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Mowdy's Arbitration Defense and Counter Claim

Arbitration Case:  70 527 E 00416 12

 

 

JOHN HUGHES d/b/a hughes amalgamated

claimant

 

V.

 

THOMAS C. MOWDY

RESPONDENT

 

 

 

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American arbitration association

 

 

respondent MOWDY'S 3rd amended counterclaim

 

 

Respondent, Thomas C. Mowdy, files this 2nd amended counterclaim against Claimant John Hughes d/b/a Hughes Amalgamated. 

 

 

 

A. Parties

 

1.  Respondent:  Thomas C. Mowdy, hereinafter "Mowdy", is an individual residing in Williamson County, Texas, at 1805 Carey Avenue, Taylor, TX 76574.

 

 

2.  Claimant:  John Hughes d/b/a Hughes Amalgamated, hereinafter "Hughes", is a general contractor who resided in Williamson County, when he filed this matter for litigation, and who is now believed to live in Indianapolis, Indiana.

 

3.  Additional parties may be determined during discovery.

 

 

B. Introduction and Overview

 

4.  .  Claimant John Hughes's, d/b/a Hughes Amalgamated, planned and executed a scheme to force unearned money payments from Mowdy by oppressing Mowdy with a fraudulent lien and devastating fraudulent lawsuit to foreclose on Mowdy's home.  And, by his own admission, Hughes has done something like this more than 24 times in the past, Exhibit "166.   Hughes has continuously refused, in court and arbitration, to provide TRCP 194.2(d) disclosure, which requires Hughes to reveal his "method of calculating economic damages," because he has no economic damages.  It is apparent that Hughes thought, and continues to think, he had an easy senior citizen target, with valuable assets, for the fraud scheme.   Mowdy did not breach the contract with Hughes, and Hughes was overpaid.  Hughes's scheme did not go as Hughes planned.   Hughes did not expect Mowdy could produce a copy of the missing written contract Hughes concealed.  Hughes did not expect that Mowdy would have the will, ability, and tenacity to confront and prove Hughes's fraud and criminal activity.  But, the financial, and emotional cost has been a heavy, irreparable, and unwarranted burden Hughes planned and maliciously forced on Mowdy, his wife Joanna, and their family.

 

5.  On August 18, 2009, Mowdy contracted with Hughes for repair of the lighting caused fire damaged house, a homestead.  Hughes promised, in writing, to perform the repairs for the lesser of his actual cost plus 10% overhead and 10% profit, or the maximum amount allowed by the insurance carrier, Exhibit "3", paragraph 2, and CONTRACTOR'S FEE, paragraph 4. 

 

6.  Hughes's actual costs were $183,191.42, Exhibit "184", "179", "180", "181", and Mowdy owed Hughes the $183,191.42 plus 10% overhead and 10% profit.   Mowdy owed Hughes a total of $219,829.70, Exhibit "184".  Because of Hughes's deceptive acts, Hughes was paid $312,890.61, at least a  $93,060.91 overpayment, Exhibit "183", as shown by Exhibit "14", cancelled checks.

 

7.  In violation of the contract's paragraph 2, limiting his compensation to the maximum allowed by the insurance carrier, $377,018.40, Exhibit "2", Hughes charged Mowdy a fraudulent $454,431.83, Exhibit "45", demanding a 132.98% profit of $243,613.30 on his $183,191.42 costs and expenses, Exhibit "185".   In violation of the contract's paragraph 4, Hughes charged Mowdy more than Hughes's actual cost plus 10% overhead and 10% profit, Exhibits "182, 183, and 12".  Hughes's included excessive and fraudulent charges in violation of the contract terms, duplicate charges, and charges for work never performed and materials never provided, Exhibits "151", "2", "12", "13", "17", "179", 180", "181", "303", deposition page 72, lines 15 - 21, (one corroborating example of many in exhibit 151)" .  

 

8.  The insurance company, USAA, and Mowdy, refused to pay Hughes's demands and identified Hughes's fraudulent charges before Hughes filed his fraudulent lien claim and lawsuit, Exhibit "2".  Hughes was informed, with specific detail, by USAA, and Mowdy, and all Hughes's fraudulent claims and filings were deliberately and knowingly made and sustained, over an extended period of time in official proceedings.  Hughes's deliberate and sustained fraudulent actions were in violation of Texas penal codes and deceptive trade, and fraud laws, and have caused Mowdy, and his family extreme life disrupting stress and mental anguish since August 2010, Exhibit "147".

 

 

C. The Fraudulent Contract

 

9.  Hughes concealed the true and correct contract from his lien claim and lawsuit and filed fraudulent documents, in official proceedings,  to support his fraudulent claims.  On August 18, 2009, Hughes and Mowdy agreed, by written contract, Exhibit "3", to terms that Hughes would repair Mowdy's fire damaged homestead for Hughes's actual cost plus 10% overhead and 10% profit with a maximum charge no greater than the amount allowed by the insurance carrier, paragraph 2, and 4, Exhibit "3".  There are no other places in the contract that describe compensation terms except paragraphs 2, and 4.  There is no place in the contract that indicates or states any payment, except the maximum allowed by the insurance carrier, will be based on any estimate.  The two page contract, is the true and correct contract, as sworn by Hughes's Exhibit "3" affidavit.  But, that is not the document Hughes filed and swore was the contract in his lien claim and lawsuit, Exhibits "1", '173", "3".  His sworn statements are in conflict.  The 119 page document Hughes swore, on November 12, 2010, was the contract and filed with the Williamson County and District Clerks, Exhibit "1", and "173", was fraudulent and contained fraudulent claims.   Hughes's Exhibit "1", November 12, 2010, affidavit was proven false by his sworn Exhibit "3", affidavit .  Each of Hughes's affidavits claims a different document is the contract, and both cannot be true.  Hughes committed perjury and aggravated perjury by making false statements and filing those statements and a fraudulent document in official proceedings.

10.  During the house repair period, Hughes had access to Mowdy's, temporary apartment, Exhibit "76", and Mowdy's copy of the contract became missing from the apartment, Exhibit "80".  (See Section VI of the brief attached to the Exhibit "80" email.)  After Hughes filed his lien claim, Mowdy sought legal advice, giving extensive information to a lawyer in attachments to an email.  Then, the lawyer Mowdy consulted, Ted Hejl, determined he had a conflict of interest after inviting the consultation, Exhibit "146", and "80".   Mr. Hejl apparently forgot his small law office had previously represented Hughes, who was a 30 year resident of Taylor, and who also performed contract work for the city of Taylor.  Mr. Hejl is also the Taylor City Attorney.  

11.  There is sufficient reason to believe Hughes received information after filing his lien claim that convinced Hughes that Mowdy's copy of the signed Exhibit "3" contract was not in Mowdy's possession.  Hughes filed a lien claim and lawsuit using his fraudulent contract, Exhibits "1", "173", and "3".  Hughes's lien claim and lawsuit actions clearly indicate Hughes somehow believed Mowdy could not counter Hughes's claims with the true and correct August, 18, 2009, contract.  Mr. Hejl, the lawyer Mowdy consulted, does some work for City National Bank, which is across the street from Hejl's law office.   A bank, which is owned by the father of the wife of Hughes's brother, who is Louis Hughes.  Louis Hughes operates an investment business in conjunction with City National Bank.   Mr. Hejl, the Taylor City Attorney, knows the former Taylor Acting Police Chief, Dan Ramsey, who refused to accept Mr. Mowdy's criminal complaint on the missing contract and fraudulent document, on more than one occasion, Exhibit "65".   These relationships could have, even inadvertently, communicated the information to Hughes that Mowdy lost his contract.  Such information would provide Hughes confirmation that Mowdy did not have a copy of the contract, and thereby give Hughes confidence to make fraudulent claims and file a lien claim and a lawsuit, with a fraudulent document.   

 

12.  First, Mowdy's contract becomes missing from a place where Hughes had full access.  Then Hughes files a lien claim without the true and correct contract, Exhibit "1".  Mowdy consults with a lawyer who invited the consultation, Exhibit "80", and who has previously represented Hughes and had a conflict of interest.  Hughes refused to produce the true and correct contract after three certified requests, Exhibit "40", "41", "58", and refused an audit based on the contract terms, Exhibit "12".   Hughes claimed the contract was for "the total amount of the estimates", Exhibit "46", "70, midpage". Terms that cannot be found anywhere in the true and correct contract, Exhibit "3".     Hughes claimed that total "estimate" amount is "$454,431.83", Exhibit "45".  On October 5, 2011, Hughes filed a breach of contract lawsuit, without the true and correct written contract, citing no specific contract violations and presented a "Quantum Meruit" legal argument, Exhibit "173".  Quantum Meruit is a legal cause of action that applies only when there is no written contract.  Then, in a telephone conversation with Mowdy, Hughes's lawsuit attorney, Mr. Loree, inadvertently confirmed he was in possession of the true and correct written contract, Exhibit "61".   Hughes then avoided all discovery, Exhibit "129", and later resisted producing his actual costs until production was ordered by the Arbitrator's November 12, 2012, Order on Pending Motions.  In the lawsuit, Hughes was confronted with the true and correct contract, a No Evidence Summary Judgment, Exhibit "131 ", and a Counterclaim, Exhibit "86", Hughes then produced the true and correct contract in District Court, but, only to demand arbitration, at the last moment.  Federal law mandates arbitration, if an arbitration clause exists.  These coincidences, the sequence and timing of events, Hughes's false and duplicate charges, and Hughes's desire to ignore the terms of the contract, all warrant consideration.

 

13.  Apparently, believing Mowdy permanently lost his contract, Hughes filed a lien claim and then a lawsuit in the 277th District Court, Case # 11-1064-277, Exhibit "139", with a fraudulent unsigned document he swore was the contract, Exhibit "1".  Mowdy responded denying all Hughes's claims, Exhibit "50",  and presented the true and correct contract to Hughes, Exhibit "61".  After learning that Mowdy had a copy of the true and correct contract, Hughes then refused to respond to all Mowdy's requests for disclosure, discovery and deposition, Exhibits "7", "129", and made no proper requests for any discovery.  Mowdy made extensive voluntary disclosure and production through answer, motions, and counterclaim filed and sent to Hughes.  Mowdy filed a counterclaim, Exhibit "134", and a No Evidence Summary Judgment, Exhibit "131".   Mowdy then scheduled court hearings for Judicial Review of a Fraudulent Document, Exhibit "77", Invalid Lien Removal, Exhibit "75", and to compel Hughes's deposition, Exhibit "121".  Then, with minimum notice, Hughes filed a motion for arbitration, on the basis of the true and correct August 18, 2009, contract he previously concealed, and scheduled  the hearing one day before Mowdy's hearings, Exhibit "87".  Mowdy opposed, but, Federal law mandated this arbitration because the true and correct contract has an arbitration clause.  The court ordered, but, Hughes did not file for arbitration, Exhibit "137".   Mowdy waited 30 days, after the court order, and then filed with AAA for arbitration to move the matter toward conclusion.  Hughes's action, filing the fraudulent estimate as the contract, have forced him to present and defend the absurd notion that the true and correct contract agreement contained a promise by Mowdy to pay Hughes anything Hughes estimated, at any time, regardless of the work performed or material provided.

 

 

D. Facts

 

14.  On June 30, 2009, Mowdy's home, at 1805 Carey Avenue, Taylor, TX., was struck by lightning, which caused a fire, and required repair.  Mowdy was the original builder of the home in 2008, but, for personal reasons, Mowdy elected not to repair the home himself.

 

15.  The USAA estimate dated July 22, 2010, Exhibit "73", is USAA's estimate of the structure losses Mowdy sustained as a result of the June 30, 2009, lightning strike.  Neither USAA or Mowdy intended or authorized the estimate to be used for any other purpose except to estimate Mowdy's financial loss and list work needed to repair the house.  The final estimate did not exist prior to July 22, 2010.  Hughes used the USAA estimate, dated 7/22/2010, as part of his bill, contract, and invoices to Mowdy, Exhibit "55", "63".

 

 

 

16.  On August 18, 2009, Mowdy, and Hughes entered into a two page written contract agreement for Hughes to make repairs to Mowdy's fire damaged house.  The August 18, 2009, agreement is in Exhibit "3", attached to Hughes's sworn affidavit that identifies the two page document as the contract.

 

17.  Mowdy agrees with Hughes's sworn Exhibit "3" affidavit, that the two page August 18, 2009, Exhibit "3" document is the complete contract.

 

 

18.  Mrs. Joanna Cobb observed the contract negotiations and discussions between Mowdy and Hughes, and the signing of the contract, Exhibit "5".  In deposition, Hughes agreed that Joanna Cobb was present, Exhibit " 303, page 51, line 7".

 

19.  Mrs. Cobb swore, by affidavit,  on October 24, 2011, Exhibit "5",  that no documents other than the two page contract were included in the contract.  There were no attachments or estimates presented or discussed as part of the contract.  She further attested that Hughes particularly discussed and agreed to the terms as stated in paragraph 4 of the contract.  That all charges would be presented and finalized as paragraph 4 supplements for signature at the completion of work for final payment reconciliation under the paragraph 4 contract terms specifying "actual cost plus 10% overhead and 10% profit." Her affidavit statements, are fully consistent with the terms of the written contract agreement, and the contract's paragraph 4 representations made by Hughes in all documents presented to Mowdy for payment, and all lien claim and lawsuit documents filed by Hughes, Exhibits "1, 3, 173, 55, 45".  All these documents show a calculation that includes 10% overhead and 10% profit.  

 

20.  No "contractor's estimate" existed when the Exhibit "3" contract was signed. Hughes admitted, in deposition, Exhibit "303", page 8, line 23, that no contractor's estimate existed at the time the contract was signed.

 

21.  Hughes stated in response to interrogatory that the August 18, 2009, contract was a "fixed cost" contract, Exhibit "156", answer to question 5:  "The terms of the contract were "turn key" and a fixed cost contract with payment based on the scope of work.  The only work performed under contract that allowed for cost plus was the chimney work identified in Claimant's [Hughes's] supplemental estimate."

 

22.  Hughes contradicted his interrogatory response, paragraph 21 above, in deposition by stating that his charges were based on "third-party pricing", Exhibit "303, page 39, line 6, through Page 40, line 24".

 

23.  The August 18, 2009 contract, Exhibit "3", does not contain any language or presentation of "third-party" pricing.  In deposition, Hughes could not identify any contractual mention of "third-party" pricing to Mowdy, Exhibit "303", page 40, line 22, through page 41, line 15.

 

24.  Paragraph 2.) of the August 18, 2009, contract, Exhibit "3", states:  "In the event OWNER's insurance carrier fails to allow an amount sufficient to perform the work according to CONTRACTOR's estimate, CONTRACTOR has the option of modifying the scope of work to match that of the insurance carrier, performing the work for the amount allowed by the insurance carrier, or invoking the termination clause."

 

25.  Hughes did not terminate the August 18, 2009, Exhibit "3", contract.

 

26.  Supplements, to the Exhibit "3" contract, must be approved and signed by both parties and based on actual cost plus 10% overhead and 10% profit.  Paragraph 4.) of the August 18, 2009, contract, Exhibit "3", states:  "It is agreed all supplements will be by written addendum and will be based on actual cost plus 10% overhead and 10% profit." 

 

27.  Hughes's estimates, invoices, andr billing, documents, filed with his November 12, 2010, lien claim and October 5, 2011, lawsuit, are self identified as "supplements," Exhibit "1".

 

28.  There are no signatures on the supplements Hughes filed with his lien claim and lawsuit, and there are no approved supplements to the contract, Exhibit "3".

 

29.  There is no written contract filed with Hughes's November 12, 2010, lien claim, or October 5, 2011, lawsuit, Exhibit "1", and "173".

 

30.  Hughes did not file the Exhibit "3", August 18, 2009, true and correct contract with the November 12, 2010, lien claim, Exhibit "1", or October 5, 2011, lawsuit, Exhibit "173".

 

31.  Hughes's lien claim on Mowdy's homestead was filed on November 12, 2010, Exhibit "1".

 

32.  Hughes filed suit against Mowdy on October 5, 2011, to foreclose on Mowdy's homestead, and Hughes attorney, Robert W. Loree, swore and verified the documents filed to be true and correct, Exhibit "173", and "85".

 

33.  Hughes's affidavit dated November 12, 2010, Exhibit "1", which Hughes filed with his November 12, 2010, lien claim and October 5, 2011, lawsuit, is false and fraudulent because it identified the 119 pages attached to the affidavit as the contract for the work performed on Mowdy's homestead, and claimed more than $100,000 in itemized labor and materials were provided when they had not been provided, Exhibit "151".  The false and fraudulent affidavit was filed, by Hughes, in two official proceedings, first with the Williamson County Clerk for a lien claim, Exhibit "1", and second with the Williamson County District Clerk for a lawsuit, Exhibit "173".

 

34.  Hughes acknowledged the existence of the true and correct contract, Exhibit "3", by citing the specific handwritten terms requiring subcontractor release of liens, shown on page 2 of the contract, in an email on September 15, 2010, only two months prior to filing his lien claim with a fraudulent contract, Exhibit "37".  Proving, Hughes knew the Exhibit "1", 119 page document was not the true and correct contract, and knew it contained claims that were false, and the document was therefore fraudulent.  Hughes knew the Exhibit "1" document was fraudulent.  The court ordered arbitration and if Hughes presents the Exhibit "1" document in arbitration, as a contract, or part of a contract, it will be an additional presentation of the fraudulent document in an official proceeding, by Hughes.

 

35.  Hughes did not respond to Mowdy's three certified requests, made to Hughes, after Hughes filed the November 12, 2010, lien claim, Exhibits "58", "24", and "25".   Mowdy made each request under Texas Property Code 53.085, and 53.159, for Hughes to provide Mowdy with a copy of the August 18, 2009, contract.  Proving, Hughes knew his lien and lawsuit claims were fraudulent and proving Hughes was concealing the true and correct contract.

 

36.  Hughes filed the true and correct Exhibit "3" contract with the Williamson County Clerk only after Mowdy notified Hughes's lawyer, on October 31, 2011, Exhibit "6", and on November 2, 2011, that Mowdy had a copy of the true and correct contract, Exhibit "61".  

  

37.  The County Clerk's date stamp, November 22, 2011, on Exhibit "3", shows when the document was filed, yet the year date on Hughes's affidavit is missing.  Mowdy asked the notary, Margaret Ann Haisler, to confirm the date the document was notarized.  Ms. Haisler confirmed the document was signed by Hughes and notarized on November 16, 2011, by her, Exhibit "10", hand written notation above her notary stamp on the document.  November 16, 2011, is a date after Hughes filed his October 5, 2011, lawsuit and after Mowdy notified Hughes's lawyer that Mowdy had a copy of the true and correct contract, Exhibit "61".  Hughes concealed the true and correct contract until he knew Mowdy had a copy.

 

38.  Hughes did not file the true and correct contract with the Williamson County Clerk until November 22, 2011, more than one year after his November 12, 2010, lien claim.

 

 

39.  The amount allowed by the insurance carrier, for the repair of Mowdy's house structure is $377,018.40, Exhibit "2".

 

40. Hughes agreed, by his signature on the written agreement, to terms that repairs would be made for the lesser amount of Hughes's actual cost plus 10% overhead and 10% profit, paragraph 4, Exhibit "3", or the amount the insurance carrier allowed for the repairs, paragraph 2, Exhibit "3".  Therefore, the maximum Hughes could charge, under the contract terms, was the $377,018.40 allowed by the insurance carrier, Exhibit "2", and "9".

 

41.  The amount allowed by the insurance carrier was more than the amount necessary to accomplish repairs made to Mowdy's homestead by Hughes, Exhibits "2,  9, 151, 179, 180, 181, 182, 185", and then provide more than a reasonable and fair gain to Hughes. 

 

 

42.  Paragraph 2, of the August 18, 2009, Exhibit "3", contract, specifically states that: "CONTRACTOR's Estimate is the itemized list of the work to be performed pursuant to this agreement."  The contract terms gave no purpose for a "contractor's estimate," other than a list of the "work" to be performed.

 

43.  Hughes's presentations of billing documents to Mowdy included calculations of 10% overhead and 10% profit, Exhibits "29", "30", "45", "47", and "138", consistent with the terms of paragraph 4.) CONTRACTOR's FEE, August 18, 2009, contract, Exhibit "3".

 

44.  The contract, Exhibit "3",  was provided by Hughes.  Paragraph 4, of the true and correct contract, Exhibit "3", is presented as: "CONTRACTOR'S FEE", in large bold letters, with an apparent intent to communicate that the terms following those words were the terms for the fee to be paid to the contractor.  No other paragraph in the contract makes any such emphasized, or comparable, communication or expression concerning the amount Mowdy would be expected to pay the contractor.

 

45.  Mowdy discovered Hughes was making fraudulent billing charges when some subcontractors Hughes failed to pay, including one represented by an attorney, asked Mowdy for payment, Exhibits "12", "14", and "72".

 

46.  The contract required Hughes to provide release of liens for subcontractors, but, Hughes never provided Mowdy with a lien release from any subcontractor, Exhibit "3" (See Hughes's handwritten note on page two of the signed contract.)

 

47.  Mowdy paid subcontractors that Hughes refused to pay for work on Mowdy's homestead, Exhibits "14", "72", and "197".

 

48.  Hughes refused Mowdy's January 19, 2011, request for an audit based on written terms of the contract, Exhibit "12", and "46".

 

49.  Mowdy paid Hughes $312,890.61, Exhibit "14".

 

50.  Hughes's total cost and expenses, including $5,738.58 identified as overhead, for repairing Mowdy's homestead were approximately $188,930.00, Exhibits "179, 180, 181, 182, 183". 

 

51.  Hughes's cost and expenses, excluding $5,738.58 identified as overhead, for repairing Mowdy's homestead were approximately $183,191.42, Exhibit 183.

 

52.  Under the terms of the contract, paragraph 4, Exhibit "3", Hughes was due $219,829.70, Exhibit "184".

 

53.  Hughes was paid $312,890.61, and gained $129,699.19, which is a 70.80% gain on costs and expenses, Exhibit "183".

 

54.  Hughes documented he expected to make a $75,548.12, gain on the contract, Exhibit "45".

 

55.  Hughes profited $129,699.19, which is $54,151.07 more than the $75,548.12 Hughes expected:  ($129,699.19 - $75,548.12 = $54,151.07 more than expected).  Exhibits "183, 45, 3".

 

56.  Hughes demanded to be paid an unreasonable $426,804.72  giving Hughes $243,613.30 profit which is a 132.98% profit margin above his expenses, Exhibit "185". 

 

57.  Hughes claimed the contract terms were for the "estimate," but provided no specific written contract term reference for that claim, Exhibit "46", and refused to provide an intelligible, rational, response through interrogatory when questioned on the issue,  Exhibit "156", question 6. 

 

58. Hughes filed a Quantum Meruit Cause of Action against Mowdy, Exhibit "173".   Quantum Meruit is a Cause of Action only when there is no written contract.  Hughes knew this was a fraudulent act because he knew there was a written contract, Exhibit "3".

 

59.  Hughes presented Mowdy with duplicate claims, and claims for work Hughes did not perform and materials Hughes did not provide, Exhibits "151", "1", "2", "4", "13", "17", "20", "97", all amounting to more than $100,000, Exhibit "301", and "151".

 

60.  Hughes refused Mowdy's request for release of lien claim under the provisions of Texas Penal Code 32.39, Exhibits "56", and "90".

 

61.  Mowdy made multiple offers to Hughes to settle his claims according to the terms of the true and correct contract, Exhibits "12", and "90 ".

 

62.  Mowdy is over the age of 65, born April 25, 1947, a "senior citizen," and lives on fixed income pensions.

 

63.  Hughes was made aware of the stress and mental anguish he was causing Mowdy, Exhibits "91", and "147", and in all motions filed by Mowdy.

 

 64.  Hughes has caused Mowdy stress and mental anguish greater than Mowdy experienced in Vietnam, Exhibit "91", and which will continue into the future, Exhibit "147".   Mowdy is a frontline combat veteran, who was an assault helicopter flight leader in Vietnam and was exposed to significant combat action and stress on a daily basis, Exhibit "65", (Chicago Tribune article and letter attached to County Attorney letter). 

 

65.  Hughes was due his actual cost plus 10% overhead and 10% profit, paragraph 4, Exhibit "3".  Hughes was due $219,829.70, line "e.", Exhibit "183".  Because Hughes made fraudulent  presentations and demands he was paid $312,890.61, line "a.", Exhibit "183", Exhibit "151".  Hughes was overpaid at least $93,060.91, line "f.", Exhibit "183".

 

E. Facts Review

 

66. Hughes presented fraudulent documents demanding and causing Mowdy to make excessive payments in violation of the agreement's written terms. Hughes did not pay some subcontractors for labor and materials they provided to make repairs. Mowdy paid those unpaid subcontractors that requested, but were refused, just and proper payment by Hughes.  Hughes represented that he provided, and then claimed and received payment for, materials that he did not provide and labor that he did not perform.  On November 12, 2010, Hughes filed a fraudulent lien claim against Mowdy's homestead with a false affidavit swearing a 119 page document, Exhibit "1" was the contract for the work performed at Mowdy's homestead.  Mowdy requested an audit to determine the actual amounts due to Hughes under the terms of the agreement. Hughes refused the audit, and on October 5, 2011, Hughes's attorney, Robert W. Loree, filed cause 11-1064-277 in the 277th District Court, Georgetown, TX., and personally swore and verified Hughes's false affidavit, Exhibit "1", "85", "139", and "173", fraudulent contract, and fraudulent lien claim against Mowdy's homestead.  On November 22, 2011, after Hughes's lawyer had been confronted by Mowdy with the fact that the 119 page contract was fraudulent, Hughes filed another affidavit swearing the two page August 18, 2009, Exhibit "3", contract was the true and correct contract.  At that point, Hughes had sworn, in two separate affidavits, that two completely different, and mutually exclusive, documents were each the contract for the work performed at Mowdy's homestead, Exhibits "1", and "3".  The Exhibit "3" affidavit was filed only with the Williamson County Clerk on November 22, 2011, and was not filed within Hughes's 11-1064-277 original cause, October 5, 2011, until Hughes demanded arbitration on May 21, 2012.   Hughes was overpaid and made excessive profit and suffered no harm, Exhibit 183.  Hughes refused to provide a release of lien under the provisions of Texas Penal Code 32.49.  Hughes was made aware of the stress and anguish Hughes was causing Mowdy, Exhibit "91", "147".  Hughes's actions have caused Mowdy extreme stress, life disruption, and mental anguish since August 2010, when Hughes demanded excessive and fraudulent payments.

 

67.  Exhibits "1" through 316 (201-299 excluded)" are submitted with this brief and are referenced herein, or will be referenced in hearings as necessary to prove additional facts.  Additional exhibits may be submitted as discovery progresses.

 

 

F. Count 1 - Cause of Action Breach of Contract Paragraph 4

 

68.  On August 18, 2009, Hughes and Mowdy executed a written contract, the agreement, for repair of fire damage to Mowdy's homestead, Exhibit "3". The agreement provided that Mowdy would pay, and Hughes would charge fees according to Paragraph 4.) CONTRACTOR's FEE, which stated:  "It is agreed all

supplements will be by written addendum and will be based on actual cost plus 10% overhead and 10% profit".

 

69.  Hughes breached the contract by demanding fraudulent payment claiming his costs were based on third party pricing, instead of actual costs, Exhibit "303, pages 39 and 40", failing to advise Mowdy of that fact.  Hughes received payment that was based on fraudulent documents he presented to Mowdy and represented as being in compliance with paragraph 4 of the August 18, 2009, agreement terms, Exhibits  "3", "1", "2", "12", "13", and "17", "151".  Hughes knowingly made false material representations that he would perform the work according to the paragraph 4 terms of the contract, with the intent that Mowdy act on the representation, Exhibit "63", "1", "3", and "173".    When presented for payment, the documents demanding payment appeared consistent with the agreement paragraph 4.) CONTRACTOR's FEE, terms of actual cost plus 10% overhead and 10% profit, Exhibit "29, "30", "45", and "47".  Mowdy relied on the representation and paid Hughes according to the representation.  However, Hughes's billing document presentations of actual costs were fraudulent because they were not Hughes's actual costs, Exhibits "303, pages 39 and 40", "179", "180", "182",  "12", "14", "303, pages 39 and 40", and were for materials and labor he did not provide, Exhibits "1", "4", "17", "126", "97", "13", "151", and therefore Hughes violated the fee terms of the written contract.  Hughes presented inflated and fraudulent actual cost expenses, Exhibit "151", "12", which also caused the 10% overhead and 10% profit calculation to be inflated and fraudulent, Exhibit "45".

 

70.  Hughes breached the contract by fraudulently claiming in presentations of invoices and billings, Exhibits "1", "113", "29", "30", "45", "47", that he provided materials and labor which he did not provide, Exhibits "13", "151", costs that were not actual, and claiming duplicate payment for materials and labor, Exhibits "1", and "2", "151". 

 

71.  Hughes's breach caused injury to Mowdy which resulted in economic damages equal to the "basis of the bargain," which is the amount of money Mowdy paid to Hughes in excess of Hughes's actual cost for materials and labor plus 10% overhead

and 10% profit, Exhibit "183".

 

 

72.  Liquidated Damages.  Mowdy seeks Liquidated damages in the amount paid to Hughes in excess of Hughes's actual costs for material and labor plus 10% overhead and 10% profit.  An amount determined to be $93,060.91, through examination of Hughes's actual cost and expense evidence, Exhibit "183" .

 

73.  Exemplary Damages.  Mowdy's injuries resulted from Hughes's actual fraud and culpable mental state as defined by Texas Penal Code 6.03, which entitles Mowdy to exemplary damages under Texas Civil Practice & Remedies Code (TCP&RC), section 41.003(a), Exhibit "141",  and with malice as defined by TCP&RC 41.001(7), Exhibit "144".  The specific intent, nature, character, degree of culpability, and violation of sense of justice, of Hughes's actions are particularly outrageous and disturbing, against a senior citizen, and should be considered according to TCP&RC Section 4.011.   Mowdy seeks $200,000, in exemplary damages under TCP&RC 41.008(b)(2), as indicated in Mowdy's prayer .

 

 

G. Count 2 - Cause of Action Breach of Contract Paragraph 2

 

74.  On August 18, 2009, Hughes and Mowdy executed a written contract, the agreement, for repair of fire damage to Mowdy's homestead.  Paragraph 2.) WORK DESCRIPTION, of the agreement, provided that in the event Mowdy's "insurance carrier falls to allow an amount sufficient to perform the work according to

CONTRACTOR's estimate, CONTRACTOR has the Option of modifying the scope of

work to match that of the insurance carrier, performing the work for the amount allowed by the insurance carrier, or invoking the termination clause."  Exhibit "3".

 

75.  Hughes breached the contract because he did not invoke the termination clause, but, he charged Mowdy $454,431.83, Exhibit "45", an amount that is $77,413.43 more than the $377,018.40 amount that was allowed by the insurance carrier, Exhibit "2".   An amount that would give Hughes a 105% profit, Exhibit "188".  The excessive charges were made through a fraudulent billing document, Exhibit "55", and "63", presented to Mowdy claiming charges in violation of the agreement terms, and charges for materials not provided and labor not performed, Exhibit "2, 13, 17, 4, 114, 151, 182".  Hughes knowingly made a material and written representation that his charges would not exceed the amount allowed by the insurance carrier with the intent that Mowdy act on the representation.  Mowdy relied on the representation which was false.  Hughes's breach caused injury to Mowdy which resulted in economic and mental anguish damages.

 

 

76. Liquidated Damages.  Mowdy seeks Count 2 liquidated damages as an alternative to Count 1.  Liquidated damages would be the total of the amounts, including just and proper credits and adjustments, Mowdy paid to Hughes, in excess of the amount allowed by the insurance carrier.  Mowdy calculates that amount to be approximately, $27,216.30, Exhibit "14".

 

 

77. Exemplary Damages.  Mowdy's injuries resulted from Hughes's actual fraud and culpable mental state as defined by Texas Penal Code 6.03, which entitles Mowdy to exemplary damages under TCP&RC Section 41.003(a), Exhibit "141",  and with malice as defined by TCP&RC Section 41.001(7), Exhibit "144".  The specific intent, nature, character, degree of culpability, and violation of sense of justice, of Hughes's actions are particularly outrageous and disturbing acts, against a senior citizen, and should be considered according to TCP&RC Section 41.011, Exhibit "142".   Mowdy seeks $200,000, in exemplary damages under TCP&R 41.008(b)(2).

 

 

H. Count 3 - Cause of Action Negligence

 

78.  On August 18, 2009, Hughes and Mowdy executed a written contract, Exhibit "3", the agreement, which established a legal obligation for Hughes to perform construction contractor duties for Mowdy.  In performance of those duties, Hughes had a duty to timely select and install the correct color metal roof for the main roof which matched the existing front porch roof and thereby avoid unnecessary construction delays.

 

79.  Hughes breached his duty because he selected, ordered, received, and began to install the wrong color metal roof.  His negligent act was made although the existing and correct color front porch roof, which was not damaged, was clearly visible on the house and available for comparison and examination.  Hughes negligently selected and ordered the wrong color metal roof and proceeded with installation of that wrong color until Mowdy saw the wrong color roof being installed and ordered the activity stopped. Hughes immediately admitted he selected the wrong color roof and told Mowdy it would take a month, or more, to make the change to the correct color. The partially installed wrong color roof had to be removed and the correct color ordered and installed.  The re-ordering and installation of the correct color roof metal caused an unnecessary and excessive construction delay created by Hughes's negligence which caused injury to Mowdy.  Hughes later claimed the delay was caused by USAA's failure to pay Mowdy, Exhibit "192".  But, as shown by this brief, Hughes was overpaid, Exhibit "182", and had no excuse, other than negligence, for the construction delay.

 

 

80.  Hughes's breach of duty was grossly negligent and was the direct cause of a construction delay.  The construction delay caused by Hughes's negligence forced Mowdy to incur additional and unreimbursed housing, utilities, transportation, and storage expenses because it denied Mowdy use of his house for the additional time required to make the correct roof repair.

 

81.  Mowdy seeks damages for expenses that Hughes negligently caused.  Mowdy seeks $4,408.16, in liquidated damages for rent, utilities, transportation, storage, and temporary storage moving labor, Exhibit "103", "109", "104".

 

I. Count 4- Real Property Damage - Injury to Improvements and Vegetation

 

82.  During construction work at Mowdy's homestead, Hughes caused damage to existing concrete improvements with a mobile crane and damaged seven shrubs, Exhibit "133".

 

83. Hughes's mobile crane damaged the existing concrete improvement by cracking the concrete, Exhibit "33", and a vehicle, under Hughes's control, damaged seven shrubs thereby injuring Mowdy.

 

84. Mowdy seeks liquidated damages of $2,500, to remove and replace the concrete damaged by Hughes's actions. Mowdy also seeks $40.00 per shrub for seven shrubs totaling $280.00 to remove and replace the shrubs.

 

J. Count 5- Common Law Fraud - Fraudulent Bill

 

85.  On August 18, 2009, Hughes and Mowdy executed a written contract, the agreement, for repair of fire damage to Mowdy's homestead.  Hughes made repairs and presented Mowdy with bills that itemized labor Hughes claimed Hughes performed, and materials Hughes claimed Hughes provided to accomplish repairs, Exhibit "63".  But, Hughes made and presented false claims, in excess of $100,000, for labor performed and materials provided, Exhibit "151", "183", to Mowdy.  Hughes actions were fraudulent, knowingly committed, meeting the elements of Common Law Fraud, and caused harm to Mowdy as shown within all this counterclaim.

 

86.  Element 1:  The defendant made a material representation.   Hughes presented invoices over time, and a final bill, all with itemized charges representing that Hughes performed labor and provided materials as charged, Exhibit "63", "304", "192".  Hughes claimed to Mowdy that all charges were valid and necessary, Exhibit "169".  Hughes represented he provided and demanded payment for all itemized charges in his bill, Exhibit "1".

 

87. Element 2: The representation was false.   Hughes did not provide labor and materials as claimed in his Exhibit "63" bill.   Exhibit "151", lists the false, duplicate, and unauthorized claims made by Hughes, within Exhibit "63",  and provides evidence of their false nature in an amount in excess of $100,000.  Exhibits "179, 180, 181, and 182", provide additional proof that, without expenses, Hughes could not have provided all the materials and labor claimed because he had no corresponding expense or record.

 

88.  Element 3: The representation was known to be false when made.   Hughes knew his Exhibit "63" bill contained false claims when presented to Mowdy.   Hughes's claims were previously denied payment by the USAA insurer, Exhibit "2".   Hughes claimed duplicate charges for large items like granite replacement, included charges for labor and materials never provided, like concrete replacement, Exhibits "4", "17", "126", "97", and "151", "303".   Mowdy made offers to jointly verify Hughes's claims through a qualified audit, Exhibit "12".   Mowdy notified Hughes and Hughes's attorney, Exhibits "61", and "6".   Hughes's failure to reasonably react to Mowdy's efforts to resolve the matter, in any manner, indicated Hughes was aware his claims were false.  Hughes admitted in deposition that he did not provide the services and materials claimed, Exhibit "303, page 127, lines 1 - 20".

 

89.  Element 4: Hughes  made the representation with the intent that it be acted upon.   Hughes presented a bill containing a large amount of fraudulent charges to Mowdy for payment, Exhibit "63", "151".   Hughes was overpaid according to the maximum payment terms of the true an correct contract, paragraph 2, Exhibit "3", and "14", "183".  Mowdy, and the insurance company, refused to pay the fraudulent parts of Hughes's bill, Exhibit "2".  Hughes then sued Mowdy which is conclusive proof that when Hughes made his presentation, that Hughes intended Mowdy pay Hughes for his fraudulent claim.    

 

90.  Element 5: Mowdy took action in reliance upon the misrepresentation.

Hughes provided fraudulent representations of Hughes's final bill, Exhibit "63", in invoices and "Schedules of Values" sent to Mowdy for periodic payments, Exhibits, invoices "26", "27", "28", "113", schedules of values, "47", "29", "30", "45".   The amounts charged in the invoices are totaled in Hughes's bill, Exhibit "63".  Mowdy relied on Hughes's representations and took action by making payments to Hughes based on Hughes's representations, Exhibit "14". 

 

91.  Element 6: Mowdy suffered economic and non-economic damage.

Hughes's fraudulent representations and continued fraudulent representation of false claims against Mowdy caused Mowdy economic damages, stress, and mental anguish, Exhibit "150, 182, and 147".

 

92.  Liquidated Damages.  Mowdy seeks liquidated damages in the amount paid to Hughes in excess of Hughes's actual costs for material and labor plus 10% overhead and 10% profit, Exhibit "183".

 

 

93.  Non-Economic Damages.    Mowdy seeks the non-economic damage determination that Hughes's actions were fraudulent, that Hughes presented fraudulent documents with fraudulent claims, with the intent that they have full legal effect, into official proceedings, a lien claim and a lawsuit.

 

94. Exemplary Damages.  Mowdy's injuries resulted from Hughes's actual fraud and culpable mental state as defined by Texas Penal Code 6.03, which entitles Mowdy to exemplary damages under TCP&RC Section 41.003(a), Exhibit "141",  and with malice as defined by TCP&RC Section 41.001(7), Exhibit "144".  The specific intent, nature, character, degree of culpability, and violation of sense of justice, of Hughes's actions are particularly outrageous and disturbing acts, against a senior citizen, and should be considered according to TCP&RC Section 41.011, Exhibit "142".   Mowdy seeks $200,000, in exemplary damages under TCP&R 41.008(b)(2).

 

K. Count 6 - Common Law Fraud - Contract Terms

 

95.   Hughes represented, and the paragraph 4, agreement terms, of Hughes's contract, Exhibit "3", specifically provided, that Mowdy would pay, and Hughes would charge fees according to Paragraph 4.) CONTRACTOR's FEE, which stated:  "It is agreed all supplements will be by written addendum and will be based on actual cost plus 10% overhead and 10% profit."  Hughes further represented, and the agreement terms, paragraph 2, of Hughes's  contract, Exhibit "3",  specifically provided that Hughes's maximum charge would not exceed the amount allowed by Mowdy's insurer.   Hughes made such representations as the only terms of Hughes's compensation in the agreement.  Hughes then later presented charges for fees exceeding all contract amounts and claiming the contract terms of compensation were "fixed price", Exhibit "156", (Hughes's answer to Mowdy's interrogatory number 5).  Hughes also claimed the contract was for the "total amount of Claimant's estimate, which is the basis of the insurance payment to Respondent", in answer 6, Exhibit "156".   Hughes presented Mowdy with charges and demanded payments that were in violation of the compensation terms Hughes presented and agreed in the contract, Exhibit "3".  Hughes presented demands for payment with invoices and billing documents with calculations made to appear consistent with the Exhibit "3", paragraph 4, contract terms, invoice Exhibits "26", "27", "28", "113", and Schedules of Values Exhibits "47", "29", "30", "45"  .   Based on those type representations, Mowdy paid Hughes $312,890.61,  and amount $93,060.91 more than Hughes was due under the terms of the contract, Exhibit "3", "183".  Hughes defrauded Mowdy.  

 

96.    Element 1:  Hughes made material representations.  Hughes made the material representation that his charges would be for actual cost plus 10% profit and 10% overhead with a maximum charge not to exceed the amount allowed by the insurance carrier.

 

97.  Element 2: Hughes material representation was false.

Hughes's representation was false as shown by his billing charges to Mowdy, Exhibit "63", and the detailed analysis of those charges, Exhibit "151".  Hughes then, after presenting demands for payment, stated the terms of the contract were for the "estimate", Exhibit "70", and was a "fixed price" contract, Exhibit "156", and no such terms can be identified in the contract, Exhibit "3".

 

98.  Element 3: Hughes knew his contract representations were false.   Hughes is capable of mental reasoning sufficient to operate a construction business and has extensive experience as a contractor.  Hughes's actions of refusing to comply with Mowdy's request for a copy of the true and correct contract, Exhibits "58", "41", "24", filing a false contract with Hughes's lien claim, Exhibit "1", and lawsuit,  Exhibit "139", and refusing lawsuit disclosure, production, and deposition, Exhibit "129",  are indicators the he knew his representations were false.  Hughes's knew that his contract and billing representations were false, because he purposely made those representations appear consistent with the paragraph 4, terms of the contract, Exhibit "45".  Hughes created fraudulent actual cost representations, Exhibit "45".  Creating fraudulent actual cost representations was a deliberate, calculated, and knowing act, Exhibit "45". 

 

99.  Element 4:  Hughes made the representation with the intent that it be acted upon

Hughes presented a bill to Mowdy for payment, Exhibit "63".   The bill appeared to be in compliance with the written terms of the contract and expressing a charge for actual costs and additional charges for 10% overhead and 10% profit, Schedules of Values Exhibits "47", "29", "30", "45".  Hughes made the representation and presented bills that appeared to comply with the contract and demanded payment through force of law, Exhibit "1", "139", clearly with the intent that his false representation be acted upon.

 

100.  Element 5:  Mowdy took action in reliance upon the misrepresentation.

Hughes provided fraudulent representations of Hughes's final, Exhibit "63" bill, in invoices and "Schedules of Values" sent to Mowdy for periodic payments, Exhibits, invoices "26", "27", "28", "113", schedules of values, "47", "29", "30", "45".   The amounts charged in the invoices are totaled in Hughes's bill, Exhibit "63".  Mowdy took reliance and then action by making payments to Hughes based on Hughes's fraudulent representations, Exhibit "14". 

 

101.  Element 6: Mowdy suffered economic and non-economic damage.

Hughes's fraudulent representations and continued fraudulent representation of the contract terms caused Mowdy economic damages, Exhibit "183", stress and mental anguish, Exhibit "147".

 

102.  Liquidated Damages.  Mowdy seeks liquidated damages in the amount paid to Hughes in excess of Hughes's actual costs for material and labor plus 10% overhead and 10% profit, $93,060.91.

 

 

103.  Non-Economic Damages.    Mowdy seeks the non-economic damage determination that Hughes's actions were fraudulent, that Hughes presented fraudulent documents with fraudulent claims with the intent that they have full legal effect into official proceedings, a lien claim and a lawsuit.

 

104. Exemplary Damages.  Mowdy's injuries resulted from Hughes's actual fraud and culpable mental state as defined by Texas Penal Code 6.03, which entitles Mowdy to exemplary damages under TCP&RC Section 41.003(a), Exhibit "141",  and with malice as defined by TCP&RC Section 41.001(7), Exhibit "144".  The specific intent, nature, character, degree of culpability, and violation of sense of justice, of Hughes's actions are particularly outrageous and disturbing acts, against a senior citizen, and should be considered according to TCP&RC Section 41.011, Exhibit "142".   Mowdy seeks $200,000, in exemplary damages under TCP&R 41.008(b)(2).

 

 

 

L. Count 7 - Texas Civil Practices and Remedies

 

Code 12.002 - Liability - Lien Claim

 

105. TCP&RC 12.003(a)(8) provides cause of action for Texas Civil Practices and Remedies Code 12.002, Exhibit "145", which prohibits a person from making or presenting a document or other record with knowledge that the document is a fraudulent lien claim against real or personal property and with the intent that the document be given the same legal effect as a court record evidencing a valid lien or claim against real property or an interest in real property.

 

106.  On November 12, 2010, Hughes knowingly made and presented to the Williamson County Clerk a fraudulent document and on the basis of that fraudulent document claimed a lien against real property owned by Mowdy with the intent the fraudulent document be given legal court effect evidencing a valid lien against Mowdy's real property, Exhibit "1".  Hughes's intent was clearly evidenced because he maintained that false claim even after November 22, 2011, Exhibit "3", when he filed a separate sworn document proving the November 12, 2010, lien claim document, Exhibit "1", was false.  Hughes knew the charges made against Mowdy in his claim were false, Exhibit "14", "151".

 

 

107.  Hughes violated Texas Civil Practices and Remedies Code 12.002 by presenting a fraudulent document with intent that it have legal effect and did so with intent to cause financial harm and mental anguish to Mowdy.

 

108.  Hughes's actions caused financial harm, Exhibit "183",  and mental anguish, Exhibit "147",  to Mowdy who is a senior citizen on a fixed income.

 

109.  Damages.  Mowdy seeks damages as provided by TCP&RC 12.002(b) in the amount of $93.060.91, and all court costs, or alternatively the actual damages in Count 2, $27,216.30, as provided by TCP&RC 12.002(b), and all court costs, or alternatively $10,000, as provided by TCP&RC 12.002(a)(3)(a), and all court costs.

 

110.  Exemplary Damages.  Mowdy seeks exemplary damages, under TCP&RC 12.002(b) of $100,000.

 

 

M. Count 8 - Texas Civil Practices and Remedies

 

Code 12.002 - Liability - Lawsuit

 

111. TCP&RC 12.003(a)(8) provides cause of action for Texas Civil Practices and Remedies Code 12.002, Exhibit "145", which prohibits a person from making or presenting a document or other record with knowledge that the document is a fraudulent lien claim against real or personal property and with the intent that the document be given the same legal effect as a court record evidencing a valid lien or claim against real property or an interest in real property.

 

112.  On October 5, 2011, Hughes knowingly made and presented to the Williamson County District Clerk a fraudulent document and on the basis of that fraudulent document filed a lawsuit against Mowdy with the intent the fraudulent document be given legal court effect evidencing a valid claim against Mowdy's real property, Exhibit "1".  Hughes's intent was clearly evidenced because he maintained that fraudulent  claim even after November 22, 2011, Exhibit "3", when he filed a separate sworn document proving the November 12, 2010 lien claim document, Exhibit "1", was false.  Hughes knew the charges made against Mowdy in his lien claim were false, Exhibit "14", "151".

 

 

113.  Hughes violated Texas Civil Practices and Remedies Code 12.002 by presenting a fraudulent document with intent that it have legal effect and did so with intent to cause financial harm and mental anguish to Mowdy.

 

114.  Hughes's actions caused financial harm, Exhibit "183",  and mental anguish, Exhibit "147",  to Mowdy who is a senior citizen on a fixed income.

 

115.  Damages.  Mowdy seeks damages as provided by TCP&RC 12.002(b) in the amount of $93.060.91, and all expenses and court costs, or alternatively the actual damages in Count 2, $27,216.30, as provided by TCP&RC 12.002(b), and all expenses and court costs, or alternatively $10,000, as provided by TCP&RC 12.002(a)(3)(a), and all expenses and court costs.

 

116.  Exemplary Damages.  Mowdy seeks exemplary damages, under TCP&RC 12.002(b) of $100,000.

 

N. Count 9 - Texas Civil Practices and Remedies

 

Code 12.002 - Liability - Arbitration Claim

 

117. TCP&RC 12.003(a)(8) provides cause of action for Texas Civil Practices and Remedies Code 12.002, Exhibit "145", which prohibits a person from making or presenting a document or other record with knowledge that the document is a fraudulent lien claim against real or personal property and with the intent that the document be given the same legal effect as a court record evidencing a valid lien or claim against real property or an interest in real property.

 

118.  On January 4, 2013, in sworn deposition, Hughes knowingly presented,  in the AAA Case 70-527-E-00416-12 arbitration process, a fraudulent document, Exhibit "63", and on the basis of that fraudulent document substantiated Hughes's claim against Mowdy with the intent the fraudulent document be given legal effect evidencing a valid claim against Mowdy's real property, Exhibit "1", "303, page 43, line 25 through page 44, line 11".  Hughes's intent was clearly evidenced because he maintained that fraudulent  claim even after November 22, 2011, Exhibit "3", when he filed a separate sworn document proving the November 12, 2010 lien claim document, Exhibit "1", was false.  Hughes knew, in the deposition proceeding, the charges made against Mowdy in Hughes's claim were false, Exhibit "14", "151".

 

 

119.  Hughes violated Texas Civil Practices and Remedies Code 12.002 by presenting a fraudulent document with intent that it have legal effect and did so with intent to cause financial harm and mental anguish to Mowdy.

 

120.  Hughes's actions caused financial harm, Exhibit "183",  and mental anguish, Exhibit "147",  to Mowdy who is a senior citizen on a fixed income.   

 

121.  Damages.  Mowdy seeks damages as provided by TCP&RC 12.002(b) in the amount of $93.060.91, and all expenses and court costs, or alternatively the actual damages in Count 2, $27,216.30, as provided by TCP&RC 12.002(b), and all expenses and court costs, or alternatively $10,000, as provided by TCP&RC 12.002(a)(3)(a), and all expenses and court costs.

 

122.  Exemplary Damages.  Mowdy seeks exemplary damages, under TCP&RC 12.002(b) of $100,000.

 

O. Count 10, Texas Business and Commerce Code 17.46(b)(22)

123.  Hughes violated Texas Business and Commerce Code (TBCC) 17.46(b)(22) which prohibits the presentation of charges for work or materials that were not provided.  Hughes presented Mowdy with charges for work and materials that were not provided, Exhibit "63", "151", "2", "17".  In Hughes's deposition, he admitted he did not repair the concrete driveway, Exhibit "303, page 127, lines 1 through 20", and charged Mowdy twice for the same work.  Hughes charged Mowdy for repair of the concrete once in the USAA estimate and again in his supplemental estimate, and added profit and overhead to each separate charge for work he never performed, Exhibit "151".   Hughes did the same with  charges for the gable walls, photos Exhibit "191", and many other charges as indicated by Exhibit "151".  Hughes has been made aware of all this proof, but, has never amended his charges.  Mowdy seeks damages for Hughes's violations of TBCC 17.46(b)(22).

 

124.  Liquidated Damages.  Mowdy seeks Liquidated actual damages in the amount paid to Hughes in excess of Hughes's actual costs for material and labor plus 10% overhead and 10% profit, approximately $93,060.91, Exhibit "183, line f.".

 

125.  Exemplary Damages.  Mowdy's injuries resulted from Hughes's actual fraud and culpable mental state as defined by Texas Penal Code 6.03, which entitles Mowdy to exemplary damages under Texas Civil Practice & Remedies Code (TCP&RC), section 41.003(a), Exhibit "141",  and with malice as defined by TCP&RC 41.001(7), Exhibit "144".  The specific intent, nature, character, degree of culpability, and violation of sense of justice, of Hughes's actions are particularly outrageous and disturbing, against a senior citizen, and should be considered according to TCP&RC Section 4.011.   Mowdy seeks $100,000 in exemplary damages.

 

126.  Mental Anguish.   Texas Business and Commerce Code (TBCC) 17.50. RELIEF FOR CONSUMERS,  provides that a consumer may maintain a mental anguish action, TBCC 17.50(a)(1), for violations specifically enumerated under 17.46, such as 17.46(b)(22), when the consumer made reliance to the consumer's detriment, and for unconscionable action or course of action by any person.  TBCC 17.50(h), provides that Mowdy may recover damages without regard for Hughes's intentions.  Hughes did violate 17.46(b)(22) against Mowdy.  Mowdy did rely on Hughes's presentations to Mowdy's detriment.  All Hughes's actions and his course of action as shown by this brief, in total, were unconscionable.  Hughes has caused Mowdy severe mental anguish as shown by Exhibit "147", and by testimony of witnesses.  Mowdy is entitled to damages for mental anguish that was highly foreseeable and caused by premeditated shocking and disturbing acts of violations of Texas Business and Commerce Code, and fraud which caused actual financial harm and threatened Mowdy with the fraudulent loss of his home.  Mowdy is a retired citizen on a fixed income.  Hughes maintained fraudulent claims against Mowdy which threatened Mowdy's future financial well being, and completely disrupted Mowdy's life and the life of his family members since August 2010.  Hughes's deliberate and calculated acts were designed to force Mowdy to pay Hughes, or pay for an expensive legal battle.  Hughes created and maintained an extremely stressing and life changing situation for an extended and continuing period of time which has and will continue to cause Mowdy extensive mental anguish.  Exhibit "147" presents detailed evidence of the mental anguish suffered by Mowdy.  Mowdy seeks relief for mental anguish as provided by TBCC 17.50, (b)(1), at three times the economic damage.

 

P. Count 11, Texas Business and Commerce Code 17.46(b)(12) - Contract Paragraph 4.

127.  Hughes violated Texas Business and Commerce Code (TBCC) 17.46(b)(12), which states it is a violation to represent "that an agreement confers, or involves rights, remedies, or obligations which it does not have or involve, or which are prohibited by law".   TBCC 17.50(h), provides that Mowdy may recover damages without regard for Hughes's intentions.  Hughes represented the August 18, 2009, contract gave Mowdy the right to be charged Hughes's actual cost plus 10% overhead and 10% profit.  But, Hughes denied his contractual obligation and refused to observe Mowdy's contractual right and charged Mowdy more than Hughes's actual cost plus 10% overhead and 10% profit, Exhibit "3", "151".   Hughes made and demanded payment for work in excess of Hughes's actual cost, and for labor and materials that were not provided, Exhibit "63", "151", "2".   Mowdy seeks damages for Hughes's violations of TBCC 17.46(b)(12).

 

128.  Liquidated Damages.  Mowdy seeks Liquidated actual damages in the amount paid to Hughes in excess of Hughes's actual costs for material and labor plus 10% overhead and 10% profit, $93,060.91.

 

129.  Exemplary Damages.  Mowdy's injuries resulted from Hughes's actual fraud and culpable mental state as defined by Texas Penal Code 6.03, which entitles Mowdy to exemplary damages under Texas Civil Practice & Remedies Code (TCP&RC), section 41.003(a), Exhibit "141",  and with malice as defined by TCP&RC 41.001(7), Exhibit "144".  The specific intent, nature, character, degree of culpability, and violation of sense of justice, of Hughes's actions are particularly outrageous and disturbing, against a senior citizen, and should be considered according to TCP&RC Section 4.011.   Mowdy seeks $100,000 in exemplary damages.

 

130.  Mental Anguish.   Texas Business and Commerce Code (TBCC) 17.50. RELIEF FOR CONSUMERS,  provides that a consumer may maintain a mental anguish action, TBCC 17.50(a)(1), for violations specifically enumerated under 17.46, such as 17.46(b)(12), when the consumer made reliance to the consumer's detriment, and for unconscionable action or course of action by any person.  TBCC 17.50(h), provides that Mowdy may recover damages without regard for Hughes's intentions.  Hughes did violate 17.46(b)(12) against Mowdy.  Mowdy did rely on Hughes's presentations to Mowdy's detriment.  All Hughes's actions and his course of action as shown by this brief, in total, were unconscionable.  Hughes has caused Mowdy severe mental anguish as shown by Exhibit "147", and by testimony of witnesses.  Mowdy is entitled to damages for mental anguish that was highly foreseeable and caused by premeditated shocking and disturbing acts of violations of Texas Business and Commerce Code, and fraud which caused actual financial harm and threatened Mowdy with the fraudulent loss of his home.  Mowdy is a retired citizen on a fixed income.  Hughes maintained fraudulent claims against Mowdy which threatened Mowdy's future financial well being, and completely disrupted Mowdy's life and the life of his family members since August 2010.  Hughes's deliberate and calculated acts were designed to force Mowdy to pay Hughes, or pay for an expensive legal battle.  Hughes created and maintained an extremely stressing and life changing situation for an extended and continuing period of time which has and will continue to cause Mowdy extensive mental anguish.  Exhibit "147" presents detailed evidence of the mental anguish suffered by Mowdy.  Mowdy seeks relief for mental anguish as provided by TBCC 17.50, (b)(1), at three times the economic damage.

 

 

 

 

Q. Count 12, Texas Business and Commerce Code 17.46(b)(12) -

Contract Paragraph 2.

131.  Hughes violated Texas Business and Commerce Code (TBCC) 17.46(b)(12), which states it is a violation to represent "that an agreement confers, or involves rights, remedies, or obligations which it does not have or involve, or which are prohibited by law".   TBCC 17.50(h), provides that Mowdy may recover damages without regard for Hughes's intentions.  Hughes represented the August 18, 2009 contract gave Mowdy the right to be charged no more than the amount allowed by the insurance carrier, $377,018.40.    But, Hughes denied his contractual obligation and refused to observe Mowdy's contractual right and charged Mowdy more than the amount allowed by the insurance carrier, Exhibit "1".  Hughes made and demanded payment excess of Hughes's the amount allowed by the insurance carrier, and for labor and materials that were not provided, Exhibit "63", "151", "2".   Hughes promised Mowdy contractual rights.   Hughes then refused to observe his written obligation and refused Mowdy's contractual right to be charged no more than the maximum allowed by paragraph 2, of the August 18, 2009 contract, Exhibit "3".  Mowdy seeks damages for Hughes's violation of TBCC 17.46(b)(12).

 

132.  Liquidated Damages.  Mowdy seeks Liquidated actual damages in the amount paid to Hughes in excess of Hughes's actual costs for material and labor plus 10% overhead and 10% profit, $93,060.91.

 

133. Exemplary Damages.  Mowdy's injuries resulted from Hughes's actual fraud and culpable mental state as defined by Texas Penal Code 6.03, which entitles Mowdy to exemplary damages under Texas Civil Practice & Remedies Code (TCP&RC), section 41.003(a), Exhibit "141",  and with malice as defined by TCP&RC 41.001(7), Exhibit "144".  The specific intent, nature, character, degree of culpability, and violation of sense of justice, of Hughes's actions are particularly outrageous and disturbing, against a senior citizen, and should be considered according to TCP&RC Section 4.011.   Mowdy seeks $100,000 in exemplary damages.

 

134.  Mental Anguish.   Texas Business and Commerce Code (TBCC) 17.50. RELIEF FOR CONSUMERS,  provides that a consumer may maintain a mental anguish action, TBCC 17.50(a)(1), for violations specifically enumerated under 17.46, such as 17.46(b)(12), when the consumer made reliance to the consumer's detriment, and for unconscionable action or course of action by any person.  TBCC 17.50(h), provides that Mowdy may recover damages without regard for Hughes's intentions.  Hughes did violate 17.46(b)(12) against Mowdy.  Mowdy did rely on Hughes's presentations to Mowdy's detriment.  All Hughes's actions and his course of action as shown by this brief, in total, were unconscionable.  Hughes has caused Mowdy severe mental anguish as shown by Exhibit "147", and by testimony of witnesses.  Mowdy is entitled to damages for mental anguish that was highly foreseeable and caused by premeditated shocking and disturbing acts of violations of Texas Business and Commerce Code, and fraud which caused actual financial harm and threatened Mowdy with the fraudulent loss of his home.  Mowdy is a retired citizen on a fixed income.  Hughes maintained fraudulent claims against Mowdy which threatened Mowdy's future financial well being, and completely disrupted Mowdy's life and the life of his family members since August 2010.  Hughes's deliberate and calculated acts were designed to force Mowdy to pay Hughes, or pay for an expensive legal battle.  Hughes created and maintained an extremely stressing and life changing situation for an extended and continuing period of time which has and will continue to cause Mowdy extensive mental anguish.  Exhibit "147" presents detailed evidence of the mental anguish suffered by Mowdy.  Mowdy seeks relief for mental anguish as provided by TBCC 17.50, (b)(1), at three times the economic damage.

 

R. Count 13 - Removal / Release of Invalid Lien Claim

 

135.  Mowdy seeks the removal of Hughes invalid November 12, 2010, lien claim for the reasons as presented in Mowdy's Motion for Summary Removal of Invalid Lien Claim and as otherwise filed and warranted in this arbitration.

 

S. Count 14 - Determination of Violation of Texas Penal Code 32.49.

136.  Mowdy seeks the Honorable Arbitrator's determination that Hughes violated Texas Penal Code 32.49 by failing to provide Mowdy a release of fraudulent lien claim as requested on November 1, 2011, Exhibit "56".

 

 

 

 

T. Count 15 - Texas Business and Commerce Code 17.46 -

TX Property Code 41.007(b) - Exhibit "1" Contract

 

 

137.  The Exhibit "1", contract Hughes filed to fix a foreclose a lien on Mowdy's property did not contain the warning required by Texas Property Code 41.007.  Such warning is required by 41.007(a), and cannot be found on the Exhibit "1" contract.  Texas property code 41.007(b) identifies a violation of the 41.007(a) requirement as a violation within the false, misleading, or deceptive act or practice meaning of Section 17.46, Texas Business and Commerce Code and makes such violation actionable in civil suit.      

 

§ 41.007. HOME IMPROVEMENT CONTRACT.  (a) A contract described by Section 41.001(b)(3) must contain the following warning conspicuously printed, stamped, or typed in a size equal to at least 10-point bold type or computer equivalent, next to the owner's signature line on the contract:

 

                "IMPORTANT NOTICE:  You and your contractor are responsible for meeting the terms and conditions of this contract.  If you sign this contract and you fail to meet the terms and conditions of this

contract, you may lose your legal ownership rights in your home.  KNOW YOUR RIGHTS AND DUTIES UNDER THE LAW."

 

                (b)  A violation of Subsection (a) of this section is a false, misleading, or deceptive act or practice within the meaning of Section 17.46, Business & Commerce Code, and is actionable in a public or private suit brought under the provisions of the Deceptive Trade Practices-Consumer Protection Act (Subchapter E, Chapter 17, Business & Commerce Code).

 

 

 

§ 41.001. INTERESTS IN LAND EXEMPT FROM SEIZURE.  (a) A homestead and one or more lots used for a place of burial of the dead are exempt from seizure for the claims of creditors except for encumbrances properly fixed on homestead property.

 

                (b)  Encumbrances may be properly fixed on homestead

property for:          

                                (1)  purchase money;                                                         

                                (2)  taxes on the property;                                                  

                                (3)  work and material used in constructing improvements on the property if contracted for in writing as provided by Sections 53.254(a), (b), and (c);

 

 

138.  Hughes failed to include the 41.007(a) warning, violated TB&CC 17.46, and caused economic damage and mental anguish to Mowdy.

139.   Liquidated Damages.  Mowdy seeks Liquidated actual damages in the amount Hughes has cost Mowdy in this matter.  That amount is contained in the most recent version of Mowdy's Exhibit "74".

 

140. Exemplary Damages.  Mowdy's injuries resulted from Hughes's actual fraud and culpable mental state as defined by Texas Penal Code 6.03, which entitles Mowdy to exemplary damages under Texas Civil Practice & Remedies Code (TCP&RC), section 41.003(a), Exhibit "141",  and with malice as defined by TCP&RC 41.001(7), Exhibit "144".  The specific intent, nature, character, degree of culpability, and violation of sense of justice, of Hughes's actions are particularly outrageous and disturbing, against a senior citizen, and should be considered according to TCP&RC Section 4.011.   Mowdy seeks $100,000 in exemplary damages.

 

141.  Mental Anguish.   Texas Business and Commerce Code (TBCC) 17.50. RELIEF FOR CONSUMERS,  provides that a consumer may maintain a mental anguish action, TBCC 17.50(a)(1), for violations specifically enumerated under 17.46, such as 17.46(b)(12), when the consumer made reliance to the consumer's detriment, and for unconscionable action or course of action by any person.  TBCC 17.50(h), provides that Mowdy may recover damages without regard for Hughes's intentions.  Hughes did violate 17.46 against Mowdy.  Mowdy did rely on Hughes's presentations to Mowdy's detriment.  All Hughes's actions and his course of action as shown by this brief, in total, were unconscionable.  Hughes has caused Mowdy severe mental anguish as shown by Exhibit "147", and by testimony of witnesses.  Mowdy is entitled to damages for mental anguish that was highly foreseeable and caused by premeditated shocking and disturbing acts of violations of Texas Business and Commerce Code, and fraud which caused actual financial harm and threatened Mowdy with the fraudulent loss of his home.  Mowdy is a retired citizen on a fixed income.  Hughes maintained fraudulent claims against Mowdy which threatened Mowdy's future financial well being, and completely disrupted Mowdy's life and the life of his family members since August 2010.  Hughes's deliberate and calculated acts were designed to force Mowdy to pay Hughes, or pay for an expensive legal battle.  Hughes created and maintained an extremely stressing and life changing situation for an extended and continuing period of time which has and will continue to cause Mowdy extensive mental anguish.  Exhibit "147" presents detailed evidence of the mental anguish suffered by Mowdy.  Mowdy seeks relief for mental anguish as provided by TBCC 17.50, (b)(1), at three times the economic damage.

 

 

 

 

U. Count 16 - Texas Business and Commerce Code 17.46 -

TX Property Code 41.007(b) - Exhibit "3" Contract

 

 

142.  The Exhibit "3", contract Hughes filed to fix a foreclose a lien on Mowdy's property did not contain the warning required by Texas Property Code 41.007.  Such warning is required by 41.007(a), and cannot be found on the Exhibit "3" contract.  Texas property code 41.007(b) identifies a violation of the 41.007(a) requirement as a violation within the false, misleading, or deceptive act or practice meaning of Section 17.46, Texas Business and Commerce Code and makes such violation actionable in civil suit.     

 

§ 41.007. HOME IMPROVEMENT CONTRACT.  (a) A contract described by Section 41.001(b)(3) must contain the following warning conspicuously printed, stamped, or typed in a size equal to at least 10-point bold type or computer equivalent, next to the owner's signature line on the contract:

 

                "IMPORTANT NOTICE:  You and your contractor are responsible for meeting the terms and conditions of this contract.  If you sign this contract and you fail to meet the terms and conditions of this

contract, you may lose your legal ownership rights in your home.  KNOW YOUR RIGHTS AND DUTIES UNDER THE LAW."

 

                (b)  A violation of Subsection (a) of this section is a false, misleading, or deceptive act or practice within the meaning of Section 17.46, Business & Commerce Code, and is actionable in a public or private suit brought under the provisions of the Deceptive Trade Practices-Consumer Protection Act (Subchapter E, Chapter 17, Business & Commerce Code).

 

 

 

§ 41.001. INTERESTS IN LAND EXEMPT FROM SEIZURE.  (a) A homestead and one or more lots used for a place of burial of the dead are exempt from seizure for the claims of creditors except for encumbrances properly fixed on homestead property.

 

                (b)  Encumbrances may be properly fixed on homestead

property for:          

                                (1)  purchase money;                                                          

                                (2)  taxes on the property;                                                  

                                (3)  work and material used in constructing improvements on the property if contracted for in writing as provided by Sections 53.254(a), (b), and (c);

 

 

143.  Hughes cannot argue the Exhibit "3" contract was not filed to fix the lien without arguing against his own claims.  Hughes failed to include the 41.007(a) warning, violated TB&CC 17.46, and caused economic damage and mental anguish to Mowdy.

 

144.   Liquidated Damages.  Mowdy seeks Liquidated actual damages in the amount Hughes has cost Mowdy in this matter.  That amount is contained in the most recent version of Mowdy's Exhibit "74".

 

145. Exemplary Damages.  Mowdy's injuries resulted from Hughes's actual fraud and culpable mental state as defined by Texas Penal Code 6.03, which entitles Mowdy to exemplary damages under Texas Civil Practice & Remedies Code (TCP&RC), section 41.003(a), Exhibit "141",  and with malice as defined by TCP&RC 41.001(7), Exhibit "144".  The specific intent, nature, character, degree of culpability, and violation of sense of justice, of Hughes's actions are particularly outrageous and disturbing, against a senior citizen, and should be considered according to TCP&RC Section 4.011.   Mowdy seeks $100,000 in exemplary damages.

 

146.  Mental Anguish.   Texas Business and Commerce Code (TBCC) 17.50. RELIEF FOR CONSUMERS,  provides that a consumer may maintain a mental anguish action, TBCC 17.50(a)(1), for violations specifically enumerated under 17.46, such as 17.46(b)(12), when the consumer made reliance to the consumer's detriment, and for unconscionable action or course of action by any person.  TBCC 17.50(h), provides that Mowdy may recover damages without regard for Hughes's intentions.  Hughes did violate 17.46 against Mowdy.  Mowdy did rely on Hughes's presentations to Mowdy's detriment.  All Hughes's actions and his course of action as shown by this brief, in total, were unconscionable.  Hughes has caused Mowdy severe mental anguish as shown by Exhibit "147", and by testimony of witnesses.  Mowdy is entitled to damages for mental anguish that was highly foreseeable and caused by premeditated shocking and disturbing acts of violations of Texas Business and Commerce Code, and fraud which caused actual financial harm and threatened Mowdy with the fraudulent loss of his home.  Mowdy is a retired citizen on a fixed income.  Hughes maintained fraudulent claims against Mowdy which threatened Mowdy's future financial well being, and completely disrupted Mowdy's life and the life of his family members since August 2010.  Hughes's deliberate and calculated acts were designed to force Mowdy to pay Hughes, or pay for an expensive legal battle.  Hughes created and maintained an extremely stressing and life changing situation for an extended and continuing period of time which has and will continue to cause Mowdy extensive mental anguish.  Exhibit "147" presents detailed evidence of the mental anguish suffered by Mowdy.  Mowdy seeks relief for mental anguish as provided by TBCC 17.50, (b)(1), at three times the economic damage.

 

 

 

V. Conditions Precedent

 

147.  All conditions precedent to Mowdy's claim for relief have been performed or have occurred.

 

W. Summary

148.  Hughes's actions are illegal, immoral, predatory, outrageous, and extremely harmful to society.   Hughes made false promises and planned and maintained false claims in an attempt to abusively use the law to force another person from their home while Hughes had already made a gain far beyond his expectations, Exhibit "183", "45".   The facts are clear and evident that Hughes has caused Mowdy financial damage, and extreme mental anguish as Mowdy claims.    

 

 

 

X. Prayer

 

149. For these reasons, Mowdy seeks relief by a finding on each count, that may be used in additional legal processes, and asks to be awarded a total within the approved $500,000.00 award limitations.

 

150.  Mowdy request the Honorable Arbitrator award Mowdy all costs for arbitration and expenses Hughes caused Mowdy to incur as evidenced in Exhibit "150".  Exhibit "1504" will be revised to show final expenses.

 

151.  Mowdy requests the award of pre and post judgment interest as provided by Texas Finance Code 304.102.


 

 

152.  Mowdy seeks the Honorable Arbitrator's determination of facts as shown in Exhibit "306".

 

Respectfully Submitted,

 

 

Thomas C. Mowdy

1805 Carey Avenue

Taylor, TX 76574

(512) 565-1035

669; 033

                                    

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