Anderton v. Cawley
378 S.W.3d 38
Tex. App.2012Background
- Two partnerships, Cascades Ltd. and Bellwood Ltd., were formed to develop land near Tyler, Texas.
- Anderton and Cawley were the managing partners; Cascade Properties GP Corp. initially managed Cascades Ltd. and Bellwood Ltd.
- Cawley sought loans from Park Cities Bank and later from an entity controlled by him, with Anderton’s consent, triggering related defaults.
- BOT Real Estate, LLC foreclosed on Bellwood Ltd. after BOT acquired the debt from the Bank, following a March–June 2009 sequence involving tax payments and default notices.
- Anderton alleged mismanagement and fiduciary breaches by Cawley/Cawley-Cascade that destroyed the value of his partnership interests; BOT pursued a guaranty claim against Anderton.
- The trial court granted summary judgments largely in BOT’s favor and against Anderton on other claims; the court also canceled lis pendens; the court’s rulings were appealed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether BOT’s summary judgment on its guaranty claim was proper | Anderton contends a fact issue exists whether Bellwood was in default when BOT foreclosed | BOT argues Bellwood was in default as of June 30, 2009 due to unpaid 2008 taxes | No error: genuine issue on whether default existed at foreclosure |
| Whether there is a fact issue on breach of fiduciary duty by Cawley/Cawley-Cascade | Anderton and affiliates raised a genuine issue that Cawley breached duties by causing default and foreclosing for his benefit | Cawley/Cawley-Cascade argue no breach; rely on safe-harbor provisions and lack of damages | Yes: trial court erred; breach is a fact issue requiring remand |
| Whether plaintiffs stated a prima facie case for aiding and abetting fiduciary breach and for constructive trust | Evidence shows others aided Cawley/Cawley-Cascade and that a constructive trust may exist | Movants claim lack of evidence of breach and damages; rely on settled defenses | Yes: no-evidence judgments improper; remand for these claims |
| Whether the trial court erred by granting Hiles summary judgment on aiding and abetting fiduciary duty | Hiles’s liability depends on prior fiduciary breaches by Cawley/Cawley-Cascade | If fiduciary claims against Cawley/Cawley-Cascade fail, Hiles should have also prevailed | Yes: since fiduciary claims against Cawley/Cawley-Cascade survive, Hiles’s SJ was improper |
| Whether other traditional and no-evidence grounds support summary judgment against fiduciary-duty claims | There are genuine issues on breach, disclosure, and conflict of interest | Defendants seek dismissal on various grounds including statute of frauds and parol evidence | Partially reversed: fiduciary-duty-related claims survive; other grounds rejected |
Key Cases Cited
- Kunz v. Huddleston, 546 S.W.2d 685 (Tex.Civ.App.-El Paso 1977) (breach of fiduciary duty via self-dealing foreclosures approved)
- Lavender v. Bunch, 216 S.W.3d 548 (Tex.App.-Texarkana 2007) (owner’s rights when third-party purchases debt; relevance to cure of default)
- Shanks v. First State Bank of Coahoma, 70 S.W.2d 444 (Tex.Civ.App.-Eastland 1934) (payment by a third party presumed to be a purchase unless intention to discharge shown)
- Tri v. J.T.T., 162 S.W.3d 552 (Tex. 2005) (civil conspiracy elements and meeting of minds)