James H. Coleman Mike Prewitt Capital of Texas Properties, Inc. And C/S Twin Rock Joint Venture v. Douglas O. Hunter and Bernard Snyder

Coleman v. Hunter TEXAS COURT OF APPEALS, THIRD DISTRICT, AT AUSTIN NO. 03-94-00317-CV James H. Coleman, Mike Prewitt, Capital of Texas Properties, Inc., and C/S Twin Rock Joint Venture, Appellants v. Douglas O. Hunter and Bernard Snyder, Appellees FROM THE DISTRICT COURT OF TRAVIS COUNTY, 200TH JUDICIAL DISTRICT NO. 93-13777, HONORABLE MARGARET COOPER, JUDGE PRESIDING Appellants James Coleman, Mike Prewitt, Capital of Texas Properties, Inc., and C/S Twin Rock Joint Venture ("Defendants") challenge a summary judgment in favor of appellees Douglas Hunter and Bernard Snyder ("Plaintiffs"). The trial court found as a matter of law that Defendants owed Plaintiffs commissions pursuant to an agreement between the parties. Defendants appeal contending, inter alia, that summary judgment was improper because Plaintiffs failed to prove conclusively that the agreement was in effect at the time of the sale in question. We will reverse and remand. FACTUAL AND PROCEDURAL BACKGROUND Plaintiffs and Defendants were parties to an agreement providing for a commission to be paid to Plaintiffs in the event a company called Southwest Realty Advisors, Inc. ("Southwest") or its assignees acquired an interest in two tracts of land known as the "Twin Rock" and "Bluffside" properties. Section 3.3 of the agreement provided additional compensation to Plaintiffs if the Defendants performed "any additional real estate transactions with Southwest in Austin." The final provision of the agreement, section 6.4, stated: "This agreement shall become effective on the date when it is executed by the last of the parties to do so." Defendants signed the agreement on September 4, 1992 (Coleman and Prewitt) and September 9, 1992 (Capital of Texas Properties, Inc. and C/S Twin Rock Joint Venture); Plaintiffs signed the agreement on September 22, 1992 (Snyder) and September 25, 1992 (Hunter). On September 18, 1992, Coleman purchased property known as the "Jollyville tract" and that same day sold it to Property Trust of America, an assignee of Southwest. Relying on section 3.3 of the agreement, Plaintiffs requested compensation from Defendants on the sale of the Jollyville tract. When Defendants refused, Plaintiffs sued for breach of contract. The trial court rendered summary judgment in favor of Plaintiffs, awarding damages of $136,825.31 plus interest for the sale of the Jollyville tract. Defendants appeal from this summary judgment contending, inter alia, that Plaintiffs failed to prove the agreement was in effect at the time of the Jollyville transaction. DISCUSSION A party seeking to recover upon a claim may, at any time after the adverse party has appeared or answered, move for summary judgment. Tex. R. Civ. P. 166a(a). The movant must establish entitlement to summary judgment on the issues by conclusively proving all essential elements of the cause of action. City of Houston v. Clear Creek Basin Auth., 589 S.W.2d 671, 678 (Tex. 1979). The applicability of a contract to a transaction is an essential element of a cause of action for breach of contract. See Bailey, Vaught, Robertson & Co. v. Remington Invs., Inc., 888 S.W.2d 860, 865 (Tex. App.Dallas 1994, no writ); McCulley Fine Arts Gallery, Inc. v. X Partners, 860 S.W.2d 473, 477 (Tex. App.El Paso 1993, no writ). On appeal, we review the propriety of a summary judgment under the standards expressed in Nixon v. Mr. Property Management Co., 690 S.W.2d 546, 548-49 (Tex. 1985). Plaintiffs have not met their summary-judgment burden of establishing, as a matter of law, that the Jollyville transaction was covered by the contract. Plaintiffs' own summary-judgment evidence reflects that the Jollyville transaction occurred on September 18, 1992. Section 6.4 of the agreement clearly states that the "agreement shall become effective on the date when it is executed by the last of the parties to do so." (Emphasis added.) Plaintiffs were the last of the parties to sign the agreement--Snyder on September 22, 1992 and Hunter on September 25, 1992. Both signed after the sale of the Jollyville tract. On this evidence, it does not conclusively appear that the Jollyville transaction was covered by the contract. Plaintiffs raise two arguments in an attempt to dilute the strength of this evidence. First, they contend that Defendants became bound when they signed the agreement and, therefore, it applies to all transactions contemplated by the parties after Defendants signed. It is true that parties can make a written contract and agree that it will be binding when signed by only one of them. Rea v. Simmons & Simmons Constr. Co., 275 S.W.2d 747, 750-51 (Tex. Civ. App.San Antonio), aff'd, 286 S.W.2d 415 (Tex. 1955). However, when a contract containing mutual obligations has been reduced to writing in the form of a complete contract and signed by one of the parties, this is strong proof, absent any evidence to the contrary, that the other party was also to sign the contract before it was to become binding. Id. at 751. In the present case, the only evidence concerning the effective date of the contract is section 6.4 itself, which states the contract is effective when executed by the last of the parties. At a minimum, there is doubt as to whether the parties intended to disregard the clear language of section 6.4; summary judgment is therefore inappropriate. See Taylor v. Bonilla, 801 S.W.2d 553, 557 (Tex. App.Austin 1990, writ denied) ("Summary judgment is rarely proper when the cause involves an issue inherently for the fact-finder, such as intent."). Plaintiffs rely solely on Gulf Oil Corp. v. Spence & Howe Construction Co., 356 S.W.2d 382 (Tex. Civ. App.Houston 1962), aff'd, 365 S.W.2d 631 (Tex. 1963). Gulf Oil is distinguishable on several grounds. Most significantly, the contract in question there did not contain the express language that it would be effective only when the last of the parties executed it. In fact, the written contract indicated that by oral agreement it was intended to cover work commenced prior to execution by the parties. Id. at 385. Additionally, in holding that the parties intended the contract to relate to work prior to its execution, the court relied heavily on the prior course of dealing between the parties. Id. at 386. None of these circumstances exist here. Finally, Plaintiffs argue that Defendants failed to timely raise the issue of the effective date of the contract to the trial court, thereby waiving the issue on appeal. See Tex. R. App. P. 52(a). Plaintiffs misconstrue their own summary-judgment burden. As movants, Plaintiffs had the burden of proof on all essential elements of the contract action, including applicability of the agreement to the Jollyville transaction. See Clear Creek, 589 S.W.2d at 678. Since Plaintiffs failed to meet this burden, we sustain Defendants' third point of error. Because this holding alone requires reversal of the summary judgment, we need not address Defendants' other points of error or Plaintiffs' cross-points. CONCLUSION We reverse the summary judgment and remand the cause to the trial court for further proceedings. J. Woodfin Jones, Justice Before Chief Justice Carroll, Justices Aboussie and Jones Reversed and Remanded Filed: May 31, 1995 Do Not Publish