in the Estate of Reda Brown Allison
09-16-00066-CV
| Tex. App. | Oct 19, 2017Background
- Decedent Reda Allison executed deeds in April 1988 conveying two tracts to AFCI, Inc.; the deeds were notarized and recorded and show Albert and Reda as grantors and AFCI as grantee. AFCI’s stock ledger shows one share issued to Reda’s son, Albert R. Allison III (Ray). AFCI forfeited its corporate franchise in 1989.
- Reda executed a will in 2004; she died in October 2014. Her daughter Crystal was appointed independent executor and filed an inventory including the two tracts as estate property. Ray and sister Linda disputed that the tracts belonged to the estate, asserting AFCI owned them.
- Crystal alleged the 1988 conveyances were sham transfers to shield the tracts from IRS levy; she sought delivery of the tracts to the estate. Ray and Linda asserted the deeds were valid and raised statutes-of-limitations and ownership defenses.
- Evidence at the January 2016 probate hearing included the recorded deeds, AFCI’s stock ledger and stock certificate, Albert’s 2001 estate inventory (which did not list the tracts or AFCI shares), and a 2008 seller‑financed purchase agreement between Reda and buyer Billy Rawls for the smaller tract.
- The county judge found the tracts belonged to Reda’s estate and ordered future payments from Rawls to the executor and reimbursement from Ray for installments he had collected; Ray and Linda appealed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the Estate’s claim that Reda owned the tracts at death is barred by limitations | Estate: limitations should be deferred; executor only discovered the alleged fraud after appointment | Ray/Linda: conveyances occurred in 1988 and Reda, as grantor, was on notice; causes of action accrued in 1988 | Court: Claims accrued on execution in 1988; four‑year limitations expired in 1992; estate’s claims time‑barred |
| Whether the discovery rule postpones accrual of the Estate’s claims | Estate: discovery rule applies because executor learned of scheme only after appointment | Ray/Linda: discovery rule doesn't apply; decedent was a participant and record deed put her on notice | Court: Discovery rule not applicable; decedent’s claims were not inherently undiscoverable and accrued on execution |
| Whether judicial estoppel barred Ray and Linda from asserting AFCI’s ownership (based on Ray’s bankruptcy schedules) | Estate: Ray’s bankruptcy representations (e.g., $0 par value; not listing single‑asset real estate) preclude his present claim | Ray/Linda: bankruptcy schedules did not represent AFCI lacked assets; ‘‘par value’’ is unrelated to assets; AFCI owned multiple tracts and was not necessarily a single‑asset entity | Court: Trial court erred; judicial estoppel did not prevent Ray/Linda from relying on the recorded deeds showing AFCI ownership |
| Whether Ray must return payments Rawls made after Reda’s death | Estate: Ray improperly collected payments due to the estate under Reda’s sale agreement | Ray: AFCI owned the tract; as AFCI’s beneficial owner he could ratify the contract and accept payments | Court: Ray entitled to keep payments; estate had no reimbursement claim and cannot collect remaining balance from Rawls |
Key Cases Cited
- Town of Dish v. Atmos Energy Corp., 519 S.W.3d 605 (Tex. 2017) (accrual is a question of law; claim accrues when wrongful act causes legal injury)
- Cosgrove v. Cade, 468 S.W.3d 32 (Tex. 2015) (grantors charged with notice of deed contents upon execution)
- Ford v. Exxon Mobil Chem. Co., 235 S.W.3d 615 (Tex. 2007) (actions to set aside voidable deeds governed by four‑year limitations)
- Nat. Gas Pipeline Co. of Am. v. Pool, 124 S.W.3d 188 (Tex. 2003) (record titleholder’s ignorance does not stop limitations)
- Little v. Smith, 943 S.W.2d 414 (Tex. 1997) (discovery rule not applied in probate contexts alleging fraud)
- Pleasant Glade Assembly of God v. Schubert, 264 S.W.3d 1 (Tex. 2008) (judicial estoppel precludes inconsistent positions taken successfully earlier)
- Computer Associates Int’l v. Altai, Inc., 918 S.W.2d 453 (Tex. 1996) (analysis of when discovery rule may apply)
- Estate of Stonecipher v. Estate of Butts, 591 S.W.2d 806 (Tex. 1979) (discovery rule can apply where decedent was victim of fraud preventing discovery)