Consol. Healthcare Servs., LLC v. Mainland Shopping Ctr., Ltd.
| Decision Date | 19 December 2019 |
| Docket Number | NO. 14-18-00189-CV,14-18-00189-CV |
| Parties | CONSOLIDATED HEALTHCARE SERVICES, LLC d/b/a A1 Imaging Centers, Appellant v. MAINLAND SHOPPING CENTER, LTD., Appellee |
| Court | Texas Court of Appeals |
Appellant Consolidated Healthcare Services, LLC, d/b/a A1 Imaging Centers (Consolidated), appeals the final summary judgment granted in favor of appellee, Mainland Shopping Centers, Ltd. (Mainland), on its breach of contract cause of action. In addition to arguing that the trial court did not err when it granted its motion for summary judgment, Mainland asserts that this court does not have jurisdiction over this appeal because Consolidated filed its notice of appeal too late. We conclude that we have jurisdiction to consider Consolidated's appeal. We also hold that the trial court did not err when it granted Mainland's motions for summary judgment. We therefore affirm the trial court's final judgment.
Consolidated's predecessor-in-interest leased a space in a shopping center managed by Mainland's predecessor-in-interest. Eventually, Consolidated fell behind in its rent payments. To resolve the delinquent rent issue, the parties entered into the "Agreement of Termination and Mutual Release of Lease" (Agreement).
In the Agreement, in exchange for the termination of the lease, Consolidated agreed to pay Mainland $37,375 divided into six equal payments, with a final balloon payment due on April 30, 2016. The parties also agreed that Consolidated had until that same day to sell and remove an MRI scanner located inside the leased space. The Agreement additionally provided that "the net proceeds of sale of the MRI Scanner in the Leased Premises (net of all costs of sale including but not limited to construction costs to remove the MRI Scanner and repair/rebuild the Leased Premises) shall be applied to offset the Settlement Payment." The Agreement also stated that if the MRI was not removed by the April 30 deadline, Mainland could "sell or discard the MRI Scanner as [Mainland deemed] fit." It further provided that Mainland was "entitled to reimbursement from [Consolidated] for any costs incurred in the removal of the MRI Scanner from the Leased Premises (including costs to repair/rebuild the Leased Premises)." Consolidated also agreed that it would indemnify Mainland "for any costs resulting from removal of the MRI Scanner." Finally, the Agreement gave Mainland "sole discretion to consent to or deny any proposed sale of the MRI Scanner," but Mainland could not unreasonably withhold that consent.
Consolidated made only the first two payments called for by the Agreement. In addition, Consolidated was unable to find a purchaser for the MRI by the April 30 deadline. Mainland filed suit alleging that Consolidated had breached the Agreement. Mainland alleged that it had incurred damages totaling at least $31,125 as a result of Consolidated's breach. Mainland also sought attorney's fees. During discovery, Mainland designated a construction expert and disclosed that the expert would testify that it would cost about $60,000 to remove the MRI from the leased space and then rebuild the exterior wall that would have to be demolished to accomplish the removal.1
Mainland eventually filed a traditional motion for summary judgment on its breach of contract cause of action. In the motion Mainland asserted it had established as a matter of law that Consolidated had breached the Agreement, and also that Mainland had suffered $91,097.67 as a result of the breach.2 Consolidated simultaneously filed an amended answer and a response to Mainland's motion for summary judgment. In the amended answer Consolidated added the affirmative defense of failure to mitigate damages and also alleged that it was entitled to an offset based on the value of the MRI in Mainland's possession. Consolidated argued in its summary judgment response that Mainland's evidence was insufficient to establish it breached the contract as a matter of law because Mainland's affidavits were self-serving and not easily controverted. Consolidated also included a reference to its newly-added affirmative defense of failure to mitigate damages. Consolidated did not, however, attach any evidence to its summary judgment response.
The trial court signed an interlocutory summary judgment order granting Mainland's motion on the question of liability and damages. It awarded Mainland the entire amount of damages that it sought, $91,097,67, as well as attorney's fees in the amount of $11,640. The trial court then stated
Mainland then filed a second motion for summary judgment asserting both traditional and no-evidence grounds on Consolidated's failure to mitigate affirmative defense and assertion that it was entitled to an offset or credit. Mainland argued that Consolidated was not entitled to an offset or credit against the unpaid $31,125 balance because Mainland had no duty under the Agreement to sell the MRI, or to even look for a buyer. In addition, Mainland pointed out that if Consolidated had not found a buyer by the April 30 deadline, Mainland had the authority under the Agreement to simply discard the MRI. Mainland then argued Consolidated had no evidence that Mainland (1) had not exercised reasonable care to minimize damages, or (2) did anything that caused further damages. Finally, Mainland argued Consolidated had no evidence of any amount of damages that could have been avoided through the exercise of reasonable care.
Consolidated filed a response to Mainland's motion in which it asserted entitlement to a $15,000 credit or offset because Mainland had denied Consolidated the opportunity to sell the MRI because Mainland "had not seen documents from the buyer of the machine prior to sale." Consolidated attached 24 pages of emails discussing the past-due payments called for by the Agreement, abandoned patient files inside the leased space, as well as the removal of the MRI from the leased space. Consolidated did not attach any affidavits to the response authenticating the emails. The emails were between several people including Ronald Hock, Consolidated's general counsel, Jeremy Roberts, counsel for Mainland, Linda Clayton, Mainland's property manager, Rick Miller with "makhealthcare," and Satheesh also with "makhealthcare." There is no evidence explaining who Rick Miller or Satheesh are, or how they are connected to the matters at issue in this appeal.
In addition, the only discussion regarding the sale of the MRI was Consolidated's belief, in early March 2016, that it had a "possible sale," with an undisclosed potential buyer, in the works where the gross proceeds could be $15,000. Hock mentioned this possible deal in an email to Roberts in which he also put forward renegotiating the Agreement to rework the payment schedule from a three-month time period to "a more reasonable repayment schedule" of 24 months. When Roberts responded that Mainland was interested but it needed to review the sale and construction proposal documents, Hock admitted that "none of those documents exist at present." Roberts then told Hock "that's fine." Roberts explained that Mainland needed "a chance to look at and approve everything before things actually get moving."
There were also emails from later in May and early June, 2016, regarding a meeting at the shopping center on June 6 to allow a contractor to examine the leased space so he could prepare a written quote for the removal of the MRI and subsequent rebuild of the exterior wall. Consolidated offered no other evidence regarding the possible sale of the MRI, the cost of removing the MRI from the leased space, or why the possible sale of the MRI did not proceed past these discussions regarding a meeting at the leased space.3
The trial court granted Mainland's second motion for summary judgment and signed an amended...
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