Butler v. Hudson & Keyse LLC (Tex.App.- Houston [14th Dist.] Feb. 19, 2009) (Hudson)
credit card debt suit, account stated theory)
AFFIRMED: Opinion by Justice Hudson  
Before Justices Anderson, Hudson and Frost
14-07-00534-CV Paul A. Butler and Afton J. Butler v. Hudson & Keyse, L.L.C
Appeal from County Civil Court at Law No 1 of Harris County
Trial Court
Judge: R. Jack Cagle  

M E M O R A N D U M   O P I N I O N

This is an appeal from a judgment entered against appellants Paul and Afton Butler in a credit
card debt collection suit.  Hudson & Keyse, L.L.C. (“Hudson") sued the Butlers to recover the
$21,803.54 balance owed on a credit card, as well as $6,541.06 in attorney's fees.  Hudson
moved for summary judgment on its claim, and the trial court granted the motion.  On appeal, the
Butlers contend there is  insufficient evidence to support summary judgment, and that genuine
issues of material fact exist.  We affirm.  


Chase Manhattan Bank (“Chase"), Hudson's assignor, issued the credit card to the Butlers, who
used it for purchases and cash advances.  The Butlers, it is claimed, incurred $21,803.54 in
credit card debt.  After acquiring the right to collect on the debt from Chase, Hudson brought suit
against the Butlers.  Hudson then moved for summary judgment, supported by affidavits from
Nancy Quere, Hudson's legal account manager, and its attorney, Dan G. Young.  Quere's affidavit
provides that the Butlers are obligated to pay the amount of $21,803.54 to Hudson, as Chase's
assignee.  Young's affidavit sets forth the amount of attorney's fees incurred as $6,541.06, and in
it Young explains the basis for the claimed amount.

The Butlers filed a verified response to the motion for summary judgment claiming genuine issues
of material fact had not been resolved.  They argued they did not owe Hudson a debt, and they
raised the affirmative defenses of lack of privity of contract, statute of limitations, failure and/or
lack of consideration, illegality, payment, unenforceability, usury, laches, and estoppel.  They
asserted Quere's affidavit did not establish a basis for Hudson's allegations, and that the
allegations made were conclusory.  Finally, the Butlers contended Hudson had failed to produce
documentary evidence showing it was entitled to collect on the debt as Chase's assignee.

The only summary-judgment evidence provided by the Butlers was a complaint and notice of a
class action suit filed in federal court against Hudson.  The complaint alleged violations of the Fair
Debt Collection Practices Act and the Texas Debt Collection Act.  Mr. Butler received notice of
the class action as a potential class member.  Appellants argued Mrs. Butler should have been
dismissed as a defendant from this credit-card case because she was not served with notice as
a member of the class action.  They also claimed, because Mrs. Butler was not given notice of the
class action, no contractual relationship existed between her and Hudson.  The trial court granted
summary judgment, and the Butlers have appealed.

Standard of Review

The standard for reviewing the granting of a motion for summary judgment is well established.  A
plaintiff moving for summary judgment has the burden of proving there is no genuine issue of
material fact and that it is entitled to judgment as a matter of law on each element of the cause of
action.  See Rhone-Poulenc, Inc. v. Steel, 997 S.W.2d 217, 222 (Tex. 1999); Nixon v. Mr. Prop.
Mgmt. Co., 690 S.W.2d 546, 548 (Tex. 1985); Gibbs v. Gen. Motors Corp., 450 S.W.2d 827, 828
(Tex. 1970).  Evidence favorable to the non-movant will be taken as true in deciding whether there
is a disputed material fact issue that precludes summary judgment.  Nixon, 690 S.W.2d at 548-
49.  We make all reasonable inferences in the non-movant's favor.  See KPMG Peat Marwick v.
Harrison County Hous. Fin. Corp., 988 S.W.2d 746, 748 (Tex. 1999).  If the movant's motion and
summary judgment proof facially establish its right to judgment as a matter of law, the burden
shifts to the non-movant to raise a material fact issue sufficient to defeat summary judgment.  See
HBO, A Div. of Time Warner Entm't Co. v. Harrison, 983 S.W.2d 31, 35 (Tex. App.- Houston [14th
Dist.] 1998, no pet.).  However, a non-movant is not required to respond with evidence if
deficiencies in the movant's own proof or legal theories will defeat the movant's right to judgment
as a matter of law.  See City of Houston v. Clear Creek Basin Auth., 589 S.W.2d 671, 678 (Tex.


A.  Summary Judgment Evidence

A party is entitled to relief under the common-law cause of action for “account stated" if the party
proves (1) transactions between the parties give rise to indebtedness of one to the other; (2) an
agreement, express or implied, between the parties fixes an amount due; and (3) the one to be
charged makes a promise, express or implied, to pay the indebtedness.  Neil v. Agris, 693 S.W.
2d 604, 605 (Tex. App.- Houston [14th Dist.] 1985, no writ); Cont'l Cas. Co. v. Dr Pepper Bottling
Co. of Texas, 416 F. Supp. 2d 497, 504 (N.D. Tex. 2006) (citing Arnold D. Kamen & Co. v.
Young, 466 S.W.2d 381, 388 (Tex. App.- Dallas 1971, writ ref'd n.r.e.)).  

A claim for account stated differs from a suit on a sworn account, which requires personal
property or services be provided by the creditor to the debtor.[1]  See Tex. R. Civ. P. 185; see
also Tully v. Citibank (South Dakota), N.A., 173 S.W.3d 212, 216 (Tex. App.- Texarkana 2005, no
pet.).  Account stated, and not a suit on a sworn account, is the proper cause of action for a credit
card collection because no title to personal property or services pass from the bank to the credit
card holder.  Tully, 173 S.W.3d at 216; Bird v. First Deposit Nat'l Bank, 994 S.W.2d 280, 282
(Tex. App.- El Paso 1999, pet. denied).

1.  Transactions Giving Rise to Indebtedness

Hudson provided summary-judgment evidence showing that transactions between the parties
gave rise to the indebtedness.  Specifically, Quere's affidavit provides the indebtedness arose
from a credit card issued to the Butlers by Chase.  The affidavit also explains that Chase
assigned the right to collect on the debt to Hudson.  The Butlers argue that Quere's affidavit is not
based on personal knowledge of the books and records of Chase.  See Tex. R. Civ. P. 166a(f).

However, an objection that the affiant does not have personal knowledge is an objection to the
form of the affidavit and must be preserved in the trial court.  Grand Prairie Indep. Sch. Dist. v.
Vaughan, 792 S.W.2d 944, 945 (Tex. 1990).  Nothing in the record shows the trial court ruled on
the Butlers' objections before rendering judgment.  Therefore, the objection to Quere's personal
knowledge has been waived.  See id.

Next, appellants contend the statements made in the affidavit are conclusory, but do not identify
the complained-of statements.  An objection regarding the conclusory nature of an affidavit is an
objection to the substance of the affidavit that can be raised for the first time on appeal.  Skelton
v. Comm'n for Lawyer Discipline, 56 S.W.3d 687, 692 (Tex. App.- Houston [14th Dist.] 2001, no
pet.).  Affidavits which contain conclusory statements that fail to provide the underlying facts to
support the conclusion are not proper summary judgment evidence.  Dolcefino v. Randolph, 19 S.
W.3d 906, 930 (Tex. App.- Houston [14th Dist.] 2000, pet. denied).  However, Quere's affidavit is
not conclusory.  The affidavit states that plaintiff purchased the debt from Chase.  It also contains
assertions supporting Hudson's motion and it is based on the affiant's personal knowledge
derived from her work as Hudson's legal account manager.  We conclude Quere's affidavit is not
conclusory and the trial court did not err in considering it.  Thus, Hudson effectively established the
first element of its account stated claim.

2.  Implied Agreement Fixing Amount Due, and Implied Promise to Pay

Appellants argue Hudson's summary-judgment evidence failed to establish the Butlers had a
contractual agreement with Chase or Hudson.  Because an account stated claim can be based
on an express or implied agreement, Hudson does not have to produce a written contract as long
as it provides other evidence of the agreement between the parties to meet its burden of proof.  
See Neil, 693 S.W.2d at 605.  An implied agreement can arise from the acts and conduct of the
parties.  Harrison v. Williams Dental Group, P.C., 140 S.W.3d 912, 916 (Tex. App.- Dallas 2004,
no pet.).  Given the Butlers' acceptance and use of the credit card to make purchases, it is
reasonable to infer that they understood and accepted the obligation, and impliedly promised to
pay the indebtedness.  See Hinojosa v. Citibank (South Dakota), N.A., No. 05-07-00059-CV,
2008 WL 570601, at *3 (Tex. App.- Dallas March 4, 2008, pet. denied) (mem. op.).  

The Butlers contend Hudson failed to prove a fixed amount owed on the credit card account.  
However, Quere attested that the Butlers owe a balance of $14,931.13, with  $6,872.41 interest,
for a total of $21,803.54.  Again, based on appellants' usage of the credit card, we may
reasonably infer that they impliedly agreed to pay a fixed amount equal to the purchases and cash
advances they made, plus interest.  See Dulong v. Citibank (South Dakota), N.A., 261 S.W.3d
890, 894 (Tex. App.- Dallas 2008, no pet.).  The Butlers have not presented any evidence
suggesting a different amount is owed.  Thus, the evidence presented by Hudson established that
the Butlers agreed to pay the fixed amount of indebtedness arising out of their credit-card

Appellants also claim they are not obligated to pay Hudson on the indebtedness because it failed
to show it was entitled to bring suit as Chase's assignee.  Hudson's  summary-judgment evidence
shows Hudson has the right to bring suit on the debt.  The Butlers did not attach any evidence to
their verified response in support of their assertion.  The Butlers failed to raise an issue of
material fact on this point.

Further contesting the existence of contractual relationship, the Butlers attached a class-action
complaint against Hudson to their supplemental response, as well as a copy of the notice Mr.
Butler received as a potential class member.  The Butlers claim this evidence proves that Mrs.
Butler had not entered into a contractual relationship with Chase because she was not personally
served with notice and a copy of the complaint.  However, because appellant's brief cites no
authority and provides no argument in support of this contention, it presents nothing for our review
and is waived.  See Tex. R. App. P. 38.1(i); San Saba Energy, L.P. v. Crawford, 171 S.W.3d 323,
338 (Tex. App.- Houston [14th Dist.] 2005, no pet.).           

Appellants also assert Hudson represented to the federal court that its net worth was only
$76,055.05.  The Butlers argue that it is inconceivable they owe Hudson one-third of its net worth.  
Were we to construe this non-sequitur as a challenge to the amount of the debt, the argument still
fails because appellants misread their own summary-judgment evidence.  According to the
record, $76,055.05 represents only one percent of Hudson's net worth which, according to the
complaint, is the maximum amount of statutory damages recoverable in the class-action suit.  The
second and third elements of the account stated claim are satisfied by Hudson's summary
judgment evidence and appellants have not raised a material fact issue.

3. Appellants' Affirmative Defenses

In support of their claim that material fact issues remain unresolved by the trial court, the Butlers
contend they raised affirmative defenses that have not been addressed.  However, the mere
pleading of an affirmative defense will not, without proof, defeat a motion for summary judgment.  
American Petrofina, Inc. v. Allen, 887 S.W.2d 829, 830 (Tex. 1994); Kehoe v. Lambert, 633 S.W.
2d 576, 578 (Tex. App.- Houston [14th Dist.] 1982, writ ref'd n.r.e.).  A defendant must go beyond
the allegations of an affirmative defense and present summary judgment evidence that
establishes the defense.  See Brownlee v. Brownlee, 665 S.W.2d 111, 112 (Tex. 1984).  If the
affirmative defense has more than one element, then summary judgment evidence must be
presented on each element necessary to such defense.  Rucker v. Bank One Texas, N.A., 36 S.W.
3d 649, 653 (Tex. App.- Waco 2000, pet. denied).  The Butlers failed to produce evidence in
support of the affirmative defenses asserted.  Therefore, the trial court properly disregarded such
affirmative defenses.

We conclude Hudson established the elements of the account-stated claim as a matter of law.  
The Butlers had an implied agreement with Chase fixing an amount due, and, as Chase's
assignee, Hudson is entitled to recover the unpaid sums. Once Hudson established the elements
of its claim, the burden shifted to the Butlers to raise a material fact issue sufficient to defeat the
motion for summary judgment.  The Butlers did not meet this burden because they did not offer
any evidence giving rise to a material fact issue.

B. Attorney's Fees

The trial court awarded Hudson $6,541.06 in attorney's fees, plus conditional attorney's fees of
$1,500 in the event of appeal to the Texas Court of Appeals, and $2,500 in the event a petition for
review is filed with the Texas Supreme Court.  Hudson's attorney, Dan G. Young, filed an affidavit
explaining that the amount of attorney's fees requested by Hudson is reasonable considering the
services rendered and the contingency fee nature of the suit.  On appeal, the Butlers argue
Hudson failed to establish the attorney's fees awarded are just and reasonable.  Specifically, they
point out the affidavit did not provide an hourly fee and it did not provide a basis in law for the
collection of fees from the Butlers.  

“The award of attorney's fees in a summary judgment is improper unless the evidence of the
reasonableness of those fees is uncontroverted."  Guity v. C.C.I. Enter., Co., 54 S.W.3d 526, 528
(Tex. App.- Houston [1st Dist.] 2001, no pet.).  Uncontroverted testimony of an interested witness
will establish attorney's fees sought are reasonable and necessary as a matter of law if the
following conditions exist: (1) the testimony could readily be contradicted if untrue; (2) the
testimony is clear, direct, and positive; and (3) there are no circumstances tending to discredit or
impeach the testimony.  Rosenblatt v. Freedom Life Ins. Co. of Am., 240 S.W.3d 315, 321 (Tex.
App.- Houston [1 Dist.] 2007, no pet.) (citing Ragsdale v. Progressive Voters League, 801 S.W.
2d 880, 882 (Tex. 1990).  Young's affidavit clearly and directly states the amount of attorney's fees
sought.  Because the Butlers did not present a conflicting affidavit or any other evidence
challenging the reasonableness of the attorney's fees, it was uncontroverted.  Thus, the attorney's
fees were properly awarded to Hudson.  


After considering the arguments presented, we overrule the points raised and affirm the trial
court's summary judgment.

/s/      J. Harvey Hudson

Senior Justice

Panel consists of Justices Anderson and Frost, and Senior Justice Hudson.*

[1]  Appellants note in their brief that Hudson's petition was not verified.  A plaintiff's petition on sworn account must contain
a systematic, itemized statement of the services rendered, reveal offsets made to the account, and be supported by an
affidavit stating the claim is within the affiant's knowledge and that it is “just and true." Tex. R. Civ. P. 185; see also Andrews
v. E. Tex. Med. Ctr.-Athens, 885 S.W.2d 264, 267 (Tex. App.CTyler 1994, no writ).  If there is a deficiency in the plaintiff's
sworn account, the account will not constitute prima facie evidence of the debt. See Enernational Corp. v. Exploitation
Eng'rs, Inc., 705 S.W.2d 749, 750 (Tex. App.- Houston [1st Dist.] 1986, writ ref'd n.r.e.).  Given that Hudson did not file a
petition on sworn account, its failure to attach an affidavit to the petition is immaterial to our review.

*  Senior Justice Harvey Hudson sitting by assignment.