Ted B. Lyon III v. Building Galveston, Inc.

Court of Appeals of Texas·Decided December 17, 2020·No. 01-19-00571-CV·Published

Opinion

Opinion issued December 17, 2020

In The

Court of Appeals

For The

First District of Texas

MEMORANDUM OPINION

This is the second appeal in an ongoing dispute between Ted B. Lyon III and Building Galveston, Inc. (BGI). In the first appeal, this Court reversed the portion of the trial court’s judgment rendered in BGI’s favor on its fraudulent lien and invalid lien claims and the award of attorney’s fees to BGI based on those claims. Lyon v. Bldg. Galveston, Inc., No. 01-15-00664-CV, 2017 WL 4545831 (Tex. App.— Houston [1st Dist.] Oct. 12, 2017, pet. denied) (mem. op.) (Lyon I). We also reversed the trial court’s denial of attorney’s fees to BGI on its breach of contract claim, and we “remand[ed] for further proceedings on the attorney’s fees issue.” Id. at *13. On remand, a visiting judge reviewed the transcripts from the original bench trial on attorney’s fees and, after hearing the parties’ arguments, awarded BGI attorney’s fees based on its breach of contract claim. Lyon and BGI are appealing the trial court’s judgment.

In six issues with multiple sub-parts, Lyon argues that: (1) the visiting judge erred by not granting him a jury trial on the issue of attorney’s fees on remand, and relying instead upon the transcripts of the 2015 bench trial; (2) the district court judge who presided over the 2015 bench trial on attorney fees abused her discretion by admitting BGI’s billing records over Lyon’s objections (Plaintiff’s Exhibit 45); (3) the visiting judge abused her discretion by considering evidence from a mediation proceeding; (4)(a) there is legally and factually insufficient evidence

supporting the visiting judges’ awards of trial and appellate fees to BGI; (4)(b) the visiting judge “improperly sua sponte awarded appellate fees [to BGI] unconditionally for the parties’ earlier appeals in this case”; (5) the visiting judge’s judgment is void or voidable because she was not authorized to “complete the April 2015 bench trial and to purportedly find facts in 2019 on disputed 2015 evidence” in violation of Lyon’s rights under the Texas and United States constitutions; and (6) the visiting judge’s judgment is void or voidable because, among other things, she did not preside over the 2015 bench trial on which her judgment on remand is based. BGI raises several counterpoints to these issues.1 In one issue, BGI argues that the trial court erred in failing to award BGI conditional appellate attorney fees.

We set aside the trial court’s judgment and dismiss the appeal for want of jurisdiction.

1 Although identified as “cross-points,” BGI’s arguments are more accurately described as “counter-points” because their function is to show that Lyon’s position is wrong. See Dudley Constr., Ltd. v. Act Pipe & Supply, Inc., 545 S.W.3d 532, 538 (Tex. 2018) (“Counter-points assist the appellate court in finding the answers given to the points of the appellant. From the standpoint of the advocate, their function is to show that the point or points of the opposite party are not valid.”) (internal quotations omitted).

Background2

In 2010, Lyon, on behalf of his construction company, and BGI entered into a subcontract agreement whereby Lyon’s company agreed to serve as BGI’s subcontractor for a project remodeling a bakery. See Lyon I, 2017 WL 4545831 at *1. After BGI fired Lyon, Lyon filed a mechanic’s and materialman’s lien on the property and sued the bakery’s owners to foreclose on the lien.3 BGI intervened in the suit several months later and asserted claims against Lyon, including claims for breach of contract and filing of a fraudulent lien. Id.

After a November 2013 trial on the liability issues, the jury found in BGI’s favor with respect to its breach of contract and invalid and fraudulent lien claims. Id. The trial was presided over by District Court Judge Michelle Slaughter.

The issue of attorney’s fees was tried to the bench by agreement of the parties five months later on April 17, 2015. Id. at *2. On April 9, 2015, eight days before the bench trial, BGI filed a supplemental petition in which it alleged that BGI had presented its claim for damages to Lyon more than thirty days before the filing of

2 The procedural and factual histories of this case were set forth in our first opinion.

See Lyon v. Bldg. Galveston, Inc., No. 01-15-00664-CV, 2017 WL 4545831 (Tex.

App.—Houston [1st Dist.] Oct. 12, 2017, pet. denied) (mem. op.) (Lyon I). Because this case is on remand and the parties are familiar with the history of this case, we will not repeat it here except as necessary to advise the parties of the Court’s decision and the basic reasons for it. See TEX. R. APP. P. 47.1, 47.4.

3 For ease of reference, we will refer to Lyon and his companies as “Lyon” in this background section.

the supplemental petition and that Lyon had failed to pay BGI’s damages within thirty days from presentment. Id.4 Judge Slaughter denied BGI’s motion for leave to file its supplemental petition because the petition was untimely. Id. at *8. Judge Slaughter, however, allowed BGI to put on testimony and offer evidence attempting to establish presentment during the trial over Lyon’s objection. Id.

At the conclusion of the bench trial, Judge Slaughter took under advisement several objections made by Lyon to BGI’s evidence. Judge Slaughter subsequently signed a final judgment in the suit in which she sustained Lyon’s objection to BGI’s evidence of presentment because BGI had not pleaded presentment of its claims as

4 Texas Civil Practice and Remedies Code section 38.001 authorizes recovery of attorney’s fees on a breach-of-contract claim. TEX. CIV. PRAC. & REM. CODE § 38.001(8). Before a party is entitled to attorney’s fees pursuant to section 38.002, however, the party must plead and prove that it presented its claim for damages to the opposing party and the opposing party refused to pay. TEX. CIV. PRAC. & REM.

CODE § 38.002; see Lyon I, 2017 WL 4545831, at *11 (citing Gibson v. Cuellar, 440 S.W.3d 150, 157 (Tex. App.–Houston [14th Dist.] 2013, no pet.)); Sacks v. Hall, 481 S.W.3d 238, 251 (Tex. App.—Houston [1st Dist.] 2015, pet. denied) (stating party “did not specifically plead that he had presented his breach of contract claim to Sacks, as he was required to do to recover attorney’s fees under Chapter 38”); see also Genender v. USA Store Fixtures, LLC, 451 S.W.3d 916, 924 (Tex. App.—

Houston [14th Dist.] 2014, no pet.) (“The claimant bears the burden of both pleading and proving presentment.”). Specifically, section 38.002 requires that:

(1) the claimant must be represented by an attorney;

(2) the claimant must present the claim to the opposing party or to a duly authorized agent of the opposing party; and (3) payment for the just amount owed must not have been tendered before the expiration of the 30th day after the claim is presented.

TEX. CIV. PRAC. & REM. CODE § 38.002.

required to recover attorney’s fees under Chapter 38 of the Texas Civil Practice and Remedies Code. Id. As a result of this ruling, Judge Slaughter did not rule on Lyon’s other objections to BGI’s evidence of presentment, which she considered to be moot. Id. The judgment also awarded BGI approximately $15,000 in damages on its breach of contract claim, approximately $30,000 in damages on its fraudulent lien claim, and over $142,000 in attorney’s fees for its fraudulent lien and invalid lien claims, but no attorney’s fees on its breach of contract claim.

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Ted B. Lyon III v. Building Galveston, Inc., (Tex. Ct. App. 2020).

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