Donald L. McManus v. Sears, Roebuck and Co.

• Court: Court of Appeals of Texas
• Decided: August 28, 2003
• Docket: 09-02-00472-CV
• Status: Published

Opinion

In The

Court of Appeals

Ninth District of Texas at Beaumont

____________________

NO. 09-02-472 CV

DONALD L. MCMANUS, Appellant

V.

SEARS, ROEBUCK AND CO., Appellee

On Appeal from the County Court at Law No. 2

Montgomery County, Texas

Trial Cause No. 01-07-04566-CV

MEMORANDUM OPINION ⁽¹⁾

Donald L. McManus appeals the judgment of the trial court granting summary judgment to Sears, Roebuck & Company ("Sears") for $6,317.54 plus $2,200 in attorneys' fees, while granting a take-nothing judgment on McManus's counterclaims against Sears. Sears sued McManus to collect on credit card debt allegedly owed by McManus. Three issues are raised on appeal: 1) McManus contends there exists a factual dispute as to whether the credit card in question was issued by Sears, Roebuck & Company or Sears National Bank; 2) the trial court erred in granting summary judgment dismissing McManus's counterclaim for usury; and 3) the trial court erred in dismissing McManus's claims for violations by Sears of the Texas Deceptive Trade Practices Act. For the reasons stated below, we affirm.

In its petition, Sears alleged it was the current holder of a credit card account issued by Sears National Bank to McManus and that the balance due on the account was $6,317.54, which McManus refused to pay despite demand that he do so. Sears sought recovery for the amount due, 10% post-judgment interest, and reasonable and customary attorney's fees. In his responsive pleading, McManus asserted, inter alia, that he had not entered into any agreements with Sears National Bank, and raised as affirmative defenses and counterclaims usury and violations by Sears of the Texas Deceptive Trade Practices Act. Sears moved for regular summary judgment on its claims and McManus's counterclaims, and alternatively sought a "no-evidence" summary judgment on McManus's counterclaims. Tex. R. Civ. P. 166a(c), (i).

Summary Judgment

In reviewing the trial court's granting of summary judgment, we follow the well-established rule: 1) the movant for summary judgment has the burden of showing that there is no genuine issue of material fact and that it is entitled to judgment as a matter of law; 2) in deciding whether there is a disputed material fact issue precluding summary judgment, evidence favorable to the non-movant will be taken as true; and 3) every reasonable inference must be indulged in favor of the non-movant and any doubts resolved in its favor. Nixon v. Mr. Property Management Co., 690 S.W.2d 546, 548-49 (Tex. 1985). Plaintiff, as movant, must conclusively prove all essential elements of its claim. Howard v. INA County Mut. Ins. Co., 933 S.W.2d 212, 216 (Tex. App.--Dallas 1996, writ denied).

Issue One

In a suit on sworn account, the status of the plaintiff, whether a bank or a merchant, may be significant in whether that remedy is available.

In a suit on account, plaintiff is required to prove: 1) the sale and delivery of merchandise or performance of services; 2) that the amount of the account is "just," that is, the prices charged are pursuant to an express agreement, or in the absence of an agreement, that the charges are usual, customary, or reasonable; and 3) that the outstanding amounts remain unpaid. Powers v. Adams, 2 S.W.3d 496, 499 (Tex. App.--Houston [14th Dist.] 1999, no pet.); Tex. R. Civ. P. 185. In its brief, Sears argues that it has met the requirements of a suit on sworn account as set forth in Tex. R. Civ. P. 185.

Although not raised in the briefs, we note that several Texas courts of appeals have held that Rule 185 is not applicable to unpaid debt arising from the use of a credit card issued by a bank. This is because such a credit card evidences only a line of credit extended by the bank by which the card holder may use to purchase goods and services from a third party, and not the purchase itself. See Bird v. First Deposit Nat. Bank, 994 S.W.2d 280, 282 (Tex. App.--El Paso 1999, pet. denied). ⁽²⁾ Sears alleged that it performed and rendered personal services "in the form of financial, accounting, billing, and retail- purchase facilitating services. . . ." "Retail purchasing facilitating services" is no more than the extension of a line of credit. The billing and accounting were not done for McManus's benefit, but rather to keep track of how much McManus owed Sears. Although no allegation was made that McManus purchased goods or services from Sears, in its Motion for Summary Judgment Sears alleged that, while McManus entered into an agreement with Sears National Bank, he purchased goods and services from Sears, who subsequently became the assignee of the rights of Sears National Bank. As summary judgment evidence, Sears submitted McManus's Responses to Requests for Admissions, in which he admitted that Sears, Roebuck & Co. was the proper party plaintiff, and that the credit card issued to him was issued by Sears, Roebuck & Co. McManus did not deny under oath in his pleadings or in his response to the motion for summary judgment that he purchased goods and services from Sears in the amount of $6,317.54, as alleged in the petition and the motion for summary judgment, or that said amount remained unpaid. Thus, we have a suit involving the seller of the goods and services, Sears, against the purchaser of the goods and services, McManus, to recover the amount owing on the account, the amount due and non-payment being undisputed. Whether the credit card was issued by Sears National Bank or Sears is not a material fact, i.e., a fact that will affect the outcome of the suit under the governing law. See West Trinity Properties v. Chase Manhattan, 92 S.W.3d 866, 869 (Tex. App.--Texarkana 2002, no pet.). There is, therefore, no genuine issue of material fact; all elements of a suit on account have been met; and Sears is entitled to judgment as a matter of law on the suit for account. Issue one is overruled.

Issue Two

In his second issue, McManus contends that the trial court erred in granting summary judgment dismissing his counterclaim for usury. The required elements to establish that a transaction is usurious are: 1) a loan of money; 2) an absolute obligation to repay the principal; and 3) the exaction of a greater compensation than allowed by law for the use of the money by the borrower. First Bank v. Tony's Tortilla Factory, Inc., 877 S.W.2d 285, 287 (Tex. 1994).

In response to Sears's no-evidence motion for summary judgment regarding his usury claim, McManus submitted, inter alia, his own affidavit and Exhibit C, described in the response to the motion as "a statistical summary of the advances and interest rates charged by Sears, Roebuck and Co." Sears objected to these offerings, contending that they were conclusory and hearsay.

The affidavit of an interested party is competent summary judgment evidence if the testimony set forth therein is: 1) clear, positive and direct; 2) otherwise credible and free from contradictions and inconsistencies; and 3) susceptible to being readily controverted. Maldonado v. Frio Hosp. Ass'n, 25 S.W.3d 274, 277 (Tex. App.--San Antonio 2000, no pet.). McManus's affidavit stated that he "was told" and "understood" that the credit card was issued by Sears. However, the affidavit states neither the identity of the person who told him nor the factual basis for his understanding, and, as such, is neither clear, positive and direct, nor susceptible of being readily controverted. Id. Further, such evidence is hearsay, inadmissible over objection as summary judgment evidence. Querner Truck Lines, Inc. v. Alta Verde Industries, Inc., 747 S.W.2d 464, 467-68 (Tex. App.--San Antonio 1988, no writ). In addition, McManus's statements that he agreed that the interest rate charged exceeded 24% are mere conclusions, unsupported by facts, and do not constitute competent summary judgment evidence. Trunkhill Capital, Inc. v. Jansma, 905 S.W.2d 464, 470 (Tex. App.--Waco 1995, writ denied). An affidavit must not contain information that is merely a unilateral and subjective determination of the facts. Querner, 747 S.W.2d at 468.

Regarding Exhibit C, other than the description set forth in the response to the motion for summary judgment, no explanation was presented to the trial court as to the who, what, where or why of these calculations. Such information submitted in a form not admissible at trial does not constitute competent summary judgment evidence. Trunkhill Capital, 905 S.W.2d at 469. Issue two is overruled.

Issue Three

In his third issue, McManus contends he produced sufficient summary judgment evidence to preclude dismissal of his claims made under the Texas Deceptive Trade Practices Act. He contends that his summary judgment evidence established a genuine issue of material fact as to whether Sears engaged in false, misleading, or deceptive acts or practices by: 1) passing off goods or services as those of another; 2) causing confusion or misunderstanding as to the source, sponsorship, approval, or certification of goods or services; or 3) causing confusion or misunderstanding as to affiliation, connection, or association with, or certification by, another. See Tex. Bus. & Com. Code Ann. §§ 17.46(b)(1), (2) and (3) (Vernon 2002). A no-evidence summary judgment is reviewed on appeal under the same legal sufficiency standard as a directed verdict. The evidence is viewed in the light most favorable to the non-movant, disregarding all contrary evidence and inferences. The no-evidence summary judgment will be sustained if: 1) there is a complete absence of a vital fact; 2) we are barred by rules of law or evidence from giving weight to the only evidence offered to prove a vital fact; 3) the evidence offered is no more than a mere scintilla; or 4) the evidence offered conclusively establishes the opposite of a vital fact. If the proffered summary judgment evidence is so weak as to create no more than a mere surmise or suspicion of a vital fact, less than a scintilla of evidence exists because such evidence lacks probative force, and in legal effect, is no evidence at all. Boales v. Brighton Builders, Inc., 29 S.W.3d 159, 164 (Tex. App.--Houston [14th Dist.] 2000, pet. denied).

As we stated above, McManus's summary judgment evidence regarding his alleged confusion over which Sears entity issued him the credit card was merely conclusory, without factual support. The statements in his affidavit were merely his "unilateral and subjective determination of the facts . . .," not competent summary judgment evidence. Querner Truck Lines, Inc. v. Alta Verde Industries, Inc., 747 S.W.2d at 468. There was certainly less than a scintilla of evidence. We also note that actual damages are required to state a cause of action under the Texas Deceptive Trade Practices Act. Tex. Bus. & Com. Code Ann. § 17.50(a) (Vernon 2002); Gulf States Utilities Co. v. Low, 79 S.W.3d 561, 567 (Tex. 2002). Even if we accept as true McManus's bare allegations that his confusion was caused by the acts of Sears, there were no allegations as to why or how this would result in his being entitled to damages, or eliminate or reduce the undisputed amount of his credit card debt to Sears. This issue is overruled and the judgment of the trial court is affirmed.

AFFIRMED.

______________________________

STEVE MCKEITHEN

Chief Justice

Submitted on August 15, 2003

Opinion Delivered August 28, 2003

Before McKeithen, C.J., Burgess and Gaultney, JJ.

1. Tex. R. App. P. 47.4.

2.

See also Young v. American Exp. Co., 2001 Tex. App. LEXIS 7217 at **2 and 3 (Tex. App.--Texarkana 2001, no pet. h.) (not designated for publication); Dunham v. Providian Nat. Bank, 2002 Tex. App. LEXIS 1021 at ** 2 and 3 (Tex. App.--Houston [14th Dist.] 2002, no pet. h.) (not designated for publication).