Comprehensive Leasing Corporation Gaylan Davis And Tony Davis v. American Network Leasing Corporation ( 1995 )

Davis v. American Leasing TEXAS COURT OF APPEALS, THIRD DISTRICT, AT AUSTIN



NO. 03-93-00637-CV



Comprehensive Leasing Corporation; Gaylan Davis; and Tony Davis, Appellants

v.

American Network Leasing Corporation, Appellee





FROM THE DISTRICT COURT OF TRAVIS COUNTY, 250TH JUDICIAL DISTRICT NO. 475,109, HONORABLE JERRY DELLANA, JUDGE PRESIDING

Appellants Gaylan and Tony Davis appeal from a summary judgment rendered in favor of appellee American Network Leasing Corporation ("American"). The Davises contend that the district court erred in granting summary judgment for American and in awarding American attorney's fees and expenses. We will affirm the trial court's judgment.

BACKGROUND

In February 1987, American and Comprehensive Leasing Corporation ("Comprehensive") executed a partnership agreement to lease equipment. Under the agreement, American held a ninety-nine percent partnership interest and was to contribute ninety-nine percent of the partnership's capital. Comprehensive held a one percent partnership interest and was to manage partnership leases by invoicing lessees and handling collection of delinquent accounts. American was to receive ninety-five to ninety-seven percent of the lease proceeds and Comprehensive was to receive three to five percent. Gaylan Davis was president and sole shareholder of Comprehensive; her husband, Tony Davis, was Comprehensive's general manager. Between February 12, 1987 and February 7, 1990, the partnership purchased and leased approximately $40,000,000 worth of equipment.

Under a separate agency agreement, Comprehensive agreed to serve as the partnership's agent in the acquisition of leases in return for a "lease origination fee" on every lease acquired. Comprehensive also guaranteed the performance of lessee rent obligations; it agreed to make timely payments to the partnership for all leases, regardless of whether it had received payment, and it agreed to buy back delinquent leases. Each Davis signed a personal guaranty for Comprehensive in the event it defaulted on its payment obligations under the partnership and agency agreements.

American alleges that during the summer and fall of 1989, Comprehensive became delinquent in remitting American's portion of rental payments. Comprehensive requested an accounting by an independent CPA firm to determine the correct amount owed to American, but the accounting did not occur. In any event, Comprehensive failed to tender any payment to American in November 1989. American notified Comprehensive on November 21, 1989, that failure to pay amounts allegedly due by November 24 would constitute an "event of default" entitling American to exercise all remedies set forth in the partnership agreement.

On November 22, 1989, Comprehensive filed suit seeking an injunction against American's takeover of the lease portfolio. American filed a counter-claim alleging Comprehensive's breaches of contract and fiduciary duty. American also filed applications for a temporary restraining order and a temporary injunction. The district court denied Comprehensive's requested temporary injunction and ordered American's takeover of the lease portfolio. On February 7, 1990, American terminated its partnership with Comprehensive. On March 13, 1990, American amended its counter-claim to add the Davises as defendants, asserting claims based on their personal guaranties and breaches of fiduciary duty.

As the lawsuit progressed, both Comprehensive and Tony Davis failed to comply with rules of discovery and court orders. Consequently, on June 26, 1990, the trial court ordered sanctions (the "Sanctions Order") striking the pleadings, claims, and defenses of Comprehensive and Tony Davis and deeming admitted all allegations made against them in American's amended counter-claim. Comprehensive then filed a petition for bankruptcy and removed the case to federal court. The bankruptcy court severed and remanded American's claims against the Davises to the Travis County district court. On June 6, 1991, American obtained an interlocutory judgment by default against Tony Davis.

American filed a motion for summary judgment on July 16, 1992, which addressed Gaylan Davis's liability and American's entitlement to damages from both the Davises. After a hearing, the court granted American's motion for summary judgment and awarded American damages of $14,520,401.25, court costs and interest. The Davises appeal the trial court's judgment, asserting seven points of error.

DISCUSSION

I.  Summary Judgment

A movant for summary judgment must establish that there is no genuine issue of material fact and that it is entitled to judgment as a matter of law. Nixon v. Mr. Property Management Co., 690 S.W.2d 546, 548 (Tex. 1985). All evidence favorable to the nonmovants will be taken as true; every reasonable inference must be indulged in favor of the nonmovants and any doubts resolved in their favor. Id. at 548-49.

Both the movant and nonmovants must present the issues and arguments upon which they rely in their respective summary judgment motions and responses to the trial court. McConnell v. Southside Indep. Sch. Dist., 858 S.W.2d 337, 341 (Tex. 1993). The movant meets its burden by providing summary judgment evidence conclusively proving as a matter of law each element of the legal theory on which it seeks recovery. City of Houston v. Clear Creek Basin Auth., 589 S.W.2d 671, 678 (Tex. 1979). The nonmovants' presentment of proof of existing fact issues will defeat the movant's right to summary judgment. Id. at 679. The non-movants may also avoid summary judgment by raising a material fact issue as to each of the elements of their asserted affirmative defenses. Brownlee v. Brownlee, 665 S.W.2d 111, 112 (Tex. 1984); Pentad Joint Venture v. First Nat'l Bank, 797 S.W.2d 92, 95 (Tex. App.--Austin 1990, writ denied).

In their first and second points of error, the Davises argue that the trial court erred in granting American's motion for summary judgment. ⁽¹⁾ They contend that genuine issues of material fact exist as to American's entitlement to any relief pursuant to the Davises' guaranty agreements.

A guarantor's liability is measured by the principal's liability. Hercules Exploration, Inc. v. Halliburton Co., 658 S.W.2d 716, 724 (Tex. App.--Corpus Christi 1983, writ ref'd n.r.e.). Tony Davis's liability as guarantor had been established through the Sanctions Order. ⁽²⁾ To prove Gaylan Davis's liability as guarantor, American had to produce summary judgment evidence establishing Gaylan Davis's execution of a guaranty of Comprehensive's obligations, Comprehensive's breach of its obligations, Comprehensive's liability for its breach, and American's damages resulting from Comprehensive's breach.

The summary judgment record contains a guaranty agreement signed by Gaylan Davis, ⁽³⁾ as well as the Sanctions Order establishing American's allegations against Comprehensive. The Sanctions Order provided that

4. All facts alleged by American in its Second Amended Counterclaim and Applications for Temporary Restraining Order and Temporary Injunction herein against Comprehensive . . . shall be taken as established for the purposes of this action; . . . .

. . . .

6. Comprehensive . . . [is] hereby precluded from raising any matters in defense and from otherwise opposing or defending against any of the claims asserted against [it] . . . by American herein . . . .

7. American shall be permitted to take a judgment by default against Comprehensive . . . .

(Emphasis added). Thus, the summary judgment evidence established Comprehensive's liability to American and established Gaylan Davis's guaranty of Comprehensive's obligations.

Responding to American's summary judgment evidence, the Davises contend Gaylan Davis executed a second guaranty, which replaced and superseded the first. This contention is in the nature of an affirmative defense: Gaylan Davis admits the existence of the first guaranty but attempts to be released from liability by alleging the existence of a second agreement. She argues that because the second guaranty may differ from the first, it could constitute a material alteration discharging her liability under the first agreement. Her contention fails.

When nonmovants assert an affirmative defense in their response to a motion for summary judgment, they must present competent summary judgment evidence sufficient to raise a fact issue on each element of the affirmative defense in order to avoid summary judgment. Brownlee, 665 S.W.2d at 112. The Davises have neither offered the alleged second guaranty as summary judgment proof nor alleged that the second guaranty materially altered the first. Rather, they contend the second guaranty might have differed from the first in such a way that it discharged Gaylan Davis's liability under the first agreement. Speculation and conclusions, as opposed to "factual matters such as the time, place, and exact nature of the alleged modification," are insufficient to raise an issue of fact and will not preclude summary judgment. Id. (holding that statement alleging actual modification to previous contractual obligation, without more factual evidence, was legal conclusion and insufficient to raise fact issue to avoid summary judgment). Moreover, the execution of a later guaranty does not automatically discharge a guarantor's obligations under the first. See Federal Deposit Ins. Corp. v. Attayi, 745 S.W.2d 939, 947 (Tex. App.--Houston [1st Dist.] 1988, no writ); Warner v. First Nat'l Bank, 369 S.W.2d 651, 652-53 (Tex. Civ. App.--San Antonio 1963, no writ) ("For a guarantor to be released from liability by a subsequent guaranty, it must appear that the later guaranty was intended and accepted as a substitute for the former . . . .").

The Davises additionally argue that the trial court erred in granting summary judgment to American because genuine issues of material fact exist regarding the amount of damages, if any, for which the Davises are liable under their personal guaranties. The Davises contend that the affidavit of John A. Cawyer, American's supervisor of financial analysis, failed to establish the amount of American's damages and that the affidavits of T. Hardie Bowman, Ken Messner, and Gaylan Davis controvert Cawyer's affidavit, clearly creating a genuine issue of material fact regarding damages. We disagree.

Cawyer stated in his affidavit that American "expected" the sum of $13,243,595 from Comprehensive as of April 30, 1992. The Davises argue that this statement is legally insufficient to form the basis of a damage award because Cawyer did not also aver that the amount "expected" was accurate or that the "expected" payment had not been received. Contrary to the Davises' contentions, Cawyer's affidavit indicates that the "expected" payment had not been received; Cawyer stated that his data "reflects the amount of cash expected from Comprehensive (i.e. the amount of the lease proceeds that [Comprehensive] should have paid American under the Partnership and Agent Agreements) and the actual cash received by American." (Emphasis added).

Cawyer's affidavit details his calculation of Comprehensive's debt from American's monthly bank deposit reports. The reports indicate the percentage of rent due American under each lease--the sum American "expected." The reports also show the funds actually deposited with American by Comprehensive--the sums American "received." The difference between amounts expected and amounts received equals Cawyer's calculated sum owed by Comprehensive or its guarantors to American under the partnership and agent agreements. We conclude that Cawyer's affidavit and accompanying exhibits constitute competent summary judgment evidence establishing American's damages.

The Davises attempt to controvert Cawyer's affidavit by claiming entitlement to an offset against the amount due American. They allege American is unfairly claiming payment from Comprehensive for leases sold to American's financing source, Receivables Capital Corporation ("RCC"). ⁽⁴⁾ However, Barbara Luzzato, senior vice-president of American until March 31, 1992, testified to the following by affidavit:

None of the leases involved in the . . . [RCC] [t]ransaction are leases giving rise to American's claims in this action. American is suing the Davises as guarantors of Comprehensive's obligations, and Comprehensive's guaranty obligations do not extend to leases not in default. . . . [N]o lease in default was involved in the . . . [RCC] [t]ransaction.

(Emphasis added). The Davises have failed to present any summary judgment evidence controverting Luzzato's statement or establishing that leases in default were involved in the RCC transactions. ⁽⁵⁾

The Davises further attempt to controvert American's evidence of damages with affidavit statements from Bowman, Messner, and Gaylan Davis. Bowman, Comprehensive's chief financial officer from August 20, 1989 to June 30, 1990, testified that Comprehensive's past lease payment delinquencies were "minuscule" when compared to the amount claimed due by Cawyer. He stated that American's accounting system and records on partnership leases were "fraught with errors" and he "strongly disagree[d]" that the sum owed was $13.9 million. Messner, a private consultant employed by Comprehensive in October 1989 to compare American's database with Comprehensive's, reported in a memorandum attached to his affidavit that his comparison uncovered "several thousand errors." The report attached to Messner's affidavit states that some of these errors directly contributed to the amount American's bank deposit reports showed Comprehensive owed. Gaylan Davis avers that after accounting discrepancies were uncovered, she offered to pay all amounts rightfully owed as determined in an accounting by a Big Eight accounting firm; this accounting never took place.

Affidavits are competent summary judgment evidence if they are made on personal knowledge, set forth facts admissible in evidence, and show affirmatively that the affiant is competent to testify to the matters stated therein. Brownlee, 665 S.W.2d at 112. Affidavits consisting of legal conclusions are not competent summary judgment evidence to raise fact issues. Anderson v. Snider, 808 S.W.2d 54, 55 (Tex. 1991); Brownlee, 665 S.W.2d at 112; Mercer v. Daoran Corp., 676 S.W.2d 580, 583 (Tex. 1984). Neither are statements of belief rather than fact. Trans-Continental Fin. Corp. v. Summit Nat'l Bank, 761 S.W.2d 575, 577 (Tex. App.--Fort Worth 1988, no writ). Affidavit statements must be so direct and unequivocal that perjury can be assigned against the affiant if the statements are untrue. Id.

The statements offered by the Davises raise no fact issue. Bowman's affidavit fails to present facts identifying the alleged accounting system errors or supporting his belief that Comprehensive owed a lesser sum than that established by American. His affidavit merely presents his statement of disagreement with Caywer's sum and his conclusion that American's accounting system was "fraught with errors." As such, the statements in Bowman's affidavit do not constitute competent summary judgment evidence to controvert American's evidence. See Snider, 808 S.W.2d at 55; Brownlee, 665 S.W.2d at 112.

Messner's statements in the documents accompanying his affidavit indicate "several thousand errors were identified" when the databases of Comprehensive and American were compared. The report attached to Messner's affidavit states that over fifteen hundred leases listed in American's records lacked cross-references matching leases in Comprehensive's records; that American had failed to timely pay lease origination fees to Comprehensive on over eighteen hundred leases; that other errors in stream fees, equipment costs, and customer lease payments had been identified; and that these errors directly contributed to the difference in the amount the two companies thought Comprehensive owed American. However, neither Messner's report nor his affidavit quantifies the alleged errors or indicates how any error contributed to the amount owed. Furthermore, at no point does Messner's affidavit or report show that Comprehensive owed less than the judgment amount. Even if we attribute all of the several thousand unquantified errors to American and assume that the errors negatively impacted the sums Comprehensive owed to American in 1989, Messner's affidavit and report contain only conclusory statements and present nothing to controvert the accuracy of Cawyer's calculations at the time American submitted its motion for summary judgment in 1992.

Gaylan Davis's affidavit fails to raise a genuine issue of material fact concerning proof of damages; her offer to pay all amounts rightfully due and her request for an accounting have no bearing on the issue. The affidavit statements and offset arguments submitted by the Davises fail to controvert the proof American offered on the amount due under the Davises' guaranties. We overrule the Davises' first and second points of error.

In their sixth point of error, the Davises contend that the trial court erred in awarding damages for American's payment of sales, use, and property taxes on the partnership's property because the award was not based on competent evidence. In particular, the Davises contend that the affidavit of American's property tax manager, Wendy Tangman, contained inadmissible hearsay. Assuming without deciding that the affidavit contained inadmissible hearsay, we conclude the Davises waived the hearsay objection by their failure to obtain a ruling from the trial court on this objection. See Eads v. American Bank, N.A., 843 S.W.2d 208, 211 (Tex. App.--Waco 1992, no writ).

The Davises further contend that summary judgment evidence on this issue was not competent because the property tax bills should have been attached to Tangman's affidavit and because Tangman used an estimate in her calculations. These contentions are meritless. In her affidavit, Tangman summarized the voluminous tax records previously available to the Davises, Tex. R. Civ. Evid. 1006, and stated the amount American paid on behalf of the partnership for 1989 property taxes. We overrule the Davises' sixth point of error.

II.  Affirmative Defenses

In points of error four and five, the Davises argue that the trial court erred in granting summary judgment in favor of American because genuine issues of material fact exist as to (1) Gaylan Davis's affirmative defenses of equitable estoppel, fraud, breach of fiduciary duty, breach of the duty of good faith and fair dealing, unclean hands, offset, tortious interference, breach of contract, failure to mitigate damages, and negligence; and (2) whether a defect of parties existed.

The Davises assert that Gaylan Davis, as a guarantor, may raise affirmative defenses available to the obligor if the obligor is included, as Comprehensive was, in the lawsuit against the guarantor. See Hart v. First Fed. Sav. & Loan Ass'n, 727 S.W.2d 723, 725 (Tex. App.--Austin 1987, no writ) (noting equity allows guarantor to assert debtor's cause of action as a set-off of claim against it if guarantor and debtor are joined in suit). We assume all of Gaylan Davis's affirmative defenses thus relate to her liability as guarantor. However, because Comprehensive's liability was conclusively established by the Sanctions Order, Gaylan Davis, as guarantor, is now estopped to assert Comprehensive's defenses to liability. A guarantor in control of her principal is estopped to relitigate the principal's liability once established. Mayfield v. Hicks, 575 S.W.2d 571, 574 (Tex. Civ. App.--Dallas 1978, writ ref'd n.r.e.).

[A] judgment against the principal obligor conclusively establishes the extent of the principal's liability with respect to a guarantor, if that judgment is obtained in a suit of which the guarantor had full knowledge and an opportunity to defend. . . . [This rule applies] where the primary obligor's liability had been established in an action where the guarantor had an opportunity to defend but either did not do so or did so unsuccessfully . . . . [B]efore collateral estoppel applies, the opportunity to defend must be such that the guarantor can actually control the suit with respect to any defenses including those available to the primary obligor.

Id; see also Trinity Universal Ins. Co. v. Briarcrest Country Club Corp., 831 S.W.2d 453, 455 (Tex. App.--Houston [14th Dist.] 1992, writ denied) (applying Mayfield holding). Gaylan Davis has been involved in the litigation against Comprehensive since the filing of the original suit. As president of Comprehensive, she could control the assertion and prosecution of Comprehensive's defenses. Gaylan Davis cannot now assert more defenses when Comprehensive's liability has been established by court order.

Even assuming Gaylan Davis may assert additional defenses on behalf of Comprehensive, she has failed to present sufficient evidence to preclude summary judgment. One who relies on an affirmative defense to defeat a motion for summary judgment has the burden to come forward with competent summary judgment evidence sufficient to raise a genuine issue of material fact on each element of an affirmative defense. Brownlee, 665 S.W.2d at 112. Gaylan Davis has failed to show how statements in her affidavit raise fact issues on each element of even one of the affirmative defenses she suggests. We overrule the Davises' fourth point of error.

In their fifth point of error, the Davises contend that the trial court erred in rendering summary judgment because a genuine issue of material fact exists with respect to a defect of parties. The Davises claim that RCC should have been joined and that the trial court erred in granting summary judgment in its absence. The Davises cite no authority in support of this point of error. A brief must include page references to the record, citation of authorities relied upon, and a discussion of the facts to support the point in issue. Tex. R. App. P. 74(f). The Davises have waived their fifth point of error; accordingly, we overrule it. Trenholm v. Ratcliff, 646 S.W.2d 927, 934 (Tex. 1983); City of Alvin v. Public Util. Comm'n, 876 S.W.2d 346, 366 (Tex. App.--Austin 1993, writ granted w.r.m.).

The Davises argue in their third point of error that the trial court erroneously granted summary judgment based on claims against Gaylan Davis for fraud, conversion, and other torts, and erroneously awarded damages for those claims, because genuine issues of material fact exist as to Gaylan Davis's liability for those claims and as to American's damages. When, as in the instant case, the order granting summary judgment does not specify the basis or theory upon which it is granted, the summary judgment must be affirmed on any meritorious theory of recovery. Rogers v. Ricane Enters., Inc., 772 S.W.2d 76, 79 (Tex. 1989); Lochabay v. Southwestern Bell Media, Inc., 828 S.W.2d 167, 170 (Tex. App.--Austin 1992, no writ). We have already determined that the trial court properly granted summary judgment because both Tony Davis and Gaylan Davis are liable to American under their personal guaranties; accordingly, we may not reverse this case for improper grant of summary judgment under this point of error. Moreover, American states in its brief that it treated any non-contractual losses suffered by alleged misconduct of the Davises and Comprehensive as subsumed within the amount due under the Davises' personal guaranties. We overrule the Davises' third point of error.

III.  Award of Attorney's Fees

In their seventh point of error, the Davises contend the trial court erred in awarding attorney's fees and expenses to American because a genuine issue of material fact exists as to the reasonableness and necessity of the fees and because American is not entitled to summary judgment on the liability and damage issues. Since we have concluded that American is entitled to summary judgment based on the guaranties, we address this point only to determine whether a fact issue remains regarding the reasonableness of American's requested attorney's fees and expenses.

American submitted the affidavits of its attorneys, Sabrina L. Krakauer and Anne Shuttee. The affidavit of an attorney representing the claimant is expert testimony that will support an award of attorney's fees in a summary judgment. Tesoro Petroleum Corp. v. Coastal Ref. & Mktg., Inc., 754 S.W.2d 764, 767 (Tex. App.--Houston [1st Dist.] 1988, writ denied). A summary judgment may be based on the uncontroverted affidavits of expert witnesses "if the evidence is clear, positive and direct, otherwise credible and free from contradictions and inconsistencies, and could have been readily controverted." Tex. R. Civ. P. 166a(c).

Krakauer states in her affidavit that she was a licensed Texas lawyer and a partner in her law firm; she and several colleagues had worked on various aspects of the case; litigation took place in both Travis County district court and bankruptcy court; and the requested fees and expenses were reasonable and customary in Travis County. Krakauer listed the specific tasks handled by attorneys, paralegals, and law clerks at her firm, and averred that all the listed activities were "necessary to the prosecution of th[e] action on behalf of American." Shuttee stated in her affidavit that she was a licensed Texas lawyer and in-house counsel for American's parent corporation; she and a paralegal had worked on various aspects of the case; and her requested fees and expenses were not only reasonable but also considerably less than the customary rates charged in Travis County. We conclude that American's expert witness affidavits comport with the requirements of Rule 166a(c) and established the reasonableness of the attorney's fees award.

To avoid the award of attorney's fees to American, the Davises had to present competent summary judgment evidence controverting that of American. Tex. R. Civ. P. 166a(c) (permitting summary judgment based on uncontroverted expert witness affidavits). To do so, the Davises presented the affidavit of their expert on attorney's fees, Hubert Gill. See American 10-Minute Oil Change v. Metropolitan Nat'l Bank-Farmers Branch, 783 S.W.2d 598, 602 (Tex. App.--Dallas 1988, no writ) (filing of affidavit by nonmovant contesting reasonableness of movant's affidavit on attorney's fees can create fact issue). In a summary judgment proceeding, the affidavit of an opposing expert witness must contain a statement of the facts on which the expert opinion is based. Trapnell v. John Hogan Interests, Inc., 809 S.W.2d 606, 610 (Tex. App.--Corpus Christi 1991, writ denied). These facts must be of the kind used by experts to reach such conclusions. Tex. R. Civ. Evid. 703; Trapnell, 809 S.W.2d at 610. Any legal conclusions in the affidavit must be reasonable and supported by the facts offered by the expert. Trapnell, 809 S.W.2d at 610.

Gill stated by affidavit that he was unable to determine if the work of Krakauer and others at her firm was unnecessary or duplicative; that "it has not been shown that [American] is actually responsible for payment of [Shuttee's] bill," implying that American may not recover attorney's fees for work of in-house counsel; and that it is impossible to determine if the hours American's counsel worked on Comprehensive's bankruptcy proceedings were fair, reasonable, or even applicable to issues in the present case.

Gill's statements do not support his ultimate conclusion that American's requested legal fees and expenses were excessive. Gill does not indicate any duplicative or unnecessary work completed and does not controvert the proof that the work was reasonable and necessary. Gill's implication that American cannot recover attorney's fees for work of in-house counsel conflicts with established Texas law. See Tesoro Petroleum, 754 S.W.2d at 766-67 (allowing recovery of attorney's fees for work of in-house counsel). Gill's statement about the impossibility of determining the reasonableness of the number of hours American's counsel worked on Comprehensive's bankruptcy case does not controvert the guaranty agreements included in American's summary judgment evidence entitling American to recover from the Davises all attorney's fees American incurred by reason of Comprehensive's default on its payment obligations to American. The guaranties thus cover fees American incurred in pursuit of its claims against Comprehensive in bankruptcy court. Gill even fails to suggest what, in his experience, an award of attorney's fees should properly be based upon. As such, even when we indulge all reasonable inferences in favor of the Davises, Gill's conclusory affidavit fails to controvert the reasonableness of the attorney's fees and expenses established by American.

The Davises' contend that $23,589 in expenses is unreasonable because no explanation for these fees was given. This issue was not raised before the trial court. The Davises may not now assert that the trial court erred in awarding those expenses to American. Tex. R. Civ. P 166a(c) ("Issues not expressly presented to the trial court by written motion, answer or other response shall not be considered on appeal as grounds for reversal."). We overrule the Davises' seventh point of error.

Having overruled all of the Davises' points of error, we affirm the judgment of the trial court.

Marilyn Aboussie, Justice

Before Justices Powers, Aboussie and B. A. Smith

Affirmed

Filed: March 29, 1995

Do Not Publish

1.   Both points of error state that the trial court erred in "awarding damages" against the Davises, but in effect, the argument of the points goes to the granting of the summary judgment.

2.   The Davises cannot contest the liability of Comprehensive or Tony Davis because it was established in the Sanctions Order. American only had to prove damages to recover against Tony Davis. Nevertheless, the Davises' first point of error asserts that the trial court erred in awarding damages against Tony Davis since a genuine issue of material fact exists as to whether American is entitled to relief under his guaranty agreement. The Davises neither argue nor cite any authority in support of this point. They have therefore waived the point of error as to Tony Davis. Trenholm v. Ratcliff, 646 S.W.2d 927, 934 (Tex. 1983); see also Tex. R. App. P. 74(f) (requiring argument to include "authorities relied upon as may be requisite to maintain the point at issue").

3.   The guaranty is dated February 12, 1987; the handwritten date on the document indicates that it was signed on February 11, 1987. It is undisputed that Gaylan Davis signed this guaranty.

4.   In 1989, American agreed to receive funds in exchange for the transfer to RCC of lease receivables. In late 1990, after terminating its partnership with Comprehensive in February 1990, American transferred some lease receivables from the former partnership to RCC.

5.   The Davises also argue their entitlement to an offset by claiming Comprehensive is owed a percentage of the monies American received for lease transfers to RCC. However, the partnership did not exist at the time of the lease transfers; Comprehensive cannot collect proceeds from a non-partnership transaction. While American transferred some lease receivables from other partnerships to RCC in 1989, the record indicates that no lease receivables from the Comprehensive partnership were involved.