Reversed and Remanded and Memorandum Opinion filed March 8 , 2022

.

In The 

## Fourteenth Court of Appeals

NO. 14

- 20

- 00836

- CV

IN THE ESTATE OF BENTON SCHULZE, JR.

On Appeal from the County Court at Law Washington County, Texas Tr ial Court Cause No. 91

- 4 56

MEMORANDUM OPINION
This appeal arises from a probate dispute. Appellant
, Kay Lapaglia Schulze
Domel
, appeals the trial court ’ s grant of summary judgment in favor of Appellee, Evelyn Perry Leiber Schulze
, contend ing the trial court erroneously gr ante d summary judgmen t and dismissed Kay ’ s clai ms with prejudice because ( 1) Evelyn ’ s summary judgment motion failed to address Kay ’ s fraud claim ; and (2)
the mediated settlement a greement Kay and Evelyn signed is laten tly ambiguous regarding what rights
, clai ms, and assets were settled by the parties in this probate dispute

. We reverse and remand.2 B ACKGROUND
Benton Schulze, Jr. die d December 7, 1991
, le aving his property in a
handwritten will to his wife
, Evelyn Perry Leiber Schulze , and to his son from a pri or marriage , Benton W. Schulze II I , “ to sh are and share alike. ” Evelyn file d an Application for Probate of Will and Issuance of Letters of Administration i n December 1991 , and the t rial court sign ed an O rder A dmitting Will to Probate and Authorizing L ette rs of Administration i n January 1992. Evelyn file d an invent ory in June 1992, whi ch the trial court approved
, listing all of Schulze, Jr. ’ s property and corresponding value , except for the value of “ oil and gas leases and mineral
interests ” which is l iste d a s “ unknown. ”

In September 2001, Evelyn file d an Account for Final Settlement , in which
she list ed (1) income received by Schulze, Jr. ’ s estate f r o m leases
, royalties
, and
interest from 1995 to 200 0 ; ( 2) debts of Schulze, J r. ’ s estate ; and (3) real and

pe rsonal property

. Schulze III filed Objections to Accou nt for Final Settlement and Claims against Decedent ’ s Estate in January 2002
, com plain ing that Evelyn
, among other thin gs, failed to provide accounting information from 1992 to 1995 a s well as i dent if

y the sources for various cash receipts and royalty income. Evelyn ’ s Account for Final Settlement was never approved by the court.

Schulze III died on December 9, 200 6

. His wife Kay , as an interested person in Schulze
, Jr. ’ s estate as t he sole devi see of S chulze III , filed an Application to Remove Independent Executrix and to Appoint Successor Independent Executrix i n February 2007 . Kay requested Evelyn ’ s removal
because Evelyn (1) failed to file an Inventory, Ap praisement, and List of C laims
with in 90 da ys of qualification; (2) failed to “ file an accounting as required by law
because her Account for Final Settlement was filed without the required vouchers and/or receipts; ” and (3) “ has not performed her duties and has failed in the3

perfo rmance of her d u ti es as Independent Executrix because she has not made progress in settling or distributing the Estate in over fifteen (15) years. ”

In April 2007, the t rial court order e d Evelyn and Kay to mediation

. The
mediation resulted in a Rule 11 Memorandum of Me d i a ted Settlement Agreement ( “ the Agreement ” ), which Kay and Evelyn signed in May 2007

. Among othe r things , t he Agreement stated that (1) it was signed i n settlement of “ any and all claims belonging to Benton Schulze, III, his heirs, beneficiaries, a ssign s o r anyone claiming under him to assets and distributions of the ” Schulze, Jr. estate ; and (2) Kay and Evelyn “ waive and release any and all claims, judgments, and causes of actions they have or may have against one another or against any personal

re prese n t a tive of the other

. ”
The parties filed a Joint Motion to Approve Settlement Agreement i n July 2007, stating they have “ entered into an agreement settling all i ssues between them
relative to [Schu lze, Jr. ’ s estate] and move the C ourt to approve the S ettle m e n t Agreement and authorize [Evelyn] to execute any and all documents necessary to
carry out the terms of the Settlement Agreement on behalf of the Estate of ” Schulze, Jr. The trial court signed an order i n July 2007, approv ing the Agreement
and ord ering E v elyn to exe cute all deeds, releases, or other nec essary documents to carry out the Agreement. I n October 2007, Kay filed a Motion to Enforce R ule 11
Memorandum of Mediated Settlement Agreement requesting the trial court order Evelyn to comply with the t e r ms of the Ag reem ent. Kay withdrew her motion i n May 2008 , stating “ [ t ] here is no need to pursue that motion ” any longer.

I n June 2015, Evelyn filed a Motion to Convert to Independent
Administration . A few weeks later , Kay filed an objection to th e mot i o n , stat ing

t hat Evelyn ha d p rovided no acco unting for numerous miner al interests set forth in
the 1992 inventory and requesting Evelyn account for all mineral interests. I n4

August 2015, Kay filed a Motion to Demand Accounting , requesting Evelyn fil e all p a st due ann ual accountings by September 1, 2015. In August 2015, t he trial court granted Kay ’ s motion and ordered Evelyn to file all past due annual accountings no later than 60 days from the execution o f the order. Evelyn filed an
Accou nt o f Esta te i n D e cember 2015

. The trial court signed an Account of Estate
Order i n January 2016, approving the Account

. About six months ther e after
, Kay filed a Motion to Inspect Supporting
Documentation of Account of Estate (1) stating she sent a letter to the trial c o urt

re questing that it reject Evelyn ’ s Account of Es tate but that the court did not see the letter before signing its order ; and (2) requesting to inspect supporting
documentation

. Three days later, Evelyn filed a response, in which she , among oth er th ing s , claimed that “ [e] xt ensive discovery was conducted by attorneys representing Benton Schulze, III and Kay

. Any and all claims by either party were
settled at the mediation he ld on May 25, 2007 and the settlement was reduce d to a Rule 11 Agreement whic h w as approved by the Co urt

. Pursuant to the terms of the Rule 11 Agreement, Evelyn has made all distributions required of her to Kay. Kay has accepted the benefits of the Rul e 11 Agreement and the distributions made to her pu rsuant thereto. ”

I n Jul y 201 6, Kay filed an Amended and /or Supplemental Application to Remove Independent Executrix and to Appoint Successor Independent Executri x , claiming that “ sufficient grounds appear to exist t o support a belief ” that Evelyn
has “ c ommitted fraud, embe zzled or mi sap plied or is about to commi t fraud, embezzle or misapply or at a minimum has been negligent and/or breached her fiduciary duties as Executrix

. ” Several days later, Kay filed a Petition for Declaratory Judgment. In May 2017, Kay filed an a mended p e titio n s eek ing a declaratory judgment that (1) she is “ an interested person in the Administration of5

the Estate of Benton Schulze, Jr. ” ; (2) Evelyn “ breac hed her fiduciary duty as
Administratrix of the Estate of Benton Schulze, Jr. ” ; (3) t h e “ Rul e 11 Agree ment is
void be cause Administratrix failed to obtain the C ourt’s approval prior to negotiating and entering into th e Settlement Agreement ” ; (4) the “ Agree ment is
void on grounds of extrinsic fraud ” ; (5) the “ Agreement covers only the surface

pro perty and p erson al property specifically enumerated therein, and in accordance with the principles of contract law, additional subject matter not contained within
th e Ru le 11 Agreement is not part of the scope of the settlement ” ; and (6) th e Agreem ent contai ns a late nt am big uity so parol evidence should be considered to show that Evelyn and Kay did not intend for the “ Agreement to include the 106 mineral, oil and gas inte rests and mineral and / or royalty interests for which a value
was never ascertain ed

. ”
Evelyn filed an an swe r i n May 2017 , generally denying Kay ’ s allegation and pleading the affirmative defense s of “ accord and satisfaction, estoppel, fraud, laches, paym ent, release, statute of limitations and waiver. ” E velyn also filed a
Motion to Di smiss for Lack of J urisd ict i on , asserting that (1) the “ Rule 11
A greement was intended to be and on its face was a complete settlement of any
and all claims any party had ag ains t the other ” ; (2) Evelyn “ has made all distributions required o f her to [Kay] pursuant to the term s of the Rule 11 Agreement

. [ Kay ] has accepted the be nefits of the Rule 11 Agreement and the distributions made to her pursuant thereto ” ; and (3) Kay ’ s “ allege d causes of action should be dismissed due to lack of juris diction because [ Kay ] has no standing in

t his matter [and] ceased to be an ‘ interested person ’ when she e ntered into the settlement agreement and accepted the benefits therefrom. ”

I n D e cember 2018
, Evelyn file d a summary judgment motion , arguing (1) Kay has “ no standing to br ing any action in this pr oceeding because she is no6

longer an interested party ” after she and Evelyn signed the Agreement settling

“ any and all claims belongi ng to [Kay] or anyo ne claiming under Benton Schulze,
III ” ; and (2) it is “ clear that all parties had the same knowl edge or means of obtaining the same knowledge and there was no fraud, misrepresentation, concealment, or conduct otherwise inequitable on the part of [Evelyn] w hen the Rule 11 Agreement was executed or at any other time. ” About two months later, Kay filed h e r r e s p o n s e and assert ed that (1) she is an interested person because t he Agreement “ was not intended t o settle any oil, g as and mineral leases, or mineral and/or royal ty interests in the Estate of Benton Schulze, Jr. ” ; (2) the Agreement is
clear and una mbigu ous and “ was drafted to settle only the person al property and surface property which was specificall y identified within the four co rn ers of the
Rule 1 1 Agreem ent, and that had been valued in the 1992 Inventory ” ; and (3)
al ternatively, if there is an a mbigu ity in the Agreement
, “ there i s a genuine issue of material fact wherein the Court and/or a jury wi ll need to consider a ll pa rol []
evidence in a full t rial on the merits. ”
Evelyn filed her reply in July 2020, objecting to Kay ’ s summary judgment
eviden ce an d a rguing that Kay is no lon ger an interested party as defined by the
Texas Estates C ode and has no standing to bring an y action against Evelyn becaus e the Agreement unambiguously “ states it is ‘ in settlement of an y and all claims belonging to Benton Schul ze, III, his heirs, beneficiaries, assigns or anyone claiming under him to assets and distributions of the above describ ed estate and the part ies agree as follows. ’ ” The trial court held a hearing on Evelyn ’ s motion for summary judgment i n September 20 20, at which Kay and Evelyn presented argument. The trial court signed a Final Summary Judgment on Nov ember 17, 2020,

sta t i ng that Evelyn ’ s summary judgment motion should be grante d and finding that7

Kay has “ no standing in this matter and her Application to R emo ve Independent Executrix and to Appoint Successor Independent Executrix and Petition for
Declara tory Judgment are dis missed with prejudice

. ” Kay f iled a timely notice of appeal on December 16, 2020.

I SSUES P RESENTED Kay present s the following two issu es on appeal: (1) Because Evelyn’s motion for summary judgment did not address Kay’s fraud claim, a nd Evelyn’s defense o f release cannot defeat the fraud claim, the probate court erred in granting summar y judgment and dismissing all Kay’s claims. (2) At a min imum, the circumstances leading to the mediated Rule 11 Agreement reveal a latent ambiguity as t o what Kay released, so the probate court erred in finding it unambiguously released all her previously undisputed half

- interest in Benton Jr.’ s estate. A NAL YSI S

We b e gin by addressing Kay ’ s first issue
, in which she asserts that the trial

court erro neousl y granted summary jud gmen t in favor of Evelyn
, determin ing Kay lacked standing and dismiss ing Kay ’ s claims when Evelyn ’ s summary judgment
motio n (1) “ only ad dre sse d her defense of release ” and (2 ) did not address Kay ’ s clai m that Evelyn “ fraudulently i nduced the Rule 11 Agreement and release ” of Kay ’ s half

- interest in Schulze, Jr. ’ s estate. Kay contends that Evelyn “ committed
fr aud by failing to disclose mate ria l information about the estate’s assets prior to

en tering the Rule 11 Agreement
, ” and whe n a n administrator “ misrepresent s th e value of an estate to obtain a release from one of the beneficiaries, the beneficiary retains standing to seek t he administrat or’ s removal and recover damages for
fraud. ” Standard of Review8

We review a trial court ’ s rulin g on a motion for summary judgmen t de novo

. Tarr v. Timberwood Park Owners Ass ’ n , Inc. , 556 S.W.3d 274, 278 (Tex. 2018); Texan Land & Cattle II, Lt d. v. ExxonMob il Pipeline Co. , 579 S.W.3d 540, 542 (Tex. App.

— Houston [14th Dist.] 2019, no pet.). To prevai l on a trad itional
motion for sum mary judgment, the movant must show that no genuine issue of material fact exists and that it is entitled to judgm ent as a matte r o f law. Tex. R. Civ. P. 166a(c); Tarr , 556 S.W.3d at 278

. Summary judgment for a defendant is proper only when the defendant negates at least one element of each of the plaintiff ’ s theories of recovery or pleads and conclusively establish es each elemen t

o f an affirmative defense. Hilburn v. Storage Tr. Props., LP , 586 S.W.3d 501 , 506 (Tex. App.

— Houston [14th Dist.] 2019, no pe t.); see Tex. R. Civ. P. 166a(c).

“ The purpose of a summary judgment is to ‘ provide a method of summarily
terminat ing a case whe n i t clearly appears that only a question of law is involved
and that there is no genuine issue of fact. ’ ” G & H Towing Co. v. M agee , 347
S.W.3d 293 , 297 (Tex. 2011) (per curiam) (quoting Gaines v. Hamman , 358 S.W.2d 557, 563 ( Tex. 1962) )

. However, s umma ry judgm ent may only be granted upon grounds expressly asserted in the summary judgment motion. Id

. at 297 ; see also M cConnell v. Southside Indep. Sch. Dist. , 858 S.W.2d 337 , 341 (Tex. 1993 )

. Granting a summa ry judgment on a claim not addressed in the su mmary judgment
motion therefore generally constitutes reversible error. Magee , 347 S. W.3d at 297 ; Chessher v. Sw. Bell Tel. Co. , 658 S.W.2d 563, 564 (Tex. 1983) (per curiam).

Fraud Cl a im and Standing
We agree with Kay that the trial court erro neously gran ted summary judgmen t in favor of Evelyn a nd determin ed Kay lacked standing when Evelyn ’ s summary judgment motion failed to address Kay ’ s clai m that Evelyn “ fraudulently induced the Rule 11 Agreement and release ” of Kay ’ s half

- interest in Schulze, Jr. ’ s9

est ate. Kay asserted a fraud claim 1 in her P etition for Declaratory Judgment , stating
in relevan t part :

This action is brought pursuant to 3 5.005(3) of the Texas Civil Practice & Remedies Code, which provides: “[a] person interested . . . in the admi nistr ation of

. . . the estate of a decedent

. . . may have a declaration of legal relations in respect to the

. . . estate: (3) to determine any que stion arising in the administration of the

. . . estate [ .]” There is a real and justiciable controversy bet ween the Administrat [ r] ix of the Estate of Benton Schulze, Jr. and Applicant.

. . . the a ction s of Administratrix of the E state of Benton Schulze, Jr. in concealing the oil, gas and mineral leases, and mineral

an d /or royalty interests, constitute extrin sic f raud. Montgome ry v. Kennedy , 669 S.W .2d 309, 313 (Tex. 1984). Applicant relied upon t he di sclosures provided by Admini stratrix, since the values for the oil , gas and mineral leases, and the mineral and/or roy alty interests had never been valued sinc e the y were listed as “Unknown” on the 1992 Inventory. In discussions to settle the surface and personal property contained within the Estate of Benton Schulze, Jr., Administratrix stated that the mineral leases an d interests would be settled at a later d ate, once their value was known. Applicant relied upon this statement and Administratrix’s disclo sure that the values of the interests and leases were unknown. At the time the Rule 11 Settlement Agreement was sign ed, Administratrix breached her fiduciary duty because she had kn owledge of the values of the mineral, oil, and gas leases, and the m ineral and/or royalty interests

a nd /or when later learned of the same, but she failed to update the inventory and disclose the values of the leases and interests to Appl icant.

1 “ Like a broader common

- law fraud claim, a fraudulent

- inducement claim r equires proof that: (1) the defendant made a material misrepresentation; (2) the defe ndant knew at the time t hat the representation was f alse or lacked knowledge of its truth; (3 ) the defendant intended that the plaintiff should rely or act on the misrepr esentation; (4) the plaintiff relied on the misrepresentation; and (5) the plaintiff's reliance on the misrepr esentation caused injury

. ” Int ’ l Bus. Mach s

. Corp. v. Lufkin Indus., LLC
, 573 S.W.3d 224 , 228 (Tex. 2019)

.10 Thus, Applicant seeks an alternative declaratory judgment that the Rule 11 Agree ment is void on grounds of extrin sic fraud. Kennedy v. Hyde , 682 S.W.2d 525, 529 (Tex. 1984). A release is a contract and
, like any other contract , it is subject t o avo idance on grounds of fraudulent inducement

. Italian Cowboy Partners, Ltd. v. Prudenti al Ins. Co. of Am. , 341 S.W.3d 323 , 331 (Tex. 2011) ; Schlumberger Tech. Corp. v.
Swanson , 959 S.W.2d 171 , 178 (Tex. 1997)

. “ In other words, fraudulent
inducement is almo st always grounds to set aside a contract despite a merger clause, but in certain circ umstances, it may be possible for a contract ’ s terms to preclude a claim for fraudulent inducement by a clear and specific d isclaimer

- of

reliance clause

. ” Italian C owboy Partners, Ltd. , 341 S.W.3d at 331; Schlumberger Tech. Corp. , 959 S.W.2d at 181

. Acco rdingly, w hen an estate administra t or misre presents the value of an estate in order to induce a beneficiary to execute a
rel ease , the beneficiary has standing to ass ert a fraud claim as well as seek the
admini strator ’ s removal. See McAdams v. McAdams , No. 07

- 01

- 0343

- CV, 2002
WL 342639 , at *6

- 7 (Tex. App.

— Amarillo Mar. 1, 2002, no pet.)

. Kay has standing to assert a cla i m that she was fraudulently induced to sign
the Agree ment

. See id

. Here, the trial court seem ingly presumed t hat t he
A greement was valid and there was no fraud. A lthough Ka y pleaded a fraud claim, Evelyn never address ed and proved as a matter of law that there was no fraudulent inducement in this cas e. I nstead, Evelyn made one conclu sory
statemen t in her motion for su mmary judgment : “ It is abundantly clear tha t all parties had the same knowledge or means of obtaining the same knowledge and there was no fraud, misre presentation, concealment, or condu ct ot herwise inequitable on the part of Schulze when the Rule 11 Agree ment was executed or at any other time. ” Ev elyn failed to explain why there was “ no fraud,
misre presentation, concealment ” and did not point to any supporting evidence

.11

Because Evelyn ’ s sum mary judgment motion did not address Kay ’ s fraud claim, the trial court reversibly er red by dismis sing it. See Magee , 347 S.W.3d at 297

- 98

. T he trial court also reversibly erred in finding that Kay lacked sta nding
when it presum ed the underlying Agr eemen t was valid a nd not fraudulently
induced
, despite Evelyn ’ s fail ure to prove as a matter of law ther e was no fr aud.
See id

. Accordingly , we sustain Kay ’ s first issue ; therefore, we ne ed not address
her second issue

. C ONCLUSION Having sustained Kay ’ s firs t issue, we reverse the trial court ’ s Fina l Summary Judgment and remand this case to the trial court for further proceedings

.

/s/ Meag a n Ha ssan Justice

P anel co ns is ts of J ust ice s Jewell, Zimmerer, and Hass an

.