Rodrick Dow D/B/A Rodrick Dow PC v. Ruby D. Steward ( 2015 )

Opinion issued January 13, 2015
In The
Court of Appeals
For The
First District of Texas
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NO. 01-13-00806-CV
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RODRICK DOW D/B/A RODRICK DOW P.C., Appellant
V.
RUBY D. STEWARD, Appellee
On Appeal from the County Civil Court at Law No. 4
Harris County, Texas
Trial Court Case No. 977557
MEMORANDUM OPINION
Rodrick Dow d/b/a Rodrick Dow, P.C. (“Dow”), a certified public
accountant, sued Ruby D. Steward to recover $12,000 in unpaid fees for
accounting services. Steward moved for summary judgment on her affirmative
defenses of res judicata and collateral estoppel, arguing that Dow could not prevail
on his suit because the Texas Board of Public Accountancy (“the Board”) had
reprimanded Dow based on his conduct while representing Steward. The trial
court rendered summary judgment in favor of Steward. On appeal, Dow argues
that (1) the trial court’s summary judgment ruling is contrary to the evidence, and
(2) the trial court erroneously refused to allow Dow’s expert witnesses to testify.
We affirm.
Background
In September 2006, Steward, who owned several properties in the Houston
area that she had, at one point, used as rental properties, received notice from the
Internal Revenue Service (“IRS”) that it intended to audit her 2004 tax return. She
hired Dow to represent her before the IRS. As a result of the audit, Steward had to
pay the IRS $887. Steward subsequently filed a complaint against Dow with the
Texas Board of Public Accountancy, alleging that Dow had failed to perform the
professional services for which she had hired him.
While the administrative proceeding against Dow was pending before the
Board, Dow filed the underlying suit against Steward in the Harris County district
court for breach of contract and quantum meruit, seeking recovery of $12,000 in
fees for accounting services rendered to Steward. Steward answered and asserted
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counter-claims against Dow for breach of fiduciary duty, failure to represent,
invasion of privacy, and fraud.
Dow moved for summary judgment on his breach of contract claim. He
argued,
Defendant Ruby Steward hired Plaintiff Rodrick Dow to represent her
in a matter before the Internal Revenue Service, hereinafter referred to
as IRS. Please see exhibit 1. Plaintiff Rodrick Dow represented
Defendant Ruby Steward before the IRS. Please see exhibit 2, IRS’
[“]Case History”, which shows that Plaintiff Rodrick Dow represented
Defendant Ruby Steward before the IRS. In the IRS’ Case History
report, POA is Power of Attorney, which is Rodrick Dow. Ruby
Steward refused to pay a properly submitted invoice. Please see
exhibit 3.
As summary judgment evidence, Dow attached his contract with Steward, an IRS
“Case History Report” that listed the actions that occurred during the audit of
Steward’s 2004 tax return, and a copy of Steward’s unpaid invoice, reflecting that
she owed Dow $12,000.
Steward filed a cross motion for summary judgment on both Dow’s and her
own claims. In this motion, Steward detailed Dow’s actions and omissions during
his representation of her before the IRS. Steward argued that she ought to prevail
on her affirmative defenses of failure to perform a condition precedent, res
judicata, collateral estoppel, and accord and satisfaction. She pointed out that, in
July 2012, the Board “issued to [Dow] a reprimand and suspension, which is
stayed and probated for two years, with [Dow] required to attend additional hours
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of continuing professional development and pay an administrative penalty” due to
Dow’s conduct in representing her. She argued that res judicata and collateral
estoppel should bar Dow’s breach of contract claim because Dow had “the
opportunity to prove a fact issue with respect to a disputed contract amount during
his hearing before the Texas Board of Public Accountancy, an adversarial
proceeding before a tribunal of competent jurisdiction.”
Steward attached the Board’s order and proposal for decision. In that
proceeding, the administrative law judge considered testimony regarding Dow’s
representation of Steward and ultimately concluded that Dow breached his duty of
professional care to Steward. The Board adopted the administrative law judge’s
conclusions, reprimanded Dow, suspended him, although it probated his
suspension for two years, and ordered Dow to complete additional hours of
continuing professional education and to pay an administrative penalty and
administrative costs.
Dow responded to Steward’s summary judgment motion. He argued that he
had satisfactorily represented Steward before the IRS, but he did not attach any
further summary judgment evidence to this response.
In reply, Steward argued:
[Dow] does not refute the totality and specificity of the evidence from
the Texas Board of Public Accountancy that found [him] to have
violated his fiduciary duty as power of attorney, his professional duty
of care, or the underlying fact that he failed to perform the conditions
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of his engagement with [Steward], all of which explicitly prove
[Steward’s] affirmative defenses and her case against [Dow].
[Steward’s] Cross-Motion for Summary Judgment is completely valid
and supported by the weight of facts and law, which stands in stark
contrast to [Dow’s] frivolous and baseless suit, which itself is brought
in bad faith and for the purpose of harassment given [Steward’s]
grievance to the Texas Board of Public Accountancy.
Steward contended that no fact issues existed and that the trial court should grant
her cross-motion for summary judgment. Steward then filed an amended motion
for summary judgment, and she attached evidence reflecting that she had incurred
$14,966 in attorney’s fees.
The day before the summary judgment hearing, Dow responded to Steward’s
amended summary judgment motion, arguing that he had “correctly completed
[Steward’s] tax return and provided excellent IRS representation during
[Steward’s] IRS Audit.” Dow attached letters from two CPAs and affidavits from
two Enrolled Agents, all of whom stated “that the tax return was done correctly
and the IRS Representation was excellent.” Dow also pointed out that he had
appealed the Board’s order against him to the district court in Travis County. The
record does not reflect that Dow obtained leave of court for this late-filed response.
The trial court signed an order denying Dow’s summary judgment motion
and granting Steward’s cross summary judgment motion. The trial court then
signed a final judgment in which it awarded Steward $10,829 in attorney’s fees,
$900 for unjust enrichment, and $887, which represented the amount Steward had
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been required to pay the IRS as a result of the audit. The trial court also rendered a
take-nothing judgment against Dow on his breach of contract claim. This appeal
followed.
Summary Judgment
Although Dow, in his appellate brief, states six issues in his “Issues
Presented” section, he only presents argument on two of them: (1) the trial court’s
summary judgment ruling is contrary to the evidence; and (2) the trial court
erroneously refused to allow Dow’s expert witnesses to testify. 1
A. Standard of Review
When both parties move for summary judgment and the trial court grants
one motion and denies the other, we review both parties’ summary judgment
evidence and determine all questions presented. Valence Operating Co. v. Dorsett,
164 S.W.3d 656, 661 (Tex. 2005); FM Props. Operating Co. v. City of Austin, 22
S.W.3d 868, 872 (Tex. 2000). Each party bears the burden of establishing that it is
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Dow states his six issues presented as follows: (1) “[w]hether Appellant
performed duties Appellee hired Appellant to perform”; (2) “[w]hether Appellant
did anything to cost Appellee any monetary harm”; (3) “[w]hether Attorney fees
granted were excessive”; (4) “[w]hether the evidence presented by Appellant
should have been allowed into evidence by the trial court”; (5) “[w]hether Trial
Judge should have allowed Appellant to speak in court”; and (6) “[w]hether the
evidence presented was sufficient to uphold a summary judgment.” To the extent
Dow raises issues in his appellate brief but does not provide any argument,
authorities, or record cites to support his contentions, we hold that he has not
adequately briefed those issues. See TEX. R. APP. P. 38.1(i) (“The brief must
contain a clear and concise argument for the contentions made, with appropriate
citations to authorities and to the record.”).
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entitled to judgment as a matter of law. City of Santa Fe v. Boudreaux, 256
S.W.3d 819, 822 (Tex. App.—Houston [14th Dist.] 2008, no pet.); see also TEX. R.
CIV. P. 166a(c) (“The judgment sought shall be rendered forthwith if . . . 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.”). If we determine that the trial court erred, we render the
judgment that the trial court should have rendered. Dorsett, 164 S.W.3d at 661;
FM Props., 22 S.W.3d at 872.
If the trial court’s order does not specify the grounds for its summary
judgment ruling, we affirm the ruling if any of the theories presented to the trial
court and preserved for appellate review are meritorious. Provident Life &
Accident Ins. Co. v. Knott, 128 S.W.3d 211, 216 (Tex. 2003). When a party
presents multiple grounds for summary judgment and the order does not specify
the ground on which the trial court rendered summary judgment, the appellant
must negate all grounds on appeal. Ellis v. Precision Engine Rebuilders, Inc., 68
S.W.3d 894, 898 (Tex. App.—Houston [1st Dist.] 2002, no pet.) (citing State Farm
Fire & Cas. Co. v. S.S., 858 S.W.2d 374, 381 (Tex. 1993)); see also Britton v. Tex.
Dep’t of Criminal Justice, 95 S.W.3d 676, 681 (Tex. App.—Houston [1st Dist.]
2002, no pet.) (“Generally speaking, an appellant must attack all independent bases
or grounds that fully support a complained-of ruling or judgment.”). “If summary
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judgment may have been rendered, properly or improperly, on a ground not
challenged, the judgment must be affirmed.” Ellis, 68 S.W.3d at 898.
B. Propriety of Summary Judgment Ruling
Here, in her cross-motion for summary judgment, Steward argued that three
affirmative defenses precluded summary judgment in Dow’s favor on his cause of
action for breach of contract: (1) Dow’s failure to perform a condition precedent,
specifically, his failure to adequately represent Steward before the IRS; (2) res
judicata and collateral estoppel as a result of the administrative proceeding before
the Board in which the Board reprimanded Dow, probated a suspension, and
required him to pay administrative penalties as a result of his representation of
Steward; and (3) accord and satisfaction.
The trial court’s order granting Steward’s cross-motion for summary
judgment and denying Dow’s summary judgment motion does not state the basis
for the court’s summary judgment ruling. Dow does not challenge any of these
three grounds on appeal. We therefore conclude that because Dow has not negated
all possible grounds for the trial court’s summary judgment ruling on appeal, we
must affirm the trial court’s ruling. See Britton, 95 S.W.3d at 681; see also
Malooly Bros., Inc. v. Napier, 461 S.W.2d 119, 121 (Tex. 1970) (“The judgment
must stand, since it may have been based on a ground not specifically challenged
by the plaintiff and since there was no general assignment [of error on appeal] that
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the trial court erred in granting summary judgment.”); Ellis, 68 S.W.3d at 898
(noting, in affirming summary judgment when appellant did not challenge on
appeal both grounds presented to trial court, that appellant had not “asserted a
general point of error that the trial court erred in rendering summary judgment
against him”).
To the extent that Dow’s argument on appeal that the evidence presented
was not sufficient to support the trial court’s summary judgment ruling can be
construed as a general assignment of error on appeal, we hold that the trial court’s
summary judgment ruling can be supported on collateral estoppel grounds.
A party seeking to assert collateral estoppel must establish that (1) the facts
sought to be litigated in the second action were fully and fairly litigated in the first
action; (2) those facts were essential to the judgment in the first action; and (3) the
parties were cast as adversaries in the first action. Turnage v. JPI Multifamily,
Inc., 64 S.W.3d 614, 617 (Tex. App.—Houston [1st Dist.] 2001, no pet.) (quoting
Sysco Food Servs., Inc. v. Trapnell, 890 S.W.2d 796, 801 (Tex. 1994)). Collateral
estoppel applies to administrative agency orders “when the agency is ‘acting in a
judicial capacity and resolves disputed issues of fact properly before it which the
parties have had an adequate opportunity to litigate.’” Id. at 620 (quoting
Muckelroy v. Richardson Indep. Sch. Dist., 884 S.W.2d 825, 830 (Tex. App.—
Dallas 1994, writ denied)).
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Here, after the IRS audited Steward’s 2004 tax return, Steward filed a
complaint against Dow with the Board concerning his representation of her before
the IRS. The parties both participated and submitted extensive evidence in a
contested case hearing before an administrative law judge. The administrative law
judge ultimately concluded that Dow breached his duty of professional care in
representing Steward. The Board issued an order adopting the administrative law
judge’s findings of fact and conclusions of law, and, based on those findings and
conclusions, it reprimanded Dow, placed him on probated suspension for two
years, ordered him to complete additional continuing education, and required him
to pay administrative penalties and costs. Thus, the agency, acting in a judicial
capacity, already resolved issues concerning the adequacy of Dow’s representation
of Steward.
Assuming that Dow properly preserved a general assignment of error in the
trial court’s judgment in favor of Steward, we conclude that the trial court could
have properly rendered summary judgment in favor of Steward based on collateral
estoppel grounds. See Turnage, 64 S.W.3d at 617.
C. Erroneous Exclusion of Evidence
Dow also argues that the trial court erroneously refused to allow his
supporting expert witnesses to testify.
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We first note that trial courts are not to receive oral testimony during
hearings on summary judgment motions. See TEX. R. CIV. P. 166a(c) (“No oral
testimony shall be received at the [summary judgment] hearing.”); Kennedy Con.,
Inc. v. Forman, 316 S.W.3d 129, 134 (Tex. App.—Houston [14th Dist.] 2010, no
pet.) (“Trial courts are not to receive oral testimony during summary-judgment
hearings.”); see also Imkie v. Methodist Hosp., 326 S.W.3d 339, 343 (Tex. App.—
Houston [1st Dist.] 2010, no pet.) (stating same). The trial court, therefore, did not
err in refusing to allow Dow’s experts to testify at the summary judgment hearing.
We now consider whether the trial court erred in refusing to consider letters
and affidavits from Dow’s experts, two CPAs and two Enrolled Agents, all of
whom stated that they had reviewed Dow’s work in representing Steward and that
Dow prepared Steward’s 2004 tax return correctly and provided “excellent”
representation. Dow attached these letters and affidavits as summary judgment
evidence to his response to Steward’s amended summary judgment motion.
Rule 166a(c) provides, “Except on leave of court, the adverse party, not later
than seven days prior to the day of the hearing may file and serve opposing
affidavits or other written response.” TEX. R. CIV. P. 166a(c); Neimes v. Ta, 985
S.W.2d 132, 138 (Tex. App.—San Antonio 1998, pet. dism’d). “Rule 166a(c)
‘specifically places the burden on the [respondent] to obtain leave of court to file a
late response.’” Neimes, 985 S.W.2d at 138. If a party wishes to have his late-
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filed response considered, he is required to obtain the trial court’s permission to
file it late. Id. at 139. If the record does not contain an indication that the trial
court considered a late-filed response, “we must presume the trial court did not
consider it and we must do likewise.” Id. at 138; see 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.”); INA of
Tex. v. Bryant, 686 S.W.2d 614, 615 (Tex. 1985) (“Bryant’s response to INA’s
motion for summary judgment was not timely filed, and nothing appears of record
to indicate that the late filing was with leave of court. Therefore, we must presume
that the trial court did not consider it in rendering a take nothing judgment in favor
of INA.”).
Dow filed his response and the summary judgment evidence from his
experts on February 14, 2013, one day before the hearing on the summary
judgment motions. Thus, he did not timely file this evidence. See TEX. R. CIV. P.
166a(c); Neimes, 985 S.W.2d at 138. There is no indication in the record that Dow
obtained leave of court to file this late response. The trial court’s summary
judgment order does not recite that it considered late-filed evidence. Because the
record does not indicate that the trial court granted leave to late-file this evidence
or that the trial court considered the evidence in rendering summary judgment, we
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presume that the trial court did not consider the evidence. See Neimes, 985 S.W.2d
at 138; see also BP Am. Prod. Co. v. Zaffirini, 419 S.W.3d 485, 509 (Tex. App.—
San Antonio 2013, pet. denied) (“If a response is filed late, we presume the trial
court did not consider it unless there is an affirmative indication in the record that
the trial court granted leave to file the response.”). Dow, as the party late-filing
summary judgment evidence, had the responsibility to obtain permission from the
trial court if he wished to have the court consider his late-filed evidence. See
Neimes, 985 S.W.2d at 139. Because Dow did not obtain permission to late-file
his evidence, the evidence was not properly before the trial court, and the trial
court did not err in refusing to consider the evidence. See Benchmark Bank, 919
S.W.2d at 663.
We hold that the trial court properly granted Steward’s cross-motion for
summary judgment.
Conclusion
We affirm the judgment of the trial court.
Evelyn V. Keyes
Justice
Panel consists of Justices Keyes, Higley, and Brown.
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