Affirmed, in Part, and Reversed and =
Remanded, in=20
Part, and Opinion filed December 12, 2006.
In The
Fourteenth=20
Court of Appeals
____________
NO. 14-05-00498-CV
____________
FOUR=20
BROTHERS BOAT WORKS, INC., COLUMBIA STAR, INC.,
and BILLY B.,=20
INC.,=20
Appellants
V.
TESORO=20
PETROLEUM COMPANIES, INC., TESORO MARINE SERVICES, INC., and =
COASTWIDE=20
MARINE SERVICES, INC., =
Appellees
On Appeal from the =
10th District Court
Galveston County, =
Texas
Trial Court Cause =
No. 98CV0396
O P I N I=20
O N
Appellants,=20
Four Brothers Boat Works, Inc., Columbia Star, Inc., and Billy B., =
Inc.,=20
appeal the summary judgment entered in favor of appellees, Tesoro=20
Petroleum Companies, Inc., Tesoro Marine Services, Inc., and =
Coastwide=20
Marine Services, Inc. (collectively, ATesoro@), on=20
their claims for breach of contract, violations of the Deceptive =
Trade=20
Practices Act (ADTPA@),=20
conspiracy to commit DTPA violations, conspiracy to commit =
tortious=20
interference of a contract, fraud, breach of fiduciary duty, and =
third=20
party beneficiary. We affirm, in part, and reverse and =
remand, in=20
part.
I. =20
Background
On=20
February 6, 1975, Galveston Yacht Basin, Inc. leased a 15.422 acre =
tract=20
of land on the Galveston Ship Channel to Joe Grasso & Son, =
Inc. (the=20
AMaster=20
Lease@). =20
The primary term of the Master Lease began on May 1, 1977, and was =
to end=20
on April 30, 1987. The Master Lease also provided the tenant =
with=20
two ten-year options for extending the lease through April 30,=20
1997:
[Tenant] shall have =
the=20
option of extending the term of this Lease for an additional term =
of ten=20
(10) years, commencing on the 1st day of May 1987 and ending on =
the 30th=20
day of April. 1997, and [Tenant] shall be deemed to have exercised =
this=20
option, unless [Tenant] shall give notice to [Landlord] not less =
than six=20
months before the expiration of the primary term of the=20
[Tenant=3Ds] election not to =
exercise=20
such option.
=
; =
&=
nbsp; &n=
bsp; =20
* =20
* *
In like=20
manner and under like conditions, [Tenant] shall have the right, =
option=20
and privilege of further extending the term of this Lease for a =
second=20
additional term of ten (10) years commencing on the 1st day of May =
1997=20
and ending on the 30th day of April, 2007.
On May 1,=20
1977, Grasso entered into a sublease with Wallace Trochesset for a =
portion=20
of the property. On January 1, 1980, Trochesset assigned the =
sublease to Four Brothers (the AFour=20
Brothers sublease@). =20
The Four Brothers sublease provided that the subtenant would have =
a=20
primary term of ten years, beginning on May 1, 1977, and ending on =
April=20
30, 1987. The Four Brothers sublease further provided, at =
the end of=20
the primary term, the subtenant had two ten-year options for =
extending the=20
lease through April 30, 2007.
On=20
February 16, 1987, Grasso (then known as Grasso Oilfield Services, =
Inc.)=20
entered into a sublease with Columbia Star, Inc. for another =
portion of=20
the premises (the AColumbia=20
Star sublease@). =20
The Columbia Star sublease provided that the subtenant would have =
a=20
primary term of ten years, from May 1, 1987 to April 30, =
1997. The=20
Columbia Star sublease further provided, at the end of the primary =
term,=20
the subtenant with a ten-year option for extending the sublease =
through=20
April 30, 2007.
On March=20
7, 1991, Galveston Yacht Basin and Grasso entered into an =
amendment of the=20
Master Lease. The Amendment provided the Master Lease would=20
terminate on April 30, 1997, and that Grasso would Anot have=20
any right, option or privilege to extend the term of the Grasso =
Lease=20
beyond such date.@ In=20
1993, S&SF, Inc. purchased the properties owned by Galveston =
Yacht=20
Basin and became successor to Galveston Yacht Basin. At some =
point,=20
Tesoro acquired Grasso=3Ds=20
successor, Coastwide, thereby acquiring the Master Lease. =20
In April=20
1998, S&SF demanded that Four Brothers and Columbia Star =
vacate the=20
premises. On April 30, 1998, Four Brothers and Columbia Star =
filed a=20
declaratory judgment action against S&SF asking the trial =
court to=20
determine the then Acurrent=20
owners of the leasehold interests in the premises located at Pier=20
7@ =
and to=20
declare that the Master Amendment did not divest Four Brothers and =
Columbia Star of their interest in the leased premises and such =
interest=20
extends to 2007 in accordance with the original Master =
Lease. =20
S&SF=20
filed a counterclaim for trespass to try title and a declaratory =
judgment=20
that Four Brothers and Columbia Star: (1) were holdover tenants; =
(2) had=20
no equitable right, title, or interest in the property; (3) had no =
right=20
to compel their lessor (Grasso/Tesoro) to exercise a renewal =
option in the=20
Master Lease; and (4) their right of possession terminated upon =
expiration=20
of the Master Lease on April 30, 1997. =
S&SF=20
and Four Brothers and Columbia Star filed cross motions for =
summary=20
judgment on the issue regarding who had the right to possess the =
Pier 7=20
property until 2007. The trial court granted =
S&SF=3Ds motion=20
for summary judgment, denied Four Brothers and Columbia =
Star=3Ds motion,=20
and determined S&SF had a superior right to possession. =
The=20
trial court conclusively found: (1) S&SF was entitled to sole=20
possession of the property; (2) Four Brothers and Columbia Star =
had=20
neither a vested right of occupancy nor a leasehold interest =
therein; and=20
(3) S&SF was the owner of the property, and was entitled to=20
possession. The trial court severed the claims related to =
possession=20
of the property and Four Brothers and Columbia Star appealed that=20
judgment, which the First Court of Appeals affirmed. See =
Four=20
Bros. Boat Works, Inc. v. S & SF, Inc., 55 S.W.3d 12 (Tex. =
App.CHouston=20
[1st Dist.] 2001, pet. denied). Four Brothers and Columbia =
Star were=20
required to vacate Pier 7 by December 11, 2001.
Four=20
Brothers and Columbia Star brought claims for breach of contract,=20
violations of the Deceptive Trade Practices Act (ADTPA@),=20
conspiracy to commit DTPA violations, conspiracy to commit =
tortious=20
interference of a contract, fraud, breach of fiduciary duty, and =
third=20
party beneficiary. Another entity related to Four=20
BrothersCBilly=20
BCalso=20
brought a claim against Tesoro for violations of the DTPA. =20
Litigation on appellants=3D =
claims=20
against Tesoro continued. =20
Four Brothers and Columbia Star moved for partial summary judgment =
on=20
their breach of contract claims against Tesoro. Tesoro moved =
for=20
summary judgment on all of Four Brothers=3D, Columbia=20
Star=3Ds, and=20
Billy B=3Ds=20
claims. The trial court granted summary judgment in favor of =
Tesoro=20
on all of appellants=3D =
claims=20
and denied Four Brothers and Columbia Star=3Ds motion=20
for partial summary judgment on their breach of contract =
claims. =20
Appellants appeal the trial court=3Ds granting=20
Tesoro=3Ds motion=20
for summary judgment on all of their claims and the denial of Four =
Brothers and Columbia Star=3Ds partial=20
motion for summary judgment on their breach of contract claim. =
II. =20
Breach of Contract
In their=20
first issue, appellants claim the trial court erred in granting=20
Tesoro=3Ds motion=20
for summary judgment on Four Brothers=3D =
and=20
Columbia Star=3Ds breach=20
of contract claims and denying Four Brothers and Columbia =
Star=3Ds motion=20
for partial summary judgment on their breach of contract =
claims. =20
To prevail=20
on a motion for summary judgment, the movant must establish that =
no=20
material fact issue exists and that it is entitled to judgment as =
a matter=20
of law. Browning v. Prostok, 165 S.W.3d 336, 344 =
(Tex.=20
2005). In conducting our review of the summary judgment, we =
take as=20
true all evidence favorable to the nonmovant, and make all =
reasonable=20
inferences in the nonmovant=3Ds=20
favor. Diversicare Gen. Partner, Inc. v. Rubio, 185 =
S.W.3d=20
842, 846 (Tex. 2005). A defendant, as movant, is entitled to =
summary=20
judgment if it either disproves at least one essential element of =
each of=20
the plaintiff=3Ds causes=20
of action or establishes all the elements of an affirmative =
defense. =20
American Tobacco Co. v. Grinnell, 951 S.W.2d 420, 425 (Tex. =
1997). When both parties file motions for summary judgment =
seeking a=20
final judgment in their favor, we must determine all questions =
presented=20
and render judgment. SAS Inst., Inc. v. Breitenfeld, =
167=20
S.W.3d 840, 841 (Tex. 2005) (per curiam).
A. =20
Law of the Case
Tesoro=20
argued in its motion for summary judgment that the law of the case =
doctrine applied here to preclude Four Brothers=3D =
and=20
Columbia Star=3Ds claims=20
for breach of contract because the question of law presented in =
the=20
Four Brothers I appeal directly disposes of those =
claims. The=20
Alaw of the=20
case@ =
doctrine=20
is defined as that principle under which questions of law decided =
on=20
appeal to a court of last resort will govern the case throughout =
its=20
subsequent stages. Hudson v. Wakefield, 711 S.W.2d =
628, 630=20
(Tex. 1986). It applies only to questions of law, not =
questions of=20
fact. Id.
Tesoro=20
argues the Four Brothers I holding is dispositive of Four=20
Brothers=3D =
and=20
Columbia Star=3Ds claims=20
that it breached the contract by failing to provide the leased =
premises=20
for the 1997B2007=20
period. Tesoro asserts that, out of necessity, the Four =
Brothers=20
I opinion directly addressed Four Brothers=3D =
and=20
Columbia Star=3Ds claims=20
for breach of contract, when it held that A[w]hile=20
their respective subleases gave Four Brothers and Columbia Star =
the right=20
to extend their subtenancies while the Master Lease was in effect, =
that=20
right to extend terminated when Grasso Oilfield [Tesoro] lawfully=20
terminated the Master Lease.@ =20
Four Bros. Boatworks, Inc., 55 S.W.3d at 17. =
Therefore,=20
according to Tesoro, once the Master Lease terminated, it had no=20
obligation to Four Brothers or Columbia Star under the subleases =
and it is=20
the Avery same=20
right to renew the subleases that is now at issue in this=20
case.@ =20
The=20
original dispute between Four Brothers and Columbia Star and =
S&SF=20
concerned possession of the leased premises. In the =
declaratory=20
judgment proceeding, Four Brothers and Columbia Star requested =
that the=20
trial court:
(1) determine the =
leasehold=20
interests in the premises located at Pier 7;
(2) declare that =
Four=20
Brothers and Columbia Star were the owners of the leasehold =
interests of=20
the premises located at Pier 7 under the subleases; and
(3)=20
declare that the Master Amendment did not divest Four Brothers and =
Columbia Star of their interest in the leased premises and that =
such=20
interest extended to 2007 in accordance with the original Master=20
Lease.
S&SF=20
counterclaimed for declaratory relief as to the issue of =
possession, as=20
well. Four Brothers and Columbia Star and S&SF filed =
competing=20
motions for summary judgment solely on the issue of who was =
entitled to=20
possession. No other claims were addressed in the motions =
for=20
summary judgment. In granting summary judgment in favor of =
S&SF=20
on the issue of possession, the trial court specifically found, as =
a=20
matter of law:
Four Brothers Boat =
Works,=20
Inc. and Columbia Star, Inc. do not have a vested right of =
occupancy or=20
current leasehold interest in the contested tract of land. =20
S&SF,=20
Inc. is the owner of the contested tract and is entitled to=20
possession.
In the=20
Four Brothers I appeal, the First Court of Appeals stated =
it was=20
reviewing whether the Master Lease had been voluntarily =
surrendered, and=20
whether Four Brothers=3D =
and=20
Columbia Star=3Ds rights=20
of possession had vested when the Master Lease and subleases were=20
extended. Four Brothers Boatworks, Inc., 55 S.W.3d at =
13B14. =20
The First Court of Appeals affirmed the trial court=3Ds judgment=20
awarding possession to S&SF. Id. at 18. =20
Thus, the=20
issue in Four Brothers I concerned the right of possession =
as=20
between the sublessees (Four Brothers and Columbia Star) and the =
original=20
lessor (S&SF). The Four Brothers I court based =
its=20
holding that the trial court correctly awarded possession to =
S&SF on=20
the lack of privity between the sublessees and the original =
lessor. =20
This is confirmed by the court=3Ds holding=20
that A[b]ecause=20
Four Brothers and Columbia Star were mere sublessees, rather =
than=20
assignees, they had no right to extend the Master Lease =
[between=20
Tesoro and the landlord] once it had terminated.@ =20
Id. at 17 (emphasis added). Neither the underlying=20
declaratory judgment nor the Four Brothers I appeal =
concerned=20
contractual rights as between the sublessees (Four Brothers and =
Columbia=20
Star) and the sublessor (Tesoro).
To the=20
extent that the Four Brothers I opinion addresses Four=20
Brothers=3D =
and=20
Columbia Star=3Ds breach=20
of contract claims against Tesoro, we find such statements to be =
merely=20
dicta. ADictum is=20
an observation or remark made concerning some rule, principle, or=20
application of law suggested in a particular case, which =
observation or=20
remark is not necessary to the determination of the =
case.@ =20
Edwards v. Kaye, 9 S.W.3d 310, 314 (Tex. App.CHouston=20
[14th Dist.] 1999, pet. denied) (citing Black=3Ds=20
Law Dictionary =
409 5th=20
ed. (1979)). The law of the case doctrine does not apply to=20
dicta. In re Certain Underwriters at =
Lloyd=3Ds, 18=20
S.W.3d 867, 870 (Tex. App.CBeaumont=20
2000, no pet.); In re Estate of Chavana, 993 S.W.2d 311, =
315 (Tex.=20
App.CSan=20
Antonio 1999, no pet.) (op. on reh=3Dg);=20
Huckabay v. Irving Hosp. Auth., 879 S.W.2d 64, 66 n.1 =
(Tex.=20
App.CDallas=20
1993, writ dism=3Dd by=20
agr.). =20
We=20
conclude the law of the case doctrine is not applicable here and, =
thus,=20
the First Court of Appeals=3Ds decision=20
in Four Brothers I does not foreclose Four =
Brothers=3D =
and=20
Columbia Star=3Ds claims=20
for damages against Tesoro for breach of the subleases.
B. =20
Terms of the Subleases
Having=20
determined that the law of the case doctrine does not preclude =
Four=20
Brothers=3D =
and=20
Columbia Star=3Ds breach=20
of contract claims against Tesoro, we now address =
appellants=3D =
argument=20
that Tesoro contractually obligated itself to provide the =
subleased=20
premises to Columbia Star for a term of 20 years and to Four =
Brothers for=20
a term of 30 years, until April 30, 2007. =
The=20
language of the Four Brothers and Columbia Star subleases =
unambiguously=20
provides Four Brothers and Columbia Star the option to extend the=20
respective subleases from 1997 until 2007. Those extensions =
were for=20
the benefit of Four Brothers and Columbia Star, were their right =
to=20
exercise, and were a valuable right for which they had =
bargained. =20
While Tesoro could freely terminate its relationship with =
S&SF, it was=20
not free to do so without potential liability for damages for =
failing to=20
deliver the premises to its own lessees for the years 1997 to =
2007. =20
Thus, the termination of the Master Lease has no effect on=20
Tesoro=3Ds=20
contractual obligation to Four Brothers or Columbia Star. =
See=20
Colorado Interstate Corp. v. CIT Group/Equip. Fin., Inc., 993 =
F.2d=20
743, 746B47 (10th=20
Cir. 1993) (citing Frankfurt v. Decker, 180 S.W.2d 985, 987 =
(Tex.=20
Civ. App.CDallas=20
1944, no writ)) (applying Texas law and holding =
sublessee=3Ds right of=20
possession vis-a-vis the original lessor is secondary because =
there is no=20
privity of contract between sublessee and original lessor, but =
obligations=20
under sublease do not cease upon termination of the prime lease =
and=20
sublessee=3Ds remedy=20
was action for damages against sublessor after termination of =
prime=20
lease).
Therefore,=20
we reject Tesoro=3Ds claim=20
that it was relieved of all contractual responsibilities to =
appellants=20
when the Master Lease terminated. Tesoro also argues, =
however, that=20
neither Four Brothers nor Columbia Star properly exercised their=20
respective renewal rights. However, this contention was =
raised in=20
response to appellants=3D =
motion=20
for partial summary judgment and, thus, is not an issue properly =
before=20
this court. Ordinarily, when both parties file motions for =
summary=20
judgment in the trial court, we determine all questions presented =
and=20
render judgment. SAS Inst., Inc., 167 S.W.3d at =
841. =20
However, before a court of appeals may reverse summary judgment =
for one=20
party and render judgment for the other party, both parties must=20
ordinarily have sought final judgment relief in their cross =
motions for=20
summary judgment. CU Lloyd=3Ds of Texas=20
v. Feldman, 977=20
S.W.2d 568, 569 (Tex. 1998). Here, appellants=3D =
motion=20
for partial summary judgment did not seek a final judgment. =20
Accordingly, we reverse the summary judgment granted in favor of =
Tesoro=20
against appellants on the issue of their breach of contract claim =
and=20
remand this claim to the trial court for disposition consistent =
with this=20
opinion. Accordingly, we sustain appellants=3D =
first=20
issue.
III. =20
Statute of Limitations
In their=20
second issue, appellants claim the trial court erred in granting =
summary=20
judgment on Billy B=3Ds claim=20
for DTPA violations on Tesoro=3Ds=20
affirmative defense of statute of limitations. When a =
defendant=20
moves for summary judgment on the affirmative defense of =
limitations, it=20
has the burden to conclusively establish that defense, including =
the=20
accrual date of the cause of action. Diversicare Gen. =
Partner,=20
Inc., 185 S.W.3d at 846. If the defendant establishes =
that the=20
statute of limitations bars the action, the plaintiff must adduce =
summary=20
judgment proof raising a fact issue in avoidance of the statute of =
limitations. Id.
A=20
plaintiff must bring its DTPA claims within two years after the =
date on=20
which the false, misleading, or deceptive act or practice occurred =
or=20
within two years after the plaintiff discovered or in the exercise =
of=20
reasonable diligence should have discovered the occurrence of the =
false,=20
misleading, or deceptive act or practice. Tex. Bus. & Com. Code =
Ann.=20
' =
17.565=20
(Vernon 2002).
Billy B, a=20
company related to Four Brothers, was not a sublessee, but =
operated its=20
business from Pier 7. Billy B filed its DTPA claims against =
Tesoro=20
on November 12, 2002. Tesoro argues Billy B would have had =
knowledge=20
that the Master Lease had terminated and its causes of action =
would have=20
accrued (1) in October 1997, when it first had knowledge of any =
claims;=20
(2) or, alternatively, in November 1997, when appellants were =
requested to=20
vacate the premises; (3) or, at the very latest, in April 1998, =
when=20
S&SF filed a forcible entry and detainer suit against Four =
Brothers=20
and Columbia Star. Thus, according to Tesoro, the latest =
Billy could=20
have brought its DTPA claims was April 2000, two and one half =
years before=20
Billy B actually filed its claims in November 2002. =
In support=20
of its motion for summary judgment on statute of limitations, =
Tesoro=20
submitted the deposition testimony of Richard Ryan, president of =
Four=20
Brothers, Columbia Star, and Billy B, who testified that Marc =
Cuenod of=20
S&SF contacted him around November 1, 1997, about=20
appellants=3D =
presence=20
on the premises. Tesoro also submitted the deposition =
testimony of=20
Marc Cuenod, who similarly testified that he contacted Richard =
Ryan in=20
November 1997. Thus, Billy B had knowledge by November 1997, =
that=20
Tesoro and S&SF had terminated the Master Lease. =20
Appellants=20
argue that, under the legal injury rule, Billy B=3Ds cause of=20
action did not accrue until after the exhaustion of all the =
appeals on the=20
issue of possession and Billy B=3Ds (along=20
with Four Brothers and Columbia Star) was required to vacate the =
premises=20
on December 11, 2001. See S.V. v. R.V., 933 S.W.2d 1, =
4 (Tex.=20
1996) (explaining that under the legal injury rule, a cause of =
action=20
accrues when a wrongful act causes an injury, even if the fact of =
the=20
injury is not discovered until later and all resulting damages =
have not=20
yet occurred). Appellants assert the appeals of the =
possession issue=20
with S&SF (Four Brothers I) operated as a Alegal=20
impediment,@ =
preventing Billy B from filing suit until the appellate process =
had been=20
exhausted. A[W]here a=20
person is prevented from exercising his legal remedy by the =
pendency of=20
legal proceedings, the time during which he is thus prevented =
should not=20
be counted against him in determining whether limitations have =
barred his=20
right.@ =20
Walker v. Hanes, 570 S.W.2d 534, 540 (Tex. Civ. =
App.CCorpus=20
Christi 1978, writ ref=3Dd=20
n.r.e.).
Appellants=20
assert that if Four Brothers and Columbia Star had been successful =
on=20
their appeal of the possession issue, Billy B would not have =
accrued any=20
cause of action against Tesoro because it would not have incurred =
any=20
losses from being removed from Pier 7. In support of their =
position,=20
appellants rely on Rogers v. Ricane Enterprises, Inc., =
which states=20
a statute of limitations is tolled for a second cause of action =
where (1)=20
the viability of the second cause of action necessarily depends on =
the=20
outcome of the first case, and (2) the pursuit of the =
second suit=20
prior to that outcome would either be improper or result in =
judicial=20
complications. 930 S.W.2d 157, 167 (Tex. App.CAmarillo=20
1996, writ denied). The court of appeals in Rogers =
relied on=20
the Texas Supreme Court=3Ds opinion=20
in the legal malpractice case of Hughes v. Mahaney & =
Higgins. =20
Id. The court in Hughes observed when an =
attorney=20
commits malpractice while providing legal services in the =
prosecution or=20
defense of a claim which results in litigation, the legal injury =
and=20
discovery rules can force the client into adopting inherently =
inconsistent=20
positions in the underlying case and the malpractice case; =
therefore, the=20
statute of limitations on the malpractice claim against the =
attorney is=20
tolled until all appeals on the underlying claim are =
exhausted. 821=20
S.W.2d at 156B57. =20
The supreme court has further made it clear that the Hughes =
rule=20
applies only to legal malpractice cases. See Murphy v.=20
Campbell, 964 S.W.2d 265, 272 (Tex. 1997) (reiterating that =
the court=20
had Aexpressly=20
limited@ =
the=20
tolling rule in Hughes to attorney malpractice, and =
declining to=20
extend it to accounting malpractice).
Billy B=20
was not a party to the litigation against S&SF in the =
possession=20
dispute and, therefore, there was no risk of Billy B=3Ds taking=20
conflicting positions. =20
Thus, we do not find the pending litigation and appeal of the =
possession=20
issue against S&SF to be a legal impediment tolling the =
statute of=20
limitations on Billy B=3Ds DTPA=20
claims against Tesoro. Appellants=3D =
second=20
issue is overruled.
IV. =20
Other =
Claims
In their=20
third issue, appellants contend the trial court erred in granting =
summary=20
judgment on their clams for violations of the DTPA, conspiracy to =
violate=20
the DTPA, conspiracy to tortiously interfere with the subleases, =
breach of=20
fiduciary duty, fraud, and breach of contract as a third party.=20
A. =20
DTPA
Appellants=20
allege under the DTPA that: (1)Tesoro breached the implied =
warranty=20
of quiet enjoyment of the premises;=20
(2) Tesoro=3Ds acts and=20
omissions constitute false, misleading, or deceptive acts or =
practices;=20
and (3) Tesoro=3Ds acts and=20
omissions constitute an unconscionable action or course of =
action.=20
1. =20
Breach of the Warranty of Quiet Enjoyment
Appellants=20
claim Tesoro breached the implied warranty of quiet enjoyment =
Aby=20
entering into the Master Amendment and attempting to extinguish =
the last=20
10 years of the term of the subleases and by not exercising the =
option to=20
extend the terms of the Master Lease.@ It=20
is well-settled that, in the absence of express language to the =
contrary,=20
there is an implied warranty that the lessee shall have the quiet =
and=20
peaceful enjoyment of the leased premises. L-M-S Inc. v.=20
Blackwell, 149 Tex. 348, 233 S.W.2d 286, 289 (1950); HTM =
Rests.,=20
Inc. v. Goldman, Sachs & Co., 797 S.W.2d 326, 328 (Tex.=20
App.CHouston=20
[14th Dist.] 1990, writ denied). Tesoro has cited no =
provision, and=20
we found none, in the Four Brothers and Columbia Star subleases=20
eliminating the implied warranty of quiet enjoyment. =20
The DTPA=20
provides a cause of action when the cause of damages is the breach =
of an=20
implied warranty. Tex. Bus.=20
& Com. Code Ann. ' =
17.50(a)(2). To recover for breach of warranty under the =
DTPA, the=20
plaintiff must show (1) consumer status, (2) existence of the =
warranty,=20
(3) breach of warranty, and (4) the breach was a producing cause =
of=20
damages. Elliott v. Kraft Foods N. Am. Inc., 118 =
S.W.3d 50,=20
56 (Tex. App.CHouston=20
[14th Dist.] 2003, no pet.). The DTPA does not create =
warranties;=20
instead, they must be established independently of the act. =
La=20
Sara Grain Co. v. First Nat=3Dl=20
Bank, 673=20
S.W.2d 558, 565 (Tex. 1984); Elliott, 118 S.W.3d at =
56. An=20
implied warranty is derived from either statute or from common =
law. =20
La Sara Grain Co., 673 S.W.2d at 565. AImplied=20
warranties are created by operation of law and are grounded more =
in tort=20
than in contract.@ =20
Id.
Relying on=20
well-settled Texas law that an allegation of breach of contract, =
without=20
more, does not constitute a false, misleading, or deceptive act in =
violation of the DTPA,=20
Tesoro contends appellants=3D =
breach of=20
warranty claims are merely breach of contract claims and, =
therefore, is=20
not actionable under the DTPA. Specifically, Tesoro argues =
that Four=20
Brothers=3D =
and=20
Columbia Star=3Ds claims=20
for the breach of the implied warranty to quiet enjoyment are =
essentially=20
complaints of Tesoro=3Ds failure=20
to perform under the sublease, i.e., failure to deliver the =
premises to=20
appellants for the period of April 1997 to April 2007. =
However, a=20
claim for breach of warranty is separate from a claim for false,=20
misleading, or deceptive acts. See Continental Dredging, =
Inc. v.=20
De-Kaizered, Inc., 120 S.W.3d 380, 391 (Tex. App.CTexarkana=20
2003, pet. denied) (ABecause=20
implied warranties are grounded more in tort, and because the DTPA =
expressly recognizes breach of an implied warranty as a separate =
violation=20
from misrepresentations, [appellant] may have violated the DTPA if =
it=20
breached an implied warranty, despite not making any actionable=20
misrepresentations outside the contract.@). =20
Moreover, Aa consumer=20
is not prevented from bringing a DTPA action against a defendant =
merely=20
because the defendant also breached a contract.@ =20
Nasrallah v. Ordonez, No. 2-04-137-CV, 2005 WL 1791985, at =
*3 (Tex.=20
App.CFort Worth=20
July 28, 2005, no pet.) (mem. op.).
Tesoro=20
further asserts that under the law of the case doctrine, =
appellants had no=20
right to extend their subleases beyond April 1997, when the Master =
Lease=20
terminated and the implied covenants of quiet enjoyment expired =
with the=20
termination of the subleases. As previously addressed, the =
law of=20
the case doctrine does not apply to appellants=3D =
claims=20
for damages against Tesoro. We conclude the trial court =
erred in=20
granting summary judgment on Four Brothers=3D =
and=20
Columbia Star=3Ds claims=20
for breach of an implied warranty under the DTPA. We sustain =
appellants=3D =
third=20
issue with regard to the claims for breach of the implied warranty =
of=20
quiet enjoyment under the DTPA.
2. =20
False, Misleading, or Deceptive Acts/Unconscionable Action or =
Course of=20
Action
Appellants=20
also allege Tesoro=3Ds failure=20
to inform Four Brothers and Columbia Star of changes made by the =
Master=20
Amendment, Athereby=20
attempting to excise from the Master Lease the final 10 years of =
the=20
subleases,@ =
constitutes false, misleading, or deceptive acts or practices and =
an=20
unconscionable action or course of action. See Tex. Bus. & Com. Code =
Ann.=20
'' =
17.46(b)(12) (false, misleading, or deceptive acts); 17.50(a)(3)=20
(unconscionable action or course of action). Tesoro argued =
in its=20
motion for summary judgment that the law of the case doctrine =
precludes=20
these DTPA claims because it lawfully terminated the master =
lease. =20
As previously addressed, the law of the case doctrine does not =
apply here=20
to preclude damage claims against Tesoro. Tesoro raised no =
other=20
grounds on which to grant summary judgment on these DTPA =
claims. =20
Because the law of the case doctrine does not apply here, the =
trial court=20
erred in granting summary judgment on these DTPA claims. We =
sustain=20
appellants=3D =
third=20
issue with regard to the claims for false, misleading, or =
deceptive acts,=20
and unconscionable action or course of action under the =
DTPA. =20
B. =20
Conspiracy
Appellants=20
allege Tesoro conspired with S&SF and Galveston Yacht Basin to =
violate=20
the DTPA and to tortiously interfere with Four =
Brothers=3D =
and=20
Columbia Star=3Ds business=20
relationships. A civil conspiracy involves a combination of =
two or=20
more persons with an unlawful purpose or a lawful purpose to be=20
accomplished by unlawful means. Ernst & Young, L.L.P. =
v.=20
Pacific Mut. Life Ins. Co., 51 S.W.3d 573, 583 (Tex. =
2001). The=20
elements of conspiracy are (1) two or more persons; (2) an object =
to be=20
accomplished; (3) a meeting of minds on the object or course of =
action;=20
(4) one or more unlawful, overt acts; and (5) damages as the =
proximate=20
result. Operation Rescue-Nat=3Dl v.=20
Planned Parenthood of Houston & S.E. Tex., =
Inc., 975=20
S.W.2d 546, 553 (Tex. 1998).
1. =20
Conspiracy to Violate DTPA
Appellants=20
allege Tesoro conspired with Galveston Yacht Basin and S&SF to =
violate=20
the DTPA. Two or more persons can be held liable for a =
conspiracy to=20
violate the DTPA. Laxson v. Giddens, 48 S.W.3d 408, =
411 (Tex.=20
App.CWaco 2001,=20
pet. denied). In its motion for summary judgment, Tesoro =
argued the=20
law of the case doctrine governs Four Brothers=3D =
and=20
Columbia Star=3Ds claims=20
for conspiracy to violate the DTPA because Four Brothers I=20
determined that Tesoro lawfully terminated the Master Lease. =
Appellants argue the lawful termination of the Master Lease has no =
effect=20
on Tesoro=3Ds=20
obligation with regard to the subleases. As previously =
addressed,=20
the law of the case doctrine does not apply here. Tesoro =
raised no=20
other grounds in support of its motion for summary judgment on =
Four=20
Brothers=3D =
and=20
Columbia Star=3Ds claims=20
for conspiracy to violate the DTPA. Therefore, the trial =
court erred=20
in granting summary judgment Four Brothers=3D =
and=20
Columbia Stars=3D =
claims=20
for conspiracy to violate the DTPA. We sustain=20
appellants=3D =
third=20
issue with regard to the claims for conspiracy to violate the =
DTPA.=20
2. =20
Conspiracy to Commit Tortious Interference
Appellants=20
allege Tesoro conspired with S&SF and Galveston Yacht Basin to =
interfere with its contractual relations with Four Brothers and =
Columbia=20
Star. Appellants, however, did not allege a tortious =
interference=20
claim against Tesoro.
There is=20
no independent liability for civil conspiracy. Deaton v. =
United=20
Mobile Networks, L.P., 926 S.W.2d 756, 760 (Tex. =
App.CTexarkana=20
1996), aff=3Dd, in=20
part, rev=3Dd, in=20
part, on other grounds, 939=20
S.W.2d 146 (Tex. 1997) (per curiam). Therefore, because a=20
defendant=3Ds=20
liability depends upon its participation in some underlying tort =
for which=20
the plaintiff seeks to hold the defendant liable, conspiracy is =
considered=20
a derivative tort. Tilton v. Marshall, 925 S.W.2d =
672, 681=20
(Tex. 1996). An actionable conspiracy must consist of acts =
which=20
would have been actionable against the conspirators =
individually. =20
International Bankers Life Ins. Co. v. Holloway, 368 S.W.2d =
567,=20
581 (Tex. 1963). Thus, to prevail on a civil conspiracy =
claim, the=20
plaintiff must show the defendant was liable for some underlying=20
tort. Hunt v. Baldwin, 68 S.W.3d 117, 133 (Tex.=20
App.CHouston=20
[14th Dist.] 2001, no pet.).
The=20
elements of tortious interference with a contract are (1) an =
existing=20
contract subject to interference, (2) a willful and intentional =
act of=20
interference with the contract, (3) that proximately caused the=20
plaintiff=3Ds injury,=20
and (4) caused actual damages or loss. Prudential Ins. =
Co. of Am.=20
v. Financial Review Servs., Inc., 29 S.W.3d 74, 77 (Tex. =
2000). =20
Liability for tortious interference is based on the acts of an =
interfering=20
third party. Central Savs. & Loan =
Ass=3Dn v.=20
Stemmons N.W. Bank, N.A., 848=20
S.W.2d 232, 241 (Tex. App.CDallas=20
1992, no writ); Schoellkopf v. Pledger, 778 S.W.2d 897, 902 =
(Tex.=20
App.CDallas=20
1989, writ denied). Therefore, a party cannot tortiously =
interfere=20
with its own contract. Hussong v. =
Schwan=3Ds Sales=20
Enters., Inc., 896=20
S.W.2d 320, 326 (Tex. App.CHouston=20
[1st Dist.] 1995, no writ) (op. on reh=3Dg);=20
Schoellkopf, 778 S.W.2d at 902. Because Tesoro cannot =
be=20
liable for tortiously interfering with its subleases with Four =
Brothers=20
and Columbia Star, it cannot be liable for conspiracy to =
tortiously=20
interfere with the subleases. The trial court properly =
granted=20
summary judgment on this claim. =20
Appellants=3D =
third=20
issue with regard to conspiracy to commit tortious interference is =
overruled.
C. =20
Fiduciary Duty
Appellants=20
assert the trial court erred in granting summary judgment on Four=20
Brothers=3D =
and=20
Columbia Star=3Ds claims=20
for breach of fiduciary duty. There are two types of =
fiduciary=20
relationships. The first is a formal fiduciary relationship, =
which=20
arises as a matter of law, and includes the relationships between =
attorney=20
and client, principal and agent, partners, and joint =
venturers. =20
Insurance Co. of N. Am. v. Morris, 981 S.W.2d 667, 674 =
(Tex.1998)=20
(attorney-client, partnership, trustee); Hoggett v. Brown, =
971=20
S.W.2d 472, 487 (Tex. App.CHouston=20
[14th Dist.] 1997, pet. denied) (principal/agents; partners);=20
Miller‑Rogaska, Inc. v. Bank One, Tex., N.A., 931 =
S.W.2d 655, 663=20
(Tex. App.CDallas=20
1996, no writ) (attorney-client, partners, joint venturers). =
The second=20
is an informal fiduciary relationship, which may arise from =
Aa moral,=20
social, domestic or purely personal relationship of trust and =
confidence,=20
generally called a confidential relationship.@ =20
Associated Indem. Corp. v. CAT Contracting, Inc., 964 =
S.W.2d 276,=20
287 (Tex.1998). A confidential relationship exists in cases =
in which=20
A>influence=20
has been acquired and abused, in which confidence has been reposed =
and=20
betrayed.=3D@ =20
Id. (quoting Crim. Truck & Tractor Co. v. Navistar=20
Int=3Dl Transp.=20
Corp., 823=20
S.W.2d 591, 594 (1992)).
Appellants=20
do not argue the existence of a formal relationship, but, instead, =
argue=20
the existence of an informal fiduciary relationship. =
Appellants=20
argue Tesoro undertook to protect the subtenants in the Master =
Lease by=20
providing for notification to the subtenant by the landlord of any =
defaults by the tenant and providing the subtenant with the right =
to cure=20
any such defaults by the tenant. In support of this =
position,=20
appellants assert one who voluntarily enters an affirmative course =
of=20
action affecting the interests of another is regarded as assuming =
a duty=20
to act and must do so with reasonable care. One of the cases =
upon=20
which appellants rely states the well-settled rule, which is based =
on=20
Section 323 of the Restatement (Second) of Torts, as Aone who=20
voluntarily undertakes an affirmative course of action for the =
benefit of=20
another has a duty to exercise reasonable care that the =
other=3Ds person=20
or property will not be injured thereby.@ =20
Colonial Savs. Ass=3Dn v.=20
Taylor, 544=20
S.W.2d 116, 119 (Tex. 1976). =20
Section 323 applies to a cause of action for negligence involving =
injury=20
to a person or property. We find nothing in Section 323 that =
creates=20
a fiduciary duty between parties.
To impose=20
an informal fiduciary duty in a business transaction, the =
requisite=20
special relationship of trust and confidence must exist prior to, =
and=20
apart from, the agreement made the basis of the suit. =
Associated=20
Indem. Corp., 964 S.W.2d at 288; Schlumberger Tech. Corp. =
v.=20
Swanson, 959 S.W.2d 171, 177 (Tex.1997). Specifically, a =
confidential relationship can arise, if, over a long period of =
time, the=20
parties have worked together in the joint acquisition and =
development of=20
property before entering the agreement sought to be =
enforced. =20
Consolidated Gas & Equip. Co. of Am. v. Thompson, 405 =
S.W.2d=20
333, 336B37=20
(Tex.1966); Exploration Co. v. Vega Oil & Gas Co., 843 =
S.W.2d=20
123, 126B27 (Tex.=20
App.CHouston=20
[14th Dist.] 1992, writ denied).
The fact=20
that a business relationship has been cordial and of extended =
duration is=20
not by itself evidence of a confidential relationship. =
Thigpen v.=20
Locke, 363 S.W.2d 247, 253 (Tex.1962); Farah v. Mafrige =
&=20
Kormanik, P.C., 927 S.W.2d 663, 675 (Tex. App.CHouston=20
[1st Dist.] 1996, no writ). Likewise, the fact that one =
businessman=20
trusts another and relies on another to perform a contract does =
not give=20
rise to a confidential relationship. Crim Truck & =
Tractor=20
Co., 823 S.W.2d at 594; Seymour v. American Engine & =
Grinding=20
Co., 956 S.W.2d 49, 60 (Tex. App.CHouston=20
[14th Dist.] 1996, writ denied). Subjective trust is simply =
not=20
sufficient to transform an arms‑length transaction into a =
fiduciary=20
relationship. Schumberger Tech. Corp., 959 S.W.2d at =
177;=20
Farah, 927 S.W.2d at 676.
To=20
determine the existence of a confidential or fiduciary =
relationship, a=20
court must examine the actualities of the relationship between the =
parties=20
involved. Thigpen, 363 S.W.2d at 253; Turner v. =
Church of=20
Jesus Christ of Latter‑Day Saints, 18 S.W.3d 877, 897 =
(Tex.=20
App.CDallas=20
2000, pet. denied). Although the existence of a confidential =
relationship can be a question of fact, where there is no evidence =
to=20
establish the relationship, it is a question of law. See=20
Miller‑Rogaska, Inc., 931 S.W.2d at 663 (citing Crim =
Truck &=20
Tractor Co., 823 S.W.2d at 594) (affirming granting of summary =
judgment on plaintiff=3Ds claim=20
for breach of fiduciary duty on basis that there was no summary =
judgment=20
evidence to suggest existence of fiduciary relationship); =
Farah,=20
927 S.W.2d at 675 (same).
Appellants=20
have not shown any relationship with Tesoro prior to entering =
their=20
respective subleases, which are the subject matter of this =
litigation,=20
i.e., that the parties have worked together in the joint =
acquisition and=20
development of property before entering the agreement sought to be =
enforced. Nor have appellants shown that this is anything =
but an=20
arms-length transaction. See Cambridge Oil Co. v. =
Huggins,=20
765 S.W.2d 540, 544 (Tex. App.CCorpus=20
Christi 1989, writ denied) (AThe=20
relationship between a lessor and a lessee is purely contractual =
absent=20
some other special relationship created between the =
parties.@). =20
We conclude no informal fiduciary relationship exists between =
appellants=20
and Tesoro. In the absence of either a formal or informal =
fiduciary=20
relationship, the trial court properly granted summary judgment on =
Four=20
Brothers=3D =
and=20
Columbia Star=3Ds claims=20
for breach of a fiduciary duty. Appellants=3D =
third=20
issue with regard to breach of fiduciary duty is overruled. =20
D. =20
Fraud
Appellants=20
contend the trial court erred in granting summary judgment on Four =
Brothers=3D =
and=20
Columbia Star=3Ds claims=20
for fraud based on Tesoro=3Ds failure=20
to inform them of the termination of the Master Lease. To =
recover on=20
an action for fraud, the plaintiff must prove (1) a material=20
representation was made, (2) the representation was false, (3) =
when the=20
speaker made the representation, he knew it was false or made it=20
recklessly without knowledge of the truth as a positive assertion, =
(4) the=20
speaker made it with the intention that it should be acted upon by =
the=20
party, (5) the party acted in reliance upon it, and (6) the party =
thereby=20
suffered injury. Johnson & Higgins of Tex., Inc. v. =
Kenneco=20
Energy, Inc., 962 S.W.2d 507, 524 (Tex. 1998). Fraud by =
omission=20
is a subcategory of fraud because the omission or non-disclosure =
may be as=20
misleading as a positive misrepresentation of fact where a party =
has a=20
duty to disclose. Manon v. Solis, 142 S.W.3d 380, 387 =
(Tex.=20
App.CHouston=20
[14th Dist.] 2004, pet. denied). A failure to disclose does =
not=20
constitute fraud unless there is a duty to disclose the =
information. =20
Ins. Co. of N. Am., 981 S.W.2d at 674; Hoggett, 971 =
S.W.2d=20
at 487.
Tesoro=20
raised two arguments in support of its motion for summary judgment =
on Four=20
Brothers=3D =
and=20
Columbia Star=3Ds claims=20
for fraud: (1) it had no duty to disclose any information to them =
in the=20
absence of a confidential or fiduciary relationship; and (2) it =
did not=20
intend to induce them to take action on a 30-year lease =
term. =20
With=20
respect to Tesoro=3Ds first=20
argument, the existence of a confidential relationship is not the =
only=20
basis on which to impose a duty to disclose information. =20
Anderson, Greenwood & Co. v. Martin, 44 S.W.3d 200, 212 =
(Tex.=20
App.CHouston=20
[14th Dist.] 2001, pet. denied). A duty to disclose may also =
arise=20
in the three following situations: (1) when one voluntarily =
discloses=20
information, he has a duty to disclose the whole truth; (2) when =
one makes=20
a representation, he has a duty to disclose new information when =
he is=20
aware the new information makes the earlier representation =
misleading or=20
untrue; and (3) when one makes a partial disclosure and conveys a =
false=20
impression, he has a duty to speak. Id. at =
212B13. Here,=20
appellants allege that when the Master Lease was terminated, =
foreclosing=20
Four Brothers=3D =
and=20
Columbia Star=3Ds=20
possession after April 1997, Tesoro knew new information making an =
earlier=20
representation untrue and, therefore, had a duty to disclose such=20
information to Four Brothers and Columbia Star. =20
With=20
respect to its second argument, Tesoro never produced any summary =
judgment=20
evidence on the intent element. In its motion for summary =
judgment,=20
it merely denied that it intended to induce Four Brothers and =
Columbia=20
Star to take any action. However, this is not sufficient to =
refute=20
the element of intent. Cf. Hendricks v. Thornton, 973 =
S.W.2d=20
348, 358 (Tex. App.CBeaumont=20
1998, pet. denied) (Athe mere=20
denial of intent by an interested witness is not enough to negate =
the=20
element of intent to induce reliance@). =20
|