Mark Davis v. Highland Coryell Ranch, LLC
578 S.W.3d 242
Tex. App.2019Background
- Mark Davis was an original member of Highland Coryell Ranch, LLC who relinquished his membership interest in 2005 and later requested company business records developed while he was a member.
- Highland produced some records but refused others; Davis sued to inspect the remaining records under the Texas Business Organizations Code.
- On initial appeal the court remanded because the summary-judgment record lacked Highland’s governing documents; on remand Highland attached those documents and moved for summary judgment again, which the trial court granted.
- Central statutory provisions: definitions of “member” (§ 1.002(53)(A)) and inspection rights (§§ 101.502, 3.153) in the Texas Business Organizations Code; inspection requires a written request and a "proper purpose."
- Highland argued a former member has no right to inspect records; Davis argued the statutory definition of “member” (which includes one who "has been admitted as a member") permits former members to inspect for a proper purpose.
- The Court of Appeals reversed the trial court, holding that the statutory text allows former members to access records for a proper purpose and that Highland had not established entitlement to summary judgment on the limited ground it urged.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the doctrine of law of the case prevented reconsideration of issues previously decided on an incomplete record | Davis: prior appellate language meant he was entitled as a matter of law to access records | Highland: prior opinion should control and preclude relitigation | Court: law of the case did not apply because facts/issues now differ and prior decision could be corrected if wrong; discretion permits reconsideration |
| Whether a former member may inspect LLC business records under the statute | Davis: “has been admitted as a member” includes former members, so ex-members can inspect for a proper purpose | Highland: phrase requires continuing membership; former members have no statutory inspection right | Court: statute’s phrasing is unambiguous; “has been admitted as a member” includes persons admitted in the past (former members); former members may seek records for a proper purpose, so summary judgment was improper |
Key Cases Cited
- In re Office of the Attorney General, 422 S.W.3d 623 (Tex. 2013) (statutory text controls and courts must give meaning to each word)
- Briscoe v. Goodmark Corp., 102 S.W.3d 714 (Tex. 2003) (law-of-the-case doctrine is discretionary and may be forgone when earlier decision is clearly wrong)
- State Farm Lloyds v. Page, 315 S.W.3d 525 (Tex. 2010) (summary judgment cannot be affirmed on a ground not presented to the trial court)
