K.W. Ministries, Inc. v. Auction Credit Enterprises, LLC

Opinion

ACCEPTED

05-14-01392-CV

FIFTH COURT OF APPEALS

DALLAS, TEXAS 4/8/2015 6:56:26 PM

LISA MATZ

CLERK

No. 05-14-01392-CV

FILED IN

5th COURT OF APPEALS

In the Court of Appeals for the Fifth Judicial District of Texas at Dallas DALLAS, TEXAS

4/8/2015 6:56:26 PM

LISA MATZ

Clerk

K.W. MINISTRIES, INC.,

Plaintiff-Appellant,

v.

AUCTION CREDIT ENTERPRISES, LLC,

Defendant-Appellee

__________________________________________________________________

On appeal from the 116th Judicial District Court for Dallas County, Texas Hon. Tonya Parker presiding

__________________________________________________________________

BRIEF OF APPELLEE

AUCTION CREDIT ENTERPRISES, LLC

__________________________________________________________________

Robert K. Wise State Bar No. 21812700 bwise@lwsattorneys.com LILLARD WISE SZYGENDA PLLC 5949 Sherry Lane, Suite 1255 Dallas, Texas 75225 214 • 739 • 2000 Telephone 214 • 739 • 2010 Fax

TABLE OF CONTENTS

TABLE OF CONTENTS ........................................................................................... 1

INDEX OF AUTHORITIES...................................................................................... 3

STATEMENT OF THE CASE .................................................................................. 7

STATEMENT REGARDING ORAL ARGUMENT ............................................... 8 STATEMENT OF FACTS ........................................................................................ 9

A. The Parties. .................................................................................................... 10

B. KWM And ACE Enter Into A Floor-Plan Financing Agreement. ................ 13

C. KWM Defaults Under The Agreement. ........................................................ 16 D. ACE Reports KWM’s Default To Auction Insurance Agency (AIA). .......... 17

E. KWM Sues ACE. ........................................................................................... 19 F. KWM Sues ACE Again. ................................................................................ 19

SUMMARY OF ARGUMENT ............................................................................... 30

ARGUMENT ........................................................................................................... 32 A. The Trial Court Did Not Abuse Its Discretion In Failing To Consider The Amended Response................................................................. 32 1. The standard of review. ....................................................................... 32

2. The trial court did not abuse its discretion by not considering the Amended Response. ...................................................................... 32 a. Texas Rule of Civil Procedure 166a(c) expressly requires leave of court to file a summary-judgment response or summary-judgment evidence late. ......................... 33

b. The relation-back doctrine is inapplicable to a summary-judgment response. ................................................... 38 B. The Summary Judgment Must Be Affirmed For Multiple Reasons. ............ 40

2

1. The summary-judgment standard. ....................................................... 40

2. Both the no-evidence and traditional summary judgment must be affirmed. ................................................................................. 42

PRAYER .................................................................................................................. 47

CERTIFICATE OF COMPLIANCE WITH RULE 9.4 .......................................... 49 CERTIFICATE OF SERVICE ................................................................................ 49

3

INDEX OF AUTHORITIES

CASES Allison v. Post-Newsweek Stations Houston LP, Nos. 01-10-00775-CV, 01-11-00767-CV, 2011 Tex. App. LEXIS 10158 (Tex. App.— Houston [1st Dist.] Dec. 22, 2011, no pet.) (mem. op.) ................................36 Arellano v. Magana, 315 S.W.3d 576 (Tex. App.—El Paso 2010) ........................47

Baylor Health Care System v. Maxtech Hldgs., Inc., 111 S.W.3d 654 (Tex. App.—Dallas 2003, no pet.) ................................................................47

Benchmark Bank v. Crowder, 919 S.W.2d 657 (Tex. 1996) ............................ 28, 34

Brown v. Melissa 121/5 Partners, Ltd., No. 05-13-01189-CV, 2014 Tex. App. LEXIS 8467 (Tex. App.—Dallas Aug. 4, 2014, no pet.) (mem. op.) ................................................................. 32, 34, 37

Brown v. Tex. Bd. of Nurse Exam’rs, 194 S.W.3d 721 (Tex. App.—

Dallas 2006, no pet.) ......................................................................................47 Burbage v. Burbage, 447 S.W.3d 249 (Tex. 2014) .................................................43

Carpenter v. Cimarron Hydrocarbons Corp., 98 S.W.3d 682 (Tex. 2002) ................................................................................. 32, 33, 34, 37

Centeq Realty, Inc. v. Siegler, 899 S.W.3d 195 (Tex. 1995) ...................................41 Elliot-Williams Co. v. Diaz, 9 S.W.3d 801 (Tex. 1999) ..........................................40

Forbes, Inc. v. Granada Biosciences, Inc., 124 S.W.3d 167 (Tex. 2003)...............40 Godfrey v. Sec. Serv. Fed. Credit Union, 356 S.W.3d 720 (Tex. App El Paso 2011, no pet.) ....................................................................................37

Helitrans Co. v. Rotorcraft Leasing Co. 2015 Tex. App. LEXIS 1410 (Tex. App.—Houston [1st Dist.] Feb. 12, 2015, no pet. h.) ..........................46

Johnson & Johnson Med., Inc. v. Sanchez, 924 S.W.2d 925 (Tex. 1996) ..............41 Karcher v. Classic Foods, L.P., 2005 Tex. App. LEXIS 3062 (Tex. App.—Fort Worth Apr. 21, 2005, no pet.) ................................... 40, 41

4

Ketter v. ESC Med. Sys., Inc., 169 S.W.3d 791 (Tex. App.—Dallas 2005, no pet.) ...........................................................................................................41

In re K.W. Ministries, Inc. d/b/a CRUSH Auto Sales, No. 05-13-0085-CV, Memorandum Op. (Jan. 28, 2013) .................................................................19

Laidlaw Waste System, Inc. v. City of Wilmer, 904 S.W.2d 656 (Tex. 1995) ...........9 Lone Star Partners v. NationsBank Corp., 893 S.W.2d 593 (Tex. App.—

Texarkana 1994, no writ)...............................................................................39 Mackey v. Great Lakes Investments, Inc., 255 S.W.3d 243 (Tex.

App.—San Antonio 2008, pet. denied) ...........................................................9

Malcomson Road Utility Dist. v. Newsom, 171 S.W.3d 257 (Tex. App.—

Houston [1st Dist.] 2005, pet. denied) ...........................................................40 Miller v. Argumaniz, 2015 Tex. App. LEXIS 1274 (Tex. App.—El Paso Feb. 11, 2015, no pet. h.) (mem. op.) ............................................................39 PNS Stores, Inc. v. Rivera, 335 S.W.3d 265 (Tex. App.—San Antonio 2010), rev’d on other grounds, 379 S.W.3d 267 (Tex. 2012) ................ 35, 36

Rhone-Poulenc, Inc. v. Steel, 997 S.W. 2d 217 (Tex. 1999) ...................................41

Santillan v. Nat’l Union Fire Ins. Co., 166 S.W.3d 823 (Tex. App.—

El Paso 2005, no pet.) ....................................................................................47 In re S.A.P., 156 S.W.3d 574 (Tex. 2005) ...............................................................39

Star-Telegram, Inc. v. Doe, 915 S.W.2d 471 (Tex. 1995).......................................41 Sterling v. Alexander, 99 S.W.3d 793 (Tex. App.—Houston [14th Dist.]

2003, pet. denied) ..........................................................................................47 Swett v. At Sign, Inc., No. 2-08-315-CV, 2009 Tex. App. LEXIS 3579 (Tex. App.—Fort Worth May 21, 2009, no pet.) (mem. op.) .......................37

Tarrant Restoration v. Tex Arlington Oaks Apts., Ltd., 225 S.W.3d 721 (Tex. App.—Dallas 2007, no pet.) ......................................................... 40, 41

Tenneco, Inc. v. Enter. Prods. Co., 925 S.W.2d 640 (Tex. 1996), rev’d on other grounds, 379 S.W.3d 267 (Tex. 2012) ..................................35

5

Univ. of Tex. Health Science Ctr. v. Bailey, 332 S.W.3d 395 (Tex. 2011) .............39

Valence Operating Co. v. Dorsett, 164 S.W.3d 656 (Tex. 2005)..................... 40, 41

Wawarosky v. Fast Grp. Houston Inc., No. 01-13-00466-CV, 2015 Tex.

App. LEXIS 1522 (Tex. App.—Houston [1st Dist.] Feb. 17, 2015, no pet. h.) (mem. op.) ................................................................................9, 37

STATUTES AND RULES Texas Business & Commerce Code § 17.45(5) .........................................................7 Texas Business & Commerce Code § 17.46(b) .........................................................7

Texas Business & Commerce Code § 17.46(b)(8), .................................................20 Texas Business & Commerce Code §17.46(b)(12) .................................................20 Texas Business & Commerce Code §17.46(b)(24) .................................................20

Texas Business & Commerce Code § 17.49(f)................................................. 21, 23

Texas Business & Commerce Code § 17.50(a) .......................................................23 Texas Business & Commerce Code § 17.50(a)(1) ....................................................7

Texas Business & Commerce Code § 17.50(a)(1)(A) .............................................23

Texas Business & Commerce Code § 17.50(a)(3) ....................................................7 Texas Business & Commerce Code § 17.565................................................... 21, 23

Texas Civil Practice & Remedies Code § 16.068................................. 31, 33, 37, 39

Texas Rule of Appellate Procedure 38.1(d)...............................................................9 Texas Rule of Appellate Procedure 38.1(i) .............................................................32

Texas Rule of Appellate Procedure 44.1(a) (1) .......................................................37

Texas Rule of Civil Procedure 45(a) .......................................................................39

Texas Rule of Civil Procedure 166a(c)................................................. 25, 31, 33, 34 Texas Rule of Civil Procedure 166a(i) ....................................................................42

6

OTHER AUTHORITIES Judge David Hitner & Lynne Liberato, Summary Judgments in Texas:

State and Federal Practice, 46 Houston L. Rev. 1379 (2010)...................... 34

7

STATEMENT OF THE CASE1

This action arises out of a “Demand Promissory Note and Security

Agreement” (the Agreement) pursuant to which Appellant K.W. Ministries, Inc.

(KWM) obtained floor-plan financing from Appellee Auction Credit Enterprises,

LLC (ACE) for the purchase of vehicles by KWM’s former used-car business.2

KWM’s “Original Petition” (the Petition) alleged five causes of action:

(1) defamation, (2) false, misleading or deceptive acts or practices in violation of

Sections 17.46(b) and 17.50(a)(1) of the Texas Deceptive Trade Practices Act (the

DTPA),3 (3) unconscionable actions or courses of action in violation of Sections

17.45(5) and 17.50(a)(3) of the DTPA,4 (4) fraud, and (5) breach of contract (i.e.,

the Agreement).5

ACE moved for a no-evidence and traditional summary judgment on each

cause of action and a traditional summary judgment on certain of its affirmative

1 The “Clerk’s Record” will be cited “CR” followed by the relevant page(s) and a parenthetical identifying the cited document (e.g., CR7-13 (Pet.)). The “Reporter’s Record” will be cited as “RR” followed by the relevant page(s) and line(s) (e.g., “RR __:_.”).

The pages of KWM’s Brief are not numbered. So that ACE can refer to specific pages of it, Exhibit A hereto is a copy of the Brief on which handwritten page numbers have been written. Citations to the Brief’s pages are to the interlineated ones on Exhibit A.

2 CR5, 23 (Orig. Pet. ¶ 6 & Exh. A (the Agreement)).

3 Tex. Bus. & Com. Code §§ 17.46(b), 17.50(a)(1).

4 Id. §§ 17.45(5), 17.50(a)(3).

5 CR7-20 (Orig. Pet.).

8

defenses.6 The Court granted the motion, entering a final summary judgment that

did not specify the grounds on which it was granted.7 KWM timely appealed.8

STATEMENT REGARDING ORAL ARGUMENT Oral argument should not be granted in this appeal because the appeal is

frivolous. As discussed below, KWM’s brief (the Brief or Br.) does not comply

with Texas Rule of Appellate Procedure 38 and does not raise any appellate issues

because its arguments are not clear and concise and generally fail to cite relevant

legal authorities or the record. For example, even though the trial court granted a

no-evidence summary judgment, the Brief not only fails to identify the elements of

each cause of action challenged by the summary-judgment motion, but, even

worse, fails to identify any specific evidence raising a fact issue with respect to

each challenged element. The Brief also fails to mention each affirmative defense

on which the traditional summary judgment was granted.

KWM’s argument that the trial court “erred when it failed to consider

[KWM’s] amended [summary-judgment] response”9 ignores the proper standard of

review and is frivolous because (1) it is contrary to Texas Rule of Civil Procedure

166a(c)’s express language, and (2) is based on the relation-back doctrine—a

6 CR69 (Am. MSJ).

7 CR600 (Final Summary Judg.).

8 CR602 (Notice of Appeal).

9 Br. “Argument” § II, at 17.

9

doctrine relating to limitations and pleadings and not to summary-judgment

responses.

ACE needlessly was forced to waste tens of thousands of dollars defeating

KWM’s meritless claims in the trial court and in preparing this brief, it should not

be forced to waste thousands of dollars more on oral argument in a frivolous

appeal.

STATEMENT OF FACTS

Even though Texas Rule of Appellate Practice 38.1(d) required the Brief’s

“Statement of Facts” to be “supported by record references,” the statement is a

mere regurgitation of the Petition’s “Statement of Facts” with minor

modifications.10 In fact, every “record reference” in the statement is to the

Petition. As this is an appeal from a summary judgment and as pleadings are not

proper summary-judgment evidence,11 the Statement of Facts is unsupported by

any such evidence.12 Moreover, many of the factual assertions in the Statement of

10 Compare Br. Statement of Facts (6-15) with Pet. ¶¶ 7-20 (CR6-11).

11 E.g., Laidlaw Waste Sys., Inc. v. City of Wilmer, 904 S.W.2d 656, 660 (Tex. 1995)

(“Generally, pleadings are not competent evidence, even if sworn or verified”). Although the Petition contained a number of exhibits, they also are not proper summary-judgment evidence because “[d]ocuments submitted as summary judgment proof must be sworn to or certified. ‘Unauthenticated or unsworn documents, or documents not supported by any affidavit, are not entitled to consideration as summary judgment evidence.’” Wawarosky v. Fast Grp. Houston, Inc., No. 01-13-0446-CV, 2015 Tex. App. LEXIS 1522 (Tex. App.—Houston [1st Dist.] Feb. 17, 2015, no pet. h.) (mem. op.) (quoting Mackey v. Great Lakes Invests., Inc., 255 S.W.3d 243, 252 (Tex. App.—San Antonio 2008, pet. denied)).

12 As discussed below, the trial court granted ACE’s amended summary-judgment motion. CR69-406. KWM’s original response to the motion was unaccompanied by any

10

Facts are not supported by citations to the Petition, presumably because the

Petition does not support them.13

Because there is no summary-judgment evidence supporting KWM’s

version of the facts and because the material facts set forth in the Brief’s

“Statement of Facts” are untrue, ACE takes issue with every such fact in it and

below sets forth an accurate statement of facts based on the uncontroverted

summary-judgment evidence.

A. The Parties.

KWM is a Texas not-for-profit corporation that purports to operate a

ministry.14 It is owned and operated by Kenneth Williams (Williams), a self-

summary-judgment evidence. CR407-24. Although KWM filed an amended response on the day of the summary-judgment hearing containing summary-judgment evidence, the trial court denied KWM’s oral request at the hearing for leave to file it, CR600 (Final Summ. Judg.), and the Statement of Facts does not cite that evidence. In fact, that evidence is not even cited in the Brief’s arguments. See Br. “Argument” §§ III-IV, at 19-21. Rather, KWM simply refers the Court to portions of the amended response. Id.

13 See, e.g., Br. at 8 (“At the outset of their relationship, and at all times thereafter, Defendant instructed Plaintiff to make payment checks payable to “AAA” and not to [ACE]. Not knowing the reason or justification for this request, Plaintiff nonetheless complied with Defendant’s instructions.”), 10 (“On November 17, 2011, Defendant finally provided Plaintiff with a copy of the Contract. Over three (3) months had passed from the time the Contract was signed until Defendant finally gave Plaintiff a copy of the Contract.”), 14 (“Defendant confirmed this balance due by handing the written statement of its Chief Operating Officer, Tedd Martin to Plaintiff in a meeting on December 22, 2011.”), 15 (“Defendant finally paid Plaintiff its over- collection on proceeds of collateral in early May, 2012, almost six (6) months after it terminated its loan relationship with Plaintiff, four and one half (4½) months from the date of its last meeting with Plaintiff and over three and one half (3½) months after its last sale of any vehicles.”).

14 CR150 (Am. MSJ at 82 (Williams Depo. at 7)).

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proclaimed minister.15 KWM, during its more than six years in existence,16 has

never filed a federal-income tax return and maintains no contemporaneous

accounting or financial records for any of its businesses and does not even

maintain copies of all of its bank statements.17

In addition to its “ministry,” KWM currently is in the home-remodeling

business and formerly was in the used-car business.18 The latter business, which is

the subject of this action, operated under the name “C.R.U.S.H. Auto Sales.”19

KWM began selling used vehicles in May 201020 at a used-car lot located on

East Lancaster in Fort Worth, Texas.21 In or about December 2011, it moved its

used-car lot to a location on South East Loop 820 in Fort Worth after learning that

the person from whom it was leasing the East Lancaster location did not own it and

15 The exact nature of KWM’s ministry is unclear. CR150-51 (Am. MSJ at 82-83 (Williams Depo. at 7-8)). It is, however, clear that Williams, KWM’s guiding force, has a checkered past with jobs running the gambit from mechanic to day-care owner to home- remodeling franchisee to pastor and has had run-ins both with the law and his creditors. CR163- 67 (Am. MSJ at 95-99 (Williams Depo. at 23-25, 88-90, 95-99)).

16 CR152 (Am. MSJ 84 (Williams Depo. at 9)).

17 CR172-74 (Am. MSJ at 104-106 (Williams Depo. at 108-10)).

18 CR184-55 (Am. MSJ at 86-87 (Williams Depo. at 14-15)).

19 CR153-54, 159 (Am. MSJ at 85-86, 91 (Williams Depo. at 13-14, 26)).

20 CR212, 159 (Am. MSJ at 144 (Sewell Depo. at 22), 91 (Williams Depo. at 26)).

21 CR213 (Am. MSJ at 145 (Sewell Depo. at 26)).

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that it was not zoned for use as a used-car lot.22 KWM’s small inventory of used

vehicles was purchased at used-car and salvage auctions.23

ACE provides, among other things, floor-plan financing for used car

dealers.24 Floor-plan financing provides a car dealer with a revolving credit line to

finance vehicle purchases.25

ACE’s typical floor-plan financing plan provides for a 56-day “Advance”

(or loan) for the vehicle’s purchase price. An Advance generally must be paid the

earlier of when it is due or immediately upon the vehicle’s sale, together with a

floor-plan fee, interest, and a dealer-reserve fee.26 If the vehicle does not sell

within the Advance’s 56-day term, ACE, in the exercise of its sole discretion and

upon the dealer’s request, can make an “Extension” on the Advance for another 28

22 CR213-15 (Am. MSJ. at 145-47 (Sewell Depo. at 26-28)).

23 CR216 (Am. MSJ at 148 (Sewell Depo. at 30)).

24 CR280 (Am. MSJ at 212 (Valdes Aff. ¶ 2)).

25 Id.

26 CR133, 145, 280-91 (Am. MSJ at 65, 77 (Agr. § 2.3(e) and Term Sheet), 212-23 (Valdes Aff. ¶ 3)). Section 2.3(e) of the Agreement provides that “Dealer shall pay all Obligations . . . with respect to Lender-Financed Inventory on the earlier of: (a) twenty-four (24) hours from the time Dealer receives payment by or on behalf of the purchasers of an item of Lender-Financed Inventory, (b) forty-eight (48) hours after the disposition by sale or otherwise of an item of Lender-Financed Inventory, (c) the Maturity Date [of an Advance] or (d) upon demand by Lender.” CR133 (Am. MSJ at 65).

The “dealer-reserve fee” is a fee charged on each Advance and is placed in a “Reserve Account.” The account’s purpose is to provide ACE with additional security for the dealer’s performance under the Agreement. CR140, 329 (Am. MSJ at 72 (Agr. § 12.12); 261 (Valdes Supp. Aff. ¶ 4)). Any excess funds from the sale of repossessed vehicles after a dealer’s default also are placed in the Reserve Account. CR329 (Am. MSJ at 261 (Valdes Supp. Aff. ¶ 4)).

13

days.27 When an Extension is granted, the dealer must repay at least 20 percent of

the Advance’s outstanding principal amount as well as interest and a floor-plan

fee.28 Like an Advance, an Extension generally must be repaid the earlier of when

it is due or immediately upon the vehicle’s sale.29

B. KWM And ACE Enter Into A Floor-Plan Financing Agreement.

In August 2011, Joe Madrid (Madrid), ACE’s Irving, Texas, Branch

Manager, met with Williams and KWM’s “general counsel,” Yolonda Sewell

(Sewell), about ACE’s floor-plan financing program.30 Williams told Madrid that

KWM and he had poor credit and that he wanted to upgrade KWM’s used-car

inventory by using floor-plan financing to purchase newer and better quality used

vehicles.31

As required by ACE, Williams filled out a credit application.32

Unbeknownst to ACE, the application was rife with lies. For example, it

misrepresented the amount of time in which KWM had been in the used-car

27 CR281 (Am. MSJ at 213 (Valdes Aff. ¶ 4)).

28 Id.

29 CR133, 281 (Am. MSJ 65 (Agr. § 2.3(e), 213 (Valdes Aff. ¶ 4)).

30 CR128-29 (Am. MSJ at 60-61 (Madrid Aff. ¶ 3)).

31 Id.

32 CR242-43 (Am. MSJ at 174-75 (Sewell Depo. Exh. 4 (Credit Application)).

14

business and its average monthly vehicle sales.33 ACE would never have approved

KWM’s application had it known that any of the information on the credit

application was false.34

Williams also told Madrid that KWM was willing to give ACE titles to

certain vehicles that it owned outright as collateral for floor-plan loans.35 ACE

would not have agreed to provide floor-plan financing to KWM had KWM not

agreed to do this.36 In fact, ACE often requires dealers with poor credit histories,

such as KWM, to provide such titles as collateral.37

On August 11, 2011, KWM signed a floor-plan financing agreement with

ACE (i.e., the Agreement),38 which provided a $75,000 floor-plan revolving credit

line for vehicle purchases.39 The Agreement was signed at ACE’s Irving, Texas,

office by Williams. Because Williams always has Sewell review KWM’s

33 Williams represented in the application that that KWM had been a dealer for “2+”

years and that it had been operating at the East Lancaster location for that period of time, when, in fact, KWM had began operating only for about fifteen months. CR242, 183-84 (Am. MSJ at 174 (Sewell Depo. Exh. 4), 115-16 (Williams Depo. at 141-42)). Worse, he represented in the application that KWM averaged fifteen vehicle sales per month, when it had never sold more than thirteen vehicles in a month and only averaged six sales per month. CR312 (Am. MSJ at 244 (Reynolds Aff. Exh. C)).

34 CR326 (Am. MSJ at 258 (Supp. Madrid Aff. ¶ 5)).

35 CR128-29 (Am. MSJ at 60-61 (Madrid Aff. ¶ 3)).

36 CR129, 333-34 (Am. MSJ at 61 (Madrid Aff. ¶ 4); 265-66 (Supp. Valdes Aff. ¶ 21)).

37 CR129, 333-34 (Am. MSJ at 61 (Madrid Aff. ¶ 4); 265-66 (Supp. Valdes Aff. ¶ 21)).

38 CR128, 133-45 (Am. MSJ at 60, 65-77 (Madrid Aff. ¶ 2 & Exh. A)).

39 Id.; see also CR281-82 (Am. MSJ at 212-13 (Valdes Aff. ¶ 3)).

15

contracts before he signs them, he brought Sewell with him to ACE’s office.40

Curiously, however, Sewell reviewed only part of the Agreement before Williams

signed it.41 And, Williams, who claimed that he had questions about certain of its

provisions, including its provisions regarding Extensions, never bothered to discuss

them with Sewell, Madrid, or any other ACE employee before signing the

Agreement.42

Under the Agreement, the decision whether to make an Advance to KWM

for the purchase of a vehicle, as well as the decision to make an Extension, was

within ACE’s sole discretion.43 Likewise, KWM had no obligation to finance its

used-car purchases through ACE.44 Under the Agreement, ACE also had the right,

for any or no reason, to call all of KWM’s “Obligations” (i.e., outstanding

Advances and Extensions) at any time (i.e., on “demand”).45 To ensure the full and

40 CR168-69, 220-21 (Am. MSJ at 100-01 (Williams Depo. at 72-73), 152-53 (Sewell Depo. at 40-41)).

41 CR168-69, 221-22 (Am. MSJ at 100-01 (Williams Depo. at 72-73), 153-54 (Sewell Depo. at 41-42)).

42 CR169-70 (Am. MSJ at 101-02 (Williams Depo. at 73-74)).

43 See CR133 (Am. MSJ at 65 (Agr. §§ 2.3(a) (“The decision to make an Advance to Dealer is the exclusive right of Lender, and Dealer understands and agrees that Lender may refuse to make an Advance at any time, with or without cause and without prior notice to Dealer . . . .” (emphasis added)), 2.3(f) (“If Dealer is in compliance with all other provisions of this Agreement, Lender may, in its sole discretion, permit an Extension of the Maturity Date relative to an item of Lender-Financed Inventory . . . .” (emphasis added))).

44 CR133 (Am. MSJ (Agr. §§ 2.3(a) and 2.3(f))).

45 CR133 (Am. MSJ (Agr. § 2.3(e))).

16

prompt payment of Advances and Extensions under the Agreement, KWM gave

ACE a security interest in, among other things, all of its vehicles and other

property, and not merely in those vehicles financed by ACE. 46

C. KWM Defaults Under The Agreement.

Shortly after entering into the Agreement, the parties’ relationship soured

because (1) KWM’s checks began bouncing, (2) KWM sold vehicles “out-of-trust”

(i.e., selling vehicles without immediately repaying the Advance or Extension

relating to it), and (3) KWM failed to repay Advances at all.47 On November 16,

2011, as permitted by the Agreement, ACE demanded full payment of all

outstanding amounts due and owing under the Agreement (i.e., all Advances and

Extensions) and further advised KWM that it would no longer make Advances or

Extensions to KWM.48 ACE also repossessed a number of vehicles whose titles

were in its possession. It, however, refrained from immediately selling those

46 CR133-34 (Am. MSJ at 66-67 (Agr. § 3.1)).

47 CR129-30, 246, 247, 255, 275-79 (Am. MSJ at 61-62 (Madrid Aff. ¶¶ 8-9), 178 (Sewell Depo. Exh. 11 (November 8, 2011 Madrid email asking when KWM would pay past due on Advances), 179 (Sewell Depo. Exh. 12 (November 15, 2011 Madrid email noting that KWM was past due on six Advances)), 187 (Sewell Depo. Exh. 19 (November 18, 2011 Madrid letter noting that KWM had sold six vehicles out-of-trust)), 207-11 (Sewell Depo. Exhs. 28-29 (NSF checks in the amounts of $9,940 and $6,780))).

48 CR248-50 (Am. MSJ at 180-82 (Sewell Depo. Exh. 13 (11/21/11 Williams letter))).

ACE properly demanded full payment of KWM’s indebtedness and properly declined to make future Advances or Extensions because the decision to make Advances or Extensions was solely in ACE’s discretion, see CR133 (Am. MSJ at 65 (Agr. §§ 2.1, 2.3(f))), and because the Advances were demand loans, id. (Agr. § 2.3(e) (requiring KWM to pay all “Obligations” on “demand”)).

17

vehicles at auction because KWM repeatedly promised to repay its indebtedness

under the Agreement promptly.49 After KWM failed to honor its promises, ACE

sold five of the vehicles through independent and well-attended automobile

auctions and applied the sales proceeds to KWM’s indebtedness under the

Agreement, all as permitted by the Agreement.50 ACE then refunded $4,723 to

KWM, which was the balance of KWM’s Reserve Account.51

D. ACE Reports KWM’s Default To Auction Insurance Agency (AIA).

AIA is an insurer that, among other things, insures automobile auctions

against NSF checks and other payment defaults by dealers who purchase vehicles

at their auctions.52 It is affiliated with AutoTec LLC and AuctionACCESS, a

dealer registration system that provides memberships to car dealers, which, in turn,

allows the member-dealers to purchase vehicles at certain automobile auctions.53

KWM became an AuctionACCESS member in about May 2010.54

On November 18, 2011, ACE informed Sam Compton (Compton), an AIA

Recovery and Loss Prevention Agent, that KWM had given ACE an NSF check 49 CR244-45, 251-54, 256-74 (Am. MSJ at 176-77, 183-86, 188-206 (Sewell Depo. Exhs.

10, 17, 18, 20, 21, 22, 24, 25, 26)).

50 CR130, 138-39 (Am. MSJ at 62, 70-71 (Madrid Aff. ¶¶ 10-11, Agr. §§ 11.3, 11.9).

51 CR282, 289-91, 330-31, 336-38 (Am. MSJ at 214, 221-23 (Valdes Aff. ¶ 8 & Exhs. C-

D); 262-63, 268-70 (Supp. Valdes Aff. ¶¶ 12-13 & Exhs. A-B)).

52 CR292 (Am. MSJ at 224 (Compton Aff. ¶ 2)).

53 CR294 (Am. MSJ at 226 (Dukes Aff. ¶ 2)).

54 CR295 (Am. MSJ at 227 (Dukes Aff. ¶ 3)).

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and had defaulted on its floor-plan credit line.55 AIA subsequently informed its

insured auctions that no further coverage would be provided under its insurance

policies with respect to KWM’s checks for the purchase of vehicles at their

auctions.56

Compton contacted Williams on November 22, 2011, to inform him about

ACE’s report. He also told Williams how KWM could have its checks once again

covered by AIA’s insurance policies, which, in turn, would have allowed it to

purchase vehicles at certain auctions.57 Williams was uninterested in having KWM

reinstated by AIA.58

Later in November 2011, KWM allegedly was told by an auction that it

could not purchase vehicles at auction because of ACE’s report to AIA.59

Thereafter, KWM never again attempted to buy vehicles at an auction60 or made

any effort to be reinstated by AIA, as Compton told Williams it could be.61

55 CR293 (Am. MSJ at 225 (Compton Aff. ¶ 4)).

56 Id.

57 Id.

58 Id. (Am. MSJ at 225 (Compton Aff. ¶ 5)).

59 CR216-17, 226-28, 230-31, 189-96 (Am. MSJ at 148-49, 158-60, 162-63 (Sewell Depo. at 30-31, 146-48, 152-53), 121-28 (Williams Depo. at 199-206)).

60 CR218-19 (Am. MSJ at 150-51 (Sewell Depo. at 32-33)).

61 CR293 (Am. MSJ at 225 (Compton Aff. ¶ 5)).

19

E. KWM Sues ACE.

On May 7, 2012, KWM sued ACE (the 2012 Action), asserting claims for

the Agreement’s breach, fraud, and defamation.62 Because KWM was represented

by Sewell, who was a critical fact witness regarding the Agreement’s execution

and KWM’s dealings with ACE, ACE moved to disqualify her from acting as

KWM’s trial attorney in the action.63 On October 17, 2012, the trial court granted

ACE’s motion and ordered KWM to obtain new trial counsel within thirty days.64

After KWM failed to do so, the Court dismissed the 2012 Action without

prejudice.65

F. KWM Sues ACE Again.

On December 12, 2013, more than a year after the 2012 Action was

dismissed, KWM filed this action. It asserted the same contract, fraud, and

defamation claims asserted in the 2012 Action.66 In addition, it asserted DTPA

claims.67 Specifically, KWM alleged that ACE:

62 CR90 (Am. MSJ at 22).

63 Id.

64 Id. Notwithstanding her disqualification and this Court’s denial of KWM’s mandamus petition regarding it, see In re K.W. Ministries, Inc. d/b/a CRUSH Auto Sales, No. 05-13-0085- CV, Memorandum Op. (Jan. 28, 2013), Sewell is KWM’s lead attorney in this appeal.

65 CR90 (Am. MSJ at 22).

66 CR11-18 (Pet. ¶¶ 21-51).

67 CR18-20 (Pet. ¶¶ 52-64).

20

 breached the Agreement by (1) charging greater than permitted NSFcheck fees, (2) requiring KWM to make payments with “certified funds” after it gave ACE two NSF checks, (3) failing to grant Extensions under the Agreement, (4) foreclosing on two vehicles after they allegedly had been sold by KWM, (5) charging for multiple lot checks, (6) repossessing vehicles that had more than “double the value” of KWM’s indebtedness to ACE, (7) repossessing vehicles after KWM defaulted on the Agreement instead of exercising its rights against KWM’s bond, (8) failing to return any excess proceeds from the sale of the repossessed/seized vehicles and/or KWM’s reserve account to KWM after the parties’ relationship ended, and (9) failing to provide an accounting;68

 defrauded KWM into entering into the Agreement by misrepresenting that KWM had to provide the titles to certain vehicles as collateral to obtain floor-plan financing;69

 defamed KWM when ACE “published a statement by oral communication and conduct to AIA asserting as fact that [KWM] did not pay its bills [sic] that [KWM] owed [ACE] money when it did not;”70

 engaged in false, misleading, and deceptive acts or practices in violation of DTPA §§ 17.46(b)(8), (12), and (24)71 “when [ACE] informed [KWM] that relinquishment of titles to four high-end vehicles was necessary to obtain floor-plan financing” (i.e., the same alleged misrepresentation underlying the fraud claim);72 and

 engaged in five unconscionable actions or courses of action in violation of the DTPA: (1) demanding and obtaining free and clear 68 CR11-14, 314-15 (Pet. ¶¶ 21-31); Am. MSJ at 246-47 (KWM’s Sec. Am. Resp. to Interrog. 2).

69 CR14 (Pet. at ¶ 33); see also CR318 (Am. MSJ at 250 (KWM’s Sec. Am. Resp. to Interrog. 3), 117-19 (Williams Depo. at 156-58), 161 (Sewell Depo. at 150)).

70 CR16 (Pet. at ¶ 44).

71 Tex. Bus. & Comm. Code §§ 17.46(b)(8), (12), (24).

72 CR320 (Am. MSJ at 252 (KWM’s Sec. Am. Resp. to Interrog. 4)).

21

certificates of title that were unnecessary for floor-plan financing, (2) failing to provide an accounting, (3) failing to return excess proceeds, (4) charging fees for vehicles that were never repossessed/seized by ACE, and (5) repossessing/seizing vehicles under retail-installment contracts.73

Even though KWM’s credit line was only $75,000 and its relationship with

ACE lasted only about three months during which it floor-planned only ten

vehicles, KWM claimed that it suffered hundreds of thousands of dollars in

economic damages from ACE’s alleged wrongdoing.74

ACE’s “Answer,” in addition to generally denying KWM’s

allegations, asserted the following affirmative defenses, among others:

....

5. Plaintiff’s defamation claim is barred (a) because any alleged defamatory statements were true, (b) because any alleged defamatory statements were privileged, and (c) by the one-year limitations period applicable to defamation claims,

6. Plaintiff’s DTPA claims are barred (1) because the transaction is exempt under Section 17.49(f) of the DTPA, Tex. Bus. & Comm. Code § 17.49(f), and (b) by the two-year limitations period of Section 17.565 of the DTPA,

. . . . .75

On July 8, 2014, ACE filed a traditional summary-judgment motion on all of

KWM’s claims and certain of ACE’s affirmative defenses.76 The motion was set

73 CR322 (Am. MSJ at 254 (KWM’s Sec. Am. Resp. to Interrog. 5)).

74 E.g., CR316 (Am. MSJ at 248 (KWM’s Sec. Am. Resp. to Interrog. 2)).

75 CR67 (Ans. at 2 (citations omitted)).

22

for hearing on Friday, August 8, 2014.77 A few days before the hearing, KWM

filed a slew of motions in an effort to delay it, including motions to compel

discovery and for a continuance.78 As a result, ACE agreed to continue the

summary-judgment hearing until Monday, September 15, 2014.79

ACE filed an amended summary-judgment motion on August 25, 2014 (the

Amended MSJ). It was identical to the original motion except that it also sought a

no-evidence summary judgment on each of KWM’s claims.80 Specifically, the

Amended MSJ argued the following:

 The Defamation Claim. ACE was entitled to a traditional summary judgment on the claim because (1) it was barred by the one-year limitations period for defamation claims, (2) the alleged defamatory statements were true, (3) the alleged defamatory statements were subject to a qualified privilege, and/or (4) KWM failed to mitigate its damages. ACE also was entitled to a no-evidence summary judgment on the defamation claim because there was no evidence establishing that KWM was damaged by the alleged defamatory statements and/or the dollar amount of the damages.81

 The DTPA Claim for False, Misleading, or Deceptive Acts or Practices. ACE was entitled to a traditional summary judgment on the claim because (1) the alleged representation (i.e., the vehicle titles had to be provided as security to obtain floor-plan financing) does not

76 CR612, 614 (Docket Sheet at 4,6).

77 See RR33-34; CR612, 614 (Docket Sheet at 4, 6).

78 CR612 (Docket Sheet at 4).

79 CR614 (Docket Sheet at 6).

80 CR66 (Am. MSJ).

81 CR77, 93-97, 125-26 (Am. MSJ at 9, 25-29, 57-58).

23

constitute a laundry-list violation as required by DTPA § 17.50(a)(1)(A),82 (2) the representation was true—ACE would not have extended floor-plan financing to KWM without the titles, (3) the representation was not a producing cause of KWM’s economic damages as KWM was able to sell the vehicles at any time even though ACE held their titles as collateral and, in any event, the Agreement gave ACE a security interest in the vehicles (and all of KWM’s used-car business’s other assets), (4) the claim was barred by the DTPA’s two-year limitations period,83 (5) the claim was barred by the DTPA’s exemption for claims arising out of written contracts involving more than $100,000,84 and/or (6) KWM failed to mitigate its damages. ACE also was entitled to a no-evidence summary judgment on the DTPA claim because there was no evidence establishing that (a) there was a laundry-list violation as required by DTPA §17.50(a)(1)(A), (b) the violation was a producing cause of KWM’s economic damages as required by DTPA §17.50(a),85 (c) KWM was damaged by the alleged false, misleading, or deceptive act or practice, and/or (d) the dollar amount of the DTPA damages.86

 The DTPA Claim for Unconscionable Actions or Courses of Action. ACE was entitled to a traditional summary judgment on the claim because (1) none of the actions underlying it constitute an unconscionable action or course of action within the DTPA’s meaning, (2) the claim was barred by the DTPA’s two-year limitation period, (3) the claim was barred by the DTPA’s exemption for claims arising out of written contracts involving more than $100,000, and/or (4) KWM failed to mitigate its damages. ACE also was entitled to a no-evidence summary judgment on the DTPA claim because there was no evidence establishing (a) that any of the alleged wrongful acts constitute an unconscionable action or course of action within the DTPA’s meaning, (b) that any of the alleged unconscionable actions or courses of action were a producing cause of KWM’s economic 82 Tex. Bus. & Comm. Code § 17.50(a)(1)(A).

83 Id. § 17.565.

84 Id. § 17.49(f).

85 Id. § 17.50(a).

86 CR77-78, 97-103, 125-26 (Am. MSJ at 9-10, 29-35, 57-58).

24

damages, (c) that KWM was damaged by the alleged unconscionable actions or courses of action, and/or (d) the dollar amount of KWM’s DTPA damages.87

 The Fraud Claim. ACE was entitled to a traditional summary judgment on the claim, which was based on the same alleged misrepresentation underlying KWM’s DTPA claim for false, misleading, or deceptive acts or practices (i.e., ACE’s alleged representation to KWM that, to obtain floor-plan financing, KWM had to give ACE, as collateral, titles to certain vehicles that it owned outright), because (1) the representation was true—ACE would not have extended floor-plan financing to KWM without the titles, (2) KWM was not damaged by the alleged fraud as KWM was able to sell the vehicles at any time even though ACE held their titles as security and, in any event, the Agreement gave ACE a security interest in the vehicles, and/or (3) KWM failed to mitigate its damages. ACE also was entitled to a no-evidence summary judgment on the fraud claim because there is no evidence establishing (a) that the representation was false, (b) that KWM was damaged by it, and/or (c) the dollar amount of KWM’s fraud damages.88

 The Contract Claim. ACE was entitled to a traditional summary judgment on the contract claim because (1) each of the alleged breaches either did not occur or did not violate the Agreement’s provisions, and/or (2) KWM failed to mitigate its damages. ACE also was entitled to a no-evidence summary judgment on the contract claim because there was no evidence establishing (a) that ACE breached the Agreement, (b) that KWM was damaged by the alleged breaches, and/or (c) the dollar amount of the contract damages.89

87 CR78-79, 104-10, 125-26 (Am. MSJ at 10-11, 36-42, 57-58).

88 CR79-80, 111-13, 125-26 (Am. MSJ at 11-12, 43-45, 57-58).

89 CR80-81, 113-26 (Am. MSJ at 11-13, 45-58).

25

On September 8, 2014, the last day to timely file a response to the amended

summary-judgment motion,90 KWM filed one (the Original Response).91 The

Original Response, which was unaccompanied by any summary-judgment

evidence, addressed only one of KWM’s five claims—the defamation claim,

arguing that it was not barred by limitations and that the allegedly defamatory

statements were not subject to a qualified privilege.92 It also argued that ACE’s

summary affidavits (i.e., the Madrid, Valdes, and Reynolds affidavits) should not

be considered for a number of bogus reasons.93 Curiously, the Original Response

wholly ignored ACE’s request for a no-evidence summary judgment, failing to

direct the trial court to any evidence creating a fact issue with respect to any of

elements of KWM’s claims challenged by the Amended MSJ.94

In addition to the Original Response, KWM, in a bad faith attempt to delay

the summary-judgment hearing and its day of reckoning further, again filed

90 Tex. R. Civ. P. 166a(c) (providing that a summary judgment response must be filed “not later than seven days prior to the hearing”); Br. “Argument” § II, at 17 (admitting that KWM’s “response was due on or before September 8, 2015 [sic]”).

91 CR407 (Orig. Resp.).

92 CR415-18 (Orig. Resp. at 9-12).

93 CR419-23 (Orig. Resp. at 13-17). KWM also filed a motion to strike the affidavits primarily because they were undated. RR27-28. The motion, which is not in the appellate record, was denied by the trial court. CR600 (Final Summary Judg. (“the Court hereby . . . denies Plaintiff’s motions”)). More importantly, KWM has waived any error regarding the affidavits because the Brief does not mention them.

94 CR407 (Orig. Resp.).

26

motions to compel and for continuance,95 neither of which are part of the appellate

record and only one of which, the continuance motion, was set for hearing.96

As evidenced from the summary-judgment hearing transcript, the motion to

compel falsely claimed that ACE had failed to provide complete information about

other lawsuits by its customers alleging fraud, DTPA, or defamation claims,97

whereas the continuance motion sought a continuance of the summary-judgment

hearing so that KWM could investigate the facts surrounding the other lawsuits

and not because it needed additional time to respond to the Amended MSJ’s

arguments or to obtain affidavits or other evidence to support its claims or contest

ACE’s affirmative defenses.98

Perhaps most importantly, not only had KWM thoroughly questioned

Madrid about the “other lawsuits” during his deposition,99 but the trial court also

recognized, and KWM’s attorney even admitted, that the lawsuits were irrelevant

to the issues raised by the Amended MSJ:

THE COURT: . . . I did want to give you the opportunity to try to help the Court understand what the discovery is that you claim you’ve been diligent in trying to pursue, notwithstanding that

95 See RR4-27 (discussing the motions); CR613 (Docket Sheet at 3).

96 RR8:1-7; CR613 (Docket Sheet at 3).

97 RR4-27.

98 Id.

99 RR16-19.

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diligence you haven’t gotten, and it limits your ability to respond to the motion for summary judgment.

I have to be honest with you, Mr. Leslie, I don’t entirely understand the answers to all of those questions. You have told me about a lot of things that, to Mr. Wise’s point and in fairness, they are not in the record that’s in front of me on the motion for continuance ....

But even if I were to . . . consider what you have said . . ., there still is this hole in this respect, two things: One, I still haven’t heard on what issue related to this summary judgment these lawsuits . . . would provide any type of evidence that you think is relevant to your being able to respond to the motion for summary judgment; but the second issue . . . is that as it relates to the DTPA claims, the defamation claim, the DTPA laundry list and the unconscionable conduct claims, the motions [sic] posit legal grounds for the Court to dispose of those claims, arguably things that you could respond to without any additional evidence . . . . And I don’t know, frankly, what evidence you would need to be able to respond to some of the legal arguments that are made.

.....

. . . I haven’t heard about anything related to these other lawsuits that these other lawsuits that has to do with your ability to respond to those legal arguments, yet you filed a response that doesn’t cite any authority or attach any evidence which you have the ability to get. Your client’s affidavit. Your client is here. He has been here. He was here at the last proceeding. You have the ability to get his affidavit on different points. So you have that. And so I don’t really understand why you haven’t been able to respond to both the legal arguments and even the argument of truth being a defense.

So tell me . . .—what these lawsuits have to do with that, those aspects of the defamation claim.

MR. LESLIE: On the issue of limitations, Your Honor, the lawsuits don’t have anything to do with it. . . .

....

28

THE COURT: What do the lawsuits have to do with responding to the argument about the limitations argument and the exemption arguments [i.e., DTPA § Section 17.49(f), Tex. Bus. & Comm. Code § 17.49(f)]?

MR. LESLIE: Nothing.

THE COURT: And as it relates to . . . the [DTPA] laundry list [violations], . . . the lawsuits obviously don’t bear on that.

MR. LESLIE: No, your honor.100

ACE promptly filed a reply to the Original Response debunking its minimal

arguments.101 On Friday, September 12, 2014, the last business day before the

summary-judgment hearing, KWM filed a “Document Supplement” to the Original

Response, which contained some unsworn and unauthenticated documents and

excerpts from Williams’ and Madrid’s deposition transcripts.102 The Document

Supplement was unaccompanied by a motion seeking leave to file it late.103

100 RR21:9-22:17, 23:2-18, 25:16-25 (emphasis added). The trial court denied the continuance motion, CR600 (Final Summary Judg. (“the Court hereby . . . denies Plaintiff’s motions”)), and, more importantly, KWM has waived any appellate issue regarding it because it is not mentioned in the Brief.

101 CR425 (Reply Br.).

102 CR459 (Doc. Supp.).

103 The trial court never entered an order allowing KWM to file the Document Supplement and KWM does not complain about this failure in the Brief. Of course, absent such an order, the evidence was not properly before the trial court. Benchmark Bank v. Crowder, 919 S.W.2d 657, 663 (Tex. 1996) (“There is no order in this record granting the Crowders leave to file McCool’s affidavit late. McCool’s affidavit was not properly before the trial court on the motions for summary judgment.”).

29

Finally, on the morning of the hearing, KWM filed an amended summary-

judgment response,104 which was accompanied by Sewell’s affidavit, which related

solely to the defamation claim, some unsworn and unauthenticated documents, and

excerpts from Williams’, Sewell’s, and Madrid’s deposition transcripts105

(collectively with the amended response, the “Amended Response”). As was the

case with the Document Supplement, the Amended Response was unaccompanied

by a motion seeking leave to file it. The Amended Response was received by

ACE’s attorneys as they were leaving for the summary-judgment hearing and was

not received by the trial court before the hearing began.106

At the summary-judgment hearing, KWM’s attorney asked the trial court to

“receive my oral motion for leave to amend and accept our response to the

summary judgment motion that was filed this morning.”107 When asked point

blank by the trial court why the Amended Response had not been filed timely,

KWM’s attorney had no explanation:

104 CR483.

105 CR521-99.

106 RR23:18-21 (“MR. LESLIE: . . . We filed an amended response this morning. THE COURT: I’m not aware of any amended response.”), 34:21-25 (“[MR. WISE:] . . . This morning at 11:30 as Ms. Fayne and I were leaving to . . . come to court, I got an e-mail from the court system saying he filed something. My paralegal printed it out and we read it sitting out in the hallway.”).

107 RR33:8-11.

30

Mr. LESLIE: That is addressed in the amended response.

There’s the affidavit of Ms. Sewell, who has been previously identified as a fact witness in this case, with which I agreed.

The COURT: So tell me why you—Ms. Sewell has been here.

She’s been here before you were here. Why would I not have an affidavit to support the response when it was due versus the morning of the proceeding . . . ?

Mr. LESLIE: I don’t have a satisfactory answer for that, Your Honor.108

The trial court denied KWM’s oral request for leave to file the Amended

Response late.109

SUMMARY OF ARGUMENT

KWM first claims that the trial court “erred” in not considering the

Amended Response in ruling on the Amended MSJ because (1) a trial court must

consider any response and evidence on file before the summary-judgment hearing

irrespective of when it was filed, and (2) under Section 16.068 of the Texas Civil

Practice & Remedies Code, the Amended Response’s filing related back to the

filing of the timely Original Response. Both arguments are frivolous.

108 RR24:3-13 (emphasis added). Later during the hearing, KWM’s attorney complained that ACE filed the Amended MSJ at the last possible minute, id. at 30:6-16, 31:2-7, and “that’s not a lot of time for us to respond to a whole new set of summary judgment arguments[,]” id. at 31:2-7. Nonetheless, when the trial court asked him if KWM’s key witnesses, Williams and Sewell, were unavailable between the filing of the Amended MSJ and the September 8, 2014 deadline to respond to it, he candidly admitted they were available. Id. at 30:17-20 (“THE COURT: Is there some record in front of me that Ms. Sewell and Mr. Williams have not been available to you between the 26th of August and the 8th of September? MR. LESLIE: There is not.”).

109 CR600 (Final Summary Judg. (“the Court hereby . . . denies Plaintiff’s oral request at the September 15, 2015 hearing for leave to file its amended summary judgment response”)).

31

Texas Rule of Civil Procedure 166a(c) expressly provides that “leave of

court” is required to file a summary-judgment response or summary-judgment

evidence, such as the Amended Response, less than seven days before the hearing.

Here, KWM never sought such leave and, even if it had, there was no good cause

for its failure to timely file the Amended Response.

Section 16.068 of the Texas Civil Practice and Remedies Code, by its

express terms, only applies to pleadings and pleas of limitation. A summary

judgment response is neither a pleading nor relates to limitations. Accordingly, the

trial court did not abuse its discretion in failing to consider the Amended Response.

KWM’s second and third arguments are that the trial court erred in granting

either a no-evidence or traditional summary judgment. The arguments fail for two

reasons. First, as even KWM implicitly concedes, the Original Response was

wholly inadequate to defeat summary judgment. Because KWM’s arguments are

based on the Amended Response and because the trial court did not abuse its

discretion in failing to consider it, the summary judgment must be affirmed.

Second, even if the trial court abused its discretion in not considering the

Amended Response, the Brief’s arguments are wholly conclusory, fail to address

each no-evidence and traditional summary judgment ground, fail to cite any

authorities, and fail to direct the court to the summary-judgment evidence raising a

fact issue on even the two claims and one defense mentioned in passing in the

32

Brief. Thus, they fail to comply with Texas Rule of Appellate Procedure 38.1(i)

and are inadequate. Accordingly, the summary judgment must be affirmed.

ARGUMENT

A. The Trial Court Did Not Abuse Its Discretion In Failing To Consider The Amended Response.

1. The standard of review. An appellate court “reviews a trial court’s ruling on a motion for leave to file

a summary-judgment response or summary-judgment evidence late for an abuse of

discretion.”110 A trial court “abuses its discretion when it acts without reference to

any guiding rules or principles.”111

2. The trial court did not abuse its discretion by not considering the Amended Response.

KWM claims that the trial court “erred” in failing to consider the Amended

Response for two reasons.112 Initially, claiming that Texas Rule of Civil Procedure

166a(c) requires a trial court to consider any response or evidence on file at the

time of the summary-judgment hearing irrespective of when it was filed, KWM

concludes that the trial court was required to consider the Amended Response

110 Carpenter v. Cimarron Hydrocarbons Corp., 98 S.W.3d 682, 686 (Tex. 2002); accord Brown v. Melissa 121/5 Partners, Ltd., No. 05-13-01189-CV, 2014 Tex. App. LEXIS 8467, at *3 (Tex. App.—Dallas Aug. 4, 2014, no pet.) (mem. op.).

111 Carpenter, 98 S.W.3d at 687; accord Brown, 2014 Tex. App. LEXIS 8467, at *3.

112 Br. “Argument” § II, at 17-19.

33

because it was filed on the morning of the hearing.113 Next, it argues that, since the

Original Response was timely filed, the Amended Response also was timely filed

because, under Section 16.068 of the Texas Civil Practice and Remedies Code, the

Amended Response’s filing relates back to the Original Response’s filing.114 Both

arguments are frivolous.

a. Texas Rule of Civil Procedure 166a(c) expressly requires leave of court to file a summary-judgment response or summary-judgment evidence late.

KWM’s argument that Rule 166a(c) required the trial court to consider any

response or evidence filed before the summary-judgment hearing ignores the

Rule’s express language, which requires leave of court for the filing of a summary-

judgment response or summary-judgment evidence late: “Except on leave of court,

the adverse party, not later than seven days prior to the day of hearing may file and

serve opposing affidavits or other written response.”115

Unsurprisingly, given Rule 166a(c)’s clear language, the Texas Supreme

Court and this Court repeatedly have held that the Rule requires leave of court for

such late filings.116 As recently explained by this Court:

113 Id.

114 Id. at 18-19.

115 Tex. R. Civ. P. 166a(c) (emphasis added).

116 Carpenter, 98 S.W.3d at 686 (“Our summary judgment rules afford a party in this situation an opportunity to obtain additional time to file a response, either by moving for leave to file a late response or by requesting a continuance of the summary-judgment hearing.” (citing

34

In a summary judgment proceeding, the nonmoving party may file and serve opposing affidavits or other written responses no later than seven days prior to the scheduled date of the hearing. The nonmoving party must obtain leave to file evidence after the deadline. A motion for leave to file a late summary judgment response should be granted when the nonmovant establishes good cause by showing that the failure to timely respond (1) was not intentional or the result of conscious indifference but the result of accident or mistake and (2) allowing the late response will not cause any undue delay or otherwise injure the party seeking summary judgment.117

KWM wholly ignored the good-cause standard in the trial court. The

Amended Response was unaccompanied by a motion for leave and an affidavit

explaining why its late filing was not intentional or the result of conscious

indifference or why it would not cause undue delay or otherwise injure ACE. And,

at the summary-judgment hearing, KWM’s attorney did not mention either prong

of the standard.118 Similarly, the Brief also ignores the good-cause standard.

It, however, is clear that neither prong of the standard was met here.

Initially, KWM’s failure to timely file the Amended Response was intentional or

the result of conscious indifference as evidenced by the fact that it filed a frivolous

continuance motion that falsely claimed that ACE had failed to provide discovery

Tex. R. Civ. P. 166a); Benchmark Bank v. Crowder, 919 S.W.2d 657, 663 (Tex. 1996) (“Summary judgment evidence may be filed late, but only with leave of court.” (citing Tex. R. Civ. P. 166a(c)); Brown, 2014 Tex. App. LEXIS 8467, at *3 (“The nonmoving party must obtain leave to file evidence after the deadline.”); Judge David Hitner & Lynne Liberato, Summary Judgments in Texas: State and Federal Practice, 46 Houston L. Rev. 1379, 1406, 1423 (2010) (pointing out that leave of court is required to file a summary-judgment response or summary- judgment evidence late).

117 Brown, 2014 Tex. App. LEXIS 8467, at *3; accord Carpenter, 98 S.W.3d 688.

118 See RR29-36.

35

about matters—other lawsuits—that (1) KWM had already had full and complete

discovery about, and (2) were wholly irrelevant to any issue raised by the

Amended MSJ and, therefore, did not preclude KWM from responding to the

Amended Motion fully in a timely manner.119 Of course, a failure to file a proper

continuance motion shows intent or conscious indifference.120

Perhaps more importantly, KWM offered no evidence about what steps, if

any, it took to obtain timely the allegedly needed discovery so as to establish that it

was not acting intentionally or with conscious indifference.121 To the contrary, as

its lawyer candidly admitted at the summary-judgment hearing, there was no

excuse for its failure to file the Sewell Affidavit on time and it was uncontroverted

that (1) KWM had unfettered access to its principal witnesses, Sewell and

Williams, at all times, and (2) the documents and deposition-transcript excerpts

attached to the Amended Response had been in its attorney’s possession long

119 See discussion supra notes 97-100.

120 See Tenneco, Inc. v. Enter. Prods. Co., 925 S.W.2d 640, 647 (Tex. 1996) (holding that a nonmovant who needs additional evidence to prepare a summary-judgment response must properly request a continuance), rev’d on other grounds, 379 S.W.3d 267 (Tex. 2012); PNS Stores, Inc. v. Rivera, 335 S.W.3d 265, 284 (Tex. App.—San Antonio 2010), rev’d on other grounds, 379 S.W.3d 267 (Tex. 2012) (same).

121 It was evident that KWM made no effort to obtain any evidence about the other lawsuits (or anything else) after the Madrid deposition. E.g., RR16:21-18:8 (discussing the fact that ACE obtained an affidavit from one of the lawyers in one of the “other lawsuits” explaining the lawsuit’s nature).

36

before the September 8, 2014 deadline to file a timely summary-judgment

response.122

Not only is the first good-cause element not established, but it also is clear

that had the trial court granted KWM leave to file the Amended Response late,

ACE would have been greatly prejudiced. As pointed out above, the Amended

Response was not filed until the morning of the summary-judgment hearing, was

received by ACE’s attorneys as they left for the hearing, and was not received by

the trial court before the hearing. Thus, the granting of leave to file the Amended

Response necessarily would have required the Court to postpone the summary-

judgment hearing so that it could consider the response and so that ACE could

reply to it. This, in turn, would have resulted in undue delay—a delay of both the

summary-judgment hearing, which already had been rescheduled once because of

KWM’s shenanigans, and the entry of summary judgment. The granting of leave

also would have caused ACE to incur considerable additional attorneys’ fees

122 See discussion supra notes 99-103, 106. See also PNS Stores, 335 S.W.3d at 284 (“Moreover, there is no evidence about what steps, if any, PNS took to obtain the documents before its response was due so as to establish it was not acting intentionally or with conscious indifference.); Allison v. Post-Newsweek Stations Houston LP, Nos. 01-10-00775-CV, 01-11- 00767-CV, 2011 Tex. App. LEXIS 10158, at *12 (Tex. App.—Houston [1st Dist.] Dec. 22, 2011, no pet.) (mem. op.) (“Dorinda presented no evidence to show that her failure to respond was not intentional or the result of conscious indifference. There is only the bare assertion in her affidavit that she did not receive the notice, which is insufficient to show a lack of intent or conscious indifference. There is no evidence that the notice was delivered to an incorrect address or that Loase was unauthorized to receive mail at Dorinda’s place of business. Nor is there evidence of any other accident or mistake. Accordingly, we cannot say that the trial court abused its discretion in denying Dorinda’s motion for new trial to allow her to file a late response to the motion for summary judgment.” (citation omitted)).

37

because all the time spent preparing for the summary-judgment hearing on

September 15, 2014, would have been wasted and ACE would have been forced to

spend thousands of dollars more in attorneys’ fees preparing a second reply brief

(it had already replied to the original response) and preparing for another

summary-judgment hearing.

In Brown v. Melissa 121/5 Partners, Ltd., this Court recently held, on

similar facts, that there was sufficient prejudice to negate the second good-cause

element:

[E]ven assuming his unverified arguments established the first Carpenter element, appellant failed to show the late response would not cause any undue delay or otherwise injure appellee. In fact, the motion does not even mention the possibility of delay if the court granted the motion for leave. Appellee, however, specifically argued in its response that it would be prejudiced by a delay because it would delay entry of judgment and cause increased legal fees. Thus, we conclude appellant wholly failed to establish the second Carpenter element-that allowing the late response would not unduly delay or otherwise injure appellee. As such, appellant failed to establish good cause for not timely filing her motion for summary judgment response.123

Finally, it is worth noting that an appellant, such as KWM, who complains

on appeal about the exclusion of summary-judgment evidence, must not only

establish that the trial court abused its discretion in excluding the evidence, but

123 2014 Tex. App. LEXIS 8467, at *3-5 (citation omitted); accord Swett v. At Sign, Inc., No. 2-08-315-CV, 2009 Tex. App. LEXIS 3579, at *5-6 (Tex. App.—Fort Worth May 21, 2009, no pet.) (mem. op.) (holding that the trial court’s denial of leave to file a late summary-judgment response was not an abuse of discretion when neither the unsworn motion nor the attached affidavits discussed the possibility of delay if leave were granted).

38

also that the evidence’s exclusion probably caused the rendition of an improper

judgment.124 Here, KWM merely claims that the trial court “erred” in not

considering the Amended Response. Nothing in the Brief, however, explains how

the exclusion of its late-filed summary-judgment evidence probably resulted in an

improper summary judgment (i.e., why it created a fact issue on any of KWM’s

claims or on ACE’s affirmative defenses). Indeed, the Brief is wholly devoid of

any citation or reference to that evidence. Simply put, KWM has failed to

establish that the trial court’s failure to consider the Amended Response constitutes

reversible error.

b. The relation-back doctrine is inapplicable to a summary-

judgment response.

KWM’s second argument—that the Amended Response, under Section

16.068 of the Texas Civil Practice and Remedies Code, related back to the filing of

the Original Response—is absurd. Initially, as pointed out above, Texas Rule of

Civil Procedure 166a(c) expressly requires “leave of court” for the filing of a

summary-judgment response or summary-judgment evidence late.

124 Wawarosky v. Fast Grp. Houston Inc., N0. 01-13-00466-CV, 2015 Tex. App. LEXIS 1522, at *10 (Tex. App.—Houston [1st Dist.] Feb. 17, 2015, no pet. h.) (mem. op.) (“To reverse a judgment based on a claimed error in admitting or excluding evidence, a party must show that the error probably resulted in an improper judgment.”); Godfrey v. Sec. Serv. Fed. Credit Union, 356 S.W.3d 720, 723 (Tex. App—El Paso 2011, no pet.) (“A party complaining on appeal of the admission or exclusion of evidence must show both that the trial court’s ruling was erroneous and probably caused rendition of an improper judgment.”); Tex. R. App. P. 44.1(a)(1) (“No judgment may be reversed on appeal on the ground that the trial court made an error of law unless the court of appeals concludes that the error complained of: (1) probably caused the rendition of an improper judgment . . . .”).

39

Moreover, Section 16.068, by its express terms, only applies to pleadings

and pleas of limitation:

If a filed pleading relates to a cause of action, cross action, counterclaim, or defense that is not subject to a plea of limitation when the pleading is filed, a subsequent amendment or supplement to the pleading that changes the facts or grounds of liability or defense is not subject to a plea of limitation unless the amendment or supplement is wholly based on a new, distinct, or different transaction or occurrence.125

A summary-judgment response is not a “pleading”126 and does not concern a

“plea of limitation.” In fact, the Texas Supreme Court has made clear that the

relation-back doctrine relates only to limitations defenses: “But narrow or broad,

the purpose of the relation-back doctrine is to determine not when, but on what

limitations runs.”127

In sum, the trial court did not abuse its discretion in refusing to consider the

Amended Response.

125 Tex. Civ. Prac. & Rem. Code § 16.068 (emphasis added).

126 See In re S.A.P., 156 S.W.3d 574, 576 n.3 (Tex. 2005) (“[A] motion for summary judgment is not a pleading.”); Miller v. Argumaniz, 2015 Tex. App. LEXIS 1274, at *5 (Tex. App.—El Paso Feb. 11, 2015, no pet. h.) (mem. op.) (same); Tex. R. Civ. P. 45(a) (“Pleadings in the district and county courts shall (a) be by petition and answer . . . .”).

127 Univ. of Tex. Health Science Ctr. v. Bailey, 332 S.W.3d 395, 400 (Tex. 2011); see Lone Star Partners v. NationsBank Corp., 893 S.W.2d 593, 601 (Tex. App.—Texarkana 1994, no writ) (“When an amended pleading sets up a new cause of action under Section 16.068, it will relate back to the date of the original pleading for the purposes of limitations, so long as the amended pleading does not allege a wholly new, distinct, or different transaction.” (emphasis added)).

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B. The Summary Judgment Must Be Affirmed For Multiple Reasons.

1. The summary-judgment standard. An appellate court reviews a summary judgment de novo.128 The standards

for reviewing no-evidence and traditional summary judgments are well established.

A no-evidence summary judgment is proper if there is no evidence regarding

one or more elements of a cause of action.129 The trial court must grant the motion

unless the nonmovant produces “more than a scintilla of evidence [that] raises a

genuine issue of material fact” on the challenged elements.130 “Less than a scintilla

of evidence exists when the evidence is so weak as to do no more than create a

mere surmise or suspicion of a fact.”131

A defendant is entitled to a traditional summary judgment if the evidence

establishes, as a matter of law, either that at least one element of the plaintiff’s

cause of action cannot be established132 or that each element of an affirmative

128 Valence Operating Co. v. Dorsett, 164 S.W.3d 656, 661 (Tex. 2005); Tarrant Restoration v. Tex. Arlington Oaks Apts., Ltd., 225 S.W.3d 721, 727 (Tex. App.—Dallas 2007, no pet.).

129 Malcomson Rd. Util. Dist. v. Newsom, 171 S.W.3d 257, 262 (Tex. App.—Houston [1st Dist.] 2005, pet. denied).

130 Forbes, Inc. v. Granada Biosciences, Inc., 124 S.W.3d 167, 172 (Tex. 2003);

Malcomson, 171 S.W.3d at 262.

131 Forbes, 124 S.W.3d at 172; Malcomson, 171 S.W.3d at 262.

132 Karcher v. Classic Foods, L.P., 2005 Tex. App. LEXIS 3062, at *3 (Tex. App.—Fort Worth Apr. 21, 2005, no pet.); accord Elliot-Williams Co. v. Diaz, 9 S.W.3d 801, 803 (Tex. 1999).

41

defense has been established.133 Once the defendant produces sufficient evidence

to establish its right to summary judgment, “the burden shifts to the plaintiff to

come forward with competent controverting evidence raising a genuine issue of

material fact with regard to the element challenged by the defendant.”134 And,

“[w]hen reviewing a summary judgment, [the appellate court] accept[s] all

evidence favorable to the nonmovant as true, indulge[s] the nonmovant with every

favorable reasonable inference, and resolve[s] any doubt in the nonmovant’s favor.

The appellate court must affirm the summary judgment if any one of the movant’s

theories has merit.”135

Finally, when, as here, “the trial court’s summary judgment does not specify

the basis for the ruling, [the appellate court] must affirm the judgment if any of the

summary judgment grounds are meritorious. When the appeal does not challenge

one of the grounds for summary judgment, the judgment may be affirmed on that

ground alone.”136

133 Rhone-Poulenc, Inc. v. Steel, 997 S.W. 2d 217, 224 (Tex. 1999); Johnson & Johnson Med., Inc. v. Sanchez, 924 S.W.2d 925, 927 (Tex. 1996).

134 Karcher, 2005 Tex. App. LEXIS 3062, at *3; accord Centeq Realty, Inc. v. Siegler, 899 S.W.3d 195, 197 (Tex. 1995).

135 Valence Operating, 164 S.W.3d at 661; Tarrant Restoration, 225 S.W.3d at 727.

136 Ketter v. ESC Med. Sys., Inc., 169 S.W.3d 791, 797 (Tex. App.—Dallas 2005, no pet.)

(citation omitted); accord Star-Telegram, Inc. v. Doe, 915 S.W.2d 471, 473 (Tex. 1995).

42

2. Both the no-evidence and traditional summary judgment must be affirmed.

The summary judgment must be affirmed for multiple reasons. First, as

KWM implicitly concedes, the Original Response was wholly inadequate to defeat

summary judgment because it failed to address the no-evidence grounds for

summary judgment, wholly failed to contain legal authorities, only partially

addressed only the defamation claim and then only with respect to the traditional

summary-judgment motion, and cited no summary-judgment evidence because it

was unaccompanied by any such evidence.137 Because the trial court did not abuse

its discretion in denying KWM leave to file the Amended Response and because

the Original Response was wholly deficient, both the no-evidence and traditional

summary judgment were properly granted.138

Second, even if the trial court abused its discretion in not considering the

Amended Response, which it did not, the Brief is so inadequate that it does not

raise an appellate issue regarding either the no-evidence or traditional summary

judgment.

137 The Brief does not argue that the Original Response raised a fact issue with respect to ACE’s traditional summary-judgment motion on the defamation claim. Rather, it baldly alleges that the Amended Response raised fact issues with respect to certain claims. Br. “Argument” §§ III, at 20 (“The facts and law outlined in the amended response amount to more than a scintilla of evidence . . . .” (emphasis added)), IV, at 21 ([T]he amended response brings to light both genuine issues of material fact as well as defeats the affirmative defense claimed by [ACE].” (emphasis added)).

138 Tex. R. Civ. P. 166a(i) (“The court must grant the motion unless the respondent produces summary judgment evidence raising a genuine issue of material fact.”).

43

For example, the sum and substance of its argument regarding the no-

evidence summary judgment is that KWM

offered evidence to show that [ACE] breached the agreement by charging excessive insufficient fund fees, by requiring certified funds, by declining curtailments or extensions, by repossessing vehicles under retail installment contract [sic], by charging for multiple lot checks, by selling collateral for less than commercially reasonable values, by failing to proceed against the bond, by failing to timely return excess proceeds, and by failing to provide an accounting. Similarly, [KWM] provided evidence that [ACE] was not entitled to a qualified privilege on the defamation claim. Further, [KWM] introduced evidence of [ACE’s] unconscionable actions as it relates to the [DTPA].139

Each assertion is supported only by citations to the Amended Response and

not by any summary-judgment evidence (either ACE’s or that in the Amended

Response).140 Moreover, the Brief wholly fails to mention the defamation claim,

the fraud claim, or the DTPA claim for false, deceptive, or misleading acts or

practices, much less explain why a fact issue exists on any of the challenged

elements of those claims. Further, even though the Amended Motion sought a no-

evidence summary judgment with respect to each of KWM’s claims on the

grounds that there was no evidence that KWM had been damaged by the alleged

139 Br. “Argument” § III, at 19-20 (footnotes omitted). Because “a qualified privilege” is an affirmative defense, Burbage v. Burbage, 447 S.W.3d 249, 254 (Tex. 2014) (noting that qualified privilege “operates as an affirmative defense in the nature of confession and avoidance”), ACE sought a traditional, and not a no-evidence summary judgment, on it. CR96- 97 (Am. MSJ at 28-29).

140 Br. “Argument” §§ III-IV, at 19-21.

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wrongdoing or, if had been damaged, the dollar amount of its damages,141 the Brief

fails to mention this fact, much less (1) explain, for each cause of action, how

KWM was damaged and the amount of its damages, or (2) cite any evidence

establishing the damages or their amounts.142 Finally, even with respect to the two

causes of action actually referenced in the Brief—the contract claim and the DTPA

claim for unconscionable actions and courses of action—the Brief is woefully

deficient.

For example, with respect the contract claim, the Brief not only fails to cite a

single provision of the Agreement that required or prohibited the alleged breaching

conduct, but more importantly fails to cite any evidence establishing that the

alleged breaching conduct occurred.143 The Brief’s treatment of the DTPA claim

141 See discussion supra notes 80-88.

142 Br. “Argument” § III, at 19-20.

143 Id. The frivolity of KWM’s contract claims is easily demonstrated. For example, one of the alleged Agreement breaches is ACE’s failure to allow Extensions even though, under the Agreement, ACE had absolute discretion to decline to make them. CR133 (Madrid Aff. Exh. A (Agr. § 2.3(f) (“If Dealer is in compliance with all other provisions of this Agreement, Lender may, in its sole discretion, permit an Extension of the Maturity Date relative to an item of Lender-Financed Inventory . . . .” (emphasis added))). Thus, ACE had no obligation to grant KWM any Extension. And, when it refused to grant them, it did so only after KWM had breached the Agreement by providing NSF checks, by selling vehicles out-of-trust, by not paying Advances at all, and by not immediately repaying its indebtedness under the Agreement in full after ACE demanded that it do so on November 16, 2011. CR280-81 (Valdes Aff. ¶ 3).

Another of the alleged breaches is ACE’s repossessing and selling at auction vehicles after KWM defaulted on the Agreement instead of “proceed[ing] against [KWM’s] bond.” Section 11 of Agreement not only provided ACE with many remedies in the event of a default (e.g., including repossession and sale of KWM’s vehicles), but also provided that ACE “may, at its option and without notice exercise any and all of its rights in a separate, successive or concurrent fashion and such exercise of any right shall not preclude pursuit of other rights and

45

for unconscionable acts or courses of action is similarly deficient. Thus, none of

the five allegedly unconscionable actions or courses of action are mentioned, no

cases are cited in support of KWM’s contention that each, in fact, constitutes an

unconscionable action or course of action, and the Brief wholly fails to explain

how each was a producing cause of KWM’s damages.144

The sum and substance of the Brief’s argument regarding the traditional

summary judgment is equally sparse and inadequate: “As stated in argument

section three, the amended response brings to light genuine issues of material fact

as well as the affirmative defense claimed by [ACE]. Namely, [ACE] charged

excessive insufficient fund fees, was not legally entitled to a claim of qualified

privilege, and committed unconscionable actions . . . .”145

remedies at a later time.” CR138 (Madrid Aff. Exh. 1A (Agr. § 11.1 (emphasis added)). Although proceeding against KWM’s bond was one potential remedy for KWM’s default, ACE had no obligation to proceed against it. Accordingly, it did not breach the Agreement by failing to do so.

A third alleged breach is ACE’s alleged failure to provide an accounting. Nothing in the Agreement, however, specifically (or the law generally) required an accounting, CR133-45 (Madrid Aff. Exh. 1A (Agr.), and ACE effectively provided one when it met with Williams and another KWM employee, Fred Darden, on December 22, 2011, and explained the collection/repossession fees charged to KWM and the unpaid balance owed under the Agreement for Advances/Extensions. CR131 (Madrid Aff. ¶ 13); CR326 (Supp. Madrid Aff. ¶ 3).

144 Br. “Argument” § III, at 19-20.

145 Id. “Argument” § IV, at 21.

46

Not a single legal authority is cited regarding the two claims and one defense

mentioned in passing.146 Even worse, the Brief (1) wholly ignores the defamation,

fraud, and DTPA claims for false, misleading, and deceptive acts or practices,

(2) wholly ignores the affirmative defenses to the defamation claim on which ACE

sought summary judgment other than the qualified-privileged defense, (3) wholly

ignores all the affirmative defenses to the DTPA claims on which ACE sought

summary judgment, (4) wholly ignores the fact that a traditional summary

judgment was sought on each claim on the grounds that the evidence established

that KWM had not been damaged by the alleged wrongdoing, and (5) wholly fails

to direct this Court to any evidence in the record on the two claims and one defense

mentioned in the Brief in passing—the contract claim, the DTPA claim for

unconscionable actions or courses of action, and qualified privilege.147

As recently held by the Houston (First District) Court of Appeals:

An appellant’s brief “must contain a clear and concise argument for the contentions made, with appropriate citations to authorities and to the record.” A party asserting error on appeal bears the burden of showing that the record supports the contention raised and of specifying the place in the record where matters upon which it relies or of which it complains are shown. [An appellate court is] not required to sift through a voluminous record without guidance from the appellant to determine whether an assertion of error is valid.148

146 Id. “Argument” § IV, at 20-21.

147 Id.

148 Helitrans Co. v. Rotorcraft Leasing Co. 2015 Tex. App. LEXIS 1410, at *8 (Tex.

App.—Houston [1st Dist.] Feb. 12, 2015, no pet. h.) (quoting Tex. R. App. P. 38.1(i)) (citations

47

Because the Brief’s arguments regarding the summary judgment are

conclusory, fail to address each no-evidence and traditional summary judgment

ground, fail to cite any authorities, and fail to direct the court to any specific

summary-judgment evidence raising a fact issue on even the two claims and one

defense mentioned in passing, they are inadequate and the summary judgment

must be affirmed.149

PRAYER

For the foregoing reasons the summary judgment should be affirmed.

omitted); accord Arellano v. Magana, 315 S.W.3d 576, 577-578 (Tex. App.—El Paso 2010, no pet.); Baylor Health Care Sys. v. Maxtech Hldgs., Inc., 111 S.W.3d 654, 657 (Tex. App.—Dallas 2003, no pet.).

149 Arellano, 315 S.W.3d at 577-578 (“Here, Appellants’ first issue merely consists of a few conclusory statements . . . . Although they attack the credibility of Appellees’ attorney, they fail to discuss why the evidence supporting the verdict is insufficient. Moreover, Appellants’ second and third issues merely recite the issues stated without providing any discussion, argument, authority, or substantive analysis. Accordingly, we find Appellants inadequately briefed their complaints and overrule the same.”); Brown v. Tex. Bd. of Nurse Exam’rs, 194 S.W.3d 721, 723 (Tex. App.—Dallas 2006, no pet.) (“Brown does not cite any authority or offer a clear and concise argument to support her contention that she has a constitutional due process right to bill of review, and that the vexatious litigant statute violates that right. . . . We conclude the issue is inadequately briefed and presents nothing for review.”); Santillan v. Nat’l Union Fire Ins. Co., 166 S.W.3d 823, 824 (Tex. App.—El Paso 2005, no pet.) (issue inadequately briefed where appellant merely uttered conclusory sentences); Sterling v. Alexander, 99 S.W.3d 793, 799 (Tex. App.—Houston [14th Dist.] 2003, pet. denied) (issue inadequately briefed when appellant failed to make a cogent argument).

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Respectfully submitted,

LILLARD WISE SZYGENDA PLLC

By: /S/ Robert K. Wise Robert K. Wise State Bar No. 21812700 bwise@lwsattorneys.com

5949 Sherry Lane, Suite 1255 Dallas, Texas 75225 214 • 739 • 2000 Telephone 214 • 739 • 2010 Fax

ATTORNEYS FOR APPELLEE AUCTION CREDIT ENTERPRISES, LLC

49

CERTIFICATE OF COMPLIANCE WITH RULE 9.4 This brief complies with the limitations of Tex. R. App. P. 9.4(i)(2)(B)

because it contains 11,047 words, excluding the parts of the brief exempted by

Tex. R. App. P. 9.4(i)(1), and it complies with the typeface requirements of Tex. R.

App. P. 9.4(e) because it was prepared in a proportionally spaced typeface using

Microsoft Word 2010 in Times New Roman 14 pt. font for text and 12 pt. font for

the footnotes.

Dated: April 8, 2015

/s/ Robert K. Wise Robert K. Wise, Attorney for Appellee

CERTIFICATE OF SERVICE

On April 8, 2015, a true and correct copy of this brief was served by EFC

and U.S. certified-mail, return-receipt requested on Appellant’s attorneys:

John Leslie John Leslie│PLLC 1805 West Park Row Drive, Suite C Arlington, Texas 76013

Yolonda Sewell 6731 Bridge Street, Suite 379 Fort Worth, Texas 76112

/s/ Robert K. Wise

, ACCEPTED 05-14-01392-CV

FIFTH COURT OF APPEALE

DALLAS, TEXAS

3/24/2015 12:00:10 AM

LISA MATZ

CLERK

Appeal No. 05-14-01392-CV

In the Court of Appeals

Fifth Judicial District

Dallas, Texas

K.W. Ministries, Inc. v. Auction Credit Enterprises, LLC

APPELLANT'S BRIEF

ORAL ARGUMENT REQUESTED

Yolonda Sewell Attorney for Appellant State Bar No. 24044111 6731 Bridge Street, Suite 379 Fort Worth, Texas 76112 Telephone: (806)239-2130 Facsimile: (817)531-9977 E-mail: yolonda sewell@yahoo.com

John E. Leslie State Bar No. 12231400 JOHN LESLIE I PLLC 1805 West Park Row Drive, Suite C Arlington, Texas 76013 Telephone: (817) 505-1291 Facsimile: (817) 505-1292 Email: arlingtonlaw@aol.com

EXHIBIT A

Identity of Parties and Counsel

The following is a list of all parties and all counsel in this matter:

Appellant in this matter is K.W. Ministries, Inc. f/d/b/a C.R.U.S.H. Auto Sales, and

is Plaintiff in the underlying case described below. The attorneys representing Appellant

are:

Yolonda Sewell John Leslie 6731 Bridge Street, Suite 379 John Leslie PLLC Fort Worth, Texas 76112 1805 W. Park Row Drive, Suite C Tel: (806) 239-2130 Arlington, Texas 76013 Fax: (817) 531-9977 Tel: (817) 505-1291 Fax: (817) 505-1292

Appellee in this matter is Auction Credit Enterprises, LLC, and is Defendant in the

underlying case described below. The attorneys representing Appellee are:

Robert Wise Lillard Wise & Szygenda, PLLC 5949 Sherry Lane, Suite 1255 Dallas, Texas 75225 Tel: (214) 739-2005 Fax: (214) 739-2010

\

Table of Contents

Identity of Parties and Counsel ............................................... 2

Table of Contents ................................................................................. 3, 4

Index of Authorities ................................................................................. 5

Statement of the Case ................................................................................ 6

Issues Presented ........................................................................................ 6

I. The trial court erred when it failed to consider K.W. Ministries, Inc.'s

amended response .......................................................... 17, 18, 19

II. The trial court erred in granting Auction Credit Enterprises, LLC's no-

evidence motion for summary judgment when there is some evidence to

support K.W. Ministries, Inc. 's claims ...................................... 19, 20

III. The trial court erred in granting Auction Credit Enterprises, LLC's

traditional motion for summary judgment when there is a genuine issue of

material fact. ........................................................................ 20

Statement of Facts ............................................. 7, 8, 9, 10, 11, 12, 13, 14, 15, 16

Summary of Argument ........................................................................ 16, 17

Argument ............................................................................................. 17

I. Standard of Review ............................................................ 17, 18

II. Amended Summary Judgment Response Disallowed ................ 18, 19, 20

III. Some Evidence to Defeat No-Evidence Motion ........................... 20, 21

IV. Genuine Issue Material Fact to Defeat Traditional Motion ............... 21, 22

Prayer ................................................................................................ 22

Appendix .................................................................................. 23, 24, 25

I. Copy of Pinal Summary Judgment ............................................. 23

II. Text of Texas Rule of Civil Procedure 166a .......................... 23, 24, 25

III. Text of Texas Civil Practice & Remedies Code §16.068 ..................... 25

IV. Contract Between The Parties .................................................... 25

Index ofAuthorities

Rules

Texas Rule of Civil Procedure 166a ........................................................... 17, 18

Statutes

Texas Civil Practice & Remedies Code §16.068 .............................................. 19

Cases

Austin v. !net Technologies, Inc., 118 S.W.3d 491, 495 (Tex. App.-Dallas 2003) .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16, 17, 21

Havlen v. McDougall, 22 S.W.3d 343, 345 (Tex. 2000) ........................................ 16

Nixon v. Mr. Property Management Co., 690 S.W.2d 546, 548-49 ((Tex.1985) ....... 16, 17

Wayment v. Texas Kentworth Company, 248 S.W.3d 883, 885 (Tex. App.-Dallas 2008)

(citing Tex.R.Civ.P. 166a(i) and Western Inv., v. Urena, 162 S.W.3d 547, 550 (Tex.

2005)) ............................................................................................. 17, 19

Statement of the Case

1. The underlying suit arises out of Cause No. DC-13-14570, styled "K.W.

Ministries, Inc. d/b/a C.R.U.S.H. Auto Sales v. Auction Credit Enterprises, LLC," in the

I 16th Judicial District Court, Dallas County, Texas. 1

2. The underlying suit is an action for breach of contract, fraud, defamation,

deceptive trade practices, and damages arising from a motor vehicle floorplan financing

agreement. 2

3. Appellee, Auction Credit Enterprises, LLC, filed a traditional and no-

evidence motion for summary judgment. 3 Appellant filed an original and amended

response. 4 The district court did not consider the amended response. 5

4. The district court granted Appellee's motion for summary judgment. 6 This

appeal ensued. 7

Issues Presented

I. The trial court erred when it failed to consider K.W. Ministries, Inc.'s

amended summary judgment response.

a. Texas Rule of Civil Procedure 166a applies

b. The Relation-Back Doctrine applies

II. The trial court erred in granting Auction Credit Enterprises, LLC's no-

1 C.R. at 5-65. 2 Id. 3 Id. at 69-406 4 Id. at 407-424 and 483-522. 5 R.R. at 29-36. 6 C.R. at 600-01. 7 Id. at 602-04.

evidence motion for summary judgment when there is some evidence to

support K.W. Ministries, Inc. 's claims.

III. The trial court erred in granting Auction Credit Enterprises, LLC's traditional

motion for summary judgment when there is a genuine issue of material fact.

Statement of Facts

In the summer of 2011, Plaintiff was engaged in the business of selling used

vehicles to retail customers from a lot on Lancaster Street in Fort Worth, Texas under

the assumed name "C.R.U.S.H. Auto Sales". 8 Defendant was in the business of

providing inventory financing to used car dealers, commonly referred to as "floorplan

financing". 9 In late July or early August 2011, Joe Madrid ("Madrid"), Defendant's

Regional Manager, made a "cold call" on Plaintiff at its business premises to see if

Plaintiff was interested in obtaining floor plan financing for its used car inventory. 10

Defendant, after one or more follow-up calls and meetings with Plaintiff, offered to

extend "floor plan" financing to Plaintiff through its representative, Madrid. Plaintiff

accepted Defendant's offer. 11

In furtherance of the "floor plan" lending arrangement, on August 11, 2011

Plaintiff, by and through Kenneth Williams ("Williams"), its President, signed a

"Demand Promissory Note and Security Agreement" (the "Contract") at Defendant's

office under the direction of Defendant's representative "Agnes." 12 Although

8 C.R. at 6. 9 Id. 10 Id. 11 Id. 12 Id.

Williams' signature was notarized within the Contract, Madrid, the Notary Public who

purportedly acknowledged Williams' signature to the Contract, was not present when

Williams signed the Contract and Williams never saw Madrid affix his notary signature

or stamp to the Contract. 13 Neither Williams nor Plaintiff was given a copy of the

Contract at the time it was signed, or at any time thereafter. 14 After making demand

on Defendant for a copy of the Contract, Plaintiff finally received a copy of the

Contract on November 17, 2011, following Defendant's termination of its floorplan

relationship with Plaintiff. 15

At the time the Contract was entered into by Plaintiff, Plaintiff had no previous

experience with floorplan financing arrangements, a fact communicated by Williams

to Madrid. 16 Defendant, being fully aware of Plaintiffs lack of knowledge of the

details of floorplan financing and Plaintiffs inferior bargaining position, told Plaintiff

that its physical possession of titles to vehicles Plaintiff owned outright, free and clear

of liens, of an aggregate value of $75,000.00, together with a lien and security interest

on all of Plaintiffs then-existing and after-acquired property, was necessary to initially

secure the floorplan arrangement. 17 In accordance with its demand, at the time the

Contract was signed, Defendant took physical possession of titles to the following

vehicles: a 2010 Cadillac SRX Luxury (VIN #3GYFNAEYIAS516971); a 2010

Toyota Camry LE (VIN#4Tl BF3EK5AUI00605); a 2008 Chrysler 300 (VIN

13Id. 14 Id. IS Id. 16 Id. 11 Id.

#2C3LA53G08H303839); and a 2007 Cadillac CTS (VIN# IG6DP577670122419),

promising to return the titles to Plaintiff on November 1, 2011 (collectively, the

"Pledged Vehicles"). 18

During August, September and October, 2011, Plaintiff purchased a number of

vehicles with the floorplan financing provided by Defendant and paid for these

vehicles on a timely basis, without default, according to the terms of the Contract. 19

At the outset of their relationship, and at all times thereafter, Defendant instructed

Plaintiff to make payment checks payable to "AAA" and not to Auction Credit

Enterprises, LLC. Not knowing the reason or justification for this request, Plaintiff

nonetheless complied with Defendant's instructions.

From time to time, Defendant requested post-dated checks from Plaintiff to pay

for vehicles financed through Defendant which were contracted for sale, but not yet

funded by the purchasers or their banks. 20 Defendant was instructed by Plaintiff to

hold these checks until the sales were closed and the purchase price was received by

Plaintiff. 21 Nonetheless, on two occasions Defendant deposited Plaintiffs payment

check earlier than agreed upon, resulting in the checks being returned "NSF" by

Plaintiffs bank. 22 In at least one instance, Defendant charged Plaintiff a $200.00 fee

per returned check, even though Plaintiffs recollection was that the Contract provided

18 Id. at 6-7. 19 Id. at 7. 20 Id. z1 Id. 22 Id.

for only a $50.00 returned check fee. 23 Plaintiff believed Defendant's demand for the

higher NSF fee was in violation of the Contract's terms. However, Plaintiff paid the

higher fee without question or complaint in order to preserve its then-cordial business

relationship with Defendant. 24

As November 1, 2011 approached, Plaintiff began to make inquiries of

Defendant about the promised return of the titles to the Pledged Vehicles. 25 Defendant

refused to return these titles to Plaintiff, even though Plaintiff was not in payment

default under the Contract. 26 In order to assure Defendant of its fully (and actually,

over) secured position under the Contract, Plaintiff attempted to pay for several

vehicles in its inventory in advance of the payment date required under the Contract. 27

Defendant refused to accept Plaintiff's payment for these vehicles, accelerated all

amounts due under the Contract, and demanded payment of the entire amount

advanced to Plaintiff under the Contract, even though payments on specific vehicles

were not yet due. 28 There was no outstanding uncured event of default under the

Contract when this demand was made. On November 16, 2011, at approximately 3:45

p.m., Defendant, by and through its employees Madrid and Jesse Hidalgo, came to

Plaintiffs car lot under the auspices of an "inventory check". 29 At that time, Defendant

demanded possession of, and removed the following vehicles from Plaintiff's business

23 Id. (referencing Contract §2.3(1)). 24 Id. at 7. 25 Id. 26 Id. 21 Id. 2s Id. 29 Id.

premises: a 2008 Chrysler 300 (VIN#2C3LA53G08H303839, one of the

aforementioned "Pledged Vehicles"); a 2007 Kia Spectra (VIN

#KNAFE121675453928); and a 2006 Nissan Maxima (VIN

#IN4BA4IEX6C853039). 30

On November 17, 2011, Defendant finally provided Plaintiff with a copy of the

Contract. Over three (3) months had passed from the time the Contract was signed

until Defendant finally gave Plaintiff a copy of the Contract.

On November 18, 2011, Defendant took possession of an additional vehicle

owned by Plaintiff: a 2010 Cadillac SRX Luxury (VIN# 3GYFNAEYIAS516971,

being the second of the "Pledged Vehicles"). 31 This vehicle was seized at the Manheim

Dallas - Fort Worth auction facility where it had been placed by Plaintiff for sale. On

that same day, Defendant came to Plaintiffs business premises and attempted to take

possession of a 2010 Toyota Camry LE (VIN #4TIBF3EK5AUI00605, the last

remaining "Pledged Vehicle"). 32 Defendant used a different vehicle to block the sole

entry to Plaintiffs car lot, thereby preventing Plaintiffs customers and employees

from entering or exiting Plaintiffs business premises while Defendant unsuccessfully

attempted to seize the aforementioned Toyota Camry. 33 One of Plaintiffs salesmen

suffered bodily injury as a result of Defendant's actions. 34

On November 21, 2011, Defendant took possession of a 2006 Kia Sorento from

30 Id. at 7-8. 31 Id. at 8. 32 Id. 33 Id. 34 Id.

JO

a third-party repair facility and a 2004 Nissan Maxima from Plaintiff's business

premises while the vehicle was being repaired. 35 At the time of repossession,

Defendant's representatives were told that the 2004 Nissan Maxima was owned by,

and titled to, a customer of Plaintiff who was paying for the vehicle under a retail

installment contract. This fact was of no consequence to Defendant, who defiantly

repossessed the vehicle. As a result of Defendant's actions, Plaintiff was forced to

provide its customer with a replacement vehicle. Defendant did not return the Maxima

for over three (3) months, finally surrendering the vehicle to Plaintiff in March 2012.

By the time the Maxima had been returned to Plaintiff, Plaintiff had lost the

opportunity to sell the loaned vehicle before the model year change, thereby being

damaged by its loss of value.

After the wrongful repossessions of vehicles on November 21, 2011, Plaintiff

that same day sent Defendant a letter detailing its position with respect to the actions

taken by Defendant and requested that Defendant refrain from further interruption of

Plaintiff's business. 36 On the following day, Plaintiff spoke with Defendant regarding

its intent to pay Defendant all amounts properly due under the Contract. In response,

Defendant requested that Plaintiff submit a written payment plan to Defendant by

Friday, November 25, 2011. 37

Prior to expiration of the November 25, 2011 deadline, the following described

3s Id. 36 Id. 37 Id. at 8-9.

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exchanges of correspondence occurred38 :

On November 23, 2011, Plaintiff received a letter from Defendant notifying

Plaintiff of its private disposition of collateral in satisfaction of Plaintiffs

obligations to Defendant.

On November 23, 2011, Plaintiff responded to Defendant's notice of private

disposition of collateral, seeking clarification of certain items prior to

submitting its payment plan to Defendant.

On November 25, 2011, Plaintiff submitted its payment plan to Defendant.

On November 28, 2011, Defendant replied by demanding payment in full of all

vehicles sold "out of trust" by December 2. 2011.

Between December 6-8, 2011, Plaintiff paid Defendant $3 6, 670. 00 in certified

funds, representing over sixty percent (60%) of the total balance alleged to be due

Defendant. On December 22, 2011, Plaintiff remitted another certified funds payment

to Defendant in the amount of $8,300.00, bringing total payments to $44,970.00,

approximately 80% of the total amount claimed as due by Defendant. 39

On December 6, 2011, Plaintiff remitted certified funds to Defendant in

payment for a 2005 Ford F-150, a 2004 Nissan Maxima, and a 2007 Kia Spectra. 40 At

that time, Plaintiff also intended to remit payment for a 2007 Pontiac G5; however,

since Defendant had not received title to the vehicle, Plaintiffs payment for the vehicle

38 Id. at 9.

39Id. 40Jd.

1).._

was not accepted by Defendant. 41 Accordingly, Plaintiff tendered payment for a 2007

Hyundai Elantra for which title had been received, using the check originally

designated for the 2007 Pontiac G5. 42 The 2007 Hyundai Elantra had been recently

sold to a customer of Plaintiff, and was in the customer's possession. 43 Defendant

refused this tender of payment, stating that the cashier's check showed "2007 Pontiac

GS." Plaintiff suggested striking through 2007 Pontiac G5, inserting 2007 Hyundai

Elantra, and initialing the change in its capacity as remitter of the check. 44 Defendant

continued to refuse tender of this check.

Plaintiff indicated that it would return the next day with a new, replacement

check for the 2007 Hyundai Elantra. 45 However, that same night, before Plaintiffcould

bring a replacement check to Defendant, Defendant repossessed the 2007 Hyundai

Elantrafrom Plaintiff's customer's residence. 46 The following day, Plaintiff tendered

payment for the 2007 Hyundai Elantra, as originally promised, and paid the

repossession fee to Defendant, even though repossession was unwarranted and

wrongful, resulting in damages to Plaintiff, both for the repossession fee and in its

business reputation with its customer. 47

The following additional wrongful acts by Defendant occurred on the same day

as the acts complained of in the immediately preceding paragraph. All of the acts of

41 Id. at 9-10. 42 Id. at 10. 43 Id. 44 Id

4s Id.

46 Id. 41 Id.

Defendant on December 6, 2011 eventually led to the closure of Plaintiffs used car

business. On December 6, 2011, Plaintiff discovered that Defendant had placed

unnecessary and unjustified liens on the following vehicles: a 2007 Suzuki XL 7; a

2007 Kia Spectra; a 2005 Ford F-150, and a 2004 Nissan Maxima. At the time these

liens were placed on the vehicle titles, Defendant had actual physical possession of the

titles and/or possession of the vehicles on which the liens were placed; therefore,

recording liens on the titles was unnecessary. Thereafter, after these titles and the titled

vehicles were returned to Plaintiff, Defendant knowingly executed invalid releases of

lien on the same vehicles, as Madrid, Defendant's Branch Manager negligently and

carelessly failed to write and sign his legal name on the titles in the manner required

by the Texas Department of Motor Vehicles, thereby invalidating the releases and

further damaging Plaintiff and its business reputation. 48

On December 22, 2011 while making payment on a 2006 Nissan Maxima,

Plaintiff was informed that Defendant charged additional repossession fees on the

following vehicles: a 2004 Nissan Maxima; a 2006 Kia Sorento; a 2004 GMC Savana;

a 2001 Nissan Altima; a 1997 Mitsubishi Montero Sport; a 2005 Ford F-150; and a

2007 Hyundai Elantra, increasing the remaining balance allegedly due Defendant

under the Contract to $17,998.88. 49 Defendant confirmed this balance due by handing

the written statement of its Chief Operating Officer, Tedd Martin to Plaintiff in a

meeting on December 22, 2011. However, despite its reasonable and repeated

48 Id. 49 Id.

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requests, Defendant never provided Plaintiff with a full accounting of the debt alleged

to be due. 50 Defendant, in its pleadings, denies that it was obligated to provide Plaintiff

with any accounting of the funds allegedly due Defendant. 51

Defendant sold the 1997 Mitsubishi Montero Sport, 2001 Nissan Altima, 2004

GMC Savana, 2006 Kia Sorento, 2008 Chrysler 300, and 2010 Cadillac SRX which it

52

had previously repossessed to satisfy the debt.

On April 10, 2012, Plaintiff made demand on Defendant for damages under the

Texas Deceptive Trade Practices Act, set forth in Tex. Bus. And Comm. Code section

17.41 et seq. ("DTPA"). 53

Defendant finally paid Plaintiff its over-collection on proceeds of collateral in

early May, 2012, almost six (6) months after it terminated its loan relationship with

Plaintiff, four and one half (4Yz) months from the date of its last meeting with Plaintiff

and over three and one half (3 Yz) months after its last sale of any vehicles.

Summary ofArgument

The trial court erred when it failed to consider K. W. Ministries, Inc.' s amended

summary judgment response. The amended summary judgment response was timely

pursuant to Texas Rule of Civil Procedure 166a and the relation back doctrine as articulated

in Texas Civil Practice and Remedies Code §16.068. The amended response contains

50 Id. at 10-11. 51 C.R. at 69 et seq. 52 C.R. at 11. 53 Id.

evidence sufficient to defeat the no-evidence and traditional motions for summary

judgment.

Argument

L Standard ofReview

A defendant moving for a traditional summary judgment must either ( 1)

conclusively disprove at least one element of the plaintiffs theory ofrecovery; or (2) plead

and conclusively establish each element of an affirmative defense. 54 When a defendant

moves for summary judgment on an affirmative defense, it is the defendant's burden to

conclusively establish the defense. 55 Once the movant establishes the right to summary

judgment, the burden shifts to the non-movant to present the trial court with evidence of

any issues that would preclude summary judgment. 56 A motion for summary judgment on

traditional grounds is subject to de novo review. 57 In reviewing a motion for summary

judgment, the appellate court must determine if any genuine issue of material fact exists to

defeat the motion. 58 Evidence favoring the non-movant is taken as true and all reasonable

inferences must be resolved in favor of the non-moving party. 59

In a no-evidence summary judgment motion, the movant asserts there is no

evidence of one or more elements upon which an adverse party has the burden of proof at

5 4 Austin v. Inet Technologies, Inc., 118 S.W.3d 491, 495 (Tex. App.-Dallas 2003).

55 Havlen v. McDougall, 22 S.W.3d 343, 345 (Tex. 2000). 56 Austin, 118 S.W.3d at 495. 57 Nixon v. Mr. Property Management Co., 690 S.W.2d 546, 548-49 (Tex. 1985). 58 Id. 59 Id.

trial. 60 To defeat a no-evidence summary judgment motion, the non-moving party must

point out evidence that raises a fact issue on the challenged elements. 61 Like a motion for

traditional summary judgment, the standard of review for a no-evidence summary

judgment is de novo. The reviewing court must construe the record in the light most

62

favorable to the non-movant while disregarding all contrary evidence and inferences.

IL Amended Summary Judgment Response Disallowed

The trial court erred when it failed to consider K.W. Ministries, Inc.'s amended response.

The trial court erred when it failed to consider K.W. Ministries, Inc. 's amended

response in deciding Auction Credit LLC's amended traditional and no-evidence motion

for summary judgment. Auction Credit LLC filed its amended traditional and no-

evidence motion for summary judgment on August 25, 2014. 63 Pursuant to Texas Rule of

Civil Procedure 166a, K.W. Ministries, Inc. 's response was due on or before September

8, 2015. 64 K.W. Ministries, Inc. filed a response to the motion on said date. 65

Additionally, K.W. Ministries, Inc. filed an amended response the morning of, but prior

to the summary judgment hearing. 66 The trial court declined to consider the amended

response and the factual and legal evidence contained within the response. 67

Texas Rule of Civil Procedure 166a(c) states

60 Wayment v. Texas Kentworth Company, 248 S.W.3d 883, 885 (Tex. App.-Dallas 2008) (citing Tex.R.Civ.P.

166a(i) and Western Inv., v. Urena, 162 S.W.3d 547, 550 (Tex. 2005)). 61 Austin, 118 S.W.3d at 495. 62 Jd. 63 See generally C.R. at 69-127. 64 Tex. R. Civ. Pro. 166a(c) (2014). 65 C.R. at 407-24. 66 See generally C.R. at 483-522. 67 R.R. at 29-30, 36-37.

JI

The judgment sought shall be rendered forthwith if (i) the deposition transcripts, interrogatory answers, and other discovery responses referenced or set forth in the motion or response, and (ii) the pleadings, admissions, affidavits, stipulations of the parties, and authenticated or certified public records, if any, on file at the time ofthe hearing, or filed thereafter and before judgment with permission of the court, show that, except as to the amount of damages, there is no genuine issue as to any material fact and the moving party is entitled to judgment as a matter of law on the issues expressly set out in the motion or in an answer or any other response. 68

In the instant case, the amended response was on file at the time of the hearing, but the

trial court failed to consider the amended response. 69 The amended response was

sufficient to raise a genuine issue of material fact to defeat the traditional motion for

summary judgment. 70 Likewise, the amended response proffered more than a scintilla of

probative evidence as necessary to defeat the no-evidence motion for summary

judgment. 71 Consequently, the court erred in failing to consider the amended response

prior to rendering a decision on Auction Credit LLC's motion and in granting the

summary judgment.

The trial court also erred in failing to consider the amended summary

judgment response when the relation back doctrine applies. The trial court indicated that

the deadline to file a response was September 8, 2015. As such, the trial court found that

K. W. Ministries, Inc.' s amended response was untimely. 72 However, the relation back

doctrine applies. The relation-back doctrine states that an amendment of a timely-filed

pleading is timely unless the amendment is "wholly based on a new, distinct, or different

68 Tex. R. Civ. Pro. 166a(c) (2014) (emphasis added). 69 R.R. at 29-30, 36-37. 70 See generally C.R. at 483-522. 11 Jd. 72 R.R. at 36-37.

transaction or occurrence." 73 In this case, the amended response was based on the same

case, the same parties, the same contract, the same facts, and the same circumstances.

Therefore, the amended response should be deemed the same transaction or occurrence and

found to be timely in accordance with the relation-back doctrine. The trial court erred in

deeming the amended response untimely and failing to consider the contents of the same.

IIL Some Evidence to Defeat No-Evidence Motion

The trial court erred in granting Auction Credit Enterprises, LLC's no-evidence motion for summary judgment when there is some evidence to support K.W.

Ministries, Inc.' s claims.

The trial court erred in granting Auction Credit Enterprises, LLC' s no-evidence

motion for summary judgment because there exists some evidence to support K.W.

Ministries, Inc.' s claims. In order to prevail on a no-evidence summary judgment motion,

the movant must show that there is no evidence of one or more elements upon which an

adverse party has the burden of proof at trial. 74 On the contrary, to defeat a no-evidence

summary judgment motion, the non-moving party must point out evidence that raises a

fact issue on the challenged elements.

Auction Credit Enterprises, LLC did not meet its burden. For example, on the

breach of contract claim, K. W. Ministries, Inc. offered evidence to show that Auction

Credit Enterprises, LLC breached the agreement by charging excessive insufficient fund

73 Tex. Civ. Prac & Rem. Code §16.068 (2014).

74 Wayment, 248 S.W.3d at 885.

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fees, 75 by requiring certified funds, 76 by declining curtailments or extensions, 77 by

repossessing vehicles under retail installment contract, 78 by charging for multiple lot

checks, 79 by selling collateral for less than commercially reasonable values, 80 by failing

to proceed against the bond, 81 by failing to timely return excess proceeds, 82 and by failing

to provide an accounting. 83 Similarly, K.W. Ministries, Inc. provided evidence that

Auction Credit Enterprises, LLC was not entitled to a qualified privilege on the

defamation claim. 84 Further, K.W. Ministries, Inc. introduced evidence of Auction Credit

Enterprises, LLC's unconscionable actions as it relates to the Texas Deceptive Trade

Practices Act claim. 85 The facts and law outlined in the amended response amount to

more than a scintilla of probative evidence necessary to defeat the no-evidence motion

for summary judgment. 86 Therefore, the trial court erred by granting the motion for

summary judgment.

IV. Genuine Issue of Material Fact to Defeat Traditional Motion

The trial court erred in granting Auction Credit Enterprises, LLC's traditional motion for summary judgment when there is a genuine issue of material fact.

The trial court erred in granting the amended traditional motion for summary

15 R.R. at 509-10. 16 Id. at 510-11. 11 Id. at 511-12. 78 Id. at 512-15. 19 Id. at 515. 80 Id. at 515-16. 81 Id. at 516-17. 82 1d.at517. 83 Id. at 518-19. 84 Id. at 492-97. 85 Id. at 506-07. 86 See generally id. at 483-522.

judgment because there exists a genuine issue of material fact to defeat the motion. To be

successful on a traditional motion for summary judgment, the moving party must prove

there exists no genuine issue of material fact. 87 As stated in argument section three, the

amended response brings to light both genuine issues of material fact as well as defeats

the affirmative defense claimed by Auction Credit Enterprises, LLC. 88 Namely, Auction

Credit Enterprises, LLC charged excessive insufficient fund fees, was not legally entitled

to a claim of qualified privilege, and committed unconscionable actions as articulated in

mandatory precedent. 89 The trial court erred by granting the motion in light of the

evidence in the amended response.

Prayer

K. W. Ministries, Inc. prays that this Court find that the trial court erred by

disallowing the amended response and granting the motion for summary judgment when

more than a scintilla of probative evidence exists.

87 Austin, 118 S.W.3dat495. 88 See generally R.R. at 483-522. 89 See notes 22-32.

Respectfully submitted,

By: /sNolonda Sewell Yolonda Sewell Texas Bar No. 24044111 6731 Bridge Street, Suite 379 Fort Worth, Texas 76112 Tel. (806) 239-2130 Fax. (817) 531-9977 E-mail yolonda_ sewell@yahoo.com Attorney for Appellant K.W. Ministries, Inc. dba CRUSH Auto Sales

CERTIFICATE OF SERVICE

I certify that, on February 21, 2015, I served a copy of Appellant's Brief by electronic service on Robert K. Wise at bwise@lwsattorneys.com. I further certify that a copy of this corrected brief was served on Robert K. Wise, appellee's counsel, by electronic service at bwise@lwsattorneys.com on March 23, 2015.

/s/Yolonda Sewell

Yolonda Sewell

?-)_

Appendix

I. Copy of Final Summary Judgment

IL Text of Texas Rule of Civil Procedure 166a

III. Text of Civil Practice and Remedies Code § 16.068

IV. Contract Between The Parties