### NUM BER 13-07- 0057 0-CV 

## COURT OF A PP EA LS T H I R T E E N T H D I S T R I C T O F T E X AS C OR P U S C H R I S T I - E D I N B U R G
ELSA STA TE BA NK & TR USTC O., A pp ellan t,
v . A LB ERT O T REV INO, A pp ellee.
On ap pe al f rom th e 9 3rd Dist rict C ou rt o f H ida lgo C ou nty , T exas .



## ME MOR A N D U M OP I N I ON B efo re J u st ic es Y añ ez , R o d rig u ez , a n d V el a M emo rand um Opin ion b y Ju stice Ya ñe z Appel lan t, El sa Stat e Bank & Tr ustC o. ( “t he Ban k” ), appeal s t he tr ial co urt’ s d eni al of its cross -mot ion for s ummary j udg ment, and t he granti ng of summary

judg ment i n fav or of app ellee, Alberto Trevino. By four issues, the Ba nk con ten ds the trial c ourt erred in g ra nti ng su mmary

j u d gm e n t becaus e ( 1) Trev ino ’s arg ument t hat h e di d nothav e an enf orcea ble con tract w ith the Bank is irrelev ant ; (2) Trevino’s arg um entt h at th e Ban k’s cl aim ag ain st him is bar re d by r es judi cat a is w it hout meri t; (3 ) Si er ra U ti li ti es ass ig ned i tsB y t hi s i s s ue , t he B an k al s o argu es t ha t t he t ri al c ou rt erred i n d en y i ng i t s cro s s -m oti on for su m m ary 1 ju d g m e n t. T re v i n o i s a p a rtn e r i n T & F P ro p e rti e s
.

2
See T EX
. R. C IV
. P. 16 6a (c), (i ). 3 2 rig hts to contract procee ds t o t h e B ank, eithe r by ex press assignm entor by equitable
ass ig nment; and (4 ) alt er nati v ely , fact is sues ex is t as to w hether Si er ra U ti li ti es ass ig ned 1 it s r ig hts to cont ra ct proceed s t o the Bank

. W e aff ir m. Back ground Thi s c as e i nv ol v es the effec t of a M arc h 28 , 20 03 le tt er not i fy i ng Tre v i no , a pr i me cont ra cto r, of the B ank’ s l oan t o Si er ra U ti li ty and Pav ing C ontract ors, In c. ( “S ier ra ”) , a 2 subc ontract or
. The let ter desc ri bes a sec ur it y ar ra ng ement by

w hic h the Bank

req uest ed T rev ino to rende r payment s to Sierra by checks mad e out jointly to Sierra and the Bank. The Bank c o ntends thatthe let ter as si g ns the c ontractproceed s to t he Ban k. Trev ino cont ends that the l etter i s n ot an as si g nment. The Bank

su ed Tr ev ino for b re ach of c ontract , al leg ing that( 1) i ts loa n to Si er ra w as sec ur ed by

a s ecur it y

i nteresti n the co ntractbetw een Si er ra an d T re vi no; ( 2) Trev ino ent ered into a “j oint ch eck agreem ent ,” w here by checks to Sierra w ere to b e ma de join tly payable to Sierra and t h e B a n k( t he March 28 , 200 3 lette r); ( 3) Trevino brea ched his cont ra ct w it h the Bank

by i ss uin g ch eck s p ay abl e s o le ly t o S ie rra; ( 4) Si er ra r efused to deliver the checks to th e Ban k; and (5) as a result, the Ba nk suf fered dam ages beca use $71,631 .69 o f the l oan remaine d unpai d. On S eptember

9, 2005, Trev ino fil ed a no- ev ide nce a n d t ra d it ion al moti on for
sum ma ry

judgmen t. T rev ino arg ued the re is no e v iden ce of a contra ct bet w een himse lf 3R a m ir o G u tie r r e z ’s r e la tio n s h ip to th e p a r tie s is n o t a p p a r e n t f r o m h is e x c e r p te d te s tim o n y. 4
O n J a n u a ry 3 , 2 0 0 6 , T re v i n o fil e d a re s p o n s e to th e B a n k ’ s c ro s s -m o ti o n fo r s u m m a ry j u d g m e n t. 5 O n Febr uar y 17, 200 6, t he Bank f i l ed a r epl y t o T r ev i no’ s r esponse
. Because i t i s unn ece s s ary to our d i s p o s i ti o n , w e d o n o t d e ta i l th o s e a rg u m e n ts h e re
.

In i ts b rie f, th e B a n k a s s e rts th a t t h e a rg u m e n t t h a t i t h a s n o c o n tra c t w ith T re v i n o i s “i rr e l e v a n t” 6 because T r ev i no’ s l i abi l i t y i s “ not base d on a cont r act di rec t l y bet ween M r
. T r ev i no a nd [ t he Bank] , ” but i nst ead, on “ t he e xi st ence ofan assi gnm ent oft he cont r act pr oceeds” fr om Si er r a t o t he Bank, and a showi ng t hat T r ev i no knew or shou l d ha v e known of t he a s s i gn m en t

. W e con cl ude t he Bank has a bando ned any 3 and the Ba nk; alte rnatively , in his t radition al mo tion, he argued his af f irmative def ense s. On Decem ber 14, 2 005 , the B ank f iled its resp onse and cross-motio n for sum ma ry jud g ment. In it s c ro ss -mot ion , t he Ban k mov ed for a tradi ti onal summary judg ment on four g ro unds: ( 1) the joi nt- pay ee- chec k a g re ement i s a n ex pr ess con tractbetw een t he Ban k and Tr ev ino ; ( 2) Trev ino pai d money di re ct ly to Si er ra , ev en th oug h he had ac tual or cons tr uct iv e not ic e of the ass ig nment of the ch eck s t o t h e B a n k; ( 3 ) the B ank is a t hirdpar ty benefic iar

y thatca n s ue on Si er ra ’s promis e tha t the pay ment chec ks w oul d be made joi ntl y pay abl e to Si er ra and the B ank; and (4 ) the Bank re li ed on Trev ino ’s promis e to make t he c heck s j oin tl y pay abl e to Si er ra and the B ank, an d p ro mis sor y es toppel preclud es T rev ino f rom d enying the e nforcea bility o f h is p romise t o issue the ch ecks in this
ma nne r. As summ aryjudgmen t evidence, the Bank a ttach ed (1) the March 28, 20 03 let ter, (2) a copy of the prom issory not e and security agreem ent bet w een Sierra and the Ba nk, and (3 ) ex cer pts of de posi ti on tes ti mony from Ted Sund er lan d, t he Ban k’ s E x ecut iv e Vi cePr esi dent and officer

i n c harg e of the Si er ra l oan; Rami ro Gut ier re z ; and Trev ino

. 4 5 On Octo ber 12 , 200 6, T rev ino f il e d an ame nde d traditio nal m otion for sum ma ry judgme nt an d respo nse to the Ban k’s cross-m otion . Trevino argues tha t: (1) the Ban k’s
cause of action against him fails as a m a t t e r of law beca use it can notestab lish the f irst ele ment of a breach- of-con tractcl aim—that a v ali d enforc eabl e c ontra c t e x i s t s; ( 2) Trev ino

6a rg u m e n t t h a t i t h a d a “d i re c t” c o n tra c t w i th T re v i n o , a n d a c c o rd i n g l y , w e d o n o t d i s c u s s th e p a rti e s ’ a rg u m e n ts

re g a rd i n g th a t i s s u e
.

T r ev i no a sser t s t hat t he Bank obt ai ned a de f aul t j udgm ent aga i nst Si er r a on June 16, 200 4, i n cau se 7 num ber C
- 1055- 04- B i n t he 9 3r d Di st r i ct C our t of H i dal go Count y , st y l ed El sa St at e Bank & Trust C om pany v .S i e rra U ti

li ti e s & P a v in g C o n tra c to rs , In c
. A copy of t he j udgm ent i n t hat cause was no t i ncl uded i n t he s u m m a ry j u d g m e n t e v i d e n c e
. 4 is not li abl e under

an a ss ig nment t heor

y ; ( 3) Trevin o wa s n o t a thi rd -p arty benefic iar

y to the loan by the Ba nk to Sie rra; and (4) Trevi no is notlia b le o n a t h e o ry of prom issory
e s t o p pel be cause Trevino ma de n o prom ise on which the Ba nk cou ld reason ably have
re li ed. As summar

y judg ment ev ide nce, T re v ino attached (1) his cont ra ct w it h Si er ra , ( 2)
a c opy of the promis sor

y note and sec ur it y ag re ement betw een the B ank and Si er ra , ( 3)
a copy of t he Ma rc h 28, 2003 let ter , (4 ) copi es of chec ks from Tr ev ino ’s co mpany to Si er ra , (5 ) a c opy

of an or ig ina l peti ti on in a law sui t filed by the B ank ag ain st Si er ra , ( 6) an e x cer pt from hi s o w n depos it ion tes ti mony , and ( 7 ) an ex cer pt fro m Sunder lan d’s depos it ion tes ti mony
. Trev ino al so a rgu e d i n hi s a mended moti on th at t he Ban k i s b ar re d from
re cov er ing the unpai d bal ance of its l oan t o Si er ra from Tr ev ino bas ed o n res jud ic ata. T rev ino provided a copy of th e Ban k’s suit a gainst Sierra, an d argues tha t Tre v ino w as a neces sar

y par ty to that sui t and that his potent ial liab il it y could hav e been li ti g ated in that pr ior su it

. 7 On A u g u s t 3 , 2 0 0 7 , t h e B a n k fi l e d i t s r e s p o n s e t o Tre v i n o ’ s a me n d e d mo t i o n for
summar y judg ment. In it s res ponse , t he Ban k a rg ued t hat a n as si g nment ex is ted b etw een Si er ra and the B ank, and that Trev ino w as li abl e bec ause he k new of the a ss ig nment an d faile d to compl y

w it h the req uestthatthe chec ks be made j oin tl y pay abl e. In t he altern ative, the Ba nk argued th at an equitable assignmen t can be implied . Th e Ban k also argued its claims a gainst T rev ino i n the prese nt suit are not barred byres judicata beca useSee T EX
. R. C IV
. P. 16 6a (c). 8
Jo e v. Two Th irt

y N ine J

. V. , 1 4 5 S .W .3 d 1 5 0 , 1 5 6 -5 7 (T e x . 2 0 0 4 ); Brant on v. W ood , 100 S. W

. 3d 9 6 4 5 , 6 4 6 (T e x . A p p .– C o rp u s C h ris ti 2 0 0 3 , n o p e t.).

V a l e n c e O p e ra tin g C o . v . D o rs e tt , 16 4 S

. W

. 3d 65 6, 66 1 (T ex
. 20 05 ). 10
C of f ey v. S inger

A sset Fin. C o. , 223 S. W

. 3d 5 59, 562
- 63 ( T ex. App. –D al l as 20 07, no pet

. ) ( ci t i ng 11 St ar - Tel egr am , I nc. v. D oe , 9 1 5 S .W .2 d 4 7 1 , 4 7 3 (T e x . 1 9 9 5 ))

. 5 Trev ino w as not a par

ty to the B ank’ s s uitag ain st Si er ra , and he w as not i n pr iv it y w it h Si er ra
. On Au gust 20, 20 07, the trial court grante d T rev ino’s am end ed m otion for sum ma ry judgme nt. On Au gust 21, 2007 , the trial court den ied th e Ban k’s cross-motion for sum ma ry jud g ment. This appeal ens ued.

S t a n d a r d o f

R e v i e w a n d A p p l i c a b l e L a w Here, bo th T rev ino’s am end ed m otion for sum ma ry judgmen t and the Ban k’s crossmoti on for summar

y jud g ment ar e “t ra dit ion al” moti ons for s ummary j udg ment. W e rev iew

8 t h e t ri a l c o u rt ' s g ra n to f su m m a ry j u d gm e n td e n o vo
. W h e n , a s h e re , b o t h p a rt ie s m o ve 9 for s ummary

j udg ment on the s ame i ss ues and t he tri al cour t g ra nts one moti on and deni es the o ther , t he rev iew ing co urt c onsi ders t he s ummary -j udg ment ev ide nce pr esent ed by both si des, dete rmi nes a ll que st io n s p re sent ed, a nd i f it deter mines the tr ial co urt er re d,
re nders t he j udg ment t he tr ial co urt s houl d hav e rendered. 10 W hen the trial court do es no t specif y the ba sis fo r it s r uling, it is the app ellant ’s burd en o n ap pea l to show tha t non e of the ind epe nde nt ground s thatw ere asse rted in suppo rtof summar

y j udg ment i s s uff ic ien t t o s uppor t the judg ment. Thus, w hen t he tr ial 11
cour t’ s o rd er g ra nti ng su mmary

j u d gment do es not s peci fy the g ro unds on w hic h i t w as g ra nted, w e w il l aff ir m the summar y judg ment if any

of the adv anced theo ri es suppo rttheBrow ning v. Prost ok , 165 S. W

. 3d 3 36, 344 ( T ex. 200 5) ( ci t i ng P ro v i d e n t L i fe In s . C o . v . Kn o tt , 128 12 S .W .3 d 2 1 1 , 2 1 6 (T e x . 2 0 0 3 )) ; C of f ey , 2 2 3 S .W .3 d a t 5 6 3

. Ebert v. Bl ack M ax Dow nhol e Tools (I n r e G ibr al t ar R esources) , 2 1 1 B

. R. 2 1 6 , 2 2 0 ( B a n kr

. N. D. 13 T ex. 199 7) ( f oot not e om i t t ed) ( quot i ng W ol t er s Vi ll age M gm ’

t C o. v. Merchants andPl ant er s N at ’ l Bank of Sher m an , 2 2 3 F .2 d 7 9 3 , 7 9 8 ( 5 th C ir . 1 9 5 5 )) ; see Com m ercial St ruct ures & I nt er

i or s, I nc. v. Li

bert y Educ. M inist r i es, I nc. , 1 9 2 S .W .3 d 8 2 7 , 8 3 3 (T e x . A p p .– F o rt W o rth 2 0 0 6 , n o p e t.) ; Pape Equi p. C o. v. I

. C

. S. , I nc. , 7 3 7 S .W .2 d 3 9 7 , 3 9 9 (T e x . A p p .– H o u s to n [1 4 th D i s t.] 1 9 8 7 , w rit re f’d n .r.e ).

E b e rt, 211 B. R

. at 220

. 14
Id

. 15
Id

. at 22 0-2 1 (i nterna l ci t ati on s an d q uo t ati on s om i t t ed ). 16
H i ghland Par

k S t at e Bank v. Sal az ar , 5 5 5 S .W .2 d 4 8 4 , 4 8 8 ( T e x . C iv . A p p .– S a n A n to n io 1 9 7 7 , w r it 17 re f’d n .r.e .).

Id

. 18 6 jud g ment. 12

“ Av a l i d a s s i g n me n tr e q u i r e s ‘ a ma n i fe s t a t i o n t o a n o t h e r p e rs o n b y

t h e o w n e r

o f a ri g ht i ndi cat ing hi s i ntent ion to transfer , w it hout further ac ti on or

m ani festati on of i ntent ion , his rig ht to such oth er perso n or a third person.’” “A transa ction th at requires a f urthe r act 13 to c omplet e a t ra nsfer w il l not e ff ectan a ss ig nment. I ntenti s a n es sent ial el ement. 14 15 Th e r e i s a d i s t i n c t i o n , h o w e v e r , b e tw e e n i n t e n d i n g t o p a y o u to f a par ti cul ar f u n d and int endi ng a presenttransfer of an i nteresti n tha t fund. “F urther more, i n order to eff ect uate a v ali d transfe r o f a n interesti n a par ti cul ar fund, ‘ the t ra nsfer must be s uch as to le a ve the a ss ig nor w it h no cont ro l ov er

the fund.’” I ntendi ng to pay out of a part ic ula r fund w it hout a ma nifesta tion o f

inten tion to make a presen t transf er me rely g rants a cont ra ctu al ri g ht; w her eas, i ntendi ng a present t ra n sf e r of an i nteresti n a fund g ra nts a proper

ty r ig ht. Thus, for a n ass ig nment to be found, i t mus t be c le a r th a t t h e a s s ig n o r in t e n d s t o gi ve a n d t h e a s s ig n e e in t e n d s t o r e c e ive pr esentow nershi p of the fund. 16 There is al so a di sti nct ion betw een an ass ig nment and the creati on of a mere l ien

. 17 The creati on of a l ien is not an ass ig nment, the tw o bei ng dis ti ng uis hed by the fact th at a li e n is m e re ly a ch a rg e o n p ro p e rt y, wh il e a n a s s ig n m e n t c re a t e s a n in t e re s t in p ro p e rt y. 18E b e rt, 2 1 1 B .R . a t 2 2 1

. 19 Pape , 7 3 7 S .W .2 d a t 4 0 2

. 20
Id

. 21
Id

. 22
In h is a m e n d e d m o tio n , T r e v in o m o v e d f o r s u m m a r y ju d g m e n t o n th e g r o u n d th a t h e is n o t lia b le 23 u n d e r a n a s s ig n m e n t t h e o r y. 7 In c ertai n i nst ances , Tex as cour ts w il l impl y

an e q uit abl e as si gnm ent w hen no
ex pr ess as si g nment c an be est abl is hed. To be an eq uit abl e as si g nment, the a g re ement 19 must ev ide nce an int ent to transfer the int er est and t he transferor mustr eli nq uis h c ontrol
ov er the int er est

. An eq uit abl e ass ig nment can be eff ect ed onl y by a s ur re nder

of cont ro l 20 over the f und s o r property assig ned

. To m ake a n equitab le assignme nt, a n equitab ly 21
cons tr uct iv e appropr iat ion of the s ubj ectmatte r shoul d be made s o as to confer a c omplet e and presentr ig ht in t he par ty for w hose benefit the a ss ig nment i s mean t, ev en w her e the ci rc umstan ces do n ot ad mit of its i mmediat e ex er ci se. 22 Discus sion W e be gin by

add ressing the Ban k’s th ird issue , tha t by the March 2 8, 200 3 lette r, Si er ra a ss ign ed i ts ri g ht t o c ontractproceed s t o the Bank , ei ther by ex pr ess as si g nment
or by eq uit abl e as si g nment. The l etter , on the B ank’ s l etter head, sta ted: 23 Dea r Mr . Tr ev ino : Eff ect iv e tod ay , t he El sa Stat e Bank & Trus t Co. has extended a l oan to S ier ra U ti li ty

and Pav ing C ontract ors, Inc

. This l oan and othe r in d e b t e d n e s s is se c u re d in p a rtb y yo u r c o n t ra c t s d e s c ri b e d b e lo w: 1.) C ontractdate d M ar ch 1 3 , 2 0 03[,] i n the amount of $314,540. 00 for th e c onst ru cti on of the Al ma D eli a Subd iv is ion

. Plea se ma ke all f utu re ch ecks represe nting payme nts by y ou to Sierra Ut il it y and Pav ing C ontract ors, Inc. a n d E ls a St ate B ank & Tr ustC o. Joi ntW inkl er C onstr
. C o. v. H or

nor & C o. , 5 8 0 S .W .2 d 4 0 1 , 4 0 3 ( T e x . C iv . A p p .– S a n A n to n io 1 9 7 9 , w r it 24 re f’d n .r.e .).

Id

. a t 4 0 2

. 25
Id

. 26
Id

. 27
Id

. 28
Id

. a t 4 0 4

. 29
Id

. a t 4 0 2

. 30 8 payme nts sho uld con tinue until obligation s to us are pa id in f ull. Al so, by ac know led g ing bel ow [,] pl e a se veri fy w or k o n thi s j ob has commenc ed and the balan ce to be pai d remaini ng as st ated abov e tot ali ng $314,54 0.00. The le tter

is si g ned by

Sunde rl and, Ex ecut iv e Vi ce Pr esi dent of the Ban k. Iti s “ Approv ed” by R alp h Garci a, P re si dent of Sier ra , and “ Ack now led g ed” by Trev ino

. In sup port of

its arg um entthatSierra ex pressly assigned its rig hts to the con tract proce eds to the Ba nk in the letter, th e Ban k cites W ink ler C onst ru cti on C om pany v. Hor

nor and C om pany
. In W

ink ler , a s ub c on trac to r as s i g ne d i ts r i g ht to r ec ei v e pa y me ntfrom a 24 general con tracto r to its supplier in order to continu e receivi ng supp lies f rom the sup plier. 25 In a lett er, the subco ntract or asked the general con tracto r to make its check payable joint ly to the s u b c o n t r a c t o r

a n d t h e s u p p l i e r
. I n s t e a d , a s i n t h e p r e s e n tc a s e , t h e g e n er al 26 cont ra cto r ma d e t h e c heck pay abl e onl y

to the s ubcon tract or
. A jur y found thatthe 27 subc ontract or

had ass ig ned i ts cl aim to t he s uppl ier

. O n appea l, the W inkler court 28 aff ir med the tr ial co ur

t’ s j udg ment. The g eneral cont ra cto r arg ued t hat n o assi g nment

29 had oc cur re d bec ause the s ubcon tract or ’s endorse m e n t o f the c heck w as re q uired, a nd th e re fore, ithad not s ur re ndered c ontrol of the funds. The W inkler c ou rt r ej ec te d this 30Id

. a t 4 0 3

. 31
Id

. a t 4 0 2

. 32
Id

. 33 9 arg ument, findi ng thatthe ev ide nce est abl is hed an ass ig nment becau se (1 ) “t he det ail s o f th e ar r an g em en t [b etw ee n th e s ub c on trac to r a nd t he s up pl i er

] w ere c om pl et e att he t i me the l etter

w as del iv er ed to [t he s uppl ier ]” an d ( 2 ) th e subcont ra cto r w as obl ig ated to endorse any

ch eck that w as joi ntl y pay abl e and had therefore g iv en up it s ri g ht t o c ontrol t h e m o n e y. 31 W e find W

inkler dis ti ng uis habl e from t he presentca se. I n W ink ler , there w as testim ony that in a te leph one conversation , the g ene ral contract or (W inkler) had expressly ag re ed to “ cons ig n” a s peci fic amount due to the subc ontract or as a j oin t pay ment t o the supp lier and the subco ntract or. T he letter conf irming the agreem entstate d tha t W inkler’s 32 si g nature w oul d i ndi cat e hi s “ acc eptanc e” ; i t w as si g ned by W ink ler ’s ag ent. 33 H ere, th e M arc h 28 , 20 03 l et te r ex pres s l y s ta te s th at th e Ba nk ’ s l oa n to Si er ra is “s ecured in part ” by

T re v ino ’s contract s w it h Sier ra
. The sec ur it y agreement for

the loa n sta tes thatSi er ra g ra nts to the B ank a “ sec ur it y i nterest ” in the “ col lat er al” for t he l oan,
w hic h i ncl udes: AN YAN D ALL C ON TRAC T REC EIVA BLES IN CLU DI NG B UT NOT LIM ITED TO C ON TRACT RE CE IVAB LE N O. 0004 D ATED MA RC H 13, 2003 F ORTHE CO NS TRU CT IO N OF THE ALM A D ELIA SU BD IVIS ION LOC ATED IN ALAM O, TX. BETW EEN C ON TRAC TOR SIER RA U TILITIES & PA VIN G C ON TRAC TORS, IN C. AN D OW NE R ALBER T TREVI NO

. T his language m erely grant s the Ba nk a secu rity in t e re s t in Sierra’s contract receivables. In add ition, u nde r “ T ERM OF AGREEMENT ,” the secu rity agreeme nt sta tes: “Th is Agreem ent , and the security intere st create d by the Agreeme nt, wi ll rem ain in forceC of f ey , 2 2 3 S .W .3 d a t 5 6 4 -6 7

. 34
Id

. a t 5 6 7

. 35
Id

. at 566 ( ci t i ng M cAll en St at e Bank v. Tex. Bank & Tr ust C o. , 433 S. W

. 2d 1 67, 171 ( T ex. 196 8) 36 (stat i ng t ha t on e e l em en t of a “pl ed ge ” i s t ha t t he ri gh t to re de em p l ed ge d pro pe rt y rem ai ns i n t he pl ed go r) ).

S e e i d

. at 566
- 67. 37 10 unt il all of

the In deb ted ness is pai d i n f ull, unle ss the secu rity interest crea ted bythis Agreem entis earlier release d by Secured Pa rty in w riting.” In Co ffey v. Sin ger Asse t Finance Com pan y, L.L .C. , t he D al l as c ou rt of a pp ea ls

34 conclu ded thata se curitya greem ent , w hich pled ged a secu rity interest in th e bo rrow ers’ future str uct ur ed s ettl ement pa y ments as col lat er al f o r a l oan, unambi g uousl y created a li en o n t h e s e t t l e me n t p a y me n t s , a n d d i d n o t a s s i g n t h e s e t t l e me n t p a y me n t s t o the len der

. I n i ts anal y si s, the c our t s tated : 35 In fact, th e do cum ent s specif ically state thatapp e llants ple dge the ir fut ure period ic payment s as collatera l fo r loans, an d ea ch transa ction inclu des a security ag reem ent creating a security intere st in the co llateral. Addi ti onal ly , t he s ecur it y ag re ements contai n l ang uag e tha t t er minat es the ag re ements and the s ecur it y i nterest s w hen t he l oans ar e pa id i n full

. . . . This l ang uag e s uppor ts our c o ncl usi on th at t hese transac ti ons ar e not ass ig nments bec ause the sec ur it y int er est s i n the co ll ateral ter minat e upon payme nt in f ull of

the loa n am oun ts. 36 W e c oncl ude t hat t he s ecur it y a gre e m ent a t i ss ue here, l ik e tho se in Cof fey , una mb iguously create d on ly a security intere st in the p ledged co llateral—Sie rra’s contract proceed s. W e hol d that nei ther the sec ur it y ag re ement nor the Ma rc h 28, 200 3 le tter
cons ti tutes an a ss ig nment. 37 W e are also unpersuade d bythe Bank ’s arg ument t hat a n eq uit abl e as si g nment c an be im plied u nde r these circum stan ces. “[T] he tw o cent ral f acto rs to estab lish an equitab leE be rt , 211 B. R

. at 222

. 38
Id

. 39 11 ass ig nment are an int ent to ass ig n and a total r eli nq uis hment of c ontrol. ” I f the as si g nor 38 (h er e, S ier ra ) re tai ns any co ntrol ov er

the fund, i t i s fatal to the c lai m of the as si g nee. 39 Nei ther the let ter

nor the sec ur it y

ag re ement c ontai ns lan g uage su f f ic ien t t o est abl is h an int ent t o effectan e q uit abl e as si g nment. As not ed abov e, t he s ecur it y a g r e e m e n tg r a n t e d t h e B a n ko n l y a s e c u r i t y

i n t e r e s ti n S i e r r a ’ s c o n t r a c tp ro c e e d s
. W e hol d tha t no eq uit abl e as si g nment oc cur re d. W e ov er ru le the B ank’ s t hird i ss ue. Conclusion W e h o ld that the t ri al cour t di d noter r in g ra nti ng Trev ino ’s amended moti on for
s u m m a r y j u d g m e n ta n d i n d e n y i n g t h e B a n k ’ s c ro s s - m o t i o n fo r s u m m a r y j u d g m e n t

. W e aff ir m the tr ial co urt’ s j udg ment.

LINDA REYNA Y AÑEZ, J u s t i c e Me moran dum Opi nio n del iv er ed and filed thi s t he 23rd day

of Apr il , 200 9.