Court Opinion

ID: 4557937
Source: CourtListenerOpinion
Date Created: 2020-08-22 05:11:46.871609+00
Date Added: 2024-06-11T09:51:40.675002
License: Public Domain

Opinion filed August 20, 2020

                                      In The

        Eleventh Court of Appeals
                                   __________

                                No. 11-18-00221-CV
                                    __________

          D. WEBB INDUSTRIES, LLC D/B/A EAST TEXAS
              OILFIELD SUPPLY COMPANY, Appellant
                                        V.
         PERMIAN EQUIPMENT RENTALS, LLC, Appellee

                 On Appeal from the County Court at Law No. 2
                            Midland County, Texas
                       Trial Court Cause No. CC18659

                      MEMORANDUM OPINION
      Permian Equipment Rentals, LLC sued D. Webb Industries, LLC d/b/a East
Texas Oilfield Supply Company (referred to in this opinion as “D. Webb Industries”)
to recover for goods and services that Permian claimed to have furnished to D. Webb
Industries. The lawsuit included claims based upon sworn account, breach of
contract, and “quantum meruit/unjust enrichment.” Permian also sought attorney’s
fees in connection with its claims.
      After Permian sued D. Webb Industries, D. Webb Industries filed a motion to
transfer venue and, subject to that motion, filed its original answer wherein it
generally denied the claims made by Permian. Also, the answer contained a verified
denial in which D. Webb Industries generally denied that it owed the amount claimed
by Permian. Ultimately, D. Webb Industries abandoned its motion to transfer venue,
and venue is not an issue in this appeal.
      Permian subsequently filed a traditional motion for summary judgment. After
Permian filed its motion for summary judgment, D. Webb Industries filed its
“Motion to Transfer Venue and First Amended Original Answer Subject to its
Motion to Transfer Venue.” D. Webb Industries also filed a response to Permian’s
motion for summary judgment.
      By order dated June 13, 2018, the trial court granted Permian’s motion for
summary judgment on Permian’s sworn account and quantum meruit causes of
action. In its order, the trial court awarded Permian $28,670 plus interest and costs.
It also awarded Permian attorney’s fees of $13,056.18 and provided that the
judgment was final.
       After the trial court had entered its judgment, D. Webb Industries filed a
“Motion for Reconsideration or, in the Alternative, to Modify Final Judgment.” For
the first time, D. Webb Industries asserted that attorney’s fees could not be awarded
against a limited liability company under Chapter 38 of the Texas Civil Practice and
Remedies Code. D. Webb Industries also argued that the determination of the
amount of attorney’s fees was a question of fact and that, because D. Webb
Industries had filed a jury demand, the issue as to the amount of attorney’s fees

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should be submitted to a jury. Additionally, D. Webb Industries argued that the
evidence was conflicting on the issue of the amount of attorney’s fees.
      Permian responded to D. Webb Industries’ motion to reconsider and asserted
that the issue as to the availability of attorney’s fees under Chapter 38 had either
been waived or tried by consent. Permian also maintained that it is proper, under
Chapter 38, to award attorney’s fees against a limited liability company and that the
amount of attorney’s fees is not always a question of fact. Permian also sought
additional attorney’s fees in connection with D. Webb Industries’ motion to
reconsider.
      After the trial court had heard D. Webb Industries’ motion to reconsider, it
issued another order in which it again granted Permian’s motion for summary
judgment, as it had before. However, in the new judgment, the trial court increased
the award of attorney’s fees and costs awarded against D. Webb Industries by
$7,083.67 for a total award of attorney’s fees and costs in the amount of $20,139.85.
This appeal followed the entry of the second judgment. We modify and affirm.
      In its first issue on appeal, D. Webb Industries asserts that it created a fact
issue when it provided competent summary judgment evidence that it did not owe
the account sued upon. Therefore, D. Webb Industries maintains, the trial court erred
when it granted summary judgment for Permian.
      We will first review the summary judgment as to the claim on sworn account.
      Permian’s motion for summary judgment was a traditional one. We review a
summary judgment de novo. Smith v. Deneve, 285 S.W.3d 904, 909 (Tex. App.—
Dallas 2009, no pet.). To prevail on a traditional motion for summary judgment, the
movant must prove that there is no genuine issue regarding any material fact and
that the movant is entitled to a judgment as a matter of law. TEX. R. CIV. P. 166a(c);
Little v. Tex. Dep’t of Criminal Justice, 148 S.W.3d 374, 381 (Tex. 2004). We are

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to take as true all evidence favorable to the nonmovant and indulge all reasonable
inferences in the nonmovant’s favor. Valance Operating Co. v. Dorsett, 164 S.W.3d
656, 661 (Tex. 2005). The summary judgment evidence raises a fact issue if
reasonable and fair-minded jurors could differ in their conclusions in light of all the
summary judgment evidence. Goodyear Tire & Rubber Co. v. Mayes, 236 S.W.3d
754, 755 (Tex. 2007). A matter is conclusively established if reasonable people
could not differ as to the conclusion to be drawn from the evidence. See City of
Keller v. Wilson, 168 S.W.3d 802, 816 (Tex. 2005).
      Rule 185 of the Texas Rules of Civil Procedure addresses suits on sworn
accounts. TEX. R. CIV. P. 185. The rule is not a substantive rule but, rather, is a
procedural vehicle by which a claimant may establish a prima facie right of recovery.
Panditi v. Apostle, 180 S.W.3d 924, 926 (Tex. App.—Dallas 2006, no pet.).
      The elements of a sworn account claim are: “(1) the sale and delivery of
merchandise or performance of services; (2) that the amount of the account is ‘just,’
i.e., the prices charged are pursuant to an express agreement, or in the absence of an
agreement, that the charges are usual, customary, or reasonable; and (3) that the
outstanding amount remains unpaid.” Ellis v. Reliant Energy Retail Servs., L.L.C.,
418 S.W.3d 235, 246 (Tex. App.—Houston [14th Dist.] 2013, no pet.). The account
must be one upon which a systematic record has been kept. TEX. R. CIV. P 185. The
claim must be “supported by the affidavit of the party, his agent or attorney . . . , to
the effect that such claim is, within the knowledge of affiant, just and true, that it is
due, and that all just and lawful offsets, payments and credits have been allowed.”
Id. If those provisions of Rule 185 are met, the claim is taken as true unless the
opposing party files, under oath, a written denial of the claim. Id. If the opposing
party fails to file a written denial under oath, then it is not allowed to deny the claim
or any item in it. Id.

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      Permian met the requirements of Rule 185. In its Second Amended Petition,
Permian alleged that it provided goods and services to D. Webb Industries; that D.
Webb Industries accepted them and became bound to pay the charges; that the
charges were reasonable and necessary; that the records of the transaction were
systematically kept in the regular course of business; that all just and lawful offsets,
payments, and credits had been allowed; that the claim was just and true; that it had
made demand upon D. Webb Industries; and that the balance was due. Permian
attached its records custodian’s affidavit in support of the claim. Copies of the
records were attached to the affidavit.
      However, a defendant may destroy the prima facie presumption if it files a
sworn denial of the plaintiff’s claim and if the sworn denial is supported by an
affidavit in which the defendant denies the account as required by Rule 93(10) of the
Texas Rules of Civil Procedure. TEX. R. CIV P. 93(10), 185; Woodhaven Partners,
Ltd. v. Shamoun & Norman, L.L.P., 422 S.W.3d 821, 833 (Tex. App.—Dallas 2014,
no pet.). If a defendant complies with that provision, the plaintiff must introduce
proof of its claim. Woodhaven Partners, 422 S.W.3d at 833. If a defendant does
not comply with that provision, it may not dispute either the receipt of the goods or
services or the correctness of the charges. See id.
      “[T]he purpose of a verified specific denial is to point out the manner in which
the plaintiff’s allegations within the petition are not true. Otherwise[,] neither the
court nor the opposing party is apprised of the fact issue that necessitates further
litigation.” Andrews v. E. Tex. Med. Ctr.–Athens, 885 S.W.2d 264, 267 (Tex.
App.—Tyler 1994, no pet.). “A sworn general denial does not constitute a denial of
the account and is insufficient to remove the evidentiary presumption created by a
properly worded and verified suit on an account.” Woodhaven Partners, 422 S.W.3d
at 833.

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      A defendant must do more than make a “broad generalization that he
‘specifically denies’ the sworn account allegations.” Id. The information in the
affidavit “must address the facts on which the defendant intends to rebut the
plaintiff’s affidavit.” Id.; see also Andrews, 885 S.W.2d at 268. A general statement
in the affidavit to the effect that the sworn account is “not true in whole or in part”
or that denies that the defendant is “indebted for the amount alleged” in the petition
is insufficient to rebut the evidentiary effect of a properly verified claim on a sworn
account. Woodhaven Partners, 422 S.W.3d at 832, 834; Andrews, 885 S.W.2d at
265, 268.
      In its First Amended Original Answer, D. Webb Industries stated that
“Defendant denies that it owes the amount claimed.” An examination of D. Webb
Industries’ pleadings, including affidavits, reveals that D. Webb Industries’ position
from the outset has been that it can find no documentation, such as signed field
tickets, in its own records, and Permian has not furnished any, to “allow [D. Webb
Industries] to determine which jobs these deliveries should be attributed to.” Dustin
L. Webb, the owner of D. Webb Industries, averred that he “was only able to confirm
that one of the invoices [was] valid.” Webb also swore that, in the absence of any
evidence in Permian’s file or D. Webb Industries’ files that D. Webb Industries
actually ordered the goods or services or signed the field tickets receiving the goods
or services, “there is only one logical conclusion -- that D. Webb Industries did not
order the good [sic] and/or services sought in the invoices.”
      Webb’s affidavit basically is to the effect that, because he can find nothing in
his company’s records to support Permian’s claim, it follows that D. Webb Industries
does not owe the account. “Therefore,” avers Webb, “[D. Webb Industries] disputes
the account sought by plaintiff in this case.” D. Webb Industries’ denial is explicitly
based upon what it calls a “logical conclusion”; there are no other facts contained in

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the affidavit other than it cannot find any paperwork to support Permian’s claim.
Based upon the absence of any records, D. Webb Industries concludes that it must
not owe the account. Although the affidavit might contain proof that D. Webb
Industries could find no records, it is only by conclusion that D. Webb Industries
denies the account.       Conclusory affidavits are insufficient to raise fact
issues. Ryland Grp., Inc. v. Hood, 924 S.W.2d 120, 122 (Tex. 1996).
      Webb’s affidavit is insufficient to rebut the evidentiary presumption created
by Permian’s properly worded and verified suit. Because it complied with Rule 185,
the account is taken as prima facie evidence of the claim, and Permian is entitled to
summary disposition without formally introducing the account as evidence of the
debt. Woodhaven Partners, 422 S.W.3d at 833; S. Mgmt. Servs., Inc. v. SM Energy
Co., 398 S.W.3d 350, 353–54 (Tex. App.—Houston [14th Dist.] 2013, no pet.).
Therefore, D. Webb Industries may not dispute either the receipt of the goods and
services or the correctness of the charges. See Woodhaven Partners, 422 S.W.3d at
833. It follows, then, that D. Webb Industries did not raise a genuine issue regarding
any material fact and that the trial court did not err when it granted Permian summary
judgment on the account. We overrule D. Webb Industries’ first issue on appeal.
      In its second issue on appeal, D. Webb Industries maintains that the trial court
erred when it awarded attorney’s fees against D. Webb Industries because it is a
limited liability company. It is D. Webb Industries’ position that attorney’s fees may
not be awarded under Chapter 38 of the Texas Civil Practice and Remedies Code
against a limited liability company. On appeal, Permian disagrees, and it also
contends that, in any event, D. Webb Industries has either waived the issue or tried
it by consent. We will first consider the propriety of the award of Chapter 38
attorney’s fees against a limited liability company.

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      In Texas, a litigant may recover attorney’s fees only when a contract or statute
specifically provides for the recovery of such fees. Epps v. Fowler, 351 S.W.3d 862,
865 (Tex. 2011). Whether attorney’s fees are available under a statute is a question
of law. Alta Mesa Holdings, L.P. v. Ives, 488 S.W.3d 438, 453 (Tex. App.—Houston
[14th Dist.] 2016, pet. denied).
      Chapter 38 of the Texas Civil Practice and Remedies Code addresses
attorney’s fees. Section 38.001 provides that “[a] person may recover reasonable
attorney’s fees from an individual or corporation, in addition to the amount of a valid
claim and costs, if the claim is for . . . (7) a sworn account.” TEX. CIV. PRAC. & REM.
CODE ANN. § 38.001(7) (West 2015). Because a limited liability company is not a
listed entity under Section 38.001, attorney’s fees may not be awarded under
Chapter 38 against a limited liability company.        James Constr. Grp., LLC v.
Westlake Chem. Corp., 594 S.W.3d 722, 757–58 (Tex. App.—Houston [14th Dist.]
2019, pet. filed); Phoneternet, LLC v. Drawbridge Design, No. 05-17-00890-CV,
2018 WL 3238001, at *3 (Tex. App.—Dallas July 3, 2018, no pet.) (mem. op.); TEC
Olmos, LLC v. ConocoPhillips Co., 555 S.W.3d 176, 188 (Tex. App.—Houston [1st
Dist.] 2018, pet. denied); First Cash, Ltd v. JQ-Parkdale, LLC, 538 S.W.3d 189, 200
(Tex. App.—Corpus Christi–Edinburg 2018, no pet.); 8305 Broadway, Inc. v. J&J
Martindale Ventures, LLC, No. 04-16-00447-CV, 2017 WL 2791322, at *5 (Tex.
App.—San Antonio June 28, 2017, no pet.) (mem. op.); CBIF Ltd. P’ship v. TGI
Friday’s, Inc., No. 05-15-00157-CV, 2017 WL 1455407, at *25 (Tex. App.—Dallas
April 21, 2017, pet. denied) (mem. op.); Alta Mesa Holdings, 488 S.W.3d 438 at
452. We see no reason to rehash the statutory construction principles expressed in
these cases by our sister courts, and we adopt the reasoning set forth in them. We
decline Permian’s invitation to hold contrary to what seems to be the unanimous
position of the Texas Courts of Appeals that have addressed the issue. We hold that

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attorney’s fees under Chapter 38 are not recoverable against D. Webb Industries,
LLC, a limited liability company.
      But did D. Webb Industries waive the issue or try the issue by consent as
Permian argues?
      Again, after the trial court entered its first order in which it granted summary
judgment to Permian, D. Webb Industries filed a motion for reconsideration. In that
motion, D. Webb Industries raised the issue, for the first time, that the trial court
could not award Chapter 38 attorney’s fees against D. Webb Industries because it
was a limited liability company. In its response to that motion, Permian argued,
among other things, that D. Webb Industries had raised the attorney’s fee issue
untimely and that, in any event, the issue had been tried by consent. Permian also
claimed that it was entitled to additional attorney’s fees because it had to respond to
D. Webb Industries’ motion to reconsider.
      This case comes to us in a somewhat unusual posture. The trial court did not
simply deny the motion to reconsider. Rather, for all intents and purposes, it reheard
the motion for summary judgment and entered a new summary judgment. In the
usual circumstance, when a trial court considers a motion for new trial after entry of
a summary judgment, the trial court is limited to a consideration of the matters
already before it. “When a motion for new trial is filed after the summary judgment
has been granted, the [trial] court may consider only the record as it existed prior to
granting the summary judgment.” Parchman v. United Liberty Life Ins. Co., 640
S.W.2d 694, 696 (Tex. App.—Houston [14th Dist.] 1982, writ ref. n.r.e.).
      In its second summary judgment, the trial court stated:
             CAME ON TO BE HEARD Plaintiff’s Motion for Summary
      Judgment on rehearing at the request of Defendant, and the Court
      considered the pleadings on file, the evidence, the additional attorney
      fee affidavit presented in open court and filed thereafter, as well as

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      Defendant’s objections to such affidavit and the arguments of counsel.
      The Court finds that the Plaintiff’s Motion for Summary Judgment is
      well taken and, in all things, should be Granted.
      Further, the trial court overruled “the Defendant’s objections presented at the
Summary Judgment Rehearing.” The trial court also “Ordered that the Defendant’s
request on Motion for New Trial on the issue of attorney fees is DENIED.”
      The trial court then granted the same relief to Permian as it had granted in the
original summary judgment. However, in the new summary judgment, the trial court
awarded additional attorney fees to Permian in accordance with an affidavit that
Permian filed during the rehearing. Permian alleged that the additional fees were
incurred in connection with the motion for rehearing.
      There can be only one final judgment in a case. Archer Daniels Midland
Co. v. Bohall, 114 S.W.3d 42, 45 (Tex. App.—Eastland 2003, no pet.). Therefore,
the later summary judgment is the judgment with which we are concerned in this
appeal.
      By the trial court’s own words, the second judgment was based upon “the
pleadings on file, the evidence, the additional attorney fee affidavit presented in open
court and filed thereafter, as well as Defendant’s objections to such affidavit and the
arguments of counsel.” The pleadings on file at the time that the last summary
judgment was entered included D. Webb Industries’ claim that the trial court could
not assess Chapter 38 attorney’s fees against D. Webb Industries. We hold that D.
Webb Industries did not waive its objection to the award of attorney’s fees.
      Even if we are wrong on the waiver issue, “[s]ummary judgments must stand
on their own merits, and the non-movant’s failure to answer or respond cannot
supply by default the summary judgment proof necessary to establish the movant’s
right.” City of Houston v. Clear Creek Basin Auth., 589 S.W.2d 671, 678 (Tex.

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1979); accord McConnell v. Southside Ind. Sch. Dist., 858 S.W.2d 337, 343 (Tex.
1993) (summary judgments must stand or fall on their own merits); Tello v. Bank
One, N.A., 218 S.W.3d 109, 118–19 (Tex. App.—Houston [14th Dist.] 2007, no
pet.). It was incumbent upon Permian, as movant, to establish its entitlement to
attorney’s fees; it did not. Because attorney’s fees may not be awarded against a
limited liability company under Chapter 38, Permian was not, as a matter of law,
entitled to attorney’s fees. We sustain D. Webb Industries’ second issue on appeal.
        Because we have sustained D. Webb Industries’ second issue on appeal, we
need not address its third and fourth issues on appeal.
        We modify the judgment of the trial court to delete the award of attorney’s
fees. As modified, we affirm the trial court’s judgment.

                                                           JIM R. WRIGHT
                                                           SENIOR CHIEF JUSTICE

August 20, 2020
Panel consists of: Bailey, C.J.,
Stretcher, J., and Wright, S.C.J.1

Willson, J., not participating.

        1
          Jim R. Wright, Senior Chief Justice (Retired), Court of Appeals, 11th District of Texas at Eastland,
sitting by assignment.

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