GXG, Inc. v. Texacal Oil & Gas, Inc.

• Decision Date: 28 July 1994
• Docket Number: No. 13-93-461-CV,13-93-461-CV
• Citation: 882 S.W.2d 850
• Parties: GXG, INC., Appellant, v. TEXACAL OIL & GAS, INC., Appellee.
• Court: Texas Court of Appeals

Page 850

882 S.W.2d 850

GXG, INC., Appellant, v. TEXACAL OIL & GAS, INC., Appellee.

No. 13-93-461-CV.

Court of Appeals of Texas,

Corpus Christi.

July 28, 1994.

Michael A. Dover, Craig P. Henderson, Hunter, Van Amburgh & Wolf, Dallas, for appellant.

Robert L. Joseph, Joseph, Johnson & Whatley, Sinton, for appellee.

Before KENNEDY, GILBERTO HINOJOSA and YANEZ, JJ.

OPINION

YANEZ, Justice.

This is an appeal of an interlocutory order by the trial court effectively continuing a temporary injunction, which had previously been modified and entered pursuant to an agreed order. The action involves GXG's sale of oil and gas interests to Texacal Oil & Gas. We affirm the trial court's ruling.

GXG contends in two points of error that the trial court abused its discretion by failing to dissolve the temporary injunction as requested in a motion for contempt filed by GXG. The order denying the motion for contempt would not be subject to appeal absent this request for dissolution, but the aspect of an order concerning injunctive relief "is reviewable, even though a portion of [the order] may be interlocutory and nonappealable." Prodeco Exploration v. Ware, 684 S.W.2d 199, 201 (Tex.App.--Houston [1st Dist.] 1984, no writ).

The suit underlying this interlocutory appeal concerns GXG's sale of oil and gas interests to Texacal. Texacal purchased these interests partially with cash and partially with a promissory note secured by a deed of trust. Payment on the note was to begin after Texacal received assignment of the interests. Believing that GXG failed to convey all the interests bargained for, however, Texacal never paid the first installment on the note. Consequently, GXG took actions to foreclose on the deed of trust and to suspend Texacal's receipt of funds from various pipeline companies. Texacal applied for and received a temporary injunction, which enjoined GXG from conducting the trustee sale and released certain suspended funds to GXG and other suspended funds to Texacal. The trial court subsequently modified this injunction, which the court then entered pursuant to an agreed order.

Among other things, the court's agreed order directed Texacal to account for all payments and "prepare and actually deliver" all documents necessary to release the suspended funds Texacal was to receive. The order also set a deadline of 10:00 a.m. on June 1, 1993 for compliance, providing that failure to observe the time limit would terminate the injunction "without any prior notice of (or any opportunity to cure) such Breach and without further order of this Court."

On June 23 GXG moved for contempt and requested dissolution of the injunction, asserting that Texacal's accounting was inadequate and that Texacal did not provide the necessary documents until June 4. Texacal stipulated that delivery of the documents was not timely, but the court nonetheless overruled GXG's motion for contempt and denied all relief. GXG contends that either breach should have dissolved the injunction by its own terms and brings two points of error claiming the trial court abused its discretion by failing to enforce the order as agreed. We disagree.

GXG's first point of error concerns the alleged inadequacy of Texacal's accounts as a cause for the injunction's termination by its own terms. The record contains conflicting testimony about Texacal's diligence in ascertaining GXG's requirements and about the completeness of the information Texacal provided. We have previously addressed the matter of appellant's burden in such an interlocutory appeal:

The burden of proving that the trial court, in denying a motion to dissolve a temporary injunction issued prior to a trial on the merits, abused its discretion is on the litigant who attacks the court's action.

State v. Friedmann, 572 S.W.2d 373, 375 (Tex.Civ.App.--Corpus Christi 1978, writ ref'd n.r.e.). Moreover, "all reasonable presumptions [must] be indulged in support of the trial court's judgment." Valenzuela v. Aquino, 763 S.W.2d 43, 44 (Tex.Civ.App.--Corpus Christi 1988, no writ). By long tradition under Texas law, the trial court enjoys broad license in interlocutory injunctive rulings, which "should not be overturned unless the record discloses a clear abuse of discretion." Texas Foundries v. International Molders & Foundry Workers Union, 151 Tex. 239, 248 S.W.2d 460, 462 (1952). The facts of record, with all inferences drawn in a light favorable to the trial court's ruling, show no abuse of discretion in finding Texacal's accounting minimally adequate to sustain the injunction. Appellant GXG has not met the burden of proof and we therefore overrule the first point of error.

Regarding GXG's second point of error, the order calls for automatic dissolution of the injunction upon any breach of the agreed terms. Texacal has admitted such a breach in stipulating that it failed to deliver the release documents until three days after the deadline. GXG contends that the aspect of an agreed order that partakes in the nature of a contract wholly removes this matter from the discretion of the trial court. Again, we disagree.

In support of their argument about the contractual character of an agreed order, appellant GXG cites Wagner v. Warnasch, 156 Tex. 334, 295 S.W.2d 890 (1956), Spradley v. Hutchison, 787 S.W.2d 214 (Tex.App.--Fort Worth 1990, writ denied), and Giraud v. Reserve Realty, 94 S.W.2d 198 (Tex.Civ.App.--San Antonio 1936, writ ref'd). These three cases stand for the well-established rule that an agreed order disposing of all issues in a case is both a judgment and contract binding upon the parties. But the case before us now does not involve an order disposing of all issues in the case. Although the language of the injunction appears to offer the last word on the subject, we must ignore such matters of form and focus on the character and function of the order instead. Del Valle Indep. School Dist. v. Lopez, 845 S.W.2d 808, 809 (Tex.1992); Conway v. Irick, 429 S.W.2d 648, 649 (Tex.Civ.App.--Fort Worth 1968, writ ref'd). The cases cited by GXG have no bearing on our decision in this matter.

GXG's position is not, however, without legal precedent. See Gregory v. White, 604 S.W.2d 402 (Tex.Civ.App.--San Antonio 1980, writ ref'd n.r.e.), cert. denied, 452 U.S. 939, 101 S.Ct. 3081, 69 L.Ed.2d 953 (1981). The Gregory court perceived "no justification either in law or logic for applying a different rule to agreed interlocutory judgments than to agreed final judgments." Id. at 403-04. Nevertheless, we find the reasoning in Gregory less convincing than the countervailing rationale underlying Rawlins v....