BDFI, LLC v. Boxer Property Management Corporation ( 2024 )

Affirmed and Memorandum Opinion filed July 9, 2024.
In The
Fourteenth Court of Appeals
NO. 14-22-00828-CV
BDFI, LLC, Appellant
V.
BOXER PROPERTY MANAGEMENT CORPORATION, Appellee
On Appeal from the 295th District Court
Harris County, Texas
Trial Court Cause No. 2019-85286
MEMORANDUM OPINION
Appellant BDFI, LLC appeals from a post-answer default judgment
rendered against it in favor of appellee Boxer Property Management Corporation.
In four issues, BDFI argues the trial court abused its discretion by denying its
motions for continuance (issues I and II), its motion for new trial (issue III), and
for dismissing the jury panel and conducting a bench trial when it failed to appear
for trial (issue IV). We affirm the judgment of the trial court as challenged on
appeal.
I. BACKGROUND
In 2018, BDFI entered into a management agreement with Boxer to manage
a commercial real estate property BDFI owned in Harris County. Several months
later, the business relationship soured and BDFI failed to pay amounts due under
the contract. Boxer terminated the contract, filed an affidavit of mechanic’s lien,
and ultimately filed suit alleging breach of contract, suit on a sworn account, and,
alternatively, quantum meruit and promissory estoppel.
BDFI answered and asserted a counterclaim. In June 2022, BDFI’s trial
counsel voluntarily withdrew leaving BDFI without representation until August 5,
2022. When new counsel—attorney MacGeorge—appeared, the case was set for
trial ten days later.
BDFI filed a motion for continuance requesting an extension of the trial date
due to a conflicting trial setting in another Harris County district court the same
week with the same client. The trial court extended the trial date by one week to
August 23, to avoid conflicting trials.
The morning of August 22 BDFI filed another motion for continuance
explaining that the conflicting trial was still ongoing and sought to delay its case
with Boxer for at least 60 days. At 11 pm on August 22, BDFI filed a supplement
to its motion for continuance requesting a continuance of the trial date by 60 days
because its attorney was “unavailable for trial pursuant to medical instructions
from a licensed physician, instructing her to not to perform work through August
26th.” The trial court denied BDFI’s motion for continuance and conducted a
bench trial on Boxer’s claims on August 23.
2
II. ANALYSIS
A. Applicable law and standard of review
The granting or denial of a motion for continuance is within the trial court’s
sound discretion. Villegas v. Carter, 711 S.W.2d 624, 626 (Tex. 1986). The denial
will be reversed if the trial court acted without regard to guiding principles or was
arbitrary or unreasonable. See Brewer v. Lennox Hearth Prods., LLC, 601 S.W.3d
704, 717 (Tex. 2020); BMC Software Belg., N.V. v. Marchand, 83 S.W.3d 789, 800
(Tex. 2002).
Trial courts may not grant a continuance “except for sufficient cause
supported by affidavit, or by consent of the parties, or by operation of law.” Tex.
R. Civ. P. 251. If the ground on which a party seeks a continuance is the absence of
counsel, the rule states “absence of counsel will not be good cause for a
continuance or postponement of the cause when called for trial, except it be
allowed in the discretion of the court, upon cause shown or upon matters within the
knowledge or information of the judge to be stated on the record.” Tex. R. Civ. P.
253. A movant must show that the failure to be represented at trial was not due to
their own fault or negligence.1 Villegas, 711 S.W.2d at 626.
B. First request for continuance
In issue I, BDFI argues that the trial court erred by denying its request for
continuance of the trial date by 60 days. BDFI asserts the trial court should have
either denied the first trial counsel’s request to withdraw or granted a continuance.
It maintains that ten days was not enough time to appropriately prepare for trial
and that by the time MacGeorge appeared, the deadline to submit trial exhibit and
1
The motion to withdraw filed by BDFI’s former counsel is not part of our record, so the
reason for their withdrawal is unknown. However, the order granting their withdrawal is part of
the record.
3
witness lists had already passed. Here, we construe BDFI’s issue as arguing that
although the trial court granted the motion and continued the trial date by 8 days,
the trial court nevertheless erred by not continuing the trial date by at least 60 days,
as requested.
We conclude this issue has not preserved for appellate review. In its motion
for continuance, BDFI requested “a continuance of the current trial setting because
Defendants[’] counsel and the principal of the Defendant are currently in trial in
the 334th . . . and are expected to be so until August 18th, and possibly later.” On
that basis, BDFI sought a continuance of the trial for at least 60 days. BDFI’s
motion did not seek a continuance on the basis that more time was needed for trial
preparation or that critical deadlines had passed while BDFI was unrepresented.
The argument presented to this court as error was never made to the trial court.
Therefore, the trial court had no opportunity to consider or rule on this request.
Tex. R. App. P. 33.1.
We overrule issue I.
C. Second request for continuance
In issue II, BDFI argues that the trial court abused its discretion by denying
the second motion for continuance without making a reasonable effort to determine
whether MacGeorge’s medical condition resulted in her failure to appear at trial.2
BDFI further argues the trial court misread the doctor’s discharge instructions and
that error amounts to an abuse of discretion.
2
BDFI also states “the trial court abused its discretion by denying Defendant’s Second
Motion for Continuance for the same reasons it abused its discretion when it denied Defendant’s
Motion for Continuance.” However, as above in Issue I, BDFI requested the second continuance
on the basis that its counsel and principal would be in trial on a different case. BDFI never
argued that it needed more time to prepare or to respond to critical deadlines. Therefore, this
argument is not preserved for appellate review with respect to the second motion for
continuance.
4
We begin with BDFI’s claim that the trial court’s misreading of the doctor’s
note was error. BDFI argues that the doctor’s discharge instructions state that
MacGeorge should return in four days’ time rather than excusing her from work
for four days. However, the motion filed by MacGeorge on behalf of BDFI
undercuts this argument. It states that MacGeorge was “unavailable for trial
pursuant to medical instructions from a licensed physician, instructing her to not []
perform work through August 26th, 2022 due to ongoing health concerns.”
Regardless which interpretation of the note was intended by the doctor, or
understood by the trial court, the difference in interpretation does not change the
analysis or compel the conclusion the trial court erred. The trial court understood
that BDFI was not appearing on August 23 (or any day that week) because
MacGeorge was unavailable due to instructions from a physician.
The second motion for continuance did not explain MacGeorge’s “ongoing
health concerns.” The single sheet of paper from the emergency clinic did not offer
a diagnosis nor did it state that MacGeorge was physically unable to attend or
unavailable. MacGeorge included an unsworn declaration with her motion that
stated all the facts in the supplemental motion were true and correct. However,
MacGeorge did not submit an affidavit from her medical provider establishing
sufficient cause. 3 Tex. R. Civ. P. 251 (“[N]or shall any continuance be granted
except for sufficient cause supported by affidavit[.]”) (emphasis added); see
Olivares v. State, 693 S.W.2d 486, 490 (Tex. App.—San Antonio 1985, writ
dism’d) (“While appellant did attach his own affidavit of the facts, he had no
supporting affidavit from medical personnel stating it was impossible, from a
medical standpoint, for him to appear in court on March 19th.”); see also White v.
Mapel, No. 01-95-01125-CV, 1996 WL 496908, at *4 (Tex. App.—Houston [1st
3
We presume without deciding that an unsworn declaration from the medical provider
would satisfy Rule 251. See Tex. Civ. Prac. & Rem. Code Ann. § 132.001.
5
Dist.] Aug. 29, 1996, no writ) (not designated for publication) (no abuse of
discretion in denying motion for continuance when movant offered no evidence
regarding nature of movant’s condition).
Based on the record before this court, we cannot say the trial court abused its
discretion in denying the second motion for continuance. We overrule issue II.
D. Motion for new trial
In issue III, BDFI asserts the trial court erred and abused its discretion by
denying its motion for new trial. On appeal, BDFI argues that it met the Craddock
test for setting aside the default judgment.
1. Standard of review
We review a trial court’s denial of a motion for new trial for abuse of
discretion. E.g., Dolgencorp of Tex., Inc. v. Lerma, 288 S.W.3d 922, 926 (Tex.
2009) (per curiam). A trial court abuses its discretion if it fails to grant a new trial
when a defaulting defendant proves each element of the Craddock test. Id. at 926.
A default judgment should be set aside and a new trial granted if (1) the failure to
answer was not intentional or the result of conscious indifference but was due to a
mistake or accident, (2) the defendant sets up a meritorious defense, and (3) the
motion is filed at such time that granting a new trial would not result in delay or
otherwise injure the plaintiff. Craddock v. Sunshine Bus Lines, Inc., 133 S.W.2d
124, 126 (Tex. 1939).
2. The record
The record before us includes a motion for new trial and a ruling on what
appears to be BDFI’s amended motion for new trial. It is unclear on the record
before us whether there was an amended motion for new trial. However, issue III
does not discuss or address any argument made in the amended motion for new
6
trial; therefore, the amended motion for new trial is not necessary to address any
issues raised in this appeal.4 See Tex. R. App. P. 47.1. Although there is no order
denying the motion for new trial, we can presume it was overruled as a matter of
law. Tex. R. Civ. P. 329b(c). Although Boxer suggests that a hearing was held on
the motion for new trial, there is nothing in the clerk’s record or the reporter’s
record to reflect a hearing was requested or held.5
Regardless of whether a hearing was held, evidentiary hearings are not
required to be held on a motion for new trial, except for complaints on which
evidence must be heard. Tex. R. Civ. P. 324; see Action Powersports, Inc. v.
1STEL, Inc., 500 S.W.3d 632, 640 (Tex. App.—Texarkana 2016, no pet.) (“When
no hearing is held, we look to the motion for new trial and any accompanying
affidavits to determine if this burden is met.”). However, in the context of a
challenge to a default judgment under the Craddock test, it is sufficient that any
affidavits supporting any element of the Craddock test are attached to the motion
for new trial and made part of the record. Dir., State Employees Workers’ Comp.
Div. v. Evans, 889 S.W.2d 266, 268 (Tex. 1994) (“Affidavits attached to the
motion for new trial do not have to be offered into evidence in order to be
considered by the trial court for the meritorious defense element or any other
element of the Craddock test.”). The lack of a hearing record is not dispositive of
4
Boxer argues that the amended motion for new trial filed by BDFI superseded the
original motion for new trial. Boxer further argues that the amended motion for new trial is not in
the appellate record. Therefore, Boxer asks us to conclude that BDFI’s motion for new trial
(which is in the record) has been superseded and does not preserve error on any of its arguments
challenging the default judgment. However, the amended motion for new trial, if it was filed, is
not in the record before us. We cannot assume, without more, that the order granting the
amended motion for trial necessitates a conclusion there was a timely-filed amended motion for
new trial. We also cannot reach any conclusions about the timeliness or effect of filings that are
not in the record.
5
Even if a hearing was held, which we cannot discern from this record, it is not clear
whether the hearing was an evidentiary hearing.
7
this issue. We must review the affidavits attached to the motion for new trial.
3. Craddock test
Because it is dispositive of the issue, we begin with the second Craddock
factor—whether BDFI set up a meritorious defense in its motion for new trial.
BDFI argues that it has a meritorious argument for reducing the amount of
damages awarded against it.
The second prong of the Craddock test requires BDFI to “set up” a
meritorious defense in its motion for new trial. Craddock, 133 S.W.2d at 126.
Setting up a meritorious defense does not require proof “in the accepted sense.”
Dolgencorp, 288 S.W.3d at 927–28. Rather, the motion sets up a meritorious
defense if it alleges facts which in law would constitute a defense to the plaintiff’s
cause of action and is supported by affidavits or other evidence providing prima
facie proof that the defendant has such a defense. Id.; see Guaranty Bank v.
Thompson, 632 S.W.2d 338, 339 (Tex. 2006). It is sufficient if at least a portion of
the judgment would not be sustained on retrial. See, e.g., HST Gathering Co. v.
Motor Serv., Inc., 683 S.W.2d 743, 745 (Tex. App.—Corpus Christi 1984, no writ)
(defendant set up prima facie defense as “to some, if not all, of the monies”
awarded in judgment); Folsom Invs., Inc. v. Troutz, 632 S.W.2d 872, 875 (Tex.
App.—Fort Worth 1982, writ ref’d n.r.e.) (defendant set up meritorious defense as
to lesser amount of damages; opposite result of total nonliability need not be
proved). However, conclusory allegations are insufficient. Holt Atherton Indus.,
Inc. v. Heine, 835 S.W.2d 80, 82 (Tex. 1992).
Although BDFI argues that it has a meritorious defense to the award of
damages, BDFI never set up any meritorious defense. The trial court in its final
judgment held that the parties entered into a valid and enforceable contract, which
BDFI breached by failing to pay the amounts due. Both in its motion for new trial
8
and in this court, BDFI does not explain how or why there would have been a
lesser award of damages if it had been present at trial to contest the damages.
Although BDFI highlights that Boxer’s damages included charges for a $25.00
Starbucks gift card and a picture frame, suggesting that such charges were
inappropriate, it offers no explanation as to why those charges or any other charges
comprising Boxer’s damages were not recoverable under the contract between the
parties.6, 7
Other than saying things would be different if it could have challenged the
damages, BDFI offers no explanation or legal argument of which damages it would
challenge or under what legal theory or defense it would make its challenge. Boxer
introduced evidence and testimony at trial. At this stage, BDFI must do more than
say Boxer “will need to account for all $72,943.62 in itemized charges in the
6
BDFI also argues that it filed a verified denial of Boxer’s sworn-account claim because
not all lawful offsets and credits were made. The trial court’s final judgment did not reference
the suit-on-a-sworn-account claim. However, we note that the filing of a sworn denial merely
destroys the evidentiary presumption that the affidavit attached to the suit is the evidence
necessary to establish a prima facie right of recovery. See Tex. R. Civ. P. 185; Tandan v.
Affordable Power, L.P., 377 S.W.3d 889, 894 (Tex. App.—Houston [14th Dist.] 2012, no pet.).
By filing a sworn denial, BDFI forced Boxer to introduce proof of its claim, which Boxer did at
trial. BDFI did not outline in its motion for new trial any facts or defenses that demonstrate any
legal entitlement to offsets or credits that it did not receive. See Siegler v. Williams, 658 S.W.2d
236, 239 (Tex. App.—Houston [1st Dist.] 1983, no writ) (“The appellant pleaded legal
conclusions and [failed] to allege facts sufficient to set up a meritorious defense. We hold that
the trial court did not abuse its discretion in overruling the appellant’s motion for new trial.”).
7
BDFI also alleges in its motion for new trial that it had a meritorious defense in that
Boxer previously breached the management contract. Although BDFI states there is testimony
and evidence “in the record of this Court” that establishes a fact issue on Boxer’s failure to
perform under the contract, BDFI does not allege a material breach. When a party commits a
nonmaterial breach, the other party “is not excused from future performance but may sue for the
damages caused by the breach.” Bartush-Schnitzius Foods Co. v. Cimco Refrigeration, Inc., 518
S.W.3d 432, 436 (Tex. 2017) (per curiam); see generally, e.g., Mays v. Pierce, 203 S.W.3d 564,
575 (Tex. App.—Houston [14th Dist.] 2006, pet. denied) (“A breach of contract occurs when a
party fails or refuses to do something he has promised to do.”). Even so, BDFI provided no
affidavit or evidence in its motion for new trial to establish such a defense. Therefore, we
conclude this issue was not preserved for appellate review.
9
General Ledger.” This statement does not set up a meritorious defense. Because
BDFI did nothing more than assert its conclusion that some unknown amount of
the itemized charges introduced into evidence were not recoverable, we conclude
that BDFI has not met its burden to set aside the default judgment.8 Ivy v. Carrell,
407 S.W.2d 212, 214 (Tex. 1966) (“This does not mean that the motion should be
granted if it merely [a]lleges that the defendant ‘has a meritorious defense.’ The
motion must allege [f]acts which in law would constitute a defense to the cause of
action asserted by the plaintiff, and must be supported by affidavits or other
evidence proving prima facie that the defendant has such meritorious defense.”);
Action Powersports, 500 S.W.3d at 640 (“[T]he allegations that [defendant] is
entitled to offsets and that [plaintiff] failed to provide the promised services are
conclusory. There are no facts alleged showing what services [plaintiff] failed to
provide or establishing that [defendant] was entitled to an offset. Therefore, the
motion did not set up a meritorious defense for [defendant].”).
We conclude the trial court did not abuse its discretion by denying
appellants’ motion for new trial. See Heine, 835 S.W.2d at 83 (concluding that,
because appellants failed to satisfy first element of Craddock test, it was not
necessary to reach other two elements). We overrule issue III.
E. Dismissal of jury panel
In issue IV, BDFI argues the trial court abused its discretion by dismissing
the jury panel and conducting a bench trial. In support of this issue, BDFI argues
that it properly demanded a jury trial and that its absence from trial was not
voluntary.
8
The motion for new trial does contain, as an exhibit, a verification signed by an
employee of BDFI. This verification was attached to BDFI’s third amended answer and
counterclaim filed more than a year before the motion for new trial. The verification standing
alone provides no facts, only legal conclusions, to set up a meritorious defense for BDFI.
10
Rule 220 of the Texas Rules of Civil Procedure provides:
When any party has paid the fee for a jury trial, he shall not be
permitted to withdraw the cause from the jury docket over the
objection of the parties adversely interested. If so permitted, the court
in its discretion may by an order permit him to withdraw also his jury
fee deposit. Failure of a party to appear for trial shall be deemed a
waiver by him of the right to trial by jury.
Tex. R. Civ. P. 220. Although BDFI argues its failure to appear must be voluntary,
the rule contains no such language and BDFI cites to no authority supporting such
a requirement.9 This court has previously discussed that even an untimely
appearance for trial, under the rules, may forfeit a right to jury trial. In re Marriage
of Harrison, 557 S.W.3d 99, 136 (Tex. App.—Houston [14th Dist.] 2018, pet.
denied) (citing In re T.K., No. 09-09-00472-CV, 2010 WL 890657, at *4 (Tex.
App.—Beaumont Mar. 11, 2010, no pet.) (mem. op.) (counsel’s appearance four
hours late deemed waiver of right to jury trial) and Money v. Jones, 766 S.W.2d
307, 308–09 (Tex. App.—Dallas 1989, writ denied) (trial counsel’s refusal to go
forward with trial constituted failure to appear and waived right to jury trial)).
Because BDFI did not appear for trial, it waived its right to a jury trial. C4
Food Truck, LLC v. Lewis, No. 14-21-00292-CV, 2024 WL 973760, at *1 (Tex.
9
BDFI cites a few cases for general propositions. For instance, it cites to Mendez v. State,
for the proposition that due process of law is required for the waiver of constitutional rights.
Mendez, 138 S.W.3d 334, 344 (Tex. Crim. App. 2004). However, Mendez is a criminal case and
BDFI did not preserve any argument regarding deprivation of a constitutional right in a civil
case. BDFI also cites two other cases for the proposition that the trial court’s removal of a case
from the jury docket once it is properly on the jury docket is error. See Cardenas v. Montfort,
Inc., 894 S.W.2d 406, 409–10 (Tex. App.—San Antonio 1994), writ denied per curiam, 924
S.W.2d 156 (Tex. 1996) (“We find no error in the judgment of the court of appeals. However, we
neither approve nor disapprove its opinion. The petition for writ of error is denied.”); Zemanek v.
Boren, 810 S.W.2d 10, 11–12 (Tex. App.—Houston [14th Dist.] 1991, no writ.). However,
neither case addresses a situation in which a party has failed to appear for trial and therefore is
not instructive on the issue raised by appellant. Similarly, BDFI also cites to Halsell v. Dehoyos,
which addresses the timeliness of a request for a jury trial and not the situation of a party that did
not appear for trial. Halsell, 810 S.W.2d 371 (Tex. 1991).
11
App.—Houston [14th Dist.] Mar. 7, 2024, no pet.) (mem. op.) (“Because
appellants did not appear for trial, they waived their right to a jury trial.”). We
overrule issue IV.
III. CONCLUSION
Having overruled BDFI’s four issues, we affirm the judgment of the trial
court as challenged on appeal.
/s/ Charles A. Spain
Justice
Panel consists of Justices Wise, Spain, and Hassan.
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