NO. 12-08-00371-CV
IN THE COURT OF APPEALS
TWELFTH COURT OF APPEALS DISTRICT
TYLER, TEXAS
DONALD EMMETT WARD, § APPEAL FROM THE 1ST
SHERREL SCARBOROUGH
AND DENNIS SCARBOROUGH,
APPELLANTS
§ JUDICIAL DISTRICT COURT
V.
THOMAS LADNER,
APPELLEE § SABINE COUNTY, TEXAS
OPINION ON REHEARING
Thomas Ladner filed a motion for rehearing, to which Donald Emmett Ward, Sherrel
Scarborough, and Dennis Scarborough responded. Ladner‟s motion for rehearing is granted. We
withdraw our opinion and judgment of January 6, 2010 and substitute the following opinion and
corresponding judgment in its place.
Donald Emmett Ward, Sherrel Scarborough, and Dennis Scarborough (collectively
“Appellants”) appeal the trial court‟s judgment entered in favor of Thomas Ladner. Appellants
raise four issues on appeal. We affirm.
BACKGROUND
Dillis Ward and his wife, Gertie, owned property on the shore of Toledo Bend Reservoir
in Sabine County, Texas (the “property”). The property, on which stood a small store with living
quarters, was surrounded by land owned by the Sabine River Authority of Texas. In 1987, Dillis
Ward died. Thereafter, Dillis Ward‟s son, Donald Ward (“Ward”), had a conversation with
Ladner concerning the property. According to Ward, the two entered into an oral agreement
whereby Ladner would rent the property. However, according to Ladner, the two orally agreed
that he would purchase the property.
Ladner lived on the property during the late 1980s and, since that time, has received
rental income from the campsites located predominantly on the adjacent property owned by the
Sabine River Authority. Ward visited the property occasionally over the years and contacted
Ladner prior to these visits. Ward‟s daughter, Sherrel Scarborough, likewise visited the property
occasionally during the relevant period and also contacted Ladner prior to her arrival.
In 1996, Gertie died. In 2007, by deed of gift, Ward transferred the property to Sherrel
Scarborough and her husband, Dennis Scarborough. In January 2007, the Scarboroughs moved
to the property. In August 2007, the Scarboroughs gave notice to Ladner that they would not
continue to rent the property to him.
Ladner filed the instant suit seeking a declaratory judgment that he and Ward entered into
a binding contract for the purchase of the property. Ladner further sought specific performance
of an oral real estate contract. Ladner also made allegations of, among other things, trespass to
try title and promissory estoppel. Thereafter, Ladner sought a temporary restraining order. In
his sworn petition and affidavit filed in support of his petition for temporary restraining order,
Ladner averred that Ward agreed to sell the property for $160,000 “paid at $500 per month with
no interest (320 months or 26.6 years to pay off).” Ladner further alleged that he “agreed to this
arrangement and began paying the monthly payments to Donald Ward by check mailed to
Donald Ward‟s address in Temple, Texas.”
Following the presentation of evidence, the matter was submitted to the jury. Ultimately,
the jury found that the parties had entered into an oral agreement for the sale of the property.
The jury further found that Ladner (1) made monthly payments on the $160,000 beginning in
1987 and continuing until October 2007, (2) took possession of the property in 1987 and retained
such possession to the present time, and (3) made permanent and valuable improvements upon
the property beginning in 1987. The trial court entered judgment in Ladner‟s favor and ordered
specific performance of the oral contract. By its judgment, the trial court further ordered the
transfer of title to the property to Ladner and that Ladner pay the remainder of the unpaid
balance of $160,000 at a rate of $625 per month.1 This appeal followed.
1
Appellants were awarded a lien against the property to secure Ladner‟s indebtedness until the
indebtedness was fully paid.
2
VARIANCE
In their first issue, Appellants argue that the trial court abused its discretion by submitting
Question 1 because the evidence at trial regarding the terms of the oral contract for sale of real
estate differed materially and substantially from the terms of the contract alleged in Ladner‟s live
pleadings.
Generally, we review an issue of whether a question was improperly submitted to the jury
for abuse of discretion. See Recognition Commc’ns, Inc. v. Am. Auto. Ass’n, Inc., 154 S.W.3d
878, 885 (Tex. App.–Dallas 2005, pet. denied); see also Tex. Dep't of Human Servs. v. E.B.,
802 S.W.2d 647, 649 (Tex. 1990)). A trial court abuses its discretion where it submits a jury
question that is neither supported by the pleadings nor tried by consent. See Recognition
Commc’ns, Inc., 154 S.W.3d at 885. A trial court abuses its discretion if its action is arbitrary,
unreasonable, and without reference to any guiding rules or principles or where it clearly fails to
analyze or apply the law correctly. Downer v. Aquamarine Operators, Inc., 701 S.W.2d 238,
241 (Tex. 1985).
The Texas Rules of Civil Procedure are designed to prevent a variance between pleading
and proof from having the effect of precluding any recovery. See, e.g., TEX. R. CIV. P. 66, 67,
90. Nonetheless, a plaintiff in an action on a contract must recover, if at all, on the cause of
action as it has been alleged. See Hollingsworth v. Nw. Nat’l Ins. Co., 522 S.W.2d 242, 246
(Tex. Civ. App.–Texarkana 1975, no writ). If the proof shows a contract essentially different
from the contract alleged, the action will fail. See Sanchez v. Hernandez, 456 S.W.2d 497, 498
(Tex. Civ. App.–San Antonio 1970, writ ref‟d n.r.e.).
Yet, not every variance between the contract pleaded and the proof offered is a fatal one.
Id. For instance, a variance arising from an attempt to plead the evidence relied on to establish
the existence of an oral contract is not fatal unless it tends to mislead or surprise the opposing
party. See Bland v. Cruce, 238 S.W. 720, 722 (Tex. Civ. App.–Dallas 1922, no writ).
The Texas Rules of Appellate Procedure control the required contents and organization
for an appellant's brief. See TEX. R. APP. P. 38.1. One of those requirements is that an
appellant's brief must contain a clear and concise argument, including appropriate citations to
authority and the record. See TEX. R. APP. P. 38.1(i). This requirement is not satisfied by merely
uttering brief conclusory statements unsupported by legal citations. Valadez v. Avitia, 238
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S.W.3d 843, 845 (Tex. App.–El Paso 2007, no pet.). Failure to provide substantive analysis of
the legal issue presented results in waiver of the complaint. Id.
In the case at hand, Appellants expressly recognize in their brief that, to be fatal, a
variance must be substantial, misleading, constitute surprise, and be a prejudicial departure from
the pleadings. But Appellants make only a single conclusory reference to this key issue apart
from their recognition of its existence. Specifically, Appellants state, “To plead the terms of one
contract in a sworn pleading, amend the terms claimed in trial testimony, then not be certain of
the terms, then request a Jury issue that is silent as to the terms of the contract is substantially
misleading and constituted surprise ….” Appellants do not set forth any further facts underlying
their being surprised or misled by this variance. As such, we hold that Appellants have waived
the issue. See TEX. R. APP. P. 38.1(i). Appellants‟ first issue is overruled.
SPECIFIC PERFORMANCE
Appellants‟ second and third issues concern the trial court‟s order of specific
performance. In their second issue, Appellants argue that the trial court erred in ordering
specific performance when there was a jury finding that an oral contract existed, but not jury
findings determining the material terms of the contract. In their third issue, Appellants argue that
the trial court erred in overruling their objection to Question 1 of the court‟s charge due to its
failure to make inquiry of the jury concerning essential contract terms or whether Ladner
complied with those terms. Question 1 inquired of the jury as follows: “Did Thomas Ladner and
Donald Ward enter into an oral agreement in 1987 in which Donald Ward agreed to sell the
subject property to Thomas Ladner?” The jury answered Question 1 in the affirmative.
It is the trial court‟s responsibility to submit a proper charge. See Spencer v. Eagle Star
Ins. Co., 876 S.W.2d 154, 158 (Tex. 1994). One who seeks specific performance of a real estate
contract must prove that he has diligently and timely performed or tendered performance of all
obligations set forth in the contract. Texacally Joint Venture v. King, 719 S.W.2d 652, 653
(Tex. App–Austin 1986, writ ref‟d n.r.e.). Price is an essential term required for the sale of real
property. See Rus-Ann Dev., Inc. v. ECGC, Inc., 222 S.W.3d 921, 927 (Tex. App.–Tyler 2007,
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no pet.).2 Thus, to be entitled to specific performance, Ladner had to prove that he paid the
purchase price agreed to by the parties.3 See King, 719 S.W.2d at 653.
Whether an oral contract existed is a question of fact for the jury. See American
Transfer & Storage Co. v. Reichley, 643 S.W.2d 162, 164 (Tex. Civ. App.–Amarillo 1976, writ
ref‟d). Because price is an essential element of a real estate contract, Ladner was required to
secure a finding on the contract price to be entitled to specific performance.
At the charge conference, Appellants objected to the submission of Question 1 because it
did not contain all of the essential terms alleged by Appellees in their pleadings, one of which
was a contract price. Appellants further sought to submit a charge question that contained the
contract price pleaded by Ladner.
The testimony in the case at hand establishes that both Ward‟s and Ladner‟s memories
concerning some of the details of the transaction had faded during this interim period. Yet, the
testimonies of the two principals did not waiver on certain core facts, which are summarized as
follows: Ladner testified that Ward agreed to sell him the property for $160,000; Ward testified
that no communications concerning an agreement to sell the property ever transpired between
him and Ladner.
Ward‟s testimony that there existed no agreement to sell the property amounts to a
denunciation of the existence of the totality of the agreement, including a $160,000 contract
price. However, there is no testimony of record concerning a contract price other than Ladner‟s
testimony that the agreed price was $160,000.00. Thus, even though Ward‟s denial of the
existence of the contract necessarily included a denial of any agreement concerning the price, the
trial court‟s submission of the question concerning whether the parties reached an agreement, if
answered in the affirmative, necessarily disregards the totality of Ward‟s testimony. As such, if
2
In their brief, Appellants note that in Rus-Ann Devlopment, we “held that terms of the seller financing
„such as how, when, where, how much[,] and to whom payments were made‟ were necessary elements in the
application of specific performance.” See Rus-Ann Dev., 222 S.W.3d at 927. However, according to our opinion in
Rus-Ann Development, the language quoted by Appellants concerns the contentions made by the appellant in that
case. See id. at 928. We did not specifically hold that these terms of seller financing were essential. See id. Rather,
we noted that these terms were provisions of the lease agreement, which the trial court could consider in determining
the terms of a contract to be enforced by specific performance. See id. In the instant case, Appellants do not
expound upon the aforementioned quote from Rus-Ann Development concerning seller financing terms, but rather
focus their argument on the amount of consideration generally. We will likewise concentrate our discussion of
Appellants‟ second and third issues accordingly. See TEX. R. APP. P. 38.1(i).
3
The issue of evidence underlying Ladner‟s payment of consideration, as well as that of his possession of
and making improvements to the property, is discussed in our analysis of Appellants‟ fourth issue.
5
the jury determined that the parties agreed that Ward would sell the subject property to Ladner,
the evidence was conclusive regarding the sales price. Because the evidence was conclusive on
this material term, no jury finding was required. See Bay Rock Operating Co. v. St. Paul
Surplus Lines Ins. Co., 298 S.W.3d 216, 235 (Tex. App.–San Antonio 2009, pet. filed).
Therefore, we hold that the trial court did not err in refusing to submit a question to the jury that
made no inquiry concerning the sales price. We further hold that the trial court did not err in
ordering specific performance absent a jury finding concerning sales price because the evidence
concerning sales price was conclusively established. See Rus-Ann Dev., 222 S.W.3d at 927
(stating that specific performance will be decreed where essential terms of contract are expressed
with reasonable certainty). Appellants‟ second and third issues are overruled.
EVIDENTIARY SUFFICIENCY
In their fourth issue, Appellants argue that the evidence was both legally and factually
insufficient to sustain specific performance under the equitable exception to the statute of frauds.
Legal Sufficiency
A party who challenges the legal sufficiency of the evidence to support an issue upon
which he did not have the burden of proof at trial must demonstrate on appeal that there is no
evidence to support the adverse finding. Bright v. Addison, 171 S.W.3d 588, 595 (Tex. App.–
Dallas 2005, pet. denied). When reviewing a “no evidence” issue, we determine “whether the
evidence at trial would enable reasonable and fair minded people to reach the verdict under
review.” City of Keller v. Wilson, 168 S.W.3d 802, 827 (Tex. 2005). In making this
determination, we must credit favorable evidence if a reasonable finder of fact could, and
disregard contrary evidence unless a reasonable finder of fact could not. Id. The finder of fact is
the sole judge of the credibility of the witnesses and the weight to be assigned to their testimony.
See Canal Ins. Co. v. Hopkins, 238 S.W.3d 549, 557 (Tex. App.–Tyler 2007, pet. denied) (citing
City of Keller, 168 S.W.3d at 819). The finder of fact is free to believe one witness and
disbelieve another, and reviewing courts may not impose their own opinions to the contrary. Id.
Accordingly, we must assume that the finder of fact decided all credibility questions in favor of
the findings if a reasonable person could do so. Id. If a reasonable finder of fact could have
done so, we must assume that the finder of fact chose what testimony to disregard in a way that
favored the findings. See Canal, 238 S.W.3d at 557 (citing City of Keller, 168 S.W.3d at 820).
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A finder of fact “may disregard even uncontradicted and unimpeached testimony from
disinterested witnesses” where reasonable. Canal, 238 S.W.3d at 557 (quoting City of Keller,
168 S.W.3d at 819–20).
Moreover, it is within the finder of fact‟s province to resolve conflicts in the evidence.
Canal, 238 S.W.3d at 557 (citing City of Keller, 168 S.W.3d at 820). Consequently, we must
assume that, where reasonable, the finder of fact resolved all conflicts in the evidence in a
manner consistent with the findings. Id. Where a reasonable finder of fact could resolve
conflicting evidence either way, we must presume the finder of fact did so in favor of the
findings. Canal, 238 S.W.3d at 557 (citing City of Keller, 168 S.W.3d at 821). Where
conflicting inferences can be drawn from the evidence, it is within the province of the finder of
fact to choose which inference to draw, so long as more than one inference can reasonably be
drawn. Id. Therefore, we must assume the finder of fact made all inferences in favor of the
findings if a reasonable person could do so. Id.
Additionally, any ultimate fact may be proved by circumstantial evidence. See Wal-Mart
Stores, Inc. v. Bertrand, 37 S.W.3d 1, 12 (Tex. App.–Tyler 2000, pet. denied). However, the
legal equivalent of no evidence exists when circumstantial evidence gives life to inferences
equally consistent with two different propositions. Id. Furthermore, when circumstances are
equally consistent with either of two facts and nothing shows that one is more probable than the
other, neither fact can be inferred and the no evidence challenge must be sustained. Id.
Equitable Exception to the Statute of Frauds
The statute of frauds is an affirmative defense requiring that certain specified classes of
contracts be in writing to be enforceable. See TEX. R. CIV. P. 94; Gerstacker v. Blum
Consulting Engr’s, Inc., 884 S.W.2d 845, 850 (Tex. App.–Dallas 1994, writ denied). Whether a
contract falls within the statute of frauds is a question of law. Gerstacker, 884 S.W.2d at 850.
The instant case concerns allegations of a contract for the sale of real estate. Therefore, the
parties‟ contract, if any, is governed by the statute of frauds. See TEX. BUS. & COM. CODE ANN.
§ 26.01(a), (b)(4) (Vernon 2009) (contract for sale of real estate not enforceable unless in writing
and signed by person charged with agreement).
However, there exists an equitable exception to the statute of frauds. See Hooks v.
Bridgewater, 111 Tex. 122, 229 S.W. 1114, 1116 (Tex. 1921). In Hooks, the Texas Supreme
Court held that to relieve a parol sale of land from the operation of the statute of frauds, three
7
things are necessary: (1) payment of the consideration, whether it be in money or services; (2)
possession by the vendee; and (3) the making by the vendee of valuable and permanent
improvements upon the land with the consent of the vendor.4 Id. The court described these three
elements as “indispensable.” Id.
In the case at hand, the burden was upon Ladner to secure jury findings to support this
equitable exception. See Choi v. McKenzie, 975 S.W.2d 740, 743 (Tex. App.–Corpus Christi
1998, pet. denied). He sought to do so by the submission of Questions 2, 3, and 4.
Payment of Consideration
Question 2 queries, “Did Thomas Ladner make monthly payments on the $160,000.00
beginning in 1987 and continuing until October 2007?” As set forth previously, since the jury
determined that the parties agreed that Ward would sell the subject property to Ladner, the
evidence was conclusive regarding the $160,000 sales price. Based on our review of the record,
we note that there is evidence that either Ladner or someone acting on his behalf made multiple
payments to Ward during the time period in question. Ladner testified that he paid $410 per
month from 1987 through 2001 and, thereafter, paid $625 per month. Ladner further testified
that he was “up to date” on his payments.5 Moreover, Ladner confirmed that such payments
were made over one hundred fifty-six months. We hold that there is legally sufficient evidence to
support the jury‟s answer to Question 2.
Appellants argue that payments of money by Ladner to Ward is equally consistent with
the competing arguments proposed by the parties. In other words, according to Appellants, there
is no evidence tending to support that it is more probable that these payments were made as
payment toward the purchase of the property than it is that the payments were made as rent.
Thus, neither purpose for the payment of these monies can be inferred and Ward‟s no evidence
challenge must be sustained with regard to Question 2. See Bertrand, 37 S.W.3d at 12.
However, the jury found in its answer to Question 1 that Thomas Ladner and Donald Ward
entered into an oral agreement in which Donald Ward agreed “to sell the subject property” to
Thomas Ladner (emphasis added). Determining facts is the exclusive province of the finder of
fact in the trial court. See Barnes v. Western Alliance Ins. Co., 844 S.W.2d 264, 270 (Tex.
4
The court noted that absent such improvements, it would consider the presence of such facts as would
make the transaction a fraud upon the purchaser if it were not enforced. Id.
5
Ladner‟s trial testimony was given in May 2008. The parties stipulated at trial that the total amount of the
payments made by Thomas Ladner to the defendants as of May 2008 was $120,185.00.
8
App.–Amarillo 1993, writ dism‟d by agr.). An unchallenged jury finding is binding on an
appellate court. See Reliance Ins. Co. v. Denton Cent. Appraisal Dist., 999 S.W.2d 626, 629
(Tex. App.–Fort Worth 1999, no pet.).
Here, we have overruled Appellants‟ challenges to Question 1. As such, we are bound by
the jury‟s finding that Ward agreed to sell the subject property to Ladner. Consequently, because
the jury found that there was an agreement to sell the property, we will not analyze Ladner‟s
payments to Ward in a manner inconsistent with the jury‟s finding in Question 1.
Possession
Question 3 asks, “Did Thomas Ladner take possession of the property in question in 1987
and retain such possession to the present time?” From our review of the record, we note that
there is evidence that Ladner was in possession of the property during the relevant time period.
However, similar to the evidence underlying payment of consideration, Appellants again argue
that Ladner‟s possession of the property is no more indicative of his status as a vendee than it is
of his status as a person who is renting property. As with our analysis of the issue of payment of
consideration, we decline to analyze Ladner‟s possession of the subject property in a manner
inconsistent with the jury‟s finding in Question 1. Therefore, we hold that there is legally
sufficient evidence to support the jury‟s answer to Question 3.
Making of Improvements with Consent
Question 4 asks, “Did Thomas Ladner make permanent and valuable improvements upon
the property in question beginning in 1987?” Based on our review of the record, we conclude
that there is legally sufficient evidence to support that Ladner made permanent and valuable
improvements on the property. Specifically, the evidence supports that Ladner made
improvements such as replacing the roof on the building located on the property and converting
the interior of the structure, which was previously a store, to a residence. We note that no
inquiry was made of the jury concerning Ward‟s consent to these improvements. However,
Ladner‟s testimony supports that such improvements were made with Ward‟s consent.6
6
Question 4 is an incomplete submission to which no objection was made. See TEX. R. CIV. P. 279.
Because the record contains some evidence that Ward consented to Ladner‟s making improvements to the property,
which is consistent with the trial court‟s judgment, we deem the missing element of consent found. Id.; see Chon
Tri v. J.T.T., 162 S.W.3d 552, 557 (Tex. 2005); State Farm Life Ins. Co. v. Beaston, 907 S.W.2d 430, 437 (Tex.
1995).
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We hold that the evidence is legally sufficient to sustain specific performance under the
equitable exception to the statute of frauds.
Factual Sufficiency
We test the factual sufficiency of the evidence by examining the entire record to
determine whether a finding is clearly wrong and unjust. See Kinder Morgan N. Tex. Pipeline,
L.P. v. Justiss, 202 S.W.3d 427, 437 (Tex. App.–Texarkana 2006, no pet.). When considering a
factual sufficiency challenge to a jury‟s verdict, we must consider and weigh all the evidence,
not just that evidence which supports the verdict. See Mar. Overseas Corp. v. Ellis, 971 S.W.2d
402, 407 (Tex. 1998). We can set aside the verdict only if it is so contrary to the overwhelming
weight of the evidence that the verdict is clearly wrong and unjust. Id.; Cain v. Bain, 709
S.W.2d 175, 176 (Tex. 1986). We are not a fact finder. See Justiss, 202 S.W.3d at 437.
Accordingly, we may not pass on the witnesses‟ credibility or substitute our judgment for that of
the jury, even if the evidence would clearly support a different result. See Golden Eagle
Archery, Inc. v. Jackson, 116 S.W.3d 757, 761 (Tex. 2003); Ellis, 971 S.W.2d at 407. If we
find the evidence is factually insufficient, we must clearly state why the jury's finding is
insufficient or is so against the great weight and preponderance of the evidence as to be
manifestly unjust. Pool v. Ford Motor Co., 715 S.W.2d 629, 635 (Tex. 1986).
In the instant case, Appellants have not argued, outside of their statement of their fourth
issue, that any particular finding is factually insufficient. Rather, they generally contend that the
evidence is factually insufficient to sustain specific performance under the equitable exception to
the statute of frauds. We have examined the entirety of the record; we have considered and
weighed all of the evidence. Having done so, we have not determined that any evidence tending
to contradict the evidence supporting the jury‟s findings is of such character so as to cause us to
conclude that the jury‟s findings are clearly wrong and unjust. Therefore, we hold that the
evidence is factually sufficient to sustain specific performance under the equitable exception to
the statute of frauds.
Summation
As set forth above, we have concluded that there is legally and factually sufficient to
sustain specific performance under the equitable exception to the statute of frauds. Accordingly,
we hold that the exception set forth in Hooks v. Bridgewater is applicable and, as a result, the
10
parties‟ contract was relieved from the operation of the statute of frauds. Appellants‟ fourth
issue is overruled.
DISPOSITION
Having overruled Appellants‟ first, second, third, and fourth issues, we affirm the trial
court‟s judgment.
SAM GRIFFITH
Justice
Opinion delivered June 30, 2010.
Panel consisted of Worthen, C.J., Griffith, J., and Hoyle, J.
(PUBLISH)
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