Searching over 5,500,000 cases.

Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

Comerica Bank v. Progressive Trade Enterprises, Inc.

Court of Appeals of Texas, Fourteenth District

February 22, 2018


         On Appeal from the 215th District Court Harris County, Texas Trial Court Cause No. 2014-32443

          Panel consists of Chief Justice Frost and Justices Busby and Wise.



         In this appeal from a take-nothing judgment in a non-jury trial on a suit to recover on a promissory note and guaranty agreement, appellant Comerica Bank contends that the trial court erred in granting an oral motion for judgment on its claims against appellees Progressive Trade Enterprises, Inc., the maker of the note, and Poul Nielsen, as guarantor, on the grounds that Comerica Bank sought to introduce a copy of the promissory note rather than the original. We affirm in part and reverse and remand in part.


         For at least ten years, Poul Nielsen and Progressive Trade Enterprises, Inc. (Progressive) did business with Sterling Bank (Sterling) in connection with Progressive's business. On August 22, 2008, Nielsen, as president of Progressive, signed a promissory note with Sterling in the principal amount of $132, 371.83 (the Note). No payments were ever made on the Note.

         In 2011, Sterling merged with Comerica Bank (Comerica). In 2014, Comerica filed a suit alleging that Progressive failed to comply with the terms of the Note and that Nielsen failed to comply with the terms of one or more of several previously executed guaranty agreements.

         A trial was held before the court on Comerica's claims in December 2016. Comerica's first witness was Mary Ellen Hensley, Comerica's vice president for special assets and the custodian of records for the loan file for Progressive and Nielsen. Hensley testified that Sterling had merged with Comerica, and that Comerica, as the surviving entity, acquired all the loans and assets of Sterling by that merger, including the Note and guaranty agreements. Hensley identified Plaintiff's Exhibit 1 as a true and correct copy of the Note.

         When Comerica offered its copy of the Note into evidence, Progressive and Nielsen's counsel asked to examine Hensley on voir dire. In response to counsel's questions, Hensley testified that Comerica "came to be the holder in due course" of the Note, that the original Note was located in Comerica's collateral department in Michigan, and that she was not told to bring an original because "the copy was an exhibit that I could depended [sic] on." When asked how she could confirm that the original Note had not been transferred to another bank that was actually the holder in due course, Hensley testified, "I'm verifying that they have not."

         Progressive and Nielsen's counsel objected to the admission of Plaintiff's Exhibit 1. The trial court stated that it would not admit the exhibit "right now, " but allowed Comerica to "lay a little bit more foundation."

         Hensley proceeded to testify on direct examination that no payments were made on the Note after it was executed and that Comerica was seeking principal and interest of $99, 019.58.[1] On cross-examination, Hensley was questioned about Defendant's Exhibit 15, a copy of the Note admitted into evidence at Progressive and Nielsen's request, in connection with the guaranty agreements Nielsen had executed some years earlier. After Hensley's testimony concluded, counsel for Comerica did not reoffer Plaintiff's Exhibit 1 or request a ruling on the admissibility of its exhibit.

         Nielsen testified that shortly after executing the Note, he asked Sterling if it could find a "temporary solution" to his inability to make payments, which he explained was due to the then-existing financial crisis. According to Nielsen, a Sterling representative named Mr. Naudain informed him that Sterling had decided to terminate its arrangement and close the account. Nielsen stated that he never heard anything more about the loan until he was notified in 2014 that a lawsuit had been filed.[2] Nielsen confirmed that Progressive made no payments on the Note. He also confirmed his signature on Plaintiff's Exhibit 1, Comerica's copy of the Note.

         After Comerica rested its case, Progressive and Nielsen moved for a "directed verdict, "[3] arguing that the original Note was not in evidence, Comerica had no explanation for failing to present it, and therefore Comerica's claim that it was a holder in due course was unreliable. Comerica's counsel responded that Comerica was not a holder in due course, but was the owner and holder of the Note through its merger with Sterling.

         The trial court granted Progressive and Nielsen's motion for directed verdict "as to Plaintiff's not having reason as to why or failing to show the existence of the original and why we should rely on the copy of this document." The trial court did not expressly rule that Plaintiff's Exhibit 1 was not admitted at this time, but the record reflects that the exhibit was not admitted into evidence.

         On January 4, 2017, the trial court signed a final judgment that Comerica take nothing against Progressive and Nielsen. The trial court's order did not specify the basis for its ruling. The Bank moved for a new trial, ...

Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.