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Watson v. Purvis

Court of Appeals of Texas, Fourteenth District

July 9, 2019

CHARLES WATSON, Appellant
v.
TIFFANIE L. PURVIS AND AMAD AL-BANNA, Appellees TIFFANIE L. PURVIS, Appellant
v.
CHARLES WATSON, Appellee

          On Appeal from the 270th District Court Harris County, Texas Trial Court Cause No. 2015-28746

          Panel consists of Justices Wise, Zimmerer, and Spain.

          MEMORANDUM OPINION

          CHARLES A. SPAIN, JUSTICE

         The crux of these two consolidated appeals concerns the breach of a rule 11 settlement agreement recorded in open court. See Tex. R. Civ. P. 11. The trial court granted traditional summary judgment in favor of Charles Watson and against Tiffanie L. Purvis.

         In her appeal, Purvis argues that the trial court erred by granting Watson's motion for summary judgment because fact issues exist regarding enforceability of the settlement agreement and Purvis's affirmative defenses. Purvis further contends that the trial court erred in its awards against her for actual damages, pre-judgment interest, and costs, and by failing to compel Watson's payment of attorney's fees previously awarded to Purvis under rule 91a. See Tex. R. Civ. P. 91a. In his appeal against Purvis, Watson challenges the trial court's decisions to deny his motion for leave to amend his petition and to grant Purvis's motion to exclude evidence regarding Watson's attorney's fees. We sustain Purvis's issues relating to actual damages and pre-judgment interest, and otherwise overrule her issues. We overrule Watson's issues against Purvis.

         Watson also brings an appeal against appellee Amad Al-Banna. Watson challenges the trial court's granting of no-evidence summary judgment in favor of Al-Banna. Watson also argues that counsel for Al-Banna violated rule 199.5(d-h) during Al-Banna's deposition. See Tex. R. Civ. P. 199.5(d-h). We overrule Watson's issues against Al-Banna.

         Accordingly, we reverse the portions of the trial court's judgment awarding principal damages and pre-judgment interest. We render judgment that Watson recover from Purvis "Principal Damages owed under the Recorded Settlement Agreement of $12, 500.00" and "Pre-judgment Interest at the rate of 5% for each of the first two missed payments of $2, 500.00, calculated from the date of suit filing (August 23, 2017) until the day before judgment (February 1, 2018), and for each of the three remaining missed payments of $2, 500.00, respectively calculated from the date of each missed payment (September 15, October 15, and November 15, 2017) until February 1, 2018, which is equivalent to $222.64." We otherwise affirm the trial court's judgment as challenged.

         I. Background

         This case has a storied background. We discuss only what is pertinent on appeal.

         Watson and Purvis engaged in a romantic and real-estate business relationship that ultimately soured. In May 2015, Watson brought claims against Purvis and her company Tiffanie Purvis, Inc. (TP, Inc.) d/b/a Texas Real Estate & Co. for fraud, breach of fiduciary duty, conversion, misappropriation, and conspiracy. Purvis brought counterclaims against Watson for breach of fiduciary duty, quantum meruit, unjust enrichment, and intentional infliction of emotional distress. Watson also brought claims against other entities and individuals, including Al-Banna, for misappropriation based on conspiracy liability. Watson alleged that Al-Banna participated in a conspiracy to use Watson's name in certain real-estate transactions without his permission. The trial court granted various defendants' motions for summary judgment, [1] including a no-evidence motion filed by Al-Banna.

         On May 30, 2017, as trial was set to begin, Watson and Purvis entered into a settlement agreement on the record. Purvis was to pay Watson "a sum of $90, 000 at $2, 500 each and every month until paid in full" and return any of Watson's personal property "on Mr. Watson's list" from two Houston properties "that is contained in the storage facility." The parties agreed there would "be general mutual releases of all claims arising out of any facts, known or unknown, matured or unmatured." The parties also agreed to later "in good faith" address "an ongoing dispute with respect to Waller [County] in terms of some of that personal property."

         Counsel appearing for Watson stated: "On that representation, I believe we have a settlement." Counsel appearing for Purvis and TP, Inc. stated: "Obviously, subject to final paperwork and everything. Even though this would be an enforceable agreement on the record, there may be additional provisions that we want in there." The trial court stated: "Okay. And for our purposes now, we're going to move the case to hold for judgment status." Counsel for Watson further stated: "Only the parties before you are released, however. I just want to make sure that that's clear. No party not represented by any of these parties is part of this settlement." Counsel for Purvis interjected that he wanted to "address" parties Wanda Reyna and Debra Zecchin, whom he also represented, to make sure that they were "released as part of this settlement." Counsel for Purvis further stated: "Well, when I-when I-we had talked about it being a global settlement. That was the intent of that. You know, obviously, they're not appearing because they've been dismissed on summary judgment." Counsel for Watson replied: "Mr. Watson's not going to be silly about this. I mean, Reyna and Zecchin are fine." Counsel for Purvis responded: "Okay." Counsel for Watson later stated: "Okay. Then we have an understanding." Counsel for Purvis replied: "Okay."

         A few weeks later, counsel for Purvis emailed counsel for Watson: "As we discussed, I am still waiting for client approval on the settlement document . . . [b]ut this email confirms that the first $2, 500 payment will be made on or before July 15, 2017, and the personal property that is being released pursuant to the settlement will be tendered by that same date." Purvis, however, did not provide any payment or release Watson's personal property. Instead, Purvis filed a motion for trial setting.

         The trial court granted Purvis's motion for trial setting and granted Watson leave to file a fourth amended petition. Trial was set for January 15, 2018. Watson filed his fourth amended petition against Purvis for breach of contract. Watson then filed a fifth amended petition against Purvis, TP, Inc., Reyna, and Zecchin[2] for breach of contract and declaratory judgment. Watson filed a traditional motion for summary judgment against Purvis. Purvis filed a response.

         On November 16, 2017, Watson filed a motion for leave to file a sixth amended petition to assert fraud claims against counsel for Purvis and his law firm. In his proposed sixth amended petition, Watson sought to add Purvis's trial counsel and his law firm as defendants and bring fraud claims against them in connection with the recorded settlement agreement. The trial court signed an interlocutory order granting Watson's traditional motion for summary judgment against Purvis on December 6, 2017.

         On the morning of what was to be an evidentiary hearing on Watson's attorney's fees, Purvis filed a motion to exclude evidence regarding attorney's fees. The trial court sustained Purvis's objection at the hearing. The trial court signed its final judgment and an order denying Watson leave to file his sixth amended petition on February 2, 2018. Watson and Purvis timely appealed. Watson filed his appeal against Purvis and Al-Banna; Purvis filed her appeal against Watson.

         II. Analysis

         A. Purvis's appeal

         1. The rule 11 settlement agreement is binding and enforceable.

         In her first issue, Purvis argues the trial court erred in concluding that the transcript was a binding and enforceable rule 11 settlement agreement. Purvis contends that the parties did not agree on the essential terms of the purported contract and the transcript "is missing global release language and other material terms." Purvis also argues there is a fact issue regarding whether the parties' respective LLCs were intended to be part of the global settlement. Viewed as a whole, we conclude that the transcribed agreement is binding and enforceable.

         Texas Rule of Civil Procedure 11 provides: "Unless otherwise provided in these rules, no agreement between attorneys or parties touching any suit pending will be enforced unless it be in writing, signed and filed with the papers as part of the record, or unless it be made in open court and entered of record." Tex.R.Civ.P. 11. Purvis does not dispute that the purported settlement was made in open court and entered of record.

         A rule 11 settlement agreement must contain all the essential terms of the settlement. Padilla v. LaFrance, 907 S.W.2d 454, 460 (Tex. 1995). Essential terms of a rule 11 settlement agreement include payment terms and release of claims. See id. at 460-61. We construe rule 11 settlement agreements as we do any other contract. MKM Eng'rs, Inc. v. Guzder, 476 S.W.3d 770, 778 (Tex. App.-Houston [14th Dist.] 2015, no pet.). Here, the plain language of the transcript reflects that Purvis would pay Watson $90, 000 in monthly payments of $2, 500 and return certain of Watson's personal property; that Purvis and Watson would enter general mutual releases of all claims arising out of any facts, known or unknown, matured or unmatured; and that Purvis and Watson would work in good faith to address the remaining claims pertaining to personal property in Waller County. The settlement therefore included the essential terms of payment and release of claims. See Padilla, 907 S.W.2d at 460-61; MKM Eng'rs, 476 S.W.3d at 778, 782.

         According to Purvis, however, certain language in the transcript confirms that essential terms were missing. First, Purvis points to the statement that "[t]here will be general mutual releases" and argues this "brief recitation" does not "comprise[] such a release." We rejected a similar argument in MKM Engineers. See 476 S.W.3d at 781-82 (rejecting argument that rule 11 settlement agreement was missing essential and material term because it "provide[d] only that full releases 'will' be provided in the future"). Moreover, the transcript contains clear language that the parties before the trial court "are released" as "part of this settlement" and that Reyna and Zecchin "are fine" and thus "released as part of this settlement."

         Purvis next points to this language: "Obviously, subject to final paperwork and everything. Even though this would be an enforceable agreement on the record, there may be additional provisions that we want in there." According to Purvis, "[t]he foregoing acknowledges that the payment amount and few other terms on the record are binding, but that the parties necessarily would need further work to negotiate and fully document the balance of the terms." Purvis also argues that additional "good faith" efforts would be required for the parties to address the Waller County litigation. Purvis's position, however, is based on an incorrect premise- parties need not agree to all terms of a settlement agreement and memorialize them in a formal writing before there can be an enforceable agreement. See id. at 778; Robinson v. Cason, No. 01-11-00916-CV, 2013 WL 3354651, at *7 (Tex. App.- Houston [1st Dist.] July 2, 2013, no pet.) (mem. op.). Here, the language that "this would be an enforceable agreement on the record"; multiple references to the "settlement"; and the statement they had "an understanding" reflect that the parties intended their agreement to be a present, binding agreement. That Watson and Purvis would reduce their agreement to "final paperwork" and left "additional provisions" to be (possibly) negotiated and agreed later does not render the transcribed agreement unenforceable. See MKM Eng'rs, 476 S.W.3d at 779, 781-82 (no fact issue raised on enforceability even though "the parties contemplated taking additional actions and executing a final settlement agreement at a later date" and when "other non-essential or collateral matters [were] left for future negotiation").

         Purvis also contends that the intent of the parties' "global settlement" was to reach the broader scope of the parties' business dealings within a final comprehensive written settlement agreement. However, the plain language of the transcript indicates that the "global" nature of the settlement referred to its inclusion of Reyna and Zecchin. We also do not agree with Purvis that counsel for Watson's statement that Watson was "not going to be silly about this" referred to "the context of crafting the full scope of the release" rather than the context of including Reyna and Zecchin as parties to the settlement.

         Although Purvis does not assert that the language in the transcript is ambiguous, she argues-primarily based on Watson's testimony concerning his ties to Purvis's various businesses-there is a fact issue on whether the parties intended to include their respective LLCs to be part of the "global settlement." However, intent that is clear and unambiguous on the face of the agreement may be determined as a matter of law. See Coker v. Coker, 650 S.W.2d 391, 393 (Tex. 1983). Nothing in the transcript indicates that the settlement agreement was intended to reach any further than the parties at hand (plus Reyna and Zecchin) and all their claims. Nor does anything in the transcript indicate the parties intended that their settlement agreement not be enforceable until their "respective LLCs" were addressed. We therefore must reject Purvis's attempt to alter the parties' expression of their intent. See 1st Res. Grp., Inc. v. Olukoga, No. 02-16-00136-CV, ...


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