Mustang Amusements, Inc. v. Sinclair, No. 10-07-00362-CV (Tex. App. 10/28/2009)

• Court: Texas Court of Appeals
• Writing for the Court: Tom Gray
• Decision Date: 28 October 2009
• Docket Number: No. 10-07-00362-CV.,10-07-00362-CV.
• Citation: Mustang Amusements, Inc. v. Sinclair, No. 10-07-00362-CV (Tex. App. 10/28/2009), No. 10-07-00362-CV. (Tex. App. Oct 28, 2009)
• Parties: MUSTANG AMUSEMENTS, INC. AND MARSHA McKIE, INDIVIDUALLY AND AS EXECUTRIX OF THE ESTATE OF WILLIAM J. McKIE, DECEASED, Appellants, v. THOMAS H. SINCLAIR, Appellee.

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MUSTANG AMUSEMENTS, INC. AND MARSHA McKIE, INDIVIDUALLY AND AS EXECUTRIX OF THE ESTATE OF WILLIAM J. McKIE, DECEASED, Appellants, v. THOMAS H. SINCLAIR, Appellee.

No. 10-07-00362-CV.

Court of Appeals of Texas, Tenth District, Waco.

Opinion delivered and filed October 28, 2009.

Appeal from the 13th District Court, Navarro County, Texas, Trial Court No. 05-00-14658-CV.

Affirmed in part/Reversed and rendered in part.

Before Chief Justice GRAY, Justice REYNA, and, Justice DAVIS.

MEMORANDUM OPINION

TOM GRAY, Chief Justice.

Mustang Amusements, Inc. and Marsha McKie, Individually, and as Executrix of the Estate of William J. McKie, Deceased (collectively Mustang), appeal the decision of the trial court awarding specific performance to Thomas H. Sinclair by ordering the conveyance of real estate pursuant to a contract for sale of the land encompassing the town of Mustang, Texas. Mustang challenges the trial court's ruling due to Sinclair's failure to tender the purchase price on the date originally scheduled for closing, the failure of Sinclair to prove he was ready, willing, and able to complete the transaction at closing, and Sinclair's unclean hands. Mustang also appeals the trial court's equitable offsets of the amounts of rent that Sinclair had paid to Mustang during the pendency of the suit and the amount of lost rentals, the failure to find an accord and satisfaction, the failure to find the contract ambiguous, an award of damages for tortious interference with business relations, an award against Marsha McKie individually for a wrongful injunction, the denial of a judgment for rent not paid to Mustang by Sinclair, and the granting to Sinclair and the denial to Mustang of attorney's fees.

Trial was held before the court and the trial court made findings of fact and conclusions of law. In addition to the award of specific performance, the trial court allowed offsets to the purchase price of the land for rents Sinclair had paid to Mustang, for lost rental income from a trailer park on the property, for the wrongful injunction filed against Sinclair by Marsha McKie, for tortious interference with business relations, and for attorney's fees. Because we find the evidence legally insufficient to support an award for tortious interference with business relations, we reverse that portion of the judgment and render that Sinclair take nothing on that cause of action. We find the trial court did not abuse its discretion in the equitable awards and that the evidence is legally and factually sufficient in all other respects. We affirm the judgment in part and reverse and render in part.

Background

The undisputed facts are as follows. The town of Mustang, Texas is comprised of approximately 75 acres of land and was established by the owner of the land, Mustang Amusements, Inc. Mustang Amusements, Inc. was operated and owned primarily by William J. (Bill) McKie until his death. Bill McKie was a well-known attorney in Navarro County. Mustang, Texas had a country and western bar, a nude cabaret, and a trailer park where the residents of Mustang lived. Sinclair originally took over the management of the country and western bar from Eric Carter, which included the use of his liquor license, in September of 2004. At that time, Carter had a lease to operate the premises from Mustang Amusements, Inc.

Sinclair and Bill McKie entered into a lease agreement for Sinclair to lease both the cabaret and the country and western bar on December 15, 2004. Bill McKie and Carter had a dispute regarding ownership of furnishings and fixtures Carter had in the country and western bar. This ultimately resulted in Carter recording two liens against the property. Sinclair continued his operation of the clubs. In the spring of 2005, Sinclair and McKie negotiated the purchase of the entire property of the town of Mustang for $600,000.

Bill McKie and his wife, Marsha McKie, prepared and signed the contract for sale of the property on behalf of Mustang, which Sinclair signed on June 1, 2005. Marsha McKie was listed as the seller's broker. Sinclair deposited the earnest money with David Wilson, McKie's attorney. The contract contained a special provision that "Buyer is aware of liens placed on the property by Eric Carter." The contract also contained a boilerplate "time is of the essence" provision and established the closing date of July 1, 2005. The contract also required the seller to furnish a title commitment to Sinclair within thirty days of the contract, at which time Sinclair could object. The seller was further required to convey, at closing, "good and indefeasible title to the Property and show no exceptions . . . Seller must convey the Property at closing: . . . with no liens, assessments, or Uniform Commercial Code or other security interests against the Property which will not be satisfied out of the sales price . . . ." The seller would also be responsible to pay the cost at or before closing for releases of existing liens, other than any liens assumed by the buyer.

The property did not close on July 1, 2005. Sinclair sent a letter demanding performance on August 3, 2005. Bill McKie, through his attorney, David Wilson, filed suit against Eric Carter on August 22, 2005 to remove the liens from the property. Sinclair filed suit against Bill McKie and Mustang on October 18, 2005. On October 19, 2005, Marsha McKie became the representative of Mustang Amusements, Inc. Bill McKie died from pancreatic cancer on November 11, 2005. Marsha McKie was also named the executrix of Bill McKie's estate. We will further discuss the disputed facts in each issue as necessary to the disposition of this appeal.

Standards of Review

Because the same standards of review apply to multiple issues, we discuss in this section the various standards of review to be applied later in this opinion.

Abuse of Discretion

Specific performance is an equitable remedy committed to the trial court's discretion. Stafford v. S. Vanity Magazine, Inc., 231 S.W.3d 530, 535 (Tex. App.-Dallas 2007, pet. denied). The test for an abuse of discretion is not whether, in the opinion of the reviewing court, the facts present an appropriate case for the trial court's action, but "whether the court acted without reference to any guiding rules and principles." Cire v. Cummings, 134 S.W.3d 835, 838-39 (Tex. 2004) (citing Downer v. Aquamarine Operators, Inc., 701 S.W.2d 238, 241-42 (Tex. 1985)). The trial court's ruling should be reversed only if it was arbitrary or unreasonable. Cire, 134 S.W.3d at 839.

Legal and Factual Sufficiency

A legal sufficiency challenge requires consideration of "whether the evidence at trial would enable reasonable and fair-minded people to reach the verdict under review." City of Keller v. Wilson, 168 S.W.3d 802, 827 (Tex. 2005). We "must credit favorable evidence if reasonable jurors could, and disregard contrary evidence unless reasonable jurors could not." Id.

In a challenge to the legal sufficiency of the evidence regarding an issue on which the appellant did not have the burden of proof, we "view the evidence in the light favorable to the verdict, crediting favorable evidence if reasonable jurors could, and disregarding contrary evidence unless reasonable jurors could not." City of Keller v. Wilson, 168 S.W.3d 802, 807 (Tex. 2005). We will sustain a no evidence challenge if: (a) there is a complete absence of evidence of a vital fact, (b) the court is barred by rules of law or of evidence from giving weight to the only evidence offered to prove a vital fact, (c) the evidence offered to prove a vital fact is no more than a mere scintilla, or (d) the evidence conclusively establishes the opposite of the vital fact. Merrell Dow Pharms. v. Havner, 953 S.W.2d 706, 711 (Tex. 1997).

When the party that had the burden of proof at trial complains on appeal of the legal insufficiency of an adverse finding, that party must demonstrate that the evidence establishes conclusively, i.e., as a matter of law, all vital facts in support of the finding sought. Dow Chem. Co. v. Francis, 46 S.W.3d 237, 241 (Tex. 2001). We first search the record for evidence favorable to the adverse finding, disregarding all contrary evidence unless a reasonable factfinder could not. City of Keller v. Wilson, 168 S.W.3d 802, 822, 827 (Tex. 2005). If we find no evidence supporting the finding, we then determine whether the contrary was established as a matter of law. Id.

A factual sufficiency challenge to issues on which the appellant did not bear the burden of proof requires us to "consider and weigh all of the evidence." Checker Bag Co. v. Washington, 27 S.W.3d 625, 633 (Tex. App.-Waco 2000, pet. denied). We may not pass upon the witnesses' credibility or substitute our judgment for that of the factfinder, even if the evidence would clearly support a different result. See Checker Bag, 27 S.W.3d at 633. We will reverse the "verdict only if it is so contrary to the overwhelming weight of the evidence that the verdict is clearly wrong and unjust." Id. Reversal can occur because the finding was based on weak or insufficient evidence or because the proponent's proof, although adequate if taken alone, is overwhelmed by the opponent's contrary proof. Id.

When a party attacks the factual sufficiency of an adverse finding on an issue on which it carried the burden of proof at trial, that party must demonstrate on appeal that the "adverse finding is against the great weight and preponderance of the evidence." Dow Chem. Co. v. Francis, 46 S.W.3d 237, 242 (Tex. 2001) (per curiam) (citing Croucher v. Croucher, 660 S.W.2d 55, 58 (Tex. 1983).

Findings of Fact and Conclusions of Law

When a trial court issues findings of fact and conclusions of law following a bench trial, we review the findings and conclusions under the same standards that we apply in reviewing jury findings. Anderson v. City of Seven Points, 806 S.W.2d 791, 794 (Tex. 1991). We review the trial court's conclusions...