Principal Life Insurance Co. v. Revalen Development, LLC
358 S.W.3d 451
| Tex. App. | 2012Background
- Revalen Development, LLC sued Principal Life for breach of an oral contract to sell a note secured by a shopping center in Addison, Texas.
- The note matured June 1, 2009; Principal Life sought refinance negotiations rather than foreclosure, then marketed the note.
- A July 16, 2009 Real Estate Committee approved a proposed sale to Cheng Investments, with a shell PSA and forwarding of terms for a written PSA.
- Cheng and Logsdon exchanged a redlined PSA that changed Buyer to Revalen, altered price, extended closing, and removed liability limits.
- Cheng and Logsdon communicated an approval to proceed, but the redline suggested many terms remained unsettled and nonbinding.
- The trial court entered judgment for Revalen; the court of appeals reversed and rendered take-nothing for Principal Life.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Was there an offer, acceptance, and meeting of the minds for an oral contract? | Revalen argues July 16 call and conduct formed an oral contract. | Principal Life argues no binding offer or meeting of minds existed; agreement remained in negotiations for a written PSA. | No binding oral contract; insufficient offer/meeting of minds. |
Key Cases Cited
- Thornton v. Dobbs, 355 S.W.3d 312 (Tex.App.-Dallas 2011) (trial court findings in bench trial carry same weight as jury verdict)
- Pulley v. Milberger, 198 S.W.3d 418 (Tex.App.-Dallas 2006) (review of sufficiency standards for contract formation)
- Catalina v. Blasdel, 881 S.W.2d 295 (Tex.1994) (standard for reviewing contract formation and meeting of minds)
- City of Keller v. Wilson, 168 S.W.3d 802 (Tex.2005) (legal sufficiency standards; context matters in reviewing evidence)
- Gasmark, Ltd. v. Kimball Energy Corp., 868 S.W.2d 925 (Tex.App.-Fort Worth 1994) (informal agreements; effect of written draft in binding obligations)
- Scott v. Ingle Bros. Pac., Inc., 489 S.W.2d 554 (Tex.1972) (informal writings may show preliminary negotiations or binding contract depending on circumstances)
- Murphy v. Seabarge, Ltd., 868 S.W.3d 929 (Tex.App.-Houston [14th Dist.] 1994) (considerations for when informal negotiations become binding)