Roger L. Elliot and Tracy Dehmer v. John Paul Newsom and JPN Properties ( 2009 )

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Opinion issued January 29, 2009

In The

Court of Appeals

For The

First District of Texas

NO. 01-07-00692-CV

ROGER L. ELLIOTT and TRACY DEHMER ELLIOTT, Appellants

V.

JOHN PAUL NEWSOM and JPN PROPERTIES, Appellees

On Appeal from the 234th District Court

Harris County, Texas

Trial Court Cause No. 2006-25991

MEMORANDUM OPINION

   Appellants, Roger L. Elliott and Tracy Dehmer Elliot, appeal from a summary judgment granted in favor of appellees, John Paul Newsom and JPN Properties (collectively "Newsom"). In one issue, the Elliotts contend the trial court erred by rendering summary judgment for Newsom because (1) the Elliotts' deemed admissions could not establish a legal conclusion and (2) evidence contradicting the deemed admissions was admitted without objection. We conclude the trial court erred by rendering summary judgment in favor of Newsom because the deemed admissions could not establish a legal conclusion. We reverse the judgment of the trial court and remand the cause.Background The Elliotts purchased a lot in the Lake Pointe Estates subdivision in Katy. Newsom was the real-estate broker for Lake Pointe Estates. The Elliotts' contract required them to build a house on the lot using an "approved builder." An approved builder was one who agreed, among other things, to pay Newsom a commission equal to four percent of the cost of the house.

The contract states, "See 'Exhibit B,' Paragraph 'D': The Real Estate Brokerage Fee of 4% of the house contract shall survive the closing of the lot." Paragraph D of Exhibit B states,

[Seller] requires all homes constructed in Lake Pointe Estates Subdivision to be built by an approved builder. . . . All approved Builders are required to have an agreement with the Real Estate Broker for Lake Pointe Estates, John Paul Newsom . . . , and to pay a commission of four percent (4%) on the house contract. . . . The undersigned Buyer Understands and Agrees to use the approved Builders.

The Elliotts built a house but did not use an approved builder. Neither the builder nor the Elliotts paid Newsom the four-percent commission. Newsom filed suit for breach of contract. The Elliotts answered the lawsuit pro se, denying they owed Newsom the brokerage fee.

Newsom sent discovery requests to the Elliotts, including the following requests for admissions:

Do you admit or deny that on May 29, 2003 you executed a Property Contract with [Newsom]?

Admit or deny that under the expressed terms of the contract you owe 4% of the house contract as a commission to [Newsom]?

Admit or deny that by not paying the commission at closing you breached the contract terms of the Property Contract that you executed with [Newsom]?

The Elliotts did not respond to the requests for admissions.

Newsom moved for summary judgment based on the deemed admissions and on affidavit testimony. The trial court granted the motion for summary judgment, awarding Newsom $43,564.51, plus pre- and post-judgment interest and costs.

Standard of Review

We review summary judgments de novo. Valence Operating Co. v. Dorsett, 164 S.W.3d 656, 661 (Tex. 2005). Summary judgment is proper only when a movant establishes that there is no genuine issue of material fact and that the movant is entitled to judgment as a matter of law. Tex. R. Civ. P. 166a(c). A motion must state the specific grounds relied upon for summary judgment. Id. In reviewing a summary judgment, we must indulge every reasonable inference in favor of the nonmovant, take all evidence favorable to the nonmovant as true, and resolve any doubts in favor of the nonmovant. Valence Operating Co., 164 S.W.3d at 661.

Analysis In their sole issue in this appeal, the Elliotts contend the trial court erred by basing the summary judgment on their deemed admissions because the admissions are legal conclusions that cannot be used as summary judgment evidence. The Elliotts contend the contract required the builder, not them, to pay the four-percent commission to Newsom.

The primary purpose of requests for admissions is to simplify trials by eliminating matters about which there is no real controversy. Peralta v. Durham, 133 S.W.3d 339, 341 (Tex. App.--Dallas 2004, no pet.); see also Stelly v. Papania, 927 S.W.2d 620, 622 (Tex. 1996). The rule regarding requests for admissions does not contemplate or authorize admissions to questions involving points of law. Gore v. Cunningham, 297 S.W.2d 287, 291 (Tex. Civ. App.--Beaumont 1956, writ ref'd n.r.e.); see also White v. Watkins, 385 S.W.2d 267, 269 (Tex. Civ. App.--Waco 1964, no writ) ("[C]onclusions, opinions, and statements of subjective intent . . . should not be deemed admitted facts."). "[R]esponses to requests for admissions merely constituting admissions of law are not binding on the court . . . ." Boulet v. State, 189 S.W.3d 833, 838 (Tex. App.--Houston [1st Dist.] 2006, no pet.); see also Jackson v. Tex. S. Univ.--Thurgood Marshal Sch. of Law, 231 S.W.3d 437, 440 (Tex. App.--Houston [14th Dist.] 2007, no pet.) (noting "a conclusion of law [is] not subject to judicial admission"); H. E. Butt Grocery Co. v. Pais, 955 S.W.2d 384, 389 (Tex. App.--San Antonio 1997, no pet.) (holding that party may not judicially admit question of law); Fort Bend Cent. Appraisal Dist. v. Hines Wholesale Nurseries, 844 S.W.2d 857, 859 (Tex. App.--Texarkana 1992, writ denied) ("A deemed admission of a purely legal issue is of no effect.").

"Unambiguous contracts are enforced as written." Chapman v. Abbott, 251 S.W.3d 612, 617 (Tex. App.--Houston [1st Dist.] 2007, no pet.) (citing Heritage Res., Inc. v. NationsBank, 939 S.W.2d 118, 121 (Tex. 1996)). The meaning of an unambiguous contract is a question of law. Seagull Energy E & P, Inc. v. Eland Energy, Inc., 207 S.W.3d 342, 345 (Tex. 2006); MCI Telecomms. Corp. v. Tex. Utils. Elec. Co., 995 S.W.2d 647, 650-51 (Tex. 1999).

Here, the contractagreement plainly states that the builders must pay the four-percent commission. The deemed admissions that purport to interpret the agreement in a different way cannot be given effect because they are contrary to the express terms of the agreement. The deemed admission that "by not paying the commission at closing [the Elliotts] breached the contract terms" is a conclusion of law that is not subject to a judicial admission and is therefore of no effect. See Boulet, 189 S.W.3d at 838; Jackson, 231 S.W.3d at 440; H. E. Butt Grocery Co., 955 S.W.2d at 389; Fort Bend Cent. Appraisal Dist., 844 S.W.2d at 859. The deemed admission that "under the expressed terms of the contract [the Elliotts] owe 4% of the house contract as a commission to [Newsom]" is also a conclusion of law that cannot serve as a judicial admission. See Boulet, 189 S.W.3d at 838; Jackson, 231 S.W.3d at 440; H. E. Butt Grocery Co., 955 S.W.2d at 389; Fort Bend Cent. Appraisal Dist., 844 S.W.2d at 859. The only remaining deemed admission admits that the Elliotts entered into the contract, and that admission is insufficient to support the summary judgment. We hold that the trial court erred by basing summary judgment on the deemed admissions.

We need not address the Elliotts' alternative argument that the contract, which was included as summary judgment evidence, contradicts the deemed admissions because it shows the builder must pay the fee rather than the Elliotts, who were required to merely hire an approved builder.

We sustain the Elliotts' sole issue.

Conclusion

We reverse the judgment of the trial court and remand this cause for further proceedings consistent with this opinion.

Elsa Alcala

Justice

Panel consists of Chief Justice Radack and Justices Alcala and Hanks.