Cody Texas, L.P. v. BPL Exploration, Ltd.
513 S.W.3d 522
| Tex. App. | 2016Background
- BPL sued Cody Texas (and others) in 2005 alleging breach of a JOA preferential-purchase provision and fraud based on transfers occurring in 2000; bench trial occurred in 2009.
- Trial court signed a final judgment on May 31, 2013; the district clerk entered it on the docket June 6, 2013 but failed to send notice to counsel.
- Cody Texas did not learn of the May 31 judgment until October 9, 2013 when the court signed a later judgment; its subsequent appeal was dismissed as untimely because the October 9 judgment was void.
- Cody Texas filed a bill of review claiming (1) it lacked notice of the May 31 judgment due to clerk error (an official mistake) and (2) it had a meritorious appellate ground: BPL’s causes of action (breach and fraud) were time-barred.
- The trial court granted BPL’s summary judgment denying the bill of review and denied Cody Texas’s cross-motion; the appellate court reviews cross-motions de novo.
Issues
| Issue | Plaintiff's Argument (Cody Texas) | Defendant's Argument (BPL) | Held |
|---|---|---|---|
| Whether Cody Texas has a meritorious ground of appeal based on statute-of-limitations bar to BPL’s breach and fraud claims | BPL’s breach and fraud claims accrued in June 2000 and thus were barred by the 4-year limitations period when suit was filed in Nov. 2005 | Limitations were tolled or deferred: discovery rule for breach; fraudulent concealment for fraud (BPL learned key facts only during discovery) | Held for Cody Texas: undisputed facts show accrual in June 2000; neither discovery rule nor fraudulent concealment applies, so claims were time-barred (meritorious ground established) |
| Whether Cody Texas’s failure to timely appeal was due to its own negligence (precluding bill of review) | Cody Texas had no notice because the district clerk failed to give required notice; any counsel inquiries before plenary power expired were reasonable | Counsel was negligent for contacting the court coordinator rather than the district clerk and failed to discover the judgment earlier | Held for Cody Texas: clerk’s official mistake deprived it of notice; BPL failed to show Cody Texas’s conduct was negligent in a way that contributed to the missed appeal |
| Whether the discovery rule applies to a breach of contract based on alleged non‑disclosure under a JOA | Discovery rule not applicable because the facts giving rise to the breach were not inherently undiscoverable and BPL knew enough in June 2000 to investigate | Discovery rule applies because full terms (backdating, allocations) were not disclosed until later and were revealed only in litigation discovery | Held: discovery rule is a narrow exception and does not apply here; BPL knew or should have known in June 2000 |
| Whether fraudulent concealment tolled fraud claim based on incomplete notice from Choctaw | No equitable tolling: Choctaw gave notice and refused additional info; that refusal did not fraudulently conceal the existence of a cause of action | Fraudulent concealment tolls limitations because defendants actively hid key facts and documents | Held: fraudulent concealment not shown as a matter of law; BPL could have investigated public records and did not reasonably rely to toll limitations |
Key Cases Cited
- Cathey v. Booth, 900 S.W.2d 339 (Tex. 1995) (summary judgment burdens)
- Computer Associates Intern., Inc. v. Altai, Inc., 918 S.W.2d 453 (Tex. 1996) (discovery rule principles)
- S.V. v. R.V., 933 S.W.2d 1 (Tex. 1996) (inherently undiscoverable and objectively verifiable tests)
- Via Net v. TIG Ins. Co., 211 S.W.3d 310 (Tex. 2006) (narrow application of discovery rule to contract claims)
- Shell Oil Co. v. Ross, 356 S.W.3d 924 (Tex. 2011) (fraudulent concealment tolling standard)
- Petro–Chem. Transp., Inc. v. Carroll, 514 S.W.2d 240 (Tex. 1974) (bill of review elements)
- Borderlon v. Peck, 661 S.W.2d 907 (Tex. 1983) (fraudulent concealment and estoppel)