Hong Kong Development, Inc., Hai Du Duong, and Phuong Truong Tu v. Kim Loan Nguyen D/B/A Alpha Bakery

CourtCourt of Appeals of Texas
DecidedJune 7, 2007
Docket01-04-00586-CV
StatusPublished

This text of Hong Kong Development, Inc., Hai Du Duong, and Phuong Truong Tu v. Kim Loan Nguyen D/B/A Alpha Bakery (Hong Kong Development, Inc., Hai Du Duong, and Phuong Truong Tu v. Kim Loan Nguyen D/B/A Alpha Bakery) is published on Counsel Stack Legal Research, covering Court of Appeals of Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Hong Kong Development, Inc., Hai Du Duong, and Phuong Truong Tu v. Kim Loan Nguyen D/B/A Alpha Bakery, (Tex. Ct. App. 2007).

Opinion

Opinion issued June 7, 2007





In The

Court of Appeals

For The

First District of Texas



NO. 01-04-00586-CV



HONG KONG DEVELOPMENT, INC., HAI DU DUONG, and PHUONG TRUONG TU, Appellants



V.



KIM LOAN NGUYEN D/B/A ALPHA BAKERY, Appellee



On Appeal from County Civil Court at Law No. 1

Harris County, Texas

Trial Court Cause No. 802024 (Consolidated with Cause No. 793,769)



OPINION ON REHEARING



Appellee, Kim Loan Nguyen ("Nguyen"), has filed a motion for rehearing of the Court's opinion dated November 9, 2006. Appellants, Hong Kong Development, Inc. ("HKDI"), Hai Du Duong ("Duong"), and Phuong Truong Tu ("Tu") (collectively, "appellants") have responded to that motion. After due consideration, the Court grants Nguyen's motion for rehearing, withdraws its judgment and opinion of November 9, 2006, and issues this opinion and judgment in their stead.

Appellants appeal from a judgment, rendered upon a jury verdict, in favor of Nguyen for $15,312.58 in actual damages against HKDI and Duong, jointly and severally; $200,000 in punitive damages against each of HKDI and Duong; and $79,900 in attorney's fees against all three appellants, jointly and severally. We determine (1) over what appellate challenges we have jurisdiction; (2) whether the trial court erred in consolidating an appeal pending before it in a forcible-detainer suit with a suit in which Nguyen, invoking the court's original jurisdiction, had asserted various tort and declaratory claims; (3) whether the error in consolidating the suits, if any, was rendered moot; (4) whether the evidence is legally sufficient to support liability, actual damages, and punitive damages against HKDI and Duong; (5) whether Tu had a duty to indemnify Nguyen for her attorney's fees; and (6) whether the trial court erred in rendering judgment for attorney's fees that Nguyen's expert did not segregate among claims and defenses for which fees were recoverable and those for which they were not. We reverse the judgment in part, affirm it in part, and remand the cause for limited proceedings.

Background

Tu and Nguyen were sisters-in-law. Tu, Nguyen, and Nguyen's sister entered into a partnership to run a bakery and sandwich shop called Alpha Bakery. In February of that same year, Tu and Nguyen leased space for their business in HKDI's shopping mall. The lease that they executed with HKDI ("the lease agreement") listed Tu and Nguyen as "Tenant" and contained the following provisions:

24. ASSIGNMENT AND SUBLETTING BY TENANT

24.1 Tenant shall not assign this Lease, or any interest therein, . . . without first obtaining the written consent of Landlord. . . . Any assignment . . . without the prior written consent of Landlord shall be void and shall, at the option of Landlord, terminate this Lease. This Lease shall not, nor shall any interest therein, be assignable, as to the interest of Tenant, by operation of law, without the prior written consent of Landlord. However, it is further understood and agreed that Tenant shall not sell, convey, or assign any interest in the corporation [sic] without prior written approval from Landlord, and if Landlord does not agree to the sale, conveyance or assignment of the corporation [sic], Landlord may, at Landlord's option, terminate this Lease.



. . . .

57. MISCELLANEOUS

57.2 Acceptance of Rental by Landlord from Tenant or any assignee, subtenant or other successor in interest of Tenant, or the payment or tender of any Rental to Landlord, with or without notice, shall never be construed as a waiver of any breach of any term, condition or covenant of this Lease. The failure of Landlord to declare any Event of Default upon the occurrence thereof, or any delay by Landlord in taking action with respect thereto shall not waive such default, but Landlord shall have the right to declare such default at any time and to take such action as may be authorized hereunder to the extent herein provided.



Duong, HKDI's president and owner, signed the lease agreement on behalf of HKDI.

Tu's and Nguyen's relationship soured a few years later, about the time that Nguyen and her husband, Tu's brother, began divorce proceedings. The partners' dispute led to a lawsuit ("the partnership suit"), and the partnership eventually went into receivership. The jury in the partnership suit awarded Nguyen and her sister, also a partner, 70% of the partnership; awarded Tu 30% of the partnership; and awarded actual damages to Nguyen and attorney's fees to Nguyen and her sister. (1) In a separate receivership sale of Alpha Bakery, Nguyen purchased the business. Final paperwork for the sale was drawn up, including a contract assigning Tu's lease interest to Nguyen ("the lease assignment"), as well as a contract assigning Tu's partnership interest to Nguyen ("the partnership assignment"). No one obtained HKDI's consent to the lease assignment, despite the lease agreement's requirement that HKDI's written consent be obtained as a precondition to any assignment of the leasehold interest. Nonetheless, Nguyen and Tu signed the documents, including the lease assignment.

In a nutshell, Nguyen's position in the current suit was that she and Tu had signed the lease assignment without HKDI's written consent under duress because the trial court in the partnership suit had ordered them to sign it under threat of contempt. She also alleged that Tu's counsel in the partnership suit, who had represented HKDI in other matters, had implied in the partnership suit that he was representing both Tu and HKDI and that HKDI would not object to the assignment. Nguyen also took the position in the current lawsuit that Tu, HKDI, and Duong had conspired, for various reasons, to have the parties execute the lease assignment without first obtaining HKDI's written consent so that Nguyen could be declared in default, HKDI could evict her, and Tu could open a competing restaurant in the same mall. HKDI, Duong, and Tu disputed the validity of Nguyen's theories.

In May 2003, HKDI notified Nguyen and Tu that they were in default under the lease because HKDI's consent had not been obtained to the lease assignment and instructed them to vacate the premises. Later that month, Nguyen sued HKDI, Duong, and Tu in Harris County Civil Court at Law No. 3 ("the tort suit"). (2)

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Texas Department of Parks & Wildlife v. Miranda
133 S.W.3d 217 (Texas Supreme Court, 2004)
In Re Prudential Insurance Co. of America
148 S.W.3d 124 (Texas Supreme Court, 2004)
In Re Van Waters & Rogers, Inc.
145 S.W.3d 203 (Texas Supreme Court, 2004)
Chon Tri v. J.T.T.
162 S.W.3d 552 (Texas Supreme Court, 2005)
Thomas v. Long
207 S.W.3d 334 (Texas Supreme Court, 2006)
Young v. Neatherlin
102 S.W.3d 415 (Court of Appeals of Texas, 2003)
Wal-Mart Stores, Inc. v. Miller
102 S.W.3d 706 (Texas Supreme Court, 2003)
French v. Moore
169 S.W.3d 1 (Court of Appeals of Texas, 2004)
Texas Natural Resource Conservation Commission v. IT-Davy
74 S.W.3d 849 (Texas Supreme Court, 2002)
In Re Bill Heard Chevrolet, Ltd.
209 S.W.3d 311 (Court of Appeals of Texas, 2006)
State v. Delany
197 S.W.3d 297 (Texas Supreme Court, 2006)
American Motorists Insurance Co. v. Fodge
63 S.W.3d 801 (Texas Supreme Court, 2002)
Gibson v. Dynegy Midstream Services, L.P.
138 S.W.3d 518 (Court of Appeals of Texas, 2004)
Villalon v. Bank One
176 S.W.3d 66 (Court of Appeals of Texas, 2004)
Anarkali Enterprises, Inc. v. Riverside Drive Enterprises, Inc.
802 S.W.2d 25 (Court of Appeals of Texas, 1991)
Cecil v. Smith
804 S.W.2d 509 (Texas Supreme Court, 1991)
Hudson v. Wakefield
711 S.W.2d 628 (Texas Supreme Court, 1986)
Merrell Dow Pharmaceuticals, Inc. v. Havner
953 S.W.2d 706 (Texas Supreme Court, 1997)
Hanks v. Lake Towne Apartments
812 S.W.2d 625 (Court of Appeals of Texas, 1991)
In Re Dickason
987 S.W.2d 570 (Texas Supreme Court, 1998)

Cite This Page — Counsel Stack

Bluebook (online)
Hong Kong Development, Inc., Hai Du Duong, and Phuong Truong Tu v. Kim Loan Nguyen D/B/A Alpha Bakery, Counsel Stack Legal Research, https://law.counselstack.com/opinion/hong-kong-development-inc-hai-du-duong-and-phuong-truong-tu-v-kim-loan-texapp-2007.