Motion for Summary Judgment in Zion Builders Limited Liability Company d/b/a Zion Builders VS. Eric Garduno a/k/a Eric Garduno and Karen Garduno| Trellis.Law

On May 01, 2019 a Motion,Ex Parte was filed involving a dispute between Zion Builders Limited Liability Company D B A Zion Builders, and Eric Garduno A K A Eric Garduno, Garduno, Karen, for Other Civil Case >$100,000 but <$200,000 in the District Court of Montgomery County.

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Received and E-Filed for Record
4/9/2021 11:44 AM
Melisa Miller, District Clerk
Montgomery County, Texas
Deputy Clerk, Kayla Adams

CAUSE NO. 19-05-06051

ZION BUILDERS LIMITED § IN THE DISTRICT COURT OF
LIABILITY COMPANY D/B/A ZION §
BUILDERS §
Plaintiff, Counter-Defendant §
§
V. § MONTGOMERY COUNTY, TEXAS
§
ERIK GARDUNO A/K/A ERIC §
GARDUNO AND KAREN GARDUNO §
Defendants, Counter-Plaintiffs. § 457th JUDICIAL DISTRICT

COUNTER-PLAINTIFFS ERIK GARDUNO AND KAREN GARDUNO’S
MOTION FOR PARTIAL SUMMARY JUDGMENT

COMES NOW, Counter-Plaintiffs Erik Garduno and Karen Garduno (collectively

“Counter-Plaintiffs” or “Gardunos”), and files this their Motion for Partial Summary Judgment as

to Counter-Defendants Zion Builders Limited Liability Company d/b/a Zion Builders’ (“Zion”)

and Tyler Logeman’s (“Logeman”), (collectively “Counter-Defendants”), liability for breach of

contract, breach of both express and implied warranties, violations of the Texas Deceptive Trade

Practices Act, fraud, and fraud in a real estate transaction, and in support hereof would respectfully

show the Court the following:

I. SUMMARY JUDGMENT EVIDENCE

1. In support of their Motion for Partial Summary Judgment, the Gardunos attach the

following items as Exhibits A through M and hereby incorporate all into this Motion by reference.

EXHIBIT A: Declaration of Karen Garduno;

EXHIBIT A-1: Closing Disclosures;

EXHIBIT A-2: Email dated February 1, 2018;

EXHIBIT A-3: Email dated September 18, 2018;

EXHIBIT A-4: Email Chain;
EXHIBIT A-5: Email dated October 8, 2018 with attached Change Order;

EXHIBIT A-6: Email dated October 9, 2018 with attached Change Order;

EXHIBIT A-7: Email dated October 10, 2018 with attached Change Order;

EXHIBIT A-8: Disbursement Authorization dated October 19, 2018;

EXHIBIT A-9: Email dated November 27, 2018 with attached Spreadsheet;

EXHIBIT A-10: Text Message;

EXHIBIT A-11: Text Message;

EXHIBIT A-12: Check dated December 10, 2018;

EXHIBIT A-13: Text Message;

EXHIBIT A-14: Text Message;

EXHIBIT A-15: Text Message;

EXHIBIT A-16: Letter dated February 13, 2019;

EXHIBIT B: Residential Construction Agreement;

EXHIBIT C: Celina Cereceres Deposition dated June 29, 2020;

EXHIBIT D: Celina Cereceres Expert Report;

EXHIBIT E: HOA Application;

EXHIBIT F: Change Order Confirmation Agreement, dated November 9, 2018;

EXHIBIT G: Construction Loan Draw Summaries;

EXHIBIT H: Zion’s Transaction Detail by Account dated April 23, 2019;

EXHIBIT I: Zion’s Objections and Responses to the Gardunos’ First Set of
Discovery Requests;

EXHIBIT J: Erik Garduno Deposition dated June 23, 2020;

EXHIBIT K: Declaration of Frank Jones;

EXHIBIT L: Email dated August 2, 2017;

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EXHIBIT M: Zion’s Certificate of Formation.

The Gardunos respectfully refer the Court to the attached exhibits in support of this Motion. TEX.

R. EVID. 801e(3); TEX. R. CIV. P. 203.6(b).

II. FACTUAL BACKGROUND

2. On August 21, 2017, the Gardunos entered into a contract with Zion (the

“Contract”) to construct the residential property located in Montgomery County at 28792 Shirley

Court, Magnolia, Texas 77355, more specifically described as Block 1, Lot 20 (the “Home”). See

Ex. B (Residential Construction Agreement); see also Ex. I (Zion’s Resps. to Gardunos’ First Set

Disc. Reqs.), Req. for Admis. Nos. 2, 3.

3. The Contract’s original bid was for $400,000.00, which included a builder’s flat fee

of $60,000.00. See Ex. B, at 1, 5, 6. The Contract was a “cost plus” contract, meaning the Gardunos

were to pay the actual construction costs plus Zion’s builder’s flat fee. See Ex. B.

4. To help finance the construction project, the Gardunos took out a loan with

Brenham National Bank (“Brenham Bank”). See Ex. A (K. Garduno Decl.) ¶5; see also Ex. A-1

(Closing Disclosures). The original amount for the construction loan was $476,517.00, with

$76,517.00 being attributable to the purchase of the land. See Ex. A ¶5; see also Ex. C (C.

Cereceres Dep., June 29, 2020), at 39:02-09. Therefore, $400,000.00 was allocated to fund the

Home’s construction. See Ex. A ¶5; see also Ex. C, at 39:02-09; see also Ex. D (C. Cereceres

Expert Report).

5. Immediately after construction began, the Gardunos began to have problems with

Zion and Logeman. While the roof was being installed, Logeman told the Gardunos the Home was

over budget. See Ex. A ¶6; see also Ex. A-2 (Email dated Feb. 1, 2018). In reliance on Mr.

Logeman’s representations the Gardunos took on additional debt to fund the Home’s construction

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and began to pay for many of the Home’s items themselves. See Ex. A ¶6. Karen Garduno even

went so far as to borrow $20,000.00 from her father to pay for some of the Home’s costs, money

that she was unable to repay before his passing. See Ex. A ¶6.

6. In May of 2018, Mr. Logeman told the Gardunos the Home was actually going to

come in under budget and that he would start taking bids to have a pool installed. See Ex. A ¶7.

Relying on this representation, the Gardunos went through their Homeowners Association

(“HOA”) to get approval for pool installation and got the pool plans approved. See Ex. E (HOA

Application). Subsequently, Logeman backed out of the pool installation, stating that he was afraid

it would cause budget overages. See Ex. A ¶7; see also Ex. A-3 (Email dated Sept. 18, 2018).

7. On September 30, 2018 and October 1, 2018, Mr. Logeman emailed the Gardunos

advising them to increase their loan by $50,000.00 so that they could close out by October 19. See

Ex. A; see also Ex. A-4 (Email Chain). On October 8, 2018, Mr. Logeman sent the Gardunos an

email attaching a change order for $70,000.00, which he lowered to $50,000.00 without support.

See Ex. A; see also Ex. A-5 (Email dated Oct. 8, 2018); see also Ex. A-6 (Email dated Oct. 9,

2018); see also Ex. C, at 23:23 – 24:04. Mr. Logeman assured the Gardunos that he would make

a draw for the increased loan funds but instead of using it to build a pool, Mr. Logeman would pay

these funds to the Gardunos at closing so the Gardunos could install a pool later. See Ex. A ¶8.

Mr. Logeman stated that at the Home’s closing he would sign over the balance he owes the

Gardunos, telling the Gardunos that this was a common practice in the industry and to trust him.

See id. ¶8. The Gardunos, again believing Logeman and in reliance on his representations,

executed and submitted the $50,000.00 change order to Brenham Bank, increasing their loan

amount to $450,000.00. See Ex. A; see also Ex. A-7 (Email dated Oct. 10, 2018); see also Ex. A-

1; see also Ex. F (Change Order Confirmation Agreement, dated Nov. 9, 2018).

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8. Over the course of construction, Zion made draws on the construction loan in order

to pay for the work it allegedly completed. See Ex. G (Construction Loan Draw Summaries). On

October 19, 2018, for the final draw request, Mr. Logeman, as owner and manager of Zion, signed

a Conditional Waiver and Release on Final Payment covering the final payment to Zion for all

labor services, equipment, or materials furnished to the Home. See Ex. A; see also Ex. A-8

(Disbursement Authorization dated Oct. 19, 2018), at 3.

9. Based on Zion’s disbursement requests and lien waiver, Brenham Bank distributed

the entire amount of the Gardunos’ construction loan, $450,000.00, to Zion. See Ex. H (Zion’s

Transaction Detail by Account dated Apr. 23, 2019); see also Ex. C, at 52:17 – 53:01; see also Ex.

A; see also Ex. A-8, at 2.

10. On November 9, 2018, the Gardunos closed on their Home, converting their loan

with Brenham Bank into a mortgage. See Ex. A; see also Ex. A-1. That same day, the parties

executed a Change Order Confirmation Agreement to reflect the additional $50,000.00 for the

change order. See Ex. F. Despite Mr. Logeman’s assurances to pay the Gardunos the excess

construction funds, he did not sign over the balance owed to the Gardunos. See Ex. A ¶9. In fact,

Mr. Logeman was not even present at the scheduled closing of the Home. See id. Rather, Logeman

decided to appear earlier than scheduled to execute his portion of the closing documents, the

Change Order Confirmation Agreement, and the Waiver and Release of Lien, completely avoiding

the Gardunos altogether. See id.

A. Defects in Construction

11. Under the Contract, Zion warranted that “the construction methods, techniques,

sequences, and procedures, employed by subcontractors in the performance of their duties shall be

performed in a workmanlike manner, and in accordance with the plans and specifications.” See

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Ex. B ¶5. In November of 2018, after Zion made the final construction draw, the Gardunos moved

into the Home. See Ex. A ¶10. However, upon occupying the Home, the Gardunos discovered a

litany of problems with Zion’s work as its construction failed to conform to the plans and

specifications of the Home, including, but not limited to:

• The Home’s concrete driveway is improperly laid and has cracks throughout, which
causes repeated water pooling. See Ex. J (E. Garduno Dep., June 23, 2020), at 126:01-
03; 159:18 – 160:02.

• The grading near the driveway and garage door allows water to flood the driveway,
including to a level that water enters the garage See id., at 73:04 – 75:24.

• The sidewalk leading up to the Home’s front door is higher in elevation than the
Home’s level causing water to pond between the Home and the walkway. See id., at
76:25 – 77:08, 78:02-08.

• The lack of grading near the septic tank causes the area to consistently flood. See Ex.
A ¶10; see also Ex. K (F. Jones Declaration).

• The custom-made iron front door frame is installed improperly, causing the door to
scratch the wood flooring anytime it is opened or closed. See Ex. J, at 162:17 – 163:05
see also Ex. K.

• The custom-made iron back door frame is also improperly installed. See id., at 161:21
– 162:04.

• The bamboo hard wood floors are installed incorrectly and have cupping due to
excessive moisture on the floor or lack of proper moisture proofing. The flooring is
wedged upwards and buckles in places throughout the Home, most noticeably near the
front door. See Ex. A ¶10; see also Ex. K.

• The garage door opener was installed incorrectly with the left door control opening the
right door and vice versa. See Ex. A ¶10; see also See Ex. J, at 165:03-06.

• The rear patio’s gas fireplace does not work because the gas was never hooked up. See
Ex. J, at 190:25 – 191:07.

12. Moreover, Zion hired a subcontractor to install the HVAC unit but failed to hire a

plumber to finish out the gas and heat lines. See Ex. J, at 165:07 – 166:04. Zion also caused damage

to the ceiling of the Gardunos’ children’s bathroom which has not been repaired and the tiles in

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the master bath and children’s bathroom were not laid properly or according to the plans submitted

by the Gardunos’ interior designer. See Ex. A ¶10; see also Ex. K. Furthermore, the cabinets in the

kitchen remain uneven, with some being broken or split and needing replacement. See Ex. A ¶10;

see also Ex. A-12.

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18. On February 13, 2019, Counter-Plaintiffs sent Counter-Defendants a demand letter

outlining the construction defects and problems with overages in Counter-Defendants accounting

as statutorily required by the Texas Deceptive Trade Practice Act and the Residential Construction

Liability Act. See Ex. A; see also Ex. A-16 (Letter dated Feb. 13, 2019). Counter-Defendants have

failed to make a written offer of settlement within 45 days of receiving Counter-Plaintiffs’ demand

and have not offered to make repairs.

III. SUMMARY JUDGMENT STANDARD

19. A party seeking to recover upon a claim may move for summary judgment any time

after the adverse party has answered. TEX. R. CIV. P. 166a(a). Under Rule 166a(c) of the Texas

Rules of Civil Procedure, summary judgment is proper if the movant demonstrates that no genuine

issue of material fact exists and that it is entitled to judgment as a matter of law. Randall’s Food

Markets, Inc. v. Johnson, 891 S.W.2d 640, 644 (Tex. 1995); Houston v. Clear Creek Basin

Authority, 589 S.W.2d 671 (Tex. 1979). The Court must grant a motion for summary judgment if

the moving party meets it burden of showing that there is no genuine of issue of material fact and

it is entitled to summary judgment as a matter of law. TEX. R. CIV. P.166(a)(c); Provident Life &

Acc. Ins. Co. v. Knott, 128 S.W.3d 211, 215 (Tex. 2005); Phillips v. Union Bankers Ins. Co., 812

S.W.2d 616, 617 (Tex. App.—Dallas 1991, no pet.).

IV. ARGUMENTS AND AUTHORITIES

A. Zion is Liable for Breach of Contract.

20. There is no genuine issue of material fact that Zion is liable for breach of the

Contract. To prevail on a claim for breach of contract, a plaintiff must establish the following

elements: (1) the existence of a valid contract, (2) performance or tendered performance by the

plaintiff, (3) breach of the contract by the defendant, and (4) damages sustained by the plaintiff as

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a result of the breach. See S. Elec. Servs., Inc. v. City of Houston, 355 S.W.3d 319, 323-24 (Tex.

App.—Houston [1st Dist.] 2011, pet. denied).

1. Zion and the Gardunos Executed a Valid and Enforceable Written Contract.

21. It is undisputed that on August 21, 2017, the Gardunos and Zion entered into a valid

and enforceable residential construction agreement for Zion to construct the residential property

located in Montgomery County at 28792 Shirley Court, Magnolia, Texas 77355, more specifically

described as Block 1, Lot 20. See Ex. B; see also Ex. I, Req. for Admis. Nos. 2, 3.

2. The Gardunos Performed Their Contractual Obligations.

22. To prove performance or tendered performance of contractual obligations, a

plaintiff must demonstrate that he complied with the contract’s provisions. M7 Capital LLC v.

Miller, 312 S.W.3d 214, 222 (Tex. App.—Houston [14th Dist.] 2010, pet. denied). Here, the

evidence conclusively establishes that the Gardunos complied with their obligations under the

Contract. Under the Contract, the Gardunos agreed to pay the actual construction costs plus Zion’s

builder’s flat fee. See Ex. B.

23. Over the course of construction, Zion made draws on the construction loan in order

to pay for the work it allegedly completed. See Ex. G. On October 19, 2018, for the final draw

request, Mr. Logeman, as owner and manager of Zion, signed a Conditional Waiver and Release

on Final Payment covering the final payment to Zion for all labor services, equipment, or materials

furnished to the Home. See Ex. A; see also Ex. A-8, at 3. Based on Zion’s disbursement requests

and lien waiver, Brenham Bank distributed the entire amount of the Gardunos’ construction loan,

$450,000.00, to Zion. See Ex. H; see also Ex. C, at 52:17 – 53:01; see also Ex. A; see also Ex. A-

8, at 2.

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24. The summary judgment evidence establishes that not only did the Gardunos pay

the actual construction costs plus Zion’s builder’s flat fee, but that Zion was grossly overpaid,

receiving funds it was not entitled to under the Contract.

3. Zion Breached the Contract.

25. Zion breached the Contract by failing to construct the Home in conformance with

the Home’s plans and specifications as well as failing to oversee and supervise the Home’s

construction.

26. A breach of contract occurs when a party to the contract fails or refuses to do

something that it has promised to do. B & W Supply, Inc. v. Beckman, 305 S.W.3d 10, 16 (Tex.

App.—Houston [1st Dist.] 2009, pet. denied). Under the Contract, Zion agreed to “supervise and

obtain the performance of all work necessary to complete the plans and specifications” as well as

“furnish efficient business administration and supervision”. See Ex. B ¶1. Zion also agreed to be

“in charge of all construction and shall be solely responsible for the management and control of

all subcontractors and their work.” See id. ¶12.

27. Zion breached the Contract by failing to conform to the plans and specifications

during the Home’s construction. See Ex. B ¶1; see also Ex. K. Upon occupying the Home, the

Gardunos discovered a litany of problems with Zion’s work because it did not conform to the plans

and specifications of the Home. See supra ¶¶12-13; see also Ex. A ¶10; see also Ex. J, at 73:04 –

75:24, 76:25 – 77:08, 78:02-08, 126:01-03, 159:18 – 160:02, 161:21 – 162:04, 162:17 – 163:05,

165:03– 166:04, 190:25 – 191:07; see also Ex. K.

28. Counter-Defendant Zion further breached the Contract by failing to oversee and

supervise the Home’s construction. See Ex. B ¶¶1, 12; see also Ex. A ¶12; see also Ex. A-13; see

also Ex. A-14; see also Ex. A-15. Despite agreeing to supervise and obtain the performance of all

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work necessary to complete the plans and specifications of the Contract, Counter-Defendants were

mostly not present during the Home’s construction. See Ex. A ¶12; see also Ex. A-13. Meanwhile,

the Gardunos and their parents were forced to take time out of their schedule to supervise the work

being done on the Home that should have been supervised by Counter-Defendants. See Ex. A; see

also Ex. A-14; see also Ex. A-15.

29. The summary judgment evidence conclusively and unequivocally establishes there

is no genuine issue of material fact regarding Zion’s breach of the Contract it had with the

Gardunos. Accordingly, the Court should find as a matter of law that Zion breached its contract

with the Gardunos and grant the Gardunos summary judgment on their breach of contract claim.

B. Zion is Liable for Breach of Express Warranty.

30. The Gardunos are entitled to summary judgment on their breach of express

warranty cause of action because there is no genuine issue of material fact that Zion breached the

express warranty it made in the Contract.

31. To prevail on a claim for breach of express warranty, the Gardunos must establish:

(1) the defendant sold services to the plaintiff; (2) the defendant made a representation to the

plaintiff about the characteristics of the services by affirmation of fact, by promise, or by

description; (3) the representation became part of the basis of the bargain; (4) the defendant

breached the warranty; (5) the plaintiff notified the defendant of the breach, if required by the

parties’ agreement; and (6) the plaintiff suffered injury. Southwestern Bell Tel. Co. v. FDP Corp.,

811 S.W.2d 572, 576-77 & n.3 (Tex. 1991); see Paragon Gen. Contractors, Inc. v. Larco Constr.,

Inc., 227 S.W.3d 876, 886 (Tex. App.—Dallas 2007, no pet.). If a representation is made during

the bargain, there is a rebuttable presumption that an express representation becomes the basis for

12
the bargain. See e.g., TEX. BUS. & COM. CODE § 2.313 cmt. 3; Crosbyton Seed Co. v. Mechura

Farms, 875 S.W.2d 353, 361 (Tex. App.—Corpus Christi 1994, no writ.).

32. Here, the Gardunos and Zion entered into a valid and enforceable residential

construction contract whereby Zion agreed to provide construction services to the Gardunos and

expressly warranted that the Home would be constructed in substantial conformity with the plans

and specifications provided in the Contract. See Ex. B. Specifically, Zion warranted that “the

construction methods, techniques, sequences, and procedures, employed by subcontractors in the

performance of their duties shall be performed in a workmanlike manner, and in accordance

with the plans and specifications.” See Ex. B ¶5 (emphasis added).

33. Zion’s express warranty became part of the basis of the bargain as it was an express

provision of the Contract. See Paragon Gen. Contractors, 227 S.W.3d at 886 (“The

representation's presence in the contracts shows it was part of the basis of the bargain.”); see e.g.,

TEX. BUS. & COM. CODE § 2.313 cmt. 3. Additionally, Zion’s express warranty was part of the

basis of the bargain because the Gardunos relied on Zion’s representations when they entered into

the Contract and throughout the construction of the Home. Specifically, if the Gardunos had not

been misled by Counter-Defendants about the quality and workmanship of their work, the

Gardunos would have never agreed to enter into a contract with Counter-Defendants and would

have never agreed to continue paying Counter-Defendants for this poor/defective work. See Ex. A

¶12.

34. Furthermore, there is ample evidence that the Home was not constructed in

substantial conformity with the plans and specifications provided in the Contract. Upon occupying

the Home, the Gardunos discovered a litany of problems with Zion’s work as its construction failed

to conform to the plans and specifications of the Home, including, but not limited to:

13
• The Home’s concrete driveway is improperly laid and has cracks throughout, which
causes repeated water pooling. See Ex. J, at 126:01-03; 159:18 – 160:02.

• The grading near the driveway and garage door allows water to flood the driveway,
including to a level that water enters the garage See id., at 73:04 – 75:24.

• The sidewalk leading up to the Home’s front door is higher in elevation than the
Home’s level causing water to pond between the Home and the walkway. See id., at
76:25 – 77:08, 78:02-08.

• The lack of grading near the septic tank causes the area to consistently flood. See Ex.
A ¶10; see also Ex. K.

• The custom-made iron front door frame is installed improperly, causing the door to
scratch the wood flooring anytime it is opened or closed. See Ex. J, at 162:17 – 163:05.

• The custom-made iron back door frame is also improperly installed. See id., at 161:21
– 162:04.

• The garage door opener was installed incorrectly with the left door control opening the
right door and vice versa. See Ex. A ¶10; see also See Ex. J, at 165:03-06.

• The rear patio’s gas fireplace does not work because the gas was never hooked up. See
Ex. J, at 190:25 – 191:07.

Zion also caused damage to the ceiling of the Gardunos’ children’s bathroom which has not been

repaired and the tiles in the master bath and children’s bathroom were not laid properly or

according to the plans submitted by the Gardunos’ interior designer. See Ex. A ¶10; see also Ex.

K. Additionally, the cabinets in the kitchen remain uneven, with some being broken or split and

need to be replaced. See Ex. A ¶10; see also Ex. K. Zion breached its express warranty by failing

to construct the Home in substantial conformity with the Home’s plans and specifications and

failing to ensure that subcontractors performed their duties in a workmanlike manner.

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35. On February 13, 2019, the Gardunos sent Counter-Defendants a demand letter

notifying Counter-Defendants of the construction defects and problems with overages in Counter-

Defendants’ accounting. See Ex. A; see also Ex. A-16.

36. All competent summary judgment evidence establishes Zion breached its express

warranty to the Gardunos. Reasonable minds cannot differ in reaching this conclusion. The Court

should enter judgment as a matter of law as to Zion’s liability for breach of an express warranty.

C. Logeman and Zion are Liable for Violations of the Texas Deceptive Trade Practices Act.

37. Logeman and Zion engaged in false, misleading, and deceptive acts, practices

and/or omissions, and committed unconscionable actions, which violated the Texas Deceptive

Trade Practices Act (“DTPA”). Logeman and Zion’s breach of the implied warranty of good and

workmanlike performance, as well as Logeman representing that his services have characteristics

which they do not have, taking advantage of the Gardunos’ lack of lack of knowledge, ability,

experience, or capacity, and Logeman’s misrepresentations regarding the Home’s construction and

its cost, all violate the DTPA.

38. A plaintiff proves a cause of action under the DTPA by showing the following: (1)

the plaintiff is a consumer; (2) the defendant can be sued under the DTPA; (3) the defendant

committed one or more of the following wrongful acts: (a) a false, misleading, or deceptive act or

practice that is specifically enumerated in the “laundry list” found in TEX. BUS. & COM. CODE §

17.46(b) and that was relied on by the plaintiff to the plaintiff’s detriment, (b) a breach of an

express or implied warranty, or (c) any unconscionable action or course of action by any person;

and (4) the defendant’s actions were the producing cause of the plaintiff’s damages. See TEX. BUS.

& COM. CODE §§ 17.45, 17.46, 17.50. Amstadt v. U.S. Brass Corp., 919 S.W.2d 644, 649 (Tex.

1996).

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1. The Gardunos are Consumers.

39. A plaintiff in a DTPA action must prove his status as a consumer. Eckman v.

Centennial Savings Bank, 784 S.W.2d 672, 674 (Tex. 1990); Knight v. International Harvester

Credit Corp., 627 S.W.2d 382, 388 (Tex. 1982). In order to prove status as a “consumer” under

the DTPA, a plaintiff must satisfy the following elements: (1) be a person or entity; (2) that sought

or acquired, by purchase or lease, (3) goods or services. TEX. BUS. & COM. CODE § 17.45(4). In

determining the plaintiff’s consumer status, the focus is on the plaintiff’s relationship to the

transaction, not on the plaintiff’s contractual relationship with the defendant. Arthur Andersen &

Co. v. Perry Equip. Corp., 945 S.W.2d 812, 815 (Tex. 1997). Whether a plaintiff is a consumer is

a question of law. Bohls v. Oakes, 75 S.W.3d 473, 479 (Tex. App.—San Antonio 2002, pet.

denied). Here, the Gardunos are consumers under the DTPA because they sought and acquired

goods and services by purchase. Specifically, the Gardunos sought and acquired goods and

services for the construction of the Home from Counter-Defendants.

2. Zion and Logeman are Amenable to Suit under DTPA.

40. The DTPA permits a plaintiff to bring an action against any person who uses or

employs false, misleading, or deceptive acts or practices. TEX. BUS. & COM. CODE §17.50(a)(1).

A “person” is defined as an individual, partnership, corporation, association, or other group

however organized. TEX. BUS. & COM. CODE §17.45(3).

41. Counter-Defendant Zion is a limited liability company organized and existing

under the laws of the state of Texas. See Ex. M (Zion’s Certificate of Formation). Counter-

Defendant Zion is a construction company in the business of constructing residential homes for

consumers. Counter-Defendant Logeman is the owner of Counter-Defendant Zion. See Ex. M.

Both Counter-Defendants qualify as a “person” for purposes of the DTPA.

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3. Zion and Logeman Committed Wrongful Acts, Violating the DTPA.

42. Counter-Defendants committed one or more wrongful acts under the DTPA. To

maintain an action under the DTPA, the plaintiff must prove the defendant committed one or more

of the following wrongful acts: (a) a false, misleading, or deceptive act or practice that is

specifically enumerated in the “laundry list” found in TEX. BUS. & COM. CODE § 17.46(b) and that

was relied on by the plaintiff to the plaintiff’s detriment, (b) a breach of an express or implied

warranty, or (c) any unconscionable action or course of action by any person. See TEX. BUS. &

COM. CODE § 17.50.

a. Zion and Logeman’s Breaches of Warranty Violate the DTPA.

43. The act of building a house defectively, after representing that the house would be

built in a good and workmanlike manner, constitutes a deceptive trade practice. Jim Walter Homes,

Inc. v. Valencia, 690 S.W.2d 239, 242 (Tex. 1985). Similarly, representations or promises of

quality of construction are recognized as express warranties. See The Austin Company v. Vaughn

Building Corporation, 643 S.W.2d 113 (Tex. 1982). Furthermore, the Texas Supreme Court

recognizes that a builder-seller of a new home, as in this case, impliedly warrants that the home is

constructed in a good and workmanlike manner. Melody Home Manufacturing Co. v. Barnes, 741

S.W.2d 349, 353 (Tex. 1987); Evans v. Stiles, Inc., 689 S.W.2d 399 (Tex. 1985); Humber v.

Morton, 426 S.W.2d 554, 562 (Tex. 1968). These warranties cannot be disclaimed in a contract

for the sale of a new home. Buecher v. Centex Homes, 18 S.W.3d 807, 811 (Tex. App.—

San Antonio, pet. filed). Even though a warranty is a part of a sale or lease contract, it is an

independent promise apart from the contractual obligations, and its breach gives rise to a separate

action for damages. See Glockzin v. Rhea, 760 S.W.2d 665, 669 (Tex. App—Houston [1st Dist.]

1988, writ denied) (Hoyt, J., dissenting).

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44. As argued more extensively above, Zion breached the Contract’s express warranty,

as well as the implied warranty that the home would be constructed in a good and workmanlike

manner, by failing to construct the Home in substantial conformity with the Home’s plans and

specifications and failing to ensure that subcontractors performed their duties in a workmanlike

manner. See supra ¶¶30-36. Thus, by failing to perform the work contracted for with good quality,

free of defects and faults, Zion and Logeman breached their express and implied warranties in

violation of the DTPA.

b. Zion and Logeman’s False, Misleading, or Deceptive Acts or Practices.

45. Counter-Defendants engaged in false, misleading, or deceptive acts or practices

specifically enumerated in Texas Business and Commerce Code § 17.46(b), which were

specifically relied upon by Counter-Plaintiffs to their detriment. Specifically, Counter-Defendants:

a. Represented that the express warranty conferred or involved rights or remedies which
it does not have or involve. See TEX. BUS. & COM. CODE § 17.46(b)(20).

b. Represented that Counter-Defendants’ work and services had been performed on the
Home when their work and services were not performed on the Home. See TEX. BUS.
& COM. CODE § 17.46(b)(22). Specifically, Counter-Defendants falsely represented
they performed their services under the Contract and would make draws on the
construction loan in order to pay for the work itallegedly completed. See Ex. C, at
22:01-17, 23:15 – 24:11, 24:21 – 25:02; see also Ex. G. However, during the entire
construction of the Home, the total amount in construction draws exceeded the total
expenses incurred. See Ex. C, at 22:01-17.

c. Represented that Counter-Defendants’ services had sponsorship, approval,
characteristics, or benefits which they did not have by falsely representing their
construction of the Home would be in substantial conformity with the plans and
specifications provided in the Contract. See TEX. BUS. & COM. CODE § 17.46(b)(22);
see also Ex. B.

d. Failed to disclose information concerning Counter-Defendants’ services whi

Case Info

Judge

Santini, Vincenzo J Track Judge’s New Case

Case No.

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Document Filed Date

April 09, 2021

Case Filing Date

May 01, 2019

County

Parties

Christopher L Johnson Attorney for the Defendant
Eric Garduno a/k/a Eric Garduno Defendant
Garduno, Karen Defendant
JOSEPH K WATTS Attorney for the Plaintiff
Pro Se Attorney for the Plaintiff
Zion Builders Limited Liability Company d/b/a Zion Builders Plaintiff
Justin Kornegay Attorneys for Defendants
Caroline Bossier Attorneys for Defendants
Robert Freehill Attorneys for Defendants
Jacqueline Smith Attorneys for Plaintiffs

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Motion,Ex Parte: Zion Builders Limited Liability Company d/b/a Zion Builders VS. Eric Garduno a/k/a Eric Garduno and Karen Garduno

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