National Property Holdings, L.P., Michael Plank, and Russell Plank v. Gordon Westergren
409 S.W.3d 110
| Tex. App. | 2013Background
- Gordon Westergren sought to purchase and develop 190 acres in LaPorte, TX, via a sequence of option agreements and lis pendens; the Plank Parties (NPH, Michael Plank, Russell Plank) encountered Westergren through mediation related to the 190 acres.
- During mediation in 2005, Russell Plank allegedly promised Westergren a $1 million payment and a 5% profits interest in the 190 acres in exchange for releasing his lis pendens and contractual rights.
- A draft profits-interest agreement circulated in 2005 but was never signed; the January 2006 Mediation Settlement Agreement (MSA) listed NPH as a signatory but did not sign Russell Plank personally.
- In February 2006 Westergren signed a two-page Agreement and Release after receiving $500,000, later discovering the Release released Westergren’s claims; Westergren contends the Release was procured by fraud.
- In 2006-2007, Westergren released the lis pendens, NPH acquired the 190 acres, and the Plank Parties partially paid Westergren, with damages, fees, and claims litigated at trial.
- The trial court rendered take-nothing judgments for both sides, leading to Westergren’s appeal and the Plank Parties’ cross-appeal for various contractual and fraud-related issues.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether JNOV on Westergren’s contract claim was proper | Jury found Russell’s personal contract; partial performance supports contract. | Evidentiary grounds and statute-of-frauds defenses negate contract; release may bar claim. | JNOV improper; contract reinstated against Russell; grounds insufficient. |
| Whether JNOV on Westergren’s partnership and fraud claims was proper | Damages measured by contract flow through to tort theories; no bar from statute of frauds. | Fraud and partnership claims barred by statute or lack of causation. | JNOV on partnership and fraud reversed; tort damages limited by one-satisfaction rule. |
| Whether MSA/Release foreclosed Westergren’s contract claim | MSA/Release did not expressly release or indemnify Westergren; partial-performance exception applies. | MSA/Release bar contract; releases apply to agents and terms are unambiguous. | MSA/Release did not conclusively bar contract; material fact issues remained; reversal. |
| Whether the trial court abused its discretion by denying leave to amend | Amendment sought to plead lack of consideration; relevant to contract. | No reversible error; issues already decided; amendment unnecessary. | Not necessary to resolve; issue deemed moot by reversal. |
| Whether the court correctly awarded costs against Westergren | Westergren prevailed on contract; costs should follow the victorious party. | Costs awarded in error due to JNOV; reversal requires reallocation of costs. | Costs reversed and remanded for allocation consistent with decision. |
Key Cases Cited
- City of Keller v. Wilson, 168 S.W.3d 802 (Tex. 2005) (legal-sufficiency standards; defer to jury on credibility; reasonable-inference standard)
- Exxon Corp. v. Breezevale Ltd., 82 S.W.3d 429 (Tex.App.-Dallas 2002) (partial-performance and statute of frauds; virtual fraud concept)
- Sbrusch v. Fort Bend County Drainage Dist., 818 S.W.2d 392 (Tex.1991) (standard for affirming or reversing JNOV; grounds for remand")
- Fish v. Tandy Corp., 948 S.W.2d 886 (Tex.App.-Fort Worth 1997) (merger doctrine and contracts; same-party requirement for merger")
- First City Mortgage Co. v. Gillis, 694 S.W.2d 144 (Tex.App.-Houston (14th Dist.) 1985) (fiduciary-duty and duty to disclose unambiguous contract terms)