TEXAS COURT OF APPEALS, THIRD DISTRICT, AT AUSTIN
NO. 03-25-00505-CV
The Seely Group, LLC; Dallas Seely; and Amy Seely, Appellants
v.
David James Martin a/k/a David James, Appellee
FROM THE 200TH DISTRICT COURT OF TRAVIS COUNTY
NO. D-1-GN-23-001265, THE HONORABLE MAYA GUERRA GAMBLE, JUDGE PRESIDING
MEMORANDUM OPINION
The Seely Group, LLC; Dallas Seely; and Amy Seely appeal the trial court’s
judgment following a bench trial in this dispute between a real-estate agent and his former agency.
We reverse the judgment holding Dallas individually liable and reform the judgment as to the
damages award conditioned on Martin filing a remittitur within thirty days of the date of this
opinion. We otherwise affirm.
BACKGROUND
David James Martin began his career in the military and served as an intelligence
analyst in the Army. After leaving the Army, Martin worked in personal fitness and eventually
opened about four gyms in California. In 2020, Martin and his family decided to move to Texas
and “slow down a bit” to spend more time with family. He got his Texas real-estate license in
October 2021 as a way “to make a good amount of money with the sales experience that I had already” and have the flexibility to be more involved in his son’s life. Martin initially worked with
his wife’s cousin “to learn the basics of the industry” before he “felt the need to join one of the
best brokerages” where he could “learn the most.” In February 2022, Martin joined the Seely
Group, where he “was promised high-level superior training by superior agents,” even though “the
commission split was the lowest in the industry” at 60 percent to the agency and 40 percent to him,
from which additional fees were withdrawn to pay the Seely Group’s then-broker, Keller Williams
Expansion Network.
The Seely Group is an Austin-based real estate agency owned by husband-and-wife
team Dallas and Amy Seely. Dallas is the Seely Group’s CEO, as well as a real-estate agent, and
Amy is the Seely Group’s current sponsoring broker. Dallas described their agency as “top
.1 percent in the marketplace.” Because real estate is the “highest failure rate sales industry,”
Dallas testified that “we wanted to give every single opportunity to anyone who would partner
with us to be successful in real estate,” so “I made a decision early on to invest hundreds of
thousands of dollars into outside industry experts,” offered “on top of all the internal training that
they got from our history of success.” Dallas testified that this training included a “90 days to
success program,” two outside sales coaches, and “access to mentorship and public speakers.”
Dallas testified that “the reason people join my company is me, is the training and the things I
taught them and the internal and all the documents, the scripts, the recordings, the videos, and you
know, respectfully, my history of success speaks for itself.” In sum, Dallas testified that the Seely
Group’s agents would get “daily” internal training, plus periodic outside training, as well as access
to lead-generation software. Michelle Bippus, who testified regarding the training at the Seely
Group, characterized the training offered by the Seely Group as “basic real estate training.”
2
By mid-2022, the Seely Group had “42 or 45 agents” and had been operating
without an independent-contractor agreement for its agents, including Martin. “We were starting
to notice that agents would come in, they would be with us for however many months or longer,
they would basically get all this world-class training, and then, once they did, they would say, hey,
thank you so much for turning me into a superstar, I’m going to go off on my own.” After
“instances where agents were leaving, stealing money, stealing clients, [and] stealing listings,”
Dallas testified that “we had to come up with an agreement” to “have a win-win for the partner
agent and the company” and “protect[] the company from some of these instances.”
The Seely Group developed an Independent Contractor Agreement (the Contract)
that it required its agents to sign. Contract provisions relevant to this dispute include (1) a
post-separation training fee which required that, within five business days of an agent’s separation
from the Seely Group, the agent was to pay a training fee amount that varied depending on the
period of time that the agent had been contracted with the Seely Group: $2,500 for 90 days or
less; $5,000 for 90 days or more but less than six months; and $7,500 for more than six months;
(2) a $997 administrative fee provision that required that, upon the closing of any purchase or sale
of real estate by a company client, the agent “should request” that the fee “be paid by the client
and include it in the representation agreement,” but if the client refuses to pay the fee, “it will be
deducted from the Agent Share of the commission”; and (3) an exempt personal-transaction
provision, which allowed agents to “act as their own representative in one purchase, sale, or lease
of real estate each calendar year without paying a commission split to the [Seely Group].”
Dallas testified that when an agent was presented with the Contract, someone from
the Seely Group’s “Executive Team would actually sit down with them in person, and . . . go over
every single line of the [Contract], read out loud, and then not only where it says in the [Contract]
3
but also tells them in person, hey, there’s no pressure to sign this,” and “if you want to sleep on
this, if you want to have your attorney or any kind of counsel review it, you’re more than welcome,
but we want to really go above and beyond in communicating what our expectations and what this
agreement says.” But the Contract was not well received, and the Seely Group lost “a large
majority of our sales force” over it.
When the Seely Group presented Martin with the Contract, his financial status was
“tight,” as he had just gone through “a big career change” and had been in real estate “just over six
months.” In the short time that Martin had been with the Seely Group, “there was absolute chaos
at the agency,” and “I essentially did the first 90 days by myself.” And “I didn’t receive any leads
from [the Seely Group].” Martin expressed to Dallas his two main concerns about the Contract:
the provisions regarding the training fee assessed to agents after separation and the administrative
fee. Martin testified, “I don’t think I’ve ever seen a company[’s] training fees increase the longer
you’re there, especially because the training that I was promised wasn’t anything near what was
received.” Dallas maintained that this amount increases over time because agents are “getting
more and more high-level training. The longer an agent is with our organization, the higher they
are trained up, the more we are spending to pour into them.” As to the administrative fee, Martin
testified that Dallas “started talking about these fees . . . a month approximately before the
contract,” and “there was a big stink in the office that we are charging clients more but actually
not offering them more services.”
When Martin raised these concerns to Dallas, Dallas told him, “you’re one of my
best guys and you’ve been loyal through everything I’ve been through, and I would never do that
to you.” As to the training fee specifically, Dallas said, “that’s not something you’re going to have
to worry about, just sign it, it’s more of a formality than anything else, it’s not essentially for you.”
4
As to the administrative fee, Dallas “reassured” Martin that “I trust you, you’re a good agent, it’s
not something you’re going to have to worry about.” Martin testified that he believed Dallas. But
Martin testified that Dallas also told him that “he would have to let me go” if Martin did not sign
the Contract.
Martin signed the Contract. “I considered [Dallas] a friend and a mentor.” “We
went to church together,” and “I trusted him.” But he testified, “as a businessowner previously
myself, I knew better.” Still, even after Martin signed the contract, he maintains that Dallas told
him that the administrative fee would not be taken out of commission “to me and a few others.”
And Shea Mworia, the Seely Group’s director of operations from March 2022 through April 2023,
testified that “multiple” agents, including Martin, were told “if you’re working hard it won’t affect
you, as long as you’re trying to obtain it”—“we weren’t going to let it kill a deal.” However,
Dallas disagreed and testified that he never told Martin or other agents that he would not enforce
terms in the Contract.
In October 2022, Martin’s wife was seriously injured in an accident, and their
family incurred unexpected medical bills over the next few months. In late December 2022 or
early January 2023, Martin told Dallas about his family’s difficult financial situation and asked if
one of the properties he was working to close—a commercial lease at 500 E. 5th Street—could
qualify as his annual exempt personal transaction. Martin testified that this property “was a lead
that I already had,” so he “didn’t think it fell under the provisions of the [C]ontract.” Dallas denied
Martin’s request. But he agreed to extend Martin an interest-free loan. Martin remembers it as
Dallas’s “suggestion” and that Dallas “offered an advance on future commissions” that “would be
paid back over time” over multiple transactions.
5
On February 15, 2023, the Seely Group wired Martin $8,708.25. Martin had two
deals—the 500 E. 5th Street lease, plus a residential sale on Knights Branch Drive—that had
recently been completed, but his commission had not yet paid out. Given Martin’s financial
situation, Dallas testified that he agreed to advance Martin the money but “very purposely” labeled
it as an “advance/loan” in the wire details.
Ten days later, Dallas sent Martin an email to which he attached the disbursement
authorization form for 500 E. 5th street and a spreadsheet “of how the loan would be paid back”
through the two property distributions. Dallas testified that he was trying to “overcommunicate in
advance” “because of how hypersensitive [Martin] was” and to “get ahead of any unnecessary
emotions because of a numbers miscommunication.” However, in calculating the amount that
Martin owed the Seely Group, Dallas accidentally applied a .5% transaction fee—a provision that
applied to later independent-contractor agreements that the Seely Group issued, but not the one
that Martin signed. Dallas also accidentally applied an administrative fee—which applied only to
sales—to the lease deal. With these errors, the spreadsheet indicated that Martin would not receive
any funds from the 500 E. 5th Street or Knights Branch Drive closings, as those funds would be
paid back to the Seely Group, and that Martin still owed the Seely Group $3,697.39. 1 Dallas told
Martin to “take a look and call me today to discuss what you want to do.”
1 The spreadsheet showed the following proposed breakdown:
Address Sales Total GCI Comp Martin’s Transaction Admin
Price Split Split Fee Fee
500 E. 5th St. 323,967.60 9,719.03 4,261.31 2,840.88 1,619.84 997 Knights 256,878 7,706.34 3,254.97 2,169.98 1,284.39 997 Branch Dr.
2/15 Wired: $8,708.25
Martin Commissions: $5,010.86
6
Martin was surprised when he saw the proposed breakdown, as he had not
anticipated that the .5% transaction fee on both properties (totaling $2,904.23),
$997 administrative fee on both properties (totaling $1,994), and Keller Williams “caps & royalty
fees” 2 would be deducted from his 40% commission, leaving Martin with, as he characterized it,
“approximately 5% of the total commission earned.” Martin wrote back to ask about the assessed
fees. “I wasn’t supposed to be charged the transaction fee that was being assessed,” and “I was
trying to get in contact with [Dallas] about that.” But “Dallas refused to speak with me.” Dallas
characterizes Martin’s response to his email (which is not in the record) as going “off the deep
end” and making “threats” to the company, like that he would “burn the company to the ground.”
Dallas testified that “I refused to sit down with him in person” or respond to Martin’s requests to
talk because of these “threats” and instead asked two members of his staff, Mworia and Jonathan
Pylant, to meet with Martin.
At that meeting, Martin, Mworia, and Pylant agreed that Martin was not supposed
to be assessed certain fees that Dallas included in the spreadsheet. However, the next day Pylant
told Martin that “Dallas has instructed me to have you leave the office, it is effective immediately,
and you are to return all your materials.” Martin also testified that Pylant confirmed that he was
“not supposed to be assessed these [administrative and transaction] fees.” To maintain his ability
to practice real estate, Martin transferred his license to a new broker the same day.
Martin continued to ask Dallas if he would meet with him over the following days,
but Dallas never responded. On March 7, Martin wrote Dallas and Amy to express his
Delta owed to the Seely Group: $3,697.39
2 This amount, which is included in the Disbursement Authorization forms for each property, is $1,010.78 for 500 E. 5th Street and $838 for Knights Branch Drive.
7
disappointment over the dispute and “in hopes that we can put this behind us in a peaceful manner.”
He sought “clarification of the contract status concerning fees” and listed five clients to ask “how
these will be assessed.” He said that “I need a written notice from you . . . acknowledging and
agreeing to release me,” and “I will pay you the balance of what I owe you from the advance.”
Martin emphasized he did not “wish to escalate this any further.” But he noted that if he did not
hear from Dallas by the end of the day, he “will assume you will be taking legal action and we will
do what is necessar[y] for our family.” Martin also sent a letter to Keller Williams’ corporate
office detailing the dispute, contending that “I consider my contract with your company (The Seely
Group) void,” and raising “a possibility of RESPA [Real Estate Settlement Procedures Act]
violations regarding fees charged to clients.”
On March 14, 2023, the Seely Group sued Martin for breaching the Contract and
sought repayment of the advance, payment of the post-termination fees, including the
$7,500 training fee, and injunctive relief based on the Contract’s noncompete provision. After a
hearing, the Seely Group secured a temporary injunction prohibiting Martin from, among other
activities, conducting residential real-estate work in Austin, Lago Vista, Georgetown, Bastrop,
and Buda.
Martin represented himself for much of this lawsuit and filed his pleadings, which
asserted counterclaims against the Seely Group, as well as Dallas and Amy individually, pro se.
Though Martin eventually secured counsel and was represented at trial, he went to trial on his first
amended answer and counterclaim, which he filed pro se. At trial, the Seely Group, Dallas, and
Amy proceeded on their claims for breach of contract, money had and received, and attorney’s
fees. Martin proceeded on his claim for breach of contract based on the Seely Group’s failure to
provide “specialized training,” denial of his request for a personal transaction, and withholding of
8
amounts owed to him; fraudulent inducement to enter the Contract; violations of the Texas Real
Estate Act; and attorney’s fees under Chapter 38 of the Civil Practice and Remedies Code.
Following a two-day bench trial, the trial court rendered judgment that awarded
Martin $20,714.17, as well as court costs and fees, assessed against Dallas and the Seely Group.
The judgment did not specify which of Martin’s claims it granted relief on, and it ordered that the
Seely Group take nothing from Martin. It left open a future award of attorney’s fees to Martin.
The Seely Group, Dallas, and Amy (collectively, appellants) requested findings of
fact, and after a hearing on Martin’s request for attorney’s fees—which the trial court ultimately
denied—the trial court issued findings of fact and conclusions of law, including that:
• Martin and the Seely Group are the parties to the Contract.
• The $8,708.25 wired to Martin was “an advance on future commissions from the
sale at 500 East 5th Street,” so the Seely Group “is not entitled to repayment.”
• Martin was not obligated to pay transaction fees.
• Dallas, on the Seely Group’s behalf, “improperly deduc[t]ed from Martin’s
commission” $2,904.23 in transaction fees and $1,994 in administrative fees.
• Martin’s property at 500 E. 5th Street did not involve a “company originated client
because Martin’s relationship arose with the client prior to being under” the
Contract and the client was not referred to Martin by the Seely Group. Thus, the
Seely Group was not entitled to 60% commission, the contract-to-close fee, or the
administrative fee on that deal.
• The Seely Group was not entitled to an offset of funds advanced to Martin because
it did not properly plead it as an affirmative defense.
• The corporate veil was pierced, and Dallas is liable for breach of the Contract
because the Seely Group is Dallas’s alter ego, Dallas used the Seely Group “to
perpetuate actual fraud by intentionally making material misrepresentations to
Martin regarding the assessment of fees against Martin’s commissions,” and “the
representations were made for Dallas Seely’s direct personal benefit.”
9
• The Contract’s attorney’s fees provision is unconscionable because it allows the
Seely Group to recover an unlimited amount of attorney’s fees “but completely bars
Martin’s recovery of the same.”
Appellants perfected this appeal.
STANDARD OF REVIEW
In an appeal from a bench trial, we review a trial court’s legal conclusions de novo,
affirming the judgment on any legal theory that finds support in the evidence. Hegar v. El Paso
Elec. Co., 629 S.W.3d 518, 527 (Tex. App.—Austin 2021, pet. denied) (citing BMC Software
Belg., N.V. v. Marchand, 83 S.W.3d 789, 794 (Tex. 2002)). Unchallenged findings of fact are
binding on the appellate court unless the contrary is established as a matter of law or there is no
evidence to support the finding. Id. (citing McGalliard v. Kuhlmann, 722 S.W.2d 694, 696 (Tex.
1986)). When challenged, we review the trial court’s findings for legal and factual sufficiency.
Iliff v. Iliff, 339 S.W.3d 126, 134 (Tex. App.—Austin 2009), aff’d, 339 S.W.3d 74 (Tex. 2011).
An attack on the sufficiency of the evidence must generally be directed at specific findings of
fact rather than the judgment as a whole. Crowder v. Sanger, No. 03-21-00291-CV,
2023 WL 4631501, at *9 (Tex. App.—Austin June 30, 2023, pet. granted, judgm’t vacated w.r.m.)
(mem. op.). It is the appellant’s duty to challenge the trial court’s express and implied findings.
Long v. Long, 234 S.W.3d 34, 42 (Tex. App.—El Paso 2007, pet. denied).
When an appellant challenges the legal sufficiency of the evidence supporting an
adverse finding, appellate courts consider only the evidence and inferences, when viewed in their
most favorable light, that tend to support the finding and disregard all evidence and inferences to
the contrary. Catalina v. Blasdel, 881 S.W.2d 295, 297 (Tex. 1994). When the appellant
challenges an issue on which it did not have the burden of proof at trial, it must demonstrate on
10
appeal that there is no evidence to support the trial court’s adverse findings. Affordable Power,
L.P. v. Buckeye Ventures, Inc., 347 S.W.3d 825, 830 (Tex. App.—Dallas 2011, no pet.) (citing
Croucher v. Croucher, 660 S.W.2d 55, 58 (Tex. 1983)). And when the appellant challenges the
legal sufficiency of an adverse finding on an issue on which it had the burden of proof at trial, it
must demonstrate on appeal that the evidence conclusively established, as a matter of law, all vital
facts in support of the issue. New York Party Shuttle, LLC v. Bilello, 414 S.W.3d 206, 211 (Tex.
App.—Houston [1st Dist.] 2013, pet. denied). We consider the evidence in the light most favorable
to the verdict and indulge all reasonable inferences in its support. Id. (citing City of Keller
v. Wilson, 168 S.W.3d 802, 827 (Tex. 2005)).
When an appellant challenges the factual sufficiency of the evidence, we consider
all the evidence and set aside the finding only if it is so contrary to the overwhelming weight of
the evidence as to be clearly wrong and unjust. Cain v. Bain, 709 S.W.2d 175, 176 (Tex. 1986).
The trial court, as trier of fact and the sole judge of the credibility of the witnesses, is free to draw
its own deductions from all the evidence and is not bound by the testimony of any witness. Sieber
& Calicutt, Inc. v. La Gloria Oil & Gas Co., 66 S.W.3d 340, 347 (Tex. App.—Tyler 2001, pet.
denied); see Southwestern Bell Tel. Co. v. Garza, 164 S.W.3d 607, 625 (Tex. 2004). The trial
court’s findings are binding unless they are supported by no evidence or so against the great weight
of the evidence as to be manifestly unjust. Sieber & Calicutt, 66 S.W.3d at 347.
DISCUSSION
Appellants raise eight issues on appeal, arguing that the trial court erred (1-2) by
finding fraud against Dallas and the Seely Group (a) despite the Contract’s disclaimer-of-reliance
provision and (b) given that the alleged misrepresentations contradicted the Contract’s language;
11
(3) by piercing the Seely Group’s corporate veil; (4) by finding the Contract’s attorney fee shifting
provision unconscionable; (5) by finding that the Seely Group breached the Contract; (6) by
declining to apply an offset for the amount they contend Martin owed the Seely Group; (7) in
calculating damages; and (8) in awarding a take-nothing judgment against the Seely Group. We
address the issues involving Martin’s claims in the trial court first (issues 1, 2, 3, and 5), then
address the issues involving the Seely Group’s affirmative defense and claims (issues 4, 6, and 8),
and last address damages (issue 7).
Martin’s claims
Breach of contract
In their fifth issue, appellants contend that the trial court erred by awarding damages
to Martin under a breach-of-contract theory. Appellants argue that the Seely Group did not breach
the Contract because it did not “charge any fees” to Martin; rather, it withheld from commissions
payable to Martin the $7,500 training fee that Martin owed upon his separation from the Seely
Group (but that Martin had not paid), and Martin’s balance on the loan exceeded his commissions.
We consider appellants’ offset and damages calculation arguments below and decide here whether
appellants have established that insufficient evidence supports the trial court’s judgment in
Martin’s favor on his breach-of-contract claim.
“Breach of contract requires pleading and proof that (1) a valid contract exists;
(2) the plaintiff performed or tendered performance as contractually required; (3) the defendant
breached the contract by failing to perform or tender performance as contractually required; and
(4) the plaintiff sustained damages due to the breach.” Plan B Holdings, LLC v. RSLLP,
681 S.W.3d 443, 452–53 (Tex. App.—Austin 2023, no pet.) (quoting Pathfinder Oil & Gas, Inc.
12
v. Great W. Drilling, Ltd., 574 S.W.3d 882, 890 (Tex. 2019)). On appeal, appellants focus on the
third requirement—whether the Seely Group breached by failing to deliver to Martin what he was
owed under the Contract.
Following the trial court’s judgment, appellants requested findings of fact and
conclusions of law. Appellants specifically requested findings on Martin’s breach-of-contract
claim regarding the parties to the Contract, whether Martin paid fees assessed by the Seely Group,
and whether the 500 E. 5th Street property qualified as an exempt personal transaction under the
Contract. Relevant to Martin’s claim for breach of contract, the trial court found:
The parties to the Contract are Martin and the Seely Group.
Martin “substantially performed all of his obligations” under the Contract.
“Fees are deemed paid if deducted from Martin’s commission.”
“There was no contractual obligation for Martin to pay Transaction Fees.”
Dallas 3 and the Seely Group breached the Contract…
by assessing $2,904.23 worth of transaction fees against Martin’s commissions.
by assessing $1,994.00 in administrative fees against Martin’s commissions.
“by wrongfully withholding $7,110.69 of Martin’s commissions.”
“by wrongfully collecting commissions totaling $8,705.25 from the 500 E. 5th
St. transaction.”
Because Martin’s relationship with the 500 E. 5th Street client began before he signed the
Contract and the client did not sign a representation agreement with Martin, that property
“is not covered under the [Contract]” under the Contract’s terms and thus “[the Seely
Group] was not entitled to 60% of the commission from the sale of the property, Contract
to Close Fee, or Administrative Fee.” 4
3 We address appellants’ issue regarding piercing the corporate veil below.
4 The order further stated that the trial court reached this finding because (1) “the client did not sign a representation agreement or listing or otherwise agree[] to utilize Martin’s services
13
The Seely Group “has not paid Martin any commission since February 15, 2023.”
“Martin is the prevailing party under the Agreement . . . .”
Thus, the trial court found that, after Martin substantially performed his obligations
under the Contract, the Seely Group breached the Contract when it assessed fees from Martin’s
commissions contrary to the Contract’s terms and when it collected commission, costs, and fees
on the 500 E. 5th Street property. Sufficient evidence in the record supports these findings as
detailed above, including the undisputed evidence that the Seely Group has not paid Martin
anything for the closing on Knights Branch Drive.
Further, we will uphold the trial court’s legal conclusion if the judgment can be
sustained on any theory supported by the evidence. City of Houston v. Cotton, 171 S.W.3d 541,
546 (Tex. App.—Houston [14th Dist.] 2005, pet. denied). Appellants did not request a finding as
to the Seely Group’s breach of the Contract regarding its promise to “provide[] specialized
training, support, technology, lead-generation, and value-added services to its contract Agents” or
related to its assertion that it properly withheld $7,500 from commission payable to Martin to
account for the post-separation training fee it contends Martin owed but did not pay within five
business days of his separation—allegations Martin raised in support of his breach-of-contract
claim. In a bench trial, when the complaining party requests and the court files findings of fact,
omitted findings can be presumed only when (1) an element of the ground of recovery was included
in the findings of fact; (2) the omitted element has not been properly requested; and (3) the
in the purchase or sale of real estate” and thus is not a “Company Client” under the Contract; and (2) “Martin’s relationship arose with the client prior to being under contract with [the Seely Group] and the client was not referred to Martin by and through [the Seely Group]” such that the client is not a “Company-Originated Client” under the Contract. Appellants have not challenged these findings on appeal.
14
omitted finding is supported by the evidence. Tex. R. Civ. P. 299; American Nat. Ins. v. Paul,
927 S.W.2d 239, 245 (Tex. App.—Austin 1996, writ denied). While appellants requested and the
trial court filed findings as to other elements of Martin’s breach-of-contract claims (e.g., the parties
to the Contract, Martin’s performance, damages), appellants did not request findings (or amended
or additional findings) regarding Martin’s allegations that the Seely Group breached the Contract
because it “failed to provide ‘specialized training’ . . . per the terms of the [Contract].”
Sufficient evidence in the record supports the trial court’s implied finding that the
Seely Group did not provide the training for which it claims it assessed the post-termination
$7,500 training fee. See New York Party Shuttle, 414 S.W.3d at 211. For example, Martin testified
that the training he received “was nothing,” “the training that I was promised wasn’t anything near
what was received,” “there was absolute chaos at the agency” regarding training, and that he
“didn’t receive any leads” from the Seely Group. Bippus also testified that the training that was
made available to agents at the Seely Group was “basic sales training.” Thus, the final judgment
can also be affirmed by sufficient evidence in the record that the Seely Group breached the
Contract by failing to deliver the specialized training as it promised.
Under the requisite standard of review, appellants failed to carry their burden to
show that no evidence supports the trial court’s determination that it breached the Contract.
See Affordable Power, 347 S.W.3d at 830. We overrule appellants’ fifth issue.
Having determined that the judgment in Martin’s favor can be affirmed on a
breach-of-contract theory, we need not consider appellants’ challenge to the trial court’s “fraud
findings” 5 (their first and second issues), which appear to challenge the trial court’s judgment
5The trial court’s only finding involving fraud was that “Dallas Seely used [the Seely Group] to perpetuate actual fraud by intentionally making material misrepresentations to Martin
15
under a theory of fraudulent inducement. See Tex. R. App. P. 47.1; APMD Holdings, Inc.
v. Praesidium Med. Prof’l Liab. Ins., 555 S.W.3d 697, 713 n.7 (Tex. App.—Houston [1st Dist.]
2018, no pet.) (“Because [appellee’s] theories of fraud and breach of fiduciary duty would not
afford it any greater relief than its breach of contract theory, which is sufficient to support the trial
court’s judgment, we need not address [appellant’s] . . . issues concerning the fraud and breach of
fiduciary duty claims.”).
Veil piercing
Appellants argue that the trial court erred by piercing the Seely Group’s corporate
veil and holding Dallas personally liable for the judgment because Martin did not plead any theory
of veil piercing and the issue was not tried by consent. And appellants contend that even if the
issue was properly pleaded or tried by consent, there is no evidence to support the trial court’s
findings. Those findings include that (1) the Seely Group “is the alter ego of Dallas Seely,”
(2) Dallas used the Seely Group “to perpetuate actual fraud by intentionally making material
misrepresentations to Martin regarding the assessment of fees against Martin’s commissions,” and
(3) “the representations were made for Dallas Seely’s direct personal benefit.”
Generally, the owner of a corporation is not liable for the corporation’s contractual
obligations. See Tex. Bus. Orgs. Code § 21.223(a)(2); Dodd v. Savino, 426 S.W.3d 275, 290 (Tex.
App.—Houston [14th Dist.] 2014, no pet.); see also Tex. Bus. Orgs. Code § 101.002(a) (“Subject
to Section 101.114, Section[ ] 21.223 . . . appl[ies] to a limited liability company and the
company’s members, owners, assignees, affiliates, and subscribers.”). However, a statutory
regarding the assessment of fees against Martin’s commissions,” which relate to its veilpiercing conclusion.
16
exception allows the corporate veil to be pierced “if the obligee demonstrates that the . . . owner
. . . caused the corporation to be used for the purpose of perpetrating and did perpetrate an actual
fraud on the obligee primarily for the direct personal benefit of the . . . owner . . . .” Tex. Bus.
Orgs. Code § 21.223(b). Here, the trial court appeared to find that the corporate veil had been
pierced under an alter-ego theory. See Dodd, 426 S.W.3d at 290 (citing Castleberry v. Branscum,
721 S.W.2d 270, 272 (Tex. 1986)); Plan B Holdings, 681 S.W.3d at 461. To prevail on an alterego theory of veil piercing, “the plaintiff must demonstrate (1) that the entity on which it seeks to
impose liability is the alter ego of the debtor, and (2) that the corporate fiction was used for an
illegitimate purpose, that is, to perpetrate an actual fraud on the plaintiff for the defendant’s direct
personal benefit.” Plan B Holdings, 681 S.W.3d at 461 (quoting U.S. KingKing, LLC v. Precision
Energy Servs., Inc., 555 S.W.3d 200, 213–14 (Tex. App.—Houston [1st Dist.] 2018, no pet.)).
Texas follows a “fair notice” standard for pleading, which considers whether an
opposing party can ascertain from the pleading the nature and basic issues of the controversy and
what testimony will be relevant. Horizon/CMS Healthcare Corp. v. Auld, 34 S.W.3d 887, 896
(Tex. 2000). Issues, including alter ego, that are not raised by the pleadings may be tried by the
express or implied consent of the parties. See Tex. R. Civ. P. 67; Richard Nugent & CAO, Inc.
v. Estate of Ellickson, 543 S.W.3d 243, 264 (Tex. App.—Houston [14th Dist.] 2018, no pet.)
(“Alter ego must be specifically pleaded or it is waived, unless tried by consent.”). Trial by consent
applies in “exceptional cases” where it appears from the record that an issue was actually tried,
although not pleaded. Armstrong v. Armstrong, 570 S.W.3d 783, 789 (Tex. App.—El Paso 2018,
pet. denied).
It is undisputed that Martin did not plead veil piercing, but Martin argues that the
parties impliedly tried the issue by consent. He points to evidence admitted regarding “Dallas
17
operating as CEO,” Dallas’s “personal involvement in disputed transactions,” Dallas’s “arbitrary
conduct in acting on behalf of [the Seely Group],” and Dallas’s “representations that he could
assess fees however he wanted” because he was “the boss and owner.”
On this record, we cannot conclude that this is an “exceptional case” in which the
parties tried the issue of veil piercing by consent. While the record may include some evidence
potentially relevant to the issue of alter ego, there is no evidence that the issue of an alter-ego
theory of veil piercing was tried. See id.; Johnston v. McKinney Am., Inc., 9 S.W.3d 271, 281
(Tex. App.—Houston [14th Dist.] 1999, pet. denied). Further, even if the parties had tried the
issue by consent, there is no evidence in the record that Dallas used the Seely Group to perpetrate
an actual fraud for his direct personal benefit. 6 Evidence at trial showed that Dallas was the CEO
of the Seely Group, and as part of that role, he developed the Contract, which he and his executive
team rolled out to agents, and was involved in decisions regarding commissions and payouts both
under and outside of the Contract. But no evidence, including the evidence that Martin points to
in his appellate brief, raises a reasonable inference to support the finding that Dallas received a
“direct personal benefit” from the purported actual fraud that Martin alleges occurred. See Tex.
Bus. Orgs. Code § 21.223(b); Shook v. Walden, 368 S.W.3d 604, 622 (Tex. App.—Austin 2012,
pet. denied). In cases in which the “direct personal benefit” showing has been met, evidence
showed that funds derived from the corporation’s allegedly fraudulent conduct were diverted to
the individual defendant. See Hong v. Havey, 551 S.W.3d 875, 885–886 (Tex. App.—Houston
[14th Dist.] 2018, no pet.) (collecting cases). There was no such evidence of a direct personal
6 In their request for findings of fact and conclusions of law, appellants specifically requested that the trial court explain: “How Dallas (a non-party to the [Contract]) . . . is liable for breach of an agreement to which he is not a party[.]”
18
benefit to Dallas resulting from actual fraud in connection to the “material misrepresentations”
that Martin alleges Dallas made “regarding the assessment of fees against Martin’s commissions,”
as the trial court found. See id.; Tex. Bus. Orgs. Code § 21.223(b); cf. Hurwitz v. SynergyMed
Corp. Wellness, LLC, No. 03-24-00673-CV, 2025 WL 3165386, at *8–9 (Tex. App.—Austin
Nov. 13, 2025, no pet. h.) (mem. op.) (finding sufficient evidence of appellants’ “direct personal
benefit” when record contained evidence that individual defendant used corporation “as his
‘personal piggy bank,’” including making down payment on real property for his personal benefit).
Because the record does not indicate that corporate veil piercing was pled or tried
by consent, and because no evidence supports the trial court’s findings piercing the Seely Group’s
corporate veil by an alter-ego theory, we agree with appellants that Dallas cannot be held
personally liable for the Seely Group’s breach of the Contract, to which he is not a party. We
sustain appellants’ third issue.
Appellants’ claims
Breach of contract
In their eighth issue, appellants argue that the trial court erred by rendering a takenothing judgment against the Seely Group. Specifically, appellants contend that they proved that
Martin breached “both the [Contract] and the loan agreement,” pointing to Martin’s failure to pay
the $7,500 post-separation training fee and the existing loan balance.
As to the loan balance, appellants argue that Martin breached “the loan agreement”
when he did not repay “the loan balance.” While undisputed evidence at trial established that the
Seely Group advanced $8,708.25 to Martin, appellants did not allege in their pleadings or attempt
to establish at trial the existence of a “loan agreement” separate from the Contract, nor did
19
appellants allege that the Contract itself served as the basis for Martin’s obligation to repay the
advance. See Fort Worth Indep. Sch. Dist. v. City of Fort Worth, 22 S.W.3d 831, 846 (Tex. 2000);
Sharifi v. Steen Auto., LLC, 370 S.W.3d 126, 142 (Tex. App.—Dallas 2012, no pet.). Evidence at
trial did not conclusively establish as a matter of law all vital facts in support of the Seely Group’s
breach-of-contract claim on the advance. See New York Party Shuttle, 414 S.W.3d at 211. The
Seely Group therefore did not conclusively establish as a matter of law that Martin breached a
contract by failing to repay the amount the Seely Group claims that it is still owed. See id.
As to the post-separation training fee, we determined above that sufficient evidence
in the record supports an implied finding that the Seely Group breached the Contract by failing to
deliver the specialized training as promised. “In general, ‘[a] fundamental principle of contract
law is that when one party to a contract commits a material breach of that contract, the other party
is discharged or excused from any obligation to perform.’” Stapel, LP v. Scott & White Mem’l
Hosp., No. 03-16-00750-CV, 2018 WL 386675, at *7 (Tex. App.—Austin Jan. 3, 2018, pet.
denied) (mem. op.) (quoting Hernandez v. Gulf Grp. Lloyds, 875 S.W.2d 691, 692 (Tex. 1994)).
Thus, the trial court’s judgment against the Seely Group on its breach-of-contract claim can be
upheld on the ground that Martin was not required to pay the post-separation training fee after the
Seely Group’s breach of the Contract and thus the Seely Group improperly withheld commission
it owed Martin to account for this fee.
We overrule appellants’ eighth issue. Because we affirm the trial court’s judgment
on the Seely Group’s breach-of-contract claim, we do not need to reach appellants’ fourth issue,
which challenges the trial court’s conclusion that the prevailing-party attorney’s fees provision in
the Contract is “unconscionable.” See Tex. R. App. P. 47.1.
20
Offset
Appellants contend that the trial court erred in not applying an offset against
Martin’s damages for the Seely Group’s “advance/loan” of $8,708.25. The right to an offset, or a
reimbursement against damages, is an affirmative defense, which must be pleaded and proved by
the party asserting it. See Brown v. American Transfer & Storage Co., 601 S.W.2d 931, 936 (Tex.
1980). The party asserting its entitlement to an offset has the burden of pleading the affirmative
defense and proving the facts necessary to support it. Id.; see Tex. R. Civ. P. 94. But, as with the
unpleaded claim of corporate-veil piercing discussed above, an unpleaded affirmative defense may
be deemed to have been tried by consent when evidence on the issue is developed at trial under
circumstances that indicate that both parties understood that the issue was in the case, and the other
party does not object. Tenet Health Sys. Hosps. Dallas, Inc. v. North Tex. Hosp. Physicians Grp.,
P.A., 438 S.W.3d 190, 204 (Tex. App.—Dallas 2014, no pet.).
Appellants fault the trial court for not granting an offset, but the Seely Group’s
pleadings do not assert it. See Geis v. Colina Del Rio, LP, 362 S.W.3d 100, 113 (Tex. App.—San
Antonio 2011, pet. denied) (“Because this offset was not requested in [appellant’s] pleadings, this
complaint is not preserved for appellate review.”). Appellants attempt to rely on the fact that
Martin’s pleadings asserted the affirmative defense of offset, but that improperly shifts the burden
of responsive pleadings. See Tex. R. Civ. P. 94. Likewise, though the Seely Group points to
evidence at trial of “loan balancing offsetting Martin’s claim for commissions,” this evidence was
also relevant to the pleaded issue of Martin’s offset affirmative defense and thus does not indicate
the parties’ clear intent to try the unpleaded issue of the Seely Group’s offset claim. See Gharbi
v. Hemmasi, No. 03-07-00036-CV, 2015 WL 4746682, at *5 (Tex. App.—Austin Aug. 6, 2015,
no pet.) (mem. op.) (citing Case Corp. v. Hi-Class Bus. Sys. Of Am., Inc., 184 S.W.3d 760, 771
21
(Tex. App.—Dallas 2005, pet. denied)). We cannot say that this is one of the “exceptional cases”
where it appears from the record that the Seely Group’s offset issue was actually tried, although
not pleaded. See Armstrong, 570 S.W.3d at 789.
We overrule appellants’ sixth issue.
Damages
Finally, appellants contend that there is not legally or factually sufficient evidence
to support the trial court’s award to Martin of $20,714.17 in damages. Appellants argue that,
notwithstanding an offset from the loan and the post-separation training fee, the most that the Seely
Group would owe Martin under the Contract is 40% commission on the 500 E. 5th Street and
Knights Branch Drive properties, less Keller Williams’ broker fees, for a total of $5,261.91
($2,876.83 on 500 E. 5th St. and $2,385.08 on Knights Branch Drive).
The trial court found that the Seely Group wrongfully (1) “assess[ed]” $2,904.23
worth of transaction fees and $1,994.00 in administrative fees against Martin’s commissions;
(2) “with[eld]” $7,110.69 of Martin’s commissions; and (3) “collect[ed]” commissions “totaling
$8,705.25[ 7] from the 500 E. 5th St. transaction.” Appellants suggest that the trial court appeared
to reach the total damages sum by adding these amounts, which it pulled from the disbursement
authorization forms for the 500 E. 5th Street commercial lease and the Knights Branch Drive
residential sale, as well as the spreadsheet that Dallas attached in his email to Martin proposing his
repayment of the loan that led to the parties’ dispute.
7 This figure appears to include a typo, as this amount is otherwise consistently referred to as $8,708.25.
22
The first category—$2,904.23 in transaction fees and $1,994.00 in administrative
fees (totaling $4,898.23) “assess[ed]” against Martin’s commissions—appears to refer to the total
proposed transaction and administrative fees noted in Dallas’s spreadsheet emailed to Martin
discussing his proposal for how Martin would repay the loan. However, it is undisputed that this
spreadsheet did not represent the Seely Group’s official accounting of Martin’s commissions;
instead, it was Dallas’s estimate of how he proposed Martin would repay the loan through
deductions from his commissions on the 500 E. 5th Street and Knights Branch Drive properties.
That is, the spreadsheet restated amounts pulled from the disbursement authorization forms for
both properties and did not represent additional sums that had been deducted from money owed to
Martin. And the damages calculations for the 500 E. 5th Street and Knights Branch Drive
properties are already accounted for in the trial court’s damages award (discussed below). Adding
these amounts to Martin’s damages calculation provided for duplicate recovery of $4,898.23 in
transaction and administrative fees that is not substantiated by any evidence.
The second category—$7,110.69 “with[eld]” from Martin’s commissions—
appears to refer to the Knights Branch Drive property, as there is no evidence of any other
transaction for which Martin is owed a commission (besides 500 E. 5th St., discussed below). It is
undisputed that Martin never received any commission from the Knights Branch Drive sale. But
it is also unclear from the record where the $7,110.69 figure comes from, as no exhibits or
testimony at trial reflect or total that amount, nor have appellants or Martin pointed to any support
in the record for that amount. Thus, we review the record to determine whether some of this
amount is supported by sufficient evidence.
The disbursement authorization form for Knights Branch Drive indicates that the
gross commission income—which, as Martin testified, is the amount from which the 60/40
23
commission split is calculated—is $8,057.70. Forty percent of that amount, or Martin’s
commission determined by the Contract, is $3,223.08. The Keller Williams brokerage fee, which
the Contract states is to be subtracted from Martin’s commission, is $838. Martin’s commission
minus the brokerage fee is $2,385.08. And the trial court found that the Seely Group “improperly
deducted” transaction and administrative fees from Martin’s commission, so no transaction fee or
$997 administrative fee would be further deducted. This amount of $2,385.08 is supported by
testimony by Dallas and Martin, as well as the disbursement authorization form for the property
admitted as an exhibit at trial. And the Seely Group agrees that $2,385.08 is “the most”
commission that Martin could have received for the Knights Branch Drive property. Thus, while
the $7,110.69 figure is not supported by the record, the trial court’s damages finding is partially
supported by legally sufficient evidence of $2,385.08 that the Seely Group withheld from Martin’s
commissions. This finding also is not so contrary to the evidence as to be clearly wrong and unjust,
so it is partially supported by factually sufficient evidence.
Finally, the third category—$8,708.25 in “collect[ed]” commissions—refers to the
500 E. 5th St. transaction. The trial court concluded that the Seely Group was not entitled to a 60%
commission or any of its fees because that property was not covered by the Contract. The trial
court also concluded that “the funds issued to Martin were an advance for commission from the
sale [sic] of 500 East 5th Street which has been accounted for in the Judgment.” The disbursement
authorization form for 500 E. 5th Street indicates that the net commission (i.e., the amount from
the brokerage to the agency from which Martin’s commission would be calculated), minus the
Keller Williams brokerage fee, is $8,708.25, or the total amount that the Seely Group advanced to
Martin. Thus, while sufficient evidence supports the trial court’s determination that the 500 E. 5th
Street property was not covered by the Contract and therefore the Seely Group was not entitled to
24
any commission or fees from that deal (i.e., that it “wrongfully collect[ed] commissions” on this
property), there is no evidence that supports an additional award of $8,708.25 in damages from the
500 E. 5th Street property to Martin. In other words, because Martin already received the full
amount of commission that he was entitled to for 500 E. 5th St. when he received the advance, he
is not entitled to a double recovery of that amount in the judgment.
In sum, “although the evidence is legally sufficient to support a finding of some
amount, it is legally insufficient to support the entire amount” the trial court awarded. Akin, Gump,
Strauss, Hauer & Feld, L.L.P. v. National Dev. & Rsch. Corp., 299 S.W.3d 106, 123 (Tex. 2009).
“[W]hen there is some evidence of damages, but not enough to support the full amount, it is
inappropriate to render judgment.” Id. at 124. “In such a case, ‘we may either suggest a remittitur
or remand to the trial court for a new trial.’” Kazmi v. Kazmi, 693 S.W.3d 556, 581 (Tex. App.—
Austin 2023, pet. denied) (quoting DeNucci v. Matthews, 463 S.W.3d 200, 215 (Tex. App.—
Austin 2015, no pet.)). Accordingly, we suggest a remittitur of $18,329.09, the difference between
the amount awarded, $20,714.17, and the amount supported by sufficient evidence, $2,385.08. See
Tex. R. App. P. 46.3 (providing that “court of appeals may suggest a remittitur”). We reform this
portion of the trial court’s judgment conditioned on Martin filing this remittitur within 30 days of
the date of this opinion. See id. (“If the remittitur is timely filed, the court must reform and affirm
the trial court’s judgment in accordance with the remittitur. If the remittitur is not timely filed, the
court must reverse the trial court’s judgment.”). 8
8 Otherwise, we will reverse this portion of the judgment and remand the cause to the trial court for a new trial. See Tex. R. App. P. 46.3 (“If the remittitur is not timely filed, the court must reverse the trial court's judgment.”). Because an appellate court “may not order a separate trial solely on unliquidated damages if liability is contested,” id. R. 44.1(b), and because the Seely Group has contested liability, remand of the issues of liability and the unliquidated damages will be necessary, see Minnesota Min. & Mfg. Co. v. Nishika Ltd., 953 S.W.2d 733, 740 (Tex. 1997).
25
We sustain appellants’ seventh issue.
CONCLUSION
We reverse the trial court’s judgment to the extent that it holds Dallas personally
liable. We reform the trial court’s judgment to reflect an award of $2,385.08 in damages, and as
reformed, we otherwise affirm the judgment conditioned on Martin filing the remittitur within
30 days of the date of this opinion.
Rosa Lopez Theofanis, Justice
Before Justices Triana, Kelly, and Theofanis
Reversed and Rendered in Part; Reformed and, as Reformed, Affirmed in Part
Filed: July 10, 2026
E.g., Golden Corral Corp. v. Noble Austin Apartments L.L.C., No. 03-19-00463-CV, 2021 WL 2878565, at *11 n.15 (Tex. App.—Austin July 9, 2021, no pet.) (mem. op.).
26