Opinion
NO. 01-14-00893-CV
01-21-2016
1221 ELDRIDGE ROAD, INC., Appellant v. LIFE CHANGING MINISTRIES AND FELLOWSHIP, INC., ERIC STEPHENS, AND JENNIFER STEPHENS, Appellees
On Appeal from the County Court at Law No. 1 Fort Bend County, Texas
Trial Court Case No. 13-CCV-050162
MEMORANDUM OPINION
This is a commercial landlord-tenant dispute. Appellees Life Changing Ministries and Fellowship, Inc., Eric Stephens, and Jennifer Stephens (collectively "LCM") leased two spaces from Appellant 1221 Eldridge Road, Inc. ("Eldridge") for use as a church and daycare center. The relationship eventually soured, with Eldridge demanding that LCM pay certain amounts it claimed were due under the leases, and LCM contending that it did not owe the money and accusing Eldridge of trying to extort money from it. LCM vacated the leased spaces, and Eldridge sued for breach of the leases. LCM countersued for breach of the leases, breach of the warranty of quiet enjoyment, and constructive eviction. A jury found that both parties breached the leases, that Eldridge breached first, and that LCM was entitled to $15,000 in attorney's fees. Eldridge appeals, arguing that the trial court erred in denying its motion for directed verdict on LCM's claims and its motion to disregard several of the jury's answers. Because the evidence is legally insufficient to support the jury's findings in LCM's favor on its claims against Eldridge, we reverse the trial court's judgment, render judgment on LCM's claims, and remand Eldridge's claims for a new trial.
Background
In 2002, Eric and Jennifer Stephens started a church named Life Changing Ministries and Fellowship. The church met in their home until 2008, when Eric and Jennifer signed a 36-month lease on behalf of Life Changing Ministries and Fellowship, Inc. for space located at 1255 Eldridge Road in Sugar Land, Texas. The space was part of the Covington Square development owned by Eldridge. The 1255 lease began on March 1, 2008. By May 2009, the church had grown, so Eric and Jennifer signed a second 36-month lease for an adjacent space located at 1243 Eldridge Road.
According to Eric's trial testimony, the "turning point" in LCM's relationship with Eldridge occurred in November 2010. Eldridge's property manager, Scott Pierce, sent a letter to LCM on November 26, 2010, demanding $300.54 for charges related to a water leak. According to Pierce's trial testimony, the master water meter for Covington Square showed a leak, and because none of the other sub-meters showed a leak and he was unable to access LCM's sub-meters, he concluded the leak must be in LCM's space. LCM refused to pay the demand because its sub-meters did not show any leaks. Eric testified that Pierce had keys to LCM's spaces and regularly visited, and LCM had no reason to believe that Pierce was unable to access the sub-meters. Pierce testified that he was later able to confirm that there was no leak in LCM's space and therefore did not continue to demand the $300.54. Eric testified that the demand was never officially retracted, although it did not appear in subsequent communications from Pierce.
The 1255 lease was set to expire in February 2011 and the 1243 lease was set to continue until May 2012. On January 5, 2011, LCM wrote to Eldridge, proposing that the parties sign a single 36-month lease for the two spaces and establish a specific day on which the water sub-meters would be read. On January 12, 2011, Eldridge responded with a letter requesting payment for several items before Eldridge considered extending the 1255 lease.
• Actual past water usage. LCM had installed sub-meters in its spaces to measure its water usage. LCM had previously been making estimated payments for water which were lower than the actual charges. Eldridge wanted LCM to pay the difference between the estimated amount paid and the actual amount used since the inception of the 1255 lease.Eldridge's letter informed LCM that the total outstanding amount under both leases was $3,278.20.
• Sign fees. LCM had installed a pylon sign shortly after signing the 1255 lease, and Eldridge requested that LCM pay a monthly $40 sign fee for July 2008 to April 2009 and a monthly $45 sign fee for May 2009 to April 2010.
• Unpaid rent and late fees. Eldridge requested LCM pay unpaid rent amounts and late fees for the unpaid amounts.
LCM responded on January 21, 2011, noting that LCM believed that it had been paying its rent timely and did not believe any further amounts were due for water. LCM offered $1,500 to settle the dispute and again proposed that the parties sign a combined lease for the two spaces.
Eldridge responded on February 19, 2011 with a letter entitled "FINAL DEFAULT NOTICE." The letter stated that Eldridge would not negotiate a new lease until all outstanding amounts were paid in full. The letter stated that LCM owed $4,643.53 in unpaid rent, water, sign fees, and late fees, and also included a $2,981.53 charge for adjusted Common Area Maintenance (CAM) that had not been mentioned in Eldridge's letter of January 12th. The letter reminded LCM of the procedures it must follow if it vacated the premises and noted that the lease provided that a holdover tenant who stays beyond the lease term must pay twice the rental rate.
Eric testified that after receiving the February 19 letter, the church held a final service and moved out of both spaces to a new location. Eric testified that he believed that Eldridge forced LCM out because Pierce refused to talk to them about extending the 1255 lease unless LCM paid the amounts that Pierce was demanding, and the church could not operate solely in the 1243 space.
After LCM vacated the spaces, Eldridge sued LCM for breach of both leases. LCM counterclaimed for breach of the leases, arguing that Eldridge's payment demands were unsupported and constituted a breach. LCM also claimed that Eldridge's actions constituted breach of the warranty of quiet enjoyment and constructive eviction from the 1243 space.
At the close of the evidence, the trial court denied Eldridge's motion for a directed verdict on all of LCM's claims. The jury found that both Eldridge and LCM breached the leases and that Eldridge breached each lease first. The jury also found that Eldridge breached LCM's warranty of quiet enjoyment and constructively evicted LCM from the 1243 space. The jury awarded $15,000 in attorney's fees. Eldridge moved the trial court to disregard several of the jury's answers, but the trial court entered judgment on the verdict.
Motion to Disregard Jury Questions
In its first four issues, Eldridge contends that the trial court erred in denying its motion to disregard the jury's findings that (1) Eldridge breached both leases, (2) Eldridge breached both leases before LCM breached either; (3) Eldridge breached LCM's warranty of quiet enjoyment and constructively evicted LCM with regard to the 1243 lease, (4) LCM was entitled to $15,000 in attorney's fees and, (5) Eldridge was not entitled to damages and attorney's fees.
A. Standard of Review
We review the denial of a motion to disregard a jury finding for legal sufficiency. See City of Keller v. Wilson, 168 S.W.3d 802, 823 (Tex. 2005); see also TEX. R. CIV. P. 301 (trial court may "disregard any jury finding on a question that has no support in the evidence"). "[L]egal-sufficiency review in the proper light must credit favorable evidence if reasonable jurors could, and disregard contrary evidence unless reasonable jurors could not." City of Keller, 168 S.W.3d at 827. "The final test for legal sufficiency must always be whether the evidence at trial would enable reasonable and fair-minded people to reach the verdict under review." Id. We will sustain a legal-sufficiency or "no evidence" challenge only when: (a) the record discloses a complete absence of evidence of a vital fact; (b) the court is barred by rules of law or of evidence from giving weight to the only evidence offered to prove a vital fact; (c) the evidence offered to prove a vital fact is no more than a mere scintilla; or (d) the evidence establishes conclusively the opposite of the vital fact. Id. at 810.
When challenging the legal sufficiency of an adverse jury finding on which the appellant had the burden of proof at trial, the appellant "must demonstrate that the evidence conclusively establishes, as a matter of law, all facts in support of the issue (for rendition), or, alternatively, that the jury's adverse finding is against the great weight and preponderance of the evidence (for remand)." Jordan v. Sava, Inc., 222 S.W.3d 840, 853 (Tex. App.—Houston [1st Dist.] 2007, no pet.) (citing Sterner v. Marathon Oil Co., 767 S.W.2d 686, 690 (Tex. 1989)). When challenging the legal sufficiency of the evidence to support a finding on which it did not have the burden of proof at trial, the appellant must demonstrate that no evidence exists to support the adverse finding. Casino Magic Corp. v. King, 43 S.W.3d 14, 19 (Tex. App.—Dallas 2001, pet. denied) (citing Croucher v. Croucher, 660 S.W.2d 55, 58 (Tex. 1983)).
In our legal-sufficiency review, "we must view the evidence in a light that tends to support the finding of disputed fact and disregard all evidence and inferences to the contrary." Wal-Mart Stores, Inc. v. Miller, 102 S.W.3d 706, 709 (Tex. 2003). If more than a scintilla of evidence supports the jury's finding, "the jury's verdict . . . must be upheld." Id. "[M]ore than a scintilla of evidence exists if the evidence 'rises to a level that would enable reasonable and fair-minded people to differ in their conclusions.'" Ford Motor Co. v. Ridgway, 135 S.W.3d 598, 601 (Tex. 2004) (quoting Merrell Dow Pharm., Inc. v. Havner, 953 S.W.2d 706, 711 (Tex. 1997)). Conversely, evidence that is "so weak as to do no more than create a mere surmise or suspicion" is no more than a scintilla and, thus, no evidence. Id. (quoting Kindred v. Con/Chem., Inc., 650 S.W.2d 61, 63 (Tex. 1983)).
B. LCM's claims
1. Does legally sufficient evidence support the jury's finding that Eldridge breached the leases first?
In its first issue, Eldridge contends that there was no evidence to support the jury's findings that Eldridge breached both leases, and in its second issue, Eldridge contends that the evidence conclusively shows that it did not breach the leases first. The elements of a breach of contract claim are: (1) the existence of a valid contract; (2) performance or tendered performance by the plaintiff; (3) breach of the contract by the defendant; and (4) damages sustained by the plaintiff as a result of the breach. Dorsett v. Cross, 106 S.W.3d 213, 217 (Tex. App.—Houston [1st Dist.] 2003, pet. denied).
LCM contended that Eldridge breached the leases in four ways: (1) by demanding payment in January and February 2011 for the difference between past months' actual water use and the lower amount Eldridge had been charging LCM for estimated use for those months; (2) by charging LCM for all CAM adjustments in January and February 2011 instead of yearly; (3) by not signing a separate sign agreement for the 1255 lease and charging $45 per month as a sign fee for the 1243 lease; and (4) by accepting late rent payments without notifying LCM that late rent payments were a default, and then demanding late fees in January and February 2011 for previous late rent payments. We address each of these issues in turn.
a. Water
LCM argued that Eldridge breached the leases by demanding payment in January and February 2011 for the difference between the estimated water payments it had been making and the actual monthly water use since March 2008. It is undisputed that LCM installed sub-meters in its two spaces to measure its actual water use. The parties agree that until January 2011 Eldridge charged LCM only for estimated water use. In January 2011, Eldridge demanded that LCM pay for the actual water charges that LCM had incurred in the preceding months, which exceeded the estimated amounts that LCM had previously paid to Eldridge. LCM contends that the leases do not permit Eldridge to belatedly request payment for LCM's actual water usage and that Eldridge breached the leases by initially charging for estimated water usage.
Article 8.1 of the leases provides:
In the event the water consumed at the demised premises is measured by a single water meter serving only the demised premises, Tenant shall promptly pay all charges for water furnished to the demised premises. In the event a single water meter serves the demised premises and other premises at the Center, Tenant shall pay to Landlord along with the monthly rental payment ONE HUNDRED DOLLARS . . . as an initial estimate for the water and sewage usage for the demised premises. . . . Landlord shall compute and determine, periodically during the lease term, the cost of water and sewer services furnished to the demised premises and may adjust the monthly estimate accordingly. If Tenant should contest the amount Landlord charges Tenant for utility services, Tenant shall have the burden of proving that Tenant's actual use of utility services was less than the amount of such services billed to Tenant by Landlord. Landlord may require Tenant, at Tenant's cost, to install a submeter to measure the water and sewer usage to the demised premises.(Emphasis added.) Section 20 of Exhibit A to the leases provides:
Tenant will be charged for water and sewage usage based on city rates from the tenant's sub-meter readings, and/or Landlord's estimated monthly water usage by tenant at Landlord's sole discretion. . . . If there is a dispute over landlord supplied utility usage and/or tenant refuses to pay for utilities consumed, landlord may terminate its utility service to tenant upon 15 days written notice to tenant; henceforth,
tenant will be responsible to provide tenant's own utility service at tenant's own expense. As an alternative, at Landlord's option, Landlord may require tenant at tenant's own expense, install a sub-meter within seven days upon written notice from landlord, to measure all of tenant's monthly water usage.(Emphasis added.)
The relevant provisions of both leases are identical except where specifically noted.
Thus, because LCM had its own sub-meters, Article 8.1 of the lease expressly provided that LCM was responsible for paying for its actual water usage. LCM did not adduce any evidence showing that it did not actually use the water for which Eldridge sought to charge it in January 2011. In fact, the evidence showed that the estimated water charges were lower than the actual water charges incurred by LCM. LCM instead argues that Eldridge could not charge it for past months' actual water usage after accepting several years' worth of estimated payments. Essentially, LCM argues that Eldridge waived its right to charge LCM for actual water usage.
However, the leases provide that "Tenant shall promptly pay all charges for water furnished to the demised premises." They do not expressly state when actual water usage must be charged. Moreover, Section 20 of Exhibit A states that LCM may be charged for actual or estimated usage at Eldridge's sole discretion. Thus, we reject LCM's contention that Eldridge breached the leases by initially charging LCM for estimated water usage.
We note also that the jury was instructed that it should not find that LCM breached the leases if it concluded that Eldridge waived its right to demand that LCM comply with the leases. In finding that LCM breached the leases, the jury rejected LCM's argument that Eldridge waived LCM's compliance with the terms of the leases. The jury was not instructed to consider waiver in determining whether Eldridge breached the leases, and LCM does not complain about this failure on appeal.
LCM also adduced evidence that Eldridge demanded in November 2010 that LCM pay $300.54 for a water leak that actually occurred in a different tenant's space. Pierce claimed that Eldridge had to guess as to whether the leak was in LCM's space because he was unable to access LCM's water meters when necessary. The jury could have discredited Pierce's testimony in light of Eric's conflicting testimony that Pierce had keys to the spaces and regularly visited the spaces. Nevertheless, the evidence showed that Eldridge abandoned this demand after learning that the leak was not in LCM's space and that it was not among the charges requested by Eldridge in the January 2011 and February 2011 letters. LCM did not adduce any evidence showing how this demand, which was later abandoned, damaged it. Accordingly, this evidence of an abandoned demand for payment could not support the jury's finding of a breach on the part of Eldridge.
Accordingly, there is no evidence that Eldridge breached either lease by demanding payment for LCM's water usage.
b. Common Area Maintenance (CAM)
LCM argued that Eldridge breached the leases by charging it $2,981.53 for all adjustments to CAM in January 2011 as the 1255 lease was ending, instead of assessing any adjustments to CAM charges at the end of each year during the leases' terms. The leases contain two provisions governing CAM charges. Article 2.3 provides in part:
Tenant shall initially pay $.135 (13.5 c) C.A.M. per square foot . . . of leased space monthly, along with the monthly rental payment, as an estimate for the Tenant's prorated share of Taxes, Insurance and Common Area Maintenance as hereinafter specified in Article[] 3.3 . . . . Actual expenses will be calculated annually, at which time Tenant's pro rata share shall be adjusted based upon the monthly contributions made. Tenant shall pay any difference between the estimated amount collected and the actual expenses to Landlord within 10 days after demand by Landlord.Section 8 of Exhibit A to the leases provides:
Landlord may charge c.a.m., or tax & insurance reimbursement at any time at Landlord's discretion, or at the end of Tenant's lease. If there is any conflict, this paragraph supersedes the standard lease agreement Article 2.3 on when to charge c.a.m.Thus, Section 8 supersedes Article 2.3 with respect to when to charge CAM.
However, LCM contends that Section 8 does not supersede Article 3.3 of the leases, which provides:
In addition to rentals and other charges prescribed in this Lease, Tenant shall pay to Landlord (as additional rent hereunder), Tenant's proportionate share of the Common Area Costs hereinafter defined. Landlord may, at its option, make monthly or other periodic charges based upon the estimated Common Area Costs, payable in advance
but subject to adjustment after the end of each calendar year during the term of this Lease on the basis of the actual Common Area Costs in such year. Upon the computation of such adjustment, Tenant shall pay to Landlord the amount of any deficiency, or Landlord shall credit to Tenant the amount of any excess, as the case may be.LCM contends that, because Article 3.3 provides that Common Area Costs are "subject to adjustment after the end of each calendar year," the leases are contradictory and ambiguous regarding when Eldridge was entitled to charge LCM for CAM.
But Article 3.3 provides only that Common Area Costs are subject to adjustment "after the end of each calendar year." It does not dictate when the charges should be passed on to LCM. Section 8, on the other hand, expressly states that CAM may be charged "at any time at Landlord's discretion, or at the end of Tenant's lease" and that it "supersedes the standard lease agreement Article 2.3 on when to charge c.a.m." Thus, the lease terms expressly permitted Eldridge to charge LCM for CAM adjustments in January 2011.
Accordingly, there is no evidence that Eldridge's demand in 2011 that LCM pay the adjusted CAM expenses constituted a breach of the leases.
c. Signs
LCM installed a pylon sign without Eldridge's written approval or the execution of a separate sign agreement shortly after it signed the 1255 lease. LCM contended that Eldridge breached the leases by not signing a separate sign agreement and by charging $45 per month as a sign fee for the 1243 lease. Section 3 of Exhibit A to the leases provides:
All signs must have prior written approval of lessor and are to be installed within 30 days of signing the lease, this provision will be strictly enforced. Lessee must submit a drawing to the lessor for approval. Lessee shall not place or affix any signs or other objects upon or to the roof or exterior walls of the lease premises or paint or otherwise deface the exterior of the leased premises without the prior written consent of lessor. Any signs installed by lessee shall conform with applicable laws and deed and other restrictions. If Tenant wishes to use any pylon sign or sign frame supplied by Landlord, Tenant will sign a sign agreement separate from this lease.(Bold emphasis in original; italic emphasis added.) Section 21 of Exhibit A to the 1255 lease provides:
If Tenant installs a sign on any structure supplied by Landlord, Tenant will pay a monthly sign fee of forty dollars to Landlord.Section 21 of Exhibit A to the 1243 lease contains the same provision, except the amount of the sign fee is $45.
With respect to LCM's argument regarding the failure to sign a separate sign agreement, LCM did not adduce any evidence regarding how its failure to sign a separate sign agreement constitutes a breach on the part of Eldridge. The 1255 lease itself required LCM to pay a $40 monthly fee if it installed a sign, irrespective of whether a separate sign agreement was signed, and LCM conceded that it did install a sign. LCM argues that it was not made aware that Eldridge believed LCM had failed to pay the sign fee until January 2011, but LCM is presumed to know that it was required to pay the monthly sign fee because it was a term of the leases. See, e.g., In re Int'l Profit Assocs., Inc., 286 S.W.3d 921, 923 (Tex. 2009) (party who signs document is presumed to know its contents); Cantella & Co. v. Goodwin, 924 S.W.2d 943, 944 (Tex. 1996) (same). The leases also provide that "Forbearance by Landlord to one or more of the remedies herein provided upon an event of default shall not be deemed or construed to constitute a waiver of such default." Thus, under the leases' terms, Eldridge retained the right to demand that LCM pay the sign fees.
LCM also contends that because it installed a sign before it signed the 1243 lease, and not after, Eldridge's demand that it pay the $45 monthly sign fee contained in the 1243 lease was a breach of that lease. But LCM concedes that it did install a sign on a structure supplied by Eldridge, and Section 21 of Exhibit A does not provide an exception for signs installed before the lease was signed. The evidence conclusively proved that LCM (the "Tenant") "install[ed] a sign on [a] structure supplied by" Eldridge (the "Landlord").
Accordingly, there is no evidence that Eldridge's January 2011 demand that LCM pay unpaid monthly sign fees was a breach of the leases.
d. Rent
LCM contended that Eldridge breached the leases by accepting late rent payments, not notifying LCM each time Eldridge considered a late rent payment to be a default, and then demanding late fees in one lump sum in January and February 2011. The 1255 lease provided that the monthly rent "must be received by Landlord on or before the first day of each calendar month," and the 1243 lease provided that the monthly rent was "due & is to be received by Landlord on or before the 15th day of each calendar month." The leases provide:
[I]f any installment or rent or other charges due from Tenant under this Lease is not received by Landlord when due, Tenant shall pay to Landlord an additional sum of ten percent (10%) of the overdue rent or other charges due from Tenant under this Lease as a late charge. The parties agree that this late charge represents a fair and reasonable estimate of the costs that Landlord will incur by reason of late payments by Tenant. Acceptance of any late charge shall not constitute a waiver of Tenant's default with respect to the overdue amount or prevent Landlord from exercising any of the other rights and remedies available to Landlord.The leases provide that failure to pay rent when due is a default under the leases. And as previously discussed, the leases also provide that "Forbearance by Landlord to one or more of the remedies herein provided upon an event of default shall not be deemed or construed to constitute a waiver of such default."
LCM did not dispute that Eldridge did not receive its rental payments "on or before" the date specified in each lease for the months claimed. Rather, Eric and Jennifer testified that they thought it was sufficient to place the rent check in the mail by the first or the fifteenth of the month and LCM argued that late payments did not constitute a breach of the leases unless Eldridge notified them that each late payment was a default. On appeal, LCM argues that Eldridge breached by waiting until January 2011 to notify LCM of its late payments.
But the leases expressly recognized that late payment was a default, and provided that forbearance by Eldridge to enforce the remedies provided in the leases for late payment did not constitute a waiver of that default. Thus, forbearance by Eldridge could not constitute waiver, and Eldridge's eventual enforcement of the terms of the leases could not constitute a breach, because Eldridge was acting in accordance with the terms of the leases.
As previously noted, the jury rejected LCM's waiver argument when it found that LCM had breached the leases and was not instructed to consider waiver in determining whether Eldridge breached the leases.
In sum, LCM presented no evidence that Eldridge's conduct constituted a breach of the leases. Accordingly, we hold that the evidence supporting the element of breach by Eldridge, an essential element of LCM's breach claims, is legally insufficient and, thus, the trial court erred in denying Eldridge's motion to disregard the jury's findings that Eldridge breached both leases. See Dorsett, 106 S.W.3d at 217 (breach by defendant is essential element of breach of contract claim); see, e.g., He v. Jiang, No. 01-16-00255-CV, 2007 WL 2264474, at *4 (Tex. App.—Houston [1st Dist.] Aug. 9, 2007, no pet.) (where evidence showed defendant's actions were consistent with contract, evidence was legally insufficient to establish breach of contract claim).
Because we have held that legally insufficient evidence supports the jury's findings that Eldridge breached the leases, we necessarily also hold that the jury's findings that Eldridge breached the leases first are supported by legally insufficient evidence. We therefore sustain Eldridge's first and second issues.
2. Does legally sufficient evidence support the jury's finding that Eldridge breached LCM's warranty of quiet enjoyment and constructively evicted LCM with regard to the 1243 lease?
Eldridge contends in its third issue that the trial court erred in denying its motion to disregard the jury's finding that Eldridge breached LCM's warranty of quiet enjoyment and constructively evicted LCM with regard to the 1243 lease because the evidence conclusively shows that LCM did not have an implied covenant of quiet enjoyment and Eldridge did not constructively evict LCM from the 1243 space.
a. Applicable Law
"A constructive eviction occurs when the tenant leaves the leased premises due to conduct by the landlord which materially interferes with the tenant's beneficial use of the premises." Fidelity Mut. Life Ins. v. Robert P. Kaminsky, M.D., P.A., 768 S.W.2d 818, 819 (Tex. App.—Houston [14th Dist.] 1989, no writ). "Texas law relieves the tenant of contractual liability for any remaining rentals due under the lease if he can establish a constructive eviction by the landlord." Id. "Constructive eviction essentially terminates mutuality of obligation as to the lease terms, because the fundamental reason for the lease's existence has been destroyed by the landlord's conduct." Downtown Realty, Inc. v. 509 Tremont Bldg., Inc., 748 S.W.2d 309, 313 (Tex. App.—Houston [14th Dist.] 1988, no writ). The elements of a cause of action for constructive eviction are (1) an intention on the part of the landlord that the tenant shall no longer enjoy the premises, (2) a material act by the landlord that substantially interferes with the tenant's intended use and enjoyment of the premises, (3) an act that permanently deprives the tenant of the use and enjoyment of the premises, and (4) abandonment of the premises by the tenant within a reasonable time after the commission of the act. Lazell v. Stone, 123 S.W.3d 6, 11-12 (Tex. App.—Houston [1st Dist.] 2003, pet. denied). The elements of a breach of the warranty of quiet enjoyment are the same as the elements in a constructive eviction claim. Id. at 12 n.1.
b. Analysis
LCM argued that the acts that constituted breach of the leases by Eldridge also amount to a constructive eviction of LCM from the 1243 space and a breach of the warranty of quiet enjoyment with respect to that space. LCM argued that Eldridge's demand that it pay all outstanding amounts or vacate the 1255 property at the end of the 1255 lease also forced LCM to vacate the 1243 space.
However, as discussed above, the conduct about which LCM complains was authorized under the terms of the leases and therefore could not constitute a substantial interference with the tenant's use and enjoyment of the property. Accordingly, we hold that the evidence supporting LCM's breach of the warranty of quiet enjoyment and constructive eviction claims are legally insufficient and, thus, the trial court erred in denying Eldridge's motion to disregard the jury's finding that Eldridge breached LCM's warranty of quiet enjoyment and constructively evicted it from the 1243 space. See Lazell, 123 S.W.3d at 11-12 (to prevail on constructive eviction and breach of warranty of quiet enjoyment claims, plaintiff must demonstrate material act by landlord that substantially interferes with tenant's intended use and enjoyment of premises and act that permanently deprives tenant of use and enjoyment of premises).
We sustain Eldridge's third issue.
Because we have concluded that the evidence supporting LCM's breach of the warranty of quiet enjoyment and constructive eviction claims is legally insufficient, we need not reach Eldridge's alternative argument that LCM did not have the right to an implied covenant of quiet enjoyment.
3. Does legally sufficient evidence support the jury's finding that LCM is entitled to $15,000 in attorney's fees?
In part of its fourth issue, Eldridge contends that the trial court erred in denying its motion to disregard the jury's answer to Question Number 11, in which the jury awarded LCM $15,000 as reasonable and necessary fees for LCM's attorney's services in the case. Because we have concluded that the trial court erred in denying Eldridge's motion to disregard the jury's answers to the liability questions supporting the award of these fees to LCM, we necessarily must conclude that the trial court erred in failing to disregard the jury's answer to Question Number 11 and in awarding LCM $15,000 in attorney's fees. See Nat'l Cas. Co. v. Charlie Hinds Paint & Body, Inc., 434 S.W.3d 254, 260 (Tex. App.—Houston [1st Dist.] 2014, no pet.) (reversing award of attorney's fees where no evidence supported underlying liability finding).
We sustain Eldridge's fourth issue with respect to the award of attorney's fees to LCM.
C. Eldridge's claims
Eldridge contends in the remainder of its fourth issue that the trial court erred in denying its motion to disregard the jury's answers to Questions Numbers 7 and 8 because the evidence conclusively shows that LCM breached the leases and that Eldridge is entitled to damages and attorney's fees. Questions Numbers 7 and 8 asked the jury to calculate Eldridge's damages and attorney's fees. However, the jury was instructed to answer these questions only if it concluded that LCM committed the first breach of each of the leases. Because the jury concluded that Eldridge committed the first breach of each of the leases, it did not answer Questions Numbers 7 and 8.
Eldridge requests that we reverse the judgment on its claims against LCM and remand the case to the trial court for entry of judgment in Eldridge's favor on Eldridge's claims. However, because the jury did not make findings regarding Eldridge's damages and attorney's fees, we must instead reverse and remand for a new trial on Eldridge's claims. See TEX. R. APP. P. 44.1(b) ("The court may not order a separate trial solely on unliquidated damages if liability is contested."); Vega v. Fulcrum Energy, LLC, 415 S.W.3d 481, 494 (Tex. App.—Houston [1st Dist.] 2013, pet. denied) (remand for new trial on all issues required where liability was contested and damages are unliquidated).
Because we are reversing the judgment and remanding the cause for a new trial on Eldridge's claims against LCM, we do not reach Eldridge's fifth issue, which would afford Eldridge no greater relief.
Eldridge contends in its fifth issue that the trial court erred in denying its motion for directed verdict on LCM's breach of contract, breach of the covenant of quiet enjoyment, and constructive eviction claims because the evidence conclusively shows that Eldridge did not breach the leases. --------
Conclusion
We reverse the trial court's judgment, render judgment that LCM take nothing on its claims against Eldridge, and remand for a new trial on Eldridge's claims.
Rebeca Huddle
Justice Panel consists of Justices Higley, Huddle, and Lloyd.