Opinion
No. 05-10-01530-CV
06-08-2012
HENRY N. KASPAR AND J.R.K., INC., Appellants v. PATRIOT BANK, Appellee
AFFIRM; Opinion Filed June 8, 2012.
On Appeal from the 298th Judicial District Court
Dallas County, Texas
Trial Court Cause No. DC-09-05714
MEMORANDUM OPINION
Before Justices O'Neill, Richter, and Lang-Miers
Opinion By Justice O'Neill
The trial court granted summary judgment in favor of Patriot Bank (the Bank) regarding a guaranty executed by appellant Henry N. Kaspar (Kaspar) in favor of Danpar. Kaspar argues the trial court erred by granting summary judgment because a genuine issue of material fact exists. J.R.K., Inc. contends the trial court erred by entering an agreed judgment between it and the Bank. We affirm the trial court's judgments.
Background
The Bank and Danpar, a limited liability company, entered into a construction loan agreement in which the Bank agreed to make a loan to Danpar for the acquisition and development of certain property in Collin County. The loan was evidenced by a note executed by Danpar on May 31, 2006, and after several modification, renewal, and extension agreements the first note matured on August 30, 2008.
On or about May 31, 2006, Kaspar executed an unconditional guaranty, for the benefit of Danpar, as security for payment on the first note. He unconditionally guaranteed and promised to pay the Bank any and all indebtedness that Danpar owed the Bank.
The Bank later made a second loan to Danpar, and on August 9, 2006, Kaspar signed a second unconditional guaranty in which he agreed to pay any and all indebtedness that Danpar owed the Bank. The second note matured on August 9, 2008.
As additional security for repayment of the guarantees, Kaspar also executed three deeds of trusts covering certain real property to William D. Ellis, as trustee for the benefit of the Bank.
The loans matured according to their terms in August 2008. Danpar failed to make the required payments under the notes. The Bank notified Kaspar of Danpar's failure to pay; however, Kaspar failed to pay under the guaranties.
The Bank then foreclosed on the properties described in the deeds of trusts, sold them, and applied the money from the sales towards the balance owed on the notes. The properties sold for (1) $716,000.00; (2) $300,000.00; and (3) $170,000.00.
Following the foreclosures, the Bank learned several liens, which were in favor of J.R.K., Inc., encumbered the property described in the second deed. The Bank sent formal demand to Kaspar to remove the liens; however, he failed to take action to remove them.
Joanna Kaspar, appellant's wife, is the registered agent for J.R.K., Inc.
The Bank filed an original petition on May 7, 2009 against Danpar, Kaspar, and J.R.K., Inc. alleging that Danpar defaulted on its loans, and after foreclosure on the three deeds of trusts, a balance remained on the notes totaling $137,608.46. Further, the Bank argued Kaspar failed to honor his obligations under the guaranties.
The Bank filed a traditional motion for partial summary judgment on February 24, 2010 arguing it established a breach of the guaranties and was entitled to judgment as a matter of law. The trial court agreed and granted the motion on June 1, 2010 and awarded damages against Kaspar in the amount of $137,608.46, plus $33,624.12 in attorneys' fees, and costs.
On June 1, 2010, the Bank filed a motion for default judgment against J.R.K., Inc. after its original answer was stricken by the trial court. The Bank and J.R.K., Inc. entered into an agreed judgment on September 24, 2010 in which the parties agreed the "Lien is equitably subordinated to Plaintiff's claim and interest in the property." It further provided the lien was removed as a result of the Bank's foreclosure on the property.
Final judgment was entered as to Kaspar and Danpar on September 30, 2010. This appeal followed. Partial Summary Judgment
In his first issue, Kaspar argues the trial court erred by granting the Bank's motion for summary judgment because a genuine issue of material fact exists regarding whether Kaspar received consideration for executing the note in favor of Danpar. The Bank responds it provided evidence of the guarantee, signed by Kaspar, and Kaspar failed to provide any controverting evidence or object to its summary judgment evidence; therefore, no material fact issue exists. We agree with the Bank.
We review summary judgments under well-established standards. See Tex. R. Civ. P. 166a; Beesley v. Hydrocarbon Separation, Inc., 358 S.W.3d 415, 418 (Tex. App.-Dallas 2012, no pet.); see also Nixon v. Mr. Prop. Mgmt. Co., 690 S.W.2d 546, 548-49 (Tex. 1985). The movant has the burden of showing that no genuine issue of material fact exists and that it is entitled to judgment as a matter of law. Beesley, 358 S.W.3d at 418. A matter is conclusively established if ordinary minds cannot differ as to the conclusion to be drawn from the evidence. Id. In deciding whether a disputed material fact issue exists precluding summary judgment, evidence favorable to the non-movant will be taken as true. Id. We review a summary judgment de novo. Id.
To collect on a promissory note as a matter of law, the holder or payee need only establish that (1) there is a note; (2) he is the legal owner and holder of the note; (3) the defendant is the maker of the note; and (4) a certain balance is due and owing on the note. Blankenship v. Robins, 899 S.W.2d 236, 238 (Tex. App.-Houston [14th Dist.] 1994, no writ). When summary judgment proof establishes the above facts, the holder of the note is entitled to recover, unless the maker establishes a defense. Id.
First, Kaspar does not contest that the note exists, that the Bank was the legal holder of the note, and that Danpar was the maker of the note. Second, the Bank attached the affidavit of Tony Barnard to its motion for partial summary judgment. Barnard is the executive vice president of the Bank, and his duties include the collection of money due to the Bank pursuant to terms of various promissory notes and personal guaranties. He was one of the officers responsible for the Bank's business relationship with Danpar and Kaspar. Barnard also testified in his affidavit that despite demand from the Bank, Danpar refused to pay on the loan and a balance of $137,608.46 remains. Kaspar filed no objections to Barnard's affidavit. Thus, the Bank conclusively proved as a matter of law that it was entitled to collect on the promissory note because a note exists, Danpar is the maker, the Bank is the holder, and a balance is due and owing
Because Kaspar unconditionally guarantied the note, he was primarily liable for all amounts owed after Danpar defaulted on the note and failed to pay. See Ford v. Darwin, 767 S.W.2d 851, 854 (Tex. App.-Dallas 1989, writ denied) (stating a guaranty payment is an obligation to pay the debt when due if the debtor does not). To recover under the guaranty, the Bank needed to establish proof of (1) the existence and ownership of the guaranty contract, (2) the terms of the underlying contract by the holder, (3) the occurrence of the conditions upon which liability is based, and (4) the failure or refusal to perform the promise by the guarantor. Marshall v. Ford Motor Co., 878 S.W.2d 629, 631 (Tex. App.-Dallas 1994, writ denied). Again, based on the statements in Barnard's affidavit, the Bank established it was the owner and holder of the guaranty, Danpar failed to pay under the note triggering Kaspar's liability, and Kaspar refused to pay the amount owed.
Because Kaspar did not file a response to the motion for partial summary judgment or any objections to the Bank's evidence, we conclude the Bank proved all the necessary elements to recover under the guaranty. Accordingly, the trial court properly granted summary judgment as a matter of law.
In reaching this conclusion, we reject Kaspar's argument that the Bank failed to establish that it provided Kaspar with "valuable consideration" for signing the guaranty. Barnard's affidavit states that "On or about August 9, 2006 for good cause and valuable consideration, Kaspar executed an unconditional guaranty for the benefit of Danpar, as security for payment of the Note (the "Guaranty"). [Emphasis added.] Further, the guaranty itself provides that "For the purpose of inducing PATRIOT BANK (herein called "Lender") to lend money and advance credit to [Danpar]," Kaspar agreed to unconditionally guaranty the prompt and full payment to the Bank for any liabilities by Danpar when such indebtedness became due. Moreover, because the Bank brought forth evidence it provided consideration for the transaction, Kaspar was required to raise the affirmative defense of no consideration to the trial court. See, e.g., Valdez v. Pasadena Healthcare Mgmt., Inc., 975 S.W.2d 43, 45 (Tex. App.-Houston [14th Dist.] 1998, pet. denied) (noting non-movant must urge defense in its response and provide summary judgment proof to create a fact issue as to each element of the defense); Hollingsworth v. City of Dallas, 931 S.W.2d 699, 705 (Tex. App.-Dallas 1996, writ denied) (concluding a party's failure to raise an affirmative defense in its response to a motion for summary judgment constitutes waiver of the affirmative defense on appeal). This he failed to do. We overrule appellant's first issue.
We acknowledge that Kaspar also argues (1) the trial court should not have granted the partial summary judgment because it was apparent Kaspar was elderly and not mentally competent and therefore should not have been allowed to represent himself and (2) the trial court should have attempted to reach the Kaspars when they did not show up for the summary judgment hearing. Appellant has not provided this court with any record support or legal authority for these allegations. Bare assertions of error, without argument, authority, or citation to the record waives error. See Tex. R. App. P. 38.1(h); see also Denmon v. Atlas Leasing, L.L.C., 285 S.W.3d 591, 597 (Tex. App.-Dallas 2009, no pet.). Therefore, Kaspar has failed to present these arguments for review. Accordingly, we will not consider his complaints. We overrule his second and third issues as to the motion for partial summary judgment.
Agreed Judgment
We now turn to the issues raised by J.R.K., Inc. on appeal. It alleges the trial court erred by entering an agreed judgment between it and the Bank. Specifically, J.R.K., Inc. argues the court should not have entered an agreed judgment "that hands over Joanna Kaspar's (J.R.K., Inc.'s) Little Elm properties to Patriot Bank when Patriot has never shown any good cause or consideration in return." It further argues the trial court had a duty to conduct a hearing to determine if Joanna Kaspar understood what she was signing and if she had provided informed consent. It asserts her signature a week before the trial court entered judgment does not establish she consented to the judgment at the moment it was entered.
We are not persuaded by J.R.K., Inc.'s arguments. Likewise, we are not persuaded by the Bank's argument that J.R.K., Inc. failed to file a notice of appeal.
We begin by addressing the Bank's argument. The Bank contends we should not address J.R.K., Inc.'s arguments because it did not file a notice of appeal. The Texas Supreme Court has repeatedly stated "that the factor which determines whether jurisdiction has been conferred on the appellate court is not the form or substance of the bond, certificate or affidavit, but whether the instrument was a 'bona fide attempt to invoke appellate court jurisdiction.'" Warwick Towers Counsel of Co-Owners ex rel. St. Paul Fire & Marine Ins. Co. v. Park Warwick, L.P., 244 S.W.3d 838, 839 (Tex. 2008) (quoting Walker v. Blue Water Garden Apartments, 776 S.W.2d 578, 581 (Tex. 1989)).
On December 1, 2010, Kaspar filed a notice of appeal and signed the certificate of service as "Henry N. Kaspar et al." The docketing statement, filed on December 8, 2010, identifies appellants as "Henry N. Kaspar" and "JRK Inc." While we agree Kaspar did not specifically identify J.R.K., Inc. as a party in his original notice of appeal, his signature on the notice of appeal and the docketing statement both indicate his bona fide attempt to file an appeal on behalf of J.R.K., Inc. See id. Further, Kaspar filed a second notice of appeal on March 23, 2011 in which he stated "Defendant J.R.K., Inc., by and through her counsel of record, files this her notice of appeal" for judgments rendered on September 30, 2010 and June 1, 2010. Although the notice does not state it is an amended notice of appeal, it was filed before appellants' brief; therefore, under these facts we construe it to be an amended notice of appeal. See Tex. R. App. P. 25.1(g) ("An amended notice of appeal correcting a defect or omission in an earlier filed notice may be filed in the appellate court at any time before the appellant's brief is filed."). Thus, we conclude J.R.K., Inc. has properly invoked the jurisdiction of this court and we shall address its arguments regarding the agreed judgment accordingly.
A valid agreed judgment cannot be rendered by a court when consent by one of the parties is wanting. See Burnaman v. Heaton, 240 S.W.2d 288, 291 (Tex. 1951). It is not sufficient to support the judgment that a party's consent may have been given at one time; rather, consent must exist at the very moment the court undertakes to make the agreement the judgment of the court. Id. A trial court should not enter an agreed judgment if it possesses information that would reasonably prompt further inquiry, and such inquiry, if pursued, would disclose a lack of consent. Id. When consent has either been withdrawn or is lacking at the time the agreed judgment is rendered, the judgment is void. See Samples Exterminators v. Samples, 640 S.W.2d 873, 875 (Tex. 1982).
In this case, the record reflects that Joanna Kaspar signed the agreed judgment on September 24, 2010, and the trial court signed the order on September 30, 2010. J.R.K., Inc. argues that while Joanna's signature may have given consent on September 24, 2010, the record does not indicate she provided consent "at the very moment" the court signed the order, which occurred several days later. We cannot agree.
Nothing in the record indicates she tried to withdraw her consent before September 30, 2010 or that the trial court possessed any information that would reasonably prompt further inquiry concerning her lack of consent. While Kaspar argues certain circumstances should have compelled the court to hold a hearing regarding her consent, which include her advanced age, the feebleness of her signature, the inactivity by her lawyer, and the complex content of the judgment, J.R.K., Inc. has not provided any evidence that Joanna was mentally impaired or did not understand the agreement. She and her lawyer both signed the agreed judgment. Thus, nothing in the record indicates the trial court possessed information that would reasonably prompt further inquiry that could reveal a lack of consent. Because J.R.K., Inc. did not withdraw its consent, it cannot complain on appeal about the entry of the agreed judgment. See Arriaga v. Cavazos, 880 S.W.2d 830, 832 (Tex. App.-San Antonio 1994, no writ) (stating a party has the right to revoke his consent to a settlement agreement any time before the rendition of judgment, but not after rendition). We overrule J.R.K., Inc.'s first issue. Having reached this conclusion, we need not address issues two, three, and four regarding the validity of the quitclaim deed signed by Kaspar.
In its final issue, J.R.K., Inc. argues the trial court erred by not requiring a court reporter to make a record of the proceedings. However, this argument is only mentioned in the summary of the argument section and it relates to the granting of the summary judgment against Kaspar, not the agreed judgment against J.R.K., Inc. Regardless, the trial court did not err. Court reporters are neither necessary nor appropriate at summary judgment hearings because no testimony is received. See Olsen v. Comm'n for Lawyer Discipline, 347 S.W.3d 876, 885 (Tex. App.-Dallas 2011, no pet.). We overrule J.R.K., Inc.'s final issue. Conclusion
Having overruled Kaspar's and J.R.K., Inc.'s arguments, we affirm the trial court's judgments.
MICHAEL J. O'NEILL
JUSTICE
101530F.P05
Court of Appeals Fifth District of Texas at Dallas JUDGMENT
HENRY N. KASPAR AND J.R.K., INC., Appellants
V.
PATRIOT BANK, Appellee
No. 05-10-01530-CV
Appeal from the 298th Judicial District Court of Dallas County, Texas. (Tr.Ct.No. DC-09- 05714).
Opinion delivered by Justice O'Neill, Justices Richter and Lang-Miers, participating.
In accordance with this Court's opinion of this date, the judgment of the trial court is AFFIRMED. It is ORDERED that appellee Patriot Bank recover its costs of this appeal from appellant Henry N. Kaspar and J.R.K., Inc.
Judgment entered June 8, 2012.
MICHAEL J. O'NEILL
JUSTICE