Margarita Angelino Trujillo v. Shafaii Investments, Ltd. ( 2024 )

Opinion issued May 7, 2024
In The
Court of Appeals
For The
First District of Texas
————————————
NO. 01-22-00819-CV
———————————
MARGARITA ANGELINO TRUJILLO, Appellant
V.
SHAFAII INVESTMENTS, LTD., Appellee
On Appeal from the Civil Court at Law No. 3
Harris County, Texas
Trial Court Case No. 1182578
MEMORANDUM OPINION ON REHEARING
Appellant Margarita Angelino Trujillo has filed a motion for rehearing of our
January 18, 2024 opinion and judgment. We deny the motion for rehearing,
withdraw our opinion and judgment of that date, and issue this memorandum opinion
and a new judgment in their stead. Our disposition remains the same.
In this forcible detainer action, Angelino challenges the trial court’s summary
judgment awarding possession of the property at issue to Shafaii Investments, Ltd.,
the purchaser of the property at a foreclosure sale. We affirm.
BACKGROUND
Angelino purchased a townhome from Raj Shafaii and signed a real estate lien
note and deed of trust to finance the purchase. The deed of trust provides:
If any of the Property is sold under this Deed of Trust, [Angelino]
must immediately surrender possession to the purchaser. If [Angelino]
fails to do so, [Angelino] will become a tenant at sufferance of the
purchaser, subject to an action for forcible detainer.
Several years later, Raj Shafaii foreclosed on the property. At the foreclosure sale,
Raj Shafaii’s company, Shafaii Investments,1 submitted the highest bid. The
substitute trustee’s deed, conveying the property to Shafaii Investments, states that
the property was sold to Shafaii Investments in consideration of the sum of $31,500
that Shafaii Investments paid to the substitute trustee. However, Shafaii Investments
never tendered the foreclosure bid price to the substitute trustee. Instead, Shafaii
Investments wrote a check for $31,500 to Raj Shafaii personally, and he deposited
the check into his wife’s bank account.
After the foreclosure sale, Shafaii Investments filed a forcible detainer action
against Angelino in justice court seeking possession of the property. The justice
1
Raj Shafaii is the president and general partner of Shafaii Investments.
2
court granted Shafaii Investments’ motion for summary disposition and awarded
possession of the property to Shafaii Investments.
Angelino then appealed to the county court at law. The parties tried the case
to a jury, and the jury found in favor of Angelino. Shafaii Investments moved for a
judgment notwithstanding the verdict, which the trial court granted. The trial court
concluded there was legally insufficient evidence to support the jury’s finding and
that the evidence presented at trial conclusively established that Shafaii Investments
was entitled to possession of the property.
On learning the reporter’s record of the jury trial was lost, the parties agreed
to a new trial, which the trial court granted. Shafaii Investments then moved for
summary judgment. The trial court initially denied the motion. However, at the
pretrial conference a couple of months later, the trial court reconsidered Shafaii
Investments’ motion for summary judgment and granted it, awarding Shafaii
Investments possession of the property. The trial court also awarded Shafaii
Investments its requested attorney’s fees. Angelino now appeals from the trial
court’s summary judgment.
DISCUSSION
Angelino raises four issues on appeal. First, she argues there is a title dispute
depriving the lower courts of jurisdiction to hear Shafaii Investments’ forcible
detainer action because there was a defect in the foreclosure sale—Shafaii
3
Investments never tendered the foreclosure bid price to the substitute trustee.
Alternatively, Angelino argues the trial court erred in granting summary judgment
for and awarding attorney’s fees to Shafaii Investments for three reasons: (1) Shafaii
Investments did not conclusively establish that it owned the property; (2) Shafaii
Investments did not conclusively establish that it complied with statutory notice
requirements; and (3) Shafaii Investments did not provide sufficient evidence to
support the conditional attorney’s fee award.
Forcible Detainer
Under the Texas Property Code, a tenant who refuses to surrender possession
of real property on demand commits a forcible detainer. TEX. PROP. CODE
§ 24.002(a). The person claiming a superior right of possession may file a forcible
detainer action in a justice court to obtain possession of the property. See id.
§ 24.004(a). A forcible detainer action is a “speedy, simple, and inexpensive means
to obtain immediate possession of property.” Coinmach Corp. v. Aspenwood
Apartment Corp., 417 S.W.3d 909, 919 (Tex. 2013) (quoting Marshall v. Hous.
Auth. of the City of San Antonio, 198 S.W.3d 782, 787 (Tex. 2006)). The only issue
the justice court may decide is the right to actual, immediate possession of the
premises. Id.; Yarbrough v. Household Fin. Corp. III, 455 S.W.3d 277, 280 (Tex.
App.—Houston [14th Dist.] 2015, no pet.). A justice court has no jurisdiction to
decide title to property, nor does a county court reviewing a justice court’s forcible
4
detainer judgment in an appellate capacity. TEX. R. CIV. P. 510.3(e); Yarbrough, 455
S.W.3d at 280; Rice v. Pinney, 51 S.W.3d 705, 709 (Tex. App.—Dallas 2001, no
pet.). A forcible detainer action is cumulative of any other remedy a party may have.
Rice, 51 S.W.3d at 709. Thus, a party may bring a separate suit in district court to
determine any title issues, and this suit may be prosecuted concurrently with the
forcible detainer action in justice court. Id.To prevail in a forcible detainer action, the plaintiff must show a superior right
to immediate possession of the property. To establish a superior right to immediate
possession, a plaintiff must prove: (1) the plaintiff owns the property; (2) the
defendant is either a tenant at will, tenant at sufferance, or a tenant or subtenant
willfully holding over after the termination of the tenant’s right of possession; (3)
the plaintiff gave proper notice to the defendant to vacate the property; and (4) the
defendant refused to vacate the property. Shields Ltd. P’ship v. Bradberry, 526
S.W.3d 471, 478 (Tex. 2017).
A landlord–tenant relationship is a necessary element in a forcible detainer
action. Yarbrough, 455 S.W.3d at 280. Often, a deed of trust will state that on
foreclosure of the property, a tenancy at sufferance is created. See id. Tenancy at
sufferance clauses separate the issue of possession from the issue of title. Pinnacle
Premier Props., Inc. v. Breton, 447 S.W.3d 558, 564 (Tex. App.—Houston [14th
Dist.] 2014, no pet.).
5
When a deed of trust creates a tenancy in the event of foreclosure, the
landlord–tenant relationship provides a basis for deciding the possession issue,
regardless of any title issues or alleged defects in the foreclosure process and even
though the substitute trustee’s deed following the foreclosure sale can later be set
aside for wrongful foreclosure. Gardocki v. Fed. Nat’l Mortg. Ass’n, No. 14-12-
00921-CV, 2013 WL 6568765, at *3 (Tex. App.—Houston [14th Dist.] Dec. 12,
2013, no pet.) (mem. op.); see also Yarbrough, 455 S.W.3d at 282; Villalon v. Bank
One, 176 S.W.3d 66, 71 (Tex. App.—Houston [1st Dist.] 2004, pet. denied). Defects
in the foreclosure process cannot be considered in a forcible detainer action but may
be pursued in a separate suit for wrongful foreclosure or to set aside the substitute
trustee’s deed. Lua v. Cap. Plus Fin., LLC, 646 S.W.3d 622, 629–30 (Tex. App.—
Dallas 2022, pet. denied).
The purchaser at the foreclosure sale generally may establish a superior right
to immediate possession by providing the deed of trust creating the tenancy at
sufferance, the substitute trustee’s deed, and proof of proper notice to vacate the
property. See Williams v. Bank of N.Y. Mellon, 315 S.W.3d 925, 927 (Tex. App.—
Dallas 2010, no pet.).
Jurisdiction
Angelino first argues a genuine title issue exists that deprives the lower courts
of jurisdiction in this forcible detainer action because the substitute trustee’s deed is
6
void, meaning it conveys no interest and leaves Angelino as the owner of the
property.
Applicable Law
A justice court has no jurisdiction to decide title to property, nor does a county
court reviewing a justice court’s forcible-detainer judgment in an appellate capacity.
TEX. R. CIV. P. 510.3(e); Yarbrough, 455 S.W.3d at 280; Rice, 51 S.W.3d at 709.
Thus, when a forcible detainer action presents a “genuine issue of title so
intertwined with the issue of possession” that the justice court cannot award
possession without first deciding the title issue, then the justice court lacks
jurisdiction to decide either issue. Yarbrough, 455 S.W.3d at 280; see also Pinnacle
Premier Props., 447 S.W.3d at 563; Mitchell v. Armstrong Cap. Corp., 911 S.W.2d
169, 171 (Tex. App.—Houston [1st Dist.] 1995, writ denied). But the mere existence
of a title dispute does not deprive the justice court of jurisdiction; a justice court
lacks jurisdiction “only if resolution of a title dispute is a prerequisite to
determination of the right to immediate possession.” Yarbrough, 455 S.W.3d at 280(quoting Salaymeh v. Plaza Centro, LLC, 264 S.W.3d 431, 435 (Tex. App.—
Houston [14th Dist.] 2008, no pet.)).
Although a genuine issue of title intertwined with a possession issue deprives
a justice court of jurisdiction, defects in the foreclosure process do not. Lua, 646
S.W.3d at 630 n.3 (“Challenges to the validity of a foreclosure sale do not deprive
7
the justice court or county court of jurisdiction.”); Onabajo v. Household Fin. Corp.
III, No. 03-15-00251-CV, 2016 WL 3917140, at *2 (Tex. App.—Austin July 14,
2016, no pet.) (mem. op.) (“Defects in the foreclosure process cannot be used . . . to
raise a question of title depriving the justice or county courts of jurisdiction to
resolve the question of immediate possession.”); see, e.g., Pinnacle Premier Props.,
447 S.W.3d at 564–65 (holding defendant’s claim that foreclosure sale was
conducted improperly did not deprive lower courts of jurisdiction); Gardocki, 2013
WL 6568765, at *4 (holding defendant’s claim that plaintiff did not comply with
foreclosure clause in deed of trust and thus failed to create tenancy at sufferance did
not deprive lower courts of jurisdiction); Dormady v. Dinero Land & Cattle Co.,
L.C., 61 S.W.3d 555, 558–59 (Tex. App.—San Antonio 2001, pet. dism’d w.o.j.)
(holding defendant’s claim that trustee did not comply with terms of deed of trust
when posting property for foreclosure did not deprive lower courts of jurisdiction).
A defendant in a forcible detainer action may raise these defects in a separate suit
for wrongful foreclosure or to set aside the trustee’s deed, but they are not relevant
in a forcible detainer action. Lua, 646 S.W.3d at 630.
Because tenancy at sufferance clauses separate the issue of possession from
the issue of title, Pinnacle Premier Props., 447 S.W.3d at 564, a forcible detainer
action may proceed based on a tenancy at sufferance clause in a deed of trust,
regardless of whether the plaintiff in the action complied with the terms of the deed
8
of trust in the foreclosure process. E.g., Gardocki, 2013 WL 6568765, at *4 (“Courts
of appeals have consistently allowed forcible detainer actions to proceed based on a
tenancy at sufferance clause in a deed of trust without regard to whether the party
seeking possession complied with the terms of the deed of trust.”). The validity of
the foreclosure process must be resolved by a district court in a separate suit,
independent of the forcible detainer action. Id. (defendant’s challenge to validity of
foreclosure could be litigated in district court separately from possession issue in
justice or county court); Guillen v. U.S. Bank, N.A., 494 S.W.3d 861, 868 (Tex.
App.—Houston [14th Dist.] 2016, no pet.) (explaining that any question of
foreclosure’s validity must be resolved in district court independent of outcome of
possession issue). A justice court need not determine whether a foreclosure was valid
before awarding possession. Elwell v. Countrywide Home Loans, Inc., 267 S.W.3d
566, 569 (Tex. App.—Dallas 2008, pet. dism’d w.o.j.).
Subject matter jurisdiction is a question of law that we review de novo.
Yarbrough, 455 S.W.3d at 279.
Analysis
Here, Angelino argues there was a defect in the foreclosure sale—she claims
the foreclosure sale did not comply with the terms of the deed of trust because Shafaii
Investments never tendered the foreclosure bid price to the substitute trustee,
rendering the substitute trustee’s deed void. The deed of trust, she explains,
9
authorizes the substitute trustee to sell the property to the highest bidder for cash on
foreclosure. But Shafaii Investments did not pay the substitute trustee; instead,
Shafaii Investments wrote a check to Raj Shafaii personally. Thus, she argues,
Shafaii Investments did not buy the property, and the substitute trustee’s deed is
void. She asserts the void substitute trustee’s deed raises a title dispute so intertwined
with the issue of possession as to deprive the lower courts of jurisdiction.
Angelino is essentially arguing there was a defect in the foreclosure sale. It is
well settled that defects in the foreclosure process do not affect a justice court’s
jurisdiction over a forcible detainer action. See Lua, 646 S.W.3d at 630 n.3;
Onabajo, 2016 WL 3917140, at *2; Pinnacle Premier Props., 447 S.W.3d at 564–
65; Gardocki, 2013 WL 6568765, at *4; Dormady, 61 S.W.3d at 558–59. These
types of defects are not relevant in a forcible detainer action and can only be resolved
by a district court in a wrongful foreclosure action. See Lua, 646 S.W.3d at 630 &
n.3; Gardocki, 2013 WL 6568765, at *4; Guillen, 494 S.W.3d at 868.
Angelino argues that the substitute trustee’s deed is void, but she has not
disputed the validity of the deed of trust. When there is no dispute as to the validity
of a deed of trust containing a tenancy at sufferance provision, the tenancy provides
a basis for resolving the possession issue, regardless of any title dispute. Gardocki,
2013 WL 6568765, at *3; Yarbrough, 455 S.W.3d at 282. In cases in which the court
concludes a title issue is intertwined with the possession issue, either: (1) the
10
defendant challenges the validity of the deed of trust establishing the tenancy
relationship; or (2) there is no tenancy at sufferance provision. E.g., Yarbrough, 455
S.W.3d at 283 (concluding title issue intertwined with possession issue when
defendants claimed deed of trust was void due to forgery); Chinyere v. Wells Fargo
Bank, N.A., 440 S.W.3d 80, 85 (Tex. App.—Houston [1st Dist.] 2012, no pet.)
(concluding title issue intertwined with possession issue when neither deed of trust
nor substitute trustee’s deed contained language creating landlord–tenant
relationship). Neither of these circumstances are present in this case.
Although Angelino has raised a title dispute, the mere existence of a title
dispute does not deprive the lower courts of jurisdiction. Yarbrough, 455 S.W.3d at
280. The dispute here is based on a defect in the foreclosure proceeding, which is
not so intertwined with the issue of possession as to deprive the lower courts of
jurisdiction. Thus, the justice court and county court had jurisdiction to decide this
forcible detainer action.
We overrule Angelino’s first issue.
Ownership of the Property
Next, Angelino argues the trial court erred in granting summary judgment
because Shafaii Investments failed to conclusively establish the ownership element
of its forcible detainer action. Like her jurisdictional argument, Angelino also bases
this argument on the fact that Shafaii Investments never tendered the foreclosure bid
11
price to the substitute trustee. Angelino argues that Shafaii Investments did not
actually buy the property at the foreclosure sale, so the substitute trustee’s deed is
void and does not establish that Shafaii Investments owns the property.
Applicable Law
A plaintiff must establish the plaintiff owns the property to prevail in a
forcible detainer action. Shields, 526 S.W.3d at 478. But the plaintiff does not need
to prove title, only “sufficient evidence of ownership to demonstrate a superior right
to immediate possession.” Rice, 51 S.W.3d at 709; see also Kaldis v. Aurora Loan
Servs., No. 01-09-00270-CV, 2010 WL 2545614, at *3 (Tex. App.—Houston [1st
Dist.] June 24, 2010, pet. dism’d w.o.j.) (mem. op.). A plaintiff can prove this
superior right to immediate possession with a substitute trustee’s deed following a
foreclosure sale. Kaldis, 2010 WL 2545614, at *3. The substitute trustee’s deed is
sufficient to establish the superior right of possession, even if the opposing party
claims there were defects in the foreclosure proceeding and challenges the substitute
trustee’s deed. Id.; e.g., Dormady, 61 S.W.3d at 558–59 (holding purchaser of
property at foreclosure sale had superior right of possession despite tenant’s claim
that trustee’s deed was void because of foreclosure defects).
We review summary judgments de novo. Lujan v. Navistar, Inc., 555 S.W.3d
79, 84 (Tex. 2018). A party moving for traditional summary judgment, as here, must
prove that there is no genuine issue of material fact and that the movant is entitled
12
to judgment as a matter of law. Id.; TEX. R. CIV. P. 166a(c). If the movant does so,
the burden shifts to the nonmovant to raise a genuine issue of material fact. Lujan,
555 S.W.3d at 84. We take as true all evidence favoring the nonmovant, indulging
every reasonable inference and resolving any doubts in the nonmovant’s favor. Id.
Analysis
Angelino argues Shafaii Investments failed to establish ownership because
Shafaii Investments did not tender the foreclosure bid price to the substitute trustee,
so it did not buy the property at the foreclosure sale and the substitute trustee’s deed
is void.
However, Angelino again is essentially arguing a defect in the foreclosure
process. In a forcible detainer action, a substitute trustee’s deed is sufficient to
establish a superior right of possession, even if there were defects in the foreclosure
process. Kaldis, 2010 WL 2545614, at *3; see also Dormady, 61 S.W.3d at 558–59.
Angelino does not dispute that Shafaii Investments offered as summary judgment
evidence a substitute trustee’s deed that, on its face, establishes Shafaii Investments
purchased the property at the foreclosure sale. Whether defects in the foreclosure
process voided the substitute trustee’s deed is an issue to be resolved in an action for
wrongful foreclosure or to set aside the substitute trustee’s deed, not a forcible
detainer action. See Lua, 646 S.W.3d at 630.
13
Angelino similarly argues that there is a genuine issue of material fact as to
whether the property was sold at the foreclosure sale, and the tenancy at sufferance
provision in her deed of trust only takes effect when the property is sold. Again,
these alleged defects in the foreclosure process must be resolved in an action for
wrongful foreclosure or to set aside the substitute trustee’s deed, not a forcible
detainer action. See id.
Shafaii Investments provided the substitute trustee’s deed demonstrating it
had a superior right to immediate possession of the property. See Kaldis, 2010 WL
2545614, at *3; Rice, 51 S.W.3d at 709. Therefore, Shafaii Investments conclusively
proved the ownership element of its forcible detainer action.
We overrule Angelino’s second issue.
Proper Notice
Angelino next argues the trial court erred in granting summary judgment
because Shafaii Investments failed to conclusively establish that it provided the
notice required by Section 24.005 of the Property Code.
Applicable Law
A landlord must establish it provided proper statutory notice to prevail in a
forcible detainer action. Shields, 526 S.W.3d at 478; Gore v. Homecomings Fin.
Network, Inc., No. 05-06-01701-CV, 2008 WL 256830, at *2 (Tex. App.—Dallas
Jan. 31, 2008, no pet.) (mem. op.). Forcible detainer is a statutory cause of action,
14
so a landlord must strictly comply with all statutory requirements. Mendoza v.
Bazan, 574 S.W.3d 594, 607 (Tex. App.—El Paso 2019, pet. denied); Kennedy v.
Andover Place Apartments, 203 S.W.3d 495, 497 (Tex. App.—Houston [14th Dist.]
2006, no pet.).
The Property Code requires a landlord to give a tenant under a written lease
at least three days’ written notice to vacate the premises before filing a forcible
detainer action, unless the parties have contracted for a different notice period. TEX.
PROP. CODE § 24.005(a). The landlord must give the notice to vacate in person or by
mail at the property in question. Id. § 24.005(f). The landlord can send the notice to
vacate by regular mail, by registered mail, or by certified mail, return receipt
requested, to the property in question. Id.
Typically, a landlord proves it mailed a notice to vacate with a business
records affidavit of the entity that sent the notice—often the landlord’s counsel—
stating the notice to vacate was mailed by regular mail and certified mail, along with
copies of the written notice and the envelopes showing the proper address and
postage. See, e.g., Perez v. Fed. Home Loan Mortg. Corp., No. 08-14-00249-CV,
2016 WL 4538528, at *4 (Tex. App.—El Paso Aug. 31, 2016, no pet.) (mem. op.)
(concluding landlord sufficiently proved it mailed notice to vacate with counsel’s
business records affidavit that stated notice was mailed by both certified and first
15
class mail and included copies of notice letter along with first class and certified mail
envelopes showing proper address and prepaid postage).
Further, the affidavit should note whether either of the notices were returned
as undelivered. See id. (concluding landlord sufficiently proved notice in part
because business records affidavit averred properly addressed first class mail
envelope was not returned); Farkas v. Fed. Nat’l Mortg. Ass’n, No. 05-11-01416-
CV, 2012 WL 5351262, at *3 (Tex. App.—Dallas Oct. 31, 2012, no pet.) (mem. op.)
(concluding landlord sufficiently proved notice when custodian of records for
landlord’s counsel testified that he sent notice by certified mail and regular mail, that
it was standard practice to add returned letters to appropriate file, that if first-class
mail had been returned he would have found evidence of that in appropriate file, and
that there was no evidence in file that first-class mail had been returned); cf. Rose v.
Pierre, No. 01-22-00418-CV, 2023 WL 3357658, at *4–5 (Tex. App.—Houston [1st
Dist.] May 11, 2023, no pet.) (mem. op.) (concluding landlord did not prove notice
when there was no copy of written notice in evidence or any evidence that notice
was delivered in person or by mail); Gore, 2008 WL 256830, at *2 (concluding
landlord did not prove notice by mail when first-class mail envelope was labeled
“return to sender” and certified mail receipts showed sections for date of delivery,
signature, and printed name of receiving party were blank).
16
Again, we review summary judgments de novo. Lujan, 555 S.W.3d at 84. A
party moving for traditional summary judgment, as here, must prove that there is no
genuine issue of material fact and that the movant is entitled to judgment as a matter
of law. Id.; TEX. R. CIV. P. 166a(c). If the movant does so, the burden shifts to the
nonmovant to raise a genuine issue of material fact. Lujan, 555 S.W.3d at 84. We
take as true all evidence favoring the nonmovant, indulging every reasonable
inference and resolving any doubts in the nonmovant’s favor. Id.
Analysis
Angelino argues that Shafaii Investments failed to conclusively establish it
provided notice as required by Section 24.005 of the Property Code because: (1) Raj
Shafaii’s business records affidavit lacked personal knowledge and thus was
insufficient; and (2) Shafaii Investments did not prove it mailed the notice to vacate.
Angelino argues Raj Shafaii’s business records affidavit lacked personal
knowledge and thus the trial court erred in overruling her objection to the affidavit.
His affidavit stated he was a custodian of the business records of Shafaii Investments
and that on January 11, 2022, Shafaii Investments through its attorneys mailed a
notice to vacate to Angelino. The affidavit further stated the notice was mailed by
regular mail and certified mail, return receipt requested. A copy of the notice was
attached to the affidavit. Angelino argues the affidavit is not based on Raj Shafaii’s
personal knowledge because he did not personally mail the notice, and the affidavit
17
does not explain how he supposedly obtained personal knowledge of his attorneys’
mailing of the notice. But Texas Rule of Evidence 803(6), the business record
exception to the hearsay rule, does not require that the witness laying the predicate
for admission of a document be the creator of the document or even an employee of
the same company as the creator. See TEX. R. EVID. 803(6); Rizvi v. Am. Express
Nat’l Bank, No. 02-19-00197-CV, 2020 WL 3969585, at *8 (Tex. App.—Fort Worth
June 18, 2020, no pet.) (mem. op.). Nor does the rule require that the witness have
personal knowledge of the information recorded in the document. Rizvi, 2020 WL
3969585, at *8 (explaining that records custodian need only have personal
knowledge of manner in which records were kept).
Even without considering Raj Shafaii’s affidavit, there is conclusive evidence
in the appellate record that Shafaii Investments mailed notice to Angelino and that
Angelino received it. But the parties dispute whether we may properly consider this
evidence. Shafaii Investments refers us to a certified mail receipt with Angelino’s
name, dated January 11, 2022, and a return receipt or “green card” listing Angelino’s
address and bearing a signature that reads “Margarita Trujillo.” These receipts are
attached to a copy of the notice to vacate, also dated January 11, 2022, and
authenticated by the business records affidavit of Shafaii Investments’ attorney at
the time.
18
Shafaii Investments did not attach the receipts to its motion for summary
judgment, instead relying on Raj Shafaii’s affidavit stating his attorneys mailed the
notice. The trial court initially denied Shafaii Investments’ motion for summary
judgment.
Then, on July 14, 2022, Shafaii Investments filed three exhibits for
preadmission that it intended to introduce at trial. More than two months later, the
trial court held a pretrial hearing. The parties both announced ready for trial, and
Shafaii Investments asked that the three exhibits it had previously filed, including
the receipts, be preadmitted. The trial court asked Angelino if she had any objections;
she did not indicate that she had any. The trial court then admitted the exhibits,
including the receipts.
Later, during the same pretrial hearing, the trial court reconsidered its ruling
on Shafaii Investments’ motion for summary judgment. The trial court expressed
doubt that there were any triable fact issues in the case. Shafaii Investments agreed
there were none. When the trial court asked Angelino what the triable fact issues
were, she said Shafaii Investments’ standing to bring suit, but the trial court
disagreed that was an issue in this case. Angelino did not mention any dispute about
whether Shafaii Investments mailed, or she received, the notice. The trial court then
granted Shafaii Investments’ motion for summary judgment. In its written order
granting summary judgment, the trial court recited: “[T]he Court finds that the
19
evidence presented conclusively established that Shafaii Investments, Ltd. is entitled
to immediate possession of the subject property . . . .”
Now, on appeal, Shafaii Investments argues the receipts clearly show that
Angelino received the notice to vacate. Angelino argues, however, that the receipts
were not attached to or referenced in Shafaii Investments’ motion for summary
judgment, and therefore this evidence is not part of the summary judgment record.
She argues that unless the appellate record indicates the trial court considered
evidence outside the summary judgment record, we may not consider the evidence
on appeal. We disagree with Angelino’s argument that we may not consider the
receipts on appeal for two reasons.
First, the appellate record indicates the trial court did consider this evidence.
The receipts are akin to late-filed summary judgment evidence. When a party files
evidence after the deadline prescribed by Texas Rule of Civil Procedure 166a(c),2
we presume the trial court did not consider the evidence without an affirmative
indication in the record, but a trial court’s recital that it considered the evidence
2
That rule provides:
Except on leave of court, with notice to opposing counsel, the motion and
any supporting affidavits shall be filed and served at least twenty-one
days before the time specified for hearing. Except on leave of court, the
adverse party, not later than seven days prior to the day of hearing may
file and serve opposing affidavits or other written response.
TEX. R. CIV. P. 166a(c).
20
presented, without any limitation, is an affirmative indication the trial court
considered the late-filed evidence. See B.C. v. Steak N Shake Operations, Inc., 598
S.W.3d 256, 260–62 (Tex. 2020) (per curiam). There is no dispute here that the
receipts were presented to the trial court, and the trial court admitted them without
objection at the same pretrial hearing during which it considered the motion for
summary judgment. In its order, the trial court recited that the evidence presented
conclusively established Shafaii Investments was entitled to immediate possession
of the property. The record thus establishes the trial court considered the evidence,
including the receipts, and we may thus consider the receipts on appeal.
Second, the facts of this case are similar to those in Balmorhea Ranches, Inc.
v. Heymann, 656 S.W.3d 441 (Tex. App.—El Paso 2022, no pet.). In that case, after
both parties filed motions for summary judgment and before the trial court ruled, the
parties filed joint stipulations. Id. at 446. “[T]he trial court allowed [the] filing of
stipulations and no objection was raised or soon followed.” Id. The trial court later
granted one of the summary judgment motions, stating that it considered the joint
stipulations along with the pleadings, responses, and arguments of counsel. Id. at
445–46. The appellant argued that no party asked the court to consider the
stipulations as part of its summary judgment ruling or incorporated them by
reference into the summary judgment record, and thus the trial court erred in
considering this evidence that was outside the summary judgment record. Id. at 446.
21
The appellate court disagreed and concluded there was no error. Id. at 446–47.
Stipulations, by definition, let the trial court know what is not in dispute and where
there is “no genuine issue.” Id. (quoting TEX. R. CIV. P. 166a(c)).
Similarly, in this case, Shafaii Investments submitted evidence after filing a
motion for summary judgment but before the trial court ruled on the motion, and
Angelino did not raise any objection or indicate the evidence was disputed. The trial
court later granted Shafaii Investments’ motion for summary judgment and stated it
considered the evidence presented. As in Balmorhea Ranches, the trial court did not
err in relying on this evidence. See id. at 447.
Although Shafaii Investments submitted the evidence after filing its motion
for summary judgment, the trial court admitted the evidence, including the receipts,
at the same pretrial hearing during which the trial court later considered and ruled
on the motion. After the trial court admitted the receipts, and after Angelino
indicated the only triable issue was the issue of standing, the trial court granted the
summary judgment motion. On this record, we conclude that the evidence was
properly before the trial court when it ruled on the motion for summary judgment
and that the court did not err in concluding there was no issue of material fact
precluding summary judgment. The receipts, which were properly before the trial
court, conclusively established Shafaii Investments mailed, and Angelino received,
the notice to vacate.
22
Relying on the Black’s Law Dictionary definition of “mail,”3 Angelino next
argues Shafaii Investments provided no conclusive evidence that the notice to vacate
was delivered in a properly addressed envelope, stamped with proper postage, or
deposited in a proper place for the receipt of mail.
Shafaii Investments did not provide copies of the envelopes it used to mail the
notice showing the proper address and postage or evidence that the mail was not
returned undelivered, which are ordinarily used to establish mailing. See, e.g., Perez,
2016 WL 4538528, at *4; Farkas, 2012 WL 5351262, at *3. But the certified mail
receipt and return receipt are conclusive evidence that Shafaii Investments mailed
notice to Angelino’s address and that she received the notice. See TEX. PROP. CODE
§ 24.005(f) (landlord may send notice to vacate by certified mail, return receipt
requested, to property in question); see also U.S. Bank, Nat’l Ass’n v. Khan, No. 05-
14-00903-CV, 2015 WL 4736839, at *2 (Tex. App.—Dallas Aug. 11, 2015, no pet.)
(mem. op.) (return receipt confirmations established landlord sent notice by mail to
property and therefore complied with Section 24.005). Angelino offered no evidence
to the contrary. Therefore, Shafaii Investments conclusively proved that it strictly
complied with the Property Code’s notice requirements.
3
Black’s Law Dictionary defines the verb “mail” as “[t]o deposit (a letter, package,
etc.) with the U.S. Postal Service; to ensure that a letter, package, etc. is properly
addressed, stamped, and placed into a receptacle for mail pickup.” Mail, BLACK’S
LAW DICTIONARY (11th ed. 2019).
23
In her motion for rehearing, Angelino argues for the first time that Shafaii
Investments’ evidence creates a genuine issue of material fact precluding summary
judgment. She points to two different versions of Shafaii Investments’ notice to
vacate and argues that both cannot be “a true and correct copy of the notice to vacate
that was allegedly mailed.” She also argues that the signature on the return receipt
does not match her signature on one of the court documents she signed. However,
Angelino did not raise these factual issues in the trial court in either her summary-
judgment response or at the summary-judgment hearing, and therefore she has
waived these issues on appeal. See TEX. R. CIV. P. 166a(c); City of Houston v. Clear
Creek Basin Auth., 589 S.W.2d 671, 678 (Tex. 1979) (holding summary-judgment
nonmovant could not raise for first time on appeal additional fact issue that was not
raised in its response); Fred Loya Ins. Agency, Inc. v. Cohen, 446 S.W.3d 913, 925
(Tex. App.—El Paso 2014, pet. denied) (same).
We overrule Angelino’s third issue.
Attorney’s Fees
Lastly, Angelino argues the trial court erred in awarding conditional appellate
attorney’s fees to Shafaii Investments on summary judgment for two reasons:
(1) Shafaii Investments did not establish Angelino received the statutorily required
notice, which is a prerequisite to recovering attorney’s fees; and (2) Shafaii
24
Investments did not provide sufficient evidence of the reasonable amount to be
awarded.
In a letter brief to this court, Angelino also argues that Shafaii Investments did
not address this argument in its appellate brief, except for a single conclusory
statement, and therefore Shafaii Investments has waived any arguments on this issue.
But an appellee who prevails in the trial court does not need to raise arguments in
support of the trial court’s judgment in its appellate brief and does not waive an issue
by failing to do so. In re G.X.H., 627 S.W.3d 288, 295 (Tex. 2021). The Texas Rules
of Appellate Procedure do not require an appellee to file a brief at all. In the event
the appellee does not file a brief, or does not substantively address an issue in its
brief, we are still obligated to independently examine the merits of the appellant’s
arguments. See Burns v. Rochon, 190 S.W.3d 263, 267 n.1 (Tex. App.—Houston
[1st Dist.] 2006, no pet.) (explaining court would independently review appellant’s
claims after appellee’s brief had been struck).
Applicable Law
A landlord who prevails in a forcible detainer action and who provides written
notice in accordance with Section 24.006(a) of the Property Code is entitled to
recover reasonable attorney’s fees from the tenant. TEX. PROP. CODE § 24.006(b).
Section 24.006(a) requires a landlord, at least 10 days before filing suit, to give a
tenant a written demand to vacate the property by registered mail or by certified
25
mail, return receipt requested. Id. § 24.005(a). The demand must state that “if the
tenant does not vacate the premises before the 11th day after the date of receipt of
the notice and if the landlord files suit, the landlord may recover attorney’s fees.” Id.
Again, because forcible detainer is a statutory cause of action, a landlord must
strictly comply with all statutory requirements. Mendoza, 574 S.W.3d at 607;
Kennedy, 203 S.W.3d at 497. Failure to strictly comply with statutory requirements
“is fatal” to a claim for attorney’s fees. See Heimlich v. Cook, No. 14-22-00358-CV,
2023 WL 3596264, at *5 (Tex. App.—Houston [14th Dist.] May 23, 2023, no pet.)
(mem. op.).
A trial court may award conditional appellate attorney’s fees to a party. These
are “essentially an award of fees that have not yet been incurred and that the party is
not entitled to recover unless and until the appeal is resolved in that party’s favor.”
Ventling v. Johnson, 466 S.W.3d 143, 156 (Tex. 2015). And while the Supreme
Court strongly favors the lodestar method for shifting attorney’s fees,4 that method
does not work for conditional appellate attorney’s fees that have not yet been
4
The lodestar method “is a focused and objective analysis of whether the [attorney’s]
fees sought are reasonable and necessary.” Rohrmoos Venture v. UTSW DVA
Healthcare, LLP, 578 S.W.3d 469, 496 (Tex. 2019). Under the lodestar method, a
fee claimant bears the burden of providing sufficient evidence of “(1) particular
services performed, (2) who performed those services, (3) approximately when the
services were performed, (4) the reasonable amount of time required to perform the
services, and (5) the reasonable hourly rate for each person performing such
services.” Id. at 498.
26
incurred and can only be projected based on an expert’s opinion testimony. Yowell
v. Granite Operating Co. (Yowell II), 620 S.W.3d 335, 355 (Tex. 2020). When a trial
court awards attorney’s fees, “any appeal is still hypothetical.” Id. “There is no
certainty regarding who will represent the appellee in the appellate courts, what
counsel’s hourly rate(s) will be, or what services will be necessary to ensure
appropriate representation in light of the issues the appellant chooses to raise.” Id.The party seeking conditional appellate attorney’s fees must still support the fee
award with expert testimony “about the services it reasonably believes will be
necessary to defend the appeal and a reasonable hourly rate for those services.” Id.In all summary judgment cases, to recover attorney’s fees, a party moving for
summary judgment must plead the request for attorney’s fees and include the request
and evidence to support the request in the motion for summary judgment, usually
with an affidavit from the movant’s attorney. Vertical Holdings, LLC v. LocatorX,
Inc., No. 05-22-00720-CV, 2023 WL 5949023, at *5–6 (Tex. App.—Dallas Sept.
13, 2023, pet. denied) (mem. op.). “The affidavit acts as ‘expert testimony’ to
support the reasonableness of the requested attorney fees.” Id.We may not uphold a trial court’s award of attorney’s fees unless the record
contains sufficient evidence to support the award. See Yowell II, 620 S.W.3d at 354.
“The party seeking attorney’s fees bears the burden of proof” to support the trial
27
court’s award. Id. If the evidence supporting the award is insufficient, we must
reverse. Id.
Analysis
Angelino argues that Shafaii Investments failed to prove Angelino received
notice. However, as discussed above, the certified mail receipt and return receipt,
with Angelino’s correct address and signature, establish that Shafaii Investments
mailed the notice and that Angelino received it. The date on the certified mail receipt
matches the date on the notice. The notice states, “Notice under Sec. 24.006(a), Tex.
Prop. Code. If you do not vacate the premises before the 11th day after the date of
receipt of this notice to vacate and if the landlord (Shafaii) files suit, the landlord
may recover attorney’s fees.” Therefore, Shafaii Investments provided conclusive
evidence that it mailed by certified mail and Angelino received a written demand to
vacate the property with the required statutory language. See TEX. PROP. CODE
§ 24.006(a), (b).
Angelino also argues that Shafaii Investments did not provide sufficient
evidence to support the amount of conditional appellate attorney’s fees it sought for
four reasons. We address each reason in turn and conclude that Shafaii Investments
provided sufficient evidence to support the trial court’s award of conditional
appellate attorney’s fees.
28
First, Angelino argues the attorney’s fee affidavit submitted by Shafaii
Investments’ attorney does not provide the evidence required under the lodestar
method: evidence of which tasks would be required for an appeal, the number of
hours required to perform those tasks, or who would be performing those tasks.
However, a movant is not required to provide the evidence for a conditional award
that it would typically be required to provide under the lodestar method for an award
of fees already incurred. See Yowell II, 620 S.W.3d at 355. The lodestar analysis
does not apply to an award of conditional appellate attorney’s fees. See id.; QJD
Peking Duck Rest., Inc. v. TCP Spectrum Partners, Ltd., No. 01-22-00545-CV, 2023
WL 5436907, at *3 (Tex. App.—Houston [1st Dist.] Aug. 24, 2023, no pet.) (mem.
op.). Thus, the lack of evidence under the lodestar method here does not affect the
award of conditional appellate attorney’s fees.
Second, Angelino argues the attorney’s fee affidavit does not describe the
specific services that would be necessary to defend an appeal. See Yowell II, 620
S.W.3d at 355 (explaining that party seeking to recover contingent appellate fees
must provide “opinion testimony about the services it reasonably believes will be
necessary to defend the appeal and a reasonable hourly rate for those services”).
Shafaii Investments’ attorney’s fee affidavit describes the testifying attorney’s
experience and “familiar[ity] with the fees customarily charged by attorneys in
Harris County for handling suits on similar claims and . . . familiar[ity] with the
29
attorney’s services normally required for the proper prosecution of lawsuits like this
one.” The affidavit then states, in relevant part:
If the summary judgment is granted, becomes final, and is then
appealed, in my opinion, taking into consideration the complexity of
this case, the legal questions involved, and the time involved, a
reasonable attorneys’ fee for an appeal to the court of appeals would be
$5,000.00. If a petition for review is filed in the Texas Supreme Court,
in my opinion, a reasonable additional attorneys’ fee would be
$2,500.00. If the Texas Supreme Court grants the petition for review,
in my opinion, a reasonable additional attorneys’ fee could be
$3,500.00. My hourly rate is $480.00 and [my co-counsel’s] hourly rate
is $330.00.
This affidavit separates the amounts necessary for an appeal to the intermediate court
of appeals and to the Supreme Court and states the attorneys’ rates for their services.
Although some attorney’s fee affidavits identify particular services involved in an
appeal, all appeals involve researching, preparing, and drafting a brief, so remanding
this case for a more specific description of particular services would provide little if
any benefit. See QJD Peking Duck Rest., 2023 WL 5436907, at *4 (affirming
appellate attorney’s fee award based on attorney’s opinion of reasonable fee for
“researching, preparing, and drafting a brief” to intermediate appeals court and
Supreme Court as well as attorney’s hourly billing rate). Further, unlike the lodestar
method, the standard described in Yowell for conditional appellate attorney’s fees
does not require an attorney’s testimony to describe the number of hours required to
perform particular services or the identity of the attorney performing the particular
services.
30
The attorney’s fee affidavit Shafaii Investments offered in this case is at least
as specific as the testimony the Supreme Court affirmed in Yowell.5 See Yowell II,
620 S.W.3d at 356 (affirming court of appeals’ judgment on issue of attorney’s fees,
which in turn affirmed trial court’s judgment, because there was legally sufficient
evidence to support award). In Yowell, the intermediate appeals court explained that
the attorney seeking fees testified “concerning his experience handling this type of
litigation and his familiarity with reasonable fees charged in the Texas Panhandle by
attorneys of varying degrees of experience.” Yowell v. Granite Operating Co.
(Yowell I), 557 S.W.3d 794, 808 (Tex. App.—Amarillo 2018), aff’d in part, rev’d in
part, Yowell II, 620 S.W.3d at 356. He then provided testimony on each of the
lodestar factors for “the total hours spent on the case so far.” Id. For conditional
appellate attorney’s fees, he testified that:
in his opinion, $22,000 would be a reasonable fee for handling the case
through an appeal to this Court; $7,500 would be a reasonable fee for
5
Shafaii Investments made this argument for the first time in its response, which we
requested, to Angelino’s motion for rehearing. Angelino argued that Shafaii
Investments waived this argument by raising it for the first time in a motion for
rehearing. However, there is a distinction between arguments and issues. A party
may not raise a new issue in a motion for rehearing, but a party may raise additional
arguments in support of its position. See Chen v. Razberi Techs., Inc., 645 S.W.3d
773, 778 n.23 (Tex. 2022) (“New arguments subsumed within the issues argued
below can be raised for the first time in a motion for rehearing.”); Greene v. Farmers
Ins. Exch., 446 S.W.3d 761, 764 n.4 (Tex. 2014) (“We do not consider issues that
were not raised in the courts below, but parties are free to construct new arguments
in support of issues properly before the Court.”). Shafaii Investments did not raise
the issue of appellate attorney’s fees; it simply constructed a new argument in
response to Angelino’s issue. We therefore disagree with Angelino that Shafaii
Investments waived our consideration of this argument.
31
handling a petition for review to the Supreme Court; $9,000 would be
a reasonable fee for briefing on the merits; and $5,000 would be a
reasonable fee for representation through oral argument and completion
of proceedings in the Supreme Court.
Id. The trial court awarded the full amount of conditional appellate attorney’s fees
sought, and the Amarillo Court of Appeals affirmed this award. Id. at 809. The
appeals court noted that the opposing party “did not cross-examine the witness
regarding his estimates for attorneys’ fees on appeal, present any additional evidence
on the issue of appellate attorneys’ fees, or otherwise contest his testimony on what
a reasonable fee would be in the appeal of this case.” Id. at 808.
The Texas Supreme Court then “independently reviewed the record” and
concluded the “uncontroverted evidence” regarding attorney’s fees was sufficient,
and the Court affirmed the court of appeals’ judgment on the issue of attorney’s fees.
Yowell II, 620 S.W.3d at 355–56.
Therefore, if the evidence supporting conditional appellate attorney’s fees in
Yowell was sufficient, the uncontroverted evidence offered in this case is likewise
sufficient to support the fee award. See id.; see also State & Cnty. Mut. Fire Ins. Co.
v. Walker, 228 S.W.3d 404, 408–10 (Tex. App.—Fort Worth 2007, no pet.) (cited
favorably by Texas Supreme Court in Yowell and holding attorney’s uncontroverted
testimony as to what he believed “a reasonable attorney’s fee would be for the
services that would ‘necessarily need to be rendered’ in the event of an appeal” was
sufficient evidence to support appellate attorney’s fee award). In claiming otherwise,
32
Angelino argues that more evidence is required than what the Supreme Court
actually required in Yowell.
Third, Angelino argues Shafaii Investments’ attorney’s fee affidavit is
conclusory and therefore not readily controvertible. But for the reasons discussed
above, the attorney’s fee affidavit provides sufficient detail about the rate and fees
reasonably necessary for an appeal. Angelino could have presented, but did not
present, controverting evidence. See Yowell I, 557 S.W.3d at 808 (affirming
conditional attorney’s fee award in part because opposing party “did not cross-
examine the witness regarding his estimates for attorneys’ fees on appeal, present
any additional evidence on the issue of appellate attorneys’ fees, or otherwise contest
his testimony on what a reasonable fee would be in the appeal of this case”).
Fourth, and lastly, Angelino argues that binding precedent from this court
requires a finding that the attorney’s fee affidavit is insufficient to support the award
of attorney’s fees, citing Walsh v. Gonzalez, No. 01-21-00729-CV, 2023 WL
4110851 (Tex. App.—Houston [1st Dist.] June 22, 2023, no pet.) (mem. op.).
However, Walsh is distinguishable. In that case, the attorney simply offered
testimony that: “If this is appealed, [she] would estimate that the attorney’s fees on
appeal would be approximately $10,000 to the appellate court and $10,000 to the
Texas Supreme Court.” Id. at *11 (alteration in original). Because the attorney did
not testify to the services she reasonably believed would be necessary for appeal or
33
the hourly rate for those services, a panel of this court concluded the testimony was
insufficient to support the award of appellate attorney’s fees. Id. at *12 (citing Yowell
II, 620 S.W.3d at 355). The panel also noted the trial court erred in awarding
appellate attorney’s fees that were not contingent on the results of any appeal. Id. at
*11 n.6.
In this case, however, the attorney’s fee affidavit describes the “reasonable
attorneys’ fee for an appeal to the court of appeals,” for responding to a petition for
review in the Texas Supreme Court, and for briefing the issue to the Texas Supreme
Court if it granted review. The affidavit also states the hourly rate for those services.
Further, unlike the trial court in Walsh, here the trial court conditioned the award of
appellate attorney’s fees on Angelino’s unsuccessful appeals to the court of appeals
and Texas Supreme Court. Also, in Walsh, the party who was awarded attorney’s
fees only prevailed on some issues on appeal. She was only entitled to recover
attorney’s fees for those issues on which she prevailed, and she needed to segregate
her recoverable fees from the unrecoverable fees. Id. at *12. Here, Shafaii
Investments has prevailed on each appellate issue, so no segregation is necessary.
In sum, Shafaii Investments’ attorney’s fee affidavit provided sufficient
evidence to support the trial court’s award of conditional appellate attorney’s fees in
accordance with the standard the Supreme Court articulated in Yowell. Further, that
evidence was not conclusory, it was uncontroverted in the trial court, and it was more
34
detailed than evidence this court has previously found insufficient. Cf. Walsh, 2023
WL 4110851, at *11–12. Therefore, we overrule Angelino’s fourth issue.
CONCLUSION
We affirm the trial court’s judgment.
Gordon Goodman
Justice
Panel consists of Justices Goodman, Rivas-Molloy, and Guerra.
35