Cap City Motors, LLC v. Exeter Finance, LLC

Affirmed and Opinion Filed November 18, 2024

In The
Court of Appeals
Fifth District of Texas at Dallas
No. 05-24-00296-CV

CAP CITY MOTORS, LLC, Appellant
V.
EXETER FINANCE, LLC, Appellee

On Appeal from the 192nd Judicial District Court
Dallas County, Texas
Trial Court Cause No. DC-23-09761

MEMORANDUM OPINION
Before Justices Nowell, Miskel, and Breedlove
Opinion by Justice Breedlove
This is a restricted appeal challenging a default judgment. Appellant Cap City

Motors, LLC did not appear or answer appellee Exeter Finance, LLC’s suit seeking

damages for breach of contract and fraud. In two issues, Cap City contends that the

trial court erred by rendering judgment against it because it is not a party to the

agreement at issue and it lacks minimum contacts with Texas. Concluding that there

is no error on the face of the record, we affirm.
BACKGROUND

Plaintiff/appellee Exeter Finance, LLC is in the business of purchasing

automobile retail installment sales contracts from automobile dealerships.

Defendant/appellant Cap City Motors, LLC, is an automobile dealer. Exeter and

“Car Ko LLC, d/b/a Cap City Motors, LLC” entered into a “Non-Recourse Dealer

Agreement” on December 2, 2020.

Exeter filed this suit on July 18, 2023, against Cap City for breach of the

Agreement and fraud. Exeter alleges that Cap City falsely represented that the

vehicles serving as collateral for the Agreement included certain options and features

that the vehicles did not actually include.

The Agreement’s initial recital provides: “This is a Non-Recourse Dealer

Agreement by and among Exeter Finance LLC, a Delaware limited liability

company (“Exeter”), and the undersigned automobile dealer, on behalf of itself and

each affiliate and subsidiary dealership set forth on the signature page hereto

(individually and collectively referred to as “Dealer”).” The identity of “Dealer” is

not specified until the signature page:

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The Agreement provides that it “shall be governed by and interpreted in all

respects by the laws of the State of Texas, without regard to any conflicts of law

principles or choice of laws. Each party irrevocably submits to the exclusive

jurisdiction and venue of state and federal courts located in Dallas County, Texas in

any legal suit, action or proceeding arising out of, relating to or based upon this

Agreement.”

Exeter filed suit on July 18, 2023, and requested service of process on “Cap

City Motors, LLC” by serving the Texas Secretary of State. The record includes the

Texas Secretary of State’s certification that “a copy of the Citation and Original

Petition” was served by certified mail, return receipt requested, to Cap City Motors,

LLC at an address in Columbus, Ohio, and a return receipt was “received in this

office dated August 21, 2023, bearing signature.” When Cap City did not appear or

answer, Exeter filed a motion for default judgment. The trial court rendered a default
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judgment on September 17, 2023, awarding Exeter damages of $586,129.63,

accrued interest of $7,735.97, and attorney’s fees and costs of $10,288.92, for a total

judgment of $604,154.52.

Cap City filed a “Notice of Appeal by Writ of Error” in the trial court on

March 11, 2024, and in this Court the following day. In two issues, Cap City

contends the trial court erred by rendering a default judgment because (1) “the State

of Texas does not have personal jurisdiction over Cap City Motors, LLC, and

therefore, cannot issue a binding judgment over it,” and (2) “Cap City Motors, LLC”

is not an assumed name of Car Ko, LLC, precluding application of rule 28, Texas

Rules of Civil Procedure. See TEX. R. CIV. P. 28 (“Suits in Assumed Name”).

DISCUSSION

1. Restricted appeal

To prevail on its restricted appeal,1 Cap City must establish that “(1) it filed

notice of the restricted appeal within six months after the judgment was signed; (2) it

was a party to the underlying lawsuit; (3) it did not participate in the hearing that

resulted in the judgment complained of and did not timely file any postjudgment

motions or requests for findings of fact and conclusions of law, and (4) error is

apparent on the face of the record.” Alexander v. Lynda’s Boutique, 134 S.W.3d 845,

848 (Tex. 2004); see also TEX. CIV. PRAC. & REM. CODE ANN. § 51.013 (appeal by

1
“Restricted appeals” under appellate procedure rule 30 have replaced the former “writ of error”
practice, but “[s]tatutes pertaining to writ of error appeals to the court of appeals apply equally to restricted
appeals.” TEX. R. APP. P. 30.
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writ of error may be taken at any time within six months after the date final judgment

is rendered); TEX. R. APP. P. 30 (restricted appeal to court of appeals in civil cases).

Review by restricted appeal “affords an appellant the same scope of review as

an ordinary appeal, that is, a review of the entire case.” Norman Commc’ns v. Tex.

Eastman Co., 955 S.W.2d 269, 270 (Tex. 1997) (per curiam). “The only restriction

on the scope of writ of error review is that the error must appear on the face of the

record.” Id. The “face of the record . . . consists of all the papers on file in the

appeal.” Id. “The rule has long been that evidence not before the trial court prior to

final judgment may not be considered in a writ of error proceeding.” Gen. Elec. Co.

v. Falcon Ridge Apartments, Joint Venture, 811 S.W.2d 942, 944 (Tex. 1991).

2. Parties to Agreement

Cap City’s appellate issues arise from its contention that it was not a party to

the Agreement. Cap City contends that it was “inadvertently listed as a ‘DBA’ in the

Agreement (as opposed to “Cap City Motors”),” and argues that “Car Ko, LLC did

not sign on behalf of any ‘affiliates or subsidiaries’ in the Agreement.” There is

nothing on the face of the record to support this contention, however. To the

contrary, the signature line shows that Ledio Konomi signed the Agreement as

“authorized dealer signatory” for “Car Ko LLC On behalf of itself, its affiliates and

subsidiaries set forth below[,] DBA: Cap City Motors LLC.” Without evidence on

the face of the record to support Cap City’s contention that it was “inadvertently”

listed as a party to the Agreement, Cap City cannot prevail on its restricted appeal.

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See Alexander, 134 S.W.3d at 848 (court could not consider extrinsic evidence in

restricted appeal).

Cap City also argues that civil procedure rule 28, allowing suit by or against

parties in their “partnership, assumed or common name[s],” does not apply because

“Cap City Motors, LLC is not an ‘assumed name’ of Car Ko, LLC.” Texas rule of

civil procedure 28 provides:

Any partnership, unincorporated association, private corporation, or
individual doing business under an assumed name may sue or be sued
in its partnership, assumed or common name for the purpose of
enforcing for or against it a substantive right, but on a motion by any
party or on the court’s own motion the true name may be substituted.

TEX. R. CIV. P. 28. Cap City contends that Exeter did not sue Car Ko—the correct

entity—by filing suit against it “in its partnership, assumed or common name.” Cap

City argues that instead, Exeter “sued the wrong entity.” Citing Moore v. Hooters of

America, LLC, No. 11-21-00168-CV, 2023 WL 2697772, at *4 (Tex. App.—

Eastland Mar. 30, 2023, pet. denied) (mem. op.), Cap City argues that rule 28 does

not apply under these facts.

In Moore, the plaintiff was injured at a Hooters restaurant that was owned and

operated by TW Restaurant Holder, LLC (TWR). Id. at *1. Hooters of America,

LLC was a parent business entity to TWR. Id. The plaintiff sued and served Hooters

of America, LLC, and that entity filed a timely sworn verified denial asserting a

defect as to parties. Id. Hooters of America, LLC then filed a motion for summary

judgment on the ground that it was not a proper party to the lawsuit. Id. at *3. Moore

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responded that under rule 28, TWR was properly sued by naming Hooters using its

“assumed or common name.” Id. The court of appeals rejected Moore’s argument,

concluding that rule 28 did not apply where Moore sued “Hooters of America, LLC”

in its “proper corporate name,” rather than suing “Hooters,” its “common name.” Id.

at *4. The court explained that rule 28 did not apply where Moore sued “the wrong

entity,” rather than misnaming the correct entity. Id.

Exeter distinguishes Moore, arguing that “Cap City is a party to the

Agreement and it identified itself in the Agreement as the assumed name or ‘d/b/a’

of Car Ko.” Further, unlike Hooters of America, LLC, Cap City did not file a timely

sworn verified denial or otherwise allege a defect of parties even though the record

reflects proper service of process on Cap City. See id. at *1. There is nothing on the

face of the record to support Cap City’s contention that it is not a party to the

Agreement. We overrule Cap City’s second issue.

3. Personal jurisdiction

In its first issue, Cap City argues that “Texas does not have personal

jurisdiction over Cap City Motors, LLC.” The Agreement expressly provides,

however, that Texas law applies and each party submits to the exclusive jurisdiction

and venue of courts in Dallas County for any suit arising out of or relating to the

Agreement. “When claims fall within the scope of a forum-selection clause,

application of the Texas long-arm statute and analysis of a defendant’s contacts with

Texas are unnecessary.” Southampton Ltd. v. Four Horsemen Auto Grp., Inc.,

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No. 05-14-01415-CV, 2016 WL 3964731, at *4 (Tex. App.—Dallas July 20, 2016,

no pet.) (mem. op.); see also RSR Corp. v. Siegmund, 309 S.W.3d 686, 704 (Tex.

App.—Dallas 2010, no pet.) (collecting cases).

Exeter has pleaded that Cap City breached “representations, warranties, or

covenants” it made in the Agreement and committed fraud by falsely representing

“that the vehicles contained certain equipment options that purportedly increased the

value of the vehicles (as collateral).” Because Exeter has filed a “legal suit, action

or proceeding arising out of, relating to or based upon th[e] Agreement,” Cap City

has expressly consented to the “exclusive jurisdiction and venue” of courts in Dallas

County, Texas. Accordingly, we need not consider Cap City’s contentions that it

lacks minimum contacts with Texas. See Southampton, Ltd., 2016 WL 3964731, at

*4. We overrule Cap City’s issues.

CONCLUSION

The trial court’s judgment is affirmed.

240296f.p05 /Maricela Breedlove/
MARICELA BREEDLOVE
JUSTICE

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Court of Appeals
Fifth District of Texas at Dallas
JUDGMENT

CAP CITY MOTORS, LLC, On Appeal from the 192nd Judicial
Appellant District Court, Dallas County, Texas
Trial Court Cause No. DC-23-09761.
No. 05-24-00296-CV V. Opinion delivered by Justice
Breedlove. Justices Nowell and
EXETER FINANCE, LLC, Appellee Miskel participating.

In accordance with this Court’s opinion of this date, the judgment of the trial
court is AFFIRMED.

It is ORDERED that appellee Exeter Finance, LLC recover its costs of this
appeal from appellant Cap City Motors, LLC.

Judgment entered this 18th day of November, 2024.

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