Solar Soccer Club v. Prince of Peace

• Decision Date: 19 September 2007
• Docket Number: No. 05-06-00130-CV.,05-06-00130-CV.
• Parties: SOLAR SOCCER CLUB, Appellant and Cross-Appellee v. PRINCE OF PEACE LUTHERAN CHURCH OF CARROLLTON, Texas, Appellee and Cross-Appellant.
• Court: Texas Court of Appeals

234 S.W.3d 814

SOLAR SOCCER CLUB, Appellant and Cross-Appellee v. PRINCE OF PEACE LUTHERAN CHURCH OF CARROLLTON, Texas, Appellee and Cross-Appellant.

No. 05-06-00130-CV.

Court of Appeals of Texas, Dallas.

September 19, 2007.

Michael K. Haines, Haines & Associates, P.C., James Holmes, Dallas, Douglas W. Alexander, Dana Livingston Cobb, Alexander, Dubose, Jones & Townsend, LLP, Austin, for Appellant.

Before Justices WHITTINGTON, FRANCIS, and LANG.

OPINION

Opinion By Justice WHITTINGTON.

In this intractable dispute, Prince of Peace Lutheran Church of Carrollton, Texas, seeks to terminate a contractual relationship with Solar Soccer Club. Solar, on the other hand, seeks to continue the relationship for the full contractual term. After several summary judgments and a jury trial, the parties continue to pursue their opposing goals in this appeal and cross-appeal. The trial judge entered judgment on the jury's verdict, terminating the contract but awarding damages to Solar. We affirm the trial court's judgment in part and reverse in part. We conclude summary judgment for Prince of Peace on its claim for breach of the field maintenance provision of the lease was improper. We render judgment that Solar cannot recover on its claim in quantum meruit. We remand for further proceedings the issues of whether Solar breached the field maintenance provision of the lease and the amount of Prince of Peace's attorney's fees. In all other respects, we affirm the trial court's judgment.

BACKGROUND

In 1999, Solar and Prince of Peace entered into a lease agreement. Solar agreed to build soccer fields on Prince of Peace's undeveloped property. The parties agreed Solar would use the fields primarily on evenings and weekends, while Prince of Peace would use the fields during the school day for the students in its school. Because the construction of the fields was at Solar's expense, and the fields, thereafter, would belong to Prince of Peace, there were no periodic rental payments in the lease. The initial term of the lease was for ten years, after which Solar had the option to extend the lease for three five-year periods.

Before the fields were completed, neighbors of the church expressed concern about the lights to be installed for the fields. These concerns culminated in a lawsuit, the Hodgson case, brought against Prince of Peace and Solar. The Hodgson suit was settled out of court, and the final judgment dismissing it provided, "all claims, counterclaims, cross-claims and third-party claims which have been or could have been asserted in the above-entitled and numbered . . . litigation by the parties against one another are dismissed with prejudice to refiling. . . ." Prince of Peace then filed this lawsuit seeking to terminate the lease. Solar moved for summary judgment, alleging the agreed order of dismissal precluded all of Prince of Peace's claims. The trial judge granted this motion in part, holding the Hodgson order of dismissal "is not ambiguous and that all claims and any matters dismissed with prejudice by such Order of Dismissal with Prejudice dated May 20, 2003 are barred from this suit as a matter of law."

In this lawsuit, Prince of Peace alleged breaches of four contractual provisions: the insurance provision, the field maintenance provision, the utilities clause, and the use clause. The trial judge granted partial summary judgment in favor of Prince of Peace, ruling Solar breached the insurance provision and the field maintenance provision of the lease as a matter of law. The jury found Solar breached the utilities clause and the use clause. The jury also found, however, that Prince of Peace suffered no damages as a result of Solar's breaches of the insurance and the use clauses. The jury awarded Prince of Peace $25,000 for the breach of the field maintenance provision and $31,000 for the breach of the utilities clause. The jury also awarded attorney's fees to Prince of Peace in the amount of $130,000 for trial, $20,000 for appeal to the court of appeals, and $15,000 for appeal to the supreme court.

Over objection by Prince of Peace, the jury charge included questions relating to Solar's claim for recovery of damages in quantum meruit for its construction of the fields. The jury found Solar performed compensable work with a value of $342,568.33. The trial judge offset the damages awarded to each party by the jury and entered judgment that Solar recover $154,934.33 from Prince of Peace. The judgment also terminated the lease. After post-judgment hearings, the trial judge set the amount of supersedeas bonds to be posted by each party in prosecuting their appeals of the judgment. As a result of these post-judgment hearings and orders, Solar continues to use the lighted fields.

Each party appeals. Solar asserts seven multi-part issues. It complains Prince of Peace's claims were barred by res judicata. Solar also contends the trial judge erred in granting summary judgment for Prince of Peace on its breach of contract claims and on Solar's affirmative defenses, granting judgment terminating the ground lease, and awarding Prince of Peace damages and attorney's fees. Solar further complains of the sufficiency of the evidence to support certain of the jury's findings. In six issues, Prince of Peace complains of Solar's recovery' of damages in quantum meruit and the trial judge's rulings regarding enforcement of the judgment pending appeal.

STANDARDS OF REVIEW

Solar challenges the legal and factual sufficiency of the evidence to support the jury's findings. In reviewing the legal sufficiency of the evidence, we consider all the evidence in the light most favorable to the prevailing party, indulging every reasonable inference in that party's favor. See Associated Indem. Corp. v. CAT Contracting, Inc., 964 S.W.2d 276, 286 (Tex.1998). We must credit the favorable evidence if reasonable jurors could and disregard the contrary evidence unless reasonable jurors could not. City of Keller v. Wilson, 168 S.W.3d 802, 807, 827 (Tex. 2005). When reviewing a finding for factual sufficiency, we consider all of the evidence and will set aside the finding only if it is so contrary to the overwhelming weight of the evidence as to be clearly wrong and unjust. Cain v. Bain, 709 S.W.2d 175, 176 (Tex.1986) (per curiam).

Solar also challenges certain of the trial judge's summary judgment rulings. We review a summary judgment de novo to determine whether a party has established its right to summary judgment as a matter of law. See Dallas Cent. Appraisal Dist. v. Cunningham, 161 S.W.3d 293, 295 (Tex.App.-Dallas 2005, no pet.). In reviewing a summary judgment, we must examine the entire record in the light most favorable to the nonmovant. See City of Keller, 168 S.W.3d at 824-25.

Prince of Peace sought a declaratory judgment defining its rights under the lease, specifically seeking a declaration terminating the lease and permitting Prince of Peace to resume exclusive possession of the leased property. We review declaratory judgments under the same standards as other judgments and decrees. TEX. CIV. PRAC. & REM.CODE ANN. § 37.010 (Vernon 1997). We look to the procedure used to resolve the issue at trial to determine the standard of review on appeal. Hawkins v. El Paso First Health Plans, Inc., 214 S.W.3d 709, 719 (Tex.App.-Austin 2007, pet. filed). Here the trial judge determined the declaratory judgment issue after summary judgment rulings and a jury trial. Therefore we apply the standards set forth above for review of summary judgments and jury findings and review the trial judge's conclusions of law de novo. See Hawkins, 214 S.W.3d at 719; Montfort v. Trek Resources, Inc., 198 S.W.3d 344, 354 (Tex.App.-Eastland 2006, no pet.).

We review the trial judge's rulings regarding enforcement of the judgment pending appeal for abuse of discretion. A trial judge abuses her discretion if she acts in an arbitrary or unreasonable manner without reference to any guiding rules or principles. See Walker v. Gutierrez, 111 S.W.3d 56, 62 (Tex.2003).

SOLAR'S APPEAL

Res Judicata

Before we review Solar's primary complaint that the lease should not have been terminated, we address Solar's arguments that Prince of Peace's lawsuit against it could not be brought at all. In its first issue, Solar argues the trial judge erred in permitting Prince of Peace to proceed to trial on claims that were barred. Solar contends the order of dismissal in the Hodgson suit precludes Prince of Peace from asserting any claims in this lawsuit. The essence of Solar's complaint is that res judicata applies to bar all of Prince of Peace's claims. In its second issue, Solar complains the trial judge erred in granting Prince of Peace summary judgment on Solar's affirmative defenses of res judicata, estoppel, and waiver. We address these issues together.

Solar concedes res judicata would not normally apply where, as here, Solar and Prince of Peace were co-defendants in an earlier lawsuit and neither asserted any cross-claims against the other. See State & County Mut. Fire Ins. Co. v. Miller, 52 S.W.3d 693, 696 (Tex.2001) (per curiam) (where co-defendants in first suit could have filed cross-actions against each other but did not, res judicata did not bar claims by one of co-defendants against other in second suit); see also TEX.R. CIV. P. 97(e) (pleading "may" state cross-claim by one party against co-party). But Solar argues the language of the Hodgson order of dismissal, "that all claims, counterclaims, cross-claims, and third-party claims which have been or could have been asserted in the above-entitled and numbered and [sic] litigation by the parties against one another are dismissed with prejudice to refiling," bars Prince of Peace's claims nonetheless. Solar argues all of Prince of Peace's claims "could have been asserted" in the Hodgson suit.

Rule 97(e) of the Texas Rules of Civil Procedure provides "[a] pleading may state as a cross-claim any claim by one party...