SCHUHARDT CONSULTING PROFIT SHARING PLAN, Appellant/Cross-Appellee v. DOUBLE KNOBS MOUNTAIN RANCH, INC., Appellee/Cross-Appellant, 2014 Tex. App. LEXIS 13417

Background

Schuhardt sought to accelerate a real estate note after Double Knobs’ September 2012 payment; Schuhardt purchased the Note and Deed of Trust from Chacon in August 2012 without notifying Double Knobs.
Double Knobs timely paid October 5, 2012, after Schuhardt announced acceleration; trial court later denied some defenses and granted others.
Prior to October 3, 2012, Schuhardt (via Bloxsom) directed payments and communications to mislead Double Knobs about ownership and payment practices.
Sept. 21, 2012 letter and Oct. 2, 2012 text did not clearly constitute notice of default or intent to accelerate; notice failed to provide cure rights.
Court held Double Knobs timely paid under an implied agreement for pre-tenth-day payments; acceleration without proper notice violated the Note and Deed of Trust.
Final judgment: declarations favoring Double Knobs on timeliness/not in default and wrongful acceleration, reversed in inequitable-conduct declaration; attorney’s fees discussed under UDJA and Chapter 38.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether a declaratory judgment was proper to resolve rights under the contract	Double Knobs contends UDJA declarations were appropriate	Schuhardt contends declarations were improper because they resolve fact questions	Yes; declarations of rights were proper where they determined non-default and improper acceleration.
Whether Schuhardt’s actions constituted inequitable conduct	Double Knobs argues inequitable conduct in foreclosing for non-security reasons	Schuhardt argues inequitable conduct is a factual question not suited for UDJA	No; inequitable conduct declaration was not proper as a UDJA declaration and is reversed.
Whether Double Knobs proved breach of contract	Double Knobs performed; Schuhardt breached by accelerating without proper notice	Schuhardt contends it acted within its rights under the Note/Deed and defenses	Yes; Double Knobs entitled to summary judgment on breach of contract and related relief.
Whether Double Knobs could recover attorney’s fees under UDJA and Chapter 38	Fees under UDJA appropriate due to declaratory relief and breach	Fees under Chapter 38 require actual damages; UDJA fee claim limited	UDJA fees valid; Chapter 38 not awarded due to lack of actual damages; UDJA fee award affirmed.
Whether duress or fraud claims survive no-evidence summary judgment	Duress and fraud asserted against Schuhardt	No-evidence shows no material misrepresentation or unlawful threat	No; no evidence supports duress or fraud claims; upheld no-evidence judgment.

Key Cases Cited

Indian Beach Prop. Owners’ Ass’n v. Linden, 222 S.W.3d 682 (Tex. App.—Houston [1st Dist.] 2007) (declaratory relief standards; fact questions separate from rights)
Hill v. Heritage Res., Inc., 964 S.W.2d 89 (Tex. App.—El Paso 1997) (interpretation of contract terms; waiver implications)
BMTP Holdings, L.P. v. City of Lorena, 359 S.W.3d 239 (Tex. App.—Waco 2011) (summary judgment review when competing motions; standard of review)
Ford Motor Credit Co. v. Washington, 573 S.W.2d 616 (Tex. Civ. App.—Austin 1978) (implied acquiescence can waive late payments; course of dealing)
Shumway v. Horizon Credit Corp., 801 S.W.2d 890 (Tex. 1991) (notice to accelerate; waiver requires clear and unequivocal language)
Ogden v. Gibraltar Sav. Ass’n, 640 S.W.2d 233 (Tex. 1982) (clear notice required; failure to give unequivocal notice invalidates acceleration)
Mathis v. DCR Mortg. III Sub I, L.L.C., 389 S.W.3d 494 (Tex. App.—El Paso 2012) (read note and deed together; determine intent to waive notice)
MBM Fin. Corp. v. Woodlands Operating Co., L.P., 292 S.W.3d 660 (Tex. 2009) (declaratory judgment fees; not duplicative; attorney’s fees under UDJA)
Querencia Props., S. de R.L. de C.V. v. New Querencia Capital Partners, L.L.C., 224 S.W.3d 348 (Tex. App.—Dallas 2006) (declaratory judgments not duplicative of contract claims)