Nalle Plastics Family Ltd. v. Porter

• Decision Date: 18 April 2013
• Docket Number: No. 13–11–00525–CV.,13–11–00525–CV.
• Citation: 406 S.W.3d 186
• Court: Texas Court of Appeals
• Parties: NALLE PLASTICS FAMILY LIMITED PARTNERSHIP, Appellant, v. PORTER, ROGERS, DAHLMAN & GORDON, P.C. and Patrick P. Rogers, Appellees.

406 S.W.3d 186

NALLE PLASTICS FAMILY LIMITED PARTNERSHIP, Appellant,

v.PORTER, ROGERS, DAHLMAN & GORDON, P.C. and Patrick P. Rogers, Appellees.

No. 13–11–00525–CV.

Court of Appeals of Texas,

Corpus Christi–Edinburg.

April 18, 2013.

Vincent L. Marable III, Paul Webb, P.C., Wharton, Mark W. Long, David W. Robertson, Austin, Thomas W. Robertson, Dripping Springs, for Appellant.

James R. Harris, Patrick P. Rogers, Andrew M. Greenwell, for Porter, Rogers, Dahlman & Gordon, P.C.

Patrick P. Rogers, Porter, Rogers, Dahlman, & Gordon, Andrew M. Greenwell, James R. Harris, Harris & Greenwell, L.L.P., Corpus Christi, for Appellee.

Before Justices RODRIGUEZ, GARZA and PERKES.

MEMORANDUM OPINION

Memorandum Opinion by Justice GARZA.

Appellant, Nalle Plastics Family Limited Partnership (“Nalle”), appeals the trial court's venue ruling and its judgment in favor of appellees, Porter, Rogers, Dahlman & Gordon, P.C. (“Porter”), a law firm, and one of Porter's partners, Patrick P. Rogers. By five issues, which we construe as three, Nalle contends that the Nueces County trial court erred by (1) failing to transfer the case to Travis County, (2) rendering summary judgment dismissing all counterclaims brought by Nalle against Porter, and (3) awarding damages and attorney's fees to Porter. By cross-appeal, Porter challenges the trial court's award of attorney's fees. We affirm in part, reverse in part, and remand for further proceedings.

I. Background

Nalle is a Texas limited partnership that owns certain real property in downtown Austin, Texas. In 1991, Nalle's predecessors entered into a long-term commercial lease agreement regarding the subject property. In subsequent years, the predecessor's interest as lessor was transferred to Nalle and the lessee's interest was transferred to Cypress Industrial L.P. (“Cypress”).

Around 2005, a dispute arose between Nalle and Cypress regarding the extent to which Cypress's sub-lessees ¹ were free to remodel buildings on the property. In particular, Nalle believed that the 1991 lease agreement prohibited any lessees or sub-lessees from demolishing, damaging, or destroying any existing improvement on the premises. Cypress, on the other hand, interpreted the lease agreement to permit modifications to the property without Nalle's approval.²

Nalle hired Rogers for legal representation in its dispute with Cypress. Nalle and Rogers did not execute a written contract defining the scope of representation or the fee amount. At the outset of the representation, Rogers performed research and wrote a letter to Cypress's counsel reiterating Nalle's position regarding the lease restrictions. Cypress again expressed its rejection of that position.

Rogers then prepared a “Memorandum Concerning Lessor's Interpretation of Lease” (the “Memorandum”), which set forth Nalle's position regarding the lease. The parties dispute who initially suggested that the Memorandum be prepared and filed as a public record; however, it is undisputed that Rogers prepared the Memorandum and advised that it be filed, and it is undisputed that Nalle reviewed and signed the Memorandum and approved its filing pursuant to Rogers's advice. The Memorandum, which refers to the 1991 lease, states in relevant part:

The purpose of this Memorandum is to set forth of record the Lessors' interpretation of the term “structural component”, as well as, “improvement(s)” as applied and used in Paragraphs 4.3 and 8.4 of the Lease.

Paragraph 4.3 of the Lease provides “Lessee further and [sic] represents that Lessee will not demolish, damage, or destroy any portion of existing improvements on the Premises and that no excavation, boring, or disturbance of the subsurface will be made on the Premises.”

Paragraph 8.4 of the Lease states, in part, as follows: “Lessee, at Lessee's cost and expense, may make modifications to improvements on the Premises which do not require excavation or disturbance of the subsurface, due to possible contamination of the subsurface, and which do not alter any structural component of any improvement on the Premises.”

....

It is the Lessor's interpretation that Paragraph 4.3, when read in context of the Lease, means that the Lessee or any party dealing with the leasehold premisesunder the Lease cannot demolish, damage, or destroy any portion of existing improvements on the Premises.

....

It is the Lessor's interpretation that Paragraph 8.4, when read in context of the Lease, means any leasehold alterations or modifications that involve an alteration of “any structural component of any improvement on the premises” cannot be done under the Lease without approval of the Lessor. It is the Lessors' interpretation that the term “structural component” includes all parts of the existing improvements, each of which has its own structural components. Thus, per the interpretation of the Lessor, any alteration of any leasehold improvements on the Premises would require Lessors' prior approval as each such improvement has its own structural components.

Rogers filed the Memorandum in the public records of Travis County on February 6, 2006.

With Nalle's restrictive interpretation of the lease a matter of public record, Cypress found it increasingly difficult to attract new sub-lessees. Cypress responded by filing suit against Nalle in Travis County. In the suit, Cypress sought a declaratory judgment that it and its sub-lessees are “entitled to modify the interior of the leased premises” and that the Memorandum is “of no force or effect.” Nalle counterclaimed for a contrary declaration. Later, Nalle added an allegation that, due to certain infractions, Cypress was in default of the lease and the lease was therefore terminated.³ In particular, Nalle contended that Cypress violated Austin ordinances by placing parking operations in the city's right-of-way and that it violated state law by performing an excavation in the city's right-of-way without a permit.⁴ In an effort to document the infractions, Rogers and Nalle's president Alan W. Nalle ⁵ repeatedly entered the property to take photographs. Cypress replied by adding allegations that Nalle tortiously interfered with Cypress's contracts and prospective business relations, breached the lease agreement, and breached the covenant of quiet enjoyment. Cypress alleged that, as the result of Nalle's actions, the value of its leasehold interest was diminished by nearly $3 million.

Nalle and Cypress participated in mediation. Although negotiations through counsel proved fruitless, a private conference between the principal officers of the companies—unrepresented by counsel—and the mediator resulted in an oral framework of an agreement. Rogers and The Lee Firm, P.C. (“Lee”) were hired by Nalle to reduce the agreement to writing. They did so, and a written settlement agreement was filed in the underlying lawsuit. Under the agreement, Cypress agreed to pay as much as $900,000 in additional rent over the life of the lease. In exchange, Nalle agreed to withdraw the Memorandum, accept Cypress's interpretation of the lease, and drop its lease termination claim.

When Porter and Lee billed Nalle for the work done on the case, Nalle refused to pay, claiming that the law firms had offered inadequate representation and bad advice. In order to collect the fees, the law firms filed suit against Nalle in Nueces County for breach of contract and quantum meruit. Nalle moved to transfer the case to Travis County, but the trial court denied the motion on May 20, 2009. Nalle then asserted counterclaims against Porter and Lee for professional negligence. The claims were based primarily on three acts and omissions by Rogers which it alleged constituted legal malpractice: (1) filing the Memorandum in Travis County public records; (2) failing to file a forcible detainer action in justice court to evict Cypress after Cypress allegedly defaulted on the lease; and (3) physically entering the subject property to document the alleged lease infractions, which Nalle asserted led to Cypress's quiet enjoyment claim. Nalle also brought counterclaims for breach of fiduciary duty and fraudulent inducement.

Porter moved for traditional and no-evidence summary judgment on Nalle's counterclaims. It later filed a second motion for summary judgment, also asserting traditional and no-evidence grounds. In a series of orders, the trial court excluded portions of Nalle's summary judgment evidence and granted summary judgment dismissing all of Nalle's counterclaims.

The case proceeded to trial on the law firms' claims for unpaid attorney's fees. The jury found in favor of the law firms and the trial court rendered judgment awarding Porter $132,661 in damages plus $150,000 in attorney's fees and pre- and post-judgment interest.⁶ This appeal followed.

II. Discussion

A. Venue

By its first issue, Nalle argues the trial court erred in denying its motion to transfer its claims against Porter to Travis County.

1. Applicable Law and Standard of Review

In general, plaintiffs are allowed to choose venue first, and the plaintiff's choice cannot be disturbed as long as suit is initially filed in a county of proper venue. In re Henry, 274 S.W.3d 185, 190 (Tex.App.-Houston [1st Dist.] 2008, pet. denied); Crown Cent. LLC v. Anderson, 239 S.W.3d 385, 388 (Tex.App.-Beaumont 2007, pet. denied). In a suit in which there is more than one plaintiff, each plaintiff must, independently of every other plaintiff, establish proper venue. Tex. Civ. Prac. & Rem.Code Ann. § 15.003(a) (West Supp.2011). “Proper venue” means: (1) the mandatory venue as provided by statute; or (2) if there is no mandatory venue, the venue provided under the general venue statute or the permissive venue provisions of subchapter C of chapter 15 of the civil practice and remedies code.

The general venue statute states that all lawsuits shall be brought:

(1) in the county in which all or a substantial part of the events or omissions giving rise to the claim occurred;

(2) in the county of...