the Discovery Group, Incorporated D/B/A Preferred Corporate Housing v. Richard Kammen, Individually and Dba Richard Kammen & Associates

Court of Appeals of Texas·Decided November 19, 2015·No. 01-15-00243-CV·Published

Opinion

Opinion issued November 19, 2015.

In The

Court of Appeals

For The

First District of Texas

[“PCH”], as landlord, to Richard Kammen, individually, and d/b/a Richard Kammen & Associates, as tenant. PCH sued Kammen, asserting a breach of contract cause of action, alleging that Kammen failed to pay the last three months’ rent due under the lease. Kammen counterclaimed, alleging among other things that the suit was time barred and that PCH failed to mitigate its damages. Kammen also claimed that he was entitled to reasonable attorney fees for defending the suit. Kammen filed a motion for summary judgment, based on his statute of limitations affirmative defense. The trial court granted summary judgment in Kammen’s favor, ruling that PCH takes nothing on their claim and awarding Kammen attorney’s fees. On appeal, PCH brings four issues challenging the trial court’s summary judgment. We affirm in part and reverse and remand in part.

BACKGROUND

Kammen, an Indiana resident, entered into an agreement with PCH, a Texas corporation, to lease an apartment from December 30, 2008 to May 31, 2009. The terms contemplated rental of the premises for use as a temporary residence while Kammen was in trial in Tennessee, where the apartment is located. Rent was to be paid monthly, at a rate of $3,345.00, and was due on or before the first of each month. The lease provides the following provision regarding lease extensions and move-out procedures:

Lessee(s) is responsible for the rent for the full Term and is responsible for the rent through the notice period. In the event that

Lessee(s) need to terminate the Lease before the expiration of the Term, Lessee(s) may pay an 85% reletting fee of the monthly rent to cover PCH’s expenses in attempt to release the Apartment. The reletting charge is not a cancellation fee and does not release Lessee(s) from the obligations under this Lease. The reletting charge does not release you from your continued liability for: future or past-

due-rents; charges for damages; or other sums due. Lessee(s) move out notice cannot terminate the Lease prior to the end of the Term or renewal period.

Kammen failed to pay rent for the months of March, April, and May of 2009. On April 11, 2012, PCH, through its agent, sent Kammen a demand letter whereby PCH states that “[w]e are responsible for the remaining 3 months to fulfill the term through 5/31/09 with the property, therefore we have to pass the cost that we incurred from the property to break the lease.” The letter seeks “the full cancellation cost” of breaking the lease and attaches an invoice. The Invoice further identifies the costs from March 1, 2009 through May 31, 2009 as “cancellation costs.”

PCH filed suit March 28, 2013. Kammen filed his First Amended Motion for Summary Judgment, alleging that PCH’s suit was time barred. He also contended that the tolling provisions relied on by PCH in its petition were inapplicable, and that he was entitled to attorney’s fees. The trial judge sustained Kammen’s objections to the evidence attached to PCH’s response and struck Exhibits 1-A, 1- B, 1-C, and 1-D as not being properly authenticated and as inadmissible hearsay. The judge also struck sections of PCH’s affidavit. The trial judge granted

Kammen’s motion for summary judgment based on the affirmative defense that the claim was barred as it was outside the statute of limitations.

STATUTE OF LIMITATIONS

PCH complains in its first issue that the trial court erred by granting summary judgment on the basis of limitations. Kammen contends, both in his summary judgment and on appeal, that the limitations period began to run on March 1, 2009—the date that the first months’ rent went unpaid. PCH argues that Kammen breached the contract each time rent was due, but not paid, i.e., on March 1, April 1, and May 1 of 2009. Although PCH concedes the suit was “arguably” outside the statute of limitations for the breach on March 1, 2009, but argues that the April 1 and May 1 breaches were timely. And, as to the March 1, 2009 breach, PCH pleaded both statutory and equitable tolling. Standard of Review This is an appeal from a summary judgment. The standards for reviewing a motion for summary judgment are well established. Rule 166a provides a method of summarily terminating a case when it clearly appears that only a question of law is involved and that there is no genuine fact issue. See Swilley v. Hughes, 488 S.W.2d 64, 68 (Tex. 1972). The party moving for summary judgment carries the burden of establishing that no material fact issue exists and that it is entitled to judgment as a matter of law. See TEX. R. CIV. P. 166a(c); Wornick Co. v. Casas,

856 S.W.2d 732, 733 (Tex. 1993); Nixon v. Mr. Property Mgt. Co., 690 S.W.2d 546, 548 (Tex. 1985); Calvillo v. Gonzalez, 922 S.W.2d 928, 929 (Tex. 1996). The nonmovant has no burden to respond to a summary judgment motion unless the movant conclusively establishes its cause of action or defense. See Oram v. General Am. Oil Co., 513 S.W.2d 533, 534 (Tex. 1974); Swilley, 488 S.W.2d at 67–68. The trial court may not grant summary judgment by default because the nonmovant did not respond to the summary judgment motion when the movant’s summary judgment proof is legally insufficient. See City of Houston v. Clear Creek Basin Auth., 589 S.W.2d 671, 678 (Tex. 1979). The movant must establish its right to summary judgment on the issues expressly presented to the trial court by conclusively proving all elements of the movant’s cause of action or defense as a matter of law. See Walker v. Harris, 924 S.W.2d 375, 377 (Tex. 1996); Centeq Realty, Inc. v. Siegler, 899 S.W.2d 195, 197 (Tex. 1995); City of Houston, 589 S.W.2d at 678.

When, as here, a defendant moves for summary judgment on the affirmative defense of limitations it has the burden to conclusively establish that defense. See Velsicol Chem. Corp. v. Winograd, 956 S.W.2d 529, 530 (Tex. 1997). When summary judgment is sought on limitations, it is also the movant’s burden to negate the applicability of a tolling or suspension statute raised by the nonmovant. Zale Corp. v. Rosenbaum, 520 S.W.2d 889, 891 (Tex. 1975); Medina v. Tate, 438

S.W.3d 583, 586 (Tex. App.—Houston [1st Dist.] 2013, no pet.). A trial court’s ruling on a summary judgment motion is reviewed de novo. Travelers Ins. Co. v. Joachim, 315 S.W.3d 860, 862 (Tex. 2010). Summary judgments must stand on their own merits. Rhone-Poulenc, Inc. v. Steel, 997 S.W.2d 217, 223 (Tex. 1999). When reviewing a summary judgment, we take as true all evidence favorable to the nonmovant. See Science Spectrum, Inc. v. Martinez, 941 S.W.2d 910, 911 (Tex. 1997); Friendswood Dev. Co. v. McDade & Co., 926 S.W.2d 280, 282 (Tex. 1996); Wornick, 856 S.W.2d at 733. We indulge every reasonable inference and resolve any doubts in the nonmovant’s favor. See Science Spectrum, 941 S.W.2d at 911; Friendswood Dev., 926 S.W.2d at 282; Wornick, 856 S.W.2d at 733; Nixon, 690 S.W.2d at 548–49. On appeal, the movant still bears the burden of showing that there is no genuine issue of material fact and that the movant is entitled to judgment as a matter of law. See Nixon, 690 S.W.2d at 548. The evidence raises a genuine issue of fact if reasonable and fair-minded jurors could differ in their conclusions in light of all of the summary-judgment evidence. Goodyear Tire & Rubber Co. v. Mayes, 236 S.W.3d 754, 755 (Tex. 2007). Analysis An agreement to lease an apartment is a contract, and a breach thereof falls within the four-year statute of limitations. TEX. CIV. PRAC. & REM. CODE ANN. § 16.004. Rule 166a(c) clearly requires that Kammen, as the moving party, has the

burden to establish that no material fact issue exists regarding the statute of limitations and that he is entitled to judgment as a matter of law. See TEX. R. CIV. P. 166a(c).

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