Justia Contracts Opinion Summaries

The Supreme Court affirmed in part and reversed in part the judgment of the court of appeals in this defamation, breach of contract, and fraudulent inducement case.After Defendant, Plaintiff’s employer, offered him an oral deal to “buy in” the business in exchange for managing two automobile dealerships, Plaintiff was falsely accused of taking illegal kickbacks on used-car acquisitions and lost his job. The jury found that Defendant defrauded and defamed Plaintiff but did not find that the parties agreed to a buy-in deal that included interests in the dealerships and their underlying real estate. The jury awarded Plaintiff $2.2 million in defamation damages and $383,150 in fraud damages. The trial court rendered judgment on the jury’s verdict. The court of appeals reversed and rendered a take-nothing judgment. The Supreme Court held (1) the jury’s failure to find that the parties agreed to the specific contract terms submitted in the contract question did not preclude Plaintiff from recovering the value of the disputed dealership interests as benefit-of-the-bargain damages under a fraud theory that required proof of an enforceable contract; and (2) legally sufficient evidence supported the damages awarded for loss of reputation and mental anguish in the past, but no evidence supported the existence of future damages or a finding that the kickback allegations caused any lost-income damages. View "Anderson v. Durant" on Justia Law

The Supreme Court reversed the decision of the court of appeals holding that a cause of action for acknowledgment of a debt must be “specifically and clearly” pleaded “in plain and emphatic terms” because this holding conflicts with Tex. R. Civ. P. 47(a), which provides that a pleading is “sufficient” if it gives “fair noice of the claim involved.”A Trust sued Defendants seeking payment on a debt. Defendants moved for summary judgment arguing that the Trust’s claims were barred by the statute of limitations because the Trust had not properly pleaded acknowledgment. The trial court agreed and granted summary judgment for Defendants. The court of appeals affirmed, concluding that while the Trust had raised acknowledgment in response to Defendants’ motion for summary judgment, it had failed to plead acknowledgement as a cause of action because it had not done so “specifically and clearly” and in “plain and emphatic terms.” The Supreme Court reversed and remanded, holding that the Trust provided fair notice to Defendants of its claim on their acknowledgment and thus satisfied Rule 47, and the court of appeals erred in requiring a higher standard. View "DeRoeck v. DHM Ventures, LLC" on Justia Law

In this insurance dispute, the Supreme Court held that the issue of whether the trial court properly disregarded some of the jury’s findings should be remanded to the court of appeals for reconsideration in light of this Court’s decision in USAA Texas Lloyds Co. v. Menchaca, __ S.W.3d __ (Tex. 2018).Plaintiffs sued their insurer, State Farm, for breach of contract and Insurance Code violations. The jury found that both parties breached the insurance contract but that Plaintiffs breached first. The jury then awarded damages for State Farm’s breach of the policy and for Plaintiffs’ extra-contractual claims. The trial court disregarded two of the jury’s findings about Plaintiffs’ breach of the insurance contract and rendered judgment for Plaintiffs. The court of appeals affirmed. While State Farm's appeal was pending, the Supreme Court issued its final opinion and judgment in Menchaca, which clarified whether an insured can recover policy benefits based on an insurer’s violation of the Texas Insurance Code even though the jury failed to find that the insurer failed to comply with its obligations under the policy. On appeal, the Supreme Court held (1) State Farm’s first issue should be remanded for reconsideration in light of Menchaca; and (2) as to the remaining issues, the court of appeals’ judgment is affirmed. View "State Farm Lloyds v. Fuentes" on Justia Law

The nature of the function a municipality was performing when it entered into a contract governs the analysis of whether the municipality was engaged in its governmental or proprietary function and thus whether the municipality was immune from suit.Plaintiff filed this suit alleging that the City of Jacksonville breached its lease agreements with Plaintiff. The City filed a motion for summary judgment arguing that governmental immunity barred the breach of contract claim. The trial court granted the motion. The court of appeals affirmed based on governmental immunity, concluding that the governmental/proprietary dichotomy that applies to tort claims does not apply to breach of contract claims. The Supreme Court reversed, holding that the dichotomy applies whether a municipality commits a tort or breaches a contract. On remand, the court of appeals held that governmental immunity applied to bar Plaintiff’s contract claim because the claim arose from the City’s performance of a governmental function. The Supreme Court reversed, holding that the contract claim arose from the City’s performance of a proprietary function so governmental immunity did not apply. View "Wasson Interests, Ltd. v. City of Jacksonville" on Justia Law

The one-satisfaction rule applied to this case, and therefore, the trial court erred in denying the nonsettling defendant settlement credits.At issue on this appeal was Plaintiff’s claims against nonsettling defendants alleging breach of contract, fraud, and other causes of action. Plaintiff had earlier settled with four other defendants. The jury returned a verdict in favor of Plaintiff. The nonsettling defendants asserted that, under the one-satisfaction rule, they were entitled to offset the final judgment by the amounts the four settling defendants paid to Plaintiff, plus interest. The trial court disagreed and rendered judgment against the nonsettling defendants, jointly and severally, for the full jury award. The court of appeals affirmed the trial court’s denial of settlement credits, ruling that Plaintiff’s claims against the nonsettling defendants were independent of the other injuries Plaintiff alleged against the settling defendants. The Supreme Court reversed, holding that the nonsettling defendants were entitled to reduce the judgment by the total amount of the settlements Plaintiff received and any applicable interest. View "Sky View At Las Palmas, LLC v. Mendez" on Justia Law

In this dispute over an offset provision in an oil and gas lease the Supreme Court reversed the judgment of the court of appeals reversing the trial court’s summary judgment in the lessee’s favor on the grounds that the lessee did not conclusively demonstrate compliance with the provision.On appeal, the court of appeals determined that the lessee did not conclusively prove that it complied with the offset provision and thus was not entitled to summary judgment. In reversing, the Supreme Court held (1) the offset provision contained specific requirements, and the lessee met those requirements; and (2) the court of appeals read a requirement into the lease that its unambiguous language did not support. View "Murphy Exploration & Production Co. v. Adams" on Justia Law

The Supreme Court affirmed the judgment of the court of appeals reversing the trial court’s ruling that TRO-X, LP was entitled to a back-in percentage of the working interest in five mineral leases under which Anadarko Petroleum was lessee.TRO-X sued Anadarko, asserting claims for breach of contract and trespass to try title and seeking a declaratory judgment that the leases were top leases and therefore subject to TRO-X’s back-in interest. The trial court concluded that the leases were top leases, in which TRO-X retained a back-in interest, rather than new leases, which washed out TRO-X’s interest. In reversing, the court of appeals concluded that the leases were not top leases. The Supreme Court agreed, holding that the leases at issue were not top leases subject to TRO-X’s back-in interest. View "TRO-X, L.P. v. Anadarko Petroleum Corp." on Justia Law

The lower courts in this case erred by requiring a signatory to arbitrate its non-contractual claims against non-signatories.Jody James Farms, JV purchased a crop revenue coverage insurance policy from Rain & Hail, LLC through the Altman Group. The insurance policy contained an arbitration clause. Neither the Altman Group nor any of its employees signed the agreement. After Rain & Hail denied coverage for a grain sorghum crop loss suffered by Jody James and the parties arbitrated the dispute, Jody James sued the Altman Group and its agent (collectively, the Agency) for breach of fiduciary duty and deceptive trade practices. The Agency successfully moved to compel arbitration under the insurance policy. At arbitration, Jody James asserted that it had a right to proceed in court against the Agency because the Agency was a non-signatory to the arbitration agreement. The arbitrator resolved that issue and the merits of the dispute in the Agency’s favor. The trial court confirmed the award. The court of appeals affirmed. The Supreme Court reversed because (1) Jody James and the Agency did not agree to arbitrate any matter; and (2) Jody James may not be compelled to arbitrate under agency, third-party-beneficiary, or estoppel theories. View "Jody James Farms, JV v. Altman Group, Inc." on Justia Law

At issue was the function of a clause in a real property deed that “saves and excepts” one-half of “all royalties from the production of oil, gas and/or other minerals that may be produced from the above described premises which are now owned by Grantor” when the deed does not disclose that the grantor does not own all of the royalty interests and does not except any other royalty interests from the conveyance.The trial court held that the deeds did not create a Duhig problem - where the grantor owns less than he purports to convey - by construing the clause as reserving for the grantor one-half of all royalties “which [were then] owned by Grantor.” The court of appeals determined that the clause created a Duhig problem, interpreting the clause as reserving for the grantor one-half of all royalties produced from the “above described premises which [were then] owned by Grantor.” The Supreme Court affirmed as modified, holding (1) instead of reserving a one-half royalty interest for the grantors, the clause merely excepted that interest from the grant, and therefore, the deeds did not create a Duhig problem; and (2) each party with an interest in the tracts owned a one-quarter interest in the royalties produced. View "Perryman v. Spartan Texas Six Capital Partners, Ltd." on Justia Law

The Texas Public Utility Regulatory Act grants the Texas Public Utility Commission (the PUC) exclusive jurisdiction to resolve issues underlying a customer’s claim that a PUC-regulated utility breached a contract by failing timely to provide electricity.Chaparral Energy LLC filed a breach of contract action against Oncor Electric Delivery Company, LLC, a PUC-regulated utility. A jury found in favor of Chaparral. While Oncor’s appeal was pending, the Fort Worth Court of Appeals issued its decision in Oncor Electric Delivery Co. v. Giovanni Homes Corp., 438 S.W.3d 644 (Tex.App. 2014), which held that the PUC had exclusive jurisdiction over Giovanni Homes’s breach of contract claim against Oncor. Oncor then moved to dismiss Chaparral’s claim for want of jurisdiction. The court of appeals affirmed. The Supreme Court reversed and rendered judgment dismissing the case for want of jurisdiction, holding (1) Chaparral was required to exhaust its administrative remedies before the PUC before seeking relief in district court; (2) the inadequate-remedy exception to the exhaustion-of-remedies requirement does not apply in this case; and (3) requiring Chaparral to exhaust administrative remedies does not deprive it of its constitutional rights to a jury trial and to open courts. View "Oncor Electric Delivery Co. LLC v. Chaparral Energy, LLC" on Justia Law