NOS.: 04-14-00824-CV

 04-15-00006-CV

 

 IN THE COURT OF APPEALS 

 FOR THE FOURTH DISTRICT OF TEXAS AT SAN ANTONIO 

ROBERT TYSON,

CARL AND KATHY TAYLOR,

LINDA AND RON TETRICK,

JIM AND NANCY WESCOTT, and

PAUL AND RUTHE NILSON,

 

 Appellants/Plaintiffs,

 -againstROBERT N. FREEMAN II, 

DEMAR BOREN

And LORENA YEATES, Husband and 

Wife,

 Appellees/Defendants.

 

 Appeal from the 198

th Judicial District Court 

 Bandera County, Texas 

 

 BRIEF FOR APPELLANTS 

CAROLE K. BOYD 

 Attorney for Plaintiffs/Appellants 

 15751 Highway 16 North 

 Medina, Texas 78055 

 (830) 589-7587 

 Fax: (830) 589-7598 

 E-mail: ckbesq@hctc.net

 SBN: 00786793 

 ORAL ARGUMENT REQUESTED 

ACCEPTED

04-14-00824-CV

FOURTH COURT OF APPEALS

SAN ANTONIO, TEXAS

2/24/2015 12:40:54 AM

KEITH HOTTLE

CLERK

 FILED IN 4th COURT OF APPEALS SAN ANTONIO, TEXAS 2/24/2015 12:40:54 AM KEITH E. HOTTLE Clerk
2

 IDENTITY OF PARTIES AND COUNSEL

Appellants/Plaintiffs

Robert Tyson

Carl and Kathy Taylor

Linda and Ron Tetrick

Jim and Nancy Wescott

Paul and Ruthe Nilson

Counsel for Appellants

Carole K. Boyd

 15751 Highway 16 North

Medina, Texas 78055

Appellees/Defendants

Robert N. Freeman, II

Demar Boren

Lorena Yeates

Counsel for Appellees

C. Dixon Mosty

Mosty Law Firm

222 Sidney Baker South, Suite 400

Kerrville, Texas 78028

Counsel for Robert N. Freeman, II

Stephen B. Schulte

Stephen B. Schulte, P.C.

Main Plaza One

820 Main Street, Suite 100

Kerrville, Texas 78028

Counsel for Demar Boren and Lorena Yeates
3

TABLE OF CONTENTS

Page

IDENTITY OF PARTIES AND COUNSEL ........................................ 2

TABLE OF CONTENTS ................................................................ 3

INDEX OF AUTHORITIES ............................................................. 4

STATEMENT OF THE CASE ......................................................... 5

STATEMENT REGARDING ORAL ARGUMENT ................................. 6

ISSUES PRESENTED .................................................................. 6

STATEMENT OF FACTS ............................................................. 7

SUMMARY OF THE ARGUMENT ................................................... 8

ARGUMENT ............................................................................. 9

I. The District Court Erred in Rejecting All of Appellants Summary

Judgment Evidence ......................................................... 9

II. The District Court Erred in Granting Summary Judgments to

Appellees Prior to Completion of Integral Discovery .................. 11

III. The District Court Erred in Denying Appellants’ Motion for 

Opportunity to Remedy and Rehearing .................................. 13

IV. The District Court Erred in Granting Appellees’ Motions 

For Severance ............................................................... 14

CONCLUSION AND PRAYER ........................................................ 15

APPENDIX (All documents contained in Clerk’s Record and Reporters’ Records)
4

INDEX OF AUTHORITIES

CASES:

Dubois v. Harris County

866 S.W. 2d 787, 791 (Tex.App.-Houston[14th Dist.], 1993 ........... 9

McConathy v. McConathy

869 S.W.2d, 341 (1994)...................................................... 10,13

Deerfield Land Joint Venture v. Southern Union Realty Co.

758 S.W.2d 608 (Tex.-App. – Dallas 1968, writ denied) ............... 10

Perry v. Houston Independent School District

902 S.W.2d 544 (Tex. App.-Houston, 1995) ............................. 10

Kingston v. Helm

82 S.W.3d 755 (Tex. App.-Corpus Christi 2002) ........................ 11

Leyendecker & Associates v. Wechter

683 S.W.2d 369, 375 (Tex. 1984) ......................................... 11 

McInnis v. Mallia

261 S.W. 3d 197, 200 (Tex. App.-Houston [14th Dist.] 2008 .......... 11

Madison v. Williamson

241 S.W. 3d 145, 155 (Tex.App.-Houston [1s Dist.] 2007, pet. denied 12

Garcia v. Martinez

988 S.W. 2d 219, 222 (Tex. 1999) .......................................... 12

. OAIC Commercial Assets, L.L.C. v. Stonegate Vil., L.P.

234 S.W.3d 726, 747 (Tex. App.- Dallas 2007, pet. filed) ............... 13

Lynette Miller v. Barry Keyser

90 S.W. 3d 712 (Tex. 2002) .................................................. 13

Castleberry v. Branscum et al.

721 S.W.2d 270 (Tex.1986) .................................................. 13

Morris v. Northrop Grumman Corp.

37 F.Supp.2d 556,580 (E.D.N.Y. 1999) .................................... 14

State Dep't of Highways & Pub. Transp. v. Cotner

845 S.W.2d 818, 819 (Tex. 1993) ........................................... 14

RULES:

Texas Rules of Civil Procedure, Rule 166(a)(i) ..................................... 11

Texas Rules of Civil Procedure, Rule 166(a)(f) ..................................... 13
5

TO THE HNORABLE FOURTH COURT OF APPEALS:

Statement of the Case

Nature of the case Plaintiffs were life-time lease holders in a senior citizen retirement 

Community originally called “Las Aves Retreat” and later, under 

new ownership, “El Viaje.” CR 38. The leases were issued to 

Plaintiffs by Demar Boren and Lorena Yeates, husband and wife 

managers at the premises, under the authority of Robert N. 

Freeman, II, attorney, manager and a prior owner of Medina 

Livestock Sales Company, LTD. CR 38, 39. The new owners, 

through Bankruptcy Court, had the leases declared unenforceable 

and, under Texas law, deemed to be tenancies at will. CR 40, 293-

316. The Plaintiffs were issued letters of termination of their 

leases and had to vacate the premises or face eviction. CR 42, 318. 

Suit below is for violation of the DTPA, Common Law Fraud, 

Statutory Fraud, Fraudulent Inducement, Negligent 

Misrepresentation, Negligence and Gross Negligence against 

individuals and the entity Medina Livestock Sales Company, LTD.

CR 36, Tab 10.

Trial Court 198th Judicial District Court, Bandera County

 Hon. Rex Emerson

Trial Court’s 

Disposition Plaintiffs’ summary judgment evidence was excluded (CR 328-

331, Tab 26), summary judgment granted to all individual 

Defendants (CR 448 (Tab 30; CR 449, Tab 31) and 
6

individuals Defendants’/Appellees’ motions for severance were 

granted. CR 490, Tab 40; CR 494,495. Plaintiffs’/Appellants 

motion for Remedy and Rehearing was denied. CR 491, Tab 41.

Statement Regarding Oral Argument

Because of the several rulings, individual defendants motions having been 

brought simultaneously but Orders being issued at different times, and the confusion that 

has surrounding the identification of Appellees in this matter, as well as other 

administrative issues which hopefully will be resolved shortly, it is felt for the Court to 

have these matters clarified and put into time sequence, and to craft an opinion that is 

consistent with the issues and facts, oral argument would be appropriate and helpful. The 

issues here are important ones, worthy of the Court’s full consideration. The District 

Court’s Orders denying summary judgment evidence, denying re-hearing and granting 

severance in a case where clearly the case law and Rules dictate otherwise is erroneous 

and should be corrected in the administration of justice. 

Issues Presented

1. Did the District Court err in rejecting Plaintiffs’ Summary Judgment evidence?

2. Did the District Court err in granting Summary Judgment to all individual 

Defendants before completion of discovery?

3. Did the District Court err in denying Plaintiffs’ Motion for Opportunity to 

Remedy and for Rehearing?

4. Did the District Court err in granting severance of individual Defendants?
7

Statement of Facts

Appellants’ First Amended Petition alleges that Appellants were life-time leasees 

of premises which they leased in a senior citizen community located in Medina, Texas, 

then known as Las Aves Retreat, paying on average a lump sum of $25,000 per lot. On 

the lot the Appellants were able to place a park model home, sheds, decks, or simply park 

a motor home there. Each lot had utilities and became a permanent residence for 

Appellants who were elderly veterans on social security incomes. Maintenance fees were 

fixed at $500/year which enabled Appellants to know what their retirement expenses 

would be to a great extent, for the remainder of their lives. CR 38-40, Tab 10.

Demar Boren and Lorena Yeates (hereinafter “Boren and Yeates”), husband and 

wife, were the initial management team for the premises, hired by and under the 

supervision and authority of Robert N. Freeman, II (hereinafter “Freeman”.) Boren and 

Yeates marketed the lots and sold to the Appellants the lifetime leases on behalf of 

Freeman and his company and at his direction, assuring Appellants that they were legal 

and binding. CR 39, 42 (Tab 10). Freeman was represented to Appellants as a real estate 

attorney from Laredo, and as owner of the premises. Appellants did not have legal 

representation when they signed the lease agreements, but felt assured of the legality of 

the documents since they knew Freeman to be a real estate attorney. Freeman visited the 

property from time to time and met with some of the Appellants. CR 43-48, Tab 10.

Eventually, in or about 2008, Robert Freeman effected a sale of the premises to an entity 

known as El Viaje Retreat, LLC, owned and operated by Susan Venus and Anne 

Blankenship, taking back a purchase money mortgage. CR 39-40, Tab 10. He then 
8

transferred title of the premises from Medina Livestock Sales, Company, LTD to Listo 

Corporation, another of his entities. 

In September 2012 the new owners filed for bankruptcy in order to try to avoid 

the leases of Appellants and others who held lifetime leases at El Viaje. In July 2013 

Judge Craig A. Gargotta held that the lifetime leases of Appellants and other residents of 

the retreat were not legal in Texas, but were deemed to be tenancies at will and could be 

rejected and terminated. CR 292-317, Tab 23. Shortly thereafter, the Appellants were 

given written notice that their leases were terminated. CR 318, Tab 23. Appellants lost 

their life’s savings as they could not get their investments back on their homes that they 

had established over the years and found themselves forced to move from the retreat, 

losing their investments and sustaining substantial damages. CR 42-48, Tab 10.

Appellants brought the instant litigation alleging violation of the Deceptive Trade 

Practices Act, and for Common Law Fraud, Statutory Fraud, Fraudulent Inducement, 

Negligent Misrepresentation, Negligence, and Gross Negligence. CR Tab 10

Summary of the Argument

Attorneys for individual Appellees both moved for summary judgment in District 

Court, and moved to have Appellants’ summary judgment evidence excluded. Argument 

was made by the attorney for Freeman, Dixon Mosty, that excerpts from deposition 

transcripts were not authenticated and thus could not be summary judgment evidence. He 

also objected to a Bankruptcy Court transcript and resultant Order, and an 

unauthenticated letter from the attorney for the Debtor in Bankruptcy (the subsequent 

owner of the premises then known as El Viaje Retreat, LLC) to residents at El Viaje 

Retreat, including Appellants. 
9

The Court, having heard argument from Mr. Mosty, having reviewed his 

submission which was handed to the court and counsel at the start of the hearing, and 

taking into account the case being cited by Mr. Mosty upon which his argument was 

based, rejected Appellants’ evidence and thus granted summary judgments to all 

individual plaintiffs. 

The case relied upon by Mr. Mosty was a 1993 Court of Appeals case. In January 

1994 the Texas Supreme Court, taking up the same issue, found authentication 

unnecessary. Appellants then moved for an opportunity to cure (the unauthenticated 

letter, a form defect) and re-hearing on having all evidence exclude. Appellants’ motion 

was wrongfully denied.

Individual defendants, at the same hearing, had moved for severance; their 

motions were wrongfully granted. 

Appellants underlying matter was thus eviscerated, as it was the individuals who 

have, pursuant to case law, the liability, and who also have the means to compensate 

Appellants for the resultant damages at the hands of these individuals. 

Argument

1. The District Court Erred in Rejecting all of Appellants’ Summary Judgment 

Evidence.

The District Court ruled that all of Appellants’ Summary Judgment Evidence should 

be rejected, presumably pursuant to Appellees’ argument. No explanation was offered by 

the Court. By doing so, Appellants had virtually no means of opposing the summary 

judgments. The argument of counsel for Freeman, C. Dixon Mosty, was based upon the 

case of Dubois v. Harris County, 866 S.W. 2d 787, 791 (Tex.App.-Houston[14th Dist.], 

1993.) which found unauthenticated excerpts from transcript to be inadmissible as 
10

evidence for summary judgment proofs. In January, only a month after that decision, the 

Supreme Court of Texas, in McConathy v. McConathy, 869 S.W.2d, 341 (1994) held 

otherwise, overturning the underlying case of Deerfield Land Joint Venture v. Southern 

Union Realty Co., 758 S.W.2d 608 (Tex.-App. – Dallas 1968, writ denied) relied upon by 

Dubois. Thus, Appellees cited bad law and the District Court, without comment or 

explanation, ruled against Appellants and dismissed all of their evidence. RR (Paula 

Beaver) 10. Counsel for Appellees also argued that Appellants could not use their own 

answers to discovery as summary judgment evidence. However, a non-movant may use a 

movant’s own exhibit against the movant to establish the existence of a fact question. 

Perry v. Houston Independent School District, 902 S.W.2d 544 (Tex. App.-Houston, 

1995). Appellants had argued that they believed the corporate entity and Freeman to be 

one and the same. Anything argued by counsel for Appellants after their Summary 

Judgment evidence was excluded, though, was not able to be considered (Rule 166a[i]). 

There were issues raised by Appellees’ counsel contesting individual liability and statute 

of limitations. These issues were heard by the Judge, but no response by 

Plaintiffs/Appellants’ counsel could be considered, and there were valid and important 

responses to be considered. Although counsel attempted to address the issue of statute of 

limitations, because the Appellants’ evidence was not considered, it remained to be 

proven that Plaintiffs/Appellants only knew of the illegality of their leases when the 

Bankruptcy Judge opined that they were not enforceable leases in Texas, but rather 

tenancies at will and that they could be terminated and were unenforceable. This came 

about well within the statute for Plaintiffs’ time frame to bring suit. Likewise, there was 

case law stating that individuals had liability whether they knew or not that what they 
11

were promoting was illegal. It is well established in Texas case law that a corporate

agent can be personally liable for tortious acts which he directs or participates in during

his employment. Kingston v. Helm, 82 S.W.3d 755 (Tex. App.-Corpus Christi 2002);

Leyendecker & Associates v. Wechter, 683 S.W.2d 369, 375 (Tex. 1984). This was not 

able to be introduced or considered as Plaintiffs/Appellants had no admissible evidence, 

and without such, Summary Judgments had to be granted against them. 

Defendants/Appellees motions, also, were defective in that they were not 

specifically address or labeled as No-Evidence Motions. Plaintiffs/Appellants therefore 

had no notice of what their burden of proof was on going into the hearing, and assumed 

that they were traditional motions for Summary Judgment. The Court, though, treated 

them as No-Evidence Motions. This was an additional factor in the devastating effect of 

excluding Plaintiffs/Appellants’ evidence.

2. The District Court Erred in Granting Summary Judgments to Appellees 

prior to Completion of Integral Discovery.

Appellants, both in their opposition papers and in open Court, stated that Summary 

Judgment was not ripe because the deposition of Freeman, a critical event to this matter, 

had not yet been taken. CR 289, 290; RR (Paula Beaver) 16-18. Appellants did not 

request a continuance because of reliance upon case law and Rules which denote when 

summary judgment is appropriate. Texas Rules of Civil Procedure, Rule 166(a)(i) allows 

for a summary judgment motion to be made after “adequate time for discovery.” 

According to the comment to Rule 166(a)(i), “a discovery period set by pretrial order 

should be adequate opportunity for discovery unless there is a showing to the contrary, 

and ordinarily a motion under paragraph (i) would be permitted after the period but not 

before.” McInnis v. Mallia, 261 S.W. 3d 197, 200 (Tex. App.-Houston [14th Dist.] 2008, 
12

no pet. The trial court’s determination that there has been adequate time for discovery is 

reviewed above for abuse of discretion. In the instant matter, there was no statement 

whatsoever from the District Court as to whether summary judgment was ripe because of 

adequate time for discovery having been had. A trial court abuses its discretion if it acts 

in an arbitrary or unreasonable manner ‘‘without reference to any guiding rules or 

principles.” Madison v. Williamson, 241 S.W. 3d 145, 155 (Tex.App.-Houston [1s Dist.] 

2007, pet. denied (quoting Garcia v. Martinez, 988 S.W. 2d 219, 222 (Tex. 1999). When 

Summary Judgment motions were made, Summary Judgment relief was not appropriate; 

the discovery period had not run, and the deposition of Freeman was of upmost 

importance to the determination of his liability and authority of his management. Until 

these issues were clarified, it was impossible to determine which individual 

defendants/Appellees might have liability, and to what extent. Additionally, when 

depositions of Boren and Yeates where sought by counsel for Appellants, a motion was 

made to quash. CR 81-90, Tag 19. Those depositions were sought prior to taking the 

deposition of Freeman for strategic purposes, and the refusal for compliance with agreed 

upon dates was based upon the statement by counsel that they would be a waste of time. 

All other written discovery had been taken. When Appellants finally set a date when no 

response came from Appellees as to a date, all individuals made a motion to quash. When 

the Court asked if Appellants had requested a continuance by motion, it was answered 

that, there was no formal request for a continuance in opposition papers, but it was 

stressed that discovery was not complete and Summary Judgment, therefore, was not ripe

as there were facts in dispute that required the deposition of Freeman. RR (Paula Beaver) 

16-28. In any event, no continuance was granted, and there was no factual determination 
13

or further discussion by the Court as to why Summary Judgment would be granted 

notwithstanding incomplete discovery.

3. The District Court Erred in Denying Appellants’ Motion for Opportunity to 

Remedy and Rehearing.

By having rejected Appellants’ Summary Judgment evidence in its entirety, the 

District Court had no evidence before it in opposition to the Summary Judgment motions 

brought by the individual defendants. However, the Court had an opportunity upon the 

return date of Appellants’ motion for Remedy and Rehearing to correct their mistake of 

law, and allow Appellants a rehearing on the Appellees’ motions. OAIC Commercial 

Assets, L.L.C. v. Stonegate Vil., L.P., 234 S.W.3d 726, 747 (Tex. App.- Dallas 2007, pet. 

filed) (“The sole purpose of a motion for rehearing is to provide the court an opportunity 

to correct any errors on issues already presented.”) At that time, Appellants made the 

court aware of case law evidencing the fact that Appellants’ Summary Judgment 

evidence was admissible (RR 4-5: McConathy v. McConathy, 869 S.W.2d 341 [Tex. 

1994]) , as well as case law whereby Appellants had viable claims against individual 

defendants for liability (RR 12: Lynette Miller v. Barry Keyser, 90 S.W. 3d 712 [Tex. 

2002]) See also Castleberry v. Branscum et al., 721 S.W.2d 270 (Tex.1986.). In other 

words, Appellants’ desire for a rehearing was not rhetorical in nature, but a valid 

assertion that the individual defendants must remain in the case in chief. The Court also

had the opportunity to allow Appellants to remedy any defects of form. TRCP 166(a)(f).

The District Court Judge stated in Court on the motion that he had reviewed the 

transcript of Lorena Yeats and that his holding still stood as previously Ordered. The 

Judge did not state that he reviewed any other of the evidence submitted by Appellants 

which was previously rejected, or give any rationale for his holding. 
14

The mistake of law upon which Appellants’ evidence was excluded not only 

denied Appellants the ability to defend the Summary Judgment motions, but highly 

prejudiced the outcome of their subsequent motion for rehearing and remedy. The 

District Court seemingly was not going to change its ruling no matter what evidence was 

then set forth before it by Appellants. This amounted to a continued abuse of discretion 

by the District Court in disregard of case law, Rules and procedure. Appellants should 

have been granted a rehearing as counsel for Freeman’s admission that there was 

subsequent case law which invalidated his own submission of case law was clearly the 

deciding element in the Court’s holdings on Summary Judgment and on that basis alone a 

rehearing should have been granted. 

4. The District Court Erred in Granting Appellees’ Motions for Severance.

Severance should only be granted if it will further the administration of justice. 

“Relevant considerations in determining whether to sever a party or claim may 

include 1) whether the claims arise out of the same transaction or occurrence; 2) 

whether the claims present common questions of law or fact; 3) whether judicial 

economy would be served; 4) whether prejudice could be avoided through severance; 

and 5) whether the separate claims require different witnesses and documentary 

proof.” Morris v. Northrop Grumman Corp., 37 F.Supp.2d 556,580 (E.D.N.Y. 1999). 

A claim may be properly severed only if: (1) the controversy involves more than one 

cause of action, (2) the severed claim is one that would be proper if independently 

asserted, and (3) the severed claim is not so interwoven with the remaining action that 

they involve the same facts and issues. State Dep't of Highways & Pub. Transp. v. 

Cotner, 845 S.W.2d 818, 819 (Tex. 1993). In this case the severance of the claims 
15

against the individual defendants were not only inextricably interwoven with the 

remaining action, but could not stand along, as all individuals were agents of the 

corporate entity. The severance was only to make the summary judgments in favor of 

the individuals instantly appealable and to divide the litigation into three separate 

actions. In doing so, as was well known to opposing counsel and the Court, it placed 

an insurmountable financial burden on Appellants. Appellees are fully aware that 

Appellants have lost their life’s savings over this situation and have a financial 

hardship which precludes such expenditures. Appellants are seeking justice on a 

virtual shoestring, and to have multiple cases to be appealed at once would be 

financially impossible for them. Appellants have alleged serious damages at the 

hands these individual defendants which, by law, are compensable. However, if the 

Court makes it untenable for them to proceed, then justice would go out the window, 

and that is not the intention of the Rules, the law, or this judicial system. There was 

no compelling reason for severance except to create a hardship for Appellants, 

severance was an abuse of discretion, and should not have been granted. 

Conclusion and Prayer

For these reasons, Appellants request that this Court reverse the District Court’s 

Orders granting Appellee’s motions for Summary Judgment and for Severance and 

specifically Deny Appellees Summary Judgment and Severance Motions. 

In the alternative, if the Court does not specifically Deny these motion, Appellants 

request that this Court reverse the District Court’s Order Denying Appellants’ Motion for 

Remedy and Rehearing, and allow Appellants an opportunity to amend their evidence 
16

and for a rehearing on the Summary Judgment motions. Appellants also request all other 

relief to which they may show themselves justly entitled.

February 24, 2015 Respectfully Submitted,

/S/Carole K. Boyd

State Bar Number: 00786793

15751 Highway 16 North

Medina, Texas 78055

(830) 589-7587

Fax: (830) 589-7598

ATTORNEY FOR APPELLANTS

CERTIFICATE OF SERVICE

I certify that on February 24, 2015 the within Brief for Appellants was served 

upon opposing counsel by e-filing and email as follows:

C. Dixon Mosty

Mosty Law Firm

Email: cdmosty@mostylaw.com

Stephen B. Schulte

Stephen B. Schulte PC

Email: sschulte@schultepc.com

/S/ Carole K. Boyd