Court of Appeals of Texas, Fourth District, San Antonio
the 225th Judicial District Court, Bexar County, Texas Trial
Court No. 2014-CI-11798 The Honorable Barbara Hanson
Nellermoe, Judge Presiding
Sitting: Karen Angelini, Justice, Marialyn Barnard, Justice,
Luz Elena D. Chapa, Justice
Hashmi sued BoRain Capital, LLC for breach of contract.
Although a jury found that Hashmi failed to prove the
existence of an agreement between Hashmi and BoRain, the
trial court granted judgment against BoRain notwithstanding
the jury's verdict. BoRain appealed. We conclude the
trial court erred in granting judgment notwithstanding the
verdict, and therefore, reverse the trial court's
judgment and render judgment that Hashmi take nothing.
and Procedural Background
owned a note in the amount of $122, 400.00 that he wanted to
sell. Hashmi contacted Susan Rogers,
vice president of Chaminade Capital Corporation, who brokered
a deal between Hashmi and Northeastern Capital. Under the
deal, Northeastern would buy the note from Hashmi for $83,
477.00. Hashmi and Northeastern entered into a purchase
agreement. Shortly thereafter, Northeastern entered into a
deal with BoRain for BoRain to buy the note for $93, 283.71.
and West, a firm in San Antonio, Texas, handled the closing.
BoRain and Northeastern each paid as agreed. However, no
documents were prepared to show the transfer of the note from
Hashmi to Northeastern. The closing documents showed only the
transfer of the note from Hashmi to BoRain.
provided West with his bank routing number and account
information via email so that the funds owed him from the
sale could be directly deposited into his account at a local
bank. However, Hashmi's email account was hacked and the
hacker, posing as Hashmi, sent an email to West instructing
it to wire the funds to a bank account in Malaysia. Unaware
that Hashmi's email account had been hacked, West
followed the instructions in the email and wired the funds
from the sale of the note to the bank account in Malaysia,
instead of to Hashmi's local bank account. By the time
the parties realized that Hashmi's email account had been
hacked and the funds diverted, the banks were unable to
reverse the transaction. The hacker made off with the sale
proceeds due to Hashmi.
sued West for breach of fiduciary duty and BoRain for breach
of contract. The case was tried to a jury. In Question No. 4
of the jury charge, the jury was asked, "Did BoRain
Capital, LLC agree to buy Mr. Hashmi's note?" The
jury answered, "No." Because of this finding, the
jury did not answer Question No. 5, which stated, "Did
BoRain Capital, LLC fail to comply with its agreement to pay
Mr. Hashmi for the note in question?" Additionally, the
jury found West failed to comply with its duties as
escrow/closing agent by wiring funds to the wrong account and
attributed one hundred percent of the responsibility for the
harm to West. The jury also made findings regarding the
amount of reasonable attorney's fees.
trial, Hashmi and West reached a high-low settlement
agreement. West ultimately paid Hashmi $81, 500.00 in
accordance with the parties' agreement.
trial, Hashmi moved for judgment notwithstanding the verdict,
asserting there was no evidence that Northeastern was the
seller of the note as argued by BoRain. Hashmi argued that
the evidence conclusively established an implied-in-fact
contract between Hashmi and BoRain. Hashmi further argued
that the evidence conclusively established that West was
BoRain's agent for the delivery of funds to Hashmi and
that, once West diverted the funds to the hacker, BoRain
remained liable to him for the purchase price of the note.
Based on these arguments, Hashmi asserted that the evidence
conclusively established that the answers to Questions 4 and
5 were "Yes."
trial court agreed with Hashmi, granted his motion for
judgment notwithstanding the verdict, and rendered judgment
that Hashmi recover from BoRain the sum of $81, 362.66 plus
prejudgment interest, $41, 101.00 in attorney's fees for
trial, and additional attorney's fees for appeal. The
trial court then reduced the amount of the judgment by $81,
500.00, the amount Hashmi recovered under the settlement
agreement with West. BoRain appeals from this