Eix, Inc. v. JP Morgan Chase Bank (Tex.App.- Houston [14th Dist.] Feb. 19, 2009)(Boyce)
(commercial debt suit, personal guaranty, summary judgment evidence, affidavit by interested witness)
AFFIRMED: Opinion by Justice Boyce
Before Justices Frost, Brown and Boyce
14-08-00042-CV Eix, Inc., and Saeed Moradi v. JP Morgan Chase Bank, N.A.
Appeal from Co Civil Ct at Law No 3 of Harris County
Trial Court Judge: Linda Storey
M E M O R A N D U M O P I N I O N
Appellants Eix, Inc., and Saeed Moradi appeal from a summary judgment in favor of appellee, JP
Morgan Chase Bank, N.A. (“Chase"), in connection with Chase's debt collection lawsuit. Eix and
Moradi contend that the trial court erred by (1) considering inaccurate and misleading summary
judgment evidence; and (2) granting Chase's summary judgment motion. We affirm.
Background
Chase sued Eix and Moradi in Harris County Civil Court at Law No. 3 on February 3, 2006. Chase
alleged that Eix executed and delivered to Chase a revolving credit agreement with Chase on or about
October 20, 1998, and that Moradi personally guaranteed repayment. Chase further alleged that Eix
and Moradi failed to make payments under the revolving credit agreement and failed to pay off the
debt when Chase notified them of their default and demanded payment in full. Eix and Moradi filed an
answer denying Chase's allegations on March 6, 2006.
Chase filed two conventional motions for summary judgment pursuant to Texas Rule of Civil Procedure
166a(a) on March 21, 2006, and November 7, 2006. The trial court denied both motions.
Chase filed a third summary judgment motion under Rule 166a(a) on September 17, 2007. This
motion was supported by an affidavit from Christine Betz, assistant vice-president of Chase. Betz's
affidavit was accompanied by a sworn copy of a “Business Unsecured Revolving Credit Application
for up to $100,000" signed by Moradi on October 16, 1998 on behalf of Eix in his capacity as
president and secretary. Moradi also signed in his individual capacity and dated a portion of the
application entitled “Personal Guaranty."
Betz's affidavit identified her as an assistant vice-president of Chase authorized to make an affidavit
on Chase's behalf. Betz stated in her affidavit that, on or about October 20, 1998, Eix executed and
delivered to Chase a “Business Revolving Credit Application and Agreement" in the original amount of
$50,000, and that Moradi signed a personal guaranty for sums borrowed under the agreement. The
affidavit stated that Eix and Moradi had defaulted in payment of the amounts owed under the
agreement; Chase was the legal owner and holder of the debt; and Chase had sustained damages of
$44,817.54 through May 4, 2007, itemized as (1) $42,821.58 for the unpaid balance; (2) $1,590.29 for
the unpaid accrued interest; (3) $405.67 for fees and charges; and (4) per diem interest of $10.40.
Chase's third summary judgment motion was set for submission on October 12, 2007. Eix and Moradi
filed a late response on October 10, 2007, in which they objected to Betz's affidavit and the
accompanying application. Eix and Moradi simultaneously filed a motion for leave to file a late
response to Chase's third summary judgment motion. The record contains no order from the trial court
addressing the motion for leave to file a late response.
The trial court signed an order granting Chase's third summary judgment motion on October 23, 2007.
Eix and Moradi appeal from this order.
Standard of Review
We review a trial court's grant of summary judgment de novo. Valence Operating Co. v. Dorsett, 164
S.W.3d 656, 661 (Tex. 2005).
The affidavit of an interested witness may support summary judgment if the evidence is clear, positive,
direct, otherwise credible and free from contradictions and inconsistencies, and could have been
readily controverted. See Perez v. Cueto, 908 S.W.2d 29, 31 (Tex. App.- Houston [14th Dist.] 1995,
no writ). “Could have been readily controverted" means that if the testimony is of a nature which can
be effectively countered by opposing evidence - such as facts subject to observation - then summary
judgment is proper in the absence of controverting proof. See id. at 32; Casso v. Brand, 776 S.W.2d
551, 558 (Tex. 1989). Issues such as an actor's intent or knowledge are the types of matters that
cannot be readily controverted. See Perez, 908 S.W.2d at 32.
Once a movant has established a right to summary judgment, the non-movant has the burden to
respond and present to the trial court evidence that would preclude summary judgment. See Barbouti
v. Hearst Corp., 927 S.W.2d 37, 64 (Tex. App.- Houston [1st Dist.] 1996, writ denied).
Except with leave of the trial court, a non-movant must file any written response and opposing affidavits
no later than seven days before the day of submission. See Tex. R. Civ. P. 166a(c). If a trial court
grants leave to file a late response to a summary judgment motion, it must affirmatively indicate in the
record acceptance of the late filing. INA of Tex. v. Bryant, 686 S.W.2d 614, 615 (Tex. 1985). If nothing
in the record indicates that leave was granted, we must presume that the trial court did not consider
the late-filed response and we cannot consider it. Id.
Analysis
Eix and Moradi contend on appeal that the trial court (1) abused its discretion by allowing Chase to
present inaccurate and misleading summary judgment evidence; and (2) erred in granting Chase's
third summary judgment motion because Chase failed to establish entitlement to summary judgment
as a matter of law.
I. Assertedly Defective Summary Judgment Evidence
Before we can address any asserted defects in Chase's evidence supporting its third summary
judgment motion, we first must decide whether Eix and Moradi waived their objections to such
defects.
Defects in the form of affidavits or attachments offered as summary judgment evidence - rather than
defects in substance - are not grounds for reversal unless the complaining party obtains a ruling from
the trial court on its objection. See Rogers v. Continental Airlines, Inc., 41 S.W.3d 196, 200 (Tex. App.
- Houston [14th Dist.] 2001, no pet.); Hicks v. Humble Oil & Ref. Co., 970 S.W.2d 90, 93 (Tex. App.-
Houston [14th Dist.] 1998, pet. denied); see also Tex. R. Civ. P. 166a(f).
Eix and Moradi asserted objections to Chase's summary judgment evidence but did not obtain a ruling
from the trial court. Therefore, Eix and Moradi waived all objections to the form of the summary
judgment evidence. See Rogers, 41 S.W.3d at 200; Hicks, 970 S.W.2d at 93.
We therefore examine the objections that Eix and Moradi assert on appeal to determine whether they
are objections to form or substance. Under their first issue, Eix and Moradi assert that the trial court
erred in overruling their objection to the document attached to Betz's affidavit on the grounds that Betz
inaccurately states that the attached document was in the original amount of $50,000 while the
document does not state an original amount of $50,000. In addition, Eix and Moradi assert that Betz's
affidavit is unreliable because she incorrectly states that the title of the attached document is
“Business Revolving Credit Application and Agreement." Eix and Moradi further complain that Betz's
testimony as an interested witness could not have been readily controverted. See Tex. R. Civ. P. 166a
(c). All of these objections are objections to form rather than substance, and thus Eix and Moradi
waived these objections by failing to obtain a ruling on them from the trial court.[1] See Blancett v.
Lagniappe Ventures, Inc., 177 S.W.3d 584, 589 (Tex. App.- Houston [1st Dist.] 2005, no pet.); Rogers,
41 S.W.3d at 200; Hicks, 970 S.W.2d at 93.
We overrule Eix's and Moradi's issue regarding asserted defects in Chase's summary judgment
evidence.
II. Propriety of Granting Summary Judgment
In their second issue, Eix and Moradi assert that the trial court erred in granting Chase's third summary
judgment motion because Chase failed to establish entitlement to summary judgment as a matter of
law. Eix and Moradi contend that Chase's summary judgment evidence failed to establish (1) that a
contract existed between Chase and Eix and Moradi; (2) the existence and amount of a debt owed by
Eix and Moradi to Chase; and (3) that Moradi had any personal liability as guarantor.
A plaintiff may establish status as legal holder and owner of a debt obligation by attesting to such
status in a sworn affidavit. See Blankenship v. Robins, 899 S.W.2d 236, 238 (Tex. App.- Houston
[14th Dist.] 1994, no writ). A plaintiff may establish that a certain balance is due and owing on a debt
obligation by stating this fact in a sworn affidavit. Id. at 238-39.
Betz stated in her affidavit that (1) Eix executed and delivered a “Business Revolving Credit
Application and Agreement" in the original amount of $50,000 on or about October 20, 1998; (2) the
agreement included language whereby Moradi personally guaranteed repayment; (3) the agreement
provided for Eix and Moradi to make payments of all principal and interest; (4) the complete terms of
the agreement are described in the document attached to Betz's affidavit; (5) Eix and Moradi failed to
abide by the terms of the agreement by failing and refusing to make payments as required under the
terms of the agreement after receiving a demand from Chase; (6) Eix and Moradi were notified by
Chase of such default and payment was demanded, but Eix and Moradi failed to cure their default; (7)
Chase is the legal owner and holder of the agreement and guaranty; (8) the unpaid principal under the
agreement as of May 4, 2007 was $42,821.58; (9) the total amount owed as of May 4, 2007 including
pre-judgment interest was $44,817.54; and (10) each day after May 4, 2007, $10.40 more in
additional interest will accrue. The trial court granted summary judgment to Chase for the amount
specified in Betz's affidavit, as well as for attorneys' fees found in the attorneys' fees affidavit
submitted by Chase.
Eix and Moradi filed an untimely response to Chase's motion. See Tex. R. Civ. P. 166a(c). They did
not obtain leave to file a late response. See Bryant, 686 S.W.2d at 615. However, even if they had
obtained leave, their response did not contain any summary judgment evidence to preclude summary
judgment if Chase established entitlement to summary judgment as a matter of law. See Barbouti,
927 S.W.2d at 64.
After reviewing Chase's summary judgment evidence under the applicable de novo standard, we
conclude this evidence establishes as a matter of law that (1) a contract existed between Chase and
Eix and Moradi; (2) Eix and Moradi owe a debt to Chase in the amounts stated in Betz's affidavit; and
(3) Moradi had personal liability for this debt based on his personal guaranty. See Perez, 908 S.W.2d
at 31-32; Blankenship, 899 S.W.2d at 238-39; Casso, 776 S.W.2d at 558.
We overrule Eix's and Moradi's issue regarding the propriety of the trial court's grant of Chase's third
summary judgment motion.
Conclusion
The trial court's grant of summary judgment is affirmed.
/s/ William J. Boyce
Justice
Panel consists of Justices Frost, Brown, and Boyce.
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1 Under their first issue, Eix and Moradi make passing reference to the asserted insufficiency of Chase's
summary judgment evidence to support the trial court's granting of Chase's motion. These statements do not
relate to evidentiary objections. The sufficiency of Chase's summary judgment evidence is addressed in Part II
of this opinion.