1 In its li ve petition, TCA

alle ged that Entech, Inc. “i s a Montana Del aware [si c] corporation,”that Nor thwestern Resources Com pany “i s a Montana Corporation,” and that C. G. Em bry “is a r es ide nt o f Fa irfie ld, Fr ee st o ne Co un t y, T ex as . ” I t is not con tended th at C. G. Em

bry is a d iffer en t pe r so n fr o m Ca rr o ll Emb ry, w ho sig ne d t wo inst rume nt s, mat er ial in t his appeal , as “V ice P r es id en t / Ge ne r al M an ag er ” o f N o r t hw es t er n R es o ur ce s C o mp an y. 

### TEXA S COU RT O F AP PEAL S, THIR D DISTRIC T, AT AU STIN

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4444 NO. 03-00-00257-CV

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4444 TCA Building Compa ny, Appel lant
v. Entech, Inc.; C. G. Embry; and Northwestern Res ources Com pany, Appellees

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4444444444 FROM THE DISTRICT CO URT OF TRAVIS COUNTY, 261S T JUDICIAL DIST RICT NO. 95-11006, H ONORABLE F. SCOTT MCCOWN, JUDG E PRESIDING

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TCABuilding Co mpany (T CA) a ppe als fro m a ta ke- not hing summary jud gment recovered by Entech, In

c., C. G . Em

br y , an d N orth we stern Re sou rce s C om pa ny on ca us esof ac ti on bro ught aga inst t hem by TCA. 1 For co nve nie nc e, we will r efe rt o t he ap pe llee
- de fen da nt s c o llec t ive ly
as “N orthwes

tern” sav e as i t ma y be ne ces sary

t o na me o ne o f t he m pa r t icu lar ly. W e w ill affirm the judgm ent bel ow.2 THE CON TROVER

SY Pu rsu ant t o t wo 19 78 co al le ases and a permi t issued b

y the Texas Rai

lroad Co mmi ssio n, No rt hw estern conducts a lign ite-m in in g operation known as the Jewett Mine. Northwe stern

se l l s th e l i gn i te to H ous ton

Lighti ng an d Power Com

pany (HL&P) under a contract that des ignat es N or t hwes t er n as H L&P’ s exc lusi ve su pp lier o f lign it e fo ra n ea r by p o we rpla nt in Fr ee st o ne Co un t y.

TCApu r ch as ed in 1 99 1 t he fee
- simp le e st at e ina 1 07
- ac r e t r ac t o f lan d lying wit hin and su rrou n de d en ti re l y b y th e Jew ett

Mine , t ak ing t it le subj ect t o No rthwest ern’s 1978 coal leases. So me two months af

ter ac quiri

ng i ts 107 acr es, TCA order ed Nor thwester n f rom the t ract because TCAhad concl

uded that Nort hwestern’ s two 1978 leases we re void. Holdin

g a con trary view, Northwe stern

co nt inu ed t o pr ep ar e t he 10 7- ac r e t r ac t fo rmining by r emo ving t he t o ps o il and so me si xty f eet of additional

overburden (earth an

d rock) t o gain

access to the li

gni te. To TCA ’s threa t of a l aw sui t f orlar ge da mag es , No r t hw es t er n r es po nd ed t ha t it wo uld by pass and n

ot mi ne TCA ’s 107 acres if TCA re fused t o a ckno wledg e No rt hwes t er n’s r ight t o mine them under i ts 1978 leas es. TCA ref used. Nort hwestern b

ypassed the 1 07 acres. TCA sued Northwe stern

in Freestone County district

co ur t for dec larat or y relief holding in val id a nd settin g aside No rt hwe st er n’s 19 78 lea se s, da mag es fo r r ea l-e st at e fr au d, and injunc t ive r elief.

Bef ore t rial, N or t hwes t er n gr at uit ou sly execut ed a nd r eco rd ed in t he de ed rec ords on Decem ber 10 , 19 93 , a

docum en t head ed “R elease of E xclusivity and License .” The do cument pro vides as foll

ows:3

As perm i tted b y [i ts 1 97 8 l ea se s] , N orth

we ste rn h as de ter m i n ed n ot to m i n e l i gn i te f rom t he [ 10 7 a cr es ], but in co nfo rmit y wit h r eq uir eme nt s o f l a w a nd ap plic ab le re gulat ion, No rt hw estern wil l cond uct rec l am

ati on opera

tions on th

e Property . In order to a fford TC A acc ess t o t he Pr op er t y and t he o ppo rt unit y to co nduc t mini ng opera ti on s th rough i ts o wn con tra ctor s or

l es se es ex cl us i v i ty of i ts r i gh ts a n d e sta te under the [1978 lea se s] an d to g rant a licen se to TCA, its successors and assigns, upon t he stated terms and conditions. * * * Northwe stern

h er eb y re l ea se s th

e ex cl us i v i ty of its ri ghts and estate under the [1978 leases] so that TCA, i

ts suc ces sors a

nd assi gns , shal l ha ve a ri ght, sub j ec t to ap plic ab le law and re gulat ion, to mi ne, m arket and sel

l c oal from the Propert y w

ithout lim iting the righ

t o f Northwe st er n t o c ont inue and co mplet e its re clamat ion and i nc i den tal operations on

the Prope

rty p ursuan t to its ri ghts und er the [1978 l eas es]. Nort hw estern

gr ant s t o T CA, it s su cce sso rs a nd as signs, a license fo r ingr ess a nd egres s t hro ugh t he Je wet t Mine t o t he Pr op er t y for t he pu rp os e o f exer cising t he ri gh ts herei n released to TCA, its succes sors and assi gn s. . . . The lice nse he r ein granted sha ll be ir r ev o ca ble un t il

such tim e as there shall

be other r easonable access av aila ble to a p ub l i c roa

d that d oesnot

require pas si

ng over land un

der the con trol or in the p os sess ion o f No rt hwes t er n. * * * TC A, it s s uc ce ss o r s a nd as sig ns, sha ll be s o lely r es po nsib le f or th ei r c om pl i an ce wi th all applic abl

e l aw and regul

ation an d shal l c onduct any op er at ions o n t he Property
. . . in a man ner that d oes not cause No rt hwes t er n t o be in violat ion o f any applic abl e l aw, regul ati on, reg ul atory perm i t condi tion or regul atory order. * * * In t he co ur se o f the Fr ee ston e C o un t y lit iga t io n, No r t hw es t er n a lso gr at uit o us ly executed and recorded i

n F ebruary

199 4 a d oc ument h eade d “ Su pp l em en t to R el ea se of Ex cl us i v i ty and License.” The document pro vided as foll ows: So me questions h

ave ari sen reg ard i ng the i nte nt of North we stern Re sou rce s C o. . . . i n f i l i ng th e Re l eas e of

Exc l usi vi ty a nd L i cense. . . .4

Th i s S uppl em en t . . . is fil ed t o c larify and re so lve any que st ions o f intent re gar ding the purpose and ef

fect of the Re le ase of Exc lus iv ity and Li cense. * * * No r t hw es t er n he r eb y gr an t s, se lls, an d c o nve ys a ll ri gh t, ti tl e, an d i n terest i n an d to t he coal and lignit e o n and u nder t he pr op er t y . . . t o T CA. Ad dit iona lly , Nor th we ste rn her eby relea ses a ny and all right , t itle, and int er est t o t he co al and l i gn i te under the Pr oper ty which i t claim ed under the Co al Leases , O pt ions a nd Rat ifi cat ion. Northwe stern

wan ts no m oney f or t he s ale o f an

y coa l or l i gn i te pro duced from the Pro pert y, by TCA or its assigns. * * * Northwe stern

ex pr es sly gr ant s TC A the right t o s ell coa l and l i gn i te f rom th e P rop er

ty to Houst on Lighti

ng & Power. To assist TCA i n th i s [reg ard], Nort hwestern wai ves it s right unde r t he Lignit e Su pply Agr eement wit h [H L&P] t o be t he exc lusive su ppl i er of lign it e t o Ho us t o n Lig ht ing & P o we r . T his w aiv er is giv en t o he lp s et t le t he dispu t e t hat has a risen be t wee n TC A and N or t hwes t er n [ an d] i s not a general wai ver of an y pr ov i si on of th e L i gn i te Supply Agreem ent, ot her than No rt hweste rn’s excl usiv e supplier rights, and then only to TCA and i

ts assigns. Northwe stern

acknowl edges that it i s now obliga ted to rec la im

the T CA P r o pe r t y. Nort hwestern does no t release t he Co al L ea se s, Op t io ns o rRa t ifica t io ns b ec au se it hasa co nt inuingobligat ion t o r eclaim the Propert y purs uant to bot h the Coal

Leases and appl ic abl e l aw. No rt hw ester n

agree s to a

ny de l i ve ry sche dul e m utua l l y ac ce pta bl e to H ous ton Light ing & Po wer and T CA.
Fo llowing a j ur

y trial, the Fre eston e C oun

ty di str i ct c our t re n dere d j udgm

en t th at T C A take nothi

ng b y i ts cl ai m s. TCA

appe aled f

rom th e j udgm en t. Wh il e the appeal

was pendi

ng, Northwe stern

notif ie d TCA that it i

ntended to replace the overb urden i t had taken

pre vi ous l y f rom t he 107-acre tract . This

was nec essary, according to No rt hwes t er n, to compl y wi th reg ulatory
re qui re men ts of t he Te xas Ra ilroa d Co mmi ssio n. T CA ap plied t o t he Fre estone Coun ty d i stri ct court f ora te m pora ry i njun cti on r es trai ni ng Nor th western f

rom repl aci

ng the overburden

until a fi nal2 T CA w as als o unsucc es sf ul i n f ed era l -cou rt su i ts agai ns t North we stern f oun de d up on al le ged an ti-trus t viola tions. See TCA Building Co. v. Northw estern Res. Co. , 73 F. Supp. 29 (S.D. Tex. 199 5); TCA Building Co. v. Northwes tern Res. Co. , 861 F . Supp. 1 366 (S.D . Tex . 1994)
. 5 de term i na ti on of TCA’s appeal. The trial cour t declin

ed to issue the requested inj unction and TCA appe aled f

rom th at order. Because T CA f

aile d t o es t ab lish t ha t it l acke d a n adeq ua te re med y at l aw , the a pp el l ate courtaff irm ed the di strict-court order ref usi ng to i ssue the

tem porary i nj unc tion
. SeeTCA Building Co. v. Northw

estern Res. Co. , 890 S.W.2d 175, 179 (Tex. App. —Waco 1994, no wri t). Nor th we ste rn th er eaf ter repl ac ed th e ov er b urden on TC A ’s 10 7- acretra ct. TCAi n i ti ate d th e p re se n t l i ti ga ti on i n a T ra v i s C oun ty dis trict court in

August 1995, cl ai mi ng a righ t to dam ag esbase d up on North

we stern ’s al l eg ed br each of contr act, fraud, tr espass, and i n terf er en ce wi th a contr act. Whi

le the present cause wa s p en di n g i n Tra v i s C oun ty , the a pp el l ate
co urtaf f i rm ed on i ts m eri ts th e j udgm en t of th e Fre eston e C oun

ty di str i ct c our t th at T CA

tak e not hingby its claims for dec larat or y relief holding invalid No rt hwes t er n’s 19 78 lea ses, damag es, and injunct iverel

i ef
. See T CA Bu ilding Co. v. Northw estern Res. Co. , 9 22 S .W. 2d 6 29 ( Te x. App.—W aco 199 6, wri

t deni ed). 2 Northwe stern

move d f or s um mary j udg men t i n th e Trav i s C oun ty l aw sui t. W e n ow reviewthe trial

court ’s sum

ma ry j udgme nt that TC A ta ke no t hingb y i ts c l ai m s f or b re ach of con tra ct, fraud, tres

pa ss , an d torti ousi nte rf ere nc e. The j udg men t al so den i esTCA ’s com pe ti ng m oti on f or sum mary j udgm en t. TCA contends gen

erall y tha t t he trial court erred in

both respects. We revi

ew t he re co rd and det er mine anew a ll i ssu es r aised by

the grou nds a ss erte d i

n th e re sp ec ti ve moti ons f or3 Ref errin g to TCA’s

righ ts under the Rel ease and Supplem ent, Mr. Embry

testifi ed as foll ows: (a ) N or t hwes t er n was willi ng t hat TC A mine the c oa l if TC A though t i

t wa s worth $50,000,000; ( b) he co uld se e n o r ea so n w hy T CA c o uld not mine the coal i f i t obtai ne d the ne ces sary perm i ts fro m the Tex as R

ail road Com m i ssi on; (c) North

wes tern woul d n ot se ek com pe ns ati on f rom TCAf orremovi ng the overburden

from the 107 acres, but “j ust step o ut of th e w ay ” a n d “ coop erate wit h” TCA’s eff

ort s to remove the lign

ite; a nd (d) Northwestern would stockpile overburden m aterial adjac ent t o t he 10 7- acr e t ra ct t o fa cilitat e T CA’s r eplac ement of t he o ver bur den. 6 sum mary j udgm en t. See Hanson v. Republic Ins. Co. , 5 S. W.3d 324, 32 7 (Tex. App.— Houst on [1st Di st.] 1999 , pet. den

i ed).
BREACH OF CONTRACT The contract ma

de the basis of TCA ’s br each-of -con tract cl ai m al l eg edl y aros e f rom t he R el ea se of Excl

usi vi ty an d Li cense a

nd the Supplem

ent to Release of

Excl usi vi ty an d Li cense. We ha ve he retofore set out at l ength the term s of the two i nstrumen ts. For con

veni ence h ereaf ter,
we wil l ref er to them s im

ply as the “R

el ease” an

d the “Suppl

em en t.” No rt hwes t er n’s o bligat ions
ar ising fro m thes e t wo instr ument s we re aug mente d, acc or ding to TCA, by certain s tatements m

ade by M r . E mbr y in h is t es t imo ny d ur ing t he t r ial o n t he mer it s in Fr ee st o ne Co un t y. 3

If we un de r st an d c o rr ec t ly TC A’s live p et it io n, it alleges t he Relea se a nd S upp lement
am ounted to contractual promises alleged ly breache d b y Nort hwestern. Thes e promi ses reduce mainlyto the

br each of a single o bligat ion: an

al l eg ed con tra ctual un derta ki n g b y Nor th we ste rn to al l owTCA a rea sona bl e am ount of tim e (an d thus an opportuni

ty to m i ne and se l l the l i gni te) be f ore Northwe stern

replac ed the overburden

on t he 107 -a cr e t ra ct . T he so le issue o n app eal, acc or ding to TCA, i s whether

the tr ial cour t err oneously construed t he Release and Supp l em en t whe n the court refuse d t o impu t e s uc h an implied pr o mise t o t ho se inst ru ment s. TC A co nt end ed fo r th at im pli ed4 TCA contends the tri al court was requi

redb y th e f oll owi n g r ul es of con str uc ti on to i m pu te such a prom i se to the Rel eas e an d Supp l em

en t: In arrivi ng at t he i

ntent o f a grantor, a cour t must construe the express l

anguage of

a convey ance strictly agai

nstt he gr ant or , includ ing t he t ext of a ny res erv ati on co nt ain ed in t he ins t rum en t , an d h ar mo niz e it s p ar t s w he r e n ec es sa ry t o effe ct uat e t he purpo se of

th e g ra n t an d to transf

er to th e gr ant ee t he larg est est at e t hat is co nsist ent wit h t he l anguag e em

ploye d. SeeBalandran v. Safeco Ins. Co. , 972 S. W.2d 738 , 74 1 (T ex. 1 998 ); Dallas Pow er & Light Co. v. Cleghorn , 62 3 S. W.2d 310 , 31 0-1 2 (T ex. 1 981 ); Terrell v. Graham , 576 S.W.2d 610 , 61 2 (T ex. 1 979 ); Rio Br avo Oil C

o. v. Weed, 50 S.W .2d 108 0, 1087(Tex . 1932) ; Cartw right v. Trueblood , 39 S.W. 930, 931 (T ex. 1 897 ); Curdy v. Staf ford , 3 0 S .W. 551 , 5 52 ( Te x. 1895)
. 7 pro mise in its mot ion fo r p ar t ial summary judgment
. 4 By rep lac ing t he o ve r

bu r de n p r ema t ur ely,
acc or ding to TC A, N or t hw est er n made it imposs ible for T CA t o mine t he lignite p ro fitably and foreclosedTCA’s

oppor tunity

to reali ze an expected profi

t o f $36,000,000 f

rom se l l i n g th e l i gn i te to HL&P. Nor

th we ste rnmove d for summary judg ment o n t he gr ou nd t hat t he Re lease a nd Su pplement wer e given w itho ut co nsider at ion, pr eclud ing any co nt r ac t ua l o b l i ga ti on s on i ts p ar t, whether express or i

mpl ie d. It appears undis

puted that T CA i

tsel f gav e no promi se or ot her
co nsid er at io nin

exch an ge for the Rel

ease an d Supplem

ent. It is not necessa

ry, h owever, that an off eree it se lf f urni sh the c onsi derati on; i t ma y be gi ven b y another pe

rson . SeeRestatemen

t (Seco nd) of Con tra cts § 7 1( 4) (1 98 1) . It is ess en tia l , however, that the

cons i derati

on b e b argai

ne d f or. Id. § 71(1). “A perf

ormance or ret ur n p r o mise is ba r ga ine d fo rif it is s o ug ht by t he pr o miso rin exch angefo rhis pr omise a nd

i s gi ven b y the promi

see [or another] i

n excha nge f or that prom

i se.” Id. § 71 (2) (emphasis ad ded) ; see also id. § 71(4 ).

TCAar gues that Nor thwestern recei ved consi

deration i n the f orm of tactical advan tages it gain

ed in the Freesto ne County trial b y reason of the Re le ase and Supp l em en t. F or8

exam ple , TCA contends t he purpose o f the two instruments was “to negat e TCA’s cl ai m” in that law su it “that Nort hwestern was holdi ng the [107-acre trac t ] ho stage to the Jewett Min e— t hre at ening to mi

ne around and bury the coal unl ess TCA exec ut ed r at ifi

cat ions of [No rt hweste rn’s 1978] Coal

Leas es. ” And No rt hwes t er n was able t o a rg ue a t t rial t hat t he Re lease a nd S upp lement
em bodie d a se t t leme nt an d c o mpr o mise o f T CA’ s c laims
. Whe t he rt he se as se r t io ns a r e t rue is immat er ial. Not hi

ng i n the recor d suggests t hat su ch t ac t ica l a dvan tag eswere e i

the r prom i se d or giv en by any one in exchangefor any

obli gations unde rt ake n by Nor t hwes t er n in the R elease and S up ple me n

t. Mo re ove r, we be lieve TCA’ s ar gument misconc eives t he nat ur e o f the Relea se a nd Su pp l em en t, wh ich No r t hw es t er n vo lun t ar ily and gr at uit o us ly executed and reco rded. T he Release and Su pp l em en t am oun ted to Nort hwestern’s non-promissory offer of t he l eg al

ri gh ts tr ansf er re d to TCAin the t wo instr ument s, w het her or not t he off er in cl uded as an i

nci dent an i mpl ie d pr om i se to forbear f rom r epl aci ng th e ove rbu rden f or a reas onab l e peri

od of ti me. See id. § 55. Nor thwest ern’s performa nceof any resul ting contractwo uld have been “c omp lete at t he moment of a cce pt ance ” by TCA
. Id. cmt. b.

Co nver t ingNor

th we ste rn ’s n on -p rom

i ss ory of f er i n to a contract r equi

red that T CA acceptthe of f er b y som e m an i f es tation of

as se n t to the term

s of the R eleas e an d Supp l em

en t. See id. §§ 3, 9, 17, 2 3, 35(1 ), 50(1), 5 5 cm t. b. Fo r t he reasons di scussed b el ow in c onnecti on with the l egal eff ect o f t he Re lease a nd S upp lement a s a r eco rd ed c onve yance, TC A did no t acc ept t he No rt hwes t er n offer (t her eby creat in g a cont ract w ith Nort hwestern) because TCA mani fested as a matt er of law an inte nt ion not to accept t he terms of the two instruments.5 Seenote 4, supra. 9 In su pp ort o f it s bre ach- of- co nt ra ct t heo ry, T CA re lies upo n judicial dec isions involvingthe pro per co nstruct ion of convey ances. 5 We will t her efo re add re ss t he lega l effect of t he Rel ease an

d Supplem

ent as a convey

ance. The Re l ea se

an d S uppl em en t toge th er pu rp ort to convey

an i n terest i n re al pr operty
acc or ding t o t he t er ms st at ed t her ein. N or t hwes t er n e xecuted and de l i v ered th e two i n str um en ts withoutrequiri

ng consi deration i n exchan ge. I n a dd it io n, ho we ve r , No r t hw es t er n it se lf re co rd ed t he i n str um en ts in the d eed re cords of Freestone County. This act gave ri se to a presumption that Northwe stern

(even t ho ug h it re ce i

v ed n o con si dera ti on) “ di d s o f or th e pur pos e of gi v i n g e f f ec t to [e ach] in strumen t as a convey

ance.” Ford v. Hackel , 7 7 S .W. 2d 1 043 , 1 044 (T ex. 193 5) . T he pre su m ption was re but t able, how ever , by a sho wing that T CA, the grantee named in the instrumen

ts, rej ected th

e con veyance. Id. at 1045. The validity o f the Relea se a nd Supplem ent as a convey

ance, and the authority

granted t he r ein t o T CA, d er ived fro m and de pend ed u po n t he co nt inued e xiste nce a nd va lid it y o f Nor thwest ern’s l ea se

h ol d e sta te u n der i ts 1978 co al l

eases. Af ter N ort hwestern reco rded t he Release and Supplem

ent, TCA obvi

ously assai le d its own powers and ri ghts thereunder b y

con tin ui n g to pr ose cu te its caus e of action f

or declaratory j udgme

nt that Nor thwest ern’s le asehol d under the 1978 le ases was “v

oid ab in itio.” TCA continued to press thi s contention un til the ma tt er wa s fi na lly deci ded adve rse ly to TC A’s claim on a ppe al, a lmost t wo years aft er t he Relea se a nd Suppl em en t were recorded. See TCA Building Co. v. Northwe stern Res. Co. , 92 2 S. W .2d at 3 3-3 6. W

e h ol d as a ma tt er of law that TCA’s conduct in this regard amounts to a rejecti on of the conve ya nce em bodie d10

in the Release and Supp l em en t. SeeRestatem

en t (Second) of

Contracts § 38 cm

t. b (198 1). (o ff eree’s power of acceptance termi nated by words or conduct justi fy in g in feren ce tha t of feree i nten ds n ot to acc ept of

f er). For the reasons statedab ove , we hol d the R el ea se an d Su ppl em en t did n ot giv e rise to a con tractual or bi ndi ng r elati onsh i p be tween TCA and Northw estern . Co ns eq ue nt ly, th ere ex i sts
no co nt r ac t t o wh ich o ne may imp ut e t he ne ce ss ar ily impli ed p ro mise for which T CA co nt ends . T he trial cou n t di d n ot er r i n i ts ord er th at TCA take nothin

g by its b reach-of-contract clai

m. A nd, as discussed h

ereafter, our holdi

ng i n this regard is al

so dispositive of TCA ’s remai ni ng cl aim s. FRAUD In i ts l i v e p eti ti on , TCA

al l eg ed a c au se of ac ti onfor comm

on-law f raud and a statutory cause of action f

or fraud involving a r eal-e st at e t ra nsac t ion. SeeTex. Bus. & Com . Code Ann. § 27.01 (We st 1991 ). If we un derstand correctly

TCA’s alle gations, asam

pl i f i ed i n i ts b ri ef on appeal, TCA alleged f

raud in the fol

lowin g three par ticulars: 1. The trial

court erroneously

construed the R el ea se

an d Su ppl em en t asnot
co nt aining

an i mpl ie d p romi se b y Northwe stern

to del ay f or a reas onab l e peri

od of ti me b ef ore re placing t he ove

rburden on TCA’s 107-acre tract ; an

d the court rejected TCA’s f raud cla im based upon t his e rr o ne o us co nst ruc t io n. Un de ra c o rr ec t int er pr et at io n o f t he Re le ase and Supp l em en t, those documen

ts im ply such an o bligat ion o n No rt hwes t er n’s pa rt , a nd TCA i s enti

tled to a jury

trial
on th e iss ue of wh eth er Nor th we ste rn made th at i m pl i ed pr om i se wi th an i n ten ti on n ot to ke epi

t. 2. If, ho we ve r , t he t r ial c o ur t co rr ec t ly co nst ru ed t he Re lease a nd Supplem ent, then t he Rel ease a

nd Suppl em ent them sel

ves am ounted to fraudul

ent representations m

ade “to escape11

liabil ity in the Freesto ne County [t] rial ” and TCA

is entitled to a jury tri al

“on the i ssue of wh

ether [N or t hwes t er n] f

raudu l en tly use d the Rel eas e an d Supp l em

en t . . . t o a void liabil

ity in the Fre est one Coun ty tri al and def raud TC A.” 3. Af ter the F reestone coun

ty tri al on the meri ts, Mr. Emb

ry threatened to replace t he overburden “unless TC A i m med i ate l y ag re ed to as su me [Nor th we ste rn ’s ] re tai n ed ob l i ga ti on to recl ai m ,” that is to sa y, Nor thwest ern’s reg ulato ry obli gat ion to replace t he overbur den on T CA’s 107-a cretract. Ac cordi

ng to TCA, thi s thre at dem onstra tes North wes tern ’s i

nten t , at t he t ime it recorded the R

eleas e an d Supp l em

en t, not to perf

orm it s obl i gation to fu

rnish the m aterial s nece ssa

ry for re placing t he ove rbu rd en. So much is implied by the post-t rial

threat because Mr. Em

bry knew at the tim

e he m ade the threat t ha t T CA d id n o t ha ve t he ne ce ss ar y re pla ce men t mat er ial, Nort hwestern h

avi ng used the m

aterial for recl am

ation elsewhere i

n the Jewett Mi

ne. Northwe stern

mov ed f or sum mar y j udgm en t ag ai n st T CA ’s f

ra ud c laims on t he gr ou nd tha t TCA coul d n ot reasonabl

y h ave rel ie d upon any

al le ged misrepresentat ions i

n the Release
an d S up ple men t o rMr
. E mbr y’s t es t imo ny in t he Freestone County tri al . The trial court sustain

ed this part o f Northwest ern’s m ot ion and ordered t hat TCA take nothing by its fraud claim

s. An essen tial e l em en t of a c om mon- l aw f rau d a cti on i s a pl ai nti f f ’s rea son ab l e or jus t ifiab le re liance up on t he de f en da nt’ s a l l eg ed m i sr ep res en tati on, wh i ch rel i an cei nd uc ed ac ti on or i na cti on on the pl ai ntif f ’spart an d cau sed hi m pecu ni ary l oss. SeeErnst &

Young, L.L.P

. v. Pacific Mut. Life Ins. Co. , 51 S. W.3d 573 , 57 7 (T ex. 2 001 ); Form osa Pl astics Corp. v. P

resid io Eng’rs and Contractors, Inc. , 960 S.W .2d 41, 4 7-48 (Tex. 19 97); Re sta tem en t (Se con d) of Torts, § 537 ( 1977)
. Proof o f su ch r elia nc e is als o ne ce ss ar y t o sust ain a fra ud a ct ion u nder t he T exas Bus iness and12

Comm erce Code. SeeT ex . Bu s. & C o m. Code Ann. § 27 .01 (a) (1) (B) (West 199 1); Schlumberger Tech. Corp. v. Sw

anson , 959 S.W.2d 171, 182 (T ex. 199 7) . T he no n-e xiste nce o f any of th e r eq ui si te el em en ts of a f raud a cti on, wh ethe r as a matter of l

aw or f ac t, i s f ata lto the c l ai

m . See Stone v. Law yers Title Ins. Co. , 554 S.W .2d 183 , 185 (Tex. 19 77).

We concl ude as a m

atter of l aw tha t TCA ca nn ot rea son ab l y orjus tif ia bl y h ave rel ie d up on an y repres en tations con tai ne d i n th e R el ea se an d Su ppl em en t or th e tri

al tes ti mony of Mr
. E mbr y, that T CA

co uld no t have act ed o r r efra ined fro m act ing base d o n any suc h re pr ese nt at ion,
and tha t TCA c oul d not hav e su stai ne d a pe cun

i ary l oss c aus ed b

y such re l i ance. We have he ld abo ve t hat TC A rejec t ed t he t er ms and t he co nveyance embod ied in t he Release and S upp lement. The re exist ed no contract between the pa rti es ; th e tri al j udg e’ s c ons

tructi on of t he Re lease a nd S upp lement is im ma terial . TCA’s rej ection of Northwestern’s off er is inh er en t ly in consi stent with the rel

ia nce requi redf or a f raud a cti on. See Dvorak v. A merican Fam. M ut. In s. Co. , 508 N.W.2d 329, 332 (N.D. 1993) (As a m atter of law, no reli

ance can be f ounded on alle ged misrepr ese nt at ions contain ed i n off er rej ected b y off eree .). In the Sw

anson deci si on me

ntioned a bove, t he pla in tif fs based thei

r fraud cl ai m on a n alle ged mi srepresentation b

y the defen dants that in

duced pla int iffs to sell thei

r propert y to defen

dants at a low pri ce. In t he t ra nsac t ion, ho we ver , t he p laint iffs executed and gav e a rel ease di sclai

mi ng that they

had rel ie d upo n any rep re sent at ions mad e by the defendan ts. The c our

t h el d th e d i sc l ai mer con cl us i v el y n eg ate d th

e r el i an ce el em en t n ec es sa ry to pr ove the p l ai

ntif f s’ f raud c l ai m . See Schlumberger Tec h. Corp. v. Sw

anson , 959 S.W.2d at 177-80. We se e n o mat er ial d iffe r en ce be t we en a d isc laim er r en o un cin g a leg al r ig ht t o r ely u po n a repres en tation and a reje ction of the represe ntation i n the f irst i nstance. In ei

ther case, no dependen

ce13

o rco nfid en ce is pl

ac ed upon the repres en tati on as a basis f or a c l ai m of l eg al righ t. A s a matte r of la w, TC A’s r eject ion o f the alleged misrepr ese nt at ions in the Relea se a nd S upp lement p re clude s t he
essen tial el em ent of relia

nce. We ho ld t he t ria l co ur t did no t er r in it s o rd er t hat TC A t ak e no t hing by it s fr a ud clai ms. TRESP ASS A cause of action s eeki

ng dam ages bas ed on ci

vi l trespass requires a

n una uthorized phy si cal en try u pon a nothe r’sl and. See Cain v. R ust Indus. Cleaning Servs., Inc. , 969 S.W.2d 464, 470 (T ex. App .—T exark ana 19 98, pet . de nied); Ward v. Northeas t Tex. Farmers Co-op Elevator , 909 S.W.2 d 143, 1 50 (Tex . App.—Tex ark ana 1 995, w

ri t deni ed). TCA a

ll eged Northwe stern tres pa ss ed upon TC A’s 10 7- acr e t ra ct by rep lacing t he o ve r bu r de n a nd ge ne r ally u sing t he t r ac t in the c ourse of

operati ng th e Je wett Mi ne , contrar

y t o co nt r ac t ua l pr o mise s c o nt ain ed in the Release and Su pplement , a nd Mr . E mbry’s t est imony i n the Fr eestone Coun

ty tri al . In i ts m otion f or sum mary j udgm en t, Nort hwestern cont ended its a ctions wer e lega lly just ifi ed. The t rial co ur t sus t ained t he
mo t io n a nd o r de r ed t ha t T CA t ak e n o t hing by it s t r es pa ss cla im.

Nor thwest ern’s ent ry up on t he 107-acre tract was not unauthorized as a m atter of law b ec ause Nort hwestern possessed t he necessary autho rity under i

ts 1978 coal leases

unl ess TCA acqui reda su per ior right of p os sess ion by re aso n of t he Re lease a nd Su pp leme nt . T CA t o o k t it le to t he 10 7- acretra ct subject

t o t hos e lease s and No rt hwes t er n’s au t hor ity t her eund er . T he Relea se a nd Su pplement did no t vest a su per ior right in TCA bec aus e, as w e have held abo ve, TC A rejec t ed t he conveyan ce emb odied in

those t wo instruments.14 We hold, theref

ore, that the

tria l court did not err

in or der ing t hat TC A ta ke no t hing by it s t r es pa ss cla im.
TORTIOUS INTE RFERENCE WI TH CONTRACT

TC A al l eg ed Nor th we ste rn torti ous l y i n terf ered wi th TCA’s c ont rac t t o se ll

HL&P any li gni te mi ned from TCA ’s 107-acre t ract. The all eged acts o f i

nterference were as foll

ows: Nor thwest ern’s failu r e t o pr o vid e s up po r t an d fa cilit ie s t o T CA as p ro mised in the Relea se a nd Su pplement and M r. Embry’s t est imony in the Fr ees t one Co unt y tr ial; Nor t hwes t er n’s r eplac ing t he overburden

on TCA’s

tract ; an d certain s

tatements m

ade by No rt hwes t er n repr es en

tati v es at a meet ingof bi

dd e rsse ek

i n g to c on

tra ct wi th TC A f or th e w ork of m i n i n g th e 1 07 -a cre trac t. Northwe stern

move d for sum

ma ry j udgme nt on the ground that its conduct in each in stance wa s “in t he ex ercise a

nd protecti on of

[Northwe stern ’s ] sup erior ri ghts and obl i gations.” The tria l court
su st ain ed t he mo t io n a nd o r de r ed t ha t T CA t ak e n o t hing by it s c laim.

We concl ude as a m

atter of law that the conduct attr ib uted to Nort hwestern was not
ac t io na ble and not t he cause of a legal i nj ury to T CA. This nec essari ly fol lows f rom our previous
con cl us i on that T CA ac qui re d n o ri gh t to m i n e th e l i gn i te on th e 1 07 -a cre trac t th at w as su perior to Nor thwest ern’s righ

t t o do so. T CA

took fee-s im ple title to the tract subj ect to Nort hwestern’ s 1978 coal leases and rejected No rthwest ern’s convey ance em bodied i n the Release

an d S up ple men t . I t is not conten ded that Northwe stern

exceeded i

ts rights an

d powers under

t he 19 78 lea ses. We ho ld t he
ac ts of i nterf eren ce al l eged agai nst Northwes

tern w ereth eref

orewi th i n i ts l eg al au th ori ty and j ustif ie d
as a m at ter of l

aw. See Texas Beef Cattle Co. v. Green , 921 S.W.2d 203, 211 (Tex. 199 6)
.15

Ac co r di ng ly, the trial

co ur t did no t er r in o rd er ing t hat TC A ta ke no t hingby its tort ious-i

nterferen ce cla im. Fi

n di n g n o re v er si b l e error , w e af

f i rm th e tr i al cou rt j udgm en t.

John E. Powers, Justice Bef ore Jus tic es K i dd, Ye akel

and Powers * Af fi rmed File d: March 28, 2002 Publish16 * Bef ore John E. Po wers, Sen

i or Justi ce (retire d), Thi

rd Cou rt of A pp ea l s, si tti n g b y as si gn men t. SeeTex . Gov’ t Code A

nn . § 74.00 3(b ) (We st 1998 ).