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AL-Wahban v. Hamdan

Court of Appeals of Texas, Tenth District

June 12, 2019

HANI AL-WAHBAN, OMAR AL-WAHBAN, AND MUSTAFA AL-WAHBAN, Appellants
v.
YOUSUF HAMDAN, INDIVIDUALLY AND DERIVATIVELY AS A SHAREHOLDER OF HANIS TEXAS TIRES 19, INC., D/B/A TEXAS TIRES OF WACO, Appellees

          From the 414th District Court McLennan County, Texas Trial Court No. 2018-4322-5

          Before Chief Justice Gray, Justice Davis, and Justice Neill.

          MEMORANDUM OPINION

          JOHN E. NEILL JUSTICE.

         In four issues, appellants, Hani Al-Wahban, Omar Al-Wahban, and Mustafa Al-Wahban, challenge a temporary injunction granted in favor of appellee, Yousuf Hamdan, individually and derivatively as a shareholder of Hanis Texas Tires 19, Inc. d/b/a Texas Tires of Waco (collectively "Yousuf"). Because we conclude that the trial court did not abuse its discretion by issuing the temporary injunction, we affirm.

         I. Background

         This case involves a dispute over compensation between Yousuf and appellants, the owners of Texas Tires-a business that generally provides a variety of wheel and tire customization options, as well as other automobile services, for customers. Appellants jointly own thirty-eight stores located throughout Texas, including a store in Waco, Texas, that serves as the basis for this dispute.

         Yousuf had previously worked at several other Texas Tire stores. While working for his brother, David Hamdan, at a Texas Tires store in Euless, Texas, Yousuf received an offer from his friend, Hani, to manage a new Texas Tires location in Waco. According to Hani, Yousuf's compensation was twenty-five percent of the store profits after the opening costs of the store were recouped, with David receiving five percent as a referral fee and Yousuf receiving the remaining twenty percent. Yousuf agreed to this arrangement and began working at the Waco Texas Tires store in late April 2017.

         Yousuf claims "he is a shareholder in and sits on the Board of Directors" of Texas Tires of Waco; however, appellants "claim [Yousuf] was never a shareholder and did not sit on the Board of Directors in Texas Tires of Waco; rather, [appellants] claim [Yousuf] was an employee of Texas Tires of Waco."

         Hani noted in his testimony at the temporary-injunction hearing that the Waco Texas Tires store opened in the middle of March 2017, and that it was initially managed by Jaime Limas. Hani set up the store, including the inventory, computers, and equipment, prior to opening. Hani trained both Limas and Yousuf on how to run the business.

         Yousuf managed the Waco Texas Tires store from late April 2017 to August 2018, when he was asked to pay for tools that an audit revealed were missing. Yousuf refused to pay the "fines," and appellants removed Yousuf from his management position. This resulted in the cessation of Yousuf receiving any share of the profits from the Waco Texas Tires store.

         Approximately four months later, on December 4, 2018, Yousuf filed suit "for all purposes, individually and derivatively as a shareholder of Hanis Texas Tires 19, Inc. d/b/a Texas Tires of Waco" against appellants, alleging causes of action for violations of the Texas Business Opportunity Act, breach of fiduciary duty, conversion, negligent misrepresentation, and unjust enrichment and restitution. Yousuf also requested a declaration that he "is a 25% shareholder and owns 250 of the outstanding 1, 000 shares of Hanis Texas Tires 19, Inc."; he "is a director of Hanis Texas Tires 19, Inc."; and he "retains all rights, privileges, and ownership interest associated with his status of a director and shareholder." Additionally, Yousuf requested injunctive relief against appellants, including a temporary restraining order that was granted by the trial court and a subsequent temporary or permanent injunction.

         Appellants responded by filing a motion to transfer venue, an original answer, special exceptions, a request for disclosure, a motion to dismiss under Texas Rule of Civil Procedure 91a, and, among other things, a verified motion to deny injunctive relief. See Tex. R. Civ. P. 91a.

         After a hearing, the trial court granted Yousuf's request for a temporary injunction. This accelerated, interlocutory appeal followed.

         II. Standard of Review

         "A temporary injunction is an extraordinary remedy and does not issue as a matter of right." Butnaru v. Ford Motor Co., 84 S.W.3d 198, 204 (Tex. 2002) (op. on reh'g) (citing Walling v. Metcalfe, 863 S.W.2d 56, 57 (Tex. 1993)). The question before the trial court is whether the applicant is entitled to preserve the status quo of the litigation's subject matter pending a trial on the merits. Id.; see State v. Sw. Bell Tel. Co., 526 S.W.2d 526, 528 (Tex. 1975) (defining status quo as the "last, actual, peaceable, non-contested status that preceded the pending controversy"); see also Tom James of Dallas, Inc. v. Cobb, 109 S.W.3d 877, 882 (Tex. App.-Dallas 2003, no pet.) (noting that the underlying merits of the controversy are not legal issues pending before the trial court during a temporary-injunction hearing). "To be entitled to a temporary injunction, the applicant must plead a cause of action and show a probable right to recover on that cause of action and a probable, imminent, and irreparable injury in the interim." Fox v. Tropical Warehouses, Inc., 121 S.W.3d 853, 857 (Tex. App.-Fort Worth 2003, no pet.) (citing Butnaru, 84 S.W.3d at 204).

         We review a temporary injunction for an abuse of discretion. See Butnaru, 84 S.W.3d at 204. A trial court abuses its discretion when it acts unreasonably or in an arbitrary manner or without reference to any guiding rules and principles. Id. at 211. We will not disturb the trial court's decision to grant injunctive relief absent a clear abuse of discretion. Reagan Nat'l Advert. v. Vanderhoof Family Tr., 82 S.W.3d 366, 370 (Tex. App.- Austin 2002, no pet.). Our scope of review is limited to the validity of the order granting or denying the temporary injunction. See id. When reviewing the order, we view the evidence in the light most favorable to the order, indulging every reasonable inference in its favor, and "determine whether the order was so arbitrary that it exceeds the bounds of reasonable discretion." Fox, 121 S.W.3d at 857. "A trial court does not abuse its discretion if it bases its decision on conflicting evidence and evidence in the record reasonably supports the trial court's decision." Id.

         III. Imminent and ...


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