ZAPATA COUNTY APPRAISAL DISTRICT, Appellant and Cross-Appellee, v. COASTAL OIL & GAS CORPORATION and Coastal Oil & Gas USA, L.P., Appellees and Cross-Appellants.
No. 04-01-00083-CV.
Court of Appeals of Texas, San Antonio.
Sept. 18, 2002.
847 S.W.2d 847
FRAUD/MISREPRESENTATION
Halper also contends that summary judgment was improper as to his fraud/misrepresentation claim because UIW misrepresented that he would have the rights and privileges established in the Faculty Handbook with regard to tenure. UIW contends that Halper‘s at-will employment status bars his fraud/misrepresentation claim. In recognizing the general rule that at-will status will bar a fraud/misrepresentation claim, Texas courts have drawn a distinction based on the timing of the alleged misrepresentation. If the alleged misrepresentation was made after the employee began employment, the employee‘s at-will status will preclude a fraud claim; however, if the alleged misrepresentation was made before the employee commenced employment, the fraud claim is not barred. See Offshore Petroleum Divers, Inc. v. Cromp, 952 S.W.2d 954, 955 (Tex.App.-Beaumont 1997, pet denied); see also Crow v. Rockett Special Utility Dist., 17 S.W.3d 320, 329-30 (Tex.App.-Waco 2000, pet. denied) (noting to prevail on defense of at-will status, the defendant must establish: (1) the employee is at-will; and (2) the representations were made after the employee began his employment). In this case, Halper contends that UIW represented it would follow its tenure procedures before his employment commenced; therefore, the at-will defense is not applicable even assuming Halper was an at-will employee.
A fraud cause of action requires a material misrepresentation, which was false, and which was either known to be false when made or was asserted without knowledge of its truth, which was intended to be acted upon, which was relied upon, and which caused injury. Formosa Plastics Corp. USA v. Presidio Engineers and Contractors, Inc., 960 S.W.2d 41, 47-48 (Tex.1998). A promise of future performance constitutes an actionable misrepresentation if the promise was made with no intention of performing at the time it was made. Id.
Halper contends that UIW misrepresented that it would follow the tenure procedures in the Faculty Handbook. As noted in regard to Halper‘s breach of contract claim, the evidence conclusively established that UIW followed its tenure procedures. Therefore, the representation by UIW was not false, and summary judgment was properly granted as to Halper‘s fraud/misrepresentation claim.
CONCLUSION
The trial court‘s judgment is affirmed.
William Ikard, Laurie Ratliff, Mark S. Hutcheson, William W. Kilgarlin, Popp & Ikard, L.L.P., Austin, for appellees.
Sitting: SARAH B. DUNCAN, Justice, KAREN ANGELINI, Justice, SANDEE BRYAN MARION, Justice.
ON APPELLANT‘S MOTION FOR REHEARING
Opinion by: SARAH B. DUNCAN, Justice.
We deny Zapata County‘s motion for rehearing. However, we withdraw our
Zapata County Appraisal District appeals the trial court‘s judgment upholding the values placed by Coastal Oil and Gas Company and Coastal Oil & Gas USA, L.P. on two oil and gas interests. In its cross appeal, Coastal challenges the trial court‘s denial of its request for attorney‘s fees. We hold the trial court correctly valued the working interests but erred in denying Coastal‘s request for attorney‘s fees.
FACTUAL AND PROCEDURAL BACKGROUND
In 1991, Coastal acquired twenty-one percent of the working interest in two natural gas units, Guerra A and Guerra B, located in part in Zapata County. At the time, fifty percent of the natural gas produced from these units was sold on the “spot market” and fifty percent was committed to Tennessee Gas Pipeline Company pursuant to a long term take-or-pay gas purchase contract. Under the contract, Coastal agreed not to sell any of the gas produced from the committed reserves to any party other than Tennessee for the contract‘s term. In exchange, Tennessee agreed to either buy the gas from Coastal at the contract price or not buy the gas and pay a reservation fee. Although the contract price for the gas was $2.067 per Mcf at the inception of the contract, it escalated to approximately $8 per Mcf by 1992. During the tax years in question, Tennessee opted to take the gas committed to it by the contract.
Because Coastal‘s working interests in the Guerra A and B units are income producing property, Zapata County based its appraisal on the income method outlined in section 23.175(a) of the Texas Tax Code, which provides in pertinent part:
If a real property interest in oil or gas in place is appraised by a method that takes into account the future income from the sale of oil or gas to be produced from the interest, the method must use the average price of the oil or gas from the interest for the preceding year as the price at which the oil or gas produced from the interest is projected to be sold in the current year of the appraisal. The average price for the preceding year is calculated by dividing the sum of the prices for which oil and gas from the interest was selling on each day of the preceding calendar year, excluding February 29, by 365....
Coastal protested Zapata County‘s appraised values in accordance with
TRIAL COURT JURISDICTION
Zapata County argues that because Coastal failed to raise its “commitment fee” argument before the Zapata Appraisal Review Board, the trial court was deprived of jurisdiction over this theory. We disagree.
As Zapata County argues, a party‘s failure to exhaust its administrative remedies deprives the trial court of jurisdiction. See Webb County Appraisal Dist. v. New Laredo Hotel, 792 S.W.2d 952, 954-55 (Tex.1990). However, Zapata County has not cited and we have not found any authority for the proposition that a party fails to exhaust its administrative remedies if it fails to raise a particular argument before the appraisal review board. In New Laredo Hotel, the issue was the taxpayer‘s failure to appear before the appraisal review board. Id. And in Harris County Appraisal Dist. v. Texas Nat‘l Bank of Baytown, 775 S.W.2d 66 (Tex. App.-Houston [1st Dist.] 1989, no writ), the issue was whether the taxpayer informed the review board of the substance of its complaint at all. Texas Nat‘l Bank, 775 S.W.2d at 70. Neither supports Zapata County‘s argument.
Because Coastal filed its protest in accordance with the Tax Code and informed the Zapata Appraisal Review Board of the substance of its complaint—that Zapata County‘s appraisal of its property was greater than the property‘s market value—we hold Coastal exhausted its administrative remedies. The trial court therefore had jurisdiction over Coastal‘s appeal.
INTERPRETATION OF SECTION 23.175
Zapata County contends that “[t]he plain language of section 23.175 requires that all prices paid for gas in the preceding year be used in calculating the average price—including prices paid under a long term purchase agreement such as the GPA involved here.” We agree. But our agreement on this issue does not affect the resolution of Zapata County‘s appeal. The dispositive issue in this case is not whether
STANDARD OF REVIEW
The remaining issues in Zapata County‘s appeal are governed by the abuse of discretion standard of review. See City of Brownsville v. Alvarado, 897 S.W.2d 750, 753 (Tex.1995) (admission and exclusion of evidence); Texas Dep‘t of Human Servs. v. E.B., 802 S.W.2d 647, 649 (Tex.1990). With respect to factual matters, a trial court abuses its discretion if, under the record, it reasonably could have reached only one decision and it failed to do so. See Walker v. Packer, 827 S.W.2d 833, 840 (Tex.1992). However, “[a] trial court has no ‘discretion’ in determining what the law is or applying the law to the facts. Thus, a clear failure by the trial court to analyze or apply the law correctly will constitute an abuse of discretion....” Id.
VALUE OF THE INTERESTS
Zapata County contends the trial court erred in admitting Lowe‘s testimony
The parol evidence rule precludes consideration of extrinsic evidence that contradicts, varies, or adds to the terms of an unambiguous written agreement. See Hubacek v. Ennis State Bank, 159 Tex. 166, 317 S.W.2d 30, 31 (1958) (holding that parol evidence rule is a rule of substantive law and thus precludes consideration of evidence admitted in violation of the rule). However, “it is ... well settled ... that this rule of exclusion extends only to parties to the written instrument, those in privity with such a party or one who claims a right or benefit under the contract; the rule is inapplicable to situations where one of the litigants is a stranger to the agreement.” In re Cooper, 2 B.R. 188, 194 (Bankr.S.D.Tex.1980) (citing Texas cases, including Pointer v. Pointer, 197 S.W.2d 504, 505 (Tex.Civ.App.-San Antonio 1946, no writ)).
Because Zapata County was not a party to the contract, in privity with a party, or a beneficiary of the contract, the parol evidence rule does not apply. Moreover, even if the rule applied, Lowe‘s testimony was not offered to vary, add to, or contradict the terms of the contract; nor did it do so. Rather, Lowe‘s testimony was offered to assist the jury in construing the contract so that it could determine the price paid by Tennessee for the gas; and the substance of Lowe‘s testimony achieved just that purpose. For these reasons, we hold the trial court did not abuse its discretion in admitting Lowe‘s testimony.
CHARGE ERROR
Zapata County argues the court‘s charge assumed the truth of Coastal‘s valuation theory and thus impermissibly commented on the weight of the evidence by instructing the jury to exclude from the fair market value of the subject property “that portion of the sales price, if any, that [it found] attributable to intangible personal property.” See
ATTORNEY‘S FEES
In its cross appeal, Coastal argues the trial court erred in denying its request for attorney‘s fees. We agree, although our reasoning differs somewhat from that set forth in Coastal‘s brief.
Although not recognized by either party, the precedent leading to what we believe to be the correct answer to Coastal‘s complaint is Bocquet v. Herring, 972 S.W.2d 19, 20 (Tex.1998).1 In Bocquet, the
Among the opinions Bocquet cites in support of this unarticulated principle are cases involving the statutory provision providing that a party “may recover” its reasonable and necessary attorney‘s fees in a breach of contract action. See id. Tracing this line of cases backwards in Texas jurisprudence leads to Justice Holman‘s opinion in Kimbrough v. Fox, 631 S.W.2d 606 (Tex.App.-Fort Worth 1982, no writ), in which it appears the underlying principle was first enunciated:
The question is whether ... the legislature granted the litigant permission to recover the fees or whether it granted the trial court permission to either award or deny such fees.
We conclude that if the legislature had intended to vest the permission or discretion in the trial court, the permissive language would have provided that the court may award (such fees).
The statute, however, states that “the claimant may ... also recover ... a reasonable amount as attorney‘s fees.”
The location of the word “may,” and an analogous construction by our Supreme Court of a claimant‘s right to statutory treble damages in Woods v. Littleton[, 554 S.W.2d 662 (1977)] ... persuades us that the language of [the statute] grants to the litigant the permission to recover the fees he is able to prove reasonable. We hold that upon such proof, the award is mandatory.
In an excessive appraisal appeal,
CONCLUSION
Because the trial court properly admitted Lowe‘s testimony and properly instructed the jury to exclude intangible personal property from its valuation finding, we affirm that part of the trial court‘s judgment upholding Coastal‘s valuation. However, because an award of attorney‘s fees under
SANDEE BRYAN MARION, Justice.
Concurring and dissenting opinion by: SANDEE BRYAN MARION, Justice.
I agree with the denial of Zapata County‘s motion for rehearing. I withdraw my concurring and dissenting opinion of July 31, 2002 and substitute this opinion in its place.
I concur with the majority on all issues except on the issue of attorney‘s fees. Notwithstanding the dicta in the Bocquet case, I believe the language in
Even Coastal acknowledges that the award of fees is discretionary, but argues the trial court abused its discretion by failing to award any fees. The test for abuse of discretion is not whether, in the opinion of the reviewing court, the facts present an appropriate case for the trial court‘s action. Downer v. Aquamarine Operators, Inc., 701 S.W.2d 238, 241 (Tex. 1985); Smithson v. Cessna Aircraft Co., 665 S.W.2d 439, 443 (Tex.1984). Rather, a trial court abuses its discretion when it reaches a decision so arbitrary and unreasonable that it amounts to a clear and prejudicial error of the law. Downer, 701 S.W.2d at 241-42; Cessna Aircraft, 665 S.W.2d at 443. To ascertain whether the trial court abused its discretion, the reviewing court must determine if the trial court acted without reference to any guiding rules and principles. Morrow v. H.E.B., Inc., 714 S.W.2d 297, 298 (Tex. 1986).