McMahan v. Izen

• Decision Date: 02 September 2021
• Docket Number: 01-20-00233-CV
• Court: Texas Court of Appeals
• Parties: TIMOTHY JAMES MCMAHAN AND KAREN MCMAHAN, Appellants v. JOE ALFRED IZEN, JR., Appellee

TIMOTHY JAMES MCMAHAN AND KAREN MCMAHAN, Appellants v. JOE ALFRED IZEN, JR., Appellee

No. 01-20-00233-CV

Court of Appeals of Texas, First District

September 2, 2021

On Appeal from County Civil Court at Law No. 1 Harris County Texas Trial Court Case No. 1115867

Panel consists of Justices Goodman, Hightower, and Rivas-Molloy.

MEMORANDUM OPINION

Richard Hightower, Justice

Pro se appellants Timothy James McMahan and Karen McMahan, who are husband and wife, appeal a summary judgment rendered against them in favor of Joe Alfred Izen, Jr., awarding Izen damages and attorney's fees. The McMahans raise six issues on appeal. In their first four issues, they contend that the trial court erred in granting summary judgment in favor of Izen. In their fifth issue, the McMahans assert that they were denied due process during the hearing on the summary judgment. In their sixth issue, the McMahans contend that the evidence does not support the trial court's award of attorney's fees.

We affirm.

Background

It is not in dispute that Izen, an attorney, represented the McMahans relating to litigation between them and the Internal Revenue Service (IRS). Nor is it in dispute that the McMahans made payments to Izen, totaling $7, 997, for his legal services. The dispute centers on whether the McMahans still owe Izen an additional $26, 864.60 in legal fees.

On August 21, 2018, Izen filed a suit on a sworn account against the McMahans, seeking to recover $26, 864.60 in legal fees which he claimed the McMahans still owed him for representing them in the IRS litigation. Izen sued Timothy, individually and in Timothy's capacity as trustee for the Texas Land Patent Company and as trustee for the TJM Trust No. 1. Izen sued Karen only in her individual capacity. Izen alleged that he had represented the McMahans from June 2012 until September 2014 in two suits with the IRS. Although he did not have a written contract with the McMahans, Izen asserted that the McMahans had agreed to pay him $300 per hour for his legal services on an open account. Izen acknowledged that the McMahans had made payments to him, totaling $7, 997, but he asserted that they still owed him $26, 864.60 for legal services he had provided to them on the open account. Izen also sought attorney's fees and costs for prosecuting the suit to collect his unpaid fees.

Izen supported his first amended petition with his unsworn declaration, prepared pursuant to section 132.001 of the Civil Practices and Remedies Code. See TEX. CIV PRAC. &REM. CODE § 132.001(a) (providing that "an unsworn declaration may be used in lieu of a written sworn declaration, verification, certification, oath, or affidavit required by statute or required by a rule, order, or requirement adopted as provided by law"). Attached to Izen's declaration as "Exhibit A" were two billing records, which itemized the legal services that he had performed for the McMahans in the IRS litigation. The records included a description of the services he had performed, the amount of time he had spent on each described task, the date of the service, and the corresponding legal fee for each task. Expenses and costs incurred by Izen in representing the McMahans were also listed. The billing records (1) reflected the total amount of the Izen's fees and expenses he incurred, (2) listed the payments already made by the McMahans to him, (3) subtracted these payments from the total amount of fees, and (4) showed the balance due. Attached to the declaration as "Exhibit B" was a demand letter sent by Izen to the McMahans requesting payment of the outstanding balance.

In his declaration, Izen stated that he was licensed to practice in Texas in 1977 and had practiced law in Harris County, Texas since then. He further attested:

3. I have read and reviewed all of the entries in the billing for my legal services performed for the McMahan defendants which is attached hereto and marked as Exhibit A. In my opinion a reasonable rate for hourly services of an attorney performing [the] same or similar legal work in the two legal matters and cases reflected by the attached billing, Exhibit A, and the two cases described in the Petition I have filed is $300.00 per hour.

4. I specifically reviewed all of the entries in the billing and all the legal work reflected in such billing was performed by me and was necessary to protect and advance the legal interests and rights of the McMahan Defendants who were my clients in the legal matters and cases described in the First Amended Petition and the legal billing, Exhibit A.

5. Furthermore, I have checked my own financial records and have confirmed that the McMahan Defendants were entitled to $7, 997.00 credit for payments they made for my legal services and/or reimbursements they owed to me for advancement of legal costs and legal expenses during the term of my representation. My financial records and billings reflect that the McMahan Defendants have been provided all just offsets and credits to which they are entitled and that they received credit for all payments they have made.

6. The McMahan Defendants owe the balance due as set out in the Exhibit A for legal services that I expended.

Izen averred that all the facts stated in the declaration were "true and correct within [his] own personal knowledge," and he certified that his statements were "true and correct under penalty of perjury."

The record reflects that Izen had difficulty serving the McMahans with the lawsuit. More than one year after filing suit, Izen obtained an order permitting him to serve the McMahans by substituted service.

On November 19, 2019, the McMahans filed their pro se answer to Izen's first amended petition. In addition to a general denial, the McMahans emphasized that they had no written contract with Izen, and they specifically denied that they had agreed that Izen would provide legal services to them on an open account. At the end of the answer, Timothy McMahan signed the following statement,

I affirm the foregoing answer in good faith to the best of my ability and comprehension of the statute, rules, and facts, and any errors of statute, rules, facts or law that I made by accident, I meant no harm and I will immediately correct all errors that are brought to my attention. I believe that all of the foregoing is true and complete to the best of my ability.

Timothy's signature was acknowledged by a notary public. Beneath Timothy's signature, Karen McMahan stated, "Timothy James McMahan is my husband, and that I am under his coverture, and that I have totally relied upon his actions in this matter." Karen signed the statement, and her signature was also acknowledged by a notary public. The McMahans' answer included special exceptions^[1] to Izen's first amended petition and a motion to dismiss the suit under Texas Rule of Civil Procedure 91a.

On December 23, 2019, Izen filed a no-evidence motion for summary judgment and, on December 26, 2019, Izen filed a traditional motion for summary judgment. Both motions sought summary judgment against Karen, individually, and against Timothy, individually, and as trustee for the Texas Land Patent Company and as trustee for the TJM Trust No. 1.

In the traditional motion for summary judgment, Izen asserted that he was entitled to summary judgment "on his cause of action based on sworn account." Pointing to the documents supporting his first amended petition-which included his section 132.001 declaration and the billing records itemizing the unpaid legal fees-Izen asserted that he had met the requirements of Rule of Civil Procedure 185 to prove the sworn account. He claimed that the McMahans owed him $26, 864.60 "after [the McMahans] have received and been accorded all offsets and credits to which [they] were entitled including the $7, 997.00 previously paid by [them]." He asserted, "Pursuant to Texas Rule of Civil Procedure Rule 185 governing filing of suits on sworn account and presentation of a cause of action and claims based on sworn account, [the McMahans] have not properly denied any portion of [Izen's] sworn account." Izen also asserted that he was entitled to summary judgment because the McMahans had breached the contract they had with him.

In addition to $26, 864.60 in damages for the unpaid legal fees, Izen asserted that, because his suit was based on a sworn account and was for legal services rendered to the McMahans, Civil Practice and Remedies Code section 38.001 entitled him to recover his reasonable and necessary attorney's fees of $47, 157.93 for prosecuting this suit. As evidence supporting his attorney's fees, Izen offered his declaration and billing records, itemizing the legal work he had performed in prosecuting this suit.

The motions for summary judgment were set for a hearing on January 14, 2019. The McMahans did not file a response to the motions, and the trial court granted Izen's no-evidence and traditional motions for summary judgment on that day.

On January 31, 2020, the McMahans filed a document entitled "Objection to Judgment on No-Evidence Summary Judgment." The McMahans complained that they had not received proper notice of the hearing on Izen's no-evidence motion for summary judgment. They asked the trial court to vacate the order granting the noevidence motion for summary judgment. In support of the objection, the McMahans each filed affidavits entitled "Declaration of Voluntary Pre-Trial Discovery by Affidavit." In the affidavits they addressed the merits of Izen's claims. They stated that they had not entered into an agreement with Izen for him to provide legal services to them on an open account. They stated that, instead, they had agreed to pay Izen a flat fee of $8, 000 to perform the legal services. They attached documents to their...