Westwood Motorcars, LLC v. Virtuolotry, LLC and Richard Boyd ( 2024 )

Supreme Court of Texas
══════════
No. 22-0846
══════════
Westwood Motorcars, LLC,
Petitioner,
v.
Virtuolotry, LLC and Richard Boyd,
Respondents
═══════════════════════════════════════
On Petition for Review from the
Court of Appeals for the Fifth District of Texas
═══════════════════════════════════════
Argued February 20, 2024
JUSTICE HUDDLE delivered the opinion of the Court.
A district-court jury found for the tenant in this case, awarding
damages against the landlord and the landlord’s manager for breach of
contract and constructive eviction. But the court of appeals reversed
and rendered a take-nothing judgment because the tenant—before the
jury trial—withdrew its appeal of a justice court’s award of possession
to the landlord in a separate eviction suit and consented to the landlord’s
obtaining a writ of possession. That was error. The sole issue
adjudicated in a justice-court eviction suit is immediate possession, and
a judgment adjudicating immediate possession does not bar or have any
preclusive effect on a suit in district court for damages arising out of the
same landlord–tenant relationship. We reverse and remand to the court
of appeals for further proceedings.
I. Background
Westwood Motorcars, LLC leased commercial property in Dallas
to operate an automobile dealership. The lease provided that it would
expire in 2013, but an addendum permitted Westwood to extend the
lease for two additional terms of twenty-four months each. Westwood
and its landlord agreed to extend the lease for the first
twenty-four-month term, which would run through December 31, 2015.
In June 2015, ownership of the property changed hands and
Virtuolotry, LLC became the new landlord. Two months later,
Westwood sought to exercise its option to extend the lease for the second
additional term. But Virtuolotry’s lawyers said no, asserting that
Westwood had breached the lease in numerous ways. Westwood’s
lawyers countered by detailing Westwood’s position about why no
default had occurred and demanding that Virtuolotry acknowledge
Westwood’s right to a second extension. Westwood asserts that, in the
midst of this dispute, Virtuolotry and its manager, Richard Boyd,
harassed Westwood at the premises. For example, Westwood claims
that vendors were directed to “constantly” park trucks in front of
Westwood’s doors, which interfered with Westwood’s ability to conduct
business and prevented customers from taking test drives.
The parties sought different relief in different courts. Westwood
sued Virtuolotry in district court, seeking a declaratory judgment that
2
it had not breached the lease and that it had properly extended the lease
for another two years. Later, on December 31, 2015—the day the lease
would end if not extended a second time—Virtuolotry sued in justice
court to evict Westwood for unpaid rent, lease violations, and holding
over unlawfully. The justice court ruled for Virtuolotry and awarded it
“possession only.” Westwood appealed the judgment to the county court
at law. See TEX. CIV. PRAC. & REM. CODE § 51.001(a) (stating that
parties can generally appeal justice-court judgments to the county
court); TEX. R. CIV. P. 510.9 (describing the procedure for an appeal from
a justice-court judgment in an eviction suit).
Westwood’s trial de novo in county court was scheduled for
March 24, 2016. A few weeks before the trial date, Westwood’s lawyers
again wrote Virtuolotry. The letter insisted that Westwood was not in
default and had properly extended the lease. Yet it also notified
Virtuolotry that Westwood would vacate the premises on March 31.
Westwood formally withdrew its appeal in county court, so the de novo
trial on Virtuolotry’s eviction suit never occurred. Instead, the county
court entered a “stipulate[d] and agree[d]” judgment ordering “that
possession of the Premises is awarded” to Virtuolotry. Westwood fully
vacated the property by March 25.
But Westwood pressed its pending suit in district court, adding
claims for breach of contract (against Virtuolotry) and constructive
eviction (against Virtuolotry and Boyd). That case proceeded to a jury
trial. Westwood’s principal, Igor Hajduch, testified that Westwood
withdrew its appeal in the eviction suit “[b]ecause of constant
harassment” by Virtuolotry and the expense of the litigation. He also
3
testified that the same day Westwood moved to dismiss the eviction-suit
appeal, Boyd came into Westwood’s showroom and demanded money,
then later locked Westwood out of the premises without notice,
destroyed its security system, and prevented it from making three
customer deliveries. To access and remove its own inventory from the
premises, Westwood was forced to obtain a writ of reentry, which
allowed Westwood to move its cars off the premises to its principal’s
home.
The jury found that Virtuolotry breached the lease agreement,
causing damages consisting of lost profits, lost benefit of the bargain,
and a lost security deposit. It also found that Boyd constructively
evicted1 Westwood, causing damages in the form of relocation expenses,
and it awarded exemplary damages against Boyd. Ultimately, the
district court rendered judgment against Virtuolotry for $783,731 in
damages (plus interest) and over $350,000 in attorney’s fees, and
1 The trial court submitted a claim for constructive eviction using
elements taken from court of appeals opinions. See, e.g., Briargrove Shopping
Ctr. Joint Venture v. Vilar, Inc., 647 S.W.2d 329, 334 (Tex. App.—Houston [1st
Dist.] 1982, no writ) (setting forth the elements of a claim for constructive
eviction). Neither party objected that submission of this claim was improper,
although Virtuolotry and Boyd objected that the accompanying instruction was
incomplete, that the evidence conclusively negated the claim’s essential
elements, and that Boyd should not have been included in the question. Our
Court has not expressly recognized constructive eviction as an affirmative
claim for relief, nor have we addressed this claim’s relationship, if any, with
claims for wrongful eviction or breach of the covenant of quiet enjoyment. Cf.
49 AM. JUR. 2D Landlord and Tenant § 502 (2018) (“While some states may
recognize a tort claim for wrongful eviction, other states do not recognize
constructive eviction and breach of quiet enjoyment as separate claims . . . .”
(footnote omitted)). Because it is not necessary to do so, we express no opinion
on these issues today.
4
against Boyd for $23,331.37 in actual damages and $200,000 of (capped)
exemplary damages.
Virtuolotry and Boyd appealed, raising ten issues. The court of
appeals reversed and rendered a take-nothing judgment, relying solely
on the theory that, by agreeing to the eviction-suit judgment in county
court, Westwood “voluntarily abandoned the premises” and thus
“extinguish[ed] any claim for damages.” 684 S.W.3d 466, 469 (Tex.
App.—Dallas 2022). The court of appeals reasoned that Westwood could
not establish that it suffered any damages resulting from Virtuolotry’s
or Boyd’s actions because Westwood “agreed to the issuance of [a] writ
of possession to Virtuolotry and did not identify any act of Virtuolotry or
Boyd as being the cause for its decision.” Id. Moreover, according to the
court of appeals, Westwood’s “agree[ment] to the judgment in the county
court case” amounted to “affirmatively representing Virtuolotry had the
lawful right to possession.” Id. And so, the court concluded, “[b]y
admitting Virtuolotry had the right to possession,” Westwood
“effectively abandoned its constructive eviction claim” and was
“precluded from recovering damages” for a breach-of-contract claim
“premised on the issue of possession.” Id.Westwood moved for rehearing and for en banc reconsideration,
both of which were denied. It then petitioned this Court for review,
which we granted.
II. Relevant law
Chapter 24 of the Texas Property Code grants justice courts
“jurisdiction in eviction suits,” including suits for forcible entry and
5
detainer (FED) and forcible detainer.2 TEX. PROP. CODE § 24.004(a).
Eviction suits are designed to provide “a summary, speedy, and
inexpensive remedy for the determination of who is entitled to
possession of the premises.” McGlothlin v. Kliebert, 672 S.W.2d 231, 232
(Tex. 1984). They generally culminate in a court’s entry of a “writ of
possession,” see TEX. PROP. CODE § 24.0061(a), on a timeline much faster
than ordinary civil suits proceed to judgment. But as a consequence,
eviction suits are limited in scope and effect, with the “sole focus” being
“the right to immediate possession of real property.” Shields Ltd. P’ship
v. Bradberry, 526 S.W.3d 471, 478 (Tex. 2017); see Marshall v. Hous.
Auth. of San Antonio, 198 S.W.3d 782, 785 (Tex. 2006) (“The only issue
in a forcible detainer action is the right to actual possession of the
premises.”).
As this Court has explained, an eviction suit in justice court is
“not exclusive, but cumulative, of any other remedy that a party may
have,” and matters beyond “the justice court’s limited subject matter
jurisdiction” may be brought in another “court of competent
jurisdiction.” McGlothlin, 672 S.W.2d at 233. By rule and statute, the
2 Though the terms “forcible detainer” and “forcible entry and detainer”
are sometimes used interchangeably, they are distinct legal actions governed
by separate statutory provisions. See TEX. PROP. CODE §§ 24.001 (forcible
entry and detainer), 24.002 (forcible detainer). Generally, forcible entry and
detainer occurs when a person enters the property of another “without legal
authority or by force and refuses to surrender possession on demand.” Id.
§ 24.001(a). Forcible detainer occurs when a person whose initial entry was
lawful “refuses to surrender possession . . . on demand.” Id. § 24.002(a); see
also 41 TEX. JUR. 3D Forcible Entry and Detainer § 1 (2024) (describing the
differences between forcible detainer and forcible entry and detainer). Both
are types of eviction suits filed in justice court, see TEX. PROP. CODE § 24.004(a),
and our analysis today applies equally to both.
6
eviction suit and its judgment have a limited effect on those related
actions. Section 24.008 of the Property Code states that “[a]n eviction
suit does not bar a suit for trespass, damages, waste, rent, or mesne
profits.” And Rule 510, which governs eviction cases, identifies “the
right to actual possession” as the “[o]nly [i]ssue” in an eviction case and
specifies that claims “not asserted because of this rule can be brought in
a separate suit in a court of proper jurisdiction.” TEX. R. CIV. P. 510.3(e).
Although the justice court’s judgment may be appealed to county court,
“the county court has no greater jurisdiction than the justice court had.”
Tellez v. Rodriguez, 612 S.W.3d 707, 709 (Tex. App.—Houston [14th
Dist.] 2020, no pet.).3 That the justice court’s judgment carries no
preclusive effect in district court is underscored by the plain text of
Section 31.004(a) of the Civil Practice and Remedies Code: “A judgment
or a determination of fact or law in a proceeding in a lower trial court is
not res judicata and is not a basis for estoppel by judgment in a
proceeding in a district court . . . .”
Under this scheme, an eviction suit in justice court “may run
concurrently with another action in another court” without issue—even
if the two proceedings “overlap” and “the other action adjudicates
matters that could result in a different determination of possession.”
Kassim v. Carlisle Ints., Inc., 308 S.W.3d 537, 541 (Tex. App.—Dallas
2010, no pet.). That is because the justice court’s judgment “is a
determination only of the right to immediate possession and does not
3 Westwood also would have had no right to an appeal beyond the county
court: “A final judgment of a county court in an eviction suit may not be
appealed on the issue of possession unless the premises in question are being
used for residential purposes only.” TEX. PROP. CODE § 24.007.
7
determine the ultimate rights of the parties to any other issue in
controversy relating to the realty in question.” Id. (quoting Lopez v.
Sulak, 76 S.W.3d 597, 605 (Tex. App.—Corpus Christi–Edinburg 2002,
no pet.); accord Fed. Home Loan Mortg. Corp. v. Pham, 449 S.W.3d 230,
235 (Tex. App.—Houston [14th Dist.] 2014, no pet.).
Our decision in Coinmach Corp. v. Aspenwood Apartment Corp.,
417 S.W.3d 909 (Tex. 2013), illustrates this system of overlapping
jurisdiction. There we explained that a justice court’s judgment in an
FED suit is “a final determination only ‘of the right to immediate
possession;’ it is not ‘a final determination of whether the eviction is
wrongful’ or whether the tenant’s continued possession was a trespass.”
Id. at 919 (quoting Marshall, 198 S.W.3d at 787). Consequently, “[t]he
FED action and judgment do not bar a separate action for trespass or
for wrongful eviction, and if it is determined in that action that the
tenant lacked any legal interest or right of possession, the tenant at
sufferance is a trespasser.” Id. at 920. Similarly, we noted that an FED
judgment is “not res judicata against a related claim for trespass to try
title, and a party who loses possession in the FED action may still sue
in district court to obtain adjudication of its title and its right to regain
possession of the property.” Id. at 919 (footnote omitted).
III. Analysis
Westwood contends that the court of appeals erred by giving a
judgment of possession from a court of limited jurisdiction preclusive
effect over Westwood’s claim for damages in district court. Virtuolotry
and Boyd do not contest that the county court’s judgment may not be
given preclusive effect over the district-court action. They instead
8
defend the court of appeals’ judgment by asserting that Westwood’s
voluntary agreement to cede possession and vacate the premises
conclusively defeats its damages claims as an evidentiary matter. As we
explain below, we agree with Westwood that the court of appeals
reversibly erred.
A. Agreeing to an award of immediate possession in an
eviction suit does not concede an ultimate right to
possession or abandon separate claims regarding
possession.
The court of appeals erred by enlarging the legal significance of
the agreed judgment in county court. “An agreed judgment should be
construed in the same manner as a contract,” Gulf Ins. Co. v. Burns
Motors, Inc., 22 S.W.3d 417, 422 (Tex. 2000), and “our fundamental
objective is to ascertain the parties’ intent according to their chosen
words,” Bay, Ltd. v. Mulvey, 686 S.W.3d 401, 407 (Tex. 2024). Here, the
agreed judgment states, in pertinent part:
[Westwood] no longer wishes to appeal the decision of the
Justice Court awarding possession of the property . . . .
Thus, the Parties stipulate and agree, and it is, therefore
ORDERED that possession of the Premises is awarded to
[Virtuolotry]. It is further ORDERED that the Clerk of the
Court issue a writ of possession to [Virtuolotry].
Nothing in this text demonstrates an intent by Westwood to abandon its
claims for damages—indeed, there is no mention of other claims at all.
Nor does Westwood concede that Virtuolotry was legally entitled to
possession under the terms of the lease. The only express
representation from Westwood is that it no longer wishes to challenge
the justice court’s award of possession to Virtuolotry.
9
To be sure, Westwood stipulated to a judgment awarding
possession of the premises to Virtuolotry. But we cannot divorce this
agreed judgment from its context: an appeal of a justice-court judgment
in an eviction suit. Again, we have consistently described a judgment in
an eviction suit as a final determination only of the right to immediate
possession. E.g., Coinmach, 417 S.W.3d at 919. Such a judgment is not,
by contrast, a final determination of the parties’ ultimate rights, the
wrongfulness of the eviction, or any other question. And such a
judgment does not have preclusive effect on a subsequent action in
district court or bar a suit for damages. Against that backdrop,
Westwood’s agreement to entry of the county-court judgment cannot
reflect assent to anything more than what that judgment resolves—i.e.,
who receives immediate possession of the property.
The court of appeals was therefore wrong to equate Westwood’s
agreeing “to the judgment in the county court case” with Westwood’s
“affirmatively representing Virtuolotry had the lawful right to
possession.” 684 S.W.3d at 469. Withdrawing an appeal from a justice
court’s award of immediate possession is not the same as conceding that
an opponent has a legal right to ultimate possession, nor does it equate
to abandonment of any other claim. Matters not within the limited
subject matter of the eviction suit are addressed in another action in
another court, even if those matters relate to possession. Here,
Westwood continued to press its pending suit in district court, where it
expressly asserted a lawful right to possession under the lease. The
district-court action could—indeed, it did—result in a different
determination about who was entitled to possession under the lease.
10
The court of appeals erred in discarding the district court’s
determination favoring Westwood on the ground that Westwood opted
not to pursue its county-court appeal on the sole issue of immediate
possession.4
B. Some evidence supports the conclusion that
Westwood’s departure was not voluntary.
In response, Virtuolotry and Boyd contend that the court of
appeals’ analysis did not turn on the judgment’s legal effect but the
sufficiency of the evidence. For them, the “legally dispositive issue” in
this case (and in the court of appeals’ opinion) is “whether the tenant
voluntarily abandoned the property.” They contend that the court of
appeals simply held that Westwood voluntarily abandoned the
premises, which, in turn, conclusively showed that Virtuolotry and Boyd
were not the cause of any damages. They urge us to affirm on similar
legal-sufficiency grounds, but we decline to do so.
By their own framing, the linchpin of this argument is the
voluntary nature of Westwood’s departure. But when reviewing a
legal-sufficiency challenge to a jury verdict, we view all evidence in the
light most favorable to the verdict, and we overturn such a judgment
only if there is a complete absence of evidence proving a vital fact, the
rules of law or evidence bar the court from weighing the only evidence
proving a vital fact, the evidence offered to prove a vital fact is no more
4 In its reply brief, Westwood argues that, even if the agreed judgment
in county court included express stipulations surrendering its right to ultimate
possession or abandoning its district-court claims, the judgment still would not
control the district-court action because parties may not enlarge a court’s
jurisdiction, even by agreement. But we need not address this argument as no
such stipulations are present.
11
than a mere scintilla, or the evidence conclusively disproves the
existence of a vital fact. City of Keller v. Wilson, 168 S.W.3d 802, 807,
810 (Tex. 2005).
As Virtuolotry and Boyd tell it, the record reflects only a
voluntary choice to leave the premises as part of Westwood’s broader
strategic decision to move locations. In support, they cite the court of
appeals’ statement that Westwood could not establish causation because
it “did not identify any act of Virtuolotry or Boyd as being the cause for
its decision to abandon its appeal and agreement to vacate the Premises
and award Virtuolotry possession of same.” 684 S.W.3d at 469. And
though they concede the agreed judgment lacks any preclusive effect,
they submit that it has evidentiary significance: the agreement to
surrender possession shows that Westwood left voluntarily and that any
damages were not of Virtuolotry’s or Boyd’s making.
Although Westwood’s decision to abandon its appeal and agree to
entry of a judgment in the eviction suit may constitute some evidence
that Westwood’s departure was voluntary, it was not conclusive
evidence. A key dispute at trial was whether Westwood departed the
property and withdrew its appeal because of its own voluntary choice or
Virtuolotry’s and Boyd’s bad conduct. Westwood argued to the jury that
it left because of Virtuolotry’s “harassment,” while Virtuolotry and Boyd
argued that there was “simply no causal relationship” and that
Westwood departed for business reasons. The jury resolved this conflict
in the evidence in Westwood’s favor, and the record contains
considerable evidence supporting its finding.
12
For example, the jury heard testimony that, when Virtuolotry
became the landlord, vendors began to “constantly” obstruct Westwood’s
doors, which blocked customers from taking test drives and hampered
Westwood’s ability to conduct business. In its letter to Virtuolotry
agreeing to vacate the premises, Westwood continued to assert that it
had properly extended the lease, and the jury heard evidence that
Westwood’s later decision to withdraw its appeal of the eviction suit was
not voluntary. Westwood’s principal was asked at trial, “[W]hy did
Westwood withdraw its notice of appeal?” He answered: Westwood did
not want to stay there any longer “[b]ecause of constant harassment.”
Westwood further presented evidence that after informing Virtuolotry
it would leave on (and had paid rent through) March 31, it was forced to
leave earlier (and before it had obtained a new location to relocate its
considerable inventory) due to Boyd’s continuing harassment—
specifically, his demanding money in the showroom, locking Westwood
out of the property without notice, destroying Westwood’s security
system, and threatening, through his attorney, to have Westwood’s
principal arrested.
Focusing on Westwood’s choice to agree to the county-court
judgment, Virtuolotry and Boyd rely on our past instruction that a “legal
eviction cannot be predicated upon the mere voluntary act” of the
tenant. Gibson v. Turner, 294 S.W.2d 781, 789 (Tex. 1956) (quoting
Rancho Bonito Land & Live-Stock Co. v. North, 45 S.W. 994, 996 (Tex.
1898)). Yet these older cases speak only to those acts that are truly
“voluntary,” which, by definition, are not those induced by coercion or
harassment by others. Voluntary, BLACK’S LAW DICTIONARY (11th ed.
13
2019) (“Unconstrained by interference; not impelled by outside
influence”).
Likewise, Virtuolotry and Boyd cite multiple courts of appeals for
the proposition that “a mere notice to quit, followed by vacation of the
premises by the tenant, does not constitute a constructive eviction.”
E.g., Quitta v. Fossati, 808 S.W.2d 636, 643 (Tex. App.—Corpus Christi–
Edinburg 1991, writ denied). But those constructive-eviction cases
expressly recognize that evidence of “some additional feature, such as
harassing incidents disturbing to the tenant’s peaceful possession,” can
take a tenant’s claim outside the realm of cases involving “a mere notice
to quit.” Id.Such evidence exists here. Westwood presented extensive
evidence of Virtuolotry’s and Boyd’s interference with Westwood’s use of
the premises, and its principal testified that Westwood left because of
“constant harassment.” This constitutes “some evidence, and therefore
legally sufficient evidence,” from which the jury rationally could have
found that neither Westwood’s departure nor its agreement to entry of
the county-court judgment were voluntary. See Crosstex N. Tex.
Pipeline, L.P. v. Gardiner, 505 S.W.3d 580, 615 (Tex. 2016). Virtuolotry
and Boyd’s argument for affirmance therefore fails.5
5 Virtuolotry and Boyd raised multiple other issues on appeal that the
court of appeals did not reach. They suggest that, instead of remanding, we
address their other rendition points based on the briefing in the court of
appeals. We decline to do so in the first instance and express no opinion as to
any other issue raised below. See In re Troy S. Poe Tr., 646 S.W.3d 771, 780–81
(Tex. 2022).
14
IV. Conclusion
We reverse the court of appeals’ judgment and remand to that
court for consideration of the unaddressed issues presented on appeal.
Rebeca A. Huddle
Justice
OPINION DELIVERED: May 17, 2024
15