the non[]movant relies on an affirmative defense to oppose

the summary[-]judgment motion, he must provide sufficient

summary[-]judgment evidence to create a fact issue on each element of 

the defense. See Brownlee v. Brownlee, 665 S.W.2d 111, 112 (Tex. 1984); 

Anglo–Dutch Petroleum Int’l, Inc. v. Haskell, 193 S.W.3d 87, 95 (Tex.

App.—Houston [1st Dist.] 2006, pet. denied). The non[]movant is not 

required to prove the affirmative defense as a matter of law; raising a fact 

issue is sufficient to defeat summary judgment. See Brownlee, 665 S.W.2d

at 112; Anglo–Dutch Petroleum, 193 S.W.3d at 95.

Tello v. Bank One, N.A., 218 S.W.3d 109, 114 (Tex. App.—Houston [14th Dist.] 2007, 

no pet.).

The parties’ summary-judgment briefing contains a host of arguments and 

counter-arguments regarding whether consent occurred or why New York law did or 

did not permit a waiver of the written-consent requirement. The arguments even 

include a citation to a provision of the New York General Obligation Law that

allegedly prohibited any attempt to orally modify the written-consent requirement.

Appellant’s brief leaves it to us to unearth what legal doctrines the parties invoked, to 

determine the elements and parameters of those doctrines, and then to formulate how 

the evidence interacts with those elements. The superficial treatment that Appellant

gives the consent issue does not constitute proper briefing. See Tex. R. App. P. 

38.1(f), (h), (i).

A concurring opinion from the Dallas Court of Appeals has outlined what 

constitutes proper briefing as follows:

An appellant has the burden to present and discuss his assertions of 

error in compliance with the appellate briefing rules. Amir-Sharif v. Tex. 

Dep’t of Fam[.] & Protective Servs., No. 05-13-00958-CV, 2015 WL
35

4967239, at *2 (Tex. App.—Dallas Aug. 20, 2015, pet. denied) (mem. 

op.); Ayati-Ghaffari v. Gumbodete, No. 05-14-01019-CV, 2015 WL 

4482158, at *3 (Tex. App.—Dallas July 23, 2015, no pet.) (mem. op.);

Cruz v. Van Sickle, 452 S.W.3d 503, 511 (Tex. App.—Dallas 2014, [pets.

denied]). The Texas Rules of Appellate Procedure have specific 

requirements for briefing. Tex. R. App. P. 38; Bolling v. Farmers Branch

Indep. Sch. Dist., 315 S.W.3d 893, 895 (Tex. App.—Dallas 2010, no pet.). 

These rules require appellants to state their complaint concisely; to 

provide understandable, succinct, and clear argument for why their 

complaint has merit in fact and in law; and to cite and apply law that is 

applicable to their complaint along with record references that are 

appropriate. Tex. R. App. P. 38.1(f), (h), (i); RSL Funding, LLC v.

Newsome, 569 S.W.3d 116, 126 (Tex. 2018); see also Bolling, 315 S.W.3d at 

895. This requirement is not satisfied by merely making brief, 

conclusory statements unsupported by legal citations. Canton-Carter v. 

Baylor Coll. of Med., 271 S.W.3d 928, 931 (Tex. App.—Houston [14th 

Dist.] 2008, no pet.). And references to sweeping statements of general 

law are rarely appropriate. Bolling, 315 S.W.3d at 896.

Eco Planet, LLC v. ANT Trading, No. 05-19-00239-CV, 2020 WL 6707561, at *5 (Tex. 

App.—Dallas Nov. 16, 2020, pet. denied) (mem. op.) (Osborne, J., concurring).

Further, we have previously noted why we cannot take on the role of briefing a 

party’s argument for it:

[W]e do not and cannot assume the responsibility of doing the parties’ 

briefing for them. Our role is to review the arguments made and 

dispose of the appeals; we cannot search the record and research the law 

to formulate parties’ arguments for them. See Tex. R. App. P. 38.1(i); see 

also Bolling, 315 S.W.3d at 895. Simply put, we are not advocates for any 

of the parties. Jones v. Am. Real Estate Inv., No. 05-19-00546-CV, 2020 WL 

5834301, at *1 (Tex. App.—Dallas Oct. 1, 2020, no pet.) (mem. op.).

De Los Reyes v. Maris, No. 02-21-00022-CV, 2021 WL 5227179, at *9 (Tex. App.—

Fort Worth Nov. 10, 2021, no pet.) (mem. op.).
36

As we have noted, Appellant’s argument does not even tell us which legal 

theory underpins its argument and would leave it to us to analyze another state’s law 

and then formulate arguments from our research. We will not take on that role.

At times, we will accord a party an opportunity to rebrief after it has filed a

deficient brief. Here, we will not order rebriefing because Appellant has already had 

an opportunity to correct its briefing deficiency. See id. at *8. Macquarie’s brief points

out that “[Appellant] has not raised any legal basis to relieve itself of the 

prior[-]written[-]consent obligation, and any such arguments are therefore waived.”

Even when faced with Macquarie’s challenge, Appellant’s reply brief still failed to 

address what theory or authority supports its position. Instead, it focused on 

Macquarie’s contention that Appellant’s representative’s affidavit is a sham. After 

being accorded an opportunity in its reply brief to support its argument with legal

argument and citations and after being warned by the opposing party of the deficiency

in its briefing, Appellant still failed to brief its issue adequately. In the face of this 

situation, we see no need to accord Appellant an additional opportunity to remedy its 

deficient briefing.

8

8

Macquarie’s argument—that Mr. Patel’s affidavit is a sham because in it he 

contends that Macquarie had consented—centers on the fact that Mr. Patel had 

answered no when asked at his deposition, “Did Macquarie ever consent to any 

payoff of the [M]ezzanine [L]oan?” Macquarie also notes that the email that it argues 

Mr. Patel was referring to in his affidavit clearly showed that Macquarie was not

stating that if certain conditions were met, it would consent. But Mr. Patel appears to 

have testified that he was relying on another email, though he had not reviewed the 

email before his deposition, could not state when he had last read the email, and could 
37

We overrule Appellant’s Issue 1.c.

F. We reject Appellant’s argument that the Loan Agreement imposed 

a duty of good faith and fair dealing on Macquarie.

In its Issue 1.d., Appellant argues that Macquarie violated the duty of good 

faith and fair dealing that exists under New York law by declaring an event of default. 

We disagree. Though the duty is generally implied in all contracts, it is not imposed 

when to do so would be contrary to the terms of the parties’ contract. As explained 

more fully below, a contract that gives a party sole and complete discretion to 

implement a contractual provision negates the duty, though that rule is tempered in 

limited circumstances if the exercise of discretion deprives a party of the fruits of a 

contract and makes the performance it was promised illusory.

Here, the provisions governing Macquarie’s decision to refuse its consent to 

matters such as prepayment vested it with sole discretion and made its decision with 

regard to that discretion final and conclusive. And other than a passing reference to 

the principle, Appellant does not argue that it would be deprived of the fruits of the 

Loan Agreement unless the duty of good faith and fair dealing were imposed on

Macquarie. Indeed, Macquarie did perform by providing the financing that the Loan 

Agreement promised, and to impose the duty in the face of the provision giving 

Macquarie broad discretion would negate that very provision. Thus, we conclude that 

not remember all of its statements. To further complicate matters, Appellant’s 

counsel seemed to acknowledge during the summary-judgment argument that the

email that Macquarie refers to is the email that Mr. Patel mentioned. Because of our 

holding, we need not sort out whether Mr. Patel’s affidavit is a sham.
38

New York law did not impose a duty of good faith and fair dealing on Macquarie

when it did not consent to the prepayment of the Mezzanine Loan.

1. We explain the principles of New York law on the duty of 

good faith and fair dealing and how a contract may abrogate

the existence of that duty.

Undoubtedly, New York applies a general duty of good faith and fair dealing to

contractual relations. As a summary of New York law on the scope of the duty, we 

quote extensively from the recent federal district court decisions of Southern Telecom 

Inc. v. ThreeSixty Brands Group, LLC, No. 20-CV-2151 (LJL), 520 F. Supp. 3d 497 

(S.D.N.Y. Feb. 17, 2021) (corrected order and opinion), and Goureau v. Lemonis, 

No. 1:20-CV-04691, 2021 WL 4847073 (S.D.N.Y. Oct. 15, 2021) (order granting in 

part motion to reconsider).

ThreeSixty provided the following overview of the origin of the duty of good 

faith and fair dealing, its purpose, and how it cannot be imposed when that doctrine’s

application operates inconsistently with a contractual provision:

“Under New York law, a covenant of good faith and fair dealing is 

implied in all contracts.” State St. Bank & Tr. Co. v. Inversiones Errazuriz 

Limitada, 374 F.3d 158, 170 (2d Cir. 2004) (quoting 1-10 Indus. Assocs.,

LLC v. Trim Corp. of Am., 297 A.D.2d 630, 747 N.Y.S.2d 29, 31 (2d 

Dep’t 2002)). “‘This covenant embraces a pledge that neither party shall 

do anything [that] will have the effect of destroying or injuring the right

of the other party to receive the fruits of the contract.’” Id. (quoting 511 

W. 232nd Owners Corp. v. Jennifer Realty Co., 98 N.Y.2d 144, 746 N.Y.S.2d 

131, 135, 773 N.E.2d 496 (2002)). “[T]he implied obligation is in aid 

and furtherance of other terms of the agreement of the parties.” Murphy 

v. Am. Home Prods. Corp., 58 N.Y.2d 293, 461 N.Y.S.2d 232, 237, 448 

N.E.2d 86 (1983). Accordingly, “[n]o obligation can be implied . . .
39

[that] would be inconsistent with other terms of the agreement of the 

parties.” Id.

520 F. Supp. 3d at 504.

Goureau noted New York’s highest court’s application of the duty to a contract 

that gives a party discretion over the invocation of a contractual provision:

The New York Court of Appeals has suggested that a contract provision 

granting discretionary authority to one party may be subject to the 

implied covenant of good faith and fair dealing. See Dalton v. Educ. 

Testing Serv., 87 N.Y.2d 384, 396, 639 N.Y.S.2d 977, 663 N.E.2d 289 

(1995) (“To be sure, there is a covenant of good faith and fair dealing 

implicit in [a] contract [that involves discretionary functions].”). Relying 

on this guidance, courts have ruled that where a contract clause imbued

in a party the discretion to take some action, the implied covenant of 

good faith and fair dealing could adhere to require that the action taken 

be exercised in a way that was not arbitrary or irrational. See, e.g., 

Maddaloni Jew[e]lers, Inc. v. Rolex Watch U.S.A., Inc., 41 A.D.3d 269, 838 

N.Y.S.2d 536 (1st Dep’t 2007).

2021 WL 4847073, at *6.

Goureau then went on to describe how the terms of the contract may delimit the 

scope of the duty and how a contract may vest a party with such a degree of 

discretion that it abrogates a duty to act in good faith. Again, we quote Goureau’s

analysis of New York law:

However, the New York Court of Appeals in Moran v. E[r]k provided 

further guidance [on the scope of the duty of good faith and fair 

dealing]. In Moran, the Court of Appeals ruled that a contingent 

approval clause in a real estate contract did not implicate the implied 

covenant of good faith and fair dealing. 11 N.Y.3d 452, 458–59, 872 

N.Y.S.2d 696, 901 N.E.2d 187. The Moran Court looked to the plain 

meaning of the at-issue contract provision and found that where no 

limitation was placed on the contingent approval as part of the 

bargained-for language, the implied covenant of good faith and fair
40

dealing did not attach. Id. at 459, 872 N.Y.S.2d 696, 901 N.E.2d 187.

Subsequently, Courts in this district and New York have applied Moran

and its logic broadly to discretionary clauses in contracts. See Stokes v. 

Lusker, 2009 U.S. Dist. LEXIS 23471, 2009 WL 612336, at *8 (S.D.N.Y. 

Mar. 4, 2009) (“[A] discretionary contingency clause does not carry with 

it an implied duty of good faith, unless it was explicitly part of the 

bargain.”); Paxi, LLC v. Shiseido Ams. Corp., 636 F. Supp. 2d 275, 286 

(S.D.N.Y. 2009) (“[T]he obligation of good faith and fair dealing does 

not negate an expressly bargained-for clause that allows a party to 

exercise its discretion, unless that clause imposes a limit on the discretion 

to be exercised or explicitly states that the duty of good faith and fair 

dealing applies.”); Serdarevic v. Centex Homes, LLC, 760 F. Supp. [2d] 322, 

334 (S.D.N.Y. 2010).

Subsequent to Moran, state courts applying New York law have 

also refused to recognize a claim for breach of the implied covenant of

good faith and fair dealing where the contract entitles one party to 

exercise complete and sole discretion with respect to the complained[-]of 

actions. Cambridge Invs. LLC v. Prophecy Asset Mgt., LP, 188 A.D.3d 521, 

522, 132 N.Y.S.3d 622 (1st Dep’t 2020) (“Defendant cannot breach the 

covenant of good faith and fair dealing if the contract gives it sole and

complete discretion.”); Transit Funding Assoc., LLC v. Capital One Equip. 

Fin. Corp., 149 A.D.3d 23, 29–30, 48 N.Y.S.3d 110 (1st Dep’t 2017)

(covenant of good faith and fair dealing cannot negate express provision 

of contract); ELBT Realty, LLC v. Mineola Garden City Co., 144 A.D.3d 

1083, 1084, 42 N.Y.S.3d 304 (2d Dep’t 2016) (rejecting implied covenant 

argument where plain language of contract gave termination discretion 

to defendant in “its sole discretion.”).

Id. at *6–7. Because the contract provision under examination in Goureau permitted

certain actions in the sole discretion of the party exercising the right under the provision,

no claim lay that the party exercising the right had to do so in good faith. Id. at *7.9

9

Appellant cites a case that it argues stands for the proposition “that the duty

[of good faith and fair dealing] can be disclaimed ‘only . . . by a specific reference to 

the duty of good faith and fair dealing.’” See Akal Taxi NYC LLC v. City of N.Y.,

No. 708602/2017, 2020 WL 2066396 (N.Y. Sup. Ct. Mar. 16, 2020). As Macquarie

points out, the language that Appellant cites is not a holding of the court but a
41

But turning back to ThreeSixty, the court did not read the seminal Moran

opinion that Goureau cited to completely insulate a party from a claim of breach of

duty of good faith and fair dealing even though a contractual provision vested a party

with the sole discretion to make a decision. In ThreeSixty’s view, Moran required a 

more subtle and expansive analysis:

Rather, Moran requires the court to use the law applicable in all contract 

cases to determine the meaning of a contract term and then, after 

looking at both that term in isolation and the contract as a whole, to 

decide (1) whether the covenant would negate the terms of the 

bargained-for clause; and (2) if not, whether application of the covenant 

is necessary to preserve the fruits of the contract and prevent it from 

being illusory. The two questions are related. Courts presume that 

parties do not make empty promises. When the implication of a duty of 

good faith and fair dealing would be inconsistent with the language of a 

provision of a contract and is not necessary to make the agreement 

meaningful, the court will not invoke the covenant. But where, by 

contrast, it is necessary to read an obligation of good faith in order to

avoid rendering a contract promise illusory—in the words of the cases, 

where necessary so as not to deprive a contracting party of the “fruits of 

the contract”—the courts will not hesitate to infer an obligation to act in 

good faith. A licensee granted the exclusive rights to sell the licensor’s 

products, for example, cannot automatically relieve itself of the 

obligation to exercise that contractual right in good faith by the simple

expedient of adding the language “sole discretion,” if the failure to act in 

good faith would render the contract illusory. See Advanced Water Techs. v. 

Amiad U.S.A., Inc., 457 F. Supp. 3d 313, 319–21 (S.D.N.Y. 2020). That 

is what was meant when Judge Cardozo long ago spoke of a contract 

right as being “instinct with an obligation.” Wood v. Lucy, Lady DuffGordon, 222 N.Y. 88, 118 N.E. 214, 214 (1917). No magic words can ipso 

description of an argument made by the plaintiff in the case. And here, we are not 

dealing with a boilerplate disclaimer of the duty but a contractual provision granting

Macquarie exclusive discretion to make a decision. The cases that we have cited make 

clear that a provision vesting a party with this level of discretion may disable a claim 

for the breach of the duty.
42

facto and without review of the contract as a whole relieve a contracting 

party of that obligation.

ThreeSixty, 520 F. Supp. 3d at 507.

Thus, we glean the following from the quotations provided from Goureau and 

ThreeSixty:

• New York applies the duty of good faith and fair dealing to contracts;

• The duty applies when a contract gives a party discretion in performing a 

duty under a contractual provision;

• Vesting a party with the sole discretion or a similar scope of discretion 

negates the existence of the duty; and

• The duty may still exist, even in the face of a provision vesting a party

with sole discretion, but to apply the duty in the face of such a provision

requires a two-pronged analysis of (1) whether the application of the 

duty negates the bargained-for discretion that the contractual provision

provides and (2) should the analysis indicate that the duty does not 

negate the bargained-for right, whether application of the duty is

necessary “to preserve the fruits of the contract and prevent it from 

being illusory.” ThreeSixty, 520 F. Supp. 3d at 507.
43

2. We describe the provisions of the Loan Agreement affecting

the Lender’s consent to the approval of prepayment of the 

Mezzanine Loan. 

We have already discussed in detail why we conclude that there was a

prepayment of the Mezzanine Loan as prepayment is defined in the Loan Agreement

and why the prepayment—structured as it was—triggered a default of the Loan

Agreement because there was no prior written consent to make the payment. 

The question of whether a duty of good faith and fair dealing impacted 

Macquarie’s ability to declare a default turns on the scope of the following provision

that both parties agree should be the primary focus of our analysis:

Section 12.2 Lender’s Discretion. Whenever pursuant to this 

Agreement Lender exercises any right given to it to approve or 

disapprove, or any arrangement or term is to be satisfactory to Lender, 

the decision of Lender to approve or disapprove or to decide whether 

arrangements or terms are satisfactory or not satisfactory shall (except as 

is otherwise specifically herein provided) be in the sole discretion of 

Lender and shall be final and conclusive. Prior to a Securitization, 

whenever pursuant to this Agreement the Rating Agencies are given any 

right to approve or disapprove, or any arrangement or term is to be 

satisfactory to the Rating Agencies, the decision of Lender to approve or 

disapprove or to decide whether arrangements or terms are satisfactory 

or not satisfactory, based upon Lender’s determination of Rating Agency 

criteria, shall be substituted therefore.

3. We conclude that the Loan Agreement negates the existence

of the duty of good faith and fair dealing.

The parties agree that the existence of a claim for the breach of the duty of 

good faith and fair dealing turns on an interpretation of Section 12.2. On its face, this 

provision is broad enough to embrace the question of prepayment with its language 
44

stating that when the “Lender exercises any right given to it to approve or disapprove, 

or any arrangement or term is to be satisfactory to Lender, the decision of Lender . . .

shall . . . be in the sole discretion of Lender and shall be final and conclusive.” The 

only argument that Appellant musters regarding why the provision should not negate 

the duty of good faith and fair dealing for consent to prepayment of the Mezzanine

Loan is that other sections of the Loan Agreement grant Macquarie sole and 

“absolute” discretion to take specific acts. From this, Appellant draws the argument 

that

[c]learly Macquarie knew how to draft the Agreement so as to give it 

“absolute” discretion for certain things, yet the absence of such a

provision for approving any alleged “prepayment” or “exercise” of the

parking[-]lot [o]ption demonstrates that Macquarie’s discretion with 

respect to those issues was not absolute and, therefore, was subject to 

the duty of good faith and fair dealing[,] i.e.[,] “not to act arbitrarily or 

irrationally in exercising that discretion.”

The argument begs the question of whether the level of discretion that Section 12.2 

vests in Macquarie is sufficient to negate a duty of good faith and fair dealing when it 

decided whether to consent to prepayment of the Mezzanine Loan. It is.

Appellant also tries to cabin the language of Section 12.2 by arguing that its

reference to “sole discretion” is not sufficient to grant Macquarie sufficient discretion

to overcome a claim of breach of the duty of good faith and fair dealing. Appellant

pitches its argument as follows: “That any discretion is solely that of Macquarie is not 

in dispute. But ‘sole’ discretion means just that; that any discretion is that of 

Macquarie’s and Macquarie’s alone. But that is an issue completely separate from the
45

scope of that discretion and whether that discretion is absolute.” There are two flaws 

in this argument. First, Goureau cites to ELBT Realty, 42 N.Y.S.3d at 306, in which a 

New York court rejected an “implied[-]covenant argument where [the] plain language 

of [the] contract gave termination discretion to [the] defendant in ‘its sole discretion.’” 

2021 WL 4847073, at *7.

And second, as Macquarie points out, Section 12.2 goes beyond granting it sole 

discretion and also provides that the discretion it exercises “shall be final and

conclusive.” Macquarie notes “final and conclusive” carries a meaning of terminal

and unappealable. Final, Black’s Law Dictionary (11th ed. 2019). Conclusive carries 

the meaning of authoritative; decisive; convincing. Conclusive, Black’s Law Dictionary 

(11th ed. 2019). Thus, Section 12.2 goes beyond stating that Macquarie acts with sole 

discretion and augments the provision with language that makes its decision the last 

word on the subject.

Undeterred by the breadth of the language giving Macquarie final and 

conclusive discretion, Appellant argues in its reply brief that the failure to use the 

word “absolute” in Section 12.2 when other sections of the Loan Agreement 

specifically provided that the Lender had absolute discretion impacts the analysis 

because different words have different meanings and because the Lender used 

absolute in some sections of the agreement and “final and conclusive” in Section 12.2,

that difference must have some significance. In Appellant’s view, “[g]iven the 

omission of the word ‘absolute,’ one cannot escape the conclusion that Macquarie 
46

enjoyed less-than-absolute discretion under ¶ 12.2 of the Agreement.” Of course, this

argument ignores that different words can carry the same meaning. Indeed, one

definition that Black’s Law Dictionary gives of the word “absolute” uses one of the 

words found in Section 12.2 with its definition of absolute as “conclusive and not liable 

to revision.” Absolute, Black’s Law Dictionary (11th ed. 2019) (emphasis added). For

this reason, we reject Appellant’s attempt to water down the degree of discretion vested 

in Macquarie because Section 12.2 has language that is different than other sections of 

the Loan Agreement when it uses words granting Macquarie unbridled discretion—a 

degree of discretion that usually negates the duty of good faith and fair dealing.

Next, we turn to ThreeSixty’s discussion of New York’s seminal opinion of 

Moran and its holding that the duty of good faith and fair dealing may exist even in the

face of a provision granting a party sole discretion to make a decision. 520 F. Supp. 

3d at 507. Appellant’s reference to Moran is passing at best when it states, “One of 

the key aspects of this implied promise is that ‘neither party shall do anything [that]

will have the effect of destroying or injuring the right of the other party to receive the 

fruits of the contract.’ Moran v. Erk, 11 N.Y.3d 452, 456 (N.Y. 2008).”

Looking to the specifics of the Moran analysis that Appellant fleetingly invokes,

we conclude that it does not apply here. Again, ThreeSixty described the analysis

mandated by Moran as

requir[ing] the court to use the law applicable in all contract cases to 

determine the meaning of a contract term and then, after looking at both 

that term in isolation and the contract as a whole, to decide (1) whether 
47

the covenant would negate the terms of the bargained-for clause; and 

(2) if not, whether application of the covenant is necessary to preserve 

the fruits of the contract and prevent it from being illusory.

ThreeSixty, 520 F. Supp. 3d at 507. To follow the path marked by ThreeSixty,

(1) Section 12.2 vests Macquarie with “final and conclusive” discretion to make 

decisions such as those regarding whether to consent to prepayment of the Mezzanine

Loan; (2) it would be a direct contradiction to the language of Section 12.2 to overlay

on it the duty of good faith and fair dealing on that Section—imposition of the duty

would negate the terms of the provision vesting the Lender with broad-ranging

discretion; and (3) even if our analysis in step 2 is incorrect, Appellant is not deprived

of the fruits of the contract unless the duty is imposed on the Lender when deciding 

whether to grant consent. Appellant had obtained the fruits of the contract when the 

financing was provided by the Lender. The consequence of Macquarie’s act was to 

increase the interest rate—an act that had a substantial financial impact on Appellant

but was not one that made Macquarie’s performance of the Loan Agreement illusory. 

To accept an argument that Moran negates the discretion vested in the Lender in

Section 12.2 would create an exception that swallowed the rule. The discretion 

created by Section 12.2 would be read out of the agreement when Appellant had 

obtained the lion’s share of the performance required by Macquarie but disagreed

with how Macquarie resolved the question of whether prepayment of the Mezzanine

Loan affected its position and prompted it to charge a post-default interest rate.
48

At bottom, we conclude that Section 12.2 of the Loan Agreement vests

sufficient discretion in Macquarie to negate a duty of good faith and fair dealing in 

deciding whether to consent to prepayment of the Mezzanine Loan. Under the 

circumstances of this case, the Moran analysis—that permits imposition of the duty 

even though sole discretion is vested to make the decision in question—does not apply.

We overrule Appellant’s Issue 1.d.

G. We accept Appellant’s argument that the Loan Agreement does 

not permit Macquarie to recover its attorneys’ fees and expenses

from Appellant.

In its second issue, Appellant attacks the trial court’s award of approximately

$1.5 million in attorneys’ fees to Macquarie. Appellant does not challenge the 

evidence that Macquarie offered to support the amount or the reasonableness of its

attorneys’ fees. But Appellant makes a more fundamental attack: Appellant in its 

Issue 2.a. asserts that no provision of the Loan Agreement permits Macquarie to 

recover its fees and that the existence of such a provision is a prerequisite to a fee 

recovery under New York law.10 Appellant underpins its argument with the 

contention that the provision of the Loan Agreement that Macquarie relied on in the 

trial court to obtain its fee recovery, when properly interpreted under New York law, 

provides no basis for Macquarie to shift its attorneys’ fees to Appellant. In

Appellant’s view, the provision addresses indemnity, and though under New York law 

10Our holdings obviate the need to address Appellant’s 2.b.(1) regarding 

whether Appellant did not oppose a request for attorneys’ fees as raised in 

Macquarie’s motion for summary judgment.
49

an indemnity provision may sometimes support an interparty fee claim, the provision 

relied on by Macquarie lacks the necessary clarity to accomplish that result. We agree 

with Appellant. But we first turn to Macquarie’s argument that Appellant waived its 

right to contest the fee recovery.

1. As a preliminary matter, we do not agree with Macquarie

that Appellant has waived its argument that Macquarie

cannot recover its attorneys’ fees.

Macquarie argues that Appellant has waived the issue of attorneys’ fees on

appeal by not challenging the ground raised in Macquarie’s motion for summary 

judgment—that the Loan Agreement permitted it to recover its fees. Macquarie

argues that its motion for summary judgment provided fair notice that one of the

motion’s grounds was that it was entitled to recover its attorneys’ fees. We reject the

waiver argument because Appellant filed a motion to reconsider whether the Loan

Agreement entitled Macquarie to recover its attorneys’ fees, and the trial court 

considered and ruled on that motion. Appellant raises an issue on appeal challenging 

the ruling on that motion. The ruling on the motion to reconsider and the issue 

challenging that ruling adequately postures the fee issue for our review. Further, 

Macquarie carried the burden to establish its fee claim on summary judgment as a 

matter of law; Appellant’s alleged failure in the trial court to challenge that the claim 

for attorneys’ fees was legally deficient does not free Macquarie from showing on 

appeal that it was entitled to that relief as a matter of law, i.e., Macquarie is not
50

entitled to a summary judgment by default simply because Appellant did not respond

to one of Macquarie’s summary-judgment grounds.

When Macquarie filed its motion seeking fees after the trial court had granted 

Macquarie’s motion for summary judgment, Appellant responded by arguing that the 

summary-judgment motion did not state a ground for the recovery of attorneys’ fees. 

But Appellant’s pleading also sought reconsideration of that ruling if the trial court 

determined that Macquarie’s motion had raised that ground. The order granting

Macquarie’s fee motion dealt with the motion to reconsider as follows:

Macquarie moved for summary judgment on its entitlement to fees and 

expenses under [Section] 12.13 of the Loan Agreement on pages five 

through six of its Motion for Summary Judgment. Specifically, 

Macquarie asked the court to order that it “is entitled to recover all of its 

fees and expenses, including expert expenses, under the terms of the 

parties’ Loan Agreement”—namely, [Section] 12.13(a). [Appellant] 

acknowledged Macquarie’s argument[] but did not oppose it on the

merits. The [c]ourt then granted Macquarie’s motion. Macquarie’s 

instant motion, and the subject of this order, is to determine the amount

[of] fees and expenses Macquarie should be awarded.

[Appellant] has asked the [c]ourt to reconsider its ruling on summary judgment 

that Macquarie is entitled to recover fees and expenses. The [c]ourt declines to do so, 

primarily because its ruling on summary judgment was correct: Section 12.13 of the 

Loan Agreement covers claims between the parties. [Emphasis added.]

Appellant’s second issue in Issue 2.b.(2) questions “whether the [t]rial [c]ourt erred as 

a matter of law in denying [Appellant’s] motion for reconsideration on this issue.”

When confronted with a motion to reconsider a summary judgment, the trial 

court has two options—disregard it or rule on its merits. If the trial court takes the 
51

latter course, the ruling on reconsideration may be reviewed on appeal. As the 

San Antonio Court of Appeals has explained,

When a motion for new trial is filed after the rendition of summary 

judgment, “a trial court has the discretion to consider the grounds in a 

post-judgment motion and supporting proof[] and reaffirm its summary 

judgment based on the entire record.” Timothy Patton, Summary 

Judgments in Texas § 7.06[1] (3d ed. 2012); see also Auten v. DJ Clark, Inc., 

209 S.W.3d 695, 702 (Tex. App.—Houston [14th Dist.] 2006, no pet.).

The trial court also has the discretion to simply deny a motion filed after 

the entry of summary judgment without considering its substance. First

Gibraltar Bank, FSB v. Farley, 895 S.W.2d 425, 430 (Tex. App.—San

Antonio 1995, writ denied). In the latter situation, an appellate court 

need only consider arguments and evidence presented prior to the 

summary-judgment hearing. Timothy Patton, Summary Judgments in 

Texas § 7.06[1] (3d ed. 2012); see also Laurel v. Herschap, 5 S.W.3d 799, 802 

(Tex. App.—San Antonio 1999, no pet.). “Thus, the efficacy of a postjudgment motion to preserve a complaint for appellate review depends 

upon whether the trial court affirmatively considers the new grounds 

and proof as memorialized by a written order.” Timothy Patton, 

Summary Judgments in Texas § 7.06[1] (3d ed. 2012) (citing Auten, 209 

S.W.3d at 701; Stephens v. Dolcefino, 126 S.W.3d 120, 133–34 (Tex. App.—

Houston [1st Dist.] 2003[), pet. denied, 181 S.W.3d 741 (Tex. 2005)]).

Charbonnet v. Shami, No. 04-12-00711-CV, 2013 WL 2645720, at *5 (Tex. App.—

San Antonio June 12, 2013, pet. denied) (mem. op.); see also Bauer v. Gulshan Enters.,

Inc., 617 S.W.3d 1, 21 (Tex. App.—Houston [1st Dist.] 2020, pet. denied) (op. on 

reh’g) (“When, as here, however, the trial court’s order affirmatively states that it 

considered the evidence attached to a motion to reconsider, we review the summary 

judgment based on the grounds and proof in both the prejudgment and post-judgment 

filings.”); PNP Petroleum I, LP v. Taylor, 438 S.W.3d 723, 729–30 (Tex. App.—San 

Antonio 2014, pet. denied) (applying the rule in Charbonnet to a motion to reconsider
52

filed with respect to a summary-judgment ruling and stating that when “the trial court 

affirmatively indicates on the record that it accepted or considered the evidence 

attached to a motion to reconsider, this court reviews ‘the summary judgment based 

upon the grounds and proof in both prejudgment and post-judgment filings’”).

As we read the trial court’s order, though the trial court denied Appellant’s 

motion to reconsider, it did consider the motion and reaffirm its ruling by noting that 

Appellant had filed a motion to reconsider but that “[t]he [c]ourt decline[d] to 

[reconsider its ruling], primarily because its ruling on summary judgment was correct: 

Section 12.13 of the Loan Agreement covers claims between the parties.” The import 

of this sentence is that the trial court had considered Appellant’s arguments on

whether the Loan Agreement provided for the recovery of attorneys’ fees and rejected 

those arguments. Simply on the issue of whether Appellant has preserved its 

argument on the fee issue for appeal, Appellant’s motion in combination with the trial 

court’s ruling convinces us that it has. Our holding comports with our duty to act 

liberally in determining whether an issue is preserved for appellate review. See, e.g., 

Arkoma Basin Expl. Co. v. FMF Assocs. 1990–A, Ltd., 249 S.W.3d 380, 388 (Tex. 2008)

(“Like all other procedural rules, those regarding the specificity of post-trial objections 

should be construed liberally so that the right to appeal is not lost unnecessarily.”).

Further, if Macquarie did raise in its summary-judgment motion the ground

that it was entitled to recover its fees, it bore the burden to establish that claim as a 

matter of law. See Tex. R. Civ. P. 166a. Even if Appellant failed to challenge that 
53

ground in its response, it still retained the ability on appeal to challenge whether

Macquarie established its fee claim as a matter of law—one aspect of which is whether

the Loan Agreement provided for the recovery of fees. Simply,

a non[]movant who fails to raise any issues in response to a summary[-] 

judgment motion may still challenge, on appeal, the legal sufficiency of 

the grounds presented by the movant. The nonmovant has no burden 

to respond to a summary[-]judgment motion unless the movant 

conclusively establishes its cause of action or defense. The trial court 

may not grant summary judgment by default because the nonmovant did 

not respond to the summary[-]judgment motion when the movant’s 

summary[-]judgment proof is legally insufficient.

Amedisys, Inc. v. Kingwood Home Health Care, LLC, 437 S.W.3d 507, 512 (Tex. 2014)

(internal citation and quotation marks omitted) (quoting Rhone–Poulenc, Inc. v. Steel, 997 

S.W.2d 217, 222–23 (Tex. 1999)). Thus, the failure to challenge the ground by which

Macquarie sought its fees does not foreclose Appellant’s argument that Macquarie

failed to establish that ground as a matter of law.

2. We set out the principles enunciated by New York courts11

to determine whether an indemnity provision permits an 

interparty fee recovery.

The parties agree that the bellwether opinion of the New York Court of 

Appeals on the question of whether the Loan Agreement has a provision that permits 

11Macquarie predicated its claim for fees on the Loan Agreement. Thus, the 

Agreement’s choice of law provision selecting New York law governs. Midwest Med.

Supply Co. v. Wingert, 317 S.W.3d 530, 537 (Tex. App.—Dallas 2010, no pet.) (“A claim 

for attorneys’ fees for breach of contract is not an independent cause of action. We 

have recognized that the recovery of attorneys’ fees for breach of a contract is a 

substantive, not a procedural, issue and will be governed by the law governing the 

substantive issues.”).
54

Macquarie’s fee recovery is Hooper Associates, Ltd. v. AGS Computers, Inc., 548 N.E.2d 

903 (N.Y. 1989). Hooper stated the general rule of fee recovery as “attorney’s fees are

incidents of litigation and a prevailing party may not collect them from the loser 

unless an award is authorized by agreement between the parties, statute[,] or court 

rule.” Id. at 904. Hooper then examined the question of whether a hold-harmless 

provision that permitted the recovery of fees “is limited to attorney’s fees incurred by

plaintiff in actions involving third parties or also includes those incurred in

prosecuting a suit against defendant for claims under the contract.” Id.

Noting that a contract had to be read in view of “the particular object [that] the 

parties had in view” and that this principle had special sway for indemnity contracts, 

Hooper held that “[w]hen a party is under no legal duty to indemnify, a contract 

assuming that obligation must be strictly construed to avoid reading into it a duty 

[that] the parties did not intend to be assumed.” Id. at 905. To ensure that the 

language of an indemnity/hold-harmless provision was not expanded to permit loose

language in the provision to swallow the rule restricting the recovery of fees, Hooper 

articulated the following interpretive principle for resolving the question of whether 

an indemnity/hold-harmless provision embraced an interparty fee claim:

Inasmuch as a promise by one party to a contract to indemnify the other 

for attorney’s fees incurred in litigation between them is contrary to the

well-understood rule that parties are responsible for their own attorney’s

fees, the court should not infer a party’s intention to waive the benefit of 

the rule unless the intention to do so is unmistakably clear from the 

language of the promise[.]
55

Id.

Hooper concluded that the indemnity provisions that it had reviewed did not 

include interparty fee claims because “[n]one are exclusively or unequivocally referable 

to claims between the parties themselves or support an inference that defendant

promised to indemnify plaintiff for counsel fees in an action on the contract.” Id. 

Hooper buttressed its holding that the indemnity/hold-harmless provisions did not 

embrace interparty fee claims by noting that several of the contract’s other provisions

provided for matters such as notice that the claim was being made and an assumption

of defense; Hooper concluded that these provisions would be surplusage if read to 

extend “the indemnification clause to require defendant to reimburse plaintiff for 

attorney’s fees in the breach[-]of[-]contract action against defendant.” Id.

A later New York Court of Appeals decision distilled Hooper’s holding and 

concluded that the following contract provision did not exhibit the necessary clarity to 

permit an interparty fee recovery when it provided for reimbursement of “charges, 

fees, costs[,] and expenses[,] . . . including reasonable attorneys’ . . . fees and expenses,

in connection with . . . the enforcement, defense[,] or preservation of any rights in

respect of any of the Operative Documents, including defending, monitoring[,] or 

participating in any litigation or proceeding . . . relating to any of the Operative 

Documents.” Ambac Assurance Corp. v. Countrywide Home Loans, Inc., 106 N.E.3d 1176, 

1180 (N.Y. 2018). The provision failed to satisfy the clarity required by Hooper

because “the subjects set forth in this provision are all ‘susceptible to third-party 
56

claims,’ and ‘[n]one are exclusively or unequivocally referable to claims between the 

parties themselves’ . . . . Accordingly, there is no unmistakable promise to reimburse 

attorneys’ fees in a case brought by” the party entitled to reimbursement under the 

quoted contractual provision. Id. at 1186 (quoting Hooper, 548 N.E.2d at 905). 

Not unexpectedly, the devil lies in the details of when a provision

unequivocally refers to an interparty fee recovery. The premises used by different 

courts to assess the clarity needed by a provision have not, in our view, been totally

consistent. One court emphasized that “the requirement that parties express their 

intent with ‘unmistakable clarity’ is not the same as a ‘magic words’ test, and courts 

have interpreted indemnification provisions to cover litigation expenses between the 

parties even where that coverage was not explicitly mandated in such words but, 

nonetheless, the intent was clear.” Carbonyx License & Lease LLC v. Carbonyx Inc., No. 

19-cv-1540 (JSR), 2019 WL 6701910, at *8 (S.D.N.Y. Dec. 9, 2019) (mem. order) 

(citing Mid-Hudson Catskill Rural Migrant Ministry, Inc. v. Fine Host Corp., 418 F.3d 168, 

178 (2d Cir. 2005)). Another court’s approach seemed to come close to establishing 

that magic words are indeed needed:

The bottom line is that a contract provision employing the language of 

third-party claim indemnification may not be read broadly to encompass 

an award of attorney’s fees to the prevailing party based on the other 

party’s breach of the contract; the provision must explicitly so state. 

The Hooper standard requires more than merely an arguable 

inference of what the parties must have meant; the intention to 

authorize an award of fees to the prevailing party in such 

circumstances must be virtually inescapable.
57

Gotham Partners, L.P. v. High River Ltd. P’ship, 906 N.Y.S.2d 205, 209 (N.Y. App. Div. 

2010) (bolded and underlined emphasis added).

Certain New York courts adopt a seemingly hybrid approach that relies on 

contextual clues to augment the textual analysis. One court summarized this

approach as follows:

In applying this standard of unmistakable clarity, the courts have 

generally declined to infer indemnification obligations arising from an 

indemnitee/indemnitor suit if the contractual language does not 

expressly refer to or explicitly contemplate such circumstances and the 

context does not suggest that the contracting parties were specifically 

concerned with prospective litigation between themselves.

Luna v. Am. Airlines, 769 F. Supp. 2d 231, 244 (S.D.N.Y. 2011); see also Thor 725 8th 

Ave. LLC v. Goonetilleke, No. 14 CIV. 4968 (PAE), 2015 WL 8784211, at *4 (S.D.N.Y. 

Dec. 15, 2015) (opinion and order) (following and applying Luna test); Shah v. 20 E.

64th St., LLC, 154 N.Y.S.3d 6, 21 (N.Y. App. Div. 2021) (holding that indemnity

provision included interparty fee claim because of highly inclusive language in

provision and no other provision of agreement would be rendered meaningless if 

provision read to include interparty claims).

Luna cataloged the contextual clues that guided its analysis:

When an indemnification agreement contains provisions that appear to

be inapplicable to suits between the contracting parties—such as 

requiring that notice of a claim be given to the indemnitor or allowing 

the indemnitor to assume the indemnitee’s defense—the courts have 

concluded that the contract does not evidence an unmistakably clear 

intent to indemnify attorney’s fees incurred in a lawsuit between the 

contracting parties.
58

In contrast, when the language of an indemnification provision 

specifically evidences the parties’ intent to cover claims by contracting 

parties, indemnification for suits against the indemnitor will be enforced. 

For instance, when confronted with indemnification provisions that 

include both broad indemnity clauses and narrower clauses that 

specifically target third-party claims, courts have determined that the

broad provisions cover claims between the contracting parties, thereby 

ensuring that neither clause is superfluous.

Absent specific contractual language authorizing indemnification 

in suits between the contracting parties, the courts may still determine 

that the parties intended for such indemnification based on clear 

contextual evidence. Thus[,] the court will enforce such an obligation if 

it is apparent that at the time of contracting the parties had no reason to 

anticipate the possibility of the indemnitee being faced with third-party 

claims. . . .

By comparison, if third-party claims were possible at the time of 

contracting and the contractual language did not evidence the parties’

intent regarding the indemnification of attorney’s fees incurred in suits 

between them, the courts have refused to award such expenses as 

indemnification.

769 F. Supp. 2d at 244–45 (citations omitted).

3. We set forth the provision of the Loan Agreement that 

Macquarie relies on to support its fee claim.

Macquarie predicates its fee claim on a single provision of the Loan Agreement. 

It relies on Section 12.13 that is titled “Expenses; Indemnity.” This section contains 

six subsections, but Macquarie relies on only one of them. Placing the operative

subsection, which we have italicized below, in context with the introductory and 

concluding clauses of the section, the provision reads as follows:

Borrower shall pay or, if Borrower fails to pay, reimburse Lender upon 

receipt of notice from Lender, for all reasonable costs and expenses 

(including reasonable attorneys’ fees and disbursements) incurred by 
59

Lender in connection with . . . (v) enforcing or preserving any rights, in response 

to third[-]party claims or the prosecuting or defending of any action or proceeding or 

other litigation or otherwise, in each case against, under[,] or affecting Borrower, any 

other Borrower Party[,] or any Affiliate of Borrower, this Agreement, the other Loan

Documents, the Property, the Other Collateral[,] or any other security given for the

Loan . . . provided, however, that Borrower shall not be liable for the 

payment of any such costs and expenses to the extent the same arise by 

reason of the gross negligence, illegal acts, fraud[,] or willful misconduct 

of Lender. [Emphasis added.]

Our focus is on this provision alone; neither party points us to any other provisions of 

the Loan Agreement that might create the contextual clues that we have enumerated

from Luna.

4. We agree with Appellant that Section 12.13 does not entitle 

Macquarie to recover its fees for prosecuting and defending

its claims against Appellant.

We agree with Appellant that Section 12.13 lacks the clarity that it needs to 

support an interparty fee claim. Though there is an arguable interpretation of the 

section that supports the reading advocated for by Macquarie, that reading does not 

meet the standard articulated by New York’s court of last resort that the reference be

“exclusively or unequivocally referable to claims between the parties themselves.” See 

Hooper, 548 N.E.2d at 905.

Before explaining our rationale, we detail one of Appellant’s arguments that we 

reject. Appellant places great emphasis on the fact that the Loan Agreement does not

contain a standard fee provision that might look familiar to Texas lawyers. But that 

argument begs the question because the question is not what the Loan Agreement did 

not include but whether the section that it did include satisfies the Hooper standard.
60

And, again, neither party mentions the Luna principles that look to various 

textual clues to clarify the scope of the fee provision. The parties do not point us to 

provisions of the Loan Agreement that would be rendered surplusage or suggest that 

it would be “apparent that at the time of contracting the parties had no reason to

anticipate the possibility of the indemnitee being faced with third-party claims.” See 

Luna, 769 F. Supp. 2d at 244.

Here, the argument focuses on whether subsection (a)(v) of Section 12.13 

covers both third-party and interparty claims. This argument is crystalized in 

Macquarie’s brief as follows:

Here too, [Section] 12.13 of the Loan Agreement distinguishes thirdparty claims from claims between the parties and must be interpreted as 

covering both. [Appellant] is correct that [Section] 12.13(a)(v) first 

addresses costs and expenses incurred in connection with “enforcing or 

preserving any rights, in response to third[-]party claims.” But that same 

section also covers costs and expenses incurred “prosecuting or 

defending of any action or proceeding or other obligation or otherwise, 

in each case against, under[,] or affecting Borrower, any other 

Borrower Party[,] or any Affiliate of Borrower, this Agreement, the 

other Loan Documents, the Property, the Other Collateral[,] or any 

other security given for the loan.” Section 12.13 of the Loan Agreement 

therefore covers claims between the parties, and the trial court correctly 

awarded Macquarie its reasonable attorneys’ fees and expenses. See, e.g.,

Mid-Hudson Catskill Rural Migrant Ministry . . . , 418 F.3d [at] 178–79 . . .

(distinguishing provision indemnifying a party for certain actions 

“brought by third parties” from one covering “actions of any kind or

nature arising, growing out of, or otherwise connected with any activity

under this Agreement”). [Brief and record references omitted.]

Certainly, Section 12.13 describes actions “prosecuting or defending” matters 

“against . . . or affecting” the borrower, and this suit was such. But the open question
61

is whether the section can be interpreted to include a suit by Macquarie against

Appellant simply because a literal interpretation is broad enough to support 

Macquarie’s construction. The phrases Macquarie relies on are pregnant with the 

possibility that they include such claims but do not carry that possibility to fruition 

with the necessary clarity to meet the Hooper standard; the provision never explicitly

states that a suit brought by Macquarie against Appellant falls within its ambit.

Appellant argues, and we agree, that Section 12.13’s language parallels the 

provision examined in Ambac that provided for the recovery of “charges, fees, costs[,]

and expenses[,] . . . including reasonable attorneys’ . . . fees and expenses, in 

connection with . . . the enforcement, defense[,] or preservation of any rights in 

respect of any of the Operative Documents, including defending, monitoring[,] or 

participating in any litigation or proceeding . . . relating to any of the Operative 

Documents.” 106 N.E.3d at 1180. If literally interpreted, this language seems to hold

a possible interpretation that would allow an interparty fee recovery. Even so, the 

New York Court of Appeals found that it failed to carry the unmistakable promise 

necessary to support that claim. Id. at 1186.

Macquarie also places emphasis on the fact that Section 12.13 is broken down 

into two sections—one dealing with expenses and the other indemnity. Specifically, 

Macquarie argues,

[Section] 12.13, which is titled “Expenses; Indemnity” and not just 

“indemnity[,”] has two parts. Section 12.13(b), which starts with 

“Borrower shall indemnify,” is the indemnification provision. Section 
62

12.13(a), on the other hand, covers expenses; it requires [Appellant] to 

pay or reimburse Macquarie for reasonable “costs and expenses” incurred, 

“including reasonable attorneys’ fees” incurred in “prosecuting or 

defending of any action or proceeding . . . against, under[,] or affecting”

[Appellant]. [Record references omitted.]

But, again, Ambac had a provision that was also phrased in terms of reimbursement 

but still applied the rule of Hooper to conclude that the provision lacked the necessary 

clarity. Id. at 1180, 1186. Thus, the court of last resort in New York does not appear 

to see the material distinction advocated for by Macquarie simply because the

provision deals with reimbursement.

We sustain Appellant’s Issue 2.a. and hold as a matter of law that Macquarie 

cannot recover its attorneys’ fees and expenses from Appellant because Section 12.13 

cannot be interpreted as having the necessary clarity to create that claim. See id. For 

the same reason, we also sustain Appellant’s Issue 2.b.(2), in which Appellant 

contends that the trial court erred by denying its motion for reconsideration on the 

issue of Macquarie’s ability to recover attorneys’ fees.

IV. Conclusion

We have overruled the portions of Appellant’s first issue that challenge the trial 

court’s grant of summary judgment that Appellant recover nothing on its claims that 

Macquarie breached the Loan Agreement by declaring a default because the 

Mezzanine Loan was prepaid without its written consent and that Macquarie owed 

Appellant a duty of good faith and fair dealing. We have also concluded that 

Appellant has waived the portion of its first issue claiming that a fact question exists 
63

regarding whether Macquarie consented to the prepayment of the Mezzanine Loan. 

Our resolution of these issues obviates the need to address whether Appellant also

defaulted on the Loan Agreement by its exercise of a parking-lot option or whether 

Macquarie’s public statements that the loan was in default devalued the hotel. Thus, 

we affirm the portion of the trial court’s judgment that Appellant recover nothing on 

its claims against Macquarie. However, we hold that there is an error in the trial

court’s judgment because having sustained Appellant’s second issue, we reverse the 

trial court’s judgment awarding Macquarie its attorneys’ fees and expenses; Section 

12.13 of the Loan Agreement cannot be read as having the requisite clarity to entitle 

Macquarie to that recovery. Accordingly, we render judgment that Macquarie take 

nothing on its fee claim.

/s/ Dabney Bassel

Dabney Bassel

Justice

Delivered: August 31, 2022