Appeal No CV IN THE COURT OF APPEALS FIFTH JUDICIAL DISTRICT DALLAS, TEXAS. DEAN A. SMITH SALES, INC. DBA THE DEAN GROUP, Appellant

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1 Appeal No CV ACCEPTED 225EFJ FIFTH COURT OF APPEALS DALLAS, TEXAS 12 January 24 A12:33 Lisa Matz CLERK IN THE COURT OF APPEALS FIFTH JUDICIAL DISTRICT DALLAS, TEXAS DEAN A. SMITH SALES, INC. DBA THE DEAN GROUP, Appellant v. METAL SYSTEMS, INC., Appellee On Appeal from Cause No st Judicial District of Collin County, Texas The Honorable Mark Rusch, Presiding APPELLANT S BRIEF Brent A. Devere (Lead Counsel) Andrew Traub Attorney at Law Attorney at Law SBN SBN West Avenue, Suite # Wood Hollow Drive Austin, Texas Austin, Texas Tel: Tel: Fax: Fax: BDevere@1411west.com Andrew@attorney-austin.com Counsel for Appellant Dean A. Smith Sales, Inc. D/B/A The Dean Group ORAL ARGUMENT REQUESTED i

2 IDENTITY OF PARTIES AND COUNSEL The following is a list of all parties to the trial court s judgment in connection with the appeal in this cause: Appellant: Dean A. Smith Sales, Inc. D/B/A The Dean Group Appellee: Metal System, Inc. Appellant s Counsel: Brent A. Devere (Lead Counsel) Andrew Traub Attorney at Law Attorney at Law Texas Bar No Texas Bar No West Avenue, Suite # Wood Hollow Drive, Suite #200 Austin, Texas Austin, Texas Ph: Ph: Fax: Fax: BDevere@1411west.com Andrew@attorney-austin.com Appellee s Counsel: D. Scott Curry Allen J. Landerman Attorney at Law Attorney at Law Texas Bar No Texas Bar No E. Grauwyler Road 6211 W. Northwest Hwy Irving, Texas Dallas, Texas Ph: Ph: Fax: dscottcurrylaw@aol.com ii

3 TABLE OF CONTENTS IDENTITY OF PARTIES AND COUNSEL.ii INDEX OF AUTHORITIES...iv STATEMENT OF THE CASE...vi ISSUES PRESENTED viii STATEMENT OF FACTS.2 SUMMARY OF THE ARGUMENT.5 ARGUMENT...7 I. The Trial Court erred in granting a Traditional Motion for Summary Judgment on the commission and contract claims by improperly ruling the Real Estate License Act applied as a matter of law II. III. The Trial Court erred in granting a Traditional Motion for Summary Judgment for breach of oral contract...13 The Trial Court erred in granting a No Evidence Motion for Summary Judgment for breach of written contract 14 CONCLUSION AND PRAYER...18 CERTIFICATE OF SERVICE...20 APPENDIX A. Judgment (CR 342). B. Listing Agreement (CR ). C. Affidavit of Dean A. Smith (CR ). D. Tex. Occ. Code Ann , et seq) (Vernon 2004) The Real Estate Licensing Act (partial excerpt of statute- the complete statute is over 80 pages). E. Texas Business & Commerce Code Ann 26.01(b)(6) (Vernon 2009). iii

4 INDEX OF AUTHORITIES CASES BBQ Blues Texas, Ltd., v. Affiliated Business Brokers, Inc., 183 S.W.3d 543, 545 (Tex. App. -- Dallas 2006, pet. denied). 13 Evans v. Prufrock Restaurants, Inc., 757 S.W.2d 804 (Tex. App. -- Dallas 1988, writ denied) 10,11 Engel v. Teleprompter Corp., 703 F.2d 127, 131 (5th Cir. 1983) Graf v. Choudhury, 2002 Tex. App. LEXIS 7671 (Tex. App. Dallas 2002, no pet.) (not designated for publication)...9 Hall v. Hard, 335 S.W.2d 584, 590 (Tex. 1960)..9,10 Jackson v. Fiesta Mart, Inc., 979 S.W.2d 68, (Tex. App. -- Austin 1998, no pet.)...15 Joe v. Two Thirty Nine Joint Venture, 145 S.W.3d 150, 156 (Tex. 2004)....7 Merrell Dow Pharms., Inc. v. Havner, 953 S.W.2d 706, 711 (Tex. 1997) Moriarty v. Malcolm Pirnie, Inc., 2010 Tex. App. LEXIS 2205 (Tex. App. -- Austin 2010, no pet.)...7 Petras v. Criswell, 248 S.W.3d 471 (Tex. App. -- Dallas 1988, no pet.)..15 Rogers v. Wolfson, 763 S.W.2d 922, 925 (Tex. App. -- Dallas 1989, writ denied)...12 Wal-Mart Stores, Inc. v. Rodriguez, 92 S.W.3d 502, 506 (Tex. 2002) Woodruff v. Wright, 51 S.W.3d 727, 734 (Tex. App. -- Texarkana 2001, pet. denied)...14 iv

5 STATUTES Tex. Occ. Code Ann , et seq) (Vernon 2004) The Real Estate Licensing Act..3,4,5,6,7,8,9,10,13 Texas Business & Commerce Code Ann 26.01(b)(6) (Vernon 2009)... 6,13 RULES TRCP 166 (a)(c) 7 TRCP 166 (a)(i)...14 v

6 STATEMENT OF THE CASE Nature of the Case: This case is a suit for the recovery of a business broker commission by Appellant, Dean A. Smith Sales, Inc. D/B/A The Dean Group, in connection with the efforts of Appellant to market and sell the business of Appellee, Metal Systems, Inc.. Trial Judge: The Honorable Mark Rusch 401 st Judicial District Court of Collin County, Texas Course of Proceedings: Dean A. Smith Sales, Inc. D/B/A The Dean Group filed suit against Metal Systems, Inc. in order to recover an unpaid business brokerage commission based on the theories of breach of written contract, breach of oral contract, quantum meruit, and reformation of contract. Appellant s Third Amended Petition was the live pleading in this case (CR ). The lawsuit was originally filed in Travis County but as a result of a Motion to Transfer Venue, the Travis County Court ordered the case transferred to Collin County (CR 11-14, 74). Metal Systems, Inc. subsequently sought a traditional summary judgment primarily on the theory that the failure of Dean A. Smith Sales, Inc. to possess a Texas Real Estate License precluded the recovery of a commission in light of the fact that the listing agreement did not comply with the accompanying provision in the Texas Occupational Code. Metal Systems, Inc. further argued that Appellant was not entitled to recovery under contract and quantum meruit in light of the applicability of The Real Estate License Act (CR ; App. D). Metal Systems, Inc. next filed a supplement to the traditional motion for summary judgment whereby it further argued that The Real Estate License Act and vi

7 the statute of frauds precluded any recovery under oral contract (CR ; App. D & E). Finally, Metal Systems, Inc. filed a no evidence summary judgment motion on the grounds that there was no evidence of a contract and no evidence of a quantum meruit claim (CR ). Trial Court Disposition: The trial court granted Appellee s Traditional Motion for Summary Judgment and Appellee s No-Evidence Motion for Summary Judgment with regards to the written and oral contract claims of Appellant, thereby dismissing said claims (CR 342; App. A). It is this summary judgment order that that is the basis of the appeal. However, the trial court denied both Appellee s Traditional Motion for Summary Judgment and Appellee s No Evidence Motions for Summary Judgment with regards to the quantum meruit claim of Appellant (CR 342; App. A). Appellant subsequently voluntarily nonsuited the remaining quantum meruit cause of action in order to render the summary judgment order final for the purposes of this appeal (CR , ). vii

8 ISSUES PRESENTED FOR REVIEW 1. The trial court erred in granting a Traditional Motion for Summary Judgment and dismissing the claims of Appellant for recovery of a commission and breach of written contract by improperly concluding that Appellant failed to raise a genuine issue of material fact with regards to the applicability of The Real Estate License Act to the underlying commission dispute. 2. The trial court erred in granting a Traditional Motion for Summary Judgment in connection with the claim of Appellant for breach of oral contract by improperly concluding that Appellant failed to raise a genuine issue of material fact with regards to the applicability of The Real Estate License Act and the Statute of Frauds. 3. The trial court erred in granting a No-Evidence Motion for Summary Judgment in connection with the claims of Appellant for breach of contract by improperly concluding that Appellant failed to raise a genuine issue of material fact with regards to its contract claim. viii

9 Appeal No CV IN THE COURT OF APPEALS FIFTH JUDICIAL DISTRICT DALLAS, TEXAS DEAN A. SMITH SALES, INC. DBA THE DEAN GROUP, Appellant v. METAL SYSTEMS, INC., Appellee On Appeal from Cause No st Judicial District of Collin County, Texas The Honorable Mark Rusch, Presiding APPELLANT S BRIEF TO THE HONORABLE COURT OF APPEALS: Appellant, Dean A. Smith Sales, Inc. D/B/A The Dean Group, submits its brief in connection with the appeal of the summary judgment order signed by the trial court. 1

10 STATEMENT OF FACTS The underlying lawsuit, as alleged in Appellant s Third Amended Petition, is a suit for the recovery of a business broker commission under the theories of written contract, oral contract, reformation and quantum meruit in connection with the efforts by Appellant to sell the business of Appellee (CR ). Appellant was a business broker and alleges that it entered into both a written and oral listing agreement with Appellee whereby Appellee agreed to pay a brokerage commission to Appellant for the purposes of procuring a buyer for Appellee s business (CR ). The record is clear that both parties entered into discussions and negotiations and exchanged at least one draft of a written listing agreement (CR , , ; App. B & C). Moreover, there is evidence that there was at least one written listing agreement signed by both Appellant and Appellee (CR , , ; App. B). Appellant relied on the listing agreement and subsequently expended time and effort to market the business of Appellee (CR ; App. C). 2

11 Appellant further alleged that during the period of the listing agreement Appellee breached the listing agreement when Appellee thwarted efforts by Appellant to market the business; ultimately, Appellee attempted to terminate the listing agreement prior to its expiration (CR , ; App. C). There is even evidence that Appellee actually entered into direct negotiations with one of the prospects of Appellant just as Appellee attempted to withdraw from the listing contract so as to sidestep the need to tender a commission (CR , ; App. C). In either case, Appellant alleges that Appellee is primarily liable for breach of oral contract as well as breach of the written listing agreement (CR ). Appellee subsequently filed both a No-Evidence and Traditional Motion for Summary Judgment (including a First Supplement to Traditional Motion for Summary Judgment) against Appellant. (CR , , ). The trial granted both summary judgments motions in part and thereby dismissed all claims for written and oral contract (CR 342; App. A). The Traditional Motion for Summary Judgment was based primarily on the theory that the absence of a real estate license precluded Appellant from recovery under The Real Estate License Act (CR , ). Apparently, the trial court also granted the 3

12 First Supplement to Traditional Motion for Summary Judgment and thereby dismissed the oral contract claim. However, the trial court did not dismiss the claims of Appellant for quantum meruit or reformation (CR 342; App. A). The trial court likewise granted Appellee s No Evidence Motion for Summary Judgment and concluded that there was no evidence to support a written contract wholly independent of The Real Estate License Act (CR , 342; App. A). Finally, Appellee also filed a Second Traditional Motion for Summary Judgment against the remaining quantum meruit and reformation claims whereby it attempted to primarily argue the Texas Securities Act precluded recovery of the remaining claims (CR ). However, this motion was never ruled upon by the trial court in light of the order of nonsuit and is therefore not applicable to this appeal (CR ). Appellant subsequently nonsuited without prejudice the remaining reformation and quantum meruit claims so as to render the summary judgment order final for the purposes of this appeal (CR , ). 4

13 SUMMARY OF THE ARGUMENT The trial court erred in granting both the traditional motion for summary judgment (including the first supplement to the traditional motion for summary judgment) and the no evidence motion for summary judgment in connection with the claims by Appellant for breach of written and oral contract. With regards to the traditional motion for summary judgment and first supplement, there is ample evidence in the record that The Real Estate License Act (Texas Occupation Code Ann , et seq) (Vernon 2004) (App. D) was not applicable to the underlying transaction. At the very least, a material fact issue existed as to whether the underlying business owned real estate, and therefore whether or not any resulting commission would be based on any sale of real estate. Moreover, the written listing agreement, that is in large part the basis of the lawsuit, specifically incorporated a severance clause that would render the contract enforceable to the extent that any other portion might somehow be invalid. Finally, there is also considerable evidence in the record that an eventual sale of the business would be structured as a stock sale. In light of the fact that stock is personal property under Texas law, the Texas Real Estate Licensing Act would therefore not be applicable. 5

14 If the Texas Real Estate Licensing Act is not applicable to this case, then the claims of Appellant for breach of oral and written contract would remain viable. With regards to the claim for oral contract, there is evidence in the record that the listing agreement was to be performed in under one year, thereby removing the oral contract from the requirement of the statute of frauds. See Texas Business & Commerce Code Ann 26.01(b)(6) (Vernon 2009) (App. E). Moreover, the written listing agreement in all other respects easily supports a claim for breach of written contract. The written listing agreement was signed by all parties, describes the underlying business, and provides essential terms including default clause and a liquidated damage clause. Even the original Travis County trial court judge ruled that there was a written contract in her findings of fact and conclusions of law (requested by Appellee) at the Motion to Transfer Venue hearing. At the very least, a determination of the existence of a written contract was a fact issue that was not appropriate for summary judgment. Therefore, it was also improper for the trial court to also grant a No Evidence Motion for Summary Judgment. Appellant believes that this Court should reverse and remand the order granting both the Motion for Traditional Summary Judgment, including the First Supplement, and the No Evidence Motion for Summary Judgment. 6

15 ARGUMENT I. The trial court erred in granting the Motion for Traditional Summary Judgment by improperly concluding that the Texas Real Estate Licensing Act precluded a claim for written contract. The main issue in this case hinges on whether or not The Real Estate License Act applies to the underlying transaction so as to preclude recovery by Appellant on its claims for a commission and breach of contract. This Court should review the summary judgment de novo. See Joe v. Two Thirty Nine Joint Venture, 145 S.W.3d 150, 156 (Tex. 2004) and Moriarty v. Malcolm Pirnie, Inc., 2010 Tex. App. LEXIS 2205 (Tex. App. -- Austin 2010, no pet.). The standards for reviewing a traditional rule 166 (a)(c) motion for summary judgment are the following: (1) the movant must demonstrate that there is no genuine issue of material fact and that it is entitled to judgment as a matter of law; (2) the Court should take all evidence favorable to the non-movant as true in deciding whether a disputed issue of material fact exists that would preclude summary judgment; and (3) the Court should indulge every reasonable inference and resolve any doubts in favor of the non-movant. The Real Estate License Act only applies to a transaction that involves the sale or lease of real estate. The Real Estate License Act, in the context of real estate brokers, is codified in the Texas Occupation Code Ann , et seq) (Vernon 2004) and 7

16 applicable amendments (App. D). For the purposes of this brief, the foregoing statute will be referred to as The Real Estate Licensing Act (App. D). Section (1) of the Texas Occupation Code Ann. (Vernon 2004) in turn contains a long list of different activities that define a broker for the purposes of The Real Estate License Act (App. D). Specifically (1)(A) specifically defines a broker as one who either receives a commission or has an expectation of a commission in connection with the sale or lease of real estate (App. D). In this case, there was never a receipt of a commission for the sale or lease of real estate. Moreover, Appellant submitted the affidavit of Dean Smith, in Appellant s Summary Judgment Response, which clearly disavows any expected commission from the sale of real estate (CR paragraph #8; App. C). Most importantly, it is far from clear whether the written listing agreement contemplated the sale or lease of real estate (CR ; App. B). Although the signed listing agreement mentions real estate only in a generic sense as part of a long laundry list of items, Appellee failed to introduce any direct evidence in the record that Appellee even owned real estate, let alone that Appellant ever intended to receive a commission from the sale of real estate (CR ; App. B). 8

17 Texas case law, including cases from the Dallas Court of Appeals, has established that it is fundamentally a fact issue as to whether or not a potential real estate brokerage commission involves real estate. This Court affirmed a jury verdict that awarded damages in favor of a business broker even though the sale of a service station/convenience store clearly involved the sale of real estate and even though the Plaintiff did not possess a Texas real estate license. See Graf v. Choudhury, 2002 Tex. App. LEXIS 7671 (Tex. App. -- Dallas, 2002, no pet.) (not designated for publication). In fact, in Graf, the written listing agreement specifically even assigned a value to the land component of the business. Moreover, the ultimate sale of the business actually included real estate. The Graf opinion further concluded that it is fundamentally a fact question as to whether or not a listing contract encompasses real estate and whether or not The Real Estate License Act is applicable. See Graf v. Choudhury, 2002 Tex. App. LEXIS 7671, 7676 (Tex. App. -- Dallas, 2002, no pet.). Even the Texas Supreme Court has concluded that whether a brokerage commission involves the sale of real estate is a fact issue. See Hall v. Hard, 335 S.W.2d 584, 589 (Tex. 1960). 9

18 In Hall, after a business broker won a commission in a jury trial, the trial court granted a JNOV in favor of the Defendant/seller after determining that the Business broker lacked a real estate license and a securities license. The Court of Appeals reversed the JNOV and rendered in favor of the business broker. Ultimately, the Texas Supreme Court reversed the Court of Appeals and remanded after requiring further fact findings on whether or not real estate and/or securities was involved in the underlying transaction. Sales of Stock is Personal Property Even if for the sake of argument, the parties somehow contemplated real estate in the listing agreement, the fact that a sale could ultimately occur as a stock sale would nevertheless preclude the applicability of The Real Estate License Act (CR , , ; App. B & C & D). The case law is well established that even if the underlying business owns real estate, a sale of the stock in the business, all or in part, is the sale of personal property and not real estate. See Hall v. Hard, 335 S.W.2d 584, 589 (Tex. 1960). In fact, this Court reversed a summary judgment granted in favor of a seller in an oral commission broker dispute when it determined that there was a fact issue for the jury as to whether real estate was contemplated as part of a commission contract. See Evans v. Prufrock Restaurants, Inc., 757 S.W.2d 804 (Tex. App. -- Dallas, 1988, writ denied). 10

19 In Prufrock, the Appellant was a business broker who did not possess a real estate license. Even though the trial court granted summary judgment against the business broker in connection with its claim for a commission because the broker did not possess a real estate license, the Dallas Court of Appeals reversed and remanded after it concluded that the sale of the restaurants contemplated a stock sale. Therefore, The Real Estate License Act was not applicable. Even the United States Fifth Circuit has ruled that under Texas the sale of stock is personal property, notwithstanding the fact that the underlying business may own real estate. See Engel v. Teleprompter Corp., 703 F.2d 127, 131 (5th Cir. 1983) as also cited in Prufrock Evans, 757 S.W.2d at 806. There is ample evidence in the record that a stock transaction was in fact contemplated by the parties as provided in Appellant s Response to Appellee s Motion for Summary Judgment: 1. The affidavit of Dean Smith, in paragraph 8, explains the intended sale of the underlying business (as provided for in the listing agreement) contemplated a stock sale (CR ; App. C). 11

20 2. Appellant also provided a true and correct copy of a listing agreement executed by all parties (CR ; App. B). Paragraphs 12 and 13 specifically refer to a sale of capital stock. 3. Finally, in Appellee s own responses to Appellant s Request for Production, there is a lengthy stock purchase agreement (for the purchase of Appellee s business) provided by a prospective purchaser, Chris Gummer (CR ). Severance Clause and Reformation Even if one assumes that real estate was somehow contemplated in the underlying transaction, the presence of a severance clause in the written listing agreement would still enable Appellant to recover a commission to the extent any contemplated sale did not involve real estate. (CR paragraph #21; App. B). This Court reversed a summary judgment and determined that illegal provisions could be severed from the contract without invalidating the legal provisions. See Rogers v. Wolfson, 763 S.W.2d 922, 925 (Tex. App. -- Dallas 1989, writ denied). Appellant specifically sought reformation of the listing agreement in Plaintiff s Third Amended Petition so as to render the listing agreement enforceable irrespective of 12

21 any reference to real estate (CR ). Moreover, Appellant specifically raised the issues of severance and reformation in its Summary Judgment Response (CR 228). II. The trial court erred in granting the First Supplement to the Traditional Motion for Traditional Summary Judgment with regards to the claim for breach of oral contract. Appellant re-urges the arguments in the foregoing sections whereby The Real Estate License Act is not applicable to this transaction. Moreover, if The Real Estate License Act and the accompanying provisions in the Texas Occupational Code are not applicable, then it was improper for the Court to dismiss the claim for oral contract. See BBQ Blues Texas, Ltd., v. Affiliated Business Brokers, Inc., 183 S.W.3d 543, 545 (Tex. App. -- Dallas 2006, pet. denied). In so much as Appellee argues that the statute of frauds provision in Texas Business & Commerce Code Ann (b)(6) (Vernon 2009) (App. E) is applicable to the extent that the time for performance extends beyond one year, Appellant argues that the exact time frame of the listing agreement is uncertain and remains a fact issue; regardless, the time for performance is not believed to be in excess of one year (CR ; App. C). 13

22 III. The trial court erred in granting a No-Evidence Summary Judgment in connection with the claims of Appellant for breach of written contract. The record contains considerable evidence that a written listing agreement was signed by all parties which established all the requisite elements for a contract claim. Therefore, it was not proper for the trial court to rule as a matter of law that there was no written contract as a matter of law. A no evidence motion for summary judgment, as per TRCP 166 (a)(i), is reviewed under the same legal sufficiency standard for a no-evidence summary judgment that it would apply in evaluating a directed verdict. See Wal-Mart Stores, Inc. v. Rodriguez, 92 S.W.3d 502, 506 (Tex. 2002). The Court must determine whether the nonmovant produces any evidence of probative value which could raise a fact issue on the issues that are the basis of summary judgment motion. See Woodruff v. Wright, 51 S.W.3d 727, 734 (Tex. App. -- Texarkana 2001, pet. denied). The Court should consider the evidence in a light that is most favorable to the party against whom the no-evidence summary judgment seeks relief, and disregard all contrary evidence and inferences. See Merrell Dow Pharms., Inc. v. Havner, 953 S.W.2d 706, 711 (Tex. 1997). 14

23 A Court should not grant a no-evidence summary judgment if the nonmovant presents more than a scintilla of evidence which raises a genuine issue of material fact. See Jackson v. Fiesta Mart, Inc., 979 S.W.2d 68, (Tex. App. -- Austin 1998, no pet.). Elements of a Contract The law is well established that in order to prevail on a claim for breach of contract, Appellant must prove the following: (1) a valid contract; (2) performance or tendered performance by the plaintiff; (3) breach of the contract by the defendant; and damages sustained by the plaintiff as a result of that breach. See Petras v. Criswell, 248 S.W.3d 471 (Tex. App. - Dallas 1988, no pet.). a) Evidence of a contract record: In support of the existence of a contract, there is the following evidence in the 1. Affidavit from Dean Smith on behalf of Appellant in support of a listing Agreement (CR ; App. C). 15

24 2. A signed listing agreement that was executed by all parties (CR ; App. B). 3. Letters received by counsel for Appellant from counsel for Appellee. The communications from counsel for Appellee suggest the existence of a listing contract. In fact, if a contract did not exist, counsel for Appellee would not have had a reason to express concerns about the corporate status of Appellant (CR ). 4. Findings of Fact and Conclusions of Law issued by the original Travis County Judge at the request for Appellee in connection with the venue transfer hearing whereby she concluded the existence of a listing contract (CR ). b) Breach of Contract Assuming there was a contract and performance by Appellant, there is ample evidence that Appellee breached the listing contract: 1. Specifically, the following paragraphs from the signed listing contract are relevant (CR ; App. B): 16

25 Paragraph 11 reads as follows: The commission described in Paragraph 10 shall be earned by and payable to broker, in cash, upon the occurrence of any of the following events: C. Seller violates the terms of this Agreement and/or breaches any material warranty or representation made herein, or withdraws the Business from the market and/or otherwise attempts to terminate this Agreement prior to its expiration date. 2. Appellant also directs the Court to paragraph #6 of the Affidavit of Dean Smith whereby he indicated that the owner of Appellee, Walter Boudoin, refused to cooperate in efforts to sell the business (CR ; App. C). 3. Appellant also offers the letters from Counsel for Appellee which easily support a fact issue that Appellee attempted to terminate the contract. Specifically, counsel for Appellee appears to have been attempting to end the listing agreement and even provided a termination agreement (CR ). c) Damages In the context of damages, Appellant directs the Court to Paragraph #27 of the listing contract which contains a liquidated damage clause (CR ; App. B): Any breach or failure to fulfill the terms or conditions of this Agreement by Seller, including but not limited to withdrawal of the Business from the market by Seller or 17

26 Seller s failure to cooperate with Broker in marketing the business for sale, will be considered a substantial breach of this Agreement it is agreed that Broker will be substantially damaged by Seller s breach and that considering the precise damages are difficult to calculate, Seller agrees to pay Broker the sum of 50% of the commission for such breach as liquidated damages. Therefore, the liquidated damage clause provides a specific remedy for damages. In short, there are strong fact issues in favor of Appellant in support of its claim for breach of contract. It was therefore reversible error for the trial court to conclude as a matter of law that there was no viable claim for breach of contract. CONCLUSION AND PRAYER In sum, the trial court improperly granted the Traditional (including the First Supplement) and No Evidence Motions for Summary Judgment in connection with the claims for written and oral contract. The record contains considerable evidence that The Real Estate Licensing Act did not apply to the underlying business broker listing agreement. At the very least, there are fact issues as to whether or not real estate was contemplated by both parties in 18

27 in the transaction. In addition, the severance clause in the contract would preserve the right of Appellant to pursue it claim irrespective of any real estate component. Moreover, to the extent that any resulting sale would involve a stock sale, The Real Estate Licensing Act would be inapplicable even if real estate were included in the underlying transaction. In addition, there is ample evidence that Appellant satisfied the elements for breach of oral and written contract. WHEREFORE Appellant, Dean A. Smith Sales, Inc. D/B/A The Dean Group, respectfully requests that this Court reverse the trial court s judgment, and that the case be remanded for a new trial. Appellant prays for other and further relief to which it may be justly entitled. Respectfully submitted, /s/ Brent A. Devere Brent A. Devere, Attorney at Law Texas Bar No West Avenue, Suite #200 Austin, Texas Tel. (512) Fax. (512) BDevere@1411west.com 19

28 Andrew Traub SBN# Wood Hollow Drive, Suite #200 Austin, Texas Ph: Fax: ATTORNEYS FOR APPELLANT, Dean A. Smith Sales, Inc. D/B/A The Dean Group CERTIFICATE OF SERVICE Under Texas Rule of Appellate Procedure 9.2 and Local Rule 3, I certify that a copy of this brief was filed through the electronic filing system. Under Texas Rule of Appellate Procedure 9.5, I further certify that a copy of this brief was served on January 24, 2012 upon the following counsel for Appellee via Facsimile on or before 5:00 P.M.: D. Scott Curry VIA FAX: E. Grauwyler Road Irving, Texas Ph: Fax: By: /s/ Brent A. Devere Brent A. Devere 20

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