Court Opinion

ID: 9748624
Source: CourtListenerOpinion
Date Created: 2023-08-27 16:08:12.982962+00
Date Added: 2024-06-11T07:25:37.769200
License: Public Domain

DAVID GAULTNEY, Justice,
dissenting.
This is a contract dispute over the validity of a lease, the amount owed under a lease, and the payment for the repairs to the building. See Sw. Bell Tel. Co. v. DeLanney, 809 S.W.2d 493, 494 (Tex.1991) (“When the only loss or damage is to the subject matter of the contract, the plaintiffs action is ordinarily on the contract.”). The parties agreed that, when one of the subtenants vacated a specific portion of the *355property, the Master Lease would no longer be in effect, and the parties would “enter into a new Master Lease.” Despite this agreement, they did not “enter into a new Master Lease.” CRMC, the tenant, continued to pay the same amount, and Celtic, the landlord, accepted the same payments. At trial, Karen Murphy, who attended certain meetings of Celtic and hospital administrators, acknowledged her handwriting on the letter agreement next to the termination-of-lease provision: “This did not happen as we thought and the Master lease and sublease were renewed.”
Celtic claims in this lawsuit that it is entitled to the amount the parties agreed would be paid if the parties had entered into a “new Master Lease.” This claim is without basis. The letter agreement on which plaintiff sued provides that Celtic would have “at leas[t] sixty (60) days, from the date the vacation starts, to obtain financing and to enter into a new Master Lease....” If the parties intended the letter agreement itself to be the new lease, the letter agreement would not have expressly provided that the parties would “enter into a new Master Lease.”
Celtic’s lawyer claimed in 2005 that CRMC was a hold-over tenant. CRMC’s in-house counsel responded by email (Exhibit 68) that the Master Lease automatically renewed on its own terms, and that the lease was “fully current, in full force and effect and there is no holdover occurring.” Celtic’s lawyer then agreed with CRMC’s analysis, as established by the attorney’s email. “Ratification occurs when a party recognizes the validity of a contract by acting under it, performing under it, or affirmatively acknowledging it.” Zieben v. Platt, 786 S.W.2d 797, 802 (Tex.App.-Houston [14th Dist.] 1990, no writ). Celtic continued to accept payments as provided under the ratified Master Lease. Celtic should not now be able to recover increases in lease payments it wishes it had been able to obtain under a “new Master Lease” that the parties never “enter[ed] into.”
The record reflects that Celtic objected during the trial to the admission of Exhibit 68 (containing the referenced email), and the trial court sustained the objection and rejected CRMC’s offer of proof.
The Court: Your objection is sustained.
[CRMC’s Counsel]: Just for the record our offer of proof is denied?
The Court: Yes.
The majority opinion indicates the email was admitted during a pre-trial hearing. Yet in this appeal, CRMC argues the email was improperly excluded, and Celtic argues the evidence was properly excluded. The parties do not dispute that the trial court excluded this email evidence when it was actually offered into evidence during the trial itself.
The offer of proof was not solely as to attorney’s fees. CRMC also offered the email as an admission concerning the issue of ratification. CRMC’s counsel summarized the offer: “We would like to make an offer of proof both in connection with the opinion about attorney’s fees and also as an admission of a party opponent which goes directly to our affirmative defense of ratification.”
The trial court erred in refusing to admit the attorney’s email during the trial. The email seems conclusive on the issue of ratification, but if not, the email was at least an admission by an agent authorized to speak for the landlord. See Tex.R. Evid. 801(e)(2)(C). Given the dispositive nature of the evidence, the evidentiary ruling by the trial court was harmful error. See Tex.R.App. P. 44.1.
The parties also dispute who is responsible for the repair costs. The parties’ con*356tract, not tort law, governs the repair dispute. See DeLanney, 809 S.W.2d at 494-95. Paragraph 6 of the contract states what the tenant is responsible for and what the landlord must repair and replace. Paragraph 12 deals with damage caused by “Casualty.” The sublease agreements also contain repair provisions.
The trial court’s errors reflect an unfair trial and “probably caused the rendition of an improper judgment.” Tex.R.App. P. 44.1. We should reverse the judgment in its entirety and remand the case for a new trial on the contract claim. Because the majority opinion affirms in part the erroneous judgment, and reverses and remands in part for a re-trial on an inapplicable tort theory of recovery, I respectfully dissent.