The only issue before the Court in this case was whether the trial court erred in denying the defendant’s motion to compel arbitration.  The plaintiffs signed up to be Independent Representatives (apparently, a type of sales rep) for the defendants.  As part of the online application process, plaintiffs clicked a box confirming that they agreed to the defendant’s terms and conditions.  Those terms and conditions contained a provision providing that any dispute between the parties would be resolved by binding arbitration.

It turns out that the Court recently upheld the exact same arbitration provision in a case against the same defendants.  Consequently, without much substantive analysis, the Court referenced its prior opinion and reversed the trial court, holding that there was a valid agreement to arbitrate between the parties.

Momentis U.S. Corp. v. Perissos Holdings Inc.

A builder sued the prospective buyers of a townhome for breach of contract and fraud after they backed out of the sale before closing. The Court of Appeals affirmed a jury verdict for the buyers. The seller’s first issue on appeal was simply that “the evidence demonstrates [buyers] committed fraud against [seller],” a complaint that was too broad and generic to preserve any specific error. The Court also affirmed an award of $9,675 in attorney fees to the buyers under a prevailing-party clause of the contract, holding that the seller’s briefing about that award failed to discuss the evidence concerning the fees and did not explain how the cited case law should be applied to the jury’s finding.

Davenport Meadows LP v. Dobrushkin, No. 05-12-01471-CV

The company operating the Golf Club at Castle Hills agreed to grant lifetime memberships to a number of golfers, who filed suit in order to vindicate those contracts after the course was foreclosed on and sold to defendant CAPX Realty. Although the plaintiffs continued to golf for free for the next four years, that was not enough to raise a genuine issue of material fact on the golfers’ theory that CAPX had ratified their contracts. Ratification is a theory by which a principal can affirm a contract entered into by an agent.  But CAPX was not a party to the contract, and nobody was acting as CAPX’s agent in entering into the contract. Therefore, CAPX could not ratify the lifetime memberships, and summary judgment was appropriately granted.

Averett v. CAPX Realty LLC, No. 05-13-00885-CV

The Court of Appeals has issued a lengthy opinion affirming the denial of a special appearance. The appeal arises out of an apparently contentious case involving claims and counterclaims for breach of contract, fraud, and defamation. Defendant Sebastian Lombardo — an Italian citizen who lives in Belgium and works in France — challenged personal jurisdiction by invoking the fiduciary shield doctrine, which protects officers of corporations from being personally haled into court in Texas due to their contacts as representatives of the corporation. Unfortunately for Lombardo, his argument in the trial court had presented that issue as a matter of general personal jurisdiction, and the trial court had found him to be subject to specific personal jurisdiction. Having failed to present the fiduciary shield doctrine as a bar to the exercise of specific personal jurisdiction, the issue was also waived on appeal. The opinion goes on to affirm the legal and factual sufficiency of the evidence supporting the trial court’s findings of jurisdictional facts, as well as its application of the law to those facts, and therefore affirmed denial of the special appearance.

Lombardo v. Bhattacharyya, No. 05-13-01583-CV

The issue in this case was whether the trial court erred in awarding attorneys’ fees to the defendant when the plaintiff dropped its claim under the Texas Theft Liability Act (“TTLA”)  a few days after the defendant filed a motion for summary judgment.

Under the TTLA, the prevailing party is entitled to recover attorneys’ fees.  In this case, the plaintiff brought a TTLA claim against the defendant.  When the defendant moved for summary judgment, the plaintiff must have realized that it was going to lose.  Consequently, the plaintiff amended its complaint and removed the TTLA claim, effectively nonsuiting it.  Thus, the plaintiff claimed that the defendant was not a prevailing party and therefore not entitled to attorneys’ fees.

The Court of Appeals affirmed the trial court’s decision to award attorneys’ fees, holding that a party is still a prevailing party if the nonsuit was taken to avoid an unfavorable ruling on the merits.  This result was further cemented by the fact that at the hearing on attorneys’ fees, plaintiff’s attorney acknowledged that by filing its nonsuit the plaintiff “basically, said ‘Uncle.'”

BBP Sub I LLP v. Di Tucci

In this challenge to an arbitration award, the Court of Appeals rejected the losing party’s attempt to vacate the arbitration award on grounds of “manifest disregard” for the law or “gross mistake” by the arbitrators because the appellant failed to submit a record of the arbitration proceedings.  According to the Court, “without a record of the arbitration proceedings showing the evidence or the law that was presented to the arbitrators, we cannot conclude the arbitrators manifestly disregarded the law or committed a gross mistake.”

Beech Street Corp. v. Baylor Health Care Sys.

The developer of a condominium project in Fort Worth sued the general contractor it had hired to construct a rooftop pool and deck. Inevitably, the general filed third party claims and cross-claims against various other participants, including engineers and subcontractors, seemingly all of whom filed claims, cross-claims, and counterclaims against everyone else. Two of the defendants moved to dismiss some of third party claims on the basis that the claimants had not complied with the certificate of merit requirement for suits against licensed architects, engineers, and surveyors.  See Tex. Civ. Prac. & Rem. Code § 152.002. Applying recent authority from the Texas Supreme Court, the Court of Appeals held that a certificate of merit is only required to initiate suit, not for defendants or third-party defendants who assert claims for relief within a lawsuit. However, the Court also ordered the dismissal of the plaintiffs’ fifth amended petition as to one of the two defendants on the basis that they had failed to attach a certificate of merit to the amended petition before the deadline.

Hydrotech Engineering, Inc. v. OMP Dev., LLC, No. 05-13-00713-CV

Mr. and Mrs. Carpenter hired the law firm of Shaw & Lemon to represent them in a lawsuit against Holmes Builders.  The Carpenters agreed to pay Shaw & Lemon 40% of any recovery.  Shaw & Lemon, in turn, hired attorney Daniel Hagood to assist with the case.  In exchange for Mr. Hagood’s assistance, Shaw & Lemon agreed orally to pay him 25% of their 40% contingency fee.

Ultimately, the Carpenters obtained a judgment against Holmes for more than $2 million.  Rather than pay the judgment, however, Holmes filed for bankruptcy protection.  By this time, Mr. Shaw and Mr. Lemon had experienced a falling out and had parted ways (and sued each other).  Mr. Lemon, on his own, was then retained by the bankruptcy trustee to recover assets for Holmes’ bankruptcy estate, for which he would receive 34% of any assets recovered.  Significantly, as part of this arrangement, Mr. Lemon, on behalf of himself and his firm, waived any right to payment from the Carpenters.

It turns out that Mr. Lemon was fairly successful at recovering assets for the estate, as he recovered over $1 million.  As a result, the Carpenters received nearly $600,000 for their claim.  Once the Carpenters were paid, Mr. Hagood sought his cut of their recovery based on the agreement he had with Lemon and Shaw.

In this opinion, the Court of Appeals addressed several issues, one of which was whether Hagood had a valid breach of contract claim against Lemon.  Lemon argued that since neither he nor his now-defunct firm received any payment from the Carpenters, Hagood had no claim.  The Court rejected that argument, noting that “one who prevents or makes impossible the performance of a condition precedent upon which his liability under a contract is made to depend cannot avail himself of its nonperformance.”  Here, the Court noted that Lemon’s waiver of his firm’s right to recover from the Carpenters made impossible the performance of the condition precedent to Lemon’s liability under the agreement with Hagood, because “[a] duty to cooperate is implied in every contract in which cooperation is necessary for performance of the contract.”

Lemon v. Hagood

Providence Bank sued for a deficiency judgment after the bank foreclosed on one of the borrower’s properties. The parties agreed to settle that claim, and so the bank filed a notice of nonsuit by mail. But on the same day the bank mailed in the nonsuit, the borrower filed brand new counterclaims against the bank on other properties. So the question became whether the bank’s nonsuit terminated the entire case before the filing of the counterclaims. The Court of Appeals answered that question in the negative.  Although TCRP 5 deems a document to be filed on the date it is mailed, that rule only applies to documents that have to be filed by a particular deadline. By contrast, a nonsuit under Rule 162 can be filed at any time before the close of the plaintiff’s evidence. Accordingly, the nonsuit was not deemed filed at the time of mailing, and by the time it arrived at the courthouse for filing, the borrower’s counterclaims were already part of the lawsuit and could move forward as part of the case.

FP Asset Group, LP v. Providence Bank, No. 05-12-01728-CV

This breach of contract case addressed a loan guarantor’s contractual duty to defend the lender in a fraud lawsuit.  The Court was asked to interpret a duty to defend provision that conditioned the duty on the “occurrence” of fraud, when the pending lawsuit at issue had to this point only raised “allegations” of fraud.  According to the Court, the duty to defend is a contractual duty depending on the precise terms of the contract.  Thus, the Court refused to rewrite the section at issue to replace the word “occurrence” with “allegation.”  Because the pending fraud claim only involved fraud “allegations” at this point, the defendant owed no duty to defend.

Myers v. Hall Columbus Lender LLC

Len Rao filed suit against his former employer, David Weekley Homes. Weekley moved to abate the lawsuit and initiated an arbitration proceeding with the AAA. The trial court denied the motion to compel arbitration, and the Court of Appeals — after first granting an emergency motion to stay the proceedings — ultimately affirmed the denial of arbitration. After the case moved back to the trial court, however, Rao added new claims against the AAA, which responded with a plea to the jurisdiction based on the doctrine of arbitral immunity. The trial court granted the plea, and the Court of Appeals affirmed. Arbitral immunity, the Court held, extends not only to arbitrators themselves, but also to the association that administers their proceedings.

Rao v. Am. Arbitration Ass’n., No. 05-13-00462-CV

In this age discrimination employment claim, the Court of Appeals reversed the trial court’s grant of summary judgment for the defendant.  According to the Court, there was conflicting evidence about the defendant’s reason for firing the plaintiff.  Although the defendant claimed that the downturn in the economy forced them to fire the plaintiff, the plaintiff argued that, at the time of his termination, he was working on projects that would have required another year to complete.  This conflict created a sufficient fact issue for the plaintiff to survive summary judgment.

Stillwell v. Halff Assocs., Inc.

Among several issues on appeal in this dispute between a commercial landlord and tenant, the Court of Appeals considered whether the defendant could recover attorneys’ fees pursuant to the declaratory judgments act.  After the plaintiff sued the defendant for breach of contract for failing to construct ramps in compliance with the ADA, the defendant responded by requesting a declaratory judgment that he had no duty to pay for the ramps.  Because the defendant’s counsel admitted at trial that the issues raised in his declaratory judgment action would be resolved by the plaintiff’s breach of contract lawsuit, the court rejected the defendant’s attempt to recover attorneys’ fees, noting the rule that “a party cannot use the declaratory judgments act merely as a vehicle to obtain otherwise impermissible attorney’s fees.”

Cellular Sales of Knoxville, Inc. v. McGonagle

Addressing a motion to compel arbitration, the Court of Appeals found that a provision in the defendant’s employee handbook did not require arbitration because that provision stated, in part, that “[b]inding arbitration requires the employee and [defendant] to commit to resolution of all eligible issues and be bound by the decision of the arbitrator.”  According to the Court, this language established that the parties had not already agreed to arbitrate, but rather that they must still make the decision if a dispute arises in the future.

Texas Health Resources v. Kruse

In this dispute between neighbors over a poorly placed fence, the victorious neighbors appealed the trial court’s decision denying them their court costs.  The case had already been up to the Court of Appeals once before, where the Court reversed the trial court and remanded the case “for entry of judgment consistent with our opinion and for consideration of the [successful neighbors’] request for attorney’s fees.”  On remand, the trial court refused to award court costs because the mandate from the Court of Appeals only referenced attorneys’ fees and made no mention of court costs.

The Court of Appeals again reversed the trial court, holding that the prevailing neighbors were entitled to recover their trial court costs pursuant to Rule 131 of the rules of civil procedure.  Although court costs were not specifically mentioned in the Court’s previous mandate, “the trial court retains its constitutional jurisdiction to perform duties collateral to and consistent with” that mandate.

Blaylock v. Holland

In a follow-up from an opinion issued a few months ago, the Court of Appeals has affirmed summary judgment in favor of the financiers of a development project in Fort Worth. For essentially the same reason that the buyer could not recover against the architect who had referred the deal in the first place — namely, that the paperwork for the sale fully disclosed the fact that the property was partially situated on a 100-year floodplain. Because the architect’s summary judgment motion had conclusively negated any possibility that he was personally responsible for any fraudulent misrepresentations, the buyer could not recover for fraud against the finance he was allegedly representing in the transaction.

Collective Asset Partners, LLC v. Pana, No. 05-13-00552-CV

The Texas Supreme Court today affirmed the Dallas Court of Appeals’ judgment in a wrongful death/asbestos case, which had vacated an $11.6 million plaintiff’s verdict. The majority opinion disagreed with the Court of Appeals’ holding that the plaintiff had to prove that the decedent would not have contracted mesothelioma but for his exposure to the defendant’s own product. Nevertheless, applying the “substantial factor” test for causation, the majority held that the plaintiff had still failed to provide legally sufficient evidence that the defendant’s product had caused the victim’s illness.

Bostic v. Georgia-Pacific Corp. (majority)

Bostic v. Georgia-Pacific Corp. (Guzman concurrence)

Bostic v. Georgia-Pacific Corp. (Lehrmann dissent)

Last month, we noted an opinion that teased, but did not answer, an interesting question: Does Chapter 74 of the Civil Practice & Remedies Code require a plaintiff to produce an expert report for a breach of contract claim arising out of the provision of medical services? The Court of Appeals has now issued an amended opinion in that same case that addresses that very issue. While still holding that the defendant/counterclaimant had failed to preserve error by failing to make a proffer of the excluded evidence — namely, that his mother had been placed in a straitjacket despite the assisted-living facility’s contract stating that it was a “restraint-free community” — the revised opinion adds a new section on the expert report issue. The Court now concludes that even if the evidentiary issue had not been waived, the trial court still properly excluded that evidence because it was still a healthcare liability counterclaim that required the defendant to produce a Chapter 74 expert report. Since the defendant failed to do so, the trial court did not abuse its discretion in excluding evidence of the resident being placed in restraints.

Ferguson v. Plaza Health Servs. at Edgemere (amended opinion), No. 05-12-01399-CV

In this restricted appeal, the defendant argued that the trial court erred in entering a default judgment against it in the absence of evidence establishing mental anguish damages.  Because the trial court received testimony of the plaintiffs physical injuries form a slip and fall, and no testimony on mental anguish, and because there was no way to distinguish between the award of mental anguish damages and those awarded for past physical pain, the judge’s award of $20,000 constitutes error on the face of the record.

Center Operating Co. v. Duncan

In this forcible detainer action, the trial court dismissed American Homes 4 Rent’s (AH4R) attempt to evict the defendant because AH4R could not prove that it had title to the property at issue.  Specifically, the trial court based its dismissal on the defendant’s argument that she had filed bankruptcy the day before AH4R bought the property and thus its purchase was void because it had violated the automatic stay.  The Court of Appeals reversed the trial court’s dismissal, because to prevail in a forcible detainer action, “a plaintiff is not required to prove title, but is only required to show sufficient evidence of ownership to demonstrate a superior right to immediate possession.”

American Homes 4 Rent Props. One LLC v. Ibarra

In this breach of settlement action, the plaintiff won almost $10,000 in damages, but the trial court awarded him zero dollars in attorneys’ fees.  On appeal, the Court found that attorneys’ fees were proper under section 38.001(8), so the trial court had no discretion to deny them.  The Court noted that one of the factors in determining the reasonableness of attorneys’ fees is the amount of damages awarded, and remanded the determination to the trial court.

Garcia v. Solorio

Hidden within this seemingly straightforward post-foreclosure forcible detainer action is an interesting evidentiary issue.  After purchasing the Martins’ home at a foreclosure sale, Fannie Mae sought to have them evicted by filing a forcible detainer action in County Court at Law.  The trial court ruled in favor of Fannie Mae, and the Martins appealed, arguing, among other things, that Fannie Mae did not introduce evidence to establish that it owned the property.

That issue turned on whether the substitute trustee’s deed (which showed that Fannie Mae owned the property) was admitted into evidence.  Apparently, when Fannie offered the substitute trustee’s deed into evidence, the Martins’ attorney objected to the second page of the document on the basis of hearsay and the trial court sustained his objection.  Later, however, Fannie’s attorney discussed and summarized the relevant provisions of the deed and made arguments about the deed as if it had been admitted into evidence.  Notably, the Martins’ attorney never objected to these statements, leading the Court of Appeals to conclude that the substitute trustee’s deed was, “for all practical purposes,” admitted into evidence.  Accordingly, the Court affirmed the trial court’s ruling.

Martin v. Fed. Nat’l Mtg. Ass’n

We depart from our usual fare of commercial litigation to spotlight a candidate for inclusion in future family law textbooks (or at least study materials for the Texas Bar Exam). To establish a common law or “informal” marriage, the claimant has to prove (1) the couple agreed to be married, (2) after that agreement they lived together in Texas as husband and wife, and (3) they represented to others that they were married. After Joseph Marek died intestate, Deborah Anderson intervened in the probate of his estate, claiming she and Marek had an informal marriage. The probate court sided with Anderson. Marek’s sister appealed, challenging the sufficiency of the evidence that the couple had an agreement to be married and represented to others that they were married.

The Court of Appeals conducted a detailed review of the evidence and affirmed the trial court’s judgment. The proof that Marek and Anderson had held themselves out as married was conflicting, but the trial court was entitled to resolve that conflicting evidence in favor of Anderson. The seemingly closer issue was whether Marek and Aderson actually had an agreement to be married. Anderson testified that agreement came when she returned to Marek’s house (colorfully, from an illegal gambling parlor) after a period of separation. Anderson testified that Marek asked her “Are you here for good, Babe?” and she responded “Yes.” The Court held that this testimony alone was not specific enough to establish anything more than an agreement to cohabitate. Nevertheless, it was still circumstantial evidence that, combined with all the evidence that the couple had actually lived their lives as husband and wife (including six years of “Married, Filing Jointly” tax returns), served to establish an agreement to be married. Thus, it appears that evidence of a couple acting as if they are married, and representing themselves to be married, can also establish the required element of an actual agreement to be married.

In re Estate of Marek, No. 05-13-01008-CV

After a dispute arose between the owner of an apartment complex and the contractor hired to renovate it, the owner sent the contractor checks totaling more than $8,000 with a letter stating that it was “full and final payment” for all amounts owed. The contractor cashed the check, but subsequently filed a lien and sought to recover an additional $14,000 in unpaid invoices. The trial court granted judgment for the defendant, and the Court of Appeals affirmed. Although the contractor’s owner testified that he had not “knowingly and affirmatively” agree to an accord and satisfaction, the trial judge was entitled to disregard that evidence as not believable. Luckily, however, the apartment owner conceded that the $14,000 awarded on its own counterclaim was erroneous, and so the Court of Appeals vacated and rendered that portion of the judgment, with a remand for further consideration of the attendant attorney fees.

Contemporary Contractors v. Centerpoint Apt. Ltd., No. 05-13-00614-CV

In this breach of contract case, the Court of Appeals found that the defendant had not breached the stock purchase contract because the parties’ agreement required the plaintiff to tender his stock into escrow account before the defendant’s obligation to purchase the stock accrued.  Since the plaintiff never placed his stock into escrow (a condition precedent according to the Court), the defendant’s obligation to perform under the contract was excused.

Sadeghi v. Gang

Mike Jabary obtained a commercial certificate of occupancy for a restaurant in Allen, Texas.  As it turns out, Mr. Jabary opened a hookah bar instead of a restaurant.  Consequently, the City of Allen revoked his certificate of occupancy.

Mr. Jabary sued the City, alleging both private and public takings.  The City filed a motion for summary judgment on the ground that, because Mr. Jabary had not exhausted his administrative remedies by filing an appeal with the City, his claim was not ripe.  The trial court granted the City’s MSJ, and Mr. Jabary appealed.  On appeal, the Court of Appeals affirmed the trial court’s decision, rejecting Mr. Jabary’s argument that appealing to the city would be futile.

Jabary v. City of Allen

Alan Ritchey Materials Co., a construction materials supplier, contracted to supply  materials to make concrete for a subdivision development.  Ritchey provided the general contractor with over $100,000 worth of sand, but was never paid, so it filed a materialman’s lien on the property.  The property owner argued that the lien was not proper because more sand was delivered to the project than was required to complete the job and, as a result, under the statute, Ritchey could not prove that it “furnished goods . . . for a specific job.”  However, the Court found, among other things, that the evidence in this case established that the sand was delivered to the general contractor in connection with project and, given the liberal interpretation courts have given to the lien statute, the fact that some materials may not have been used is irrelevant to the analysis.

Addison Urban Development Partners, LLC v. Alan Ritchey Materials Co.

A trial court that dismisses a lawsuit after a motion made under the Texas Citizens Participation Act “shall award to the moving party . . . reasonable attorney’s fees . . . incurred in defending against the legal action as justice and equity may require.” Tex. Civ. Prac. & Rem. Code § 27.009(a)(1). In this case, the trial court signed its order on March 6 granting the defendant’s motion to dismiss the lawsuit, then followed it up on April 14 with an order awarding defendant $15,616 in attorney fees and sanctioning the plaintiff another $15,000. The plaintiff claimed that the April 14 award was a nullity because the March 6 order was a final judgment. The Court of Appeals disagreed, first order did not purport to dispose of the defendant’s claim for fees and costs, and both the court and the parties recognized that there had not been a final judgment because they continued to litigate the additional issues. The Court of Appeals went on to rule on several other issues, concluding among other things that the plaintiff had waived any complaint about the trial court’s failure to timely hold a hearing on the motion to dismiss by failing to object in the trial court; that the statements attributed to the defendant were not capable of being defamatory; and that the plaintiff had not pointed to any evidence of damages to support its tortious interference claim. The judgment was therefore affirmed.

American Heritage Capital LP v. Gonzalez, No. 05-12-0892-CV

The defaulting defendant in this case claimed that the plaintiff’s service through the Secretary of State was defective because the plaintiff did not establish reasonable diligence in its failed efforts to effect service via registered mail and personal delivery.  The Court of Appeals found that the plaintiff exercised reasonable diligence in both of its prior attempts to carry out service.  Regarding registered mail, the record established that the plaintiff paid the clerk and arranged to have the defendants served by certified mail, return receipt requested at the defendant’s registered address.  When the mailing was returned with the notation that it was undeliverable and could not be forwarded, the plaintiff had sufficiently exercised reasonable diligence.  Regarding personal service, the plaintiff sent a process server to defendant’s registered address, but neither plaintiff’s business nor its registered agent were there.  According to the Court, this was enough since “[t]he statute does not require efforts to find the registered agent at any place other than at the entity’s registered office.”

Katy Venture Ltd. v. Cremona Bistro Corp.

Aamer Razi hired attorney Edwin Sigel to represent him in connection with criminal charges brought against him.  Sigel, concerned that Razi would not be able to pay his bills, worked out a deal in which Razi signed a power of attorney appointing Sigel as his agent generally, including over all matters regarding his residence condominium.  Sigel then transferred the condo to himself as trustee.  Apparently, the parties had different understandings of this arrangement: Sigel believed it was to provide security for Razi’s legal fees, while Razi thought Sigel was just going to take care of the condo.  After Razi fired Sigel and refused to pay his bills, Sigel sold the condo.

Razi then sued Sigel for breach of fiduciary duty and conversion, and moved for summary judgment, which the trial court granted. Sigel appealed, and the Court of Appeals reversed, finding that the trial court erred in granting summary judgment because fact issues existed regarding whether Sigel explained that Razi was in effect signing over his condo as collateral.

Sigel v. Razi

In this breach of contract case involving the sale of an apartment complex, the buyer refused to proceed to closing because the seller failed to provide it with a pamphlet from the EPA regarding lead-based paint, which was required by the contract.  The seller sued the buyer, and the trial court ruled in the seller’s favor because even though the contract did require the seller to provide the pamphlet, the buyer waived that breach by failing to object in writing as required by another provision in the contract.  The Court of Appeals affirmed.

Winston Acquisition Corp. v. Blue Valley Apartments Inc.

After a string of missed, overpaid, refunded, and improperly credited property tax payments and a cancelled foreclosure, homeowners Peter and Natalya Shin sued Chase Home Finance under the Texas Debt Collections Practices Act. Chase moved for a no-evidence summary judgment, which the trial court granted. The Court of Appeals affirmed, holding that the plaintiffs had failed to come forward with evidence showing a violation of the Act. Among other things, the Court held that the homeowners had not shown Chase had attempted to collect unauthorized fees, because the mortgage papers provided that Chase could indeed collect the subject fees if the borrowers did not pay their property taxes on time. Since there was no question that the plaintiffs had been late in paying their property taxes, Chase’s attempt to set up and collect the funds for an escrow account was authorized under the parties’ agreement.

Shin v. Chase Home Finance LLC, No. 05-12-01634-CV

In 2005, Brad Keiller, an investor in adult entertainment clubs all over the world, came to Dallas to explore the purchase of Texas Show Girls, a club owned and operated by Curtis Wise.  Following negotiations, the parties signed a share purchase agreement in which Wise warranted that Keiller could rely on Wise’s representations that, among other things: (1) the club’s lease was in good standing and not in default; and (2) the club had only one pending investigation by the Texas Alcoholic Beverage Commission.  As it turned out, neither of these representations were true.  The club’s lease had been terminated and the purported single pending TABC investigation was actually 12 separate charges (for, among other things, underage drinking, prostitution, lewd conduct, and drug use) consolidated into a single action that was going to result in the termination of the club’s liquor license.  On appeal, the Court upheld the jury’s $704,480.45 fraud verdict based on these facts, finding that Keiller had presented sufficient evidence to establish his fraud claim.

Wise v. SR Dallas, LLC

Last November, the Texas Supreme Court reversed and remanded for further consideration in a case where the Dallas Court of Appeals had concluded that the plaintiff had sufficiently pleaded a waiver of sovereign immunity through the use of tangible property. The Supreme Court held that the plaintiff had not alleged a “use” of property for a whiteboard that fell on his head, because Dallas Metrocare had only made the board available for use by patients. On remand, the Court of Appeals had to consider the alternative question of whether the plaintiff’s claims alleged injury through a “condition” of property. The Court concluded that he had pleaded such a claim, based on the allegation that the whiteboard was in an unsafe condition because it was not properly secured. The case was therefore remanded to the trial court for further proceedings.

Dallas Metrocare Servs. v. Juarez, No. 05-11-01144-CV