East Hill Marine, Inc. v. Rinker Boat Co.

• Decision Date: 21 June 2007
• Docket Number: No. 2-06-210-CV.,2-06-210-CV.
• Citation: 229 S.W.3d 813
• Parties: EAST HILL MARINE, INC. and Joe Stark d/b/a Joe Stark Marine, Appellants, v. RINKER BOAT CO., INC. and Gaven Hunt, Appellees.
• Court: Texas Court of Appeals

229 S.W.3d 813

EAST HILL MARINE, INC. and Joe Stark d/b/a Joe Stark Marine, Appellants, v. RINKER BOAT CO., INC. and Gaven Hunt, Appellees.

No. 2-06-210-CV.

Court of Appeals of Texas, Fort Worth.

June 21, 2007.

Jeffrey L. Clark, Kelsoe, Anderson, Khoury & Clark, P.C., Dallas, Joseph W. Spence, Shannon, Gracey, Ratliff & Miller, L.L.P., Fort Worth, for Appellants.

J. Benjamin Barlow, Chris D. Collins, David D. Rapp, Barlow Garsek & Simon, LLP, Fort Worth, for Appellees.

PANEL A: CAYCE, C.J.; LIVINGSTON and GARDNER, JJ.

OPINION

TERRIE LIVINGSTON, Justice.

I. Introduction

Appellants East Hill Marine, Inc. and Joe Stark d/b/a Joe Stark Marine appeal the trial court's order granting summary judgment to appellees Rinker Boat Co., Inc. and Gaven Hunt. In their first two issues, appellants argue that the trial court erred by granting a traditional summary judgment against them on their breach of contract claims and by granting a traditional summary judgment and no-evidence summary judgment against them on their Texas Occupations Code claims. In a third issue, East Hill Marine, solely, argues that the trial court erred by granting a traditional summary judgment against it on its Deceptive Trade Practices Act ("DTPA") claim. We affirm.

II. Background Facts

In the early 1990s Stark became an authorized Rinker Boats dealer in Fort Worth, Texas. Stark and appellees did not enter into a written agreement documenting the terms of the dealer agreement, but instead, orally agreed that Stark could be the authorized dealer in Fort Worth for as long as he wanted to with no minimum purchase requirements. Stark continued to be a Rinker dealer in Fort Worth until 2004. During this time, appellees listed Stark's business on its website as an authorized dealer and corresponded with Stark as a dealer. Stark paid no money to appellees in exchange for this agreement.

On September 23, 2004, appellees sent a letter to Stark informing him that they were terminating their dealership agreement with him because of lack or loss of sales performance and sub par performance in the areas of customer service and satisfaction. The letter informed Stark that the agreement would terminate in 90 days and appellees would honor any reasonable orders within the 90-day period.

East Hill Marine entered into a verbal dealer agreement with appellees in March 2004. East Hill Marine claims that appellees made the same oral representations to it that they had made to Stark; specifically, that East Hill Marine would be the exclusive Rinker dealer in North Dallas for as long as East Hill Marine wanted to be. East Hill Marine also claims that, under the agreement, East Hill Marine did not have to purchase a minimum number of boats to remain a Rinker dealer. Larry Cochran, the president of East Hill Marine, requested a written agreement, but appellees informed him that they did not have a written agreement, nor would they provide him with one. Regardless, East Hill Marine became a Rinker dealer and purchased boats from appellees for approximately seven months. Like Stark, East Hill Marine paid no money to appellees to become an authorized dealer. On November 1, 2004, appellees called East Hill Marine and stated that they were terminating East Hill Marine's dealership status. On December 13, 2004, appellants sued appellees for breach of their dealer agreements and for violating the Texas Occupations Code as it relates to boat dealers and manufacturers. East Hill Marine, solely, also asserted a claim against appellees under the DTPA. In November 2005, appellees filed a traditional motion for summary judgment on all three claims and an additional no-evidence motion for summary judgment on the Occupations Code claims, all of which the trial court granted. This appeal followed.

III. Standards of Review

A. Traditional Summary Judgment

A defendant who conclusively negates at least one essential element of a cause of action is entitled to summary judgment on that claim. IHS Cedars Treatment Ctr. of DeSoto, Tex., Inc. v. Mason, 143 S.W.3d 794, 798 (Tex.2004); see TEX.R. CIV. P. 166a(b), (c). When reviewing a summary judgment, we take as true all evidence favorable to the nonmovant, and we indulge every reasonable inference and resolve any doubts in the nonmovant's favor. IHS Cedars Treatment Ctr., 143 S.W.3d at 798.

A defendant is entitled to summary judgment on an affirmative defense if the defendant conclusively proves all the elements of the affirmative defense. Rhone-Poulenc, Inc. v. Steel, 997 S.W.2d 217, 223 (Tex.1999); see TEX.R. CIV. P. 166a(b), (c). To accomplish this, the defendant-movant must present summary judgment evidence that establishes each element of the affirmative defense as a matter of law. Ryland Group, Inc. v. Hood, 924 S.W.2d 120, 121 (Tex.1996). When reviewing a summary judgment, we take as true all evidence favorable to the nonmovant, and we indulge every reasonable inference and resolve any doubts in the nonmovant's favor. IHS Cedars Treatment Ctr., 143 S.W.3d at 798.

B. No-Evidence Summary Judgment

After an adequate time for discovery, the party without the burden of proof may, without presenting evidence, move for summary judgment on the ground that there is no evidence to support an essential element of the nonmovant's claim or defense. TEX.R. CIV. P. 166a(i). The motion must specifically state the elements for which there is no evidence. Id.; Johnson v. Brewer & Pritchard, P.C., 73 S.W.3d 193, 207 (Tex.2002). The trial court must grant the motion unless the nonmovant produces summary judgment evidence that raises a genuine issue of material fact. See TEX.R. CIV. P. 166a(i) & cmt.; Sw. Elec. Power Co. v. Grant, 73 S.W.3d 211, 215 (Tex.2002).

When reviewing a no-evidence summary judgment, we examine the entire record in the light most favorable to the nonmovant, indulging every reasonable inference and resolving any doubts against the motion. Sudan v. Sudan, 199 S.W.3d 291, 292 (Tex. 2006). If the nonmovant brings forward more than a scintilla of probative evidence that raises a genuine issue of material fact, then a no-evidence summary judgment is not proper. Moore v. K Mart Corp., 981 S.W.2d 266, 269 (Tex.App.-San Antonio 1998, pet. denied).

When a party moves for summary judgment under both rules 166a(c) and 166a(i), we will first review the trial court's judgment under the standards of rule 166a(i). Ford Motor Co. v. Ridgway, 135 S.W.3d 598, 600 (Tex.2004). If the nonmovant failed to produce more than a scintilla of evidence under that burden, then there is no need to analyze whether the movant's summary judgment proof satisfied the less stringent rule 166a(c) burden. Id.

IV. Texas Occupations Code

In their first issue, appellants argue that the trial court erred by granting traditional and no-evidence summary judgments against them on their Occupations Code claims.¹ Appellees' no-evidence motion was based on the argument that the Occupations Code requires a written agreement between a manufacturer and a dealer, and in this case, there was no evidence of a written agreement between the parties. Appellees' traditional summary judgment motion was based on the argument that appellants were estopped and quasi-estopped from bringing their claims because they violated the Occupations Code by not entering into a written contract.

A. Applicable Law

The Occupations Code states that a boat manufacturer may not terminate an agreement with a dealer unless there is good cause for the termination. TEX. OCC.CODE ANN. § 2352.053(a) (Vernon 2004). Section 2352.051 further requires that a boat manufacturer and a dealer enter into an agreement that complies with section 2352.052. See id. § 2352.051. Under section 2352.052, the agreement must contain the following terms:

(1) the dealer's location, territory, or market area;

(2) the length of the agreement;

(3) any performance or marketing standards;

(4) any working capital, inventory, facility, equipment, or tool standards;

(5) provisions for termination or nonrenewal of the agreement and the designation of a successor dealer in the event of the dealer's death or disability;

(6) the obligations of the manufacturer, distributor, and dealer in the preparation and delivery of and warranty service on new boats and new outboard motors;

(7) the obligations of the manufacturer, distributor, and dealer on termination of the agreement, including inventory of new boats and new outboard motors, parts inventory, equipment, furnishings, special tools, and required signs; and

(8) dispute resolution procedures.

Id. § 2352.052(a). Section 2352.001 of the Occupations Code defines "agreement" as a "written agreement between a manufacturer . . . and a dealer for the purchase and sale of new boats or new outboard motors." Id. § 2352.001(1) (emphasis added).

B. Analysis

Under section 2352.051, a dealer and a manufacturer have a mutual obligation to enter into a written agreement before selling or buying boats. See id. §§ 2352.001, .051. Appellants argue that section 2352.053 "provides that a manufacturer such as Rinker may not terminate dealers such as [appellants] unless there exists good cause." [Emphasis added.] However, the statute actually states that a manufacturer "may not terminate an agreement unless there is good cause." Id. § 2352.053(a) (emphasis added). While appellants may be correct that the Occupations Code was designed to protect small boat dealers from large and powerful manufacturers, the clear language of the statute requires both parties to enter into a written agreement. See id. § 2352.051. Therefore, any verbal agreements between appellants and appellees are not subject to section 2352.053's prohibition on termination without good cause. See id. §§ 2352.001, .053.

Appellants next claim that various pieces of correspondence, purchase orders, purchase invoices, and other documents were sufficient to constitute written agreements between them and appellees. However, appellants...