Monday, March 21, 2016

If It Isn’t in Writing It Probably Didn’t Happen

Originally published by » Blog.

Trey Wilson San Antonio Texas Real Estate Attorney, Trey Wilson Real Estate Lawyer in San Antonio wrote:
In a short opinion, the Fourth Court of Appeals appears to have reaffirmed the importance of the statute of frauds in agreements related to real estate. However, its re-affirmation appears to turn on a legal technicality, and the Court could well have missed an opportunity to clarify the law under an interesting set of facts.
In its opinion issued in Bakke Development Corp. v. Albin on March 16, 2016, the 4th Court upheld a summary judgment granted by the trial court on grounds that one of the possible grounds upon which the judgment could have been rendered was not challenged. In such instances, “we must uphold the summary judgment” said the Court, citing Krueger v. Atascosa Cnty., 155 S.W.3d 614, 621 (Tex. App.—San Antonio 2004, no pet.) (“Unless an appellant has specifically challenged every possible ground for summary judgment, the appellate court need not review the merits of the challenged ground and may affirm on an unchallenged ground.”); Lowe v. Townview Watersong, L.L.C., 155 S.W.3d 445, 447 (Tex. App.—Dallas 2004, no pet.) (“Because summary judgment may have been granted on the unchallenged no-evidence grounds, we must affirm the trial court’s summary judgment.”). Ultimately, the Court concluded that “the no-evidence grounds raised in Albin’s hybrid motion for summary judgement could, if meritorious, fully support the judgment…”
The facts and trial court’s ruling in the case, however, are worth review: 
Bakke, a real estate development firm, contacted the Albins to discuss the prospect of a joint venture to develop real property in Boerne that the Albins had inherited. Under the proposal, the Albins were to dedicate their land to the venture, and Bakke would contribute finances and development expertise. The ultimate objective was to develop the property for apartment and mixed-use.
The parties never signed a written partnership agreement or otherwise  signed any writing embodying the terms of the the alleged oral agreement. Rather, it appears that both parties employed lawyers for the purpose of negotiating the terms of a limited partnership agreement, but ultimately reached an impasse. After the negotiations were terminated, Bakke filed suit on Kendall County District Court alleging that there was already an oral general partnership that achieved the same ends as would have the limited partnership that could not be negotiated, that Albin had breached the fiduciary duty owed to Bakke, constructive trust, fraud, unjust enrichment, and promissory estoppel.

The trial court granted Albin’s “Motion for Partial Summary Judgment on Applicability of the Statute of Frauds” and adjudged that “the Texas ‘statute of frauds,’ Texas Business and Commerce Code Section 26.01, applies to the oral agreement alleged by the Plaintiff in this cause and prohibits judicial enforcement of that agreement under any theory or cause of action for which the statute of frauds is a defense recognized under law.”  Bakke later amended its claims in the suit, and Albin then filed a hybrid motion for summary judgment, asserting that the agreement was unenforceable as a matter of law, and that there was no evidence to support Bakke Corp.’s claims for breach of the partnership agreement, breach of fiduciary duty, fraud, constructive trust, and unjust enrichment. This MSJ, too, was granted by the trial court.
On appeal, Bakke failed to challenge the no-evidence basis of the trial court’s grant of Albin’s hybrid MSJ.  As described above, this defect in the appeal resulted in a technical victory for Albin without the fourth Court addressing the merits of the parties’ arguments.
While — after reading the parties’ briefs — this commentator believes that the Court reached the right decision. However, the Court passed a golden opportunity to expound-upon and clarify the “Partial Performance Exception” to the Statute of Frauds, as it relates to agreements for the conveyance of real estate. 

Under that exception, if an agreement involves an oral (non-written) conveyance of land, it may be removed from the Statute of Frauds upon proof of: 1) payment of consideration; 2) possession by vendee that is exclusive and adverse to the owner of title of the land; and 3) the making of valuable improvements upon the land without consent of the conveying party. Carpenter v. Phelps, 391 S.W. 3d 143, 149 (Tex. App.—Houston [1st Dist.] 2011, no pet.); see also Pappas v. Gounaris, 311 S.W.2d 644, 646 (Tex. 1958). While Bakke alleged facts that might have fit into that exception, the Court never reached the exception issue, and we’ll have to wait for another day for a new case clarifying the exception.

Curated by Texas Bar Today. Follow us on Twitter @texasbartoday.

from Texas Bar Today
via Abogado Aly Website

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