Court Opinion

ID: 4065328
Source: CourtListenerOpinion
Date Created: 2016-09-29 21:56:46.433448+00
Date Added: 2024-06-11T14:31:48.934288
License: Public Domain

ACCEPTED
                                                                                03-14-00812-CV
                                                                                        5173978
                                                                     THIRD COURT OF APPEALS
                                                                                AUSTIN, TEXAS
                                                                           5/6/2015 12:53:18 PM
                                                                              JEFFREY D. KYLE
                                                                                         CLERK
                       CAUSE NO. 03-14-00812-CV

                                                       FILED IN
                    IN THE COURT OF APPEALS     3rd COURT OF APPEALS
                             FOR THE                AUSTIN, TEXAS
                                                5/6/2015 12:53:18 PM
                  3RD JUDICIAL DISTRICT OF TEXAS JEFFREY D. KYLE
                          AUSTIN, TEXAS                 Clerk

                            BOBBIE WHITE,
                              Appellant,
                                 VS.
                        JOSEFINO BENCOMO III,
                               Appellee

                       APPELLEE’S BRIEF
                 ORAL HEARING NOT REQUESTED

From the District Court, 26th Judicial District of Williamson County, Texas
  Trial Court Cause No. 14-0374-C26; the Honorable Donna King, Judge

                                  Respectfully submitted,

                                  FRED E. WALKER, P.C.
                                  /s/Fred E. Walker
                                  Fred E. Walker
                                  Texas Bar No. 20700400
                                  609 Castle Ridge Road, Suite 220
                                  Austin, TX 78746
                                  Tel. (512) 330-9977
                                  Fax. (512) 330-1686
                                  Fred@FredWalkerLaw.com
                                  Attorney for Appellee
                                Page 1 of 26
                                              Table of Contents

I. Statement of the Case.......................................................................................5
II. Issues Presented................................................................................................7
III.    Summary of the Argument..........................................................................7
IV.     Argument .......................................................................................................8
  A. A deed retaining a vendor’s lien is executory only in the sense that
  bare legal title remains in the seller to be automatically vested in the
  buyer upon payment of the purchase money. ................................................8
  B. The Deed of Trust did not cure the transaction of being executory. ...23
  C. Appellee’s interpretation of subchapter D does not undermine its
  intended purpose. .............................................................................................23
V. Prayer ...............................................................................................................24

                                                     Page 2 of 26
                                              Index of Authorities

Cases

Acker v. Texas Water Comm'n, 790 S.W.2d 299, 301 (Tex.1990) .......................12
Brown v. De La Cruz, 156 S.W.3d 560, 566 (Tex.2004).......................................15
Carroll v. Wied, 572 S.W.2d 93, 95 (Tex.Civ.App.-Corpus Christi 1978, no
  writ) .....................................................................................................................18
Flores v. Millennium Interests, Ltd., 185 S.W.3d 427, 429 (Tex.2005)................16
Flowers v. Zuniga, No. 11–06–00144–CV, 2008 WL 1723225, at *1, 2008
  Tex.App. LEXIS 2664, at *2 (Tex.App.-Eastland Apr. 10, 2008, no pet.)
  (mem. op.)...........................................................................................................15
Gaona v. Gonzales, 997 S.W.2d 784, 786–87 (Tex.App.-Austin 1999, no pet.) 18
Graves v. Diehl, 958 S.W.2d 468, 470 (Tex.App.-Houston [14th Dist.] 1997, no
  pet.) ......................................................................................................................17
Henderson v. Love, 181 S.W.3d 810, 812 (Tex.App.-Texarkana 2005, no pet.)16
Lexington Ins. Co. v. Strayhorn, 209 S.W.3d 83, 85 (Tex.2006) ..........................11
Marker v. Garcia, 185 S.W.3d 21, 26–27 (Tex.App.-San Antonio 2005, no pet.)
  ..............................................................................................................................19
Nguyen v. Yovan, 317 S.W.3d 261, 270 (Tex.App.-Houston [1st Dist.] 2009,
  pet. denied).........................................................................................................15
Reeder v. Curry, 294 S.W.3d 851, 856 (Tex.App.-Dallas, 2009 pet. denied) ...17
Sanchez v. Brandt, 567 S.W.2d 254, 259 (Tex.Civ.App.-Corpus Christi 1978,
  no writ)................................................................................................................19
Shook v. Walden, 304 S.W.3d 910, 917 (Tex.App.-Austin 2010, no pet.) .........12
Shook v. Walden, 368 S.W.3d 604, 623 (Tex. App. 2012), reh'g overruled (May
  9, 2012), review denied (Oct. 26, 2012) ...........................................................14
Shook v. Walden, 368 S.W.3d 604, 627 (Tex. App. 2012), reh'g overruled (May
  9, 2012), review denied (Oct. 26, 2012) ...........................................................10
State v. Shumake, 199 S.W.3d 279, 284 (Tex.2006) ...........................................11

                                                       Page 3 of 26
Ward v. Malone, 115 S.W.3d 267, 270–71 (Tex.App.-Corpus Christi 2003, pet.
  denied) ................................................................................................................17
Zapata v. Torres, 464 S.W.2d 926, 928 (Tex. Civ. App. 1971) .............................8
Zuniga v. Velasquez, 274 S.W.3d 770, 771 (Tex.App.-San Antonio 2008, no
  pet.) ......................................................................................................................15
Statutes

Tex. Prop. Code § 5.066..........................................................................................4
Tex. Prop. Code § 5.077..........................................................................................4
Tex. Prop. Code Ann. § 5.079(a) .........................................................................14
Texas Property Code Chapter 5, Subchapter D .......................................passim
Other Authorities

Highlights of Some Recent Texas Laws Related to Executory Contracts for
  Deeds...................................................................................................................23

                                                       Page 4 of 26
                          I.    Statement of the Case

      Appellee foreclosed on Appellant’s home and filed a forceable entry

and detainer suit seeking to evict Appellant from the property. Appellant

brought this action to quiet title on April 15, 2014 asking the court to set

aside Appellee’s foreclosure of the property on the flawed theory that

Appellee failed to comply with Tex. Prop. Code § 5.066 Appellant further

sought statutory damages arising from Appellee’s failure to provide

Appellant with annual accounting statements in accordance with Tex.

Prop. Code § 5.077.

      Appellant’s claims are based upon her erroneous theory that

Appellee’s sale of the property is an executory contract governed by Texas

Property Code Chapter 5, Subchapter D because the warranty deed

conveying title to Appellant’s property contains a reservation of a vendor's

lien to secure payment of the promissory note given in partial

consideration for the purchase of the property.

      Appellant obtained an ex-parte Temporary Restraining Order on

April 16, 2015 - without providing notice to Appellee’s attorney - despite
                                  Page 5 of 26
the fact that Appellant’s attorney and Appellee’s attorney had been

attempting to negotiate a settlement for several months before the TRO was

filed. The court held a hearing on Appellant’s request for a Temporary

Restraining Order on April 25, 2014. The parties agreed to submit the

matter to the court by filing cross motions for summary judgment.

Appellee further agreed to, and subsequently did, rescind the foreclosure

to allow Appellant another opportunity to cure the arrearage and reinstate

the note.

      Appellee filed his motion for summary judgment on June 17, 2014.

Appellant filed her motion for summary judgment on June 18, 2014. The

court held a hearing on the competing motions for summary judgment on

August 12, 201 and entered a docket entry on August 15, 2014 ruling in

favor of Appellee. Appellant filed a motion to reconsider on September 15,

2014. The court signed a Summary Judgment Order on September 25, 2014.

The court denied Appellant’s motion to reconsider on December 2, 2014.

Appellant filed her notice of appeal on December 22, 2014.

                                Page 6 of 26
                             II.    Issues Presented

     Is a deed retaining a vendor's lien to secure a purchase money loan

executory as between the vendor and vendee such that the transaction is

within the meaning of “executory contract” as contemplated by Texas

Property Code Chapter 5, Subchapter D?

     Does the holder of a real estate note secured with a vendor’s lien and

a deed of trust lien have an obligation to comply with the provisions of

Texas Property Code Chapter 5, Subchapter D?

                      III.   Summary of the Argument

     A deed retaining a vendor's lien to secure purchase money is

executory as between the vendor and vendee only in the sense that the

naked legal title remains in vendor to be automatically vested in vendee

upon payment of the purchase money, and in all other respects the deed is

not executory but is an executed contract. Humphreys-Mexia Co. v. Gammon,

113 Tex. 247, 254 S.W. 296 (1923)

                                    Page 7 of 26
      Texas Property Code Chapter 5, Subchapter D is applicable only to

contracts for deed and does not apply to traditional real property financing

transactions involving the use of real estate lien notes secured with

vendor’s liens and deed of trust liens. See Flores v. Millennium Interests, Ltd.,

185 S.W.3d 427, 439 (Tex. 2005).

                                 IV.   Argument

   A. A deed retaining a vendor’s lien is executory only in the sense that
      bare legal title remains in the seller to be automatically vested in
      the buyer upon payment of the purchase money.

      Appellant argues that a seller’s retention of a vendor’s lien in a

warranty deed results in the conveyance being an executory contract for

conveyance of real property subject to Subchapter D of the Texas Property

Code. This position is not supported by legislative history or case law and

would lead to absurd results.

      A deed retaining a vendor's lien to secure purchase money is

executory as between the vendor and vendee only in the sense that the

naked legal title remains in vendor to be automatically vested in vendee

                                   Page 8 of 26
upon payment of the purchase money, and in all other respects the deed is

not executory but is an executed contract. Humphreys-Mexia Co. v. Gammon,

113 Tex. 247, 254 S.W. 296 (1923)

      It has long been established by Texas decisions that where a vendor

reserves in his deed an express vendor's lien to secure unpaid purchase

money, the contract is executory for some purposes, and superior title

remains in the vendor until the purchase money is paid. On the purchaser's

default, the vendor has his choice of a variety of remedies. He may sue for

his money and to foreclose the lien, or he may rescind the contract and

resume possession, or he may recover title and possession in a suit brought

for that purpose. Zapata v. Torres, 464 S.W.2d 926, 928 (Tex. Civ. App. 1971).

      The Texas Supreme Court in Humphreys-Mexia Co. at page 300 writes:

“The opinions of this court have uniformly referred to deeds of the

character here involved as executory contracts in which the legal title to the

land conveyed remains in the vendor until the purchase-money notes are

paid. The Humphreys-Mexa court wrote: “.... while the deed here involved is

an executory contract as between the vendor and vendee, and those in

                                    Page 9 of 26
privity with them, it is so only in the sense that the naked legal title

remains in the vendor, to be automatically vested in the vendee upon

payment of the purchase money, and that in all other respects, between

such parties, and in all respects in so far as strangers to the transaction are

concerned, the deed is not executory, but is an executed contract. Carey v.

Starr, 93 Tex. 508, 515, 56 S.W. 324; Stitzle v. Evans, 74 Tex. 596, 12 S.W.
326; Ogburn v. Whitlow, 80 Tex. 239, 15 S.W. 807; Brown v. Montgomery, 89
Tex. 250, 253, 34 S.W. 443; Chase v. Swayne, 88 Tex. 218, 224, 30 S.W. 1049,

53 Am. St. Rep. 742; Texas Pacific Coal & Oil Co. v. Fox (Tex. Civ. App.) 228
S.W. 1021, 1024; Rooney v. Porch (Tex. Com. App.) 239 S.W. 910; Dealey v.

Lake, 62 Tex. Civ. App. 429, 131 S.W. 441, 442; Frantz v. Masterson (Tex. Civ.

App.) 133 S.W. 740, 742; Blewitt v. Greene, 57 Tex. Civ. App. 588, 122 S.W.
914, 916; Smith v. Jarvis (Tex. Civ. App.) 24 S.W. 854, 855.”

      Appellant argues that the reservation by the defendant of a vendor’s

lien retaining superior title in her deed renders the deed an executory

contract; and that therefore the entirety of Texas Property Code Chapter 5,

Subchapter D applies to the Appellant’s transaction with the defendant.

                                   Page 10 of 26
She cites Shook v. Walden, 368 S.W.3d 604, 627 (Tex. App. 2012), reh'g

overruled (May 9, 2012), review denied (Oct. 26, 2012) as authority for her

proposition. But Appellant’s position is not supported by the plain

language of the statute, the legislative history, or case law.

      Shook held that a contract for the sale of real property to be used in

the building of a residence was not an “executory contract” within the

meaning of Texas Property Code Chapter 5, Subchapter D. The court held

the land contract at issue was not a contract for deed, but rather was a

conventional contract for the sale of realty.

      In so holding, the court in Shook said: “While acknowledging that a

contract for deed is one kind of “executory contract” under subchapter D,

the Waldens insist that it is not the only kind. Some of our sister courts

have stated or suggested as much. See Yarto v. Gilliland, 287 S.W.3d 83, 90 n.

10 (Tex.App.-Corpus Christi 2009, no pet.) (noting that executory contracts

contemplate “that the purchaser complete performance in the future” and

that a contract for deed “is a type of executory contract”); Reeder, 294
S.W.3d at 856 (“In an executory contract for the sale of land, such as the

                                  Page 11 of 26
contract for deed in this case....”). However, no court to date has

interpreted or applied “executory contract” under subchapter D as broadly

as the Waldens urge here. Instead, the decisions are consistent with a

recognition of what is apparent in the structure and wording of subchapter

D – that the “executory contract” contemplated by the Legislature, whether

or not extending beyond contracts for deed, contemplates that a purchaser

satisfy a series of obligations over an extended period of time before the

seller has an obligation to transfer title.”

      Resolution of this issue is a question of law that turns purely on

statutory construction. When construing a statute, the court’s primary

objective is to give effect to the Legislature's intent. See State v. Shumake, 199
S.W.3d 279, 284 (Tex.2006). The court seeks that intent “first and foremost”

in the statutory text. Lexington Ins. Co. v. Strayhorn, 209 S.W.3d 83, 85

(Tex.2006). “Where text is clear, text is determinative of that intent.”

Entergy Gulf States, Inc. v. Summers, 282 S.W.3d 433, 437 (Tex.2009) (op. on

reh'g) (citing Shumake, 199 S.W.3d at 284; Alex Sheshunoff Mgmt. Servs. L.P.

v. Johnson, 209 S.W.3d 644, 651–52 (Tex.2006)). The court should consider

                                   Page 12 of 26
the words in context, not in isolation. State v. Gonzalez, 82 S.W.3d 322, 327

(Tex.2002). The court relies on the plain meaning of the text, unless a

different meaning is supplied by legislative definition or is apparent from

context, or unless such a construction leads to absurd results. See City of

Rockwall v. Hughes, 246 S.W.3d 621, 625–26 (Tex.2008) (citing Texas Dep't of

Transp. v. City of Sunset Valley, 146 S.W.3d 637, 642 (Tex.2004)); see also Tex.

Gov't Code Ann. § 311.011 (West 2005) (“Words and phrases shall be read

in context and construed according to the rules of grammar and common

usage,” but “[w]ords and phrases that have acquired a technical or

particular meaning, whether by legislative definition or otherwise, shall be

construed accordingly.”). The court also presumes that the Legislature was

aware of the background law and acted with reference to it. See Acker v.

Texas Water Comm'n, 790 S.W.2d 299, 301 (Tex.1990). The court further

presumes that the Legislature selected statutory words, phrases, and

expressions deliberately and purposefully. See DeQueen, 325 S.W.3d at 635;

Shook v. Walden, 304 S.W.3d 910, 917 (Tex.App.-Austin 2010, no pet.).

                                  Page 13 of 26
      The pivotal question governing Appellant’s entitlement to relief, as

she acknowledges, is whether the deed is an “executory contract” within

the meaning of Chapter 5, Subchapter D of the Texas Property Code.

      Subchapter D does not explicitly define “executory contract.”

Appellant argues that the term “executory contract” under subchapter D

applies to transactions involving the use of real estate lien notes secured by

vendors’ liens retained in deeds because the seller’s reservation of a

vendor’s lien retaining superior title in his deed renders the contract

executory.

      But Appellant’s proposed interpretation of the term “executory

contract” leads to absurd results and is contrary to the context which is

apparent in subchapter D. Appellant states in the last line of page 5,

paragraph 4.4 of her motion for summary judgment: “Therefore, the

entirety of subchapter D applies to their transaction.” If Appellant’s

contention is true, the purchaser can cancel the purchase within 14 days of

the transaction and the holder of a real estate lien note secured with a

vendor’s lien would not be required to conduct a non-judicial foreclosure

                                 Page 14 of 26
of the property. He could simply send the notice under Tex. Prop. Code

Ann. § 5.063 and the transaction would be canceled. This absurd argument

is the basis for this frivolous appeal.

      Tex. Prop. Code Ann. § 5.079(a) requires a “seller” of property to

“transfer recorded, legal title of the property covered by [an] executory

contract to the purchaser not later than the 30th day after the date the seller

receives the purchaser's final payment due under the contract.” A seller

who violates this requirement is liable to the purchaser for liquidated

damages in the amount of $250 per day for each day the seller fails to

transfer title between thirty-one and ninety days after the seller receives the

purchaser's final payment, and $500 per day thereafter. See id. § 5.079(b).

Shook v. Walden, 368 S.W.3d 604, 623 (Tex. App. 2012), reh'g overruled (May

9, 2012), review denied (Oct. 26, 2012) Since Appellee transferred legal title

to Appellant at closing it is absurd to argue that Section 5.079 of the

Property Code applies to this transaction.

      Further, § 5.062(c) provides: “This subchapter does not apply to an

executory contract that provides for the delivery of a deed from the seller

                                   Page 15 of 26
to the purchaser within 180 days of the date of the final execution of the

executory contract.” Since Appellee delivered the deed to Appellant at

closing, and since that date was zero days from closing, by definition this

transaction is excluded from Texas Property Code Chapter 5 subchapter D.

      Texas courts, including the Texas Supreme Court, have frequently

equated “executory contract” as used in subchapter D with a contract for

deed. See, e.g., Flores, 185 S.W.3d at 429 (equating the two); Brown v. De La

Cruz, 156 S.W.3d 560, 566 (Tex.2004) (“Since 1995, the Texas Property Code

has required that sellers by executory contract (or ‘contract for deed’) of

certain residential property in Texas must record and transfer a deed

within thirty days of final payment.”); Nguyen v. Yovan, 317 S.W.3d 261, 270

(Tex.App.-Houston [1st Dist.] 2009, pet. denied) (treating “executory

contract” under subchapter D as synonymous with “contract for deed”);

Zuniga v. Velasquez, 274 S.W.3d 770, 771 (Tex.App.-San Antonio 2008, no

pet.) (same); Flowers v. Zuniga, No. 11–06–00144–CV, 2008 WL 1723225, at

*1, 2008 Tex.App. LEXIS 2664, at *2 (Tex.App.-Eastland Apr. 10, 2008, no

pet.) (mem. op.) (same); Sharp v. Smith, No. 12–07–00219–CV, 2008 WL

                                  Page 16 of 26
257237, at *1, 2008 Tex.App. LEXIS 666, at *1 (Tex.App.-Tyler Jan. 31, 2008,

no pet.) (mem. op.) (same); Henderson v. Love, 181 S.W.3d 810, 812

(Tex.App.-Texarkana 2005, no pet.) (same); Kirk v. Barnett, 566 S.W.2d 122,

122 (Tex.Civ.App.-Houston [14th Dist.] 1978, no writ) (equating executory

contracts for conveyance with contracts for deed under the predecessor to

subchapter D); see also Graves, 958 S.W.2d at 472 (equating executory

contracts for the sale of land to contracts for deed in a suit not under

subchapter D or its predecessor).

      Considering the context in which the term “executory contract” is

used in Subchapter D it is apparent that the Legislature intended it to have

a technical meaning basically synonymous with a contract for deed. A

contract for deed is a form of real property conveyance in which the

purchaser obtains an immediate right to possession but the seller retains

legal title and has no obligation to transfer it unless and until the purchaser

finishes paying the full purchase price (and, often, interest, fees, or other

related obligations), which is typically done in installments over several

years. See Flores v. Millennium Interests, Ltd., 185 S.W.3d 427, 429 (Tex.2005)

                                  Page 17 of 26
(“... executory contracts [are] also known as contracts for deed. A contract

for deed, unlike a mortgage, allows the seller to retain title to the property

until the purchaser has paid for the property in full.”); Reeder v. Curry, 294
S.W.3d 851, 856 (Tex.App.-Dallas, 2009 pet. denied) (“[i]n an executory

contract for the sale of land, such as the contract for deed in this case, the

superior title remains with the seller until the purchaser fulfills its part of

the contract” and “[i]f the purchaser defaults under the contract, the seller

is entitled to possession of the property”); Ward v. Malone, 115 S.W.3d 267,

270–71 (Tex.App.-Corpus Christi 2003, pet. denied) (stating that a “contract

for deed is an agreement by a seller to deliver a deed to property once

certain conditions have been met” and that it entitled the buyer to

immediate possession, that the seller retains title until the purchase price is

fully paid, and that the price is typically paid in installments over several

years); Graves v. Diehl, 958 S.W.2d 468, 470 (Tex.App.-Houston [14th Dist.]

1997, no pet.) (same). A contract for deed differs from a conventional

contract for sale of realty, in which the seller and purchaser mutually agree

to complete payment and title transfer on a date certain (the “closing

                                   Page 18 of 26
date”). See Flores, 185 S.W.3d at 429 (comparing a contract for deed with a

mortgage); id. at 435 (Wainwright, J., concurring) (“in [contracts for deed],

legal title to the property does not transfer until after all purchase

payments have been made, unlike a traditional mortgage in which legal

title transfers upon closing the transaction”). Unlike a contract for deed,

under which the buyer has an equitable right, but no obligation, to

complete the purchase, Gaona v. Gonzales, 997 S.W.2d 784, 786–87

(Tex.App.-Austin 1999, no pet.), the buyer under a typical real estate

contract is contractually obligated to complete the purchase and may be

liable for breach upon failure to pay the seller, Carroll v. Wied, 572 S.W.2d
93, 95 (Tex.Civ.App.-Corpus Christi 1978, no writ) (“In a contract of sale,

one party is obligated to sell and the other to purchase.”). In effect, a

contract for deed serves to provide persons unable to obtain conventional

mortgage financing an alternative means of purchasing real property. See

Flores, 185 S.W.3d at 434–35 (Wainwright, J., concurring) (explaining that

residents building homes in the colonias “need this method of financing

because they do not have access to traditional mortgage financing”); Marker

                                  Page 19 of 26
v. Garcia, 185 S.W.3d 21, 26–27 (Tex.App.-San Antonio 2005, no pet.) (noting

that enactment of parts of subchapter D responded to a problem with

substandard housing developments whose residents did not have access to

traditional financing); Sanchez v. Brandt, 567 S.W.2d 254, 259 (Tex.Civ.App.-

Corpus Christi 1978, no writ) (observing, with reference to contracts for

deed, “[i]t is a matter of common knowledge ... that many poor people are

unable to obtain conventional financing when they wish to purchase

residential property. Frequently it is necessary for them to pay out the

entire purchase price of a tract of land prior to procuring title....”).

      Subchapter D contains several consumer-protection provisions that

have application to contracts for deed but not to transactions involving

conveyances of property in which the seller executes a warranty deed

reserving a vendor’s lien. These include:

 1. Section 5.064, which forbids a “seller” from enforcing the remedies of

    rescission or of “forfeiture and acceleration” unless and until the seller

    first gives notice of its intent to enforce the remedies and of the

    purchaser's right to cure under section 5.065. See id. § 5.064. Section

                                   Page 20 of 26
  5.063, in turn, prescribes the content of the notice under section 5.064.

  In part, the notice must advise the purchaser that “YOU ARE NOT

  COMPLYING WITH THE TERMS OF THE CONTRACT TO BUY

  YOUR PROPERTY,” identify the default, and that unless the purchaser

  cured the default within a time specified in the notice, that “THE

  SELLER HAS THE RIGHT TO TAKE POSSESSION.” See id. § 5.063.

2. Section 5.066, which requires that if the purchaser defaults after paying

  “40 percent or more of the amount due or the equivalent of 48 monthly

  payments under the executory contract,” the seller cannot enforce the

  remedies of rescission or of forfeiture, but may have the property sold

  at public auction following notice and 60 days to cure. See id. § 5.063.

3. Section 5.074, which authorizes the purchaser to “cancel and rescind an

  executory contract for any reason ... not later than the 14th day after

  the date of the contract.” See id. § 5.074.

4. Section 5.077, which requires the seller to provide the purchaser, “in

  January of each year for the term of the executory contract,” a

  statement setting forth “the amount paid under the contract,” “the

                                Page 21 of 26
    remaining amount owed under the contract,” “the number of

    payments remaining under the contract,” and certain information

    relating to tax and insurance payments on the property. See id. § 5.077.

      The Appellant’s reasoning would imply that every deed reserving a

vendor’s lien in favor of the seller (which are typically assigned to a lender)

would be an “executory contract” subject to subchapter D. This would lead

to results that the Legislature could not possibly have intended because it

would render the limiting phrase “executory contract” superfluous and

impose on such contracts numerous provisions that simply do not fit those

type of conveyances.

      Although a contract for deed is only one kind of “executory contract”

no court to date has interpreted or applied “executory contract” under

subchapter D as broadly as the Appellant urges here. Instead, the decisions

are consistent with a recognition of what is apparent in the structure and

wording of subchapter D – that the “executory contract” contemplated by

the Legislature, whether or not extending beyond contracts for deed,

contemplates that a purchaser satisfy a series of obligations over an

                                 Page 22 of 26
extended period of time before the seller has an obligation to transfer title.

The transaction between the Appellant and the defendant in this case is not

this sort of contract.

   B. The Deed of Trust did not cure the transaction of being executory.

   The fact that the parties included a deed of trust in the transaction does

not have any effect on whether the deed is an “executory contract”

governed by Texas Property Code, Chapter 5, Subchapter D.

   C. Appellee’s interpretation of subchapter D does not undermine its
      intended purpose.

      Texas Property Code, Chapter 5, Subchapter D was intended to

provide protections to people buying land under contracts for deed; not

people involved in traditional owner financing of property through the use

of real estate lien notes secured by vendor’s liens retained in deeds and by

deed of trust liens.

      The Texas Attorney General explains the law in his website under the

heading Highlights of Some Recent Texas Laws Related to Executory

Contracts for Deeds as follows: “In 2001 the Texas Legislature expanded

                                  Page 23 of 26
protections for persons buying land under executory contracts (typically

called contracts for deeds). The major change was to make applicable

statewide amended versions of provisions that had applied only in certain

economically distressed counties. The revised provisions are in Texas

Property Code, Chapter 5, Subchapter D (“Prop, Code”).

A.    The Trial Court Ordered Relief Not Requested in Appellant’s
      Motion.

      Appellee does not object to Appellant’s request for this court to

reverse and vacate that portion of the trial court’s order declaring the

Notice of Lis Pendens filed by Appellant during the pendency of this action

to be void and of no effect. Appellee offered to eliminate this portion of the

judgment before it was entered by the trial court but Appellant refused,

apparently desiring to justify some basis for this otherwise frivolous

appeal.

                                  V.    Prayer

      WHEREFORE, Appellee prays this Court reverse and vacate that

portion of the summary judgment that ordered that the Notice of Lis
                                 Page 24 of 26
Pendens that Appellant filed during the pendency of this action is void and

of no effect and sustain the remainder of the trial court’s grant of summary

judgment; and order such other and further relief to which Appellee may

be justly entitled.

                                   Respectfully submitted,

                                   FRED E. WALKER, P.C.

                                   /s/Fred E. Walker
                                   Fred E. Walker
                                   Texas Bar No. 20700400
                                   609 Castle Ridge Road, Suite 220
                                   Austin, TX 78746
                                   Tel. (512) 330-9977
                                   Fax. (512) 330-1686
                                   Attorney for Defendant
                                   Josefino Bencomo III

                                Page 25 of 26
                    CERTIFICATE OF COMPLIANCE

           I hereby certify that there are 4,449 words in this Appellee’s
Brief excluding those words exempted by T.R.A.P. 9.4.(i)(1).

                                   /s/Fred E. Walker
                                   Fred E. Walker

                       CERTIFICATE OF SERVICE

     I certify that on May 6, 2015 a true and correct copy of Appellee’s
Reply Brief was served by fax on Tony A. Pitts, Attorney for Appellant
Bobbie White, at (512) 244-4355 and by email to tapitts@taplawfrim.com.

                                   /s/Fred E. Walker
                                   Fred E. Walker

                                Page 26 of 26