Court Opinion

ID: 3106031
Source: CourtListenerOpinion
Date Created: 2015-10-16 05:52:19.864399+00
Date Added: 2024-06-11T11:44:43.729287
License: Public Domain

NUMBER 13-09-00201-CV

                            COURT OF APPEALS

                  THIRTEENTH DISTRICT OF TEXAS

                     CORPUS CHRISTI—EDINBURG

RAMON LUNA, RODOLFO LUNA,                                            Appellants,
INDIVIDUALLY AND AS PARTNERS
IN LUNA BROTHERS PARTNERSHIP

                                           v.

ROBERTO LUNA,                                                        Appellee.

                 On appeal from County Court at Law No. 6
                         Hidalgo County, Texas

                         MEMORANDUM OPINION
                  Before Justices Garza, Vela, and Perkes
                  Memorandum Opinion by Justice Perkes
      Appellants Ramon Luna and Rodolfo Luna appeal from an adverse judgment

entered after a bench trial in a suit brought by Roberto Luna, appellee, for fraud, breach
of fiduciary duty, and breach of contract.1              Appellants attack the sufficiency of the

evidence to support the trial court’s award of a five-acre tract of land to appellee. By

two issues, appellants argue: (1) the trial court erred in entering a judgment granting

the five acres to appellee because the evidence conclusively established no agreement

was negotiated by the parties; and (2) the trial court’s finding of fact that the parties

negotiated the land for appellee’s exclusive benefit is against the great weight and

preponderance of the evidence. We reverse and render judgment.

I.      Factual and Procedural Background

        Luna Brothers was a farming partnership comprised of five brothers: Romulo,

Ramon, Refugio, Roberto and Rodolfo. In the 1970s, the brothers partitioned some of

the land, with each brother selecting a tract of land.                  Pursuant to this exchange,

Refugio, Ramon, and Rodolfo each received forty acres. Romulo and Roberto each

apparently received thirty-five acres, after Roberto made trades with his brothers,

including the five-acre tract at issue in this lawsuit.2 Neither the partnership agreement

nor any written agreement regarding the conveyances was admitted into evidence. The

warranty deeds for the conveyances were executed in April of 1982, a few months

before Romulo died. Roberto, Ramon, and Rodolfo were signatories to the warranty

deeds conveying the property to the respective brothers.

        On June 9, 1982, Romulo died, leaving a will giving the five-acre tract to his son,

Roy. Roy subsequently approached Roberto to see if he was interested in purchasing

        1
            Appellee’s pleading includes causes of action for fraud and breach of fiduciary duty; however, a
liberal review of the pleading’s background section may arguably support a claim for breach of contract.
Roark v. Allen, 633 S.W.2d 804, 809 (Tex. 1982). A court should uphold the petition as to a cause of
action that may be reasonably inferred from what is specifically stated, even if an element of the cause of
action is not specifically alleged. Gulf, Colo. & S.F. Ry. v. Bliss, 368 S.W.2d 594, 599 (Tex. 1963).
        2
         No evidence regarding the value of the tracts at the time of the 1970s partition or the 1982
conveyance was admitted into evidence.

                                                     2
the tract. Roy and Roberto negotiated a price and terms of payment. Roberto then told

Ramon and Rodolfo that Luna Brothers partnership was going to purchase the tract

from Roy, but he did not tell them that he intended the tract to eventually be conveyed

to him to equalize his share of the 1970s partition. On September 9, 1983, Rodolfo and

Roberto, as the independent executors of Romulo’s estate, executed a warranty deed

conveying the five-acre tract to Roy. On that same day, Roy executed a warranty deed

conveying the five-acre tract to Roberto, Ramon, and Rodolfo.3

        In 2006, the partnership ended, and but for the five acres at issue in this lawsuit,

the parties agree the remaining partnership land was divided among the remaining

partners, Roberto, Ramon, and Rodolfo. Roberto asserts the five-acre tract should be

transferred to him, whereas Ramon and Rodolfo assert the tract should be equally

divided among the three of them. Roberto bases his claim to the five-acre tract on a

general oral agreement that all of the partnership’s profits and holdings were to be

divided equally. He asserts that because he received an unequal share of property in

the 1970s partition, he is entitled to the five-acre tract.4 The trial court awarded Roberto

the five-acre tract, but declined to award any monetary amount as damages.

II.     Breach of Contract

        Appellants’ issues on appeal focus on the negotiation of an alleged agreement

regarding the five-acre tract, the sole finding of fact made by the trial court. By their first

issue on appeal, appellants assert the trial court erred in entering a judgment granting

        3
          It is undisputed on appeal that the five-acre was conveyed to the Luna Brothers partnership,
notwithstanding the absence of any reference to the partnership in the warranty deed.
        4
          Roberto did not prove the applicability of any particular equitable theory of recovery, and no
finding of fact or conclusion of law supports a finding in equity. In addition, the evidentiary record is
sparse and does not include an analysis of what specific properties went to Roberto, Ramon, and
Rodolfo, and their respective values, when the partnership ended in 2006. Rather, only a limited
discussion can be gleaned from the transcript.

                                                   3
the five acres to Roberto when the sworn testimony of the parties conclusively

established that an agreement was never negotiated by the parties. By their second

issue on appeal, appellants assert the trial court’s finding of fact that the parties

negotiated the five acres for Roberto’s exclusive benefit is against the great weight and

preponderance of the evidence. We construe these issues as challenges to the legal

and factual sufficiency of the evidence.

       A.     Standards of Review

       When we review a trial judge's findings of fact, we apply the same standards for

legal sufficiency of the evidence as we do when we review the findings of a jury.

Thomas v. McNair, 882 S.W.2d 870, 881-82 (Tex. App.—Corpus Christi 1994, no writ).

In itself, the legal sufficiency of the evidence is a question of law, not fact. City of Keller

v. Wilson, 168 S.W.3d 802, 822 (Tex. 2005). No evidence points of error must be

sustained when the record discloses one of the following: (1) evidence of a vital fact is

completely absent; (2) the court is barred by rules of law or evidence from giving weight

to the only evidence offered to prove a vital fact; (3) the evidence offered to prove a vital

fact is no more than a mere scintilla of evidence; or (4) the evidence establishes

conclusively the opposite of a vital fact. Id. at 810.

       In conducting a legal-sufficiency analysis, we review all of the evidence in the

light most favorable to the challenged finding and indulge every reasonable inference

that would support it, to determine whether there is more than a scintilla of evidence to

support the challenged finding. Id. at 822. Without acting as a trier of fact, we must

credit favorable evidence if a reasonable fact-finder could and disregard contrary

evidence unless a reasonable fact-finder could not. Id. at 827. We do not judge the

                                              4
credibility of the witnesses or the weight of their testimony. See Id. at 819. If the

evidence would enable reasonable and fair-minded people to differ in their conclusions,

then the fact-finder must be allowed to reach any conclusion that falls within the zone of

reasonable disagreement. Id. at 822. A reviewing court cannot substitute its judgment

for that of the trier-of-fact, so long as the evidence falls within this zone of reasonable

disagreement. Id.

         When reviewing a challenge to the factual sufficiency of the evidence, we

examine the entire record, considering both the evidence in favor of, and contrary to,

the challenged finding.      Cain v. Bain, 709 S.W.2d 175, 176 (Tex.1986).              After

considering and weighing all the evidence, we set aside the fact finding only if it is so

contrary to the overwhelming weight of the evidence as to be clearly wrong and unjust.

Id. Because the court of appeals is not a trier of fact, in reviewing factual sufficiency, we

may not pass upon the witnesses’ credibility or substitute our judgment for that of the

trier of fact. Maritime Overseas Corp. v. Ellis, 971 S.W.2d 402, 407 (Tex.1998). We

overturn findings only if they are so against the great weight and preponderance of the

evidence as to be clearly wrong and unjust. Ortiz v. Jones, 917 S.W.2d 770, 772 (Tex.

1996).

         The elements for a valid and binding contract are: (1) an offer; (2) acceptance in

strict compliance with the terms of the offer; (3) a meeting of the minds; (4) each party's

consent to the terms; and (5) execution and delivery of the contract with the intent that it

be mutual and binding. Hubbard v. Shankle, 138 S.W.3d 474, 481 (Tex. App.—Fort

Worth 2004, pet. denied); Labor Ready Central L.P. v. Gonzalez, 64 S.W.3d 519, 522

(Tex. App.—Corpus Christi 2001, no pet.). Consideration is also a fundamental element

                                             5
of a valid contract. Federal Sign v. Texas Southern University, 951 S.W.2d 401, 408-09

(Tex. 1997); Hubbard, 138 S.W.3d at 481. The elements of written and oral contracts

are the same and must be present for a contract to be binding. Critchfield v. Smith, 151
S.W.3d 225, 233 (Tex. App.—Tyler 2004, pet. denied); Bank of El Paso v. T.O. Stanley

Boot Co., 809 S.W.2d 279, 284 (Tex. App.—El Paso 1991), aff’d in part, rev’d in part on

other grounds, 847 S.W.2d 218 (Tex. 1992). Where an essential term is open for future

negotiation, there is no binding contact. Beal Bank, S.S.B. v. Schleider, 124 S.W.3d
640, 653 (Tex. App.—Houston [14th Dist.] 2003, pet. denied); Gerdes v. Mustang

Exploration Co., 666 S.W.2d 640, 644 (Tex. App.—Corpus Christi 1984, no writ).

      A contract for the sale of real estate must be in writing and signed by the party

charged with the promise. TEX. BUS. & COM. CODE ANN. § 26.01 (West 2009). An

exception exists when the purchaser of real estate under an oral contract: (1) pays

consideration; (2) takes possession of the property; and (3) makes permanent and

valuable improvements on the property with the consent of the seller, or, without such

improvements, other facts are shown that would make the transaction a fraud on the

purchaser if the oral contract was not enforced. Boyert v. Tauber, 834 S.W.2d 60, 63

(Tex. 1992); Pickett v. Keene, 47 S.W.3d 67, 76 (Tex. App.—Corpus Christi 2001, pet.

dism’d w.o.j.). These steps are seen as sufficient evidence of an agreement because

they provide affirmative corroboration of the agreement by both parties to the

agreement. Boyert, 834 S.W.2d at 63; Francis v. Thomas, 106 S.W.2d 257, 260-61

(Tex.1937).

                                           6
      B.     Discussion

      By his petition, Roberto appears to complain that Rodolfo and Ramon breached

the partnership agreement.     Roberto pleaded that, pursuant to an oral partnership

agreement, Roberto, Rodolfo, and Ramon were to divide any partnership profits equally

between each of them (1/3 each) (the remaining three partners), but that pursuant to an

earlier distribution between the original five brothers, Rodolfo and Ramon each received

forty acres, whereas he only received thirty-five acres.     Roberto pleaded that the

distribution was not in line with the earlier partnership agreement, and that when the

partnership later purchased the five-acre tract from Romulo’s son, Roy, it was agreed

the property was being purchased for Roberto.        In essence, Roberto argues that

pursuant to the partnership agreement, he should have received five more acres at the

time of the original distribution of property between the five brothers, and that because

he has not received the five acres from Rodolfo and Ramon, they have somehow

breached their agreement.

      The evidence presented at trial contradicts Roberto’s pleadings and fails to show

Rodolfo and Ramon breached the partnership agreement with respect to the five-acre

tract. Rather, the evidence shows the parties did not negotiate any agreement between

them regarding the five-acre tract, and there was no meeting of the minds that Roberto

was to receive the five-acres. The evidence is wholly devoid of any evidence of an offer,

acceptance, meeting of the minds, consent to the terms, or delivery of a contract with

the intent that it be mutual and binding. Further, the evidence does not show Roberto

personally took possession of the property or made permanent and valuable

                                           7
improvements to the property with the partnership’s consent, necessary factors for an

oral contract for the transfer of real property.

       Roberto testified that he personally negotiated with Roy, after Roy inherited the

property from Romulo, regarding the sale of the five-acre tract, and that he later

informed Rodolfo and Ramon about the purchase agreement. Roberto testified:

       Q.     What did you tell them? Tell the Judge.

       A.     As soon as the deal was on, “This is what we’re going to do, and
              that’s it.” They, “Okay. Let’s go for it.” I never told them that that
              five-acres were mine. We never discussed that either. We just
              said, “We’re going to buy it for Luna Brothers.”

       Q.     So your testimony is you’re not telling this Judge that you told them,
              “Those are my five-acres, and you’re paying for it.”

       A.     No, I did not. I did not say anything like that . . . I was always
              thinking of the one-third, Luna Brothers. That’s the contract we’ve
              got there.

Roberto later confirmed this testimony on multiple occasions, and further testified during

cross-examination, as follows:

       Q.     I’m going to refer you again to your sworn testimony. You recall
              that you testified under oath . . . “The honest truth, and that we
              never, ever discussed that the five-acres were going to be bought
              exclusively for me [Roberto] when Luna Brothers purchased the
              five-acres.” That was your sworn testimony last week, wasn’t it,
              sir?

       A.     Yes, sir. We never discussed that.

       Q.     And that is the honest truth. That was never discussed. Now—and
              I think you went on to testify also, didn’t you, that you never once
              had an agreement regarding that five-acres being for you. That
              was your sworn testimony last week, wasn’t it?

       A.     That was for Luna Brothers. Luna Brothers bought it.

                                               8
       Rodolfo and Ramon testified that Roberto never discussed, and they never

agreed, that the five-acre tract, which was purchased by Luna Brothers, was being

purchased exclusively for Roberto. They further testified that for more than twenty

years, Roberto never complained that the property was not in his individual name. The

1983 warranty deed shows that the property was conveyed by Roy to Roberto, Rodolfo,

and Ramon, and not to Roberto individually.

       In the event the trial court’s findings arguably contain an element of a cause of

action for breach of contract (discussed below), we hold that in addition to the absence

of a proper finding of fact on this theory of relief, the evidence does not support such a

theory of recovery. We conclude there is no evidence to show that an agreement was

negotiated between the parties regarding the five-acre tract, and there is no evidence to

support a cause of action for breach of contract. We further conclude the trial court’s

findings of fact that the parties negotiated the five-acre tract for Roberto’s exclusive

benefit is against the great weight and preponderance of the evidence.

III.   Findings of Fact and Conclusions of Law

       The Texas Rules of Civil Procedure grant a procedural right following a bench

trial to request the trial court to prepare written findings of fact and conclusions of law.

TEX. R. CIV. P. 296. The purpose of a request is to “narrow the bases of the judgment to

only a portion of the claims and defenses, thereby reducing the number of contentions

that the appellant must raise on appeal.” Liberty Mut. Fire Ins. v. Laca, 243 S.W.3d
791, 794 (Tex. App.—El Paso 2007, no pet.) (citing 6 MCDONALD & CARLSON, TEXAS

CIVIL PRACTICE § 18:3 (2d ed. 1998)); see also Vickery v. Comm’n for Lawyer Discipline,

5 S.W.3d 241, 252 (Tex. App.—Houston [14th Dist.] 1999, pet. denied).

                                             9
        After the trial court entered its judgment in favor of Roberto, Ramon and Rodolfo

timely requested findings of fact and conclusions of law. The trial court made and filed

the following findings of fact, but did not make or file any conclusions of law:

        The Court, after hearing all the witnesses and considered all the evidence
        and arguments of counsel, finds that some witnesses appeared to be less
        than truthful and with unclean hands.5

        The Court further finds that Plaintiff and Defendants negotiated the five (5)
        acre land at issue for the exclusive benefit of Robert [sic] Luna.

        No findings of fact were made regarding Roberto’s claims for fraud and breach of

fiduciary duty, or any element thereof.6 In addition, the trial court did not enter any

findings of fact that would support equitable relief. Further, mere negotiation is not an

element of breach of contract.7 At the time the trial court filed its findings of fact,

Roberto had the right to request additional or amended findings pursuant to Texas Rule

of Civil Procedure 298. See TEX. R. CIV. P. 298. Roberto, however, did not request any

additional findings of fact or conclusions of law to support his legal theories.

        5
         The doctrine of unclean hands is a defensive theory, not a claim for affirmative equitable relief.
Under this doctrine, a court may refuse to grant a plaintiff equitable relief who is guilty of “unclean hands.”
Lazy M Ranch, Ltd. v. TXI Operations, L.P., 978 S.W.2d 678, 683 (Tex. App.—Austin 1998, pet. denied);
see Thomas v. McNair, 882 S.W.2d 870, 880 n.5 (Tex. App.—Corpus Christi 1994, no writ).
        6
          The elements of a cause of action for breach of fiduciary duty are: (1) a fiduciary relationship
between the plaintiff and defendant; (2) a breach by the defendant of his fiduciary duty to the plaintiff; and
(3) an injury to the plaintiff or benefit to the defendant as a result of the defendant's breach. Dernick
Resources, Inc. v. Wilstein, 312 S.W.3d 864, 877 (Tex. App.—Houston [1st Dist.] 2009, no pet.).

        The elements of a cause of action for fraud are: (1) a material misrepresentation; (2) that was
either known to be false when made or was asserted without knowledge of its truth; (3) which was
intended to be acted upon; (4) which was relied upon; and (5) which caused injury. Dow Chem. Co. v.
Francis, 46 S.W.3d 237, 242 (Tex. 2001).
        7
          The elements of a cause of action for breach of contract action are: (1) the existence of a valid
contract; (2) performance or tendered performance by the plaintiff; (3) breach by the defendant; and (4)
damages sustained by the plaintiff as a result of the breach. Tex. Dep’t of Transp. v. Crockett, 257
S.W.3d 412, 416 (Tex. App.—Corpus Christi 2008, pet. denied).

                                                     10
       Rule 299 of the Texas Rules of Civil Procedure provides, in relevant part:

       When findings of fact are filed by the trial court they shall form the basis of
       the judgment upon all grounds of recovery . . . embraced therein. The
       judgment may not be supported upon appeal by a presumed finding upon
       any ground of recovery . . . no element of which has been included in the
       findings of fact . . . .

TEX. R. CIV. P. 299.

       A theory of recovery is deemed waived, even if it is raised by the pleadings and

evidence, if findings of fact are made and filed, but no finding is referable to such a legal

theory. Imatani v. Marmolejo, 606 S.W.2d 710, 714 (Tex. Civ. App.—Corpus Christi

1980, no writ) (plaintiff’s theory of tender was waived because, although raised by the

pleadings, plaintiff failed to request additional findings on that theory); see also Fielder

v. Abel, 680 S.W.2d 655, 656-57 (Tex. App.—Austin 1984, no writ); Home Indemnity

Company v. Muncy, 449 S.W.2d 312, 316-17 (Tex. Civ. App.—Tyler 1969, writ ref'd

n.r.e.); McKenzie v. Carte, 385 S.W.2d 520, 529 (Tex. Civ. App.—Corpus Christi 1964,

writ ref'd n.r.e.); Pinson v. Dreymala, 320 S.W.2d 152, 156 (Tex. Civ. App.—Houston

1958, writ dism’d w.o.j.).

       The trial court found that the witnesses were less than truthful and had unclean

hands, and that the parties negotiated the property for the exclusive benefit of one of

the parties. Such findings neither state a cause of action for, nor constitute elements of,

fraud, breach of fiduciary duty, or breach of contract. Accordingly, we hold Roberto’s

causes of action for fraud, breach of fiduciary duty, and breach of contract are waived.

See TEX. R. CIV. PROC. 299.

       We sustain appellants’ first and second issues.

                                             11
IV. CONCLUSION

       The judgment of the trial court is reversed.             We render judgment that the

appellee take nothing by his lawsuit against the appellants.8

                                              __________________________________
                                              GREGORY T. PERKES
                                              Justice

Dissenting Memorandum Opinion by Justice Dori Contreras Garza.

Delivered and filed the
28th day of April, 2011.

       8
          The warranty deed shows that Roberto, Ramon, and Rodolfo each own a 1/3 undivided interest
in the five acre tract.

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