General Metal Fabricating, Inc., GMF Leasing, Inc. v. Stergiou
(Tex.App.- Houston [1st Dist.] Nov. 5, 2009)(Hanks) (Court lacks jurisdiction over this case because the order
entitled "Final Judgment" in the underlying suit was, in fact, interlocutory)
DISMISS APPEAL 9/5: Opinion by Justice Hanks
Before Justices Keyes, Alcala and Hanks
01-08-00921-CV General Metal Fabricating, Inc., GMF Leasing, Inc., and Arnold Curry v. John Stergiou and
Main Marine Repair and Industrial Cleaning, Co.
Appeal from 133rd District Court of Harris County
Trial Court Judge: Hon. Lamar McCorkle
Appellees/Cross-Appellants, John Stergiou and Main Marine Repair and Industrial Cleaning Company
(collectively, "Stergiou"), moved to dismiss the appeal of General Metal Fabricating, Inc., GMF Leasing Inc.,
and Arnold Curry (collectively, "the GMF Parties") for lack of jurisdiction. After due consideration, we conclude
that this Court lacks jurisdiction over this case because the order entitled "Final Judgment" in the underlying
suit was, in fact, interlocutory. We therefore dismiss both the appeal filed by the GMF Parties and the appeal
filed by Stergiou.
Arnold Curry is the president of General Metal Fabricating Corporation and GMF Leasing, Inc. Prior to the
formation of these two companies, John Stergiou, the corporations' secretary, agreed that he would loan
funds to the corporations and act as the guarantor of these loans. In return, Stergiou would receive half of the
corporations' stock shares. Curry was to receive the other half of the shares. Once the corporations had
accrued adequate capital, the corporations were to repay Stergiou for the loans, Stergiou was to be released
from his duties as guarantor, and Stergiou was to return the stock shares to Curry.
After two and a half years of successful operation, the corporations repaid Stergiou for the loans and
released him from his guaranty. However, a dispute arose over the return of the stock, and Stergiou did not
return the shares. Consequently, Curry and the corporations sued Stergiou for breach of contract and breach
of fiduciary duty.
The case was tried, appealed, reversed and remanded, and tried again. During the second trial, the GMF
Parties and Stergiou attempted to settle the case by drafting a Rule 11 Agreement. The specific details of the
Rule 11 Agreement were contingent upon jury answers. After the jury returned the verdict, the parties could
not come to an agreement consummating the Rule 11 Agreement. Stergiou contended that the Rule 11
Agreement was an unenforceable "agreement to agree," while the GMF Parties asserted that it was an
enforceable agreement. Subsequently, Stergiou filed a supplemental pleading asserting counterclaims
against the GMF Parties for--among other things--a declaration that the Rule 11 Agreement was not
enforceable, breach of contract, breach of warranty, fraud, failure to produce books and records, negligent
misrepresentation, and negligence. Stergiou moved for summary judgment only on his claim seeking a
declaration that the Rule 11 Agreement was not enforceable. The GMF Parties filed an opposing motion for
summary judgment seeking a declaration that the agreement was enforceable.
Subsequent to the filing of these motions, the GMF Parties filed a "Supplemental Pleading to Plaintiffs
Amended Post Trial Petition," asserting a claim against Stergiou for specific performance of the Rule 11
agreement. The GMF Parties also filed a second motion for summary judgment on this claim for specific
performance arguing that the GMF Parties had fully performed the Rule 11 agreement with Stergiou by
tendering to him $300,000 and that this tender obligated Stergiou to return his stock certificates.
On September 29, 2008, the trial court entered two orders, one titled "Judgment" and the other titled "Final
Judgment." Although these orders specifically identify and reference Stergiou's motion for summary judgment
and the GMF Parties' first motion for summary judgment, neither order identifies or references the second
motion for summary judgment filed by the GMF Parties. The first order states in relevant part
BE IT REMEMBERED that on this date the Court considered the Motion for Judgment to Declare the Rule 11
Agreement Enforceable by summary means sought by GENERAL METAL FABRICATING, INC., GMF
LEASING, INC., and ARNOLD CURRY, Plaintiffs Cross-Defendants. The court after giving due consideration
to the pleadings, summary judgment evidence and applicable law concludes that an appropriate Judgment
should be granted.
(Emphasis added.) The second order states in relevant part:
BE IT REMEMBERED that on this date the Court considered the Motion for Final Judgment by summary
means sought by John Stergiou and Main Marine Repair and Industrial Cleaning Co., Defendants/
Cross-Plaintiffs and the Motion for Summary Judgment to declare the rule 11 Agreement Enforceable by
summary means sought by General Metal Fabricating, Inc., GMF Leasing, Inc., and Arnold Curry, Plaintiffs/
Cross-Defendants. The underlying facts show:
In its most basic terms the issues presented arise from an alleged breach of a Rule 11 Agreement. While the
jury was deliberating the verdict in this cause, the parties began negotiations to enter into a Rule 11
Agreement that would have been an alternate to entry of judgment. The Parties and Counsel dictated the
terms of their understanding into the record. After the verdict was returned a dispute arose as to whether the
parties actually entered into a Rule 11 Agreement, as Plaintiffs contend, or if the negations [sic] of the parties
only resulted in an unenforceable "agreement to agree" as Defendants contend.
The court after giving due consideration to the pleadings, summary judgment evidence and applicable law
concludes that an appropriate Final Judgment should be granted. It is therefore accordingly:
Ordered, Adjudged and Decreed that John Stergiou and Main Marine Repair and Industrial Cleaning Co.,
Defendants/ Cross-Plaintiffs, shall Take Nothing by this action and, General Metal Fabricating, Inc., GMF
Leasing, Inc., and Arnold Curry, Plaintiffs/ Cross-Defendants, are entitled to a Declaration that the subject
Rule 11 Agreement is enforceable and General Metal Fabricating, Inc., GMF Leasing, Inc., and Arnold Curry,
Plaintiffs/ Cross-Defendants go hence with costs and without delay.
All relief not granted herein is Denied. Costs are charged to John Stergiou and Main Marine Repair and
Industrial Cleaning Co.
On October 1, 2008, the trial court entered another order specifically denying the GMF Parties' second
summary judgment motion. The GMF Parties then filed this notice of appeal complaining of the entry of the
On October 29, 2008, Stergiou filed a motion for the trial court to modify the judgments. On December 1,
2008, the trial court granted the motion to modify. In its order granting the motion, the trial court expressly
states that the September 29, 2008 orders were interlocutory and were not intended to be final and
appealable. The order states that the language in September 29, 2008 orders stating that Stergiou "take
nothing" from this suit was only directed to Stergiou's attorneys' fees claim for bringing the declaratory
judgment action and not to any other claims in the suit. In the order the trial court also requested additional
briefing from the parties to assist in the resolution of the all remaining claims. The December 1, 2008 order
Order Modifying Judgment
On September 29, 2008, the Court entered two orders relating to summary judgment motions filed by the
parties in this case. . . . The Court held that the Rule 11 Agreement is an enforceable agreement. That part of
the September 29th Orders remains intact.
However, the September 29th Orders also included language that Stergiou take nothing. That language was
directed at Stergiou's claim for attorneys fees relating to his declaratory judgment action. This language did
not relate to any other causes of action or claims for relief in this case. And any such implication is hereby
clarified, and the Orders are modified to reflect the limited nature of this ruling.
The September 29 Orders also included language that "all relief not granted herein is denied." That language
is hereby withdrawn from the September 29th Orders. The September 29th Orders were not final judgments
as there are live causes of action remaining in this case. The September 29th Orders were interlocutory. The
Court finds it has jurisdiction to enter this Order. The Parties shall file all supplemental briefing regarding
summary judgments by March 1, 2009.
In light of these orders, Stergiou has filed a motion to dismiss this appeal for lack of jurisdiction because there
has been no final appealable judgment entered by the trial court for us to consider. Stergiou argues that he
timely filed the motion to modify the judgments dated September 29, 2008, the trial court granted the motion
and modified the judgments within the time of its plenary power--expressly stating that the judgments were
interlocutory and asking for additional briefing on the remaining claims--and thus the GMF Parties notice of
appeal is premature.
The GMF Parties argue that, pursuant to Texas Rule of Civil Procedure 329b(d), the motion to modify was
untimely because it was filed on October 29, 2008, more than 30 days after the order entitled "Final
Judgment" on September 29, 2008. They argue that the timetable for determining the trial court's plenary
power begins to run from the judgments dated September 29, 2008 and not from the order denying their
second motion for summary judgment dated October 1, 2008. Thus, they argue that the trial court did not
have plenary power to modify the judgments dated September 29, 2008 and these judgments are final and
appealable. We address these arguments below.
Texas Rule of Civil Procedure 329b(h) governs the resolution of the motion to dismiss. Pursuant to this rule
any modification to a final judgment, whether material or not, made while the trial court has plenary power
over the judgment, restarts the appellate timetables and extends the trial court's plenary power. See Tex. R.
Civ. P. 329b(h); Lane Bank Equip. Co. v. Smith S. Equip., Inc., 19 S.W.3d 308, 313 (Tex. 2000) (order making
clerical change to judgment while the court has plenary power will restart deadlines); Check v. Mitchell, 758
S.W.2d 755, 756 (Tex.1988) (addition of correct docket number and statement that all writs could issue
restated deadlines); Crown Constr. Co. v. Huddleston, 961 S.W. 2d 552, 559-60 (Tex. App.-- San Antonio
1997, no pet.) (order clarifying street address of property restarted deadlines); Owens-Corning Fiberglas
Corp. v. Wasiak, 883 S.W.2d 402, 405 (Tex. App.--Austin 1994, no writ) (order making change in signature
date restarted deadlines). Specifically, Texas courts have held that the entry of orders addressing additional
or different grounds for summary judgment will restart the timetable for a trial court's plenary power. See, e.g.,
Quaniam v. Frasco Rest. & Catering, 17 S.W.3d 30, 40 (Tex. App.--Houston [14th Dist.] 2000, pet. denied).
In this case assuming, as the GMF Parties argue, that the September 29, 2008 orders were entered as "final"
judgments, the trial court's order on October 1, 2008 addressing and disposing of additional grounds for
summary judgment found in the GMF Parties' second motion for summary judgment modified these
judgments. Id. Accordingly, we hold that, pursuant to Rule 329b(h), the trial court's plenary power extended
for 30 days after October 1, 2008 and Stergiou's motion to modify was timely filed. Id. In their briefing, the
GMF Parties do not contest the conclusion that, if the motion to modify was timely filed, the trial court had
plenary power to modify the judgments and declare them to be interlocutory.
Accordingly, the orders complained of in the GMF Parties' notice of appeal are interlocutory, and there is no
final judgment upon which appeal can be based.
Consequently, we hold that this appeal must be dismissed for lack of jurisdiction.
George C. Hanks, Jr.
Panel consists of Justices Keyes, Alcala and Hanks.