Court Opinion

ID: 2781107
Source: CourtListenerOpinion
Date Created: 2015-02-23 08:16:24.942221+00
Date Added: 2024-06-11T09:32:37.524955
License: Public Domain

Fourth Court of Appeals
                                     San Antonio, Texas
                                            OPINION
                                        No. 04-14-00110-CV

                                      Mary MOCZYGEMBA,
                                            Appellant

                                             v.
                                Thomas J. MOCZYGEMBA and
                     Thomas J. MOCZYGEMBA and Harry Lee Moczygemba,
                                          Appellees

                    From the 218th Judicial District Court, Wilson County, Texas
                                Trial Court No. 12-10-0573-CVW
                            Honorable Donna S. Rayes, Judge Presiding

Opinion by:       Karen Angelini, Justice

Sitting:          Karen Angelini, Justice
                  Marialyn Barnard, Justice
                  Rebeca C. Martinez, Justice

Delivered and Filed: February 18, 2015

AFFIRMED

           Mary Moczygemba appeals the trial court’s granting of summary judgment in favor of her

sons Thomas J. Moczygemba and Harry Lee Moczygemba. According to Mary, the trial court

erred in determining that the statute of limitations barred her claims for breach of fiduciary duty.

We affirm.

                                            BACKGROUND

           Appellant Mary Moczygemba (“Mary”) is the mother of Appellees Thomas J.

Moczygemba and Harry Lee Moczygemba (“Tommy and Harry”). In addition to Tommy and
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Harry, Mary has seven other children. At the time Mary’s husband passed away in 1985, she owned

a total of 400 acres of property, including some mineral interests therein. She had 100 acres in

Wilson County that was given to her husband by his parents in 1962 and was subsequently

improved with a ranch house. She had an adjacent 58 acres that she and her husband purchased in

the 1960s. She also had another 203 acres in Wilson County that she and her husband purchased

in 1969. And, she had 51.7 acres in Karnes County that was given to her by her parents. While her

husband was alive, they had executed several oil-and-gas leases on land they owned in Wilson and

Karnes Counties. After her husband’s death, she executed several more oil-and-gas leases.

       While her husband was alive, they used their land to raise cattle. After her husband’s death,

Tommy and Harry helped Mary on the farms and helped her raise her cattle. Tommy did most of

the work related to her farm and ranch business, and Harry helped Tommy do some of the work.

Mary, in turn, allowed Harry and Tommy to run their own cattle on the land.

       In 2000, when Mary was 74 years old, she sold about 200 acres to Tommy for $40,000 and

200 acres to Harry for $40,000. In her deposition, Mary testified that she decided to sell the acreage

to her sons because her farm and ranch business was not making money and she was concerned

about the depletion of her farm account due to expenses of her farm and cattle business. After she

expressed her concerns to Tommy and Harry, they offered to buy the acreage from her. Mary

testified, “I was running out of money to run the farm. And like they said, I wouldn’t have to pay

another bill. So I thought that would be a big relief for me.” “We did it willingly together because

they were – they were helping me. They were working with me. I trusted them.” Mary testified

that she was the one who came up with the price. She suggested a price lower than market value

“because they were helping me, and they were my sons. I just thought I’ll let them have it cheaper.”

Tommy, Mary, and Harry all agreed to use Tommy Adkisson’s law office, which Mary had used

in the past to prepare her will and to probate her husband’s estate, because, as Mary testified,
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“[t]hat’s the only attorney we knew.” Mary testified that she wanted Adkisson to prepare the deeds,

but he was unable to help her. So, David Wise, an attorney in Adkisson’s office, prepared the deeds

transferring ownership from Mary to Harry and Tommy, respectively. The previous deeds were

taken from Mary’s files at her home and given to David Wise so that he would have the property

description for the deeds he was preparing. Mary then went to his law office to sign four deeds

transferring ownership to her sons. In a deed dated June 16, 2000, Mary transferred 51.7 acres in

Karnes County to Tommy for “TEN AND NO/100 DOLLARS and other valuable consideration.”

In a second deed dated August 1, 2000, Mary transferred two tracts in Wilson County (one

consisting of 79 acres and the other consisting of 124 acres) to Harry for “TEN AND NO/100

DOLLARS and other valuable consideration.” In a third deed dated December 21, 2000, Mary

transferred 58 acres in Wilson County to Tommy for “TEN AND NO/100 DOLLARS and other

valuable consideration.” Finally, in a fourth deed also dated December 21, 2000, Mary transferred

100 acres in Wilson County to Tommy for “TEN AND NO/100 DOLLARS and other valuable

consideration.”

       Mary testified that minerals were “never discussed; it was never brought up.” According

to Mary, she never said she wanted to keep her mineral interests “because I didn’t think about it.”

She testified that she thought that the minerals would remain with her. When asked why she

thought she would retain ownership of the minerals if she was selling the land to her sons, Mary

responded, “Well, I didn’t even think of it.” “They should have asked me.” “It never crossed my

mind.” Likewise, Tommy testified that he did not think about whether the new deeds prepared by

David Wise included his mother’s mineral interests. According to Tommy, it never occurred to

him either. The new deeds prepared by David Wise contained no provisions reserving any mineral

interests. Thus, under Texas law, all of the surface estates and the mineral interests owned by Mary

transferred to Tommy and Harry, respectively. See Cockrell v. Tex. Gulf Sulphur Co., 157 Tex. 10,
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299 S.W.2d 672, 675 (1956) (“[I]t is fundamental that a warranty deed will pass all of the estate

owned by the grantor at the time of the conveyance unless there are reservations or exceptions

which reduce the estate conveyed.”).

       David Wise testified in his deposition that he had no independent recollection of preparing

the deeds or meeting with Mary, Tommy, and Harry. When it was pointed out that the previous

deed relating to one of the properties granted Mary and her husband mineral rights after the

expiration of twenty-five years relating to a lease, Wise testified “the only reason” a mineral

reservation would not have been included in the new deed “would have been because Ms. [Mary]

Moczygemba said so.” “Like I said, if she would have said reserve this, reserve that, or subject to

this or that, then it would have been written down.”

       Shortly after Mary transferred the deeds to her sons Tommy and Harry, her eldest son,

Edwin, learned of Mary selling the land to his brothers Tommy and Harry. Edwin then told his

other siblings. Mary testified that Edwin was so upset that she had sold the land to Tommy and

Harry that he did not speak to her for twelve years. Mary claims in her pleadings that it was not

until late 2009 or early 2010 that she discovered she had also conveyed the mineral interests to

Tommy and Harry. In her deposition, she was adamant that Tommy and Harry should have told

her that she was conveying her mineral interest with the surface estate:

       A: They should have told me. “Mom, you want to keep half of your minerals, and
       we’ll have the other half.” Everything would have been fine. We would be –

       Q: They should have told you that? Why should they have told you that when it
       was never discussed; they never knew your intentions; they didn’t know what
       your mind was thinking? How would – why do you think that they should have
       told you something?

       A: Well, because they should have figured it out that that’s not fair that they’re
       going to get all the minerals.

       Q: Now, when they bought the land in 2000, there had never been any mineral
       production off the land, had there?
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       A: Not on that – not that area, but there was at the other place, what Harry
       bought.

       Q: And you knew that?

       A: I knew that.

       Q: In 2000, nobody knew there was going to be an Eagle Ford Shale, did they?

       A: Probably not.

       Q: Nobody knew if those minerals were ever going to have any value, did they?

       A: Yeah. But after they started leasing, they should have come, “Well, Mom,
       look. We’re going to be leasing. Let’s just share it.”

       Q: All right.

       A: Wouldn’t that have been nice?

       Mary’s daughter Rosemary Ellis testified that there was a “family meeting” in May 2012,

at which Tommy and Harry were not present, and that at that meeting, Mary “said that she did not

sell the land intentionally to them and the mineral rights at that time.” “She did not know about

those mineral rights and she did not do that on purpose.” “She said that she was running out of

money, and they approached her to buy it.” “They agreed on the price, they picked up the deeds,

went to the attorney’s office, and had them done very quickly.”

       On October 19, 2012, Mary sued Tommy and Harry for breach of fiduciary duty, alleging

that Tommy and Harry owed her an “informal” fiduciary duty arising from “their moral, domestic

and personal relationship of trust and confidence.” Mary alleged they breached their fiduciary

duties to her, “specifically their duty of loyalty and utmost good faith, duty to refrain from self-

dealing, duty to act with integrity of the strictest kind, and duty of full disclosure” “by inducing

Mary to sign the general warranty deeds in 2000, knowing that Mary did not understand the legal

impact of their deeds with regard to her mineral interest ownership.” Mary alleged Tommy and

Harry “further breached their fiduciary duty by not explaining in complete detail the ramifications
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of signing these deeds, in particular that Mary would be giving up her mineral interests.” Tommy

and Harry filed a motion for summary judgment arguing that they had no fiduciary duty to their

mother and a motion for summary judgment arguing that Mary’s claims were barred by the statute

of limitations. The trial court denied the motion for summary judgment relating to fiduciary duties,

but granted the motion for summary judgment relating to limitations. Mary appeals, arguing the

trial court erred in granting summary judgment based on limitations.

                                          STATUTE OF LIMITATIONS

         Mary brought claims for breach of fiduciary duty against Tommy and Harry. A person

bringing a claim for breach of fiduciary duty must file suit not later than four years after the day

the cause of action accrues. TEX. CIV. PRAC. & REM. CODE ANN. § 16.004(a)(5) (West 2002).

Generally, when a cause of action accrues is a question of law. Provident Life & Accident Ins. Co.

v. Knott, 128 S.W.3d 211, 221 (Tex. 2003). “[A] cause of action accrues and the statute of

limitations begins to run when facts come into existence that authorize a party to seek a judicial

remedy.” Id. “In most cases, a cause of action accrues when a wrongful act causes a legal injury,

regardless of when the plaintiff learns of that injury or if all resulting damages have yet to occur.”

Id. However, two exceptions may defer accrual of a claim: the discovery rule and the doctrine of

fraudulent concealment. Here, Mary pled the discovery rule. 1 Tommy and Harry argue the

discovery rule does not apply.

         A.       Standard of Review

         We review the trial court’s grant of summary judgment de novo. Provident, 128 S.W.3d at

215. When reviewing a summary judgment, we take as true all evidence favorable to the

1
 It is undisputed that in the absence of the discovery rule, the statute of limitations bars Mary’s breach of fiduciary
duty claims against Tommy and Harry.

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respondent, and we indulge every reasonable inference and resolve any doubts in the respondent’s

favor. Id.

        “A defendant moving for summary judgment on the affirmative defense of limitations has

the burden to conclusively establish that defense.” KPMG Peat Marwick v. Harrison Cnty. Hous.

Fin. Corp., 988 S.W.2d 746, 748 (Tex. 1999). “Thus, the defendant must (1) conclusively prove

when the cause of action accrued, and (2) negate the discovery rule, if it applies and has been

pleaded or otherwise raised, by proving as a matter of law that there is no genuine issue of material

fact about when the plaintiff discovered, or in the exercise of reasonable diligence should have

discovered the nature of its injury.” Id. Thus, if the plaintiff pleads the discovery rule as an

exception to limitations, the movant must negate that exception as well by proving as a matter of

law that either (1) the discovery rule does not apply or (2) there is no genuine issue of material fact

about when the plaintiff discovered or, in the exercise of reasonable diligence, should have

discovered the nature of the alleged injury. Howard v. Fiesta Texas Park Show, Inc., 980 S.W.2d
716, 719 (Tex. App.—San Antonio 1998, pet. denied). If the movant establishes that the statute of

limitations bars the action, the respondent must then adduce summary judgment proof raising a

fact issue in avoidance of the statute of limitations. KPMG, 988 S.W.2d at 749.

        B.     Does the discovery rule apply in this case?

        The discovery rule is “a very limited exception to statutes of limitations.” Shell Oil Co. v.

Ross, 356 S.W.3d 924, 929 (Tex. 2011) (citation omitted). It applies to instances in which the

nature of the plaintiff’s injury is “inherently undiscoverable and the evidence of injury is

objectively verifiable.” BP Am. Prod. Co. v. Marshall, 342 S.W.3d 59, 65-66 (Tex. 2011) (citation

omitted). Requiring both that a plaintiff’s injury be inherently undiscoverable and evidence of that

injury be objectively verifiable “balance the conflicting policies in statutes of limitations: the

benefits of precluding stale or spurious claims versus the risks of precluding meritorious claims
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that happen to fall outside an arbitrarily set period.” S.V. v. R.V., 933 S.W.2d 1, 6 (Tex. 1996). The

supreme court has explained that the “concern that meritorious claims will be barred is . . . taken

into account in fashioning these two elements.” Id. at 15. “The two elements strike the proper

balance between the beneficial purposes of statutes of limitations and the real concern that a

person’s rights may be cut off.” Id. The “preclusion of a legal remedy alone is not enough to justify

a judicial exception to the statute.” Id. (citation omitted). “The primary purpose of limitations, to

prevent litigation of stale or fraudulent claims, must be kept in mind.” Id. “Allowing late-filed

claims that are inherently undiscoverable while requiring objectively verifiable injury reduces the

likelihood of injustice in cutting off valid claims while affording some protection against stale and

fraudulent claims.” Id.; see Via Net v. TIG Ins. Co., 211 S.W.3d 310, 313 (Tex. 2006) (explaining

that the supreme court has “restricted the discovery rule to exceptional cases to avoid defeating the

purposes behind the limitations statutes”).

       In this case, Tommy and Harry argue that the discovery rule does not apply because (1)

Mary’s injury, the allegedly wrongful transfer of the mineral interests, was not inherently

undiscoverable, and was in fact easily discoverable if she had simply read the deeds; and (2) the

evidence of her injury is not objectively verifiable. We agree with Tommy and Harry that they

have met their summary judgment burden of showing that there is no objectively verifiable

evidence of Mary’s injury.

       The supreme court has explained that requiring evidence of the nature of an injury to be

objectively verifiable prevents fraudulent prosecutions. See S.V., 933 S.W.2d at 6. For example, in

Gaddis v. Smith, 417 S.W.2d 577, 581 (Tex. 1967), a plaintiff filed suit after the statute of

limitations had run claiming that her doctors were negligent in leaving a sponge insider her body

after surgery. “The presence of the sponge in her body–the injury–and the explanation for how it

got there–the wrongful act– were beyond dispute.” S.V., 933 S.W.2d at 7 (discussing Gaddis).
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“The facts upon which liability was asserted were demonstrated by direct, physical evidence.” Id.

       In contrast, in Robinson v. Weaver, 550 S.W.2d 18, 21 (Tex. 1977), the supreme court held

there was no objectively verifiable evidence of the plaintiff’s injury. In that case, a patient brought

a claim against his doctors for misdiagnosis of his back condition. The supreme court explained,

       Plaintiff, to prove his cause of action, faces the burden of proving both a mistake in
       professional judgment and that such mistake was negligent. Expert testimony
       would be required. Physical evidence generally is not available when the primary
       issue relevant to liability concerns correctness of past judgment. Unlike Gaddis v.
       Smith, there exists in the present case no physical evidence which in-and-of-itself
       establishes the negligence of some person. What physical evidence was to the cause
       of action alleged in Gaddis v. Smith, expert testimony is to the cause of action in
       the present case. Even the fact of injury is a matter of expert testimony.

Robinson, 550 S.W.2d at 21. The supreme court concluded that such expert testimony could not

meet the objective verification of wrong and injury necessary for application of the discovery rule.

Id.; see S.V., 933 S.W.2d at 7 (discussing Robinson).

       Similarly, in S.V., 933 S.W.2d at 3, the supreme court was faced with the issue of whether

there was objectively verifiable evidence of the plaintiff’s injury in a case where the plaintiff

alleged she had been sexually abused by her father until the age of seventeen but had repressed all

memory of the abuse until after she turned twenty. The supreme court noted that the only physical

evidence to support the plaintiff’s allegations consisted of her symptoms and, to a lesser extent,

her behavioral traits, as described by her and the experts who testified on her behalf. Id. at 15. The

supreme court explained that this evidence, however, was inconclusive because the experts

testified her symptoms could have been caused by things other than sexual abuse by her father. Id.

The court concluded there was “no physical or other evidence in this case to satisfy the element of

objective verifiability for application of the discovery rule.” Id. The court pointed to examples of

different types of evidence that it would consider objectively verifiable:

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       The kinds of evidence that would suffice would be a confession by the abuser, e.g.,
       Meiers-Post v. Schafer, 170 Mich. App. 174, 427 N.W.2d 606, 610 (1988); a
       criminal conviction, e.g. Petersen v. Bruen, 106 Nev. 271, 792 P.2d 18, 24-25
       (1990); contemporaneous records or written statements of the abuser such as diaries
       or letters; medical records of the person abused showing contemporaneous physical
       injury resulting from the abuse; photographs or recordings of the abuse; an
       objective eyewitness’s account; and the like. Such evidence would provide
       sufficient objective verification of abuse, even if it occurred years before suit was
       brought, to warrant application of the discovery rule.

S.V., 933 S.W.2d at 15.

       While Mary cites case law for the proposition that “[i]t is well-settled law that the discovery

rule applies to almost all actions involving fiduciaries,” the supreme court has explained that

bringing a breach of fiduciary duty claim does not negate the necessity of the plaintiff’s injury

being shown through objectively verifiable evidence. In S.V., the supreme court explained that

while it has “adhered to the requirement of objective verification fairly consistently in [its]

discovery rule cases,” it has “not always emphasized the requirement because the alleged injury

was indisputable.” S.V., 933 S.W.2d at 7 (emphasis added). As an example, the S.V. court cited

Willis v. Maverick, 760 S.W.2d 642 (Tex. 1988), noting that the “attorney’s error [was] apparent

in [the] divorce decree.” S.V., 933 S.W.2d at 7. The S.V. court also cited International Bankers

Life Ins. Co. v. Holloway, 368 S.W.2d 567 (Tex. 1963), which involved a corporation suing three

of its officers and directors for breach of fiduciary duty because the officers and directors sold

“their personal stock in competition with the sale of corporation stock.” Holloway, 368 S.W.2d at

579; see S.V., 933 S.W.2d at 7. The S.V. court explained that in Holloway, the objectively verifiable

evidence of the plaintiff’s injury consisted of “stock transfer records and board meeting minutes

prov[ing] officers’ and directors’ misdealing.” S.V., 933 S.W.2d at 7.

       The S.V. court also cited Slay v. Burnett Trust, 143 Tex. 621, 187 S.W.2d 377, 385-87

(1945), another fiduciary duty case involving plaintiffs suing trustees to recover alleged secret

profits received by former trustees and other defendants, and to recover damages for alleged losses
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on improper loans of trust funds. The S.V. court explained that the objectively verifiable evidence

in Slay consisted of a “paper trail detail[ing] self-dealing.” S.V., 933 S.W.2d at 7. Thus, even in

the context of a claim for breach of fiduciary duty, for the discovery rule to apply, there must be

objectively verifiable evidence of the alleged injury.

       The evidence in this case consists of deposition testimony, which is not objectively

verifiable evidence, and copies of the actual deeds showing a transfer of the mineral estate from

Mary to Tommy and Harry, respectively. While the deeds are evidence that Mary’s mineral

interests passed to her sons, they are not evidence that the mineral interests were wrongfully

transferred to her sons.

       Mary urges that this case is like Gaddis and the mere fact that her mineral interests were

transferred shows she was injured; that is, she argues that no one would have chosen to transfer

the mineral estate below market value. However, this case involved a transfer of land between a

mother and her sons. Mary herself testified that she wanted to transfer her property to her sons at

a price lower than market value because they were her sons and they were helping her. Put in that

context, we cannot say that the same conclusion as that in Gaddis would apply to these facts. Thus,

we cannot conclude that the mere transfer of mineral interests necessarily equates to Mary having

suffered from a wrongful transfer of her property.

       Further, Mary agrees that at the time of the transfer of the property, there were no

discussions about the mineral interests because she never thought about the mineral interests. In

his deposition, Tommy agreed that there were no discussions relating to the mineral interests.

Tommy testified the mineral interests never occurred to him either. Thus, Tommy and Harry met

their summary judgment burden of showing there is no objectively verifiable evidence of Mary’s

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injury, and the trial court did not err in determining that the discovery rule did not apply to this

case. 2

                                                 CONCLUSION

          Because the discovery rule does not apply to this case, we affirm the trial court’s judgment.

                                                         Karen Angelini, Justice

2
 Because we conclude that there is no objectively verifiable evidence of Mary’s injury, we need not reach Mary’s
other issues of whether the nature of her injury was inherently undiscoverable and whether Mary knew or should have
known of her claims more than four years before she filed suit.

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