Pinole Valley Trucking Inc. v. Texas Development Company

Opinion issued April 16, 2009 In The Court of Appeals For The First District of Texas NO. 01-08-00599-CV PINOLE VALLEY TRUCKING, INC., Appellant V. THE TEXAS DEVELOPMENT COMPANY, AS LEASING AGENT FOR 529 #3, LTD., Appellee On Appeal from the 165th District Court Harris County, Texas Trial Court Cause No. 2007-06846 MEMORANDUM OPINION Appellee, The Texas Development Company, as Leasing Agent for 529 #3, Ltd. (“Texas Development”), sued appellant, Pinole Valley Trucking, Inc. (“PVT”), for damages and holdover rent relating to property leased by PVT from Texas Development. Counsel for PVT did not appear at trial. After hearing Texas Development’s evidence, the trial court rendered judgment for Texas Development. In two points of error, PVT contends that the trial court erred in rendering judgment for Texas Development and in allowing PVT’s motion for new trial to be overruled by operation of law. We affirm.Background PVT began leasing office and warehouse space from Texas Development in March of 2003. After several amendments by the parties, the lease terminated on December 31, 2006. Texas Development sued PVT for damages, holdover rent, and attorney’s fees on February 6, 2007, alleging that PVT had “failed to vacate the Premises” upon termination of the lease and caused “substantial damage” to the property. PVT answered with a general denial. After a protracted discovery dispute, the case was tried to the bench on April 1, 2008. Counsel for PVT did not appear at trial. Texas Development called Stephen Marmion, a leasing agent and property manager for the company, who summarized the property damage for which Texas Development sued PVT. Marmion testified that he had worked for Texas Development for 17 years and that his duties were to “manage and lease industrial buildings and collect the rent and prepare buildings ready [sic] for the next tenant.” Through Marmion, Texas Development introduced the lease, an unpaid water bill, and an itemized description—including photographs and repair costs—of the damage into evidence. Marmion then testified as follows: Q: All right. And did you personally see this building at the time Pinole Valley Trucking originally leased the building? A: Yes, I did. Q: Were any of those damages in place at that time? A: No. Q: And did you personally inspect the building after Pinole Valley Trucking left? A: Yes, I did. Q: And were these the damages to that building? A: Yes, they are. Q: Next, what is the—are you familiar with the standard hourly rate for repairs for the metal buildings such as the damages there to the metal building, the office, the parking lot and the other items that are reflected in those photographs and that summary? A: Yes, I am. Q: And what is the standard hourly rate for the employees that do that work in Harris County? A: Today it’s $50. At that time I believe it was $48. Marmion also testified that the lease permitted Texas Development to charge rent at twice the normal monthly rate for holdover tenancy and that PVT had triggered the holdover provision: Q: And does—and when did they surrender the premises? A: They never really completely cleaned up the premises. They surrendered it one month late. . . . Q: Does paragraph 5.03 of the lease provide that any event [sic] that the tenant remains in possession of the premises or doesn’t clean up the premises to the proper condition at the termination date of the lease that the tenant will be deemed to be occupying the premises as a tenant from month-to-month except that the monthly rent for each hold over rent or partial month shall be twice the full monthly rent? A: That’s correct. . . . Q: Did Pinole Valley Trucking have all their goods removed? Did they vacate the premises pursuant to the lease on December 31st? A: No, they did not. Q: Did they hold over to January or part of the month of January? A: Yes. Q: Could you tell the Court approximately how many days they held over? A: Approximately, three weeks but since a number of things weren’t done—damages weren’t repaired, there were truck tires there, there were dumpsters there, actually they were there beyond the month of January 31. On April 24, 2008, the trial court rendered judgment in favor of Texas Development. PVT filed a motion for new trial on May 27, 2008, arguing that its nonappearance was not intentional or the result of conscious indifference because PVT’s counsel “was unaware that the trial was being conducted on April 1, 2008.” Counsel for PVT admitted that he was aware that the case was on the March 31, 2008, two-week trial docket but argued that his nonappearance was excused because “the case was the 17th jury trial on the docket” and “[d]efense counsel was advised by the Court that the case may be reached the second week of the two week docket.” In an affidavit attached to the motion, he averred that he had “received no prior notice that the trial of this case was to take place on the morning of April 1, 2008.” In its response to PVT’s motion for new trial, Texas Development contested PVT’s counsel’s claim that he had not received prior notice, stating that, “[w]hen the court coordinator notified [counsel for Texas Development] to report for trial on April 1, 2008, the court coordinator told [counsel for Texas Development] that she had placed several calls to [counsel for PVT]; however, he had not returned her calls.” PVT’s motion for new trial was overruled by operation of law on July 8, 2008. Rendition of Judgment In its first point of error, PVT argues that the trial court erred by rendering judgment for Texas Development. Specifically, PVT argues that Texas Development failed to present competent evidence that the damage at issue occurred during the lease and that PVT held over. PVT further argues that the “amounts” sought by Texas Development “are not supported as reasonable charges in the Harris County, Texas area but are unnecessary and are unreasonably high.” Damages to Property and Holdover PVT contends that the evidence presented by Texas Development was not competent because there was no evidence that “the sole witness [Marmion] had personal knowledge” of the damage to the leasehold or of PVT’s holdover. Because PVT was not present at trial to make objections regarding the admissibility of Texas Development’s evidence and thus waived any such objections, we read PVT’s point of error as a challenge to the legal and factual sufficiency of the evidence supporting the trial court’s judgment. Standard of Review Unlike a no-answer default judgment, in which the defendant does not file an answer, a post-answer default judgment, in which the defendant answers but fails to appear for trial, “constitutes neither an abandonment of defendant’s answer nor an implied confession of any issues thus joined by the defendant’s answer.” Stoner v. Thompson, 578 S.W.2d 679, 682 (Tex. 1979). Hence, Texas Development was required to carry its burden of proof and “offer evidence and prove [its] case as in a judgment upon a trial.” Id. When a party without the burden of proof, such as PVT, challenges the legal sufficiency of the evidence, we consider all of the evidence in the light most favorable to the prevailing party, indulging every reasonable inference in that party’s favor. Associated Indem. Corp. v. CAT Contracting, Inc., 964 S.W.2d 276, 285-86 (Tex. 1998); Ned v. E.J. Turner & Co., 11 S.W.3d 407, 408 (Tex. App.—Houston [1st Dist.] 2000, pet. denied). If there is more than a scintilla of evidence to support the challenged finding, we must uphold it. Formosa Plastics Corp. USA v. Presidio Eng’rs & Contractors, Inc., 960 S.W.2d 41, 48 (Tex. 1998). When the evidence offered to prove a vital fact is so weak as to do no more than create a mere surmise or suspicion of its existence, the evidence is no more than a scintilla and, in legal effect, is no evidence. Ford Motor Co. v. Ridgway, 135 S.W.3d 598, 601 (Tex. 2004) (quoting Kindred v. Con/Chem, Inc., 650 S.W.2d 61, 63 (Tex. 1983)). However, if the evidence supplies some reasonable basis for differing conclusions by reasonable minds as to the existence of a vital fact, then there is legally sufficient evidence. King Ranch, Inc. v. Chapman, 118 S.W.3d 742, 751 (Tex. 2003). The traditional scope of review does not disregard contrary evidence if there is no favorable evidence, or if contrary evidence renders supporting evidence incompetent or conclusively establishes the opposite. City of Keller v. Wilson, 168 S.W.3d 802, 810-11 (Tex. 2005). Evidence can be disregarded whenever reasonable jurors could do so, an inquiry that is necessarily fact-specific. Id. When reviewing a factual sufficiency challenge, we examine, consider, and weigh all of the evidence, setting aside the verdict only if the evidence is so weak or the finding is so against the great weight and preponderance of the evidence that it is clearly wrong and unjust. Cain v. Bain, 709 S.W.2d 175, 176 (Tex. 1986); Otis Elevator Co. v. Joseph, 749 S.W.2d 920, 923 (Tex. App.—Houston [1st Dist.] 1988, no writ). Because the trier of fact is the sole judge of the credibility of the witnesses and the weight to be given their testimony, in conducting a factual sufficiency review, we may not substitute our opinion for that of the trier of fact merely because we might have reached a different fact conclusion. Herbert v. Herbert, 754 S.W.2d 141, 144 (Tex. 1988); Rego Co. v. Brannon, 682 S.W.2d 677, 680 (Tex. App.—Houston [1st Dist.] 1984, writ ref’d n.r.e.). The Evidence Marmion testified that he inspected the property both at the time PVT originally leased it and after PVT left and that the property damage occurred in the interim. Texas Development also introduced photographs of the damage and an itemized summary of the repair costs. Additionally, Marmion testified that PVT had triggered the holdover provision in the lease by not surrendering the premises on time, by not repairing the damage, and by leaving truck tires and dumpsters on the property. The lease, which was introduced into evidence, required PVT, on the last day of the lease term, to “peaceably surrender the Premises in good condition and repair consistent with Tenant’s duty to make repairs as herein provided” and “remove all of its property and trade fixtures and equipment from the Premises. . . .” The holdover provision permitted Texas Development to recover holdover rent as well as all costs “arising out of loss or liability resulting from delay by Tenant in so surrendering the Premises as provided in this Lease . . . .” We conclude that the evidence creates far more than a mere surmise or suspicion that PVT damaged the property during its tenancy and triggered the holdover provision. Accordingly, we hold that the evidence is legally sufficient to support the trial court’s findings in favor of Texas Development. See Ridgway, 135 S.W.3d at 601. Further, giving due deference to the trial court’s determination of Marmion’s credibility, we conclude that the evidence is not so weak as to render the trial court’s findings clearly wrong or unjust and accordingly hold that the evidence supporting those findings is factually sufficient. See Cain, 709 S.W.2d at 176; Herbert, 754 S.W.2d at 144. “Amounts” PVT also complains that the “amounts” sought by Texas Development “are not supported as reasonable charges in the Harris County, Texas area but are unnecessary and are unreasonably high.” Repair Costs Generally, proof of reasonableness and necessity of repairs is required to recover damages for repair costs. Ron Craft Chevrolet, Inc. v. Davis, 836 S.W.2d 672, 676 (Tex. App.—El Paso 1992, writ denied). The words “reasonable” and “necessary” need not be used to establish that repairs are recoverable. Id. at 677. A plaintiff must only present sufficient evidence to justify a fact finding that the repair costs were reasonable and the repairs made were necessary. Id. The Evidence Here, Texas Development introduced an exhaustive itemized summary of the damages into evidence. The summary contains a description and a repair cost figure, which is divided into material and labor components, for each item of damages and includes 86 photographs. Additionally, Marmion, who testified that he has held a commercial real estate license since 1971, discussed the damage and the repair costs and testified as to the standard hourly rate for such repairs in Harris County. We conclude that Texas Development introduced sufficient evidence to justify the trial court’s finding that the repair costs were reasonable and the repairs made were necessary. Id. Conclusion We hold that the evidence is legally and factually sufficient to support the trial court’s judgment and overrule appellant’s first point of error. Motion for New Trial In its second point of error, PVT contends that the trial court erred in allowing PVT’s motion for new trial to be overruled by operation of law. Standard of Review To set aside a post-answer default judgment, a party must show (1) its failure to appear at trial was not intentional or the result of conscious indifference, but was due to mistake or accident; (2) there exists a meritorious defense to the suit; and (3) granting the motion will not delay or otherwise work an injury to the other party. Craddock v. Sunshine Bus Lines, Inc., 134 Tex. 388, 133 S.W.2d 124, 126 (1939). A trial court abuses its discretion if it denies a motion for new trial when the defendant satisfies the Craddock standard. Old Republic Ins. Co. v. Scott, 873 S.W.2d 381, 382 (Tex. 1994). Conscious Indifference In an affidavit attached to his motion for new trial, counsel for PVT explained that he was aware that the case was on the March 31, 2008, two-week trial docket but “was advised by the Court that the case may be reached for trial the second week of the trial docket” and “received no prior notice that the trial of this case was to take place on the morning of April 1, 2008.” Texas Development contested the mistake/conscious indifference element of the Craddock test in its response. Failure to Request Hearing The record reflects no attempt by PVT to obtain a hearing on its motion for new trial. If a party contests the mistake/conscious indifference element of the Craddock test, an evidentiary hearing with live witnesses is ordinarily required. Puri v. Mansukhani, 973 S.W.2d 701, 715 (Tex. App.—Houston [14th Dist.] 1998, no pet.) (citing Estate of Pollack v. McMurrey, 858 S.W.2d 388, 392 (Tex. 1993)). In Puri, when deciding a case involving a no-answer default judgment, the Fourteenth Court of Appeals held that no abuse of discretion occurred “[b]ecause [the defaulting defendant] failed to request a hearing on the contested issue of conscious indifference and allowed the motion [for new trial] to be overruled by operation of law.” Puri, 973 S.W.2d at 715. In making the same holding in a post-answer default judgment case, the Fifth Court of Appeals explained: [W]hen a motion for new trial requires the exercise of discretion, the judge must have an opportunity to exercise his discretion before that discretion can be abused. An abuse of discretion may occur if the defendant, though diligent, is unable to obtain a hearing within the time allowed by the rules or if, after hearing the motion, the judge fails to rule on the motion within that time. However, we hold that where, as here, the record fails to show any attempt to obtain a timely hearing, no abuse of discretion is shown. Shamrock Roofing Supply, Inc. v. Mercantile National Bank, 703 S.W.2d 356, 358 (Tex. App.—Dallas 1985, no writ). We agree with the reasoning of Puri and Shamrock. Accordingly, we hold that the trial court did not abuse its discretion in allowing PVT’s motion for new trial to be overruled by operation of law and overrule PVT’s second point of error.Conclusion We affirm the judgment of the trial court. George C. Hanks, Jr. Justice Panel consists of Chief Justice Radack and Justices Alcala and Hanks.