Bandier Realty Partners, LLC and Switchback Ventures, LLC v. SSC Opportunity Partners, LLC
01-13-00782-CV
| Tex. App. | Apr 2, 2015Background
- Dispute arises from a 190-acre La Porte, Texas property dispute and a mediated settlement (MSA) releasing claims in exchange for NPH's purchase option.
- MSA required Westergren to release all claims and lis pendens; NPH agreed to purchase the property.
- Westergren signed the release without reading it, claiming he was in a hurry and relied on Plank's representations.
- Jury findings included an oral contract promising $1 million and alleged fraudulent inducement by Plank; trial court entered a take-nothing judgment against Westergren on some claims.
- Court of Appeals affirmed in part; Texas Supreme Court reversed in part, reinstating take-nothing on certain claims and holding the release did not justify dual relief or provide a covenant not to sue.
- Court held Westergren could not justify reliance, and the partial performance exception to the statute of frauds did not apply.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Justifiable reliance on Plank's statements | Westergren relied on Plank's assurances due to hurried signing | Release language and opportunity to read negate justifiable reliance | Not justifiable reliance |
| Statute of frauds and partial performance | Partial payment of $500,000 supports enforceability of oral contract | No unequivocal referability of payment to oral contract; release not actionable | Partial performance exception not satisfied; contract unenforceable |
| Scope and effect of the release | Release intended to extinguish all claims including oral contract | Release not a covenant not to sue; does not bar future suits | Release not binding to extinguish oral-contract claims; no covenant not to sue implied |
| Overall disposition of claims | Westergren entitled to remedies for breach of oral contract and fees | MSA and release foreclose those remedies | Reverse in part; reinstate take-nothing on oral-contract and fees; affirm other judgments |
Key Cases Cited
- Thigpen v. Locke, 363 S.W.2d 247 (Tex. 1962) (reasonable care required to protect own interests in contracts)
- Poe, 115 S.W.2d 591 (Tex. 1938) (presence of opportunity to read contract matters to reading obligation)
- Chevalier v. Lane’s, Inc., 213 S.W.2d 530 (Tex. 1948) (partial performance and contract formation under statute of frauds)
- In re Int’l Profit Assocs., 274 S.W.3d 672 (Tex. 2009) (fraud claims and reliance standards in equitable contexts)
- Schlumberger Tech. Corp. v. Swanson, 959 S.W.2d 171 (Tex. 1997) (clear and unequivocal conduct in contract interpretation)
- Dresser Indus., Inc. v. Page Petroleum, Inc., 853 S.W.2d 505 (Tex. 1993) (general contract-readiness and voluntary signing principles)