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Fletcher v. Edwards
26 S.W.3d 66
Tex. App.
2000
Check Treatment

*1 1. This endorsement if may be used experience rating

the insured’s mod-

ification factor is not available when policy is issued.

2. An appropriate typewritten entry

may made in be the Information

Page using instead of this endorse-

ment. Page

The Information policy

shown in record type-

does not contain appropriate “[a]n

written entry” of the kind indicated. The

summary judgment record not does con-

tain an endorsement an authorizing experi-

ence rating modification that was avail- issued,

able policy when the was on a form

approved by the Commissioner of Insur-

ance, among only “the endorse- permissible

ments for use in affording” compensation

workers’ coverage. Because Department’s poli- official or standard may

cies only by be modified such written

endorsements, say we cannot aas matter

of law that Facility was authorized to

impose the premium additional based on

the experience modifier and corresponding

tabular surcharge.

We reverse the judgment for

the reasons stated and remand cause

to the trial court for further proceedings.

Ralph FLETCHER and D’Ann

Fletcher, Appellants, EDWARDS, al., Appellees.

John R. et

No. 10-98-226-CV. Texas, Appeals

Court

Waco.

July *5 W.

Terry Bradley, Bradley, Keith Brad- Cleburne, ley Bradley, & appellant. for Bonesio, Stephenson, Carol Kuntz & L.L.P., Dallas, appellee. for DAVIS, Before Chief Justice Justice and VANCE Justice GRAY. OPINION DAVIS, D. REX Chief Justice. Ralph and D’Ann Fletcher filed Edwards, Orr, against suit John R. Rob (collectively, ERA & “Ap- Orr Associates pellees”) and alleging statutory others and inducement, common law fraudulent DTPA violations, negligent misrepresenta and Edwards, allege tion. The Fletchers agent, represented a real estate to them could a water get connection to a they ultimately purchased, lot which when not obtain necessary fact could of a connection because lack of easements adjoining granted across an lot. The court summary a judgment favor. Appellees’ рresent following The Fletchers ten appeal: issues in this (cid:127) the “as clauses in the docu- is” with Don- signed ments the seller part L. bargain ald Wallace of the themselves; between Wallace (cid:127) BACKGROUND so, “survive the if did these clauses 5,1991 closing compa- at the title

June Edwards, 4, 1991, real estate June On ny”; ERA, a lot for showed the Fletchers agent day, (cid:127) ERA. That same was listed with severally that jointly and ERA are Orr contract real estate signed the Fletchers alleged represen- for Edwards’s liable Wallace, lot, of the Donald with owner availability concerning tations $16,000 it In this for cash. purchase the Fletchers water to contract, “ac- they obligated themselves to purchased; in its condi- cept[ Property ] the (cid:127) Origi- First Amended Appellees’ was tion.” Original Counter- nal Answer and Declaratory Judgment filed Claim for Edwards parties dispute whether part time to become and served wa- affirmatively to them that represented record; to the lot. The Fletchers ter was available purchased the maintain before (cid:127) Appellees’ does lot, they whether water asked Edwards identify motion the elements The Fletchers was available to lot. for which Fletchers’ causes action Edwards told them that water claim that no-evidence; they claim there is dis- available but that was service was (cid:127) a necessary is reliance element for a had not because the water bill connected law applicable DTPA claim under the further claim paid. The Fletchers been case; them that service that Edwards told water (cid:127) alleged representation was Edwаrds’s they paid if be reestablished could concerning of water so availability *6 Supply Rural Cor- County Johnson Water the “patently absurd” that Fletchers (the $1,400. poration Company”) ‘Water it; upon should not have relied However, that he nev- Edwards maintains (cid:127) the is there evidence that service er told the Fletchers water alleged represen-

relied on Edwards’s told available to the lot and that he was tation; to check the Fletchers that needed and be certain Company with the Water (cid:127) damages, purposes exemplary for is for meter could obtain water Edwards to there evidence intended purchased the lot. the lot before deceive the Fletchers when he made representations; alleged the and “Acceptance of signed an The Fletchers (cid:127) closing on June “Acceptance agreement agreement the of Title” Title” After is” clause. summary in the which contains an “as

properly included the purchase, the Fletchers contacted Appellees record because their service re- to have water Company not it to the Fletchers in Water produce did Company lot. The Water discovery.1 stored to their group pre- separately related of issues these Each issue or 1. The Fletchers list 10 issues separately should be argument briefed. sented in a brief in the “Issues Presented” section correspond summary should The to the issues either as The 38.1(e). In App. brief. See Tex. R. the grouped. listed or "Summary Argument” the section of the to of contents in a brief should refer table brief, they separate provide a and succinct argument page(s) on which the concern- the ing summary arguments for reversal which of 13 group be of issues can each issue correspond or order do not number brief, Appellees As observe in found. 32-page 38.1(g). listed. See id. issues any comply with brief does not the Fletchers’ all "Argument” section of the brief discusses However, requirements. because of these presented together not in the order issues and 38.1(h) for almost brief has been on file Fletchers' table of originally listed. See id. Appellees were able and because months identify subject not "indicate the matter contents does respond to them issues raised and brief, re-briefing page(s) on which require of each issue” or refer will not in their we 2, 38.1(b). See id. 38.9. instance. issue is discussed. See id. eаch (1) told Fletchers that water service was law because: the “as is” clauses4 bar unavailable to their adja- (2) lot because the claims; the Fletchers’ is” “as claus cent lot lacked necessary easements es establish that the Fletchers did not rely required for water Specifically, service. (3) any alleged misrepresentations; and Company the Water informed Fletch- Appellees no duty agents had as Wallace’s ers that the water for meter their lot must investigate “to the actual condition or sta adjacent be located on the lot before water line, tus of the water water easement or begin. service could Company The Water meter.” por water Under the no-evidence stated that without an easement on the motion, tion of thеir claim the Fletch- lot, adjacent they cannot service the produce can no ers evidence that Edwards Fletchers’ lot. alleged knew his concerning statements

The Fletchers subsequently filed suit availability water were false.5 Edwards, Sanborn, Orr, against Beverly support In of their dual Appel- motion ERA, Davis, Clarence C. the Water Com- excerpts lees attached depo- of Edwards’s (1) pany, and claiming: statutory Wallace2 testimony in sition which Edwards claimed inducement; and common law fraudulent (1) that: he did not make affirmative (2) violation of Deceptive Trade Prac- representations to the Fletchers wa- (“DTPA”);3 (3) tices Act and negligent (2) lot; ter was available to he told misrepresentation. prospective buyers job it that was their Appellees originally respond each with Company check ‍​‌​‌​​‌‌​​‌​‌‌​‌‌‌‌​‌‌​‌‌‌‌‌​‌​‌​​​​‌​​‌‌‌‌​​​​​‍the Water and that general ed the Fletchers’ lawsuit with (3) same; he told the Fletchers the he did 19, 1998, May denials. On filed actually know whether water was summary a motion judgment raising for (4) lot; available to the if did he make both traditional judgment claims Fletchers, any representations “no-evidence” claim. See Williams was because he believed water was One, v. Bank Wallace, owner, available because prior App. pet.); no Grant v. — Waco available, him told that water was the lot Co., Southwestern Elec. Power 998 S.W.2d previously it, a septic had tank on he saw a (Tex.App. 387-88 — Texarkana hydrant on water property, and mo- *7 (i). 166a(c), pet.); no Tex. R. Civ. Al bile home been had on the lot for several though distinctly these claims are not as years. The court set the matter for hear- a segregated prefer, as the Court would ing on June 9. reading paragraph close 4 the of motion The their Appellees argue response discloses that Fletchers filed on under their 1. summary judgment They traditional claim that June contest whether Edwards are a judgment entitled to as matter told them they would need to consult with agent 2. "Acceptance Sanborn is an with Davis is the ERA. the its condition” and adjoining through property agreement landowner whose Title” in which likewise the Fletchers needed an easement. The agreed purchasing proper- that subsequently Fletchers ty non-suited their is.” "as Sanborn, Davis, against claims the Water Company, and Wallace. questions 5.The Fletchers’ fifth issue whether portion Appellees’ no-evidence sum Specificаlly, Appel- 3. the Fletchers claim that mary judgment adequately motion identifies false, engaged deceptive in misleading lees elements) of the Fletchers' claims on represented when that acts Edwards water Appellees contend there is evidence. no However, to lot it was available when was not object they did not to form available. Bus. & See Tex. Appellees’ response. motion in their written Code Com. Ann. (Vernon 17.46(b)(5) Supp.2000). § Accordingly, they preserve failed to this issue One, our for review. Williams v. Bank Appellees (Tex.App. rely money no on both earnest — Waco contractually pet.); Indep. contract which the Fletchers accord McConnell Southside in Dist., (Tex.1993). accept property to bound themselves "in Sch. deposition. Appellees the Fletcher’s June Company to determine the Water sup- filed a motion contemporaneously on a their availability of water connection record. summary judgment a plement that he told them and claim of their $1,400. support a They also filed brief membership would cost water (as supple- summary judgment “as challenge use of the motion for They Appellees’ mented) filed on date. The Fletchers clauses by asserting is” clauses such date, the same They response DTPA cases. a applicable supplemental are not arguments re- legal duty raising a to them additional that Edwards had assert original sponse was to the motion. alleged representation that his insure They argue alleged that Edwards’s true. July order on signed an The trial court and and material represеntation was false supplement motion to granting Appellees’ real estate induced them to enter into the on that separate a order the record and The supported contact. Fletchers summary judg- granting same date with an affidavit from D’Ann response specify did The court ment motion. her that Edwards told stating Fletcher granting on which it was ground(s) occa- separate her husband on three and summary judgment, nor did address lot utilities were available sions that ob- summary judgment of the Fletchers’ that Edwards did not tell her husband Strike, or their jections, their Motion to Company before check with Water response. supplemental objected to they purchased They lot. a mo- day, next the Fletchers filed paragraphs Edwards’s two asking permit supplemen- tion the court hearsay grоunds.6 affidavit on judgment summary judgment record tation of the later, filed First days Two response had supplemental with the Original Original Amended Answer and an signed filed on June 26. court Declaratory Judgment. Counterclaim for the mo- granting order on that same date special ex- The amended answer contains tion. portions Fletchers’ ceptions to of the (filed in Original Petition Fourth Amended

1993) generally allegations denies the OF REVIEW STANDARD petition. The counterclaim asserts mo prevail on To adjoining obtained from tion, the movant must demonstrate necessary to fa- landowners easements genuine are no issues of material there 18, 1998. cilitate water service on March as a fact it is and that entitled The Fletchers filed Motion to Strike Co. v. of law. American Tobacco matter filed pleading on June because it was (Tex.1997). Grinnell, 420, 425 sum- *8 days within seven the date of the in disregard all conflicts the evidence We They object- also mary judgment hearing. the non- accept favoring and the evidence March 18 Appellees’ ed to reliance on the Ins. Am. Reserve movant true. Great conveyance Appellees easement because Co., Plumbing Supply Co. San Antonio v. a it copy to in their produce failed (Tex.1965); 41, Kehler v. 391 47 S.W.2d responses. non-suited discovery Appellees 321, (Tex.App.— 324 Eudaly, 933 S.W.2d filing months after their counterclaim two denied). 1996, in writ We Fort Worth it. from the inference dulge every reasonable and 26, ñonmovant a in favor of the Appellees supple- filed evidence On June in its favor. American motion. resolve doubts summary judgment to their ment Tobacco, at 425. D’Ann 951 S.W.2d They еxcerpts from attached years ago objected paragraphs 20-25 6. to two in The Fletchers supplied Wallace had told via a water line that runs which Edwards stated that water was that water before the sale boundary adjacent him some time an lot. along the been installed on line and water meter had 74

A grant trial court sum produce cannot to it in response discovery to their mary judgment on ground not expressly requests. in

presented summary judgment mo Cates, tion. Cincinnati Ins. v.Co. Life Rule of pro Civil Procedure 63 (Tex.1996). 623, 927 Similarly, S.W.2d 625 plead vides that supplemental amended or expressly present “[t]he non-movant must ings may days be filed within seven of trial court, to the trial by written answer or only with leave of court. Tex. R. P. Civ. response, any defeating issues the mov- Rule 63 to applies pleadings filed within аnt’s judgment].” [to entitlement days summary judgment seven aof hear Dist., McConnell v. Sch. Indep. Southside ing as well. v. See Sosa Central Power & 337, (Tex.1993) (citing City 858 S.W.2d 893, (Tex.1995) Light, 909 (per S.W.2d Auth., Houston v. Clear Creek Basin curiam). properly preserve To a com (Tex.1979)). 671, 589 S.W.2d Grounds plaint regarding a pleading which has been by raised in a in party either brief filed trial, filed within seven com days “the support of response, the motion but not or plaining party surprise must demonstrate itself, in the motion response are not to v. request a continuance.” Morse Del by be considered the trial Id. at court. 378, gado, 975 (Tex.App.— 340-41. pet.); Waco no accord Louisiana & “When the trial court does not Ry. Blakely, Ark. 773 S.W.2d specify summary judg for its basis denied). (Tex.App writ . —Texarkana ment, appealing party must show is ground on any error to base it in asserted allegеd surprise The Fletchers’ in Doe, Star-Telegram, the motion.” Inc. v. Appellees’ motion to strike amended (Tex.1995). We con However, pleading. they did not request only grounds sider those “the movant actu Accordingly, continuance. we conclude ally presented to trial court” in the preserve have failed appel to for Ins., motion. Cincinnati Life late complaint plead review their that the at 625. We grounds do not consider ing days was filed within seven of the expressly present non-movant failed to summary judgment hearing. See id. the trial court response. a written Therefore, we overrule their fourth issue. McConnell, 343; Tex. R. Civ. 166a(c). If the non-movant fails to re The Fletchers’ filed a brief motion, spond summary judgment to a day before the hear “the non-movant is limited appeal ing objectiоns raised arguing legal sufficiency produced by documents sup grounds presented by the movant.” plemental discovery responses. These McConnell, (citing 858 S.W.2d at 343 Clear objections appear go Appellees’ late 678). Auth., Creek Basin 589 S.W.2d at production easements which the per obtained ‍​‌​‌​​‌‌​​‌​‌‌​‌‌‌‌​‌‌​‌‌‌‌‌​‌​‌​​​​‌​​‌‌‌‌​​​​​‍in March 1998 THE SUMMARY JUDGMENT objections mit a water connection. RECORD do stated in the Fletchers’ brief not iden *9 argue Fletchers their fourth is- tify agreement of Title” “Acceptance the Appellees’ sue that amended and answer document, as a and rec late-disclosed the counterclaim should not be included in the ord does not reflect that the court ruled judgment record summary Appel- because objections. Accordingly, on their we con days lees within of the hear- filed seven preserve clude that have failed to ing. They tenth contend their issue this our See Tex. R. issue for review. agreement that the of Title” “Acceptance 33.1(a). Thus, we overrule their App. properly summary is not included the judgment tenth record because failed issue.

75 accept property the bound themselves “AS THE IS” CLAUSES construe condition.” We present “in its challenge in only Fletchers’ the purchase agreement this be an response to the Levine, 911 v. “as is.” See Smith property that such “as their assertion is” clauses 427, (Tex.App. Antonio 431 S.W.2d See — San apply do in DTPA suits. clauses not denied). 1995, “Acceptance In the writ Petrila, 688, Wyatt 685 v. 752 S.W.2d expressly the Fletchers agreement, Title” denied) 1988, writ App. Corpus Christi — “they accepted] acknowledged that Barnes, 598, v. S.W.2d (citing Weitzel 691 [sic]” in its IS’ conditions ‘AS (Tex.1985)). However, they dо not 601 and: argument in their on present brief Therefore, appeal. we will not consider it. Seller, Real Estate that neither Beadle, Bonham State Bank v. 907

See Brokers, or BURLESON Agents or 465, (Tex.1995); 470 San Jacinto S.W.2d COMPANY, TI- TRW & TITLE LAND Duke, 209, 209- Auth. v. River COMPANY, OR TLE INSURANCE curiam). (Tex.1990) (per 10 COM- TITLE INSURANCE ALAMO any have war- made PANY OF TEXAS Because the Fletchers’ as representations [sic] or ranties response does not otherwise judgment prop- condition of the above-referenced on “as is” challenge Appellees’ reliance undersigned accordingly, and erty, clauses, challenge only can on appeal harm- and hold them Purchasers release as a legal sufficiency of the clauses liability regard all from and less McConnell, judgment.7 for See 858 basis to the same. 343; Auth., at Clear Creek Basin S.W.2d 678; Camp, 589 v. 972 Camp S.W.2d agree an is” Generally, “аs 906, (Tex.App. Corpus S.W.2d 908 — essential negates the causation ment denied); 1998, v. Alta pet. Christi Colvin fraud, violation,8 and recovery for a DTPA Resources, Inc., Mesa S.W.2d Ins. Am. Prudential Co. negligence. (Tex.App. writ [1st Dist.] — Houston Assocs., 156, 161-62 Jefferson denied). Accordingly, we now examine (Tex.1995). However, agreement an such Ap- whether the “as is” clauses establish who is induced buyer will not bind a mat pellees’ entitlement to as a a because of fraudu agreement enter the Auth., ter law. Basin See Clear Creek par Id. at 162. The representation. lent 679. 589 S.W.2d at in away this fraudulent ties can contract agreement exception if is” Appellees argue that the “as ducement parties’ intent effectively “clearly expresses Fletch- clauses bar each ... inducement claims causes In earnest mon waive fraudulent ers’ of action. about contract, representations rebanee on ey contractually disclaims applies to the Fletchers' of the DTPA 7. issues re- version The Fletchers’ first second require showing of reli- question "as not spectively whether the is” claus- claim and does 16, 1979, Leg., part bargain May 66th es were a or survived See Act of ance. However, 603, 4, R.S., closing. presented these § first Tex. Gen. Laws ch. (amended 1995) (current grounds to the trial court in late-filed version 1329-30 17.50(a) (Vernon response. they did supplemental § Because Ann. Bus. & Com. Code Tex. Nevertheless, grounds Supreme to the trial court these Supp.2000)). fashion, assign "may timely not later an "as Insurance that Court held in Prudential City appeal.” See Hous- them error ele- negates "producing cause” is” clause Auth., Creek Bаsin ton v. Clear 671, brought under claim ment of DTPA (Tex.1979). Accordingly, we 678-79 Am. v. act. Prudential Ins. Co. Jeffer- (Tex.1995). the Fletchers’ first and second issues. Assocs., overrule son Therefore, sixth of the Fletchers’ resolution unnecessary to the is immaterial issue questions whether Fletchers’ sixth issue *10 The appeal. Tex R. disposition of See final they the version of must show reliance under 47.1. 1979 applicable to this case. The App. the DTPA 76

specific matters in dispute.” Schlumber induced to agreement. enter this We dis Swanson, ger Technology Corp. v. agree. allege 959 in peti The Fletchers (Tex.1997). 171, 181 S.W.2d representa tion that Edwards made the “to tions induce them enter into the agent party of a to an “as is” real Their estate contract.” contract it may agreement rely the agreement in they accepted self thаt proper states the defense claims against asserted the (i.e., is”). ty present “in its condition” “as by agent party agreement the other to the Smith, See 911 at If S.W.2d the agent’s because the principal “obviously fraudulently Fletchers were induced to included in agreement the contract terms they enter the real estate contract as al agent.” intended to benefit its AC & lege, that fraud vitiates all documents Invs., Inc. v. Corp., Bonnet Resources the part Fletchers executed as a 258, S.W.2d 264-65 (Tex.App. — Dallas Ins., the transaction. See Prudential 1997, denied); pet. accord Airborne (court at S.W.2d must consider the Enters., Freight Corp. v. Lee C.R. “nature of the and totality transaction 289, 1992, (Tex.App. Paso — El surrounding of the circumstances denied). writ agreement” to determine whether an “as The parties аgree Appellees that enforceable); agreement is” see also agents are of Wallace. The Fletchers Baldwin, Parkway ECC Joint v. Venture signed a contract with Wallace agreeing to 504, 765 S.W.2d 512 (Tex.App . —Dallas buy “in property its condition.” denied) (fraudulent 1989, writ failure to They signed and Wallace agree second height disclose restriction actionable de ment which declared unequivocally spite subsequent conveys deed which “they accepted] its property “subject to ... restrictive cove ‘AS IS’ conditions [sic]” that none of record”); ... of nants accord Munawar “made warranties or Co., 12, v. Cadle 17 (Tex.App. representations as the condition of [sic] 1999, pet.). —CorpusChristi no property.” above-referenced that, dissent believes because thе Appellees, agents, may Wallace’s rely contractual provisions issue agreements. on these Id. agree Such Fletchers’ are case similar to the ones at generally negate ments will the causation in Schlumberger Technology, issue types elements of claims by asserted respectful- same result should follow. We Ins., the Fletchers. Prudential 896 ly disagree because the circumstances sur- However, S.W.2d at 161-62. the Fletchers rounding provisions provi- these and the allege fraudulently were induced sions markedly themselves are distinct. agreement by to enter the Edwards’s al Schlumberger Technology, parties In If leged misrepresentations. were so in a dispute regard- had become embroiled induced, agreement then the would not be feasibility ing project and value of binding on оr preclude them them from they pursuing joint were in a venture. See 162; Partners, recovery. Id. SMB Ltd. Corp., Tech. Schlumberger 959 S.W.2d at Osloub, v. 371 (Tex.App. dispute, parties 180. To resolve this —Houston no pet.); [1st Dist.] Pairett signed negotiations entered a release. Gutierrez, During the negotiations, the course of denied). App. pet. — Austin “highly competent legal and able counsel Appellees argue excep represented parties.” Id. The both dis- tion in Prudential Insurance for fraudu case expressly claimer referenced lent not apply fully inducement claims should the fact that the Swansons’ counsel “Acceptance legal consequences to the “as is” clause in the explained to them the agreement Title” because the Fletchers release. Id. The later Swansons fraudulently Schlumberger Technology do not assert that sued alleging

77 (cid:127) misrepresentation; to a material fraudulently had induced them that it agree to the release. (cid:127) false; which was stated, “The contract and The Court (cid:127) false when to be which was known surrounding circumstances its formation recklessly a as made or was made of reli- determine whether disclaimer knowledge positive assertion without (emphasis at 179 binding.” ance is Id. truth; itsof added). considering parties After that (cid:127) upon; acted was intended be dispute were to resolve attempting (cid:127) upon; which was relied release, by negotiating executing (cid:127) injury. which caused counsel, represented dealing were by “sophisticated length, at arms and were Morris, Am. 981 Co. N. v. Insurance players,” business ‍​‌​‌​​‌‌​​‌​‌‌​‌‌‌‌​‌‌​‌‌‌‌‌​‌​‌​​​​‌​​‌‌‌‌​​​​​‍the Court concluded (Tex.1998). 667, 674 S.W.2d binding. was Id. at disсlaimer a statu plaintiff A establishes 179-81. under tory inducement claim fraudulent es- signed real When the Business and Com 27.01 of the section Acceptance tate contract and the of Title by showing: merce Code agreement, attempting were not (cid:127) of a material representation a false dispute resolve the about fact; availability rep- water. were not They (cid:127) person to enter made induce a counsel, nor were “so- by resented contract; and phisticated players” business were the Swansons. we conclude that Accordingly, (cid:127) entering by person in relied on satisfy agreements this case do not the contract. requirements set forth in either 27.01(a)(1) § Tex. & Code Ann. Bus. Com. Schlumberger Technology preclude (Vernon 1987); v. Reata Oil & Gas Brush Id. fraudulent inducement claim. at 181. 720, (Tex.App.— Corp., 984 726 S.W.2d Thus, agreements we conclude that the do denied). 1998, statutory pet. Waco not Appellees’ establish entitlement from the common cause of action differs Fletch- judgment as a matter of law on the require proof only law “does not statutory ers’ and common law fraudulent knowledge as a prereq or recklessness Ba- inducement claims. See Creek Clear damages.” of actual recovery to the uisite Auth., sin 589 S.W.2d 679. 726; Brush, Diversified, S.W.2d 717, Walker, 702 v. Inc. FRAUDULENT INDUCEMENT 1985, writ ref'd App. [1st Dist.] — Houston law, a plaintiff the common Under n.r.e.). claim establishes a fraudulent inducement do not contest simple parties by showing the elements of “a made, Ramos, if are material. Balogh representations, fraud claim.” v. alleged rep disagree that the 696, They do not (Tex.App. Corpus — denied) that the Flеtchers reh’g), resentations are false or pet. (op. on Christi — by the denied, damaged degree some U.S.-, have been S.Ct. cert. (1999) not available to (citing fact that water was 145 L.Ed.2d 57 DeSantis purchase. Appel- at the time of Corp., Wackenhut (Tex.1990) motion does lees’ (op. reh’g)). Those elements intent9 element challenge are: law, represen- declarant made em- of whether the the common this element Under inducing person purpose [a] "for question the declarant tation of whether braces & Com. representation to enter into contract." his false be acted intended that Tex. Bus. 1987). (Vernon Morris, 27.01(a)(1) Ap- § Co. N. Am. v. upon. See Insurance Code Ann. appeal (Tex.1998). first time on pellees for the sec- remark Under 27.01, no "of contains evidence question that the record the element embraces the tion *12 Fletchers’ claims. See knowledge Cincinnati of the truth. Insurance Co. Life of Ins., Thus, Am., at dispute 674; Brush, 927 S.W.2d the N. at 981 S.W.2d in this case revolves around the elements at 726. S.W.2d knowledge of and reliance. The portion traditional of Appel- summary judgment lees’ motion relies al KNOWLEDGE/RECKLESSNESS exclusively most on the “as is” clauses to determined, already As we have a care- judgment establish their entitlement to as reading ful of portion the no-evidence of a matter law. already of haveWe conclud Appellees’ motion their reveals contention ed that these do not clauses entitle them to that there is no evidence Edwards knew of because alleged representations that his false. were Fletchers’ fraudulent inducement claims. only response Fletchers’ to this asser- Thus, Appellees to an failed establish enti tion in their summary judgment pleadings judgment tlement to aas matter of law on is: “Whether knew or [Edwards] not is not the recklessness element of the Fletchers’ question.” response We construe this common law fraudulent inducement claim. to be a that knowledge statement is imma- Auth., Clear See Creek Basin 589 S.W.2d terial under section 27.01. at 679. The Fletchers are correct that under Similarly, the portion no-evidence of Ap- 27.01, knowledge section immaterial summary pellees’ judgment motion chal- Brush, recovery damages. of actual lenges only knowledge element of the 726; Diversified, S.W.2d 702 S.W.2d Fletchers’ common law claim. According- however, at 723. Under the common law ly, Appellees failed to allege demon- the Fletchers must establish either that strate that no to support evidence exists Edwards alleged representations knew the the recklessness of element the Fletchers’ were false or he recklessly made them common law fraudulent claim. inducement positive assertions without knowledge of 166a(i). Tex. R. Civ. P. See Am., the truth. N. Insurance Co. 674; Brush, S.W.2d at 984 S.W.2d at 726. RELIANCE in Appellees aver sum- no-evidence mary judgment motion that Edwards did in eighth Fletchers contend alleged not know representations fact ques- issue that a issue exists on the false. The presented Fletchers no sum- tion of relied whether on Edwards’s mary judgment alleged evidence counter this representations. Appellees rely on situation, Ordinarily assertion. in this the “as is” clauses assert grant precluded trial court has no discretion but “are as a matter of Williams, motion. no-evidence See 15 law from under recovering their common 117; 166a(i). statutory Tex. R. Civ. In law fraud ... [or] fraud claims.” however, however, question this case of knowl- As stated above an “as is” clause edge wholly does not dispose the Fletch- will not bar claim fraudulent inducement ers’ common fraud claim. The Fletch- “clearly expresses parties’ law unless it may ers also if intent waive prevail show fraudulent inducement recklessly alleged rep- Edwards made the claims or ... disclaims on repre- reliance resentations as positive specific assertions without sentations about matters dis- Reaves, part effort on the See Co. v. Defendants to Dallas Farm Mach. 158 Tex. fraudulently agree 10-13, (1957). induce Fletchers to 238-40 ” purchase subject property 'as is.' To the poten Becausе did first this extent fraud the execution of a con court, ground recovery tial to the trial we theory recovery tract is a than different appeal. will not consider it on See Cincinnati contract, fraudulent inducement to enter that Cates, Ins. Life ground to raise as a failed 1996). granted. could be 27.01(c) provides Section representations. Schlumberger Technology, pute.” exemplary damages recovery of already deter- for the at 181. We have repre the declarant makes is” cases where provisions mined that “as *13 of its “with actual awareness” require- either of the sentation case do meet Technology. falsity. in Schlumberger ments stated Ann. Tex. Bus. & Com. Code (Vernon 1987). Thus, 27.01(c) For common provisions preclude § these do not fraud, from their fraudulent must establish pursuing Fletchers law the Fletchers inducement claims. malice10to recov that acted with Edwards Int’l, damages. LaChalet exemplary er in sum The Fletchers assert their (Tex. Nowik, 101, 106 Inc. v. 787 S.W.2d relied mary judgment response that writ); 1990, no v. App. Gardner — Dallas D’Ann representations. on Edwards’s (Tex.Civ. 795, 796 Kerly, 613 S.W.2d Fletcher’s affidavit recites Edwards writ). 1981, no App. [14th Dist.] — Houston was asked three times whether utilities applicable of DTPA Under the version property. Resolving were available to the case, court award to this the trial can non-movants, all inferences in favor only upon finding a damages additional Appellees failed to estab we conclude “that of the defendant was the conduct as matter law the Fletchers lish May knowingly.” committed See Act alleged repre on rely did not Edwards’s R.S., 603, 4, 16,1979, § 1979 Leg., 66th ch. Tobacco, 951 sentations. See American (amended 1995) 1327, Tex. Laws 1330 Gen. 425. sustain Accordingly, S.W.2d at we (current Bus. & version at Tex. Code Com. eighth the Fletchers’ issue. (Vernon 17.50(b)(1) Supp.2000)). § Ann. fact on Because issues remain reliance, issue of we need not address the summary judg In Fletchers’ regarding seventh Fletchers’ issue they argue only that response, ment alleged “patent absurdity” of Edwards’s knowledge is irrele question of Edwards’s representations. have failed damages recovery their of actual vant to establish entitlement to They 27.01. did not other under section a matter of law on element of the argument wise evidence or statutory common Fletchers’ law challenge Appellees’ asser trial ‍​‌​‌​​‌‌​​‌​‌‌​‌‌‌‌​‌‌​‌‌‌‌‌​‌​‌​​​​‌​​‌‌‌‌​​​​​‍court fraudulent inducement claims. Clear See no Edwards tion there is evidence Auth., Creek Basin 589 at 679. S.W.2d alleged knew were rеpresentations his Appellees similarly or es allege failed Thus, do not consider these false. we support tablish that no evidence exists to McConnell, 858 arguments. See the recklessness element of the Fletchers’ common law P. claim. See R. Crv. Tex. 166a(i). Therefore, presented no evi- trial court erred Because Fletchers granting argument Appellees’ them a to counter dence or these claims. there no Ed- contention that is evidence representations alleged knew his

wards EXEMPLARY DAMAGES false, had the trial court no discretion on the issue grant Appellees’

The in their but motion question Fletchers Williams, damages. 15 judg exemplary See ninth issue whether the 166a(i). 117; Tex. R. Civ. ment evidence raises fact issue on the S.W.3d the Fletchers’ Accordingly, we overrule Edwards intended to questiоn whether alleged he ninth issue. deceive them when made the 795, (Tex. Kerly, may wrongful 613 S.W.2d from Gardner v.

10. "Malice be inferred 1981, no par Civ.App. [14th intentionally Dist.] of [a act done violation — Houston Nowik, Int’l, writ)); Inc. v. ty’s] rights.” accord LaChalet Accent Co. Southwest Bldrs. 1990, 101, 106, Inc., (Tex.App. Sys., 787 S.W.2d Concrete 679 S.W.2d — Dallas 1984, writ). n.r.e.) no App. (quoting writ ref'd — Dallas Auth., Inc., AND JOINT SEVERAL LIABILITY Educ. denied). (Tex.App. pet. — Waco question issue ERA third whether Orr and are GRAY, dissenting. Justice

jointly severally hable for Edwards’s See, alleged representations. e.g., Nati GRAY, Justice, dissenting. TOM onsBank, Dilling, N.A. v. (Tex.1996); Tipton, 952-53 Roberts v. majority opinion is an excellent dis- (Tex.Civ.App. presented cussion the issues this ap- — Waco n.r.e.). 1978, writ ref 'd Appellees respond peal. The analysis thoughtful and well *14 only they that because believe “the Fletch- However, presented. after pondering the genuine ers failеd to raise of issues materi cases, presented, issues review of the Edwards, al on against fact their claims analysis of considering the facts and the of liability against issues vicarious Orr and the scope application opinion of the to ... ERA are moot.” Orr and ERA did situations, opinion am similar I of the that allege judgment an entitlement to on signed by the written contract the Fletch- summary in ground judgment this their precludes recovery by them. If ers writ- Thus, motion. the trial court could not ten mean if anything, contracts are to summary granted judgment have them a are to their going citizens conduct lives ground, on this and we cannot consider provided by under the assurance written Ins., on appeal. See Cincinnati 927 agreements, willing we be to should en- Life Accordingly, we will not require force them and to peoрle by live further the address Fletchers’ third issue. they signed those documents have which agreements by they

as solemn are bound. CONCLUSION signed In this case the Fletchers a writ- allege they The Fletchers were agreement expressly ten stated that:

fraudulently to the induced enter transac- so, Appellees. tion with If the “as is” they accept the in its “AS IS” binding clauses issue would not be ... conditions that neither the [and] preclude them or them from recovering on Seller, Brokers, Agents Real or Estate However, any claims. LAND & TITLE BURLESON demonstrated that are entitled to COMPANY, TRW TITLE INSUR- as a judgment matter of law on the Fletch- COMPANY, TI- ANCE OR ALAMO exemplary damages ers’ claim for under TLE INSURANCE COMPANY OF 27.01(c), A, DTP section the and the com- any TEXAS have made warranties or Otherwise, Appellees mon law. failed to representations as the condition of the judgment establish their entitlement to property, above-referenced and accord- a matter of law on the Fletchers’ claims. undersigned ingly, Purchasers re- lease and hold them harmless from affirm portion summary We of the liability regard all to the same. granted on the Fletchers’ claims exemplary damages to is question for under section The for us decide whether 27.01(c), DTPA, and the common law. as a matter of law agreement negates portion upon alleged We reverse the Fletchers relied that the judgment granted majority on the remainder of Edwards. The representations sever, claims, por opinion and remand that holds that because the Fletchers alleged regarding tion of this cause to the trial court for statement avail- in- proceedings ability further consistent with this water was fraudulent and contract, opinion. Energy, See v. to into Aero Inc. Circle C duced them enter Co., Drilling it vitiates the written contract. ma- 1985); Blankenship Higher jority upon Schlumberger. v. relies opinion Brazos induced sell their fraudulently were Technology v. Swan Schlumberger Corp. (Tex.1997). son, 171, 180 project. sea-diamond interest However, reading a close Schlumber- Technology Corp. Swan Schlumberger (Tex.1997)(em- son, above disclaimer of ger reveals that made any representations by reliance on phasis quoted). as in text (the Agents Real or Bro- Edwards Estate Here, complain do not the Fletchers kers) remarkably one similar appellees sign duped by the Texas Court held be effective Supreme that was in fact a contract something Schlumberger. explained: The Court do buy property. of real Nor tract language, In this context and clear allege opportunity did not have the unequivocally disclaimed Swansons review, prevented reviewing, or were from upon representations by reliance They do not they signed. the documents project’s feasi- Schlumberger about prop- one tract of allege they were shown bility They and value. said: erty in fact the contract and deed but They bought another. tract described [Ejach expressly us [the Swansons] *15 they shown. property were and does represents warrants state ... and ... hereby represent a contract signed The Fletchers promise agreement that no or which is relying any repre- they said were not on expressed not has herein been made appellees made the condi- sentation about release, executing to him her in or this suing, are property. tion of the Now relying upon and that none of us is fraudulently induced to claiming were representation statement misrepre- buy of a property because any agent parties being of the re- prop- condition of the sentation about the hereby. relying leased Each of us is strength similarity of the erty. Upon on or her own and each his of reliance Schlumber- disclaimer represented by has Hubert been signed ger with the disclaimer reliance legal as counsel in this mat- Johnson Fletchers, Supreme until by the legal ter. The aforesaid counsel has what Court clarifies under circumstances explained ‍​‌​‌​​‌‌​​‌​‌‌​‌‌‌‌​‌‌​‌‌‌‌‌​‌​‌​​​​‌​​‌‌‌‌​​​​​‍read and to each of us the must and what evidence the non-movant Full, entire contents of this Release summary judgment record to place in the legal as as the consequences well summary judgment, avoid I would hold added). (emphasis this Release .... binding that the disclaimer of reliance courts are to assume that the Because law, and, a matter of precludes as provi- intended parties every contractual fraudulent- Fletchers’ claim that meaning, sion to have some see Colum- by any ly buy induced to Gas, 591; Lenape bia by Appellees. made representation Pipe- Corp. v. Tennessee Resources Gas I affirm the trial Accordingly, would Co., (Tex.1996), line summary judgment. Because the court’s con- presume parties we must not, respectfully I opinion does majority templated, by inclusion of this dissent. clause, rely Swansons would Schlumberger any representations feasibility and val- about the commercial which, all, was project,

ue after dispute the release was very Therefore, to resolve. we con-

supposed

clude that the disclaimer of reliance is law, and, pre-

binding a matter of claim that the Swansons’

cludes

Case Details

Case Name: Fletcher v. Edwards
Court Name: Court of Appeals of Texas
Date Published: Jul 5, 2000
Citation: 26 S.W.3d 66
Docket Number: 10-98-226-CV
Court Abbreviation: Tex. App.
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