Gary M. Prater v. 5L Properties
11-23-00178-CV
| Tex. App. | Aug 29, 2025Background
- 5L Properties operates an oil and gas lease on land owned by Gary M. Prater; the lease requires 5L to compensate Prater for certain damages.
- In 2019 and 2020, Prater sent demand letters for alleged damages to land and cattle caused by a saltwater leak, adding a demand for 18% interest per month if unpaid.
- Prater, initially representing himself, filed suit for breach of lease and sought declaratory relief; 5L counterclaimed for usury under the Texas Finance Code.
- The trial court refused to hear Prater’s damage claim, granted the requested declaratory relief (binding parties to lease terms), and awarded 5L $2,000 for usury, plus fees.
- On appeal, Prater, now represented by counsel, challenged the exclusion of his damages claim and the usury award.
- The appellate court affirmed declaratory relief, reversed the usury judgment, and remanded the breach of contract/damages claim for trial.
Issues
| Issue | Plaintiff’s Argument | Defendant’s Argument | Held |
|---|---|---|---|
| Trial Court Refusal: Damages Claim | Pleadings provided fair notice of breach/damages claim | Prayer did not specifically request money damages | Prater’s pleadings sufficient; trial required |
| Usury Counterclaim | No loan/credit relationship; not a creditor under statute | Interest demand letter made Prater a creditor | Prater not a creditor; judgment reversed |
| Applicability of Consumer Usury Law | Not consumer/personal/family use; lease was commercial | Statute applies; sought $2,000 under consumer provision | Lease not covered by provision |
| Jury Trial Right | Entitled to jury trial on fact issues | No fact issue; relief was only declaratory | Moot due to reversal on usury |
Key Cases Cited
- Low v. Henry, 221 S.W.3d 609 (Tex. 2007) (Texas follows a fair notice standard for pleading)
- Horizon/CMS Healthcare Corp. v. Auld, 34 S.W.3d 887 (Tex. 2000) (pleading sufficiency requires fair and adequate notice)
- Alan Reuber Chevrolet, Inc. v. Grady Chevrolet, Ltd., 287 S.W.3d 877 (Tex. App.—Dallas 2009) (general prayer for relief does not support attorney’s fee award)
- Kissman v. Bendix Home Sys., Inc., 587 S.W.2d 675 (Tex. 1979) (prayer sufficient if consistent with claim theory in petition)
- Producer's Constr. Co. v. Muegge, 669 S.W.2d 717 (Tex. 1984) (court cannot render judgment before right to present evidence)