Opinion issued November 17, 2015

In The

Court of Appeals 

For The 

First District of Texas 

————————————

NO. 01-15-00169-CV

———————————

STEWART BEACH CONDOMINIUM 

HOMEOWNERS ASSOCIATION, INC., Appellant

V.

GILI N PROP INVESTMENTS, LLC; 

BARAK RESHEFF; BARYO INVESTMENTS, LLC; 

SIMCA HELED; AHUVA HALED; PAVEL 

(LEONID) GORBULSKY; AND RAMI BARNEA, Appellees

On Appeal from the 122nd District Court

Galveston County, Texas

Trial Court Case No. 14-CV-1266

O P I N I O N

Four condominium owners obtained temporary injunctions to prohibit 

Stewart Beach Condominium Homeowners Association from foreclosing on their 
2

condominiums. Stewart Beach appeals the trial court’s denial of its motion to 

dissolve the four temporary injunctions.

1 Stewart Beach argues: (1) the temporary 

injunction orders do not meet the requirements of Texas Rule of Civil Procedure 

683; (2) Gili N Prop Investments, LLC, Baryo Investments LLC, Rami Barnea, 

Simca and Ahuva Heled, and Pavel Gorbuslski (collectively referred to as the 

“homeowners”) did not meet their burden to prove the elements of a temporary 

injunction; and (3) the homeowners had “unclean hands” and thus were barred 

from seeking temporary injunctions. The homeowners argue that we do not have 

jurisdiction over this appeal. We affirm.

Background

Stewart Beach is a homeowner’s association. It charged the homeowners 

assessments for community maintenance ranging from $3,500 to $6,200—

assessments that the homeowners admit they owe. Stewart Beach’s demand

included an amount for its attorney’s fees incurred during its assessment-collection 

efforts. The homeowners contest the amount of the attorney’s fees demanded, 

claiming the fees were excessive, unconscionable, and unauthorized by the 

association agreement. They paid neither the assessment nor the attorney’s fee 

demand. Because the homeowners did not pay the amount demanded, Stewart 

 1 See TEX. CIV. PRAC. & REM. CODE ANN. § 51.014(a)(4) (West 2015) (granting 

courts of appeals jurisdiction over interlocutory appeals of orders “grant[ing] or 

overrul[ing] a motion to dissolve a temporary injunction”)
3

Beach attempted to foreclose on their condominiums. The homeowners sought, 

and the trial court granted, temporary injunctions to avoid foreclosure.

A. Attorney fee agreement

The engagement letter between Stewart Beach and its attorney provides for a 

hybrid attorney fee consisting of three parts: (1) a flat fee of $75 for “[c]ollection 

cure letters” and $225 for filing notices of liens; (2) a contingency fee “equal to 

20% on all collections”; and (3) an hourly fee of $195 for the attorney’s work and 

$65 for his paralegal’s work.

B. Attorney’s work on the case

Stewart Beach’s attorney mailed a form collection cure letter to each of the 

homeowners. The boilerplate, form letter merely plugged in information he 

received from his client, Stewart Beach. The attorney also filed liens—again using 

boilerplate forms—against each of the homeowners. His paralegal prepared these 

two documents, which the attorney reviewed.

Stewart Beach’s attorney demanded in the “collection cure” letter that the 

homeowners pay his attorney’s fees ranging from $1,600 to $2,150. No calculation 

or description of the time or services was included in the demand letter. Testimony 

during the temporary-injunction hearing revealed that the fee included: (1) $300 

for the two documents prepared by the paralegal, (2) $585 for hourly charges, and 
4

(3) an amount that represents 20% of the uncollected assessments. For all four 

homeowners, the total demanded for attorney’s fees was over $16,000.

C. Lawsuit against homeowners

Stewart Beach sued the homeowners for breach of contract and attempted to 

foreclose on their condominiums. In the homeowners’ answer to Stewart Beach’s 

lawsuit, they admitted they owe some assessments but argued that the attorney’s

fees were excessive. They raised counterclaims for fraudulent liens2 and excessive 

demand.3

 2 Texas law imposes liability for a fraudulent lien when a person files a lien with:

(1) knowledge that the document or other record is a fraudulent 

court record or a fraudulent lien or claim against real or 

personal property or an interest in real or personal property;

(2) intent that the document . . . be given the same legal effect as a 

court record . . . evidencing a valid lien or claim against real or 

personal property or an interest in real or personal property; and

(3) intent to cause another person to suffer:

(A) physical injury;

(B) financial injury; or

(C) mental anguish or emotional distress.

TEX. CIV. PRAC. & REM. CODE ANN. § 12.002 (West Supp. 2014).

3 The excessive demand doctrine tempers the right of the claiming party to recover 

attorney’s fees. Wayne v. A.V.A. Vending, Inc., 52 S.W.3d 412, 417–18 (Tex. 

App.—Corpus Christi 2001, pet. denied); Allstate Ins. Co. v. Lincoln, 976 S.W.2d 

873, 878 (Tex.App.—Waco 1998, no writ). This doctrine recognizes that, “[i]f the 

claiming party makes an unreasonable demand, the other party should not be 

forced to pay the demand or else risk suffering the opposing party’s attorney’s 

fees.” Wayne, 52 S.W.3d at 417–18; see Fire & Cas. Ins. Co. of Connecticut v. 

Buslease, Inc., No. 08-01-00277-CV, 2002 WL 1301570, at *2 (Tex. App.—El 

Paso June 13, 2002, pet. denied) (mem. op., not designated for publication). If the 

trial court determines that the attorney’s fees Stewart Beach demanded were 

excessive and therefore “unreasonable” or demanded “in bad faith,” the trial court 

could limit the award of attorney’s fees. Oyster Creek Fin. Corp. v. Richwood 
5

D. Temporary injunction

After an evidentiary hearing, which included testimony by Stewart Beach’s 

attorney on his fees and testimony by the homeowners’ expert that the fees were 

“clearly excessive,” “unreasonable,” and “unconscionable,” the trial court granted 

four temporary injunctions, one for each of the four units.

Each of the orders granting a temporary injunction found that “there are 

unpaid assessments against the property” and that the “reasonable and necessary 

attorney’s fees and costs . . . are $300”—the amount set forth in the engagement 

letter for the demand letter and lien. The orders also found that the “owner will 

suffer imminent and irreparable harm if this Court does not enjoin the foreclosures 

of the Property.” The orders set a bond at the amount of the assessment plus the 

$300 in attorney’s fees. 

 

Invs. II, Inc., 176 S.W.3d 307, 318 (Tex. App.—Houston [1st Dist.] 2004, pet. 

denied); Alford v. Johnston, 224 S.W.3d 291, 298–99 (Tex. App.—El Paso 2005, 

pet. denied); Pennington v. Gurkoff, 899 S.W.2d 767, 772 (Tex. App.—Fort 

Worth 1995, writ denied). But, if the trial court does not find the original fee 

demand to be excessive, this continuing controversy subjects the homeowners to 

claims for the additional attorney’s fees in this appeal and for the continued 

proceedings in the trial court. Thus, the ultimate recovery for attorney’s fees could 

potentially be higher than the original claimed amount because of the 

accumulating attorney’s fees. See Thomas v. Lake Cove Cmty. Ass’n, Inc., No. 14-

13-00173-CV, 2014 WL 1004525 (Tex. App.—Houston [14th Dist.] Mar. 13, 

2014, no pet.) (mem. op.) (noting that association initially spent $2,314 in 

attorney’s fees but after trial recovered $4,952 in attorney’s fees because of 

additional services).
6

Stewart Beach then filed a motion to dissolve the temporary injunctions, 

which the trial court denied. Stewart Beach now appeals the trial court’s denial of 

its motion to dissolve.

Standard of Review

We review a trial court’s decision to grant or deny a motion to dissolve a 

temporary injunction under an abuse of discretion standard. Conlin v. Haun, 419 

S.W.3d 682, 686 (Tex. App.—Houston [1st Dist.] 2013, no pet.). A trial court has 

broad discretion in denying or granting such a motion. Id. “A trial court abuses its 

discretion only if it reaches a decision so arbitrary and unreasonable that it amounts 

to a clear and prejudicial error of law or if it clearly fails to correctly analyze or 

apply the law.” Id. (citing Intercontinental Terminals Co. v. Vopak N. Am., Inc.,

354 S.W.3d 887, 892 (Tex. App.—Houston [1st Dist.] 2011, no pet.)). We only 

review the validity of the temporary injunction order; we do not review the merits 

of the underlying case. INEOS Grp. Ltd. v. Chevron Phillips Chem. Co., 312 

S.W.3d 843, 848 (Tex. App.—Houston [1st Dist.] 2009, no pet.). We review the 

evidence in the light most favorable to the district court’s ruling, drawing all 

legitimate inferences from the evidence and deferring to the district court’s 

resolution of conflicting evidence. Id. A district court abuses its discretion if it 

misapplies the law to established facts. Id. There is no abuse of discretion as long 
7

as some evidence reasonably supports the district court’s decision. Butnaru v. Ford 

Motor Co., 84 S.W.3d 198, 211 (Tex. 2002). 

When a party challenges a finding of fact, like Stewart Beach does here, the 

finding is not determinative unless it is supported by the record. Brejon v. Johnson, 

314 S.W.3d 26, 30 (Tex. App.—Houston [1st Dist.] 2009, no pet.). We review the 

sufficiency of the evidence to determine whether the trial court abused its 

discretion in making the finding. Id. The “legal and factual sufficiency of the 

evidence are not independent grounds for asserting error, but they are relevant 

factors in assessing whether the trial court abused its discretion.” Dunn v. Dunn, 

177 S.W.3d 393, 396 (Tex. App.—Houston [1st Dist.] 2005, pet. denied). “A trial 

court does not abuse its discretion when there is some evidence of a substantive 

and probative character to support the trial court’s judgment.” Miles v. Peacock, 

229 S.W.3d 384, 389 (Tex. App.—Houston [1st Dist.] 2007, no pet.).

Jurisdiction

The homeowners argue, “The Court of Appeals is without Jurisdiction . . . 

because the Notice of Appeal was filed more than 20 days after the Orders 

complained of, and the subsequent Motion to Dissolve the Injunctions raised [no] 

new grounds and was ineffective to renew appellate jurisdiction.” 

“The interlocutory appeal of an order denying a motion to dissolve a 

temporary injunction is an accelerated appeal, and accordingly, the notice of appeal 
8

must be filed within 20 days of the date of the order denying the motion.” Conlin, 

419 S.W.3d at 685. The statute granting us jurisdiction to hear an interlocutory 

appeal allows an appeal from either an order that “grants or refuses a temporary 

injunction” or one that “grants or overrules a motion to dissolve a temporary 

injunction.”4 TEX. CIV. PRAC. & REM. CODE ANN. § 51.014. An appeal “must be 

filed within 20 days after the judgment or order is signed.” TEX. R. APP. P. 26.1(a).

The 20-day time period to appeal an order granting or overruling the motion to 

dissolve a temporary injunction starts on the day of the order appealed—even if 

that order is not the first order granting or denying such a motion in the lawsuit. 

See Conlin, 419 S.W.3d at 685 (holding appeal was timely because within time 

period for second—but not first—motion to dissolve).

Stewart Beach appeals the trial court’s denial of its motion to dissolve the 

temporary injunction. It filed the notice of appeal three days after the trial court 

denied its motion to dissolve—well within the 20-day limit. 

 4 The homeowners argue that the statute’s wording, “grants or refuses a temporary 

injunction or grants or overrules a motion to dissolve a temporary injunction as 

provided by Chapter 65,” indicates the statute only grants us appellate jurisdiction 

over dissolution of injunctions for damages. TEX. CIV. PRAC. & REM. CODE ANN.

§ 51.014 (West 2015). We disagree. While the one subsection of Chapter 65 the 

homeowners cite deals with “injunction[s] enjoining the collection of money,” the 

entirety of the chapter gives a trial court jurisdiction to grant injunctions “of equity 

. . . if not in conflict with this chapter or other law.” TEX. CIV. PRAC. & REM.

CODE ANN. §§ 65.001, 65.031 (West 2008). Thus the language “as provided by 

Chapter 65” refers to any injunction “of equity” and grants us jurisdiction to hear 

an appeal of any such injunction or of a motion to dissolve such an injunction.
9

The homeowners claim that the motion to dissolve the temporary injunction 

was “pro forma” and “merely reiterates” the arguments against the temporary 

injunction that Stewart Beach made at the temporary injunction hearing. They cite 

City of Houston v. Estate of Jones in arguing that “merely reiterating” such 

arguments is “not effective” to “extend the appellate deadline” and contend that the 

20 days commenced with the granting of the temporary injunction. 388 S.W.3d 

663 (Tex. 2012). 

Estate of Jones does not support the homeowners for two reasons. First, it 

dealt with a plea to the jurisdiction. In that case, the City of Houston, two years 

after it filed its original plea to the jurisdiction, filed a second plea to the 

jurisdiction containing the same arguments as the original plea. Id. at 665. The 

Texas Supreme Court agreed with the trial court in construing the new “plea” as a 

motion to reconsider. Id. at 666. Because the statute allowing interlocutory appeals 

did not provide for an appeal of a motion to reconsider a plea to the jurisdiction, 

the Texas Supreme Court held it did not have jurisdiction over an appeal of the 

denial of the motion. Id. at 667. An order denying a motion to dissolve a temporary 

injunction is different: the statute authorizing interlocutory appeals specifically 

allows appeal of such an order—unlike a motion to reconsider a plea to the 

jurisdiction. 
10

Second, unlike Estate of Jones, the motion here raised new grounds for 

relief. The motion to dissolve argues that the temporary injunction order does not 

meet the requirements of the Rules of Civil Procedure, specifically the requirement 

that the order “set forth the reasons for its issuance,” and thus, the order is “void” 

and the trial court had “no discretion to deny a motion to dissolve.” These 

arguments were not raised at the temporary injunction hearing; indeed, such 

arguments could not have been raised there because Stewart Beach could not 

challenge the form of the order before it was issued.

Thus, Stewart Beach’s appeal is timely and we have jurisdiction over it.

The Temporary Injunction Order Satisfies the Requirements 

of Texas Rule of Civil Procedure 683

Stewart Beach argues that the four temporary injunction orders “do not set 

out the reasons for entry or identify the harm [the homeowners] will suffer if not 

entered” and thus violate the requirements of Texas Rule of Civil Procedure 683.5

That rule requires: “Every order granting an injunction . . . shall set forth the 

reasons for its issuance; shall be specific in terms; shall describe in reasonable 

detail . . . the act or acts sought to be restrained; and

 5 Stewart Beach also argues that the orders violated Rule 684, which requires the 

court to “fix the amount of security to be given by the applicant” for a temporary 

injunction, but Stewart Beach does not give any detail on how that Rule is 

violated. This “[f]ailure to cite legal authority or to provide substantive analysis of 

the legal issues presented results in waiver of the complaint.” Canton-Carter v. 

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

2008, no pet.).
11

. . . shall include an order setting the cause for trial on the merits with respect to the 

ultimate relief sought.” TEX. R. CIV. P. 683.

The four orders granting the temporary injunctions, which are identical 

except for the name of the homeowner and the amount of the assessment and bond,

meets the four requirements of Rule 683. First, the orders set forth the reasons for 

their issuance. The order states “After considering[] the pleadings, testimony, 

exhibits, [and] other evidence properly before the Court, legal authorities, and the 

argument of counsel, the Court: FINDS there are unpaid assessments against the 

Property [and] FINDS the reasonable and necessary attorney’s fees and costs 

incurred by the Association to make the demand to the Owner and file the lien 

against the Property are $300.00.”

Second, the orders identify the harm that the homeowners would suffer if 

Stewart Beach foreclosed on the condominiums. It states that the trial court 

“FINDS the Owner will suffer imminent and irreparable harm if this Court does 

not enjoin the foreclosures of the Property, currently scheduled to occur on 

Tuesday, January 6, 2015 at 10:00 a.m.” The harm of losing one’s home “is 

obvious”; a homeowner would “probably be injured if the property were foreclosed 

and sold.” Franklin Sav. Ass’n v. Reese, 756 S.W.2d 14, 15–16 (Tex. App.—

Austin 1988, no writ).
12

Third, the order sets out the act to be restrained: it “ORDERS [that Stewart 

Beach be] . . . TEMPORARILY ENJOINED from conducting any foreclosure by 

private sale or otherwise of the Property until and pending signature and entry of 

final resolution of this suit or until further order of this Court.” 

Fourth, the order sets a date for the trial on the merits.6 Thus, the orders

granting the temporary injunctions in this case meet the requirements of Rule 683. 

We overrule Stewart Beach’s first issue.

Temporary Injunction

A temporary injunction “preserve[s] the status quo of the litigation’s subject 

matter pending a trial on the merits.” Butnaru, 84 S.W.3d at 204. The “status quo” 

is the “last, actual, peaceable, noncontested status which preceded the pending 

controversy.” In re Newton, 146 S.W.3d 648, 651 (Tex. 2004) (internal quotation 

marks omitted). “To obtain a temporary injunction, the applicant must plead and 

prove three specific elements: (1) a cause of action against the defendant; (2) a 

 6 This differs from the cases Stewart Beach cites in which the appeals court held 

that the temporary injunction order did not meet the requirements of Rule 683 

because the order did not set a date for the trial on the merits. See Interfirst Bank 

San Felipe v. Paz Constr. Co., 715 S.W.2d 640, 641 (Tex. 1986) (holding order 

violated Rule 683 because it did not set date for trial on merits); Conlin, 419 

S.W.3d at 687 (same). The two other cases Stewart Beach cites are not helpful to 

deciding this issue because neither discusses the requirements of Rule 683. See

Qwest Commc’ns Corp. v. AT&T Corp., 24 S.W.3d 334 (Tex. 2000) (holding that 

order granting temporary injunction is appealable); Tex. State Optical v. Wiggins, 

882 S.W.2d 8 (Tex. App.—Houston [1st Dist.] 1994, no writ) (holding trial court 

applied wrong law to facts in case).
13

probable right to the relief sought; and (3) a probable, imminent, and irreparable 

injury in the interim.” Butnaru, 84 S.W.3d at 204.

Stewart Beach challenges the second and third elements: it argues that it is 

“impossible” for the homeowners to obtain relief and that the homeowners would 

not suffer an irreparable injury if the foreclosures were to proceed because other 

remedies exist for them.

A. Probable right to the relief sought

Stewart Beach argues, “It is impossible for [the homeowners] to show they 

will succeed on the merits of the case because they confess in their pleadings they 

owe . . . the amount [Stewart Beach] pled.”

When a trial court holds a hearing on a temporary injunction, the only 

question “is whether the applicant is entitled to preservation of the status quo of the 

subject matter of the suit pending trial on the merits. The ruling on the temporary 

injunction may not be used to obtain an advance ruling on the merits.” Iranian 

Muslim Org. v. City of San Antonio, 615 S.W.2d 202, 208 (Tex. 1981) (internal 

citations omitted). On appeal, the question “is whether the trial court abused its 

discretion in granting or denying the temporary injunction.” Id. Because the trial 

court cannot give an advance ruling on the merits, “the applicant is not required to 

establish that she will prevail on final trial . . . .” Walling v. Metcalfe, 863 S.W.2d 

56, 58 (Tex. 1993) (internal citations omitted).
14

“[C]ourts are often particularly careful when it comes to the element of 

‘probable right of recovery,’ sometimes referred to as ‘likelihood of success on the 

merits’ . . . .” Intercontinental Terminals, 354 S.W.3d at 897. This element “seems 

to infringe upon two well-engrained judicial prohibitions: against advisory 

opinions and against forming opinions about the merits of the case before the 

conclusion of the evidence.” Id. The “probable right of recovery” is a “term of art” 

in the law of temporary injunctions. Id. “[T]he applicant for [a] temporary 

injunction [need not] offer evidence and persuade the judge to find from that 

evidence the adjudicative facts necessary for the applicant to prevail on the merits, 

based on probabilities.” Id. (internal citations omitted). A temporary injunction 

hearing is not a “mini trial” in which “the judge predicts the applicant’s chances of 

success at the real trial, based upon the judge’s estimate of where the truth 

probably lies concerning the adjudicative facts and the law made applicable thereto 

by the pleadings in the case.” Id. (internal citations omitted). “[T]o show a 

probable right of recovery,” the party applying for a temporary injunction, “must 

plead a cause of action and present some evidence that tends to sustain it. The 

evidence must be sufficient to raise a bona fide issue as to the applicant’s right to 

ultimate relief.” Id. (internal citations and quotation marks omitted).

Thus, to “show a probable right of recovery,” the homeowners must “present 

some evidence that tends to sustain” their excessive-demand claim that the 
15

attorney’s fees were excessive and were either sought in bad faith or were 

unreasonable. Cameron v. Bell, No. 13-01-767-CV2003, WL 253609, at *2 (Tex. 

App.—Corpus Christi Feb. 6, 2003, no pet.); Intercontinental Terminals, 354 

S.W.3d at 897. The trial court made a finding that, at the time the demand letter 

was sent to the homeowners, “reasonable and necessary attorney’s fees and costs

. . . [were] $300.” The testimony at the temporary-injunction hearing provided 

substantial support for this finding and no contrary evidence was presented.

When a contract between a lawyer and his client contains a provision setting 

the amount of attorney’s fees, that provision establishes a presumption that the 

amount is reasonable between the client and the attorney—but this presumption 

does not apply to a third party from whom fees are sought, like the homeowners. 

See Leal v. Leal, 628 S.W.2d 168, 170–71 (Tex. App.—San Antonio 1983, no 

writ) (holding that agreement between plaintiff and attorney did not establish 

presumption of reasonableness when plaintiff attempted to recover attorney’s fees 

from defendant). 

Expert testimony on attorney’s fees is necessary if the fees are disputed. The 

homeowners presented expert testimony that the original demanded attorney’s fees 

were unreasonable. Stewart Beach’s attorney offered factual testimony regarding 

his fees. But, other than the attorney’s misinterpretation of a Fourteenth Court of 

Appeal’s decision, which we discuss below, Stewart Beach offered no expert 
16

testimony on the reasonableness of the demanded attorney’s fee or the number of 

hours expended on the tasks. In most cases, the attorney who testifies in support of 

the requested fees should quantify the number of hours and describe the tasks 

performed, supported by appropriate billing records or other documentary 

evidence. El Apple I, Ltd. v. Olivas, 370 S.W.3d 757, 763 (Tex. 2012). In 

determining the reasonableness of the fee, the trial court must consider (1) the 

number of hours the attorney reasonably worked on the claim and (2) the 

reasonable hourly rate for that work. Id. 

At the hearing, however, Stewart Beach’s attorney generally described the 

work necessary to complete the demand letter and lien notice and work he did after 

sending the demand letter. This evidence does not support the original fee demand

in excess of the flat fee. He did not provide any timesheets or other evidence of the 

number of hours he reasonably worked on the demand letters. To the extent the 

work corresponded to any aspect of the hybrid fee arrangement, it appears to 

correspond to the flat fees that would be charged, which is the amount found by the 

trial court to be the reasonable amount of fees through the date the demand letter

was sent.

1. Combination of hybrid fee

The homeowners’ expert used the attorney’s fee demand sent to one of the 

four homeowners, Simca and Ahuva Heled, to illustrate the unreasonableness of 
17

Stewart Beach’s attorney’s hybrid fee.7 The Heleds owed Stewart Beach $3,616.33 

in assessments. In addition to the amount due for assessments, Stewart Beach’s

demand letter demanded $1,665.27 in attorney’s fees (roughly 44% of the 

assessments owed) without any supporting calculation. During the temporaryinjunction hearing, the homeowners’ attorney asked Stewart Beach’s attorney how 

much of that $1,665.27 was for his hourly fees. He responded, “I don’t know. . . . It 

was $75 for the standard cure notice. I bill $225 for liens . . . . Then there’s 20 

percent of the delinquent amount collection fee . . . .” That testimony leaves about 

$642 of remaining fees.8

2. Flat Fee

The only evidence presented to the trial court regarding the reasonableness 

of Stewart Beach’s fees when it issued the temporary injunction is the flat fee of 

$75 for writing the collection letter and $225 for filing the lien. The homeowners’

 7 The chart below summarizes the demanded fees:

Flat Fee Contingent Fee 

(20% of $3,616.33)

Remaining 

Fees

Total

$300 $723.27 $642 $1,665.27

8 Even if we assume the flat fee was only intended to cover the paralegal’s time and 

that the attorney would also charge an hourly fee on top of the flat fee (a fee 

arrangement that is not clearly set forth in the engagement letter), to justify this 

amount at his $195 hourly rate, Stewart Beach’s attorney would have to present 

evidence that he spent 3.25 hours reviewing a two-page form letter and a two-page 

notice of lien and did so for each form letter sent to the homeowners. No such 

evidence was presented.
18

expert testified that these flat fees were “reasonable.” The trial court set the 

reasonable attorney’s fees in the bond at $300—presumably to cover Stewart 

Beach’s attorney’s flat fee. But Stewart Beach demanded attorney’s fees much 

higher than that. Therefore, we look to the other portions of the hybrid fee 

arrangement for support.

3. Hourly fee

Stewart Beach’s attorney testified that he charges $195 an hour. The 

homeowners did not challenge the attorney’s hourly rate. Their expert did, 

however, testify that charging an hourly rate on top of the flat fee and on top of the 

contingency fee was “clearly excessive,” not “reasonable,” and “unconscionable.”

Stewart Beach offered no testimony or billing records to substantiate an hourly-fee 

charge beyond the flat fee already charged for the work the attorney described he 

performed.

Based on this lack of evidence, the trial court did not abuse its discretion in 

finding that the homeowners had a likelihood of success on the merits of their 

challenge to Stewart Beach’s attorney’s hourly-rate fees over and above the flat 

fee.

4. Contingency Fee

If the contract between the attorney and the client provides for a contingency 

fee, attorney’s fees cannot be recovered based solely on the evidence of the fee 
19

agreement. Arthur Andersen & Co. v. Perry Equip. Corp., 945 S.W.2d 812, 818 

(Tex. 1997). Instead, the factfinder must determine the reasonableness of a 

contingency fee in a specific dollar amount. Id. at 819. When the factfinder 

determines the reasonableness of the fee, it must consider, among other factors, the 

uncertainty of collection before the legal services have been rendered. Id. at 818. 

Even if the contingent fee is reasonable from the standpoint of the client and the 

attorney, the fee is not necessarily reasonable when the attorney attempts to collect 

from a third party, like the homeowners. Id.

Stewart Beach’s attorney provided no evidence that the specific dollar 

amount collected on the basis of the 20% contingency fee is reasonable.

9 Instead, 

the attorney offered two rationales for the fee: (1) it was the fee set forth in his 

engagement letter and (2) it was the same percentage contingency fee approved by 

the Court of Appeals in Schwartzott v. Marvilla, 390 S.W.3d 15 (Tex. App.—

Houston [14th Dist.] 2012, pet. denied).

The first rationale is not persuasive: as previously discussed, the attorney’s 

fee contract is not binding on a third party.

 9 Although Stewart Beach argues that the 20% fee is not a contingency fee, the 

engagement letter suggests otherwise. The attorney’s contract reads that he “will 

be entitled to a flat fee equal to 20% on all collections.” If a homeowner does not 

pay the assessment, no collection occurs and thus Stewart Beach would not owe 

their attorney the 20%. Thus, the fee is contingent on collection and is a 

contingency fee. See Arthur Andersen, 945 S.W.2d at 818 (referring to 

contingency fees as fees that “compensate the attorney for the risk that the 

attorney will receive no fee whatsoever if the case is lost”). 
20

The second rationale is based on a misinterpretation of Schwartzott on three 

levels. First, the attorney’s fee there was 10%—not 20%. Id. at 21. Second, it was 

part of a two-fold—not three-fold—hybrid agreement that included a flat and 

contingency, but not hourly, fee. Id. Third and most importantly, the court did not 

“approve” the fee; it held, based on the limited record and expert testimony before 

it, that the trial court did not err in awarding the attorney’s fees. Id.

In contrast, the homeowners provided expert testimony that Stewart Beach’s 

attorney’s contingency fee was unreasonable. The expert testified that charging a 

contingency fee in addition to the hourly rate constituted an excessive fee. Their 

expert testified that this fee arrangement was particularly unreasonable given that 

the homeowner association assessments were comparatively small dollar amounts 

compared to the value of the condominiums and were secured by a lien on the 

condominium. This testimony indicates that the “uncertainty of collection” (one of 

the Arthur Andersen10 factors for determining the reasonableness of contingency 

fees) was relatively low, weighing against the reasonableness of a contingency fee

on top of the flat fee and the hourly fee. 

Based on the testimony at the hearing, the homeowners presented evidence 

in support of their claims of a fraudulent lien and excessive demand and

established a “bona fide issue as to the applicant’s right to ultimate relief.” 

 10 945 S.W.2d at 818.
21

Intercontinental Terminals, 354 S.W.3d at 897. This “bona fide issue” justified the 

trial court’s decision to grant the temporary injunction to “maintain the status quo” 

until a trial on the merits could determine whether the attorney’s fees were 

reasonable.

Stewart Beach argues that the homeowners’ failure to pay the assessments 

that they admit they owe precludes them from benefiting from a temporary 

injunction to stop foreclosure. It is true that “claimed confusion concerning the 

amount of the payment required to avoid foreclosure is not in itself grounds for an 

injunction. . . . [A] debtor seeking equitable relief from a foreclosure sale must first 

tender the full sum of the admitted debt.” Ginther-Davis Ctr., Ltd. v. Houston Nat’l 

Bank, 600 S.W.2d 856, 864 (Tex. Civ. App.—Houston [1st Dist.] 1980, writ ref’d 

n.r.e). If a party admits to owing part of a debt, it must make “an unconditional 

offer . . . [of] a sum not less in amount than that due.” Baucum v. Great Am. Ins. 

Co. of New York, 370 S.W.2d 863, 866 (Tex. 1963). 

The requirement for a debtor to tender the amount owed, however, does not 

require “that the money was to be brought into Court, or tendered as a condition 

precedent to the granting of relief;” the debtor must show only “a readiness and 

willingness to pay” and act “in good faith.” Poff v. Rollinsford Sav. Bank, 105 

S.W.2d 782, 783 (Tex. Civ. App.—Amarillo 1937, no writ). In Poff, the debtor 

“asked the court to determine their indebtedness to appellees and offered to pay the 
22

amount thereof when determined.” Id. This offer to pay the full amount determined 

by the factfinder constituted a sufficient offer “of the full amount owed.” Id.

Here, the homeowners explicitly state in their pleading that they did not 

“dispute their obligation to pay appropriate assessments”;

11 they disputed the 

amount of the attorney’s fees. During the temporary injunction hearing, one of the 

homeowners testified that he, representing the other homeowners with delinquent 

assessments, offered to pay Stewart Beach “the assessments and on top of it [ ] 

would add 20 percent of [the attorney’s] fees.” This amount was more than the 

amount the trial court found was reasonable.12 In addition to the offer the 

homeowners made to Stewart Beach, the homeowners posted a bond—“brought 

[the money] into Court”—for the amount they admit they owed in assessments and 

the amount the trial court found was a reasonable attorney’s fee as a condition of 

 11 There is an additional dispute over the amount of assessments that are due. The 

homeowners argue that “previous assessments may [ ] not have been properly 

credited” and may have been “improperly applied to [attorney’s] fees or otherwise 

handled in violation of the Bylaws.” No evidence was provided at the temporaryinjunction hearing to support this claim so the temporary injunction cannot be 

based on this allegation in the pleadings. See Bay Fin. Sav. Bank, FSB v. Brown, 

142 S.W.3d 586, 589–90 (Tex. App.—Texarkana 2004, no pet.) (“No temporary 

injunction may issue unless the applicant offers competent evidence in support of 

his or her application to the trial court at the hearing on the temporary injunction . . 

. .”).

12 For example, 20% of the $1,665.27 in attorney’s fees that Stewart Beach’s 

attorney attempted to charge the Heleds would be $333.06—greater than the $300 

that the trial court found was reasonable. 
23

the temporary injunction. Poff, 105 S.W.2d at 783. This bond protected Stewart 

Beach’s interests.

While the homeowners have not tendered the assessments that they admit 

they owe to Stewart Beach, the actions taken by the homeowners of 

(1) offering to pay the admitted debt due and (2) posting a bond as a condition of 

the temporary injunction satisfy the requirements of Texas law. We hold that the 

homeowners met the element of “probable right to the relief sought” to obtain the 

temporary injunction.

B. Irreparable Injury

Stewart Beach argues that the homeowners are not irreparably harmed 

because they are “protected from wrongful foreclosure by the redemption 

provision of the [Texas Uniform Condominium Act] . . . [and] the legal remedy of 

a lawsuit for wrongful foreclosure . . . .”

A trial court cannot issue an injunction when the party seeking the injunction 

has a plain and adequate legal remedy. Int’l Harvester Credit Corp. v. Rhoades, 

363 S.W.2d 397, 399 (Tex. Civ. App.—Austin 1962, no writ). A temporary 

injunction is, however, appropriate to block foreclosure of real property. Irving 

Bank & Tr. Co. v. Second Land Corp., 544 S.W.2d 684, 688 (Tex. Civ. App.—

Dallas 1976, writ ref’d n.r.e.). “[I]t is obvious that [the property owner] would 
24

probably be injured if the property were foreclosed and sold . . . . ” Franklin Sav. 

Ass’n, 756 S.W.2d at 15–16.

The right to monetary damages in a lawsuit for wrongful foreclosure is not 

an adequate remedy because “every piece of real estate is unique, and if 

foreclosure were allowed before a full determination” of the underlying claim, the 

homeowner “would be irreparably harmed.” Perales v. Riviera, No. 13-03-002-

CV, 2003 WL 21705740, at *3 (Tex. App.—Corpus Christi July 24, 2003, no pet.) 

(mem. op.); El Paso Dev. Co. v. Berryman, 729 S.W.2d 883, 888 (Tex. App.—

Corpus Christi 1987, no writ). Thus the availability of a remedy, like a claim for 

wrongful foreclosure, that provides monetary damages does not negate the element 

of “irreparable harm.” Guardian Sav. & Loan Ass’n v. Williams, 731 S.W.2d 107, 

108–09 (Tex. App.—Houston [1st Dist.] 1987, no writ); Perales, 2003 WL 

21705740, at *3.

The right of redemption is also not an adequate remedy for the homeowners. 

A foreclosure can, itself, be a substantial burden to the property owner—even if the 

property owner can recover the property. For example, a foreclosure can “ruin [the 

owner’s] reputation, prevent him from borrowing money at any other financial 

institution in the United States.” Guardian Sav. & Loan Ass’n, 731 S.W.2d at 108.

Neither a lawsuit for monetary damages for wrongful foreclosure nor the 

statutory right of redemption is an adequate remedy for the homeowners. The 
25

homeowners established that they would suffer “irreparable harm” if Stewart 

Beach foreclosed on their properties.

Accordingly, we overrule Stewart Beach’s second issue.

Unclean Hands

Stewart Beach next argues that “[a]sking the trial court to enjoin [Stewart 

Beach’s] statutory and contractual rights while [the homeowners] confess to 

material breach flies in the face of equitable principles. . . . [The homeowners]

confess they owe the debt for delinquent assessments, the court found they owed 

the debt and included the findings in the injunction Orders.”

The doctrine of “unclean hands” allows a court to “refuse to grant equitable 

relief, such as an injunction, sought by one whose conduct in connection with the 

same matter or transaction has been unconscientious, unjust, or marked by a want 

of good faith, or one who has violated the principles of equity and righteous 

dealing.” Park v. Escalera Ranch Owners’ Ass’n, Inc., 457 S.W.3d 571, 597 (Tex. 

App.—Austin 2015, no pet.) (internal quotation marks and citations omitted). “A 

party seeking to invoke this equitable doctrine must show that he has been 

seriously harmed and the wrong complained of cannot be corrected without 

applying the doctrine.” City of Fredericksburg v. Bopp, 126 S.W.3d 218, 221 (Tex. 

App.—San Antonio 2003, no pet.).
26

Admitted breach of a contract is not necessarily sufficient to invoke the 

doctrine of unclean hands.13 See David v. Bache Halsey Stuart Shields, Inc., 630 

S.W.2d 754, 758 (Tex. App.—Houston [1st Dist.] 1982, no writ) (refusing to apply 

unclean-hands doctrine to prevent party who admitted to breaching arbitration 

provision from seeking temporary injunction); Spring v. Walthall, Sachse & Pipes, 

Inc., No. 04-05-00228-CV, 2005 WL 2012669, at *2 (Tex. App.—San Antonio 

Aug. 24, 2005, no pet.) (mem. op.) (affirming trial court’s order granting 

temporary injunction and rejecting argument that moving party had unclean hands 

because of breach of contract). Thus, the homeowners’ admission that they did not 

pay the assessments does not bar them from seeking a temporary injunction. 

In addition, Stewart Beach does not show that it is “seriously harmed” or 

that any “wrong complained of cannot be corrected without applying the doctrine.” 

City of Fredericksburg, 126 S.W.3d at 221. The trial court’s requirement that the 

homeowners post a bond in the amount of the assessments and reasonable 

 13 None of the cases cited by Stewart Beach held that an admission of a breach of 

contract automatically bars a party from seeking an injunction under the uncleanhands doctrine. In three of the cases cited by Stewart Beach, the courts upheld the 

temporary injunctions, holding that the moving party did not have unclean hands. 

LDF Constr., Inc. v. Bryan, 324 S.W.3d 137, 149–50 (Tex. App.—Waco 2010, no 

pet.); In re Jim Walter Homes, Inc., 207 S.W.3d 888, 899 (Tex. App.—Houston 

[14th Dist.] 2006, no pet.); Thomas v. McNair, 882 S.W.2d 870, 881 (Tex. App.—

Corpus Christi 1994, no pet). The fourth case, City of Fredericksburg v. Bopp, did 

find that the party seeking the injunction had unclean hands because the party’s 

actions were “marked by a want of good faith.” 126 S.W.3d at 222. That case is 

not analogous to this case, however, because Stewart Beach has not presented any

allegation or proof of bad faith by the homeowners.
27

attorney’s fees they admit are due protects Stewart Beach’s interests, and, thus any 

“wrong complained of” has been “corrected” without applying the unclean-hands 

doctrine. Id. Accordingly, we overrule Stewart Beach’s third and final issue.

Conclusion

We affirm the order of the trial court.

Harvey Brown

Justice

Panel consists of Justices Jennings, Higley, and Brown.