577 S.W.3d 336
Tex. App.2019Background
- Business Bank loaned $3,000,000 to Barquero Energy Services, LLC for a salt water disposal well; Barquero executed the note and Wyrick signed as managing member. Barquero also signed an arbitration agreement with the Bank.
- Wyrick and Ruhnke each signed broad "Unlimited, Unconditional Guaranty" agreements that waived many defenses and allowed the Bank to enforce guarantees without first pursuing collateral.
- Barquero defaulted; the Bank did not foreclose the leasehold but sought to enforce the personal guaranties; appellants refused to pay and asserted contract defenses and tort counterclaims.
- The Bank moved for summary judgment on the guaranties and no-evidence and traditional summary judgment on appellants’ counterclaims; the trial court entered judgment for the Bank for $3 million, dismissed appellants’ counterclaims, and included a permanent anti-suit injunction enjoining related suits (including a Dimmit County suit filed by Barquero Fund).
- On appeal, the court (14th Ct. App.) affirmed summary judgment enforcing the guaranties (rejecting appellants’ affirmative defenses and counterclaims for lack of proof or standing) but held the permanent anti-suit injunction was an abuse of discretion and modified the judgment to dissolve it.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| 1. Were the guaranties avoidable due to fraudulent inducement or negligent misrepresentation? | Appellants: Bank orally promised it would secure lease collateral; they relied and were induced to sign guaranties. | Bank: Guaranties are unambiguous and allocate risk to guarantors; written terms negate justifiable reliance. | Held: Affirmed for Bank — guaranties’ unambiguous terms preclude justifiable reliance; defenses fail. |
| 2. Is mutual mistake a defense to enforcement of the guaranties? | Appellants: Parties mutually (but mistakenly) believed collateral existed so guaranties should be void. | Bank: Guaranties expressly allocate the risk of collateral failure to guarantors. | Held: Affirmed for Bank — appellants assumed the risk; mutual mistake defense fails. |
| 3. Do appellants have standing and evidence to sustain tort counterclaims (fraud, nondisclosure, negligence, gross negligence, tortious interference)? | Appellants: Bank’s post-default conduct (misrepresentations to buyers/investors) caused personal injury and loss of business opportunities. | Bank: Many claims belong to Barquero (no standing); no-evidence on essential elements; relief was procedurally available in other forums. | Held: Affirmed for Bank — appellants lack standing for claims that belong to Barquero (e.g., tortious interference) and failed to present evidence on elements; summary judgment proper. |
| 4. Was the permanent anti-suit injunction (enjoining related suits outside Travis County) proper? | Bank: Injunction protects Travis County court’s dominant jurisdiction, prevents multiplicity of suits, enforces arbitration/order, and guards against collateral attack. | Appellants: Bank failed procedural prerequisites; injunction unnecessary because alternative remedies (abatement, motions to compel arbitration, preclusive defenses) exist. | Held: Reversed as to injunction — trial court abused discretion; injunction dissolved. |
Key Cases Cited
- JPMorgan Chase Bank, N.A. v. Orca Assets, G.P., LLC, 546 S.W.3d 648 (Tex. 2018) (justifiable reliance may be negated as a matter of law where written contract contradicts alleged oral misrepresentations)
- Golden Rule Ins. Co. v. Harper, 925 S.W.2d 649 (Tex. 1996) (anti-suit injunctions are extraordinary and may be issued only in very special circumstances)
- Geodyne Energy Income Prod. P’ship I-E v. Newton Corp., 161 S.W.3d 482 (Tex. 2005) (a party may assume the risk of a mistake by contract and thus cannot void a bargain for mutual mistake)
- Gannon v. Payne, 706 S.W.2d 304 (Tex. 1986) (anti-suit injunction is an extraordinary remedy to be issued sparingly to protect a court’s jurisdiction)
- Cantey Hanger, LLP v. Byrd, 467 S.W.3d 477 (Tex. 2015) (summary judgment review standard—view evidence in light most favorable to nonmovant)
- City of Keller v. Wilson, 168 S.W.3d 802 (Tex. 2005) (standard for reviewing sufficiency and weight of evidence on summary judgment)
- Bridas Corp. v. Unocal Corp., 16 S.W.3d 887 (Tex. App.—Houston [14th Dist.] 2000) (discussing narrow circumstances where anti-suit injunctions may be appropriate to prevent evasion of jurisdiction or preclusion defenses)