Justia Texas Supreme Court Opinion Summaries

Articles Posted in Contracts
by
In this insurance dispute over whether an insurer's payment of an appraisal award obtained under a unilateral appraisal clause bars an insured's claims under the Texas Prompt Payment of Claims Act (TPPCA), Tex. Ins. Code chapter 542 the Supreme Court reversed the judgment of the court of appeals concluding that Insured's claims were barred, holding that Insured's claims should be considered in light of this Court's recent decisions on these issues.After Insurer declined to pay for damage to Insured's properties Insured asked to invoke the policy's appraisal process. Insurer refused, asserting that it was the only party that could invoke appraisal under the unilateral appraisal clause. Insured sued Insurer alleging claims for breach of contract, bad faith, and violations of the TPPCA. Insurer then obtained an order compelling appraisal. After Insurer paid the appraisal award the trial court granted summary judgment for Insurer. The court of appeals affirmed. The Supreme Court reversed, holding that remand was required for the trial court to consider Insured's claims in light of Barbara Technologies Corp. v. State Farm Lloyds, 589 S.W.3d 806 (Tex. 2019), and Ortiz v. State Farm Lloyds, 589 S.W.3d 127 (Tex. 2019). View "Biasatti v. GuideOne National Insurance Co." on Justia Law

by
In this dispute over whether an email exchange reflected the meeting of minds required for a contract the Supreme Court reversed the judgment of the court of appeals reversing the trial court's grant of summary judgment in favor of the Sellers after concluding that the parties did not intend to be bound to any agreement, holding that, as a matter of law, the parties did not execute and deliver a definitive agreement.The Sellers agreed to develop and sell certain assets worth hundreds of millions of dollars. The Sellers and Le Norman Operating LLC (LNO) exchanged a number of emails regarding the purchase of the assets, but the Sellers elected to sell the assets to another entity. LNO brought this breach of contract alleging that the Sellers breached an alleged contract entered into through the email exchange. The trial court granted summary judgment for the Sellers, concluding that there was no meeting of the minds. The court of appeals reversed, concluding that whether LNO and the Sellers intended to b abound by the terms set forth in the exchanged emails were fact issues precluding summary judgment. The Supreme Court reversed, holding that the emails did not constitute a definitive agreement. View "Chalker Energy Partners III, LLC v. Le Norman Operating LLC" on Justia Law

Posted in: Contracts
by
The Supreme Court affirmed the decision of the court of appeals affirming the judgment of the trial court enforcing a liquidated damages provision in a contract, holding that the breaching party in this case did not prove that an unbridgeable discrepancy existed between actual and liquidated damages or otherwise demonstrate that the provision operated as a penalty.After Defendant breached the contract Plaintiff brought this action. The trial court enforced the liquidated damages provision in the contract, concluding that it was not a penalty because it reasonably forecasted the harm that would result from a breach and actual damages were difficult to estimate when the contract was made. The court of appeals affirmed the award of liquidated damages. The Supreme Court affirmed, holding (1) at the time the parties' agreement was made, the harm that would result from a breach was difficult to predict, and the liquidated damages provision reasonably forecast just compensation; and (2) Defendant failed to demonstrate an unbridgeable discrepancy between liquidated and actual damages, measured at the time of the breach, to invalidate the liquidated damages provision. View "Atrium Medical Center, LP v. Houston Red C LLC" on Justia Law

Posted in: Contracts
by
In this venue dispute, the Supreme Court denied a petition for mandamus relief, holding that the trial court did not abuse its discretion in transferring the case to the parties' agreed venue.This case stemmed from a lawsuit alleging wrongful disposition of a limited partnership's assets. A group of the limited partners (collectively, Fox River) sued William Carlson, who owned and controlled the partnership's general partner, claiming that Carlson fraudulently misappropriated groundwater leases, breached the limited partnership agreement, and violated fiduciary duties. Fox River filed the lawsuit in Washington County where Carlson was domiciled. Carlson moved to transfer venue to Harris County, citing a venue-selection clause in the limited partnership agreement. The trial court granted the motion, enforcing the parties' venue agreement in accordance with Tex. Civ. Prac. & Rem. Code 15.020. Fox River sought mandamus relief, arguing that Tex. Civ. Prac. & Rem. Code 65.023(a) mandates venue in a defendant's county of domicile for cases primarily seeking injunctive relief. The Supreme Court denied mandamus relief, holding that section 15.020 requires enforcement of the parties' venue-selection agreement not because it is a "super mandatory" venue provision that supersedes section 65.023(a) but because section 65.023(a) does not apply in suits like this where injunctive relief is not the primary and principal relief requested. View "In re Fox River Real Estate Holdings, Inc." on Justia Law

by
In this contract dispute, the Supreme Court reversed the judgment of the court of appeals reversing the trial court's grant of summary judgment for Defendants, holding that, under the statute of frauds, the proffered contract was not enforceable and Defendants could not be liable for breach of it.The parties to this dispute sent several e-mails prior to the anticipating signing of a formal written agreement, which was never executed. Plaintiffs, however, claimed that the e-mails, taken together, amounted to an enforceable written contract that satisfied the statute of frauds. Plaintiffs sued for breach of the alleged contract and for tortious interference. The trial court granted summary judgment for Defendants on all claims. The court of appeals reversed as to the breach of contract claim, concluding that the e-mails satisfied the statute of frauds and amounted to a contract enforceable against Defendants. The Supreme Court reversed the court of appeals' judgment on the contract claims, holding that there was no written memorandum which was complete within itself in every material detail, as required by the statute of frauds. View "Copano Energy, LLC v. Bujnoch" on Justia Law

Posted in: Contracts
by
The Supreme Court affirmed the judgment of the court of appeals reversing the judgment of the trial court concluding that Petitioners (together, ETP) and Respondents (together, Enterprise) had created a partnership to market and pursue a pipeline project to transport crude oil from Oklahoma to the Gulf Coast, holding that Texas law permits parties to conclusively agree that, as between themselves, no partnership will exist unless certain conditions are satisfied.In three written agreements, the parties set forth their intent that neither party be bound to proceed with the project at issue until each company's board of directors had approved the execution of a formal contract and definitive agreements memorializing the terms and conditions of the transactions were executed and delivered. ETP later sued arguing the parties had formed a partnership to market and pursue a pipeline and that Enterprise breached its statutory duty of loyalty. The trial court entered judgment for ETP. The court of appeals reversed. The Supreme Court affirmed, holding (1) parties can conclusively negate the formation of a partnership through contractual conditions precedent; and (2) the parties did so as a matter of law in this case, and there was no evidence that Enterprise waived the conditions. View "Energy Transfer Partners, LP v. Enterprise Products Partners, LP" on Justia Law

by
In this case examining whether the former version of the Texas Citizens Participation Act (TCPA) applies to certain counterclaims alleged in a dispute over an oil and gas lease the Supreme Court affirmed in part and reversed in part the judgment of the court of appeals dismissing all the counterclaims in this case, holding that the court of appeals properly dismissed one counterclaim but erred in dismissing the remaining counterclaims.At issue was whether each counterclaim was "based on, relates to, or is in response to" the "exercise of the right of free speech" or the "exercise of the right to petition," as defined by the governing statutory text. See Tex. Civ. Prac. & Rem. Code 27.003(a). The Supreme Court held (1) certain communications to third parties about an oil and gas lease allegedly involving the exercise of free speech, on which some of the counterclaims were based, were not covered by the TCPA because they did not relate to a matter of public concern under the TCPA, and therefore, the court of appeals erred in dismissing these counterclaims; and (2) the court of appeals correctly disposed of the "right to petition" counterclaim. View "Creative Oil & Gas, LLC v. Lona Hills Ranch, LLC" on Justia Law

by
The Supreme Court affirmed the decision of the court of appeals affirming the judgment of the trial court declining to compel arbitration of class claims under the parties' agreement in this case, holding that the lower courts applied the correct legal standards in declining to compel class arbitration.This arbitration dispute between homeowners and their home warranty company evolved into a putative class action complaining about releases the warranty allegedly demanded before making covered repairs. Plaintiffs demanded arbitration, asserting that Defendant was required to arbitrate the class claims under the arbitration provisions in the warranty. The trial court granted Defendant's motion to dismiss, concluding that the question of whether the parties agreed to class arbitration was a question of arbitrability for the court to make and that the warranty agreement did not permit class arbitration. The court of appeals affirmed. The Supreme Court affirmed, holding (1) arbitratibility of class claims is a gateway issue for the court unless the arbitration agreement clearly and unmistakably expresses a contrary intent; (2) an agreement to arbitrate class claims cannot be inferred from silence or ambiguity, but rather, an express contractual basis is required; and (3) the lower courts correctly determined that Defendant was not bound to arbitrate Plaintiffs' putative class claims. View "Robinson v. Home Owners Management Enterprises, Inc." on Justia Law

by
The Supreme Court affirmed in part and reversed in part the judgment of the court of appeals in this insurance dispute, holding that an insurer's payment of an appraisal award bars an insured's breach of contract claim and bad faith claims but that an insured may proceed on his claim under the Texas Prompt Payment of Claims Act, Tex. Ins. Code chapter 542.Insured sued Insurer for breach of contract, violations of the Prompt Payment Act, and statutory and common law bad faith insurance practices. Insurer filed a motion to compel appraisal, which the trial court granted. Insurer then filed a motion for summary judgment, arguing that its payment of the appraisal award resolved all claims in the lawsuit. The trial court granted the motion. The court of appeals affirmed. The Supreme Court affirmed, holding (1) the payment barred Insured's breach of contract claim premised on failure to pay the amount of the covered loss; (2) the payment barred Insured's bad faith insurance practices claims to the extent the only actual damages sought were lost policy benefits; and (3) in accordance with today's decision in Barbara Technologies Corp. v. State Farm Lloyds, __ S.W.3d __ (Tex. 2019), Insured may proceed on his claim under the Prompt Payment Act. View "Ortiz v. State Farm Lloyds" on Justia Law

by
In this case arising from an offer to purchase an assignment of a farmout that fell through the Supreme Court affirmed the judgment of the court of appeals concluding that Plaintiff could not prevail on its breach of contract claim or fraud claim as a matter of law, holding that, as a matter of law, both claims failed.The trial court granted judgment in favor of Plaintiff on its claims. The court of appeals reversed, holding (1) Plaintiff's breach of contract claim failed as a matter of law because the contract's consent-to-assignment provision unambiguously gave Defendant an unqualified right to refuse to consent, and (2) Plaintiff's fraud claim failed as a matter of law because Plaintiff could not justifiably rely on an oral promise to do something that was addressed in the written contract. The Supreme Court affirmed, holding (1) Defendant could not have breached the contract as a matter of law because the plain language of the contract unambiguously entitled Defendant to withhold its consent to a proposed assignment; and (2) where the written terms of the contract controlled Plaintiff could not justifiably rely on an oral statement. View "Barrow-Shaver Resources Co. v. Carrizo Oil & Gas, Inc." on Justia Law