Sullivan, Glenn v. Jani-King of New York

Court of Appeals of Texas·Decided July 11, 2013·No. 05-11-01546-CV·Published

Opinion

AFFiRM; and Opinion Filed July II, 2013.

In The

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!iftt tliritrirt nf exai ti ThiIlu

No, OS-i 1-01546-CV

GLENN SULLIVAN, Appellant V.

.JANI-KING OF NEW YORK, INC., Appellee

On Appeal from the 160th Judicial District Court Dallas County, Texas

Trial Court Cause No. 05-12092

MEMORANDUM OPINION

Before Justices Lang-Miers and Fillmore’

Opinion by Justice Lang-Miers Jani-King of New York, Inc. sued Glenn Sullivan for breach of contract and fraudulent

inducement. Sullivan counterclaimed for breach of contract and fraudulent inducement. A jury found in favor of Jani-King on all issues. Sullivan raises nine issues on appeal. For the following reasons, we affirm the trial court’s judgment. We issue this memorandum opinion pursuant to Texas Rule of Appellate Procedure 47.4 because the law to be applied in the case is well settled.

BACKGROUN D

Jani-King operates and franchises commercial cleaning businesses. In 1998, Sullivan purchased a Jani-King franchise and signed a franchise agreement. The franchise agreement allowed Sullivan to solicit cleaning contracts, but those contracts had to be approved by Jani

The Honorable Mary Murphy, retired Justice. Court of Appeals for the Fifth District of Texas at Dallas. sat on the panel on submission but did not participate in this decision.

King. The franchise agreement required Sullivan to pay JaniKing a 1(Yk royalty fee and a 05% advertising fee calculated on Sullivan’s gross revenue. JaniKing in return provided advertising services and hmlled and collected payments I ruin the clients. The franchise agreement prohibited Sullivan Ironi engaging or having a lmnancial interest in a competing business.

In 2002, Sullivan sued JaniKing in New iork alleging that JaniKing breached the franchise agreement. As part of its investigation of Sullivan’s lawsuit, JaniKing learned that Sullivan had started his own cleaiiing company separate from Jani-King and had live accounts he serviced outside the JaniKing franchise. In 2003. JaniKing sued Sullivan in Dallas County alleging that Sullivan breached the franchise agreement by, among other things, operating a competing business, The parties settled their disputes in both lawsuits and executed a settlement agreement dated May 1, 2004.

In the settlement agreement, Sullivan acknowledged that he had operated a competing business. He agreed to “immediately and permanently cease operation” of the competing business “and to immediately take all steps necessary to assign or transfer all competing contracts. accounts and/or customers to Jani-King.” For its part, Jani-King agreed to offer Sullivan in good faith, within twelve months of the date of the settlement agreement, accounts with monthly gross billings of at least $18,000, and, if it failed to do so, to pay Sullivan 25% of the difference between $18,000 and the actual gross monthly billings of the contracts offered to Sullivan. In the settlement agreement, the parties agreed that the franchise agreement continued in full force and effect.

In 2005, Jani-King sued Sullivan for fraudulent inducement and breach of the franchise and settlement agreements. Jani-King alleged, among other things, that Sullivan did not comply with the provisions in the settlement agreement to “immediately and permanently cease operation” of the competing business and to transfer the outside accounts to Jani-King and did

not comply with the ftanchise agreement to pay royalty and advertising fees to JaniKing. Sullivan counterclaimed for fraudulent inducement and breach of the settlement agreement illcging Ihdi I mi king did not of h him on1r Lets with monthly gloss billings of it k ist

Si ,UOO. Before trial. Jaiii-King dropped its claim of fraudulent inducement.

The jury found that Sullivan failed to comply with both the settlement agreement and the franchise agreement and awarded Jani-King 5223,075 in damages and 580,000 in attorney’s fees for representation at trial. The jury found that Jani-King did not commit fraud against Sullivan.

On appeal, Sullivan argues that the evidence is legally and factually insufficient to support the jury’s findings, and the trial court erred by allowing testimony about Jani-King’s damages and attorney’s fees and by not reforming the judgment to assess damages in favor of him and against Jani- King.

SUFFICIENCY OF THE EVIDENCE Sullivan challenges the legal and factual sufficiency of the evidence supporting several of the jury’s answers. Jani-King argues that Sullivan’s factual sufficiency complaints are not preserved for appellate review.

A party complaining that evidence is factually insufficient to support the jury’s findings must file a motion for new trial to preserve the complaint for appellate review. TEX. R. CIV. P. 324(b)(2), (3). Sullivan did not file a motion for new trial, but he argues that his motion to disregard the jury’s findings or for judgment notwithstanding the verdict suffices as a motion for new trial and that we should look to the substance of his motion rather than its form. At oral argument, Sullivan contended that the general request for relief in his motion—”[flor any further relief to which Sullivan may be entitled”—was sufficient to preserve the issue for our review. And he argues that our opinion in PopCap Gaines, Inc. v. Miunbofumbo, LLC, 350 S.W.3d 699

([cx. App. Dullas 201 pet. denied) suppurts his argument that he preserved the factual sulliciencv complaints br appellate review. \Ve do Hot agree.

A motion for new trial asks the trial court to vacate the juthmient and order a new trial on the issues. See in re BroaksJiire Grocery (. 25() S.W.3d 66, 73 (Tex. 2008) (orig. proceeding) (stating “fundamental nature of a new trial motion ...seeks not to reborm, but to lcwule the court’s judgment): Mercer v. Band, 454 S.W.2d 833, 836 (Tex. App.—Houston 114th Dist.} 1970, no writ) (stating motion for new trial must “seek to have an existing judgment set aside and request a relitigat ion of the issues”), Sullivan’s motion to disregard the jury’s findings or for judgment notwithstanding the verdict did not ask the trial court to vacate the judgment and order a new trial. Instead, it asked the trial court to strike the jury’s answers and render a judgment in his ftivor because “the evidence conclusively proves facts that establish Sullivan’s right to judgment as a matter of law:’

We also do not agree that our opinion in PopQap Gaines controls the outcome in this case. In PopCap Games, we had to determine whether a motion for new trial on the sole issue of damages sufficed as a motion for new trial so as to extend the deadline for filing a notice of appeal. 350 S.W.3d at 715. We said it did because MumboJumbo “expressly sought to relitigate some of the issues in the case.” Id. at 716. We also noted that if the trial court granted MumboJumbo’s motion, a new trial would have resulted. Id. at 716—17. Unlike in PopCap Games, however, Sullivan’s motion did not seek to relitigate any of the issues in the case. And if the trial court had granted Sullivan’s motion, it would not have resulted in a new trial but in a judgment rendered in Sullivan’s favor. We conclude that FopCap Games does not apply here.

Because Sullivan did not ask for a new trial on any of the issues, we conclude that his motion to disregard the jury’s findings or for judgment notwithstanding the verdict does not satisfy the requirements of a motion for new trial and was not sufficient to preserve his factual

sufficiency complaints for our review, See Brookshire Grocery Co., 250 S.W.3d at 73; Mercer, 454 S.W.2d at 836. Consequently, only his legal sufficiency challenges are properly before us.

Standard of Review

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