Manzo v. Ford

• Decision Date: 07 May 1987
• Docket Number: No. C14-86-546-CV,C14-86-546-CV
• Parties: Bartolomeo MANZO and Wife, Beverly Manzo, Appellants, v. Jane FORD, John Ventura and Ford Management Company, Appellees. (14th Dist.)
• Court: Texas Court of Appeals

Page 673

731 S.W.2d 673

Bartolomeo MANZO and Wife, Beverly Manzo, Appellants, v. Jane FORD, John Ventura and Ford Management Company, Appellees.

No. C14-86-546-CV.

Court of Appeals of Texas Houston (14th Dist.).

May 7, 1987.

Gerald J. Goodwin and Daniel L. Burkeen, Houston, for appellants.

Russell C. Ducoff, Houston, for appellees.

Before JUNELL, SEARS and DRAUGHN, JJ.

OPINION

SEARS, Justice.

This is an appeal from a take-nothing summary judgment granted in Appellants' suit for breach of contract. We hold that the trial court erred in finding that: (1) the provisions of the contract barred Appellants from pursuing a cause of action based on breach of contract, and (2) that there was no material fact issue as to Appellees' liability. We reverse the judgment of the trial court and remand the cause for trial.

On March 25, 1979, Appellants, residents of California, purchased an apartment complex in Houston, Texas, known as the High Chapparal Apartments. Appellees Jane Ford and John Ventura acted as the listing agents of this property and also acted as attorneys for Appellants. On June 1, 1979 Appellants entered into a contract drafted by Appellees which provided that Appellees were to manage, operate and lease the apartment complex for Appellants. Subsequently, Appellants discovered that false representations had been made by Appellees Jane Ford and John Ventura in connection with the purchase of the property and that Appellees were not performing the services promised in the management and leasing agreement.

Appellants brought suit against Appellees on April 29, 1983, alleging breach of fiduciary duty, negligence, misrepresentation, fraud in the inducement, civil conspiracy, breach of express warranty, breach of implied warranty and breach of contract. Appellees filed a Plea in Bar alleging that the actions for breach of fiduciary duty and fraud which occurred prior to April 28, 1979, were barred by the statute of limitations. The trial court entered an order barring all causes of action for negligence, fraud, misrepresentation, fraud in the inducement, civil conspiracy and breach of fiduciary duty. Appellants' Motion for Reconsideration of the Plea in Bar was denied and the remaining breach of contract cause of action was consolidated with another action, Bartolomeo Manzo and Wife, Beverly Manzo v. Dale E. Angeli, Ind., et. al., in the 133rd District Court. On December 12, 1985, the trial court granted Appellees' Motion for Summary Judgment on Appellants' breach of contract claim and severed the cause of action against Appellees thus allowing the summary judgment to become final.

Appellants assert two points of error. In point of error one, Appellants contend that the trial court erred in granting the motion for summary judgment because the statute of limitations had not expired on the breach of contract claim. They maintain that the management and leasing agreement does not limit them to causes of action for fraud, negligence or intentional malfeasance thereby barring them from asserting a claim based on breach of contract. They contend their claim is governed by the four year statute of limitations and that suit was timely filed.

The trial court granted summary judgment on the premise that Article X of the management agreement limited Appellants' causes of action to fraud, negligence and intentional malfeasance, and that these actions were barred by the two year statute of limitations. The court further found that the contract excluded all other causes of action.

Article X, of the contract in question, reads as follows:

Liability of Manager. The Manager shall not be responsible to the Owner for any loss which may occur by reason of depreciation in the value of the Project, or any other loss or damage which may occur to the Owner, except that the Manager shall be liable to the Owner for fraud, negligence or intentional malfeasance in the management of the Project by the Manager or any of its employees or agents. The owner agrees to indemnify the Manager and to hold it harmless from all liability, claims, damages, losses and judgments arising out of any damage or injury to persons or property by reason of any cause whatsoever in or about the Project, or arising in any other manner in connection with the operation of the Project, except for liability, claims, damages, losses or judgments resulting from the fraud, negligence or intentional malfeasance of the Manager or any of its employees or agents.

When parties to a contract disagree as to the meaning of a particular provision, we cannot look solely to the disputed paragraph, clause or provision to ascertain its meaning. Each and every part of the contract must be considered with every other part so that the effect or meaning of one part on any other part may be determined. Smart v. Tower Land and Inv. Co., 597 S.W.2d 333, 337 (Tex.1980); Citizens National Bank in Abilene v. Texas & P. Ry. Co., 136 Tex. 333, 150 S.W.2d 1003, 1006 (1941), cert. denied, 314 U.S. 656, 62 S.Ct. 109, 86 L.Ed. 526 (1941).

The management and leasing agreement contains numerous provisions detailing the responsibilities and duties of Appellees. Article VIII of the agreement defines what constitutes a default of the agreement and provides the remedies available to each party in the event of such a breach. Section 8.01 entitled "Default by Manager" reads in pertinent part as follows:

Any of the following events shall constitute defaults by Manager under this Agreement:

....

(b) Manager shall fail to keep, observe or perform any covenant, agreement, term or provision of this Agreement to be kept, observed or performed by Manager....

Section 8.02, "Remedies of Owner," then provides:

Upon the occurrence of an event of default by Manager as specified in Section 8.01 hereof, Owner shall be entitled to terminate this Agreement, and upon any such termination Owner shall have the right to pursue any remedy it may have at law or in equity, it being expressly understood that although Owner shall have no further obligation to pay any fee due hereunder, Manager shall remain liable for any losses suffered as a result of Manager's default and the resulting termination of this Agreement. Upon such termination, Manager shall deliver to Owner any funds, books and records of Owner then in the possession or control of Manager. (Emphasis added).

Article VIII gives Appellant the right to pursue any remedy at law or in equity and explicitly recognizes that Appellees are liable for any losses suffered as a result of their breach of the agreement. However, Article X purports to restrict Appellants to causes of action for negligence, fraud and intentional malfeasance and to absolve Appellees from...