Prime United Petroleum Holding Co. v. Malameel, LLC
| Decision Date | 24 August 2021 |
| Docket Number | 05-20-00032-CV |
| Court | Texas Court of Appeals |
| Parties | PRIME UNITED PETROLEUM HOLDING CO., LLC, Appellant v. MALAMEEL, LLC & MARK ALAMEEL, INDIVIDUALLY, Appellees |
On Appeal from the 160th Judicial District Court Dallas County Texas Trial Court Cause No. DC-19-07898
Before Justices Schenck, Reichek, and Carlyle
Prime United Petroleum Holding Co., LLC appeals the trial's order granting summary judgment against it and dismissing its fraud claim against Malameel, LLC and Mark Alameel individually. In three issues, Prime challenges the trial court's determination that the statute of limitations had expired by the time the lawsuit was filed. In a fourth issue Prime complains the trial court erred by not allowing it to supplement its argument before ruling on the summary judgment motion. For reasons set out below, we overrule all issues and affirm the trial court's order.
In December 2014, Mark Alameel, owner of Malameel, LLC contacted Alex Zidan, owner and manager of Prime (collectively "Prime), about investing in a 3D camera-based technology that was "unlike anything on the market." Alameel sought $120, 000 to fund the creation of a functional, scalable prototype, and Prime agreed to provide $15, 000 in funding at the first of every month until the $120, 000 target was met. Prime told Alameel that it would need a written contract setting out the "responsibilities and expectations" prior to funding, but Alameel insisted that Prime provide funding right away or they would lose their "inventor." Alameel explained that because they could be the first on the market with the technology, Prime could make "an exponential profit" on its money. But, Alameel also said that if for any reason the venture was not successful, Prime's investment money would be returned. Prime deposited money the next day with a "mutual understanding" that a contract would be created detailing the project.
Prime said that thereafter Alameel continually delayed creation of the contract and also refused to account for how Prime's money was being spent. Consequently, in February 2015, Prime requested a meeting of the "involved parties." The meeting was held on February 20 and, among others, was attended by the inventor of the technology ("Jay"), Alameel, and Prime. By this time, Prime had invested about $49, 000 but learned at the meeting that only $20, 000 had been directed to Jay to develop "the deliverable." Two days later, Prime sent Alameel an Excel spreadsheet to list expenditures through that date, but Alameel did not respond.
Over the next several weeks, the parties exchanged lengthy emails regarding their business relationship, proposed terms of a written contract, Alameel's offers of a guarantee to repay the investment under certain conditions, and Prime's frustrations with Alameel and intent to pull out of the company. Finally, on March 26, Prime sent an email stating that the "process" for coming to terms for the contract had taken "far too long" and complained that the terms "keep changing constantly on a daily basis." Prime notified Alameel that until terms could be reached, "all funding was on hold," and if the parties could not agree on the matter, Prime would have to "request withdrawal from the project and reimbursement of all funding submitted to date." Prime further stated that return of the funds would "start immediately" and be structured in the same timeline that the funds were originally provided. Five days later, on April 1, Prime "specified" to Alameel that it wanted its investment money returned. In an April 2 email, Alameel said he would pay back the $60, 000 investment "ASAP" via "a new investor." The money was not repaid.
More than four years later, on May 31, 2019, Prime sued appellees for fraud, alleging that that Alameel had "embezzled" $40, 000 of the money it invested in the project.[1] Prime alleged appellees took the funds and never intended to produce "the deliverable" for which the funds were invested. As damages, Prime sought the recovery of the "cash out of pocket" amount of $60, 694.20 and losses due to the diversion of his funds.
Appellees filed an answer raising several defenses, including the statute of limitations, and filed a motion for summary judgment asserting the limitations defense. Relying on the March emails, appellees asserted that Prime knew no later than March 2015 of its legal injury (the misappropriation of money) and thus limitations had run by the time the lawsuit was filed in May 2019.
The summary judgment hearing was set more than two months later. Seven days before the summary judgment hearing, Prime filed its second amended petition, alleging for the first time that Alameel had induced Prime to continue to invest and stay with the project. Prime asserted Alameel made a personal guarantee to repay Prime ninety-days after a request for a refund, but when repayment was to begin, Alameel failed to do so. Likewise, in its response to the summary judgment motion, Prime asserted Alameel made a promise to begin repaying the money ninety days after a request by Prime. Thus, Prime asserted that its fraud cause of action did not accrue (because no injury had occurred) until ninety days after it requested repayment, or July 1, 2015, which was less than four years after it filed its original petition.
As evidence of its ninety-day assertion, Prime relied on a February 24, 2015 email from Alameel to Zidan, Zidan's brother, and the attorney who was working on the parties' contract. That email, in relevant part, stated as follows:
(Emphasis added.)
In their reply to Prime's response, appellees argued, in part, that Prime's "cherry-picked excerpt" from a single email was insufficient to raise a fact issue and required the court to "ignore the clear context of the communication." Appellees asserted the language was a request from Alameel to the attorney to "come up with alternative language in a draft contract to which Prime was not a party." Appellees asserted no contract was ever signed, Prime admitted no contract was ever signed in its live pleading, and there is no evidence that terms were ever agreed upon. As additional evidence, appellees directed the trial court to an excerpt of an email two days later from Prime's attorney advising the parties that they needed to "figure out the ramifications" if Prime did not "fully fund" the project, agree to what that term meant, and "to lay out default/remedies/breach for not 'fully funding.'"
The trial court granted appellees' motion for summary judgment and dismissed Prime's claims. In its order, the trial court specifically determined that appellees produced conclusive evidence that (1) on April 1, 2015, Prime knew or should have known of the alleged legal injuries about which it complained, including fraud and (2) on April 27, 2015, Prime was aware that appellees had hired legal counsel to defend against the claims brought by Prime in this suit and, thus, as of that date, Prime knew or should have known of its alleged legal injuries. Additionally, the court determined that appellees conclusively established their limitations defense; Prime failed to present sufficient evidence to rebut the defense; and the petition filed on May 31, 2019 was outside the statute of limitations for fraud. After its motion for new trial was overruled by operation of law, Prime filed this appeal.
We review a grant of summary judgment de novo. Cantey Hanger, LLP v. Byrd, 467 S.W.3d 477, 481 (Tex. 2015). A party moving for traditional summary judgment has the burden to prove there is no genuine issue of material fact and that it is entitled to judgment as a matter of law. TEX. R. CIV P. 166a(c); Nixon v. Mr. Prop. Mgmt. Co., 690 S.W.2d 546, 548 (Tex. 1985). If the moving party produces evidence entitling it to summary judgment, the burden shifts to the nonmovant to present evidence that raises a material fact issue. Walker v. Harris, 924 S.W.2d 375, 377 (Tex. 1996).
In deciding whether there is a disputed material fact issue precluding summary judgment, evidence favorable to the nonmovant will be taken as true. Nixon, 690 S.W.2d at 548-49. Every reasonable inference must be indulged in the nonmovant's favor, and any doubts must be resolved in the nonmovant's favor. Id. When, as here, the trial court grants summary judgment on a specific ground, we generally limit our consideration on appeal to the ground on which the trial court relied. See Cincinnati Life Ins Co. v. Cates, 927...
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