Court Opinion

ID: 4073459
Source: CourtListenerOpinion
Date Created: 2016-09-30 04:01:57.600768+00
Date Added: 2024-06-11T14:32:48.612692
License: Public Domain

ACCEPTED
                                                                03-15-00256-CV
                                                                        6983697
                                                     THIRD COURT OF APPEALS
                                                                AUSTIN, TEXAS
                                                           9/18/2015 5:13:36 AM
                                                              JEFFREY D. KYLE
                                                                         CLERK

           No. 03-15-00256-CV
                                                FILED IN
     In the Third Court of Appeals       3rd COURT OF APPEALS
                                             AUSTIN, TEXAS
             Austin, Texas               9/18/2015 5:13:36 AM
                                           JEFFREY D. KYLE
                                                 Clerk

                ADRIAN JAMES
                  Appellant

                      V.

                KIRBY HISCOX
                   Appellee

   APPEAL FROM CAUSE NO. C-1-CV-14-008643
COUNTY COURT AT LAW NO. 1, TRAVIS COUNTY, TEXAS
         HON. TODD T. WONG, PRESIDING

            BRIEF OF APPELLEE

         LAW OFFICES OF HENRY J. NOVAK
                 Henry J. Novak
            State Bar No. 15120000
             11782 Jollyville Road
               Austin, Texas 78759
                 (512) 577-5380
              (512) 532-6008 (Fax)
            henry@henrynovak.com

              Counsel for Appellee

     ORAL ARGUMENT NOT REQUESTED
                                          TABLE OF CONTENTS

Index of Authorities ................................................................................................. iii

Guide to Citations ......................................................................................................v

Statement of the Case.................................................................................................1

Statement Regarding Oral Argument ........................................................................2

Issues Presented and Restated ....................................................................................2

         1.       The Contract is Unambiguous and Appellee’s theory of the case
                  is the only reasonable interpretation.

         2.       Appellant’s Interpretation of Par. 4 as a Liquidated Damage
                  Clause is without Merit.

         3.       Appellant should be Judicially Estopped from Arguing the
                  Contract is Ambiguous.

         4.       This Court should affirm the summary judgment on de novo
                  review.

Statement of Facts ......................................................................................................3

Summary of the Argument.........................................................................................4

Argument and Authorities..........................................................................................5

         I.       The Contract is Unambiguous. Appellee’s theory of the case is
                  the only reasonable interpretation of the Contract. ...............................5
         II.      Appellant’s Interpretation of Par. 4 as a Liquidated Damage
                  Clause is without Merit .........................................................................7

         III.     Appellant should be Judicially Estopped from Arguing the
                  Contract is Ambiguous ..........................................................................8
         IV.      This Court should affirm the summary judgment on de novo
                  review ..................................................................................................11

                                                             i
Conclusion and Prayer .............................................................................................12

Certificate of Compliance ........................................................................................13

Certificate of Service ...............................................................................................14

                                                           ii
                                       INDEX OF AUTHORITIES

Cases                                                                                                           Page(s)
Arthur’s Garage, Inc. v. Racal-Chubb Sec. Sys., Inc.,
      997 S.W.2d 803 (Tex. App.—Dallas 1999, no pet.) .......................................7

Carr v. Brasher,
      776 S.W.2d 567 (Tex. 1989) .........................................................................11

Cincinnati Life Ins. Co. v. Cates,
      927 S.W.2d 623 (Tex. 1996) .........................................................................11

Columbia Gas Transmission Corp. v. New Ulm Gas, Ltd.,
     940 S.W.2d 587 (Tex. 1996) .......................................................................6, 7
DeWoody v. Rippley,
    951 S.W.2d 935 (Tex. App.—Fort Worth 1997, writ dism’d by
    agr.) ................................................................................................................11
Ergo Science, Inc. v. Martin,
      73 F.3d 595 (5th Cir. 1996) ............................................................................11
Ferguson v. Bldg. Materials Corp. of Am.,
     295 S.W.3d 642 (Tex. 2009) .........................................................................10

Phillips v. Phillips,
       820 S.W.2d 785 (Tex. 1991) ...........................................................................7

Pickett v. Tex. Mutual Ins.,
      239 S.W.3d 826 (Tex. App.—Austin 2007, no. pet.) ....................................11

Pleasant Glade Assembly of God v. Schubert,
      264 S.W.3d 1 (Tex. 2008) .............................................................................10
Provident Life & Accident Co. v. Knott,
      128 S.W.3d 211 (Tex. 2003) ................................................................. 11, 12
Sheshunoff v. Sheshunoff,
     172 S.W.3d 686 (Tex. App.—Austin 2005, pet. denied) ..............................12
Star-Telegram, Inc. v. Doe,
      915 S.W.2d 471 (Tex. 1995) .........................................................................12

                                                            iii
Valence Operating Co. v. Dorsett,
      164 S.W.3d 656 (Tex. 2005) .....................................................................7, 11

                                                    iv
                          GUIDE TO CITATIONS
      References to the Clerk’s Record are shown as (“CR”) followed by page

number, e.g., “(CR 15)”; and references to the Reporter’s Record are shown as

“(RR)”, followed by page number. References to Appellant’s brief will be shown

as “(App. Br., at___)”.

                                      v
TO THE HONORABLE THIRD COURT OF APPEALS:

      Kirby Hiscox, Appellee, files this Appellee’s Brief and respectfully shows

the Court the following:

                           STATEMENT OF THE CASE
      Appellee sued Appellant in Travis County Court at Law No. 1 for breach of

contract. The parties filed cross-motions for summary judgment.

      Appellee offered summary judgment evidence in the form of his own

affidavit. Appellant offered no evidence.

      On February 5, 2015, a hearing on the motions was held before the Hon.

Todd T. Wong, judge presiding. The court granted Appellee’s motion, denied

Appellant’s motion, and entered a general summary judgment order. The order

awarded Appellee actual damages of $28,000.00, attorneys’ fees of $7,805.00,

through trial, and court costs of $257.00. In addition, the court awarded $3,500.00

for legal services if appealed to the Court of Appeals by Appellant and successfully

defended by Appellee; $5,000.00 for legal services in the event application is made

for Writ of Error to the Texas Supreme Court by Appellant and is denied; and

$7,500.00 for legal services in the event Writ of Error is granted by the Texas

Supreme Court and successfully defended by Appellee. The summary judgment

hearing was not transcribed by a court reporter.

      Appellant filed a timely motion for new trial.

                                         1
         On April 16, 2015, the motion for new trial was presided over by Hon. Eric

M. Sheppard, judge of Travis County Court No. 2. Judge Sheppard denied the

motion. The hearing on the motion for new trial was transcribed by a court reporter

and the reporter’s transcript is part of the record in this Court.

         Appellant filed timely Notice of Appeal, and this case is properly before this

Court.

                STATEMENT REGARDING ORAL ARGUMENT
         This is an appeal from a summary judgment, followed by a motion for new

trial. Appellant offered no evidence at either hearing, and the trial courts’ orders –

granting summary judgment for Appellee and overruling Appellant’s motion for

new trial – do not specify the grounds on which they are based. Well-settled

principles of law will therefore determine the outcome of this appeal. Appellee

does not believe oral argument would aid the Court in deciding this appeal.

However, if the Court decides oral argument is necessary, Appellee requests the

opportunity to participate.

                      ISSUES PRESENTED AND RESTATED
1.       The Contract is Unambiguous and Appellee’s theory of the case is the only
         reasonable interpretation.

2.       Appellant’s Interpretation of Par. 4 as a Liquidated Damage Clause is
         without Merit.

3.       Appellant should be Judicially Estopped from Arguing the Contract is
         Ambiguous.

                                            2
4.    This Court should affirm the summary judgment on de novo review.

                           STATEMENT OF FACTS
      On November 19, 2012, Appellant, a producer, and Appellee, an actor,

entered into a written contract pursuant to which Appellee made himself available

to render certain acting services to Appellant over a six–month period of time (the

“Contract”). (CR 19 –21)

      Appellee’s standard, daily rate for his acting services was $1,500.00, a rate

with which Appellant was familiar from previous business dealings between the

two men. This contract gave Appellant the option to pay a lesser rate.

      The parties negotiated a clause whereby Appellant specifically guaranteed to

provide Appellee with 20 days of acting work (“shoot days”) over the six–month

term of the contract, in consideration for which Appellee gave Appellant the option

to pay a daily rate of $1,000 if he scheduled all 20 guaranteed shoot days within

the first four months of the contract, or a rate of $1,500 a day if he choose to

spread the shoot days over the entire six–month term of the Contract. (CR 19, Par.

4) It was a win–win for both men: Appellant could save $10,000.00 over the life

of the contract if he scheduled all 20–shoot days in the first four months, and

Appellee could receive the benefit of having the assurance of $20,000.00 in hand

in after only four months. However, Appellee had no say as to when the 20 days

were scheduled; the schedule was left entirely to Appellant’s discretion.

                                         3
      As it turned out, Appellant scheduled two shoot days during the first four

months and never scheduled another day. Appellee rendered his acting services for

those two days for which Appellant paid him the lesser rate of $1,000 per day, a

total of $2,000. Appellee remained ready, willing and able to render his services to

Appellant throughout the entire six–month term of the Contract.

      Appellee sued Appellant to recover the agreed-upon, higher daily rate of

$1,500 for all 20 guaranteed days of work; i.e., $27,000 for 18 days at $1,500, and

$500.00 a day for the two-days’ work that were completed and paid for at the

lower rate of $1,000.

                        SUMMARY OF THE ARGUMENT
      1.     The compensation terms of the contract sued upon are unambiguous.

In awarding judgment for Appellee, the trial court properly calculated damages as

provided for in the contract.

      2.     Appellee argued only one theory of contractual interpretation in the

proceedings below, and in ruling in favor of Appellee both Judge Wong at the

hearing on the Motion for Summary Judgment and Judge Sheppard at the hearing

on the Motion for New Trial, accepted Appellee’s theory of the case. It is

Appellant’s burden to show that this theory has not merit, and he has failed to

sustain that burden.

                                         4
      3.     Appellant’s theory that Par. 4 of the Contract is a liquidated damages

clause lacks merit.

      4.     The summary judgment in favor of Appellee must be affirmed on de

novo review by this Court.

                       ARGUMENT AND AUTHORITIES

I.    The Contract is Unambiguous. Appellee’s theory of the case is the only
      reasonable interpretation of the Contract.
      The only summary judgment evidence was Appellee’s affidavit. In his

affidavit, Appellee testified that he had worked as a professional actor and host

for Appellant on several productions prior to November 2012 and that Appellant

had been pleased with his work.

      In November 2012, Appellant contacted Appellee and asked if he would be

interested in hosting another video project that would involve 30 or more days of

shooting over a six-month period of time.

      Appellant was familiar with Appellee’s $1,500 per day rate and asked him

if he would be willing to reduce that rate to $1,000 if Appellant guaranteed him a

minimum of 20 filming days in the first four months of the contract and, if

Appellant didn’t schedule all 20 days of filming within those first four months, he

would pay Appellee’s full daily rate of $1,500 for all 20 days of filming,

regardless of when they were filmed. Appellee accepted Appellant’s offer and

wrote up the contract that is the subject matter of this lawsuit.

                                           5
      Paragraph 4 of the contract specifies the terms of compensation. The first

sentence sets forth Appellant’s 20-day guarantee, as follows:

             4. MINIMUM GUARANTEED SHOOT DAYS. In
             exchange for Actor's agreement to reduce his fees to
             those stated above [$1,000 per day], the Producer
             guarantees to Actor a minimum of twenty (20) Shoot
             Days of filming, equivalent to $20,000.00 to be paid to
             Actor.

This guarantee is unequivocal and unconditional. There is no language anywhere

in the Contract relieving Appellant of the guarantee obligation.

      The second sentence sets forth the contingency for the increase of the daily

rate to $1,500.00:

             In the event that the twenty (20) Shoot Days are not met
             within the first four (4) months of the Agreement, the
             effective rate of $1,000.00 . . . will revert to $1,500.00
             per day rate and be paid retroactively for all completed
             Shoot Days and become due and payable within fourteen
             days after the end of the fourth (4th) month of this
             Agreement.

This sentence relates only to the contingency for the increase in the daily rate to

be paid by Appellant. It does not modify or dilute the guarantee in any way.

Appellant cannot point to any language in the contract that relieves him of the

guarantee.

      A contract is unambiguous if it can be given a definite or certain legal

meaning, Columbia Gas Transmission Corp. v. New Ulm Gas, Ltd., 940 S.W.2d
6
587, 589 (Tex. 1996), and the meaning put forth by Appellee and accepted by

Judges Wong and Sheppard is the only reasonable meaning of the Contract.

II.   Appellant’s Interpretation of Par. 4 as a Liquidated Damage Clause is
      without Merit.
      In his response to Appellee’s Motion for Summary Judgment, Appellant

argued that the contract was unambiguous and that Paragraph 4 of the Contract was

a liquidated damage provision by virtue of which he owes Appellee only the

additional sum of $3,000.00 not $28,000.00. (See, Defendant’s Response to

Motion for Summary Judgment, CR 37)

      A contractual liquidated damages clause estimates in advance the just

compensation a party will receive if the other party fails to perform. Valence

Operating Co. v. Dorsett, 164 S.W.3d 656, 664 (Tex. 2005). Whether a contractual

provision is an enforceable liquidated damages provision or an unenforceable

penalty is a question of law for the court to decide. Phillips v. Phillips, 820 S.W.2d
785, 788 (Tex. 1991).

      Courts will enforce a liquidated damages clause only on the presence of two

conditions: (1) the harm caused by the breach must incapable or difficult of

estimation; and (2) the amount of liquidated damages must be a reasonable forecast

of just compensation. Phillips, 820 S.W.2d at 788. If either element is lacking, the

liquidated damages clause is unenforceable. Arthur’s Garage, Inc. v. Racal-Chubb

Sec. Sys., Inc., 997 S.W.2d 803, 810 (Tex. App.—Dallas 1999, no pet.).

                                          7
       Paragraph 4 fails as an enforceable liquidated damage provision. The harm

suffered by Appellee as a result of Appellant’s default is easily capable of

determination, as Appellee has shown above.

III.   Appellant should be Judicially Estopped from Arguing the Contract is
       Ambiguous.
       Appellant devotes four of his five points of error to arguing that the

contract sued upon is, essentially, ambiguous, is susceptible of differing

interpretations and that the trial court did not construe the contract in the way he

thinks it should have been constructed. Appellant should be barred from making

any of these arguments.

       At the hearing on the cross–motions for summary judgment before Judge

Wong, Appellant took the position that the contract was unambiguous and

claimed the same in his Motion for Summary Judgment:

             Defendant contends that Paragraph 4 of the Agreement
             is unambiguous and it contains a specifically negotiated
             liquidated damage provision that dictates the
             consequence if twenty days of shooting at the reduced
             rate were not met. The unambiguous provision provides
             that the actor would be paid at his regular rate for all
             completed shoot days, or in other words at $1,500 for
             two days of service, or $3,000.

             Defendant objects to Plaintiff’s affidavit in support of his
             Motion for Summary Judgment as it is in admissible
             Parole Evidence. The Agreement is unambiguous and
             therefore any parole evidence is inadmissible. (CR 34)

                                          8
      Judge Wong agreed with Appellant that the Contract was unambiguous and

verbally sustained his objection to the use of the affidavit as evidence of the

meaning of the Contract. Furthermore, a week after the entry of the order granting

summary judgment, Appellant presented a formal order to the court sustaining his

objection to the affidavit. Judge Wong signed the order (CR 48).

      Having gained the advantage of excluding summary judgment evidence by

arguing the contract was unambiguous in the earlier proceeding, Appellant should

not now be permitted to argue the contract is ambiguous and thereby broaden the

scope of his challenge to the summary judgment, notwithstanding the fact that such

challenges lack merit.

      Counsel for Appellant recognized the inconsistency of the position he was

arguing before Judge Sheppard on his motion for new trial and attempted to

explain it away. What took place in his dialogue with the court pointedly illustrates

that Judge Sheppard fully understood Appellee’s position:

             MR. ESCOVER: I recognize I am arguing an
             inconsistent position than I did in the original proceeding
             before Judge Wong. At that point and time I read the
             words as they are written here without any interpretation.
             And if interpretation was needed, then the Rules --

             THE COURT: I am not sure what interpretation you
             would need to say the producer guarantees to actor a
             minimum of 20 shoot days of filming.

             MR. ESCOVER: What's the rate that he should be paid at
             if the 20 days aren't met.

                                         9
            THE COURT: Here is my problem.

            MR. ESCOVER: Sure.

            THE COURT: We keep conflating the two, that's part of
            the problem. Was he guaranteed 20 shoot days, yes or no.
            What the rate was is entirely a different subject.

            MR. ESCOVER: I would say, no, he wasn't Your Honor.

            THE COURT: What does the word mean when it says
            guarantees minimum of 20 shoot days.

            MR. ESCOVER: Up until the point you get to in the
            event. It spells out contingency, if 20 shoot days are not
            met here is your remedy. You have negotiated, you put
            this in here.

            THE COURT: Doesn’t that go back to the rate of pay.
            Mr. Novak's argument is all we are talking about there is
            how much he is getting paid for the days he shot. I
            guarantee you 20. If less than 20, this is how you are
            getting paid. How much you’re getting paid, not how,
            cause we already decided that. We decided in sentence
            one that it's 20 days. The question is how much are we
            paying you for those. The discount we get is 1000.00
            front load, no problem. If we don't have -- if we have 19
            days then all of a sudden it becomes a different story.
            (RR p. 18, line 6 – 19, line 13)

      Judicial estoppel precludes a party who successfully maintains a position in

one proceeding from later adopting a clearly inconsistent position in another

proceeding to obtain an unfair advantage. Ferguson v. Bldg. Materials Corp. of

Am., 295 S.W.3d 642, 643 (Tex. 2009); Pleasant Glade Assembly of God v.

Schubert, 264 S.W.3d 1, 6 (Tex. 2008). The elements of judicial estoppel are (1) a

                                       10
party’s position in an existing proceeding is inconsistent with its position in a prior

judicial proceeding; (2) the successful maintenance of the contrary position in the

prior action; (3) the absence of inadvertence, mistake, fraud, or duress in the

making of the prior statement; and (4) the statement was deliberate, clear, and

unequivocal. See, DeWoody v. Rippley, 951 S.W.2d 935, 944 (Tex. App.—Fort

Worth 1997, writ dism’d by agr.). As stated by the Fifth Circuit in Ergo Science,

Inc. v. Martin, 73 F.3d 595, 598 (5th Cir. 1996).

             [I]t is within the court’s discretion to utilize judicial
             estoppel and prevent [a party] from playing “fast and
             loose” with the court by “changing positions based upon
             the exigencies of the moment.”

IV.   This Court should affirm the summary judgment on de novo review.
      Because the trial court's order does not specify the grounds for the summary

judgment, this court must affirm the summary judgment if any of the theories

presented to the trial court and preserved for appellate review are meritorious.

Provident Life & Accident Co. v. Knott, 128 S.W.3d 211, 215 (Tex. 2003);

Cincinnati Life Ins. Co. v. Cates, 927 S.W.2d 623, 626 (Tex. 1996); Carr v.

Brasher, 776 S.W.2d 567, 569 (Tex. 1989).

      This Court succinctly stated the applicable rule in Pickett v. Tex. Mutual

Ins., 239 S.W.3d 826, 840 (Tex. App.—Austin 2007, no. pet.).

             We review the [trial] court’s summary judgment de novo.
             Valence Operating Co. v. Dorsett, 164 S.W.3d 656, 661
             (Tex. 2005). When the trial court does not specify the

                                          11
            basis for its summary judgment, the appealing party must
            show it is error to base it on any ground asserted in the
            motion. Star-Telegram, Inc. v. Doe, 915 S.W.2d 471, 473
            (Tex. 1995). We must affirm the summary judgment if
            any of the grounds presented to the [trial] court are
            meritorious. Provident Life Accident Ins. Co. v. Knott,
            128 S.W.3d 211, 216 (Tex. 2003); Sheshunoff v.
            Sheshunoff, 172 S.W.3d 686, 692 (Tex. App.—Austin
            2005, pet. denied).

Paragraph 4 is clear: there was a guarantee of 20 days of work that was not

rendered, resulting in damages to Appellee of $28,000, as calculated by the terms

of the second sentence of Paragraph 4. The judgment of the trial coutt should be

affirmed.

                         CONCLUSION AND PRAYER
      For all of the reasons set forth above, Appellee respectfully requests that this

Court affirm the trial court’s Summary judgment, and the this Court

      1.    Render judgment against Appellant and Appellant’s cash supersedes

bond (CR 257) for the performance of the judgment, attorney’s fees, and for costs

pursuant to TEX. R. APP. P. 24.1(d) and 43.5; and

      2.    Render judgment against Appellant for $3,500.00 for attorney’s fees

as awarded to Appellant in the Summary Judgment.

                                         12
                                     Respectfully submitted,

                                     LAW OFFICES OF HENRY J. NOVAK
                                     11782 Jollyville Road
                                     Austin, Texas 78759
                                     (512) 577–5380 (Telephone)
                                     (512) 532-6008 (Fax)

                                     ________________________________
                                     Henry J. Novak
                                     State Bar No. 15120000
                                     henry@henrynovak.com

                                     Counsel for Appellee

                     CERTIFICATE OF COMPLIANCE
      This document complies with the typeface requirements of Texas Rule of

Appellate Procedure 9.4(e) because it has been prepared in a conventional typeface

no smaller than 14-point for text and 12-point for footnotes. This document also

complies with the word-count limitations of Rule 9.4(i), if applicable, because it

contains 2,782 words, excluding any parts exempted by Rule 9.4(i)(1).

                                     Henry J. Novak

                                       13
                         CERTIFICATE OF SERVICE
      On September 18, 2015, in compliance with Texas Rule of Appellate

Procedure 9.5, I served this document by e-service, e-mail, facsimile, or mail to:

      Via e-Service
      Via Email: John@Escoverlaw.com
      John W. Escover
      THE LAW OFFICES OF JOHN W. ESCOVER, LLP
      401 Ranch Road 620 South, Suite 350
      Austin, Texas 78734
      Counsel for Appellant Adrian James

                                       Henry J. Novak

                                         14