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affirming trial court's decision to shorten notice of summary-judgment hearing, in part because nonmovants failed to show they were harmed by the ruling
Summary of this case from Neese v. Ted B. Lyon, Jr., Marquette W. Wolf, Ted B. Lyon & Assocs., P.C.Opinion
NO. 12-11-00055-CV
08-30-2012
IN THE ESTATE OF MILDRED SNOW, DECEASED
APPEAL FROM THE
COUNTY COURT AT LAW
CHEROKEE COUNTY, TEXAS
MEMORANDUM OPINION
Keith Wells, Andria Medley Stewart, Blanche Phillips, and Carrie Sterling, all heirs of Mildred Snow, appeal from the trial court's final judgment in a suit for specific performance filed by Claude Dotson, Jr. and Faye Dotson. Appellants raise six issues. We affirm the trial court's judgment.
BACKGROUND
On December 10, 1993, Mildred Snow, an elderly widow, entered into a contract with Claude Dotson entitled "Lease with Options to Purchase." Pursuant to the terms of the contract, Dotson leased Snow's land, comprising four tracts totaling over 300 acres, for $2,500.00 per year. The contract further provided Dotson a twenty year option to purchase the property with all lease payments serving as credits toward the final purchase price. Additionally, one tract of land was to be transferred to Dotson on November 30, 2003, for no additional consideration other than the lease payments already made through January 1, 2003. Snow transferred that tract as required by the contract.
The judgment references 279.5027 acres while the lease is less clear but references as many as 368.5027 acres. We find no explanation for the discrepancy in the record, but it has no bearing on the issues before us.
Snow died on April 30, 2005. Harold Lewis was appointed as executor of Snow's estate. On September 22, 2005, the Dotsons sent a letter to Lewis declaring their intention to exercise their option to purchase the remaining three tracts of land pursuant to the contract between Dotson and Snow. Appellants thereafter notified Lewis that they would not sign a deed conveying title to the land to Dotson and threatened to sue Lewis if he signed the deed.
On October 13, 2005, the Dotsons filed suit seeking specific performance of the option provision of the contract. The Dotsons' petition alleged two avenues by which they were entitled to seek specific performance—breach of contract and Section 27 of the Texas Probate Code. Appellants answered and later pleaded affirmative defenses of unconscionability, breach of contract, failure of consideration, fraud, fraud in the inducement, statutory fraud, and unjust enrichment, and counterclaims asserting breach of fiduciary duty, breach of contract, fraud, fraud in the inducement, statutory fraud, and unjust enrichment. The Dotsons filed a motion for summary judgment, contending entitlement to specific performance on their Section 27 claim. The Dotsons also contended that Appellants' counterclaims were barred by the applicable statute of limitations. The trial court granted the motion, dismissing Appellants' counterclaims and ordering specific performance. Appellants appealed that order. This court held that the Dotsons did not, as a matter of law, show that Appellants' claims are barred by limitations but summary judgment was proper as to the fraud in the inducement claim because Snow ratified the lease with option to purchase. We dismissed for want of jurisdiction as to Faye Dotson because she lacked standing. Because Texas Probate Code Section 27 is inapplicable to this case, we reversed the trial court's summary judgment to the extent it was based on Dotson's claim pursuant to that statute. We remanded the case for further consideration in an opinion dated July 9, 2008. See Wells v. Dotson, 261 S.W.3d 275 (Tex. App.-Tyler 2008, no pet.).
Upon remand, Dotson filed a motion for partial summary judgment that resulted in an order dismissing Appellants' counterclaims for unjust enrichment, fraud, and statutory fraud, and their affirmative defenses of unjust enrichment, unconscionability, fraud, and statutory fraud. A few days later, Dotson filed his third motion for partial summary judgment urging dismissal of Appellants' remaining counterclaims and affirmative defenses. After receiving the motion and notice of the hearing by mail on June 7, 2010, Appellants filed an objection, complaining that the motion was untimely, and asked the court to reset the hearing. Dotson filed a motion to shorten the time for notice of hearing, which the trial court granted. A week later, the trial court granted Dotson's third motion for summary judgment.
The remaining issues were tried before the court on July 1, 2010. The court found that Dotson was entitled to specific performance of Section 11 of the lease, the option to purchase, and ordered Appellants to convey the remaining three tracts of land. The court ordered that the purchase price is $269,999.60, minus all rental payments made by the date of closing, attorney's fees, costs, and post-judgment interest. Additionally, the trial court made extensive findings of fact and conclusions of law. This appeal followed.
NOTICE OF HEARING
In their second issue, Appellants contend the trial court erred by overruling their objection to Dotson's late motion for partial summary judgment. In their third issue, Appellants contend the trial court erred by shortening the time for notice of the hearing on Dotson's third motion for partial summary judgment. They argue that they were entitled to twenty-four days' notice before the hearing.
A motion for summary judgment must be filed and served at least twenty-one days before the time specified for the hearing. TEX. R. CIV. P. 166a(c). However, when a motion for summary judgment and notice of the hearing are served by mail or by fax, they must be served at least twenty-four days before the hearing. TEX. R. CIV. P. 21a. The nonmovant's response must be filed not later than seven days prior to the date of the hearing. TEX. R. CIV. P. 166a(c). By requiring the nonmovant to file its response seven days before the hearing, Rule 166a presupposes that the nonmovant has had at least fourteen days to obtain and file summary judgment evidence to rebut the movant's evidence. City of Dallas v. Cont'l Airlines, Inc., 735 S.W.2d 496, 500 (Tex. App.-Dallas 1987, writ denied). The reason for the notice provision is to give the nonmovant a full opportunity to respond on the merits. See Stephens v. Turtle Creek Apartments, LTD., 875 S.W.2d 25, 26 (Tex. App.-Houston [14th Dist.] 1994, no writ). Nonetheless, Rule 166a provides that the trial court may allow filings even though they are not within the time requirements. City of Dallas, 735 S.W.2d at 500. If a party receives notice that is untimely, but sufficient to enable the party to attend the summary judgment hearing, the party must file a motion for continuance and/or raise the complaint of late notice in writing, supported by affidavit evidence, and raise the issue before the trial court during the summary judgment hearing. May v. Nacogdoches Mem'l Hosp., 61 S.W.3d 623, 626 (Tex. App.-Tyler 2001, no pet.). Further, the appellant must show that lack of sufficient notice in a summary judgment proceeding caused him harm. Cunningham v. Zurich Am Ins. Co., 352 S.W.3d 519, 531 (Tex. App.-Fort Worth 2011, pet. filed).
The docket sheet in this case reflects that, in April 2010, the case was set for jury selection on June 28, 2010. On June 7, 2010, Dotson filed his third motion for partial summary judgment and served Appellants by mail. The motion was set to be heard June 28. Under the rules, Appellants were entitled to twenty-four days from June 7. See TEX. R. CIV. P. 21a, 166a(c). Apparently realizing the error, Dotson, on June 18, filed a motion to shorten the time for notice of the hearing, asking the court to shorten the notice period to eighteen days and to extend Appellants' deadline for filing their response to June 24. Also on June 18, the court granted that motion, shortening the deadline to eighteen days, making the June 7 service of the third motion for partial summary judgment timely as to the June 28 hearing. The court also adjusted the requirement that the response be filed seven days before the hearing and allowed Appellants until June 24 to file a response. Appellants mailed their objection to the untimely motion to Dotson on June 17, but did not file the objection asking the court to reset the hearing on the motion until June 21. Appellants mailed their summary judgment response to Dotson on June 23 and filed it June 28. The court granted Dotson's third motion for partial summary judgment on June 25.
Appellants did not present affidavit evidence with their objection explaining why they needed more time to file their response. See May, 61 S.W.3d at 626. They have not explained, in the trial court, or in this court, how they were prejudiced by not having the full twenty-four days to respond. They have not identified any evidence that they were unable to present. And they served their response on Dotson one day before the deadline for doing so. We note also that Appellants had already been defending this case since October 2005. Appellants have not shown that they were harmed by receiving less than twenty-four days' notice. See Cunningham, 352 S.W.3d at 351. We overrule Appellants' second and third issues.
OBJECTIONS TO SUMMARY JUDGMENT EVIDENCE
In their fourth issue, Appellants contend the trial court abused its discretion by sustaining Dotson's objections to their summary judgment evidence. They argue the stricken testimony was based on personal knowledge, it was invited hearsay, and Dotson had ample opportunity to cross-examine each witness. Further, they argue, exclusion of the evidence was harmful. Applicable Law
Evidence offered either in support of or in opposition to a motion for summary judgment must be in admissible form to constitute competent summary judgment evidence. See TEX. R.CIV. P. 166a(f); United Blood Servs. v. Longoria, 938 S.W.2d 29, 30 (Tex. 1997). The decision to admit or exclude evidence is committed to the discretion of the trial court, and is reviewed for abuse of that discretion. See City of Brownsville v. Alvarado, 897 S.W.2d 750, 753 (Tex. 1995).
A judgment may not be reversed on appeal unless the error complained of probably caused the rendition of an improper judgment. TEX. R. APP. P. 44.1(a)(1); State v. Cent. Expressway Sign Assocs., 302 S.W.3d 866, 870 (Tex. 2009). In making this determination, the court must review the entire record. Cent. Expressway Sign Assocs., 302 S.W.3d at 870. The exclusion is likely harmless if the evidence was cumulative, or the rest of the evidence was so one-sided that the error likely made no difference in the judgment. Id. But if erroneously admitted evidence was crucial to a key issue, the error is likely harmful. Id. We must uphold the trial court's evidentiary ruling if there was any proper ground for the ruling, even a ground not urged at trial. Lively v. Blackwell, 51 S.W.3d 637, 641 (Tex. App.-Tyler 2001, pet. denied). Analysis
In support of their response to Dotson's third motion for partial summary judgment, Appellants offered portions of their own deposition testimony. Dotson objected to certain sentences in that testimony, including part of the testimony of Lonnie Keith Wells, Snow's grandson in which he stated that "[d]uring that period of time, my grandmother was really thankful for Buddy's participation." Then, counsel inquired as to where he got his "understanding of all of those facts" that he just testified to, and Wells stated that his grandmother told him. Thus, this testimony is hearsay and properly excluded. See TEX. R. EVID. 802; Youngstown Sheet & Tube Co. v. Penn, 363 S.W.2d 230, 233 (Tex. 1962).
The second complained-of quote by Wells is as follows: "You have to understand that she didn't do anything — Granddaddy was the one that handled all of the business, and so, she doesn't — she didn't know what she was doing." This testimony is conclusory, not shown to be based on personal knowledge, and therefore inadmissible. See TEX. R. EVID. 602; Paragon Gen.Contractors, Inc. v. Larco Constr., Inc., 227 S.W.3d 876, 883 (Tex. App.-Dallas 2007, no pet.); Patrick v. McGowan, 104 S.W.3d 219, 223 (Tex. App.-Texarkana 2003, no pet.).
Dotson objected to certain deposition testimony of Andria Medley Stewart, Snow's granddaughter. In the first instance, Dotson's attorney asked, "So, the first thing you're telling us is before December of 1993, she told you that she did not know how to take care of her property?" Stewart answered, "After Dolphus died, yes." This statement is inadmissible hearsay. See Penn, 363 S.W.2d at 233.
Dotson also objected to the following sentence by Stewart:
Like I said, she's 76 years old — 75, 76 years old, her husband had just died a year earlier that she was married to for 60 years that made all the decisions for her, kept up with all the money, kept up with all the property, kept up with everything, and now all of a sudden someone has come in and made promises to her and induced her trust into him — into him, and she just transferred her trust from her husband to Buddy Dotson.There is no testimony explaining the factual basis of this statement. It is not shown to be within the witness's personal knowledge, and it is conclusory. See Paragon Gen. Contractors, Inc., 227 S.W.3d at 883; Patrick, 104 S.W.3d at 223. Therefore, it is inadmissible. TEX. R. EVID. 602.
Dotson also objected to Stewart's statement that Snow "couldn't balance her checkbook." Appellants have not shown that Stewart had personal knowledge that Snow could not balance her checkbook. Thus, this statement is inadmissible. See TEX. R. EVID. 602.
Finally, Dotson objected to the following deposition testimony of Blanche Phillips, Snow's daughter:
And I said, well, she's in love with the man. That's the exact words I said. I said, it's not a sexual thing. It's like, here's finally a son or a grandson, a figure that's going to take care of her stuff and help her through her troubles and all this, and she's just — was elated to have him be there at one point in time.
. . . .
And I said because she's in love with him. I don't mean physically. I mean she's in love with him. She — her hopes just went — I mean, I think anything he asked her to sign she would have signed it, because I think she trusted him that much.
. . . .
And she just kind of adopted Buddy.
Again, Appellants have not shown that the witness had personal knowledge of the subject matter of the testimony, and the statements are conclusory. See Paragon Gen. Contractors, Inc., 227 S.W.3d at 883; Patrick, 104 S.W.3d at 223. Therefore, they are inadmissible. TEX. R. EVID. 602.
Further, Appellants assert that the errors in admitting the above testimony caused the rendition of an improper judgment. They claim that the trial court should have considered this evidence "in evaluating whether there was a fact issue as to whether Dotson owed a fiduciary duty to Mildred Snow." However, Appellants do not provide any further argument or discussion. They do not demonstrate that the summary judgment turns on a particular piece of evidence that was excluded or that the evidence excluded was controlling on a dispositive material issue. See Interstate Northborough P'ship v. State, 66 S.W.3d 213, 220 (Tex. 2001). Specifically, they do not show how this evidence raises a fact issue regarding the existence of a confidential relationship between Dotson and Snow, as would be necessary to defeat the summary judgment aimed at dismissing Appellants' counterclaim and affirmative defense of breach of fiduciary duty. Accordingly, any error in sustaining Dotson's objections to the evidence is harmless. See Cent. Expressway Sign Assocs., 302 S.W.3d at 870. We overrule Appellants' fourth issue.
THIRD MOTION FOR PARTIAL SUMMARY JUDGMENT
In their first issue, Appellants contend that the trial court erred by granting Dotson's third motion for partial summary judgment. They argue that they raised a fact issue on their counterclaims for breach of fiduciary duty and breach of contract and their affirmative defenses of prior material breach and failure of consideration. Standard of Review
We review the trial court's decision to grant summary judgment de novo. Tex. Mun. Power Agency v. Pub. Util. Comm'n, 253 S.W.3d 184, 192 (Tex. 2007). After adequate time for discovery, a party without the burden of proof at trial may move for summary judgment on the ground that there is no evidence of one or more essential elements of a claim or defense. TEX. R. CIV. P. 166a(i). Once a no evidence motion has been filed in accordance with Rule 166a(i), the burden shifts to the nonmovant to bring forth evidence that raises a fact issue on the challenged element. See Macias v. Fiesta Mart, Inc., 988 S.W.2d 316, 317 (Tex. App.-Houston [1st Dist.] 1999, no pet.). A no evidence summary judgment is essentially a pretrial directed verdict, which may be supported by evidence. Timpte Indus., Inc. v. Gish, 286 S.W.3d 306, 310 (Tex. 2009). An appellate court reviewing a no evidence summary judgment must consider whether reasonable and fair-minded jurors could differ in their conclusions in light of all of the evidence presented. Goodyear Tire & Rubber Co. v. Mayes, 236 S.W.3d 754, 755 (Tex. 2007) (per curiam).
Review of a summary judgment requires that the evidence presented by both the motion and the response be viewed in the light most favorable to the nonmovant, crediting evidence favorable to the nonmovant if reasonable jurors could and disregarding all contrary evidence and inferences unless reasonable jurors could not. Gish, 286 S.W.3d at 310; Wal-Mart Stores, Inc. v. Rodriquez, 92 S.W.3d 502, 506 (Tex. 2002). Evidence that favors the movant's position will not be considered unless it is uncontroverted. Great Am. Reserve Ins. Co. v. San Antonio Plumbing Supply Co., 391 S.W.2d 41, 47 (Tex. 1965). When a party moves for both a no evidence and a traditional summary judgment, we first review the trial court's summary judgment under the no evidence standard of Rule 166a(i). Ford Motor Co. v. Ridgway, 135 S.W.3d 598, 600 (Tex. 2004). Breach of Fiduciary Duty
Dotson moved for a no evidence summary judgment on Appellants' counterclaim for breach of fiduciary duty, arguing that there is no evidence of a fiduciary relationship between him and Snow. Appellants argue that an informal fiduciary relationship existed between the two.
The term "fiduciary" refers to a person owing a duty of integrity and fidelity, and it applies to any person who occupies a position of peculiar confidence towards another. Lee v. Hasson, 286 S.W.3d 1, 14 (Tex. App.-Houston [14th Dist.] 2007, pet. denied). Informal fiduciary relationships have been termed "confidential relationships" and may arise where one person trusts in and relies upon another, whether the relation is a moral, social, domestic, or merely personal one. Fitz-Gerald v. Hull, 237 S.W.2d 256, 261 (1951). The confidential relationship exists where, because of family relationship or otherwise, one party is in fact accustomed to being guided by the judgment or advice of the other or is justified in placing confidence in the belief that the other will act in his interest. See Thigpen v. Locke, 363 S.W.2d 247, 253 (Tex. 1962). Mere subjective trust alone is not enough to transform arm's length dealing into a fiduciary relationship. Id. To impose an informal fiduciary duty in a business transaction, the special relationship of trust and confidence must exist prior to, and apart from, the agreement made the basis of the suit. Meyer v. Cathey, 167 S.W.3d 327, 331 (Tex. 2005) (per curiam). The existence of a confidential relationship is usually a question of fact, but when the issue is one of no evidence, it becomes a question of law. Thigpen, 363 S.W.2d at 253.
Dotson and Snow had known each other since the late 1980s or early 1990s, when Dotson first orally contracted to lease land from Snow's husband, Dolphus. Dotson stopped by the Snows' and visited with them once every week or two. Dotson testified that he was not aware of the Snows' financial situation. After Dolphus had a stroke, Dotson came over daily and helped with his rehabilitation. After Dolphus died, in 1992, Dotson checked on Snow, initially on a daily basis, then once every couple of days, then once a week. Eventually, his visits were not as frequent. He testified that, in his opinion, Snow trusted him. He and Snow hired an attorney to draft the lease, each paying half of the attorney's fees. They met with the attorney together, and the attorney explained the terms of the lease to Snow.
Dotson's wife testified that she had known Snow all her life and had visited her from time to time. She explained that Dotson would wrap the pipes outside Snow's house in the winter, or do "some little something that needed to be done" if Snow asked him to. But he did not actually go over there and take care of her place.
Wells testified that he believed Snow wanted Dotson to have the lease. Stewart testified that, about eighteen months after the lease was signed, she explained to Snow that, under the terms of the lease, Snow could not break it and she had to sell the property to Dotson for $900.00 an acre. Stewart explained that, even though the terms of the lease were not favorable to Snow, Snow refused to go back on her word. Stewart further testified that, after Dolphus died, and after Snow's strokes, they noticed differences in Snow's ability to converse. Stewart also said that Snow "found money that she didn't know what to do with, she was concerned about her property because she couldn't take care of it, that Dolphus always kept it immaculate." In unobjected-to testimony, Stewart said Snow told her that Dotson told Snow that he would take care of everything and she did not have to worry about anything. Stewart understood that Dotson was supposed to maintain all of the property under the lease as well as the seventy acres where Snow lived. In response to Stewart's inquiry as to why Snow signed the lease, Snow said she trusted Dotson. Stewart testified that Snow was probably not competent to sign her 2003 will because she would sign anything that anybody she trusted put in front of her.
Phillips testified that she attended the meeting with the attorney when Snow and Dotson signed the lease. At the time, Phillips told the attorney she would not sign as a witness because she thought "Mr. Dotson is taking her to the cleaners." Snow had no son, and Phillips explained that Snow had given up on the idea that her only grandson, Keith, would take care of her and her "place."
Harold Lewis, the executor of Snow's estate, testified that he had seen nothing to lead him to believe that Dotson had engaged in a scheme to get close to Snow and to defraud her of her property. Lewis believed Snow to be competent when she signed the lease. He believed that Snow wanted to execute the lease. Lewis agreed with the attorney that Dotson had tried to do the best he could with Snow, and Lewis did not know of anything indicating that Dotson "snookered" Snow.
Sterling, Snow's granddaughter, testified that, even though Snow eventually knew Dotson may have taken advantage of her, Snow felt obligated to honor the contract. She asserted that she believes Dotson created a false friendship with Snow for the sole purpose of gaining her trust so that he could take undue advantage of her.
It appears that Snow needed someone to help her. In the absence of family members willing and able to provide the guidance she needed, she was left to fend for herself. But the evidence of her resulting relationship with Dotson does not show that it rose to the level of a fiduciary one.
Dotson testified without explanation that Snow trusted him. Stewart testified that Snow trusted Dotson. But even overlooking the conclusory nature of the statement, mere subjective trust, without more, is insufficient to transform an arm's length transaction into a fiduciary relationship. Crim Truck & Tractor Co. v. Navistar Int'l Transp. Corp., 823 S.W.2d 591, 595 (Tex. 1992). While it is evident that there was a friendly, neighborly business relationship between Snow and Dotson, none of this testimony amounts to a showing that Snow relied on Dotson for moral, financial, or personal support or guidance. A longstanding relationship of friendship or cordiality is insufficient, without more, to establish an informal fiduciary relationship. Lee, 286 S.W.3d at 15.
Dotson testified that he was not aware of the Snows' financial situation. There is no evidence that Dotson had been advising Snow in her financial, business, or personal matters. There is no evidence that Dotson did or said anything to lead Snow to believe he would place his own interests above hers in their business transaction. And clearly he did not. It appears that the only time Snow placed confidence in Dotson was when she signed the lease in question. To impose an informal fiduciary duty in a business transaction, the special relationship of trust and confidence must exist prior to, and apart from, the agreement made the basis of the suit. Meyer, 167 S.W.3d at 331.
We cannot justify imposing a fiduciary duty based on the fact that, for years Dotson rented land from Snow's husband or that Dotson helped Snow's husband with rehabilitation after his stroke, or that he checked on Snow after her husband died. There is no evidence that Snow was justified in believing that Dotson would act in her best interest. Lee, 286 S.W.3d at 14. Appellants have presented no evidence raising a fact question about the existence of a fiduciary relationship between Snow and Dotson. Therefore, the summary judgment in favor of Dotson was appropriate on Appellants' counterclaim for breach of fiduciary duty. See TEX. R. CIV. P. 166a(i). Breach of Contract
Dotson moved for a no evidence summary judgment on Appellants' counterclaim for breach of contract, asserting there is no evidence that he breached any term of the lease or that Appellants were damaged. Appellants argue that Dotson breached the lease by using the property for purposes other than agriculture and that he failed to maintain the premises as required by the lease.
The essential elements of a breach of contract claim are (1) the existence of a valid contract, (2) performance or tendered performance by the plaintiff, (3) breach of the contract by the defendant, and (4) damages sustained by the plaintiff as a result of the breach. Valero Mktg. & Supply Co. v. Kalama Int'l, 51 S.W.3d 345, 351 (Tex. App.-Houston [1st Dist.] 2001, no pet.). A breach of a contract is a failure to perform any promise that forms a whole or a part of a contract. See BLACK'S LAW DICTIONARY 200 (8th ed. 2007). A breach may occur where a party fails to perform in accordance with the stipulations of the contract. Dorsett v. Cross, 106 S.W.3d 213, 217 (Tex. App.-Houston [1st Dist.] 2003, pet. denied). A breach is determined by comparing a contract's terms with the actions of the alleged breaching party. Enron Oil & Gas Co. v. Joffrion, 116 S.W.3d 215, 221 (Tex. App.-Tyler 2003, no pet.).
Use of Property
In its opening paragraph, the lease provides that Snow "demises and lets to" Dotson, the described property "to occupy and use for agricultural purposes, including but not limited to, grazing, and for no other purpose." Appellants assert that Dotson used the property for entertainment, inviting friends to the property for social activities, which has included discharging firearms at a metal target in the shape of a deer. Additionally, they contend he sold equipment, including a truck, on the property.
Sterling testified that target practice had been taking place on the property. She saw a "deer" laying flat on the ground and a nearby wench and assumed he had been hunting deer and used the wench to clean it.
Dotson explained that he made a metal deer silhouette to use for target practice. He had shot at it for entertainment and a lot of his friends have also shot at the target. He denied hunting deer on the property or letting others hunt on the property. He explained that he has a hoist that he uses to lift a diesel tank in and out of the back of a pickup truck to take fuel to tractors out in the field. Finally, he explained that when his truck became inoperable, he decided to leave it on the property to sell it, rather than tow it off. He did not think the truck had any bearing on the way the land looked, but by selling it and getting it off the property, he was maintaining the property.
Dotson argues that he never testified that he shot the deer target on the leased property. However, he answered "yes" when asked, "And that's located on the property that you're currently leasing; is that correct?" Then he explained, "There's been a lot of people in there when we've shot this." The implication is that he and his friends shot the target while on the leased property. While seemingly insignificant, the evidence that he sold his truck from this property and entertained himself and others with target practice on the property is some evidence that he used the property for a use other than agricultural. Therefore, it was error for the trial court to grant Dotson's third motion for partial summary judgment on Appellants' breach of contract counterclaim. However, this does not end our inquiry.
A trial court's erroneous decision to grant summary judgment can be rendered harmless by subsequent events in the trial court. Progressive Cnty. Mut. Ins. Co. v. Boyd, 177 S.W.3d 919, 921 (Tex. 2005). Here, after the trial court granted Dotson's summary judgment motion disposing of Appellants' counterclaims and affirmative defenses, a trial before the court was held on Dotson's claim for specific performance. In its findings of fact, the trial court found that Dotson never breached any material term of the lease, neither Dotson nor anyone else ever shot at the metal deer on the property, and that Dotson's placing the truck near the road in order to sell it was in compliance with the lease's requirement that the property be used for agricultural purposes. In its conclusions of law, the court concluded that Dotson is entitled to specific performance of the option to purchase contained in the lease. The court's second amended final judgment ordered Appellants to execute the contract of sale pursuant to the terms of the lease. Appellants have not attacked the order of specific performance. Because Appellants' breach of contract counterclaim was fully litigated, any error in granting the motion for partial summary judgment on this claim is harmless. See id.
Maintenance of Property
Section 2 of the lease provides that
Lessee agrees to keep fences and other improvements on the premises in as good repair and condition as they are at the commencement of the primary term of this Lease With Options To Purchase and Lessee shall not cut trees, except with written permission of the Lessor, but shall use only dead or down timber.
Stewart testified that the fences were not maintained in the same manner that Dolphus maintained them. She also admitted that she had not been on the property for three years before Dolphus died and did not know what condition the fences were in when Dolphus died. Further, the lease was signed in December 1993, but Dolphus died in 1992. She said the fence row is not currently mowed and there are trees growing up through it, something she considers a violation of the lease. Harold Lewis testified that Dotson has maintained the property like he should have, including keeping the fences in repair. He explained that children who live nearby have been riding four wheelers on the property, causing ruts. Dotson put locks on the gate to keep them out. Lewis said the fences were maintained as well as possible and that Dotson installed some new fences, although they were not maintained as well as Dolphus had maintained them. While Dotson allowed the fence row to grow up some, there was no broken barbed wire that needed repairing. Sterling testified that some cross-fences were lying down and there were fences on the portion of Snow's property where she lived that were in disrepair. She said the fences "continuously deteriorated after Dolphus died, because he kept the property in just perfect working order." She said Dolphus kept everything immaculate and Dotson should not be allowed to exercise the option to purchase because he has not maintained the property to the level that Snow understood it should be maintained.
Dotson explained that he built fences, cleaned fences, cross-fenced, cleaned out ponds, filled in washes, poisoned gophers, sprayed for weeds, planted grass, put out lime and fertilizer, plowed, burned brush, sprigged coastal, and baled hay. He also mowed the property. He did much of the work himself, but he also hired help. Dotson also opined that, while Dolphus mowed well, he did not maintain the fences well. He also stated that Snow never mentioned maintenance to him.
There is no evidence describing the precise condition of the fences or other improvements on the property at the time the lease was signed, making comparisons impossible. There is evidence that Dotson kept the fences in good repair. Evidence showing that Dolphus kept the fence rows neatly mowed while Dotson did not does not translate into evidence that Dotson did not maintain the fences themselves. There is evidence that Dotson, not Dolphus, built the cross-fences, and maintenance of those fences should not be included in the lease's mandate. Likewise, the lease did not apply to the fences on the property where Snow lived. There is no evidence that Dotson breached the contract by failing to maintain the fences and other improvements on the leased property. See TEX. R. CIV. P. 166a(i). Further, we conclude the trial court properly determined that Appellants failed to raise a fact question on the issue of maintenance of the fences and improvements. See Macias, 988 S.W.2d at 317. The trial court did not err in granting Dotson's third motion for partial summary judgment on Appellants' breach of contract counterclaim based on failure to maintain the fences and improvements. Affirmative Defenses
Dotson moved for a no evidence summary judgment on Appellants' affirmative defenses of excuse due to prior material breach and failure of consideration. Stating that failure of consideration is functionally identical to prior material breach, he argued that there is no evidence that he breached any term of the lease or that any such breach was material. Additionally, Dotson moved for a traditional summary judgment on Appellants' affirmative defenses of excuse due to prior material breach and failure of consideration because Appellants elected to treat the contract as continuing and continued to demand and accept performance by Dotson.
As we explained above, Appellants raised a fact issue as to whether Dotson breached the contract by using the property for purposes other than agricultural. Appellants asserted that the same acts that constitute a breach of contract also constitute their affirmative defense of failure of consideration. We must now determine if the breach was a material one. In determining the nature of an alleged failure of consideration, or material breach, courts will consider, among other things, the extent to which the nonbreaching party is deprived of the benefit that it could have reasonably anticipated from full performance. Mustang Pipeline Co. v. Driver Pipeline Co., 134 S.W.3d 195, 199 (Tex. 2004) (per curiam). The less the nonbreaching party is deprived of the expected benefit, the less substantial the failure of consideration. See Hernandez v. Gulf Grp. Lloyds, 875 S.W.2d 691, 693 (Tex. 1994).
The focus of the lease was to allow Dotson to occupy the land for agricultural purposes and for Snow, or her estate, to receive rental payments and to forego the responsibility of paying ad valorem taxes. These terms were in no way affected by Dotson's act of shooting at a metal target, allowing his friends to shoot at the target, and selling one inoperable vehicle from the premises. The complained-of acts do not interfere with Dotson's continued occupation of the land for agricultural purposes or his payment of rent and taxes. Appellants did not raise a fact issue on materiality of the breach. See Macias, 988 S.W.2d at 317.
The trial court did not err in granting Dotson's no evidence motion for partial summary judgment on Appellants' affirmative defenses of excuse due to prior material breach and failure of consideration. See id. We need not reach Appellants' arguments regarding Dotson's traditional motion for partial summary judgment. See Ridgway, 135 S.W.3d at 600. We overrule Appellants' first issue.
ATTORNEY'S FEES
In their sixth issue, Appellants assert that the evidence does not support the award of attorney's fees. Appellants argue that Dotson failed to prove he was entitled to attorney's fees pursuant to Texas Civil Practice and Remedies Code Section 38.001 because he did not prove that the claim was presented to Appellants. They also argue that Dotson failed to prove that all of his $53,606.00 in attorney's fees were incurred on claims for which attorney's fees are recoverable. They contend that Dotson is not permitted to recover attorney's fees for defending against a suit for breach of fiduciary duty, fraud, fraudulent inducement, statutory fraud, and unjust enrichment. Further, they assert, Dotson is not entitled to attorney's fees for pursuing his cause of action for specific performance pursuant to Texas Probate Code Section 27, which has been previously disposed of on appeal. Finally, Appellants assert that the trial court erred in awarding appellate attorney's fees because Dotson failed to prove that the amounts awarded relate to claims for which attorney's fees are allowable. Applicable Law
Trial courts have no inherent authority to require a losing party to pay the prevailing party's attorney's fees. Tony Gullo Motors I, L.P. v. Chapa, 212 S.W.3d 299, 311 (Tex. 2006). Texas law does not allow recovery of attorney's fees unless authorized by statute or contract. Id. at 310. The legislature has provided that a party who prevails on a breach of contract claim may recover reasonable attorney's fees for prosecution of that claim. TEX. CIV. PRAC. & REM. CODE ANN. § 38.001(8) (West 2008). Presentment
Appellants assert that Dotson is not entitled to attorney's fees because he did not prove that the claim was presented to them as required by statute. One prerequisite to recovering attorney's fees under Chapter 38 of the Texas Civil Practice and Remedies Code is presentment of the underlying claim to the opposing party or its agent. TEX. CIV. PRAC. & REM. CODE ANN. § 38.002(2) (West 2008). The purpose of the presentment requirement is to allow the person against whom the claim is asserted an opportunity to pay a claim within thirty days of receiving notice of the claim without incurring an obligation for attorney's fees. See Jones v. Kelley, 614 S.W.2d 95, 100 (Tex. 1981). Presentment requires no particular form; all that is necessary is an assertion of a debt or claim, a request for payment, and the opposing party's refusal to pay. Id.
In a letter to Snow's estate's attorney, responding to an earlier letter from the estate's attorney to Harold Lewis, Appellants' attorney explained that Appellants are opposed to the transfer of the property and intend to fight it. The record also includes a letter from Dotson's attorney to the attorney for the estate indicating Dotson's intent to exercise the option to purchase included in the lease. Accordingly, Dotson presented his claim to the estate, and the heirs refused to move forward with the sale. Furthermore, Dotson asserted in his petition that he had complied with and performed all conditions precedent to his right to recover against Appellants. Having done so, Dotson is required to prove only those conditions precedent that have specifically been denied by Appellants. TEX. R. CIV. P. 54; Shin-Con Dev. Corp. v. I.P.Invs., Ltd., 270 S.W3d 759, 768 (Tex. App.-Dallas 2008, pet. denied). Appellants did not specifically deny that Dotson had failed to present his claim as required by Section 38.002(2). Consequently, Dotson was not required to prove presentment. See Greathouse v. Charter Nat'l Bank-Southwest, 851 S.W.2d 173, 177 (Tex. 1992). Counterclaims
Appellants assert that Dotson cannot recover attorney's fees for defending against their counterclaims. They argue that Dotson's attorney's testimony that twenty percent of the time spent in this case was in defense of Appellants' counterclaims requires a twenty percent reduction in the fees awarded.
If any attorney's fees relate solely to a claim for which such fees are unrecoverable, a claimant must segregate recoverable from unrecoverable fees. Tony Gullo Motors I, L.P., 212 S.W.3d at 313. However, when discrete legal services advance both a recoverable and unrecoverable claim, they are considered so intertwined that they need not be segregated. Id. at 313-14. Segregation is not required to overcome affirmative defenses to a breach of contract claim. Id.at 314. Similarly, when a defendant asserts a counterclaim that the plaintiff must overcome in order to fully recover on its contract claim, the attorney's fees necessary to defeat the counterclaim are likewise recoverable. See Varner v. Cardenas, 218 S.W.3d 68, 69 (Tex. 2007) (per curiam).
Here, Dotson's attorney's efforts in defending against Appellants' counterclaims were as necessary as his efforts in pursuing Dotson's claim for breach of contract and specific performance. Dotson had to prove that he complied with the lease and that Appellants did not. In doing so, he had to address and disprove all of Appellants' counterclaims and affirmative defenses in order to win on his breach of contract claim. Thus, the legal services provided advanced both Dotson's claim against Appellants and his defenses to their claims. Therefore, attorney's fees associated with defending against Appellants' counterclaims are recoverable and the award should not be diminished by twenty percent. See id.First Amended Motion for Summary Judgment and Appeal
Appellants assert that Dotson is not entitled to attorney's fees incurred in pursuing his first amended motion for summary judgment. Ruling on that motion in 2007, the trial court granted judgment for Dotson on his claim for specific performance pursuant to Texas Probate Code Section 27 and dismissed Appellants' counterclaims on the basis of limitations. On appeal, this court held that Section 27 was not applicable and rendered judgment that Dotson take nothing on his Section 27 claim. See Wells, 261 S.W.3d at 280. We also held that Dotson did not prove as a matter of law that Appellants' counterclaims are barred by limitations. Id. at 281. However, we held that Appellants' counterclaim of fraud in the inducement is barred by ratification. Id. at 283.
Again, although Dotson was not ultimately successful on his Section 27 claim, his attorney's legal services advanced his claim and his defenses to Appellants' counterclaims and affirmative defenses. While a party is not normally allowed attorney's fees when he loses, here, Dotson's attorney's discrete legal services advanced both recoverable and unrecoverable fees. See Tony Gullo Motors I, L.P., 212 S.W.3d at 313-14. Further, segregation based on separate theories of the same cause of action is not required. Solar Soccer Club v. Prince of Peace Lutheran Church, 234 S.W.3d 814, 829 n.2 (Tex. App.-Dallas 2007, pet. denied). Had Dotson tried his case on both theories at one time, he would not have been required to segregate the work done in pursuit of the Section 27 theory of specific performance. Thus, Dotson is entitled to attorney's fees incurred in pursuing his first amended motion for summary judgment. Appellate Attorney's Fees
Without citation to authority, Appellants contend the trial court erred in awarding $12,500.00 in attorney's fees to Dotson if he prevails in this appeal and an additional $10,000.00 in attorney's fees if he prevails in an appeal to the Texas Supreme Court. Appellants argue that Dotson failed to offer any proof that these amounts relate to the claims for which attorney's fees are allowed.
Texas law provides that a party entitled to recover attorney's fees at trial is also entitled to recover them for successfully defending the case on appeal. See Wright v. Wright, 280 S.W.3d 901, 915-16 (Tex. App.-Eastland 2009, no pet.). As explained above, the discrete legal services provided by Dotson's attorneys advanced his claim against Appellants as well as his defenses to their claims. This is also true of the appeals. Accordingly, the trial court did not err in awarding attorney's fees for the appeals. We overrule Appellants' sixth issue.
CONCLUSION
The trial court did not err in overruling Appellants' objection to Dotson's late motion for partial summary judgment or by shortening the time for notice of the hearing on that motion. The trial court did not err by sustaining Dotson's objections to Appellants' summary judgment evidence or awarding attorney's fees to Dotson. The trial court's erroneous decision to grant Dotson's third motion for partial summary judgment was harmless. We need not reach Appellants' fifth issue. See TEX. R. APP. R. 47.1.
We affirm the trial court's judgment.
BRIAN HOYLE
Justice
Panel consisted of Worthen, C.J., Griffith, J., and Hoyle, J.
(PUBLISH)
NO. 12-11-00055-CV
IN THE ESTATE OF MILDRED SNOW, DECEASED
Appeal from the County Court at Law
of Cherokee County, Texas. (Tr.Ct.No. P7809)
THIS CAUSE came to be heard on the oral arguments, appellate record and briefs filed herein, and the same being considered, it is the opinion of this court that there was no error in the judgment.
It is therefore ORDERED, ADJUDGED and DECREED that the judgment of the court below be in all things affirmed, and that all costs of this appeal are hereby adjudged against the appellants, KEITH WELLS, ANDRIA MEDLEY STEWART, BLANCHE PHILLIPS, AND CARRIE STERLING, for which execution may issue, and that this decision be certified to the court below for observance.
Brian Hoyle, Justice.
Panel consisted of Worthen, C.J., Griffith, J., and Hoyle, J.