Lead Opinion
OPINION
Gordon Westergren sued two individuals and a limited partnership, alleging breach of contract with regard to an oral agreement, breach of partnership duties, statutory fraud, and common-law fraud. Defendants National Property Holdings, L.P., Michael Plank, and Russell Plank (collectively, the “Plank Parties”) counterclaimed, alleging breach of contract with regard to a settlement agreement and a release. The jury rendered findings favorable to Westergren and adverse to the Plank Parties. The trial court rendered judgment that the parties take nothing on their respective claims. On appeal, West-ergren asserts that the trial court erred in rendering judgment he take nothing, in denying him leave to amend his petition during trial, and in awarding court costs to the Plank Parties. On cross-appeal, the Plank Parties argue that the trial court erred in rendering judgment they take nothing. We affirm in part, reverse in part, and remand for limited proceedings.
I. Factual and Procedural Background
Appellant Gordon Westergren, a lifelong resident of LaPorte, Texas, wanted to purchase and develop certain real property in LaPorte, specifically, 190 acres on the east side of Powell Road. These 190 acres are situated along a rail line between two shipping terminals. Westergren entered into a purchase option contract with the owners of the 190 acres. The owners later entered into two additional purchase option contracts on the same 190 acres. In July 2004, Westergren filed suit (“the 190-acres litigation”) against the owners and the two other parties who claimed an option to purchase the 190 acres, asserting that he
While the 190-acres litigation was pending, Westergren met the Planks. Specifically, Walter Johnson, then CEO of Ame-gy Bank, had participated in several “handshake” transactions with Westergren in which Johnson served as the financial partner while Westergren “found and sourced” property deals in the LaPorte area. Although Johnson was not interested in purchasing and developing the 190 acres, Johnson introduced Westergren to two brothers, Michael Plank and Russell Plank, who were clients of the bank. Michael Plank is the President of the corporate general partner of National Property Holdings, L.P. (“NPH”), a Texas limited partnership involved in real estate development. Russell Plank performs consulting services for various companies, including NPH. Several developers, including NPH, were interested in purchasing and developing the 190 acres.
In January 2005, after Westergren met the Planks, Russell Plank contacted Robert Langston, the attorney representing Westergren in the 190-acres litigation. Russell Plank called Langston about paying Westergreris attorney’s fees. Lang-ston asked Russell Plank why he would do that for Westergren; Russell Plank responded “[b]ecause we’re going to be partners.” Langston then received a $5000 check from NPH
Although the Plank Parties were not parties to the 190-acres litigation, Russell Plank, sent by Michael Plank on behalf of NPH, attended a mediation involving the litigation parties in August 2005. Wester-gren and Langston attended the mediation. At this mediation, NPH agreed to pay out cash settlements to all the litigants, except Westergren, for their claims on the 190 acres. At the mediation, according to Westergren and Langston, Russell Plank promised that, in exchange for Westergreris release of his lis pendens and the settlement of the 190-acres litigation, Westergren would become a partner of the Plank Parties and would receive $1 million cash and an interest in profits (the exact percentage to be negotiated) from the purchase and development of the 190 acres. Westergren testified that at the mediation Russell Plank said, “Don’t worry about it, Gordon. Let’s get these guys out of the way, and we’ll get it handled.”
Langston repeatedly requested of both Russell Plank and Westergren that the parties reduce their partnership deal to writing. In October 2005, Russell Plank presented Westergren with a profits interest agreement drafted by appellees’ attorneys. This draft agreement stated that Westergren was to provide consulting services in exchange for a 5% profit interest in funds distributed by NPH. Russell Plank then crossed out the 5% term and hand-wrote 10%, then 20%. This agreement was not signed.
In January 2006, NPH and the parties to the 190-acres litigation entered into a Mediation Settlement Agreement (“MSA”). NPH was a signatory party to the MSA. Neither Michael Plank nor Russell Plank individually was a signatory to the MSA. In the MSA, NPH agreed to purchase the 190 acres in dispute; Westergren and the other parties to the litigation agreed to
According to Westergren, at the time that he agreed to sign the MSA, he did so in reliance upon the oral partnership deal with NPH, Michael Plank, and Russell Plank:
[The Plank Parties] were going to pay me a cool million bucks for signing off, letting them have control of the property, and give me a 5 percent interest in the 190 acres. That’s what caused me to give them control of the property.
Westergren further testified that the “final” deal at the time he agreed to “sign away” his lis pendens was “a million in cash and a 5 percent[ ] — a 5 percent profits participation.”
After the mediation, because 190 acres was more land than the Plank Parties were comfortable purchasing and developing, the Plank Parties held meetings with various companies to serve as potential partners, including ML Realty Partners, a Chicago-based investment and development company interested in long-term real estate holdings. In January 2006, NPH entered into a contribution agreement with ML Realty Partners. Under this agreement, upon NPH’s acquisition of the entire 190 acres, ML Realty Partners would distribute $6 million to NPH.
On February 14, 2006, Westergren released his lis pendens and dismissed his claim in the 190-acres litigation with prejudice. Two days later, NPH purchased 20 of the 190 acres, and Port Crossing Land, L.P., a limited partnership in which the limited partners were an NPH-affiliated entity
At this time, Westergren still had not received any payment from the Plank Parties, and started calling them. According to Westergren, Russell Plank finally told him, “Look, we can’t give you the whole million right now but we’re going to give you a half a million bucks.” Both Michael Plank and Russell Plank testified that they agreed to pay Westergren $500,000. Westergren met with Russell Plank at the NPH office on June 80, 2006, at which time Russell Plank gave Westergren a check for $500,000.
In February 2007, Westergren sent a letter to Michael Plank to request the other $500,000 and his “5% interest.” West-ergren and Michael Plank then met for lunch. Westergren testified that, during lunch, he found out about the Release and Michael Plank told Westergren “you need to read what you sign.” The Plank Parties refused to pay Westergren any additional compensation. Westergren filed suit against the Plank Parties, asserting various claims, including breach of contract, breach of partnership duties, common-law fraud, and statutory fraud. The Plank Parties filed a counterclaim asserting that Westergren breached the MSA and the Release by filing suit.
After a trial, the jury found the following:
• Russell Plank agreed to pay Wester-gren $1 million and a 5% profit interest in the development of the 190 acres in exchange for Westergren’s releasing his lis pendens and giving up his contractual right to the 190 acres.8
• Russell Plank failed to comply with this agreement.
• NPH, Michael Plank, and Russell Plank each partially performed the agreement to pay Westergren $1 million and a 5% profit interest in the development of the 190 acres.
• Russell Plank’s failure to comply with his agreement was not excused.9
• The sum of $500,000, if paid now in cash, fairly and reasonably would compensate Westergren for his damages that resulted from Russell Plank’s failure to comply with his agreement, based upon the difference between the amount Wester-gren received from the Plank Parties and the amount Westergren would have received if the Plank Parties had paid him the agreed-upon amount.
• Each of the Plank Parties formed a partnership with Westergren.
• Each of the Plank Parties failed to comply with its respective duty of loyalty to Westergren and with its respective duty of care to Wester-gren. 10
• These failures were not excused by Westergren’s later taking an inconsistent position to the disadvantage of the Plank Parties.
• The sum of $177,608, if paid now in cash, fairly and reasonably would compensate Westergren for his damages that were proximately caused by those breaches of partnership duties, based upon the difference between the amount Westergren received from the Plank Parties and the amount Westergren would have received if the Plank Parties had paid him the agreed-upon amount.
• NPH’s profit in the acquisition of the 190 acres was $3,552,174.
• Each of the Plank Parties committed common-law fraud by misrepresentation, common-law fraud by omission, and statutory fraud against Wester-gren.11
• The fraud by misrepresentation and statutory fraud were not excused by Westergren’s later taking an inconsistent position to the disadvantage of the Plank Parties.
• Zero dollars, if paid now in cash, fairly and reasonably would compensate Westergren for his damages, if any, that resulted from such fraud, based upon the difference between the amount Westergren received from the Plank Parties and the amount Westergren would have received if the Plank Parties had paid him the agreed-upon amount.
• The amount of $200,000 would be a reasonable fee for the necessary services of Westergren’s attorney for preparation and trial; $25,000, for an appeal to the court of appeals; and $20,000, for a petition for review to the Texas Supreme Court.
• Westergren did not fail to comply with the MSA or the Release.
The Plank Parties filed a motion to disregard all the jury findings adverse to them and requested a take-nothing judgment as to all of Westergren’s claims and judgment in favor of the Plank Parties on their counterclaims.
II. Issues PREsented
On appeal, Westergren presents five issues. First, Westergren argues that the
On cross-appeal, the Plank Parties present two issues. First, the Plank Parties argue that they conclusively proved (a) that Westergren breached the MSA and the Release by filing the underlying suit and (b) the amount of their resulting damages, such that the trial court should have rendered judgment in their favor on their counterclaims. Second, the Plank Parties contend the jury’s finding that Westergren did not breach the MSA and the Release was against the great weight and preponderance of the evidence such that the trial court should have granted the Plank Parties a new trial on their counterclaims. In a conditional cross-issue, the Plank Parties also assert that any recovery by Wester-gren must be capped at $200,000.
III. Standards op Review
Judgment against a jury verdict is proper only when the law does not permit reasonable jurors to decide otherwise. City of Keller v. Wilson,
In reviewing factual sufficiency, we must consider and weigh all the evidence. Golden Eagle Archery, Inc. v. Jackson,
IV. Analysis
A. Whether the trial court erred in disregarding the jury’s breach-of-contract findings
The trial court granted the Plank Parties’ motion to disregard the jury findings regarding the breach-of-contract claim without specifying the grounds upon which it relied. Therefore, on appeal, Wester-gren must show that each independent ground fairly asserted against the breach-of-contract claim does not provide a basis for affirming the trial court’s judgment as to this claim. See Fort Bend Cty. Drainage Dist. v. Sbrusch,
1. Westergren addressed all the JNOV breach-of-contract bases fairly presented by the Plank Parties.
As an initial matter, the Plank Parties assert that we can affirm JNOV on West-ergren’s breach-of-contract claim due to Westergren’s alleged failure to address one of the Plank Parties’ alleged JNOV grounds. We disagree. In their JNOV motion, instead of arguing that partial performance is an equitable doctrine under which a party only may recover reliance damages for breach of contract, as they do in their appellate brief, the Plank Parties merely coupled the lack of legally sufficient evidence of partial performance with the lack of a damages question based on reliance damages to argue that all of West-ergren’s damages findings fail (ground 6 above). The Plank Parties did not directly attack the jury’s finding on breach-of-contract damages. In addition, in their JNOV motion, the Plank Parties only cited cases dealing with non-contract causes of action.
While the Plank Parties cited Exxon Corp. v. Breezevale Ltd. in the brief in support of their motion for JNOV, they cited it for the propositions that the partial-performance exception to the statute of frauds was inapplicable and that, because the statute of frauds rendered the alleged oral partnership agreement unen
2. The evidence is legally sufficient to support Russell Plank’s individual liability on the contract.
The Plank Parties did not plead agency
Westergren argues that even if Russell Plank did act at times as an agent for NPH, this does not mean Russell Plank was acting solely as an agent and never at all in his individual capacity when he made promises to Westergren. Westergren contends that the trial record shows Russell Plank wore “multiple hats,” including one as Russell Plank, individual. We agree. Russell Plank admitted that at times he dealt with Westergren as an independent consultant:
Q. When you dealt with Mr. Wester-gren, were you dealing with him as an independent consultant, or were youdealing with him as a representative of National Property Holdings, or were you dealing with him as a representative of the Plank Companies, Inc.?
A. All of the above. I’m a consultant that works for all of those entities.
Russell Plank testified that he was strictly an independent consultant for, and was not a partner and did not have any ownership interests in, Michael Plank’s companies. Russell Plank denied that he had any authority to act on behalf of NPH — “Mike makes all decisions” with regard to NPH. Russell Plank only was authorized to act on behalf of NPH by Michael Plank on “some specific issues.” Michael Plank confirmed that Russell Plank was a consultant for NPH and Westergren was told that. Westergren testified that he dealt extensively with and had been in constant contact by cell phone with Russell Plank; Russell Plank agreed that he spoke to Westergren “much more” than Michael Plank did. Westergren and Langston both testified that their discussions regarding the $1 million and profits-interest “deal” were with Russell Plank. Russell Plank called Langston regarding paying Westergren’s attorney’s fees in the 190-acres litigation because they were going to be “partners.” And Russell Plank admitted that he “personally” wrote a $5000 check to Langston. Westergren further testified it was Russell Plank who called to tell him that it was time to release the lis pendens.
Although Russell Plank at times may have acted as NPH’s agent, an agent is not precluded from binding himself on a contract where he has pledged his own personal responsibility in addition to that of his principal. See Nagle v. Duncan,
Based on all the circumstances surrounding the formation of the contract, there is more than a scintilla of probative evidence that Russell Plank acted in his individual capacity with regard to the oral agreement with Westergren. See Tanner,
3. The evidence is legally sufficient to support that Westergren did not release his breach-of-contract claim under the MSA and the Release.
In their motion for JNOV, the Plank Parties argued that any breach-of-eontract claim was released under both the terms of the MSA and the Release. The jury found that Russell Plank’s failure to comply with his oral agreement with Wester-gren was not excused by any waiver by Westergren. In addition, the jury found that each of the Plank Parties committed fraud by omission. Finally, the jury found no breach of contract by Westergren with regard to either the MSA or the Release.
a. The January 2006 MSA
On appeal, Westergren contends that the MSA did not release any claims against Russell Plank because the MSA fails to refer to Russell Plank with any “descriptive particularity or otherwise,” and thus the Plank Parties’ argument could not have formed the basis for the trial court’s JNOV.
The MSA included the following language:
[A]ll parties to this Agreement agree to release, discharge any and all claims, demands or suits, known or unknown, fixed or contingent, liquidated or unliq-uidated, whether or not asserted in the above case, as of this date, arising from, or related to, the events and transactions which are the subject matter of this case.
While “all parties” to the MSA agreed to release and discharge “any and all claims” related to the “subject matter” of the 190-acres litigation, and NPH was a signatory party to the MSA, there is no dispute that Russell Plank individually did not sign and was not a party to the MSA. Nor does the MSA specifically refer in any way to the parties’ agents; certainly, nothing expressly indicates that the parties to the MSA intended to release Russell Plank from any and all claims.
Moreover, even assuming solely for purposes of our analysis that the MSA would cover claims against agents of signatory parties, we already have concluded more than a scintilla of evidence would support a reasonable jury’s finding that Russell Plank acted in his individual capacity, not solely as an agent for NPH, to be bound personally on the oral agreement with Westergren. See supra Section IV.A.2. Thus, the Plank Parties’ reliance on cases in which releases were found to reach a company’s employees or agents who were clearly acting in the scope of their employment or agency is misplaced.
b. The June 2006 Release
The Plank Parties also argued that Westergren released his breach-of-contract claim under the Release. The Plank Parties complained that Westergren failed to present any evidence of fraud by omission, and therefore, Westergren’s
On appeal, Westergren argues the evidence shows that Westergren’s signature on the Release was procured by fraud and the jury’s findings are consistent with and support Westergren’s fraudulent-inducement defense. Specifically, the evidence shows Russell Plank did not disclose that the document was actually a release; Russell Plank knew that Westergren was ignorant of that fact and did not have an equal opportunity to discover it because he did not have his glasses; Russell Plank induced him into signing the Release by failing to reveal its true nature; and West-ergren suffered injury as a result when the Release was later used as the reason to avoid additional payment. Westergren further argues that the Release does not cover Russell Plank; he is not specifically mentioned in the Release and, at trial, Russell Plank testified that he was “not a party individually” to the Release.
Here, the trial court submitted various fraud questions
Did any of the parties listed below commit fraud against Gordon Westergren?
Fraud occurs when:
a) a party fails to disclose a material fact within the knowledge of the party,
b) the party knows that the other party is ignorant of the fact and does not have an equal opportunity to discover the truth,
c) the party intends to induce the other party to take some action by failing to disclose the fact, and
d) the other party suffers injury as a result of acting without knowledge of the undisclosed fact.
On question 14, the jury answered “yes” with respect to each of NPH, Michael Plank, and Russell Plank. We disagree that Westergren failed to present any evidence of fraud by omission. Russell Plank testified that the Release was drafted by the Plank Parties’ attorneys, not by West-ergren, and Russell Plank read and approved it before having Westergren sign it. Westergren testified that Russell Plank called him and told him that he should come to the NPH office to pick up the first half of the million dollars. Russell Plank was aware that Westergren had “eyesight problems.” Westergren testified that he did not take his reading glasses when he went to pick up his check, that Westergren could not read the document Russell Plank “needed” him to sign, but after Wester-gren asked Russell Plank “[wjhat’s that?”, Russell Plank told Westergren he was signing “nothing,” “just a receipt,” and he did not “have to worry about it.” Wester-gren testified what Russell Plank did not tell him was that the document was a “release of all claims.” Westergren testified he “absolutely” relied on the fact that Russell Plank told Westergren the document was “just a receipt” without telling him it was a release in executing and signing the Release. Russell Plank testified, ‘We put things in [the Release] because we — we just didn’t — we didn’t — Gordon was a loose cannon. We had no idea what he was capable of.” Westergren testified that as he left this meeting, Russell Plank told Westergren he would receive “the other half’ when “we get another building coming out of the ground.” West-ergren did not know that what he signed was a release until he met with Michael Plank who told him “you need to read what you sign” and that he would not pay Westergren “an fing dime” more. West-ergren never received the other $500,000 and 5% profit interest.
In addition, Russell Plank, after working directly with the Plank Parties’ attorneys on drafting the Release, never provided Westergren’s attorney Langston with a copy of the Release before asking Wester-gren to sign it. This is despite the facts that Russell Plank knew Langston represented Westergren in legal matters related to the 190 acres, Russell Plank personally had written a $5000 cheek to pay Wester-gren’s attorney’s fees in connection with the 190 acres, and Langston had “many thousand[s]” of discussions with Russell Plank about putting the oral agreement with Westergren related to the 190 acres — the very reason why Westergren signed the MSA and released his lis pen-dens — in writing. This is also despite the facts that the document Russell Plank conditioned receiving the $500,000 check on was a “professional” attorney-drafted agreement regarding and release of West-ergreris legal claims related to the 190 acres; Russell Plank had his attorneys “put things” in the Release because he “had no idea what [Westergren] was capable of’; and that the custom and practice of communications among attorneys is to deal strictly with the attorney representing “the other guy’s client,” which includes providing that attorney with copies of documents. Langston testified that he was unable to advise Westergren about his le
In their JNOY motion, the Plank Parties cited First City Mortgage Co v. Gillis, for the proposition that Russell Plank had no duty as a fiduciary to disclose the Release’s unambiguous terms and Westergren was obligated as a principal to read the Release before he signed it. See
Here, the evidence indicates that Russell Plank called Westergren in to receive the first half of his “cool million”; presented Westergren with a document “drawn by professionals” and that Russell Plank had approved without first sending a copy to Westergren’s attorney for his review; told Westergren that he “needed” to sign it; after being expressly asked by Westergren what he was signing, told him it was “just a receipt” and did not disclose that it was an agreement and included a release of all claims; and continued to refer to the existence of the oral agreement he had with Westergren even after the Release was signed. From Russell Plank’s actions, a reasonable jury was free to infer he knew and had concealed or failed to disclose the material fact that the document was a release of Westergren’s claims; he knew Westergren did not know that the document was a release and did not have an equal opportunity to discover the truth; he intended to induce Wester-gren to sign the Release by deliberately failing to disclose that fact; and Wester-gren was injured by signing the document without knowing it was a release. In other words, that Russell Plank induced Westergren into signing the Release by committing fraud by omission or nondisclosure. Therefore, based on our review of the evidence in the light most favorable to, and indulging every reasonable inference that would support, the jury’s affirmative finding, we conclude there is more than a scintilla of evidence upon which a reasonable and fair-minded jury could conclude Westergren had proven each of the elements of fraud by omission as to Russell Plank. See City of Keller,
4. The evidence is legally sufficient to support that consideration existed for Russell Plank’s contract with Wester-gren.
In their motion for JNOV, the Plank Parties argued any alleged oral agreement reached after the execution of the MSA fails for lack of consideration.
Generally, a contract must be supported by consideration to be enforceable. McLemon v. Dynegy, Inc.,
Here, Westergren testified that Russell Plank promised to make Westergren his partner and pay Westergren $1 million and a 5% profit interest in the sale of the 190 acres in exchange for Westergren’s promise to release his lis pendens and contractual rights to the 190 acres. West-ergren presented evidence that Russell Plank’s promises induced Westergren, to his detriment, to agree in the MSA to release his lis pendens and his contractual rights to the 190 acres and then to actually release the lis pendens and dismiss the 190-acres litigation with prejudice. According to Westergren, Russell Plank’s promises “caused [Westergren] to give them control of the property” and induced him to “walk away” from the mediation “without getting anything” — “[W]e had a partnership, a deal to march on down. That’s why I took zero.” Langston testified that both Westergren and Russell Plank provided “identical” details regarding their agreement and exchange of promises.
The jury found that Russell Plank agreed to pay Westergren $1 million and a 5% profit interest in the 190 acres in exchange for Westergren’s releasing his lis pendens and giving up his contractual right to the property. Based on our review of the evidence in the light most favorable to this finding, we conclude the evidence at least raised a fact issue as to the existence of consideration, which would allow a reasonable and fair-minded jury to find that a contract existed. See City of Keller,
5. The evidence is legally sufficient to support that the oral agreement entered into by Westergren and Russell Plank did not merge into the MSA.
In their motion for JNOV, the Plank Parties argued that Westergren’s contract claim fails as a matter of law because any agreement reached prior to the MSA merged into and was superseded by the MSA. Westergren argues on appeal that the merger doctrine does not apply because Russell Plank individually was not a party to the MSA.
A “merger clause” is a contractual provision mandating that the written terms of the contract may not be varied by prior agreements because all such agreements have been merged into the new document. IKON Office Solutions, Inc. v. Eifert,
Here, the MSA contains a merger clause: “this Agreement constitutes the entire agreement between and among [the parties], and supersedes any prior or contemporaneous representations, statements, understandings or agreements concerning the subject matter of this Agreement.” However, no merger occurred because the parties to the MSA are not the same as those to the oral agreement. While West-ergren was a signatory party to the MSA, there is no dispute that Russell Plank individually did not sign and was not a party to the MSA. And we already have determined there is legally sufficient evidence to support that the oral agreement at issue was entered into between Russell Plank, individually, and Westergren. Thus, as a matter of law, the oral agreement and the MSA “cannot merge because the two agreements are between different parties.” See Fish,
Viewing the evidence in the light most favorable to the jury’s verdict, we therefore conclude that a reasonable and fair-minded jury was free to conclude that any contract between Westergren and Russell Plank, individually, survived in spite of the MSA. See City of Keller,
6. The evidence is legally sufficient to support the jury’s finding of partial performance.
The Plank Parties asserted in their motion for JNOV that any alleged oral agreement is unenforceable under the statute of frauds because Westergren did not meet his burden to establish the partial-performance exception to the statute of frauds. Specifically, the Plank Parties argued that the evidence conclusively shows Westergren had another reason to release his interest in the 190 acres and the Plank Parties had another reason to pay Wester-gren, such that there was no evidence their conduct was “unequivocally referable” to the alleged oral agreement. The Plank Parties further argued there was no evidence that enforcement of the statute of frauds would amount to a “virtual fraud.”
On appeal, Westergren emphasizes that partial performance is a fact question to be determined by the jury.
Partial performance is an exception to the statute of frauds. Exxon,
The jury found that Russell Plank agreed to pay Westergren $1 million and a 5% profit interest in the development of the 190 acres. The jury further found Russell Plank partially performed that agreement.
Here, Westergren testified that the only reason he agreed to “walk away” from the mediation for “nothing” and sign the MSA was because Russell Plank had promised to make him a partner and pay him $1 million and a 5% profit interest for releasing his lis pendens and claim to the 190 acres. Russell Plank told Westergren “not to worry,” that they just needed to “get these guys out of the way” by way of the mediation and the MSA. Westergren “absolutely” relied on Russell Plank’s promises in agreeing to and later signing away his lis pendens. Langston confirmed, “That’s what [Westergren] did in reliance on the representations that had been made to him,” and that Russell Plank shared these same representations with Langston. As a result of Westergren’s signing away his lis pendens, the Plank Parties “got full control” of the 190 acres. NPH (on its own and through a partnership) was able to purchase the 190 acres, received a $6 million distribution from ML Realty Partners, and resold 20 acres at a higher price for square foot. If Wester-gren successfully had pursued his claim to the 190 acres, he would have “the right to go out and buy the 190 acres.” After Westergren released his lis pendens and dismissed his claim, he requested payment on the agreement. Russell Plank told
a. Whether Russell Plank’s actions are “unequivocally referable” to his contract with Westergren
Considering the evidence in the light most favorable to the jury’s partial-performance finding, we conclude that Westergren raised a fact issue on whether Russell Plank’s actions were unequivocally referable to their oral agreement. The fact that the $500,000 check was drawn on NPH’s bank account is not dispositive because there was clear evidence it was Russell Plank who “pushed” his brother to “try to get [Westergren] paid.” See Book-out,
In addition, that NPH’s accounting notation on the check later was changed from “Land-Fixed Asset” to “Consulting Fees” does not necessarily mean Russell Plank’s conduct in connection with the payment is equally referable to some other contractual arrangement with Westergren. See id. (explaining that jury was free to conclude that check payments at issue were evidence of partial performance on contract to purchase chiropractic clinic “notwithstanding the way in which they were marked”). Instead, the evidence indicates NPH did not believe it had any agreement to pay anything to Westergren, for consulting or his “time and effort related to the [190 acres].” The October 2005 draft profits interest agreement, presented to Westergren by Russell Plank, that mentioned Westergren’s providing consulting services for NPH was never signed. Nor did NPH consider Westergren its consultant. Russell Plank indicated Michael Plank was “adamant” Westergren not be paid because “[h]e didn’t understand why we had to pay Gordon anything.” And Michael Plank specifically admitted “we never had a contract with [Westergren] for anything.”
b.Whether Westergren’s actions are “unequivocally referable’’ to his contract with Russell Plank
To the extent the Plank Parties also argued that Westergren’s actions were not “unequivocally referable” to his contract with Russell Plank, we also conclude Westergren raised a fact issue as to whether his own actions were unequivocally referable to their oral agreement. There is direct testimony from Westergren and Langston that Russell Plank’s representations induced Westergren to sign the MSA. While the MSA contained a merger clause, we already have determined that no merger occurred as to Russell Plank individually. And the MSA’s reliance disclaimer would not apply to any representations by Russell Plank individually.
c. Whether 'permitting Russell Plank to escape liability would amount to a “virtual fraud”
We also
d. Here, the jury was free to determine whether the partial performance exception applied.
Based on our review of the evidence in the light most favorable to the jury’s findings, we conclude more than a scintilla of evidence exists to support that the parties’ performance here sufficiently established the partial-performance exception to the statute of frauds. See Tanner,
7. The evidence is legally sufficient to support the jury’s damages finding on breach of contract.
As discussed supra in Section IV. A.1, the Plank Parties urged in their JNOV motion that because there is no legally sufficient evidence of partial performance, all of the jury’s damages findings fail. The Plank Parties did not argue specifically, until after the trial court entered its judgment, that even if the partial-performance exception applied, Wester-gren would not be entitled to any damages based on a benefit-of-the-bargain measure. Therefore, we concluded that Westergren did not waive his JNOV complaint by failing to address this particular issue on appeal.
Even assuming the Plank Parties fairly had presented this issue, we conclude that the jury properly could award Westergren damages on his breach-of-contract claim. True, in Exxon, the court concluded in dicta that even if successful in removing the oral agreement at issue from the statute of frauds because of partial performance, the plaintiff only would be entitled to rebanee damages.
Here, not only did Russell Plank partially perform, but also Westergren fully performed. When there is full performance by one party and partial performance by the other party, the contract no longer falls under the statute of frauds and may be enforced in law (and not simply as a matter of equity). Thus, Westergren can obtain his benefit-of-the-bargain damages. See Davis v. Insurtek, Inc., No. 05-09-01029-CV,
8. The evidence does not conclusively establish the Plank Parties’ affirmative defenses to Westergren’s contract claim.
When a movant for JNOV challenges an adverse finding on an affirmative defense, it must conclusively establish all vital facts in support of that defense. Mosqueda v. G & H Diversified Mfg., Inc.,
The jury found that Russell Plank’s failure to comply was not excused by waiver, prior material breach, or quasi-estoppel. With regard to waiver, we already have concluded that the evidence presents at least a fact issue as to whether Wester-gren released any claims against Russell Plank in the MSA and the Release. See supra Section IV.A.3. Thus, even if the Plank Parties had pointed to specific evidence in support, it would not conclusively establish all vital facts for this defense. See Dow Chem.,
9. The evidence is legally sufficient to support the existence of an agreement between Westergren and Russell Plank, that Russell Plank failed to comply with that agreement, and that West-ergren suffered damages of $500,000 as a result.
We already have addressed most aspects of this ground elsewhere. In sum, Westergren and Langston both testified regarding Russell Plank’s promise to pay Westergren $1 million and a profit interest (ultimately set at 5%) in the development of the 190 acres. There is no dispute that Westergren only received a check in the amount of $500,000, and Russell Plank did not pay Westergren anything beyond the $500,000. Thus, -viewing the evidence in the light most favorable to the jury’s findings, and indulging every reasonable inference to support them, we conclude that more than a scintilla of evidence exists to support the findings that an agreement existed, that Russell Plank breached it, and that Westergren suffered damages of $500,000. See Tanner,
10. We must remand for a new trial on Westergren’s attorney’s fees.
Having concluded that Wester-gren is entitled to reversal and reinstatement of the jury’s findings related to his contract claim, we consider whether we also can reinstate the jury’s award of $200,000 for attorney’s fees for trial, and contingent fees of $25,000 for this appeal and $20,000 for a petition of review to the Texas Supreme Court.
Generally, a party seeking attorney’s fees must segregate fees incurred in connection with a claim that allows their recovery from fees incurred in connection with claims for which no such recovery is allowed. CA Partners v. Spears,
The only testimony provided by Westergren’s attorney was that he had not segregated any fees among claims for which fees are recoverable versus unrecoverable because he did not think it was “necessary.” Notwithstanding Wester-gren’s argument that the facts are interrelated, the Texas Supreme Court expressly has held “[i]ntertwined facts do not make tort fees recoverable.” Id. at 83 (quoting Chapa,
While Westergren’s contract and tort claims may have involved developing some of the same facts and presenting some of the same evidence, Westergren has failed to present evidence that his partnership and fraud claims did not require any solely separate drafting, legal research, or discovery. See id. at 84. Therefore, Wester-gren has failed to demonstrate that segregation of fees is not required. However, Westergren did not forfeit his right to recover attorney’s fees by failing to segregate them, and “[t]he evidence he presented regarding the total amount of attorney’s fees he incurred is some evidence of what the segregated amount should be.” See id. Therefore, we reverse that portion of the trial court’s judgment disregarding the jury’s finding on Westergren’s attorney’s fees, and remand for a new trial on attorney’s fees. See id. at 81, 84 (citing A.G. Edwards & Sons, Inc. v. Beyer,
B. Whether the trial court erred in disregarding the jury’s partnership and fraud findings
In issues two and three, Westergren argues that the trial court erred in disregarding the jury’s findings in his favor on his partnership and affirmative fraud claims. With regard to Westergren’s partnership claims, the jury awarded him $177,608, or “[t]he difference, if any, between the amount Gordon Westergren received from the Defendants and the amount he would have received if the Defendants had paid him the agreed[-]upon amount.” With regard to Westergren’s fraud-by-misrepresentation and statutory fraud claims, the jury awarded him zero dollars, or “[t]he difference, if any, between the amount Gordon Westergren received from the Defendants and the amount he would have received if the De
Under the one-satisfaction rule, a claimant is entitled to only one recovery for any damages suffered. Crown Life Ins. Co. v. Casteel,
In this case, the jury was asked the same measure of damages on each of Westergren’s theories of liability and awarded him the greatest recovery for his contract cause of action.
C. Whether the trial court abused its discretion in denying Westergren leave to amend his petition
In his fourth issue, Westergren asserts that the trial court abused its discretion in denying him leave to amend his petition during trial to plead lack of consideration as an affirmative defense to the MSA. Because we already have sustained West-ergren’s first issue to reinstate the jury’s findings in his favor regarding his contract claim, we need not address this issue to finally dispose of this appeal. See Tex. R.App. P. 47.1.
D. Whether the trial court abused its discretion in its award of costs
Both Westergren and the Plank Parties requested court costs in the trial court. In its final judgment, the trial court awarded court costs to the Plank Parties.
Rule 131 of the Texas Rules of Civil Procedure provides “[t]he successful party to a suit shall recover of his adversary all costs incurred therein, except where otherwise provided.” Tex.R. Civ. P. 131 (emphasis added). A “successful party” under the rules is one that obtains a judgment vindicating a civil right. Perez
Because the trial court’s award of court costs to the Plank Parties was likely predicated on its erroneous granting of JNOV in their favor, and in view of our rulings,
E. Whether the evidence is legally and factually sufficient to support the jury’s failure to find that Westergren breached the MSA or the Release
In the two issues presented in their cross-appeal, the Plank Parties assert that the evidence is legally insufficient or, in the alternative, factually insufficient to support the jury’s failure to find that Westergren breached the MSA or the Release. The Plank Parties argue the evidence conclusively establishes that Wester-gren breached each of these contracts by filing this lawsuit against the Plank Parties, resulting in $729,487.54 in damages ($704,961.10 in reasonable attorney’s fees and $24,526.44 in costs and expenses incurred by the Plank Parties in defending this lawsuit). For the purposes of our analysis, we presume, without deciding, that at least one claim asserted by Wester-gren in this lawsuit is within the scope of the MSA and the Release. Notwithstanding our conclusion that the evidence is legally sufficient to support the jury’s finding that Russell Plank’s failure to comply with the oral agreement was not excused, and the jury’s finding that Russell Plank committed fraud by omission to support Westergren’s fraudulent-inducement defense to the Release, we also presume, solely for purposes of our analysis, that the MSA and the Release are each binding and enforceable against Westergren.
The analysis of these cross-issues requires us to interpret the MSA and the Release to determine if either contract imposes an obligation on Westergren not to file suit on any of the claims released by Westergren. Both the MSA and the Release contain release provisions. Releases are subject to the usual rules of contract construction. Baty v. ProTech Ins. Agency,
Under the MSA, Westergren agrees to “release” and “discharge” the claims in question and to release any notice of lis pendens that he has filed against the 190 acres. Under the Release, Westergren “does hereby fully and unconditionally release and forever relinquish” various rights, titles, and interests, and Wester-gren also “does hereby fully and unconditionally remise, release and forever discharge” various claims. Neither of these contracts contains any language in which Westergren indemnifies, holds harmless, protects, or defends any of the Plank Parties. These contracts do not contain any language in which the parties agree that any of the released parties may recover their attorney’s fees and defense costs against Westergren if he files suit based upon any of the released claims. Nor do these contracts contain any language in which Westergren expressly agrees, promises, or covenants that he will not file suit based upon any of the released claims. See Watson v. Houston Indep. Sch. Dist., No. 14-03-01202-CV,
The Plank Parties do not assert that either contract contains such language. Instead, the Plank Parties argue that a release constitutes a promise not to bring a lawsuit based upon the released claims. The Plank Parties essentially argue that, by agreeing to release and discharge certain claims, a party necessarily and implicitly agrees that he will not file suit based upon any of the released claims. Under this proffered construction, the plain meaning of the release language in the MSA and the Release would include a promise not to file suit based upon any of the released claims. We conclude that this construction is not a valid one.
A release of claims operates to discharge the released parties from these claims and to extinguish these claims against the released parties as effectively as would a prior judgment between the parties. See El Paso Natural Gas Co. v. Minco Oil & Gas, Inc., 8 S.W.3d 309, 314 n. 15 (Tex.1999); Dresser Indus. v. Page Petroleum,
Thus, the release language contained in the MSA and the Release provides the released parties with an affirmative de
The Plank Parties rely upon Ganske v. WRS Group, Inc. See No. 10-06-00050-CV,
The Plank Parties also rely upon P & S Corp. v. Park. See No. 14-05-00115-CV,
We conclude that, as to the issue of whether Westergren promised not to file suit based upon any of the released claims, the MSA and Release are unambiguous. Under the plain meaning of these contracts, Westergren released certain claims but did not promise to refrain from filing suit based upon any of the released claims. See Dresser Indus.,
In addition, the evidence is factually sufficient. Examining the entire record, considering both the evidence in favor of, and contrary to, the challenged finding, and considering and weighing all the evidence, we conclude the jury’s finding that West-ergren did not breach the MSA or the Release was not so contrary to the overwhelming weight of the evidence as to be clearly wrong and manifestly unjust. See Jackson,
In a conditional cross-issue, the Plank Parties assert that if this court reverses the JNOY and enters judgment for West-ergren, any recovery must be limited to $200,000 pursuant to the “Agreement to Limit Third-Party Defendants Indemnity Exposure,” entered into by Westergren and various other parties (the “Frontier Parties”). However, the Plank Parties concede that this cap only applies if the Frontier Parties are required to indemnify the Plank Parties for Westergren’s claims in this case pursuant to a settlement agreement and release, entered into between the Plank Parties and the Frontier Parties. In a separate appeal, this court has concluded that, as a matter of law, Westergren’s claims do not fall within the scope of the settlement agreement and release. Frontier Logistics, L.P. v. Nat’l Prop. Holdings, L.P., — S.W.3d —, —, No. 14-11-00357-CV,
Y. Conclusion
As to the Plank Parties’ motion to disregard jury findings regarding the breach-of-contract claim, Westergren has shown that each independent ground of the motion fails to provide a basis for affirming the trial court’s judgment. Thus, we reverse the trial court’s judgment with regard to, and reinstate in their entirety, the jury’s findings on questions 1, 2, 4, and 5, and partially reinstate the jury’s findings on questions 3 and 14 only with regard to Russell Plank. As a result, we also reverse the trial court’s judgment disregarding the jury’s finding on question 26 as to Westergren’s attorney’s fees; however, because we conclude that Westergren failed to demonstrate that segregation of his awarded attorney’s fees was not required, we remand for a new trial on Westergren’s attorney’s fees. Because Westergren is the only successful party, we also reverse the trial court’s judgment with regard to its allocation of court costs and remand for reallocation. Finally, because Westergren achieved the greatest recovery for his contract claim, we otherwise affirm the trial court’s judgment with regard to Wester-gren’s partnership and fraud claims.
Under the plain meaning of the language in the MSA and the Release, West-ergren did not promise to refrain from filing suit based on any of the allegedly released claims. Therefore, the record evidence is legally and factually sufficient to support the jury’s findings that Wester-gren did not breach any contract, and we affirm that portion of the trial court’s judgment that the Plank Parties take nothing on their counterclaims. Accordingly, the trial court’s judgment is affirmed in part and reversed in part, and we remand for
FROST, J., dissenting.
Notes
. This check was co-signed by Russell Plank, and the check's reference was to "LaPorte Property.”
. This check’s memo was for "Legal Fees — ■ GW.”
. According to Westergren, at some point after Russell Plank presented Westergren with the profits interest agreement where Russell Plank hand-wrote in the 20% profit interest term, Russell Plank presented to Westergren another draft agreement that included the terms of the “cool million bucks and a 5 percent participation.”
. This entity was NPH LaPorte Realty, L.P.
. In December 2005, Arizona Tile, L.L.C. had entered into an earnest money contract for the purchase of this 20 acres from NPH.
. This $500,000 NPH check was co-signed by Russell Plank. In NPH’s accounting records, this payment was approved by "R.D.P.” and initially described as for "Land-Fixed Asset.” Several months later, the description was changed to "Consulting Fees.”
. Westergren had undergone ocular lens replacement due to leukemia and could not read documents without eyeglasses.
. The trial court granted partial directed verdict in favor of the Plank Parties, ruling that any allegation of fraud against NPH prior to the execution of the MSA was barred by the MSA’s disclaimer of reliance. Westergren does not appeal this ruling. As a result of this ruling, the parties agreed that NPH would not be submitted as part of the breach-of-contract claim. The jury did not find that Michael Plank individually entered into the oral agreement, and Westergren does not appeal this finding.
.The jury was instructed on the Plank Parties’ affirmative defenses of prior material breach, waiver, and quasi-estoppel.
. The jury found that NPH was 50% responsible, Michael Plank was 25% responsible, and Russell Plank was 25% responsible for causing Westergren harm due to breach of partnership duties.
. The jury found that NPH was 30% responsible, Michael Plank was 20% responsible, and Russell Plank was 50% responsible for causing Westergren harm due to common-law fraud by misrepresentation and statutory fraud.
.This filing was styled as a motion to disregard the jury’s findings and for judgment notwithstanding the verdict.
. See, e.g., Baylor Univ. v. Sonnichsen,
. To avoid individual liability under the agency defense, a party must prove that he disclosed his agency capacity to the other contracting party and that he identified the true principal for which he was acting. Gordon v. Leasman,
. In support, the Plank Parties relied on Walker Insurance Services v. Bottle Rock Power Corp.,
. Vera v. N. Star Dodge Sales, Inc.,
. Question 13 covered fraud by affirmative misrepresentation, question 14 covered fraud by omission, and question 15 covered statutory fraud involving real estate. Question 19, the damages question associated with the fraud claims, was predicated on an affirmative answer to question 13 or 15.
. The trial court previously had denied the Plank Parties’ motion for summary judgment based on the Release.
. First City Mortgage involved a broker-principal fiduciary relationship in the context of an attempt to secure financing.
. In their appellate brief, the Plank Parties also rely on Bradford v. Vento, where the Texas Supreme Court concluded that the plaintiff's fraud-by-omission claim failed because there was no evidence that the defendant "knew that [the plaintiff] lacked information and did not have ‘an equal opportunity to discover the truth.’"
.In their JNOV motion, the Plank Parties did not argue that Westergren failed to show any other basis for Russell Plank's duty to disclose.
. Because we conclude that there is legally sufficient evidence to support the jury's affirmative finding on fraud by omission with regard to Russell Plank and this jury finding serves in support of Westergren's defense to the Release, to finally dispose of this appeal, we need not address the Plank Parties’ contention on JNOV that even if the jury’s findings on fraud by misrepresentation within another fraud question could support Wester-gren’s fraudulent-inducement defense, West-ergren justifiably could not rely on the alleged "receipt” misrepresentation as a matter of law because he failed to read the Release. See Tex.R.App. P. 47.1. In any event, this situation is distinguishable from that addressed by the en banc court in DRC Parts & Accessories, L.L.C. v. VM Motori, S.P.A., because there the plaintiff alleged the defendant breached the written contract at issue and, in the alternative, alleged that the defendant fraudulently induced it to enter into that contract through affirmative misrepresentation.
Similarly, in concluding that legally sufficient evidence exists to support Westergren’s fraudulent-inducement defense, we presumed the Release to be valid and thus need not address the Plank Parties’ contention on JNOV that the Release covered Russell Plank as a matter of law to finally dispose of this appeal. See Tex.R.App. P. 47.1. In any event, while Michael Plank and NPH and their agents are specifically mentioned in the Release, Russell Plank is not. Further, Russell Plank admitted that he was "not a party individually” to the Release, and that while the Release mentioned "entities that I work with ... and represent, ... I’m not written on here. I’m not personally drawn.” Viewing the evidence in the light most favorable to the jury's finding that Russell Plank acted and was bound in his individual capacity on the oral agreement, and where the evidence indicates Russell Plank continued to wear his “individual” hat in his dealings with Wester-gren, we cannot agree with the Plank Parties that the Release covered Russell Plank as a matter of law to preclude Westergren's fraudulent-inducement defense and void the juty’s affirmative finding.
. In their appellate brief, the Plank Parties apparently recognize that their JNOV argument and cited cases do not apply because Westergren "conceded” that the alleged promise by Russell Plank predated the MSA. However, because in their motion for JNOV, the Plank Parties asserted that the contract claim fails "because any contract was unenforceable for lack of consideration” and because the trial court did not specify upon what ground it decided to grant JNOV, we
. In Fish, the earlier letter agreement at issue was between a corporation and an individual, while the later distribution agreement was between two corporations.
. Bandera Drilling Co. v. Sledge Drilling Corp.,
.On appeal, Westergren does not argue that the oral agreement is not subject to the statute of frauds at all, but rather that the partial-performance exception applies. Thus, for purposes of our analysis, we presume, with
. Duncan v. F-Star Management, L.L.C., relied on by the dissent, is distinguishable. There, neither the sender nor the recipient of the checks at issue was a party to the alleged commission agreements.
. Thus, Resendez v. Maloney, relied on by the Plank Parties, is distinguishable. No. 01-08-00954-CV,
. "No representations warranties or inducements have been made to any party by any other party concerning this Agreement....” (Emphasis added).
. Wheeler v. White,
. Many of our treatises on contracts and the
. See Tex. Civ. Prac. & Rem.Code Ann. § 38.001 (West 2011).
. The trial court refused Westergren’s request to award profits disgorgement. However, whether in equity to award, and the amount of any, profits disgorgement is within the trial court’s discretion. See Burrow v. Arce,
. See supra Section IV.A and infra Section IV.E.
. Westergren submitted to the trial court a bill of costs in the amount of $12,284.78.
. See also McMahan v. Toto,
. In this motion, the Plank Parties asked the trial court to disregard the jury’s findings regarding the breach-of-contract claim based upon various grounds. The trial court granted the Plank Parties’ motion to disregard the jury findings regarding the breach-of-contract claim, without specifying the grounds upon which it relied. Therefore, on appeal, West-ergren must show that each independent ground asserted against the breach-of-con
Dissenting Opinion
dissenting.
Appellant Gordon Westergren signed a contract without reading it. The contract — a release — was a short document but an important one. By its terms, the two-page agreement was meant to resolve a high-dollar business dispute between sophisticated parties. A lot of money was at stake. But, Westergren was in a hurry. He did not have his reading glasses, and he chose not to get them. He had his magnifier, but he chose not to use it. He had the option of having the document read aloud, but he chose not to take it. Westergren’s choice was to sign the document without reading it or having it read to him.
Litigation often follows on the heels of bad choices. And, bad choices sometimes follow on the heels of litigation.
Today, the majority chooses not to apply longstanding Texas law that says people are bound by the plain words in the contracts they sign. The majority instead chooses to craft a fraudulent-nondisclosure theory under which one who chooses not to use his vision enhancers when signing a contract is not bound by the document’s plain words. The majority’s choice goes against the strong current of accountability that runs through Texas law. And, it also goes against binding precedent of the Supreme Court of Texas.
In choosing a partial-performance analysis to determine if an exception to the statute of frauds applies, the majority goes against the weight of Texas authority and creates a conflict with sister courts of appeals. The First Court of Appeals, among others, has held that no fact issue exists despite some evidence that conduct alleged to be partial performance could have been carried out for the fulfillment of the oral agreement. The majority forges a different path and reaches a different destination, an unfamiliar place where the majority applies the partial-performance exception to the statute of frauds even though the alleged conduct was not unequivocally referable to partial performance of the alleged oral agreement.
The issue at the center of today’s controversy is best answered by concluding that the trial court did not err in disregarding the jury’s breach-of-contract findings and in rendering judgment that West-ergren take nothing as to his breach-of-contract claim. This court should affirm the trial court’s judgment in favor of ap-pellees National Property Holdings, L.P., Michael Plank, and Russell Plank (collectively, the “Plank Parties”). Because it does not, I respectfully dissent.
I. The trial court did not err in disregarding the jury findings regarding the breach-of-contract claim.
In his first issue, Westergren asserts that the trial court erred in rendering judgment notwithstanding the verdict as to his breach-of-contract claim and in granting the Plank Parties’ motion to disregard jury findings regarding this claim.
As shown by evidence at trial, the act of paying Westergren $500,000 also could have been done to compensate Westergren for services he had provided in connection with the Property, with an accompanying release by Westergren of claims against various persons, including National Property and Michael and arguably Russell.
Under the unambiguous terms of the Release Agreement, the $500,000 payment could have been made to obtain the releases contained in the Release Agreement, which are incompatible with fulfillment of the Agreement. Under the familiar legal-sufficiency standard of review, the evidence is legally insufficient to support a jury finding that this payment unequivocally referred to the Agreement, corroborated its existence, and was done with no other design than to fulfill the Agreement.
A. The majority’s low threshold for raising a fact issue as to whether conduct is “unequivocally referable” to the Agreement creates a conflict with sister courts of appeals.
Under the majority’s analysis, because there was some testimony indicating that Russell’s tender of the $500,000 check represented a partial payment of the amounts due under the Agreement, there is a fact issue regarding whether this conduct constituted partial performance.
The majority does not address the effect of the unambiguous terms of the Release Agreement on the partial-performance analysis because the majority holds the evidence is legally sufficient to support a jury finding that Russell fraudulently induced Westergren to enter into the Release Agreement.
Westergren testified at trial that he did not have his reading glasses with him, but admitted that he did have a magnifying glass and that the purpose of this vision enhancer was to help with reading. West-ergren gave the following testimony regarding the conduct that Westergren asserts fraudulently induced him to sign the Release Agreement:
Just kind of waiting around and finally Russ calls and Traci took me upstairs and I walked in and I was — high five. How are you doing, Gordon. Yada, yada, yada ... he says, I got your check here. I need you to sign this. He goes — I go, What’s that? He said, Oh, it’s just a receipt. It’s nothing. I said, Well, I’m not reading it ‘cause I’m in a hurry. I don’t have any glasses. He goes, oh, it’s nothing. It’s nothing. I signed it, handed it back to him and got my check. [Westergren snaps his fingers.] It was all that quick. And then [the notary] notarized it and we shot the corn for a few minutes. He told me, Hey, don’t spend all that money until we get another building coming out of theground. I’m not going to be able to give you the other half. Man, I said, That’s fine. This is great. One of the best days of my life. And I — I ran to the bank and turned it into a cashier’s check and went home and had — had a party. Had a good time.
When asked whether Russell told him that the document was a release of all claims, Westergren answered, “No, he said it was a receipt. It’s nothing. You don’t have to worry about it.” Westergren stated that he relied upon these oral representations in signing the Release Agreement. At trial, Russell testified that he did not make these statements. Traci Koenig, the National Property employee Westergren mentioned in the above testimony, testified that in her presence nobody told Wester-gren that the Release Agreement was a receipt. But, even if Russell uttered those words, it would not provide a means for Westergren to avoid enforcement of the written terms of the Release Agreement.
Westergren is not the first to sign a release without reading it and then try to avoid enforcement of the release by claiming he relied upon an oral representation that the release was a receipt.
In Harvey, the Supreme Court of Texas held that the evidence of the doctor’s oral representations and his failure to disclose that the document contained releases by the patient was no evidence that would support a conclusion that the doctor fraudulently induced the patient to sign the release, given that the patient could have read the document to discover its terms.
The majority concludes the evidence is legally sufficient to support a finding that Russell fraudulently failed to disclose to Westergren that the Release Agreement Westergren was signing contained releases by Westergren. The majority concludes that Russell had a duty to make this disclosure based upon either Russell’s alleged
For the foregoing reasons, the evidence is legally insufficient to show that Russell fraudulently induced Westergren to enter into the Release Agreement by fraudulent misrepresentations or by fraudulent failure to disclose that the Release Agreement contains releases by Westergren.
The majority also concludes that West-ergren is excused from the normal consequences of failing to read the Release Agreement before signing it because Russell tricked Westergren into signing this document by failing to disclose that the Release Agreement contained releases by Westergren.
This court should be asking what, if anything, Russell did to block Westergren from reading the document.
The key inquiry is whether Russell was afforded the opportunity to read (or have read to him) the document he was signing, not whether Russell’s alleged statements about the document’s contents were accurate.
The majority suggests that Russell had a duty to give attorney Robert Langston a copy of the Release Agreement and that Russell acted improperly in communicating and dealing directly with Westergren regarding the Release Agreement because Russell allegedly knew Langston was
During trial Langston briefly testified that among “attorneys representing people in litigation” the “custom and practice about how you go about communicating ■with a party that you know to be represented by legal counsel” is that “lawyers cannot deal with the other guy’s client,” and “[y]ou have to deal strictly with the lawyers for that client.” Langston did not testify as to any custom and practice regarding represented clients communicating directly with one another with no attorneys present. Langston did not testify that Russell had a duty to communicate with Langston regarding the Release Agreement or to obtain Langston’s consent before communicating with Wester-gren in this regard. Langston did not testify that Russell had a duty to give Langston a copy of the Release Agreement before presenting it to Westergren. And, Westergren did not argue in the trial court that Russell had any of these duties or that it was legally impermissible for Russell to communicate or deal directly with Westergren regarding the Release Agreement. Westergren has not advanced any such argument in this appeal, and the majority has not cited any authority in support of its analysis in this regard. In any event, Russell’s failure to communicate with Langston and his failure to give Langston a copy of the Release Agreement did not prevent Westergren from reading the Release Agreement.
The two reasons Westergren cited for signing without reading — “I’m in a hurry ” and “I don’t have any glasses ” — are tied to his own choices, not to any conduct by Russell or the Plank Parties and certainly not to any trick or artifice. No one prevented Westergren from reading the document or from getting his eyeglasses or from using his magnifier or from having the two-page Release Agreement read aloud to him. Westergren voluntarily forfeited these opportunities. Consequently, there is no legal basis for the majority’s conclusion that the “trickery or artifice” exception applies and provides a basis to conclude that the evidence is legally sufficient to support a jury finding that Russell fraudulently induced Westergren to enter into the Release Agreement.
D. The majority errs by concluding the evidence is legally sufficient to support a fínding that Westergren did not have an equal opportunity to discover whether the Release Agreement contained releases by Wester-gren.
The majority concludes that the evidence is legally sufficient to support a
The evidence shows that Westergren had the opportunity to read the Release Agreement before signing it. He chose not to do so.
Westergren has no vision restrictions on his driver’s license and he drove himself to the appointment with Russell. Wester-gren did not state that he needed his glasses or that he could not read the Release Agreement. Nor did Westergren request additional time so that he could take whatever steps may have been necessary for him to read the document.
The majority errs in concluding the evidence is legally sufficient to support a finding that Russell fraudulently induced Westergren to sign the Release Agreement because, among other things, the trial evidence is legally insufficient to support a finding that Westergren did not have an equal opportunity to discover whether the Release Agreement contained releases by Westergren or that Russell knew that Westergren did not have an equal opportunity to discover this truth.
For the reasons stated in Sections I.B., I.C., and I.D. of this opinion, the evidence is legally insufficient to support a jury finding that Russell fraudulently induced Westergren to enter into the Release Agreement. Therefore, this court should address the effect of the unambiguous terms of the Release Agreement in the partial-performance analysis. As shown in Section I.A. of this opinion, if the Release Agreement is- considered in this analysis, the evidence is legally insufficient to support the jury’s finding in response to Question 3. Therefore, the trial court did not err in disregarding the breach-of-contract findings and in rendering judgment that Westergren take nothing as to his breach-of-contract claim.
II. The trial court erred in rendering a take-nothing judgment as to the claims for breach of partnership duties, common-law fraud, and statutory fraud.
In his second and third issues, Wester-gren asserts that the trial court erred in rendering judgment notwithstanding the verdict as to Westergren’s claims for breach of partnership duties, statutory fraud, and common-law fraud (collectively the “Tort Claims”).
The jury’s damage findings regarding the Tort Claims were based upon the same measure of damages used in the damage question for the breach-of-contract claim. The jury’s damage findings regarding the Tort Claims were based upon the following measure of damages: “[t]he difference, if any, between the amount Westergren received from the [Plank Parties] and the amount he would have received if the [Plank Parties] had paid him the agreed upon amount.” This is a benefit-of-the-bargain measure of damages, and thus, the only damages that could have been found by the jury as to the Tort Claims are benefit-of-the-bargain damages.
III. The trial court did not reversibly err in denying Westergren leave to amend his pleadings.
In his fourth issue, Westergren asserts that the trial court abused its discretion in denying him leave to amend his petition during trial to plead that the January 2006
IV. Westergren failed to preserve error as to his contention that the trial court erred in awarding costs.
In his fifth issue, Westergren asserts that the trial court should not have awarded all of the court costs to the Plank Parties. Westergren failed to voice this complaint in the trial court and therefore has not preserved error.
V. This court should overrule Wester-gren’s appellate issues and affirm the trial court’s judgment.
As to the Plank Parties’ motion to disregard jury findings regarding the breach-of-contract claim, the evidence is legally insufficient to support the jury’s finding in response to Question 3. Accordingly, the trial court did not err in disregarding the jury’s breach-of-contract findings and in rendering judgment that Westergren take nothing as to his breach-of-contract claim.
Because the statute of frauds bars West-ergren from recovering under his breach-of-contract claim, the statute of frauds also bars Westergren from recovering benefit-of-the-bargain damages based upon his Tort Claims. And, because the only damages that could have been found by the jury as to the Tort Claims are benefit-of-the-bargain damages, the trial court did not err in rendering judgment that West-ergren take nothing as to the Tort Claims. Even if the trial court had erred in denying Westergren leave to amend his petition during trial, the error would be harmless. Westergren failed to preserve error regarding his complaint that the trial court erred in awarding court costs.
For these reasons, this court should overrule Westergren’s appellate issues and affirm the trial court’s judgment.
. The evidence at trial does not reflect any other action or conduct that arguably could have constituted partial performance of the Agreement.
. See Duncan v. F-Star Management, L.L.C.,
. Under the unambiguous language of the Agreement and Release, Westergren released claims against National Property and Michael. Though he was not specifically named in the Release, Russell asserts that the Release also covers claims against him.
. See Resendez v. Maloney, No. 01-08-00954-CV,
. See Resendez,
. See ante at pp. 132-33.
. See id.
. See Resendez,
. The majority concludes that the jury made such a finding in response to Question 14, which submitted a fraudulent nondisclosure theory without any reference to the Release Agreement. In this opinion, it is presumed for the sake of argument that the jury’s finding in response to this question is sufficient to constitute a finding that Russell fraudulently induced Westergren to sign the Release Agreement based upon the fraudulent nondisclosure found by the jury in response to this question.
. See Harvey v. Elder, 191 S.W.2d.686, 688-89 (Tex.App.-San Antonio 1945, writ ref'd).
. See id. at 687-88.
. See id.
. See id.
. See id.
. See id. at 688-89.
. See id.
. See id.
. Id. at 688. The majority seeks to distinguish the Harvey case on the basis that the patient told the notary that she understood the terms of the document she had not read. See ante at pp. 128-29, n. 22. This fact does not materially distinguish the facts of Harvey from the facts of this case. A notary's office is not to determine whether signatories understand the documents they are signing. Westergren, just like the patient, did not read the notarized document that he signed allegedly in reliance upon another party's representation that the document was a receipt and upon that party’s failure to disclose that the document contained releases by the signatory.
. See id. at 688-89. The majority also seeks to distinguish the Harvey case on the basis that the patient was aware the doctor had prepared a release of the promissory notes she had given him in payment for the second and third surgeries. See ante at pp. 128-29, n. 22. Significantly, the patient did not say that the doctor told her about any release in which she was releasing claims, as opposed to the doctor releasing his claims on the promissory notes. Harvey,
. See id. at 689. The Supreme Court of Texas refused the writ of error in Harvey. In cases decided after June 14, 1927, the Supreme Court of Texas's notation of "writ refused” or "petition refused” denotes that the court of appeals’s opinion is the same as a precedent of the Supreme Court of Texas. See Yancy v. United Surgical Partners Int’l, Inc.,
. See Harvey,
. See id. The Harvey court stated that the document the patient signed "was in the nature of a receipt.” Id. In the Release Agreement, Westergren acknowledges receipt of $500,000.
. See id. The Plank Parties raised this issue in their motion for judgment notwithstanding the verdict. In this motion, they asserted that, as a matter of law, a plaintiff cannot assert fraudulent inducement based upon a misrepresentation that conflicts with the express terms of a written contract, even though the plaintiff failed to read the contract.
. See DRC Parts v. VM Motori, S.P.A.,
. See ante at pp. 127-28; Bradford v. Vento,
. See Allen v. Devon Energy Holdings, L.L.C.,
. See Harvey,
. See Allen,
. See Harvey,
. See ante at pp. 128-29, n. 22.
. See Harvey,
. See Harvey,
. See Harvey,
. See ante at pp. 126-28.
. See Harvey,
. See Harvey,
. The majority also concludes that Wester-gren did not have an equal opportunity to discover the truth because Russell did not provide Westergren's attorney with a copy of the Release Agreement before presenting this document to Westergren. The majority cites no evidence or legal authorities showing the Russell had a duty to send this document to Westergren’s attorney. In any event, Wester-gren was free to seek advice of counsel regarding this document either before or after reading the document. Instead, he chose not to read the document and not to seek advice of counsel.
. See Harvey,
.See In re MHI P’ship, Ltd.,
. See Bradford,
. In response to Question 19, the jury declined to find any damages resulting from any fraud committed by the Plank Parties. The trial court granted the Plank Parties' motion to disregard the fraud liability findings. But neither the Plank Parties nor Westergren asked the trial court to set aside the jury's finding in response to Question 19. Wester-gren did not move the trial court to render judgment in his favor based upon the fraud claims. In this context, the trial court’s judgment would appear to be a judgment on the jury’s verdict as to the fraud claims, rather than a judgment notwithstanding the verdict. For the purposes of this analysis, it is presumed that the jury's finding in response to Question 19 and Westergren’s failure to challenge this finding in the trial court do not preclude Westergren from successfully challenging the trial court's judgment as to the fraud claims.
. See Baylor Univ. v. Sonnichsen,
. See Hugh Symons Group, plc v. Motorola, Inc.,
. See Clear Lake City Water Auth. v. Friendswood Dev. Co.,
. See Haase,
.On appeal, Westergren does not argue that the trial court reversibly erred in denying Westergren's "Motion for Disgorgement of Profits from Breaching Fiduciary.” In his briefing, Westergren discusses various issues regarding the disgorgment remedy that he sought in the trial court. Westergren asserts that, if this court were to reverse the trial court’s judgment as to the breach-of-partnership-duties claim or as to the fraud claims, and regardless of whether there will be a new trial to determine fraud damages, this case should be remanded for "a determination of whether the [Plank Parties] should be required to disgorge some or all of their ill-gotten gains.” If this court were to overrule Westergren’s first three issues, it would not be reversing the trial court's judgment as to the breach-of-partnership-duties claim or as to the fraud claims; therefore, the condition precedent to Westergren’s request would not have been triggered.
. See Tex.R.App. P. 44.1(a); Merckling v. Curtis,
. See Cobb v. Morace, No. 01-07-01036-CV,
.I agree with the majority's analysis and disposition of the Plank Parties' two cross-issues. The Plank Parties assert a conditional cross-point in the event this court should reverse the trial court’s judgment that Wester-gren take nothing as to his claims. If the court were to affirm this judgment, it would not need to address this conditional cross-point.
