MacMorran v. Wood, 08-97-00024-CV

• Decision Date: 11 December 1997
• Docket Number: No. 08-97-00024-CV,08-97-00024-CV
• Citation: 960 S.W.2d 891
• Parties: Elizabeth Jane MacMORRAN, Appellant, v. Frank B. WOOD, Terry Cavaleri Wood, and William C. MacMorran, Appellees.
• Court: Texas Court of Appeals

Page 891

960 S.W.2d 891

Elizabeth Jane MacMORRAN, Appellant, v. Frank B. WOOD, Terry Cavaleri Wood, and William C MacMorran, Appellees.

No. 08-97-00024-CV.

Court of Appeals of Texas El Paso.

Dec. 11, 1997.

Rehearing Overruled March 5, 1998.

Jeffrey S. Alley, Scott, Hulse, Marshall, Feuille, Finger & Thurmond, El Paso, for Appellant.

L. Randall Lee, Richard, Lee, Rowley, Cobb & Hall, El Paso, for Appellees.

Before BARAJAS, C.J., and LARSEN and McCLURE, JJ.

OPINION

BARAJAS, Chief Justice.

This appeal arises out of an underlying breach of fiduciary duty, breach of contract, breach of the duty of good faith and fair dealing, deceptive trade practices, fraud, intentional infliction of emotional distress, and civil conspiracy case. Appellees filed special appearances claiming that they are Arizona residents and that they do not have sufficient contacts with Texas to support the exercise of jurisdiction over them. The trial court sustained their special appearances. For the reasons stated below, we affirm the trial court's decision.

I. SUMMARY OF THE EVIDENCE

In 1975, Appellees William MacMorran and Frank Wood formed Associated Restaurant Operators, Inc. ("ARO"), a Texas Corporation. MacMorran and Wood are 50 percent shareholders, as well as officers and directors of ARO. Also in 1975, ARO opened a restaurant in Tucson, Arizona called the Solarium.

In 1983, MacMorran and Wood formed a partnership, WOMAC Investments, which purchased the land and building leased by ARO for the Solarium. The partnership agreement set forth that the only partners were MacMorran and Wood. Further, it stated that the spouses, Appellant MacMorran and Appellee Cavaleri Wood (Cavaleri), were not signing as partners, but only to evidence their consent and approval of the partnership agreement and to bind their community or other interests, if any, in property subject to the partnership agreement. The partners, MacMorran and Wood, also executed a buy-sell agreement regarding the partnership, which further indicated that Appellant and Cavaleri were not signing as partners, but to evidence their consent and approval of the terms and conditions of the agreement and to bind their community interests, if any, in the shares which were the subject of the agreement.

When WOMAC purchased the restaurant property, the existing lease was assigned to WOMAC. Thus, ARO was the lessee and WOMAC became the lessor. On August 1, 1983, the lease was amended and the rent was lowered from $14,000 a month to $6,000 a month. On January 1, 1988, the lease was amended a second time and the rent was raised to $10,000 a month. On January 1, 1990, the lease was again amended and the rent was lowered to $7,000 a month. The rent was lowered one final time, without written addendum, to an amount that equals the mortgage payment.

The underlying suit began with the divorce of Appellant and MacMorran. The divorce decree became final in 1991 and provided in part that Appellant was awarded an undivided one-half interest in their marital community's interest in WOMAC. Subsequently, the judge of the Arizona superior court who handled the divorce proceedings entered a finding that Appellant was not a partner of WOMAC pursuant to the divorce decree. Rather, he found that Appellant was entitled to an undivided 25 percent interest in the assets of WOMAC and that Appellee MacMorran had fulfilled his obligations by transferring said percent to Appellant. Further, he found that Appellant was not entitled to a monthly payment of 25 percent of the gross monthly rent, but only to an undivided 25 percent interest in the net rents.

On June 30, 1992, Wood and MacMorran held a "special meeting" where they dissolved WOMAC and waived the buy-sell agreement. The dissolution took place in Arizona to satisfy the terms of the Arizona divorce decree. The restaurant property was divided as follows: 25 percent to Appellant individually, 25 percent to MacMorran, and 50 percent to Wood and Cavaleri as joint tenants and each was issued a quitclaim deed.

After WOMAC was dissolved, MacMorran and Wood formed a new corporation, MacMorran-Wood Corp., which assumed the lessor's role in the old WOMAC-ARO lease. MacMorran-Wood Corp. used an entity called MW Joint Venture as its agent to collect the rentals from ARO. Believing the arrangement tortious, Appellant filed suit against ARO, MacMorran, Wood, and Cavaleri, alleging that Appellees committed constructive fraud, breach of their fiduciary duty, breach of the duty of good faith and fair dealing, and conspiracy. On June 1, 1995, the trial court heard Appellees' Special Appearance and granted it on January 4, 1996. Appellees were severed from the underlying case and this appeal follows.

II. DISCUSSION

Appellant brings six points of error challenging the trial court's granting of Appellees' special appearances. We begin with a discussion of the standard of review.

A. Standard of Review

When a defendant challenges a court's exercise of personal jurisdiction through a special appearance, he carries the burden of negating all bases of personal jurisdiction. See Kawasaki Steel Corp. v. Middleton, 699 S.W.2d 199, 203 (Tex.1985); Siskind v. Villa Found. for Educ., Inc., 642 S.W.2d 434, 438 (Tex.1982); Nikolai v. Strate, 922 S.W.2d 229, 236 (Tex.App.--Fort Worth 1996, writ denied); Hayes v. Wissel, 882 S.W.2d 97, 99 (Tex.App.--Fort Worth 1994, no writ). When a trial court overrules a special appearance, the defendant should request it to make findings of fact according to T EX.R.CIV.P. 296. Runnells v. Firestone, 746 S.W.2d 845, 849 (Tex.App.--Houston [14th Dist.], writ denied, 760 S.W.2d 240 (Tex.1988). Absent such findings, we view the trial court's judgment as impliedly finding all the necessary facts to support its judgment. Worford v. Stamper, 801 S.W.2d 108, 109 (Tex.1990); In re W.E.R., 669 S.W.2d 716, 716-17 (Tex.1984); Runnells, 746 S.W.2d at 848. Where a complete statement of facts appears in the record, however, these implied findings are not conclusive and an appellant may challenge the sufficiency of the evidence. Roberson v. Robinson, 768 S.W.2d 280, 281 (Tex.1989). Where such points are raised, the standard of review to be applied is the same as that to be applied in the review of jury findings or a trial court's findings of fact. Id.

When a personal jurisdictional question is reviewed, we review all the evidence. Nikolai, 922 S.W.2d at 236; Hotel Partners v. KPMG Peat Marwick, 847 S.W.2d 630, 632 (Tex.App.--Dallas 1993, writ denied). The correct standard of review of the evidence is a factual sufficiency review, not a de novo review. Nikolai, 922 S.W.2d at 236; Hotel Partners, 847 S.W.2d at 632; NCNB Texas Nat'l Bank v. Anderson, 812 S.W.2d 441, 443-44 (Tex.App.--San Antonio 1991, no writ). Thus, we may reverse the decision of the trial court only if its ruling is so against the great weight and preponderance of the evidence as to be manifestly erroneous or unjust. In re King's Estate, 150 Tex. 662, 664-65, 244 S.W.2d 660, 661 (1951); Runnells, 746 S.W.2d at 849. In reviewing such a point of error, we must consider and weigh all of the evidence, both the evidence that tends to prove the existence of a vital fact as well as evidence that tends to disprove its existence. Ames v. Ames, 776 S.W.2d 154, 158-59 (Tex.1989), cert. denied, 494 U.S. 1080, 110 S.Ct. 1809, 108 L.Ed.2d 939 (1990); Cain v. Bain, 709 S.W.2d 175, 176 (Tex.1986). So, considering the evidence, if a finding is so contrary to the great weight and preponderance of the evidence as to be manifestly unjust, the point should be sustained, regardless of whether there is some evidence to support it. Watson v. Prewitt, 159 Tex. 305, 305, 320 S.W.2d 815, 816 (1959); King's Estate, 244 S.W.2d at 661.

If evidence supports the implied findings of fact, we must uphold the trial court's judgment on any legal theory supported by the evidence. Worford, 801 S.W.2d at 109; Point Lookout West, Inc. v. Whorton, 742 S.W.2d 277, 278 (Tex.1987); Runnells, 746 S.W.2d at 848. This is so regardless of whether the trial court articulates the correct legal reason for the judgment. Harrington v. Railroad Comm'n, 375 S.W.2d 892, 895 (Tex.1964); Marifarms Oil & Gas, Inc. v. Westhoff, 802 S.W.2d 123, 125 (Tex.App.--Fort Worth 1991, no writ).

B. Exercising Personal Jurisdiction

For a Texas court to exercise personal jurisdiction over a nonresident, two conditions must be met: the Texas long-arm statute must authorize it and it must be consistent with the due process guarantees provided in our federal and state constitutions. Schlobohm v. Schapiro, 784 S.W.2d 355, 356 (Tex.1990); Nikolai, 922 S.W.2d at 233; see also U.S. C ONST. amend. XIV; T EX C ONST. art. I, § 19; T EX.CIV.PRAC. & REM.CODE A NN. § 17.042 (Vernon Supp.1997). Under the Texas long-arm statute, personal jurisdiction extends to nonresident defendants that either continuously and systematically "do business" in Texas or are parties to litigation arising from or related to "business" they conducted in Texas. O'Brien v. Lanpar Co., 399 S.W.2d 340, 342 (Tex.1966); Nikolai, 922 S.W.2d at 233. The Texas long-arm statute provides:

In addition to other acts that may constitute doing business, a nonresident does business in this state if the nonresident:

(1) contracts by mail or otherwise with a Texas resident and either party is to perform the contract in whole or in part in this state;

(2) commits a tort in whole or in part in this state; or

(3) recruits Texas residents, directly or through an intermediary located in this state, for employment inside or outside the state.

TEX.CIV.PRAC. & REM.CODE ANN. § 17.042 (Vernon Supp.1997).

The broad language of the Texas long-arm statute's "doing business" requirement has been construed to reach as far as the federal constitution allows. Guardian Royal Exch. Assurance Ltd. v. English China Clays, P.L.C., 815 S.W.2d 223, 226 (Tex.1991); Nikolai, 922 S.W.2d at 234.

A plaintiff must meet two...