Court Opinion

ID: 8374282
Source: CourtListenerOpinion
Date Created: 2022-10-19 06:09:49.878786+00
Date Added: 2024-06-11T16:46:16.655013
License: Public Domain

REVERSE and RENDER; AFFIRM and Opinion Filed October 12, 2022

                                   S  In The
                            Court of Appeals
                     Fifth District of Texas at Dallas
                               No. 05-21-00301-CV

                SURESH EDWARDS, Appellant
                           V.
   AHEAD OF THE CURVE COLLISION & PAINTING, LLC, Appellee

                 On Appeal from the Co Civil Ct at Law No 3
                           Harris County, Texas
                      Trial Court Cause No. 1152003

                       MEMORANDUM OPINION
                  Before Justices Myers, Carlyle, and Goldstein
                          Opinion by Justice Goldstein
      Suresh Edwards appeals the trial court’s orders granting default summary

judgment in favor of Ahead of the Curve Collision and Painting, LLC (ACCP) and

imposing sanctions against Edwards under chapter 10 of the civil practice and

remedies code. In two issues, Edwards argues the trial court erred in failing to set

aside the default no evidence summary judgment and in granting sanctions under

chapter 10. We affirm the trial court’s default summary judgment, reverse the trial

court’s award of sanctions, and render judgment that ACCP take nothing on its claim

for sanctions.

                                    BACKGROUND
      In February 2020, Edwards filed an original petition relative to his purchase

of a 2012 Ford Focus from ACCP in July 2017. Edwards alleged the car was a

salvage vehicle that had been repaired with the wrong parts, and he only discovered

this fact when he took the car to a Ford dealer. Edwards returned the car to ACCP

for repairs, but ACCP never fixed the car. Edwards asserted violations of the Texas

Deceptive Trade Practices-Consumer Protection Act (DTPA), common law fraud,

negligent misrepresentation, and breach of contract. Edwards also sought rescission

of the sales contract, damages, and attorney’s fees.

      In March 2020, ACCP filed its original answer alleging Edwards’ claims were

barred by the statute of limitations, the doctrine of unclean hands, fraud, laches, and

equitable estoppel. ACCP also filed a counter-petition against Edwards seeking a

declaratory judgment that the vehicle at issue was sold “as is,” was “clearly

advertised as having a rebuilt title” and that all subsequent documents reflecting the

exchange of ownership clearly shows that the vehicle had a rebuilt and/or salvaged

title. ACCP sought recovery of its costs and expenses related to defending Edwards’

lawsuit and in bringing its counter-petition.

      On July 15, 2020, ACCP filed two separate motions for summary judgment:

a no-evidence motion for summary judgment on Edwards’ breach of contract and

common law fraud claims and a motion for partial traditional summary judgment on

Edwards’ DTPA, negligent misrepresentation, and fraud claims. ACCP contended

that Edwards’ fraud claims were defeated by the “as is” clause in the contract, and

                                         –2–
the DTPA and negligent misrepresentation claims were barred by the two-year

statute of limitations. ACCP’s motion for traditional summary judgment was

supported by, among other things, copies of the July 19, 2017, bill of sale; the

vehicle’s certificate of title; the affidavit of Charmaine Ramjattan, ACCP’s manager;

and a copy of Edwards’ February 26, 2020 original petition. The bill of sale stated

payment was received from Edwards for the purchase of the subject vehicle “in as

is condition.” The certificate of title showed an issuance date of October 24, 2017,

and reflected “ACTUAL MILEAGE REBUILT SALVAGE – DAMAGED” under

the heading “REMARKS.” Ramjattan’s affidavit stated the “as is” language in the

bill of sale was “a crucial part of the basis of the bargain,” and ACCP would not

have sold the vehicle without the “as is” clause. Ramjattan’s affidavit further

averred no one at ACCP prevented Edwards from inspecting or obtaining a vehicle

report on the subject vehicle before purchasing it.

         Edwards did not respond to ACCP’s no-evidence summary judgment motion.

On July 22, 2020, Edwards filed a response to ACCP’s motion for partial traditional

summary judgment and a cross-motion for partial summary judgment that the bill of

sale did not conspicuously disclaim any implied warranty.

         On August 13, 2020, the trial court granted, in part, ACCP’s partial summary

judgment on Edwards’ DTPA and negligent misrepresentation claims.1 That same

   1
       The trial court struck through “fraud” on the proposed order.

                                                    –3–
day, the trial court granted Edwards’ cross-motion for summary judgment on “the

disclaimer issue,” finding as a matter of law that the “as is” language was not

conspicuous within the meaning of the business and commerce code. On August

15, 2020, the trial court granted a default no-evidence summary judgment ordering

that Edwards take nothing on his breach of contract and fraud claims.

      On August 28, 2020, Edwards filed a motion to reform judgment, arguing the

dismissal of his common law action for fraud conflicted with the trial court’s grant

of summary judgment in favor of Edwards on the grounds that the “as is” language

in the underlying bill of sale was not conspicuous within the meaning of the Texas

Business and Commerce Code. ACCP responded, asserting that the trial court’s

ruling that the “as is” language was not conspicuous did not give Edwards “an

automatic pass to accuse [ACCP] of fraud.” ACCP set out the elements of fraud and

argued Edwards never responded with any evidence of the elements required to

prove common law fraud.

      On September 11, 2020, Edwards filed a motion to set aside default judgment

asserting that the failure to file a response to ACCP’s motion for no-evidence

summary judgment on Edwards’ breach of contract and fraud claims was the result

of accident and mistake. Edwards requested that the trial court vacate its August 15,

2020 order granting no evidence summary judgment, order the clerk to file Edwards’

response to ACCP’s motion for no evidence summary judgment, and deny ACCP’s

motion for no evidence summary judgment.

                                        –4–
      ACCP filed a motion for sanctions against Edwards seeking its reasonable and

necessary attorney’s fees “in defending this frivolous lawsuit.” On December 28,

2020, the trial court granted ACCP’s motion for sanctions and awarded ACCP

$8187.50 in attorney’s fees and $759.77 in costs and expenses. The order stated that

the trial court, “having considered the pleadings on file and the arguments of

counsel,” was of the opinion that ACCP’s motion for sanctions should be granted.

The order also determined that Edwards’ lawsuit was “filed in bad faith and were

[sic] baseless and groundless in fact and in law at the time of its filing.”

      On January 12, 2021, ACCP filed a motion for contempt for Edwards’ refusal

to pay the awarded sanctions. On March 22, 2021, the trial court issued an agreed

final judgment dismissing with prejudice Edwards’ claims and ACCP’s

counterclaims and awarding ACCP $8187.50 in attorney’s fees and $759.77 in costs

“pursuant to Chapter 10 of the Texas Civil Practice and Remedies Code.” This

appeal followed.

                                         ANALYSIS

      In his first issue, Edwards argues the trial court erred in allowing the default

summary judgment dismissing his breach of contract and common law fraud claims

to stand. A default judgment should be set aside only if the defendant proves the

three familiar Craddock elements. See Craddock v. Sunshine Bus Lines, 134 Tex.

388, 133 S.W.2d 124, 126 (1939) (requiring new trial if defendant shows (1) default

was neither intentional nor conscious indifference, (2) meritorious defense, and (3)

                                          –5–
new trial would cause neither delay nor undue prejudice). Here, Edwards only

asserted in his motion to set aside default judgment that his failure to file a response

to ACCP’s motion for no-evidence summary judgment was the result of accident

and mistake. Well short of proving the Craddock elements, Edwards failed to

address all of the Craddock elements. See id. Under these circumstances, we

conclude the trial court did not err in not setting aside the default summary judgment.

We overrule Edwards’ first issue.

      In his second issue, Edwards argues the trial court erred in granting sanctions

under Chapter 10. We review a trial court's imposition of sanctions under an abuse

of discretion standard. Unifund CCR Partners v. Villa, 299 S.W.3d 92, 97 (Tex.

2009). An assessment of sanctions will only be reversed if the trial court acted

without reference to any guiding rules and principles, such that its ruling was

arbitrary or unreasonable. Id.

      Chapter 10 of the civil practice and remedies code provides for sanctions when

parties advance frivolous pleadings and motions. Section 10.005 provides “A court

shall describe in an order imposing a sanction under this chapter the conduct the

court has determined violated Section 10.001 and explain the basis for the sanction

imposed.” TEX. CIV. PRAC. & REM. CODE ANN. § 10.005 (West 2002). The use of

the word “shall” in the statute indicates that the requirement for particularity in the

sanction order is mandatory. Sell v. Peters Fine Art, Ltd., 390 S.W.3d 622, 624 (Tex.

                                          –6–
App.—Dallas 2012, no pet.) (citing Univ. of Tex. at Arlington v. Bishop, 997 S.W.2d

350, 355 (Tex. App.—Fort Worth 1999, pet. denied).

      Here, the order awarding sanctions stated that the trial court, “having

considered the pleadings on file and the arguments of counsel,” was of the opinion

that ACCP’s motion for sanctions should be granted. The order also determined that

Edwards’ lawsuit was “filed in bad faith and were [sic] baseless and groundless in

fact and in law at the time of its filing.” The agreed final judgment simply awarded

ACCP $8187.50 in attorney’s fees and $759.77 in costs “pursuant to Chapter 10 of

the Texas Civil Practice and Remedies Code.” We determine that it was error for

the trial court to enter the sanctions order without specifically detailing the

sanctionable conduct and explaining the basis for the sanction imposed. See id. We

conclude the trial court abused its discretion in failing to set forth facts or analysis

in the judgment to support an award of sanctions. See id.; Unifund, 299 S.W.3d at

97. We sustain Edwards’ second issue.

      We reverse the trial court’s award of sanctions in the amount of $8187.50 in

attorney’s fees and $759.77 in costs and render judgment that ACCP take nothing

on its claim for sanctions.

                                          –7–
     In all other respects, the trial court’s judgment is affirmed.

                                           /Bonnie Lee Goldstein/
                                           BONNIE LEE GOLDSTEIN
                                           JUSTICE

210301F.P05

                                        –8–
                                   S
                            Court of Appeals
                     Fifth District of Texas at Dallas
                                 JUDGMENT

SURESH EDWARDS, Appellant                    On Appeal from the Co Civil Ct at
                                             Law No 3, Harris County, Texas
No. 05-21-00301-CV          V.               Trial Court Cause No. 1152003.
                                             Opinion delivered by Justice
AHEAD OF THE CURVE                           Goldstein. Justices Myers and
COLLISION & PAINTING, LLC,                   Carlyle participating.
Appellee

      In accordance with this Court’s opinion of this date, the trial court’s award
of sanctions in the amount of $8187.50 in attorney’s fees and $759.77 in costs is
REVERSED and judgment is RENDERED that Ahead of the Curve Collision and
Painting, LLC, take nothing on its claim for sanctions. In all other respects, the
judgment of the trial court is AFFIRMED.

      It is ORDERED that each party bear its own costs of this appeal.

Judgment entered this 12th day of October 2022.

                                       –9–