REAL ESTATE LAW

SPRING 2008

Chambers v. Pruitt, 241 S.W.3d 679 (Tex. App.—Dallas 2007)

Statute of Frauds: This dispute involved two pro se parties arguing about an alleged oral agreement for the sale of real property. The Pruitts sold Ms. Chambers a mobile home and then entered into negotiations with Ms. Chambers to purchase the land where the mobile home was located. Ms. Chambers paid a down payment and did not remove the trailer from the Pruitts’ land while the parties attempted to draft a contract for deed for the land. The parties did not reach an agreement as to the terms of the written contract and Ms. Chambers would not remove the trailer from the land.

Ms. Chambers sued for a breach of contract action in the county court at law and the Pruitts filed an eviction action against Chambers in the Justice of the Peace court. The Pruitts were awarded a writ of possession and a judgment for back rent. Chambers appealed and the judgment was affirmed. Chambers then filed a “Motion for Emergency Injunction/Temporary Restraining Order” and in the motion Chambers claimed “the judge made an error of law in stating that all real estate transactions must be in writing. An oral contract is enforceable & apparently the judge did not know this.” (Emphasis added). Chambers was ultimately removed from the property and the land was sold to another purchaser. The breach of contract claim resulted in a take nothing judgment in favor of the Pruitts. Ms. Chambers appealed to the Dallas Court of Appeals on twelve issues. Held: Affirmed.

First, the court held that the only available exception to the statute of frauds in a real estate transaction was the well-established three-prong test of the partial performance doctrine found in Hooks v. Bridgewater, 111 Tex. 122, 229 S.W. 1114, 1116 (1921). Ms. Chambers had to prove the elements of (1) payment of consideration by Chambers; (2) surrender of possession to Chambers; and (3) the making of valuable and permanent improvements on the land with the owner’s consent, or without such improvements, other facts that would make the transaction a fraud on the purchaser if the oral contract was not enforced. The court held that although Chambers had made a down payment on the land there was no evidence that she paid the full purchase price and in fact the amount of the purchase price was one of the issues that kept changing. Additionally, the Pruitts had not surrendered possession to Ms. Chambers and ultimately had her removed from the land because she was not entitled to possession. Ms. Chambers could not make out the essential elements of the partial performance doctrine and therefore the alleged oral agreement was not enforceable. Second, Ms. Chambers also claimed that the trial court improperly denied her claim of specific performance. The court went on to state that before a court will order specific performance of a contract for the sale of land, there must be a written agreement expressing the essential terms of the contract with reasonable certainty. There was no written contract to enforce here so the trial court did not err in its refusal to award the requested remedy.

PR Investments and Specialty Retailers, Inc. v. The State of Texas, W.L. 400396; LEXIS 121 (Tex. 2008)

Condemnation: The Texas Supreme Court addressed a jurisdictional issue involving a condemnation action. The Texas Department of Transportation (TX DOT) began a condemnation action by filing a petition and developing an initial plan for a frontage road that would impact the land owned by PR Investments (PRI) and leased by Specialty Retailers (Specialty). Before appearing before the three commissioner panel, TX DOT changed its plan in response to concerns voiced by PRI and Specialty, specifically the inclusion of an acceleration and deceleration lane. At the hearing, damages were set by the commissioners at $166,000 based on the Sparks plan. Both TX DOT and PRI appealed the decision to the trial court. A few days before trial, TX DOT abandoned the Sparks plan, which was the plan used in awarding the $166,000 in damages by the commissioners, and went back to the Corder Plan (did not include the acceleration/deceleration lanes). PRI and Specialty objected to the trial court hearing the matter, arguing that TX DOT could either dismiss the case and start over with a second administrative hearing on the Corder Plan or try the case based on the Sparks plan. The trial court dismissed the case without prejudice and awarded PRI and Specialty $650,651.47 which were all of the expert witness and attorneys’ fees and expenses. The court also ordered that TX DOT surrender possession of the .3407-acre tract of land that it intended to take for highway purposes. The court stated in its conclusions of law that it “lacked jurisdiction to proceed” under the Corder plan because it would be depriving PRI and Specialty of more than Sparks Plan did. The court also indicated that it awarded the fees and expenses as discovery sanctions, as a sanction for filing a frivolous claim, and because TX DOT failed to bring the proceeding properly as required by the Texas Property Code. The court of appeals initially affirmed the trial court’s decision but then sitting en-banc reversed and remanded for further proceedings. The en banc panel found the trial court did have jurisdiction to proceed.

Held: Affirmed. The Court held that while the trial court’s jurisdiction was “appellate” because it was not original or concurrent jurisdiction, it was not “appellate” in the sense that the evidence was already fixed in the record and the court was confined to the paper record. To the contrary, the parties could request a trial de novo if there was an objection to the findings of the commissioners and the commissioner’s award was not even admissible in the de novo trial court proceeding. So, even though the proposed plan in the trial court was different from the one the commissioners considered, that did not impact the court’s jurisdiction. A change in the specifics of the plan did not remove the trial court’s jurisdiction and the parties did not have to start over with a new administrative proceeding. Additionally, TX DOT was not even required to specifically mention its plans for the property when filing its petition. All that was required by the Property Code was that the petition (1) described the property; (2) stated the purpose for taking the property [i.e., highway frontage road]; (3) stated the name of the owner, if known; and (4) stated the entity and property owner were unable to agree to damages. The Texas Supreme Court went on to state that the ruling on discovery sanctions was being reversed and remanded to the trial court in order to consider the appropriate award for any discovery problems. The reason why the lower court awarded the sanctions it did was based on the belief that they lacked jurisdiction to hear the case. The sanctions would need to be reconsidered in light of the court’s ruling on the appropriateness of the jurisdiction.

AIC Management v. Crews, et al., W.L. 204501;LEXIS 64 (Tex. 2008)

Quitclaim Deeds: The question presented to the Texas Supreme Court in this case was whether property descriptions in a series of quitclaim deeds transferred through constable’s sales were insufficient as a matter of law to identify the lands to be conveyed. The dispute over the ownership of the property arose in the context of a condemnation action when the City of Houston decided to take the land involved to expand George Bush Intercontinental Airport. Both the Crewses and AIC claimed ownership of an 8.51 acre tract of land involved in the condemnation. The problem began with a 24.36 acre tract of land that was partitioned in 1984 into Tract #1 (the 8.51 acres at issue here) and Tract #2 (the additional 15.85 acres). After the partition occurred, the Crewses fell behind on ad valorem taxes and in 1989 the City of Houston filed a tax suit petition and ultimately took title to the property at a 1991 tax foreclosure sale. In the tax suit petition filed in 1989, the property was described as “Tract 12 being 6.0 acres out of TS Roberts Survey Abstract 659 situated in Harris County as shown in File #J659372 of deed and plat records of Harris County, Texas.” Although the entire amount of land owned by the Crewses was 8.51 acres, this description in the tax petition indicated otherwise. However, in the constable’s deed from the foreclosure sale the property description given was “all of the estate, right, title and interest which Emma Crews, Valda Crews, and Eva Fay Gross had on February 5, 1991 as described in order of sale, viz: TR 12 AB 659 TX Roberts Survey situated in Harris County, Texas.” The city took title to the property at the foreclosure sale and then later sold it at a public sale in 1997 to AIC Management. In the deed to AIC Management the property description was “all of the state [sic], right, title and interest” in “TR 12 AB 659 TS Roberts survey situated in Harris County, Texas” that the city acquired by constable’s deed in 1991. Three years later the condemnation began and AIC and the Crewses both claimed ownership of the 8.51 acres.

At the trial court the Crewses filed a motion for summary judgment claiming the property description was inadequate as a matter of law and therefore did not convey title to the property and they remained as owners. The trial court granted the motion for summary judgment in favor of the Crewses and the First Court of Appeals affirmed the judgment. AIC appealed to the Texas Supreme Court. Held: Reversed and Remanded. The Court held that there was a sufficient property description if the writing furnished within itself, or by reference to some other existing writing, the means or data by which the particular land to be conveyed may be identified with reasonable certainty. A tax judgment property description must also be sufficiently particular to allow a party to locate the specific land being identified. The Court held that the First Court of Appeals incorrectly applied a heightened standard to constable or sheriff’s deeds at forced sales. The Court noted that for more than a century Texas law had made no distinction between voluntary and involuntary conveyances. Hermann v. Likens, 90 Tex. 448, 39 S.W. 282, 284 (Tex. 1897). There was not an insufficient property description as a matter of law because in looking at the tax judgment and deeds in combination with the HCAD records, the property could be specifically identified and the parole evidence of the HCAD records was acceptable because that would be a writing in existence at the time. The case was remanded, however, because a factual determination needed to be made with respect to what exactly did the HCAD tax records reveal. It was possible that the tax foreclosure only applied to 6 acres or even less of the 8.51 acre tract and the Crewses may still own some part of the property involved. However, they might have possibly lost all interest in it as well.