Preview
NO. 2017-66216
KELLY COLEMAN
Plaintiff
IN THE DISTRICT COURT OF
VS.
EMILE NASSAR, ROBERT CUMMINGS,
AND THE BOARD OF TRUSTEES OF THE
PINES CONDOMINIUM ASSOCIATION,
INC.
Defendants
HARRIS COUNTY, TEXAS
VS.
ACTION PREMIER HAULING, LLC.
Intervenor
LR LR LR LN LP LP LPL LDP? LP LP LP LP LP
157TH JUDICIAL DISTRICT
THE PINES CONDOMINIUM ASSOCIATION INC.’S OBJECTIONS AND RESPONSE
TO INTERVENOR’S MOTION FOR PARTIAL SUMMARY JUDGMENT
AS TO BREACH OF CONTRACT
TO THE HONORABLE JUDGE OF SAID COURT:
NOW COMES, THE PINES CONDOMINIUM ASSOCIATION, INC. (the “Association”),
intervenor defendant in the above entitled and numbered cause of action and files this its objections
and response to Intervenor’s, ACTION PREMIER HAULING, INC. (‘Intervenor”), motion for
partial summary judgment as to breach of contract and would respectfully show the Court as follows:
I.
INTRODUCTION
1. The Intervenor’s action against the Association relates to an alleged contract that the
Intervenor asserts was entered by the Association’s former president, Emile Nassar, in connection
with the removal of debris from the Association’s property after Hurricane Harvey. The Intervenor’s
Motion for Partial Summary Judgment is limited to seeking a liability finding for breach of contract
and does not seek damages, attorney fees, nor any other finding. In order for the Intervenor’s Motion
for Partial Summary Judgment to be granted, the Intervenor must meet its summary judgment burden
of establishing the existence of a valid contract and breach. For the reasons set forth below, the
Intervenor’s motion fails to present competent summary judgment evidence as to the existence of
avalid contract and therefore, no breach can be shown. The Association sets forth various objections
1to Intervenor’s purported summary judgment evidence demonstrating that the purported summary
judgment evidence is not proper summary judgment evidence and can not be considered in support
of Intervenor’s Motion for Partial Summary Judgment. Additionally, the Association submits
controverting summary judgment evidence demonstrating that the alleged contract made the basis
of Intervenor’s motion is not valid nor enforceable against the Association. Based on the foregoing,
as more specifically set forth below, the Intervenor’s Motion for Partial Summary Judgment must
be DENIED.
IL.
OBJECTION TO INTERVENOR’S SUMMARY JUDGMENT EVIDENCE
2. Intervenor, ACTION PREMIER HAULING, LLC., as Movant in this motion for partial
summary judgment has the burden to submit competent summary judgment evidence to show that
there are no issues of material fact in dispute and that it is entitled to judgment as a matter of law on
the issue presented. (Rule 166a(c), Texas Rules of Civil Procedure (“TRCP”)). The burden of proof
rests initially on Intervenor as the Movant. Cloys v. Turbin, 608 S.W.2d 697 (Tex.App.—Dallas 1980,
no writ). The summary judgment evidence must be by attached certified documents or summary
judgment affidavit. (Rule166a(f) TRCP). The Intervenor submits no competent summary judgment
evidence to support its claim for breach of contract. Therefore its motion fails on its face and should
be DENIED. The Association objects to Intervenor’s purported summary judgment evidence
Exhibits “A”, “B”, “C”, “D” and “E” which is based on conclusory statements and hearsay and asks
the Court to exclude such exhibits as more particularly described below. The purported summary
judgment evidence of Intervenor is as follows:
Intervenor’s Exhibit “A”: Affidavit of Matthew Moody.
Intervenor’s Exhibit “B”: Random excerpts from the Temporary Injunction
Hearing on October 19, 2017, without any reference
as to which witness is testifying and no foundation is
provided for any of the testimony.
Intervenor’s Exhibit “C”: Purported Service Agreement and miscellaneous
documents without any foundation. Additionally such
purported agreement does not contain the essential
elements to constitute a contract.Intervenor’s Exhibit “D”: Unsworn statement purportedly by Emile Nassar.
Such statement is hearsay and inadmissable in a
summary judgment proceeding; and
Intervenor’s Exhibit “E”: Alleged minutes without proper foundation and
constitutes hearsay.
Intervenor’s Exhibit “A”: Affidavit of Matthew Moody
3. The Association objects to the first sentence of paragraph two (2) of the Affidavit of Matthew
Moody as an improper conclusory statement which states as follows: “On September 10, 2017,
Action entered into a written contract with The Pines Condominium Association, Inc. (the
Association”), through its president, Emile Nassar.” “A conclusory statement is one that does not
provide the underlying facts to support the conclusion. Rizkallah v. Conner, 952. S.W.2d 580, 587
(Tex.App.—Houston [1* Dist.] 1997, no pet.). Conclusory statements are not competent summary
judgment evidence because they are not credible or susceptible to being readily controverted)” Jd.
Schindler v, Baumann, 272 S.W.3d 793, 796 (Tex.App.—Dallas 2008, no pet.) The above sentence
should be excluded as summary judgment evidence because it is a conclusory statement.
Additionally, a review of the document which the Intervenor is alleging to be a contract, expressly
states: “In the event of an unauthorized signature on behalf of a customer, the undersigned agrees
to be personally liable for amounts not paid when due.” (Emphasis added.) In other words, the
Intervenor realized and planned for the fact that their “service agreement” could be signed by
someone that was not authorized to do so and in such event, the individual who signed the “service
agreement” (i.e. Emile Nassar) would be individually liable. In actuality, that is exactly what
occurred here, as the Association has never approved, agreed or ratified the service agreement.
Therefore, the Association is not bound by such document. The conclusory statement, which is the
first sentence of paragraph 2 of the Affidavit of Matthew Moody (Intervenor’s Exhibit “A”), is
objected to as conclusory and should be excluded.
4. The last sentence of paragraph 3 of the Affidavit of Matthew Moody is inadmissible hearsay
and states as follows: “Mr. Nassar was very insistent that the work be done as quickly as possible
and Mr. Nassar received a lot of pressure from the condominium owners to clean up the complex
3to prevent mold, bacteria and other effects of the water soaked debris.” Such statement constitutes
hearsay and hearsay may not be made the basis of a summary judgment. Koehler v. Sears, Roebuck
& Co., No. 05-98-01325-CV, 2001 WL 611453 (Tex.App.—Dallas, June 6, 2001, no pet.), citing
Youngstown Sheet & Tube Co. v. Penn, 363 S.W.2d 230, 233 (Tex. 1962); See TEX.R.CIV.P.
166a(f).
5. The last two sentences of paragraph 5 of the Affidavit of Matthew Moody (Intervenor’s
Exhibit “A”) is also inadmissible hearsay and states as follows: “The Association, through its
management company, told Action that the payment had been approved and was in the mail.
However, a few hours later, the management company called and stated that they had cancelled the
check because of the temporary restraining order.” These two sentences do not identify any
individual and a “management company” is unable to speak. A management company is an entity,
not a person. The two sentences described above are objected to due to lack of foundation and
hearsay. Hearsay may not be made the basis of a summary judgment. Koehler v. Sears, Roebuck
& Co., No. 05-98-01325-CV, 2001 WL 611453 (Tex.App.—Dallas, June 6, 2001, no pet.); citing
Youngstown Sheet & Tube Co. v. Penn, 363 S.W.2d 230, 233 (Tex. 1962); See TEX.R.CIV.P.
166a(f). The Affidavit does not state any person who claims to have been associated with the
management company and therefore, such alleged statement cannot be verified as being authorized,
authentic or applicable to the Association. Such hearsay should be excluded from consideration.
Intervenor’s Exhibit “B”: Random Excerpts from the Temporary Injunction Hearing
6. Intervenor’s Exhibit “B” appears to consist of selected sections from the October 19, 2017
Temporary Injunction Hearing in this case. Such selected pages are objected to as the random pages
do not identify the witness or witnesses involved in giving such testimony and do not provide any
foundation or personal knowledge of the person testifying. Without identification of the witness or
witnesses and a proper foundation of their alleged knowledge of the witnesses Exhibit “B” is
inadmissible and should be excluded from consideration of their summary judgment motion due to
lack of proper foundation and as hearsay. Koehler v. Sears, Roebuck & Co., No. 05-98-01325-CV,2001 WL 611453 (Tex.App.—Dallas, June 6, 2001, no pet.), citing Youngstown Sheet & Tube Co.
v. Penn, 363 S.W.2d 230, 233 (Tex. 1962); See TEX.R.CIV.P. 166a(f)
Intervenor’s Exhibit “C”: Purported “Service Agreement”
7. The Association objects to the Intervenor’s Exhibit “C” , the purported “service agreement”
as the document is not verified by a proper business records affidavit and is therefore considered
hearsay and inadmissible. Koehler v. Sears, Roebuck & Co., No. 05-98-01325-CV, 2001 WL 611453
(Tex.App.—Dallas, June 6, 2001, no pet.); citing Youngstown Sheet & Tube Co. v. Penn, 363 S.W.2d
230, 233 (Tex. 1962); See TEX.R.CIV.P. 166a(f). Additionally, there is no summary judgment
evidence indicating that this “service agreement” is intended to bind the Association. The face of
the service agreement states that the company is “Nick Cummings” and the contact person is “Nick
Cummings”. There is no summary judgment evidence linking Nick Cummings to the Association.
The service agreement specifically states that in the event of unauthorized signature on behalf of a
customer, the undersigned agrees to be personally liable for amounts not paid when due. There is
no summary judgment evidence indicating that any of the signers were authorized on behalf ofa the
Association to enter into this alleged “service agreement” document and there is no business records
affidavit to authenticate the document. As such, the purported service agreement is objected to on
the basis of hearsay and should be excluded. Koehler v. Sears, Roebuck & Co., No. 05-98-01325-
CV, 2001 WL 611453 (Tex.App.—Dallas, June 6, 2001, no pet.), citing Youngstown Sheet & Tube
Co. v. Penn, 363 S.W.2d 230, 233 (Tex. 1962); See TEX.R.CIV.P. 166a(f).
Intervenor’s Exhibit “D”: Unsworn Statement of Emile Nassar - (it is not an affidavit)
8. The “Affidavit of Emile Nassar” submitted by Intervenor as Exhibit “D” is not an affidavit
at all. Although the document purports to have been signed by Emile Nassar, there is no notarization
of his signature. The Association objects to Exhibit “D” as an unsworn statement and hearsay.
Accordingly, it is an unsigned and unsworn statement. An unsworn statement does not constitute
proper summary judgment evidence pursuant to Rule 166(A)(f) of the Texas Rules of Civil
Procedure. Koehler v. Sears, Roebuck & Co., No. 05-98-01325-CV, 2001 WL 611453(Tex.App.—Dallas, June 6, 2001, no pet.), citing Youngstown Sheet & Tube Co. v. Penn, 363 S.W.2d
230, 233 (Tex. 1962); See TEX.R.CIV P. 166a(f).
Intervenor’s Exhibit “EK”: Purported Minutes of the Association’s Executive Session
9. The Association objects to Exhibit “E” as hearsay. There is no summary judgment evidence
to support Exhibit “E” as an exception to the hearsay rule. There is no business records affidavit or
other summary judgment evidence to support Exhibit “E” as being admissible. Exhibit “E” is simply
hearsay and hearsay may not be made the basis of a summary judgment. Koehler v. Sears, Roebuck
& Co., No. 05-98-01325-CV, 2001 WL 611453 (Tex.App.—Dallas, June 6, 2001, no pet.); citing
Youngstown Sheet & Tube Co. v. Penn, 363 $.W.2d 230, 233 (Tex. 1962); See TEX.R.CIV.P.
166a(f).
10. The Association asserts the objections to the evidence described above and asks the Court
to exclude such inadmissible summary judgment evidence on the grounds stated therein.
11. Accordingly, based on hearsay and the other objections set forth above, the Intervenor’s
unsupported and unverified summary judgment evidence (Exhibits “A”, “B”, “C”,“D” and “E”) are
inadmissible and should be excluded. The Association hereby moves that all of Intervenor’s
Summary Judgment exhibits and purported summary judgment evidence be excluded and ruled to
beinadmissable. The Court, by denying the Intervenor’s motion for partial summary judgment may
impliedly sustain the Association’s objections. Tex.App.P. 33.1(a)(1)(A).
12. Without waiving the foregoing objections and continuing to assert same, the Association
shall respond to the Intervenor’s motion for partial summary judgment on this issue of breach of
contract.
Til.
SUMMARY OF RESPONSE
13. The Intervenor is not entitled to a partial summary judgment on its breach of contract claim
because there is a fact issue as to whether or not the acts made the basis of its Motion for Partial
Summary Judgment (which occurred on October 3, 2017) were valid and bound the Association to
the alleged “service agreement”. As will be shown from the controverting summary judgment
6evidence submitted by the Association, the October 3, 2017 executive session meeting was invalid
and a violation of the Association’s governing Bylaws, and a violation of the Texas Property
Code. Asa result of such violations, any business which may have occurred at the October 3, 2017
executive session was invalid and ineffective. Therefore, the ratification of the alleged contract
made the basis of Intervenor’s contract claim is not valid and not binding on the Association.
Additionally, any other decisions made at the October 3, 2017 executive session were also invalid
and not binding on the Association. Finally, the document which the Intervenor alleges is a valid
contract, lacks essential elements to be a contract and cannot support Intervenor’s contract claim.
FACTUAL DISPUTES
14. The basis of Intervenor’s contract claim is set forth in paragraphs 14 and 15 of Intervenor’s
motion for partial summary judgment. The primary factual disputes are (1) whether or not the
independent acts of the Association’s president, Emile Nassar, without the Board’s knowledge or
approval are binding on the Association, (2) whether the events which occurred at the secret and
improperly called executive session on October 3, 2017 were valid and binding on the Association,
and (3) whether the alleged “service agreement” meets the required elements for a contract in Texas.
The Intervenor’s Motion for Partial Summary Judgment asserts that on October 3, 2017, the Board
of Managers had an executive session where the independent acts of Emile Nassar were ratified by
the Board of Managers and where the Board of Managers agreed to make a final payment to
Intervenor in the amount of $319,725.00. A review of the facts as set forth in the Controverting
Affidavit of the Association’s Secretary, Betty Martin, submitted herewith as Exhibit “A” reveal
facts which demonstrate that any business conducted at the October 3, 2017 executive session was
improper, invalid and not binding on the Association. Fact issues exist as to the events of the
October 3, 2017 executive session which require the Intervenor’s Motion for Partial Summary
Judgment to be denied.Iv.
ASSOCIATION’S SUMMARY JUDGMENT EVIDENCE
15. The Association submits the following summary judgment evidence in support of its
response and in contravention of Intervenor’s motion for partial summary judgment:
Association Exhibit “A” Affidavit of Betty Martin, Association Secretary who
attended the October 3, 2017 executive session
meeting.
Association Exhibit “B” Certified copy of Notice of Dedicatory Instruments
which include (1) the Articles of Incorporation and (2)
the Bylaws of the Association for The Pines
Condominium Association, Inc.
ASSOCIATION’S EXHIBIT “A” - BETTY MARTIN’S AFFIDAVIT
16. The Intervenor alleges that the Association had an executive session board meeting on
October 3, 2017. A true and correct copy of the affidavit of Betty Martin is attached hereto as
Exhibit “A” and is incorporated herein by reference for all purposes. Set forth in Betty Martin’s
affidavit is a detailed description of what occurred in connection with the October 3, 2017 board
meeting and executive session. Betty Martin’s affidavit states as follows:
1. "My name is BETTY MARTIN. I am over 21 years of age, of sound
mind, and fully competent to make this Affidavit. I have never been
convicted of a felony or a crime of moral turpitude. I have personal
knowledge of the facts as stated herein and all such facts are true and correct
based on my personal knowledge.
2. I was an owner of property at the Pines Condominiums during
Hurricane Harvey. I was also a member of the Board of Managers (the
“Board”) of The Pines Condominium Association, Inc., a Texas non-profit
corporation (the “Association”) for over two (2) years ending in November
2017. During my time on the Board I served as the Secretary of the
Association for approximately the same period of time that I served on the
Board. I have personal knowledge of the facts set forth in this affidavit based
on my service and tenure as a Board member and as the Secretary for the
Association. I was the Secretary of the Association and the Board during the
Hurricane Harvey event. I did not leave the Board until some time in
November 2017.
3. After Hurricane Harvey a Board meeting occurred on October 3, 2017
at The Pines Clubhouse. I believe all of the Board members (eight (8) at that
time) attended that meeting and many owners were present to observe the
meeting, but no business was conducted and no voting occurred at that
meeting.4. The October 3, 2017 Board meeting was concluded and adjourned
without any announcement to the Board members or the owners present of
continuing the meeting or going into executive session to continue the
meeting. However, during the October 3, 2017 meeting I sent a hand-written
note to the Board president suggesting that the Board go to La Madeleine
Restaurant to discuss Association business. I am aware that my note
suggesting an executive session was passed to some of the other Board
members but I am also aware that my note was NOT passed to Board
members who we thought did not agree with what was being discussed.
Accordingly, not all of the Board members received my hand-written note
that we were going to have an executive session at La Madeline restaurant.
Of course, no official notice was sent out to any Board members or to the
owners about this secret executive session Board meeting which was going
to occur at La Madeline Restaurant.
4. Later in the day on October 3, 2017, I attended an executive session
Board meeting of some of the Board members at La Madeleine Restaurant.
I recall that Board Members, Larry Brown, Iris Mills, and Toni Soltani, did
not attend the executive session Board meeting. None of the other owners
attended this executive session meeting because it was kept secret and no
notice was issued to any of the owners. No formal meeting notice was issued
about this executive session Board meeting and no formal notice was given
to the other Board members. Obviously, since the second meeting/executive
session Board meeting was not thought of until October 3, 2017, no one
could give the required five (5) days advance notice required by the
Association’s By-laws. There were 5 of the 8 Board members in attendance
at the executive session Board meeting. Three (3) of the eight (8) Board
members did not attend the executive session board meeting as identified
above.
5. After the executive session Board meeting on October 3, 2017, the
Board did not make any announcement of what had occurred during the
executive session to anyone at that time.
6. lam aware that the Bylaws for the Association require that notice of
all Regular and Special Meetings of the Board be given to each Board
Manager, personally or by mail, telephone or telegraph, at least five (5) days
prior to the day named for such meeting. Such notice was NOT provided to
me nor provided to any other Board Manager, in connection with the first or
second (executive session) Board meetings which occurred on October 3,
2017.
7. As the Secretary of the Board on October 3, 2017, I did not give any
notice of either the first or second (executive) meetings of the Board to
anyone. The second (executive session) Board meeting was called by passing
a note to some but not all of the Board members. At least five (5) days prior
notice was never given to anyone.
8. During the October 3, 2017 executive session/second Board meeting,
we were never provided any of the details of any agreement or alleged
contract between the Association and Action Premier Hauling, LLC.9. Based on the facts set forth above, it appears to me that the second
(executive session) board meeting which occurred on October 3, 2017 was
not properly called and was in violation of the By-laws of the Association
because not all Board members were informed of the meeting, five (5) days
notice was not given to anyone, and not all Board members attended the
meeting.”
The affidavit of Betty Martin (attached as Exhibit “A”) and described above, demonstrates
that the Board intentionally did not provide the Bylaw required notice ofa board meeting/executive
session to existing Board Members in to avoid them expressing opposing views on matters to be
discussed. The opportunity to express opposing views is exactly why ALL Board members must be
given notice of all Board meetings. Ms. Martin’s affidavit acknowledges that the acts and omissions
related to the purported executive session (which occurred on October 3, 2017), and which she
participated in, were a violation of the Association’s Bylaws, the Texas Property Code and were
improper. Accordingly, such improper conduct can not result in valid actions of a board and can not
be binding on the Association as more fully explained by the Texas authorities set forth below.
Vv.
ASSOCIATION’S EXHIBIT “B” - BYLAWS
VIOLATION OF BYLAWS
17. In order to fully understand the illegality associated with the October 3, 2017 executive
session board meeting, a review of the Association’s Bylaws in connection with board meetings is
needed. See Article IV of the Bylaws (see Exhibit “B”) related to the Board of Managers.
Specifically, the Bylaws under Article IV, paragraphs 9 and 10 discuss regular board meetings and
special board meetings. The Bylaws state as follows:
9. Regular Meetings. Regular meetings of the Board of Managers may be held
at such time and place as shall be determined, from time to time, by a
majority of the Managers, but at least one such meeting shall be held during
each calendar quarter. Notice of regular meetings of the Board of Managers
shall be given to each Manager, personally or by mail, telephone or telegraph,
at least five (5) days prior to the day named for such meeting.
10. Special Meetings. Special meetings of the Board of Managers may be called
by the President on five (5) days notice to each Manager, given personally or
by mail, telephone or telegraph, which notice shall state the time, place (as
hereinabove provided) and purpose of the meeting. Special meetings of the
Board of Mangers shall be called by the President or Secretary or Assistant
Secretary of the Association in like manner and on like notice on the written
request of one or more Manager[s].
1018. As can be read from the Association’s governing Bylaws (Exhibit “B”), notice of regular
meetings and special meetings of the Board of Managers shall be given to each Manager, personally
or by mail, telephone or telegraph, at least five (5) days prior to the day named for such meeting.
The Bylaws set forth the specific method in which the notice of meetings must be given to each
Manager and notice shall be given a minimum of five (5) days prior to the meeting. Both of these
requirements were not met with regard to the October 3, 2017 board meeting and executive session
as verified by the Association’s Board Secretary, Betty Martin. (See Betty Martin’s Affidavit,
Exhibit “A’’.)
October 3, 2017 (First) Board Meetin.
19. The Association acknowledges that ifa Manager attends a meeting, the requirement of notice
is waived. Therefore, with regards to the October 3, 2017 board meeting in which all of the
Managers were in attendance, the meeting notice requirements which were not followed, were
waived. However, as stated in paragraph 3 of Betty Martin’s affidavit, “No business was conducted
and no voting occurred at the October 3, 2017 board meeting.” Therefore, the allegations by the
Intervenor that the contract was ratified and payment to him was approved did not occur at the board
meeting in which all of the Managers attended.
October 3, 2017 (Second) Secret Executive Session
20. In the (first) paragraph 4 of Betty Martin’s affidavit, she explains that after the board meeting
was concluded, a secret executive session meeting occurred where only certain Board Managers
were given notice and invited to attend. Those Board Managers who were at the earlier meeting but
who were not in agreement with what was being discussed, were not given notice and were not
invited to the executive session. This lack of notice was in violation of the Association’s Bylaws
(Exhibit “B”)
21. In the (second) paragraph 4 of Betty Martin’s affidavit, she states that three (3) Board
Managers did not attend the executive session board meeting. Accordingly, those three (3) Board
Managers (i.e., Larry Brown, Iris Mills and Tony Soltani) could not have waived notice of the
11executive session board meeting on October 3, 2017 because they did not attend. Additionally, Betty
Martin verifies that the required notice pursuant to the Bylaws was not given. Betty Martin was
present at the executive session board meeting and can verify that there were only five (5) of the
eight (8) Board Managers in attendance at the executive session board meeting. She also can verify,
as Secretary of the Board, that proper notice pursuant to the Bylaws was not given. Betty Martin’s
affidavit in paragraph 6 specifically states that the notice required by the Bylaws was not provided
to her nor provided to any other Board Manager in connection with the first or second (executive
session) board meetings which occurred on October 3, 2017. She further states that during the
October 3, 2017 executive session board meeting, they were never provided any of the details of the
alleged contract between the Association and Action Premier Hauling, LLC. Finally, Betty Martin
concludes her affidavit by stating that it appeared to her that the executive session board meeting on
October 3, 2017 was not properly called and was in violation of the Bylaws of the Association
because not all Board Managers were informed of the meeting, five days’ notice was not given to
anyone and not all Board Managers attended the meeting.
22. Based on the Association’s summary judgment evidence of the certified copy of the Bylaws
of the Association (Exhibit “B”) and the Affidavit of Betty Martin (Exhibit A”), it clear that any
business conducted at the October 3, 2017 executive session was not proper, not authorized and not
valid. At a minimum, a fact issue exists as to the events related to the October 3, 2017 executive
session which warrants the denial of Intervenor’s Motion for Partial Summary Judgment.
VI.
AUTHORITIES
23. The Texas Fourteenth Court of Appeals previously ruled in Swonke v. First Colony
Community Services Association, Inc., 14-09-0019-CV, 2010 WL 2361691 (Tex.App.—Houston [14"
Dist.] June 15, 2010, no pet.) that if the notice provided in the Bylaws is not followed, then notice
of a board meeting is not properly provided. The Fourteenth Court of Appeals further discusses that
when Bylaws set forth specific means by which notice of a meeting should be given, that it is
intended by that document to be exclusive of other methods. Jd. In the case before this Court, the
12applicable Bylaws are very specific that notice of regular and special board meetings must be given
in the manner prescribed. It is undisputed and explained in the details set out in the Affidavit of
Betty Martin (Exhibit”A”) that none of the notice procedures set forth in the Bylaws were followed
in connection with the October 3, 2017 board meeting or executive session.
24. Asaresult of improper notice of meeting which occurred in connection with the October 3,
2017 executive session, any business which may have occurred during the executive session was
invalid, and not binding on the Association. Jd. In the Swonke case the appellant homeowners
contended that the holding of a meeting in the absence of proper notice under the bylaws invalidated
any action taken at that meeting. The appellant sought summary judgment on that point which the
court did not grant for reasons unrelated to the lack of proper notice. As this was a summary
judgment proceeding, the court declined to grant summary judgment for two reasons:
A. Whether the committee in question was the appropriate committee for
considering candidates for the 2007 election. The court felt that a fact
issue existed as to this anteceding question and it would be premature
to decide the dependent issue of notice; and
B. The appellants failed to establish as a matter of law that the proper
remedy was the relief that they requested in their motion.
Nevertheless, the Fourteenth Court of Appeals cites various authorities which affirm the opinion that
failure to give proper notice will render the proceedings at such a meeting invalid. The Fourteenth
Court of Appeals in the Swonke decision states as follows:
On appeal, appellants contend that the holding of a meeting in the absence of
proper notice under the bylaws invalidated any action taken at that meeting.
See Chen, 2004 WL 35989, (affirming trial court’s finding that alleged
directors of incorporated religious group had not been lawfully elected at
meeting called without written notice); Been v. Producers Ass'n of San
Antonio, Inc., 352 8.W.2d 292, 293 (Tex.Civ.App—San Antonio 1961, no
writ)(affirming temporary injunction reversing removal of directors at
improperly noticed meeting where directors had not waived their rights under
the bylaws); 7 C.J.S. Association §1 18 (2004) (“Failure to give proper
notice will render the proceedings at a meeting invalid.”). (Emphasis
added.)
1325. The Association is a Texas non-profit corporation. A certified copy of its Articles of
Incorporation are included in Exhibit “B” submitted herewith. As such, the case law cited herein
as to corporations also applies to the Association because it to is a Texas non-profit corporation. A
generally accepted principle in relation to meetings of associations is: “Failure to give proper notice
will render the proceedings at a meeting invalid.” 7 C./.S. Association § 18.
26. In Chen v. Tseng, No. 01-02-01005-CV, 2004 WL 35989 (Tex.App.—Houston [1* Dist.]
2004, no pet.), a meeting of the members was called without any written notice. At the meeting, an
individual who was not present was removed from office and a new board and new officers were
elected. The trial court found, in effect, that all officers and directors elected at the meeting of the
members in 1993 and 2002 and the individuals who were otherwise named directors in the time
between those two meetings were not elected as directors in accordance with the Bylaws and were,
therefore, not duly and lawfully elected. The decision of the trial court was affirmed by the 1* Court
of Appeals. Accordingly, because the Bylaws were not followed, the decisions made at the meeting
which was improperly called, were invalid. Jd.
27. In Been v. Producers Ass'n of San Antonio, Inc., 352 S.W.2d 292, 293 (Tex.Civ.App.—San
Antonio 1961, no writ), a ten day statutory notice requirement for a meeting was ignored and
instead five days’ notice of a meeting to remove directors was used. The San Antonio Court of
Appeals ruled affirming a temporary injunction reversing removal of directors at an improperly
noticed meeting where directors had not waived their rights under the Bylaws. Jd.
Vil.
VIOLATION OF THE TEXAS PROPERTY CODE
28. The Texas Property Code also has provisions which were violated in connection with the
October 3, 2017 executive session. Section 82.108(b) requires that meetings of the association and
its board must be open to unit owners, subject to the right of the board to adjourn a meeting of the
board and reconvene in closed executive session. However, Section 82.108(b) specifically limits
the subjects in which a board can consider during a secret executive session. Ratifying a contract
14or approving payment to a vendor are not allowed to be discussed or decided in an executive session.
An open meeting is required. Section 82.108(b) of the Texas Property Code states as follows:
(b) Meetings of the association and board must be open to unit owners,
subject to the right of the board to adjourn a meeting of the board and
reconvene in closed executive session to consider actions involving
personnel, pending litigation, contract negotiations, enforcement actions,
matters involving the invasion of privacy of individual unit owners, or
matters that are to remain confidential by request of the affected parties and
agreement of the board. The general nature of any business to be considered
in executive session must first be announced at the open meeting.
Section 82.108(b) was violated by the secret executive session which occurred on October 3 2017.
29. There are certain specified subjects which the board may consider during an executive
session, but the alleged acts which the Intervenor claims occurred during the October 3, 2017
executive session are not included in the limited subjects of 82.108(b). Therefore, if in fact the
Board of Managers had approved or ratified a contract during the executive session and/or approved
payment to the Intervenor during the executive session, those acts would have violated Section
82.108(b) of the Texas Property Code and be invalid.
30. Additionally, 82.108(e) says that notice of meeting of the board must be given as provided
by the bylaws. The applicable bylaws provisions are set forth above. Accordingly, not only was the
October 3, 2017 executive session meeting a violation of the Association’s Bylaws, it also
constituted a violation of 82.108(e) of the Texas Property Code.
31. For all of the above reasons, the Intervenor’s allegation that the Association, through an
executive session, ratified the contract between the Association and Intervenor, as well as approved
any payment to the Intervenor at the October 3, 2017 executive session is in error. Any such acts
during an illegal and improper executive session are invalid and unenforceable. At a minimum, the
facts associated with what actually occurred at the October 3, 2017 executive session constitutes a
fact issue which warrants the denial of Intervenor’s motion for partial summary judgment.
15VI.
NO VALID CONTRACT
No Contract Exists because One or more Elements of Contract Formation Failed to be Met.
32. Parties form a binding contract when the following elements are present: (1) an offer, (2) an
acceptance in strict compliance with the terms of the offer, (3) a meeting of the minds, (4) each
party's consent to the terms, and (5) execution and delivery of the contract with the intent that it be
mutual and binding. Roman v. Roman, 193 S.W.3d 40, 50 (Tex. App.--Houston [1st Dist.] 2006, pet.
filed), Wal-Mart Stores, Inc. v. Lopez, 93 S.W.3d 548, 555-56 (Tex.App.--Houston [14th Dist.]
2002, no pet.); Baylor Univ. v. Sonnichsen, 221 S.W.3d 632, 635 (Tex. 2007); David J. Sacks, P.C.
v. Haden, 206 S.W.3d 447, 450 (Tex. 2008) (parties must have had a meeting of the minds and
communicated their consent to the agreement). "Meeting of the minds" describes the mutual
understanding and assent to the agreement regarding the subject matter and the essential terms of the
contract. Weynand v. Weynand, 990 8.W.2d 843, 846 (Tex. App.--Dallas 1999, pet. denied). Mutual
assent, concerning material, essential terms, is a prerequisite to formation of a binding, enforceable
contract. T.O. Stanley Boot Co. v. Bank of El Paso, 847 S.W.2d 218, 221 (Tex. 1992).
33. The Fifth Circuit Court of Appeals has recognized that, under Texas law, essential or material
terms are those that parties would reasonably regard as vitally important elements of their bargain.
Neeley v. Bankers Trust Co., 757 F.2d 621, 628 (5th Cir. 1985).
34. A contract is not legally binding unless its terms are sufficiently definite so that a court can
understand what the promisor undertook. 7.0. Stanley Boot Co., Inc. v. Bank of El Paso, 847 S.W.2d
218, 221 (Tex. 1992); Vermont Information Processing, Inc., 227 S.W.3d at 852. Whether an
agreement fails for indefiniteness is a question of law to be determined by the court. 7.0. Stanley
Boot Co., Inc., 847 8.W.2d at 222; COC Servs., Ltd. v. Comp USA, Inc., 150 S.W.3d 654, 664 (Tex.
App. - Dallas 2004, pet. denied). When an agreement is so indefinite as to make it impossible for a
court to determine the legal obligations of the parties, the contract is not enforceable. Vermont
Information Processing, Inc., 227 S.W.3d at 852; Mann vy. Trend Expl. Co., 934 S.W.2d 709, 713
(Tex. App. — El Paso 1996, writ denied).
1635. While Texas courts favor validating transactions rather than voiding them, a court may not
create a contract where none exists and generally may not add, alter, or eliminate essential terms.
Kelly v. Rio Grande Computerland Group, 128 S.W.3d 759, 766 (Tex. App. - El Paso 2004, no pet.)
(internal citations omitted). Whether all essential terms have been included is a question of law. See
E. P. Towne Ctr. Partners v. Chopsticks, Inc., 242 S.W.3d 117, 122 (Tex. App. - El Paso 2007, no
pet.). A promise or term is an essential part of an agreement if, when contracting, the parties would
reasonably regard it as a vitally important element of the bargain. Domingo v. Mitchell, 257 S.W.3d
34, 40-41 (Tex. App. - Amarillo 2008, pet. denied).
36. In addition, we note that the Supreme Court of Texas has instructed, "Each contract should
be considered separately to determine its material terms." "Advance Components, Inc. v. Goodstein,
608 S.W.2d 737, 739 (Tex. Civ. App.--Dallas 1980, writ ref'd n.r.e.).
37. The Texas Court of Appeals determined in Potcinske v. McDonald Prop. Invs. Ltd, that the
lack of a material term creates an unenforceable contract. In Potcinske, The Court of Appeals
reasoned that whether the purchase of property would be seller financed was an important and
material element of the bargain as manifested by the parties’ focus on that provision during
negotiations. Potcinske v. McDonald Prop. Invs., Ltd., 245 S.W.3d 526, 527 (Tex. App.—Houston
[1st Dist.] 2007). As such, the Court in Potcinske concluded that the omission of how the
transaction would be financed was a material term required to form a contract, thus, making the
contract unenforceable.
38. Here, the Association asserts that no enforceable contract was formed between the parties
because the following essential elements are missing from the alleged contract: (1) acceptance in
strict compliance with the terms of the offer, (2) a meeting of the minds, (3) each party's consent to
the terms, and (4) execution and delivery of the contract with the intent that it be mutual and binding.
Additionally, the contract price is omitted from the proposed contract. The term of the contract is
ambiguous based on the Movant’s summary judgment evidence (two different terms on the two
agreements of exclusivity, 12 month term on the proposed contract). Finally, valid consent of the
Board is missing making any such contract invalid.
17IX.
TRADITIONAL SUMMARY JUDGMENT STANDARD OF REVIEW
39. The Intervenor’s motion for partial summary judgment is a traditional motion for summary
judgment under Rule 166a of the Texas Rules of Civil Procedure. As such, the Intervenor has the
burden to offer admissible summary judgment evidence that there are no genuine issues of material
facts, and that it is entitled to judgment as a matter of law on the issues presented. Tex.R.Civ.P.
166a©; Lear Siegler, Inc. v. Perez, 819 S.W.2d 470, 471 (Tex. 1991). In deciding whether there are
disputed material fact issues precluding summary judgment, evidence favorable to the Association
(the non-moving party) must be taken as true. E7 Chico Corp. v. Poole, 732 S.W.2d 306, 315 (Tex.
1987); Cowden v. Bell, 157 Tex. 44, 46, 300 S.W.2d 286, 287 (Tex 1957). Every reasonable
inference from the evidence must be indulged in favor of the Association (the non-moving party) and
any doubts resolved in its favor. Hudnall v. Tyler Bank and Trust Co., 458 S.W. 2d 183, 185 (Tex.
1970). Montgomery v. Kennedy, 669 S.W.2d 309, 311 (Tex. 1984). The burden of proof is on the
Intervenor. Cathey v. Booth, 900 S.W.2d 339 (Tex. 1995). As has been shown above, the Intervenor
has failed to meet its burden and its motion for partial summary judgment should be denied.
40. The Association does not need to introduce any summary judgment evidence unless and until
the Intervenor has first met its summary judgment burden described above. If and when the
Intervenor has established (by competent summary judgment evidence) that there are no disputed
issues of material fact and that it is entitled to judgment as a matter of law (Tex.R.Civ.P. 166a©),
then the burden shifts to the Association to introduce summary judgment evidence sufficient to raise
a fact issue. Cloys v. Turbin, 608 S.W.2d 697 (Tex.App.—Dallas 1980, no writ). In the Cloys case,
the Court of Appeals explained the shifting summary judgment burden as follows:
However, the burden of introducing evidence to avoid summary judgment in
this situation shifts to the non-movant only if the movant’s evidence meets
the criteria of rule 166-A(c) and negates all genuine issues of material fact
with respect to an essential element of the non-movant’s cause of action.
Combs v. Fantastic Homes, Inc., 584 S.W.2d 340, 3244
(Tex.Civ.App.—Dallas 1979, writ ref’d n.r.e.). Further, the controverting
summary judgment evidence introduced by the non-movant_need_ only be
sufficient to raise an issue of fact with respect to the element or elements
negated by the movant’s summary judgment evidence; it need not be
sufficient to meet the burden of persuasion that the non-movant plaintiff
18would have at trial. See Tigner v. First National Bank of Angleton, 153 Tex.
69, 74, 264 S.W.2d 85, 87 (1954). (Emphasis added.)
41. Here, the Intervenor has failed to meet its summary judgment burden and its motion for
summary judgment should be denied. Moreover, the Association has submitted substantial summary
judgment evidence (most of it undisputed) which shows that the Intervenor’s allegations are false,
that at best fact issues exist, and in any event the Intervenor’s motion for partial summary judgment
should be denied.
X.
CONCLUSION AND PRAYER
42. The Intervenor’s motion for partial summary judgment on breach of contract claim should
be denied on numerous grounds. The Intervenor has failed to carry its initial and mandatory burden
under Rule 166a (TRCP) by failing to submit any competent summary judgment evidence in support
of its motion. The Association prays that their hearsay and other objections to Intervenor’s
inadmissable evidence be granted.
43. Furthermore, the Association has shown by summary judgment affidavit that the meeting
which occurred on October 3, 2017 was improper, invalid and a violation of the Bylaws of the
Association and the Texas Property Code.
44, For these reasons, THE PINE CONDOMINIUM ASSOCIATION, INC., respectfully requests
that the Intervenor’s motion for partial summary judgment as to breach of contract be denied and
grant the Association such other and further relief to which the Association may show themselves
to be justly entitled.
19RESPECTFULLY SUBMI
. of
‘tate Bar No. 11106600
mkatine@lawkn.com
LATOYA “TJ” JARRETT, Of Counsel
State Bar No. 24073021
1834 Southmore Blvd
Houston, Texas 77004
Telephone: (713) 808-1000
Telecopier: (713) 808-1107
ATTORNEY FOR INTERVENOR
DEFENDANT THE PINE CONDOMINIUM
ASSOCIATION, INC. (Association)
CERTIFICATE OF SERVICE
I do hereby certify that on this the FI day of OC , 2018, in
accordance with the Texas Rules of Civil Procedure, a true and correct copy of the foregoing
instrument has been forwarded to:
ESERVE
Robert C. E. Wolfe
Law Office of Robert C.E. Wolfe, P.C.
7001 Corporate Drive, Suite 216
Houston, Texas 77036
Telephone: 713.225.5244
Fax: 1-855.329.7239
texaslawhelp@yahoo.com
Attorneys for Plaintiff
ESERVE
Travis Owens
Owens Law Group, P.L.L.C.
414 W Phillips Street, Suite 105
Conroe, Texas 77301
P.O. Box 8605
The Woodlands, Texas 77387
Telephone: 936.828.3583
Fax: 832.327.9187
travis@owens-lawgroup.com
Attorney for Action Premier Hauling,.LLC
MYPCHELL KATINE
20