AFFIRM; Opinion issued November 28, 2012
S In The Court of Appeals Fifth District of Texas at Dallas )))))))))))))))))))))))))))) No. 05-11-01625-CV ))))))))))))))))))))))))))))
YIGAL BOSCH, Appellant
V.
CIRRO GROUP, INC., Appellee
4444444444444444444444444444444444444444444444444444444444444 On Appeal from the 296th Judicial District Court Collin County, Texas Trial Court Cause No. 296-01627-2011 4444444444444444444444444444444444444444444444444444444444444
MEMORANDUM OPINION Before Morris, Francis, and Murphy Opinion By Justice Francis
Yigal Bosch appeals the trial court’s summary judgment against him on Cirro Group, Inc.’s
claim for officer and director liability under section 171.255(a) of the Texas Tax Code. We affirm.
Cirro contracted with AYS Enterprises, Inc. to provided electrical service to four commercial
properties. When AYS failed to pay, Cirro sued several defendants on multiple causes of action.
One defendant was Bosch. The allegation against him is as follows. During the time Cirro provided
service, the owners of the properties filed for bankruptcy under chapter 11. The bankruptcy cases
were jointly administered, and one of Bosch’s companies, 2646 Atrium Realty Group, served as the
management company for the entities. All of the properties were sold or foreclosed upon during the
bankruptcy. Thereafter, the bankruptcy trustee filed a motion to determine the final administrative claim of the managcment company and authority to pay the same. In support ofthe administrative
claim. Atrium sought payment for expenses for management of the entities. The bankruptcy court
signed an order allowing the claim and authorizing disbursement of funds to Atrium for which
$59,187.48 constituted payment for Cirro charges. Cirro presented evidence that it received only
$18,932.31 and never received the balance of the funds. At the time Atrium received the
disbursement, its corporate privileges had been forfeited.
Cirro moved for summary judgment against Bosch, AYS. and Atrium, and the trial court
granted the motion. The remaining defendants were disposed of by either nonsuit or default
judgment. Bosch. who is representing himseli is the only defendant to appeal. With respect to him,
the judgment ordered that Cirro recover from Bosch $40,255. 17 (the difference between the amount
disbursed for payment by the bankruptcy court and the amount actually distributed to Cirro) on
Cirro’s claim of officer and director liability and also ordered that Bosch take nothing on his
counterclaims.
In six issues, Bosch asserts the trial court (I) abused its discretion by “not attending” to his
motion to transfer venue, (2) erred in finding him responsible for Atrium’s debt, (3) “erred in
finding” that he signed the agreement with Cirro on behalf of AYS, (4) “erred in finding that
¶Deemed Admitted’ was sufficient to decide this case”, (5) erred in failing to make findings offact
and conclusions of law, and (6) erred in disallowing his counterclaim.’
Before addressing the merits of Bosch’s claims, we first observe that in some issues, it
appears that Bosch is raising complaints of other defendants who are not parties to this appeal and
that are irrelevant to the officer and director liabifity judgment against him. Although we will
1n his Issues Presented on Appeal, Bosch includes mother issue: “The Trial Court erred in finding Appellmt breached the contract” Bosch 1 did not include my briefing on this issue md we therefiwe do not address it.
—2— liberally construe Bosch s issues. we will not address issues unrelated to the judgment against him
nor will we make arguments for him.
in his lirst issue. Bosch complains the trial court abused its discretion by failing to rule on
his motion to transfer venue. Complaints about improper venue must he raised in a motion to
translr venue under Texas Rule of Civil Procedure 86. Rule 86 provides that an objection to
improper venue is waived if not made by written motion filed prior to or concurrently with any other
plea. pleading or motion except a special appearance motion provided for in rule 1 20a. TEXAs RuiE
OF CiviL PROcEDuRE 86.1. The record shows that Bosch filed his motion to transfer venue three
months after he filed his answer and counterclaim in this suit; consequently, any objection to venue
was waived. We overrule the first issue.
In his second issue. Bosch argues the trial court erred in holding him personally responsible
for Atriums debt under section 171.255(a) of the Texas Tax Code. He argues the statute applies
only to delinquent taxes, not any other corporate liabilities. We disagree.
Chapter 1 71 of the tax code governs franchise taxes. Under section 1 71 .25 1 the comptroller ,
shall forfeit the corporate privileges of a corporation on which the franchise tax is imposed if the
corporation fails to file the required report, pay the tax imposed, or fails to permit the comptroller
to examine the corporate records. See TEx. TAX CODE § 171.251 (West 2008). If the corporate
privileges of a corporation are forfeited, each director or officer of the corporation is liable for a debt
of the corporation as provided by section 17 1.255. TEx. TAx CODE § 171.252(2).
Section 171.255(a) provides:
(a) If the corporate privileges of a corporation are forfeited for the failure to file a report or pay a tax or penalty. each director or officer of the corporation is liable for each debt of the corporation that is created or incurred in this state after the date on which the report. tax, or penalty is due and before the corporate privileges are revived. The liability includes liability lbr any tax or penalty imposed by this chapter on the corporation that becomes due and payable after the date of the forfliture.
TEx. lAX Coma 171.255(a).
Nothing in the wording of this statute suggests that personal liability of officers and directors
is limited to the tax liability. Rather, the statute expressly provides that officers and directors are
liable for “each debt’ incurred under certain circumstances and “includes’ any tax or penalty due and
payable after the date of forfeiture. Because the plain wording of the statute is contrary to Bosch’s
argument. we conclude his complaint is without merit. Bosch has not challenged the sufficiency of
the evidence presented by Cirro to prove the statutory elements of its claim; therefore. we do not
make an evidentiary review. We overrule the second issue.
In his third issue, Bosch contends the trial court “erred in finding” that he signed an
agreement on behalf of AYS during 2009. Initially, we note the trial court made no such finding.
Further. whether Bosch signed an agreement on behalf of AYS may have been relevant to Cirro’s
claim against AYS but is not relevant to the judgment against Bosch as officer and director of
Atrium. AYS is not a party to this appeal; therefore, we will not address issues related to the
judgment against it. We overrule the third issue.
In his fourth issue, Bosch complains the trial court “erred in finding that ‘Deemed Admitted’
was sufficient to decide this case. Within this issue. Bosch complains the trial court accepted
deemed admissions as conclusive evidence against AYS when there was contradictory evidence.
Again. AYS has not appealed, and we will not consider issues related to the judgment against it. We
overrule the fourth issue.
In his fifth issue, Bosch contends the trial court erred in failing to make findings of fact and
Free access — add to your briefcase to read the full text and ask questions with AI
AFFIRM; Opinion issued November 28, 2012
S In The Court of Appeals Fifth District of Texas at Dallas )))))))))))))))))))))))))))) No. 05-11-01625-CV ))))))))))))))))))))))))))))
YIGAL BOSCH, Appellant
V.
CIRRO GROUP, INC., Appellee
4444444444444444444444444444444444444444444444444444444444444 On Appeal from the 296th Judicial District Court Collin County, Texas Trial Court Cause No. 296-01627-2011 4444444444444444444444444444444444444444444444444444444444444
MEMORANDUM OPINION Before Morris, Francis, and Murphy Opinion By Justice Francis
Yigal Bosch appeals the trial court’s summary judgment against him on Cirro Group, Inc.’s
claim for officer and director liability under section 171.255(a) of the Texas Tax Code. We affirm.
Cirro contracted with AYS Enterprises, Inc. to provided electrical service to four commercial
properties. When AYS failed to pay, Cirro sued several defendants on multiple causes of action.
One defendant was Bosch. The allegation against him is as follows. During the time Cirro provided
service, the owners of the properties filed for bankruptcy under chapter 11. The bankruptcy cases
were jointly administered, and one of Bosch’s companies, 2646 Atrium Realty Group, served as the
management company for the entities. All of the properties were sold or foreclosed upon during the
bankruptcy. Thereafter, the bankruptcy trustee filed a motion to determine the final administrative claim of the managcment company and authority to pay the same. In support ofthe administrative
claim. Atrium sought payment for expenses for management of the entities. The bankruptcy court
signed an order allowing the claim and authorizing disbursement of funds to Atrium for which
$59,187.48 constituted payment for Cirro charges. Cirro presented evidence that it received only
$18,932.31 and never received the balance of the funds. At the time Atrium received the
disbursement, its corporate privileges had been forfeited.
Cirro moved for summary judgment against Bosch, AYS. and Atrium, and the trial court
granted the motion. The remaining defendants were disposed of by either nonsuit or default
judgment. Bosch. who is representing himseli is the only defendant to appeal. With respect to him,
the judgment ordered that Cirro recover from Bosch $40,255. 17 (the difference between the amount
disbursed for payment by the bankruptcy court and the amount actually distributed to Cirro) on
Cirro’s claim of officer and director liability and also ordered that Bosch take nothing on his
counterclaims.
In six issues, Bosch asserts the trial court (I) abused its discretion by “not attending” to his
motion to transfer venue, (2) erred in finding him responsible for Atrium’s debt, (3) “erred in
finding” that he signed the agreement with Cirro on behalf of AYS, (4) “erred in finding that
¶Deemed Admitted’ was sufficient to decide this case”, (5) erred in failing to make findings offact
and conclusions of law, and (6) erred in disallowing his counterclaim.’
Before addressing the merits of Bosch’s claims, we first observe that in some issues, it
appears that Bosch is raising complaints of other defendants who are not parties to this appeal and
that are irrelevant to the officer and director liabifity judgment against him. Although we will
1n his Issues Presented on Appeal, Bosch includes mother issue: “The Trial Court erred in finding Appellmt breached the contract” Bosch 1 did not include my briefing on this issue md we therefiwe do not address it.
—2— liberally construe Bosch s issues. we will not address issues unrelated to the judgment against him
nor will we make arguments for him.
in his lirst issue. Bosch complains the trial court abused its discretion by failing to rule on
his motion to transfer venue. Complaints about improper venue must he raised in a motion to
translr venue under Texas Rule of Civil Procedure 86. Rule 86 provides that an objection to
improper venue is waived if not made by written motion filed prior to or concurrently with any other
plea. pleading or motion except a special appearance motion provided for in rule 1 20a. TEXAs RuiE
OF CiviL PROcEDuRE 86.1. The record shows that Bosch filed his motion to transfer venue three
months after he filed his answer and counterclaim in this suit; consequently, any objection to venue
was waived. We overrule the first issue.
In his second issue. Bosch argues the trial court erred in holding him personally responsible
for Atriums debt under section 171.255(a) of the Texas Tax Code. He argues the statute applies
only to delinquent taxes, not any other corporate liabilities. We disagree.
Chapter 1 71 of the tax code governs franchise taxes. Under section 1 71 .25 1 the comptroller ,
shall forfeit the corporate privileges of a corporation on which the franchise tax is imposed if the
corporation fails to file the required report, pay the tax imposed, or fails to permit the comptroller
to examine the corporate records. See TEx. TAX CODE § 171.251 (West 2008). If the corporate
privileges of a corporation are forfeited, each director or officer of the corporation is liable for a debt
of the corporation as provided by section 17 1.255. TEx. TAx CODE § 171.252(2).
Section 171.255(a) provides:
(a) If the corporate privileges of a corporation are forfeited for the failure to file a report or pay a tax or penalty. each director or officer of the corporation is liable for each debt of the corporation that is created or incurred in this state after the date on which the report. tax, or penalty is due and before the corporate privileges are revived. The liability includes liability lbr any tax or penalty imposed by this chapter on the corporation that becomes due and payable after the date of the forfliture.
TEx. lAX Coma 171.255(a).
Nothing in the wording of this statute suggests that personal liability of officers and directors
is limited to the tax liability. Rather, the statute expressly provides that officers and directors are
liable for “each debt’ incurred under certain circumstances and “includes’ any tax or penalty due and
payable after the date of forfeiture. Because the plain wording of the statute is contrary to Bosch’s
argument. we conclude his complaint is without merit. Bosch has not challenged the sufficiency of
the evidence presented by Cirro to prove the statutory elements of its claim; therefore. we do not
make an evidentiary review. We overrule the second issue.
In his third issue, Bosch contends the trial court “erred in finding” that he signed an
agreement on behalf of AYS during 2009. Initially, we note the trial court made no such finding.
Further. whether Bosch signed an agreement on behalf of AYS may have been relevant to Cirro’s
claim against AYS but is not relevant to the judgment against Bosch as officer and director of
Atrium. AYS is not a party to this appeal; therefore, we will not address issues related to the
judgment against it. We overrule the third issue.
In his fourth issue, Bosch complains the trial court “erred in finding that ‘Deemed Admitted’
was sufficient to decide this case. Within this issue. Bosch complains the trial court accepted
deemed admissions as conclusive evidence against AYS when there was contradictory evidence.
Again. AYS has not appealed, and we will not consider issues related to the judgment against it. We
overrule the fourth issue.
In his fifth issue, Bosch contends the trial court erred in failing to make findings of fact and
conclusions of law and, for authority, relies on 1KB Industries (Nigeria,..i Ltd. v. Pro-Line Corp., 938
—4- S.W.2d 440 ([cx. 1997). Bosch misreads 1k/I Jndur!rft’v.
In 1KB lInlilsIriL’s. the supreme court addressed whether findings of hict and conclusion of
law ftllowing the dismissal of a case for sanctions for discovery abuse extend the appellate
timetable. In addressing the issue, the court restated its prior determination that a sumrnaryj udgrnent
is not a trial and that tindings of fact and conclusions ol law have no place in a summary judgment
proceeding. 1KB Inc/us.. 938 S.W.2d at 441 (quoting Linuooc/v. N(’iVB Tex. 885 S.W.2d 102. 103
(Tex. 1994)). The court explained that for summary judgment to he proper, “there are no facts to
find, and the legal conclusions have already been stated in the motion and response. The trial court
should not make, and an appellate court cannot consider, findings of fact in connection with a
summary judgment.” Id. We overrule the fifth issue.
In his sixth issue, Bosch contends the trial court erred in disallowing his counterclaim against
Cirro. He argues, without citation to the record or to the law, that Cirro’s pleading against him was
groundless and brought in bad faith. Given our disposition of Bosch’s issues, we conclude this issue
is without merit. We overrule the sixth issue.
We affirm the trial court’s judgment.
(H 2(.
MOLLY FRANCIS JUSTICE
ii 1625F.P05 QILI1IrI tif pprtt .Fifth Ditrirt of Jixwi at Oa1ta
JUDGMENT YIGAL I3OSC1I. Appellant Appeal from the 296th Judicial District Court of Collin County, Texas. (Tr.Ct.No. No. 05-1 l-01625-CV V. 296-01627-201 1). Opinion delivered by Justice Francis. CIRRO GROUP. INC.. Appellee Justices Morris and Murphy participating.
In accordance with this Court’s opinion of this date. the judgment of the trial court is AFFIRMED. It is ORDERED that appellce Cirro Group, Inc. recover its costs of this appeal from appellant Yigal Bosch.
Judgment entered November 28, 2012.
MOI.I.Y FR (‘lx .JL IS Fl(’l;