### TEXA S C OU R T OF A PPEAL S, THIR D DIST R ICT , AT AU STIN

NO. 03-04-00109- CV

The Ele c tr ic Re lia bili tyCo unc il o f Te xa s, Inc ., App e lla nt
v. Met Cente r P artner s-4, Ltd., Appellee

F ROM THE DISTRICT CO URT OF TRAVIS COUNTY , 126TH JUDICIAL DISTRICT NO. GN300722 , HO NORAB LE DARLENE B Y RNE, JUDGE P RESIDING

M E M O R

A N D U M O P I N I O N
I n this appeal, we must dec ide whethe r a la ndlord’s notice of

rec eipt of a bona

fide of fe r t rumps a te na

nt’ s exer c ise d pur c ha se op tio n ba se d on the te rm s of a rig ht of fi rs t re fu sa l in the ir building’s lea se. Electric Reliability Council of Texas, I nc. (“ ERCOT”) a ppeals the district c ourt’s take- nothing judgment declaring afte r a jury trial that, under the terms of the pa rties’ lea se, ERCOT’s previously

exercised option to purcha se t he buil ding terminated when Met Center Par tners-4, L td. g ave E RCOT notice of a third pa rty ’s bona f

ide offe r. ERCOT challeng es the judg ment by ar g u in g th a t (i) Met Center

did not rece ive a bona fide off er a s a matter of

law and the j ury ’s findi ng of a bona fide offe r should be disreg arde d as an immaterial answe r to a leg al question, (ii) the e vidence was fa ctually insu ff i cient to support the jury ’s finding of a bona

fide off er, ( iii) the lease ’s right of first re fusal did not trump ERCOT’s2

e xer c ise d p ur c ha se op tio n, and (i v) Me t Ce nte r c ou ld n ot i nv ok e the ri g ht o f f ir st r e fu sa l be c a

us e it repudiated the purc hase option.

We conclude that (i) ERCOT waived a ny issue o n t h e b ona fide offe r question, a mix ed question of la w an d fa ct , b y failing to object to the submission of the question during the char g e conf

ere nce, ( ii) the evidenc e wa s fac tually sufficie nt to support the finding of a bona f ide of fe r, (i ii) the langua g e of

the pa rt ie s’ le a se e xpre sse d the ir int e nt that the ri g ht of fi rs t re fu sa l tr ump the purc hase option, and ( iv) the jury ’s finding s of Met Center ’s re pudiation were rende red immaterial by

the cour t’s decla ration that the rig ht of first refusal trumped the pur chase option. Ac c or din g ly , w e a ff

ir m th e dis tr ic t c ourt ’s jud g me nt.

BACK GR OUND T h e L ea s e T er ms

ERCOT is a nonprofit corpor ation responsible for coordinating power transmission
and pr e ve nti ngpo we r o uta g e s th ro ug ho ut m os t of Te xas. Me t Ce nte r Part

ne rs -4 , L td. is a

re a l e state limit ed par

tnership that owns B uilding Thre e in a de velopment at the intersec tion of State Hig hway 71, Riverside Drive , and State Hig hway 183 in Austin. Zydeco D evelopment, Inc., is the compa ny that is Met Center’s sole g ener al par tner. Ef fec tive J uly

21, 2000, b ef

o re the construction of B uil din g Th re e , E RCO T l e a se d th e bu ild ingfr om M e t Cen te r fo r a te rm of 12 0 mo nth s, re ne wa ble for two c onsecutive f

ive-y ear periods. The lease d premises in the completed she ll of the building consisted of a

pproxi mately

45,000 square fee t. Met Center provided ERCOT a $20 per squa

re f oot finish-out allowanc e, a total of $900,000. After making ERCOT’s reque sted cha ng es to the shell of the building, Me t Center paid ERCOT $315,274, the balance of the fini sh-out allowanc e. In addition3

to t he se bu ild ingmod if

ic a tio ns , E RCO T i ns ta lle d speci ali zed e qu ipm e nt i ns ide the pr e mis e s to maintain the g rid of ele ctric tra nsmissi on lines that serve most of the state. The pa rties have had a stra ined re lationship since the lease was sig ned. Met Center missed the building’s tar g eted c ompletion deadline. Displea sed, ERCOT moved into the building without notify ing Me t Center. Upon discove ring that ERCOT had occ upied the building, M e t C e nter demande d that ERCOT beg in paying r ent. ERCOT then beg an sendingever y rent pa y ment with a state me nt t

hat it wa s ma de “ un de r p ro te st. ” ERC OT and Me t Ce nte r a lso dis a g re e d a bo ut t he c os t of ERCOT’s re quested modifications to the building. The parties’ mutual distrust culminated in the prese nt liti g ation over the eff ect of Met Center’ s notice of its rec ei pt of a bona fide off er on ERCOT’s exercised pur chase option.

“ Exhi bit D” to E RCO T’ s le a se c on ta ine d tw o p urch ase optio ns and a ri g ht o f f ir st
re fu sa l f o r t h e p r o p e rt y . T h e f

i r s tp u r c h a s e o p t i o ni np ar a g r a p h 2 ( a ) g a v e E R C O T t h e r i g h tto purcha se the prope rty

for a fix ed pric e and w as not subject to te rmination by the rig ht of first ref usal provisions in parag raph 2( c): (a) Tena nt shall have the rig ht to purcha se the Proper ty for a price of $5,850,000.00 p ay ab l e i n cash at the closing by g iving L andlord wr itten notice of Te nant’s exercise of

its right to purc hase the Property at any time p ri o r t o the date on which the Te nant I mp ro v em ents are substantially completed or

the City of Austin issues a Certificate of Oc cupanc y for the leased premises, whiche ver occur s first; provided Te n ant is not in default her eunder at the time such rig ht to p ur c ha se is e xer c ise d o r at th e c los ingof the sa le and

purc ha se of

the Pr op e rt

y pursuant ther eto.
ERCOT did not ex erc ise this pre-oc cupanc y purcha se option.The jury found that the use of

the number 60 a s the denominator inst ead of 120—the total 1 number of months in the l ea s e’ s i n i tial term—resulted f rom the par

ties’ mutual mistake. The jud gm en t re fo rmed the le ase, c hang ing the fra ction’s denominator to 120 months. Thus, the ref ormed c alculation wa s FMV – improv em en ts’ contribution to FMV – $900,000 x lease ’s rema ining months/120 = price
. 4

ERC OT did e xer c ise the mark e t- pr ic e purc ha se op tio n und e r p ara g ra ph2( b) . T his
se c on d o pti on

wa s ava ila

bl e to E RCO T a

ny tim e duri ngthe te rm

of the le a se and

wa s su bje c t to te rm inatio n b y

the ri g ht o f f

ir st r e fu sa l in

pa ra g ra ph2( c ). Th is le a se pr ov isi on c on ta ine d a

fo rm ula for c alculation of the purcha se price and a method for selec ting appra isers to resolve disputes over fair ma rket va lue: (b) I f Tena

nt fa i l s to ex erc ise its right to purc hase the Property as set for th in (a) above, T enant sha ll have a c ontinuing rig ht to purchase the property during the te rm of thi s L e a se and

pr ov ide d T enan t is no t in de fa ult he re un de r a

t th e tim e such rig ht to purchase is ex erc ised or at the c losing of the sale a nd purcha se of the Property

pursuant ther eto for a pric e equa l to the Fair Marke t Value of

the Property reduc ed by

an amount equa l to (1) t he amount by which the f air mar ket value of the improvements to t he L ease d Premises the cost of which have be en pa id b y Te na nt ( e xclu siv e of

the Te na nt A llo wa

nc e ) c on tr ibutes to th e F a ir Marke t Value of

the Property , (2) multiplied by a fr action, the numer ator of wh ic h is the numbe r of mon ths re ma ini ng in the un e xpir e d ini tia l Te rm of thi s L e a se , a nd the de no min a tor

of wh ic h is 60 mon ths
. Te na nt s ha ll exer c ise its 1 rig ht to purchase the Property pursuant to the provisions of this parag raph ( b) by g iving L andlord wr itten notice of Te nant’s exerc ise of its rig ht to purchase the Pr op e rt y (“ Pur c ha se Op tio n N oti c e ” ). Th e Fa ir Mark e t V a lue of

the Pr op e rt

y sh a ll b e de te rm ine d a s f

oll ow s: (i) Wit hin fifteen ( 15) day s after t h e d ate of the Purchase Option Notice, L andlord shall g ive Tenan t wr itten notice of L andlord’s de termination of the Fa ir Marke t Value of

the Property

setting f orth in rea sonable de tail the assumptions and data upon whic h such dete rmination is made. I f Tena nt disag ree s with L andlord’s de termination of the F air Mar ket Value of the Property , Tena

nt shall give L andlord notice of such disag ree ment , an d of Te na nt’ s d e te rm inatio n o f t

he F a ir Mark e t V a lue of t he Pr op e rt y , w ith in fiftee n (15) da

y s after the date of

the notice of L andlord’s determination ofThe mention of a “re newa l notice” is i napplicable beca use the lea se wa s in its i nitial 120- 2 month term. Met Center’ s counsel re called E RCOT’s former counsel testify ing that the “re newa l notice” phrase was an err or. That rema rk did not draw a

n objection at trial a

nd the phra se does not appea r elsew here in thi s p urcha se option or in the rig ht of first re fusal. Our revie w of the r ecor d sug g ests that the phra se may have be en mistakenly

copied f rom the “Rene wal Options” section of the lease , immediately

prec eding the purc hase options and the r ight of first ref usal section. 5 the Fa ir Marke t Value. In the event Te nant fa ils to so give L andlord notice of Tenant’s di sag ree ment with L andlord’s determination of the F air Mar ket Value of the Property , Tena

nt shall be conc lus i v el y d eeme d to have acc ep t ed L andlord’s de termination of the F air Mar ket Value of the P r o p e rt y. (ii) I f Tena

nt give s L andlord notice of Tena nt’s disag ree ment with L andlord’s de te rm inatio n o f t

he F a ir Ma rk e t V a lue of

the Prop ert y as pro vid e d in pa ra g ra ph(i ) abo ve , L and lor d a nd Te na nt s ha ll i n g oo d f

a itha tte mpt

to ag ree on the Fa ir Marke t V alue of the Proper ty . I n the eve nt L andlord a nd Te na nt f a il t o ag re e on the F a ir Ma rk e t Va lue of the Pr op e rt

y wi thi n s ixty (60) da y s after the date of

the Renew al Noti ce , the Fa ir Marke t Value of 2 the Pr op e rt

y sh a ll b e de te rm ine d b y an a pp ra isa l in accor da

nc e wi th para g raph ( d) below. (iii) L andlord a

nd Tena nt shall attempt in go od faith to mutually ag ree on an appra iser to make suc h deter mina t ion. In the eve nt L andlord a nd Tena nt fa il t o a g re e on

su c h a pp ra ise r w ith in s e ve nty -f

ive (7 5) da

y s a ft e r t he date of the Purcha se Option Notice, then L andlord shall selec t an appr aiser a nd Tena nt shall select an a

ppraiser by g iving the other party written notice of the name of

the a pp ra ise r so se le c te d with in e ig hty (8 0) da y s a ft e r t he date of the P u r c h a s e O p t i o nN o t i c e . T h e t w o ( 2 ) a p p r a i s e r s s o s e l e c t e d

s h a l l, within ninety

(90) da y s after the date of the P urcha se Opti on Notice, se lect a third app ra i s er, w hich third appra iser shall dete rmine the F air Mar ket Value of the P roper

ty within thirty (30) day s afte r t he date of the sele ction of such a ppraiser . The F air Mar

ket Value of t he P roper

ty as determined by the apprai s al shall be used to c alculate the monthly Ba se Rent for the applicable extension t erm in acc ordanc e with pa rag raph ( a) a

bove. In the event e ither par

ty fails to s el ect a

n appra iser as pr ovided her ein, the appra iser selected by the ot her party shall deter mine the Fa ir Marke t Value of the Proper

ty . The cost of the appra isal shall be divided equa lly betwee n L andlord a

n d Tena nt. Any appra iser sele cted he reunde r shall (i) not be a partne r, joint venturer

or shareh older with L andlord or T enant in any partne rship, j o i n t venture , trust or corpor ation, other than a partne rship,6 trust or corpor ation whose shar es or e quity interests ar e publicly

trade d on a national stock exchang e; (ii ) shall not be owne d or controlled by L andlord or Tena nt; (iii) shall have been ac tively eng ag ed for

at least ten ( 10) y ear s immediately

prec eding his selection in co m m ercial rea l estate a ppraisal activities in the City

of Austin, Texas; and (iv) shall be a member in g ood sta nd ingof the Am e ri c an Ins tit

ute of Re a l E state Ap pr a ise rs . Paragr ap h 2 (c) contained the rig ht of first re fusal that Met Center invoked, which states that the provisions of the marke t-price purcha se opt ion will “cea se and te rminate” when Me t Center de livers notice of

a third par

ty ’s bona f

ide offe r to ERCOT: (c ) L and lor d f

ur the r g ra nts to T e na

nt a ri g ht o f fi rs t re fu sa l to p ur c ha se the pr op e rt y a s f oll ow s[:] (i ) Notwi thstanding t he provisions o f ( b) above [mark e t- pr ic e purc ha se op tio n], i n th e e ve nt L and lor d r e c e ive s a bo na fi de of fe r f ro m a thi rd pa rt y to purcha se or ac quire the Prope rty that is acc eptable to L andlord, L andlord sh a ll n ot s e ll a

nd c on ve y the Pr op e rt

y wi tho ut fi rs t of

fe ri ngthe same to Tena nt upon the same price, terms and conditions as contained in the bona fide offe r. L andlord shall g ive Tena nt w ritten notice of rec eip t o f s uch bona fide acc eptable offe r, which notice shall contain the price , terms and conditions of such offe r, toge ther with a c opy of such of

fer
. Up on de liv e ry of such notice to Tenant, Tenant’s right to purchase the prope rty pursuant to p arag ra ph ( b) ab ov e sh all

c e as e an d te rm ina te . (Emphasis adde d.)

The next par ag raph, 2(d), stated that “unless other wise provided he rein or unde r the t e r m s o f an o f

f e r , ” c l o s i n g f

o r t h e s a l e an d p u r c h a s e o f t h e p r o p e rt y w o u l d

o c c u r w i t h i nt h i rt y d a ys afte r the date the option or rig ht of first re fusal wa s exercised. The closing did not occur.All of the cor responde nce r efe renc ed is betwe en H o wa rd Yancy , president of Z y deco 3 Deve lopment, I nc., Met Center ’s s o l e gener al par tner, a nd Thomas Noel, pr esident of ERCOT, unless otherwise note d. 7 The Fair Market

Value Dispu te The e vents prec eding the suit to construe the lea se occ urre d i n 2003 and most are documented in the pa

rties’ c orre spondence
. ERCOT, throug h its president, Thomas Noe l, exercised its purchase option in writing on January 8 and, in ac corda

nce w ith the lease, r equeste d Met Center’ s de te rm inatio n of the pr op e rt y ’s fa ir mark e t va lue wi thi n fi ft e e n da y s, a lon g wi th the r e a so na bly detailed a ssumptions and data supporting its dete rmination. On J anuar

y 21, Howar d Yanc y , Met Center’ s presid en t , wr ote to ERCOT
a c kn ow le dg ingits e xer c ise of the purc ha se op tio n a

nd sa id that “ the purp os e of

[its] l e tte r [w a ]s to
se t f or th L a nd lor d’ s d e te rm inatio n o f t he Fair Mark e t V a lue of

the Pr op e rt

y in a c c or da

nc e wi th Parag raph 2( b)(i) of

Ex hibit D t o the L ease Ag ree ment [t he market-pric e purchase option] .” Met 3 Center then inf

ormed ERCOT that Da

niel Macke of the Mac ke Company had bee n discussing the “potential purc hase of

the prope rty ” with Met Center , but Ma cke had not made an of fer befor e Met Center r ece ived ERCOT’s purc hase option notice. Met Center also wrote that, after rec eiving the notice, it communicated E RCOT’s exercise of its option to Macke , and Mac ke submitted a “ba ckup” off er f or the prope rty

in the event that Me t C enter and ERCOT did not consummate the sale
. Met Center e nclosed a

copy of a le tter fr om Macke , dated January 17, offe ring to purcha se the proper ty for $6,885,000.Macke require d thirty day s from the date of a

n executed purc hase a g ree ment for r eviewing 4 d ocuments, obt a in in g in s p e c ti o n s , an d “ d o [i n g ] th a t w h ic h , in th e o p in io no f

B u y e r , [w a ]s nece ssary .” I f unsatisfied with the r esults of such inspec tions and investi g ations, Macke rese rved the rig ht to terminate the purc hase a g ree ment without obligation or liability to Met Center. This w as also the date of Met Center’ s response to ERCOT’s pur chase option notice. Met 5 Center’ s subsequent re liance on Ma cke’ s offe r shows that it did not ex pire on January 21. 8 The Mac ke letter stated its unde rstanding that its off er was submitt ed “in a bac k-up position and that ERCOT ha[d] an option to purchase.” I n addition to the price, the Macke letter
c on ta ine d a

g e ne ra l de sc ri pti on

of the pr op e rt

y , d e po sit te rm s, and

du e dil ig e nc e c on dit ion s. I t a lso 4 proposed a

closing timeline, a method for c alculation of c losing c osts, a list of ten t y pes of documents to be de livered to Mac ke “upon e x ecution of the purchas e agr ee m en t or ea rlier,” and specifie d that its offe r was only valid until 5:00 p.m . on J anuar y 21. Macke ’s letter c oncluded by 5 stating [t ]hi s invitation i s non-bindi n g o n ei t h er pa rty . I t must be understood that neither pa rt y ha s any bin din g ob li gati on to the oth e r u nti l su c h ti me a s a

fo rm a l pu

rc ha se ag ree ment has bee n approve d and executed by both parties and that neither this letter no r a ny pa st nor futur e or a l com mun ic a tio ns be tw e e n r e pr e se ntativ e s o f e ith e r p art y shall constitute a binding oblig ation.
B a se d o n th is l e tte r, wh ic h M e t Ce nte r c a ll ed the “ be st e vid e nc e of fa ir mark e t va lue ” in i ts possession, Met Center told ERCOT that its determination of the prope rty ’s fa ir marke t value wa s $6,885,000. Disag ree ing w ith that determination, ERCOT wrote to Met Center on Fe bruar y 4 and reje cted the ide a that “a

conditional purcha se off

er [wa]s a true indicator of marke t va lue.” I nstead, ERCOT pr oposed that the fair marke t va lue of the proper ty was the 2002 Tr avis County Appra isal9

District’s assesse d value of $4,231,483. ERCOT claimed it was e ntitled to a 40% cre dit from that fig ure a s the amount that its improvements contributed to the prope rty ’s fa ir marke t value.

Met Center r esponded by

letter the next day , stating that it disagr eed w ith ERC OT’s proposed va lue of $2,538,890 ($4,231,483 le ss 40%), and r eiterat i n g t h at “there [wa]s no better deter mination of the fair

marke t value than what a willing buy er w ould pay a willing se ller for

that proper ty .” Met Center said that if the property wer e purc hased “ in acc ordanc e with the ter ms and
c on dit ion s of the Th ir d Part y Of fe r, the purc ha se pr ic e re fl e c te d the re in wo uld in fa c t be t he Fa ir Marke t Value of

the Property .” With t h at i n m i n d , Met Center sug g ested that Mac ke buy the proper ty and that the lea se ag ree ment be rev i s ed t o p er m it ERC OT to purcha se the prope rty from Ma c ke if ERC OT pa id at le a st the same pr ic e that Mac ke pa id fo r it. Me t Ce nte r o bs e rv e d th a t it s proposal wa s “exactly

what would have occur

red had Tena

nt not sent L andlord the pur chase option notice, ex ce p t t h at Tena

nt would stil l retain the r ight to purc hase the proper ty for F air Mar

ket Value.” I f that pl an wa s unacc eptable to ERCOT, Met Center offe red to re duce the purcha se price of the prope rty

by the amount of c osts that it would incur under t he Mac ke off er but not under

the le a se , s uc h a s th e br ok e ra g e c omm iss ion and the tit le ins ur anc e fe e . M e t Ce nte r a lso state d th a t it
re m a i n e d o p e n t o o t h e r i d e a s t o d e t e r m i n e t h e f

a i r m ar k e t v a l u e i f E R C O T w a s s t i l l i n t e r e ste d in b u yi n g t h e p r o p e rt y.

ERCOT’ s letter to Met Center on Fe bruar

y 13 voiced its dissatisfaction with Met Center’ s proposal bec ause its estimate of f air mar ket value did not include any cre dit for the amount that ERCOT spent on improvements. Reg ardingthe Mac ke purc hase, ERCOT questioned why Mac ke wo uld

wa nt t o p ur c ha se the pr op e rt y fo r $ 6, 88 5, 00 0 o nly

to s e ll i t to ERC OT a t a los s.Met Center’ s J anuar y 21 letter stated that i t s p urpose wa s to set forth Met Center ’s 6 de te rm inatio n o f t

he pr op e rt

y ’s fa ir mark e t va lu e in a c c or da

nc e wi th t he purc ha se op tio n. I t a lso informed ERCOT that Mac ke had not made an off er on the proper

ty befor e Met Center

rec eived ERC OT ’s purc ha se op tio n n oti c e . T he le tte r d id n ot m e nti on the ri g ht o f f

ir st r e fu sa l. 10 ERCOT expl ained that if it re tained its purcha se option under the le ase, i t could still deduct the contributed value of its improveme nts f rom the asser

ted fair marke t va lue of $6,885,000. ERCOT
c omp la ine d th a t Ma c ke ’s inj e c tio n in to t he pr oc e ss u

nn e c e ssa ri ly c omp lic a te d t hei r effo rt to deter mine fair market value and the amount by which the improvements contributed to that va lue. I t also noted that “[s] cena

rios that might have occur red ha d ERCOT not ex erc ised its purc hase option
are immaterial, as ERCOT did exercise that option.” To resolve the matter, ERC OT sugg ested that the y “ sp lit the dif fe re nc e ” be tw e e n the ir tw o off e rs fo r a va lue of $5 ,5 58 ,1 41 .5 0. I t c on dit ion e d th is
a g re e me nt o n r e c e ivi nga

40 % c re dit

tow ard the fa ir mark e t va lue fo r i ts i mpr ov e me nts
. The s am e day , Met Center r ejec ted ERCOT’s sug g ested va lue of $3,334,884.90 ($ 5, 55 8, 14 1. 50 le ss 4 0% ) i n w ri tin g . M e t Ce nte r a lso a sse rt e d th a t the imp ro ve me nts ERC OT pa id for did not contribute to the f air marke t va lue of the proper ty . Met Center sug g ested a meeting for further discussion. Me t Ce nte r s e nt a

no the r l e tte r t o E RCOT o n F e br ua ry 19 to c lari fy

that it s f ir st response to ERCOT’s notice —despite being written as an acknow ledg ment of ERCOT’s exercise d purc ha se op tio n a

nd a pr of fe r o f f a ir mark e t va lue un de r t

he purc ha se op tio n—

wa s in te nd e d to a lso invoke the rig ht of first re fusal. Conceding that it was “not cle ar” in that reg ard, Met Center stated 6 that this letter would serve as its notice to E RCOT of rec eipt of an a cce ptable, bona f ide offe r under the lea se. I n a c c or da

nc e wi th t

he le a se ’s ri g ht o f f

ir st r e fu sa l, M e t Ce nte r i nv ite d E RCO T t o11

purc ha se the pr op e rt

y by ma tc hin g Ma c ke ’s of

fe r. Th e same da

y , Met Ce nter

se nt a n e -m a il t o ERCOT r equesting a meeting “to work out the fair marke t va lue/purcha se price of B uilding Thre e.”

Attorney Daniel B itting wrote to Met Center on ERCOT’s be half on F ebrua ry 28 and expressed doubt about the va lidity of Met C enter ’s purporte d invocation of the r ight of first ref usal beca use ERCOT had pre viously exercised its purchas e option. He a lso noted that he had not
rec eived his re queste d

a s s u r ance s that Met Center “ acknow ledg ed and w ould comply with ERCOT’s contra ct to purcha se the prope rty under the purcha se option.” He further stated that ERCOT g ave
no tic e of its int e nt to purc ha se the pr op e rt y if Me t Ce nte r’ s a tte mpt e d invo c a tio n o f t he ri g ht o f f

ir st ref usal wa s fi n al l y d eter

mined to be valid and if ERCOT did not purcha se the prope rty under the purcha se option. He c oncluded by confirmingthe par

ties’ meetingschedule d for Ma rch 3. Attorney Kathry n Allen wrote to ERCOT on Met Center’s be half o n M arch 3, fo rw ard ingMa c ke ’s re vis e d o ff e r d a te d Fe br

ua ry 24 , whi c h wa s “ g ive n in su bs tit uti on ” fo r t

he fi rs t offe r. The new Macke offe r mirrore d the former , including its spec ific desig nation as a non- binding invitation, but it de leted the sentenc e that rec og nized ERC OT’s purc hase option and c hara cter ized itself as a ba ck-up of

fer . I t also set a new

acc eptanc e dea dline of 5:00 p.m. on Marc h 3. ERCOT, Me t Ce nter, and their re spective c ounsel met on Marc h 3. When it appear ed tha t N o e l, E RC O T ’ s p r e s id e n t, w a s d e ta in e d , th e p arti e s b e g an n e g o ti a ti n g in h is a b s e n c e . They tentatively

ag ree d on a price rang e with a $5.85 milli on floor and a $6.4 milli on ceiling . After Noel
arr ived at the m eeting , he rejecte d the proposal. Both Met Center and ERCOT had appr aisals of the proper ty at the time of this meeting but neither of the cor porate presidents kne w that any appra isal
e x i s t e d
. N o e l w a s a l s o u n aw ar e o f ani n t e r n a l an a l ys i s t h a te s t i m a t e d t h e v a l u e o f

t h e p r o p e rt y.ERCOT nonsuited its claims for unjust enrichment and qu an tum me ru it duri ngtr ia l. 7 12 On Marc h 31 , Me t Ce nte r ma de a “ pr ote c tiv e de sig natio n” of its a pp ra ise r t o c omp ly with the purcha se option of the lease
. Met Center specific ally denied that the pur chase option was operative. ERCOT desig nated its appra iser the same day . On April 22, Met C enter notified ERCOT that Me t Ce nte r h a d b e e n “ un a ble to c on fi rm that the a

pp ra ise r s e le c te d b y

ERC OT po sse sse [d] a ll of the qua lifications” re quired by the lease
. Met Center r equeste d that ERCOT supply information or docume ntation supporting its appra iser’s qua lifications, but ERCOT did not respond.
The Lawsu it Met Center f iled suit on March 5 for

decla ratory judgme nt and re formation of the lease
. ERCOT counter claimed for declaratory judgme nt, brea ch of c ontrac t, specific pe rfor mance , fra udulent inducement, unjust enric hment, and qu an tum me ru it
. The c ourt’s cha rg e aske d the jury 7 twenty -two questions, some with multipl e subpar ts. During the charg e conf ere nce, E RCOT did not object to question number 12 c oncer ning Me t Center’s r ece ipt of a bona f ide offe r. At the conc lusion of the trial, the jury found that ERCOT

• exercised its purcha se option,

• was not in defa

ult under the lea se at a

ny t i me following the exercise of the option,

• was re ady , willing, and a ble to perf

orm all its duties and obli g ations under the option,

• fa ile d to se le c t an a

pp ra ise r w iththe qu a lif

ic a tio ns re qu ir e d b y the le a se and its failure to do so was not excused,13

• did not fail to attempt to agre e i n go o d faith t o the fa ir marke t value of the proper ty prior to Marc h 9, and

• was e ntitled to $275,400 of rent paid since the ex er ci se of its option, plus a tto rn e y ’s fe e s. The jury also found that Met Center

• did not commit fraud or statutory fra ud b y p ro m i s ing E RCOT a cre dit toward the purc hase pr ice of

the prope rty

upon the exercise of

the purc hase option,

• re pu diate d th e purc ha se op tio n by (i ) d e ny ingtha t E RCO T w a s e nti tle d to c re dit for tena nt i m p ro vements ag ainst the purcha se price and (ii) de ny ing that the option was operative, and its repudiation wa s not the result of mutual mistake, and

• r e c e i v e d

a b o n a f i d e o f f e r a c c e p t a b l e t o i tf o r t h e p u r c h a s e o f

t h e p r o p e rt y. The jury further found that the lea se’s use of 60 instead of 12 0 in the denominator of the fra ction used to ca lculate f

air mar ket value w as the re sult of the parties’ mutual mist ake. ERCOT moved for judgme nt a nd reque sted that the cour

t disreg ard the jury ’s answe r to the bona fide offe r question. Met Center moved for judgme nt se eking a dec laration that the rig ht of first re fusal trumped the purcha se option. Met Center a lso sought attorne y ’s fe es and r efor mation of the lea se to cha

ng e the de nominator of the f rac tion used to calculate fa ir marke t value. Ba sed on the jury ’s af

firmative r esponse to the b o n a fide offe r question, which trig g ere d the rig ht of first re fusal, the district cour t’s judgme nt stated:
I T I S FURTHER OR DE R ED, ADJUDGED, a nd FI NAL L Y DECREED that decla ratory relief be ente red pur suant to para g raph 2( c) of EXHI BI T D to the L ease , upon delivery

of notice to Def

endant The Electric Reliability Council of Texas, I nc. of the off

er pr esente d by

The Mac ke Company

to purchase B uilding Thre e,14

Def endant’ s rig ht to purchase Building Three pursuant to pa rag raph 2( b) ce ased a

nd terminated in a ll respec ts, notwithst anding its effort to exerc ise rig hts under para g raph 2( b) by

letter dated J anuar

y 8, 2003.
The c ourt order ed a take-nothing judgme nt on ERCOT’s counterc laims ag ainst Met Center a nd assessed c osts ag ainst ERCOT. ERCOT filed a motion for new trial, and Met Center filed a motion to m od if y the jud g me nt re qu e sti ng a tto rn e y ’s fe e s und e r the Un if or m De c lara

tor y Judg me nts Ac t. The c ourt denied both motions. This appeal f ollowed.
AN AL YSI S The Bon a F ide Of

fer Question ERCOT ar g u e s th a t M e t C e n te r w a s n o t e n ti tl e d

to ju d g me n t b e c a

u s e it d id n ot
rec eive a bona fide offe r as a

matter of law and that the bona fide off er que stion im proper ly

asked the jury to decide a

leg al issue. See , e.g. , Ergon, Inc. v . Dean , 6 4 9 S. W. 2 d 7 7 2 , 7 7 6 (Te x. Ap p . — Au s t i n 1 9 8 3 , n o wr i t ) ( ci t i n g Mo bil Che m. Co. v . B e ll , 517 S.W .2d 245, 253 (Tex. 1974)) (cour t should not subm it special issue to jury that require s i t t o d et ermine question of law). B ut when the court gave ERC OT t he opportunit y to comment at the cha rg e conf ere nce, E RCOT did not object to the submission of the bona fide offe r question or its acc ompanying instruc tion:
THE COURT: Al l ri g ht. Counsels, w e’r e i n t h e f o rm al ch ar ge confe renc e for

Met Center vs. ERCOT ca se.

. . . . THE COURT: Okay . L et’s g o to No. 12. Any o b j ec t ion from the plaintiff?15

[C ounsel for Me t Center]: Your Honor , beca use the contra ct talks about bona fide and not the wor d bi n d i n g, we objec t to the portion of the de fi nit ion

that ta lks a

bo ut bin din g and

wo uld a sk that this be limi ted to an instruc tion that a bona fide offe r is one made in good f aith. [C ounsel for ERCOT]: No objection. T H E C O U R T : Ok a y . Yo ur o b j e c t i o n , [c o u n s e l f

o r M e tC e n t e r ], is noted and ove rruled. I

think I g ot this l an guag e fr om one of the c a s e s th a t w a s te n d e r e d to th e c o u rt b y

the plaintiff.
I n order to avoid submitt ing que stions of law to the jury , the trial court must ex amine the contra ct to deter

mine what the c ontrac t require s of the par ties. Rodgers v. RA B Invs., Ltd. , 816 S.W .2d 543, 551 (Tex. Ap p .—Dallas 1991, no wr it). The cour t should submi t to the jury any disputed factual

issues reg ardingfailure of a pa rty to conform to the c ontrac t. Id. (c iting IT T Commercial Fin. Corp. v. Riehn , 796 S.W .2d 2 4 8 , 253 n.3 (Tex. App.—Dallas 1990, no wr it)). When the jury

deter mines co n d uct, it is not m aking a dec ision on the law. Id . at 55 1- 52 ; se e als o Various Opportunities, Inc. v . Sullivan Invs., Inc

. , 677 S.W .2d 115, 120 (Tex. App.—Dallas 1984, no writ ) (u n n ec es s ar y

for jury to determine le g al ef

fec t of contra ct in order

to determine f

actua l ability and intentions to perfor

m thereunde r). Q u e s t i o nN o . 1 2 a s k e d

t h e j u r y:
Di d M e t Ce nte r r e c e ive fr om t he Ma c ke Com

pa ny a bo na fi de of fer a c c e pta

ble to M e tC e n t e r

f o r t h e p u r c h a s e o f

t h e p r o p e rt y? Yo u a re he re by ins tr uc te d th a t a

“ bo na fi de of fe r” is o ne ma de in g oo d f a ithc a pa ble of beingacc epted so a s to ripen into a valid and binding contra ct th at could be e nf or c e d b y any pa rt y to i t.16

Answer “Ye s” or “ No.”
Her e, the incorporated i nstruction on bona fide offe r re quired the jury to determine a

fac t question on conduct—whe ther the of fer was made in good faith—befor e it could find the exist ence of a bona fide off er. Th e e rr or

of int e rm ing lin g ma tte rs that w e re pr op e r f or the jur y ’s de te rm inatio n w ith matters only

the cour t should have dec ided is an er ror that is wa ived by

failure to ob

j ec t t o the char g e. Ballesteros v. Jone s , 98 5 S.W. 2d

48 5, 49 9 ( Te x. Ap p. —Sa n A nto nio 19 98 , p e t. d e nie d) ; see also Tex. R. C iv. P. 274. Parties must timely and plainly make the trial cour t awar e of a

complaint about a jury char g e and obta in a ruling to preser ve er ror. Fi rst Va lle yBa nk of L os Fr esn os v . M

ar tin , 144 S.W .3d 466, 474 (Tex. 2004) (W ainwrig ht, J ., concur ring ) (c iting Sta te De

p’ t of Hi gh way s & P u b

. Tra n s

p . v . Payne , 8 3 8 S.W .2d 235, 241 (Tex. 1992)). We conc lude that Question No. 12 prese nted a mix ed question of l aw and fac t to the j ury and that ERCOT waived this issue by failing to object to the submission of the question during the char g e conf ere nce. We ove rrule E RCOT’s first issue.
F ac tu al S uffic ie nc y o f Bona F ide OfferF indin g

ERCOT also challeng es the fa ctual suff iciency of the e vidence supporting the jury ’s finding of a bona

fide offer. When conducting a factual sufficiency revie w, we must consider all the
e vid e nc e , b oth

in f a vo r o f a nd c on tr ary to the ve rd ic t, and wi ll se t it a sid e on ly if it is s o c on tr a ry to the ov e rw he lmi ngwe ig ht a nd pr e po nd e ra

nc e of the e vid e nc e a s to be m anif e stl y wr on g and

un jus t. Ortiz v. Jones , 917 S.W .2d 770, 772 (Tex. 1996). ERCOT specific ally claims that t h er e i s not17

enoug h evidenc e to support the jury ’s finding that Macke intended to be bound by his letter to Met Ce nte r. Me t Ce nte r argue s that the re c or d sh ow s Ma c ke ma de a g oo d f a ithof fe r t hat w a s c a

pa ble of ripeninginto a contra ct and that the of fer was a cce ptable to Met Center
. Be cause ERCOT did not obje ct to the jury char g e, we revie w the suff iciency of the evidenc e on the bona

fide off er que stion in l ight of the cha rg e submitted. Se e Brad

for d v . V e nto , 48 S.W .3d 749, 754 (Tex. 2001). I t is the court’s cha rg e, not some other uniden tified law, that
measure s the sufficie ncy of the e vidence when the opposingparty fail s t o o b

ject to the cha

rg e. Osterberg v . Pec a , 12 S.W .3d 31, 55 (Tex. 2000). I n the absence of a proper objection, the court’s char g e is controlling , even if the cha rg e is not entirely

corr ect. W

al-Mart Stores, Inc. v . Sturges , 52 S
. W
. 3 d 7 1 1 , 7 1 5 (T ex . 2 0 0 1 ) (s u ff i ci en cy o f ev i d en ce m u s t b e as s es s ed“i n l i gh to f t h e j u ry

ch ar ge the district court g ave wi tho ut o bje c tio n” ); City of Fort W orth v. Zimlich , 2 9 S. W. 3 d 6 2 , 7 1 ( T e x. 2000). When ERCOT’s counsel aske d M acke about his definition of a “ letter of intent,” Macke testified t hat i t was a letter ex plaining interest i n pursuing the purc hase of the prope rty

and that it was a nonbinding leg al document. ERCOT’s c ounsel furthe r inquired: Q. Right, but does this—does this—did y ou intend by sending this letter itself to be bound to a contr act to purc hase the p r o p e rt y? TH E WI TN ESS: Th a t w a s— that’ s th e int e nt. [ER COT’s counse l] : Then what do y ou mean by s ay i n g t hat it’s a nonbinding le g a l do c ume nt? A. Wel l, w hat I me an b y that is that it’ s jus t a le tte r o f i nte nt. Idon’t have a lot of the due diligenc e information in order18 to tr uly e va luate wh e the r o r n ot t hat pr op e rt

y make s se ns e on behalf of a client and so in order to determine w hether or not that—something like that would rea lly work, I would have to r ece ive a lot more a dditional infor m at i o n; howeve r, it’s the basis of a n understandingthat would lead to a purc hase a g ree ment, wh i ch would be a binding a g re e me nt.

. . . . Q. Your off ers of J anuar y 17 and F ebrua

ry 24, y ou’ve a lrea dy told us, wer e done w ith the authorization of Cherry Creek [Ma c ke ’s c lie nt]. I s th a t c or re c t? A. Ye s. Q. An d th e y we re se ri ou s o ff

e rs ? A. Ye s. Q. And they wer e made in good f

aith? A. Ye s. Q. And at the time y our intention was to pu rc hase the b u i l d i n gs
— o r t h e b u i l d i n g? A. Assuming that e very thing dur ing our

due dil ige nce pa

nned ou t, y e s.

. . . . Q. Did Mr. Yanc y ever inform y ou in writing that he found this letter of intent ac cepta ble? A. No. Q
. D i d h e e v e r t e l l yo ut h a to r a l l y? A. No t th a t I re c a ll.19 Yanc y ’s testimony

in response to questioning by ERCOT’s counsel e choed Ma cke’ s
un de rs tand ingof

the le tte r o f i nte nt a s n on

bin din g and

c ha ra c te ri zed the us e of su c h le tte rs a s ty

pic a l: Q. Was the Macke proposal, in fa ct, ac cepta ble to Met Center? A. Ye s.

. . . . Q. All rig ht. So y ou sent this [l etter] to Reliability Council and y ou said, “The re’ s somebody

who’s ac tually

out there w i l l i n g to buy

the prope rty

at this price of $6 ,8 85 ,0 00
. Th e y ’r e wi lli ng to be bo un d to that pr ic e .” Th a t’ s w hy y ou se nt i t to u s, isn ’t

it? A. Yes, that’s—this i s t y p ical in re al estate transac tions of this si ze. Ty pically , a third-par t [y ] buy er w ill send a letter of intent so the parties will ag ree to the su bs tanti ve te rm s o f the a g re e me nt to b e fo llo we d im me diate ly by —te rm s in to a c on tr a c t.

. . . . Q. Would i t surprise y ou to learn that M r. Macke testified . . . that he did not c on sid e r t his to b e a

bin din g of

fe r a t a ll? A. No , b ec au s e th at ’s n o t h o w t ra n s ac t i o n s o f th i s n at u re ar e ha n d l ed , i n l a rge c o m m e r c i a l r e a l e s t a t e t r an s a c t i o n s . W h a t w a s d o n e w a s n o r m a l an d c u s t o m ar y, wh ic h is, one sid e pr e se nts a le tte r of int e nt to the oth e r s ide wh ic h s e ts f or th a ll the su b s t an t i v e t e r

m s o r t o r e a c h a g r e e m e n t o n t h a t , t o f o l l o w f r o m t h a t a purcha se ag ree ment is ex ecute d and the tran s ac t i on is consummated. That’s why this lan gu age d o es n’t say if we r ece ive a bona

fide c ontrac t. I t’s if we rec eive a bona fide offe r. Throug h Noel’s testimony , ERCOT asserte d that Macke ’s l etter w as intended to be
n o nb i n d i n g:20

Q. What w a s it

a bo ut th is Ma c ke Com

pa ny le tte r t hat c a us e d y ou to g ive it l itt le cre dence ? A. Well, . . . it say s, “We understa nd that we a

re submitt ing this off

er in a back- up position.” There wer e many cave ats . . . with respe ct t o all the things he wanted to d o b e fo re , in my vi ew, he off e re d n oth ingbin din g . A nd the fa c t th a t it expired four da

y s after it was prese nted to us sug g ested to me t hat i t was—it was descr ibed as a letter of intent. And I ’ve seen letters of i ntent used many , many way s in my e xp e r ie n c e . T h e y ’ r e a ls o c a ll e d le tt e r s o f in te r e s t. T h e y ’re not binding. The y

don ’t h av e an y

impact. That’s the way , in my experience , they ’ve a lway s been ha

ndled. So I just saw thi s as, frankly , a fa irly transpar ent attempt to establish a number that frankly was highe r t h an any

number I had ever hear d expressed.
Review of the rec ord shows that, althoug h Macke testified that his letter of intent wa s nonbinding, ther e wa s testimony that his le t t er was a se rious offe r made in good f aith and that he intended to pur chase the building as long as the due diligenc e investiga tion “panned out.” Macke
and Ya nc y tes tif ie d th a t du e dil ig e nc e c on dit ion s a re ty pic a lly inc lud e d in

re a l e state purc ha se
a g re e me nts . Jur or s are the so le jud g e s o f t he wi tne sse s’ c re dib ili ty

and the we ig ht to b e g ive n th e ir testimony
. City of Keller v. W ilson , 2005 Tex. L EXI S 436, at *39 (Tex. J une 10, 2005). Revie wing courts ca nnot impose their own opinions to the contrar y . Id
. I n this case, afte r consideringall the evidenc e, we cannot sa y that the jury ’s answe r to Question No. 12 is so contrar y to the overw helming weight and pr eponder ance of the e vidence as to be c lear ly

wrongand manife stly

unjust. According ly , we c o n clude that the evidence was fac tually sufficie nt to support the findi ng of a bona fide offe r t hat was acc eptable to Met Center, a nd
we ove rrule E RCOT’s second issue.21

The Lease’s Right of First Refusal Versus the Exercise d Purc hase Option ERCOT ne x t asserts that the r ight of first ref usal should not take pre cede nce ove r the exercised pur chase option. See Sinc lair Refining Co. v. Allbritton , 2 1 8 S. W. 2 d 1 8 5 , 1 8 8

- 8 9 ( T e x. 1949). A rig ht of first re fusal, also known a s a pree mptive or pref ere ntial r ight, empower s its holder with a pre fer ential rig ht to purchase the subject prope rty on the same te rms offe red by or to a bona fide purc haser
. Tenneco, Inc. v. Enterprise Prods. Co. , 925 S.W .2d 640, 644 (Tex. 1996). Such a rig ht is dist inct from a purcha se option, whic h g ives the holder the rig ht to purchase at its election wi t h i n an agr ee d period at a named pr ice. Allbritt on , 2 1 8 S. W. 2 d a t 1 8 8
. I f th e p r ic e is to b e the marke t value of the premises at the time the option is ex erc ised, then no price is specified. Id
.

Be cause neither party

in this case cla imed that the lease was ambiguous, we may construe it as a matter of law. MCI Telec omms. Corp. v. Texas Utils. Elec. Co. , 995 S.W .2d 647, 65 0- 51 (T e x. 19 99 ). We re vie w the dis tr ic t c ourt ’s legal con clu sio ns de novo
. Id
. a t6 5 1
. In
con s t ru i n g a l ease, we a scer tain and g ive ef

fec t to the parties’ intentions as e x presse d in the document. Frost Nat’l Bank v. L& F Distribs., L td. , 1 65 S.W
. 3 d 3 1 0 , 3 1 1

- 1 2 ( T e x. 2 0 0 5 )
. We consider the entire writing and attempt to harmonize and give effe ct t o all its provisions by analy zing them with refe renc e to the whole a g reement. Id . at 312. Our c onstruction is “from a utilit aria n standpoint be aring in mind the pa rticular busine ss activity

soug ht to be serve d” and “ will avoid when possible and prope r a c onstruction which is unrea sonable, inequitable, and oppre ssive.” Id . (citing Re ill y v. Range rs Mgmt., Inc ., 727 S.W .2d 527, 530 (Tex. 1987)).

B y its te rm s, the le a se be tw e e n M e t Ce nte r a nd ERC OT pr ior iti zed

the ri g ht o f f

ir st
re fusal ov e r t

he purc ha se op tio n. Para g ra ph2( c )( i) state s th a t th e ri g ht o f f ir st r e fu sa l ma

y a pp ly22

notwithstanding the p u rc h as e option provisions and that the purc hase option will terminate whe n Met Center de livers notice of a third par

ty ’s bona f

ide offe r to ERCOT (“Upon de liv er y o f such
no tic e to T e na

nt, Te na nt’ s r ig ht t o p ur c ha se the pr op e rt y purs ua nt to para g ra

ph(b ) a bo ve sh a ll c e a se
and te rm inate .” ). Sig nif

ic antl y , th e ri g ht o f f

ir st r e fu sa l do e s n ot m e re ly state tha t a do rm ant right to exe rcise the purc hase option shall ce ase a nd terminate w ith the delivery of the bona

fide off er
no tic e; it s ta te s th a t up on de liv e ry of su c h n oti c e the Te na

nt’ s “ rig ht to p ur c ha se ” the pr op e rt y pursuant to the purc hase option shall ce ase a nd terminate. I n c o ntrast to the rig ht of first re fusal, the mar ket-pric e purc hase option in section 2(b) la c ks any langua g e pr ior iti zing it ov e r ano the r le a se pr ov isi on . A dd iti on a lly , n on e of the le a se s in the a uth or ity that ERC OT c ite s inv olv e d a mark e t- pr ic e op tio n wi th a ri g ht of fi rs t r e fu sa l th a t w ou ld
cause the option to “cea se and te rminate” u p o n n o t ice of a third par

ty ’s bona f

ide offe r, as in Met Center’ s lease w ith ERC OT. See , e.g. , Allbritt on , 218 S.W .2d at 186-87; Pitman v. Sanditen , 626 S.W. 2d 49 6, 49 6- 97 (T e x. 19 81 ); Tye v. A pperson , 6 89 S.W. 2d

32 0, 32 1 ( Te x. Ap p. —F or t Wor th 19 85 , wr it r e f’ d n .r .e .) ; se e als o Wanda Ellen Wakefie ld, Annotation, Construction and Eff ect of Option s to Purchase at Spec ified Price and at Price O ffered by Third Person, Inc luded in Same Instrument , 22 A.L .R.4th 1293 (2004).

Th e re wa s e vid e nc e that the pa rt ie s we re re pr e se nte d by c ouns e l in the ir lease
ne g oti a tio ns . We de te rm ine the int e nt o f t he pa rt ie s f ro m w hat th e y

a c tua lly e xpre sse d in

the le a se
a s wr itt e n, no t w hat th e y

may have int e nd e d b ut f

a ile d to e xpre ss. Heritage Res. v. Nationsbank , 939 S.W .2d 118, 130 (Tex. 1996). As a rule, parties have the rig ht to contra ct as they see f it as long a s23

t h ei r agr eeme nt does not violate the law or public policy
. I

n r e P r u d e n ti a l I n s . Co

. of Am. , 148 S.W .3d 124, 129 & n.11 ( Tex. 2004).

Given the ter

ms of the rig ht of first re fusal in t he lea se and the jury ’s af firmative finding on the bona f

ide offe r question, t he dis trict court did not err in declar ing that ERCOT’s rig ht to b uy B uil din g Th re e un de r t

he purc has e op tio n c e a se d, no tw ith sta nd ingits e ff

or t to e xer c ise its
r ig h ts u n d e r

p ar a g r a p h 2 ( b ) , w h e nM e t C e n te r d e live red n o ti c e o f

M a c k e ’ s o f

f e r to E RC O T
. We
overr ule ERCOT’s third issue. Jury’s F ind ing that Met C enterRepudiated the P urchase Option is Im m ater ial

I n its f ina l is su e , E RCO T a

rgue s th a t Me t Ce nte r c ou ld n ot i nv ok e the ri g ht o f f ir st
re fu s al beca

use the jury

found that Met Center

repudiated the purc hase option by (i) deny ing that ERCOT was e n titled to any cre dit ag ainst the purcha se price of the prope rty based on te nant improvements and ( ii) denying that the purcha se option was oper ative.

Repudiation consists of words or actions by a contra cting party indicating that t he party is not g oing to perf

orm in the future. SAVA Gumarsk a in Kemijska Industria D.D. v. Adv anced Polyme r Scis., Inc. , 128 S.W .3d 304, 315 (Tex. App.—Dallas 2004, no pe t.)
. I t i s co n d uct that
s h o w s a f ixe d in te n ti o n to a

b an d o n , r e n o u n c e , an d r e f u s e to p e r f

o r m th e c o n tr a c t. Id
. E R C OT
argue s th a t Me t Ce nte r’ s r e pu diatio n of the purc ha se op tio n amo un te d to a br e a c h o f t

he e nti re le a se and that Met Center

was no long er in a

position t o invoke the rig ht of first re fusal and c ompel ERCOT’s compliance with that provision. See M urray v. Crest Constr., Inc ., 900 S.W .2d 342, 344 (Tex. 1995). Met Center counters that the j ury ’s findi ng s that Met Center repudiated the lease a re24

rende red immater ial by

the dist ri ct co u rt ’s ruling as a matter of law that the rig ht of first re fusal trumped the purc hase option.

A question is immater ial when it should not ha ve been submitt ed; when it calls for
a fi nd ingbe y on d the pr ov inc e of the jur y , s uc h a s a

qu e sti on of law; or wh e n it wa s p ro pe rl y
s u b m i t ted but has bee n rende red immater ial by other finding s. S

o u th e a s te rn P ip e Li n e Co . v. Tichacek, 997 S.W .2d 1 6 6 , 172 (Tex. 1999). A trial cour t may disreg ard the jury ’s finding on im mate r ia l i s s u e s an d

r e n d e r ju d g me n t b a s e d

u p o nth e r e ma in in g f

in d in g s. Great Am. Prods. v

. P er ma bond Int’l , 9 4 S. W.3 d 6 75 , 6 82 (T e x. Ap p. —A us tin 20 02 , p e t. d e nie d) ; s e e a l s o C &R Tra ns po rt, In c . v . Ca mp be ll , 406 S.W .2d 191, 194 (Tex. 1966)
. Her e, the court considere d the jury ’s finding of a bona fide offe r and corr ectly deter mined that Met Center’ s notice to E RCOT of Macke ’s bona fide offe r to purcha se B uilding Thre e trumped ERCOT’s exercised pur chase option based on the terms of the rig ht of first re fusal in their building ’s leas e. Thus, the jury ’s finding s that Met Center r epudiated the lease wer e rendere d immaterial by the district court’s de clar ation that the rig ht of first re fusal trumped the purcha se option. We overrule ERCOT’s fourth point of er ror.
CO NC LU SION We have c oncluded that ( i) ERCOT waived any issue on the bona f ide offe r question, a mix ed question of law

and fa ct, by failing to obje ct to the submission of the question during the char g e conf

ere nce, ( ii) the evidenc e wa s fac tually sufficie nt to support the finding of a bona f ide of fe r, (i ii) the langua g e of

the pa rt ie s’ le a se e xpre sse d the ir int e nt that the ri g ht o f f ir st r e fu sa l tr

ump the purc hase option, and ( iv) the jury ’s finding s of Met Center ’s re pudiation were rende red immaterial by

the cour t’s decla ration that the rig ht of first re fusal trumped the purcha se option.25

Be cause the cour

t did not err in decla

ring that Met Center’ s notice to ERCOT of Macke’s bona fide of fe r t o p ur c ha se B uil din g Th re e tr ump e d ERC OT ’s e xer c ise d purc ha se op tio n ba se d on the te rm s of the ri g ht o f f

ir st r e fu sa l in

the ir bu ild ing ’s le a se , w e a ff

ir m th e jud g me nt o f t

he dis tr ic t c ourt
.

J an P. Patterson, J ustice Be fore Chief J ustice L aw, Justi ces Patter son and Pury ear Affir med Filed: September

22, 2005