Bandier Realty Partners, LLC and Switchback Ventures, LLC v. SSC Opportunity Partners, LLC

ACCEPTED
01-13-00782-CV
FIRST COURT OF APPEALS
HOUSTON, TEXAS
10/12/2015 12:22:05 PM
CHRISTOPHER PRINE
CLERK
No. 01-13-00782-CV
In the Court of Appeals for the First District FILED IN
1st COURT OF APPEALS
Houston, Texas HOUSTON, TEXAS
10/12/2015 12:22:05 PM
CHRISTOPHER A. PRINE
Clerk
BANDIER REALTY PARTNERS, LLC
AND SWITCHBACK VENTURES, LLC,
Appellants,
v.
SSC OPPORTUNITY PARTNERS, LLC,
Appellee.
On Appeal from the 215th District Court,
Harris County, Texas, Cause No. 2011-43194,
the Hon. Elaine H. Palmer, presiding
APPELLEE’S MOTION FOR REHEARING
TO THE HONORABLE JUSTICES OF THE FIRST COURT OF APPEALS:
Comes now, SSC Opportunity Partners, LLC (“SSC”) and files this Motion
for Rehearing. In support of this Motion, SSC shows the Court the following:
This Court should grant rehearing and affirm the trial court’s judgment
because the evidence presented to the jury supports its finding that both Bandier
Realty Partners, LLC’s and Switchback Ventures, LLC’s (collectively the “Bandier
Defendants”) tortious actions caused SSC’s damages. The Court’s legal-
Appellee’s Motion for Rehearing Page 1
sufficiency analysis, however, fails to account for this evidence and, instead, rests
on a version of the facts and evidence that is different than the one that the jury
heard and accepted. As a result, the legal-sufficiency analysis does not comply
with the standards articulated by the Supreme Court and should be revised.
Similarly, because evidence supports the causation finding, the Court’s reliance on
HMC Hotel Properties II Ltd. Partnership v. Keystone-Texas Property Holding
Corporation is misplaced. 439 S.W.3d 910 (Tex. 2014). Ultimately, the jury
heard the causation evidence and resolved any conflicts in SSC’s favor. Because
the Court’s opinion fails to give proper deference to this result, rehearing is proper.
A. Background.
As explained at length in SSC’s brief, this case involves a real estate
transaction in which Bandier Realty (and its principals), who were acting as SSC’s
fiduciaries, continually attempted to force their way into a deal that SSC found and
put together. [SSC Br. at 1-18]. When those attempts failed, the Bandier
Defendants schemed (without SSC’s knowledge) to cut SSC out of the deal. [Id. at
8-18].
The Bandier Defendants’ plan succeeded because they chased off SSC’s
investor, Larry Johnson. At trial, Johnson blamed his departure on two events
attributable to the Bandier Defendants. [8 RR 29-31]. First, the Bandier
Defendants convinced Charter Title, another SSC fiduciary, to disregard SSC’s
Appellee’s Motion for Rehearing Page 2
instructions by returning Johnson’s earnest money to him and providing
Switchback’s earnest money to the seller rather than Johnson’s. [SSC Br. at 4-11].
Second, the Bandier Defendants’ principals crashed a meeting between SSC,
Johnson, and the seller, and made misrepresentations about their alleged
participation in the deal. [Id. at 11-12]. As result of the Bandier Defendants’
behavior, Johnson “had about all the fun he could stand on that deal” and
withdrew. [Id. at 11-17; 8 RR 29].
The Bandier Defendants then took advantage of SSC’s loss of its investor
and looming contractual deadlines by fraudulently inducing SSC to sign away its
interests in the deal. [SSC Br. at 12-18; 7 CR 9918]. As a result of the Bandier
Defendants’ actions, SSC, which put the deal together, was left with no interest in
the property and Bandier’s principals, who were supposed to be SSC’s fiduciaries,
ended up with multi-million dollar interests. [SSC Br. at 17-18].
The jury heard all of the details of the Bandier Defendants’ actions, which
were documented through contemporaneous emails and trial testimony. [Id.].
Ultimately, the jury determined that the Bandier Defendants committed a number
of torts and found $15 million in damages for SSC’s loss of the property, which the
trial court awarded in its judgment. [7 CR 11567-69]. This Court reversed the trial
court’s judgment and rendered judgment for the Bandier Defendants based on its
determination that SSC presented no legally-sufficient causation evidence. [Op. at
Appellee’s Motion for Rehearing Page 3
22; App. A]. Although the Court recognized that evidence supported a finding that
the Bandier Defendants’ actions chased off Johnson, it held that SSC failed to
introduce evidence showing that Johnson would have moved forward with the deal
in the absence of defendants’ torts. [Id. at 14-20]. However, SSC presented
evidence that the jury properly credited, which the Court’s opinion does not
mention, showing that Johnson would have continued to work with SSC to develop
the property but for the Bandier Defendants’ actions.
B. The Court’s legal-sufficiency analysis does not follow City of
Keller.
Rehearing should be granted because the Court’s legal-sufficiency analysis
does not comport with the process outlined by the Texas Supreme Court in City of
Keller v. Wilson. 168 S.W.3d 802, 807 (Tex. 2005). Specifically, the Court’s
opinion fails to follow City of Keller and its progeny because it does not review the
evidence in the light most favorable to the verdict and because it omits causation
evidence that supports the jury’s verdict. By applying the correct standard of
review to the evidence in this case, only one determination is proper—that SSC
presented legally-sufficient causation evidence.
1. City of Keller requires deference to the jury’s interpretation of the
evidence.
As the Court’s opinion recognizes, City of Keller articulated the process and
standards for conducting a legal-sufficiency review of a trial court’s judgment.
Appellee’s Motion for Rehearing Page 4
168 S.W.3d at 807; [Op. at 11]. When reviewing the legal sufficiency of the
evidence, a court must “view the evidence in the light favorable to the verdict,
crediting favorable evidence if reasonable jurors could, and disregarding contrary
evidence unless reasonable jurors could not.” Id. at 807; see also Regal Fin. Co. v.
Tex Star Motors, Inc., 355 S.W.3d 595 (Tex. 2010). Similarly, a court should
“indulge every reasonable inference that would support” the jury’s finding.
Klentzman v. Brady, 456 S.W.3d 239, 267-68 (Tex. App.—Houston [1st Dist.]
2014, pet. filed) (citing City of Keller, 168 S.W.3d at 822). Relevant here, a legal-
sufficiency challenge to a finding fails when more than a scintilla of evidence
supports the finding. Pointe West Ctr., LLC v. It’s Alive, Inc., No. 01-14-00779-
CV, 2015 WL 5299467, at *3 (Tex. App.—Houston [1st Dist.] Sept. 10, 2015, no
pet. h.) (citing Haggar Clothing Co. v. Hernandez, 164 S.W.3d 386, 388 (Tex.
2005)); Klentzman, 456 S.W.3d at 268. Thus, to overcome a legal-sufficiency
challenge, an appellee must only point to evidence that “rises to a level that would
enable reasonable and fair minded people to differ in their conclusions.” Pointe
West, 2015 WL 5299467, at *3. The ultimate test for legal sufficiency is whether
“the evidence at trial would enable reasonable and fair-minded people to reach the
verdict under review.” Id.; see also Del Lago Partners, Inc. v. Smith, 307 S.W.3d
762, 770 (Tex. 2010).
Appellee’s Motion for Rehearing Page 5
When conducting a legal-sufficiency review, a court also must defer to a
jury’s determination of conflicting evidence. City of Keller, 168 S.W.3d at 820
(“[C]ourts reviewing all the evidence in a light favorable to the verdict must
assume that jurors resolved all conflicts in accordance with that verdict.”). This is
because the jury is the sole judge of the witnesses’ credibility and any weight to
give their testimony. Id. at 819; see also Republic Petroleum LLC v. Dynamic
Offshore Res. NS LLC, No. 01-14-00370-CV, 2015 WL 5076700, at *6 (Tex.
App.—Houston [1st Dist.] Aug. 27, 2015, no pet. h.); Jefferson v. Helen Fuller &
Assocs. Health, Inc., No. 01-11-00199-CV, 2012 WL 2357431, at *13 (Tex.
App.—Houston [1st Dist.] June 21, 2012, pet. denied) (mem. op.) (“As the fact-
finder, the jury had the sole responsibility to assess the credibility of the witnesses,
and it could choose to believe or disbelieve all or part of any witness’s
testimony.”).
2. The Court’s opinion fails to credit evidence that the jury
accepted.
Although the Court’s opinion briefly mentions these principles, it fails to
apply them to the evidence in this case. The Court’s legal-sufficiency analysis
rests on its determination that, although evidence established that the Bandier
Defendants’ tortious actions caused Johnson to leave the deal, SSC presented no
evidence that Johnson was going to move forward with SSC to buy the property
absent the defendant’s actions. [Op. at 14-20]. It bases that conclusion on (1)
Appellee’s Motion for Rehearing Page 6
SSC’s supposed lack of financial ability to complete the purchase; and (2) several
issues with the property that allegedly would have prevented Johnson from
partnering with SSC. [Id.]. The problem with this determination is that it ignores
evidence of SSC’s ability to proceed with the deal, testimony from Johnson that he
would have moved forward but for the defendants’ actions, and evidence
establishing that the other issues did not prevent Johnson’s participation in the
deal. [SSC Br. at 38-45].
a. SSC had the ability to use its option with or without an
investor.
The Court’s emphasis on the fact that “SSC lacked the financial ability to
purchase the land for $5 million without an investor or equity partner” does not
affect the legal-sufficiency analysis. [Op. at 14-15]. This is because the
undisputed evidence established that SSC could have completed the purchase with
an investor and that SSC actively sought investors for the project. [11 RR 99, 218-
19]. Based on this evidence, the jury found, in Question 32, that SSC “ha[d] the
financial capability to exercise the option . . . .” [7 CR 9923].
Moreover, the jury also heard unchallenged expert testimony that SSC had a
variety of potential ways that it could monetize its interest in the deal without an
investor. That testimony came from SSC’s expert, Jeffrey Spilker, who explained
that SSC could also have realized the value of the option by contributing the option
to a joint venture or by selling the option. [10 RR 193-94]. Because SSC had
Appellee’s Motion for Rehearing Page 7
various avenues to exercise the option on the property, this does not negate the
causation evidence.
b. Johnson testified that he would have moved forward but for
the Bandier Defendants’ actions.
The Court also incorrectly reaches the conclusion that “there is no evidence
that Johnson intended to purchase the 101 acres, give or loan SSC the money to do
so, invest in SSC, or form a joint business entity with SSC for the purpose of
purchasing and developing the property.” [Op. at 15-16]. This conclusion, which
the Court bolsters with anecdotal testimony about issues existing with the property,
ignores evidence that the jury could have credited that demonstrated Johnson’s
intent to move forward. Indeed, the Court’s opinion fails to mention Johnson’s
unequivocal testimony that he would have continued forward with SSC if the
Bandier Defendants had not convinced Charter to disregard SSC’s instructions and
return his earnest money on the property:
Q Is it a fair statement for you to say that - - well, is it a fair
statement that you would have continued to move forward had
that [earnest] money not been sent back to you?
A I think that would be a fair statement. Continuing to work on it.
[8 RR 30-31]. Similarly, Doug Britton, SSC’s principal, testified that Johnson’s
stated reasons for leaving the deal only involved the Bandier Defendants’
behavior—not other issues related to the property. [12 RR 137, 235-36].
Appellee’s Motion for Rehearing Page 8
c. Other evidence allowed the jury to determine that Johnson
would have stayed in the deal.
Instead, the Court attempts to point to evidence of other issues that would
have kept Johnson from proceeding with the deal. This evidence does not change
the proper outcome because the jury also heard evidence and testimony
establishing that Johnson knew of the issues and moved forward anyway. To the
extent that Johnson’s testimony conflicted with his actions, this was a credibility
issue for the jury to determine. City of Keller, 168 S.W.3d at 819; Republic
Petroleum, 2015 WL 5076700, at *6; Jefferson, 2012 WL 2357431, at *13.
Because the jury determined this issue in SSC’s favor, it cannot be disregarded.
For example, the Court concludes that because SSC failed to obtain an
extension of the inspection period in the earnest money contract, issues such as a
“lack of utilities, drainage, rights of way, access roads, and annexation by a MUD
district . . . meant that [Johnson] would not go forward with the transaction.”1 [Op.
at 15]. In reality, Johnson never testified that any of these issues caused him to
leave the deal. Instead, he stated that “we could have gotten comfortable with
some of them without having them done if we felt like it could be done later.” [8
RR 37]. Although Johnson admitted that they “weren’t to that point,” the only
reason that they did not continue with the deal was the Bandier Defendants’
1
The extension of the inspection period and the deletion of the so-called “financial-strength”
provision in the earnest money contract were provisions included in the letter agreement
executed with Johnson. [21 RR Ex. 116].
Appellee’s Motion for Rehearing Page 9
actions. [8 RR 29-31, 37]. Similarly, when Britton learned Johnson’s reasons for
leaving the deal, the inspection period and property issues were not mentioned.
[12 RR 137, 230, 235-36]. Because there is no evidence that these issues played a
role in Johnson’s departure or prevented him from moving forward with the deal,
they cannot affect the legal-sufficiency analysis.
The Court also determines that SSC presented no evidence that Johnson
“would have retreated from his demand to eliminate the financial-strength
condition or to extend the inspection period [in the earnest money contract].” [Op.
at 19]. This statement fails to account for SSC’s evidence showing that Johnson
knew that the financial-strength provision would not be deleted and that no
extension would be granted but that he moved forward anyway by giving SSC
$32,500 that Johnson knew would become non-refundable. This is legally-
sufficient causation evidence to allow the jury to infer that those provisions did not
prevent Johnson from participating in the deal. See Ford Motor Co. v. Castillo,
444 S.W.3d 616, 621 (Tex. 2014) (“[W]here the circumstantial evidence is not
equally consistent with either of two facts, and the inference drawn by the jury is
within the ‘zone of reasonable disagreement,’ a reviewing court cannot substitute
its judgment for that of the trier-of-fact.”) (quoting City of Keller, 168 S.W.3d at
822).
Appellee’s Motion for Rehearing Page 10
With regard to SSC’s inability to obtain deletion of the earnest money
contract’s financial-strength provision, the evidence at trial established that
Johnson knew that, at the time he gave SSC the $32,500 in earnest money, the
seller “would like to have [the financials] by the end of the week if possible.” [21
RR Ex. 115, 119]. Yet, Johnson continued to move forward with the deal until the
Bandier Defendants interfered. Britton gave similar testimony:
Q Well, you didn’t get . . . a deletion of the financial strength
provision.
A Larry Johnson in a phone call that day asked me to extend it
throughout the week. I got that, and then we had all of the
events that took place this week.
[12 RR 189]. Similarly, Johnson never testified that SSC’s inability to obtain
deletion of the financial-strength provision caused him to leave the deal or that it
would have prevented him from going forward. This allowed the jury to determine
that the financial-strength provision did not prevent Johnson from moving forward.
The jury also heard evidence that allowed it to determine that SSC’s
inability to obtain an extension of the inspection period did not affect Johnson’s
participation in the deal. Although the Court’s opinion states that “[t]here is no
evidence in the record that Johnson abandoned [his] demands [for an extension of
the inspection period],” the evidence established that Johnson knew that no
extension would be given at least one week before he gave SSC the $32,500. [Op.
at 16; 8 RR 18-19, 21, 37-39; 20 RR Ex. 89-90]. Despite this knowledge, Johnson
Appellee’s Motion for Rehearing Page 11
gave Britton $32,500 in earnest money that Johnson knew would become non-
refundable. [8 RR 21-22, 24; 20 RR Ex. 85]. After giving SSC the earnest money,
Johnson continued to work on the deal. [8 RR 18-19, 23, 31; 21 RR Ex. 119, 132,
147-48, 150-51]. In fact, at no time did Johnson ever tell Britton or the seller that
he would not move forward without an extension. [8 RR 18-19, 23]. It was not
until after the Bandier Defendants’ actions at the December 1 meeting that Johnson
finally decided to withdraw. [8 RR 39-40]. Moreover, Britton testified that, while
Johnson initially required an extension to move forward, he later “changed his
mind” on that issue. [12 RR 128]. Given this evidence, the jury properly could
have determined that the inspection period did not play a role in Johnson’s
departure or prevent him from moving forward.2
The Court’s opinion casts this evidence aside by concluding that Johnson’s
$32,500 was a loan secured by a promissory note and was thus “not at risk.” [Op.
at 16]. Whether or not Johnson’s money was at risk does not affect the analysis.
The jury heard evidence that Johnson, with full knowledge that the seller would
not meet his demands to delete the financial-strength provision or extend the
inspection period, continued to move forward with the SSC deal. This evidence
created an issue for the jury to determine—Johnson’s intent—which it resolved in
2
Although the Court’s opinion states that Johnson’s “testimony unequivocally showed that he
would not proceed with the deal without an extension of the inspection period,” it does not
provide any such testimony. [Op. at 16-17].
Appellee’s Motion for Rehearing Page 12
SSC’s favor. A reasonable juror could credit Johnson’s actions and testimony,
while disregarding any conflicting testimony, to conclude that Johnson would have
continued with the deal without an extension, deletion of the financial-strength
provision, or resolution of the other issues. Because the evidence allowed the jury
to make that finding, this Court cannot set it aside. City of Keller, 168 S.W.3d at
827.
3. The HMC Hotel Properties decision does not control the outcome
in this case.
The Court’s opinion also relies upon the Supreme Court’s recent HMC Hotel
Properties decision to support its legal-sufficiency holding. [Op. at 17-19]; 439
S.W.3d at 910. The HMC Hotel Properties decision, which involves very different
facts, offers no applicable analysis. In HMC Hotel Properties, the hotel (referred
to as “Host”) leased the Riverwalk hotel in San Antonio from Keystone, which
owned the property beneath the hotel along with the Riverwalk Mall. Id. at 911.
Under the terms of their lease agreement, Keystone was obligated to give Host
notice when it decided to sell to a third party “and afford [Host] a reasonable
period of time” of up to 90 days in which to attempt to negotiate to purchase the
property. Id. at 912.
When Keystone decided to sell both the hotel and the mall to a third party, it
provided Host with 75 days’ notice. Host never made an offer and, after initially
telling Keystone it would waive its negotiation rights under the lease, Host
Appellee’s Motion for Rehearing Page 13
eventually sent a letter stating it would not provide a waiver. Id. Keystone sued
after the sale fell through, claiming in relevant part that Host’s letter caused the
deal to falter because Keystone could not secure title insurance without a waiver.
Id.
The jury awarded damages against Host and the trial court entered judgment
for Keystone. Id. The court of appeals affirmed the damage award, but the
Supreme Court reversed, finding that Keystone presented no evidence that Host’s
actions caused its damages. Specifically, the Supreme Court held that no evidence
supported causation because, among other things, (1) the title insurers never were
going to insure without a waiver from Host; and (2) Host was never obligated to
waive its rights. Id. at 913-17. Thus, the Court determined that Host’s letter did
not lead to the destruction of the deal. Id. at 915 (“The deal failed not because of a
letter, but because Keystone was unable to convince Host to voluntarily relinquish
its rights.”).
This is far different from Johnson’s explicit testimony that it was the
Bandier Defendants’ actions that caused him to change his mind and abandon the
deal. [8 RR 29-31]. Even more importantly, unlike HMC Hotel Properties,
Johnson explicitly testified that he would have continued forward with the deal if
the Bandier Defendants had not caused Charter to reject Johnson’s earnest money.
[Id.]. Unlike HMC Hotel Properties, the jury also heard evidence of Johnson’s
Appellee’s Motion for Rehearing Page 14
actions in moving forward with the deal despite knowledge that certain issues had
not been resolved. See supra 10-13. Because the jury in this case had sufficient
evidence to determine that the Bandier Defendants’ actions caused SSC’s damages,
HMC Hotel Properties does not control and rehearing is proper.
C. The Court’s decision creates bad policy.
In addition to its failure to comply with City of Keller, the Court’s opinion
also creates a scenario in which a tortfeasor can insulate itself from liability by
sabotaging a deal early enough to render damages uncertain. Indeed, under this
Court’s analysis, if a defendant breaks up a business relationship or transaction
early enough in the process, it never can be liable for damages because the parties
have not consummated a final deal:
Here, the evidence showed only that Johnson might have
consummated the deal or provided SSC with the funds to do so. This
is not sufficient to establish to the but-for element of cause in fact,
which requires reasonable certainty and cannot rest on a mere
possibility.
[Op. at 20].
In addition to failing to properly credit evidence of Johnson’s intention to
continue with the deal absent the Bandier Defendants’ actions, such a holding
creates an incentive for wrongdoers to scuttle a transaction at the earliest point to
prevent any liability for damages. The Court brushes these concerns aside and
suggests that SSC should have sought equitable fee forfeiture. [Op. at 21-22].
Appellee’s Motion for Rehearing Page 15
This does not answer the problem created by the Court’s holding. Although fee
forfeiture may be available in certain fiduciary situations, it only applies when a
deal has actually been consummated involving the fiduciary. Factually, this is a
rare situation and, in any event, if a tortfeasor breaches its fiduciary duty
effectively enough, then under the Court’s holding, there would not be sufficient
evidence to hold them liable for their actions—whether in equity or in damages.
The Court can easily solve this problem by rehearing this case and altering its
legal-sufficiency analysis to take into account the other evidence showing
Johnson’s willingness to move forward with the deal but for the Bandier
Defendants’ actions.
CONCLUSION
For the foregoing reasons, SSC respectfully requests that the Court grant its
motion for rehearing and affirm the trial court’s judgment.
Appellee’s Motion for Rehearing Page 16
Respectfully submitted,
/s/ David Keltner
David E. Keltner
State Bar No. 11249500
david.keltner@kellyhart.com
Jody S. Sanders
State Bar No. 24051287
jody.sanders@kellyhart.com
KELLY HART & HALLMAN LLP
201 Main Street, Suite 2500
Fort Worth, Texas 76102
817.332.2500—Telephone
817.878.9280—Telecopier
ATTORNEYS FOR APPELLEE
CERTIFICATE OF COMPLIANCE
1. This motion complies with the type-volume limitations of Texas Rule of
Appellate Procedure 9.4(i)(2)(B) because it contains 3,619 words, excluding
the parts of the motion exempted by Texas Rule of Appellate Procedure
9.4(i)(1).
2. This motion complies with the typeface requirements of Texas Rule of
Procedure 9.4(e) because this motion has been prepared in a proportionally
spaced typeface using “Microsoft Word 2010” in fourteen (14) point “Times
New Roman” style font.
/s/ David Keltner
David E. Keltner
Appellee’s Motion for Rehearing Page 17
CERTIFICATE OF SERVICE
The undersigned hereby certifies that a true and correct copy of the above
and foregoing document has been served upon counsel via electronic filing on
October 12, 2015:
David M. Gunn
dgunn@beckredden.com
Erin H. Huber
ehuber@beckredden.com
Beck Redden LLP
1221 McKinney, Suite 4500
Houston, Texas 77010
Counsel for Appellants
Bandier Realty Partners, LLC
and Switchback Ventures, LLC
/s/ David Keltner
David E. Keltner
Appellee’s Motion for Rehearing Page 18
Appendix A
Opinion issued August 27, 2015
In The
Court of Appeals
For The
First District of Texas
————————————
NO. 01-13-00782-CV
———————————
BANDIER REALTY PARTNERS, LLC
AND SWITCHBACK VENTURES, LLC, Appellants
V.
SSC OPPORTUNITY PARTNERS, LLC, Appellee
On Appeal from the 215th District Court
Harris County, Texas
Trial Court Case No. 2011-43194
MEMORANDUM OPINION
A jury awarded appellee SSC Opportunity Partners, LLC $15 million in
actual damages for fraud and breach of fiduciary duty in connection with a real-
estate transaction. Appellants Bandier Realty Partners, LLC and Switchback
Ventures, LLC appeal from the adverse judgment against them.
We conclude that, as in the case of HMC Hotel Properties II LP v. Keystone-
Texas Property Holding Corp., 439 S.W.3d 910 (Tex. 2014), the evidence is
legally insufficient to support the jury’s verdict with respect to its finding that any
actual damages suffered by SSC were caused by the actions of Bandier Realty and
Switchback. Since SSC did not pursue any other theory of recovery, we sustain the
appellants’ fourth issue, reverse the judgment of the trial court, and render
judgment that SSC take nothing.
Background
Douglas Britton formed SSC Opportunity Partners, LLC for the purpose of
purchasing and developing real estate in the northern suburbs of Houston, where
Exxon eventually built a corporate campus. Britton engaged the services of a real-
estate broker, Bandier Realty Partners, LLC, in connection with this transaction.
On August 2, 2010, SSC entered into an earnest-money contract to purchase
a 101-acre tract of land in Harris County for approximately $5 million. Within
three days of the contract’s execution, the buyer was required to deposit $25,000 in
earnest money, which would become non-refundable after a period of due
diligence. A down payment of $1 million was due at closing, and the sellers agreed
to finance the remaining $4 million balance if the purchaser or its assignee could
demonstrate its “financial strength” and close the transaction within the time
allotted by the contract.
2
SSC lacked the $25,000 that was needed for the initial earnest-money
payment. Robert D. Banzhaf and L.S. “Trey” Halberdier, III, who jointly owned
Bandier Realty, began working with Britton to find investors. On August 4, 2010,
Switchback Ventures, LLC—a company owned by Banzhaf and Halberdier—
deposited $25,000 as earnest money.
Halberdier then asked Britton to sign a document that he said was intended
to protect Switchback’s $25,000 investment. Halberdier had drafted this
agreement, which the parties call the “Switchback Agreement,” in the form of a
letter from Britton to Switchback, which identified Britton as “[t]rustee and agent
to assist in the acquisition and/or contractual arrangements of . . . referenced land
in Harris County.” It stated that Britton was authorized by Switchback “to
represent the interest, monetary consideration of Earnest Money in said Contracts,
and perform Contracts for Trey Halberdier or any other Managing Member of
Switchback Ventures, LLC and any other subsidiaries, partners or affiliates.” The
only land referenced was the 101 acres, and the only contract identified was the
earnest-money contract that Britton had signed on behalf of SSC. The Switchback
Agreement also stated that Britton would “take full directive from [Switchback] in
terms of duties to perform, responsibilities, and any other actions that relate to the
$25,000.00 earnest money deposit.” Without reading it, Britton signed the
document.
3
Britton, Halberdier, and Banzhaf then decided to search for a partner or
purchaser to execute the real-estate transaction, and the men concurrently began
discussions with different potential investors.
Britton began discussions with Larry Johnson, a successful Houston-area
real-estate developer, about partnering to purchase and develop the property.
Without committing to the investment, Johnson began due diligence, which
revealed several concerns, including the availability of utilities, lack of road access
to the 101 acres, and the conditions upon which sellers had predicated their offer of
financing.
Halberdier and Banzhaf began discussions with other potential investors:
Omero “Rocky” Del Papa, III, Kenneth R. Vaught, Jr., and their business entities
Kenroc Development, LLC and Kenroc, LLC (collectively “Kenroc”). Britton
encouraged Halberdier and Banzhaf’s negotiations with Kenroc, and he gave them
investment information to use in their presentations. Britton would later testify that
he had authorized Bandier Realty to engage in these negotiations. Bandier Realty
negotiated a potential deal with Kenroc. Contemporaneous emails from Britton
showed that he understood the terms of the proposed deal—assignment of the
earnest-money contract to Kenroc with both Bandier Realty and SSC later serving
as real-estate brokers for subdivided parcels of land and both sharing in the
commissions.
4
In addition, Bandier Realty negotiated its own contingent agreement with
Kenroc and the sellers’ agent. In an email dated November 28, Halberdier told the
sellers’ agent that if “Britton (SSC)” did not approve the Kenroc proposal, Bandier
Realty would withdraw the earnest money from escrow, causing a default on the
contract. At that point, Kenroc and Bandier Realty would enter into a new contract
with the sellers with the same closing date, terms, and conditions. In another email
sent later that day, Halberdier told Banzhaf, Del Papa, and Vaught that Britton had
agreed to the Kenroc deal in principle.
But the next day, Britton entered into a letter agreement with Johnson. In
exchange for a loan of $32,500, which was secured by a promissory note, Britton
agreed to obtain an extension of the inspection period in the earnest-money
contract and the deletion of its financial-strength provision. Britton further agreed
that he would “work together exclusively” with Johnson “towards a mutually
acceptable agreement for the assignment of the [earnest money] [c]ontract from
Britton’s affiliate to an affiliate of Johnson.” That day, Britton gave Johnson a
copy of the Switchback Agreement, which he referenced as “the only single
document I have executed with Bandier.”
Britton delivered to the title company a cashier’s check in the amount of
$32,500, representing the $25,000 earnest money and a payment of $7,500 to
extend the inspection period. He also delivered a letter that he termed a “release,”
5
addressed to Switchback Ventures. Britton instructed the title company that it was
“not authorized to release the Cashier’s Check contained herewith until you receive
a signed counterpart of the release and return a copy to me by email.”
The letter to Switchback stated that its purpose was to return the $25,000
earnest money in full satisfaction of any duties Britton owed by virtue of the
Switchback Agreement. It continued:
Please acknowledge your receipt and acceptance of the
foregoing in the appropriate place below, which shall in any event be
deemed upon your acceptance of the Deposit being returned to you
herewith, and which acceptance shall also be deemed an absolute
quitclaim and release of any interest you may claim to any earnest
money heretofore deposited pursuant to that certain purchase and sale
agreement by and between SSC Opportunity Partners, LLC and OU
Land Acquisition, LP and OU Land Acquisition Two, LP for a certain
100.61 acre tract of land located in Harris County, Texas (the
“Contract”).
You are hereby again advised that your offer to invest money
with Purchaser under the Contract is not accepted. The foregoing shall
not be deemed to otherwise affect any commission to which you may
be expressly entitled pursuant to the Contract.
Halberdier refused to sign the release. Rather, he asked Britton to assign the
earnest-money contract from SSC to Bandier Realty.
The next day, the seller’s agent contacted the title company to inquire about
the earnest money, which had not yet been transferred. The Switchback earnest
money was then sent to the sellers, and Johnson’s earnest money was returned.
6
By now hostility had grown among the parties. Britton, Halberdier, and
Banzhaf met at Johnson’s office to attempt to resolve their differences. Johnson
and the seller’s agent were also present, but they left the room to allow the men to
work out their problems. Two days later, Johnson informed Britton that he was no
longer interested in the investment opportunity.
By early December 2010, there had been no showing of financial strength by
SSC, Britton, Halberdier, Banzhaf, Switchback, or Bandier Realty. On
December 6, the sellers informed SSC that it had two business days to deliver a
letter of intent or an agreement among SSC, Bandier Realty, and Del Papa, the
proposed equity partner, to be signed by all parties. In addition, the sellers offered
one additional business day for Del Papa to satisfy the financial-strength provision.
On December 8, SSC, Bandier Realty, and Switchback entered into a
memorandum of agreement (“MOA”) calling for the formation of a business entity
called “Newco”—to be owned by Bandier Realty, SSC, and a majority equity
investor—that would acquire and develop the 101 acres. Bandier Realty and SSC
would own equal minority shares of the entity. The following day, the sellers
approved Del Papa’s financial statements as satisfying the financial-strength
provision.
Bandier Realty and Switchback then asked SSC to assign the earnest-money
contract to Del Papa as trustee of yet another entity to be formed in the future. The
7
document that was sent to Britton, which the parties call the “Del Papa Assignment
Agreement (DPAA),” included a provision, paragraph 8, which canceled and
nullified the MOA signed the previous day by Bandier Realty and SSC. Britton
struck out the language in paragraph 8 that canceled the MOA, signed the revised
document, and sent it to Halberdier, Banzhaf, their attorneys, and the sellers’ agent.
With Britton’s revisions, there were then two documents purporting to assign the
earnest-money contract: the MOA which assigned the contract to Newco; and the
DPAA as revised by Britton, which assigned it to Del Papa, as trustee, without
nullifying the MOA. The sellers’ agent informed Britton that unless he executed
the assignment without striking through paragraph 8, the sellers would declare the
earnest-money contract in default. Britton thereafter signed a clean copy of the
DPAA. The DPAA provided that SSC would share equally in any commission
received by Bandier Realty as a result of the earnest-money contract. But the
DPAA made no provision for any further participation by SSC in the development
of the 101 acres, and SSC did not participate further.
In July 2011, after Exxon announced its plans to build a corporate campus
adjacent to the 101 acres, SSC filed the underlying lawsuit against the Bandier
parties (Halberdier, Banzhaf, Bandier Realty Partners, LLC, Switchback Ventures,
LLC, and Bandier Management Partners, LLC), the investors who had worked
with them, and the title company that had handled the escrow. SSC alleged various
8
tort theories including breach of fiduciary duty and fraud. SSC also sought
exemplary damages.
The case was tried to a jury. Britton’s theory of the case was that SSC lost its
opportunity to partner with Johnson to purchase and develop the 101 acres because
the defendants—including Bandier Realty and Switchback—interfered and caused
Johnson to back out of the transaction. Britton testified about how he came up with
the idea for this particular development and the time and effort he spent to research
its potential viability. He also testified that he had no money to finance it and had
even borrowed money from his parents. Britton testified that Johnson had been
very interested in pursuing this opportunity. Although the sellers’ agent had
already denied Johnson’s request to extend additional time, Britton nevertheless
believed he could persuade the sellers to extend the due-diligence period. Britton
testified that when Johnson loaned him the earnest money, it was for the purpose of
moving “forward towards closing.” Britton contended that as a result of the
defendants’ actions, “SSC lost the option which it valued at $20 million.”
Johnson testified, however, that he and Britton never reached an agreement
about purchasing the 101-acre tract. He said that he had been confused about who
had the rights to the contract and “still unsettled” on due diligence. He testified that
there were numerous unresolved issues, any one of which would have been enough
to end the deal. He identified a number of specific concerns, including: “when the
9
roads would be built,” “whether Exxon was really going to go forward with their
deal,” “how the drainage would end up working,” “getting road right-of-ways to
extend some of the roads,” and “how we were going to do the MUD districts.”
Johnson also said that he was not prepared to finalize a deal without an extension
of the inspection period, and the sellers had not agreed to extend it.
The jury found in favor of SSC on its claims for fraud and breach of
fiduciary duty, awarding $15 million in actual damages, plus exemplary damages
against Bandier Realty Partners, Banzhaf, and Halberdier in the amount of
$500,000 each.
Analysis
“Generally, when a party presents multiple grounds for reversal of a
judgment on appeal, the appellate court should first address those points that would
afford the party the greatest relief.” Bradleys’ Elec., Inc. v. Cigna Lloyds Ins. Co.,
995 S.W.2d 675, 677 (Tex. 1999). Accordingly, we begin by addressing the
appellants’ sufficiency-of-the-evidence arguments because they apply to all claims
and both remaining defendants. In addition, reversal on the grounds of legal
insufficiency would result in rendition of judgment for Bandier Realty and
Switchback. See id.; see also TEX. R. APP. P. 43.3 (“When reversing a trial court’s
judgment, the court must render the judgment that the trial court should have
10
rendered, except when: (a) remand is necessary for further proceedings; or (b) the
interests of justice require a remand for another trial.”).
We review legal sufficiency challenges to determine whether the evidence
“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
determining whether legally sufficient evidence supports a challenged finding, we
must consider the evidence that favors the finding if a reasonable factfinder could,
and we must disregard evidence contrary to the challenged finding unless a
reasonable factfinder could not. Id. We may not sustain a legal sufficiency, or “no
evidence,” point unless the record demonstrates: (1) a complete absence of a vital
fact; (2) the court is barred by rules of law or of evidence from giving weight to the
only evidence offered to prove a vital fact; (3) the evidence offered to prove a vital
fact is no more than a mere scintilla; or (4) the evidence conclusively establishes
the opposite of the vital fact. Id. at 810. The factfinder may choose to “believe one
witness and disbelieve others” and “may resolve inconsistencies in the testimony
of any witness.” McGalliard v. Kuhlmann, 722 S.W.2d 694, 697 (Tex. 1986); see
City of Keller, 168 S.W.3d at 820–21.
Proximate cause is an element of each of SSC’s tort claims. See Nat’l Prop.
Holdings, L.P. v. Westergren, 453 S.W.3d 419, 423 (Tex. 2015) (fraudulent
inducement); ERI Consulting Eng’rs v. Swinnea, 318 S.W.3d 867, 881 (Tex. 2010)
11
(civil conspiracy); Prudential Ins. Co. of Am. v. Fin. Review Servs., Inc., 29
S.W.3d 74, 77 (Tex. 2000) (tortious interference with a contract); Finger v. Ray,
326 S.W.3d 285, 291 (Tex. App.—Houston [1st Dist.] 2010, no pet.) (breach of
fiduciary duty). There may be more than one proximate cause of an occurrence.
Del Lago Partners, Inc. v. Smith, 307 S.W.3d 762, 774 (Tex. 2010).
“The components of proximate cause are cause in fact and foreseeability.”
Ryder Integrated Logistics, Inc. v. Fayette Cnty., 453 S.W.3d 922, 929 (Tex.
2015). “Cause in fact is essentially but-for causation.” Id. A tortious act satisfies
the cause-in-fact component of proximate cause when it is “a substantial factor in
causing the injury and without which the injury would not have occurred.” Del
Lago Partners, 307 S.W.3d at 774 (citing W. Invs., Inc. v. Urena, 162 S.W.3d 547,
551 (Tex. 2005)). “If the defendant’s negligence merely furnished a condition that
made the injury possible, there can be no cause in fact.” Urena, 162 S.W.3d at 551.
Proximate cause “cannot be established by mere conjecture, guess or
speculation.” Doe v. Boys Clubs of Greater Dallas, Inc., 907 S.W.2d 472, 477
(Tex. 1995). To establish causation, the evidence “must show more than a
possibility.” Lenger v. Physician’s Gen. Hosp., Inc., 455 S.W.2d 703, 706 (Tex.
1970). “Verdicts must rest upon reasonable certainty of proof.” Id. Cause in fact
may be established by direct or circumstantial evidence, including expert-opinion
testimony. See, e.g., Havner v. E-Z Mart Stores, Inc., 825 S.W.2d 456, 459 (Tex.
12
1992). However, “[b]are baseless opinions will not support a judgment even if
there is no objection to their admission in evidence.” City of San Antonio v.
Pollock, 284 S.W.3d 809, 816 (Tex. 2009). When an expert opinion is admitted
without objection, it may be considered probative even if its basis is unreliable. Id.
at 818. “But if no basis for the opinion is offered, or the basis offered provides no
support, the opinion is merely a conclusory statement and cannot be considered
probative evidence, regardless of whether there is no objection.” Id. “[A] claim
will not stand or fall on the mere ipse dixit of a credentialed witness.” Burrow v.
Arce, 997 S.W.2d 229, 235 (Tex. 1999).
The jury in this case found that Bandier Realty breached its fiduciary duty to
SSC, intentionally interfered with the earnest-money contract, participated in a
civil conspiracy that damaged SSC, and fraudulently induced SSC to enter into the
Del Papa Assignment Agreement. The jury also found that Switchback participated
in Bandier Realty’s breach of fiduciary duty, participated in a civil conspiracy that
damaged SSC, and assisted or encouraged Bandier Realty’s interference with the
earnest-money contract.
Appellants challenge the evidentiary basis for the jury’s conclusions.
Specifically, they contend that SSC lacked the financial ability to exercise the
option by purchasing the land for $5 million on its own, and its only potential
investor, Larry Johnson, would not have invested in the project regardless of their
13
actions. As such, the appellants argue there was legally insufficient evidence that
their actions were a but-for cause of SSC’s failure to acquire the property.
In response, SSC argues that Johnson’s actions and testimony created a fact
issue about whether he would have “proceeded with the SSC deal” but for the
actions of Bandier Realty and Switchback. In particular, it contends that Johnson’s
action in “giving SSC the non-refundable earnest money,” despite knowing that the
sellers had not extended the inspection period or deleted the financial-strength
provision, showed that he would have moved forward with the deal. SSC argues
that this action conflicted with Johnson’s testimony, creating a credibility issue that
the jury resolved in its favor and which we must credit under the applicable
standard of review. SSC argues that the jury was “free to conclude” that both the
conduct of Bandier Realty and other concerns about the property “played a role in
Johnson’s departure.” Thus, SSC reasons that the jury’s finding that Bandier
Realty and Switchback proximately caused its injuries is supported by sufficient
evidence.
We disagree with SSC’s depiction of the record. First, the evidence showed
that SSC lacked the financial ability to purchase the land for $5 million without an
investor or equity partner. Although Britton asserted at trial that he could have
closed the deal, he conceded on cross-examination that he could not have done so
without investors. Similarly, the sellers’ agent also testified that SSC lacked the
14
financial ability to purchase the property independently. In addition, SSC never
satisfied the financial-strength provision, which was a necessary condition for the
sellers to finance the $4 million balance that would have remained after the
$1 million down payment. Under the earnest-money contract, the failure to satisfy
the financial-strength provision was grounds for the sellers to declare the contract
in default.
Second, there is no evidence that Johnson intended to purchase the
101 acres, give or loan SSC the money to do so, invest in SSC, or form a joint
business entity with SSC for the purpose of purchasing and developing the
property. Johnson testified that he was interested in the property, but the unfinished
due diligence would have been enough to end the deal for him. He testified that he
was concerned about the lack of utilities, drainage, rights of way, access roads, and
annexation by a MUD district. Without an extension of the inspection period, any
one of these unresolved issues was “a killer,” significant enough for him to decline
the investment opportunity. Yet he never received any assurance that the
inspection period would be extended, which meant that he would not go forward
with the transaction.
The only written agreement between Johnson and SSC was the
November 29 “Letter Agreement Regarding Assignment of Contract.” This
document did not purport to actually assign the earnest-money contract. Instead,
15
the parties agreed “to work together exclusively towards a mutually acceptable
agreement for the assignment of the Contract from Britton’s affiliate to an affiliate
of Johnson which benefits both Britton and Johnson prior to the end of the
Inspection Period.” It also required Britton to obtain an extension of the inspection
period and deletion of the financial-strength condition. This agreement did not
provide any terms of financial compensation, carried interest, or any sort of profit
sharing. By its plain terms it was an executory contract that did not immediately
assign the earnest-money contract.
Still SSC argues that Johnson’s provision of $32,500 in nonrefundable
earnest money showed, contrary to his testimony, that he was prepared to assume
the contract and consummate the deal and was willing to abandon his demands to
delete the financial-strength condition and extend the inspection period. However,
the evidence in the record shows that the $32,500 was a loan secured by a
promissory note. Thus, while the earnest money was nonrefundable as to SSC,
Johnson’s investment was not at risk: he could recover his money from Britton. In
addition, Johnson’s letter agreement with Britton provided that the consideration
for the loan was Britton’s promise to obtain an extension of the inspection period
and a deletion of the financial-strength condition. There is no evidence in the
record that Johnson abandoned these demands. Instead, his testimony
unequivocally showed that he would not proceed with the deal without an
16
extension of the inspection period, an option that was available to him under the
letter agreement with Britton.
The insufficiency of this evidence is evident in light of a similar case
recently decided by the Supreme Court of Texas, addressing an issue of but-for
causation in a case arising from a real estate deal that fell through. The case of
HMC Hotel Properties II LP v. Keystone-Texas Property Holding Corp., 439
S.W.3d 910 (Tex. 2014), involved the attempted sale of the Rivercenter Mall and
the land beneath the San Antonio Riverwalk hotel. HMC Hotel Props. II LP, 439
S.W.3d at 911. The hotel leased the land beneath it from Keystone-Texas Property
Holding Corporation. Id. The lease included a right-of-first refusal provision,
affording it up to 90 days to attempt to negotiate an agreement to purchase the land
if Keystone decided to sell it. Id. at 911–12. Nothing in the lease required the hotel
to execute a waiver of this provision if it chose not to purchase under those
circumstances. Id. at 914–15.
After the properties were listed for sale, a potential buyer emerged for the
two properties, offering $166 million for both. Id. at 911. Keystone invited the
hotel to make an offer to purchase, but it also requested the hotel waive its rights
under the lease provision. Id. at 912. The hotel initially indicated that it would sign
the requested waiver, but after meeting with the potential buyer, the hotel
suspected that the purchase price had been inflated to discourage it from making an
17
offer. Id. At that point, the hotel informed Keystone by letter that no waiver was
forthcoming. Id. Notably, at all relevant times, the title insurers had stated that they
required a waiver from the hotel in order to issue a “clean” title insurance policy.
Id. at 913–14.
When the sale of the land beneath the hotel fell through, the hotel sued for
breach of contract, and Keystone countersued for tortious interference with a
contract. Id. at 912. The jury found for Keystone, which had argued that the letter
from the hotel had been “passed to the proposed title insurers, [and had] scuttled
the sale.” Id. The court of appeals held that the evidence was sufficient to show
that the letter “proximately caused the deal’s demise.” Id.
In the Supreme Court, the hotel argued that there was no evidence of but-for
causation, i.e., “no evidence show[ed] the outcome would have been different if
[the hotel] had not sent its letter.” Id. at 913. The Supreme Court agreed. First, it
observed that the hotel had no obligation to provide the waiver that the title
insurers demanded, and that there was no evidence that the insurers would have
dropped that demand. Id. at 915. Second it rejected testimony about how the title
insurers might have “insured around” the lease provision after the expiration of 90
days and in the absence of the hotel’s letter. Id. at 916. The Supreme Court said,
“[I]n the end, all of this testimony is simply speculation about what the title
insurers might have done had [the hotel] handled itself differently. Testimony
18
based on nothing but speculation is evidence of nothing at all.” Id. Third, the Court
agreed that the evidence showed that the hotel’s letter had a “substantial effect” on
the deal, but it explained that “testimony that the letter was a substantial factor in
bringing about harm to Keystone is only half of the cause-in-fact element. . . .
Keystone also had to show that absent [the hotel’s] letter, the harm would not have
occurred.” Id. at 917 (citation omitted).
This case is similar to HMC Hotel Properties. SSC’s argument that Johnson
would have provided the funding it needed to exercise the option but for the
actions of the appellants fails because it is too speculative. Nothing in the evidence
shows that Johnson would have provided SSC with funding but for the actions of
Bandier Realty and Switchback. Rather, the evidence shows that even if the
substituted earnest money had been accepted, and even if Halberdier, Banzhaf, and
Britton had comported themselves amicably and with civility at the meeting on
December 1, Johnson still would have harbored doubts about the investment
because his due diligence was incomplete. There is no evidence in the record that
Johnson would have retreated from his demand to eliminate the financial-strength
condition or to extend the inspection period. And his loan of money to Britton did
not require him to abandon those demands. To the contrary, it was predicated upon
them.
19
Here, the evidence showed only that Johnson might have consummated the
deal or provided SSC with the funds to do so. This is not sufficient to establish to
the but-for element of cause in fact, which requires reasonable certainty and cannot
rest on a mere possibility. See Lenger, 455 S.W.2d at 706.
SSC argues that because there can be more than one proximate cause, the
jury was “free to conclude” that the conduct of Bandier Realty and Switchback
“played a role in Johnson’s departure.” We agree that the evidence supports such a
conclusion. Johnson testified that he became “disgusted” by the conduct of Bandier
Realty, i.e., Halberdier and Banzhaf, as well as that of Britton. He testified that it
created doubt as to who was in control of the earnest-money contract. But the
question before us is whether the evidence supports the verdict actually rendered,
which included an award of actual damages. Actual damages require proof of
causation. See Doe, 907 S.W.2d at 477; Lenger, 455 S.W.2d at 706. And evidence
that the appellants played a role in bringing about the injury SSC complains of “is
only half of the cause-in-fact element.” HMC Hotel Props., 439 S.W.3d at 917.
SSC also had to show that absent the conduct of Bandier Realty and Switchback,
the injury would not have occurred. Id. This they failed to do.
Finally, SSC argues that as a matter of policy, a finding that the evidence
was insufficient to support the verdict as to causation would “create an unintended
safe-harbor from liability for defendants who breach their fiduciary duties early in
20
a transaction.” It argues that the appellants’ actions “chas[ed] off Johnson before
he could finalize the SSC deal.” It argues that we therefore should affirm based on
“the settled principles that a fiduciary should be punished for its breaches and that
relationships of trust should be protected.”
Texas law provides equitable remedies for breach of fiduciary duty that are
distinct from awards of actual damages. See, e.g., ERI Consulting Eng’rs, Inc., 318
S.W.3d at 874 (equitable forfeiture is distinguishable from an award of actual
damages because it serves a separate function of protecting fiduciary
relationships); Burrow, 997 S.W.2d at 240 (fee forfeiture available in absence of
proof of actual damages for an attorney’s breach of fiduciary duty); Kinzbach Tool
Co. v. Corbett-Wallace Corp., 138 Tex. 565, 573–74, 160 S.W.2d 509, 514 (1942)
(“It would be a dangerous precedent for us to say that unless some affirmative loss
can be shown, the person who has violated his fiduciary relationship with another
may hold on to any secret gain or benefit he may have thereby acquired.”); Saden
v. Smith, 415 S.W.3d 450, 469 (Tex. App.—Houston [1st Dist.] 2013, pet. denied)
(“Even if a fiduciary does not obtain a benefit by violating his duty, he still may be
required to forfeit the right to compensation for his work.”).
SSC did not seek the alternative remedy available to it under Texas law: fee
forfeiture. Bandier Realty was SSC’s broker, and its payment was the commission
it earned when the sale of the 101 acres was closed. SSC did not seek recompense
21
for the commission Bandier Realty earned. In addition, although SSC did seek
damages for unjust enrichment, the jury returned a take-nothing verdict on that
question. Thus, we reject SSC’s policy-based arguments.
We sustain the appellants’ fourth issue, and we hold that the evidence is
legally insufficient to support the verdict as to causation. As a result of our
resolution of this issue, it is unnecessary for us to address the other arguments
raised by the appellants. TEX. R. APP. P. 47.1.
Conclusion
We reverse the judgment of the trial court and render judgment that SSC
take nothing from appellees Bandier Realty Partners and Switchback Ventures.
Michael Massengale
Justice
Panel consists of Chief Justice Radack, and Justices Higley and Massengale.
22