Sameera Arshad & Almorfa, LLC v. Am. Express Bank, FSB

• Decision Date: 25 July 2019
• Docket Number: NO. 14-17-00676-CV,14-17-00676-CV
• Citation: 580 S.W.3d 798
• Parties: Sameera ARSHAD and Almorfa, LLC, Appellants v. AMERICAN EXPRESS BANK, FSB, Appellee
• Court: Texas Court of Appeals

580 S.W.3d 798

Sameera ARSHAD and Almorfa, LLC, Appellants

v.AMERICAN EXPRESS BANK, FSB, Appellee

NO. 14-17-00676-CV

Court of Appeals of Texas, Houston (14th Dist.).

Opinion filed July 25, 2019

James B. Heston, Ranald Scott Calili, Daniel Joseph Ciment, Katy, TX, for Appellants.

Dawn Deshea Rogers, Sugarland, TX, for Appellee.

Panel consists of Chief Justice Frost and Justices Spain and Poissant.

Kem Thompson Frost, Chief Justice

Appellants Sameera Arshad and Almorfa, LLC (the "Arshad Parties") appeal the final judgment in favor of appellee American Express Bank, FSB on its breach-of-contract claim based on the Arshad Parties' failure to pay their credit card debt. We affirm.

I. BACKGROUND

The Arshad Parties obtained a "Business Gold Rewards" credit card from American Express in 2012. Several years later, American Express sued them for breach of contract, alleging they had defaulted on the credit card by failing to pay under the Cardmember Agreement. American Express alleged they owed $316,007.19. The Arshad Parties filed a general denial and also pleaded the affirmative defense of statute of limitations.

Business Records Affidavit

American Express filed a notice of business records affidavit of Mario D. Morales-Arias, an assistant custodian of records for American Express. The records included the Cardmember Agreement and account statements showing charges made to the card and payments made on the account balance by the Arshad Parties. Before the start of the bench trial, American Express informed the trial court in open court that Morales-Arias would testify as to the authenticity of its records, which American Express would seek to introduce into evidence at trial, and "show the Court that they are kept within and pursuant to the regular course of business." American Express advised the trial court that it had provided the documents to the Arshad Parties in a business-records affidavit by Morales-Arias, which American Express had filed with the court, and that American Express also had produced the documents to the Arshad Parties through discovery.

Admission of Business Records into Evidence

The Arshad Parties objected to the use of the records and the testimony of Morales-Arias. They asserted that they did not receive the business-records affidavit and that the affidavit was not filed with the court. The trial court, however, confirmed that the business records affidavit had been filed with the court, and the Arshad Parties acknowledged that they had received the records through discovery. The Arshad Parties further objected to Morales-Arias testifying because American Express did not designate Morales-Arias as a witness; they sought the automatic exclusion of his testimony under Texas Rule of Civil Procedure 193.6.¹ American Express responded that it had provided Morales-Arias's name to the Arshad Parties in response to their requests for disclosures. American Express further stated that it was designating Morales-Arias as its corporate representative at trial so it was not necessary to disclose him as a person with knowledge of relevant facts.

The trial court ruled that it would (1) allow American Express to call one witness; (2) not allow the business-records affidavit with the documents into evidence; (3) allow American Express to ask questions only about the documents produced during discovery; and (4) allow the Arshad Parties to cross-examine the witness, at which time the trial court would determine whether the documents would be admitted into evidence. Morales-Arias was the only witness to testify at trial. The trial court admitted the records that were produced in discovery into evidence.

Final Judgment

The trial court rendered a final judgment for American Express in the amount of $316,007.19. At the Arshad Parties' request, the trial court issued findings of fact and conclusions of law. The Arshad Parties timely filed this appeal from the final judgment.

II. ISSUES ON APPEAL

In two issues, the Arshad Parties (1) claim that the trial court erred in overruling the Arshad Parties' objection to the testimony of Morales-Arias; and (2) challenge the legal and factual sufficiency of the evidence to support the judgment on American Express's breach-of-contract claim.

III. ANALYSIS

We do not address the Arshad Parties' issues in the order in which they were briefed. Issues, if sustained, that require the judgment to be reversed and rendered should be addressed first. See Tex. R. App. P. 43.3 (providing that when reversing a judgment, the appellate court must render judgment unless a remand is required); In re S.R. , 452 S.W.3d 351, 359 (Tex. App.—Houston [14th Dist.] 2014, pet. denied) ("If disposition of an issue would result in a rendition of judgment, an appellate court should consider that issue before addressing any issues that would result only in a remand for a new trial."). Therefore, because the second issue includes a challenge to the legal sufficiency of the evidence to support the judgment, we address it first. See Horrocks v. Tex. Dep't of Transp. , 852 S.W.2d 498, 499 (Tex. 1993) (per curiam) ("Ordinarily, an appellate court should render judgment after sustaining a complaint as to the legal sufficiency of the evidence.").

A. Is the evidence legally and factually sufficient to support the judgment?

In their second issue, the Arshad Parties challenge the legal and factual sufficiency of the evidence to support American Express's breach-of-contract claim.

In an appeal from a bench trial, the trial court's findings of fact have the same force and dignity as a jury verdict. Anderson v. City of Seven Points , 806 S.W.2d 791, 794 (Tex. 1991). We review the trial court's findings using the same standards of review applicable to a jury's verdict. See MBM Fin. Corp. v. Woodlands Operating Co. , 292 S.W.3d 660, 663 n.3 (Tex. 2009).

When reviewing the legal sufficiency of the evidence, we consider the evidence in the light most favorable to the challenged finding and indulge every reasonable inference that would support it. City of Keller v. Wilson , 168 S.W.3d 802, 823 (Tex. 2005). We credit favorable evidence if a reasonable factfinder could and disregard contrary evidence unless a reasonable factfinder could not. See id. at 827. Our task is to determine whether the evidence at trial would enable reasonable and fair-minded people to find the facts at issue. See id. As long as the evidence at trial "would enable reasonable and fair-minded people to differ in their conclusions," we will not substitute our judgment for that of the factfinder. See id. The factfinder is the only judge of witness credibility and the weight to give to testimony. See id.

When reviewing a challenge to the factual sufficiency of the evidence, we examine the entire record, considering both the evidence in favor of, and contrary to, the challenged finding. Maritime Overseas Corp. v. Ellis , 971 S.W.2d 402, 406–07 (Tex. 1998). When a party challenges the factual sufficiency of the evidence supporting a finding for which it did not have the burden of proof, we set aside the verdict only if it is so contrary to the overwhelming weight of the evidence as to be clearly wrong and unjust. See id. at 407. We may not substitute our own judgment for that of the trier of fact, even if we would reach a different answer on the evidence. Maritime Overseas Corp. , 971 S.W.2d at 407. The amount of evidence necessary to affirm a judgment is far less than that necessary to reverse a judgment. GTE Mobilnet of S. Tex. Ltd. P'ship v. Pascouet , 61 S.W.3d 599, 616 (Tex. App.—Houston [14th Dist.] 2001, pet. denied).

An appellant may not challenge a trial court's conclusions of law for factual sufficiency, but we may review the legal conclusions drawn from the facts to determine their correctness. BMC Software Belg., N.V. v. Marchand , 83 S.W.3d 789, 794 (Tex. 2002). "If the reviewing court determines a conclusion of law is erroneous, but the trial court rendered the proper judgment, the erroneous conclusion of law does not require reversal." Id.

1. The evidence is sufficient to establish a binding contract.

To establish a claim for breach of contract, a plaintiff must prove the following elements: (1) a valid contract; (2) performance or tendered performance by the plaintiff; (3) breach of the contract by the defendant; and (4) damages sustained by the plaintiff as a result of the breach. Smith v. Smith , 541 S.W.3d 251, 259 (Tex. App.—Houston [14th Dist.] 2017, no pet.). The Arshad Parties challenge the existence of a valid contract. To prove the existence of a valid contract, a plaintiff must establish that (1) an offer was made; (2) the other party accepted in strict compliance with the offer's terms; (3) the parties had a meeting of the minds on the contract's essential terms; (4) each party consented to the those terms; and (5) the parties executed and delivered the contract with the intent that it be mutual and binding. USAA Tex. Lloyds Co. v. Menchaca , 545 S.W.3d 479, 501 n.21 (Tex. 2018).

The Arshad Parties assert that there is no contract because there are no signatures. Contracts require mutual assent to be enforceable. Baylor Univ. v. Sonnichsen , 221 S.W.3d 632, 635 (Tex. 2007) (per curiam). Evidence of mutual assent in written contracts generally consists of signatures of the parties and delivery with the intent to bind. Id. Although signatures and delivery evince the mutual assent required for a contract, they are not essential. Phillips v. Carlton Energy Grp., LLC , 475 S.W.3d 265, 277 (Tex. 2015). "[A] contract need not be signed to be ‘executed’ unless the parties explicitly require signatures as a condition of mutual assent. If a written draft of an agreement is prepared, submitted to both parties, and each of them expresses his unconditional assent thereto, there is a written contract." Id. (internal quotations and citations omitted).

The Cardmember Agreement states in relevant part:

When you or an Additional Cardmember, as defined below, use

...