Court Opinion

ID: 4045681
Source: CourtListenerOpinion
Date Created: 2016-09-28 23:56:01.143812+00
Date Added: 2024-06-11T14:29:55.680617
License: Public Domain

ACCEPTED
                                                                  01-14-00317-CV
                                                        FIRST COURT OF APPEALS
                                                                HOUSTON, TEXAS
                                                             1/28/2015 4:31:00 PM
                                                              CHRISTOPHER PRINE
                                                                           CLERK

             01-14-00317-CV
                                                  FILED IN
                    In the                 1st COURT OF APPEALS
                                               HOUSTON, TEXAS
          First Court of Appeals           1/28/2015 4:31:00 PM
                                           CHRISTOPHER A. PRINE
             Houston, Texas                        Clerk

            Pelco Construction, Co.
                                           Appellant,
                   v.
Chambers County, Texas, Kurt Amundson and
        Amundson Consulting, Inc.
                                       Appellees.

On Appeal from the 334th Judicial District Court
          Chambers County, Texas
      Trial Court Cause No. CV26356

              Appellee’s Brief

                       Mills Shirley L.L.P.
                       2228 Mechanic St., Ste. 400
                       Galveston, Texas 77550
                       409.761.4001

                       Robert E. Booth
                       Texas Bar No. 24040546
                       rbooth@millsshirley.com

                       Attorney for Appellees
                       Kurt Amundson and
                       Amundson Consulting, Inc.

    Oral Argument Requested
                      IDENTITY OF PARTIES AND COUNSEL

Appellate Counsel for Plaintiff/Appellant

     Pelco Construction Company:

     Appellate Counsel:

     Daryl L. Moore
     Texas Bar No. 14327420
     daryl@heightslaw.com
     Daryl L. Moore, P.C.
     1005 Heights Boulevard
     Houston, Texas 77008
     713.529.0048

     Trial Counsel:

     Fredrick L. McGuire
     Texas Bar No.24001190
     rickmcguire@rickmcguire.com
     Etta Davidson
     Texas Bar No. 07495750
     etta@rickmcguire.com
     Law Office of Frederick L. McGuire
     714 Main Street
     Liberty, Texas 77575
     936.336.9809

                                    -i-
Defendant/Third-party plaintiff/Appellee

     Chambers County, Texas

     Trial and Appellant Counsel:

     Nathan M. Brandimarte
     Texas Bar No. 24026915
     nmb@obt.com
     James H. Chesnutt
     Texas Bar No. 04187500
     jhc@obt.com
     Robert L. Florance
     Texas Bar No. 24087520
     rflorance@obt.com
     Orgain, Bell & Tucker, LLP
     470 Orleans Street
     Beaumont, Texas 77701
     409.838.6412

                                    - ii -
Defendants/Appellees

     Kurt Amundson and Amundson Consulting, Inc.

     Counsel at trial:

     Jack C. Brock
     Texas Bar No. 03040800
     jbrock@millsshirley.com
     Robert E. Booth
     Texas Bar No. 24040546
     rbooth@millshirley.com
     Mills Shirley L.L.P.
     2228 Mechanic St., Ste. 400
     Galveston, Texas 77550
     409.763.2341

     Counsel on appeal:

     Robert E. Booth
     Texas Bar No. 24040546
     rbooth@millsshirley.com
     Mills Shirley L.L.P.
     2228 Mechanic St., Ste. 400
     Galveston, Texas 77550
     409.761.4001

                                   - iii -
                                        TABLE OF CONTENTS

Identity of Parties and Counsel ..................................................................... i

Table of Contents ....................................................................................... iv

Index of Authorities ................................................................................... vi

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

Issues Presented ........................................................................................... 2

Responsive Statement of Facts ..................................................................... 2

        A. Chambers County contracts with Dannenbaum to design the
           Oaks Island Fire Station. ................................................................ 3

        B. Dannenbaum contracts with Amundson Consulting for staff
           support services. ............................................................................ 3

        C. Chambers County moves forward to the construction phase of
           the Project. .................................................................................... 4

        D. Pelco Construction submits a winning bid and contracts
           directly with Chambers County...................................................... 5

        E. The Project construction begins. ..................................................... 5

        F. Chambers County temporarily suspends the Project at its
           discretion. ...................................................................................... 6

        G. The course of proceedings at the trial court. ................................... 6

Summary of Argument ................................................................................ 9

Argument and Authorities ........................................................................... 9

                                                    - iv -
   1. The Standard of Review ..................................................................... 9

   2. Kurt Amundson cannot be individually liable to Pelco because he
      provided services to Chambers County and the Project under
      Amundson Consulting’s contract with Dannenbaum Engineering. ...... 9

   3. Kurt Amundson and Amundson Consulting cannot be liable to
      Pelco for misrepresentations as a matter of law. ................................ 13

       A. Pelco appeals claims arising from the pre-bid conference and
          abandons claims arising from the suspension of work. ................. 13

       B. Pelco cannot justifiably rely on pre-contract oral statements
          regarding FEMA funding because its contract with Chambers
          County does not provide that payments are contingent upon
          FEMA reimbursement. ................................................................. 14

       C. Amundson established that his statements could have been
          fraud because the dispute regarding reimbursement arose after
          the pre-bid conference. ................................................................. 16

       D. If the Court correct granted summary judgment for Chambers
          County, than Pelco cannot maintain claims against Amundson
          because Pelco’s improper termination of the contract is the
          proximate cause of its damages. ................................................... 16

Conclusion and Prayer............................................................................... 17

                                                 -v-
                                           INDEX OF AUTHORITIES
         Cases

DeClaire v. G & B Mcintosh Family Ltd. P’ship, 260 S.W.3d 34 (Tex.
 App. —Houston [1st Dist.] 2008, no pet.) ........................................................ 15

Dew v. Crown Derrick Erectors, Inc., 208 S.W.3d 448 (Tex. 2006). .................. 18

Formosa Plastics Corp. USA v. Presidio Engineers & Contractors,
  Inc., 960 S.W.2d 41, 46-48 (Tex. 1998). .......................................................... 10

Gulf Liquids New River Project, LLC v. Gulsby Eng'g, Inc., 356
S.W.3d 54 (Tex. App.—Houston [1st District] 2011, no pet.) ........................... 17

H2O Solutions, Ltd. v. PM Realty Grp., LP, 438 S.W.3d 606 (Tex.
 App.—Houston [1st Dist.] 2014), reh'g overruled (Aug. 14, 2014),
 review denied (Jan. 16, 2015). .......................................................................... 15

IKON Office Solutions, Inc. v. Eifert, 125 S.W.3d 113 (Tex. App.—
  Houston [14th Dist.] 2003, pet. denied ............................................................ 16

In re HRM Holdings, LLC, 421 B.R. 244 (Bankr. N.D. Tex. 2009 ..................... 11

Menetti v. Chavers, 974 S.W.2d 168 (Tex. App.—San Antonio 1998,
 no pet.). ............................................................................................................ 10

Ocram, Inc. v. Bartosh, 2012 WL 4740859 (Tex. App.—Houston [1st
 Dist.] Oct. 4, 2012) .......................................................................................... 11

Rutherford v. Atwood, No. 01-00-0113-CV, 2003 WL 22053687
 (Tex. App.—Houston [1st Dist.] Aug. 29, 2003, no pet). ................................. 12

Valence Operating Co. v. Dorsett, 164 S.W.3d 656 (Tex.2005). ........................... 9

         Statutes

TEX. BUS. ORG. CODE § 21.223...................................................................... 10, 11

                                                         - vi -
                            Statement of the Case

        Appellee agrees with the statement of case presented by Appellee

Chambers County, Texas with the following additions:

Nature of the Suit        Pelco sued Kurt Amundson and his wife Margie
                          Amundsen1 in their individual capacities, and
                          Amundson Consulting, Inc. for fraud, negligence and
                          negligent misrepresentation. 4CR1035; 7CR4075-
                          4077.

Pretrial Proceedings      Margie Amundsen filed a special appearance and was
                          subsequently nonsuited from the lawsuit by Pelco
                          without a hearing. 3CR1713. Kurt Amundson
                          moved for summary judgment regarding his
                          individual liability and Amundson Consulting moved
                          for summary judgment based upon the economic loss
                          doctrine. 6CR3798-3817. At hearing the trial court
                          stated it was prepared to grant summary judgment in
                          favor of Kurt Amundson individually, but wanted to
                          defer the defense economic loss as to Amundson
                          Consulting and enter an order consistent with the
                          other rulings in favor of Chambers County. 3RR63-
                          64. Amundson passed the hearing and subsequently
                          filed another summary judgment on Pelco’s claims.
                          7CR4259. The trial court then granted a single take-
                          nothing summary judgment in favor of Kurt
                          Amundson and Amundson Consulting. 7CR4581.
                          This summary judgment order was merged into the
                          final judgment. 8CR4934.

1
    This is the correct spelling; Margie J. Amundsen retains her maiden name.
To The Honorable First Court of Appeals:

        Appellees Kurt Amundson and Amundson Consulting, Inc., submit this

opening brief and request the Court affirm the orders of the trial court order

of summary judgment against Appellant’s claims.2

                                Issues Presented

        Reply to Issue IV. The trial court correctly granted the motion for

summary judgment because there can be no liability against Kurt Amundson

individually and Pelco’s claims against Amundson Consulting fail as a matter

of law.

                       Responsive Statement of Facts

        Hurricane Ike struck the upper Texas coast causing damage to the

Chambers County Oak Island Volunteer Fire Station. The Federal

Government allocated funding to reimburse Chambers County to rebuild.

FEMA administered this funding.

2
    References to the Clerk’s Record will be [Volume] CR [page] and SCR
    [page]. References to the Reporter’s Record will be RR [page].

                                        2
     A. Chambers County contracts with Dannenbaum to design the Oaks
        Island Fire Station.

     Dannenbaum entered into the Master Services Agreement (the “MSA”)

with Chambers County to rebuild the Oak Island Fire Station (the

“Project”). 3CR1608-1622.

     For purposes of the Project, Alan Hirshman and architect Steven

McGarraugh provided services to Engineering Company – Houston, LLC in

their capacities as design professionals for Dannenbaum Engineering

Corporation. 3CR1567; see also 6RR150.

     The MSA provided for two phases. 3CR1608-1622. Phase I consisted

of assessment and design and Phase II involved the construction and contract

management. See id.

     B. Dannenbaum contracts with Amundson Consulting for staff
        support services.

     For 28 years, Kurt Amundson has assisted local governments in

obtaining and implementing FEMA public assistance to complete projects to

repair damages sustained from disasters. 3CR1568; 3CR1585-1587.

Amundson and his wife Margie Amundsen own Amundson Consulting

which is the company Amundson uses to conduct business. Id.

     Amundson Consulting entered into a Staff Support Agreement with

Dannenbaum whereby Amundson Consulting provided “technical support

                                     3
personnel … to work under the supervision, direction and control of

Engineer.” 3CR1624-1627.

     For his work under this agreement, Kurt Amundson used the email

address “kurt.amundson@dannenbaum.com” and identified himself to

Chambers County and Pelco as working for Dannenbaum. 3CR1568. Kurt

Amundson did not use his company’s name in dealing with Chambers

County or Pelco. 3CR1585-1587. Amundson’s actions regarding the Project

were directed and controlled by Dannenbaum’s design professional, Alan

Hirshman. Id.

     C. Chambers County moves forward to the construction phase of the
        Project.

     After getting approval from FEMA for reimbursement, Chambers

County asked Dannenbaum to submit an amendment to the Project

Worksheet to cover increased design and construction costs. Amundson

corresponded with FEMA justifying increases to the already approved

Project Worksheet. 7CR4096

     While the amendment was pending, Chambers County moved forward

to Phase II of the MSA.

                                     4
     D. Pelco Construction submits a winning bid and contracts directly
        with Chambers County.

     Pelco attended a pre-bid conference for the Project. See 6RR151.

Hirshman and Kurt Amundson represented Chambers County at the

conference and answered questions of the potential bidders. 6CR3800. In

particular, Hirshman highlighted that the Project differed from other

Chambers County projects because the County was seeking reimbursement

from FEMA, and then he explained various details of the design necessitated

by FEMA’s requirements. See 6RR53-54. In particular, Dannenbaum’s

drawings contained a sophisticated flood resistant foundation.

     Pelco submitted the winning bid and entered into a standard AIA form

contract with Chambers County for construction of the Project. 6CR3556.

This contract does not mention that Chambers County’s costs on the Project

are FEMA reimbursable nor does it not make the County’s payment

obligations contingent upon FEMA reimbursement. 6CR3644.

     E. The Project construction begins.

     Dannenbaum provided stamped construction plans and Pelco began

construction. Kurt Amundson served as Pelco’s primary point of contact for

Dannenbaum. 3CR1586. At Hirshman’s instruction, Kurt Amundson

                                      5
monitored Pelco’s construction to ensure compliance with the contract terms,

conditions, and specifications. Id.

      F. Chambers County temporarily suspends the Project at its discretion.

      On or about October 28, 2010, Chambers County directed

Dannenbaum to temporarily suspend Pelco’s work in order to get approval

of the amended Project Worksheet. 6CR3556.

      Forty days later, FEMA approved the amendment and Hirshman

informed Pelco to remobilize. Id.

      Pelco did not remobilize, and sent a “Seven-day notice of termination”

letter invoking Article 14 of its contract with the County, which allows Pelco

to terminate in the event of “issuance of an order of a court or other public

authority having jurisdiction which requires all Work to be stopped;…”

6CR3556-3557, 3562. Pelco reasoned that FEMA required the work to be

stopped. 6CR3557; 3664-70.

      Unfortunately, for Pelco, it was Chambers County who suspended the

work, not FEMA. 6CR3556.

      G. The course of proceedings at the trial court.

      Pelco’s filed suit claiming it “had the right to terminate the contract

with Chambers County on the grounds that work was stopped in excess of

                                       6
thirty consecutive days by an order of a governing agency which

jurisdiction….” 1CR37. Pelco maintained this claim at trial. 7CR4066.

      After deposing a FEMA representative, Pelco learned that FEMA did

not order the work to stop, nor did it have jurisdiction to order a stop to

Pelco’s work.

      Subsequently, Pelco filed a first amended petition alleging claims

against Dannenbaum, Alan Hirshman and Steven McGarraugh (the

“Dannenbum Defendants”) and Amundson Consulting, Inc., Kurt

Amundson and Margie Amundsen. 1CR349-351; 2CR1033-1035. Margie

Amundsen filed a special appearance and was subsequently nonsuited from

the lawsuit by Pelco without a hearing. 3CR1713.

      The trial court dismissed the Dannenbaum Defendants, Kurt

Amundson and Amundson Consulting for failure to comply with Civil

Practices & Remedies Code 150.002 by providing a certificate of merit. 3CR

1470; 3CR1798. The First Court of Appeals upheld the dismissal of the

Dannenbaum Defendants but reversed as to the Amundsons. Pelco Constr.,

Inc. v. Dannenbaum Eng'g Corp., 404 S.W.3d 48, 54–55 (Tex. App.—

Houston [1st Dist.] 2013, no pet.).

                                       7
      After the appeal, Kurt Amundson moved for summary judgment

regarding his individual liability and Amundson Consulting moved for

summary judgment based upon the economic loss doctrine. 6CR3798-3817.

      On November 22, 2013, the Court heard and granted Chambers

County’s third motion for summary judgment filed on October 29, 2013,

thereby dismissing Pelco’s breach of contract and Prompt Payment claims.

7CR4258; 3RR35-36.

      During this same hearing, the Court heard argument on the Amundson

Defendants’ motion for summary judgment on economic loss and individual

liability. 3RR47-64. Ultimately, the trial court stated it was prepared to

grant summary judgment in favor of Kurt Amundson individually, but

wanted to defer economic loss as to Amundson Consulting and enter an

order consistent with the other rulings in favor of Chambers County.

3RR63-64.

      Subsequently, the Amundson Defendants filed another summary

judgment on Pelco’s misrepresentation claims based upon the Court’s

findings of fact and prior orders. 7CR4581. Amundson Consulting’s motion

argues for summary judgment because the trial court granted summary

judgment on Pelco’s contract claims against Chambers County holding that

Pelco unreasonably terminated its contract. As such Pelco did not justifiably

                                       8
or reasonably rely on Amundsons’ representations as a matter of law and

Pelco’s alleged damages were not proximate caused by the Amundsons.

7CR4266-4270. Pelco opposed the motion. 7CR4548.

       The trial court granted a take-nothing summary judgment in favor of

Kurt Amundson and Amundson Consulting, Inc. 7CR4581-82.

                           Summary of Argument

     The trial court properly granted Appellees’ motion for summary

judgment.

                        Argument and Authorities

1.      The Standard of Review

       The Appellate Court reviews summary judgments de novo. Valence

Operating Co. v. Dorsett, 164 S.W.3d 656, 661 (Tex.2005). A movant is

entitled to traditional summary judgment if (1) there are no genuine issues as

to any material fact and (2) the moving party is entitled to judgment as a

matter of law. Tex. R. Civ. P. 166a(c).

2.      Kurt Amundson cannot be individually liable to Pelco because he
        provided services to Chambers County and the Project under
        Amundson Consulting’s contract with Dannenbaum Engineering.

       Individuals contracting on behalf of corporations are shielded

from personal liability as long as they do not disregard the corporate

structure. See TEX. BUS. ORG. CODE § 21.223. “As a general rule, the

                                      9
failure to perform the terms of a contract is a breach of contract, not a

tort,” and the mere failure to perform a contract is not evidence of

fraud. Formosa Plastics Corp. USA v. Presidio Engineers &

Contractors, Inc., 960 S.W.2d 41, 46-48 (Tex. 1998).

     A finding of contract liability against a corporation does not

necessarily amount to a finding of liability against individuals. “The

corporate structure is designed to shield shareholders from just such

liability.” Menetti v. Chavers, 974 S.W.2d 168, 171 (Tex. App.—San

Antonio 1998, no pet.). The purpose of a corporation is to protect

persons from personal liability.

     Under the Texas Business Organizations Code §21.223 there is

only a viable claim to disregard a corporate structure if there was: (1)

an actual fraud perpetrated and (2) such fraud directly benefitted the

alleged perpetrator(s). See In re HRM Holdings, LLC, 421 B.R. 244,

248 (Bankr. N.D. Tex. 2009 (emphasis in original). If there is legal or

factually insufficient evidence of a direct personal benefit to an owner

resulting from fraud, the corporate disregard finding cannot stand.

                                    10
        Even if factually sufficient evidence of fraud existed, 3 there is no

claim or evidence of a direct personal benefit to Kurt Amundson. Texas

courts have held the “direct personal benefit” required by the Code

must “relate to the transaction at issue.” Ocram, Inc. v. Bartosh, 2012
WL 4740859, *3 (Tex. App.—Houston [1st Dist.] Oct. 4, 2012);

Rutherford v. Atwood, No. 01-00-0113-CV, 2003 WL 22053687 (Tex.

App.—Houston [1st Dist.] Aug. 29, 2003, no pet). Thus in Rutherford,

evidence that a corporation’s sole shareholder and corporate officer

drew money from the corporate bank account when he needed it for

personal matters such as car payments, his personal home mortgage, or

investments; and that he issued corporate checks to his wife, although

she rendered no services to the corporation, was legally insufficient to

support a verdict of corporate disregard because the personal draws

were not related to the transaction at issue. Id.

        In this case, Dannenbaum contracted with Amundson Consulting,

Inc. and not with Kurt Amundson individually. 6CR3847. Pelco’s

manager Michael Ramirez knew that Kurt Amundson worked for

Dannenabum and not in his individual capacity. 6CR3820-3821.

3
    This statement does not constitute an admission of fraud.

                                       11
      Kurt Amundson was a staff member for Amundson Consulting

and all interactions with others were explicitly made on behalf of

Amundson Consulting in its capacity as a staff support for

Dannenbaum. See 6CR3847; see also 6CR3820-3821. Dannenbaum

paid Amundson Consulting for services performed under the Staff

Support Agreement. 3CR1792-1793. Amundson Consulting then paid

Kurt Amundson as a W-2 employee for the same work performed under

the Staff Support agreement. Id. Kurt Amundson was only employee

Amundson Consulting assigned to work under Dannenbaum’s control.

Id.

      Pelco’s primary point of contact for Dannenbaum was Kurt

Amundson. 3CR1690. As such of Pelco’s “correspondence, phone calls and

e-mails” to the engineer were sent through Kurt Amundson. Id. For his work

under this agreement, Kurt Amundson used the email address

“kurt.amundson@dannenbaum.com” and identified himself to Chambers

County and Pelco as working for Dannenbaum. 3CR1568. Kurt Amundson

did not use his company’s name in dealing with Chambers County or Pelco.

3CR1585-1587.

      The Court properly granted summary judgment in favor of Kurt

Amundson individually.

                                   12
3.    Kurt Amundson and Amundson Consulting cannot be liable to Pelco
      for misrepresentations as a matter of law.

      A. Pelco appeals claims arising from the pre-bid conference and
         abandons claims arising from the suspension of work.

      In the trial court, Pelco’s response argued that Amundson made two

misrepresentations: (1) An oral statement during the pre-bid conference that

the Project was approved by FEMA; and (2) An oral statement that FEMA

ordered the suspension in work. 7CR4551-4554.

      On appeal, Pelco abandons the claims arising from the suspension of

work, and only argues that but for Amundson’s alleged oral representations

that “FEMA funding was approved and in place for the project to go

forward, with no remaining paperwork to be done,” Pelco would not have

bid on the Project. Appellant’s Brief at 29.

      Since Pelco abandoned it claims arising from the suspension of work

the Court of Appeals should uphold the judgment against Pelco’s claims

against Amundson arising from the suspension of work.

      Even if the claims arising out of suspension of work has not been

abandoned, Pelco’s trial counsel conceded that Pelco did not have the right

to terminate the contract. 2RR20.

                                      13
      B. Pelco cannot justifiably rely on pre-contract oral statements
         regarding FEMA funding because its contract with Chambers
         County does not provide that payments are contingent upon FEMA
         reimbursement.

      A party cannot justifiably rely on a statement that directly contradicts

the express terms of the parties’ written agreement. DeClaire v. G & B

Mcintosh Family Ltd. P’ship, 260 S.W.3d 34, 46–47 (Tex. App. —Houston

[1st Dist.] 2008, no pet.); H2O Solutions, Ltd. v. PM Realty Grp., LP, 438
S.W.3d 606, 625 (Tex. App.—Houston [1st Dist.] 2014), reh'g overruled

(Aug. 14, 2014), review denied (Jan. 16, 2015).

      Amundson’s efforts to educate Pelco about the design was intended to

ensure the County obtained a facility that complied with FEMA standards.

Pelco’s allegations of fraud are nothing more a leaps of logic turning a

representation about a project being reimbursable from FEMA into a

representation that the project 100% funded.

      Whether or not FEMA approved the amendment to the Project

Worksheet at the time of the pre-bid conference is of no consequence because

Pelco’s compensation was not contingent upon Chambers County receiving

FEMA’s reimbursement. 6CR3644. Regardless, FEMA never revoked its

funding, and ultimately, the amendment was approved. 7CR4165.

                                      14
      Furthermore, the contract contains an entireties clause which would

merge prior representations into the contract. 7CR4286. This merger clause

expressly covers oral representation and prohibits evidence of additional pre-

contract terms from serving as the basis for a fraudulent inducement claim.

See IKON Office Solutions, Inc. v. Eifert, 125 S.W.3d 113, 125–28 (Tex.

App.—Houston [14th Dist.] 2003, pet. denied) (providing that provisions

that contract was “entire agreement” and requiring any modifications to be

in writing barred fraudulent-inducement claim under Schlumberger ). Gulf

Liquids New River Project, LLC v. Gulsby Eng'g, Inc., 356 S.W.3d 54, 75

(Tex. App.—Houston [1st District] 2011, no pet.)

      Pelco argues that there is nothing in the record to indicate that

Amundson’s alleged misrepresentations at the pre-bid conference were

“made on behalf of Chambers County.” Appellant’s Brief at 32 FN 10. But

Pelco conceded this fact in its petition on file at the time of the summary

judgment hearing. 7CR4058-4059. As such, the contract’s merger clause

would integrate Amundson’s alleged misrepresentations and preclude Pelco’s

fraud claim.

                                      15
      C. Amundson established that his statements could have been fraud
         because the dispute regarding reimbursement arose after the pre-bid
         conference.

      The pre-bid conference occurred in April 2010. 7CR4274. On June 8th,

Pelco entered into the contract for construction of the Project. 7CR4060. Two

days later on June 10th, FEMA first disputed whether the last amendment to

the design was reimbursable. Id.

      When Amundson made the alleged misrepresentation. Chambers

County and Amundson did not yet know that FEMA would dispute the

reimbursement eligibility for a small portion of the Project. As such, it is

impossible for Amundson to have known that his alleged misrepresentation

was false.

      D. If the Court correct granted summary judgment for Chambers
         County, than Pelco cannot maintain claims against Amundson
         because Pelco’s improper termination of the contract is the
         proximate cause of its damages.

      The trial court determined that Pelco had no right to terminate the

Contract based upon the 40-day suspension. 7CR43564. Pelco’s remaining

claims against Amundson arise from damages sustained resulting from its

improper termination of its contract with Chambers County.

      Pelco’s later decision to improperly terminate the contract with

Chambers County is unrelated to Amundson’s pre-bid representations and is

                                       16
the sole proximate cause of its damages. “A new and independent cause is

one that intervenes between the original wrong and the final injury such that

the injury is attributed to the new cause rather than the first and more

remote cause.” Dew v. Crown Derrick Erectors, Inc., 208 S.W.3d 448, 450

(Tex. 2006). The intervening cause relieves the original wrongdoer of

liability for negligence because the intervening negligence destroys “the

causal connection between [the original] negligence and the plaintiff's

injury[.]” Id.

                          Conclusion and Prayer

      For the reasons stated in this brief, Kurt Amundson and Amundson

Consulting, Inc. request the Court affirm the order of summary judgment

and final judgment below. Appellees also request any other proper relief.

                                      17
                                         Respectfully submitted,

                                         Mills Shirley L.L.P.
                                         2228 Mechanic St., Ste. 400
                                         Galveston, Texas 77550
                                         Telephone: 409.761.4001
                                         Facsimile: 409.763.2879

                                         By: /s/ Robert E. Booth
                                            Robert E. Booth
                                         Texas Bar No. 24040546
                                         rbooth@millsshirley.com

                                         ATTORNEYS FOR APPELLEES

                                         Kurt Amundson
                                         Amundson Consulting, Inc.

                           Certificate of Service

      As required by TEX. R. APP. P. 6.3 and 9.5(b), (d), (e), I certify that I
served a correct copy of this document to all counsel of record on January
28, 2015.

                                            /s/ Robert E. Booth
                                            Robert E. Booth

                                            01/28/2015
                                            Date

                                       18
                       Certificate of Compliance

     I certify that this document was produced on a computer using
Microsoft Word 2013 and contains 2,723 words, as determined by the
computer software’s word-count function, excluding the sections of the
document listed in Texas Rule of Appellate Procedure 9.4(i)(1).

                                         /s/ Robert E. Booth
                                         Robert E. Booth

                                         01/28/2015
                                         Date

                                    19