Fitness Evolution, L.P. v. Headhunter Fitness, L.L.C., 05-13-00506-CV
| Decision Date | 22 May 2015 |
| Docket Number | No. 05-13-00506-CV,05-13-00506-CV |
| Parties | FITNESS EVOLUTION, L.P., JOSEPH S. MULROY, AND GLENEAGLES SHOPPING CENTER PLANO, TEXAS, L.P., THROUGH ITS ASSIGNEE, JOSEPH S. MULROY, Appellants v. HEADHUNTER FITNESS, L.L.C., JEFF KAYE, NICHOLAS L. TURNER, MICHAEL KITTLESON, JEFF WITTENBERG, BILL BAKER, WILLOW BEND FITNESS CLUB, KAYE/BASSMAN INTERNATIONAL CORPORATION, SAGEBRUSH PARTNERS, LTD., VAUGHN R. HEADY, JR., MARK W. LEWIS, JAMES DUGGAN, AND DUGGAN REALTY ADVISORS, L.L.C., Appellees |
| Court | Texas Court of Appeals |
FITNESS EVOLUTION, L.P., JOSEPH S. MULROY,
AND GLENEAGLES SHOPPING CENTER PLANO, TEXAS, L.P.,
THROUGH ITS ASSIGNEE, JOSEPH S. MULROY, Appellants
v.
HEADHUNTER FITNESS, L.L.C., JEFF KAYE, NICHOLAS L. TURNER,
MICHAEL KITTLESON, JEFF WITTENBERG,
BILL BAKER, WILLOW BEND FITNESS CLUB,
KAYE/BASSMAN INTERNATIONAL CORPORATION, SAGEBRUSH PARTNERS, LTD., VAUGHN R. HEADY, JR., MARK W. LEWIS, JAMES DUGGAN,
AND DUGGAN REALTY ADVISORS, L.L.C., Appellees
No. 05-13-00506-CV
Court of Appeals Fifth District of Texas at Dallas
May 22, 2015
On Appeal from the 429th Judicial District Court Collin County, Texas
Trial Court Cause No. 429-00529-2010
OPINION
Before Justices Bridges, Lang, and Evans
Opinion by Justice Lang
This case involves a complicated web of claims, counterclaims, and motions for summary judgment respecting space in a shopping center leased by a company that operated a fitness club and the alleged liability of those involved in securing that lease once the lease default had occurred. Appeals and cross-appeals were perfected as to sixteen of the original twenty-one parties from a trial court judgment that incorporated several interlocutory summary judgment orders, resulting in all parties taking nothing on the claims and counterclaims.
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The claims we address below, to name a few, range from anticipatory repudiation of the lease,1 tortious interference with an existing contract, rescission, fraud, fraudulent inducement, and misrepresentation. While the trial court's final judgment disposes of all claims on the merits, in order to evaluate the issues raised on appeal, we must address standing, which is a component of subject-matter jurisdiction, procedural issues, and then consider the merits of the various motions for summary judgment. Accordingly, we recount the extensive evidence in the record2 and necessarily address the numerous arguments made by each party as to each issue.
All of the original twenty-one parties in the trial court filed several motions for summary judgment, addressing scores of claims, counterclaims, third-party claims,3 and defenses. In the following preliminary paragraphs, we identify the parties and the particular issues raised by the sixteen parties on appeal.
First, we identify the appellants and the arguments they raise on appeal. Fitness Evolution, L.P., Joseph S. Mulroy, individually, and Gleneagles Shopping Center Plano, Texas, L.P., through its assignee, Joseph S. Mulroy (collectively the Fitness Evolution Group) appeal the trial court's final judgment in favor of Kaye/Bassman International Corporation (Kaye/Bassman), Sagebrush Partners, Ltd., Vaughn R. Heady, Jr., and Mark Lewis (collectively the Sagebrush Group), James Duggan and Duggan Realty Advisors, L.L.C., (collectively the Duggan Group), and Headhunter Fitness, L.L.C., Jeff Kaye, Nicholas L. Turner, Michael Kittleson, Jeff Wittenberg, Bill Baker, and Willow Bend Fitness Club (collectively the Headhunter Group) which incorporated several interlocutory orders.4 The Fitness Evolution
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Group raises three issues on appeal arguing the trial court erred when it granted summary judgment in favor of: (1) the Sagebrush Group; (2) the Headhunter Group; and (3) the Duggan Group. The Sagebrush Group, the Headhunter Group, and the Duggan Group each filed a separate brief on appeal.5 Also, in the Fitness Evolution Group's notice of appeal, they list Kaye/Bassman as a party to the appeal. However, the Fitness Evolution Group raises no issues relating to their claims against Kaye/Bassman in their brief on appeal and Kaye/Bassman did not file a brief on appeal.
Next, we address the cross-appellants and the issue they raise on cross-appeal. The Headhunter Group and Kaye/Bassman filed a notice of cross-appeal. In the cross-appeal, the Headhunter Group raised one issue contending the trial court was in error when it rendered judgment concluding the Headhunter Group's counterclaims were barred by the settlement agreement with mutual releases and ordered a take-nothing judgment on all of the Headhunter Group's counterclaims. Although it filed a notice of cross-appeal, Kaye/Bassman did not file a brief on cross-appeal.
Our decision in this case is to vacate, in part, affirm, in part, dismiss, in part, and reverse and remand to the trial court, in part. In so doing, we make eight conclusions. First, we conclude Mulroy, individually, does not have standing to bring his tortious interference with an existing contract claims against the Sagebrush Group and the Duggan Group, or to bring his anticipatory repudiation of the lease claims against the Headhunter Group. Second, we conclude the Fitness Evolution Group has not shown the trial court erred when it granted Kaye/Bassman's September 20, 2011 motion for no-evidence summary judgment. Third, we conclude Mulroy,
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individually, has not shown the trial court erred when it granted Baker's portion of the October 20, 2012 motion for traditional summary judgment on the remaining claims. Fourth, we conclude the trial court erred when it granted the Sagebrush Group's November 7, 2012 motion for traditional summary judgment on the tortious interference with an existing contract claims of Fitness Evolution and Mulroy, as assignee of Gleneagles's claims. Fifth, we conclude the trial court erred when it granted the Duggan Group's March 9, 2012 amended motion for summary judgment and ordered a take-nothing judgment on the tortious interference with an existing contract claims of Fitness Evolution and Mulroy, as assignee of Gleneagles's claims. Sixth, we conclude the trial court erred when it granted the Headhunter Group's October 30, 2012 motion for traditional summary judgment on the remaining claims on their affirmative defense of res judicata. Seventh, we conclude the trial court erred when it concluded the Headhunter Group's counterclaims were barred by the December 4, 2009 settlement agreement with mutual releases and ordered a take-nothing judgment on all of the Headhunter Group's counterclaims. The final and eighth conclusion is, although Kaye/Bassman filed a notice of appeal, Kaye/Bassman has failed to file a brief or raise any issues in its cross-appeal of the trial court's final judgment.
Because we concluded Mulroy, individually, has no standing to bring his tortious interference with an existing contract claims against the Sagebrush Group and the Duggan Group, and anticipatory repudiation of the lease claims against the Headhunter Group, the portion of the trial court's final judgment ordering a take-nothing judgment on those claims is vacated and those claims are dismissed for want of jurisdiction. In addition, because Kaye/Bassman failed to file a brief or raise any issues in its cross-appeal, the portion of the cross-appeal brought by Kaye/Bassman is dismissed. Accordingly, as stated above, the trial court's final judgment is vacated, in part, affirmed, in part, dismissed, in part, and reversed and remanded, in part.
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The factual and procedural background of this case is complicated and must be described at length in order to properly address the issues presented on appeal. Accordingly, we separate our description of the factual and procedural histories and describe them in detail for the most part in chronological sequence. The factual background in this opinion is merely a recitation of some of the statements and evidence contained in the extensive record on appeal.6
On July 20, 2001, Fitness Evolution leased space in the commercial shopping center known as Gleneagles Plaza from the owner, DDC/Gleneagles #1, L.P., for the purpose of operating a health and fitness club, spa, and sports training facility. The lease term was for ten years and the base rent was scheduled to increase during that period. Duggan signed the lease as president of the Duggan Development Corporation, which was the general partner of DDC/Gleneagles #1. Mulroy guaranteed the lease. Fitness Evolution's general partner was 588 Management, L.L.C., which held a one percent interest in the company. Sam Mulory, who is Mulroy's son, was a limited and managing partner with sixty-nine percent interest in Fitness Evolution, and Mulroy was a limited partner with a thirty percent interest in Fitness Evolution.
On July 1, 2005, DDC/Gleneagles #1 conveyed its interest in the lease to Gleneagles. After this conveyance, Duggan was no longer involved with the Gleneagles Plaza, except that he continued to conduct his personal exercise at Fitness Evolution. Duggan is the manager and a broker for Duggan Realty.
On December 1, 2006, Fitness Evolution, Sam Mulroy, and Headhunter Fitness, an entity created by Kaye, Turner, Kittleson, Wittenberg, and Baker, executed an asset purchase
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agreement. Turner signed the agreement on behalf of Headhunter Fitness. Pursuant to the asset purchase agreement, Headhunter Fitness purchased all of the physical assets, memberships, and the general operations of Fitness Evolution. Kaye, Turner, Kittleson, Wittenberg, and Baker were also shareholders of Kaye/Bassman, which owns other fitness clubs in the area.
On December 4, 2006, Fitness Evolution assigned its lease at the Gleneagles Plaza to Headhunter Fitness. Mulroy signed a guaranty in favor of Gleneagles, confirming that he remained fully liable for the lease. Kaye, Turner, Kittleson, and Wittenberg signed a separate lease guaranty in favor of Gleneagles in connection with the assignment. This guaranty limited their liability to three month's rent if the lease was not in default during the first twelve months of the assignment. Baker did not sign a guaranty.
Headhunter Fitness operated the fitness club under the name Next Level Fitness. However, Headhunter Fitness experienced financial difficulties. As a result, on August 23, 2007, Fitness Evolution filed its original petition in the 296th Judicial District Court, Collin County, Texas, (2007 Collin County Lawsuit) alleging claims for...
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