BEAUMONT – The Court of Appeals for the 9th District of Texas at Beaumont has affirmed in part and reversed in part a 2016 summary judgment in favor of the defendants in a breach of contract case.
A trial court issued summary judgment dismissing appellant Joe Chapman’s claims against defendants Qamar U. Arfeen, et al., in February 2016. The defendants' counterclaims were dismissed as well. On Aug. 30, Judge Charles Kreger of the 9th District court issued a new ruling Aug. 30.
Kreger reversed the trial court's decision regarding some of Chapman's claims and affirmed others. The appellate court affirmed the lower court's decision dismissing Chapman's conversion and theft claims against all parties with the exception of Harbor Hospitals of Lake Charles LP and Harbor Hospital Land Investors of Southeast Texas.
"We reverse and remand the case to the trial court to consider Chapman’s claims governed by the four-year statute of limitations—declaratory judgment requests, breach of contract, breach of fiduciary duty, and fraud—against Qamar U. Arfeen" and the defendants," the ruling states.
The defendants' claim for attorney fees was remanded back to the lower court. The original summary judgment ruling dismissing the rest of the defendants' claims against Chapman regarding breach of fiduciary duty and duty of loyalty was affirmed.
According to the ruling, Chapman and Arfeen are former business partners who opened a Texas hospice in 2005. Nine years later, Chapman filed suit against Arfeen and multiple hospice properties under Arfeen’s control, alleging breach of contract, breach of fiduciary duty, fraud, conversion and theft. The defendants countersued.
Chapman claims that when he eventually resigned from the company he had formed with Arfeen, he was notified that he was no longer a partner and that his interests had been converted into profits in 2010. He filed suit in 2014.
In response to the charges, the defendants argued that Chapman waited too long to file his complaints and was in violation of the statute of frauds and the statute of limitations. The defendants also argued that Chapman ratified the change in his ownership status by accepting profit payments. They asked for attorney’s fees to cover the expense of defending themselves against Chapman’s allegations.
The court remarks that: “Following a nonevidentiary hearing, the trial court granted defendants’ motion for summary judgment on Feb. 29, 2016, dismissing all of Chapman’s claims in their entirety... Soon thereafter, Chapman filed his own no-evidence and traditional motion for summary judgment seeking dismissal of all of defendants’ counterclaims against him.”