Court Opinion

ID: 4176051
Source: CourtListenerOpinion
Date Created: 2017-06-09 13:16:39.529893+00
Date Added: 2024-06-11T14:23:22.678359
License: Public Domain

IN THE
                        TENTH COURT OF APPEALS

                               No. 10-16-00272-CV

WG&D MASONRY, LLC,
                                                         Appellant
v.

LONG ISLAND'S FINEST HOMES, LLC,
                                                         Appellee

                          From the 40th District Court
                              Ellis County, Texas
                             Trial Court No. 92757

                         MEMORANDUM OPINION

      WG&D Masonry, LLC, a Texas company, sued Long Island’s finest Homes, LLC,

a New York company, in Texas for breach of contract and other causes of action in

connection with two leases of short term rental homes in New York and the subsequent

withholding of the security deposit for the first lease. Long Island filed a special

appearance.   After both parties responded multiple times, attaching affidavits and

supporting documents, the trial court held a hearing and granted Long Island’s special
appearance and dismissed WG&D’s lawsuit against Long Island. Because the trial court

did not err in granting the special appearance, we affirm the trial court’s judgment.

FINDINGS OF FACT AND CONCLUSIONS OF LAW

       Initially, WG&D complains on appeal that the trial court erred in failing to file

findings of fact and conclusions of law when timely requested and timely notified they

were past due. See TEX. R. CIV. P. 296, 297. As a remedy, WG&D contends we should

either abate the appeal for findings of fact and conclusions of law or reverse the trial

court’s order dismissing WG&D’s lawsuit for lack of personal jurisdiction.

       Appeals of orders on special appearances are most commonly brought as appeals

of interlocutory orders, and findings of fact and conclusions of law are not required in

that procedural posture. See TEX. R. APP. P. 28.1(c); TEX. CIV. PRAC. & REM. CODE ANN.

§51.014(a)(7) (West 2014). Notwithstanding that, the order on Long Island’s special

appearance in this case is coupled with a dismissal of WG&D’s claims which makes it a

final judgment. However, WG&D is still not entitled to findings of fact and conclusions

of law. See TEX. R. CIV. P. 296. “The purpose of Rule 296 is to give a party a right to

findings of fact and conclusions of law finally adjudicated after a conventional trial on

the merits before the court.” Ikb Indus. v. Pro-Line Corp., 938 S.W.2d 440, 442 (Tex. 1997).

Where there is no conventional trial on the merits, findings and conclusions may be

proper, but a party is not entitled to them. See id. (findings and conclusions in dismissal

of suit as discovery sanction, helpful but not required). In this case, there was no

WG&D Masonry, LLC v. Long Island's Finest Homes, LLC                                  Page 2
conventional trial on the merits. Thus, WG&D was not entitled to findings of fact and

conclusions of law, and the trial court did not err in not providing them. 1 WG&D’s first

issue is overruled.

SPECIAL APPEARANCE

        In its second and third issues, WG&D asserts that because Barry Turk was Long

Island’s agent (second issue) and because Long Island’s contacts through Turk

established personal jurisdiction (third issue), the trial court erred in granting Long

Island’s special appearance.

        Pursuant to Rule 120a of the Texas Rules of Civil Procedure, a special appearance

may be made by any party for the purpose of objecting to the jurisdiction of the court

over the person or property of the defendant on the ground that such person or property

is not amenable to process issued by the courts of this State. TEX. R. CIV. P. 120a(1).

Whether a court has jurisdiction is a question of law that we review de novo. Moncrief

Oil Int'l, Inc. v. OAO Gazprom, 414 S.W.3d 142, 150 (Tex. 2013). "When, as here, the trial

court does not issue findings of fact and conclusions of law, we imply all relevant facts

necessary to support the judgment that are supported by evidence." Id.

1 WG&D claims that without findings of fact and conclusions of law, it is left to speculate as to the grounds
of the trial court’s order. In a special appearance, the trial court’s sole determination is whether it has
jurisdiction over a particular party. Further, when the trial court does not issue findings of fact and
conclusions of law, we imply all relevant facts necessary to support the judgment that are supported by
evidence. Moncrief Oil Int'l, Inc. v. OAO Gazprom, 414 S.W.3d 142, 150 (Tex. 2013). Thus, WG&D is still able
to present its appeal without findings of fact and conclusions of law. If the trial court had erred in failing
to file them, any error would be harmless.

WG&D Masonry, LLC v. Long Island's Finest Homes, LLC                                                   Page 3
       Texas courts have personal jurisdiction over a nonresident defendant when (1) the

Texas long-arm statute provides for it, and (2) the exercise of jurisdiction is consistent

with federal and state due process guarantees. Spir Star AG v. Kimich, 310 S.W.3d 868,

872 (Tex. 2010); Moki Mac River Expeditions v. Drugg, 221 S.W.3d 569, 574 (Tex. 2007). The

Texas long-arm statute's broad doing-business language "allows the statute to reach as

far as the federal constitutional requirements of due process will allow."          Retamco

Operating, Inc. v. Republic Drilling Co., 278 S.W.3d 333, 337 (Tex. 2009).         Under a

constitutional due-process analysis, personal jurisdiction exists when (1) the non-resident

defendant has established minimum contacts with the forum state, and (2) the assertion

of jurisdiction complies with "traditional notions of fair play and substantial justice."

Moki Mac, 221 S.W.3d at 575 (quoting Int'l Shoe Co. v. Washington, 326 U.S. 310, 316, 66 S.

Ct. 154, 90 L. Ed. 95 (1945)). We focus on the defendant's activities and expectations when

deciding whether it is proper to call the defendant before a Texas court. Int'l Shoe Co.,
326 U.S. at 316.

       A defendant's contacts with a forum can give rise to either specific or general

jurisdiction. Am. Type Culture Collection v. Coleman, 83 S.W.3d 801, 806 (Tex. 2002).

WG&D alleges that the trial court had both specific and general jurisdiction. A court has

specific jurisdiction over a defendant if the defendant's alleged liability arises from or is

related to an activity conducted within the forum. Spir Star AG v. Kimich, 310 S.W.3d 868,

873 (Tex. 2010); CSR Ltd. v. Link, 925 S.W.2d 591, 595 (Tex. 1996). In such cases, "we focus

WG&D Masonry, LLC v. Long Island's Finest Homes, LLC                                   Page 4
on the 'relationship among the defendant, the forum[,] and the litigation.'" Spir Star AG,
310 S.W.3d at 873 (quoting Moki Mac, 221 S.W.3d at 575-76). General jurisdiction is

present when a defendant's contacts with a forum are "continuous and systematic," a

more demanding minimum-contacts analysis than specific jurisdiction. Id. at 807. For

general jurisdiction purposes, we do not view each contact in isolation. Am. Type Culture

Collection v. Coleman, 83 S.W.3d 801, 809 (Tex. 2002).

       The plaintiff bears "the initial burden of pleading allegations sufficient to confer

jurisdiction," and the burden then shifts to the defendant "to negate all potential bases for

personal jurisdiction the plaintiff pled." Moncrief Oil Int'l, Inc. v. OAO Gazprom, 414
S.W.3d 142, 149 (Tex. 2013).      A defendant can negate jurisdiction either legally or

factually. Kelly v. Gen. Interior Constr., Inc., 301 S.W.3d 653, 659 (Tex. 2010). Legally, the

defendant can show that the plaintiff's alleged jurisdictional facts, even if true, do not

meet the personal jurisdiction requirements. See id. Factually, the defendant can present

evidence that negates one or more of the requirements, controverting the plaintiff's

contrary allegations. TV Azteca v. Ruiz, 490 S.W.3d 29, 36 fn. 4 (Tex. 2016). The plaintiff

can then respond with evidence supporting the allegations; and it risks dismissal of its

lawsuit if it cannot present the trial court with evidence establishing personal jurisdiction.

Id. If the plaintiff fails to plead facts bringing the defendant within reach of the long-arm

statute, the defendant need only prove that it does not live in Texas to negate jurisdiction.

Kelly, 301 S.W.3d. at 558-559. If the parties present conflicting evidence that raises a fact

WG&D Masonry, LLC v. Long Island's Finest Homes, LLC                                    Page 5
issue, we will resolve the dispute by upholding the trial court's determination. See

Retamco Operating, Inc. v. Republic Drilling Co., 278 S.W.3d 333, 337 (Tex. 2009); see also

BMC Software Belgium, N.V. v. Marchand, 83 S.W.3d 789, 795 (Tex. 2002).

Agent

        We must first decide whether Turk was Long Island’s agent. Because there are no

findings of fact and conclusions of law, the trial court impliedly found Turk was not Long

Island’s agent. To be an agent, a person must (1) act for and on behalf of another person

and (2) be subject to that person's control. Stanford v. Dairy Queen Prods., 623 S.W.2d 797,

801 (Tex. App.—Austin 1981, writ ref'd n.r.e.). Both elements are required; "the absence

of one will prevent the conclusion that an agency relationship exists." Id. An independent

contractor, on the other hand, may act for and in behalf of another; but since he is not

under the other's control, an agency relationship does not exist. Bertrand v. Mut. Motor

Co., 38 S.W.2d 417, 418 (Tex. Civ. App.—Eastland 1931, writ ref’d). Accord Stanford, 623
S.W.2d at 801. Thus, absent proof of control, there is no agency. St. Joseph Hosp. v. Wolff,

94 S.W.3d 513, 542 (Tex. 2002) ("The right of control is the 'supreme test' for whether a

master-servant relationship, rather than an independent contractor relationship, exists.");

Webster v. Lipsey, 787 S.W.2d 631, 635 (Tex. App.—Houston [14th Dist.] 1990, writ denied)

("essential element of proof of agency" is that alleged principal has right to assign agent's

task and to control means and details of process).

        WG&D contends that Turk was Long Island’s agent because he was listed on Long

WG&D Masonry, LLC v. Long Island's Finest Homes, LLC                                   Page 6
Island’s website as a member of its “team,” and when Wendy Hernandez, the majority

owner and member-manager of WG&D, contacted Long Island through its website, Turk

replied to her through an email associated with Long Island.2 However, in its amended

special appearance, Long Island asserted by affidavit of Jonas J. Wagner, its president,

that Turk was an independent contractor, not Long Island’s agent. There is no evidence

in the record to show that Long Island had any control over Turk. Long Island’s name

was not on any of the leases entered into by WG&D, payments of rents and security

deposits were not wired to Long Island’s bank account, and Turk admitted he withheld

WG&D’s security deposit, not Long Island. Thus, there is nothing in the record to

establish that Turk was Long Island’s agent. Accordingly, the trial court did not err in

impliedly finding that Turk was not Long Island’s agent, and we overrule WG&D’s

second issue.

Personal Jurisdiction

          We now look to whether Long Island, itself, not through the actions of Turk,

purposely availed itself of the privileges of doing business in Texas so as to subject itself

to personal jurisdiction in Texas.

          WG&D sued Long Island for breach of contract, bad faith retention of security

deposit, civil theft, conversion, and unjust enrichment/quantum meruit, each stemming

from the same series of transactions allegedly with Long Island. WG&D alleged that

2
    The remaining emails from Turk were through an “AOL” address, not Long Island’s address.

WG&D Masonry, LLC v. Long Island's Finest Homes, LLC                                           Page 7
Long Island engaged in the business of offering short-term leases of homes in or around

Long Island, New York to Texas residents and solicited Texas residents, like WG&D to

lease homes in New York. Specifically, WG&D alleged that it entered into a lease

agreement with Long Island for a home in New York which was performed in whole or

in part in Texas; that Long Island negotiated the terms of the lease in Texas via telephone,

electronic mail, and/or fax and presented the final draft of the lease to WG&D by fax for

signature in Texas; and that WG&D wired its security deposit, “realtor fee,” and monthly

rental payments from Texas to Long Island in accordance with the lease. WG&D claimed

that at the conclusion of the lease, Long Island communicated with WG&D via telephone,

electronic mail, and/or fax regarding the return of the security deposit and that Long

Island failed and wrongfully refused to return the deposit.

       Long Island filed a special appearance asserting that the trial court did not have

jurisdiction over Long Island because Long Island was not a Texas company, did not

maintain an office or branch in Texas or have any employees in Texas; did not own or

lease any property in Texas, did not solicit business in Texas, did not purposefully direct

its activities toward Texas, was not amendable to process issued by a Texas court, and

has not done any act or consummated any transaction in Texas that would allow the court

to exercise personal jurisdiction over it. It further asserted that any contacts by Long

Island with the State of Texas were random, isolated and fortuitous.

       In response, WG&D filed an affidavit of Wendy Hernandez who stated that based

WG&D Masonry, LLC v. Long Island's Finest Homes, LLC                                  Page 8
on the recommendation of a Texas company which had previously leased from Long

Island,3 WG&D called “Barry Turk of Long Island's Finest Homes,” to inquire about

property to rent in New York. Hernandez asserted she received proposed leases from

Turk, ultimately negotiated a lease with Turk, wired money to Long Island, and signed a

lease and faxed it back to Turk. Hernandez attached copies of the leases, the fax cover

sheets, letters from Turk, and the wire transfers. Long Island’s letterhead appears on the

fax cover sheets and letters from Turk which accompanied the leases.          The leases

themselves made no mention of Long Island. The wire transfers, appearing to be filled

out by WG&D, indicated that some of the money was sent to a bank account under Turk’s

name and Long Island’s name.

          Hernandez also asserted in her affidavit that she and Turk exchanged emails

regarding issues with the rented property, renting different property, wiring more

money, and the return of the security deposit. However, the documents attached to the

affidavit indicate that the emails from Turk originated from an AOL account, not from an

account associated with Long Island. Further the lease signed by WG&D did not include

any letterhead or fax coversheet from Long Island. Also, the wire transfers did not

consistently indicate to whom the money was sent. Some of the wire transfer documents

which used a Chase Bank account ending in “30” indicated the money was sent to Barry

Turk or to Turk and Long Island while some indicated the money was sent to a different

3
    No documentation of this transaction was included with the affidavit.

WG&D Masonry, LLC v. Long Island's Finest Homes, LLC                                Page 9
Chase Bank account number and a different person, Lindon Morrison. Hernandez did

not explain whether or not Morrison had any connection to Long Island.4

        WG&D’s response prompted Long Island to file a first amended special

appearance in which Long Island contended neither general nor specific jurisdiction

existed. In support of this contention, Long Island attached the affidavit of Jonas J.

Wagner, Long Island’s president. In his affidavit, Wagner stated Barry Turk was a real

estate broker who occasionally performed work on an independent contract-basis for

Long Island until his contract was terminated on June 5, 2015. He also stated Long Island

was unaware of the contacts between WG&D and Turk until after Long Island was sued

and never authorized Turk to use Long Island’s name, or anything else in connection

with any contract, agreement, communication or document by or between WG&D and

Turk. Wagner confirmed that the email address used in email communications between

Turk and WG&D was not Long Island’s email address.

        Wagner further asserted that Long Island never entered into a business

relationship, contract, or agreement with WG&D, never received money from WG&D,

and never solicited business from WG&D in Texas. Wagner confirmed that the bank

account number on the documented wire transfers “has never been” Long Island’s bank

account. He then reasserted that Long Island: 1) never solicited any business in Texas;

2) never conducted business in Texas; 3) had no office in Texas; 4) owned no property in

4
 The documents attached to Hernandez’s affidavit indicate Morrison was the landlord for the second lease
signed by WG&D.

WG&D Masonry, LLC v. Long Island's Finest Homes, LLC                                            Page 10
Texas; 5) had no registered agent for service of process in Texas; 6) had no employees in

Texas; 7) never advertised in Texas; 8) did not visit Texas in connection with the lease of

any property to WG&D; and 9) had not visited Texas in connection with the lease of any

other property.

       Not to be outdone, WG&D responded to the amended special appearance and

attached another affidavit from Hernandez. In that affidavit, and contrary to her initial

affidavit, Hernandez stated that, based on the recommendation of the company

mentioned in her previous affidavit, Hernandez visited Long Island’s website and visited

the “Meet our Team” page. She attached a copy of that page as it purportedly appeared

in April of 2015. Turk is listed on that page. Hernandez stated that after visiting the page,

she filled out information on a “Contact Us” page on Long Island’s website. Attached to

the affidavit is a copy of that page as it purportedly appeared in April of 2015. Hernandez

asserted that after she filled out the “contact us” information, Turk responded to her

though an email account associated with Long Island. Hernandez responded to Turk at

the same email address. Copies of those emails are attached to the affidavit. A copy of

Turk’s Long Island business card allegedly given to Hernandez by Turk is also attached.

       Lastly, Long Island supplemented its first amended special appearance with an

unsworn declaration by Turk. See TEX. CIV. PRAC. & REM. CODE ANN. § 132.001 (West

2011) (“(a) … an unsworn declaration may be used in lieu of a written sworn

declaration…or affidavit….”). Turk stated that Chase Bank account ending in “30” was

WG&D Masonry, LLC v. Long Island's Finest Homes, LLC                                  Page 11
his bank account and was not an account affiliated with Long Island. He also stated that

Suey Tan was the real estate broker and Turk was the real estate agent in connection with

the first lease to WG&D and that Tan and Turk shared the realtor fee in connection with

the lease. Turk affirmed that he held the security deposit for the lease and transferred

the security deposit to another lease by WG&D, but that when WG&D held over on that

second lease, Turk withheld the entire security deposit as damages.

Application

       From the evidence described above, the contacts which WG&D asserts establish

the trial court’s jurisdiction over Long Island were either to or from Turk. We have

already held that Turk was not Long Island’s agent. Based on the evidence presented,

Long Island conducted no activity within and had no continuous and systemic contacts

with Texas. Thus, the trial court does not have specific or general jurisdiction over Long

Island. Further, since WG&D failed to plead facts bringing Long Island within reach of

the long-arm statute, to negate jurisdiction, Long Island needed only to prove, and did

so, that it does not “live” in Texas. Accordingly, the trial court did not err in granting

Long Island’s special appearance, and WG&D’s third issue is overruled.

CONCLUSION

       Having overruled each issue on appeal, the trial court’s judgment is affirmed.

                                           TOM GRAY
                                           Chief Justice

WG&D Masonry, LLC v. Long Island's Finest Homes, LLC                               Page 12
Before Chief Justice Gray,
       Justice Davis, and
       Justice Scoggins
Affirmed
Opinion delivered and filed June 7, 2017
[CV06]

WG&D Masonry, LLC v. Long Island's Finest Homes, LLC   Page 13