Court Opinion

ID: 3128662
Source: CourtListenerOpinion
Date Created: 2015-10-16 16:03:57.279263+00
Date Added: 2024-06-11T07:38:27.118279
License: Public Domain

Opinion issued March 31,
2011

In The
Court of Appeals
For The
First District
of Texas
————————————
NO. 01-09-00203-CV
———————————
Mark Carpenter and CARPCO
Efficient Energy, L.L.C., Appellants
 
V.
Chris Phelps and Steve Helms, Appellees

 

 
On Appeal from the 188th District
Court
Gregg County, Texas

Trial Court Case No. 2007‑164‑A
 

 
 
O P I N I O N
          The issue posed here is whether documents
that recite a description of real property as Texas Railroad Commission “Oil
Lse/Gas ID no. 08294” and “the M.T. Cole ‘A’ Lease in Gregg County, Texas” are
sufficient to satisfy the statute of frauds.[1]  We hold that because the pertinent documents
do not furnish within themselves, or by reference to other existing writings,
the means or data by which the land may be identified with reasonable
certainty, the statute of frauds is not satisfied, and we reverse.[2]

Background
          This dispute arises out of a business transaction between
appellant Mark Carpenter and investors that included appellees Chris Phelps and
Steve Helms.  Carpenter is the sole
member of appellant Carpco Efficient Energy, L.L.C., which, in 2004, acquired
an oil lease in Gregg County encompassing as many as 48 wells (the M.T. Cole
“A” lease).  Carpenter and Carpco sought $80,000
in capital to develop the lease.  It is
undisputed that Helms and Phelps originally invested $30,000.00 and $10,000.00,
respectively.
          No formal joint venture agreement or joint operating
agreement was executed by the parties before the lease was put into production
and began to generate income.  Rather, the
parties exchanged numerous e‑mails, which Phelps and Helms argue form an
enforceable contract.  Helms and Phelps
sued Carpenter and Carpco in 2007, alleging in part a breach of contract and
breach of fiduciary duty.
          The fundamental disagreement between the parties is whether
Carpenter and Carpco were merely seeking to raise an initial capital amount for
the first of three planned phases of development of the M.T. Cole “A” lease
(“Phase 1”), thus limiting Phelps’s and Helms’s investments to only a portion
of the lease, or whether there was an enforceable contract for Phelps’s and
Helms’s investment in the entire lease.  Carpenter’s
testimony was that he only raised $72,000.00 for Phase 1 of the planned
development.
          After a bench trial, the court determined there was an
enforceable contract and found that the material terms were as follows:
○  Plaintiffs would invest, with other investors,
in a working interest in the M.T. Cole “A” Lease and associated oil wells;
○  Plaintiffs would share, with
other investors, in a pro rata ownership of one hundred percent ( (100%)) of
the M.T. Cole “A” Lease until net revenues from the wells equaled the principal
and interest due to the investors (“payout”);
○  Defendants would pay Plaintiffs
eight percent (8%) interest on their investment until payout occurred;
○  Plaintiffs’ would share a
diluted pro rata ownership of fifty percent (50%) of the M.T. Cole “A” Lease after
payout; and
○  Defendants would deliver a
joint operating agreement (JOA) to Plaintiffs showing their and other investors
ownership interest in the M.T. Cole “A” Lease as well as containing the other terms of operating
the M.T. Cole “A” Lease.
 
Based on these findings, the
trial court rendered judgment against Carpenter and Carpco: (1) that Phelps
recover actual damages of $80,493.74, along with pre‑ and postjudgment
interest and $100,276.94 in attorney’s fees; (2) that Phelps receive an
11.25% working interest in the M.T. Cole “A” lease; (3) that Helms recover
actual damages of $132,378.44 (plus pre‑ and postjudgment interest) and
$167,128.07 in attorney’s fees; (4) that Phelps receive an 18.75% working
interest in the M.T. Cole “A” lease; and (5) that the parties enter into a
“AAPL Form 610‑1989 Joint Operating Agreement.”
          On appeal, Phelps and Helms cite to the following
statements in a letter and other e‑mails to support the trial court’s
findings regarding the material terms of the alleged contract:
          Carpenter to Phelps, January 13, 2005:
Carpco Efficient Energy,
Co., LLC is looking for investors to invest in the M.T. Cole “A” lease in Gregg
County, Texas.  The field consists of 48
wells drilled to approximately 3,000 feet into the Woodbine formation.
. . . .
. . . Ideally, I would like
to sell a 1/3 interest for $80,000 with interest payable @ 8% on the principal
until the original investment is returned plus interest at which time the
investors stake is converted into a 1/6 carried interest. 
          
          Carpenter to Phelps, January 18, 2005:
Ross asked me the same
question about royalty or working interest. 
Royalty interest is usually associated with existing production.  My deal will require a workover program
before a level of production can be established and defined.  Therefore the interest would be a working
interest.
. . . .
. . . This is why I am
confident that all investors will get their original investment back in less
than two years and I will end up with my share of the production.  The way the deal is structured I don’t get my
carried interest until APO (after payout).
 
          Carpenter to Phelps, January 18, 2005:
Have you received any
feedback from Steve in Chicago?  I need
to get the Joint Operating Agreement finalized before the other investors make
their capital contributions.  The JOA
spells out the percentages of all involved and cannot be completed until everyone
and their interest is listed. 
 
          Carpenter to Phelps,
January 29, 2005:
 
I got an e‑mail this
morning from one of the investors in the East Texas oil deal wanting to know
what the hold up was with the JOA.  I
told him to complete the JOA and begin producing the field I need to know who
was in and their percentages.
 
Analysis
A. Statute of frauds
          In its second issue, Carpenter and Carpco contend the trial
court erred in concluding that the alleged contract satisfies the statute of
frauds because it “furnished within itself the means or data by which property,
the M. T. Cole ‘A’ Lease, in Gregg County, Texas, may be identified with
reasonable certainty” and “describes the property and contains sufficient data
such that a party familiar with the locality can identify the property with
reasonable certainty.”  See Tex.
Bus & Com. Ann. § 26.01 (West
2009) (statute of frauds).  Carpenter and
Carpco further contend the trial court erred in concluding that the contract
was partially performed and that promissory estoppel bars the application of
the statute of frauds.
          The trial court found that the alleged contract provided
that Phelps and Helms would initially share in a pro rata ownership of 100% of
the M.T. Cole “A” lease until net revenues from the wells equaled the principal
and interest due the investors, after which Phelps and Helms would share in a
pro rata ownership of 50%.  On appeal,
the parties do not dispute that an agreement assigning such real property interests
must contain a description of the property in order to satisfy the statute of
frauds.  See Westland Oil Dev. Corp.
v. Gulf Oil Corp., 637 S.W.2d 903, 908 (Tex. 1982) (holding assignment of
oil and gas lease is subject to Business and Commerce Code section 26.01); Morrow v. Shotwell, 477 S.W.2d 538, 539
(Tex. 1972) (same).  The initial question
is whether the description of the property is sufficient.
          Phelps and Helms argue the following serves as an adequate
description: (1) references in the initial “pitch package” to “the M.T.
Cole ‘A’ lease in Gregg County, Texas” in a field that consists of “48 wells
drilled to approximately 3,000 feet into the Woodbine formation”; (2) a 2004
document Carpenter filed with the Texas Railroad Commission that lists “08294”
as the “Oil Lse/Gas ID no.” for a lease described as “Cole, M.T.”; (3) an
assignment and bill of sale of the “M. T. Cole ‘A’ lease”; and (4) two drawings
entitled “East Texas Well Location Map Lease Area 1 and 2,” neither of which
contains any description of a location other than “East Texas.”
          To satisfy the statute of frauds, a writing must furnish
within itself, or by reference to some other existing writing, the means or
data by which the land may be identified with reasonable certainty.  Morrow,
477 S.W.2d at 539.  The Texas Supreme Court
has acknowledged that Texas employs a strict application of the statute of
frauds for interests in land, but nonetheless allows for a liberal construction
of the words describing the land.  Gates v. Asher, 280 S.W.2d 247, 248
(Tex. 1955).  Parol evidence may be
admitted to explain the descriptive words and to identify the land where the
instrument contains the “nucleus” of the description.  Id.
          Gates concerned
the sufficiency of the following description of land:
          All that certain land, property and premises located and
being situate in the City and County of Galveston, Texas, and commonly known,
designated and described as:
          All of Lots Number Ten (10), Eleven (11) and Twelve (12) in
Block One Hundred Seventy-five (175), in Denver Resurvey No. 2, together with
all improvements, appurtenances and hereditaments thereunto in anywise
belonging or appertaining.
 
Id. at
248.  Because there was no “Denver
Resurvey No. 2,” this Court held that no parol evidence could be admitted to
resolve the erroneous description.  See Asher
v. Gates, 272 S.W.2d 585, 589–90 (Tex. Civ. App.—Galveston 1954), rev’d, 280 S.W.2d 248 (Tex. 1955).  The supreme court reversed, holding that
parol evidence was admissible to show that the land could be identified as “Lots
Nos. 10, 11 and 12, original Block
175, Block No. 2 Denver Resurvey.”  Gates,
280 S.W.2d at 249 (emphasis added).
          There
was testimony at trial from Bryan Maxey, a petroleum landman, that, based on
the documents previously discussed, he could obtain a list of the wells and physically
locate them based on an Internet search using the “lease number.”  Maxey further testified that he would have no
difficulty in identifying the specific property.  Maxey, however, did not offer a legal
description of the M. T. Cole “A” lease, either by metes and bounds or by reference
to any documents in the Gregg County real property records that contained a
legal description.  Furthermore, the
appellate record does not establish that Maxey actually located the lease.
          Phelps
and Helms suggest that Maxey’s testimony satisfies the test in Gates v. Asher.  We disagree. 
Gates allows parol evidence
when there is a “nucleus” of the property’s description.  Here, the “pitch package,” the Railroad
Commission filing, the assignment and bill of sale, and the two drawings only
describe land somewhere in Gregg County. 
Phelps and Helms do not cite to any authority that the reference to a
Railroad Commission lease number can serve as the basis for a legal
description.  Even if a Railroad
Commission lease number were a “nucleus” of the property’s description, there
is no evidence in the appellate record of the property’s legal description or
even evidence that Maxey, in fact, actually found the property.  See
Westland Oil Dev. Corp., 637 S.W.2d
at 909 (holding that words which expressly refer to adequate legal description
provide “nucleus” of description that is legally sufficient for statute of
frauds); Wilson v. Fisher, 188 S.W.2d
150, 152 (Tex. 1945) (“[R]esort to extrinsic evidence, where proper at all, is
not for the purpose of supplying the location or description of the land, but
only for the purpose of identifying it with reasonable certainty from the data
in the memorandum.”).
Partial performance
          The
trial court held in the alternative that the alleged contract was partially
performed, and Phelps and Helms argue that this precludes the application of
the statute of frauds.  Satisfaction of the
“partial performance” exception, so as to remove the alleged contract from the
statute of frauds, requires the following elements be established: (1) payment
of consideration by the vendee/lessee in either money or services; (2) possession
of the property by the vendee/lessee; and (3) permanent and valuable
improvements to the property by the vendee/lessee, or the presence of such
facts as would make the transaction a fraud upon the vendee/lessee if not
enforced.  Hooks v. Bridgewater, 229 S.W. 1114, 1116 (Tex. 1921); Swineheart v.Stubbeman, McRae, Sealy,
Laughlin & Browder, Inc., 48 S.W.3d 865, 882–83 (Tex. App.—Houston [14th
Dist.] 2001, pet. denied).  Each of these
elements is indispensable.  Swineheart, 48 S.W.3d at 883.
          Because
Phelps and Helms neither show nor argue that they took possession, their
reliance upon the doctrine of partial performance to avoid application of the
statute of frauds fails.  See id.
at 883.
Promissory estoppel
          The
trial court also alternatively held that the doctrine of promissory estoppel
bars the application of the statute of frauds because Carpenter and Carpco
promised to execute assignments and joint operating agreements that satisfied
the statute of frauds.  For promissory
estoppel to create an exception to the statute of frauds requires a promise to
sign a prepared written contract which would satisfy the requirements of the
statute of frauds.  Beta Drilling, Inc. v. Durkee, 821 S.W.2d 739, 741 (Tex.
App.—Houston [14th Dist.] 1992, writ denied) (citing Nagle v. Nagle, 633 S.W.2d 796, 800 (Tex. 1982)).  A promise to prepare the written contract is
not sufficient.  Beta Drilling, Inc., 821 S.W.2d at 741.  The defendant must have promised to sign a
particular existing written agreement.  Id. (citing Southmark Corp. v. Life Investors, Inc., 851 F.2d 763, 766 (5th
Cir. 1988) (applying Texas law)).
          Here
the trial court explicitly found that the parties agreed “to negotiate the
terms of the Joint Operating Agreement in good faith,” but further acknowledged
that the agreement had yet to be drafted.  As such, no existing written agreement containing
a legal description of the lease that Phelps and Helms could have promised to sign. 
We hold, therefore, that promissory estoppel is no bar to the statute of
frauds under these facts.
          Accordingly, we sustain issue two and hold that the statute
of frauds applies and that any agreement between the parties concerning the M.T. Cole
“A” lease is not enforceable. 
See Tex. Bus. & Com. Ann. § 26.01 (West 2009).
B. Contract
          In the alternative, Carpenter and Carpco contend that even were
there an adequate description of the M.T. Cole “A” lease, there is legally and
factually insufficient evidence of a contract. 
Our legal‑sufficiency review must consider the evidence
in the light most favorable to the fact-finder’s decision and indulge every
reasonable inference in support of that decision.  See
City of Keller v. Wilson, 168 S.W.3d 802, 822 (Tex. 2005).  If the party attacking the legal sufficiency
had the burden of proof on that issue, it must demonstrate that the evidence
establishes all vital facts in support of that issue as a matter of law.  Dow Chem. Co. v. Francis, 46 S.W.3d
237, 241 (Tex. 2001).  Our review must
first search the record for evidence that supports the finding and disregard
all evidence to the contrary.  Id.  Absent evidence supportive of the finding, we
then examine the entire record to determine if the contrary proposition was
established as a matter of law and, if established conclusively, the issue must
be sustained.  Id. at 241–42.  In reviewing a challenge to the factual sufficiency of
the evidence, we must consider and weigh all the evidence and should set aside
the judgment only if it is so contrary to the overwhelming weight of the
evidence as to be clearly wrong and unjust. 
Ortiz v. Jones,
917 S.W.2d 770, 772 (Tex. 1996) (citing Cain v. Bain, 709 S.W.2d 175, 176 (Tex. 1986)); Arias
v. Brookstone, L.P., 265
S.W.3d 459, 468 (Tex. App.—Houston [1st Dist.] 2007, pet. denied).
          Carpenter and Carpco allege there is no evidence in the e‑mails
or any other writing of the trial court’s finding that “Plaintiffs would share,
with other investors, in a pro rata ownership of one hundred percent ( (100%))
of the M.T. Cole ‘A’ Lease until net revenues from the wells equaled the
principal and interest due to the investors (‘payout’).”  The January 13, 2005 letter affirmatively
supports Carpenter and Carpco’s argument that the investors were only offered
ownership in Phase 1:
Carpco Efficient Energy,
Co., LLC is looking for investors to invest in the M.T. Cole “A” lease in Gregg
County, Texas.  The field consists of 48
wells drilled to approximately 3,000 feet into the Woodbine formation.
. . . .
. . . Ideally, I would like
to sell a 1/3 interest for $80,000
with interest payable @ 8% on the principal until the original investment is
returned plus interest at which time the investors stake is converted into a
1/6 carried interest. 
          
(Emphasis added.)
 
          While we agree that a review of the record demonstrates no
evidence in e‑mails or other writing that the investors were offered a
pro rata interest, Carpenter testified:
          [Counsel for Phelps and Helms] Now, in the e‑mails
and in all the testimony so far, you offered them a pro‑rata ownership of
100 percent of the M.T. Cole “A” Lease until after payout.
          [Carpenter] A.  Which then after payout - - after payback and
payout, they would be diluted by 50 percent?
          Q.  Yes.
          A.  I agree with that.
          . . . .
          [Counsel for Phelps and Helms] Q.  Mr. Carpenter, when - -
before we took a break for lunch, we were discussing some of the points that we
have disagreement on.  One of those
points is you contend that Carpco Efficient Energy L.L.C. owned 100 percent of
the working interest of the M.T. Cole “A” Lease, and then you were going to
assign out percentages based on the amount of the money that you raised; is
that correct?
          [Carpenter] A.  No, sir. 
I said that Carpco acquired the lease back in December, way before any
of the money was received on March 1st and after.  So before March 1st, Carpco owned 100 percent
of the M.T. Cole “A” Lease.
          Q.  Okay. 
And you contend that you raised $72,000, right?
          A.  Well, I tried to raise $240,000 in three
phases.  I tried to raise $240,000. . .
.  But I only raised $72,000 for Phase 1.
          Q.  Okay. 
And based on the capital raise of $72,000, you contend that the
Plaintiffs and other investors are entitled to a pro‑rata share over 80,
right instead of 72?  This --
          A.  By pro rata, I’m -- that’s a confusing term
to me.
          Q.  Okay
          A.  The percentages -- I can deal with
percentages.
          Q.  What percentage was Mr. Phelps to have after
payout?
          A.  After he got his money back, he had the
option to acquire 6 1/4 percent of Phase 1 -- of Phase 1.
          Q.  Okay. 
And you’re basing that number – because you’re putting his investment as
a fraction over 80, and while the Plaintiffs, they’re putting their investment
as a fraction of over 72; is that correct?
          A.  Yes, sir.
          Q.  So that’s a point of difference that we have
in this lawsuit; is that correct?
          A.  We definitely disagree on that.
 
          Phelps and Helms argue that Carpenter’s initial answer, “I
agree with that,” is an admission that is legally sufficient to support the
trial court’s finding that “Plaintiffs would share, with other investors, in a
pro rata ownership of one hundred percent ( (100%)) of the M.T. Cole ‘A’
Lease.”  We do not agree this constitutes
an admission.  City of Keller reminds us that we do not literally look “only at
that evidence that tends to support the judgment.”  168 S.W.3d at 827.  We must go further and determine whether the
evidence could be considered by a reasonable factfinder.  Id.
          Carpenter’s testimony, placed in context, concurred only with
the statement, “Which then after payout - - after payback and payout, they
would be diluted by 50 percent?”  While
it can be inferred that he agreed with the statement, “you offered them a pro‑rata
ownership of 100 percent of the M.T. Cole “A” Lease,” his later testimony on
direct was that he was confused by the term “pro rata.”  Carpenter also testified that Carpco
initially owned 100% of the lease and that he was seeking investments only in
Phase 1 of the lease.  Considering the
context of Carpenter’s testimony in light of the entire direct examination by
Phelps and Helms’s lawyer, a reasonable factfinder could not find that
Carpenter testified he offered the investors a pro rata ownership of one
hundred percent of the lease.
          Accordingly, we hold that even were there an adequate
description of the M.T. Cole “A” lease, the evidence is legally insufficient to
establish a necessary term of that contract, and we sustain issue one.
C. Partnership
          In their third issue, Carpenter and Carpco contend the
trial court erred in concluding that they were in a partnership with Phelps and
Helms concerning the M.T. Cole “A” lease under the provisions of the former
Texas Revised Partnership Act[3]
and challenge the legal and factual sufficiency of the evidence to support the
creation of any such partnership.
          In Ingram v. Deere, the Texas Supreme Court
discussed the formation of a partnership under the Texas Revised Partnership Act.  288
S.W.3d 886 (Tex. 2009).  The Act requires no direct proof of the
parties’ intent to form a partnership.  Id. at 895 (citing Act § 2.02).  Rather, the Act lists the following factors:
          Factors
indicating that persons have created a partnership include their:
                   (1) receipt
or right to receive a share of profits of the business;
                   (2) expression
of an intent to be partners in the business;
                   (3) participation
or right to participate in control of the business;
                   (4) sharing
or agreeing to share:
                             (A) losses
of the business; or
                             (B) liability
for claims by third parties against the business; and
                   (5) contributing
or agreeing to contribute money or property to the business. 
 
Act § 2.03(a).  Unlike
the common law, the Act does not require proof of all of the listed factors in order for a partnership to exist.  Ingram, 288 S.W.3d at
896.
          Moreover, the
Act further sets out circumstances that do
not conclusively establish a partnership:
          One of
the following circumstances, by itself, does not indicate that a person is a
partner in the business:
                   (1) the
receipt or right to receive a share of profits:
                             (A) as
repayment of a debt, by installments or otherwise;
                             (B) as
payment of wages or other compensation to an employee or independent
contractor;
                             (C) as payment of rent;
                             (D) as
payment to a former partner, surviving spouse or representative of a deceased
or disabled partner, or transferee of a partnership interest;
                             (E) as
payment of interest or other charge on a loan, regardless of whether the amount
of payment varies with the profits of the business, and including a direct or
indirect present or future ownership interest in collateral or rights to
income, proceeds, or increase in value derived from collateral; or
                             (F) as
payment of consideration for the sale of a business or other property by
installments or otherwise;
                   (2) co‑ownership
of property, whether in the form of joint tenancy, tenancy in common, tenancy
by the entireties, joint property, community property, or part ownership, whether
combined with sharing of profits from the property;
                   (3) sharing
or having a right to share gross returns or revenues, regardless of whether the
persons sharing the gross returns or revenues have a common or joint interest
in the property from which the returns or revenues are derived; or
                   (4) ownership
of mineral property under a joint operating agreement.
 
Act § 2.03(b).
 
          In Ingram, the Texas Supreme Court stated that because section
2.03(a) factors function as a proxy for the common‑law requirement of
intent to form a partnership by identifying conduct logically suggestive of a
collaboration of a business’s purpose and resources to profit as partners, the
issue of a partnership’s existence should be decided upon consideration of all
evidence bearing on the partnership factors. 
Ingram, 288 S.W.3d at
896.  The court, therefore, while adopting
a totality-of-the-circumstances test, recognized that an absence
of any evidence of the factors will preclude recognition of a partnership under
Texas law.
          Here the alleged partnership existed
for the same reason as the alleged contract—development of the M.T. Cole “A”
lease.  Phelps and
Helms do not argue that the alleged partnership was formed for any reason other
than to share in a pro rata working‑interest ownership
of the M.T. Cole “A” lease.  The trial
court’s finding of a partnership therefore functions as an alternate ground to
support the judgment.     
          Carpenter and Carpco have both asserted the statute of
frauds and challenged the legal sufficiency of the evidence of a
partnership.  The law is clear that an
interest in real estate cannot become a partnership asset unless the agreement concerning
the property is in writing the same as any other contract concerning the sale
of land.  See Pappas v. Gounaris,
311 S.W.2d 644, 645–47 (Tex. 1958) (applying former statute of frauds[4]).  We have already determined that the statute
of frauds applies and that any agreement between the parties concerning ownership
of the M.T. Cole “A” lease is not enforceable.  See
Tex. Bus & Com. Ann. § 26.01 (West 2009).  The question remains whether the trial
court’s finding that “Plaintiffs and Defendants are partners in the M.T. Cole
‘A’ Lease” is supported by legally‑ or factually‑sufficient
evidence if the agreement concerning the lease is unenforceable.
          Absent an enforceable agreement concerning the M.T. Cole
“A” lease, we hold there is no evidence of the factors enumerated in section 2.03(a) of the Act of an intent of the
parties to create a partnership for any business purpose other than the purpose
that is unenforceable under the statute of frauds.  There is no evidence that Phelps and
Helms had a right to receive a share of profits from any business other than
the development of the M.T. Cole “A” lease and there is no evidence of a
written agreement to share any specific percentage of profits with respect to
any specific ownership interest in the lease. 
There is no evidence of an intent to be partners in anything other the development
of the field, which would require the establishment of a joint venture and a
joint operating agreement, both of which are subject to the statute of frauds.  There is no evidence of an agreement to share
in the business liabilities of the lease operations.  Indeed, there is only an agreement to
contribute money to purchase an unspecified working interest in the field that
was never reduced to writing.  Accordingly, we sustain
issue three.
C. Damages and attorney’s fees
          In their fourth and six issues, Carpenter and Carpco
challenge the award of damages and attorney’s fees.  Because the bases of liability—breach of
contract and breach of fiduciary duty by a partner—have been negated by our
previous determination of no enforceable agreement or partnership, we hold the
trial court erred in awarding damages and attorney’s fees.  See
State Farm Life Ins. Co. v. Beaston,
907 S.W.2d 430, 437 (Tex. 1995) (holding attorney’s fees not generally
recoverable unless party prevails under cause of action for which attorney’s
fees are recoverable and damages are recovered); S. Pine Lumber Co. v. Andrade, 124 S.W.2d 334, 335 (Tex. 1939)
(holding damage award immaterial when no liability).  Accordingly, we sustain issues four and six.[5]

 
Conclusion
          We
reverse the judgment of the trial court and render judgment that Phelps and
Helms take nothing.
          
 
 
 
                                                                   Jim
Sharp
                                                                   Justice

 
Panel
consists of Justices Keyes, Sharp, and Massengale.

[1]         See Tex.
Bus & Com. Ann. § 26.01 (West 2009) (statute
of frauds).
 

[2]           The
Texas Supreme Court transferred this appeal from the Court of Appeals for the
Twelfth District of Texas.  Misc. Docket
No. 08-9177 (Tex. Dec. 15, 2008); see Tex.
Gov’t Code Ann. § 73.001 (West 2005) (authorizing transfer of
cases).  We are unaware of any conflict
between precedent of the Court of Appeals for the Twelfth District and that of
this Court on any relevant issue.  See Tex.
R. App. P. 41.3.        

[3]        See Act of May
31, 1993, 73d Leg., R.S., ch. 917, § 1, 1993 Tex. Gen. Laws 3887, 3887 (Revised
Statutes art. 6132b, since
expired).

[4]        Revised
Statutes, 39th Leg., R.S., § 1, art. 3995, 1925
Tex. Rev. Stat. 2, 1084, repealed by
Act of May 25, 1967, 60th Leg., R.S., ch. 785, § 4(a), 2343, 2619.

[5]          Because of our determination on liability and damages,
we also do not reach Carpenter and
Carpco’s fifth issue challenging the trial court’s conclusion that Carpenter
and Carpco are alter egos.