Milam Development Corporation v. Wurzbach Tower Council of

• Decision Date: 28 March 1990
• Docket Number: No. 04-87-00575-CV,CO-OWNER,INC,04-87-00575-CV
• Citation: 789 S.W.2d 942
• Parties: Page 942 789 S.W.2d 942 MILAM DEVELOPMENT CORPORATION, Appellant, v. 7*7*0* 1 WURZBACH TOWER COUNCIL OF, Appellee. Court of Appeals of Texas, San Antonio
• Court: Texas Court of Appeals

Page 942

789 S.W.2d 942

MILAM DEVELOPMENT CORPORATION, Appellant v 7*7*0* 1 WURZBACH TOWER COUNCIL OF CO-OWNERS, INC., Appellee.

No. 04-87-00575-CV.

Court of Appeals of Texas San Antonio.

March 28, 1990.

Rehearing Denied May 24, 1990.

Jerry N. Dennard, San Antonio, for appellant.

Mitchell L. Weidenbach, Charles Estee, Shannon & Weidenbach, San Antonio, for appellee.

Before CADENA, C.J., and REEVES and CHAPA, JJ.

OPINION

CADENA, Chief Justice.

Plaintiff, Milam Development Corporation, sued 7*7*0 Wurzbach Tower Council of Co-Owners, Inc. (Council), a condominium association formerly known as Milam Towers South Council of Co-Owners, Inc., for breach of a sub-lease agreement involving television satellite equipment. Plaintiff alleged that Council violated the sub-lease by failing to return certain property when the sub-lease was terminated. The property in question is the coaxial cable installed in the condominiums during construction and a new satellite system purchased and installed after the original equipment was removed. Council filed a counterclaim based on alleged violations of the Texas Deceptive Trade Practices Act (DTPA). A jury returned a verdict favorable to Milam on its claim against Council and returned an unfavorable verdict to Council on its DTPA claim. The trial court entered a judgment non obstante veredicto that Milam take nothing and awarded Council its costs and attorney's fees. We affirm this judgment.

Plaintiff was the developer of a condominium structure in San Antonio. In February, 1982, while the project was under construction, plaintiff contracted with Corpus Christi Systems, Inc., to install a television satellite system in the building. The system consisted of three parts: the satellite receiving equipment, or dish; MATV Head End, which amplifies the signal and converts it to television channel designations; and a distribution system consisting of a coaxial cable, junction boxes and outlets in each condominium unit. The system was installed and construction of the project was completed in September, 1982.

In October, 1982, plaintiff sold the satellite system to Chase Investment Company (Chase) which in turn leased it back to plaintiff. In March, 1983, S.A.T. Investments assumed ownership and possession of the condominium project.

On March 4, 1983, after S.A.T. had taken title to the condominium project, defendant sub-leased from plaintiff the satellite equipment covered in the lease from Chase to plaintiff. With minor irrelevant exceptions, the sub-lease incorporated the Chase-plaintiff lease in its entirety, and also provided that defendant could terminate the sub-lease by giving 60 days written notice to plaintiff.

In 1984 defendant replaced the satellite dish and MATV Head End with new equipment which was connected to the coaxial cable that had originally been installed during construction of the building. Council claimed that this replacement was necessary because of the continual reception problems resulting from use of the original dish and MATV Head End. Plaintiff insisted that during the latter part of 1983 defendant's actions resulted in extensive water damage to the system during the renovation of the condominium project after its transfer to S.A.T. Plaintiff also claimed that the problems resulted from the fact that defendant, contrary to the provisions of the sub-lease, moved the dish from its original location on a concrete pad on the ground to the top of a new parking garage built next to the condominium building.

On October 17, 1984, Council gave plaintiff written notice that it was terminating the sub-lease in 60 days because the original equipment did not perform satisfactorily. Several offers by Council to return the original dish and MATV Head End were rejected by plaintiff, who claimed that the newly installed equipment was an "addition or improvement" to the system which, under the terms of the sub-lease, belonged to plaintiff. Plaintiff also claimed that the coaxial cable which had been installed in the building was part of the leased equipment and demanded delivery of the cable and the newly-installed equipment. Council denied plaintiff's demands.

The jury found that the coaxial cable was part of the equipment subject to the lease and that Council failed to deliver to plaintiff all improvements and additions made to the system. The verdict contained findings as to the value of the cable and such additions and improvements.

We must uphold the judgment non obstante veredicto unless after viewing the evidence in the light most favorable to the verdict, we determine that there is more than a scintilla of evidence which supports the jury's findings. Miller v. Bock Laundry Machine Co., 568 S.W.2d 648, 649-50 (Tex.1977).

Plaintiff is mistaken in its assertion that the coaxial cable originally installed in the condominium building is part of the equipment sub-leased to Council. Since the sub-lease incorporates the lease from Chase to plaintiff, we agree with plaintiff that we must construe the original lease which consists of two pages of the lease proper and an attached document entitled "Exhibit A," that contains a list of the equipment leased. The list of "Equipment Leased" which is found in Exhibit A does not include the coaxial cable. Since it is undisputed that Exhibit A is a part of the original lease which is incorporated in the sub-lease, we must conclude that it is a part of the sub-lease from plaintiff to Council. The original lease and sub-lease, therefore, establish that the coaxial cable is not a part of the leased equipment.

Plaintiff contends that four documents which were stapled to the original lease at the time it was executed must be considered a part of that instrument and a part of the sub-lease. Kenneth Milam, plaintiff's president, testified that these documents were part of the original lease with Chase. One of the documents contains an "EQUIPMENT LIST" and a list of "Local Origination Equipment" on the stationary of Corpus Christi Systems, the company which originally installed the system in the building. The equipment listed in the "EQUIPMENT LIST" found in this document is identical to that listed in Exhibit A, except that it includes an "equipment rack." The list of "Local Origination Equipment" includes the coaxial cable.

Plaintiff contends that the lease is ambiguous because the "Local Origination Equipment" list includes the coaxial cable, while Exhibit A does not. Because of this alleged ambiguity, plaintiff argues that the testimony of its president concerning the equipment which was included in the lease was properly admitted.

Unlike Exhibit A, which is referred to in the body of the lease and is initialled by the parties, the document with the "EQUIPMENT LIST" AND "Local Origination Equipment" is not signed, referred to in the lease, or mentioned as an exhibit to the lease. Since such a document cannot be considered a part of the lease, plaintiff cannot rely on it for the purpose of creating the ambiguity necessary to permit the admission of parol testimony to explain such ambiguity. We also reject plaintiff's contention which relies on the rule that separate instruments executed at the same time and for the same purpose in the course of the same transaction, should be considered together and construed as one contract. See Jones v. Kelley, 614 S.W.2d 95, 98 (Tex...