in the Interest of S.C. and K.C., Childen
552 S.W.3d 291
| Tex. App. | 2016Background
- Husband and Wife executed a premarital Agreement in contemplation of marriage (2005) with a forfeiture clause (Section 31 and Section 13(h)) providing Wife would forfeit a cash payment if she sought to invalidate the Agreement or recover property inconsistent with it.
- Husband filed for divorce (2011); Wife counter-petitioned and expressly asked the court to enforce the Agreement initially.
- Wife later (third amended counter-petition, June 2012) pleaded rescission of the Agreement, alleging Husband’s material breach and fraud.
- Husband sought declaratory relief that Wife forfeited the cash payment by seeking rescission; trial court initially denied summary judgment, a jury trial produced confusing findings, and the trial court granted a new trial.
- After additional summary judgment proceedings (including dismissal with prejudice of Wife’s affirmative defenses of prior material breach and repudiation), the trial court granted Husband’s partial summary judgment declaring Wife sought to invalidate the Agreement, sought property inconsistent with it, and forfeited the cash payment; Wife appealed.
Issues
| Issue | Q.C. (Wife) Argument | I.C. (Husband) Argument | Held |
|---|---|---|---|
| 1. Can Husband rely on Wife’s superseded third amended counter-petition as basis for summary judgment? | Third amended petition was superseded and therefore its statements cannot support summary judgment. | Wife’s subsequent pleadings continued to assert rescission; the earlier pleading can be treated as a party admission to show she sought rescission. | Court: No error; statements show she sought to invalidate Agreement and are admissible as party admissions. |
| 2. Does pleading rescission in the alternative avoid triggering the Agreement’s forfeiture clause? | Rescission was pleaded only as an alternative remedy, so she did not actually seek to invalidate the Agreement in a way that triggers forfeiture. | Forfeiture clause applies when a party seeks to invalidate the Agreement or recover property inconsistent with it, regardless of whether rescission was pleaded alternatively. | Court: Forfeiture clause applies; pleading rescission (even alternatively) invoked clause, so Wife forfeited the cash payment. |
| 3. Did the trial court err by granting summary judgment when it earlier denied Husband’s summary judgment on Wife’s affirmative defenses of prior material breach and repudiation? | Earlier denial showed unresolved fact issues about Husband’s breach/repudiation that would excuse Wife’s conduct and avoid forfeiture. | Husband later moved again and the trial court subsequently granted summary judgment dismissing those affirmative defenses with prejudice prior to declaratory ruling. | Court: No error; the defenses were later dismissed by summary judgment before declaratory judgment, so forfeiture stands. |
Key Cases Cited
- Valence Operating Co. v. Dorsett, 164 S.W.3d 656 (Tex. 2003) (standard for reviewing traditional summary judgment).
- Neely v. Wilson, 418 S.W.3d 52 (Tex. 2013) (moving party bears burden on summary judgment).
- W. Inv., Inc. v. Urena, 162 S.W.3d 547 (Tex. 2005) (summary judgment requires no genuine issue of material fact).
- Sosa v. Central Power & Light, 909 S.W.2d 893 (Tex. 1994) (superseded pleadings cannot form the basis for summary judgment where the superseding pleading deleted the allegations).
- Bay Area Healthcare Grp., Ltd. v. McShane, 239 S.W.3d 231 (Tex. 2007) (statements in superseded pleadings may be admissible as party admissions).
- Kirby Lake Dev., Ltd. v. Clear Lake City Water Auth., 320 S.W.3d 829 (Tex. 2010) (courts avoid unintended forfeitures when construing contract language).
- Aquaplex, Inc. v. Rancho La Valencia, Inc., 297 S.W.3d 768 (Tex. 2009) (contract construction to avoid forfeiture where appropriate).
- McLendon v. McLendon, 862 S.W.2d 662 (Tex. App.—Dallas 1993, writ denied) (in terrorem clauses not triggered by certain estate litigation).
- Meridien Hotels, Inc. v. LHO Fin. P’ship I, L.P., 255 S.W.3d 807 (Tex. App.—Dallas 2008) (clear and specific forfeiture provisions will be enforced).
- Marion v. Davis, 106 S.W.3d 860 (Tex. App.—Dallas 2003, pet. denied) (actions falling within clear forfeiture clause result in forfeiture).