D & R Constructors, Inc., Michael Rushing, Stephanie Rushing, Penn Rushing and Florence Rushing v. Texas Gulf Energy, Inc., CS Bankers V, LLC, Texas Gulf Fabricators, LLC, Timothy Connolly, Brian G. Hendry, and Lester H. Smith
01-15-00604-CV
| Tex. App. | Oct 5, 2015Background
- D&R Constructors (Rushing family) entered a July 11, 2012 business arrangement with Texas Gulf Energy (TGE) and affiliates (CS Bankers V, LLC (CSB) and Texas Gulf Fabricators (TGF)) involving a Binding Letter of Intent (BLOI), a lease, and transfer/assumption of a bank note; the parties dispute whether a final contract was ever completed.
- Appellants allege TGE/CSB took possession of D&R’s fabrication facility and equipment, then CSB quickly foreclosed; Appellants claim the foreclosure notice was defective and that TGE personnel intercepted/refused delivery of the certified foreclosure notice.
- Appellants brought counterclaims including wrongful/intentional foreclosure, quiet title, fraud, conversion, breach of fiduciary duty, negligent misrepresentation, conspiracy, tortious interference, quantum meruit, promissory estoppel, and sought damages and return of property.
- The trial court granted multiple partial and final summary judgments in favor of plaintiffs (TGE/CSB/TGF and related parties), entered sanctions against Appellants and awarded attorneys’ fees; there was no trial on the merits.
- Appellants argue (1) the posted notice of trustee sale was legally defective (no sale time; missing attachments; incorrect identification of creditor), (2) Appellees actively blocked delivery of notice, (3) there were disputed fact issues across contract, tort, and equitable claims, and (4) the court erred by granting summary judgment while discovery disputes remained and by awarding non‑segregated attorneys’ fees and sanctions.
Issues
| Issue | Plaintiff's Argument (Appellees) | Defendant's Argument (Appellants) | Held (trial court) |
|---|---|---|---|
| Validity of foreclosure notice and right to foreclose | Foreclosure was proper and notice adequate under Property Code | Notice was defective on its face (no sale time, missing attachment, wrong corporate ID), and delivery was blocked by Appellees; therefore sale must be set aside | Trial court granted partial summary judgment upholding foreclosure by CSB |
| Quiet title to property | Title transferred by lawful foreclosure and belongs to purchasers (TGF/others) | Quiet title must follow foreclosure ruling; if foreclosure improper, title should be quieted back to D&R | Trial court entered final judgments dismissing Appellants’ quiet title claims |
| Contractual & equitable remedies (BLOI, breach, quantum meruit, promissory estoppel) | BLOI not an enforceable definitive contract; no evidence supports various tort/contract claims | BLOI and related communications created at least fact issues as to contract, and alternatively quantum meruit/promissory estoppel apply; summary judgment premature | Trial court granted no‑evidence and traditional summary judgment dismissing many claims including fraud, breach, quantum meruit |
| Sanctions and attorneys’ fees | Plaintiffs sought sanctions and fees for frivolous claims and prevailed | Appellants contend conspiracy allegation against a purported "puppet master" was a good‑faith extension of law (not groundless); fees were not properly segregated and unproven | Trial court assessed sanctions and awarded attorneys’ fees; Appellants appeal those rulings |
Key Cases Cited
- Provident Life & Accident Ins. Co. v. Knott, 128 S.W.3d 211 (Tex. 2003) (summary judgment burdens and standards)
- M.D. Anderson Hosp. & Tumor Inst. v. Willrich, 28 S.W.3d 22 (Tex. 2000) (summary judgment burden stays with movant)
- Park Place Hosp. v. Estate of Milo, 909 S.W.2d 508 (Tex. 1995) (disputed fact issues preclude summary judgment)
- Sullivan v. Hardin, 102 S.W.2d 1110 (Tex. Civ. App. 1937) (strict compliance required for trustee's sales)
- Vortt Exploration Co. v. Chevron U.S.A., Inc., 787 S.W.2d 942 (Tex. 1990) (quantum meruit and contract doctrines)
- Longview Constr. & Dev., Inc. v. Loggins Constr. Co., 523 S.W.2d 771 (Tex. Civ. App. — Tyler 1975) (wrongful interference and excused performance)
- Tony Gullo Motors I, L.P. v. Chapa, 212 S.W.3d 299 (Tex. 2006) (attorney fee recovery and segregation principles)