Los Arboles Tulum, L.P. and Greg Schnurr v. Matula Family, L.P.

TEXAS COURT OF APPEALS, THIRD DISTRICT, AT AUSTIN

NO. 03-23-00488-CV

Los Arboles Tulum, L.P. and Greg Schnurr, Appellants

v.

Matula Family, L.P., Appellee

FROM THE 345TH DISTRICT COURT OF TRAVIS COUNTY
NO. D-1-GN-19-006429, THE HONORABLE MAYA GUERRA GAMBLE, JUDGE PRESIDING

MEMORANDUM OPINION

This is an appeal from a summary judgment in favor of Matula Family, L.P. in its

suit against Los Arboles Tulum, L.P. and Greg Schnurr for breach of a promissory note and

personal guaranty. In two issues, Schnurr argues that (1) the trial court erred in granting

summary judgment on Matula’s claim for breach of personal guaranty because the evidence

raises a genuine issue of material fact on Schnurr’s affirmative defense of material alteration of

the underlying promissory note and (2) the trial court committed various errors in determining

the amount of interest accrued on the note. We will affirm the trial court’s judgment.

BACKGROUND

This dispute arises from the breach of a promissory note and guaranty. In 2012,

Greg Schnurr solicited Michael Matula for a loan to develop a residential community in Tulum,
Mexico. Matula agreed, and the parties memorialized their agreement in an instrument

consisting of a Promissory Note and Guaranty.

Under the Promissory Note, Matula’s entity, Matula Family, L.P., loaned

Schnurr’s entity, Los Arboles, L.P., the principal amount of $750,000 with interest accruing

monthly at pre- and post-maturity rates. Schnurr signed the Promissory Note as follows:

Under the Guaranty, Schnurr “absolutely, irrevocably, and unconditionally

guarantee[d] payment of th[e] note according to its terms to the extent as if [he] were Borrower

on the note.” Schnurr signed the Guaranty as follows:

Shortly thereafter, the parties executed a second instrument, an Amendment to the

Promissory Note, which increased the principal amount by $100,000. The Amendment

expressly states that: “All Terms of Payment, Security, Promises, Guaranty, and Defaults of the

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Original Note will convey to this Amendment.” Schnurr signed the Amendment the same way

he signed the Promissory Note:

It is undisputed that Los Arboles and Schnurr never paid any of the principal and

eventually defaulted, leading to Matula filing suit.

PROCEDURAL HISTORY

Matula sued on the Promissory Note and Guaranty and asserted several other

related claims. Schnurr answered with a general denial but did not assert any affirmative

defenses or counterclaims.

Matula moved for partial summary judgment on liability and damages for its

claims for breach of the Promissory Note and breach of the Guaranty. In support of its motion,

Matula filed a declaration from its manager (Michael Matula) and accompanying amortization

schedule. The schedule listed the monthly balance on the Promissory Note, Los Arboles’

payments credited to that balance, and the compounding interest on the prior month’s balance.

In response, Schnurr argued that he did not consent in his capacity as guarantor to

the Amendment to the Promissory Note and that, as a result, the Amendment constituted a

material alteration that discharged him from liability under the Guaranty. Schnurr further argued

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that Matula’s declaration and amortization schedule were conclusory and required additional

supporting documentation. Importantly for purposes of this appeal, Schnurr did not argue in his

response that the note provides for simple rather than compound interest. Nor did Schnurr

challenge Matula’s method of calculating the interest accrued on the note.

After a hearing, the trial court granted Matula’s partial-summary-judgment

motion. In its order, the trial court ruled that Matula was entitled to judgment as a matter of law

on its claim against Los Arboles for breach of the Promissory Note and its claim against Schnurr

for breach of the Guaranty. The trial court ordered that Matula recover a judgment, jointly and

severally, from Los Arboles and Schnurr in the amount of $2,683,235.67.

Matula non-suited its remaining claims and moved for entry of final judgment.

Schnurr then filed a series of amended answers that asserted new counterclaims for breach of

contract and usury, arguing, for the first time, that the note provides for simple interest only and

that Matula had breached the note by charging compound interest at a usurious rate. Matula

objected to Schnurr’s counterclaims as untimely and improperly filed without leave. Matula

further argued that Schnurr’s counterclaims were intertwined with, and thus precluded by, the

trial court’s summary judgment on Matula’s claims for breach of the Promissory Note

and breach of the Guaranty. The trial court struck Schnurr’s amended pleadings and entered

final judgment.

Schnurr moved for a new trial, arguing, for the first time, that Matula’s

calculation of the interest accrued on the note erroneously employed a “360-day year

convention” and applied the higher, post-maturity interest rate one month too early. Schnurr’s

motion for new trial was overruled by operation of law.

Schnurr appeals.

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MATERIAL ALTERATION

In his first issue, Schnurr argues that the trial court erred in granting summary

judgment on Matula’s claim for breach of personal guaranty because the evidence raises a

genuine issue of material fact as to whether the Amendment to the Promissory Note constitutes a

material alteration that discharges Schnurr from liability under the guaranty.

Matula’s initial response is that Schnurr failed to preserve the issue for our

review. We disagree. Although Schnurr had not yet pleaded material alteration when he raised

it in his response to Matula’s partial-summary-judgment motion, and Matula objected to the

defense as unpleaded and untimely raised, Matula did not obtain a ruling on its objection, and the

order granting Matula’s motion states that the trial court considered Schnurr’s response and

arguments. Therefore, the issue is preserved for our review. See B.C. v. Steak N Shake

Operations, Inc., 598 S.W.3d 256, 259–62 (Tex. 2020) (per curiam) (recital in

summary-judgment order that trial court considered “evidence and arguments of counsel”

affirmatively indicated that trial court considered non-movant’s untimely response when movant

objected to but did not obtain ruling on timeliness of response). We now turn to the merits.

Under Texas law, a guarantor is discharged from performance of a guaranty if he

proves a material alteration of the underlying note. U.S. Foodservice, Inc. v. Winfield Project

Mgmt., LLC, No. 03-14-00405-CV, 2016 WL 1639804, at *5 (Tex. App.—Austin Apr. 20, 2016,

no pet.) (mem. op.). In a claim for breach of a personal guaranty, material alteration is an

affirmative defense. Id. To defeat summary judgment, then, Schnurr had the burden to produce

evidence raising a fact issue on each element of the defense. That is, Schnurr had to produce

evidence raising fact issues as to whether there had been:

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(1) a material alteration of the promissory note (i.e., one
impacting the risk that Schnurr had agreed to assume),

(2) made without his consent, and

(3) to his detriment (i.e., prejudicial to his interest).

Id. (elements of material-alteration defense).

It is undisputed that the Amendment itself satisfies the first and third elements.

The Amendment is a material alteration of the Promissory Note to Schnurr’s detriment: By

increasing the principal balance of the Promissory Note, the Amendment increased the risk

Schnurr agreed to assume and thereby prejudiced Schnurr’s interest.

The issue here is whether Schnurr produced evidence of the second element—

evidence that Los Arboles and Matula agreed to increase the balance of the Promissory Note

without Schnurr’s consent. Schnurr did not produce any affidavit, declaration, deposition

testimony, or contemporaneous communication stating that he was unaware of or otherwise did

not consent to the Amendment. And the Amendment expressly states that the Guaranty “will

convey” to the amended note and is signed by Schnurr himself.

Schnurr nevertheless contends that his signature of the Amendment does not show

he consented in his personal capacity as guarantor. Rather, Schnurr insists, his signature only

shows he consented in his corporate capacity as representative of Los Arboles. Schnurr’s

contention is presumably based in part on an apparent discrepancy between the first instrument

(consisting of the Promissory Note and Guaranty) and the second instrument (consisting of

the Amendment).

In the first instrument, there are two signatures, one for the Promissory Note and

one for the Guaranty. Schnurr’s signature for the Promissory Note includes a signature block

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with his corporate title and other information indicating that he is signing in his corporate

capacity on behalf of Los Arboles. Schnurr’s signature for the Guaranty contains no such

information, indicating he is signing in his personal capacity.

In the second instrument, there is only one agreement (the Amendment), and there

is only one signature. Schnurr’s signature for the Amendment is the same as his signature for the

Promissory Note: It includes the same signature block indicating Schnurr is signing in a

corporate capacity.

So, what Schnurr seems to be suggesting is that because the Amendment doesn’t

include a signature line like the one for the Guaranty, but does include a signature line like the

one for the Promissory Note, his signature of the Amendment shows he signed in his corporate

capacity but not in his personal capacity. The two different types of signature in the first

instrument show that the parties know how to distinguish a signature in a corporate capacity

from a signature in a personal capacity. Had they intended that Schnurr sign the Amendment in

his personal capacity, they would have included a second signature line without a signature

block, like the one for the Guaranty. Because they did not, they did not intend that Schnurr sign

in his personal capacity. And because Schnurr didn’t sign in his personal capacity, he didn’t

consent in his personal capacity as guarantor.

We disagree. On these facts, Schnurr’s signature to the Amendment is evidence

that he consented in his personal capacity as guarantor. This is because Schnurr is the owner and

manager of Los Arboles. And as owner and manager, it was his decision to borrow the

additional funds. Because it was his decision to amend the note, he cannot claim that he did not

consent to it.

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The basic rationale of the defense of material alteration is that it is unfair to hold a

guarantor liable for a contract when the terms are changed without his consent, since the

guarantor agreed to assume the risks of the original contract but not the risks of the altered one.

See Old Colony Ins. v. City of Quitman, 352 S.W.2d 452, 455–56 (Tex. 1961). Thus, in a

lending context, the defense will typically apply when the person who materially alters the note

on behalf of the borrower is distinct from the person who guaranteed the note. See, e.g., Vastine

v. Bank of Dallas, 808 S.W.2d 463, 464 (Tex. 1991) (per curiam) (individual guarantor raised

fact issue whether shareholders acting on behalf of corporate borrower materially altered

contract). In such a case, the former person alters the note without the latter person knowing

about or otherwise agreeing to the alteration, so the alteration is made without the latter’s

consent. But here, the former person couldn’t have altered the note without the latter person

knowing about it, since the former and the latter are one and the same: Schnurr.

Texas courts have recognized that when “[t]he only alteration of the [note] was

made by the guarantor himself, who signed the [amendment] in his corporate capacity,” the

alteration cannot be said to have been made without the guarantor’s consent. Chambers

v. NCNB Tex. Nat’l Bank, 841 S.W.2d 132, 135 (Tex. App.—Houston [14th Dist.] 1992, no

writ). Here, not only was the alteration made by the guarantor himself, it explicitly states that the

terms of the Guaranty “will convey” to the Amendment. And the Amendment contains no

indicia otherwise indicating that Schnurr did not consent in his personal capacity, such as a

second, unsigned signature line for the note’s guarantor. See, e.g., Beal Bank, SSB v. Biggers,

227 S.W.3d 187, 192 (Tex. App.—Houston [1st Dist.] 2007, no pet.) (holding that corporate

debtor’s president and secretary did not consent to loan modification as guarantors when they

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signed modification in their corporate capacities and as “Borrower” but left blank signature line

for “endorsers, guarantors, and/or sureties”).

“This is not a case in which [a] hard-working and loyal company employee[]” has

been “lured into personally guaranteeing the debts of [his] employer despite the fact that [he]

sign[ed] the document solely in [his] official capacity.” 84 Lumber Co. v. Powers, 393 S.W.3d 299,

305 (Tex. App.—Houston [1st Dist.] 2012, pet. denied) (cleaned up). “Rather, this is the

[owner] securing credit for his own business.” Id.

We hold Schnurr failed to produce evidence raising a fact issue on the second

element of his affirmative defense. Therefore, we overrule Schnurr’s first issue.

INTEREST

In his second issue, Schnurr contends that the trial court committed three errors in

determining the amount of interest accrued on the note. First, Schnurr contends that the trial

court erroneously construed the note as providing for compound rather than simple interest.

Second, Schnurr contends that the trial court erroneously used “a 360-day year convention.”

Third, Schnurr contends that the trial court erroneously applied the higher, post-maturity interest

rate one month too early.

Matula responds that Schnurr has waived these arguments because he did not

raise them until after the trial court granted summary judgment. We agree with Matula.

Schnurr first raised his simple-interest argument indirectly through counterclaims

for breach of contract and usury. Schnurr asserted these counterclaims in second, third, and

fourth amended answers filed without leave after the trial court granted summary judgment on

Matula’s claims for breach of the Promissory Note and breach of the Guaranty—including

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summary judgment on the amount of interest that had accrued. In other words, Schnurr first

raised his argument that the note provides for simple interest after the trial court rendered

judgment on interest.

Matula objected that Schnurr’s counterclaims were improperly filed without leave

after the rendition of summary judgment. See Brumfield v. Williamson, 634 S.W.3d 170, 211

(Tex. App.—Houston [1st Dist.] 2021, pet. denied) (“A trial court cannot grant a motion to

amend the pleadings once it renders summary judgment.”). Matula further objected that the

basis for Schnurr’s counterclaims—Schnurr’s argument that the note provides for simple rather

than compound interest—was “intertwined with, and precluded by, the trial court’s summary

judgment on [Matula’s] note claim[].” HHH Farms, L.L.C. v. Fannin Bank, 648 S.W.3d 387,

419 (Tex. App.—Texarkana 2022, pet. denied) (trial court’s grant of summary judgment on

bank’s breach-of-note claim precluded debtors’ usury counterclaim when usury counterclaim

was “intertwined” with note claim); see also Sturm v. Muens, 224 S.W.3d 758, 765 (Tex. App.—

Houston [14th Dist.] 2007, no pet.) (although partial summary judgment in favor of plaintiff’s

breach-of-note claim did not expressly adjudicate defendant’s usury counterclaim, summary

judgment nevertheless constituted indirect ruling on counterclaim, since “a final judgment

granting relief on both the note claim and usury claim would contradict itself”). The trial court

agreed and, in its final judgment, ordered that Schnurr’s counterclaims be stricken. On appeal,

Schnurr does not challenge the trial court’s order, so his stricken counterclaims do not preserve

his simple-interest argument for appeal.

Schnurr raised his simple-interest argument again in his motion for new trial, this

time directly arguing that “the note at issue does not provide for the amount of interest that was

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incorporated in the Court’s Final Judgment because [Matula] incorrectly charged [Schnurr]

compound interest under the note.” This was too late.1

When a party fails to raise an argument to defeat summary judgment in its

response to the summary-judgment motion, the party normally waives his right to raise that

argument in a post-judgment motion. See Tex. R. Civ. P. 166a(c) (“Issues not expressly

presented to the trial court by written motion, answer or other response shall not be considered

on appeal as grounds for reversal.”); Unifund CCR Partners v. Weaver, 262 S.W.3d 796, 797–98

(Tex. 2008) (per curiam) (argument first raised by non-movant in post-judgment filing did not

preserve argument for appeal); Brookshire Katy Drainage Dist. v. Lily Gardens, LLC,

333 S.W.3d 301, 307 n.3 (Tex. App.—Houston [1st Dist.] 2010, pet. denied) (“New arguments

to defeat summary judgment presented after the trial court has granted summary judgment do not

warrant reversal.”). Likewise, when a party raises an argument for the first time in a

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The dissent contends that a “complaint regarding an interest award” may be preserved
by a motion for new trial or a motion to amend or to correct the judgment. Not necessarily. It
depends in part on the circumstances under which the issue arises. When, as here, the interest
rate is a disputed issue of contractual interpretation on which a party moves for summary
judgment, the proper time to raise and thus preserve any argument against that interpretation is in
the response to the motion for summary judgment—not after the trial court has considered and
ruled on it. See Tex. R. App. P. 33.1(a)(1); Tex. R. Civ. P. 166a(c); Unifund CCR Partners
v. Weaver, 262 S.W.3d 796, 797–98 (Tex. 2008) (per curiam); Brookshire Katy Drainage Dist.
v. Lily Gardens, LLC, 333 S.W.3d 301, 307 n.3 (Tex. App.—Houston [1st Dist.] 2010, pet.
denied). In none of the cases cited by the dissent was the applicable interest rate the subject of a
motion for summary judgment. For example, two of the cited cases involve pre- and post-
judgment interest. Keith v. Keith, 221 S.W.3d 156, 172 (Tex. App.—Houston [1st Dist.] 2006, no
pet.); Miller v. Kendall, 804 S.W.2d 933, 944 (Tex. App.—Houston [1st Dist.] 1990, no writ).
So, the issues regarding their award (or lack thereof) didn’t arise until after the trial court had
rendered judgment—and even then, there wouldn’t have been any fact issue regarding their
calculation, since their rates are set by statute. See, e.g., Tex. Fin. Code § 304.003. And in a
third case, although the trial court modified the interest award in response to a motion for new
trial, the parties agreed that the interest award should have been modified, so there wasn’t any
dispute for the trial court to resolve—and thus no complaint to preserve. McLemore v. Pacific
Sw. Bank, FSB, 872 S.W.2d 286, 290–91 (Tex. App.—Texarkana 1994, writ. dism’d).
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post-judgment motion, that argument generally isn’t preserved for appellate review. See Tex. R.

App. P. 33.1(a)(1) (“As a prerequisite to presenting a complaint for appellate review, the record

must show that . . . the complaint was made to the trial court by a timely request, objection or

motion . . . .” (emphasis added)); Weaver, 262 S.W.3d at 797–98; Kelley-Coppedge, Inc.

v. Highlands Ins., 980 S.W.2d 462, 467 (Tex. 1998) (holding that party waived argument raised

for first time in new-trial motion). Because Schnurr did not raise his simple-interest argument

until after the trial court had granted summary judgment on interest, we hold that he has waived

the argument for appellate review and we may not consider it as grounds for reversal.

Similarly, Schnurr’s other arguments regarding the calculation of interest—that

the trial court erroneously used a 360-day year convention and erroneously applied the higher,

post-maturity interest rate one month too early—could have been raised, and should have been

raised, in response to Matula’s summary-judgment motion. They were not. Instead, Schnurr

waited until Matula’s summary-judgment motion had been filed, heard, and ruled on. Thus, the

only evidence regarding the calculation of interest that was before the trial court at summary

judgment was the unchallenged calculation by Matula. Because Schnurr did not raise his

arguments challenging Matula’s calculation of interest until after the trial court had granted

summary judgment on interest, we hold that he has waived the arguments for appellate review

and we may not consider it as grounds for reversal.

We overrule Schnurr’s second issue.

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CONCLUSION

For the reasons above we affirm the trial court’s judgment.

__________________________________________
Maggie Ellis, Justice

Before Justices Kelly, Crump, and Ellis
Dissenting Opinion by Justice Crump

Affirmed

Filed: August 29, 2025

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