Kennard Law, P.C. v. Lamar Texas Limited Partnership

Affirmed in Part, Reversed in Part, and Remanded, and Memorandum
Opinion filed July 13, 2021.
In The
Fourteenth Court of Appeals
NO. 14-19-00819-CV
KENNARD LAW, P.C., Appellant
V.
LAMAR TEXAS LIMITED PARTNERSHIP, Appellee
On Appeal from the County Court at Law No. 2
Fort Bend County, Texas
Trial Court Cause No. 17-CCV-059600
MEMORANDUM OPINION
After appellant Kennard Law, P.C. (Kennard) failed to appear for trial, the
trial court signed a post-answer default judgment against Kennard in favor of
appellee Lamar Texas Limited Partnership (Lamar). In issue one, Kennard argues
that the trial court erred in denying its plea to the jurisdiction because the trial court
lacked subject-matter jurisdiction over Lamar’s claims. In issue two, Kennard
argues the trial court erred in rendering a default judgment after Kennard had filed
an answer and that Lamar failed to prove all aspects of its case. We affirm in part
as to issue one and affirm in part and reverse in part as to the trial court’s award of
attorney’s fees in issue two.
I. BACKGROUND
Lamar brought a suit on a sworn account in March 2017 against Kennard in
Fort Bend County alleging that Kennard owed $33,867.50 for unpaid billboard
advertisements. Kennard answered with an unverified general denial. Kennard
never objected to venue but filed a plea to the jurisdiction in August 2019, alleging
that Kennard is headquartered in Harris County and that the facts underlying the
suit have no connection to Fort Bend County.
In September 2019, Kennard failed to appear for trial, and the trial court
signed a default final judgment awarding damages, pre- and post-judgment
interest, attorney’s fees, and costs to Lamar and against Kennard. There is no
reporter’s record of the bench trial. Though Kennard argues in this appeal that the
failure to appear was due to a scheduling conflict, Kennard did not file a motion
for new trial, and instead filed a notice of appeal of the default final judgment.
II. ANALYSIS
A. Subject-matter jurisdiction
Kennard argues that the trial court erred in denying its plea to the
jurisdiction because the trial court lacked subject-matter jurisdiction to hear
Lamar’s case in Fort Bend County. “[S]ubject-matter jurisdiction is essential to a
court’s power to decide a case.” Bland Indep. Sch. Dist. v. Blue, 34 S.W.3d 547,
553–54 (Tex. 2000). Consequently, a court cannot render a binding judgment
concerning matters over which it lacks subject-matter jurisdiction. See In re United
Servs. Auto. Ass’n, 307 S.W.3d 299, 309 (Tex. 2010) (orig. proceeding).
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Determining whether a trial court had subject-matter jurisdiction is a question of
law, which we review de novo. City of Hous. v. Rhule, 417 S.W.3d 440, 442 (Tex.
2013) (per curiam).
Subject-matter jurisdiction is the power of a court to hear and determine
cases of a general class to which the case in question belongs. Mladenka v.
Mladenka, 130 S.W.3d 397, 400 (Tex. App.—Houston [14th Dist.] 2004, no pet.).
For courts of general jurisdiction such as our state district courts, subject-matter
jurisdiction usually is presumed, absent a showing to the contrary. Dubai
Petroleum Co. v. Kazi, 12 S.W.3d 71, 75 (Tex. 2000); see Tex. Const. art. V, § 8
(“District Court jurisdiction consists of exclusive, appellate, and original
jurisdiction of all actions, proceedings, and remedies, except in cases where
exclusive, appellate, or original jurisdiction may be conferred by this Constitution
or other law on some other court, tribunal, or administrative body.”). But county
courts at law are courts of limited jurisdiction. United Servs. Auto. Ass’n v. Brite,
215 S.W.3d 400, 401 (Tex. 2007). Because jurisdiction in such courts is not
presumed, the authority to adjudicate the claims presented must be established at
the outset of the case. See Kazi, 12 S.W.3d at 75. A plaintiff filing a pleading
asserting a claim must “allege facts that affirmatively demonstrate the court’s
jurisdiction to hear the cause.” See Texas Ass’n of Bus. v. Texas Air Control Bd.,
852 S.W.2d 440, 446 (Tex. 1993).
A Fort Bend county court at law has jurisdiction over all causes and
proceedings, civil and criminal, original and appellate, prescribed by law for a
county court. Tex. Gov’t Code Ann. § 25.0003(a); see also Tex. Gov’t Code Ann.
§ 25.0812 (jurisdiction of Fort Bend county courts at law). Fort Bend county courts
at law also have original jurisdiction in civil cases based on the value of the
“matter in controversy.” Tex. Gov’t Code Ann. § 25.0003(c)(1) (civil cases in
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which matter in controversy exceeds $500 but does not exceed $250,000). Here,
Lamar’s petition alleged a civil claim with an amount in controversy between $250
and $250,000. Therefore, Lamar pleaded sufficient facts to invoke the subject-
matter jurisdiction of the trial court.
Kennard does not identify any facts or legal issues that demonstrate the trial
court lacked subject-matter jurisdiction. Instead, Kennard explains that it is
headquartered in Harris County, and that “the actions for the basis of this lawsuit
occurred in the Rio Grande Valley.” Kennard’s arguments track the general rule
for counties of proper venue in the Civil Practice and Remedies Code. See Tex.
Civ. Prac. & Rem. Code Ann. § 15.002(a)(1), (3). Though Kennard’s arguments
appear to address venue rather than subject-matter jurisdiction, Kennard never
challenged venue in the trial court and therefore did not preserve any error for this
court to review with respect to venue. See Tex. R. Civ. P. 86 (“An objection to
improper venue is waived if not made by written motion filed prior to or
concurrently with any other plea, pleading or motion”); Tex. R. App. P. 33.1(a).
We conclude that the trial court did not err in denying Kennard’s plea to the
jurisdiction.
We overrule Kennard’s issue one.
B. The post-answer default judgment
In issue two, Kennard argues that the trial court reversibly erred by
rendering the default final judgment. To the extent Kennard argues that the trial
court erred solely by rendering a post-answer default judgment, we disagree. The
supreme court has recognized that a failure to appear for trial may result in a
post-answer default judgment. See Dolgencorp of Tex., Inc. v. Lerma, 288 S.W.3d
922, 925 (Tex. 2009). Therefore, the fact that Kennard filed an answer, without
more, does not prevent the trial court from properly rendering a default final
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judgment. However, Kennard also argues that the final judgment was improper
because Lamar did not prove its case.
1. Kennard’s failure to file a motion for new trial
Lamar argues in response that Kennard did not preserve its challenge to the
post-answer default judgment for appeal because Kennard did not file a motion for
new trial.1 The supreme court articulated the standard for setting aside a default
judgment in Craddock v. Sunshine Bus Lines, Inc., 133 S.W.2d 124, 126 (Tex.
[Comm’n Op.] 1939). This test governs post-answer default judgments as well as
no-answer default judgments. Dolgencorp, 288 S.W.3d at 925–26; Ivy v. Carrell,
407 S.W.2d 212, 213 (Tex. 1966) (extending Craddock to post-answer default
judgments). Under the Craddock test, a default judgment should be vacated and a
new trial granted when the defaulting party establishes: (1) the failure to appear
was not intentional or the result of conscious indifference, but was the result of an
accident or mistake; (2) the motion for new trial sets up a meritorious defense; and
(3) granting the motion will occasion no delay or otherwise injure the party who
obtained the default judgment. Craddock, 133 S.W.2d at 126; see also Dolgencorp,
288 S.W.3d at 925.
When extrinsic evidence is necessary to challenge a default judgment, a
motion for new trial filed in the trial court is a prerequisite to complaining on
appeal that it should be set aside. Tex. R. Civ. P. 324(b)(1); see Ginn v. Forrester,
282 S.W.3d 430, 432 (Tex. 2009) (“When extrinsic evidence is necessary to
challenge a judgment, the appropriate remedy is by motion for new trial or by bill
of review filed in the trial court so that the trial court has the opportunity to
1
Kennard filed a notice of appeal on October 15, 2019, less than 30 days after the
September 17, 2019 default judgment. Thus, Kennard knew about the default judgment within
the 30-day period in which it could have filed a motion for new trial. See Tex. R. Civ. P. 329b(a).
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consider and weigh factual evidence.”); Puri v. Mansukhani, 973 S.W.2d 701, 715
(Tex. App.—Houston [14th Dist.] 1998, no pet.) (citing Rule 324 for proposition
that motion to set aside default judgment is complaint on which evidence must be
heard). The record does not contain any information supporting any of the
Craddock factors. Kennard did not file a motion for new trial, nor did he attempt to
put any evidence in the record through another means.2 Therefore, by not filing a
motion for new trial, Kennard did not introduce any extrinsic evidence to the
record to support any of the Craddock factors. We agree with Lamar that Kennard
has waived its opportunity to set aside the default judgment by not filing a motion
for new trial. See Tex. R. Civ. P. 324(b)(1); Tex. R. App. P. 33.1(a)(1)(B).
We overrule Kennard’s issue two in part.
2. Legal sufficiency of the evidence
However, Kennard also argues in issue two that Lamar failed to prove its
case. We read this argument as challenging the final judgment as not supported by
legally-sufficient evidence, a complaint which may be made for the first time on
appeal. Tex. R. App. P. 33.1(d). We review the legal sufficiency of the evidence
supporting a post-answer default judgment under the same standard of review
governing the legal sufficiency of the evidence at a contested trial. Texas G & S
Invs., Inc. v. Constellation Newenergy, Inc., 459 S.W.3d 252, 257 (Tex. App.—
Houston [14th Dist.] 2015, no pet.). We consider the evidence in the light most
favorable to the challenged judgment and indulge every reasonable inference that
would support it. City of Keller v. Wilson, 168 S.W.3d 802, 827 (Tex. 2005).
A post-answer default judgment occurs when a defendant who has answered
2
Kennard states in its reply brief that an unintentional calendaring mistake led to the non-
attendance at trial. However, Kennard’s statement in its reply brief is not evidence, nor can
Kennard raise a new issue in its reply brief, not raised in its original brief. See Tex. R. App. 38.3.
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fails to appear for trial. Dolgencorp, 288 S.W.3d at 925. The failure to appear is
considered neither an abandonment of the defendant’s answer nor an implied
confession of any issues. See Stoner v. Thompson, 578 S.W.2d 679, 682 (Tex.
1979). A post-answer default judgment cannot be rendered on the pleadings alone.3
See Paradigm Oil, Inc. v. Retamco Operating, Inc., 372 S.W.3d 177, 183 (Tex.
2012). The plaintiff must still offer evidence and prove its case. Id.There is no reporter’s record of the trial. In its appellate briefing, Lamar
states that it believes the court reporter transcribed the trial proceeding. However,
the court reporter filed a signed statement with this court stating there is no
reporter’s record. The court’s docket sheet reflects that witness testimony was
taken and a single exhibit admitted; however, the docket sheet is not evidence of
Lamar’s claim and does not provide anything for this court to review with regard
to the sufficiency of the evidence. See Rios v. Texas Bank, 948 S.W.2d 30, 31–32
(Tex. App.—Houston [14th Dist.] 1997, no writ) (ordinarily docket entry is not
part of record that may be considered by appellate court, though docket entry may
be considered in certain situations, such as when necessary to correct clerical errors
in judgments or orders); In re Bill Heard Chevrolet, Ltd., 209 S.W.3d 311, 315
(Tex. App.—Houston [1st Dist.] 2006, no pet.). Lamar references the availability
of the trial exhibit, either in part or in full, on the Fort Bend County District
Clerk’s website. However, this court may not consider documents that are not part
of the record, and the exhibit referenced by Lamar is not part of the record in this
3
No-answer and post-answer default judgments differ in the issues a plaintiff is required
to prove. Dolgencorp, 288 S.W.3d at 930. In cases of no-answer default, a defaulting defendant
admits all facts properly pleaded in the plaintiff’s petition except for the amount of unliquidated
damages. Holt Atherton Indus., Inc. v. Heine, 835 S.W.2d 80, 83 (Tex. 1992). Thus, the plaintiff
is only required to prove its claim for unliquidated damages. Id.; see Tex. R. Civ. P. 243. But if
the defendant files an answer, as in this case, a trial court may not render judgment on the
pleadings, and the plaintiff is required to offer evidence and prove all aspects of its claim. See
Paradigm Oil, Inc. v. Retamco Operating, Inc., 372 S.W.3d 177, 183 (Tex. 2012)
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appeal. See Tex. R. App. P. 34.1 (“The appellate record consists of the clerk’s
record and, if necessary to the appeal, the reporter’s record.”); Canton–Carter v.
Baylor Coll. of Med., 271 S.W.3d 928, 931 n.2 (Tex. App.—Houston [14th Dist.]
2008, no pet.).
Because Lamar filed a suit on a sworn account, we are able to consider
Lamar’s petition and corresponding affidavit as prima facie evidence of its claim.
Texas Rule of Civil Procedure 185 describes the evidence necessary to establish a
prima facie right of recovery or defense for a suit on a sworn account. 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.); Smith v. CDI Rental Equip., Ltd., 310 S.W.3d
559, 566 (Tex. App.—Tyler 2010, no pet.) (“a suit on a sworn account is not an
independent cause of action; it is a procedural rule with regard to evidence
necessary to establish a prima facie right of recovery of certain types of contractual
(account) claims”). Prima facie evidence “refers to evidence sufficient as a matter
of law to establish a given fact if it is not rebutted or contradicted.” In re Lipsky,
460 S.W.3d 579, 590 (Tex. 2015) (citing Simonds v. Stanolind Oil & Gas Co., 136
S.W.2d 207, 209 (Tex. [Comm’n Op.] 1940)). If a plaintiff complies with Rule
185’s requirements, the plaintiff is entitled to judgment as a matter of law unless
the defendant files a verified denial. Tandan, 377 S.W.3d at 894; see Powers v.
Adams, 2 S.W.3d 496, 498 (Tex. App.—Houston [14th Dist.] 1999, no pet.).
Lamar’s petition and affidavit met the requirements of Rule 185. The affidavit
attached to Lamar’s petition also included and proved up the contract between
Lamar and Kennard for the billboard advertisements, as well as a statement of
Kennard’s account. See Tex. R. Evid. 902(10). These records were supported by an
affidavit that established Lamar’s claim was “within the knowledge of affiant, just
and true, that it is due, and that all just and lawful offsets, payment and credits have
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been allowed[.]” Tex. R. Civ. P. 185. In the event of a breach, the contract
provided for an interest rate of 1.5% per month, corresponding to the annualized
interest rate in the judgment. Kennard did not file a verified denial, which
conclusively established there was no defense to the suit on the sworn account. See
Tandan, 377 S.W.3d at 894. Therefore, Lamar did prove its
suit-on-a-sworn-account claim as a matter of law. Cf. Sharif v. Par Tech, Inc., 135
S.W.3d 869, 873 (Tex. App.—Houston [1st Dist.] 2004, no pet.) (post-answer
default judgment cannot be supported by suit on sworn account pleadings when
defendant’s sworn denial destroyed evidentiary effect of plaintiff’s verified sworn
account pleadings).
The judgment also contains an award of attorney’s fees in the amount of
$6,000. Though the contract between the parties did allow for “reasonable
attorney’s fees” in the event of a breach, Lamar was required to prove the
reasonableness of the requested attorney’s fees. See Rohrmoos Venture v. UTSW
DVA Healthcare, LLP, 578 S.W.3d 469, 501–02 (Tex. 2019) (“a claimant seeking
an award of attorney’s fees must prove the attorney’s reasonable hours worked and
reasonable rate by presenting sufficient evidence to support the fee award sought”).
There is neither any record of attorney testimony on fees, nor does the record
contain any billing records.
If the plaintiff offers evidence in the absence of the defendant or his
attorney, the failure to have the court reporter present to transcribe the proceedings
and file exhibits constitutes reversible error. Bechem v. Reliant Energy Retail
Services, LLC, 441 S.W.3d 839, 846 (Tex. App.—Houston [14th Dist.] 2014, no
pet.); see Rogers v. Rogers, 561 S.W.2d 172, 173–74 (Tex. 1978) (holding that if
appellant “through no fault of his own is unable to obtain a proper record of the
evidence introduced, this may require a new trial where his right to have the case
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reviewed can be preserved in no other way”); cf. Tex. R. Civ. P. 37.3(c) (when no
reporter’s record filed due to appellant’s fault); Mays v. Pierce, 281 S.W.2d 79, 82
(Tex. 1955) (general rule is when record does not include statement of facts we
presume there was evidence to support trial court’s judgment). This error is not
harmless because, without a reporter’s record, the reviewing court is unable to
determine if sufficient evidence was submitted to support the judgment. See
Bechem, 441 S.W.3d at 846; see also Carstar Collision, Inc. v. Mercury Fin. Co.,
23 S.W.3d 368, 370 (Tex. App.—Houston [1st Dist.] 1999, pet. denied). We
conclude there is no evidence in the record supporting the award of attorney’s fees
to Lamar. See Rohrmoos Venture, 578 S.W.3d at 502 (“Sufficient evidence
includes, at a minimum, 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[.]”). In a
post-answer default setting, a legal insufficiency point will only support a new
trial, and not a rendition of judgment. See Dolgencorp, 288 S.W.3d at 929–30 (“In
the absence of opposing counsel, an uncontested trial, like an uncontested damages
hearing, is less likely to result in a fully-developed factual record.”); see also U.S.
Fire Ins. Co. v. Carter, 473 S.W.2d 2, 3 (Tex. 1971) (noting appellate court may
remand when case has not been fully developed); Bechem, 441 S.W.3d at 846. We
sustain issue two in part.
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III. CONCLUSION
The trial court’s judgment is reversed in part as to the award of attorney’s
fees to Lamar. We otherwise affirm the trial court’s judgment as challenged on
appeal. The case is remanded to the trial court for further proceedings limited to
Lamar’s attorney’s fees claim.
/s/ Charles A. Spain
Justice
Panel consists of Justices Bourliot, Zimmerer, and Spain.
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