Court Opinion

ID: 4418666
Source: CourtListenerOpinion
Date Created: 2019-07-20 06:47:48.617616+00
Date Added: 2024-06-11T14:49:04.521915
License: Public Domain

In the
                    Court of Appeals
            Second Appellate District of Texas
                     at Fort Worth
                  ___________________________
                       No. 02-18-00102-CV
                  ___________________________

         PETERSON, GOLDMAN & VILLANI, INC., Appellant

                                   V.

ANCOR HOLDINGS, LP; TIMOTHY MCKIBBEN; JOSEPH RANDALL KEENE;
            AND ANCOR PARTNERS, INC., Appellees

               On Appeal from the 141st District Court
                       Tarrant County, Texas
                   Trial Court No. 141-236257-09

              Before Sudderth, C.J.; Kerr and Birdwell, JJ.
                      Opinion by Justice Birdwell
                                       OPINION

      After a decade and a half of legal proceedings, appellant Peterson, Goldman &

Villani, Inc. (PGV) is still seeking someone to satisfy a guaranty agreement. In an

earlier suit, PGV obtained a judgment against the defunct company that executed the

guaranty, Ancor Holdings LLC (Ancor LLC). In this suit, PGV seeks to enforce that

judgment against a group of related parties—Ancor Holdings LP (Ancor LP) and its

principals, who are the appellees here.

      The trial court rendered a take-nothing summary judgment in favor of

appellees on grounds of res judicata, reasoning that PGV should have pressed all of

its claims in the earlier suit. We hold, to the contrary, that PGV’s suit to enforce the

judgment does not offend res judicata. We further hold that PGV conclusively

established Ancor LP’s liability as a successor to Ancor LLC’s judgment debt. We

therefore affirm, in part, reverse and render, in part, and reverse and remand, in part.

                                  I.      Background

      Ancor LLC was a holding company whose members were appellees Timothy

McKibben and Joseph Randall Keene. At the turn of the millennium, Ancor LLC

was a significant investor in a company called OpenPoint Systems, Inc., who was a

borrower under a loan agreement with Bank of America. OpenPoint was struggling

in early 2000. In March 2000, as part of an arrangement to restructure the loan,

Ancor LLC executed a guaranty agreement in favor of Bank of America.

                                            2
         In May 2000, OpenPoint filed for bankruptcy, triggering the guaranty

agreement. Bank of America sold its rights under the guaranty to PGV. PGV then

attempted to collect from Ancor LLC, filing suit in Dallas County. After three and a

half years of arbitration, PGV obtained an arbitration award against Ancor LLC. In

May 2008, a Dallas district court signed a final judgment confirming the arbitration

award.

         In July 2008, PGV discovered that—unbeknownst to it and Bank of America,

and in breach of a clause in the guaranty—Ancor LLC had merged with Ancor LP

approximately eight years earlier, leaving Ancor LP the sole surviving entity. Peterson,

Goldman & Villani, Inc. v. Ancor Holdings, LP, 420 S.W.3d 281, 283 (Tex. App.—

El Paso 2013, pet. denied) (setting out these background facts). Consequently, PGV

moved to modify the judgment to include Ancor LP as a judgment debtor subject to

execution for the confirmed arbitration judgment. The trial court denied PGV’s

motion to modify. Both Ancor LLC and PGV appealed the trial court’s arbitration-

confirmation judgment to the Dallas Court of Appeals, which subsequently affirmed.

         While that judgment was on appeal, though, PGV filed this suit against Ancor

LP and its principals, McKibben, Keene, and Ancor Partners, Inc. PGV sought

satisfaction of the judgment awarded against Ancor LLC, alleging various causes of

action including successor liability. Appellees asserted res judicata and limitations as

defenses. The proceeding was soon transferred to a district court in Tarrant County.

                                           3
      PGV moved for partial summary judgment on its declaratory-judgment and

breach-of-contract claims against Ancor LP.        For their part, appellees filed two

motions for summary judgment in which they argued, inter alia, that PGV’s claims

were barred by res judicata. The trial court denied PGV’s motion for partial summary

judgment, granted appellees’ motions for summary judgment, and dismissed PGV’s

claims with prejudice.

      PGV’s appeal was heard on transfer before the El Paso Court of Appeals, from

which we have borrowed our recitation of the background facts. See id. In pertinent

part, the El Paso court held that the elements of res judicata had not been

conclusively established, and therefore summary judgment could not be sustained on

that basis. Id. at 284–85. The court concluded that appellees had “never addressed”

the privity element of res judicata, “much less established” it conclusively. Id. at 285.

For that reason and others, the court reversed the summary judgment to the extent

that it disposed of PGV’s contractual and declaratory-judgment claims. Id. at 287.

The court affirmed the summary judgment to the extent that it disposed of PGV’s

other claims.1 Id.

      1
         In particular, the court affirmed dismissal of PGV’s claims for fraud, estoppel,
tortious interference with contract, negligent misrepresentation, alter ego, conspiracy,
and punitive damages, because PGV had not challenged dismissal of these claims.
Peterson, Goldman & Villani, Inc. v. Ancor Holdings, LP, 420 S.W.3d 281, 287 (Tex.
App.—El Paso 2013, pet. denied).

                                           4
      On remand, PGV amended its petition; it retained its claim for successor

liability while adding some new theories and nonsuiting others.2 Appellees filed an

amended answer in which they pleaded res judicata and laches, among other

affirmative defenses.

      The parties once again filed dueling motions for summary judgment. Appellees

focused solely on res judicata, taking pains to address privity. PGV argued that it had

conclusively established Ancor LP’s successor liability on the judgment. Once again,

the trial court denied PGV’s motion, granted appellees’ motion, and dismissed all of

PGV’s claims with prejudice. PGV appeals.

                        II.   Summary Judgment Against PGV

      In its first issue, PGV asserts that the trial court erred in granting summary

judgment on the basis of res judicata. PGV asserts that appellees failed to establish

two of the three elements of its res judicata defense: (1) privity between Ancor LLC

and the appellees here and (2) that the subsequent action is based on claims or causes

of action that were or should have been raised in the first action. We agree that the

claims in the subsequent suit—in particular, PGV’s successor-liability claim to enforce

the arbitration judgment—were not and should not have been raised in the first

      2
       In its live pleading, PGV alleged causes of action including contractual and
successor liability, principal-agent liability, alter ego, punitive damages, unjust
enrichment, and multiple forms of estoppel, while nonsuiting its other theories.

                                          5
action. These were therefore not the type of claims that were required to be raised in

the first action or be forever barred.3

       We review a summary judgment de novo. Travelers Ins. v. Joachim, 315 S.W.3d
860, 862 (Tex. 2010). We consider the evidence presented in the light most favorable

to the nonmovant, crediting evidence favorable to the nonmovant if reasonable jurors

could, and disregarding evidence contrary to the nonmovant unless reasonable jurors

could not. Mann Frankfort Stein & Lipp Advisors, Inc. v. Fielding, 289 S.W.3d 844, 848

(Tex. 2009). We indulge every reasonable inference and resolve any doubts in the

nonmovant’s favor. 20801, Inc. v. Parker, 249 S.W.3d 392, 399 (Tex. 2008). A

defendant is entitled to summary judgment on an affirmative defense if the defendant

conclusively proves all elements of that defense. Frost Nat’l Bank v. Fernandez, 315
S.W.3d 494, 508–09 (Tex. 2010); see Tex. R. Civ. P. 166a(b), (c). When both parties

move for summary judgment and the trial court grants one motion and denies the

other, the reviewing court should review both parties’ summary judgment evidence

and determine all questions presented. Mann Frankfort, 289 S.W.3d at 848. We should

       3
        PGV further asserts that the doctrine of the law of the case prohibits this
court from reconsidering the El Paso Court of Appeals’s determination that appellees
had not conclusively established the element of privity. PGV argues that the
summary judgment record has not changed in anywise; appellees’ only “new”
evidence was PGV’s own summary judgment motions, which were already part of the
summary judgment record. We agree that little has changed in the state of the record.
But because of our disposition on another element of res judicata, we need not
address PGV’s arguments concerning the law of the case and privity. See Tex. R. App.
P. 47.1; Horsley-Layman v. Adventist Health Sys./Sunbelt, Inc., 221 S.W.3d 802, 809 (Tex.
App.—Fort Worth 2007, pet. denied).

                                           6
then render the judgment that the trial court should have rendered. See Myrad Props.,

Inc. v. LaSalle Bank Nat’l Ass’n, 300 S.W.3d 746, 753 (Tex. 2009); Mann Frankfort, 289
S.W.3d at 848.

      Res judicata is an affirmative defense. See Tex. R. Civ. P. 94. A defendant who

moves for summary judgment on the basis of this affirmative defense therefore has

the burden to prove conclusively all its elements as a matter of law. Dauz v. Valdez,

571 S.W.3d 795, 803 (Tex. App.—Houston [1st Dist.] 2018, no pet.); see Parsons v.

Turley, No. 02-09-00381-CV, 2010 WL 5187704, at *2 (Tex. App.—Fort Worth

Dec. 23, 2010, pet. denied) (mem. op.).

      Res judicata, also known as claim preclusion, prevents the relitigation of a

finally adjudicated claim and related matters that should have been litigated in a prior

suit.4 State & Cty. Mut. Fire Ins. Co. v. Miller, 52 S.W.3d 693, 696 (Tex. 2001). The

policies behind the claim-preclusion doctrine reflect the need to bring all litigation to

an end, prevent vexatious litigation, maintain stability of court decisions, promote

judicial economy, and prevent double recovery. Engelman Irrigation Dist. v. Shields Bros.,

Inc., 514 S.W.3d 746, 750 (Tex. 2017). The elements of the res judicata defense are as

follows: (1) a prior final determination on the merits by a court of competent

      4
        An arbitration award is treated as a prior final judgment and has preclusive
effect for purposes of res judicata. Premium Plastics Supply, Inc. v. Howell, 537 S.W.3d
201, 205 (Tex. App.—Houston [1st Dist.] 2017, no pet.); Blumberg v. Bergh, No. 02-04-
00138-CV, 2005 WL 1047592, at *2 (Tex. App.—Fort Worth May 5, 2005, no pet.)
(mem. op.) (“An arbitration award has the same effect as the judgment of a court of
last resort[.]”).

                                            7
jurisdiction; (2) identity of parties, or those in privity with them, in the prior and

subsequent actions; and (3) the subsequent action is based on claims or causes of

action that were or should have been raised in the first action. Travelers Ins., 315
S.W.3d at 862. Our focus here is the third element.

       In determining whether a claim or cause of action should have been raised in a

prior action, Texas follows the transactional approach. Citizens Ins. Co. of Am. v.

Daccach, 217 S.W.3d 430, 449 (Tex. 2007). Under this approach, we look to whether

the subsequent claim or cause of action arises out of the same subject matter—the

same “transaction, or series of connected transactions, out of which” the original suit

arose. Id. (quoting Barr v. Resolution Tr. Corp. ex rel. Sunbelt Fed. Sav., 837 S.W.2d 627,

631 (Tex. 1992)). Determining the scope of the “subject matter” or “transaction” of

the prior suit requires “an analysis of the factual matters that make up the gist of the

complaint, without regard to the form of action.”            Id.   This should be done

pragmatically, “giving weight to such considerations as whether the facts are related in

time, space, origin, or motivation, whether they form a convenient trial unit, and

whether their treatment as a trial unit conforms to the parties’ expectations or

business understanding or usage.” Id.

       Here, the two lawsuits did not involve a common time, origin, motivation, or

domain.    The two lawsuits involve different parties and are predicated on two

different agreements, executed at different times and for different purposes. The

guaranty agreement was executed in March 2000 by Bank of America and Ancor LLC

                                            8
to shore up Bank of America’s loan to OpenPoint. The merger agreement was

executed in September 2000 by Ancor LLC and Ancor LP in order to restructure

McKibben and Keene’s holdings in a different organizational form.              The two

agreements are each self-contained, with no internal references between each other.

“Where claims arise at different times through separate transactions not made in the

context of a continuing legal relationship, res judicata may not apply, even where the

parties and subject matter of the transactions are the same.” Pinebrook Props., Ltd. v.

Brookhaven Lake Prop. Owners Ass’n, 77 S.W.3d 487, 497 (Tex. App.—Texarkana 2002,

pet. denied); see Karle v. Innovative Direct Media Ltd., 309 S.W.3d 762, 766 (Tex. App.—

Dallas 2010, no pet.) (determining res judicata did not apply because the “two lawsuits

arose under different facts and different contracts”); Tex. Beef Cattle Co. v. Green, 860
S.W.2d 722, 724 (Tex. App.—Amarillo 1993, writ denied) (concluding that res

judicata did not apply because the two suits concerned separate cattle transactions that

were executed months apart). Moreover, as appellees emphasized during the initial

proceeding, PGV did not have a “continuing legal relationship” with Ancor LP. See

Pinebrook Props., 77 S.W.3d at 497. In their summary judgment briefing, appellees

argued, “Ancor LLC and Ancor LP are not the same entity . . . and [they] never have

been.” They further argued, “These are two distinct entities, and a merger did not

render them ‘one and the same’ for purposes of PGV’s lawsuit.” Ancor LP thus

made clear that its “expectations or business understanding” were to be treated as

                                           9
separate from Ancor LLC for purposes of the guaranty agreement. See Citizens Ins.,
217 S.W.3d at 449.

      As such, the two proceedings entailed two discrete sets of proof. The first

proceeding revolved around the interpretation of Ancor LLC’s guaranty agreement, as

well as evidence concerning the value of OpenPoint’s collateral.           The second

proceeding was to focus on the distinct terms of the merger agreement and the

successor liability of Ancor LP. Such claims would not necessarily have made a

convenient unit for trial. And if a purpose of res judicata is to prevent repetitive

litigation, we note that PGV’s claims did not require any issues related to OpenPoint

or Ancor LLC’s guaranty to be duplicated in this second suit.5 See Engelman Irrigation,
514 S.W.3d at 750. PGV could simply allege that it had a valid judgment to enforce

against appellees, without delving into detail concerning the origins of that judgment.

      Such a lawsuit would not be forbidden, for res judicata does not bar actions

brought to enforce prior judgments. See Matthews Constr. Co. v. Rosen, 796 S.W.2d 692,

694 (Tex. 1990); In re Estate of Lynch, 395 S.W.3d 215, 227 (Tex. App.—San Antonio

2012, pet. denied); McCarroll v. My Sentinel, LLC, No. 14-08-01171-CV, 2009 WL
4667403, at *2 (Tex. App.—Houston [14th Dist.] Dec. 10, 2009, no pet.) (mem. op.);

Walker v. Anderson, 232 S.W.3d 899, 912 (Tex. App.—Dallas 2007, no pet.). Applying

      5
        Had PGV filed a second suit on the guaranty agreement, such a suit would
have undoubtedly covered some of the same transactional ground as before. But
PGV did not file such a suit. Instead, the guaranty debt was reduced to and
transformed into a judgment, and in this suit to enforce the judgment, few if any
issues from the first suit need be repeated.

                                          10
the doctrine of res judicata in a suit to enforce a judgment would “pervert the sanctity

of judgments, not preserve them,” which is a goal of the doctrine. Lynch, 395 S.W.3d

at 227 (quoting Matthews, 796 S.W.2d at 694).

      In Matthews, the Texas Supreme Court applied this thinking to hold that once a

judgment against a corporation was obtained, res judicata did not bar the plaintiff

from seeking to enforce that judgment against an owner who used the corporation as

his alter ego. See 796 S.W.2d at 692–94. The court rejected the owner’s assertion of

res judicata and explained that in seeking to pierce the corporate veil, the plaintiff was

not attempting to challenge the prior judgment but was seeking to enforce it, as the

victorious party was entitled to do. McCarroll, 2009 WL 4667403, at *2 (summarizing

Matthews); see Strange v. Estate of Lindemann, 408 S.W.3d 658, 661 (Tex. App.—Fort

Worth 2013, no pet.) (“Typically, a postjudgment suit against an alleged alter ego is

not a collateral attack on the prior judgment, and thus is not barred by res judicata.”).

      In our view, Matthews is on point. Under Matthews, a party may seek to impose

liability for a corporation’s judgment obligations onto a set of closely related

principals without running afoul of res judicata; such a claim is not one that should

have been raised in the initial litigation, per the third element of res judicata. Here,

too, PGV seeks to enforce a judgment for Ancor LLC’s obligations against a set of

closely-related principals who were never made parties to the initial suit. The only

difference here is that the primary basis for that third-party responsibility is successor

liability rather than veil piercing. Under the logic of Matthews, PGV may seek to

                                           11
enforce the confirmed arbitration judgment, and such a claim is not one that should

have been raised in the initial litigation.

       Appellees argue, however, that regardless of whether its own liability should have

been raised in the initial proceeding, that claim was indeed raised in the initial

proceeding.     Because it was raised in the initial proceeding, appellees argue,

res judicata bars further litigation of this claim. Appellees point to PGV’s motion to

modify during the confirmation proceeding, in which PGV discussed the merger

agreement and asked the trial court to hold Ancor LP liable on the arbitration award

as a successor to Ancor LLC. Appellees argue that PGV has raised essentially the

same successor theory of liability again here and that PGV’s claim should therefore be

precluded.

       We disagree. While PGV attempted to raise its successor-liability theory during

the confirmation proceeding, it could not do so due to the limited nature of an

arbitration-confirmation proceeding, which is restricted to the issue of whether

statutory grounds exist for modifying or vacating the award. See Hoskins v. Hoskins,

497 S.W.3d 490, 494 (Tex. 2016); Blumberg v. Bergh, No. 02-04-00138-CV, 2005 WL
1047592, at *2 (Tex. App.—Fort Worth May 5, 2005, no pet.) (mem. op.). Those

statutory grounds do not encompass PGV’s successor-liability theory, and the

confirmation proceeding therefore offered no meaningful opportunity to raise this

argument. See Tex. Civ. Prac. & Rem. Code Ann. §§ 171.088, .091. It would be

inequitable to apply res judicata to this effectively unraised theory, which has never

                                              12
been considered on its merits due to the procedural confines of a confirmation

proceeding. See Kothmann v. Cook, 113 S.W.3d 471, 475–76 (Tex. App.—Amarillo

2003, no pet.) (declining to apply res judicata, reasoning that “[b]ecause of the special

and limited nature of the turnover proceeding, Kothmann would not have been

entitled to raise those substantive claims against Cook had he attempted to do so”); see

also Sysco Food Servs., Inc. v. Trapnell, 890 S.W.2d 796, 799 n.2 & 805 (Tex. 1994)

(declining to apply issue preclusion to state-law claims, in part because a federal

procedural requirement prevented the plaintiff from bringing its state-law claims in a

prior federal suit).

       It would also be inconsistent with the policy underlying res judicata. One of

the policies supporting res judicata is preventing double recovery.         See Engelman

Irrigation, 514 S.W.3d at 750. But applying res judicata in this case would prevent any

recovery whatsoever on a lawfully obtained judgment. “A court should not apply res

judicata to deprive a prior judgment of its full legal effect.” Drake Interiors, LLC v.

Thomas, 433 S.W.3d 841, 853 (Tex. App.—Houston [14th Dist.] 2014, pet. denied)

(op. on reh’g). This we will not do.

       To obtain summary judgment based on res judicata, it was appellees’ initial

burden to conclusively establish each of the defense’s essential elements. See Dauz,
571 S.W.3d at 803. As to the third element of res judicata, whether the claim was or

should have been raised in the initial litigation, this burden was not satisfied. At best,

the summary judgment record showed two suits based on two discrete transactions,

                                           13
and the second suit was merely an attempt to enforce the judgment obtained through

the first suit. Because appellees failed to establish their burden, summary judgment

could not have been granted based on this affirmative defense. The trial court erred

in concluding otherwise, and in dismissing PGV’s claims for contractual and

successor liability, principal-agent liability, unjust enrichment, and multiple forms of

estoppel.6

        We sustain PGV’s first issue.

                    III.   Summary Judgment Against Ancor LP

A.      Successor Liability of Ancor LP

        In its second issue, PGV asserts that it conclusively established that Ancor LP

was liable for the arbitration-confirmation judgment against Ancor LLC. PGV notes

that under Texas law, the surviving entity in a merger assumes all liabilities of the

entity that was merged out. PGV further points out that the merger agreement

contains express language under which Ancor LP agreed to assume Ancor LLC’s

liabilities. PGV asserts that as the surviving entity, Ancor LP must have assumed

liability on the judgment by necessity and as a matter of law. PGV asserts that it is

therefore entitled to summary judgment against Ancor LP for its theory of successor

liability.

       We do not reach the same conclusion as to PGV’s theories of alter ego,
        6

punitive damages, and plain estoppel. The El Paso Court of Appeals has already
affirmed dismissal of those theories. See Peterson, Goldman & Villani, 420 S.W.3d at
287.

                                          14
      To prevail, PGV was required to conclusively show that no genuine issue of

material fact exists and that it is entitled to judgment as a matter of law. Tarr v.

Timberwood Park Owners Ass’n, Inc., 556 S.W.3d 274, 278 (Tex. 2018). The burden

would then shift to appellees to present evidence creating a fact issue. Walker v.

Harris, 924 S.W.2d 375, 377 (Tex. 1996).

      Under Texas law, a certificate of merger must be filed for a merger to become

effective if any domestic limited liability company is a party to the merger. See

Trustmark Nat’l Bank v. Tegeler (In re Tegeler), 586 B.R. 598, 650 n.33 (Bankr. S.D. Tex.

2018) (quoting Tex. Bus. Orgs. Code Ann. § 10.151(a)(1)(A)); see also Tex. Bus. Orgs.

Code Ann. § 1.002(22) (including domestic limited liability companies in the definition

of “filing entity,” which must file under section 10.151). “A merger that requires such

a filing takes effect on the acceptance of the filing of the certificate of merger by the

secretary of state or county clerk, as appropriate.” Tegeler, 586 B.R. at 650 n.33

(cleaned up). When a merger takes effect, “all liabilities and obligations of each

organization that is a party to the merger are allocated to one or more of the surviving

or new organizations in the manner provided by the plan of merger.” Alta Mesa

Holdings, LP v. Ives, 488 S.W.3d 438, 449 n.13 (Tex. App.—Houston [14th Dist.] 2016,

pet. denied) (quoting Tex. Bus. Orgs. Code Ann. § 10.008(a)(3)). The surviving

organization to which a liability is allocated under the plan of merger is the primary

obligor for the liability. Id. (quoting Tex. Bus. Orgs. Code Ann. § 10.008(a)(4)).

                                           15
      Attached to PGV’s motion for summary judgment were three exhibits showing

the completed merger between Ancor LLC, a domestic limited liability company, and

Ancor LP, a Delaware limited partnership. The first exhibit was titled “Agreement

and Plan of Merger.” It specified that Ancor LLC would merge “with and into”

Ancor LP, the surviving entity, and that Ancor LP would “assume all the liabilities of

every kind and description of” Ancor LLC. Keene executed the merger agreement on

behalf of both Ancor LLC and LP. 7 The second exhibit was the “Articles of Merger,”

which was filed with the Texas Secretary of State. The articles recited that Ancor LLC

and LP were merging and that Ancor LP was the surviving entity. The third exhibit

was a “Certificate of Merger” issued by the Texas Secretary of State, approving the

merger as of September 22, 2000. This evidence conclusively established a completed

merger.

      By dint of the merger agreement and the completed merger itself, Ancor LP

assumed all of Ancor LLC’s liabilities, including the confirmed arbitration judgment.

See id. We conclude that PGV satisfied its initial burden to conclusively establish its

successor-liability claim. See Tarr, 556 S.W.3d at 278. The burden therefore shifted to

appellees to present evidence creating a fact issue. See Walker, 924 S.W.2d at 377.

      7
       More specifically, Keene executed the agreement as a member of Ancor LLC
and as president of Ancor Partners, Inc., which was the general partner of Ancor LP.

                                          16
B.     Res Judicata

       Appellees first assert that res judicata precludes summary judgment in favor of

PGV.

       The nonmovant cannot defeat the granting of a motion for summary judgment

by merely pleading an affirmative defense. New Talk, Inc. v. Sw. Bell Tel. Co., 520
S.W.3d 637, 645 (Tex. App.—Fort Worth 2017, no pet.). Instead, the nonmovant

“must come forward with evidence sufficient to raise an issue of fact on each element

of the defense to avoid summary judgment.” Id.

       For the reasons already stated, supra, we conclude that appellees have not

established a fact issue as to the third element of res judicata. Therefore, res judicata

does not stand in the way of a summary judgment in favor of PGV. See id.

C.     Attack on Arbitration Award

       In an attempt to create a fact issue, appellees next dispute the arbitrator’s

determination that Ancor LLC was liable on the guaranty. Appellees argue that the

guaranty was carefully drafted so that it would trigger only if the value of OpenPoint’s

collateral reached a certain level. Appellees assert that this level was never attained, as

Bank of America recognized when it sold its rights under the guaranty for 2.59 cents

on the dollar. Appellees contend that the arbitrator therefore erred by finding any

liability on the guaranty.

       But this is not an appeal from judicial confirmation of the arbitration award;

that matter was resolved by the Dallas Court of Appeals nearly ten years ago. See

                                            17
Ancor Holdings, LLC v. Peterson, Goldman & Villani, Inc., 294 S.W.3d 818, 834 (Tex.

App.—Dallas 2009, no pet.). Even if the merits of the confirmation proceeding were

properly before us, we could not entertain appellees’ criticism of the arbitrator’s

reasoning.    “Contentions that the arbitrator’s reasoning was legally erroneous or

internally inconsistent, or that the arbitrator misinterpreted the contract or misapplied

the law do not provide a basis for vacating an award.” Denbury Onshore, LLC v. Texcal

Energy S. Tex., LP, 513 S.W.3d 511, 520 (Tex. App.—Houston [14th Dist.] 2016, no

pet.). “Committing mistakes of fact or law is not a proper ground for vacating an

award[.]” Id.

      Appellees’ attack on the arbitration award is doubly precluded, and it does not

create a fact issue sufficient to defeat summary judgment in favor of PGV. See

Walker, 924 S.W.2d at 377.

D.    Laches

      Next, appellees resist summary judgment by asserting that they have created a

fact issue on a different affirmative defense: laches. See New Talk, 520 S.W.3d at 645.

Appellees note that PGV did not file suit against Ancor LP until eight years after the

merger.      According to appellees, this unreasonable delay prejudiced appellees’

discovery rights and ability to settle the case, and PGV’s belated claims against

appellees should therefore be barred by laches.

      Laches is an equitable remedy that prevents a plaintiff from asserting a claim

because of a lapse of time; the claim is said to be stale. Vickery v. Vickery, 999 S.W.2d
18
342, 355 (Tex. 1999) (op. on reh’g). To invoke the equitable doctrine of laches,8 the

moving party ordinarily must show (1) an unreasonable delay by the opposing party in

asserting it rights, and (2) the moving party’s good faith and detrimental change in

position because of the delay. In re Laibe Corp., 307 S.W.3d 314, 318 (Tex. 2010) (orig.

proceeding). The defense is available only in extraordinary cases. Brink v. Fid. Bank of

Fort Worth, 966 S.W.2d 684, 684 (Tex. App.—Fort Worth 1998, no pet.).

       PGV challenges appellees’ laches defense on its second element in particular.

To defeat summary judgment, appellees were required to create a fact issue as to

       8
        As an initial matter, PGV asserts that laches does not apply to the purely legal
claims that are at issue in this appeal. PGV cites cases from our sister courts holding
that laches, as an equitable doctrine, may bar only equitable claims or proceedings,
and it is categorically inapplicable to legal claims. See Wayne v. A.V.A. Vending, Inc., 52
S.W.3d 412, 415 (Tex. App.—Corpus Christi 2001, pet. denied); Tex. Att’y Gen. of State
of Tex. on Behalf of Ford v. Daurbigny, 702 S.W.2d 298, 300 (Tex. App.—Houston [1st
Dist.] 1985, no writ). PGV might have also cited older authorities from this court, in
which we implied as much. See Steward v. Steward, 734 S.W.2d 432, 434 n.2 (Tex.
App.—Fort Worth 1987, no writ) (op. on reh’g); Reynolds v. Farmers & Merchants Nat’l
Bank of Nocona, 135 S.W.2d 556, 558 (Tex. App.—Fort Worth 1939, no writ).

       However, the Texas Supreme Court has consistently indicated that laches
might apply to legal claims. See Rogers v. Ricane Enters., Inc., 772 S.W.2d 76, 80 (Tex.
1989) (describing the first element of laches as “an unreasonable delay by one having
legal or equitable rights in asserting them”); City of Fort Worth v. Johnson, 388 S.W.2d
400, 403 (Tex. 1964) (same). Recognizing this, some Texas courts have expressly held
that legal claims are subject to laches. See, e.g., Regent Int’l Hotels, Ltd. v. Las Colinas
Hotels Corp., 704 S.W.2d 101, 106 (Tex. App.—Dallas 1985, no writ).

       We have reserved judgment, and we will continue to do so here. See Sw. Bell
Tel., LP v. Chappell, No. 02-12-00071-CV, 2013 WL 257369, at *4 n.4 (Tex. App.—
Fort Worth Jan. 24, 2013, no pet.) (mem. op.). We need not decide today whether
laches may apply to legal claims, for even assuming that laches generally applies,
appellees’ proof in support of this defense fails to raise a genuine issue of material
fact. The laches defense thus fails regardless of its applicability.

                                            19
whether they had changed position in good faith and to their detriment because of the

delay. See Laibe, 307 S.W.3d at 318; New Talk, 520 S.W.3d at 645. To that end,

appellees offered Keene’s affidavit testimony that if PGV had not delayed in filing

suit, Ancor LP could have better pursued a “suitable compromise” with Bank of

America.

      In response, PGV observes that its delay could not have impaired appellees’

ability to settle with Bank of America. When PGV acquired the guaranty debt, Bank

of America parted with any interest in the debt. From that point, Bank of America

could not settle a dispute regarding rights it no longer owned. Therefore, it was

impossible for any delay on PGV’s part to impair the prospects of a bargain between

appellees and Bank of America.9

      Keene also testified concerning another form of detrimental change in position:

that PGV’s delay hampered “Ancor LP’s ability to discover information from Bank of

America to substantiate why the Bank never pursued collection of the Guaranty

against Ancor LP.” We doubt the value of such an inquiry into Bank of America’s

interpretation of the guaranty. What Bank of America thought of the guaranty’s

language is immaterial, because parol evidence such as this cannot be used to

contradict the unambiguous terms of the agreement. See Alta Mesa, 488 S.W.3d at

450. “Where the parties have entered into an unambiguous written contract, the

      9
       This much was admitted during Keene’s deposition.

                                         20
instrument alone will be deemed to express the intention of the parties because it is

the objective intent, not subjective intent, that controls.” Id.

       But even if this avenue of discovery had value, appellees offered nothing

beyond Keene’s conclusory assertions to show that this avenue was impaired. Keene

did not identify any unsuccessful effort to discover evidence. Just the opposite, there

was no shortage of record evidence concerning Bank of America’s thoughts on the

guaranty. The arbitration award makes reference to a number of exhibits concerning

the bank’s impressions, including an affidavit from the bank’s representative

discussing his views of the guaranty, letters and emails drafted by the bank

representative summarizing his perspective of the guaranty’s terms, internal bank

documents purporting to define what terms were incorporated into the guaranty,

direct testimony by counsel for the bank that certain terms were included in the

guaranty, and a report drafted by the bank’s vice president explaining the bank’s

thinking. In short, there was plenty of what Keene claimed to lack.

       We have no doubt that one purpose of the laches doctrine is “to prevent

injustice against one party that could result when another asserts his demands so long

after they matured that evidence has been lost or impaired.” Fazakerly v. Fazakerly,

996 S.W.2d 260, 265 (Tex. App.—Eastland 1999, pet. denied). But there must be a

showing of change in position. See id. (sustaining laches based on evidence that a key

witness’s memory was ruined by Alzheimer’s disease); Jernigan v. Scott, 518 S.W.2d 278,

282–83 (Tex. App.—San Antonio 1974, writ ref’d n.r.e.) (sustaining laches because

                                            21
key witness had died). Appellees offered only speculation about missed opportunities

for discovery. This does not suffice to raise a fact issue as to the “extraordinary”

circumstances required for laches. See Brink, 966 S.W.2d at 684; Stanley Works v.

Wichita Falls ISD, 366 S.W.3d 816, 826 (Tex. App.—El Paso 2012, pet. denied)

(“Stanley’s bare claims that the [evidence] had been destroyed and witnesses had

scattered do not conclusively prove that Stanley’s ability to defend was impaired or

that it made a good faith and detrimental change of position as a result of the delay.”);

Wakefield v. Bevly, 704 S.W.2d 339, 345 (Tex. App.—Corpus Christi 1985, no writ)

(rejecting laches claim because there was “no showing that the records were

unavailable” due to delay).

      To raise a genuine issue of material fact, “the evidence must transcend mere

suspicion.” Ford Motor Co. v. Ridgway, 135 S.W.3d 598, 601 (Tex. 2004). Appellees’

evidence does not cross this threshold. Because appellees have failed to create a fact

issue, their laches defense is insufficient to defeat PGV’s entitlement to summary

judgment. See New Talk, 520 S.W.3d at 645.

E.    Summary

      Through its evidence, PGV conclusively established its entitlement to summary

judgment on successor liability, see Tarr, 556 S.W.3d at 278, and appellees failed to

create a fact issue sufficient to show otherwise. See Walker, 924 S.W.2d at 377; New

Talk, 520 S.W.3d at 645. We conclude that the trial court should have granted

summary judgment holding Ancor LP liable on the judgment against Ancor LLC. We

                                           22
will therefore render the judgment the trial court should have rendered. See Myrad

Props., 300 S.W.3d at 753. To that extent, we sustain PGV’s second issue.

               IV.    Summary Judgment Against Other Appellees

      Also within their second issue, PGV contends that it established summary

judgment grounds for its claims against the other appellees, Keene, McKibben, and

Ancor Partners, Inc. PGV asserts that it conclusively established that these other

appellees operated in an implied partnership with Ancor LLC, and these appellees are

therefore jointly and severally liable on the judgment against Ancor LLC.

      PGV appears to have raised this implied-partnership claim for the first time on

appeal, for this claim appears nowhere in PGV’s live petition or its motion for

summary judgment. A trial court cannot enter judgment on a theory of recovery not

sufficiently set forth in the pleadings or otherwise tried by consent. Hartford Fire Ins.

Co. v. C. Springs 300, Ltd., 287 S.W.3d 771, 779 (Tex. App.—Houston [1st Dist.] 2009,

pet. denied) (op. on reh’g); Street v. Skipper, 887 S.W.2d 78, 80 (Tex. App.—Fort

Worth 1994, writ denied). Moreover, the movant must state in its motion the specific

grounds upon which the summary judgment should be granted. See Tex. R. Civ. P.

166a(c). It is settled that a court cannot grant summary judgment on grounds that

were not presented. Fed. Deposit Ins. Corp. v. Lenk, 361 S.W.3d 602, 609 (Tex. 2012).

                                           23
The trial court therefore could not have granted summary judgment on this unpleaded

and unpresented claim. 10

      To that extent, we overrule the remainder of PGV’s second issue.

                                 V.     Conclusion

      We affirm the trial court’s judgment to the extent it disposed of PGV’s theories

of alter ego, punitive damages, and plain estoppel. We reverse and render judgment in

favor of PGV on its claim to hold Ancor LP liable on the arbitration-confirmation

judgment rendered against Ancor LLC. We remand to the trial court for further

proceedings concerning PGV’s other claims, including principal-agent liability, unjust

enrichment, and multiple forms of estoppel.

                                                     /s/ Wade Birdwell

                                                     Wade Birdwell
                                                     Justice

Delivered: July 18, 2019

      10
        See also Super Starr Int’l, LLC v. Fresh Tex Produce, LLC, 531 S.W.3d 829, 839–
40 (Tex. App.—Corpus Christi–Edinburg 2017, no pet.) (citing Duncan v. Allen,
No. 9:15-CV-29, 2016 WL 4467674, at *5 (E.D. Tex. Aug. 24, 2016), and Robbins v.
Payne, 55 S.W.3d 740, 748 (Tex. App.—Amarillo 2001, pet. denied)) (rejecting, as
patently unmeritorious, a claim that an implied partnership overlapped the
organizational form of an LLC and its members).

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