### T E X A S C O U R T O F A P P E A L S , T H I R D D I S T R I C T , A T A U S T I N

NO. 03-09-00265- CV

Dial Th ru International Corporation n/k/a Rapid Lin k; and Canm ax Ret ail Sys tem s, Inc., Appellan ts

v. Aff iliated Com puter Servic es, Inc., Appellee

F ROM TH E DISTRI CT COURT O F TRAVIS CO UNTY, 53RD J UDICIAL DI STRICT NO. D-1 -GV-0 5-0 0367 0, H ONO RAB LE SCO TT H . JENK INS, J UDGE P RESIDING

M E M O R A N D U M O P I N I O N Appellant Dial Thru I nternational Corp o ra t i o n (“D ial Thru”) , acting as assig nee of appellant Canmax Retail Sy stems, I nc. (“Canma x ”), filed suit ag ainst appellee Affiliated Computer Service s, I nc. (“A CS”) for brea ch of contra ct. Dial Thru alleg es that ACS is responsible for cer tain tax liabilities of Canmax pursua nt to an agree ment under which ACS purcha sed cer tain assets of Can m ax . ACS filed a motion for summ ary judgme nt contesting such responsibili ty as a matter of law. The district court g rante d ACS’s motion and enter ed a take- nothing judgme nt ag ainst Dial Thru. We af

firm. Background ACS enter ed into an asset purcha se ag ree ment (the “Ag ree ment”) with Canmax and its pare nt company Canmax I nc.—the prede cessor in interest to Dial Thru—on September 3, 1998. Under the Ag ree ment, Canmax agr eed to se ll “substantially all” of its assets to ACS.O ne of the assets ACS purcha sed was the rig ht to service an exis ting contra ct betwee n

Canmax and Southland Corporation. I n 2000, the Texas Comptroller of Public Acc ounts conducte d

a tax audit of Canmax for the period of Fe bruar y 1, 1995, t o M ar ch 3 1, 1999. The Comptroller conclude d that Canmax owed taxes to the State relating to the Southland contra ct in the amount of $545,304.28, as we ll as interest and pe nalties totaling $877,333.79.

The Sta t e filed suit ag ainst Dial Thru on Aug ust 5, 2005, seeking rec overy of the d el inquent taxes, interest, and penalties. Dial Thru, in turn, filed a third party action ag ainst ACS, alleg ing that ACS was l i ab l e fo r t he tax delinquency in acc ordanc e with the terms of the Ag ree ment. ACS soug ht summary judgme nt on Dial Thru’s third party claim. On April 13, 2009, the district court g rante d ACS’s motion for summary judgme nt and enter ed a take- nothing judgme nt in favor of

ACS. Dial Thru a

ppeals. 1

Anal ysis We revie w summary judgme nts de novo. Provide n t Life & Acc ident Ins. Co. v. Knott , 128 S.W .3d 211, 215 (Tex. 2003). Under the standard applicable to a traditional motion for

sum mary judgme nt, the motion should be g rante d only when the movant establishes that there is no g enuine issue as to any materia l fac t and that it is entitled to judgme nt as a matter of law. See

ACS h ad filed a counter claim ag ainst both Dial Thru and Canmax for indemnity for 1 any sums found to b e owed by ACS to the Comptroller with respe ct to the audit of Canmax, and Dial T h ru h ad al s o filed a third party action ag ainst Southland. On May 22, 2008, the State nonsuited its cause s of action ag ainst Dial Thru; on Fe bruar y 26, 2009, Dial Thru nonsuited i ts third party claim ag ainst Southland, appar ently due to a settlement ag ree ment; and on April 13, 2009, ACS n o n s u i ted its counter claim in anticipation of the district court’s g ranting its motion for summary judgme nt. Thus, the district court’s order on ACS’s motion for s u m m ar y j u dg ment disposed of all re maining c laims and bec ame f inal. 2T ex . R. Civ. P. 166a(c ); Nixon v. Mr. Prop. Mgmt. Co. , 690 S.W .2d 546, 548 (Tex. 1 9 8 5 ). I n

revie wing a m otion for summary judgme nt, we acc ept as true all evidenc e favor able to the non-movant, making ever y rea sonable infere nce and resolving all doubts in the non-movant’s favor

. See Nixon , 690 S.W .2d at 548-49.

ACS based its motion for summ ary judgme nt on the arg ument that the t ax liability resulting from the Comptroller’s audit was not included in the liabiliti es assumed by ACS under the Ag ree ment. Reg ardingthe assumption of liabiliti es, the Ag ree ment provides as f ollows:

1.3 Assumed L iabilities. At Closing, [ACS ] shall deliver to [C anmax] an Assumption Ag ree ment

. . . pursuant to which [ACS ] shall assume, pay , perf orm and discharg e (whe n and as they become due) the following liabiliti es (collec tively , the “Assumed L iabilities”):

(a) a ll li abilities and obligations of [C anmax] that acc rue, b e c o me owing or ar ise on or af

ter the Closing Date unde r the Assumed Contra cts;

. . . . 1.4 L iabilities Not Be ing Assumed. [ACS ] shall not assume or be responsible for any of the following liabiliti es or obligations of [C anmax] (collec tively , the “Excluded L iabilities”):

. . . . (c) except to the exten t i n cluded as an Assumed L iability (and expli citly identified) pursuant to Section 1.3(d), any liability or obligation of [C anmax] for fede ral, state, local or fore ign taxes associate d with the Assets or the B usiness for a

ny period prior

to the Closing Date ; [ and]

. . . . (j) all other liabilities, whether known, unknown, conting ent or fix ed of [Canmax] which ar e not spec ifically listed in S ection 1.3 above

.

3ACS relies on section 1.4(c) of the Ag ree ment. I t is undisputed that the tax liability at issue here

is not included or identified in section 1.3(d) of the Ag ree ment, is associate d wi t h t h e transfe rre d assets, and is for a period prior to the Ag ree ment’s closing date. There fo re , i n ac co rdanc e with section 1.4 of the A g ree ment, ACS did not assume and is not re sponsible for the tax liabilit y . 2

Dial Thru, howeve r, relies on section 1.3(a) of the Ag ree ment. Whil e section 1.4 sets out the “Excluded L iabilities,” section 1.3 sets out the “Ass u m ed L i ab i l ities” for which ACS is responsible to “pay , perf

orm and discharg e.” Section 1.3(a) includes in the assumed liabiliti es those that “ac crue , become owing or arise on or afte r the Closi ng Date under the Assumed Contracts.” Dial Thru contends that the tax liability is an “Assumed L iability ” in acc ordanc e with section 1.3(a) , and that if it is also an “Excluded L iabi l i t y ” in acc ordanc e with section 1.4(c) , the Ag ree ment is ambig uous and summary

judgme nt is im proper . Howeve r, even if Dial Thru is corr ect that the tax liability beca me owing under the assumed contra cts afte r the closing date and, there fore , falls within the scope of section 1.3(a) ,
we find that the only rea sonable interpre tation of the Ag ree ment is that the terms of section 1.4

s u p er s ed e t h e terms of section 1.3. “I f the written instrument is so worde d that it can be g iven a

cer tain or definite leg al meaning or interpre tation, then it is not ambig uous and the court will
construe the contra ct as a matter of law.” Coker v. Coker , 650 S.W .2d 391, 393-94 (Tex. 1983). I t

As an alternative basis for summary judgme nt, A CS arg ued that Dial Thr u could not sue 2 for indemnification under the Ag ree ment beca use Dial Thru was neither the corpor ate succe ssor of Canmax nor an assig nee of Canmax’s rig hts. Be cause we aff irm the district court’s judgme nt based on the tax liability n o t b ei n g ACS’s assumed liability under the Ag ree ment, we need not addre ss such alternative basis. See Picke tt v. Texas Mut. Ins. Co. , 239 S.W .3d 826, 840 (Tex. App.—Austin 2007, no pet.) (“We must aff irm the summary judgme nt i f an y o f t h e g rounds prese nted to the district court ar e mer itorious.”). 4is noteworthy that section 1.4(c) specific ally excepts the assumed liabiliti es set out in subsection (d)

of section 1.3. By specific ally excepting only subsection (d), section 1.4(c) indicates that the other subsections of section 1.3— including subsection (a) —are not excepted from section 1.4(c) ’s

cover ag e. I f section 1.3 wer e instead intended to superse de section 1.4, such language in section 1.4(c) would be incomplete and unnece ssary . I t is als o noteworthy that subsection (j) of section 1.4 identifies as excluded liabiliti es “all other liabiliti es . . . of [C anmax] which are not specific ally listed in Section 1.3.” I f section 1.3 superse ded section 1.4, subsection (j) would make subsections (a) throug h (i) of section 1.4 superf luous. I n contra st, by construing the Ag ree ment such that the exclusions in section 1.4 s u p er s ed e the inclusions in section 1.3, all the provisions of section 1.4 have meaning

. L iabilities that might otherwise be assumed liabiliti es in acc ordanc e with section 1.3 are instead excluded l i ab i l i t i es to the extent they are specific ally included in subsections 1.4(a) throug h (i), and any liability not included within section 1.3’s assumed liabiliti es

are excluded liabiliti es re g ardle ss whether they are cover ed by

subsections 1.4(a) throug h (i). 3 Dial Thru also argues that ACS waived its argum en t t h at it is not responsible for the tax liability under the Ag ree ment. First, Dial Thru ref ers to the Comptroller’s assessment of
taxes ag ainst ACS for the same transac tions and audit period at issue here , and ACS’s settlement of such claim for $275,000. The elements of waiver include (1) an exis ting rig ht, benef it, or advanta g e held by a party , (2) the party ’s actua l knowledg e of its exis tence , and (3) the party ’s actua l intent to

Dial Thru a lso ref

ers to section 6.2 of t he Agr eeme nt, which requires ACS to indemnify 3 Canmax for ACS ’s failure t o discharg e any assumed li ability

. Howeve r, because we int erpr et t he Ag ree ment, as a matter of law, such that ACS did not assume any liabiliti es included in section 1.4, section 6.2 does not af

fec t our ana ly sis. 5relinquish the rig ht, or intentional conduct inconsistent with the rig ht. Ulico Cas. Co. v. Allied Pilots

Ass’n , 262 S.W .3d 773, 778 (Tex. 2008). ACS contends that its settlement with the C o m p troller i s n ot inconsistent with its construction of the Ag ree ment. ACS alleg es, and Dial Thru does n o t dispute, that the C o mptroller’s claim ag ainst ACS was based on ACS being the purcha ser of Canmax’s assets irrespe ctive of the terms of the Ag ree ment. See Tex. Tax Code Ann. § 111.020(a) , (b) (West 2008). There is no evidenc e that the Comptroller’s claim ag ainst ACS was in an y way based on the Ag ree ment’s assumption-of-liability provisions. There fore , even if by settling with the Comptroller ACS has waived any argument that it is not liable to the Comptroller under the tax code, ACS has not thereby

waived its ar g ument that it is not liable under the terms of the Ag ree ment. Next, Dial Thru argues waiver based on the as s ertion that the tax liability is not

an assumed liability under the Ag ree ment being an aff irmative defe nse and AC S ’s m ak i n g only

a g ener al denial in its pleading s. See Tex. R. Civ

. P

. 9 4 ; Shoemak e v. Fogel, Ltd. , 826 S.W .2d 933, 937 (Tex. 1992) (“G ener ally , an aff irmative defe nse is waived if it is not pleade d.”). Howeve r,

as the plaintiff asser

ting a brea ch of contra ct cl aim, Dial Thru has the burden to prove that ACS brea ched the Ag ree ment. See Foster v. Centrex C a p i t a l Co rp. , 80 S.W .3d 140, 143-44 (Tex. App.—Austin 2 0 0 2 , p et

. denied)

. To satisfy its burden, Dial Thru had to show that the
tax liability was among ACS’s assumed liabiliti es under the Ag ree ment. Dial Thru cites no authority for the proposition that an asser tion that an asset purcha se agree ment excludes the liability at issue among those assumed b y the buy er constitutes an aff irmative defe nse. See Carbona v. CH Med., Inc. , 266 S.W .3d 675, 679-81 (Tex. App.—Dallas 2008, no pet.). I nstead, Dial Thru relies on case s in which a defe ndant soug ht to avoid its responsibility under an agree ment based on the agree ment’s

6limit ation of liability provision, see, e.g. , Continental Holdings, Ltd. v. Leahy , 132 S.W .3d 471, 475

(Tex. App.—Eastland 2003, no pet.), or based on the other party ’s neg lige nce, see, e.g. , Delta Eng’g Corp. v. W

arren Petroleum, I

nc. , 668 S.W .2d 770, 772-73 (Tex. A pp.—Houston [1st Dist.] 1984, writ ref ’d n.r.e.)

. Unlike those case s, ACS’s asser t i o n t h at t h e tax liability is excluded from its assumed liabiliti es tends to direc tly rebut Dial Thru’s fac tual asser tions. See Gorman v. Life Ins. Co. , 811 S.W .2d 542, 546 (T ex . 1991) (“Plea ding an aff irmative defe nse . . . seeks to establish an independe nt rea son why the plaintiff should not rec over.” ). ACS was not, ther efor e, require d to aff irmatively

plead its defe nse. We affir m the judgme nt of the district court.

__________________________________________ G. Alan Waldrop, Just ice Be fore Chief J ustice Jones, J ustices Waldrop and He nson Affir med Filed: August 3, 2010

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