### TEXA S C OU R T OF A PPEAL S, THIR D DIST R ICT , AT AU STIN

NO. 03-0 8 -00 555 -CV

C. W. 10 0 Lo uis H e nna, Lt d., App e lla nt

v. El Chi co Re staurants of T exas, L.P ., and E l Chico Restaurants, Inc. , Appellees

F ROM THE DISTRICT CO URT OF WI LLIAM SO N COUNTY , 277TH JUDICIAL DISTRICT

NO. 07- 857- C277 , HO NORAB LE KEN ANDERSO N , JUDGE PRESIDI NG

O P I N I O N
Th is is ana

p p e a l f r o ma f i n a l s u m m ar

y j u d g m e n t , o nc r o s s - m o t i o n s , i na d i s p ute betwee n a landlord, a

ppellant C.W. 100 L ouis Henna, Ltd. (Henna ), a te nant, app el l ee El Chico Restaura nts of Texas, L .P. (El Chico) , and the tenant’s g uara ntor, El Chico Restaurants, Inc., over the prope r construc tion of their commerc ial g round lease
. The principal issue c oncer ns whether

airconditioning units that El Chico installed on a building that the le ase require d it to construct are “improveme nts” that the lease obligated El Chico to ma intain a nd deliver to H enna in good c ondition upon the lease ’s expiration, as Henna c ontends, or ar e tra de fixtures that are excluded from the lease ’s def

inition of “improvements,” a s appellee s argue. We a g ree with a ppellees that the airconditioning units are trade fix tures and not “improveme nts” as a matter of law. Be cause this is one of the g rounds o n whi ch the district cour t could have r elied in g rantingsummary judgme nt for appellee s, we will aff

irm the judg ment.A “ton” is a measure of air conditioning power . I t r efe rs to the cooling power of one ton 1 of ice melting in a 24- hour per iod. W ebster’s Third New International Dictionary 2407 (1986).

2 BACK GR OUND The mate rial under ly ing f acts are undisputed. On September 24, 1996, E l Chico and Henna ’s pre dece ssor, Boa rdwa lk Center, Ltd., entere d into a g round lea se of a parc el of land loc ated in Round Rock that Boar dwalk owne d and wa s developing as part of a new r etail shopping cente r. On the same day , El Chico Restaurants, Inc. sig ned an a g ree ment to gua rante e El Chico’s oblig ations under the g round lea se.

Am on g its oth e r o bli g a tio ns un de r t he g ro un d le a se, El Chi c o w a s r e qu ir e d to
c on str uc t a bu ild ingon

th e pa rc e l it wa s le a sin g (d e fi ne d a s th e “ L and ” ) w ith in t he pe rm iss ibl e building are a ref

lected in the projec t’s site plan and “pursua nt to plans and specific ations approve d in writing by

L andlord [Boa

rdwa lk] .” The lease define d this “building and ot her improve ments and appurte nance s that may

here afte r be e rec ted” o n t h e L an d as the “ I mprovements” a nd define d the L and and I mpr ov e me nts c oll e c tiv e ly a s the “ Pr e mis e s. ” Th e re fe re nc e d “ pla ns and sp e c if ic a tio ns ” included or depic ted two 12.5-ton air conditioni ng units and two 10-ton units (the “HVA C units”), 1 wh i ch we re t o b e i n s t al l edo nt o p o f t h e b u i l d i n g.

The lease authoriz ed El Chico to use the Premises to oper ate a “re staurant, a

related cockta il lounge, suc h other uses as are incidental to the operation thereof a nd for a ny other law ful purp os e ,” su

bje c t to its c omp lying wi th “ a ll a pp lic a ble g ov e rnme nta l and

re g ulator y re qu ir e me nts and re g ulations.” The lea se wa s to run for a n initial term ex piring on the tenth anniver sary of the “Rent Commence ment Date” —a date tied to when El Chico opene d fo r b u s i ness on the3

Premises—subject to El Chico’s rig ht to rene w t he lease for up to four additional terms of five y ear s
eac h. Whil e the lease was in effe ct, El Chico would own the Improvements “he rea fter c onstructed or plac ed on the L and duringthe Ter m,” but El Chico had “no r ight to demolish, remove or alter the I mprovements without L andlord’s prior written consent.” El Chico was fur ther re quired to ca

rry sp e c i f i e d i n s u r an c e o nt h e P r e m i s e s an d “ t ak e g o o d

c ar e o f t h e I mp r o v e m e n t s d

ur i n g t h e T e rm , including r epair s to the interior, exterior and structure, it being under stood that L andlord shall not be re quired to maintain the Premises or m ak e any

repa irs to the I mprovements duringthe Ter m.” At the end of the lease , El Chico was require d to “ deliver up the L and with the Improvements then situated there on in good r epair and condition, loss by

fire or oth er ca s u al t y , condemnation, act of God, ordinar

y wea r and tear , deca

y , depre ciation and obsolesc ence beingexcepted,” where upon the I mprovements we re to “ be and be come the pr operty of L andlord
. . . without compensation there for.” Howeve r, p ar agr aph 12 of the lease pr ovided that “tra de and busine ss fix tures . . . shall not be deeme d to be par

t of the Premises but shall rema in the proper ty of Tena nt.” The “Rent Commencement Date” was in April 1997, which me ant that the ten- y ear initial lease term ran unt il April 2007. The recor d ref lects t hat, i n April 2006, Boa rdwa lk conveyed its int e re st i n th e Pr e mis e s and the g ro un d lea se to H e nn a B lvd ., L .L .C. , w hic h th e n a ssi g ne d th e se interests to Henna
. Around the same time, El Chico g ave written notice to He nna B lvd., L .L .C. that El Chico had ce ased doingbusiness in the P re m i s es an d t h at it would permit the lease to expi re
a t th e e nd of the ini tia l te rm

wi tho ut r e ne wi ngit. I n thi s do c ume nt, El Chi c o a lso wa ive d a ny ri g hts it possessed under the lease that would have preve nted Henna Blvd., L .L .C. ( or He nna, its succe ssor)4

from mar keting and selling or lea sing the Premises , an d E l C h ico ag ree d to execute a doc ument terminating the lease upon the l an d l o rd ’s re quest if the landlord suc cee ded in selling or lea sing the Pr e mis e s. I n J une 2006, El Chico sold Henna “all fur niture, fixtures and equ i p m ent (collec tively , the ‘Asse ts’) located, as of this date, in the El Chico® restaur ant at 100 L ouis Henna B ou le va rd , Ro und Ro ck. ” He nn a a c kn ow le dg e d a

nd a g re e d th a t it

“ ha [d] in sp e c te d th e As se ts at t he P remises and [was] acquir ing the Assets in their ‘AS I S’ condition.” Around the sa me time, El Chico and Henna

amende d the g round l ea se to provide that e ffe ctive June 23, 2006, Henna
wo u l d assume re sponsibili ty for pa ying a ll charg es for

utilit y service s at the Premises, including the sec urity

alar m sy stem, and for m ai n taining the g rounds ar ound the Improvements. Howe ver, El Chi co contin

ue d to make monthl y

re nta l pa y me nts thr ou g h th e e nd

of the ini tia l le a se te rm

in April 2007. I n J anuar

y 2007, a fe w months before t h e l ea se’s Apr il ex piration, Henna lear ned that the HVAC units on top of the re staurant building h ad been va ndalized by

copper thieves and dama g ed by

hail. Henna

obtained an e stimate o f $ 3 8 , 4 9 6 t o repair the dama g e. A se ries of communications ensued betwee n the parties or their ag ents in which it wa s disputed whether Henna
or El Chi c o w a s r e sp on sib le fo r r e pa ir ingand /or ins ur inga g a ins t th e dama g e to t he HV AC units
. Eventually , in Aug ust and S eptember of t hat y ear , counsel for Henna sent letters to both El Chico
and , a s gua

ra nto r, El Chi c o Res ta

ur ants , I nc ., de mand ing pa y me nt of the $3 8, 49 6 e sti mate d r e pa ir
amou nt. I n O c tob e r, He nn a

su e d th e se e nti tie s.5 He n n a al l eged tha

t appellee s were obligated under the g round lea se to insure
or re pair the H VAC units and had fa iled to perform . I t asserte d a ca use of a ction for br eac h of contr a c t a n d s o u g h t d ama g e s an d

a tt o r n e y ’ s f e e s . H e nn a

f il e d a “ tr a d it io n a l” mo ti o nf

o r p artial
summa ry jud g me nt a s to a

pp e lle e s’ lia

bil ity fo r b re a c hin g the le a se . It atte mpt e d to c on c lus ivel y
e sta bli she a c h o f t

he e le me nts of

its br e a c h- of

-c on tr a c t c a

us e of a c tio n; n ame ly , th a t: (1 ) a va lid contra ct exist ed betwe en the pa rties; (2) He n n a h ad performe d or tende red pe rfor mance ; (3) a ppellees ha d brea ched the contra ct; and (4) Henna was damag ed as a result of t he breac h. See New Y ork Life Ins. Co. v. Miller , 114 S.W .3d 114, 12 1 (T ex . Ap p . — Austin 2003, no pet.). Ap pe lle e s file d a re sp on se and a “ tr a dit ion a l” c ro ss- mot ion in whic h th e y

a tte mpt e d to c on c lus ive ly neg ate e ach of

these e lements, as well as Henna’s entitl ement to attorney ’s fees. R eg ardingbrea ch, the par ties joined issue as t o wh ether the HVAC units are I mprovements that appe llees we re obligated under

the g round lea se t o repa ir or i nsure, as Henna argued, or a re tra de fixtures that were excluded from that obligation, a s appellee s contende d. The parties also joined issue as to whether Henna had complied with the default or remedy provisions of t he lease, whether He nna had inc urre d any damag e s , o r

w h e th e r H e n n a h a d an y e n ti tl e me n t t o a tt o r

n e y ’ s f e e s . F o ll o w in g a

h e ar in g , the district court re ndere d final judg ment denying H enna’ s summary -judg ment motion and gr anting appellee s’ motion without s t at i ng the spec ific g rounds on which it re lied. Henna there afte r filed
a mot ion fo r new tria l, whic h th e dis tr ic t c ourt de nie d b y

wr itt e n o rd e r f

oll ow inga

he ari ng . T his appea l ensued.6 AN AL YSI S Henna bring s twelve issues on appe al. I t d i s putes whethe r appe llees we re e ntitled to preva il on any

of the summary -judg ment g rounds pre sented in their motio n
— s p e c if ic ally , whether appellee s conclusively

neg ated the e lements of breach (points five and six ), He nna’s pe rfor mance (points seven a

nd eig ht), damag es (poi n t s n i n e and te n), or He nna’s e ntitlement to attorney ’s fe es (point twelve). H enna a lso brings a corr esponding set of points complaining that the district court
err ed in d en y i n g Henna’s summary -judg ment motion. Henna asse rts that it established eac h of the eleme nts of its breac h-of- contra ct ca use of a ction as a matter of law : brea ch (points one a nd two), per formanc e (point three ), and da mag es (point four) , and that it was e ntitled to attorney ’s fe es (point eleve n).
St a nd a r d o f r e v ie w

We reviewthe district court’s summar y judgme nt de novo. ValenceOperating Co.

v . D or se tt , 1 64 S.W. 3d

65 6, 66 1 ( Tex. 2 00 5) ; Pr ov ide nt L ife&Ac c ide nt I ns . Co . v . Kn ott , 128 S.W .3d 211, 215 (Tex. 2003). Summary judgme nt is proper when ther e ar e no disputed issues of m ater ial fac t and the movant is entitled to judgment as a matter of la

w. Tex. R. C iv. P. 166a(c). I n decidingwhether

there is a disputed materia l fac t issue prec luding summary judgme nt, we take as true pr oof fa

vorable to the non-movant, and we indulge ever y rea sonable infe renc e and r esolve any doubt in favor of

the non-movant. Randall’s Food Mkts., Inc . v. Johnson , 891 S.W .2d640, 644 (T ex . 1995). Where, a s here , the par ties file cr oss-motions for summary judgme nt on overla pping issues, a

nd the trial court g rants one motion and denies the ot her, we shoul d revie w the7

summary -judg ment evidenc e supportingboth motions and “re nder the judgme nt that the trial court should have re ndere d.” FM Pr op s. Op e ra tin g Co . v . Ci ty of A us tin , 22 S.W .3d 868, 872 (Tex. 2000). As the movant in a “t ra d itional” summary -judg ment motion challeng ing H enna’ s br e a c h- of -c on tr a c t c a

us e of a c tio n, a pp e lle e s h a d the ini tia l bu rd e n o f c on c lus ive ly

ne g a tin g a t le a st
on e e le me nt o f th at caus e of a c tio n ( i.e ., e sta bli sh ingon e of

the g ro un ds in t

he ir mot ion a s a matter of la

w). See KPMG Peat Marwick v . Harrison County Hous. Fin. Corp. , 988 S.W .2d 746, 748 (Tex. 1999). Assuming appellee s met that burden a s to at least one e lement, the burde n shifted to H e nn a to p re se nt s umm ary -j ud g me nt e vid e nc e ra isi nga g e nu in e is su e of

mate ri a l f

a c t a s to that element or

elements. See M

.D. Anderson Ho sp. & Tumor Inst. v. W illri ch , 28 S.W .3d 22, 24 (T e x. 20 00 ) ( pe r c ur iam)
. B e c a us e the dis tr ic t c ourt did no t sp e c if y the g ro un d o n w hic h it

re lie d in g ra nti nga pp e lle e s’ mot ion , w e may a ff ir m th e summa

ry jud g me nt i f a

ny g ro un d is me ri tor iou s. State Farm Fire &Cas. Co. v. S.S. , 858 S.W .2d 374, 380 (Tex. 1993).

I f the district cour

t properly g rante d appellee s’ summary -judg ment motion, it follows that it did not err in denying H enna’ s motion on the s ame gr ounds. See F M Props. Operating Co. , 22 S.W .3d at 872. I f we conclude that the district court e rre d in g rantingappellee s’ motion, then we
cons i d er whether

it also erre d in denying H enna’ s motion. To prevail on its moti on, Henna had the burden of establishing its e ntitlement to judgme nt a s a matter of law by conclusively establishing
eac h el em en t of its brea ch-of -contra ct ca

use of a ction. See W

illri ch , 28 S.W .3d at 23 (c iting Rhône-P oulenc, I

nc. v. Ste el , 997 S.W. 2d 21 7, 22 2- 23 (T e x. 19 99 ); Oram v. Gene ral Am . Oil Co. , 513 S.W .2d 533, 534 (Tex. 1974) (per curiam)).8

“Im provem ents” ver sus trade fixtu res

Appellee s’ summary -judg ment g round attac king the breach element of Henna ’s
cause of ac tion was premised on its ar g ument that, as a matter of law , the HVAC units wer e “tr ade or business fixt ures” under pa rag raph 1 2 o f t he g round lea se and not “ I mprovements” that the lease require d them to r epair or insure. Henna challeng es this leg al conclusion in its fi ft h issue, contendingthat the district court erre d in gr anting summary judgme nt on this ground be cause the HVAC units were instead “Improvements” a s a matter of law, or that at l east a fac t issue rema ins as to the parties’ intent. Simi larly , in its first issue, Henna argues that bec ause the HVAC units were

“ I mpr ov e me nts ” a s a

matte r o f l aw, it e sta

bli sh e d th e br e a c h e le me nt of its c a us e of a c tio n a s a matter of la

w. Our r esolution of these issues turns on construc tion of the g round lea se. See Tem po Tamers, Inc. v . Crow-Houston Four, L td. , 715 S.W .2d 658, 664 (Tex. App.—Dallas 1986, wr it ref’ d
n. r.e.) ( ob se rv ingthat su c h is su e s turn on the pa rt ie s’ int e nt, wh ic h c ourt s a sc e rt a in b y loo kin g to
re le va nt p ro vis ion s o f a

c on tr a c t g ov e rn ingthe ir us e of the re a lty ); J im W alte r W ind ow C om po ne nts
v . Tu rn pik e Di st. Ctr

. , 642 S.W .2d 3, 4 (Tex. App.—Dallas 1982, wr it ref’ d n.r.e.) (“The intent of the par ties reg ardingthe rig ht to remove a dditions at the termination of a lea se is to be deter mined from the pr ovisions of the lease a g ree ment.”).

When we construe a written contract, such as the g round lea se, our pr imary conce rn is to ascer

tain and g ive e ff

ec t t o t he intentions the parties ha ve objec tively

manifested in that instrument. Frost Nat’l Bank v. L& F Distribs., L td. , 165 S.W
. 3d 310, 311-12 (Te x . 2005) (p e r c ur iam) ; see Fiess v. State Farm Lloyds , 202 S.W .3d 744, 746 (Tex. 2006) (“A s with any other
c o n t r a c t , t h e p art i e s ’ i n t e n t i s g o v e r n e d b y w h a t th e y s a i d , n o tb y w h a tth e y intended to s ay but di d9

not.”). To that e nd, we construe the lease in its entirety , considering eac h part in re lation to every other pa rt so that the ef

fec t of ea ch par

t on others may

be dete rm i n ed an d t h at no part will be rende red me aning less. See City of Keller v. W ilson , 1 68 S .W .3 d 802, 81 1 ( Te x. 20 05 ); Valence Operating Co. , 1 64 S.W. 3d a t 66 2. Contr act te rm s are g ive n th e ir pla in, or din ary , a

nd g e ne ra lly
acc epted mea

nings unless the contract itself shows them to be used in a technica l or diffe rent sense
. ValenceOperating Co. , 164 S.W .3d at 662. In deter mining the meaning of contra ct terms, we may also consider

the context of the circ umstances e x isting at the time the contra ct was e x ecute d and the particula r business activity soug ht to be served. Se e Colum bia Ga s Tran sm iss ion Cor p. v . Ne w U

lm Gas, Ltd. , 94 0 S.W. 2d 58 7, 58 9 ( Te x. 19 96 ); Reilly v. Range rs Mgmt., Inc. , 727 S.W .2d 527, 530 (Tex. 1987). I f w e ca n gi ve the c ontrac t a def inite or ce rtain leg al meaning , it is unambiguous and we construe it as a

matter of l aw. W

ill is v . D on ne lly , 199 S.W .3d 262, 275 (Tex. 2006); J.M. D avidson, Inc. v . W

ebster , 128 S.W .3d 223, 229 (Tex. 2003)
. I f, on the other ha nd, the contra ct is subject to two or more r easona ble interpre tations, it i s ambig uous, which c re at es a fa ct issue as to the parties’ intent. Columbia Gas Tr ansmission Cor p. , 940 S.W .2d at 589. Whether a contra ct is ambiguous is a que stion of law. Id.

At the cente r of the parties’ competing contentions is pa ragraph 12 of the lease , which expli citly excludes “trade or business fixt ures” from “Improvements”:
12. Equipment, Fixt ures a nd Signs (a) Tena

nt shall have the rig ht to e rec t, install, m aintain and ope rate on th e Pr e mi s e s s u c he qu ip me nt, trade and business fixtures , signs (including , without limitation, py lon sig nag e) and other personal proper ty as Tena nt may deem ne cessa

ry or appr opriate, an d s uc h s h all not be dee med to be part of the Pre mises, but shall remain the10 property of Tenant . Any such instal lations shall be in acc ordanc e with applicable loc al code s an d Tena nt’s pylon signa g e and monument signa g e, if applicable , shall be ins talled in those locations de sig nate d th e re fo r a s r e fl e c te d in the Site Pla

n. At any tim e duri n g t h e Term and within thirty (30) da y s after the expiration or termination of the Term, Tenant shall have the rig ht to remove a ll or any part of T enant’ s equipment, remov able fixtures , s i gn s (i n cl u d i n g, without lim itation, its pylon signa g e, if a ny ) and o t h er pe rsonal pr op e rt y fr om t he Pr e mis e s, pr ov ide d th a t T e na nt rep airs a ll dama g e to t

he I mpr ov e me nts c a

us e d b y su c h re mov a l. Any

pr op e rt y re ma ini ngin t

he I mpr ov e me nts a ft e r s uc h th ir ty (3 0) da y pe ri od sh a ll be de e me d to have be e n a ba nd on e d b y

Te na nt. ( I ta li c s a d d e d
. ) B e c a

u s e th e “ Pr e mi s e s ” f

r o m w h ic h “ tr a d e o r b u s in e s s f ixt ur e s ” ar e e xc lude d are define d elsewhe re in the le ase to mea n the “L and” plus the “ I mprovements,” pa ra graph 12 means that any thing c onstitut ing a

“tra de or business f

ix ture” (or, f

or that m atter, a

ny thing c onstitut ing “such e quipment, . . . signs . . . and othe r p er s o n al prope rty as Tena nt may deem ne cessa

ry or
a pp ro pr iate ” to i ns ta ll o r o pe rate on the Pr e mis e s) c ann ot b e an Impr ov e me nt. The g round lea s e d o e s n o t contain a de finition of trade or business fix tures. Howe ver, the te rm “ tr a de fi xtur e ” has acqui re d a we ll- e sta

bli sh e d, c omm on ly

un de rs too d me anin g in Texas law. As one of

our sister cour

ts has observe d:
The ter m “trade fix ture” has been de fined many times by the cour ts. . . . “I t is now we ll s e ttl e d th a t, a s b e tw e e n a land lor d a

nd his te na nt, the te rm

‘t ra de fi xtur e s’ re fe rs to a

nd me ans su c h a

rt ic le s a s ma

y be ann e xed

to t he re a lt y by the te na nt t o e na ble him pr op e rl y or e ff ic ient ly to c arr

y on the tr a de , p ro fe ssi on , o r e nte rp ri se contemplated by

the tenancy

contra ct or in which he is eng ag ed while oc cupying the pr e mis e s, and

wh ic h c an b e re mov e d w ith out mate ri a l or pe rm anen t injur

y to the fre ehold.”11

Boye tt v. Boegne r , 746 S.W .2d 25, 27 (Tex. A pp.—Houston [1st Dist.] 1988, no writ ) ( quoting Granberry v . Texas Pub. Serv . Co. , 171 S.W .2d 184, 186 (Tex. Civ. App.—Amar illo 1943,
no wr it) ). I t is a lso we ll e sta bli sh e d th a t tr a de fi xtur e s are dis tin g uished fro m “ imp ro ve me nts ” and o th e r ty p e s o f f ixt u r e s ( i. e . , p e r s o n a l p r o p e r ty a f f ixe d to r e a lt y )
. “ A nim

p r o v e me n t i n c lude s
a ll a dd iti on s to the fr e e ho ld e xce pt f or tra de fi xtur e s w hic h c an b e re mov e d w ith out in jur y to the prope rty .” Sonnier v. Chisholm-Ryde r Co. , 9 09 S.W. 2d 47 5, 47 9 ( Te x. 19 95 ); see also Reames v. Hawthorne-Se ving, Inc

. , 94 9 S.W. 2d 75 8, 76 1 ( Te x. Ap p. —D a lla s 1 99 7, pe t. d e nie d) (“ Th e c la ss of imp ro ve me nts is c on sidered to b e br oa de r t ha n th a t of fi xtur e s, wh ic h a

re ite ms o f p e rs on a lty th at hav e be c ome pe rm ane nt p art s o f t he re a lty to w hic h th e y are a ff ixed . T he re fo re , a lth ou g h a ll impro v em en ts are not ne cessa rily fix tures, any

fix ture, unless it is a trade fix ture, is consider ed an improveme nt. A trade fix ture is an item, which c an be r emoved without mater ial or per manent injury to the fre ehold, that a tena nt annexes to rea lty to enable the t enant to car ry on its business.” (Citations omi tted.)). The rationale for these distinctions is that “[i] mprovements made by a vendor , mor tg a g or or anc e sto r a

re ma de to e nh anc e the va lu e of the e state , a

nd to b e pe rm ane nt; wh ile those made by

the tenant a

re te mporary

and made for purposes of his trade .” Jim W alter W indow Com po ne nts , 6 4 2 S
. W
. 2 d at 5 (q u o t i n g Me nge r v . W ar d , 28 S.W . 821, 823 (Tex. Civ. App.—San Antonio 1894), rev’d on other grounds , 30 S.W . 853 (Tex. 1895)).

The dra fters’ use of “ trade or business fixt ures” within paragraph 12 without pr ov idi ngde fi nit ion s o f t

he se te rm s th a t w ou ld b e un iqu e to t his a g re e me nt s ug g e sts the ir int e nt t o employ the well-established definitions and conc epts set out in case law. Af ter g rantingthe tenant the rig ht to inst all or maint a in “ e q u ip me nt,” “ trade or business fixtures ,” “sig ns,” and “ other pe rsonal12

pr op e rt y ,” pa ra g ra ph12 pr ov ide s the ten ant a c or re sp on din g ri g ht t o r e mov e a ll o r p art of its “equipment,” “ remov able fixtures ,” “ sig ns ,” an d “o the r p e rs on a l pr op e rt y fr om t he Pr e mis e s, p ro v i d edt h at T en an tre p ai rs al l d am age t o th e Imp ro v em en t s ca u s edb y s u ch re m o v al
. ” T h i s u s age
re fl e c ts that, c on sis te nt w iththe c omm on me anin g of

tr a de fi xtur e s in

Te xas l aw, “ tr a de or

bu sin e ss fix tures” unde r the lea se ar e conside red to be remova ble per sonal proper

ty . Simi larly , para g raph 12 excluded “tra de or business f ix tures” f rom the lea se’s de finition of “I mprovem en t s , ” j u s t as trade fix tures ar e excluded fr om improvements under Te x as law.

Ap pe lle e s con c lus ive ly e sta bli sh e d that the HV AC un its a t is su e me t th e c omm on ly understood def

inition of trade fixtu

r e s . T h e y p r e s e nte d uncontrove rted summary -judg ment evidenc e that the HVAC units wer e not attache d to the building, but wer e desig ned to be a nd wer e plac ed on curbs on the r oof so they

could be remove d and repla ced without injury to the building, and that such units neede d to be replace d periodica lly as t hey rea ched the end of their useful life c y cles. Appe llees l i k ew i s e pre sented undisputed evide nce that the HVAC units here wer e appr oachingthe end of their useful lives, and that the units ultimately wer e re place d without injury to the building. F urther, app el l ee s p re s en t edu n co n t ro v er t eds u m m ary -j u d gm en tev i d en ce th at th e 4 5 t o n s o f a i r- co n d i t i oning
ca p a c it y p r o v id e d b y th e H V A C u n it s f a c il it a te d th e b u il d in g ’ s u s e a s a r e s ta ur an t, b u t was many times gr eate r than that ne eded if the building we re to be used for other retail or off ice use . Severa l Texas courts, addre ssing similar fa cts, have held that air- conditioning units are trade fix tures as a matter of law. See Bo

y e tt , 7 46 S.W. 2d

a t 27 -2 8; W

hite v. Cadwallader & Co ., 299 S.W .2d 189, 19 0- 92 (T e x. Civ . App .— San A nto nio 19 57 , w ri t r e f’ d n .r .e .) ; Moskowitz v. Calloway , 178 S.W .2d 87 8, 87 9- 80 (T e x. Civ . App .— Te xar ka na 19 44 , w ri t r e f’ d w .o .m. ); cf. Nine Hundred Main, Inc. v

.13

City of Houston , 150 S.W .2d 468, 471-73 (Tex. Civ. App.—Galve ston 1941, writ dism’d judgm’t cor.) (distinguishing tenant-installed a ir-conditioning sy stem that had bee n constructe d in a manner making it an integ ral pa

rt of the building ). Henna corr ectly observe s that there is no rule or pre sumption in Texas law that airconditioning units are alway s trade f ix tures. The issue, rathe r, turns on the pa rties’ intent, which here we a scer

tain from the g round lea se. See Tem po Tamers, Inc. , 715 S.W .2d at 664. Henna argues that po rt ion s o f t

he g ro un d le a se outsi de pa ra g ra ph12 re fl e c t the dr a ft e r’ s inte nt t hat th e HV AC un its be conside red “ I mprovements” unde r the lea se and that this de f inition, not the commonly understood definitions of improv ements and tra de fixtures, must control. See id. at 664-66 (e x ample of
c a se wh e re le a se langua g e de mon str a te d th a t “ the pa rt ie s in thi s c a se c ou ld n ot h ave re a so na bly intended that ‘tra de fixtures’ have the l eg al m eaning ascr ibed t o it by the courts”). He nna re lies on pa ra g ra ph1 o f the le a se , whi c h de fi ne s “Impr ov e me nts ” a s “any bu ild ingand oth e r i mpr ov e me nts and appur tenanc es that may

here afte r be e rec ted” on the L and, in conjunction with par ag raph 5:
5. Construction. The I mprovements shal l b e co n s t ructed and situated on the L and wi thi n the pe rm iss ibl e bu ild ingare a re fl e c te d o n th e Site Plan a nd purs ua nt t o plans and spec ifications appr oved in writingby L andlord; provide d, howeve r, that Tena nt shall have the right to revise the permissible building a rea and the a pproved plans and spec ifications subject to L andlord’s prior written consent, which conse nt shall not be unrea sonably withheld or dela y ed. Notwithstanding any thing c ontained here in to the contrar

y , howeve r, L andlor d h ereby consents to and a

pproves of

the prototy pical plans a

nd specific ations which are being used by Tena nt on the Effe ctive Date of this L ease and hereby ag ree s that Tena nt shall have the rig ht to construct the I mpr ov e me nts wi tho ut any fu rt he r co ns e nt by L and lor d so longa s th e I mpr ov e me nts are constructe d g ener ally

in acc ordanc e with such prototy pical plans. . . .14

He nn a pr e se nte d unc on tr ov e rt e d s umm ary -j ud g me nt e vid e nc e that th e “pl ans and sp e c if ic a tio ns ” ref ere nced in pa

rag raph 5 inc luded a dr awingof a f our-unit, 45-ton HVA C sy stem like that El Chico late r i ns ta lle d. Thus , H e nn a re a so ns , th e “ I mpr ov e me nts [that] sh a ll b e c on str uc te d .
. . purs ua

nt t o plans and spec ifications” unde r parag raph 5 included the HVAC uni ts that El Chico later installed.

Ba sed on this pre mise, Henna argues that para g raph 5 evince s the draf ters’ a g ree ment and intent to impose an oblig ation on El Chico to inc lude the HVAC units at issue when construc ting the building. He nna also re lies on para g raphs 6 a nd 30 of t he ground lease for a sim ilar proposition. Parag raph 6 a

uthorized El Chi co to use the Pre mises “for the operation of a restaur ant
. . . and for any other lawful purpose , subject, howe ver, to . . . a ll applicable g overnme ntal and re g ulatory requir em en t s an d

re s t ri ct i o n s . ” S i m i l ar l y , p ar agr ap h3 0 p ro v i d edth at , d uri n g t h e l ea s e t erm , “T en ant

. . . s h al l conform to and comply with all ordinance s, regulations and laws (f eder al, state, or municipal) . . . af

fec ting the Pre mises. . . .” Hen n a p resented summary -judg ment evidenc e that El C h i co had obta ined a c ertifica te of oc cupanc y

for its resta

urant fr om the City

of Round Rock based on the plans and spec ifications. Fr om this, Henna re asons that El Chico had oblig ations under para g raphs 6 a

nd 30 to install t he HVA C units in order to comply with this “regulatory

require ment.” Th e e xiste nc e of the se a g re e me nts and ob lig a tio ns on

the pa rt of El Chi c o to ins ta ll the HVAC units when c onstructing its restaura nt bui l d i n g , Henna

further rea sons, disti ng uishes the HVAC units from a tr ade f ix ture, whic h, Henna asser ts, is char acte rized by

a tena nt’s unilatera l decision t o af

fi x p ersonalty

to an exist ing buildingthat the tenant ha s leased. Re latedly , Henna argues that the HV AC units wer e part of t he conside ration the landlord ba rg ained to obtain under

the g round lea se. In sum, Henna ur g es that “[t] he dec ision to originally incorporate t he HVAC sy stem“Pursua n t to” is defined a s “in confor mance to or ag ree ment with” or “ acc ordingto.” 2 W ebster’s Third New International Dictionary 1848 (1986). 15 wa s n e ith e r u

nil ate ra l no r v olu

nta ry ; r a the r, su c h d e c isi on was bilate ra l, b e tw e e n E l Ch ic o a nd its landlord, as well as require d under the plans and spec ifications incorpor ated into the g round lea se, itself, of cour se, t h e p ro d u ct of a rms-leng th neg otiation between the parties, a fac tual distinction absolutely

deter minative in the prese nt appea l.” The c hief fla

w in He n na’s r easoningis its foundational premise that the g round lease ’s definition of “Improvements” encompa ssed the HVAC units be cause the p l an s and specific ations calle d fo r t wo 12-ton units and two 10-ton units like El Chi co installed. Contrary to H e nn a ’s argume nt, pa

ra g ra ph 5 do e s no t purp or

t to i nc or po ra te int o th e le a se ’s “ I mpr ov e me nts ” definition whateve r proper ty might have been depicted in the plans and specific ations. Parag raph 5 require s that “[t] he Im

pr ov e me nts shall be construc ted . . . pursuant to [ the] plans and spec ifications,” wh ic h me ans that th e I mpr ov e me nts mus t be c on str uc te d in a mann e r c arr

ying out or

in c on fo rm ity wi th t he pla ns and sp e c if ic a tio ns . I t does not follow from th i s re q u i re m ent that any piece of 2 proper ty depicted in the pla

ns and spec ifications, eve n if otherwise considere d a tra de fixture, equipment, or other persona l pr operty , would be an I mprovement. For example, appellee s prese nted summary -judg ment evidenc e that the plans a nd specific ations also included depic tions of El Chico’s walk-in c oolers, fr eezer s, tables and chair s, and other trade fix tures or restaur ant equipment. I f, as Henna argues, par ag raph 5 me ans that all property depicted in the pla

ns and spec ifications is an “Improvement” that El Chico could not r emove without the landlord’s a pproval, it would conflict wi th p a ra g ra ph12 , w hic h g ra

nts El Chi c o th e ri g ht to “r e mov e a ll or any pa rt of Te na nt’ s e qu ipm e nt,16

remova ble fixt ures, sig ns . . . and other persona l property

from the Pre mises, provided that Tena nt
re p a ir s a ll d ama g e to th e I mp r o v e me n ts c a u s e d b y s u c h r e mo v a l. ” We mu s t in s te ad construe these provisions in relation to one another so a s to giv e b o t h ef fec t. See V

alenceOperating Co. , 16 4 S.W. 3d a t 66 2. Con se qu e ntl y , we c ann ot c on c lud e that the dr a ft e rs int e nd e d pa ra graph 5 to
me an th a t all pr op e rt

y de pic te d in

the pla ns and sp e c if ic a tio ns is “ I mpr ov e me nts ” that E l Ch ic o c ou ld not remove and that the l andlord would own after the lease expired. In short, para g raph 5 doe s not mean that the H VAC units are “ I mprovements” unde r the g round lea se.

We a re simil arly unpersua ded by Henna ’s argument that the HVAC units cannot be t ra d e fix tures bec ause the draf ters anticipated at the ince ption of the g round lea se that El Chico would install such uni ts when constructing the restaurant buil ding. Henna is corr ect that the reporte d Texas case s holding that a ir-conditioning units are tra de fix tures have involved units that a tenant installed in a pree x isting building dur ing a lease term—not, as her e, a ground lea se whe re the parties contemplated that the tenant would construct a building and install the units. See Bo y e tt , 746 S.W .2d
a t 27 -2 8; W

h ite , 29 9 S.W. 2d

a t 19 0- 92 ; Mo sk

owi tz , 1 78 S.W. 2d

a t 87 9- 80 . A lth ou g h H e nn a is
corr ec t a s a

f a c tu a l m a tt e r , w e d is a g r e e th a t t h e le g a l p r in c ip le g o v e r

n in g th e s e d e c is io n s turns solely on whether

or whe n the t enant a

nd/or landlord anticipated that the units would be installed. The c ritical issue, rather, is whethe r the pa rties i ntended the air-c onditioning uni ts to be per manent additions to the building, for the landlord’s owner ship and bene fit as par t of the re alty , or tempora

ry ad d i t i o n s to aid the tenant, El Chico, while it was ope ratinga re staurant in the building
. Se e J im W alte r W ind ow C om po ne nts , 6 4 2 S
. W
. 2 d

at5 (q u o t i n g Menge r , 28 S.W . at 823). We asc erta in such intent, as Henna has acknow ledg ed, from the t erms of the g round lea se. Id. at 4 (“The intent of the17

parties r eg ardingthe right to remove additions at t he termination of a lease is to be determined fr om the pr ov isi on s o f t

he le a se a g re e me nt. ” ); see Tem po Tamers, Inc. , 715 S.W .2d at 664. The dra fters’ use of “tra de or business fix tures” in para g raph 12 of t he g round lea se, as d i s cu ssed, manife sts their intent to incorporate the commonly understood mea

ning of tr a d e f ixt u r e s u n d e r T e xa s la

w . Pa r a g r a p h 5 o f th e le a s e d o e s n o t r e f le c t a c o n tr ar

y intent, nor do para g raphs 6 a

nd 30, the other pr ovisions on which Henna r eli es. As appe llees obser ve, He nna’s arguments concerningthe re staurant’ s cer tificate of occupa ncy are simply

inapposite. The f

act t h at E l C h i co s u

b m i t t edt h e p l an s an d

s p ec i fi ca t i o n s t o t h e C i ty o f R o un d

R o ckwh en o b t ai n i n g a
cer tificate of occupa ncy permitting it to operate a r estaura nt in the b u i l d i n g h as no bea ringon whether the dra fters intende d the HVAC units or ot h er p roper ty depicted in the pla

ns and sp e c if ic a tio ns to b e “ I mpr ov e me nts ” or tr a de fi xtur e s. Appellee s conclusively

established that the HVAC units are trade fix tures under the
e sta bli sh e d de fi nit ion

of that te rm in T e xas l aw. Para g ra

ph12 e xplic itl y

e xclu de s “ tr a de or

bu sin e ss fix tures” f

rom the “Pre mises” and, thus, the “ I mprovements” unde r the lea se. In other wor ds, the g ro un d lea se un ambi g uo us ly manif e sts the dr a ft e rs ’ i nte nt t

hat th e HV AC un its El Chi c o w a s to i n s t al l o nt h e b u i l d i n g wo u l d b e t em p o r a ry

ad d i t i o n s t o th e r ea l ty

t o ai d E l C h i co i no p er at i n g a restaur ant there , which El Chico would continue to own a t the lease ’s conc lusion, and not “Improvements” that it wa s require d to ma intain or repa ir for the landlord’s be nefit. We are bound to give eff

ect to this unambig uous lang uag e as the controlling indicator of the barg ain the dra fters intended to strike. Se e W ill is , 1 99 S.W. 3d

a t 27 5; J.M. D avidson, Inc. , 128 S.W .3d at 229.18 I n a fina l argument, Henna asser ts that El Chi co “didn’ t consider the H VAC sy stem a fixture” in its J une 2006 sale of “a ll furnitur e, fi x t u re s and equipment” to Henna be cause the HV AC un its did

no t a pp e ar i n th e lis t of

pr op e rt y a tta c he d to the bil l of sa le
. He nn a su g g e sts thi s evidenc e ra ises an i n fe re n ce that, as late a s J une 2006, El Chico intended or understood that the HV AC un its we re no t tra de fi xtur e s. We dis a g re e . F ir st, e ve n a ssumin g that “ fi xtur e s” a s u se d in the bill of sale would have inclu d ed t ra d e fixtures, the rec ord does not support He nna’s f actua l pr e mis e that E l Ch ic o e xclu de d th e HV AC un its fr om t hat c a te g or

y of pr op e rt y —th e bil l of

sa le expli citly cover s “all fur n i t u re , fi x tures and e quipment, whether or not listed in Ex hibit ‘A.’” Second, and mor e importantly , even if this evidence suppo rt ed an inf ere nce a s to El Chi co’s
su bje c tiv e int e nt o r u

nd e rs tand ing re g ard ing wh e the r the HV AC un its we re tr a de fi xtur e s, it w ou ld be incompete nt to raise a f act issue as to the par

ties’ intent in the fac e of the unambig uous g round lease
. S ee Hubace k v. E

nnis State Bank , 3 17 S.W. 2d 30 , 3 2 ( Te x. 19 58 ) ( pa

ro l- e vid e nc e ru le is a limit ation of substantive contra ct law a nd not merely

a rule of evide nce)
. Henna ’s bre ach- of-c ontrac t claims are predic ated o n the leg al conc lusion that the HVAC units wer e “Improvements” unde r the g round l ease . Be cause the HVAC units wer e not “I mprovements” a s a matter of law, the district cour

t properly g rant ed s u m m ary

judgme nt for a ppellees o n t h e ground that He nna ca nnot prove bre ach. A ccor dingly , we ove rrule H enna’ s fifth point of err or and its cor respondingfirst point of err or. Be c a us e thi s g ro un d a lon e is s uf fi c ie nt t o s up po rt

summa ry jud g me nt, see S.S. , 85 8 S. W.2 d at 38 0, we ne e d n ot re a c h He nn a ’s c on te nti on s re g ard ingoth e r gro un ds and e le me nts
. SeeTex. R. App. P . 47.1.19 CO NC LU SION We affir m the district court’s judg ment.

__________________________________________ Bob Pembe rton, J ustice Be fore J ustices Patterson, Pember ton and Waldrop Affir med Filed: August 27, 2009