Grayco Town Lake Investment 2007 LP v. Coinmach Corporation
03-15-00088-CV
Tex. App.May 27, 2015Background
- Grayco bought Regatta Apartments with actual and constructive notice of a 2002 Coinmach lease and supplemental terms.
- Coinmach held a 2002 lease for laundry rooms under Bridge; 1992 lease preceded it.
- Supplemental Agreement provided a prorated refund of a lease bonus if Lessee removed equipment early.
- Grayco discovered the Memorandum of Lease before closing but did not obtain copies of the 2002 lease or Supplemental Agreement.
- Grayco demolished the premises and ceased maintenance, terminating the lease early and injuring Coinmach’s income.
- Trial court found for Coinmach after a one-day bench trial; no findings of fact or conclusions of law were issued.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Was Grayco bound by the 2002 lease as a bona fide purchaser? | Grayco had notice via the Memorandum; thus bound | Grayco did not have notice of the 2002 lease | Grayco bound; bona fide purchaser defense failed |
| Did Grayco materially breach the 2002 lease? | Grayco terminated early and demolished, breaching covenants | No breach; no express prohibition on early termination | Yes, material breach established |
| Did Coinmach suffer damages from Grayco’s breach? | Damages from lost income and prorated lease bonus refund | Damages speculative; no guaranteed revenue | Damages established, including lost profits and prorated refund |
| Was the damages award justified (summary/amount)? | Evidence supports calculated lost profits and refund | Awards are speculative; methodology flawed | Sufficient evidence supports damages award |
Key Cases Cited
- Westland Oil Development Corp. v. Gulf Oil Corp., 637 S.W.2d 903 (Tex. 1982) (purchaser on notice of encumbrances through chain of title)
- Beutell v. United Coin Meter Co., 462 S.W.2d 334 (Tex. Civ. App.—Waco 1970) (purchaser on notice of unrecorded leases via Beutell rule)
- Doss v. Blackstock, 466 S.W.2d 59 (Tex. Civ. App.—Austin 1971) (implied findings and reasonable inferences standard)
- Sonnier v. Sonnier, 331 S.W.3d 211 (Tex. App.—Beaumont 2011) (constructive eviction and damages principles)