George Michael Welch v. Felix Lopez and Summerlyn Lopez

Fourth Court of Appeals
                                      San Antonio, Texas
                                 MEMORANDUM OPINION

                                         No. 04-24-00366-CV

                                      George Michael WELCH,
                                             Appellant

                                                   v.

                                Felix LOPEZ and Summerlyn Lopez,
                                           Appellees

                      From the 73rd Judicial District Court, Bexar County, Texas
                                    Trial Court No. 2023CI12509
                            Honorable Norma Gonzales, Judge Presiding

Opinion by:       Adrian A. Spears II, Justice

Sitting:          Irene Rios, Justice
                  Lori Massey Brissette, Justice
                  Adrian A. Spears II, Justice

Delivered and Filed: April 15, 2026

AFFIRMED

           George Michael Welch argues that the trial court erred in failing to award him attorney’s

fees. We affirm.

                                            BACKGROUND

           In 2021, Welch and Appellees Felix and Summerlyn Lopez (“the Lopezes”) entered into

an owner-financed agreement whereby Welch agreed to sell commercial property (“the Subject

Property”) to the Lopezes. The agreement provided for a sales price of $200,000 with the following
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payment schedule: (1) a $20,000 down payment; (2) $20,000 on May 1, 2022; (3) $20,000 on May

1, 2023; (4) $20,000 on May 1, 2024, (5) $20,000 on May 1, 2025; and (6) a “Balloon Payment”

of $100,000 on May 1, 2026. The agreement further provided that a “late fee of 10% will be

assessed if payment is 10 days late” and that “[n]o interest will be charged if payment schedule is

adhered to.” However, “[a] 5% interest fee will be charged if payment schedule is not adhered to,

attached to the current payment due.” “Furthermore, if the Grantee [Lopez] is 91 days late,

[f]oreclosure procedures will begin and expenses incurred will be at the Grantee’s expense. All

monies and improvements attached to the property will revert to Grantor [Welch].”

       The agreement further provided that the Lopezes would allow Welch “continued access,

not to exceed the designed [sic] time period of two (2) years, from the execution of this agreement.”

“This time will be utilized for removing Farm Tractors and Implements, tools and misc [sic]

construction equipment and trailers.” According to the agreement, Welch “will also clean-out shop

and property.”

       On May 1, 2023, the Lopezes failed to make a payment of $20,000 as required by the

agreement. Welch testified that he reminded Felix Lopez about the payment on May 5, 2023 and

again on May 8, 2023. On June 16, 2023, Welch sent the Lopezes a letter demanding payment. At

trial, Welch testified that Felix Lopez began obstructing him from entering the Subject Property.

On June 26, 2023, Welch sued the Lopezes for breach of promissory note, breach of contract, and

money had and received. Welch also sought reasonable and necessary attorney’s fees pursuant to

section 38.001(8) of the Texas Civil Practice and Remedies Code.

       Also on June 26, 2023, Welch filed an application for a temporary restraining order and

temporary injunction, complaining that the Lopezes had prevented him from accessing the Subject

Property for the purpose of removing farm tractors and implements, tools, and miscellaneous




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construction equipment belonging to him as authorized by the agreement. On June 25, 2023, the

trial court granted a temporary restraining order. On August 14, 2023, the Lopezes answered and

alleged affirmative defenses and a counterclaim for breach of contract. They also sought attorney’s

fees pursuant to section 38.001. On July 14, 2023, the Lopezes attempted to give a cashier’s check

in the amount of $22,000.00 to Welch, which Welch refused.

       On August 28, 2023, the trial court granted a temporary injunction, ordering that Welch be

allowed unimpeded access to the Subject Property to engage in purposes authorized under the

agreement. The trial court also ordered Welch to “refrain from impeding or interfering [with the

Lopezes’] guests and invitees access to the Subject Property.” On September 20, 2023, Welch filed

a motion for contempt, alleging that Felix Lopez violated the temporary injunction on September

9, 2023 by contacting the sheriff’s office while Welch was on the Subject Property. On September

25, 2023, the Lopezes supplemented their pleadings to add a counterclaim for trespass to chattel,

alleging that in September 2023, Welch had “deliberately turned off the water to [the Lopezes’]

irrigation system that was used to maintain 137 Crepe Myrtle trees” and had damaged the trees as

a result. On October 3, 2023, the Lopezes filed their own motion for contempt, alleging that Welch

had violated the trial court’s order by “deliberately turn[ing] off the water to the Lopez[es’]

irrigation system that was used to maintain” their Crepe Myrtle trees.

       On January 24, 2024, the trial court called the cause “for trial and for a concurrently noticed

hearing on [Welch]’s Motion for Contempt.” The trial court denied Welch’s motion for contempt.

In its final judgment, the trial court ordered that “[a]s a condition to reinstatement of the subject

promissory note, [the Lopezes] shall pay to [Welch], on or before April 12, 2024, the sum of

$22,221.92.” “Upon timely payment to [Welch], the subject promissory note shall be reinstated




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and shall continue in force thereafter according to its terms.” The trial court denied each party’s

request for attorney’s fees and taxed costs of court against the party incurring same.

       The trial court then made findings of fact and conclusions of law. It found that the parties

had entered into a written contract in November 2021 and amended that contract on December 9,

2021. It found that under the contract, the Lopezes agreed to pay a total of $200,000.00 in

installments, with $20,000.00 as a down payment and payments of $20,000.00 due on May 1,

2022, May 1, 2023, May 1, 2024, and May 1, 2025. A balloon payment of $100,000.00 was due

on May 1, 2026. The trial court found that the Lopezes paid $20,000.00 in 2021 and 2022, which

amounted “to a $40,000.00 investment” into the Subject Property. The trial court explained that

section 7 of the contract states, “Furthermore, if the Grantee is 91 days late, [f]oreclosure

procedures will begin and all expenses incurred will be Grantee’s expense . . . .” The trial court

found that the Lopezes did not make a timely payment on May 1, 2023, and that on June 26, 2023,

Welch filed a lawsuit seeking, among other remedies, “judicial foreclosure of the vendor’s lien

and that said remedy be carried out by the sheriff’s sale of the Subject Property to satisfy all

amounts owed on the judgment.” The trial court further found that the Lopezes submitted a late

payment through their counsel on July 14, 2023, which was within the agreement’s 90-day period.

According to the trial court, the Lopezes were “under the belief that they could cure late payments

within the 90-day period.” The trial court found that Welch “unjustifiably refused” the Lopezes’

late payment and that Welch breached the contract by initiating foreclosure proceedings within 90

days. The trial court found that Welch’s conduct was “unfair and inequitable” to the Lopezes and

that Welch “suffered no damages” due to the late payment.

       In its conclusions of law, the trial court determined that the parties had entered into a valid

contract and that while the Lopezes had made an untimely payment, because they did so within




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the 90-day period, they had not breached the contract. The trial court concluded Welch had

breached the agreement by prematurely filing suit to foreclose on the property when the Lopezes

“had made reasonable efforts to submit payment to” Welch. The trial court further found that

equitable relief was appropriate to prevent acceleration of the promissory note because of “the

confusing language in Section 7,” the Lopezes’ “substantial investment” in the Subject Property,

and the Lopezes’ “attempt to make payment to [Welch]’s counsel in full.” The trial court concluded

that the Lopezes’ untimely payment was excused by Welch’s acceleration and wrongful

foreclosure action. The trial court further concluded that Welch was not entitled to recovery and

attorney’s fees because Welch was not the prevailing party and did not recover damages.

According to the trial court, Welch was not awarded anything “either monetary or equitable”;

“rather[,] the note was reinstated, and [the] status quo [was] preserved.”

                            ATTORNEY’S FEES: PREVAILING PARTY

       On appeal, Welch argues the trial court erred in failing to award him attorney’s fees.

Section 38.001 applies to a claim for “an oral or written contract.” TEX. CIV. PRAC. & REM. CODE

§ 38.001(8). To recover attorney’s fees under section 38.001 of the Texas Civil Practice and

Remedies Code, a claimant must (1) “plead and prevail on a claim for which attorney’s fees are

permitted under section 38.001,” (2) “be represented by an attorney,” (3) “present the claim to the

opposing party or his agent,” (4) “demonstrate that the opposing party did not tender payment

within thirty days after the claim was presented,” and (5) incur reasonable attorney fees. 1/2 Price

Checks Cashed v. United Auto. Ins. Co., 344 S.W.3d 378, 383 (Tex. 2011); see Ventling v.

Johnson, 466 S.W.3d 143, 154 (Tex. 2015) (“To recover attorney’s fees under section 38.001, a

party must prevail on the underlying claim and recover damages.”); Dandachli v. Active

Motorwerks, Inc., No. 03-19-00494-CV, 2021 WL 3118437, at *3 (Tex. App.—Austin July 23,




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2021, no pet.) (“In addition, the party seeking the award [of attorney’s fees] must provide evidence

of the fees arising from the contract claim.”).

       Here, the trial court determined that the Lopezes’ failure to make the payment timely was

excused by Welch’s improper acceleration and wrongful foreclosure action. The trial court

concluded that Welch was “not the prevailing party.” “Whether a party prevails turns on whether

the party prevails upon the court to award it something, either monetary or equitable.” Ventling,

466 S.W.3d at 154 (quoting Intercontinental Grp. P’ship v. KB Home Lone Star L.P., 295 S.W.3d

650, 655 (Tex. 2009)). “In short, a plaintiff ‘prevails’ when actual relief on the merits of his claim

materially alters the legal relationship between the parties by modifying the defendant’s behavior

in a way that directly benefits the plaintiff.” Id. (quoting Farrar v. Hobby, 506 U.S. 103, 111

(1992)). Under section 38.001, once a party has shown their entitlement to attorney’s fees, a trial

court has no discretion to deny them. See id.; see also Dandachli, 2021 WL 3118437, at *3 (“If a

party prevails on his contract claim, recovers damages or other meaningful relief, and provides

sufficient evidence of the associated fees, an award of fees is mandatory.”).

       A.      Preliminary Injunction

       Welch first argues that the trial court erred in not determining he was a prevailing party

because he secured a temporary injunction and enforced “his contractual right to access the

property, and in doing so he recovered over $140,000.00 worth of” his equipment that was still on

the Subject Property. According to Welch, “[t]hat this issue had been resolved (through the

injunction) by the time of trial in no way diminishes the real cost [he] incurred in having to

forcefully cure the Lopezes’ contractual breaches.” In support of his argument that obtaining a

temporary injunction before trial entitles him to “prevailing party” status under chapter 38, he cites

to Veasay v. Abbott, 13 F.4th 362 (5th Cir. 2021), a Fifth Circuit opinion relating to whether a




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party is a prevailing party under federal statutes and is thus inapplicable to whether Welch is

entitled to attorney’s fees pursuant to chapter 38. Welch further cites cases for the proposition that

even though he had obtained his equipment before trial, his claim for attorney’s fees under chapter

38 was not moot. See Allstate Ins. Co. v. Hallman, 159 S.W.3d 640, 643 (Tex. 2005); Camarena

v. Tex. Emp. Comm’n, 754 S.W.2d 149, 151 (Tex. 1988); Hansen v. JP Morgan Chase Bank, N.A.,

346 S.W.3d 769, 774-75 (Tex. App.—Dallas 2011, no pet.). However, we conclude that the

dispositive issue is not whether Welch’s claim for attorney’s fees under chapter 38 was moot

because he had already obtained his equipment before trial. Instead, the dispositive issue is whether

he was a prevailing party on the basis of merely obtaining a temporary injunction.

       As noted, under Texas Supreme Court precedent, a party “‘prevails’ when actual relief on

the merits of his claim materially alters the legal relationship between the parties by modifying the

defendant’s behavior in a way that directly benefits the plaintiff.” Ventling, 466 S.W.3d at 154

(quoting Farrar, 506 U.S. at 111) (emphasis added). A temporary injunction, however, is a

preliminary matter, and the trial court’s ruling on a temporary injunction does not support the

defense of res judicata. See Williams v. Houston Firemen’s Relief & Ret. Fund, 121 S.W.3d 415,

437 n. 21 (Tex. App.—Houston [1st Dist.] 2003, no pet.); see also Epps v. Fowler, 351 S.W.3d

862, 868-69 (Tex. 2011) (holding that “a defendant is a prevailing party when a plaintiff nonsuits

a case with prejudice” because the res judicata effect of a nonsuit with prejudice “works a

permanent, inalterable change in the parties’ legal relationship to the defendant’s benefit”). “To

receive a temporary injunction, a party need not prove it will prevail on the merits; it must only

show ‘a probable right to recovery.’” Glattly v. Air Starter Components, Inc., 332 S.W.3d 620,

638 (Tex. App.—Houston [1st Dist.] 2010, pet. denied) (quoting Butnaru v. Ford Motor Co., 84

S.W.3d 198, 204 (Tex. 2002)). “The expression ‘probable right to recover’ is a term of art; it does




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not imply any kind of determination that becomes the law of the case.” Id. (quoting 183/620 Grp.

Joint Venture v. SPF Joint Venture, 765 S.W.2d 901, 904 (Tex. App.—Austin 1989, writ dism’d

w.o.j.)). Thus, a temporary injunction is distinct from a permanent injunction; a party being granted

injunctive relief in the form a permanent injunction could form the basis for an award of attorney’s

fees as a prevailing party. See Norton v. Deer Creek Prop. Owners Ass’n, No. 03-09-00422-CV,

2010 WL 2867375, at *4-*9 (Tex. App.—Austin July 22, 2010, no pet.). We hold that Welch

obtaining a preliminary injunction in this case cannot form the basis of an award of attorney’s fees

under chapter 38.

       B.      Award of $22,221.92

       Welch next argues that he is a prevailing party because the judgment ordered the Lopezes

to pay him $22,221.92. According to Welch, in doing so, the judgment “modif[ied] the [Lopezes’]

behavior in a way that directly benefits [him].” Intercontinental Grp. P’ship, 295 S.W.3d at 654.

However, it is clear from the trial court’s findings of fact that the award of $22,221.92 merely

relates to the late payment the Lopezes attempted to make to Welch within 90 days of the payment

deadline. Indeed, the final judgment states that upon payment of $22,221.92 by the Lopezes, the

promissory note is “reinstated and shall continue in force thereafter according to its terms.” In its

findings of fact, the trial court found that Welch improperly rejected this attempted payment and

improperly brought a foreclosure action before the end of the 91-day period as set out in the

agreement. We agree with the Lopezes that in ordering the payment of $22,221.92, the trial court

merely put the parties back to the same status they had before Welch filed suit. Thus, we conclude

the award of $22,221.92 does not materially alter the legal relationship between the parties. See

id. at 652 (emphasizing that to be a prevailing party, a party must “obtain actual and meaningful

relief, something that materially alters the parties’ legal relationship”).




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        C.      Findings of Fact Supporting Trial Court’s Conclusion That Welch Is Not a
                Prevailing Party

                1. Interpretation of Contract

        Welch next contends that the “trial court’s findings of fact do not support its prevailing-

party conclusion.” Welch first attacks the trial court’s finding that he “breached a condition of the

contract by initiating foreclosure proceedings within 90 days” by contending that the trial court

erroneously interpreted the contract as a matter of law. In construing a written contract, we

“ascertain the true intentions of the parties as expressed in the instrument.” Valence Operating Co.

v. Dorsett, 164 S.W.3d 656, 662 (Tex. 2005). “To achieve this objective, courts should examine

and consider the entire writing in an effort to harmonize and give effect to all the provisions of the

contract so that none will be rendered meaningless.” Id. “Contract terms are given their plain,

ordinary, and generally accepted meanings unless the contract itself shows them to be used in a

technical or different sense.” Id. “The construction of an unambiguous contract is a question of

law for the court,” which we review de novo. Willis v. Donnelly, 199 S.W.3d 262, 275 (Tex. 2006);

see also J.M. Davidson, Inc. v. Webster, 128 S.W.3d 223, 229 (Tex. 2003). “A contract is

unambiguous if it can be given a definite or certain legal meaning.” J.M. Davidson, 128 S.W.3d at

229. “On the other hand, if the contract is subject to two or more reasonable interpretations after

applying the pertinent rules of construction, the contract is ambiguous, creating a fact issue on the

parties’ intent.” Id.

        The agreement provided for a price of $200,000.00, subject to the following payment

schedule:

        PAYMENT SCHEDULE:

        1) Grantee agrees to pay to the Grantor a 10% ($20,000.00) “Down Payment”
           upon execution of this agreement.




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       2) Grantee agrees to pay the sum of $20,000.00 on May 1, 2022, $20,000.00 on
          May 1, 2023, $20,000.00 on May 1, 2024, $20,000.00 on May 1, 2025, and a
          “Balloon Payment” of $100,000.00 on May 1, 2026.

       3) A late fee of 10% will be assessed if payment is 10 days late.

       4) No interest will be charged if payment schedule is adhered to. A 5% interest fee
          will be charged if payment schedule is not adhered to, attached to the current
          payment due.

In a section titled “Specifications,” the parties agreed to the following:

       1) Grantee will be responsible for payment of Property, County, School, etc. taxes
          when due annually beginning January 31, 2023 ([s]tarting for Calendar Year
          2022). Grantor will pay taxes for the year 2021.

       2) Grantor will pay the CPS electric bill and Green Valley SUD water bill, not to
          exceed the period specified below.

       3) Grantor agrees to maintain adequate Bovine on the property to satisfy the Bexar
          County/Texas Agriculture Tax requirements for the specified period below. If
          requirements are breached by Grantee, the additional taxes will be the
          responsibility of the Grantee.

       4) Grantee has written permission to build, develop, or otherwise encumber the
          property upon execution of this agreement. Grantee may sell the property when
          agreement is completed or with permission of Grantor. If the improvements are
          cause for tax increase, the Grantee is responsible.

       5) Grantor shall not allow any companies, entities, other than Law Enforcement
          or Fire/Rescue personnel, to enter the property without permission of the
          Grantee.

       6) Grantor will convey all mineral rights owned by Grantor to Grantee.

       7) Grantor shall tender a “Warranty Deed” upon completion of this agreement.

The agreement then provided for the 91-day period at issue in this appeal:

       Furthermore, if the Grantee is 91 days late, [f]oreclosure procedures will begin and
       all expenses incurred will be at the Grantee’s expense. All monies and
       improvements attached to the property will revert to Grantor.




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The agreement continued with the following:

         8) Grantee will allow Grantor continued access, not to exceed the designed time
            period of two (2) years from execution of this agreement. This time will be
            utilized for removing Farm Tractors and Implements, tools and misc
            construction equipment and trailers. Grantor will also clean out shop and
            property.

At the end of the agreement, the contract had the following “merger clause”:

         This Agreement contains the entire agreement and understanding on this subject
         matter and supersedes all other prior and contemporaneous agreements.

         In the event any one (1) or more of the provisions of this agreement shall be of [sic]
         or become invalid, illegal, or unenforceable in any aspect, the validity, legality, and
         enforceability of the remaining provisions of this Agreement shall not be affected.

         In interpreting the provision, “if the Grantee is 91 days late, [f]oreclosure procedures will

begin and all expenses incurred will be at the Grantee’s expense,” the trial court determined that

Welch had improperly brought a foreclosure action by filing it before the Lopezes’ payment was

91 days late. The trial court also found that Welch had improperly rejected the Lopezes’ attempted

late payment tendered before the 91st day.

         Welch argues on appeal that the 91-day provision “is written as a self-executing event, not

as a prohibition.” We disagree with this interpretation by Welch because foreclosure proceedings

cannot be self-executing. A party must necessarily initiate foreclosure proceedings. In considering

the plain language of the contract, we agree with the trial court’s interpretation that the agreement

provided the Grantor could not properly initiate foreclosure proceedings until the Grantee was 91

days late with a payment. 1


1
 We note that Welch complains about the trial court’s finding that the Lopezes were “under the belief that [they] could
cure late payments within the 90-day period according to the Contract language,” emphasizing that under the parol
evidence rule, the Lopezes’ belief is not material or relevant. Welch also points out that the contract has a merger
clause stating, “This Agreement contains the entire agreement and understanding on this subject matter and supersedes
all other prior or contemporaneous agreements.” We agree that the Lopezes’ belief is irrelevant in this case. See First
Bank v. Brumitt, 519 S.W.3d 95, 109, 110 (Tex. 2017) (explaining that “the construction of an unambiguous contract,
including the determination of whether it is unambiguous, depends on the language of the contract itself, construed in
light of the surrounding circumstances” and that “[e]xtrinsic evidence cannot be used to show that the parties probably


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                 2. Tender of Late Payment

        Welch next argues that the evidence is legally and factually insufficient to support the trial

court’s findings that Welch “unjustifiably refused payment” and that Welch’s conduct was “unfair

and inequitable” to the Lopezes. Welch argues that when he “refused payment at the [temporary]

injunction hearing on July 21, 2023, the Lopezes were still in breach because they were continuing

to impede Welch’s access to the property, they had failed to provide proof of insurance, and they

failed to tender all interest due.” According to Welch, he therefore “properly refused payment.” In

response, the Lopezes argue that there is legally and factually sufficient evidence that they were

not in material breach of the contract when Welch refused the tender of their late payment.

        We review a trial court’s findings of fact after a bench trial under the same standards

applied to jury verdicts. Bekins Van Lines, Inc. v. Kahn, 717 S.W.3d 86, 94 (Tex. App.—Austin

2025, pet. denied); Donias v. Old Am. Cnty. Mut. Fire Ins. Co., 649 S.W.3d 789, 793 (Tex. App.—

El Paso 2022, no pet.). As the factfinder, the trial court is the sole judge of the credibility of the

witnesses and the weight to give their testimony. Bekins Van Lines, 717 S.W.3d at 94; Donias, 649

S.W.3d at 793. The trial court is free to draw its own deductions from all the evidence and is not

bound by the testimony of any witness. Bekins Van Lines, 717 S.W.3d at 94. Thus, “[w]e defer to

the trial court’s findings of fact—so long as they are supported by the record—and review

conclusions of law de novo.” Id. (quotation omitted).

        When an appellant challenges the legal sufficiency of an adverse finding on which he did

not have the burden of proof at trial, he must demonstrate on appeal that there is no evidence to

support the adverse finding. Croucher v. Croucher, 660 S.W.2d 55, 58 (Tex. 1983); Kazmi v.



meant, or could have meant, something other than what their agreement stated”) (citation omitted). We have construed
the unambiguous language of the agreement in this appeal as a matter of law and have not based any part of our
holding on the Lopezes’ belief. See id. at 110.


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Kazmi, 693 S.W.3d 556, 566 (Tex. App.—Austin 2023, pet. denied); Benavides v. Alexander, 646

S.W.3d 14, 23 (Tex. App.—San Antonio 2021, pet. denied). When an appellant challenges the

factual sufficiency of an adverse finding on an issue the appellant did not have the burden of proof

at trial, he brings an “insufficient evidence” challenge and must demonstrate that the “evidence

adduced to support the vital fact, even if it is the only evidence adduced on an issue, is factually

too weak alone to support it.” Ritchey v. Crawford, 734 S.W.2d 85, 87 n.1 (Tex. App.—Houston

[1st Dist.] 1987, no writ) (emphasis in original). In reviewing this “insufficient evidence”

challenge, we consider, weigh, and examine all the evidence that supports the finding and then

consider all the evidence that is contrary to the finding. Plas-Tex, Inc. v. U.S. Steel Corp., 772

S.W.2d 442, 445 (Tex. 1989). We will set aside the finding only if the finding is so contrary to the

overwhelming weight of the evidence as to be clearly wrong and unjust. Star Enter. v. Marze, 61

S.W.3d 449, 462 (Tex. App.—San Antonio 2001, pet. denied).

       “A breach of contract occurs when a party fails to perform an act that it has expressly or

impliedly promised to perform.” Henry v. Masson, 333 S.W.3d 825, 835 (Tex. App.—Houston

[1st Dist.] 2010, no pet.) (quoting Case Corp. v. Hi–Class Bus. Sys. of Am., Inc., 184 S.W.3d 760,

769-70 (Tex. App.—Dallas 2005, pet. denied)). “A material breach by one party to a contract can

excuse the other party from any obligation to perform.” Id.; see Mustang Pipeline Co. v. Driver

Pipeline Co., 134 S.W.3d 195, 196 (Tex. 2004) (“It is a fundamental principle of contract law that

when one party to a contract commits a material breach of that contract, the other party is

discharged or excused from further performance.”). “The materiality of a breach—the question of

whether a party’s breach of a contract will render the contract unenforceable—generally presents

a dispute for resolution by the trier of fact.” Henry, 333 S.W.3d at 835.




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       The payment at issue was due on May 1, 2023. The 91st day after May 1, 2023 was August

21, 2023. At trial, Felix Lopez testified that he attempted to cure his late payment through a

cashier’s check of $20,000.00. Felix Lopez testified that Welch rejected it because he wanted the

ten percent late fee. Felix Lopez calculated ten percent and on July 14, 2023, submitted a cashier’s

check for $22,000.00, but Welch rejected that payment too. Felix Lopez testified that Welch

“wanted the interest rates.” This cashier’s check was entered into evidence and was dated July 14,

2023. Felix Lopez testified that “[t]he interest on there after calculating it on that date came up to

$208.00.” Felix Lopez testified, “I went ahead and made it for $300 for interest, just in case they

wanted a little bit more. So, I sent out a check for $22,300.00.” Felix Lopez testified that on July

14, 2023, he gave the cashier’s check to Welch’s attorney at his law office because Felix Lopez

“wasn’t in communication with Mr. Welch.” When asked if he was informed of the proper amount

to pay by Welch, Felix Lopez testified,

       We weren’t given a specific amount, it was just rejected. And so, we had to kind of
       go through the contract and figure out why it’s being rejected because all we knew
       it was not the right amount. So I think it was 20,000 and 22,000. And then we
       looked at it where it said interest accruded [sic]. So I factored that time and interest
       and it was like $208. I made it for $300 just in case. I just didn’t want anymore
       friction.

Felix Lopez testified that he made three different attempts to make the proper late payment.

       Admitted in evidence was an email from the Lopezes’ attorney dated July 14, 2023, to

Welch’s attorney; the email stated that the Lopezes’ attorney was attempting to tender payment in

the form of a cashier’s check to Welch so that they could resolve the lawsuit. Also admitted in

evidence was a FedEx envelope, which was marked August 10, 2023 “Priority Overnight.” Thus,

the evidence shows the Lopezes made multiple attempts at tendering their payment before the 91st

day of August 21, 2023. Welch points out that his demand letter stated that in addition to

$22,000.00, the Lopezes owed $2.77 per day in accrued interest beginning on May 2, 2023 until



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paid in full. Thus, pursuant to Welch’s demand letter, the Lopezes’ tender on August 11, 2023

should have been for $22,000.00 plus $193.90 in accrued interest, totaling $22,193.90. Felix Lopez

testified that he attempted to give Welch a payment of $22,300.00. We hold that the evidence is

legally and factually sufficient to support the trial court’s finding that Welch “unjustifiably refused

payment.” The evidence is also legally and factually sufficient to show that Welch’s conduct was

“unfair and inequitable” to the Lopezes, as the above evidence supports the trial court determining

that the Lopezes were attempting to submit their late payment within the terms of the contractual

language and Welch was not being reasonable in his refusal of the late payment.

        Welch next argues that he properly “refused payment at the [temporary] injunction hearing

on July 21, 2023,” because the Lopezes had first breached the contract by impeding access to the

property and by failing to insure the property. First, Felix Lopez testified at trial that he called his

homeowner’s insurance company and was informed that his umbrella policy covers the Subject

Property. According to Felix Lopez, “it states that the insurance from our house moves to any other

properties that we have due to our umbrella policy.” Felix Lopez testified that when he and his

wife signed the contract in this case, he and his wife “contacted [their] homeowner’s insurance to

go ahead and get insurance on the land.” Felix Lopez testified that his homeowner’s insurance

informed him that the land was “already insured because [his and his wife’s] policy states that it

extends to all properties that [they] own.” Felix Lopez testified that the amount of coverage was

$300,000 in liability. On appeal, Welch complains that the Lopezes’ home insurance policy

admitted in evidence does not explicitly cover the Subject Property. However, it also does not

contradict Lopez’s testimony that his umbrella policy covered the Subject Property.

        Second, with regard to Welch’s argument that the Lopezes were in material breach before

him because they interfered with his rights to access the Subject Property, Welch fails to mention




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the evidence at trial showing that he was also interfering with an irrigation system watering the

Lopezes’ 137 Crepe Myrtle trees. Felix Lopez testified that his and his wife’s irrigation system to

the trees was disconnected while they were on vacation. Felix Lopez testified that he reconnected

it, and the next day, the irrigation system was unscrewed and disconnected. Felix Lopez

reconnected the irrigation system again, and the next day, “it was thrown even further” and one of

the “irrigation timers was broken.” Felix Lopez purchased a new timer, connected it again, and

then the PVC pipe was cut, the “irrigation had been thrown, and there was primer and glue with a

PVC cap where . . . our irrigation timer, where it was connected, and it was just a threading.” Felix

Lopez testified that Welch’s destruction of his and his wife’s irrigation system is what caused his

and his wife’s Crepe Myrtle trees to die. In contrast, Welch testified at trial that he had found a

water leak and fixed it while the Lopezes had been on vacation. We note that as the fact finder, the

trial court could have determined that Felix Lopez was a credible witness and Welch was not. See

Bekins Van Lines, 717 S.W.3d at 94; Donias, 649 S.W.3d at 793.

       In addition to the irrigation system, Felix Lopez also testified that Welch had threatened

one of Felix Lopez’s employees when that employee was present on the Subject Property. Felix

Lopez testified that Welch told the employee that “he [Welch] was going to shoot anybody or any

employee that comes through that gate.” Given all this evidence, the trial court, as factfinder, could

have reasonably determined that the Lopezes’ actions were not a material breach to the contract in

question and were in reaction to Welch’s actions. We hold the evidence is legally and factually

sufficient to support the trial court’s findings that Welch “unjustifiably refused payment” and that

Welch’s conduct was “unfair and inequitable” to the Lopezes.




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                                           CONCLUSION

       For the reasons stated above, we hold the trial court did not err in failing to award attorney’s

fees to Welch under chapter 38 because Welch has failed to show on appeal that he was a prevailing

party. We therefore affirm the judgment of the trial court.


                                                   Adrian A. Spears II, Justice




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