Lance Williams v. George Coulam ( 2010 )

Opinion issued June 24, 2010.

In The

Court of Appeals

For The

First District of Texas

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NO. 01-09-00279-CV

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Lance Williams, Appellant

V.

George Coulam, Appellee

On Appeal from the 506th District Court

Grimes County, Texas

Trial Court Case No. 30687

MEMORANDUM OPINION

          This appeal concerns an agreement for the sale of all the stock of the Texas Renaissance Festival, Inc. (the “Company”), which operates the Texas Renaissance Festival near Plantersville, Texas. Appellee, George Coulam, the sole shareholder of the Company, brought suit seeking a declaratory judgment that his contract with appellant, Lance Williams, for sale of the Company was invalid. Williams counterclaimed for breach of contract, seeking specific performance and, alternatively, damages. Williams also filed a notice of lis pendens concerning real property owned by the Company.  The trial court rendered summary judgment in favor of Coulam and cancelled the lis pendens.  Asserting the trial court erred by granting summary judgment for Coulam, Williams’s two issues contend that he did not breach the contract by failing to provide proof of the availability of funds and that the lis pendens should not be cancelled.  We conclude that in this appeal Williams has not challenged each element of his breach of contract claim found against him by the trial court and, therefore, we must affirm the trial court’s order rendering summary judgment in favor of Coulam and denying Williams’s cross-motion.

Background

          In a “Sale and Purchase Agreement” (the “Agreement”) entered May 19, 2006, Williams agreed to purchase the Company from Coulam on a closing date 40 days later on June 28, 2006.  The Agreement required Williams to pay Coulam $10 million at closing.  The Agreement, however, did not require Williams to show, prior to the closing date, that he had the financial ability to close.  Coulam’s burden under the Agreement was to make certain business and financial records available to Williams within 10 days of the Agreement, to provide access to Company employees, and to provide a copy of any survey in Coulam’s possession. 

          One week before the closing date, Williams notified Coulam that he had not yet received a copy of a survey.  Coulam agreed to extend the closing date until a survey was prepared.  A survey was delivered to Williams in September 2006.  Williams, however, believed the survey was incomplete.  When he called in early October 2006 to inquire about the survey, Williams learned from an employee at the surveying company that the survey did not depict all of the real property owned by the Company and that portions of the real property excluded from the survey were being sold to a different buyer. Williams then called Coulam for an explanation, and Coulam informed him that he believed the Agreement had terminated. The transaction never closed. 

Coulam and Williams each filed lawsuits against the other and each filed motions for summary judgment against the other.  Coulam filed this suit seeking a declaration that the Agreement was not a valid contract or, in the alternative, that Coulam was excused from performance of the Agreement because Williams had not tendered the consideration due to him by the date required in the Agreement.  Coulam also filed a first motion for summary judgment asserting these grounds.  Williams counter-claimed for breach of contract, seeking specific performance of the Agreement and filed his first motion for summary judgment on these grounds. After each of the parties responded to the opponent’s motion for summary judgment, the trial court rendered two interlocutory orders concerning the first motions for summary judgment.  The trial court denied in part Coulam’s motion for summary judgment, and it granted in part and denied in part Williams’s motion for summary judgment.  The trial court found that the Agreement was a valid contract, but because the parties extended the closing date “until we have a survey,” the closing was extended until a reasonable time following September 26, 2006, when a survey was delivered.

Although it did not decide the issue of breach in the first partial summary judgment order, the trial court ordered the parties to specifically perform the Agreement, and established a timeline for Williams to “provide written evidence of the availability of funds for closing the transaction . . . .”  Williams presented letters of interest rather than letters of commitment from two potential lenders.  The trial court determined that Williams was not entitled to specific performance because he failed to prove his ability to perform his obligation under the contract, i.e. the payment of the purchase price.

          Because the trial court had withheld a finding concerning the element of breach, the parties filed competing second motions for summary judgment concerning that element.  Coulam’s second motion for summary judgment concerning the element of breach contended that he substantially performed the material requirements of the Agreement by providing Williams the complete survey, allowing Williams to meet with Company employees, providing Williams the complete title policies, and providing Williams the other financial information specifically required by the Agreement.  Coulam asserted Williams breached the Agreement by failing to pay the amount due by the time required under the Agreement, which was the original closing date or within a reasonable amount of time after Coulam provided the survey. Coulam also asserted that, even if he told Williams the Agreement was terminated, he timely retracted that comment by notifying Williams that he intended to perform.

In contrast, Williams’s second motion for summary judgment asserted that Coulam had breached the Agreement by refusing to provide him the survey, refusing to allow him to meet with Company employees, refusing to provide complete title policies, and refusing to provide other financial information specifically required by the Agreement.  According to Williams, these breaches by Coulam caused him to be unable to perform a full investigation of the Company and close on the purchase of the Company. Williams also contended that Coulam terminated and repudiated the Agreement before any breach by Williams.

          Concerning the second motions for summary judgment relating to the element of breach of contract, the trial court granted in part and denied in part Coulam’s motion for summary judgment, and denied Williams’s motion for summary judgment.  The trial court ordered that Coulam take nothing against Williams and that Williams take nothing against Coulam.  The court determined there was no material breach by Coulam; Williams did commit a material breach of the contract by failing to provide proof of the availability of funds to pay the purchase price of the contract; Williams was not entitled to specific performance of the contract; Coulam was entitled to judgment as a matter of law that Williams breached the contract because there were no genuine issues of material fact; and Coulam was not entitled to attorney’s fees. The trial court also granted the motion to cancel the lis pendens, which made the trial court’s prior interlocutory summary judgments final and appealable because all claims had been resolved by all the parties.

Summary Judgment Standard of Review

          We review summary judgments de novo.  Valence Operating Co. v. Dorsett, 164 S.W.3d 656, 661 (Tex. 2005).  A matter-of-law summary judgment is proper only when the movant establishes that there is no genuine issue of material fact and that the movant is entitled to judgment as a matter of law.  Tex. R. Civ. P. 166a(c).  The motion must state the specific grounds relied upon for summary judgment.  Id.  In reviewing a matter-of-law summary judgment, we must indulge every reasonable inference in favor of the nonmovant, take all evidence favorable to the nonmovant as true, and resolve any doubts in favor of the nonmovant.  Valence, 164 S.W.3d at 661.  If, however, summary judgment may have been rendered, properly or improperly, on a ground not challenged on appeal, the judgment must be affirmed.  Ellis v. Precision Engine Rebuilders, Inc., 68 S.W.3d 894, 898 (Tex. App.—Houston [1st Dist.] 2002, no pet.); see also Jacobs v. Satterwhite, 65 S.W.3d 653, 655 (Tex. 2001) (holding appellate court may not reverse judgment on grounds not raised and argued on appeal).  Similarly, when a motion for summary judgment is granted without specifying the grounds, the summary judgment will be upheld on appeal if any of the theories advanced in the trial court are meritorious.  Harwell v. State Farm Mut. Auto. Ins. Co., 896 S.W.2d 170, 173 (Tex. 1995).

Elements of Claim for Breach of Contract

The two issues on appeal presented by Williams assert he did not breach the contract and that the lis pendens should not be cancelled.  But in his original brief on appeal, Coulam fails to challenge the trial court’s summary judgment that Coulam did not breach the contract, which is an essential element of his claim for breach of contract.  The essential elements of a breach of contract claim are: (1) the existence of a valid contract; (2) performance or tendered performance by the plaintiff; (3) breach of the contract by the defendant; and (4) damages sustained by the plaintiff as a result of the breach.  Valero Mktg. & Supply Co. v. Kalama Int’l, 51 S.W.3d 345, 351 (Tex. App.—Houston [1st Dist.] 2001, no pet.).  To prevail on his breach of contract claim, therefore, Williams must establish that (1) a valid agreement exists; (2) he performed under the Agreement; (3) Coulam breached the agreement; and (4) damages.  In resolving the competing matter-of-law summary judgment motions, the trial court’s summary judgment order determined that Coulam delivered the survey in September 2006; the closing was extended until a reasonable time after that; and Coulam did not breach the Agreement.

          In his opening brief on appeal, Williams has failed to timely challenge the trial court’s determination that Coulam did not breach the contract.  This challenge is made for the first time in Williams’s reply brief after Coulam’s appellee’s brief asserts that the arguments are waived for failure to assert them in the opening appellant’s brief by Williams.  An issue raised for the first time in a reply brief is ordinarily waived and need not be considered by this Court. McAlester Fuel Co. v. Smith Int'l., Inc., 257 S.W.3d 732, 737 (Tex. App.—Houston [1st Dist.] 2007, pet. denied) (citing N.P. v. Methodist Hosp., 190 S.W.3d 217, 225 (Tex. App.—Houston [1st Dist.] 2006, pet. denied)).  Because Williams failed to timely challenge the trial court’s determination that there was no material breach by Coulam, we hold Williams waived any error concerning the trial court’s order that determined Coulam did not breach the agreement as a matter of law.  See McAlester Fuel Co., 257 S.W.3d at 737.

Having upheld the trial court’s order that Coulam did not breach the agreement, Williams’s claim for breach of contract fails as a matter of law because Williams cannot establish each of the elements of his claim for breach of contract. See Mustang Pipeline Co. v. Driver Pipeline Co., 134 S.W.3d 195, 200 (Tex. 2004).  We, therefore, must uphold the trial court’s summary judgment order that Williams take nothing on his breach of contract claim against Coulam.  Having affirmed the trial court’s take-nothing judgment on William’s breach of contract claim, we also conclude the trial court properly cancelled the lis pendens.

Alternatively, Williams requests that we “reverse the order of the trial court granting summary judgment and remand the case for a trial on the merits.”  For the reasons previously discussed, we cannot reverse the trial court’s ruling on Williams’s breach of contract claim.  Likewise, we cannot reverse the trial court’s take-nothing summary judgment concerning Coulam’s declaratory judgment claim.  Neither party has challenged that ruling on appeal.

Williams does purport to specifically challenge the trial court’s ruling that he committed a material breach of the contract.  However, Williams’s argument on appeal only addresses one possible basis for the trial court’s finding of breach.  The trial court’s order includes a general conclusion that “[n]o genuine issue of material fact exists and Coulam is entitled to judgment as a matter of law that Williams breached the contract.”  Williams argues that he adequately demonstrated his readiness, willingness, and ability to pay, which was a specific ground for breach advanced by Coulam and expressly accepted by the trial court. But Williams does not address any other arguments for breach made by Coulam in the trial court, for example, that Williams breached by retaining an agent despite his representation and warranty to the contrary contained in the Agreement.  Because Williams has failed to address the remaining arguments raised in the trial court, those arguments are waived.  See Smith v. Tilton, 3 S.W.3d 77, 84 (Tex. App.—Dallas 1999, no pet.); cf. Star-Telegram, Inc. v. Doe, 915 S.W.2d 471, 473 (Tex. 1995) (citing Malooly Bros., Inc. v. Napier, 461 S.W.2d 119, 121 (Tex. 1970)).

Conclusion

          We affirm the judgment of the trial court.

                                                                   Elsa Alcala

                                                                   Justice

Panel consists of Chief Justice Radack, and Justices Alcala, and Massengale.