Fourth Court of Appeals

San Antonio, Texas

OPINION

No. 04-13-00201-CV

BANK OF AMERICA, N.A. as Trustee of Bettye Baker Brown Trust, u/w, f/b/o William David 

Deiss, Trustee of Bettye Baker Brown Trust u/w, f/b/o Dianne Elizabeth Mysliwiec, Trustee of 

Bettye Baker Brown Trust, u/w, f/b/o Paula Jane Roberts, Trustee of Bettye Baker Brown Trust, 

and Baker E. Shaw, as Trustee of Dorothy Ann Roos Testamentary Trust,

Appellants

v.

PRIZE ENERGY RESOURCES, L.P., Prize Operating Company, Gruy Petroleum 

Management Company n/k/a Cimarex Energy Co. of Colorado, Magnum Hunter Resources, Inc., 

Cimarex Energy Co., Hunter Gas Gathering, Inc., Pat R. Rutherford Jr., Michael G. Rutherford, 

Stevan D. Rutherford, Patrick R. Rutherford, III, David Traylor Rutherford, John Richard 

Rutherford, Mary Elizabeth Rutherford, Paul Maroney Rutherford, Michael G. Rutherford, Jr., 

Sally Ann Rutherford, and Rutherford Oil Co.,

Appellees

From the 343rd Judicial District Court, McMullen County, Texas

Trial Court No. M05-0002-CV-C

Honorable Michael E. Welborn, Judge Presiding

Opinion by: Patricia O. Alvarez, Justice

Sitting: Marialyn Barnard, Justice

Rebeca C. Martinez, Justice

Patricia O. Alvarez, Justice

Delivered and Filed: August 29, 2014

REVERSED AND REMANDED 

This case stems from a dispute over the effects of the termination of an oil, gas, and mineral 

lease and a joint operating agreement (JOA). The lease in question, the Baker Lease, is located in 
04-13-00201-CV

McMullen County. The Baker Trusts, represented by Bank of America, and the Rutherfords1 are 

lessors of the Baker Lease. The Bank and the Rutherfords each own a 25% mineral interest subject 

to the Baker Lease. The remaining 50% mineral interest is equally split between the Rutherfords 

and the drilling company. The mineral interests contained within the Baker Lease are subject to 

the JOA in question. 

In August of 2001, after a seventy-one day period when the wells on the Baker Lease were 

not operating or producing in paying quantities, both the Baker Lease and the JOA terminated. 

The effect of the Baker Lease termination, and likewise the JOA termination, meant each party, 

specifically the Bank, was entitled to a one-fourth share of production, less costs, rather than only 

the one-eighth royalties provided for in the Baker Lease. Appellees moved for summary judgment 

asserting (1) the Bank ratified the Ratification thereby waiving its right to seek rescission of the 

Ratification; (2) the Bank was prevented by quasi-estoppel from seeking such rescission; and (3) 

the evidence conclusively established adverse possession of the Baker Lease. The trial court held 

there was no evidence to support the Bank’s claims and dismissed the Bank’s claims with 

prejudice. 

Because the summary judgment evidence raises genuine issues of material fact negating 

the trial court’s grant of summary judgment, we reverse the trial court’s order granting summary 

judgment and remand this matter to the trial court for further consideration consistent with this 

opinion.

1 Michael G. Rutherford and Patrick R. Rutherford, Jr., and their children, who are the heirs of P.R. Rutherford, and 

Rutherford Oil Corporation

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FACTUAL BACKGROUND

A. The Baker Lease

In 1986, the original drilling operator, Atlantic Richfield Company, entered into a purchase 

and sale agreement with Prize Energy. Under the terms of the agreement, upon any sixty-day 

cessation of production, the Baker Lease and the JOA automatically terminated and ownership of 

the mineral interests reverted back, in equal portions, to Bank of America, as Trustee, the 

Rutherfords, Burlington Resources, and Atlantic Richfield Company. 

The Baker Lease provided as follows:

If, at the expiration of the primary term, oil, gas, or other mineral is not being 

produced on said land, or on acreage pooled therewith, but Lessee is then engaged 

in drilling or reworking operations thereon or shall have completed a dry hole 

thereon within sixty (60) days prior to the end of the primary term, the lease shall 

remain in force so long as operations on said well or for drilling or reworking of 

any additional well[s] are prosecuted with no cessation of more than sixty (60) 

consecutive days, and if they result in production of oil[,] gas or other mineral, so 

long thereafter as oil, gas or other mineral is produced from said land or acreage 

pooled therewith.

(emphasis added). The JOA further provided as follows:

This agreement shall remain in full force and effect for as long as any of the oil and 

gas leases subjected to this agreement remain or are continued in force as to any 

part of the Unit Area, whether by production, extension, renewal or otherwise.

B. The Baker Lease and the JOA Expire and Hoskins Files Suit

Between June and August of 2001, there was a seventy-one day period when the wells on 

the Baker Lease were not operating or producing in paying quantities. None of the lessors was

aware of the cessation of operations, and no one raised any concern at the time. The production 

resumed, and the drilling operator continued developing the property and completed additional 

producing wells. 

In 2004, Cliff Hoskins conducted research regarding the Baker Wells and discovered the 

possible termination of the Baker Lease and the JOA in August of 2001. The effect of the Baker 

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Lease termination, and likewise the JOA termination, meant the Lessors were entitled to a onefourth share of production, less costs, rather than only the one-eighth royalties provided for in the 

Baker Lease. Hoskins approached BP American Production Company, the successor to the 

Atlantic Richfield Company’s mineral interests.2 Hoskins reported that, based on his assessment,

the lease and the JOA terminated due to cessation of operations. Hoskins and BP then executed a 

conditional lease option agreement regarding BP’s 25% mineral interest. Hoskins sent a demand 

letter to the parties and on January 25, 2005, Hoskins filed suit to quiet title.

C. The Bank Signs the Ratification

On the same day that Hoskins filed suit, Prize and the Rutherfords (jointly Appellees) 

approached the Bank and requested the Bank sign a Ratification to the Baker Lease. When 

questioned, the Rutherfords assured the Bank there was no cessation of production and that the 

Baker Lease had not expired. The Rutherfords further claimed Hoskins’s demand letter and suit 

were frivolous and an attempt to extort money. Moreover, the Rutherfords explained “the mere 

existence of the allegations set forth in the Demand Letter would expose [the Leased Property] to 

substantial drainage by offset operators.” To avoid suspension of the drilling activities, the 

operators were requesting the Bank sign the Ratification as soon as possible. After meeting with 

the Bank, the Rutherfords provided the Bank with a copy of Hoskins’s demand letter and data 

attempting to convince the Bank that the Baker Lease did not expire. The Bank signed the 

following Ratification on February 14, 2005:

NOW, THEREFORE, for good and valuable considerations received by 

each of the Baker Trusts and the Rutherfords, the receipt and sufficiency of which 

2 In 1994, by assignment effective October 1, 1993, Atlantic Richfield Company assigned to Vastar Resources, Inc. 

the 25% mineral interest and associated royalty right. BP American Production Company succeeded through a series 

of mergers and name changes to the 25% mineral interest of Vastar Resources, Inc., and the associated royalty right. 

On or about January 15, 2007, by Mineral Deed with an effective date of August 16, 2004, BP conveyed its 25% 

mineral interest to Cliff Hoskins, Inc., reserving only a perpetual 1/16th nonparticipating royalty interest.

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are hereby acknowledged, and in consideration of Lessees’ undertakings under the 

Lease, the Baker Trusts and the Rutherfords hereby stipulate and agree as follows:

1. Each of the Baker Trusts and each of the Rutherfords (collectively, 

the “Mineral Owners”) hereby stipulates and agrees that (a) the Lease is 

currently in full force and effect and (b) the term of the Lease has been 

continuously perpetuated since April 23, 1971, by either (i) the production 

of oil and/or gas in paying quantities or (ii) operations, or both.

2. Without limiting the foregoing, (a) each of the Baker Trusts hereby 

(i) ratifies and adopts the Lease insofar as it covers or applies to the Leased 

Premises and (ii) grants and leases the Leased Premises to the Lessees upon 

the terms and provisions set forth in the Lease, and (b) each of the 

Rutherfords hereby (i) ratifies and adopts the Lease insofar as it covers or 

applies to Survey 3 and (ii) grants and leases Survey 3 to the Lessees upon 

the terms and provisions set forth in the Lease.

3. Each of the Mineral Owners hereby waives and releases any and all 

claims that the Lease terminated prior to the date of execution of this 

instrument for any reason whatsoever.

After the Bank signed the Ratification, Hoskins amended his petition and named the Bank 

as a defendant. After discovering the Baker Lease terminated and the Rutherfords’ attempts to 

preclude the Bank’s discovery of such, the Bank filed suit against Appellees, including affirmative 

claims for removal of a cloud on title and for declaratory relief, fraud, fraudulent inducement, 

conversion, unjust enrichment, violation of Texas Natural Resource Conservation Commission

rules, statutory fraud, rescission of its Ratification, and a claim to quiet title to the Baker Trusts’ 

mineral interest.

C. Prize Energy Resources, L.P. v. Cliff Hoskins, Inc. (Prize I)

The parties were previously before this court in Prize Energy Resources, L.P. v. Cliff 

Hoskins, Inc. (Prize I), 345 S.W.3d 537 (Tex. App.—San Antonio 2011, no pet.). 

On February 5, 2009, the trial court entered partial summary judgment, providing, in 

pertinent part, as follows:

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(1) Granted the summary judgment motion by Appellees on all claims by the 

Bank, “including claims of fraud and rescission of the Ratification,” and 

ordered that the Bank take nothing; and 

(2) Granted the declaratory relief that the Baker Lease and the JOA terminated 

in August 2001.

On February 23, 2011, this court issued Prize I, holding as follows:

(1) the Baker Lease terminated in August of 2001 due to cessation of

production for more than sixty consecutive days; 

(2) the Bank was not aware the Baker Lease expired;

(3) the evidence raised a fact issue as to whether Appellees made false 

statements of fact to the Bank;

(4) the evidence raised a fact issue regarding the Bank’s reliance on Appellees’ 

misrepresentations;

(5) the Bank would not have signed the Ratification as a whole but for the 

material misrepresentations made by Appellees and justifiably relied upon 

by the Bank; and 

(6) “the mere fact that the Ratification contains renewal or revivor language 

does not establish as a matter of law that the Bank was not induced to 

execute the Ratification by [Appellees’] misrepresentations that the Baker 

Lease had not expired.”

Id. at 577–87. Prize I reversed the trial court’s grant of summary judgment on all the Bank’s 

claims and remanded the matter to the trial court for further proceedings on the Bank’s claims. Id. 

at 588. We note, however, Prize I also acknowledged that whether the Bank “ratif[ied] the 

agreement and waiv[ed] any right to assert fraud as a ground to avoid or rescind the Ratification” 

was not raised by the summary judgment and not addressed in its opinion. Id. at 586–87.

D. Bank of America v. Prize Energy Resources, L.P.

On July 31, 2012, Appellees filed a subsequent traditional motion for summary judgment 

asserting (1) the Bank ratified the Ratification thereby waiving its right to seek rescission of the 

Ratification, (2) the Bank was prevented by quasi-estoppel from seeking such rescission, and (3) 

the evidence conclusively established adverse possession of the Baker Lease. Appellees also filed 

a no-evidence motion for summary judgment. The trial court held there was no evidence to support 

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the Bank’s claims. On January 16, 2013, the trial court granted Appellees’ motions for summary 

judgment and dismissed the Bank’s claims with prejudice. 

On appeal, the Bank argues the trial court erred in granting summary judgment because the 

evidence does not conclusively establish every element of the affirmative defenses of ratification, 

waiver, quasi-estoppel, and adverse possession. The Bank also argues there are genuine issues of 

material fact sufficient to rebut both the traditional and no-evidence summary judgment motions. 

STANDARD OF REVIEW

An appellate court reviews a traditional summary judgment de novo. Valence Operating 

Co. v. Dorsett, 164 S.W.3d 656, 661 (Tex. 2005); Roehrs v. FSI Holdings, Inc., 246 S.W.3d 796, 

805 (Tex. App.—Dallas 2008, pet. denied). To obtain summary judgment, the movant must 

establish there are no issues of material fact and that it is entitled to judgment as a matter of law. 

TEX.R.CIV. P. 166a(c); Diversicare Gen. Partner, Inc. v. Rubio, 185 S.W.3d 842, 846 (Tex. 2005); 

Nixon v. Mr. Prop. Mgmt., 690 S.W.2d 546, 548 (Tex. 1985). “An appellate court reviewing a 

summary judgment must consider all the evidence in the light most favorable to the nonmovant, 

indulging every reasonable inference in favor of the nonmovant and resolving any doubts against 

the motion.” Goodyear Tire & Rubber Co. v. Mayes, 236 S.W.3d 754, 756 (Tex. 2007) (per 

curiam); accord W. Invs., Inc. v. Urena, 162 S.W.3d 547, 550 (Tex. 2005); Nixon, 690 S.W.2d at 

548–49. When reviewing a summary judgment, we “must consider whether reasonable and fairminded jurors could differ in their conclusions in light of all the evidence presented.” Goodyear 

Tire, 236 S.W.3d at 755.

In reviewing the granting of a no-evidence summary judgment, we apply the same legal 

sufficiency standard as we apply in reviewing a directed verdict. King Ranch, Inc. v. Chapman, 

118 S.W.3d 742, 750–51 (Tex. 2003). The nonmovant in a no-evidence motion for summary 

judgment has the burden to raise a genuine issue of material fact by producing more than a scintilla 

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of probative evidence. See id. at 751; Moore v. K Mart Corp., 981 S.W.2d 266, 269 (Tex. App.—

San Antonio 1998, pet. denied). “[T]he evidence must be viewed in the light most favorable to 

the non-movant.” Ford Motor Co. v. Ridgway, 135 S.W.3d 598, 601 (Tex. 2004); Moore, 981 

S.W.2d at 269. 

RESCISSION OF THE RATIFICATION

By granting Appellees’ traditional motion for summary judgment, the trial court 

determined that, as a matter of law, the Bank ratified the Ratification and waived its right to seek

rescission of the Ratification. We first set out the law regarding waiver and ratification and then 

review the summary judgment evidence supporting each.

A. Waiver and Ratification

1. Waiver

“Waiver is defined as ‘an intentional relinquishment of a known right or intentional 

conduct inconsistent with claiming that right.’” Jernigan v. Langley, 111 S.W.3d 153, 156 (Tex. 

2003) (per curiam) (quoting Sun Exploration & Prod. Co. v. Benton, 728 S.W.2d 35, 37 (Tex. 

1987)); accord Geis v. Colina Del Rio, LP, 362 S.W.3d 100, 111 (Tex. App.—San Antonio 2011, 

pet. denied) (same). The party asserting waiver bears the burden to establish each element of its

affirmative defense. Geis, 362 S.W.3d at 111; see also TEX. R. CIV. P. 94. “Waiver is largely a 

matter of intent, and for implied waiver to be found through a party’s actions, intent must be clearly 

demonstrated by the surrounding facts and circumstances.” Jernigan, 111 S.W.3d at 156; accord 

Geis, 362 S.W.3d at 111. Appellate courts look to the “acts, words, or conduct of a party to 

determine if it unequivocally manifested an intention to no longer assert the right in question.” 

Geis, 362 S.W.3d at 111 (internal quotation marks omitted).

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2. Ratifying Acts

“Ratification occurs when a person who knows all the material facts confirms or adopts a 

prior act that did not then legally bind him and which he could have repudiated.” K.B. v. N.B., 811 

S.W.2d 634, 638 (Tex. App.—San Antonio 1991, writ denied); accord Bob Montgomery 

Chevrolet, Inc. v. Dent Zone Cos., 409 S.W.3d 181, 195 (Tex. App.—Dallas 2013, no pet.); 

Thompson Oil Royalty, LLC v. Graham, 351 S.W.3d 162, 165 (Tex. App.—Tyler 2011, no pet.). 

Proof of ratification requires evidence establishing “(1) approval by act, word, or conduct, (2) with 

full knowledge of the facts of the earlier act, and (3) with the intention of giving validity to the 

earlier act.” K.B., 811 S.W.2d at 638; accord Samms v. Autumn Run Cmty. Improvement Ass’n, 

Inc., 23 S.W.3d 398, 403 (Tex. App.—Houston [1st Dist.] 2000, pet. denied). 

Importantly, however, if the ratifier knows of the fraud and then chooses to perform under 

the contract, even “a contract procured by fraud can be ratified.” Thompson Oil, 351 S.W.3d at 

165. “When a party ratifies an agreement that has been induced by fraud, the ratification generally

vitiates the fraud.” Chambers v. Equity Bank, SSB, 319 S.W.3d 892, 902 (Tex. App.—Texarkana 

2010, no pet.); Cordero v. Tenet Healthcare Corp., 226 S.W.3d 747, 751–52 (Tex. App.—Dallas 

2007, pet. denied); but see Fortune Prod. Co. v. Conoco, Inc., 52 S.W.3d 671, 678 (Tex. 2000). 

Any act taken by a party that is “inconsistent with an intention to avoid the agreement” effectively 

waives the party’s right of rescission. Cordero, 226 S.W.3d at 750. “Once a party ratifies an 

agreement, that party may not later withdraw the ratification and seek to avoid the agreement.” Id.

(citing Harris v. Archer, 134 S.W.3d 411, 427 (Tex. App.—Amarillo 2004, pet. denied)); accord

Thompson Oil, 351 S.W.3d at 166.

The burden rests on the party asserting “ratification [to] prove that the ratifying party acted 

upon full knowledge of all material facts.” K.B., 811 S.W.2d at 638; accord Thompson Oil, 351 

S.W.3d at 165–66. To be entitled to traditional summary judgment, Appellees were, therefore,

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required to conclusively prove the Bank possessed knowledge of all the material facts and 

manifested clear intent to waive fraud. Fortune Prod. Co., 52 S.W.3d at 677; see also K.B., 811 

S.W.2d at 638; Thompson Oil, 351 S.W.3d at 165–66. To avoid no-evidence summary judgment, 

the Bank only had to raise a genuine issue of material fact. King Ranch, Inc., 118 S.W.3d at 751

B. Arguments of Parties

1. Appellees’ Arguments

Appellees assert that regardless of whether the Bank was fraudulently induced into signing 

the Ratification, the Bank cannot now seek to avoid it. PSB, Inc. v. LIT Indus. Tex. Ltd. P’ship, 

216 S.W.3d 429, 433 (Tex. App.—Dallas 2006, no pet.). Appellees point to the language within 

the Ratification itself as proof the Bank waived its claims. Appellees contend that, even assuming 

the Bank was fraudulently induced, such fraud does not vitiate the Bank’s ratification of the 

contract and the ensuing effect of being barred from seeking rescission or damages. Fortune Prod., 

52 S.W.3d at 678. Appellees challenge the Bank’s assertion that it lacked full knowledge until 

“just prior to filing suit.” They argue the Bank knew of the alleged fraud eighteen months prior to 

filing suit, accepted $106,000 in consideration for signing the Ratification, and, for over five years, 

continued to accept benefits in royalties and signed two division orders, and separately, the Bank 

accepted over $500,000 in royalty payments.

2. The Bank’s Arguments

The Bank counters the issues raised by Appellees were resolved in Prize I when this court 

concluded there were genuine issues of material fact concerning whether the Ratification was 

induced by fraud. In discussing information provided by Prize and the Rutherfords, and the Bank’s 

reliance thereon, the Prize I Court concluded “[t]he summary judgment record raises [material] 

fact issue[s when] the time the Bank signed the Ratification.” Prize I, 345 S.W.3d at 583. The 

Bank argues the Appellees misrepresented the status of the Baker Lease and the current summary 

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judgment evidence does not provide any new material facts regarding the same. The Bank further 

contends Appellees failed to present any proof of the Bank’s intent to waive its claim. See Fortune 

Prod., 52 S.W.3d at 677 (quoting Kennedy v. Bender, 104 Tex. 149, 135 S.W. 524, 525 (Tex.

1911)) (“‘Acts which, although in affirmance of the contract do not indicate any intention to waive 

the fraud, cannot be held to operate as a waiver.’”). 

On April 12, 2006, the Bank signed division orders for two of the Baker Wells. The Bank 

argues each division order expressly states it “does not constitute ratification of any oil and/or gas 

lease . . . and does not amend or alter the lease or any amendment thereto”; and, by their very 

language, the division orders raise questions of fact and cannot ratify the Ratification. 

Additionally, the division orders were revoked, as a matter of law, when the Bank served the 

petition in August 2006 asserting an interest different than that expressed in the April 2006 division 

orders.

C. Evidence Supporting Knowledge of Actual Fraud

Our review is limited to whether the evidence of material misrepresentations raised a 

question of fact regarding the Bank’s knowledge of actual fraud.

1. The Bank’s Evidence of Material Misrepresentations Supporting Lack of Knowledge

In support of its argument that it did not possess knowledge of the actual fraud, the Bank 

set forth the Rutherfords’ attempts to mislead the Bank regarding the termination of the Baker 

Lease. On January 6, 2005, Mike Rutherford approached the Bank and assured the Bank that the 

Baker Lease did not terminate. The Bank contends that, but for being misled by Appellees, the 

Bank would not have signed the Ratification. In support of its claims, the Bank presented the 

following evidence:

(1) Rutherford’s assurances that Hoskins’ threatened lawsuit was frivolous, an 

attempt to extort money, and that even the threat of such suit would cause 

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them to stop development of the property and leave the property at risk of 

drainage;

(2) Rutherford’s letter attaching the production data (including P-2’s and gauge 

reports for Baker No. 6 well) and his explanation of why the Baker Lease 

did not terminate;

(3) Rutherford’s claims the production information was provided by Prize;

(4) Rutherford’s assertion that in order to avoid suspension of drilling activities 

operators requested the Bank promptly sign the attached Stipulation and 

Ratification; 

(5) Data indicating the Baker Well No. 4 had been shut-in for a swabbing 

operation in April of 2001, which was not successful and was shut-in for 

further evaluation; 

(6) Data indicating the Baker Well No. 6 production volumes were not fully 

registered by gas metering equipment during relevant time period and Prize 

confirmed that “sales figures” (reported on P-2s are HPL’s meter figures) 

and “lease use figures” (estimates of quantifies of gas consumed on the lease 

for the operation of equipment and/or quantities lost to venting); and

(7) Gauge Sheets explaining that although Baker Well No. 6 well was “shut in 

for buildup” for most of June, July, and the first half of August, the well 

actually produced for a three-day period (6/15–6/17) and, therefore, there 

was no cessation for a sixty-day period.

2. Appellees’ Evidence Supporting Knowledge

As evidence of the Bank’s knowledge supporting the Ratification, Appellees look to the 

Bank’s acceptance of royalty payments and its execution of division orders after it had full 

knowledge of Appellees’ fraudulent behavior. More importantly, however, Appellees look to the 

direct evidence the Bank possessed prior to signing the Ratification.

(1) Hoskins’s January 3, 2005 letter regarding anti-spoliation and alleging 

Appellees had hidden facts from the Bank; 

(2) Hoskins’s January 7, 2005 demand letter detailing his claims that the Baker 

Lease had expired; 

(3) A memorandum regarding production data;

(4) Prize’s original and amended and corrected P-2 forms;

(5) Prize’s gauge and production reports;

(6) On February 14, 2005, in exchange for $106,637.50, the Bank signed the 

Ratification providing the Baker Lease was in full force and effect, the 

property was leased based on the terms contained in the Baker Lease, and 

waiving any claim the Baker Lease terminated;

(7) Hoskins’s pleadings alleging Appellees fraudulently concealed termination 

of the Baker Lease (Hoskins filed four different amended petitions after the 

Bank signed the Ratification);

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(8) In his Second Amended Petition, filed on April 1, 2005, Hoskins named the 

Bank as a defendant and specifically alleged the Baker Lease had terminated

in 2001;

(9) In June of 2005, Hoskins’s attorney sent correspondence to the Bank 

asserting Appellees “hid facts” from the Bank;

(10) In July of 2005, the Bank attended the deposition of Neil Etheridge, a 

production foreman at Prize wherein Etheridge testified there was no 

contemporaneous record of gas flaring in June of 2001;

(11) In December of 2005, the Bank conducted its own internal investigation 

regarding the validity of the Ratification;

(12) In May and June of 2006, the Bank attended meetings with Hoskins’s 

attorney outlining all of his claims regarding the Baker Lease; and

(13) Even after filing suit, the Bank continued to accept royalty payments 

totaling over $500,000.00.

Appellees argue the Bank’s subjective belief regarding the credibility or effect of those facts cannot 

defeat ratification.

3. Analysis

In Prize I, this court concluded that, prior to signing the Ratification, the Bank was not 

aware the Baker Lease had expired in August of 2001. Prize I, 345 S.W.3d at 577. This court 

further concluded the summary judgment evidence raised questions of fact regarding Appellees’ 

false representations and the Bank’s reliance on Appellees’ misrepresentations in signing the 

Ratification. Id. at 584–85. Although Appellees now point to information supporting the Bank’s 

knowledge of the alleged fraud and its decision to continue accepting the benefits, the evidence 

raises the same questions of fact reviewed by this court in Prize I. 

Appellees’ summary judgment evidence does not change this court’s previous conclusion 

regarding Appellees’ misrepresentations. Id. at 584–85. “[T]here is summary judgment evidence 

raising a fact issue that [Appellees] concealed that the Lease had terminated, both for cessation of 

production and for failure to produce in paying quantities.” Id. at 585. For the same reasons, we 

now conclude the summary judgment evidence raises genuine issues of material fact regarding the 

Bank’s actual knowledge of the fraud.

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Appellees contend that even if the Bank was fraudulently induced into signing the 

Ratification, the Bank’s actions ratified the contract and barred the Bank’s claims for rescission 

and damages. See Fortune Prod., 52 S.W.3d at 677–78. We, therefore, turn to the Bank’s actions 

after it signed the Ratification.

D. Waiver Based on the Bank’s Actions After Signing the Ratification

The Texas Supreme Court’s analysis in Fortune Production Co. v. Conoco, Inc., 52 S.W.3d 

at 680, is instructive.3

 Fortune Production involved, predominantly, three plaintiffs—Fortune, 

Tucker, and Hankamer, all natural gas producers. Id. at 673. Conoco told the plaintiffs that it 

would not resell their residue gas at a lucrative contract price of $3.50 per Mcf. Id. at 674. The 

plaintiffs were led to believe their residue gas “would and could only be sold” on the spot market, 

at a substantially lower price. Id. Relying on Conoco’s representations, the plaintiffs signed twoyear contracts with Conoco, effective from 1990 to 1992, in which they agreed to accept a price 

based on spot market prices for residue gas. Id. Although Hankamer declined Conoco’s offers, 

he continued to deliver gas to Conoco and to accept payment for residue gas based on spot market 

prices. Id. at 674. At some point in time, the plaintiffs learned that most of their residue gas had 

been resold by Conoco to Lone Star and that Conoco had received $3.50 Mcf for that gas. Id. at 

675. “Precisely when plaintiffs learned these facts was disputed at trial.” Id. 

The Supreme Court looked at several criteria in addressing the question of intent as to the 

plaintiffs’ attempt to avoid the contract. Initially, the court analyzed the claims based on whether 

3 Appellees rely on Spellman v. Am. Universal Inv. Co., 687 S.W.2d 27, 29 (Tex. App.—Corpus Christi 

1984, writ ref’d n.r.e.), criticized by Fortune Prod., 52 S.W.3d at 678, for the proposition that a contract 

can be ratified even in the face of a party urging the ratification continuing to “deny wrongdoing.” 

Spellman, however, was expressly disapproved of in Fortune Production. 52 S.W.3d at 678.

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each plaintiff had a continuing obligation to perform and whether each plaintiff was bound by 

contract. Id. 

1. Continuing Obligation to Perform

A party who does not have a continuing obligation to perform under a contract, but who 

nevertheless continues to perform after learning of a fraud, ratifies the fraud. Id. at 679. Because 

the party had no obligation to perform, knew of the fraud, and continued to perform, the party is 

precluded from recovering damages for performance after it knew of the fraud. Id.; see also Meyer 

v. Cathey, 167 S.W.3d 327, 331–32 (Tex. 2005) (concluding that because Cathey was aware of 

the alleged fraud, but continued to work with Meyer despite being under no obligation to do so, 

Cathey ratified any fraud arising from misrepresentations made in the earlier agreement). Yet, 

“[n]ot every ratification of a contract induced by fraud will waive the right to sue for damages, as 

distinguished from the right to rescind.” Fortune Prod., 52 S.W.3d at 678. 

[A]cts done in affirmance of the contract can amount to a waiver of the fraud only

where they are done with full knowledge of the fraud and of all material facts, and 

with the intention, clearly manifested, of abiding by the contract and waiving all 

right to recover for the deception. Acts which, although in affirmance of the 

contract, do not indicate any intention to waive the fraud, cannot be held to operate 

as a waiver. 

Id. at 677 (quoting Kennedy, 135 S.W. at 525) (internal quotation marks omitted).

2. Existence of Contract Binding a Party 

The court next looked to whether a contract bound the plaintiff to continue performance. 

Id. at 679. Although Fortune and Tucker continued to deliver their gas to Conoco and accept 

payment after they learned of the fraud, their continued performance did not foreclose their right 

to sue for damages. Id. at 679–80. However, because Hankamer did not have a written agreement 

with Conoco after his contract expired, Hankamer was under no obligation to sell and Conoco was 

not required to purchase. “When [Hankamer’s company] delivered its gas after they knew of 

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Conoco’s fraud, with no obligation to continue deliveries, they were no longer relying on 

misrepresentations.” Id. at 679. “By delivering gas when they had no continuing obligation to do 

so after they learned that Conoco had made misrepresentations, [Hankamer’s company] entered 

into a new series of agreements with full knowledge of all material facts and of the prices that they 

were accepting.” Id. at 680. 

3. Present Contract was Binding on the Bank

The Bank contends, unlike Hankamer, it was bound by the division orders because it 

accepted the royalty payments based on the unit percentages under the division orders, and it had 

not revoked the division orders. Id. at 679. As such, even if the Bank continued to accept payments 

after it discovered the fraud, such acceptance does not foreclose their right to sue for damages. Id.

at 679–80. We agree.

Like Fortune and Tucker, after discovering the fraud, the Bank could have refused to 

perform under the fraudulently-induced contracts. Id. at 680. Yet, based on its obligation under 

the division orders, we cannot conclude Appellees conclusively proved the Bank’s conduct 

evidenced an intention to waive the fraud or to ratify the Ratification. Id. Accordingly, under 

Fortune Production, the Bank’s decision to continue performance did not operate, as a matter of 

law, as a waiver or “result in a loss of the right to sue for damages.” Id. at 679. 

E. Analysis

The summary judgment evidence raises genuine issues of material fact as to the extent and 

timing of the Bank’s actual knowledge of the fraud. See K.B., 811 S.W.2d at 638; see also

Thompson Oil, 351 S.W.3d at 165–66. Appellees’ arguments only highlight the facts in question—

including the documents and agreements signed, as well as the misrepresentations made by 

Appellees. Summary judgment is not proper based on the Bank having knowledge of some facts. 

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Summary judgment would be proper only if Appellees conclusively proved the Bank possessed 

actual knowledge of all the material facts. Id. at 166. 

Appellees’ summary judgment evidence also fails to prove the Bank acted with the 

requisite intent to waive the fraud. Fortune Prod., 52 S.W.3d at 677–78 (concluding question of 

ratification waiving fraud is not a black and white issue); see also Jernigan, 111 S.W.3d at 156 

(reiterating waiver includes element of intent). Based on the “surrounding facts and 

circumstances,” the summary judgment evidence is insufficient to support the trial court’s 

determination that Appellees conclusively proved the Bank acted with the requisite intent to waive 

its claim of fraud. Jernigan, 111 S.W.3d at 156. Although there is no question the Bank accepted 

royalties and monies for several years, ratification is an affirmative defense and a party asserting 

the defense must prove each element. K.B., 811 S.W.2d at 638. Appellees’ summary judgment 

evidence does not prove, as a matter of law, the Bank intended to ratify any new agreement. 

Considering all the evidence in the light most favorable to the Bank, Goodyear Tire, 236 

S.W.3d at 756, we conclude Appellees failed to establish that, as a matter of law, the Bank 

possessed “full knowledge of the fraud and all of the material facts’” Fortune Prod., 52 S.W.3d at 

677 (quoting Kennedy, 135 S.W.at 525), and that the Bank intended to waive any such fraud. TEX.

R. CIV. P. 166a(c); Nixon, 690 S.W.2d at 548. Accordingly, the trial court’s grant of summary 

judgment on these issues was in error.4

We next turn to the trial court’s determination that the doctrine of quasi-estoppel prevented 

the Bank from seeking rescission.

4 Appellees argue entitlement to summary judgment on the Bank’s claims for exemplary damages, corporate veil 

piercing, and attorneys’ fees. Because we conclude material questions of fact precluded the grant of summary 

judgment, we need not address these issues. See TEX. R. APP. P. 47.1.

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04-13-00201-CV

QUASI-ESTOPPEL AFFIRMATIVE DEFENSE

Appellees contend the Bank is estopped from asserting the Baker Lease terminated in 

August 2001 and that its mineral estate automatically reverted at that time. Appellees argue that 

because the Bank’s actions, after it had full knowledge of the material facts, were inconsistent with 

seeking to rescind the Ratification, it would be unconscionable to allow the Bank to now rescind. 

1. Affirmative Defense of Quasi-Estoppel

Quasi-estoppel is an affirmative defense that “precludes a party from asserting, to another’s 

disadvantage, a right inconsistent with a position previously taken.” Lopez v. Muñoz, Hockema & 

Reed, L.L.P., 22 S.W.3d 857, 864 (Tex. 2000). Although similar to equitable estoppel, quasiestoppel does not require “proof of a false statement or detrimental reliance.” Cambridge Prod., 

Inc. v. Geodyne Nominee Corp., 292 S.W.3d 725, 732 (Tex. App.—Amarillo 2009, pet. denied); 

accord Fasken Land & Minerals, Ltd. v. Occidental Permian, Ltd., 225 S.W.3d 577, 593 (Tex. 

App.—El Paso 2005, pet. denied). 

Quasi-estoppel “applies when it would be unconscionable to allow a person to maintain a 

position inconsistent with one to which he acquiesced, or from which he accepted a benefit.” 

Lopez, 22 S.W.3d at 864; see also Forney 921 Lot Dev. Partners I, L.P. v. Paul Taylor Homes, 

Ltd., 349 S.W.3d 258, 268 (Tex. App.—Dallas 2011, pet. denied); Hamilton v. Morris Res., Ltd., 

225 S.W.3d 336, 346 (Tex. App.—San Antonio 2007, pet. denied); Atkinson Gas Co. v. Albrecht, 

878 S.W.2d 236, 240 (Tex. App.—Corpus Christi 1994, writ denied) (“[Q]uasi estoppel forbids a 

party from accepting the benefits of a transaction . . . and then subsequently taking an inconsistent 

position to avoid corresponding obligations or effects.”). To prevail on a claim for quasi-estoppel, 

Appellees must prove (1) the Bank acquiesced to or benefited from a position inconsistent with its 

present position, (2) it would be unconscionable to allow the Bank to assert rescission, and (3) the 

Bank had knowledge of all material facts at the time of the conduct on which estoppel is based. 

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Lopez, 22 S.W.3d at 864; accord In re Willa Peters Hubberd Testamentary Trust, 432 S.W.3d 358, 

368 (Tex. App.—San Antonio 2014, no pet.). 

As an equitable theory, estoppel is subject to traditional equitable defenses. Tex. Enters., 

Inc. v. Arnold Oil Co., 59 S.W.3d 244, 249 (Tex. App.—San Antonio 2001, no pet.). The defensive 

doctrine of “clean hands” requires that one who comes to court seeking equity must come with 

clean hands. Id.; see Truly v. Austin, 744 S.W.2d 934, 938 (Tex. 1988); Pickett v. Heygood, Orr 

& Reyes, L.L.P., No. 05-07-00079-CV, 2008 WL 2266133, at *5 (Tex. App.—Dallas Jun. 4, 2008, 

no pet.) (mem. op.) (applying unclean hands to quasi-estoppel). 

2. Arguments by the Parties

Appellees argue the Bank accepted significant sums of money via royalty checks after 

signing the Ratification. Specifically, Appellees assert that royalties are not payments to which 

the Bank was entitled as an unleased co-tenant (as opposed to payments to working interest owners 

which are subject to costs of development). To the contrary, royalties are cost-free and are the 

creation of a mineral lease. Thus, the Bank’s acceptance of the royalty payments can only be 

consistent with continued validity of the Baker Lease through the operation of the Ratification.

The Bank contends it was not estopped from claiming that the Baker Lease terminated 

because it accepted royalties attributable to that lease and the Ratification. 

3. Analysis

In Atkinson Gas Co. v. Albrecht, 878 S.W.2d at 240, the court looked at Albrecht’s conduct 

in accepting royalty payments. Albrecht accepted royalty payments after he made clear to 

Atkinson Gas that he considered the lease to have been terminated due to cessation of production. 

Id. “The present single instance of accepting a royalty payment a portion of which [Albrecht] was 

not entitled to, was not sufficient to show that Albrecht had abandoned this position and would be 

estopped from reasserting it.” Id.; see also Fields v. Waterfield, No. 07-04-0118-CV, 2006 WL 

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176445, at *5 (Tex. App.—Amarillo Jan. 25, 2006, judg. withdrawn) (mem. op.) (holding 

acceptance of royalty payments, to which they were entitled, did not prove estoppel); Ladd Petrol.

Corp. v. Eagle Oil & Gas Co., 695 S.W.2d 99, 109 (Tex. App.—Fort Worth 1985, writ ref’d n.r.e.) 

(“[T]he mere continuance of the acceptance of royalties would not estop the [lessors] from 

challenging the lease.”). Although quasi-estoppel prevents a party from accepting the benefits of 

a contract and subsequently taking a position inconsistent to the contract, there must be a showing 

that the acceptance of royalty payments did not support an intent to relieve the gas company of 

their obligation. Atkinson Gas Co., 878 S.W.2d at 240.

The Bank’s acceptance of royalty payments after its notification to Appellees that it 

considered the lease terminated does not, without more, create an estoppel of its consistently held 

position that the Baker Lease terminated in August of 2001. Id.; Fields, 2006 WL 176445, at *5; 

Ladd Petrol. Corp., 695 S.W.2d at 109; cf. Little v. Delta Steel, Inc., 409 S.W.3d 704, 715 (Tex. 

App.—Fort Worth 2013, no pet.) (holding the plaintiff’s acceptance of worker’s compensation 

benefits for over two years was inconsistent and allowing her to assert negligence claim was 

unconscionable). The summary judgment evidence does not conclusively prove Appellees’ 

contention—that allowing the Bank to now disavow the Ratification would unfairly disadvantage 

Appellees and be unconscionable. Appellees’ summary judgment evidence fails to prove, as a 

matter of law, the Bank was estopped from asserting the Baker Lease terminated in August 2001 

and that its mineral estate automatically reverted to the Bank at that time. Lopez, 22 S.W.3d at 

864; Atkinson Gas Co., 878 S.W.2d at 240. 

To the contrary, as we previously outlined, the evidence raises genuine issues of material 

fact whether the Bank’s actions were inconsistent with its attempt to rescind the Ratification—

including whether, to effect rescission, the Bank was “ready and willing to” tender any benefits to 

which it was entitled. David McDavid Pontiac, Inc. v. Nix, 681 S.W.2d 831, 836 (Tex. App.—

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Dallas 1984, writ ref’d n.r.e.); Wilson v. Klein, 715 S.W.2d 814, 822 (Tex. App.—Austin 1986, 

writ ref’d n.r.e.). Furthermore, in light of this court’s opinion in Prize I, we cannot conclude, that 

as a matter of law, Appellees came to the table with clean hands and are entitled to raise the 

equitable defense of quasi-estoppel. 

ADVERSE POSSESSION

Appellees assert they acquired the leasehold interest in the Baker Lease by operation of the 

three-year period of adverse possession. As such, Appellees contend the Bank cannot succeed 

because Appellees have adversely possessed the leasehold interest in the Baker Lease by 

continuing to develop the lease and pay royalties to the Bank. TEX. CIV. PRAC. & REM. CODE ANN.

§ 16.024 (West 2002) (“A person must bring suit to recover real property held by another in 

peaceable and adverse possession under title or color of title not later than three years after the day 

the cause of action accrues.”). Specifically, Appellees point to their continued development of the 

property, the drilling of new wells, the production of oil and gas, and the royalties paid to the Bank 

under the Baker Lease. Accordingly, because the Bank did not file suit until after the three-year 

period expired, Appellees claim they acquired the leasehold interest, and the Bank’s claims based 

on lack of a valid lease fail.

1. Requirements to Prove Adverse Possession

Adverse possession requires possession “under title or color of title.” Id.; Wilhoite v. Sims,

401 S.W.3d 752, 757 (Tex. App.—Dallas 2013, no pet.). The Bank contends Appellees neither 

claim nor prove color of title. “‘Color of title’ means a consecutive chain of transfers to the person 

in possession that . . . is not regular because of a muniment that is not properly recorded or is only 

in writing or because of a similar defect that does not want of intrinsic fairness or honesty. . . .” 

TEX. CIV. PRAC. & REM. CODE ANN. § 16.021(2). The statute also requires that the possession be 

“inconsistent with and . . . hostile to the claim of another person.” Id. § 16.021(1). The 

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“‘possession must be of such character as to indicate unmistakably an assertion of a claim of 

exclusive ownership in the occupant.’” Rhodes v. Cahill, 802 S.W.2d 643, 645 (Tex. 1990) 

(quoting Rick v. Grubbs, 214 S.W.2d 925, 927 (Tex. 1948); McDonnold v. Weinacht, 465 S.W.2d 

136, 141 (Tex. 1971)).

“Fraudulent concealment is based upon the doctrine of equitable estoppel . . . [and] estops 

a defendant from relying on the statute of limitations as an affirmative defense to plaintiff’s claim.” 

Borderlon v. Peck, 661 S.W.2d 907, 908 (Tex. 1983). Fraudulent concealment tolls the statute of 

limitations until the plaintiff, “using reasonable diligence, discovered or should have discovered 

the injury.” KPMG Peat Marwick v. Harrison Cnty. Hous. Fin. Corp., 988 S.W.2d 746, 750 (Tex. 

1999); accord Velsicol Chem. Corp. v. Winograd, 956 S.W.2d 529, 531 (Tex. 1997). Equity tolls 

the statute of limitations because of “the defendant’s active suppression of the truth or failure to 

disclose when the defendant is under a duty to disclose.” Mitchell Energy Corp. v. Bartlett, 958 

S.W.2d 430, 439 (Tex. App.—Fort Worth 1997, pet. denied).

2. Analysis

Under the Baker Lease, the lessees held a fee simple determinable interest subject to the 

Bank’s possibility of reverter. Natural Gas Pipeline Co. of Am. v. Pool, 124 S.W.3d 188, 192 

(Tex. 2003). When the production ceased for a period exceeding sixty-days, the Baker Lease 

terminated and the Bank’s 25% mineral interest automatically reverted to the Bank. See Prize I, 

345 S.W.3d at 584–85. By virtue of the lease terminating, and the Bank’s mineral interest 

reverting, the Bank and the Rutherfords were unleased co-tenants. The Baker Lease does not 

provide, and Appellees have not provided any other evidence, that upon termination of the Baker 

Lease, the Rutherfords, or any other party, held the Bank’s 25% mineral interest under title or color 

of title. See TEX. CIV. PRAC. & REM. CODE ANN. § 16.021(2) (explaining color of title requires a 

consecutive chain of transfers); Wilhoite, 401 S.W.3d at 757.

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Based on the summary judgment evidence, we cannot conclude Appellees proved, as a 

matter of law, they possessed title or color of title to the leasehold in question. TEX. R. CIV. P.

166a(c); Nixon, 690 S.W.2d at 548. Additionally, the evidence raises genuine issues of material 

fact regarding whether Appellees’ affirmative acts to prevent the Bank’s discovery of the lease 

termination tolled the statute of limitations. See Mitchell Energy Corp., 958 S.W.2d at 439. 

Accordingly, the trial court erred in granting summary judgment on this issue.

SUMMARY JUDGMENT ON THE BANK’S REMAINING CLAIMS

Appellees contend that because the Bank’s response to the traditional motion for summary 

judgment did not address the remaining grounds for summary judgment, they cannot challenge the 

holding on appeal. Appellees also argue that with regard to its no-evidence summary judgment, 

the Bank failed to produce any new evidence and the previous evidence is insufficient to create a 

fact issue. We address each issue independently.

1. Unjust Enrichment 

Appellees argue the Bank’s fraudulent inducement claim is an unjust enrichment claim that 

is barred because an express contract governs the subject matter of the dispute. Fortune Prod., 52 

S.W.3d at 684. The Bank counters Appellees were unjustly enriched by paying only royalties 

under the Baker Lease instead of a share of production to which the Bank is entitled because the 

lease terminated. Here, Appellees contend, the subject matter of the dispute is the 25% mineral 

interest and entitlement to share of proceeds from production.

The doctrine of unjust enrichment belongs to the measure of damages known as quasicontract or restitution. First Union Nat’l Bank v. Richmont Cap. Partners I, L.P., 168 S.W.3d 917, 

931 (Tex. App.—Dallas), aff’d 168 S.W.3d 917 (Tex. 2005). “The doctrine of unjust enrichment 

does not operate to rescue a party from the consequences of a bad bargain, and the enrichment of 

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one party at the expense of the other is not unjust where it is permissible under the terms of an 

express contract.” Id.

Unjust enrichment is characterized by a party failing to make restitution for benefits 

received under circumstances giving rise to an implied or quasi-contract. Allen v. Berrey, 645 

S.W.2d 550, 553 (Tex. App.—San Antonio 1982, writ ref’d n.r.e.); TransAm. Natural Gas Corp. 

v. Finkelstein, 933 S.W.2d 591, 600 (Tex. App.—San Antonio 1996, writ denied) (en banc). The 

Bank contends there was no express contract because the Baker Lease terminated in August 2001

and the Ratification was induced by fraud. Moreover, assuming unjust enrichment, the Bank 

contends it is entitled to an accounting to determine the amount of the unjust enrichment and that 

is a question of fact that alone would bar summary judgment.

As to the no-evidence summary judgment, Appellees contend the Bank presented no 

evidence they retained a benefit to the Bank’s detriment. Because there is evidence that the 

Ratification was procured by fraud, there is a question of whether it is enforceable. The Bank’s 

original 25% mineral interest reverted to the Bank in August of 2001 when the Baker Lease

terminated. As such, the Bank contends it is a co-tenant with the Rutherfords and entitled to its 

proportionate share of any production from the leasehold. For the same reasons we concluded the 

summary judgment evidence raises a fact question as to the Ratification, there are genuine issues 

of material fact pertaining to the Bank’s unjust enrichment claim.

2. Conversion

Conversion is the “unauthorized and wrongful assumption and exercise of dominion and 

control over the personal property of another, to the exclusion of or inconsistent with the owner’s 

rights.” Waisath v. Lack’s Stores, Inc., 474 S.W.2d 444, 447 (Tex. 1971); accord Tex. Integrated 

Conveyor Sys., Inc. v. Innovative Conveyor Concepts, Inc., 300 S.W.3d 348, 365 (Tex. App.—

Dallas 2009, pet. denied) (op. on reh’g). To establish conversion of personal property, a plaintiff 

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must prove (1) the plaintiff owned, had legal possession of, or was entitled to possession of the 

property; “(2) the defendant unlawfully and without authorization assumed and exercised control 

over the property to the exclusion of, or inconsistent with, the plaintiff’s rights”; (3) the plaintiff 

made a demand for the property; and “(4) the defendant refused to return the property.” Tex. 

Integrated Conveyor Sys., Inc., 300 S.W.3d at 365–66. 

We agree with the Bank’s contentions that because Appellees’ argument is based on the 

Ratification, which was allegedly induced by fraud, the questions of fact raised earlier apply to 

this issue as well. Appellees acknowledge that they continued to make payments to the Bank, even 

after termination of the Baker Lease. The Bank’s evidence, regarding an alleged lack of full 

payment and the monies withheld by the Appellees, raises questions regarding whether such 

exercise of dominion and control over the Bank’s property constitutes conversion. Id. 

Accordingly, the trial court erred in granting summary judgment on the issue of conversion.

3. Texas Natural Resources Code

Appellees contend they are entitled to summary judgment on the Bank’s claims with regard 

to any violation by Appellees of the Texas Natural Resources Code. The Bank counters the 

argument is immaterial because the Bank’s claim is that Appellees have not timely paid the new 

revenues to which the Bank is entitled as co-tenant.

Citing section 91.402(b) of the Texas Natural Resource Code, Appellees argue that the 

Bank has not produced any evidence that Appellees were not entitled to withhold payments. TEX.

NAT. RES. CODE ANN. § 91.042 (West 2011) (outlining when payments may be withheld for 

proceeds derived from the sale of oil or gas production from an oil or gas well). Therefore, if the 

Ratification is enforceable, then the Bank is entitled only to the royalty payments it has already 

received. Appellees base this theory of recovery on the trial court’s determination on the Bank’s 

claims seeking to rescind the Ratification. Once again, this becomes a circular argument. Because 

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we previously concluded genuine issues of material fact exist as to the Ratification, there are also 

genuine issues of material fact as to violations of the Texas Natural Resource Code. Accordingly, 

the trial court erred in granting summary judgment as to the Bank’s claims under the Texas Natural 

Resource Code. 

CONCLUSION

Having reviewed the evidence, we conclude the summary judgment evidence raises 

genuine issues of material fact on each of Appellees’ theories, and the trial court erred by granting 

Appellees’ motion. See TEX. R. CIV. P. 166a(c),(i); Nixon, 690 S.W.2d at 548; Romo v. Tex. Dep’t 

of Transp., 48 S.W.3d 265, 269 (Tex. App.—San Antonio 2001, no pet.). Accordingly, we reverse 

the trial court’s grant of traditional and no-evidence summary judgment and remand this cause to 

the trial court for further proceedings consistent with this opinion.

Patricia O. Alvarez, Justice

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