Court Opinion

ID: 5079677
Source: CourtListenerOpinion
Date Created: 2021-10-01 12:00:05.949811+00
Date Added: 2024-06-11T08:20:09.535311
License: Public Domain

OPINION ON REMAND
FULLER, Justice.
This case was remanded to us by our Texas Supreme Court for a determination of the applicability of the statute of limitations to Appellants’ cause of action.
We hold that Appellant Branum’s claims, other than fraud, against Texas Commerce and Peat Marwick are barred by the two-year statute of limitations.
UNDERLYING FACTS
This protracted litigation revolves around the sale of the First National Bank Building in Midland, Texas. The sale occurred shortly before disaster struck Midland, Texas, when the oil industry was devastated by the collapse of oil prices. It resulted in the closure of the banking institution known as the First National Bank of Midland (FNBM).
The sale and leaseback of the FNBM building occurred on December 31, 1982. Branum was a stockholder and customer of the FNBM. He also became a general partner in Eagle Properties, Ltd. (Eagle) which was formed to purchase the bank building for $75 million under an agreement to lease it back to the bank for a substantial lease payment covering a three-year period. The $75 million purchase price was paid by the Eagle partners by executing $25 million in notes to FNBM. In addition, two unfunded letters of credit in the amount of $25 million each were issued by Texas Commerce Bank and Inter-First Bank. The letters of credit, one from Texas Commerce Bank and one from Inter-First were funded in June of 1983. First RepublicBank of Dallas became successor in interest to InterFirst Bank of Dallas, and now on remand, the FDIC has become successor in interest to First RepublicBank of Dallas. Since remand, we have granted the Appellants a dismissal of their cause of action as to First RepublicBank (FDIC).
First National Bank of Midland was closed by federal regulators on October 14, 1983. FDIC instituted suit in federal court against Eagle to collect on the $25 million notes and were successful in obtaining judgment against Eagle. FDIC v. Eagle Properties, Ltd., 664 F.Supp. 1027 (W.D.Tex.1985). Eagle appealed but settled before the federal appeals court made a decision. However, the settlement agreement did not provide for vacating the Federal District Court judgment.
On October 11, 1985, Branum filed his lawsuit in state court against the directors of the First National Bank, Texas Commerce Bank, First RepublicBank and Peat Marwick. On December 30, 1985, by way of intervention, the remaining partners in Eagle Properties (except Tom Brown) joined forces with Branum in the lawsuit. The trial court granted summary judgment for all trial court defendants (Appellees in this Court). We affirmed the judgment of the trial court. Eagle Properties, Ltd. v. Scharbauer, 758 S.W.2d 911 (Tex.App.— El Paso, 1988).
Writ was granted. Eagle Properties, Ltd. v. Scharbauer, 807 S.W.2d 714 (Tex.1990). This resulted in our judgment being reversed in part, affirmed in part and the case remanded to us for further consideration of:
[WJhether Branum’s claims other than fraud against TCB, First Republic, [now dismissed] and Peat Marwick are barred by the relevant statutes of limitations. [Emphasis added].
APPELLANTS’ POINTS OF ERROR ON REMAND
• Point of Error No. One asserts the trial court erred in rendering summary judgment.
*562* Point of Error No. Two asserts the trial court erred in holding that Appellants’ claims of negligence and accounting malpractice are subject to a two-year limitation period.
• Point of Error No. Three asserts the trial court erred in holding that Appel-lees conclusively established their right to summary judgment.
We find, as a matter of law, that the Appellants’ claim against Peat Marwick and Texas Commerce Bank for negligence is governed by the two-year statute of limitations. Also, the two-year statute applies to the DTPA claims. Tex.Bus. & Com. Code Ann. § 17.565 (Vernon 1987); Tex. Civ.Prac. & Rem.Code Ann. § 16.003 (Vernon 1988 and Supp.1991). Willis v. Maverick, 760 S.W.2d 642 (Tex.1988); Sledge v. Alsup, 759 S.W.2d 1 (Tex.App.—El Paso 1988, no writ).
We reaffirm what was stated in our original opinion before remand in regard to the convincing evidence pointing to the fact that Appellants knew or should have known about the unhealthy and disastrous financial condition that FNBM was in. Eagle Properties, Ltd. v. Scharbauer, 758 S.W.2d 911 (Tex.App.—El Paso 1988).
The parties involved in Eagle Properties, Ltd. were not only locally prominent but were extremely successful businessmen. The large size of the bank, the small size of the town and the astuteness of the parties involved in Eagle Properties cannot, or at least should not be disregarded.
Those that have resided and done business in small communities can appreciate the fact of how well informed the local business people are as to what is happening in their community without even resorting to media information.
Appellee Peat Marwick, in their brief, at pages 8 through 13, set forth details of the negative news report about FNBM occurring in The Wall Street Journal, The Midland Reporter-Telegram, Texas Business and the FNBM proxy statement. Also, reference is made to admissions and statements made by Appellant Branum and other Eagle Properties, Ltd. partners. It is worth mentioning that Branum himself witnessed a run on the First National Bank eight days before the bank was closed. He had even made efforts to shift his own deposits at FNBM to obtain the maximum amount of $100,000.00 FDIC coverage. All such proof was before the trial court and reviewed previously by us.
We continue to support the trial judge’s finding that Appellees Peat Marwick and Texas Commerce Bank were entitled to summary judgment. The evidence showed, as a matter of law, that Appellants knew or should have known that prior to October 11, 1983, that the financial condition of FNBM had been misrepresented. Therefore, Appellants’ cause of action for negligence and DTPA violations against Appel-lees was barred by the two-year statute of limitations.
Appellants’ Points of Error Nos. One, Two and Three, on remand, are overruled.
BREACH OF CONTRACT AND/OR PROMISSORY ESTOPPEL
• Point of Error No. Four, on remand, asserts the trial court erred in rendering summary judgment as to Appellants’ breach of contract and/or promissory estoppel claims.
Appellants strongly urge that it has a viable action for breach of contract and/or promissory estoppel against Texas Commerce Bank, wherein the four-year statute of limitations is applicable. We previously held that Appellants’ causes of action were for fraud, negligence and DTPA violations. Eagle Properties, 758 S.W.2d at 915, 919.
We disagree with Appellants’ contention that their pleadings were sufficient to put Appellees on notice of their causes of action for breach of contract and/or promissory estoppel. Nor does Appellants’ written response to Appellees’ Motion for Summary Judgment urge anything more than the Appellees’ “committed common law and statutory fraud, deceptive trade practices, and negligence ....” Furthermore, we note that Appellants, in their Motion for Rehearing, in this Court, never urged or *563pointed out to this Court that they had a breach of contract or promissory estoppel claim that had not been addressed.
Appellants' Point of Error No. Four, on remand, is hereby overruled.
CONCLUSION
As to Peat Marwick, we affirm the judgment of the trial court dismissing Appellants’ negligence and DTPA violation claims against Peat Marwick for the reason such claims are barred by limitations.
We also affirm the judgment of the trial court that found that Appellants’ claims against Texas Commerce Bank (other than fraud) were barred by limitations.