John Edward Maher v. PS Texas Holdings, LTD., PS Texas Properties, LTD., and Public Storage, Inc. ( 2010 )

Opinion issued June 3, 2010

In The

Court of Appeals

For The

First District of Texas

NO. 01-09-00783-CV

JOHN EDWARD MAHER, Appellant

V.

PS TEXAS HOLDINGS, LTD., PS TEXAS PROPERTIES, LTD., AND PUBLIC STORAGE, INC., Appellees

On Appeal from the 151st District Court

Harris County, Texas

Trial Court Cause No. 2008-44192

MEMORANDUM OPINION

          The trial court granted summary judgment in favor of PS Texas Holdings, Ltd., PS Texas Properties, Ltd., and Public Storage, Inc. (collectively, “Public Storage”), on John Maher’s claims for breach of contract and for violations of the Self-Storage Lien Act and Deceptive Trade Practices Act.  On appeal, Maher contends that the trial court erred in granting summary judgment on his breach of contract claim because he presented summary judgment evidence that raises a fact issue on whether (1) Maher performed or tendered performance under the contract; (2) Public Storage breached the contract; and (3) Maher incurred damages as a result of Public Storage’s alleged breach.  We hold that Maher’s affidavit raises a fact issue on each of the three challenged elements.  We therefore reverse and remand for further proceedings.

Background

In April 2000, Maher and Public Storage entered into a contract which authorized Maher to use Public Storage’s facilities to store personal property. The contract required Maher to pay monthly rent “without deduction, prior notice, demand or billing statement,” and the agreement continued on a month-to-month basis until terminated by either party.  In addition, if payment is not made by the tenth of the month, the contract provides that Public Storage may assess a ten dollar late fee.  According to Maher, in February 2008, instead of mailing an invoice for the upcoming March rental payment, Public Storage called him as a reminder.  Maher “immediately” mailed Public Storage a check for both March and April rent.

In early April, Maher received an invoice, which included two unpaid late fees on his account.  Maher called Public Storage to resolve the matter, attempting to explain that his last check covered rent for both March and April, but the Public Storage representative was uncooperative and verbally abusive, and told Maher that he would pay what Public Storage told him to pay or it would sell his property.  Two days later, Public Storage locked Maher out of his storage unit, notified him that it had seized and placed a lien on his property, and added a twenty-five dollar lien fee to his account.  Maher continued calling Public Storage throughout April to resolve the dispute, but Public Storage never responded.

After Maher mailed a letter to Public Storage in late April requesting that it contact him to address the dispute, Public Storage notified him of additional late fees and lien fees, stated that it would no longer mail invoices to him, and told Maher that his account was under review for termination.  Public Storage removed a fifty dollar lock Maher had placed on the unit, began charging rent for a courtesy lock, and increased his regular rental rate.  In early July, Public Storage informed Maher that it would sell his property at a public auction on July 24.

On July 23, Maher sued Public Storage for breach of contract and for violations of the Self Storage Lien Act and Deceptive Trade Practices Act, and applied for a temporary restraining order to prevent Public Storage from selling his property.  The trial court granted the restraining order, and Maher hired movers to remove his property from the storage unit.

Public Storage moved for a no-evidence summary judgment on all of Maher’s claims and moved for a traditional summary judgment on its breach of contract counterclaim against Maher.  Public Storage contended that Maher presented no evidence that:  (1) he performed, tendered performance, or was excused from performing his contractual obligations; (2) Public Storage breached the rental agreement; and (3) Maher incurred damages as a result of Public Storage’s conduct.  In support of its traditional summary judgment motion, Public Storage attached the rental agreement with Maher, as well as the “Customer Transaction Journal” for Maher’s account.  The account records demonstrate that Maher missed his March 2008 rental payment and Public Storage assessed a ten dollar late fee.  On March 15, Maher made a double payment of $154, which would ordinarily satisfy his rental obligation for both March and April.  Maher’s payment did not, however, account for the ten dollar late fee.  As a result, as of April 1, Maher had a ten dollar balance and Public Storage charged Maher an additional ten dollar late fee.  Public Storage agreed to write off one of the late fees, and thus at the end of April, its records indicated that Maher still owed Public Storage ten dollars. Maher did not pay rent for May, and after assessing an additional late fee for the May rent, Public Storage also assessed a lien fee on June 1.  Maher also did not pay rent for June or July, when his rental rate increased, and thus at the time Maher obtained the restraining order and removed his possessions from the unit, Public Storage’s records indicated that he owed $296.

In response, Maher relied upon his affidavit and Public Storage’s account records to create a fact issue on the three challenged elements of his breach of contract claim.  Maher contended that the records “affirmatively show[ed]” that Maher was not in default when Public Storage locked him out of the unit because the records reflected that Maher paid his April rent in advance, and the “disputed $10 late fee was resolved in Maher’s favor,” and thus Maher’s April balance was zero.  Maher averred that, as a result of Public Storage’s conduct, he (1) paid fifty dollars for a lock that Public Storage cut off of his unit, (2) hired an attorney to sue Public Storage and obtain a temporary restraining order to prevent the sale of his property, and (3) hired a moving company to remove his property from the storage unit.

The trial court granted summary judgment on all of Maher’s claims in favor of Public Storage.  Public Storage non-suited its counterclaim against Maher for breach of contract and the trial court signed a final order of dismissal.  After the trial court denied Maher’s motion for new trial, Maher appealed the trial court’s grant of Public Storage’s no-evidence summary judgment motion on his breach of contract claim.

Discussion

Standard of Review

          We review de novo the trial court’s ruling on a motion for summary judgment.  Mann Frankfort Stein & Lipp Advisors, Inc. v. Fielding, 289 S.W.3d 844, 848 (Tex. 2009).  After an adequate time for discovery, a party may move for no-evidence summary judgment if no evidence exists of one or more essential elements of a claim or defense on which the adverse party bears the burden of proof at trial. Tex. R. Civ. P. 166a(i); Hamilton v. Wilson, 249 S.W.3d 425, 426 (Tex. 2008).  The trial court must grant a no-evidence summary judgment motion unless the non-movant produces competent summary judgment evidence that raises a genuine issue of material fact on each element specified in the motion.  Tex. R. Civ. P. 166a(i); Mack Trucks, Inc. v. Tamez, 206 S.W.3d 572, 582 (Tex. 2006).  To determine if the non-movant raised a fact issue, we review the evidence in the light most favorable to the non-movant, crediting favorable evidence if reasonable jurors could do so, and disregarding contrary evidence unless reasonable jurors could not.  See Fielding, 289 S.W.3d at 848 (citing City of Keller v. Wilson, 168 S.W.3d 802, 827 (Tex. 2005)).

Maher’s Breach of Contract Claim

          Maher contends that the trial court erred by granting summary judgment because Maher’s affidavit raises a fact issue on the three elements of Maher’s breach of contract claim Public Storage challenges. The essential elements of a breach of contract claim are (1) a valid contract exists; (2) the plaintiff performed or tendered performance; (3) the defendant breached the contract; and (4) the plaintiff incurred damages as a result of the breach.  Bank of Tex. v. VR Elec., Inc., 276 S.W.3d 671, 677 (Tex. App.—Houston [1st Dist.] 2008, pet. denied).  In its no-evidence summary judgment motion, Public Storage acknowledged that a valid contract existed between the parties, but it challenged the remaining three elements of Maher’s breach of contract claim, contending that Maher could not produce evidence that (1) he performed, tendered performance, or was excused from performance; (2) Public Storage breached the contract; and (3) Maher incurred damages as a result of Public Storage’s alleged breach.

          As evidence that Public Storage performed under the rental agreement and Maher breached the contract, Public Storage attached its “Customer Transaction Journal” for Maher’s account.  Public Storage points to these account records as evidence that Maher did not timely pay his rent for March, incurred a late fee as a result, and although Maher ultimately paid rent for both March and April, he never paid the late fee assessed in March, and thus was delinquent under the rental agreement.  If a no-evidence summary judgment motion attaches evidence, the trial court should consider that evidence only if it creates a fact question.  See Binur v. Jacobo, 135 S.W.3d 646, 651 (Tex. 2004).  Maher relied upon Public Storage’s account records in his summary judgment response, contending that the records “affirmatively show that Maher was not in default when Defendants locked him out of his storage space.”  Because Maher’s response relied upon the evidence attached to Public Storage’s traditional motion, this evidence was properly before the trial court, and we may consider this evidence in determining whether Maher raised a fact issue on his performance and Public Storage’s breach of the contractual obligations.

The Public Storage account records indicate that, on February 15, 2008, Public Storage mailed Maher an invoice for the March rental payment, seventy-seven dollars, which he did not timely pay.  As a result, Public Storage assessed a ten dollar late fee.  On March 14, Public Storage called Maher about his March rent and the next day, Public Storage received a check from Maher for $154, equivalent to two months’ rent.  Public Storage applied this check to the March rent and the late fee, and it credited the remaining sixty-seven dollars to Maher’s April rental payment, which left a balance of ten dollars.  Maher did not pay this amount, and as a result, in early April, Public Storage assessed an additional ten dollar late fee and locked Maher out of the unit.  At Maher’s request, Public Storage removed the late fee assessed in April, but a ten dollar balance remained on Maher’s account.  Maher did not make any subsequent payments to Public Storage, and owed Public Storage $296 as of July 11, 2008.

In his summary judgment response, Maher relied upon the account records and stated that the records “affirmatively show that Maher was not in default when [Public Storage] locked him out of his storage space,” because Maher prepaid the April rent and the “disputed $10 late fee was resolved in Maher’s favor.”  In his affidavit, Maher states that, in February 2008, Public Storage failed to mail an invoice for March, but instead called Maher to remind him of his rental payment.  Maher then “immediately” mailed a check for two months’ rent to Public Storage.  During the first week of April, Maher received an invoice indicating two late fees, and after Maher attempted to explain the issue to an uncooperative Public Storage employee, Public Storage locked him out of the unit and placed a lien on his belongings.  Maher’s assertion that he received the phone call in February and “immediately” mailed a check for his March and April rental payments raises a reasonable inference that Maher timely paid rent for March, and conflicts with the Public Storage record which notes that the phone call and payment occurred in mid-March.  Therefore, Maher’s affidavit raises a fact issue that the late fee assessed in March was erroneous, and Maher should not have had a balance on his account on April 1.

On appeal, Public Storage contends that Maher’s “self-serving” and “conclusory” affidavit does not raise a fact issue on any of the challenged elements. An uncontroverted, self-serving affidavit from an interested witness may serve as the basis for granting summary judgment only if the evidence is “clear, positive, direct, otherwise credible, free from contradictions and inconsistencies, and could have been readily controverted.”  Trico Techs. Corp. v. Montiel, 949 S.W.2d 308, 310 (Tex. 1997) (citing Republic Nat’l Leas. Corp. v. Schindler, 717 S.W.2d 606, 607 (Tex. 1986)); Tex. R. Civ. P. 166a(c).  Similarly, an affidavit that states only legal or factual conclusions is not proper summary judgment evidence.  See Rizkallah v. Conner, 952 S.W.2d 580, 587 (Tex. App.—Houston [1st Dist.] 1997, no pet.); Prime Prods., Inc. v. S.S.I. Plastics, Inc., 97 S.W.3d 631, 637 (Tex. App.—Houston [1st Dist.] 2002, pet. denied) (quoting Aldridge v. De Los Santos, 878 S.W.2d 288, 296 (Tex. App.—Corpus Christi 1994, writ dism’d w.o.j.) (holding that affidavits opposing summary judgment motions must set forth facts that would be admissible in evidence).  The affidavit must provide the underlying facts to support the conclusion.  See Rizkallah, 952 S.W.2d at 587; see also Ryland Group, Inc. v. Hood, 924 S.W.2d 120, 122 (Tex. 1996) (per curiam) (“[Conclusory affidavits are neither] credible nor susceptible to being readily controverted.”).

In his affidavit, Maher avers that he performed under the contract and thus Public Storage wrongfully locked him out of the unit.  Maher supports this conclusion with facts:  Public Storage failed to send Maher a March invoice, but instead called him about the rent in February, and Maher immediately mailed a check to Public Storage to cover both March and April rent.  Maher’s affidavit states the facts on which he bases his conclusions and is therefore competent summary judgment evidence.

Maher’s affidavit contradicts Public Storage’s account records, upon which Maher also relies in part.  Those records support Maher’s statement that he made the payment, but differ on the timing of it.  The right answer turns on the credibility of the evidence, placing this dispute within the province of a jury.  When we view the evidence in the light most favorable to Maher, we hold that Maher’s affidavit presents more than a scintilla of evidence that Maher performed under the contract by timely paying his March rental payment.

Public Storage next contends that Maher failed to produce any evidence that Public Storage breached the contract by locking Maher out of his unit because Public Storage had a legal right to lock Maher out of the unit when he became delinquent on his payments.  The rental agreement between Maher and Public Storage provides that Maher defaults if he fails to pay rent or fails to comply with “any term, provision or covenant of this Rental Agreement, other than the payment of rent.”  The rental agreement also provides that Maher “shall have access to [the rental unit].”  Maher’s affidavit creates a fact issue on whether he complied with his contractual obligations.  According to Maher, after he received an invoice in early April indicating two late fees, he contacted Public Storage to explain the problem.  Public Storage acknowledges that it locked Maher out of his unit on April 7, two days after Maher’s alleged attempt to resolve the matter over the phone.  If, as Maher contends, he timely paid his March rent and prepaid his April rent, and thus any late fees assessed by Public Storage were erroneous, Maher was not delinquent on his account when Public Storage locked him out of his unit. Because Maher produced more than a scintilla of evidence that he performed his contractual obligations, we therefore hold that Maher also produced more than a scintilla of evidence that Public Storage breached the rental agreement by wrongfully denying Maher access to the unit when he was not in default.

Public Storage further contends that Maher failed to produce any evidence that he suffered damages as a result of a breach by Public Storage.  Specifically, Public Storage contends that Maher’s “self-serving and conclusory” affidavit does not “rise to a level that would enable reasonable and fair-minded people to differ in their conclusions.” Although Maher’s affidavit does not state the specific amounts that he expended on attorney’s fees and moving costs, Maher states the following:

Public Storage cut off a $50 master lock that I had placed on the storage facility. Thereafter, Public Storage has been charging me rent for a ‘courtesy’ lock.  Public Storage notified me that it intended to sell my personal belongings at public auction to be held on July 24, 2008.  The Defendants would not return telephone calls nor would it respond to the numerous letters that I personally delivered to it.  To prohibit and stop the wrongful conduct of the Defendants, I was required to engage the legal services of a licensed attorney in the state of Texas . . . . As such, to protect my personal property (some of which included heirlooms and professional files), I was required to file a lawsuit and thereafter obtain a Temporary Restraining Order.  Further, I was required to get a court order forcing Public Storage to release my personal property. . . . Further, in order to prevent the defendants from selling my personal property, I was compelled to hire movers on a short-notice basis and pay them to remove my property.

Maher supports his conclusion that he incurred damages as a result of Public Storage’s conduct by specifically stating the actions he took after Public Storage threatened to sell his property.  See Rizkallah, 952 S.W.2d at 587; see also Bowen v. Robinson, 227 S.W.3d 86, 96 (Tex. App.—Houston [1st Dist.] 2006, pet. denied) (stating that normal measure of damages for breach of contract is “just compensation for the loss or damage actually sustained”).

          Public Storage contends that, because Maher did not pay rent for May, June, and July, he “effectively obtained three months of free storage space” and, by obtaining a temporary restraining order, Maher “prevent[ed] Public Storage from exercising its lien rights.”  Maher acknowledges that he did not pay rent for these three months, but asserts that he was excused from paying rent as a result of Public Storage’s breach of the contract by locking Maher out of his unit even though he had performed his contractual obligations.  See Mustang Pipeline Co. v. Driver Pipeline Co., 134 S.W.3d 195, 196 (Tex. 2004) (per curiam) (“It is a fundamental principle of contract law that when one party to a contract commits a material breach of that contract, the other party is discharged or excused from further performance.”).  If the fact-finder determines that Maher performed his contractual obligations and Public Storage materially breached the contract by locking Maher out of his unit, then Maher may assert that he was excused from any further contractual obligations.  Public Storage may also contend that its continued storage minimized any damages resulting from the alleged breach.  Viewing the evidence in the light most favorable to Maher, we hold that Maher raised a fact issue on the damages he incurred as a result of Public Storage’s alleged breach of the rental agreement.

Conclusion

We hold that Maher’s affidavit, presented in response to Public Storage’s no-evidence summary judgment motion, raises a fact issue on Maher’s breach of contract claim.  We therefore reverse and remand for further proceedings.

                                                          Jane Bland

                                                          Justice

Panel consists of Chief Justice Radack and Justices Bland and Sharp.