Superior Broad. Prods. v. Doud Media Grp., L.L.C.

• Decision Date: 29 November 2012
• Docket Number: No. 11–10–00376–CV.,11–10–00376–CV.
• Citation: 392 S.W.3d 198
• Parties: SUPERIOR BROADCAST PRODUCTS, Appellant v. DOUD MEDIA GROUP, L.L.C., Appellee.
• Court: Texas Court of Appeals

392 S.W.3d 198

SUPERIOR BROADCAST PRODUCTS, Appellant

v.DOUD MEDIA GROUP, L.L.C., Appellee.

No. 11–10–00376–CV.

Court of Appeals of Texas,

Eastland.

Nov. 29, 2012.

Douglas T. Floyd, Plano, for appellant.

Brian Steward, Ketterman, Rowland & Westlund, San Antonio, Beth Watkins, Shannon K. Dunn, Law Office of Beth Watkins, San Antonio, for appellee.

Panel consists of: WRIGHT, C.J., McCALL, J., and HILL.¹

OPINION

JIM R. WRIGHT, Chief Justice.

Appellee, Doud Media Group, L.L.C., purchased a radio transmitter from appellant, Superior Broadcast Products. Doud Media experienced problems with the transmitter and, later, filed this suit against Superior. Doud Media alleged, among other things, that the transmitter was defective and that Superior breached an express warranty requiring it to repair or to replace the transmitter. The jury found in favor of Doud Media on its breach of warranty claim and awarded it damages. The trial court entered a final judgment in accordance with the jury's verdict. Because we conclude that the evidence was legally insufficient to support the amount of damages awarded by the jury to Doud Media, we reverse and remand for a new trial on liability and damages.

Doud Media owns and operates two radio stations in Abilene, Texas. Doud Media purchased the subject radio transmitter from Superior in 2003. Richard Doud, the managing member of Doud Media, acted on behalf of Doud Media in connection with its purchase of the radio transmitter from Superior. James Joynt owned Superior and acted on its behalf in connection with the transaction. Elenos Broadcast Equipment Company was the manufacturer of the transmitter. Superior installed the transmitter on Doud Media's premises on April 18 and 19, 2003. Richard Doud and James Thompson, who was an engineer and an independent contractor for Doud Media, were present during the installation. Joynt and Steven Benzer, who was an independent contractor for Superior, were also present during the installation.

On April 18, 2005, Doud Media filed this suit against Superior and Elenos. At that time, Doud Media was not represented by a licensed attorney. Instead, Richard Doud signed the original petition in his capacity as managing member. In its petition, Doud Media alleged that the transmitter was defective. It alleged claims for fraud, and it also alleged that the defendants violated the Deceptive Trade Practices–Consumer Protection Act ² (DTPA) in various respects, including the breach of implied warranties.

Doud Media did not serve its original petition on Superior until March 8, 2007. On March 19, 2007, Superior, represented by counsel, filed a “Motion to Dismiss and for Attorneys Fees as Sanctions.” Superior moved the trial court to dismiss the case on the ground that Richard Doud's representation of Doud Media violated the requirement that a corporation, such as Doud Media, be represented by a licensed attorney. Superior requested the trial court to award it $1,000 in attorney's fees as sanctions against Doud Media.

Doud Media obtained licensed counsel to represent it and thereafter, on March 26, 2007, filed its first amended original petition. In that petition, it continued to assert its DTPA and fraud claims and also added claims for breach of oral and written agreements. Doud Media alleged that the transmitter was defective, that it requested the defendants to remedy the defect, and that the defendants “refused to honor the one-year express warranty provided with the transmitter and repair or replace the transmitter in violation of the agreement entered into and in violation of various implied warranties.” In the certificate of service to the amended petition, Doud Media's counsel of record certified that the amended petition had been served by certified mail, return receipt requested, on Superior's counsel of record.

On May 17, 2007, Superior filed a counterclaim in which it alleged that Doud Media failed to pay it part of the purchase price for the transmitter. Specifically, Superior alleged that Doud Media paid $20,500 toward the purchase of the transmitter but failed and refused to pay the remaining balance due of $20,500. Superior sought to recover the alleged amount due and also sought to recover its attorney's fees. Further, on May 17, 2007, Superior filed an answer that included affirmative defenses. Superior asserted as an affirmative defense that the applicable two-year statute of limitations barred Doud Media's DTPA claims. To support its limitations defense, Superior alleged (1) that, because Richard Doud was not a licensed attorney, Doud Media's original petition “was fundamentally defective and did not properly invoke the jurisdiction of the court”; (2) that Doud Media did not file a valid petition until it filed its amended petition in March 2007; and (3) that, therefore, Doud Media did not file a valid petition within the applicable two-year limitations period. As another affirmative defense, Superior asserted that the doctrine of laches barred Doud Media's claims.

On June 2, 2008, Doud Media filed a second amended petition; it continued to allege claims for breach of oral and written agreements, DTPA violations, and fraud. Additionally, in its second amended petition, Doud Media alleged that “[t]he Defendants have continued to refuse to honor their express warranties.”

On September 3, 2009, Superior filed a traditional motion for summary judgment. In the motion, Superior argued that all of Doud Media's claims were barred by limitations. Superior stated in the motion that “[t]his cause was filed on April 18, 2005, based on events that allegedly occurred on April 18, 2003.” Superior asserted that Doud Media's original petition, which was filed on April 18, 2005, was “illegal and void as a matter of law” because Richard Doud was not a licensed attorney. Superior also contended that the service of the original petition on it was likewise “void.” Because the original petition was “void,” Superior contended that Doud Media failed to file this suit within the two-year limitations period that is applicable to DTPA claims. SeeTex. Bus. & Com.Code Ann. § 17.565 (West 2011).

Doud Media added its contract claims in its first amended original petition, which was filed on March 26, 2007. Superior stated in its motion for summary judgment that “[t]he record is clear that the breach of contract cause of action was not filed until March 28, 2007; three years, 11 months and 10 days after the alleged incident.” Superior asserted that, with respect to Doud Media's first amended petition, “[n]o citation was issued and no service was attempted on [Superior].” Superior contended that Doud Media failed to use due diligence in serving it with the first amended petition and that, therefore, Doud Media's contract and fraud claims were barred by the applicable four-year statutes of limitations.

The trial court held a hearing on Superior's motion for summary judgment. Following the hearing, the trial court granted Superior's motion for summary judgment as to Doud Media's DTPA claims and entered a partial summary judgment dismissing the DTPA claims with prejudice. The trial court denied Superior's motion for summary judgment as to Doud Media's breach of contract and fraud claims.

Doud Media settled its claims against Elenos for $17,250 and nonsuited those claims; the trial court entered an order dismissing those claims from the suit.

The case proceeded to a jury trial. The jury found in favor of Doud Media on its breach of warranty and fraud claims, awarding damages to Doud Media in the amount of $231,000 on its breach of warranty claim and in the amount of $500 on its fraud claim. In response to a proportionate liability question, the jury found that Superior caused 60% of Doud Media's damages, that Elenos caused 30% of Doud Media's damages, and that Doud Media caused 10% of its damages.

In response to other questions, the jury found that Doud Media agreed to pay Superior $37,500 for the radio transmitter and that Doud Media paid $16,000 to Superior for the transmitter. The jury awarded Superior $6,000 in attorney's fees.

Doud Media elected to recover the damages awarded by the jury on its breach of warranty claim. The trial court entered a judgment in accordance with the jury's verdict. In arriving at an award for damages, the trial court reduced the $231,000 in damages found by the jury on Doud Media's breach of warranty claim by 10%, which was Doud Media's percentage of responsibility for its damages as found by the jury. The trial court also gave Superior a credit in the amount of $17,250 for Doud Media's settlement with Elenos, a credit of $21,500 for the amount that the jury found Doud Media owed Superior for the transmitter, and a credit for $6,000 for Superior's attorney's fees. The trial court ordered in its judgment that Doud Media recover from Superior the amount of $163,150 in damages.

Superior presents four issues for review. In its first issue, Superior contends that all of Doud Media's claims were barred by limitations and laches and that, therefore, the trial court erred when it denied its motion for summary judgment. In its second issue, Superior contends that the trial court erred when it submitted questions to the jury on Doud Media's breach of warranty claims. In its third issue, Superior contends that the trial court erred when it submitted a question to the jury that allowed it to award consequential damages. In its fourth issue, Superior challenges the legal sufficiency of the evidence supporting the damages awarded by the jury to Doud Media.

Superior challenges the trial court's denial of its motion for summary judgment on Doud Media's contract and fraud claims. Generally, appellate courts do not have jurisdiction to review the denial of a motion for summary judgment. Cincinnati Life Ins. Co. v. Cates, 927 S.W.2d 623, 625 (Tex.1996); Hines v. Comm'n for Lawyer Discipline, 28 S.W.3d 697, 700 (Tex.App.-Corpus Christi 2000,...