Rendon v. Sanchez

737 S.W.2d 122, 1987 Tex. App. LEXIS 8458
CourtCourt of Appeals of Texas
DecidedSeptember 2, 1987
Docket04-86-00578-CV
StatusPublished
Cited by3 cases

This text of 737 S.W.2d 122 (Rendon v. Sanchez) is published on Counsel Stack Legal Research, covering Court of Appeals of Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Rendon v. Sanchez, 737 S.W.2d 122, 1987 Tex. App. LEXIS 8458 (Tex. Ct. App. 1987).

Opinion

OPINION

BUTTS, Justice.

Plaintiffs, Pete and Edna Rendon, appeal from a judgment in favor of defendant and cross-plaintiff, Carmen Sanchez. The Ren-dons sued Sanchez for breach of contract and she countersued, alleging violation of the Deceptive Trade Practices-Consumer Protection Act, TEX.BUS. & COM.CODE ANN. § 17.41 et seq. (Vernon Supp.1987). Plaintiffs challenge the legal sufficiency of the evidence to support the jury’s answers to special issues (four points of error) and also claim in the alternative, should the judgment be affirmed, that the trial court incorrectly determined the amount of damages. We affirm the judgment.

In May of 1985, Sanchez answered the Rendons’ newspaper advertisement, offering to sell their Mexican restaurant, Los Paisanos No. 3. After seeing the restaurant, and conferring with the Rendons and their attorney, Sanchez executed a contract, which provided in part:

Seller [the Rendons] agrees to sell, and buyer [Sanchez] agrees to buy all the assets of the restaurant business, owned by seller, and consisting of those assets described and enumerated on the ‘List of Assets’ attached hereto, ... The assets being sold are those of the restaurant owned by seller and prior hereto known as ‘Los Paisanos No. 3’ ... It is hereby understood and acknowledged by the parties that sellers have the exclusive common law and statutory right to use the name ‘Los Paisanos’ and further, that no interest to the use or right to use of said name is hereby affected in any way.

*124 It further required Sanchez to assume all bills and expenses of the business and all responsibility for compliance with the lease of the building. Although there was no sublease executed, the contract required her to pay the sum of $2,640.00 per month for the leased premises. Sanchez further agreed to pay a total of $25,000.00 to the Rendons. She paid $10,000.00 down, and she was obligated to pay them six monthly payments of $538.00 with the balance of $13,722.00 due by November 1, 1985. (The sum of $538.00 was the monthly amount the Rendons owed on a bank note for the equipment.)

Sanchez paid the rent and the sum of $538.00 each month through September of 1985, ($10,560.00 and $2,152.00 respectively). However, she failed to make either payment in October, and vacated the restaurant on or about October 13. The Ren-dons were given the key, but she said they threatened to call “the cops” if she returned.

The Rendons sued for the money due under their bank note, rent payments from October 1985 to trial, interest on the Ren-dons’ bank note, other consequential damages and attorney’s fees.

Sanchez responded by filing a counterclaim alleging the Rendons violated the Deceptive Trade Practices Act, claiming that the Rendons induced her to sign the contract by making misleading and false representations about the volume of business, the amount of money the restaurant generated, the equipment and the building’s state of repair, as well as the need for inspections. She further claimed that the Rendons were negligent in making these misrepresentations. In addition she alleged that had she known of the real conditions which the Rendons failed to disclose, she would not have entered into the contract. She cited violations based on § 17.-46(b)(7), (21)(23) of the Act. Further she alleged that the Rendons actions were unconscionable, § 17.50(a)(3).

The evidence shows that the Rendons operated two restaurants, Las Paisanos No. 1 and No. 2, for several years. In 1984, they leased the premises for No. 3, the subject of this suit. In so doing they obligated themselves to pay the rent each month and they undertook a bank note obligation for $20,000.00. They also stated they expended several thousand dollars to establish the Mexican restaurant. However, within a few months, they entered into an agreement on the restaurant with a person named Colby on the same terms that Sanchez later undertook. Colby operated the restaurant about six months and failed. He apparently was permitted to use the name “Los Paisanos No. 3.”

Rendon testified they still owed the bank $15,800.00 at the time of trial in July, 1986. After Sanchez vacated the restaurant, a person named Rigo had undertaken the same obligations, paying to the Rendons the sum of $8,000.00 and paying the rent plus the sum of $538.00 per month (the Rendons’ monthly bank note payment) for seven months. After Rigo failed, another person named Wong Tang had undertaken the same obligations ($25,000.00 plus rent plus $538.00 per month to the Rendons). Tang paid down the sum of $8,000.00 and was to begin operating the restaurant in September, 1986 (after the date of the trial herein). Rendon acknowledged that none of the money paid down had been applied to pay off the bank note. The evidence showed that by the time of trial the Ren-dons had sold the restaurant four times for “down payments” totaling $31,000.00, had the rent of $2,640.00 per month on the three year lease paid by others for 17 months, and received payments of $538.00 per month for about 17 months. The Ren-dons retained the equipment and the lease. They brought suit on a contract against only one buyer: Sanchez.

Although the plaintiffs argue on appeal that the only thing they sold to Sanchez was the equipment (assets) under the contract, they both acknowledged at trial that they sold the “business.” Rendon testified that business was worth “a little more than I sold it to her for ...” “It was open, going ...” The ad Sanchez answered stated “Mexican restaurant, take over $20,000 note. $5,000 down.”

*125 Sanchez testified she understood she was buying a complete operation. The Rendons told her to continue using their license and insurance until they expired, however, she was forbidden to do this and was required to obtain a new license since the name Los Paisanos No. 3 could not be continued in use. She and her husband paid for a new liquor license, a deposit of $1,900.00 for the phone, plumbing bills, electrician bills, new inspections and installations that the new inspections required. She said the Ren-dons told her she would be able to go ahead and run the business as it was, but, she said, she was not permitted to do so and was delayed thereby in opening the restaurant. Subsequently the ice machine malfunctioned, the air conditioning proved inadequate, ceiling fans had to be installed, and a person who knew how to obtain permits and licenses had to be employed.

Further, Sanchez testified that the Ren-dons stated that the restaurant made $300.00 each day from breakfast patrons alone. They represented that the restaurant was a good investment and would produce good income. She told about the faulty equipment, saying they represented to her it was in good condition, whereas she replaced some of it, including the ice machine. The electric connections were found to be faulty. She said the Rendons failed to advise her new inspections, new insurance in the amount of $500,000.00, and repairs would be needed. She was delayed one month in opening the restaurant because of all these matters. She testified they misrepresented the volume of business the restaurant had previously been doing, that she was assured the restaurant was profitable. Instead of $300.00 a day on breakfasts alone, on average she grossed about $56.00 to $86.00 for 12 hours.

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Bluebook (online)
737 S.W.2d 122, 1987 Tex. App. LEXIS 8458, Counsel Stack Legal Research, https://law.counselstack.com/opinion/rendon-v-sanchez-texapp-1987.