Reversed and Remanded and Memorandum Opinion filed July 26, 2012.




                                        In The

                     Fourteenth Court of Appeals

                                 NO. 14-11-00574-CV


                            ANNA H. AYERS, Appellant

                                          V.

                      TARGET NATIONAL BANK, Appellee


                On Appeal from the County Civil Court at Law No. 4
                              Harris County, Texas
                          Trial Court Cause No. 967255


                   MEMORANDUM OPINION

      Appellee, Target National Bank (“Target”), sued appellant, Anna H. Ayers, for
breach of contract, seeking to recover the balance allegedly due under a credit-card
agreement. Target filed a motion for summary judgment, to which Hill responded. On
March 25, 2011, the trial court signed an order granting summary judgment and awarding
Target $5,345.25 plus $500 in attorney’s fees, costs, and post-judgment interest. In two
appellate issues, Ayers challenges the summary judgment. We reverse and remand.
                                 STANDARD OF REVIEW

       A party moving for traditional summary judgment must establish there is no
genuine issue of material fact and it is entitled to judgment as a matter of law. See Tex.
R. Civ. P. 166a(c); Provident Life & Accident Ins. Co. v. Knott, 128 S.W.3d 211, 215–16
(Tex. 2003). A plaintiff moving for summary judgment must conclusively prove all
essential elements of its claim. Cullins v. Foster, 171 S.W.3d 521, 530 (Tex. App.—
Houston [14th Dist.] 2005, pet. denied) (citing MMP, Ltd. v. Jones, 710 S.W.2d 59, 60
(Tex. 1986)). If the movant establishes a right to summary judgment, the burden shifts to
the non-movant to present evidence raising a material fact issue. See M.D. Anderson
Hosp. & Tumor Inst. v. Willrich, 28 S.W.3d 22, 23 (Tex. 2000); Centeq Realty, Inc. v.
Siegler, 899 S.W.2d 195, 197 (Tex. 1995). We review a summary judgment de novo.
Valence Operating Co. v. Dorsett, 164 S.W.3d 656, 661 (Tex. 2005). We take all
evidence favorable to the non-movant as true and indulge every reasonable inference and
resolve any doubts in her favor. Id.

                                        ANALYSIS

       To prevail on a breach-of-contract claim, a plaintiff must prove (1) a valid contract
existed between the plaintiff and the defendant, (2) the plaintiff tendered performance or
was excused from doing so, (3) the defendant breached the terms of the contract, and (4)
the plaintiff sustained damages as a result of the defendant’s breach. West v. Triple B
Servs., LLP, 264 S.W.3d 440, 446 (Tex. App.—Houston [14th Dist.] 2008, no pet.).
Parties form a binding contract when the following elements are present: (1) an offer; (2)
an acceptance in strict compliance with the terms of the offer; (3) meeting of the minds;
(4) each party’s consent to the terms; and (5) execution and delivery of the contract with
the intent that it be mutual and binding. Wal-Mart Stores, Inc. v. Lopez, 93 S.W.3d 548,
555–56 (Tex. App.—Houston [14th Dist.] 2002, no pet.). To be enforceable, a contract
must be sufficiently certain to enable a court to determine the rights and responsibilities
of the parties. McElroy v. Unifund CCR Partners, No. 14-07-00661-CV, 2008 WL
4355276, at *4 (Tex. App.—Houston [14th Dist.] Aug. 26, 2008, no pet.) (mem. op.)

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(citing T.O. Stanley Boot Co. v. Bank of El Paso, 847 S.W.2d 218, 221 (Tex. 1992)). The
material terms of a contract must be agreed upon before a court can enforce the contract.
Id. (citing T.O. Stanley Boot, 847 S.W.2d at 221).
       In two issues, Ayers contends (1) the only summary-judgment evidence regarding
the terms of the contract at issue was inadmissible, or (2) alternatively, even if all of
Target’s summary-judgment evidence were admissible, Target failed to prove the terms
of the contract.
       To support its motion for summary judgment, Target presented (1) the affidavit of
its representative, Kevin Bendix, with an attached monthly statement for Ayers’s account
and her credit-card application, (2) the affidavit of Target’s counsel relative to attorney’s
fees, and (3) Ayers’s response to Target’s request for admissions.
       In his affidavit, Bendix averred,
       1. I am a representative of Target National Bank and am authorized to
          verify current balances due and owing to Target National Bank on credit
          card accounts.

       2. As of the date of this affidavit I have reviewed the records of the above
          listed person and account, and that the amount due and owing to Target
          National Bank on this account, over and above all known legal set-offs
          is $5,345.25.

       3. [a statement that Ayers is not known to be in the military]

           That the above information is true to the best of my knowledge,
           information and belief, and based upon the books and business records
           of Target National Bank.

       In her response, Ayers presented three objections to Target’s summary-judgment
evidence: (1) Bendix failed to state his averments were based on personal knowledge; (2)
the attached monthly statement and credit-card application were not properly
authenticated and constituted hearsay, without proof of the business-records exception;
and (3) Bendix’s averment regarding the balance due was conclusory because it was not
supported by any admissible evidence. The trial court overruled all of these objections.


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       On appeal, Ayers reurges the objection that the monthly statement and the
application constituted hearsay and were not properly authenticated; as Ayers
emphasizes, these documents were not even referenced in Bendix’s affidavit. See Tex. R.
Evid. 803(6), 902(10). Nonetheless, we need not decide whether the documents were
admissible because, even if we consider them, Target’s summary-judgment evidence was
legally insufficient to prove the terms of the credit-card agreement, much less that the
amount allegedly due comported with the terms and Ayers breached the agreement by
failing to pay this amount.
       Significantly, Target did not present the actual cardholder agreement.       In its
motion and accompanying exhibit list, Target stated the applicable agreement was
attached to Bendix’s affidavit, but no such agreement was attached. Even if this omission
was merely an oversight, as summary-judgment movant, Target bore the burden to
establish the terms of the agreement. See Knott, 128 S.W.3d at 215–16; Cullins, 171
S.W.3d at 530.
       Further, in his affidavit, Bendix generally referenced Ayers’s “account” but did
not mention any agreement, set forth any terms, or aver that Ayers agreed to be bound by
any terms.   Bendix’s general assertion that $5,345.25 was “due and owing” on the
account did not demonstrate how this balance was calculated, whether the calculations
comported with the terms of any agreement, and whether Ayers agreed to pay such
balance under an agreement.
       Moreover, contrary to the reference in Target’s motion and exhibit list to “account
statements” in the plural, Target presented only one statement. This statement, issued
shortly after Target filed suit, showed a balance of $5,345.25 carried over from the
previous statement, without further activity. The statement does not contain any terms of
an agreement, indicate how the balance was calculated, including various charges and
fees, or show that the balance was calculated per the terms of an agreement.
       For example, an applicable interest rate is a material term of a credit-card
agreement.   See McElroy, 2008 WL 4355276, at *4 (citing T.O. Stanley Boot, 847
S.W.2d at 221). The monthly statement reflects “Total fees charged in 2010” of $156

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and “Total interest charged in 2010” of $375.21. Because Target presented only one
statement, it is unclear whether it also charged interest and fees for previous years,
considering that Ayers applied for the card in 2004. Regardless, Target presented no
evidence demonstrating Ayers agreed to pay interest and fees, much less how the interest
and fees would be calculated, such as the applicable interest rate. The monthly statement
also contains the following general language, “Your Annual Percentage Rate (APR) is
the annual interest rate on your account”; but, again, there is no evidence demonstrating
the APR or interest rate that Ayers allegedly agreed to pay. In fact, at one point the
statement reflects an APR of “0.00%” for purchases and cash advances. Some of the
language above this information is illegible; thus, it is unclear whether Target was no
longer charging interest on the balance or whether this 0.00% APR is inconsistent with
the other information on the statement showing interest and fees were charged, at least
for some portion of 2010.
      Additionally, a portion of the form language on the credit-card application is
illegible, and all the form language is apparently written in Spanish, but Target provided
no translation to support its motion for summary judgment. The only legible portion of
the application that is written in English is the contact and identification information
apparently completed by Ayers and her purported signature. The credit-card application
does not contain any legible terms of an agreement that are written in English.
      Target asserts that, in response to its request for admissions, Ayers admitted “an
agreement was formed and breached.” We disagree that Ayers admitted she breached the
agreement. Specifically, Ayers admitted the following:

      You and [Target] entered into and [sic] agreement.

      [Target] extended you credit.

      Using the credit extended by [Target], you made purchases from third
      parties.




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      You made no objections to any charges under the Agreement despite
      receiving notice of such charges more than sixty (60) days prior to the
      filing of this lawsuit.

      You have failed to repay [Target].

However, Ayers responded that she was unable to admit or deny the following without an
opportunity to review the original cardholder agreement and any amendments thereto:
      Under the Agreement, you became bound to pay [Target] the amounts of
      any purchases you made, plus additional charges.1

      The Agreement provides that you may object, in writing and within sixty
      (60) days of notice of the charge, to any disputed charges under the
      Agreement.

      The terms of the Agreement control the accrual of additional charges,
      interest, and other amounts.

Ayers also responded that she was unable to admit or deny the following without an
opportunity to review a complete payment history and all monthly statements on the
account:
      The unpaid balance under the Agreement became due on or before April
      23, 2010.

      The current balance due, owing, and unpaid under the Agreement, after
      allowing all just and lawful payments, credits, and offsets totaled not less
      than $5,345.25.

      Thus, at most, Ayers admitted she had a credit-card agreement with Target, made
purchases on the account, did not object to any charges when she received notice, and
“failed to repay” Target for some amount. Absent is any admission regarding Ayers’s
specific obligations under the agreement. Because the “failed to repay” admission is so
general and not linked to any other admissions, it is unclear what amount Ayers
admittedly “failed to repay.” To the extent “failed to repay” refers to purchases made on
the card, Ayers did not further admit she was bound under the agreement to pay such

      1
          In its appellate brief, Target incorrectly asserts that Ayers admitted this fact.

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charges or the total amount claimed by Target in this suit. As mentioned above, the
monthly statement indicated that the balance claimed by Target included interest and
other fees. Without the benefit of reviewing the agreement and all monthly statements,
Ayers declined to admit she was bound to pay any amounts, including “additional
charges,” or that the terms of the agreement control these “additional charges, interest,
and other amounts.” To the extent “failed to repay” refers to the total amount claimed by
Target in this suit, Ayers’s admission does not constitute an acknowledgement that the
amount is actually owed under the terms of the agreement—again, an admission Ayers
declined to make absent an opportunity to review the agreement. In its motion, Target
cited Ayers’s admission that she did not object to any charges. However, absent proof of
the terms of the agreements, there is no evidence demonstrating the consequences of
Ayers’s failure to object; i.e. whether she is bound to pay any such undisputed charges, as
suggested by Target.

       The present case is similar to McElroy, in which our court held the evidence was
legally insufficient to support the trial court’s finding after a bench trial that a valid
credit-card contract existed. 2008 WL 4355276, at *4–5. In McElroy, the assignee
creditor proffered the following evidence: (1) an affidavit of its employee; (2) a signature
card for the account; (3) an affidavit of an employee of the account assignor; and (4)
numerous monthly account statements, reflecting purchases and payments made against
the account. Id. at *1, 4. However, the creditor did not proffer the cardholder agreement
or any other document establishing agreed terms for the account, such as the applicable
interest rate or the method of determining finance charges. Id. at *4. Further, the
monthly statements showed “widely varying” interest rates, and the signature card did not
contain the missing contractual terms. Id. Consequently, the creditor’s evidence lacked
an express written agreement describing the definite, agreed terms between the
cardholder and creditor, and there was no “discernable demonstration” of the
cardholder’s intent to be bound by a specific agreement. Id. In fact, the court indicated,
when upholding the creditor’s recovery under a separate quantum-meruit theory, that the
cardholder admitted the existence and use of the account. See id. at *6. Although the
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court did not specifically discuss these admissions relative to the breach-of-contract
theory, the admissions obviously did not alter the court’s conclusion that the creditor
failed to prove a valid contract. See id. at *4–5;2 see also Williams v. Unifund CCR
Partners Assignee of Citibank, 264 S.W.3d 231, 236 (Tex. App.—Houston [1st Dist.]
2008, no pet.) (holding that, although creditor’s summary-judgment evidence, including
affidavits and account statements, might indicate parties had reached an agreement of
some kind, evidence was insufficient to establish terms of valid contract as a matter of
law because creditor failed to produce actual credit-card agreement or any other
document establishing agreed terms, including applicable interest rate or method for
determining finance charges).

       The McElroy court distinguished its case from Winchek v. American Express
Travel Related Services Co., Inc., 232 S.W.3d 197, 204 (Tex. App.—Houston [1st Dist.]
2007, no pet.), in which the First Court of Appeals held that the creditor established
existence of a contract. See McElroy, 2008 WL 4355276, at *5. The Winchek creditor
presented a copy of the “Personal Card Member Agreement,” billing statements, and an
affidavit from the creditor’s Manager of Credit Operations. 232 S.W.3d at 202–04. The
“Personal Card Member Agreement” expressly stated that retention or use of the card
demonstrated the cardholder’s agreement to its terms and included terms for calculating
interest and other fees. Id. at 203. The creditor’s affiant averred that “[b]y accepting and
using the Personal Card, [the cardholder] agreed to all of the terms and conditions set
forth in the Personal Card Member Agreement . . . .” Id. at 202–03.

       Similar to the situations in McElroy and Williams, it is undisputed there was a
credit-card agreement of some kind between Target and Ayers and she made purchases
on the card, but the significant factor is the lack of any evidence proving the terms of that
agreement or Ayers’s intent to be bound by a specific agreement.                  Therefore, the
evidence that was sufficient in Winchek is absent in the present case. See Jaramillo v.


       2
          Unlike the McElroy creditor, Target pleaded only breach of contract—not quantum meruit or
any other alternative theory. See 2008 WL 4355276, at *1, *5–6.

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Portfolio Acquisitions, LLC, No. 14-08-00939-CV, 2010 WL 1197669, at *5 (Tex.
App.—Houston [14th Dist.] Mar. 30, 2010, no pet.) (mem. op.) (citing McElroy,
Williams, and Winchek when noting that our court and sister court have distinguished
between cases where cardholder agreement is entered into evidence and where there is no
cardholder agreement).    In fact, in its motion for summary judgment, Target cited
Winchek as holding “a valid contract was formed by evaluating the terms of the
cardmember agreement” and stated pertinent language in Ayers’s agreement was nearly
identical to language in the Winchek agreement regarding use of the credit card
constituting acceptance of the agreement. However, as discussed above, Target did not
present the cardholder agreement or demonstrate the language was analogous to the
language in the Winchek agreement.
      Accordingly, we conclude the trial court erred by granting summary judgment in
favor of Target. We sustain Ayers’s second issue, reverse the trial court’s judgment, and
remand for further proceedings.




                                               /s/    Charles W. Seymore
                                                      Justice



Panel consists of Chief Justice Hedges and Justices Seymore and Brown.




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