McLendon v. McLendon
| Decision Date | 17 August 1993 |
| Docket Number | No. 05-92-00448-CV,05-92-00448-CV |
| Citation | 862 S.W.2d 662 |
| Parties | Gordon B. McLENDON, Jr., Individually and as Independent Co-Executor of the Estate of Jeannette Eyster McLendon, Appellant, v. Anna Gray McLENDON and Jan McLendon Moss, Appellees. |
| Court | Texas Court of Appeals |
Joseph O. Collins, Jr., Scott D. Weber, for appellant.
James L. Truitt, Thomas N. Crowell, James J. Hartnett, Jr., Jay D. Hartnett, John C. Biggers, Kenneth A. Herridge, for appellees.
Before BAKER, CHAPMAN and ROSENBERG, JJ.
In this probate case, Anna Gray McLendon Mandel and Jan McLendon Moss challenged the management of the Estate of Jeannette Eyster McLendon by its co-executors, Gordon B. McLendon, Jr. (Bart) and Billie Odom. We modify the trial court's judgment and affirm the judgment as modified.
B.R. McLendon and his wife Jeannette had a son, Gordon B. McLendon, Sr. Gordon had a son named Gordon B. McLendon, Jr., who went by the name of Bart. Gordon also had two daughters, named Anna and Jan. B.R. died in 1982, and Jeannette died in 1985. The probate court appointed Bart and Billie Odom 1 as Independent Co-executors of Jeannette's estate.
Gordon, B.R., and since 1969, Bart, built a highly successful enterprise concentrating in the acquisition and operation of radio stations throughout the United States and movie theaters, including "Drive-In" theaters, throughout Texas. The McLendons owned assets throughout the country and in some foreign countries. Gordon, B.R., Bart, and a cadre of trusted and loyal employees ran the closely held businesses.
Over the years, the McLendon holdings became concentrated in two entities, The McLendon Company, a Texas General Partnership, and Tri-State Theaters, a Texas Limited Partnership. Jeannette was a general partner in The McLendon Company and a limited partner in Tri-State. Bart and Gordon were the general partners of Tri-State.
B.R. died in 1982. The Tri-State Limited Partnership Agreement provided it would terminate upon Gordon's death. On May 30, 1985, Gordon and Jeannette amended the Agreement deleting the provision that it would terminate upon Gordon's death. The McLendon Company Partnership Agreement provided that the surviving partners had the right to continue the partnership with the successor in interest of the deceased partner.
On July 25, 1985, Jeannette died. On July 29, 1985, the probate court appointed Bart and Billie Odom as independent co-executors of her estate. When Jeannette died, Gordon owned a thirty percent interest in Tri-State as a general partner, and Bart owned a ten percent interest as a general partner. The limited partners of Tri-State were the Estate of B.R., owning thirty percent interest, and Jeannette, also owning thirty percent interest. When Jeannette died, she owned twenty-five and one-half percent general partnership interest in The McLendon Company. Anna and Jan each inherited twenty percent of Jeannette's estate.
On August 23, 1985, the partners amended the partnership agreements of both The McLendon Company and Tri-State Theaters. Gordon and Bart, as general partners of both partnerships, Bart and Billie, as co-executors of Jeannette's estate, and Dorothy Manning, as executrix of B.R.'s estate, signed the amendments. The partnership amendments are central to the controversy between Bart and Anna and Jan.
The McLendon Company Partnership Amendment provides:
Should any partner contest by legal action, judicial proceeding or otherwise any management decision or action made or taken by the managing partner [Bart] in his role as sole and exclusive manager of the partnership business, then the managing partner may, by written notice to such partner (the "Expulsion Notice"), expel such partner from the partnership, such expulsion and the termination of such partner's status as a partner in the partnership being effective as of the date of the Expulsion Notice. No such expulsion shall cause a dissolution and termination of the Partnership and, upon any such event, no one shall have the right to compel the termination and liquidation of the Partnership.
Upon expulsion, the expelled partner receives an amount equal to the book value of his or her partnership interest, payable by a ten-year installment note. The Tri-State Theatre amendment is similar to The McLendon Company amendment.
Anna 2 sued Bart and Billie challenging their management of Jeannette's estate. Anna also contested the validity of the amendments to the two partnership agreements. Bart and Billie notified Anna that she had forfeited her interest in Jeannette's estate. Bart and Billie filed a counterclaim seeking a ruling that Anna and Jan's lawsuit represented conduct contemplated by the in terrorem clause of Jeannette's will. The in terrorem clause reads:
In the event any individual contests this Will or otherwise attempts to attach, modify or impair the validity of the provisions hereof, I direct that if such individual be a beneficiary hereunder, his or her sole inheritance from my estate shall be One Dollar ($1.00).
Anna and Jan asserted causes of action against Bart and Billie for: (1) breach of fiduciary duty; (2) removal of the Co-Executors; (3) fraud; (4) tortious interference with inheritance rights; (5) intentional infliction of emotional distress; (6) punitive damages; (7) attorneys' fees; and (8) an accounting and distribution. Anna and Jan also sought declaratory judgment that the partnership amendments were invalid based on a breach of fiduciary duty and void as against public policy. They sought a ruling that Gordon was incompetent and subject to undue influence by Bart at the time of the execution of the amendments. They sought a ruling that The McLendon Company terminated upon Jeannette's death and the in terrorem clause in Jeannette's will was invalid or did not apply to appellees' claims.
The jury found that Bart and Billie breached their fiduciary duties to the estate. The jury awarded actual damages of $100,000 for Anna and Jan against Bart. The jury awarded punitive damages of $100,000 for Anna and Jan against Bart. The jury awarded Anna $700,000 and Jan $358,000 as reasonable and necessary attorneys' fees. The trial court entered judgment on the verdict for Anna and Jan. The trial court, based on the Declaratory Judgments Act, awarded Anna and Jan their attorneys' fees. However, the trial court did not enter judgment for Anna and Jan that the in terrorem clause in Jeannette's will did not apply to their suit against Bart.
In eight points of error, Bart asserts the trial court erred in awarding actual damages, exemplary damages, and attorneys' fees. Bart further complains this Court erred in granting Anna's motion for extension of time to perfect her appeal.
In six cross-points of error, Anna and Jan complain the trial court erred by: (1) refusing to hold the partnership amendments invalid; (2) refusing to submit a jury question on whether the co-executors acted fairly by executing the amendments; (3) refusing to remove the co-executors on appellees' request and because the jury's answer was against the great weight and preponderance of evidence; (4) failing to submit a jury question on the co-executors' legal incapacity; and (5) failing to declare the in terrorem clause did not apply.
In point of error eight, Bart asserts this Court erred in granting Anna's 3 motion for extension of time to file the cost bond. Bart claims our order allows her to appeal as to Billie Odom without showing good cause. Anna and Jan argue that: (1) Bart did not appropriately raise the point in his brief; (2) Bart waived the point; (3) this Court's order is not erroneous; and (4) the point is moot.
Where a party files a timely motion for new trial, an appellant perfects an appeal by filing a cost bond or substitute within ninety days of the date on which the trial court signed the final judgment. TEX.R.APP.P. 41(a)(1). This Court may extend the appellate timetable under certain circumstances. Rule 41(a)(2) of the Texas Rules of Appellate Procedure provides:
An extension of time may be granted by the appellate court for late filing of a cost bond or notice of appeal or making the deposit required by paragraph (a)(1) or for filing the affidavit, if such bond or notice of appeal is filed, deposit is made, or affidavit is filed not later than fifteen days after the last day allowed and, within the same period, a motion is filed in the appellate court reasonably explaining the need for such extension. If a contest to an affidavit in lieu of bond is sustained, the time for filing the bond is extended until ten days after the contest is sustained unless the trial court finds and recites that the affidavit is not filed in good faith.
TEX.R.APP.P. 41(a)(2) (emphasis added).
The issue is what is a "reasonable explanation?" The Texas Supreme Court defines "reasonably explaining" to mean "any plausible statement of circumstances indicating that failure to file within the [required] period was not deliberate or intentional, but was the result of inadvertence, mistake or mischance." See Garcia v. Kastner Farms, Inc., 774 S.W.2d 668, 669 (Tex.1989) (quoting Meshwert v. Meshwert, 549 S.W.2d 383, 384 (Tex.1977)). Any conduct short of deliberate or intentional noncompliance qualifies as inadvertence, mistake or mischance even if that conduct is professional negligence. Garcia, 774 S.W.2d at 670.
Our ruling on the motion before submission on the merits is an interlocutory order. Smith v. Free, 130 Tex. 23, 107 S.W.2d 588, 589-90 (1937); Taylor v. Trans-Continental Properties, Ltd., 739 S.W.2d 873, 874 (Tex.App.--Tyler 1987, no writ). As such, the complaining party can incorporate the ruling on the motion in a motion for rehearing filed in this Court or assign it as error in the appellate brief. Failure to do either waives the...
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