Michael Robinson, Carol Robinson and the 2000 Horizon Company, AKA Lighthouse Energy Service Co. v. William Cason and Black Sigma, LLC

Opinion issued July 2, 2013.
In The
Court of Appeals
For The
First District of Texas
————————————
NO. 01-11-00916-CV
———————————
MICHAEL ROBINSON, CAROL ROBINSON AND THE 2000 HORIZON
COMPANY A/K/A LIGHTHOUSE ENERGY SERVICE, CO., Appellants
V.
WILLIAM CASON AND BLACK SIGMA, LLC, Appellees
On Appeal from the 23rd District Court
Brazoria County, Texas
Trial Court Case No. 59473
MEMORANDUM OPINION
In this dispute between business partners, we determine whether the trial
court erred in entering summary judgment to enforce a settlement agreement.
Michael and Carol Robinson and the 2000 Horizon Company a/k/a Lighthouse
Energy Service Company (“Horizon”), appeal from the summary judgment in
favor of William Cason and Black Sigma, LLC. We conclude that the trial court
properly entered summary judgment enforcing the settlement agreement, and we
find no error in the remaining issues on appeal. We therefore affirm.
Background
Michael Robinson founded Horizon and is its majority shareholder. Cason is
a minority shareholder in Horizon. Cason and Robinson together serve on
Horizon’s board of directors.
In September 2010, Cason sued Robinson, alleging that Robinson had
misused corporate funds for personal gain, forged Cason’s signature on promissory
notes, and concealed his actions from the board of directors. Cason brought claims
individually and on behalf of Horizon, including claims for breach of fiduciary
duty, fraud, investor oppression, and theft. The lawsuit (cause number 59473) was
assigned to the 23rd District Court.
While the lawsuit was pending, a property dispute arose between Cason and
Robinson. Robinson had purchased property on behalf of Horizon in 2004 by
borrowing $475,000.00 from a lender named John Benkenstein. In September
2010—around the time Cason sued Robinson—Cason purchased Robinson’s
promissory note, vendor’s lien, and deed of trust from Benkenstein. As assignee,
Cason obtained Benkenstein’s rights under the note, including any claims
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Benkenstein held against Robinson and the right to foreclose on the underlying
property in the event of default. Robinson’s promissory note contains the following
provision regarding notice of acceleration: “[Robinson] and each surety, endorser
and guarantor waive all demand for payment, presentation for payment, notice of
intention to accelerate maturity, notice of acceleration of maturity, protest and
notice of protest . . . .”
After Cason acquired the note, he notified Robinson that he had purchased it
and that Robinson had defaulted on it by failing to maintain proper insurance on
the property, repay taxes paid by the lender, and obey restrictive covenants
imposed on the land. Cason gave Robinson thirty days to cure the defaults. In
reply, Robinson tendered a check in the amount of $9,024.00, maintaining that the
payment cured his defaults.
In November 2010, Cason assigned Robinson’s promissory note to Black
Sigma—a limited liability company in which Cason is the managing member.
Black Sigma accelerated Robinson’s promissory note and demanded payment.
Black Sigma contended that Robinson remained in default by failing to timely pay
property taxes, repay taxes paid by the previous lender, and obey restrictive
covenants. Black Sigma enclosed the appointment of a substitute trustee and notice
of the trustee’s sale along with the notice of acceleration.
3
After Cason transferred the note to Black Sigma, Robinson counterclaimed
in the suit for breach of fiduciary duty, tortious interference, defamation, and
intentional infliction of emotional distress. He contended that Cason had breached
his fiduciary duties to Horizon and interfered with Horizon’s business by
purchasing the promissory note and assigning it to Black Sigma. On the same day
that Robinson filed his counterclaims, he moved for a temporary restraining order
and injunction to prevent Black Sigma from foreclosing on the property. His
motion alleged that Cason operated Black Sigma as an alter ego. All of the parties
agree that the trial court denied Robinson’s motion, but the record does not include
the disposition.
After the 23rd District Court denied Robinson’s motion, he petitioned the
149th District Court (cause number 61122) for a TRO, temporary injunction, and
permanent injunction to prevent the substitute trustee’s foreclosure sale. The 149th
District Court enjoined the sale and, after discovering the pending action before the
23rd District Court, signed a handwritten order that both cases be presented to the
23rd District Court to determine whether consolidation was proper. The
handwritten order permitted the substitute trustee to accept bids at the foreclosure
sale but left unchanged the temporary injunction against any transfer of the deed
until the 23rd District Court ruled on the matter.
4
The 23rd District Court consolidated cause number 61122 in the 149th
District Court into cause number 59473 in the 23rd District Court; the court’s order
consolidating the cases vacated the TRO and handwritten order entered by the
149th District Court. The substitute trustee subsequently conveyed the deed to the
property to the highest bidder at the foreclosure sale, Black Sigma.
In March 2011, Robinson filed third-party claims against Black Sigma to
quiet title and for wrongful foreclosure and breach of contract. Robinson alleged
that he had timely cured all defaults under the promissory note, Black Sigma had
failed to provide adequate notice of the trustee’s sale, and the sale violated the
149th District Court’s TRO. Robinson moved for summary judgment; Black Sigma
filed a cross-motion for summary judgment, asserting that the TRO did not apply
to void the sale, and Black Sigma properly exercised its rights as assignee of the
promissory note. The trial court signed an interlocutory order granting summary
judgment in favor of Black Sigma in May 2011.
During this time, Cason’s suit for breach of fiduciary duty remained pending
before the 23rd District Court, along with Robinson’s counterclaims. In late
December 2010, Robinson appeared for his deposition in a separate lawsuit. Cason
also appeared at the deposition.
During the course of the deposition, Cason and Robinson reached a
settlement. They dictated its terms to the court reporter, who transcribed them in an
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independent volume labeled with the 59473 cause number. Generally, the
settlement requires Robinson to acknowledge that Black Sigma holds title to the
disputed property and convey two tracts of land, their legal descriptions set forth in
an attached exhibit, to Cason. In exchange, Cason agreed to convey his outstanding
Horizon stock to Robinson and resign from any position he holds with Horizon.
Cason also agreed to let Robinson remain on the foreclosed property for a period
of six months, conditioned on his maintaining insurance on the property and
running his company in a commercially reasonable manner during that occupancy.
The parties mutually agreed to exchange standard releases and to formalize
the dictated provisions in a formal settlement agreement. Further, they agreed that
the parties would bear their own attorney’s fees and costs in connection with the
litigation. They expressly referenced the consolidated cause in agreeing that “[a]ll
the claims are dismissed against all entities.”
The dictated settlement also provides that, in the case of any dispute among
the parties concerning the interpretation of the agreement—including the meaning
of any ambiguous term or the wording of the releases—the 23rd District Court
would be the ultimate arbiter, so that the settlement “is not an agreement to make
an agreement, but an absolute full, final, complete agreement” resolving all claims
between Cason and Robinson.”
6
In February 2011, Cason moved to enforce the settlement agreement and for
judgment on all claims. Cason attached a copy of the December 2010 deposition
transcript to his motion along with an unsigned draft of a written settlement
memorializing the December 2010 agreement. Cason then moved for summary
judgment, asking the trial court to enforce the settlement agreement against
Robinson. Cason again tendered a copy of the deposition transcript to the trial
court, along with the court reporter’s notarized acknowledgment of the settlement
agreement and a copy of a substitute trustee’s deed. Cason included a copy of his
lawyer’s affidavit certifying the above documents.
In response, Robinson maintained that the pleadings did not support Cason’s
motion for summary judgment because Cason had not amended his pleadings to
include a breach-of-contract claim. Alternatively, Robinson contended that the
settlement was unenforceable because it did not comply with Rule 11, lacked
material terms to be enforced as a contract, or that an affirmative defense (mistake,
fraud, or duress) prevented its enforcement. Robinson supported his motion with
affidavits, including an affidavit from his attorney at the December 2010
deposition. His attorney averred that Cason and Robinson had agreed to a
settlement in principle during the deposition, but that not all of the terms of the
settlement were included in the reporter’s record—specifically, it omitted a
promise by Cason to pay money to Robinson. According to Robinson’s attorney,
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the contract term ordering the payment was reserved for a final, written agreement
in order to permit the parties time to arrange financial details. Robinson also
tendered his affidavit. Robinson averred that he suffered from a chronic illness, he
assented to the settlement only after a lengthy deposition, and he agreed to it based
on promises that additional material terms would be memorialized in a document
drafted after the deposition. Finally, Robinson attached the affidavit of an
individual connected with Black Sigma, who averred that Cason had told him that
he promised to pay Robinson “a lump sum of $250,000.00, an annuity of
$5,000.00 per month for twenty years, and . . . health insurance coverage for one
year” in exchange for the settlement. In reply, Cason objected to the affidavits and
amended his petition to allege breach of the settlement agreement; the trial court
declined to consider the amended petition because it was not timely filed.
In August 2011, Robinson moved to recuse the trial judge, citing his social
relationship with Cason’s attorney and a number of adverse rulings. After a
hearing, the presiding judge of the administrative district denied Robinson’s
motion.
In September 2011, the trial court entered summary judgment in favor of
Cason, enforcing the settlement agreement reached at the December 2010
deposition.
Discussion
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I. Summary judgment enforcing the December 2010 Settlement Agreement
A. The trial court’s summary judgment order conforms with the pleadings
As a preliminary matter, Robinson claims that proper pleadings do not
support the September 2011 summary judgment, because Cason did not timely
amend his petition to include a breach-of-contract claim. Cason replies that his
motion to enforce the settlement agreement provides sufficient notice of the
contract claim.
Settlement agreements may be enforced as contracts, even when one party
withdraws its consent to the settlement before judgment is entered on the
agreement. Ford Motor Co. v. Castillo, 279 S.W.3d 656, 663 (Tex. 2009); Mantas
v. Fifth Court of Appeals, 925 S.W.2d 656, 658 (Tex. 1996); Padilla v. LaFrance,
907 S.W.2d 454, 461 (Tex. 1995); see TEX. CIV. PRAC. & REM. CODE ANN.
§ 154.071(a) (West 2011) (settlement agreement is enforceable “in the same
manner as any other contract”). The party seeking to enforce the agreement must
pursue a separate breach of contract claim, which is subject to the normal rules of
pleading and proof. Mantas, 925 S.W.2d at 658–59; Padilla, 907 S.W.2d at 462;
Ford, 279 S.W.3d at 663.
A pleading for breach of contract must contain a short statement of the cause
of action sufficient to give fair notice of the claim involved, including an allegation
of a contractual relationship between the parties, and the substance of the contract
9
which supports the pleader’s right to recover. Bayway Servs., Inc. v. Ameri-Build
Constr., L.C., 106 S.W.3d 156, 160 (Tex. App.—Houston [1st Dist.] 2003, no pet.)
(citing Cadle Co. v. Castle, 913 S.W.2d 627, 630–31 (Tex. App.—Dallas 1995,
writ denied). An amended pleading, though, is only one may to raise a claim that a
settlement agreement should be enforced as a contract: a motion seeking
enforcement of a settlement agreement is sufficient to permit the entry of judgment
enforcing the settlement, because it gives the nonmovant notice of the claim
asserted and an opportunity to defend itself. Bayway Servs., 106 S.W.3d at 160
(holding motion to enforce settlement agreement satisfied pleading requirements);
Neasbitt v. Warren, 105 S.W.3d 113, 117 (Tex. App.—Fort Worth 2003, no pet.)
(same). Thus, a motion that satisfies the general purpose of pleadings—which is to
give the other party fair notice of the claim and the relief sought—is sufficient to
allow the trial court to render judgment enforcing the settlement. Bayway Servs.,
106 S.W.3d at 160; Neasbitt, 105 S.W.3d at 117.
Cason moved to enforce the settlement agreement in February 2011. Cason’s
motion alleged that he had sent a document formalizing the transcribed terms to
Robinson and that Robinson had failed to sign and return the document. Cason
attached the December 2010 deposition transcript to his motion along with the
unsigned settlement document he had sent to Robinson. Approximately three
weeks later, Cason moved for final judgment, renewing his contention that the
10
December 2010 deposition transcript evidenced a settlement agreement. Cason
asked the trial court to enter judgment in accord with the settlement agreement’s
terms and order that the parties execute the mutual releases provided for in the
agreement.
Cason’s motion to enforce the settlement agreement provided fair notice of
his claim and the relief sought. See Bayway Servs., 106 S.W.3d at 160. Cason
proffered evidence of a settlement agreement between the parties, alleged that
Robinson had disavowed the agreement, sought its specific performance, and
requested a hearing on the motion. The motion therefore satisfies the general
purposes of pleadings and is sufficient to permit the trial court to render judgment
enforcing the settlement.
B. Summary judgment in favor of Cason’s enforcement claim
Robinson challenges the trial court’s summary judgment order enforcing the
terms of the December 2010 settlement. He contends that a deposition transcript
does not comply with Rule 11 and, in the alternative, that a fact issue exists on
whether the parties’ agreement is otherwise enforceable as a contract. In reply,
Cason maintains that the Rule 11 does not prohibit the trial court from enforcing
the deposition transcript as a settlement agreement and that the agreement is
enforceable under contract law.
11
1. Standard of review
We review de novo the trial court’s grant of a motion for summary
judgment. Provident Life & Accid. Ins. Co. v. Knott, 128 S.W.3d 211, 215–16
(Tex. 2003). To be successful, a motion under Texas Rule of Civil Procedure
166a(c) must establish that no genuine issue exists as to any material fact and that
the movant is entitled to judgment as a matter of law. TEX. R. CIV. P. 166a(c).
When a plaintiff moves for summary judgment on its own claim, the plaintiff must
conclusively prove all essential elements of its cause of action. Rhône–Poulenc,
Inc. v. Steel, 997 S.W.2d 217, 223 (Tex. 1999); City of Houston v. Clear Creek
Basin Auth., 589 S.W.2d 671, 678 (Tex. 1979). If the movant conclusively negates
an element of each of the plaintiff’s causes of action or conclusively establishes its
own cause of action, the burden shifts to the non-movant to respond with evidence
raising a genuine issue of material fact that would preclude summary judgment.
See Rhône-Poulenc, 997 S.W.2d at 222–23. In deciding whether a disputed
material fact precludes summary judgment, we take as true evidence favorable to
the nonmovant and indulge every reasonable inference in the nonmovant’s favor.
Knott, 128 S.W.3d at 215.
2. Applicability of Rule 11
Rule 11 of the Texas Rules of Civil Procedure provides: “Unless otherwise
provided in these rules, no agreement between attorneys or parties touching any
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suit pending will be enforced unless it be in writing, signed and filed with the
papers as part of the record, or unless it be made in open court and entered of
record.” TEX. R. CIV. P. 11; see also Knapp Med. Ctr. v. De La Garza, 238 S.W.3d
767, 768 (Tex. 2007) (citing Padilla, 907 S.W.2d at 460); Tindall v. Bishop,
Peterson, & Sharp, P.C., 961 S.W.2d 248 (Tex. App.—Houston [1st Dist.] 1997,
no pet.). A trial court has a ministerial duty to enforce a valid Rule 11 agreement.
Fortis Benefits v. Cantu, 234 S.W.3d 642, 651 n.58 (Tex. 2007); ExxonMobil
Corp. v. Valence Operating Co., 174 S.W.3d 303, 309 (Tex. App.—Houston [1st
Dist.] 2005, pet. denied).
Our court has held that a settlement agreement transcribed by a court
reporter but not done in open court does not comply with Rule 11. See Tindall, 961
S.W.2d at 251 (“A majority of this Court sitting en banc agrees . . . that the
agreement dictated to and transcribed by the court reporter and filed with the
papers of the case is not a rule 11 agreement.”). Thus, the trial court did not have
the ministerial duty to enforce the transcribed agreement. That the transcribed
agreement fails as a Rule 11 agreement, however, does not preclude Cason from
seeking its enforcement under contract law. See ExxonMobil Corp., 174 S.W.3d at
309 (citing Padilla v. LaFrance, 907 S.W.2d 454, 461–62 (Tex.1995)); Mantas v.
Fifth Court of Appeals, 925 S.W.2d 656, 657 (Tex. 1996); Tindall, 961 S.W.2d at
13
251 (enforcing settlement agreement in accord with contract-law principles). We
thus examine whether the parties formed a binding settlement agreement.
3. Contract formation
Robinson contends that the trial court erred in enforcing the settlement
agreement because it lacks essential terms and, consequently, it does not evidence
the meeting of the minds required to form a binding agreement. Parties form a
binding contract when the following elements are present: (1) an offer, (2) an
acceptance in strict compliance with the terms of the offer, (3) a meeting of the
minds, (4) each party’s consent to the terms, and (5) execution and delivery of the
contract with the intent that it be mutual and binding. Potcinske v. McDonald Prop.
Invs., 245 S.W.3d 526, 529–30 (Tex. App.—Houston [1st Dist.] 2007, no pet.).
“‘Meeting of the minds’ describes the mutual understanding and assent to the
agreement regarding the subject matter and the essential terms of the contract.” Id.
Mutual assent, concerning material, essential terms, is a prerequisite to formation
of a binding, enforceable contract. Id. (citing T.O. Stanley Boot Co. v. Bank of El
Paso, 847 S.W.2d 218, 221 (Tex.1992)). An “essential” term is
one that the parties reasonably regarded, at the time of contracting, as
a vitally important ingredient in their bargain. Failure to fulfill such a
promise, in other words, would seriously frustrate the expectations of
one or more of the parties as to what would constitute sufficient
performance of the contract as a whole.
14
Neeley v. Bankers Trust Co. of Tex., 757 F.2d 621, 628 (5th Cir. 1985), quoted in
Cytogenix, Inc. v. Waldroff, 213 S.W.3d 479, 485 (Tex. App.—Houston [1st Dist.]
2006, pet. denied).
Robinson claims that the transcribed agreement is unenforceable because it
omits terms that the parties anticipated would be included in the final, written
settlement agreement—specifically, the monetary compensation he was to receive
as part of the consideration for the tracts of real property referenced in the
transcription. The transcribed agreement addresses the consideration Robinson is
to receive, but indicates neither that Cason owes him any monetary consideration,
nor refers to future negotiation of an essential monetary term. Parties may agree on
terms sufficient to create a contract, even while leaving other provisions for later
negotiation and agreement. See Scott v. Ingle Bros. Pac., Inc., 489 S.W.2d 554,
555 (Tex.1972); Ski River Dev., Inc. v. McCalla, 167 S.W.3d 121, 133 (Tex.
App.—Waco 2005, pet. denied); cf. TEX. BUS. & COM. CODE ANN. § 2.201(a)
(providing that writing is not insufficient because it omits term, but only written
terms can be enforced). The agreement does not lack the essential element of
consideration. In addition to Cason’s mutual release and dismissal of claims, the
transcribed agreement recites that Robinson is to receive possessory rights to the
business premises for six months; Cason’s resignation from all offices that he
holds or might have held in Horizon, including its board of directors; an agreement
15
that Cason holds no ownership interest, will take no management responsibility,
and will take no role whatsoever in Horizon’s day-to-day or long-term operations;
a permanent injunction preventing Cason from engaging in any interference with
Horizon’s business; the return of any stock that Cason holds in Horizon; and the
return of all documents produced to Cason in the course of the litigation. For the
same reason, the inclusion of additional terms in the written settlement agreement
prepared by Cason does not raise a fact issue concerning the enforceability of the
dictated terms.
Robinson also claims that the transcribed agreement is unenforceable
because it lacks specificity concerning the tracts of land Robinson agreed to
convey to Cason. It is well settled that a land description is sufficient to convey the
property if it furnishes within itself, or by reference to some other existing writing,
the means or data by which the particular land to be conveyed may be identified
with reasonable certainty. AIC Mgmt. v. Crews, 246 S.W.3d 640, 645 (Tex. 2008);
Morrow v. Shotwell, 477 S.W.2d 538, 539 (Tex. 1972). The transcribed agreement
refers to tract of land that is the subject matter of a specified lawsuit and an exhibit
that contains the legal description of two tracts of land, which in turn references
their map locations in the Brazoria County plat records. It also refers to the fact
that Robinson or an entity in his control holds the title to those tracts, and that the
tracts are contiguous or in the same subdivision as the tract at issue in the lawsuit.
16
Robinson complains that the exhibit was added to the transcribed agreement after
the fact, but he does not claim that the descriptions did not exist when the parties
dictated the settlement or that they incorrectly describe the property. Nor does he
contend that the reference to tracts “owned by him or an entity in his control” fails
to identify the conveyances with reasonable certainty. See AIC Mgmt., 246 S.W.3d
at 648–49; Kmiec v. Reagan, 556 S.W.2d 567, 569 (Tex. 1977). We reject
Robinson’s argument that the agreement fails for lack of an essential term.
4. Affirmative defenses
Robinson contends that the trial court erred in rejecting his affirmative
defenses of mistake, statutory fraud, and duress. We consider each in turn.
a. Mistake
A mutual mistake of fact occurs when the parties to an agreement have a
common intention, but the written agreement does not accurately reflect that
intention due to a mutual mistake. See Smith-Gilbard v. Perry, 332 S.W.3d 709,
713 (Tex. App.—Dallas 2011, no pet.); City of The Colony v. N. Tex. Mun. Water
Dist., 272 S.W.3d 699, 735 (Tex. App.—Fort Worth 2008, pet. dism’d). The
elements of mutual mistake are: (1) a mistake of fact; (2) held mutually by the
parties; (3) which materially affects the agreed-on exchange. City of The Colony,
272 S.W.3d at 735. When mutual mistake is alleged, the party seeking to avoid its
obligations under a contract must show what the parties’ true agreement was and
17
that the instrument incorrectly reflects that agreement because of a mutual mistake.
Atl. Lloyds Ins. Co. v. Butler, 137 S.W.3d 199, 213 (Tex. App.—Houston [1st
Dist.] 2004 pet. denied).
To prove a mutual mistake, the evidence must show that both parties were
acting under the same misunderstanding of the same material fact. Walden v.
Affiliated Computer Servs., Inc., 97 S.W.3d 303, 326 (Tex. App.—Houston [14th
Dist.] 2003, pet. denied). A unilateral mistake by one party, combined with
knowledge of that mistake by the other party, is equivalent to a mutual mistake.
Davis v. Grammer, 750 S.W.2d 766, 768 (Tex. 1988). But, “[a] mistake by only
one party to an agreement, not known or induced by acts of the other party[,] will
not constitute grounds for relief.” Smith-Gilbard, 332 S.W.3d at 713–14 (quoting
Johnson v. Snell, 504 S.W.2d 397, 399 (Tex. 1974)).1 The mutual mistake defense
does not exist merely to avoid the results of an unhappy bargain. Williams v.
Glash, 789 S.W.2d 261, 265 (Tex. 1990).
Robinson contends that the mistake was the omission of a monetary
compensation term from the transcribed agreement, rendering it incomplete. But,
neither Robinson nor Cason mistakenly omitted the term; even under Robinson’s
1
Robinson also relies on James T. Taylor & Son, Inc. v. Arlington Independent
School District, 335 S.W.2d 371 (Tex. 1960), in contending that he is entitled to
equitable relief from a unilateral mistake of fact because enforcement of the
agreement with without the monetary compensation terms would be
unconscionable. See id. at 372–73.
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version of the events, he and Cason agreed that they would not address monetary
payment on the record, but would incorporate it in a later agreement subject to
financing conditions. Both Robinson and Cason were present during the
declaration that the transcribed agreement constituted a full, final, and complete
agreement to settle their disputes. Robinson’s regret about the settlement terms
does not raise a fact issue as to a mutual mistake of fact, because even under
Robinson’s version, the parties had not labored under the impression that the on-
the-record settlement incorporated a monetary payment requirement.
b. Statutory fraud
The elements of statutory fraud are: (1) a transaction involving real estate or
stock; (2) during the transaction the other party made a false representation of fact,
made a false promise, or benefitted by not disclosing that a third party’s
representation was false; (3) the false representation or promise was made for the
purpose of inducing the party to enter into a contract; (4) the party relied on the
false representation or promise by entering into the contract; and (5) the reliance
caused the party injury. TEX. BUS. & COM. CODE ANN. § 27.01.
The proponent of the fraud claim must show actual and justifiable reliance.
Grant Thornton LLP v. Prospect High Income Fund, 314 S.W.3d 913, 923 (Tex.
2010). We determine whether Robinson raised a fact issue on justifiability by
inquiring whether, “given a fraud plaintiff’s individual characteristics, abilities,
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and appreciation of facts and circumstances at or before the time of the alleged
fraud, it is extremely unlikely that there is actual reliance on the plaintiff’s part.”
Haralson v. E.F. Hutton Group, Inc., 919 F.2d 1014, 1026 (5th Cir.1990)
(applying Texas law), quoted in Grant Thornton LLP., 314 S.W.3d at 923.
Robinson again points to the allegedly missing monetary consideration term as
grounds for this affirmative defense, but the inclusion of the “full and final
agreement” language in the transcribed agreement put Robinson and his counsel on
notice that any reliance on additional, unspoken contract terms was unjustifiable.
Robinson does not adduce evidence that counters the effect of the written
agreement’s recitations that it contains all material terms. For this reason,
Robinson fails to raise a fact issue that he is entitled to avoid the contract based on
a statutory fraud defense.
c. Duress
In contending that he is entitled to avoid the settlement agreement because
of duress, Robinson complains that he was ill the day the parties reached the
agreement. To avoid a contract based on duress, Robinson would have to prove
that (1) Cason threatened to do some act that he had no legal right to do; (2) the
threat was of such a character as to destroy Robinson’s free agency; (3) the threat
overcame Robinson’s free will and caused him to do that which he would not
otherwise have done and that he was not legally bound to do; (4) the restraint was
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imminent; and (5) Robinson had no present means of protection. See Flameout
Design & Fabrication, Inc. v. Pennzoil Caspian Corp., 994 S.W.2d 830, 837 (Tex.
App.—Houston [1st Dist.] 1999, no pet.) (citing Creative Mfg., Inc. v. Unik, Inc.,
726 S.W.2d 207, 211 (Tex. App.—Fort Worth 1987, writ ref’d n.r.e.)). Robinson
had counsel present during the dictation of the settlement agreement. Robinson
expressly confirmed on the reporter’s record that he had communicated with both
of his attorneys, one of whom was not present, that he understood and approved
the settlement, and that he was satisfied he had been adequately represented by his
attorney in attendance. This confirmation negates any showing that Cason
destroyed Robinson’s free agency or that Robinson had no present means of
protection. Robinson does not adduce controverting evidence. As a result,
Robinson fails to raise a fact issue on his duress claim.
5. Inclusion of Carol Robinson in settlement
Michael Robinson also contends that his wife, Carol, was not present during
the settlement discussions and did not consent to its terms. The transcribed
agreement, however, includes Carol as a settling party. In addition, she and
Michael were both represented by the attorney who had communicated with
counsel in attendance at the settlement, and the record reflects that he understood
and approved of the settlement. In the absence of contrary evidence, an attorney is
generally presumed to be acting within the authority given by the client. Kelly v.
21
Murphy, 630 S.W.2d 759, 761 (Tex. App.—Houston [1st Dist.] 1982, writ ref’d
n.r.e.). No evidence suggests that Carol’s counsel did not have her permission to
consent to the settlement agreement, nor did counsel make any effort to exclude
her from the settlement. As a result, Carol cannot avoid her responsibilities under
the settlement.
We hold that the trial court correctly granted summary judgment enforcing
the transcribed settlement agreement.
C. Remaining issues
Robinson’s remaining issues consist of challenges to the consolidation of the
case pending in the 149th Judicial District Court into the previously filed case
pending in the 23rd Judicial District Court and to the denial of his motion to recuse
the trial judge. Robinson waived these challenges in the settlement agreement.
Waiver is the intentional relinquishment of a known right or intentional conduct
inconsistent with claiming that right. Dep’t of Prot. & Reg. Servs. v. Schutz, 101
S.W.3d 512, 516 (Tex. App.—Houston [1st Dist.] 2002, no pet.). In determining if
a waiver has in fact occurred, the court must examine the acts, words, or conduct
of the parties and it must be “unequivocally manifested” that it is the intent of the
party to no longer assert the right. Id. “Although waiver is ordinarily a question of
fact, when the facts and circumstances are admitted or clearly established, the
question becomes one of law.” Motor Vehicle Bd. v. El Paso Indep. Auto. Dealers
22
Ass’n, 1 S.W.3d 108, 111 (Tex.1999); Tenneco, Inc. v. Enter. Prods., 925 S.W.2d
640, 643 (Tex. 1996).
First, with respect to the consolidation into the underlying suit of Robinson’s
suit for injunctive relief to prevent the foreclosure sale, the agreement declares that
“[t]his global settlement includes the lawsuit that was recently filed to stop the
foreclosure, inclusive of the parties, that was later consolidated by the 23rd Judicial
District Court.” Because Robinson explicitly agreed to settle the disputes arising in
the consolidated case as well as the underlying suit, the propriety of consolidation
is a nonissue: no dispute remains for review.
Second, with respect to the denial of his motion to recuse, we note that the
settlement agreement places the judge presiding in the 23rd Judicial District Court
in an essential and pivotal role. It provides that:
The transcription of this agreement and will be submitted to the Court
for approval of this settlement agreement. The Court will be the
arbiter of the terms of any written document necessary. The Court will
be the final decision-maker if any dispute occurs hereafter as to the
terms of any releases that need to be exchanged between the parties
and the contents of those terms, after each party has advised the Court
what it believed the agreement was.
...
[I]f we can’t agree on the wording, the Court will be submitted each
person’s position, and the Court will ultimately make the decision on
the wording of any release. . . [and] [a]ny ambiguity [will] be resolved
by the Judge of the 23rd Judicial District Court.
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Robinson’s motion did not raise any valid ground for recusal that he had not
discovered before he agreed to the settlement. We hold that Robinson waived any
complaint that the judge should be recused.
Conclusion
We conclude that the trial court properly granted summary judgment
enforcing the December 2010 agreement. We further hold that Robinson waived
his remaining issues on appeal. We therefore affirm the judgment of the trial court.
Jane Bland
Justice
Panel consists of Chief Justice Radack and Justices Bland and Huddle.
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