US Bank “prayed for a declaration that [appellant’s] equitable title was subject to US Bank’s lien.”

But US Bank pleaded a suit to quiet title as its cause of action. “In such a suit, the plainitff has the burden to show (1) an interest in a specific property, (2) title to the property is affected by a claim by the defendant, and (3) the claim, although facially valid, is invalid or unenforceable.”

Because that claim didn’t match the requested relief, the Fifth Court reversed summary judgment for the bank. TFHSP, LLC v. U.S. Bank N.A., No. 05-22-00002-CV (March 8, 2022) (mem. op.).

X Extreme Construction won a $200,000 judgment in Dallas district court against three defendants. One of the defendants then sold his house, after which X Extreme  obtained a receivership over, inter alia, the sales proceeds. After more skirmishing, the Dallas court issued a writ of execution to sell the house; the purchasers filed suit in Denton County to enjoin the sale; and the Dallas court ordered the purchasers to dismiss the Denton case. The resulting standoff led to a petition for writ of mandamus, which the Dallas Court of Appeals conditionally granted in In re Marzwanian, No. 05-18-00485-CV (June 12, 2018) (mem. op.) The Court concluded that the Dallas court lacked jurisdiction over the purchasers, who were not parties to the underlying litigation, and that no statute or common law principle required litigation about the purchasers’ title to occur in the court that appointed the receiver.

The Judah family owned three lots in DeSoto, near a busy highway and a church. Over the years, as the property changed hands and the church grew, access problems developed between the property and the highway. During a 2007 expansion of a parking lot, as part of acquiring a road previous owned by the city, the church:

“. . . signed a new amended plat for the property that showed  he abandoned roadway and specifically outlined utility easements. The Owners Certificate attached to the plat described the easements being granted to the public utilities in detail. On the front of the plat was a notation stating, ‘NOTE: A Blanket Ingress/Egress Easement is granted across Lot 1A, Block 4 of this plat [the church’s property] to 168 Church Street [one of the Judah lots].”

In subsequent litigation about access to that lot, The Fifth Court found that this language was insufficient to establish an express easement or an easement by estoppel, and affirmed summary judgment for the church. Sandoval v. Community Missionary Baptist Church,  05-17-00456-CV (April 13, 2018) (mem. op.)

Appellant alleged that she established a “loss of ownership resulting from a legal proceeding” within the meaning of a real estate listing agreement, which would excuse the obligation to pay a broker’s commission. Unfortunately, while the relevant “divorce proceeding created a cloud on the [p]roperty’s title, and, as a result, the title company couldnot issue a title policy as required by the sales agreement,” that did not create the requisite “loss” – “By definition . . . a cloud on title does not equate to a loss of ownership. . . . [A] cloud is something with the potential to affect ownership if and when it is established as valid.” Ruder v. Jordan, No. 05-16-00742-CV (Feb. 2, 2018) (mem. op.)

“The parties are owners of adjoining property whose homes overlook a golf course. The Roses built a fence that blocked the view from the Bonvinos’ home. The ensuing legal dispute has lasted almost a decade.” That description begins a memorandum opinion affirming a Collin County trial court’s order enforcing a permanent injunction requiring the Roses to reduce the maximum height of their fence to 6 feet. The case hinged on the trial court’s finding that the “2012 Fence” exceeded 6 feet when measured from the “unaltered and unimproved grade.”

And thus, peace and tranquility were restored to Far North Dallas.

Rose v. Bonvino, No. 05-14-007020-CV

One of the messiest cases in recent memory has resulted in a 79-page opinion and judgment that disposes of the case in almost every way imaginable: “Our decision in this case is to vacate, in part, affirm, in part, dismiss, in part, and reverse and remand to the trial court, in part.” The case arose out of a lease executed by Fitness Evolution, its subsequent acquisition by Headhunter Fitness, a series of personal guarantys, assignments, representations, and just about everything else one might find in a bar exam essay question. Since this one pretty much defies summary, we will instead report that while summary judgment was affirmed on some claims, the end result is that most everybody involved will be remanded to the Collin County trial court for additional proceedings.

Fitness Evolution, LP v. Headhunter Fitness, LLC, No. 05-13-00506-CV

A Highland Park property dispute has resulted in a 30-page memorandum opinion affirming the trial court’s summary judgment ruling that the defendants have title to a strip of land adjacent to their home, but also reversing an attorney fee award of $40,670 against the plaintiff, Armstrong DLO Properties. ADLO filed suit, seeking to establish that (among very many other things) a 1949 warranty deed in the defendants’ chain of title was invalid, which would make the frontage of ADLO’s lot approximately 155 feet wide.

During the summary judgment hearing, the trial court revealed that it had sua sponte discovered that ADLO’s owner had successfully sued the estate of his father seeking reformation to the deed, establishing that the frontage was only 140 feet wide. The court orally stated that it would take judicial notice of that judgment, describing it as an issue of “estoppel.” The court subsequently granted summary judgment for the defendants without identifying the grounds for its ruling. The Court of Appeals rejected ADLO’s claim that the district court had improperly relied on matters outside the record in granting the summary judgment, as there was nothing in the written summary judgment order indicating that the court had actually granted summary judgment on the basis of the prior judgment. Because the grounds otherwise presented in the defendants’ motion were sufficient to justify summary judgment, the Court affirmed it. However, the Court reversed as to the award of attorney fees, holding that fees were not recoverable under the Declaratory Judgments Act because the issue was title to the property, not the location of the boundary between properties. See Tex. Civ. Prac. & Rem. Code § 37.004(c).

Armstrong DLO Props., LLC v. Furniss, No. 05-13-01581-CV

Update: The pressure is now on a for a three-peat next week.

Legacy Hillcrest Investments is seeking to develop a pair of lots just west of the SMU law School and north of of a single family district. After a series of proposals and counterproposals, Legacy sought a permit for to build a three-story parking garage. The community development staff approved the application, but the Board of Adjustment denied it. That led Legacy to file for a writ of mandamus, which the district court granted. The Dallas Court of Appeals reversed. The city’s zoning ordinance provided that only surface parking lots could be located “adjacent to” a single-family district. The Court held that the ordinance prohibited a parking garage because Legacy’s lots were across the street from the single-family district, making them “adjacent” to one another under the plain meaning of the term.

Bd. of Adjustment v. Legacy Hillcrest Invests., LP, No. 05-13-01128-CV

An overly-complicated series of transactions led to a dispute over who had valid title to a residential property at 2701 Wickham Court in Plano. The case turned on which of two competing deeds — one filed by the corporation of Quang Dangtran and the second filed by another company that took its deed from his ex-wife, Tuyet Anh Le — was effective. The Court of Appeals affirmed in part and reversed in part. The Court agreed with the trial court’s summary judgment ruling that Dangtran’s deed was not properly acknowledged because it failed to identify the state where the corporate entity was incorporated (see Tex. Civ. Prac. & Rem. Code 121.008(b)(4)). However, the Court also held that there was a genuine issue of material fact whether the second claimant took the deed from Le with notice of her ex-husband’s claim, which would negate her transferee’s status as a bona fide purchaser. Because Dangtran was in unequivocal possession of the property at the time of the second transaction, and because Dangtran was not a member of Le’s family at that time, summary judgment could not be sustained on the second claimant’s bona fide purchaser defense.

Whoa USA, Inc. v. Regan Props., LLC, No.05-13-01412-CV

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 negligent misrepresentation and fraud case, the Court of Appeals has affirmed summary judgment for the defendant based on the statute of limitations. Collective Asset Partners LLC sued Michael Schaumburg and his architectural firm after Schaumburg informed CAP about a property for sale in Tarrant County and took a $1 million fee in the resulting sale. Half of the property turned out to be located on a floodplain, which allegedly caused CAP to be unable to develop it. Schaumburg sought and obtained summary judgment that there had been no misrepresentation because the paperwork for the sale included disclosures that identified the floodlplain. Nor could CAP show a misrepresentation based on a $10.25 million appraisal on the property, as that appraisal was only intended for use by the bank that commissioned it and could not be justifiably relied upon by third parties.

Collective Asset Partners LLC v. Schaumburg, No. 05-13-00040-CV

HSBC Bank foreclosed on a residential property in Cedar Hill, but failed to pay assessments on the property to the local homeowners association. The HOA foreclosed on its assessment lien, and the property was purchased out of foreclosure by Khyber Holdings, LLC. HSBC sought to redeem the property as permitted by § 209.011 of the Texas Property Code. However, when the bank’s attorney sent the required notice to Khyber, the letter incorrectly identified Countrywide Home Loans as the owner seeking to redeem the home. The attorney testified that the error had occurred because he represented the servicer for both HSBC and Countrywide, and that Khyber had purchased lots owned by both lenders during the same foreclosure sale. HSBC sued for a declaratory judgment that it was entitled to redeem the property. When Khyber responded with a letter that stated the redemption price would be $80,000, the attorney responded with an $80,000 check and a letter that once again named Countrywide as the owner, although the redemption deed correctly identified HSBC as the grantee of the redemption sale. Khyber refused to allow redemption, the case proceeded to trial, and the jury returned a verdict in favor of HSBC. The Court of Appeals affirmed, concluding that only substantial compliance is required to fulfill the notice requirements of § 209.011, and that the series of back-and-forth exchanges between the parties was sufficient proof that the notice requirements had been fulfilled. The Court also affirmed the jury’s award of damages for trespass, concluding that HSBC was entitled to recover for lost rents during the period of time the property was improperly retained by Khyber.

Khyber Holdings, LLC v. HSBC Bank USA, N.A., No. 05-12-01212-CV

In August 2002, after Kroupa and WIlliams had been living together in a common law marriage for a number of years, Williams took out a home equity loan on the parties’ residence without telling Kroupa.  Kroupa discovered the home equity loan the following month, in September 2002.  Several years passed, and Kroupa and Williams finalized their divorced in 2007 and Kroupa received the residence as part of that proceeding.  In 2008, Kroupa filed a petition seeking to have the home equity loan declared as void.

On appeal, the Court looked to the Texas Constitution’s 1998 amendment concerning home equity loans to determine whether Kroupa could prevail.  Under that amendment , Kroupa argued that the home equity line was void because she did not sign the written agreement or consent to it as the Texas Constitution required.  In response, Williams and Wachovia (the holder of the lien) insisted that Kroupa’s claim was barred by the applicable statute of limitations.  Examining the Texas Constitution and the line of cases discussing this specific provision, the Court found that becuase the lien here was voidable and not void, the statute of limitations applied.  The Court then found that, because Kroupa discovered the lien in September in 2002, and because she filed her lawsuit in September 2008, her suit was barred by the four-year statute of limitations.

Williams v. Wachovia Mortgage Corp.

Lorrie Smith filed suit for judicial foreclosure of a judgment lien against three lots in a Frisco subdivision. Smith had obtained her judgment against Shaddock Builders & Developers, and she recorded an abstract of the judgment on July 15, 2010. Two years earlier, Shaddock had acquired the three lots and immediately conveyed them to another company, Basin, Ltd. The conveyance from Shaddock to Basin was recorded, but the original sale to Shaddock went unrecorded until the seller corrected its “oversight” exactly one day before Smith recorded her judgment lien. Shortly thereafter, Basin conveyed the lots to Sumeer Homes, which built houses and sold the lots to the current homeowners. Each of those subsequent transactions was recorded. Seeking to foreclose on the lots in order to collect on her judgment against Shaddock, Smith sued the homebuilder, the homeowners, their mortgage lenders, and the title company. The defendants moved for and obtained summary judgment against Smith.

On appeal, Smith argued that the conveyance to Shaddock had been fraudulently backdated, and that it had really been filed the day after she recorded her judgment lien. According to Smith, that meant that legal title to the property had not been transferred to Shaddock until after she filed her lien, therfore making the three lots subject to her claim. The court of appeals rejected that argument. Although “legal title” to property serves as evidence of ownership, it does not constitute full and complete title to the property. What really matters when it comes to a judgment creditor’s lien is equitable title to the property, which passes to the purchaser when it pays the purchase price and fulfills the obligations of the contract of sale. In this case, Shaddock had acquired equitable title to the lots three years before Smith recorded her lien, and Shaddock had immediately transferred that title to Basin. Equitable title is a complete defense against the lien of a judgment creditor. Because Basin had acquired equitable title long before Smith acquired her judgment against Shaddock, that title subsequently passed to Sumeer Homes and the subsequent homebuyers free and clear of Smith’s judgment judgment against Shaddock. Nor did Shaddock hold “legal title” to the three lots on the day Smith recorded her lien. The summary judgment evidence showed that the original seller had recorded the sale the day before, and because Shaddock had conveyed the property to Basin by warranty title two years earlier, legal title to the property passed instantly to Basin when the sale to Shaddock was finally recorded. The court of appeals therefore affirmed the trial court’s grant of summary judgment.

Smith v. Sumeer Homes, Inc., No. 05-11-01632-CV

In 2011, the Dallas Court of Appeals affirmed the trial court’s dismissal of an inverse condemnation suit, holding that the former owners of the property did not have a compensable interest merely because they had the right to repurchase it if the City of McKinney ceased using it as a park. That right was invoked when the city decided to build a library on a portion of the property, but the city defended the subsequent takings suit by arguing that the substance of the claim was really a breach of contract for which no sovereign immunity had been waived. On petition for review, the Texas Supreme Court has rejected that argument, holding that the former owners’ deed conveyed a “defeasible estate” to the City, and that the former owners retained a “conditional future interest” in the property. According to the Supreme Court, that was not simply a contractual right, but a property interest that was indeed compensable as a taking. The Supreme Court therefore reversed the judgment of the court of appeals and remanded the case to the trial court to determine whether and to what extent building the library had actually constituted a taking of the property.

El Dorado Land Co., L.P. v. City of McKinney, No. 11-0834

The court affirmed the trial court’s judgment in this commercial real estate lawsuit. Jarvis provided a loan through its loan servicer, NAC, to CAS for the purchase of an apartment complex. The loan documentation identified NAC as the “servicer” and the lender as Jarvis “c/o” NAC. CAS made monthly loan payments directly to NAC, who then disbursed them to Jarvis. CAS later sold the property to K&E through Stewart Title. Stewart Title paid the loan payoff amount directly to NAC for payment to Jarvis, as NAC had done for two other loan payoff transactions to Jarvis in the past. But in this case, NAC did not provide the funds to Jarvis and instead purported to continue making CAS’s monthly payments without notifying Jarvis of the sale. When NAC stopped making those payments, evidently due to insolvency, Jarvis learned of the property sale and sought to foreclose on the property.

K&E filed a declaratory action asserting that the loan was paid off and seeking to prevent foreclosure. Jarvis filed a third-party petition against CAS, Stewart Title asserting negligence and breach of contract claims against Stewart Title for making the loan payment to NAC instead of directly to Jarvis. Jarvis also sought a declaration that the loan was not discharged and sought to quiet title. At trial, Jarvis moved to exclude evidence of the other loans serviced by NAC in which NAC received the payoff amount and disbursed it to Jarvis, which was denied. Based on this evidence, the trial court found that Jarvis and NAC established a procedure where NAC received payoff funds and disbursed them to Jarvis and that NAC had actual and apparent authority to accept the payoff amount here. It entered judgment for K&E, declaring that the loan was fully paid, enjoining Jarvis from attempting to foreclose on the party, and awarding K&E attorney’s fees. The court also granted K&E and Stewart Title summary judgment on Jarvis’s negligence and breach of contract claims and severed out Jarvis’s claims against CAS.

On appeal, Jarvis argued that the trial court erred by denying its motion to exclude because the loan documents dictated the relationship between the parties, and thus the parol evidence rule precluded the evidence of Jarvis and NAC’s other course of dealings. The court held that the loan documents indicated that NAC had authority to act for Jarvis, but the scope of that authority was unclear. Thus, parol evidence showing the scope of NAC’s authority to accept loan payoff amounts and not contradicting the terms of the documents was not barred. Additionally, the evidence was sufficient to show that NAC had implied actual authority to accept the loan payoff. This holding also disposed of Jarvis’s claims against Stewart Title, whose transfer of funds to NAC constituted payment to Jarvis rather than a breach of any duty to Jarvis, and Jarvis’s declaratory action because its lien and deed of trust on the property was discharged. Finally, K&E’s attorney’s fees recovery was warranted because the UDJA permits a declaratory action brought to invalidate a real estate note, as well as any lien securing the note.

Jarvis v. K&E RE One, LLC, et al., 05-11-00341-CV

A developer in Wylie purchased two adjoining tracts of land.  In 2004, he decided to sell  one of the properties to Capital One.  However, the city decided that both properties would have to be developed as one site, with a single access site on the Capitol One property.  The parties therefore entered into a cross-easement agreement, requiring Capital One to pave the internal drives that would link the access site to both of the properties.  However, Capital One finished its construction and obtained a certificate of occupancy without ever constructing the new approach.  The developer ended up building the driveway himself, and sued Capital One to pay for its cost.  After a bench trial, the trial court awarded the developer awarding approximately $22,000 in damages and another $100,000 for attorney fees.

The court of appeals reversed.   According to the appellate court, the cross-easement agreement required the parties to “keep and maintain” the driveway, but not to actually construct it.  The court also rejected the developer’s argument that Capital One had breached the agreement by failing to comply with a government regulation by not constructing the driveway, because there was no evidence the city had ever ordered Capital One to construct it.  The court also rejected the developer’s quantum meruit argument for failing to attack all grounds asserted in the bank’s summary judgment motion, and remanded to the district court for a determination of the bank’s attorney fees as the prevailing party under their contract.

Capital One, N.A. v. Haddock, No. 05-10-01028-CV

The loan agreement for the Regal Parc apartments in Irving was generally non-recourse to the borrower, but it also included a carve-out that made the loan fully recourse if the borrower breached its obligation to remain a single-purpose entity.  After the lender foreclosed on the property, it sued the borrowers for an $11.6 million deficiency, alleging they had violated the agreement by commingling funds with their related entities and committing waste by failing to maintain the property.  The trial court accepted the borrowers’ explanations of why they had not commingled Regal Parc funds with those of other entities, meaning that the loan remained non-recourse.  But the trial court also entered judgment against the owners for approximately $1 million due to waste and improper retention of post-default rents.  The court of appeals affirmed, holding that the trial court’s finding was adequately supported by the testimony of the borrowers’ witnesses.  The court of appeals also rejected the lender’s claim that the borrowers should have been responsible for an additional million dollars worth of waste that occurred before they assumed the loan, because the loan agreement only made the borrowers responsible for waste that occurred “henceforth” — i.e., from the date they assumed the loan.  Finally, the court found sufficient evidence to support the award of damages for waste and retained rents.

Wells Fargo Bank, N.A. v. HB Regal Parc, LLC, No. 05-10-01428-CV

The owners of a tract of land in Collin County formed a limited partnership with an investor and his company to develop the property, then sold the land to the LP.  As part of the sale, the LP issued a $9 million promissory note to the seller, plus another $1.5 million promissory note to a mortgage company, secured by a deed of trust on the property.  Subsequent loans by the mortgage company to the LP upped the debt by another $6.5 million, also secured by deeds of trust and with priority over the note issued to the sellers.  Since it all ended up in litigation, you will not be surprised to learn that the development collapsed.  The sellers sued the limited partnership, their fellow investor, and the mortgage company for fraud, breach of fiduciary duty, and related claims.  The mortgage company initiated foreclosure proceedings, which were stayed by the grant of a temporary injunction.  Before long, everybody filed motions for summary judgment, and the trial court granted them all.

The court of appeals affirmed.  With respect to the seller’s fraud claims, there was no evidence of misrepresentation in the original loan documents because those documents were not in the record on appeal.  Nor was there any evidence the seller relied on any misrepresentations in the subsequent loan agreements because, citing health concerns, she had not presented herself for deposition and she had not included any affidavit in response to the mortgage company’s no-evidence motion.  The court rejected the seller’s argument that the mere fact of having signed the agreement established that the seller had relied on the alleged misrepresentations.

Hall v. Douglas, No. 05-10-01102-CV

One day, Appellee Dale Allen came home to see construction workers installing “HardiPlank” siding on his neighbor’s house.  This neighbor, Appellant Michael Jamison, had chosen to use HardiPlank on the exterior of his house because it is virtually indistinguishable from wood, and yet remains  fire resistant, rot resistant, and insect resistant.  HardiPlank does not shrink, it does not swell, and it does not absorb moisture.  It turns out, however, that the one thing HardiPlank is not resistant to is the subdivision’s restrictive covenant, which required that the “exterior walls” of the homes be covered in approved materials only.  And HardiPlank was not an approved material.

Allen, thus, brought suit to ensure that Jamison complied with the neighborhood’s exterior standards.  The only problem:  Allen himself had wrapped HIS house’s gables in HardiPlank.  Jaimson pointed out Allen’s hypocrisy, arguing, under the doctrine of quasi estoppel, that Allen cannot enforce a covenant with which he failed to comply.  The trial court rejected Jamison’s argument, finding that a “gable” is not the same and an “exterior wall,” and ruled in Allen’s favor.  The court of appeals, however, plunged the depths of Webster’s Third New International Dictionary and determined that a “gable” does, in fact, qualify as an exterior wall.  Having so determined, the Court then held that Allen was estopped from suing to require that Jamison comply with the very covenant he refused to abide by.

Jamison v. Allen, No. 05-11-00603-CV