REAL ESTATE LAW
Sandoval v. Cmty. Missionary Baptist Church, 2018 W.L. 1773208; LEXIS 2637 (Tex. App.—Dallas 2018, no pet.)
Express Easement or Easement by Estoppel: The Judah family owned four contiguous lots (A, B, C, and D) in DeSoto, TX.
The westernmost lot (Lot D) had access to Church Street and West Belt Line Road. The easternmost lot (Lot C) was accessible by North Hampton Road. In 1985, the Judah family sold lot D to the DeSoto Church of Christ, who in 2006 sold lot D in to Community Missionary Baptist Church (“The Church). In 2006, the Judah family still retained ownership of the other three lots (A, B, C, and D). The Church entered into an agreement granting an access easement over the church’s property to lot A, which had no access road. The agreement was granted only for as long as the Judahs owned the property. In 2007, the Church asked the City to abandon a portion of Church Road to provide more parking space. The City approved the request with the condition that the church provide utility easements. On June 28, 2007, Pastor Oscar Epps, on behalf of CMBC, signed a new amended plat for the property that showed the abandoned roadway and specifically outlined utility easements. The Owners Certificate attached to the plat described the easements being granted to the public utilities in detail. On the front of the plat was a notation stating, “NOTE: A Blanket Ingress/Egress Easement is granted across Lot 1A, Block 4 of this plat [CMBC's property] to 168 Church Street [lot A].”
In 2011, the Judah family decided to sell the remaining plots of land. In 2013, Sandoval became interested in purchasing Lot A. The Judahs wrote a letter to the Church asking it to extend the easement allowing access to Church Road. The Church declined to extend the easement. Sandoval hesitated to purchase the property without access but eventually went through with the purchase based on title reports from multiple title companies.
The Church sued Sandoval and individuals involved with the title companies seeking declaratory judgment on multiple issues relating to their claim that there was no easement granted for Sandoval across Lot D. Both parties moved for traditional summary judgment on the issues of express easement and easement by estoppel. CMBC also moved for a no evidence summary judgment arguing that the defendant could not provide a writing conveying an express easement. The trial court granted the Church’s motions for summary judgment and denied Sandoval’s. Sandoval appealed.
In his first issue on appeal, Sandoval contends that the trial court erred in granting both a traditional and no evidence summary judgment in favor of the Church because the notation on the amended plat regarding a blanket easement was sufficient to create an express easement. Sandoval concedes that the express easement is an interest in land, therefore there must be a writing sufficient to satisfy the statute of frauds and statute of conveyances to successfully convey the interest. Although there is no specific requirement for language of the grant, since the easement is an interest in land, the grant should have the same essential characteristics as a deed to real estate.
To be legally effective, the instrument must (1) sufficiently identify the grantor and grantee, (2) contain operative words of grant by showing an intention by the grantor to convey the interest to the grantee, (3) sufficiently describe the interest being conveyed, and (4) be signed and acknowledged by the grantor. The notation on which Sandoval relies fails to meet the first factor listed above because it does not identify to whom the interest is being granted. The only easement grantees named are public utilities. Furthermore, the Judahs had been the owners of the property at the time the plat was amended. Nothing on the plat or in the Owner’s Certificate references the Judahs as the grantees, not is there evidence that the Judahs ever considered themselves to be the grantees of the easement purportedly created by the notation on the plat.
Sandoval attempts to argue that the language “to 168 Church Street” not only identifies the easement being conveyed but also can be interpreted to identify the party receiving the easement. However, Sandoval does not cite any authority supporting his argument that a piece of land can be the grantee in a real estate contract. Instead, Sandoval uses case law discussing appurtenant easements, which run with the dominant estate. This does not eliminate the requirement that the original owner of the dominant estate be a party to the creation of the express easement. The court finds that Sandoval failed to produce sufficient evidence to defeat the Church’s motion for summary judgment and resolved the first issue on appeal against Sandoval.
Sandoval’s second issue asserts that the plat notation gave rise to an easement by estoppel. An easement by estoppel requires proof that (1) a representation of the easement was communicated to the innocent party, (2) the communication was believed, and (3) the innocent party relied on the communication. Sandoval only argues that he relied on the notation on the amended plat and offers no other representations by the Church on which he relied. However, the record shows that Sandoval did not rely on the notation since multiple people advised him against relying on the notation. Sandoval even hesitated in purchasing the property until one title company was willing to say the plat notation created an easement.
Sandoval then attempted to argue that his is not required to show reliance because the Church is bound by the doctrines of estoppel by deed and estoppel by contract. For these doctrines to apply in this case, Sandoval was required to produce evidence of a deed or contract between the Church and the Judahs by which the Church conveyed to the Judahs an easement interest that it would now be estopped from denying. There is no evidence of any type of easement agreement between the Church and the Judahs other than a determinable easement, which ended when the Judahs sold the property.
The court finds that the trial court properly ruled that Sandoval produced no evidence of an express easement, estoppel by deed, or estoppel by contract. The trial court’s judgment is affirmed.
C.I.A. Hidden Forest, Inc. v. Watson, 09-17-00117-CV, 2018 W.L. 1527626; LEXIS 2262 (Tex. App.—Beaumont 2018, no pet)
Summary Judgment-Insufficient Evidence: Deborah Watson and Larry Harris, appellees, filed a declaratory judgment action against Hidden Forest. The Appellees claim that none of the deed restrictions on their six properties in a Hidden Forest Estates subdivision include a maintenance assessment or grant authority for a lien against the property. They allege that Hidden Forest improperly imposed rules, regulations, and assessment charges against the Appellees, since Hidden Forest had not properly formed or been adopted as a property owners association.
The Appellees allege that in September 2011, they received an initial demand for $277 to Hidden Forest. They responded to this demand by stating that no valid restrictions imposed maintenance assessment or lien on their property and that Hidden Forest was not properly formed in accordance with the Texas Property Code, therefore lacking authority over the property owners. In February 2012, the Appellees allege that Hidden Forest demanded an additional $158, citing a 1997 judgment against another property owner allowing Hidden Forest to collect maintenance fees.
Held: The court held that the trial court had erred in granting summary judgment in favor of the property owners in their declaratory action against Hidden Forest because neither party produced summary judgment evidence regarding whether Hidden Forest was a non-profit corporation in good standing in Texas pursuant to Tex. Prop. Code. 204.004(b) or whether the deeds signed by the owners had restrictions. In addition, neither side demonstrated that there were no genuine issues of material fact and that they were entitled to judgment as a matter of law. The case was reversed and remanded.
Casterline v. One W. Bank, FSB, 2018 W.L. 1755821; LEXIS 2582 (Tex. App.—Corpus Christi 2018, no pet.)
Foreclosure: In June 2007, Casterline executed a home equity note and delivered it to IndyMac Bank, FSB. The note was secured by a deed of trust note to property located at 103 Bay Court. The interest in the deed of trust was assigned to OneWest. In December 2009, OneWest sent Casterline a written notice of default, explaining that to cure the default, she must pay $13,096.92 and that failure to cure the default would result in an acceleration of the note and foreclosure on the property. Two months later, Casterline was notified that since the default had not been cured, OneWest would accelerate the loan and declare the entire balance due.
In February 2014, OneWest filed suit seeking foreclosure on its lien on the Bay Court property. Casterline responded by moving for summary judgment, claiming res judicata barred the proceedings. OneWest denied that res judicata applied and filed their own summary judgment motion, asserting three reasons it was entitled to foreclosure on the property: (1) it was the assignee of the home equity note and deed of trust, (2) Casterline was in default, (3) Casterline was properly notified of the default and acceleration. Casterline responded by arguing that OneWest had asserted relief for judicial foreclosure in a previous proceeding. Casterline later supplemented her motion and response with the argument that OneWest’s claims were barred based on the applicable limitations period. The trial court denied Casterline’s motion and granted OneWest’s motion, stating that OneWest could proceed with foreclosure of the property.
Casterline first asserted that OneWest’s claims are barred by the statute of limitations. A lender must bring suit for the foreclosure of a real property lien not later than four years after the day the cause of action accrues. When a note payable in installments is secured by a real property lien, the four-year limitation does not begin to run until the maturity date of the last note, obligation, or installment. When a note or deed of trust contains an optional acceleration clause, default does not start limitations running on the note, but only beings to accrue when the holder exercises its option to accelerate. The court agreed with OneWest’s contention that it accelerated the note on February 8, 2010, rather than the earlier date, January 15, 2010, asserted by Casterline. The January 15 letter was the intent to accelerate, while the February 8 letter was the notice of acceleration. Therefore, the trial court did not err in denying summary judgment on limitation grounds.
Casterline then argued that the trial court erred in denying her summary judgment based on the barring of OneWest’s claim by res judicata, citing a dismissed federal court proceeding from December 2012. The court denies this argument on the basis that res judicata does not bar a former defendant who asserted no affirmative claim for relief in an earlier action from starting a claim in a later action. The appeals court concluded that the issue in this case was not previously adjudicated, and therefore the trial court did not err in denying Casterline’s motion for summary judgment.
Casterline’s third issue focused on the compulsory counterclaim rule, particularly that the present relief sought by OneWest should have been brought as a counterclaim in the previous litigation, and therefore is barred as a matter of law. The court cited a notable exception to the compulsory counterclaim rule, the Kaspar rule. The Kaspar rule states that the power of a sale in a deed of trust is a valuable contract right which cannot be impaired by any subsequent act of the mortgagor and that judicial foreclosure and foreclosure under the power of sale in a deed of trust are remedies which cannot be concurrently prosecuted. Furthermore, the Kaspar rule has been extended to home equity loans. The reasoning for extending the Kaspar rule is that a borrower should not be allowed to deprive its lender a choice of remedies. Held: The court of appeals found that the trial court did not err in denying Casterline’s motion for summary judgment and was correct in granting OneWest’s summary judgment. The trial court’s decision is affirmed.
Scott v. Homeowner's Ass'n of Spring Creek, Inc., 2018 W.L. 1750806; LEXIS 2577 (Tex. App.—Waco 2018, no pet.)
Restrictive Covenant: Charlotte Scott appealed a judgment that found she had violated a restrictive covenant, requiring her to remove a wrought iron gate. Scott claims the trial court erred by failing to enter findings of fact and conclusions of law, that the evidence was legally insufficient for the trial court to have found she violated the restrictive covenant and factually insufficient to show any other violations of restrictive covenants, and that the trial court erred in finding that the HOA did not act in an arbitrary, capricious, or unreasonable manner.
In Scott’s first issue, she complained that the failure to file findings of fact and conclusions of law in a timely manner should result in a reversal since it affected her ability to present her issues properly on appeal. The appeals court agreed and abated the proceedings to the trial court for entry of the required findings and conclusions, then allowed for Scott to rebrief her issues in response. Scott amended her brief but still argued that the remedy was insufficient. The court found no issue with the remedy and therefore overruled issue one.
Scott then complains that the evidence was legally insufficient for the trial court to have ruled that she violated the restrictive covenant because the HOA did not conduct a hearing on her appeal of the denial of her property modification request, which resulted in a deemed approval of her request. In November 2014, Scott submitted a request for permission to install a wrought iron gate on her property. Her request was denied. She responded by requesting reconsideration, which was again denied. She then notified the HOA that she would be seeking litigation. Although the Board for the HOA never met with Scott, each denial letter stated the Board would be happy to meet with Scott to discuss her request. The court stated that Scott did not provide any citations, and the court found no provisions in either the restrictive covenant or the property code, to support these claims. Therefore, the court overruled issue two.
The court found issue three, relating to any other violations, moot because the court already found sufficient evidence to support the trial court’s judgment that Scott had violated the restrictive covenant.
In her fourth issue, Scott argues that the trial court erred in deciding the HOA had not acted arbitrarily, capriciously, and/or unreasonably. Scott had the burden of proof at the trial court level to show the HOA had acted in such a manner. The initial denial of her request for the gate cited multiple reasons for denying her request. The Declaration of Covenants gave the HOA sole discretion with regards to taste, design, and standards relating to any proposed or existing improvements. Scott also tried to claim bias against her, but evidence showed other requests she had made were approved. The trial court’s decision was upheld. Held: The court found no reversible error, therefore affirming the trial court’s judgment.
Parker v. Weber, 2018 W.L. 2248369; LEXIS 3454 (Tex. App.—Waco 2018, no pet.)
Adverse Possession: In 2014, the Parkers purchased a 102 acre plot of land from Dick Taylor. Taylor separately sold the 20 acres at issue in this case to the Parkers as well. A fence separated the 20 acres from the other 102 acres. Glenn Weber owned land on the north, east, and west sides of the 20 acre plot. In 2015, Weber sued the Parkers due to a disagreement between the parties regarding the Parkers putting a ladder over the fence to access the 20 acres from the 102 acres and the Parkers’ actions to remove the fence. The trial court ruled in favor of Weber’s ownership of the 20 acres based on the 10 and 25 year statutory limitations for adverse possession. The Parkers appealed, arguing that there is no evidence or insufficient evidence to support the trial court’s ruling.
On appeal, the court reviewed whether the statutory requirements for adverse possession were met. Adverse possession requires actual, visible, continuous, notorious, exclusive and hostile possession that is of such character as to indicate unmistakably an assertion of a claim of exclusive ownership in the occupant. The burden of proof in establishing adverse possession is on the party seeking to establish title in the land by the statutes of limitation.
This case turned on whether the fence around Weber’s land, which he claims included the 20 acres in question, was a designed enclosure or casual fence. The trial court ruled that it was a designed enclosure. However, the court of appeals stated that even a cursory glance at the record would show that the placement of the fence was due to the convenience due to a creek located on the official property line. The fence was built prior to Weber’s father purchasing the property. Based on these facts, the fence would be simply a casual fence rather than a designed enclosure. Weber disputes this on the basis that he rebuilt the fence in 1959, thus making it a designed enclosure. The appeals court disagreed, stating that the fence would change to a designed enclosure only if the adverse possessor changed the character of the fence. Other evidence supporting the adverse possession, such as continual grazing and built or maintained roads, were also denied by the appeals court. Held: The court sustained the Parkers’ issues and reversed the trial court’s judgment.
Knopf v. Gray, 545 S.W.3d 542 (Tex. 2018), reh'g denied (June 1, 2018)
Vada Allen disposed of her entire estate through a will, devising a 316 acre plot of land to Bobby Gray. The bequest of the land was followed with instructive language that the land was not to be sold but passed to Gray’s children. Gray and his wife conveyed the land in fee simple to Polasek Farms LLC with multiple warranty deeds. Two of Gray’s children, Annette Knopf and Stanley Gray filed suit against their parents and Polasek Farms, seeking a declaratory judgment that Allen only devised a life estate to Bobby, and thus the conveyance to Polasek Farms was merely a life estate pur autre vie. Both sides moved for summary judgment. The issue in the present case is whether the testator intended to devise a fee-simple interest or a life-estate interest to her son. The trial court and court of appeals both held that the will devised a fee-simple interest, which entitled the son to summary judgment. The Supreme Court of Texas granted review of the case.
Knopf argues that when the provision in question is read in conjunction with other language throughout the will, it shows intent to grant Gray a life estate with the remainder interest going to her grandchildren. Gray counters that the instructional language conveys a fee simple interest. In the alternative, Gray argues that the language constitutes an invalid disabling restraint, is nontestamentary, or is insufficient to create a life estate.
Held: The court states that while the parties focus their arguments on the specific phrase “passed on down,” reading so specifically causes the parties to miss the forest through the trees. According to the Supreme Court, a layperson’s clearly expressed intent to create a life estate. The court rationalizes this conclusion by stating that the provisions grant the land to Gray subject to the limitations that he not sell it, that he take care of it, and that it be passed down to his children; in essence, this creates a life estate. When read in the context of the rest of the will, the testator often requests that property be passed down or handed down to devisees’ children, thus expressing a desire for property to be kept within the family for several generations.
In response to the alternative arguments present by Gray, the Court rejects all of them. A disabling restraint is an attempt by the grantor to invalidate a grantee’s later transfer of the interest. According to the court, viewing the fragment being referenced in isolation goes against the practices of will construction, ruling instead that the phrase “the land is not to be sold” is integral to creating the life estate, and therefore is not a disabling restraint since restraint on alienation is inherent in a life estate. The other arguments raised by Gray are rejected since the Court found that the provision in question clearly speaks to the intent of the grantor. The Supreme Court reversed the court of appeals’ judgment, granting Gray a life estate and his children a remainder interest. The case was remanded to the trial court level for proceedings consistent with this opinion.
Knowlton v. Knowlton, 2018 W.L. 2222621; LEXIS 3408 (Tex. App.—San Antonio 2018, no pet.)
Gift v. Community Property: Ralph and Brenda Knowlton were previously married. In the divorce proceedings, the characterization of five acres of land came into question. During the couple’s marriage, they had lived on the property in a mobile home. Ralph claimed the property was his separate property, given as a gift to him by his mother. Brenda testified that in 2013, Ralph’s mother signed a quit claim deed she had printed off the internet because the couple was in the process of obtaining an equity loan to do repairs on the property. However, the bank would not accept the quitclaim deed as valid because it did not include a physical description of the property. In March 2014, Ralph’s mother executed a general warranty deed conveying the property to both Ralph and Brenda. In addition, a correction affidavit was filed with the intention of correcting the legal description on the warranty deed. Brenda argued the warranty deed and correction affidavit were created so that the couple could both properly be owners of the property. Ralph argued he considered the property to be his with the conveyance of the quitclaim deed.
The trial court concluded that the property was community property, and therefore the only solution was to sell the property, use the proceeds to repay the home equity loan, and then split the remaining balance between the parties. In their findings of fact and conclusions of law, the trial court stated that the property had been acquired by the couple during their marriage, that the quitclaim deed conveyed the property to Ralph, but that the bank required a warranty deed since the quitclaim deed lacked the physical description of the property. The trial court decided that it was just in the division of marital property to sell the property and use the proceeds in the manner described above.
Held: Ralph raised five issues, which the court addressed together since the issues overlapped. The court presumes that a deed executed by a parent in favor of their child is a gift, so the burden was on Brenda to show that the quitclaim was not intended to be a gift. However, the court also looks to the intent of the donor when determining whether the transfer was meant as a gift. The court decided that the language of the quitclaim deed, which on its face states that the property was transferred to Ralph “for and in consideration of the sum of Ten Dollars...and other good and valuable consideration, did not constitute a gift. Furthermore, the second deed combined with the bank’s rejection of the quitclaim deed indicated that the quitclaim deed was not valid and did not convey the property properly to Ralph. The court held that the record contained ample evidence to support the trial court’s decision. The court of appeals affirmed the trial court’s judgment.
Twin Creeks Golf Group, L.P. v. Sunset Ridge Owners Ass'n, Inc., 537 S.W.3d 535 (Tex. App.—Austin 2017, no pet.)
Declaration of Condominium-Restrictive Covenants: The Twin Creeks Country Club Community, which includes single family residences, condominiums, and a country club, was established by a master declaration in March 2002. On the same day the Community was established, the owners filed a restrictive covenant which included a requirement that all residential owners acquire and maintain a membership in the country club, operated by Twin Creeks Property Ltd. In 2004, a declaration of condominium was filed establishing Sunset Ridge Condominiums was subject to the restrictive covenant. In the same year, Twin Creeks Property transferred operation of the country club to Twin Creeks Operating Co., at which time Twin Creek Property filed an Amended and Redated Restrictive Covenant. The amendment stated that despite the transfer in operations, there would be no change in the obligations of the owners of the properties subject to the covenant. The amendment did not substantially change the original covenant but was meant to supersede the original. In 2008, appellant Twin Creeks was assigned all rights and obligations under the Amended Restrictive Covenant.
In 2015, Sunset Ridge filed suit against Twin Creeks Property and Twin Creeks Operating Co. seeking declaration that the Amended Restrictive Covenant is invalid as to the condominium owners. Sunset Ridge argued that the failure to renew the covenant after the ninth anniversary made the amendment invalid pursuant to section 82.0675(a). Appellant Twin Creeks intervened as the current holder of the rights under the amendment. The trial court granted partial summary judgment on Sunset Ridge’s declaratory judgment claim only and held that section 8.20675 applied to the Amended Restrictive Covenant, that the Restrictive Covenant was not renewed, and that any provision of the Restrictive Covenant requiring condominium owners to maintain membership was invalid. The parties were unable to agree on whether the partial summary judgment was filed, so Twin Creeks filed a notice of appeal and then filed a motion to dismiss the appeal for lack of jurisdiction based on lack of a final and appealable order. The court agreed that the order was not final and appealable and dismissed the appeal. The trial court denied the plea in abatement and signed an order dismissing the monopoly claim, thus rendering the partial summary judgment final and appealable. Twin Creeks appealed the summary judgment in favor of Sunset Ridge.
Twin Creeks argues that section 82.0675 does not apply to the Amended Restrictive Covenant because the section is only applicable to condominiums but does not apply to restrictions that are applicable to both condominiums and other types of real property. While the court agreed that the section referred to condominiums, it did not agree that the section did not apply to restrictions that applied to condominiums and other types of property. The court stated that if the legislature had wanted to make such an exception to section 82.0675, it could have done so expressly. Twin Creeks also tried to argue that the Amendment was not a “declaration” or a “recorded contract” within the meaning of section 82.0675. The court concludes that the Amended Restrictive Covenant is a “recorded contract” within the meaning of the term as used in section 82.0675; therefore, the court overruled this issue. Twin Creeks also argued that the Amendment did not cause section 82.0675 to become applicable because the Restrictive Covenant was in effect prior to the effective date of the statute in question, and since the Amendment did not change much of the language, it did not create a new restrictive covenant. Since the purpose of the Amendment was to supersede the Restrictive Covenant, the court finds that section 82.0675 applies to the Amendment. Held: The court concluded that the trial court did not err in granting partial summary judgment in favor of Sunset Ridge. It also found that the trial court did not err in denying Twin Creeks’ plea in abatement.
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