Medic Pharm. v. AVK Props.
| Decision Date | 30 June 2022 |
| Docket Number | 01-21-00447-CV |
| Parties | MEDIC PHARMACY, LLC AND DESIREE COLEMAN, Appellants v. AVK PROPERTIES, LLC, Appellee |
| Court | Texas Court of Appeals |
MEDIC PHARMACY, LLC AND DESIREE COLEMAN, Appellants
v.
AVK PROPERTIES, LLC, Appellee
No. 01-21-00447-CV
Court of Appeals of Texas, First District
June 30, 2022
On Appeal from the 412th District Court Brazoria County, Texas Trial Court Case No. 108453-CV
Panel consists of Chief Justice Radack and Justices Goodman and Hightower.
MEMORANDUM OPINION
Sherry Radack Chief Justice
Appellants, Medic Pharmacy, LLC ("Medic") and Desiree Coleman ("Coleman"), challenge the trial court's summary judgment in favor of appellee, AVK Properties, LLC ("AVK"), in AVK's suit against Medic for breach of a commercial lease and against Coleman for breach of a guaranty. In three issues,
Medic and Coleman contend that the trial court erred in granting summary judgment for AVK on an unpled conversion claim and that AVK failed to conclusively establish that it was entitled to judgment on its breach-of-contract claims.
We reverse and remand.
Background
On May 29, 2019, AVK, as landlord, and Medic, as tenant, entered into a commercial lease ("Lease"), under which AVK let to Medic 1,200 square feet of retail space ("Property") in a shopping center located in Pearland, Brazoria County, Texas. In conjunction with the Lease, AVK entered into a guaranty agreement ("Guaranty") with Medic's owner, Coleman.
The stated term of the Lease was for 39 months, beginning on June 1, 2019. Pursuant to the Lease, Medic agreed to pay "Base Monthly Rent" beginning on October 1, 2019 (after build out) of $2,564.00 and graduating over the term. Medic also agreed to pay "Additional Rent," i.e., its pro rata share of the projected monthly expenses for common area maintenance ("CAM"), taxes, and insurance, as provided in a "Commercial Lease Addendum" ("Addendum"), and to pay most utilities.
Pursuant to the Lease, payment of rent was due on the first day of each month. A failure to pay rent within five days after the due date constituted a default and subjected Medic to fees and penalties. In the event of a default, Article 20 of the
Lease authorized AVK to terminate Medic's occupancy, to accelerate all rents due for the remainder of the Lease, and to recover certain costs and damages, including:
(1) any lost rent
(2) [AVK's] cost of reletting the leased premises
(3) repairs to the leased premises for use beyond normal wear and tear;
. . .
(5) all [of AVK's] costs associated with collection of rent such as collection fees, late charges . . .; [and]
. . .
(9) any other recovery to which [AVK] may be entitled under this lease or under law.
The Lease further provided that:
Any alterations, improvements, fixtures or additions to the Property or leased premises installed by either party during the term of this lease will become [AVK's] property and must be surrendered to [AVK] at the time this lease ends, except for those fixtures [AVK] requires [Medic] to remove . . . or if the parties agree otherwise in writing.
AVK agreed to use commercially reasonable means to mitigate any losses.
In the attached Guaranty, Coleman, in consideration for AVK leasing the Property to Medic, guaranteed Medic's performance of the Lease, as follows:
If Tenant fails to timely make any payment under the lease, Guarantor[] will promptly make such payment to Landlord . . . . Guarantor is responsible for any property damage to the leased premises or Property (as defined in the lease) for which Tenant is responsible under the lease. If Tenant breaches the lease, Guarantor will: (i) cure the breach as may be required of Tenant by the lease; or (ii) compensate Landlord for Landlord's loss resulting from the breach.
It is undisputed that AVK tendered possession of the Property to Medic, that Medic occupied the Property, and that it vacated the Property during the Lease term.
AVK alleged that, beginning in February 2020, Medic breached the Lease by failing to pay as agreed. And, in May 2020, Medic breached the Lease by abandoning the Property, by removing a kitchen vent hood and fire suppression system belonging to AVK under the Lease, and by damaging 700 square feet of ceiling grid during the removal.
On May 28, 2020, AVK sent Medic and Coleman a Notice of Default, stating that Medic had "abandoned the leased premises on or about May 19, 2020 at night without any notice" and had removed fixtures and equipment, including a vent hood and fire suppression system belonging to AVK, and that Medic had damaged the ceiling during the removal. AVK demanded payment of unpaid rent, fees, and utilities, the return of the vent hood and fire suppression system, and reimbursement for ceiling repairs. AVK relet the Property and began collecting rent on July 25, 2020, and it sought it costs from Medic and Coleman.
After Medic and Coleman failed or refused to cure the default, AVK asserted a claim against Medic for breach of the Lease and against Coleman for breach of the Guaranty. Medic and Coleman each answered, generally denying the allegations.
AVK moved for a summary judgment, arguing that it was entitled to judgment as a matter of law on its claims because there were no issues of material fact. With
respect to Medic, AVK asserted that its evidence conclusively established a valid lease, that it had performed its obligations, and that Medic had breached the Lease by failing to pay as agreed, by abandoning the Property, by removing fixtures and equipment owned by AVK, and by damaging the Property during the removal. AVK also asserted that its evidence established that Coleman had unconditionally guaranteed Medic's performance under the Lease and had failed, after notice, to cure the default. AVK sought damages for unpaid rent, fees, and utilities, the vent hood and fire suppression system, and ceiling repairs. In support of its motion, AVK attached the affidavit of its Property Manager, Lomil Truitt, copies of the Lease, Guaranty, and Notice of Default, and an affidavit in support of attorney's fees.
In his affidavit, Truitt testified as follows:
2. [AVK] is the owner of the property located at 9603 Broadway Street, Pearland, Texas 77584, and Plaintiff herein.
3. On or about May 29, 2019, [Medic] (as Tenant) and [Coleman] (as Guarantor) entered into a [Lease] under which there was leased to [Medic] the portion of the shopping center therein described (the "Lease Premises") for a period of thirty-nine (39) months. [Coleman] personally guaranteed the Lease. [AVK] is the party entitled to recover all rentals and other monies due thereunder.
4. [AVK] tendered possession of the leased premises to Defendants and Defendants occupied the same. The [Lease] provided for Defendants to pay rent in the amounts per month set forth therein, plus taxes, CAM and insurance expenses on the first day of each month. Defendants failed to pay the rent plus taxes, CAM and insurance expenses due for February 1, 2020, and thereafter, and abandoned the leased premises.
5. On or about May 19, 2020, Defendants abandoned the Lease Premises and removed fixtures and equipment attached to the leased premises and thus owned by [AVK]. Defendants removed the following equipment and fixtures and caused the following damage to the Lease Premises in removing said fixtures and equipment:
-
Item:
Replacement Cost:
700 S.F. of the ceiling grid
$1,800.00
Fire suppression system
$2,700.00
7-foot Vent Hood
$10,000.00
Total:
$14,500.00
6. Defendants' liability for rent and other charges for breach of the Lease Agreement is set forth as follows:
-
February Rent and CAM Charges
$ 3,200.00
March Rent and CAM Charges
3,200.00
April Rent and CAM Charges (50% paid)
1,600.00
May Rent and CAM Charges (50% paid)
1,600.00
June Rent and CAM Charges
3,200.00
July Rent and CAM Charges (prorated 24/31 days@ $3,200.00)
2,476.80
Late Charges (10% amount owed per Lease)
1,527.68
Fixtures and Equipment taken from Lease Premises
14,500.00
Balance rent owed for September 2019
100.00
CenterPoint Energy (June - September 2019)
531.64
Less Security Deposit
(3,400.00)
TOTAL DUE:
$ 28,536.12
7. [AVK] was able to relet the premises and collect rent beginning on July 25, 2020.
8. Defendants . . . owe [AVK] [$28,536.12] in accordance with the terms of the Lease. [AVK] has made written demand upon Defendants, but Defendants have failed to pay the amount owing.
In their summary-judgment response, Medic and Coleman asserted that AVK failed to conclusively establish the elements of its claims. They further denied "owing rent in the amount of $3,200.00 for the months of February 2019 [sic] through July, 2019 [sic]." They asserted that the Lease provided for a "monthly base
rent of $2,564.00 during this period" and was "silent regarding any specific amount of CAM." They asserted that AVK had relet the Property on May 25, 2020, and not on July 25, 2020. They admitted having removed the vent hood and fire suppression system, but asserted that they had purchased and installed these items.
The trial court granted summary judgment for AVK and awarded it damages against Medic and Coleman in the amount of $28,536.12 and attorney's fees.
Summary Judgment
In their second and third issues, Medic and Coleman argue that the trial court erred in granting summary judgment for AVK on a "conversion cause of action" because AVK did not move for a summary judgment on that cause of action and, alternatively, because AVK failed to present "legally sufficient summary judgment evidence" to support a conversion claim. In their first issue, Medic and...
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