501 S.W.3d 344
Tex. App.2016Background
- In 2004–05 Basil and Wendy Beck (Buyer) contracted to buy King’s Crossing golf course from Seller entities; San Jacinto Title signed a final page acknowledging receipt and promising confidentiality and also served as escrow/title agent.
- The written purchase agreement defined “Parties Bound” to be only Buyer and Seller and contained a prevailing-party attorney’s fees clause providing that "the prevailing party" could recover fees if either party had to employ counsel to enforce or defend rights under the contract.
- In 2009 Mark Scott (San Jacinto president) sent a letter opposing a proposed re-plat and stating that any re-plat would require City Council approval; Kingsley (the Becks’ entity) sued for business disparagement, breach of contract (confidentiality), tortious interference, and breach of fiduciary duty, claiming the letter caused a prospective sale to fail.
- At trial the jury found for San Jacinto on all claims; the trial court awarded San Jacinto attorney’s fees under the contract and excluded part of Kingsley’s expert testimony about Corpus Christi law.
- On appeal the court addressed two issues: (1) whether San Jacinto (a signatory of limited, escrow-related provisions) was a “party” entitled to contractual attorney’s fees under the agreement, and (2) whether the trial court abused its discretion by excluding expert testimony about the City Council’s authority.
- The court reversed the fee award (holding San Jacinto not entitled to fees under the contract’s defined scope of “party”) and affirmed the exclusion of the expert testimony.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether San Jacinto is a "party" entitled to attorney’s fees under the agreement | The agreement’s prevailing-party clause applies by its ordinary legal meaning; San Jacinto signed the agreement and thus is a party entitled to fees | The contract’s language ("Parties Bound" = Buyer and Seller; use of "either party") limits "party" to buyer and seller; San Jacinto’s role was limited (title/escrow) and it signed only an acceptance/confidentiality line | Court: Contract defines "party" narrowly; San Jacinto is not a "party" for the fees clause — reverse fee award and render judgment that appellees take nothing on fees |
| Whether trial court abused discretion by excluding expert testimony about Corpus Christi ordinances that allegedly show City Council lacked discretionary plat-approval authority | Philo consistently opined that re-plat would not require discretionary City Council approval; he later relied on Corpus Christi ordinances — exclusion was improper because opinions were disclosed and experts may refine bases through trial | San Jacinto argued Philo had testified earlier he hadn’t reviewed Corpus ordinances and plaintiff failed to supplement discovery as required; it would be prejudiced without opportunity to re-depose | Court: Trial court acted within discretion under Tex. R. Civ. P. 195.6 and 193.6 in excluding testimony limited to that newly asserted local-law basis; affirmed exclusion |
Key Cases Cited
- MCI Telecomms. Corp. v. Tex. Utils. Elec. Co., 995 S.W.2d 647 (Tex. 1999) (when contract unambiguous, construction is question of law)
- Seagull Energy E & P, Inc. v. Eland Energy, Inc., 207 S.W.3d 342 (Tex. 2006) (primary concern is parties’ intent as expressed in instrument)
- Coker v. Coker, 650 S.W.2d 391 (Tex. 1983) (harmonize all contract provisions so none are rendered meaningless)
- Valence Operating Co. v. Dorsett, 164 S.W.3d 656 (Tex. 2005) (give contract terms their plain, ordinary meanings unless used technically)
- Intercont’l Grp. P’ship v. KB Home Lone Star LP, 295 S.W.3d 650 (Tex. 2009) (parties may define "prevailing party" by contract language)
- Lesieur v. Fryar, 325 S.W.3d 242 (Tex. App.—San Antonio 2010) (contractual definition of "party" limited to buyer/seller precluded broker/title agent fee recovery)
- Perry Homes v. Cull, 258 S.W.3d 580 (Tex. 2008) (abuse-of-discretion standard for evidentiary rulings; appellate court not to substitute its judgment)