Karen Ann Cervantes Gatlin v. Joey Moore, Representative of the Estate of Joe Sam Irvine

• Court: Court of Appeals of Texas
• Decided: February 21, 2013
• Docket: 01-11-00738-CV
• Status: Published

Opinion

Opinion issued February 21, 2013.

In The

Court of Appeals For The

First District of Texas ——————————— NO. 01-11-00738-CV ——————————— KAREN ANN CERVANTES GATLIN, Appellant V. JOEY MOORE, REPRESENTATIVE OF THE ESTATE OF JOE SAM IRVINE, DECEASED, Appellee

On Appeal from the 10th District Court Galveston County, Texas Trial Court Case No. 09-CV-0187

MEMORANDUM OPINION

Appellant Karen Gatlin appeals a judgment entered against her in favor of

Joey Moore, appellee. Moore, on behalf of the estate of her deceased father, Joe

Sam Irvine, sued Karen and Chris Gatlin for breach of contract, statutory fraud, misrepresentation, violation of Texas Property Code Subchapter D, and quantum

meruit. Sitting without a jury, the trial court awarded Moore $22,527.89 based on

the theory of quantum meruit. In three points of error, Gatlin contends: (1) Moore

lacked standing to bring this suit; (2) the evidence is legally and factually

insufficient to support the judgment; and (3) the trial court erred by admitting

Moore’s damages evidence because Moore did not disclose the evidence in

discovery. We affirm.

Background

In 2004, Irvine moved into a house in Crystal Beach, which was owned by

Gatlin. On April 13, 2005, Irvine and Gatlin signed a handwritten document

reflecting the sale of the house by Gatlin to Irvine. This document reflects the

address of the house, a “down payment” of $10,000, a balance of $75,000, and the

signatures of Irvine and Gatlin, both of which are dated April 13, 2005. The

document also shows that Irvine later made payments of $20,000 and $5,000 and

that the balance remaining as of July 1, 2005, was $50,000. Bank records show

that Irvine made additional periodic payments to Gatlin. While Irvine lived in the

house, he hired his neighbor, Lynn Stansbury, to make various improvements to

the house.

After Irvine’s death in 2007, Moore and her husband collected Irvine’s

possessions from the house and found the handwritten document reflecting Irvine’s

2 purchase of the house. Eventually, Moore opened probate proceedings in

Louisiana and obtained a Judgment of Possession, which recognized Moore as the

sole heir of Irvine’s estate, but did not include the Crystal Beach house in the

estate’s property. The Gatlins moved back into the Crystal Beach house, but the

home was later destroyed by Hurricane Ike.

Moore, on behalf of Irvine’s estate, sued the Gatlins for breach of contract,

statutory fraud, misrepresentation, violation of Texas Property Code Subchapter D,

and quantum meruit. At the bench trial, Stansbury testified that Irvine hired him to

make several improvements to the house, including building a deck, screening in a

porch, framing a bathroom, and installing a dumbwaiter. He explained that these

improvements were not necessary for the structure of the house, but were made

because Irvine wanted to improve the house and make it nicer. According to

Stansbury, he received payments for his work directly from Irvine. Stansbury was

also under the impression that Irvine had bought the house from the Gatlins.

Gatlin testified that she drew up the handwritten document reflecting the sale

of the house that she and Irvine signed. She explained that she received, and

cashed, several checks from Irvine, but that Irvine stopped making payments for

several months and, therefore, the later checks she received were rent payments,

not payments toward the purchase price of the house. Gatlin also testified that

Irvine made certain improvements to the house while he was living there, but that

3 those improvements were not necessary. She explained that she and her husband

moved back into the house after Irvine’s death and that she collected insurance

proceeds on the house after it was destroyed by Hurricane Ike.

At the conclusion of the bench trial, the trial court determined that if there

was an enforceable contract for deed, it was breached by Irvine’s failure to make

consistent payments. Additionally, the court found that Irvine made improvements

to the property, which increased its value, and that Gatlin benefited from those

improvements while living there and through the collection of insurance proceeds

after the house was destroyed in Hurricane Ike. The court also found that:

(1) Moore is the proper representative of Irvine’s estate and has standing to bring

this lawsuit; (2) Moore’s claims for breach of contract and rescission are not

supported by evidence and the issue of whether the alleged contract violates the

Statute of Frauds is moot; (3) Gatlin testified that Irvine was a renter with no

rights; however, the handwritten document indicates that Irvine thought he was

purchasing the property and the evidence shows that Irvine’s payments to Gatlin

totaled $47,350; (4) Gatlin signed the handwritten document and that fostered a

mistaken belief that Irvine had greater interest in the property than that of a renter;

and (5) reasonably believing he was purchasing the property, Irvine made and paid

for significant improvements to the house exceeding $22,527.89, and Gatlin

wrongfully benefitted from those improvements.

4 According to the trial court, Moore was entitled to recover based on the

equitable theory of quantum meruit because Irvine was led to believe that he

possessed a greater interest in the property than that of a renter and Gatlin

encouraged that belief. Acting on that belief, Irvine made significant repairs to the

property in excess of $22,527.89. Therefore, the court entered judgment for Moore

in that amount. Gatlin appeals.

Discussion

A. Standing

Before we reach the merits, we consider Gatlin’s contention that Moore

lacks standing to bring this claim. Standing is a component of subject matter

jurisdiction. Tex. Ass’n of Bus. v. Tex. Air Control Bd., 852 S.W.2d 440, 445 (Tex.

1993). Subject-matter jurisdiction is a question of law and subject to de novo

review. Tex. Dept. of Parks & Wildlife v. Miranda, 133 S.W.3d 217, 226 (Tex.

2004).

A plaintiff has standing when she is personally aggrieved by the alleged

wrong. Stephens v. City of Houston, 260 S.W.3d 163, 167 (Tex. App.—Houston

[1st Dist.] 2008, no pet.). Generally, a suit to recover estate property may be

brought only by a personal representative. Shepherd v. Ledford, 962 S.W.2d 28,

31 (Tex. 1998). Citing no authority, Gatlin contends that Moore lacked standing to

bring this suit because she failed to identify any claim to the Crystal Beach house

5 in the Louisiana probate proceedings. However, it is undisputed that Moore was

the representative of Irvine’s estate. Therefore, Moore had standing to sue in that

capacity for the recovery of any property belonging to Irvine’s estate. See Frazier

v. Wynn, 472 S.W.2d 750, 752 (Tex. 1971) (finding that general rule that personal

representative of estate of decedent is ordinarily only person entitled to sue for

recovery of property belonging to estate applies to suits to recover damages for

breach of contract entered into by decedent during his lifetime); see also TEX.

PROB. CODE ANN. § 233A (West 2008) (administrators may institute “[s]uits for

the recovery of personal property, debts, or damages and suits for title or

possession of lands or for any right attached to or growing out of the same or for

injury or damage done thereto.”). We conclude that Moore, having been named

representative of Irvine’s estate, had standing to bring this suit. See Frazier, 472

S.W.2d at 752; see also TEX. PROB. CODE ANN. § 233A.

We overrule Gatlin’s second point of error.

B. Quantum Meruit

In her first point of error, Gatlin contends there is no evidence or,

alternatively, insufficient evidence to support an award for quantum meruit.

1. Standard of Review

In an appeal from a bench trial, the trial court’s findings of fact have the

same weight as a jury verdict. Catalina v. Blasdel, 881 S.W.2d 295, 297 (Tex.

6 1994); Nguyen v. Yovan, 317 S.W.3d 261, 269–70 (Tex. App.—Houston [1st Dist.]

2009, pet. denied). We review a trial court’s findings of fact under the same legal

and factual sufficiency of the evidence standards used when determining whether

sufficient evidence exists to support an answer to a jury question. Catalina, 881

S.W.3d at 297; Nguyen, 317 S.W.3d at 270.

We consider the legal sufficiency of the evidence in the light most favorable

to the prevailing party, according every reasonable inference in that party’s favor

and disregarding contrary evidence unless a reasonable factfinder could not do so.

See Tricon Tool & Supply, Inc. v. Thumann, 226 S.W.3d 494, 500–01 (Tex.

App.—Houston [1st Dist.] 2006, pet. denied); see also City of Keller v. Wilson,

168 S.W.3d 802, 827 (Tex. 2005). “If there is any evidence of probative force to

support the finding, i.e., more than a mere scintilla, we will overrule the issue.”

City of Houston v. Hildebrandt, 265 S.W.3d 22, 27 (Tex. App.—Houston [1st

Dist.] 2008, pet. denied) (citing Haggar Clothing Co. v. Hernandez, 164 S.W.3d

386, 388 (Tex. 2005)).

All the evidence must be considered when reviewing a factual sufficiency

complaint. Lofton v. Texas Brine Corp., 720 S.W.2d 804, 805 (Tex. 1986). The

verdict should be set aside only if it is so contrary to the overwhelming weight of

the evidence that it is clearly wrong and unjust. Cain v. Bain, 709 S.W.2d 175,

176 (Tex. 1986). We cannot “substitute our opinion for that of the trier of fact

7 merely because we might have reached a different conclusion.” Glockzin v. Rhea,

760 S.W.2d 665, 666 (Tex. App.—Houston [1st Dist.] 1988, writ denied).

2. Analysis

Quantum meruit is an equitable remedy generally available when there is no

express contract covering the services or materials furnished. See Fulgham v.

Fischer, 349 S.W.3d 153, 159 (Tex. App.—Dallas 2011, no pet.) (citing Truly v.

Austin, 744 S.W.2d 934, 936 (Tex. 1988)). This remedy “is based upon the

promise implied by law for beneficial services rendered and knowingly accepted.”

Vrott Exploration Co., Inc. v. Chevron U.S.A., Inc., 787 S.W.2d 942, 944 (Tex.

1990) (quoting Truly, 744 S.W.2d at 936). Recovery in quantum meruit prevents

unjust enrichment to the party who benefited from the work. Pepi Corp. v.

Galliford, 254 S.W.3d 457, 465 (Tex. App.—Houston [1st Dist.] 2007, pet.

denied). To recover under quantum meruit, the plaintiff must prove:

(1) that valuable services were rendered or materials were furnished; (2) for the person sought to be charged; (3) which services and materials were accepted by the person sought to be charged, used and enjoyed by him; (4) under such circumstances as reasonably notified the person sought to be charged that the plaintiff, in performing such services, was expecting to be paid by the person sought to be charged.

Id.

Gatlin does not dispute that Irvine made improvements to the house, but

contends the evidence is legally and factually insufficient to support the judgment

because the improvements were made for the sole benefit of Irvine (not for her), 8 and because Irvine did not expect Gatlin to pay him for the improvements. We

disagree.

Irvine made and paid for improvements to the house beginning in 2005,

when Irvine believed he had bought the house from Gatlin. Gatlin acknowledged

originally agreeing to sell the house to Irvine, and she acknowledged accepting

more than half of the purchase price of the house. But Gatlin testified that Irvine

later breached the agreement by failing to make payments toward the principal as

agreed, and thus become a tenant whose subsequent payments to Gatlin were for

rent only. There was no evidence that Irvine believed he was merely a renter. The

record thus supports the trial court’s findings that Irvine paid for improvements to

the house reasonably believing he owned the house, and that Gatlin fostered

Irvine’s belief that his interest in the house was more than that of a tenant. We

conclude this evidence is sufficient to support the trial court’s implied finding that

the improvements were made under circumstances that notified Gatlin that she

would be expected to pay for the improvements. See Campbell v. Northwestern

Nat’l Life Ins. Co., 573 S.W.2d 496, 498 (Tex. 1978) (upholding quantum meruit

claim and damages for reasonable value of services rendered where plaintiff made

improvements to apartment complex with expectation that he would be given

option to purchase apartment complex).

9 The evidence is also sufficient to support the third element—acceptance,

use, and enjoyment by the person sought to be charged. It is undisputed that Gatlin

used and enjoyed the improvements by asserting ownership of and moving back

into the improved house after Irvine’s death. Gatlin also collected the insurance

proceeds on the house, as improved by Irvine, after it was destroyed in Hurricane

Ike.

In sum, we conclude there is more than a scintilla of evidence that Gatlin

accepted, enjoyed, and benefitted from the improvements, and that the

circumstances were such that Gatlin was reasonably notified that Irvine, whose

status changed from owner to tenant, would expect to be compensated for these

improvements. See Haggar Clothing Co., 164 S.W.3d at 388. Having considered

all of the evidence, we likewise conclude that the trial court’s finding that Moore

was entitled to recover under quantum meruit is no so contrary to the

overwhelming weight of the evidence that it is clearly wrong and unjust. See Cain,

709 S.W.2d at 176.

We overrule Gatlin’s first point of error.

C. Damages

In her third point of error, Gatlin contends that the trial court erred by

admitting testimony regarding Irvine’s checks as evidence of economic damages.

Gatlin objected to testimony regarding Moore’s economic damage model on the

10 basis that Moore failed to disclose the evidence in response to a request for

disclosure.

A party may request disclosure of the amount and any method of calculating

economic damages. TEX. R. CIV. P. 194.2(d); Harris County v. Inter Nos, Ltd., 199

S.W.3d 363, 367 (Tex. App.—Houston [1st Dist.] 2006, no pet.). Rule 193.6(a) of

the Texas Rules of Civil Procedure states:

A party who fails to make, amend, or supplement a discovery response in a timely manner may not introduce in evidence the material or information that was not timely disclosed, or offer the testimony of a witness (other than a named party) who was not timely identified, unless the court finds that: (1) there was good cause for the failure to timely make, amend, or supplement the discovery response; or (2) the failure to timely make, amend, or supplement the discovery response will not unfairly surprise or unfairly prejudice the other parties.

TEX. R. CIV. P. 193.6(a). A party’s failure to provide complete responses to

discovery results in automatic exclusion of the evidence, unless the trial court finds

good cause or lack of unfair surprise or prejudice. See Dyer v. Cotton, 333 S.W.3d

703, 717 (Tex. App.—Houston [1st Dist.] 2010, no pet.); Norfolk S. Ry. Co. v.

Bailey, 92 S.W.3d 577, 581 (Tex. App.—Austin 2002, no pet.). The burden of

establishing good cause, lack of unfair surprise, or lack of unfair prejudice is on the

party seeking to introduce the evidence or call the witness. TEX. R. CIV. P.

193.6(b); Dyer, 333 S.W.3d at 717. The trial court has discretion in determining

11 whether good cause or lack of unfair surprise exists, but such a finding must be

supported by the record. TEX. R. CIV. P. 193.6(b); Dyer, 333 S.W.3d at 717.

Here, Moore’s petition reflects that she sought a “. . . full refund of all . . .

the costs of improvements to the property . . . .” And Moore produced copies of

Irvine’s checks which reflected amounts Irvine paid for those improvements. We

conclude this was sufficient to provide notice to Gatlin of the amount for which

Moore would seek reimbursement for the improvements. See Marin v. IESI TX

Corp., 317 S.W.3d 314, 323 (Tex. App.—Houston [1st Dist.] 2010, pet. denied)

(affirming trial court’s admission of accounting summary of fees incurred during

investigation based on finding of no unfair surprise, even though summary was not

timely disclosed, where plaintiff’s petition specifically sought damages based on

costs of investigation into and correction of false accounting entries); Williams v.

County of Dallas, 194 S.W.3d 29, 33 (Tex. App.—Dallas 2006, pet. denied)

(affirming trial court’s admission of delinquent tax statement based on lack of

unfair surprise, even though taxing unit did not disclose tax statement in response

to request for disclosure, because original petition gave notice that lawsuit included

all claims for taxes currently delinquent and those becoming delinquent on

property after lawsuit was filed); see also MeGehee v. Campbell, No. 01-08-1023-

CV, 2010 WL 1241300, at *4 (Tex. App.—Houston [1st Dist.] March 25, 2010, no

pet.) (mem. op.) (upholding award of damages in partition case, where appellant

12 contended discovery responses were not sufficient to give notice of claimed

damages, because appellee specifically stated in response that he sought damages

for wrongful exclusion from property and alleged reasonable value of rent). We

conclude the trial court did not abuse its discretion by admitting Moore’s damages

evidence based on its finding that Gatlin was not unfairly surprised.

We overrule Gatlin’s third point of error.

Conclusion

We affirm the trial court’s judgment.

Rebeca Huddle Justice

Panel consists of Chief Justice Radack and Justices Bland and Huddle.