Opinion
No. 05-07-00284-CV
Opinion issued February 29, 2008.
On Appeal from the County Court at Law No. 1 Dallas County, Texas, Trial Court Cause No. CC-04-03098-A.
Before Justices WHITTINGTON, RICHTER, and MAZZANT.
MEMORANDUM OPINION
After a bench trial, the trial judge entered judgment for Glen Atteberry in his suit against Craig Gene Dyer on a promissory note. Dyer appeals, alleging the trial judge erred in entering judgment because Atteberry failed to prove the existence of a partnership, the promissory note was usurious, and Dyer was entitled to attorney's fees. Dyer also contends the trial judge erred in failing to issue findings of fact and conclusions of law after Dyer requested them. We affirm the trial court's judgment. Because all dispositive issues are clearly settled in law, we issue this memorandum opinion. See Tex. R. App. P. 47.4.
Background
In a promissory note dated February 11, 2002, Dyer promised to pay Atteberry the principal amount of $11,000 in equal monthly payments of $400, to begin on February 15, 2002. The note provided the "annual interest rate" was zero. The note also included the following provision: "Interest on the debt evidenced by this note will not exceed the maximum rate or amount of nonusurious interest that may be contracted for, taken, reserved, charged, or received under law." It is not disputed Dyer made no payments on the note after September, 2002. Atteberry brought this suit for the balance due on the note, which he alleged to be $9,600.
In his answer, Dyer admitted signing the note but alleged Atteberry loaned him only $7,000, of which he had repaid more than $4,000 at the time the note was signed. Dyer raised numerous affirmative defenses, including lack of consideration. He also asserted counterclaims for usury and attorney's fees. In his counterclaims, Dyer alleged that because he owed Atteberry only approximately $3000, the note setting out payments of $400 per month on principal of $11,000 constituted an interest rate of over 90 percent per year.
At trial, Dyer did not testify. Atteberry testified and was cross-examined regarding the circumstances surrounding the making of the note. The trial judge entered judgment for Atteberry.
Standard of Review
Our record contains a reporter's record from the bench trial of this cause, but not findings of fact and conclusions of law. We hold the trial judge's failure to file findings and conclusions upon Dyer's request was harmless error. See Sheldon Pollack Corp. v. Pioneer Concrete of Tex., Inc., 765 S.W.2d 843, 845 (Tex.App.-Dallas 1989, writ denied) (where record before appellate court affirmatively shows complaining party suffered no injury, trial court's failure to file findings of fact or conclusions of law does not require reversal of judgment). Where the trial court does not file findings of fact or conclusions of law, fact findings necessary to support the trial court's judgment and supported by the evidence are implied. Cadle Co. v. Parks, 228 S.W.3d 915, 916 (Tex.App.-Dallas 2007, no pet.). When the appellate record includes a reporter's record, however, these implied findings are not conclusive and may be challenged for legal and factual sufficiency under the same standards that apply to jury and trial court findings. Roberson v. Robinson, 768 S.W.2d 280, 281 (Tex. 1989) (per curiam). The judgment must be affirmed if it can be upheld on any legal theory that finds support in the evidence. Cadle Co., 228 S.W.3d at 916. It is not necessary for the trial court to articulate the correct legal reason for its judgment. Cadle Co., 228 S.W.3d at 916.
Discussion
We first address Dyer's fourth issue, alleging the trial judge committed reversible error by failing to issue findings of fact and conclusions of law upon proper request. The judgment was signed on December 20, 2006, by Judge Russell Roden, the trial judge who heard the evidence at trial. Dyer filed his request for findings and conclusions on January 8, 2007, and a notice of past due findings and conclusions on February 7, 2007. Although Judge Roden heard the trial proceedings, by the time Dyer filed his request for findings, Judge D'Metria Benson had become the judge of the court. Atteberry argues that Dyer invited error in the cover letter accompanying his request, because in the letter, Dyer requested that Judge Benson not enter findings. In the alternative, Atteberry has requested in this court that the cause be abated to permit Judge Roden to file findings and conclusions.
A trial court's failure to respond to a timely request for findings of fact and conclusions of law is error and is presumed harmful unless the record before the appellate court affirmatively shows that the complaining party has suffered no harm. Willms v. Am. Tire Co., Inc., 190 S.W.3d 796, 801 (Tex.App.-Dallas 2006, pet. denied). The general rule is that an appellant has been harmed if, under the circumstances of the case, he has to guess at the reason the trial court ruled against him. Willms, 190 S.W.3d at 801-02. If there is only a single ground of recovery or a single defense, an appellant does not usually have to guess at the reasons for the trial court's ruling. Willms, 190 S.W.3d at 802. Here, Atteberry brought suit on a promissory note, and Dyer defended on the ground of lack of consideration. Because there was only a single ground of recovery, Dyer did not have to guess at the reason for the trial judge's ruling. The record, therefore, affirmatively shows Dyer suffered no harm from the trial court's failure to respond to his request for findings of fact and conclusions of law. See Willms, 190 S.W.3d at 801; Sheldon Pollack Corp., 765 S.W.2d at 845. We overrule Dyer's fourth issue.
We next address Dyer's first issue, urging that Atteberry failed to prove the existence of a partnership. Dyer argues that unless Atteberry proved a partnership, there was no evidence of consideration for the note, because Atteberry claims the consideration for the note was Atteberry's interest in a partnership. At trial, Atteberry testified to the following facts: in 1999 he and Dyer discussed Dyer's desire "to move into his own business," and they agreed Atteberry "would front some money to enable him to do that." They also agreed Atteberry was to receive a percent of the net income from the business. Atteberry invested $7500 in Dyer's business, but did not receive any income from it. When he complained to Dyer about not receiving any income, Dyer offered Atteberry $15,000, or double the amount invested, to buy out his interest in the business. Dyer then paid Atteberry approximately $4,000, and the promissory note was signed for the remaining $11,000. Dyer repaid some of the note but then ceased making payments.
Dyer bore the burden of proving his affirmative defense of lack of consideration. See Doncaster v. Hernaiz, 161 S.W.3d 594, 603 (Tex.App.-San Antonio 2005, no pet.) (existence of written contract presumes consideration for its execution; therefore party alleging lack of consideration has burden of proof to rebut presumption). As explained by the Texas Supreme Court in Roark v. Stallworth Oil and Gas, Inc., 813 S.W.2d 492, 496 (Tex. 1991) (citations omitted):
Consideration is a present exchange bargained for in return for a promise. It consists of either a benefit to the promisor or a detriment to the promisee. The detriment must induce the making of the promise, and the promise must induce the incurring of the detriment.
The court also noted a promise in payment for past services may not legally constitute present consideration. Roark, 813 S.W.2d at 496.
Dyer contends without a complete partnership agreement under which the parties were to share losses and a mutual right of control as well as profits, there was nothing for Dyer to buy from Atteberry for $11,000. In his reply brief Dyer also contends, apparently in the alternative, that there was consideration for the note, but it was only partial, and it was different from the consideration claimed by Atteberry. Dyer states he "has never argued that there was a complete failure of consideration," and cites Huff v. Speer, 554 S.W.2d 259, 263 (Tex.Civ.App.-Houston [1st Dist.] 1977, writ ref'd n.r.e.), for the proposition that "a partial failure of consideration is a defense pro tanto thereto." He admits "Atteberry was entitled to recover his $7,500," and contends "Dyer showed that the consideration Atteberry gave for the note was the $7,500 he advanced to Dyer," not the promise to buy out Atteberry's interest in Dyer's business. Dyer did not present any evidence at trial on these points, however, and relies on Atteberry's testimony to support the lack of consideration defense.
The trial judge could have found there was consideration for the promissory note from the evidence presented at trial. Whether or not there was a formal partnership agreement between Dyer and Atteberry, there was evidence Atteberry invested in Dyer's business and Dyer agreed both to pay Atteberry a share in the profits and, later, to buy Atteberry's share of the business. The trial judge also could have concluded that Dyer failed to establish his affirmative defense of lack of consideration as a matter of law. Considering all of the evidence, the trial judge's implied findings were not so against the great weight and preponderance of the evidence as to be clearly wrong and unjust. See Dallas County Constable Precinct No. 5 v. Garden City Boxing Club, Inc., 219 S.W.3d 613, 616 (Tex.App.-Dallas 2007, no pet.) (setting out standard of review of legal and factual sufficiency of evidence to support trial judge's findings and conclusions). We overrule Dyer's first issue.
In his second and third issues, Dyer argues the promissory note was usurious, and therefore, he is entitled to damages and attorney's fees. Dyer bore the burden of proving his counterclaims. See, e.g., Hartis v. Century Furniture Indus., Inc., 230 S.W.3d 723, 730 (Tex.App.-Houston [14th Dist.] 2007, no pet.) (defendant bears burden of proof on his own claims). Dyer's usury argument is premised on his contention he owed Atteberry only $3,000. However, there was evidence from which the trial judge could have concluded Dyer owed Atteberry $11,000 at the time the note was signed, and $9,600 at the time suit was filed. Moreover, the note reflects an annual interest rate of zero, and provides, "Interest on the debt evidenced by this note will not exceed the maximum rate or amount of nonusurious interest that may be contracted for, taken, reserved, charged, or received under law." While the mere presence of a usury savings clause will not rescue a transaction that is necessarily usurious by its explicit terms, see Armstrong v. Steppes Apartments, Ltd., 57 S.W.3d 37, 46 (Tex.App.-Fort Worth 2001, pet. denied), in appropriate circumstances, savings clauses may be construed to defeat an interpretation of a contract that would violate usury laws. See Lairsen v. Slutzky, 80 S.W.3d 121, 127 (Tex.App.-Austin 2002, pet. denied). Dyer failed to establish his usury claim. Further, because Dyer's counterclaim for attorney's fees was dependent upon his claim for usury, we find no error in the failure to award attorney's fees. See Tex. Fin. Code Ann. § 305.005 (Vernon 2006) (creditor liable under sections 305.001 or 305.003 for charging or receiving interest greater than amount allowed by law also liable for reasonable attorney's fees). We overrule Dyer's second and third issues.
We affirm the trial court's judgment.