Richard W. Opperman, Jr. v. Randal Scott Opperman and Lorri Opperman

In The
Court of Appeals
Seventh District of Texas at Amarillo
________________________

No. 07-12-00033-CV
________________________

RICHARD W. OPPERMAN, JR., APPELLANT

V.

RANDAL SCOTT OPPERMAN AND LORRI OPPERMAN, APPELLEES

On Appeal from the 236TH District Court
Tarrant County, Texas
Trial Court No.236-242458-09, Honorable Tom Lowe, Presiding

December 9, 2013

MEMORANDUM OPINION
Before QUINN, C.J., and CAMPBELL and PIRTLE, JJ.

Richard W. Opperman, Jr., Appellant, appeals the entry of an order granting a

take-nothing summary judgment in favor of Randal Scott Opperman and Lorri

Opperman, Appellees, on Appellant’s breach of fiduciary duty claim. Stated in five

issues, Appellant asserts the trial court erred by denying (1) his motion to continue the

summary judgment hearing and (2) his opportunity to cure any defects in the form of his

summary judgment evidence. He also contends (3) Appellees’ objections to the form of
his summary judgment evidence were waived, and the trial court erred in granting

Appellees’ (4) traditional and (5) no-evidence motion for summary judgment. We affirm

in part and reverse in part the trial court’s order granting summary judgment and

remand this case for further proceedings consistent with this opinion.

BACKGROUND

Opperman Electric Company, Inc. (“Opperman Electric”) is a closely-held Texas

corporation, originally incorporated in September 1986. Its initial Directors were Richard

W. Opperman, Sr., Richard W. Opperman, Jr., and Randal Scott Opperman. Randal

Scott Opperman was elected to serve as President, and his wife, Lorri Opperman, was

elected to serve as Secretary. Appellant was elected to serve as Vice-President. The

parties originally agreed that Randal Scott Opperman would own ninety percent of the

outstanding shares (900 shares) and Appellant, his brother, would own the remaining

ten percent (100 shares). According to Appellant, the parties also agreed that all

corporate income would be distributed according to their ownership interests. Although

Appellant and Appellees continued to serve in their respective capacities as officers and

directors from the corporation’s inception until it was sold to a third party on May 30,

2008, in 2009 a dispute arose as to whether their ownership interests had changed.

Appellant contends he still owned a ten percent interest in the corporation at the time of

sale, whereas Appellees contend Appellant effectively sold his shares to Randall Scott

Opperman in 2002.

As a result of this dispute, Appellant filed suit against Appellees in December

2009, contending their conduct as corporate officers and directors breached fiduciary

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duties owed by them to the corporation and to Appellant. Specifically, Appellant alleged

the 2008 sale of the corporation to a third party was “unfair” and “inequitable,” and he

sought both an accounting and damages representing ten percent of the corporation’s

net income from 1986 through 2008. In support of his claim of unfair dealings,

Appellant alleged that in April 2008, just prior to the sale of the corporation, Appellees

demanded he sign documents that inaccurately reflected a transfer of his ten percent

interest in the corporation to Randal Scott Opperman in May 2002. Appellant sought

“actual damages,” including mental anguish, exemplary damages, disgorgement of

profits, interest, court costs and attorney’s fees.

In July 2011, more than a year and one-half after suit was filed, Appellees filed

both a Traditional and No-Evidence Motion for Summary Judgment asserting there was

no evidence of an essential element of Appellant’s breach of a fiduciary duty claim, to-

wit: that Appellant still owned an interest in the corporation and that, as a result thereof,

they owed him any fiduciary duty. They also sought summary judgment on a variety of

affirmative defenses including limitations, lack of standing, waiver, laches and quasi-

estoppel. On August 12, 2011, Appellant filed a motion to continue the summary

judgment hearing set for September 2 until October 14, the discovery cutoff date.

Appellant’s counsel asserted, via affidavit, that additional time was needed to secure

documentary evidence regarding the sale of Opperman Electric in 2008, and to depose

the new owners and Appellees. The trial court denied the motion for continuance and

Appellant timely responded to Appellees’ motion for summary judgment.

On September 2, the day of the summary judgment hearing, Appellees filed

objections to Appellant’s summary judgment evidence alleging his exhibits had not been

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properly authenticated, contained hearsay and were conclusory. On September 8,

without expressly ruling on Appellees’ objections and without specifying the basis for the

summary judgment ruling, the trial court issued its order stating, in pertinent part, the

following:

Upon consideration of [Appellees’ motion], the response, the reply, and
the evidence submitted, and after hearing arguments of counsel, the Court
is of the opinion that Defendants’ . . . Motion for Summary Judgment
should be GRANTED.

IT IS, THEREFORE, ORDERED, ADJUDGED AND DECREED that
Defendants’ . . . Motion for Summary Judgment is hereby GRANTED and
that all of Plaintiff’s claims asserted against Defendants in the above-
numbered cause are hereby DISMISSED WITH PREJUDICE to the
refilling of same.

Appellant now seeks to set aside that order.

DISCUSSION

Because we find issues three, four and five to be dispositive of this appeal, we

pretermit issues one and two, and begin our discussion with issue three. See TEX. R.

APP. P. 47.1. Issues four and five will be discussed together.

ISSUE THREE
APPROPRIATE SUMMARY JUDGMENT EVIDENCE

While Appellant’s third issue does not specifically complain of error by the trial

court, for purposes of discussion we construe the issue as contending the trial court

erred in sustaining Appellees’ objections to Appellant’s summary judgment evidence. In

that regard, we note that on July 28, 2011, Appellees’ filed their traditional and no-

evidence motion for summary judgment and, in response thereto, on August 26, 2011,

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Appellant filed his summary judgment evidence consisting of his personal affidavit and

supporting exhibits. On September 2, 2011, the date set for submission of Appellees’

summary judgment motion, Appellees filed an objection to Appellant’s summary

judgment evidence; however, they never obtained a ruling on those objections.

Appellant now attacks Appellees’ contention that all or a part of his summary judgment

evidence was properly excluded by the trial court when it implicitly sustained their

objections.

Addressing first Appellees’ contention the trial court implicitly sustained their

objections by granting the summary judgment motion, we note there is a split of

authority among the intermediate appellate courts as to whether, pursuant to Rule

33.1(a)(2)(A) of the Texas Rules of Appellate Procedure,1 an objection to summary

judgment evidence can be implicitly granted without a written, signed order. See

Stewart v. Sanmina Tex., L.P., 156 S.W.3d 198, 206 (Tex. App.—Dallas 2005, no pet.).

Because this case was transferred to this Court from the Second Court of Appeals, we

must decide the case in accordance with the precedent of the transferor court under

principles of stare decisis. TEX. R. APP. P. 41.3. The Second Court of Appeals has held

that an objection claiming that an affidavit presented as summary judgment evidence is

“not based on personal knowledge, contains hearsay, and is conclusory” (as was done

here) is not implicitly sustained by the granting of summary judgment. See Law Office

of David E. Williams, II, P.C. v. Fort Worth Tex. Magazine Venture, LP, No. 02-10-

00373-CV, 2011 Tex. App. LEXIS 5157, at *7 (Tex. App.—Fort Worth July 7, 2011, no

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TEX. R. APP. P. 33.1(a)(2) provides that one of the prerequisites to presenting a complaint for
appellate review is that “the trial court: (A) ruled on the request, objection, or motion, either expressly or
implicitly; or (B) refused to rule on the request, objection, or motion, and the complaining party objected to
the refusal.”)

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pet.) (mem. op.). We agree with our sister court that the better practice would be for the

trial court to disclose, in writing, its ruling on all summary judgment evidence before the

time it enters an order granting or denying summary judgment. Id. Accordingly, on this

record, we decline the invitation to conclude the trial court implicitly sustained any of

Appellees’ objections.

Furthermore, we note the order granting summary judgment expressly provides

the trial court considered “the response, the reply and the evidence submitted.”

Appellant’s summary judgment evidence, the Affidavit of Richard W. Opperman, Jr. and

the exhibits attached thereto, was part of that evidence submitted. Accordingly, we find

that evidence was properly before and considered by the trial court in its summary

judgment ruling. Because Appellant’s summary judgment evidence was not excluded,

the trial court did not err in that regard. Appellant’s third issue is overruled.

ISSUES FOUR AND FIVE
SUMMARY JUDGMENT STANDARD OF REVIEW

If, as here, a trial court’s order granting summary judgment does not specify the

basis for the trial court’s ruling, the summary judgment will be affirmed if any of the

theories advanced by the movant are meritorious. Joe v. Two Thirty Nine J.V., 145

S.W.3d 150, 157 (Tex. 2004). In determining whether a theory advanced by the movant

is meritorious we review a trial court’s summary judgment de novo. Provident Life &

Accident Ins. Co. v. Knott, 128 S.W.3d 211, 215 (Tex. 2003) (citing FM Props.

Operating Co. v. City of Austin, 22 S.W.3d 868, 872 (Tex. 2000)). Summary judgment

is appropriate when there is no genuine issue as to any material fact and judgment

should be granted in favor of the movant as a matter of law. Diversicare Gen. Partner,

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Inc. v. Rubio, 185 S.W.3d 842, 846 (Tex. 2003) (citing KPMG Peat Marwick v. Harrision

Co. Hous. Fin. Corp., 988 S.W.2d 746, 748 (Tex. 1999)). All doubts are resolved

against the movant, and the evidence viewed in the light most favorable to nonmovants.

Sudan v. Sudan, 199 S.W.3d 291, 292 (Tex. 2006); Shah v. Moss, 67 S.W.3d 836, 842

(Tex. 2001).

A defendant moving for traditional summary judgment must (1) conclusively

negate at least one element of each of the plaintiff’s causes of action or (2) conclusively

establish each element of an affirmative defense as to each cause of action. Frost Nat’l

Bank v. Fernandez, 315 S.W.3d 494, 508 (Tex. 2010); Science Spectrum, Inc. v.

Martinez, 941 S.W.2d 910, 911 (Tex. 1997). Under the no-evidence summary judgment

rule, a defendant is entitled to summary judgment if, after adequate time for discovery,

there is no evidence of one or more essential elements of a claim on which the

nonmovant has the burden of proof at trial. TEX. R. CIV. P. 166a(i). If the nonmovant

brings forward more than a scintilla of probative evidence that raises a genuine issue of

material fact with regard to the essential elements the movant contends to be lacking,

then a no-evidence summary judgment is not proper. Smith v. O’Donnell, 288 S.W.3d

417, 424 (Tex. 2009); King Ranch, Inc. v. Chapman, 118 S.W.3d 742, 751 (Tex. 2003),

cert. denied, 541 U.S. 1030, 124 S.Ct. 2097, 158 L.Ed.2d 711 (2004).

BREACH OF FIDUCIARY DUTY

Appellant has asserted an individual claim for damages based upon an alleged

breach of fiduciary duty. The elements of a breach of fiduciary duty claim are: (1) a

fiduciary relationship between the plaintiff and defendant; (2) a breach of the duty by the

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defendant; and (3) injury to the plaintiff or benefit to the defendant. See Jones v.

Blume, 196 S.W.3d 440, 447 (Tex. App.—Dallas 2006, pet. denied).

Here, Appellees contend their summary judgment evidence negates an essential

element of Appellant’s claim, to-wit: the existence of a fiduciary duty, because Appellant

was not a shareholder after May 2002. In his response to Appellees’ motion for

summary judgment, Appellant’s affidavit contends that “[f]rom the inception of

Opperman Electric Company in 1986 until its sale in 2008, I was a 10% owner.”

Appellant further specifically states he did not sell his ownership interest to Randal Scott

Opperman in May of 2002. Appellant supports his contention that a genuine issue of

material fact exists with respect to his claim of shareholder status because he received

a $2,000 dividend in October 2005 and Opperman Electric’s tax returns from 2003

through 2007 indicate he owned shares of the corporation’s common stock. Because

we must resolve all doubts against Appellees as summary judgment movants, and view

the nonmovant’s summary judgment evidence in the light most favorable to the

nonmovant, we find these allegations alone raise a genuine issue of material fact as to

whether or not he was a shareholder at the time of sale of Opperman Electric in May

2008. Because this fact issue exists, Appellees have not established as a matter of law

that a fiduciary relationship did not exist between them based upon their contention that

Appellant was not a shareholder.

Our inquiry must not, however, end there. Appellant’s status as a co-shareholder

in a closely-held corporation alone does not automatically create a fiduciary relationship

between co-shareholders. Kaspar v. Throne, 755 S.W.2d 151, 155 (Tex. App.—Dallas

1988, no writ). “A co-shareholder in a closely held corporation does not as a matter of

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law owe a fiduciary duty to his co-shareholder.” Pabich v. Kellar, 71 S.W.3d 500, 504

(Tex. App.—Fort Worth 2002, pet. denied); Hoggett v. Brown, 971 S.W.2d 472, 488

(Tex. App.—Houston [14th Dist.] 1997, pet. denied). Even in the context of

disproportionate ownership interests, the vast majority of intermediate appellate courts

of this state have declined to recognize a broad formal fiduciary relationship between

majority and minority shareholders that applies as a matter of law to every transaction

between them. Cardiac Perfusion Servs. v. Hughes, 380 S.W.3d 198, 214 (Tex. App.—

Dallas 2012, pet. filed); Allen v. Devon Energy Holdings, L.L.C., 367 S.W.3d 355, 391

(Tex. App.—Houston [1st Dist.] 2012, pet. filed). However, that authority

notwithstanding, many courts have recognized that, depending on the circumstances of

each case, an informal duty may exist between co-shareholders where there is a

confidential relationship between the parties. See generally Willis v. Donnelley, 199

S.W.3d 262, 277 (Tex. 2006) (holding that while co-shareholders in closely-held

corporation do not owe a formal fiduciary duty to one another, they could owe an

informal duty depending on the given circumstances); Devon Energy Holdings, L.L.C.,

367 S.W.3d at 391 (recognizing a fiduciary duty between co-shareholders in the context

of a redemption where the majority ownership interest had dominant control over the

business); Kaspar, 755 S.W.2d at 155 (finding that even though shareholders in closely-

held corporation did not owe a fiduciary duty to one another as a matter of law,

judgment was reversed because jury was not asked if an informal duty exists).

Furthermore, officers or directors may owe a fiduciary duty to individual shareholders if

a contract or confidential relationship exists between them in addition to the corporate

relationship. See Somers v. Crane, 295 S.W.3d 5, 11 (Tex. App.—Houston [1st Dist.]

2009, pet. denied) (citing Cotton v. Weatherford Bancshares, Inc., 187 S.W.3d 687, 698

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(Tex. App.—Fort Worth 2006, pet denied)). The existence of such “confidential

relationships” giving rise to an informal duty is usually a question of fact, although when

the issue is one of no evidence, it becomes a question of law.” See Crim Truck &

Tractor Co. v. Navistar Int’l Transp. Corp., 823 S.W.2d 591, 594 (Tex. 1992).

Courts finding such an informal fiduciary duty “have done so partly based on the

rationale that shareholders in a closely-held corporation are more realistically viewed as

partners and therefore owe each other duties analogous to partners in a partnership.”

Devon Energy Holdings, L.L.C., 367 S.W.3d at 390. Other courts have focused on the

majority shareholders’ domination or control of the corporation’s affairs, while still others

have focused on the majority shareholder’s access to insider or special information. Id.

In that regard, the Texas Supreme Court has held that a confidential relationship

“exists where a special confidence is reposed in another who in equity and good

conscience is bound to act in good faith and with due regard to the interest of the one

reposing confidence.” See Texas Bank & Trust Co. v. Moore, 595 S.W.2d 502, 507

(Tex. 1980). See also Crim Truck, 823 S.W.2d at 594 ((finding that a confidential

relationship exists where influence has been acquired and abused, and confidence has

been reposed and betrayed). Thus, “[a] person is justified in placing confidence in the

belief that another party will act in his or her best interest only where he or she is

accustomed to being guided by the judgment or advice of the other party, and there

exists a long association in a business relationship, as well as personal relationship.”

See Hoggett, 971 S.W.2d at 488. See also Flanary v. Mills, 150 S.W.3d 785, 794 (Tex.

App.—Austin 2004, pet. denied) (holding that a confidential relationship existed

between uncle and nephew where nephew always had faith in his uncle, looked up to

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his uncle and trusted him, worked with his uncle in the oil fields for more than twenty

years, served together as partners in a roofing business before forming the corporation

that was the subject of the litigation, left the finances of the roofing partnership and later

the corporation in his uncle’s hands, and his uncle told him not to worry about the

corporation’s profitability).

Here, Appellees contend there is no evidence of a confidential relationship

between Appellant and Appellees giving rise to an informal fiduciary duty. Appellant

counters arguing that such a duty does exist by virtue of their relationship as co-officers

and co-directors of the corporation. Appellant further contends their familial relationship

creates a confidential relationship giving rise to an informal fiduciary duty. In this

regard, Appellees themselves acknowledge that a special relationship existed between

the parties where they went “over and above” the call of familial relationships to care for

Appellant. But see Texas Bank and Trust Co. v. Moore, 595 S.W.2d 502, 508 (Tex.

1980) (finding that, standing alone, neither the existence of a family relationship nor the

bestowing of benefits establishes a fiduciary relationship). In the context of a defensive

motion for summary judgment, because Appellant has presented at least a scintilla of

probative evidence raising a genuine issue of material fact concerning whether a

contract or confidential relationship existed between the parties giving rise to an

informal fiduciary relationship and whether Appellees breached that duty, trial court’s

traditional and no-evidence summary judgment was improper. Appellees have not

established as a matter of law that a fiduciary relationship did not exist between them.

Accordingly, we find the trial court erred in granting summary judgment on that basis

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because Appellees have not negated the existence of a fiduciary relationship as a

matter of law.

LIMITATIONS

Appellees assert that Appellant’s claims are barred by the applicable statute of

limitations because his claims or cause of action “began to run when he ceased being a

shareholder of Opperman Electric as of May 28, 2002” when Appellant allegedly sold

his shares to Randal Scott Opperman. As more fully discussed hereinabove, Appellant

has established a material fact issue with respect to these claims. Therefore, if it

granted summary judgment on the basis of limitations, the trial court erred because

Appellees did not conclusively establish each element of the affirmative defense of

limitations.

LACK OF STANDING

In his First Amended Petition (Appellant’s active pleading at the time summary

judgment was granted) Appellant sought to “assert his right as [a] 10% shareholder of

this close corporation,” by alleging Appellees, as officers of the corporation, breached

fiduciary duties owed “to the corporation they serve, as well as to individual

shareholders.” Texas corporate law does provide that a cause of action for injury to the

property of a corporation, or the impairment or destruction of its business, is vested in

the corporation, as distinguished from its stockholders, even though it may result

indirectly in the loss of earnings to stockholders. Redmon v. Griffith, 202 S.W.3d 225,

237 (Tex. App.—Tyler 2006, pet. denied); Bilodeau v. Webb, 170 S.W.3d 904, 912

(Tex. App.—Corpus Christi 2005, pet. denied) (collected cases cited therein). See

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Lamajak, Inc. v. Frazin, 230 S.W.3d 786, 794 (Tex. App.—Dallas 2007, no pet.) (“It is

well established that a corporate shareholder, even of a wholly owned corporation,

cannot recover damages personally for a wrong done to the corporation even though he

[or she] may be injured by that wrong.”) Accordingly, to the extent that Appellant’s claim

can be construed as asserting a claim or cause of action on behalf of the corporation,

he does not have standing to do so and the trial court did not err in granting summary

judgment on that basis, as to those claims.

THE DOCTRINES OF WAIVER, LACHES AND QUASI-ESTOPPEL

Appellees further contend Appellants claims are barred by the doctrines of

waiver, laches and quasi-estoppel because the summary judgment evidence

establishes the following “undisputed facts”: (1) Appellant was removed as a

shareholder “effective” May 28, 2002, (2) his removal as a shareholder was at his

request to avoid any non-compete obligations associated with the 2008 sale, (3) he

never questioned the source or purpose of corporate distributions, (4) he never

requested an accounting, (5) he had unlimited access to the corporate books and

records, (6) he was never denied access to the corporate books and records, (7) he

knew the location of the books and records, (8) he used the same accountant as

Opperman Electric, and (9) he repeatedly utilized Opperman Electric funds for his own

personal benefit. Because Appellant’s affidavit was properly before the trial court, these

allegations simply were not “undisputed.” Therefore, because we must resolve all

doubts against Appellees, as movants, and view the summary judgment evidence in the

light most favorable to Appellant, as the nonmovant, we find Appellant has presented at

least a scintilla of probative evidence raising a genuine issue of material fact such that

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Appellees have not established every element of these affirmative defenses as a matter

of law. Accordingly, if the trial court granted summary judgment on the basis of the

affirmative defenses of waiver, laches or quasi-estoppel, we find the trial court erred in

doing so.

CONCLUSION

Issues four and five are overruled and summary judgment is affirmed as to any

and all claims or causes of action asserted on behalf of the corporation. Otherwise,

issues four and five are sustained and the trial court’s order granting summary judgment

is reversed. This cause is remanded to the trial court for further proceedings consistent

with this opinion.

Patrick A. Pirtle
Justice

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