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Psalm 9:1 Wells Family, LLC v. Michael D. Cour and 183 Ranch Corporation D/B/A Equicare
09-19-00459-CV
Tex. App.
Mar 10, 2022
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Background

  • In Nov. 2017 Michael Cour signed a $12,000 promissory note for “short-term financing of Equicare improvements”; the note identifies the "Borrower" as "Michael Cour" and Cour’s signature contains no officer or corporate-capacity notation.
  • Equicare is a trade name used by 183 Ranch Corporation, and the loan proceeds were used on property owned by 183 Ranch.
  • An amendment to the note (executed at Psalm’s request) likewise identifies the Borrower as "Michael Cour" and was signed by Cour individually.
  • Psalm sued Cour and 183 Ranch after sending a demand letter; Cour later signed an agreed partial judgment resolving Psalm’s claim against him but reserving any claim against 183 Ranch.
  • At trial the court conducted a bench proceeding on Psalm’s remaining claim against 183 Ranch; Psalm presented testimony (Mathew Wells) claiming an expectation that Cour could bind 183 Ranch but produced no evidence Cour signed in a representative capacity.
  • The trial court found the note unambiguous, held only Cour liable, rendered a take-nothing judgment against 183 Ranch, and this appeal followed.

Issues

Issue Plaintiff's Argument Defendant's Argument Held
1. Did the trial court lack power to dismiss Psalm’s claim sua sponte? Trial court dismissed without a dispositive motion; plaintiff deprived of jury trial. Court adjudicated on the merits after Psalm invited a bench proceeding and presented evidence; no sua sponte dismissal. Overruled — not a sua sponte dismissal; Psalm invited bench trial; invited-error and preservation rules apply.
2. Is 183 Ranch jointly liable on the note though only Cour signed? Evidence supports a fact issue that Cour signed in dual (individual + president) capacity, making 183 Ranch liable. Note unambiguously names only "Michael Cour" as Borrower; no written modification making 183 Ranch a party. Overruled — note unambiguous; only Cour is obligor; court will not insert language to make 183 Ranch a borrower.
3. Was the note ambiguous (allowing extrinsic/parol evidence to show representative signing)? Note ambiguous; extrinsic evidence should be admitted to show intent and dual signing capacity. Note and amendment unambiguously name Cour; parol evidence barred; no written agreement to modify. Overruled — court found the note unambiguous; parol evidence inapplicable; no error in excluding additional extrinsic relief.

Key Cases Cited

  • Sundown Energy LP v. HJSA No. 3, Ltd., P’ship, 622 S.W.3d 884 (Tex. 2021) (contract construction is a legal question reviewed de novo).
  • Barrow-Shaver Res. Co. v. Carrizo Oil & Gas, Inc., 590 S.W.3d 471 (Tex. 2019) (parol evidence rule bars evidence that contradicts or adds to an unambiguous written agreement).
  • Tittizer v. Union Gas Corp., 171 S.W.3d 857 (Tex. 2005) (invited-error doctrine bars complaining about a procedure the party requested).
  • Fortis Benefits v. Cantu, 234 S.W.3d 642 (Tex. 2007) (courts will not rewrite clear contract terms by inserting language not agreed to).
  • Tex. v. Rideaux, 838 S.W.2d 340 (Tex. App.—Houston [1st Dist.] 1992, no writ) (bench adjudication on the merits is not the same as a sua sponte dismissal).
Read the full case

Case Details

Case Name: Psalm 9:1 Wells Family, LLC v. Michael D. Cour and 183 Ranch Corporation D/B/A Equicare
Court Name: Court of Appeals of Texas
Date Published: Mar 10, 2022
Docket Number: 09-19-00459-CV
Court Abbreviation: Tex. App.