05-08-00915-CV pet denied Oct 2009
File: 080915F - From documents transmitted: 05/21/2009
AFFIRMED; Opinion filed May 21, 2009
Court of Appeals
Fifth District of Texas at Dallas
MICHAEL G. BYBOTH, Appellant
WOOD LIMITED PARTNERSHIP, AMS STAFF LEASING, INC.,
AND CHARLES D. WOOD, JR., Appellees
On Appeal from the 296th Judicial District Court
Collin County, Texas
Trial Court Cause No. 296-3823-07
Before Justices Moseley, O'Neill, and Murphy
Opinion By Justice Moseley
The trial court entered a judgment in favor of appellee Wood Limited Partnership (Wood) and against
appellant Michael G. Byboth based on Byboth's guaranty of a promissory note. In three issues, Byboth contends
the trial court erred: (1) in failing to enter a take-nothing judgment as to him because Wood materially altered the
promissory note to his prejudice, which discharged and relieved him from liability; (2) in failing to award him
attorney's fees; and (3) in failing to file requested findings of fact and conclusions of law. The background of the
case and the evidence adduced at trial are well known to the parties; thus, we do not recite them here in detail.
Because all dispositive issues are settled in law, we issue this memorandum opinion. Tex. R. App. P. 47.2(a),
47.4. We affirm the trial court's final judgment.
The facts pertinent to this appeal are undisputed. In exchange for a loan from Wood, 2-16 Holdings, Inc.
executed a promissory note. Byboth executed a guaranty agreement. Both the note and the guaranty were
secured by a deed of trust. 2-16 Holdings, Inc. made four payments totaling $51,000 on the promissory note, but
Wood applied the payments to another debt. 2-16 Holdings, Inc. defaulted on the note. Eventually, Wood
foreclosed on the property subject to the deed of trust.
Byboth filed suit seeking, among other relief, a declaratory judgment for the amount due under the promissory
note. See Footnote 1 Byboth alleged Wood breached the guaranty by misapplying the four payments, releasing
Byboth from liability on his guaranty agreement. Wood counterclaimed for the deficiency balance of the note, plus
interest and attorney's fees. In calculating the deficiency balance at trial, Wood properly applied the four
payments to 2-16 Holdings, Inc.'s note that was guaranteed by Byboth. The trial court entered judgment against
Byboth for $452,690.76, pre- and postjudgment interest, and attorney's fees.
We first consider Byboth's third issue concerning the trial court's failure to file findings of fact and conclusions
of law. When properly requested, the trial court has a mandatory duty to file findings of fact. Tex. Rs. Civ. P. 296,
297; Landerman v. State Bar of Tex., 247 S.W.3d 426, 430 (Tex. App.-Dallas 2008, pet. denied). If the trial court
fails to file findings of fact and conclusions of law after a proper request, the failure is presumed harmful unless
the record affirmatively shows the complaining party suffered no injury. Landerman, 247 S.W.3d at 430. Fact
findings are not necessary, however, when the matters in question are not disputed. Id. Accordingly, where the
facts are undisputed and the only matters presented on appeal are legal issues to be reviewed de novo, the
failure to file findings of fact and conclusions of law is harmless error. Id. at 430-31.
The facts concerning Byboth's defense of material alteration of the note are undisputed, and this appeal
presents only legal issues to be reviewed de novo. Therefore, findings of fact were not necessary, and any error
in failing to enter findings of fact and conclusions of law was harmless. See id. We resolve Byboth's third issue
In his first issue, Byboth contends he was entitled to a take-nothing judgment on the personal guaranty
because the evidence establishing the defense of material alteration is uncontroverted. We agree the evidence is
uncontroverted, but it negates Byboth's defense, not establishes it.
To be entitled to discharge from liability, the guarantor must prove: (1) a material alteration of the underlying
contract; (2) made without the guarantor's consent; (3) which is to the guarantor's detriment. Vastine v. Bank of
Dallas, 808 S.W.2d 463, 464-65 (Tex. 1991) (per curiam); Old Colony Ins. Co. v. City of Quitman, 163 Tex. 144,
352 S.W.2d 452, 455 (1961). We review a trial court's conclusions of law as a legal question. BMC Software
Belg., N.V. v. Marchand, 83 S.W.3d 789, 794 (Tex. 2002).
There is no evidence of any modification of the promissory note here. The evidence Byboth relies on concerns
whether Wood breached the note, not whether it modified it.
Moreover, the evidence also negates as a matter of law any damages resulting from the misapplication of the
payments from 2-16 Holdings, Inc. It is undisputed that when Wood calculated the amount owed on the note at
trial (or at least before judgment), it credited 2-16 Holdings, Inc. and Byboth with the amounts of the four
payments. Byboth agreed that Wood was not seeking to recover under the guaranty more than 2-16 Holdings,
Inc. owed under the terms of the promissory note. Therefore, any earlier misapplication of the payments due
under the promissory note was corrected, and the judgment on the underlying obligation reflected the correction.
Thus, the undisputed facts fail to show that Byboth should be discharged from liability. We resolve his first issue
against him. See Vastine, 808 S.W.2d at 464-65; Old Colony Ins. Co., 352 S.W.2d at 455. Because Byboth's
second issue depends on a favorable resolution of his first issue, we need not address it.
We have resolved Byboth's issues against him. We affirm the trial court's final judgment.
Footnote 1 2-16 Holdings, Inc. was also a plaintiff, and Wood recovered judgment against it, too. 2-16 Holdings,
Inc. is not a party to this appeal.