Bagby 3015, LLC v. Bagby House, LLC

• Decision Date: 18 May 2023
• Docket Number: 01-22-00463-CV
• Parties: BAGBY 3015, LLC AND AMIR ANSARI, Appellants v. BAGBY HOUSE, LLC, Appellee
• Court: Texas Court of Appeals

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BAGBY 3015, LLC AND AMIR ANSARI, Appellants v. BAGBY HOUSE, LLC, Appellee

No. 01-22-00463-CV

Court of Appeals of Texas, First District

May 18, 2023

On Appeal from the 164th District Court Harris County, Texas Trial Court Case No. 2022-13086

Panel consists of Chief Justice Adams and Justices Kelly and Goodman.

OPINION

Gordon Goodman Justice

In this accelerated interlocutory appeal, Bagby 3015, LLC and Amir Ansari contend that the trial court erred in denying their motion to dismiss some aspects of Bagby House, LLC's claims under the Texas Citizens Participation Act. We agree. Therefore, we reverse the trial court's denial of Bagby 3015 and Ansari's motion to dismiss Bagby House's claims for breach of contract and breach of the warranty or covenant of quiet enjoyment to the extent these claims are based on Bagby 3015 and Ansari's making of false reports to governmental authorities, and we render judgment dismissing these aspects of Bagby House's contract and quiet-enjoyment claims. We otherwise affirm the denial of the motion to dismiss and remand this cause to the trial court for further proceedings consistent with our opinion.

BACKGROUND

This appeal arises out of a commercial landlord-tenant dispute. The tenant, Bagby House, sued its landlord, Bagby 3015, and Bagby 3015's owner and managing member, Ansari. Bagby House alleges multiple causes of action, including claims for breach of contract (the lease), theft or conversion deceptive trade practices, breach of an express or implied warranty or covenant of quiet enjoyment, and fraud. Based on these causes of action, Bagby House alleges and seeks to recover damages, fees, and costs totaling more than $2,000,000.

Bagby House runs a restaurant on the leased premises. Among other things, it alleges Bagby 3015 and Ansari breached an implied warranty or covenant of quiet enjoyment and the corresponding provision, or another provision, of the lease by:

• burglarizing the restaurant, breaking into its safe and damaging or destroying the safe in the process, and stealing $6,000 from it;

• cutting holes in the restaurant's floors after business hours;

• ripping wires from breaker boxes while the restaurant was closed • removing umbrella dining tents that the restaurant had leased;

• ripping data and electric cables out from credit card processing equipment;

• sending people who feigned being repairmen needing to make nonexistent emergency repairs during the restaurant's peak business hours;

• locking Bagby House out of the premises despite timely payment of rent;

• calling the electric company to try and have it end service to the restaurant, notwithstanding that the service account is in the restaurant's name;

• making 911 calls falsely claiming the restaurant was on fire or collapsing;

• making a report to the city's fire marshal falsely claiming the restaurant was on fire or contained dangerous fire hazards;

• making reports to the city's health department falsely claiming the restaurant lacked a code-compliant grease trap or required permits; and

• summoning peace officers to the restaurant on the false pretense that Bagby House was trespassing on the premises or out of business.

Bagby 3015 and Ansari moved to dismiss Bagby House's contract and quiet-enjoyment claims under the Texas Citizens Participation Act. In particular, Bagby 3015 and Ansari argued that the claims of false reports or complaints to governmental authorities are based on or made in response to communications Bagby 3015 and Ansari made in the exercise of their right to petition and thus are subject to the Act. Given that Bagby House cannot make a prima facie case in support of these claims, Bagby 3015 and Ansari further argued, these claims had to be dismissed. In addition, they requested fees, costs, expenses, and sanctions.

In its response, Bagby House noted that though Bagby 3015 and Ansari sought dismissal of its claims for breach of the lease and the express or implied warranty or covenant of quiet enjoyment in their entirety, their supporting argument solely pertained to the claims concerning false reports to governmental authorities. Bagby 3015 and Ansari, Bagby House maintained, were silent as to the numerous other activities Bagby House alleged in support of these claims, such as the burglary and sabotage of the premises. On this basis, Bagby House argued that the trial court should deny Bagby 3015 and Ansari's motion to dismiss in its entirety.

Bagby House also submitted evidence in support of its claims for breach of the lease and the express or implied warranty or covenant of quiet enjoyment, arguing it had thereby made a prima facie case even as to the aspects of these claims that are subject to the Act. Accordingly, Bagby House posited that the trial court was required to deny Bagby 3015 and Ansari's motion to dismiss in any event.

Bagby House's evidence consisted of a declaration made by Donald R. Bowie, Bagby House's owner and managing member and several attachments. The attachments included a copy of the lease, e-mails about the renewal of the lease, two Houston Police Department forms that reflect the existence of incident reports made on two separate occasions, text messages between the restaurant's manager and chef discussing interactions with the city's fire marshal, and a report made by one of the city's building inspectors.

With respect to Bagby House's contract and quiet-enjoyment claims, Bowie declared that Bagby 3015 and Ansari occupied the restaurant one morning and "destroyed and burglarized Bagby House's safe, stealing $6,000 in cash." He declared that on another occasion "they again came into" the restaurant "during the morning and cut holes in the floors," "ripped electrical wires from live electrical boxes," "ripped out data and electric cables to the credit card processing machines," and "padlocked" the restaurant even though all rent due had been paid. Bowie further declared that Bagby 3015 and Ansari "contacted the electric utility company" and "attempted to convince the utility company to discontinue electrical service" to the restaurant, "even though the service was in Bagby House's name."

Bowie also made several representations about Bagby House's false-report claims in particular. These false-report representations consist of the following:

16. On March 26, Bagby 3015 and Ansari falsely called in a report to the Houston Police Department that the [restaurant] was on fire or collapsing when in fact the [restaurant] was neither on fire nor collapsing. Attached as Exhibit A-3 is a true and correct copy of the incident reports made by the Houston Police Department concerning this false report.

17. Also on March 26, they made a false report to the Fire Marshal of the City of Houston that the [restaurant] was a fire hazard. The Fire Marshal came to the [r]estaurant during business hours and inspected the [restaurant], but found no fire hazards and told Bagby House's employees that his visit had been a huge waste of his time. Attached as Exhibit A-4 is a true and correct copy of text messages between Bagby House employees recounting the Fire Marshal's inspection.

18. On March 26, they also falsely reported to the City of Houston Department of Building Code Enforcement that Bagby House was using a non-code compliant grease trap [i]n the [restaurant]. As reflected in the City of Houston building inspector's report attached as Exhibit A-5, when the building inspector visited the [restaurant] he did not find that the [restaurant's] grease trap did not comply with the City of Houston's Building Code, but instead found only minor deficiencies which were quickly and easily remedied by Bagby House.

19. On March 26, Bagby 3015 and Ansari, accompanied by their lawyer, came to the [restaurant] with a Harris County Precinct 1 deputy constable and attempted to convince him to remove Bagby House from the [restaurant] by falsely claiming that Bagby House was either out of business or trespassing. I personally heard these false claims being made to the deputy constable and other officers on[-]site. When the deputy constable determined that the [r]estaurant was neither out of business nor trespassing, nor did Bagby 3015 have any court order requiring the eviction of Bagby House from the [restaurant], the deputy constable and officers told Bagby [3015], Ansari, and their lawyer to leave the property and the deputy constable left the [restaurant] as well.

20. At no time prior to or during any of these events had Bagby 3015 served Bagby House with a notice of eviction, nor had Bagby 3015 filed any eviction proceeding against Bagby House or obtained a writ of possession for the [restaurant].

Finally, Bowie declared that all of Bagby 3015 and Ansari's acts "disrupted the business" of the restaurant, requiring Bagby House "to take the time and pay money to replace or make repairs to the property" and "to correct the false reports" made about Bagby House. Bowie declared that Bagby House had sustained "lost revenues and incurred repair and replacement costs totaling at least $212,950."

Bagby 3015 and Ansari replied, arguing that the Texas Citizens Participation Act does not impose an all-or-nothing approach and that the false-report aspects of the contract and quiet-enjoyment claims should be dismissed even if other aspects of these claims were not subject to dismissal under the Act. In addition, Bagby 3015 and Ansari argued that Bagby House had not made a prima facie case as to the false-report aspects of these claims. In particular, they maintained that Bowie's declaration was conclusory or speculative with respect to the false reports and did not show that they, as opposed to someone else, made any of the allegedly false communications about which...