Court Opinion

ID: 2926121
Source: CourtListenerOpinion
Date Created: 2015-09-11 22:23:32.259032+00
Date Added: 2024-06-11T11:39:15.976582
License: Public Domain

NUMBER 13-08-00264-CV

                           COURT OF APPEALS

                 THIRTEENTH DISTRICT OF TEXAS

                   CORPUS CHRISTI - EDINBURG

NETRANA, L.L.C.,                                                           Appellant,

                                          v.

TXU BUSINESS SERVICES COMPANY,                                              Appellee.

                 On appeal from the 298th District Court of
                          Dallas County, Texas.

                        MEMORANDUM OPINION

    Before Chief Justice Valdez and Justices Rodriguez and Garza
            Memorandum Opinion by Chief Justice Valdez

      In five issues, which can be properly construed as two, appellant, Netrana, L.L.C.

(“Netrana”), challenges a summary judgment granted in favor of appellee, TXU Business

Services Company (“TXU”). We affirm.

                                    I. BACKGROUND

      On June 2, 2006, Netrana, a consulting firm, contracted with TXU to provide project
management services. The agreement provided the following:

                        ARTICLE 6: TERM OF AGREEMENT

      The term during which [Netrana] will perform Services under this Agreement
      is for the period commencing June 6, 2002, and ending August 31, 2002,
      (the “Term”) unless terminated earlier pursuant to the provisions of the
      Agreement. The Term may be extended by a written amendment signed by
      both parties. . . .

      [Netrana] will perform Services a minimum of twelve (12) days per month
      during the Term of this Agreement.

                            ARTICLE 7: COMPENSATION

      [Netrana] will be entitled to compensation for authorized professional
      Services at the following rate and subject to the conditions contained in this
      Agreement.

             $1200.00/day plus expenses

             ....

                     ARTICLE 31: ENTIRETY OF AGREEMENT

      This Agreement, together with any and all attachments or documents
      incorporated into it, constitutes the entire Agreement between the parties,
      and all prior negotiations, undertakings, understanding and agreements
      between the parties relating to the Services are merged into this Agreement.

The agreement was signed by Scott Potter, vice president of Netrana, and Debra Davis,

senior contracts representative of TXU.      On September 1, 2002, the same party

representatives signed an amendment which extended the agreement to December 31,

2002, and provided that, the agreement was to continue on a month-to-month basis

thereafter. The amendment included the following relevant provision:

                                ARTICLE 2: PURPOSE

      This Amendment modifies, alters or changes specific terms and conditions
      of [the Agreement] that exist between the parties hereto. The modified terms
      and conditions set out below supersede and replace in their entirety any
      contradictory terms or conditions contained in the Agreement. Except as
      modified in the Amendment or previous amendments, the Agreement will
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      remain in full force and effect.

             ....

                             ARTICLE 3: MODIFICATIONS

             ....

      D.     Compensation: The language below supercedes and replaces the
             language contained in the original Agreement.

             [Netrana] will be entitled to compensation for authorized Services at
             the following rate and subject to the conditions contained in this
             Agreement. [Netrana] will be compensated for hours actually worked.

             $1200.00/day plus expenses or $150.00/hr. if less than 1 day.

Additionally, the amendment provided that after December 31, 2002, TXU could terminate

the agreement by providing two weeks written notice.

      On December 13, 2004, TXU provided written notice to Netrana of its termination

of the agreement. Netrana then sued TXU for breach of contract, fraudulent inducement,

“intentional and/or negligent misrepresentation,” fraud, false promise, and promissory

estoppel. TXU answered with a general denial and asserted several affirmative defenses,

including waiver of Netrana’s rights under the agreement or amendment.

      On August 31, 2007, TXU filed a hybrid motion for summary judgment. As to

Netrana’s breach of contract claim, TXU asserted, as a traditional ground for summary

judgment, that there was no breach of any written agreement, and it attached, inter alia,

the agreement and its amendment. As to Netrana’s remaining claims, TXU asserted no-

evidence grounds for summary judgment. Netrana responded to the breach-of-contract

ground by arguing that the agreement and amendment could be read as providing for a

minimum payment of $14,400 per month, representing twelve days of work. Netrana

further argued that TXU “ratified” such an agreement by paying invoices that it submitted

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until July 2004, and Netrana attached numerous invoices to its response. Additionally,

Netrana contended that the affidavits of Potter and Nick Cioll, the TXU representative who

negotiated the contract with Potter, created fact issues as to its remaining claims. Cioll’s

affidavit, which was attached to Netrana’s response, provides in relevant part:

       It is true that Scott Potter, who represented NETRANA, LLP, informed me
       that Scott Potter refused to agree to the terms of the contract without a
       guaranteed minimum per month which was the reason TXU agreed to the
       following provisions:

       c.     At all relevant times it was understood and agreed that NETRANA[,]
              L.L.C. would be paid for a minimum of 12 days pursuant to the daily
              rate of $1,200.00, according to the “Article 6: Term of Agreement”

       d.     In exchange NETRANA, L.L.C. agreed to be ready, willing and able
              to perform professional services for a minimum of 12 days per month,
              TXU agreed to pay the sum of $1,200.00 per day for those 12
              minimum days, for a minimum sum of $14,400 per month per month
              [sic] for training until the agreement was terminated pursuant to the
              agreement’s written notice of termination.

       In addition, NETRANA, L.L.C., agreed to an hourly rate of $150 per hour for
       those days when less than a full day was worked. The hourly amount was
       intended to be in addition to the minimum per month.

       At that time, SCOTT POTTER informed TXU that unless NETRANA was
       guaranteed a per month minimum until the contract was terminated
       according to the terms, NETRANA could not afford to be available without
       any work so NETRANA would not agree to perform any of the services.

       Additionally, Netrana filed a cross-motion for traditional summary judgment on its

breach of contract claim. On December 14, 2007, TXU objected to the affidavits of Potter

and Cioll on the ground that they constituted inadmissible parol evidence. The trial court

granted TXU’s traditional motion for summary judgment as to Netrana’s breach of contract

claim and its no-evidence motion for summary judgment on the remaining claims; it also

denied Netrana’s motion for summary judgment. This appeal ensued.

                                      II. DISCUSSION

                                             4
        In five issues, which we construe as two, Netrana contends that the trial court erred

by granting summary judgment to TXU on Netrana’s intentional misrepresentation and

breach of contract claims.1

A.      Standard of Review

        The trial court granted TXU a no-evidence summary judgment on Netrana’s

intentional misrepresentation claim. We review a trial court’s ruling on a no-evidence

motion for summary judgment for legal sufficiency. Mack Trucks, Inc. v. Tamez, 206
S.W.3d 572, 579-80 (Tex. 2006); King Ranch, Inc. v. Chapman, 118 S.W.3d 742, 750-51

(Tex. 2003). Accordingly, we review the evidence in the light most favorable to the

non-movant, disregarding all contrary evidence and inferences. City of Keller v. Wilson,

168 S.W.3d 802, 825 (Tex. 2005) (noting that review of a “no-evidence” motion for

summary judgment is effectively restricted to the evidence contrary to the motion); Ortega

v. City Nat’l Bank, 97 S.W.3d 765, 772 (Tex. App.–Corpus Christi 2003, no pet.) (op. on

rehr’g). The burden of producing evidence is entirely on the non-movant; the movant has

no burden to attach any evidence to the motion. See TEX . R. CIV. P. 166a(i). Summary

judgment is improper if the non-movant produces evidence to raise a genuine issue of

material fact. See id. To raise a genuine issue of material fact, the non-movant must

produce a scintilla of probative evidence. Ortega, 97 S.W.3d at 772. “Less than a scintilla

of evidence exists when the evidence is ‘so weak as to do no more than create a mere

surmise or suspicion of a fact.’” Id. (quoting Kindred v. Con/Chem, Inc., 650 S.W.2d 61,

63 (Tex. 1983)). Conversely, more than a scintilla exists when the evidence “rises to a

level that would enable reasonable and fair-minded people to differ in their conclusions.”

        1
          Netrana does not appeal the sum m ary judgment on its fraudulent inducem ent, negligent
m isrepresentation, fraud, false prom ise, and prom issory estoppel claim s. Therefore, we will not discuss these
issues. See T EX . R. A PP . P. 47.1.
                                                       5
Id. (citing Transp. Ins. Co. v. Moriel, 879 S.W.2d 10, 25 (Tex. 1994)). In determining

whether the non-movant has produced more than a scintilla of evidence, we review the

evidence in the light most favorable to the non-movant, crediting such evidence if

reasonable jurors could, and disregarding contrary evidence unless reasonable jurors could

not. Tamez, 206 S.W.3d at 582; City of Keller, 168 S.W.3d at 827.

       Both parties moved for a traditional summary judgment on Netrana’s breach of

contract claim. We review the traditional summary judgment de novo. Joe v. Two Thirty

Nine Joint Venture, 145 S.W.3d 150, 156 (Tex. 2004). The standards for reviewing a

summary judgment are well established: (1) the movant must demonstrate that there is

no genuine issue of material fact and that it is entitled to judgment as a matter of law; (2)

in deciding whether a disputed issue of material fact exists that would preclude summary

judgment, we take all evidence favorable to the non-movant as true; and (3) we indulge

every reasonable inference and resolve any doubts in favor of the non-movant. Nixon v.

Mr. Prop. Mgmt. Co., 690 S.W.2d 546, 548-49 (Tex. 1985). When, as here, both parties

file motions for traditional summary judgment and the court denies one and grants the

other, we must review the summary-judgment evidence presented by both sides, decide

all questions presented, and render the judgment that the trial court should have rendered.

City of Garland v. Dallas Morning News, 22 S.W.3d 351, 356 (Tex. 2000).

B.     Intentional Misrepresentation

       A claim of intentional misrepresentation has the same elements as a fraud claim.

See Smith v. Tilton, 3 S.W.3d 77, 82 n.3 (Tex. App.–Dallas 1999, no pet.). The elements

of a cause of action for fraud are: (1) that a material representation was made; (2) the

representation was false; (3) when the representation was made, the speaker knew it was

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false or made it recklessly without any knowledge of the truth and as a positive assertion;

(4) the speaker made the representation with the intent that the other party should act upon

it; (5) the party acted in reliance on the representation; and (6) the party suffered injury as

a result. In re FirstMerit Bank, N.A., 52 S.W.3d 749, 758 (Tex. 2001). A promise to do an

act in the future constitutes fraud only when made with no intention of performing the

promise at the time the promise was made. Formosa Plastics Corp. USA v. Presidio

Eng’rs & Contractors, Inc., 960 S.W.2d 41, 48 (Tex.1998). The mere failure to perform a

contract is not evidence of fraud. Id. Fraudulent intent may be established by either direct

or circumstantial evidence, and the subsequent failure to perform the promise, while not

alone dispositive, can be considered with other factors to establish intent. Spoljaric v.

Percival Tours, Inc., 708 S.W.2d 432, 434-35 (Tex. 1986).

       In what we consider its first issue, Netrana contends that the trial court erred by

granting TXU a no-evidence summary judgment on its intentional misrepresentation claim

because Cioll’s and Potter’s affidavits created a fact issue as to whether a false

representation was made by TXU representatives. Assuming that the affidavits were

properly before the court and indulging every reasonable inference in Netrana’s favor,

Netrana does not mention any representations made by TXU representatives to Netrana

regarding a guaranteed minimum monthly payment. All the affidavits state is that Potter

wanted a guaranteed minimum monthly payment; they do not state that TXU made a

representation that it would guarantee Netrana a minimum monthly payment. Additionally,

subsections “c” and “d” of Cioll’s affidavit, which Netrana claims were part of the

agreement, appear nowhere else in the record. Thus, there is no evidence that TXU made

any false representation.     See Formosa Plastics, 960 S.W.2d at 47-48 (Tex.1998)

                                              7
(providing that the mere failure to perform a contract is not evidence of fraud; rather, the

plaintiff must present evidence that the defendant made representations with the intent to

deceive and with no intention of performing as represented). Netrana’s first issue is

overruled.

C.     Breach of Contract

       In order to succeed on a breach of contract claim, Netrana would have had to prove

that: (1) a valid contract existed; (2) it performed or tendered performance; (3) TXU

breached the contract; and (4) Netrana sustained damages as a result of the defendant’s

breach. Adams v. H & H Meat Prods., Inc., 41 S.W.3d 762, 771 (Tex. App.–Corpus Christi

2001, no pet.). Netrana contends that it performed its obligations under the contract by

“standing ready, willing, and able to perform professional services” and that TXU breached

the guaranteed minimum payment provision of the contract. Thus, we look to the contract

under our well recognized rules of contract construction to determine if a minimum

payment provision existed in the amended agreement.

       In construing a written contract, the primary concern is to ascertain and to give effect

to the parties’ intentions as expressed in the document. Frost Nat’l Bank v. L & F Distribs.,

Ltd., 165 S.W.3d 310, 311-12 (Tex. 2005). We consider the entire writing and attempt to

harmonize and to give effect to all of the contract’s provisions. Id. at 312. We construe

contracts “‘from a utilitarian standpoint bearing in mind the particular business activity

sought to be served’” and “‘will avoid when possible and proper a construction which is

unreasonable, inequitable, and oppressive.’” Id. (quoting Reilly v. Rangers Mgmt., Inc.,

727 S.W.2d 527, 530 (Tex. 1987)). “The language in a contract is to be given its plain

grammatical meaning unless doing so would defeat the parties’ intent.” Amtech Elevator

Servs. Co. v. CSFB 1998-P1 Buffalo Speedway Office Ltd. P’ship, 248 S.W.3d 373, 379
                                        8
(Tex.App.–Houston [1st Dist.] 2007, no pet.).

        If, after the pertinent rules of construction are applied, the contract can be given a

definite or certain legal meaning, it is unambiguous, and we construe it as a matter of law.

Frost Nat’l Bank, 165 S.W.3d at 312. However, if after such rules are applied, the meaning

of the contract remains uncertain or is susceptible to more than one reasonable

interpretation, it is ambiguous. Nat’l Union Fire Ins. Co. v. CBI Indus., Inc., 907 S.W.2d
517, 520 (Tex. 1995); Coker v. Coker, 650 S.W.2d 391, 393-94 (Tex. 1983). If a contract

is ambiguous, the contract’s interpretation becomes a fact issue to be resolved by deciding

the parties’ true intent, for which the fact finder may consider extraneous evidence of

intent. See Nat’l Union Fire Ins. Co., 907 S.W.2d at 520; Coker, 650 S.W.2d at 394-95.

Whether a contract is ambiguous is a question of law to be determined “by looking at the

contract as a whole in light of the circumstances present when the contract was entered.”

Coker, 650 S.W.2d at 394.

        TXU moved for traditional summary judgment on the ground that the agreement and

its amendment required Netrana to work in order to be paid. In its second issue, Netrana

points to the affidavits of Cioll and Potter as support for the proposition that the intent of

the parties was to provide for a minimum monthly payment. Netrana further contends that

the trial court could not have granted TXU’s objection to the affidavits of Cioll and Potter

because the objection was untimely and there is no written order sustaining the objections.

        Neither of Netrana’s procedural arguments were presented to the trial court.

Therefore, they are waived.2 See generally, TEX . R. APP. P. 33.1. As to the merits of the
        2
          Even if Netrana’s procedural argum ents were not waived, they lack m erit. On Decem ber 14, 2007,
TXU filed a written objection to Cioll’s and Potter’s affidavits on the ground that the affidavits constituted
inadm issible parol evidence. It reurged the objection at the sum m ary judgm ent hearing on Decem ber 19.
Citing McConnell v. Southside Independent School District, 858 S.W .2d 337, 343 n.7 (Tex. 1993), Netrana
contends that “the nonm ovant m ust file its response or reply (including any objections to the m ovant’s
evidence) ‘not later than seven days prior to the day of [the] hearing.’” Netrana’s reliance on McConnell is
m isplaced because the McConnell court noted that “any exceptions filed by the m ovant [in a sum m ary
                                                      9
traditional summary judgment, we note that the agreement contained an integration clause,

providing that the written agreement constituted the entire agreement between the parties.

The purpose of an integration clause is to invoke the parol evidence rule when appropriate.

Burleson State Bank v. Plunkett, 27 S.W.3d 605, 615 (Tex. App.–Waco 2000, pet. denied).

An unambiguous contract will be enforced as written, and parol evidence will not be

received for the purpose of creating an ambiguity or to give the contract a meaning

different from that which its language imparts. See David J. Sacks, P.C. v. Haden, 266
S.W.3d 447, 450 (Tex. 2008).

        In this case, the contract, interpreted as a whole, is clear and unambiguous. Under

Article 6 of the agreement, Netrana was required to “perform Services a minimum of twelve

(12) days per month during the Term of this Agreement.” It does not state that Netrana is

guaranteed payment for twelve days worth of work regardless of whether it actually

performed the work. The amendment contains the following relevant sentence, “[Netrana]

will be compensated for hours actually worked.” This sentence, according to Article 2 of

the amendment, “supercede[s] and replace[s] in their entirety any contradictory terms or

conditions contain in the Agreement.” It is therefore clear that TXU was required to

compensate Netrana only for work that was actually performed. Accordingly, the trial court

did not err by granting TXU’s motion for summary judgment and denying Netrana’s. The

judgm ent proceeding] to the non-m ovant’s response m ust be filed and served not less than three days prior
to the hearing.” Id. (citing T EX . R. C IV . P. 21).

        W ith regard to Netrana’s contention that a trial court’s ruling on an objection to sum m ary judgm ent
evidence be m em orialized in writing, we have held that if the record indicates a ruling from the trial court,
either expressly or im plicitly, then error is preserved. See Columbia Rio Grande Reg’l Hosp. v. Stover, 17
S.W .3d 387, 395-96 (Tex. App.–Corpus Christi 2000, no pet.) (citing T EX . R. A PP . P. 33.1(a)(2)(A)). In
considering TXU’s written objections at the sum m ary judgm ent hearing, the trial court ruled:

        I do not think that the language of the contract is am biguous. I think any inform ation from the
        two affiants in connection with plaintiff’s proof is clearly parole [sic] evidence, as it attem pts
        to vary the term s of the contract, which I find not to be am biguous.

Although the trial court’s written judgm ent does not m ention its sustaining TXU’s objection, the trial court’s
statem ent at the sum m ary judgm ent hearing clearly does.

                                                       10
second issue is overruled.

                                    III. CONCLUSION

      The judgment of the trial court is affirmed.

                                                ROGELIO VALDEZ
                                                Chief Justice

Memorandum Opinion delivered and filed
on this the 12th day of November, 2009.

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