436 S.W.3d 325
Tex. App.2013Background
- Krainz sued Kodiak Resources for breach of contract to memorialize a 10% stock transfer; he also sought minority shareholder protections and related claims.
- Telfer, Kodiak’s founder and sole owner, allegedly promised 10% stock to Krainz as part of compensation but no stock certificates were issued.
- Krainz worked as Kodiak’s controller from 1999; in 2001 Kodiak assigned employees to BBX and Krainz remained in roles through 2007.
- Kodiak argued Krainz’s contract claim accrued in 1999 and was time-barred; the trial court granted summary judgment and dismissed related claims.
- The trial court also granted Kodiak special exceptions and a plea to the jurisdiction, and denied attorney’s fees to Krainz; judgment was final as to certain rulings.
- On appeal, the court reversed in part, concluded issues on standing and contract timing presented genuine fact questions, and remanded for further proceedings.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Krainz’s contract claim is time-barred | Krainz contends live pleadings show a later accrual date. | Krainak argues limitations began in 1999; suit in 2007 was time-barred. | Trial court erred; triable fact issue remained on accrual date. |
| Whether special exceptions were properly enforced | Special exceptions should control remaining pleadings after summary judgment. | Special exceptions should align with the contract ruling and be enforced. | Special-exceptions ruling on contract claims reversed; moot after remand. |
| Whether Krainz has standing to pursue shareholder claims | Oral agreement and equitable ownership may confer shareholder status. | Standing requires legal/contractual basis; Krainz lacked certificates and formal ownership. | There is a fact issue on standing; Krainz may be a shareholder for standing purposes. |
| Whether the court properly addressed attorney’s fees and final judgment | Fees and final judgments should be decided after substantive resolution. | Prevailing party entitled to fees; final judgment appropriate. | Reversed as to fee issues; remanded; moot on other points. |
Key Cases Cited
- Southwestern Elec. Power Co. v. Grant, 73 S.W.3d 211 (Tex.2002) (summary judgment standard and appellate de novo review)
- Sosa v. Central Power & Light, 909 S.W.2d 893 (Tex.1995) (live pleadings govern at time of judgment; superseding petitions)
- Texas Lottery Comm’n v. Scientific Games Int’l, Inc., 99 S.W.3d 376 (Tex.App.-Austin 2003) (standing as a jurisdictional issue; de novo review)
- Greenspun v. Greenspun, 194 S.W.2d 134 (Tex.Civ.App.-Fort Worth 1946) (ownership without certificates; equitable ownership considerations)
- Rio Grande Cattle Co. v. Burns, 17 S.W. 1044 (Tex. 1891) (shareholder status without certificates when entitled to stock)
- Willis v. Donnelly, 199 S.W.3d 262 (Tex.2006) (equitable ownership versus expressed contract; factual record)
- Irwin v. Prestressed Structures, Inc., 471 S.W.2d 865 (Tex.App.-Eastland 1971) (accrual timing and cure of limitations defenses)
- Davis Apparel v. Gale-Sobel, 117 S.W.3d 15 (Tex.App.-Eastland 2003) (breach of commission promises; timing of breaches)
- Hydroscience Tech., Inc. v. Hydroscience, Inc., 401 S.W.3d 783 (Tex.App.-Dallas 2013) (stock transfer without certificate; ownership via delivery and acts)