Lone Star Air Systems, LTD v. David Powers
401 S.W.3d 855
Tex. App.2013Background
- Lone Star Air Systems, Ltd. sued Powers for breach of contract, promissory estoppel, and fraud related to unpaid invoices on a Master Purchase Order Agreement.
- The Agreement concerned the sale of goods for Lone Star and David Powers Homes, with Powers allegedly not signing the contract and various entities involved, including DJPH, LLC, and David Powers Homes as an assumed name.
- Powers and related entities ceased operations of DPH, Inc. in 2009; in 2010 a petition to confess judgment was filed by DPH, Inc., later nonsuited, leaving Lone Star’s claims against Powers and related entities.
- The trial court granted Powers’ traditional and hybrid summary judgments, concluding no enforceable contract existed between Lone Star and Powers and disposing of all claims as a final judgment.
- Lone Star argued Powers admitted a contract existed and that exceptions to the statute of frauds applied; Powers argued he was not a party to the Agreement and that the contract was with DJPH, LLC d/b/a David Powers Homes.
- On appeal, the court reviewed de novo the no-evidence and traditional summary judgment standards and concluded Powers was not a party to the contract, promissory estoppel was not sufficiently plead, and Lone Star failed to prove fraud primarily for Powers’ direct personal benefit.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Contract enforceability under statute of frauds | Lone Star contends Powers had a contract with Lone Star and exceptions to the statute apply. | Powers was not a party; DJPH, LLC is the contract party through an assumed name chain. | Powers not party; no enforceable contract. |
| Promissory estoppel pleading and scope | Promissory estoppel implied by catch-all pleading and alleged representations. | Promissory estoppel not fairly plead and not independently pleaded. | Promissory estoppel not properly pleaded; no issue. |
| Fraud claim against Powers individually and veil theory | Powers acted individually in misrepresentation and per se fraud. | Texas corporate veil provisions preclude individual liability absent personal fraud for direct benefit. | No competent evidence of personal benefit or independent fraud; no individual liability. |
Key Cases Cited
- Mendoza v. Fiesta Mart, Inc., 276 S.W.3d 653 (Tex. App.—Houston [14th Dist.] 2008) (no-evidence standard and review of evidence)
- City of Keller v. Wilson, 168 S.W.3d 802 (Tex. 2005) (standards for reviewing factual disputes in summary judgments)
- PAS, Inc. v. Engel, 350 S.W.3d 602 (Tex. App.—Houston [14th Dist.] 2011) (no-evidence summary judgment framework)
- Forbes, Inc. v. Granada Biosciences, Inc., 124 S.W.3d 167 (Tex. 2003) (more than a scintilla and probative evidence standard)
- Lehmann v. Har-Con Corp., 39 S.W.3d 191 (Tex. 2001) (final judgment disposal of claims requirement)
- Formosa Plastics Corp. USA v. Presidio Eng’rs & Contractors, Inc., 960 S.W.2d 41 (Tex. 1998) (elements of fraud)
- English v. Fischer, 660 S.W.2d 521 (Tex. 1983) (elements of promissory estoppel)
- Goss v. Bobby D. Assocs., 94 S.W.3d 65 (Tex. App.—Tyler 2002) (deemed admissions cannot be contradicted by later affidavits in summary judgment)