Court Opinion

ID: 4507082
Source: CourtListenerOpinion
Date Created: 2020-02-13 11:12:01.668695+00
Date Added: 2024-06-11T15:45:31.261718
License: Public Domain

AFFIRMED and Opinion Filed February 11, 2020

                                         S   In The
                               Court of Appeals
                        Fifth District of Texas at Dallas
                                      No. 05-19-00188-CV

   LAW OFFICE OF ANDREW L. JONES, P.C., AND ANDREW JONES, Appellants
                                V.
                   LESLIE SCHACHAR, MD, Appellee

                      On Appeal from the 193rd Judicial District Court
                                   Dallas County, Texas
                           Trial Court Cause No. DC-17-11330

                             MEMORANDUM OPINION
                          Before Justices Molberg, Reichek, and Evans
                                  Opinion by Justice Reichek
        Appellants Law Office of Andrew L. Jones, P.C., and Andrew Jones appeal the trial

court’s take-nothing summary judgment on their claims to recover fees they contend are owed

under an oral flat-fee agreement for legal services with Leslie Schachar, MD. In two issues,

appellants argue they raised fact issues precluding summary judgment. For the reasons set out

below, we overrule both issues and affirm the trial court’s judgment.

                           FACTUAL AND PROCEDURAL BACKGROUND

       In July 2010, Schachar entered into a written contingency fee agreement with the law firm

of Tipton Jones to collect a judgment obtained by Schachar against his former business partner,

Stanley Thaw. Andrew Jones handled the case. The agreement automatically terminated in
eighteen months if not renewed in writing and provided that neither party would owe the other

anything.

         Weeks before the fee agreement terminated, Thaw filed for Chapter 7 bankruptcy.

Thereafter, in February 2012, Schachar entered into a new 50% contingency fee agreement with

Jones’s new firm, Andrew L. Jones, P.C., to collect the Thaw debt. This agreement terminated in

twenty-four months if not renewed in writing, and, as before, neither party would owe the other

anything. Additionally, the agreement provided as follows:

         This letter constitutes the entire agreement of the parties pertaining to the terms of
         our engagement as specified herein, and it supersedes all prior agreements,
         understandings, negotiations and discussions. This Agreement may not be
         modified except in writing and signed by all parties hereto.

          Christopher Moser, an attorney with the law firm of Quilling, Selander, Lownds, Winslett

& Moser, P.C., was appointed as the Chapter 7 trustee to administer the Thaw bankruptcy estate.1

One of the assets of the estate was a multi-million dollar residence in Plano, Texas. Jones filed a

proof of claim on Schachar’s behalf asserting he was a secured creditor of the property. Ultimately,

the bankruptcy court ordered the house to be sold for the benefit of the creditors.

         About this time, Jones took a position as “of counsel” with the law firm where the

bankruptcy trustee was employed. Because his representation of Schachar in the Thaw bankruptcy

represented a conflict of interest, on September 4, 2013, Jones withdrew as counsel for Schachar

in the bankruptcy proceeding. On the same day, Jones sent a one-page invoice to Schachar

requesting payment of $211,784.52 for “Total Current Work.” The bill was based on 50%

recovery on $433,569.03, minus $5,000 previously paid by Schachar. At that time, Jones had not

recovered $433,569.03 from the Thaw bankruptcy estate.

    1
     During the course of the bankruptcy proceedings, the bankruptcy court approved Moser’s request to employ Jones as special
counsel on a contingency fee basis to pursue certain fraudulent claims against various other parties.

                                                            –2–
            Seven days after Jones withdrew as counsel, the Chapter 7 trustee objected to Schachar’s

secured claim and sought to reclassify it as an unsecured claim, which likely meant Schachar would

receive little or no recovery from the bankruptcy estate.2 Schachar hired new counsel to defend

against the trustee’s objection. Litigation of the issue continued for more than two years, with

Schachar ultimately prevailing.3 The bankruptcy court approved a settlement of Schachar’s

secured claim and distribution to him of $444,000 from the proceeds of the Plano property.

            In August 2017, appellants sued Schachar for breach of contract, quantum meruit,

promissory estoppel, and unjust enrichment. They alleged they had an oral agreement, beginning

on September 4, 2013, to provide legal services and “continue to provide legal services” with

respect to the collection of the Thaw debt. Appellants alleged Schachar agreed to a “flat fee” of

$211,784.52 “to be paid upon the recovery of all or part of the debt” by Schachar, and that Schachar

had recovered more than $400,000 but refused to pay the fee.

            Schachar filed an answer generally denying the allegations, specifically denying that

conditions precedent to recovery were performed, and raising several rule 94 affirmative defenses.

Subsequently, Schachar sought both traditional and no-evidence summary judgment supported by

affidavit testimony, copies of the 2010 and 2012 written fee agreements, and documents from the

Thaw bankruptcy.

            With respect to the breach of contract claim, Schachar argued, among other grounds, that

the February 2012 Fee Agreement was required to be in writing because (1) it contained an express

two-year performance period and (2) was a contingency fee contract for legal services. See TEX.

BUS. & COM. CODE ANN. § 26.01(a), (b)(6) (requiring an agreement which is not to be performed

within one year from the date of making the agreement to be in writing and signed by the person

     2
        Two months later, Schachar filed a grievance against Jones, which Jones states was “summarily dismissed.” Jones asserted in his declaration
that he continued to “provide legal services” to Schachar until he received notice of the grievance on November 20, 2013.
     3
         Schachar’s legal fees were more than $130,000.

                                                                      –3–
to be charged); TEX. GOV’T CODE ANN. § 82.065(a) (requiring contingent fee contract for legal

services to be in writing and signed by attorney and client). Because the contract was required to

be in writing, he argued, the alleged subsequent “oral agreement” to terminate the written fee

agreement was an unenforceable oral modification. As to appellants’ equitable claims, Schachar

raised numerous grounds, including the argument that appellants could not recover on those claims

because there is a valid contract covering the services furnished.

       Appellants responded to the motion, supported by Jones’s declaration, asserting there is a

fact issue as to whether the February 2012 Fee Agreement was terminated and replaced by the

September 2013 oral agreement.        In his declaration, Jones asserted that he had numerous

communications with Schachar during the weeks and months preceding his withdrawal as counsel,

during which time Schachar “repeatedly expressed a strong desire for Jones to continue

representing him with respect to collecting the Thaw Judgment and acknowledged that Jones had

to withdraw as counsel in the bankruptcy proceeding.”           Jones averred that after lengthy

negotiations, the parties orally agreed to a new representation agreement on September 4, 2013.

In particular, he asserted, they agreed (1) to terminate the 2012 agreement and “the requirement

for written termination was waived,” (2) in consideration of Jones’s agreement to continue to

represent Schachar, Schachar would pay the Jones firm a flat fee of $211,784.52, (3) the flat fee

represented, among other things, “agreed-to compensation for [Jones’s] continued representation

of [Schachar] as collection counsel, not solely for past work,” and (4) as for time of payment, the

flat fee would be “due and payable upon recovery of the underlying claim.” Appellants also

asserted that summary judgment was inappropriate on the equitable claims.

       The trial court granted Schachar’s motion without stating grounds. Appellants’ motion for

new trial was overruled by operation of law, and this appeal ensued.

                                                –4–
                                               ANALYSIS

         We review an order granting summary judgment de novo. Merriman v. XTO Energy, Inc.,

407 S.W.3d 244, 248 (Tex. 2013).

         When reviewing a traditional summary judgment in favor of a defendant, we determine

whether the defendant conclusively disproved an element of the plaintiff’s claim or conclusively

proved every element of an affirmative defense. Durham v. Children’s Med. Ctr. of Dallas, 488
S.W.3d 485, 489 (Tex. App.—Dallas 2016, pet. denied). A matter is conclusively established if

ordinary minds could not differ as to the conclusion to be drawn from the evidence. Id. We take

as true all evidence favorable to the nonmovant and indulge every reasonable inference and resolve

any doubts in the nonmovant’s favor. Exxon Mobil Corp. v. Rincones, 520 S.W.3d 572, 579 (Tex.

2017).

         In a no-evidence motion for summary judgment, the movant need only allege there is no

evidence to support an essential element of a claim on which a nonmovant has the burden of proof

at trial. See TEX. R. CIV. P. 166a(i); Sw. Elec. Power v. Grant, 73 S.W.3d 211, 215 (Tex. 2002).

Once that occurs, the burden shifts to the nonmovant to present evidence that raises a fact issue on

the challenged elements. TEX. R. CIV. P. 166a(i); Swan v. GR Fabrication, LLC, No. 05-17-00827-

CV, 2018 WL 1959486, at *1 (Tex. App.—Dallas Apr. 26, 2018, no pet.) (mem. op.). The

nonmovant will defeat a no-evidence summary judgment by presenting more than a scintilla of

evidence to raise a genuine issue of material fact. Swan, 2018 WL 1959486, at *1. More than a

scintilla of evidence exists if the evidence rises to a level that would enable reasonable and fair-

minded people to differ in their conclusions. Ford Motor Co. v. Ridgway, 135 S.W.3d 598, 601

(Tex. 2004).

         In their first issue, appellants assert a fact issue exists as to whether there is an enforceable

oral agreement between Jones and Schachar, directing us to Jones’s testimony that (1) he orally

                                                   –5–
agreed to a new representation agreement on September 4, 2013, (2) the February 2012 Fee

Agreement was “terminated” by the parties, and (3) the contractual requirement for written

modification was waived. As legal authority, appellants contend that (1) Texas law does not

prevent a written instrument to be later modified or changed by the parties by an oral agreement

and (2) a written contract––not required by law to be in writing––may be modified by a subsequent

oral agreement even though it provides that it can be modified only by written agreement.” See

Mar-Lan Indus., Inc. v. Nelson, 635 S.W.2d 853, 855 (Tex. App.—El Paso 1982, no writ).

           We agree that, generally, a written contract not required by law to be in writing may be

modified by a subsequent oral agreement even though it provides it can be modified only by a

written agreement. See Roehrs v. FSI Holdings, Inc., 246 S.W.3d 796, 808 (Tex. App.—Dallas

2008, pet. denied); Pointe W. Ctr., LLC v. It’s Alive, Inc., 476 S.W.3d 141, 151 (Tex. App.—

Houston [1st Dist.] 2015, pet. denied). “Such a written bargain or agreement is of no higher legal

degree than an oral one, and either may vary or discharge the other.” Pointe W. Ctr., 476 S.W.3d

at 151 (quoting Mar-Lan Indus., 635 S.W.2d at 855). Thus, proof that a contract provision requires

modifications to be in writing does not establish as a matter of law that the parties did not modify

the contract orally. Pointe W. Ctr., 476 S.W.3d at 151.

           But, when the written contract is required by law to be in writing, the rules are different.

A contract that is required to be in writing may not be rescinded by oral agreement. Givens v.

Dougherty, 671 S.W.2d 877, 878 (Tex. 1984).4 Moreover, a contract required to be in writing

cannot be orally modified except in limited circumstances, such as extension of time for

performance. Id. The critical determination is whether the modification materially affects the

     4
       In reaching this conclusion in Daugherty, the supreme court acknowledged that the “trend of modern authority” followed the contrary view.
Nevertheless, the court considered the purpose of the statute of fraud to “remove uncertainty, prevent fraudulent claims, and reduce litigation,” and
reasoned that “[t]o allow parol agreements to rescind contracts required to be in writing would permit all of these effects.” Id. at 878.

                                                                       –6–
obligations in the underlying agreements. Grp. Hosp. Servs., Inc. v. One and Two Brookriver Ctr.,

704 S.W.2d 886, 890 (Tex. App.—Dallas 1986, no writ); Am. Garment Props., Inc. v. CB Richard

Ellis-El Paso, L.L.C., 155 S.W.3d 431, 437 (Tex. App.—El Paso 2004, no pet.).                                               Oral

modifications are enforceable only if the character or value of the underlying agreement is

unaltered. Grp. Hosp. Servs., 704 S.W.2d at 890; Am. Garment Props., 155 S.W.3d at 437.

         Here, although appellants suggest the February 2012 Fee Agreement was not required by

law to be in writing, they offer no legal citation or analysis for such a proposition. Regardless, it

is undisputed that the February 2012 Fee Agreement was required by law to be in writing because

it was a contingent fee contract for legal services. See TEX. GOV’T CODE ANN. § 82.065(a).5 This

statute, which mandates such agreements to be in writing, “can be sensibly construed to operate in

a manner similar to the statute of frauds.” Enochs v. Brown, 872 S.W.2d 312, 318 (Tex. App.—

Austin 1994, no writ), disapproved on other grounds by Roberts v. Williamson, 11 S.W.3d 113

(Tex. 2000).

         Because the 2012 agreement was required to be in writing, the dispositive question is

whether the oral modification materially affected the obligations in the underlying agreements.

Changing the 2012 Fee Agreement from a percentage contingency fee to a flat fee payable upon

recovery is clearly a material change, and appellants have not argued otherwise. The February

2012 Fee Agreement involved collecting the Thaw judgment. Under the written agreement,

Schachar agreed that in consideration for services rendered by Andrew L. Jones P.C., the firm

would receive 50% of any and all amount recovered and irrevocably assigned to the firm the

contingent fee. Further, the parties agreed that the agreement would terminate in twenty-four

     5
       Because the contract was required to be in writing under the government code, we need not address whether it was also
required to be in writing under the Statute of Frauds, which is codified in section 26.01 of the Texas Business and Commerce Code.
Schachar argued the contract fell within section 26.01(b)(6), which required any agreement which cannot be performed within one
year from its date to be in writing and signed by the party obligated to perform, because of the provision that the contract
automatically terminated in twenty-four months if not renewed in writing.

                                                              –7–
months if not renewed in writing (which would have been February 2014) and neither the firm nor

Schachar would “owe the other party anything.” In contrast, under appellants’ alleged oral

modification, appellants contend Schachar owed a “flat fee” of $211,784.52 “due and payable

upon recovery of the underlying claim.” This amount was not tied to any amount recovered but

was apparently contingent on recovery. By the time Schachar recovered any monies, which were

the result of the efforts of other counsel hired after Jones withdrew as counsel in the bankruptcy

proceeding, Schachar owed nothing under the written representation agreement per its express

terms. Because the oral modification asserted in this case would materially alter the parties’

written agreement, appellants’ summary judgment evidence did not raise a genuine issue of

material fact that precluded summary judgment in Schachar’s favor on appellants’ breach of

contract claim.6

           In reaching our conclusion, we expressly do not address the question of whether the

subsequent oral agreement itself was required to be in writing as a contingency fee agreement.

Although appellants assert that the “flat fee” required under the oral agreement would be “due and

payable upon recovery of the underlying claim,” they further assert this is a “payable-on-recovery

term” and not a “condition upon which the fee payment would be payable in the first place.”

Schachar did not bring any ground for summary judgment to defeat the breach of contract claim

on the basis that the oral agreement was likewise subject to section 82.065 of the government code;

consequently, we do not address this issue. For the reasons stated above, we overrule appellants’

first issue. Given this disposition, we need not address any other issues related to the breach of

contract claim.

           In their second issue, appellants assert summary judgment on their equitable claims was

inappropriate. Below, as one of his grounds for summary judgment, Schachar asserted that

   6
       To the extent appellants are suggesting they orally terminated the contract, rather than modified it, Daugherty precluded any such action.

                                                                      –8–
appellants’ claims for quantum meruit, promissory estoppel, and unjust enrichment were precluded

by the express contract doctrine.

       Under the express contract doctrine, a party generally cannot recover under an equitable

theory when there is a valid contract covering the services or materials furnished. See Hill v.

Shamoun & Norman, LLP, 544 S.W.3d 724, 738 (Tex. 2018) (quantum meruit); Trevino & Assocs.

Mech., L.P. v Frost Nat’l Bank, 400 S.W.3d 139, 146 (Tex. App.—Dallas 2013, no pet.); Fortune

Prod. Co. v. Conoco, Inc. 52 S.W.3d 671, 684 (Tex. 2000).

       In his summary judgment, Schachar asserted that both the written fee agreements in 2010

and 2012 covered the same subject matter as that of the legal services which were the subject of

appellants’ equitable claims, namely the recovery of the Thaw judgment. As evidence, he attached

both written agreements, both of which identify the scope as collecting on the Thaw judgment. On

appeal, appellants assert that Schachar’s reliance on the “express contract” doctrine is unavailing

because Schachar failed to conclusively prove that a valid, express contract covered the subject

matter of the parties’ dispute. Without any further explanation, analysis, or citation to the record,

appellants merely contend there was a fact issue “as to what extent the services were governed by

a valid, existing contract.” Given appellants’ failure to provide any substantive briefing of this

issue, we conclude it is waived. See TEX. R. APP. P. 38.1(h); PopCap Games, Inc. v. MumboJumbo,

LLC, 350 S.W.3d 699, 722 (Tex. App.—Dallas 2011, pet. denied) (explaining that failure to

provide substantive analysis waives issue on appeal).

       Moreover, there is an additional basis upon which to affirm summary judgment in

Schachar’s favor on appellants’ claims for promissory estoppel and unjust enrichment. In his

motion, Schachar also asserted there was no evidence of particular elements of each of these

claims, and appellants have not challenged those grounds on appeal.

                                                –9–
       Specifically, with respect to promissory estoppel, Schachar asserted there was no evidence

that either appellant reasonably and substantially relied on Schachar’s alleged oral agreement to

pay them a flat fee to their detriment given that (1) appellants withdrew the same day from

representing Schachar in the Thaw bankruptcy proceeding and (2) it was legally impossible for

them to collect the Thaw judgment outside the Thaw bankruptcy proceeding. See Trevino &

Assocs. Mech., L.P. v. Frost Nat’l Bank, 400 S.W.3d 139, 146 (Tex. App.—Dallas 2013, no pet.)

(elements of promissory estoppel claim are (1) a promise, (2) foreseeability of reliance thereon by

promisor, and (3) substantial detrimental reliance by promise). Id. With respect to unjust

enrichment, Schachar asserted there was no evidence that he obtained a benefit from appellants by

fraud, duress, or taking of an undue advantage. See Tex. Integrated Conveyor Sys., Inc. v.

Innovative Conveyor Concepts, Inc., 300 S.W.3d 348, 367 (Tex. App.—Dallas 2009, pet. denied)

(unjust enrichment occurs when person sought to be charged has wrongfully secured or passively

received benefit from another that would be unconscionable to retain, and person obtained benefit

from the other by fraud, duress, or the taking of an undue advantage).

       When a party moves for summary judgment on multiple grounds and the trial court’s order

granting summary judgment does not specify the ground or grounds on which it was based, the

appellant must negate all possible grounds upon which the order could have been based. Jarvis v.

Rocanville Corp., 298 S.W.3d 305, 313 (Tex. App.—Dallas 2009, pet. denied). The appellant can

do this by either asserting a separate issue challenging each possible ground, or asserting a general

issue that the trial court erred in granting summary judgment and within that issue providing

argument negating all possible grounds upon which summary judgment could have been granted.

Id. If an appellant does not challenge each possible ground for summary judgment, we must affirm

the summary judgment on the unchallenged grounds. See id.

                                               –10–
       Because appellants have not challenged every ground upon which summary judgment

could be based with respect to their claims for promissory estoppel and unjust enrichment, we are

required to affirm summary judgment on these claims regardless of the merits of the unchallenged

grounds. See Royale v. Knightbest Mgmt., LLC, No. 05-18-00908-CV, 2019 WL 4126600, at *11,

(Tex. App.—Dallas Aug. 30, 2019, no pet.) (mem. op.); see also Malooly Bros., Inc. v. Napier,

461 S.W.2d 119, 121 (Tex. 1970).    We overrule the second issue.

       We affirm the trial court’s judgment.

                                                 /Amanda L. Reichek/
                                                 AMANDA L. REICHEK
                                                 JUSTICE

190188F.P05

                                               –11–
                                         S
                               Court of Appeals
                        Fifth District of Texas at Dallas
                                       JUDGMENT

 LAW OFFICE OF ANDREW L. JONES,                      On Appeal from the 193rd Judicial District
 P.C., AND ANDREW JONES, Appellants                  Court, Dallas County, Texas
                                                     Trial Court Cause No. DC-17-11330.
 No. 05-19-00188-CV          V.                      Opinion delivered by Justice Reichek;
                                                     Justices Molberg and Evans participating.
 LESLIE SCHACHAR, MD, Appellee

     In accordance with this Court’s opinion of this date, the judgment of the trial court is
AFFIRMED.

       It is ORDERED that appellee LESLIE SCHACHAR, MD recover his costs of this
appeal from appellants LAW OFFICE OF ANDREW L. JONES, P.C., AND ANDREW JONES.

Judgment entered February 11, 2020

                                              –12–