Court Opinion

ID: 4062384
Source: CourtListenerOpinion
Date Created: 2016-09-29 20:27:34.201672+00
Date Added: 2024-06-11T14:32:02.850386
License: Public Domain

ACCEPTED
                                                                                                        12-14-00253-CV
                                                                                           TWELFTH COURT OF APPEALS
                                                                                                         TYLER, TEXAS
                                                                                                  11/20/2015 9:16:14 PM
                                                                                                              Pam Estes
                                                                                                                 CLERK

                                                                                     FILED IN
                                      CASE NO. 12-14-00253-CV                 12th COURT OF APPEALS
                                                                                   TYLER, TEXAS
                                                                              11/20/2015 9:16:14 PM
JERRY WEAKS and                                        §   IN THE COURT       OF     PAM ESTES
      JOYCE WEAKS,                                         APPEALS FOR                 Clerk
                                                            TWELFTH COURT OF
                       APPELLANTS                           APPEALS DISTRICT
                                                               OF TEXAS
                                                       §
                  V.
                                                       §

KATHLEEN JEANETTE
  WHITE,                                               §

                       APPELLEE                        §

                                    MOTION FOR REHEARING

TO THE HONORABLE COURT:

            COME NOW JERRY WEAKS and JOYCE WEAKS, Appellants in this cause, who

hereby move the Court for a rehearing of the judgment of this Court rendered on October 21,

2015, and in support of this motion respectfully show the following, to wit:

                                                  I.

      1. Point of Error Number One: The Court of Appeals erred in affirming the trial court's

            judgment that the offset owed by Plaintiff/Appellee Kathleen Jeanette White (“White")

            was limited to the rental value of the property for the period from the time that White

            gave notice of her rescission of the contract through the date that White actually vacated

            the property.

Weaks v. White
Motion for Rehearing

PAGE 1
      2. Argument and authorities:

                       The Court of Appeals has made the same mistake that the trial court made in

            interpreting the offset recognized and required by our Texas Supreme Court in the

            determinative case of Morton v. Nguyen, 412 SW3rd 506 (Tex. 2013). Morton also

            involved a similar case in which a purchaser under an executory contract for deed

            decided to rescind the contract under the provisions of Chapter 5, Subchapter D, of the

            Texas Property Code. The trial court in Morton awarded the purchaser, Nguyen, the

            refund of all payments made by Nguyen, plus the refund of the insurance and tax

            payments made by Nguyen.              That sum totaled over $63,000. The seller, Morton,

            appealed.

                       The Texas Supreme Court applied the common law provision that any such refund

            of the purchase money must be offset by the return of the benefit received by such

            purchaser, which in Morton and in a case like this, is the reasonable rental value of the

            premises subject to the contract. In Morton, the Texas Supreme Court reversed the

            judgment of the trial court and remanded the case for a determination of Nguyen‟s

            liability for the rental value of the premises so that such amount could be offset against

            the refund owed by Morton.

                       It appears that the Court of Appeals, like the trial court, has misinterpreted the

            holding in Morton because of the wording of a particular statement to the effect that the

            “trial court did not consider the value of the Nguyens‟ interim occupation of the property

            ….” See Morton, at 512.           However, the word "interim" does not merely refer to that

            period of time from the purchaser's giving notice of rescission to the date that the

            purchaser actually vacates the property. Rather, "interim" should be interpreted as the

Weaks v. White
Motion for Rehearing

PAGE 2
            total amount of time from the time that the purchaser began the occupation of the

            property until the purchaser actually vacated the property. A full reading of Morton

            makes this clear. Our Texas Supreme Court quotes from Black‟s Law Dictionary in

            holding that rescission by the purchaser must be “accompanied by restitution of any

            partial performance, thus restoring the parties to their precontractual positions.” Morton,

            at 510 (underline added). In such a rescission, each party is to “restore property received

            from the other.” Id., at 510 and 511. “Allowing a buyer to recover all benefits bestowed

            upon the seller upon rescission without also requiring the buyer to surrender the benefits

            that he received under the contract would result in a windfall inconsistent with the

            general nature of Subchapter D‟s cancellation-and-rescission remedy. Rescission is not a

            one-way street. …[It] requires a mutual restoration and accounting.” Id., at 511.

                       After establishing that a purchaser must make restoration to the seller, the Texas

            Supreme Court goes on to specify that such restoration must take the form of the value of

            the purchaser‟s occupancy. The Court makes no directive that such restoration must only

            be the value of the purchaser‟s occupancy after giving notice of intent to rescind. On the

            contrary, the Court states that the purchaser must restore the full value of its occupancy,

            i.e., the value of the total time of the purchaser‟s occupancy. “Rescission is mutual: a

            plaintiff seeking to be restored to the status quo ante must likewise restore to the

            defendant whatever the plaintiff has received in the transaction. While the buyer remains

            entitled to „a full refund of all payments made to the seller,‟ cancellation and rescission of

            a contract also requires that the buyer restore to the seller the value of the buyer‟s

            occupation of the property.” Id., at 512.         Thus, there is no limitation of the buyer‟s

            restitution to the rental value of the occupancy occurring after the buyer gives notice of

            the intent to rescind.

Weaks v. White
Motion for Rehearing

PAGE 3
                       To limit the seller‟s offset to the rental value of the much shorter time from the

            purchaser's rescission to the purchaser‟s vacating the property would fall far short of the

            common law right of offset contemplated and required by our Texas Supreme Court.

            Thus, this Court is urged to grant rehearing and review this issue, and to recognize the

            right of offset for the reasonable rental value of the total period of occupancy of the

            property by the purchaser.

                                                         II.

            1.           Point of Error Number Two: The Court of Appeals erred in failing to recognize

                   the application of common law defenses to the statutory claims of White.

            2.           Argument and authorities:

                          The Court of Appeals seems to recognize that common law defenses may be

                   raised in regard to statutory remedies unless clearly negated by statute. However, the

                   Court of Appeals seems to rely heavily on the fact that there appears to be no mention

                   of common law defenses or common law applications among the statutes in question

                   in Subchapter D of the Texas Property Code. The Court of Appeals thus seems to

                   hold that, since there is no such mention, then the legislature must not have intended

                   for such defenses to be applicable.

                          However, as pointed out by Appellants in their original brief and in the above

                   arguments, and as noted by this Court of Appeals, it is obvious that the Texas

                   Supreme Court has recognized the application of certain common law principles. The

                   obvious example is that of the right of offset as provided and discussed in Morton.

                   That certainly is a common law principle that is not mentioned either in the relevant

                   provisions of the Texas Property Code. For such reasons, the Appellants again argue

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Motion for Rehearing

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                   that there is no less basis for recognizing the common law defenses such as estoppel

                   or laches as there is for recognizing the common law right of offset. The Court of

                   Appeals has argued that the application of the common law defense of estoppel could

                   negate the remedy of rescission that is provided in Subchapter D. However, it is

                   submitted that the occupancy of the property for over 10 years before the buyer

                   invokes the rescission provision is, and will be, a rare case and an extreme situation.

                   Thus, in such an extreme situation as is before this Court, it is submitted that the

                   failure to recognize such common law defenses could also lead to an extremely harsh

                   result. This is particularly disturbing since the failures of the seller under Subchapter

                   D did not result in the purchaser actually suffering any real harm. Whether the

                   defenses raised are termed “laches,” or “statute of limitations,” or “estoppel,” an

                   egregious situation such as that before this Court should warrant the applicability of

                   such in order to avoid the extremely harsh result for the seller and the unmerited

                   windfall of the buyer.

                        Thus, it is submitted that, since our Texas Supreme Court has certainly applied

                   common law principles to the statutory remedies in question, the Court of Appeals

                   should likewise recognize the applicability of common law defenses and remand the

                   case for further hearing so that such defenses may be fully heard.

                                                         III.

                   1. Point of Error Number Three: The Court of Appeals erred in determining that the

                       Appellants waived any objection to the granting of the full amount of attorney

                       fees claimed by the attorney for Appellee White.

                   2. Argument and authorities:

                           The Court of Appeals actually agrees with the argument of Appellants that an

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Motion for Rehearing

PAGE 5
                       award of attorney fees for Appellee White‟s attorney should be limited only to a

                       cause of action which provided for the recovery of attorney fees. In this case, the

                       one cause of action that provided for a recovery of attorney fees was Section

                       5.077 of the Texas Property Code, which requires a seller to provide certain

                       notices to the buyer under an executory contract for deed. If the sellers failed to

                       provide such notice, then the purchasers would be entitled to a statutory remedy

                       of liquidated damages in the amount of $100 for each year in which the sellers

                       failed to give such notice. In this case such liquidated damages amounted to

                       $1000. Of the four sections of Subchapter D that White sued upon, this section is

                       the only one that provided for the recovery of attorney fees. However, it is clear

                       from the record that the hours worked and effort expended by White's attorney,

                       and the dollar amount claimed by White's attorney, related to the total efforts

                       expended by the attorney for all causes of action involved in this case. It is clear

                       that the trial court granted judgment for such total amount of attorney fees. There

                       was thus no segregation of the award of attorney fees to a cause of action which

                       actually provided for such an award. The Court of Appeals has determined that

                       the Appellants failed to file a timely objection to Appellee‟s request for an award

                       of attorney fees and, thus, have waived any right to complain on appeal about the

                       award.

                                However, the summary judgment granted by the trial court was not a final

                       judgment. Rather, it was a partial summary judgment. In other words, this was

                       merely an interlocutory judgment. See Mower v. Boyer, 811 SW2d 560, 562

                       (Tex. 1991). It was clear that there were other issues to be briefed and determined

                       before any final, appealable judgment could be rendered. It is likewise clear that a

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PAGE 6
                       partial summary judgment, as an interlocutory judgment, can be modified and

                       reformed, or withdrawn. See Elder Construction, Inc., vs. Colleyville, 839

                       SW2d 91. 92 (Tex. 1992).

                           The Court of Appeals is treating the partial summary judgment as a final

                       judgment by holding that the Appellants waived any objection or defense to

                       White's motion for summary judgment by failing to raise such objection in their

                       initial response to White's motion. It is submitted that, even in the case of a final

                       summary judgment, a party could raise a misinterpretation or misapplication of

                       law as grounds for a post-judgment motion to reform the judgment or for a new

                       trial. See Harvey v. Alexander, 671 SW3d 727, 729 (Tex. App.-Ft. Worth 1984-

                       no writ).   However, that is not the situation before this Court. Rather, the

                       summary judgment in question is a partial summary judgment which can be

                       reformed or withdrawn by the trial court at any time, whether by a party‟s motion

                       or upon the court‟s own motion. See Elder, 839 SW2d at 92.

                            Thus, in the present case, the Appellants had the right to bring to the trial

                       court's attention the error of law which the trial court had committed in awarding

                       the full amount of attorney fees. The Appellants brought this to the trial court‟s

                       attention by the filing of the motion to reconsider the court‟s prior findings and

                       withdraw and reform the partial summary judgment. This motion was brought by

                       the Appellants while the partial summary judgment could still be reformed. The

                       trial court thus had plenty of opportunity to reform the partial summary judgment.

                       Of course, the trial court ultimately overruled Appellant's motion and left its order

                       granting attorney fees intact. However, Appellants had sought reform of the

                       partial summary judgment in a timely manner and thus had not waived any

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PAGE 7
                       objection to it. Therefore, the trial court‟s ruling was properly preserved for

                       appeal.

                            Since it is fundamental that attorney fees are not to be awarded unless they

                       are clearly authorized by statute, then it follows that White was not entitled to a

                       judgment for attorney fees as a matter of law, except as authorized by Section

                       5.077. The judgment for the attorney fees could have, and should have, been

                       corrected at the trial court level after Appellants had made their motion for the

                       reform of same and before the granting of a final, appealable judgment.

                           The cases cited by the Court of Appeals in support of its ruling are cases

                       involving final summary judgments. One of such cases is Green Int’l, Inc. v.

                       Solis, 951 SW2d 384 (Tex. 1997), which involved the submission of a jury

                       question as to attorney fees. The jury question failed to segregate as to attorney

                       fees and specific claims allowing for a recovery of attorney fees. Neither party

                       objected to such jury submission. The Texas Supreme Court thus determined that

                       any objection to the failure to segregate had been waived. Id., at 389, 390. This

                       case is thus definitely not on point with the situation described in the present case,

                       and it should not be deemed to be determinative of the present case.

                           Likewise, the Court of Appeals cites the case of Harvey v. Alexander, 671

                       SW2d 727 (Tex. App.-Ft. Worth 1984-no writ) as authority that the allowance of

                       a late filing of a response to a motion for summary judgment is entirely a matter

                       of the trial court‟s discretion. The implication is that in the present case, the

                       allowance or the denial of the filing of the Weaks‟ motion was a matter of the trial

                       court‟s discretion, and the proper ground of appeal, if any, should be the abuse of

                       the trial court‟s discretion. It is submitted, however, that such a principle may be

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PAGE 8
                       applicable in a case involving a summary judgment which will be a final,

                       appealable judgment, but it is not applicable in the present case. In Harvey, the

                       appellant attempted to raise issues on appeal as to certain affirmative defenses that

                       were not timely raised in the trial court. The judgment granted in the trial court

                       was a final judgment. The appellate court noted that if the appellant tried to raise

                       such defenses in a late-filed objection (in Harvey, a day before the hearing on the

                       summary judgment), and the trial court, in its discretion, did not allow the filing,

                       then such defensive issues could not be maintained on appeal. See Harvey, at

                       729. Obviously, the Harvey case involved late-filed pleadings related to a final

                       summary judgment. That is very different from the present case. In the present

                       case, the partial summary judgment is absolutely not final and is subject to being

                       amended or even withdrawn. See Elder. The holding in the Harvey case is in no

                       way determinative of the present case.

                           WHEREFORE, the Appellants request that this Court grant this motion, and

                       upon rehearing this matter, that the judgment of the trial court be reversed and

                       rendered, or as applicable, remanded for further proceedings, as originally

                       requested by Appellants.

                                                           Respectfully submitted,

                                                             /s/ Aubrey L. Jones, Jr.
                                                           ___________________________________
                                                           Aubrey L. Jones, Jr.
                                                           Attorney at Law
                                                           State Bar No. 10859100
                                                           P.O. Box 168
                                                           106 W. Tyler St.
                                                           Athens, Texas 75751
                                                           Telephone: (903) 675-7990

Weaks v. White
Motion for Rehearing

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                                                      Fax: (903) 670-3424
                                                      Email: aubreyjoneslaw@embarqmail.com

                                            ATTORNEY FOR APPELLANTS

                                  CERTIFICATE OF SERVICE

            This will certify that a true and correct copy of the above Appellants‟ motion for

rehearing has been served on Appellee‟s attorney of record, Ms. Jane Parreiras-Horta,        in

accordance with the Texas Rules of Appellate Procedure.

            Signed this 20th day of November, 2015.

                                                      /s/ Aubrey L. Jones, Jr.
                                                      _________________________________
                                                      Aubrey L. Jones, Jr.

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