Padre Island Inv. Corp. v. Sorbera

• Court: Texas Court of Appeals
• Writing for the Court: BUTTS
• Citation: Padre Island Inv. Corp. v. Sorbera, 677 S.W.2d 90 (Tex. App. 1984)
• Decision Date: 27 June 1984
• Docket Number: No. 04-83-00199-CV,04-83-00199-CV
• Parties: PADRE ISLAND INVESTMENT CORP., Appellant, v. Salvatore SORBERA & Joyce Sorbera, Appellees.

Page 90

677 S.W.2d 90

PADRE ISLAND INVESTMENT CORP., Appellant, v. Salvatore SORBERA & Joyce Sorbera, Appellees.

No. 04-83-00199-CV.

Court of Appeals of Texas San Antonio.

June 27, 1984.

Rehearing Denied Aug. 16, 1984.

Gary Norton, Gary, Thomasson, Hall & Marks, Corpus Christi, for appellant.

E.S. Prashner, Ertel & Prashner, San Antonio, for appellees.

Before BUTTS, REEVES and TIJERINA, JJ.

OPINION

BUTTS, Justice.

This is a venue case governed by the Texas Deceptive Trade Practices Act, TEX.BUS. & COM.CODE ANN. § 17.41 et seq. (Vernon Supp.1984). ¹ Plaintiffs Salvatore and Joyce Sorbera sued Padre Island Investment Corporation for breach of contract and breach of warranty, instituting suit in Bexar County. Padre Island filed its plea of privilege, requesting transfer of the case to Nueces County, the corporation's place of residence. Plaintiffs asserted by controverting plea that venue is proper in Bexar County under § 17.56. The trial court agreed and overruled the plea of privilege. We affirm.

The transaction at issue involves a series of events occurring both before and after the effective date of the DTPA (May 21, 1973). Before December 27, 1972, a purported agent of defendant (a retired colonel) solicited plaintiffs by telephone to attend a presentation in San Antonio concerning the purchase of undeveloped real property in North Padre Island from Padre Island Investment Corporation. After the presentation, plaintiffs made a check payable to Padre Island for $100.00, indicating their good faith interest in purchasing property in North Padre Island. When they visited Corpus Christi to view the property, they received back their very same $100.00 good faith deposit check unnegotiated.

Plaintiffs purchased three lots from the corporation. Padre Island in 1977 returned the money on one lot, but the other two are still owned by plaintiffs. On January 8, 1973, and on July 10, 1973, defendant corporation signed contracts in Nueces County, previously signed by plaintiffs, which promised, among other things, to ready the lots for home construction by November 1981. Salvatore Sorbera testified that he visited Corpus Christi three or four times a year subsequent to the signing of the contract until defendants failed to perform as promised in November 1981 and was reassured each time by agents of Padre Island that the lots would be completed on schedule as promised.

We note that breach of contract damages and damages for breach of express warranty under the DTPA are not mutually exclusive. Smith v. Baldwin, 611 S.W.2d 611, 614 (Tex.1980). Plaintiffs could sue for breach of contract and could also sue for misrepresentations as to the date the lot would be ready for house construction, provided they received but one recovery for the same act or practice. § 17.43. Cf. Garcia v. Texas Instruments, Inc., 610 S.W.2d 456 (Tex.1980); Continental Savings Association v. Maheney, 641 S.W.2d 290, 292 (Tex.App.--Houston [14th Dist.] 1982, writ ref'd n.r.e.).

Padre Island raises three points of error. In points of error one and two, it argues that since the events of which plaintiffs complain occurred in Bexar County before the DTPA became applicable to real property, venue is not proper in Bexar County. In point of error three, the corporation complains that the evidence is factually and legally insufficient to support a finding that the solicitations for the sale of real property were made by an authorized agent of Padre Island in Bexar County.

In order to resolve points of error one and two, we first must decide when the acts giving rise to the cause of action occurred, thereby enabling us to determine which DTPA venue statute ² applies and, thus, where venue properly lies.

Although it is uncontested that the solicitations precipitating the series of events of which plaintiffs complain occurred prior to the effective date of the DTPA, the date of the deceptive acts or practices giving rise to the cause of action under the DTPA determines the applicability of the Act. La Sara Grain Co. v. First National Bank of Mercedes, Texas, 673 S.W.2d 558, 565 (Tex.1984); Woods v. Littleton, 554 S.W.2d 662, 665-66 (Tex.1977). 27 P. KENS and S. COCHRAN, CONSUMER RIGHTS AND REMEDIES § 2 (Texas Practice 1983).

The pertinent parts of plaintiffs' original petition are:

At some time prior to December 27, 1972, Defendant solicited Plaintiffs by telephone to attend a presentation in San Antonio, Bexar County, Texas. During such presentation, the sum of $100.00 was solicited by Defendant from Plaintiffs as a good faith deposit, which deposit was paid by Plaintiffs in San Antonio, Bexar County, Texas, to Defendant, prior to Plaintiffs visiting the real estate development belonging to Defendant. Plaintiffs then purchased from Defendant two (2) pieces of real property, the first being Lot 70, Block 001, Cape Summer Unit 1, in Nueces County, Texas, and were furnished and executed a Contract for Deed therefor, a copy of which is attached hereto and marked Plaintiffs' Exhibit "A" and incorporated herein by reference, and Lot 32, Block 21, Cape Summer Unit 1 in Nueces County, Texas, and were furnished and executed a Contract for Deed therefor, copy of which is attached hereto and marked Plaintiffs' Exhibit "B" and incorporated herein by reference.

III.

Said contracts provide in relevant part that by November, 1981, "there shall have been constructed and installed paved streets, and, if applicable, concrete bulk hill heading of canals, abutting said property; and there shall have been made available to buyer a water main and sewage disposal facility abutting said property that buyer may, at his expense, tap into said water main, and into a sewage disposal facility and procure water service and sewage disposal service for said property." In addition, Defendant made various other representations which constituted warranties contained in the contracts referred to above, some or all of which were breached by Defendant. In addition, said contracts provide for an exchange privilege which Defendant has failed and refused to comply with. (Emphasis added.)

We perceive the acts giving rise to this cause of action to be the misrepresentations of the defendant in the form of continued reassurances to the plaintiffs that their land would be ready. Plaintiffs could not know before November 1981 the statements made by Padre Island were misrepresentations although such reassurances occurred over a period of time beginning prior to the effective date of the DTPA (May 21, 1973) until the actual breach. Woods, supra at 665-66; Town & Country Mobile Homes, Inc. v. Stiles, 543 S.W.2d 664, 666 (Tex.Civ.App.--El Paso 1976, no writ).

It is well established that breach of an express warranty occurs when defects are discovered. Ralston Oil & Gas v. Gensco, 706 F.2d 685, 695 (5th Cir.1983); Town & Country Mobile Homes, Inc. v. Stiles, 543 S.W.2d 664, 666 (Tex.Civ.App.--El Paso 1976, no writ). The defects in this case (the failure of defendant to ready the lots for home construction) could not have been discovered until defendant failed to perform as scheduled (November 1981).

Good practice may indicate that plaintiffs should have plead the particular subdivision of the Act upon which they relied. However, that is not necessary. See U.S. Steel Corp. v. Fiberglass Specialties, 638 S.W.2d 950, 955 (Tex.App.--Tyler 1982, no writ). Padre Island excepted to plaintiffs' failure to state the amount of damages but did not specially except to plaintiffs' lack of particularity concerning the events or acts relied upon as a basis for liability under the DTPA. In Johnson v. Willis, 596 S.W.2d 256, 260 (Tex.Civ.App.--Waco 1980, writ ref'd n.r.e.), that defendant specially excepted to the vagueness in plaintiff's pleadings, and the appellate court agreed these special exceptions should have been granted. On the other hand, in the case at bar where the defendant did not specially except to omissions in the petition or in plaintiffs' controverting affidavit, we will construe each one liberally in favor of plaintiff. U.S. Steel Corp., supra at 955. 1 R. McDONALD, TEXAS CIVIL PRACTICE, § 4.49 (rev. 1981).

By liberally construing plaintiff's petition, we find plaintiff has sufficiently alleged a cause of action under § 17.50(a)(2), the breach of warranty that certain improvements would be made. The acts giving rise to the cause of action were continuing misrepresentations in the form of reassurances occurring until the November, 1981 breach. See Town & Country, supra at 666. The applicable venue statute is therefore the 1979 venue statute. ³

Padre Island relies on Ferguson v. Beal, 588 S.W.2d 651 (Tex.Civ.App.--Houston [14th Dist.] 1979, writ ref'd n.r.e.) and argues the DTPA does not apply in this case since that Act did not include real property transactions until September 1975. Unlike the Ferguson facts, in this case plaintiffs executed the contracts of sale, relying upon Padre Island to make many improvements to the land, and the price encompassed those improvements. ⁴ The services to be performed by Padre Island on the land included construction and placement of streets, utility mains and equipment, sewage disposal, and other seaside resort amenities. Without the promised construction and placement of the items plaintiffs were in no position to build. Points of error one and two are overruled.

The 1979 venue statute sets out two requirements, the first that plaintiffs must allege a cause of action under § 17.50. ABC Truck Rental & Leasing v. Southern County Mutual Insurance Co., 662 S.W.2d 132, 135 (Tex.App.--San Antonio 1983, no writ); Ferrara v. Corinth Joint Venture, 611 S.W.2d 669, 670 (Tex.Civ.App.--Eastland 1980, no writ); T.P. Walsh Co. v. Manning, 609 S.W.2d 636, 638-39 (Tex.Civ.App.--Tyler 1980, no writ). We have already found that plaintiffs adequately plead a cause of action under § 17.50(a)(2).

The second requirement consists of a description of five...