In Virtuolotry LLC v. Westwood Motorcars LLC, among other holdings, the Fifth Court reversed a judgment that awarded actual and exemplary damages to a tenant who claimed to have been constructively evicted by the landlord’s owner. The damages were assessed against the owner, individually. The Court noted that the tenant was actually evicted as a result of an FED case, and thus held that “[i]f an actual eviction occurs, there can be no constructive eviction.” In this regard, the Court also noted the distinction between constructive eviction and wrongful eviction claims. No. 05-19-01055-CV (Sept. 17, 2024) (mem. op.). LPHS represented Virtuolotry in the case.

Topletz v. Choice affirmed, in part, a class action of tenants against the owners of several rental properties in Dallas. The reversal turned on the extent of the landlord’s liability under several sections of the Property Code, which in turn involved application of the supreme court’s recent opinion about a similar class action in American Campus Communities, Inc. v. Berry, 667 S.W.3d 277, 283 (Tex. 2023). No. 05-22-00781-CV (Aug. 22, 2023).

The issue in Harry Hines Millennium Market Place LLC v. Pawn TX, Inc. was whether a commercial tenant vacated the leased premises on May 31, 2018.

The tenant’s principal testified that it did so, and also offered testimony about how it “gutted the showroom …, moved inventory and all pawns …, pulled down fixtures and back racks,” and made its last pawn-shop transaction on the premises on May 30.

The Fifth Court found the landlord’s contrary testimony to be conclusory (that the tenant “failed to vacate the premises and remained in possession of the Property for an additional two (2) months”). The Court also rejected the landlord’s argument that termination was ineffective absent formal notice, as the lease did not impose such a requirement and the common law does not otherwise impose one. (The Court also declined to consider several photographs submitted along with the landlord’s brief because they were not in the record.) No. 05-21-00778-CV (Feb. 28, 2023) (mem. op.).

The tenants in a residential lease sued for injuries from toxic mold on the property. The Fifth Court expressed sympathy, but nevertheless affirmed summary judgment for the landlord based on an “as is” clause in the lease, citing Prudential Ins. Co. v. Jefferson Assocs. 896 S.W.2d 156 (Tex. 1995). In addition to noting that the clause was prominently written in all-caps, and consistent with other related provisions in the lease, the Court observed: ‘Before they entered into the Lease and related agreements, Rebecca walked through the house twice and Richard walked through the house once. After signing the Lease but prior to moving in, the Potters visited the house again and saw “black substance” on the wall and coming out of a wall socket. Rebecca testified she saw “bubbling” and “deforming” of a wall that, according to a workman, was caused by “clogged gutters.” In a subsequent visit prior to moving in, Richard saw “black underneath the carpet” being removed by a carpet repairman. When they were told by workmen the black substance was dirt and dog feces, the Potters did not further investigate.’ Potter v. HP Texas 1 LLC, No. No. 05-18-01513-CV (Apr. 6, 2019) (mem. op.)

This is a cross-post from 600Hemphill, which follows the Texas Supreme Court:

Henry McCall lived in a cabin on Homer Hillis’s property, occasionally helping Hillis with maintenance at the McCall’s bed-and-breakfast. While working on Hillis’s sink, a brown recluse spider bit McCall. The Texas Supreme Court found that the ferae naturae doctrine barred McCall’s lawsuit against Hillis: “[H]e owed no duty to the invitee because he was unaware of the presence of brown recluse spiders on his property and he neither attracted the offending spider to his property nor reduced it to his possession. Further, [McCall] had actual knowledge of the presence of spiders on the property.” Hillis v. McCall, No. 18-1065 (Tex. March 13, 2020). In addition to its impact on brown-recluse litigation, the reasoning of this opinion about liability for small, dangerous creatures well be relevant in any future litigation about coronavirus exposure.

Last December, the Court of Appeals issued an interim opinion vacating a trial court order that almost quadrupled the supersedeas amount to be paid by TierOne Converged Networks during the appeal of a judgment evicting it and its equipment from the water towers of Lavon Water Supply Corp. Now, the Court has reversed and rendered judgment in favor of TierOne on the merits of the forcible detainer case. The Court agreed with TierOne that it had validly exercised its contractual option to renew the lease of the property for an additional five-year term. Because the lease did not require notice of any renewal, TierOne’s continued occupation of the property and payment of the monthly rent following the expiration of the initial term was sufficient to constitute an election to renew.

TierOne Converged Networks v. Lavon Water Supply Corp., No. 05-13-00370-CV

In this landlord-tenant dispute, the tenants sued the landlord for wrongfully withholding their security deposit in violation of Section 92 of the Texas Property Code.  The trial court granted the tenants’ motion for summary judgment, and the landlord appealed.  The Court of Appeals reversed, finding that there was a disputed issue of material fact as to whether the tenants provided the landlord with a valid forwarding address where the landlord could provide the written notice required by the statute.

Franzin v. Sauty

In this breach of lease case, the appellant argued that the appellee’s damages expert opinion was unreliable and erroneous because it relied on a hypothetical market rent study.  During trial, appellant objected to the relevance of the of the market rent study, but the trial court did not rule on the objection.  The expert then testified in detail about each component of her calculation without objection from appellant about her methodology.  The Court of Appeals, however, found that because the appellant had “failed to object to the expert’s testimony on the basis of improper methodology before or during trial and obtain a ruling form the court,” appellant waived any error.

Transcontinental Realty v. Wicks

In this garnishment action, the Court of Appeals permitted the appellant, as lessor, to recover past due rent under a commercial lease against a sub-lessee.  Among many other issues, the Court rejected the appellee’s argument that the sub-lease was invalid because it was obtained without the landlord’s consent, as required by the lease.  On this point, the court held that “this limitation is for the benefit of the landlord” and that sub-lessee “cannot take advantage of their own wrongs.”

Tenet Health Sys. Hosps. Dallas Inc. v. N. Tex. Hosp. Physicians Gp. P.A.

The Lavon Water Supply Corp. sued TierOne Converged Networks to evict TierOne and its equipment from Lavon’s water towers. TierOne superseded the eviction by depositing $10,800 — one year of rent — into the registry of the court. Lavon then moved to increase the bond to $40,500, basing the increase on the offer of a competing company to lease the space for $3,375 per month. The trial court granted the request to increase the bond, but the Court of Appeals set aside that order on motion for review.

In setting the supersedeas bond in an eviction suit, the court must consider the reasonable value of the rents likely to accrue during appeal. Although the testimony of Lavon’s witnesses established the amount of rent that TierOne’s competitor proposed to pay, there was no evidence that $3,375 was a reasonable rental rate for space on Lavon’s water towers. In addition, TierOne had offered to waive the exclusivity provision in its lease, and the testimony established that TierOne’s competitor was willing to lease space from Lavon with TierOne’s equipment still in place. Thus, there was no evidence that Lavon was being deprived of any increased rents, and the order increasing the supersedeas bond was vacated.

TierOne Converged Networks, Inc. v. Lavon Water Supply Corp., No. 05-13-00370-CV

A landlord-tenant dispute illustrates the limits of a jury’s ability to select an amount to award as damages. After the tenant abandoned the leasehold, the landlord sued for breach of the lease agreement. The jury found for the plaintiff and awarded $200,000 in damages. On appeal, the tenant challenged the evidence of causation between the breach of the lease and the damages awarded by the jury. The Court of Appeals agreed, holding that while there was some evidence of damages caused by the breach, the evidence overall failed to establish that the specific expenses claimed by the landlord were actually made necessary by the tenant’s termination of the lease. While a jury may award damages anywhere within the range permitted by the evidence, it cannot “arbitrarily assess an amount not authorized or supported by evidence at trial.” The Court therefore remanded the case for a new trial on both liability and damages.

Curtis v. AGF Spring Creek/Coit II, Ltd., No. 05-12-00429-CV